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Section 1: 8-K (8-K)

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 UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): October 29, 2018
Brixmor Property Group Inc.
Brixmor Operating Partnership LP
(Exact Name of Registrant as Specified in its Charter)
 
 
 
 
 
Maryland (Brixmor Property Group Inc.)
 
001-36160
 
45-2433192
Delaware (Brixmor Operating Partnership LP)
 
333-201464-01
 
80-0831163
(State or Other Jurisdiction
of Incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
450 Lexington Avenue
New York, New York 10017
(Address of Principal Executive Offices) (Zip Code)
(212) 869-3000
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)


Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))


Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company. See the definitions of “emerging growth company” in Rule 12b-2 of the Exchange Act.     
Brixmor Property Group Inc. Yes No þ Brixmor Operating Partnership LP Yes No þ

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.     
Brixmor Property Group Inc. Brixmor Operating Partnership LP




Item 2.02
Results of Operations and Financial Condition.

On October 29, 2018, Brixmor Property Group Inc. (the "Company") issued a press release announcing its financial results and Supplemental Disclosure pertaining to its operations for the third quarter ended September 30, 2018. The press release is furnished as Exhibit 99.1 to this Report and the Supplemental Disclosure is furnished as Exhibit 99.2 to this Report.

As provided in General Instruction B.2 of Form 8-K, the information in this Item 2.02 and Exhibits 99.1 and 99.2 to this Form 8-K shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01
Financial Statements and Exhibits
(d)     The following exhibits are attached to this Current Report on Form 8-K
  
Press release issued October 29, 2018.
 
 
 
  
Brixmor Property Group Inc. Supplemental Financial Information for the third quarter ended September 30, 2018.





SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned hereunto duly authorized.
 
 
 
Date: October 29, 2018
BRIXMOR PROPERTY GROUP INC.
 
 
 
 
By:
/s/ Steven F. Siegel
 
Name:
Steven F. Siegel
 
Title:
Executive Vice President,
 
 
General Counsel and Secretary
 
 
 
 
BRIXMOR OPERATING PARTNERSHIP LP
 
 
 
 
By:
Brixmor OP GP LLC, its general partner
 
 
 
 
By:
BPG Subsidiary Inc., its sole member
 
 
 
 
By:
/s/ Steven F. Siegel
 
Name:
Steven F. Siegel
 
Title:
Executive Vice President,
 
 
General Counsel and Secretary



(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit
Exhibit 99.1
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450 Lexington Avenue : New York, NY 10017 : 800.468.7526





FOR IMMEDIATE RELEASE

CONTACT:
Stacy Slater                            
Senior Vice President, Investor Relations            
800.468.7526                             
stacy.slater@brixmor.com
BRIXMOR PROPERTY GROUP REPORTS THIRD QUARTER 2018 RESULTS
- Accelerating Value Creation -

NEW YORK, OCTOBER 29, 2018 - Brixmor Property Group Inc. (NYSE: BRX) (“Brixmor” or the “Company”) announced today its operating results for the three and nine months ended September 30, 2018. For the three months ended September 30, 2018 and 2017, net income attributable to common stockholders was $0.49 per diluted share and $0.27 per diluted share, respectively.

Key highlights for the three months ended September 30, 2018 include:
Executed 2.2 million square feet of new and renewal leases at comparable rent spreads of 13.4%, including 0.9 million square feet of new leases at comparable rent spreads of 39.7%
Executed 3.1 million square feet of total leasing volume, including options, at comparable rent spreads of 12.1%
Grew total leased occupancy 90 basis points year over year to 92.5%, including 110 basis points of growth in small shop leased occupancy to 85.5%
Maintained widest leased to billed occupancy spread since IPO of 310 basis points
Generated same property NOI growth of 1.2%, driven by a 270 basis points contribution from base rent
Grew total in process reinvestment pipeline to $340.4 million, while delivering $53.8 million of projects at an average incremental NOI yield of 9%
Closed on $530.2 million of dispositions, including six assets totaling $76.7 million closed subsequent to quarter end
Acquired one adjacency at an existing center for $1.5 million, repurchased $48.6 million of common stock and repaid $507.2 million of secured indebtedness
Issued $250.0 million of Floating Rate Notes due 2022 and repaid a portion of the Company’s $600.0 million term loan
Increased quarterly dividend by 1.8% to $0.28 per common share, which represents an annualized yield of 7.3%
Updated previously provided NAREIT FFO per diluted share expectations and affirmed same property NOI expectations for 2018

“I am very pleased with how our record leasing, growth in redevelopment, accelerated capital recycling and prudent balance sheet management not only position us for sustainable growth in 2019 and beyond, but also how this progress across all fronts of our self-funded plan, in an otherwise volatile marketplace, continues to significantly enhance the intrinsic value of our portfolio,” commented James Taylor, Chief Executive Officer and President.

