Certain statements in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in these interim condensed consolidated financial statements for the quarter endedMarch 31, 2022 (the "Quarterly 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, and Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"). These statements include statements aboutInvenTrust 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 stockholders should not rely on forward-looking statements in making investment decisions. There are a number of risks, uncertainties and other important factors, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking statements contained in this Quarterly Report. Such risks, uncertainties and other important factors, include, among others, the risks, uncertainties and factors set forth in our filings with theSecurities and Exchange Commission ("SEC"), including our Annual Report on Form 10-K for the year endedDecember 31, 2021 (the "Annual Report"), and as updated in this Quarterly Report and other quarterly and current reports, which are on file with theSEC and are available at theSEC's website (www.sec.gov). Such risks and uncertainties are related to, among others, the following:
•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 financing on attractive terms;
•future increases in interest rates;
•inflation;
•our status as a real estate investment trust ("REIT") for federal tax purposes; and
•changes in federal, state or local tax law, including legislative, administrative, regulatory or other actions affecting REITs.
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. 15 -------------------------------------------------------------------------------- The following discussion and analysis relates to the three months endedMarch 31, 2022 and 2021 and as ofMarch 31, 2022 andDecember 31, 2021 . It should be read in conjunction with our condensed consolidated financial statements and the related notes included in this Quarterly Report. All square feet and dollar amounts are stated in thousands, except per share amounts and per square foot metrics, unless otherwise noted.
Overview
Strategy and Outlook
InvenTrust Properties Corp. is a premierSun 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 in 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 essential retail centers which will position us to capitalize on potential future rent increases while benefiting from sustained occupancy at our centers. Our strategically located regional field offices are within a two-hour drive of 90% 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 ourSun Belt portfolio of high quality grocery-anchored assets is a distinct differentiator for us in the marketplace. We pursue our business strategy by acquiring retail properties inSun Belt markets, opportunistically disposing of retail properties, maintaining a flexible capital structure, and enhancing environmental, social and governance practices and standards.
Evaluation of Financial Condition
Historically, management has evaluated our financial condition and operating performance by focusing on the following financial and nonfinancial 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
•Core FFO Applicable to
•Cash flow from operations as determined in accordance with GAAP;
•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.
Recent Developments
Acquisitions and Line of Credit Draw Down
OnFebruary 2, 2022 , we acquired two properties inAustin, Texas for$189.3 million ,Escarpment Village , approximately 170 thousand square feet and anchored by H.E.B., and Shops at Arbor Trails, approximately 357 thousand square feet and anchored by Costco andWhole Foods . We funded the acquisitions with cash on hand, drawing down$105.0 million on our line of credit, and by assuming mortgage debt on Shops at Arbor Trails andEscarpment Village of$31.5 million and$26.0 million , respectively.
Dispositions
OnMarch 3, 2022 ,IAGM Retail Fund I, LLC ("IAGM"), our joint venture partnership withPGGM Private Real Estate Fund ("PGGM"), disposed ofPrice Plaza , a 206 thousand square foot retail property located inKaty, Texas , for a gross disposition price of$39.1 million and recognized a gain on sale of$3.8 million . Our share of IAGM's gain on sale was$2.1 million . The property's buyer assumed a$17.8 million mortgage payable at the property. 16 --------------------------------------------------------------------------------
Share Repurchase Program
OnFebruary 23, 2022 , we established a new 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. The SRP replaced our prior share repurchase program (the "Prior SRP"), which the Board previously suspended effectiveSeptember 5, 2021 . As ofMarch 31, 2022 , we have not repurchased any common stock under the SRP.
