EX-99.2 3 exhibit992-supplementaldis.htm EXHIBIT 99.2 Exhibit
Exhibit 99.2




 
 
URBAN EDGE PROPERTIES
 
SUPPLEMENTAL DISCLOSURE
PACKAGE
 
June 30, 2017
 
 



image3a07.jpg




 
 
 
 
Urban Edge Properties
888 7th Avenue, New York, NY 10019
NY Office: 212-956-2556
www.uedge.com
 






URBAN EDGE PROPERTIES
SUPPLEMENTAL DISCLOSURE
June 30, 2017
(unaudited)
 
 
TABLE OF CONTENTS
 
Page
Press Release
 
Second Quarter 2017 Earnings Press Release
1
 
 
Overview
 
Summary Financial Results and Ratios
10
 
 
Consolidated Financial Statements
 
Consolidated Balance Sheets
11
Consolidated Statements of Income
12
 
 
Non-GAAP Financial Measures and Supplemental Data
 
Supplemental Schedule of Net Operating Income
13
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
14
Funds from Operations
15
Market Capitalization, Debt Ratios and Liquidity
16
Additional Disclosures
17
 
 
Leasing Data
 
Tenant Concentration - Top Twenty-Five Tenants
18
Leasing Activity
19
Retail Portfolio Lease Expiration Schedules
20
 
 
Property Data
 
Property Status Report
22
Property Acquisitions and Dispositions
25
Development, Redevelopment and Anchor Repositioning Projects
26
 
 
Debt Schedules
 
Debt Summary
28
Mortgage Debt Summary and Debt Maturity Schedule
29
 
 







 
image2a09.jpg
 
 
 
 
 
Urban Edge Properties
For additional information:
888 Seventh Avenue
Mark Langer, EVP and
New York, NY 10019
Chief Financial Officer
212-956-2556
 
 
 
 
 
 
 
 
 
FOR IMMEDIATE RELEASE:
 
 
 
 
Urban Edge Properties Reports Second Quarter 2017 Results


        
NEW YORK, NY, August 2, 2017 - Urban Edge Properties (NYSE:UE) (the "Company") today announced its results for the three and six months ended June 30, 2017.

Financial Results(1)(2) 
•
Generated net income of $14.9 million, or $0.13 per diluted share, for the quarter and $69.7 million, or $0.63 per diluted share, for the six months ended June 30, 2017.
•
Generated Funds from Operations applicable to diluted common shareholders ("FFO") of $38.7 million, or $0.34 per share, for the quarter and $112.1 million, or $1.01 per share, for the six months ended June 30, 2017.
•
Generated FFO as Adjusted of $0.33 per share for the quarter and $0.66 per share for the six months ended June 30, 2017, an increase of 6.5% per share compared to both the second quarter of 2016 and the six months ended June 30, 2016.

Operating Results(1) 
•
Increased same-property cash Net Operating Income (“NOI”) by 5.0% compared to the second quarter of 2016 and by 5.3% compared to the six months ended June 30, 2016, primarily due to rent commencements at Garfield Commons, Kearny Commons and Bergen Town Center and higher recoveries.
•
Increased same-property cash NOI including properties in redevelopment by 5.6% compared to the second quarter of 2016 and by 6.1% compared to the six months ended June 30, 2016. Rent commencements at East Hanover warehouses, Walnut Creek and Montehiedra contributed to this growth.
•
Reported a decline in consolidated retail portfolio occupancy of 30 basis points to 95.9% compared to June 30, 2016 and 130 basis points compared to March 31, 2017, primarily as a result of acquiring centers with lower occupancy than our existing portfolio.
•
Increased same-property retail portfolio occupancy by 90 basis points to 98.2% compared to June 30, 2016 and reported a decrease of 10 basis points compared to March 31, 2017.
•
Executed 31 new leases, renewals and options totaling 373,000 square feet (sf) during the quarter. Same-space leases totaled 338,000 sf and generated average rent spreads of 1.7% on a GAAP basis and (2.7)% on a cash basis.

Acquisition and Disposition Activity
•
Acquired seven retail assets, predominantly in the New York metro area, totaling $325 million during the quarter. Funding for these acquisitions was comprised of approximately $122 million in UE operating partnership units valued at $27.02 per unit (4.5 million units), approximately $33 million of assumed debt, the issuance of approximately $126 million in non-recourse, mortgage loans and approximately $44 million in cash.






1

•
During the six months ended June 30, 2017, the Company acquired a total of nine retail assets as follows:
Date Acquired
 
Property
 
Location
 
GLA SF
 
Occupancy
 
Purchase Price
 
 
 
 
 
 
 
 
 
 
 
1/17/2017
 
Shops at Bruckner
 
Bronx, NY
 
114,000
 
100%
 
$
32,000

2/2/2017
 
Hudson Mall
 
Jersey City, NJ
 
383,000
 
97%
 
43,700

5/24/2017
 
Yonkers Gateway Center
(2 transactions)(3)
 
Yonkers, NY
 
437,000
 
88%
 
152,388

5/24/2017
 
The Plaza at Cherry Hill
 
Cherry Hill, NJ
 
413,000
 
74%
 
51,348

5/24/2017
 
Manchester Plaza
 
Manchester, MO
 
131,000
 
89%
 
19,794

5/24/2017
 
Millburn Gateway Center
 
Millburn, NJ
 
102,000
 
97%
 
43,748

5/24/2017
 
21 E Broad St/One Lincoln Plaza
 
Westfield, NJ
 
22,000
 
100%
 
9,670

5/25/2017
 
The Plaza at Woodbridge
 
Woodbridge, NJ
 
411,000
 
81%
 
99,752

 
 
 
 
Total
2,013,000
 
87%
 
$
452,400


•
Completed the sale of a 32,000 sf vacant building located in Eatontown, NJ for $5.0 million on June 30, 2017.

Development, Redevelopment and Anchor Repositioning Activity
•
Advanced thirteen active projects. Estimated gross cost for active and completed projects totals $203.4 million, a $10.3 million increase over the first quarter of 2017. Increased project costs are primarily offset by increased revenue from new tenant leases. These projects are expected to generate a 10% return. Of the $203.4 million, $96.8 million remains to be funded.
•
Sixteen additional pipeline projects are expected to earn 9% on the projected investment of $69-86 million.

Financing Activity
•
On May 10, 2017, issued 7.7 million common shares through an underwritten public offering generating cash proceeds of $193.5 million. The Company intends to use the net proceeds of this offering for development and redevelopment projects and for general corporate purposes including potential acquisitions that may be identified in the future.

Balance Sheet Highlights at June 30, 2017(1)(4) 
•
Total market capitalization of approximately $4.3 billion comprising 120.4 million, fully diluted common shares valued at $2.9 billion and $1.4 billion of debt.
•
Net debt to total market capitalization of 27%.
•
Net debt to Adjusted Earnings before interest, tax, depreciation and amortization ("EBITDA") of 5.6x.
•
$248 million of cash and cash equivalents and no amounts drawn on the $600 million revolving credit facility.


















(1) Refer to "Non-GAAP Financial Measures" and "Operating Metrics" for definitions and additional detail.
(2) Refer to page 5 for a reconciliation of FFO to FFO as Adjusted for the three and six months ended June 30, 2017.
(3) The acquisition of Yonkers Gateway Center closed in two transactions. On January 4, 2017, the Company acquired fee and leasehold interests for $51.7 million. On May 24, 2017, the Company acquired the remaining fee and leasehold interests not previously acquired for $100.7 million.
(4) The tables accompanying this press release provide the calculation of fully diluted common shares and a reconciliation of net income to EBITDA and Adjusted EBITDA.

2

Non-GAAP Financial Measures
The Company uses certain non-GAAP performance measures, in addition to the primary GAAP presentations, as we believe these measures improve the understanding of the Company's operational results. We continually evaluate the usefulness, relevance, limitations, and calculation of our reported non-GAAP performance measures to determine how best to provide relevant information to the investing public, and thus such reported measures are subject to change. The Company's non-GAAP performance measures have limitations as they do not include all items of income and expense that affect operations, and accordingly, should always be considered as supplemental financial results. The following non-GAAP measures are commonly used by the Company and investing public to understand and evaluate our operating results and performance:
•
FFO: The Company believes FFO is a useful, supplemental measure of its operating performance that is a recognized metric used extensively by the real estate industry and, in particular REITs. FFO, as defined by the National Association of Real Estate Investment Trusts ("NAREIT") and the Company, is net income (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciated real estate assets, real estate impairment losses, rental property depreciation and amortization expense. The Company believes that financial analysts, investors and stockholders are better served by the presentation of comparable period operating results generated from FFO primarily because it excludes the assumption that the value of real estate assets diminish predictably. FFO does not represent cash flows from operating activities in accordance with GAAP, should not be considered an alternative to net income as an indication of our performance, and is not indicative of cash flow as a measure of liquidity or our ability to make cash distributions.
•
FFO as Adjusted: The Company provides disclosure of FFO as Adjusted because it believes it is a useful supplemental measure of its core operating performance that facilitates comparability of historical financial periods. FFO as Adjusted is calculated by making certain adjustments to FFO to account for items the Company does not believe are representative of ongoing core operating results including transaction costs associated with acquisition and disposition activity and non-comparable revenues and expenses. The Company's method of calculating FFO as Adjusted may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
•
Cash NOI: The Company uses cash NOI internally to make investment and capital allocation decisions and to compare the unlevered performance of our properties to our peers. The Company believes cash NOI is useful to investors as a performance measure because, when compared across periods, cash NOI reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and disposition activity on an unleveraged basis, providing perspective not immediately apparent from operating income or net income. The Company calculates cash NOI using net income as defined by GAAP reflecting only those income and expense items that are incurred at the property level, adjusted for the following items: lease termination fees, bankruptcy settlement income, non-cash rental income and ground rent expense and income or expenses that we do not believe are representative of ongoing operating results, if any.
•
Same-property Cash NOI: The Company provides disclosure of cash NOI on a same-property basis, which includes the results of properties that were owned and operated for the entirety of the reporting periods being compared totaling 76 properties for the three and six months ended June 30, 2017 and 2016. Information provided on a same-property basis excludes properties under development, redevelopment or that involve anchor repositioning where a substantial portion of the gross leasable area ("GLA") is taken out of service and also excludes properties acquired, sold, under contract to be sold, or that are in the foreclosure process during the periods being compared. As such, same-property cash NOI assists in eliminating disparities in net income due to the development, redevelopment, acquisition or disposition of properties during the periods presented, and thus provides a more consistent performance measure for the comparison of the operating performance of the Company's properties. While there is judgment surrounding changes in designations, a property is removed from the same-property pool when it is designated as a redevelopment property because it is undergoing significant renovation or retenanting pursuant to a formal plan that is expected to have a significant impact on its operating income. A development or redevelopment property is moved back to the same-property pool once a substantial portion of the NOI growth expected from the development or redevelopment is reflected in both the current and comparable prior year period, generally one year after at least 80% of the expected NOI from the project is realized on a cash basis for a full quarter. Acquisitions are moved into the same-property pool once we have owned the property for the entirety of the comparable periods and the property is not under significant development or redevelopment. The Company has also provided disclosure of cash NOI on a same-property basis adjusted to include redevelopment properties.
•
EBITDA and Adjusted EBITDA: EBITDA and Adjusted EBITDA are supplemental, non-GAAP measures utilized by us in various financial ratios. EBITDA and Adjusted EBITDA are presented to assist investors in the evaluation

3

of REITs, as a measure of the Company's operational performance as they exclude various items that do not relate to or are not indicative of our operating performance and because they approximate key performance measures in our debt covenants. Accordingly, the Company believes that the use of EBITDA and Adjusted EBITDA, as opposed to income before income taxes in various ratios, provides meaningful performance measures related to the Company's ability to meet various coverage tests for the stated periods. The Company also presents the ratio of net debt (net of cash) to annualized Adjusted EBITDA, which it believes is useful to investors as a supplemental measure in evaluating the Company's balance sheet leverage.
The Company believes net income is the most directly comparable GAAP financial measure to the non-GAAP performance measures outlined above. Reconciliations of these measures to net income have been provided in the tables accompanying this press release.

