Equibles

10-Q

KIMCO REALTY CORP (KIM)

10-Q 2025-08-01 For: 2025-06-30
View Original
Added on April 06, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________to_________

Commission File Number:

1-10899

(Kimco Realty Corporation) Commission File Number:

333-269102-01

(Kimco Realty OP, LLC)

KIMCO REALTY CORPORATION

KIMCO REALTY OP, LLC

(Exact name of registrant as specified in its charter)

Maryland (Kimco Realty Corporation)<br><br>Delaware (Kimco Realty OP, LLC) 13-2744380<br><br>92-1489725
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

500 North Broadway, Suite 201, Jericho, NY 11753

(Address of principal executive offices) (Zip Code)

(516) 869-9000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year,

if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Kimco Realty Corporation

Title of each class Trading<br><br>Symbol(s) Name of each exchange on<br><br>which registered
Common Stock, par value $.01 per share. KIM New York Stock Exchange
Depositary Shares, each representing one one-thousandth of a share of 5.125% Class L Cumulative Redeemable, Preferred Stock, $1.00 par value per share. KIMprL New York Stock Exchange
Depositary Shares, each representing one one-thousandth of a share of 5.250% Class M Cumulative Redeemable, Preferred Stock, $1.00 par value per share. KIMprM New York Stock Exchange
Depositary Shares, each representing one one-thousandth of a share of 7.250% Class N Cumulative Convertible Preferred Stock, $1.00 par value per share. KIMprN New York Stock Exchange

Kimco Realty OP, LLC

Title of each class Trading<br><br>Symbol(s) Name of each exchange on<br><br>which registered
None N/A N/A

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.

Kimco Realty Corporation Yes  No ☐ Kimco Realty OP, LLC Yes   No ☐

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).

Kimco Realty Corporation Yes  No ☐ Kimco Realty OP, LLC Yes   No ☐

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.

Kimco Realty Corporation:

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐
Smaller reporting company ☐ Emerging growth company ☐

Kimco Realty OP, LLC:

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒
Smaller reporting company ☐ Emerging growth company ☐

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.

Kimco Realty Corporation ☐ Kimco Realty OP, LLC ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Kimco Realty Corporation Yes ☐ No  Kimco Realty OP, LLC Yes ☐ No 

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.

As of July 22, 2025, Kimco Realty Corporation had 677,200,477 shares of common stock outstanding.

KIMCO REALTY CORPORATION

KIMCO REALTY OP, LLC

QUARTERLY REPORT ON FORM 10-Q

QUARTERLY PERIOD ENDED JUNE 30, 2025

EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the quarterly period ended June 30, 2025, of Kimco Realty Corporation (the “Parent Company”) and Kimco Realty OP, LLC (“Kimco OP”). Unless stated otherwise or the context requires, references to “Kimco Realty Corporation” or the “Parent Company” mean Kimco Realty Corporation and its subsidiaries, and references to “Kimco Realty OP, LLC” or “Kimco OP” mean Kimco Realty OP, LLC and its subsidiaries. The terms the “Company,” “we,” “our” or “us” refer to the Parent Company and its business and operations conducted through its directly or indirectly owned subsidiaries, including Kimco OP; and in statements regarding qualification as a Real Estate Investment Trust ("REIT"), such terms refer solely to the Parent Company. References to “shares” and “shareholders” refer to the shares and shareholders of the Parent Company and not the limited liability company interests of Kimco OP.

The Parent Company is a REIT and is the managing member of Kimco OP. As of June 30, 2025, the Parent Company owned 99.79% of the outstanding limited liability company interests (the "OP Units") in Kimco OP. Noncontrolling OP Unit interests are owned by third parties and certain officers and directors of the Company.

Substantially all of the Parent Company’s assets are held by, and substantially all of the Parent Company’s operations are conducted through, Kimco OP (either directly or through its subsidiaries), as the Parent Company’s operating company, and the Parent Company is the managing member of Kimco OP. In addition, the officers and directors of the Parent Company are the same as the officers and directors of Kimco OP. Management operates the Parent Company and Kimco OP as one business. The management of the Parent Company consists of the same individuals as the management of Kimco OP. These individuals are officers of the Parent Company and employees of Kimco OP.

Stockholders' equity and Members’ capital are the primary areas of difference between the unaudited Condensed Consolidated Financial Statements of the Parent Company and those of Kimco OP. Kimco OP’s capital currently includes OP Units owned by the Parent Company and noncontrolling OP Units owned by third parties and certain officers and directors of the Company. OP Units owned by outside members are accounted for within capital on Kimco OP’s financial statements and in noncontrolling interests in the Parent Company’s financial statements.

The Parent Company consolidates Kimco OP for financial reporting purposes, and the Parent Company does not have significant assets other than its investment in Kimco OP. Therefore, while stockholders’ equity, members’ capital and noncontrolling interests differ as discussed above, the assets and liabilities of the Parent Company and Kimco OP are the same on their respective financial statements.

The Company believes combining the quarterly reports on Form 10-Q of the Parent Company and Kimco OP into this single report provides the following benefits:

  • Enhances investors' understanding of the Parent Company and Kimco OP by enabling investors to view the businesses as a whole in the same manner as management views and operates the business;
  • Eliminates duplicative disclosure and provides a more concise and readable presentation because a substantial portion of the disclosure applies to both the Parent Company and Kimco OP; and
  • Creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

In order to highlight the differences between the Parent Company and Kimco OP, there are sections in this Quarterly Report that separately discuss the Parent Company and Kimco OP, including separate financial statements (but combined footnotes), separate controls and procedures sections, and separate Exhibit 31 and 32 certifications. In the sections that combine disclosure for the Parent Company and Kimco OP, unless context otherwise requires, this Quarterly Report refers to actions or holdings of the Parent Company and/or Kimco OP as being the actions or holdings of the Company (either directly or through its subsidiaries, including Kimco OP).

KIMCO REALTY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(in thousands, except share information)

December 31, 2024
Assets:
Real estate, net of accumulated depreciation and amortization of 4,585,939 and    4,360,239, respectively 16,751,461 $ 16,810,333
Investments in and advances to real estate joint ventures 1,466,874 1,487,675
Other investments 109,826 107,347
Cash, cash equivalents and restricted cash 227,826 689,731
Mortgage and other financing receivables, net 440,991 444,966
Accounts and notes receivable, net 339,351 340,469
Operating lease right-of-use assets, net 130,768 126,441
Other assets 329,458 302,934
Total assets (1) 19,796,555 $ 20,309,896
Liabilities:
Notes payable, net 7,717,229 $ 7,964,738
Mortgages payable, net 441,489 496,438
Accounts payable and accrued expenses 257,321 281,867
Dividends payable 6,364 6,409
Operating lease liabilities 122,386 117,199
Other liabilities 533,790 597,456
Total liabilities (1) 9,078,579 9,464,107
Redeemable noncontrolling interests 46,566 47,877
Commitments and Contingencies (Footnote 19)
Stockholders' equity:
Preferred stock, 1.00 par value, authorized 7,054,000 shares; Issued and   outstanding (in series) 20,748 and 20,806 shares, respectively; Aggregate liquidation   preference 553,196 and 556,113, respectively 21 21
Common stock, .01 par value, authorized 1,500,000,000 shares;    Issued and outstanding 677,205,011 and 679,493,522 shares, respectively 6,772 6,795
Paid-in capital 10,979,077 11,033,485
Cumulative distributions in excess of net income (457,405 ) (398,792 )
Accumulated other comprehensive (loss)/income (7,790 ) 11,038
Total stockholders' equity 10,520,675 10,652,547
Noncontrolling interests 150,735 145,365
Total equity 10,671,410 10,797,912
Total liabilities and equity 19,796,555 $ 20,309,896

All values are in US Dollars.

  • Total assets include restricted assets of consolidated variable interest entities (“VIEs”) at June 30, 2025 and December 31, 2024 of $330,268 and $334,859, respectively. Total liabilities include non-recourse liabilities of consolidated VIEs at June 30, 2025 and December 31, 2024 of $159,628 and $161,577, respectively. See Footnote 14 of the Notes to Condensed Consolidated Financial Statements.

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

(in thousands, except per share data)

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Revenues
Revenues from rental properties, net $ 520,930 $ 496,221 $ 1,052,216 $ 995,126
Management and other fee income 4,245 4,010 9,583 8,859
Total revenues 525,175 500,231 1,061,799 1,003,985
Operating expenses
Rent (4,242 ) (4,226 ) (8,426 ) (8,505 )
Real estate taxes (66,559 ) (66,182 ) (136,470 ) (129,542 )
Operating and maintenance (91,069 ) (87,749 ) (180,622 ) (173,523 )
General and administrative (32,447 ) (33,090 ) (66,839 ) (69,388 )
Impairment charges (7,645 ) (201 ) (8,179 ) (3,902 )
Merger charges - - - (25,246 )
Depreciation and amortization (156,323 ) (148,148 ) (314,776 ) (302,867 )
Total operating expenses (358,285 ) (339,596 ) (715,312 ) (712,973 )
Gain on sale of properties 38,922 75 39,809 393
Operating income 205,812 160,710 386,296 291,405
Other income/(expense)
Other income, net 2,903 910 3,119 10,480
Mortgage and other financing income, net 12,062 4,751 23,331 7,270
Loss on marketable securities, net (2 ) (6 ) (11 ) (27,692 )
Interest expense (81,204 ) (73,341 ) (161,581 ) (147,906 )
Income before income taxes, net, equity in income of joint ventures,<br>   net, and equity in income from other investments, net 139,571 93,024 251,154 133,557
Provision for income taxes, net (366 ) (217 ) (830 ) (72,227 )
Equity in income of joint ventures, net 23,990 21,527 46,673 42,432
Equity in income of other investments, net 1,747 7,718 2,448 9,252
Net income 164,942 122,052 299,445 113,014
Net income attributable to noncontrolling interests (1,956 ) (2,314 ) (3,642 ) (4,250 )
Net income attributable to the Company 162,986 119,738 295,803 108,764
Preferred dividends, net (7,556 ) (7,961 ) (15,239 ) (15,903 )
Net income available to the Company's common shareholders $ 155,430 $ 111,777 $ 280,564 $ 92,861
Per common share:
Net income available to the Company's common shareholders:
-Basic $ 0.23 $ 0.17 $ 0.41 $ 0.14
-Diluted $ 0.23 $ 0.17 $ 0.41 $ 0.14
Weighted average shares:
-Basic 674,613 671,198 675,837 670,658
-Diluted 675,079 671,384 676,244 670,839

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited)

(in thousands)

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Net income $ 164,942 $ 122,052 $ 299,445 $ 113,014
Other comprehensive (loss)/income:
Change in fair value of cash flow hedges for interest payments (5,440 ) 1,361 (15,709 ) 7,820
Equity in change in fair value of cash flow hedges for interest payments <br>   of unconsolidated investees (1,439 ) (404 ) (3,119 ) 87
Other comprehensive (loss)/income (6,879 ) 957 (18,828 ) 7,907
Comprehensive income 158,063 123,009 280,617 120,921
Comprehensive income attributable to noncontrolling interests (1,956 ) (2,314 ) (3,642 ) (4,250 )
Comprehensive income attributable to the Company $ 156,107 $ 120,695 $ 276,975 $ 116,671

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(unaudited)

(in thousands)

Cumulative Accumulated
Distributions Other Total
Preferred Stock Common Stock Paid-in in Excess of Comprehensive Stockholders' Noncontrolling Total
Issued Amount Issued Amount Capital Net Income Income/(Loss) Equity Interests Equity
Balance at April 1, 2024 21 $ 21 674,118 $ 6,741 $ 10,906,300 $ (303,302 ) $ 10,279 $ 10,620,039 $ 147,817 $ 10,767,856
Net income - - - - - 119,738 - 119,738 2,314 122,052
Other comprehensive income/(loss):
Change in fair value of cash flow hedges for interest payments - - - - - - 1,361 1,361 - 1,361
Equity in change in fair value of cash flow hedges for interest <br>   payments of unconsolidated investees - - - - - - (404 ) (404 ) - (404 )
Redeemable noncontrolling interests income - - - - - - - - (1,145 ) (1,145 )
Dividends declared to preferred shares - - - - - (7,961 ) - (7,961 ) - (7,961 )
Dividends declared to common shares - - - - - (161,785 ) - (161,785 ) - (161,785 )
Distributions to noncontrolling interests - - - - - - - - (1,581 ) (1,581 )
Surrender of restricted common stock - - (6 ) - (35 ) - - (35 ) - (35 )
Amortization of equity awards - - - - 7,819 - - 7,819 433 8,252
Redemption/conversion of noncontrolling interests - - - - - - - - (3 ) (3 )
Balance at June 30, 2024 21 $ 21 674,112 $ 6,741 $ 10,914,084 $ (353,310 ) $ 11,236 $ 10,578,772 $ 147,835 $ 10,726,607
Balance at April 1, 2025 21 $ 21 679,497 $ 6,795 $ 11,025,904 $ (443,533 ) $ (911 ) $ 10,588,276 $ 145,701 $ 10,733,977
Net income - - - - - 162,986 - 162,986 1,956 164,942
Other comprehensive loss:
Change in fair value of cash flow hedges for interest payments - - - - - - (5,440 ) (5,440 ) - (5,440 )
Equity in change in fair value of cash flow hedges for interest<br>   payments of unconsolidated investees - - - - - - (1,439 ) (1,439 ) - (1,439 )
Redeemable noncontrolling interests income - - - - - - - - (656 ) (656 )
Dividends declared to preferred shares - - - - - (7,538 ) - (7,538 ) - (7,538 )
Dividends declared to common shares - - - - - (169,302 ) - (169,302 ) - (169,302 )
Repurchase of preferred stock - - - - (645 ) (18 ) - (663 ) - (663 )
Distributions to noncontrolling interests - - - - - - - - (1,623 ) (1,623 )
Issuance of equity awards, net - - 716 7 2,098 - - 2,105 4,320 6,425
Repurchase of common stock - - (3,000 ) (30 ) (58,814 ) - - (58,844 ) - (58,844 )
Surrender of restricted common stock - - (8 ) - (110 ) - - (110 ) - (110 )
Amortization of equity awards - - - - 10,666 - - 10,666 959 11,625
Redemption/conversion of noncontrolling interests - - - - (78 ) - - (78 ) 78 -
Adjustment of redeemable noncontrolling interests to<br>   estimated fair value - - - - 56 - - 56 - 56
Balance at June 30, 2025 21 $ 21 677,205 $ 6,772 $ 10,979,077 $ (457,405 ) $ (7,790 ) $ 10,520,675 $ 150,735 $ 10,671,410

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(unaudited)

(in thousands)

Cumulative Accumulated
Distributions Other Total
Preferred Stock Common Stock Paid-in in Excess of Comprehensive Stockholders' Noncontrolling Total
Issued Amount Issued Amount Capital Net Income Income/(Loss) Equity Interests Equity
Balance at January 1, 2024 19 $ 19 619,871 $ 6,199 $ 9,638,494 $ (122,576 ) $ 3,329 $ 9,525,465 $ 127,993 $ 9,653,458
Net income - - - - - 108,764 - 108,764 4,250 113,014
Other comprehensive income:
Change in fair value of cash flow hedges for interest payments - - - - - - 7,820 7,820 - 7,820
Equity in change in fair value of cash flow hedges for interest <br>   payments of unconsolidated investees - - - - - - 87 87 - 87
Redeemable noncontrolling interests income - - - - - - - - (2,282 ) (2,282 )
Dividends declared to preferred shares - - - - - (15,921 ) - (15,921 ) - (15,921 )
Dividends declared to common shares - - - - - (323,577 ) - (323,577 ) - (323,577 )
Distributions to noncontrolling interests - - - - - - - - (3,341 ) (3,341 )
Issuance of preferred stock for merger (1) 2 2 - - 105,605 - - 105,607 - 105,607
Issuance of common stock for merger (1) - - 53,034 530 1,166,234 - - 1,166,764 - 1,166,764
Issuance of common stock - - 1,967 20 (20 ) - - - - -
Noncontrolling interests assumed from the merger (1) - - - - - - - - 20,975 20,975
Surrender of restricted common stock - - (760 ) (8 ) (14,686 ) - - (14,694 ) - (14,694 )
Amortization of equity awards - - - - 17,498 - - 17,498 824 18,322
Redemption/conversion of noncontrolling interests - - - - (18 ) - - (18 ) (584 ) (602 )
Adjustment of redeemable noncontrolling interests to<br>   estimated fair value - - - - 977 - - 977 - 977
Balance at June 30, 2024 21 $ 21 674,112 $ 6,741 $ 10,914,084 $ (353,310 ) $ 11,236 $ 10,578,772 $ 147,835 $ 10,726,607
Balance at January 1, 2025 21 $ 21 679,494 $ 6,795 $ 11,033,485 $ (398,792 ) $ 11,038 $ 10,652,547 $ 145,365 $ 10,797,912
Net income - - - - - 295,803 - 295,803 3,642 299,445
Other comprehensive loss:
Change in fair value of cash flow hedges for interest payments - - - - - - (15,709 ) (15,709 ) - (15,709 )
Equity in change in fair value of cash flow hedges for interest<br>   payments of unconsolidated investees - - - - - - (3,119 ) (3,119 ) - (3,119 )
Redeemable noncontrolling interests income - - - - - - - - (1,469 ) (1,469 )
Dividends declared to preferred shares - - - - - (15,091 ) - (15,091 ) - (15,091 )
Dividends declared to common shares - - - - - (339,177 ) - (339,177 ) - (339,177 )
Repurchase of preferred stock - - - - (3,332 ) (148 ) - (3,480 ) - (3,480 )
Distributions to noncontrolling interests - - - - - - - - (2,819 ) (2,819 )
Issuance of equity awards, net - - 1,241 12 2,093 - - 2,105 4,320 6,425
Repurchase of common stock - - (3,000 ) (30 ) (58,814 ) - - (58,844 ) - (58,844 )
Surrender of restricted common stock - - (530 ) (5 ) (11,641 ) - - (11,646 ) - (11,646 )
Amortization of equity awards - - - - 16,731 - - 16,731 1,618 18,349
Redemption/conversion of noncontrolling interests - - - - (78 ) - - (78 ) 78 -
Adjustment of redeemable noncontrolling interests to<br>   estimated fair value - - - - 633 - - 633 - 633
Balance at June 30, 2025 21 $ 21 677,205 $ 6,772 $ 10,979,077 $ (457,405 ) $ (7,790 ) $ 10,520,675 $ 150,735 $ 10,671,410

(1) See Footnotes 1 and 3 of the Notes to Condensed Consolidated Financial Statements for further details.

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(in thousands)

Six Months Ended June 30,
2025 2024
Cash flow from operating activities:
Net income $ 299,445 $ 113,014
Adjustments to reconcile net income to net cash flow provided by operating activities:
Depreciation and amortization 314,776 302,867
Impairment charges 8,179 3,902
Straight-line rental income adjustments, net (10,564 ) (12,934 )
Amortization of above-market and below-market leases, net (12,644 ) (10,345 )
Amortization of deferred financing costs and fair value debt adjustments, net 667 (910 )
Equity award expense 18,349 18,293
Gain on sale of properties (39,809 ) (393 )
Loss on marketable securities, net 11 27,692
Change in fair value of embedded derivative liability (2,459 ) 3,079
Equity in income of joint ventures, net (46,673 ) (42,432 )
Equity in income of other investments, net (2,448 ) (9,252 )
Distributions from joint ventures and other investments 44,661 52,664
Change in accounts and notes receivable, net 11,599 29,459
Change in accounts payable and accrued expenses (25,741 ) 9,603
Change in other operating assets and liabilities, net (28,133 ) (14,157 )
Net cash flow provided by operating activities 529,216 470,150
Cash flow from investing activities:
Acquisition of operating real estate and other related net assets (106,244 ) -
Improvements to operating real estate (138,210 ) (128,594 )
Acquisition of RPT Realty - (149,103 )
Investment in marketable securities (1,003 ) (11 )
Proceeds from sale of marketable securities 500 300,763
Investments in preferred stock and cost method investments (5,361 ) (36 )
Investments in and advances to real estate joint ventures (2,909 ) (3,182 )
Reimbursements of investments in and advances to real estate joint ventures 14,186 18,159
Investments in and advances to other investments (3,012 ) (3,913 )
Reimbursements of investments in and advances to other investments 1,195 2,856
Investment in mortgage and other financing receivables (46,170 ) (178,934 )
Collection of mortgage and other financing receivables 50,144 61,122
Proceeds from sale of properties 2,119 70,341
Proceeds from insurance casualty claims 1,630 -
Net cash flow used for investing activities (233,135 ) (10,532 )
Cash flow from financing activities:
Principal payments on debt, excluding normal amortization of rental property debt (48,844 ) (11,774 )
Principal payments on rental property debt (6,200 ) (4,963 )
Proceeds from issuance of unsecured term loans - 510,000
Proceeds from issuance of unsecured notes 500,000 -
Proceeds from unsecured revolving credit facility, net - 220,000
Repayments of unsecured term loans - (310,000 )
Repayments of unsecured notes (740,505 ) (1,157,700 )
Financing origination costs (6,619 ) (1,563 )
Redemption/distribution of noncontrolling interests (5,334 ) (8,318 )
Dividends paid (354,311 ) (338,085 )
Repurchase of preferred stock (3,480 ) -
Repurchase of common stock (58,844 ) -
Shares repurchased for employee tax withholding on equity awards (11,644 ) (14,665 )
Principal payments under finance lease obligations (24,362 ) -
Change in tenants' security deposits 2,157 1,248
Net cash flow used for financing activities (757,986 ) (1,115,820 )
Net change in cash, cash equivalents and restricted cash (461,905 ) (656,202 )
Cash, cash equivalents and restricted cash, beginning of the period 689,731 783,757
Cash, cash equivalents and restricted cash, end of the period $ 227,826 $ 127,555
Interest paid (net of capitalized interest of $1,166 and $1,153, respectively) $ 167,401 $ 150,906
Income taxes paid, net of refunds $ 25,773 $ 57,805

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY OP, LLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(in thousands, except unit information)

June 30, 2025 December 31, 2024
Assets:
Real estate, net of accumulated depreciation and amortization of $4,585,939 and<br>    $4,360,239, respectively $ 16,751,461 $ 16,810,333
Investments in and advances to real estate joint ventures 1,466,874 1,487,675
Other investments 109,826 107,347
Cash, cash equivalents and restricted cash 227,826 689,731
Mortgage and other financing receivables, net 440,991 444,966
Accounts and notes receivable, net 339,351 340,469
Operating lease right-of-use assets, net 130,768 126,441
Other assets 329,458 302,934
Total assets (1) $ 19,796,555 $ 20,309,896
Liabilities:
Notes payable, net $ 7,717,229 $ 7,964,738
Mortgages payable, net 441,489 496,438
Accounts payable and accrued expenses 257,321 281,867
Dividends payable 6,364 6,409
Operating lease liabilities 122,386 117,199
Other liabilities 533,790 597,456
Total liabilities (1) 9,078,579 9,464,107
Redeemable noncontrolling interests 46,566 47,877
Commitments and Contingencies (Footnote 19)
Members' capital:
Preferred units; 20,748 and 20,806 units outstanding, respectively 546,256 549,588
General member; 677,205,011 and 679,493,522 common units outstanding,<br>   respectively 9,982,209 10,091,921
Limited members; 1,444,722 and 1,073,942 common units outstanding, <br>   respectively 28,143 22,276
Accumulated other comprehensive (loss)/income (7,790 ) 11,038
Total members' capital 10,548,818 10,674,823
Noncontrolling interests 122,592 123,089
Total capital 10,671,410 10,797,912
Total liabilities and capital $ 19,796,555 $ 20,309,896
  • Total assets include restricted assets of consolidated VIEs at June 30, 2025 and December 31, 2024 of $330,268 and $334,859, respectively. Total liabilities include non-recourse liabilities of consolidated VIEs at June 30, 2025 and December 31, 2024 of $159,628 and $161,577, respectively. See Footnote 14 of the Notes to Condensed Consolidated Financial Statements.

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY OP, LLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

(in thousands, except per unit data)

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Revenues
Revenues from rental properties, net $ 520,930 $ 496,221 $ 1,052,216 $ 995,126
Management and other fee income 4,245 4,010 9,583 8,859
Total revenues 525,175 500,231 1,061,799 1,003,985
Operating expenses
Rent (4,242 ) (4,226 ) (8,426 ) (8,505 )
Real estate taxes (66,559 ) (66,182 ) (136,470 ) (129,542 )
Operating and maintenance (91,069 ) (87,749 ) (180,622 ) (173,523 )
General and administrative (32,447 ) (33,090 ) (66,839 ) (69,388 )
Impairment charges (7,645 ) (201 ) (8,179 ) (3,902 )
Merger charges - - - (25,246 )
Depreciation and amortization (156,323 ) (148,148 ) (314,776 ) (302,867 )
Total operating expenses (358,285 ) (339,596 ) (715,312 ) (712,973 )
Gain on sale of properties 38,922 75 39,809 393
Operating income 205,812 160,710 386,296 291,405
Other income/(expense)
Other income, net 2,903 910 3,119 10,480
Mortgage and other financing income, net 12,062 4,751 23,331 7,270
Loss on marketable securities, net (2 ) (6 ) (11 ) (27,692 )
Interest expense (81,204 ) (73,341 ) (161,581 ) (147,906 )
Income before income taxes, net, equity in income of joint ventures,<br>   net, and equity in income from other investments, net 139,571 93,024 251,154 133,557
Provision for income taxes, net (366 ) (217 ) (830 ) (72,227 )
Equity in income of joint ventures, net 23,990 21,527 46,673 42,432
Equity in income of other investments, net 1,747 7,718 2,448 9,252
Net income 164,942 122,052 299,445 113,014
Net income attributable to noncontrolling interests (1,609 ) (2,123 ) (3,084 ) (4,074 )
Net income attributable to Kimco OP 163,333 119,929 296,361 108,940
Preferred distributions, net (7,556 ) (7,961 ) (15,239 ) (15,903 )
Net income available to Kimco OP's common unitholders $ 155,777 $ 111,968 $ 281,122 $ 93,037
Per common unit:
Net income available to Kimco OP's common unitholders:
-Basic $ 0.23 $ 0.16 $ 0.41 $ 0.14
-Diluted $ 0.23 $ 0.16 $ 0.41 $ 0.14
Weighted average units:
-Basic 675,609 675,189 676,818 674,572
-Diluted 676,075 675,374 677,225 674,753

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY OP, LLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited)

(in thousands)

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Net income $ 164,942 $ 122,052 $ 299,445 $ 113,014
Other comprehensive (loss)/income:
Change in fair value of cash flow hedges for interest payments (5,440 ) 1,361 (15,709 ) 7,820
Equity in change in fair value of cash flow hedges for interest payments <br>   of unconsolidated investees (1,439 ) (404 ) (3,119 ) 87
Other comprehensive (loss)/income (6,879 ) 957 (18,828 ) 7,907
Comprehensive income 158,063 123,009 280,617 120,921
Comprehensive income attributable to noncontrolling interests (1,609 ) (2,123 ) (3,084 ) (4,074 )
Comprehensive income attributable to Kimco OP $ 156,454 $ 120,886 $ 277,533 $ 116,847

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY OP, LLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL

(unaudited)

(in thousands)

Accumulated
General Member Limited Members Other Total
Preferred Units Common Units Common Units Comprehensive Members' Noncontrolling Total
Issued Amount Issued Amount Issued Amount Income/(Loss) Capital Interests Capital
Balance at April 1, 2024 21 $ 573,003 674,118 $ 10,036,757 1,074 $ 21,093 $ 10,279 $ 10,641,132 $ 126,724 $ 10,767,856
Net income - 7,961 - 111,777 - 191 - 119,929 2,123 122,052
Other comprehensive income/(loss):
Change in fair value of cash flow hedges for interest payments - - - - - - 1,361 1,361 - 1,361
Equity in change in fair value of cash flow hedges for interest <br>   payments of unconsolidated investees - - - - - - (404 ) (404 ) - (404 )
Redeemable noncontrolling interests income - - - - - - - - (1,146 ) (1,146 )
Distributions declared to preferred unitholders - (7,961 ) - - - - - (7,961 ) - (7,961 )
Distributions declared to common unitholders - - - (161,785 ) - (256 ) - (162,041 ) - (162,041 )
Distributions to noncontrolling interests - - - - - - - - (1,324 ) (1,324 )
Redemption of common units - - - - - (3 ) - (3 ) - (3 )
Surrender of restricted common units - - (6 ) (35 ) - - - (35 ) - (35 )
Amortization of equity awards - - - 7,819 - 433 - 8,252 - 8,252
Balance at June 30, 2024 21 $ 573,003 674,112 $ 9,994,533 1,074 $ 21,458 $ 11,236 $ 10,600,230 $ 126,377 $ 10,726,607
Balance at April 1, 2025 21 $ 546,901 679,497 $ 10,042,286 1,074 $ 22,877 $ (911 ) $ 10,611,153 $ 122,824 $ 10,733,977
Net income - 7,556 - 155,430 - 347 - 163,333 1,609 164,942
Other comprehensive loss:
Change in fair value of cash flow hedges for interest payments - - - - - - (5,440 ) (5,440 ) - (5,440 )
Equity in change in fair value of cash flow hedges for interest<br>   payments of unconsolidated investees - - - - - - (1,439 ) (1,439 ) - (1,439 )
Redeemable noncontrolling interests income - - - - - - - - (656 ) (656 )
Distributions declared to preferred unitholders - (7,556 ) - - - - - (7,556 ) - (7,556 )
Distributions declared to common unitholders - - - (169,284 ) - (360 ) - (169,644 ) - (169,644 )
Repurchase of preferred units - (645 ) - (18 ) - - - (663 ) - (663 )
Repurchase of common units - - (3,000 ) (58,844 ) - - - (58,844 ) - (58,844 )
Distributions to noncontrolling interests - - - - - - - - (1,263 ) (1,263 )
Issuance of equity awards, net - - 716 2,105 371 4,320 - 6,425 - 6,425
Surrender of restricted common units - - (8 ) (110 ) - - - (110 ) - (110 )
Amortization of equity awards - - - 10,666 - 959 - 11,625 - 11,625
Redemption/conversion of noncontrolling interests - - - (78 ) - - - (78 ) 78 -
Adjustment of redeemable noncontrolling interests to estimated<br>   fair value - - - 56 - - - 56 - 56
Balance at June 30, 2025 21 $ 546,256 677,205 $ 9,982,209 1,445 $ 28,143 $ (7,790 ) $ 10,548,818 $ 122,592 $ 10,671,410

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY OP, LLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL

(unaudited)

(in thousands)

Accumulated
General Member Limited Members Other Total
Preferred Units Common Units Common Units Comprehensive Members' Noncontrolling Total
Issued Amount Issued Amount Issued Amount Income/(Loss) Capital Interests Capital
Balance at January 1, 2024 19 $ 467,396 619,871 $ 9,054,740 - $ - $ 3,329 $ 9,525,465 $ 127,993 $ 9,653,458
Net income - 15,903 - 92,861 - 176 - 108,940 4,074 113,014
Other comprehensive income:
Change in fair value of cash flow hedges for interest payments - - - - - - 7,820 7,820 - 7,820
Equity in change in fair value of cash flow hedges for interest <br>   payments of unconsolidated investees - - - - - - 87 87 - 87
Redeemable noncontrolling interests income - - - - - - - - (2,283 ) (2,283 )
Distributions declared to preferred unitholders - (15,903 ) - - - - - (15,903 ) - (15,903 )
Distributions declared to common unitholders - - - (323,595 ) - (514 ) - (324,109 ) - (324,109 )
Distributions to noncontrolling interests - (2,826 ) (2,826 )
Issuance of preferred units for merger (1) 2 105,607 105,607 105,607
Issuance of common units for merger (1) 53,034 1,166,764 953 20,975 1,187,739 1,187,739
Issuance of common units - - 1,967 - 121 - - - - -
Redemption of common units - - - - - (3 ) - (3 ) - (3 )
Surrender of restricted common units - - (760 ) (14,694 ) - - - (14,694 ) - (14,694 )
Amortization of equity awards - - - 17,498 - 824 - 18,322 - 18,322
Redemption/conversion of noncontrolling interests - - - (18 ) - - - (18 ) (581 ) (599 )
Adjustment of redeemable noncontrolling interests to <br>  estimated fair value - - - 977 - - - 977 - 977
Balance at June 30, 2024 21 $ 573,003 674,112 $ 9,994,533 1,074 $ 21,458 $ 11,236 $ 10,600,230 $ 126,377 $ 10,726,607
Balance at January 1, 2025 21 $ 549,588 679,494 $ 10,091,921 1,074 $ 22,276 $ 11,038 $ 10,674,823 $ 123,089 $ 10,797,912
Net income - 15,239 - 280,564 - 558 - 296,361 3,084 299,445
Other comprehensive loss:
Change in fair value of cash flow hedges for interest payments - - - - - - (15,709 ) (15,709 ) - (15,709 )
Equity in change in fair value of cash flow hedges for interest<br>   payments of unconsolidated investees - - - - - - (3,119 ) (3,119 ) - (3,119 )
Redeemable noncontrolling interests income - - - - - - - - (1,469 ) (1,469 )
Distributions declared to preferred unitholders - (15,109 ) - - - - - (15,109 ) - (15,109 )
Distributions declared to common unitholders - - - (339,159 ) - (629 ) - (339,788 ) - (339,788 )
Repurchase of preferred units - (3,462 ) - (18 ) - - - (3,480 ) - (3,480 )
Distributions to noncontrolling interests - - - - - - - - (2,190 ) (2,190 )
Issuance of equity awards, net - - 1,241 2,105 371 4,320 - 6,425 - 6,425
Repurchase of common units - - (3,000 ) (58,844 ) - - - (58,844 ) - (58,844 )
Surrender of restricted common units - - (530 ) (11,646 ) - - - (11,646 ) - (11,646 )
Amortization of equity awards - - - 16,731 - 1,618 - 18,349 - 18,349
Redemption/conversion of noncontrolling interests - - - (78 ) - - - (78 ) 78 -
Adjustment of redeemable noncontrolling interests to <br>  estimated fair value - - - 633 - - - 633 - 633
Balance at June 30, 2025 21 $ 546,256 677,205 $ 9,982,209 1,445 $ 28,143 $ (7,790 ) $ 10,548,818 $ 122,592 $ 10,671,410
  • See Footnotes 1 and 3 of the Notes to Condensed Consolidated Financial Statements for further details.

