128 added · 92 removed between the two most recent 10-Ks. The risks a company starts — or stops — disclosing are often the story.
Newly disclosed
As of December 31, 2025, we were in compliance with all default related debt covenants. 34 Table of Contents On February 14, 2025, we amended our existing at-the-market (“ATM”) equity program under which we may from time to time offer and sell common shares.
Acquisitions are moved to comparable properties once we have owned the property for the entirety of comparable periods and the property is not under development or being repositioned for significant redevelopment and investment. 37 Table of Contents YEAR ENDED DECEMBER 31, 2025 COMPARED TO YEAR ENDED DECEMBER 31, 2024 Change 2025 2024 Dollars % (Dollar amounts in thousands) Rental income $ 1,245,491 $ 1,170,078 $ 75,413 6.4 % Other property income 32,371 31,258 1,113 3.6 % Mortgage interest income 1,113 1,116 (3) (0.3) % Total property revenue 1,278,975 1,202,452 76,523 6.4 % Rental expenses 267,445 249,569 17,876 7.2 % Real estate taxes 151,438 142,230 9,208 6.5 % Total property expenses 418,883 391,799 27,084 6.9 % Property operating income (1) 860,092 810,653 49,439 6.1 % General and administrative expense (46,913) (49,739) 2,826 (5.7) % Depreciation and amortization (367,842) (342,598) (25,244) 7.4 % New market tax credit transaction income 14,176 — 14,176 100.0 % Gain on sale of real estate 150,111 54,040 96,071 177.8 % Impairment charge (7,425) — (7,425) 100.0 % Operating income 602,199 472,356 129,843 27.5 % Other interest income 3,143 4,294 (1,151) (26.8) % Interest expense (183,614) (175,476) (8,138) 4.6 % Income from partnerships 1,920 3,160 (1,240) (39.2) % Total other, net (178,551) (168,022) (10,529) 6.3 % Net income 423,648 304,334 119,314 39.2 % Net income attributable to noncontrolling interests (12,571) (9,126) (3,445) 37.7 % Net income attributable to the Trust $ 411,077 $ 295,208 $ 115,869 39.2 % (1) Property operating income is a non-GAAP measure that consists of rental income and mortgage interest income, less rental expenses and real estate taxes.
The reconciliation of operating income to property operating income for 2025 and 2024 is as follows: 2025 2024 (in thousands) Operating income $ 602,199 $ 472,356 General and administrative 46,913 49,739 Depreciation and amortization 367,842 342,598 New market tax credit transaction income (14,176) — Gain on sale of real estate (150,111) (54,040) Impairment charge 7,425 — Property operating income $ 860,092 $ 810,653 Property Revenues Total property revenue increased $76.5 million, or 6.4%, to $1.28 billion in 2025 compared to $1.20 billion in 2024.
This increase is primarily driven by higher gains on sale of real estate, higher rental rates and average occupancy, income related to the sale of the new market tax credits, and 2025 and 2024 acquisitions, partially offset by property dispositions, impairment charge, and higher collectibility related adjustments.
Discussions of year-to-year comparisons between 2024 and 2023 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the Securities and Exchange Commission on February 13, 2025. 40 Table of Contents Liquidity and Capital Resources Due to the nature of our business and strategy, we typically generate significant amounts of cash from operations which is largely paid to our common and preferred shareholders in the form of dividends because as a REIT, the Trust is generally required to make annual distributions to shareholders of at least 90% of our taxable income (cash dividends paid in 2025 were approximately $389.7 million).
The increase was primarily attributable to: • a $461.3 million increase in acquisition of real estate primarily due to the acquisitions of the fee interest in Village Pointe in November 2025, Annapolis Town Center in October 2025, Town Center Crossing and Town Center Plaza in July 2025 and Del Monte Shopping Center in February 2025 (see Note 3 to the consolidated financial statements for additional information), as compared to the acquisitions of the fee interest in Virginia Gateway in May 2024 and Pinole Vista Crossing in July 2024, and • $44.6 million increase in capital expenditures, partially offset by, • a $205.7 million increase in net proceeds from the sale of real estate primarily due to $305.6 million of net proceeds from the sale of a residential building at both Santana Row and Pike & Rose, our Hollywood Boulevard and Bristol properties, and a portion of our White Marsh Other property in 2025, as compared to $99.9 million of net proceeds from the sale of Third Street Promenade and a portion of our White Marsh Other property in 2024.
