UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
COMMISSION FILE NUMBER: 001-40896
INVENTRUST PROPERTIES CORP.
(Exact name of registrant as specified in its charter)
Maryland
34-2019608
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
3025 Highland Parkway, Suite 350
Downers Grove, Illinois 60515
(855) 377-0510
(Address of principal executive offices) (Zip code)
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common stock, $0.001 par value
IVT
New York Stock Exchange
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. 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. 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 the
filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405
of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to
submit such files). 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 the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth
company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒
Accelerated filer
☐Emerging growth company
☐
Non-accelerated filer
☐
Smaller reporting company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any
new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by 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. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in
the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to Section 240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
As of June 28, 2024, the aggregate market value of the voting and non-voting common stock held by non-affiliates of InvenTrust Properties Corp.
was approximately $1.7 billion, based upon the closing price on the New York Stock Exchange for such equity on June 28, 2024.
As of February 6, 2025, there were 77,460,276 shares of the registrant's common stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Part III incorporates by reference certain information that will be contained in InvenTrust Properties Corp.'s Proxy Statement relating to its 2025
Annual Meeting of Stockholders, which InvenTrust Properties Corp. intends to file no later than 120 days after the end of its fiscal year ended
December 31, 2024, and thus these items have been omitted in accordance with General Instruction G(3) to Form 10-K.
Page
Forward-Looking Statements
ii
Part I
Item 1.
Business
1
Item 1A.
Risk Factors
4
Item 1B.
Unresolved Staff Comments
14
Item 1C.
Cybersecurity
15
Item 2.
Properties
16
Item 3.
Legal Proceedings
17
Item 4.
Mine Safety Disclosures
17
Part II
Item 5.
Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
17
Item 6.
Reserved
19
Item 7.
Management's Discussion and Analysis of Financial Condition and Results of Operations
20
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
35
Item 8.
Consolidated Financial Statements and Supplementary Data
36
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
36
Item 9A.
Controls and Procedures
36
Item 9B.
Other Information
36
Item 9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
36
Part III
Item 10.
Directors, Executive Officers and Corporate Governance
37
Item 11.
Executive Compensation
37
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
37
Item 13.
Certain Relationships and Related Transactions, and Director Independence
38
Item 14.
Principal Accounting Fees and Services
38
Part IV
Item 15.
Exhibits and Financial Statement Schedules
38
Item 16.
Form 10-K Summary
40
Signatures
41
INVENTRUST PROPERTIES CORP.
TABLE OF CONTENTS
FORWARD-LOOKING STATEMENTS
Certain statements in this Annual Report on Form 10-K ("Annual Report"), other than purely historical information, are
"forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933, as amended ("Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended
("Exchange Act"). These statements include statements about InvenTrust Properties Corp.'s (the "Company") plans, objectives,
strategies, financial performance and outlook, trends, the amount and timing of future cash distributions, prospects or future
events; and they involve known and unknown risks that are difficult to predict.
As a result, our actual financial results, performance, achievements, or prospects may differ materially from those expressed or
implied by these forward-looking statements. In some cases, forward-looking statements can be identified by the use of words
such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "guidance," "predict," "potential,"
"continue," "likely," "will," "would," "illustrative," and "should" and variations of these terms and similar expressions, or the
negatives of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and
assumptions that, while we consider reasonable based on our knowledge and understanding of the business and industry, are
inherently uncertain. These statements are expressed in good faith and are not guarantees of future performance or results. Our
actual results could differ materially from those expressed in the forward-looking statements and readers should not rely on
forward-looking statements in making investment decisions.
Our operations are subject to a number of risks and uncertainties including, but not limited to:
•
our ability to collect rent from tenants or to rent space on favorable terms or at all;
•
declaration of bankruptcy by our retail tenants;
•
the economic success and viability of our anchor retail tenants;
•
our ability to identify, execute and complete acquisition opportunities and to integrate and successfully operate any
retail properties acquired in the future and manage the risks associated with such retail properties;
•
our ability to manage the risks of expanding, developing or redeveloping our retail properties;
•
loss of members of our senior management team or other key personnel;
•
changes in the competitive environment in the leasing market and any other market in which we operate;
•
shifts in consumer retail shopping from brick-and-mortar stores to e-commerce;
•
the impact of leasing and capital expenditures to improve our retail properties to retain and attract tenants;
•
our ability to refinance or repay maturing debt or to obtain new or additional financing on attractive terms;
•
the impact on our business and financial condition of incurring additional debt or issuing new debt or equity securities
in the future;
•
future increases in interest rates;
•
rising inflation;
•
natural or man-made disasters, severe weather and climate-related events, such as hurricanes, wildfires, earthquakes,
tsunamis, tornadoes, droughts, blizzards, hailstorms, floods, mudslides, oil spills, nuclear incidents, and outbreaks of
pandemics or contagious diseases, or fear of such outbreaks;
•
our status as a real estate investment trust ("REIT") for federal tax purposes;
•
changes in federal, state or local tax law, including legislative, administrative, regulatory or other actions affecting
REITs; and
•
the risks described under Part I, Item 1A. - Risk Factors and Part II, Item 7 - Management's Discussion and Analysis
of Financial Condition and Results of Operations ("MD&A"), or identified elsewhere in this Annual Report.
These factors are not necessarily all of the important factors that could cause our actual results, performance or achievements to
differ materially from those expressed in or implied by any of our forward-looking statements. Other unknown or unpredictable
factors also could harm our business, financial condition, results of operations, cash flows and overall value.
All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the
cautionary statements set forth above. Forward-looking statements are only as of the date they are made; we do not undertake or
assume any obligation to update publicly any of these forward-looking statements to reflect actual results, new information,
future events, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent
required by applicable law. If we update one or more forward-looking statements, no inference should be drawn that we will
make additional updates with respect to those or other forward-looking statements.
ii
PART I
As used throughout this Annual Report, the terms "Company," "InvenTrust," "we," "us," or "our" mean InvenTrust Properties
Corp. and its wholly-owned subsidiaries, and, for periods presented prior to January 1, 2023, its former unconsolidated joint
venture investment. Unless otherwise noted, all dollar amounts and square feet are stated in thousands, except per share and
per square foot amounts. Any references to number of properties, square feet, and tenant and occupancy data are unaudited.
Item 1. Business
General
On October 4, 2004, InvenTrust Properties Corp. was incorporated as Inland American Real Estate Trust, Inc., a Maryland
corporation, and elected to operate in a manner to be taxed as a REIT for federal tax purposes. The Company changed its name
to InvenTrust Properties Corp. in April 2015 and is focused on owning, leasing, redeveloping, acquiring and managing a multi-
tenant retail platform. On October 12, 2021, the Company's shares of common stock were listed and began trading on the New
York Stock Exchange ("NYSE") under the ticker symbol "IVT."
As of December 31, 2024, the Company owned 68 retail properties with a total gross leasable area ("GLA") of approximately
11.0 million square feet.
The following table summarizes our retail portfolio as of December 31, 2024.
As of December 31, 2024
No. of properties
68
GLA (square feet)
10,972
Economic occupancy (a)
95.3%
Leased occupancy (b)
97.4%
ABR PSF (c)
$20.07
(a)
Economic occupancy is defined as the percentage of occupied GLA divided by total GLA (excluding Specialty Leases) for which a tenant is obligated to
pay rent under the terms of its lease agreement as of the rent commencement date, regardless of the actual use or occupancy by that tenant of the area
being leased. Actual use may be less than economic occupancy. Specialty Leases include small shop leases with terms of less than one year and leases of
common area space with terms of any term length.
(b)
Leased occupancy is defined as economic occupancy plus the percentage of signed but not yet commenced GLA divided by total GLA.
(c)
Annualized Base Rent ("ABR") is computed as base rent for the last month of the period multiplied by twelve. Base rent is inclusive of ground rent and
exclusive of Specialty Lease rent. ABR per square foot ("PSF") is computed as ABR divided by the occupied square footage as of the end of the period.
Business Strategy
InvenTrust Properties Corp. is a premier Sun Belt, multi-tenant essential retail REIT that owns, leases, redevelops, acquires, and
manages grocery-anchored neighborhood and community centers, as well as high-quality power centers that often have a
grocery component. We pursue our business strategy by:
•
Acquiring retail properties in Sun Belt markets;
•
Opportunistically disposing of retail properties; and
•
Maintaining a flexible capital structure.
Acquiring retail properties in Sun Belt markets. InvenTrust focuses on Sun Belt markets with favorable demographics,
including above-average growth in population, employment, income and education levels. We believe these conditions create
favorable demand characteristics for grocery-anchored and necessity-based retail centers, which will position us to capitalize on
potential future rent increases while enjoying sustained occupancy at our centers. Our strategically located field offices are
within a two-hour drive of over 95% of our properties which affords us the ability to respond to the needs of our tenants and
provides us with in-depth local market knowledge. We believe that our Sun Belt portfolio of high quality grocery-anchored
assets is a distinct differentiator for us in the marketplace.
Opportunistically disposing of retail properties. We continue to opportunistically dispose of properties where we believe they
no longer meet our investment criteria. These dispositions will allow us to redeploy the proceeds in more attractive
opportunities in Sun Belt markets.
1
Maintaining a flexible capital structure. We believe our current capital structure provides us with the financial flexibility and
capacity to fund our current capital needs as well as future growth opportunities. We believe we have the liquidity necessary to
continue executing on our strategic and operational objectives while exhibiting a focused and disciplined capital allocation. Our
flexible capital structure and ample liquidity will allow us to take advantage of future growth opportunities that meet our
investment criteria.
Competition
We compete with numerous companies and individuals engaged in the ownership, development, acquisition, and operation of
shopping centers in Sun Belt markets, resulting in competition for attracting and retaining tenants and acquiring and disposing
shopping centers.
Our commitment to Sun Belt markets and our strategically curated portfolio of predominantly necessity-based grocery-
anchored shopping centers provides a number of competitive advantages, including increased concentrations in high growth
Sun Belt locations to capitalize on strong demographic trends, exposure to a strong operational footprint, and distinctive levels
of Sun Belt real estate experience and expertise. Our local market presence is supported by our field offices staffed with
operational teams within two hours of over 95% of our shopping centers, which allows us to build deep real estate expertise and
a strong reputation with market participants and with our anchor and small shop tenants.
Our ample liquidity, and sector-low leverage, provide an additional competitive advantage of flexibility to transact. Our
concerted focus on the Sun Belt markets provides us greater opportunity to carefully evaluate potential acquisitions.
Human Capital Management
Our employees are our greatest asset and the foundation for our success. Together, we focus on building an inclusive culture
where innovative thinking is valued, collaboration is essential, and communicating the "why" is a necessity. We are committed
to creating a corporate culture characterized by high levels of employee engagement, growth and development, and health and
wellness. We seek to attract and retain talented professionals who provide a wide range of opinions and experiences to drive our
business forward. As of December 31, 2024, we have 101 full-time employees.
Our Human Capital strategy is focused on talent management. The basis for hiring, development, training, compensation and
advancement are qualifications, performance, skills and experience. We believe our employees are fairly compensated, without
regard to gender, race, and ethnicity. All of our employees are offered a comprehensive benefits package, including, but not
limited to, paid time off and parental leave, medical, dental and vision insurance, disability insurance, life insurance, 401(k)
matching, tuition reimbursement, flexible Fridays and remote work flexibility.
Employee engagement is critical to our success. We believe in fostering a highly engaged inclusive environment which drives
growth and productivity. We believe that our heightened focus on employee development and health and wellness creates a
more engaged workforce. In 2024, 90% of our employees were highly engaged and we were named one of Chicago's Top
Workplaces by The Chicago Tribune for the third year in a row. We believe that the more engaged our employees are the more
likely productivity will increase and drive empowerment throughout the organization for our employees to act like owners. Our
hybrid work model provides an opportunity for employees to balance work and life, whether in the office or at home. We also
host monthly events focused on employee education, health and wellness, engagement activities, and giving back to our
communities. Our events consist of company-wide executive-led meetings to stay connected with our employees, wellness
competitions, food trucks, game days, happy hours, and charity events serving our communities. We are proud that 100% of our
employees participated in charitable events giving back to our communities in 2024. Our Flexible Fridays program enables our
employees to balance work and life, focusing on mental health as well as giving back to our communities through charitable
endeavors.
We celebrate our employees' success through our Circle of Excellence awards. Our monthly, "On The Spot" award recognizes
employees who go above and beyond their job. Our annual awards, the "Rising Star" and "Standing Ovation", recognize new
employees and tenured employees who exhibit exceptional promise, ability, and our InvenTrust values. We monitor our
performance through employee engagement surveys and utilize the results to continually improve our organization.
2
Corporate Responsibility and Governance
We continue to manage matters of corporate responsibility and governance across our platform as part of our overall business
strategy. We believe that our efforts to enhance our communities, conserve resources, and foster a best-in-class work
environment are not just compatible with, but facilitative of, growing long-term stockholder value. We discuss such initiatives
related to our corporate responsibility and governance in our annual environmental, social, and governance ("ESG") report (the
"ESG Report") available on our website.
To date, compliance with federal, state, and local environmental laws has not had a material adverse effect on our business,
assets, results of operations, financial condition, and/or our ability to pay distributions. We do not believe that our existing retail
platform will require us to incur material expenditures to comply with these laws and regulations. However, we acknowledge
that compliance with environmental-related regulations and legislation is evolving, and we cannot predict the impact of new or
changed laws or regulations on our properties, operations, and financials.
Tax Status
We have elected and operate in a manner to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code
of 1986, as amended (the "Code"), beginning with the tax year ended December 31, 2005. To qualify as a REIT, we are
generally required to distribute at least 90% of our REIT taxable income (subject to certain adjustments) to our stockholders
each year. As a REIT, we are entitled to a tax deduction for some or all of the dividends paid to stockholders. Accordingly, we
are generally not subject to federal income taxes as long as we currently distribute to stockholders an amount equal to or in
excess of our taxable income. If we fail to qualify as a REIT in any taxable year, without the benefit of certain relief provisions,
we will be subject to federal and state income tax on our taxable income at regular corporate tax rates. Even if we qualify for
taxation as a REIT, we may be subject to certain state and local taxes on our income, property or net worth and federal income
and excise taxes on our undistributed income.
Our Website and Availability of SEC Reports and Other Information
The Company maintains a website at the following address: www.inventrustproperties.com. The information on the Company's
website is not incorporated by reference in this Annual Report or in any other report or document we file with the U.S.
Securities and Exchange Commission ("SEC"), and any references to our website are intended to be inactive textual references
only. In addition, we reference certain sources included on our website, including our ESG Report, in this Annual Report, and
none of these are incorporated by reference in, or are otherwise to be regarded as part of, this Annual Report.
We make available on or through our website certain reports and amendments to those reports we file with or furnish to the
SEC pursuant to Section 13(a) or 15(d) of the Exchange Act. These include our annual reports on Form 10-K, our quarterly
reports on Form 10-Q, and our current reports on Form 8-K. We make this information available on our website free of charge
as soon as reasonably practicable after we electronically file the information with, or furnish it to, the SEC. The SEC also
maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file
electronically with the SEC. The address of the site is http://www.sec.gov.
Investors and others should note that InvenTrust routinely announces material information to investors and the marketplace
using SEC filings, press releases, public conference calls, webcasts and the InvenTrust investor relations website. We also
intend to use certain social media channels as a means of disclosing information about us and our business to our colleagues,
customers, investors and the public (e.g., the InvenTrust X account (x.com/inventrustprop); and the InvenTrust LinkedIn
account (linkedin.com/company/inventrustproperties). The information posted on social media channels is not incorporated by
reference in this Annual Report or in any other report or document we file with the SEC. While not all of the information that
the Company posts to the InvenTrust investor relations website or to social media accounts is of a material nature, some
information could be deemed to be material. Accordingly, the Company encourages investors, the media, and others interested
in InvenTrust to review the information that it shares on the Company's investor relations website at inventrustproperties.com/
investor-relations, and regularly follow the Company's social media accounts.
3
Item 1A. Risk Factors
You should carefully consider each of the following risks described below and all of the other information in this Annual Report
in evaluating us. Our business, financial condition, cash flows, results of operations and/or ability to pay distributions to our
stockholders could be materially adversely affected by any of these risks. This Annual Report also contains forward-looking
statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these
forward-looking statements as a result of certain factors, including the risks faced by us described below and elsewhere in this
Annual Report.
Risk Factors Related to Our Business and Strategy
Economic, political and market conditions could negatively impact our business, results of operations and financial
condition.
Our business is affected by economic, political and market challenges experienced by the U.S. or global economies or the real
estate industry as a whole; by the regional or local economic conditions in the markets in which our assets are located, including
any dislocations in the credit markets; or by competitive business market conditions experienced by us. These conditions may
materially affect the value and the performance of our assets and our ability to sell assets, as well as our ability to make
principal and interest payments on, or refinance, outstanding debt when due.
An economic downturn could result in defaults by retail tenants, which could have an adverse impact on our business,
financial condition, results of operations, and ability to make distributions to our stockholders.
An economic downturn could have an adverse impact on the retail industry generally. Rising inflation could also adversely
impact consumer behavior and increase our and our tenants' operating costs. As a result, the retail industry could face further
reductions in sales revenues and increased bankruptcies. Adverse economic conditions may result in an increase in distressed or
bankrupt retail companies, which in turn would result in an increase in defaults by tenants at our commercial properties. Such
conditions may also affect shadow-anchor retailers in some of our centers, which we cannot control. Although we do not
generate revenue from shadow-anchor retailers, their presence drives traffic to some of our centers. Additionally, continued
slow or negative economic growth could hinder new entrants into the retail market, which may make it difficult for us to fully
lease our real properties. Tenant defaults and decreased demand for retail space would have an adverse impact on the value of
our retail properties and our results of operations.
A consumer shift in retail shopping from brick-and-mortar stores to e-commerce may have an adverse impact on our
revenues and cash flow.
The majority of national retailers operating brick-and-mortar stores have made e-commerce sales an important part of their
business model. The shift to e-commerce sales may adversely impact their sales for brick-and-mortar stores, causing those
retailers to adjust the size or number of retail locations in the future. This shift could adversely impact our occupancy and rental
rates, which would, in turn, adversely impact our revenues and cash flows.
Our retail portfolio is subject to geographic concentration, which exposes us to changing economic and retail market
conditions that may reduce our revenues and cash flows.
As of December 31, 2024, approximately 38.5% of the total annualized base rental income in our retail portfolio was generated
by properties located in Texas, with 16.1%, 10.2%, 9.0%, and 3.2% of our total annualized base rental income generated by
properties in Austin, Houston, Dallas-Fort Worth-Arlington, and San Antonio metropolitan areas, respectively. An oversupply
of retail properties without corresponding increases in demand or an economic downturn in some of these markets could have a
material adverse effect on our financial condition, our results of operations and our ability to pay distributions.
Our success depends on the success and continued presence of our anchor tenants.
Our properties are largely dependent on the operational success of their anchor tenants (those occupying 10,000 square feet or
more). Anchor tenants occupy significant 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 consumers to a property. Our net income could be adversely affected
by the loss of revenues in the event a significant tenant becomes bankrupt or insolvent, experiences a downturn in its business,
materially defaults on its leases, does not renew its leases as they expire, or renews at a lower rental rate. Any of these events
could result in a reduction or cessation in rental payments to us, which would adversely affect our financial condition and
results of operations. In addition, if a significant tenant vacates a property or terminates a lease, co-tenancy clauses may allow
other tenants to modify or abate their minimum rent, reduce their share or the amount of payments for common area operating
expenses and property taxes, or terminate their rent or lease obligations. Co-tenancy clauses have several variants and may
allow a tenant to pay reduced levels of rent until a certain number of tenants open their stores within the same property.
4
If our small shop tenants (tenants occupying less than 10,000 square feet) are not successful and, consequently, terminate
their leases, our cash flow, financial condition and results of operations could be adversely affected.
As of December 31, 2024, approximately 58.4% of our total annualized base rental income is generated by our small shop
tenants. Our small shop tenants may be more vulnerable to negative economic conditions as they generally have more limited
resources than our anchor tenants. If a significant number of our small shop tenants experience financial difficulties or are
unable to remain open, our cash flow, financial condition and results of operations could be adversely affected.
Our financial condition may be impacted by our ability to timely re-lease our space.
Our business and financial condition depend on the financial stability of our tenants and our ability to lease our space. Certain
economic conditions, or center specific conditions may adversely affect one or more of our tenants. Among the factors that
could impact our financial conditions are the following:
•
inability to renew, lease vacant space or re-let space as leases expire;
•
restrictions related to re-leasing space;
•
co-tenancy constraints which limit our ability to lease to certain operators or reduce our revenues at our properties if
co-tenancy clauses are exercised and;
•
competition for tenancy of our leases.
As of December 31, 2024, economic occupancy and leased occupancy of our retail portfolio was 95.3% and 97.4%,
respectively. Additionally, as of December 31, 2024, leases representing approximately 6.6% and 9.5% of our total expiring
GLA and $12.5 million and $24.2 million of our total expiring ABR were scheduled to expire in 2025 and 2026, respectively.
We cannot assure our stockholders that leases will be renewed or that our properties will be re-leased on terms equal to or better
than the current terms, or at all. We also may not be able to lease space which is currently not occupied on acceptable terms and
conditions, if at all. In addition, some of our tenants have leases that include early termination provisions that permit the lessee
to terminate all or a portion of its lease with us after a specified date or upon the occurrence of certain events with little or no
liability to us. We may be required to offer substantial rent abatements, tenant improvements, early termination rights or below-
market renewal options to retain these tenants or attract new ones. Portions of our assets may remain vacant for extended
periods of time. If the rental rates for our assets decrease, our existing tenants do not renew their leases or we do not re-lease a
significant portion of our available space and space for which leases will expire, our financial condition, cash flows and results
of operations could be adversely affected.
Many of our costs and expenses associated with operating our properties may remain constant or increase, even if our lease
income decreases.
Certain costs and expenses associated with our operating our properties, such as real estate taxes, insurance, utilities and
common area expenses, generally do not decrease in the event of reduced occupancy or rental rates, non-payment of rents by
tenants, general economic downturns, pandemics or other similar circumstances. In fact, in some cases, such as real estate taxes
and insurance, they may actually increase despite such events. As such, we may not be able to lower the operating expenses of
our properties sufficiently to fully offset such circumstances and may not be able to fully recoup these costs from our tenants. In
such cases, our cash flows, operating results and financial performance may be adversely impacted.
Pandemics, epidemics or other health crises may have a negative effect on our and our tenants' businesses, financial
condition, results of operations, cash flows, and liquidity.
Our business, and the businesses of our tenants, could be materially and adversely affected by the risks, or the public perception
of the risks, related to a pandemic, epidemic, or other health crisis, especially if there is a negative impact to customers'
willingness or ability to frequent our tenants' businesses.
Such crises could cause significant disruptions to the United States and global economy and contribute to significant volatility
and negative pressure in financial markets. Government responses, including quarantines, restrictions on travel, mandatory
closures of businesses, or other restrictions, as well as changes in consumer behavior, could negatively impact our tenants and
their ability to operate their businesses, which could impact our ability to collect on current or past due rent payments or fully
recover amounts due under the terms of a lease agreement in the event of a default by a tenant.
The unpredictable nature of pandemics, epidemics, and other health crises precludes any prediction as to one's ultimate adverse
impact. A worsening of the economic, political and social environment as a result presents material risks and uncertainties with
respect to our and our tenants' business, financial condition, results of operations, cash flows, liquidity, and ability to satisfy
debt service obligations.
5
Risk Factors Related to Real Estate Investments
There are inherent risks with investments in retail real estate.
Investments in real estate are subject to varying degrees of risk. Among the factors that could have a negative impact on our
assets and the value of an investment in us are the following:
•
relative illiquidity of real estate;
•
competition among other owners of commercial real estate for investments in similar markets;
•
expansion into new markets that we are not as familiar with;
•
changing market demographics;
•
risks associated with the possibility that cost increases will outpace revenue increases and that in the event of an
economic slowdown, the high proportion of fixed costs will make it difficult to reduce costs to the extent required to
offset declining revenues;
•
changes in tax laws and property taxes, or an increase in the assessed valuation of an asset for real estate tax purposes;
•
adverse changes in the federal, state or local laws and regulations applicable to us, including those affecting zoning,
fuel and energy consumption, water and environmental restrictions, and the related costs of compliance;
•
an inability to finance real estate assets on favorable terms, if at all;
•
significant capital expenditures may be required to improve our properties to attract tenants;
•
the ongoing need for owner-funded capital for improvements and expenditures to maintain or upgrade assets, make
tenant improvements and pay leasing commissions;
•
fluctuations in real estate values or potential impairments in the value of our assets;
•
natural disasters, such as hurricanes, wildfires, earthquakes, droughts, floods, extreme storms and weather or other
under-insured or uninsured losses, which may result from or be exacerbated by climate change, and man-made events,
such as terrorist attacks or events of sabotage;
•
changes in interest rates and availability, and cost and terms of financing; and
•
rising inflation.
We face risks with the expansion, development, and re-development of properties.
We seek to expand, develop and re-develop some of our existing properties and such activity is subject to various risks. We
may not be successful in identifying and pursuing expansion, development and re-development opportunities. In addition, like
newly-acquired properties, expanded, developed and re-developed properties may not perform as well as expected. Risks
include the following:
•
we may be unable to lease developments to full occupancy on a timely basis;
•
the occupancy rates and rents of a completed project may not be sufficient to make the project profitable;
•
actual costs of a project may exceed original estimates, possibly making the project unprofitable;
•
delays in the development or construction process may increase our costs;
•
we may not be able to obtain, or may experience delays in obtaining necessary zoning, land use, building, occupancy
and other required governmental permits and authorizations;
•
we may abandon a development project and lose our investment;
•
the size of our development pipeline may strain our labor or capital capacity to complete developments within targeted
timelines and may reduce our investment returns;
•
a reduction in the demand for new retail space may reduce our future development activities, which in turn may reduce
our net operating income; and
•
changes in the level of future development activity may adversely impact our results from operations by reducing the
amount of certain internal overhead costs that may be capitalized.
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Inflationary pressures, rising interest rates, supply chain disruptions, and labor shortages may exacerbate certain of these risks.
If we fail to reinvest in our properties or maintain their attractiveness to retailers and consumers, if our capital improvements are
not successful, or if retailers or consumers perceive that shopping at other venues (including e-commerce) is more convenient,
cost-effective, or otherwise more compelling, our financial condition, cash flows, and results of operations could be adversely
affected.
Our ongoing strategy depends, in part, upon completing future acquisitions and dispositions, and we may not be successful
in identifying attractive acquisition opportunities and consummating these transactions.
As part of our strategy, we intend to tailor and grow our retail platform. We cannot assure our stockholders that we will be able
to identify opportunities or complete transactions on commercially reasonable terms or at all, or that we will actually realize any
anticipated benefits from such acquisitions or investments. There may be high barriers to entry in many key markets and
scarcity of available acquisition and investment opportunities in desirable locations. We face significant competition for
attractive investment opportunities from an indeterminate number of other real estate investors, including investors with
significant capital resources such as domestic and foreign corporations and financial institutions, sovereign wealth funds, public
and private REITs, private institutional investment funds, domestic and foreign high-net-worth individuals, life insurance
companies and pension funds. As a result of competition, we may be unable to acquire additional properties as we desire or the
purchase price may be significantly elevated. Similarly, we cannot assure our stockholders that we will be able to obtain
financing for acquisitions or investments on attractive terms or at all, or that the ability to obtain financing will not be restricted
by the terms of our credit facility or other indebtedness we may incur.
Additionally, we regularly review our business to identify properties or other assets that we believe may not benefit us as much
as properties in other markets or with different characteristics. One of our strategies is to selectively dispose of retail properties
and use sale proceeds to fund our growth in markets and with properties that will enhance our retail platform. We cannot assure
our stockholders that we will be able to consummate any such sales on commercially reasonable terms or at all, or that we will
actually realize any anticipated benefits from such sales. Additionally, we may be unable to successfully identify attractive and
suitable replacement assets even if we are successful in completing such dispositions. We may face delays in reinvesting net
sales proceeds in new assets, which would impact the return we earn on our assets. Dispositions of real estate assets can be
particularly difficult in a challenging economic environment when uncertainties exist about the impact of e-commerce on
retailers and when financing alternatives are limited for potential buyers. Our inability to sell assets, or to sell such assets at
attractive prices, could have an adverse impact on our ability to realize proceeds for reinvestment. In addition, even if we are
successful in consummating sales of selected retail properties, such dispositions may result in losses.
Any such acquisitions, investments or dispositions could also demand significant attention from management that would
otherwise be available for our regular business operations, which could harm our business.
We may obtain only limited warranties when we purchase a property and would have only limited recourse if our due
diligence did not identify issues that could decrease the value of our property after the purchase.
The seller of a property often sells the property to us in its "as is" condition on a "where is" basis and "with all faults," without
any warranties of merchantability or fitness for a particular use or purpose. In addition, purchase agreements may contain only
limited warranties, representations and indemnifications that will only survive for a limited period after the closing. The
purchase of properties with limited warranties increases the risk that we may lose some or all of our invested capital in the
property, as well as the loss of rental income from that property, and may also require additional investment to make the
property suitable and competitive.
Our assets may be subject to impairment charges that may materially and adversely affect our financial results.
Economic and other conditions may adversely impact the valuation of our assets, resulting in impairment charges that could
have a material adverse effect on our results of operations. On a regular basis, we evaluate our assets for impairments based on
various factors, including changes in the holding periods, projected cash flows of such assets and market conditions.
If we determine that an impairment has occurred, we would be required to make an adjustment to the net carrying value of the
asset, which could have a material adverse effect on our results of operations in the accounting period in which the adjustment
is made. Furthermore, changes in estimated future cash flows due to a change in our plans, policies, or views of market and
economic conditions could result in the recognition of additional impairment losses for already impaired assets, which, under
the applicable accounting guidance, could be substantial and could materially adversely affect our results of operations. We
have incurred and we may incur future impairment charges, which could be material.
7
Risk Factors Related to the Environment Affecting Our Properties
Geographic concentration makes our business more vulnerable to natural disasters, severe weather, and climate change.
Natural disasters and severe weather such as hurricanes, wildfires, earthquakes, mudslides, droughts, tornadoes, blizzards,
hailstorms or floods may result in significant damage to our properties, decrease demand for certain properties, disrupt
operations at our properties, increase the costs associated with maintaining or insuring our properties, and adversely affect both
the value of our properties and the ability of our tenants and operators to make their scheduled rent payments to us. The extent
of our casualty losses and loss in operating income in connection with such events is a function of the severity of the event and
the total amount of exposure in the affected area. These losses may not be insured or insurable at commercially reasonable
rates. When we have a geographic concentration, a single catastrophe or destructive weather event affecting a region may have
a significant negative effect on our financial condition, results of operations, and cash flows. As a result, our operating and
financial results may vary significantly from one period to the next. We also are exposed to the risk of an increased need for the
maintenance and repair of our buildings due to inclement or extreme weather.
Moreover, climate change may adversely impact our properties directly, such as through increasing the frequency/severity of
natural disasters or by chronic changes to weather patterns and the environment that impact the desirability of particular
locations, and may lead to additional compliance obligations and costs, including insurance premiums, taxes and fees. Changes
in federal, state and local legislation and regulation, or in other stakeholder expectations, on climate change could result in
increased operating costs (for example, increased utility costs) and/or increased capital expenditures to improve the energy
efficiency of our existing properties (for example, increased costs associated with meeting electric vehicle charging mandates)
and could also require us to spend more on our new properties without a corresponding increase in revenue and could increase
our exposure to new physical risks and liabilities.
Risk Factors Related to Funding Strategies and Capital Structure
Our debt financing may adversely affect our business and financial condition.
Our existing and future debt may subject us to many risks, including the risks that:
•
our cash flow from operations will be insufficient to make required payments of principal and interest;
•
our debt may increase our vulnerability to adverse economic and industry conditions;
•
we may be required to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby
reducing cash available for distribution to our stockholders, funds available for operations and capital expenditures,
future business opportunities or other purposes;
•
the terms of any refinancing may not be as favorable as the terms of the debt being refinanced; and
•
the terms of our debt may limit our ability to make distributions to our stockholders and therefore adversely affect the
market price of our stock.
In the past, we have refinanced our debt and relied on debt financing to, among other things, fund our operations, future
investment activities and acquisitions and business growth and repay maturing debt. If we do not have sufficient funds to repay
our debt at maturity, it may be necessary to refinance this debt through additional debt financing, or private or public offerings
of debt or equity securities. Adverse economic conditions could cause the terms on which we borrow or refinance to be
unfavorable. If we are unable to refinance our debt on acceptable terms, we may be forced to dispose of assets on
disadvantageous terms or at times which may not permit us to receive an attractive return on our investments, potentially
resulting in losses adversely affecting cash flow from operating activities.
Covenants in our debt agreements may restrict our operating activities and adversely affect our financial condition.
Our debt agreements contain various financial and operating covenants, including, among other things, certain coverage ratios
and limitations on our ability to incur secured and unsecured debt. The breach of any of these covenants, if not cured within any
applicable cure period, could result in a default and acceleration of certain of our indebtedness. If any of our indebtedness is
accelerated prior to maturity, we may not be able to repay or refinance such indebtedness on favorable terms, or at all, which
could adversely affect our financial condition, operating results and cash flows.
8
Increases in interest rates would cause our borrowing costs to rise and negatively impact our results of operations.
As fixed-rate debt matures, we may not be able to borrow at rates equal to or lower than the rates on the expiring debt. In
addition, if rising interest rates cause us to need additional capital to repay indebtedness, we may be forced to sell one or more
of our properties or investments in real estate at times that may not permit us to realize the return on the investments we would
have otherwise realized.
Increases in interest rates would increase our interest expense on any variable rate debt, as well as any debt that must be
refinanced at higher interest rates at the time of maturity. Our future earnings and cash flows could be adversely affected due to
the increased requirement to service our debt and could reduce the amount we are able to distribute to our stockholders.
Hedging activity may expose us to risks, including the risks that a counterparty will not perform and that the hedge will not
yield the economic benefits we anticipate, which may adversely affect us.
We manage our exposure to interest rate volatility by using interest rate hedging arrangements. These arrangements involve
risk, such as the risk that counterparties may fail to honor their obligations under these arrangements, and that these
arrangements may not be effective in reducing our exposure to interest rate changes. There can be no assurance that our hedging
arrangements will qualify for hedge accounting or that our hedging activities will have the desired beneficial impact on our
results of operations. Should we desire to terminate a hedging arrangement, there may be significant costs and cash
requirements involved to fulfill our obligations under the hedging arrangement. In addition, failure to effectively hedge against
interest rate changes may adversely affect our results of operations.
We may issue additional equity or debt securities in the future in order to raise capital. Additional issuances of equity
securities would dilute the investment of our current stockholders and could decrease the market price of our common stock.
Issuing additional equity securities to finance future developments and acquisitions instead of incurring additional debt would
dilute the interests of our existing stockholders. Further, a large volume of sales of shares of our common stock would decrease
the market price of our common stock and could impair our ability to raise additional capital through the sale of equity
securities in the future. Our ability to execute our business and growth plan depends on our access to an appropriate blend of
capital, which could include a line of credit and other forms of secured and unsecured debt, equity financing, or joint ventures.
Stockholders do not have preemptive rights with respect to any shares issued by us in the future. Therefore, additional common
stock issuances, directly or through convertible or exchangeable securities, warrants or options, will dilute the holdings of our
existing common stockholders and such issuances or the perception of such issuances may reduce the market price of our
common stock. Our charter authorizes our board of directors (the "Board"), without stockholder approval, to amend the charter
from time to time to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class
or series that the Company has authority to issue. Stockholders are not entitled to vote on whether or not we issue additional
shares. Because our decision to issue debt or equity securities or incur other or additional borrowings in the future will depend
on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, nature, impact or
success of our future capital raising efforts. Thus, common stockholders bear the risk that our future issuances of debt or equity
securities or our incurrence of other or additional borrowings will negatively affect the market price of our common stock and
adversely impact our financial condition, liquidity and results of operations.