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY OP, LLC AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(in thousands)

Six Months Ended June 30,
2025 2024
Cash flow from operating activities:
Net income $ 299,445 $ 113,014
Adjustments to reconcile net income to net cash flow provided by operating activities:
Depreciation and amortization 314,776 302,867
Impairment charges 8,179 3,902
Straight-line rental income adjustments, net (10,564 ) (12,934 )
Amortization of above-market and below-market leases, net (12,644 ) (10,345 )
Amortization of deferred financing costs and fair value debt adjustments, net 667 (910 )
Equity award expense 18,349 18,293
Gain on sale of properties (39,809 ) (393 )
Loss on marketable securities, net 11 27,692
Change in fair value of embedded derivative liability (2,459 ) 3,079
Equity in income of joint ventures, net (46,673 ) (42,432 )
Equity in income of other investments, net (2,448 ) (9,252 )
Distributions from joint ventures and other investments 44,661 52,664
Change in accounts and notes receivable, net 11,599 29,459
Change in accounts payable and accrued expenses (25,741 ) 9,603
Change in other operating assets and liabilities, net (28,133 ) (14,157 )
Net cash flow provided by operating activities 529,216 470,150
Cash flow from investing activities:
Acquisition of operating real estate and other related net assets (106,244 ) -
Improvements to operating real estate (138,210 ) (128,594 )
Acquisition of RPT Realty - (149,103 )
Investment in marketable securities (1,003 ) (11 )
Proceeds from sale of marketable securities 500 300,763
Investments in preferred stock and cost method investments (5,361 ) (36 )
Investments in and advances to real estate joint ventures (2,909 ) (3,182 )
Reimbursements of investments in and advances to real estate joint ventures 14,186 18,159
Investments in and advances to other investments (3,012 ) (3,913 )
Reimbursements of investments in and advances to other investments 1,195 2,856
Investment in mortgage and other financing receivables (46,170 ) (178,934 )
Collection of mortgage and other financing receivables 50,144 61,122
Proceeds from sale of properties 2,119 70,341
Proceeds from insurance casualty claims 1,630 -
Net cash flow used for investing activities (233,135 ) (10,532 )
Cash flow from financing activities:
Principal payments on debt, excluding normal amortization of rental property debt (48,844 ) (11,774 )
Principal payments on rental property debt (6,200 ) (4,963 )
Proceeds from issuance of unsecured term loans - 510,000
Proceeds from issuance of unsecured notes 500,000 -
Proceeds from unsecured revolving credit facility, net - 220,000
Repayments of unsecured term loans - (310,000 )
Repayments of unsecured notes (740,505 ) (1,157,700 )
Financing origination costs (6,619 ) (1,563 )
Redemption/distribution of noncontrolling interests (4,705 ) (8,318 )
Distributions paid to common and preferred unitholders (354,940 ) (338,085 )
Repurchase of preferred units (3,480 ) -
Repurchase of common units (58,844 ) -
Units repurchased for employee tax withholding on equity awards (11,644 ) (14,665 )
Principal payments under finance lease obligations (24,362 ) -
Change in tenants' security deposits 2,157 1,248
Net cash flow used for financing activities (757,986 ) (1,115,820 )
Net change in cash, cash equivalents and restricted cash (461,905 ) (656,202 )
Cash, cash equivalents and restricted cash, beginning of the period 689,731 783,757
Cash, cash equivalents and restricted cash, end of the period $ 227,826 $ 127,555
Interest paid (net of capitalized interest of $1,166 and $1,153, respectively) $ 167,401 $ 150,906
Income taxes paid, net of refunds $ 25,773 $ 57,805

The accompanying notes are an integral part of these condensed consolidated financial statements.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

  1. Business and Organization

Kimco Realty Corporation and its subsidiaries (the “Parent Company”) operates as a Real Estate Investment Trust ("REIT"), of which substantially all of the Parent Company’s assets are held by, and substantially all of the Parent Company’s operations are conducted through, Kimco Realty OP, LLC (“Kimco OP”), either directly or through its subsidiaries, as the Parent Company’s operating company. The Parent Company is the managing member and exercises exclusive control over Kimco OP. As of June 30, 2025, the Parent Company owned 99.79% of the outstanding limited liability company interests (the "OP Units") in Kimco OP. The terms “Kimco,” “the Company” and “our” each refer to the Parent Company and Kimco OP, collectively, unless the context indicates otherwise. In statements regarding qualification as a REIT, such terms refer solely to Kimco Realty Corporation.

The Company is the leading owner and operator of high-quality, open-air, grocery-anchored shopping centers and mixed-use properties in the United States. The Company’s portfolio is primarily concentrated in the first-ring suburbs of the top major metropolitan markets, including those in high-barrier-to-entry coastal markets and rapidly expanding Sun Belt cities, with a tenant mix focused on essential, necessity-based goods and services that drive multiple shopping trips per week. The Company, its affiliates and related real estate joint ventures are engaged principally in the ownership, management, development and operation of open-air shopping centers, including mixed-use assets, which are anchored primarily by grocery stores, off-price retailers, discounters or service-oriented tenants. Additionally, the Company provides complementary services that capitalize on the Company’s established retail real estate expertise. The Company’s mission is to create destinations for everyday living that inspire a sense of community and deliver value to our many stakeholders. The Company evaluates performance on a property specific or transactional basis and does not distinguish its principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company believes it has a single reportable segment for disclosure purposes in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

The Company elected status as a REIT for federal income tax purposes commencing with its taxable year which began January 1, 1992 and operates in a manner that enables the Company to maintain its status as a REIT. To qualify as a REIT, the Company must meet several organizational and operational requirements, and is required to annually distribute at least 90% of its net taxable income, determined without regard to the dividends paid deduction and excluding any net capital gain. In addition, the Company will be subject to federal income tax at regular corporate rates to the extent that it distributes less than 100% of its net taxable income, including any net capital gains. In January 2023, the Company consummated a reorganization into an umbrella partnership real estate investment trust structure (“UPREIT”). The Company believes it is organized and operates in such a manner to qualify and remain qualified as a REIT, in accordance with Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”). The Company, generally, will not be subject to U.S. federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income, as defined in the Code. The Company maintains certain subsidiaries that have made joint elections with the Company to be treated as taxable REIT subsidiaries (“TRSs”), that permit the Company to engage through such TRSs in certain business activities that the REIT may not conduct directly. A TRS is subject to federal and state income taxes on its income, and the Company includes, when applicable, a provision for taxes in its condensed consolidated financial statements.

RPT Merger

On January 2, 2024, RPT Realty (“RPT”) merged with and into the Company, with the Company continuing as the surviving public company (the “RPT Merger”), pursuant to the definitive merger agreement (the “Merger Agreement”) between the Company and RPT, entered into on August 28, 2023. Under the terms of the Merger Agreement, each RPT common share was converted into 0.6049 of a newly issued share of the Company’s common stock, together with cash in lieu of fractional shares, and each 7.25% Series D Cumulative Convertible Perpetual Preferred Share of RPT was converted into the right to receive one depositary share representing one one-thousandth of a share of the Company’s 7.25% Class N Cumulative Convertible Perpetual Preferred Stock, par value $1.00 per share (“Class N Preferred Stock”). During the six months ended June 30, 2024, the Company incurred expenses of $25.2 million associated with the RPT Merger, primarily comprised of severance, legal and professional fees. See Footnote 3 of the Notes to Condensed Consolidated Financial Statements for further details.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  1. Summary of Significant Accounting Policies

Basis of Presentation

This report combines the quarterly reports on Form 10-Q for the quarterly period ended June 30, 2025, of the Parent Company and Kimco OP into this single report. The accompanying Condensed Consolidated Financial Statements include the accounts of the Parent Company and Kimco OP and their consolidated subsidiaries. The Company’s subsidiaries include subsidiaries which are wholly owned or which the Company has a controlling interest, including where the Company has been determined to be a primary beneficiary of a variable interest entity (“VIE”) in accordance with the consolidation guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). The Parent Company serves as the general member of Kimco OP. The limited members of Kimco OP have limited rights over Kimco OP and do not have the power to direct the activities that most significantly impact Kimco OP’s economic performance. As such, Kimco OP is considered a VIE, and the Parent Company, which consolidates it, is the primary beneficiary. All inter-company balances and transactions have been eliminated in consolidation. The information presented in the accompanying Condensed Consolidated Financial Statements is unaudited and reflects all adjustments which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods presented, and all such adjustments are of a normal recurring nature. Amounts as of December 31, 2024 included in the Condensed Consolidated Financial Statements have been derived from the audited Consolidated Financial Statements as of that date, but do not include all annual disclosures required by GAAP. These Condensed Consolidated Financial Statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as certain disclosures in this Quarterly Report that would duplicate those included in such Annual Report on Form 10-K are not included in these Condensed Consolidated Financial Statements.

On January 2, 2024, the Parent Company, as managing member of Kimco OP, entered into an amended and restated limited liability company agreement of Kimco OP (the “Amended and Restated Limited Liability Company Agreement”), providing for, among other things, the creation of Class N Preferred Units of Kimco OP, having the preferences, rights and limitations set forth therein, and certain modifications to the provisions regarding long-term incentive plan units (“LTIP Units”), including provisions governing distribution and tax allocation requirements and the procedures for converting LTIP Units.

Subsequent Events

The Company has evaluated subsequent events and transactions for potential recognition or disclosure in its Condensed Consolidated Financial Statements.

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law, which included certain modifications to U.S. tax law, including certain provisions that affect the taxation of REITs and their investors. The OBBBA permanently extended certain provisions that were enacted in the Tax Cuts and Jobs Act of 2017. Such extensions included the permanent extension of the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers. The OBBBA also increased the percentage limit under the REIT asset test applicable to TRSs (the permissible value of TRS securities that a REIT may hold) from 20% to 25% of the value of the REIT’s total assets for taxable years beginning after December 31, 2025. The Company is currently evaluating the provisions of the OBBBA, but does not expect the OBBBA to have a material impact on the Company’s financial position and/or results of operations.

Reclassifications

Certain amounts in the prior period have been reclassified in order to conform to the current period’s presentation. For comparative purposes, as of December 31, 2024, the Company reclassified Mortgage and other financing receivables, net from Other assets to a separate line item and reclassified Marketable securities to Other assets on the Company’s Condensed Consolidated Balance Sheet as follows (in thousands):

As of December 31, 2024
Mortgage and other financing receivables, net $ 444,966
Marketable securities $ (2,290 )
Other assets $ (442,676 )

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

For comparative purposes, for the three and six months ended June 30, 2024, the Company reclassified Mortgage and other financing income, net from Other income, net to a separate line item on the Company’s Condensed Consolidated Statements of Income as follows (in thousands):

Three Months Ended June 30, 2024 Six Months Ended June 30, 2024
Mortgage and other financing income, net $ 4,751 $ 7,270
Other income, net $ (4,751 ) $ (7,270 )

New Accounting Pronouncements

The following table represents Accounting Standards Updates (“ASUs”) to the FASB’s ASC that, as of June 30, 2025, are not yet effective for the Company and for which the Company has not elected early adoption, where permitted:

ASU Description Effective Date Effect on the financial statements or other significant matters
ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures This ASU requires entities to provide additional information in the rate reconciliation and additional disclosures about income taxes paid. The guidance requires public business entities to disclose in their rate reconciliation table additional categories of information about federal, state and foreign income taxes and to provide more details about the reconciling items in some categories if the items meet a quantitative threshold. The guidance requires all entities annually to disclose income taxes paid (net of refunds received) disaggregated by federal (national), state and foreign taxes and to disaggregate the information by jurisdiction based on a quantitative threshold. The amendments are to be applied prospectively, although retrospective adoption is permitted. Fiscal years<br><br>beginning January 1, 2025, and interim periods for fiscal years beginning January 1, 2026; Early adoption permitted The Company is reviewing the extent of new disclosures necessary prior to implementation. Other than additional disclosure, the adoption of this ASU will not have a material impact on the Company’s financial position and/or results of operations.
ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses<br><br><br><br>ASU 2025-01, Income Statement - Reporting Comprehensive, Income -Expense Disaggregation Disclosures (Subtopic 220-40), Clarifying the Effective Date This ASU requires additional disclosure about a public business entity’s expenses and more detailed information about the types of expenses in commonly presented expense captions. Such information should allow investors to better understand an entity's performance, assess future cash flows, and compare performance over time and with other entities. The amendments will require public business entities to disclose in the notes to the financial statements, at each interim and annual reporting period, specific information about certain costs and expenses, employee compensation, depreciation, and intangible asset amortization included in each expense caption presented on the face of the income statement, and the total amount of an entity's operating expenses. The amendments are to be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all prior periods presented in the financial statements. Fiscal years beginning January 1, 2027, and interim periods for fiscal years beginning January 1, 2028; Early adoption permitted The Company does not expect the adoption of this ASU to have a material impact on the Company’s financial position and/or results of operations.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

ASU 2025-03 Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity The amendments in this ASU revise the guidance for determining the accounting acquirer in the acquisition of a VIE. An entity will be required to consider the factors in ASC 805-10-55-12 through 805-10-55-15 in determining which entity is the accounting acquirer when a VIE is acquired in a business combination effected primarily by exchanging equity interests. Previously, the primary beneficiary was always identified as the accounting acquirer in such transactions. The amendments are required to be applied prospectively to any acquisition transaction that occurs after the initial application date. January 1, 2027; Early adoption is permitted as of the beginning of an interim or annual reporting<br>period The Company does not expect the adoption of this ASU, which is applied prospectively, to have a material impact on the Company’s financial position and/or results of operations.

The following ASUs to the FASB’s ASCs have been adopted by the Company as of the date listed:

ASU Description Adoption Date Effect on the financial statements or other significant matters
ASU 2023-05, Business Combinations – Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement The amendments in this ASU address the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. To reduce diversity in practice and provide decision-useful information to a joint venture’s investors, these amendments require that a joint venture apply a new basis of accounting upon formation. By applying a new basis of accounting, a joint venture, upon formation, will recognize and initially measure its assets and liabilities at fair value (with exceptions to fair value measurement that are consistent with the business combinations guidance). Additionally, existing joint ventures have the option to apply the guidance retrospectively. January 1, 2025 This ASU does not impact accounting for joint ventures by the venturers. As such, the adoption of this ASU did not have an impact on the Company’s financial position and/or results of operations.
ASU 2024-01, Compensation - Stock Compensation (Topic 718) The amendments in this ASU clarify how to determine whether profits interest and similar awards should be accounted for as a share-based payment arrangement (ASC 718) or as a cash bonus or profit-sharing arrangement (ASC 710, Compensation - General, or other guidance) and apply to all reporting entities that account for profits interest awards as compensation to employees or non-employees. In addition to the illustrative guidance, this ASU modifies the language in paragraph 718-10-15-3 to improve its clarity and operability without changing the guidance. The amendments should be applied either retrospectively to all prior periods presented in the financial statements, or prospectively to profits interests and similar awards granted or modified on or after the adoption date. January 1, 2025 The adoption of this ASU did not have a material impact on the Company’s financial position and/or results of operations.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  1. RPT Merger

Overview

On January 2, 2024, the Company completed the RPT Merger, under which RPT merged with and into the Company, with the Company continuing as the surviving public company. Under the terms of the Merger Agreement, each RPT common share was converted into 0.6049 of a newly issued share of the Company’s common stock, together with cash in lieu of fractional shares and each 7.25% Series D Cumulative Convertible Perpetual Preferred Share of RPT was converted into the right to receive one depositary share representing one one-thousandth of a share of Class N Preferred Stock of the Company.

The following highlights the Company’s significant activity upon completion of the $1.4 billion RPT Merger on January 2, 2024:

  • Added 56 open-air shopping centers, 43 of which were wholly owned and 13 of which were owned through a joint venture, comprising 13.3 million square feet of gross leasable area (“GLA”);
  • Obtained RPT’s 6% stake in a 49-property net lease joint venture;
  • Assumed $821.5 million of unsecured notes and term loans, of which the Company repaid $511.5 million of unsecured notes in January 2024;
  • Issued 53.0 million shares of common stock and 1.8 million depositary shares of Class N Preferred Stock to effect the RPT Merger;
  • Issued 953,400 OP Units in Kimco OP, which were fully vested upon issuance and had a fair market value of $21.0 million;
  • Obtained a $13.5 million operating right-of-use asset (excluding an intangible right-of-use asset of $7.4 million) in exchange for a new operating lease liability related to a property under an operating ground lease agreement; and
  • Obtained a finance right-of-use asset of $6.8 million (which is included in Other assets on the Company’s Condensed Consolidated Balance Sheets).

Since the date of the RPT Merger through June 30, 2024, the revenue and net income included in the Company’s Condensed Consolidated Statements of Income were $89.3 million and $5.7 million (excluding $25.2 million of merger-related charges), respectively.

Pro forma Information

The pro forma financial information set forth below is based upon the Company’s historical Condensed Consolidated Statements of Income for the three and six months ended June 30, 2024, adjusted to give effect to these properties acquired as of January 1, 2023. The pro forma financial information is presented for informational purposes only and may not be indicative of what actual results of income would have been, nor does it purport to represent the results of income for future periods. Amounts are presented in millions.

Three Months Ended June 30, 2024 Six Months Ended June 30, 2024
Revenues from rental properties, net $ 496.2 $ 995.1
Net income (1) $ 122.1 $ 138.3
Net income available to the Company’s common shareholders (1) $ 111.8 $ 118.1
  • The pro forma earnings for the six months ended June 30, 2024 were adjusted to exclude merger-related charges of $25.2 million.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  1. Real Estate

Acquisitions

During the six months ended June 30, 2025, the Company acquired the following operating properties, through direct asset acquisitions (in thousands):

Purchase Price
Property Name Location Month Acquired Cash Debt Other Total GLA
Markets at Town Center (1) Jacksonville, FL Jan-25 $ 108,238 $ - $ - $ 108,238 254
College Park Land (2) Las Vegas, NV Jan-25 12,746 - 1,428 14,174 -
Francisco Center Land (2) Las Vegas, NV Jan-25 11,588 - 593 12,181 -
$ 132,572 $ - $ 2,021 $ 134,593 254
  • The Company had a mortgage receivable of $15.0 million related to this property, which was repaid by the seller at closing.
  • The Company acquired the fee interest in two properties under finance ground lease agreements through the exercise of a call option for an aggregate purchase price of $24.2 million. In addition, the Company had a mortgage receivable of $3.4 million, which was repaid by the seller at closing. This transaction also resulted in a decrease in Other assets of $26.2 million and a decrease in Other liabilities of $24.2 million on the Company’s Condensed Consolidated Balance Sheets related to the finance right-of-use assets and lease liabilities (included in Other). See Footnote 9 of the Notes to Condensed Consolidated Financial Statements for further details.

Included in the Company’s Condensed Consolidated Statements of Income is $5.6 million in total revenues and $0.6 million in net income from the date of acquisition through June 30, 2025 for the operating properties acquired during the period.

The purchase price for these acquisitions was allocated to real estate and related intangible assets and liabilities acquired, as applicable, in accordance with our accounting policies for asset acquisitions. The purchase price allocation for properties acquired during the six months ended June 30, 2025 were as follows (in thousands):

Allocation as of <br>June 30, 2025 Weighted Average Useful Life (in Years)
Land $ 48,844 n/a
Buildings 68,659 50.0
Building improvements 4,700 45.0
Tenant improvements 5,390 6.2
In-place leases 12,859 4.9
Above-market leases 457 5.4
Below-market leases (6,316 ) 15.8
Net assets acquired $ 134,593

During the six months ended June 30, 2024, there were no operating property acquisitions other than those acquired in connection with the RPT Merger (See Footnote 3 of the Notes to Condensed Consolidated Financial Statements for further details).

Dispositions

The table below summarizes the Company’s disposition activity relating to consolidated operating properties and parcels for the six months ended June 30, 2025 and 2024 (dollars in millions):

Six Months Ended June 30,
2025 2024
Aggregate sales price/gross fair value (1) (2) $ 51.9 $ 254.1
Gain on sale of properties (3) $ 39.8 $ 0.4
Number of operating properties sold 1 11
Number of parcels sold 2 7
  • During the six months ended June 30, 2024, the Company provided, as a lender, seller financing totaling $175.4 million related to the sale of nine operating properties.
  • Includes $48.7 million of Internal Revenue Code 26 U.S.C. §1031 proceeds held in escrow through sale of real estate interests as of June 30, 2025.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  • Before noncontrolling interests of $0.1 million and taxes of $0.4 million for the six months ended June 30, 2025.

Impairments

During the six months ended June 30, 2025, the Company recognized aggregate impairment charges related to adjustments to property carrying values of $8.2 million, for which the Company’s estimated fair values were primarily based upon signed contracts or letters of intent from third party offers. These adjustments to property carrying values were recognized in connection with the Company’s efforts to market certain properties and management’s assessment as to the likelihood and timing of such potential transactions. See Footnote 15 of the Notes to Condensed Consolidated Financial Statements for fair value disclosure.

  1. Investments in and Advances to Real Estate Joint Ventures

The Company has investments in and advances to various real estate joint ventures. These joint ventures are engaged primarily in the operation of shopping centers which are either owned or held under long-term operating leases. The Company and the joint venture partners have joint approval rights for major decisions, including those regarding property operations. As such, the Company holds noncontrolling interests in these joint ventures and accounts for them under the equity method of accounting. The Company manages certain of these joint venture investments and, where applicable, earns acquisition fees, leasing commissions, property management fees, asset management fees and construction management fees. The table below presents unconsolidated joint venture investments for which the Company held an ownership interest at June 30, 2025 and December 31, 2024 (in millions, except number of properties and GLA):

Noncontrolling<br>Ownership Interest The Company’s Investment
Joint Venture As of June 30, 2025 June 30, 2025 December 31, 2024
Prudential Investment Program 15.0% $ 127.5 $ 133.3
Kimco Income Opportunity Portfolio (“KIR”) 52.1% 287.0 289.1
R2G Venture LLC (“R2G”) 51.5% 407.5 411.8
Canada Pension Plan Investment Board (“CPP”) 55.0% 203.3 202.8
Other Institutional Joint Ventures Various 232.6 237.7
Other Joint Venture Programs Various 209.0 213.0
Total* $ 1,466.9 $ 1,487.7

* Represents 115 property interests, 48 other property interests and 24.9 million square feet of GLA, as of June 30, 2025, and 116 property interests, 48 other property interests and 25.1 million square feet of GLA, as of December 31, 2024.

The table below presents the Company’s share of net income for the above investments, which is included in Equity in income of joint ventures, net on the Company’s Condensed Consolidated Statements of Income for the three and six months ended June 30, 2025 and 2024 (in millions):

Three Months Ended June 30, Six Months Ended June 30,
Joint Venture 2025 2024 2025 2024
Prudential Investment Program $ 2.3 $ 4.1 $ 5.4 $ 6.4
KIR 8.2 8.7 18.3 18.4
R2G 2.0 2.5 4.3 4.2
CPP 3.0 2.4 6.2 4.6
Other Institutional Joint Ventures 1.0 1.0 2.1 2.4
Other Joint Venture Programs (1) 7.5 2.8 10.4 6.4
Total $ 24.0 $ 21.5 $ 46.7 $ 42.4
  • During the three months ended June 30, 2025, the Company recognized $4.7 million of equity in income related to the restructuring of a joint venture.

During the six months ended June 30, 2025, certain of the Company’s real estate joint ventures disposed of an operating property and a land parcel, in separate transactions, for an aggregate sales price of $39.8 million. These transactions resulted in an aggregate net gain to the Company of $0.8 million for the six months ended June 30, 2025, which is included in Equity in income of joint ventures, net on the Company’s Condensed Consolidated Statements of Income.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

During the six months ended June 30, 2024, certain of the Company’s real estate joint ventures disposed of an operating property and other property interest, in separate transactions, for an aggregate sales price of $19.2 million. These transactions resulted in an aggregate net gain to the Company of $1.4 million for the six months ended June 30, 2024, which is included in Equity in income of joint ventures, net on the Company’s Condensed Consolidated Statements of Income.

The table below presents debt balances within the Company’s unconsolidated joint venture investments for which the Company held noncontrolling ownership interests at June 30, 2025 and December 31, 2024 (dollars in millions):

As of June 30, 2025 As of December 31, 2024
Joint Venture Mortgages <br>and Notes<br>Payable, Net Weighted Average<br>Interest Rate Weighted Average<br>Remaining Term<br>(months)* Mortgages <br>and Notes<br>Payable, Net Weighted Average<br>Interest Rate Weighted Average<br>Remaining Term<br>(months)*
Prudential Investment Program $ 266.9 5.38 % 26.3 $ 268.5 5.47 % 19.6
KIR 274.1 4.70 % 21.2 273.9 5.82 % 27.2
R2G 69.7 2.90 % 68.7 68.7 2.90 % 74.6
CPP 80.0 4.88 % 13.1 80.6 4.88 % 19.0
Other Institutional Joint Ventures 235.1 5.31 % 17.7 234.7 5.76 % 23.7
Other Joint Venture Programs 542.3 5.00 % 36.3 547.3 4.98 % 40.8
Total $ 1,468.1 $ 1,473.7

* Includes extension options

  1. Other Investments

The Company has provided capital to owners and developers of real estate properties through its Preferred Equity program, which is included in Other investments on the Company’s Condensed Consolidated Balance Sheets. In addition, the Company has invested capital in certain structured investments that are accounted for on the equity method of accounting. As of June 30, 2025 and December 31, 2024, the Company’s Other investments were $109.8 million and $107.3 million, respectively, of which the Company’s net investments under the Preferred Equity program were $70.0 million and $70.1 million as of June 30, 2025 and December 31, 2024, respectively.

During the six months ended June 30, 2024, the Company converted its $50.2 million preferred equity investment into mezzanine loan financing for a property in San Antonio, TX. In addition, the Company acquired the outstanding senior mortgage loan of $146.2 million encumbering the property.

  1. Mortgage and Other Financing Receivables

The Company has various mortgage and other financing receivables, which consist of loans acquired and loans originated by the Company. As of June 30, 2025 and December 31, 2024, the Company had mortgage and other financing receivables, net of allowance for credit losses, of $441.0 million and $445.0 million, respectively. As of June 30, 2025, these mortgage and other receivables have scheduled maturities ranging from less than one month to

9.3

years and accrue interest at rates ranging from 6.35% to 14.00%. During the six months ended June 30, 2025 and 2024, the Company recognized mortgage and other financing income, net of $23.3 million and $7.3 million, respectively, on the Company’s Condensed Consolidated Statements of Income. During the six months ended June 30, 2025, the Company (i) provided $46.2 million of mortgage and other financing loans, (ii) collected $50.1 million of mortgage and other financing receivables, of which $18.4 million was repaid at closing upon the Company’s acquisition of the corresponding properties, and (iii) extended two mortgage loans with an aggregate principal balance of $159.7 million, utilizing extension options ranging from six months to one year.

During the six months ended June 30, 2024, the Company (i) issued $175.4 million of seller financing related to the sale of nine operating properties, which were acquired in conjunction with the RPT Merger, (ii) provided $175.2 million of mortgage and other financing loans, (iii) provided $50.2 million of mortgage loan financing related to the Company’s previously held preferred equity investment and (iv) collected $60.1 million of mortgage and other financing receivables.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents the changes in the allowance for credit losses for the six months ended June 30, 2025 and 2024, respectively (in thousands):

Six Months Ended June 30,
2025 2024
Balance at January 1, $ 6,800 $ 1,300
Provision for credit losses 693 4,500
Recoveries collected (693 ) -
Balance at June 30, $ 6,800 $ 5,800
  1. Accounts and Notes Receivable

The components of Accounts and notes receivable, net of potentially uncollectible amounts as of June 30, 2025 and December 31, 2024, were as follows (in thousands):

As of June 30, 2025 As of December 31, 2024
Billed tenant receivables $ 15,108 $ 23,011
Unbilled common area maintenance, insurance and tax reimbursements 62,842 67,010
Other receivables 16,341 15,865
Straight-line rent receivables 245,060 234,583
Total accounts and notes receivable, net $ 339,351 $ 340,469
  1. Leases

Lessor Leases

The Company’s primary source of revenues is derived from lease agreements, which includes rental income and expense reimbursement. The Company’s lease income is comprised of minimum base rent, expense reimbursements, percentage rent, lease termination fee income, ancillary income, amortization of above-market and below-market rent adjustments and straight-line rent adjustments.

