Curbline Properties Corp 10-Q for FY2025 Q3
Curbline Properties Corp. (CURB)
About this 10-Q
Curbline Properties Corp filed this 10-Q on October 29, 2025, covering the quarter ended September 30, 2025 (FY2025 Q3).
Headline figures
Quarter ended September 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $48.65M
- up 63.5% from $29.76M a year earlier
- Net income
- $9.36M
- compared with a net loss of $15.41M a year earlier
- Diluted EPS
- $0.09
- compared with -$0.15 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ___________ to ___________
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Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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.
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Emerging growth company |
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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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of October 22, 2025 the registrant had
EXPLANATORY NOTE
This quarterly report of Curbline Properties Corp. (the “Company” or “Curbline”, “we” or “us”) includes the financial statements of the Company as of September 30, 2025 and December 31, 2024 and for the three and nine months ended September 30, 2025 and 2024.
On October 1, 2024, SITE Centers Corp. (“SITE Centers”) completed the spin-off of Curbline, pursuant to which SITE Centers contributed 79 convenience properties to the Company. The spin-off was effected pursuant to the Separation and Distribution Agreement, dated as of October 1, 2024, among the Company, Curbline Properties LP, a subsidiary of the Company, and SITE Centers, as further described in the Information Statement (as defined below).
The spin-off is more fully described in the information statement included as Exhibit 99.1 to the Company’s Registration Statement on Form 10 (File No. 001-42265) filed with the Securities and Exchange Commission on September 3, 2024 (the “Information Statement”). The spin-off became effective at 12:01 a.m., Eastern Time, on October 1, 2024 (the “Spin-Off Date”). The Company’s common stock trades on the New York Stock Exchange under the symbol “CURB”.
The financial statements prior to the Spin-Off Date do not represent the financial statements of a legal entity, but rather a combination of entities under common control that have been “carved out” of the consolidated financial statements of SITE Centers and presented on a consolidated basis. Therefore, the consolidated financial statements prior to the Spin-Off Date are not necessarily indicative of the Company’s results of operations, cash flows or financial position following the completion of the spin-off. For more information regarding the risks related to our business, refer to the section captioned “1A. Risk Factors” contained in the Company’s Annual Report on Form 10-K.
FORWARD-LOOKING STATEMENTS
The Company considers portions of the information in this quarterly report 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:
2
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 Annual Report on Form 10-K under “Item 1A. Risk Factors” and our subsequent reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
3
Curbline Properties Corp.
QUARTERLY REPORT ON FORM 10-Q
Quarter Ended September 30, 2025
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION |
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Item 1. |
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Financial Statements – Unaudited |
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Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024 |
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5 |
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Consolidated Statements of Operations for the Three Months Ended September 30, 2025 and 2024 |
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Consolidated Statements of Operations for the Nine Months Ended September 30, 2025 and 2024 |
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8 |
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Consolidated Statements of Equity for the Three and Nine Months Ended September 30, 2025 and 2024 |
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9 |
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Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024 |
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Item 2. |
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Management's Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. |
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36 |
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Item 4. |
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37 |
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PART II. OTHER INFORMATION |
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Item 1. |
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38 |
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Item 1A. |
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38 |
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Item 2. |
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38 |
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Item 3. |
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38 |
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Item 4. |
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38 |
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Item 5. |
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38 |
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Item 6. |
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39 |
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40 |
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4
Curbline Properties Corp.
CONSOLIDATED BALANCE SHEETS
(unaudited; in thousands, except share amounts)
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September 30, 2025 |
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December 31, 2024 |
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Assets |
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Land |
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$ |
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Buildings |
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Fixtures and tenant improvements |
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Less: Accumulated depreciation |
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Construction in progress and land |
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Total real estate assets, net |
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Cash and cash equivalents |
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Accounts receivable, net |
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Amounts receivable from SITE Centers |
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Intangible assets, net |
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Other assets |
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$ |
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$ |
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Liabilities and Equity |
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Indebtedness, net |
$ |
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$ |
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Below-market leases, net |
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Dividends payable |
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Accounts payable and other liabilities |
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Total liabilities |
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Equity |
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Preferred Stock, par value $ |
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Common Stock, par value $ |
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Additional paid-in-capital |
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Accumulated distributions in excess of net income |
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Accumulated other comprehensive income (loss) |
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Total stockholders’ equity |
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Non-controlling interests |
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Total equity |
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$ |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
5
Curbline Properties Corp.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; in thousands)
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Three Months |
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Ended September 30, |
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2025 |
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2024 |
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Revenues from operations: |
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Rental income |
$ |
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$ |
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Other income |
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Rental operation expenses: |
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Operating and maintenance |
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Real estate taxes |
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General and administrative |
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Depreciation and amortization |
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Other income (expense): |
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Interest expense |
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Interest income |
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Other income (expense), net |
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Income (loss) before tax expense |
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Tax expense of taxable REIT subsidiaries and state franchise and income taxes |
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Net income (loss) |
$ |
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$ |
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Income attributable to non-controlling interests |
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Net income (loss) attributable to Curbline |
$ |
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$ |
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Per share data: |
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Basic |
$ |
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$ |
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Diluted |
$ |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
6
Curbline Properties Corp.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; in thousands)
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Nine Months |
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Ended September 30, |
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2025 |
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2024 |
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Revenues from operations: |
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Rental income |
$ |
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$ |
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Other income |
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Rental operation expenses: |
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Operating and maintenance |
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Real estate taxes |
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General and administrative |
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Depreciation and amortization |
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Other income (expense): |
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Interest expense |
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Interest income |
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Other income (expense), net |
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Gain on disposition of real estate, net |
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Income (loss) before tax expense |
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Tax expense of taxable REIT subsidiaries and state franchise and income taxes |
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Net income (loss) |
$ |
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$ |
( |
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Income attributable to non-controlling interests |
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Net income (loss) attributable to Curbline |
$ |
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$ |
( |
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Per share data: |
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Basic |
$ |
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$ |
( |
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Diluted |
$ |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
7
Curbline Properties Corp.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(unaudited; in thousands)
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Three Months |
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Nine Months |
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Ended September 30, |
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Ended September 30, |
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2025 |
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2024 |
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2025 |
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2024 |
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Net income (loss) |
$ |
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$ |
( |
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$ |
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$ |
( |
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Change in cash flow hedges |
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( |
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Comprehensive income (loss) |
$ |
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$ |
( |
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$ |
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$ |
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Comprehensive income attributable to non-controlling interests |
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Net income attributable to non-controlling interests |
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( |
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( |
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Total comprehensive income (loss) attributable to Curbline |
$ |
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$ |
( |
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$ |
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$ |
( |
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The accompanying notes are an integral part of these consolidated financial statements.
8
Curbline Properties Corp.
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited; in thousands)
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Curbline Equity |
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Common Stock Amounts |
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Additional |
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Accumulated Distributions in Excess of |
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Accumulated Other Comprehensive Income (Loss) |
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Total Stockholders’ Equity |
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Non-controlling Interests - Unit Holders in Operating Partnership |
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Total Equity |
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Balance, December 31, 2024 |
$ |
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$ |
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$ |
( |
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$ |
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$ |
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$ |
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$ |
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Issuance of common stock |
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Stock-based awards retained for taxes |
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( |
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( |
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( |
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Stock-based compensation, net |
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Dividend and distributions, |
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( |
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( |
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( |
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( |
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( |
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Rebalancing of non-controlling |
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( |
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Other comprehensive loss |
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( |
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( |
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( |
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( |
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Net income |
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Balance, June 30, 2025 |
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Stock-based awards retained for taxes |
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( |
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( |
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Stock-based compensation, net |
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Dividend and distributions, |
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( |
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( |
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Rebalancing of non-controlling |
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( |
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Other comprehensive loss |
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( |
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( |
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( |
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Net income |
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Balance, September 30, 2025 |
$ |
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$ |
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$ |
( |
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$ |
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$ |
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$ |
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$ |
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Curbline Equity |
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Common Stock Amounts |
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Additional |
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Accumulated Distributions in Excess of |
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Net Parent Investment |
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Accumulated Other Comprehensive Income |
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Total Parent Company Equity |
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Non-controlling Interests - Unit Holders in Operating Partnership |
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Total Equity |
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Balance, December 31, 2023 |
$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Net transactions with SITE |
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Net income |
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Balance, June 30, 2024 |
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Net transactions with SITE |
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Net loss |
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( |
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( |
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( |
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Balance, September 30, 2024 |
$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
9
Curbline Properties Corp.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited; in thousands)
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Nine Months |
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Ended September 30, |
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2025 |
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2024 |
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Cash flow from operating activities: |
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Net income (loss) |
$ |
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$ |
( |
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Adjustments to reconcile net income (loss) to net cash flow provided by operating activities: |
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Depreciation and amortization |
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Amortization and write-off of debt issuance costs |
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Stock-based compensation |
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Assumption of buildings due to ground lease terminations |
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Gain on disposition of real estate |
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Net change in accounts receivable |
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Net change in accounts payable and accrued expenses |
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Net change in other operating assets and liabilities |
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( |
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Total adjustments |
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Net cash flow provided by operating activities |
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Cash flow from investing activities: |
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Real estate acquired, net of liabilities and cash assumed |
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( |
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( |
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Acquisition escrow deposits |
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( |
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Real estate improvements to operating real estate |
|
( |
) |
|
|
( |
) |
Proceeds from disposition of real estate |
|
|
|
|
|
||
Net cash flow used for investing activities |
|
( |
) |
|
|
( |
) |
Cash flow from financing activities: |
|
|
|
|
|
||
Proceeds from term loan |
|
|
|
|
|
||
Proceeds from unsecured notes |
|
|
|
|
|
||
Repayment of mortgage debt |
|
|
|
|
( |
) |
|
Payment of debt issuance costs |
|
( |
) |
|
|
( |
) |
Common stock offering expenses |
|
( |
) |
|
|
|
|
Taxes withheld for vested restricted stock |
|
( |
) |
|
|
|
|
Transactions with SITE Centers |
|
|
|
|
|
||
Dividends paid |
|
( |
) |
|
|
|
|
Net cash flow provided by financing activities |
|
|
|
|
|
||
|
|
|
|
|
|
||
Net (decrease) increase in cash and cash equivalents |
|
( |
) |
|
|
|
|
Cash, cash equivalents and restricted cash, beginning of period |
|
|
|
|
|
||
Cash, cash equivalents and restricted cash, end of period |
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of these consolidated financial statements.
10
Notes to Consolidated Financial Statements
Nature of Business
Curbline Properties Corp., a Maryland corporation, and its consolidated subsidiaries (collectively, the “Company” or “Curbline”) are primarily engaged in the business of owning, leasing, acquiring, and managing convenience shopping centers positioned on the curbline of well-trafficked intersections and major vehicular corridors in suburban, high household income communities. Curbline Properties LP (the “Operating Partnership”) is a Delaware limited partnership formed to serve as Curbline’s majority-owned partnership subsidiary and to own, through affiliates, all of our real estate properties and assets. The Operating Partnership’s capital includes common general and limited partnership interests in the operating partnership (“Common Units”) and LTIP Units, as described in Note 9 (together with the Common Units, the “OP Units”). As of September 30, 2025, Curbline owned, from a legal perspective, approximately
On October 1, 2024 (the “Spin-Off Date”), Curbline, the Operating Partnership and SITE Centers Corp. (“SITE Centers”) entered into a Separation and Distribution Agreement (the “Separation and Distribution Agreement”), pursuant to which, among other things, SITE Centers transferred its portfolio of convenience shopping centers, $
Prior to the Spin-Off
For the three and nine months ended and as of September 30, 2024, the accompanying historical consolidated financial statements and related notes of the Company do not represent the statement of operations and cash flows of a legal entity, but rather a combination of entities under common control that have been “carved out” of SITE Centers’ consolidated financial statements and presented herein, in each case, in accordance with U.S. generally accepted accounting principles (“GAAP”). Intercompany transactions and balances have been eliminated in combination.
The consolidated statements of operations and cash flows for the three and nine months ended September 30, 2024 reflect the revenues and direct expenses of the Company and include material assets and liabilities of SITE Centers that are specifically attributable to the Company. Net parent investment reflected on the consolidated statements of equity prior to the Spin-Off Date represents the excess of total assets over total liabilities. Net parent investment is impacted by contributions from and distributions to SITE Centers, which are the result of treasury activities and net funding provided by or distributed to SITE Centers prior to the Spin-Off, as well as the allocated costs and expenses described below.