Risk Factors Related to the Market Price for Our Securities
Changes in economic and market conditions may adversely affect the market price of our securities.
The market price of our equity securities may fluctuate significantly in response to many factors, many of which are out of our
control, including:
•
actual or anticipated variations in our operating results, liquidity or financial condition;
•
changes in our earnings estimates or failure to meet earnings estimates;
•
changes in our funds from operations;
•
increases in market interest rates that drive purchasers of our stock to demand a higher dividend yield;
•
changes in market valuations of similar companies;
•
adverse market reaction to any additional debt we incur in the future;
•
additions or departures of key management personnel;
9
•
the general reputations of REITs and the attractiveness of equity securities in comparison to other equity securities
including securities issued by other real estate based companies;
•
our underlying asset value;
•
strategic actions by the Company or our competitors, such as acquisitions, dispositions or restructurings;
•
fluctuations in the stock price and operating results of the Company's competitors;
•
the passage of legislation or other regulatory developments that may adversely affect the Company or the REIT
industry, including but not limited to Section 1031 of the Code;
•
investor confidence in the stock and bond markets generally;
•
changes in tax laws or accounting principles;
•
publication of research reports about us or the real estate industry in general and recommendations by financial
analysts or actions taken by rating agencies with respect to our securities or those of other REITs;
•
future equity issuances or the perception that such equity issuances may occur;
•
failure to maintain our status as a REIT;
•
actions by institutional stockholders or by corporate governance rating companies;
•
increased investor focus on sustainability-related risks, including climate change;
•
changes in our dividend payments; and
•
general market and economic conditions, including factors unrelated to the Company's operating performance.
These factors may cause the market price of our securities to decline, regardless of our financial condition, results of operations,
business or prospects. It is impossible to ensure that the market price of our securities, including our common stock, will not fall
in the future. A decrease in the market price of our common stock may reduce our ability to raise additional equity in the public
markets. Selling common stock at a decreased market price would have a dilutive impact on existing stockholders.
There is no assurance that we will continue to pay dividends.
Our ability to continue to pay dividends will depend on a number of factors, including, among others, the following:
•
our financial condition and results of future operations;
•
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 the dividend on our common stock, it may have an adverse effect on the market price of our common
stock and other securities.
Funding distributions from sources other than cash flow from operating activities may negatively impact our ability to
sustain or pay future distributions.
If our cash flow from operating activities is not sufficient to fully fund the payment of distributions, the level of our
distributions may not be sustainable.
We may pay distributions from sources other than cash flow from operations or funds from operations, including funding such
distributions from external financing sources, which may not be available at commercially attractive terms. Furthermore, in the
event that we are unable to fund future distributions from our cash flows from operating activities, the value of our
stockholders' shares may be materially adversely affected.
For the year ended December 31, 2024, distributions were paid from cash flow from operations and proceeds from the sales of
properties.
10
Risk Factors Related to Our Organization and Corporate Structure
Our charter permits our Board to issue preferred stock on terms that may subordinate the rights of the holders of our
current common stock or discourage a third party from acquiring us.
Our Board may classify or reclassify any unissued shares of common or preferred stock into other classes or series of stock and
establish the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends and other
distributions, qualifications, and terms or conditions of redemption of the stock and may amend our charter from time to time to
increase or decrease the aggregate number of shares or the number of shares of any class or series that we have authority to
issue without stockholder approval. Thus, our Board could authorize us to issue shares of preferred stock with terms and
conditions that could subordinate the rights of the holders of our common stock or shares of preferred stock or common stock
that could have the effect of delaying, deferring or preventing a change in control of us, including an extraordinary transaction
such as a merger, tender offer or sale of all or substantially all of our assets, that might provide a premium price for holders of
our common stock.
Our Board or a committee of our Board may change our investment policies without stockholder approval, which could alter
the nature of our stockholders' investment.
Our investment policies may change over time. The methods of implementing our investment policies may also vary, as new
investment techniques are developed. Our investment policies, the methods for implementing them, and our other objectives,
policies and procedures may be altered by our Board or a committee of our Board without the approval of our stockholders. As
a result, the nature of our stockholders' investment could change without their consent. A change in our investment strategy
may, among other things, increase our exposure to interest rate risk, default risk and real property market fluctuations, all of
which could materially and adversely affect our ability to achieve our investment objectives.
Risk Factors Related to Corporate Matters
We are subject to litigation that could negatively impact our cash flow, financial condition and results of operations.
We are a defendant from time to time in lawsuits and regulatory proceedings relating to our business. Due to the inherent
uncertainties of litigation and regulatory proceedings, we may not be able to accurately predict the ultimate outcome of any
such litigation or proceedings. A significant unfavorable outcome could negatively impact our cash flow, financial condition
and results of operations.
Uninsured losses or premiums for insurance coverage may adversely affect a stockholder's returns.
We maintain insurance coverage with third-party carriers who provide a portion of the coverage of potential losses, including
wind, flood, named windstorm, earthquake, fire, and other property-related perils. We currently self-insure a portion of our
commercial insurance deductible risk through our captive insurance company. To the extent that our captive insurance company
is unable to bear that risk, we may be required to fund additional capital to our captive insurance company or we may be
required to bear that loss. Further, there are losses we may incur that cannot be insured against or that we believe are not
economically reasonable to insure. Should an uninsured loss occur, we could lose all or a portion of the capital we have
invested in a property, as well as the anticipated future cash flow from the property.
Catastrophic losses, including, but not limited to, hurricanes, wildfires, windstorms, earthquakes, floods, and foreign terrorist
activities may not be insurable or may not be economically insurable. Even when insurable, these policies may have high
deductibles and/or high premiums. Lenders may require such insurance. Our failure to obtain such insurance could constitute a
default under loan agreements, and/or our lenders may force us to obtain such insurance at unfavorable rates, which could
materially and adversely affect our profitability.
In the event of a substantial loss, our insurance coverage may not be sufficient to cover the full current market value or
replacement cost of our lost investment. Should an uninsured loss or a loss in excess of insured limits occur, we could lose all
or a portion of the capital we have invested in an asset, as well as the anticipated future cash flows from the asset. In that event,
we might nevertheless remain obligated for any mortgage debt or other financial obligations related to the asset. Inflation,
changes in building codes and ordinances, environmental considerations and other factors might require us to come out of
pocket to replace or renovate an asset after it has been damaged or destroyed. Under those circumstances, the insurance
proceeds we receive might be inadequate to restore our economic position on the damaged or destroyed property, which could
materially and adversely affect our profitability.
In addition, insurance risks associated with potential terrorist acts could sharply increase the premiums we pay for coverage
against property and casualty claims.
11
We could incur material costs related to government regulation and litigation with respect to environmental matters, which
could materially and adversely affect our revenues and profitability.
Under various federal, state, and local laws, an owner or manager of real property may be liable for the costs to assess and
remediate the presence of hazardous substances on the property, which in our case generally arise from former dry cleaners, gas
stations, asbestos usage, storage tanks, air emissions from emergency generators, storm water and wastewater discharges, lead-
based paint, mold and mildew, waste management, and historic land use practices. These laws often impose liability without
regard to whether the owner knew of, or was responsible for, the presence of hazardous substances. The presence of, or the
failure to properly address the presence of, hazardous substances may adversely affect our ability to sell or lease the property or
borrow using the property as collateral. We can provide no assurance that we are aware of all potential environmental liabilities
or their ultimate cost to address; that our properties will not be affected by tenants or nearby properties or other unrelated third
parties; and that future uses or conditions, or changes in environmental laws and regulations, or their interpretation, will not
result in additional material environmental liabilities to us.
The discovery of material environmental liabilities at our assets could subject us to unanticipated significant costs, which could
significantly reduce or eliminate our profitability and the cash available for distribution to our stockholders.
Moreover, compliance with ESG-related laws, regulations, expectations or reporting requirements may result in increased
compliance costs, as well as additional scrutiny that could heighten all of the risks associated with environmental, social and
sustainability matters. If we fail to comply with new laws, regulations, expectations or reporting requirements, or if we are
perceived as failing, our reputation and business could be adversely impacted. The occurrence of any of the foregoing could
have an adverse effect on the price of the Company's stock and the Company's business, financial condition and results of
operations, including increased development costs, capital expenditures and operating expenses.
If we lose or are unable to obtain and retain key personnel, our ability to implement our business strategies could be delayed
or hindered.
We believe that our future success depends, in large part, on our ability to retain and hire highly-skilled managerial and
operating personnel. Competition for persons with managerial and operational skills is intense, and we cannot assure our
stockholders that we will be successful in retaining or attracting skilled personnel. If we lose or are unable to obtain the services
of our executive officers and other key personnel, or we are unable to establish or maintain the necessary strategic relationships,
our ability to implement our business strategy could be delayed or hindered.
Corporate responsibility related to environmental, social and governance factors, may impose additional costs and expose us
to new risks.
There is continued scrutiny on companies’ management of climate change, human capital, and other environmental, social and
governance factors. Although the Company makes ESG disclosures and undertakes ESG initiatives, such initiatives are costly
and there is no assurance they will have the desired effects. For example, we may not be able to ultimately achieve certain of
our goals or initiatives due to cost, technology, or other factors which may or may not be within our control. Additionally, many
of these matters rely on methodologies and data that continue to evolve, and we cannot guarantee that any changes to our
approach will align with any stakeholder expectations or preferences. Stakeholders expectations are not uniform, and both
advocates for and opponents of ESG initiatives are increasingly resorting to a range of activism forms to achieve their goals.
Some policymakers have also adopted, or are considering adopting requirements related to ESG matters, but such requirements
are not uniform, which may increase costs or complexity for compliance, as well as related risk.
We may face reputational damage, litigation, or other risks in the event our corporate responsibility procedures or standards do
not successfully navigate the expectations of various constituencies. In addition, our competitors may receive more favorable
ratings or otherwise more successfully navigate competing stakeholder preferences. The occurrence of any of the foregoing
could have an adverse impact on our business, financial condition and results of operations, including increased capital
expenditures and operating expenses. Moreover, various of our customers and other stakeholders are subject to similar
expectations, which may augment or create additional risks for us.
If we or our third-party providers fail to protect confidential information and/or experience cyber-attacks, security problems,
or other disruptions, there may be damage to our brand and reputation, financial penalties, and legal liability, which could
materially adversely affect our business, results of operations, and financial condition.
A cyber incident is considered to be any adverse event that threatens the confidentiality, integrity or availability of our
computer systems, hardware, software, technology infrastructure and online sites and networks for both internal and external
operations that are critical to our business (collectively, "IT systems"). More specifically, a cyber incident is an intentional
attack or an unintentional event that can include an intruder gaining unauthorized access to systems to disrupt operations,
12
corrupt data or steal confidential information and threats from diverse threat actors, such as state-sponsored organizations,
opportunistic hackers and hacktivists, as well as through diverse attack vendors, such as social engineering/phishing, malware
(including ransomware), malfeasance by insiders, human or technological error, and as a result of bugs, misconfigurations or
exploited vulnerabilities in software or hardware. As our reliance on technology has increased, so have the risks posed to our
systems, both internal and those we have outsourced.
We and certain of our third-party providers collect, maintain and process data about customers, employees, business partners
and others, including personally identifiable information, as well as proprietary information belonging to our business such as
trade secrets (collectively, "Confidential Information"). There can be no assurance that our security efforts and measures will be
effective or that attempted security breaches would not be successful or damaging. While we maintain some of these IT
Systems, we also depend on third parties to provide important IT Systems relating to several key business functions.
Furthermore, the security measures employed by third-party service providers may prove to be ineffective at preventing
breaches of their systems. Moreover, cyber incidents perpetrated against our tenants, including unauthorized access to
customers' credit card data and other confidential information, could diminish consumer confidence and consumer spending and
negatively impact our business and reputation. Additionally, any integration of artificial intelligence ("AI"), machine learning
and automated decision-making technologies (collectively, "AI Technologies") in our or any service providers' operations,
products or services is expected to pose new or unknown cybersecurity risks and challenges.
Cyberattacks are expected to accelerate on a global basis in frequency and magnitude as threat actors are becoming increasingly
sophisticated in using techniques and tools - including, with increased frequency, generative and other AI Technologies - that
circumvent security controls, evade detection and remove forensic evidence. As a result, we, or our tenants, may be unable to
detect, investigate, remediate or recover from future attacks or incidents, or to avoid a material adverse impact to our IT
Systems, confidential information or business. Any adverse impact to the availability, integrity or confidentiality of our IT
Systems can result in legal claims or proceedings (such as class actions), regulatory investigations and enforcement actions,
fines and penalties, operational interruption, damage to our relationships with our tenants or damage to our tenants'
relationships with their customers, as applicable, and private data exposure. Our and our tenants' financial results and reputation
may be negatively impacted by such an incident.
There can be no assurance that our cybersecurity risk management program and processes, including our policies, controls or
procedures, will be fully implemented, complied with or effective in protecting our IT Systems and information. Further, we
cannot guarantee that any costs and liabilities incurred in relation to an attack or incident will be covered by our existing
insurance policies or that applicable insurance will be available to us in the future on economically reasonable terms or at all.
Any actual or perceived failure to comply with new or existing laws, regulations and other requirements relating to the
privacy, security and processing of personal information or AI Technologies could adversely affect our business, results of
operations, or financial condition.
In connection with running our business, we receive, store, use and otherwise process information that relates to individuals,
and we are therefore subject to laws, regulations and other requirements relating to the privacy, security and handling of
personal information. It is possible that new laws, regulations and other requirements, or amendments to or changes in
interpretations of existing laws, regulations and other requirements, may require us to incur costs, implement new processes, or
change our handling of information and business operations. In addition, any failure or perceived failure by us to comply with
laws, regulations and other requirements relating to the privacy, security and handling of information could result in legal
claims or proceedings (including class actions), regulatory investigations or enforcement actions. Any such proceedings and
subsequent adverse outcomes may subject us to significant negative publicity and an erosion of trust. If any of these events
were to occur, our business, results of operations, and financial condition could be materially adversely affected.
In addition, the regulatory framework for AI Technologies is rapidly evolving as many federal, state and foreign government
bodies and agencies have introduced or are currently considering additional laws and regulations. Existing laws and regulations
may be interpreted in ways that would affect our use of AI Technologies, or could be rescinded or amended as new
administrations take differing approaches to evolving AI Technologies. As a result, implementation standards and enforcement
practices are likely to remain uncertain for the foreseeable future, and we cannot yet completely determine the impact future
laws, regulations, standards, or market perception of their requirements may have on our business and may not always be able
to anticipate how to respond to these laws or regulations. Any such changes at the federal level could require us to expend
significant resources to modify our products, services, or operations to ensure compliance or remain competitive.
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Risk Factors Relating to Our Qualification as a REIT
Our failure to qualify as a REIT would have serious adverse consequences to our stockholders.
We plan to continue to meet the requirements for taxation as a REIT. Many of these requirements, for which there is limited
judicial and administrative interpretation, however, are highly technical and complex. Therefore, we cannot guarantee that we
have qualified or will qualify as a REIT in the future. The determination that we are a REIT requires an analysis of various
factual matters that may not be totally within our control. To qualify as a REIT, our assets must be substantially comprised of
real estate assets as defined in the Code, and related guidance and our gross income must generally come from rental and other
real estate or passive related sources that are itemized in the REIT tax laws. We are also required to distribute to security
holders at least 90% of our REIT taxable income excluding net capital gains.
If we fail to qualify as a REIT, we would be subject to U.S. federal income tax at regular corporate rates and would have to pay
significant income taxes unless the Internal Revenue Service ("IRS") granted us relief under certain statutory provisions. In
addition, we would remain disqualified from taxation as a REIT for four years following the year in which we failed to qualify
as a REIT. We would therefore have less money available for investments or for distributions to security holders and would no
longer be required to make distributions to security holders. This would likely have a significant negative impact on the value
of our securities.
We have a share ownership limit for REIT tax purposes.
In order to continue to qualify as a REIT, five or fewer individuals, as defined in the Code, may not own, beneficially or
constructively, more than 50% in value of our issued and outstanding stock at any time during the last half of a taxable year. To
facilitate maintenance of our REIT qualification, our Charter, prohibits ownership by any single stockholder of more than 9.8%
percent of the lesser of the number or value of any outstanding class of common. Our Board may not grant an exemption from
these restrictions to any proposed stockholder whose ownership in excess of the 9.8% stock ownership limit that would result in
our failing to qualify as a REIT. This ownership limit may delay or prevent a transaction or change in control that could affect
our stockholders' ability to realize a premium over the then prevailing market price for their shares, it could also restrict our
stockholders' ability to acquire or transfer certain amounts of our common stock.
Item 1B. Unresolved Staff Comments
None.
14
Item 1C. Cybersecurity
Cybersecurity Risk Management and Strategy
We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality,
integrity, and availability of our critical systems and information. Our cybersecurity risk management program includes a
cybersecurity incident response plan.
We design and assess our program based on the National Institute of Standards and Technology Cybersecurity Framework
("NIST CSF"). This does not imply that we meet any particular technical standards, specifications, or requirements, only that
we use the NIST CSF as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business.
Our cybersecurity risk management program is integrated into our overall enterprise risk management program, and shares
common methodologies, reporting channels, and governance processes that apply across the enterprise risk management
program to other legal, compliance, strategic, operational, and financial risk areas.
Our cybersecurity risk management program includes:
•
risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products,
services, and our broader enterprise IT environment;
•
a team responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our
response to cybersecurity incidents;
•
the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security
controls;
•
cybersecurity awareness training of our employees, incident response personnel, and senior management;
•
a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and
•
a risk management process for essential third-party service providers, suppliers, and vendors, as identified by
management.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that
have materially affected us, including our operations, business strategy, results of operations, or financial condition. We face
risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us, including our operations, business
strategy, results of operations, and/or financial condition. See "Part I, Item 1A. Risk Factors" contained in this Annual Report
for a discussion of the risks we face from cybersecurity threats.
Cybersecurity Governance
Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee (the
"Committee") oversight of cybersecurity and other information technology risks. The Committee oversees management's
implementation of our cybersecurity risk management program.
The Committee receives periodic reports from management on our cybersecurity risks. In addition, management updates the
Committee, as necessary, regarding any material cybersecurity incidents, as well as any incidents with lesser impact potential.
The Committee reports to the full Board regarding its activities, including those related to cybersecurity. The full Board also
receives briefings from management on our cybersecurity risk management program. Board members receive presentations on
cybersecurity topics from our Vice President of Information Technology ("VP IT") or external experts as part of the Board's
continuing education on topics that impact public companies.
Our VP IT, who reports to the Chief Financial Officer, is primarily responsible for assessing and managing our material risks
from cybersecurity, as well as our overall cybersecurity risk management program, including supervision of our retained
external cybersecurity consultants. Our management team has experience with implementing IT organizational policies and
procedures, working in multiple platform environments, and overseeing corporate networking and hardware framework.
Our VP IT and management team are informed about and monitor efforts to prevent, detect, mitigate, and remediate
cybersecurity risks and incidents through various means, which may include briefings from our internal team; threat intelligence
and other information obtained from governmental, public or private sources, including external consultants engaged by us; and
alerts and reports produced by security tools deployed in our IT environment.
15
Item 2. Properties
The following table summarizes our retail portfolio as of December 31, 2024 and 2023.
Year ended December 31
2024
2023
No. of properties
68
62
GLA (square feet)
10,972
10,324
Economic occupancy
95.3%
93.3%
Leased occupancy
97.4%
96.2%
ABR PSF
$20.07
$19.48
The following table summarizes the geographical diversity of our retail portfolio by ABR as of December 31, 2024.
Market
No. of
Properties
ABR
ABR PSF
ABR as
% of Total
GLA
GLA as
% of Total
Austin-Round Rock, TX
8
$
33,517
$16.97
16.1 %
2,091
19.1 %
Houston-Sugar Land-Baytown, TX
6
21,376
16.41
10.2 %
1,378
12.5 %
Atlanta Metro Area, GA
10
20,935
20.89
10.0 %
1,069
9.7 %
Miami-Fort Lauderdale-Miami Beach, FL
3
20,231
24.04
9.7 %
859
7.8 %
Dallas-Fort Worth-Arlington, TX
7
18,678
20.56
9.0 %
941
8.6 %
Raleigh-Cary-Durham, NC
5
13,288
20.39
6.4 %
688
6.3 %
Orlando-Kissimmee, FL
4
10,337
25.67
5.0 %
411
3.7 %
Charlotte-Gastonia-Concord, NC
4
9,972
20.67
4.8 %
515
4.7 %
Tampa-St. Petersburg, FL
3
9,486
15.34
4.6 %
744
6.8 %
So. California - Los Angeles, CA
2
7,489
20.14
3.6 %
392
3.6 %
Richmond, VA
2
6,864
17.94
3.3 %
385
3.5 %
San Antonio, TX
2
6,573
27.02
3.2 %
261
2.4 %
Washington D.C., MD
2
5,826
36.34
2.8 %
181
1.6 %
So. California - San Diego, CA
2
5,712
26.31
2.8 %
225
2.1 %
So. California - Inland Empire, CA
2
5,661
23.36
2.7 %
246
2.2 %
Charleston-Berkeley-Dorchester, SC
2
5,225
25.80
2.5 %
214
2.0 %
Cape Coral-Fort Myers, FL
2
3,718
15.55
1.8 %
249
2.3 %
Phoenix, AZ
2
3,057
25.73
1.5 %
123
1.1 %
Total
68
$
207,945
$20.07
100 %
10,972
100 %
The following table presents information regarding the top 10 tenants of our retail portfolio by ABR as of December 31, 2024.
Parent Name
Tenant Name/Count
No. of
Leases
ABR
% of Total
ABR
GLA
% of Total
Occ.GLA
Kroger
Kroger 7 / Kroger Gas 1 / Harris Teeter 4 /
Ralphs 2
14
$
8,891
4.3 %
821
7.5 %
Publix Super Markets, Inc.
Publix 12 / Publix Liquor 3
15
6,926
3.3 %
581
5.3 %
TJX Companies
Marshalls 7 / HomeGoods 5 / TJ Maxx 2
14
4,907
2.4 %
399
3.6 %
Albertson's
Tom Thumb 2 / Market Street 2 / Safeway 1 /
Albertsons 1
6
4,359
2.1 %
365
3.3 %
H.E.B.
H.E.B. 4 / H.E.B. Staff Office 1
5
4,257
2.0 %
447
4.1 %
Amazon, Inc.
Whole Foods Market 5
5
2,742
1.3 %
194
1.8 %
Apollo Global
Management, Inc.
Michael's 8
8
2,660
1.3 %
190
1.7 %
Best Buy
4
2,270
1.1 %
138
1.3 %
Ross Dress For Less
Ross Dress for Less 5 / dd's Discounts 1
6
2,193
1.1 %
171
1.6 %
BC Partners
PetSmart 6
6
2,117
1.0 %
125
1.1 %
83 $ 41,322
19.9 %
3,431
31.3 %
16
The following table presents the lease expirations of our retail portfolio as of December 31, 2024. This table does not include
expirations of signed but not yet commenced leases, nor does it assume available but unexercised contractual lease renewal or
extension options contained in our leases.
Lease
Expiration Year
No. of
Expiring
Leases
GLA of
Expiring Leases
Percent of
Total GLA of
Expiring Leases
ABR of
Expiring Leases
Percent of
Total ABR
Expiring
ABR PSF (a)
2025
137
697
6.6 % $
12,522
5.6 %
$17.97
2026
231
1,000
9.5 %
24,231
10.9 %
24.23
2027
286
1,883
17.9 %
38,609
17.3 %
20.50
2028
238
1,111
10.7 %
26,712
12.0 %
24.04
2029
241
1,487
14.2 %
32,612
14.6 %
21.93
2030
133
937
8.9 %
20,027
9.0 %
21.37
2031
89
581
5.5 %
12,337
5.5 %
21.23
2032
89
543
5.2 %
12,233
5.5 %
22.53
2033
69
435
4.1 %
10,789
4.8 %
24.80
2034
84
768
7.3 %
15,599
7.0 %
20.31
Thereafter
46
1,032
9.9 %
16,493
7.5 %
15.98
Other (b)
11
22
0.2 %
598
0.3 %
27.18
Totals
1,654
10,496
100 % $
222,762
100 %
$21.22
(a)
Expiring ABR PSF reflects ABR PSF at the time of lease expiration.
(b)
Other lease expirations include the GLA, ABR and ABR PSF of month-to-month leases.
Our retail business is neither highly dependent on specific retailers nor subject to lease roll-over concentration. We believe this
minimizes our risk of significant revenue variances over time.
Certain of our properties are encumbered by mortgages, totaling $93.4 million as of December 31, 2024. Additional detail about
our retail properties can be found on Schedule III – Real Estate and Accumulated Depreciation.
Item 3. Legal Proceedings
We are subject, from time to time, to various legal proceedings and claims that arise in the ordinary course of business. While
the resolution of these matters cannot be predicted with certainty, we believe, based on currently available information, that the
final outcome of such matters will not have a material adverse effect on our financial condition, results of operations, or
liquidity.
Item 4. Mine Safety Disclosures
Not applicable.
PART II
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities.
Market Information
Our common stock trades on the NYSE under the ticker symbol "IVT". As of February 6, 2025, there were 20,175 holders of
record of shares of our outstanding common stock.
In order to comply with certain requirements related to our qualification as a REIT, our charter, subject to certain exceptions,
contains restrictions on the number of shares of our common stock that a person may own. Our charter provides that no person
may beneficially or constructively own more than 9.8% in value or in number of shares, whichever is more restrictive, of the
outstanding shares of any class or series of our capital stock.
17
Issuer Purchases of Equity Securities
Share Repurchase Program
On February 23, 2022, we established a share repurchase program (the "SRP") of up to $150.0 million of our outstanding shares
of common stock. The SRP may be suspended or discontinued at any time, and does not obligate us to repurchase any dollar
amount or particular amount of shares. As of December 31, 2024, no common stock has been repurchased under the SRP.
Stock-Based Compensation Plans
During the year ended December 31, 2024, certain of the Company's employees surrendered shares of common stock to satisfy
tax withholding obligations associated with the vesting of shares of common stock issued under the InvenTrust Properties Corp.
2015 Incentive Award Plan, as amended (the "Incentive Award Plan"), and the purchase of shares of common stock at a
discount under the InvenTrust Properties Corp. 2023 Employee Stock Purchase Plan (the "ESPP").
The following table summarizes all share repurchases during the fourth quarter of 2024:
Period
Total No. of
Shares Purchased (a)
Average Price
Paid per Share
Total No. of Shares
Purchased as Part of
Publicly Announced
Plans or Programs
Approx. Dollar Value of
Shares that May Yet Be
Purchased Under the
Plans or Programs
October 1 - October 31, 2024
—
$—
—
$150,000
November 1 - November 30, 2024
—
$—
—
$150,000
December 1 - December 31, 2024
46,630
$29.71
—
$150,000
(a)
Consists of shares of common stock surrendered to the Company to satisfy tax withholding obligations associated with the vesting of
restricted stock unit awards under our Incentive Award Plan.
Distributions
We have paid cash distributions since October 2005. Our quarterly distributions are paid one quarter in arrears. Any future
determination to pay distributions will be at the discretion of our Board and will depend on our financial condition, capital
requirements, restrictions contained in current or future financing instruments, and such other factors as our Board deems
relevant. We currently have capacity and intend to continue to pay a quarterly distribution, subject to Board approval.
During the year ended December 31, 2024, we declared and paid cash distributions of $65.7 million and $62.8 million,
respectively. During the year ended December 31, 2023, we declared and paid cash distributions of $58.2 million and $57.5
million, respectively.
For the distribution of $0.2155 declared on December 28, 2023 and paid on January 15, 2024, $0.1125 of the distribution is
reported for the tax year 2024 and included in the tax characterization percentages in the table below. The December 2024
distribution declared, with a record date of December 30, 2024 and payment date of January 15, 2025, will be reported in 2025,
and is not reflected in the 2024 tax allocation.
The tax characterization of our distributions declared for the years ended December 31, 2024 and 2023 was as follows:
Year ended December 31
Common Stock:
2024
2023
Ordinary distributions
95.55%
78.50%
Other forms of distributions
4.45%
—%
Capital gain distributions
—%
21.50%
Total distributions per share of common stock
100.00%
100.00%
18
Stock Performance Graph
The following performance graph and related information shall not be deemed “soliciting material” or to be “filed” with the
SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act or the Exchange
Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, or
otherwise subject to the liabilities under the Securities Act or Exchange Act, except to the extent that we specifically
incorporate it by reference into such filing.
The following graph depicts the total cumulative stockholder return of our common stock from October 12, 2021, the first day
of trading of our common stock on the NYSE, through December 31, 2024, relative to the performance of the FTSE National
Association of Real Estate Investment Trusts Equity REITs Index (the "FTSE Nareit Equity Index"), the FTSE National
Association of Real Estate Investment Trusts Equity Shopping Centers Index (the "FTSE Nareit Shopping Centers Index"), and
the Standard and Poor’s 500 Stock Index (S&P 500 Index). The graph assumes an initial investment of $100.00 at the first
NYSE trade price of $23.61 on October 12, 2021 and that all dividends paid by companies included in these indices have been
reinvested. The performance shown in the graph below is not intended to forecast or be indicative of future stock price
performance.
Dollars
Comparison of Cumulative Total Return
InvenTrust Properties Corp.
FTSE NAREIT Equity Index
FTSE NAREIT Shopping Centers Index
S&P 500 Index
10/12/2021
12/31/2021
12/31/2022
12/31/2023
12/31/2024
80.00
90.00
100.00
110.00
120.00
130.00
140.00
150.00
FTSE Nareit Equity Index
100.00
112.75
85.28
96.99
105.46
FTSE Nareit Shopping Centers Index
100.00
107.87
94.34
105.70
123.71
S&P 500 Index
100.00
109.88
89.98
113.63
142.06
Ticker / Index
10/12/2021
12/31/2021
12/31/2022
12/31/2023
12/31/2024
IVT
$100.00
$116.32
$104.34
$115.87
$142.47
Recent Sales of Unregistered Securities
None.
Item 6. Reserved
19
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis relates to the operations of the Company for the years ended December 31, 2024 and
2023 and its financial position as of December 31, 2024 and 2023. Discussion of 2022 items and year-to-year comparisons
between 2023 and 2022 that are not included in this Annual Report can be found in "Part II, Item 7. Management's Discussion
and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the year ended
December 31, 2023. The following discussion and analysis should be read in conjunction with our consolidated financial
statements and the related notes included in this Annual Report. This discussion contains forward-looking statements about our
business. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual
results could differ materially because of factors discussed in "Forward-Looking Statements" and "Part I, Item 1A. Risk
Factors" contained in this Annual Report and in our other reports that we file from time to time with the SEC.
Executive Summary
Strategy and Outlook
InvenTrust Properties Corp. is a premier Sun Belt, multi-tenant essential retail REIT that owns, leases, redevelops, acquires, and
manages grocery-anchored neighborhood and community centers, as well as high-quality power centers that often have a
grocery component. We pursue our business strategy by acquiring retail properties in Sun Belt markets, opportunistically
disposing of retail properties, and maintaining a flexible capital structure.
InvenTrust focuses on Sun Belt markets with favorable demographics, including above-average growth in population,
employment, income and education levels. We believe these conditions create favorable demand characteristics for grocery-
anchored and necessity-based retail centers, which will position us to capitalize on potential future rent increases while enjoying
sustained occupancy at our centers. Our strategically located field offices are within a two-hour drive of over 95% of our
properties which affords us the ability to respond to the needs of our tenants and provides us with in-depth local market
knowledge. We believe that our Sun Belt portfolio of high quality grocery-anchored assets is a distinct differentiator for us in
the marketplace.
Evaluation of Operating Performance and Financial Condition
In addition to measures of operating performance determined in accordance with U.S. generally accepted accounting principles
("GAAP"), management evaluates our operating performance and financial condition by focusing on the following financial
and non-financial indicators, discussed in further detail herein:
•
Net Operating Income ("NOI") and Same Property NOI, supplemental non-GAAP measures;
•
Nareit Funds From Operations ("Nareit FFO") Applicable to Common Shares and Dilutive Securities, a supplemental
non-GAAP measure;
•
Core Funds From Operations ("FFO") Applicable to Common Shares and Dilutive Securities, a supplemental non-
GAAP measure;
•
Earnings Before Interest, Taxes, Depreciation, and Amortization ("EBITDA"), a supplemental non-GAAP measure;
•
Adjusted EBITDA, a supplemental non-GAAP measure;
•
Economic and leased occupancy and rental rates;
•
Leasing activity and lease rollover;
•
Operating expense levels and trends;
•
General and administrative expense levels and trends;
•
Debt maturities and leverage ratios; and
•
Liquidity levels.
20
Recent Developments
Acquisitions and Mortgage Assumption
During the year ended December 31, 2024, we acquired the following properties:
Date
Property
Anchor
Market
Square
Feet
Gross
Acquisition
Price
Assumption of
Mortgage Debt
2/1/24
The Plant (a)
Sprouts Farmers Market
Phoenix, AZ
57
$
29,500 $
13,000
4/9/24
Moores Mill
Publix
Atlanta Metro Area, GA
70
28,000
—
6/13/24
Maguire Groves (b)
Publix
Orlando-Kissimmee, FL
33
16,100
—
8/6/24
Scottsdale North
Marketplace
AJ's Fine Foods
Phoenix, AZ
66
23,000
—
10/9/24
Stonehenge Village
Wegmans
Richmond, VA
214
62,100
—
11/26/24
The Forum
Target
Cape Coral-Fort Myers, FL
186
41,370
—
12/18/24
Market at Mill Creek
Lowes Foods
Charleston-Berkeley-
Dorchester, SC
80
27,300
—
12/18/24
Nexton Square
N/A
Charleston-Berkeley-
Dorchester, SC
134
54,700
—
Total
840
$
282,070 $
13,000
(a)
The Company recognized a fair value adjustment of $0.4 million related to the mortgage payable secured by the property.
(b)
Maguire Groves is immediately adjacent to Plantation Grove, a Publix anchored neighborhood center wholly-owned by the Company.
The Company operates these properties under the Plantation Grove name.
Dispositions
During the year ended December 31, 2024, we disposed of the following properties:
Date
Property
Market
Square
Feet
Gross
Disposition Price
Gain (Loss)
on Sale, net
7/22/2024
Eldridge Town Center &
Windermere Village (a)
Houston - Sugar Land - Baytown, TX
N/A $
602 $
334
10/31/2024
Stevenson Ranch
So. California - Los Angeles, CA
187
57,800
(614)
12/13/2024
Eldridge Town Center &
Windermere Village (b)
Houston - Sugar Land - Baytown, TX
31
10,150
4,137
Total
218 $
68,552 $
3,857
(a)
This disposition was related to the completion of a partial condemnation at one retail property.
(b)
This disposition included the sale of an outparcel at Eldridge Town Center and the entirety of Windermere Village. Subsequent to the
transaction, the Company continues to operate the remaining property under the Eldridge Town Center name.
Debt
On June 5, 2024, we extinguished the $7.3 million and $8.4 million pooled mortgages payable secured by Plantation Grove and
Suncrest Village, respectively.
On September 27, 2024, we extinguished the remaining $72.5 million pooled mortgage payable secured by Cyfair Town
Center, Bay Colony, and Stables Town Center.
On October 23, 2024, we entered into a third amendment to the Amended Revolving Credit Agreement, which provides for,
among other things, an increase in the revolving commitments thereunder from $350.0 million to $500.0 million and an
extension of the maturity date to January 15, 2029, with one six-month extension option.