Operating Metrics

The Company presents certain operating metrics related to our properties including occupancy, leasing activity and rental rates. Operating metrics are used by the Company and are useful to investors in facilitating an understanding of the operational performance for our properties.

Occupancy metrics represent the percentage of occupied gross leasable area based on executed leases (including properties in development and redevelopment) and includes leases signed, but for which rent has not yet commenced. Same-property retail portfolio occupancy includes shopping centers and malls that have been owned and operated for the entirety of the reporting periods being compared totaling 76 properties for the three and six months ended June 30, 2017 and 2016. Occupancy metrics presented for the Company's same-property retail portfolio excludes properties under development, redevelopment or that involve anchor repositioning where a substantial portion of the gross leasable area is taken out of service and also excludes properties acquired within the past 12 months, properties sold, under contract to be sold, or that are in the foreclosure process during the periods being compared.

Executed new leases, renewals and exercised options are presented on a same-space basis. Same-space leases represent those leases signed on spaces for which there was a previous lease with comparable gross leasable area.









4

Reconciliation of Net Income to FFO and FFO as Adjusted

The following table reflects the reconciliation of net income to FFO and FFO as Adjusted for the three and six months ended June 30, 2017. Net income is considered the most directly comparable GAAP measure. Refer to "Non-GAAP Financial Measures" on page 3 for a description of FFO and FFO as Adjusted.

 
Three Months Ended
June 30, 2017
 
Six Months Ended
June 30, 2017
 
(in thousands)
 
(per share)
 
(in thousands)
 
(per share)
Net income
$
14,920

 
$
0.13

 
$
69,655

 
$
0.63

Less (net income) attributable to noncontrolling interests in:
 
 
 
 
 
 
 
Operating partnership
(1,326
)
 
(0.01
)
 
(5,464
)
 
(0.05
)
Consolidated subsidiaries
(11
)
 
—

 
(22
)
 
—

Net income attributable to common shareholders
13,583

 
0.12

 
64,169

 
0.58

Adjustments:
 
 
 
 
 
 
 
Rental property depreciation and amortization
23,452

 
0.21

 
39,031

 
0.35

Real estate impairment loss
303

 
—

 
3,467

 
0.03

Limited partnership interests in operating partnership
1,326

 
0.01

 
5,464

 
0.05

FFO applicable to diluted common shareholders(1)
38,664

 
0.34

 
112,131

 
1.01

 
 
 
 
 
 
 
 
Transaction costs
132

 
—

 
183

 
—

Loss on extinguishment of debt
—

 
—

 
1,274

 
0.01

Tenant bankruptcy settlement income
(486
)
 
(0.01
)
 
(513
)
 
(0.01
)
Income from acquired leasehold interest(2)
—

 
—

 
(39,215
)
 
(0.35
)
FFO as Adjusted applicable to diluted common shareholders(1)
$
38,310

 
$
0.33

 
$
73,860


$
0.66

 
 
 
 
 
 
 
 
Weighted average diluted common shares - FFO(1)
114,433

 
 
 
111,224

 
 
(1) Refer to the table below for reconciliation of weighted average diluted shares used in EPS calculations and weighted average diluted common shares used in FFO per share calculations.
(2) Income from acquired leasehold interest at the Shops at Bruckner includes the write-off of unamortized intangible liability related to the below-market ground lease acquired and existing straight-line receivable balance.

The following table reflects the reconciliation of weighted average diluted shares used in EPS calculations and weighted average diluted common shares used in FFO per share calculations.
(in thousands)
Three Months Ended
June 30, 2017
 
Six Months Ended
June 30, 2017
Weighted average diluted shares used to calculate EPS
104,260

 
111,224

Assumed conversion of OP and LTIP Units to common stock(1)
10,173

 
—

Weighted average diluted common shares used to calculate
FFO per share
114,433

 
111,224

(1) Operating Partnership ("OP") and Long-Term Incentive Plan ("LTIP") Units are excluded from the calculation of earnings per diluted share for the three months ended June 30, 2017, because their inclusion is anti-dilutive and included for the six months ended June 30, 2017, because their inclusion is dilutive. FFO includes earnings allocated to unitholders as the inclusion of these units is dilutive to FFO per share.



5

Reconciliation of Net Income to Cash NOI and Same-Property Cash NOI

The following table reflects the reconciliation of net income to cash NOI, same-property cash NOI and same-property cash NOI including properties in redevelopment for the three and six months ended June 30, 2017 and 2016. Net income is considered the most directly comparable GAAP measure. Refer to "Non-GAAP Financial Measures" on page 3 for a description of cash NOI and same-property cash NOI.

 
Three Months Ended June 30, 2017
 
Six Months Ended
June 30, 2017
(Amounts in thousands)
2017
 
2016
 
2017
 
2016
Net income
$
14,920

 
$
36,071

 
$
69,655

 
$
55,859

Add: income tax expense (benefit)
304

 
(306
)
 
624

 
30

Income before income taxes
15,224

 
35,765

 
70,279

 
55,889

  Interest income
(336
)
 
(177
)
 
(463
)
 
(344
)
  Gain on sale of real estate
—

 
(15,618
)
 
—

 
(15,618
)
  Interest and debt expense
13,627

 
12,820

 
26,742

 
26,249

  Loss on extinguishment of debt
—

 
—

 
1,274

 
—

Operating income
28,515

 
32,790


97,832


66,176

Depreciation and amortization
23,701

 
13,558

 
39,529

 
27,473

Real estate impairment loss
303

 
—

 
3,467

 
—

General and administrative expense
7,709

 
7,535

 
15,790

 
14,255

Transaction costs
132

 
34

 
183

 
84

NOI
60,360

 
53,917


156,801


107,988

    Less: non-cash revenue and expenses
(1,452
)
 
(1,454
)
 
(42,253
)
 
(3,265
)
Cash NOI(1)
58,908

 
52,463


114,548


104,723

Adjustments:
 
 
 
 
 
 
 
Cash NOI related to properties being redeveloped(1)
(5,414
)
 
(4,851
)
 
(10,868
)
 
(9,525
)
Cash NOI related to properties acquired, disposed, or in foreclosure(1)
(4,050
)
 
(477
)
 
(5,628
)
 
(970
)
Management and development fee income from non-owned properties
(351
)
 
(526
)
 
(830
)
 
(981
)
Tenant bankruptcy settlement income
(486
)
 
(340
)
 
(513
)
 
(1,490
)
Other(2)
20

 
36

 
12

 
84

    Subtotal adjustments
(10,281
)
 
(6,158
)

(17,827
)

(12,882
)
Same-property cash NOI
$
48,627

 
$
46,305


$
96,721


$
91,841

Adjustments:

 

 
 
 
 
Cash NOI related to properties being redeveloped
5,414

 
4,851


10,868


9,525

Same-property cash NOI including properties in redevelopment
$
54,041

 
$
51,156


$
107,589


$
101,366

(1) Cash NOI is calculated as total property revenues less property operating expenses, excluding the net effects of non-cash rental income and non-cash ground rent expense.
(2) Other adjustments include revenue and expense items attributable to non-same properties and corporate activities.





6

Reconciliation of Net Income to EBITDA and Adjusted EBITDA

The following table reflects the reconciliation of net income to EBITDA and Adjusted EBITDA for the three and six months ended June 30, 2017 and 2016. Net income is considered the most directly comparable GAAP measure. Refer to "Non-GAAP Financial Measures" on page 3 for a description of EBITDA and Adjusted EBITDA.
 
Three Months Ended June 30, 2017
 
Six Months Ended June 30, 2017
(Amounts in thousands)
2017
 
2016
 
2017
 
2016
Net income
$
14,920

 
$
36,071

 
$
69,655

 
$
55,859

Depreciation and amortization
23,701

 
13,558

 
39,529

 
27,473

Interest and debt expense
13,627

 
12,820

 
26,742

 
26,249

Income tax expense (benefit)
304

 
(306
)
 
624

 
30

EBITDA
52,552

 
62,143

 
136,550

 
109,611

Adjustments for Adjusted EBITDA:
 
 
 
 
 
 
 
Real estate impairment loss
303

 
—

 
3,467

 
—

Transaction costs
132

 
34

 
183

 
84

Loss on extinguishment of debt
—

 
—

 
1,274

 
—

Tenant bankruptcy settlement income
(486
)
 
(340
)
 
(513
)
 
(1,490
)
Gain on sale of real estate
—

 
(15,618
)
 
—

 
(15,618
)
Income from acquired leasehold interest
—

 
—

 
(39,215
)
 
—

Adjusted EBITDA
$
52,501

 
$
46,219


$
101,746


$
92,587

 
 
 
 
 
 
 
 

The following table reflects the Company's fully diluted common shares outstanding which is the total number of shares that would be outstanding assuming all possible conversions. Fully diluted common shares outstanding are utilized to calculate our equity market capitalization to allow investors the ability to assess our market value. The sum of the total equity market capitalization and total debt, as calculated in accordance with GAAP, represents the Company's total market capitalization.
 
June 30, 2017
Common shares outstanding
107,564,687

OP and LTIP units (dilutive)
12,830,232

Fully diluted common shares
120,394,919




7

ADDITIONAL INFORMATION
For a copy of the Company’s supplemental disclosure package, please access the "Investors" section of UE’s website at www.uedge.com. Our website also includes other financial information, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports.

ABOUT URBAN EDGE
Urban Edge Properties is a NYSE listed real estate investment trust focused on managing, acquiring, developing, and redeveloping retail real estate in urban communities, primarily in the New York metropolitan region. Urban Edge owns 90 properties totaling 16.6 million square feet of gross leasable area.

FORWARD-LOOKING STATEMENTS
Certain statements contained in this Press Release constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not guarantees of future performance. They represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Our future results, financial condition and business may differ materially from those expressed in these forward-looking statements. You can find many of these statements by looking for words such as “approximates,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “would,” “may” or other similar expressions in this Press Release. Many of the factors that will determine the outcome of these and our other forward-looking statements are beyond our ability to control or predict; these factors include, among others, the Company's ability to complete its active development, redevelopment and anchor repositioning projects, the Company's ability to pursue, finance and complete acquisition opportunities, the Company's ability to engage in the projects in its planned expansion and redevelopment pipeline and the Company's ability to achieve the estimated unleveraged returns for such projects and acquisitions. For further discussion of factors that could materially affect the outcome of our forward-looking statements, see “Risk Factors” in Part I, Item 1A, of our Annual Report on Form 10-K for the year ended December 31, 2016 and the other documents filed by the Company with the Securities and Exchange Commission.

