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FEDERAL REALTY INVESTMENT TRUST - Annual Report: 2021 (Form 10-K)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 
FORM 10-K
ANNUAL REPORT PURSUANT TO THE SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2021
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             

Commission file number: 1-07533 (Federal Realty Investment Trust)
Commission file number: 333-262016-01 (Federal Realty OP LP) 

FEDERAL REALTY INVESTMENT TRUST
FEDERAL REALTY OP LP
(Exact Name of Registrant as Specified in its charter) 
Maryland (Federal Realty Investment Trust)
 87-3916363
Delaware (Federal Realty OP LP)
52-0782497
(State of Organization) (IRS Employer Identification No.)
909 Rose Avenue, Suite 200, North Bethesda, Maryland 20852
(Address of Principal Executive Offices) (Zip Code)
(301) 998-8100
(Registrant’s Telephone Number, Including Area Code) 
Securities registered pursuant to Section 12(b) of the Act:
Federal Realty Investment Trust
Title of Each ClassTrading SymbolName of Each Exchange On Which Registered
Common Shares of Beneficial InterestFRTNew York Stock Exchange
$.01 par value per share, with associated Common Share Purchase Rights
Depositary Shares, each representing 1/1000 of a shareFRT-CNew York Stock Exchange
of 5.00% Series C Cumulative Redeemable Preferred Stock, $.01 par value per share
Federal Realty OP LP
Title of Each ClassTrading SymbolName of Each Exchange On Which Registered
NoneN/AN/A
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Federal Realty Investment Trust       Yes      No
Federal Realty OP LP           Yes      No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Federal Realty Investment Trust       Yes      No
Federal Realty OP LP           Yes      No
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.
Federal Realty Investment Trust      Yes      No
Federal Realty OP LP              Yes      No


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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).
Federal Realty Investment Trust      Yes      No
Federal Realty OP LP              Yes      No
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 definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act:
Federal Realty Investment Trust
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
Federal Realty OP LP
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by checkmark if the registrant has elected not use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
Federal Realty Investment Trust
Federal Realty OP LP
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Federal Realty Investment Trust      Yes      No
Federal Realty OP LP              Yes      No

The aggregate market value of the registrant's common shares held by non-affiliates of the registrant, based upon the closing sales price of the registrant's common shares on June 30, 2021:    
Federal Realty Investment Trust: $9.1 billion
Federal Realty OP LP: N/A

The number of Federal Realty Investment Trust's common shares outstanding on February 7, 2022 was 78,616,815.


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FEDERAL REALTY INVESTMENT TRUST
FEDERAL REALTY OP LP
ANNUAL REPORT ON FORM 10-K
FISCAL YEAR ENDED DECEMBER 31, 2021

DOCUMENTS INCORPORATED BY REFERENCE

Portions of Federal Realty Investment Trust’s Proxy Statement to be filed with the Securities and Exchange Commission (the "SEC") for its annual meeting of shareholders to be held in May 2022 will be incorporated by reference into Part III hereof.

EXPLANATORY NOTE
Through the fiscal year ended December 31, 2021, the business of the registrant was conducted by an entity known as Federal Realty Investment Trust, a Maryland real estate investment trust (the “Predecessor”). On December 2, 2021, the Predecessor’s Board of Trustees approved the reorganization of the Predecessor’s business into an umbrella partnership real estate investment trust, or “UPREIT.” To effect the UPREIT reorganization, the Predecessor formed a wholly-owned subsidiary real estate investment trust known as FRT Holdco REIT (“Holdco”), and Holdco formed its own wholly-owned subsidiary real estate investment trust known as FRT Merger Sub REIT (“Merger Sub”). Holdco also formed a wholly-owned subsidiary limited liability company known as Federal Realty GP LLC (the “General Partner”). Effective as of January 1, 2022, Merger Sub merged with and into the Predecessor, with the Predecessor being the surviving entity and becoming a wholly-owned subsidiary of Holdco (the “Merger”). At the effective time of the Merger, each outstanding capital share of the Predecessor was converted into one equivalent capital share of Holdco. Effective as of January 5, 2022, the Predecessor converted into a Delaware limited partnership known as Federal Realty OP LP, the entity we refer to herein as the “Partnership.” In connection with the UPREIT reorganization, Holdco changed its name to Federal Realty Investment Trust, the entity we refer to herein as the “Parent Company.” The Parent Company had the same consolidated assets and liabilities immediately following the Merger as the Predecessor immediately before the Merger. The General Partner is the sole general partner of the Partnership, and the Parent Company owns 100% of the limited liability company interests of, is the sole member of and exercises exclusive control over the General Partner. Following the UPREIT reorganization described above, the Parent Company expects to conduct its business through the Partnership and does not expect to have substantial assets or liabilities other than through its investment in the Partnership.

As a result of the UPREIT reorganization, the Parent Company became the successor issuer to the Predecessor pursuant to Rule 12g-3(a) of the Securities Exchange Act of 1934 (the “Exchange Act”), and as a result, the Parent Company's common shares and Series C depositary shares were deemed registered under Section 12(b) of the Exchange Act. This Annual Report on Form 10-K pertains to the business and results of operations of the Predecessor for its fiscal year ended December 31, 2021. The Company and the Partnership have elected to co-file such Annual Report of the Predecessor to ensure continuity of information to investors. For additional information on our UPREIT reorganization, please see our Current Reports on Form 8-K filed with the SEC on January 3, 2022 and January 5, 2022.

Throughout this Annual Report, unless the context requires otherwise:
“Parent Company” refers to Federal Realty Investment Trust following the Merger;
“Partnership” refers to Federal Realty OP LP;
“we,” “us,” “our” or the “Trust” refer to the Parent Company and its business and operations conducted through its directly or indirectly owned subsidiaries, including Federal Realty OP LP; and
References to “shares” and “shareholders” refer to the shares and shareholders of the Parent Company and not the limited partnership interests or limited partners of the Partnership.
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TABLE OF CONTENTS
PART I
Item 1.Business
Item 1A.Risk Factors
Item 1B.Unresolved Staff Comments
Item 2.Properties
Item 3.Legal Proceedings
Item 4.Mine Safety Disclosures
PART II
Item 5.Market for Our Common Equity and Related Shareholder Matters and Issuer Purchases of Equity Securities
Item 6.Selected Financial Data
Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 7A.Quantitative and Qualitative Disclosures About Market Risk
Item 8.Financial Statements and Supplementary Data
Item 9.Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9A.Controls and Procedures
Item 9B.Other Information
PART III
Item 10.Trustees, Executive Officers and Corporate Governance
Item 11.Executive Compensation
Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters
Item 13.Certain Relationships and Related Transactions, and Trustee Independence
Item 14.Principal Accountant Fees and Services
PART IV
Item 15.Exhibits and Financial Statement Schedules
Item 16.Form 10-K Summary
SIGNATURES
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PART I


Forward-Looking Statements

Certain statements included in this Annual Report on Form 10-K are forward-looking statements. Those statements include statements regarding the intent, belief or current expectations of Federal Realty Investment Trust and Federal Realty OP LP (together, “we” “our” or “us”) and members of our management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “should” or similar expressions. Actual results may differ materially from those contemplated by such forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law.

The following are some of the risks and uncertainties, although not all risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward-looking statements:

risks that our tenants will not pay rent, may vacate early or may file for bankruptcy or that we may be unable to renew leases or re-let space at favorable rents as leases expire or to fill existing vacancy;
risks that we may not be able to proceed with or obtain necessary approvals for any development, redevelopment or renovation project, and that completion of anticipated or ongoing property development, redevelopment, or renovation projects that we do pursue may cost more, take more time to complete or fail to perform as expected;
risks normally associated with the real estate industry, including risks that occupancy levels at our properties and the amount of rent that we receive from our properties may be lower than expected, that new acquisitions may fail to perform as expected, that competition for acquisitions could result in increased prices for acquisitions, that costs associated with the periodic maintenance and repair or renovation of space, insurance and other operations may increase, that environmental issues may develop at our properties and result in unanticipated costs, and, because real estate is illiquid, that we may not be able to sell properties when appropriate;
risks that our growth will be limited if we cannot obtain additional capital;
risks associated with general economic conditions, including local economic conditions in our geographic markets;
risks of financing on terms which are acceptable to us, our ability to meet existing financial covenants and the limitations imposed on our operations by those covenants, and the possibility of increases in interest rates that would result in increased interest expense;
risks related to our status as a real estate investment trust, commonly referred to as a REIT, for federal income tax purposes, such as the existence of complex tax regulations relating to our status as a REIT, the effect of future changes in REIT requirements as a result of new legislation, and the adverse consequences of the failure to qualify as a REIT; and
risks related to natural disasters, climate change and public health crises (such as the outbreak and worldwide spread of COVID-19), and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities implement to address them, may precipitate or materially exacerbate one or more of the above-mentioned risks, and may significantly disrupt or prevent us from operating our business in the ordinary course for an extended period.

In addition, we describe risks and uncertainties that could cause actual results and events to differ materially in “Risk Factors” (Part I, Item 1A of this Annual Report on Form 10-K), “Quantitative and Qualitative Disclosures about Market Risk” (Part II, Item 7A), and “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” (Part II, Item 7).
ITEM 1.    BUSINESS
General
We are an equity real estate investment trust (“REIT”) specializing in the ownership, management, and redevelopment of high quality retail and mixed-use properties located primarily in communities where we believe retail demand exceeds supply, in strategically selected metropolitan markets in the Northeast and Mid-Atlantic regions of the United States, California, and South Florida. As of December 31, 2021, we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 104 predominantly retail real estate projects comprising approximately
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25.1 million square feet. In total, the real estate projects were 93.6% leased and 91.1% occupied at December 31, 2021. Our revenue is primarily generated from lease agreements with tenants. We have paid quarterly dividends to our shareholders continuously since our founding in 1962 and have increased our dividends per common share for 54 consecutive years.
We were founded in 1962 as a REIT under the laws of the District of Columbia and re-formed as a REIT in the state of Maryland in 1999. In January of 2022, we consummated the UPREIT reorganization described in the Explanatory Note at the beginning of this Annual Report. We operate in a manner intended to qualify as a REIT for tax purposes pursuant to provisions of the Internal Revenue Code of 1986, as amended (the “Code”). Our principal executive offices are located at 909 Rose Avenue, North Bethesda, Maryland 20852. Our telephone number is (301) 998-8100. Our website address is www.federalrealty.com. The information contained on our website is not a part of this report and is not incorporated herein by reference.
Business Objectives and Strategies
While the ongoing COVID-19 pandemic is impacting us in the short-term, our long-term focus has not changed.
Our primary business objective is to own, manage, acquire and redevelop a portfolio of high quality retail focused properties that will:
provide increasing cash flow for distribution to shareholders;
generate higher internal growth than the shopping center industry over the long term;
provide potential for capital appreciation; and
protect investor capital.
Our portfolio includes, and we continue to acquire and redevelop, high quality retail in many formats ranging from regional, community and neighborhood shopping centers that often are anchored by grocery stores to mixed-use properties that are typically centered around a retail component but also include office, residential and/or hotel components.
Operating Strategies
While managing through the ongoing COVID-19 pandemic has resulted in short-term deviations, our long-term core operating strategy has not changed. We continuously evaluate and assess our operating strategies to ensure they are effective and put us in the best position to address changes in the market. We actively manage our properties to maximize rents and maintain occupancy levels by attracting and retaining a strong and diverse base of tenants and replacing less relevant, weaker, underperforming tenants with stronger ones. Our properties are generally located in some of the most densely populated and affluent areas of the country. These strong demographics help our tenants generate higher sales, which has generally enabled us to maintain higher occupancy rates, charge higher rental rates, and maintain steady rent growth, all of which increase the value of our portfolio. Our operating strategies also include:
increasing rental rates through the renewal of expiring leases or the leasing of space to new tenants at higher rental rates while limiting vacancy and down-time;
maintaining a diversified tenant base, thereby limiting exposure to any one tenant’s financial or operating difficulties;
monitoring the merchandising mix of our tenant base to achieve a balance of strong national and regional tenants with local specialty tenants;
minimizing overhead and operating costs;
monitoring the physical appearance of our properties and the construction quality, condition and design of the buildings and other improvements located on our properties to maximize our ability to attract customers and thereby generate higher rents and occupancy rates;
managing our properties to take into account their impact on climate change and their resilience in the face of climate change;
developing local and regional market expertise in order to capitalize on market and retailing trends;
leveraging the contacts and experience of our management team to build and maintain long-term relationships with tenants;
providing exceptional customer service; and
creating an experience at many of our properties that is identifiable, unique and serves the surrounding communities to help insulate these properties and the tenants at these properties from the impact of on-line retailing.

Investing Strategies
Our investment strategy is to deploy capital at risk-adjusted rates of return that exceed our long-term weighted average cost of capital in projects that have potential for future income growth and increased value. Our investments primarily fall into one of the following four categories:
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renovating, expanding, reconfiguring and/or retenanting our existing properties to take advantage of under-utilized land or existing square footage to increase revenue;
renovating or expanding tenant spaces for tenants capable of producing higher sales, and therefore, paying higher rents;
acquiring quality retail and mixed-use properties located in densely populated and/or affluent areas where barriers to entry for further development are high, and that have possibilities for enhancing operating performance and creating value through renovation, expansion, reconfiguration and/or retenanting; and
developing the retail portions of mixed-use properties and developing or otherwise investing in non-retail portions of mixed-use properties we already own in order to capitalize on the overall value created in these properties.
Investment Criteria
When we evaluate potential redevelopment, retenanting, expansion, acquisition and development opportunities, we consider such factors as:
the expected returns in relation to our short and long-term cost of capital as well as the anticipated risk we will face in achieving the expected returns;
the anticipated growth rate of operating income generated by the property;
the ability to increase the long-term value of the property through redevelopment and retenanting;
the tenant mix at the property, tenant sales performance and the creditworthiness of those tenants;
the geographic area in which the property is located, including the population density, household incomes, education levels, as well as the population and income trends in that geographic area. This may from time to time include the evaluation of new markets;
competitive conditions in the vicinity of the property, including gross leasable area (GLA) per capita, competition for tenants and the ability of others to create competing properties through redevelopment, new construction or renovation;
access to and visibility of the property from existing roadways and the potential for new, widened or realigned, roadways within the property’s trade area, which may affect access and commuting and shopping patterns;
the level and success of our existing investments in the market area;
the current market value of the land, buildings and other improvements and the potential for increasing those market values; and
the physical condition of the land, buildings and other improvements, including the structural and environmental condition.
Financing Strategies
Our financing strategies are designed to enable us to maintain an investment grade balance sheet while retaining sufficient flexibility to fund our operating and investing activities in the most cost-efficient way possible. As a result of the ongoing COVID-19 pandemic and its impact on our cash flows, we have been maintaining levels of cash significantly in excess of the cash balances we have historically maintained. Our financing strategies include:
maintaining a prudent level of overall leverage and an appropriate pool of unencumbered properties that is sufficient to support our unsecured borrowings;
managing our exposure to variable-rate debt;
maintaining sufficient levels of cash and available line of credit to fund operating and investing needs on a short-term basis;
taking advantage of market opportunities to refinance existing debt, reduce interest costs and manage our debt maturity schedule so that a significant portion of our debt relative to our size does not mature in any one year;
selling properties that have limited growth potential or are not a strategic fit within our overall portfolio and redeploying the proceeds to redevelop, renovate, retenant and/or expand our existing properties, acquire new properties or reduce debt; and
utilizing the most advantageous long-term source of capital available to us to finance redevelopment and acquisition opportunities, which may include:
the sale of our equity or debt securities through public offerings, including our at-the-market ("ATM") equity program in which we may from time to time offer and sell common shares including through forward sales contracts, or private placements,
the incurrence of indebtedness through unsecured or secured borrowings,
the issuance of units in our operating partnership (generally issued in exchange for a tax deferred contribution of property); these units typically receive the same distributions as our common shares and the holders of these units have the right to exchange their units for cash or common shares at our option, or
the use of joint venture arrangements.
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Human Capital
At February 7, 2022, we had 310 full-time employees and 5 part-time employees. None of our employees are represented by a collective bargaining unit. We believe that our relationship with our employees is good.
Diversity and Inclusion
We are an Equal Opportunity/Affirmative action employer, and strive to maintain a workplace that is free from discrimination on the basis of race, color, religion, sex, sexual orientation, nationality, disability, or protected Veteran status.
Health, Safety, and Wellness
We are committed to the health, safety, and wellness of our employees, and foster an environment that allows our people to succeed while balancing work and life. We provide our employees with access to health and wellness programs, which includes benefits that support both physical and mental health. In response to the COVID-19 pandemic, we implemented significant changes that were in the best interest of our employees and to comply with government regulations. This includes implementing additional safety measures for our employees as we have transitioned to a hybrid work model.
Compensation and Benefits
We provide competitive pay and benefits including health, dental, vision, short and long-term disability, life insurance and a 401(k) retirement program, as well as a generous paid time off program that includes vacation, sick, and personal leave. In addition to our equity awards program, we also offer a quarterly recognition program, as well as rewarding employees with spot bonuses for stellar performance or going above and beyond the base requirements of their job description.
Talent Development
Employees have access to a variety of different training courses, books, book summaries and audio books, and an array of source materials covering a myriad of different business and soft skills training subjects. Additionally, we provide reimbursement for tuition and professional licensures.
Community Involvement
Giving back to the community is an integral part of who we are and what we do. We provide ample ways to give back through programs at our properties or charitable endeavors and volunteer opportunities that also serve as team building exercises for our employees.
Tax Status
We elected to be taxed as a REIT under the federal income tax laws when we filed our 1962 tax return. As a REIT, we are generally not subject to federal income tax on taxable income that we distribute to our shareholders. Under the Code, REITs are subject to numerous organizational and operational requirements, including the requirement to generally distribute at least 90% of taxable income each year. We will be subject to federal income tax on our taxable income (including, for our taxable years ending on or prior to December 31, 2017, any applicable alternative minimum tax) at regular corporate rates if we fail to qualify as a REIT for tax purposes in any taxable year, or to the extent we distribute less than 100% of our taxable income. We will also generally not qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost. Even if we qualify as a REIT for federal income tax purposes, we may be subject to certain state and local income and franchise taxes and to federal income and excise taxes on our undistributed taxable income.
We have elected to treat certain of our subsidiaries as taxable REIT subsidiaries, which we refer to as a TRS. In general, a TRS may engage in any real estate business and certain non-real estate businesses, subject to certain limitations under the Code. A TRS is subject to federal and state income taxes. Our TRS activities have not been material.
Impacts of COVID-19 Pandemic
In March 2020, the World Health Organization declared the outbreak of novel coronavirus disease ("COVID-19") as a pandemic. While we currently expect the impact to our properties is temporary in nature, the extent of the future effects of COVID-19 on our business, operating strategies, results of operations, cash flows, and growth prospects is highly uncertain and will ultimately depend on future developments, none of which can be predicted with any certainty. Refer to Item 7 for further discussion of the impacts of COVID-19 on our business.
Governmental Regulations Affecting Our Properties
We and our properties are subject to a variety of federal, state and local environmental, health, safety and similar laws. Please see Item 1A. "Risk Factors - Risk Factors Related to our REIT Status and Other Laws and Regulations" for further discussion of potential material effects of our compliance with government regulation, including environmental regulations and the rules governing REITs.
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The application of these laws to a specific property that we own depends on a variety of property-specific circumstances, including the current and former uses of the property, the building materials used at the property and the physical layout of the property. Under certain environmental laws, we, as the owner or operator of properties currently or previously owned, may be required to investigate and clean up certain hazardous or toxic substances, asbestos-containing materials, or petroleum product releases at the property. We may also be held liable to a governmental entity or third parties for property damage and for investigation and clean up costs incurred in connection with the contamination, whether or not we knew of, or were responsible for, such contamination. In addition, some environmental laws create a lien on the contaminated site in favor of the government for damages and costs it incurs in connection with the contamination. As the owner or operator of real estate, we also may be liable under common law to third parties for damages and injuries resulting from environmental contamination emanating from the real estate. Such costs or liabilities could exceed the value of the affected real estate. The presence of contamination or the failure to remediate contamination may adversely affect our ability to sell or lease real estate or to borrow using the real estate as collateral.
Neither existing environmental, health, safety and similar laws nor the costs of our compliance with these laws has had a material adverse effect on our financial condition or results of operations, and management does not believe they will in the future. In addition, we have not incurred, and do not expect to incur, any material costs or liabilities due to environmental contamination at properties we currently own or have owned in the past. However, we cannot predict the impact of new or changed laws or regulations on properties we currently own or may acquire in the future. We have no current plans for substantial capital expenditures with respect to compliance with environmental, health, safety and similar laws and we carry environmental insurance which covers a number of environmental risks for most of our properties.
Competition
Numerous commercial developers and real estate companies compete with us with respect to the leasing and the acquisition of properties. Some of these competitors may possess greater capital resources than we do, although we do not believe that any single competitor or group of competitors in any of the primary markets where our properties are located are dominant in that market. This competition may:
reduce the number of properties available for acquisition;
increase the cost of properties available for acquisition;
interfere with our ability to attract and retain tenants, leading to increased vacancy rates and/or reduced rents; and
adversely affect our ability to minimize expenses of operation.
Retailers at our properties also face increasing competition from online retailers, outlet stores, discount shopping clubs, superstores, and other forms of sales and marketing of goods and services, such as direct mail. This competition could contribute to lease defaults and insolvency of tenants.
Available Information
Copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) are available free of charge through the Investors section of our website at www.federalrealty.com as soon as reasonably practicable after we electronically file the material with, or furnish the material to, the Securities and Exchange Commission, or the SEC.
Our Corporate Governance Guidelines, Code of Business Conduct, Code of Ethics applicable to our Chief Executive Officer and senior financial officers, Whistleblower Policy, organizational documents and the charters of our audit committee, compensation and human capital committee and nominating and corporate governance committee are all available in the Corporate Governance section of the Investors section of our website.
Amendments to the Code of Ethics or Code of Business Conduct or waivers that apply to any of our executive officers or our senior financial officers will be disclosed in the Corporate Governance section of our website as well.

ITEM 1A.    RISK FACTORS
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Exchange Act and the Private Securities Litigation Reform Act of 1995. Also, documents that we “incorporate by reference” into this Annual Report on Form 10-K, including documents that we subsequently file with the SEC will contain forward-looking statements. When we refer to forward-looking statements or information, sometimes we use words such as “may,” “will,” “could,” “should,” “plans,” “intends,” “expects,” “believes,” “estimates,” “anticipates” and “continues.” In particular, the below risk factors describe forward-looking information. The risk factors describe risks that may
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affect these statements but are not all-inclusive, particularly with respect to possible future events. Many things can happen that can cause actual results to be different from those we describe. These factors include, but are not limited to the following:
Risk Factors Related to our Real Estate Investments and Operations
Revenue from our properties may be reduced or limited if the retail operations of our tenants are not successful.
Revenue from our properties depends primarily on the ability of our tenants to pay the full amount of rent and other charges due under their leases on a timely basis. Some of our leases provide for the payment, in addition to base rent, of additional rent above the base amount according to a specified percentage of the gross sales generated by the tenants and generally provide for reimbursement of real estate taxes and expenses of operating the property. Economic, legal, and/or competitive conditions, as well as COVID-19, may impact the success of our tenants’ retail operations and therefore the amount of rent and expense reimbursements we receive from our tenants. Any reduction in our tenants' abilities to pay base rent, percentage rent, or other charges on a timely basis, including the closing of stores prior to the end of the lease term or the filing by any of our tenants for bankruptcy protection, will adversely affect our financial condition and results of operations. In the event of default by a tenant, we may experience delays and unexpected costs in enforcing our rights as landlord under lease terms, which may also adversely affect our financial condition and results of operations.
Our net income depends on the success and continued presence of our “anchor” tenants.
Our net income could be adversely affected in the event of a downturn in the business, or the bankruptcy or insolvency, of any anchor store or anchor tenant. Anchor tenants generally occupy large amounts of square footage, pay a significant portion of the total rents at a property and contribute to the success of other tenants by drawing significant numbers of customers to a property. The closing of one or more anchor stores at a property could adversely affect that property and result in lease terminations by, or reductions in rent from, other tenants whose leases may permit termination or rent reduction in those circumstances or whose own operations may suffer as a result. Over the past several years, we have seen higher levels of anchor turnover and closings in some markets, which has caused an oversupply of larger retail spaces. Therefore, tenant demand for certain of our anchor spaces may decrease and as a result, we may see an increase in vacancy and/or a decrease in rents for those spaces that could have a negative impact to our net income. As of December 31, 2021, our anchor tenant space is 96.8% leased and 94.4% occupied.

A shift in retail shopping from brick and mortar stores to online shopping may have an adverse impact on our cash flow, financial condition and results of operations.
Many retailers operating brick and mortar stores have made online sales a vital piece of their business. The shift to online shopping may cause declines in brick and mortar sales generated by certain of our tenants and may cause certain of our tenants to reduce the size or number of their retail locations in the future. This risk is partially mitigated by our strategy of maintaining a diverse portfolio of retail properties. The trend of retailers utilizing brick and mortar locations for ‘showroom’ and on-line sales distribution purposes (particularly at shopping centers in densely populated areas like ours) may further mitigate this risk. However, there can be no assurance that our shopping centers will not be further impacted by the shift to online shopping. As a result, our cash flow, financial condition, and results of operations could be adversely affected.

We have properties that are geographically concentrated, and adverse economic or real estate market declines in these areas could have a material adverse effect on us.
As of December 31, 2021, our tenants operated in 12 states and the District of Columbia. Any adverse situation that disproportionately affects the the markets where our properties are concentrated may have a magnified adverse effect on our portfolio. Refer to “Properties” (Item 2 of this Annual Report on Form 10-K) for additional discussion of the geographic concentration. Real estate markets are subject to economic downturns, as they have been in the past, and we cannot predict how economic conditions will impact this market in both the short and long term.
Declines in the economy or a decline in the real estate market in these states could hurt our financial performance and the value of our properties. Factors that may negatively affect economic conditions in these states include:
    
business layoffs or downsizing;
industry slowdowns;
increased business restrictions due to health crises;
relocations of businesses;
changing demographics;
increased telecommuting and use of alternative work places;
infrastructure quality;
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any oversupply of, or reduced demand for, real estate;
concessions or reduced rental rates under new leases for properties where tenants defaulted; and
increased operating costs including insurance premiums and real estate taxes.
We may be unable to collect balances due from tenants that file for bankruptcy protection.
If a tenant or lease guarantor files for bankruptcy, we may not be able to collect all pre-petition amounts owed by that party. In addition, a tenant that files for bankruptcy protection may terminate our lease in which event we would have a general unsecured claim that would likely be for less than the full amount owed to us for the remainder of the lease term, which could adversely affect our financial condition and results of operations.
We may experience difficulty or delay in renewing leases or re-leasing space.
We derive most of our revenue directly or indirectly from rent received from our tenants. We are subject to the risks that, upon expiration or termination of leases, whether by their terms, as a result of a tenant bankruptcy, general economic conditions or otherwise, leases for space in our properties may not be renewed, space may not be re-leased, or the terms of renewal or re-lease, including the cost of required renovations or concessions to tenants, may be less favorable than current lease terms and may include decreases in rental rates. As a result, our net income could be reduced.
Our development activities have inherent risks.
The ground-up development of improvements on real property, as opposed to the renovation and redevelopment of existing improvements, presents substantial risks. We generally do not look to acquire raw land for future development; however, we do intend to complete the development and construction of future phases of projects we already own. We may undertake development of these and other projects on our own or bring in third parties if it is justifiable on a risk-adjusted return basis. We may also choose to delay completion of a project if market conditions do not allow an appropriate return. If conditions arise and we are not able or decide not to complete a project or if the expected cash flows of our project do not exceed the book value, an impairment of the project may be required. If additional phases of any of our existing projects or if any new projects are not successful, it may adversely affect our financial condition and results of operations.
In addition to the risks associated with real estate investment in general, as described elsewhere and the specific risks above, the risks associated with our remaining development activities include:
contractor changes may delay the completion of development projects and increase overall costs;
significant time lag between commencement and stabilization subjects us to greater risks due to fluctuations in the general economy;
delivery of residential product into uncertain residential environments may result in lower rents or longer time periods to reach economic stabilization;
substantial amount of our investment is related to infrastructure and the overall value of the project may be negatively impacted if we do not complete subsequent phases;
failure or inability to obtain construction or permanent financing on favorable terms;
expenditure of money and time on projects that may never be completed;
difficulty securing key anchor or other tenants may impact occupancy rates and projected revenue;
inability to achieve projected rental rates or anticipated pace of lease-up;
higher than estimated construction or operating costs, including labor and material costs; and
possible delay in completion of a project because of a number of factors, including COVID-19, supply chain disruptions and shortages, weather, labor disruptions, construction delays or delays in receipt of zoning or other regulatory approvals, acts of terror or other acts of violence, or acts of God (such as fires, earthquakes or floods).
Redevelopments and acquisitions may fail to perform as expected.
Our investment strategy includes the redevelopment and acquisition of high quality, retail focused properties in densely populated areas with high average household incomes and significant barriers to adding competitive retail supply. The redevelopment and acquisition of properties entail risks that include the following, any of which could adversely affect our results of operations and our ability to meet our obligations:
our estimate of the costs to improve, reposition or redevelop a property may prove to be too low, or the time we estimate to complete the improvement, repositioning or redevelopment may be too short. As a result, the property may fail to achieve the returns we have projected, either temporarily or for a longer period;
we may not be able to identify suitable properties to acquire or may be unable to complete the acquisition of the properties we identify;
we may not be able to integrate an acquisition into our existing operations successfully;
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properties we redevelop or acquire may fail to achieve the occupancy or rental rates we project, within the time frames we project, at the time we make the decision to invest, which may result in the properties’ failure to achieve the returns we projected;
our pre-acquisition evaluation of the physical condition of each new investment may not detect certain defects or identify necessary repairs until after the property is acquired, which could significantly increase our total acquisition costs or decrease cash flow from the property; and
our investigation of a property or building prior to our acquisition, and any representations we may receive from the seller of such building or property, may fail to reveal various liabilities, which could reduce the cash flow from the property or increase our acquisition cost.
Our performance and value are subject to general risks associated with the real estate industry.
Our economic performance and the value of our real estate assets, and consequently, the value of our investments, are subject to the risk that if our properties do not generate revenues sufficient to meet our operating expenses, including debt service and capital expenditures, our cash flow and ability to pay distributions to our shareholders will be adversely affected. As a real estate company, we are susceptible to the following real estate industry risks:
economic downturns in general, or in the areas where our properties are located;
adverse changes in local real estate market conditions, such as an oversupply or reduction in demand;
changes in tenant preferences that reduce the attractiveness of our properties to tenants;
zoning or regulatory restrictions;
decreases in market rental rates;
weather conditions that may increase or decrease energy costs and other weather-related expenses;
costs associated with the need to periodically repair, renovate and re-lease space; and
increases in the cost of adequate maintenance, insurance and other operating costs, including real estate taxes, associated with one or more properties, which may occur even when circumstances such as market factors and competition cause a reduction in revenues from one or more properties, although real estate taxes typically do not increase upon a reduction in such revenues.
Each of these risks could result in decreases in market rental rates and increases in vacancy rates, which could adversely affect our financial condition and results of operation.
Many real estate costs are fixed, even if income from our properties decreases.
Our financial results depend primarily on leasing space in our properties to tenants on terms favorable to us. Costs associated with real estate investment, such as real estate taxes, insurance and maintenance costs, generally are not reduced even when a property is not fully occupied, rental rates decrease, or other circumstances cause a reduction in income from the property. As a result, cash flow from the operations of our properties may be reduced if a tenant does not pay its rent or we are unable to rent our properties on favorable terms. Under those circumstances, we might not be able to enforce our rights as landlord without delays and may incur substantial legal costs. Additionally, new properties that we may acquire or redevelop may not produce any significant revenue immediately, and the cash flow from existing operations may be insufficient to pay the operating expenses and debt service associated with such new properties until they are fully occupied.
Competition may limit our ability to purchase new properties and generate sufficient income from tenants.
Numerous commercial developers and real estate companies compete with us in seeking tenants for our existing properties and properties for acquisition. This competition may:
reduce properties available for acquisition;
increase the cost of properties available for acquisition;
reduce rents payable to us;
interfere with our ability to attract and retain tenants;
lead to increased vacancy rates at our properties; and
adversely affect our ability to minimize expenses of operation.
Retailers at our properties also face increasing competition from online retailers, outlet stores, discount shopping clubs and other forms of sales and marketing of goods, such as direct mail. This competition could contribute to lease defaults and insolvency of tenants. If we are unable to continue to attract appropriate retail tenants to our properties, or to purchase new properties in our geographic markets, it could materially affect our ability to generate net income, service our debt and make distributions to our shareholders.
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We may be unable to sell properties when appropriate because real estate investments are illiquid.
Real estate investments generally cannot be sold quickly. In addition, there are some limitations under federal income tax laws applicable to real estate and to REITs in particular that may limit our ability to sell our assets. We may not be able to alter our portfolio promptly in response to changes in economic or other conditions including being unable to sell a property at a return we believe is appropriate due to the economic environment. Our inability to respond quickly to adverse changes in the performance of our investments could have an adverse effect on our ability to meet our obligations and make distributions to our shareholders.
We may have limited flexibility in dealing with our jointly owned investments.
Our organizational documents do not limit the amount of funds that we may invest in properties and assets owned jointly with other persons or entities. As of December 31, 2021, we held 19 predominantly retail real estate projects jointly with other persons in addition to properties owned in a “downREIT” structure. Additionally, as of December 31, 2021, we owned an interest in the hotel component of Assembly Row. We may make additional joint investments in the future. Our existing and future joint investments may subject us to special risks, including the possibility that our partners or co-investors might become bankrupt, that those partners or co-investors might have economic or other business interests or goals which are unlike or incompatible with our business interests or goals, that those partners or co-investors might be in a position to take action contrary to our suggestions or instructions, or in opposition to our policies or objectives, and that disputes may develop with our joint venture partners over decisions affecting the property or the joint venture, which may result in litigation or arbitration or some other form of dispute resolution. Although as of December 31, 2021, we held the controlling interests in all of our existing co-investments (except the hotel investment discussed above and the investment in the La Alameda shopping center acquired in 2017), we generally must obtain the consent of the co-investor or meet defined criteria to sell or to finance these properties. Joint ownership gives a third party the opportunity to influence the return we can achieve on some of our investments and may adversely affect our ability to make distributions to our shareholders. We may also be liable for the actions of our co-investors.
Our insurance coverage on our properties may be inadequate.
We currently carry comprehensive insurance on all of our properties, including insurance for liability, fire, flood, earthquake, environmental matters, rental loss and acts of terrorism. All of these policies contain coverage limitations. We believe these coverages are of the types and amounts customarily obtained for or by an owner of similar types of real property assets located in the areas where our properties are located. We intend to obtain similar insurance coverage on subsequently acquired properties.
The availability of insurance coverage may decrease and the prices for insurance may increase as a consequence of significant losses incurred by the insurance industry and other factors outside our control. As a result, we may be unable to renew or duplicate our current insurance coverage in adequate amounts or at reasonable prices. In addition, insurance companies may no longer offer coverage against certain types of losses, such as losses due to terrorist acts, pandemics, and toxic mold, or, if offered, the expense of obtaining these types of insurance may not be justified. We therefore may cease to have insurance coverage against certain types of losses and/or there may be decreases in the limits of insurance available. If an uninsured loss or a loss in excess of our insured limits occurs, we could lose all or a portion of the capital we have invested in a property, as well as the anticipated future revenue from the property, but still remain obligated for any mortgage debt or other financial obligations related to the property. We cannot guarantee that material losses in excess of insurance proceeds will not occur in the future. If any of our properties were to experience a catastrophic loss, it could seriously disrupt our operations, delay revenue and result in large expenses to repair or rebuild the property. Also, due to inflation, changes in codes and ordinances, environmental considerations and other factors, it may not be feasible to use insurance proceeds to replace a building after it has been damaged or destroyed. Further, we may be unable to collect insurance proceeds if our insurers are unable to pay or contest a claim. Events such as these could adversely affect our results of operations and our ability to meet our obligations, including distributions to our shareholders.
Natural disasters, climate change and health crises, including the COVID-19 pandemic, could have an adverse impact on our cash flow and operating results.
Climate change may add to the unpredictability and frequency of natural disasters and severe weather conditions and create additional uncertainty as to future trends and exposures. Certain of our operations are located in areas that are subject to natural disasters and severe weather conditions such as hurricanes, earthquakes, droughts, snow storms, floods and fires.  The impact of climate change or the occurrence of natural disasters can delay new development projects, increase investment costs to repair or replace damaged properties, increase operating costs, create additional investment costs to make improvements to existing properties to comply with climate change regulations, increase future property insurance costs, and negatively impact the tenant demand for space.  If insurance is unavailable to us or is unavailable on acceptable terms, or if our insurance is not adequate to cover business interruption or losses from these events, our earnings, liquidity or capital resources could be adversely affected.
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In addition, our business is subject to risks related to the effects of public health crises, epidemics and pandemics, including the
COVID-19 pandemic. Such events could:
inhibit global, national and local economic activity;
drive inflation, adversely affect trading activity in securities markets, which could negatively impact the trading prices of our common shares and debt securities and our ability to access the securities markets as a source of liquidity;
adversely affect our tenants’ financial condition by limiting foot traffic and staffing at their businesses, which could affect their ability to pay rent and willingness to make new leasing commitments;
reduce our cash flow, which could impact our ability to pay dividends at the current rate and in the current format or at all or to service our debt;
temporarily or permanently reduce the demand for retail or office space;
interfere with our business operations by requiring our personnel to work remotely;
increase the frequency of cyber-attacks;
disrupt supply chains that could be important in our development and redevelopment activities;
result in labor shortages;
interfere with potential purchases and sales of properties;
impact our ability to pay dividends at the current rate and in the current format or at all; and
have other direct and indirect effects that are difficult to predict.
Such risks depend upon the nature and severity of the public health concern, as well as the extent and duration of government-mandated orders and personal decisions to limit travel, economic activity and personal interaction, none of which can be predicted with confidence. In particular, we cannot predict the impact of stay-at-home and other government orders instituted in response to the COVID-19 pandemic, which vary by jurisdiction, or the pandemics' short and long term economic effects, each of which could have a material adverse effect on our business.