FINANCIAL HIGHLIGHTS
Net Income
For the three months ended September 30, 2018 and 2017, net income attributable to common stockholders was $147.3 million, or $0.49 per diluted share, and $83.4 million, or $0.27 per diluted share, respectively.
For the nine months ended September 30, 2018 and 2017, net income attributable to common stockholders was $288.7 million, or $0.95 per diluted share, and $230.4 million, or $0.75 per diluted share, respectively.



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NAREIT FFO
For the three months ended September 30, 2018 and 2017, NAREIT FFO was $128.4 million, or $0.42 per diluted share, and $157.2 million, or $0.52 per diluted share, respectively. Results for the three months ended September 30, 2018 include a loss on extinguishment of debt related to the prepayment of secured indebtedness and other items that impact FFO comparability of ($20.3) million, or ($0.07) per diluted share. Results for the three months ended September 30, 2017 include litigation and other non-routine legal expenses, a gain on extinguishment of debt and other items that impact FFO comparability of ($0.3) million, or ($0.00) per diluted share.
For the nine months ended September 30, 2018 and 2017, NAREIT FFO was $437.5 million, or $1.44 per diluted share, and $480.7 million, or $1.58 per diluted share, respectively. Results for the nine months ended September 30, 2018 include a loss on extinguishment of debt related to the prepayment of secured indebtedness, litigation and other non-routine legal expenses and other items that impact FFO comparability of ($22.1) million, or ($0.07) per diluted share. Results for the nine months ended September 30, 2017 include litigation and other non-routine legal expenses and other items that impact FFO comparability of ($3.3) million, or ($0.01) per diluted share.

Same Property NOI Growth
Same property NOI for the three months ended September 30, 2018 increased 1.2% from the comparable 2017 period.
Same property base rent for the three months ended September 30, 2018 contributed 270 basis points to same property NOI growth.
Same property NOI for the nine months ended September 30, 2018 increased 1.3% from the comparable 2017 period.
Same property base rent for the nine months ended September 30, 2018 contributed 190 basis points to same property NOI growth.

Dividend
The Company’s Board of Directors declared a quarterly cash dividend of $0.28 per common share (equivalent to $1.12 per annum) for the fourth quarter of 2018, which represents a 1.8% increase.
The dividend is payable on January 15, 2019 to stockholders of record on January 4, 2019, representing an ex-dividend date of January 3, 2019.

PORTFOLIO AND INVESTMENT ACTIVITY
Value Enhancing Reinvestment Opportunities
During the three months ended September 30, 2018, the Company completed eight value enhancing reinvestment projects and added nine new reinvestment opportunities to its in process pipeline. Projects added include five anchor space repositioning projects, three outparcel development projects and one redevelopment project, with a total aggregate net estimated cost of approximately $55.3 million at an expected average incremental NOI yield of 10%.
At September 30, 2018, the value enhancing reinvestment in process pipeline was comprised of 56 projects with an aggregate net estimated cost of approximately $340.4 million. The in process pipeline includes 31 anchor space repositioning projects with an aggregate net estimated cost of approximately $122.2 million at expected average incremental NOI yields of 9 to 14%; 12 outparcel development projects with an aggregate net estimated cost of approximately $19.1 million at an expected average incremental NOI yield of 12%; and 13 redevelopment projects with an aggregate net estimated cost of approximately $199.1 million at an expected average incremental NOI yield of 9%.

Dispositions
During the three months ended September 30, 2018, the Company generated approximately $453.5 million of gross proceeds on the disposition of 28 assets, including two partial properties, comprised of 3.5 million square feet.
During the nine months ended September 30, 2018, the Company generated approximately $699.3 million of gross proceeds on the disposition of 44 assets, including two partial properties, comprised of 6.4 million square feet.

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450 Lexington Avenue : New York, NY 10017 : 800.468.7526



Subsequent to September 30, 2018, the Company generated approximately $76.7 million of gross proceeds on the disposition of six assets, including one partial property, comprised of 0.7 million square feet.

Acquisitions
During the three months ended September 30, 2018, the Company acquired a building adjacent to an existing center for $1.5 million.
During the nine months ended September 30, 2018, the Company acquired a building and land adjacent to existing centers and terminated a ground lease and acquired the associated building at an existing center for a combined purchase price of $8.8 million.
During the three months ended September 30, 2018, the Company repurchased 2.7 million shares of common stock under its share repurchase program at an average price per share of $17.77 for a total of approximately $48.6 million, excluding commissions. Since inception of the share repurchase program in December 2017, the Company has repurchased 5.2 million shares of common stock at an average price per share of $16.78 for a total of approximately $87.7 million, excluding commissions.