The reconciliation of net income attributable to common shareholders to Nareit FFO and Core FFO is as follows: Year Ended December 31, 2025 2024 2023 (In thousands, except per share data) Reconciliation of net income attributable to common shareholders to Nareit FFO Net income $ 423,648 $ 304,334 $ 247,217 Net income attributable to noncontrolling interests (12,571) (9,126) (10,232) Gain on sale of real estate (150,111) (54,040) (9,881) Impairment charge 7,425 — — Depreciation and amortization of real estate assets 320,311 302,455 285,689 Amortization of initial direct costs of leases 42,671 33,377 31,208 Funds from operations 631,373 577,000 544,001 Dividends on preferred shares (1) (7,500) (7,500) (7,500) Income attributable to downREIT operating partnership units 2,463 2,743 2,767 Income attributable to unvested shares (2,080) (2,004) (1,955) Funds from operations available for common shareholders $ 624,256 $ 570,239 $ 537,313 Weighted average number of common shares, diluted (1)(2) 86,498 84,286 82,044 Funds from operations available for common shareholders, per diluted share $ 7.22 $ 6.77 $ 6.55 Reconciliation of Nareit FFO to Core FFO Nareit FFO $ 624,256 $ 570,239 $ 537,313 Adjustments: New market tax credit transaction income, net (3) (13,004) — — Executive transition costs — 3,687 — Collection of prior period rents deferred during COVID (261) (3,218) (5,136) Core FFO $ 610,991 $ 570,708 $ 532,177 Core FFO per diluted share (2) $ 7.06 $ 6.77 $ 6.49 _____________________ (1) For the years ended December 31, 2025, 2024 and 2023, dividends on our Series 1 preferred stock were not deducted in the calculation of FFO available to common shareholders, as the related shares were dilutive and included in "weighted average number of common shares, diluted." (2) The weighted average common shares used to compute FFO per diluted common share includes shares issuable upon the assumed redemption of outstanding downREIT operating partnership units that were excluded from the computation of diluted EPS.
During the fourth quarter of 2025, we recognized a $7.4 million impairment charge related to our North Dartmouth property, as a result of an impairment analysis.
Impairment Charge The $7.4 million impairment charge for the year ended December 31, 2025 relates to our North Dartmouth property.
If leases currently classified as not probable are subsequently changed to probable, any lease receivables (including straight-line rent receivables) are re-instated with a corresponding increase to rental income. 32 Table of Contents Real Estate Acquisitions Upon acquisition of operating real estate properties, we estimate the fair value of assets and liabilities acquired including land, building, improvements, leasing costs, intangibles such as acquired leases, assumed debt, and current assets and liabilities, if any.
These properties are located primarily in major coastal markets and select underserved markets that we believe have strong economic and demographic fundamentals.As of December 31, 2025, we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 104 predominantly retail real estate projects comprising approximately 28.8 million commercial square feet.
We have aligned our program and efforts with the United Nations Sustainable Development Goals, as described 31 Table of Contents in our Sustainability Policy and our 2024 sustainability report, which are provided only for informational purposes on our website and not incorporated by reference herein.
No longer disclosed
These estimates have a direct impact on net income, because recording an impairment charge results in a negative adjustment to net income. 33 Table of Contents Recently Adopted and Recently Issued Accounting Pronouncements See Note 2 to the consolidated financial statements. 2024 Acquisitions and Dispositions On May 31, 2024, we acquired the fee interest in Virginia Gateway, which is comprised of five adjacent shopping centers in Gainesville, Virginia, totaling 664,000 square feet, for $215.0 million.
Discussions of year-to-year comparisons between 2023 and 2022 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission on February 12, 2024.
The increase was primarily attributable to: • a $213.3 million increase in acquisition of real estate primarily due to the May 2024 acquisition of the Virginia Gateway and the July 2024 acquisition of Pinole Vista Crossing (see Note 3 to the consolidated financial statements for additional information), as compared to the January 2023 Huntington Square acquisition and the acquisition of our partner's 22.3% TIC interest in Escondido Promenade in May 2023, partially offset by, • a $71.5 million increase in net proceeds from the sale of real estate primarily due to $99.9 million of net proceeds from the sale of Third Street Promenade and a portion of our White Marsh Other property in 2024, as compared to $28.5 million of net proceeds from the sale of Town Center of New Britain and a portion of Third Street Promenade in 2023, and • a $64.4 million decrease in capital expenditures.