An increased focus on metrics and reporting related to corporate responsibility, specifically related to environmental, social and governance ("ESG") factors, may impose additional costs and expose us to new risks.
Investors and other stakeholders have become more focused on understanding how companies address a variety of ESG factors. Many of those investors and shareholders look to ESG rating systems that have been developed by third party groups to allow comparisons between companies on ESG factors as they evaluate investment decisions as well as to company disclosures. Although we participate in many of these ratings systems and generally score relatively well in those in which we do participate, we do not participate in, and would not necessarily score well in, all of the available ratings systems. Further, the criteria used in these ratings systems change frequently, and we cannot guaranty that we will be able to score well as criteria change. We supplement our participation in ratings systems with corporate disclosures of our ESG activities but many investors and stakeholders may look for specific disclosures that we do not provide. Failure to participate in certain of the third party ratings systems, failure to score well in those ratings systems or failure to provide certain ESG disclosures could result in reputational harm when investors or others compare us against similar companies in our industry and could cause certain investors to be unwilling to invest in our stock which could adversely impact our ability to raise capital.
For more information about the Trust's Corporate Responsibility initiatives, see Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations - Corporate Responsibility."

Risk Factors Related to our Funding Strategies and Capital Structure
The amount of debt we have and the restrictions imposed by that debt could adversely affect our business and financial condition.
As of December 31, 2021, we had approximately $4.1 billion of debt outstanding. Of that outstanding debt, approximately $341.6 million was secured by all or a portion of 7 of our real estate projects. As of December 31, 2021, approximately 92.6% of our debt is fixed rate or is fixed via interest rate swap agreements, which includes all of our property secured debt and our unsecured senior notes. Our organizational documents do not limit the level or amount of debt that we may incur. The amount of our debt outstanding from time to time could have important consequences to our shareholders. For example, it could:
require us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for operations, property acquisitions, redevelopments and other appropriate business opportunities that may arise in the future;
limit our ability to make distributions on our outstanding common shares and preferred shares;
make it difficult to satisfy our debt service requirements;
require us to dedicate increased amounts of our cash flow from operations to payments on debt upon refinancing or on our variable rate, unhedged debt, if interest rates rise;
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limit our flexibility in planning for, or reacting to, changes in our business and the factors that affect the profitability of our business;
limit our ability to obtain any additional debt or equity financing we may need in the future for working capital, debt refinancing, capital expenditures, acquisitions, redevelopments or other general corporate purposes or to obtain such financing on favorable terms; and/or
limit our flexibility in conducting our business, which may place us at a disadvantage compared to competitors with less debt or debt with less restrictive terms.
Our ability to make scheduled principal payments of, to pay interest on, or to refinance our indebtedness will depend primarily on our future performance, which to a certain extent is subject to economic, financial, competitive and other factors beyond our control. There can be no assurance that our business will continue to generate sufficient cash flow from operations in the future to service our debt or meet our other cash needs. If we are unable to generate this cash flow from our business, we may be required to refinance all or a portion of our existing debt, sell assets or obtain additional financing to meet our debt obligations and other cash needs, including the payment of dividends required to maintain our status as a real estate investment trust. We cannot assure you that any such refinancing, sale of assets or additional financing would be possible on terms that we would find acceptable.
We are obligated to comply with financial and other covenants pursuant to our debt obligations that could restrict our operating activities, and the failure to comply with such covenants could result in defaults that accelerate payment under our debt agreements.
Our revolving credit facility, unsecured term loan, and certain series of notes include financial covenants that may limit our operating activities in the future. We are also required to comply with additional covenants that include, among other things, provisions:
relating to the maintenance of property securing a mortgage;
restricting our ability to pledge assets or create liens;
restricting our ability to incur additional debt;
restricting our ability to amend or modify existing leases at properties securing a mortgage;
restricting our ability to enter into transactions with affiliates; and
restricting our ability to consolidate, merge or sell all or substantially all of our assets.
As of December 31, 2021, we were in compliance with all of our default related financial covenants. If we were to breach any of our default related debt covenants, including the covenants listed above, and did not cure the breach within any applicable cure period, our lenders could require us to repay the debt immediately, and, if the debt is secured, could immediately begin proceedings to take possession of the property securing the loan. Many of our debt arrangements, including our public notes and our revolving credit facility, are cross-defaulted, which means that the lenders under those debt arrangements can put us in default and require immediate repayment of their debt if we breach and fail to cure a default under certain of our other debt obligations. As a result, any default under our debt covenants could have an adverse effect on our financial condition, our results of operations, our ability to meet our obligations and the market value of our shares.
Adverse changes in our credit rating could affect our borrowing capacity and borrowing terms.
Our credit worthiness is rated by nationally recognized credit rating agencies. The credit ratings assigned are based on our operating performance, liquidity and leverage ratios, financial condition and prospects, and other factors viewed by the credit rating agencies as relevant to our industry and the economic outlook in general. Our credit rating can affect the amount of capital we access, as well as the terms of certain existing and future financing we obtain. Since we depend on debt financing to fund the growth of our business, an adverse change in our credit rating, including actual changes in outlook, or even the initiation of review of our credit rating that could result in an adverse change, could have a material adverse effect on us.
Our ability to grow will be limited if we cannot obtain additional capital.
Our growth strategy is focused on the development and redevelopment of properties we already own and the acquisition of additional properties. We believe that it will be difficult to fund our expected growth with cash from operating activities because, in addition to other requirements, we are generally required to distribute to our shareholders at least 90% of our taxable income each year to continue to qualify as a REIT for federal income tax purposes. As a result, we must rely primarily upon the availability of debt or equity capital, which may or may not be available on favorable terms or at all. Debt could include the sale of debt securities and mortgage loans from third parties. If economic conditions and conditions in the capital markets are not favorable at the time we need to raise capital, we may need to obtain capital on less favorable terms. Additionally, we cannot guarantee that additional financing, refinancing or other capital will be available in the amounts we desire or on favorable terms. Our access to debt or equity capital depends on a number of factors, including the market’s
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perception of our growth potential and risk profile, our ability to pay dividends, and our current and potential future earnings. Depending on the outcome of these factors as well as the impact of the economic environment, we could experience delay or difficulty in implementing our growth strategy on satisfactory terms, or be unable to implement this strategy.
Rising interest rates could adversely affect our cash flow and the market price of our outstanding debt and preferred shares.
Of our $4.1 billion of debt outstanding as of December 31, 2021, approximately $356.5 million bears interest at a variable rate, of which, $300.0 million is our unsecured term loan that bears interest at a variable rate of LIBOR plus 80 basis points and $56.5 million in mortgages payable that bear interest at a variable rate of LIBOR plus 195 basis points and are effectively fixed through two interest rate swap agreements. We also have a $1.0 billion revolving credit facility, on which no balance was outstanding at December 31, 2021, that bears interest at LIBOR plus 77.5 basis points. We may borrow additional funds at variable interest rates in the future. Increases in interest rates would increase the interest expense on our variable rate debt and reduce our cash flow, which could adversely affect our ability to service our debt and meet our other obligations and also could reduce the amount we are able to distribute to our shareholders. We may enter into additional hedging arrangements or other transactions for all or a portion of our variable rate debt to limit our exposure to rising interest rates. However, the amounts we are required to pay under variable rate debt to which hedging or similar arrangements relate may increase in the event of non-performance by the counterparties to any such hedging arrangements. In addition, an increase in market interest rates may lead purchasers of our debt securities and preferred shares to demand a higher annual yield, which could adversely affect the market price of our outstanding debt securities and preferred shares and the cost and/or timing of refinancing or issuing additional debt securities or preferred shares.
The phase-out of LIBOR could affect interest rates under our variable rate debt and interest rate swap arrangements.
LIBOR is used as a reference rate for our revolving credit facility, certain mortgage payables, and in our interest rate swap arrangements. On July 27, 2017, the United Kingdom's Financial Conduct Authority announced it intends to stop compelling banks to submit rates for the calculation of LIBOR after 2021. On November 30, 2020, the ICE Benchmark Administration Limited announced its plan to extend the date that most U.S. LIBOR values would cease being computed and published from December 31, 2021 to June 30, 2023. The Federal Reserve Board and the Federal Reserve Bank of New York organized the Alternative Reference Rates Committee which identified the Secured Overnight Financing Rate ("SOFR") as its preferred alternative to U.S. dollar LIBOR in derivatives and other financial contracts. At this time, we can not predict the effect of any discontinuance, modification or other reforms to LIBOR, or if SOFR, or another alternative rate reference rate, attains market traction as a LIBOR replacement. As LIBOR phases out and ceases to exist, we will need to agree upon a benchmark replacement index with the bank, and as such the interest rate on our revolving credit facility and certain mortgage payables may change. The new rate may not be as favorable as those in effect prior to any LIBOR phase-out. Furthermore, the transition process may result in delays in funding, higher interest expense, additional expenses, and increased volatility in markets for instruments that currently rely on LIBOR, all of which could negatively impact our cash flow.
Risk Factors Related to our REIT Status and Other Laws and Regulations
Environmental laws and regulations could reduce the value or profitability of our properties.
All real property and the operations conducted on real property are subject to federal, state and local laws, ordinances and regulations relating to hazardous materials, environmental protection and human health and safety. Under various federal, state and local laws, ordinances and regulations, we and our tenants may be responsible for the disposal or treatment of hazardous or toxic substances released on or in properties we own or operate, as well as certain other potential costs relating to hazardous or toxic substances (including governmental fines and injuries to persons and property). This liability may be imposed whether or not we knew about, or were responsible for, the presence of hazardous or toxic substances. Further, the presence of contamination on our properties or the failure to properly remediate contamination at any of our properties may adversely affect our ability to sell or lease those properties or to borrow funds by using those properties as collateral. The costs or liabilities could exceed the value of the affected real estate. We are not aware of any environmental condition with respect to any of our properties that management believes would have a material adverse effect on our business, assets or results of operations taken as a whole.

In addition, changes in government legislation and regulation on climate change could result in increased capital expenditures to improve the energy efficiency of our existing properties and could also require us to spend more on our development or redevelopment projects without a corresponding increase in revenues, which may adversely affect our financial condition, results of operations and cash flows.
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The Americans with Disabilities Act of 1990 could require us to take remedial steps with respect to existing or newly acquired properties.
Our existing properties, as well as properties we may acquire, as commercial facilities, are required to comply with Title III of the Americans with Disabilities Act of 1990. Investigation of a property may reveal non-compliance with this Act. The requirements of this Act, or of other federal, state or local laws or regulations, also may change in the future and restrict further renovations of our properties with respect to access for disabled persons. Future compliance with this Act may require expensive changes to the properties.
The revenues generated by our tenants could be negatively affected by various federal, state and local laws to which they are subject.
We and our tenants are subject to a wide range of federal, state and local laws and regulations, such as local licensing requirements, consumer protection laws and state and local fire, life-safety and similar requirements that affect the use of the properties. The leases typically require that each tenant comply with all laws and regulations. Failure to comply could result in fines by governmental authorities, awards of damages to private litigants, or restrictions on the ability to conduct business on such properties. Non-compliance of this sort could reduce our revenues from a tenant, could require us to pay penalties or fines relating to any non-compliance, and could adversely affect our ability to sell or lease a property.
Failure to qualify as a REIT for federal income tax purposes would cause the Parent Company to be taxed as a corporation, which would substantially reduce funds available for payment of distributions.
We believe that we are organized and qualified as a REIT for federal income tax purposes and currently intend to operate in a manner that will allow us to continue to qualify as a REIT under the Code. However, we cannot assure you that we will remain qualified as such in the future.
Qualification as a REIT involves the application of highly technical and complex Code provisions and applicable income tax regulations that have been issued under the Code. Certain facts and circumstances not entirely within our control may affect our ability to qualify as a REIT. For example, in order to qualify as a REIT, at least 95% of our gross income in any year must be derived from qualifying rents and certain other income. Satisfying this requirement could be difficult, for example, if defaults by tenants were to reduce the amount of income from qualifying rents. As a REIT, we must generally make annual distributions to shareholders of at least 90% of our taxable income. In addition, new legislation, new regulations, new administrative interpretations or new court decisions may significantly change the tax laws with respect to qualification as a REIT or the federal income tax consequences of such qualification. Any modification in the tax treatment of REITs could have a significant adverse impact to our net income.
If we fail to qualify as a REIT:
we would not be allowed a deduction for distributions to shareholders in computing taxable income;
we would be subject to federal income tax at regular corporate rates;
unless we are entitled to relief under specific statutory provisions, we could not elect to be taxed as a REIT for four taxable years following the year during which we were disqualified;
we could be required to pay significant income taxes, which would substantially reduce the funds available for investment or for distribution to our shareholders for each year in which we failed or were not permitted to qualify; and
we would no longer be required by law to make any distributions to our shareholders.
To maintain our status as a REIT, we limit the amount of shares any one shareholder of the Parent Company can own.
The Code imposes certain limitations on the ownership of the stock of a REIT. For example, not more than 50% in value of our outstanding shares of capital stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the Code) during the last half of any taxable year. To protect our REIT status, the Parent Company's declaration of trust prohibits any one shareholder from owning (actually or constructively) more than 9.8% in value of the outstanding common shares or of any class or series of outstanding preferred shares. The constructive ownership rules are complex. Shares of the Parent Company's capital stock owned, actually or constructively, by a group of related individuals and/or entities may be treated as constructively owned by one of those individuals or entities. As a result, the acquisition of less than 9.8% in value of the outstanding common shares and/or a class or series of preferred shares (or the acquisition of an interest in an entity that owns common shares or preferred shares) by an individual or entity could cause that individual or entity (or another) to own constructively more than 9.8% in value of the outstanding capital stock. If that happened, either the transfer of ownership would be void or the shares would be transferred to a charitable trust and then sold to someone who can own those shares without violating the 9.8% ownership limit.
The Board of Trustees may waive these restrictions on a case-by-case basis. In addition, the Board of Trustees and two-thirds of our shareholders eligible to vote at a shareholder meeting may remove these restrictions if they determine it is no longer in our
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best interests for the Parent Company to attempt to qualify, or to continue to qualify, as a REIT. The 9.8% ownership restrictions may delay, defer or prevent a transaction or a change of our control that might involve a premium price for the common shares or otherwise be in the shareholders’ best interest.
Legislative, administrative, regulatory or other actions affecting REITs, including positions taken by the IRS, could have a material adverse effect on us and our investors.
The rules dealing with U.S. federal income taxation are constantly under review by persons involved in the legislative process, and by the Internal Revenue Service (“IRS”) and the U.S. Department of the Treasury (“Treasury”). Changes to the tax laws or interpretations thereof by the IRS and the Treasury, with or without retroactive application, could materially and adversely affect us and our investors. In particular, additional technical corrections legislation and implementing regulations may be enacted or promulgated in response to the Tax Cuts and Job Acts of 2017 (the "Act"), and substantive legislative changes to the Act are also possible. In response to the COVID-19 pandemic, multiple pieces of legislation have already been enacted, including the 2020 CARES Act, and there have also been significant issuances of regulatory and other guidance, and further legislative enactments and other IRS or Treasury action is possible. No prediction can be made as to the likelihood of passage of new tax legislation or other provisions, or the direct or indirect effect on us and our shareholders. Accordingly, such new legislation, Treasury regulations, administrative interpretations or court decisions could significantly and negatively affect our ability to qualify to be taxed as a REIT and/or the U.S. federal income tax consequences to us and our investors of such qualification.
Certain tax and anti-takeover provisions of the Parent Company's declaration of trust and bylaws, and certain restrictions in the Partnership's limited partnership agreement, may inhibit a change of our control.
Certain provisions contained in the Parent Company's declaration of trust and bylaws and the Maryland General Corporation Law, as applicable to Maryland REITs, may discourage a third party from making a tender offer or acquisition proposal to us. If this were to happen, it could delay, deter or prevent a change in control or the removal of existing management. These provisions also may delay or prevent the shareholders from receiving a premium for their common shares over then-prevailing market prices. These provisions include:
the REIT ownership limit described above;
authorization of the issuance of our preferred shares with powers, preferences or rights to be determined by the Board of Trustees;
special meetings of our shareholders may be called only by the chairman of the board, the chief executive officer, the president, by one-third of the trustees or by shareholders possessing no less than 25% of all the votes entitled to be cast at the meeting;
the Board of Trustees, without a shareholder vote, can classify or reclassify unissued shares of beneficial interest, including the reclassification of common shares into preferred shares and vice-versa;
a two-thirds shareholder vote is required to approve some amendments to the declaration of trust; and
advance-notice requirements for proposals to be presented at shareholder meetings.
In addition, if we elect to be governed by it in the future, the Maryland Control Share Acquisition Law could delay or prevent a change in control. Under Maryland law, unless a REIT elects not to be subject to this law, “control shares” acquired in a “control share acquisition” have no voting rights except to the extent approved by shareholders by a vote of two-thirds of the votes entitled to be cast on the matter, excluding shares owned by the acquirer and by officers or trustees who are employees of the REIT. “Control shares” are voting shares that would entitle the acquirer to exercise voting power in electing trustees within specified ranges of voting power. A “control share acquisition” means the acquisition of control shares, with some exceptions.
The Parent Company's bylaws state that the Maryland control share acquisition law will not apply to any acquisition by any person of our common shares. This bylaw provision may be repealed, in whole or in part, at any time, whether before or after an acquisition of control shares, by a vote of a majority of the shareholders entitled to vote, and, upon such repeal, may, to the extent provided by any successor bylaw, apply to any prior or subsequent control share acquisition.
In addition, certain provisions in the Partnership’s limited partnership agreement (the “Partnership Agreement”) may delay or make more difficult unsolicited acquisitions of us or changes in our control. These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or change of our control, although some shareholders might consider such proposals, if made, desirable. These provisions also make it more difficult for third parties to alter the management structure of the Partnership without the concurrence of our Board of Trustees. These provisions include, among others:
redemption rights of limited partners and certain assignees of units of limited partnership interest ("OP Units");
transfer restrictions on OP Units and restrictions on admissions of partners;
a requirement that the General Partner may not be removed as the general partner of the Partnership without its consent;
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the ability of the General Partner to issue preferred partnership interests in the Partnership with terms that it may determine, without the approval or consent of any Limited Partner; and
restrictions on the ability of the General Partner, the Partnership or the Parent Company to transfer its interests in the Partnership or otherwise engage in certain extraordinary transactions, including, among others, certain mergers, business combinations, sales of all or substantially all of their assets and recapitalizations.
We may be required to incur additional debt to qualify as a REIT.
As a REIT, we must generally make annual distributions to shareholders of at least 90% of our taxable income. We are subject to income tax on amounts of undistributed taxable income and net capital gain. In addition, we would be subject to a 4% excise tax if we fail to distribute sufficient income to meet a minimum distribution test based on our ordinary income, capital gain and aggregate undistributed income from prior years. We intend to make distributions to shareholders to comply with the Code’s distribution provisions and to avoid federal income and excise tax. We may need to borrow funds to meet our distribution requirements because:
our income may not be matched by our related expenses at the time the income is considered received for purposes of determining taxable income; and
non-deductible capital expenditures, creation of reserves, or debt service requirements may reduce available cash but not taxable income.
In these circumstances, we might have to borrow funds on terms we might otherwise find unfavorable and we may have to borrow funds even if our management believes the market conditions make borrowing financially unattractive. Current tax law also allows us to pay a portion of our distributions in shares instead of cash.

General Risk Factors
The market value of our debt and equity securities is subject to various factors that may cause significant fluctuations or volatility.
As with other publicly traded securities, the market price of our debt and equity securities depends on various factors, which may change from time to time and/or may be unrelated to our financial condition, operating performance or prospects that may cause significant fluctuations or volatility in such prices. These factors include, among others:
general economic and financial market conditions;
level and trend of interest rates;
our ability to access the capital markets to raise additional capital;
the issuance of additional equity or debt securities;
changes in our funds from operations (“FFO”) or earnings estimates;
changes in our credit or analyst ratings;
our financial condition and performance;
market perception of our business compared to other REITs; and
market perception of REITs, in general, compared to other investment alternatives.
We cannot assure you we will continue to pay dividends in the current composition or at historical rates.
Our ability to continue to pay dividends on our common shares at historical rates or to increase our common share dividend rate, and our ability to pay preferred share dividends and service our debt securities, will depend on a number of factors, including, among others, the following:
our financial condition and results of future operations;
the performance by our tenants under their contractual lease agreements;
the terms of our loan covenants; and
our ability to acquire, finance, develop or redevelop and lease additional properties at attractive rates.
If we do not maintain or increase, or if we change the composition of the dividend on our common shares, it could have an adverse effect on the market price of our common shares and other securities. Any preferred shares we may offer in the future may have a fixed dividend rate that would not increase with any increases in the dividend rate of our common shares. Conversely, payment of dividends on our common shares may be subject to payment in full of the dividends on any preferred shares and payment of interest on any debt securities we may offer.
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The Parent Company is a holding company with no direct operations, and it will rely on funds received from the Partnership to pay its obligations and make distributions to its shareholders.
The Parent Company is a holding company and expects to conduct substantially all of its operations through the Partnership. The Parent Company will not have, apart from an interest in the Partnership, any independent operations. As a result, the Parent Company will rely on distributions from the Partnership to make any distributions we declare on our common shares. The Parent Company will also rely on distributions from the Partnership to meet its obligations, including any tax liability on taxable income allocated to the Parent Company from the Partnership. Through its ownership and control of the General Partner, the Parent Company exercises exclusive control over the Partnership, including the authority to cause the Partnership to make distributions, subject to certain limited approval and voting rights of the Partnership’s Limited Partners as described in the Partnership Agreement. In addition, because the Parent Company is a holding company, your claims as shareholders are structurally subordinated to all existing and future liabilities and obligations to preferred equity holders of the Partnership and its subsidiaries. Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of the Partnership or its subsidiaries, assets of the Partnership or the applicable subsidiary will be available to satisfy any claims of our shareholders only after such liabilities and obligations have been satisfied in full.
We currently own 100% of the OP Units issued by the Partnership and are its sole Limited Partner. However, in connection with our future acquisition activities or otherwise, we may issue additional OP Units to third parties and admit additional Limited Partners. Such issuances would reduce the Parent Company’s percentage ownership in the Partnership.

Loss of our key management could adversely affect performance and the value of our common shares.
We are dependent on the efforts of our key management. Although we believe qualified replacements could be found for any departures of key executives, the loss of their services could adversely affect our performance and the value of our common shares.

We may adjust our business policies without shareholder approval.
We may modify our approach to investment, financing, borrowing, and other operating strategies without shareholder approval. A change in the approach to any of these items could adversely affect our financial condition and results of operations, and the market price of our securities.
Our current business plan focuses on our investment in high quality retail based properties that are typically neighborhood and community shopping centers or mixed-use properties, principally through redevelopments and acquisitions. If this business plan is not successful, it could have a material adverse effect on our financial condition and results of operations.
Given these uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements that we make, including those in this Annual Report on Form 10-K. Except as may be required by law, we make no promise to update any of the forward-looking statements as a result of new information, future events or otherwise. You should carefully review the above risks and the risk factors.
We face risks relating to cyber attacks that could cause loss of confidential information and other business disruptions.
We rely extensively on information technology systems to process transactions and manage our business, and our business is at risk from and may be impacted by cyber attacks. These could include attempts to gain unauthorized access to our data and computer systems as well as attacks on third party's information technology systems that we rely on to provide important information technology services relating to key business functions, such as payroll. Attacks can be both individual and/or highly organized attempts by very sophisticated hacking organizations. We employ a number of measures to prevent, detect and mitigate these threats, which include password encryption, multi-factor authentication, frequent password change events, firewall detection systems, anti-virus software in-place, frequent backups, a redundant data system for core applications and penetration testing; however, there is no guarantee such efforts will be successful in preventing a cyber attack. A cyber attack could compromise the confidential information of our employees, tenants and vendors. A successful attack could disrupt and otherwise adversely affect our business operations.

ITEM 1B.    UNRESOLVED STAFF COMMENTS
None.
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ITEM 2.    PROPERTIES
General
As of December 31, 2021, we owned or had a majority ownership interest in community and neighborhood shopping centers and mixed-used properties which are operated as 104 predominantly retail real estate projects comprising approximately 25.1 million square feet. These properties are located primarily in densely populated and affluent communities in strategic metropolitan markets in the Northeast and Mid-Atlantic regions of the United States, California, and South Florida. No single commercial or residential property accounted for over 10% of our 2021 total revenue. We believe that our properties are adequately covered by commercial general liability, fire, flood, earthquake, terrorism and business interruption insurance provided by reputable companies, with commercially reasonable exclusions, deductibles and limits.
Tenant Diversification
As of December 31, 2021, we had approximately 3,100 commercial leases and 3,000 residential leases, with tenants ranging from sole proprietors to major national and international retailers. No one tenant or affiliated group of tenants accounted for more than 2.7% of our annualized base rent as of December 31, 2021. As a result of our tenant diversification, we believe our exposure to any one bankruptcy filing has not been and will not be significant, however, multiple filings by a number of tenants could have a significant impact.
Geographic Diversification
Our 104 real estate projects are located in 12 states and the District of Columbia. The following table shows the number of projects, the gross leasable area (“GLA”) of commercial space and the percentage of total portfolio gross leasable area of commercial space in each state as of December 31, 2021.
 
StateNumber of
Projects
Gross Leasable
Area
Percentage
of Gross
Leasable
Area
 (In square feet)
California21 6,452,000 25.7 %
Maryland20 4,488,000 17.9 %
Virginia18 3,693,000 14.7 %
Pennsylvania10 2,090,000 8.3 %
Massachusetts2,067,000 8.3 %
New Jersey1,892,000 7.5 %
New York1,331,000 5.3 %
Florida862,000 3.4 %
Illinois799,000 3.2 %
Arizona736,000 2.9 %
Connecticut358,000 1.4 %
Michigan215,000 0.9 %
District of Columbia119,000 0.5 %
Total104 25,102,000 100.0 %

Leases, Lease Terms and Lease Expirations
Our leases are classified as operating leases and typically are structured to require the monthly payment of minimum rents in advance, subject to periodic increases during the term of the lease, percentage rents based on the level of sales achieved by tenants, and reimbursement of a majority of on-site operating expenses and real estate taxes. These features in our leases generally reduce our exposure to higher costs and allow us to participate in improved tenant sales.
Commercial property leases generally range from three to ten years; however, certain leases, primarily with anchor tenants, may be longer. Many of our leases contain tenant options that enable the tenant to extend the term of the lease at expiration at pre-established rental rates that often include fixed rent increases, consumer price index adjustments or other market rate adjustments from the prior base rent. Leases on residential units are generally for a period of one year or less and, in 2021, represented approximately 9.1% of total rental income.
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The following table sets forth the schedule of lease expirations for our commercial leases in place as of December 31, 2021 for each of the 10 years beginning with 2022 and after 2031 in the aggregate assuming that none of the tenants exercise future renewal options. Annualized base rents reflect in-place contractual rents as of December 31, 2021.
 
Year of Lease ExpirationLeased
Square
Footage
Expiring
Percentage of
Leased Square
Footage
Expiring
Annualized
Base Rent
Represented by
Expiring Leases
Percentage of  Annualized Base Rent  Represented by Expiring Leases
20221,807,000 %$50,983,000 %
20232,492,000 11 %74,952,000 11 %
20243,441,000 15 %90,401,000 13 %
20253,121,000 14 %81,484,000 12 %
20262,045,000 %67,047,000 10 %
20272,258,000 10 %75,497,000 11 %
20281,526,000 %45,807,000 %
20291,483,000 %49,632,000 %
20301,097,000 %28,530,000 %
2031768,000 %28,704,000 %
Thereafter2,819,000 12 %85,630,000 13 %
Total22,857,000 100 %$678,667,000 100 %
During 2021, we signed leases for a total of 2,193,000 square feet of retail space including 2,093,000 square feet of comparable space leases (leases for which there was a prior tenant) at an average rental increase of 7% on a cash basis. New leases for comparable spaces were signed for 1,144,000 square feet at an average rental increase of 10% on a cash basis. Renewals for comparable spaces were signed for 949,000 square feet at an average rental increase of 3% on a cash basis. Tenant improvements and incentives for comparable spaces were $37.57 per square foot, of which, $65.92 per square foot was for new leases and $3.41 per square foot was for renewals in 2021.
During 2020, we signed leases for a total of 1,756,000 square feet of retail space including 1,666,000 square feet of comparable space leases (leases for which there was a prior tenant) at an average rental increase of 3% on a cash basis. New leases for comparable spaces were signed for 595,000 square feet at an average rental increase of 4% on a cash basis. Renewals for comparable spaces were signed for 1,071,000 square feet at an average rental increase of 2% on a cash basis. Tenant improvements and incentives for comparable spaces were $31.49 per square foot, of which, $84.12 per square foot was for new leases and $2.25 per square foot was for renewals in 2020.
The rental increases associated with comparable spaces generally include all leases signed for retail space in arms-length transactions reflecting market leverage between landlords and tenants during the period. The comparison between the rent for expiring leases and new leases is determined by including contractual rent on the expiring lease, including percentage rent, and the comparable annual rent and in some instances, projections of percentage rent, to be paid on the new lease. In atypical circumstances, management may exercise judgment as to how to most effectively reflect the comparability of rents reported in this calculation. As a result of accommodations made to certain tenants to help them to stay open during and after the COVID-19 pandemic, we have found it necessary to exercise more judgement in 2020 and 2021 than in prior years in order to appropriately reflect the comparability of rents in the calculation. The change in rental income on comparable space leases is impacted by numerous factors including current market rates, location, individual tenant creditworthiness, use of space, market conditions when the expiring lease was signed, capital investment made in the space and the specific lease structure. Rent abatement and short term rent restructuring agreements that are a result of COVID-19 impacts are not included in this calculation. Tenant improvements and incentives include the total dollars committed for the improvement (fit out) of a space as it relates to a specific lease. Incentives include amounts paid to tenants as an inducement to sign a lease that do not represent building improvements. Costs related to tenant improvements require judgement by management in determining what are costs specific to the tenant and not deferred maintenance on the space.