Debt
OnMarch 4, 2022 , we paid off a$22.3 million mortgage payable at Pavilion at La Quinta using cash on hand and recognized a loss on debt extinguishment of$0.1 million . ATM Program OnMarch 7, 2022 , we established an at-the-market equity offering program (the "ATM Program") through which we may sell from time to time up to an aggregate of$250.0 million of our common stock. In connection with the ATM Program, we may sell shares of our common stock to or through sales agents, or we may enter into separate forward sale agreements with one of the agents, or one of their respective affiliates, as a forward purchaser. When we enter into a forward sale agreement, we expect that the forward purchaser will attempt to borrow from third parties and sell, through a forward seller, shares of our common stock to hedge the forward purchaser's exposure under the forward sale agreement. As ofMarch 31, 2022 , we have not sold any common stock under the ATM Program.
Reduction of Authorized Shares
OnApril 28, 2022 , we filed an amendment to our charter to decrease the number of authorized shares of common stock from 1,460,000,000 to 146,000,000, in proportion with the one-for-ten reverse stock split effected by the Company onAugust 5, 2021 . The authorized shares of preferred stock remain at 40,000,000. The authorized shares of common stock have been retroactively adjusted within the accompanying condensed consolidated financial statements to give effect to the reduction as ofMarch 31, 2022 .
Our Retail Portfolio
Our wholly-owned and managed retail properties include grocery-anchored community and neighborhood centers and power centers, including those classified as necessity-based, as defined in our Annual Report. As ofMarch 31, 2022 , we owned or had an interest in 63 retail properties with a total gross leasable area ("GLA") of approximately 10.6 million square feet, which includes 6 retail properties with a GLA of approximately 1.6 million square feet owned through our 55% ownership interest in an unconsolidated joint venture, IAGM. Where appropriate, we have included results from the IAGM properties at 55% ("at share") when combined with our wholly-owned properties, defined as "Pro Rata Combined Retail Portfolio". The following table summarizes our retail portfolio as ofMarch 31, 2022 and 2021. Wholly-Owned IAGM Pro Rata Combined Retail Properties Retail Properties Retail Portfolio 2022 2021 2022 2021 2022 2021 No. of properties 57 55 6 10 63 65 GLA (square feet) 9,081 8,394 1,562 2,470 9,940 9,752 Economic occupancy (a) 93.9% 92.1% 86.5% 83.2% 93.2% 90.9% Leased occupancy (b) 95.1% 94.1% 87.3% 85.3% 94.4% 92.9% ABR PSF (c)$18.76 $18.40 $17.23 $17.13 $18.64 $18.24 (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 represent leases of less than one year in duration for small shop space and include any term length for common area space.
(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 period multiplied by twelve months. Base rent is inclusive of ground rent and any abatement concessions, but excludes 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. 17 --------------------------------------------------------------------------------
Retail Portfolio Summary by Center Type
The following tables summarize our retail portfolio, by center type, as defined
in our Annual Report, as of
Community and neighborhood centers