The increase was primarily attributable to: 41 Table of Contents • a $325.0 million increase in repayment of senior notes due to the January 2024 repayment of our $600.0 million 3.95% senior unsecured notes at maturity, as compared to the June 2023 repayment of our $275.0 million 2.75% senior unsecured notes, • $199.2 million in net proceeds from the mortgage loan secured by our Bethesda Row property, which was entered into in December 2023, • a $19.4 million premium paid for the capped call transaction entered into in connection with the issuance of $485.0 million 3.25% exchangeable senior notes in January 2024, • a $12.4 million increase in dividends paid to common and preferred shareholders due to an increase in the number of outstanding shares, as well as an increase to the common share dividend rate, and • a $12.3 million increase in distributions to and redemptions of noncontrolling interests primarily related to our April 2024 acquisition of the noncontrolling interest in the partnership that owns our CocoWalk property for approximately $12.4 million, partially offset by, • a $172.2 million increase in net proceeds from the issuance of common shares under our ATM program, • a $125.8 million net increase in proceeds from the issuance of senior notes due to net proceeds of $471.5 million from the issuance of $485.0 million 3.25% exchangeable senior notes in January 2024, as compared to $345.7 million in net proceeds from the issuance of $350.0 million of 5.375% senior unsecured notes in April 2023, and • a $55.0 million decrease in repayment of mortgages, finance leases, and notes payable primarily due to the October 2023 finance lease buyout (see Note 3 to the consolidated financial statements for additional information) Cash Requirements The following table provides a summary of material cash requirements comprising our fixed, noncancelable obligations as of December 31, 2024: Cash Requirements by Period Total Next Twelve Months Greater than Twelve Months (In thousands) Fixed and variable rate debt (principal only) (1) $ 4,496,724 $ 848,130 $ 3,648,594 Fixed and variable rate debt - our share of unconsolidated real estate partnerships (principal only)(2) 62,467 34,877 27,590 Lease obligations (minimum rental payments) (3) 287,930 6,608 281,322 Redevelopments/capital expenditure contracts 252,365 228,394 23,971 Real estate commitments (4) 9,713 — 9,713 Total estimated cash requirements $ 5,109,199 $ 1,118,009 $ 3,991,190 _____________________ (1) The weighted average interest rate on our fixed and variable rate debt is 3.9% as of December 31, 2024.
Bank National Association, as Joint Lead Arrangers and Book Managers (previously filed as Exhibit 10.1 to the Predecessor's Current Report on Form 8-K, filed on May 6, 2020 and incorporated herein by reference) ‡ 10.22 Form of Restricted Share Award Agreement for awards made under Federal Realty Investment Trust's Long-Term Incentive Award Program and the Trust's Annual Incentive Bonus Program and basic awards with annual vesting for shares issued out the 2020 Plan (previously filed as Exhibit 10.32 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021 and incorporated herein by reference) 10.23 Form of Option Award Agreement for awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2020 Plan (previously filed as Exhibit 10.33 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021, and incorporated herein by reference) 10.24 Form of Restricted Share Award Agreement for long-term vesting and retention awards made under Federal Realty Investment Trust’s Long-Term Incentive Award Program for shares issued out of the 2020 Plan (previously filed as Exhibit 10.34 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021, and incorporated herein by reference) 10.25 Form of Performance Share Award Agreement for shares awarded out of the 2020 Plan (previously filed as Exhibit 10.35 to the Predecessor's Annual Report on From 10-K, filed on February 11, 2021, and incorporated herein by reference) 10.26 Form of Option Award Agreement for basic options awarded out of the 2020 Plan (previously filed as Exhibit 10.36 to the Predecessor's Annual Report on Form 10-K, filed on February 11, 2021, and incorporated herein by reference) 10.27 Form of Performance Award Agreement for Jeffrey S.
Berkes, dated February 10, 2021 (previously filed as Exhibit 10.1 to the Predecessor’s Current Report on Form 8-K, filed on February 12, 2021, and incorporated herein by reference) 10.28 Amended and Restated Severance Agreement between Federal Realty Investment Trust and Jeffery S.
Berkes, dated February 10, 2021 (previously filed as Exhibit 10.2 to the Predecessor's Current Report on Form 8-K, filed on February 12, 2021 and incorporated herein by reference) 10.29 First Amendment to Term Loan Agreement, dated as of April 16, 2021, by and among the Predecessor, as borrower, the Lenders, New Lenders, Departing Lenders (as each such term is defined therein) and PNC Bank, National Association, as Administrative Agent (previously filed as Exhibit 10.1 to the Predecessor's Current Report on From 8-K, filed on April 19, 2021, and incorporated herein by reference) ‡ 10.30 Omnibus Assignment, Assumption and Amendment entered into between the Predecessor and the Parent Company (previously filed as Exhibit 10.1 to our Current Report on Form 8-K, filed on January 3, 2022 and incorporated herein by reference) 10.31 Second Amendment to Term Loan Agreement and Consent, dated as of January 1, 2022, by and among the Predecessor, as borrower, each of the lenders party thereto and PNC Bank, National Association, as administrative agent (previously filed as Exhibit 10.3 to the Trust’s Current Report on Form 8-K filed on January 3, 2022 and incorporated herein by reference) ‡ 10.32 Second Amended and Restated Credit Agreement, dated as of October 5, 2022, by and among the Partnership, as borrower, each of the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent (previously filed as Exhibit 10.1 to the Trust’s Current Report on Form 8-K filed on October 11, 2022 and incorporated herein by reference) 10.33 Third Amendment to Term Loan Agreement, dated as of October 5, 2022, by and among the Partnership, as borrower, each of the lenders party thereto and PNC Bank, National Association, as administrative agent (previously filed as Exhibit 10.2 to the Trust’s Current Report on Form 8-K filed on October 11, 2022 and incorporated herein by reference) 10.34 First Amendment to Second Amended and Restated Credit Agreement, dated as of August 25, 2023, by and among the Partnership, as borrower, each of the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent (previously filed a Exhibit 10.34 to the Trust's Annual Report on Form 10-K, filed on February 12, 2024 and incorporated herein by reference) 10.35 Fourth Amendment to Term Loan Agreement, dated as of August 25, 2023, by and among the Partnership, as borrower, each of the lenders party thereto and PNC Bank, National Association, as administrative agent (previously filed a Exhibit 10.3 5 to the Trust's Annual Report on Form 10-K, filed on February 12, 2024 and incorporated herein by reference) 53 Table of Contents Exhibit No.