Historically, we have executed comparable space leases for 1.4 to 1.9 million square feet of retail space each year. We expect some rental rates to be negatively impacted by the COVID-19 pandemic, which we started experiencing in the second quarter of 2020. We expect the volume for 2022 will be in line with, or potentially exceed, our historical averages given a larger amount of vacancy as a result of COVID-19. Although we expect overall positive increases in annual rent for comparable spaces, changes in annual rent for any individual lease or combinations of individual leases reported in any particular period may be positive or negative and we can provide no assurance that the annual rents on comparable space leases will continue to increase at historical levels, if at all.
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The leases signed in 2021 generally become effective over the following two years though some may not become effective until 2024 and beyond. Further, there is risk that some new tenants will not ultimately take possession of their space and that tenants for both new and renewal leases may not pay all of their contractual rent due to operating, financing or other matters. However, our historical increases in rental rates do provide information about the tenant/landlord relationship and the potential increase we may achieve in rental income over time.
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Retail and Residential Properties
The following table sets forth information concerning all real estate projects in which we owned an equity interest, had a leasehold interest, or otherwise controlled and are consolidated as of December 31, 2021. Except as otherwise noted, we are the sole owner of our real estate projects. Principal tenants are the largest tenants in the project based on square feet leased or are tenants important to a project’s success due to their ability to attract retail customers.
Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Arizona
Camelback Colonnade
   Phoenix, AZ 85016(5)
1977, 20192021643,00017.5290%Fry's Food & Drug
Floor & Décor
Marshalls
Nordstrom Last Chance
Best Buy
Hilton Village
   Scottsdale, AZ 85250(4)(5)
1982, 1989202193,00036.2593%CVS
Houston's
California
Azalea
   South Gate, CA 90280(5)(8)
20142017223,000$30.3099%Marshalls
Ross Dress for Less
Ulta
Michaels
Bell Gardens
   Bell Gardens, CA 90201(4)(5)(8)
1990, 2003, 20062017/2018330,000$23.2898%Food4Less
Marshalls
Ross Dress for Less
Bob's Discount Furniture
Colorado Blvd
   Pasadena, CA 91103(4)
1905-1988199842,000$59.6988%Banana Republic
True Food Kitchen
Crow Canyon Commons
   San Ramon, CA 94583
1980, 1998,
2006
2005/2007243,000$28.2893%Sprouts
Total Wine & More
Rite Aid
East Bay Bridge
   Emeryville & Oakland, CA 94608
1994-2001,
2011, 2012
2012440,000$19.4399%Pak-N-Save
Home Depot
Target
Nordstrom Rack
Escondido Promenade
   Escondido, CA 92029(5)
19871996/2010298,000$28.7996%TJ Maxx
Dick's Sporting Goods
Ross Dress For Less
Bob's Discount Furniture
Fourth Street
   Berkeley, CA 94710(5)
1948, 1975201771,000$32.6678%CB2
Ingram Book Group
Bellwether Coffee
Freedom Plaza
   Los Angeles, CA 90002(4)(5)
20202018114,000$30.1793%Smart & Final
Nike
Blink Fitness
Ross Dress For Less
Grossmont Center
   La Mesa, CA 91942(5)
1961, 1963, 1982-1983, 20022021933,000$14.1999%Target
Walmart
Macy's
CVS
Hastings Ranch Plaza
   Pasadena, CA 91107(4)
1958, 1984, 2006, 20072017273,000$8.47100%Marshalls
HomeGoods
CVS
Sears
Hollywood Blvd
   Hollywood, CA 90028
1929, 19911999181,000$36.5486%Target
Marshalls
L.A. Fitness
Kings Court
   Los Gatos, CA 95032(4)(6)
1960199881,000$41.56100%Lunardi's
CVS
La Alameda
   Walnut Park, CA 90255(4)(7)(8)
20082017245,000$26.8492%Marshalls
Ross Dress For Less
CVS
Petco
Old Town Center
   Los Gatos, CA 95030
1962, 1998199797,000$43.9590%Anthropologie
Sephora
Teleferic Barcelona
Olivo at Mission Hills
   Mission Hills, CA 91345(5)
20182017155,000$32.21100%Target
24 Hour Fitness
Ross Dress for Less
Plaza Del Sol
   South El Monte, CA 91733(5)
2009201748,000$24.9196%Marshalls
Plaza El Segundo / The Point
   El Segundo, CA 90245(5)(8)
2006-2007, 20162011/2013500,000$45.1592%Whole Foods
Nordstrom Rack
HomeGoods
Dick's Sporting Goods
Multiple Restaurants
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
San Antonio Center
   Mountain View, CA 94040(4)(6)
1958,
1964-1965,
1974-1975,
1995-1997
2015/2019212,000$16.5298%Trader Joe's
Walmart
24 Hour Fitness
Santana Row
   San Jose, CA 95128(4)(10)
2002, 2009, 2016, 202019971,208,000$55.2095%Crate & Barrel H&M Best Buy
Splunk
Net App
Multiple Restaurants
Santana Row Residential
   San Jose, CA 95128
2003-2006,
2011, 2014
1997/2012662 units N/A95%
Sylmar Towne Center
   Sylmar, CA 91342(5)
19732017148,000$17.3993%Food4Less
CVS
Third Street Promenade
   Santa Monica, CA 90401
1888-20001996-2000207,000$83.9281%adidas
Madewell
Patagonia
Multiple Restaurants
Westgate Center
   San Jose, CA 95129
1960-19662004648,000$20.1997%Target
Nordstrom Rack
Nike Factory
TJ Maxx
Connecticut
Bristol Plaza
   Bristol, CT 06010
19591995264,000$14.2183%Stop & Shop
TJ Maxx
Burlington
Greenwich Avenue
   Greenwich Avenue, CT 06830
1968199535,000$96.19100%Saks Fifth Avenue
Darien Commons
   Darien, CT 06820
1920-20092013/201859,000$42.9289%Equinox
Walgreens
2 units N/A100%
District of Columbia
Friendship Center
   Washington, DC 20015
19982001119,000$33.7366%Marshalls
DSW
Maggiano's
Florida
CocoWalk
   Coconut Grove, FL 33133(5)(11)
1990/1994,
1922-1973,
2018-2021
2015-2017245,000$43.9299%Cinepolis Theaters
Youfit Health Club
Multiple Restaurants
Del Mar Village
   Boca Raton, FL 33433
1982, 1994
& 2007
2008/2014187,000$20.9295%Winn Dixie
CVS
L.A. Fitness
Tower Shops
   Davie, FL 33324
1989, 20172011/2014430,000$26.0397%Trader Joe's
TJ Maxx
Ross Dress for Less
Best Buy
Ulta
Illinois
Crossroads
   Highland Park, IL 60035
19591993168,000$23.5492%L.A. Fitness
Ulta
Binny's
Ferguson's Bath, Kitchen, & Lighting Gallery
Finley Square
   Downers Grove, IL 60515
19741995281,000$16.4590%Bed, Bath & Beyond
Buy Buy Baby
Michaels Portillo's
Garden Market
   Western Springs, IL 60558
19581994139,000$14.76100%Mariano's Fresh Market
Walgreens
Riverpoint Center
   Chicago, IL 60614
1989, 20122017211,000$21.2393%Jewel Osco
Marshalls
Old Navy
Maryland
Bethesda Row
   Bethesda, MD 20814(4)
1945-1991
2001, 2008
1993-2006/
2008/2010
529,000$55.5195%Giant Food
Apple
Equinox
Anthropologie
Multiple Restaurants
Bethesda Row Residential
   Bethesda, MD 20814
20081993180 units N/A96%
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Congressional Plaza
   Rockville, MD 20852(5)
19651965324,000$42.2291%The Fresh Market
Buy Buy Baby
Ulta
Barnes & Noble
Container Store
Congressional Plaza Residential
   Rockville, MD 20852(5)
2003, 20161965194 units N/A98%
Courthouse Center
   Rockville, MD 20852
1975199738,000$22.8176%
Federal Plaza
   Rockville, MD 20852
19701989249,000$37.1193%Trader Joe's
TJ Maxx
Micro Center
Ross Dress for Less
Gaithersburg Square
   Gaithersburg, MD 20878
19661993208,000$31.4196%Marshalls Ross Dress For Less
Ashley Furniture HomeStore
CVS
Governor Plaza
   Glen Burnie, MD 21961
19631985243,000$20.9288%Aldi
Dick's Sporting Goods
Laurel
   Laurel, MD 20707
19561986364,000$22.9894%Giant Food
Marshalls
L.A. Fitness
HomeGoods
Montrose Crossing
   Rockville, MD 20852
1960-1979,
1996, 2011
2011/2013368,000$34.34100%Giant Food
Marshalls
Home Depot Design Center
Old Navy
Bob's Discount Furniture
Perring Plaza
   Baltimore, MD 21134
19631985397,000$15.7688%Shoppers Food Warehouse
Home Depot
Micro Center
Burlington
Pike & Rose
   North Bethesda, MD 20852(10)
1963, 2014, 2018, 20201982/2007/
2012
622,000$40.1799%Porsche
Uniqlo
REI
H&M
L.L. Bean Multiple Restaurants
Pike & Rose Residential
   North Bethesda, MD 20852
2014, 2016, 20181982/2007765 units N/A97%
Plaza Del Mercado
   Silver Spring, MD 20906
19692004116,000$32.1695%Aldi
CVS
L.A. Fitness
Quince Orchard
   Gaithersburg, MD 20877(4)
19751993268,000$25.4892%Aldi
HomeGoods
L.A. Fitness
Staples
Rockville Town Square
   Rockville, MD 20852(4)
2006-20072006/2007187,000$28.8779%Dawson's Market
CVS
Gold's Gym
Multiple Restaurants
Rollingwood Apartments
   Silver Spring, MD 20910
19601971282 units N/A99%
THE AVENUE at White Marsh
   Baltimore, MD 21236(6)
19972007315,000$27.1388%AMC
Ulta
Old Navy
Barnes & Noble
The Shoppes at Nottingham Square
   Baltimore, MD 21236
2005-2006200732,000$49.7396%
Towson Residential (Flats @703)
   Baltimore, MD 21236
201720074,000$82.83100%
105 units N/A100%
White Marsh Other
   Baltimore, MD 21236
1985200756,000$32.79100%
White Marsh Plaza
   Baltimore, MD 21236
1987200780,000$23.61100%Giant Food
Wildwood
   Bethesda, MD 20814
1958196988,000$102.8796%Balducci's
CVS
Multiple Restaurants
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Massachusetts
Assembly Row/
Assembly Square Marketplace
   Somerville, MA 02145(10)
2005, 2014, 2018, 20212005-2011/
2013
1,069,000$35.1197%Trader Joe's
TJ Maxx
AMC
LEGOLAND Discovery Center
PUMA
Multiple Restaurants
Assembly Row Residential
   Somerville, MA 02145(10)(13)
20182005-2011947 units N/A76%
Campus Plaza
   Bridgewater, MA 02324
19702004114,000$17.3596%Roche Bros.
Burlington
Chelsea Commons
   Chelsea, MA 02150(8)
1962,1969,
2008
2006-2008222,000$12.8193%Home Depot
Planet Fitness
Dedham Plaza
   Dedham, MA 02026
19591993/2016/
2019
245,000$16.7588%Star Market
Planet Fitness
Linden Square
   Wellesley, MA 02481
1960, 20082006220,000$49.7594%Roche Bros.
CVS
7 units N/A100%
North Dartmouth
   North Dartmouth, MA 02747
2004200648,000$17.22100%Stop & Shop
Queen Anne Plaza
   Norwell, MA 02061
19671994149,000$20.3999%Big Y Foods
TJ Maxx
HomeGoods
Michigan
Gratiot Plaza
   Roseville, MI 48066
19641973215,000$12.81100%Kroger
Bed, Bath & Beyond
Best Buy
DSW
New Jersey
Brick Plaza
   Brick Township, NJ 08723(4)
19581989408,000$21.9693%Trader Joe's
AMC
HomeGoods
Ulta Burlington
Brook 35
   Sea Grit, NJ 08750(5)(6)(8)
1986, 2004201499,000$40.2492%Banana Republic
Gap
Williams-Sonoma
Ellisburg
   Cherry Hill, NJ 08034
19591992260,000$18.3897%Whole Foods
Buy Buy Baby
Hoboken
   Hoboken, NJ 07030(5)(8)(12)
1887-20062019/2020171,000$55.8798%CVS
New York Sports Club
Sephora
Multiple Restaurants
129 units N/A99%
Mercer Mall
   Lawrenceville, NJ 08648(4)
19752003/2017551,000$26.5489%Shop Rite
Ferguson Bath, Kitchen, & Lighting
Ross Dress for Less
Nordstrom Rack
REI
Tesla
The Grove at Shrewsbury
   Shrewsbury, NJ 07702(5)(6)(8)
1988, 1993
& 2007
2014192,000$48.6899%Lululemon
Anthropologie
Pottery Barn
Williams-Sonoma
Troy Hills
   Parsippany-Troy, NJ 07054
19661980211,000$23.14100%Target
L.A. Fitness Michaels
New York
Fresh Meadows
   Queens, NY 11365
19491997409,000$37.2995%Island of Gold
AMC
Kohl's
Michaels
Georgetowne Shopping Center
   Brooklyn, NY 11234
1969, 2006, 20152019147,000$39.5088%Foodway
Five Below
IHOP
Greenlawn Plaza
   Greenlawn, NY 11743
1975, 20042006103,000$18.3989%Greenlawn Farms
Tuesday Morning
Planet Fitness
Hauppauge
   Hauppauge, NY 11788
19631998133,000$34.9971%Shop Rite
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Huntington
   Huntington, NY 11746
19621988/2007/ 2015212,000$17.1284%Petsmart
Michaels
Ulta
Huntington Square
   East Northport, NY 11731(4)
1980, 2007201074,000$30.0581%Barnes & Noble
Melville Mall
   Huntington, NY 11747(4)
19742006253,000$28.70100%Uncle Giuseppe's Marketplace
Marshalls
Dick's Sporting Goods
Field & Stream
Macy's Backstage
Pennsylvania
Andorra
   Philadelphia, PA 19128
19531988270,000$15.0187%Acme Markets
TJ Maxx Kohl's
L.A. Fitness
Five Below
Bala Cynwyd
   Bala Cynwyd, PA 19004
19551993174,000$36.7995%Acme Markets
Michaels
L.A. Fitness
Bala Cynwyd Residential
   Bala Cynwyd, PA 19004
2020199387 units N/A97%
Flourtown
   Flourtown, PA 19031
19571980156,000$23.4598%Giant Food
Movie Tavern
Lancaster
   Lancaster, PA 17601(4)
19581980126,000$20.0896%Giant Food
Langhorne Square
   Levittown, PA 19056
19661985223,000$18.4599%Redner's Warehouse Markets
Marshalls
Planet Fitness
Lawrence Park
   Broomall, PA 19008
19721980/2017358,000$22.8896%Acme Markets
TJ Maxx
HomeGoods
Barnes & Noble
Lankenau Medical Center
Northeast
   Philadelphia, PA 19114
19591983227,000$19.7682%Marshalls
Ulta
Skechers
Crunch Fitness
Town Center of New Britain
   New Britain, PA 18901
19692006124,000$10.0489%Giant Food
Rite Aid
Dollar Tree
Willow Grove
   Willow Grove, PA 19090
19531984183,000$22.0658%Marshalls
Five Below
Wynnewood
   Wynnewood, PA 19096
19481996249,000$29.1296%Giant Food
Bed, Bath & Beyond
Old Navy
DSW
9 units N/A78%
Virginia
29th Place
   Charlottesville, VA 22091(8)
1975-20012007168,000$19.3899%Lidl HomeGoods
DSW
Staples
Barcoft Plaza
   Falls Church, VA 22041
1963, 1972, 1990, & 20002006/2007/ 2016113,000$27.9394%Harris Teeter
Barracks Road
   Charlottesville, VA 22905
19581985498,000$27.6197%Harris Teeter
Kroger
Anthropologie
Nike
Bed, Bath & Beyond
Old Navy
Birch & Broad (formerly known as Falls Plaza)
   Falls Church, VA 22046
1960/19621967/1972144,000$36.0796%Giant Food
CVS
Staples
Chesterbrook
   McLean, VA 22101(5)
1967202190,000$26.7985%Safeway
Walgreens
Starbucks
Fairfax Junction
   Fairfax, VA 22030(6)
1981, 1986, 20002019/2020124,000$25.5097%Aldi
CVS
Planet Fitness
Graham Park Plaza
   Falls Church, VA 22042
19711983132,000$39.7187%Giant Food
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Idylwood Plaza
   Falls Church, VA 22030
1991199473,000$52.50100%Whole Foods
Mount Vernon/South Valley/
   7770 Richmond Hwy
   Alexandria, VA 22306(6)
1966,
1972,1987
& 2001
2003/2006565,000$19.3797%Shoppers Food Warehouse
TJ Maxx
Home Depot
Bed, Bath & Beyond
Results Fitness
Old Keene Mill
   Springfield, VA 22152
1968197691,000$35.0595%Whole Foods
Walgreens
Planet Fitness
Pan Am
   Fairfax, VA 22031
19791993228,000$26.1894%Safeway
Micro Center
CVS
Michaels
Pentagon Row
   Arlington, VA 22202
2001-20021998/2010297,000$35.6399%Harris Teeter
TJ Maxx
DSW
Ulta
Pike 7 Plaza
   Vienna, VA 22180
19681997/2015172,000$48.3797%TJ Maxx
DSW
Crunch Fitness Staples
Tower Shopping Center
   Springfield, VA 22150
19601998111,000$27.2087%L.A. Mart
Talbots
Total Wine & More
Twinbrooke Shopping Centre
   Fairfax, VA 22032
19772021106,000$24.2689%Safeway
Walgreens
Tyson's Station
   Falls Church, VA 22043
1954197850,000$47.7088%Trader Joe's
Village at Shirlington
   Arlington, VA 22206(4)
1940,
2006-2009
1995267,000$40.6283%Harris Teeter
CVS AMC
Carlyle Grand Café
Willow Lawn
   Richmond, VA 23230
19571983464,000$21.1196%Kroger
Old Navy
Ross Dress For Less
Gold's Gym
Dick's Sporting Goods
Total — Commercial (9)25,102,000$29.6994%
Total —Residential (13)2,869 units97%
 _____________________
(1)Represents the GLA of the commercial portion of the property. Some of our properties include office space which is included in this square footage.
(2)Average base rent per square foot is calculated as the aggregate, annualized in-place contractual (defined as cash basis excluding rent abatements) minimum rent for all occupied spaces divided by the aggregate GLA of all occupied spaces. Average base rent is for commercial spaces only.
(3)Percentage leased is expressed as a percentage of rentable commercial square feet occupied or subject to a lease. Residential percentage leased is expressed as a percentage of units occupied or subject to a lease.
(4)All or a portion of this property is owned pursuant to a ground lease.
(5)We own the controlling interest in this property.
(6)We own all or a portion of this property in a “downREIT” partnership, of which a wholly owned subsidiary of the Trust is the sole general partner, with third party partners holding operating partnership units.
(7)We own a noncontrolling interest in this property.
(8)All or a portion of this property is encumbered by a mortgage loan.
(9)Aggregate information is calculated on a GLA weighted-average basis, excluding our La Alameda property, which is unconsolidated.
(10)Portion of property is currently under development. See further discussion in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.
(11)This property includes interests in four buildings in addition to our initial acquisition.
(12)This property includes 39 buildings primarily along Washington Street and 14th Street in Hoboken, New Jersey.
(13)The new 500 unit residential building at Assembly Row was delivered in the second half of 2021 and is currently in the process of being leased-up for the first time. Consequently, these units are excluded from our total residential units and percentage leased statistics. If these units were included, our total residential units would be 3,369 and our percentage leased would be 91%.

ITEM 3.    LEGAL PROCEEDINGS
We are involved from time-to-time in various legal and regulatory proceedings that arise in the ordinary course of our business, including, but not limited to, commercial disputes, environmental matters, and litigation in connection with transactions such as acquisitions and divestitures. We believe that our current proceedings will not have a material adverse effect on our financial condition, liquidity or results of operations. See Note 7 to the Consolidated Financial Statements for further discussions.
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ITEM 4.    MINE SAFETY DISCLOSURES
Not applicable.
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PART II
ITEM 5.    MARKET FOR OUR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Our common shares trade on the New York Stock Exchange under the symbol “FRT.” Listed below are the high and low sales prices of our common shares as reported on the New York Stock Exchange and the dividends declared for each of the periods indicated.
 
 Price Per ShareDividends
Declared
Per Share
HighLow
2021
Fourth quarter$138.40 $117.48 $1.070 
Third quarter$123.43 $111.21 $1.070 
Second quarter$125.00 $101.45 $1.060 
First quarter$110.66 $81.85 $1.060 
2020
Fourth quarter$97.00 $67.01 $1.060 
Third quarter$90.09 $70.69 $1.060 
Second quarter$105.49 $64.11 $1.050 
First quarter$131.56 $65.55 $1.050 
On February 7, 2022, there were 2,271 holders of record of our common shares.
Our ongoing operations generally will not be subject to federal income taxes as long as we maintain our REIT status and distribute to shareholders at least 100% of our taxable income. Under the Code, REITs are subject to numerous organizational and operational requirements, including the requirement to generally distribute at least 90% of taxable income.
Future distributions will be at the discretion of our Board of Trustees and will depend on our actual net income available for common shareholders, financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code and such other factors as the Board of Trustees deems relevant. We have paid quarterly dividends to our shareholders continuously since our founding in 1962 and have increased our regular annual dividend rate for 54 consecutive years. The impact of COVID-19 on our cash flow may impact our ability to pay dividends at the current rate, at an increased rate, and in the current format or at all.
Our total annual dividends paid per common share for 2021 and 2020 were $4.25 per share and $4.21 per share, respectively. The annual dividend amounts are different from dividends as calculated for federal income tax purposes. Distributions to the extent of our current and accumulated earnings and profits for federal income tax purposes generally will be taxable to a shareholder as ordinary dividend income. Distributions in excess of current and accumulated earnings and profits will be treated as a nontaxable reduction of the shareholder’s basis in such shareholder’s shares, to the extent thereof, and thereafter as taxable capital gain. Distributions that are treated as a reduction of the shareholder’s basis in its shares will have the effect of increasing the amount of gain, or reducing the amount of loss, recognized upon the sale of the shareholder’s shares. No assurances can be given regarding what portion, if any, of distributions in 2022 or subsequent years will constitute a return of capital for federal income tax purposes. During a year in which a REIT earns a net long-term capital gain, the REIT can elect under Section 857(b)(3) of the Code to designate a portion of dividends paid to shareholders as capital gain dividends. If this election is made, then the capital gain dividends are generally taxable to the shareholder as long-term capital gains.
The following table reflects the income tax status of distributions per share paid to common shareholders:
 
 Year Ended
December 31,
20212020
Ordinary dividend$3.358 $3.452 
Capital gain0.680 — 
Return of capital0.212 0.758 
$4.250 $4.210 
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Distributions on our 5.417% Series 1 Cumulative Convertible Preferred Shares were paid at the rate of $1.354 per share per annum commencing on the issuance date of March 8, 2007. Distributions on our 5.0% Series C Cumulative Redeemable Preferred Shares were paid at the rate of $1.250 per depositary share per annum, commencing on the issuance date of September 29, 2017. We do not believe that the preferential rights available to the holders of interest in our preferred shares or the financial covenants contained in our debt agreements had or will have an adverse effect on our ability to pay dividends in the normal course of business to our common shareholders or to distribute amounts necessary to maintain our qualification as a REIT.
Total Stockholder Return Performance
The following performance graph compares the cumulative total shareholder return on Federal Realty's common shares with the S&P 500 Index and the index of equity real estate investment trusts prepared by the National Association of Real Estate Investment Trusts ("NAREIT") for the five fiscal years commencing December 31, 2016, and ending December 31, 2021, assuming an investment of $100 and the reinvestment of all dividends into additional common shares during the holding period. Equity real estate investment trusts are defined as those that derive more than 75% of their income from equity investments in real estate assets. The FTSE NAREIT Equity REIT Total Return Index includes all tax qualified real estate investment trusts listed on the NYSE, NYSE MKT, or the NASDAQ National Market. Stock performance for the past five years is not necessarily indicative of future results.
frt-20211231_g1.jpg
Recent Sales of Unregistered Shares
Under the terms of various operating partnership agreements of certain of our affiliated limited partnerships, the interest of limited partners in those limited partnerships may be redeemed, subject to certain conditions, for cash or an equivalent number of our common shares, at our option. During the three months ended December 31, 2021, we issued 27,302 common shares in connection with the redemption of operating partnership units. Any equity securities sold by us during 2021 that were not registered have been previously reported in a Quarterly Report on Form 10-Q.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
During 2021, 2,193 restricted common shares were forfeited by former employees.
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From time to time, we could be deemed to have repurchased shares as a result of shares withheld for tax purposes upon a stock compensation related vesting event.
ITEM 6.    SELECTED FINANCIAL DATA
None.
ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This section generally discusses 2021 and 2020 items and year-to-year comparisons between 2021 and 2020. Discussions of 2019 items and year-to-year comparisons between 2020 and 2019 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed with the Securities and Exchange Commission on February 11, 2021.

Forward-Looking Statements
Certain statements in this section or elsewhere in this report may be deemed “forward-looking statements”. See “Item 1A. Risk Factors” in this report for important information regarding these forward-looking statements and certain risk and uncertainties that may affect us. The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing in “Item 8. Financial Statements and Supplementary Data” of this report.
Overview
We are an equity real estate investment trust ("REIT") specializing in the ownership, management, and redevelopment of high quality retail and mixed-use properties located primarily in densely populated and affluent communities in strategically selected metropolitan markets in the Northeast and Mid-Atlantic regions of the United States, California, and South Florida. As of December 31, 2021, we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 104 predominantly retail real estate projects comprising approximately 25.1 million square feet. In total, the real estate projects were 93.6% leased and 91.1% occupied at December 31, 2021. We have paid quarterly dividends to our shareholders continuously since our founding in 1962 and have increased our dividends per common share for 54 consecutive years.
Summary Financial Information
The following table includes select financial information that is helpful in understanding the trends in financial condition and the results of operations discussed throughout this Item 7. and “Item 8. Financial Statements and Supplementary Data.”
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 Year Ended December 31,
202120202019
(In thousands, except per share data and ratios)
Operating Data:
Rental income$948,842 $832,171 $932,738 
Property operating income (1)$634,607 $545,332 $637,030 
Gain on sale of real estate and change in control of interest, net of tax$89,950 $98,117 $116,393 
Operating income$394,725 $289,524 $470,911 
Net income available for common shareholders$253,456 $123,664 $345,824 
Net cash provided by operating activities$471,352 $369,929 $461,919 
Net cash used in investing activities$(660,118)$(368,383)$(316,532)
Net cash (used in) provided by financing activities$(452,967)$661,736 $(100,105)
Earnings per common share, diluted:
Net income available to common shareholders$3.26 $1.62 $4.61 
Dividends declared per common share$4.26 $4.22 $4.14 
Other Data:
Funds from operations available to common shareholders (2)$434,743 $333,849 $465,819 
Funds from operations available for common shareholders, per diluted share (2)$5.57 $4.38 $6.17 
EBITDAre (3)$589,792 $501,813 $599,567 
Ratio of EBITDAre to combined fixed charges and preferred share dividends (3)(4)3.6x2.7x4.2x
 As of December 31,
202120202019
(In thousands)
Balance Sheet Data:
Real estate, at cost$9,422,062 $8,582,870 $8,298,132 
Total assets$7,622,320 $7,607,624 $6,794,992 
Total debt$4,047,547 $4,291,375 $3,356,594 
Total shareholders’ equity$2,663,148 $2,548,747 $2,636,132 
Number of common shares outstanding78,603 76,727 75,541 
(1)Property operating income is a non-GAAP measure that consists of rental income and mortgage interest income, less rental expenses and real estate taxes. This measure is used internally to evaluate the performance of property operations and we consider it to be a significant measure. Property operating income should not be considered an alternative measure of operating results or cash flow from operations as determined in accordance with GAAP. The reconciliation of operating income to property operating income for 2021, 2020, and 2019 is as follows:
202120202019
(in thousands)
Operating income$394,725 $289,524 $470,911 
General and administrative49,856 41,680 42,754 
Depreciation and amortization279,976 255,027 239,758 
Impairment charge— 57,218 — 
Gain on sale of real estate and change in control of interest, net of tax(89,950)(98,117)(116,393)
Property operating income$634,607 $545,332 $637,030 
(2)Funds from operations "FFO" is a supplemental non-GAAP measure. See "Liquidity and Capital Resources" in this Item 7. for further discussion.
(3)EBITDA for Real Estate ("EBITDAre") is a non-GAAP measure that NAREIT defines as: net income computed in accordance with GAAP plus net interest expense, income tax expense, depreciation and amortization, gain or loss on sale of real estate, impairments of real estate, and adjustments to reflect the entity's share of EBITDAre of unconsolidated
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affiliates. We calculate EBITDAre consistent with the NAREIT definition. As EBITDA is a widely known and understood measure of performance, management believes EBITDAre represents an additional non-GAAP performance measure, independent of a company's capital structure that will provide investors with a uniform basis to measure the enterprise value of a company. EBITDAre also approximates a key performance measure in our debt covenants, but it should not be considered an alternative measure of operating results or cash flow from operations as determined in accordance with GAAP.
The reconciliation of net income to EBITDAre for the periods presented is as follows:
202120202019
(In thousands)
Net income$269,081 $135,888 $360,542 
Interest expense127,698 136,289 109,623 
Other interest income(809)(1,894)(1,266)
Early extinguishment of debt— 11,179 — 
Provision (benefit) for income tax118 (194)772 
Depreciation and amortization279,976 255,027 239,758 
Gain on sale of real estate and change in control of interest(89,950)(98,117)(116,779)
Impairment charge— 57,218 — 
Adjustments of EBITDAre of unconsolidated affiliates3,678 6,417 6,917 
EBITDAre$589,792 $501,813 $599,567 
(4)Fixed charges consist of interest on borrowed funds (including capitalized interest), amortization of debt discount/ premiums and debt costs, costs related to the early extinguishment of debt, and the portion of rent expense representing an interest factor. Excluding the $11.2 million early extinguishment of debt charge from fixed charges in 2020, the ratio of EBITDAre to combined fixed charges and preferred share dividends is 2.9x. Excluding the $11.9 million charge related to the buyout of the Kmart lease at Assembly Square Marketplace in 2019, our ratio of EBITDAre to combined fixed charges and preferred share dividends remained 4.2x.
Impacts of COVID-19 Pandemic
We continue to monitor and address risks related to the COVID-19 pandemic. Since March 2020 when the World Health Organization characterized COVID-19 as a global pandemic, we have been and continue to be impacted by COVID-19 and the actions taken by federal, state, and local government to prevent its spread. These actions included the closure of nonessential businesses and ordering residents to generally stay at home at the onset of the pandemic, phased reopenings and capacity limitations, and now generally lifted restrictions. While the overall economy is showing signs of recovery from the initial impacts of COVID-19, workforce shortages, global supply chain bottlenecks and shortages, inflation, as well as COVID-19 variants are impacting the pace of recovery. Closures and restrictions, along with general concern over the spread of COVID-19, required a significant number of tenants to close their operations or to significantly limit the amount of business they are able to conduct, which impacted their ability to timely pay rent as required under our leases and also caused many tenants to close their business permanently. While improving, our cash flow and results of operations in the year ended December 31, 2021 continued to be materially adversely impacted, with vacancy levels remaining above historical levels. Although virtually all of our leases required the tenants to pay rent even while they were not operating, we entered into numerous agreements to abate, defer, and/or restructure tenant rent payments for varying periods of time, all with the objective of collecting as much cash as reasonably possible and maintaining occupancy to the maximum extent. We believe those actions will position many of our tenants to be able to return to payment of contractual rent as soon as possible after the impacts from the pandemic have subsided.
We believe that the actions we have taken to improve our financial position and maximize our liquidity, as described further in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2020 Annual Report on Form 10-K, will continue to mitigate the impact to our cash flow caused by tenants not timely paying contractual rent. Throughout 2021, we continued to maintain levels of cash significantly in excess of the cash balances we have historically maintained which has adversely impacted our financial results; however, we believe that such action was prudent to position us with what we expect to be sufficient liquidity to allow us to continue fully operating as our operating revenues begin to return to more typical levels. As of December 31, 2021, there is no outstanding balance on our $1.0 billion revolving credit facility, and we have cash and cash equivalents of $162.1 million.

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Additional discussion of the impact of COVID-19 on our results and long-term operations can be found throughout Item 7 and Item 1A. Risk Factors.
Corporate Responsibility
We actively endeavor to operate and develop our properties in a sustainable, responsible, and effective manner with the objective being to drive long-term growth and aid in value creation for our shareholders, tenants, employees, and local communities. We have aligned our program and efforts with the United Nations Sustainable Development Goals, as described in our ESG Policy and our 2020 Corporate Responsibility Report, which are provided only for informational purposes on our website and not incorporated herein.