Common Stock Offering
On September 25, 2024, we completed an underwritten public offering of our common stock at a price to the public of $28.00
per share. We issued and sold 9,200,000 shares of our common stock, including 1,200,000 shares issued in connection with the
full exercise of the underwriters' over-allotment option. We received $247.3 million of net proceeds, after deducting
$10.3 million in underwriting discounts and commissions.
ATM Program
During the quarter ended December 31, 2024, we raised $7.8 million of net proceeds, after $0.1 million in commissions, under
our at-the-market equity offering program (the "ATM Program"), through the issuance of 254,082 shares of common stock at a
weighted average price of $30.96 per share. As of December 31, 2024, $236.7 million of common stock remains available for
issuance under the ATM Program.
21
Our Retail Portfolio
The following table summarizes our retail portfolio as of December 31, 2024 and 2023.
Year ended December 31
2024
2023
No. of properties
68
62
GLA (square feet)
10,972
10,324
Economic occupancy
95.3%
93.3%
Leased occupancy
97.4%
96.2%
ABR PSF
$20.07
$19.48
Same Property Summary
Properties classified as same property were owned for the entirety of both periods presented ("Same Properties"). The following
table summarizes the Same Properties of our retail portfolio for the years ended December 31, 2024 and 2023.
Year ended December 31
2024
2023
No. of properties
56
56
GLA (square feet)
8,916
8,890
Economic occupancy
95.3%
93.8%
Leased occupancy
97.6%
96.4%
ABR PSF
$20.34
$19.82
Leasing Activity
The following tables summarize the activity for leases executed during the year ended December 31, 2024, compared with
expiring or expired leases for the same or previous tenant for renewals, and the same unit for new leases. Of the retail portfolio's
expiring GLA of 1.22 million square feet during the year ended December 31, 2024, 1.15 million square feet was re-leased,
achieving a retention rate of approximately 94%.
No. of
Leases
Executed
GLA SF
(in
thousands)
New
Contractual
Rent
($PSF)(b)
Prior
Contractual
Rent
($PSF)(b)
% Change
over Prior
Lease Rent
(b)
Weighted
Average
Lease Term
(Years)
Tenant
Improvement
Allowance
($PSF)
Lease
Commissions
($PSF)
All tenants
Comparable Renewal
Leases (a)
145
985
$21.31
$19.27
10.6%
5.4
$0.04
$—
Comparable New Leases (a)
26
102
$28.95
$24.83
16.6%
10.3
$30.49
$13.03
Non-Comparable Renewal
and New Leases
39
236
$20.07
N/A
N/A
7.9
$16.59
$9.10
Total
210
1,323
$22.03
$19.79
11.3%
6.2
$5.34
$2.63
Anchor tenants (leases ten thousand square feet and over)
Comparable Renewal
Leases (a)
24
702
$14.48
$13.16
10.0%
5.4
$—
$—
Comparable New Leases (a)
2
42
$14.67
$12.54
17.0%
10.9
$30.00
$8.66
Non-Comparable Renewal
and New Leases
5
141
$10.92
N/A
N/A
7.6
$10.89
$5.86
Total
31
885
$14.49
$13.13
10.4%
6.0
$3.17
$1.35
Small shop tenants (leases under ten thousand square feet)
Comparable Renewal
Leases (a)
121
283
$38.23
$34.39
11.2%
5.4
$0.14
$—
Comparable New Leases (a)
24
60
$39.05
$33.56
16.4%
9.9
$30.83
$16.12
Non-Comparable Renewal
and New Leases
34
95
$33.73
N/A
N/A
8.5
$25.10
$13.95
Total
179
438
$38.37
$34.25
12.0%
6.7
$9.72
$5.21
(a)
Comparable leases are leases that meet all of the following criteria: terms greater than or equal to one year, unit was vacant less than one year
prior to executed lease, square footage of unit remains unchanged or within 10% of prior unit square footage, and has a rent structure consistent
with the previous tenant.
(b)
Non-comparable leases are not included in totals.
22
Results of Operations
Comparison of results for the years ended December 31, 2024 and 2023
We generate substantially all of our earnings from property operations. Since January 1, 2023, we have acquired twelve retail
properties and disposed of two retail properties.
The following table presents the changes in our income for the years ended December 31, 2024 and 2023.
Year ended December 31
2024
2023
Increase (Decrease)
Income
Lease income, net
$
272,440
$
257,146
$
15,294
Other property income
1,534
1,450
84
Other fee income
—
80
(80)
Total income
$
273,974
$
258,676
$
15,298
Lease income, net, for the year ended December 31, 2024 increased $15.3 million when compared to the same period in 2023,
as a result of increases from properties acquired of $10.6 million, decreases from properties disposed of $2.1 million, and the
following activity related to our Same Properties:
•
$4.1 million of increased minimum base rent attributable to increased occupancy and ABR PSF,
•
$2.3 million of increased common area maintenance and real estate tax recoveries,
•
$0.8 million of net changes in credit losses and related reversals,
•
$0.2 million of net increases in all other income, and
•
$0.4 million increase in lease termination income, partially offset by:
•
$1.0 million of net decreased amortization of market lease intangibles.
The following table presents the changes in our operating expenses for the years ended December 31, 2024 and 2023.
Year ended December 31
2024
2023
Increase
Operating expenses
Depreciation and amortization
$
113,948
$
113,430
$
518
Property operating
43,413
42,832
581
Real estate taxes
36,441
34,809
1,632
General and administrative
33,172
31,797
1,375
Total operating expenses
$
226,974
$
222,868
$
4,106
Depreciation and amortization increased $0.5 million as a result of:
•
$5.8 million of increases from properties acquired, partially offset by:
•
$0.5 million of decreases from properties disposed, and
•
$4.8 million of decreased amortization from our Same Properties, primarily driven by in-place lease intangibles.
Property operating expenses increased $0.6 million as a result of:
•
$1.2 million of increases from properties acquired, partially offset by:
•
$0.3 million of net decreased costs from our Same Properties primarily driven by decreased repairs and maintenance
costs and increased insurance costs, and
•
$0.3 million of decreases from properties disposed.
Real estate taxes increased $1.6 million as a result of:
•
$0.9 million of increases from properties acquired, and
•
$1.0 million of increases from our Same Properties, and partially offset by:
•
$0.3 million of decreases from properties disposed.
23
General and administrative expenses increased $1.4 million as a result of $0.8 million of increased stock-based compensation
expense and $0.6 million of increased other compensation costs.
The following table presents the changes in our other income and expenses for the years ended December 31, 2024 and 2023.
Year ended December 31
2024
2023
Change, net
Other income (expense)
Interest expense, net
$
(37,100) $
(38,138) $
1,038
Loss on extinguishment of debt
—
(15)
15
Impairment of real estate assets
(3,854)
—
(3,854)
Gain on sale of investment properties, net
3,857
2,691
1,166
Equity in losses of unconsolidated entities
—
(557)
557
Other income and expense, net
3,755
5,480
(1,725)
Total other (expense) income, net
$
(33,342) $
(30,539) $
(2,803)
Interest expense, net
Interest expense, net, decreased $1.0 million primarily as a result of:
•
decreased amortization of $1.7 million, partially offset by:
•
increased interest expense of $0.7 million related to the $92.5 million pooled mortgage payable assumed from our
previously owned unconsolidated joint venture, IAGM Retail Fund I, LLC ("IAGM") on October 17, 2023. On
December 22, 2023, the Company partially paid down this mortgage debt by $20.0 million. On September 27, 2024,
the Company extinguished the remaining $72.5 million pooled mortgage payable.
Impairment of real estate assets
During the year ended December 31, 2024, the Company recorded an impairment of real estate assets of $3.9 million on one
retail property after receiving and accepting a letter of intent to purchase the property for less than its carrying value.
Gain on sale of investment properties, net
During the year ended December 31, 2024, the Company recognized a gain of $4.5 million on the completion of a partial
condemnation and partial sale of one retail property and a loss of $0.6 million on the sale of one retail property. During the year
ended December 31, 2023, the Company recognized a gain of $1.0 million on the completion of a partial condemnation at one
retail property and a gain of $1.7 million on the sale of one retail property.
Equity in losses of unconsolidated entities
Equity in losses of unconsolidated entities decreased $0.6 million primarily as a result of the Company acquiring four retail
properties from IAGM since January 1, 2023. On December 15, 2023, IAGM was fully liquidated. See "Note 6. Investment in
Unconsolidated Entities" in the Notes to the Consolidated Financial Statements for additional information about the Company’s
former joint venture.
Other income and expense, net
Other income and expense, net, decreased $1.7 million primarily as a result of decreased non-recurring income from non-
operating activities.
24
Net Operating Income
We evaluate the performance of our retail properties based on NOI, which excludes general and administrative expenses,
depreciation and amortization, other income and expense, net, impairment of real estate assets, gains (losses) from sales of
properties, gains (losses) on extinguishment of debt, interest expense, net, equity in earnings (losses) from unconsolidated
entities, lease termination income and expense, and GAAP rent adjustments such as amortization of market lease intangibles,
amortization of lease incentives, and straight-line rent adjustments ("GAAP Rent Adjustments"). We bifurcate NOI into Same
Property NOI and NOI from other investment properties based on whether the retail properties meet our Same Property criteria.
NOI from other investment properties includes adjustments for the Company's captive insurance company. A total of 56 retail
properties met our Same Property criteria for the years ended December 31, 2024 and 2023.
We believe the supplemental non-GAAP measure of NOI, and the bifurcation into same property NOI and NOI from other
investment properties, are important measures in assessing operating performance and provide added comparability across
periods when evaluating the Company's financial condition and operating performance that is not readily apparent from Net
income in accordance with GAAP.
Reconciliation of Net Income to Non-GAAP Measures
The following table presents the reconciliation of net income, the most directly comparable GAAP measure, to NOI and Same
Property NOI:
Net income
$
13,658
$
5,269
$
8,389
Adjustments to reconcile to non-GAAP metrics:
Other income and expense, net
(3,755)
(5,480)
1,725
Equity in losses of unconsolidated entities
—
557
(557)
Interest expense, net
37,100
38,138
(1,038)
Loss on extinguishment of debt
—
15
(15)
Gain on sale of investment properties, net
(3,857)
(2,691)
(1,166)
Impairment of real estate assets
3,854
—
3,854
Depreciation and amortization
113,948
113,430
518
General and administrative
33,172
31,797
1,375
Other fee income
—
(80)
80
Adjustments to NOI (a)
(7,548)
(7,528)
(20)
NOI
186,572
173,427
13,145
NOI from other investment properties
(24,017)
(18,579)
(5,438)
Same Property NOI
$
162,555
$
154,848
$
7,707
Year ended December 31
2024
2023
Change, net
(a)
Adjustments to NOI include lease termination income and expense and GAAP Rent Adjustments.
25
Comparison of the components of Same Property NOI for the years ended December 31, 2024 and 2023
Minimum base rent
$
152,502
$
148,304
$
4,198
2.8 %
Real estate tax recoveries
29,463
28,184
1,279
4.5 %
Common area maintenance, insurance, and other recoveries
28,788
27,799
989
3.6 %
Ground rent income
14,674
14,760
(86)
(0.6) %
Short-term and other lease income
4,496
4,323
173
4.0 %
Provision for uncollectible billed rent and recoveries
(266)
(1,046)
780
(74.6) %
Other property income
1,305
1,241
64
5.2 %
230,962
223,565
7,397
3.3 %
Property operating
36,426
37,736
(1,310)
(3.5) %
Real estate taxes
31,981
30,981
1,000
3.2 %
68,407
68,717
(310)
(0.5) %
Same Property NOI
$
162,555
$
154,848
$
7,707
5.0 %
Year ended December 31
2024
2023
Change
Variance
Same Property NOI increased by $7.7 million, or 5.0%, when comparing the year ended December 31, 2024 to the same period
in 2023, and was primarily a result of increased occupancy, ABR PSF, favorable lease spreads, and leases with advantageous
fixed recovery terms.
Funds From Operations
The National Association of Real Estate Investment Trusts ("Nareit"), an industry trade group, has promulgated a widely
accepted non-GAAP financial measure of operating performance known as Funds From Operations ("Nareit FFO"). Our Nareit
FFO is net income (or loss) in accordance with GAAP, excluding gains (or losses) resulting from dispositions of properties,
plus depreciation and amortization and impairment charges on depreciable real property. Adjustments for IAGM are calculated
to reflect our proportionate share of the joint venture's funds from operations on the same basis.
In calculating Nareit FFO, impairment charges of depreciable real estate assets are added back even though the impairment
charge may represent a permanent decline in value due to the decreased operating performance of the applicable property.
Furthermore, because gains and losses from sales of property are excluded from Nareit FFO, it is consistent and appropriate that
impairments, which are often early recognition of losses on prospective sales of property, also be excluded.
We believe Nareit FFO Applicable to Common Shares and Dilutive Securities, when considered with the financial statements
determined in accordance with GAAP, is helpful to investors in understanding our performance because the historical
accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which
implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall
with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less
informative.
Core Funds From Operations ("Core FFO") is an additional supplemental non-GAAP financial measure of our operating
performance. In particular, Core FFO provides an additional measure to compare the operating performance of different REITs
without having to account for certain remaining amortization assumptions within Nareit FFO and other unique revenue and
expense items which some may consider not pertinent to measuring a particular company's on-going operating performance. In
that regard, we have historically used Core FFO as an input to our compensation plan to determine cash bonuses and measure
the achievement of certain performance-based equity awards.
Our adjustments to Nareit FFO to arrive at Core FFO include removing the impact of (i) amortization of debt discounts and
financing costs, (ii) amortization of market-lease intangibles and inducements, net, (iii) depreciation and amortization of
corporate assets, (iv) straight-line rent adjustments, (v) gains (or losses) resulting from debt extinguishments (vi) other non-
operating revenue and expense items which, in our judgment, are not pertinent to measuring on-going operating performance,
and (vii) adjustments for IAGM to reflect our share of the ventures' Core FFO on the same basis. Our calculation of Core FFO
Applicable to Common Shares and Dilutive Securities does not consider any capital expenditures.
26
Other REITs may use alternative methodologies for calculating similarly titled measures, which may not be comparable to our
definition and calculation of Nareit FFO Applicable to Common Shares and Dilutive Securities or Core FFO Applicable to
Common Shares and Dilutive Securities. Furthermore, Nareit FFO and Core FFO are not necessarily indicative of cash flow
available to fund cash needs and should not be considered as alternatives to net income as an indication of our performance.
Nareit FFO and Core FFO should not be considered as alternatives to our cash flows from operating, investing, and financing
activities. Nor should Nareit FFO and Core FFO be considered as measures of liquidity, our ability to make cash distributions,
or our ability to service our debt.
The following table presents the reconciliation of net income, the most directly comparable GAAP measure, to Nareit FFO
Applicable to Common Shares and Dilutive Securities and Core FFO Applicable to Common Shares and Dilutive Securities:
Year ended December 31
2024
2023
Net income
$
13,658
$
5,269
Depreciation and amortization of real estate assets
113,055
112,578
Impairment of real estate assets
3,854
—
Gain on sale of investment properties, net
(3,857)
(2,691)
Unconsolidated joint venture adjustments (a)
—
342
Nareit FFO Applicable to Common Shares and Dilutive Securities
126,710
115,498
Amortization of market lease intangibles and inducements, net
(2,804)
(3,343)
Straight-line rent adjustments, net
(3,400)
(3,349)
Amortization of debt discounts and financing costs
2,403
4,113
Depreciation and amortization of corporate assets
893
852
Non-operating income and expense, net (b)
(1,033)
(1,821)
Unconsolidated joint venture adjusting items, net (c)
—
(92)
Core FFO Applicable to Common Shares and Dilutive Securities
$
122,769
$
111,858
Weighted average common shares outstanding - basic
70,394,448
67,531,898
Dilutive effect of unvested restricted shares (d)
616,120
281,282
Weighted average common shares outstanding - diluted
71,010,568
67,813,180
Net income per diluted share
$
0.19
$
0.08
Per share adjustments for Nareit FFO
1.59
1.62
Nareit FFO per diluted share
$
1.78
$
1.70
Per share adjustments for Core FFO
(0.05)
(0.05)
Core FFO per diluted share
$
1.73
$
1.65
(a)
Reflects the Company’s share of adjustments for IAGM's Nareit FFO on the same basis as InvenTrust.
(b)
Reflects items which are not pertinent to measuring on-going operating performance, such as miscellaneous and settlement income, and
basis difference recognition arising from acquiring the four remaining properties of IAGM in 2023.
(c)
Reflects the Company’s share of adjustments for IAGM's Core FFO on the same basis as InvenTrust.
(d)
For purposes of calculating non-GAAP per share metrics, the Company applies the same denominator used in calculating diluted
earnings per share in accordance with GAAP.
27
Earnings Before Interest, Taxes, Depreciation, and Amortization
Our measure of EBITDA is net income (or loss) in accordance with GAAP, excluding interest expense, net, income tax expense
(or benefit), and depreciation and amortization. Adjustments for IAGM are calculated to reflect our proportionate share of the
joint venture's EBITDA on the same basis.
Adjusted EBITDA is an additional supplemental non-GAAP financial measure of our operating performance. In particular,
Adjusted EBITDA provides an additional measure to compare the operating performance of different REITs without having to
account for certain remaining amortization assumptions within EBITDA, certain gains or losses remaining within EBITDA, and
other unique revenue and expense items which some may consider not pertinent to measuring a particular company's on-going
operating performance.
Our adjustments to EBITDA to arrive at Adjusted EBITDA include removing the impact of (i) gains (or losses) resulting from
dispositions of properties, (ii) impairment charges on depreciable real property, (iii) amortization of market-lease intangibles
and inducements, (vi) straight-line rent adjustments, (v) gains (or losses) resulting from debt extinguishments, (vi) other non-
operating revenue and expense items which, in our judgment, are not pertinent to measuring on-going operating performance,
(vii) adjustments for IAGM to reflect our share of the ventures' Adjusted EBITDA on the same basis.
The following table presents the reconciliation of net income, the most directly comparable GAAP measure, to EBITDA and
Adjusted EBITDA:
Year ended December 31
2024
2023
Net income
$
13,658
$
5,269
Interest expense, net
37,100
38,138
Income tax expense
543
517
Depreciation and amortization
113,948
113,430
Unconsolidated joint venture adjustments (a)
—
417
EBITDA
165,249
157,771
Impairment of real estate assets
3,854
—
Gain on sale of investment properties, net
(3,857)
(2,691)
Amortization of market-lease intangibles and inducements, net
(2,804)
(3,343)
Straight-line rent adjustments, net
(3,400)
(3,349)
Non-operating income and expense, net (b)
(1,033)
(1,821)
Unconsolidated joint venture adjusting items, net (c)
—
(108)
Adjusted EBITDA
$
158,009
$
146,459
(a)
Reflects the Company's share of adjustments for IAGM's EBITDA on the same basis as InvenTrust.
(b)
Reflects items which are not pertinent to measuring on-going operating performance, such as miscellaneous and settlement income, and
basis difference recognition arising from acquiring the four remaining properties of IAGM in 2023.
(c)
Reflects the Company’s share of adjustments for IAGM's Adjusted EBITDA on the same basis as InvenTrust.
28
Liquidity and Capital Resources
Capital Investments and Leasing Costs
Operating retail properties generally require capital investments, including value-enhancing development and redevelopment
projects and leasing commissions.
The following table summarizes the capital resources used for capital investments and leasing costs on a cash basis:
Year ended December 31
2024
2023
Tenant improvements
$
9,096
$
7,945
Leasing costs
3,762
3,888
Property improvements
11,486
17,424
Capitalized indirect costs (a)
1,435
1,929
Total capital expenditures and leasing costs
25,779
31,186
Development and redevelopment direct costs
9,253
3,788
Development and redevelopment indirect costs (a)
1,084
770
Capital investments and leasing costs (b)
$
36,116
$
35,744
(a)
Indirect costs include capitalized interest, real estate taxes, insurance, and payroll costs.
(b)
As of December 31, 2024 and 2023, total accrued capital investments and leasing costs were $3,620 and $2,562, respectively.
Short-Term Liquidity and Capital Resources
On a short-term basis, our principal uses for funds are to pay our operating and corporate expenses, interest and principal on our
indebtedness, property capital expenditures, and to make distributions to our stockholders.
Our ability to maintain adequate liquidity for our operations in the future is dependent upon a number of factors, including our
revenue, macroeconomic conditions, our ability to contain costs, including capital expenditures, and to collect rents and other
receivables, and various other factors, many of which are beyond our control. We will continue to monitor our liquidity position
and may seek to raise funds through debt or equity financing in the future to fund operations, significant investments or
acquisitions that are consistent with our strategy. Our ability to raise these funds may also be diminished by other
macroeconomic factors.
Long-Term Liquidity and Capital Resources
Our objectives are to maximize revenue generated by our retail platform, to further enhance the value of our retail properties to
produce attractive current yield and long-term returns for our stockholders, and to generate sustainable and predictable cash
flow from our operations to distribute to our stockholders.
Any future determination to pay distributions will be at the discretion of our Board and will depend on our financial condition,
capital requirements, restrictions contained in current or future financing instruments, and such other factors as our Board
deems relevant.
Our primary sources and uses of capital are as follows:
Sources
Uses
•
Operating cash flows from our real estate investments;
•
Proceeds from sales of properties;
•
Proceeds from mortgage loan borrowings on properties;
•
Proceeds from corporate borrowings and debt financings;
•
Proceeds from any ATM Program activities or other
equity offerings; and
•
Proceeds from our Series A and Series B Notes offering or
other debt offerings.
•
To invest in properties or fund acquisitions;
•
To fund development, re-development, maintenance and
capital expenditures or leasing incentives;
•
To make distributions to our stockholders;
•
To service or pay down our debt;
•
To pay our operating expenses;
•
To repurchase shares of our common stock; and
•
To fund other general corporate uses.
29
On September 25, 2024, we completed an underwritten public offering of our common stock at a price to the public of $28.00
per share. We issued and sold 9,200,000 shares of our common stock, including 1,200,000 shares issued in connection with the
full exercise of the underwriters' over-allotment option. We received $247.3 million of net proceeds, after deducting $10.3
million in underwriting discounts and commissions.
In the first quarter of 2022, we entered into an ATM Program pursuant to which we may sell shares of our common stock up to
an aggregate purchase price of $250.0 million. During the quarter ended December 31, 2024, we raised $7.8 million of net
proceeds, after $0.1 million in commissions, under the ATM Program, through the issuance of 254,082 shares of common stock
at a weighted average price of $30.96 per share. As of December 31, 2024, $236.7 million of common stock remains available
for issuance under the ATM Program.
We believe our status as an NYSE-listed issuer will facilitate supplementing our capital sources by selling equity securities of
the Company under the ATM Program or otherwise if and when we believe appropriate to do so. Also, from time to time, we
may seek to acquire amounts of our outstanding common stock through cash purchases or exchanges for other securities. Such
purchases or exchanges, if any, will depend on our liquidity requirements, contractual restrictions, and other factors. At this
time, we believe our current sources of liquidity are sufficient to meet our short- and long-term cash demands.
Off Balance Sheet Arrangements
None.
Summary of Cash Flows
Year ended December 31
Change
2024
2023
Cash provided by operating activities
$
136,876
$
129,621
$
7,255
Cash used in investing activities
(240,535)
(79,718)
(160,817)
Cash provided by (used in) financing activities
95,117
(87,902)
183,019
Decrease in cash, cash equivalents and restricted cash
(8,542)
(37,999)
29,457
Cash, cash equivalents and restricted cash at beginning of year
99,763
137,762
(37,999)
Cash, cash equivalents and restricted cash at end of year
$
91,221
$
99,763
$
(8,542)
Cash provided by operating activities of $136.9 million and $129.6 million for the years ended December 31, 2024 and 2023,
respectively, was generated primarily from income from property operations. Cash provided by operating activities increased
$7.3 million when comparing 2024 to 2023, primarily as a result of acquisition activity in excess of disposition activity and
general fluctuations in working capital. Since January 1, 2023, we have acquired twelve retail properties and disposed of two
retail properties.
Cash used in investing activities of $240.5 million for the year ended December 31, 2024, was primarily the result of:
•
$268.1 million for acquisitions of investment properties,
•
$36.1 million for capital investments and leasing costs, and
•
$1.4 million from other investing activities, which was partially offset by:
•
$65.1 million from the sale of investment properties.
Cash used in investing activities of $79.7 million for the year ended December 31, 2023, was primarily the result of:
•
$152.0 million for acquisitions of investment properties, and
•
$35.8 million for capital investments and leasing costs, which were partially offset by:
•
$95.1 million from distributions from unconsolidated entities,
•
$12.6 million from the sale of investment properties, and
•
$0.4 million from other investing activities.
30
Cash provided by financing activities of $95.1 million for the year ended December 31, 2024, was primarily the result of:
•
$257.6 million in proceeds from the public offering of our common stock,
•
$8.4 million from proceeds from the sale of common stock under the ATM and ESPP, which were partially offset by:
•
$93.4 million for pay-off of debt and other financing activities,
•
$62.8 million to pay distributions,
•
$12.1 million for costs incurred in relation to sales of our common stock, and
•
$2.6 million for the payment of tax withholdings for share-based compensation.
Cash used in financing activities of $87.9 million for the year ended December 31, 2023, was primarily the result of:
•
$57.5 million to pay distributions,
•
$33.8 million for pay-off of debt, debt prepayment penalties, principal payments of mortgage debt, payment of loan
fees, and other financing activities, and
•
$1.6 million for the payment of tax withholdings for share-based compensation, which was partially offset by:
•
$5.0 million from net proceeds from the sale of common stock under the ESPP and ATM.
We consider all demand deposits, money market accounts and investments in certificates of deposit and repurchase agreements
with a maturity of three months or less, at the date of purchase, to be cash equivalents. We maintain our cash and cash
equivalents at major financial institutions. The combined account balances at one or more institutions generally exceed the
FDIC insurance coverage. We periodically assess the credit risk associated with these financial institutions. We believe
insignificant credit risk exists related to amounts on deposit in excess of FDIC insurance coverage.
Acquisitions and Dispositions of Real Estate Investments
In 2024, we acquired seven retail properties for an aggregate gross acquisition price of $282.1 million. In 2023, we acquired
five retail properties for an aggregate gross acquisition price of $244.0 million.
In 2024, we disposed of one retail property and an outparcel adjacent to an existing retail property and completed a partial
condemnation at one retail property for an aggregate gross disposition price of $68.6 million. In 2023, we disposed of one retail
property for an aggregate gross disposition price of $13.1 million.
31
Distributions
During the year ended December 31, 2024, we declared cash distributions to our stockholders totaling $65.7 million and paid
cash distributions of $62.8 million.
As we execute on our retail strategy, the Board evaluated and expects to continue evaluating our distribution rate on a periodic
basis. See "Part I. Item 1. Business - Business Strategy" for more information regarding our retail strategy. The following table
presents a historical summary of distributions declared, paid and reinvested.
Year ended December 31
2024
2023
2022
2021
2020
Distributions declared
$
65,697 $
58,248
$
55,337
$
55,721
$
54,604
Distributions paid
$
62,779 $
57,491
$
55,302
$
55,561
$
54,214
Distributions reinvested
$
—
$
—
$
—
$
—
$
185
Borrowings
Mortgages Payable, Maturities
The following table summarizes the scheduled maturities of our mortgages payable as of December 31, 2024.
Scheduled maturities by year:
Principal Balance
2025
$
35,880
2026
—
2027
26,000
2028
—
2029
31,500
Thereafter
—
Total mortgages payable
$
93,380
Credit Agreements, Maturities
The following table summarizes the outstanding borrowings under our unsecured term loans as of December 31, 2024.
Maturity Date
Interest Rate
Principal Balance
$200.0 million 5 year
9/22/26
2.81% (a)
$
100,000
$200.0 million 5 year
9/22/26
2.81% (a)
100,000
$200.0 million 5.5 year
3/22/27
2.78% (a)
50,000
$200.0 million 5.5 year
3/22/27
2.84% (a)
50,000
$200.0 million 5.5 year
3/22/27
4.99% (a)
100,000
Total
$
400,000
(a)
Interest rates reflect the fixed rates achieved through the Company's interest rate swaps.
Senior Notes, Maturities
The following table summarizes the outstanding borrowings under our Senior Notes as of December 31, 2024.
Maturity Date
Fixed Interest Rate
Principal Balance
$150.0 million Series A
8/11/29
5.07%
$
150,000
$100.0 million Series B
8/11/32
5.20%
100,000
$
250,000
32
Contractual Obligations
We have obligations related to our mortgage loans, senior notes, term loans, and revolving credit facility as described in "Note
8. Debt" in the consolidated financial statements.
The following table presents our obligations to make future payments under debt and lease agreements as of December 31,
2024, exclusive of debt discounts and financing costs which are not future cash obligations.
Payments due by year ending December 31
2025
2026
2027
2028
2029
Thereafter
Total
Long term debt:
Fixed rate debt, principal (a)
$
35,880
$
200,000
$
226,000
$
—
$
181,500
$
100,000
$
743,380
Interest
30,467
27,891
17,089
14,853
11,081
13,578
114,959
Total long term debt
66,347
227,891
243,089
14,853
192,581
113,578
858,339
Operating leases (b)
511
517
529
522
493
293
2,865
Grand total
$
66,858
$
228,408
$
243,618
$
15,375
$
193,074
$
113,871
$
861,204
(a)
Includes variable rate debt swapped to fixed rates through the Company's interest rate swaps.
(b)
Includes leases on corporate office spaces.
Critical Accounting Estimates
General
The accompanying consolidated financial statements have been prepared in accordance with GAAP, which require management
to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the
reporting periods. Significant estimates, judgments, and assumptions are required in a number of areas, including, but not
limited to, evaluating the collectibility of accounts receivable, allocating the purchase price of acquired retail properties, and
evaluating the impairment of long-lived assets. We base these estimates, judgments and assumptions on historical experience
and various other factors that we believe to be reasonable under the circumstances. Actual results may differ from these
estimates.
Acquisition of Real Estate
We evaluate the inputs, processes and outputs of each asset acquired to determine if the transaction is a business combination or
asset acquisition. If an acquisition qualifies as a business combination, the related transaction costs are expensed. If an
acquisition qualifies as an asset acquisition, the related transaction costs are generally capitalized and amortized over the useful
life of the acquired assets. Generally, our acquisitions of real estate qualify as asset acquisitions.
We allocate the purchase price of real estate to land, building, other building improvements, tenant improvements, intangible
assets and liabilities (such as the value of above- and below-market leases, in-place leases and origination costs associated with
in-place leases). The values of above- and below-market leases are recorded as intangible assets and intangible liabilities,
respectively, and are amortized as either a decrease (in the case of above-market leases) or an increase (in the case of below-
market leases) to lease income, net over the remaining term of the associated tenant lease. The values, if any, associated with in-
place leases are recorded in intangible assets and are amortized to depreciation and amortization expense over the remaining
lease term.
The difference between the contractual rental rates and our estimate of market rental rates is measured over a period equal to the
remaining non-cancelable term of the leases plus the term of any below-market renewal options. For the amortization period,
the remaining term of leases with renewal options at terms below market reflect the assumed exercise of such below-market
renewal options, if reasonably assured.
If a tenant vacates its space prior to the contractual expiration of the lease and no rental payments are being made on the lease,
any unamortized balance of the related intangible asset or liability is written off. Tenant improvements are depreciated and
origination costs are amortized over the remaining term of the lease or charged against earnings if the lease is terminated prior
to its contractual expiration date.
33
With the assistance of a third-party valuation specialist, we perform the following procedures for assets acquired:
•
Estimate the value of the property "as if vacant" as of the acquisition date;
•
Allocate the value of the property among land, building, and other building improvements and determine the
associated useful life for each;
•
Calculate the value and associated life of above- and below-market leases on a tenant-by-tenant basis. The difference
between the contractual rental rates and our estimate of market rental rates is measured over a period equal to the
remaining term of the leases (using a discount rate which reflects the risks associated with the leases acquired,
including geographical location, size of leased area, tenant profile and credit risk);
•
Estimate the fair value of the tenant improvements, legal costs and leasing commissions incurred to obtain the leases
and calculate the associated useful life for each;
•
Estimate the fair value of assumed debt, if any; and
•
Estimate the intangible value of the in-place leases based on lease execution costs of similar leases as well as lost rent
payments during an assumed lease-up period and their associated useful lives on a tenant-by-tenant basis.
Impairment of Long Lived Assets
We assess the carrying values of our long-lived tangible and intangible assets whenever events or changes in circumstances
indicate that they may not be fully recoverable. An example of an event or changed circumstance is a reduction in the expected
holding period of a property. When such event or circumstances occur, if it is expected that the carrying value is not
recoverable, because the expected undiscounted cash flows do not exceed that carrying value, we recognize an impairment loss
to the extent that the carrying value exceeds the estimated fair value. The valuation and possible subsequent impairment of
investment properties is a significant estimate that can and does change based on our continuous process of analyzing each
property's economic condition over time and reviewing and updating assumptions about uncertain inherent factors, including
observable inputs such as contractual revenues and unobservable inputs such as forecasted revenues and expenses, estimated
net disposition proceeds, discount and capitalization rates. These unobservable inputs are based on market conditions and the
property's expected growth rates. Assumptions and estimates about future cash flows and discount and capitalization rates are
complex and subjective. Changes in economic and operating conditions and in our ultimate investment intent that occur
subsequent to the impairment analyses could impact these assumptions and result in additional impairment.
Our assessment of expected hold period for investment properties evaluated for impairment is of particular significance because
of the material impact it has on the evaluation of the property's recoverability. Changes in our disposition strategy or changes in
the marketplace may alter the expected hold period of a property which may result in an impairment loss and such loss could be
material to the Company's financial condition or operating performance.
Inflation
With respect to current economic conditions and governmental fiscal policy, inflation has become a greater risk. Rising
inflation may affect our and our tenants' expenses, including, without limitation, by increasing product prices and costs such as
wages, benefits, taxes, property and casualty insurance, borrowing costs and utilities. We rely on the performance of our assets
to increase revenues in order to keep pace with inflation. We may not be able to offset high rates of inflation through rent
increases due to the long-term nature of some of our leases.
A number of our leases contain provisions designed to partially mitigate adverse impacts of inflation. Our leases typically
require the tenant to pay its share of operating expenses, including common area maintenance, real estate taxes and insurance,
thereby reducing our exposure to increases in these costs resulting from inflation, although some larger tenants have capped the
amount of these operating costs they are responsible for. A portion of our leases also include clauses enabling us to receive
percentage rents based on a tenant's gross sales above specified levels or rental escalation clauses which are typically based on
increases in the Consumer Price Index or similar inflation indices.
34
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Risk
The Company is subject to market risk associated with changes in interest rates both in terms of variable-rate debt and the price
of new fixed-rate debt upon maturity of existing debt. The Company's interest rate risk management objectives are to limit the
impact of interest rate changes on earnings and cash flows. As of December 31, 2024, the Company's debt included outstanding
variable-rate debt of $400.0 million, all of which has been swapped to a fixed rate.
We maintain risk management control systems to monitor interest rate cash flow risk attributable to both outstanding or
forecasted debt obligations as well as our potential offsetting hedge positions. The risk management control systems involve the
use of analytical techniques, including cash flow sensitivity analysis, to estimate the expected impact of changes in interest rates
on our future cash flows. We continue to assess retaining cash flows that may assist us in maintaining a flexible low leverage
balance sheet and managing the impact of debt maturities.
We monitor interest rate risk using a variety of techniques, including periodically evaluating fixed interest rate quotes on all
variable rate debt and the costs associated with converting the debt to fixed rate debt. In addition, existing fixed and variable
rate loans that are scheduled to mature within the next two years are evaluated for possible early refinancing and/or extension
due to consideration given to current interest rates. Refer to our Borrowings table in Item 7 of this Annual Report for debt
principal amounts and expected maturities by year to evaluate the expected cash flows and sensitivity to interest rate changes.