Wholly-Owned IAGM Pro Rata Combined Retail Properties Retail Properties Retail Portfolio 2022 2021 2022 2021 2022 2021 No. of properties 45 44 5 5 50 49 GLA (square feet) 5,508 5,051 1,387 1,386 6,271 5,813 Economic occupancy 94.4% 93.1% 85.9% 87.2% 93.4% 92.3% Leased occupancy 95.7% 94.9% 86.9% 88.0% 94.6% 94.0% ABR PSF$19.80 $19.44 $17.11 $16.68 $19.50 $19.10 Power centers Wholly-Owned IAGM Pro Rata Combined Retail Properties Retail Properties Retail Portfolio 2022 2021 2022 2021 2022 2021 No. of properties 12 11 1 5 13 16 GLA (square feet) 3,573 3,343
175 1,084 3,669 3,939 Economic occupancy 93.1% 90.7% 90.8% 78.0% 93.0% 88.8% Leased occupancy 94.4% 93.0% 90.8% 81.8% 94.0% 91.3% ABR PSF$17.15 $16.81 $18.13 $17.75 $17.18 $16.93
Same Property Retail Portfolio Summary
The following tables summarize the GLA, economic occupancy and ABR PSF of the properties included in our retail portfolio classified as same property for the three months endedMarch 31, 2022 and 2021. Same Property Retail Portfolio summaries include results from properties owned for the entirety of both periods presented. Three months endedMarch 31 Wholly-Owned IAGM Pro Rata Combined Retail Properties Retail Properties Retail Portfolio 2022 2021 2022 2021 2022 2021 No. of properties 54 54 6 6 60 60 GLA (square feet) 8,321 8,256 1,562 1,562 9,180 9,115 Economic occupancy 93.9% 92.0% 86.5% 85.5% 93.2% 91.4% Leased occupancy 95.0% 94.0% 87.3% 86.5% 94.3% 93.3% ABR PSF$18.94 $18.59 $17.23 $16.85 $18.79 $18.44 18
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Lease Expirations
The following table presents the lease expirations of our economic occupied Pro
Rata Combined Retail Portfolio as of
No. of GLA of Percent of ABR of Lease Expiring Expiring Leases Total GLA of Expiring Percent of Expiring Expiration Year Leases (a) (square feet) Expiring Leases Leases Total ABR ABR PSF 2022 101 310 3.3%$ 6,418 3.5%$ 20.70 2023 204 1,041 11.2% 19,253 10.5% 18.49 2024 201 1,032 11.1% 21,177 11.6% 20.52 2025 185 1,166 12.6% 21,085 11.5% 18.08 2026 204 877 9.5% 20,372 11.1% 23.23 2027 188 1,723 18.6% 33,465 18.3% 19.42 2028 87 461 5.0% 10,590 5.8% 22.97 2029 91 530 5.7% 11,473 6.3% 21.65 2030 68 339 3.7% 8,632 4.7% 25.46 2031 76 491 5.3% 10,442 5.7% 21.27 Thereafter 72 1,249 13.5% 19,307 10.5% 15.46 Other (b) 13 42 0.5% 965 0.5% 22.98 1,490 9,261 100%$ 183,179 100%$ 19.78
(a)No. of expiring leases includes IAGM at 100%.
(b)Other lease expirations include the GLA, ABR and ABR PSF of month-to-month leases.
In preparing the above table, we have not assumed that unexercised contractual lease renewal or extension options contained in our leases will, in fact, be exercised. Our retail business is neither highly dependent on specific retailers nor subject to lease roll-over concentration. We believe this minimizes risk to our retail portfolio from significant revenue variances over time. 19 --------------------------------------------------------------------------------
Leasing Activity, Pro Rata Combined Retail Portfolio
The following table summarizes the leasing activity for leases that were executed during the three months endedMarch 31, 2022 , compared with expiring or expired leases for the same or previous tenant for renewals and the same unit for new leases at the 63 properties in our Pro Rata Combined Retail Portfolio. Except for number of leases, all figures reflect results from our wholly owned and IAGM properties at share. These tables do not include rent deferral lease amendments executed as a result of the impact of the COVID-19 pandemic.