Our development activities have been heavily focused on owning, developing and operating properties that are certified under the U.S. Green Building Council’s® (“USGBC”) Leadership in Energy and Environmental Design™ (LEED®) rating system which serves as a third-party verification that a building or community was designed and built to mitigate its environmental footprint. We currently have 18 LEED certified buildings and our Pike & Rose project has achieved LEED for Neighborhood Development Stage 3 Gold certification. The COVID-19 pandemic has also increased our focus on owning, developing and operating healthier buildings. To that end, our new corporate headquarters space at our 909 Rose Avenue building has earned a Fitwel certification developed by the U.S. Centers for Disease Control and Prevention (CDC) together with the General Services Administration (GSA). This certification assesses a building’s impact on seven distinct categories related to overall health and well-being.
We are also committed to implementing sustainable business practices at our operating properties that focus on energy efficiency, water conservation and waste minimization and have established energy and greenhouse gas (GHG) emissions reduction targets. To achieve these targets, we are actively addressing energy efficiency projects on site such as upgrading to LED lighting; and to address emissions we are procuring green energy, reducing electric consumption, and increasing our onsite solar generation capacity. We have installed on-site solar systems at 25 of our properties with a capacity of over 13 MW with more projects actively in progress. Our current capacity placed us in the top 5 among real estate companies for onsite capacity in the most recent Solar Energy Industry Association’s annual Solar Means Business Report. We are also actively installing electric vehicle car charging stations in numerous properties throughout our portfolio. We currently have over 300 charging stations in operation with more under construction.
We also understand that we face risks presented by climate change and are working to evaluate our risk exposure. In our 2020 Corporate Responsibility Report, we provided a disclosure pursuant to the Task Force on Climate Related Financial Disclosure and we intend to provide that disclosure annually.
We are also highly committed to our employees and fostering a work environment that promotes growth, development and personal well-being. Our four core values are accountability, excellence, innovation and integrity and we seek to attract and retain talented professionals who embrace those values. All of our efforts with respect to corporate responsibility are overseen by our Board of Trustees.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, referred to as “GAAP”, requires management to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using management’s best judgment, after considering past and current events and economic conditions. In addition, information relied upon by management in preparing such estimates includes internally generated financial and operating information, external market information, when available, and when necessary, information obtained from consultations with third party experts. Actual results could differ from these estimates. A discussion of possible risks which may affect these estimates is included in “Item 1A. Risk Factors” of this report. Management considers an accounting estimate to be critical if changes in the estimate could have a material impact on our consolidated results of operations or financial condition.
Our significant accounting policies are more fully described in Note 2 to the consolidated financial statements; however, the most critical accounting policies, which are most important to the portrayal of our financial condition and results of operations, and involve the use of complex estimates and significant assumptions as to future uncertainties and, therefore, may result in actual amounts that differ from estimates, are as follows:
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Collectibility of Lease Income
Our leases with our tenants are classified as operating leases. When collection of substantially all lease payments during the lease term is considered probable, the lease qualifies for accrual accounting. When collection of substantially all lease payments during the lease term is not considered probable, total lease revenue is limited to the lesser of revenue recognized under accrual accounting or cash received. Determining the probability of collection of substantially all lease payments during a lease term requires significant judgment. This determination is impacted by numerous factors including our assessment of the tenant’s credit worthiness, economic conditions, tenant sales productivity in that location, historical experience with the tenant and tenants operating in the same industry, future prospects for the tenant and the industry in which it operates, and the length of the lease term. If leases currently classified as probable are subsequently reclassified as not probable, any outstanding lease receivables (including straight-line rent receivables) would be written-off with a corresponding decrease in rental income. For example, in the event that our collectibility determinations were not accurate and we were required to write off additional receivables equaling 1% of rental income, our rental income and net income would decrease by $9.5 million. If leases currently classified as not probable are subsequently changed to probable, any lease receivables (including straight-line rent receivables) are re-instated with a corresponding increase to rental income.
Since March 2020, federal, state, and local governments have taken various actions to mitigate the spread of COVID-19. These actions included the closure of nonessential businesses and ordering residents to generally stay at home at the onset of the pandemic, phased re-openings and capacity limitations, and now generally lifted restrictions. While the overall economy is showing signs of recovery from the initial impacts of COVID-19, workforce shortages, global supply chain bottlenecks and shortages, inflation, as well as COVID-19 variants are impacting the recovery. Closures and restrictions, along with the general concern over the spread of COVID-19, required a significant number of tenants to close their operations or to significantly limit the amount of business they were able to conduct, which impacted their ability to timely pay rent as required under our leases and also caused many tenants to close their business permanently. As a result, we revised our collectibility assumptions for many of our tenants most significantly impacted by COVID-19. Accordingly, during the years ended December 31, 2021 and 2020, we recognized collectibility related adjustments of $24.0 million and $106.6 million, respectively. This includes changes in our collectibility assessments from probable to not probable, disputed rents, and any rent abatements directly related to COVID-19, as well as the write-off of $0.7 million and $12.7 million, respectively of straight-line rent receivables related to tenants changed to a cash basis of revenue recognition during the years ended December 31, 2021 and 2020. As of December 31, 2021 and 2020, the revenue from approximately 34% and 35% of our tenants (based on total commercial leases), respectively, is being recognized on a cash basis. As of December 31, 2021 and 2020, our straight-line rent receivables balance was $110.7 million and $103.3 million, respectively, and is included in "accounts and notes receivable, net" on our consolidated balance sheet.
Other revenue recognition policies
When we enter into a transaction to sell a property or a portion of a property, we evaluate the recognition of the sale under ASC 610-20, "Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets." In accordance with ASC 610-20, we apply the guidance in ASC 606, "Revenue from Contracts with Customers," to determine whether and when control transfers and how to measure the associated gain or loss. We determine the transaction price based on the consideration we expect to receive. Variable consideration is included in the transaction price to the extent it is probable that a significant reversal of a gain recognized will not occur. We analyze the risk of a significant gain reversal and if necessary limit the amount of variable consideration recognized in order to mitigate this risk. The estimation of variable consideration requires us to make assumptions and apply significant judgment. The existence and amount of variable consideration can vary significantly among transactions. Historically, our property sales have had variable consideration of less than 1% of total expected consideration; however, we had one transaction in 2019 where the variable consideration was approximately $45.5 million.
Real Estate Acquisitions
Upon acquisition of operating real estate properties, we estimate the fair value of assets and liabilities acquired including land, building, improvements, leasing costs, intangibles such as acquired leases, assumed debt, and current assets and liabilities, if any.  Based on these estimates, we allocate the purchase price to the applicable assets and liabilities. We utilize methods similar to those used by independent appraisers in estimating the fair value of acquired assets and liabilities. The value allocated to acquired leases is amortized over the related lease term and reflected as rental income in the statement of operations. We consider qualitative and quantitative factors in evaluating the likelihood of a tenant exercising a below market renewal option and include such renewal options in the calculation of in-place lease value when we consider these to be bargain renewal options. If the value of below market lease intangibles includes renewal option periods, we include such renewal periods in the amortization period utilized. If a tenant vacates its space prior to contractual termination of its lease, the unamortized balance of any acquired lease value is written off to rental income.
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During 2021, we acquired properties with a total purchase price of $440.9 million. $4.6 million, or 1% of the total purchase price was allocated to above market lease assets and $57.3 million, or 13% was allocated to below market lease liabilities. If the amounts allocated in 2021 to below market lease liabilities and building assets were each reduced by 5% of the total purchase price, annual below market lease liability amortization increasing rental income would decrease by approximately $2.5 million (using the weighted average life of below market liabilities at each respective acquired property) and annual depreciation expense would decrease by approximately $0.6 million (using a depreciable life of 35 years).
Long-Lived Assets and Impairment
There are estimates and assumptions made by management in preparing the consolidated financial statements for which the actual results will be determined over long periods of time. This includes the recoverability of long-lived assets, including our properties that have been acquired or redeveloped and our investment in certain joint ventures. Management’s evaluation of impairment includes review for possible indicators of impairment as well as, in certain circumstances, undiscounted and discounted cash flow analysis. Since most of our investments in real estate are wholly-owned or controlled assets which are held for use, a property with impairment indicators is first tested for impairment by comparing the undiscounted cash flows, taking into account the anticipated hold period, including residual value, to the current net book value of the property. If the undiscounted cash flows are less than the net book value, the property is written down to expected fair value.
The calculation of both discounted and undiscounted cash flows requires management to make estimates of future cash flows including revenues, operating expenses, required maintenance and development expenditures, market conditions, demand for space by tenants and rental rates over long periods. Because our properties typically have a long life, the assumptions used to estimate the future recoverability of book value requires significant management judgment. We are also required to estimate the anticipated hold period. A change in the expected holding period from a long term hold to a short term would cause a significant change in the undiscounted cash flows and could result in an impairment charge. Actual results could be significantly different from the estimates. These estimates have a direct impact on net income, because recording an impairment charge results in a negative adjustment to net income.
Recently Adopted and Recently Issued Accounting Pronouncements
See Note 2 to the consolidated financial statements.
2021 Acquisitions and Dispositions
On January 4, 2021, we acquired our partner's 20% interest in our joint venture arrangement related to the Pike & Rose hotel for $2.3 million, and repaid the $31.5 million mortgage loan encumbering the hotel. As a result of the transaction, we gained control of the hotel, and effective January 4, 2021, we have consolidated this asset. We also recognized a gain on acquisition of the controlling interest of $2.1 million related to the difference between the carrying value and fair value of the previously held equity interest.
On February 22, 2021, we acquired the fee interest at our Mount Vernon Plaza property in Alexandria, Virginia for $5.6 million. As a result of this transaction, the "operating lease right of use assets" and "operating lease liabilities" on our consolidated balance sheet decreased by $9.8 million. We now own the entire fee interest on this property.
During the year ended December 31, 2021, we acquired the following properties:
Date AcquiredPropertyCity/StateGross Leasable Area (GLA)Ownership %Gross Value
(in square feet)(in millions)
April 30, 2021Chesterbrook (1)McLean, Virginia90,00080 %$32.1 (2)
June 1, 2021Grossmont Center (1)La Mesa, California933,00060 %$175.0 (3)
June 14, 2021Camelback Colonnade (1)Phoenix, Arizona642,00098 %$162.5 (4)
June 14, 2021Hilton Village (1)Scottsdale, Arizona93,00098 %$37.5 (5)
September 2, 2021Twinbrooke Shopping CentreFairfax, Virginia106,000100 %$33.8 (6)
(1)These acquisitions were completed through newly formed joint ventures, for which we own the controlling interest listed above, and therefore, these properties are consolidated in our financial statements.
(2)Approximately $1.9 million and $0.6 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $8.0 million of net assets acquired were allocated to other liabilities for "below market leases."
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(3)Approximately $12.3 million and $2.6 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $14.7 million of net assets acquired were allocated to other liabilities for "below market leases."
(4)Approximately $11.6 million of net assets acquired were allocated to other assets for "acquired lease costs" and $28.3 million were allocated to other liabilities for "below market leases."
(5)The land is controlled under a long-term ground lease that expires on December 31, 2076, for which we have recorded a $10.4 million "operating lease right of use asset" (net of a $1.3 million above market liability) and an $11.6 million "operating lease liability." Approximately $2.7 million and $1.1 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $3.6 million were allocated to other liabilities for "below market leases."
(6)Approximately $1.2 million and $0.3 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $2.7 million of net assets acquired were allocated to other liabilities for "below market leases."
During the year ended December 31, 2021, we sold two properties and a portion of three properties for a total sales price of $141.6 million, which resulted in a net gain of $88.3 million.
2021 Significant Debt and Equity Transactions
On February 24, 2021, we replaced our existing at-the-market (“ATM”) equity program with a new ATM equity program in which we may from time to time offer and sell common shares having an aggregate offering price of up to $500.0 million. On May 7, 2021, we amended this ATM equity program, which reset the limit to $500.0 million. The new ATM equity program also allows shares to be sold through forward sales contracts. We intend to use the net proceeds to fund potential acquisition opportunities, fund our development and redevelopment pipeline, repay indebtedness and/or for general corporate purposes.
For the year ended December 31, 2021, we issued 847,471 common shares at a weighted average price per share of $104.19 for net cash proceeds of $87.0 million including paying $0.9 million in commissions and $0.4 million in additional offering expenses related to the sales of these common shares.
We also entered into forward sales contracts for the year ended December 31, 2021 for 2,999,955 common shares under our ATM equity program at a weighted average offering price of $120.22. During 2021, we settled a portion of the forward sales agreements entered into during the year by issuing 796,300 common shares for net proceeds of $85.7 million.
The forward price that we will receive upon physical settlement of the remaining forward sale agreements is subject to the adjustment for (i) commissions, (ii) a floating interest rate factor equal to a specified daily rate less a spread, (iii) the forward purchasers' stock borrowing costs and (iv) scheduled dividends during the term of the forward sale agreements. The remaining open forward shares may be settled at any time on or before multiple required settlement dates ranging from June 2022 to December 2022. As of December 31, 2021, we had the capacity to issue up to $175.0 million in common shares under our ATM equity program.
On April 16, 2021, we repaid $100.0 million of our existing $400.0 million term loan, amended the agreement on the remaining $300.0 million to lower the current spread over LIBOR from 135 basis points to 80 basis points based on our current credit rating, and extended the initial maturity date to April 16, 2024, along with two one-year extensions, at our option.
In 2021, we repaid the following mortgage loans, at par, prior to their original maturity date:
PropertyRepayment DatePrincipal
(in millions)
Sylmar Towne CenterFebruary 5, 2021$16.2 
Plaza Del SolSeptember 1, 2021$7.9 
Montrose CrossingOctober 12, 2021$64.1 
The AVENUE at White MarshNovember 2, 2021$52.7 
Capitalized Costs
Certain external and internal costs directly related to the development, redevelopment and leasing of real estate, including pre-construction costs, real estate taxes, insurance, and construction costs and salaries and related costs of personnel directly involved, are capitalized. We capitalized external and internal costs related to both development and redevelopment activities of $356 million and $10 million, respectively, for 2021 and $404 million and $9 million, respectively, for 2020. We capitalized external and internal costs related to other property improvements of $64 million and $4 million, respectively, for 2021 and $64 million and $3 million, respectively, for 2020. We capitalized external and internal costs related to leasing activities of $19 million and $3 million, respectively, for 2021 and $11 million and $2 million, respectively, for 2020. The amount of capitalized
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internal costs for salaries and related benefits for development and redevelopment activities, other property improvements, and leasing activities were $10 million, $3 million, and $3 million, respectively, for 2021 and $9 million, $3 million, and $2 million, respectively, for 2020. Total capitalized costs were $456 million for 2021 and $494 million for 2020, respectively.
Corporate Reorganization
In January of 2022, we completed the UPREIT reorganization described in the Explanatory Note at the beginning of this Annual Report. Prior to the UPREIT Reorganization, our business was conducted through the Predecessor. This Annual Report pertains to the business and results of operations of the Predecessor for its fiscal year ended December 31, 2021. As a result of the UPREIT reorganization, the Parent Company became the successor issuer to the Predecessor under the Exchange Act. The Parent Company and the Partnership have elected to co-file this Annual Report of the Predecessor to ensure continuity of information to investors. For additional information on our UPREIT reorganization, please see our Current Reports on Form 8-K filed with the SEC on January 3, 2022 and January 5, 2022.
Outlook
Our long-term growth strategy is focused on growth in earnings, funds from operations, and cash flows primarily through a combination of the following:
growth in our comparable property portfolio,
growth in our portfolio from property development and redevelopments, and
expansion of our portfolio through property acquisitions.
While the ongoing COVID-19 pandemic is impacting us in the short-term, our long-term focus has not changed. Our comparable property growth is primarily driven by increases in rental rates on new leases and lease renewals, changes in portfolio occupancy, and the redevelopment of those assets. Over the long-term, the infill nature and strong demographics of our properties provide a strategic advantage allowing us to maintain relatively high occupancy and generally increase rental rates. However, our occupancy levels and ability to increase rental rates will be adversely impacted in the short-term as a result of COVID-19. We believe the locations and nature of our centers and diverse tenant base partially mitigates any potential negative changes in the economic environment. However, any significant reduction in our tenants' abilities to pay base rent, percentage rent or other charges, will adversely affect our financial condition and results of operations. We seek to maintain a mix of strong national, regional, and local retailers. At December 31, 2021, no single tenant accounted for more than 2.7% of annualized base rent.
Federal, state, and local governments have taken various actions to mitigate the spread of COVID-19, including initially ordering closures of non-essential businesses and ordering residents to generally stay at home. While many of these restrictions have since been lifted, they required a significant number of tenants to close their operations or to significantly limit the amount of business they were able to conduct in their stores. These closures and restrictions, along with general concerns over the spread of COVID-19 have impacted the tenants' ability to timely pay rent as required under our leases and also caused many tenants to close their business permanently. While we are seeing signs of considerable improvement, these economic hardships have adversely impacted our business, and continue to have a negative effect on our financial results during 2021. With very few exceptions, our leases require tenants to continue to pay rent even while closed as a result of the pandemic, and while many tenants did not pay rents and other charges during a portion of 2020, the majority of our tenants have resumed paying all or a portion of their rent and/or other charges as their businesses were able to reopen. Our percentage of contractual rent actually collected has continued to increase since the low point in April 2020, including some tenants paying past due amounts. As of December 31, 2021, we have entered into agreements with approximately 32% of our tenants (based on total commercial leases) to defer rent payments to later periods, largely through 2022, although some extend beyond. While increasing monthly cash collection rates is a positive trend driven by government mandated restrictions gradually being lifted and improved outlook by some tenants, we expect that our rent collections will continue to be below our tenants' contractual rent obligations and historical levels into 2022, which will continue to adversely impact our results of operations. We are also experiencing a lower level of occupancy than in our past, largely due to the pandemic, which will adversely impact our results until we can release the space and the tenant commences paying rent as well as limit future vacancies caused by the pandemic. We are, however, experiencing strong demand for our commercial space as evidenced by the 2.1 million square feet of comparable space retail leasing we've completed in 2021, as well as our overall leased percentage at 93.6%, compared to our occupied percentage of only 91.1%. We have begun to see impacts of overall supply chain disruptions affecting the broader economy, including significantly longer lead times, limited availability, and increased costs for certain construction and other materials that support our leasing, development, and redevelopment activities. If disruptions continue to worsen, they could result in extended timeframes and/or increased costs for completion of our projects and tenant build-outs, which could delay the commencement of rent payments under new leases. Similarly, if our tenants experience significant disruptions in supply chains supporting their own products, or staffing issues due to labor shortages, their ability to pay rent may be adversely affected. We continue to
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monitor these macroeconomic developments and are working with our tenants and our vendors to limit the overall impact to our business.
The extent of such impact from COVID-19 will depend on future developments, which are highly uncertain and cannot be predicted. Depending upon the duration of tenant closures, future operating restrictions, and the overall economic downturn resulting from COVID-19, we may find that even deferred rents are difficult to collect, and we may experience higher vacancy levels. While the duration and severity of the economic impact resulting from COVID-19 is unknown, we seek to position the Trust to continue to participate in the resulting economic recovery.

We continue to have several development projects in process being delivered as follows:
Phase III of Assembly Row includes 277,000 square feet of office space, 56,000 square feet of retail space, and 500 residential units. The expected costs for Phase III are between $465 million and $485 million with spaces being delivered beginning in the second quarter of 2021. At December 31, 2021, 162,000 square feet of office space has been delivered, all of the units in the residential building have been delivered, and 23,000 square feet of retail space has opened.
Phase III at Pike & Rose includes a 212,000 square foot office building (which includes 7,000 square feet of ground floor retail space). The building is expected to cost between $128 million and $135 million. At December 31, 2021, approximately 162,000 square feet of office and retail space has been delivered, of which approximately 45,000 square feet is our new corporate headquarters.
Phase IV at Pike & Rose is a 276,000 square foot office building (which includes 10,000 square feet of ground floor retail space). Approximately 105,000 square feet of the office space is pre-leased to a single tenant. The building is expected to cost between $185 million and $200 million, and begin delivering in late 2023.
The first phase of construction on Santana West includes an eight story 376,000 square foot office building, which is expected to cost between $250 million and $270 million.
Throughout the portfolio, we currently have redevelopment projects underway with a projected total cost of approximately $313 million that we expect to stabilize over the next several years.

The above includes our best estimates based on information currently known, however, the completion of construction, final costs, and the timing of leasing and openings may be further impacted by the current environment including the duration and severity of the economic impacts of COVID-19 and supply chain disruptions affecting the broader economy.
The development of future phases of Assembly Row, Pike & Rose and Santana Row will be pursued opportunistically based on, among other things, market conditions, tenant demand, and our evaluation of whether those phases will generate an appropriate financial return.
We continue to review acquisition opportunities that complement our portfolio and provide long-term growth opportunities. Initially, some of our acquisitions do not contribute significantly to earnings growth; however, we believe they provide long-term re-leasing growth, redevelopment opportunities, and other strategic opportunities. Any growth from acquisitions is contingent on our ability to find properties that meet our qualitative standards at prices that meet our financial hurdles. Changes in interest rates may affect our success in achieving earnings growth through acquisitions by affecting both the price that must be paid to acquire a property, as well as our ability to economically finance the property acquisition. Generally, our acquisitions are initially financed by available cash and/or borrowings under our revolving credit facility which may be repaid later with funds raised through the issuance of new equity or new long-term debt. We may also finance our acquisitions through the issuance of common shares, preferred shares, or units in our operating partnership (see "Corporate Reorganization" discussion in this Item 7), as well as through assumed mortgages and property sales.
At December 31, 2021, the leasable square feet in our properties was 93.6% leased and 91.1% occupied. The leased rate is higher than the occupied rate due to leased spaces that are being redeveloped or improved or that are awaiting permits and, therefore, are not yet ready to be occupied. Our occupancy and leased rates are subject to variability over time due to factors including acquisitions, the timing of the start and stabilization of our redevelopment projects, lease expirations and tenant closings and bankruptcies.
Comparable Properties
Throughout this section, we have provided certain information on a “comparable property” basis. Information provided on a comparable property basis includes the results of properties that we owned and operated for the entirety of both periods being compared except for properties that are currently under development or are being repositioned for significant redevelopment and investment. For the year ended December 31, 2021 and the comparison of 2021 and 2020, all or a portion of 95 properties were considered comparable properties and seven were considered non-comparable properties. For the year ended December 31, 2021, two portions of properties were moved from non-comparable properties to comparable properties, one
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property and two portions of properties were moved from acquisitions to comparable properties, one property was moved from comparable properties to non-comparable properties, two properties and one portion of a property were removed from comparable properties as they were sold, and two portions of properties were removed from non-comparable properties, as they were sold, compared to the designations as of December 31, 2020. While there is judgment surrounding changes in designations, we typically move non-comparable properties to comparable properties once they have stabilized, which is typically considered 90% physical occupancy or when the growth expected from the redevelopment has been included in the comparable periods. We typically remove properties from comparable properties when the repositioning of the asset has commenced and has or is expected to have a significant impact to property operating income within the calendar year. Acquisitions are moved to comparable properties once we have owned the property for the entirety of comparable periods and the property is not under development or being repositioned for significant redevelopment and investment. Comparable property information replaces our previous same center designations.
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YEAR ENDED DECEMBER 31, 2021 COMPARED TO YEAR ENDED DECEMBER 31, 2020
 
   Change
 20212020Dollars%
 (Dollar amounts in thousands)
Rental income$948,842 $832,171 $116,671 14.0 %
Mortgage interest income2,382 3,323 (941)(28.3)%
Total property revenue951,224 835,494 115,730 13.9 %
Rental expenses198,121 170,920 27,201 15.9 %
Real estate taxes118,496 119,242 (746)(0.6)%
Total property expenses316,617 290,162 26,455 9.1 %
Property operating income (1)
634,607 545,332 89,275 16.4 %
General and administrative expense(49,856)(41,680)(8,176)19.6 %
Depreciation and amortization(279,976)(255,027)(24,949)9.8 %
Impairment charge— (57,218)57,218 100.0 %
Gain on sale of real estate and change in control of interest89,950 98,117 (8,167)(8.3)%
Operating income394,725 289,524 105,201 36.3 %
Other interest income809 1,894 (1,085)(57.3)%
Interest expense(127,698)(136,289)8,591 (6.3)%
Early extinguishment of debt— (11,179)11,179 100.0 %
Income (loss) from partnerships1,245 (8,062)9,307 115.4 %
Total other, net(125,644)(153,636)27,992 (18.2)%
Net income269,081 135,888 133,193 98.0 %
Net income attributable to noncontrolling interests(7,583)(4,182)(3,401)81.3 %
Net income attributable to the Trust$261,498 $131,706 $129,792 98.5 %
(1) Property operating income is a non-GAAP measure. See "Summary Financial Information" in this Item 7 for further discussion.

Property Revenues
Total property revenue increased $115.7 million, or 13.9%, to $951.2 million in 2021 compared to $835.5 million in 2020. The percentage occupied at our shopping centers was 91.1% at December 31, 2021 compared to 90.2% at December 31, 2020. The most significant driver of the increase in property revenues is the generally lifted COVID-19 restrictions during 2021, as compared to 2020 when COVID-19 government imposed closures and restrictions were generally still in effect. Changes in the components of property revenue are discussed below.
Rental Income
Rental income consists primarily of minimum rent, cost reimbursements from tenants and percentage rent, and is net of collectibility related adjustments. Rental income increased $116.7 million, or 14.0%, to $948.8 million in 2021 compared to $832.2 million in 2020 due primarily to the following:
an $82.6 million decrease in collectibility related impacts including rent abatements across all properties, primarily due to higher collection rates in 2021 as tenants begin to recover from the initial impacts of COVID-19, and moving a large number of tenants from accrual basis to cash basis in 2020,
an increase of $32.2 million primarily from 2021 acquisitions (see Note 3 to the consolidated financial statements for additional information), and
an increase of $25.4 million from non-comparable properties driven by the opening of Phase III at Assembly Row in 2021 and our Phase III office building at Pike & Rose in 2020, redevelopment related occupancy increases at CocoWalk, the opening of our new office building at Santana Row in early 2020, higher net termination fees, and the opening of Freedom Plaza in 2020,
partially offset by
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a decrease of $17.1 million from property sales, and
a decrease of $6.1 million at comparable properties due primarily to lower average occupancy of approximately $14.1 million, lower net termination fees and legal fee income of $5.1 million, and a $2.1 million decrease in recoveries primarily related to real estate tax recoveries, partially offset by higher percentage rent, specialty leasing, and parking income of $7.2 million, primarily due to the impact of COVID-19 related closures and restrictions in 2020, and higher rental rates of $6.7 million.
Mortgage Interest Income
Mortgage interest income decreased $0.9 million, or 28.3%, to $2.4 million in 2021 compared to $3.3 million in 2020 primarily due to the payoff of two mortgage notes receivable in May 2021 (see Note 2 to the consolidated financial statements for additional information).
Property Expenses
Total property expenses increased $26.5 million, or 9.1%, to $316.6 million in 2021 compared to $290.2 million in 2020. Changes in the components of property expenses are discussed below.
Rental Expenses
Rental expenses increased $27.2 million, or 15.9%, to $198.1 million in 2021 compared to $170.9 million in 2020. This increase is primarily due to the following:
an increase of $19.3 million from comparable properties due to higher repairs and maintenance costs, demolition costs, and utilities, as 2020 had lower costs as a result of COVID-19 impacts, higher snow removal costs, and higher insurance costs,
an increase of $8.8 million primarily from 2021 acquisitions, and
an increase of $6.1 million from non-comparable properties driven by the opening of Phase III at Assembly Row in 2021, the Phase III office building at Pike & Rose in 2020, the CocoWalk redevelopment in late 2020, and the opening of our new office building at Santana Row in early 2020,
partially offset by
a decrease of $5.0 million from our property sales.
As a result of the changes in rental income and rental expenses as discussed above, rental expenses as a percentage of rental income increased to 20.9% for the year ended December 31, 2021 from 20.5% for the year ended December 31, 2020.
Real Estate Taxes
Real estate tax expense decreased $0.7 million, or 0.6% to $118.5 million in 2021 compared to $119.2 million in 2020 due primarily to the following:
a decrease of $3.5 million from our property sales, and
a decrease of $3.3 million from comparable properties primarily due to a true-up of supplemental taxes at several of our California properties billed in 2020 and prior year tax refunds recorded in 2021,
partially offset by
an increase of $3.1 million from 2021 acquisitions, and
an increase of $2.9 million from non-comparable properties due primarily to the opening of Phase III at Assembly Row in 2021, the opening of our new office building at Santana Row in early 2020, increases in assessments as a result of our redevelopment activities, and the Phase III office building at Pike & Rose in 2020.
Property Operating Income
Property operating income increased $89.3 million, or 16.4%, to $634.6 million in 2021 compared to $545.3 million in 2020. This increase is primarily due to the lifting of COVID-19 restrictions during 2021, which resulted in lower collectibility related adjustments and higher specialty leasing, percentage rent, and parking income. Also contributing to the increases were property acquisitions, placing redevelopment properties into service, the opening of Phase III at Assembly Row in 2021, and the opening of our new office building at Santana Row in early 2020, partially offset by lower average occupancy, property dispositions, higher repairs and maintenance and utilities expense, and higher snow removal expense.
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Other Operating

General and Administrative Expense
General and administrative expense increased $8.2 million, or 19.6%, to $49.9 million in 2021 from $41.7 million in 2020. This increase is due primarily to higher personnel related costs.
Depreciation and Amortization
Depreciation and amortization expense increased $24.9 million, or 9.8%, to $280.0 million in 2021 from $255.0 million in 2020. This increase is due primarily to 2021 property acquisitions, accelerated depreciation related to the demolition of one of our buildings in the early stages of redevelopment, the opening of Phase III of Assembly Row and the Pike & Rose, placing redevelopment properties into service, and the acquisition of the previously unconsolidated Pike & Rose hotel joint venture in January 2021, partially offset by 2020 property sales and the lower write-off of lease related assets for vacating tenants.
Impairment Charge
The $57.2 million impairment charge for the year ended December 31, 2020 relates to The Shops at Sunset Place. See Note 3 to the consolidated financial statements for further discussion.
Gain on Sale of Real Estate and Change in Control of Interest
The $90.0 million gain on sale of real estate for the year ended December 31, 2021 is due to the sale of two properties and portions of three properties, as well as the $2.1 million gain relating to the acquisition of the previously unconsolidated Pike & Rose hotel join venture (see Note 3 to the consolidated financial statements for additional information).
The $98.1 million gain on sale of real estate, net of tax for the year ended December 31, 2020 is due to the sale of three properties and one building.
Operating Income
Operating income increased $105.2 million, or 36.3%, to $394.7 million in 2021 compared to $289.5 million in 2020. This increase is primarily due to the lifting of COVID-19 restrictions, which resulted in lower collectibility related adjustments and higher specialty leasing, percentage rent, and parking income compared to 2020. Also contributing to the increases were the prior year impairment charge related to The Shops at Sunset Place, property acquisitions, placing redevelopment properties into service, the opening of Phase III at Assembly Row in 2021, and the opening of our new office building at Santana Row in early 2020, partially offset by lower average occupancy, higher personnel related costs, property dispositions, higher repairs and maintenance and utilities expense, a lower gain on sales of real estate, and higher snow removal expense.
Other
Interest Expense
Interest expense decreased $8.6 million, or 6.3%, to $127.7 million in 2021 compared to $136.3 million in 2020. This decrease is due primarily to the following:
a decrease of $6.2 million due to a lower overall weighted average borrowing rate, and
a decrease of $3.2 million due to lower weighted average borrowings,
partially offset by
a decrease of $0.8 million in capitalized interest.
Gross interest costs were $150.3 million and $159.7 million in 2021 and 2020, respectively. Capitalized interest was $22.6 million and $23.4 million in 2021 and 2020, respectively.
Early Extinguishment of Debt
The $11.2 million early extinguishment of debt charge for the year ended December 31, 2020 relates to the make-whole premium paid as part of the early redemption of our $250 million 3.00% senior notes on December 31, 2020 and the related write-off of the unamortized discount and debt fees.
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Income (loss) from Partnerships
Income (loss) from partnerships increased $9.3 million or 115.4% to $1.2 million of income in 2021 compared to a loss of $8.1 million in 2020. This increase is due primarily to the acquisition of the previously unconsolidated Pike & Rose hotel joint venture in January 2021 and improved operating results at our restaurant joint ventures and at our Assembly Row hotel joint venture, largely the result of the easing of COVID-19 closures and restrictions.
Net income attributable to noncontrolling interests
Net income attributable to noncontrolling interests increased $3.4 million, or 81.3%, to $7.6 million in 2021 compared to $4.2 million in 2020. The increase is primarily due to The Shops at Sunset Place prior year impairment charge and 2021 acquisitions.

Discussions of year-to-year comparisons between 2020 and 2019 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed with the Securities and Exchange Commission on February 11, 2021.

Liquidity and Capital Resources
Due to the nature of our business and strategy, we typically generate significant amounts of cash from operations which is largely paid to our common and preferred shareholders in the form of dividends because as a REIT, we are generally required to make annual distributions to shareholders of at least 90% of our taxable income (cash dividends paid in 2021 were approximately $337.4 million). Remaining cash flow from operations after dividend payments is used to fund recurring and non-recurring capital projects (such as tenant improvements and redevelopments), and regular debt service requirements (including debt service relating to additional or replacement debt, as well as scheduled debt maturities). We maintain a $1.0 billion revolving credit facility to fund short term cash flow needs and also look to the public and private debt and equity markets, joint venture relationships, and property dispositions to fund capital expenditures on a long-term basis.
During 2021, we have continued to see improvements in overall cash collections from tenants as compared to 2020, although not yet at pre-COVID-19 levels (see further discussion under the "Outlook" section of this Item 2). While the overall economic impacts of the pandemic are unknown, we have taken multiple steps to strengthen our financial position, maximize liquidity, and to provide maximum flexibility during these uncertain times, including maintaining levels of cash in excess of the cash balances we have historically maintained.
As of December 31, 2021, there is no balance outstanding on our $1.0 billion unsecured revolving credit facility and we had cash and cash equivalents of $162.1 million. We also had outstanding forward sales agreements for net proceeds of $264.0 million as of December 31, 2021, and the capacity to issue up to $175.0 million in common shares under the ATM program. We have no debt maturing until June 2023.
For the year ended 2021, the weighted average amount of borrowings outstanding on our revolving credit facility was $19.6 million, and the weighted average interest rate, before amortization of debt fees, was 0.9%.
Our overall capital requirements during 2022 will be impacted by the extent and duration of COVID-19 related closures and restrictions, impacts on our cash collections, and overall economic impacts that might occur including supply chain issues. Cash requirements will also be impacted by acquisition opportunities and the level and general timing of our redevelopment and development activities. While the amount of future expenditures will depend on numerous factors, we expect to continue to see elevated levels of investment as we continue to invest in our overall portfolio to better position our properties for a post-COVID environment, costs to prepare vacant space for new tenants, and investments to complete the current phase and start on the next phase of our larger mixed-use development projects although at a slightly reduced level from 2021, largely due to deliveries in 2021 of our third phase of Assembly Row.
We believe that the cash on our balance sheet together with rents we collect, as well as our $1.0 billion revolving credit facility will allow us to continue to operate our business through the remainder of the COVID-19 pandemic. Given our ability to access the capital markets, we also expect debt or equity to be available to us. We also have the ability to delay the timing of certain development and redevelopment projects as well as limit future acquisitions, reduce our operating expenditures, or re-evaluate our dividend policy.
While we have seen improvements from the initial negative impacts of the COVID-19 pandemic, it has continued to affect our
overall business during the year ended December 31, 2021, and we expect it will continue to negatively impact our business in the short term, we intend to operate with and to maintain our long term commitment to a conservative capital structure that will
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allow us to maintain strong debt service coverage and fixed-charge coverage ratios as part of our commitment to investment-grade debt ratings.
Summary of Cash Flows
 
 Year Ended December 31,
 20212020
 (In thousands)
Net cash provided by operating activities$471,352 $369,929 
Net cash used in investing activities(660,118)(368,383)
Net cash (used in) provided by financing activities(452,967)661,736 
(Decrease) increase in cash and cash equivalents(641,733)663,282 
Cash, cash equivalents, and restricted cash, beginning of year816,896 153,614 
Cash, cash equivalents, and restricted cash, end of year$175,163 $816,896 

Net cash provided by operating activities increased $101.4 million to $471.4 million during 2021 from $369.9 million during 2020. The increase was primarily attributable to higher net income before non-cash items and the timing of cash receipts including higher accounts receivable and lower prepaid rent balances in 2020 as a result of the COVID-19 pandemic.
Net cash used in investing activities increased $291.7 million to $660.1 million during 2021 from $368.4 million during 2020. The increase was primarily attributable to:
a $356.9 million increase in acquisition of real estate primarily due to 2021 property acquisitions (see Note 3 to the consolidated financial statements for additional information), and
a $45.6 million decrease in proceeds from sales of real estate, resulting from the sale of two properties and a portion of three properties in 2021, as compared to the sale of three properties, one building, and the two remaining condominium units at our Pike & Rose property in 2020,
partially offset by
a $54.5 million decrease in net capital expenditures and leasing costs,
a $41.4 million increase in net repayments and acquisitions of mortgages and other notes receivable primarily due to the $31.1 million payoff of two mortgage notes receivable in May 2021, as compared to the $9.6 million acquisition of two mortgage notes receivable in September 2020, and
$12.9 million paid in 2020 relating to the partial sale under threat of condemnation at San Antonio Center in 2019.
Net cash provided by financing activities decreased $1.1 billion to $453.0 million used during 2021 from $661.7 million provided during 2020. The decrease was primarily attributable to:
a $1.1 billion decrease due to net proceeds of $700.1 million from the issuance of $400.0 million of 3.50% unsecured senior notes and the $300.0 million reopening of our 3.95% unsecured senior notes in May 2020, and $394.2 million in net proceeds from our $400.0 million of 1.25% unsecured senior notes in October 2020,
$398.7 million in net proceeds from our unsecured term loan in May 2020,
a $207.4 million increase in repayment of mortgages, finance leases, and notes payable primarily due to the $140.9 million net repayments of four mortgage loans in 2021 (see Note 5 to the consolidated financial statements for more information), the $100.0 million repayment of our $400.0 million term loan which was amended in April 2021, and the $31.5 million repayment of the mortgage loan encumbering the Pike & Rose hotel in January 2021, partially offset by the $60.6 million payoff of the mortgage loan on The Shops at Sunset Place in December 2020 and the $3.6 million payoff of the mortgage loan on 29th Place, both in December 2020, and
an $11.1 million increase in dividends paid to shareholders due to an increase in the common share dividend rate and an increase in the number of common shares outstanding,
partially offset by,
$510.4 million from the December 2020 redemptions of our $250.0 million 2.55% unsecured senior notes and our $250.0 million 3.00% unsecured senior notes, with a make-whole premium of $10.4 million,
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$73.8 million increase in net proceeds from the issuance of 1.6 million common shares under our ATM program for net proceeds of $172.7 million (see Note 8 to our consolidated financial statements for additional details on these transactions), as compared to 1.1 million common shares for net proceeds of $98.8 million in 2020, and
a $10.8 million decrease in distributions to and redemptions of noncontrolling interests primarily due to the 2020 acquisition of one of our partner's interests in the partnership that owns our Plaza El Segundo property for $7.3 million.
Cash Requirements
The following table provides a summary of material cash requirements comprising our fixed, noncancelable obligations as of December 31, 2021:
 Cash Requirements by Period
TotalNext Twelve MonthsGreater than Twelve Months
(In thousands)
Fixed and variable rate debt (principal only) (1)$4,063,414 $4,095 4,059,319 
Fixed and variable rate debt - our share of unconsolidated real estate partnerships (principal only)(2)28,560 418 28,142 
Lease obligations (minimum rental payments) (3)352,162 11,001 341,161 
Redevelopments/capital expenditure contracts319,171 267,490 51,681 
Real estate commitments (4)98,691 — 98,691 
Total estimated cash requirements$4,861,998 $283,004 $4,578,994 
 _____________________
(1)The weighted average interest rate on our fixed and variable rate debt is 3.3% as of December 31, 2021.
(2)The weighted average interest rate on the fixed and variable rate debt related to our unconsolidated real estate partnerships is 4.24% as of December 31, 2021.
(3)This includes minimum rental payments related to both finance and operating leases.
(4)This includes the liability related to the sale under threat of condemnation at San Antonio Center as further discussed in Note 7 to the consolidated financial statements.
In addition to the amounts set forth in the table above and other liquidity requirements previously discussed, the following potential commitments exist:
(a)Under the terms of the Congressional Plaza partnership agreement, a minority partner has the right to require us and the other minority partner to purchase its 26.63% interest in Congressional Plaza at the interest’s then-current fair market value. If the other minority partner defaults in their obligation, we must purchase the full interest. Based on management’s current estimate of fair market value as of December 31, 2021, our estimated liability upon exercise of the put option would range from approximately $67 million to $71 million.
(b)Under the terms of various other partnership agreements, the partners have the right to exchange their operating partnership units for cash or the same number of our common shares, at our option. As of December 31, 2021, a total of 666,831 downREIT operating partnership units are outstanding.
(c)Two of the members in Plaza El Segundo have the right to require us to purchase their 10.0% and 11.8% ownership interests at the interests' then-current fair market value. If the members fail to exercise their put options, we have the right to purchase each of their interests on or after December 30, 2026 at fair market value. Based on management’s current estimate of fair market value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from approximately $25 million to $28 million.
(d)The other member in The Grove at Shrewsbury and Brook 35 has the right to require us to purchase all of its approximately 4.1% interest in The Grove at Shrewsbury and approximately 6.5% interest in Brook 35 at the interests' then-current fair market value. Based on management's current estimate of fair market value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $6 million to $7 million.
(e)Effective September 18, 2023, the other member in Hoboken has the right to require us to purchase all of its 10% ownership interest at the interest's then-current fair market value. Based on management's current estimate of fair market value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $9 million to $10 million.
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(f)Effective June 14, 2026, the other member in Cambelback Colonnade and Hilton Village has the right to require us to purchase all of its 2.0% ownership interest at the interest's then-current fair market value. Based on management's current estimate of fair value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $4 million to $5 million.
(g)Effective June 1, 2029, the other member in Grossmont Center has the right to require us to purchase all of its 40.0% ownership interest at the interest's then-current fair market value. Based on management's current estimate of fair value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $68 million to $73 million.
(h)At December 31, 2021, we had letters of credit outstanding of approximately $4.8 million.

