Good morning, and welcome to Kimco’s Fourth Quarter 2021 Earnings Conference. All participants will be in a listen only mode. Please note this event is being recorded. I would now like to turn the conference over to David F. Bujnicki, Senior Vice President, Investor Relations and Strategy. Please go ahead.

Good morning and thank you for joining Kimco’s quarterly earnings call. The Kimco management team participating on the call today includes Conor Flynn, Kimco’s CEO; Ross Cooper, President and Chief Investment Officer; Glenn Cohen, our CFO; Dave Jamieson, Kimco’s Chief Operating Officer, as well as other members of our executive team that are also available to answer questions during the call. As a reminder, statements made during the course of this call may be deemed forward-looking, and it is important to note that the Company’s actual results could differ materially from those projected in such forward-looking statements due to a variety of risks, uncertainties, and other factors. Please refer to the Company’s SEC filings that address such factors. During this presentation, management may make reference to certain non-GAAP financial measures that we believe help investors better understand Kimco’s operating results. Reconciliations of these non-GAAP financial measures can be found in the Investor Relations area of our website. Also, in the event our call were to incur technical difficulties, we will try to resolve as quickly as possible, and if the need arises, we will post additional information to our Investor Relations website. And with that, I will turn the call over to Conor.

Good morning, and thanks for joining us. Today, I will recap our operating results for the fourth quarter, provide an update on our strategic merger with Weingarten, and outline our key goals for the year ahead. Ross will give an update on the transaction market and Glenn will cover our earnings results and guidance for 2022. We continue to focus on execution as reflected by our strong fourth quarter performance. Leasing has been, is now, and will continue to be our first, second, and third priority. Our entire team has worked tirelessly to create a one-of-a-kind platform that utilizes our scale, portfolio quality, relationships, procurement abilities, data analytics, tenant support programs, last mile infrastructure, and pricing power. This platform has proven to be resilient when times are tough, and shown to generate growth when the economic climate is favorable. It is a key reason why we have been successful in re-leasing pandemic-induced vacancies while simultaneously attracting best-in-class operators that have embraced the future of last mile omnichannel retail. Now for some details on the quarter. Pro rata occupancy increased to 94.4%, up 30 basis points from last quarter and 50 basis points from a year ago. Anchor occupancy grew 20 basis points from last quarter to 97.1% and was up 40 basis points year-over-year. Small shop occupancy also increased and is now at 87.7%, up 40 basis points from last quarter and 160 basis points from a year ago. Our portfolio continued to exhibit strong pricing power. During the fourth quarter, as illustrated by the solid increase in new leasing spreads, which were up 14.1% based on 152 deals and 588,000 square feet. Blended spreads on renewals and options also increased by a healthy 7%, comprised of 4.1% for renewals and 13.1% for options. Overall, our combined leasing spreads grew 8.1% based on 438 deals covering nearly 2.1 million square feet. A couple of things to note about our strong results. First, the suburbanization trends spurred by the pandemic helped to increase retailer sales and supported our efforts to push rents on our high barrier to entry locations. Second, our portfolio continues to benefit from the pandemic-induced work-from-home trends as people are eating more takeout and home-cooked meals, which is driving more frequent visits to our restaurants and grocery stores. As a result of this activity, our traffic counts have exceeded 2019 levels. We expect this trend to continue in the post-pandemic new normal as shopping centers continue to play a critical role in omnichannel retail. Our strategy to have a grocery and mixed-use portfolio surrounding the first ring of our top 20 major metropolitan markets in the U.S. continues. When we started this strategy over five years ago, it was nearly a 50/50 split of our annual base rent coming from our grocery-anchored shopping centers versus our non-grocer centers. Today, 80% of our annual base rent comes from shopping centers that have a grocer. We have continued to successfully invest in our assets, and over the past year, we signed eight new grocery leases, two of which converted non-grocery spaces. The other six leases backfilled former grocers who vacated. And with the Weingarten merger now complete, we have further solidified our dominant grocery portfolio in the major Sunbelt markets. In addition, we have taken a deep dive into every asset we own and believe there continues to be further opportunity to push our ABR from the portfolio to 85% from grocery-anchored centers and increase our mixed-use over the next five years, with a combination of strategic redevelopment, leasing, acquisitions, and to a smaller extent, dispositions. The Weingarten merger was a perfect fit for our strategic vision, and I am happy to report that our fourth quarter results from the Weingarten portfolio exceeded all of our underwriting assumptions. We were ahead on leasing spreads, occupancy gains, retention rates, and cash flow. In addition, we have exceeded the high end of the synergy forecast range of $35 million to $38 million, and we will continue to mine for additional savings throughout 2022. With our first full quarter as a combined entity complete, we demonstrated that our proactive efforts to ensure a seamless integration really paid off, resulting in outperformance, including enhanced margins and cash flow. I want to thank all the new and existing Kimco employees for their ongoing commitment and contributions without skipping a beat during the integration. In closing, we have good visibility into our leasing momentum, and continue to see strong demand across our portfolio in all categories. We remain committed to strengthening our long-term earnings growth through the portfolio by curating the right merchandising mix that will drive traffic at all points of the day. Ultimately, we expect to be first in last mile retail by attracting tenants that can plug into the supply chain and deliver goods and services to the consumer in the most flexible and convenient way possible. We believe that this ongoing approach is the best way to generate long-term growth and value creation. Now I will turn it over to Ross.