In our Pro Rata Combined Retail Portfolio, we had GLA totaling 1.04 million
square feet expiring during the three months ended
No. of Leases New Prior % Change Executed for the Contractual Contractual over Prior Weighted Average Tenant Improvement Three Months Ended GLA SF Rent Rent Lease Lease Term Allowance LeaseMarch 31, 2022 (in thousands) ($PSF) (b) ($PSF) (b) Rent (b) (Years) ($PSF) Commissions ($PSF) All Tenants Comparable Renewal Leases (a) 46 114$27.72 $26.56 4.4% 4.1$0.98 $- Comparable New Leases (a) 1 11$15.50 $13.00 19.2% 11.0$45.00 $9.86 Non-Comparable Renewal and New Leases 21 58$30.80 N/A N/A 10.0$42.07 $11.80 Total 68 183$26.69 $25.41 5.0% 6.4$16.52 $4.30 Anchor Tenants (leases ten thousand square feet and over) Comparable Renewal Leases (a) 3 36$18.08 $17.28 4.6% 2.5$1.38 $- Comparable New Leases (a) 1 11$15.50 $13.00 19.2% 11.0$45.00 $9.86 Non-Comparable Renewal and New Leases - - $- $- N/A - $- $- Total 4 47$17.50 $16.31 7.3% 4.4$11.22 $2.22 Small Shop Tenants (leases under ten thousand square feet) Comparable Renewal Leases (a) 43 78$32.19 $30.85 4.3% 4.9$0.79 $- Comparable New Leases (a) - - $- $- -% - $- $- Non-Comparable Renewal and New Leases 21 58$30.80 N/A N/A 10.0$42.07 $11.80 Total 64 136$32.19 $30.85 4.3% 7.1$18.34 $5.02 (a)Comparable leases are leases that meet all of the following criteria: terms greater than or equal to one year, unit was vacant less than one year prior to executed lease, square footage of unit remains unchanged or within 10% of prior unit square footage, and has a rent structure consistent with the previous tenant.
(b)Non-comparable leases are not included in totals.
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Results of Operations
Comparison of results for the three months ended
We generate substantially all of our earnings from property operations. SinceJanuary 1, 2021 , we have acquired three retail properties and disposed of one retail property.
The following table presents the changes in our income for the three months
ended
Three months ended March 31, 2022 2021 Increase (Decrease) Income Lease income, net$ 57,768 $ 49,926 $ 7,842 Other property income 264 182 82 Other fee income 754 1,013 (259) Total income$ 58,786 $ 51,121 $ 7,665 Lease income, net, for the three months endedMarch 31, 2022 , increased by$7.8 million when compared to the same period in 2021, primarily as a result of increased minimum rent of$4.4 million , net changes in credit losses and related reversals of$1.3 million , increased recovery income of$0.7 million , increased percentage rent of$0.1 million , and net increased GAAP rent adjustments of$1.3 million .
The following table presents the changes in our operating expenses for the three
months ended
Three months ended March 31, 2022 2021 Increase (Decrease) Operating expenses Depreciation and amortization$ 22,829 $ 21,687 $ 1,142 Property operating 8,285 8,009 276 Real estate taxes 8,043 8,133 (90) General and administrative 7,887 10,351 (2,464) Total operating expenses$ 47,044 $ 48,180 $ (1,136) Depreciation and amortization expenses for the three months endedMarch 31, 2022 , increased$1.1 million when compared to the same period in 2021, primarily as a result of the acquisition of three retail properties sinceJanuary 1, 2021 generating increased depreciation and amortization expense of$2.0 million , which was partially offset by$0.9 million of reduced depreciation and amortization expense pertaining to the demolition of a building at one retail property in 2021. General and administrative expenses for the three months endedMarch 31, 2022 , decreased$2.5 million when compared to the same period in 2021, primarily as a result of decreased long-term incentive plan costs of$1.4 million , decreased stock administration and investor relations costs of$0.7 million , and net decreases in all other costs of$0.4 million .
The following table presents the changes in our other income and expenses.
Three
months ended
2022 2021 Change, net Other (expense) income Interest expense, net$ (4,809) $ (3,985) $ (824) Loss on extinguishment of debt (96) - (96) Gain on sale of investment properties, net - 519 (519) Equity in earnings of unconsolidated entities 2,716 620 2,096 Other income and expense, net (52) (195) 143 Total other (expense) income, net$ (2,241) $ (3,041) $ 800 Interest expense, net
Interest expense, net, for the three months ended
•fluctuations in our line of credit balances and 1-month LIBOR interest rates on our corporate credit facilities generating increased interest expense of$0.3 million , 21 -------------------------------------------------------------------------------- •assumption of mortgages on Shops at Arbor Trails andEscarpment Village of$31.5 million and$26.0 million , respectively, generating increased interest expense of$0.3 million ,
•increased amortization of debt issuance costs of
•paying off a$22.3 million mortgage payable on one retail property, decreasing interest expense by$0.1 million and generating a loss on debt extinguishment of$0.1 million .