Off-Balance Sheet Arrangements
At December 31, 2021, we have two real estate related equity method investments with total debt outstanding of $79.8 million, of which our share is $28.6 million. Our investment in these ventures at December 31, 2021 was $8.9 million.
Other than the items disclosed in the Cash Requirements table, we have no off-balance sheet arrangements as of December 31, 2021 that are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, cash requirements, or capital resources.

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Debt Financing Arrangements
The following is a summary of our total debt outstanding as of December 31, 2021:
Description of DebtOriginal
Debt
Issued
Principal Balance as of December 31, 2021Stated Interest Rate as of December 31, 2021Maturity Date
 (Dollars in thousands)  
Mortgages payable
Secured fixed rate
AzaleaAcquired$40,000 3.73 %November 1, 2025
Bell GardensAcquired12,127 4.06 %August 1, 2026
Plaza El Segundo125,000 125,000 3.83 %June 5, 2027
The Grove at Shrewsbury (East)43,600 43,600 3.77 %September 1, 2027
Brook 3511,500 11,500 4.65 %July 1, 2029
Hoboken (24 Buildings) (1)56,450 56,450 LIBOR + 1.95%December 15, 2029
Various Hoboken (14 Buildings)Acquired31,817 Various (2)Various through 2029
ChelseaAcquired4,851 5.36 %January 15, 2031
Hoboken (1 Building) (3)Acquired16,234 3.75 %July 1, 2042
Subtotal341,579 
Net unamortized debt issuance costs and premium(1,586)
Total mortgages payable, net339,993 
Notes payable
Revolving credit facility (4)1,000,000 — LIBOR + 0.775%January 19, 2024
Term Loan400,000 300,000 LIBOR + 0.80%April 16, 2024
Various7,239 2,635 11.31 %Various through 2028
Subtotal302,635 
Net unamortized debt issuance costs(1,169)
Total notes payable, net301,466 
Senior notes and debentures
Unsecured fixed rate
2.75% notes275,000 275,000 2.75 %June 1, 2023
3.95% notes600,000 600,000 3.95 %January 15, 2024
1.25% notes400,000 400,000 1.25 %February 15, 2026
7.48% debentures50,000 29,200 7.48 %August 15, 2026
3.25% notes475,000 475,000 3.25 %July 15, 2027
6.82% medium term notes40,000 40,000 6.82 %August 1, 2027
3.20% notes400,000 400,000 3.20 %June 15, 2029
3.50% notes400,000 400,000 3.50 %June 1, 2030
4.50% notes550,000 550,000 4.50 %December 1, 2044
3.625% notes250,000 250,000 3.625 %August 1, 2046
Subtotal3,419,200 
Net unamortized debt issuance costs and premium(13,112)
Total senior notes and debentures, net3,406,088 
Total debt, net$4,047,547 
_____________________
1)On November 26, 2019, we entered into two interest rate swap agreements that fix the interest rate on the mortgage loan at 3.67%.
2)The interest rates on these mortgages range from 3.91% to 5.00%.
3)This mortgage loan has a fixed interest rate, however, the rate resets every five years until maturity. The current interest rate is fixed until July 1, 2022, and the loan is prepayable at par anytime after this date.
4)The maximum amount drawn under our revolving credit facility during 2021 was $150.0 million and the weighted average effective interest rate on borrowings under our revolving credit facility, before amortization of debt fees, was 0.9%.
Our revolving credit facility, unsecured term loan, and other debt agreements include financial and other covenants that may limit our operating activities in the future. As of December 31, 2021, we were in compliance with all of the financial and other covenants related to our revolving credit facility, term loan, and senior notes. Additionally, we were in compliance with all of the financial and other covenants that could trigger a loan default on our mortgage loans. If we were to breach any of these financial and other covenants and did not cure the breach within an applicable cure period, our lenders could require us to repay
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the debt immediately and, if the debt is secured, could immediately begin proceedings to take possession of the property securing the loan. Many of our debt arrangements, including our public notes and our revolving credit facility, are cross-defaulted, which means that the lenders under those debt arrangements can put us in default and require immediate repayment of their debt if we breach and fail to cure a default under certain of our other debt obligations. As a result, any default under our debt covenants could have an adverse effect on our financial condition, our results of operations, our ability to meet our obligations and the market value of our shares. Our organizational documents do not limit the level or amount of debt that we may incur.
The following is a summary of our scheduled principal repayments as of December 31, 2021:
 
UnsecuredSecuredTotal
 (In thousands) 
2022$744 $3,351 $4,095   
2023275,758 3,549 279,307   
2024900,659 (1) (2)3,688 904,347   
2025383 48,033 48,416   
2026429,254 26,657 455,911   
Thereafter2,115,037   256,301 2,371,338   
$3,721,835   $341,579 $4,063,414 (3)
_____________________
1)Our $300.0 million term loan matures on April 16, 2024, plus two one-year extensions, at our option.
2)Our $1.0 billion revolving credit facility matures on January 19, 2024, plus two six-month extensions at our option. As of December 31, 2021, there was no outstanding balance under this credit facility.
3)The total debt maturities differ from the total reported on the consolidated balance sheet due to the unamortized net debt issuance costs and premium/discount on mortgage loans, notes payable, and senior notes as of December 31, 2021.
Interest Rate Hedging
We may use derivative instruments to manage exposure to variable interest rate risk. We generally enter into interest rate swaps to manage our exposure to variable interest rate risk and treasury locks to manage the risk of interest rates rising prior to the issuance of debt. We enter into derivative instruments that qualify as cash flow hedges and do not enter into derivative instruments for speculative purposes.
Interest rate swaps associated with cash flow hedges are recorded at fair value on a recurring basis. Effectiveness of cash flow hedges is assessed both at inception and on an ongoing basis. The effective portion of changes in fair value of the interest rate swaps associated with cash flow hedges is recorded in other comprehensive income (loss) which is included in "accumulated other comprehensive loss" on the balance sheet and statement of shareholders' equity. Cash flow hedges become ineffective if critical terms of the hedging instrument and the debt instrument do not perfectly match such as notional amounts, settlement dates, reset dates, calculation period and LIBOR rate. In addition, the default risk of the counterparty is evaluated by monitoring the credit worthiness of the counterparty which includes reviewing debt ratings and financial performance. If a cash flow hedge is deemed ineffective, the ineffective portion of changes in fair value of the interest rate swaps associated with cash flow hedges is recognized in earnings in the period affected.
As of December 31, 2021, we have two interest rate swap agreements that effectively fix the interest rate on a mortgage payable associated with our Hoboken portfolio at 3.67%. Our Assembly Row hotel joint venture is also a party to two interest rate swap agreements that effectively fix their debt at 5.206%. All swaps were designated and qualify as cash flow hedges. Hedge ineffectiveness has not impacted our earnings in 2021, 2020 and 2019.
REIT Qualification
We intend to maintain our qualification as a REIT under Section 856(c) of the Code. As a REIT, we generally will not be subject to corporate federal income taxes on income we distribute to our shareholders as long as we satisfy certain technical requirements of the Code, including the requirement to distribute at least 90% of our taxable income to our shareholders.
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Funds From Operations
Funds from operations (“FFO”) is a supplemental non-GAAP financial measure of real estate companies’ operating performance. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as follows: net income, computed in accordance with U.S. GAAP, plus real estate related depreciation and amortization, and excluding gains and losses on the sale of real estate or changes in control, net of tax, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. We compute FFO in accordance with the NAREIT definition, and we have historically reported our FFO available for common shareholders in addition to our net income and net cash provided by operating activities. It should be noted that FFO:
does not represent cash flows from operating activities in accordance with GAAP (which, unlike FFO, generally reflects all cash effects of transactions and other events in the determination of net income);
should not be considered an alternative to net income as an indication of our performance; and
is not necessarily indicative of cash flow as a measure of liquidity or ability to fund cash needs, including the payment of dividends.
We consider FFO available for common shareholders a meaningful, additional measure of operating performance primarily because it excludes the assumption that the value of the real estate assets diminishes predictably over time, as implied by the historical cost convention of GAAP and the recording of depreciation. We use FFO primarily as one of several means of assessing our operating performance in comparison with other REITs. Comparison of our presentation of FFO to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of the NAREIT definition used by such REITs.
An increase or decrease in FFO available for common shareholders does not necessarily result in an increase or decrease in aggregate distributions because our Board of Trustees is not required to increase distributions on a quarterly basis. However, we must distribute at least 90% of our annual taxable income to remain qualified as a REIT. Therefore, a significant increase in FFO will generally require an increase in distributions to shareholders although not necessarily on a proportionate basis.
The reconciliation of net income to FFO available for common shareholders is as follows:
 Year Ended December 31,
 202120202019
 (In thousands, except per share data)
Net income$269,081 $135,888 $360,542 
Net income attributable to noncontrolling interests(7,583)(4,182)(6,676)
Gain on sale of real estate and change in control of interests, net(89,892)(91,922)(116,393)
Impairment charge, net — 50,728 — 
Depreciation and amortization of real estate assets243,711 228,850 215,139 
Amortization of initial direct costs of leases26,051 20,415 19,359 
Funds from operations441,368 339,777 471,971 
Dividends on preferred shares (1)(8,042)(8,042)(7,500)
Income attributable to operating partnership units2,998 3,151 2,703 
Income attributable to unvested shares(1,581)(1,037)(1,355)
Funds from operations available for common shareholders (2)$434,743 $333,849 $465,819 
Weighted average number of common shares, diluted (1)(2)(3)78,072 76,261 75,514 
Funds from operations available for common shareholders, per diluted share (2)$5.57 $4.38 $6.17 
_____________________
(1)For the year ended December 31, 2019, dividends on our Series 1 preferred stock were not deducted in the calculation of FFO available to common shareholders, as the related shares were dilutive and included in "weighted average common shares, diluted."
(2)For the year ended December 31, 2020, FFO available for common shareholders includes a $11.2 million charge related to early extinguishment of debt. If this charge was excluded, our FFO available for common shareholders for 2020 would have been $345.0 million, and FFO available for common shareholders, per diluted share would have been $4.52. For the year ended December 31, 2019, FFO available for common shareholders includes an $11.9 million charge relating to the buyout of a lease at Assembly Square Marketplace. If this charge was excluded, our FFO
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available for common shareholders for 2019 would have been $477.7 million, and FFO available for common shareholders, per diluted share would have been $6.33.
(3)The weighted average common shares used to compute FFO per diluted common share includes operating partnership units that were excluded from the computation of diluted EPS. Conversion of these operating partnership units is dilutive in the computation of FFO per diluted common share but is anti-dilutive for the computation of diluted EPS for the periods presented.
ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our use of financial instruments, such as debt instruments, subjects us to market risk which may affect our future earnings and cash flows, as well as the fair value of our assets. Market risk generally refers to the risk of loss from changes in interest rates and market prices. We manage our market risk by attempting to match anticipated inflow of cash from our operating, investing and financing activities with anticipated outflow of cash to fund debt payments, dividends to common and preferred shareholders, investments, capital expenditures and other cash requirements.
We may enter into certain types of derivative financial instruments to further reduce interest rate risk. We use interest rate protection and swap agreements, for example, to convert some of our variable rate debt to a fixed-rate basis or to hedge anticipated financing transactions. We use derivatives for hedging purposes rather than speculation and do not enter into financial instruments for trading purposes.
Interest Rate Risk
The following discusses the effect of hypothetical changes in market rates of interest on interest expense for our variable rate debt and on the fair value of our total outstanding debt, including our fixed-rate debt. Interest rate risk amounts were determined by considering the impact of hypothetical interest rates on our debt. Quoted market prices were used to estimate the fair value of our marketable senior notes and debentures and discounted cash flow analysis is generally used to estimate the fair value of our mortgages and notes payable. Considerable judgment is necessary to estimate the fair value of financial instruments. This analysis does not purport to take into account all of the factors that may affect our debt, such as the effect that a changing interest rate environment could have on the overall level of economic activity or the action that our management might take to reduce our exposure to the change. This analysis assumes no change in our financial structure.

Fixed Interest Rate Debt
The majority of our outstanding debt obligations (maturing at various times through 2046) have fixed interest rates which limit the risk of fluctuating interest rates. However, interest rate fluctuations may affect the fair value of our fixed rate debt instruments. At December 31, 2021, we had $3.7 billion of fixed-rate debt outstanding, including $56.5 million in mortgage payables that are effectively fixed by two interest rate swap agreements. If market interest rates used to calculate the fair value on our fixed-rate debt instruments at December 31, 2021 had been 1.0% higher, the fair value of those debt instruments on that date would have decreased by approximately $256.6 million. If market interest rates used to calculate the fair value on our fixed-rate debt instruments at December 31, 2021 had been 1.0% lower, the fair value of those debt instruments on that date would have increased by approximately $291.7 million.
Variable Interest Rate Debt
Generally, we believe that our primary interest rate risk is due to fluctuations in interest rates on our outstanding variable rate debt. At December 31, 2021, we had $300.0 million of variable rate debt outstanding (the principal balance on our unsecured term loan). Based upon this amount of variable rate debt and the specific terms, if market interest rates increased 1.0%, our annual interest expense would increase approximately $3.0 million with a corresponding decrease in our net income and cash flows for the year. Conversely, if market interest rates decreased 1.0%, our annual interest expense would decrease by approximately $3.0 million with a corresponding increase in our net income and cash flows for the year.
ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Our consolidated financial statements and supplementary data are included as a separate section of this Annual Report on Form 10-K commencing on page F-1 and are incorporated herein by reference.
ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
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ITEM 9A.    CONTROLS AND PROCEDURES
Management's Evaluation of Disclosure Controls and Procedures
The Trust maintains disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that are designed to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to the Trust’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures. Because of inherent limitations, disclosure controls and procedures, no matter how well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of disclosure controls and procedures are met.
Our management, with the participation of the Trust’s Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of the Trust’s disclosure controls and procedures as of December 31, 2021. Based on that evaluation, the Trust’s Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2021, the Trust’s disclosure controls and procedures were effective at a reasonable assurance level.
Management's Evaluation of Internal Control over Financial Reporting
The Trust’s management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, the Trust’s principal executive and principal financial officers and effected by our Board of Trustees, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America (GAAP) and includes those policies and procedures that:
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and disposition of our assets;
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorization of management and our Trustees; and
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of any of our assets in circumstances that could have a material adverse effect on our financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
We assessed the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2021. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013). Based on that assessment and criteria, management concluded that the Trust's internal control over financial reporting was effective as of December 31, 2021.
Grant Thornton LLP, the independent registered public accounting firm that audited the Trust's consolidated financial statements included in this Annual Report on Form 10-K, has issued an attestation report on the Trust's internal control over financial reporting, which appears on page F-2 of this Annual Report on Form 10-K.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting during our fourth fiscal quarter of 2021 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B.    OTHER INFORMATION
None.

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PART III
Certain information required in Part III is omitted from this Report but is incorporated herein by reference from our Proxy Statement for the 2022 Annual Meeting of Shareholders (as amended or supplemented, the “Proxy Statement”).
ITEM 10.    TRUSTEES, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The tables and narrative in the Proxy Statement identifying our Trustees and Board committees under the caption “Election of Trustees” and “Corporate Governance”, the sections of the Proxy Statement entitled “Executive Officers” and “Section 16(a) Beneficial Ownership Reporting Compliance” and other information included in the Proxy Statement required by this Item 10 are incorporated herein by reference.
We have adopted a Code of Ethics, which is applicable to our Chief Executive Officer and senior financial officers. The Code of Ethics is available in the Corporate Governance section of the Investors section of our website at www.federalrealty.com.
ITEM 11.    EXECUTIVE COMPENSATION
The sections of the Proxy Statement entitled “Summary Compensation Table,” “Compensation Committee Interlocks and Insider Participation,” “Compensation Committee Report,” “Trustee Compensation” and “Compensation Discussion and Analysis” and other information included in the Proxy Statement required by this Item 11 are incorporated herein by reference.
ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS
The sections of the Proxy Statement entitled “Share Ownership” and “Equity Compensation Plan Information” and other information included in the Proxy Statement required by this Item 12 are incorporated herein by reference.
ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND TRUSTEE INDEPENDENCE
The sections of the Proxy Statement entitled “Certain Relationship and Related Transactions” and “Independence of Trustees” and other information included in the Proxy Statement required by this Item 13 are incorporated herein by reference.
ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES
The sections of the Proxy Statement entitled “Ratification of Independent Registered Public Accounting Firm” and “Relationship with Independent Registered Public Accounting Firm” and other information included in the Proxy Statement required by this Item 14 are incorporated herein by reference.

PART IV
ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)(1) Financial Statements
Our consolidated financial statements and notes thereto, together with Reports of Independent Registered Public Accounting Firm are included as a separate section of this Annual Report on Form 10-K commencing on page F-1.
(2) Financial Statement Schedules
Our financial statement schedules are included in a separate section of this Annual Report on Form 10-K commencing on page F-32.
(3) Exhibits
(b) The following documents are filed as exhibits are filed as part of, or incorporated by reference info, this report:

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EXHIBIT INDEX
Exhibit
No.
Description
2.1
Merger Agreement and Plan of Reorganization, dated December 2, 2021, by and among the Predecessor, the Parent Company, and Merger Sub (previously filed as Exhibit 2.1 to the Predecessor's Current Report on Form 8-K filed on December 2, 2021 and incorporated herein by reference)
Amended and Restated Declaration of Trust of the Parent Company dated January 1, 2022, as amended by the Articles of Amendment of Amended and Restated Declaration of Trust dated January 1, 2022 (filed herewith)
3.2
Amended and Restated Bylaws of the Parent Company dated January 1, 2022 (previously filed as Exhibit 3.3 to our Current Report on Form 8-K filed on January 3, 2022 and incorporated herein by reference)
3.3
Articles of Merger, dated December 8, 2021, by and among Merger Sub and the Predecessor (previously filed as Exhibit 3.4 to the Parent Company's Current Report on Form 8-K filed on January 3, 2022 and incorporated herein by reference)
3.4
Certificate of Limited Partnership of Federal Realty OP LP (previously filed as Exhibit 3.1 to our Current Report on Form 8-K filed on January 5, 2022 and incorporated herein by reference)
3.5
Agreement of Limited Partnership of Federal Realty OP LP, dated as of January 5, 2022, by and between Federal Realty GP LLC and the Parent Company (Previously filed as Exhibit 3.2 to our Current Report on Form 8-K filed on January 5, 2022 and incorporated herein by reference)
4.1
Specimen Common Share certificate (previously filed as Exhibit 4(i) to the Predecessor’s Annual Report on Form 10-K for the year ended December 31, 1999 and incorporated herein by reference)
4.2** Indenture dated December 1, 1993 related to the Partnership’s 7.48% Debentures due August 15, 2026; and 6.82% Medium Term Notes due August 1, 2027; (previously filed as Exhibit 4(a) to the Predecessor’s Registration Statement on Form S-3, and amended on Form S-3, filed on December 13, 1993 and incorporated herein by reference)***
4.3
** Indenture dated September 1, 1998 related to the Partnership’s 2.75% Notes due 2023; 3.95% Notes due 2024; 4.50% Notes due 2044; 2.55% Notes due 2021; 3.625% Notes due 2046; 3.25% Notes due 2027; 3.20% Notes due 2029; 3.50% Notes due 2030; 1.25% Notes due 2026 (previously filed as Exhibit 4(a) to the Predecessor’s Registration Statement on Form S-3 filed on September 17, 1998 and incorporated herein by reference)***
4.4
**First Supplemental Indenture, dated as of January 5, 2022, by and between Federal Realty OP LP and U.S. Bank National Association, with respect to the Partnership's Indenture dated December 1, 1993 related to the Partnership's 7.48% Debentures due August 15, 2026 and 6.82% Medium Term Notes due August 1, 2027 (previously filed as Exhibit 4.1 to our Current Report on Form 8-K filed on January 5, 2022 and incorporated herein by reference)
4.5
**First Supplemental Indenture, dated as of January 5, 2022, by and between Federal Realty OP LP and U.S. Bank National Association, with respect to the Partnership's Indenture dated September 1, 1998 related to the Partnership's 2.75% Notes due 2023; 3.95% Notes due 2024; 4.50% Notes due 2044; 2.55% Notes due 2021; 3.625% Notes due 2046; 3.25% Notes due 2027; 3.20% Notes due 2029; 3.50% Notes due 2030; 1.25% Notes due 2026 (previously filed as Exhibit 4.2 to our Current Report on Form 8-K filed on January 5, 2022 and incorporated herein by reference)
4.6
Deposit Agreement, dated as of September 29, 2017, by and among Federal Realty Investment Trust, American Stock Transfer and Trust Company, LLC, as Depositary, and all holders from time to time of Receipt (previously filed as Exhibit 4.1 to the Predecessor's Registration Statement on Form 8-A, filed on September 29, 2017 and incorporated herein by reference)
4.7
Specimen certificate relating to the 5.000% Series C Cumulative Redeemable Preferred Shares of Beneficial Interest (previously filed as Exhibit 4.3 to the Predecessor's Registration Statement on Form 8-A, filed on September 29, 2017 and incorporated herein by reference)
4.8
Description of Securities (previously filed as Exhibit 4.8 to the Predecessor's Annual Report on Form 10-K for the year ended December 31, 2019 and incorporated here by reference)
10.1
* Severance Agreement between Federal Realty Investment Trust and Donald C. Wood dated February 22, 1999 (previously filed as a portion of Exhibit 10 to the Predecessor's Quarterly Report on Form 10-Q for the quarter ended March 31, 1999 (the "1999 1Q Form 10-Q") and incorporated herein by reference)
10.2
* Executive Agreement between Federal Realty Investment Trust and Donald C. Wood dated February 22, 1999 (previously filed as a portion of Exhibit 10 to the Predecessor's 1999 1Q Form 10-Q and incorporated herein by reference)
10.3
* Amendment to Executive Agreement between Federal Realty Investment Trust and Donald C. Wood dated February 16, 2005 (previously filed as Exhibit 10.12 to the Predecessor’s Annual Report on Form 10-K for the year ended December 31, 2004 (the “2004 Form 10-K”) and incorporated herein by reference)
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Exhibit
No.
Description
10.4
* Health Coverage Continuation Agreement between Federal Realty Investment Trust and Donald C. Wood dated February 16, 2005 (previously filed as Exhibit 10.26 to the Predecessor's 2004 Form 10-K and incorporated herein by reference)
10.5
* Severance Agreement between Federal Realty Investment Trust and Dawn M. Becker dated April 19, 2000 (previously filed as Exhibit 10.26 to the Predecessor’s 2005 2Q Form 10-Q and incorporated herein by reference)
10.6
* Amendment to Severance Agreement between Federal Realty Investment Trust and Dawn M. Becker dated February 16, 2005 (previously filed as Exhibit 10.27 to the Predecessor's 2004 Form 10-K and incorporated herein by reference)
10.7
Form of Restricted Share Award Agreement for long term vesting and retention awards for shares issued out of the 2010 Plan (previously filed as Exhibit 10.35 to the Predecessor's Annual Report on Form 10-K for the year ended December 31, 2010 (the "2010 Form 10-K") and incorporated herein by reference)
10.8
* Amendment to Severance Agreement between Federal Realty Investment Trust and Donald C. Wood dated January 1, 2009 (previously filed as Exhibit 10.26 to the Predecessor’s Annual Report on Form 10-K for the year ended December 31, 2008 (“the 2008 Form 10-K”) and incorporated herein by reference)
10.9
* Second Amendment to Executive Agreement between Federal Realty Investment Trust and Donald C. Wood dated January 1, 2009 (previously filed as Exhibit 10.27 to the Predecessor’s 2008 Form 10-K and incorporated herein by reference)
10.10
* Amendment to Health Coverage Continuation Agreement between Federal Realty Investment Trust and Donald C. Wood dated January 1, 2009 (previously filed as Exhibit 10.28 to the Predecessor’s 2008 Form 10-K and incorporated herein by reference)
10.11
* Second Amendment to Severance Agreement between Federal Realty Investment Trust and Dawn M. Becker dated January 1, 2009 (previously filed as Exhibit 10.30 to the Predecessor’s 2008 Form 10-K and incorporated herein by reference)
10.12
2010 Performance Incentive Plan (previously filed as Appendix A to the Predecessor’s Definitive Proxy Statement for the 2010 Annual Meeting of Shareholders and incorporated herein by reference)
10.13
Amendment to 2010 Performance Incentive Plan (“the 2010 Plan”) (previously filed as Appendix A to the Predecessor’s Proxy Statement for the 2010 Annual Meeting of Shareholders and incorporated herein by reference)
10.14
Form of Restricted Share Award Agreement for awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program and the Trust’s Annual Incentive Bonus Program and basic awards with annual vesting for shares issued out of the 2010 Plan (previously filed as Exhibit 10.34 to the Predecessor’s 2010 Form 10-K and incorporated herein by reference)
10.15
Form of Option Award Agreement for awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (previously filed as Exhibit 10.38 to the Predecessor’s 2010 Form 10-K and incorporated herein by reference)
10.16
Form of Option Award Agreement for front loaded awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (previously filed as Exhibit 10.39 to the Predecessor’s 2010 Form 10-K and incorporated herein by reference)
10.17
Form of Option Award Agreement for basic options awarded out of the 2010 Plan (previously filed as Exhibit 10.40 to the Predecessor’s 2010 Form 10-K and incorporated herein by reference)
10.18
Credit Agreement dated as of July 7, 2011, by and among the Predecessor, as Borrower, the financial institutions party thereto and their permitted assignees under Section 12.6., as Lenders, Wells Fargo Bank, National Association, as Administrative Agent, PNC Bank, National Association, as Syndication Agent, Wells Fargo Securities, LLC, as a Lead Arranger and Book Manager, and PNC Capital Markets LLC, as a Lead Arranger and Book Manager (previously filed as Exhibit 10.1 to the Trust’s Current Report on Form 8-K, filed on July 11, 2011 and incorporated herein by reference)***
10.19
Revised Form of Restricted Share Award Agreement for front loaded awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (previously filed as Exhibit 10.35 to the Predecessor's Annual Report on Form 10-K for the year ended December 31, 2012 (the "2012 Form 10-K") and incorporated herein by reference)
10.20
Revised Form of Restricted Share Award Agreement for long-term vesting and retention awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2010 Plan (previously filed as Exhibit 10.36 to the Predecessor's 2012 Form 10-K and incorporated herein by reference)
10.21
Revised Form of Performance Share Award Agreement for shares awarded out of the 2010 Plan (previously filed as Exhibit 10.37 to the Predecessor's 2012 Form 10-K and incorporated herein by reference)
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Exhibit
No.
Description
10.22
Revised Form of Restricted Share Award Agreement for awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program and the Trust’s Annual Incentive Bonus Program and basic awards with annual vesting for shares issued out of the 2010 Plan (previously filed as Exhibit 10.38 to the Predecessor's 2012 Form 10-K and incorporated herein by reference)
10.23
First Amendment to the Credit Agreement, dated as of April 22, 2013, by and among the Predecessor, each of the Lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent (previously filed as Exhibit 10.1 to the Predecessor's Current Report on Form 8-K, filed on April 26, 2013 and incorporated herein by reference)***
10.24
First Amendment to the Credit Agreement, dated as of April 22, 2013, by and among the Predecessor, each of the Lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent (previously filed as Exhibit 10.1 to the Predecessor's Current Report on Form 8-K, filed on April 26, 2013 and incorporated herein by reference)***
10.25
Second Amendment to Credit Agreement, dated as of April 20, 2016, by and among the Predecessor, each of the Lenders party thereto, and PNC Bank, National Association, as Administrative Agent (previously filed as Exhibit 10.1 to the Predecessor's Current Report on Form 8-K, filed on April 26, 2016 and incorporated herein by reference)***
10.26
Severance Agreement between Federal Realty Investment Trust and Daniel Guglielmone dated August 15, 2016 (previously filed as Exhibit 10.36 to the Predecessor's Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 and incorporated herein by reference)
10.27
Amended and Restated Credit Agreement, dated as of July 25, 2019, by and among the Predecessor, each of the Lenders party thereto, and PNC Bank, National Association, as Administrative Agent (previously filed as Exhibit 10.1 to the Predecessor's Current Report on Form 8-K, filed on July 29, 2019 and incorporated herein by reference)***
10.28
2020 Performance Incentive Plan (previously filed as Appendix B to the Predecessor’s Definitive Proxy Statement for the 2020 Annual Meeting of Shareholders and incorporated herein by reference)
10.29
Term Loan Agreement dated as of May 6, 2020, by and among the Predecessor, as Borrower, the financial institutions party thereto and their permitted assignees under Section 12.6., as Lenders, PNC Bank, National Association, as Administrative Agent, Regions Bank, Truist Bank, and U.S. Bank National Bank Association as Co-Syndication Agents, PNC Capital Markets, LLC, Regions Capital Markets, Suntrust Robinson Humphrey, Inc., and U.S. Bank National Association, as Joint Lead Arrangers and Book Managers (previously filed as Exhibit 10.1 to the Predecessor's Current Report on Form 8-K, filed on May 6, 2020 and incorporated herein by reference)***
10.30
First Amendment to the Credit Agreement, dated as of May 6, 2020, by and among the Predecessor, each of the Lenders party thereto, and Wells Fargo Bank, National Association, as Administrative Agent (previously filed as Exhibit 10.2 to the Predecessor's Current Report on Form 8-K, filed on May 6, 2020, and incorporated herein by reference)***
10.31
Form of Restricted Share Award Agreement for awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program and the Trust’s Annual Incentive Bonus Program and basic awards with annual vesting for shares issued out of the 2020 Plan (previously filed as Exhibit 10.32 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021, and incorporated herein by reference)
10.32
Form of Option Award Agreement for awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2020 Plan (previously filed as Exhibit 10.33 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021, and incorporated herein by reference)
10.33
Form of Restricted Share Award Agreement for long-term vesting and retention awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2020 Plan (previously filed as Exhibit 10.34 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021, and incorporated herein by reference)
10.34
Form of Performance Share Award Agreement for shares awarded out of the 2020 Plan (previously filed as Exhibit 10.35 to the Predecessor's Annual Report on From 10-K, filed on February 11, 2021, and incorporated herein by reference)
10.35
Form of Option Award Agreement for basic options awarded out of the 2020 Plan (previously filed as Exhibit 10.36 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021, and incorporated herein by reference)
10.36
Form of Performance Award Agreement for Jeffrey S. Berkes, dated February 10, 2021 (previously filed as Exhibit 10.1 to the Predecessor’s Current Report on Form 8-K, filed on February 12, 2021, and incorporated herein by reference)
10.37
Amended and Restated Severance Agreement between Federal Realty Investment Trust and Jeffery S. Berkes, dated February 10, 2021 (previously filed as Exhibit 10.2 to the Predecessor's Current Report on Form 8-K, filed on February 12, 2021 and incorporated herein by reference)
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Exhibit
No.
Description
10.38
First Amendment to Term Loan Agreement, dated as of April 16, 2021, by and among the Predecessor, as borrower, the Lenders, New Lenders, Departing Lenders (as each such term is defined therein) and PNC Bank, National Association, as Administrative Agent (previously filed as Exhibit 10.1 to the Predecessor's Current Report on From 8-K, filed on April 19, 2021, and incorporated herein by reference)***
10.39
Omnibus Assignment, Assumption and Amendment entered into between the Predecessor and the Parent Company (previously filed as Exhibit 10.1 to our Current Report on Form 8-K, filed on January 3, 2022 and incorporated herein by reference)
10.40
Second Amendment to Amended and Restated Credit Agreement and Consent, dated as of January 1, 2022, by and among the Predecessor, as borrower, each of the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent (previously filed as Exhibit 10.2 to the Trust’s Current Report on Form 8-K filed on January 3, 2022 and incorporated herein by reference)***
10.41
Second Amendment to Term Loan Agreement and Consent, dated as of January 1, 2022, by and among the Predecessor, as borrower, each of the lenders party thereto and PNC Bank, National Association, as administrative agent (previously filed as Exhibit 10.3 to the Trust’s Current Report on Form 8-K filed on January 3, 2022 and incorporated herein by reference)***
21.1
23.1
31.1
31.2
31.3
31.4
32.1
32.2
32.3
32.4
101The following materials from this Annual Report on Form 10-K for the year ended December 31, 2021, formatted in XBRL (Extensible Business Reporting Language): (1) the Consolidated Balance Sheets, (2) the Consolidated Statements of Comprehensive Income, (3) the Consolidated Statement of Shareholders’ Equity, (4) the Consolidated Statements of Cash Flows, and (5) Notes to Consolidated Financial Statements that have been detail tagged.
104Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)
_____________________
* Management contract or compensatory plan required to be filed as an exhibit pursuant to Item 15(b) of Form 10-K.
** Pursuant to Regulation S-K Item 601(b)(4)(iii), the Trust and the Partnership by this filing agrees, upon request, to furnish to the Securities and Exchange Commission a copy of other instruments defining the rights of holders of long-term debt of the Trust and the Partnership.
***Upon completion of the UPREIT reorganization described in the Explanatory Note at the beginning of this Annual Report, the Partnership became the successor to Federal Realty Investment Trust's rights and obligations under this instrument.
ITEM 16.    FORM 10-K SUMMARY
None.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized this February 10, 2022.
 