The disaggregation of the Company’s lease income, which is included in Revenues from rental properties, net on the Company’s Condensed Consolidated Statements of Income, as either fixed or variable lease income based on the criteria specified in ASC 842, for the three and six months ended June 30, 2025 and 2024, was as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Lease income:
Fixed lease income (1) $ 413,727 $ 396,640 $ 829,898 $ 794,335
Variable lease income (2) 105,829 100,006 218,816 198,287
Above-market and below-market leases amortization, net 7,330 4,444 12,644 10,345
Adjustments for potentially uncollectible lease income or disputed<br>   amounts (5,956 ) (4,869 ) (9,142 ) (7,841 )
Total lease income $ 520,930 $ 496,221 $ 1,052,216 $ 995,126
  • Includes minimum base rents, expense reimbursements, ancillary income and straight-line rent adjustments.
  • Includes minimum base rents, expense reimbursements, percentage rent, lease termination fee income and ancillary income.

Lessee Leases

The Company currently leases real estate space under non-cancelable operating lease agreements for ground leases and administrative office leases. The Company’s operating leases have remaining lease terms ranging from less than one year to

79.8

years, some of which include options to extend the terms for up to an additional 60 years. During the six months ended June 30, 2025, the Company obtained a $7.4 million operating right-of-use asset in exchange for a new operating lease liability related to an option exercise for a property under an operating ground lease agreement.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company had three properties under finance ground lease agreements that consisted of variable lease payments with a bargain purchase option. During the six months ended June 30, 2025, the Company acquired the fee interest in two properties under finance ground lease agreements through the exercise of its call option for an aggregate purchase price of $24.2 million. This transaction resulted in a decrease in Other assets of $26.2 million and a decrease in Other liabilities of $24.2 million on the Company’s Condensed Consolidated Balance Sheets related to the finance right-of-use assets and lease liabilities. As of June 30, 2025, the Company has a property under a finance ground lease agreement with a right-of-use asset of $6.8 million, which is included in Other assets on the Company’s Condensed Consolidated Balance Sheets.

The weighted-average remaining non-cancelable lease term and weighted-average discount rates for the Company’s operating leases as of June 30, 2025 were as follows:

Operating Leases
Weighted-average remaining lease term (in years) 29.22
Weighted-average discount rate 6.78 %

The components of the Company’s lease expense, which are included in interest expense, rent expense and general and administrative expense on the Company’s Condensed Consolidated Statements of Income for the three and six months ended June 30, 2025 and 2024, were as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Lease cost:
Finance lease cost $ - $ 365 $ 43 $ 731
Operating lease cost 3,600 3,843 7,041 7,714
Variable lease cost 724 502 1,565 1,161
Total lease cost $ 4,324 $ 4,710 $ 8,649 $ 9,606
  1. Other Assets

Marketable Securities

During the six months ended June 30, 2024, the Company sold its remaining 14.2 million shares of common stock of Albertsons Companies Inc. (“ACI”), generating net proceeds of $299.1 million. For tax purposes, the Company recognized a long-term capital gain of $288.7 million and elected to retain the proceeds from the sale of ACI common stock, resulting in estimated federal and state income tax expense of $72.9 million during the six months ended June 30, 2024.

The portion of unrealized (losses)/gains on marketable securities for the three and six months ended June 30, 2025 and 2024 that related to marketable securities still held at the reporting date (in thousands):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Loss on marketable securities, net $ (2 ) $ (6 ) $ (11 ) $ (27,692 )
Less: Net (gain)/loss recognized related to marketable<br>   securities sold - (24 ) (2 ) 27,671
Unrealized loss related to marketable<br>   securities still held $ (2 ) $ (30 ) $ (13 ) $ (21 )
  1. Notes and Mortgages Payable

Notes Payable

The Company has a $2.0 billion unsecured revolving credit facility (the “Credit Facility”) with a group of banks. The Credit Facility is scheduled to expire in March 2027 with two additional six-month options to extend the maturity date, at the Company’s discretion, to March 2028. The Credit Facility can be increased to $2.75 billion through an accordion feature. The Credit Facility is a green credit facility tied to sustainability metric targets, as described in the agreement. The Credit Facility accrues interest at a rate of Adjusted Term Secured Overnight Financing Rate (“SOFR”), as defined in the terms of the Credit Facility, plus an applicable spread determined by the Company’s credit ratings. The interest rate can be further adjusted upward or downward based on the sustainability metric targets, as

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

defined in the agreement. As of June 30, 2025, the interest rate on the Credit Facility is Adjusted Term SOFR plus 68.5 basis points (5.11% as of June 30, 2025) after reductions for sustainability metrics achieved and an upgraded credit rating profile. Pursuant to the terms of the Credit Facility, the Company is subject to certain covenants. As of June 30, 2025, the Credit Facility had no outstanding balance and no appropriations for letters of credit, and the Company was in compliance with its covenants.

The Company has $310.0 million of unsecured term loans (the “Term Loans”) with a group of banks, which are scheduled to expire between November 2026 to February 2028. The Term Loans accrue interest at the rate of Adjusted Term SOFR plus an applicable spread determined by the Company’s credit rating outlook and sustainability metric targets, as described in the agreement. As of June 30, 2025, the interest rates on the Term Loans is Adjusted Term

SOFR

plus 81.0 basis points after reductions for an upgraded credit rating profile and sustainability metrics achieved. As of June 30, 2025, the Company had 20 swap rate agreements with various lenders swapping the interest rates on the Term Loans to all-in fixed rates ranging from 4.5793% to 4.7801%. See Footnote 12 of the Notes to Condensed Consolidated Financial Statements for interest rate swap disclosure. During June 2025, the Company issued $500.0 million in senior unsecured notes, which are scheduled to mature in February 2036 and accrue interest at a rate of 5.30% per annum. These senior unsecured notes are guaranteed by the Parent Company.

The Company has a $550.0 million unsecured term loan credit facility (the “Term Loan Credit Facility”) with a group of banks, which is scheduled to mature in January 2026 with three one-year options to extend the maturity date, at the Company’s discretion, to January 2029. The Term Loan Credit Facility accrues interest at a spread (currently 80.0 basis points after reductions for an upgraded credit rating profile) to the Adjusted Term SOFR Rate (as defined in the credit agreement), that fluctuates in accordance with changes in the Company’s senior debt ratings. As of June 30, 2025, the Company had six swap rate agreements with various lenders swapping the overall interest rate on the $550.0 million Term Loan Credit Facility to an all-in fixed rate of 4.6122%. See Footnote 12 of the Notes to Condensed Consolidated Financial Statements for interest rate swap disclosure.

During the six months ended June 30, 2025 and 2024, the Company fully repaid the following notes payable (dollars in millions):

Type Date Paid Amount Repaid Interest Rate Maturity Date
Unsecured note Jun-25 $ 240.5 3.85% Jun-25
Unsecured note Feb-25 $ 500.0 3.30% Feb-25
Unsecured note Mar-24 $ 400.0 2.70% Mar-24
Unsecured notes (1) Jan-24 $ 511.5 3.64%-4.74% Jun-25-Nov-31
Unsecured term loan Jan-24 $ 50.0 4.15% Nov-26
Unsecured term loan Jan-24 $ 100.0 4.11% Feb-27
Unsecured term loan Jan-24 $ 50.0 3.43% Aug-27
Unsecured term loan Jan-24 $ 110.0 3.71% Feb-28
  • The Company incurred a make-whole charge of $0.3 million resulting from this early repayment of these notes, which are included in Merger charges on the Company’s Condensed Consolidated Statements of Income.

The Parent Company guarantees the unsecured debt instruments of Kimco OP, including the Credit Facility. These guarantees by the Parent Company are full, irrevocable, unconditional and absolute joint and several guarantees to the holders of each series of such unsecured debt instruments.

Mortgages Payable

During the six months ended June 30, 2025, the Company repaid $48.9 million of mortgage debt (including fair market value adjustment of $0.1 million) that encumbered three operating properties.

  1. Derivatives

Derivative Instruments & Hedging Activities

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company manages economic risks, including interest rate, liquidity, and credit risks, primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company may use derivatives to manage exposures that arise

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

from changes in interest rates and limits the risk by following established risk management policies and procedures, including the use of derivative financial instruments.

The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate these risks, the Company only enters into derivative financial instruments with counterparties with major financial institutions. The Company does not anticipate that any of the counterparties will fail to meet their obligations. The Company's objectives in using interest rate derivatives are to attempt to stabilize interest expense where possible and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate 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.

During 2024, the Company entered into 26 interest rate swap agreements with notional amounts aggregating to $860.0 million. The interest rate swap agreements are designated as cash flow hedges and are held by the Company to reduce the impact of changes in interest rates on variable rate debt. As of June 30, 2025, all interest rate swaps were deemed effective and are therefore included within Accumulated other comprehensive (loss)/income (“AOCI”) on the Company’s Condensed Consolidated Balance Sheets. As of June 30, 2025, the Company expects approximately $0.6 million of accumulated comprehensive income on derivative instruments to be reclassified into earnings as a reduction to interest expense during the next 12 months.

The interest rate swaps are measured at fair value using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. The Company classifies the interest rate swaps as Level 2 and the fair value of the interest rate swaps are measured on a recurring basis, see Footnote 15 of the Notes to Condensed Consolidated Financial Statements.

The following table summarizes the terms and fair value of the Company’s derivative financial instruments as of June 30, 2025 (dollars in thousands):

Instrument Number of Swap Agreements Associated Debt Instrument Effective Date Maturity Date Notional<br>Amount (1) Derivative<br> Liabilities (2)
Interest rate swap 1 $200.0 Million Term Loan Jan-24 Jan-29 $ 200,000 $ (1,841 )
Interest rate swaps 3 $50.0 Million Term Loan Jan-24 Nov-26 50,000 (163 )
Interest rate swaps 3 $100.0 Million Term Loan Jan-24 Feb-27 100,000 (453 )
Interest rate swaps 7 $50.0 Million Term Loan Jan-24 Aug-27 50,000 (315 )
Interest rate swaps 7 $110.0 Million Term Loan Jan-24 Feb-28 110,000 (839 )
Interest rate swaps 4 $300.0 Million Term Loan Jul-24 Jan-29 300,000 (4,817 )
Interest rate swap 1 $50.0 Million Term Loan Sept-24 Jan-29 50,000 (42 )
$ 860,000 $ (8,470 )
  • These interest rate swap agreements utilize a one-month SOFR CME index.
  • Derivative liabilities are included within Other liabilities on the Company’s Condensed Consolidated Balance Sheets.

The table below details the location in the financial statements of the gain/(loss) recognized on interest rate swaps designated as cash flow hedges for the three and six months ended June 30, 2025 and 2024 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Amount of (loss)/gain recognized in AOCI on interest rate swaps, net $ (4,148 ) $ 3,445 $ (13,135 ) $ 11,982
Amount reclassified from AOCI into income as Interest expense $ 1,292 $ 2,084 $ 2,574 $ 4,162
Total amount of Interest expense presented in the Condensed <br>   Consolidated Statements of Income in which the effects <br>   of cash flow hedges are being recorded $ (81,204 ) $ (73,341 ) $ (161,581 ) $ (147,906 )

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company has interests in certain unconsolidated joint ventures, which have cash flow hedges for interest payments. As of June 30, 2025 and December 31, 2024, the Company’s net share of the fair value of cash flow hedges for interest payments of unconsolidated investees was $0.7 million and $3.8 million, respectively, which is included within AOCI on the Company’s Condensed Consolidated Balance Sheets. 13. Noncontrolling Interests

Noncontrolling interests represent the portion of equity that the Company does not own in those entities it consolidates as a result of having a controlling interest or having determined that the Company was the primary beneficiary of a VIE in accordance with the provisions of the FASB’s Consolidation guidance. The Company accounts and reports for noncontrolling interests in accordance with the Consolidation guidance and the Distinguishing Liabilities from Equity guidance issued by the FASB. The Company identifies its noncontrolling interests separately within the equity section on the Company’s Condensed Consolidated Balance Sheets. The amounts of consolidated net income attributable to the Company and to the noncontrolling interests are presented separately on the Company’s Condensed Consolidated Statements of Income.

The Parent Company issued 953,400 OP Units in Kimco OP during 2024, which were fully vested upon issuance and had a fair market value of $21.0 million. In addition, the Parent Company has granted to certain employees and directors LTIP Units with time-based vesting requirements (“Time-Based LTIP Units”) and LTIP Units with performance-based vesting requirements (“Performance-Based LTIP Units”), assuming the maximum target performance. See Footnote 16 of the Notes to Condensed Consolidated Financial Statements for further disclosure. As of June 30, 2025, the Parent Company owned 99.79% of the outstanding OP Units in Kimco OP. The OP Units are currently redeemable at the option of the holder (subject to restrictions agreed upon at the time of issuance of LTIP Units to certain holders that may restrict such redemption right for a period of time) for the Parent Company’s common stock at a ratio of

1:1

or cash at the option of the Parent Company. As of June 30, 2025, noncontrolling interests relating to the Noncontrolling OP units were $28.1 million and consisted of the following:

Type Units Outstanding Return Per Annum
Vested OP Units 1,002,014 Equal to the Company’s common stock dividend
Unvested Time-Based OP Units 442,708 Equal to the Company’s common stock dividend
Unvested Performance-Based OP Units 1,076,361 Dividend equivalent OP Units upon vesting

The Company owns eight shopping center properties located in Long Island, NY, which were acquired during 2022, partially through the issuance of $122.1 million of Preferred Outside Partner Units and $13.6 million of Common Outside Partner Units. The noncontrolling interest is classified as mezzanine equity and included in Redeemable noncontrolling interests on the Company’s Condensed Consolidated Balance Sheets as a result of the put right available to the unit holders, an event that is not solely in the Company’s control. During the six months ended June 30, 2025, 46,461 Preferred Outside Partner Units and 5,162 Common Outside Partner Units were redeemed for cash of $1.0 million, in separate transactions. These transactions resulted in a net decrease in Redeemable noncontrolling interests of $0.7 million and a decrease in the embedded derivative liability in Other liabilities of $0.4 million on the Company’s Condensed Consolidated Balance Sheets. During the six months ended June 30, 2024, 101,369 Preferred Outside Partner Units and 3,441 Common Outside Partner Units were redeemed for cash of $2.1 million, in separate transactions. These transactions resulted in a net decrease in Redeemable noncontrolling interests of $1.3 million and a decrease in the embedded derivative liability in Other liabilities of $0.8 million on the Company’s Condensed Consolidated Balance Sheets. As of June 30, 2025, the Outside Partner Units related to these acquisitions total $53.6 million, including noncontrolling interests of $36.6 million and an embedded derivative liability associated with put and call options of these unitholders of $17.0 million. The Outside Partner Units related annual cash distribution rates and related conversion features consisted of the following as of June 30, 2025:

Type Par Value <br>Per Unit Units <br>Outstanding Return Per Annum
Preferred Outside Partner Units $ 20.00 2,450,246 3.75%
Common Outside Partner Units $ 20.00 261,369 Equal to the Company’s common stock dividend

Included within noncontrolling interests are units that were determined to be contingently redeemable that are classified as Redeemable noncontrolling interests and presented in the mezzanine section between Total liabilities and Stockholders’ equity/Members’ capital on the Company’s Condensed Consolidated Balance Sheets.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents the change in the redemption value of the Redeemable noncontrolling interests for the six months ended June 30, 2025 and 2024 (in thousands):

Six Months Ended June 30,
2025 2024
Balance at January 1, $ 47,877 $ 72,277
Net income 1,469 2,282
Distributions (1,471 ) (2,282 )
Redemption/conversion of noncontrolling interests (1) (676 ) (1,290 )
Adjustment to estimated redemption value (633 ) (977 )
Balance at June 30, $ 46,566 $ 70,010
  • Includes Preferred and Common Outside Partner Units, which were partially redeemed during the six months ended June 30, 2025 and 2024.
  1. Variable Interest Entities

Consolidated Operating Properties

Kimco OP is considered a VIE, and the Parent Company, which consolidates it, is the primary beneficiary. Substantially all of the Parent Company's assets and liabilities are the assets and liabilities of Kimco OP. In addition, included within the Company’s operating properties at June 30, 2025 and December 31, 2024, are 27 and 29 consolidated entities, respectively, that are VIEs for which the Company is the primary beneficiary. These entities have been established to own and operate real estate property. The Company’s involvement with these entities is through its majority ownership and management of the properties. The entities were deemed VIEs primarily because the unrelated investors do not have substantive kick-out rights to remove the general or managing partner by a vote of a simple majority or less, and they do not have substantive participating rights. The Company determined that it was the primary beneficiary of these VIEs as a result of its controlling financial interest. At June 30, 2025, total assets of these VIEs were $1.7 billion and total liabilities were $159.6 million. At December 31, 2024, total assets of these VIEs were $1.7 billion and total liabilities were $161.6 million.

The majority of the operations of these VIEs are funded with cash flows generated from the properties. The Company has not provided financial support to any of these VIEs that it was not previously contractually required to provide, which consists primarily of funding any capital expenditures, including tenant improvements, which are deemed necessary to continue to operate the entity and any operating cash shortfalls that the entity may experience.

All liabilities of these consolidated VIEs are non-recourse to the Company (“VIE Liabilities”). The assets of the unencumbered VIEs are not restricted for use to settle only the obligations of these VIEs. The remaining VIE assets are encumbered by third-party non-recourse mortgage debt. The assets associated with these encumbered VIEs (“Restricted Assets”) are collateral under the respective mortgages and are therefore restricted and can only be used to settle the corresponding liabilities of the VIE. The table below summarizes the consolidated VIEs and the classification of the Restricted Assets and VIE Liabilities on the Company’s Condensed Consolidated Balance Sheets are as follows (dollars in millions):

As of June 30, 2025 As of December 31, 2024
Number of unencumbered VIEs 25 27
Number of encumbered VIEs 2 2
Total number of consolidated VIEs 27 29
Restricted Assets:
Real estate, net $ 321.9 $ 326.1
Cash, cash equivalents and restricted cash 4.0 4.1
Accounts and notes receivable, net 3.2 3.4
Other assets 1.2 1.3
Total Restricted Assets $ 330.3 $ 334.9
VIE Liabilities:
Mortgages payable, net $ 84.2 $ 85.1
Accounts payable and accrued expenses 13.4 11.6
Operating lease liabilities 1.8 1.8
Other liabilities 60.2 63.1
Total VIE Liabilities $ 159.6 $ 161.6

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Unconsolidated Redevelopment Investment

Included in the Company’s preferred equity investments at June 30, 2025, is an unconsolidated development project which is a VIE for which the Company is not the primary beneficiary. This preferred equity investment was primarily established to develop real estate property for long-term investment and was deemed a VIE primarily based on the fact that the equity investment at risk was not sufficient to permit the entity to finance its activities without additional financial support. The initial equity contributed to this entity was not sufficient to fully finance the real estate construction as development costs are funded by construction loan financing and the partners over the construction period. The Company determined that it was not the primary beneficiary of this VIE based on the fact that the Company has shared control of this entity along with the entity’s partners and therefore does not have a controlling financial interest.

As of June 30, 2025 and December 31, 2024, the Company’s investment in this VIE was $38.7 million and $37.6 million, respectively, which is included in Other investments on the Company’s Condensed Consolidated Balance Sheets. The Company’s maximum exposure to loss as a result of its involvement with this VIE is the Company’s carrying value in this investment. The Company has not provided financial support to this VIE that it was not previously contractually required to provide. All future costs of development will be funded with construction loan financing or capital contributions from the Company and the outside partner in accordance with their respective ownership percentages if necessary.

  1. Fair Value Measurements

All financial instruments of the Company are reflected in the accompanying Condensed Consolidated Balance Sheets at amounts which, in management’s estimation, based upon an interpretation of available market information and valuation methodologies, reasonably approximate their fair values except those listed below, for which fair values are disclosed. The valuation method used to estimate fair value for fixed-rate and variable-rate debt and mortgage and other finance receivables is based on discounted cash flow analyses, with assumptions that include credit spreads, market yield curves, trading activity, loan amounts and debt maturities. The fair values for marketable securities are based on published values, securities dealers’ estimated market values or comparable market sales. The fair value for embedded derivative liability is based on using the “with-and-without” method. Such fair value estimates are not necessarily indicative of the amounts that would be realized upon disposition. Interest rate swaps are measured at fair value using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty's nonperformance risk in the fair value measurements for interest rate swaps.

As a basis for considering market participant assumptions in fair value measurements, the FASB’s Fair Value Measurements and Disclosures guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

The following table presents the carrying amount and estimated fair value of Company's financial instruments not measured at fair value as of June 30, 2025 and December 31, 2024 (in thousands):

June 30, 2025 December 31, 2024
Fair Value Hierarchy Carrying<br>Amount Estimated<br>Fair Value Carrying<br>Amount Estimated<br>Fair Value
Assets:
Mortgage and other financing receivables (1) Level 3 $ 440,991 $ 442,005 $ 444,966 $ 443,234
Liabilities:
Notes payable, net (2)
Senior unsecured notes Level 2 $ 6,858,422 $ 6,434,010 $ 7,106,835 $ 6,538,784
Unsecured term loans Level 3 $ 858,807 $ 860,899 $ 857,903 $ 861,296
Mortgages payable, net (3) Level 3 $ 441,489 $ 424,923 $ 496,438 $ 469,734
  • The carrying value includes and the fair value excludes allowance for credit losses of $6.8 million as of both June 30, 2025 and December 31, 2024.
  • The carrying value includes and the fair value excludes deferred financing costs of $66.8 million and $65.0 million as of June 30, 2025 and December 31, 2024, respectively.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  • The carrying value includes and the fair value excludes deferred financing costs of $1.0 million and $1.1 million as of June 30, 2025 and December 31, 2024, respectively.

The Company has certain financial instruments that must be measured under the FASB’s Fair Value Measurements and Disclosures guidance, including available for sale securities, interest rate swap derivative assets/liabilities and embedded derivative liabilities. The Company currently does not have non-financial assets and non-financial liabilities that are required to be measured at fair value on a recurring basis.

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level of the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The tables below present the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024, aggregated by the level of the fair value hierarchy within which those measurements fall (in thousands):

Balance at <br>June 30, 2025 Level 1 Level 2 Level 3
Assets:
Marketable equity securities $ 2,781 $ 2,781 $ - $ -
Liabilities:
Interest rate swaps derivative liabilities $ 8,470 $ - $ 8,470 $ -
Embedded derivative liability $ 17,035 $ - $ - $ 17,035
Balance at<br> December 31, 2024 Level 1 Level 2 Level 3
--- --- --- --- --- --- --- --- ---
Assets:
Marketable equity securities $ 2,290 $ 2,290 $ - $ -
Interest rate swaps derivative assets $ 7,239 $ - $ 7,239 $ -
Liabilities:
Embedded derivative liability $ 19,864 $ - $ - $ 19,864

The significant unobservable input (Level 3 inputs) used in measuring the Company’s embedded derivative liability, which is categorized with Level 3 of the fair value hierarchy, is the discount rate of 5.60% and 6.40% as of June 30, 2025 and December 31, 2024, respectively.

The table below summarizes the change in the fair value of the embedded derivative liability measured using Level 3 inputs for the six months ended June 30, 2025 and 2024 (in thousands):

Six Months Ended June 30,
2025 2024
Balance as of January 1, $ 19,864 $ 30,914
Settlements (370 ) (802 )
Change in fair value (included in Other income, net) (2,459 ) 3,079
Balance as of June 30, $ 17,035 $ 33,191

Assets measured at fair value on a non-recurring basis at June 30, 2025, were as follows (in thousands):

Balance at<br> June 30, 2025 Level 1 Level 2 Level 3
Real estate $ 16,800 $ - $ - $ 16,800

During the six months ended June 30, 2025 and 2024, the Company recognized impairment charges related to adjustments to property carrying values of $8.2 million and $3.9 million, respectively. The Company’s estimated fair values of these assets were primarily based upon estimated sales prices from signed contracts or letters of intent from third-party offers, which were less than the carrying value of the assets. The Company does not have access to the unobservable inputs used to determine the estimated fair values of third-party offers. Based on these inputs, the Company determined that its valuation of these investments was classified within Level 3 of the fair value hierarchy.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  1. Incentive Plans

In April 2025, the Company’s stockholders approved the 2025 Equity Participation Plan (as amended and/or restated, the “2025 Plan”), which is the successor to the Kimco Realty Corporation 2020 Equity Participation Plan (together with the 2025 Plan, the “Plans”). The 2025 Plan provides for a maximum of 17.5 million shares of the Company’s common stock to be reserved for the issuance of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalents, LTIP Units, stock payments and deferred stock awards. At June 30, 2025, the Company had 16.8 million shares of common stock available for issuance under the 2025 Plan.

The Company accounts for equity awards in accordance with FASB’s compensation – Stock Compensation guidance, which requires that all share-based payments to employees, including grants of employee stock options, restricted stock, performance shares and LTIP Units, be recognized in the Condensed Consolidated Statements of Income over the service period based on their fair values. Fair value of restricted shares and Time-Based LTIP Units are calculated based on the Company’s common stock closing share price on the date of grant. Fair value of performance awards and Performance-Based LTIP Units are determined using the Monte Carlo method, which is intended to estimate the fair value of the awards at the grant date. Granted Time-Based LTIP Units and Performance-Based LTIP Units do not have redemption rights into shares of Company common stock, but any OP Units into which LTIP Units may be converted are entitled to redemption rights.

The Company recognized expenses associated with its equity awards of $18.3 million for both the six months ended June 30, 2025 and 2024. As of June 30, 2025, the Company had $52.8 million of total unrecognized compensation cost related to unvested stock compensation granted under the Plans. That cost is expected to be recognized over a weighted-average period of approximately

2.6

years.

Restricted Stock

Information with respect to restricted stock under the Plans for the six months ended June 30, 2025 and 2024 is as follows:

2025 2024
Restricted stock outstanding as of January 1, 2,745,884 2,746,116
Granted (1) 716,070 872,150
Vested (891,336 ) (693,282 )
Forfeited (6,630 ) (20,710 )
Restricted stock outstanding as of June 30, 2,563,988 2,904,274
  • The weighted-average grant date fair value for restricted stock issued during the six months ended June 30, 2025 and 2024 was $20.08 and $19.47, respectively.

Performance Shares

Information with respect to performance share awards under the Plans for the six months ended June 30, 2025 and 2024 is as follows:

2025 2024
Performance share awards outstanding as of January 1, 908,890 989,860
Granted (1) 264,970 377,690
Vested - (458,660 )
Performance share awards outstanding as of June 30, 1,173,860 908,890
  • The weighted-average grant date fair value for performance shares issued during the six months ended June 30, 2025 and 2024 was $18.84 and $18.14, respectively.

For the six months ended June 30, 2025 and 2024, the Company issued 524,636 and 1,094,621 common shares, respectively, in connection with previously vested performance share awards, including performance dividend equivalent shares.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The significant assumptions underlying the determination of fair values using Monte Carlo simulations for the performance share awards granted during the six months ended June 30, 2025 and 2024 were as follows:

2025 2024
Stock price $ 19.98 $ 19.53
Dividend yield (1) - -
Risk-free interest rate 3.52 % 4.39 %
Volatility (2) 26.07 % 28.85 %
Term of the award (years) 2.67 2.87
  • Total Shareholder Returns, as used in the performance share awards computation, are measured based on cumulative dividend stock prices, as such a zero percent dividend yield is utilized.
  • Volatility is based on the annualized standard deviation of the daily logarithmic returns on dividend-adjusted closing prices over the look-back period based on the term of the award.

Time-Based LTIP Units

Information with respect to Time-Based LTIP Units awards with time-based vesting requirements under the Plans for the six months ended June 30, 2025 and 2024 is as follows:

2025 2024
Time-Based LTIP unit awards outstanding as of January 1, 120,700 -
Granted (1) 370,780 120,700
Vested (48,772 ) -
Time-Based LTIP unit awards outstanding as of June 30, 442,708 120,700
  • The weighted-average grant date fair value for Time-Based LTIP Units issued during the six months ended June 30, 2025 and 2024 was $20.08 and $19.47, respectively.

Performance-Based LTIP Units

Information with respect to Performance-Based LTIP Units under the Plans for the six months ended June 30, 2025 and 2024 is as follows:

2025 2024
Performance-Based LTIP unit awards outstanding as of January 1, 474,611 -
Granted (1) 601,750 474,611
Performance-Based LTIP unit awards outstanding as of June 30, 1,076,361 474,611
  • The weighted-average grant date fair value for Performance-Based LTIP Units issued during the six months ended June 30, 2025 and 2024 was $9.42 and $9.07, respectively.

The significant assumptions underlying the determination of fair values using Monte Carlo simulations for the Performance-Based LTIP Units granted during the six months ended June 30, 2025 and 2024 were as follows:

2025 2024
Stock price $ 19.98 $ 19.53
Dividend yield (1) - -
Risk-free interest rate 3.52 % 4.39 %
Volatility (2) 26.07 % 28.85 %
Term of the award (years) 2.67 2.87
  • Total Shareholder Returns, as used in the Performance-Based LTIP Unit computation, are measured based on cumulative dividend stock prices, as such a zero percent dividend yield is utilized.
  • Volatility is based on the annualized standard deviation of the daily logarithmic returns on dividend-adjusted closing prices over the look-back period based on the term of the award.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  1. Stockholders’ Equity

Preferred Stock

The Company’s outstanding Preferred Stock is detailed below:

As of June 30, 2025
Class of <br>Preferred Stock Shares<br>Authorized Shares<br>Issued and<br>Outstanding Liquidation<br>Preference<br>(in thousands) Dividend<br>Rate Annual<br>Dividend per <br>Depositary<br>Share Par Value Optional<br>Redemption<br>Date
Class L 10,350 8,902 $ 222,543 5.125 % $ 1.28125 $ 1.00 8/16/2022
Class M 10,580 10,465 261,636 5.250 % $ 1.31250 $ 1.00 12/20/2022
Class N 1,849 1,381 69,017 7.250 % $ 3.62500 $ 1.00 N/A
20,748 $ 553,196
As of December 31, 2024
--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Class of <br>Preferred Stock Shares<br>Authorized Shares<br>Issued and<br>Outstanding Liquidation<br>Preference<br>(in thousands) Dividend<br>Rate Annual<br>Dividend per <br>Depositary<br>Share Par Value Optional<br>Redemption<br>Date
Class L 10,350 8,902 $ 222,543 5.125 % $ 1.28125 $ 1.00 8/16/2022
Class M 10,580 10,465 261,636 5.250 % $ 1.31250 $ 1.00 12/20/2022
Class N 1,849 1,439 71,934 7.250 % $ 3.62500 $ 1.00 N/A
20,806 $ 556,113

The Class N Preferred Stock depositary shares are convertible by the holders at an exchange ratio of 2.3071 into the Company’s common shares or under certain circumstances by the Company’s election. As of June 30, 2025, the Class N Preferred Stock was potentially convertible into 3.2 million shares of common stock.

During January 2024, the Company’s Board of Directors authorized the repurchase of up to 891,000 depositary shares of Class L Preferred Stock, 1,047,000 depositary shares of Class M Preferred Stock, and 185,000 depositary shares of Class N Preferred Stock through February 28, 2026. During the six months ended June 30, 2025, the Company repurchased the following preferred stock:

Class of Preferred Stock Depositary Shares<br> Repurchased Purchase Price <br>(in thousands)
Class N 58,342 $ 3,481

The Class L, M and N Preferred Stock rank pari passu as to voting rights, priority for receiving dividends and liquidation preference as set forth below.