For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date of this Press Release. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We do not undertake any obligation to release publicly any revisions to our forward-looking statements to reflect events or circumstances occurring after the date of this Press Release.


8


URBAN EDGE PROPERTIES
 
 
 
ADDITIONAL DISCLOSURES
 
 
 
As of June 30, 2017
 
 
 
 
 
 
 

Basis of Presentation
The information contained in the Supplemental Disclosure Package does not purport to disclose all items required by GAAP and is unaudited information. This Supplemental Disclosure Package should be read in conjunction with the Company's most recent Form 10-K and Form 10-Q. The results of operations of any property acquired are included in the Company's financial statements since the date of its acquisition, although such properties may be excluded from certain metrics disclosed in this Supplemental Disclosure Package.
Non-GAAP Financial Measures and Forward Looking Statements
For additional information regarding non-GAAP financial measures and forward looking statements, please see pages 3 and 8 of this Supplemental Disclosure Package.




9


URBAN EDGE PROPERTIES
 
 
SUMMARY FINANCIAL RESULTS AND RATIOS
 
 
For the three and six months ended June 30, 2017 (unaudited)
 
(in thousands, except per share, sf, rent psf and financial ratio data)
 
 
 
 
 
 
 
Three months ended
 
Six months ended
 
 
June 30, 2017
 
June 30, 2017
Summary Financial Results
 
 
 
 
Total revenue
 
$
89,501

 
$
215,565

General & administrative expenses (G&A)(10)
 
$
7,709

 
$
15,790

Adjusted EBITDA(7)
 
$
52,501

 
$
101,746

Net income attributable to common shareholders
 
$
13,583

 
$
64,169

Earnings per diluted share
 
$
0.13

 
$
0.63

Funds from operations (FFO)
 
$
38,664

 
$
112,131

FFO per diluted common share
 
$
0.34

 
$
1.01

FFO as Adjusted
 
$
38,310

 
$
73,860

FFO as Adjusted per diluted common share
 
$
0.33

 
$
0.66

Total dividends paid per share
 
$
0.22

 
$
0.44

Stock closing price low-high range (NYSE)
 
$23.44 to $27.65

 
$23.44 to $28.85

Weighted average diluted shares used in EPS computations(1)
 
104,260

 
111,224

Weighted average diluted common shares used in FFO computations(1)
 
114,433

 
111,224

 
 
 
 
 
Summary Property, Operating and Financial Data
 
 
 
 
# of Total properties / # of Retail properties
 
90 / 89

 
 
Gross leasable area (GLA) sf - retail portfolio(3)(5)
 
15,702,000

 
 
Weighted average annual rent psf - retail portfolio(3)(5)
 
$
17.25

 
 
Consolidated occupancy at end of period
 
95.7
 %
 
 
Consolidated retail portfolio occupancy at end of period(5)
 
95.9
 %
 
 
Same-property retail portfolio occupancy at end of period(5)(2)
 
98.2
 %
 
 
Same-property retail portfolio physical occupancy at end of period(4)(5)(2)
 
97.4
 %
 
 
Same-property cash NOI growth(2)
 
5.0
 %
 
5.3
 %
Same-property cash NOI growth, including redevelopment properties
 
5.6
 %
 
6.1
 %
Cash NOI margin - total portfolio
 
67.0
 %
 
66.2
 %
Expense recovery ratio - total portfolio
 
99.3
 %
 
98.4
 %
New, renewal and option rent spread - cash basis(8)
 
(2.7
)%
 
(1.8
)%
New, renewal and option rent spread - GAAP basis(9)
 
1.7
 %
 
2.8
 %
Net debt to total market capitalization(6)
 
27.4
 %
 
27.4
 %
Net debt to Adjusted EBITDA(6)
 
5.6
x
 
5.8
x
Adjusted EBITDA to interest expense(7)
 
4.0
x
 
4.0
x
Adjusted EBITDA to fixed charges(7)
 
3.0
x
 
3.0
x
 
 
 
 
 
(1) Weighted average diluted common shares used to calculate FFO per share and FFO as Adjusted per share for the periods presented include OP and LTIP Units, which are excluded from the calculation of earnings per diluted share for the quarter ended June 30, 2017, because their inclusion is anti-dilutive and included for the six months ended June 30, 2017, because their inclusion is dilutive. FFO includes earnings allocated to unit holders as the inclusion of these units is dilutive to FFO per share.
(2) The same-property pool for both cash NOI and occupancy includes retail properties the Company consolidated, owned and operated for the entirety of both periods being compared and excludes properties under development, redevelopment or that involve anchor repositioning where a substantial portion of the gross leasable area is taken out of service and excludes properties acquired, sold, under contract to be sold, or that are in the foreclosure process during the periods being compared.
(3) GLA - retail portfolio excludes 942,000 square feet of warehouses. Weighted average annual rent per square foot for our retail portfolio and warehouses was $16.57.
(4) Physical occupancy includes tenants that have access to their leased space and includes dark and paying tenants.
(5) Our retail portfolio includes shopping centers and malls and excludes warehouses.
(6) See computation on page 16.
(7) See computation on page 14.
(8) Rents have not been calculated on a straight-line basis. Previous/expiring rent is that as of time of expiration and includes any percentage rent paid as well. New rent is that which is paid at commencement.
(9) Rents are calculated on a straight-line ("GAAP") basis. See computation on page 19.
(10) Includes $40 thousand and $0.5 million of severance expense incurred in the three and six months ended June 30, 2017, respectively.


10


URBAN EDGE PROPERTIES
 
 
CONSOLIDATED BALANCE SHEETS
 
 
As of June 30, 2017 (unaudited) and December 31, 2016
 
 
(in thousands, except share and per share amounts)
 
 
 
 
 
 
June 30,
 
December 31,
 
2017
 
2016
ASSETS
 
 
 

Real estate, at cost:
 

 
 

Land
$
522,098

 
$
384,217

Buildings and improvements
1,992,386

 
1,650,054

Construction in progress
123,009

 
99,236

Furniture, fixtures and equipment
5,591

 
4,993

Total
2,643,084

 
2,138,500

Accumulated depreciation and amortization
(568,980
)
 
(541,077
)
Real estate, net
2,074,104

 
1,597,423

Cash and cash equivalents
248,407

 
131,654

Restricted cash
14,422

 
8,532

Tenant and other receivables, net of allowance for doubtful accounts of $2,947 and $2,332, respectively
13,299

 
9,340

Receivable arising from the straight-lining of rents, net of allowance for doubtful accounts of $324 and $261, respectively
85,737

 
87,695

Identified intangible assets, net of accumulated amortization of $26,140 and $22,361, respectively
94,964

 
30,875

Deferred leasing costs, net of accumulated amortization of $14,910 and $13,909, respectively
19,771

 
19,241

Deferred financing costs, net of accumulated amortization of $1,228 and $726, respectively
3,755

 
1,936

Prepaid expenses and other assets
9,245

 
17,442

Total assets
$
2,563,704

 
$
1,904,138

 
 
 
 
LIABILITIES AND EQUITY
 

 
 

Liabilities:
 
 
 
Mortgages payable, net
$
1,412,397

 
$
1,197,513

Identified intangible liabilities, net of accumulated amortization of $60,937 and $72,528, respectively
187,223

 
146,991

Accounts payable and accrued expenses
63,388

 
48,842

Other liabilities
16,627

 
14,675

Total liabilities
1,679,635

 
1,408,021

Commitments and contingencies
 
 
 
Shareholders’ equity:
 
 
 
Common shares: $0.01 par value; 500,000,000 shares authorized and 107,564,687 and 99,754,900 shares issued and outstanding, respectively
1,075

 
997

Additional paid-in capital
683,889

 
488,375

Accumulated deficit
(10,479
)
 
(29,066
)
Noncontrolling interests:
 
 
 
Redeemable noncontrolling interests
209,202

 
35,451

Noncontrolling interest in consolidated subsidiaries
382

 
360

Total equity
884,069

 
496,117

Total liabilities and equity
$
2,563,704

 
$
1,904,138


11


URBAN EDGE PROPERTIES
 
 
CONSOLIDATED STATEMENTS OF INCOME
 
 
For the three and six months ended June 30, 2017 and 2016 (unaudited)
 
(in thousands, except share and per share amounts)
 
 
 
 
 

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
REVENUE
 
 
 
 
 
 
 
Property rentals
$
64,708

 
$
58,683

 
$
127,206

 
$
117,612

Tenant expense reimbursements
23,881

 
19,879

 
47,652

 
42,386

Income from acquired leasehold interest
—

 
—

 
39,215

 
—

Management and development fees
351

 
526

 
830

 
981

Other income
561

 
369

 
662

 
1,546

Total revenue
89,501

 
79,457

 
215,565

 
162,525

EXPENSES
 
 
 
 
 
 
 
Depreciation and amortization
23,701

 
13,558

 
39,529

 
27,473

Real estate taxes
14,711

 
12,723

 
28,103

 
25,972

Property operating
11,088

 
9,840

 
24,456

 
22,699

General and administrative
7,709

 
7,535

 
15,790

 
14,255

Real estate impairment loss
303

 
—

 
3,467

 
—

Ground rent
2,436

 
2,483

 
5,106

 
5,021

Transaction costs
132

 
34

 
183

 
84

Provision for doubtful accounts
906

 
494

 
1,099

 
845

Total expenses
60,986

 
46,667

 
117,733

 
96,349

Operating income
28,515

 
32,790

 
97,832

 
66,176

Gain on sale of real estate
—

 
15,618

 
—

 
15,618

Interest income
336

 
177

 
463

 
344

Interest and debt expense
(13,627
)
 
(12,820
)
 
(26,742
)
 
(26,249
)
Loss on extinguishment of debt
—

 
—

 
(1,274
)
 
—

Income before income taxes
15,224

 
35,765

 
70,279

 
55,889

Income tax benefit (expense)
(304
)
 
306

 
(624
)
 
(30
)
Net income
14,920

 
36,071

 
69,655

 
55,859

Less (net income) loss attributable to noncontrolling interests in:
 
 
 
 
 
 
 
Operating partnership
(1,326
)
 
(2,201
)
 
(5,464
)
 
(3,355
)
Consolidated subsidiaries
(11
)
 
(2
)
 
(22
)
 
2

Net income attributable to common shareholders
$
13,583

 
$
33,868

 
$
64,169

 
$
52,506

 
 
 
 
 
 
 
 
Earnings per common share - Basic:
$
0.13

 
$
0.34

 
$
0.63

 
$
0.53

Earnings per common share - Diluted:
$
0.13

 
$
0.34

 
$
0.63

 
$
0.53

Weighted average shares outstanding - Basic
104,063

 
99,274

 
101,863

 
99,270

Weighted average shares outstanding - Diluted
104,260

 
99,668

 
111,224

 
99,592



12


URBAN EDGE PROPERTIES
 
 
SUPPLEMENTAL SCHEDULE OF NET OPERATING INCOME
 
 
For the three and six months ended June 30, 2017 and 2016
 
(in thousands)
 
 
 
 
 
 
Three Months Ended
June 30,
 
Percent Change
 
Six Months Ended
June 30,
 
Percent Change
 
2017
 
2016
 
 
2017
 
2016
 
Total cash NOI(1)
 
 
 
 
 
 
 
 
 
 
 