Federal Realty Investment Trust
Federal Realty OP LP
By:
/S/    DONALD C. WOOD        
Donald C. Wood
Chief Executive Officer and Trustee
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant and in the capacity and on the dates indicated. Each person whose signature appears below hereby constitutes and appoints each of Donald C. Wood and Dawn M. Becker as his or her attorney-in-fact and agent, with full power of substitution and resubstitution for him or her in any and all capacities, to sign any or all amendments to this Report and to file same, with exhibits thereto and other documents in connection therewith, granting unto such attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that such attorney-in-fact and agent or his or her substitutes may do or cause to be done by virtue hereof.
 
Signature  Title Date
/S/    DONALD C. WOOD
  Chief Executive Officer and Trustee February 10, 2022
Donald C. Wood(Principal Executive Officer)
/S/    DANIEL GUGLIELMONE
  Executive Vice President - Chief Financial  February 10, 2022
Daniel GuglielmoneOfficer and Treasurer (Principal
Financial and Accounting Officer)
/S/    DAVID W. FAEDER
  Non -Executive Chairman February 10, 2022
David W. Faeder
/S/    ELIZABETH I. HOLLAND
TrusteeFebruary 10, 2022
Elizabeth I. Holland
/S/    NICOLE Y. LAMB-HALE
TrusteeFebruary 10, 2022
Nicole Y. Lamb-Hale
/S/    ANTHONY P. NADER, III
TrusteeFebruary 10, 2022
Anthony P. Nader, III
/S/    MARK S. ORDAN
TrusteeFebruary 10, 2022
Mark S. Ordan 
/S/    GAIL P. STEINEL
  Trustee February 10, 2022
Gail P. Steinel


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Item 8 and Item 15(a)(1) and (2)
Index to Consolidated Financial Statements and Schedules
 
Consolidated Financial StatementsPage No.
Report of Independent Registered Public Accounting Firm ( PCAOB ID Number 248)
F-2
Report of Independent Registered Public Accounting Firm ( PCAOB ID Number 248)
F-3
Consolidated Balance Sheets
F-5
Consolidated Statements of Comprehensive Income
F-6
Consolidated Statement of Shareholders’ Equity
F-7
Consolidated Statements of Cash Flows
F-8
Notes to Consolidated Financial Statements
F-9
Financial Statement Schedules
Schedule III—Summary of Real Estate and Accumulated Depreciation
F-32
Schedule IV—Mortgage Loans on Real Estate
F-40
All other schedules have been omitted either because the information is not applicable, not material, or is disclosed in our consolidated financial statements and related notes.

F-1

Table of Contents
Report of Independent Registered Public Accounting Firm

Trustees and Shareholders
Federal Realty Investment Trust

Opinion on internal control over financial reporting
We have audited the internal control over financial reporting of Federal Realty Investment Trust (a Maryland real estate investment trust) and subsidiaries (collectively, the "Trust") as of December 31, 2021, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). In our opinion, the Trust maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on criteria established in the 2013 Internal Control-Integrated Framework issued by COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated financial statements of the Trust as of and for the year ended December 31, 2021, and our report dated February 10, 2022 expressed an unqualified opinion on those financial statements.

Basis for opinion
The Trust’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Evaluation of Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Trust’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and limitations of internal control over financial reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ GRANT THORNTON LLP
New York, New York
February 10, 2022


F-2

Table of Contents
Report of Independent Registered Public Accounting Firm

Trustees and Shareholders
Federal Realty Investment Trust

Opinion on the financial statements
We have audited the accompanying consolidated balance sheets of Federal Realty Investment Trust (a Maryland real estate investment trust) and subsidiaries (collectively, the "Trust") as of December 31, 2021 and 2020, the related consolidated statements of comprehensive income, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and financial statement schedules included under Item 15(a)(2) (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Trust’s internal control over financial reporting as of December 31, 2021, based on criteria established in the 2013 Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), and our report dated February 10, 2022 expressed an unqualified opinion.

Basis for opinion
These financial statements are the responsibility of the Trust’s management. Our responsibility is to express an opinion on the Trust’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical audit matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Lease Collectibility Assessment
In order to recognize rental revenue on an accrual basis, the Trust must determine whether substantially all the rents due under a lease arrangement are collectible. If the Trust reaches the conclusion that substantially all of the rents are not collectible for a specific lease, then rental revenue under that arrangement can only be recognized when cash payment from the tenant is received.

Significant judgment is exercised by the Trust when making a collectibility assessment and includes the following considerations which require challenging and subjective auditor judgment in the execution of our audit procedures:
Creditworthiness of the tenant
Current economic conditions
Historical experience with the tenant and other tenants operating in the same industry

Our audit procedures related to the collectibility assessment included the following:
We assessed the design and tested the operating effectiveness of internal controls relating to the collectibility assessment process.
F-3

Table of Contents
We evaluated management’s accounting policies related to this assessment.
We verified the completeness of the population of tenants that management evaluated.
We researched recent publicly available information such as bankruptcy filings, industry journals, and periodicals, and for any of the Trust’s tenants identified in our research, we evaluated whether such information was considered in management’s collectibility assessment.
For a selection of tenant receivables where collectibility was deemed as probable, we inspected and evaluated management’s documentation supporting the collectibility assessment.
We recalculated the aging for a selection of tenant receivable balances using supporting documentation.
For a selection of leases, we evaluated the collectibility assessment conclusion reached by management and performed the following procedures for each selection:
Verified that management’s accounting policies related to the collectibility assessment were followed.
Obtained from management documentation such as tenant collection history and any direct correspondence and evaluated management’s considerations supporting the collectibility assessment conclusion reached.
Researched publicly available information to independently verify the completeness and accuracy of management’s information used to make the collectibility assessment.

/s/ GRANT THORNTON LLP

We have served as the Trust’s auditor since 2002.
New York, New York
February 10, 2022


F-4

Table of Contents
Federal Realty Investment Trust
Consolidated Balance Sheets
December 31,
20212020
 (In thousands, except share and per share data)
ASSETS
Real estate, at cost
Operating (including $2,207,648 and $1,703,202 of consolidated variable interest entities, respectively)$8,814,791 $7,771,981 
Construction-in-progress (including $18,752 and $44,896 of consolidated variable interest entities, respectively)607,271 810,889 
9,422,062 8,582,870 
Less accumulated depreciation and amortization (including $389,950 and $335,735 of consolidated variable interest entities, respectively)(2,531,095)(2,357,692)
Net real estate6,890,967 6,225,178 
Cash and cash equivalents162,132 798,329 
Accounts and notes receivable169,007 159,780 
Mortgage notes receivable, net9,543 39,892 
Investment in partnerships13,027 22,128 
Operating lease right of use assets90,743 92,248 
Finance lease right of use assets49,832 51,116 
Prepaid expenses and other assets237,069 218,953 
TOTAL ASSETS$7,622,320 $7,607,624 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Mortgages payable, net (including $335,301 and $413,681 of consolidated variable interest entities, respectively)$339,993 $484,111 
Notes payable, net301,466 402,776 
Senior notes and debentures, net3,406,088 3,404,488 
Accounts payable and accrued expenses235,168 228,641 
Dividends payable86,538 83,839 
Security deposits payable25,331 20,388 
Operating lease liabilities72,661 72,441 
Finance lease liabilities72,032 72,049 
Other liabilities and deferred credits206,187 152,424 
Total liabilities4,745,464 4,921,157 
Commitments and contingencies (Note 7)
Redeemable noncontrolling interests213,708 137,720 
Shareholders’ equity
Preferred shares, authorized 15,000,000 shares, $.01 par:
5.0% Series C Cumulative Redeemable Preferred Shares, (stated at liquidation preference $25,000 per share), 6,000 shares issued and outstanding150,000 150,000 
5.417% Series 1 Cumulative Convertible Preferred Shares, (stated at liquidation preference $25 per share), 399,896 shares issued and outstanding9,997 9,997 
Common shares of beneficial interest, $.01 par, 100,000,000 shares authorized, 78,603,305 and 76,727,394 shares issued and outstanding, respectively790 771 
Additional paid-in capital3,488,794 3,297,305 
Accumulated dividends in excess of net income(1,066,932)(988,272)
Accumulated other comprehensive loss(2,047)(5,644)
Total shareholders’ equity of the Trust2,580,602 2,464,157 
Noncontrolling interests82,546 84,590 
Total shareholders’ equity2,663,148 2,548,747 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$7,622,320 $7,607,624 
The accompanying notes are an integral part of these consolidated statements.
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Federal Realty Investment Trust
Consolidated Statements of Comprehensive Income
Year Ended December 31,
 202120202019
 (In thousands, except per share data)
REVENUE
Rental income$948,842 $832,171 $932,738 
Mortgage interest income2,382 3,323 3,050 
Total revenue951,224 835,494 935,788 
EXPENSES
Rental expenses198,121 170,920 187,831 
Real estate taxes118,496 119,242 110,927 
General and administrative49,856 41,680 42,754 
Depreciation and amortization279,976 255,027 239,758 
Total operating expenses646,449 586,869 581,270 
Impairment charge— (57,218)— 
Gain on sale of real estate and change in control of interest, net of tax89,950 98,117 116,393 
OPERATING INCOME394,725 289,524 470,911 
OTHER INCOME/(EXPENSE)
Other interest income809 1,894 1,266 
Interest expense(127,698)(136,289)(109,623)
Early extinguishment of debt— (11,179)— 
Income (loss) from partnerships1,245 (8,062)(2,012)
NET INCOME269,081 135,888 360,542 
Net income attributable to noncontrolling interests(7,583)(4,182)(6,676)
NET INCOME ATTRIBUTABLE TO THE TRUST261,498 131,706 353,866 
Dividends on preferred shares(8,042)(8,042)(8,042)
NET INCOME AVAILABLE FOR COMMON SHAREHOLDERS$253,456 $123,664 $345,824 
EARNINGS PER COMMON SHARE, BASIC
Net income available for common shareholders$3.26 $1.62 $4.61 
Weighted average number of common shares77,336 75,515 74,766 
EARNINGS PER COMMON SHARE, DILUTED
Net income available for common shareholders$3.26 $1.62 $4.61 
Weighted average number of common shares77,368 75,515 74,766 
NET INCOME$269,081 $135,888 $360,542 
Other comprehensive income (loss) - change in value of interest rate swaps3,917 (5,302)(397)
COMPREHENSIVE INCOME272,998 130,586 360,145 
Comprehensive income attributable to noncontrolling interests(7,903)(3,711)(6,676)
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE TRUST$265,095 $126,875 $353,469 

The accompanying notes are an integral part of these consolidated statements.
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Federal Realty Investment Trust
Consolidated Statement of Shareholders’ Equity
 Shareholders’ Equity of the Trust  
 Preferred SharesCommon SharesAdditional
Paid-in
Capital
Accumulated
Dividends in
Excess of Net
Income
Accumulated
Other
Comprehensive
Loss
Noncontrolling InterestsTotal Shareholders' Equity
 SharesAmountSharesAmount
 (In thousands, except share data)
BALANCE AT DECEMBER 31, 2018405,896 $159,997 74,249,633 $745 $3,004,442 $(818,877)$(416)$121,439 $2,467,330 
January 1, 2019 adoption of new accounting standard— — — — — (7,098)— — (7,098)
Net income, excluding $3,430 attributable to redeemable noncontrolling interests— — — — — 353,866 — 3,246 357,112 
Other comprehensive loss - change in value of interest rate swaps— — — — — — (397)— (397)
Dividends declared to common shareholders ($4.14 per share)— — — — — (310,973)— — (310,973)
Dividends declared to preferred shareholders— — — — — (8,042)— — (8,042)
Distributions declared to noncontrolling interests, excluding $4,094 attributable to redeemable noncontrolling interests— — — — — — — (9,961)(9,961)
Common shares issued, net— — 1,069,740 11 142,705 — — — 142,716 
Shares issued under dividend reinvestment plan— — 15,909 — 2,095 — — — 2,095 
Share-based compensation expense, net of forfeitures— — 111,555 13,329 — — — 13,330 
Shares withheld for employee taxes— — (34,320)— (4,626)— — — (4,626)
Conversion and redemption of OP units— — 128,287 14,102 — — (14,176)(72)
Contributions from noncontrolling interests, excluding $9,961 attributable to redeemable noncontrolling interests— — — — — — — 243 243 
Adjustment to redeemable noncontrolling interests— — — — (5,525)— — — (5,525)
BALANCE AT DECEMBER 31, 2019405,896 $159,997 75,540,804 $759 $3,166,522 $(791,124)$(813)$100,791 $2,636,132 
January 1, 2020 adoption of new accounting standard - See Note 2— — — — — (510)— — (510)
Net income, excluding $2,228 attributable to redeemable noncontrolling interests— — — — — 131,706 — 1,954 133,660 
Other comprehensive loss - change in value of interest rate swaps, excluding $471 attributable to redeemable noncontrolling interest— — — — — — (4,831)— (4,831)
Dividends declared to common shareholders ($4.22 per share)— — — — — (320,302)— — (320,302)
Dividends declared to preferred shareholders— — — — — (8,042)— — (8,042)
Distributions declared to noncontrolling interests, excluding $1,197 attributable to redeemable noncontrolling interests— — — — — — — (8,874)(8,874)
Common shares issued, net— — 1,080,882 11 98,828 — — — 98,839 
Shares issued under dividend reinvestment plan— — 24,491 — 2,072 — — — 2,072 
Share-based compensation expense, net of forfeitures— — 114,251 13,242 — — — 13,243 
Shares withheld for employee taxes— — (33,034)— (4,052)— — — (4,052)
Conversion and redemption of OP units— — — — (30)— — (3,290)(3,320)
Contributions from noncontrolling interests, excluding $19,335 attributable to redeemable noncontrolling interests— — — — — — — 120 120 
Purchase of noncontrolling interests— — — — (1,210)— — (6,111)(7,321)
Adjustment to redeemable noncontrolling interests— — — — 21,933 — — — 21,933 
BALANCE AT DECEMBER 31, 2020405,896 $159,997 76,727,394 $771 $3,297,305 $(988,272)$(5,644)$84,590 $2,548,747 
Net income, excluding $4,296 attributable to redeemable noncontrolling interests— — — — — 261,498 — 3,287 264,785 
Other comprehensive income - change in value of interest rate swaps, excluding $320 attributable to redeemable noncontrolling interest— — — — — — 3,597 — 3,597 
Dividends declared to common shareholders ($4.26 per share)— — — — — (332,116)— — (332,116)
Dividends declared to preferred shareholders— — — — — (8,042)— — (8,042)
Distributions declared to noncontrolling interests, excluding $5,268 attributable to redeemable noncontrolling interests— — — — — — — (4,341)(4,341)
Common shares issued, net— — 1,643,845 17 172,736 — — — 172,753 
Shares issued under dividend reinvestment plan— — 19,758 — 1,955 — — — 1,955 
Share-based compensation expense, net of forfeitures— — 164,553 14,432 — — — 14,434 
Shares withheld for employee taxes— — (29,031)— (2,998)— — — (2,998)
Conversion and redemption of OP units— — 76,786 — 7,474 — — (7,573)(99)
Contributions from noncontrolling interests, excluding $74,530 attributable to redeemable noncontrolling interests— — — — — — — 6,583 6,583 
Adjustment to redeemable noncontrolling interests— — — — (2,110)— — — (2,110)
BALANCE AT DECEMBER 31, 2021405,896 $159,997 78,603,305 $790 $3,488,794 $(1,066,932)$(2,047)$82,546 $2,663,148 
The accompanying notes are an integral part of these consolidated statements.
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Federal Realty Investment Trust
Consolidated Statements of Cash Flows
 
Year Ended December 31,
 202120202019
 (In thousands)
OPERATING ACTIVITIES
Net income$269,081 $135,888 $360,542 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization279,976 255,027 239,758 
Impairment charge— 57,218 — 
Gain on sale of real estate and change in control of interest, net of tax(89,950)(98,117)(116,393)
Early extinguishment of debt— 11,179 — 
(Income) loss from partnerships(1,245)8,062 2,012 
Other, net389 6,142 169 
Changes in assets and liabilities, net of effects of acquisitions and dispositions:
Decrease (increase) in accounts receivable, net1,214 (6,032)(16,128)
Increase in prepaid expenses and other assets(5,607)(3,260)(10,253)
Increase in accounts payable and accrued expenses6,782 5,621 2,327 
Increase (decrease) in security deposits and other liabilities10,712 (1,799)(115)
Net cash provided by operating activities471,352 369,929 461,919 
INVESTING ACTIVITIES
Acquisition of real estate(366,466)(9,589)(204,516)
Capital expenditures - development and redevelopment(368,786)(433,872)(327,074)
Capital expenditures - other(71,728)(68,064)(82,836)
Costs associated with property sold under threat of condemnation, net— (12,924)— 
Proceeds from sale of real estate137,868 183,461 321,997 
Investment in partnerships(3,115)(3,348)(1,052)
Distribution from partnerships in excess of earnings2,970 1,301 2,765 
Leasing costs(21,990)(15,080)(25,459)
Repayment (issuance) of mortgage and other notes receivable, net31,129 (10,268)(357)
Net cash used in investing activities(660,118)(368,383)(316,532)
FINANCING ACTIVITIES
Costs to amend revolving credit facility— (638)(4,012)
Issuance of senior notes, net of costs— 1,094,283 399,913 
Redemption and retirement of senior notes— (510,360)— 
Issuance of notes payable, net of costs— 398,722 — 
Repayment of mortgages, finance leases, and notes payable(277,643)(70,237)(301,029)
Issuance of common shares, net of costs172,981 99,177 143,027 
Dividends paid to common and preferred shareholders(335,656)(324,596)(313,649)
Shares withheld for employee taxes(2,998)(4,052)(4,626)
Contributions from noncontrolling interests133 — 404 
Distributions to and redemptions of noncontrolling interests(9,784)(20,563)(20,133)
Net cash (used in) provided by financing activities(452,967)661,736 (100,105)
(Decrease) increase in cash, cash equivalents, and restricted cash(641,733)663,282 45,282 
Cash, cash equivalents, and restricted cash at beginning of year816,896 153,614 108,332 
Cash, cash equivalents, and restricted cash at end of year$175,163 $816,896 $153,614 

The accompanying notes are an integral part of these consolidated statements.
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Federal Realty Investment Trust
Notes to Consolidated Financial Statements
December 31, 2021, 2020 and 2019

NOTE 1—BUSINESS AND ORGANIZATION
Federal Realty Investment Trust (the “Trust”) is an equity real estate investment trust (“REIT”) specializing in the ownership, management, and redevelopment of retail and mixed-use properties. Our properties are located primarily in communities where we believe retail demand exceeds supply, in strategically selected metropolitan markets in the Mid-Atlantic and Northeast regions of the United States, California, and South Florida. As of December 31, 2021, we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 104 predominantly retail real estate projects.
We operate in a manner intended to enable us to qualify as a REIT for federal income tax purposes. A REIT that distributes at least 90% of its taxable income to its shareholders each year and meets certain other conditions is not taxed on that portion of its taxable income which is distributed to its shareholders.
See Note 15 for a discussion of the UPREIT reorganization we completed in January of 2022.
Impacts of COVID-19 Pandemic
In March 2020, the World Health Organization declared the outbreak of the novel coronavirus disease ("COVID-19") as a pandemic. While we continue to expect the impact to our properties will be temporary in nature, the extent of the future effects of COVID-19 on our business, results of operations, cash flows, and growth prospects is highly uncertain and will ultimately depend on future developments, none of which can be predicted with any certainty.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
Our consolidated financial statements include the accounts of the Trust, its corporate subsidiaries, and all entities in which the Trust has a controlling interest or has been determined to be the primary beneficiary of a variable interest entity (“VIE”). The equity interests of other investors are reflected as noncontrolling interests or redeemable noncontrolling interests. All significant intercompany transactions and balances are eliminated in consolidation. We account for our interests in joint ventures, which we do not control, using the equity method of accounting.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, referred to as “GAAP,” requires management to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using management’s best judgment, after considering past, current and expected events and economic conditions. Actual results could differ from these estimates.
Revenue Recognition and Accounts Receivable
Our leases with our tenants are classified as operating leases. When collection of substantially all lease payments during the lease term is considered probable, the lease qualifies for accrual accounting. Lease payments are recognized on a straight-line basis from the point in time when the tenant controls the space through the term of the related lease. Variable lease payments relating to percentage rent are recognized at the end of the lease year or earlier if we have determined the required sales level is achieved. Real estate tax and other cost reimbursements are recognized on an accrual basis over the periods in which the related expenditures are incurred. Many of our leases contain tenant options that enable the tenant to extend the term of the lease at expiration at pre-established rental rates that often include fixed rent increases, consumer price index adjustments or other market rate adjustments from the prior base rent. For a tenant to terminate its lease agreement prior to the end of the agreed term, we may require that they pay a fee to cancel the lease agreement. Lease termination fees are generally recognized on the termination date if the tenant has relinquished control of the space. When a lease is terminated early but the tenant continues to control the space under a modified lease agreement, the lease termination fee is generally recognized evenly over the remaining term of the modified lease agreement. Lease concessions (unrelated to the COVID-19 pandemic) are evaluated to determine whether the concession represents a modification of the original lease contract. Modifications generally result in a reassessment of the lease term and lease classification, and remeasurement of lease payments received. Remeasured lease payments are recognized on a straight-line basis over the remaining term of the modified lease contract.
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In April 2020, the Financial Accounting Standards Board ("FASB") issued interpretive guidance relating to the accounting for lease concessions provided as a result of the COVID-19 pandemic that allows entities to treat the concession as if it was a part of the existing contract instead of applying lease modification accounting. This guidance is only applicable to the COVID-19 pandemic related lease concessions that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee. We have elected this option relating to qualifying rent deferral and rent abatement agreements. For qualifying lease modifications with rent deferrals, this results in no change to our revenue recognition but an increase in the lease receivable balance until the deferred rent has been repaid. For qualifying lease modifications that include rent abatement concessions, this results in a direct reduction of rental income in the current period. As of December 31, 2021, we executed rent deferral agreements related to the COVID-19 pandemic representing approximately $46 million of rent. We have subsequently collected approximately $27 million of those amounts previously deferred. As of December 31, 2021, we have entered into rent abatement agreements related to the COVID-19 pandemic totaling $26 million and $48 million of rents due in 2021 and 2020, respectively.
When collection of substantially all lease payments during the lease term is not considered probable, total lease revenue is limited to the lesser of revenue recognized under accrual accounting or cash received. Determining the probability of collection of substantially all lease payments during a lease term requires significant judgment. This determination is impacted by numerous factors including our assessment of the tenant’s credit worthiness, economic conditions, tenant sales productivity in that location, historical experience with the tenant and tenants operating in the same industry, future prospects for the tenant and the industry in which it operates, and the length of the lease term. If leases currently classified as probable are subsequently reclassified as not probable, any outstanding lease receivables (including straight-line rent receivables) would be written-off with a corresponding decrease in rental income. If leases currently classified as not probable are subsequently changed to probable, any lease receivables (including straight-line rent receivables) are re-instated with a corresponding increase to rental income.
Since March 2020, federal, state, and local governments have taken various actions to mitigate the spread of COVID-19. These actions included the closure of nonessential businesses and ordering residents to generally stay at home at the onset of the pandemic, phased re-openings and capacity limitations, and now generally lifted restrictions. While the overall economy is showing signs of recovery from the initial impacts of COVID-19, workforce shortages, global supply chain bottlenecks and shortages, inflation, as well as COVID-19 variants are impacting the recovery. Closures and restrictions, along with the general concern over the spread of COVID-19, required a significant number of tenants to close their operations or to significantly limit the amount of business they were able to conduct, which impacted their ability to timely pay rent as required under our leases and also caused many tenants to close their business permanently. As a result, we revised our collectibility assumptions for many of our tenants most significantly impacted by COVID-19. Accordingly, during the years ended December 31, 2021 and 2020, we recognized collectibility related adjustments of $24.0 million and $106.6 million, respectively. This includes changes in our collectibility assessments from probable to not probable, disputed rents, and any rent abatements directly related to COVID-19, as well as the write-off of $0.7 million and $12.7 million, respectively of straight-line rent receivables related to tenants changed to a cash basis of revenue recognition during the years ended December 31, 2021 and 2020. As of December 31, 2021 and 2020, the revenue from approximately 34% and 35% of our tenants (based on total commercial leases), respectively, is being recognized on a cash basis. As of December 31, 2021 and 2020, our straight-line rent receivables balance was $110.7 million and $103.3 million, respectively, and is included in "accounts and notes receivable, net" on our consolidated balance sheet.
Other revenue recognition policies
Sales of real estate are recognized generally upon the transfer of control, which usually occurs when the real estate is legally sold. When we enter into a transaction to sell a property or a portion of a property, we evaluate the recognition of the sale under ASC 610-20, "Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets." In accordance with ASC 610-20, we apply the guidance in ASC 606, "Revenue from Contracts with Customers," to determine whether and when control transfers and how to measure the associated gain or loss. We determine the transaction price based on the consideration we expect to receive. Variable consideration is included in the transaction price to the extent it is probable that a significant reversal of a gain recognized will not occur. We analyze the risk of a significant gain reversal and if necessary limit the amount of variable consideration recognized in order to mitigate this risk. The estimation of variable consideration requires us to make assumptions and apply significant judgment.
Real Estate
Land, buildings and improvements are recorded at cost. Depreciation is computed using the straight-line method. Estimated useful lives range generally from 35 years to a maximum of 50 years on buildings and major improvements. Minor improvements, furniture and equipment are capitalized and depreciated over useful lives ranging from 2 to 20 years. Maintenance and repairs that do not improve or extend the useful lives of the related assets are charged to operations as
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incurred. Tenant improvements are capitalized and depreciated over the life of the related lease or their estimated useful life, whichever is shorter. If a tenant vacates its space prior to contractual termination of its lease, the undepreciated balance of any tenant improvements are written off if they are replaced or have no future value. In 2021, 2020 and 2019, real estate depreciation expense was $245.1 million, $227.9 million and $215.4 million, respectively, including amounts from real estate sold.
Our methodology of allocating the cost of acquisitions to assets acquired and liabilities assumed is based on estimated fair values, replacement cost and/or appraised values. When we acquire operating real estate properties, the purchase price is allocated to land, building, improvements, leasing costs, intangibles such as acquired leases, assumed debt, if any, and to current assets and liabilities acquired, if any. The value allocated to acquired leases is amortized over the related lease term and reflected as rental income in the consolidated statements of comprehensive income. We consider qualitative and quantitative factors in evaluating the likelihood of a tenant exercising a below market renewal option and include such renewal options in the calculation of acquired lease value when we consider these to be bargain renewal options. If the value of below market lease intangibles includes renewal option periods, we include such renewal periods in the amortization period utilized. If a tenant vacates its space prior to contractual termination of its lease, the unamortized balance of any acquired lease value is written off to rental income.
Transaction costs related to asset acquisitions, such as broker fees, transfer taxes, legal, accounting, valuation, and other professional and consulting fees, are capitalized as part of the acquisition cost. The acquisition of an operating shopping center typically qualifies as an asset acquisition.
Prior to the adoption of ASU 2016-02, "Leases," when applicable, as lessee, we classified our leases of land and building as operating or capital leases. We were required to use judgment and make estimates in determining the lease term, the estimated economic life of the property and the interest rate to be used in determining whether or not the lease meets the qualification of a capital lease. Subsequently, capital leases are now considered "finance leases."
We capitalize certain costs related to the development and redevelopment of real estate including pre-construction costs, real estate taxes, insurance, construction costs and salaries and related costs of personnel directly involved, are capitalized. Additionally, we capitalize interest costs related to development and redevelopment activities. Capitalization of these costs begin when the activities and related expenditures commence and cease when the project is substantially complete and ready for its intended use at which time the project is placed in service and depreciation commences. Additionally, we make estimates as to the probability of certain development and redevelopment projects being completed. If we determine the development or redevelopment is no longer probable of completion, we expense all capitalized costs which are not recoverable.
Long-Lived Assets and Impairment
There are estimates and assumptions made by management in preparing the consolidated financial statements for which the actual results will be determined over long periods of time. This includes the recoverability of long-lived assets, including our properties that have been acquired or redeveloped and our investment in certain joint ventures. Management’s evaluation of impairment includes review for possible indicators of impairment as well as, in certain circumstances, undiscounted and discounted cash flow analysis. Since most of our investments in real estate are wholly-owned or controlled assets which are held for use, a property with impairment indicators is first tested for impairment by comparing the undiscounted cash flows, including residual value, to the current net book value of the property. If the undiscounted cash flows are less than the net book value, the property is written down to expected fair value.
The calculation of both discounted and undiscounted cash flows requires management to make estimates of future cash flows including revenues, operating expenses, required maintenance and development expenditures, market conditions, demand for space by tenants and rental rates over long periods. Because our properties typically have a long life, the assumptions used to estimate the future recoverability of book value requires significant management judgment. Actual results could be significantly different from the estimates. These estimates have a direct impact on net income, because recording an impairment charge results in a negative adjustment to net income.
Cash and Cash Equivalents
We define cash and cash equivalents as cash on hand, demand deposits with financial institutions and short term liquid investments with an initial maturity, when purchased, under three months. Cash balances in individual banks may exceed the federally insured limit by the Federal Deposit Insurance Corporation (the “FDIC”). At December 31, 2021, we had $167.3 million in excess of the FDIC insured limit.
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Prepaid Expenses and Other Assets
Prepaid expenses and other assets consist primarily of lease costs, prepaid property taxes and acquired above market leases. Capitalized lease costs are incremental direct costs incurred which were essential to originate a successful leasing arrangement and would not have been incurred had the leasing transaction not taken place. These costs include third party commissions related to obtaining a lease. Capitalized lease costs are amortized over the initial life of the related lease which generally ranges from three to ten years. We view these lease costs as part of the up-front initial investment we made in order to generate a long-term cash inflow and therefore, we classify cash outflows related to leasing costs as an investing activity in our consolidated statements of cash flows. If a tenant vacates its space prior to the contractual termination of its lease, the unamortized balance of any previously capitalized lease costs are written off. See the "Leases" section in this note for further discussion regarding the change in accounting for lease costs.
Debt Issuance Costs
Costs related to the issuance of debt instruments are deferred and are amortized as interest expense over the estimated life of the related issue using the straight-line method which approximates the effective interest method. If a debt instrument is paid off prior to its original maturity date, the unamortized balance of debt issuance costs are written off to interest expense or, if significant, included in “early extinguishment of debt.” Debt issuance costs related to our revolving credit facility are classified as an asset and are included in "prepaid expenses and other assets" in our consolidated balance sheets. All other debt issuance costs are presented as a direct deduction from the carrying amount of the debt liability.
Derivative Instruments
We may use derivative instruments to manage exposure to variable interest rate risk. We generally enter into interest rate swaps to manage our exposure to variable interest rate risk and treasury locks to manage the risk of interest rates rising prior to the issuance of debt. We enter into derivative instruments that qualify as cash flow hedges and do not enter into derivative instruments for speculative purposes.
Interest rate swaps associated with cash flow hedges are recorded at fair value on a recurring basis. Effectiveness of cash flow hedges is assessed both at inception and on an ongoing basis. The effective portion of changes in fair value of the interest rate swaps associated with cash flow hedges is recorded in other comprehensive income (loss) which is included in accumulated other comprehensive income (loss) on the balance sheet and statement of shareholders' equity. Cash flow hedges become ineffective if critical terms of the hedging instrument and the debt instrument do not perfectly match such as notional amounts, settlement dates, reset dates, calculation period and LIBOR rate. In addition, the default risk of the counterparty is evaluated by monitoring the credit worthiness of the counterparty which includes reviewing debt ratings and financial performance. If a cash flow hedge is deemed ineffective, the ineffective portion of changes in fair value of the interest rate swaps associated with cash flow hedges is recognized in earnings in the period affected.
At December 31, 2021, we have two interest rate swap agreements that effectively fix the interest rate on a mortgage payable associated with our Hoboken property at 3.67%. Both swaps were designated and qualify for cash flow hedge accounting. As of December 31, 2021, our Assembly Row hotel joint venture is a party to two interest rate swap agreements that effectively fix the interest rate on the joint venture's mortgage debt at 5.206%. Both swaps were designated and qualify as cash flow hedges. Hedge ineffectiveness has not impacted earnings in 2021, 2020 and 2019.
Mortgage Notes Receivable
We have invested in certain mortgage loans that, because of their nature, qualify as loan receivables. At the time of investment, we did not intend for the arrangement to be anything other than a financing and did not contemplate a real estate investment. We evaluate each investment to determine whether the loan arrangement qualifies as a loan, joint venture or real estate investment and the appropriate accounting thereon. Such determination affects our balance sheet classification of these investments and the recognition of interest income derived therefrom.
Mortgage notes receivable are recorded at cost, net of any valuation adjustments. Effective January 1, 2020, (upon the adoption of ASU 2016-13, "Financial Instruments - Credit Losses," as amended and interpreted), we account for mortgage notes receivable using the "expected credit loss" model, and accordingly impairment losses are estimated and recorded for the entire life of the loan. Prior to the implementation of ASC 326, we recognized impairment losses as incurred. Interest income is accrued as earned. Mortgage notes receivable are considered past due based on the contractual terms of the note agreement. On a quarterly basis, we evaluate the collectability of each mortgage note receivable and update our expected credit loss model based on various factors which may include payment history, expected fair value of the collateral securing the loan, internal and external credit information and/or economic trends. A loan is considered impaired when it is probable that we will be unable to collect all amounts due under the existing contractual terms. When a loan is considered impaired, the amount of the loss accrual
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is calculated by comparing the carrying amount of the mortgage note receivable to the present value of expected future cash flows. As our loans are collateralized by mortgages, these loans have risk characteristics similar to the risks in owning commercial real estate.
On May 11, 2021, two of our outstanding mortgage notes receivable were repaid. Including interest, the net proceeds were $33.8 million. As a result of the transaction, our mortgage notes receivable, net of valuation allowance, decreased $30.3 million. At December 31, 2021, we had three mortgage notes receivable with an aggregate carrying amount, net of valuation adjustments of $9.5 million, and a weighted average interest rate of 10.9%.
Share Based Compensation
We grant share based compensation awards to employees and trustees typically in the form of restricted common shares, common shares, and options. We measure share based compensation expense based on the grant date fair value of the award and recognize the expense ratably over the requisite service period, which is typically the vesting period. See Note 12 for further discussion regarding our share based compensation plans and policies.
Variable Interest Entities
Certain entities that do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties or in which equity investors do not have the characteristics of a controlling financial interest qualify as VIEs. VIEs are required to be consolidated by their primary beneficiary. The primary beneficiary of a VIE has both the power to direct the activities that most significantly impact economic performance of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE.
On January 4, 2021, we acquired our partner's interest in the Pike & Rose hotel joint venture, which was previously considered a variable interest in a VIE. See Note 3 for additional details of this transaction. Our equity method investments in the Assembly Row hotel joint venture and the La Alameda shopping center and our mortgage notes receivable are considered variable interests in a VIE. As we do not control the activities that most significantly impact the economic performance of the joint ventures related to the Assembly Row hotel, the La Alameda shopping center, or the borrower entities related to our mortgage notes receivable, we are not the primary beneficiary and do not consolidate. As of December 31, 2021 and 2020, our investment in the Assembly Row hotel and La Alameda shopping center joint ventures and maximum exposure to loss was $8.9 million and $9.9 million, respectively, and $8.8 million for our Pike & Rose hotel joint venture as of December 31, 2020. As of December 31, 2021 and 2020, our investment in mortgage notes receivable and maximum exposure to loss was $9.5 million and $39.9 million, respectively.
In addition, we have 21 entities that meet the criteria of a VIE in which we hold a variable interest. For each of these entities, we control the significant operating decisions and consequently have the power to direct the activities that most significantly impact the economic performance of the entities. As we also have the obligation to absorb the majority of the losses and/or the right to receive a majority of the benefits for each of these entities, all are consolidated in our financial statements. Net real estate assets related to VIEs included in our consolidated balance sheets were approximately $1.8 billion and $1.4 billion as of December 31, 2021 and 2020, respectively, and mortgages related to VIEs included in our consolidated balance sheets were approximately $335.3 million and $413.7 million, as of December 31, 2021 and 2020, respectively.
Redeemable Noncontrolling Interests
We have certain noncontrolling interests that are redeemable for cash upon the occurrence of an event that is not solely in our control and therefore are classified outside of permanent equity. We adjust the carrying amounts of these noncontrolling interests that are currently redeemable to redemption value at the balance sheet date. Adjustments to the carrying amount to reflect changes in redemption value are recorded as adjustments to additional paid-in capital in shareholders' equity. These amounts are classified within the mezzanine section of the consolidated balance sheets.
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The following table provides a rollforward of the redeemable noncontrolling interests:
Year Ended
December 31,
20212020
(In thousands)
Beginning balance$137,720 $139,758 
Contributions74,530 19,335 
Net income4,296 2,228 
Other comprehensive income (loss) - change in value of interest rate swaps320 (471)
Distributions & redemptions(5,268)(1,197)
Change in redemption value2,110 (21,933)
Ending balance$213,708 $137,720 
Leases
We adopted ASC 842 effective January 1, 2019 under the modified retrospective approach and elected the optional transition method to apply the provisions of ASC 842 as of the adoption date, rather than the earliest period presented. We elected to apply certain adoption related practical expedients for all leases that commenced prior to the election date. These practical expedients included not reassessing whether any expired or existing contracts were or contained leases; not reassessing the lease classification for any expired or existing leases; and not reassessing initial direct costs for any existing leases. We also elected the practical expedient for lessors to combine our lease and non-lease components (primarily impacts common area maintenance recoveries).
Lessor
We recorded a charge to the opening accumulated dividends in excess of net income of $7.1 million in 2019 as a result of the adoption of ASC 842. This charge was attributable to the write off certain direct leasing costs recorded under the previous lease accounting rules for leases which had not commenced as well as the write off of unreserved receivables (including straight-line receivables) for leases where we had determined the collection of substantially all the lease payments required for the term is not probable.
Lessee
We have ground leases at 12 properties which are accounted for as operating leases. The operating lease right of use ("ROU") assets and related liabilities are shown separately on the face of our consolidated balance sheet and reflect the present value of the minimum lease payments. A key input in the calculation is the discount rate. As the rate implied in the lease agreements is not readily determinable, we utilize our incremental borrowing rate that correspond to the remaining term of the lease, our credit spread, and and adjustment to reflect the collateralized payment terms present in the lease. Our operating lease agreements may include options to extend the lease term or terminate it early. We include options to extend or terminate leases in the ROU operating lease asset and liability when it is reasonably certain we will exercise these options. Operating lease expense is recognized on a straight-line basis over the non-cancellable lease term and is included in rental expenses in our consolidated statements of operations. We elected to apply the short-term lease exemption within ASC 842, and as such we have not recorded an ROU asset or lease liability for leases with terms of less than 12 months.
Income Taxes
We operate in a manner intended to enable us to qualify as a REIT for federal income tax purposes. A REIT that distributes at least 90% of its taxable income to its shareholders each year and meets certain other conditions is not taxed on that portion of its taxable income which is distributed to its shareholders. Therefore, federal income taxes on our taxable income have been and are generally expected to be immaterial. We are obligated to pay state taxes, generally consisting of franchise or gross receipts taxes in certain states. Such state taxes also have not been material.
We have elected to treat certain of our subsidiaries as taxable REIT subsidiaries, which we refer to as a TRS. In general, a TRS may engage in any real estate business and certain non-real estate businesses, subject to certain limitations under the Internal Revenue Code of 1986, as amended (the “Code”). A TRS is subject to federal and state income taxes. Our TRS activities have not been material.
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With few exceptions, we are no longer subject to U.S. federal, state, and local tax examinations by tax authorities for years before 2017. As of December 31, 2021 and 2020, we had no material unrecognized tax benefits. While we currently have no material unrecognized tax benefits, as a policy, we recognize penalties and interest accrued related to unrecognized tax benefits as income tax expense.
Segment Information
Our primary business is the ownership, management, and redevelopment of retail and mixed-use properties. We review operating and financial information for each property on an individual basis and therefore, each property represents an individual operating segment. We evaluate financial performance using property operating income, which consists of rental income, and mortgage interest income, less rental expenses and real estate taxes. No individual commercial or residential property constitutes more than 10% of our revenues or property operating income and we have no operations outside of the United States of America. Therefore, we have aggregated our properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities including the fact that they are operated using consistent business strategies, are typically located in major metropolitan areas, and have similar tenant mixes.
Forward Equity Sales
On February 24, 2021, we replaced our existing at-the-market (“ATM”) equity program with a new ATM equity program in which we may from time to time offer and sell common shares having an aggregate offering price of up to $500.0 million. The new ATM equity program also allows shares to be sold through forward sales contracts. Our forward sales contracts currently meet all the conditions for equity classification; and therefore, we record common stock on the settlement date at the purchase price contemplated by the contract. Furthermore, we consider the potential dilution resulting from forward sales contracts in our earnings per share calculations. We use the treasury method to determine the dilution, if any, from the forward sales contracts during the period of time prior to settlement. See Note 8 to the consolidated financial statements for details of our 2021 forward sales transactions.