Further, the consolidated statements of operations and cash flows for the three and nine months ended September 30, 2024 include an allocation of indirect costs and expenses incurred by SITE Centers related to the Company, primarily consisting of compensation and other general and administrative costs using the relative percentage of GLA of the Company and SITE Centers’ management’s knowledge of the Company. The amounts allocated in the accompanying consolidated financial statements are not necessarily indicative of the actual amount of such indirect expenses that would have been recorded had the Company been a separate independent entity during the applicable periods. The Company believes the assumptions underlying the allocation of indirect expenses are reasonable.
Use of Estimates in Preparation of Financial Statements
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates.
Unaudited Interim Financial Statements
These financial statements have been prepared by the Company in accordance with GAAP for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the results of the
11
periods presented. The results of operations for the three and nine months ended September 30, 2025 and 2024, are not necessarily indicative of the results that may be expected for the full year. These unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
Principles of Consolidation
The consolidated financial statements include the results of the Company, the Operating Partnership and their consolidated subsidiaries. Interests in the Operating Partnership not owned by the Company are referred to as non-controlling interests. These non-controlling interests are held by members of management in the form of LTIP Units issued pursuant to the Company’s 2024 Equity and Incentive Compensation Plan. All significant intercompany balances and transactions have been eliminated in consolidation.
Statements of Cash Flows and Supplemental Disclosure of Non-Cash Investing and Financing Information
Non-cash investing and financing activities are summarized as follows (in millions):
|
Nine Months |
|
|||||
|
Ended September 30, |
|
|||||
|
2025 |
|
|
2024 |
|
||
Accounts payable related to construction in progress |
$ |
|
|
$ |
|
||
Accounts receivable related to construction in progress |
|
|
|
|
|
||
Accounts payable related to future acquisitions |
|
|
|
|
|
||
Accounts payable related to offering expense |
|
|
|
|
|
||
Assumption of buildings due to ground lease terminations |
|
|
|
|
|
||
Dividends declared, but not paid |
|
|
|
|
|
||
Recognition of below market ground lease assets |
|
|
|
|
|
||
Non-Controlling Interests
Non-controlling interests in the Operating Partnership include limited partnership interests in the Operating Partnership in the form of LTIP Unit awards classified as equity. Net income allocated to the non-controlling interests related to the service-based LTIP Units is based on the weighted-average ownership during the period. The Company will adjust the carrying value of the non-controlling interests to reflect its share of the book value of the Operating Partnership when there has been a change in the Company’s ownership of the Operating Partnership. Such adjustments will be recorded to additional paid-in capital as a rebalancing of non-controlling interests on the accompanying consolidated statements of equity.
Segments
Equity
On September 25, 2025, the Board of Directors of the Company authorized a common stock repurchase program. Under the terms of the program, the Company is authorized to repurchase up to a maximum value of $
12
Recently Issued Accounting Standards
Income Taxes. In December 2023, the FASB issued ASU 2023-09 which enhances income tax disclosure requirements in accordance with FASB ASC 740, Income Taxes. The amendments in this update are effective for annual reporting periods beginning after December 15, 2024. The Company will review the extent of the new disclosure necessary prior to implementation. Other than additional disclosure, the adoption of this ASU is not expected to have a material impact on the Company’s financial position and/or result of operations.
Expense Disaggregation Disclosures. In November 2024, the FASB issued ASU 2024-03, which requires additional disaggregated disclosure about certain income statement expense line items. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim periods within the fiscal years beginning after December 15, 2027. Other than additional disclosure, the adoption of this ASU is not expected to have a material impact on the Company’s financial position and/or results of operations.
During the nine months ended September 30, 2025, the Company acquired
|
|
|
|
Weighted-Average |
|
Land |
$ |
|
|
N/A |
|
Buildings |
|
|
|
(A) |
|
Tenant improvements |
|
|
|
(A) |
|
In-place leases (including lease origination costs and fair |
|
|
|
||
Other assets assumed |
|
|
|
N/A |
|
|
|
|
|
|
|
Less: Below-market leases |
|
( |
) |
|
|
Less: Other liabilities assumed |
|
( |
) |
|
N/A |
Net assets acquired |
$ |
|
|
|
|
Total consideration for the acquisitions was paid in cash. Included in the Company’s consolidated statements of operations for the three and nine months ended September 30, 2025, was $
13
Other assets, liabilities and intangibles consist of the following (in thousands):
|
September 30, 2025 |
|
|||||||||
|
Asset |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Intangible assets, net: |
|
|
|
|
|
|
|
|
|||
In-place leases |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Above-market leases |
|
|
|
|
( |
) |
|
|
|
||
Lease origination costs |
|
|
|
|
( |
) |
|
|
|
||
Tenant relationships |
|
|
|
|
( |
) |
|
|
|
||
Below-market leases (as lessee) |
|
|
|
|
( |
) |
|
|
|
||
Total intangible assets, net |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Other assets: |
|
|
|
|
|
|
|
|
|||
Operating lease ROU assets |
|
|
|
|
|
|
$ |
|
|||
Prepaid expenses |
|
|
|
|
|
|
|
|
|||
Other assets(A) |
|
|
|
|
|
|
|
|
|||
Deposits |
|
|
|
|
|
|
|
|
|||
Deferred charges, net |
|
|
|
|
|
|
|
|
|||
Total other assets |
|
|
|
|
|
|
$ |
|
|||
|
Liability |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Below-market leases, net |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
|
December 31, 2024 |
|
|||||||||
|
Asset |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Intangible assets, net: |
|
|
|
|
|
|
|
|
|||
In-place leases |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Above-market leases |
|
|
|
|
( |
) |
|
|
|
||
Lease origination costs |
|
|
|
|
( |
) |
|
|
|
||
Tenant relationships |
|
|
|
|
( |
) |
|
|
|
||
Below-market leases (as lessee) |
|
|
|
|
( |
) |
|
|
|
||
Total intangible assets, net |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Other assets: |
|
|
|
|
|
|
|
|
|||
Prepaid expenses |
|
|
|
|
|
|
$ |
|
|||
Other assets(A) |
|
|
|
|
|
|
|
|
|||
Deposits |
|
|
|
|
|
|
|
|
|||
Swap receivable |
|
|
|
|
|
|
|
|
|||
Deferred charges, net(B) |
|
|
|
|
|
|
|
|
|||
Total other assets |
|
|
|
|
|
|
$ |
|
|||
|
Liability |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Below-market leases, net |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
14
Amortization for the three and nine months ended September 30, 2025 and 2024 related to the Company’s intangibles, excluding Below-market leases (as lessee), was as follows (in thousands):
Year |
|
Income |
|
|
Expense |
|
||
Three months ended September 30, 2025 |
|
$ |
|
|
$ |
|
||
Three months ended September 30, 2024 |
|
|
|
|
|
|
||
Nine months ended September 30, 2025 |
|
|
|
|
|
|
||
Nine months ended September 30, 2024 |
|
|
|
|
|
|
||
The disaggregation of the Company’s lease income, which is included in rental income on the Company’s consolidated statements of operations, as either fixed or variable lease income, for the three and nine months ended September 30, 2025 and 2024, was as follows (in thousands):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Rental income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed lease income(A) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Variable lease income(B) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Above-market and below-market leases amortization, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Uncollectible revenue |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total rental income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
$150.0 Million 2025 Term Loan
On July 15, 2025, the Company and the Operating Partnership entered into a term loan agreement with a syndicate of lenders and PNC, National Association, as administrative agent (the “2025 Term Loan Agreement”), which provides for an unsecured, term loan in the amount of $
The 2025 Term Loan bears interest at variable rates at the Operating Partnership’s election, based on either (i) the term or daily simple SOFR rate plus an applicable margin or (ii) the alternative base rate plus an applicable margin. The applicable margin under the 2025 Term Loan varies based on the rating assigned by S&P Global Ratings, Moody’s Investors Service, Inc. or Fitch Investor Services Inc. to the senior unsecured long-term indebtedness of the Company or the Operating Partnership. In May 2025, the Company entered into a $
The 2025 Term Loan may be prepaid at any time without premium or penalty, subject to customary breakage costs in the case of borrowings with respect to which a SOFR-based rate election is in effect.
The 2025 Term Loan Agreement contains certain customary covenants including, among other things, leverage ratios and debt service coverage and fixed-charge coverage ratios, as well as limitations on the Company’s ability to sell all or substantially all of the Company’s assets and engage in certain mergers and acquisitions. The 2025 Term Loan Agreement also contains customary default provisions including, among other things, the failure to make timely payments of principal and interest payable thereunder and the failure of the Company or its subsidiaries to pay, when due, certain indebtedness in excess of certain thresholds beyond applicable grace and cure periods. The Company was in compliance with these financial covenants at September 30, 2025.
15
$150.0 Million Private Placement of Unsecured Notes
On June 26, 2025, the Company and the Operating Partnership entered into a Note and Guaranty Agreement (the “Note and Guaranty Agreement”) in connection with a private placement of $
The 2025 Notes bear interest on the outstanding principal balance at the stated rates per annum from the date of issuance, payable semi-annually in arrears on March 3 and September 3 of each year, until such principal becomes due and payable. The entire unpaid principal balance of each 2025 Note shall be due and payable on the maturity date thereof. The 2025 Notes are senior unsecured obligations of the Operating Partnership and rank equal in right of payment with all other senior unsecured indebtedness of the Operating Partnership. The 2025 Notes are unconditionally guaranteed by the Company.
The Operating Partnership is permitted to prepay the outstanding 2025 Notes in whole or in part, in an amount not less than
The Note and Guaranty Agreement contains certain customary covenants including, among other things, a maximum total leverage ratio, a maximum secured leverage ratio, a maximum unencumbered leverage ratio, a minimum fixed charge coverage ratio and a minimum unsecured interest coverage ratio. The Company was in compliance with these financial covenants at September 30, 2025.
In connection with the Note and Guaranty Agreement, the Company executed a treasury lock hedge transaction in June 2025 to hedge the treasury yield component of the overall rate ultimately assigned to the $
Revolving Credit Facility and 2024 Term Loan
In connection with the Spin-Off on October 1, 2024, the Company and the Operating Partnership entered into a credit agreement with a syndicate of lenders and Wells Fargo Bank, National Association, as administrative agent (the “2024 Credit Agreement”). The 2024 Credit Agreement provides for (i) an unsecured revolving credit facility in the amount of $
Borrowings under the Revolving Credit Facility bear interest at variable rates at the Operating Partnership’s election, based on either (i) the term or daily simple SOFR rate plus a credit spread adjustment plus an applicable margin, or (ii) the alternative base rate plus an applicable margin. The Revolving Credit Facility also provides for a facility fee, paid on a quarterly basis. Each of the applicable margin and the facility fee under the Revolving Credit Facility varies based on whether the Company has obtained a long-term senior unsecured debt rating of at least BBB (or the equivalent) from S&P Global Ratings or Fitch Investor Services Inc. or a long-term unsecured debt rating of Baa3 (or the equivalent) from Moody’s Investors Service, Inc. (each, an “IG Rating”). Prior to obtaining an IG Rating, each of the applicable margin and facility fee was based on the Company’s ratio of consolidated outstanding indebtedness to consolidated market value and after obtaining an IG Rating, the applicable margin and facility fee is based on the Company’s IG Rating. In May 2025, the Fitch Ratings assigned the Company a Long-Term Issuer Default Rating of BBB.
16
The 2024 Credit Agreement contains certain customary covenants including, among other things, leverage ratios and debt service coverage and fixed-charge coverage ratios, as well as limitations on the Company’s ability to sell all or substantially all of the Company’s assets and engage in certain mergers and acquisitions. The 2024 Credit Agreement also contains customary default provisions including, among other things, the failure to make timely payments of principal and interest payable thereunder and the failure of the Company or its subsidiaries to pay, when due, certain indebtedness in excess of certain thresholds beyond applicable grace and cure periods. The Company was in compliance with these financial covenants at September 30, 2025.