We may use financial instruments to hedge exposures to changes in interest rates on loans. To the extent we do, we are exposed
to credit risk and market risk. Credit risk is the risk of failure of the counterparty to perform under the terms of the derivative
contract. When the fair value of a derivative contract is positive, the counterparty owes us, which creates credit risk for us.
When the fair value of a derivative contract is negative, we owe the counterparty and, therefore, it does not pose credit risk. We
seek to minimize the credit risk in derivative instruments by entering into transactions with what we believe are high-quality
counterparties. Market risk is the adverse effect on the value of a financial instrument resulting from a change in interest rates.
On March 16, 2023, the Company entered into one interest rate swap agreement with a notional amount of $100.0 million at
3.69%, achieving a fixed interest rate of 4.99%. As of the effective date of April 3, 2023, the entirety of the Company's variable
rate term loans were swapped to fixed rates through the maturity dates of the Amended Term Loan Agreement.
The following table summarizes the Company's interest rate swaps as of December 31, 2024 and 2023:
Interest Rate Swaps
Effective
Date
Termination
Date
InvenTrust
Receives
InvenTrust Pays
Fixed Rate of
Fixed Rate
Achieved
Notional
Amount
Fair Value as of Dec. 31
2024
2023
5.5 Year Term Loan
12/2/19
6/21/24
1-Month SOFR
N/A
N/A
$
—
$
—
$
855
5.5 Year Term Loan
12/2/19
6/21/24
1-Month SOFR
N/A
N/A
—
—
857
5.5 Year Term Loan
4/3/23
3/22/27
1-Month SOFR
3.69%
4.99%
100,000
656
(122)
5 Year Term Loan
12/21/23
9/22/26
1-Month SOFR
1.51%
2.81%
100,000
4,212
5,820
5 Year Term Loan
12/21/23
9/22/26
1-Month SOFR
1.51%
2.81%
100,000
4,226
5,845
5.5 Year Term Loan
6/21/24
3/22/27
1-Month SOFR
1.54%
2.84%
50,000
2,698
2,451
5.5 Year Term Loan
6/21/24
3/22/27
1-Month SOFR
1.48%
2.78%
50,000
2,634
2,368
$
400,000
$
14,426
$
18,074
Gains or losses resulting from marking-to-market derivatives each reporting period are recognized as an increase or decrease in
comprehensive income (loss) on the consolidated statements of operations and comprehensive income (loss).
The information presented above does not consider all exposures or positions that could arise in the future. Therefore, the
information represented herein has limited predictive value. As a result, the ultimate realized gain or loss with respect to interest
rate fluctuations will depend on the exposures that arise during the period, the hedging strategies at the time, and the related
interest rates.
35
Item 8. Consolidated Financial Statements and Supplementary Data
See the Index to Consolidated Financial Statements and Financial Statement Schedule commencing on page F-1.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Not applicable.
Item 9A. Controls and Procedures
As required by Rule 13a-15(b) and Rule 15d-15(b) under the Exchange Act, our management, including our Principal
Executive Officer and our Principal Financial Officer evaluated as of December 31, 2024, the effectiveness of our disclosure
controls and procedures as defined in Exchange Act Rules 13a-15(e) and Rule 15d-15(e). Based on that evaluation, our
Principal Executive Officer and our Principal Financial Officer concluded that our disclosure controls and procedures, as of
December 31, 2024, were effective at a reasonable assurance level for the purpose of ensuring that information required to be
disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in SEC rules and forms, and is accumulated and communicated to management, including our
Principal Executive Officer and Principal Financial Officer as appropriate to allow timely decisions regarding required
disclosures.
Management's Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term
is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Our management, including our Principal Executive Officer and
Principal Financial Officer, evaluated as of December 31, 2024, the effectiveness of our internal control over financial reporting
based on the framework in "Internal Control-Integrated Framework" issued by the Committee of Sponsoring Organizations of
the Treadway Commission (2013). Based on its evaluation, our management concluded that our internal control over financial
reporting was effective as of December 31, 2024.
Independent Registered Public Accounting Firm’s Report on Internal Control Over Financial Reporting
KPMG LLP, an independent registered public accounting firm, has audited the Company's consolidated financial statements
included in this Annual Report and, as part of its audit, has issued its report, included herein on page F-4, on the effectiveness
of our internal control over financial reporting.
Changes in Internal Control over Financial Reporting
There has been no change in our internal control over financial reporting during the quarter ended December 31, 2024, that has
materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information
None.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
36
Part III
Item 10. Directors, Executive Officers and Corporate Governance
The following information with respect to our board of directors and executive officers is presented as of February 13, 2025:
Name
Age
Position at IVT
Principal Employment
Daniel J. Busch
43
President, Chief Executive Officer & Director
Same
Christy L. David
46
Executive Vice President, Chief Operating
Officer, General Counsel and Secretary
Same
Michael D. Phillips
43
Executive Vice President, Chief Financial
Officer and Treasurer
Same
Stuart Aitken
53
Director
President and Chief Executive Officer of Circana, a
market research and technology company
Amanda Black
49
Director
Former Global Chief Investment Officer and Managing
Director of JLP Asset Management, a real estate
investment firm
Thomas F. Glavin
65
Director
Owner of Thomas F. Glavin & Associates, Inc., a
certified public accounting firm
Scott A. Nelson
68
Director
Principal of SAN Property Advisors, a retail real estate
advisory firm
Paula Saban
71
Director
Development Director of Interim Execs, a placement
firm for interim CXO's
Smita N. Shah
51
Director
Chief Executive Officer of SPAAN Tech, Inc., an
architecture, engineering, and project management firm
Michael A. Stein
75
Director
Retired
Julian Whitehurst
67
Director
Retired
We have adopted an Insider Trading Compliance Policy that governs the purchase, sale, and/or other dispositions of our
securities by officers, directors and employees that is reasonably designed to promote compliance with insider trading laws,
rules and regulations, and the listing requirements of the NYSE. A copy of our Insider Trading Compliance Policy is filed as
Exhibit 19.1 to this Annual Report.
Other information called for by this Item is incorporated by reference to the information set forth in our definitive Proxy
Statement, to be filed with the SEC within 120 days after the end of the Company's fiscal year ended December 31, 2024 in
connection with our 2025 Annual Meeting of Stockholders, and is incorporated herein by reference.
Item 11. Executive Compensation
The information called for by this Item is incorporated by reference to the information set forth in our definitive Proxy
Statement, to be filed with the SEC within 120 days after the end of the Company's fiscal year ended December 31, 2024 in
connection with our 2025 Annual Meeting of Stockholders, and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information called for by this Item is incorporated by reference to the information set forth in our definitive Proxy
Statement, to be filed with the SEC within 120 days after the end of the Company's fiscal year ended December 31, 2024 in
connection with our 2025 Annual Meeting of Stockholders, and is incorporated herein by reference.
Equity Compensation Plan Information
The following table provides information regarding our equity compensation plans approved by stockholders as of
December 31, 2024.
I
II
Plan Description
Number of Shares
Issuable Upon Vesting (a)
Number of Securities Remaining Available for
Future Issuance Under Equity Compensation Plans
(Excluding Securities Reflected in column I)
Incentive Award Plan (b)
1,334,503
2,854,824
ESPP
N/A
3,274,365
Total
6,129,189
(a)
Represents restricted share unit ("RSU") awards outstanding under the Incentive Award Plan as of December 31, 2024.
(b)
The weighted average grant date price per share of common stock underlying the unvested restricted stock units based on total outstanding
restricted stock units as of December 31, 2024 was $17.71.
37
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information called for by this Item is incorporated by reference to the information set forth in our definitive Proxy
Statement, to be filed with the SEC within 120 days after the end of the Company's fiscal year ended December 31, 2024 in
connection with our 2025 Annual Meeting of Stockholders, and is incorporated herein by reference.
Item 14. Principal Accounting Fees and Services
The information called for by this Item is incorporated by reference to the information set forth in our definitive Proxy
Statement, to be filed with the SEC within 120 days after the end of the Company's fiscal year ended December 31, 2024 in
connection with our 2025 Annual Meeting of Stockholders, and is incorporated herein by reference.
Part IV
Item 15. Exhibits and Financial Statement Schedules
(a) Documents filed as part of this Annual Report
Page
Reports of Independent Registered Public Accounting Firm (PCAOB ID:185)
F-2
1 Consolidated Financial Statements
Consolidated Balance Sheets as of December 31, 2024 and 2023
F-5
Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2024, 2023 and 2022
F-6
Consolidated Statements of Equity for the years ended December 31, 2024, 2023 and 2022
F-7
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023 and 2022
F-8
Notes to Consolidated Financial Statements
F-10
2 Consolidated Financial Statement Schedules
Schedule III - Real Estate and Accumulated Depreciation
F-29
All schedules other than those indicated in the index have been omitted as the required information is inapplicable or the
information is presented in the consolidated financial statements or related notes.
3 EXHIBITS
The following documents are filed as exhibits to this report:
2.1
Master Modification Agreement, dated as of March 12, 2014, by and among Inland American Real Estate Trust, Inc., Inland American
Business Manager & Advisor, Inc., Inland American Lodging Corporation, Inland American Holdco Management LLC, Inland
American Retail Management LLC, Inland American Office Management LLC, Inland American Industrial Management LLC and
Eagle I Financial Corp. (incorporated by reference to Exhibit 2.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC
on March 13, 2014)
2.2
Asset Acquisition Agreement, dated as of March 12, 2014, by and among Inland American Real Estate Trust, Inc., Inland American
Holdco Management LLC, Inland American Retail Management LLC, Inland American Office Management LLC, Inland American
Industrial Management LLC and Eagle I Financial Corp. (incorporated by reference to Exhibit 2.2 to the Registrant’s Form 8-K, as
filed by the Registrant with the SEC on March 13, 2014)
2.3
Separation and Distribution Agreement by and between Inland American Real Estate Trust, Inc. and Xenia Hotels & Resorts, Inc.,
dated as of January 20, 2015 (incorporated by reference to Exhibit 2.1 to the Registrant’s Form 8-K, as filed by the Registrant with the
SEC on January 23, 2015)
2.4
Separation and Distribution Agreement by and between InvenTrust Properties Corp. and Highlands REIT, Inc., dated as of April 14,
2016 (incorporated by reference to Exhibit 2.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on April 14, 2016)
2.5
Stock Purchase Agreement by and among InvenTrust Properties Corp., University House Communities Group, Inc. and UHC
Acquisition Sub LLC, dated as of January 3, 2016 (incorporated by reference to Exhibit 2.1 to the Registrant's Form 10-Q, as filed by
the Registrant on May 10, 2016)
2.6
Amendment No. 1 to Stock Purchase Agreement, dated as of May 30, 2016, by and among InvenTrust Properties Corp., University
House Communities Group, Inc. and UHC Acquisition Sub LLC (incorporated by reference to Exhibit 2.2 to the Registrant's Form 8-
K, as filed by the Registrant on June 27, 2016)
2.7
Amendment No. 2 to Stock Purchase Agreement, dated as of June 20, 2016, by and among InvenTrust Properties Corp., University
House Communities Group, Inc. and UHC Acquisition Sub LLC (incorporated by reference to Exhibit 2.3 to the Registrant's Form 8-
K, as filed by the Registrant on June 27, 2016)
3.1
Seventh Articles of Amendment and Restatement of InvenTrust Properties Corp., as amended (incorporated by reference to Exhibit 3.1
to the Registrant’s Form 10-Q, as filed by the Registrant with the SEC on May 14, 2015)
3.2
Articles of Amendment of InvenTrust Properties Corp. (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, as filed
by the Registrant with the SEC on August 5, 2021)
EXHIBIT
NO.
DESCRIPTION
38
3.3
Articles of Amendment of InvenTrust Properties Corp. (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, as filed
by the Registrant with the SEC on August 5, 2021)
3.4
Articles Supplementary of InvenTrust Properties Corp. (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, as filed
by the Registrant with the SEC on October 12, 2021)
3.5
Articles of Amendment of InvenTrust Properties Corp. (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, as filed
by the Registrant with the SEC on April 28, 2022)
3.6
Articles of Amendment of InvenTrust Properties Corp. (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, as filed
by the Registrant with the SEC on May 8, 2023)
3.7
Fourth Amended and Restated Bylaws of the Company, dated as of May 5, 2023 (incorporated by reference to Exhibit 3.2 to the
Registrant’s Form 8-K, as filed by the Registrant with the SEC on May 8, 2023)
4.1
Statement regarding restrictions on transferability of shares of common stock (to appear on stock certificate or to be sent upon request
and without charge to stockholders issued shares without certificates) (incorporated by reference to Exhibit 4.4 to the Registrant’s
Amendment No. 1 to Form S-11 Registration Statement, as filed by the Registrant with the SEC on July 31, 2007 (file number
333-139504))
4.2
Third Amended and Restated Distribution Reinvestment Plan (incorporated by reference to Appendix A to the prospectus dated
November 1, 2019 included in Post-Effective Amendment No. 1 to the Registrant’s Registration Statement on Form S-3 (No.
333-172862) filed November 1, 2019)
4.3*
Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934
10.1
Indemnity Agreement, dated as of August 8, 2014, by and between Inland American Real Estate Trust, Inc., and Xenia Hotels &
Resorts, Inc., and Inland American Lodging Group, Inc. (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report
on Form 10-Q, as filed by the Registrant with the SEC on August 14, 2014)
10.2
First Amendment to Indemnity Agreement by and among Inland American Real Estate Trust, Inc. and Xenia Hotels & Resorts, Inc.,
dated as of February 3, 2015 (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K, as filed by the Registrant with the
SEC on February 9, 2015)
10.3.1^
InvenTrust Properties Corp. 2015 Incentive Award Plan (incorporated by reference to Exhibit 99.1 to the Registrant’s Form S-8
Registration Statement, as filed by the Registrant with the SEC on June 19, 2015)
10.3.2^
First Amendment to InvenTrust Properties Corp. 2015 Incentive Award Plan, dated May 6, 2016 (incorporated by reference to Exhibit
10.3 to the Registrant’s Form 10-Q, as filed by the Registrant with the SEC on August 15, 2016)
10.3.3^
Second Amendment to InvenTrust Properties Corp. 2015 Incentive Award Plan, dated March 20, 2024 (incorporated by reference to
Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on May 10, 2024)
10.4^
Form of Time-Based Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 10-Q, as
filed by the Registrant with the SEC on August 10, 2017)
10.5^
Form of Performance-Based Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K,
as filed by the Registrant with the SEC on May 14, 2019)
10.6^
Form of Performance-Based Restricted Stock Unit Award Agreement (2022) (incorporated by reference to Exhibit 10.1 to the
Registrant’s Form 8-K, as filed by the Registrant with the SEC on February 25, 2022)
10.7^*
Form of Director Restricted Stock Unit Agreement
10.8^
InvenTrust Properties Corp. Director Compensation Program, effective as of May 5, 2022 (incorporated by reference to Exhibit 10.18
to the Registrant’s Form 10-K, as filed by the Registrant with the SEC on February 21, 2023)
10.9^
InvenTrust Properties Corp. Executive Severance and Change of Control Plan (incorporated by reference to Exhibit 10.1 to the
Registrant’s Form 8-K, as filed by the Registrant on July 13, 2018)
10.10^
Form of Indemnification Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 10-Q, as filed by the
Registrant with the SEC on November 9, 2017)
10.11
Third Amended and Restated Share Repurchase Program (incorporated by reference to Exhibit 99.2 to the Registrant’s Current Report
on Form 8-K, as filed by the Registrant with the SEC on April 12, 2021)
10.12^
InvenTrust Properties Corp. 2023 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.1 to the Company’s Form
10-Q, as filed by the Company with the SEC on August 1, 2023)
10.13.1
Amended and Restated Term Loan Credit Agreement dated as of December 21, 2018, among InvenTrust Properties Corp., as
Borrower, Wells Fargo Bank, National Association, as Administrative Agent, Bank of America, N.A and U.S. Bank National
Association, as tranche A-1 Co-Syndication Agents, PNC Bank, National Association and U.S. Bank National Association, as tranche
A-2 Co-Syndication Agents, BMO Harris Bank, N.A. and Fifth Third Bank, as tranche A-1 Co-Documentation Agents, KeyBank
National Association, as tranche A-2 Documentation Agent, and the other lenders from time to time party thereto (incorporated by
reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on December 31, 2018)
10.13.2
First Amendment, dated as of September 22, 2021, to Amended and Restated Term Loan Credit Agreement, among InvenTrust
Properties Corp., Wells Fargo Bank, National Association and the other lenders party thereto (incorporated by reference to Exhibit 10.1
to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on September 22, 2021)
10.13.3
Second Amendment, dated as of May 11, 2022, to Amended and Restated Term Loan Credit Agreement, among InvenTrust Properties
Corp., the lenders party thereto and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 10.13.3 to the
Registrant's Form 10-K, as filed by the Registrant on February 14, 2024)
10.14.1
Second Amended and Restated Credit Agreement dated as of December 21, 2018, among InvenTrust Properties Corp., as borrower,
KeyBank National Association, as Administrative Agent, KeyBanc Capital Markets Inc. and Wells Fargo Securities, LLC, as Joint
Book Managers, KeyBanc Capital Markets Inc., Wells Fargo Securities, LLC, JPMorgan Chase Bank, N.A., Bank of America, N.A.,
PNC Bank, National Association, and BMO Harris Bank, N.A., as Joint Lead Arrangers, Wells Fargo Bank, National Association, and
JPMorgan Chase Bank, N.A., as Co-Syndication Agents, Bank of America, N.A., PNC Bank, National Association, and BMO Harris
Bank, N.A., as Co-Documentation Agents, and the other lenders from time to time party thereto (incorporated by reference to Exhibit
10.3 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on December 31, 2018)
EXHIBIT
NO.
DESCRIPTION
39
10.14.2
First Amendment, dated as of September 22, 2021, to Second Amended and Restated Credit Agreement, among InvenTrust Properties
Corp., KeyBank, National Association and the other lenders party thereto (incorporated by reference to Exhibit 10.2 to the Registrant's
Form 8-K, as filed by the Registrant with the SEC on September 22, 2021)
10.14.3
Second Amendment dated as of May 11, 2022 to Second Amended and Restated Credit Agreement, among InvenTrust Properties
Corp., the lenders party thereto and KeyBank National Association (incorporated by reference to Exhibit 10.14.3 to the Registrant's
Form 10-K, as filed by the Registrant on February 14, 2024)
10.14.4
Third Amendment dated as of October 23, 2024 to Second Amended and Restated Credit Agreement, among InvenTrust Properties
Corp., KeyBank National Association and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s
Form 8-K, as filed by the Registrant with the SEC on October 25, 2024)
10.15
Note Purchase Agreement, dated June 3, 2022, by and among InvenTrust Properties Corp. and the purchasers named therein
(incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, as filed by the Registrant with the SEC on June 3, 2022)
19.1*
InvenTrust Properties Corp. Insider Trading Compliance Policy
21.1*
Subsidiaries of the Registrant
23.1*
Consent of KPMG LLP
31.1*
Certification by Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*
Certification by Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**
Certification by Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**
Certification by Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1
InvenTrust Properties Corp. Policy for Recovery of Erroneously Awarded Compensation (incorporated by reference to Exhibit 97.1 to
the Registrant’s Form 10-K, as filed by the Registrant with the SEC on February 14, 2024)
101
The following financial information from our Annual Report for the year ended December 31, 2024, filed with the Securities and
Exchange Commission on February 13, 2025, is formatted in Extensible Business Reporting Language ("XBRL"): (i) Consolidated
Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Consolidated Statements of Equity,
(iv) Consolidated Statements of Cash Flows (v) Notes to Consolidated Financial Statements (tagged as blocks of text).
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*
Filed as part of this Annual Report
**
This certification is deemed furnished, and not filed, with the SEC and is not to be incorporated by reference into any filing of the
Registrant under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or
after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing.
^
Management contract or compensatory plan or arrangement.
EXHIBIT
NO.
DESCRIPTION
Item 16. Form 10-K Summary
None.
40
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
INVENTRUST PROPERTIES CORP.
By:
/s/ Daniel J. Busch
Name:
Daniel J. Busch
President and Chief Executive Officer
Date:
February 13, 2025
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
Date
By:
/s/ Daniel J. Busch
President, Chief Executive Officer and Director (Principal Executive Officer)
February 13, 2025
Name:
Daniel J. Busch
By:
/s/ Michael Phillips
Executive Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
February 13, 2025
Name:
Michael Phillips
By:
/s/ David Bryson
Senior Vice President, Chief Accounting Officer and Controller
(Principal Accounting Officer)
February 13, 2025
Name:
David Bryson
By:
/s/ Stuart Aitken
Director
February 13, 2025
Name:
Stuart Aitken
By:
/s/ Amanda Black
Director
February 13, 2025
Name:
Amanda Black
By:
/s/ Thomas F. Glavin
Director
February 13, 2025
Name:
Thomas F. Glavin
By:
/s/ Scott A. Nelson
Director
February 13, 2025
Name:
Scott A. Nelson
By:
/s/ Paula J. Saban
Director
February 13, 2025
Name:
Paula J. Saban
By:
/s/ Smita N. Shah
Director
February 13, 2025
Name:
Smita N. Shah
By:
/s/ Michael A. Stein
Director
February 13, 2025
Name:
Michael A. Stein
By:
/s/ Julian E. Whitehurst
Director
February 13, 2025
Name:
Julian E. Whitehurst
SIGNATURES
41
Consolidated Financial Statements and Supplementary Data
Page
Reports of Independent Registered Public Accounting Firm (PCAOB ID:185)
F-2
Financial Statements:
Consolidated Balance Sheets as of December 31, 2024 and 2023
F-5
Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended December 31, 2024, 2023 and 2022
F-6
Consolidated Statements of Equity for the years ended December 31, 2024, 2023 and 2022
F-7
Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023 and 2022
F-8
Notes to Consolidated Financial Statements
F-10
Schedule III - Real Estate and Accumulated Depreciation
F-29
All other schedules have been omitted as the information is inapplicable, not required, or the information is included elsewhere
in the consolidated financial statements or related notes thereto.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULE
F-1
Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors
InvenTrust Properties Corp.:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of InvenTrust Properties Corp. and subsidiaries (the Company)
as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive income (loss), equity,
and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes and financial
statement schedule III (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements
present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results
of its operations and its cash flows for each of the years in the three-year period ended December 31, 2024, in conformity with
U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in
Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway
Commission, and our report dated February 13, 2025 expressed an unqualified opinion on the effectiveness of the Company's
internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express
an opinion on these consolidated 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 Company 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 consolidated 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
consolidated 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 consolidated 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 consolidated 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 consolidated financial
statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or
disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or
complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated
financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate
opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Expected hold period of investment properties
As discussed in Note 2 to the consolidated financial statements, the Company assesses the carrying values of its investment
properties (including any related intangible assets or liabilities) on an individual basis when events or changes in
circumstances, including changes in the expected holding period, indicate their carrying value may not be fully
recoverable. If it is determined that the carrying value of the investment property is not recoverable because the expected
undiscounted cash flows do not exceed that carrying value of the property, the Company records an impairment loss to the
extent that the carrying value exceeds the estimated fair value. Net investment properties as of December 31, 2024 was
$2,327 million, or 88.3% of total assets.
F-2
We identified the assessment of the expected hold period for the investment properties evaluated for impairment as a
critical audit matter because of the significance of the estimate to the evaluation of the recoverability of the investment
properties. Changes in the expected hold period could have a material impact on the projected operating cash flows utilized
in the recoverability analysis for the investment property. Subjective and challenging auditor judgment was required to
evaluate the reasonableness of management’s assessment of expected hold period.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and
tested the operating effectiveness of internal controls related to the Company’s process to evaluate potential changes in the
estimated hold period of individual real estate properties. We evaluated the Company’s consideration of individual real
estate properties for potential reductions in expected hold period by:
•
Inquiring of Company officials to evaluate the likelihood that an investment property will be sold before the end of its
expected hold period.
•
Inspecting meeting minutes of the board of directors and the management investment committee to evaluate the
likelihood that an investment property will be sold before the end of its expected hold period.
•
Inquiring and obtaining representations from the Company regarding the status and evaluation of any potential
disposal of properties. We corroborated that information with others in the organization who are responsible for, and
have authority over, disposition activities and compared with the Company’s documented investment plans.
•
Reading external communications with investors in order to identify information regarding potential sales of the
Company’s properties, or other indicators of a reduction in an investment property’s expected hold period.
/s/ KPMG LLP
We have served as the Company’s auditor since 2005.
Chicago, Illinois
February 13, 2025
F-3
Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors
InvenTrust Properties Corp.:
Opinion on Internal Control Over Financial Reporting
We have audited InvenTrust Properties Corp. and subsidiaries' (the Company) internal control over financial reporting as of
December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee
of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects,
effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control -
Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated
statements of operations and comprehensive income (loss), equity, and cash flows for each of the years in the three-year period
ended December 31, 2024, and the related notes and financial statement schedule III (collectively, the consolidated financial
statements), and our report dated February 13, 2025 expressed an unqualified opinion on those consolidated financial
statements.
Basis for Opinion
The Company’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 Report
on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company'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 Company 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 of internal control over financial reporting included obtaining an understanding of internal control
over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our audit also included 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/ KPMG LLP
Chicago, Illinois
February 13, 2025
F-4
Consolidated Balance Sheets
(in thousands, except share amounts)
As of December 31
2024
2023
Assets
Investment properties
Land
$
712,827
$
694,668
Building and other improvements
2,116,092
1,956,117
Construction in progress
9,951
5,889
Total
2,838,870
2,656,674
Less accumulated depreciation
(511,969)
(461,352)
Net investment properties
2,326,901
2,195,322
Cash, cash equivalents and restricted cash
91,221
99,763
Intangible assets, net
137,420
114,485
Accounts and rents receivable
36,131
35,353
Deferred costs and other assets, net
44,277
42,408
Total assets
$
2,635,950
$
2,487,331
Liabilities
Debt, net
$
740,415
$
814,568
Accounts payable and accrued expenses
46,418
44,583
Distributions payable
17,512
14,594
Intangible liabilities, net
42,897
30,344
Other liabilities
28,703
29,198
Total liabilities
875,945
933,287
Commitments and contingencies
Stockholders' Equity
Preferred stock, $0.001 par value, 40,000,000 shares authorized, none outstanding
—
—
Common stock, $0.001 par value, 146,000,000 shares authorized,
77,450,794 shares issued and outstanding as of December 31, 2024 and
67,807,831 shares issued and outstanding as of December 31, 2023
77
68
Additional paid-in capital
5,730,367
5,468,728
Distributions in excess of accumulated net income
(3,984,865)
(3,932,826)
Accumulated comprehensive income
14,426
18,074
Total stockholders' equity
1,760,005
1,554,044
Total liabilities and stockholders' equity
$
2,635,950
$
2,487,331
See accompanying notes to the consolidated financial statements.
INVENTRUST PROPERTIES CORP.
F-5
Consolidated Statements of Operations and Comprehensive Income (Loss)
(in thousands, except share and per share amounts)
Year Ended December 31
2024
2023
2022
Income
Lease income, net
$
272,440
$
257,146
$
232,980
Other property income
1,534
1,450
1,161
Other fee income
—
80
2,566
Total income
273,974
258,676
236,707
Operating expenses
Depreciation and amortization
113,948
113,430
94,952
Property operating
43,413
42,832
40,239
Real estate taxes
36,441
34,809
32,925
General and administrative
33,172
31,797
33,342
Total operating expenses
226,974
222,868
201,458
Other (expense) income
Interest expense, net
(37,100)
(38,138)
(26,777)
Loss on extinguishment of debt
—
(15)
(181)
Impairment of real estate assets
(3,854)
—
—
Gain on sale of investment properties, net
3,857
2,691
38,249
Equity in (losses) earnings of unconsolidated entities
—
(557)
3,663
Other income and expense, net
3,755
5,480
2,030
Total other (expense) income, net
(33,342)
(30,539)
16,984
Net income
$
13,658
$
5,269
$
52,233
Weighted-average common shares outstanding, basic
70,394,448
67,531,898
67,406,233
Weighted-average common shares outstanding, diluted
71,010,568
67,813,180
67,525,935
Net income per common share - basic
$
0.19
$
0.08
$
0.77
Net income per common share - diluted
$
0.19
$
0.08
$
0.77
Comprehensive income
Net income
$
13,658
$
5,269
$
52,233
Unrealized gain on derivatives
9,019
6,228
32,052
Reclassification to net income
(12,667)
(14,875)
(1,009)
Comprehensive income (loss)
$
10,010
$
(3,378) $
83,276
See accompanying notes to the consolidated financial statements.
INVENTRUST PROPERTIES CORP.
F-6
Consolidated Statements of Equity
(in thousands, except share amounts)
Number of
Shares
Common
Stock
Additional
Paid-in
Capital
Distributions
in Excess of
Accumulated
Net Income
Accumulated
Comprehensive
Income (Loss)
Total
Beginning balance, January 1, 2022
67,344,374 $
67 $
5,452,550 $ (3,876,743) $
(4,322) $
1,571,552
Net income
—
—
—
52,233
—
52,233
Unrealized gain on derivatives
—
—
—
—
32,052
32,052
Reclassification from interest expense, net
—
—
—
—
(405)
(405)
Reclassification from equity in earnings of unconsolidated entities
—
—
—
—
(604)
(604)
Distributions declared ($0.8208 per common share)
—
—
—
(55,337)
—
(55,337)
Stock-based compensation, net
128,179
—
4,418
—
—
4,418
Ending balance, December 31, 2022
67,472,553
67
5,456,968
(3,879,847)
26,721
1,603,909
Net income
—
—
—
5,269
—
5,269
Unrealized gain on derivatives
—
—
—
—
6,228
6,228
Reclassification from interest expense, net
—
—
—
—
(14,875)
(14,875)
Distributions declared ($0.8620 per common share)
—
—
—
(58,248)
—
(58,248)
Stock-based compensation, net
127,238
1
7,427
—
—
7,428
Issuance of common stock under ATM Program, net
208,040
—
4,333
—
—
4,333
Ending balance, December 31, 2023
67,807,831
68
5,468,728
(3,932,826)
18,074
1,554,044
Net income
—
—
—
13,658
—
13,658
Unrealized gain on derivatives
—
—
—
—
9,019
9,019
Reclassification from interest expense, net
—
—
—
—
(12,667)
(12,667)
Distributions declared ($0.9052 per common share)
—
—
—
(65,697)
—
(65,697)
Issuance of common stock under offering, net
9,200,000
9
245,834
—
—
245,843
Issuance of common stock under ATM Program, net
254,082
—
7,620
—
—
7,620
Stock-based compensation, net
188,881
—
8,185
—
—
8,185
Ending balance, December 31, 2024
77,450,794 $
77 $
5,730,367 $ (3,984,865) $
14,426 $
1,760,005
See accompanying notes to the consolidated financial statements.
INVENTRUST PROPERTIES CORP.
F-7
Cash flows from operating activities:
Net income
$
13,658
$
5,269
$
52,233
Adjustments to reconcile to net cash provided by operating activities:
Depreciation and amortization
113,948
113,430
94,952
Amortization of market-lease intangibles and inducements, net
(2,804)
(3,343)
(5,589)
Amortization of debt discounts and financing costs
2,403
4,113
2,816
Straight-line rent adjustments, net
(3,400)
(3,349)
(3,815)
Impairment of real estate assets
3,854
—
—
Provision for (reversal of) estimated credit losses
430
1,033
(267)
Gain on sale of investment properties, net
(3,857)
(2,691)
(38,249)
Loss on extinguishment of debt
—
15
181
Equity in losses (earnings) of unconsolidated entities
—
557
(3,663)
Distributions from unconsolidated entities
—
—
9,350
Stock-based compensation, net
9,896
9,021
6,541
Changes in operating assets and liabilities:
Accounts and rents receivable
1,512
1,483
(999)
Deferred costs and other assets, net
(236)
91
317
Accounts payable and accrued expenses
511
2,054
8,411
Other liabilities
961
1,938
3,576
Net cash provided by operating activities
136,876
129,621
125,795
Cash flows from investing activities:
Purchase of investment properties
(268,125)
(152,047)
(235,001)
Capital investments and leasing costs
(36,116)
(35,744)
(33,183)
Proceeds from the sale of investment properties, net
65,062
12,559
77,538
Distributions from unconsolidated entities
—
95,065
47,355
Other investing activities, net
(1,356)
449
(1,170)
Net cash used in investing activities
(240,535)
(79,718)
(144,461)
Cash flows from financing activities:
Payment of tax withholdings for share-based compensation
(2,598)
(1,583)
(1,581)
Proceeds from sale of common stock under offering
257,600
—
—
Proceeds from sale of common stock under ATM Program
8,138
5,165
—
Proceeds from sale of common stock under ESPP
280
235
—
Payment of common stock offering costs
(12,078)
(341)
—
Distributions to stockholders
(62,779)
(57,491)
(55,302)
Proceeds from line of credit
10,000
30,000
112,000
Repayments of line of credit
(10,000)
(30,000)
(143,000)
Proceeds from senior notes
—
—
250,000
Payoffs of debt
(88,168)
(33,700)
(47,052)
Principal payments on mortgage debt
—
(32)
(842)
Payment of financing costs
(5,278)
(175)
(2,387)
Other financing activities
—
20
(262)
Net cash provided by (used in) financing activities
95,117
(87,902)
111,574
Net decrease in cash, cash equivalents and restricted cash
(8,542)
(37,999)
92,908
Cash, cash equivalents and restricted cash at beginning of year
99,763
137,762
44,854
Cash, cash equivalents and restricted cash at end of year
$
91,221
$
99,763
$
137,762
Year Ended December 31
2024
2023
2022
INVENTRUST PROPERTIES CORP.
Consolidated Statements of Cash Flows
(in thousands)
F-8
Supplemental disclosure of cash flow information:
Cash flow disclosure, including non-cash investing and financing activities:
Cash paid for interest, net of capitalized interest
$
35,605
$
33,093
$
18,705
Cash paid (refunded) for income taxes, net of (payments) refunds
530
209
(386)
Previously held equity investments in real estate assets acquired
—
39,603
—
Distributions payable to stockholders
17,512
14,594
13,837
Accrued capital investments and leasing costs
3,620
2,562
3,136
Capitalized costs placed in service
14,948
16,402
17,895
Gross issuance of shares for share-based compensation
7,662
4,558
6,224
Purchase of investment properties:
Net investment properties
$
245,355
$
200,085
$
280,938
Accounts and rents receivable, lease intangibles, and deferred
costs and other assets
54,041
52,871
47,019
Accounts payable and accrued expenses, lease intangibles, and
other liabilities
(18,681)
(9,133)
(13,075)
Assumption of mortgage debt, at fair value
(12,590)
(91,776)
(79,881)
Cash outflow for purchase of investment properties, net
268,125
152,047
235,001
Assumption of mortgage principal
13,000
92,468
80,380
Capitalized acquisition costs
(1,116)
(150)
(1,079)
Credits, prorations, and other changes in cash outflow, net
2,061
(365)
4,768
Gross acquisition price of investment properties
$
282,070
$
244,000
$
319,070
Sale of investment properties:
Net investment properties
$
59,912
$
10,086
$
66,294
Accounts and rents receivable, lease intangibles, and deferred
costs and other assets
1,564
297
4,200
Accounts payable and accrued expenses, lease intangibles, and
other liabilities
(271)
(515)
(2,575)
Debt assumed by buyer through disposition of property
—
—
(28,552)
Gain on sale of investment properties, net
3,857
2,691
38,249
Loss on extinguishment of debt
—
—
(78)
Proceeds from sale of investment properties, net
65,062
12,559
77,538
Assumption of mortgage principal
—
—
28,630
Credits, prorations, and other changes in cash inflow, net
3,490
583
4,282
Gross disposition price of investment properties
$
68,552
$
13,142
$
110,450
Year Ended December 31
2024
2023
2022
See accompanying notes to the consolidated financial statements.