As to any matter on which the Class L, M or N Preferred Stock may vote, including any actions by written consent, each share of the Class L, M or N Preferred Stock shall be entitled to 1,000 votes, each of which 1,000 votes may be directed separately by the holder thereof. With respect to each share of Class L, M or N Preferred Stock, the holder thereof may designate up to 1,000 proxies, with each such proxy having the right to vote a whole number of votes (totaling 1,000 votes per share of Class L, M or N Preferred Stock). As a result, each Class L, M or N Depositary Share is entitled to one vote.

Common Stock

During September 2023, the Company established an at-the-market continuous offering program (the “ATM Program”) pursuant to which the Company may offer and sell from time-to-time shares of its common stock, par value $0.01 per share, with an aggregate gross sales price of up to $500.0 million through a consortium of banks acting as sales agents, which is scheduled to expire September 15, 2026. Sales of the shares of common stock may be made, as needed, from time to time in “at the market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended, including by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise (i) at market prices prevailing at the time of sale, (ii) at prices related to prevailing market prices or (iii) as otherwise agreed to with the applicable sales agent. In addition, the Company may, from time to time, enter into separate forward sale agreements with one or more banks. The Company did not issue any shares under the ATM Program during the six months ended June 30, 2025. As of June 30, 2025, the Company had $362.5 million available under this ATM Program.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

During February 2018, the Company established a common share repurchase program, which is scheduled to expire on February 28, 2026. Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. During the six months ended June 30, 2025, the Company repurchased 3.0 million shares of common stock for an aggregate purchase price of $58.8 million (weighted average price of $19.61 per share). As of June 30, 2025, the Company had $166.0 million available under this common share repurchase program.

Dividends Declared

The following table provides a summary of the dividends declared per share:

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Common Shares $ 0.25000 $ 0.24000 $ 0.50000 $ 0.48000
Class L Depositary Shares $ 0.32031 $ 0.32031 $ 0.64062 $ 0.64062
Class M Depositary Shares $ 0.32813 $ 0.32813 $ 0.65626 $ 0.65626
Class N Depositary Shares $ 0.90625 $ 0.90625 $ 1.81250 $ 1.81250
  1. Supplemental Schedule of Non-Cash Investing / Financing Activities

The following schedule summarizes the non-cash investing and financing activities of the Company for the six months ended June 30, 2025 and 2024 (in thousands):

Six Months Ended June 30,
2025 2024
Disposition of real estate interests through the issuance of mortgage and other financing<br>   receivables $ - $ 175,420
Proceeds deposited in escrow through sale of real estate interests $ 48,699 $ -
Decrease in other investments through the issuance of mortgage and other financing receivables $ - $ 50,219
Surrender of common stock/units $ 11,646 $ 14,695
Declaration of dividends/distributions paid in succeeding period $ 6,364 $ 6,722
Capital expenditures accrual $ 45,193 $ 48,868
Lease liabilities arising from obtaining operating right-of-use assets $ 7,377 $ -
Decrease in redeemable noncontrolling interests’ carrying amount, net $ (555 ) $ (959 )
RPT Merger:
Real estate assets, net $ - $ 1,821,052
Investment in real estate joint ventures $ - $ 433,345
Investment in other investments $ - $ 12,672
Other assets and liabilities, net $ - $ (3,109 )
Notes payable $ - $ (821,500 )
Lease liabilities arising from obtaining operating right-of-use assets $ - $ (13,506 )
Noncontrolling interest/Limited members' capital $ - $ (20,975 )
Preferred stock/units issued in exchange for RPT preferred shares $ - $ (105,607 )
Common stock/units issued in exchange for RPT common shares $ - $ (1,166,775 )

The following table provides a reconciliation of cash, cash equivalents and restricted cash recorded on the Company’s Condensed Consolidated Balance Sheets to the Company’s Condensed Consolidated Statements of Cash Flows (in thousands):

As of June 30, 2025 As of December 31, 2024
Cash and cash equivalents $ 226,553 $ 688,622
Restricted cash 1,273 1,109
Total cash, cash equivalents and restricted cash $ 227,826 $ 689,731

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

  1. Commitments and Contingencies

Letters of Credit

The Company has issued letters of credit in connection with the completion and repayment guarantees, primarily on certain of the Company’s redevelopment projects and guaranty of payment related to the Company’s insurance program. At June 30, 2025, these letters of credit aggregated $43.7 million.

In addition, the Company provides a guaranty for the payment of any debt service shortfalls on the Sheridan Redevelopment Agency issued Series A bonds, which are tax increment revenue bonds issued in connection with a development project in Sheridan, Colorado. These tax increment revenue bonds have a balance of $36.2 million outstanding at June 30, 2025. The bonds are to be repaid with incremental sales and property taxes and a public improvement fee (“PIF”) to be assessed on current and future retail sales and, to the extent necessary, any amounts the Company may have to provide under a guaranty. The revenue generated from incremental sales, property taxes and PIF have satisfied the debt service requirements to date. The incremental taxes and PIF are to remain intact until the earlier of the payment of the bond liability in full or 2040.

Funding Commitments

The Company has investments with funding commitments of $30.9 million, of which $23.0 million has been funded as of June 30, 2025. In addition, the Company has mortgage and other financing receivables with undrawn loan advances of $32.2 million as of June 30, 2025.

Other

The Parent Company guarantees the unsecured debt instruments of Kimco OP, including the Credit Facility. These guarantees by the Parent Company are full, irrevocable, unconditional and absolute joint and several guarantees to the holders of each series of such unsecured debt instruments.

In connection with the construction of its development and redevelopment projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of June 30, 2025, there were $17.2 million in performance and surety bonds outstanding.

The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. Management believes that the final outcome of such matters will not have a material adverse effect on the financial position, results of operations or liquidity of the Company taken as a whole as of June 30, 2025.

  1. Accumulated Other Comprehensive (Loss)/Income (“AOCI”)

The following tables present the change in the components of AOCI for the three and six months ended June 30, 2025 and 2024 (in thousands):

Three Months Ended June 30, 2025 Six Months Ended June 30, 2025
Cash Flow Hedges for <br>Interest Payments Cash Flow Hedges for Interest Payments of Unconsolidated Investees Total Cash Flow Hedges for <br>Interest Payments Cash Flow Hedges for Interest Payments of Unconsolidated Investee Total
Balance at beginning of period $ (3,030 ) $ 2,119 $ (911 ) $ 7,239 $ 3,799 $ 11,038
Other comprehensive loss before <br>   reclassifications (4,148 ) (966 ) (5,114 ) (13,135 ) (2,280 ) (15,415 )
Amounts reclassed from AOCI (1,292 ) (473 ) (1,765 ) (2,574 ) (839 ) (3,413 )
Net current-period other <br>   comprehensive loss (5,440 ) (1,439 ) (6,879 ) (15,709 ) (3,119 ) (18,828 )
Balance at end of period $ (8,470 ) $ 680 $ (7,790 ) $ (8,470 ) $ 680 $ (7,790 )

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Three Months Ended June 30, 2024 Six Months Ended June 30, 2024
Cash Flow Hedges for <br>Interest Payments Cash Flow Hedges for <br>Interest Payments of <br>Unconsolidated Investees Total Cash Flow Hedges for <br>Interest Payments Cash Flow Hedges for <br>Interest Payments of <br>Unconsolidated Investees Total
Balance at beginning of period $ 6,459 $ 3,820 $ 10,279 $ - $ 3,329 $ 3,329
Other comprehensive income before <br>   reclassifications 3,445 1,579 5,024 11,982 2,070 14,052
Amounts reclassified from AOCI (2,084 ) (1,983 ) (4,067 ) (4,162 ) (1,983 ) (6,145 )
Net current-period other <br>   comprehensive income/(loss) 1,361 (404 ) 957 7,820 87 7,907
Balance at end of period $ 7,820 $ 3,416 $ 11,236 $ 7,820 $ 3,416 $ 11,236

On the Company’s Condensed Consolidated Statements of Income, unrealized gains and losses reclassified from AOCI related to (i) cash flow hedges for interest payments are included in Interest expense and (ii) cash flow hedges for interest payments of unconsolidated investees are included in Equity in income of joint ventures, net.

  1. Segment Reporting

The Company is an owner and operator of open-air, grocery-anchored shopping centers and mixed-used assets of which all the Company's properties are located within the U.S., inclusive of Puerto Rico. Management does not distinguish or group its operations on a geographical basis for purposes of allocating resources or capital. The Company reviews and evaluates operating and financial data for each property on an individual basis. As a result, each of the Company's individual properties is a separate operating segment. The Company defines its reportable segments to be in accordance with the method of internal reporting and the manner in which the Company's chief operating decision maker ("CODM"), makes key operating decisions, evaluates financial results, allocates resources and manages the Company's business. Accordingly, the Company aggregates its operating segments into a single reportable segment due to the similarities with regard to the nature and economics of its properties, tenants and operations, which are operated using consistent business strategies.

In accordance with ASC Topic 280 Segment Reporting, the Company’s CODM has been identified as the Chief Executive Officer. The CODM evaluates the Company’s portfolio and assesses the ongoing operations and performance of its consolidated properties and the Company's share of unconsolidated joint venture operations. The accounting policies of the reportable segments are the same as the Company’s accounting policies. Net Operating Income ("NOI") is the primary performance measure reviewed by the Company’s CODM to assess operating performance and consists only of revenues and expenses directly related to real estate rental operations. NOI is calculated by deducting property operating expenses from lease revenues and other property related income. NOI reflects property acquisitions and dispositions, occupancy levels, rental rate increases or decreases, and the recoverability of operating expenses. The Company’s calculation of NOI may not be directly comparable to similarly titled measures calculated by other REITs. The CODM does not review asset information as a measure to assess performance.

The following table presents accrual-based lease revenue and other property related income and operating expenses included in the Company's share of NOI for its consolidated and unconsolidated properties ("NOI at share") the periods presented (in thousands):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Revenues $ 520,930 $ 496,221 $ 1,052,216 $ 995,126
Operating expenses
Rent (4,242 ) (4,226 ) (8,426 ) (8,505 )
Real estate taxes (66,559 ) (66,182 ) (136,470 ) (129,542 )
Operating and maintenance (91,069 ) (87,749 ) (180,622 ) (173,523 )
Total operating expenses (161,870 ) (158,157 ) (325,518 ) (311,570 )
NOI from unconsolidated real estate joint ventures 49,585 49,805 100,585 99,833
NOI at share $ 408,645 $ 387,869 $ 827,283 $ 783,389

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents the reconciliation of NOI at share to Net income (in thousands):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
NOI at share $ 408,645 $ 387,869 $ 827,283 $ 783,389
Adjustments:
Management and other fee income 4,245 4,010 9,583 8,859
General and administrative (32,447 ) (33,090 ) (66,839 ) (69,388 )
Impairment charges (7,645 ) (201 ) (8,179 ) (3,902 )
Merger charges - - - (25,246 )
Depreciation and amortization (156,323 ) (148,148 ) (314,776 ) (302,867 )
Gain on sale of properties 38,922 75 39,809 393
Other income, net 2,903 910 3,119 10,480
Mortgage and other financing income, net 12,062 4,751 23,331 7,270
Loss on marketable securities, net (2 ) (6 ) (11 ) (27,692 )
Interest expense (81,204 ) (73,341 ) (161,581 ) (147,906 )
Provision for income taxes, net (366 ) (217 ) (830 ) (72,227 )
Equity in income of joint ventures, net 23,990 21,527 46,673 42,432
Equity in income of other investments, net 1,747 7,718 2,448 9,252
NOI from unconsolidated real estate joint ventures (49,585 ) (49,805 ) (100,585 ) (99,833 )
Net income $ 164,942 $ 122,052 $ 299,445 $ 113,014
  1. Earnings Per Share/Unit

The following table sets forth the reconciliation of the Company’s earnings and the weighted-average number of shares used in the calculation of basic and diluted earnings per share (amounts presented in thousands, except per share data):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Computation of Basic and Diluted Earnings Per Share:
Net income available to the Company's common shareholders $ 155,430 $ 111,777 $ 280,564 $ 92,861
Earnings attributable to participating securities (622 ) (700 ) (1,227 ) (1,380 )
Net income available to the Company’s common shareholders <br>   for basic and diluted earnings per share 154,808 111,077 279,337 91,481
Distributions on convertible units 9 - 18 -
Net income available to the Company’s common shareholders for diluted earnings per share $ 154,817 $ 111,077 $ 279,355 $ 91,481
Weighted average common shares outstanding – basic 674,613 671,198 675,837 670,658
Effect of dilutive securities (1):
Equity awards 369 129 317 129
Assumed conversion of convertible units 97 57 90 52
Weighted average common shares outstanding – diluted 675,079 671,384 676,244 670,839
Net income available to the Company's common shareholders:
Basic earnings per share $ 0.23 $ 0.17 $ 0.41 $ 0.14
Diluted earnings per share $ 0.23 $ 0.17 $ 0.41 $ 0.14
  • The effect of the assumed conversion of certain convertible units/preferred shares had an anti-dilutive effect upon the calculation of Net income available to the Company’s common shareholders per share. Accordingly, the impact of such conversions has not been included in the determination of diluted earnings per share calculations.

KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table sets forth the reconciliation of Kimco OP’s earnings and the weighted-average number of units used in the calculation of basic and diluted earnings per unit (amounts presented in thousands, except per unit data):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Computation of Basic and Diluted Earnings Per Unit:
Net income available to Kimco OP’s common unitholders $ 155,777 $ 111,968 $ 281,122 $ 93,037
Earnings attributable to participating securities (705 ) (729 ) (1,336 ) (1,438 )
Net income available to Kimco OP’s common unitholders <br>   for basic and diluted earnings per unit 155,072 111,239 279,786 91,599
Distributions on convertible units 9 - 18 -
Net income available to Kimco OP’s common unitholders for diluted earnings per unit $ 155,081 $ 111,239 $ 279,804 $ 91,599
Weighted average common units outstanding – basic 675,609 675,189 676,818 674,572
Effect of dilutive securities (1):
Unit awards 369 129 317 129
Assumed conversion of convertible units 97 56 90 52
Weighted average common units outstanding – diluted 676,075 675,374 677,225 674,753
Net income available to Kimco OP’s common unitholders:
Basic earnings per unit $ 0.23 $ 0.16 $ 0.41 $ 0.14
Diluted earnings per unit $ 0.23 $ 0.16 $ 0.41 $ 0.14
  • The effect of the assumed conversion of certain convertible units/preferred units had an anti-dilutive effect upon the calculation of Net income available to Kimco OP’s common unitholders per unit. Accordingly, the impact of such conversions has not been included in the determination of diluted earnings per unit calculations.

The Company’s unvested restricted share/unit awards contain non-forfeitable rights to distributions or distribution equivalents. The impact of the unvested restricted share/unit awards on earnings per share/unit has been calculated using the two-class method whereby earnings are allocated to the unvested restricted share/unit awards based on dividends declared and the unvested restricted shares/units’ participation rights in undistributed earnings.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This Quarterly Report on Form 10-Q, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with the safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words “believe,” “expect,” “intend,” “commit,” “anticipate,” “estimate,” “project,” “will,” “target,” “plan,” “forecast” or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which, in some cases, are beyond the Company’s control and could materially affect actual results, performance or achievements. Factors which may cause actual results to differ materially from current expectations include, but are not limited to, (i) financial disruption, changes in trade policies and tariffs, geopolitical challenges or economic downturn, including general adverse economic and local real estate conditions, (ii) the impact of competition, including the availability of acquisition or development opportunities and the costs associated with purchasing and maintaining assets, (iii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business, (iv) the reduction in the Company’s income in the event of multiple lease terminations by tenants or a failure of multiple tenants to occupy their premises in a shopping center, (v) the potential impact of e-commerce and other changes in consumer buying practices, and changing trends in the retail industry and perceptions by retailers or shoppers, including safety and convenience, (vi) the availability of suitable acquisition, disposition, development, redevelopment and merger opportunities, and the costs associated with purchasing and maintaining assets and risks related to acquisitions not performing in accordance with our expectations, (vii) the Company’s ability to raise capital by selling its assets, (viii) disruptions and increases in operating costs due to inflation and supply chain disruptions, (ix) risks associated with the development of mixed-use commercial properties, including risks associated with the development, and ownership of non-retail real estate, (x) changes in governmental laws and regulations, including, but not limited to, changes in data privacy, environmental (including climate change), safety and health laws, and management’s ability to estimate the impact of such changes, (xi) valuation and risks related to the Company’s joint venture and preferred equity investments and other investments, (xii) collectability of mortgage and other financing receivables, (xiii) impairment charges, (xiv) criminal cybersecurity attack disruptions, data loss or other security incidents and breaches, (xv) risks related to artificial intelligence, (xvi) impact of natural disasters and weather and climate-related events, (xvii) pandemics or other health crises, (xviii) our ability to attract, retain and motivate key personnel, (xix) financing risks, such as the inability to obtain equity, debt or other sources of financing or refinancing on favorable terms to the Company, (xx) the level and volatility of interest rates and management’s ability to estimate the impact thereof, (xxi) changes in the dividend policy for the Company’s common and preferred stock and the Company’s ability to pay dividends at current levels, (xxii) unanticipated changes in the Company’s intention or ability to prepay certain debt prior to maturity and/or hold certain securities until maturity, (xxiii) the Company’s ability to continue to maintain its status as a REIT for U.S. federal income tax purposes and potential risks and uncertainties in connection with its UPREIT structure, and (xxiv) other risks and uncertainties identified under Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024. Accordingly, there is no assurance that the Company’s expectations will be realized. The Company disclaims any intention or obligation to update the forward-looking statements, whether as a result of new information, future events or otherwise. You are advised to refer to any further disclosures the Company makes in other filings with the Securities and Exchange Commission (“SEC”).

The following discussion should be read in conjunction with the accompanying Condensed Consolidated Financial Statements and Notes thereto. These unaudited financial statements include all adjustments which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods presented, and all such adjustments are of a normal recurring nature.

Executive Overview

Kimco Realty Corporation and its subsidiaries (the “Parent Company”) operates as a Real Estate Investment Trust (“REIT”), of which substantially all of the Parent Company’s assets are held by, and substantially all of the Parent Company’s operations are conducted through, Kimco Realty OP, LLC (“Kimco OP”), either directly or through its subsidiaries, as the Parent Company’s operating company. The Parent Company is the managing member and exercises exclusive control over Kimco OP. As of June 30, 2025, the Parent Company owned 99.79% of the outstanding limited liability company interests (the “OP Units”) in Kimco OP. The terms “Kimco,” “the Company,” and “our” each refer to the Parent Company and Kimco OP, collectively, unless the context indicates otherwise. In statements regarding qualification as a REIT, such terms refer solely to Kimco Realty Corporation.

The Company is the leading owner and operator of high-quality, open-air, grocery-anchored shopping centers and mixed-use properties in the United States. The executive officers are engaged in the day-to-day management and operation of real estate exclusively with the Company, with nearly all operating functions, including leasing, asset management, maintenance, construction, legal, finance and accounting, administered by the Company. The Company’s mission is to create destinations for everyday living that inspire a sense of community and deliver value to our many stakeholders.

The Company is a self-administered REIT and has owned and operated open-air shopping centers for over 60 years. The Company has not engaged, nor does it expect to retain, any REIT advisors in connection with the operation of its properties. As of June 30, 2025, the Company had interests in 566 U.S. shopping center properties, aggregating 100.9 million square feet of gross leasable area (“GLA”), located in 30 states. In addition, the Company had 67 other property interests, primarily including net leased properties, preferred equity investments, and other investments, totaling 5.5 million square feet of GLA. The Company’s ownership interests in real estate consist of its consolidated portfolio and portfolios where the Company owns an economic interest, such as properties in the Company’s investment real estate management programs, where the Company partners with institutional investors and also retains management.

The Company’s primary business objective is to be the premier owner and operator of open-air, grocery-anchored shopping centers, and a growing portfolio of mixed-use assets, in the U.S. The Company believes it can achieve this objective by:

  • increasing the value of its existing portfolio of properties and generating higher levels of portfolio growth;
  • increasing cash flows for reinvestment and/or for distribution to shareholders while maintaining conservative payout ratios;
  • maintaining strong debt metrics and its A-/BBB+/Baa1 unsecured debt ratings;
  • continuing growth in desirable demographic areas with successful retailers, primarily focused on grocery anchors; and
  • increasing the number of entitlements for residential use.

RPT Merger

On January 2, 2024, RPT Realty (“RPT”) merged with and into the Company, with the Company continuing as the surviving public company (the “RPT Merger”), pursuant to the definitive merger agreement between the Company and RPT, which was entered into on August 28, 2023. As a result of the RPT Merger, the Company acquired 56 open-air shopping centers, including 43 wholly owned and 13 joint venture assets, comprising 13.3 million square feet of gross leasable area, to the Company’s existing portfolio. The Company also obtained RPT’s 6% stake in a 49-property net lease joint venture.

Economic Conditions and Regulatory Updates

The economy continues to face challenges, which could adversely impact the Company and its tenants, including elevated inflation, interest rates, tenant bankruptcies and international tariffs or other trade restrictions. These factors could slow economic growth and materially increase the cost of goods and services offered by the Company’s tenants, leading to lower profits. To the extent our tenants are unable to pass these costs on to their customers, our tenants’ operations could be adversely impacted, which could result in tenant bankruptcies, amongst other things, and could weaken demand by those tenants for our real estate and adversely impact the Company. In addition, these challenges could negatively affect the overall demand for retail space, including the demand for leasable space in the Company’s properties. Any of these factors could materially adversely impact the Company’s business, financial condition, results of operations or stock price. The Company continues to monitor economic, financial, and social conditions and will assess its asset portfolio for any impairment indicators. If the Company determines that any of its assets are impaired, the Company would be required to take impairment charges, and such amounts could be material.

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law, which included certain modifications to U.S. tax law, including certain provisions that affect the taxation of REITs and their investors. The Company is currently evaluating the provisions of the OBBBA, but does not expect the OBBBA to have a material impact on the Company’s financial position and/or results of operations.

Results of Operations

Comparison of the three and six months ended June 30, 2025 and 2024

The following table presents the comparative results from the Company’s Condensed Consolidated Statements of Income for the three and six months ended June 30, 2025, as compared to the corresponding periods in 2024 (in thousands, except per share data):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 Change 2025 2024 Change
Revenues
Revenues from rental properties, net $ 520,930 $ 496,221 $ 24,709 $ 1,052,216 $ 995,126 $ 57,090
Management and other fee income 4,245 4,010 235 9,583 8,859 724
Operating expenses
Rent (1) (4,242 ) (4,226 ) (16 ) (8,426 ) (8,505 ) 79
Real estate taxes (66,559 ) (66,182 ) (377 ) (136,470 ) (129,542 ) (6,928 )
Operating and maintenance (2) (91,069 ) (87,749 ) (3,320 ) (180,622 ) (173,523 ) (7,099 )
General and administrative (3) (32,447 ) (33,090 ) 643 (66,839 ) (69,388 ) 2,549
Impairment charges (7,645 ) (201 ) (7,444 ) (8,179 ) (3,902 ) (4,277 )
Merger charges - - - - (25,246 ) 25,246
Depreciation and amortization (156,323 ) (148,148 ) (8,175 ) (314,776 ) (302,867 ) (11,909 )
Gain on sale of properties 38,922 75 38,847 39,809 393 39,416
Other income/(expense)
Other income, net 2,903 910 1,993 3,119 10,480 (7,361 )
Mortgage and other financing income, net 12,062 4,751 7,311 23,331 7,270 16,061
Loss on marketable securities, net (2 ) (6 ) 4 (11 ) (27,692 ) 27,681
Interest expense (81,204 ) (73,341 ) (7,863 ) (161,581 ) (147,906 ) (13,675 )
Provision for income taxes, net (366 ) (217 ) (149 ) (830 ) (72,227 ) 71,397
Equity in income of joint ventures, net 23,990 21,527 2,463 46,673 42,432 4,241
Equity in income of other investments, net 1,747 7,718 (5,971 ) 2,448 9,252 (6,804 )
Net income attributable to noncontrolling interests (1,956 ) (2,314 ) 358 (3,642 ) (4,250 ) 608
Preferred dividends, net (7,556 ) (7,961 ) 405 (15,239 ) (15,903 ) 664
Net income available to the Company's common<br>   shareholders $ 155,430 $ 111,777 $ 43,653 $ 280,564 $ 92,861 $ 187,703
Net income available to the Company's common<br>   shareholders:
Diluted per common share $ 0.23 $ 0.17 $ 0.06 $ 0.41 $ 0.14 $ 0.27
  • Rent expense relates to ground lease payments for which the Company is the lessee.
  • Operating and maintenance expense consists of property related costs, including repairs and maintenance costs, roof repair, landscaping, parking lot repair, snow removal, utilities, property insurance costs, security and various other property related expenses.
  • General and administrative expense includes employee-related expenses (including salaries, bonuses, equity awards, benefits, severance costs and payroll taxes), professional fees, office rent, travel and entertainment costs and other company-specific expenses.

Net income available to the Company’s common shareholders was $155.4 million for the three months ended June 30, 2025, as compared to $111.8 million for the comparable period in 2024. On a diluted per common share basis, Net income available to the Company’s common shareholders for the three months ended June 30, 2025 was $0.23, as compared to $0.17 for the comparable period in 2024.

Net income available to the Company’s common shareholders was $280.6 million for the six months ended June 30, 2025, as compared to $92.9 million for the comparable period in 2024. On a diluted per common share basis, net income available to the Company’s common shareholders for the six months ended June 30, 2025 was $0.41 as compared to $0.14 for the comparable period in 2024.

The following describes the changes of certain line items included on the Company’s Condensed Consolidated Statements of Income that the Company believes changed significantly and affected Net income available to the Company’s common shareholders during the three and six months ended June 30, 2025, as compared to the corresponding periods in 2024.

Revenues from rental properties, net –

The increase in Revenues from rental properties, net of $24.7 million for the three months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily from (i) a net increase in revenues from tenants of $12.3 million, primarily due to an increase in leasing activity and net growth in the current portfolio, (ii) an increase in revenues of $12.1 million due to properties acquired during 2025 and 2024, (iii) an increase in lease termination fee income of $1.0 million and (iv) a net increase of $0.9 million due to changes in credit losses from tenants, partially offset by (v) a decrease in net straight-line rental income of $1.6 million, primarily due to changes in reserves.

The increase in Revenues from rental properties, net of $57.1 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily from (i) a net increase in revenues from tenants of $29.4 million, primarily due to an increase in leasing activity and net growth in the current portfolio, (ii) an increase in revenues of $22.1 million due to properties acquired during 2025 and 2024, (iii) an increase in lease termination fee income of $6.4 million and (iv) a net increase of $2.2 million due to changes in credit losses from tenants, partially offset by (v) a decrease in net straight-line rental income of $3.0 million, primarily due to changes in reserves.

Real estate taxes –

The increase in Real estate taxes of $6.9 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to (i) an increase of $1.7 million due to properties acquired during 2025 and 2024, (ii) an overall increase in assessed values in the current portfolio and (iii) timing of real estate tax refunds.

Operating and maintenance –

The increase in Operating and maintenance expense of $3.3 million for the three months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to (i) an increase in repairs and maintenance expense of $2.1 million and (ii) an increase of $1.4 million resulting from properties acquired during 2025 and 2024.

The increase in Operating and maintenance expense of $7.1 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to (i) an increase in repairs and maintenance expense of $3.3 million, (ii) an increase of $2.8 million resulting from properties acquired during 2025 and 2024 and (iii) an increase of $1.1 million in snow removal costs.

Impairment charges –

During the six months ended June 30, 2025 and 2024, the Company recognized impairment charges related to adjustments to property carrying values of $8.2 million and $3.9 million, respectively, for which the Company’s estimated fair values were primarily based upon signed contracts or letters of intent from third-party offers. These adjustments to property carrying values were recognized in connection with the Company’s efforts to market certain properties and management’s assessment as to the likelihood and timing of such potential transactions. Certain of the calculations to determine fair values utilized unobservable inputs and, as such, were classified as Level 3 of the FASB’s fair value hierarchy.

Merger charges –

During the six months ended June 30, 2024, the Company incurred costs of $25.2 million associated with the RPT Merger, primarily comprised of severance and professional and legal fees.

Depreciation and amortization –

The increase in Depreciation and amortization of $8.2 million for the three months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to (i) an increase of $7.6 million due to depreciation commencing on certain redevelopment projects and tenant improvement projects that were placed into service during 2025 and 2024 and (ii) an increase of $2.0 million resulting from properties acquired during 2025 and 2024, partially offset by (iii) a net decrease of $1.4 million due to fully depreciated assets and write-offs, primarily from demolition, vacated tenants and dispositions during 2025 and 2024.

The increase in Depreciation and amortization of $11.9 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to (i) an increase of $15.6 million due to depreciation commencing on certain redevelopment projects and tenant improvement projects that were placed into service during 2025 and 2024 and (ii) an increase of $4.7 million resulting from properties acquired during 2025 and 2024, partially offset by (iii) a net decrease of $8.4 million due to fully depreciated assets and write-offs, primarily from demolition, vacated tenants and dispositions during 2025 and 2024.

Gain on sale of properties –

During the six months ended June 30, 2025, the Company disposed of an operating property and two land parcels, in separate transactions, for an aggregate sales price of $51.9 million, which resulted in aggregate gains of $39.8 million. During the six months ended June 30, 2024, the Company disposed of 11 operating properties and seven land parcels, in separate transactions, for an aggregate sales price of $254.1 million, which resulted in aggregate gains of $0.4 million.

Other income, net –

The decrease in Other income, net of $7.4 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to (i) a decrease in interest income of $6.7 million resulting from lower cash balances during 2025 as compared to 2024, (ii) a decrease of $2.0 million from insurance proceeds received during 2025 as compared to 2024, (iii) a decrease in dividend income of $1.5 million, primarily due to the sale of the remaining shares of ACI common stock held by the Company during 2024, (iv) a decrease of $1.2 million from settlement of a contract during 2024 and (v) $1.0 million in higher costs associated with potential transactions for which the Company is no longer pursuing, partially offset by (vi) an increase of $5.5 million due to mark-to-market fluctuations of an embedded derivative liability.

Mortgage and other financing income, net –

The increase in Mortgage and other financing income, net of $7.3 million and $16.1 million for the three and six months ended June 30, 2025, respectively, as compared to the corresponding periods in 2024, is primarily due to (i) the Company’s origination of new loan financing during 2025 and 2024 and (ii) a change in provision for credit losses of $2.5 million and $4.5 million, during the three and six months ended June 30, 2025, respectively, partially offset by (iii) loan repayments during 2025 and 2024.

Loss on marketable securities, net –

The change in Loss on marketable securities, net of $27.7 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is due to mark-to-market fluctuations and the sale of the remaining shares of ACI common stock held by the Company during 2024.

Interest expense –

The increase in Interest expense of $7.9 million and $13.7 million for the three and six months ended June 30, 2025, respectively, as compared to the corresponding periods in 2024, is primarily due to (i) the issuance of unsecured notes and assumption of a mortgage loan during 2025 and 2024, partially offset by (ii) the paydown of unsecured notes and repayment of mortgage loans during 2025 and 2024.

Provision for income taxes, net –

The decrease in Provision for income taxes, net of $71.4 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to the Company’s sale of shares of ACI common stock during 2024, which generated taxable long-term capital gains. The Company retained the proceeds from the sale during 2024 and, as a result, recorded estimated federal and state income taxes on these gains.