CAPITAL STRUCTURE
As previously announced, during the three months ended September 30, 2018, the Company’s Operating Partnership, Brixmor Operating Partnership LP, issued $250.0 million aggregate principal amount of Floating Rate Notes due 2022 with an interest rate equal to three-month U.S. dollar LIBOR plus 1.05% per annum, reset quarterly. The net proceeds from the offering were utilized to repay a portion of the Company’s $600.0 million Term Loan maturing March 18, 2019.
Also as previously announced, during the three months ended September 30, 2018, the Company repaid $507.2 million of secured indebtedness, including amortization, scheduled to mature in 2020 at a weighted average stated interest rate of 6.2%. These repayments were funded with disposition proceeds and with proceeds from the Company’s $1.25 billion revolving credit facility, which had $1.10 billion of availability as of September 30, 2018.
In connection with the early repayment of certain indebtedness, the Company recognized a loss on extinguishment of debt of $19.8 million, or $0.07 per diluted share during the three months ended September 30, 2018.

GUIDANCE
The Company has updated its previously provided NAREIT FFO per diluted share expectations for 2018 to $1.89 - 1.94 from $1.95 - 2.04.
The Company’s previous NAREIT FFO guidance did not include the ($0.07) loss on extinguishment of debt recognized during the three months ended September 30, 2018. The Company’s updated guidance does not include any expectations of additional loss on extinguishment of debt related to potential capital transactions or any expectations of additional one-time items, including, but not limited to, litigation, investigative and other non-routine legal expenses.
The Company has affirmed its previously provided same property NOI growth expectations for 2018 of 1.00 - 1.50%.
The following table provides a reconciliation of the range of the Company’s 2018 estimated net income attributable to common stockholders to NAREIT FFO:
 
 
2018E

 
2018E Per Diluted

(Unaudited, dollars in millions, except per share amounts)
 
 
 
Share

Net income attributable to common stockholders
 
$343 - $359

 
$1.14 - $1.19

Depreciation and amortization
 
343

 
1.13

Impairment of operating properties
 
44

 
0.15

Gain on disposition of operating properties
 
(159
)
 
(0.53
)
NAREIT FFO
 
$571 - $587

 
$1.89 - $1.94




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450 Lexington Avenue : New York, NY 10017 : 800.468.7526



CONNECT WITH BRIXMOR
For additional information, please visit www.brixmor.com;
Follow Brixmor on Twitter at www.twitter.com/Brixmor;
Find Brixmor on LinkedIn at www.linkedin.com/company/brixmor.

CONFERENCE CALL AND SUPPLEMENTAL INFORMATION
The Company will host a teleconference on Tuesday, October 30, 2018 at 10:00 AM ET. To participate, please dial 877.705.6003 (domestic) or 201.493.6725 (international) within 15 minutes of the scheduled start of the call. The teleconference can also be accessed via a live webcast at www.brixmor.com in the Investors section. A replay of the teleconference will be available through midnight ET on November 13, 2018 by dialing 844.512.2921 (domestic) or 412.317.6671 (international) (Passcode: 13683065) or via the web through October 30, 2019 at www.brixmor.com in the Investors section.

The Company’s Supplemental Disclosure will be posted at www.brixmor.com in the Investors section.  These materials are also available to all interested parties upon request to the Company at investorrelations@brixmor.com or 800.468.7526.

NON-GAAP DISCLOSURES
The Company presents the non-GAAP performance measures set forth below. These measures should not be considered as alternatives to, or more meaningful than, net income (presented in accordance with GAAP) or other GAAP financial measures, as an indicator of financial performance and are not alternatives to, or more meaningful than, cash flow from operating activities (presented in accordance with GAAP) as a measure of liquidity. Non-GAAP performance measures have limitations as they do not include all items of income and expense that affect operations, and accordingly, should always be considered as supplemental financial results to those presented in accordance with GAAP. The Company’s computation of these non-GAAP measures may differ in certain respects from the methodology utilized by other REITs and, therefore, may not be comparable to similarly titled measures presented by such other REITs. Investors are cautioned that items excluded from these non-GAAP measures are relevant to understanding and addressing financial performance. A reconciliation of these non-GAAP measures to net income is presented in the attached table.

NAREIT FFO
NAREIT FFO is a supplemental non-GAAP performance measure utilized to evaluate the operating performance of real estate companies. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) presented in accordance with GAAP excluding (i) gain (loss) on disposition of operating properties, and (ii) extraordinary items, plus (iii) depreciation and amortization of operating properties, (iv) impairment of operating properties and real estate equity investments, and (v) after adjustments for unconsolidated joint ventures calculated to reflect FFO on the same basis.

The Company believes NAREIT FFO assists investors in analyzing Brixmor’s comparative operating and financial performance because, by excluding (i) gains and losses related to dispositions of previously depreciated operating properties, (ii) real estate-related depreciation and amortization of continuing operations, (iii) impairment of operating properties and real estate equity investments, (iv) extraordinary items, and (v) after adjustments for joint ventures calculated to reflect FFO on the same basis, investors can compare the operating and financial performance of a company’s real estate between periods.