INVENTRUST PROPERTIES CORP.
Consolidated Statements of Cash Flows
(in thousands)
F-9
1. Organization
On October 4, 2004, InvenTrust Properties Corp. (the "Company" or "InvenTrust") was incorporated as Inland American Real
Estate Trust, Inc., a Maryland corporation, and elected to operate in a manner to be taxed as a real estate investment trust
("REIT") for federal tax purposes. The Company changed its name to InvenTrust Properties Corp. in April of 2015 and is
focused on owning, leasing, redeveloping, acquiring and managing a multi-tenant retail platform.
The accompanying consolidated financial statements include the accounts of the Company, as well as all wholly-owned
subsidiaries. Subsidiaries generally consist of limited liability companies ("LLCs") and limited partnerships ("LPs"). All
significant intercompany balances and transactions have been eliminated. Each retail property is owned by a separate legal
entity that maintains its own books and financial records. Each separate legal entity's assets are not available to satisfy the
liabilities of other affiliated entities.
The Company has a single reportable segment, multi-tenant retail, for disclosure purposes in accordance with United States
("U.S.") generally accepted accounting principles ("GAAP"). Unless otherwise noted, all square feet and dollar amounts are
stated in thousands, except share, per share and per square foot data. Number of properties and square feet are unaudited.
The following table summarizes the Company's retail portfolio as of December 31, 2024 and 2023:
As of December 31
2024
2023
No. of properties
68
62
Gross Leasable Area (square feet)
10,972
10,324
2. Basis of Presentation and Summary of Significant Accounting Policies
Estimates, Risks, and Uncertainties
The accompanying consolidated financial statements have been prepared in accordance with GAAP, which requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and
expenses during the reporting periods. Significant estimates, judgments and assumptions are required in a number of areas,
including, but not limited to, evaluating the impairment of long-lived assets, allocating the purchase price of acquired retail
properties, determining the fair value of debt and evaluating the collectability of accounts receivable. The Company bases these
estimates, judgments and assumptions on historical experience and various other factors that the Company believes to be
reasonable under the circumstances. Actual results may differ from these estimates.
Variable Interest Entities
The Company evaluates its investments in LLCs and LPs to determine whether each such entity may be a variable interest
entity ("VIE"). The accounting standards related to the consolidation of VIEs require qualitative assessments to determine
whether the Company is the primary beneficiary. Determination of the primary beneficiary is based on whether the Company
has (i) power to direct significant activities of the VIE and (ii) an obligation to absorb losses or the right to receive benefits that
could be potentially significant to the VIE. The Company consolidates a VIE if it is deemed to be the primary beneficiary. The
equity method of accounting is applied to entities in which the Company is not the primary beneficiary, or if the entity is not a
VIE and the Company does not have control, but can exercise significant influence over the entity with respect to its operations
and major decisions. As of December 31, 2024 and 2023, the Company had no VIEs.
Revenue Recognition
Lease Income
The majority of revenue recognized from the Company's retail properties is comprised of fixed and variable consideration
received from tenants under long-term operating leases with varying terms. Fixed consideration generally consists of minimum
lease payments for the rental of retail space while the variable consideration generally consists of reimbursements of the tenant's
pro-rata share of certain operating expenses incurred by the Company, including real estate taxes, special assessments,
insurance, utilities, common area maintenance, management fees and certain capital repairs. Certain other tenants are subject to
net leases whereby the tenant is responsible for fixed minimum lease payments to the Company, as well as directly paying all
costs and expenses associated with occupancy to third party service providers. Such direct payments to third parties are not
recorded as revenue and expense by the Company.
INVENTRUST PROPERTIES CORP.
Notes to Consolidated Financial Statements
December 31, 2024, 2023 and 2022
F-10
In accordance with Accounting Standards Codification ("ASC") 842, Leases, ("Topic 842"), the Company has elected to not
separate lease and non-lease components for all qualifying leases. In effect, this generally relieves the Company from
accounting for certain consideration under ASC 606, Revenue from Contracts with Customers ("Topic 606"). As a result of the
election, all income arising from leases is presented on a combined basis as lease income, net.
Minimum lease payments are recognized on a straight-line basis over the term of each lease. The cumulative difference between
fixed consideration recognized on a straight-line basis and the cash payments due under the provisions of the lease agreements
is recorded as deferred rent receivable and is included as a component of accounts and rents receivable.
The Company records lease termination income when all conditions of a signed termination agreement have been met, the
tenant is no longer occupying the property, and termination income amounts due are considered collectible. The Company
defers recognition of contingent lease income until the specified target that triggers the contingent lease income is achieved.
The Company commences revenue recognition on its leases when the lessee takes possession of, or controls the physical use of,
the leased asset, unless the lessee is constructing improvements for which the Company is deemed to be the owner for
accounting purposes. If the Company is deemed the owner for accounting purposes, the leased asset is the finished space and
revenue recognition commences when the lessee takes possession of it, typically when the improvements are substantially
complete. Alternatively, if the lessee is deemed to be the owner of the improvements for accounting purposes, then the leased
asset is the unimproved space, and any tenant improvement allowances funded under the lease are treated as lease incentives,
which reduce lease income recognized over the lease term, and the Company commences revenue recognition when the lessee
takes possession of the unimproved space.
The determination of who owns the tenant improvements, for accounting purposes, is based on contractual rights and subject to
judgment. In making that judgment, no one factor is determinative. The Company routinely considers:
•
whether the lease stipulates how and on what a tenant improvement allowance may be spent;
•
whether the tenant is required to provide evidence supporting the cost of improvements prior to reimbursement;
•
whether the tenant or landlord retains legal title to the improvements;
•
the uniqueness of the improvements;
•
the expected economic life of the tenant improvements relative to the length of the lease; and
•
who constructs or directs the construction of the improvements.
Credit Losses
The Company reviews the collectability of amounts due from its tenants on a regular basis. Such reviews consider the tenant's
financial condition and payment history and other economic conditions impacting the tenant. Changes in collectability occur
when the Company no longer believes it is probable that substantially all the lease payments will be collected over the term of
the lease. If collection is not probable, the lease payments will be accounted for on a cash basis and revenue will be recorded as
cash is received. If reassessed, and the collection of substantially all of the lease payments from the tenant becomes probable,
the accrual basis of revenue recognition is reestablished. The provision for estimated credit losses resulting from changes in the
expected collectability of lease payments, including variable payments, is recognized as a direct adjustment to lease income,
and a direct write-off of the operating lease receivables, including straight-line rent receivable.
Sale of Real Estate
The Company derecognizes real estate and recognizes a gain or loss when a contract exists and control of the property has
transferred to the buyer. Control of the property, including controlling financial interest, is generally considered to transfer upon
closing through transfer of the legal title and possession of the property, at which point the Company recognizes a gain or loss
equal to the difference between the transaction price and the carrying amount of the property.
Acquisition of Real Estate
The Company evaluates the inputs, processes and outputs of each asset acquired to determine if the transaction is a business
combination or asset acquisition. If an acquisition qualifies as a business combination, the related transaction costs are
expensed. If an acquisition qualifies as an asset acquisition, the related transaction costs are capitalized and amortized over the
useful life of the acquired assets. Generally, the Company's acquisitions of real estate qualify as asset acquisitions.
F-11
The Company allocates the purchase price of real estate to land, building, other building improvements, tenant improvements,
intangible assets and liabilities (such as the value of above- and below-market leases, and in-place leases). The values of above-
and below-market leases are recorded as intangible assets and intangible liabilities, respectively, and are amortized as either a
decrease (in the case of above-market leases) or an increase (in the case of below-market leases) to lease income, net over the
remaining term of the associated lease. The values, if any, associated with in-place leases are recorded as intangible assets and
amortized to depreciation and amortization expense over the remaining lease term.
The difference between the contractual rental rates and the Company's estimate of market rental rates is measured over a period
equal to the remaining non-cancelable term of the leases plus the term of any below-market renewal options. For the
amortization period, the remaining term of leases with renewal options at terms below market reflect the assumed exercise of
such below-market renewal options, if reasonably assured.
If a tenant vacates its space prior to the contractual expiration of the lease and no rental payments are being made on the lease,
any unamortized balance of the related intangible asset or liability is written off. Tenant improvements are depreciated and
origination costs are amortized over the remaining term of the lease or charged against earnings if the lease is terminated prior
to its contractual expiration date.
With the assistance of a third-party valuation specialist, the Company performs the following procedures for assets acquired:
•
Estimate the value of the property "as if vacant" as of the acquisition date;
•
Allocate the value of the property among land, building, and other building improvements and determine the
associated useful life for each;
•
Calculate the value and associated life of above- and below-market leases on a tenant-by-tenant basis. The difference
between the contractual rental rates and the Company’s estimate of market rental rates is measured over a period equal
to the remaining term of the leases (using a discount rate which reflects the risks associated with the leases acquired,
including geographical location, size of leased area, tenant profile and credit risk);
•
Estimate the fair value of the tenant improvements, legal costs and leasing commissions incurred to obtain the leases
and calculate the associated useful life for each;
•
Estimate the fair value of assumed debt, if any; and
•
Estimate the intangible value of the in-place leases based on lease execution costs of similar leases as well as lost rent
payments during an assumed lease-up period and their associated useful lives on a tenant-by-tenant basis.
Properties Held for Sale
In determining whether to classify a property as held for sale, the Company considers whether: (i) management has committed
to a plan to sell the property; (ii) the property is available for immediate sale, in its present condition; (iii) the Company has
initiated a program to locate a buyer; (iv) the Company believes that the sale of the property is probable; (v) the Company has
received a significant non-refundable deposit for the purchase of the property; (vi) the Company is actively marketing the
property for sale at a price that is reasonable in relation to its estimated fair value; and (vii) actions required for the Company to
complete the plan indicate that it is unlikely that any significant changes will be made to the plan. When all criteria are met, the
property is classified as held for sale and carried at the lower of cost or estimated fair value less costs to sell. Additionally, if the
sale represents a strategic shift that has (or will have) a major effect on the Company's results and operations, the income and
expenses for the period are classified as discontinued operations for all periods presented.
Impairment of Long Lived Assets
The Company assesses the carrying values of long-lived tangible and intangible assets whenever events or changes in
circumstances indicate that they may not be fully recoverable, such as a reduction in the expected hold period of a property.
When such event or circumstances occur, if it is expected that the carrying value is not recoverable because the expected
undiscounted cash flows do not exceed that carrying value, the Company recognizes an impairment loss to the extent that the
carrying value exceeds the estimated fair value. The valuation and possible subsequent impairment of investment properties is a
significant estimate that can and does change based on the Company's continuous process of analyzing each property's
economic condition over time and reviewing and updating assumptions about uncertain inherent factors, including observable
inputs such as contractual revenues and unobservable inputs such as forecasted revenues and expenses, estimated net
disposition proceeds, and discount rate. These unobservable inputs are based on a property's market conditions and expected
growth rates. Assumptions and estimates about future cash flows and capitalization rates are complex and subjective. Changes
in economic and operating conditions and the Company's ultimate investment intent that occur subsequent to the impairment
analyses could impact these assumptions and result in additional impairment.
F-12
The Company's assessment of expected hold period for investment properties evaluated for impairment is of particular
significance because of the material impact it has on the evaluation of the property's recoverability. Changes in the Company's
disposition strategy or changes in the marketplace may alter the hold period of an asset or asset group which may result in an
impairment loss and such loss could be material to the Company's financial condition or operating performance.
Real Estate Capitalization and Depreciation
Real estate is reflected at cost less accumulated depreciation within investment properties on the consolidated balance sheets.
Ordinary repairs and maintenance are expensed as incurred. Depreciation expense is computed using the straight-line method.
A range of estimated useful lives of 15-30 years is used for buildings and other improvements, and a range of 3-20 years is used
for furniture, fixtures and equipment.
Tenant improvements are amortized on a straight-line basis over the lesser of the life of the tenant improvement or the lease
term. Amortization is included in depreciation and amortization expense. Deferred leasing costs are recognized as a part of
deferred costs and other assets, net and are amortized to depreciation and amortization expense over the remaining term of the
associated tenant lease.
Direct and indirect costs that are clearly related to the construction and improvements of investment properties are capitalized.
Costs incurred for interest, property taxes and insurance are capitalized during periods in which activities necessary to prepare
the property for its intended use are in progress.
Cash, Cash Equivalents and Restricted Cash
The Company considers all demand deposits, money market accounts and investments in certificates of deposit and repurchase
agreements with a maturity of three months or less, at the date of purchase, to be cash equivalents. The Company maintains its
cash and cash equivalents at financial institutions. The combined account balances at one or more institutions generally exceed
the Federal Deposit Insurance Corporation ("FDIC") insurance coverage. The Company periodically assesses the credit risk
associated with these financial institutions. The Company believes insignificant credit risk exists related to amounts on deposit
in excess of FDIC insurance coverage.
The Company had restricted cash of $3,826 and $3,378 as of December 31, 2024 and 2023, respectively. Restricted cash often
consists of lenders' escrows, operating real estate escrows for taxes, insurance, capital expenditures, payments required under
certain lease agreements, funds restricted through the Company's wholly-owned captive insurance company, and funds held in
escrow for future acquisitions.
Fair Value Measurements
In accordance with ASC 820, Fair Value Measurement and Disclosures ("Topic 820"), the Company defines fair value based
on the price that would be received upon sale of an asset or the exit price that would be paid to transfer or settle a liability in an
orderly transaction between market participants at the measurement date. The Company uses a fair value hierarchy that
prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy consists of the three broad
levels described below:
•
Level 1 - Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
•
Level 2 - Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and
liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or
other inputs that are observable or can be corroborated by observable market data.
•
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value
of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar
techniques that use significant unobservable inputs.
The Company has estimated the fair value of its financial instruments and non-financial assets using available market
information and valuation methodologies the Company believes to be appropriate for these purposes. Considerable judgment
and a high degree of subjectivity are involved in developing these estimates and, accordingly, they are not necessarily indicative
of amounts that would be realized upon disposition.
The carrying amounts of cash, cash equivalents and restricted cash, accounts and rents receivables, other assets, accounts
payable, accrued expenses, and other liabilities reasonably approximate fair value, in management’s judgment, because of their
short-term nature. Fair value information pertaining to derivative financial instruments, investment properties, and debt is
provided in "Note 9. Fair Value Measurements".
F-13
Stock-Based Compensation Plans
Incentive Award Plan
Effective June 19, 2015, the Company's board of directors (the "Board") adopted the InvenTrust Properties Corp. 2015
Incentive Award Plan (the "Incentive Award Plan"), under which the Company may grant cash and equity incentive awards to
eligible employees, directors, and consultants. The Company has awarded time-based restricted stock units ("RSUs"),
performance-based RSUs, and market-based RSUs with tandem dividend equivalents. Compensation expense related to these
awards, which are generally equity classified, is recognized as a part of general and administrative expense. The tandem
dividend equivalent cash payments of awards granted during the years ended December 31, 2024, 2023, and 2022 are
recognized within equity. The tandem dividend equivalent cash payments of awards granted during the year ended December
31, 2021 are recognized within earnings. Forfeitures of awards are recognized as they occur.
Time-based awards are generally measured at grant date fair value and not subsequently re-measured. Compensation expense
related to these awards is recognized on a straight-line basis over the vesting period. Time-based awards granted to employees
vest equally on each of the first three or four anniversaries of the applicable vesting commencement date, subject to the
employees' continued service to the Company. The time-based RSU awards granted to directors vest on the earlier of the one-
year anniversary of the applicable grant date or the date of the Company's next annual meeting of its shareholders following the
grant date, subject to the directors' continued service to the Company.
Performance-based awards are measured at grant date fair value and each grantee is eligible to vest in a number of RSUs
ranging from 0% to 100% of the total number granted based on specified performance levels. Shares related to performance-
based awards are issued within 45 days of the conclusion of the performance period and are generally subject to the recipients'
continued service to the Company. Compensation cost is recognized when the performance condition is considered probable of
achievement. If a performance award has more than one potential outcome, recognition of compensation cost is based on the
most likely outcome. During the service period, a cumulative catch-up approach is used to account for changes in the
assessment of which outcome is most likely to occur.
Market-based awards are valued as of the grant date utilizing a Monte Carlo simulation model that assesses the probability of
satisfying certain market performance thresholds over a three year performance period. Shares related to market-based awards
are issued within 65 days of the conclusion of the performance period and are generally subject to the recipients' continued
service to the Company. The number of common shares ultimately issued is based on the Company's total shareholder return
("TSR") relative to that of the FTSE Nareit Shopping Index peer group on a percentile basis. The resulting compensation
expense is recorded over the service period regardless of whether the TSR performance measures are achieved.
Employee Stock Purchase Plan
Effective May 4, 2023, the Company's Board established an Employee Stock Purchase Plan (the "ESPP") through which
employees may purchase shares of the Company's common stock semi-annually at a price equal to 85% of the lesser of: (a) the
closing price per share on the first day of such period, and (b) the closing price per share on the last day of such period.
Compensation expense related to the ESPP is recognized as a part of general and administrative expense.
Derivative Instruments
In the normal course of business, the Company is exposed to the effect of interest rate changes. The Company's objective in
using interest rate derivatives is to manage its exposure to interest rate movements and add stability to interest expense. To
accomplish this objective, the Company uses interest rate swaps as part of its interest rate risk management strategy. Interest
rate swaps designated as cash flow hedges involve the receipt of variable rate amounts from a counterparty in exchange for the
Company making fixed rate payments over the life of the agreement without exchange of the underlying notional amount.
The Company has a policy of only entering into contracts with established financial institutions based upon their credit ratings
and other factors. When viewed in conjunction with the underlying and offsetting exposure that the derivatives are designed to
hedge, the Company has not sustained a material loss from those instruments, nor does it anticipate any material adverse effect
on its net income or financial position in the future from the use of derivatives.
The Company recognizes all derivatives on the consolidated balance sheets at fair value. Additionally, changes in fair value will
affect either equity or earnings depending on whether the derivative instruments qualify as a hedge for accounting purposes
and, if so, the nature of the hedging activity. When the underlying transaction is terminated or completed, all changes in the fair
value of the instrument are marked-to-market with changes in value included in earnings each period until the instrument
matures. Any derivative instrument used for risk management that does not meet the criteria for hedge accounting is marked-to-
market each period in earnings. The Company does not use derivatives for trading or speculative purposes.
F-14
Income Taxes
The Company has elected and operates in a manner to be taxed as a REIT under the Internal Revenue Code of 1986, as
amended (the "Code") for federal income tax purposes commencing with the tax year ended December 31, 2005. To qualify as
a REIT, the Company is generally required to distribute at least 90% of its REIT taxable income (subject to certain adjustments)
to its stockholders each year (the "90% Distribution Requirement"). As a REIT, the Company is entitled to a tax deduction for
some or all of the dividends paid to stockholders. Accordingly, the Company generally will not be subject to federal income
taxes as long as it currently distributes to stockholders an amount equal to or in excess of the Company's taxable income. If the
Company fails to qualify as a REIT in any taxable year, without the benefit of certain relief provisions, the Company will be
subject to federal and state income tax on its taxable income at regular corporate tax rates. Even if the Company qualifies for
taxation as a REIT, the Company may be subject to certain state and local taxes on its income, property or net worth and federal
income and excise taxes on its undistributed income.
From time to time, the Company may elect to treat certain of its consolidated subsidiaries as taxable REIT subsidiaries
("TRSs") pursuant to the Code. Among other activities, TRSs may participate in non-real estate related activities and/or perform
non-customary services for tenants and are subject to federal and state income tax at regular corporate tax rates. Income tax
expense or benefit is recognized as a part of other income and expense, net. During the years ended December 31, 2024, 2023,
and 2022 the Company did not have any operations within TRSs.
Income tax expense for the years ended December 31, 2024, 2023 and 2022 generally pertains to Texas margin tax. The
Company has accrued no material interest or penalties relating to income taxes. As of December 31, 2024, the Company's 2024,
2023, and 2022 tax years remain subject to examination by U.S. and various state tax jurisdictions.
Recently Issued Accounting Pronouncements Adopted
Standard
Description
Date of adoption
Effect on the financial statements
or other significant matters
ASU No. 2023-07
Improvements to
Reportable Segment
Disclosures (Topic 280)
The Accounting Standards Update ("ASU") is intended
to improve financial reporting by requiring enhanced
disclosures about significant segment expenses that are
regularly provided to the chief operating decision maker
so investors can better understand an entity's overall
performance and assess future cash flows.
In addition, the amendments enhance interim disclosure
requirements, clarify circumstances in which an entity
can disclose multiple segment measures of profit or
loss, provide new segment disclosure requirements for
entities with a single reportable segment, and contain
other disclosure requirements.
January 2024
The Company has evaluated this
guidance and determined that its
impact is limited to incremental
disclosure and will not have an impact
on the Company's financial position,
results of operations, or cash flows.
The incremental disclosures pertaining
to the Company's single reportable
segment have been included in "Note
12. Segment Information".
Recently Issued Accounting Pronouncements Not Yet Adopted
Standard
Description
Effective date
Effect on the financial statements
or other significant matters
ASU No. 2024-03
Disaggregation of
Income Statement
Expenses (Subtopic
220-40) and related
updates
The ASU is intended to improve financial reporting by
requiring more granular disclosures about an entity’s
expenses so investors can better understand
performance, prospects for future cash flows and
comparability over time.
The primary goal is to improve the decision-usefulness
of expense information through disaggregation of
relevant expense captions in the notes to the financial
statements.
Annual reporting
periods beginning
after December 15,
2026, and interim
periods within
annual reporting
periods beginning
after December 15,
2027.
The Company continues to evaluate
this guidance and expects the impact to
be limited to incremental disclosure.
The Company does not expect the
standard to have an impact on the
Company's financial position, results of
operations, or cash flows.
Other recently issued accounting standards or pronouncements not disclosed in the foregoing tables have been excluded
because they are either not relevant to the Company, or are not expected to have, or did not have, a material effect on the
consolidated financial statements of the Company.
F-15
3. Revenue Recognition
Operating Leases
Minimum lease payments to be received under long-term operating leases and short-term specialty leases, excluding additional
percentage rent based on tenants' sales volume and tenant reimbursements of certain operating expenses, and assuming no
exercise of renewal options or early termination rights, are as follows:
For the year ending December 31,
As of December 31, 2024
2025
$
209,875
2026
195,712
2027
163,117
2028
136,608
2029
106,862
Thereafter
377,780
Total
$
1,189,954
The foregoing table includes payments from tenants who have taken possession of their space and tenants who have been
moved to the cash basis of accounting for revenue recognition purposes. The remaining lease terms range from less than one
year to fifty-six years.
The following table reflects the disaggregation of lease income, net:
Year Ended December 31
2024
2023
2022
Minimum base rent
$
175,068
$
165,267
$
145,467
Real estate tax recoveries
33,343
31,220
30,107
Common area maintenance, insurance, and other recoveries
33,003
30,731
28,072
Ground rent income
19,321
19,044
14,991
Amortization of market-lease intangibles and inducements, net
2,804
3,343
5,589
Short-term and other lease income
4,567
4,389
4,333
Lease termination income
1,364
836
339
Straight-line rent adjustments, net
3,400
3,349
3,815
(Provision for) reversal of uncollectable billed rent and recoveries
(430)
(1,033)
267
Lease income, net
$
272,440
$
257,146
$
232,980
F-16
4. Acquired Properties
The following table reflects the retail properties acquired during the year ended December 31, 2024:
Date
Property
Market
Square
Feet
Gross
Acquisition
Price
Intangible
Assets
Intangible
Liabilities
Assumption of
Mortgage Debt
2/1/24
The Plant (a)
Phoenix, AZ
57
$
29,500
$
4,467
$
540 $
13,000
4/9/24
Moores Mill
Atlanta Metro Area, GA
70
28,000
6,710
1,451
—
6/13/24
Maguire Groves (b)
Orlando-Kissimmee, FL
33
16,100
1,652
406
—
8/6/24
Scottsdale North
Marketplace
Phoenix, AZ
66
23,000
2,691
1,295
—
10/9/24
Stonehenge Village
Richmond, VA
214
62,100
10,630
3,725
—
11/26/24
The Forum
Cape Coral-Fort Myers,
FL
186
41,370
12,359
2,736
—
12/18/24
Market at Mill
Creek
Charleston-Berkeley-
Dorchester, SC
80
27,300
6,109
1,432
—
12/18/24
Nexton Square
Charleston-Berkeley-
Dorchester, SC
134
54,700
9,410
5,850
—
840
$
282,070 $
54,028 $
17,435 $
13,000
(a)
The Company recognized a fair value adjustment of $410 related to the mortgage payable secured by the property.
(b)
Maguire Groves is immediately adjacent to Plantation Grove, a Publix anchored neighborhood center wholly-owned by the Company. The
Company operates these properties under the Plantation Grove name.
The following table reflects the retail properties acquired during the year ended December 31, 2023:
Date
Property
Market
Square
Feet
Gross
Acquisition
Price
Intangible
Assets
Intangible
Liabilities
Assumption of
Mortgage Debt
1/18/23
Bay Colony (a)
Houston-Sugar Land-
Baytown, TX
416
$
79,100
$
16,586
$
1,937 $
41,969
1/18/23
Blackhawk Town
Center (a)
Houston-Sugar Land-
Baytown, TX
127
26,300
3,123
184
13,008
1/18/23
Cyfair Town Center
(a)
Houston-Sugar Land-
Baytown, TX
433
79,200
17,229
4,160
30,880
1/18/23
Stables Town
Center (a)
Houston-Sugar Land-
Baytown, TX
148
37,000
8,155
676
6,611
6/2/23
The Shoppes at
Davis Lake
Charlotte-Gastonia-
Concord, NC
91
22,400
3,551
123
—
1,215
$
244,000 $
48,644 $
7,080 $
92,468
(a)
These retail properties were acquired from the Company's former unconsolidated joint venture. See "Note 6. Investment in Unconsolidated
Entities". The Company recognized a fair value adjustment of $692 related to the pooled mortgage debt on these properties.
Retail properties acquired during the years ended December 31, 2024 and 2023 were accounted for as asset acquisitions.
The Company capitalized acquisition costs of $1,116 and $150 for retail properties acquired during the years ended
December 31, 2024 and 2023, respectively.
F-17
5. Disposed Properties
The following table reflects the real property disposed of during the year ended December 31, 2024:
Date
Property
Market
Square Feet
Gross
Disposition Price
Gain (Loss)
on Sale, net
7/22/24
Eldridge Town Center &
Windermere Village (a)
Houston - Sugar Land - Baytown, TX
N/A
$
602
$
334
10/31/24
Stevenson Ranch
So. California - Los Angeles, CA
187
57,800
(614)
12/13/24
Eldridge Town Center &
Windermere Village (b)
Houston - Sugar Land - Baytown, TX
31
10,150
4,137
218
$
68,552
$
3,857
(a)
This disposition was related to the completion of a partial condemnation at one retail property.
(b)
This disposition included the sale of an outparcel at Eldridge Town Center and the entirety of Windermere Village. Subsequent to the
transaction, the Company continues to operate the remaining property under the Eldridge Town Center name.
The following table reflects the real property disposed of during the year ended December 31, 2023:
Date
Property
Market
Square Feet
Gross
Disposition Price
Gain on Sale
06/20/23
Shops at Galleria (a)
Austin - Round Rock, TX
N/A
$
1,692
$
984
8/25/23
Trowbridge Crossing
Atlanta Metro Area, GA
63
11,450
1,707
63
$
13,142
$
2,691
(a)
This disposition was related to the completion of a partial condemnation at one retail property.
6. Investment in Unconsolidated Entities
Joint Venture Interest in IAGM
On April 17, 2013, the Company and PGGM Private Real Estate Fund formed IAGM Retail Fund I, LLC ("IAGM"), a joint
venture partnership in which the Company owned a 55% interest, for the purpose of acquiring, owning, managing, and
disposing of retail properties and sharing in the profits and losses from those retail properties and their activities.
On January 18, 2023, the Company acquired the four remaining retail properties from IAGM, for an aggregate purchase price
of $222.3 million, by acquiring 100% of the membership interests in each of IAGM's wholly owned subsidiaries. The Company
assumed aggregate mortgage debt of $92.5 million and funded the remaining balance with its available liquidity. IAGM
recognized a gain on sale of $45.2 million, of which the Company's share was approximately $24.9 million. The Company's
aggregate deferred gains related to its previously owned equity interest in real estate acquisitions from IAGM of $39.9 million
are reflected in the basis of the respective acquired assets. Subsequent to the transaction, IAGM proportionately distributed
substantially all net proceeds from the sale, of which the Company's share was approximately $71.4 million. In connection with
the foregoing, IAGM adopted a liquidation plan on January 11, 2023. On December 15, 2023, IAGM was fully liquidated.
On January 18, 2023, the Company acquired IAGM's two interest rate swap agreements which achieved fixed interest rates on
an aggregate notional amount of $75.0 million of the assumed pooled mortgage priced in a Secured Overnight Financing Rate
("SOFR"), each of which repriced monthly ("1-Month Term SOFR"). IAGM recognized a gain on sale of $2.6 million
representing the fair value of the derivatives, of which the Company's share was approximately $1.4 million. The Company
deferred its share of IAGM's gain on sale of derivatives, initially reflecting it within accumulated comprehensive income and
amortized it to interest expense, net, through the instruments' maturity date of November 2, 2023.
F-18
7. Intangible Assets, Liabilities, and Deferred Leasing Costs
The following table summarizes the Company's intangible assets, intangible liabilities, and deferred leasing costs:
As of December 31
2024
2023
Intangible assets:
In-place leases
$
216,175
$
183,139
Above-market leases
16,053
17,967
Intangible assets
232,228
201,106
Accumulated amortization:
In-place leases
(87,104)
(78,177)
Above-market leases
(7,704)
(8,444)
Accumulated amortization
(94,808)
(86,621)
Intangible assets, net
$
137,420
$
114,485
Intangible liabilities:
Below-market leases
$
65,776
$
52,412
Accumulated amortization
(22,879)
(22,068)
Intangible liabilities, net
$
42,897
$
30,344
Deferred leasing costs:
Leasing costs
$
25,132
$
22,621
Accumulated amortization
(8,993)
(7,626)
Deferred leasing costs, net
$
16,139
$
14,995
The following table summarizes the amortization related to intangible assets, intangible liabilities, and deferred leasing costs:
Year ended December 31
2024
2023
2022
Intangible assets:
In-place leases
$
28,133
$
32,179
$
20,993
Above-market leases
2,452
2,977
2,018
Amortization of intangible assets
$
30,585
$
35,156
$
23,011
Intangible liabilities:
Amortization of below-market leases
$
4,879
$
5,976
$
7,403
Deferred leasing costs:
Amortization of deferred leasing costs
$
3,213
$
2,691
$
2,533
The following table summarizes the amortization during the next five years and thereafter related to intangible assets, intangible
liabilities, and deferred leasing costs as of December 31, 2024:
Year ending December 31,
In-place leases
Above market leases
Below market leases
Deferred leasing costs
2025
$
29,159
$
2,143
$
5,196
$
2,630
2026
23,450
1,719
4,649
2,463
2027
17,375
1,273
3,722
2,203
2028
13,323
967
3,205
1,910
2029
9,426
616
2,894
1,631
Thereafter
36,338
1,631
23,231
5,302
Total
$
129,071
$
8,349
$
42,897
$
16,139
F-19
8. Debt
The Company's debt consists of mortgages payable, unsecured term loans, senior notes, and an unsecured revolving line of
credit. The Company believes it has the ability to repay, refinance or extend any of its debt, and that it has adequate sources of
funds to meet short-term cash needs. It is anticipated that the Company will use proceeds from property sales, cash on hand, and
available capacity on credit agreements, if any, to repay, refinance or extend the mortgages payable maturing in the near term.
The Company's credit agreements and mortgage loans require compliance with certain covenants, such as debt service coverage
ratios, investment restrictions and distribution limitations. As of December 31, 2024 and 2023, the Company was in compliance
with all loan covenants.
On February 6, 2023, the Company extinguished the $13.7 million mortgage payable secured by Renaissance Center with its
available liquidity.
On October 17, 2023, the Company extended the maturity of its $92.5 million cross-collateralized mortgage debt maturing in
2023 by exercising one of its two 12-month extension options. On December 22, 2023, the Company partially paid down the
mortgage debt by $20.0 million, resulting in the release of Blackhawk Town Center from collateralization.
On June 5, 2024, the Company extinguished the $7.3 million and $8.4 million pooled mortgages payable secured by Plantation
Grove and Suncrest Village, respectively, with its available liquidity.
On September 27, 2024, the Company extinguished the remaining $72.5 million pooled mortgage payable secured by Cyfair
Town Center, Bay Colony, and Stables Town Center with its available liquidity.
Credit Agreements
On September 22, 2021, the Company entered into an amendment to the Revolving Credit Agreement (the "Amended
Revolving Credit Agreement"), which provides for, among other things, an extension of the maturity of the $350.0 million
Revolving Credit Agreement to September 22, 2025, with two six-month extension options. On October 23, 2024, the Company
entered into a third amendment to the Amended Revolving Credit Agreement, which provides for, among other things, an
increase in the revolving commitments thereunder from $350.0 million to $500.0 million and an extension of the maturity date
to January 15, 2029, with one 6-month extension option.
On September 22, 2021, the Company entered into an amendment to its $400.0 million Term Loan Credit Agreement (the
"Amended Term Loan Agreement"), which provides for, among other things, an extension of the maturity dates and a
reallocation of indebtedness under the two outstanding tranches of term loans thereunder. The Amended Term Loan Agreement
consists of a $200.0 million 5-year tranche maturing on September 22, 2026, and a $200.0 million 5.5-year tranche maturing on
March 22, 2027.
On May 11, 2022, the Company transitioned its Amended Revolving Credit Agreement and Amended Term Loan Agreement
from 1-Month LIBOR to 1-Month Term SOFR.
On June 3, 2022, in connection with and upon effectiveness of the Note Purchase Agreement (as defined below) and in
accordance with the terms of the Amended Term Loan Credit Agreement and Amended Revolving Credit Agreement, each of
the administrative agents under such agreements released all of the subsidiary guarantors from their guaranty obligations that
were previously made for the benefit of the lenders under such agreements.
Senior Notes
On August 11, 2022, the Company issued $250.0 million aggregate principal amount of senior notes in a private placement, of
which (i) $150.0 million are designated as 5.07% Senior Notes, Series A, due August 11, 2029 (the "Series A Notes") and (ii)
$100.0 million are designated as 5.20% Senior Notes, Series B, due August 11, 2032 (the "Series B Notes" and, together with
the Series A Notes, the "Notes") pursuant to a note purchase agreement (the "Note Purchase Agreement"), dated June 3, 2022,
between the Company and the various purchasers named therein. The Notes were issued at par in accordance with the Note
Purchase Agreement and pay interest semiannually on February 11th and August 11th until their respective maturities.
The Company may prepay at any time all or any part of the Notes, in an amount not less than 5% of the aggregate principal
amount of any series of the Notes then outstanding in the case of a partial prepayment, at 100% of the principal amount prepaid
plus accrued interest and a Make-Whole Amount (as defined in the Note Purchase Agreement). The Notes will be required to
be absolutely and unconditionally guaranteed by certain subsidiaries of the Company that guarantee certain material credit
facilities of the Company. Currently, there are no subsidiary guarantees of the Notes.
