Q1 2025 The Macerich Co Earnings Call

Operator: The The Ladies and gentlemen, thank you for standing by and welcome to the first quarter 2025 Macerich Earnings Conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded.

Ladies and gentlemen, thank you for standing by and welcome to the first quarter 'twenty twenty-five mates Rich earnings conference call. At this time, all participants are in a listen only mode.

After the speaker's presentation, there will be a question and answer session.

Speaker Change: To ask a question. During this session you will need to press star one on your telephone you would then here and automate them. That's advising your hand is raised to withdraw your question. Please press star one again please.

Speaker Change: Please be advised that today's conference is being recorded.

Samantha Greening: I would like now to turn the conference over to Samantha Greening, Assistant Vice President, Director of Investor Relations. Please go ahead. Thank you for joining us on our first quarter 2025 earnings call.

Speaker Change: I would like now to turn the conference over to Samantha Greening Assistant Vice President Director of Investor Relations. Please go ahead.

Speaker Change: Thank you for joining us on our first quarter of 2025 earnings call. During this call.

Samantha Greening: During this call, we'll be making certain statements that may be deemed forward looking within the meaning of the safe harbor of the Private Security Litigation Reform Act of 1995, including statements regarding projections, plans, and future expectations. Actual results may differ materially due to a variety of risks and uncertainties set forth in today's press release and our FEC findings.

Speaker Change: Certain statements that may be deemed forward looking within the meaning of the safe Harbor of the private Securities Litigation Reform Act of 1095, including statements regarding projections plans and future expectations.

Speaker Change: Actual results may differ materially due to a variety of risks and uncertainties set forth in today's press release and our SEC filings.

Samantha Greening: Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included in the earnings release and supplemental filed on Form 8K with SEC, which was posted in the investor section of the company's website at macerich.com.

Speaker Change: Reconciliations of non-GAAP financial measures. The most directly comparable GAAP measures are included in the earnings release and supplemental filed on form 8-K, with the SEC, which is posted in the investors section of the company's website at <unk> Dot com.

Samantha Greening: Joining us today are Jack Hsieh, President and Chief Executive Officer, Dan Swanstrom, Senior Executive Vice President and Chief Financial Officer, and Doug Healey, Senior Executive Vice President of Police. And with us in the room is Brad Miller, SVP of Portfolio Management.

Jack: Joining us today are Jack <unk>, President and Chief Executive Officer, Dan Swanstrom, Senior Executive Vice President and Chief Financial Officer, and Doug Healey Senior Executive Vice President of leasing.

Jack: And with us in the room as Brad Miller SVP of portfolio management, and with that I'll turn the call over to Jack.

Jack Hsieh: And with that, I turn the call over to Jack. Thank you, Samantha, and good afternoon. We're pleased to discuss today the significant progress we continue to make in executing on our Path Forward plan.

Jack: Thank you Samantha and good afternoon.

Jack: We're pleased to discuss today the significant progress we continue to make in executing on our path forward plan.

Jack Hsieh: I want to make sure everyone comes away with three main themes from this call. Macerich is a much better informed, aligned, and operationally focused company than ever before. We are ahead of schedule on our leasing progress target. This gives us a greater line of sight and confidence into the key operational, financial, and deleveraging methods. embedded in our path forward plan. And third, this leasing progress demonstrates how close we are to our major inflection point in mid-2026. The point that indicates we would be substantially complete with the plan.

Jack: I want to make sure everyone comes away with three main themes from this call.

Jack: First.

Jack: MS, which is a much better informed aligned operationally focused company than ever before.

Jack: Second.

Jack: We are ahead of schedule on our leasing progress targets.

Jack: This gives us a greater line of sight and confidence into the key operational financial and deleveraging metrics and <unk>.

Jack: <unk> and our path forward plan.

Jack: And third this.

Jack: Leasing progress demonstrates how close we are to a major inflection point in mid 2026.

Jack: The point that indicates we will be substantially complete with the plan.

Jack: Yes.

Jack Hsieh: When I sent out the Path Forward plan in July of 2024, the goal was to create a new Macerich That required transforming the company by simplifying the business. Improving operational performance and reducing leverage. We put a mission statement in there. to own and operate thriving retail centers that bring our communities together and create long-term value for our shareholders, partners, and customers. We have still new corporate value. of Excellence, Empowerment, Integrity, Optimism, Relationships, and Fun. Based on the results I've seen today, I can attest to how well this mission and the corporate values have been embraced throughout the company.

Jack: When I started out the path forward plan in July of 2024. The goal was to create a new may switch.

Jack: That required transforming the company.

Jack: Simplifying the business.

Jack: Improving operational performance and reducing leverage.

Jack: We put a mission statement in place.

Jack: To own and operate thriving retail centers that bring our communities together and create long term value for our shareholders partners and customers.

Jack: We are still new corporate values.

Jack: Of excellence empowerment integrity.