Equity in income of joint ventures, net –

The increase in Equity in income of joint ventures, net of $4.2 million for the six months ended June 30, 2025, as compared to the corresponding period in 2024, is primarily due to (i) higher equity in income of $3.6 million, primarily due to the restructuring of a joint venture, and (ii) a decrease in interest expense of $1.3 million, partially offset by (iii) lower gains of $0.7 million recognized on sale of properties within various joint venture investments during 2025, as compared to 2024.

Equity in income of other investments, net –

The decrease in Equity in income of other investments, net of $6.0 million and $6.8 million for the three and six months ended June 30, 2025, respectively, as compared to the corresponding periods in 2024, is primarily due to profit participation from the sale of properties within the Company’s Preferred Equity Program during 2024.

Tenant Concentration

The Company reduces its operating and leasing risks through diversification achieved by the geographic distribution of its properties and a large tenant base. As of June 30, 2025, the Company had interests in 566 U.S. shopping center properties, aggregating 100.9 million square feet of GLA, located in 30 states. At June 30, 2025, the Company’s five largest tenants were The TJX Companies, Ross Stores, Burlington Stores, Inc., Amazon/Whole Foods and Albertsons Companies, Inc., which represented 3.8%, 1.8%, 1.8%, 1.7% and 1.7%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.

Liquidity and Capital Resources

The Company’s capital resources include accessing the public debt and equity capital markets, unsecured term loans, mortgages and construction loan financing, and immediate access to the Credit Facility with bank commitments of $2.0 billion, which can be increased to $2.75 billion through an accordion feature.

The Company anticipates that net cash flow provided by operating activities, borrowings under its Credit Facility and the issuance of equity, public debt, as well as other debt and equity alternatives, will provide the necessary capital required by the Company. The Company will continue to evaluate its capital requirements for both its short-term and long-term liquidity needs, which could be affected by various risks and uncertainties, including, but not limited to, the effects of the current economic environment, interest rates, inflation, international tariffs or other trade restrictions, and other risks detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2024 as supplemented by the risks and uncertainties identified under Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q.

The Company’s cash flow activities are summarized as follows (in thousands):

Six Months Ended June 30,
2025 2024
Cash, cash equivalents and restricted cash, beginning of the period $ 689,731 $ 783,757
Net cash flow provided by operating activities 529,216 470,150
Net cash flow used for investing activities (233,135 ) (10,532 )
Net cash flow used for financing activities (757,986 ) (1,115,820 )
Net change in cash, cash equivalents and restricted cash (461,905 ) (656,202 )
Cash, cash equivalents and restricted cash, end of the period $ 227,826 $ 127,555

Operating Activities

Net cash flow provided by operating activities for the six months ended June 30, 2025 was $529.2 million, as compared to $470.2 million for the comparable period in 2024. The increase of $59.0 million is primarily attributable to:

  • merger costs incurred in connection with the RPT Merger during 2024;
  • additional operating cash flow generated by operating properties acquired, offset by the disposition of operating properties during 2025 and 2024;
  • new leasing, expansion and re-tenanting of core portfolio properties; and
  • operating cash flow from new mortgage and other financing loans provided during 2025 and 2024; partially offset by
  • changes in operating assets and liabilities due to timing of receipts and payments; and
  • a decrease in distributions from the Company’s joint ventures programs.

Investing Activities

Net cash flow used for investing activities was $233.1 million for the six months ended June 30, 2025, as compared to $10.5 million for the comparable period in 2024.

Investing activities during the six months ended June 30, 2025 primarily consisted of:

Cash inflows:

  • $50.1 million from the collection of mortgage and other financing receivables; and
  • $15.4 million in reimbursements of investments in and advances to real estate joint ventures and other investments.

Cash outflows:

  • $138.2 million for improvements to operating real estate, primarily related to re-tenanting, tenant improvements and redevelopment projects;
  • $106.2 million for acquisition of an operating property;
  • $46.2 million for investment in mortgage and other financing receivables related to new mortgage and other financing receivables;
  • $5.9 million for investments in and advances to real estate joint ventures and other investments, primarily related to redevelopment projects within these portfolios; and
  • $5.4 million for investment in preferred stock and cost method investments.

Investing activities during the six months ended June 30, 2024 primarily consisted of:

Cash inflows:

  • $300.8 million in proceeds from sale of marketable securities, primarily due to the sale of 14.2 million shares of ACI common stock;
  • $70.3 million in proceeds from the sale of 11 operating properties and seven land parcels;
  • $61.1 million for collection of mortgage and other financing receivables; and
  • $21.0 million in reimbursements of investments in and advances to real estate joint ventures and other investments.

Cash outflows:

  • $178.9 million for investment in mortgage and other financing receivables related to new mortgage and other financing receivables;
  • $149.1 million for the acquisition of RPT;
  • $128.6 million for improvements to operating real estate, primarily related to re-tenanting, tenant improvements and the Company’s active redevelopment pipeline; and
  • $7.1 million for investments in and advances to real estate joint ventures and other investments, primarily related to redevelopment projects within these portfolios.

Acquisition of Operating Real Estate –

During the six months ended June 30, 2025, the Company expended $106.2 million for the acquisition of an operating real estate property. During the six months ended June 30, 2024, the Company expended $149.1 million in conjunction with the RPT Merger. The Company anticipates spending up to approximately $50.0 million to $150.0 million towards the acquisition of, or the purchase of additional interests in, operating properties for the remainder of 2025. The Company intends to fund these potential acquisitions with net cash flow provided by operating activities, proceeds from property dispositions, and/or availability under its Credit Facility.

Improvements to Operating Real Estate –

During the six months ended June 30, 2025 and 2024, the Company expended $138.2 million and $128.6 million, respectively, for improvements to operating real estate. These amounts consist of the following (in thousands):

Six Months Ended June 30,
2025 2024
Redevelopment and renovations $ 60,073 $ 52,843
Tenant improvements and tenant allowances 78,137 75,751
Total improvements $ 138,210 $ 128,594

The Company, on a selective basis, will redevelop projects or re-tenant its properties to maintain or enhance its competitive position in the marketplace. The Company is actively pursuing redevelopment opportunities within its operating portfolio, including residential and mixed-use components, which it believes will increase the overall value by bringing in new tenants and improving the assets’ value. The Company anticipates its capital commitment toward these redevelopment projects and re-tenanting efforts for the remainder of 2025 will be approximately $125.0 million to $175.0 million. The funding of these capital requirements will be from net cash flow provided by operating activities, proceeds from property dispositions, and/or availability under the Company’s Credit Facility.

Financing Activities

Net cash flow used for financing activities was $758.0 million for the six months ended June 30, 2025, as compared to $1.1 billion for the comparable period in 2024.

Financing activities during the six months ended June 30, 2025 primarily consisted of:

Cash inflows:

  • $500.0 million in proceeds from issuance of unsecured notes.

Cash outflows:

  • $740.5 million for repayments of unsecured notes;

  • $354.3 million of dividends paid;

  • $58.8 million for repurchase of common stock;

  • $55.0 million in principal payments on debt (related to the repayment of debt on three encumbered properties), including normal amortization on rental property debt;

  • $24.4 million in principal payments under finance lease obligations for the acquisition of the fee interest in two properties;

  • $11.6 million in shares repurchased for employee tax withholding on equity awards;

  • $6.6 million in financing origination costs; and

  • $5.3 million in redemption/distribution of noncontrolling interests.

Financing activities during the six months ended June 30, 2024 primarily consisted of:

Cash inflows:

  • $510.0 million in proceeds from issuance of unsecured term loans; and
  • $220.0 million in proceeds from the Credit Facility.

Cash outflows:

  • $1.2 billion in repayments of unsecured notes;
  • $310.0 million in repayments of unsecured term loans;
  • $338.1 million of dividends paid;
  • $14.7 million in shares repurchased for employee tax withholding on equity awards;
  • $16.7 million in principal payments on debt (related to the repayment of debt on three encumbered properties), including normal amortization on rental property debt; and
  • $8.3 million in redemption/distribution of noncontrolling interests.

The Company continually evaluates its debt maturities and, based on management’s current assessment, believes it has viable financing and refinancing alternatives that will not materially adversely impact its expected financial results. As of June 30, 2025, the Company had consolidated floating rate debt totaling $16.5 million. The Company continues to pursue borrowing opportunities with large commercial U.S. and global banks, select life insurance companies and certain regional and local banks.

Debt maturities for 2025 consist of $22.3 million of unconsolidated joint venture debt, assuming the utilization of extension options where available. The 2025 debt maturities on properties in the Company’s unconsolidated joint ventures are anticipated to be repaid through net cash flow provided by operating activities, debt refinancing, proceeds from sales, and/or partner capital contributions, as deemed appropriate.

The Company intends to maintain strong debt service coverage and fixed charge coverage ratios as part of its commitment to maintain its unsecured debt ratings. The Company may, from time to time, seek to obtain funds through additional common and preferred equity offerings, unsecured debt financings and/or mortgage/construction loan financings and other capital alternatives.

The Company utilizes the public debt and equity markets as its principal source of capital for its expansion needs through offerings of its public unsecured debt and equity. Proceeds from public capital market activities have been used for the purposes of, among other things, repaying indebtedness, acquiring interests in open-air, grocery anchored shopping centers and mixed-use assets, expanding and improving properties in the portfolio and other investments.

During January 2023, the Company filed a shelf registration statement on Form S-3, which is effective for a term of three years, for future unlimited offerings, from time to time, of debt securities, preferred stock, depositary shares, common stock and common stock warrants. The Company, pursuant to this shelf registration statement may, from time to time, offer for sale its senior unsecured debt securities for any general corporate purposes, including (i) funding specific liquidity requirements in its business, including property acquisitions, development and redevelopment costs and (ii) managing the Company’s debt maturities.

During January 2023, the Company filed a registration statement on Form S-8 for the 2020 Equity Participation Plan (the “2020 Plan”), which was previously approved by the Company’s stockholders and is a successor to the Restated Kimco Realty Corporation 2010 Equity Participation Plan that expired in March 2020. The 2020 Plan provides for a maximum of 10.0 million shares of the Company’s common stock to be reserved for the issuance of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalents, stock payments, deferred stock awards and long-term incentive plan units. At June 30, 2025, the Company had 2.9 million shares of common stock available for issuance under the 2020 Plan.

During February 2025, the Company filed a registration statement on Form S-8 for its 2025 Equity Participation Plan (the “2025 Plan”), which was approved by the Company’s stockholders on April 29, 2025 and is a successor to the 2020 Equity Participation Plan. The 2025 Plan provides for a maximum of 17.5 million shares of the Company’s common stock to be reserved for the issuance of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalents, stock payments, deferred stock awards and long-term incentive plan units. At June 30, 2025, the Company had 16.8 million shares of common stock available for issuance under the 2025 Plan.

Preferred Stock –

The Company’s Board of Directors authorized the repurchase of up to 891,000 depositary shares of Class L Preferred Stock, 1,047,000 depositary shares of Class M Preferred Stock, and 185,000 depositary shares of Class N Preferred Stock, representing an aggregate of up to 2,123 shares of the Company’s preferred stock, par value $1.00 per share, through February 28, 2026. During the six months ended June 30, 2025, the Company repurchased the following preferred stock:

Class of Preferred Stock Depositary Shares <br>Repurchased Purchase Price <br>(in thousands)
Class N 58,342 $ 3,481

Common Stock –

During September 2023, the Company established an at-the-market continuous offering program (the “ATM Program”) pursuant to which the Company may offer and sell, from time-to-time, shares of its common stock, par value $0.01 per share, with an aggregate gross sales price of up to $500.0 million through a consortium of banks acting as sales agents, which is scheduled to expire September 15, 2026. Sales of the shares of common stock may be made, as needed, from time to time, in “at the market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended, including by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise (i) at market prices prevailing at the time of sale, (ii) at prices related to prevailing market prices or (iii) as otherwise agreed to with the applicable sales agent. In addition, the Company may from time to time enter into separate forward sale agreements with one or more banks. The Company did not issue any shares under the ATM Program during the six months ended June 30, 2025. As of June 30, 2025, the Company had $362.5 million available under this ATM Program.

During February 2018, the Company established a common share repurchase program, which is scheduled to expire on February 28, 2026. Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. During the six months ended June 30, 2025, the Company repurchased 3.0 million shares of common stock for an aggregate purchase price of $58.8 million (weighted average price of $19.61 per share). As of June 30, 2025, the Company had $166.0 million available under this common share repurchase program.

Senior Notes –

The Company’s supplemental indenture governing its senior notes contains the following covenants, all of which the Company is compliant with:

Covenant Must Be As of June 30, 2025
Consolidated Indebtedness to Total Assets < 60% 37%
Consolidated Secured Indebtedness to Total Assets < 40% 2%
Consolidated Income Available for Debt Service to Maximum Annual Service Charge > 1.50x 4.6x
Unencumbered Total Asset Value to Consolidated Unsecured Indebtedness > 1.50x 2.5x

For a full description of the various indenture covenants refer to the Indenture dated September 1, 1993; the First Supplemental Indenture dated August 4, 1994; the Second Supplemental Indenture dated April 7, 1995; the Third Supplemental Indenture dated June 2, 2006; the Fourth Supplemental Indenture dated April 26, 2007; the Fifth Supplemental Indenture dated as of September 24, 2009; the Sixth Supplemental Indenture dated as of May 23, 2013; the Seventh Supplemental Indenture dated as of April 24, 2014; and the Eighth Supplemental Indenture dated as of January 3, 2023, each as filed with the SEC. In connection with the merger with Weingarten Realty Investors (“Weingarten”), the Company assumed senior unsecured notes which have covenants that are similar to the Company’s existing debt covenants for its senior unsecured notes. Please refer to the form Indenture included in Weingarten’s Registration Statement on Form S-3, filed with the SEC on February 10, 1995, the First Supplemental Indenture, dated as of August 2, 2006 filed with Weingarten’s Current Report on Form 8-K dated August 2, 2006, and the Second Supplemental Indenture, dated as of October 9, 2012 filed with Weingarten’s Current Report on Form 8-K dated October 9, 2012, each as filed with the SEC. See the Exhibits Index to our Annual Report on Form 10-K for the year ended December 31, 2024 for specific filing information.

During June 2025, the Company issued $500.0 million in senior unsecured notes, which are scheduled to mature in February 2036 and accrue interest at a rate of 5.30% per annum. The Company utilized the net proceeds from this offering for the repayment of outstanding borrowings under the Credit Facility and other general corporate purposes.

During the six months ended June 30, 2025, the Company fully repaid the following note payable (dollars in millions):

Type Date Paid Amount Repaid Interest Rate Maturity Date
Unsecured note Jun-25 $ 240.5 3.85% Jun-25
Unsecured note Feb-25 $ 500.0 3.30% Feb-25

Credit Facility –

The Company has a $2.0 billion Credit Facility with a group of banks. The Credit Facility is scheduled to expire in March 2027 with two additional six-month options to extend the maturity date, at the Company’s discretion, to March 2028. The Credit Facility can be increased to $2.75 billion through an accordion feature. The Credit Facility is a green credit facility tied to sustainability metric targets, as described in the agreement. The Credit Facility accrues interest at a rate of Adjusted Term SOFR, as defined in the terms of the Credit Facility, plus an applicable spread determined by the Company’s credit ratings. The interest rate can be further adjusted upward or downward based on the sustainability metric targets and the Company’s credit rating outlook, as defined in the agreement. As of June 30, 2025, the interest rate on the Credit Facility is Adjusted Term SOFR plus 68.5 basis points (5.11% as of June 30, 2025) after reductions for sustainability metrics achieved and an upgraded credit rating profile. Pursuant to the terms of the Credit Facility, the Company is subject to certain covenants. As of June 30, 2025, the Credit Facility had no outstanding balance and no appropriations for letters of credit.

Pursuant to the terms of the Credit Facility, the Company, among other things, is subject to maintenance of various covenants. The Company is currently in compliance with these covenants. The financial covenants for the Credit Facility are as follows:

Covenant Must Be As of June 30, 2025
Total Indebtedness to Gross Asset Value (“GAV”) < 60% 35%
Total Priority Indebtedness to GAV < 35% 2%
Unencumbered Asset Net Operating Income to Total Unsecured Interest Expense > 1.75x 4.4x
Fixed Charge Total Adjusted EBITDA to Total Debt Service > 1.50x 4.0x

Term Loans –

The Company has $310.0 million of unsecured term loans ( the “Term Loans”) with a group of banks, which are scheduled to expire between November 2026 to February 2028. The Term Loans accrue interest at the rate of Adjusted Term SOFR plus an applicable spread determined by the Company’s credit rating outlook and sustainability metric targets, as described in the agreement. As of June 30, 2025, the interest rates on the Term Loans is Adjusted Term SOFR plus 81.0 basis points after reductions for an upgraded credit rating profile and sustainability metrics achieved. As of June 30, 2025, the Company had 20 swap rate agreements with various lenders swapping the interest rates on the Term Loans to all-in fixed rates ranging from 4.5793% to 4.7801%.

The Company has a $550.0 million unsecured term loan credit facility (the “Term Loan Credit Facility”) with a group of banks, which is scheduled to mature in January 2026 with three one-year options to extend the maturity date, at the Company’s discretion, to January 2029. The Term Loan Credit Facility accrues interest at a spread (currently 80.0 basis points after reductions for an upgraded credit rating profile) to the Adjusted Term SOFR Rate (as defined in the credit agreement) that fluctuates in accordance with changes in Kimco’s senior debt ratings. As of June 30, 2025, the Company had six swap rate agreements with various lenders swapping the overall interest rate on the $550.0 million Term Loan Credit Facility to an all-in fixed rate of 4.6122%.

Mortgages Payable –

During the six months ended June 30, 2025, the Company repaid $48.9 million of mortgage debt (including fair market value adjustment of $0.1 million) that encumbered three operating properties.

In addition to the public equity and debt markets as capital sources, the Company may, from time to time, obtain mortgage financing on selected properties to partially fund the capital needs of its real estate re-development and re-tenanting projects. As of June 30, 2025, the Company had over 525 unencumbered property interests in its portfolio.

Letters of Credit –

The Company has issued letters of credit in connection with the completion and repayment guarantees, primarily on certain of the Company’s redevelopment projects and guaranty of payment related to the Company’s insurance program. At June 30, 2025, these letters of credit aggregated $43.7 million.

In addition, the Company provides a guaranty for the payment of any debt service shortfalls on the Sheridan Redevelopment Agency issued Series A bonds, which are tax increment revenue bonds issued in connection with a development project in Sheridan, Colorado. These tax increment revenue bonds have a balance of $36.2 million outstanding at June 30, 2025. The bonds are to be repaid with incremental sales and property taxes and a public improvement fee ("PIF") to be assessed on current and future retail sales and, to the extent necessary, any amounts we may have to provide under a guaranty. The revenue generated from incremental sales, property taxes and PIF have satisfied the debt service requirements to date. The incremental taxes and PIF are to remain intact until the earlier of the payment of the bond liability in full or 2040.

Funding Commitments –

The Company has investments with funding commitments of $30.9 million, of which $23.0 million has been funded as of June 30, 2025. In addition, the Company has mortgage and other financing receivables with undrawn loan advances of $32.2 million as of June 30, 2025.

Other –

The Parent Company guarantees the unsecured debt instruments of Kimco OP, including the Credit Facility. These guarantees by the Parent Company are full, irrevocable, unconditional and absolute joint and several guarantees to the holders of each series of such unsecured debt instruments.

In connection with the construction of its development/redevelopment projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of June 30, 2025, the Company had $17.2 million in performance and surety bonds outstanding.

Dividends –

In connection with its intention to continue to qualify as a REIT for U.S. federal income tax purposes, the Company expects to continue paying regular dividends to its stockholders. These dividends will be paid from operating cash flows. The Company’s Board of Directors will continue to evaluate the Company’s dividend policy on a quarterly basis as it monitors sources of capital and evaluates the impact of the economy and capital markets availability on operating fundamentals. Since cash used to pay dividends reduces amounts available for capital investment, the Company generally intends to maintain a dividend payout ratio which reserves such amounts as it considers necessary for the expansion and renovation of shopping centers in its portfolio, debt reduction, the acquisition of interests in new properties and other investments as suitable opportunities arise and such other factors as the Board of Directors considers appropriate. Cash dividends paid for common and preferred stock for the six months ended June 30, 2025 and 2024 were $354.3 million and $338.1 million, respectively.

Although the Company receives substantially all of its rental payments on a monthly basis, it generally intends to continue paying dividends quarterly. Amounts accumulated in advance of each quarterly distribution will be invested by the Company in short-term money market or other suitable instruments. The Company’s objective is to establish a dividend level that maintains compliance with the Company’s REIT taxable income distribution requirements. On April 28, 2025, the Company’s Board of Directors declared a quarterly dividend with respect to the Company’s classes of cumulative redeemable preferred shares (Classes L, M and N), which were paid on July 15, 2025, to shareholders of record on July 1, 2025. In addition, the Company’s Board of Directors declared a quarterly cash dividend of $0.25 per common share, which was paid on June 20, 2025 to shareholders of record on June 6, 2025.

On July 29, 2025, the Company’s Board of Directors declared quarterly dividends with respect to the Company’s classes of cumulative redeemable preferred shares (Classes L, M and N), which are scheduled to be paid on October 15, 2025, to shareholders of record on October 1, 2025. Additionally, the Company’s Board of Directors declared a quarterly cash dividend of $0.25 per common share payable on September 19, 2025 to shareholders of record on September 5, 2025.

Effects of Inflation

Many of the Company’s long-term leases contain provisions designed to help mitigate the adverse impact of inflation. Such provisions include clauses enabling the Company to receive payment of additional rent calculated as a percentage of tenants’ gross sales above pre-determined thresholds, which generally increase as prices rise, and/or as a result of escalation clauses, which generally increase rental rates during the terms of the leases. Such escalation clauses often include increases based upon changes in the consumer price index or similar inflation indices. In addition, many of the Company’s leases are for terms of less than 10 years, which permits the Company to seek to increase rents to market rates upon renewal. To assist in partially mitigating the Company’s exposure to increases in costs and operating expenses, including common area maintenance costs, real estate taxes and insurance, resulting from inflation, the Company’s leases include provisions that either (i) require the tenant to pay an allocable share of these operating expenses or (ii) contain fixed contractual amounts, which include escalation clauses, to reimburse these operating expenses.

Funds From Operations (“FFO”)

FFO is a supplemental non-GAAP financial measure utilized to evaluate the operating performance of real estate companies. NAREIT defines FFO as net income available to the Company’s common shareholders computed in accordance with GAAP, excluding (i) depreciation and amortization related to real estate, (ii) gains or losses from sales of certain real estate assets, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) after adjustments for unconsolidated partnerships and joint ventures calculated to reflect FFO on the same basis. The Company also made an election, in accordance with the NAREIT Funds From Operations White Paper-2018 Restatement, to exclude from its calculation of FFO (i) gains and losses on the sale of assets

and impairments of assets incidental to its main business and (ii) mark-to-market changes in the value of its equity securities. As such, the Company does not include gains/impairments on land parcels, mark-to-market gains/losses from marketable securities, allowance for credit losses on mortgage receivables, gains/impairments on other investments or other amounts considered incidental to its main business in NAREIT defined FFO, including any applicable tax effect and noncontrolling interest.

The Company presents FFO available to the Company’s common shareholders as it considers it an important supplemental measure of our operating performance and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO available to the Company’s common shareholders when reporting results. Comparison of our presentation of FFO available to the Company’s common shareholders to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of the NAREIT definition used by such REITs.

FFO is a supplemental non-GAAP financial measure of real estate companies’ operating performances, which does not represent cash generated from operating activities in accordance with GAAP, and therefore, should not be considered an alternative for net income or cash flows from operations as a measure of liquidity.

The Company’s reconciliation of Net income available to the Company’s common shareholders to FFO available to the Company’s common shareholders is reflected in the table below (amounts presented in thousands, except per share data).

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Net income available to the Company’s common <br>   shareholders $ 155,430 $ 111,777 $ 280,564 $ 92,861
Gain on sale of properties (38,922 ) (75 ) (39,809 ) (393 )
Gain on sale of joint venture properties - (1,441 ) (784 ) (1,494 )
Depreciation and amortization - real estate related 155,145 146,892 312,377 300,354
Depreciation and amortization - real estate joint ventures 22,510 21,345 43,865 42,943
Impairment charges (including real estate joint ventures) 7,645 2,701 8,179 8,403
Profit participation from other investments, net (630 ) (5,647 ) (846 ) (5,676 )
(Gain)/loss on derivative/marketable securities, net (2,773 ) 1,243 (2,448 ) 30,771
(Benefit)/provision for income taxes, net (1) (218 ) (94 ) (138 ) 71,647
Noncontrolling interests (1) (632 ) (743 ) (1,509 ) (1,629 )
FFO available to the Company’s common shareholders (3) $ 297,555 $ 275,958 $ 599,451 $ 537,787
Weighted average shares outstanding for FFO calculations:
Basic 674,613 671,198 675,837 670,658
Units 3,319 3,290 3,317 3,264
Convertible preferred shares 3,186 4,265 3,234 4,265
Dilutive effect of equity awards 369 129 317 129
Diluted (2) 681,487 678,882 682,705 678,316
FFO per common share – basic $ 0.44 $ 0.41 $ 0.89 $ 0.80
FFO per common share – diluted (2) (3) $ 0.44 $ 0.41 $ 0.88 $ 0.80
  • Related to gains, impairments, depreciation on properties and gains/(losses) on sales of marketable securities and derivatives, where applicable.
  • Reflects the potential impact of convertible preferred shares and certain units if converted to common stock at the beginning of the period. FFO available to the Company’s common shareholders would be increased by $2,075 and $2,464 for the three months ended June 30, 2025 and 2024, respectively. FFO available to the Company’s common shareholders would be increased by $4,158 and $4,907 for the six months ended June 30, 2025 and 2024, respectively. The effect of other certain convertible units would have an anti-dilutive effect upon the calculation of FFO available to the Company’s common shareholders per share. Accordingly, the impact of such conversion has not been included in the determination of diluted FFO per share calculations.
  • Includes merger-related charges of $25.2 million for the six months ended June 30, 2024.

Same Property Net Operating Income (“Same property NOI”)

Same property NOI is a supplemental non-GAAP financial measure of real estate companies’ operating performance and should not be considered an alternative to net income in accordance with GAAP or as a measure of liquidity. The Company considers Same property NOI as an important operating performance measure frequently used by analysts and investors because it includes only the net operating income of operating properties that have been owned and stabilized by the Company for the entire current and prior year reporting periods. It excludes properties under redevelopment, development and pending stabilization; properties are deemed stabilized at the earlier of (i) reaching 90% leased or (ii) one year following a project’s inclusion in operating real estate. Same property NOI assists in eliminating disparities due to the development, redevelopment, acquisition and disposition of properties during the periods presented, and thus provides a more consistent performance measure for the comparison of the Company's properties.

Same property NOI is calculated using revenues from rental properties (excluding straight-line rent adjustments, lease termination fee income, net, and amortization of above/below-market rents), less charges for credit losses, operating and maintenance expense, real estate taxes and rent expense, plus the Company’s proportionate share of Same property NOI from unconsolidated real estate joint ventures, calculated on the same basis. The Company’s method of calculating Same property NOI available to the Company’s common shareholders, which may differ from methods used by other REITs and, accordingly, may not be comparable to such other REITs, discloses with and without the impact from development projects.

The following is a reconciliation of Net income available to the Company’s common shareholders to Same property NOI (in thousands):

Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Net income available to the Company’s common shareholders $ 155,430 $ 111,777 $ 280,564 $ 92,861
Adjustments:
Management and other fee income (4,245 ) (4,010 ) (9,583 ) (8,859 )
General and administrative 32,447 33,090 66,839 69,388
Impairment charges 7,645 201 8,179 3,902
Merger charges - - - 25,246
Depreciation and amortization 156,323 148,148 314,776 302,867
Gain on sale of properties (38,922 ) (75 ) (39,809 ) (393 )
Other income, net (2,903 ) (910 ) (3,119 ) (10,480 )
Mortgage and other financing income, net (12,062 ) (4,751 ) (23,331 ) (7,270 )
Loss on marketable securities, net 2 6 11 27,692
Interest expense 81,204 73,341 161,581 147,906
Provision for income taxes, net 366 217 830 72,227
Equity in income of other investments, net (1,747 ) (7,718 ) (2,448 ) (9,252 )
Net income attributable to noncontrolling interests 1,956 2,314 3,642 4,250
Preferred dividends, net 7,556 7,961 15,239 15,903
RPT same property NOI (1) - - - 606
Non same property net operating income (20,112 ) (11,074 ) (44,546 ) (27,857 )
Non-operational expense from joint ventures, net 25,596 28,277 53,912 57,402
Same property NOI $ 388,534 $ 376,794 $ 782,737 $ 756,139
  • Amount represents the Same property NOI from RPT properties, not included in the Company's Net income available to the Company's common shareholders.

Same property NOI increased by $11.7 million, or 3.1%, for the three months ended June 30, 2025, as compared to the corresponding period in 2024. This increase is primarily the result of (i) an increase of $10.0 million in minimum rent, primarily related to strong leasing activity, and (ii) an increase in other revenues of $1.6 million.

Same property NOI increased by $26.6 million, or 3.5%, for the six months ended June 30, 2025, as compared to the corresponding period in 2024. This increase is primarily the result of (i) an increase of $22.8 million in minimum rent, primarily related to strong leasing activity, and (ii) an increase in other revenues of $3.2 million.

Leasing Activity

During the six months ended June 30, 2025, the Company executed 854 leases totaling 6.3 million square feet in the Company’s consolidated operating portfolio, comprised of 264 new leases and 590 renewals and options. The leasing costs associated with these new leases are estimated to aggregate $67.3 million, or $39.85 per square foot. These costs include $51.8 million of tenant improvements and $15.5 million of external leasing commissions. The average rent per square foot for (i) new leases was $23.42 and (ii) renewals and options was $20.37.

Tenant Lease Expirations

At June 30, 2025, the Company has a total of 9,386 leases in its consolidated operating portfolio. The following table sets forth the aggregate lease expirations for each of the next ten years, assuming no renewal options are exercised. For purposes of the table, the Total Annual Base Rent Expiring represents annualized rental revenue, excluding the impact of straight-line rent, for each lease that expires during the respective year. Amounts in thousands, except for number of leases data:

Year Ending <br>December 31, Number of Leases<br> Expiring Square Feet <br>Expiring Total Annual Base Rent Expiring % of Gross <br>Annual Rent
(1) 143 499 $ 10,879 0.7 %
2025 300 1,694 $ 32,330 2.1 %
2026 1,221 9,763 $ 170,826 11.3 %
2027 1,380 10,490 $ 201,033 13.3 %
2028 1,413 11,227 $ 223,197 14.8 %
2029 1,284 9,989 $ 199,535 13.2 %
2030 1,049 7,954 $ 170,518 11.3 %
2031 554 4,180 $ 86,754 5.8 %
2032 454 3,332 $ 65,566 4.4 %
2033 469 3,686 $ 72,659 4.8 %
2034 433 3,392 $ 76,135 5.1 %
2035 353 3,435 $ 67,861 4.5 %
  • Leases currently under month-to-month lease or in process of renewal.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

The Company’s primary market risk exposure is interest rate risk. The Company periodically evaluates its exposure to short-term interest rates and will, from time-to-time, enter into interest rate protection agreements, which mitigate, but do not eliminate, the effect of changes in interest rates on its floating-rate debt. As of June 30, 2025, the Company had 26 interest rate swaps with notional amounts aggregating to $860.0 million. The interest rate swap agreements are designated as cash flow hedges and are held by the Company to reduce the impact of changes in interest rates on variable rate debt. The hedged debt is reflected as fixed rate unsecured debt in the table below. The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes.