In October 2024, the Company entered into a $
As of December 31, 2024,
|
|
Carrying Value |
|
Interest Rate |
Maturity Date |
|
2024 Term Loan |
|
$ |
|
|||
2025 Notes |
|
|
|
— |
||
2025 Term Loan |
|
|
|
|||
Less: Unamortized debt issuance costs |
|
|
( |
) |
|
|
Total indebtedness |
|
$ |
|
|
|
|
The following methods and assumptions were used by the Company in estimating fair value disclosures of financial instruments:
Cash and Cash Equivalents, Restricted Cash, Accounts Receivable and Accounts Payable and Other Liabilities
The carrying amounts reported in the Company’s consolidated balance sheets for these financial instruments approximated fair value because of their short-term maturities.
Indebtedness
The fair market value of debt is estimated using a discounted cash flow technique that incorporates future contractual interest and principal payments and a market interest yield curve with adjustments for duration, optionality and risk profile, including the Company’s non-performance risk and loan to value, and is classified as Level 3 in the fair value hierarchy.
Considerable judgment is necessary to develop estimated fair values of financial instruments. Accordingly, the estimates presented are not necessarily indicative of the amounts the Company could realize on disposition of the financial instruments. At September 30, 2025, the carrying amount of indebtedness was $
Items Measured on Fair Value on a Recurring Basis - Derivatives
The Company has pay-fixed interest rate swaps to manage some of its exposure to future changes in benchmark-interest rates (the “Swaps”). The estimated fair value was determined using the market standard methodology of netting the discounted fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of interest rates (forward curves) derived from observable market interest rate curves. In addition, credit valuation adjustments, which consider the
17
impact of any credit enhancements to the contract, are incorporated in the fair value to account for potential non-performance risk, including the Company’s own non-performance risk and the respective counterparty’s non-performance risk. The Company determined that the significant inputs used to value its derivative fell within Level 2 of the fair value hierarchy. The Swaps (included in Accounts payable and other liabilities) are measured at fair value on a recurring basis. As of September 30, 2025, the fair value of the Swaps was a liability of $
Risk Management Objective of Using Derivatives
The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity and credit risk, primarily by managing the amount, sources and duration of its debt funding and, from time to time, through the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the values of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s borrowings.
Cash Flow Hedges of Interest Rate Risk
The Company’s objectives in using interest rate derivatives are to manage its exposure to interest rate movements. To accomplish this objective, the Company generally uses swaps, caps and treasury locks as part of its interest rate risk management strategy. The 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 agreements without exchange of the underlying notional amount.
As of September 30, 2025 and December 31, 2024, the Company had an effective swap with a notional amount of $
In connection with an anticipated private notes offering, in September 2025, the Company entered into interest rate lock agreements to fix the treasury component of the Company’s anticipated $
The effective portion of changes in the fair value of derivatives designated, and that qualify, as cash flow hedges are recorded in Accumulated OCI and are subsequently reclassified into interest expense, in the period that the hedged forecasted transaction affects earnings. All components of the Swaps were included in the assessment of hedge effectiveness. The Company expects to reflect, within the next 12 months, an increase to interest expense (and a corresponding decrease to earnings) of approximately $
The Company is exposed to credit risk in the event of non-performance by the counterparty to the swap if the derivative position has a positive balance. The Company believes it mitigates its credit risk by entering into swaps with major financial institutions. The Company continually monitors and actively manages interest costs on its variable-rate debt portfolio and may enter into additional interest rate swap positions or other derivative interest rate instruments based on market conditions. The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes.
Credit Risk-Related Contingent Features
The Company has an agreement with the swap counterparties that contains a provision whereby if the Company defaults on certain of its indebtedness, the Company could also be declared in default on the swap, resulting in an acceleration of payment under the swap.
18
Legal Matters
The Company and its subsidiaries are subject to various legal proceedings, which, taken together, are not expected to have a material adverse effect on the Company. The Company is also subject to a variety of legal actions for personal injury or property damage arising in the ordinary course of its business, most of which are covered by insurance. While the resolution of all matters cannot be predicted with certainty, management believes that the final outcome of such legal proceedings and claims will not have a material adverse effect on the Company’s liquidity, financial position or results of operations.
Commitments and Guarantees
The Company routinely enters into contracts for the maintenance of its properties. These contracts typically can be canceled upon 30 to 60 days’ notice without penalty. At September 30, 2025, the Company had purchase order obligations, typically payable within one year, aggregating approximately $
The changes in Accumulated OCI by component are as follows (in thousands):
|
Gains and Losses |
|
|
Balance, December 31, 2024 |
$ |
|
|
Change in fair value of cash flow hedges |
|
( |
) |
Comprehensive income attributable to non-controlling interests |
|
|
|
Balance, September 30, 2025(A) |
$ |
( |
) |
Restricted Stock
On February 22, 2025, the Company granted a total of
LTIP Units
LTIP Units represent limited partnership units in the Operating Partnership, an entity through which the Company conducts its business, and are structured to qualify as “profits interests” for federal income tax purposes. Awards of LTIP Units shall be valued by reference to our common stock. When issued, LTIP Units do not have full parity, on a per unit basis, with the Common Units. To the extent they receive sufficient allocations of book gain for tax purposes, the LTIP Units can over time achieve full parity with Common Units, at which time vested LTIP Units will be converted into Common Units on a one-for-one basis. Vested LTIP Units that have not achieved full parity with Common Units may also convert into Common Units on a less than a one-for-one basis based on relative capital accounts. Regular and other non-liquidating distributions will be made by the Operating Partnership with respect to unvested LTIP Units as provided in the applicable award agreement for such units. Each Common Unit acquired upon conversion of a vested LTIP Unit may be presented, at the election of the holder, for redemption for cash equal to the market price of a share of common stock of the Company, except that the Company may, at its election, acquire each Common Unit so presented for one share of common stock, subject to certain adjustments. Generally, LTIP Units entitle the holder to receive distributions from the Operating Partnership that are equivalent to the dividends and distributions that would be made with respect to the number of shares of common stock underlying such LTIP Units, though receipt of such distributions may be delayed or made contingent on vesting.
On October 15, 2024, the Company’s Chief Executive Officer (the “CEO”) was granted service-based LTIP Units pursuant to his employment agreement with a value of $
19
LTIP Units, which will vest ratably over a
Non-Cash Compensation Expense
The amounts recorded in general and administrative expenses in the Company’s consolidated statements of operations for the amortization of all of the outstanding stock-based awards and LTIP Units for the three and nine month periods ended September 30, 2025, consisted of the following (in thousands):
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||
Non-Cash Compensation Expense |
|
September 30, 2025 |
|
|
September 30, 2025 |
|
||
Restricted stock units (“RSUs”) |
|
$ |
|
|
$ |
|
||
Restricted stock awards (“RSAs”) |
|
|
|
|
|
|
||
Service-based LTIP Units |
|
|
|
|
|
|
||
Performance-Based Restricted Stock Awards (“PRSAs”) |
|
|
|
|
|
|
||
Performance-Based LTIP Units (“PB LTIPs”) |
|
|
|
|
|
|
||
Total non-cash compensation expense |
|
$ |
|
|
$ |
|
||
The Company declared quarterly cash dividends of $
The following table provides a reconciliation of net income (loss) and the number of shares of common stock used in the computations of “basic” earnings per share (“EPS”), which utilizes the weighted-average number of shares of common stock outstanding without regard to potentially dilutive shares of common stock, and “diluted” EPS, which includes all such shares (in thousands, except per share amounts).
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
||||||||||
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Numerators – Basic and Diluted |
|
|
|
|
|
|
|
|
|
|
|
||||
Net income (loss) |
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
Income (loss) attributable to non-controlling interests |
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Earnings attributable to unvested shares |
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Net income (loss) attributable to common stockholders after |
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
|
|
|
|
|
|
|
|
|
|
|
|
||||
Denominators – Number of Shares |
|
|
|
|
|
|
|
|
|
|
|
||||
Basic – Average shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
||||
Assumed conversion of dilutive securities - PRSAs and PB LTIPs |
|
|
|
N/A |
|
|
|
|
|
N/A |
|
||||
Diluted – Average shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings Per Share: |
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
Diluted |
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
Basic average shares outstanding do not include RSUs totaling
20
PRSAs and PB LTIPs issued to certain executives were considered dilutive and are included in the computation of diluted EPS for the three and nine month periods ended September 30, 2025.
Following the Spin-Off, Curbline operates as an independent public company. To govern certain ongoing relationships between the Company, the Operating Partnership and SITE Centers after the distribution, and to provide for the allocation among the Company, the Operating Partnership and SITE Centers of SITE Centers’ assets, liabilities and obligations attributable to periods both prior to and following the separation of the Company and the Operating Partnership from SITE Centers, the Company, the Operating Partnership and SITE Centers entered into agreements pursuant to which certain services and rights are provided following the Spin-Off, and the Company, the Operating Partnership and SITE Centers will indemnify each other against certain liabilities arising from their respective businesses. The Separation and Distribution Agreement, as well as the Tax Matters Agreement, the Employee Matters Agreement, the Shared Services Agreement (each as defined below) and other agreements governing ongoing relationships were negotiated between related parties and their terms, including fees and other amounts payable, may not be on the same terms as if they had been negotiated at arm’s length with an unaffiliated third party.
Separation and Distribution Agreement
The Separation and Distribution Agreement contains obligations for SITE Centers to complete certain redevelopment projects at properties that are owned by the Company. At September 30, 2025, the remaining amount, which is recorded in amounts receivable from SITE Centers in the consolidated balance sheets, was $
Shared Services Agreement
The fair value of the services received by the Company, which was in excess of the fee paid and the fair value of the services provided to SITE Centers, is reflected as an additional expense within general and administrative expense and income within other income (expense), net in the consolidated statement of operations which amounted to $
Pursuant to the Shared Services Agreement, Curbline has the right to use SITE Centers’ office space including the location in New York. This arrangement is considered an embedded lease based on the criteria specified in Topic 842. The amount recorded under the Shared Services Agreement is variable and the embedded lease rent expense of $
Lease Agreement
In October 2024, the Company entered into a lease agreement with SITE Centers under the Separation and Distribution Agreement where SITE Centers will lease a portion of a property for one year beginning on April 1, 2025. SITE Centers will pay annual rents of $
Summary
For the three and nine months ended September 30, 2025, the Company expensed $
Through October 29, 2025, the Company acquired
On October 1, 2025, the Company entered into an equity sales agreement for the issuance of up to $
21
On October 23, 2025, the Company and the Operating Partnership priced a private placement offering of $
22
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OPERATIONS
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) provides readers with a perspective from management on the financial condition, results of operations and liquidity of Curbline Properties Corp. and its consolidated subsidiaries (collectively, the “Company” or “Curbline”) and other factors that may affect the Company’s future results. The Company believes it is important to read the MD&A in conjunction with the Company’s consolidated financial statements and the notes thereto appearing elsewhere in this report as well as its Annual Report on Form 10-K for the year ended December 31, 2024 and other publicly available information. In addition, the following discussion contains forward-looking statements, such as statements regarding our expectations for future performance, liquidity, and capital resources, that involve risks, uncertainties, and assumptions that could cause actual results to differ materially from our expectations. Our actual results may differ materially from those contained in or implied by any forward-looking statements as a result of various factors, including those set forth under “Forward-Looking Statements” above.
EXECUTIVE SUMMARY
Curbline Properties Corp. is a Maryland corporation formed to own and manage a portfolio of convenience shopping centers. The Operating Partnership is a Delaware limited partnership formed to serve as Curbline’s majority-owned partnership subsidiary and to own, through affiliates, all of the real estate properties and assets. The Operating Partnership’s capital includes common general and limited partnership interests in the Operating Partnership (“Common Units”) and LTIP Units, as defined in the partnership agreement (together with the Common Units, the “OP Units”). As of September 30, 2025, Curbline owned, from a legal perspective, approximately 99.1% of the outstanding OP Units with the remaining OP Units held by members of management through LTIP Units subject to vesting requirements.
As of September 30, 2025, the Company’s portfolio consisted of 162 convenience shopping centers aggregating 4.5 million square feet of owned gross leasable area (“GLA”). At September 30, 2025, the aggregate leased rate and occupancy rate of the Company’s operating shopping center portfolio was 96.7% and 93.9%, respectively and the average annualized base rent (“ABR”) per occupied square foot was $34.38. Prior to the Company’s Spin-Off on October 1, 2024, the Company was a wholly owned subsidiary of SITE Centers Corp. (“SITE Centers”).