Total revenue
$87,326
 
$76,968
 
13.5%
 
$171,676
 
$157,379
 
9.1%
Total property operating expenses
(28,843)
 
(25,061)
 
15.1%
 
(58,107)
 
(53,693)
 
8.2%
Cash NOI - total portfolio
$
58,483

 
$
51,907

 
12.7%
 
$
113,569

 
$
103,686

 
9.5%
 
 
 
 
 
 
 
 
 
 
 
 
NOI margin (NOI / Total revenue)
67.0
%
 
67.4
%
 
 
 
66.2
%
 
65.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-property cash NOI(2)
 
 
 
 
 
 
 
 
 
 
 
Property rentals
$
52,192

 
$
50,664

 
 
 
$
104,067

 
$
101,038

 
 
Tenant expense reimbursements
20,562

 
17,966

 
 
 
41,948

 
38,442

 
 
Percentage rent
31

 
48

 
 
 
416

 
307

 
 
Total revenue
72,785

 
68,678

 
6.0%
 
146,431

 
139,787

 
4.8%
Real estate taxes
(12,670
)
 
(11,759
)
 
 
 
(24,755
)
 
(23,889
)
 
 
Property operating
(8,568
)
 
(8,251
)
 
 
 
(19,703
)
 
(19,212
)
 
 
Ground rent
(2,253
)
 
(2,193
)
 
 
 
(4,500
)
 
(4,399
)
 
 
Provision for doubtful accounts
(667
)
 
(170
)
 
 
 
(752
)
 
(446
)
 
 
Total property operating expenses
(24,158
)
 
(22,373
)
 
8.0%
 
(49,710
)
 
(47,946
)
 
3.7%
Same-property cash NOI(3)
$
48,627

 
$
46,305

 
5.0%
 
$
96,721

 
$
91,841

 
5.3%
 
 
 
 
 
 
 
 
 
 
 
 
Cash NOI related to properties being redeveloped
$
5,414

 
$
4,851

 
 
 
$
10,868

 
$
9,525

 
 
Same-property cash NOI including properties in redevelopment
$
54,041

 
$
51,156

 
5.6%
 
$
107,589

 
$
101,366

 
6.1%
 
 
 
 
 
 
 
 
 
 
 
 
Same-property physical occupancy(3)
97.4
%
 
96.4
%
 
 
 
 
 
 
 
 
Same-property leased occupancy(3)
98.2
%
 
97.3
%
 
 
 
 
 
 
 
 
Number of properties included in same-property analysis
76

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Total revenue includes cash received from tenant bankruptcy settlements and lease termination fees and excludes management and development fee income and non-cash amounts. Property operating expense amounts have been adjusted to exclude non-cash amounts.
(2) Excludes management and development fee income, lease termination fees, bankruptcy settlement income, non-cash rental income and ground rent expense and income or expenses that we do not believe are representative of ongoing operating results, if any.
(3) The same-property pool for both NOI and occupancy includes retail properties the Company consolidated, owned and operated for the entirety of both periods being compared and excludes properties under development, redevelopment or that involve anchor repositioning where a substantial portion of the gross leasable area is taken out of service and properties acquired, sold, under contract to be sold, or are in the foreclosure process during the periods being compared. Same-property occupancy includes dark and paying tenants.


13


URBAN EDGE PROPERTIES
 
 
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION and AMORTIZATION (EBITDA)
For the three and six months ended June 30, 2017 and 2016
 
(in thousands)
 
 
 
 
 

 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2017
 
2016
 
2017
 
2016
Net income
$
14,920

 
$
36,071

 
$
69,655

 
$
55,859

Depreciation and amortization
23,701

 
13,558

 
39,529

 
27,473

Interest expense
13,040

 
12,097

 
25,291

 
24,867

Amortization of deferred financing costs
587

 
723

 
1,451

 
1,382

Income tax expense (benefit)
304

 
(306
)
 
624

 
30

EBITDA
52,552

 
62,143


136,550


109,611

Adjustments for Adjusted EBITDA:
 
 
 
 
 
 
 
Real estate impairment loss
303

 
—

 
3,467

 
—

Transaction costs
132

 
34

 
183

 
84

Loss on extinguishment of debt
—

 
—

 
1,274

 
—

Tenant bankruptcy settlement income
(486
)
 
(340
)
 
(513
)
 
(1,490
)
Gain on sale of real estate
—

 
(15,618
)
 
—

 
(15,618
)
Income from acquired leasehold interest
—

 
—

 
(39,215
)
 
—

Adjusted EBITDA
$
52,501

 
$
46,219


$
101,746


$
92,587

 
 
 
 
 
 
 
 
Interest expense
$
13,040

 
$
12,097


$
25,291


$
24,867

 
 
 
 
 
 
 
 
Adjusted EBITDA to interest expense
4.0
x
 
3.8
x

4.0
x

3.7
x
 
 
 
 
 
 
 
 
Fixed charges
 
 
 
 
 
 
 
Interest expense
$
13,040

 
$
12,097


$
25,291


$
24,867

Scheduled principal amortization
4,427

 
4,325

 
9,063

 
8,455

Total fixed charges
$
17,467

 
$
16,422


$
34,354


$
33,322

 
 
 
 
 
 
 
 
Adjusted EBITDA to fixed charges
3.0
x
 
2.8
x

3.0
x

2.8
x
 
 
 
 
 
 
 
 



14


URBAN EDGE PROPERTIES
 
 
FUNDS FROM OPERATIONS
 
For the three and six months ended June 30, 2017 and 2016
 
(in thousands, except per share amounts)
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
2017
 
2016
 
2017
 
2016
Net income
$
14,920

 
$
36,071

 
$
69,655

 
$
55,859

Less (net income) attributable to noncontrolling interests in:
 
 
 
 
 
 
 
Operating partnership
(1,326
)
 
(2,201
)
 
(5,464
)
 
(3,355
)
Consolidated subsidiaries
(11
)
 
(2
)
 
(22
)
 
2

Net income attributable to common shareholders
13,583

 
33,868


64,169


52,506

Adjustments:
 
 
 
 
 
 
 
Gain on sale of real estate
—

 
(15,618
)
 
—

 
(15,618
)
Rental property depreciation and amortization
23,452

 
13,395

 
39,031

 
27,150

Real estate impairment loss
303

 
—

 
3,467

 
—

Limited partnership interests in operating partnership(1)
1,326

 
2,201

 
5,464

 
3,355

FFO Applicable to diluted common shareholders
38,664

 
33,846


112,131


67,393

FFO per diluted common share(2)
0.34

 
0.32


1.01


0.64

Adjustments to FFO:
 
 
 
 
 
 
 
Transaction costs
132

 
34

 
183

 
84

Loss on extinguishment of debt

—

 
—

 
1,274

 
—

Tenant bankruptcy settlement income

(486
)
 
(340
)
 
(513
)
 
(1,490
)
Benefit related to income taxes
—

 
(625
)
 
—

 
(625
)
Income from acquired leasehold interest
—

 
—

 
(39,215
)
 
—

FFO as Adjusted applicable to diluted common shareholders

$
38,310

 
$
32,915


$
73,860


$
65,362

FFO as Adjusted per diluted common share(2)
$
0.33

 
$
0.31


$
0.66


$
0.62

 
 
 
 
 
 
 
 
Weighted Average diluted common shares(2)
114,433

 
106,041

 
111,224

 
105,866

(1) Represents earnings allocated to LTIP and OP unit holders for unissued common shares which have been excluded for purposes of calculating earnings per diluted share for the three months ended June 30, 2017. FFO applicable to diluted common shareholders and FFO as Adjusted applicable to diluted common shareholders calculations includes earnings allocated to LTIP and OP unit holders and the respective weighted average share totals include the redeemable shares outstanding as their inclusion is dilutive.
(2) Weighted average diluted shares used to calculate FFO per share and FFO as Adjusted per share for the three months ended June 30, 2017 and the three and six months ended June 30, 2016 are higher than the GAAP weighted average diluted shares as a result of the dilutive impact of LTIP and OP units which may be redeemed for our common stock. These redeemable units are not included in the weighted average diluted share count for GAAP purposes because their inclusion is anti-dilutive. LTIP and OP units are included for the six months ended June 30, 2017 as their inclusion is dilutive.






15


URBAN EDGE PROPERTIES
 
 
MARKET CAPITALIZATION, DEBT RATIOS AND LIQUIDITY
 
 
As of June 30, 2017
 
 
(in thousands, except share amounts)
 
 
 
 
 

 
June 30, 2017
Closing market price of common shares
$
23.73

 
 
Basic common shares
107,564,687

OP and LTIP units
12,830,232

Diluted common shares
120,394,919

 
 
Equity market capitalization
$
2,856,971

 
 
 
 
Total consolidated debt(1)
$
1,420,605

Cash and cash equivalents
(248,407
)
Net debt
$
1,172,198

 
 
Net Debt to Adjusted EBITDA
5.6
x
 
 
Total consolidated debt(1)
$
1,420,605

Equity market capitalization
2,856,971

Total market capitalization
$
4,277,576

 
 
Net debt to total market capitalization at applicable market price
27.4
%
 
 
 
 
Cash and cash equivalents including restricted cash
$
262,829

Available under unsecured credit facility
600,000

Total liquidity
$
862,829

 
 
(1) Total consolidated debt excludes unamortized debt issuance costs of $8.2 million.


16


URBAN EDGE PROPERTIES
 
 
ADDITIONAL DISCLOSURES
 
(in thousands)
 
 
 
 
 
 
 
Three Months Ended
June 30,
 
Six Months Ended
June 30,
 
 
2017
 
2016
 
2017
 
2016
Certain non-cash items:
 
 
 

 
 
 
 
Straight-line rental income(1)
 
$
(323
)
 
$
60

 
$
(413
)
 
$
361

Amortization of below-market lease intangibles, net(1)
 
2,071

 
1,874


4,107

 
3,749

Straight-line ground rent expense(2)
 
(53
)
 
(47
)
 
(107
)
 
(135
)
Amortization of below-market lease intangibles, lessee(2)
 
(126
)
 
(243
)
 
(486
)
 
(486
)
Amortization of deferred financing costs(4)
 
(587
)
 
(723
)
 
(1,451
)
 
(1,382
)
Capitalized interest
 
1,006

 
1,113

 
1,946

 
1,631

Share-based compensation expense(3)
 
(1,875
)
 
(1,424
)
 
(3,359
)
 
(2,721
)
 
 
 
 
 
 
 
 
 
Capital expenditures: (5)
 
 
 
 
 
 
 
 
Development and redevelopment costs
 
$
16,010

 
$
11,360

 
$
25,258

 
$
22,272

Maintenance capital expenditures
 
655

 
2,587

 
1,311

 
3,147

Leasing commissions
 
426

 
443

 
626

 
1,008

Tenant improvements and allowances
 
1,545

 
570

 
2,791

 
2,127

Total capital expenditures
 
$
18,636

 
$
14,960


$
29,986


$
28,554

 
 
 
 
 
 
 
 
 
 
 
June 30, 2017
 
December 31, 2016
 
 
 
 
Other Liabilities:
 
 
 
 
 
 
 
 
Deferred ground rent expense
 
$
6,392

 
$
6,284

 
 
 
 
Deferred tax liability, net
 
3,859

 
3,802

 
 
 
 
Other
 
6,376

 
4,589

 
 
 
 
Total other liabilities
 
$
16,627

 
$
14,675

 
 
 
 
 
 
 
 
 
 
 
 
 
Accounts payable and accrued expenses:
 
 
 
 
 
 
 
 
Tenant prepaid/deferred revenue
 
$
16,955

 
$
13,619

 
 
 
 
Accrued capital expenditures and leasing costs
 
19,415

 
13,850

 
 
 
 
Accrued interest payable
 
7,909

 
6,635

 
 
 
 
Security deposits
 
5,521

 
4,287

 
 
 
 
Accrued taxes payable
 
2,720

 
1,698

 
 
 
 
Other
 
10,868

 
8,753

 
 
 
 
Total accounts payable and accrued expenses
 
$
63,388

 
$
48,842

 
 
 
 
(1) Amounts included in the financial statement line item "Property rentals" in the consolidated statements of income.
(2) Amounts included in the financial statement line item "Ground rent" in the consolidated statements of income.
(3) Amounts included in the financial statement line item "General and administrative" in the consolidated statements of income.
(4) Amounts included in the financial statement line item "Interest and debt expense" in the consolidated statements of income.
(5) Amounts presented on a cash basis.