F-20
The following table summarizes the Company's debt as of December 31, 2024 and 2023:
Interest
Rate Type
As of December 31, 2024
As of December 31, 2023
Maturity Date
Interest Rate
Amount
Interest Rate
Amount
Mortgages Payable
Fixed rate mortgages payable
Various
Fixed
3.97% (a)
$
93,380
4.01% (a)
$
96,080
Variable rate mortgages payable (b)
N/A
Variable
N/A
—
1M SOFR+
1.65% (c)
72,468
Total
93,380
168,548
Term Loans
$200.0 million 5 year
9/22/26
Fixed
2.81% (d)
100,000
2.81% (d)
100,000
$200.0 million 5 year
9/22/26
Fixed
2.81% (d)
100,000
2.81% (d)
100,000
$200.0 million 5.5 year
3/22/27
Fixed
2.78% (d)
50,000
2.77% (d)
50,000
$200.0 million 5.5 year
3/22/27
Fixed
2.84% (d)
50,000
2.76% (d)
50,000
$200.0 million 5.5 year
3/22/27
Fixed
4.99% (d)
100,000
4.99% (d)
100,000
Total
400,000
400,000
Senior Notes
$150.0 million Series A Notes
8/11/29
Fixed
5.07%
150,000
5.07%
150,000
$100.0 million Series B Notes
8/11/32
Fixed
5.20%
100,000
5.20%
100,000
Total
250,000
250,000
Revolving Line of Credit
$500.0 million total capacity (e)
1/15/29
Variable
1M SOFR +
1.15% (c)(f)
—
1M SOFR +
1.14% (c)(f)
—
Total debt
4.03%
743,380
4.29%
818,548
Debt discounts and financing costs, net
(2,965)
(3,980)
Debt, net
$
740,415
$
814,568
(a)
Interest rates reflect the weighted average of the Company's mortgages payable.
(b)
These mortgages payable were cross-collateralized by three properties and were extinguished on September 27, 2024.
(c)
As of December 31, 2024 and 2023, 1-Month Term SOFR was 4.33% and 5.35%, respectively.
(d)
Interest rates reflect the fixed rates achieved through the Company's interest rate swaps.
(e)
Prior to the third amendment, the total capacity on the Revolving Line of Credit was $350.0 million.
(f)
Interest rate applies to drawn balance only. Additional annual facility fee of 0.15% applies to entire line of credit capacity.
The following table summarizes the scheduled maturities of the Company's mortgages payable as of December 31, 2024:
Scheduled maturities by year:
Principal Balance
2025
$
35,880
2026
—
2027
26,000
2028
—
2029
31,500
Thereafter
—
Total
$
93,380
F-21
Interest Rate Swaps
As of December 31, 2024, the Company is party to five effective interest rate swap agreements which achieve fixed interest
rates through the maturity dates of the Amended Term Loan Agreement.
The following table summarizes the Company's five effective interest rate swaps as of December 31, 2024:
Interest Rate Swaps
Effective
Date
Termination
Date
InvenTrust Receives
InvenTrust Pays
Fixed Rate of
Fixed Rate
Achieved
Notional
Amount
5.5 Year Term Loan
4/3/23
3/22/27
1-Month SOFR
3.69%
4.99%
$
100,000
5 Year Term Loan
12/21/23
9/22/26
1-Month SOFR
1.51%
2.81%
100,000
5 Year Term Loan
12/21/23
9/22/26
1-Month SOFR
1.51%
2.81%
100,000
5.5 Year Term Loan
6/21/24
3/22/27
1-Month SOFR
1.54%
2.84%
50,000
5.5 Year Term Loan
6/21/24
3/22/27
1-Month SOFR
1.48%
2.78%
50,000
$
400,000
The following table summarizes the Company's five effective and two forward interest rate swaps as of December 31, 2023:
Interest Rate Swaps
Effective
Date
Termination
Date
InvenTrust Receives
InvenTrust Pays
Fixed Rate of
Fixed Rate
Achieved
Notional
Amount
5.5 Year Term Loan
12/2/19
6/21/24
1-Month SOFR
1.47%
2.77%
$
50,000
5.5 Year Term Loan
12/2/19
6/21/24
1-Month SOFR
1.46%
2.76%
50,000
5.5 Year Term Loan
4/3/23
3/22/27
1-Month SOFR
3.69%
4.99%
100,000
5 Year Term Loan
12/21/23
9/22/26
1-Month SOFR
1.51%
2.81%
100,000
5 Year Term Loan
12/21/23
9/22/26
1-Month SOFR
1.51%
2.81%
100,000
$
400,000
5.5 Year Term Loan
6/21/24
3/22/27
1-Month SOFR
1.48%
2.78%
$
50,000
5.5 Year Term Loan
6/21/24
3/22/27
1-Month SOFR
1.54%
2.84%
50,000
$
100,000
The following table summarizes the effects of derivative financial instruments on the consolidated financial statements for the
years ended December 31, 2024, 2023 and 2022:
Location and amount of gain
recognized in accumulated
comprehensive income
Location and amount of gain (loss)
reclassified from accumulated
comprehensive income into net income (loss)
Total interest expense presented in the
consolidated statements of operations in which
the effects of cash flow hedges are recorded
2024
2023
2022
2024
2023
2022
2024
2023
2022
Unrealized
gain on
derivatives
$
9,019
$
6,228
$ 32,052
Interest
expense,
net
$ 12,667
$ 14,875
$
1,009
Interest
expense,
net
$ 37,100
$ 38,138
$ 26,777
F-22
9. Fair Value Measurements
Recurring Measurements
The following financial instruments are remeasured at fair value on a recurring basis:
Fair Value Measurements as of
December 31, 2024
December 31, 2023
Cash Flow Hedges: (a) (b)
Level 1
Level 2 (c)
Level 3
Level 1
Level 2 (c)
Level 3
Derivative interest rate swaps
—
$
14,426
—
—
$
18,074
—
(a)
During the twelve months subsequent to December 31, 2024, an estimated $8,083 of derivative interest rate balances recognized in
accumulated comprehensive income will be reclassified into earnings.
(b)
As of December 31, 2024 and 2023, the Company determined that the credit valuation adjustments associated with nonperformance risk are
not significant to the overall valuation of its derivatives. As a result, the Company's derivative valuations in their entirety are classified as
Level 2 of the fair value hierarchy.
(c)
Derivative assets or liabilities are recognized as a part of deferred costs and other assets, net or other liabilities, respectively.
Level 1
At December 31, 2024 and 2023, the Company had no Level 1 recurring fair value measurements.
Level 2
To calculate the fair value of the derivative interest rate instruments, the Company primarily uses quoted prices for similar
contracts and inputs based on data that are observed in the forward yield curve that is widely observable in the marketplace. The
Company also incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the
respective counterparty’s nonperformance risk in the fair value measurements that utilize Level 3 inputs, such as estimates of
current credit spreads.
Level 3
At December 31, 2024 and 2023, the Company had no Level 3 recurring fair value measurements.
Non-Recurring Measurements
Investment Properties
During the year ended December 31, 2024, the Company recorded an impairment of real estate assets of $3,854 on one retail
property after receiving and accepting a letter of intent to purchase the property for less than its carrying value. The estimated
fair value of the property was based on this negotiated letter of intent. The property was sold on October 31, 2024 for $57,800,
resulting in a loss on sale of $614, which was primarily closing costs.
During the years ended December 31, 2023 and 2022, the Company had no Level 3 nonrecurring fair value measurements.
Financial Instruments Not Measured at Fair Value
The following table summarizes the estimated fair value of financial instruments presented at carrying values in the Company's
consolidated financial statements as of December 31, 2024 and 2023:
December 31, 2024
December 31, 2023
Carrying Value
Estimated
Fair Value
Market
Interest Rate
Carrying Value
Estimated
Fair Value
Market
Interest Rate
Mortgages payable
$
93,380
$
87,576
6.64 %
$
168,548
$
161,320
6.86 %
Senior notes
250,000
236,480
6.23 %
250,000
233,635
6.31 %
Term loans
400,000
400,170
5.29 %
400,000
399,539
5.10 %
Revolving line of credit
—
—
N/A
—
—
N/A
The market interest rates used to estimate the fair value of the Company's mortgages payable, senior notes, term loans, and
revolving line of credit reflect the terms currently available on similar borrowing terms to borrowers with credit profiles similar
to that of the Company's. The Company classifies its debt instrument valuations within Level 2 of the fair value hierarchy.
F-23
10. Earnings Per Share and Equity Transactions
Basic earnings per share ("EPS") is computed by dividing net income or loss attributed to common shares by the weighted
average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that may occur from
awards issued pursuant to stock-based compensation plans.
The following table reconciles the amounts used in calculating basic and diluted EPS:
Year ended December 31
2024
2023
2022
Numerator:
Net income attributed to common shares - basic and diluted
$
13,658
$
5,269
$
52,233
Denominator:
Weighted average common shares outstanding - basic
70,394,448
67,531,898
67,406,233
Dilutive effect of unvested restricted shares
616,120
281,282
119,702
Weighted average common shares outstanding - diluted
71,010,568
67,813,180
67,525,935
Basic and diluted earnings per common share:
Net income per common share - basic
$
0.19
$
0.08
$
0.77
Net income per common share - diluted
$
0.19
$
0.08
$
0.77
ATM Program
On March 7, 2022, the Company established an at-the-market equity offering program (the "ATM Program") through which the
Company may sell from time to time up to an aggregate of $250.0 million of its common stock. In connection with the ATM
Program, the Company may sell shares of its common stock to or through sales agents, or may enter into separate forward sale
agreements with one of the agents, or one of their respective affiliates, as a forward purchaser. As of December 31, 2024,
$236.7 million of common stock remains available for issuance under the ATM Program.
The following table summarizes the Company's activity under the ATM Program:
Number of
Shares Issued
Weighted
Average Price
Gross Proceeds
Commissions
Net Proceeds
Quarter ended December 31, 2023
208,040
$26.13
$
5,437
$
68
$
5,369
Quarter ended December 31, 2024
254,082
$30.96
$
7,866
$
99
$
7,767
Share Repurchase Programs
On February 23, 2022, the Company established a share repurchase program (the "SRP") of up to $150.0 million of the
Company's outstanding shares of common stock. The SRP may be suspended or discontinued at any time, and does not obligate
the Company to repurchase any dollar amount or particular amount of shares. As of December 31, 2024, the Company has not
repurchased any common stock under the SRP.
Common Stock Offering
On September 25, 2024, the Company completed an underwritten public offering of its common stock at a price to the public of
$28.00 per share. The Company issued and sold 9,200,000 shares of its common stock, including 1,200,000 shares issued in
connection with the full exercise of the underwriters' over-allotment option. The Company received $247.3 million of net
proceeds, after deducting $10.3 million in underwriting discounts and commissions.
F-24
11. Stock-Based Compensation
Incentive Award Plan
The Company's Board adopted the InvenTrust Properties Corp. 2015 Incentive Award Plan effective as of June 19, 2015 (the
"Incentive Award Plan"). On May 6, 2016, the Board adopted the first amendment to the Incentive Award Plan and on March
20, 2024, the Board adopted the second amendment to the Incentive Award Plan (collectively, the "Amendments"). The
Company's stockholders approved the Incentive Award Plan, as amended by the Amendments, on May 7, 2024, which, among
other things, increased the aggregate number of shares of common stock that may be issued pursuant to awards granted under
the Incentive Award Plan (the "Share Limit") by 2,750,000 shares to 5,750,000 shares. Any forfeited awards or unearned
performance shares subject to an award are added back to the Share Limit.
As of December 31, 2024, outstanding restricted stock unit ("RSU") awards are categorized as either time-based awards or
market-based awards. All awards are granted at fair value, earn dividends throughout the vesting period, and have no voting
rights. As of December 31, 2024, 2,854,824 shares were available for future issuance under the Incentive Award Plan.
Market-based awards are valued as of the grant date utilizing a Monte Carlo simulation model that assesses the probability of
satisfying certain market performance thresholds over a three year performance period.
The following table summarizes the Company's significant assumptions used in the Monte Carlo simulation models:
At Grant Date
2024
2023
2022
Volatility
31.00%
34.00%
33.89%
Risk free interest rate
4.42%
4.45%
0.79 % - 1.76%
Dividend Yield
3.40%
3.20%
3.24%
The following table summarizes the Company's RSU activity under the Incentive Award Plan:
Unvested Time-
Based RSUs
Unvested Performance
and Market-Based RSUs
Weighted Average Grant
Date Price Per Share
Outstanding as of January 1, 2022
138,235
471,368
$30.12
Shares granted
127,862
396,338
$18.97
Shares vested
(135,491)
(76,520)
$29.36
Unearned performance shares
—
(61,102)
$31.40
Shares forfeited
(7,179)
(18,033)
$23.42
Outstanding as of December 31, 2022
123,427
712,051
$23.35
Shares granted
152,393
445,828
$18.40
Shares vested
(126,885)
(60,042)
$29.50
Unearned performance shares
—
(69,803)
$31.40
Shares forfeited
(1,343)
(3,263)
$19.51
Outstanding as of December 31, 2023
147,592
1,024,771
$19.36
Shares granted
197,884
335,936
$19.78
Shares vested
(155,511)
(113,954)
$26.33
Unearned performance shares
—
(82,665)
$28.90
Shares forfeited
(2,190)
(17,360)
$17.41
Outstanding as of December 31, 2024
187,775
1,146,728
$17.71
F-25
Employee Stock Purchase Plan
Employees may purchase up to an aggregate of 3,300,000 shares of the Company's common stock under the ESPP, of which
3,274,365 shares remain available as of December 31, 2024.
The following table summarizes the Company's activity under the ESPP:
Year ended December 31
2024
2023
Shares purchased
13,907
11,728
Discounted issuance price
$20.14
$20.07
Issuance proceeds
$280
$235
Stock-Based Compensation Expense
The following table summarizes the Company's stock-based compensation expense:
Year ended December 31
2024
2023
2022
Incentive Award Plan, net (a)
$
9,759
$
8,953
$
6,541
Employee Stock Purchase Plan (b)
137
68
—
Stock-based compensation expense, net
$
9,896
$
9,021
$
6,541
(a)
As of December 31, 2024, there was $10,225 of total estimated unrecognized compensation expense related to the Incentive Award Plan
which will be recognized through December 2027.
(b)
As of December 31, 2024, there was $76 of total estimated unrecognized compensation expense related to the ESPP which will be
recognized through June 2026.
12. Segment Information
Single Reportable Segment
The Company's Chief Executive Officer (the "CEO") evaluates the performance of the Company's portfolio of retail properties
and determines how resources are allocated. Accordingly, the CEO has been deemed the chief operating decision maker (the
"CODM"). The Company generates substantially all of its earnings from multi-tenant essential retail properties located in the
Sun Belt, and the CODM regularly evaluates the performance of the Company and its retail portfolio on a consolidated basis.
The CODM does not distinguish the Company's principal business, or group its operations by geography or size for the
purposes of measuring performance. As the CODM reviews, analyzes, makes decisions, and allocates resources on a
consolidated basis, the Company has determined it has a single operating and reportable segment, its portfolio of multi-tenant
retail properties.
Segment Performance
The CODM believes net income or loss determined in accordance with GAAP is the most appropriate earnings measurement to
assess the Company's overall performance. Additionally, the CODM evaluates the consolidated performance of the Company's
portfolio of retail properties based on Net Operating Income ("NOI"), a supplemental non-GAAP measure. NOI excludes
general and administrative expenses, depreciation and amortization, other income and expense, net, gains (losses) from sales of
properties, gains (losses) on extinguishment of debt, impairment of real estate assets, interest expense, net, equity in (losses)
earnings of unconsolidated entities, lease termination income and expense, and GAAP rent adjustments such as amortization of
market lease intangibles, amortization of lease incentives, and straight-line rent adjustments ("GAAP Rent Adjustments").
The CODM believes the supplemental non-GAAP measure of NOI is an important measure in assessing operating performance
and provides added comparability across periods when evaluating the Company's financial condition and operating performance
that is not readily apparent from "Net income" in accordance with GAAP.
Operating retail properties generally require capital investments, including value-enhancing development and redevelopment
projects and leasing commissions. During the years ended December 31, 2024 and 2023, the Company spent $36,116 and
$35,744 on capital investments and leasing costs, respectively. As of December 31, 2024 and 2023, total accrued capital
investments and leasing costs were $3,620 and $2,562, respectively.
The measure of segment assets regularly reviewed by the CODM is reported on the consolidated balance sheets as Total assets.
No single tenant comprises 10% or more of the Company's Lease income, net for any years presented.
F-26
Net Operating Income
The following table reconciles net income, the most directly comparable GAAP measure, to NOI:
Net income
$
13,658
$
5,269
$
52,233
Adjustments to reconcile to NOI:
Other income and expense, net
(3,755)
(5,480)
(2,030)
Equity in losses (earnings) of unconsolidated entities
—
557
(3,663)
Interest expense, net
37,100
38,138
26,777
Loss on extinguishment of debt
—
15
181
Gain on sale of investment properties, net
(3,857)
(2,691)
(38,249)
Impairment of real estate assets
3,854
—
—
Depreciation and amortization
113,948
113,430
94,952
General and administrative
33,172
31,797
33,342
Other fee income
—
(80)
(2,566)
Adjustments to NOI (a)
(7,548)
(7,528)
(9,743)
NOI
$
186,572
$
173,427
$
151,234
Year Ended December 31
2024
2023
2022
(a)
Adjustments to NOI include lease termination income and expense and GAAP Rent Adjustments.
Significant Expenses
The following table reflects the disaggregation of property operating expenses:
Repairs and maintenance
$
13,366
$
14,270
$
15,120
Payroll, benefits, and office
10,510
10,690
8,336
Utilities and waste removal
9,462
8,747
7,760
Property insurance
6,668
5,552
4,168
Security, legal, and other expenses
3,387
3,573
4,855
Lease termination expense
20
—
—
Property operating expenses
$
43,413
$
42,832
$
40,239
Year ended December 31
2024
2023
2022
13. Commitments and Contingencies
Legal Matters
The Company is subject, from time to time, to various types of third-party legal claims or litigation that arise in the ordinary
course of business, including, but not limited to, property loss claims, personal injury or other damages resulting from contact
with the Company's properties. These claims and lawsuits and any resulting damages are generally covered by the Company's
insurance policies. The Company accrues for legal costs associated with loss contingencies when these costs are probable and
reasonably estimable. While the resolution of these matters cannot be predicted with certainty, based on currently available
information, management does not expect that the final outcome of any pending claims or legal proceedings will have a
material adverse effect on the financial condition, results of operations or cash flows of the Company.
Captive Insurance Company
In April 2023, the Company formed a wholly-owned captive insurance company (the "Captive") which provides insurance
coverage for all losses below the deductibles of the Company’s third party liability insurance policies relating to wind, flood,
named windstorm, earthquake, fire, and other property-related perils. The Company formed the Captive as part of its overall
risk management program and to stabilize insurance costs, manage exposures, and recoup expenses through the function of the
captive program. The Captive is capitalized in accordance with the applicable regulatory requirements.
During the year ended December 31, 2023, the Captive incurred no claims. During the year ended December 31, 2024, the
Captive incurred estimated claims of $881, of which $61 has been paid.
F-27
Operating Lease Commitments
The Company is the lessee under various operating leases for corporate office space for which the Company recognizes right-
of-use ("ROU") assets and related lease liabilities.
The following table summarizes the Company's operating lease arrangements:
Balance Sheet Caption
December 31, 2024
December 31, 2023
Operating lease ROU assets
Deferred costs and other assets, net
$
3,012
$
3,220
Operating lease ROU accumulated amortization
Deferred costs and other assets, net
$
(1,163)
$
(967)
Operating lease liabilities
Other liabilities
$
2,528
$
3,023
Weighted-average remaining lease term
5.2 years
6.0 years
Weighted-average discount rate
4.49 %
4.47 %
As of
The following table summarizes the Company's operating lease arrangements:
Statement of Operations and
Comprehensive Income (Loss) Caption
Year ended December 31
2024
2023
Minimum lease payments
General and administrative
$
559
$
570
Variable lease payments
General and administrative
300
298
Short-term lease payments
General and administrative
200
114
Total lease cost
$
1,059
$
982
The following table summarizes the Company's future minimum operating lease obligations as of December 31, 2024:
Scheduled minimum payments by year:
Future Minimum Lease Payments
2025
$
511
2026
517
2027
529
2028
522
2029
493
Thereafter
293
Total expected minimum lease obligation
2,865
Less: Amount representing interest (a)
(337)
Present value of net minimum lease payments
$
2,528
(a)
Interest includes the amount necessary to reduce the total expected minimum lease obligations to present value calculated at the Company's
incremental borrowing rate.
14. Subsequent Events
In preparing its consolidated financial statements, the Company evaluated events and transactions occurring after December 31,
2024 through the date the financial statements were issued for recognition and disclosure purposes.
F-28
Antoine Town Center
Houston, TX
$
—
$
5,327
$
14,333
$
—
$
(528) $
5,327
$
13,805
$
19,132
$
3,157
2020
Bay Colony
Houston, TX
—
8,287
41,714
—
2,424
8,287
44,138
52,425
3,899
2023
Bay Landing
Bonita Springs, FL
—
1,687
9,283
—
112
1,687
9,395
11,082
1,072
2022
Bear Creek Village Center
Wildomar, CA
—
3,523
12,384
—
(799)
3,523
11,585
15,108
5,922
2009
Bent Tree Plaza
Raleigh, NC
—
1,983
7,093
—
807
1,983
7,900
9,883
3,910
2009
Blackhawk Town Center
Houston, TX
—
10,265
6,156
—
(40)
10,265
6,116
16,381
842
2023
Buckhead Crossing
Atlanta, GA
—
7,565
27,104
—
949
7,565
28,053
35,618
13,558
2009
Campus Marketplace
San Marcos, CA
—
26,928
43,445
55
1,239
26,983
44,684
71,667
12,612
2017
Cary Park Town Center
Cary, NC
—
5,555
17,280
—
110
5,555
17,390
22,945
4,743
2017
Commons at University
Place
Durham, NC
—
3,198
17,909
—
(8)
3,198
17,901
21,099
3,648
2019
Coweta Crossing
Newnan, GA
—
1,143
4,590
—
(417)
1,143
4,173
5,316
2,352
2009
Custer Creek Village
Richardson, TX
—
4,750
12,245
—
1,433
4,750
13,678
18,428
7,349
2007
Cyfair Town Center
Houston, TX
—
16,184
48,566
—
828
16,184
49,394
65,578
4,339
2023
Eastfield Village
Charlotte, NC
—
2,327
14,321
—
337
2,327
14,658
16,985
1,444
2022
Eldorado Marketplace
Frisco, TX
—
15,732
49,311
—
801
15,732
50,112
65,844
9,441
2019
Eldridge Town Center
Houston, TX
—
3,200
16,687
1,761
5,867
4,961
22,554
27,515
10,606
2005
Escarpment Village
Austin, TX
26,000
19,641
51,763
—
291
19,641
52,054
71,695
6,001
2022
Garden Village
San Pedro, CA
—
3,188
16,522
3,268
609
6,456
17,131
23,587
8,453
2009
Gateway Market Center
St. Petersburg, FL
—
13,600
4,992
—
4,983
13,600
9,975
23,575
3,946
2010
Kennesaw Marketplace
Kennesaw, GA
—
12,587
51,860
—
453
12,587
52,313
64,900
12,083
2018
Kyle Marketplace
Kyle, TX
—
6,076
48,220
711
681
6,787
48,901
55,688
12,358
2017
Initial Cost (A)
Gross amount at which carried at end of period
PROPERTY NAME
Location
Encumbrance
Land
Buildings and
Improvements
Adjustments to
Land Basis (B)
Adjustments to
Basis (B)
Land
Buildings and
Improvements
Total (C)
Accumulated
Depreciation
(D,E)
Year
Acquired
INVENTRUST PROPERTIES CORP.
Schedule III - Real Estate and Accumulated Depreciation
(amounts stated in thousands)
F-29
Lakeside & Lakeside
Crossing
Winter Park, FL
$
—
$
16,594
$
41,085
$
—
$
(112) $
16,594
$
40,973
$
57,567
$
8,489
2019
Market at Mill Creek
Mount Pleasant, SC
—
2,435
20,324
—
12
2,435
20,336
22,771
—
2024
Market at Westlake
Westlake Hills, TX
—
1,200
6,274
(64)
(42)
1,136
6,232
7,368
3,605
2007
Moores Mill
Atlanta, GA
—
5,180
17,653
—
10
5,180
17,663
22,843
495
2024
Nexton Square
Summerville, SC
—
9,531
41,546
—
21
9,531
41,567
51,098
—
2024
Northcross Commons
Charlotte, NC
—
7,591
21,303
—
905
7,591
22,208
29,799
6,415
2016
Old Grove Marketplace
Oceanside, CA
—
12,545
8,902
—
472
12,545
9,374
21,919
2,967
2016
Pavilion at La Quinta
La Quinta, CA
—
15,200
20,947
—
1,217
15,200
22,164
37,364
11,123
2009
Peachland Promenade
Port Charlotte, FL
—
1,742
6,502
4,158
10,674
5,900
17,176
23,076
4,183
2009
PGA Plaza Palm Beach
Gardens
Palm Beach Gardens, FL
—
10,414
75,730
—
1,293
10,414
77,023
87,437
17,072
2018
Plantation Grove &
Maguire Grove
Ocoee, FL
—
5,791
19,037
—
1,058
5,791
20,095
25,886
3,126
2014 &
2024
Plaza Midtown
Atlanta, GA
—
5,295
23,946
—
1,219
5,295
25,165
30,460
6,010
2017
Prestonwood Town Center
Dallas, TX
—
22,055
22,140
—
538
22,055
22,678
44,733
3,540
2021
Renaissance Center
Durham, NC
—
26,713
96,141
—
6,530
26,713
102,671
129,384
32,996
2016
Rio Pinar Plaza
Orlando, FL
—
5,171
26,903
676
1,991
5,847
28,894
34,741
9,109
2015
River Oaks
Santa Clarita, CA
—
24,598
88,418
—
3,228
24,598
91,646
116,244
22,416
2017
Riverview Village
Arlington, TX
—
6,000
9,649
—
448
6,000
10,097
16,097
5,939
2007
Riverwalk Market
Flower Mound, TX
—
5,931
23,922
—
366
5,931
24,288
30,219
7,228
2016
Rose Creek
Woodstock, GA
—
1,443
5,630
—
117
1,443
5,747
7,190
2,831
2009
Sandy Plains Centre
Marietta, GA
—
12,364
27,270
652
4,600
13,016
31,870
44,886
6,151
2018
Initial Cost (A)
Gross amount at which carried at end of period
PROPERTY NAME
Location
Encumbrance
Land
Buildings and
Improvements
Adjustments to
Land Basis (B)
Adjustments to
Basis (B)
Land
Buildings and
Improvements
Total (C)
Accumulated
Depreciation
(D,E)
Year
Acquired
INVENTRUST PROPERTIES CORP.
Schedule III - Real Estate and Accumulated Depreciation
(amounts stated in thousands)
F-30
Sarasota Pavilion
Sarasota, FL
$
—
$
12,000
$
25,823
$
—
$
12,532
$
12,000
$
38,355
$
50,355
$
15,101
2010
Scofield Crossing
Austin, TX
—
8,100
4,992
(576)
2,923
7,524
7,915
15,439
3,453
2007
Scottsdale North
Marketplace
Scottsdale, AZ
—
6,505
14,683
—
124
6,505
14,807
21,312
310
2024
Shops at Arbor Trails
Austin, TX
31,500
28,233
76,769
—
169
28,233
76,938
105,171
9,112
2022
Shops at Fairview Town
Center
Fairview, TX
—
7,299
25,233
—
1,188
7,299
26,421
33,720
5,053
2019
Shops at the Galleria
Bee Cave, TX
—
52,104
75,651
(597)
4,437
51,507
80,088
131,595
24,981
2016
Sonterra Village
San Antonio, TX
—
5,150
15,095
(181)
803
4,969
15,898
20,867
5,012
2015
Southern Palm Crossing
Royal Palm Beach, FL
—
37,735
49,843
(745)
2,716
36,990
52,559
89,549
11,011
2019
Stables Town Center
Houston, TX
—
5,899
20,439
—
73
5,899
20,512
26,411
1,844
2023
Stonehenge Village
Midlothian, VA
—
10,534
44,971
—
14
10,534
44,985
55,519
568
2024
Stone Ridge Market
San Antonio, TX
—
8,935
38,754
—
(5,427)
8,935
33,327
42,262
2,995
2022
Suncrest Village
Orlando, FL
—
6,742
6,403
—
11,338
6,742
17,741
24,483
3,128
2014
Sycamore Commons
Matthews, NC
—
12,500
31,265
—
2,367
12,500
33,632
46,132
18,059
2010
The Centre on Hugh
Howell
Tucker, GA
—
2,250
11,091
—
1,899
2,250
12,990
15,240
6,558
2007
The Forum
Fort Myers, FL
—
9,939
21,943
—
58
9,939
22,001
31,940
87
2024
The Highlands of Flower
Mound
Flower Mound, TX
22,880
6,330
24,374
—
(160)
6,330
24,214
30,544
2,967
2022
The Parke
Cedar Park, TX
—
9,271
83,078
—
1,550
9,271
84,628
93,899
22,432
2017
The Plant
Chandler, AZ
13,000
3,864
21,423
—
8
3,864
21,431
25,295
812
2024
The Pointe at Creedmoor
Raleigh, NC
—
7,507
5,454
—
82
7,507
5,536
13,043
1,896
2016
The Shoppes at Davis Lake
Charlotte, NC
—
6,232
12,903
—
61
6,232
12,964
19,196
864
2023
Initial Cost (A)
Gross amount at which carried at end of period
PROPERTY NAME
Location
Encumbrance
Land
Buildings and
Improvements
Adjustments to
Land Basis (B)
Adjustments to
Basis (B)
Land
Buildings and
Improvements
Total (C)
Accumulated
Depreciation
(D,E)
Year
Acquired
INVENTRUST PROPERTIES CORP.
Schedule III - Real Estate and Accumulated Depreciation
(amounts stated in thousands)
F-31
The Shops at Town Center
Germantown, MD
$
—
$
19,998
$
29,776
$
—
$
1,160
$
19,998
$
30,936
$
50,934
$
8,691
2017
Thomas Crossroads
Newnan, GA
—
1,622
8,322
—
1,028
1,622
9,350
10,972
4,500
2009
Travilah Square
Rockville, MD
—
8,964
39,836
—
729
8,964
40,565
49,529
7,302
2019
University Oaks Shopping
Center
Round Rock, TX
—
7,250
25,326
(170)
8,748
7,080
34,074
41,154
18,291
2010
Westfork Plaza & Paraiso
Parc
Pembroke Pines, FL
—
28,267
124,019
—
7,533
28,267
131,552
159,819
36,026
2017
Westpark Shopping Center
Glen Allen, VA
—
7,462
24,164
(4)
6,339
7,458
30,503
37,961
9,130
2013
Windward Commons
Alpharetta, GA
—
12,823
13,779
(171)
881
12,652
14,660
27,312
4,750
2016
Total corporate assets
—
—
—
—
3,733
—
3,733
3,733
1,606
-
Total
$
93,380
$
704,054
$
1,994,509
$
8,773
$
121,583
$
712,827
$
2,116,092
$
2,828,919
$
511,969
Construction in progress
—
—
—
9,951
—
9,951
9,951
—
Total investment properties
$
704,054
$
1,994,509
$
8,773
$
131,534
$
712,827
$
2,126,043
$
2,838,870
$
511,969
Initial Cost (A)
Gross amount at which carried at end of period
PROPERTY NAME
Location
Encumbrance
Land
Buildings and
Improvements
Adjustments to
Land Basis (B)
Adjustments to
Basis (B)
Land
Buildings and
Improvements
Total (C)
Accumulated
Depreciation
(D,E)
Year
Acquired
INVENTRUST PROPERTIES CORP.
Schedule III - Real Estate and Accumulated Depreciation
(amounts stated in thousands)
F-32
Notes to Schedule III
The aggregate cost of real estate owned as of December 31, 2024, for federal income tax purposes was approximately $3,227,994 (unaudited).
(A)
The initial cost to the Company represents the original purchase price of the asset, including amounts incurred subsequent to acquisition which were contemplated at the time
the property was acquired.
(B)
Cost capitalized subsequent to acquisition includes additional tangible costs associated with investment properties. Amount also includes impairment charges recorded
subsequent to acquisition to reduce basis.
(C)
Reconciliation of total investment properties:
2024
2023
2022
Balance as of January 1
$
2,656,674
$
2,481,662
$
2,273,103
Acquisitions and capital improvements
277,912
191,666
307,177
Disposals, impairment, and write-offs of assets no longer in service
(95,716)
(16,654)
(98,618)
Balance as of December 31
$
2,838,870
$
2,656,674
$
2,481,662
(D)
Reconciliation of accumulated depreciation:
2024
2023
2022
Balance at January 1,
$
461,352
$
389,361
$
350,256
Depreciation expense
82,603
78,560
71,428
Disposal, impairment, and write-offs of assets no longer in service
(31,986)
(6,569)
(32,323)
Balance at December 31,
$
511,969
$
461,352
$
389,361
(E)
Depreciation is computed based upon the following estimated lives:
Buildings and other improvements
15 - 30 years
Tenant improvements
Life of the lease
Furniture, fixtures and equipment
3 - 20 years
INVENTRUST PROPERTIES CORP.
Schedule III - Real Estate and Accumulated Depreciation
(amounts stated in thousands)
F-33
Exhibit 4.3
DESCRIPTION OF REGISTRANT’S SECURITIES
REGISTERED PURSUANT TO SECTION 12 OF
THE SECURITIES EXCHANGE ACT OF 1934
The following is a brief description of the securities of InvenTrust Properties Corp. (“our
company,” “we,” “us” or “our”) registered pursuant to Section 12 of the Securities Exchange Act
of 1934, as amended (the “Exchange Act”). The following description of our capital stock does
not purport to be complete and is subject to, and qualified in its entirety by, our charter (our
“charter”), and our fourth amended and restated bylaws (our “bylaws”), each of which is
incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit
is a part. We encourage you to read our charter, bylaws and the applicable provisions of the
Maryland General Corporation Law (the “MGCL”) for additional information. Our common
stock, $0.001 par value per share (“Common Stock”), is the only class of our securities registered
under Section 12 of the Exchange Act.
General
Our charter provides that we may issue up to 146,000,000 shares of Common Stock and
up to 40,000,000 shares of preferred stock, $0.001 par value per share (“Preferred Stock”). Our
board of directors (the “Board of Directors” or the “Board”) has the power, with the approval of
a majority of the Board and without stockholder approval, to amend our charter from time to
time to increase or decrease the aggregate number of shares of stock or the number of shares of
stock of any class or series we are authorized to issue.
Under Maryland law, stockholders generally are not personally liable for our debts or
obligations solely as a result of their status as stockholders.
Common Stock
All of the outstanding shares of our Common Stock are duly authorized, fully paid and
nonassessable. Subject to the preferential rights of holders of any other class or series of our
stock, and to the provisions of our charter regarding the restrictions on ownership and transfer of
our stock, our common stockholders are entitled to receive dividends when authorized by our
Board and declared by us out of assets legally available for the payment of dividends and to
share ratably in our assets legally available for distribution to our stockholders in the event of our
liquidation, dissolution or winding up, after payment of, or adequate provision for, all of our
known debts and liabilities.
Subject to our charter restrictions on ownership and transfer of our stock and except as may
otherwise be provided in our charter, each outstanding share of our Common Stock entitles the
holder thereof to one vote on all matters submitted to a vote of stockholders, including the
election of directors. Except as provided with respect to any other class or series of stock, our
common stockholders possess exclusive voting power. Cumulative voting in the election of
directors is not permitted.
Our common stockholders have no preference, conversion, exchange, sinking fund or
redemption rights and have no preemptive rights to subscribe for any of our capital stock.
Subject to our charter restrictions on ownership and transfer of our stock, holders of shares of our
Common Stock have equal dividend, liquidation and other rights. Our charter provides that our
stockholders generally have no appraisal rights.