Same Property NOI
Same property NOI is a supplemental, non-GAAP performance measure utilized to evaluate the operating performance of real estate companies. Same property NOI is calculated (using properties owned for the entirety of both periods excluding properties under development),

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as total property revenues ((i) base rent, ancillary and other, (ii) expense reimbursements, and (iii) percentage rents) less direct property operating expenses ((i) operating costs, (ii) real estate taxes, and (iii) provision for doubtful accounts). Same property NOI excludes (i) corporate level income (including management, transaction, and other fees), (ii) lease termination fees, (iii) straight-line rental income, (iv) amortization of above- and below-market rent and tenant inducements, (v) straight-line ground rent expense, and (vi) income / expense associated with the Company’s captive insurance entity.

The Company believes same property NOI assists investors in analyzing Brixmor’s comparative operating and financial performance because it eliminates disparities in NOI due to the acquisition, disposition or stabilization of development properties during the period presented and therefore provides a more consistent metric for comparing the operating performance of a company’s real estate between periods.

ABOUT BRIXMOR PROPERTY GROUP
Brixmor (NYSE: BRX) is a real estate investment trust (REIT) that owns and operates a high-quality, national portfolio of open-air shopping centers. Its 445 retail centers comprise approximately 77 million square feet of prime retail space in established trade areas. The Company strives to own and operate shopping centers that reflect Brixmor’s vision “to be the center of the communities we serve” and are home to a diverse mix of thriving national, regional and local retailers. Brixmor is a proud real estate partner to more than 5,000 retailers including The TJX Companies, The Kroger Co., Publix Super Markets, Wal-Mart, Ross Stores and L.A. Fitness.

SAFE HARBOR LANGUAGE
This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include, but are not limited to, statements related to the Company’s expectations regarding the performance of its business, its financial results, its liquidity and capital resources and other non-historical statements. You can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including those described under the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, as such factors may be updated from time to time in our periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the Company’s filings with the SEC. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.
###


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CONSOLIDATED BALANCE SHEETS
Unaudited, dollars in thousands, except share information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of
 
As of
 
 
 
 
 
9/30/18
 
12/31/17
 
Assets
 
 
 
 
 
Real estate
 
 
 
 
 
 
Land
$
1,845,114

 
$
1,984,309

 
 
 
Buildings and tenant improvements
7,614,385

 
8,063,871

 
 
 
Construction in progress
98,354

 
81,214

 
 
 
Lease intangibles
697,118

 
792,097

 
 
 
 
 
10,254,971

 
10,921,491

 
 
 
Accumulated depreciation and amortization
(2,358,782
)
 
(2,361,070
)
 
 
Real estate, net
7,896,189

 
8,560,421

 
 
Cash and cash equivalents
19,607

 
56,938

 
 
Restricted cash
45,412

 
53,839

 
 
Marketable securities
30,725

 
28,006

 
 
Receivables, net of allowance for doubtful accounts of $18,947 and $17,205
230,782

 
232,111

 
 
Deferred charges and prepaid expenses, net
150,232

 
147,508

 
 
Other assets
124,491

 
75,103

 
Total assets
$
8,497,438

 
$
9,153,926

 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
Debt obligations, net
$
5,106,708

 
$
5,676,238

 
 
Accounts payable, accrued expenses and other liabilities
516,468

 
569,340

 
Total liabilities
5,623,176

 
6,245,578

 
 
 
 
 
 
 
 
 
Equity
 
 
 
 
 
Common stock, $0.01 par value; authorized 3,000,000,000 shares;
 
 
 
 
 
 
305,118,890 and 304,947,144 shares issued and 299,891,880 and 304,620,186
 
 
 
 
 
 
shares outstanding
2,999

 
3,046

 
 
Additional paid-in capital
3,254,722

 
3,330,466

 
 
Accumulated other comprehensive income
27,121

 
24,211

 
 
Distributions in excess of net income
(410,580
)
 
(449,375
)
 
Total equity
2,874,262

 
2,908,348

 
Total liabilities and equity
$
8,497,438

 
$
9,153,926










 
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CONSOLIDATED STATEMENTS OF OPERATIONS
 
 
 
 
Unaudited, dollars in thousands, except per share amounts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Nine Months Ended
 
 
 
 
 
9/30/18
 
9/30/17
 
9/30/18
 
9/30/17
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
Rental income
$
239,217

 
$
246,578

 
$
726,549

 
$
749,976

 
 
Expense reimbursements
66,348

 
66,489

 
204,589

 
206,718

 
 
Other revenues
915

 
1,429

 
5,547

 
6,426

 
Total revenues
306,480

 
314,496

 
936,685

 
963,120

 
 
 
 
 
 
 
 
 
 
 
 
 
Operating expenses
 
 
 
 
 
 
 
 
 
Operating costs
31,969

 
30,505

 
101,340

 
100,955

 
 
Real estate taxes
44,711

 
45,076

 
135,383

 
135,607

 
 