Gain on sale of investment properties, net
During the three months ended
Equity in earnings of unconsolidated entities
Equity in earnings of unconsolidated entities for the three months endedMarch 31, 2022 , increased$2.1 million when compared to the same period in 2021, primarily as a result of a gain on sale of a property of$2.1 million and decreased interest expense of$0.3 million , which were partially offset by decreased earnings from property operations of$0.3 million . The aforementioned amounts represent our proportionate share of the activity.
Net Operating Income
We evaluate the performance of our retail properties based on NOI, which excludes general and administrative expenses, depreciation and amortization, provision for asset impairment, other income and expense, net, 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 straight-line rent, above/below market lease amortization and amortization of lease incentives). We bifurcate NOI into Same Property NOI and NOI from other investment properties based on whether the underlying retail properties meet our same property criteria. We believe the supplemental non-GAAP financial measures of NOI, same property NOI, and NOI from other investment properties provide added comparability across periods when evaluating our financial condition and operating performance that is not readily apparent from "Operating income" or "Net income" in accordance with GAAP.
Comparison of Same Property results for the three months ended
A total of 54 wholly-owned retail properties and 60 Pro Rata retail properties met our Same Property criteria for the three months endedMarch 31, 2022 and 2021. The following table presents the reconciliation of net income (loss), the most directly comparable GAAP measure, to NOI, Same Property NOI, and Pro Rata Same Property NOI for the three months endedMarch 31, 2022 and 2021: Three months ended March 31, 2022 2021 Net income (loss) $ 9,501$ (100) Adjustments to reconcile to non-GAAP metrics: Other income and expense, net 52 195 Equity in earnings of unconsolidated entities (2,716) (620) Interest expense, net 4,809 3,985 Loss on extinguishment of debt 96 - Gain on sale of investment properties, net - (519) Depreciation and amortization 22,829 21,687 General and administrative 7,887 10,351 Other fee income (754) (1,013) Adjustments to NOI (a) (3,872) (1,881) NOI 37,832 32,085 NOI from other investment properties (2,096) (150) Same Property NOI 35,736 31,935 IAGM Same Property NOI at share 3,001 2,596 Pro Rata Same Property NOI $
38,737
(a)Adjustments to NOI include termination fee income and expense and GAAP rent adjustments.
22 -------------------------------------------------------------------------------- Comparison of the components of Same Property NOI for the three months endedMarch 31, 2022 and 2021 Three months ended March 31, 2022 2021 Change Var. Lease income, net$ 50,666 $ 47,894 $ 2,772 5.8 % Other property income 269 187 82 43.9 % 50,935 48,081 2,854 5.9 % Property operating 7,847 8,012 (165) (2.1) % Real estate taxes 7,352 8,134 (782) (9.6) % 15,199 16,146 (947) (5.9) % Same Property NOI$ 35,736 $ 31,935 $ 3,801 11.9 %
Same Property NOI increased by
•increased minimum rent of
•net changes in credit losses and related reversals of
•decreased recoverable expenses of
•decreased non-recoverable expenses of
•increased percentage rent of
•decreased recovery income of
The increase in minimum rent is primarily attributable increased economic and leased occupancy levels when comparing the three months endedMarch 31, 2022 to the same period in 2021. During the three months endedMarch 31, 2022 , we recognized credit losses relating to billed rent and recoveries of$0.2 million and reversals of credit losses of$0.8 million . During the three months endedMarch 31, 2021 , we recognized credit losses relating to billed rent and recoveries of$0.9 million and reversals of credit losses of$0.8 million .
