BEACHWOOD, Ohio, February 27, 2025--(BUSINESS WIRE)--SITE Centers Corp. (NYSE: SITC), an owner of open-air shopping centers located primarily in suburban, high household income communities, announced today operating results for the quarter ended December 31, 2024.
"SITE Centers furthered the Company’s goal of recognizing value for stakeholders in the fourth quarter by continuing the simplification of its capital structure through the redemption of the remaining $175 million of outstanding preferred shares. The Company’s commenced rate increased through new tenant store openings in an environment of strong leasing demand, and we intend to capitalize where we view strong private market interest in purchasing high quality assets by marketing a subset of shopping centers for sale," commented David R. Lukes, President and Chief Executive Officer. "Going forward, SITE Centers intends to maximize value through continued leasing, asset management and potential additional asset sales."
Results for the Fourth Quarter
Fourth quarter net loss attributable to common shareholders was $13.2 million, or $0.25 per diluted share, as compared to net income of $193.6 million, or $3.69 per diluted share, in the year-ago period. The decrease year-over-year primarily was the result of the spin-off of Curbline Properties Corp. ("Curbline" or "Curbline Properties") (NYSE: CURB), lower Net Operating Income ("NOI") as a result of property dispositions, lower gain on sale from dispositions, lower interest income and the write-off of the remaining original issuance costs relating to the 6.375% Class A Cumulative Redeemable Preferred Shares that were redeemed during the quarter.
Fourth quarter operating funds from operations attributable to common shareholders ("Operating FFO" or "OFFO") was $8.3 million, or $0.16 per diluted share, compared to $54.0 million, or $1.03 per diluted share, in the year-ago period. The decrease year-over-year primarily was due to the spin-off of Curbline Properties, lower NOI as a result of property dispositions and lower interest income.
Significant Fourth Quarter Activity and Key Operating Results
On November 20, 2024, redeemed all outstanding 6.375% Class A Cumulative Redeemable Preferred Shares and the associated depositary shares at par. In conjunction with the redemption, a charge of $6.2 million was recorded for the write off of the remaining original issuance costs.
Reported a leased rate of 91.1% at December 31, 2024 as compared to 91.3% at September 30, 2024 and 92.2% at December 31, 2023, all on a pro rata basis. The September 30, 2024 and December 31, 2023 leased rates have been adjusted to reflect the removal of all properties included in the Curbline Properties spin-off and all properties sold during 2024.
Reported a commenced rate of 90.6% at December 31, 2024 as compared to 89.8% at September 30, 2024 and 89.6% at December 31, 2023, all on a pro rata basis. The September 30, 2024 and December 31, 2023 commenced rates have been adjusted to reflect the removal of all properties included in the Curbline Properties spin-off and all properties sold during 2024.
Generated cash renewal leasing spreads of 10.6%, on a pro rata basis, for the fourth quarter of 2024.
Discontinued Operations
On October 1, 2024, the Company completed the spin-off of 79 convenience properties and distributed $800.0 million of cash to Curbline Properties. The spin-off of the convenience properties represented a strategic shift in the Company’s business and, as such, the Curbline properties are reflected as discontinued operations for all periods presented.
About SITE Centers Corp.
SITE Centers is an owner and manager of open-air shopping centers located primarily in suburban, high household income communities. The Company is a self-administered and self-managed REIT operating as a fully integrated real estate company, and is publicly traded on the New York Stock Exchange under the ticker symbol SITC. Additional information about the Company is available at www.sitecenters.com. To be included in the Company’s e-mail distributions for press releases and other investor news, please click here.
Supplemental Information
Copies of the Company's quarterly financial supplement are available on the Investor Relations portion of the Company's website, ir.sitecenters.com.
Non-GAAP Measures and Other Operational Metrics
Funds from Operations ("FFO") is a supplemental non-GAAP financial measure used as a standard in the real estate industry and is a widely accepted measure of real estate investment trust ("REIT") performance. Management believes that both FFO and Operating FFO provide additional indicators of the financial performance of a REIT. The Company also believes that FFO and Operating FFO more appropriately measure the core operations of the Company and provide benchmarks to its peer group.
FFO is generally defined and calculated by the Company as net income(loss) (computed in accordance with generally accepted accounting principles in the United States ("GAAP")), adjusted to exclude (i) preferred share dividends, (ii) gains and losses from disposition of real estate property and related investments, which are presented net of taxes, (iii) impairment charges on real estate property and related investments, (iv) gains and losses from changes in control and (v) certain non-cash items. These non-cash items principally include real property depreciation and amortization of intangibles, equity income (loss) from joint ventures and equity income from non-controlling interests and adding the Company’s proportionate share of FFO from its unconsolidated joint ventures and non-controlling interests, determined on a consistent basis. The Company’s calculation of FFO is consistent with the definition of FFO provided by NAREIT. The Company calculates Operating FFO as FFO excluding certain non-operating charges, income and gains/losses. Operating FFO is useful to investors as the Company removes non-comparable charges, income and gains/losses to analyze the results of its operations and assess performance of the core operating real estate portfolio. Other real estate companies may calculate FFO and Operating FFO in a different manner.