Depreciation and amortization
85,183

 
94,239

 
266,900

 
285,040

 
 
Provision for doubtful accounts
3,094

 
1,216

 
6,458

 
4,023

 
 
Impairment of real estate assets
16,372

 
11,065

 
44,201

 
27,383

 
 
General and administrative
21,209

 
22,838

 
64,955

 
67,043

 
Total operating expenses
202,538

 
204,939

 
619,237

 
620,051

 
 
 
 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Dividends and interest
156

 
76

 
356

 
234

 
 
Interest expense
(55,364
)
 
(57,410
)
 
(165,735
)
 
(170,584
)
 
 
Gain on sale of real estate assets
119,333

 
25,942

 
159,043

 
54,920

 
 
Gain (loss) on extinguishment of debt, net
(19,759
)
 
1,828

 
(20,182
)
 
488

 
 
Other
(962
)
 
(1,200
)
 
(2,200
)
 
(2,591
)
 
Total other income (expense)
43,404

 
(30,764
)
 
(28,718
)
 
(117,533
)
 
 
 
 
 
 
 
 
 
 
 
 
 
Income before equity in income of unconsolidated joint venture
147,346

 
78,793

 
288,730

 
225,536

 
Equity in income of unconsolidated joint venture

 
31

 

 
381

 
Gain on disposition of unconsolidated joint venture interest

 
4,556

 

 
4,556

 
Net income
147,346

 
83,380

 
288,730

 
230,473

 
Net income attributable to non-controlling interests

 

 

 
(76
)
 
Net income attributable to Brixmor Property Group Inc.
147,346

 
83,380

 
288,730

 
230,397

 
Preferred stock dividends

 

 

 
(39
)
 
Net income attributable to common stockholders
$
147,346

 
$
83,380

 
$
288,730

 
$
230,358

 
 
 
 
 
 
 
 
 
 
 
 
 
Per common share:
 
 
 
 
 
 
 
 
 
Net income attributable to common stockholders:
 
 
 
 
 
 
 
 
 
 
Basic
$
0.49

 
$
0.27

 
$
0.95

 
$
0.76

 
 
 
Diluted
$
0.49

 
$
0.27

 
$
0.95

 
$
0.75

 
 
Weighted average shares:
 
 
 
 
 
 
 
 
 
 
Basic
302,170

 
304,936

 
303,031

 
304,810

 
 
 
Diluted
302,382

 
305,176

 
303,213

 
305,175









 
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FUNDS FROM OPERATIONS (FFO)
 
 
 
 
Unaudited, dollars in thousands, except per share amounts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Nine Months Ended
 
 
 
 
 
9/30/18
 
9/30/17
 
9/30/18
 
9/30/17
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
$
147,346

 
$
83,380

 
$
288,730

 
$
230,473

 
 
Gain on disposition of operating properties
(119,333
)
 
(25,942
)
 
(159,043
)
 
(54,920
)
 
 
Gain on disposition of unconsolidated joint venture interest

 
(4,556
)
 

 
(4,556
)
 
 
Depreciation and amortization- real estate related- continuing operations
84,028

 
93,299

 
263,616

 
282,240

 
 
Depreciation and amortization- real estate related- unconsolidated joint venture

 

 

 
56

 
 
Impairment of operating properties
16,372

 
11,065

 
44,201

 
27,383

 
NAREIT FFO
$
128,413

 
$
157,246

 
$
437,504

 
$
480,676

 
 
 
 
 
 
 
 
 
 
 
 
 
NAREIT FFO per share/OP Unit - diluted
$
0.42

 
$
0.52

 
$
1.44

 
$
1.58

 
Weighted average shares/OP Units outstanding - basic and diluted
302,382

 
305,176

 
303,213

 
305,175

 
 
 
 
 
 
 
 
 
 
 
 
 
Items that impact FFO comparability
 
 
 
 
 
 
 
 
 
Gain (loss) on extinguishment of debt, net
$
(19,759
)
 
$
1,828

 
$
(20,182
)
 
$
488

 
 
Litigation and other non-routine legal expenses
(467
)
 
(1,959
)
 
(1,655
)
 
(3,629
)
 
 
Transaction expenses
(95
)
 
(204
)
 
(294
)
 
(204
)
 
Total items that impact FFO comparability
$
(20,321
)
 
$
(335
)
 
$
(22,131
)
 
$
(3,345
)
 
Items that impact FFO comparability, net per share
$
(0.07
)
 
$
(0.00
)
 
$
(0.07
)
 
$
(0.01
)
 
 
 
 
 
 
 
 
 
 
 
 
 
Additional Disclosures
 
 
 
 
 
 
 
 
 
Straight-line rental income, net (1)
$
5,015

 
$
2,397

 
$
11,896

 
$
14,484

 
 
Amortization of above- and below-market leases and tenant inducements, net (2)
5,112

 
6,966

 
18,250

 
21,449

 
 