17


URBAN EDGE PROPERTIES
 
 
TENANT CONCENTRATION - TOP TWENTY-FIVE TENANTS
 
As of June 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tenant
Number of stores
Square feet
% of total square feet
Annualized base rent
% of total annualized base rent
Weighted average annual rent per square foot
Average remaining term of ABR(1)
The Home Depot, Inc.
7

920,226

5.8%
$
15,801,538

6.1%
$
17.17

14.0
Wal-Mart Stores, Inc.
9

1,438,730

9.1%
10,726,552

4.2%
7.46

8.5
The TJX Companies, Inc.(2)
17

607,105

3.9%
10,069,246

3.9%
16.59

4.4
Best Buy Co., Inc.
9

400,578

2.5%
9,336,325

3.6%
23.31

6.9
Lowe's Companies, Inc.
6

976,415

6.2%
8,575,004

3.3%
8.78

10.2
Ahold Delhaize(3)
9

655,618

4.2%
8,015,607

3.1%
12.23

6.3
Kohl's Corporation
8

716,345

4.5%
6,873,766

2.7%
9.60

5.9
PetSmart, Inc.
12

287,493

1.8%
6,740,340

2.6%
23.45

4.3
BJ's Wholesale Club
4

454,297

2.9%
5,278,625

2.0%
11.62

9.4
Sears Holdings Corporation(4)
4

547,443

3.5%
5,244,737

2.0%
9.58

18.4
Toys "R" Us, Inc.(5)
9

398,391

2.5%
4,994,856

1.9%
12.54

5.3
ShopRite
4

265,997

1.7%
4,236,388

1.6%
15.93

11.9
Staples, Inc.
9

186,030

1.2%
3,922,796

1.5%
21.09

3.4
The Gap, Inc.(6)
8

123,784

0.8%
3,498,295

1.4%
28.26

4.1
Target Corporation
2

297,856

1.9%
3,448,666

1.3%
11.58

14.8
Century 21
1

156,649

1.0%
3,394,181

1.3%
21.67

9.6
Whole Foods Market, Inc.
2

100,682

0.6%
3,365,570

1.3%
33.43

10.5
Dick's Sporting Goods, Inc.(7)
4

167,786

1.1%
3,356,429

1.3%
20.00

1.5
LA Fitness International LLC
4

181,342

1.2%
3,165,032

1.2%
17.45

10.0
24 Hour Fitness
1

53,750

0.3%
2,564,520

1.0%
47.71

14.5
National Wholesale Liquidator
1

171,216

1.1%
2,204,219

0.9%
12.87

5.6
URBN(8)
1

31,450

0.2%
2,201,500

0.9%
70.00

11.3
Burlington Stores, Inc.
4

369,181

2.3%
2,189,728

0.8%
5.93

8.9
Bed Bath & Beyond Inc.(9)
5

149,879

1.0%
1,996,934

0.8%
13.32

5.4
Mattress Firm, Inc.
12

71,222

0.5%
1,988,814

0.8%
27.92

4.4
 
 
 
 
 
 
 
 
Total/Weighted Average
152

9,729,465

61.8%
$
133,189,668

51.5%
$
13.69

8.6
 
 
 
 
 
 
 
 
(1) In years, excluding tenant renewal options. Total top twenty-five tenants is weighted based on annualized base rent ("ABR").
(2) Includes Marshalls (11), T.J. Maxx (4) and HomeGoods (2).
(3) Includes Stop & Shop (6) and Giant Food (3).
(4) Includes Kmart (4).
(5) Includes Toys "R" Us (6) and Babies "R" Us (3).
(6) Includes Old Navy (5), Gap (2) and Banana Republic (1).
(7) Includes Dick's Sporting Goods (3) and Golf Galaxy (1).
(8) Includes Anthropologie (1).
(9) Includes Harmon Face Values (3) and Bed Bath & Beyond (2).


Note: Amounts shown in the table above include all retail properties, including those in redevelopment, on a cash basis other than tenants in a free rent period which are shown at their initial cash rent.

18


URBAN EDGE PROPERTIES
 
 
LEASING ACTIVITY
 
For the three and six months ended June 30, 2017
 
 
 
 
 
 
 
 
Three months ended
June 30, 2017
 
Six months ended
June 30, 2017
 
GAAP(3)
 
Cash(2)
 
GAAP(3)
 
Cash(2)
New leases
 
 
 
 
 
 
 
Number of new leases executed
12

 
12

 
17

 
17

Total square feet
51,732

 
51,732

 
90,748

 
90,748

Number of same space leases(1)
5

 
5

 
10

 
10

Same space square feet
16,735

 
16,735

 
55,751

 
55,751

Prior rent per square foot
$
29.70

 
$
29.76

 
$
20.34

 
$
20.48

New rent per square foot
$
27.58

 
$
24.41

 
$
20.03

 
$
18.27

Same space weighted average lease term (years)
14.1

 
14.1

 
11.3

 
11.3

Same space TIs per square foot(4)
N/A

 
$
11.79

 
N/A

 
$
10.66

Rent spread(5)
(7.1
)%
 
(18.0
)%
 
(1.5
)%
 
(10.8
)%
 
 
 
 
 
 
 
 
Renewals & Options
 
 
 
 
 
 
 
Number of new leases executed
19

 
19

 
31

 
31

Total square feet
321,001

 
321,001

 
376,364

 
376,364

Number of same space leases(1)
19

 
19

 
31

 
31

Same space square feet
321,001

 
321,001

 
376,364

 
376,364

Prior rent per square foot
$
15.61

 
$
15.59

 
$
15.70

 
$
16.05

New rent per square foot
$
15.21

 
$
15.40

 
$
16.26

 
$
16.04

Same space weighted average lease term (years)
6.5

 
6.5

 
6.3

 
6.3

Same space TIs per square foot(4)
N/A

 
$
—

 
N/A

 
$
—

Rent spread
(2.6
)%
 
(1.2
)%
 
3.6
 %
 
(0.1
)%
 
 
 
 
 
 
 
 
Total New Leases and Renewals & Options
 
 
 
 
 
 
 
Number of new leases executed
31

 
31

 
48

 
48

Total square feet
372,733

 
372,733

 
467,112

 
467,112

Number of same space leases(1)
24

 
24

 
41

 
41

Same space square feet
337,736

 
337,736

 
432,115

 
432,115

Prior rent per square foot
$
15.93

 
$
16.29

 
$
16.30

 
$
16.62

New rent per square foot
$
16.20

 
$
15.85

 
$
16.75

 
$
16.33

Same space weighted average lease term (years)
6.9

 
6.9

 
6.9

 
6.9

Same space TIs per square foot(4)
N/A

 
$
0.58

 
N/A

 
$
1.38

Rent spread(5)
1.7
 %
 
(2.7
)%
 
2.8
 %
 
(1.8
)%
(1) Leases executed on a same space basis include leases with comparable sf and prior existing tenants.
(2) Rents have not been calculated on a straight-line basis. Previous/expiring rent is that as of time of expiration and includes any percentage rent paid as well. New rent is that which is paid at commencement.
(3) Rents are calculated on a straight-line ("GAAP") basis.
(4) Includes both tenant improvements and landlord contributions.
(5) Rent spreads include all same space leases executed during the period regardless of how long a space was vacant. The cash rent spreads on new leases for the three and six months ended June 30, 2017 were 21.9% and 28.7%, respectively, if spaces vacant for more than two years are excluded. The total cash rent spreads on new leases including renewals and options for the three and six months ended June 30, 2017 were (1.0%) and 0.9%, respectively, if spaces vacant for more than two years are excluded.

19


URBAN EDGE PROPERTIES
 
 
RETAIL PORTFOLIO LEASE EXPIRATION SCHEDULE
 
As of June 30, 2017
 
 
 
 
 
 
 
 
 
ANCHOR TENANTS (SF>=10,000)
SHOP TENANTS (SF<10,000)
TOTAL TENANTS
Year(1)
# of leases
Square Feet
% of Total SF
Weighted Avg Annual Base Rent PSF(2)
# of leases
Square Feet
% of Total SF
Weighted Avg Annual Base Rent PSF(2)
# of leases
Square Feet
% of Total SF
Weighted Avg Annual Base Rent PSF(2)
 
 
 
 
 
 
 
 
 
 
 
 
 
M-T-M
1

40,000

0.3
%
$
17.05

21

53,000

2.2%
$
31.77

22

93,000

0.6
%
$
25.44

2017
2

36,000

0.3
%
15.87

37

112,000

4.7%
31.31

39

148,000

0.9
%
27.56

2018
16

841,000

6.3
%
9.28

71

202,000

8.6%
39.45

87

1,043,000

6.6
%
15.12

2019
31

1,060,000

7.9
%
17.85

93

287,000

12.1%
37.10

124

1,347,000

8.6
%
21.95

2020
33

1,163,000

8.7
%
15.21

67

224,000

9.5%
36.81

100

1,387,000

8.8
%
18.69

2021
30

878,000

6.6
%
19.05

66

206,000

8.7%
35.90

96

1,084,000

6.9
%
22.26

2022
28

1,314,000

9.9
%
11.19

67

192,000

8.1%
31.79

95

1,506,000

9.6
%
13.82

2023
29

1,244,000

9.3
%
17.20

35

115,000

4.9%
35.48

64

1,359,000

8.7
%
18.75

2024
25

1,267,000

9.5
%
12.54

38

131,000

5.5%
28.41

63

1,398,000

8.9
%
14.03

2025
9

502,000

3.8
%
13.61

35

106,000

4.5%
35.71

44

608,000

3.9
%
17.46

2026
7

496,000

3.7
%
8.66

49

163,000

6.9%
30.11

56

659,000

4.2
%
13.96

2027
16

631,000

4.7
%
15.38

34

160,000

6.8%
39.11

50

791,000

5.0
%
20.18

Thereafter
48

3,500,000

26.2
%
14.57

24

134,000

5.7%
37.78

72

3,634,000

23.2
%
15.42

Subtotal/Average
275

12,972,000

97.2
%
$
14.36

637
2,085,000

88.2
%
$
35.19

912
15,057,000

95.9
%
$
17.24

Vacant
14

367,000

2.8
%
 N/A

102

278,000

11.8
%
 N/A

116

645,000

4.1
%
 N/A
Total/Average
289

13,339,000

100
%
 N/A

739
2,363,000

100
%
 N/A

1,028
15,702,000

100
%
 N/A
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Year of expiration excludes tenant renewal options.
(2) Weighted average annual rent per square foot is calculated by annualizing tenant's in-place contractual (cash-basis) rent, including ground rent, and excludes tenant reimbursements and concessions and storage rent.