Thanks, Conor, and good morning, everyone. 2021 was a banner year on many fronts, and we are incredibly excited about the positioning of Kimco and the platform we have built that will support future growth. Today, I will discuss our fourth quarter activity and then make a few comments on current market conditions and our expectations for 2022. As outlined on previous earnings calls, our Q4 transaction activity came mostly from partnership buyouts and structured investments. Buyout activity included two grocery-anchored assets in California for a gross value of $134 million, increasing our ownership from 15% to 100%. The previously announced buyout of Jamestown and the subsequent formation of a new 50/50 partnership with Blackstone’s BREIT on our portfolio of six high-quality, public-anchored centers in South Florida and Atlanta based upon a gross valuation of $425.75 million, this deal increased our ownership level from 30% to 50%. And the buyout of our partner’s 10% interest in the Centro Arlington project, a 366-unit Class A mixed-use residential asset in Arlington, Virginia for a pro rata price of $26 million, increasing the Kimco ownership on the Signature Series asset to 100%. A major benefit of our joint venture program is the ability to acquire assets throughout the cycle, while typically having both the first and last look when the partnership decides it is the appropriate time to exit. While we have had success acquiring portions of several JV assets that we didn’t previously own, we remain prudent in our evaluation. To that point, in the fourth quarter, we sold our interest in several minority-owned joint venture assets where pricing was very aggressive. We anticipate selling a few more joint venture assets in the first quarter of 2022 as the market remains extremely hot for all open-air retail centers. On the structured investment side, we closed on a $15 million mezzanine financing investment in a Sprouts-anchored center in Jacksonville, Florida, adjacent to the dominant St. Johns Town Center. As with prior mezzanine financings, we will retain a right of first refusal in connection with any future sale while achieving a double-digit current return in the interim. We expect to allocate additional capital towards our structured investment platform and will selectively add assets into the program that fit our criteria for quality locations, tenancy, demographics and sponsors. Since the inception of the preferred equity and mezzanine financing programs in late 2020, we have invested $126 million at double-digit returns, with an option to acquire each of the assets in the future. All of these investments are currently performing as expected. As we have entered 2022, a very different landscape exists than at this time last year. Rent rolls are more predictable and reliable, open-air retail has undoubtedly proven its relevancy for retailers and shoppers alike, and capital continues to flow into our sector. I would classify the investment landscape today as ultra-competitive, with very crowded bidding by qualified buyers with an abundance of capital that they are ready to put to work. The relatively modest level of increase in interest rates so far this year has not created any pause in the transaction market with equity investors or lenders at this stage. While this is a positive sign for the industry at large, it creates a challenge for us when seeking external growth opportunities. To illustrate this point, we have seen deals trading at some 5% cap rates regularly, including one-off assets and portfolios on the West Coast, Metro D.C., Florida, Boston, New York, Charlotte and elsewhere. Buyers consist of our public REIT peers, non-traded REITs, pension funds and 1031 exchange buyers. In many cases, we are competing with investors who are agnostic on asset class and see a wonderful risk-adjusted return in open-air retail when compared to industrial, multifamily, self-storage or life science, which are trading in the twos and threes. We will continue to be selective and disciplined from an acquisition perspective and ensure that there is a strategic fit or a unique circumstance that helps further differentiate Kimco in this environment. There is no question that we are extremely fortunate to have multiple avenues of investment opportunity to provide a slightly greater yield than the current market, but a higher likelihood of success than simply participating in a bidding war. As such, we will continue to work through partnership buyouts and structured investments as our main source of external growth, with perhaps a few select third-party assets in the 2022 pipeline as well. Given what we see ahead of us and currently have in the works, we are comfortable to initially guide towards being a net acquirer of real estate investments for this year. Depending on the opportunity set, market conditions, and our cost of capital, we will update you on our progress towards this goal as the year continues. I’m now happy to pass it over to Glenn to review our financial results and provide our expectations for the year ahead.