The following table presents the carrying value of the Company’s aggregate fixed rate and variable rate debt obligations outstanding, including fair market value adjustments and unamortized deferred financing costs, as of June 30, 2025, with corresponding weighted-average interest rates sorted by maturity date. In addition, the following table presents the fair value of the Company’s debt obligations outstanding, including fair market value adjustments and unamortized deferred financing costs. The table does not include extension options where available (amounts in millions).

2025 2026 2027 2028 2029 Thereafter Total Fair Value
Secured Debt
Fixed Rate $ - $ - $ 32.9 $ 128.9 $ 251.9 $ 11.3 $ 425.0 $ 408.5
Average Interest Rate - - 4.01 % 4.47 % 4.51 % 3.33 % 4.43 %
Variable Rate $ - $ 16.5 $ - $ - $ - $ - $ 16.5 $ 16.4
Average Interest Rate - 5.62 % - - - - 5.62 %
Unsecured Debt
Fixed Rate $ - $ 1,376.0 $ 585.0 $ 518.0 $ - $ 5,238.2 $ 7,717.2 $ 7,294.9
Average Interest Rate - 3.74 % 4.21 % 2.55 % - 4.17 % 3.99 %

Based on the Company’s variable-rate debt balances, interest expense would have increased by $0.1 million for the six months ended June 30, 2025 if short-term interest rates were 1.0% higher.

Item 4. Controls and Procedures.

Controls and Procedures (Kimco Realty Corporation)

The Parent Company’s management, with the participation of the Parent Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Parent Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the Parent Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Parent Company’s disclosure controls and procedures are effective.

There have not been any changes in the Parent Company’s internal control over financial reporting during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Controls and Procedures (Kimco Realty OP, LLC)

Kimco OP’s management, with the participation of the Kimco OP’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of Kimco OP’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on such evaluation, Kimco OP’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, Kimco OP’s disclosure controls and procedures are effective.

There have not been any changes in Kimco OP’s internal control over financial reporting during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, Kimco OP’s internal control over financial reporting.

Item 5. Other Information.

Rule 10b5-1 Plan Elections

During the three months ended June 30, 2025, no director or officer (as defined in § 240.16a–1(f) of the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

Recent Tax Law Changes

On July 4, 2025, the OBBBA was enacted into law, which included certain modifications to U.S. tax law, including certain provisions that affect the taxation of REITs and their investors. The OBBBA permanently extended certain provisions that were enacted in the Tax Cuts and Jobs Act of 2017. Such extensions included the permanent extension of the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers. The OBBBA also increased the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries (“TRSs”) (the permissible value of TRS securities that a REIT may hold) from 20% to 25% of the value of the REIT’s total assets for taxable years beginning after December 31, 2025. The Company is currently evaluating the provisions of the OBBBA, but does not expect the OBBBA to have a material impact on the Company’s financial position and/or results of operations.

As a result of the OBBBA, the discussion under the heading “United States Federal Income Tax Considerations” in Exhibit 99.1 to this Quarterly Report (incorporated herein by reference) supersedes and replaces the discussion under the heading “United States Federal Income Tax Considerations” in the prospectus dated January 3, 2023, which is part of Kimco Realty Corporation’s and Kimco Realty OP, LLC’s Registration Statement on Form S-3 (Registration Nos. 333-269102 and 333-269102-01) filed with the SEC on January 3, 2023.

Item 6. Exhibits.

Exhibits –

4.1 Agreement to File Instruments

Kimco Realty Corporation (the “Registrant”) hereby agrees to file with the Securities and Exchange Commission, upon request of the Commission, all instruments defining the rights of holders of long-term debt of the Registrant and its consolidated subsidiaries, and for any of its unconsolidated subsidiaries for which financial statements are required to be filed, and for which the total amount of securities authorized thereunder does not exceed 10 percent of the total assets of the Registrant and its subsidiaries on a consolidated basis.

10.1 Kimco Realty Corporation 2025 Equity Participation Plan (incorporated by reference to Annex B to Kimco Realty Corporation’s Definitive Proxy Statement on Schedule 14A, filed on March 19, 2025)
31.1* Certification of the Chief Executive Officer of Kimco Realty Corporation, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2* Certification of the Chief Financial Officer of Kimco Realty Corporation, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.3* Certification of the Chief Executive Officer of Kimco Realty OP, LLC, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.4* Certification of the Chief Financial Officer of Kimco Realty OP, LLC, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1** Certification of the Chief Executive Officer of Kimco Realty Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2** Certification of the Chief Financial Officer of Kimco Realty Corporation pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.3** Certification of the Chief Executive Officer of Kimco Realty OP, LLC, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.4** Certification of the Chief Financial Officer of Kimco Realty OP, LLC, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.1* United States Federal Income Tax Considerations
101.INS* 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 document.
101.SCH* Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents
104* Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith.

** Furnished herewith.

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.

KIMCO REALTY CORPORATION
August 1, 2025 /s/ Conor C. Flynn
(Date) Conor C. Flynn
Chief Executive Officer
August 1, 2025 /s/ Glenn G. Cohen
(Date) Glenn G. Cohen
Chief Financial Officer

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.

KIMCO REALTY OP, LLC<br><br>BY: KIMCO REALTY CORPORATION, managing member
August 1, 2025 /s/ Conor C. Flynn
(Date) Conor C. Flynn
Chief Executive Officer
August 1, 2025 /s/ Glenn G. Cohen
(Date) Glenn G. Cohen
Chief Financial Officer

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Conor C. Flynn, certify that:

  1. I have reviewed this Quarterly Report on Form 10-Q of Kimco Realty Corporation;

  2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

  3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

  4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

  • Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
  • Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
  • Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
  • Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
  1. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
  • All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
  • Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 1, 2025
/s/ Conor C. Flynn
Conor C. Flynn
Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Glenn G. Cohen, certify that:

  1. I have reviewed this Quarterly Report on Form 10-Q of Kimco Realty Corporation;

  2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

  3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

  4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

  • Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
  • Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
  • Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
  • Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
  1. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
  • All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
  • Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 1, 2025 /s/ Glenn G. Cohen
Glenn G. Cohen
Chief Financial Officer

EX-31.3

Exhibit 31.3

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Conor C. Flynn, certify that:

  • I have reviewed this Quarterly Report on Form 10-Q of Kimco Realty OP, LLC;
  • Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
  • Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
  • The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
  • Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
  • Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
  • Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
  • Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
  • The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
  • All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
  • Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 1, 2025
/s/ Conor C. Flynn
Conor C. Flynn
Chief Executive Officer

EX-31.4

Exhibit 31.4

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Glenn G. Cohen, certify that:

  1. I have reviewed this Quarterly Report on Form 10-Q of Kimco Realty OP, LLC;

  2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

  3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

  4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

  • Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
  • Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
  • Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
  • Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
  1. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
  • All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
  • Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: August 1, 2025 /s/ Glenn G. Cohen
Glenn G. Cohen
Chief Financial Officer

EX-32.1

Exhibit 32.1

Section 1350 Certification

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kimco Realty Corporation (the “Company”) hereby certifies, to such officer’s knowledge, that:

  • the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2025 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
  • the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: August 1, 2025 /s/ Conor C. Flynn
Conor C. Flynn
Chief Executive Officer

EX-32.2

Exhibit 32.2

Section 1350 Certification

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kimco Realty Corporation (the “Company”) hereby certifies, to such officer’s knowledge, that:

  • the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended June 30, 2025 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
  • the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: August 1, 2025 /s/ Glenn G. Cohen
Glenn G. Cohen
Chief Financial Officer

EX-32.3

Exhibit 32.3

Section 1350 Certification

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kimco Realty OP, LLC (“Kimco OP”) hereby certifies, to such officer’s knowledge, that:

  • the accompanying Quarterly Report on Form 10-Q of Kimco OP for the quarterly period ended June 30, 2025 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

  • the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Kimco OP.

Date: August 1, 2025 /s/ Conor C. Flynn
Conor C. Flynn
Chief Executive Officer

EX-32.4

Exhibit 32.4

Section 1350 Certification

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kimco Realty OP, LLC (“Kimco OP”) hereby certifies, to such officer’s knowledge, that:

  • the accompanying Quarterly Report on Form 10-Q of Kimco OP for the quarterly period ended June 30, 2025 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

  • the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Kimco OP.

Date: August 1, 2025 /s/ Glenn G. Cohen
Glenn G. Cohen
Chief Financial Officer

EX-99.1

Exhibit 99.1

UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

The following is a general summary of certain material U.S. federal income tax considerations regarding our election to be taxed as a real estate investment trust (“REIT”) and the purchase, ownership or disposition of the Company’s capital stock or Kimco OP’s debt securities. Supplemental U.S. federal income tax considerations relevant to holders of the securities offered by the prospectus dated January 3, 2023 (the “Prospectus”) (including warrants, preferred stock and depositary shares) may be provided in the prospectus supplement that relates to those securities. This summary replaces and supersedes in all respects the information contained under the heading “United States Federal Income Tax Considerations” that is contained in the Prospectus, which is part of Kimco Realty Corporation’s and Kimco Realty OP, LLC’s Registration Statement on Form S-3 (Registration Nos. 333-269102 and 333-269102-01) filed with the Securities and Exchange Commission on January 3, 2023. For purposes of this discussion, references to “we,” “our” and “us” mean only Kimco Realty Corporation and do not include any of its subsidiaries, except as otherwise indicated. This summary is for general information only and is not tax advice. The information in this summary is based on:

  • the Internal Revenue Code of 1986, as amended (the “Code”);
  • current, temporary and proposed Treasury regulations promulgated under the Code (the “Treasury Regulations”);
  • the legislative history of the Code;
  • administrative interpretations and practices of the Internal Revenue Service (the “IRS”); and
  • court decisions;

in each case, as of the date of this Quarterly Report on Form 10-Q. In addition, the administrative interpretations and practices of the IRS include its practices and policies as expressed in private letter rulings that are not binding on the IRS except with respect to the particular taxpayers who requested and received those rulings. The sections of the Code and the corresponding Treasury Regulations that relate to qualification and taxation as a REIT are highly technical and complex. The following discussion sets forth certain material aspects of the sections of the Code that govern the U.S. federal income tax treatment of a REIT and its stockholders and the holders of Kimco OP’s debt securities. This summary is qualified in its entirety by the applicable Code provisions, Treasury Regulations, and administrative and judicial interpretations thereof. Potential tax reforms may result in significant changes to the rules governing U.S. federal income taxation. New legislation, Treasury Regulations, administrative interpretations and practices and/or court decisions may significantly and adversely affect our ability to qualify as a REIT, the U.S. federal income tax consequences of such qualification, or the U.S. federal income tax consequences of an investment in us, including those described in this discussion. Moreover, the law relating to the tax treatment of other entities, or an investment in other entities, could change, making an investment in such other entities more attractive relative to an investment in a REIT. Any such changes could apply retroactively to transactions preceding the date of the change. We have not requested, and do not plan to request, any rulings from the IRS that we qualify as a REIT, and the statements in the Prospectus and this Exhibit 99.1 to the Quarterly Report on Form 10-Q are not binding on the IRS or any court. Thus, we can provide no assurance that the tax considerations contained in this discussion will not be challenged by the IRS or will be sustained by a court if challenged by the IRS. This summary does not discuss any state, local or non-U.S. tax consequences, or any tax consequences arising under any U.S. federal tax laws other than U.S. federal income tax laws, associated with the purchase, ownership or disposition of our capital stock or Kimco OP’s debt securities, or our election to be taxed as a REIT.

You are urged to consult your tax advisors regarding the tax consequences to you of:

  • the purchase, ownership and disposition of our capital stock or Kimco OP’s debt securities, including the U.S. federal, state, local, non-U.S. and other tax consequences;
  • our election to be taxed as a REIT for U.S. federal income tax purposes; and
  • potential changes in applicable tax laws.

Taxation of Our Company

General. Prior to the Reorganization, whereby the Predecessor became a wholly owned subsidiary of the Company in a transaction intended to qualify as a reorganization under section 368(a)(1)(F) of the Code, the Predecessor was known as Kimco Realty Corporation and the Company was known as New KRC Corp. In connection with the Reorganization, the Predecessor became a “qualified REIT subsidiary” of the Company and the Company changed its name to Kimco Realty Corporation. The Predecessor

then converted into a Delaware limited liability company and changed its name to Kimco Realty OP, LLC. Prior to the Reorganization, the Predecessor elected to be taxed as a real estate investment trust (a “REIT”) and was organized and operated in a manner intended to qualify as a REIT. As a result of the Reorganization, the Company is treated as a continuation of the Predecessor for U.S. federal income tax purposes. Accordingly, references in this summary to “us,” “we,” or “our” include the Predecessor in its capacity as a REIT prior to the Reorganization, to the extent the context contemplates periods prior to the Reorganization.

We have elected to be taxed as a REIT under Sections 856 through 860 of the Code commencing with our taxable year ended December 31, 1992. We believe that we have been organized and have operated in a manner that has allowed us to qualify for taxation as a REIT under the Code commencing with such taxable year, and we intend to continue to be organized and operate in this manner. However, qualification and taxation as a REIT depend upon our ability to meet the various qualification tests imposed under the Code, including through actual operating results, asset composition, distribution levels and diversity of stock ownership. Accordingly, no assurance can be given that we have been organized and have operated, or will continue to be organized and operate, in a manner so as to qualify or remain qualified as a REIT. See “—Failure to Qualify” for potential tax consequences if we fail to qualify as a REIT.

Latham & Watkins LLP has acted as our tax counsel in connection with the Prospectus and our election to be taxed as a REIT. Latham & Watkins LLP has rendered an opinion to us, as of the date of the Prospectus, to the effect that, (i) the Predecessor was organized and operated in conformity with the requirements for qualification and taxation as a REIT under the Code for its taxable years ended December 31, 1992 through its taxable year ended December 31, 2022 and (ii) commencing with our taxable year ending December 31, 2023, we have been organized and have operated in conformity with the requirements for qualification and taxation as a REIT under the Code, and our proposed method of operation will enable us to continue to meet the requirements for qualification and taxation as a REIT under the Code. It must be emphasized that this opinion was based on various assumptions and representations as to factual matters, including representations made by us in a factual certificate provided by one or more of our officers. In addition, this opinion was based upon our factual representations set forth in the Prospectus. Moreover, our qualification and taxation as a REIT depend upon our ability to meet the various qualification tests imposed under the Code, which are discussed below, including through actual operating results, asset composition, distribution levels and diversity of stock ownership, the results of which have not been and will not be reviewed by Latham & Watkins LLP. Accordingly, no assurance can be given that our actual results of operations for any particular taxable year have satisfied or will satisfy those requirements. Further, the anticipated U.S. federal income tax treatment described herein may be changed, perhaps retroactively, by legislative, administrative or judicial action at any time. Latham & Watkins LLP has no obligation to update its opinion subsequent to the date of such opinion.

Provided we qualify for taxation as a REIT, we generally will not be required to pay U.S. federal corporate income taxes on our REIT taxable income that is currently distributed to our stockholders. This treatment substantially eliminates the “double taxation” that ordinarily results from investment in a C corporation. A C corporation is a corporation that generally is required to pay tax at the corporate level. Double taxation means taxation once at the corporate level when income is earned and once again at the stockholder level when the income is distributed. We will, however, be required to pay U.S. federal income tax as follows:

  • First, we will be required to pay regular U.S. federal corporate income tax on any undistributed REIT taxable income, including undistributed capital gain.

  • Second, if we have (1) net income from the sale or other disposition of “foreclosure property” held primarily for sale to customers in the ordinary course of business or (2) other nonqualifying income from foreclosure property, we will be required to pay regular U.S. federal corporate income tax on this income. To the extent that income from foreclosure property is otherwise qualifying income for purposes of the 75% gross income test, this tax is not applicable. Subject to certain other requirements, foreclosure property generally is defined as property we acquired through foreclosure or after a default on a loan secured by the property or a lease of the property. See “—Foreclosure Property.”

  • Third, we will be required to pay a 100% tax on any net income from prohibited transactions. Prohibited transactions are, in general, sales or other taxable dispositions of property, other than foreclosure property, held as inventory or primarily for sale to customers in the ordinary course of business.

  • Fourth, if we fail to satisfy the 75% gross income test or the 95% gross income test, as described below, but have otherwise maintained our qualification as a REIT because certain other requirements are met, we will be required to pay a tax equal to (1) the greater of (A) the amount by which we fail to satisfy the 75% gross income test and (B) the amount by which we fail to satisfy the 95% gross income test, multiplied by (2) a fraction intended to reflect our profitability.

  • Fifth, if we fail to satisfy any of the asset tests (other than a de minimis failure of the 5% or 10% asset test), as described below, due to reasonable cause and not due to willful neglect, and we nonetheless maintain our REIT qualification because of specified cure provisions, we will be required to pay a tax equal to the greater of $50,000 or the U.S. federal corporate income tax rate multiplied by the net income generated by the nonqualifying assets that caused us to fail such test.

  • Sixth, if we fail to satisfy any provision of the Code that would result in our failure to qualify as a REIT (other than a violation of the gross income tests or certain violations of the asset tests, as described below) and the violation is due to reasonable cause and not due to willful neglect, we may retain our REIT qualification but we will be required to pay a penalty of $50,000 for each such failure.

  • Seventh, we will be required to pay a 4% excise tax to the extent we fail to distribute during each calendar year at least the sum of (1) 85% of our ordinary income for the year, (2) 95% of our capital gain net income for the year, and (3) any undistributed taxable income from prior periods.

  • Eighth, if we acquire any asset from a corporation that is or has been a C corporation in a transaction in which our tax basis in the asset is less than the fair market value of the asset, in each case determined as of the date on which we acquired the asset, and we subsequently recognize gain on the disposition of the asset during the five-year period beginning on the date on which we acquired the asset, then we generally will be required to pay regular U.S. federal corporate income tax on this gain to the extent of the excess of (1) the fair market value of the asset over (2) our adjusted tax basis in the asset, in each case determined as of the date on which we acquired the asset. The results described in this paragraph with respect to the recognition of gain assume that the C corporation will refrain from making an election to receive different treatment under applicable Treasury Regulations on its tax return for the year in which we acquire the asset from the C corporation. Under applicable Treasury Regulations, any gain from the sale of property we acquired in an exchange under Section 1031 (a like-kind exchange) or Section 1033 (an involuntary conversion) of the Code generally is excluded from the application of this built-in gains tax.

  • Ninth, our subsidiaries that are C corporations and are not qualified REIT subsidiaries, including our “taxable REIT subsidiaries” described below, generally will be required to pay regular U.S. federal corporate income tax on their earnings.

  • Tenth, we will be required to pay a 100% tax on any “redetermined rents,” “redetermined deductions,” “excess interest” or “redetermined TRS service income,” as described below under “—Penalty Tax.” In general, redetermined rents are rents from real property that are overstated as a result of services furnished to any of our tenants by a taxable REIT subsidiary of ours. Redetermined deductions and excess interest generally represent amounts that are deducted by a taxable REIT subsidiary of ours for amounts paid to us that are in excess of the amounts that would have been deducted based on arm’s length negotiations. Redetermined TRS service income generally represents income of a taxable REIT subsidiary that is understated as a result of services provided to us or on our behalf.

  • Eleventh, we may elect to retain and pay income tax on our net capital gain. In that case, a stockholder would include its proportionate share of our undistributed capital gain (to the extent we make a timely designation of such gain to the stockholder) in its income, would be deemed to have paid the tax that we paid on such gain, and would be allowed a credit for its proportionate share of the tax deemed to have been paid, and an adjustment would be made to increase the tax basis of the stockholder in our capital stock.

  • Twelfth, if we fail to comply with the requirement to send annual letters to our stockholders holding at least a certain percentage of our stock, as determined under applicable Treasury Regulations, requesting information regarding the actual ownership of our stock, and the failure is not due to reasonable cause or due to willful neglect, we will be subject to a $25,000 penalty, or if the failure is intentional, a $50,000 penalty.

We and our subsidiaries may be subject to a variety of taxes other than U.S. federal income tax, including payroll taxes and state and local income, property and other taxes on our assets and operations.

From time to time, we may own properties in other countries, which may impose taxes on our operations within their jurisdictions. To the extent possible, we will structure our activities to minimize our non-U.S. tax liability. However, there can be no assurance that we will be able to eliminate our non-U.S. tax liability or reduce it to a specified level. Furthermore, as a REIT, both we and our stockholders will derive little or no benefit from foreign tax credits arising from those non-U.S. taxes.

Requirements for Qualification as a REIT. The Code defines a REIT as a corporation, trust or association:

  • that is managed by one or more trustees or directors;

  • that issues transferable shares or transferable certificates to evidence its beneficial ownership;

  • that would be taxable as a domestic corporation, but for Sections 856 through 860 of the Code;

  • that is not a financial institution or an insurance company within the meaning of certain provisions of the Code;

  • that is beneficially owned by 100 or more persons;

  • not more than 50% in value of the outstanding stock of which is owned, actually or constructively, by five or fewer individuals, including certain specified entities, during the last half of each taxable year; and

  • that meets other tests, described below, regarding the nature of its income and assets and the amount of its distributions.

The Code provides that conditions (1) to (4), inclusive, must be met during the entire taxable year and that condition (5) must be met during at least 335 days of a taxable year of 12 months, or during a proportionate part of a taxable year of less than 12 months. Conditions (5) and (6) do not apply until after the first taxable year for which an election is made to be taxed as a REIT. For purposes of condition (6), the term “individual” includes a supplemental unemployment compensation benefit plan, a private foundation or a portion of a trust permanently set aside or used exclusively for charitable purposes, but generally does not include a qualified pension plan or profit sharing trust.

We believe that we have been organized and have operated in a manner that has allowed us, and will continue to allow us, to satisfy conditions (1) through (7), inclusive, during the relevant time periods. In addition, our charter provides for restrictions regarding ownership and transfer of our shares that are intended to assist us in continuing to satisfy the share ownership requirements described in conditions (5) and (6) above. A description of the share ownership and transfer restrictions relating to our capital stock is contained in the discussion in the Prospectus under the heading “Description of Common Stock—Restrictions on Ownership” and “Description of Preferred Stock—Restrictions on Ownership.” These restrictions, however, do not ensure that we have previously satisfied, and may not ensure that we will, in all cases, be able to continue to satisfy, the share ownership requirements described in conditions (5) and (6) above. If we fail to satisfy these share ownership requirements, then except as provided in the next sentence, our status as a REIT will terminate. If, however, we comply with the rules contained in applicable Treasury Regulations that require us to ascertain the actual ownership of our shares and we do not know, or would not have known through the exercise of reasonable diligence, that we failed to meet the requirement described in condition (6) above, we will be treated as having met this requirement. See “—Failure to Qualify.”

In addition, we may not maintain our status as a REIT unless our taxable year is the calendar year. We have and will continue to have a calendar taxable year.

Ownership of Interests in Partnerships, Limited Liability Companies and Qualified REIT Subsidiaries. In the case of a REIT that is a partner in a partnership (for purposes of this discussion, references to “partnership” include a limited liability company treated as a partnership for U.S. federal income tax purposes, and references to “partner” include a member in such limited liability company), Treasury Regulations provide that the REIT will be deemed to own its proportionate share of the assets of the partnership, based on its interest in partnership capital, subject to special rules relating to the 10% asset test described below. Also, the REIT will be deemed to be entitled to its proportionate share of the income of that entity. The assets and gross income of the partnership retain the same character in the hands of the REIT for purposes of Section 856 of the Code, including satisfying the gross income tests and the asset tests. Thus, our pro rata share of the assets and items of income of Kimco OP, including Kimco OP’s share of these items of any partnership or disregarded entity for U.S. federal income tax purposes in which it owns an interest, is treated as our assets and items of income for purposes of applying the requirements described in this discussion, including the gross income and asset tests described below. A brief summary of the rules governing the U.S. federal income taxation of partnerships is set forth below in “—Tax Aspects of Kimco OP and the Subsidiary Partnerships and Limited Liability Companies.”

We have control of Kimco OP and most of the subsidiary partnerships and intend to operate them in a manner consistent with the requirements for our qualification as a REIT. If a partnership we do not control takes or expects to take actions that could jeopardize our status as a REIT or require us to pay tax, we may be forced to dispose of our interest in such entity. In addition, it is possible that a partnership could take an action which could cause us to fail a gross income or asset test, and that we would not become aware of such action in time to dispose of our interest in the partnership or take other corrective action on a timely basis. In such a case, we could fail to qualify as a REIT unless we were entitled to relief, as described below.

We may from time to time own and operate certain properties through wholly-owned subsidiaries that we intend to be treated as “qualified REIT subsidiaries” under the Code. A corporation (or other entity treated as a corporation for U.S. federal income tax purposes) will qualify as our qualified REIT subsidiary if we own 100% of the corporation’s outstanding stock and do not elect with the subsidiary to treat it as a “taxable REIT subsidiary,” as described below. A qualified REIT subsidiary is not treated as a separate corporation, and all assets, liabilities and items of income, gain, loss, deduction and credit of a qualified REIT subsidiary

are treated as assets, liabilities and items of income, gain, loss, deduction and credit of the parent REIT for all purposes under the Code, including all REIT qualification tests. Thus, in applying the U.S. federal income tax requirements described in this discussion, any qualified REIT subsidiaries we own are ignored, and all assets, liabilities and items of income, gain, loss, deduction and credit of such corporations are treated as our assets, liabilities and items of income, gain, loss, deduction and credit. A qualified REIT subsidiary is not subject to U.S. federal income tax, and our ownership of the stock of a qualified REIT subsidiary will not violate the restrictions on ownership of securities, as described below under “—Asset Tests.”

Ownership of Interests in Taxable REIT Subsidiaries. We and Kimco OP own interests in companies that have elected, together with us, to be treated as our taxable REIT subsidiaries, and we may acquire securities in additional taxable REIT subsidiaries in the future. A taxable REIT subsidiary is a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) other than a REIT in which a REIT directly or indirectly holds stock, and that has made a joint election with such REIT to be treated as a taxable REIT subsidiary. If a taxable REIT subsidiary owns more than 35% of the total voting power or value of the outstanding securities of another corporation, such other corporation will also be treated as a taxable REIT subsidiary. Other than some activities relating to lodging and health care facilities, a taxable REIT subsidiary may generally engage in any business, including the provision of customary or non-customary services to tenants of its parent REIT. A taxable REIT subsidiary is subject to U.S. federal income tax as a regular C corporation. A REIT is not treated as holding the assets of a taxable REIT subsidiary or as receiving any income that the taxable REIT subsidiary earns. Rather, the stock issued by the taxable REIT subsidiary is an asset in the hands of the REIT, and the REIT generally recognizes as income the dividends, if any, that it receives from the taxable REIT subsidiary. A REIT’s ownership of securities of a taxable REIT subsidiary is not subject to the 5% or 10% asset test described below. See “—Asset Tests.” Taxpayers are subject to a limitation on their ability to deduct net business interest generally equal to 30% of adjusted taxable income, subject to certain exceptions. See “—Annual Distribution Requirements.” While not certain, this provision may limit the ability of our taxable REIT subsidiaries to deduct interest, which could increase their taxable income.

Ownership of Interests in Subsidiary REITs. We own and may acquire direct or indirect interests in one or more entities that have elected or will elect to be taxed as REITs under the Code (each, a “Subsidiary REIT”). A Subsidiary REIT is subject to the various REIT qualification requirements and other limitations described herein that are applicable to us. If a Subsidiary REIT were to fail to qualify as a REIT, then (i) that Subsidiary REIT would become subject to U.S. federal income tax and (ii) the Subsidiary REIT’s failure to qualify could have an adverse effect on our ability to comply with the REIT income and asset tests, and thus could impair our ability to qualify as a REIT unless we could avail ourselves of certain relief provisions.

Income Tests. We must satisfy two gross income requirements annually to maintain our qualification as a REIT. First, in each taxable year we must derive directly or indirectly at least 75% of our gross income (excluding gross income from prohibited transactions, certain hedging transactions and certain foreign currency gains) from investments relating to real property or mortgages on real property, including “rents from real property,” dividends from other REITs and, in certain circumstances, interest, or certain types of temporary investments. Second, in each taxable year we must derive at least 95% of our gross income (excluding gross income from prohibited transactions, certain hedging transactions, and certain foreign currency gains) from the real property investments described above or dividends, interest and gain from the sale or disposition of stock or securities, or from any combination of the foregoing. For these purposes, the term “interest” generally does not include any amount received or accrued, directly or indirectly, if the determination of all or some of the amount depends in any way on the income or profits of any person. However, an amount received or accrued generally will not be excluded from the term “interest” solely by reason of being based on a fixed percentage or percentages of receipts or sales.

Rents we receive from a tenant will qualify as “rents from real property” for the purpose of satisfying the gross income requirements for a REIT described above only if all of the following conditions are met:

  • The amount of rent is not based in whole or in part on the income or profits of any person. However, an amount we receive or accrue generally will not be excluded from the term “rents from real property” solely because it is based on a fixed percentage or percentages of receipts or sales or if it is based on the net income of a tenant which derives substantially all of its income with respect to such property from subleasing of substantially all of such property, to the extent that the rents paid by the subtenants would qualify as rents from real property if we earned such amounts directly;

  • Neither we nor an actual or constructive owner of 10% or more of our capital stock actually or constructively owns 10% or more of the interests in the assets or net profits of a non-corporate tenant, or, if the tenant is a corporation, 10% or more of the total combined voting power of all classes of stock entitled to vote or 10% or more of the total value of all classes of stock of the tenant. Rents we receive from such a tenant that is a taxable REIT subsidiary of ours, however, will not be excluded from the definition of “rents from real property” as a result of this condition if at least 90% of the

  • space at the property to which the rents relate is leased to third parties, and the rents paid by the taxable REIT subsidiary are substantially comparable to rents paid by our other tenants for comparable space. Whether rents paid by a taxable REIT subsidiary are substantially comparable to rents paid by other tenants is determined at the time the lease with the taxable REIT subsidiary is entered into, extended, and modified, if such modification increases the rents due under such lease. Notwithstanding the foregoing, however, if a lease with a “controlled taxable REIT subsidiary” is modified and such modification results in an increase in the rents payable by such taxable REIT subsidiary, any such increase will not qualify as “rents from real property.” For purposes of this rule, a “controlled taxable REIT subsidiary” is a taxable REIT subsidiary in which the parent REIT owns stock possessing more than 50% of the voting power or more than 50% of the total value of the outstanding stock of such taxable REIT subsidiary;

  • Rent attributable to personal property, leased in connection with a lease of real property, is not greater than 15% of the total rent received under the lease. If this condition is not met, then the portion of the rent attributable to personal property will not qualify as “rents from real property.” To the extent that rent attributable to personal property, leased in connection with a lease of real property, exceeds 15% of the total rent received under the lease, we may transfer a portion of such personal property to a taxable REIT subsidiary; and

  • We generally may not operate or manage the property or furnish or render services to our tenants, subject to a 1% de minimis exception and except as provided below. We may, however, perform services that are “usually or customarily rendered” in connection with the rental of space for occupancy only and are not otherwise considered “rendered to the occupant” of the property. Examples of these services include the provision of light, heat, or other utilities, trash removal and general maintenance of common areas. In addition, we may employ an independent contractor from whom we derive no revenue to provide customary services to our tenants, or a taxable REIT subsidiary (which may be wholly or partially owned by us) to provide both customary and non-customary services to our tenants without causing the rent we receive from those tenants to fail to qualify as “rents from real property.”