Under Maryland law, a Maryland corporation generally cannot dissolve, amend its
charter, merge, convert into another entity, sell all or substantially all of its assets, engage in a
statutory share exchange or engage in similar transactions unless declared advisable by the board
of directors and approved by the affirmative vote of stockholders entitled to cast at least two-
thirds of all of the votes entitled to be cast on the matter unless a lesser percentage (but not less
than a majority of the votes entitled to be cast on the matter) is set forth in the corporation’s
charter. Our charter provides for approval of these matters by the affirmative vote of
stockholders entitled to cast a majority of the votes entitled to be cast on such matters.
Our charter authorizes our Board of Directors to reclassify any unissued shares of our
Common Stock into other classes or series of stock, to establish the designation and number of
shares of each such class or series and to set, subject to the provisions of our charter regarding
the restrictions on ownership and transfer of our stock, the preferences, conversion or other
rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications
or terms or conditions of redemption of each such class or series.
Preferred Stock
Under the terms of our charter, our Board of Directors is authorized to classify any
unissued shares of our Preferred Stock and to reclassify any previously classified but unissued
shares of Preferred Stock into other classes or series of stock. Before the issuance of shares of
any class or series, our Board of Directors is required by Maryland law and by our charter to set,
subject to our charter restrictions on ownership and transfer of stock, the terms, preferences,
conversion or other rights, voting powers, restrictions, limitations as to dividends or other
distributions, qualifications or terms or conditions of redemption for such class or series. As of
the date of this filing, we have no outstanding shares of Preferred Stock, and we presently have
no plans to issue any shares of any class or series of Preferred Stock.
Power to Issue Additional Shares of Common Stock and Preferred Stock
We believe that the power to issue additional shares of our Common Stock or Preferred
Stock and to classify or reclassify unissued shares of our Common Stock or Preferred Stock and
to issue the classified or reclassified shares provides us with increased flexibility in structuring
possible future financings and acquisitions and in meeting other needs which might arise. These
actions can be taken without action by our stockholders, unless stockholder approval is required
by the terms of any class or series of our stock, applicable law or the rules of any stock exchange
or automated quotation system on which our stock may be listed or traded. Although we have no
present intention of doing so, we could issue a class or series of stock that (i) has priority over
shares of our Common Stock with respect to dividends or other distributions or rights upon
liquidation, exclusive or class voting rights or with other terms and conditions, or (ii) could
delay, defer or prevent a transaction or a change in control of our company that might involve a
premium price for our Common Stock or that our common stockholders otherwise believe to be
in their best interest. In addition, our issuance of additional shares of stock in the future could
2
dilute the voting and other rights of your shares. See “Certain Provisions of Maryland Law and
Our Charter and Bylaws.”
Restrictions on Ownership and Transfer
In order to maintain our qualification as a REIT under the Internal Revenue Code of
1986, as amended, (the “Code”), our shares of stock must be beneficially owned by 100 or more
persons during at least 335 days of a taxable year of 12 months (other than the first year for
which an election to be a REIT has been made) or during a proportionate part of a shorter taxable
year. Also, not more than 50% of the value of our outstanding shares of capital stock may be
owned, directly or indirectly, by five or fewer individuals (as defined in the Code to include
certain entities) during the last half of a taxable year (other than the first year for which an
election to be a REIT has been made).
In order to qualify as a REIT and for other purposes, our charter, subject to certain
exceptions, contains restrictions on the number of shares of our stock that a person, as defined by
the charter, may own. Our charter provides that, subject to the exceptions described below, no
person may beneficially or constructively own (i) more than 9.8% in value or in number of
shares, whichever is more restrictive, of the outstanding shares of our Common Stock, or (ii)
more than 9.8% in value or in number of shares, whichever is more restrictive, of the aggregate
of the outstanding shares of all classes and series of our capital stock. We refer to the foregoing
restrictions as the “Ownership Limits.”
Our charter also prohibits any person from:
•
beneficially or constructively owning shares of our capital stock to the extent that such
beneficial or constructive ownership would result in our being “closely held” within the
meaning of Section 856(h) of the Code (without regard to whether the ownership interest
is held during the last half of the taxable year);
•
transferring shares of our capital stock to the extent that such transfer would result in our
shares of capital stock being beneficially owned by fewer than 100 persons (determined
under the principles of Section 856(a)(5) of the Code);
•
beneficially or constructively owning shares of our capital stock to the extent such
beneficial or constructive ownership would cause any income of the company that would
otherwise qualify as “rents from real property” for purposes of Section 856(d) of the
Code to fail to qualify as such (including, but not limited to, beneficial ownership or
constructive ownership that would result in the company actually or constructively
owning a 10% or greater interest in a tenant as described in Section 856(d)(2)(B) of the
Code); or
•
beneficially or constructively owning shares of our capital stock if such beneficial or
constructive ownership would otherwise cause us to fail to qualify as a REIT under the
Code.
Our Board of Directors, in its sole discretion, may prospectively or retroactively exempt a
person from certain of the limits described in the paragraph above and may establish or increase
an excepted holder percentage limit for that person. The person seeking an exemption must
provide to our Board of Directors any representations, covenants and undertakings that are
3
reasonably necessary for our Board of Directors to conclude that (i) granting the exemption will
not (a) result in our being “closely held,” (b) cause any of our income that would otherwise
qualify as “rents from real property” to fail to qualify as such or (c) cause us to otherwise fail to
qualify as a REIT and (ii) the person does not actually or constructively own an interest in a
tenant of the Company that would cause the Company to actually or constructively own more
than a 9.9% interest (as set forth in Section 856(d)(2)(B) of the Code) in such tenant. Such
person must also agree that any violation or attempted violation of such covenants (or any other
action that is contrary to the transfer and ownership restrictions contained in our charter) will
result in such shares of our capital stock being automatically transferred to a trust as described
below. Our Board of Directors may not grant an exemption to any person if that exemption
would result in our failing to qualify as a REIT. Our Board of Directors may require a ruling
from the Internal Revenue Service or an opinion of counsel, in either case in form and substance
satisfactory to our Board of Directors, in its sole discretion, in order to determine or ensure our
status as a REIT and may impose such conditions or restrictions as it deems appropriate in
connection with granting any such exemption.
Our Board of Directors may, in its sole and absolute discretion, increase or decrease any
or both of the Ownership Limits for one or more persons, except that a decreased ownership limit
will not be effective for any person whose actual, beneficial or constructive ownership of our
stock exceeds the decreased ownership limit at the time of the decrease until the person’s actual,
beneficial or constructive ownership of our stock equals or falls below the decreased ownership
limit, although any further acquisition of shares of our stock or beneficial or constructive
ownership of our stock will violate the decreased ownership limit. Our Board of Directors may
not increase or decrease any Ownership Limit if, among other limitations, the new ownership
limit would allow five or fewer persons to actually or beneficially own more than 49.9% in value
of our outstanding stock, could cause us to be “closely held” under Section 856(h) of the Code
(without regard to whether the ownership interest is held during the last half of a taxable year) or
could otherwise cause us to fail to qualify as a REIT.
Any attempted transfer of shares of our capital stock (or other event or change) which, if
effective, would violate any of the restrictions described above will result in the number of
shares of our capital stock causing the violation (rounded up to the nearest whole share) to be
automatically transferred to a trust or trusts for the exclusive benefit of one or more charitable
beneficiaries, except that any transfer that results in the violation of the restriction relating to
shares of our capital stock being beneficially owned by fewer than 100 persons will be void ab
initio. In either case, the proposed transferee will not acquire any rights in those shares. The
automatic transfer will be deemed to be effective as of the close of business on the business day
prior to the date of the purported transfer or other event that results in the transfer to the trust.
Shares held in the trust will be issued and outstanding shares. The proposed transferee will not
benefit economically from ownership of any shares held in the trust, will have no rights to
dividends or other distributions and will have no rights to vote or other rights attributable to the
shares held in the trust. The trustee of the trust will have all voting rights and rights to dividends
or other distributions with respect to shares held in the trust. These rights will be exercised for
the exclusive benefit of the charitable beneficiary. Any dividend or other distribution paid prior
to our discovery that shares have been transferred to the trust will be paid by the recipient to the
trustee upon demand. Any dividend or other distribution authorized but unpaid will be paid when
due to the trustee. Any dividend or other distribution paid to the trustee will be held in trust for
the charitable beneficiary. Subject to Maryland law, the trustee will have the authority (i) to
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rescind as void any vote cast by the proposed transferee prior to our discovery that the shares
have been transferred to the trust and (ii) to recast the vote in accordance with the desires of the
trustee acting for the benefit of the charitable beneficiary. However, if we have already taken
irreversible corporate action, then the trustee will not have the authority to rescind and recast the
vote.
Within 20 days of receiving notice from us that shares of our stock have been transferred
to the trust, the trustee will sell the shares to a person, designated by the trustee, whose
ownership of the shares will not violate the above ownership and transfer limitations. Upon the
sale, the interest of the charitable beneficiary in the shares sold will terminate and the trustee will
distribute the net proceeds of the sale to the proposed transferee and to the charitable beneficiary
as follows. The proposed transferee will receive the lesser of (i) the price paid by the proposed
transferee for the shares or, if the proposed transferee did not give value for the shares in
connection with the event causing the shares to be held in the trust (e.g., a gift, devise or other
similar transaction), the market price (as defined in our charter) of the shares on the day of the
event causing the shares to be held in the trust and (ii) the price per share received by the trustee
(net of any commissions and other expenses of sale) from the sale or other disposition of the
shares. The trustee may reduce the amount payable to the proposed transferee by the amount of
dividends or other distributions paid to the proposed transferee and owed by the proposed
transferee to the trustee. Any net sale proceeds in excess of the amount payable to the proposed
transferee will be paid immediately to the charitable beneficiary. If, prior to our discovery that
our shares of our stock have been transferred to the trust, the shares are sold by the proposed
transferee, then (i) the shares shall be deemed to have been sold on behalf of the trust and (ii) to
the extent that the proposed transferee received an amount for the shares that exceeds the amount
he or she was entitled to receive, pursuant to the above, the excess shall be paid to the trustee
upon demand.
In addition, shares of our stock held in the trust will be deemed to have been offered for
sale to us, or our designee, at a price per share equal to the lesser of (i) the price per share in the
transaction that resulted in the transfer to the trust (or, in the case of a devise, gift or other similar
transaction, the market price at the time of the devise, gift or other similar transaction) and (ii)
the market price on the date we, or our designee, accept the offer, which we may reduce by the
amount of dividends and other distributions paid to the proposed transferee and owed by the
proposed transferee to the trustee. We will have the right to accept the offer until the trustee has
sold the shares. Upon a sale to us, the interest of the charitable beneficiary in the shares sold will
terminate and the trustee will distribute the net proceeds of the sale to the proposed transferee.
If a transfer to a charitable trust, as described above, would be ineffective for any reason
to prevent a violation of a restriction, the transfer that would have resulted in a violation will be
void ab initio, and the proposed transferee shall acquire no rights in those shares.
Any certificate representing shares of our capital stock, and any notices delivered in lieu
of certificates with respect to the issuance or transfer of uncertificated shares, will bear a legend
referring to the restrictions described above.
Any person who acquires or attempts or intends to acquire beneficial or constructive
ownership of shares of our capital stock that will or may violate any of the foregoing restrictions
on transferability and ownership, or any person who would have owned shares of our capital
stock that resulted in a transfer of shares to a charitable trust, is required to give written notice
5
immediately to us or, in the case of a proposed or attempted transaction, to give at least 15 days’
prior written notice, and provide us with any other information as we may request in order to
determine the effect of the transfer on our status as a REIT. The foregoing restrictions on
transferability and ownership will not apply if our Board of Directors determines that it is no
longer in our best interests to attempt to qualify, or to continue to qualify, as a REIT or that
compliance is no longer required in order for us to qualify as a REIT.
Every owner of more than 5% (or any lower percentage as required by the Code or the
Treasury regulations promulgated thereunder) in number or value of the outstanding shares of
our capital stock, within 30 days after the end of each taxable year, is required to give us written
notice, stating his or her name and address, the number of shares of each class and series of
shares of our capital stock that he or she beneficially owns and a description of the manner in
which the shares are held. Each of these owners must promptly provide us with additional
information that we may request in order to determine the effect, if any, of his or her beneficial
ownership on our status as a REIT and to ensure compliance with the Ownership Limits. In
addition, each stockholder will upon demand be required to provide us with information that we
may request in order to determine our status as a REIT and to comply with the requirements of
any taxing authority or governmental authority or to determine our compliance.
These ownership limitations could delay, defer or prevent a transaction or a change in
control that might involve a premium price for our shares of Common Stock or otherwise be in
the best interest of our stockholders.
Certain Provisions of Maryland Law and Our Charter and Bylaws
The following summary of certain provisions of Maryland law and our charter and
bylaws does not purport to be complete and is subject to and qualified in its entirety by reference
to Maryland law and to our charter and our bylaws.
Our Board of Directors
According to our charter and bylaws, the number of directors of our company may be
established, increased or decreased only by a majority of our entire Board of Directors but may
not be fewer than the minimum number required under the MGCL (which is currently one) nor,
unless our bylaws are amended, more than eleven.
Any vacancy on the Board of Directors for any cause other than an increase in the
number of directors may be filled by a majority of the remaining directors, even if such majority
is less than a quorum. Any vacancy in the number of directors created by an increase in the
number of directors may be filled by a majority of the entire Board of Directors. Any individual
so elected as a director shall serve until the next annual meeting of stockholders and until his or
her successor is duly elected and qualifies.
Each of our directors will be elected by our common stockholders to serve until the next
annual meeting of our stockholders and until his or her successor is duly elected and qualifies
under the MGCL. Holders of shares of our Common Stock will have no right to cumulative
voting in the election of directors. Our bylaws provide that each director shall be elected by a
plurality of all of the votes cast in the election of directors.
6
Removal of Directors
Our charter provides that, subject to the rights of holders of one or more classes or series
of Preferred Stock to elect or remove one or more directors, a director may be removed at any
time, with or without cause and without the necessity for concurrence by the directors, by the
affirmative vote of the holders of not less than a majority of the votes outstanding and entitled to
be cast generally in the election of directors.
Business Combinations
Under the MGCL, certain “business combinations” (including a merger, consolidation,
statutory share exchange or, in certain circumstances specified under the statute, an asset transfer
or issuance or reclassification of equity securities) between a Maryland corporation and any
interested stockholder, or an affiliate of such an interested stockholder, are prohibited for five
years after the most recent date on which the interested stockholder becomes an interested
stockholder. Maryland law defines an interested stockholder as:
•
any person who beneficially owns, directly or indirectly, 10% or more of the voting
power of the corporation’s outstanding voting stock; or
•
an affiliate or associate of the corporation who, at any time within the two-year period
prior to the date in question, was the beneficial owner of 10% or more of the voting
power of the then-outstanding stock of the corporation.
A person is not an interested stockholder under the MGCL if the board of directors approved in
advance the transaction by which the person otherwise would have become an interested
stockholder. In approving a transaction, the Board of Directors may provide that its approval is
subject to compliance, at or after the time of the approval, with any terms and conditions
determined by it.
After such five-year period, any such business combination must be recommended by the
Board of Directors of the corporation and approved by the affirmative vote of at least:
•
80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the
corporation; and
•
two-thirds of the votes entitled to be cast by holders of voting stock of the corporation
other than shares held by the interested stockholder with whom (or with whose affiliate)
the business combination is to be effected or held by an affiliate or associate of the
interested stockholder.
These supermajority approval requirements do not apply if, among other conditions, the
corporation’s common stockholders receive a minimum price (as defined in the MGCL) for their
shares and the consideration is received in cash or in the same form as previously paid by the
interested stockholder for its shares.
These provisions of the MGCL do not apply, however, to business combinations that are
approved or exempted by a corporation’s board of directors prior to the time that the interested
stockholder becomes an interested stockholder. We have elected, by resolution of our Board, to
opt out of the business combination provisions of the MGCL, provided that such business
combination has been approved by our Board (including a majority of directors who are not
7
affiliated with the interested stockholder). Our bylaws provide that we may not opt-in to the
business combination provisions of the MGCL without the approval of our stockholders by the
affirmative vote of at least a majority of the votes cast on the matter by stockholders entitled to
vote generally in the election of our directors.
Control Share Acquisitions
The MGCL provides that a holder of “control shares” of a Maryland corporation acquired
in a “control share acquisition” has no voting rights with respect to those shares except to the
extent approved by the affirmative vote of at least two-thirds of the votes entitled to be cast by
stockholders entitled to exercise or direct the exercise of the voting power in the election of
directors generally but excluding: (i) the person who has made or proposes to make the control
share acquisition; (ii) any officer of the corporation; or (iii) any employee of the corporation who
is also a director of the corporation. “Control shares” are voting shares of stock that, if
aggregated with all other such shares of stock previously acquired by the acquirer or in respect of
which the acquirer is able to exercise or direct the exercise of voting power (except solely by
virtue of a revocable proxy), would entitle the acquirer to exercise voting power in electing
directors within one of the following ranges of:
•
one-tenth or more but less than one-third;
•
one-third or more but less than a majority; or
•
a majority or more of all voting power.
Control shares do not include shares that the acquiring person is then entitled to vote as a result
of having previously obtained stockholder approval or shares acquired directly from the
corporation. A “control share acquisition” means the acquisition, directly or indirectly, of
ownership of, or the power to direct the exercise of voting power with respect to, issued and
outstanding control shares, subject to certain exceptions.
A person who has made or proposes to make a control share acquisition, upon satisfaction
of certain conditions (including an undertaking to pay expenses and making an “acquiring person
statement” as described in the MGCL), may compel the board of directors of a company to call a
special meeting of stockholders to be held within 50 days of demand to consider the voting rights
of the control shares. If no request for a special meeting is made, the corporation may itself
present the question at any stockholders meeting.
If voting rights of control shares are not approved at the meeting or if the acquiring
person does not deliver an “acquiring person statement” as required by the statute, then, subject
to certain conditions and limitations, the corporation may redeem any or all of the control shares
(except those for which voting rights have previously been approved) for fair value. Fair value is
determined, without regard to the absence of voting rights for the control shares, as of the last
control acquisition by the acquirer or, if a meeting of stockholders is held at which rights of such
shares of stock are considered and not approved, as of the date of such meeting. If voting rights
for control shares are approved at a stockholder’s meeting and the acquirer becomes entitled to
vote a majority of the shares entitled to vote, all other stockholders may exercise appraisal rights.
The fair value of the shares as determined for purposes of such appraisal rights may not be less
than the highest price per share paid by the acquirer in the control share acquisition.
8
The control share acquisition statute does not apply (i) to shares acquired in a merger,
consolidation or statutory share exchange if the corporation is a party to the transaction or (ii) to
acquisitions approved or exempted by the charter or bylaws of the corporation.
Our bylaws contain a provision exempting from the control share acquisition statute any
and all acquisitions by any person of shares of our stock. Our Board of Directors may not amend
or eliminate this provision without the approval by the affirmative vote of at least a majority of
the votes cast on the matter by our stockholders entitled to vote generally in the election of our
directors.
Subtitle 8
Subtitle 8 of Title 3 of the MGCL permits a Maryland corporation with a class of equity
securities registered under the Securities Exchange Act, as amended, and with at least three
independent directors to elect to be subject, by provision in its charter or bylaws or by a
resolution of its board of directors and notwithstanding any contrary provision in its charter or
bylaws, to any or all of five provisions:
•
a classified board;
•
a requirement that a director may be removed only by the vote of the holders of two-
thirds of all votes entitled to be cast generally in the election of directors;
•
a requirement that the number of directors be fixed only by vote of the directors;
•
a requirement that a vacancy on the board of directors be filled only by the affirmative
vote of a majority of the remaining directors in office, even if the remaining directors do
not constitute a quorum, for the remainder of the full term of the class of directors in
which the vacancy occurred and until a successor is elected and qualified; and
•
a requirement that a special meeting of the stockholders be called at the request of
stockholders only if requested by stockholders entitled to cast at least a majority of the
votes entitled to be cast at the meeting.
Through provision in our charter and bylaws unrelated to Subtitle 8, we already vest in
our board the exclusive power to fix the number of directorships, subject to limitations set forth
in our charter and bylaws, and provide that a special meeting of stockholders will be called at the
request of stockholders entitled to cast a majority of votes entitled to be cast. As a result of the
Board’s previously adopted resolutions on September 20, 2021, we are prohibited from electing
to be subject to the provisions of Subtitle 8 that would permit us to classify the Board without
stockholder approval, and such prohibition may not be repealed unless a proposal to repeal such
prohibition is approved by the affirmative vote of at least a majority of the votes cast on the
matter by our stockholders entitled to vote generally in the election of our directors.
Amendments to Our Charter and Bylaws
Our charter generally may be amended only if such amendment is declared advisable by
our Board of Directors and approved by the affirmative vote of stockholders entitled to cast a
majority of the votes entitled to be cast on the matter. Our Board of Directors and stockholders
have the concurrent power to adopt, alter or repeal any provision of our bylaws and to make new
bylaws.
9
Exclusive Forum for Certain Disputes
Our bylaws provide that, unless we consent in writing to the selection of an alternative
forum, the Circuit Court for Baltimore City, Maryland, or, if that court does not have
jurisdiction, the United States District Court for the District of Maryland, Northern Division, will
be the sole and exclusive forum for (a) any Internal Corporate Claim, as such term is defined in
the MGCL, other than any action arising under federal securities laws, including, without
limitation, (i) any derivative action or proceeding brought on behalf of the corporation, (ii) any
action asserting a claim of breach of any duty owed by any director or officer or other employee
of the corporation to the corporation or to the stockholders of the corporation or (iii) any action
asserting a claim against the corporation or any director or officer or other employee of the
corporation arising pursuant to any provision of the MGCL, the charter or bylaws, or (b) any
action asserting a claim against the corporation or any director or officer or other employee of
the corporation that is governed by the internal affairs doctrine. This choice of forum provision
will limit a stockholder’s ability to bring a claim in another judicial forum, including in a judicial
forum that it believes is favorable for disputes with us or our directors, officers, managers, agents
or employees, which may discourage lawsuits against us and our directors, officers, managers,
agents or employees.
Meetings of Stockholders
Under our bylaws, annual meetings of stockholders will be held each year at a date and
time determined by our Board of Directors. Special meetings of stockholders may be called by
our Board of Directors, the chair of our Board of Directors, our president or our chief executive
officer. Additionally, subject to the provisions of our bylaws, special meetings of the
stockholders must be called by our secretary to act on any matter that may properly be
considered at a meeting of stockholders upon the written request of stockholders entitled to cast
not less than a majority of the votes entitled to be cast on such matter at such meeting who have
requested the special meeting in accordance with the procedures set forth in, and provided the
information and other materials required by, our bylaws. Only matters set forth in the notice of
the special meeting may be considered and acted upon at such a meeting.
Advance Notice of Director Nominations and New Business
Our bylaws provide that:
•
with respect to an annual meeting of stockholders, nominations of individuals for election
to our Board of Directors and the proposal of business to be considered by stockholders at
the annual meeting may be made only
◦
pursuant to our notice of the meeting;
◦
by or at the direction of our Board of Directors; or
◦
by a stockholder who was a stockholder of record at the record date set by our
Board of Directors for the purpose of determining stockholders entitled to vote at
the annual meeting, at the time of giving of the notice of the meeting and at the
time of the annual meeting, who is entitled to vote at the meeting in the election of
each individual nominated or on such other business, and who has complied with
10
the advance notice procedures set forth in, and provided the information and other
materials required by, our bylaws; and
•
with respect to special meetings of stockholders, only the business specified in our
company’s notice of meeting may be brought before the special meeting of stockholders,
and nominations of individuals for election to our Board of Directors may be made only
◦
by or at the direction of our Board of Directors;
◦
by a stockholder of the Company present in person at the special meeting that has
requested that a special meeting be called for the purpose of electing directors in
compliance with our bylaws and that has supplied the information and other
materials required by our bylaws with respect to each individual whom the
stockholder proposes to nominate for election of directors; or
◦
provided that the meeting has been called in accordance with our bylaws for the
purpose of electing directors, by a stockholder present in person at the special
meeting who is a stockholder of record at the record date set by the Board of
Directors for the purpose of determining stockholders entitled to vote at the
special meeting, at the time of giving of the notice required by our bylaws and at
the time of the meeting, who is entitled to vote at the meeting in the election of
each individual so nominated and who has complied with the advance notice
provisions set forth in and provided the information and other materials required
by, our bylaws.
The purpose of requiring stockholders to give advance notice of nominations and other proposals
is to afford our Board of Directors and our stockholders the opportunity to consider the
qualifications of the proposed nominees or the advisability of the other proposals and, to the
extent considered necessary by our Board of Directors, to inform stockholders and make
recommendations regarding the nominations or other proposals.
Proxy Access Procedures for Qualifying Stockholders
Our bylaws permit a stockholder, or a group of no more than 20 stockholders, that owns
at least 3% or more of the shares of our Common Stock continuously for at least three years to
nominate and include in our proxy materials candidates for election as directors of the Company,
subject to certain terms and conditions. Such stockholder(s) or group(s) of stockholders may
nominate director candidates constituting up to the greater of two individuals or 20% of our
Board of Directors, provided that the stockholder(s) and the director nominee(s) satisfy the
eligibility, notice and other requirements specified in the bylaws.
Limitation of Liability and Indemnification of Directors and Officers
Maryland law permits a Maryland corporation to include in its charter a provision
eliminating the liability of its directors and officers to the corporation and its stockholders for
money damages except for liability resulting from actual receipt of an improper benefit or profit
in money, property or services or active and deliberate dishonesty that is established by a final
judgment and is material to the cause of action. Our charter contains such a provision that
eliminates such liability to the maximum extent permitted by Maryland law.
11
The MGCL requires a Maryland corporation (unless its charter provides otherwise, which
our charter does not) to indemnify a director or officer who has been successful, on the merits or
otherwise, in the defense of any proceeding to which he or she is made a party by reason of his or
her service in that capacity. The MGCL permits a Maryland corporation to indemnify its present
and former directors and officers, among others, against judgments, penalties, fines, settlements
and reasonable expenses actually incurred by them in connection with any proceeding to which
they may be made a party by reason of their service in those or other capacities unless it is
established that:
•
the act or omission of the director or officer was material to the matter giving rise to the
proceeding and:
◦
was committed in bad faith; or
◦
was the result of active and deliberate dishonesty;
•
the director or officer actually received an improper personal benefit in money, property
or services; or
•
in the case of any criminal proceeding, the director or officer had reasonable cause to
believe that the act or omission was unlawful.
However, under the MGCL, a Maryland corporation may not indemnify a director or
officer for an adverse judgment in a suit by or in the right of the corporation or if the director or
officer was adjudged liable on the basis that personal benefit was improperly received, unless in
either case a court orders indemnification and then only for expenses. A court may order
indemnification if it determines that the director or officer is fairly and reasonably entitled to
indemnification, even though the director or officer did not meet the prescribed standard of
conduct or was adjudged liable on the basis that personal benefit was improperly received.
In addition, the MGCL permits a Maryland corporation to advance reasonable expenses to a
director or officer upon the corporation’s receipt of:
•
a written affirmation by the director or officer of his or her good faith belief that he or she
has met the standard of conduct necessary for indemnification by the corporation; and
•
a written undertaking, which may be unsecured, by the director or officer or on the
director’s or officer’s behalf to repay the amount paid if it shall ultimately be determined
that the standard of conduct has not been met.
Our charter and our bylaws obligate us, to the maximum extent permitted by Maryland law in
effect from time to time, to indemnify and to pay or reimburse reasonable expenses in advance of
final disposition of a proceeding without requiring a preliminary determination of the director’s
or officer’s ultimate entitlement to indemnification to:
•
any present or former director or officer who is made or threatened to be made a party to
the proceeding by reason of his or her service in that capacity; or
•
any individual who, while a director or officer of our company and at our request, serves
or has served as a director, officer, partner, member, manager or trustee of another
corporation, real estate investment trust, partnership, limited liability company, joint
12
venture, trust, employee benefit plan or other enterprise and who is made or threatened to
be made a party to the proceeding by reason of his or her service in that capacity.
Our charter and bylaws also permit us, with the approval of our Board of Directors, to indemnify
and advance expenses to any person who served a predecessor of ours in any of the capacities
described above and to any employee or agent of our company or a predecessor of our company.
Indemnification Agreements
We have entered into indemnification agreements with each of our directors and
executive officers that provide for indemnification to the maximum extent permitted by
Maryland law.
REIT Qualification
Our charter provides that our Board of Directors may revoke or otherwise terminate our
REIT election, without approval of our stockholders, if it determines that it is no longer in our
best interest to attempt to, or to continue to, be qualified as a REIT. Our charter also provides
that our Board of Directors may determine that compliance with the restrictions on ownership
and transfer of our stock is no longer required for us to qualify as a REIT.
13
Exhibit 10.7
DIRECTOR RESTRICTED STOCK UNIT AGREEMENT
This Restricted Stock Unit Agreement (this “Agreement”), dated as of May 7, 2024 (the “Grant Date”), is
made by and between InvenTrust Properties Corp., a Maryland corporation (the “Company”), and
[
] (the “Participant”).
WHEREAS, the Participant serves as a non-employee director on the Board of Directors of the Company (a
“Non-Employee Director”);
WHEREAS, the Company maintains the InvenTrust Properties Corp. 2015 Incentive Award Plan (as amended
from time to time, the “Plan”) and the InvenTrust Properties Corp. Director Compensation Program effective as of
May 5, 2022 (as amended from time to time, the “Program”);
WHEREAS, the Company wishes to carry out the Plan (the terms of which are hereby incorporated by
reference and made a part of this Agreement) and the Program;
WHEREAS, Section 9.4 of the Plan provides for the issuance of Restricted Stock Units (“RSUs”);
WHEREAS, Section 9.2 of the Plan provides for the issuance of Dividend Equivalent awards;
WHEREAS, the Program provides for the grant to Non-Employee Directors of RSUs and Dividend
Equivalents with respect thereto; and
WHEREAS, the Administrator has determined that it would be to the advantage and in the best interest of the
Company to issue the RSUs and Dividend Equivalents provided for herein to the Participant as an inducement to enter
into or remain in the service of the Company, and as an additional incentive during such service, and has advised the
Company thereof.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows:
1.
Issuance of Award of RSUs. Pursuant to the Plan, in consideration of the Participant’s agreement to
provide services to the Company, the Company hereby issues to the Participant an award of [
] RSUs. Each
RSU that vests shall represent the right to receive payment, in accordance with this Agreement, of one share of the
Company’s common stock, par value $0.001 per share (the “Common Stock”) or the Fair Market Value thereof, as set
forth herein. Unless and until an RSU vests, the Participant will have no right to payment in respect of any such RSU.
Prior to actual payment in respect of any vested RSU, such RSU will represent an unsecured obligation of the
Company, payable (if at all) only from the general assets of the Company.
2.
Dividend Equivalents. Each RSU granted hereunder is hereby granted in tandem with a corresponding
Dividend Equivalent, which Dividend Equivalent shall remain outstanding from the Grant Date until the earlier of the
payment or forfeiture of the RSU to which it corresponds. With respect to each dividend for which the record date
occurs on or after the Vesting Commencement Date specified in Exhibit A attached hereto and on or prior to the earlier
to occur of the payment or forfeiture of the RSU underlying such Dividend Equivalent, each outstanding Dividend
Equivalent shall entitle the Participant to receive payments equal to dividends paid, if any, on the Shares underlying the
RSU to which such Dividend Equivalent relates, payable in the same form and amounts as dividends paid to each
holder of a Share. Each such payment shall be made no later than sixty (60) days following the later of the Grant Date
or the applicable dividend payment date. Dividend Equivalents shall not entitle the Participant to any payments relating
to dividends for which the record date occurs after the earlier to occur of the payment or forfeiture of the RSU
underlying such Dividend Equivalent. In addition, notwithstanding the foregoing, in the event of a Termination of
Service for any reason, the Participant shall not be entitled to any Dividend Equivalent payments with respect to
dividends declared but not paid prior to the date of such termination on Shares underlying RSUs which are unvested as
of the date of such termination (after taking into account any accelerated vesting that occurs in connection with such
termination). Dividend Equivalents and any amounts that may become distributable in respect thereof shall be treated
separately from the RSUs and the rights arising in connection therewith for purposes of the designation of time and
form of payments required by Section 409A of the Code.
3.
Definitions. For purposes of this Agreement, the following terms shall have the meanings set forth
below. All capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in
the Plan.
(a)
“Disability” means a disability that would qualify the Participant to receive long-term
disability payments under the Company’s group long-term disability insurance plan or program, as it may be
amended from time to time, had the Participant been a participant in such plan or program.
(b)
“Service Provider” means an Employee, Consultant or member of the Board, as
applicable.
4.
RSUs and Dividend Equivalents Subject to the Plan; Ownership and Transfer Restrictions.
(a)
The RSUs and Dividend Equivalents are subject to the terms, definitions and provisions of the
Plan, which is incorporated herein by reference, including, without limitation, the restrictions on transfer set forth in
Section 10.3 of the Plan and the REIT restrictions set forth in Section 12.7 of the Plan.
(b)
Without limiting the foregoing, the RSUs and Common Stock issuable with respect thereto
shall be subject to the restrictions on ownership and transfer set forth in the charter of the Company, as amended
and supplemented from time to time.
5.
Vesting.
(a)
Time Vesting. Subject to Sections 5(b) and 6 below, the RSUs will vest and become
nonforfeitable in accordance with and subject to the vesting schedule set forth on Exhibit A
attached hereto, subject to the Participant’s continued status as a Service Provider on the
applicable vesting date.
(b)
Change in Control. Notwithstanding the foregoing, in the event that a Change in Control occurs
and the Participant has not incurred a Termination of Service prior to such Change in Control,
the RSUs will vest in full and become nonforfeitable immediately prior to such Change in
Control.
6.
Effect of Termination of Service.
(a)
Termination of Service. Except as may otherwise be determined by the Administrator, and
subject to Section 6(b) below, in the event of the Participant’s Termination of Service for any reason, any and all RSUs
that have not vested as of the date of such Termination of Service (after taking into account any accelerated vesting that
occurs in connection with such termination) will automatically and without further action be cancelled and forfeited
without payment of any consideration therefor, and the Participant shall have no further right to or interest in such
RSUs. No RSUs which have not vested as of the date of the Participant’s Termination of Service shall thereafter
become vested.
(b)
Termination Due to Death or Disability. In the event of the Participant’s Termination of
Service due to the Participant’s death or Disability, the RSUs will vest in full and become nonforfeitable upon such
Termination of Service.
7.
Payment. Payment of the RSUs that vest in accordance herewith shall be made to the Participant (or in
the event of the Participant’s death, to his or her estate) in whole Shares. Payments made in Shares shall be made by
the Company in the form of whole shares of Common Stock, and any fractional share shall be distributed in cash in an
amount equal to the value of such fractional share determined based on the Fair Market Value as of the date
immediately prior to such distribution. The Company shall make all such payments within sixty (60) days after such
vesting date, provided that, in the event of vesting upon a Change in Control under Section 5(b) above, such payment
shall be made or deemed made immediately preceding and effective upon the occurrence of such Change in Control.
8.
Restrictions on New RSUs or Shares. In the event that the RSUs or the Shares underlying the RSUs
are changed into or exchanged for a different number or kind of securities of the Company or of another corporation
or other entity by reason of merger, consolidation, recapitalization, reclassification, stock split, stock dividend or
combination of shares, such new or additional or different securities which are issued upon conversion of or in
exchange or substitution for RSUs or the Shares underlying the RSUs which are then subject to vesting shall be
subject to the same vesting conditions as such RSUs or Shares, as applicable, unless the Administrator provides for
the vesting of the RSUs or the Shares underlying the RSUs, as applicable.
9.
Conditions to Issuance of Shares. Shares issued as payment for the RSUs will be issued out of the
Company’s authorized but unissued Shares. Upon issuance, such Shares shall be fully paid and nonassessable. The
Shares issued pursuant to this Agreement shall be held in book-entry form and no certificates shall be issued therefor.