Note: Amounts shown in table above include both current leases and signed leases that have not commenced on vacant spaces for all retail properties (including properties in redevelopment). The average base rent for our 942,000 square-foot warehouse property (excluded from the table above) is $5.73 per square foot as of June 30, 2017.


20


URBAN EDGE PROPERTIES
 
 
RETAIL PORTFOLIO LEASE EXPIRATION SCHEDULE ASSUMING EXERCISE OF ALL RENEWALS AND OPTIONS
As of June 30, 2017
 
 
 
 
 
 
 
 
 
ANCHOR TENANTS (SF>=10,000)
SHOP TENANTS (SF<10,000)
TOTAL TENANTS
Year(1)
# of leases
Square Feet
% of Total SF
Weighted Avg Annual Base Rent PSF(2)
# of leases
Square Feet
% of Total SF
Weighted Avg Annual Base Rent PSF(2)
# of leases
Square Feet
% of Total SF
Weighted Avg Annual Base Rent PSF(2)
 
 
 
 
 
 
 
 
 
 
 
 
 
M-T-M
1

40,000

0.3
%
$
17.05

21

53,000

2.2%
$
31.77

22

93,000

0.6
%
$
25.44

2017
2

36,000

0.3
%
15.87

28

79,000

3.4%
32.88

30

115,000

0.7
%
27.55

2018
2

28,000

0.2
%
11.33

54

147,000

6.2%
45.72

56

175,000

1.1
%
40.22

2019
4

165,000

1.2
%
12.28

57

150,000

6.4%
45.21

61

315,000

2.0
%
27.96

2020
6

104,000

0.8
%
22.31

50

146,000

6.2%
44.25

56

250,000

1.6
%
35.12

2021
6

121,000

0.9
%
18.20

46

120,000

5.1%
37.49

52

241,000

1.5
%
27.81

2022
5

164,000

1.2
%
9.67

42

119,000

5.0%
36.74

47

283,000

1.8
%
21.05

2023
9

410,000

3.1
%
16.78

28

83,000

3.5%
36.60

37

493,000

3.1
%
20.12

2024
11

215,000

1.6
%
17.58

48

141,000

6.0%
36.12

59

356,000

2.3
%
24.92

2025
11

361,000

2.7
%
19.58

32

106,000

4.5%
34.96

43

467,000

3.0
%
23.07

2026
8

216,000

1.6
%
19.07

45

130,000

5.5%
34.32

53

346,000

2.2
%
24.80

2027
7

287,000

2.2
%
17.24

34

97,000

4.1%
33.12

41

384,000

2.5
%
21.25

Thereafter
203

10,825,000

81.1
%
19.96

152

714,000

30.1%
43.81

355

11,539,000

73.5
%
21.43

Subtotal/Average
275

12,972,000

97.2
%
$
19.47

637

2,085,000

88.2%
$
40.20

912

15,057,000

95.9
%
$
22.34

Vacant
14

367,000

2.8
%
 N/A

102

278,000

11.8%
 N/A

116

645,000

4.1
%
 N/A

Total/Average
289

13,339,000

100
%
 N/A

739

2,363,000

100%
 N/A

1,028

15,702,000

100
%
 N/A

 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Year of expiration includes tenant renewal options.
(2) Weighted average annual rent per square foot is calculated by annualizing tenant's in-place contractual (cash-basis) rent, including ground rent, and excludes tenant reimbursements and concessions and storage rent and is adjusted for assumed exercised options using option rents specified in the underlying leases. Weighted average annual base rent for leases whose future option rent is based on fair market value or CPI is reported at the last stated option rent in the respective lease.

Note: Amounts shown in table above includes both current leases and signed leases that have not commenced on vacant spaces for all retail properties (including properties in redevelopment). The average base rent for our 942,000 square-foot warehouse property assuming exercise of all options at future tenant rent (excluded from the table above) is $5.89 per square foot as of June 30, 2017.


21
        
                                        

URBAN EDGE PROPERTIES
 
 
PROPERTY STATUS REPORT
As of June 30, 2017
 
 
(dollars in thousands, except per sf amounts)
 
 
 
 
 


Property
Total Square Feet (1)
Percent Leased(1)
Weighted Average Annual Rent per sq ft (2)
Mortgage Debt(7)
 
Major Tenants
 
 
 
 
 
 
 
SHOPPING CENTERS AND MALLS:
 
 
 
California:
 
 
 
 
 
 
Signal Hill
45,000

100.0%
$26.49
—
 
Best Buy
Vallejo (leased through 2043)(8)
45,000

100.0%
19.26
—
 
Best Buy
Walnut Creek (1149 South Main Street)(6)
31,000

100.0%
70.00
—
 
Anthropologie
Walnut Creek (Mt. Diablo) (4)
7,000

100.0%
115.00
—
 
Z Gallerie
Connecticut:
 
 
 
 
 
 
Newington
189,000

100.0%
9.83
$10,172
(3) 
Walmart, Staples
Maryland:
 
 
 
 
 
 
Baltimore (Towson)(6)
155,000

100.0%
24.91
$14,141

(3) 
Staples, Home Goods, Golf Galaxy, Tuesday Morning, Ulta, Kirkland's, Five Below (last 4 leases not commenced)
Glen Burnie
121,000

100.0%
10.05
—
 
Gavigan's Home Furnishings, Pep Boys
Rockville
94,000

98.1%
24.66
—
 
Regal Cinemas
Wheaton (leased through 2060)(8)
66,000

100.0%
16.36
—
 
Best Buy
Massachusetts:
 
 
 
 
 
 
Cambridge (leased through 2033)(8)
48,000

100.0%
23.44
—
 
PetSmart, Modell’s Sporting Goods
Chicopee
224,000

100.0%
5.50
$7,517
(3) 
Walmart
Milford (leased through 2019)(8)
83,000

100.0%
9.01
—
 
Kohl’s
Springfield
182,000

100.0%
5.68
$5,185
(3) 
Walmart
Missouri:
 
 
 
 
 
 
Manchester(6)
131,000

88.8%
11.53
$12,500
 
Academy Sports, Bob's Discount Furniture, Pan-Asia Market
New Hampshire:
 
 
 
 
 
 
Salem (leased through 2102)(8)
37,000

100.0%
12.58
—
 
Babies “R” Us
New Jersey:
 
 
 
 
 
 
Bergen Town Center - East, Paramus
212,000

97.0%
19.41
—
 
Lowe's, REI, Kirkland's
Bergen Town Center - West, Paramus
955,000

99.3%
32.30
$300,000
 
Target, Century 21, Whole Foods Market, Marshalls, Nordstrom Rack, Saks Off 5th, HomeGoods, H&M, Bloomingdale's Outlet, Nike Factory Store, Old Navy, Nieman Marcus Last Call Studio
Brick
278,000

100.0%
18.88
$28,928
(3) 
Kohl's, ShopRite, Marshalls, Kirkland's
Carlstadt (leased through 2050)(8)
78,000

100.0%
23.66
—
 
Stop & Shop
Cherry Hill (Cherry Hill Commons)
261,000

99.2%
9.64
$12,554
(3) 
Walmart, Toys “R” Us, Maxx Fitness
Cherry Hill (Plaza at Cherry Hill)(6)
413,000

74.0%
13.03
$28,930
 
LA Fitness, Aldi, Raymour & Flanigan, Restoration Hardware, Total Wine, Guitar Center, Sam Ash Music
East Brunswick
427,000

100.0%
14.93
$33,195
(3) 
Lowe’s, Kohl’s, Dick’s Sporting Goods, P.C. Richard & Son, T.J. Maxx, LA Fitness
East Hanover (200 - 240 Route 10 West)
343,000

96.1%
20.22
$34,634
(3) 
The Home Depot, Dick's Sporting Goods, Saks Off Fifth (lease not commenced), Marshalls, Burlington, Forever21 Red
East Hanover (280 Route 10 West)
28,000

100.0%
34.71
$4,118
(3) 
REI
East Rutherford (leased through 2194)(8)
197,000

98.3%
12.45
$12,305
(3) 
Lowe’s
Englewood(6)
41,000

64.1%
20.83
$11,537
 
New York Sports Club
Garfield
263,000

100.0%
13.70
—
 
Walmart, Burlington, Marshalls, PetSmart, Ulta (lease not commenced)
Hackensack
275,000

97.9%
22.06
$36,718
(3) 
The Home Depot, Staples, Petco, 99 Ranch

22
        
                                        

URBAN EDGE PROPERTIES
 
 
PROPERTY STATUS REPORT
As of June 30, 2017
 
 
(dollars in thousands, except per sf amounts)
 
 
 
 
 


Property
Total Square Feet (1)
Percent Leased(1)
Weighted Average Annual Rent per sq ft (2)
Mortgage Debt(7)
 
Major Tenants
Hazlet
95,000

100.0%
3.43
—
 
Stop & Shop (5)
Jersey City (Hudson Mall)(6)
383,000

97.3%
14.08
$25,333
 
Marshalls, Big Lots, Toys "R" Us, Staples, Old Navy
Jersey City (Hudson Commons)
236,000

100.0%
12.37
$18,359
(3) 
Lowe’s, P.C. Richard & Son
Kearny
104,000

98.2%
19.53
—
 
LA Fitness, Marshalls
Lawnside
147,000

98.9%
14.66
$9,676
(3) 
The Home Depot, PetSmart
Lodi (Route 17 North)
171,000

100.0%
12.87
$10,271
(3) 
National Wholesale Liquidators
Lodi (Washington Street)
85,000

87.6%
20.43
—
 
Blink Fitness, Aldi
Manalapan
208,000

100.0%
17.54
$19,054
(3) 
Best Buy, Bed Bath & Beyond, Babies “R” Us, Modell’s Sporting Goods, PetSmart
Marlton
213,000

100.0%
14.18
$15,630
(3) 
Kohl’s, ShopRite, PetSmart
Middletown
231,000

99.1%
13.14
$15,729
(3) 
Kohl’s, Stop & Shop
Millburn(6)
102,000

98.6%
25.43
$24,000
 
Trader Joe's, CVS, PetSmart
Montclair
18,000

100.0%
26.20
$2,382
(3) 
Whole Foods Market
Morris Plains
177,000

88.0%
22.21
$19,351
(3) 
Kohl’s, ShopRite (5)
North Bergen (Kennedy Blvd)
62,000

100.0%
13.77
$4,615
(3) 
Food Bazaar
North Bergen (Tonnelle Ave)
410,000

100.0%
20.77
$100,000
 
Walmart, BJ’s Wholesale Club, PetSmart, Staples
North Plainfield
218,000

99.0%
10.02
—
 
Costco, The Tile Shop, La-Z-Boy, Petco (lease not commenced)
Paramus (leased through 2033)(8)
63,000

100.0%
46.61
—
 
24 Hour Fitness
Rockaway
173,000

94.8%
13.54
$11,909
(3) 
ShopRite, T.J. Maxx
South Plainfield (leased through 2039)(8)
56,000