Convenience shopping centers are generally positioned on the curbline of well-trafficked intersections and major vehicular corridors, in suburban, high household income communities, offering excellent access and visibility, dedicated parking and often include drive-thru units, with approximately half of the Company’s properties having at least one drive-thru unit as of September 30, 2025. Convenience shopping centers generally consist of a homogenous row of primarily small-shop units leased to a diversified mixture of national, regional and local service and restaurant tenants that cater to daily convenience trips from the growing suburban population and typically experience more customer foot traffic per square foot than anchored retail. The property type has the opportunity to generate above-average, occupancy-neutral cash flow growth driven by high retention rates and limited operating capital expenditures given the standardized site plan and the depth of leasing prospects that can utilize existing square footage and provide significant tenant diversification. As of September 30, 2025, the average GLA of a property in the Curbline portfolio was approximately 28,000 square feet with 94% of base rent generated by units less than 10,000 square feet.
Prior to the Spin-Off
The historical results of operations and liquidity and capital resources of Curbline prior to the Spin-Off do not represent the historical results of operations and liquidity and capital resources of a legal entity, but rather a combination of entities under common control that have been “carved out” of SITE Centers’ consolidated financial statements and presented on a combined basis, in each case, in accordance with U.S. generally accepted accounting principles (“GAAP”) and may impact comparability between periods. The preparation of the financial results of the Company prior to the Spin-Off required management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the relevant reporting periods and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.
The financial results of the Company prior to the Spin-Off reflect the revenues and direct expenses of the Company and include material assets and liabilities of SITE Centers that are specifically attributable to the Company. Equity represents the excess of total assets over total liabilities. Equity is impacted by contributions from and distributions to SITE Centers, which are the result of treasury activities and net funding provided by or distributed to SITE Centers prior to the separation, as well as the allocated costs and expenses.
The financial results of the Company prior to the Spin-Off also include an allocation of indirect costs and expenses incurred by SITE Centers related to the Company, primarily consisting of compensation and other general and administrative costs using the relative percentage of GLA of the Company and SITE Centers management’s knowledge of the Company. The amounts allocated in
23
the financial results of the Company prior to the Spin-Off are not necessarily indicative of the actual amount of such indirect expenses that would have been recorded had the Company been a separate independent entity during the applicable periods. The Company believes the assumptions underlying the Company’s allocation of indirect expenses prior to the Spin-Off are reasonable.
Current Strategy
The Company believes that as the first and only publicly traded real estate company focused exclusively on the convenience real estate sector it is well positioned to take advantage and aggregate the highly fragmented but liquid marketplace for convenience shopping centers. As of September 30, 2025, the Company was in a net cash position with $430.1 million of cash on hand plus significant access to debt capital in order to grow its asset base through acquisitions. With over 68,000 convenience shopping centers in the United States (950 million square feet of GLA) and a liquid transaction market (primarily among private investors), the property type provides a substantial addressable opportunity for the Company to scale and differentiate itself as the first mover public REIT exclusively focused on convenience assets.
Curbline’s acquisition strategy is focused on a number of real estate and financial factors including demographics, property access and visibility, vehicular traffic, tenant credit profile, rent mark-to-market opportunities and prospects for cash flow growth. The Company’s current portfolio is generally located in submarkets with compelling long-term population and employment growth prospects and above-average household incomes of over $117,000 as compared to the national median household income of $83,730.
The Company focuses on leasing space to a diversified group of primarily national, high credit quality tenants operating across a wide range of service and restaurant businesses, including quick-service restaurants, healthcare and wellness operators, financial services, beverage retail, telecommunications, beauty and hair salons, and fitness, among others.
Convenience properties offer the opportunity to generate above-average, occupancy-neutral cash flow growth (compared to cash flow growth levels for other retail real estate assets) through rental income increases from either fixed annual rental increases or renewal option increases embedded in tenant leases, elevated retention rates limiting lost rent resulting from vacancy, and positive mark-to-market of leases at renewal. In addition, tenant lease agreements at convenience properties typically have shorter lease terms and fewer tenant renewal options with approximately 51% of the ABR under Curbline’s leases expiring within the next five years without any tenant renewal option assumptions. The duration of convenience tenant leases provides Curbline with more frequent opportunities to increase rents to market levels and to mitigate the risk and impact of inflation. Convenience properties’ standardized site plans, high tenant retention rates, higher annualized base rents per square foot, and the depth of leasing prospects that can utilize existing square footage also generally result in lower operating capital expenditure levels as a percentage of annualized base rents over time relative to other retail real estate formats including grocery, lifestyle and regional power center properties.
Transaction and Capital Markets Highlights
Transactional and investment highlights for the Company from January 1, 2025 through October 29, 2025, include the following:
24
Operational Metrics
Key operational results and transactions for the Company from January 1, 2025 through September 30, 2025 include the following:
Cash leasing spreads are a key metric in real estate, representing the percentage increase of the tenant’s annual base rent in the first year of the newly executed or renewal lease over the annual base rent applicable to the final year of the previous lease term. The Company’s cash leasing spread calculation excludes deals for first generation units, or where the unit was vacant at the time of acquisition, and as a result, is a good benchmark to compare the average annualized base rent of expiring leases with the comparable executed market rental rates.
Summary Financial Results
The following provides an overview of the Company’s key financial metrics (see “Non-GAAP Financial Measures” described later in this section) (in thousands except per share amounts):
|
Three Months |
|
|
Nine Months |
|
||||||||||
|
Ended September 30, |
|
|
Ended September 30, |
|
||||||||||
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Net income (loss) attributable to Curbline |
$ |
9,346 |
|
|
$ |
(15,410 |
) |
|
$ |
30,288 |
|
|
$ |
(1,199 |
) |
FFO attributable to Curbline |
$ |
29,096 |
|
|
$ |
(4,302 |
) |
|
$ |
80,461 |
|
|
$ |
28,520 |
|
Operating FFO attributable to Curbline |
$ |
29,514 |
|
|
$ |
19,512 |
|
|
$ |
81,581 |
|
|
$ |
59,675 |
|
Earnings per share - Diluted |
$ |
0.09 |
|
|
$ |
(0.15 |
) |
|
$ |
0.28 |
|
|
$ |
(0.01 |
) |
For the nine months ended September 30, 2025, the increase in net income (loss) and FFO attributable to Curbline, as compared to the prior-year period, was primarily attributable to the net impact of property acquisitions, an increase in interest income and a decrease in transaction costs related to the Spin-Off, partially offset by an increase in interest expense and general and administrative expenses. The increase in Operating FFO attributable to Curbline generally was due to the net impact of property acquisitions and an increase in interest income, partially offset by an increase in interest expense and general and administrative expenses.
25
RESULTS OF OPERATIONS
For the comparison of 2025 performance to 2024, presented below, convenience properties owned as of January 1, 2024, are referred to herein as the “Comparable Portfolio Properties.”
Revenues from Operations (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Rental income(A) |
$ |
48,466 |
|
|
$ |
29,576 |
|
|
$ |
18,890 |
|
Other income |
|
181 |
|
|
|
186 |
|
|
|
(5 |
) |
Total revenues |
$ |
48,647 |
|
|
$ |
29,762 |
|
|
$ |
18,885 |
|
|
Nine Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Rental income(A) |
$ |
128,008 |
|
|
$ |
85,386 |
|
|
$ |
42,622 |
|
Other income |
|
736 |
|
|
|
572 |
|
|
|
164 |
|
Total revenues |
$ |
128,744 |
|
|
$ |
85,958 |
|
|
$ |
42,786 |
|
(A) The following tables summarize the key components of rental income (in thousands):
|
|
Three Months |
|
|
|
|
||||||
|
|
Ended September 30, |
|
|
|
|
||||||
Rental Income |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Base and percentage rental income |
|
$ |
36,334 |
|
|
$ |
22,152 |
|
|
$ |
14,182 |
|
Recoveries from tenants |
|
|
12,148 |
|
|
|
6,724 |
|
|
|
5,424 |
|
Uncollectible revenue |
|
|
(350 |
) |
|
|
(33 |
) |
|
|
(317 |
) |
Lease termination fees, ancillary and other rental income |
|
|
334 |
|
|
|
733 |
|
|
|
(399 |
) |
Total rental income |
|
$ |
48,466 |
|
|
$ |
29,576 |
|
|
$ |
18,890 |
|
|
|
Nine Months |
|
|
|
|
||||||
|
|
Ended September 30, |
|
|
|
|
||||||
Rental Income |
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Base and percentage rental income(1) |
|
$ |
95,141 |
|
|
$ |
63,242 |
|
|
$ |
31,899 |
|
Recoveries from tenants(2) |
|
|
31,963 |
|
|
|
18,407 |
|
|
|
13,556 |
|
Uncollectible revenue |
|
|
(784 |
) |
|
|
(512 |
) |
|
|
(272 |
) |
Lease termination fees, ancillary and other rental income(3) |
|
|
1,688 |
|
|
|
4,249 |
|
|
|
(2,561 |
) |
Total rental income |
|
$ |
128,008 |
|
|
$ |
85,386 |
|
|
$ |
42,622 |
|
|
|
2025 vs. 2024 |
|
|
Acquisition of convenience shopping centers |
|
$ |
29.6 |
|
Comparable Portfolio Properties |
|
|
0.9 |
|
Straight-line rents |
|
|
1.4 |
|
Total |
|
$ |
31.9 |
|
At September 30, 2025 and 2024, the Company owned 162 and 79 wholly owned properties, respectively, with an aggregate occupancy rate of 93.9% and 93.8%, respectively, and average ABR per occupied square foot of $34.38 and $35.65, respectively.
26
Expenses from Operations (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Operating and maintenance |
$ |
6,652 |
|
|
$ |
3,541 |
|
|
$ |
3,111 |
|
Real estate taxes |
|
5,988 |
|
|
|
3,311 |
|
|
|
2,677 |
|
General and administrative |
|
7,265 |
|
|
|
3,578 |
|
|
|
3,687 |
|
Depreciation and amortization |
|
19,777 |
|
|
|
11,108 |
|
|
|
8,669 |
|
|
$ |
39,682 |
|
|
$ |
21,538 |
|
|
$ |
18,144 |
|
|
Nine Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Operating and maintenance(A) |
$ |
17,720 |
|
|
$ |
9,532 |
|
|
$ |
8,188 |
|
Real estate taxes(A) |
|
15,780 |
|
|
|
9,307 |
|
|
|
6,473 |
|
General and administrative(B) |
|
24,349 |
|
|
|
7,304 |
|
|
|
17,045 |
|
Depreciation and amortization(A) |
|
50,279 |
|
|
|
29,719 |
|
|
|
20,560 |
|
|
$ |
108,128 |
|
|
$ |
55,862 |
|
|
$ |
52,266 |
|
|
|
Operating |
|
|
Real Estate |
|
|
Depreciation |
|
|||
Acquisition of convenience shopping centers |
|
$ |
5.9 |
|
|
$ |
5.8 |
|
|
$ |
22.2 |
|
Comparable Portfolio Properties |
|
|
2.3 |
|
|
|
0.7 |
|
|
|
(1.6 |
) |
|
|
$ |
8.2 |
|
|
$ |
6.5 |
|
|
$ |
20.6 |
|
Other Income and Expenses (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Interest expense |
$ |
(3,983 |
) |
|
$ |
— |
|
|
$ |
(3,983 |
) |
Interest income |
|
4,107 |
|
|
|
— |
|
|
|
4,107 |
|
Other income (expense), net |
|
313 |
|
|
|
(23,634 |
) |
|
|
23,947 |
|
Tax expense of taxable REIT subsidiaries and state franchise |
|
(44 |
) |
|
|
— |
|
|
|
(44 |
) |
27
|
Nine Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Interest expense(A) |
$ |
(6,317 |
) |
|
$ |
(416 |
) |
|
$ |
(5,901 |
) |
Interest income(B) |
|
15,340 |
|
|
|
— |
|
|
|
15,340 |
|
Other income (expense), net(C) |
|
866 |
|
|
|
(30,879 |
) |
|
|
31,745 |
|
Gain on disposition of real estate, net |
|
42 |
|
|
|
— |
|
|
|
42 |
|
Tax expense of taxable REIT subsidiaries and state franchise |
|
(221 |
) |
|
|
— |
|
|
|
(221 |
) |
Non-Controlling Interests and Net Income (Loss) (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Income attributable to non-controlling interests |
$ |
(12 |
) |
|
$ |
— |
|
|
$ |
(12 |
) |
Net income (loss) attributable to Curbline |
|
9,346 |
|
|
|
(15,410 |
) |
|
|
24,756 |
|
|
Nine Months |
|
|
|
|
||||||
|
Ended September 30, |
|
|
|
|
||||||
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
Income attributable to non-controlling interests |
$ |
(38 |
) |
|
$ |
— |
|
|
$ |
(38 |
) |
Net income (loss) attributable to Curbline(A) |
|
30,288 |
|
|
|
(1,199 |
) |
|
|
31,487 |
|
NON-GAAP FINANCIAL MEASURES
Funds from Operations and Operating Funds from Operations
Definition and Basis of Presentation
The Company believes that Funds from Operations (“FFO”) and Operating FFO (as defined below), both non-GAAP financial measures, provide additional and useful means to assess the financial performance of REITs. FFO and Operating FFO are frequently used by the real estate industry, as well as securities analysts, investors and other interested parties, to evaluate the performance of REITs. 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 excludes GAAP historical cost depreciation and amortization of real estate and real estate investments, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions, and many companies use different depreciable lives and methods. Because FFO excludes depreciation and amortization unique to real estate and gains and losses from property dispositions, it can provide a performance measure that, when compared year over year, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, interest costs and acquisition, disposition and development activities. This provides a perspective of the Company’s financial performance not immediately apparent from net income (loss) determined in accordance with GAAP.