We generally do not intend, and, as the managing member of Kimco OP, we do not intend to permit Kimco OP, to take actions we believe will cause us to fail to satisfy the rental conditions described above. However, we may intentionally fail to satisfy some of these conditions to the extent we determine, based on the advice of our tax counsel, that the failure will not jeopardize our tax status as a REIT. In addition, with respect to the limitation on the rental of personal property, we generally have not obtained appraisals of the real property and personal property leased to tenants. Accordingly, there can be no assurance that the IRS will not disagree with our determinations of value.

From time to time, we may enter into hedging transactions with respect to one or more of our assets or liabilities. Our hedging activities may include entering into interest rate swaps, caps, and floors, options to purchase these items, and futures and forward contracts. Income from a hedging transaction, including gain from the sale or disposition of such a transaction, that is clearly identified as a hedging transaction as specified in the Code will not constitute gross income under, and thus will be exempt from, the 75% and 95% gross income tests. The term “hedging transaction,” as used above, generally means (A) any transaction we enter into in the normal course of our business primarily to manage risk of (1) interest rate changes or fluctuations with respect to borrowings made or to be made by us to acquire or carry real estate assets, or (2) currency fluctuations with respect to an item of qualifying income under the 75% or 95% gross income test or any property which generates such income and (B) new transactions entered into to hedge the income or loss from prior hedging transactions, where any portion of the property or indebtedness which was the subject of the prior hedging transaction was extinguished or disposed of. To the extent that we do not properly identify such transactions as hedges or we hedge with other types of financial instruments, the income from those transactions is not likely to be treated as qualifying income for purposes of the gross income tests. We intend to structure any hedging transactions in a manner that does not jeopardize our status as a REIT.

We have investments in several entities located outside the United States and from time to time may invest in additional entities or properties located outside the United States, through a taxable REIT subsidiary or otherwise. These acquisitions could cause us to incur foreign currency gains or losses. Any foreign currency gains, to the extent attributable to specified items of qualifying income or gain, or specified qualifying assets, however, generally will not constitute gross income for purposes of the 75% and 95% gross income tests, and therefore will be excluded from these tests.

To the extent our taxable REIT subsidiaries pay dividends or interest, our allocable share of such dividend or interest income will qualify under the 95%, but (subject to certain exceptions) not the 75%, gross income test. Notwithstanding the foregoing, our allocable share of such interest would also qualify under the 75% gross income test to the extent the interest is paid on a loan that is adequately secured by real property.

We will monitor the amount of the dividend and other income from our taxable REIT subsidiaries and will take actions intended to keep this income, and any other nonqualifying income, within the limitations of the gross income tests. Although we expect these actions will be sufficient to prevent a violation of the gross income tests, we cannot guarantee that such actions will in all cases prevent such a violation.

If we fail to satisfy one or both of the 75% or 95% gross income tests for any taxable year, we may nevertheless qualify as a REIT for the year if we are entitled to relief under certain provisions of the Code. We generally may make use of the relief provisions if:

  • following our identification of the failure to meet the 75% or 95% gross income tests for any taxable year, we file a schedule with the IRS setting forth each item of our gross income for purposes of the 75% or 95% gross income tests for such taxable year in accordance with Treasury Regulations to be issued; and
  • our failure to meet these tests was due to reasonable cause and not due to willful neglect.

It is not possible, however, to state whether in all circumstances we would be entitled to the benefit of these relief provisions. For example, if we fail to satisfy the gross income tests because nonqualifying income that we intentionally accrue or receive exceeds the limits on nonqualifying income, the IRS could conclude that our failure to satisfy the tests was not due to reasonable cause. If these relief provisions do not apply to a particular set of circumstances, we will not qualify as a REIT. See “—Failure to Qualify” below. As discussed above in “—General,” even if these relief provisions apply, and we retain our status as a REIT, a tax would be imposed with respect to our nonqualifying income. We may not always be able to comply with the gross income tests for REIT qualification despite periodic monitoring of our income.

Prohibited Transaction Income. Any gain that we realize on the sale of property (other than any foreclosure property) held as inventory or otherwise held primarily for sale to customers in the ordinary course of business, including our share of any such gain realized by Kimco OP, either directly or through its subsidiary partnerships, will be treated as income from a prohibited transaction that is subject to a 100% penalty tax, unless certain safe harbor exceptions apply. This prohibited transaction income may also adversely affect our ability to satisfy the gross income tests for qualification as a REIT. Under existing law, whether property is held as inventory or primarily for sale to customers in the ordinary course of a trade or business is a question of fact that depends on all the facts and circumstances surrounding the particular transaction. As the managing member of Kimco OP, we intend to cause Kimco OP to hold its properties for investment with a view to long-term appreciation, to engage in the business of acquiring, developing and owning its properties and to make occasional sales of the properties as are consistent with our investment objectives. We do not intend, and do not intend to permit Kimco OP or its subsidiary partnerships, to enter into any sales that are prohibited transactions. However, the IRS may successfully contend that some or all of the sales made by Kimco OP or its subsidiary partnerships are prohibited transactions. We would be required to pay the 100% penalty tax on our allocable share of the gains resulting from any such sales. The 100% penalty tax will not apply to gains from the sale of assets that are held through a taxable REIT subsidiary, but such income will be subject to regular U.S. federal corporate income tax.

Penalty Tax. Any redetermined rents, redetermined deductions, excess interest or redetermined TRS service income we generate will be subject to a 100% penalty tax. In general, redetermined rents are rents from real property that are overstated as a result of any services furnished to any of our tenants by a taxable REIT subsidiary of ours, redetermined deductions and excess interest represent any amounts that are deducted by a taxable REIT subsidiary of ours for amounts paid to us that are in excess of the amounts that would have been deducted based on arm’s length negotiations, and redetermined TRS service income is income of a taxable REIT subsidiary that is understated as a result of services provided to us or on our behalf. Rents we receive will not constitute redetermined rents if they qualify for certain safe harbor provisions contained in the Code.

We do not believe we have been, and do not expect to be, subject to this penalty tax, although any rental or service arrangements we enter into from time to time may not satisfy the safe-harbor provisions referenced above. These determinations are inherently factual, and the IRS has broad discretion to assert that amounts paid between related parties should be reallocated to clearly reflect their respective incomes. If the IRS successfully made such an assertion, we would be required to pay a 100% penalty tax on any overstated rents paid to us, or any excess deductions or understated income of our taxable REIT subsidiaries.

Asset Tests. At the close of each calendar quarter of our taxable year, we must also satisfy certain tests relating to the nature and diversification of our assets. First, at least 75% of the value of our total assets must be represented by real estate assets, cash, cash items and U.S. government securities. For purposes of this test, the term “real estate assets” generally means real property

(including interests in real property and interests in mortgages on real property or on both real property and, to a limited extent, personal property), shares (or transferable certificates of beneficial interest) in other REITs, any stock or debt instrument attributable to the investment of the proceeds of a stock offering or a public offering of debt with a term of at least five years (but only for the one-year period beginning on the date the REIT receives such proceeds), debt instruments of publicly offered REITs, and personal property leased in connection with a lease of real property for which the rent attributable to personal property is not greater than 15% of the total rent received under the lease.

Second, not more than 25% of the value of our total assets may be represented by securities (including securities of taxable REIT subsidiaries), other than those securities includable in the 75% asset test.

Third, of the investments included in the 25% asset class, and except for certain investments in other REITs, our qualified REIT subsidiaries and taxable REIT subsidiaries, the value of any one issuer’s securities may not exceed 5% of the value of our total assets, and we may not own more than 10% of the total vote or value of the outstanding securities of any one issuer. Certain types of securities we may own are disregarded as securities solely for purposes of the 10% value test, including, but not limited to, securities satisfying the “straight debt” safe harbor, securities issued by a partnership that itself would satisfy the 75% income test if it were a REIT, any loan to an individual or an estate, any obligation to pay rents from real property and any security issued by a REIT. In addition, solely for purposes of the 10% value test, the determination of our interest in the assets of a partnership in which we own an interest will be based on our proportionate interest in any securities issued by the partnership, excluding for this purpose certain securities described in the Code. From time to time we may own securities (including debt securities) of issuers that do not qualify as a REIT, a qualified REIT subsidiary or a taxable REIT subsidiary. We intend that our ownership of any such securities will be structured in a manner that allows us to comply with the asset tests described above.

Fourth, not more than 20% (25% for taxable years beginning after July 30, 2008 and before January 1, 2018 and taxable years beginning after December 31, 2025) of the value of our total assets may be represented by the securities of one or more taxable REIT subsidiaries. We and Kimco OP own interests in companies that have elected, together with us, to be treated as our taxable REIT subsidiaries, and we may acquire securities in additional taxable REIT subsidiaries in the future. So long as each of these companies qualifies as a taxable REIT subsidiary of ours, we will not be subject to the 5% asset test, the 10% voting power limitation or the 10% value limitation with respect to our ownership of the securities of such companies. We believe that the aggregate value of our taxable REIT subsidiaries has not exceeded, and in the future will not exceed, 20% (25% for taxable years beginning after July 30, 2008 and before January 1, 2018 and taxable years beginning after December 31, 2025) of the aggregate value of our gross assets. We generally do not obtain independent appraisals to support these conclusions. In addition, there can be no assurance that the IRS will not disagree with our determinations of value.

Fifth, not more than 25% of the value of our total assets may be represented by debt instruments of publicly offered REITs to the extent those debt instruments would not be real estate assets but for the inclusion of debt instruments of publicly offered REITs in the meaning of real estate assets, as described above (e.g., a debt instrument issued by a publicly offered REIT that is not secured by a mortgage on real property).

The asset tests must be satisfied at the close of each calendar quarter of our taxable year in which we (directly or through any partnership or qualified REIT subsidiary) acquire securities in the applicable issuer, and also at the close of each calendar quarter in which we increase our ownership of securities of such issuer (including as a result of an increase in our interest in any partnership that owns such securities). For example, our indirect ownership of securities of each issuer will increase as a result of our capital contributions to Kimco OP or as limited partners exercise any redemption rights. Also, after initially meeting the asset tests at the close of any quarter, we will not lose our status as a REIT for failure to satisfy the asset tests at the end of a later quarter solely by reason of changes in asset values. If we fail to satisfy an asset test because we acquire securities or other property during a quarter (including as a result of an increase in our interest in any partnership), we may cure this failure by disposing of sufficient nonqualifying assets within 30 days after the close of that quarter. We believe that we have maintained, and we intend to maintain, adequate records of the value of our assets to ensure compliance with the asset tests. If we fail to cure any noncompliance with the asset tests within the 30-day cure period, we would cease to qualify as a REIT unless we are eligible for certain relief provisions discussed below.

Certain relief provisions may be available to us if we discover a failure to satisfy the asset tests described above after the 30-day cure period. Under these provisions, we will be deemed to have met the 5% and 10% asset tests if the value of our nonqualifying assets (i) does not exceed the lesser of (a) 1% of the total value of our assets at the end of the applicable quarter or (b) $10,000,000, and (ii) we dispose of the nonqualifying assets or otherwise satisfy such tests within (a) six months after the last day of the quarter in which the failure to satisfy the asset tests is discovered or (b) the period of time prescribed by Treasury Regulations

to be issued. For violations of any of the asset tests due to reasonable cause and not due to willful neglect and that are, in the case of the 5% and 10% asset tests, in excess of the de minimis exception described above, we may avoid disqualification as a REIT after the 30-day cure period by taking steps including (i) the disposition of sufficient nonqualifying assets, or the taking of other actions, which allow us to meet the asset tests within (a) six months after the last day of the quarter in which the failure to satisfy the asset tests is discovered or (b) the period of time prescribed by Treasury Regulations to be issued, (ii) paying a tax equal to the greater of (a) $50,000 or (b) the U.S. federal corporate income tax rate multiplied by the net income generated by the nonqualifying assets, and (iii) disclosing certain information to the IRS.

Although we believe we have satisfied the asset tests described above and plan to take steps to ensure that we satisfy such tests for any quarter with respect to which retesting is to occur, there can be no assurance that we will always be successful, or will not require a reduction in Kimco OP’s overall interest in an issuer (including in a taxable REIT subsidiary). If we fail to cure any noncompliance with the asset tests in a timely manner, and the relief provisions described above are not available, we would cease to qualify as a REIT.

Annual Distribution Requirements. To maintain our qualification as a REIT, we are required to distribute dividends, other than capital gain dividends, to our stockholders each year in an amount at least equal to the sum of:

  • 90% of our REIT taxable income; and
  • 90% of our after-tax net income, if any, from foreclosure property; minus
  • the excess of the sum of certain items of non-cash income over 5% of our REIT taxable income.

For these purposes, our REIT taxable income is computed without regard to the dividends paid deduction and our net capital gain. In addition, for purposes of this test, non-cash income generally means income attributable to leveled stepped rents, original issue discount, cancellation of indebtedness, or a like-kind exchange that is later determined to be taxable.

In addition, our REIT taxable income will be reduced by any taxes we are required to pay on any gain we recognize from the disposition of any asset we acquired from a corporation that is or has been a C corporation in a transaction in which our tax basis in the asset is less than the fair market value of the asset, in each case determined as of the date on which we acquired the asset, within the five-year period following our acquisition of such asset, as described above under “—General.”

Except as provided below, a taxpayer’s deduction for net business interest expense will generally be limited to 30% of its taxable income, as adjusted for certain items of income, gain, deduction or loss. Any business interest deduction that is disallowed due to this limitation may be carried forward to future taxable years, subject to special rules applicable to partnerships. If we or any of our subsidiary partnerships (including Kimco OP) are subject to this interest expense limitation, our REIT taxable income for a taxable year may be increased. Taxpayers that conduct certain real estate businesses may elect not to have this interest expense limitation apply to them, provided that they use an alternative depreciation system to depreciate certain property. We believe that we or any of our subsidiary partnerships that are subject to this interest expense limitation will be eligible to make this election. If such election is made, although we or such subsidiary partnership, as applicable, would not be subject to the interest expense limitation described above, depreciation deductions may be reduced and, as a result, our REIT taxable income for a taxable year may be increased.

We generally must pay, or be treated as paying, the distributions described above in the taxable year to which they relate. At our election, a distribution will be treated as paid in a taxable year if it is declared before we timely file our tax return for such year and paid on or before the first regular dividend payment after such declaration, provided such payment is made during the 12-month period following the close of such year. These distributions are treated as received by our stockholders in the year in which they are paid. This is so even though these distributions relate to the prior year for purposes of the 90% distribution requirement. In order to be taken into account for purposes of our distribution requirement, except as provided below, the amount distributed must not be preferential—i.e., every stockholder of the class of stock to which a distribution is made must be treated the same as every other stockholder of that class, and no class of stock may be treated other than according to its dividend rights as a class. This preferential dividend limitation will not apply to distributions made by us, provided we qualify as a “publicly offered REIT.” We believe that we are, and expect we will continue to be, a publicly offered REIT. However, Subsidiary REITs we may own from time to time may not be publicly offered REITs. To the extent that we do not distribute all of our net capital gain, or distribute at least 90%, but less than 100%, of our REIT taxable income, as adjusted, we will be required to pay regular U.S. federal corporate income tax on the undistributed amount. We believe that we have made, and we intend to continue to make, timely distributions sufficient to satisfy these annual distribution requirements and to minimize our corporate tax obligations. In this regard, the limited liability agreement of Kimco OP authorizes us, as the managing member of Kimco OP, to take such steps as may be necessary to cause

Kimco OP to distribute to its members an amount sufficient to permit us to meet these distribution requirements and to minimize our corporate tax obligation.

We expect that our REIT taxable income will be less than our cash flow because of depreciation and other non-cash charges included in computing REIT taxable income. Accordingly, we anticipate that we generally will have sufficient cash or liquid assets to enable us to satisfy the distribution requirements described above. However, from time to time, we may not have sufficient cash or other liquid assets to meet these distribution requirements due to timing differences between the actual receipt of income and actual payment of deductible expenses, and the inclusion of income and deduction of expenses in determining our taxable income. In addition, we may decide to retain our cash, rather than distribute it, in order to repay debt or for other reasons. If these timing differences occur, we may borrow funds to pay dividends or pay dividends in the form of taxable stock distributions in order to meet the distribution requirements, while preserving our cash.

Under some circumstances, we may be able to rectify an inadvertent failure to meet the 90% distribution requirement for a year by paying “deficiency dividends” to our stockholders in a later year, which may be included in our deduction for dividends paid for the earlier year. In that case, we may be able to avoid being taxed on amounts distributed as deficiency dividends, subject to the 4% excise tax described below. However, we will be required to pay interest to the IRS based upon the amount of any deduction claimed for deficiency dividends. While the payment of a deficiency dividend will apply to a prior year for purposes of our REIT distribution requirements, it will be treated as an additional distribution to our stockholders in the year such dividend is paid. In addition, if a dividend paid by a REIT (including any of our Subsidiary REITs) is treated as a preferential dividend, in lieu of treating the dividend as not counting toward satisfying the 90% distribution requirement, the IRS may provide a remedy to cure such failure if the IRS determines that such failure is (or is of a type that is) inadvertent or due to reasonable cause and not due to willful neglect.

Furthermore, we will be required to pay a 4% excise tax to the extent we fail to distribute during each calendar year at least the sum of 85% of our ordinary income for such year, 95% of our capital gain net income for the year and any undistributed taxable income from prior periods. Any ordinary income and net capital gain on which U.S. federal corporate income tax is imposed for any year is treated as an amount distributed during that year for purposes of calculating this excise tax.

For purposes of the 90% distribution requirement and excise tax described above, dividends declared during the last three months of the taxable year, payable to stockholders of record on a specified date during such period and paid during January of the following year, will be treated as paid by us and received by our stockholders on December 31 of the year in which they are declared.

Like-Kind Exchanges. We may dispose of real property that is not held primarily for sale in transactions intended to qualify as like-kind exchanges under the Code. Such like-kind exchanges are intended to result in the deferral of gain for U.S. federal income tax purposes. The failure of any such transaction to qualify as a like-kind exchange could require us to pay U.S. federal income tax, possibly including the 100% prohibited transaction tax, or deficiency dividends, depending on the facts and circumstances surrounding the particular transaction.

Tax Liabilities and Attributes Inherited in Connection with Acquisitions. From time to time, we or Kimco OP may acquire other corporations or entities and, in connection with such acquisitions, we may succeed to the historical tax attributes and liabilities of such entities. For example, if we acquire a C corporation and subsequently dispose of its assets within five years of the acquisition, we could be required to pay the built-in gain tax described above under “—General.” In addition, in order to qualify as a REIT, at the end of any taxable year, we must not have any earnings and profits accumulated in a non-REIT year. As a result, if we acquire a C corporation, we must distribute the corporation’s earnings and profits accumulated prior to the acquisition before the end of the taxable year in which we acquire the corporation. We also could be required to pay the acquired entity’s unpaid taxes even though such liabilities arose prior to the time we acquired the entity.

Moreover, we or one of our subsidiaries may from time to time acquire other REITs through a merger or acquisition. If any such REIT failed to qualify as a REIT for any of its taxable years, such REIT would be liable for (and we or our subsidiary, as applicable, as the surviving corporation in the merger or acquisition, would be obligated to pay) regular U.S. federal corporate income tax on its taxable income for such taxable years. In addition, if such REIT was a C corporation at the time of the merger or acquisition, the tax consequences described in the preceding paragraph generally would apply. If such REIT failed to qualify as a REIT for any of its taxable years, but qualified as a REIT at the time of such merger or acquisition, and we acquired such REIT’s assets in a transaction in which our tax basis in the assets of such REIT is determined, in whole or in part, by reference to such REIT’s tax basis in such assets, we generally would be subject to tax on the built-in gain on each asset of such REIT as described above if we were to dispose of the asset in a taxable transaction during the five-year period following such REIT’s requalification as a REIT, subject to certain exceptions. Moreover, even if such REIT qualified as a REIT at all relevant times, we would similarly

be liable for other unpaid taxes (if any) of such REIT (such as the 100% tax on gains from any sales treated as “prohibited transactions” as described above under “—Prohibited Transaction Income”).

Furthermore, after our acquisition of another corporation or entity, the asset and income tests will apply to all of our assets, including the assets we acquire from such corporation or entity, and to all of our income, including the income derived from the assets we acquire from such corporation or entity. As a result, the nature of the assets that we acquire from such corporation or entity and the income we derive from those assets may have an effect on our tax status as a REIT.

Foreclosure Property. The foreclosure property rules permit us (by our election) to foreclose or repossess properties without being disqualified as a REIT as a result of receiving income that does not qualify under the gross income tests. However, in such a case, we would be subject to the U.S. federal corporate income tax on the net non-qualifying income from “foreclosure property,” and the after-tax amount would increase the dividends we would be required to distribute to stockholders. See “—Annual Distribution Requirements.” This corporate tax would not apply to income that qualifies under the REIT 75% income test.

Foreclosure property treatment is generally available for an initial period of three years and may, in certain circumstances, be extended for an additional three years. However, foreclosure property treatment will end on the first day on which we enter into a lease of the applicable property that will give rise to income that does not qualify under the REIT 75% income test, but will not end if the lease will give rise only to qualifying income under such test. Foreclosure property treatment also will end if any construction takes place on the property (other than completion of a building or other improvement that was more than 10% complete before default became imminent).

Failure to Qualify. If we discover a violation of a provision of the Code that would result in our failure to qualify as a REIT, certain specified cure provisions may be available to us. Except with respect to violations of the gross income tests and asset tests (for which the cure provisions are described above), and provided the violation is due to reasonable cause and not due to willful neglect, these cure provisions generally impose a $50,000 penalty for each violation in lieu of a loss of REIT status. If we fail to satisfy the requirements for taxation as a REIT in any taxable year, and the relief provisions do not apply, we will be required to pay regular U.S. federal corporate income tax, including any applicable alternative minimum tax, on our taxable income. Distributions to stockholders in any year in which we fail to qualify as a REIT will not be deductible by us. As a result, we anticipate that our failure to qualify as a REIT would reduce the cash available for distribution by us to our stockholders. In addition, if we fail to qualify as a REIT, we will not be required to distribute any amounts to our stockholders and all distributions to stockholders will be taxable as regular corporate dividends to the extent of our current and accumulated earnings and profits. In such event, corporate stockholders may be eligible for the dividends-received deduction. In addition, non-corporate stockholders, including individuals, may be eligible for the preferential tax rates on qualified dividend income. Non-corporate stockholders, including individuals, generally may deduct up to 20% of dividends from a REIT, other than capital gain dividends and dividends treated as qualified dividend income, for purposes of determining their U.S. federal income tax (but not for purposes of the 3.8% Medicare tax), subject to certain holding period requirements and other limitations. If we fail to qualify as a REIT, such stockholders may not claim this deduction with respect to dividends paid by us. Unless entitled to relief under specific statutory provisions, we would also be ineligible to elect to be treated as a REIT for the four taxable years following the year for which we lose our qualification. It is not possible to state whether in all circumstances we would be entitled to this statutory relief.

Tax Aspects of Kimco OP and the Subsidiary Partnerships and Limited Liability Companies

General. All of our investments are held indirectly through Kimco OP. In addition, Kimco OP holds certain of its investments indirectly through subsidiary partnerships and limited liability companies that we believe are and will continue to be treated as partnerships or disregarded entities for U.S. federal income tax purposes. In general, entities that are treated as partnerships or disregarded entities for U.S. federal income tax purposes are “pass-through” entities which are not required to pay U.S. federal income tax. Rather, partners of such partnerships are allocated their shares of the items of income, gain, loss, deduction and credit of the partnership, and are potentially required to pay tax on this income, without regard to whether they receive a distribution from the partnership. We will include in our income our share of these partnership items for purposes of the various gross income tests, the computation of our REIT taxable income, and the REIT distribution requirements. Moreover, for purposes of the asset tests, we will include our pro rata share of assets held by Kimco OP, including its share of the assets of its subsidiary partnerships, based on our capital interests in each such entity. See “—Taxation of Our Company—Ownership of Interests in Partnerships, Limited Liability Companies and Qualified REIT Subsidiaries.” A disregarded entity is not treated as a separate entity for U.S. federal income tax purposes, and all assets, liabilities and items of income, gain, loss, deduction and credit of a disregarded entity are treated as assets, liabilities and items of income, gain, loss, deduction and credit of its parent that is not a disregarded entity for all purposes under the Code, including all REIT qualification tests.

Entity Classification. Our interests in Kimco OP and the subsidiary partnerships and limited liability companies involve special tax considerations, including the possibility that the IRS might challenge the status of these entities as partnerships or disregarded entities for U.S. federal income tax purposes. For example, an entity that would otherwise be treated as a partnership for U.S. federal income tax purposes may nonetheless be taxable as a corporation if it is a “publicly traded partnership” and certain other requirements are met. A partnership would be treated as a publicly traded partnership if its interests are traded on an established securities market or are readily tradable on a secondary market or a substantial equivalent thereof, within the meaning of applicable Treasury Regulations. We do not anticipate that Kimco OP or any subsidiary partnership will be treated as a publicly traded partnership that is taxable as a corporation. However, if any such entity were treated as a corporation, it would be required to pay an entity-level tax on its income. In this situation, the character of our assets and items of gross income would change and could prevent us from satisfying the REIT asset tests and possibly the REIT income tests. See “—Taxation of Our Company—Asset Tests” and “—Income Tests.” This, in turn, could prevent us from qualifying as a REIT. See “—Taxation of Our Company—Failure to Qualify” for a discussion of the effect of our failure to meet these tests. In addition, a change in the tax status of Kimco OP or a subsidiary treated as a partnership or disregarded entity to a corporation might be treated as a taxable event. If so, we might incur a tax liability without any related cash payment. We believe Kimco OP and each of the subsidiary partnerships and limited liability companies are and will continue to be treated as partnerships or disregarded entities for U.S. federal income tax purposes.

Allocations of Items of Income, Gain, Loss and Deduction. A partnership agreement (or, in the case of a limited liability company treated as a partnership for U.S. federal income tax purposes, the limited liability company agreement) generally will determine the allocation of income and loss among partners. These allocations, however, will be disregarded for tax purposes if they do not comply with the provisions of Section 704(b) of the Code and the Treasury Regulations thereunder. Generally, Section 704(b) of the Code and the Treasury Regulations thereunder require that partnership allocations respect the economic arrangement of the partners. If an allocation of partnership income or loss does not comply with the requirements of Section 704(b) of the Code and the Treasury Regulations thereunder, the item subject to the allocation will be reallocated in accordance with the partners’ interests in the partnership. This reallocation will be determined by taking into account all of the facts and circumstances relating to the economic arrangement of the partners with respect to such item. The allocations of taxable income and loss of Kimco OP and any subsidiaries that are treated as partnerships for U.S. federal income tax purposes are intended to comply with the requirements of Section 704(b) of the Code and the Treasury Regulations thereunder.

Tax Allocations With Respect to the Properties. Under Section 704(c) of the Code, items of income, gain, loss and deduction attributable to appreciated or depreciated property that is contributed to a partnership in exchange for an interest in the partnership must be allocated in a manner so that the contributing partner is charged with the unrealized gain or benefits from the unrealized loss associated with the property at the time of the contribution. The amount of the unrealized gain or unrealized loss generally is equal to the difference between the fair market value or book value and the adjusted tax basis of the contributed property at the time of contribution (this difference is referred to as a book-tax difference), as adjusted from time to time. These allocations are solely for U.S. federal income tax purposes and do not affect the book capital accounts or other economic or legal arrangements among the partners.

Kimco OP may, from time to time, acquire interests in property in exchange for interests in Kimco OP. In that case, the tax basis of these property interests generally will carry over to Kimco OP, notwithstanding their different book (i.e., fair market) value. The limited liability company agreement requires that income and loss allocations with respect to these properties be made in a manner consistent with Section 704(c) of the Code. Treasury Regulations issued under Section 704(c) of the Code provide partnerships with a choice of several methods of accounting for book-tax differences. Depending on the method we choose in connection with any particular contribution, the carryover basis of each of the contributed interests in the properties in the hands of Kimco OP (1) could cause us to be allocated lower amounts of depreciation deductions for tax purposes than would be allocated to us if any of the contributed properties were to have a tax basis equal to its respective fair market value at the time of the contribution and (2) could cause us to be allocated taxable gain in the event of a sale of such contributed interests or properties in excess of the economic or book income allocated to us as a result of such sale, with a corresponding benefit to the other members in Kimco OP. An allocation described in clause (2) above might cause us or the other members to recognize taxable income in excess of cash proceeds in the event of a sale or other disposition of property, which might adversely affect our ability to comply with the REIT distribution requirements. See “—Taxation of Our Company—Requirements for Qualification as a REIT” and “—Annual Distribution Requirements.”

Any property acquired by Kimco OP in a taxable transaction will initially have a tax basis equal to its fair market value, and Section 704(c) of the Code generally will not apply.

  • an estate, the income of which is subject to U.S. federal income tax regardless of its source; or
  • a trust that (1) is subject to the primary supervision of a U.S. court and the control of one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) or (2) has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes.

For purposes of this discussion, a “non-U.S. holder” is any beneficial owner of our capital stock or Kimco OP’s debt securities that is neither a U.S. holder nor an entity treated as a partnership for U.S. federal income tax purposes.

If an entity treated as a partnership for U.S. federal income tax purposes holds our capital stock or Kimco OP’s debt securities, the tax treatment of a partner in the partnership will depend on the status of the partner, the activities of the partnership and certain determinations made at the partner level. Accordingly, partnerships holding our capital stock or Kimco OP’s debt securities and the partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them.

Taxation of Taxable U.S. Holders of Our Capital Stock

Distributions Generally. Distributions out of our current or accumulated earnings and profits will be treated as dividends and, other than with respect to capital gain dividends and certain amounts which have previously been subject to corporate level tax, as discussed below, will be taxable to our taxable U.S. holders as ordinary income when actually or constructively received. See “—Tax Rates” below. As long as we qualify as a REIT, these distributions will not be eligible for the dividends-received deduction in the case of U.S. holders that are corporations or, except to the extent described in “—Tax Rates” below, the preferential rates on qualified dividend income applicable to non-corporate U.S. holders, including individuals. For purposes of determining whether distributions to holders of our capital stock are out of our current or accumulated earnings and profits, our earnings and profits will be allocated first to our outstanding preferred stock, if any, and then to our outstanding common stock.

To the extent that we make distributions on our capital stock in excess of our current and accumulated earnings and profits allocable to such stock, these distributions will be treated first as a tax-free return of capital to a U.S. holder to the extent of the U.S. holder’s adjusted tax basis in such shares of stock. This treatment will reduce the U.S. holder’s adjusted tax basis in such shares of stock by such amount, but not below zero. Distributions in excess of our current and accumulated earnings and profits and in excess of a U.S. holder’s adjusted tax basis in its shares will be taxable as capital gain. Such gain will be taxable as long-term capital gain if the shares have been held for more than one year. Dividends we declare in October, November, or December of any year and which are payable to a holder of record on a specified date in any of these months will be treated as both paid by us and received by the holder on December 31 of that year, provided we actually pay the dividend on or before January 31 of the following year. U.S. holders may not include in their own income tax returns any of our net operating losses or capital losses.