96.3%
20.53
$4,639
(3) 
Staples, Party City
Totowa
271,000

100.0%
17.26
$22,428
(3) 
The Home Depot, Bed Bath & Beyond, buy buy Baby, Marshalls, Staples
Turnersville
98,000

100.0%
9.62
—
 
Haynes Furniture Outlet (DBA The Dump), Verizon Wireless
Union (2445 Springfield Ave)
232,000

100.0%
17.85
$25,802
(3) 
The Home Depot
Union (Route 22 and Morris Ave)
276,000

99.4%
18.14
$29,275
(3) 
Lowe’s, Toys “R” Us, Office Depot
Watchung
170,000

98.3%
16.84
$13,645
(3) 
BJ’s Wholesale Club
Westfield (One Lincoln Plaza)(6)
22,000

100.0%
33.12
$4,730
 
Five Guys, PNC Bank, Cake Boss
Woodbridge (Woodbridge Commons)
226,000

78.5%
13.20
$18,706
(3) 
Walmart
Woodbridge
(Plaza at Woodbridge)(6)
411,000

80.6%
17.04
$55,340
 
Best Buy, Raymour & Flanigan, Toys “R” Us, Lincoln Tech, Harbor Freight, Retro Fitness
 
New York:
 
 
 
 
 
 
Bronx (1750-1780 Gun Hill Road)
77,000

100.0%
34.55
—
 
Planet Fitness, Aldi
Bronx (Bruckner Boulevard)(6)
375,000

79.5%
20.37
—
 
Kmart, Toys “R” Us, ShopRite (lease not commenced)
Shops at Bruckner(6)
114,000

100.0%
34.06
$12,443
 
Fallas, Marshalls, Old Navy
Buffalo (Amherst)
311,000

100.0%
9.53
—
 
BJ’s Wholesale Club, T.J. Maxx, HomeGoods, Toys “R” Us, LA Fitness
Commack (leased through 2021)(8)
47,000

100.0%
20.69
—
 
PetSmart, Ace Hardware
Dewitt (leased through 2041)(8)
46,000

100.0%
22.51
—
 
Best Buy
Freeport (240 West Sunrise Highway) (leased through 2040)(8)
44,000

100.0%
20.28
—
 
Bob’s Discount Furniture
Freeport (437 East Sunrise Highway)
173,000

100.0%
21.95
$19,351
(3) 
The Home Depot, Staples
Huntington
205,000

100.0%
15.75
$15,084
(3) 
Kmart, Marshalls, Old Navy, Petco

23
        
                                        

URBAN EDGE PROPERTIES
 
 
PROPERTY STATUS REPORT
As of June 30, 2017
 
 
(dollars in thousands, except per sf amounts)
 
 
 
 
 


Property
Total Square Feet (1)
Percent Leased(1)
Weighted Average Annual Rent per sq ft (2)
Mortgage Debt(7)
 
Major Tenants
Inwood
100,000

99.3%
19.49
—
 
Stop & Shop
Mt. Kisco
189,000

97.1%
16.42
$14,672
 
Target, Stop & Shop
New Hyde Park (leased through 2029)(8)
101,000

100.0%
20.21
—
 
Stop & Shop
Oceanside
16,000

100.0%
28.00
—
 
Party City
Queens
46,000

77.5%
38.58
—
 
 
Rochester
205,000

100.0%
3.08
$3,970
(3) 
Walmart
Rochester (Henrietta)
(leased through 2056)(8)
165,000

97.9%
4.15
—
 
Kohl’s
Staten Island
165,000

93.2%
24.18
—
 
Western Beef, Planet Fitness
West Babylon
66,000

93.0%
17.09
—
 
Best Market, Rite Aid
Yonkers Gateway Center(6)

437,000

87.6%
16.28
$33,967
 
Burlington Coat Factory, Best Buy, DSW, PetSmart, Alamo Drafthouse Cinema

Pennsylvania:
 
 
 
 
 
 
Allentown
372,000

100.0%
12.26
$27,141
(3) 
Burlington Coat Factory, Giant Food, Dick's Sporting Goods, T.J. Maxx, Petco, Big Lots
Bensalem
185,000

100.0%
12.90
$13,471
(3) 
Kohl's, Ross Dress for Less, Staples, Petco
Bethlehem
153,000

93.9%
7.80
$5,061
(3) 
Giant Food, Petco
Broomall
169,000

100.0%
10.85
$9,676
(3) 
Giant Food, Planet Fitness, A.C. Moore, PetSmart
Glenolden
102,000

100.0%
12.43
$6,202
(3) 
Walmart
Lancaster
228,000

100.0%
4.76
$4,887
(3) 
Lowe's, Community Aid, Mattress Firm
Springfield (leased through 2025)(8)
41,000

100.0%
22.99
—
 
PetSmart
Wilkes-Barre (461 - 499 Mundy Street)
204,000

98.1%
12.34
—
 
Bob's Discount Furniture, Babies "R" Us, Ross Dress for Less, Marshalls, Petco
Wyomissing (leased through 2065)(8)
76,000

93.4%
16.99
—
 
LA Fitness, PetSmart
York
111,000

100.0%
9.21
$4,714
(3) 
Ashley Furniture, Tractor Supply Company, Aldi, Crunch Fitness
South Carolina:
 
 
 
 
 
 
Charleston (leased through 2063)(8)
45,000

100.0%
14.69
—
 
Best Buy
Virginia:
 
 
 
 
 
 
Norfolk (leased through 2069)(8)
114,000

100.0%
7.08
—
 
BJ’s Wholesale Club
Tyson’s Corner (leased through 2035)(8)
38,000

100.0%
43.04
—
 
Best Buy
Puerto Rico:
 
 
 
 
 
 
Las Catalinas
356,000

93.4%
34.85
$130,000
 
Kmart, Forever 21
Montehiedra(6)
539,000

93.5%
18.00
$116,658
 
Kmart, The Home Depot, Marshalls, Caribbean Theatres, Tiendas Capri
Total Shopping Centers and Malls
15,702,000
95.9%
$17.25
$1,420,605
 
 
WAREHOUSES:
 
 
 
 
 
 
East Hanover - Five Buildings(6)
942,000

91.7%
4.80
—
 
J & J Tri-State Delivery, Foremost Groups Inc., PCS Wireless, Fidelity Paper & Supply Inc., Meyer Distributing Inc., Consolidated Simon Distributors Inc., Givaudan Flavors Corp.
Total Urban Edge Properties
16,644,000

95.7%
$16.57
$1,420,605
 
 
(1) Percent leased is expressed as a percent of total existing square feet (gross leasable area) subject to a lease.
(2) Weighted average annual rent per square foot including ground leases and executed leases for which rent has not commenced is calculated by annualizing tenant's current base rent (excluding any free rent periods), and excludes tenant reimbursements, concessions and storage rent. Excluding ground leases where the Company is the lessor, the weighted average annual rent per square foot for our retail portfolio is $19.62 per square foot.
(3) Property is included in a cross-collateralized mortgage loan.
(4) Our ownership of Walnut Creek (Mt. Diablo) is 95% at June 30, 2017.
(5) The tenant has ceased operations at this location but continues to pay rent.
(6) Not included in the same-property pool for the purposes of calculating same-property cash NOI as of June 30, 2017.
(7) Mortgage debt balances exclude unamortized debt issuance costs.
(8) The Company is a lessee under a ground or building lease. The total square feet disclosed for the building will revert to the lessor upon lease expiration.

24


URBAN EDGE PROPERTIES
 
 
PROPERTY ACQUISITIONS AND DISPOSITIONS
 
For the six months ended June 30, 2017
 
 
(dollars in thousands)
 
 
 
 
 
2017 Property Acquisitions:
 
 
 
 
 
 
 
 
 
 
Date Acquired
Property Name
City
State
GLA
Price(3)
1/4/2017
Yonkers Gateway Center(1)
Yonkers
NY
—
$
51,700

1/17/2017
Shops at Bruckner(2)
Bronx
NY
114,000
32,000

2/2/2017
Hudson Mall
Jersey City
NJ
383,000
43,700

5/24/2017
Yonkers Gateway Center(1)
Yonkers
NY
437,000
100,688

5/24/2017
The Plaza at Cherry Hill
Cherry Hill
NJ
413,000
51,348

5/24/2017
Manchester Plaza
Manchester
MO
131,000
19,794

5/24/2017
Millburn Gateway Center
Millburn
NJ
102,000
43,748

5/24/2017
21 E Broad St / One Lincoln Plaza
Westfield
NJ
22,000
9,670

5/25/2017
The Plaza at Woodbridge
Woodbridge
NJ
411,000
99,752

 
 
 
 
 
 
2017 Property Dispositions:
 
 
 
 
 
 
 
 
 
 
6/30/2017
Eatontown
Eatontown
NJ
32,000
$
5,000

(1) On January 4, 2017, we acquired fee and leasehold interests, including the lessor position under an operating lease for the whole property. On May 24, 2017, we purchased the remaining fee and leasehold interests not previously acquired, including the lessee position under the operating lease for the whole property.
(2) Represents the acquisition of the ground lease at the Shops at Bruckner. The Company now owns both the fee and ground lease positions in the property.
(3) Excludes $11.3 million of transaction costs incurred since January 1, 2017.



25

URBAN EDGE PROPERTIES
 
 
DEVELOPMENT, REDEVELOPMENT AND ANCHOR REPOSITIONING PROJECTS
 
As of June 30, 2017
 
 
(in thousands, except square footage data)
 
 
 
 
 
 
Estimated Gross Cost(1)
 
Incurred as of 6/30/17
Balance to Complete (Gross Cost)
Target Stabilization(2)
Description
ACTIVE PROJECTS
 
 
 
 
 
Bruckner
$
56,500

 
$
20,400

36,100

3Q18
Renovating and retenanting 64,000± sf; ShopRite, Boston Market, T-Mobile and Urban Health leases executed
Bergen Town Center-Phase 1(3)
46,700

 
8,200

38,500

2Q19
Renovating and retenanting; adding a 40,000± sf anchor to main mall and 15,000± sf adjacent to REI (10,000 sf leased to Kirklands); expanding Kay (executed) and adding Cava Grill (leased); improving parking deck
Montehiedra Town Center
20,800

 
17,800

3,000

2Q18
Converted to outlet/value hybrid offering; completing leasing
Garfield - Phase 1(3)
17,400

 
15,800

1,600

4Q17
New Burlington and PetSmart open; Ulta opening 3Q17; 7,000± sf shop space under construction
North Plainfield(3)
7,200

 
4,800

2,400

4Q17
Added La-Z-Boy; Petco (leased) and 7,600± sf of shop space under construction
Towson - Phase 1
6,400

 
4,500

1,900

2Q18
Recaptured anchor; Kirkland's, Tuesday Morning and Five Below, open; Ulta opening 3Q17
Hackensack(3)
4,700

 
2,200

2,500

1Q18
Released vacant supermarket to 99 Ranch (under construction); 10,000± sf of remaining 15,000± sf leased
East Hanover(3)
5,100

 
3,100

2,000

4Q17
Renovating and retenanting; leased junior anchor box to Saks Off Fifth
Marlton(3)
3,300

 
300

3,000

2Q18
New outparcel buildings for Shake Shack and honeygrow under construction
Turnersville(3)
2,100