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Recent Accounting Pronouncements
Issued in 2021:
ASU 2021-05, July 2021, Lessors - Certain Leases with Variable Lease Payments (Topic 842)
This ASU amends the lessor lease classification in ASC 842 for leases that include variable lease payments that are not based on an index or rate. Under the amended guidance, lessors will classify a lease with variable payments that do not depend on an index or rate as an operating lease if the lease would have been classified as a sales-type lease or a direct financing lease under the previous ASU 842 classification criteria, and sales-type or direct financing lease classification would result in a Day 1 loss.

This guidance is effective for annual periods beginning after December 15, 2021, and interim periods therein.
The adoption of this standard does not have an impact to our consolidated financial statements.
Issued in 2020:
ASU 2020-04, March 2020, Reference Rate Reform (Topic 848)
This ASU provides companies with optional practical expedients to ease the accounting burden for contract modifications associated with transitioning away from LIBOR and other interbank offered rates that are expected to be discontinued as part of reference rate reform. For hedges, the guidance generally allows changes to the reference rate and other critical terms without having to de-designate the hedging relationship, as well as allows the shortcut method to continue to be applied. For contract modifications, changes in the reference rate or other critical terms will be treated as a continuation of the prior contract.

This guidance can be applied immediately, however, is generally only available through December 31, 2022.
We are still evaluating the impact of reference rate reform and whether we will apply any of these practical expedients.
ASU 2020-06, August 2020, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity
This ASU simplifies the accounting for convertible instruments by removing the requirements to separately present certain conversion features in equity, simplifying the settlement assessment that entities are required to perform to determine whether a contract qualifies for equity classification, and generally requiring the use of the if-converted method for all convertible instruments in the diluted EPS calculation and include the effect of potential share settlement (if the effect is more dilutive). The guidance is effective for annual period beginning after December 15, 2021, and interim periods therein. The adoption of this standard does not have an impact to our consolidated financial statements.

Consolidated Statements of Cash Flows—Supplemental Disclosures
The following table provides supplemental disclosures related to the Consolidated Statements of Cash Flows:
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 Year Ended December 31,
 202120202019
 (In thousands)
SUPPLEMENTAL DISCLOSURES:
Total interest costs incurred$150,324 $159,718 $130,110 
Interest capitalized(22,626)(23,429)(20,487)
Interest expense$127,698 $136,289 $109,623 
Cash paid for interest, net of amounts capitalized$123,585 $130,248 $106,180 
Cash paid for income taxes$386 $580 $483 
NON-CASH INVESTING AND FINANCING TRANSACTIONS:
DownREIT operating partnership units issued with acquisition$— $18,920 $— 
Mortgage loans assumed with acquisition (1)$— $8,903 $98,041 
DownREIT operating partnership units redeemed for common shares$7,545 $— $14,105 
Settlement of partner loan receivable via dilution of partner interests$— $— $5,379 
Shares issued under dividend reinvestment plan$1,727 $1,734 $1,784 
(1) See our Annual Report on Form 10-K for the year ended December 31, 2020 for additional disclosures relating to the mortgages entered into and assumed as a result of the Hoboken acquisition.
 December 31,
20212020
 (In thousands)
RECONCILIATION OF CASH, CASH EQUIVALENTS, AND RESTRICTED CASH:
Cash and cash equivalents$162,132 $798,329 
Restricted cash (1)13,031 18,567 
Total cash, cash equivalents, and restricted cash$175,163 $816,896 
(1)Restricted cash balances are included in "prepaid expenses and other assets" on our consolidated balance sheets.

NOTE 3—REAL ESTATE
2021 Property Acquisitions
On January 4, 2021, we acquired our partner's 20% interest in our joint venture arrangement related to the Pike & Rose hotel for $2.3 million, and repaid the $31.5 million mortgage loan encumbering the hotel. As a result of the transaction, we gained control of the hotel, and effective January 4, 2021, we have consolidated this asset. We also recognized a gain on acquisition of the controlling interest of $2.1 million related to the difference between the carrying value and fair value of the previously held equity interest.
On February 22, 2021, we acquired the fee interest at our Mount Vernon Plaza property in Alexandria, Virginia for $5.6 million. As a result of this transaction, the "operating lease right of use assets" and "operating lease liabilities" on our consolidated balance sheet decreased by $9.8 million. We now own the entire fee interest on this property.
During the year ended December 31, 2021, we acquired the following properties:
Date AcquiredPropertyCity/StateGross Leasable Area (GLA)Ownership %Gross Value
(in square feet)(in millions)
April 30, 2021Chesterbrook (1)McLean, Virginia90,00080 %$32.1 (2)
June 1, 2021Grossmont Center (1)La Mesa, California933,00060 %$175.0 (3)
June 14, 2021Camelback Colonnade (1)Phoenix, Arizona642,00098 %$162.5 (4)
June 14, 2021Hilton Village (1)Scottsdale, Arizona93,00098 %$37.5 (5)
September 2, 2021Twinbrooke Shopping CentreFairfax, Virginia106,000100 %$33.8 (6)
(1)These acquisitions were completed through newly formed joint ventures, for which we own the controlling interest listed above, and therefore, these properties are consolidated in our financial statements.
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(2)Approximately $1.9 million and $0.6 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $8.0 million of net assets acquired were allocated to other liabilities for "below market leases."
(3)Approximately $12.3 million and $2.6 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $14.7 million of net assets acquired were allocated to other liabilities for "below market leases."
(4)Approximately $11.6 million of net assets acquired were allocated to other assets for "acquired lease costs" and $28.3 million were allocated to other liabilities for "below market leases."
(5)The land is controlled under a long-term ground lease that expires on December 31, 2076, for which we have recorded a $10.4 million "operating lease right of use asset" (net of a $1.3 million above market liability) and an $11.6 million "operating lease liability." Approximately $2.7 million and $1.1 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $3.6 million were allocated to other liabilities for "below market leases."
(6)Approximately $1.2 million and $0.3 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $2.7 million of net assets acquired were allocated to other liabilities for "below market leases."
2021 Property Dispositions
During the year ended December 31, 2021, we sold two properties and a portion of three properties for a total sales price of $141.6 million, which resulted in a net gain of $88.3 million.
2020 Property Acquisitions
Date AcquiredPropertyCity/StateGross Leasable Area (GLA)Purchase Price
(in square feet)(in millions)
January 10, 2020
Fairfax JunctionFairfax, Virginia49,000$22.3 (1)
February 12, 2020
Hoboken (2 mixed-use buildings)Hoboken, New Jersey
12,000
$14.3 (2)
(1) This property is adjacent to, and is operated as part of the property acquired in 2019. The purchase price was paid with a combination of cash and the issuance of 163,322 downREIT operating partnership units. Approximately $0.5 million and $0.4 million of net assets acquired were allocated to other assets for "above market leases," and other liabilities for "below market leases," respectively.
(2) The purchase price includes the assumption of $8.9 million of mortgage debt, and is in addition to the 37 buildings previously acquired in 2019, and was completed through the same joint venture. Less than $0.1 million and approximately $3.3 million of net assets acquired were allocated to other assets for "above market leases," and other liabilities for "below market leases," respectively.
2020 Impairment
On September 1, 2020, the $60.6 million non-recourse mortgage loan on The Shops at Sunset Place matured. The mortgage was not repaid, and thus the lender declared the loan in default. We evaluated our long-term plans for the property, taking into account current market conditions and prospective development and redevelopment returns, as well as the impact of COVID-19 on the revenue prospects for the property, and concluded we did not expect to move forward with the planned redevelopment or repay the mortgage balance, and thus, did not expect to be long term holders of the asset. Given these expectations, we recorded an impairment charge of $57.2 million during the third quarter of 2020.
The fair value estimate used to determine the impairment charge was determined by market comparable data and discounted cash flow analyses. The cash flows utilized in such analyses are comprised of unobservable inputs which include forecasted rental revenue and expenses based upon market conditions and future expectations. The capitalization rates and discount rates utilized in such analyses are based upon unobservable rates that we believe to be within a reasonable range of current market rates for the property. Based on these inputs, we have determined that the $57 million estimated valuation of the property is classified within Level 3 of the fair value hierarchy.
On December 31, 2020, we sold The Shops at Sunset Place for $65.5 million and repaid the mortgage loan. The resulting gain of $9.2 million is included in the cumulative 2020 gain of $98.1 million noted in the 2020 Property Dispositions section below.
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2020 Property Dispositions
During the year ended December 31, 2020, we sold three properties (including The Shops at Sunset Place discussed above) and one building for a total sales price of $186.1 million, which resulted in a net gain of $98.1 million.
During the year ended December 31, 2020, we closed on the sale of the remaining two condominium units at our Pike & Rose property, receiving proceeds net of closing costs of $2.1 million.

NOTE 4—ACQUIRED LEASES
Acquired lease assets comprise of above market leases where we are the lessor and below market leases where we are the lessee. Acquired lease liabilities comprise of below market leases where we are the lessor and above market leases where we are the lessee. As a lessor, acquired above market leases are included in prepaid expenses and other assets, and acquired below market leases are included in other liabilities and deferred credits. In accordance with our adoption of ASC Topic 842, acquired below market leases and acquired above market leases where we are the lessee are included in right of use assets. The following is a summary of our acquired lease assets and liabilities:
December 31, 2021December 31, 2020
CostAccumulated AmortizationCostAccumulated Amortization
(in thousands)
Above market leases, lessor$46,951 $(33,617)$43,560 $(31,661)
Below market leases, lessee34,604 (5,019)34,604 (4,190)
    Total$81,555 $(38,636)$78,164 $(35,851)
Below market leases, lessor$(230,059)$78,327 $(174,582)$68,286 
Above market leases, lessee(10,347)2,654 (9,084)2,116 
    Total$(240,406)$80,981 $(183,666)$70,402 
The value allocated to acquired leases where we are the lessor is amortized over the related lease term and reflected as additional rental income for below market leases or a reduction of rental income for above market leases in the consolidated statements of comprehensive income. The related amortization of acquired leases where we are the lessee is reflected as additional rental expense for below market leases or a reduction of rental expenses for above market leases in the consolidated statements of comprehensive income. The following is a summary of acquired lease amortization:
Year Ended December 31,
202120202019
(in thousands)
Amortization of above market leases, lessor$(3,150)$(4,060)$(3,239)
Amortization of below market leases, lessor11,897 8,406 9,623 
    Net increase in rental income$8,747 $4,346 $6,384 
Amortization of below market leases, lessee$828 $828 $828 
Amortization of above market leases, lessee(538)(525)(525)
    Net increase in rental expense$290 $303 $303 
The following is a summary of the remaining weighted average amortization period for our acquired lease assets and acquired lease liabilities:
December 31, 2021
Above market leases, lessor3.2 years
Below market leases, lessee37.6 years
Below market leases, lessor18.1 years
Above market leases, lessee17.6 years
The amortization for acquired leases during the next five years and thereafter, assuming no early lease terminations, is as follows:
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Acquired Lease AssetsAcquired Lease Liabilities
 (In thousands)
Year ending December 31,
2022$3,674 $13,541 
20233,446 12,962 
20243,139 12,450 
20252,126 8,984 
20261,931 8,622 
Thereafter28,603 102,866 
$42,919 $159,425 

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NOTE 5—DEBT
The following is a summary of our total debt outstanding as of December 31, 2021 and 2020:
Principal Balance as of December 31,Stated Interest Rate as ofStated Maturity Date as of
Description of Debt20212020December 31, 2021December 31, 2021
Mortgages payable(Dollars in thousands)
Sylmar Towne Center$— $16,236 5.39 %June 6, 2021
Plaza Del Sol— 8,041 5.23 %December 1, 2021
THE AVENUE at White Marsh— 52,705 3.35 %January 1, 2022
Montrose Crossing— 65,596 4.20 %January 10, 2022
Azalea40,000 40,000 3.73 %November 1, 2025
Bell Gardens12,127 12,408 4.06 %August 1, 2026
Plaza El Segundo125,000 125,000 3.83 %June 5, 2027
The Grove at Shrewsbury (East)43,600 43,600 3.77 %September 1, 2027
Brook 3511,500 11,500 4.65 %July 1, 2029
Hoboken (24 Buildings) (1)56,450 56,450 LIBOR + 1.95%December 15, 2029
Various Hoboken (14 Buildings)31,817 32,705 Various (2)Various through 2029
Chelsea4,851 5,234 5.36 %January 15, 2031
Hoboken (1 Building) (3)16,234 16,560 3.75 %July 1, 2042
Subtotal341,579 486,035 
Net unamortized debt issuance costs and premium(1,586)(1,924)
Total mortgages payable, net339,993 484,111 
Notes payable
Revolving credit facility— — LIBOR + 0.775%January 19, 2024
Term loan300,000 400,000 LIBOR + 0.80%April 16, 2024
Various2,635 3,270 11.31 %Various through 2028
Subtotal302,635 403,270 
Net unamortized debt issuance costs(1,169)(494)
Total notes payable, net301,466 402,776 
Senior notes and debentures
2.75% notes275,000 275,000 2.75 %June 1, 2023
3.95% notes600,000 600,000 3.95 %January 15, 2024
1.25% notes400,000 400,000 1.25 %February 15, 2026
7.48% debentures29,200 29,200 7.48 %August 15, 2026
3.25% notes475,000 475,000 3.25 %July 15, 2027
6.82% medium term notes40,000 40,000 6.82 %August 1, 2027
3.20% notes400,000 400,000 3.20 %June 15, 2029
3.50% notes400,000 400,000 3.50 %June 1, 2030
4.50% notes550,000 550,000 4.50 %December 1, 2044
3.625% notes250,000 250,000 3.625 %August 1, 2046
Subtotal3,419,200 3,419,200 
Net unamortized debt issuance costs and premium(13,112)(14,712)
Total senior notes and debentures3,406,088 3,404,488 
Total debt$4,047,547 $4,291,375 
_____________________
1)On November 26, 2019, we entered into two interest rate swap agreements that fix the interest rate on the mortgage loan at 3.67%.
2)The interest rates on these mortgages range from 3.91% to 5.00%.
3)This mortgage loan has a fixed interest rate, however, the rate resets every five years until maturity. The current interest rate is fixed until July 1, 2022, and the loan is prepayable at par anytime after this date.

On April 16, 2021, we repaid $100.0 million of our existing $400.0 million term loan, amended the agreement on the remaining $300.0 million to lower the current spread over LIBOR from 135 basis points to 80 basis points based on our current credit rating, and extended the initial maturity date to April 16, 2024, along with two one-year extensions, at our option.
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In 2021, we repaid the following mortgage loans, at par, prior to their original maturity date:
PropertyRepayment DatePrincipal
(in millions)
Sylmar Towne CenterFebruary 5, 2021$16.2 
Plaza Del SolSeptember 1, 2021$7.9 
Montrose CrossingOctober 12, 2021$64.1 
The AVENUE at White MarshNovember 2, 2021$52.7 
During 2021, 2020 and 2019, the maximum amount of borrowings outstanding under our revolving credit facility was $150.0 million, $990.0 million and $116.5 million, respectively. The weighted average amount of borrowings outstanding was $19.6 million, $138.5 million and $26.8 million, respectively, and the weighted average interest rate, before amortization of debt fees, was 0.9%, 1.5% and 3.2%, respectively. The revolving credit facility requires an annual facility fee of $1.0 million. At December 31, 2021 and December 31, 2020, our revolving credit facility had no balance outstanding.
Our revolving credit facility, term loan, and certain notes require us to comply with various financial covenants, including the maintenance of minimum shareholders’ equity and debt coverage ratios and a maximum ratio of debt to net worth. As of December 31, 2021, we were in compliance with all default related debt covenants.
Scheduled principal payments on mortgages payable, notes payable, senior notes and debentures as of December 31, 2021 are as follows:
Mortgages
Payable
Notes
Payable
Senior Notes and
Debentures
Total
Principal
 (In thousands) 
Year ending December 31,
2022$3,351 $744 $— $4,095   
20233,549 758 275,000 279,307   
20243,688 300,659 (1)(2)600,000 904,347   
202548,033   383 — 48,416   
202626,657   54 429,200 455,911   
Thereafter256,301   37   2,115,000 2,371,338   
$341,579   $302,635   $3,419,200 $4,063,414 (3)
 _____________________
(1)Our $300.0 million term loan matures on April 16, 2024 plus two one-year extensions, at our option.
(2)Our $1.0 billion revolving credit facility matures on January 19, 2024, plus two six-month extensions at our option. As of December 31, 2021, there was no balance outstanding under this credit facility.
(3)The total debt maturities differ from the total reported on the consolidated balance sheet due to the unamortized net debt issuance costs and premium/discount on mortgage loans, notes payable, and senior notes as of December 31, 2021.

NOTE 6—FAIR VALUE OF FINANCIAL INSTRUMENTS
A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability in an orderly transaction. The hierarchy for inputs used in measuring fair value are as follows:
1.Level 1 Inputs—quoted prices in active markets for identical assets or liabilities
2.Level 2 Inputs—observable inputs other than quoted prices in active markets for identical assets and liabilities
3.Level 3 Inputs—prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable
In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.
Except as disclosed below, the carrying amount of our financial instruments approximates their fair value. The fair value of our mortgages payable, notes payable and senior notes and debentures is sensitive to fluctuations in interest rates. Quoted market
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prices (Level 1) were used to estimate the fair value of our marketable senior notes and debentures and discounted cash flow analysis (Level 2) is generally used to estimate the fair value of our mortgages and notes payable. Considerable judgment is necessary to estimate the fair value of financial instruments. The estimates of fair value presented herein are not necessarily indicative of the amounts that could be realized upon disposition of the financial instruments. A summary of the carrying amount and fair value of our mortgages payable, notes payable and senior notes and debentures is as follows:
 December 31, 2021December 31, 2020
Carrying
Value
Fair ValueCarrying
Value
Fair Value
(In thousands)
Mortgages and notes payable$641,459 $655,864 $886,887 $879,390 
Senior notes and debentures$3,406,088 $3,649,776 $3,404,488 $3,761,465 

As of December 31, 2021, we have two interest rate swap agreements with notional amounts of $56.5 million that are measured at fair value on a recurring basis. The interest rate swap agreements fix the interest rate on $56.5 million of mortgage payables at 3.67% through December 15, 2029. The fair values of the interest rate swap agreements are based on the estimated amounts we would receive or pay to terminate the contracts at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The fair value of our swaps at December 31, 2021 was a liability of $1.5 million and is included in "other liabilities and deferred credits" on our consolidated balance sheet. During 2021, the value of our interest rate swaps increased $3.2 million (including $0.9 million reclassified from other comprehensive income to interest expense). A summary of our financial liabilities that are measured at fair value on a recurring basis, by level within the fair value hierarchy is as follows:
December 31, 2021December 31, 2020
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
(In thousands)
Interest rate swaps$— $(1,511)$— $(1,511)$— $(4,711)$— $(4,711)
One of our equity method investees has two interest rate swaps which qualify as cash flow hedges. At December 31, 2021 and December 31, 2020, our share of the change in fair value of the related swaps included in "accumulated other comprehensive loss" was an increase of $0.7 million and a decrease of $0.5 million, respectively.

NOTE 7—COMMITMENTS AND CONTINGENCIES
We are sometimes involved in lawsuits, warranty claims, and environmental matters arising in the ordinary course of business. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters.
We are currently a party to various legal proceedings. We accrue a liability for litigation if an unfavorable outcome is probable and the amount of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, we accrue the best estimate within the range; however, if no amount within the range is a better estimate than any other amount, the minimum within the range is accrued. Legal fees related to litigation are expensed as incurred. We do not believe that the ultimate outcome of these matters, either individually or in the aggregate, could have a material adverse effect on our financial position or overall trends in results of operations; however, litigation is subject to inherent uncertainties. Also under our leases, tenants are typically obligated to indemnify us from and against all liabilities, costs and expenses imposed upon or asserted against us (1) as owner of the properties due to certain matters relating to the operation of the properties by the tenant, and (2) where appropriate, due to certain matters relating to the ownership of the properties prior to their acquisition by us.
We are self-insured for general liability costs up to predetermined retained amounts per claim, and we believe that we maintain adequate accruals to cover our retained liability. We currently do not maintain third party stop-loss insurance policies to cover liability costs in excess of predetermined retained amounts. Our accrual for self-insurance liability is determined by management and is based on claims filed and an estimate of claims incurred but not yet reported. Management considers a number of factors, including third-party actuarial analysis, previous experience in our portfolio, and future increases in costs of claims, when making these determinations. If our liability costs exceed these accruals, it will reduce our net income.
We reserve for estimated losses, if any, associated with warranties given to a buyer at the time real estate is sold or other potential liabilities relating to that sale, taking any insurance policies into account. These warranties may extend up to ten years and require significant judgment. If changes in facts and circumstances indicate that warranty reserves are understated, we will
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accrue additional reserves at such time a liability has been incurred and the costs can be reasonably estimated. Warranty reserves are released once the legal liability period has expired or all related work has been substantially completed.
On December 11, 2019, we received proceeds related to the sale under the threat of condemnation at San Antonio Center as discussed in our Annual Report on Form 10-K for the year ended December 31, 2019. We have indemnified the condemning authority for all costs incurred related to the condemnation proceedings including any payments required to tenants at the property and expect the process will take several years to complete. During 2021, we did not incur any payments, and consequently, at December 31, 2021, our liability remains $32.6 million to reflect our estimate of the remaining consideration.
At December 31, 2021 and 2020, our reserves for general liability costs were $5.2 million and $4.6 million, respectively, and are included in “accounts payable and accrued expenses” in our consolidated balance sheets. Any potential losses which exceed our estimates would result in a decrease in our net income. During 2021 and 2020, we made payments from these reserves of $1.5 million and $0.8 million, respectively. Although we consider the reserve to be adequate, there can be no assurance that the reserve will prove to be adequate over-time to cover losses due to the difference between the assumptions used to estimate the reserve and actual losses.
At December 31, 2021, we had letters of credit outstanding of approximately $4.8 million.
As of December 31, 2021 in connection with capital improvement, development, and redevelopment projects, the Trust has contractual obligations of approximately $319.2 million.
We are obligated under operating lease agreements on several shopping centers and one office lease requiring minimum annual payments as follows, as of December 31, 2021:
 (In thousands)
Year ending December 31,
2022$5,191 
20235,278 
20245,455 
20255,326 
20264,831 
Thereafter177,395 
Total future minimum operating lease payments203,476 
Less amount representing interest(130,815)
Operating lease liabilities$72,661 

Future minimum lease payments and their present value for properties under finance leases as of December 31, 2021, are as follows: 
 (In thousands)
Year ending December 31,
2022$5,810 
202360,013 
20241,013 
20251,013 
20261,013 
Thereafter79,824 
Total future minimum finance lease payments148,686 
Less amount representing interest(76,654)
Finance lease liabilities$72,032 
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A master lease for Mercer Mall includes a fixed purchase price option for $55 million in 2023. If we fail to exercise our purchase option, the owner of Mercer Mall has a put option which would require us to purchase Mercer Mall for $60 million in 2025.
Under the terms of the Congressional Plaza partnership agreement, a minority partner has the right to require us and the other minority partner to purchase its 26.63% interest in Congressional Plaza at the interest’s then-current fair market value. If the other minority partner defaults in their obligation, we must purchase the full interest. Based on management’s current estimate of fair market value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from approximately $67 million to $71 million.
A master lease for Melville Mall, as amended on October 14, 2021, includes a fixed price put option at any time prior to June 30, 2025, requiring us to purchase Melville Mall for approximately $3.6 million. Additionally, we have the right to purchase Melville Mall in 2026 for approximately $3.6 million. The consideration is net of a contract amendment fee to be paid by the landlord.
Two of the members in Plaza El Segundo have the right to require us to purchase their 10.0% and 11.8% ownership interests at the interests' then-current fair market value. If the members fail to exercise their put options, we have the right to purchase each of their interests on or after December 30, 2026 at fair market value. Based on management’s current estimate of fair market value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from approximately $25 million to $28 million.
The other member in The Grove at Shrewsbury and Brook 35 has the right to require us to purchase all of its approximately 4.1% interest in The Grove at Shrewsbury and approximately 6.5% interest in Brook 35 at the interests' then-current fair market value. Based on management's current estimate of fair market value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $6 million to $7 million.
Effective September 18, 2023, the other member in Hoboken has the right to require us to purchase all of its 10.0% ownership interest at the interest's then-current fair market value. Based on management's current estimate of fair market value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $9 million to $10 million.
Effective June 14, 2026, the other member in Cambelback Colonnade and Hilton Village has the right to require us to purchase all of its 2.0% ownership interest at the interest's then-current fair market value. Based on management's current estimate of fair value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $4 million to $5 million.
Effective June 1, 2029, the other member in Grossmont Center has the right to require us to purchase all of its 40.0% ownership interest at the interest's then-current fair market value. Based on management's current estimate of fair value as of December 31, 2021, our estimated maximum liability upon exercise of the put option would range from $68 million to $73 million.
Under the terms of certain partnership agreements, the partners have the right to exchange their operating partnership units for cash or the same number of our common shares, at our option. A total of 666,831 downREIT operating partnership units are outstanding which have a total fair value of $90.9 million, based on our closing stock price on December 31, 2021.

NOTE 8—SHAREHOLDERS’ EQUITY
We have a Dividend Reinvestment Plan (the “Plan”), whereby shareholders may use their dividends and optional cash payments to purchase shares. In 2021, 2020 and 2019, 19,758 shares, 24,491 shares, and 15,909 shares, respectively, were issued under the Plan.
As of December 31, 2021, 2020, and 2019, we had 6,000,000 Depositary Shares outstanding, each representing 1/1000th interest of 5.0% Series C Cumulative Redeemable Preferred Share, par value $0.01 per share ("Series C Preferred Shares"), at the liquidation preference of $25.00 per depositary share (or $25,000 per Series C Preferred share). The Series C Preferred Shares accrue dividends at a rate of 5.0% of the $25,000 liquidation preference per year and are redeemable at our option on or after September 29, 2022. Additionally, they are not convertible and holders of these shares generally have no voting rights, unless we fail to pay dividends for six or more quarters.
As of December 31, 2021, 2020, and 2019, we had 399,896 shares of 5.417% Series 1 Cumulative Convertible Preferred Shares (“Series 1 Preferred Shares”) outstanding that have a liquidation preference of $25 per share and par value $0.01 per share. The Series 1 Preferred Shares accrue dividends at a rate of 5.417% per year and are convertible at any time by the holders to our common shares at a conversion rate of $104.69 per share. The Series 1 Preferred Shares are also convertible under certain circumstances at our election. The holders of the Series 1 Preferred Shares have no voting rights.
On February 24, 2021, we replaced our existing at-the-market (“ATM”) equity program with a new ATM equity program in which we may from time to time offer and sell common shares having an aggregate offering price of up to $500.0 million. On
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May 7, 2021, we amended this ATM equity program, which resets the limit to $500.0 million. The new ATM equity program also allows shares to be sold through forward sales contracts. We intend to use the net proceeds to fund potential acquisition opportunities, fund our development and redevelopment pipeline, repay indebtedness and/or for general corporate purposes.
For the year ended December 31, 2021, we issued 847,471 common shares at a weighted average price per share of $104.19 for net cash proceeds of $87.0 million including paying $0.9 million in commissions and $0.4 million in additional offering expenses related to the sales of these common shares. For the year ended December 31, 2020, we issued 1,080,804 common shares at a weighted average price per share of $92.51 for net cash proceeds of $98.8 million and paid $1.0 million in commissions and $0.1 million in additional offering expenses related to the sales of these common shares.
We also entered into forward sales contracts for the year ended December 31, 2021 for 2,999,955 common shares under our ATM equity program at a weighted average offering price of $120.22. During 2021, we settled a portion of the forward sales agreements entered into during the year by issuing 796,300 common shares for net proceeds of $85.7 million.
The forward price that we will receive upon physical settlement of the remaining forward sale agreements is subject to the adjustment for (i) commissions, (ii) a floating interest rate factor equal to a specified daily rate less a spread, (iii) the forward purchasers' stock borrowing costs and (iv) scheduled dividends during the term of the forward sale agreements. The remaining open forward shares may be settled at any time on or before multiple required settlement dates ranging from June 2022 to December 2022. As of December 31, 2021, we had the capacity to issue up to $175.0 million in common shares under our ATM equity program.