Thanks, Ross, and good morning. We finished 2021 with strong fourth quarter results produced from increased occupancy, strong same-site NOI growth, further improvement in collections and credit loss and a full quarter of better-than-expected contribution from the Weingarten acquisition. For the fourth quarter, NAREIT FFO was $240.1 million or $0.39 per diluted share, and includes $3 million of income or about $0.01 per diluted share related to the valuation adjustment of the Weingarten pension plan. Excluding the pension valuation adjustment, NAREIT FFO would have been $0.38 per diluted share. Either way, this compares favorably to the $133 million or $0.31 per diluted share reported for NAREIT FFO for the fourth quarter of 2020. The increase in FFO was primarily driven by higher NOI of $124.2 million, of which the Weingarten acquisition contributed $91 million. In addition, NOI benefited from improvements in credit loss, abatements, and straight-line rent reserves of $28 million compared to the fourth quarter last year. Higher cash collections returning to pre-pandemic levels were the primary driver, including $7.8 million from cash basis accounts receivable, which were previously reserved. FFO was impacted by higher interest expense of $11.6 million, resulting from the $1.8 billion of debt assumed with the Weingarten acquisition. In addition, G&A expense was higher due to increased staffing levels to support the Weingarten portfolio and higher bonus accrual based on the Company’s operating performance as compared to the fourth quarter last year. We collected 79% of rents due from cash basis tenants for the fourth quarter of 2021. Our cash basis tenants now comprise only 6.8% of annualized base rents, down from the 9.1% at the end of the third quarter. The operating portfolio continues to deliver strong results with same-site NOI growth of 12.9% for the fourth quarter of 2021, inclusive of the Weingarten sites for the first time. The primary drivers of the same-site NOI growth were higher minimum rents contributing 3.4% and improved credit loss and lower abatements, adding 9.4%. In addition, redevelopment sites provided an additional 50 basis points. Turning to the balance sheet. We ended 2021 with a very strong liquidity position, comprised of over $330 million in cash and full availability of our $2 billion revolving credit facility. In addition, our marketable securities investment in Albertsons was valued at over $1.1 billion and all restrictions are scheduled to expire in June of this year. As of year-end 2021, our consolidated net debt to EBITDA was 6.1 times, and on a look-through basis, including our pro rata share of joint venture debt and perpetual preferred stock outstanding was 6.6 times, the lowest reported level since the company began disclosing this metric in 2009. On a pro forma basis, if the Albertsons investment were converted to cash, these metrics would improve by 0.7 times, bringing look-through net debt-to-EBITDA below six times. Now for our 2022 outlook. While the pandemic and its effects on certain of our tenants continue, we are in a much better position than a year ago, given our strong balance sheet and highly diversified and well-located open-air shopping center portfolio. Consumers continue to frequent our high-quality centers, which offer necessity-based everyday goods and services. Our initial 2022 NAREIT FFO per share guidance range is $1.46 to $1.50. The guidance range is based on the following assumptions: same-property NOI growth will be positive. Please keep in mind the robust comps we will have for the last three quarters of 2022 are against varying levels of significant improvement in credit loss during the same period in 2021. A normalized credit loss for 2022 of 100 basis points or approximately $18 million. No additional income from the collection of prior period accounts receivable attributable to cash basis tenants or reinstatement of straight-line rent receivables. No redemption charges or prepayment charges associated with callable preferred stock outstanding or early repayment of debt obligations. No monetization of Albertsons shares, but inclusive of the expected dividends from the investment. Total real estate acquisitions net of dispositions of $100 million, subject to timing. Annual G&A expenses of approximately $105 million to $112 million, with the first quarter being higher due to the timing of annual equity awards. Annual financing expenses of $248 million to $258 million from debt and perpetual preferred stock outstanding and no issuance of common equity. Based on our expected performance during 2022, the Board has raised a quarterly cash dividend on the common stock to $0.19 per share representing an 11.8% increase. This dividend level is based on anticipated REIT taxable income for 2022 and represents an FFO payout ratio in the low 50% area, based on our 2022 NAREIT FFO guidance range. Looking back, 2021 was an incredibly successful year despite the ongoing pandemic. We fully integrated the $6 billion Weingarten portfolio, successfully onboarded close to 100 associates, improved occupancy levels, produced positive leasing spreads all year, and made significant progress on our leverage metrics. There is a lot to be proud of, and we thank the entire Kimco team for all their hard work and commitment. We look forward to another successful year in 2022. And with that, we are ready to take your questions.

In terms of the Q&A, we have a pretty decent lineup today. To make an efficient process, I encourage you to just ask one question with an appropriate follow-up and then you are more than welcome to rejoin the queue. Andrew, you could take the first caller.

The first questioner is Rich Hill from Morgan Stanley. Please go ahead.