28
FFO is generally defined and calculated by the Company as net income (loss) attributable to Curbline (computed in accordance with GAAP), adjusted to exclude (i) gains and losses from disposition of real estate property, which are presented net of taxes, (ii) impairment charges on real estate property, (iii) gains and losses from changes in control and (iv) certain non-cash items. These non-cash items principally include real property depreciation and amortization of intangibles net of depreciation allocated to non-controlling interests. The Company’s calculation of FFO is consistent with the definition of FFO provided by the National Association of Real Estate Investment Trusts (“NAREIT”).
The Company believes that certain charges, income and gains/losses recorded in its operating results are not comparable or reflective of its core operating performance. Operating FFO is useful to investors as the Company removes non-comparable charges, income and gains to analyze the results of its operations and assess performance of the core operating real estate portfolio. As a result, the Company also computes Operating FFO and discusses it with the users of its financial statements, in addition to other measures such as net income (loss) determined in accordance with GAAP and FFO. Operating FFO is generally defined and calculated by the Company as FFO excluding certain non-operating charges, income and gains/losses that management believes are not comparable and indicative of the results of the Company’s operating real estate portfolio. Such adjustments include gains/losses on early extinguishments of debt, transaction costs and other restructuring type costs, including employee separation costs. The disclosure of these adjustments is regularly requested by users of the Company’s financial statements.
The adjustment for these charges, income and gains/losses may not be comparable to how other REITs or real estate companies calculate their results of operations, and the Company’s calculation of Operating FFO differs from NAREIT’s definition of FFO. Additionally, the Company provides no assurances that these charges, income and gains/losses are non-recurring. These charges, income and gains/losses could reasonably be expected to recur in future results of operations.
These measures of performance are used by the Company for several business purposes and by other REITs. The Company uses FFO and/or Operating FFO in part (i) as a disclosure to improve the understanding of the Company’s operating results among the investing public, (ii) as a measure of a real estate asset company’s performance, (iii) to influence acquisition, disposition and capital investment strategies and (iv) to compare the Company’s performance to that of other publicly traded shopping center REITs.
For the reasons described above, management believes that FFO and Operating FFO provide the Company and investors with an important indicator of the Company’s operating performance. They provide recognized measures of performance other than GAAP net income (loss), which may include non-cash items. Other real estate companies may calculate FFO and Operating FFO in a different manner.
Management recognizes the limitations of FFO and Operating FFO when compared to GAAP’s net income (loss). FFO and Operating FFO do not represent amounts available for dividends, capital replacement or expansion, debt service obligations or other commitments and uncertainties. Management does not use FFO or Operating FFO as an indicator of the Company’s cash obligations and funding requirements for future commitments, acquisitions or development activities. Neither FFO nor Operating FFO represents cash generated from operating activities in accordance with GAAP, and neither is necessarily indicative of cash available to fund cash needs. Neither FFO nor Operating FFO should be considered an alternative to net income (loss) (computed in accordance with GAAP) or as an alternative to cash flow as a measure of liquidity. FFO and Operating FFO are simply used as additional indicators of the Company’s operating performance. The Company believes that to further understand its performance, FFO and Operating FFO should be compared with the Company’s reported net income (loss) and considered in addition to cash flows determined in accordance with GAAP, as presented in its consolidated financial statements. Reconciliations of these measures to their most directly comparable GAAP measure of net income (loss) have been provided below.
29
Reconciliation Presentation
A reconciliation of net income (loss) to FFO and Operating FFO is as follows (in thousands). The Company provides no assurances that these charges, income and gains/losses adjusted in the calculation of Operating FFO are non-recurring. These charges, income and gains/losses could reasonably be expected to recur in future results of operations.
|
Three Months |
|
|
Nine Months |
|
||||||||||
|
Ended September 30, |
|
|
Ended September 30, |
|
||||||||||
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Net income (loss) attributable to Curbline |
$ |
9,346 |
|
|
$ |
(15,410 |
) |
|
$ |
30,288 |
|
|
$ |
(1,199 |
) |
Depreciation and amortization of real estate investment, net |
|
19,750 |
|
|
|
11,108 |
|
|
|
50,215 |
|
|
|
29,719 |
|
Gain on disposition of real estate, net |
|
— |
|
|
|
— |
|
|
|
(42 |
) |
|
|
— |
|
FFO attributable to Curbline |
|
29,096 |
|
|
|
(4,302 |
) |
|
|
80,461 |
|
|
|
28,520 |
|
Separation and other charges |
|
— |
|
|
|
186 |
|
|
|
— |
|
|
|
304 |
|
Transaction, debt extinguishment and other costs, net of |
|
418 |
|
|
|
23,628 |
|
|
|
1,120 |
|
|
|
30,851 |
|
Operating FFO attributable to Curbline |
$ |
29,514 |
|
|
$ |
19,512 |
|
|
$ |
81,581 |
|
|
$ |
59,675 |
|
The increase in net income (loss) and FFO attributable to Curbline for the nine months ended September 30, 2025, as compared to the prior-year period, was primarily attributable to the net impact of property acquisitions, an increase in interest income and a decrease in transaction costs related to the Spin-Off, partially offset by an increase in interest expense and general and administrative expenses. The increase in Operating FFO attributable to Curbline was primarily due to the net impact of property acquisitions and an increase in interest income, partially offset by an increase in interest expense and general and administrative expenses.
Net Operating Income and Same-Property Net Operating Income
Definition and Basis of Presentation
The Company uses net operating income (“NOI”), which is a non-GAAP financial measure, as a supplemental performance measure. NOI is calculated as property revenues less property-related expenses and excludes depreciation and amortization expense, interest income and expense and corporate level transactions. 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.
The Company also presents NOI information on a same property basis, or Same-Property Net Operating Income (“SPNOI”). The Company defines SPNOI as property revenues less property-related expenses, which exclude straight-line rental income and reimbursements and expenses, lease termination income, management fee expense and fair market value of leases. SPNOI only includes assets owned for the entirety of both comparable periods. SPNOI excludes all non-property and corporate level revenue and expenses. Other real estate companies may calculate NOI and SPNOI in a different manner. The Company believes SPNOI provides investors with additional information regarding the operating performance of comparable assets because it excludes certain non-cash and non-comparable items as noted above. SPNOI is frequently used by the real estate industry, as well as securities analysts, investors and other interested parties, to evaluate the performance of REITs.
SPNOI is not, and is not intended to be, a presentation in accordance with GAAP. SPNOI information has its limitations as it excludes any capital expenditures associated with the re-leasing of tenant space or as needed to operate the assets. SPNOI does not represent amounts available for dividends, capital replacement or expansion, debt service obligations or other commitments and uncertainties. Management does not use SPNOI as an indicator of the Company’s cash obligations and funding requirements for future commitments, acquisitions or development activities. SPNOI does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs. SPNOI should not be considered as an alternative to net income (loss) (computed in accordance with GAAP) or as an alternative to cash flow as a measure of liquidity. A reconciliation of NOI and SPNOI to their most directly comparable GAAP measure of net income (loss) is provided below.
30
Reconciliation Presentation
The Company’s reconciliation of net income (loss) computed in accordance with GAAP to NOI and SPNOI for the Company is as follows (in thousands):
|
For the Nine Months Ended |
|
|||||
|
September 30, |
|
|||||
|
2025 |
|
|
2024 |
|
||
Net income (loss) attributable to Curbline |
$ |
30,288 |
|
|
$ |
(1,199 |
) |
Interest expense |
|
6,317 |
|
|
|
416 |
|
Interest income |
|
(15,340 |
) |
|
|
— |
|
Depreciation and amortization |
|
50,279 |
|
|
|
29,719 |
|
General and administrative |
|
24,349 |
|
|
|
7,304 |
|
Other income (expense), net |
|
(866 |
) |
|
|
30,879 |
|
Gain on disposition of real estate, net |
|
(42 |
) |
|
|
— |
|
Tax expense |
|
221 |
|
|
|
— |
|
Non-controlling interests |
|
38 |
|
|
|
— |
|
Total Curbline NOI |
|
95,244 |
|
|
|
67,119 |
|
Less: Non-Same Property NOI |
|
(34,495 |
) |
|
|
(8,561 |
) |
Total Same-Property NOI |
$ |
60,749 |
|
|
$ |
58,558 |
|
|
|
|
|
|
|
||
Total Curbline NOI % Change |
|
41.9 |
% |
|
|
|
|
Same-Property NOI % Change |
|
3.7 |
% |
|
|
|
|
The same-property increase for the nine months ended September 30, 2025, as compared to the prior-year period, was primarily attributable to minimum rent increases resulting from rent steps or option rent increases and increases in recoveries from tenants.
LIQUIDITY, CAPITAL RESOURCES AND FINANCING ACTIVITIES
The Company requires capital to fund its business plan including investment activities, capital expenditures and operating expenses. At September 30, 2025, the Company’s primary sources of capital were unrestricted cash balances of $430.1 million and a $400.0 million unsecured, undrawn line of credit along with cash flow from operations. The Company may also raise additional capital as appropriate to finance the growth of its business. Debt outstanding was $400.0 million as of September 30, 2025. As of December 31, 2024, there was no indebtedness outstanding.
Indebtedness
In connection with the Spin-Off, the Operating Partnership, as borrower, the Company, the lenders named therein and Wells Fargo Bank, National Association, as administrative agent entered into a credit agreement (the “2024 Credit Agreement”). The 2024 Credit Agreement provides for a revolving credit facility in the amount of $400.0 million (the “Revolving Credit Facility”) and a delayed draw 2024 Term Loan in the amount of $100.0 million (the “2024 Term Loan” and together with the Revolving Credit Facility, the “2024 Credit Facilities”). The aggregate amount available under the 2024 Credit Facilities may be increased up to $750.0 million so long as existing or new lenders agree to provide incremental commitments and subject to the satisfaction of certain customary conditions.