Real estate taxes and recoverable operating expenses, net of associated
recoveries, decreased
Non-recoverable operating expenses relating to tenant lease negotiations
decreased when comparing the three months ended
23 --------------------------------------------------------------------------------
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. 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 use Core FFO as an input to our compensation plan to determine cash bonuses and measure the achievement of certain performance-based equity awards. See our Annual Report on Form 10-K for expanded descriptions of NAREIT FFO and Core FFO. FFO Applicable toCommon Shares and Dilutive Securities and Core FFO Applicable toCommon Shares and Dilutive Securities is calculated as follows: Three months endedMarch 31, 2022 2021 Net income (loss) $
9,501
22,622 21,447 Gain on sale of investment properties, net - (519) Unconsolidated joint venture adjustments (a) (465) 2,070
NAREIT FFO Applicable to
31,658 22,898
Amortization of above and below-market leases and lease inducements, net
(2,547) (1,243) Straight-line rent adjustments, net (1,157) (517) Adjusting items, net (b) 873 819 Unconsolidated joint venture adjusting items, net (c) 194 168
Core FFO Applicable to
Weighted average common shares outstanding - basic 67,354,717 71,998,654 Dilutive effect of unvested restricted shares (d) 221,321 - Weighted average common shares outstanding - diluted 67,576,038 71,998,654
Net income (loss) per common share, basic and diluted $ 0.14 $
-
Per share adjustments - NAREIT FFO Applicable to
0.33 0.32
NAREIT FFO Applicable to
$
0.47
(0.04) (0.01)
Core FFO Applicable to
$
0.43
(a)Represents our share of depreciation, amortization and gain on sale related to investment properties held in IAGM.
(b)Adjusting items, net, are primarily loss on extinguishment of debt, amortization of debt discounts and financing costs, depreciation and amortization of corporate assets, and non-operating income and expenses, net, which includes items which are not pertinent to measuring on-going operating performance, such as miscellaneous and settlement income. (c)Represents our share of amortization of above and below-market leases and lease inducements, net, straight line rent adjustments, net and adjusting items, net related to IAGM. (d)For purposes of calculating non-GAAP per share metrics, the same denominator is used as that which would be used in calculating diluted earnings per share in accordance with GAAP. For the three months endedMarch 31, 2021 , unvested restricted shares were antidilutive and therefore excluded from the denominator in the diluted earnings per share calculation in accordance with GAAP. 24 --------------------------------------------------------------------------------
Liquidity and Capital Resources
Development, Redevelopment, Capital Expenditures and Leasing Activities
The following table summarizes capital resources used through development and redevelopment, capital expenditures, and leasing activities at our retail properties owned during the three months endedMarch 31, 2022 . These costs are classified as cash used in capital expenditures and tenant improvements and investment in development and redevelopment projects on the condensed consolidated statements of cash flows during the three months endedMarch 31, 2022 . Development and Redevelopment Capital Expenditures Leasing Total Direct costs $ 1,986 (a) $ 1,145$ 2,818 (c)$ 5,949 Indirect costs 377 (b) 340 - 717 Total $ 2,363 $ 1,485$ 2,818 $ 6,666
(a)Direct development and redevelopment costs relate to construction of buildings at our retail properties.
(b)Indirect development and redevelopment costs relate to capitalized interest, real estate taxes, insurance, and payroll attributed to improvements at our retail properties.
(c)Direct leasing costs relate to improvements to a tenant space that are either paid directly by or reimbursed to the tenants.
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 of directors (the "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 •To invest in
properties;
investments; •To fund development, redevelopment, •Distributions from our joint venture investment; maintenance and capital expenditures or leasing •Proceeds from sales of properties; incentives; •Proceeds from mortgage loan borrowings on •To make distributions to our stockholders; properties; •To service or pay down our debt; •Proceeds from corporate borrowings; and •To pay our operating expenses; and •Proceeds from any ATM Program activities. •To fund other
general corporate uses.
From time to time, we may seek to acquire additional 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.
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