Straight-line ground rent expense (3)
(40
)
 
(31
)
 
(100
)
 
(104
)
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividends declared per share/ OP Unit
$
0.275

 
$
0.260

 
$
0.825

 
$
0.780

 
Share/OP Unit dividends declared
$
82,470

 
$
79,283

 
$
248,970

 
$
237,839

 
Share/OP Unit dividend payout ratio (as % of NAREIT FFO)
64.2
%
 
50.4
%
 
56.9
%
 
49.5
%
 
 
 
 
 
 
 
 
 
 
 
 
(1) Includes unconsolidated joint venture Montecito Marketplace straight-line rental expense, net of $4 and $2 at pro rata share for the three and nine months ended September 30, 2017,
respectively. Montecito Marketplace was sold on August 8, 2017.
(2) Includes unconsolidated joint venture Montecito Marketplace amortization of above- and below-market leases and tenant inducements, net of $2 and $15 at pro rata share for the three
and nine months ended September 30, 2017, respectively. Montecito Marketplace was sold on August 8, 2017.
 
 
 
 
(3) Straight-line ground rent expense is included in Operating costs on the Consolidated Statements of Operations.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 









 
viii
395526419_jpgstandardlogoa21.jpg



SAME PROPERTY NOI ANALYSIS
 
 
 
 
 
 
 
Unaudited, dollars in thousands
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
 
Nine Months Ended
 
 
 
 
 
 
 
 
 
9/30/18
 
9/30/17
 
Change
 
9/30/18
 
9/30/17
 
Change
 
 
Same Property NOI Analysis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of properties
 
439

 
439

 
 
437

 
437

 
 
 
Percent billed
 
89.4
%
 
89.6
%
 
(0.2%)
 
89.4
%
 
89.6
%
 
(0.2%)
 
 
Percent leased
 
92.5
%
 
91.6
%
 
0.9%
 
92.5
%
 
91.6
%
 
0.9%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Base rent
 
$
215,330

 
$
209,900

 
 
 
$
636,580

 
$
624,375

 
 
 
 
 
Ancillary and other
 
4,295

 
3,914

 
 
 
12,279

 
10,705

 
 
 
 
 
Expense reimbursements
 
63,916

 
61,580

 
 
 
190,400

 
187,651

 
 
 
 
 
Percentage rents
 
838

 
1,161

 
 
 
5,340

 
5,837

 
 
 
 
 
 
 
 
 
284,379

 
276,555

 
0.6%
 
844,599

 
828,568

 
2.5%
 
 
Operating expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating costs
 
(30,972
)
 
(28,673
)
 
 
 
(94,539
)
 
(90,878
)
 
 
 
 
 
Real estate taxes
 
(43,023
)
 
(41,777
)
 
 
 
(125,997
)
 
(123,619
)
 
 
 
 
 
Provision for doubtful accounts
 
(2,850
)
 
(1,041
)
 
 
 
(5,539
)
 
(3,623
)
 
 
 
 
 
 
 
 
 
(76,845
)
 
(71,491
)
 
7.5%
 
(226,075
)
 
(218,120
)
 
3.6%
 
 
Same property NOI
 
$
207,534

 
$
205,064

 
1.2%
 
$
618,524

 
$
610,448

 
1.3%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same property NOI excluding redevelopments (1)
 
$
189,179

 
$
188,049

 
0.6%
 
$
564,172

 
$
559,121

 
0.9%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NOI margin
 
73.0
%
 
74.1
%
 
 
 
73.2
%
 
73.7
%
 
 
 
 
Expense recovery ratio
 
86.4
%
 
87.4
%
 
 
 
86.3
%
 
87.5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percent contribution to same property NOI growth:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Change
 
Percent Contribution
 
 
 
Change
 
Percent Contribution
 
 
 
 
 
Base rent
 
$
5,430

 
2.7%
 
 
 
$
12,205

 
1.9%
 
 
 
 
 
Ancillary and other
 
381

 
0.2%
 
 
 
1,574

 
0.3%
 
 
 
 
 
Net recoveries
 
(1,209
)
 
(0.6%)
 
 
 
(3,290
)
 
(0.5%)
 
 
 
 
 
Percentage rents
 
(323
)
 
(0.2%)
 
 
 
(497
)
 
(0.1%)
 
 
 
 
 
Provision for doubtful accounts
 
(1,809
)
 
(0.9%)
 
 
 
(1,916
)
 
(0.3%)
 
 
 
 
 
 
 
 
 
 
 
1.2%
 
 
 
 
 
1.3%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reconciliation of Net Income Attributable to Common Stockholders to Same Property NOI
 
 
 
 
 
 
 
 
 
 
Same property NOI
 
$
207,534

 
$
205,064

 
 
 
$
618,524

 
$
610,448

 
 
 
 
Adjustments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-same property NOI
 
8,618

 
20,883

 
 
 
42,571

 
70,475

 
 