The Revolving Credit Facility matures on September 29, 2028, subject to two six-month options to extend the maturity to September 29, 2029 at the Operating Partnership’s option and subject to the satisfaction of certain conditions. Borrowings under the Revolving Credit Facility bear interest at variable rates at the Operating Partnership’s election, based on either (i) the term or daily simple SOFR rate plus a credit spread adjustment plus an applicable margin, or (ii) the alternative base rate plus an applicable margin. The Revolving Credit Facility also provides for a facility fee, paid on a quarterly basis. Each of the applicable margin and the facility fee under the Revolving Credit Facility varies based on whether the Company has obtained a long-term senior unsecured debt rating of at least BBB- (or the equivalent) from S&P Global Ratings or Fitch Investor Services Inc. or a long-term unsecured debt rating of Baa3 (or the equivalent) from Moody’s Investors Service, Inc. (each, an “IG Rating”). Prior to obtaining an IG Rating, each of the applicable margin and facility fee was based on the Company’s ratio of consolidated outstanding indebtedness to consolidated market value and after obtaining an IG Rating, the applicable margin and facility fee is based on the Company’s IG Rating. In May 2025, the Fitch Ratings assigned the Company a Long-Term Issuer Default Rating of BBB. No amounts were drawn under the Revolving Credit Facility as of September 30, 2025.
31
The Company drew $100.0 million on the 2024 Term Loan in March 2025 which will mature on October 1, 2027, subject to two one-year options to extend its maturity to October 1, 2029 at the Operating Partnership’s option and subject to the satisfaction of certain conditions. Loans under the 2024 Term Loan bear interest at variable rates at the Operating Partnership’s election, based on either (i) the term or daily simple SOFR rate plus a credit spread adjustment plus an applicable margin or (ii) the alternative base rate plus an applicable margin. Similar to the Revolving Credit Facility, the applicable margin under the 2024 Term Loan varies. Prior to obtaining an IG Rating, the applicable margin was based on the Company’s ratio of consolidated outstanding indebtedness to consolidated market value and after obtaining an IG Rating, the applicable margin is based on the Company’s IG Rating. As of September 30, 2025, $100.0 million is outstanding under the 2024 Term Loan.
The 2024 Credit Agreement contains certain customary covenants including, among other things, leverage ratios and debt service coverage and fixed-charge coverage ratios, as well as limitations on the Company’s ability to sell all or substantially all of the Company’s assets and engage in certain mergers and acquisitions. The 2024 Credit Agreement also contains customary default provisions including, among other things, the failure to make timely payments of principal and interest payable thereunder and the failure of the Company or its subsidiaries to pay, when due, certain indebtedness in excess of certain thresholds beyond applicable grace and cure periods. As of September 30, 2025, the Company was in compliance with all its financial covenants governing its debt. Although the Company believes it will continue to operate in compliance with these covenants, if the Company were to violate these covenants, the Company may be subject to higher finance costs and fees or accelerated maturities.
The Company maintains a $100.0 million interest rate swap agreement to fix the variable-rate SOFR component of the Company’s $100.0 million 2024 Term Loan to 3.58%, from April 1, 2025 through October 1, 2028. In April 2025, the Company entered into a $100.0 interest rate swap agreement to fix the variable-rate SOFR component of the Company’s 2024 Term Loan at 3.71% from October 1, 2028 through October 1, 2029. Following the investment grade rating and simultaneously with the Company’s borrowing of the 2025 Term Loan discussed below, the 2024 Credit Agreement was amended to reduce the interest rate spread resulting in an all-in rate for the 2024 Term Loan of 4.53% based on the loan’s current applicable spread as of September 30, 2025.
On June 26, 2025, the Company and the Operating Partnership entered into a Note and Guaranty Agreement (the “Note and Guaranty Agreement”) in connection with a private placement of $150.0 million of the Operating Partnership’s senior unsecured notes (the “2025 Notes”), consisting of (i) $100.0 million aggregate principal amount of 5.58% senior unsecured notes due September 3, 2030 and (ii) $50.0 million aggregate principal amount of 5.87% senior unsecured notes due September 3, 2032, to a group of institutional investors. The sale and purchase of the 2025 Notes was completed on September 3, 2025. In conjunction with this agreement, the Company entered into an interest rate lock agreement resulting in a 5.79% effective interest rate on the 2025 Notes due September 3, 2032 and a weighted-average coupon of 5.65%.
The 2025 Notes bear interest on the outstanding principal balance at the stated rates per annum from the date of issuance, payable semi-annually in arrears, until such principal becomes due and payable. The entire unpaid principal balance of each 2025 Note shall be due and payable on the maturity date thereof. The 2025 Notes are senior unsecured obligations of the Operating Partnership and rank equal in right of payment with all other senior unsecured indebtedness of the Operating Partnership. The 2025 Notes are unconditionally guaranteed by the Company.
The Operating Partnership is permitted to prepay the outstanding 2025 Notes in whole or in part, in an amount not less than 5% of the aggregate principal amount of the 2025 Notes then outstanding, at any time at (i) 100% of the principal amount so prepaid, plus (ii) the make-whole amount, which is equal to the excess, if any, of the discounted value of the remaining scheduled principal and interest payments with respect to the 2025 Notes being prepaid over the principal amount of such 2025 Notes. The discount rate to be used is equal to 0.50% plus the yield to maturity reported for the most recently actively traded U.S. Treasury Securities with a maturity equal to the remaining average life of the prepaid principal. If a change in control occurs for the Company, the Operating Partnership must offer to prepay the outstanding 2025 Notes. The prepayment amount will be 100% of the principal amount, as well as accrued and unpaid interest but without any make-whole amount.
The Note and Guaranty Agreement contains certain customary covenants including, among other things, a maximum total leverage ratio, a maximum secured leverage ratio, a maximum unencumbered leverage ratio, a minimum fixed charge coverage ratio and a minimum unsecured interest coverage ratio.
In connection with the Note and Guaranty Agreement, the Company executed a treasury lock hedge transaction in May 2025 to hedge the risk-free treasury yield component of the overall rate ultimately assigned to the $50.0 million of the 2025 Notes due September 3, 2032. The treasury lock secured a treasury yield of 4.19%. The hedge transaction settled on June 9, 2025, in connection with the pricing of the 2025 Notes, and included proceeds of $0.2 million, which were recognized as a gain within Accumulated other comprehensive income on the consolidated balance sheets as of September 30, 2025. This amount is amortized on a straight-line basis as a decrease to interest expense over the term of the 2025 Notes.
32
In July 2025, the Company and the Operating Partnership entered into a term loan agreement with a syndicate of lenders and PNC, National Association, as administrative agent (the “2025 Term Loan Agreement”), which provides for an unsecured, term loan in the amount of $150.0 million (the “2025 Term Loan”). In connection with entering into the 2025 Term Loan Agreement, the Operating Partnership borrowed the full $150.0 million under the 2025 Term Loan. The aggregate amount available under the 2025 Term Loan Agreement may be increased to $250.0 million so long as existing or new lenders agree to provide incremental commitments and subject to the satisfaction of certain customary conditions. The 2025 Term Loan will mature in January 2029, subject to two one-year options to extend its maturity to January 2031 at the Operating Partnership’s option and subject to the satisfaction of certain customary conditions.
Loans under the 2025 Term Loan bear interest at variable rates at the Operating Partnership’s election, based on either (i) the term or daily simple SOFR rate plus an applicable margin or (ii) the alternative base rate plus an applicable margin. The applicable margin under the 2025 Term Loan varies based on the rating assigned by S&P Global Ratings, Moody’s Investors Service, Inc. or Fitch Investor Services Inc. to the senior unsecured long-term indebtedness of Company or the Operating Partnership. In May 2025, the Company entered into a $150.0 million forward interest rate swap agreement to fix the variable-rate SOFR component of the 2025 Term Loan at 3.66% from July 16, 2025 through January 1, 2031. The all-in rate of the 2025 Term Loan is fixed at 4.61% based on the loan’s current applicable spread.
Anticipated Private Placement Notes Offering
On October 23, 2025, the Company and the Operating Partnership priced a private placement offering of $200.0 million of the Operating Partnership’s senior unsecured notes (the “2026 Notes”), consisting of (i) $50.0 million aggregate principal amount of 4.90% senior unsecured notes due January 20, 2031 (the “5-Year Notes”) and (ii) $150.0 million aggregate principal amount of 5.13% senior unsecured notes due January 20, 2033 (the “7-Year Notes”), with a group of institutional investors. Considering the treasury lock agreements noted below, the interest rate on the notes will be fixed at 5.06% and 5.31%, respectively.
The Company and the Operating Partnership expect to enter into a Note and Guaranty Agreement on November 12, 2025 pursuant to which the Operating Partnership expects to issue the 2026 Notes on or around year-end and in the first quarter of 2026. The 2026 Notes are expected to be on similar terms to the 2025 Notes. However, there can be no assurance that the terms will be similar or that the Company and the Operating Partnership will enter such Note and Guaranty Agreement or that the issuance of the 2026 Notes will be completed.
In connection with the anticipated private placement offering of the 2026 Notes, the Company executed two treasury lock hedge transactions in September 2025 to hedge the treasury yield component of the overall rate ultimately assigned to the two tranches of 2026 Notes. The treasury locks secured a treasury yield of 3.96% for the anticipated $150.0 million of 7-Year Notes and a treasury yield of 3.76% for the anticipated $50 million of 5-Year Notes. The hedge transactions settled on October 23, 2025, in connection with the pricing of the 2026 Notes, and included a payment of $2.0 million, which will be recognized as a loss within Accumulated OCI on the consolidated balance sheets as of December 31, 2025. This amount will be amortized on a straight-line basis as an increase to interest expense over the terms of the 5-Year and the 7-Year notes.
As part of its growth strategy, the Company may incur additional debt to finance future acquisitions, including debt that refinances or replaces borrowings under the Revolving Credit Facility, the 2024 Term Loan, the 2025 Notes or the 2025 Term Loan. While the Company believes it has several viable sources to obtain capital and fund its business, the sources of funds could be affected by various risks and uncertainties.
Dividend Distributions
The Company declared a quarterly cash dividend of $0.16 per share for each of the first three quarters in 2025. The dividends are summarized as follows (in millions):
Quarter Declared |
|
Amount Declared |
|
|
Date Paid |
|
Amount Paid |
|
||
First quarter 2025 |
|
$ |
17.1 |
|
|
April 8, 2025 |
|
$ |
17.0 |
|
Second quarter 2025 |
|
|
17.1 |
|
|
July 9, 2025 |
|
|
17.0 |
|
Third quarter 2025 |
|
|
17.1 |
|
|
October 21, 2025 |
|
|
17.0 |
|
Total year to date |
|
$ |
51.3 |
|
|
|
|
$ |
51.0 |
|
The Company anticipates making distributions to holders of its common stock to satisfy REIT requirements and generally not be subject to U.S. federal income tax (other than with respect to operations conducted through a taxable REIT subsidiary of the Company) or excise tax. U.S. federal income tax law generally requires that a REIT distribute annually at least 90% of its REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and that it pay tax at regular corporate rates to the extent that it annually distributes less than 100% of its REIT taxable income. The Company generally intends to
33
make distributions with respect to each taxable year in an amount at least equal to its REIT taxable income for such taxable year. To the extent that cash available for distribution is less than the Company’s REIT taxable income, the Company may make a portion of its distributions in the form of additional shares of common stock, and any such distribution of such common stock may be taxable as a dividend to stockholders.
Although the Company generally expects to declare and pay distributions on a quarterly basis, the Company’s Board of Directors (the “Board”) will evaluate its distribution policy regularly in order to maintain sufficient liquidity for operations and in order to maximize the Company’s free cash flow while still adhering to REIT payout requirements and minimizing federal income taxes (excluding federal income taxes applicable to its taxable REIT subsidiary activities).
Any distributions the Company makes to its stockholders will be at the discretion of the Board and will depend upon, among other things, the Company’s actual and anticipated results of operations and liquidity, which will be affected by various factors, including the income from its portfolio, its operating expenses and any other expenditures.
Common Stock Repurchase Program and Common Stock Continuous Equity Program
On September 25, 2025 the Company’s Board of Directors authorized a share repurchase program of up to an aggregate purchase price of $250.0 million. Repurchases of common stock under the share repurchase program may be made from time to time in the open market, in privately negotiated purchases, in accelerated share repurchase programs or by any other lawful means. The number of shares of common stock purchased and the timing of any purchases will depend on a number of factors, including the price and availability of common stock and general market conditions. Through October 29, 2025, the Company had not repurchased any shares under this program.
On October 1, 2025, the Company entered into an agreement for the future issuance of up to $250.0 million in shares of common stock under a continuous equity program. Under the program, the Company may, at its election, enter into one or more separate forward sales agreements. The Company entered into the equity sales agreement in connection with the filing of the Company’s registration statement on Form S-3. At October 29, 2025, the Company had $250.0 million available for the future issuance of common stock under that program.