In addition to the other requirements set forth herein, the Shares issued as payment for the RSUs shall be issued only
upon the fulfillment of all of the following conditions:
(a)
The admission of such Shares to listing on all stock exchanges on which such class of stock
is then listed;
(b)
The completion of any registration or other qualification of such shares under any state or
federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental
regulatory body, which the Administrator shall, in its absolute discretion, deem necessary or advisable;
(c)
The obtaining of any approval or other clearance from any state or federal governmental
agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable;
(d)
The lapse of such reasonable period of time as the Administrator may from time to time
establish for reasons of administrative convenience; and
(e)
The receipt by the Company of full payment for any applicable withholding or other
employment tax or required payments with respect to any such Shares to the Company with respect to the
issuance or vesting of such Shares.
In the event that the Company delays a distribution or payment in settlement of RSUs because it
reasonably determines that the issuance of Shares in settlement of RSUs will violate federal securities laws or other
applicable law, such distribution or payment shall be made at the earliest date at which the Company reasonably
determines that the making of such distribution or payment will not cause such violation, as required by Treasury
Regulation Section 1.409A-2(b)(7)(ii). The Company shall not delay any payment if such delay will result in a
violation of Section 409A of the Code.
10.
Rights as Stockholder. Neither the Participant nor any person claiming under or through the Participant
will have any of the rights or privileges of a stockholder of the Company in respect of any Shares deliverable hereunder
unless and until such Shares will have been issued, recorded on the records of the Company or its transfer agents or
registrars, and delivered to the Participant or any person claiming under or through the Participant.
11.
Tax Withholding. The Company or any Subsidiary shall have the authority and the right to deduct or
withhold, or require the Participant to remit to such entity, an amount sufficient to satisfy federal, state, local and
foreign taxes (including the Participant’s FICA obligation) required by law to be withheld with respect to the issuance,
vesting or payment of the RSUs and the Dividend Equivalents. The Administrator may in its discretion and in
satisfaction of the foregoing requirement or in satisfaction of such additional withholding obligations as the Participant
may have elected, allow the Participant to elect to have the Company or the Subsidiary (as applicable) withhold Shares
otherwise issuable under such award (or allow the return of Shares) having a Fair Market Value equal to the sums to be
withheld. Notwithstanding any other provision of the Plan or this Agreement, the number of Shares which may be
withheld with respect to the issuance, vesting or payment of the RSUs in order to satisfy the Participant’s income and
payroll tax liabilities with respect to the issuance, vesting or payment of the RSUs and the Dividend Equivalents shall
be limited to the number of shares which have a fair market value on the date of withholding no greater than the
aggregate amount of such liabilities based on the maximum statutory withholding rates in the Participant’s applicable
jurisdictions for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such
supplemental taxable income.
12.
Remedies. The Participant shall be liable to the Company for all costs and damages, including
incidental and consequential damages, resulting from a disposition of the RSUs which is in violation of the
provisions of this Agreement. Without limiting the generality of the foregoing, the Participant agrees that the
Company shall be entitled to obtain specific performance of the obligations of the Participant under this Agreement
and immediate injunctive relief in the event any action or proceeding is brought in equity to enforce the same. The
Participant will not urge as a defense that there is an adequate remedy at law.
13.
Restrictions on Public Sale by the Participant. To the extent not inconsistent with applicable law, the
Participant agrees not to effect any sale or distribution of the RSUs or the Shares underlying the RSUs or any similar
security of the Company, or any securities convertible into or exchangeable or exercisable for such securities, including
a sale pursuant to Rule 144 under the Securities Act, during the fourteen (14) days prior to, and during the up to 90-day
period beginning on, the date of the pricing of any public or private debt or equity securities offering by the Company
(except as part of such offering), if and to the extent requested in writing by the Company in the case of a non-
underwritten public or private offering or if and to the extent requested in writing by the managing underwriter or
underwriters (or initial purchaser or initial purchasers, as the case may be) and consented to by the Company, which
consent may be given or withheld in the Company’s sole and absolute discretion, in the case of an underwritten public
or private offering (such agreement to be in the form of a lock-up agreement provided by the Company, managing
underwriter or underwriters, or initial purchaser or initial purchasers, as the case may be).
14.
Conformity to Securities Laws. The Participant acknowledges that the Plan and this Agreement are
intended to conform to the extent necessary with all provisions of all applicable federal and state laws, rules and
regulations (including, but not limited to the Securities Act and the Exchange Act and any and all regulations and rules
promulgated by the Securities and Exchange Commission thereunder, including without limitation the applicable
exemptive conditions of Rule 16b-3 of the Exchange Act) and to such approvals by any listing, regulatory or other
governmental authority as may, in the opinion of counsel for the Company, be necessary or advisable in connection
therewith. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the RSUs are granted,
only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the
Plan, this Agreement and the RSUs shall be deemed amended to the extent necessary to conform to such laws, rules
and regulations.
15.
Code Section 409A. To the extent applicable, this Agreement shall be interpreted in accordance with
Section 409A of the Code and Department of Treasury regulations and other interpretive guidance issued thereunder,
including without limitation any such regulations or other guidance that may be issued after the effective date of this
Agreement. Notwithstanding any provision of this Agreement to the contrary, in the event that following the effective
date of this Agreement, the Company determines that the RSUs may be subject to Section 409A of the Code and
related Department of Treasury guidance (including such Department of Treasury guidance as may be issued after the
effective date of this Agreement ), the Company may adopt such amendments to this Agreement or adopt other policies
and procedures (including amendments, policies and procedures with retroactive effect ), or take any other actions, that
the Company determines are necessary or appropriate to (a) exempt the RSUs from Section 409A of the Code and/or
preserve the intended tax treatment of the benefits provided with respect to the RSUs, or (b) comply with the
requirements of Section 409A of the Code and related Department of Treasury guidance; provided, however, that this
Section 15 shall not create any obligation on the part of the Company or any Subsidiary to adopt any such amendment,
policy or procedure or take any such other action. For purposes of Section 409A of the Code, any right to a series of
payments pursuant to this Agreement shall be treated as a right to a series of separate payments. Notwithstanding
anything to the contrary in this Agreement, no amounts shall be paid to the Participant under this Agreement during the
six-month period following the Participant’s “separation from service” to the extent that the Administrator determines
that the Participant is a “specified employee” (each within the meaning of Section 409A of the Code) at the time of
such separation from service and that paying such amounts at the time or times indicated in this Agreement would be a
prohibited distribution under Code Section 409A(a)(2)(b)(i). If the payment of any such amounts is delayed as a result
of the previous sentence, then on the first business day following the end of such six-month period (or such earlier date
upon which such amount can be paid under Section 409A of the Code without being subject to such additional taxes),
the Company shall pay to the Participant in a lump-sum all amounts that would have otherwise been payable to the
Participant during such six-month period under this Agreement.
16.
No Right to Continued Service. Nothing in this Agreement shall confer upon the Participant any right
to continue as a Service Provider of the Company or any Subsidiary, or shall interfere with or restrict in any way the
rights of the Company or any Subsidiary, which rights are hereby expressly reserved, to discharge the Participant at
any time for any reason whatsoever, with or without cause.
17.
Miscellaneous.
(a)
Incorporation of the Plan. This Agreement is made under and subject to and governed by all of
the terms and conditions of the Plan. In the event of any discrepancy or inconsistency between this Agreement and the
Plan, the terms and conditions of the Plan shall control. By signing this Agreement, the Participant confirms that he or
she has received access to a copy of the Plan and has had an opportunity to review the contents thereof.
(b)
Successors and Assigns. Subject to the limitations set forth in this Agreement, this Agreement
shall be binding upon, and inure to the benefit of, the executors, administrators, heirs, legal representatives, successors
and assigns of the parties hereto, including, without limitation, any business entity that succeeds to the business of the
Company.
(c)
Entire Agreement; Amendments and Waivers. This Agreement, together with the Plan,
constitutes the entire agreement among the parties pertaining to the subject matter hereof and supersedes all prior
agreements, understandings, negotiations and discussions, whether oral or written, of the parties. In the event that the
provisions of such other agreement conflict or are inconsistent with the provisions of this Agreement, the provisions of
this Agreement shall control. Except as set forth in Section 15 above, this Agreement may not be amended except in an
instrument in writing signed on behalf of each of the parties hereto and approved by the Administrator. No amendment,
supplement, modification or waiver of this Agreement shall be binding unless executed in writing by the party to be
bound thereby. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided.
(d)
Severability. If for any reason one or more of the provisions contained in this Agreement or in
any other instrument referred to herein shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, then to the maximum extent permitted by law, such invalidity, illegality or unenforceability shall not affect any
other provision of this Agreement or any other such instrument.
(e)
Titles. The titles, captions or headings of the Sections herein are inserted for convenience of
reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.
(f)
Counterparts. This Agreement may be executed in any number of counterparts, any of which
may be executed and transmitted by facsimile (including, without limitation, transfer by .pdf), and each of which shall
be deemed to be an original, but all of which together shall be deemed to be one and the same instrument.
(g)
Governing Law. This Agreement shall be governed by and construed in accordance with the
laws of the State of Maryland applicable to contracts entered into and wholly to be performed within the State of
Maryland by Maryland residents, without regard to any otherwise governing principles of conflicts of law that would
choose the law of any state other than the State of Maryland.
(h)
Notices. Any notice to be given by the Participant under the terms of this Agreement shall be
addressed to the Legal Department of the Company at the Company’s address set forth in Exhibit A attached hereto.
Any notice to be given to the Participant shall be addressed to him or her at the Participant’s then current address on the
books and records of the Company. By a notice given pursuant to this Section 17(h), either party may hereafter
designate a different address for notices to be given to him or her. Any notice which is required to be given to the
Participant shall, if the Participant is then deceased, be given to the Participant’s personal representative if such
representative has previously informed the Company of his or her status and address by written notice under this
Section 17(h) (and the Company shall be entitled to rely on any such notice provided to it that it in good faith believes
to be true and correct, with no duty of inquiry). Any notice required or permitted hereunder shall be given in writing
and shall be deemed effectively given upon personal delivery or upon deposit in the United States mail by certified
mail, with postage and fees prepaid, addressed as set forth above or upon confirmation of delivery by a nationally
recognized overnight delivery service.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.
INVENTRUST PROPERTIES CORP.,
a Maryland corporation
By:
Name:
Title:
The Participant hereby accepts and agrees to be bound by
all of the terms and conditions of this Agreement.
[____________________]
7
Exhibit A
Vesting Schedule and Notice Address
Vesting Commencement Date: May 7, 2024
Vesting Schedule: The RSUs shall vest in full on the earlier of (x) the date of the first annual meeting of the
Company’s stockholders following the Vesting Commencement Date or (y) the first anniversary of the Vesting
Commencement Date.
Company Address
3025 Highland Parkway
Suite 350
Downers Grove, IL 60515
Exhibit 19.1
InvenTrust Properties Corp. Insider Trading Compliance Policy
Federal and state laws prohibit trading in the securities of a company while in possession of material
nonpublic information and in breach of a duty of trust or confidence. These laws also prohibit anyone who is aware
of material nonpublic information from providing this information to others who may trade. InvenTrust Properties
Corp. (together with its subsidiaries, the “Company”) requires its personnel to comply at all times with federal laws
and regulations governing insider trading. Violating such laws can undermine investor trust, harm the reputation
and integrity of the Company, and result in dismissal from the Company or even serious criminal and civil charges
against the individual and the Company. The Company has adopted this Insider Trading Compliance Policy (this
“Policy”) to promote compliance with federal and state securities laws governing insider trading.
Persons Covered and Administration of Policy
This Policy applies to all officers, directors and employees of the Company. For purposes of this Policy,
“officers” refer to those individuals who meet the definition of “officer” under Section 16 of the Securities Exchange
Act of 1934 (as amended, the “Exchange Act”). Individuals subject to this Policy are responsible for ensuring that
members of their household comply with this Policy. This Policy also applies to any entities controlled by
individuals subject to the Policy, including any corporations, limited liability companies, partnerships or trusts, and
transactions by these entities should be treated for the purposes of this Policy as if they were for the individual’s own
account. The Company may determine that this Policy applies to additional persons with access to material
nonpublic information, such as contractors or consultants. Officers, directors and employees, together with any
other person designated as being subject to this Policy by the General Counsel or her or his designee (the
“Compliance Officer”), are referred to collectively as “Covered Persons.”
Questions regarding the Policy should be directed to the Compliance Officer, who is responsible for the
administration of this Policy.
Policy Statement
Unless otherwise permitted by this Policy, no Covered Person shall:
•
purchase, sell, gift or otherwise transfer any security of the Company while in possession of material
nonpublic information about the Company;
•
purchase, sell, gift or otherwise transfer any security of any other company while in possession of material
nonpublic information about the other company obtained in connection with your employment by or
service to the Company;
•
directly or indirectly communicate material nonpublic information to anyone outside the Company unless
in accordance with Company policy regarding confidential information; or
•
directly or indirectly communicate material nonpublic information to anyone within the Company except
on a “need-to-know” basis.
For this purpose:
“Securities” includes stocks, bonds, notes, debentures, options, warrants, equity and other convertible
securities, as well as derivative instruments.
“Purchase” and “sale” are defined broadly under the federal securities law. “Purchase” includes not only
the actual purchase of a security, but also any contract to purchase or otherwise acquire a security. “Sale” includes
not only the actual sale of a security, but also any contract to sell or otherwise dispose of a security. These
definitions extend to a broad range of transactions, including conventional cash-for-stock transactions, conversions,
the exercise of stock options, transfers, gifts, and acquisitions and exercises of warrants or puts, calls, pledging and
margin loans, or other derivative securities.
“Material” means there is a substantial likelihood that a reasonable investor would consider the information
important in making a decision to buy, sell, or hold a security, or if the information is likely to have a significant
effect on the market price of the security. Material information can be positive or negative, and can relate to
virtually any aspect of a company’s business or to any type of security, debt, or equity. Also, information that
something is likely to happen in the future—or even just that it may happen—could be deemed material.
“Nonpublic” means the information is not available to the general public. In order for information to be
considered “public,” it must be widely disseminated in a manner that makes it generally available to investors in a
Regulation FD-compliant method, such as through a press release, a filing with the U.S. Securities and Exchange
Commission (the “SEC”) or a Regulation FD-compliant conference call. The circulation of rumors, even if accurate
and reported in the media, does not constitute public dissemination. The Compliance Officer shall have sole
discretion to decide whether information is public for purposes of this Policy.
The laws and regulations concerning insider trading are complex, and Covered Persons are encouraged to
seek guidance from the Compliance Officer prior to considering a transaction in Company securities or if you have
any questions regarding this Policy. While you are encouraged to consult with the Compliance Officer, you should
be aware that the Compliance Officer cannot provide you with personal legal advice, and the Compliance Officer’s
approval is not a legal opinion that a transaction is lawful.
The Company reserves the right to take whatever disciplinary or other measure(s) it determines in its sole
discretion to be appropriate in any particular situation, including disclosure of wrongdoing to governmental
authorities.
Blackout Periods
No director, officer or employee (as well as any individual or entity covered by this Policy by virtue of their
relationship to such director, officer or employee) shall purchase or sell any security of the Company during the
period beginning on the 14th calendar day of the last month of any fiscal quarter of the Company and ending after
completion of the first full trading day after the public release of earnings data for such fiscal quarter or during any
other trading suspension period declared by the Company, such period, a “blackout period.” A “trading day” is a
day on which U.S. national stock exchanges are open for trading. If, for example, the Company were to make an
announcement on Monday prior to 9:30 a.m. Eastern Time, then the blackout period would terminate after the close
of trading on Monday. If an announcement were made on Monday after 9:30 a.m. Eastern Time, then the blackout
period would terminate after the close of trading on Tuesday. If you have any question as to whether information is
publicly available, please direct an inquiry to the Compliance Officer.
From time to time, the Compliance Officer may determine that an additional blackout period is appropriate
because of developments that have not yet been disclosed to the public. Persons subject to an additional blackout
period must neither trade in any of the Company’s securities nor disclose that an additional blackout period is in
effect.
The blackout period restrictions do not apply to:
•
purchases of the Company’s securities from the Company, or sales of the Company’s securities to the
Company;
•
gift transactions for family or estate planning purposes, where securities are gifted to a person or entity
subject to this Policy, except that gift transactions involving Company securities by a Preclearance Person
are subject to pre-clearance;
•
cashless exercises of equity incentive awards that do not involve an open-market sale of securities (e.g., not
a broker-assisted cashless exercise);
•
vesting of restricted stock units and settlement of such units in shares of the Company’s stock (including
“net settlement” of restricted stock units but not open-market sales to cover taxes upon the vesting of
restricted stock units);
•
“sell-to-cover” transactions pursuant to a non-discretionary policy adopted by the Company that is intended
to facilitate the payment of withholding taxes associated with vesting of equity awards (other than stock
options);
•
purchases of the Company’s securities under any Company dividend reinvestment plan that result from
your reinvestment of dividends paid on the Company securities held in such plan; however, these
prohibitions do apply to other purchases of Company securities under the plan that result from additional
contributions you choose to make to the dividend reinvestment plan, or to increases or decreases in your
level of participation in the plan, and also apply to your sale of any Company securities purchased pursuant
to the plan;
•
purchases of Company securities under any Company adopted Employee Stock Purchase Plan (“ESPP”);
however, these prohibitions do apply to the sales of Company securities you have purchased pursuant to the
ESPP as well as to your election to participate in the ESPP and to any elections to increase or decrease your
level of participation in the ESPP;
•
purchases or sales of the Company’s securities made pursuant to a plan adopted in accordance with the
Exchange Act Rule 10b5-1 (“Rule 10b5-1”) that has been preapproved by the Compliance Officer; or
•
transactions under a non-Rule 10b5-1 trading arrangement as defined in Item 408(c) of Regulation S-K that
has been preapproved by the Compliance Officer.
The Compliance Officer may approve additional exceptions to the blackout period restrictions.
Preclearance of Trades
All transactions in the Company’s securities by directors, officers, and employees (and their respective
controlled entities and members of their households) (each, a “Preclearance Person”) must be precleared by the
Compliance Officer, or the Chief Executive Officer for transactions by the Compliance Officer. Preclearance should
not be understood to represent legal advice by the Company that a proposed transaction complies with the law.
To submit a pre-clearance request, you must complete a Preclearance Request Form (which can be found
on the Company’s intranet, The Forum), which describes your proposed transaction, the proposed date of the
transaction, and the number of shares or other securities involved, and email it to the Compliance Officer at least
two business days in advance of the proposed transaction. Such Preclearance Request Form also includes a
certification to be executed by the Preclearance Person certifying that he or she is not in possession of material
nonpublic information about the Company. The Compliance Officer, or the Chief Executive Officer for transactions
by the Compliance Officer (or persons or entities subject to this Policy as a result of their relationship with the
Compliance Officer), shall have sole discretion to decide whether to clear any contemplated transaction. All trades
that are precleared must be effected within five business days of receipt of the preclearance, unless a specific
exception has been granted by the Compliance Officer. A precleared trade (or any portion of a precleared trade) that
has not been effected during the five business day period must be submitted for preclearance determination again
prior to execution. Notwithstanding receipt of preclearance, if the Preclearance Person becomes aware of material
nonpublic information, or becomes subject to a blackout period before the transaction is effected, the transaction
may not be completed.
None of the Company, the Compliance Officer, or the Company’s other employees will have any liability
for any delay in reviewing, or refusal of, a request for preclearance.
If the Company is required to impose a “pension fund blackout period” under Regulation BTR, each
director and executive officer shall not, directly or indirectly, sell, purchase, or otherwise transfer during such
blackout period any equity securities of the Company acquired in connection with his or her service as a director or
officer of the Company, except as permitted by Regulation BTR.
Prohibited Transactions
The Company has determined that there is a heightened legal risk and the appearance of improper or
inappropriate conduct if persons subject to this Policy engage in certain types of transactions. Therefore, Covered
Persons shall comply with the following policies with respect to certain transactions in the Company’s securities.
Short Sales
Short sales of the Company’s securities are prohibited by this Policy. Short sales of the Company’s
securities, or sales of shares that the insider does not own at the time of sale, or sales of shares against which the
insider does not deliver the shares within 20 days after the sale, evidence an expectation on the part of the seller that
the securities will decline in value, and, therefore, signal to the market that the seller has no confidence in the
Company or its short-term prospects. In addition, Section 16(c) of the Exchange Act prohibits Section 16 reporting
persons (i.e., directors, officers, and the Company’s 10% stockholders) from making short sales of the Company’s
equity securities.
Options
Transactions in puts, calls, or other derivative securities involving the Company’s equity securities, on an
exchange, on an over-the-counter market, or in any other organized market, are prohibited by this Policy. A
transaction in options is, in effect, a bet on the short-term movement of the Company’s stock and, therefore, creates
the appearance that a Covered Person is trading based on material nonpublic information. Transactions in options,
whether traded on an exchange, on an over-the-counter market, or any other organized market, also may focus a
Covered Person’s attention on short-term performance at the expense of the Company’s long-term objectives.
Hedging Transactions
Hedging transactions involving the Company’s securities, such as prepaid variable forward contracts,
equity swaps, collars and exchange funds, or other transactions that hedge or offset, or are designed to hedge or
offset, any decrease in the market value of the Company’s equity securities, are prohibited by this Policy. Such
transactions allow the Covered Person to continue to own the covered securities, but without the full risks and
rewards of ownership. When that occurs, the Covered Person may no longer have the same objectives as the
Company’s other stockholders.
Margin Accounts and Pledging
Individuals are prohibited from pledging Company securities as collateral for a loan, purchasing Company
securities on margin (i.e., borrowing money to purchase the securities), or placing Company securities in a margin
account. This prohibition does not apply to cashless exercises of stock options under the Company’s equity plans,
nor to situations approved in advance by the Compliance Officer.
Rule 10b5-1 Trading Plans
The trading restrictions set forth in this Policy, other than those transactions described under “Prohibited
Transactions,” do not apply to (1) transactions under a previously established contract, plan or instruction to trade in
the Company’s securities entered into in accordance with and that comply with the requirements of Rule 10b5-1 (a
“Trading Plan”) or (2) transactions under a previously established contract, plan or instruction to trade in the
Company’s securities that satisfies the elements of a non-Rule 10b5-1 trading arrangement (as defined in Item
408(c) of Regulation S-K)(a “Trading Arrangement”), in each case which has been submitted to and preapproved by
the Compliance Officer.
The Compliance Officer may impose such other conditions on the implementation and operation of the
Trading Plan or Trading Arrangement as the Compliance Officer deems necessary or advisable. Individuals may not
adopt more than one Trading Plan at a time except under the limited circumstances permitted by Rule 10b5-1 and
subject to preapproval by the Compliance Officer.
An individual may only modify a Trading Plan or Trading Arrangement outside of a blackout period and, in
any event, when the individual does not possess material nonpublic information. Modifications to and terminations
of a Trading Plan and Trading Arrangements are subject to preapproval by the Compliance Officer and
modifications of a Trading Plan that change the amount, price, or timing of the purchase or sale of the securities
underlying a Trading Plan will trigger a new cooling-off period as required by Rule 10b5-1.
The Company reserves the right to publicly disclose, announce, or respond to inquiries from the media
regarding the adoption, modification, or termination of a Trading Plan and Trading Arrangements, or the execution
of transactions made under a Trading Plan or Trading Arrangements. The Company also reserves the right from time
to time to suspend, discontinue, or otherwise prohibit transactions under a Trading Plan or Trading Arrangement if
the Compliance Officer or the Board of Directors, in its discretion, determines that such suspension, discontinuation,
or other prohibition is in the best interests of the Company.
Compliance of a Trading Plan with the requirements of Rule 10b5-1 and the execution of transactions
pursuant to the Trading Plan are the sole responsibility of the person initiating the Trading Plan, and none of the
Company, the Compliance Officer, or the Company’s other employees assumes any liability for any delay in
reviewing and/or refusing to approve a Trading Plan submitted for approval, nor the legality or consequences
relating to a person entering into, informing the Company of, or trading under, a Trading Plan.
Post-Termination Transactions
If an individual is in possession of material nonpublic information when the individual’s service terminates,
the individual may not trade in the Company’s securities until that information has become public or is no longer
material.
Policy Administration
The Compliance Officer has the authority to interpret, amend and implement this Policy. This authority
includes interpreting or waiving the terms of the Policy to the extent consistent with its general purpose and
applicable securities laws.
Actions taken by the Company, the Compliance Officer, or any other Company personnel do not constitute
legal advice, nor do they insulate you from the consequences of noncompliance with this Policy or with securities
laws.
You should be aware that regulatory agencies such as the SEC, the Department of Justice and FINRA
regularly inquire about market trading in securities. If the Company receives such an inquiry, the Company intends
to cooperate and will provide information requested, such as information regarding individuals’ trading and
awareness of material nonpublic information.
Certification of Compliance
All directors, officers, employees and others subject to this Policy may be asked periodically to certify their
compliance with the terms and provisions of this Policy.
Effective Date: November 6, 2024
INVENTRUST PROPERTIES CORP.
List of Subsidiaries
Entity Name
Domestic Jurisdiction
A-S 66 Beltway 8-Blackhawk, L.P.
Texas
IA Arlington Riverview GP, L.L.C.
Delaware
IA Arlington Riverview Limited Partnership
Illinois
IA Arlington Riverview LP, L.L.C.
Delaware
IA Atlanta Buckhead Member, L.L.C.
Delaware
IA Atlanta Buckhead, L.L.C.
Delaware
IA Austin Scofield GP, L.L.C.
Delaware
IA Austin Scofield Limited Partnership
Illinois
IA Austin Scofield LP, L.L.C.
Delaware
IA Cypress Cyfair GP, L.L.C.
Delaware
IA Cypress Cyfair Limited Partnership
Illinois
IA Cypress Cyfair LP, L.L.C.
Delaware
IA Laquinta Pavilion, L.L.C.
Delaware
IA League City Bay Colony GP, L.L.C.
Delaware
IA League City Bay Colony Limited Partnership
Illinois
IA League City Bay Colony LP, L.L.C.
Delaware
IA Matthews Sycamore GP, LLC
Delaware
IA Matthews Sycamore LP, LLC
Delaware
IA Matthews Sycamore, LP
Delaware
IA Newnan Coweta, L.L.C.
Delaware
IA Newnan Thomas, L.L.C.
Delaware
IA Ocoee Plantation Grove, L.L.C.
Delaware
IA Orlando Suncrest Village, L.L.C.
Delaware
IA Port Charlotte Peachland, L.L.C.
Delaware
IA Raleigh Bent Tree GP, LLC
Delaware
IA Raleigh Bent Tree LP, LLC
Delaware
IA Raleigh Bent Tree, LP
Delaware
IA Richardson Custer Creek GP, L.L.C.
Delaware
IA Richardson Custer Creek Limited Partnership
Illinois
IA Richardson Custer Creek LP, L.L.C.
Delaware
IA Round Rock University Oaks GP, L.L.C.
Delaware
IA Round Rock University Oaks Limited Partnership
Illinois
IA Round Rock University Oaks LP, L.L.C.
Delaware
IA San Pedro Garden, L.L.C.
Delaware
IA Sarasota Tamiami, L.L.C.
Delaware
IA St. Petersburg Gateway, L.L.C.
Delaware
IA Tucker Hugh Howell, L.L.C.
Delaware
IA Westlake GP, L.L.C.
Delaware
IA Westlake Limited Partnership
Illinois
IA Westlake LP, L.L.C.
Delaware
IA Wildomar Bear Creek, L.L.C.
Delaware
IA Woodstock Rose Creek, L.L.C.
Delaware
InvenTrust Properties Corp.
Maryland
InvenTrust Property Management, LLC
Delaware
Exhibit 21.1
IVT Acquisitions Corp.
Delaware
IVT Antoine Town Center Houston, LLC
Delaware
IVT Bay Landing Bonita Springs, LLC
Delaware
IVT Campus Marketplace San Marcos, LLC
Delaware
IVT Cary Park Town Center GP, LLC
Delaware
IVT Cary Park Town Center LP, LLC
Delaware
IVT Cary Park Town Center, LP
Delaware
IVT Commons at University Place Durham GP, LLC
Delaware
IVT Commons at University Place Durham LP, LLC
Delaware
IVT Commons at University Place Durham, LP
Delaware
IVT Creedmoor Raleigh GP, LLC
Delaware
IVT Creedmoor Raleigh LP, LLC
Delaware
IVT Creedmoor Raleigh, LP
Delaware
IVT Cypress Cyfair, LLC
Delaware
IVT Dallas Prestonwood, LLC
Delaware
IVT Eastfield Village Huntersville, LLC
Delaware
IVT Eldorado Marketplace Frisco, LLC
Delaware
IVT Escarpment Village Austin, LLC
Delaware
IVT Forum Fort Myers, LLC
Delaware
IVT Highland at Flower Mound Prairie Road, LLC
Delaware
IVT Highlands at Flower Mound GP, LLC
Delaware
IVT Highlands at Flower Mound LP, LLC
Delaware
IVT Highlands at Flower Mound, LP
Illinois
IVT Kennesaw Marketplace, LLC
Delaware
IVT Kyle Marketplace, LLC
Delaware
IVT Lakeside Crossing Winter Park, LLC
Delaware
IVT Lakeside Winter Park, LLC
Delaware
IVT Maguire Groves Ocoee, LLC
Delaware
IVT Market at Mill Creek Mt. Pleasant, LLC
Delaware
IVT Moores Mill Atlanta, LLC
Delaware
IVT Nexton Square Summerville, LLC
Delaware
IVT Northcross Center Huntersville GP, LLC
Delaware
IVT Northcross Center Huntersville LP, LLC
Delaware
IVT Northcross Center Huntersville, LP
Delaware
IVT Old Grove Marketplace Oceanside, LLC
Delaware
IVT OP GP, LLC
Delaware
IVT OP Limited Partnership
Delaware
IVT Paraiso Parc Pembroke Pines, LLC
Delaware
IVT Parke Cedar Park, LLC
Delaware
IVT PGA Plaza Palm Beach Gardens, LLC
Delaware
IVT Plant Chandler, LLC
Delaware
IVT Plaza Escondida Tucson, LLC
Delaware
IVT Plaza Midtown Atlanta, LLC
Delaware
IVT Port Charlotte Peachland, LLC
Delaware
IVT Renaissance Center Durham I GP, LLC
Delaware
IVT Renaissance Center Durham I LP, LLC
Delaware
IVT Renaissance Center Durham I, LP
Delaware
IVT Renaissance Center Durham II, LLC
Delaware
IVT Retail TRS, Inc.
Delaware
IVT Rio Pinar Plaza Orlando, LLC
Delaware
IVT River Oaks Valencia, LLC
Delaware
IVT Riverwalk Market Flower Mound, LLC
Delaware
IVT Sandy Plains Centre Marietta, LLC
Delaware
IVT Scottsdale North Marketplace, LLC
Delaware
IVT Shoppes at Davis Lake Charlotte, LLC
Delaware
IVT Shoppes at Fairview, LLC
Delaware
IVT Shops at Arbor Trails Austin, LLC
Delaware
IVT Shops at Galleria Bee Cave, LLC
Delaware
IVT Shops at Town Center Germantown, LLC
Delaware
IVT Sonterra Village San Antonio, LLC
Delaware
IVT Southern Royal Palm Beach, LLC
Delaware
IVT Spring Stables, LLC
Delaware
IVT Stevenson Ranch Plaza, LLC
Delaware
IVT Stone Ridge San Antonio, LLC
Delaware
IVT Stonehenge Village Midlothian, LLC
Delaware
IVT Travilah Square Rockville, LLC
Delaware
IVT Trowbridge Crossing Sandy Springs, LLC
Delaware
IVT Westfork Plaza Pembroke Pines, LLC
Delaware
IVT Westpark Glen Allen, LLC
Delaware
IVT Windward Commons Alpharetta, LLC
Delaware
MB Cypress Cyfair GP, L.L.C.
Delaware
MB Cypress Cyfair Limited Partnership
Illinois
MB Cypress Cyfair LP, L.L.C.
Delaware
MB Houston Blackhawk GP, L.L.C.
Delaware
MB Houston Blackhawk LP, L.L.C.
Delaware
MB Houston Eldridge GP, L.L.C.
Delaware
MB Houston Eldridge Limited Partnership
Illinois
MB Houston Eldridge LP, L.L.C.
Delaware
MB Houston Eldridge Town Center GP, L.L.C.
Delaware
MB Houston Eldridge Town Center Limited Partnership
Illinois
MB Houston Eldridge Town Center LP, L.L.C.
Delaware
MB Houston Windemere GP, L.L.C.
Delaware
MB Houston Windemere Limited Partnership
Illinois
MB Houston Windemere LP, L.L.C.
Delaware
MB League City Bay Colony GP, L.L.C.
Delaware
MB League City Bay Colony Limited Partnership
Illinois
MB League City Bay Colony LP, L.L.C.
Delaware
MB Spring Stables GP, L.L.C.
Delaware
MB Spring Stables Limited Partnership
Illinois
MB Spring Stables LP, L.L.C.
Delaware
SB Retail Insurance Company, LLC
Vermont
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in the registration statements (No. 333-172862 and No. 333-263342)
on Form S-3 and (No. 333-199234, No. 333-205098 and No. 333-274019) on Form S-8 of our reports dated
February 13, 2025, with respect to the consolidated financial statements of InvenTrust Properties Corp. and the
effectiveness of internal control over financial reporting.
/s/ KPMG, LLP
Chicago, Illinois
February 13, 2025
Exhibit 23.1
Certification of Principal Executive Officer
I, Daniel J. Busch, certify that:
1.
I have reviewed this Annual Report on Form 10-K of InvenTrust Properties Corp.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present
in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4.
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial
reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period
in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, 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;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report
our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred
during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control
over financial reporting; and
5.
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or
persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role
in the registrant’s internal control over financial reporting.
Date:
February 13, 2025
By:
/s/ Daniel J. Busch
Name: Daniel J. Busch
Title:
President and Chief Executive Officer (Principal Executive Officer)
Exhibit 31.1
Certification of Principal Financial Officer
I, Michael Phillips, certify that:
1.
I have reviewed this Annual Report on Form 10-K of InvenTrust Properties Corp.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present
in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4.
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial
reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period
in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, 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;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report
our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred
during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control
over financial reporting; and
5.
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or
persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role
in the registrant’s internal control over financial reporting.
Date:
February 13, 2025
By:
/s/ Michael Phillips
Name: Michael Phillips
Title:
Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)
Exhibit 31.2
Certification of Principal Executive Officer
Pursuant To 18 U.S.C. Section 1350,
as Adopted Pursuant to
Section 906 of The Sarbanes-Oxley Act of 2002
In connection with the Annual Report on Form 10-K of InvenTrust Properties Corp. (the "Company") for the year ended
December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned
officer of the Company certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that to such officer’s knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as
amended; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of
operations of the Company.
Date:
February 13, 2025
By:
/s/ Daniel J. Busch
Name: Daniel J. Busch
Title:
President and Chief Executive Officer (Principal Executive Officer)
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by
the Company and furnished to the Securities and Exchange Commission or its staff upon request.
The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as a part of the
Report or on a separate disclosure document.
Exhibit 32.1
Certification of Principal Financial Officer
Pursuant To 18 U.S.C. Section 1350,
as Adopted Pursuant to
Section 906 of The Sarbanes-Oxley Act of 2002
In connection with the Annual Report on Form 10-K of InvenTrust Properties Corp. (the "Company") for the year ended
December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned
officer of the Company certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that to such officer’s knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as
amended; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of
operations of the Company.
Date:
February 13, 2025
By:
/s/ Michael Phillips
Name: Michael Phillips
Title:
Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by
the Company and furnished to the Securities and Exchange Commission or its staff upon request.
The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as a part of the
Report or on a separate disclosure document.
Exhibit 32.2