The Company also uses NOI, a non-GAAP financial measure, as a supplemental performance measure. NOI is calculated as property revenues less property-related expenses. The Company believes NOI provides useful information to investors regarding the Company’s financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level and, when compared across periods, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and disposition activity on an unleveraged basis.
FFO, Operating FFO and NOI do not represent cash generated from operating activities in accordance with GAAP, are not necessarily indicative of cash available to fund cash needs and should not be considered as alternatives to net income computed in accordance with GAAP, as indicators of the Company’s operating performance or as alternatives to cash flow as a measure of liquidity. Reconciliations of these non-GAAP measures to their most directly comparable GAAP measures have been provided herein.
Safe Harbor
SITE Centers Corp. considers portions of the information in this press release to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to the Company's expectation for future periods. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not historical fact, including statements regarding the Company's projected operational and financial performance, strategy, prospects and plans, may be deemed to be forward-looking statements. There are a number of important factors that could cause our results to differ materially from those indicated by such forward-looking statements, including, among other factors, general economic conditions, including inflation and interest rate volatility; local conditions such as the supply of, and demand for, retail real estate space in our geographic markets; the consistency with future results of assumptions based on past performance; the impact of e-commerce; dependence on rental income from real property; the loss of, significant downsizing of or bankruptcy of a major tenant and the impact of any such event on rental income from other tenants and our properties; our ability to enter into agreements to sell properties on commercially reasonable terms and to satisfy closing conditions applicable to such sales; our ability to finance our businesses on commercially acceptable terms or at all; impairment charges; valuation and risks relating to our joint venture investments; the termination of any joint venture arrangements or arrangements to manage real property; property damage, expenses related thereto and other business and economic consequences (including the potential loss of rental revenues) resulting from extreme weather conditions or natural disasters in locations where we own properties, and the ability to estimate accurately the amounts thereof; sufficiency and timing of any insurance recovery payments related to damages from extreme weather conditions or natural disasters; any change in strategy; the impact of pandemics and other public health crises; unauthorized access, use, theft or destruction of financial, operations or third party data maintained in our information systems or by third parties on our behalf; our ability to maintain REIT status; and the finalization of the financial statements for the period ended December 31, 2024. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements, please refer to the Company's most recent reports on Forms 10-K and 10-Q. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
SITE Centers Corp.
Income Statement: Consolidated Interests
in thousands, except per share
4Q24
4Q23
12M24
12M23
Revenues:
Rental income (1)
$32,583
$97,435
$269,286
$444,062
Other property revenues
282
251
1,801
1,736
32,865
97,686
271,087
445,798
Expenses:
Operating and maintenance (2)
8,924
19,218
55,372
78,306
Real estate taxes
4,543
13,444
40,292
65,501
13,467
32,662
95,664
143,807
Net operating income (3)
19,398
65,024
175,423
301,991
Other income (expense):
JV and other fee income (4)
2,035
1,510
6,380
6,817
Interest expense
(5,833)
(19,657)
(59,463)
(80,482)
Depreciation and amortization
(13,061)
(38,154)
(101,344)
(180,611)
General and administrative (5)
(8,393)
(14,931)
(47,080)
(50,867)
Other income (expense), net (6)
335
6,522
(16,761)
5,565
Impairment charges
0
0
(66,600)
0
(Loss) income before earnings from discontinued operations, JVs and other
(5,519)
314
(109,445)
2,413
Equity in net income of JVs
(324)
82
82
6,577
Gain on sale and change in control of interests
0
0
2,669
3,749
Gain on disposition of real estate, net
50
187,796
633,219
218,655
Tax expense
(29)
(1,234)
(761)
(2,045)
(Loss) income from continuing operations
(5,822)
186,958
525,764
229,349
Income from discontinued operations (7)
0
9,466
6,060
36,372
Net (loss) income
(5,822)
196,424
531,824
265,721
Non-controlling interests
0
0
0
(18)
Net (loss) income SITE Centers
(5,822)
196,424
531,824
265,703
Write off of preferred share original issuance costs
(6,155)