Hey, good morning, guys. I wanted to just come back to the guide for a little bit and talk about the same-store NOI guide of being positive. I think that is well below maybe some of the expectations and even some of the long-term forecast that you had put out. And so while I appreciate the desire to be conservative and I do appreciate the tough comps comment, maybe you can just elaborate on that a little bit more and help us unpack it and maybe provide a little bit more of a bridge.

Sure, Rich. It is Glenn. Hey, how are you doing? Again, we do expect it to be positive for the full year. But as we have talked about, the metric itself is a little bit tough because of all the noise that is in the credit loss aspect of it, between reserves, straight-line rents coming back. So you have that. So it is a challenge to really pinpoint a really specific range. If you took all the credit loss out on both sides of it, same-site NOI growth would be somewhere close to the 3% range. That will give you a feel for where it is, but to pinpoint a specific range today, it is just very challenging. However, we are comfortable and confident that it will be positive this year.

Okay. That is helpful. I appreciate that. And just one more follow-up regarding the guide. I noted that you are not including Albertsons in it, which I understand. And I also understand that Albertsons monetization wouldn’t go into FFO. But given where your net debt-to-EBITDA is, maybe, Conor, this is a question for you, what would you do with the monetization? It sounds like the buying assets is really competitive right now, your debt levels are at a good level. When you think about deploying that capital and recognize you want to maintain maximum flexibility, could you maybe just walk through the capital allocation process?

Sure. Thanks, Rich, for the question. The beauty of the Albertsons investment gives us a menu of different options to utilize that capital. We do have two bonds actually coming due this year. We have two callable preferreds. So that is obviously a piece of the menu. We do have some opportunities on external growth, as Ross outlined in his script. We like our strategy there of looking at buying out joint venture partners, looking at core properties as well as the mezz and pref investments that we have been making. We have a lot of leasing and redevelopment spend to do. There is no doubt about it. You have seen the uptick in the leasing volumes, and that continues to be wind at our back and say, I think we are really in the sweet spot in terms of last mile retail and where retailers want to invest not only in the existing store fleet but in net new stores. So we have got a great menu of options. We will continue to see as the year progresses how that Albertsons investment continues to perform. But we feel very fortunate to have that as an additional almost free equity raise that we will look to deploy that really.

The next question comes from Michael Goldsmith with UBS. Please go ahead.

Good morning. Thanks a lot for taking my questions. A really nice acceleration on the re-leasing spread, and that was both on the new leases and renewals. Can you walk through what is driving the gains, were they broad-based, were they concentrated in certain markets like anything to dig into where the strength is coming from would be really helpful.

Sure. Yes. This is Dave Jamieson. It is broad-based, but I would say that the majority of our leases executed in 2021 came from the Sunbelt and coastal markets. That is a substantial majority of our portfolio at this point. So when you look at geographic concentration, that is where we are seeing a significant uptick in activity. In terms of our ability to push rents, you have seen it through the course of this year, you have no new supply from development that has come online, you have this COVID inventory that is getting absorbed relatively quickly as a result of what Conor mentioned, the value of last mile distribution and the utility of brick-and-mortar retail has really come into its own through the pandemic. And so you have these demand drivers that are pushing it with muted supply that is helping us push rents further north. So we are very encouraged by the spreads this quarter. I always say the spreads are lumpy. It is all about the deals that qualify as comp deals in any given quarter. So it does go up. It does go down. But when I look at the net effect of rents, it is really what we are focused on because that factors in costs as well. We are up over 9% when we look at our trailing four quarters in Q4, and we were up at 12% year-over-year. So that, to me, is a better indicator where we are going because that is factoring in the cost as well.

That is really helpful. And as a relevant follow-up, as we think about the drivers of leasing, can we hit the point where the pent-up demand has dried up and what is left is, I don’t know, like good old-fashioned underlying demand rather than a catch-up that we had kind of been seeing in the past?

No, I think you still have pent-up demand that is flushing through the system. But more importantly, it is retailers redefining their strategy and how to utilize brick-and-mortar. And you have some of the leaders like Target who have been at the forefront for years now continuing to find ways to repurpose their small format as well as their full-sized store. They are continuing to make investments to test how they can better connect with the customer. I think you are then starting to see that trickle down into other national, regional and local players. You are seeing digitally native brands come into the market appreciating that brick-and-mortar has value. The margins are better on distribution to the customers. So you are seeing this somewhat reinvention of how people are utilizing the box, like for fulfillment within the store is becoming a component. When you look at the grocery stores, carving out 10,000 to 15,000 square feet of their box and/or leasing adjacent space to accommodate this new use. So you are beyond just the pent-up demand, which still takes time to absorb. You are seeing new utility for the box and the shopping center, which I think is really encouraging as we move into what I consider the next iteration of the open-air sector.