NOTE 9—DIVIDENDS
The following table provides a summary of dividends declared and paid per share:
 Year Ended December 31,
 202120202019
 DeclaredPaidDeclaredPaidDeclaredPaid
Common shares$4.260 $4.250 $4.220 $4.210 $4.140 $4.110 
5.417% Series 1 Cumulative Convertible Preferred shares$1.354 $1.354 $1.354 $1.354 $1.354 $1.354 
5.0% Series C Cumulative Redeemable Preferred shares (1)$1.250 $1.250 $1.250 $1.250 $1.250 $1.250 
(1) Amount represents dividends per depositary share, each representing 1/1000th of a share.
A summary of the income tax status of dividends per share paid is as follows:
 Year Ended December 31,
202120202019
Common shares
Ordinary dividend$3.358 $3.452 $4.110 
Capital gain0.680 — — 
Return of capital0.212 0.758 — 
$4.250 $4.210 $4.110 
5.417% Series 1 Cumulative Convertible Preferred shares
Ordinary dividend$1.124 $1.354 $1.354 
Capital gain0.230 — — 
$1.354 $1.354 $1.354 
5.0% Series C Cumulative Redeemable Preferred shares
Ordinary dividend$1.038 $1.250 1.250 
Capital gain0.212 — — 
$1.250 $1.250 $1.250 
On November 4, 2021, the Trustees declared a quarterly cash dividend of $1.07 per common share, payable January 18, 2022 to common shareholders of record on January 3, 2022.
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NOTE 10— LEASES
At December 31, 2021, our 104 predominantly retail shopping center and mixed-use properties are located in 12 states and the District of Columbia. There are approximately 3,100 commercial leases and 3,000 residential leases. Our commercial tenants range from sole proprietorships to national retailers and corporations. At December 31, 2021, no one tenant or corporate group of tenants accounted for more than 2.7% of annualized base rent.
Our leases with commercial property and residential tenants are classified as operating leases. Commercial property leases generally range from three to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, may provide for percentage rents based on the tenant’s level of sales achieved and cost recoveries for the tenant’s share of certain operating costs. Leases on apartments are generally for a period of 1 year or less.
As of December 31, 2021, future minimum rentals from noncancelable commercial operating leases (excluding both tenant reimbursements of operating expenses and percentage rent based on tenants' sales) are as follows:
 (In thousands)
Year ending December 31,
2022$634,134 
2023596,004 
2024531,652 
2025447,549 
2026376,692 
Thereafter1,675,278 
$4,261,309 

The following table provides additional information on our operating and finance leases where we are the lessee:
Year Ended December 31,
202120202019
(In thousands)
LEASE COST:
Finance lease cost:
     Amortization of right-of-use assets$1,284 $1,284 $1,284 
     Interest on lease liabilities5,828 5,826 5,824 
Operating lease cost5,687 5,946 6,063 
Variable lease cost246 353 487 
Total lease cost$13,045 $13,409 $13,658 
OTHER INFORMATION:
Cash paid for amounts included in the measurement of lease liabilities
     Operating cash flows for finance leases$5,723 $5,736 $5,759 
     Operating cash flows for operating leases$5,288 $5,498 $5,561 
     Financing cash flows for finance leases$51 $46 $47 
December 31,
20212020
Weighted-average remaining term - finance leases16.3 years17.3 years
Weighted-average remaining term - operating leases52.8 years53.4 years
Weighted-average discount rate - finance leases8.0 %8.0 %
Weighted-average discount rate - operating leases4.5 %4.4 %
ROU assets obtained in exchange for operating lease liabilities$10,341 $855 

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NOTE 11—COMPONENTS OF RENTAL EXPENSES
The principal components of rental expenses are as follows:
 Year Ended December 31,
202120202019
(In thousands)
Repairs and maintenance$78,028 $66,845 $73,179 
Utilities27,808 25,065 27,729 
Management fees and costs24,919 23,752 24,930 
Payroll18,341 16,691 16,485 
Insurance14,406 12,439 9,036 
Marketing7,481 6,432 7,427 
Ground rent4,571 4,595 4,803 
Other operating (1)22,567 15,101 24,242 
Total rental expenses$198,121 $170,920 $187,831 
 _____________________
(1)Other operating for the year ended December 31, 2019 includes an $11.9 million charge relating to the buyout of a lease at Assembly Square Marketplace.

NOTE 12—SHARE-BASED COMPENSATION PLANS    
A summary of share-based compensation expense included in net income is as follows:
Year Ended December 31,
 202120202019
 (In thousands)
Grants of common shares and options$14,434 $13,243 $13,330 
Capitalized share-based compensation(1,425)(1,319)(1,054)
Share-based compensation expense$13,009 $11,924 $12,276 
As of December 31, 2021, we have grants outstanding under two share-based compensation plans. In May 2020, our shareholders approved the 2020 Performance Incentive Plan ("the 2020 Plan"), which authorized the grant of share options, common shares, and other share-based awards for up to 1,750,000 common shares of beneficial interest. Our 2010 Long Term Incentive Plan, as amended (the "2010 Plan”), which expired in May 2020, authorized the grant of share options, common shares and other share-based awards for up to 2,450,000 common shares of beneficial interest.
Option awards under the plans are required to have an exercise price at least equal to the closing trading price of our common shares on the date of grant. Options and restricted share awards under the plan generally vest over three to seven years and option awards typically have a ten-year contractual term. We pay dividends on unvested shares. Certain options and share awards provide for accelerated vesting if there is a change in control. Additionally, the vesting on certain option and share awards can accelerate in part or in full upon termination without cause.
The fair value of each option award is estimated on the date of grant using the Black-Scholes model. Expected volatilities, term, dividend yields, employee exercises and estimated forfeitures are primarily based on historical data. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair value of each share award is determined based on the closing trading price of our common shares on the grant date. No options were granted in 2020 and 2019.
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The following table provides a summary of the assumptions used to value options granted in 2021:
Year Ended December 31,
2021
Volatility29.3 %
Expected dividend yield4.1 %
Expected term (in years)7.5
Risk free interest rate0.9 %
The weighted-average grant-date fair value of options granted in 2021 was $16.40 per share. The following table provides a summary of option activity for 2021: 
Shares
Under
Option
Weighted-
Average
Exercise
Price
Weighted-
Average
Remaining
Contractual Term
Aggregate
Intrinsic
Value
   (In years)(In thousands)
Outstanding at December 31, 2020682 $152.34 
Granted3,658 95.77 
Exercised— — 
Forfeited or expired(682)152.34 
Outstanding at December 31, 20213,658 $95.77 9.1$148 
Exercisable at December 31, 2021— $— — $— 
The following table provides a summary of restricted share activity for 2021:
SharesWeighted-Average
Grant-Date Fair
Value
Unvested at December 31, 2020233,178 $127.32 
Granted166,746 97.46 
Vested(108,735)121.77 
Forfeited(2,193)112.05 
Unvested at December 31, 2021288,996 $112.29 
The weighted-average grant-date fair value of stock awarded in 2021, 2020 and 2019 was $97.46, $124.55 and $133.30, respectively. The total vesting-date fair value of shares vested during the year ended December 31, 2021, 2020 and 2019, was $11.0 million, $12.4 million and $13.0 million, respectively.
On February 10, 2021, 10,441 restricted stock units were awarded to an officer that vest at the end of four years. The final awards earned are based on meeting certain market based performance criteria, and may vary from 0% to 200% of the original award. The weighted-average grant-date fair value of stock awarded in 2021 was $97.01. The following table provides a summary of restricted stock unit activity for 2021:
SharesWeighted-Average
Grant-Date Fair
Value
Unvested at December 31, 2020— $— 
Granted10,441 97.01 
Vested— — 
Forfeited— — 
Unvested at December 31, 202110,441 $97.01 
As of December 31, 2021, there was $20.0 million of total unrecognized compensation cost related to unvested share-based compensation arrangements (i.e. options and unvested shares) granted under our plans. This cost is expected to be recognized over the next 4.6 years with a weighted-average period of 2.3 years.
Subsequent to December 31, 2021, common shares were awarded under various compensation plans as follows:
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DateAwardVesting TermBeneficiary
January 3, 20225,135 SharesImmediateTrustees
February 9, 2022103,463 Restricted Shares3-5 yearsOfficers and key employees


NOTE 13—SAVINGS AND RETIREMENT PLANS
We have a savings and retirement plan in accordance with the provisions of Section 401(k) of the Code. Generally, employees can elect, at their discretion, to contribute a portion of their compensation up to a maximum of $19,500 for 2021 and 2020, and 19,000 for 2019. Under the plan, we contribute 50% of each employee’s elective deferrals up to 5% of eligible earnings. In addition, we may make discretionary contributions within the limits of deductibility set forth by the Code. Our full-time employees are immediately eligible to become plan participants. Employees are eligible to receive matching contributions immediately on their participation; however, these matching payments will not vest until their third anniversary of employment. Our expense for the years ended December 31, 2021, 2020 and 2019 was approximately $816,000, $813,000 and $764,000, respectively.
A non-qualified deferred compensation plan for our officers and certain other employees was established in 1994 that allows the participants to defer a portion of their income. As of December 31, 2021 and 2020, we are liable to participants for approximately $21.0 million and $18.0 million, respectively, under this plan. Although this is an unfunded plan, we have purchased certain investments to match this obligation. Our obligation under this plan and the related investments are both included in the accompanying consolidated financial statements.
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NOTE 14—EARNINGS PER SHARE
We have calculated earnings per share (“EPS”) under the two-class method. The two-class method is an earnings allocation methodology whereby EPS for each class of common stock and participating securities is calculated according to dividends declared and participation rights in undistributed earnings. For 2021 we had 0.3 million, and for 2020 and 2019 we had 0.2 million weighted average unvested shares outstanding, respectively, which are considered participating securities. Therefore, we have allocated our earnings for basic and diluted EPS between common shares and unvested shares; the portion of earnings allocated to the unvested shares is reflected as “earnings allocated to unvested shares” in the reconciliation below.
The following potentially issuable shares were excluded from the diluted EPS calculation because their impact is anti-dilutive:
exercise of 682 stock options in 2020 and 2019, respectively,
conversions of downREIT operating partnership units and 5.417% Series 1 Cumulative Convertible Preferred Shares for 2021, 2020, and 2019, respectively, and
the issuance of 1.8 million shares issuable under forward sales agreements in 2021.
Additionally, 10,441 unvested restricted stock units are excluded from the diluted EPS calculation as the market based performance criteria in the award has not yet been achieved.
Year Ended December 31,
 202120202019
 (In thousands, except per share data)
NUMERATOR
Net income$269,081 $135,888 $360,542 
Less: Preferred share dividends(8,042)(8,042)(8,042)
Less: Income from operations attributable to noncontrolling interests(7,583)(4,182)(6,676)
Less: Earnings allocated to unvested shares(1,211)(992)(1,007)
Net income available for common shareholders, basic and diluted$252,245 $122,672 $344,817 
DENOMINATOR
Weighted average common shares outstanding—basic77,336 75,515 74,766 
Effect of dilutive securities:
Open forward contracts for share issuances32 — — 
Weighted average common shares outstanding—diluted77,368 75,515 74,766 
EARNINGS PER COMMON SHARE, BASIC
Net income available for common shareholders$3.26 $1.62 $4.61 
EARNINGS PER COMMON SHARE, DILUTED
Net income available for common shareholders$3.26 $1.62 $4.61 

NOTE 15—SUBSEQUENT EVENTS
In January of 2022, we completed the UPREIT reorganization described in the Explanatory Note at the beginning of this Annual Report. Prior to the UPREIT Reorganization, our business was conducted through the Predecessor. This Annual Report pertains to the business and results of operations of the Predecessor for its fiscal year ended December 31, 2021. As a result of the UPREIT reorganization, the Parent Company became the successor issuer to the Predecessor under the Exchange Act. The Parent Company and the Partnership have elected to co-file this Annual Report of the Predecessor to ensure continuity of information to investors. For additional information on our UPREIT reorganization, please see our Current Reports on Form 8-K filed with the SEC on January 3, 2022 and January 5, 2022.
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FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2021
(Dollars in thousands)
COLUMN ACOLUMN BCOLUMN C COLUMN DCOLUMN E  COLUMN FCOLUMN GCOLUMN HCOLUMN I
DescriptionsEncumbranceInitial cost to companyCost
Capitalized
Subsequent
to
Acquisition
Gross amount at which carried at
close of period
Accumulated
Depreciation
and
Amortization
Date
of
Construction
Date
Acquired
Life on  which
depreciation
in latest
income
statements is
computed
LandBuilding and
Improvements
LandBuilding and
Improvements
Total
29TH PLACE (Virginia)$10,211 $18,863 $11,035 $10,195 $29,914 $40,109 $15,312 1975 - 20015/30/2007(1)
ANDORRA (Pennsylvania)2,432 12,346 18,458 2,432 30,804 33,236 22,053 19531/12/1988(1)
ASSEMBLY ROW/ASSEMBLY SQUARE MARKETPLACE (Massachusetts)93,252 34,196 951,169 69,421 1,009,196 1,078,617 107,931 2005, 2012-20212005-2013(1)
AZALEA (California)39,800 40,219 67,117 628 40,219 67,745 107,964 11,036 20148/2/2017(1)
BALA CYNWYD (Pennsylvania)3,565 14,466 48,471 2,683 63,819 66,502 29,407 1955/20209/22/1993(1)
BARCROFT PLAZA (Virginia)12,617 29,603 7,968 12,617 37,571 50,188 7,320 1963, 1972, 1990, & 20001/13/16 & 11/7/16(1)
BARRACKS ROAD (Virginia)4,363 16,459 49,352 4,363 65,811 70,174 50,852 195812/31/1985(1)
BELL GARDENS (California)11,861 24,406 85,947 1,929 24,406 87,876 112,282 18,619 1990, 2003, 20068/2/17 & 11/29/18(1)
BETHESDA ROW (Maryland)46,579 35,406 168,421 43,904 206,502 250,406 99,202 1945-200812/31/93, 6/2/97, 1/20/06, 9/25/08, 9/30/08, & 12/27/10 (1)
BIRCH & BROAD (formerly known as Falls Plaza) (Virginia)1,798 1,270 20,876 1,819 22,125 23,944 9,741 1960/19629/30/67 & 10/05/72(1)
BRICK PLAZA (New Jersey)— 24,715 79,632 4,094 100,253 104,347 60,075 195812/28/1989(1)
BRISTOL PLAZA (Connecticut)3,856 15,959 15,398 3,856 31,357 35,213 20,652 19599/22/1995(1)
BROOK 35 (New Jersey)11,345 7,128 38,355 4,722 7,128 43,077 50,205 11,296 1986/20041/1/2014(1)
CAMELBACK COLONNADE (Arizona)52,658 126,646 49 52,658 126,695 179,353 2,655 1977/20196/14/2021(1)
CAMPUS PLAZA (Massachusetts)16,710 13,412 433 16,710 13,845 30,555 3,381 19701/13/2016(1)
CHELSEA COMMONS (Massachusetts)4,692 8,689 19,466 2,439 8,669 21,925 30,594 9,596 1962/1969/
2008
8/25/06, 1/30/07, & 7/16/08(1)
CHESTERBROOK (Virginia)13,042 24,725 509 13,042 25,234 38,276 594 1967/19914/30/21(1)
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Table of Contents
FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2021
(Dollars in thousands)
COLUMN ACOLUMN BCOLUMN C COLUMN DCOLUMN E  COLUMN FCOLUMN GCOLUMN HCOLUMN I
DescriptionsEncumbranceInitial cost to companyCost
Capitalized
Subsequent
to
Acquisition
Gross amount at which carried at
close of period
Accumulated
Depreciation
and
Amortization
Date
of
Construction
Date
Acquired
Life on  which
depreciation
in latest
income
statements is
computed
LandBuilding and
Improvements
LandBuilding and
Improvements
Total
COCOWALK (Florida)32,513 71,536 87,188 48,944 142,293 191,237 16,485 1990/1994, 1922-1973, 2018-20215/4/15, 7/1/15, 12/16/15, 7/26/16, 6/30/17, & 8/10/17(1)
COLORADO BLVD (California)2,415 3,964 7,109 2,415 11,073 13,488 9,715 1905-19888/14/98(1)
CONGRESSIONAL PLAZA (Maryland)2,793 7,424 97,556 2,793 104,980 107,773 63,539 1965/2003/20164/1/1965(1)
COURTHOUSE CENTER (Maryland)1,750 1,869 3,497 1,750 5,366 7,116 3,141 197512/17/1997(1)
CROSSROADS (Illinois)4,635 11,611 19,769 4,635 31,380 36,015 21,669 19597/19/1993(1)
CROW CANYON COMMONS (California)27,245 54,575 8,854 27,245 63,429 90,674 30,337 Late 1970's/
1998/2006
12/29/05 & 2/28/07(1)
DARIEN COMMONS (Connecticut)30,368 19,523 48,601 30,368 68,124 98,492 3,561 1920-20094/3/13 & 7/20/18(1)
DEDHAM PLAZA (Massachusetts)16,658 13,964 17,152 16,658 31,116 47,774 19,358 195912/31/93, 12/14/16, 1/29/19, & 3/12/19(1)
DEL MAR VILLAGE (Florida)15,624 41,712 16,886 15,587 58,635 74,222 28,150 1982/1994/ 20075/30/08, 7/11/08, & 10/14/14(1)
EAST BAY BRIDGE (California)29,069 138,035 12,354 29,069 150,389 179,458 46,612 1994-2001, 2011/201212/21/2012(1)
ELLISBURG (New Jersey)4,028 11,309 20,737 4,013 32,061 36,074 22,684 195910/16/1992(1)
ESCONDIDO PROMENADE (California)19,117 15,829 19,823 19,117 35,652 54,769 22,092 198712/31/96 & 11/10/10(1)
FAIRFAX JUNCTION (Virgina)16,768 23,825 1,216 16,768 25,041 41,809 2,724 1981/1986/ 20002/8/19 & 1/10/20(1)
FEDERAL PLAZA (Maryland)10,216 17,895 43,788 10,216 61,683 71,899 50,473 19706/29/1989(1)
FINLEY SQUARE (Illinois)9,252 9,544 22,953 9,252 32,497 41,749 24,386 19744/27/1995(1)
FLOURTOWN (Pennsylvania)1,345 3,943 11,910 1,507 15,691 17,198 7,851 19574/25/1980(1)
FOURTH STREET (California)13,978 9,909 3,345 13,978 13,254 27,232 2,627 1948,19755/19/2017(1)
FREEDOM PLAZA (California)— 3,255 40,620 — 43,875 43,875 1,820 2018-20206/15/2018(1)
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FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2021
(Dollars in thousands)
COLUMN ACOLUMN BCOLUMN C COLUMN DCOLUMN E  COLUMN FCOLUMN GCOLUMN HCOLUMN I
DescriptionsEncumbranceInitial cost to companyCost
Capitalized
Subsequent
to
Acquisition
Gross amount at which carried at
close of period
Accumulated
Depreciation
and
Amortization
Date
of
Construction
Date
Acquired
Life on  which
depreciation
in latest
income
statements is
computed
LandBuilding and
Improvements
LandBuilding and
Improvements
Total
FRESH MEADOWS (New York)24,625 25,255 44,201 24,633 69,448 94,081 48,793 1946-194912/5/1997(1)
FRIENDSHIP CENTER (District of Columbia)12,696 20,803 2,966 12,696 23,769 36,465 14,158 19989/21/2001(1)
GAITHERSBURG SQUARE (Maryland)7,701 5,271 23,999 5,973 30,998 36,971 19,397 19664/22/1993(1)
GARDEN MARKET (Illinois)2,677 4,829 7,305 2,677 12,134 14,811 9,636 19587/28/1994(1)
GEORGETOWNE SHOPPING CENTER (New York)32,202 49,586 2,728 32,202 52,314 84,516 3,841 1969/2006/ 201511/15/19(1)
GOVERNOR PLAZA (Maryland)2,068 4,905 19,619 2,068 24,524 26,592 21,877 196310/1/1985(1)
GRAHAM PARK PLAZA (Virginia)642 7,629 15,155 653 22,773 23,426 18,267 19717/21/1983(1)
GRATIOT PLAZA (Michigan)525 1,601 18,168 525 19,769 20,294 18,232 19643/29/1973(1)
GREENLAWN PLAZA (New York)10,590 20,869 1,278 10,730 22,007 32,737 5,089 1975/20041/13/2016(1)
GREENWICH AVENUE (Connecticut)7,484 5,445 10,819 7,484 16,264 23,748 6,120 19684/12/1995(1)
GROSSMONT CENTER (California)125,434 50,311 173 125,434 50,484 175,918 2,093 1961, 1963, 1982-1983, 20026/1/2021(1)
HASTINGS RANCH PLAZA (California)2,257 22,393 1,055 2,257 23,448 25,705 3,812 1958, 1984, 2006, 20072/1/2017(1)
HAUPPAUGE (New York)8,791 15,262 9,789 8,420 25,422 33,842 14,452 19638/6/1998(1)
HILTON VILLAGE (Arizona)— 40,079 28 — 40,107 40,107 772 1982/19896/14/21(1)
HOBOKEN (New Jersey)104,704 47,460 167,835 1,075 47,462 168,908 216,370 11,389 1887-20069/18/19, 11/26/19, 12/19/19, & 2/12/20(1)
HOLLYWOOD BLVD (California)8,300 16,920 36,635 8,370 53,485 61,855 20,813 1929/19913/22/99 & 6/18/99(1)
HUNTINGTON (New York)12,194 16,008 23,585 12,294 39,493 51,787 17,564 196212/12/88, 10/26/07, & 11/24/15(1)
HUNTINGTON SQUARE (New York)— 10,075 3,621 506 13,190 13,696 5,281 1980/2004-20078/16/2010(1)
IDYLWOOD PLAZA (Virginia)4,308 10,026 3,212 4,308 13,238 17,546 10,526 19914/15/1994(1)
KINGS COURT (California)— 10,714 896 — 11,610 11,610 10,410 19608/24/1998(1)
LANCASTER (Pennsylvania)— 2,103 6,291 432 7,962 8,394 6,230 19584/24/1980(1)
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Table of Contents
FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2021
(Dollars in thousands)
COLUMN ACOLUMN BCOLUMN C COLUMN DCOLUMN E  COLUMN FCOLUMN GCOLUMN HCOLUMN I
DescriptionsEncumbranceInitial cost to companyCost
Capitalized
Subsequent
to
Acquisition
Gross amount at which carried at
close of period
Accumulated
Depreciation
and
Amortization
Date
of
Construction
Date
Acquired
Life on  which
depreciation
in latest
income
statements is
computed
LandBuilding and
Improvements
LandBuilding and
Improvements
Total
LANGHORNE SQUARE (Pennsylvania)720 2,974 20,100 720 23,074 23,794 17,855 19661/31/1985(1)
LAUREL (Maryland)7,458 22,525 30,379 7,503 52,859 60,362 42,998 19568/15/1986(1)
LAWRENCE PARK (Pennsylvania)6,150 8,491 36,084 6,161 44,564 50,725 24,724 19727/23/1980 & 4/3/17(1)
LINDEN SQUARE (Massachusetts)79,382 19,247 52,762 79,346 72,045 151,391 31,683 1960-20088/24/2006(1)
MELVILLE MALL (New York)35,622 32,882 36,295 35,622 69,177 104,799 22,365 197410/16/2006(1)
MERCER MALL (New Jersey)5,917 18,358 49,175 5,869 67,581 73,450 37,855 197510/14/03 & 1/31/17(1)
MONTROSE CROSSING (Maryland)48,624 91,819 27,521 48,624 119,340 167,964 39,706 1960s, 1970s, 1996 & 201112/27/11 & 12/19/13(1)
MOUNT VERNON/SOUTH VALLEY/7770 RICHMOND HWY. (Virginia)15,769 33,501 43,993 15,851 77,412 93,263 44,668 1966/1972/ 1987/20013/31/03, 3/21/03, & 1/27/06(1)
NORTH DARTMOUTH (Massachusetts)9,366 — 9,366 9,369 20048/24/2006(1)
NORTHEAST (Pennsylvania)938 8,779 24,719 939 33,497 34,436 21,263 19598/30/1983(1)
OLD KEENE MILL (Virginia)638 998 11,550 638 12,548 13,186 7,002 19686/15/1976(1)
OLD TOWN CENTER (California)3,420 2,765 32,909 3,420 35,674 39,094 24,723 1962, 1997-199810/22/1997(1)
OLIVO AT MISSION HILLS (California)15,048 46,732 20,441 15,048 67,173 82,221 6,614 2017-20188/2/2017(1)
PAN AM (Virginia)8,694 12,929 8,873 8,695 21,801 30,496 17,516 19792/5/1993(1)
PENTAGON ROW (Virginia)— 2,955 103,692 — 106,647 106,647 56,156 1999 - 20021998 & 11/22/10(1)
PERRING PLAZA (Maryland)2,800 6,461 26,626 2,800 33,087 35,887 25,356 196310/1/1985(1)
PIKE & ROSE (Maryland)31,471 10,335 682,962 33,716 691,052 724,768 83,746 1963, 2012-20215/18/82, 10/26/07, & 7/31/12(1)
PIKE 7 PLAZA (Virginia)14,970 22,799 13,142 14,914 35,997 50,911 20,740 19683/31/97 & 7/8/15(1)
PLAZA DEL MERCADO (Maryland)10,305 21,553 15,114 10,305 36,667 46,972 8,763 19691/13/2016(1)
PLAZA DEL SOL (California)5,605 12,331 (55)5,605 12,276 17,881 1,882 20098/2/2017(1)
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Table of Contents
FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2021
(Dollars in thousands)
COLUMN ACOLUMN BCOLUMN C COLUMN DCOLUMN E  COLUMN FCOLUMN GCOLUMN HCOLUMN I
DescriptionsEncumbranceInitial cost to companyCost
Capitalized
Subsequent
to
Acquisition
Gross amount at which carried at
close of period
Accumulated
Depreciation
and
Amortization
Date
of
Construction
Date
Acquired
Life on  which
depreciation
in latest
income
statements is
computed
LandBuilding and
Improvements
LandBuilding and
Improvements
Total
PLAZA EL SEGUNDO/THE POINT (California)124,521 62,127 153,556 84,287 64,788 235,182 299,970 68,627 2006/2007/ 201612/30/11, 6/14/13, 7/26/13, & 12/27/13(1)
QUEEN ANNE PLAZA (Massachusetts)3,319 8,457 6,827 3,319 15,284 18,603 11,427 196712/23/1994(1)
QUINCE ORCHARD (Maryland)3,197 7,949 29,995 2,928 38,213 41,141 25,984 19754/22/1993(1)
RIVERPOINT CENTER (Illinois)15,422 104,572 1,609 15,422 106,181 121,603 16,197 1989, 20123/31/2017(1)
ROCKVILLE TOWN SQUARE (Maryland)— 8,092 36,927 — 45,019 45,019 20,165 2005 - 20072006 - 2007(1)
ROLLINGWOOD APTS. (Maryland)552 2,246 10,695 774 12,719 13,493 10,529 19601/15/1971(1)
SAN ANTONIO CENTER (California)26,400 18,462 3,268 26,400 21,730 48,130 5,408 1958, 1964-1965, 1974-1975, 1995-19971/9/2015, 9/13/19(1)
SANTANA ROW (California)66,682 7,502 1,172,412 57,592 1,189,004 1,246,596 268,804 1999-2006, 2009, 2011, 2014, 2016-20213/5/97, 7/13/12, 9/6/12, 4/30/13 & 9/23/13(1)
SYLMAR TOWNE CENTER (California)18,522 24,637 2,964 18,522 27,601 46,123 3,936 19738/2/2017(1)
THE AVENUE AT WHITE MARSH (Maryland)20,682 72,432 30,635 20,685 103,064 123,749 45,759 19973/8/2007(1)
THE GROVE AT SHREWSBURY (New Jersey)43,070 18,016 103,115 7,759 18,021 110,869 128,890 28,225 1988/1993/ 20071/1/2014 & 10/6/14(1)
THE SHOPPES AT NOTTINGHAM SQUARE (Maryland)4,441 12,849 1,446 4,441 14,295 18,736 6,961 2005 - 20063/8/2007(1)
THIRD STREET PROMENADE (California)22,645 12,709 52,419 25,125 62,648 87,773 36,265 1888-20001996-2000(1)
TOWER SHOPPNG CENTER (Virginia)7,170 10,518 5,210 7,280 15,618 22,898 11,009 1953-19608/24/1998(1)
TOWER SHOPS (Florida)29,940 43,390 27,794 29,962 71,162 101,124 26,237 1989, 20171/19/11 & 6/13/14(1)
TOWN CENTER OF NEW BRITAIN (Pennsylvania)1,282 12,285 3,358 1,693 15,232 16,925 7,047 19696/29/2006(1)
TOWSON RESIDENTIAL (FLATS @703) (Maryland)2,328 — 20,092 2,328 20,092 22,420 2,703 2016-20173/8/2007(1)
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Table of Contents
FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 2021
(Dollars in thousands)
COLUMN ACOLUMN BCOLUMN C COLUMN DCOLUMN E  COLUMN FCOLUMN GCOLUMN HCOLUMN I
DescriptionsEncumbranceInitial cost to companyCost
Capitalized
Subsequent
to
Acquisition
Gross amount at which carried at
close of period
Accumulated
Depreciation
and
Amortization
Date
of
Construction
Date
Acquired
Life on  which
depreciation
in latest
income
statements is
computed
LandBuilding and
Improvements
LandBuilding and
Improvements
Total
TROY HILLS (New Jersey)3,126 5,193 32,847 5,865 35,301 41,166 25,111 19667/23/1980(1)
TWINBROOKE SHOPPING CENTRE (Virginia)16,484 18,898 57 16,484 18,955 35,439 263 19779/2/2021(1)
TYSON'S STATION (Virginia)388 453 5,241 493 5,589 6,082 4,238 19541/17/1978(1)
VILLAGE AT SHIRLINGTON (Virginia)9,761 14,808 39,526 4,234 59,861 64,095 33,277 1940, 2006-200912/21/1995(1)
WESTGATE CENTER (California)6,319 107,284 44,549 6,319 151,833 158,152 72,593 1960-19663/31/2004(1)
WHITE MARSH PLAZA (Maryland)3,478 21,413 1,674 3,514 23,051 26,565 11,094 19873/8/2007(1)
WHITE MARSH OTHER (Maryland)28,809 — 77 28,839 47 28,886 — 19853/8/2007(1)
WILDWOOD (Maryland)9,111 1,061 17,219 9,111 18,280 27,391 10,298 19585/5/1969(1)
WILLOW GROVE (Pennsylvania)1,499 6,643 23,943 1,499 30,586 32,085 22,653 195311/20/1984(1)
WILLOW LAWN (Virginia)3,192 7,723 94,318 7,790 97,443 105,233 67,685 195712/5/1983(1)
WYNNEWOOD (Pennsylvania)8,055 13,759 21,055 8,055 34,814 42,869 27,285 194810/29/1996(1)
TOTALS$339,993 $1,585,097 $2,725,032 $5,111,933 $1,578,280 $7,843,782 $9,422,062 $2,531,095 

(1)Depreciation of building and improvements is calculated based on useful lives ranging from the life of the lease to 50 years.
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Table of Contents
FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
Three Years Ended December 31, 2021
Reconciliation of Total Cost
(in thousands)
Balance, December 31, 2018$7,819,472 
January 1, 2019 adoption of new accounting standard - See Note 2(71,859)
Additions during period
Acquisitions309,921 
Improvements441,703 
Deduction during period—dispositions and retirements of property(201,105)
Balance, December 31, 20198,298,132 
Additions during period
Acquisitions39,440 
Improvements473,679 
Deductions during period
Impairment of property(68,484)
Dispositions and retirements of property(159,897)
Balance, December 31, 20208,582,870 
Additions during period
Acquisitions519,350 
Improvements424,521 
Deduction during period—dispositions and retirements of property(104,679)
Balance, December 31, 2021 (1)$9,422,062 
_____________________
(1)For Federal tax purposes, the aggregate cost basis is approximately $8.4 billion as of December 31, 2021.

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Table of Contents

FEDERAL REALTY INVESTMENT TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
Three Years Ended December 31, 2021
Reconciliation of Accumulated Depreciation and Amortization
(In thousands)
Balance, December 31, 2018$2,059,143 
January 1, 2019 adoption of new accounting standard - See Note 2(18,173)
Additions during period—depreciation and amortization expense215,382 
Deductions during period—dispositions and retirements of property(40,939)
Balance, December 31, 20192,215,413 
Additions during period—depreciation and amortization expense229,199 
Deductions during period
Impairment of property(11,631)
Dispositions and retirements of property(75,289)
Balance, December 31, 20202,357,692 
Additions during period—depreciation and amortization expense246,338 
Deductions during period -dispositions and retirements of property(72,935)
Balance, December 31, 2021$2,531,095 

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Table of Contents

FEDERAL REALTY INVESTMENT TRUST
SCHEDULE IV
MORTGAGE LOANS ON REAL ESTATE
Year Ended December 31, 2021

(Dollars in thousands)
Column AColumn BColumn CColumn DColumn EColumn FColumn GColumn H
Description of LienInterest RateMaturity DatePeriodic Payment
Terms
Prior
Liens
Face Amount
of Mortgages
Carrying
Amount
of Mortgages(1)
Principal
Amount
of Loans
Subject to
delinquent
Principal
or Interest
Second mortgage on a retail shopping center in Rockville, MD11.5%February 2026Interest only monthly;
balloon payment due
at maturity
$58,750 (2)$5,075 $5,075 $— 
Second mortgage on a retail shopping center in Rockville, MD10.75%February 2026Interest only monthly;
balloon payment due
at maturity
58,750 (2)4,500 4,433 — 
Second mortgage on a retail shopping center in Baltimore, MD7.0%October 2031Principal and interest monthly; balloon payment due at maturity4,990 (3)600 35 — 
$63,740   $10,175 $9,543 $— 
_____________________
(1)The amounts are net of any expected losses in accordance with ASU 2016-13. See note 2 to the consolidated financial statements. For Federal tax purposes, the aggregate tax basis is approximately $10.2 million as of December 31, 2021.
(2)These mortgages are both subordinate to a first mortgage of $58.8 million in total. We do not hold the first mortgage loan on this property. Accordingly, the amount of the prior lien at December 31, 2021 is estimated.
(3)This mortgage is subordinate to a first mortgage of $5.0 million. We do not hold the first mortgage loan on this property. Accordingly, the amount of the prior lien at December 31, 2021 is estimated.
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Table of Contents

FEDERAL REALTY INVESTMENT TRUST
SCHEDULE IV
MORTGAGE LOANS ON REAL ESTATE - CONTINUED
Three Years Ended December 31, 2021
Reconciliation of Carrying Amount
(In thousands)
Balance, December 31, 2018 and 2019$30,429 
January 1, 2020 adoption of new accounting standard - See Note 2(790)
Additions during period:
Acquisition of loans, net of valuation adjustments9,560 
Issuance of loans693 
Balance, December 31, 202039,892 
Additions during period:
Issuance of loans600 
Deductions during period:
Collection and satisfaction of loans(30,339)
Valuation adjustments(610)
Balance, December 31, 2021$9,543 

F-41