Cash Flow Activity
The Company expects that its core business of leasing space to well capitalized retailers will continue to generate consistent cash flow after expenses. The following presents a summary of consolidated statements of cash flow (in thousands):
|
Nine Months |
|
|||||
|
Ended September 30, |
|
|||||
|
2025 |
|
|
2024 |
|
||
Cash flow provided by operating activities |
$ |
98,732 |
|
|
$ |
25,256 |
|
Cash flow used for investing activities |
|
(628,288 |
) |
|
|
(234,663 |
) |
Cash flow provided by financing activities |
|
333,259 |
|
|
|
211,227 |
|
Changes in cash flows for the nine months ended September 30, 2025, compared to the prior-year period, are as follows:
Operating Activities: Cash provided by operating activities increased $73.5 million primarily due to the net impact from property acquisitions, a decrease in transaction costs related to the Spin-Off and an increase in interest income, partially offset by an increase in interest expense and general and administrative expenses.
Investing Activities: Cash used for investing activities increased $393.6 million primarily due to the increase in real estate assets acquired of $397.5 million, an increase in escrow deposits for future acquisitions of $4.7 million, partially offset by a decrease in real estate improvements of $8.5 million.
Financing Activities: Cash provided by financing activities increased $122.0 million primarily due to the proceeds from the term loans of $250.0 million and private placement unsecured notes of $150.0 million and lower repayment of mortgage debt of $25.7 million, partially offset by dividends paid of $60.4 million and a decrease in transactions with SITE Centers of $241.9 million.
SOURCES AND USES OF CAPITAL
The Company remains committed to maintaining sufficient liquidity and financial flexibility in order to pursue its stated business plan to acquire additional convenience properties and scale the Company’s portfolio while managing its overall risk profile. Cash flow from operations, as well as debt and equity financings, represent additional potential sources of proceeds to be used to execute on the Company’s business plan.
34
Acquisitions
Through October 24, 2025, the Company acquired 69 convenience shopping centers for an aggregate purchase price of $644.1 million.
Indebtedness
As of September 30, 2025, $100.0 million had been drawn on the 2024 Term Loan, $150.0 million had been drawn on the 2025 Term Loan and $150.0 million had been drawn on the 2025 Notes. For a summary of interest payable under the 2024 Term Loan, the 2025 Term Loan and the 2025 Notes, see “Indebtedness” in Liquidity, Capital Resources and Financing Activities section above.
CAPITALIZATION
At September 30, 2025, the Company’s capitalization consisted of $400.0 million of debt and $2.3 billion of market equity (calculated as shares of common stock outstanding multiplied by $22.30, the closing price of the Company’s common stock on the New York Stock Exchange on September 30, 2025).
Management seeks to maintain access to the capital resources necessary to manage the Company’s balance sheet. Accordingly, the Company may seek to obtain funds through additional debt or equity financings in a manner consistent with its intention to operate with a prudent debt capitalization policy.
The 2024 Credit Agreement, the Note and Guaranty Agreement and the 2025 Term Loan Agreement contain certain financial and operating covenants, including, among other things, debt service coverage and fixed-charge coverage ratios, as well as limitations on the Company’s ability to incur secured and unsecured indebtedness, sell all or substantially all of the Company’s assets, engage in certain mergers and acquisitions and make distribution to its stockholders. Although the Company intends to operate in compliance with these covenants, if the Company were to violate these covenants, the Company may be subject to higher finance costs and fees and accelerated maturities.
CONTRACTUAL OBLIGATIONS AND OTHER COMMITMENTS
In conjunction with the redevelopment of convenience shopping centers, the Company has entered into commitments with general contractors aggregating approximately $0.2 million for its consolidated properties at September 30, 2025. These obligations, composed principally of construction contracts, are generally due within 12 to 24 months, as the related construction costs are incurred, and are expected to be financed through operating cash flow. These contracts typically can be changed or terminated without penalty.
The Company routinely enters into contracts for the maintenance of its properties. These contracts typically can be canceled upon 30 to 60 days’ notice without penalty. At September 30, 2025, the Company had purchase order obligations, typically payable within one year, aggregating approximately $2.0 million related to the maintenance of its properties.
In addition, the Company has debt maturity and interest payment obligations as described in Note 5.
ECONOMIC CONDITIONS
The Company continues to experience steady retailer demand for vacant or available space and executed new leases and renewals aggregating approximately 370 thousand square feet of GLA for the nine months ended September 30, 2025. The Company believes the elevated portfolio leased rate and overall tenant activity are attributable to demand for space at properties located on the curbline of well-trafficked intersections and major vehicular corridors and limited new supply. Additionally, the Company’s portfolio benefits from its concentration in suburban, above-average household income communities along with positive demographic and economic trends.
The Company has a diversified tenant base, with only one tenant whose annualized rental revenue equals or exceeds 2% of the Company’s annualized consolidated rental revenues (Starbucks at 2.7% as of September 30, 2025). Other significant national tenants generally have relatively strong financial positions, have outperformed their respective retail categories over time and, the Company believes, remain well-capitalized. The majority of the tenants in the Company’s convenience shopping centers provide day-to-day consumer necessities with a focus on value and convenience, versus discretionary items, which the Company believes will enable many of the tenants to outperform under a variety of economic conditions and provide a stable revenue base. The Company has relatively little reliance on overage or percentage rents dependent on tenant sales performance or on ancillary income.
The Company believes that the convenience property portfolio is well positioned, as evidenced by recent leasing activity, historical leased and occupancy levels and consistent reported leasing spreads. At September 30, 2025, the convenience property
35
portfolio leased and occupancy rates were 96.7% and 93.9%, respectively, and the portfolio ABR per occupied square foot was $34.38, as compared to leased and occupancy rates of 95.5% and 93.9%, respectively, and ABR per occupied square foot of $35.62 at December 31, 2024. The per square foot cost of leasing capital expenditures has been consistent with the Company’s historical trends and the standardized site plan of the majority of the Company’s convenience shopping centers together with high tenant retention rates, higher ABRs per square foot and the depth of leasing prospects that can utilize existing square footage generally result in lower operating capital expenditure levels as a percentage of annualized base rents over time. The Company generally does not expend a significant amount of capital on lease renewals, which constitute the majority of overall leasing activity. The weighted-average cost of tenant improvements and lease commissions estimated to be incurred over the expected lease term for all leases executed during the nine months ended September 30, 2025 was $3.04 per rentable square foot.
Inflation, higher interest rates, evolving U.S. tariffs and retaliatory tariffs on U.S. goods and the market reaction thereto, and concerns over consumer spending growth, along with the volatility of global capital markets continue to pose risks to the U.S. economy, the retail sector overall and the Company’s tenants. The retail sector overall has also been affected by changing consumer behaviors, increased competition and e-commerce market share gains. The Company routinely monitors the credit profiles of its tenants and analyzes the possible impact of any potential tenant credit issues on the financial statements and overall cash flow, balance sheet and liquidity. In some cases, changing conditions have resulted in weaker retailers losing market share and declaring bankruptcy and/or closing stores. However, other retailers continue to expand their store fleets and launch new concepts within the suburban, high-household-income communities in which the properties are located. As a result, the Company believes that its prospects to backfill any spaces vacated by bankrupt or non-renewing tenants are generally favorable. However, there can be no assurance that vacancy resulting from increasingly uncertain economic conditions will not adversely affect the Company’s operating results.
Rising interest rates and the availability of commercial real estate financing have also impacted, at certain times, real estate owners’ ability to acquire and sell assets and raise equity and debt financing. Although the Company had $400.0 million of indebtedness as of September 30, 2025, debt capital markets liquidity could adversely impact the Company’s current and expected future business plan and its ability to finance future maturities and/or investments, and the interest rates applicable thereto. Depending on market conditions, the Company intends to acquire additional assets funded with cash on hand along with retained cash flow and debt and equity financing. The timing of certain acquisitions may be impacted by capital markets activity along with the volume and pricing of assets available to acquire. Unfavorable changes in interest rates or the capital markets could adversely impact the Company’s return on investments.
CRITICAL ACCOUNTING ESTIMATES
For a discussion of our critical accounting policies and estimates, refer to our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes to these policies during the nine months ended September 30, 2025.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company’s primary market risk exposure is interest rate risk. At September 30, 2025, the Company’s debt adjusted to reflect the swaps of the variable-rate (SOFR) components of the interest rates applicable to the 2024 Term Loan and 2025 Term Loan to fixed rates is summarized as follows:
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September 30, 2025 |
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Amount |
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Weighted- |
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Weighted- |
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Percentage |
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Fixed-Rate Debt |
$ |
396.4 |
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3.8 |
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5.0 |
% |
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100.0 |
% |
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Variable-Rate Debt |
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— |
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— |
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— |
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— |
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If the Company were to incur variable-rate indebtedness, its exposure to increases in interest rates could increase. The Company does not believe, however, that increases in interest expense as a result of inflation or other economic factors will significantly impact the Company’s distributable cash flow.
The interest rate risk on a portion of the Company’s variable-rate debt has been mitigated through the use of interest rate swap agreements with major financial institutions. At September 30, 2025, the variable-rate (SOFR) component of the interest rate applicable to the Company’s $100.0 million consolidated 2024 Term Loan and the $150.0 million consolidated 2025 Term Loan were swapped to a fixed rate through October 1, 2029 and January 1, 2031, respectively. The Company is exposed to credit risk in the event of nonperformance by the counterparties to the swaps. The Company believes it mitigates its credit risk by entering into swaps with major financial institutions.
36
The carrying value of the Company’s fixed-rate debt was adjusted to include the $250.0 million of variable-rate debt that was swapped to a fixed rate. An estimate of the effect of a 100 basis-point increase at September 30, 2025, is summarized as follows (in millions):
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September 30, 2025 |
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||||||||||
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Carrying |
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Fair |
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100 Basis-Point |
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Company's fixed-rate debt |
$ |
396.4 |
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$ |
407.0 |
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(A) |
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$ |
389.1 |
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(B) |
The Company intends to continually monitor and actively manage interest costs on any variable-rate debt portfolio and may enter into swap positions or interest rate caps. Accordingly, the cost of obtaining such protection agreements in relation to the Company’s access to capital markets will continue to be evaluated. The Company has not entered into, and does not plan to enter into, any derivative financial instruments for trading or speculative purposes. As of September 30, 2025, the Company had no other material exposure to market risk.
Item 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure and Control Procedures
The Company’s management, with the participation of the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of September 30, 2025. Based on that evaluation, the CEO and CFO have concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and were effective as of the end of such period to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its CEO and CFO, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
In August 2025, the Company completed the implementation of a new accounting software system. As part of this implementation, the Company updated its internal controls over financial reporting to address changes in business processes resulting from the new system. Management has evaluated the design and operating effectiveness of these updated controls and concluded that they are operating effectively.
Other than as noted above, there have not been any changes in the Company’s internal control over financial reporting during the three months ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.
37
PART II
OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
The Company and its subsidiaries are subject to various legal proceedings, which, taken together, are not expected to have a material adverse effect on the Company. The Company is also subject to a variety of legal proceedings or claims for personal injury or property damage arising in the ordinary course of its business, most of which are covered by insurance, although they may be subject to deductibles or retentions. While the resolution of all matters cannot be predicted with certainty, management believes that the final outcome of such legal proceedings and claims will not have a material adverse effect on the Company’s liquidity, financial position or results of operations.
Item 1A. RISK FACTORS
There have been no material changes to the risk factors set forth in the Annual Report on Form 10-K.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES
On September 25, 2025, the Board of Directors of the Company authorized a common stock repurchase program, which was announced on October 1, 2025. Under the terms of the program, the Company is authorized to repurchase up to an aggregate purchase price of $250.0 million in shares of its common stock. During the third quarter of 2025, the Company did not repurchase any shares of its common stock, and as of September 30, 2025, the dollar value of shares that may yet be purchased under the program is $250.0 million. The repurchase program has no expiration date.
Item 3. DEFAULTS UPON SENIOR SECURITIES
None.
Item 4. MINE SAFETY DISCLOSURES
Not applicable.