Yes. Just one thing to add on that, if you watch our retailers, and I anticipate this to occur not just this quarter but for the next few quarters, you will see a capital allocation shift really towards last mile retail. And I think that is where you are going to start to see significant dollars being invested in existing stores because they are hard to replace as well as new net stores. And I think that is going to be a big shift from prior years where they were probably more focused on the e-commerce platform and are now really starting to shift more of the additional dollars towards that last mile retail.

The next question comes from Samir Khanal with Evercore ISI. Please go ahead.

Hey, good morning, everybody. So Conor, I just wanted to kind of dig a little bit more into this guidance here. I guess what are you assuming from Weingarten? I know we have talked about the overhead savings before, but I’m just trying to understand in terms of additional opportunities, the margins that from Weingarten’s perspective, I remember at that time, their occupancy rate was probably about 100 basis points lower. Just trying to see what is baked in the guidance. What are the opportunities that exist there in the portfolio today?

Yes. Good question. So the Weingarten portfolio did have lower occupancy when we announced the deal. Within the timeframe by the time we announced it when we closed, the occupancy actually caught up to Kimco’s occupancy level. So we are sort of in tandem now as we go forward. The nice part about, as Dave mentioned on the demand side of it, the leasing is robust across the Sunbelt and the coastal markets. And we continue to lean into our strategy there of portfolio reviews using our size and scale, using our ability to tap our network for new concepts, and continue to think that, that is really going to be the driving force of the earnings growth going forward. There will be some synergy savings, as I mentioned in my script, going forward, that are above our targeted range that we are mining for. We have been very focused on the integration. We have hit the ground running. As you have seen with our results, there hasn’t been any sort of bubble of any type to like where we hit a pause. We have hit the ground running and think that there is more opportunities on the redevelopment side. We focused on entitlements on their major mixed-use projects as well. Ross mentioned buying out the JV partner and the mixed-use asset near our Pentagon project, so we have a nice cluster there of mixed-use assets that continue to define our strategy in the D.C. market. So there are a number of different levers to pull for growth from the Weingarten portfolio. First and foremost is the leasing side of it. Second is obviously the redevelopment side of it and then the JV buyouts, as I mentioned before. So it is a nice menu of options to help our growth profile going forward. And obviously, the Sunbelt continues to shine.

The next question comes from Craig Schmidt with Bank of America. Please go ahead.

Thank you. The off-price category seems particularly aggressive in terms of store opening. I think between TJX, Ross, and Burlington, they plan on opening over 350 stores. I wonder if you could tell us how many of these stores are entering into the Kimco portfolio in 2022?

Yes. So off-price combined with some dollar stores actually represented in 2021, almost 25% of the deal flow. So you are seeing a substantial voice from the off-price category. And I would anticipate that that demand will continue through 2022. TJ has multiple brands, all of which they are pushing. They have been really encouraged by the signs that they saw through the pandemic. T.J. Maxx, Marshalls, HomeGoods, HomeSense is now expanding to new markets, they are trading as well. So they see a lot of runway and a lot of white space that they can fill and also greater density and pockets of concentration to grab market share. Same with Burlington. Burlington continues to modify their footprint. They are becoming much more efficient in the utility of the box. So it gives them more flexibility to penetrate markets that may otherwise not have been available to them in the past. So I think you are going to continue to see them grab market share where they can, appreciating that they really are in the sweet spot. People love the treasure hunt, price point is appropriate, they have goods and services, they have a good supply chain, and merchandise mix. So they are in a good position right now.

Yes. And Kimco has been trying to add grocers to the portfolio, can you give us an update on the number of grocers you have been able to add?

Yes. We did eight grocery deals in 2021, and we converted a couple of those non-grocery centers into grocery-anchored centers. In terms of the grocery demand, it really is across the board as well. Sprouts is expanding, you have fresh market expanding. You have New Seasons in Pacific Northwest looking to do new deals. You have Aldi, on more the value-oriented side expanding. So grocers have appreciated that, obviously, they were in vogue during the pandemic. They are continuing able to retain customers, to some of Conor’s earlier point, about the change in behavior with this hybrid work-from-home, go-to-work structure now, it does increase maybe our shops one time a week, one more meal at home. That has a material impact when you scale it across the country. So I think you will continue to see that expand through. And obviously, Amazon and their grocery initiative as well is fairly aggressive.

The next question comes from Juan Sanabria with BMO. Please go ahead.

Hi, good morning, thanks for the time. Just hoping you could talk a little bit about expectations or range of expectations underlying the guidance for both occupancy and spread, the cadence and/or trends from 2021 into 2022. And how you think we should be looking at that given a robust environment to start the year?