U.S. holders that receive taxable stock distributions, including distributions partially payable in our common stock and partially payable in cash, would be required to include the full amount of the distribution (i.e., the cash and the stock portion) as a dividend (subject to limited exceptions) to the extent of our current and accumulated earnings and profits for U.S. federal income tax purposes, as described above. The amount of any distribution payable in our common stock generally is equal to the amount of cash that could have been received instead of the common stock. Depending on the circumstances of a U.S. holder, the tax on the distribution may exceed the amount of the distribution received in cash, in which case such U.S. holder would have to pay the tax using cash from other sources. If a U.S. holder sells the common stock it received in connection with a taxable stock distribution in order to pay this tax and the proceeds of such sale are less than the amount required to be included in income with respect to the stock portion of the distribution, such U.S. holder could have a capital loss with respect to the stock sale that could not be used to offset such income. A U.S. holder that receives common stock pursuant to such distribution generally has a tax basis in such common stock equal to the amount of cash that could have been received instead of such common stock as described above, and has a holding period in such common stock that begins on the day immediately following the payment date for the distribution.

Capital Gain Dividends. Dividends that we properly designate as capital gain dividends will generally be taxable to our taxable U.S. holders as a gain from the sale or disposition of a capital asset held for more than one year, to the extent that such gain does not exceed our actual net capital gain for the taxable year and may not exceed our dividends paid for the taxable year, including dividends paid the following year that are treated as paid in the current year. U.S. holders that are corporations may, however, be required to treat up to 20% of certain capital gain dividends as ordinary income. If we properly designate any portion of a dividend as a capital gain dividend, then, except as otherwise required by law, we presently intend to allocate a portion of the total capital gain dividends paid or made available to holders of all classes of our capital stock for the year to the holders of each class of our

capital stock in proportion to the amount that our total dividends, as determined for U.S. federal income tax purposes, paid or made available to the holders of each such class of our capital stock for the year bears to the total dividends, as determined for U.S. federal income tax purposes, paid or made available to holders of all classes of our capital stock for the year. In addition, except as otherwise required by law, we will make a similar allocation with respect to any undistributed long-term capital gains which are to be included in our stockholders’ long-term capital gains, based on the allocation of the capital gain amount which would have resulted if those undistributed long-term capital gains had been distributed as “capital gain dividends” by us to our stockholders.

Retention of Net Capital Gains. We may elect to retain, rather than distribute as a capital gain dividend, all or a portion of our net capital gains. If we make this election, we would pay tax on our retained net capital gains. In addition, to the extent we so elect, our earnings and profits (determined for U.S. federal income tax purposes) would be adjusted accordingly, and a U.S. holder generally would:

  • include its pro rata share of our undistributed capital gain in computing its long-term capital gains in its U.S. federal income tax return for its taxable year in which the last day of our taxable year falls, subject to certain limitations as to the amount that is includable;
  • be deemed to have paid its share of the capital gains tax imposed on us on the designated amounts included in the U.S. holder’s income as long-term capital gain;
  • receive a credit or refund for the amount of tax deemed paid by it;
  • increase the adjusted tax basis of its capital stock by the difference between the amount of includable gains and the tax deemed to have been paid by it; and
  • in the case of a U.S. holder that is a corporation, appropriately adjust its earnings and profits for the retained capital gains in accordance with Treasury Regulations to be promulgated by the IRS.

Passive Activity Losses and Investment Interest Limitations. Distributions we make and gain arising from the sale or exchange of our capital stock by a U.S. holder will not be treated as passive activity income. As a result, U.S. holders generally will not be able to apply any “passive losses” against this income or gain. A U.S. holder generally may elect to treat capital gain dividends, capital gains from the disposition of our capital stock and income designated as qualified dividend income, as described in “—Tax Rates” below, as investment income for purposes of computing the investment interest limitation, but in such case, the holder will be taxed at ordinary income rates on such amount. Other distributions made by us, to the extent they do not constitute a return of capital, generally will be treated as investment income for purposes of computing the investment interest limitation.

Dispositions of Our Capital Stock. Except as described below under “—Taxation of Taxable U.S. Holders of Our Capital Stock—Redemption or Repurchase by Us,” if a U.S. holder sells or disposes of shares of our capital stock, it will recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference between the amount of cash and the fair market value of any property received on the sale or other disposition and the holder’s adjusted tax basis in the shares. This gain or loss, except as provided below, will be long-term capital gain or loss if the holder has held such capital stock for more than one year. However, if a U.S. holder recognizes a loss upon the sale or other disposition of capital stock that it has held for six months or less, after applying certain holding period rules, the loss recognized will be treated as a long-term capital loss to the extent the U.S. holder received distributions from us which were required to be treated as long-term capital gains. The deductibility of capital losses is subject to limitations.

Redemption or Repurchase by Us. A redemption or repurchase of shares of our capital stock will be treated under Section 302 of the Code as a distribution (and taxable as a dividend to the extent of our current and accumulated earnings and profits as described above under “—Distributions Generally”) unless the redemption or repurchase satisfies one of the tests set forth in Section 302(b) of the Code and is therefore treated as a sale or exchange of the redeemed or repurchased shares. The redemption or repurchase generally will be treated as a sale or exchange if it:

  • is “substantially disproportionate” with respect to the U.S. holder,
  • results in a “complete redemption” of the U.S. holder’s stock interest in us, or
  • is “not essentially equivalent to a dividend” with respect to the U.S. holder,

all within the meaning of Section 302(b) of the Code.

In determining whether any of these tests has been met, shares of our capital stock, including common stock and other equity interests in us, considered to be owned by the U.S. holder by reason of certain constructive ownership rules set forth in the Code, as well as shares of our capital stock actually owned by the U.S. holder, generally must be taken into account. Because the determination as to whether any of the alternative tests of Section 302(b) of the Code will be satisfied with respect to the U.S. holder depends upon the facts and circumstances at the time that the determination must be made, U.S. holders are advised to consult their tax advisors to determine such tax treatment.

If a redemption or repurchase of shares of our capital stock is treated as a distribution, the amount of the distribution will be measured by the amount of cash and the fair market value of any property received. See “—Distributions Generally.” A U.S. holder’s adjusted tax basis in the redeemed or repurchased shares generally will be transferred to the holder’s remaining shares of our capital stock, if any. If a U.S. holder owns no other shares of our capital stock, under certain circumstances, such basis may be transferred to a related person or it may be lost entirely. Prospective investors should consult their tax advisors regarding the U.S. federal income tax consequences of a redemption or repurchase of our capital stock.

If a redemption or repurchase of shares of our capital stock is not treated as a distribution, it will be treated as a taxable sale or exchange in the manner described under “—Dispositions of Our Capital Stock.”

Tax Rates. The maximum tax rate for non-corporate taxpayers for (1) long-term capital gains, including certain “capital gain dividends,” generally is 20% (although depending on the characteristics of the assets which produced these gains and on designations which we may make, certain capital gain dividends may be taxed at a 25% rate) and (2) “qualified dividend income” generally is 20%. In general, dividends payable by REITs are not eligible for the reduced tax rate on qualified dividend income, except to the extent that certain holding period requirements have been met and the REIT’s dividends are attributable to dividends received from taxable corporations (such as its taxable REIT subsidiaries) or to income that was subject to tax at the corporate/REIT level (for example, if the REIT distributed taxable income that it retained and paid tax on in the prior taxable year). Capital gain dividends will only be eligible for the rates described above to the extent that they are properly designated by the REIT as “capital gain dividends.” U.S. holders that are corporations may be required to treat up to 20% of some capital gain dividends as ordinary income. In addition, non-corporate U.S. holders, including individuals, generally may deduct up to 20% of dividends from a REIT, other than capital gain dividends and dividends treated as qualified dividend income, for purposes of determining their U.S. federal income tax (but not for purposes of the 3.8% Medicare tax), subject to certain holding period requirements and other limitations.

Taxation of Tax-Exempt Holders of Our Capital Stock

Dividend income from us and gain arising upon a sale of shares of our capital stock generally should not be unrelated business taxable income (“UBTI”) to a tax-exempt holder, except as described below. This income or gain will be UBTI, however, to the extent a tax-exempt holder holds its shares as “debt-financed property” within the meaning of the Code. Generally, “debt-financed property” is property the acquisition or holding of which was financed through a borrowing by the tax-exempt holder.

For tax-exempt holders that are social clubs, voluntary employee benefit associations or supplemental unemployment benefit trusts exempt from U.S. federal income taxation under Sections 501(c)(7), (c)(9) or (c)(17) of the Code, respectively, income from an investment in our shares will constitute UBTI unless the organization is able to properly claim a deduction for amounts set aside or placed in reserve for specific purposes so as to offset the income generated by its investment in our shares. These prospective investors should consult their tax advisors concerning these “set aside” and reserve requirements.

Notwithstanding the above, however, a portion of the dividends paid by a “pension-held REIT” may be treated as UBTI as to certain trusts that hold more than 10%, by value, of the interests in the REIT. A REIT will not be a “pension-held REIT” if it is able to satisfy the “not closely held” requirement without relying on the “look-through” exception with respect to certain trusts or if such REIT is not “predominantly held” by “qualified trusts.” As a result of restrictions on ownership and transfer of our stock contained in our charter, we do not expect to be classified as a “pension-held REIT,” and as a result, the tax treatment described above should be inapplicable to our holders. However, because our common stock is (and, we anticipate, will continue to be) publicly traded, we cannot guarantee that this will always be the case.

Taxation of Non-U.S. Holders of Our Capital Stock

The following discussion addresses the rules governing U.S. federal income taxation of the purchase, ownership and disposition of our capital stock by non-U.S. holders. These rules are complex, and no attempt is made herein to provide more than a brief summary of such rules. Accordingly, the discussion does not address all aspects of U.S. federal income taxation and does not

address other federal, state, local or non-U.S. tax consequences that may be relevant to a non-U.S. holder in light of its particular circumstances. We urge non-U.S. holders to consult their tax advisors to determine the impact of U.S. federal, state, local and non-U.S. income and other tax laws and any applicable tax treaty on the purchase, ownership and disposition of shares of our capital stock, including any reporting requirements.

Distributions Generally. Distributions (including any taxable stock distributions) that are neither attributable to gains from sales or exchanges by us of United States real property interests (“USRPIs”) nor designated by us as capital gain dividends (except as described below) will be treated as dividends of ordinary income to the extent that they are made out of our current or accumulated earnings and profits. Such distributions ordinarily will be subject to withholding of U.S. federal income tax at a 30% rate or such lower rate as may be specified by an applicable income tax treaty, unless the distributions are treated as effectively connected with the conduct by the non-U.S. holder of a trade or business within the United States (and, if required by an applicable income tax treaty, the non-U.S. holder maintains a permanent establishment in the United States to which such dividends are attributable). Under certain treaties, however, lower withholding rates generally applicable to dividends do not apply to dividends from a REIT. Certain certification and disclosure requirements must be satisfied for a non-U.S. holder to be exempt from withholding under the effectively connected income exemption. Dividends that are treated as effectively connected with a U.S. trade or business generally will not be subject to withholding but will be subject to U.S. federal income tax on a net basis at the regular rates, in the same manner as dividends paid to U.S. holders are subject to U.S. federal income tax. Any such dividends received by a non-U.S. holder that is a corporation may also be subject to an additional branch profits tax at a 30% rate (applicable after deducting U.S. federal income taxes paid on such effectively connected income) or such lower rate as may be specified by an applicable income tax treaty.

Except as otherwise provided below, we expect to withhold U.S. federal income tax at the rate of 30% on any distributions made to a non-U.S. holder unless:

  • a lower treaty rate applies and the non-U.S. holder furnishes an IRS Form W-8BEN or W-8BEN-E (or other applicable documentation) evidencing eligibility for that reduced treaty rate; or
  • the non-U.S. holder furnishes an IRS Form W-8ECI (or other applicable documentation) claiming that the distribution is income effectively connected with the non-U.S. holder’s trade or business.

Distributions in excess of our current and accumulated earnings and profits will not be taxable to a non-U.S. holder to the extent that such distributions do not exceed the adjusted tax basis of the holder’s capital stock, but rather will reduce the adjusted tax basis of such stock. To the extent that such distributions exceed the non-U.S. holder’s adjusted tax basis in such capital stock, they generally will give rise to gain from the sale or exchange of such stock, the tax treatment of which is described below. However, such excess distributions may be treated as dividend income for certain non-U.S. holders. For withholding purposes, we expect to treat all distributions as made out of our current or accumulated earnings and profits. However, amounts withheld may be refundable if it is subsequently determined that the distribution was, in fact, in excess of our current and accumulated earnings and profits, provided that certain conditions are met.

Capital Gain Dividends and Distributions Attributable to a Sale or Exchange of United States Real Property Interests. Distributions to a non-U.S. holder that we properly designate as capital gain dividends, other than those arising from the disposition of a USRPI, generally should not be subject to U.S. federal income taxation, unless:

  • the investment in our capital stock is treated as effectively connected with the conduct by the non-U.S. holder of a trade or business within the United States (and, if required by an applicable income tax treaty, the non-U.S. holder maintains a permanent establishment in the United States to which such dividends are attributable), in which case the non-U.S. holder will be subject to the same treatment as U.S. holders with respect to such gain, except that a non-U.S. holder that is a corporation may also be subject to a branch profits tax of up to 30%, as discussed above; or
  • the non-U.S. holder is a nonresident alien individual who is present in the United States for 183 days or more during the taxable year and certain other conditions are met, in which case the non-U.S. holder will be subject to U.S. federal income tax at a rate of 30% on the non-U.S. holder’s capital gains (or such lower rate specified by an applicable income tax treaty), which may be offset by U.S. source capital losses of such non-U.S. holder (even though the individual is not considered a resident of the United States), provided the non-U.S. holder has timely filed U.S. federal income tax returns with respect to such losses.

Pursuant to the Foreign Investment in Real Property Tax Act, which is referred to as “FIRPTA,” distributions to a non-U.S. holder that are attributable to gain from sales or exchanges by us of USRPIs, whether or not designated as capital gain dividends, will cause the non-U.S. holder to be treated as recognizing such gain as income effectively connected with a U.S. trade or business. Non-U.S. holders generally would be taxed at the regular rates applicable to U.S. holders, subject to any applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals. We also will be required to withhold

and to remit to the IRS 21% of any distribution to non-U.S. holders attributable to gain from sales or exchanges by us of USRPIs. Distributions subject to FIRPTA may also be subject to a 30% branch profits tax in the hands of a non-U.S. holder that is a corporation. The amount withheld is creditable against the non-U.S. holder’s U.S. federal income tax liability. However, any distribution with respect to any class of stock that is “regularly traded,” as defined by applicable Treasury Regulations, on an established securities market located in the United States is not subject to FIRPTA, and therefore, not subject to the 21% U.S. withholding tax described above, if the non-U.S. holder did not own more than 10% of such class of stock at any time during the one-year period ending on the date of the distribution. Instead, such distributions generally will be treated as ordinary dividend distributions and subject to withholding in the manner described above with respect to ordinary dividends. In addition, distributions to certain non-U.S. publicly traded shareholders that meet certain record-keeping and other requirements (“qualified shareholders”) are exempt from FIRPTA, except to the extent owners of such qualified shareholders that are not also qualified shareholders own, actually or constructively, more than 10% of our capital stock. Furthermore, distributions to certain “qualified foreign pension funds” or entities all of the interests of which are held by such “qualified foreign pension funds” are exempt from FIRPTA. Non-U.S. holders should consult their tax advisors regarding the application of these rules.

Retention of Net Capital Gains. Although the law is not clear on the matter, it appears that amounts we designate as retained net capital gains in respect of our capital stock should be treated with respect to non-U.S. holders as actual distributions of capital gain dividends. Under this approach, the non-U.S. holders may be able to offset as a credit against their U.S. federal income tax liability their proportionate share of the tax paid by us on such retained net capital gains and to receive from the IRS a refund to the extent their proportionate share of such tax paid by us exceeds their actual U.S. federal income tax liability. If we were to designate any portion of our net capital gain as retained net capital gain, non-U.S. holders should consult their tax advisors regarding the taxation of such retained net capital gain.

Sale of Our Capital Stock. Except as described below under “—Redemption or Repurchase by Us,” gain realized by a non-U.S. holder upon the sale, exchange or other taxable disposition of our capital stock generally will not be subject to U.S. federal income tax unless such stock constitutes a USRPI. In general, stock of a domestic corporation that constitutes a “United States real property holding corporation,” or USRPHC, will constitute a USRPI. We believe that we are a USRPHC. Our capital stock will not, however, constitute a USRPI so long as we are a “domestically controlled qualified investment entity.” A “domestically controlled qualified investment entity” includes a REIT in which at all times during a five-year testing period less than 50% in value of its stock is held directly or indirectly by non-United States persons, subject to certain ownership rules. For purposes of determining whether a REIT is a “domestically controlled qualified investment entity,” ownership by non-United States persons generally will be determined by looking through certain pass-through entities and U.S. corporations, including non-public REITs and certain non-public foreign-controlled domestic C corporations, and treating a public qualified investment entity as a non-United States person unless such entity is a “domestically controlled qualified investment entity.” Notwithstanding the foregoing ownership rules, a person who at all applicable times holds less than 5% of a class of a REIT’s stock that is “regularly traded” on an established securities market in the United States is treated as a United States person unless the REIT has actual knowledge that such person is not a United States person or is a foreign-controlled person. We believe, but cannot guarantee, that we are a “domestically controlled qualified investment entity.” Because our common stock is (and, we anticipate, will continue to be) publicly traded, no assurance can be given that we will continue to be a “domestically controlled qualified investment entity.”

Even if we do not qualify as a “domestically controlled qualified investment entity” at the time a non-U.S. holder sells our capital stock, gain realized from the sale or other taxable disposition by a non-U.S. holder of such capital stock would not be subject to U.S. federal income tax under FIRPTA as a sale of a USRPI if:

  • such class of stock is “regularly traded,” as defined by applicable Treasury Regulations, on an established securities market such as the New York Stock Exchange; and
  • such non-U.S. holder owned, actually and constructively, 10% or less of such class of stock throughout the shorter of the five-year period ending on the date of the sale or other taxable disposition or the non-U.S. holder’s holding period.

In addition, dispositions of our capital stock by qualified shareholders are exempt from FIRPTA, except to the extent owners of such qualified shareholders that are not also qualified shareholders own, actually or constructively, more than 10% of our capital stock. Furthermore, dispositions of our capital stock by certain “qualified foreign pension funds” or entities all of the interests of which are held by such “qualified foreign pension funds” are exempt from FIRPTA. Non-U.S. holders should consult their tax advisors regarding the application of these rules.

Notwithstanding the foregoing, gain from the sale, exchange or other taxable disposition of our capital stock not otherwise subject to FIRPTA will be taxable to a non-U.S. holder if either (a) the investment in our capital stock is treated as effectively

connected with the conduct by the non-U.S. holder of a trade or business within the United States (and, if required by an applicable income tax treaty, the non-U.S. holder maintains a permanent establishment in the United States to which such gain is attributable), in which case the non-U.S. holder will be subject to the same treatment as U.S. holders with respect to such gain, except that a non-U.S. holder that is a corporation may also be subject to the 30% branch profits tax (or such lower rate as may be specified by an applicable income tax treaty) on such gain, as adjusted for certain items, or (b) the non-U.S. holder is a nonresident alien individual who is present in the United States for 183 days or more during the taxable year and certain other conditions are met, in which case the non-U.S. holder will be subject to a 30% tax on the non-U.S. holder’s capital gains (or such lower rate specified by an applicable income tax treaty), which may be offset by U.S. source capital losses of the non-U.S. holder (even though the individual is not considered a resident of the United States), provided the non-U.S. holder has timely filed U.S. federal income tax returns with respect to such losses. In addition, even if we are a domestically controlled qualified investment entity, upon disposition of our capital stock, a non-U.S. holder may be treated as having gain from the sale or other taxable disposition of a USRPI if the non-U.S. holder (1) disposes of such stock within a 30-day period preceding the ex-dividend date of a distribution, any portion of which, but for the disposition, would have been treated as gain from the sale or exchange of a USRPI and (2) acquires, or enters into a contract or option to acquire, or is deemed to acquire, other shares of that stock during the 61-day period beginning with the first day of the 30-day period described in clause (1), unless such class of stock is “regularly traded” and the non-U.S. holder did not own more than 10% of such class of stock at any time during the one-year period ending on the date of the distribution described in clause (1).

If gain on the sale, exchange or other taxable disposition of our capital stock were subject to taxation under FIRPTA, the non-U.S. holder would be required to file a U.S. federal income tax return and would be subject to regular U.S. federal income tax with respect to such gain in the same manner as a taxable U.S. holder (subject to any applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals). In addition, if the sale, exchange or other taxable disposition of our capital stock were subject to taxation under FIRPTA, and if shares of the applicable class of our capital stock were not “regularly traded” on an established securities market, the purchaser of such capital stock generally would be required to withhold and remit to the IRS 15% of the purchase price.

Redemption or Repurchase by Us. A redemption or repurchase of shares of our capital stock will be treated under Section 302 of the Code as a distribution (and taxable as a dividend to the extent of our current and accumulated earnings and profits) unless the redemption or repurchase satisfies one of the tests set forth in Section 302(b) of the Code and is therefore treated as a sale or exchange of the redeemed or repurchased shares. See “—Taxation of Taxable U.S. Holders of Our Capital Stock—Redemption or Repurchase by Us.” Qualified shareholders and their owners may be subject to different rules, and should consult their tax advisors regarding the application of such rules. If the redemption or repurchase of shares is treated as a distribution, the amount of the distribution will be measured by the amount of cash and the fair market value of any property received. See “—Taxation of Non-U.S. Holders of Our Capital Stock—Distributions Generally” above. If the redemption or repurchase of shares is not treated as a distribution, it will be treated as a taxable sale or exchange in the manner described above under “—Sale of Our Capital Stock.”

Taxation of Holders of Kimco OP’s Debt Securities

The following summary describes certain material U.S. federal income tax consequences of purchasing, owning and disposing of debt securities issued by Kimco OP. This discussion assumes the debt securities will be issued with less than a statutory de minimis amount of original issue discount for U.S. federal income tax purposes. In addition, this discussion is limited to persons purchasing the debt securities for cash at original issue and at their original “issue price” within the meaning of Section 1273 of the Code (i.e., the first price at which a substantial amount of the debt securities is sold to the public for cash).

U.S. Holders

Payments of Interest. Interest on a debt security generally will be taxable to a U.S. holder as ordinary income at the time such interest is received or accrued, in accordance with such U.S. holder’s method of accounting for U.S. federal income tax purposes.

Sale or Other Taxable Disposition. A U.S. holder will recognize gain or loss on the sale, exchange, redemption, retirement or other taxable disposition of a debt security. The amount of such gain or loss generally will be equal to the difference between the amount received for the debt security in cash or other property valued at fair market value (less amounts attributable to any accrued but unpaid interest, which will be taxable as interest to the extent not previously included in income) and the U.S. holder’s adjusted tax basis in the debt security. A U.S. holder’s adjusted tax basis in a debt security generally will be equal to the amount the U.S. holder paid for the debt security. Any gain or loss generally will be capital gain or loss, and will be long-term capital gain or loss if the U.S. holder has held the debt security for more than one year at the time of such sale or other taxable disposition. Otherwise,

such gain or loss will be short-term capital gain or loss. Long-term capital gains recognized by certain non-corporate U.S. holders, including individuals, generally will be taxable at reduced rates. The deductibility of capital losses is subject to limitations.

Non-U.S. Holders

Payments of Interest. Interest paid on a debt security to a non-U.S. holder that is not effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States generally will not be subject to U.S. federal income tax or withholding, provided that:

  • the non-U.S. holder does not, actually or constructively, own 10% or more of Kimco OP’s capital or profits;
  • the non-U.S. holder is not a controlled foreign corporation related to Kimco OP through actual or constructive stock ownership; and;
  • either (1) the non-U.S. holder certifies in a statement provided to the applicable withholding agent under penalties of perjury that it is not a United States person and provides its name and address; (2) a securities clearing organization, bank or other financial institution that holds customers’ securities in the ordinary course of its trade or business and holds the debt security on behalf of the non-U.S. holder certifies to the applicable withholding agent under penalties of perjury that it, or the financial institution between it and the non-U.S. holder, has received from the non-U.S. holder a statement under penalties of perjury that such holder is not a United States person and provides the applicable withholding agent with a copy of such statement; or (3) the non-U.S. holder holds its debt security directly through a “qualified intermediary” (within the meaning of the applicable Treasury Regulations) and certain conditions are satisfied.

If a non-U.S. holder does not satisfy the requirements above, such non-U.S. holder will be subject to withholding tax of 30%, subject to a reduction in or an exemption from withholding on such interest as a result of an applicable tax treaty. To claim such entitlement, the non-U.S. holder must provide the applicable withholding agent with a properly executed IRS Form W-8BEN or W-8BEN-E (or other applicable documentation) claiming a reduction in or exemption from withholding tax under the benefit of an income tax treaty between the United States and the country in which the non-U.S. holder resides or is established.

If interest paid to a non-U.S. holder is effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the non-U.S. holder maintains a permanent establishment in the United States to which such interest is attributable), the non-U.S. holder will be exempt from the U.S. federal withholding tax described above. To claim the exemption, the non-U.S. holder must furnish to the applicable withholding agent a valid IRS Form W-8ECI, certifying that interest paid on a debt security is not subject to withholding tax because it is effectively connected with the conduct by the non-U.S. holder of a trade or business within the United States.

Any such effectively connected interest generally will be subject to U.S. federal income tax at the regular rates. A non-U.S. holder that is a corporation may also be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such effectively connected interest, as adjusted for certain items.

The certifications described above must be provided to the applicable withholding agent prior to the payment of interest and must be updated periodically. Non-U.S. holders that do not timely provide the applicable withholding agent with the required certification, but that qualify for a reduced rate under an applicable income tax treaty, may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS. Non-U.S. holders should consult their tax advisors regarding their entitlement to benefits under any applicable income tax treaty.

Sale or Other Taxable Disposition. A non-U.S. holder will not be subject to U.S. federal income tax on any gain realized upon the sale, exchange, redemption, retirement or other taxable disposition of a debt security (such amount excludes any amount allocable to accrued and unpaid interest, which generally will be treated as interest and may be subject to the rules discussed above in “—Taxation of Holders of Kimco OP’s Debt Securities—Non-U.S. Holders—Payments of Interest”) unless:

  • the gain is effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the non-U.S. holder maintains a permanent establishment in the United States to which such gain is attributable); or
  • the non-U.S. holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition and certain other requirements are met

Gain described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular rates. A non-U.S. holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such effectively connected gain, as adjusted for certain items.

A non-U.S. holder described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on gain realized upon the sale or other taxable disposition of a debt security, which may be offset by U.S. source capital losses of the non-U.S. holder (even though the individual is not considered a resident of the United States), provided the non-U.S. holder has timely filed U.S. federal income tax returns with respect to such losses.

Non-U.S. holders should consult their tax advisors regarding any applicable income tax treaties that may provide for different rules.

Information Reporting and Backup Withholding

U.S. Holders. A U.S. holder may be subject to information reporting and backup withholding when such holder receives payments on our capital stock or Kimco OP’s debt securities or proceeds from the sale or other taxable disposition of such stock or debt securities (including a redemption or retirement of a debt security). Certain U.S. holders are exempt from backup withholding, including corporations and certain tax-exempt organizations. A U.S. holder will be subject to backup withholding if such holder is not otherwise exempt and:

  • the holder fails to furnish the holder’s taxpayer identification number, which for an individual is ordinarily his or her social security number;
  • the holder furnishes an incorrect taxpayer identification number;
  • the applicable withholding agent is notified by the IRS that the holder previously failed to properly report payments of interest or dividends; or
  • the holder fails to certify under penalties of perjury that the holder has furnished a correct taxpayer identification number and that the IRS has not notified the holder that the holder is subject to backup withholding.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a U.S. holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS. U.S. holders should consult their tax advisors regarding their qualification for an exemption from backup withholding and the procedures for obtaining such an exemption.

Non-U.S. Holders. Payments of dividends on our capital stock or interest on Kimco OP’s debt securities generally will not be subject to backup withholding, provided the applicable withholding agent does not have actual knowledge or reason to know the holder is a United States person and the holder either certifies its non-U.S. status, such as by furnishing a valid IRS Form W-8BEN, W-8BEN-E or W-8ECI, or otherwise establishes an exemption. However, information returns are required to be filed with the IRS in connection with any distributions on our capital stock or interest on Kimco OP’s debt securities paid to the non-U.S. holder, regardless of whether such distributions constitute a dividend or whether any tax was actually withheld. In addition, proceeds of the sale or other taxable disposition of such stock or debt securities (including a retirement or redemption of a debt security) within the United States or conducted through certain U.S.-related brokers generally will not be subject to backup withholding or information reporting if the applicable withholding agent receives the certification described above and does not have actual knowledge or reason to know that such holder is a United States person, or the holder otherwise establishes an exemption. Proceeds of a disposition of such stock or debt securities conducted through a non-U.S. office of a non-U.S. broker generally will not be subject to backup withholding or information reporting.

Copies of information returns that are filed with the IRS may also be made available under the provisions of an applicable treaty or agreement to the tax authorities of the country in which the non-U.S. holder resides or is established.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a non-U.S. holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS.

Medicare Contribution Tax on Unearned Income

Certain U.S. holders that are individuals, estates or trusts are required to pay an additional 3.8% tax on, among other things, dividends on stock, interest on debt obligations, and capital gains from the sale or other disposition of stock or debt obligations, subject to certain limitations. U.S. holders should consult their tax advisors regarding the effect, if any, of these rules on their ownership and disposition of our capital stock or Kimco OP’s debt securities.

Additional Withholding Tax on Payments Made to Foreign Accounts

Withholding taxes may be imposed under Sections 1471 to 1474 of the Code (such sections commonly referred to as the Foreign Account Tax Compliance Act (“FATCA”)) on certain types of payments made to non-U.S. financial institutions and certain other non-U.S. entities. Specifically, a 30% withholding tax may be imposed on dividends on our capital stock, interest on Kimco OP’s debt securities, or (subject to the proposed Treasury Regulations discussed below) gross proceeds from the sale or other disposition of our capital stock or Kimco OP’s debt securities, in each case paid to a “foreign financial institution” or a “non-financial foreign entity” (each as defined in the Code), unless (1) the foreign financial institution undertakes certain diligence and reporting obligations, (2) the non-financial foreign entity either certifies it does not have any “substantial United States owners” (as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (3) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in clause (1) above, it must enter into an agreement with the U.S. Department of the Treasury requiring, among other things, that it undertake to identify accounts held by certain “specified United States persons” or “United States owned foreign entities” (each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules.

Under the applicable Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends on our capital stock or interest on Kimco OP’s debt securities. While withholding under FATCA would have applied also to payments of gross proceeds from the sale or other disposition of stock or debt securities on or after January 1, 2019, proposed Treasury Regulations eliminate FATCA withholding on payments of gross proceeds entirely. Taxpayers generally may rely on these proposed Treasury Regulations until final Treasury Regulations are issued. Because we may not know the extent to which a distribution is a dividend for U.S. federal income tax purposes at the time it is made, for purposes of these withholding rules we may treat the entire distribution as a dividend.

Prospective investors should consult their tax advisors regarding the potential application of withholding under FATCA to their investment in our capital stock or Kimco OP’s debt securities.

Other Tax Consequences

State, local and non-U.S. income tax laws may differ substantially from the corresponding U.S. federal income tax laws, and this discussion does not purport to describe any aspect of the tax laws of any state, local or non-U.S. jurisdiction, or any U.S. federal tax other than income tax. You should consult your tax advisors regarding the effect of state, local and non-U.S. tax laws with respect to our tax treatment as a REIT and on an investment in our capital stock or Kimco OP’s debt securities.

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