Description 10.36 Second Amendment to Second Amended and Restated Credit Agreement, dated as of January 2, 2024, by and among the Partnership, as borrower, each of the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent (previously filed a Exhibit 10.36 to the Trust's Annual Report on Form 10-K, filed on February 12, 2024 and incorporated herein by reference) 10.37 Fifth Amendment to Term Loan Agreement, dated as of January 2, 2024, by and among the Partnership, as borrower, each of the lenders party thereto and PNC Bank, National Association, as administrative agent (previously filed a Exhibit 10.3 7 to the Trust's Annual Report on Form 10-K, filed on February 12, 2024 and incorporated herein by reference) 10.38 Registration Rights Agreement dated January 11, 2024 among the Issuer, the Parent and the Representatives (previously filed as Exhibit 10.1 to the Trust’s Current Report on Form 8-K filed on January 11, 2024 and incorporated herein by reference) 10.39 Third Amendment to Second Amended and Restated Credit Agreement, dated as of March 14, 2024, by and among the Partnership, as borrower, each of the lenders arty thereto and Wells Fargo Bank, National Association, as administrative agent (previously filed as Exhibit 10.1 to the Trust's Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 and incorporated herein by reference) 10.40 ₸ Consulting Agreement between Federal Realty OP LP and Jeffrey S.
Berkes, dated January 1, 2025 ( filed herewith ) 19.1 Policy on Insider Information and Trading in Federal Realty Shares and other Securities (previously filed as Exhibit 19.1 to the Trust's Annual Report on Form 10-K, filed on February 12, 2024 and incorporated here by reference) 21.1 Subsidiaries of Federal Realty Investment Trust and Federal Realty OP LP (filed herewith) 23.1 Consent of Grant Thornton LLP (filed herewith) 31.1 Rule 13a-14(a) Certification of Chief Executive Officer - Federal Realty Investment Trust (filed herewith) 31.2 Rule 13a-14(a) Certification of Chief Financial Officer - Federal Realty Investment Trust (filed herewith) 31.3 Rule 13a-14(a) Certification of Chief Executive Officer - Federal Realty OP LP (filed herewith) 31.4 Rule 13a-14(a) Certification of Chief Financial Officer - Federal Realty OP LP (filed herewith) 32.1 Section 1350 Certification of Chief Executive Officer - Federal Realty Investment Trust (filed herewith) 32.2 Section 1350 Certification of Chief Financial Officer - Federal Realty Investment Trust (filed her
Real Estate Acquisitions Upon acquisition of operating real estate properties, we estimate the fair value of assets and liabilities acquired including land, building, improvements, leasing costs, intangibles such as acquired leases, assumed debt, and current assets and liabilities, if any.
Approximately $21.1 million and $0.4 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $13.3 million of net assets acquired were allocated to other liabilities for "below market leases." On July 31, 2024, we acquired the fee interest in Pinole Vista Crossing, a 216,000 square foot retail shopping center in Pinole, California for $60.0 million.
Approximately $5.7 million of net assets acquired were allocated to other assets for "acquired lease costs," and $4.0 million of net assets acquired were allocated to other liabilities for "below market leases." During the year ended December 31, 2024, we sold our Third Street Promenade property and a portion of our White Marsh Other property for sales prices totaling $106.8 million, resulting in a gain on sale of $53.8 million. 2024 Significant Debt and Equity Transactions On January 11, 2024, our Operating Partnership issued $485.0 million aggregate principal amount of 3.25% Exchangeable Senior Notes due 2029 (the “Notes”) in a private placement.