So occupancy, we try to look back to look forward. And when we look back in the Great Recession, we had noticed around a 10 to 30 basis point gain quarter-over-quarter on the recovery rate. Obviously, this last year, we had about a 50 basis point gain on the recovery year-over-year. In 2021, we are going to hold within that range of that 10 to 30. It can be lumpy at times. Obviously, historically been a little more muted as it is always the jingle mill, you get back post-holiday. So you would have to manage that. And then as you play it out through the course of the year, that is sort of where we are seeing it today. But demand is strong, as we have already talked about.

Any color on spreads?

Spreads, again, I mentioned it before, spreads are lumpy. It really depends on what falls into that category on a quarterly basis. What I would say is when you look at our 2022 and 2023 anchor rollover schedule, it is about $12 a foot in rent. Our average ABR on anchor signed last year was $17. So you have a nice window there to continue to see growth in the rents. And again, we are highly focused on NER, and that is where we are seeing some encouraging times as well.

Yes, I would just add, we still, as a portfolio, have a large amount of below-market rents. So as those come due, they add pretty considerably to the portfolio. But to Dave’s point, they are lumpy.

And then just my last question, just on the joint venture buyouts and/or sales, any quantum you can give us in terms of the potential opportunity for how you guys are thinking about it on both the acquisition and/or sales side? It seems you kind of hinted at some dispositions here in the first half of the year particularly on that. Any color around size and/or pricing around those potential transactions?

Yes. I mean it is a little bit difficult to predict. We keep in very close contact with each and every one of our partners, and they all have varying degrees of views on time horizon on their investment strategy. So we are having active conversations with several. We don’t know necessarily which ones will hit this year or next year or even five years into the future. So we try to maintain a pretty conservative view on our acquisition and disposition guidance. But what I can tell you is that several partners are active today. As I mentioned, we have sold a couple of joint venture minority interests that we own in the fourth quarter and already here in the first quarter thus far, and we do anticipate a few more on both the acquisition and disposition side. So we will update you as the year progresses in terms of what the volume is, but there are substantial active conversations ongoing.

The next question comes from Caitlin Burrows with Goldman Sachs. Please go ahead.

Hi, good morning. Maybe just a question back on the credit loss. So guidance is assuming a headwind of 100 basis points. Can you go through how this would compare to pre-pandemic years? And to what extent this is based on specific tenants that you have concern about versus a more general unknown bucket?

Caitlin, I mean, again, credit loss, if you look pre-pandemic, we were in a range of somewhere in the 75 to 85 basis points in a given year. Again, very hard to predict early on, so we take an approach of 100 basis points in our guidance. And then obviously, we will report quarter-by-quarter. But we think it is a good starting point. And we do feel pretty good about where the collection levels are because they are back to more pre-pandemic levels. And I would say the tenant base is certainly very, very strong today. The pandemic was able to - you have a lot of tenants that went away that probably needed to go away. And the team has just done a great job replacing that, and you have uplift coming certainly from the occupancy side from the low that we hit. So we think that is really the right starting point.

Okay. Got it. And then maybe just one back to Albertsons. I was wondering if you could go through what the kind of FFO tax implications could be when there is a monetization. As in given the time you have waited, to what extent are you able to manage and avoid a more significant impact or not?

That is a great question. I think as I mentioned previously, in any given year, the way the investments held today, we could sell and absorb a gain in the REIT of around $350 million. And we could do that to stay a REIT. The key there is the gross receipts test, the 75% gross receipt test. So if you look at the overall gross receipts of the company today it is somewhere in that $1.7 billion, $1.8 billion range, we could do around $350 million of gain, and we would be fine. From an FFO standpoint, again, we are not including gains on marketable securities and FFO. So it is not an FFO issue, but obviously the cash would come in and how we utilize that cash would have some impact on FFO. Bear in mind that whatever we sell, the dividend that we are earning, which is baked in the guidance would fall away. So we have room. Again, we also have strategies that if something was larger, we can move part of the investment back into a TRS. That has other tax implications. So we are going to monitor the investment and try and be as opportunistic as we can and monetize it over time.

Next question comes from Greg McGinniss with Scotiabank. Please go ahead.

Hey, good morning. I was hoping to talk about the development pipeline just for a moment, which kind of appears to be going down quarter-over-quarter as you continue to deliver projects. But has that become a less important aspect to the growth story relative to external growth or how should we think about the potential for adding projects, especially given the mixed-use entitlements you already have?