 
 
 
Lease termination fees
 
467

 
2,235

 
 
 
2,363

 
5,476

 
 
 
 
 
Straight-line rental income, net
 
5,015

 
2,401

 
 
 
11,896

 
14,486

 
 
 
 
 
Amortization of above- and below-market leases and tenant inducements, net
 
5,112

 
6,964

 
 
 
18,250

 
21,434

 
 
 
 
 
Fee income
 

 
183

 
 
 

 
320

 
 
 
 
 
Straight-line ground rent expense
 
(40
)
 
(31
)
 
 
 
(100
)
 
(104
)
 
 
 
 
 
Depreciation and amortization
 
(85,183
)
 
(94,239
)
 
 
 
(266,900
)
 
(285,040
)
 
 
 
 
 
Impairment of real estate assets
 
(16,372
)
 
(11,065
)
 
 
 
(44,201
)
 
(27,383
)
 
 
 
 
 
General and administrative
 
(21,209
)
 
(22,838
)
 
 
 
(64,955
)
 
(67,043
)
 
 
 
 
 
Total other income (expense)
 
43,404

 
(30,764
)
 
 
 
(28,718
)
 
(117,533
)
 
 
 
 
 
Equity in income of unconsolidated joint venture
 

 
31

 
 
 

 
381

 
 
 
 
 
Gain on disposition of unconsolidated joint venture interest
 

 
4,556

 
 
 

 
4,556

 
 
 
 
 
Net income attributable to non-controlling interests
 

 

 
 
 

 
(76
)
 
 
 
 
 
Preferred stock dividends
 

 

 
 
 

 
(39
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income attributable to common stockholders
 
$
147,346

 
$
83,380

 
 
 
$
288,730

 
$
230,358

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Redevelopments include only completed and in process projects. See Supplemental Disclosure for reconciliation.
 





 
ix
395526419_jpgstandardlogoa21.jpg

(Back To Top)

Section 3: EX-99.2 (EXHIBIT 99.2)

Exhibit
Exhibit 99.2


395526419_cover3q18.jpg



 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
SUPPLEMENTAL DISCLOSURE
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 





TABLE OF CONTENTS
 
 
 
 
 
 
 
 
 
 
 
 
Page
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: Financial information is unaudited.
 
 
 
 
 
 
 
 
 
For additional information, please visit www.brixmor.com, follow Brixmor on Twitter at www.twitter.com/Brixmor or find Brixmor on LinkedIn at www.linkedin.com/company/brixmor.
 
 
 
 
 
 
 
This Supplemental Disclosure may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include, but are not limited to, statements related to the Company’s expectations regarding the performance of its business, its financial results, its liquidity and capital resources and other non-historical statements. You can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including those described under the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 as such factors may be updated from time to time in our periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this document and in the Company’s filings with the SEC. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.


Supplemental Disclosure - Three Months Ended September 30, 2018
 
395526419_jpgstandardlogoa21.jpg




GLOSSARY OF TERMS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Term
 
Definition
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Anchor Spaces
 
Spaces equal to or greater than 10,000 square feet ("SF") of GLA.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Anchor Space Repositioning
 
Anchor leasing that is primarily focused on reconfiguring or significantly remerchandising existing space with minimal work required outside of normal
 
 
 
 
tenant improvement costs.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Annualized Base Rent ("ABR")
 
Monthly base rent as of a specified date, under leases which have been signed or commenced as of the specified date, multiplied by 12. Annualized
 
 
 
 
base rent (i) excludes tenant reimbursements of expenses, such as operating costs, real estate taxes and insurance expenses, (ii) excludes percentage
 
 
 
 
rent and ancillary income, and (iii) is calculated on a cash basis and differs from how rent is calculated in accordance with generally accepted
 
 
 
 
accounting principles in the United States of America (“GAAP”) for purposes of financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
ABR PSF
 
ABR divided by leased GLA, excluding the GLA of lessee owned leasehold improvements.
 
 
 
 
 
 
 
 
Billed GLA
 
Aggregate GLA of all commenced leases, as of a specified date.
 
 
 
 
 
 
 
 
Development & Redevelopment
 
Development and redevelopment projects are deemed stabilized upon the earlier of (i) reaching approximately 90% billed occupancy or (ii) one year
 
 
Stabilization

 
after the property is placed in service.

 
 
 
 
 
 
 
 
EBITDA, EBITDAre, Adjusted EBITDA &
Supplemental, non-GAAP performance measures. Please see below for more information on the limitations of non-GAAP performance measures.
 
 
Cash Adjusted EBITDA

 
A reconciliation of net income to each of these measures is provided on page 7.
 