Item 5. OTHER INFORMATION
38
Item 6. EXHIBITS
10.1
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10.2
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10.3 |
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10.4
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10.5
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31.1 |
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31.2 |
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32.1 |
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32.2 |
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101.INS |
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Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document1 |
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101.SCH |
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Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Document1 |
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104 |
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The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 has been formatted in Inline XBRL and included in Exhibit 101. |
Attached as Exhibit 101 to this report are the following formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024, (ii) Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2025 and 2024, (iii) Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2025 and 2024, (iv) Consolidated Statements of Equity for the Three and Nine Months Ended September 30, 2025 and 2024, (v) Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024 and (vi) Notes to Consolidated Financial Statements.
39
SIGNATURES
Pursuant to the requirements 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.
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CURBLINE PROPERTIES CORP. |
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By: |
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/s/ Christina M. Yarian |
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Name: |
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Christina M. Yarian |
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Title: |
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Senior Vice President and Chief Accounting Officer (Authorized Officer; Principal Accounting Officer) |
Date: October 29, 2025 |
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40
Exhibit 10.2
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) dated as of July 15, 2025, by and among CURBLINE PROPERTIES LP, a limited partnership organized under the laws of the State of Delaware (the “Borrower”), CURBLINE PROPERTIES CORP., a corporation organized under the laws of the State of Maryland (the “Parent”), each of the Lenders party hereto, and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent (together with its successors and assigns, the “Administrative Agent”).
WHEREAS, the Borrower, the Lenders, the Issuing Lenders, the Administrative Agent and certain other parties have entered into that certain Credit Agreement dated as of October 1, 2024 (as amended and in effect immediately prior to the effectiveness of this Amendment, the “Existing Credit Agreement”); and
WHEREAS, the Parent, the Borrower, the Lenders party hereto and the Administrative Agent desire to amend certain provisions of the Existing Credit Agreement on the terms and conditions contained herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto hereby agree as follows:
Section 1. Specific Amendments to Credit Agreement. Upon the satisfaction of each of the conditions set forth in Section 2 of this Amendment, the parties hereto agree that the Existing Credit Agreement is amended as follows (the Existing Credit Agreement as amended by this Amendment shall be referred to herein as the “Amended Credit Agreement”):
(x) prior to Parent or Borrower obtaining an Investment Grade Rating, Parent shall cease to own and control, directly or indirectly, at least 80% of the outstanding Capital Stock of the Borrower free and clear of Liens securing Indebtedness for borrowed money, and (y) after Parent or Borrower has obtained an Investment Grade Rating, Parent shall cease to own and control, directly or indirectly, at least 80% of the outstanding Capital Stock of the Borrower; or
(b) Upon Parent or Borrower obtaining an Investment Grade Rating, the Applicable Margins to be used in calculating the interest rate applicable to different Classes and Types of Borrowings and the Facility Fee Rate to be used in calculating the Facility Fee shall vary from time to time in accordance with Parent’s or Borrower’s then applicable Credit Rating corresponding to the Level in the first column of the table below:
Level |
Credit Rating |
Applicable Margin for SOFR Loans under the Revolving Facility and the Facility Letter of Credit Fee |
Applicable Margin for Base Rate Loans under the Revolving Facility |
Facility Fee Rate |
Applicable Margin for SOFR Loans under the Initial Term Loan Facility |
Applicable Margin for Base Rate Loans under the Initial Term Loan Facility |
1 |
A/A2 (or higher) |
0.70% |
0.00% |
0.10% |
0.75% |
0.00% |
2 |
A-/A3 |
0.725% |
0.00% |
0.125% |
0.80% |
0.00% |
3 |
BBB+/Baa1 |
0.775% |
0.00% |
0.15% |
0.85% |
0.00% |
4 |
BBB/Baa2 |
0.85% |
0.00% |
0.20% |
0.95% |
0.00% |
5 |
BBB-/Baa3 |
1.05% |
0.05% |
0.25% |
1.20% |
0.20% |
6 |
BB+/Ba1 (or lower or unrated) |
1.40% |
0.40% |
0.30% |
1.60% |
0.60% |
If at any time Parent or Borrower has two (2) applicable Credit Ratings, the Applicable Margins and Facility Fee Rate shall be the rate per annum applicable to the highest applicable Credit Rating; provided that if the highest applicable Credit Rating and the lowest applicable Credit Rating are more than one ratings category apart, the Applicable Margins and Facility Fee Rate shall be the rate per annum applicable to applicable Credit Rating that is one ratings category below the highest applicable Credit Rating. If at any time Parent or Borrower has three (3) applicable Credit Ratings, and such applicable Credit Ratings are split, then: (A) if the difference between the highest and the lowest such applicable Credit Ratings is one ratings category (e.g. Baa2 by Moody’s and BBB- by S&P or Fitch), the Applicable Margins and Facility Fee Rate shall be the rate per annum that would be applicable if the highest of the applicable Credit Rating were used; and (B) if the difference between such applicable Credit Ratings is two (2) ratings categories (e.g. Baa1 by Moody’s and BBB- by S&P or Fitch) or more, the Applicable Margins and Facility Fee Rate shall be the rate per annum that would be applicable if the average of the two (2) highest applicable Credit Ratings were used, provided that if such average is not a recognized rating category, then the Applicable Margin and Facility Fee Rate shall be the rate per annum that would be applicable if the second highest applicable Credit Rating of the three were used. If at any time Parent or Borrower has only one applicable Credit Rating, the Applicable Margins and Facility Fee Rate shall be
2
the rate per annum applicable to such applicable Credit Rating.
If neither Parent nor Borrower has an Investment Grade Rating, the Applicable Margin and Facility Fee Rate shall be the rate per annum applicable to Level 6 in the table above.
If a rating agency downgrade or discontinuance results in an increase in the Applicable Margins or in the Facility Fee Rate and if such increase is reversed and the Applicable Margins or Facility Fee Rate is restored within ninety (90) days thereafter, at Parent’s or the Borrower’s request, the Borrower shall receive a credit against interest next due the Lenders equal to (i) interest accrued at the differential between such Applicable Margins plus (ii) the differential in the Facility Fees accruing from time to time during such period of downgrade or discontinuance.
If a rating agency upgrade results in decrease in the Applicable Margins or in the Facility Fee Rate and if such upgrade is reversed and the Applicable Margins or Facility Fee Rate is restored within ninety (90) days thereafter, the Borrower shall be required to pay an amount to the Lenders equal to the interest differential on the Borrowings and the differential on the Facility Fees during such period of upgrade.
Section 2. Conditions Precedent. The effectiveness of this Amendment is subject to receipt by the Administrative Agent of each of the following, each in form and substance satisfactory to the Administrative Agent:
Section 3. Representations. Each of the Parent and the Borrower represents and warrants to the Administrative Agent and the Lenders that:
3
Section 4. Reaffirmation of Representations by Parent and Borrower. Each of the Parent and the Borrower hereby reaffirms that the representations and warranties made or deemed made by the Parent, the Borrower and each other Loan Party in the Loan Documents to which any of them is a party are true and correct in all material respects on and as of the date hereof; provided that any representation or warranty that is qualified as to “materiality”, Material Adverse Effect or similar language shall be true and correct in all respects on and as of the date hereof and any such representation or warranty that is stated to relate solely to an earlier date shall be true and correct in all material respects (or, in the case of any such representation or warranty already qualified as to materiality, Material Adverse Effect or similar language, in all respects) on and as of such earlier date.
Section 5. Certain References. Each reference to the Existing Credit Agreement in any of the Loan Documents shall be deemed to be a reference to the Amended Credit Agreement. This Amendment shall constitute a Loan Document.
Section 6. Expenses. The Borrower shall reimburse the Administrative Agent for all reasonable out-of-pocket costs and expenses (including reasonable attorneys’ fees) incurred by the Administrative Agent in connection with the preparation, negotiation and execution of this Amendment and the other agreements and documents executed and delivered in connection herewith.
Section 7. Benefits. This Amendment shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns.
Section 8. GOVERNING LAW. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
Section 9. Effect. Except as expressly herein amended, the terms and conditions of the Existing Credit Agreement and the other Loan Documents remain in full force and effect. The amendments contained herein shall be deemed to have prospective application only from the date as of which this Amendment is dated, unless
4
otherwise specifically stated herein. The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Administrative Agent under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents.
Section 10. Release. In consideration of the amendments and agreements contained herein, each of the Parent and the Borrower hereby waives and releases the Administrative Agent, each Lender and the Issuing Lenders from any and all claims and defenses, whether known or unknown, with respect to the Existing Credit Agreement and the other Loan Documents and the transactions contemplated thereby to the extent any such claims and defenses have arisen on or prior to the date hereof.
Section 11. Counterparts. This Amendment may be executed in any number of counterparts, each of which shall be deemed to be an original and shall be binding upon all parties, their successors and assigns.
Section 12. Definitions. All capitalized terms not otherwise defined herein are used herein with the respective definitions given them in the Existing Credit Agreement.
Section 13. Reaffirmation of Guaranty. The Parent hereby reaffirms its continuing obligations to the Administrative Agent and the Lenders under that certain Guaranty dated as of October 1, 2024 (the “Guaranty”) to which the Parent is a party, and agrees that the transactions contemplated by the Amendment shall not in any way affect the validity and enforceability of the Guaranty, or reduce, impair or discharge the obligations of the Parent thereunder.
[Signatures on Next Page]
5
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to Credit Agreement to be executed as of the date first above written.
CURBLINE PROPERTIES LP,
as Borrower
By /s/ Conor M. Fennerty
Name: Conor M. Fennerty
Title: Executive Vice President, Chief Financial Officer and Treasurer
CURBLINE PROPERTIES CORP.,
as Parent
By /s/ Conor M. Fennerty
Name: Conor M. Fennerty
Title: Executive Vice President, Chief Financial Officer and Treasurer
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
PNC BANK, NATIONAL ASSOCIATION, as an Issuing Lender and as a Lender
By: /s/ Brian P. Kelly
Name: Brian P. Kelly
Title: Senior Vice President
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
U.S. BANK NATIONAL ASSOCIATION, as a Lender
By: /s Patrick T. Brooks
Name: Patrick T. Brooks
Title: Vice President
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
KEYBANK NATIONAL ASSOCIATION, as a Lender
By: /s/ Michael P. Szuba
Name: Michael. P. Szuba
Title: Senior Vice President
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
CAPITAL ONE, NATIONAL ASSOCIATION, as a Lender
By: /s/ Jessica W. Phillips
Name: Jessica W. Phillips
Title: Authorized Signatory
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
BANK OF AMERICA, N.A., as a Lender
By: /s/ Stephanie Whitman
Name: Stephanie Whitman
Title: Vice President
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
THE BANK OF NEW YORK MELLON., as a Lender
By: /s/ Cody Mainc
Name: Cody Mainc
Title: Director
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
MORGAN STANLEY BANK, N.A., as a Lender
By: /s/ Gretell Merlo
Name: Gretell Merlo
Title: Authorized Signatory
[Signatures Continued on Next Page]
[Signature Page to First Amendment to
Credit Agreement for Curbline Properties LP]
GOLDMAN SACHS BANK USA, as a Lender
By: /s/Priyankush Goswami
Name: Priyankush Goswami
Title: Authorized Signatory
Exhibit 31.1
CERTIFICATIONS
I, David R. Lukes, certify that:
October 29, 2025 |
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Date |
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|
|
|
/s/ David R. Lukes |
|
David R. Lukes |
|
President and Chief Executive Officer |
Exhibit 31.2
CERTIFICATIONS
I, Conor Fennerty, certify that:
October 29, 2025 |
|
Date |
|
|
|
|
/s/ Conor Fennerty |
|
Conor Fennerty |
|
Executive Vice President and Chief Financial Officer |
Exhibit 32.1
CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, David R. Lukes, President and Chief Executive Officer of Curbline Properties Corp. (the “Company”), certify, pursuant to 18 U.S. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:
/s/ David R. Lukes |
David R. Lukes |
President and Chief Executive OfficerOctober 29, 2025 |
Exhibit 32.2
CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Conor Fennerty, Executive Vice President and Chief Financial Officer of Curbline Properties Corp. (the “Company”), certify, pursuant to 18 U.S. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:
/s/ Conor Fennerty |
Conor Fennerty |
Executive Vice President and Chief Financial OfficerOctober 29, 2025 |