—
(6,155)
0
Preferred dividends
(1,271)
(2,789)
(9,638)
(11,156)
Net (loss) income Common Shareholders
($13,248)
$193,635
$516,031
$254,547
Weighted average shares – Basic – EPS (8)
52,430
52,331
52,393
52,365
Assumed conversion of diluted securities (7)
—
21
191
40
Weighted average shares – Diluted – EPS (8)
52,430
52,352
52,584
52,405
Basic earnings per share:
From continuing operations
$(0.25)
$3.51
$9.69
$4.16
From discontinued operations
0
0.18
0.12
0.69
Total
$(0.25)
$3.69
$9.81
$4.85
Diluted earnings per share:
From continuing operations
$(0.25)
$3.52
$9.65
$4.16
From discontinued operations
0
0.17
0.12
0.69
Total
$(0.25)
$3.69
$9.77
$4.85
(1)
Rental income:
Minimum rents
$20,826
$65,497
$176,496
$292,449
Ground lease minimum rents
1,310
3,188
7,968
13,773
Straight-line rent, net and amortization of (above)/below-market rent, net
786
1,202
4,446
13,208
Percentage and overage rent
632
1,545
4,651
5,570
Recoveries
8,401
24,408
70,360
113,214
Uncollectible revenue
109
(278)
702
(1,010)
Ancillary and other rental income
519
1,858
3,329
6,300
Lease termination fees
0
15
1,334
558
(2)
Includes allocated general and administrative expense
1,193
2,779
8,046
10,833
(3)
Includes NOI from wholly-owned assets sold in 2024
43
N/A
88,815
N/A
(4)
Curbline Shared Services Agreement ("SSA") fee
593
0
593
0
Curbline SSA gross up
499
0
499
0
Embedded Lease SSA (included in rental income)
(369)
0
(369)
0
(5)
Separation and other charges
361
1,032
1,709
5,046
(6)
Interest income (fees), net
1,775
4,553
31,620
4,348
Transaction costs
(941)
(42)
(1,685)
(836)
Curbline SSA gross up
(499)
0
(499)
0
Debt extinguishment costs
0
(92)
(42,822)
(50)
Gain on debt retirement and gain (loss) on equity derivative instruments
0
2,103
(3,375)
2,103
(7)
Curbline assets classified as a "discontinued operation" for financial reporting purposes on a retrospective basis
(8)
Prior periods presented have been adjusted to reflect the Company's one-for-four reverse stock split
SITE Centers Corp.
Reconciliation: Net Income to FFO and Operating FFO
and Other Financial Information
in thousands, except per share
4Q24
4Q23
12M24
12M23
Net (loss) income attributable to Common Shareholders
($13,248)
$193,635
$516,031
$254,547
Depreciation and amortization of real estate
12,467
36,754
97,186
175,156
Equity in net income of JVs
324
(82)
(82)
(6,577)
JVs' FFO
1,337
1,654
6,040
7,981
Discontinued operations' FFO adjustments (1)
0
8,771
29,556
31,478
Non-controlling interests
0
0
0
18
Impairment of real estate
0
0
66,600
0
Gain on sale and change in control of interests
0
0
(2,669)
(3,749)
Gain on disposition of real estate, net
(50)
(187,796)
(633,219)
(218,655)
FFO attributable to Common Shareholders
$830
$52,936
$79,443
$240,199
Separation and other charges
361
1,308
1,709
5,752
Discontinued operations' transaction and debt extinguishment costs
0
1,323
30,851
2,376
Write-off of preferred share original issuance costs
6,155
0
6,155
0
Transaction, debt extinguishment and other (at SITE's share)
941
515
44,154
1,648
Derivative mark-to-market
0
(2,103)
4,412
(2,103)
Total non-operating items, net
7,457
1,043
87,281
7,673
Operating FFO attributable to Common Shareholders
$8,287
$53,979
$166,724
$247,872
Weighted average shares & units – Basic: FFO & OFFO (2)
52,430
52,331
52,393
52,377
Assumed conversion of dilutive securities (2)
0
21
191
40
Weighted average shares & units – Diluted: FFO & OFFO (2)
52,430
52,352
52,584
52,417
FFO per share – Basic (2)
$0.02
$1.01
$1.52
$4.59
FFO per share – Diluted (2)
$0.02
$1.01
$1.51
$4.58
Operating FFO per share – Basic (2)
$0.16
$1.03
$3.18
$4.73
Operating FFO per share – Diluted (2)
$0.16
$1.03
$3.17
$4.73
Common stock dividends declared, per share (2)
$0.00
$1.16
$1.04
$2.72
Capital expenditures (SITE Centers share) (3):
Redevelopment costs
39
3,148
4,849
14,462
Maintenance capital expenditures
753
4,960
4,937
15,413
Tenant allowances and landlord work
1,897
14,001
25,486
44,892
Leasing commissions
389
1,477
3,634
6,092
Construction administrative costs (capitalized)
320
776
2,973
3,171
Certain non-cash items (SITE Centers share) (3):
Straight-line rent
670
578
3,159
1,621
Straight-line fixed CAM
22
98
178
329
Amortization of below-market rent/(above), net
177
754
1,777
12,057
Straight-line ground rent expense (income)
18
(25)
20
(155)
Debt fair value and loan cost amortization
(908)
(1,261)
(5,398)
(4,741)
Capitalized interest expense
25
322
571
1,238
Stock compensation expense
(327)
(1,965)
(6,285)
(7,083)
Non-real estate depreciation expense
(597)
(1,402)
(4,168)
(5,466)
(1)
Discontinued operations' FFO adjustments
Depreciation and amortization of real estate investments
$0
$8,771
$29,556
$31,849
Loss (gain) on disposition of real estate, net
0
0
0
(371)
$0
$8,771
$29,556
$31,478
(2)
Prior periods presented have been adjusted to reflect the Company's one-for-four reverse stock split
(3)
Excludes amounts from discontinued operations for all periods