Yes. It is a great question, obviously accurate observation. I would say where you are seeing the strategic shift on our investment on the development and redevelopment side is less of an influence on a go-forward basis on ground-up development and more of an emphasis on redevelopment. Redevelopment broken into two distinct categories. The first one being our core retail redevelopments. It has been part of our DNA for the last 10, 15 years, and that is really the repositioning of retail within the center, adding of outparcels; anchor repositionings, which are a very big focus of ours right now coming out of COVID and backbone space. And the second part of that is the activation of our entitlements to the mixed-use pipeline. So as you can see in the SEP, we obviously have The Milton that is currently under construction, Phase II of the Pentagon Centre, which is across the Amazon HQ campus in Arlington, Virginia. In addition to that, though, we do have a couple of ground leases, one in Camino Square, which is in South Florida; as well as the Avery Tower 2, which is part of the Dania Pointe project, that is another 600 or so residential units. So we almost have about 1,000 units under construction, either through our joint venture structure at the Pentagon or a rounded structure. We will continue to focus on the opportunity to activate some of those entitled projects in the future. The time and how the structure is, will be sort of condition on the market and what we see as the most opportunistic way to proceed. So that is definitely where we are going to apply our focus going forward.

So is there any level of guidance you can give on kind of expected pipeline size in terms of future development or future spends that expected to stay around the same level and just recycle as you finish up assets? Or do we expect some growth in the level of pipeline size income and spend each year?

I would say, from a future spend standpoint, somewhere between $100 million and $125 million a year on redevelopment is what we have baked into our plan. So pretty similar to what you have seen previously. But again, we are going to be very methodical and disciplined about how we start executing on those projects.

The next question comes from Katie McConnell with Citi. Please go ahead.

It is Michael Bilerman here with Katie. Maybe Glenn sticking with you, I just wanted to circle back on the guidance just to make sure that we all have it correctly. Coming out of the fourth quarter, I think you said the $0.39 was really $0.38 when you adjust for the Weingarten benefit on the G&A, so call it about $1.52 going to next year. It appears this credit loss reserve, obviously, you had a benefit in the fourth quarter, which probably added $0.01 to $0.015. So maybe the run rate is $36.5, which is effectively the low end of your guidance. And so I guess I’m struggling a little bit to sort of comprehend the $1.46 to $1.50 and why that really shouldn’t be up towards $1.50 to $1.54.

So Michael, I guess he was sitting in the room with me when we were doing guidance because your math is pretty accurate. Again, you hit on the points that are important, right? The Weingarten pension accrual is a one-time thing. So again, that is why we have pointed it out. So you do need to pull that roughly penny out for that. About $7.8 million of collections of prior period cash basis tenants that came during the quarter. So again, in our guidance, as I mentioned, that is not in there. So to the extent that we collect some of that, you are right, there is some room for upside and your run rate is kind of where you are at. That is right too. This is where we are going to start out. We feel good about where things are. We have put credit loss back in, which is a pretty significant number. We are using $18 million of credit loss in the numbers for this year, where we had, net-net, about $7 million of income. So year-over-year, you are looking at like a $25 million swing, which is $0.04 or $0.05. So that is kind of the math. As we will go forward, we will see where things fall out and we will make adjustments accordingly.

Yes, Michael, just remember, we are still in the midst of the pandemic, and we felt like this was the appropriate starting spot. Now as you have seen before, it is not how you start, it is how you finish. And so I think we are focused on that. And we feel like as we would sit in still in the midst of a pandemic, we feel like it is a good starting spot.

So it sounds like there is nothing else other than this credit loss of 100 basis points that obviously would be probably an incremental drag relative to where Street estimates are probably in the range of at least $0.02 to $0.03 relative to probably what people were expecting. Is there anything else in your numbers that is acting as a negative surprise or conversely, are there things out there other than credit loss that could be a positive surprise? I’m just trying to make sure that there is nothing else that we are missing in the numbers.

I think there is a couple of things. I mean we are early on in the year. We have talked about the fact that there is a fair amount of refinancing that needs to be done. So depending on where interest rates are at the time we do it, that could have some level of impact on where everything falls out and where things go forward. And again, Albertsons, again, is not really baked into the numbers at this point. So anything that happens there has some impact as well. So again, it is early on. We tried to lay out all the pieces of the way we are thinking about it. And again, as we move along through the year, we will continue to update it.

It is Katy. Just wanted to go back to capital allocation again, the acquisition guidance is pretty light to start. I’m just wondering how much you think you could potentially allocate this year to debt or preferred pay down as opposed to refinancing for your upcoming maturities.

So our capital plan is to really refinance obviously, the bonds that we have. The company today is forecasted to generate around $200 million of free cash flow after dividends. I mean, again, cash is fungible. But to the extent that the plan ran exactly as is, we would expect that for the most part, we could use a good portion of that cash towards debt - again, it is fungible, but towards debt repayment. So overall, again, depending on how the whole year goes, you are not expecting debt levels, absolute debt levels really. I think I just want to add one other point again, just back to Michael a little bit. I think I have said in my prepared remarks, there are no charges baked into this plan or the redemption of preferreds or any prepayment charges related around your debt. Should any of that occur, obviously we will make adjustments to the headline FFO guidance, but that is not incorporated in the plan today.