 
 
 
EBITDA is calculated as the sum of net income (loss) presented in accordance with GAAP before (i) interest expense, (ii) federal and state taxes, and
 
 
 
 
(iii) depreciation and amortization. EBITDAre represents EBITDA as adjusted for (i) gain (loss) on disposition of operating properties and (ii) impairment
 
 
 
 
of real estate assets and real estate equity investments. Adjusted EBITDA represents EBITDAre as adjusted for (i) gain (loss) on extinguishment of debt
 
 
 
and (ii) other items that the Company believes are not indicative of the Company's operating performance. Cash Adjusted EBITDA represents
 
 
 
 
Adjusted EBITDA as adjusted for (i) straight-line rental income, (ii) amortization of above- and below-market leases and tenant inducements, and (iii)
 
 
 
 
straight-line ground rent expense. EBITDA, EBITDAre, Adjusted EBITDA & Cash Adjusted EBITDA include the Company's unconsolidated joint venture,
 
 
 
 
which was sold on August 8, 2017, at pro rata share.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross Leasable Area ("GLA")
 
Represents the total amount of leasable property square footage.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Leased GLA
 
Aggregate GLA of all signed or commenced leases, as of a specified date.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIBOR
 
London Interbank Offered Rate.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Metropolitan Statistical Area ("MSA")
Defined by the United States Office of Management and Budget as a region associated with at least one urbanized area that has a population of at
 
 
 
 
least 50,000 and comprises the central county or counties containing the core, plus adjacent outlying counties having a high degree of social and
 
 
 
 
economic integration with the central county or counties as measured through commuting.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NAREIT
 
National Association of Real Estate Investment Trusts.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NAREIT Funds From Operations (“FFO")
A supplemental, non-GAAP performance measure. Please see below for more information on the limitations of non-GAAP performance measures.
 
 
 
 
A reconciliation of net income to NAREIT FFO is provided on page 8.
 
 
 
 
NAREIT defines FFO as net income (loss) presented in accordance with GAAP excluding (i) gain (loss) on disposition of operating properties, (ii) gain (loss)
 
 
 
 
on disposition of unconsolidated joint venture interest, and (iii) extraordinary items, plus (iv) depreciation and amortization of operating properties,
 
 
 
 
(v) impairment of operating properties and real estate equity investments and (vi) after adjustments for unconsolidated joint ventures calculated to
 
 
 
 
reflect FFO on the same basis.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Effective Rent
 
Average ABR PSF over the lease term adjusted for tenant improvements and allowances, tenant specific landlord work and third party leasing
 
 
 
commissions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Operating Income ("NOI")
 
A supplemental, non-GAAP performance measure. Please see below for more information on the limitations of non-GAAP performance measures.
 
 
 
 
A reconciliation of NOI to net income is provided on page 10.
 
 
 
 
Calculated as total property revenues (base rent, ancillary and other, expense reimbursements, and percentage rents) less direct property operating
 
 
 
 
expenses (operating costs, real estate taxes and provision for doubtful accounts). NOI excludes (i) corporate level expenses (including G&A),
 
 
 
 
(ii) lease termination fees, (iii) straight-line rental income, (iv) amortization of above- and below-market leases and tenant inducements,
 
 
 
 
(v) straight-line ground rent expense and (vi) the Company's unconsolidated joint venture, which was sold on August 8, 2017.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NOI Yield
 
Calculated as the projected incremental NOI as a percentage of the incremental third party costs of a specified project, net of any project specific
 
 
 
 
credits (i.e. lease termination fees or other ancillary credits).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-controlling Interests
 
Relate to the portion of Brixmor Operating Partnership LP ("OP”), a consolidated subsidiary, held by the non-controlling interest holders. As of September
 
 
 
 
30, 2018, the Company, through its 100% ownership of BPG Subsidiary, Inc., owns 100% of the OP.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-owned Major Tenant
 
Also known as a shadow anchor. Represents tenants that are situated on parcels which are owned by unrelated third parties, but, due to their location
 
 
 
 
within or immediately adjacent to a shopping center, appear to the consumer as a retail tenant of the shopping center and, as a result, attract
 
 
 
 
additional consumer traffic to the center.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Outparcel
 
Refers to a portion of a shopping center, separate from the main retail buildings and generally located on the outer edge of a property, which may
 
 
 
 
currently, or in the future, contain one or several freestanding buildings.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percent Billed
 
Billed GLA as a percentage of total GLA.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percent Leased
 
Leased GLA as a percentage of total GLA.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PSF
 
Per square foot of GLA.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Redevelopment
 
Larger scale projects that typically involve new construction, reconfiguration or demolition of a portion of the shopping center to accommodate
 
 
 
 
new retailers.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Rent Spread
 
Represents the percentage change in cash ABR PSF in the first year of the new lease relative to cash ABR PSF in the last year of the old lease. Rent
 
 
 
 
spreads are presented only for leases deemed comparable.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New Rent Spread
 
Includes new leases executed on units that were occupied within the prior 12 months. New leases signed on units that have been vacant for
 
 
 
 
longer than 12 months and new leases signed on first generation space are non-comparable and excluded from New Rent Spreads.