 
2,000

100

3Q17
Verizon open
Lawnside(3)
2,100

 
200

1,900

3Q18
6,000± sf shop space under construction (100% committed)
Glen Burnie(3)
1,300

 
300

1,000

4Q18
Securing public approvals for Bubba's 33 pad (leased)
Rockaway(3)
100

 
100

—

4Q17
Popeyes under construction

Total
$
173,700

(4) 
$
79,700

$
94,000

 
 
 
 
 
 
 
 
COMPLETED PROJECTS(2)
Description
East Hanover warehouses
24,000

 
21,200

2,800

2Q17
Renovation completed; occupancy increased from 45% to 92%
Walnut Creek (Olympic)
5,000

 
5,000

—

4Q16
Anthropologie open
Walnut Creek (Mt. Diablo)(3)
600

 
600

—

1Q17
Z Gallerie open
Freeport(3)
100

 
100

—

1Q17
Expanded Home Depot open
Total
$
29,700

(4) 
$
26,900

$
2,800

 
 
 
 
 
 
 
 
 
(1) Estimated gross cost includes the allocation of internal costs such as labor, interest and taxes.
(2) Target Stabilization reflects the first quarter in which at least 80% of the expected NOI from the project is realized on a cash basis for the entire quarter. A project achieving Target Stabilization is classified as Completed whether or not all costs have been expended and remains listed as a Completed project for one year in the table above. The Target Stabilization date is an estimate and is subject to change resulting from uncertainties inherent in the development process and not wholly under the Company's control.
(3) Results from these properties are included in our same-property metrics.
(4) The estimated, unleveraged yield for Active and Completed projects is 10% as of June 30, 2017 based on total estimated project costs for and the incremental, unleveraged NOI directly attributable to the projects. The decrease from the first quarter of 2017 reflects increased construction costs offset by increased NOI. The incremental, unleveraged NOI for Active and Completed projects excludes NOI generated outside the project scope such as the impact on future lease rollovers or on the long-term value of the property.


26

URBAN EDGE PROPERTIES
 
 
DEVELOPMENT, REDEVELOPMENT AND ANCHOR REPOSITIONING PROJECTS
 
As of June 30, 2017
 
 
(in thousands, except square footage data)
 
 
 
 
 

 
Estimated Gross Cost(1)
Estimated Stabilization(1)(3)
Description
PIPELINE PROJECTS
Bergen Town Center -
 
 
 
Phase II A
$10,000-11,000

2018-2019

Develop parcel approved for 40,000± sf of retail
Phase II B
$5,000-6,000
2018-2019
Replace underperforming tenants with better performing, higher rent paying tenants
Phase III

$16,000-18,000
2020

Recapture space from and expand selected tenants; replace underperforming tenants; develop Rt. 4 pad if not used for garage entrance; develop Parcel I approved for 20,000± sf
Kearny
$7,000-8,000
2018
Expanding by 20,000± sf and adding new pad
Montehiedra outparcel
$7,000-8,000
2019
Developing 20,000± sf retail on excess land
Towson - Phase II
$5,000-6,000
2019
Retenanting former hhgregg space
Garfield - Phase II
$4,000-5,000
2019
Adding 15,000± sf of shop space
Morris Plains
$3,000-4,000
2018
Release former supermarket space
West Babylon
$3,000-4,000
2018
Developing 10,000± sf of shops
Huntington
$2,000-3,000
2018
Converting 11,000± sf of basement space into street-front retail
Woodbridge
$2,000-3,000
2019
Retenanting or converting building to pads
Mt. Kisco
$2,000-3,000
2019
Converting existing restaurant to two or three smaller spaces including food offerings
Cherry Hill
$1,000-2,000
2018
Developing approved pad for 5,000± sf of retail
Multiple Pad Projects(2)
$1,000-2,000
2018
Developing new pads
Gun Hill
$1,000-2,000
2019
Expanding Aldi supermarket (lease executed); seeking public approvals
Rockaway
±$1,000
2018
Expanding supermarket
Total
$69,000-86,000
(4) 
 
(1) Estimated Stabilization and Estimated Gross Cost are subject to change from uncertainties inherent in the development process and not wholly under the Company's control.
(2) Multiple Pad Projects include possible new pads at the following properties: East Rutherford, Springfield, Morris Plains and North Bergen. These projects are on land leased to or controlled by anchors and require anchor collaboration.
(3) Estimated Stabilization reflects the first year in which Target Stabilization occurs. See footnote 2 on page 26.
(4) The estimated, unleveraged yield for Pipeline projects is 9% as of June 30, 2017 based on the total, estimated project costs of and the incremental, unleveraged NOI expected from the projects. The incremental, unleveraged NOI for Pipeline projects excludes NOI generated outside the project scope such as the impact on future lease rollovers or on the long-term value of the property.



27


URBAN EDGE PROPERTIES
 
 
DEBT SUMMARY
 
As of June 30, 2017 and December 31, 2016
 
 
(in thousands)
 
 
 
 
 

 
June 30, 2017
 
December 31, 2016
Fixed rate debt
$
1,292,849

 
$
1,166,804

Variable rate debt
127,756

 
38,756

Total debt
$
1,420,605

 
$
1,205,560

 
 
 
 
% Fixed rate debt
91.0
%
 
96.8
%
% Variable rate debt
9.0
%
 
3.2
%
Total
100
%
 
100
%
 
 
 
 
 
 
 
 
Secured mortgage debt
$
1,420,605

 
$
1,205,560

Unsecured debt
—

 
—

Total debt
$
1,420,605

 
$
1,205,560

 
 
 
 
% Secured mortgage debt
100
%
 
100
%
% Unsecured mortgage debt
N/A

 
N/A

Total
100
%
 
100
%
 
 
 
 
Weighted average remaining maturity on secured mortgage debt
5.2 years

 
4.8 years

 
 
 
 
 
 
 
 
Total market capitalization (see page 16)
$
4,277,576

 
 
 
 
 
 
% Secured mortgage debt
33.2
%
 
 
% Unsecured debt
—
%
 
 
Total debt : Total market capitalization
33.2
%
 
 
 
 
 
 
 
 
 
 
Weighted average interest rate on secured mortgage debt(1)
4.11
%
 
4.20
%
Weighted average interest rate on unsecured debt(2)
—
%
 
 
 
 
 
 
Note: All amounts and calculations exclude unamortized debt issuance costs on mortgages payable.
(1) Weighted average interest rates are calculated based on balances outstanding at the respective dates.
(2) No amounts are currently outstanding on the unsecured line of credit. To the extent borrowing occurs, the line bears interest at LIBOR plus 1.15% based on our current leverage metrics as defined in the revolving credit agreement. The line matures in March 2021 and has two six-month extension options.





28

URBAN EDGE PROPERTIES
 
 
MORTGAGE DEBT SUMMARY
 
As of June 30, 2017 (unaudited) and December 31, 2016
 
 
(dollars in thousands)
 
 
 
 
 
Debt Instrument
Maturity Date
Rate
June 30, 2017
December 31, 2016
Percent of Debt at June 30, 2017
Englewood(3)
10/1/18
6.22
%
$
11,537

$
11,537

0.8
%
Cross collateralized mortgage - Fixed(4)
9/10/20
4.38
%
511,739

519,125

36.1
%
Cross collateralized mortgage - Variable(1)(4)
9/10/20
2.36
%
38,756

38,756

2.7
%
Montehiedra, Puerto Rico (senior loan)(2)
7/6/21
5.33
%
86,658

87,308

6.1
%
Montehiedra, Puerto Rico (junior loan)(2)
7/6/21
3.00
%
30,000

30,000

2.1
%
Plaza at Cherry Hill(8)
5/24/22
2.82
%
28,930

—

2.0
%
Westfield - One Lincoln(8)
5/24/22
2.82
%
4,730

—

0.3
%
Plaza at Woodbridge(8)
5/25/22
2.82
%
55,340

—

3.9
%
Bergen Town Center
4/8/23
3.56
%
300,000

300,000

21.1
%
Shops at Bruckner
5/1/23
3.90
%
12,443

—

0.9
%
Hudson Mall(7)
12/1/23
5.07
%
25,333

—

1.8
%
Yonkers Gateway Center
4/6/24
4.16
%
33,967

—

2.4
%
Las Catalinas
8/6/24
4.43
%
130,000

130,000

9.2
%
North Bergen (Tonnelle Avenue)
4/1/27
4.18
%
100,000

73,951

7.0
%
Manchester Plaza
6/1/27
4.32
%
12,500

—

0.9
%
Millburn Gateway Center
6/1/27
3.97
%
24,000

—

1.7
%
Mount Kisco (Target)(5)
11/15/34
6.40
%
14,672

14,883

1.0
%
Total mortgage debt
 
4.11
%
$
1,420,605

$
1,205,560

100
%
Unamortized debt issuance costs
 
 
(8,208
)
(8,047
)
 
Total mortgage debt, net
 
 
$
1,412,397

$
1,197,513

 
DEBT MATURITY SCHEDULE
 
 
 
 
Year
Amortization
Balloon Payments
Premium/(Discount) Amortization
Total
Weighted Average Interest rate at maturity
Percent of debt maturing
   2017(6)
$
9,479

$
—

$
168

$
9,647

4.5%
0.7
%
2018
18,606

10,823

332

29,761

5.1%
2.1
%
2019
20,065

—

332

20,397

4.4%
1.4
%
2020
16,853

500,143

331

517,327

4.2%
36.4
%
2021
6,015

116,658

330

123,003

4.7%
8.7
%
2022
7,418

89,000

330

96,748

3.0%
6.8
%
2023
7,820

329,433

307

337,560

3.7%
23.8
%
2024
5,021

141,722

(25
)
146,718

4.4%
10.3
%
2025
3,298

—

(61
)
3,237

4.7%
0.2
%
Thereafter
13,520

123,225

(538
)
136,207

4.3%
9.6
%
Total
$
108,095

$
1,311,004

$
1,506

$
1,420,605

4.1%
100
%
 
Unamortized debt issuance costs
 
(8,208
)
 
 
 
Mortgage debt, net
 
$
1,412,397

 
 
(1) Subject to a LIBOR floor of 1.00%, currently bears interest at LIBOR plus 136 bps.
(2) As part of the planned redevelopment of Montehiedra Town Center, the Company is committed to fund $20.0 million for leasing and building capital expenditures of which $19.3 million has been funded as of June 30, 2017.
(3) On March 30, 2015, we notified the lender that due to tenants vacating, the property’s operating cash flow would be insufficient to pay its debt service. As of June 30, 2017 we were in default and the property was transferred to receivership. The Company no longer manages the property but will remain its title owner until the receiver disposes of the property.
(4) See Property Status Report on page 22 for each property that comprises the cross collateralized mortgage loan.
(5) The mortgage payable balance on the loan secured by Mt. Kisco -Target includes $1.1 million of unamortized debt discount as of June 30, 2017 and December 31, 2016, respectively. The effective interest rate including amortization of the debt discount is 7.34% as of June 30, 2017.
(6) Remainder of 2017.
(7) The mortgage payable balance on the loan secured by Hudson Mall includes $1.6 million of unamortized debt premium as of June 30, 2017. The effective interest rate including amortization of the debt premium is 3.11% as of June 30, 2017.
(8) Bears interest at LIBOR plus 160 bps.

29