And is the refinancing and the accretion or dilution embedded in the numbers I mean do you have anything from the net effect of it, forget about the charges for a second?

Yes. Yes, we do. There is a modest amount that is baked into it. But remember, most of it is later in the year. So the first preferred is callable until middle of August, and the second preferred isn’t callable until December 20. So you are going to have very little impact for 2022 as it relates to that. The bonds don’t mature until October 15th and November 1st. So a similar situation where the refinancing of those items is really late in the year. So it is more of a - we will get to it later, but it is more of a 2023 impact, and we will see where the refinancings of those occur at the time.

Just two quick ones. Sorry about that. Looking at the rent collections that fell slightly from last quarter, is there anything to read into that, perhaps highlighting some weaker tenants start to fall out before occupancy recovers or is that just a year and timing issue?

So what you are seeing there, Greg, is actually there is some significant billings that go out in the fourth quarter related to our real estate taxes. And those aren’t like your contractual rents where it is every month, no number. So when those go out, it takes a little bit longer to collect those. So that is what is just causing that relative small dip, but those collections will pick up in the first quarter related to those real estate taxes.

Okay. And then at NAREIT last year, you mentioned true rent growth versus 2019 was limited to certain Sunbelt markets. Is that still true where you are starting to see improvement in other regions as well? So any details you can provide on market rent growth would be appreciated.

Yes, no. I mean, again, when you look at the net effective rents spreads that were posted, the volume of activity between our coastal and Sunbelt markets, which represents over 94% of deal flow, we are seeing market rents move north in almost every case at this point. So it really has spread balance throughout the country and I think that is a result of several items we talked about before, obviously, no development supply, open inventory getting absorbed relatively quickly, retailers fully appreciating the value of open air and wanting to grab market share and/or expand their growth in open air that otherwise may have been a little bit muted in the past. And so I think when you combine those all, that is putting some nice demand for us in our favor that we can get to.

Yes, Greg, that is another tool that we use, right, with data analytics to give us sort of an advantage, I would say, in capital allocation to understand maybe where the market has yet to reflect some of the pricing power that we see. Obviously, Sunbelt gets a lot of airtime. And clearly, there is a lot of rent growth going on down there. But there are other markets where we see rent growth that potentially is not yet reflected in pricing that we continue to manage up.

And the final question today comes from Katy McConnell with Citi. Please go ahead.

It is Michael Bilerman. Page 28 in the supplemental where you broke out all the It is pretty comprehensive. How does that tie to Page 26 and then ultimately, Page 43, where you sort of value the entitlements today at least that are active and so Page 26 and Page 43 have it at about 4,400 units and keys, whereas Page 28 only breaks up the entitlement at that 3,400. So I don’t know where those other 1,000 units are coming from, maybe that is some that are undergoing entitlement that have more of certainty. Can you just reconcile that?

Yes, yes. There is two parts to it. So one of which I actually mentioned earlier, where you have the Camino Square and you have the Avery Part 2, which is over 600 entitled units that are actually - our spend is fully completed, so you won’t see it reflected in the active mixed-use stage, which is just in Milton right now. But those are accounting for a portion of that delta and then the other ones that are undergoing entitlements that wouldn’t necessarily be reflected on that page. But that is effectively where you are getting the tie out.

Those are ground leases, Michael. So that is why our spend is like pad prep and then it is over. So that is why you don’t see that.

And what is the potential that some of these projects get launched this year so that when we look at Page 26, your sort of active mixed-use starts to grow?

Yes. So I mean, we are evaluating - when you look at the entitled product, actually, you go to Page 28. So when you look at the 11 entitled projects that are on the pipeline there, there are two that are referenced that currently have ground leases in place that are pending permit approval from the developers. So those could be opportunities to activate. In addition to that, we are evaluating probably three to five of those. And again, everything I had mentioned before, market conditions, capital but it is something that we are wanting to pursue.

And all the spend that you have in pursuing entitlements, all that is being capitalized now and is there a certain balance of capitalized costs for these projects?

Yes. I mean the capital that we are spending on those projects is definitely capitalized. It goes into the building basis for the asset.

We are trying to have a balanced Michael of how much we activate and how much we activate using ground leases as well as bringing in sort of a world-class multifamily developer, because we have seen that it is a nice have too much capital going into these projects, where we can continue to focus on FFO growth. It activates more mixed-use opportunities without having the drag of these - these are lower-return projects. So the ground probably set these projects up for future generations to collapse the ownership and have Kimco shareholders benefit from it long-term.

Great. See you in a few weeks.

I just want to thank everybody that participated on our call today, and we hope you enjoy the rest of your day. Thank you.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.