Jack: <unk> optimism relationships and fun.

Jack: Based on the results I've seen to date I can attest to how well this mission and the corporate values had been embraced throughout the company.

Jack Hsieh: I also put in place a new structure that I talked about last quarter to streamline all our permanent, specialty, and department store leasing teams under one leadership and reporting structure. make our asset management team a standalone group. and place our property operations, marketing and development under a new leadership structure. To ensure that these teams could collaborate seamlessly with real-time tenant data and leverage the five-year ARGUS model, that the asset and portfolio management teams created Breach Property. We implemented a recent dashboard that we referred to internally. as the leasing speedometer. This tool and other technology enhancements we've implemented drive every leasing and capital allocation decision at our property.

Jack: I also put in place a new structure that I talked about last quarter to streamline all of our permanent specialty or department store leasing teams under one leadership and reporting structure.

Jack: Make our asset management team a standalone group.

Jack: And place our property operations marketing and development under a new leadership structure.

Jack: To ensure that these teams to collaborate seamlessly with real time tenant data.

Jack: Leverage the five year August models.

Jack: But the asset portfolio management teams created for each property.

Jack: We implemented our leasing dashboard that we referred to internally.

Jack: As the leasing speedometer.

Jack: This tool and other technology enhancements, we have implemented.

Jack: Every leasing and capital allocation decision at our properties.

Jack Hsieh: Everyone at Macerich is fully aligned on what we're doing. over the past six to nine months. We have de-risked the Path Forward Plan by consolidating joint ventures. is showing up with Completing our refinancings and executing our disposition.

Jack: Every one of them is rich is fully aligned on what we're doing.

Jack: Over the past six to nine months.

Jack: We have de risked the password plan by consolidated joint ventures.

Jack: Issuing equity.

Jack: <unk>, our refinancings and executing on dispositions.

Jack Hsieh: Today, I'll talk about the data that we have now that gives me the confidence that were on track to deliver our 2028 Leverage and Earnings Venture. This data shows that we're also on track with the major milestones and catalysts that can be expected to help us reach our mid-2026 For more information visit www.FEMA.gov Let's speak to leasing first. We think it's a piece of the plan that best tracks the progress on hitting our 2028 target. It is what I am most focused on today at Macerich. I believe that it is the most accurate predictor of Macerich's future success.

Jack: Today I'll talk about the data we have met we have known that gives me the confidence.

Jack: And we are on track to deliver our 2028 leverage and earnings metrics.

Jack: This data shows that we're also on track with the major milestones and catalysts that can be expected to help us reach our mid 2026.

Jack: Inflexion point.

Jack: Let's speak to leasing first.

Jack: We think it's a piece of the plan the best trucks, the progress on hitting our 2020 targets.

Jack: It is what I am most focused on today at matrix.

Jack: I believe that it is the most accurate predictor of matrix its future success.

Jack Hsieh: I'm pleased to say that we are ahead of schedule on all our leasing I noted last quarter that we are targeting an average of 4 million square feet of leasing in 2025 and 2026. During the first quarter, we signed 2.6 million square feet of lease. including 2.3 million square feet of renewal. As Doug will describe in a moment, that's when I doubled the leases signed in the first quarter a year ago. Between commitments and LOIs, we are nearly done with our 2025 lease expiration. We are now well into 2026. We are also laser focused on a higher percentage of new lease deals versus renewals in our annual mix of business.

Jack: I'm pleased to say that we are ahead of schedule on all our leasing efforts.

Jack: I noted last quarter that we are targeting an average of 4 million square feet of leasing in 2025 and 2026.

Jack: During the first quarter, we signed $2 6 million square feet of leases include.

Jack: Including $2 3 million square feet of renewals.

Doug: As Doug will describe in a moment.

Jack: That's more than double the leases signed in the first quarter a year ago.

Jack: Between commitments and otherwise we are nearly done with our 2025 lease explorations.

Jack: We are now well into 2026.

Jack: Lease explorations.

Jack: We are also laser focused on a higher percentage of new lease deals versus renewals.

Jack: Annual mix of business.

Jack Hsieh: as new deals will be the primary driver. higher spread. and incremental revenue to hit our NOI goal. We are tracking our progress on this front with two metrics. The New Deal Completion Percentage that we track internally. on our leasing speedometer. and our Snowpipe. has laid out in our last quarter earnings. Our initial goal on new deals was 50% progress by mid-2025. 70% by year-end 2025. Hitting the 70% goal by year-end would put us on track for the mid-80% range by mid-2026. Reaching that goal also puts us on track for our ultimate opportunity to achieve the 130 million in cumulative snow potential that I outlined last quarter.

Jack: As new deals will be the primary driver.

Jack: Higher spreads.

Jack: Incremental revenue to hit our NOI goal.

Jack: We are tracking our progress on this front with two metrics.

Jack: The new deal completion percentage that we track internally.

Jack: On our leasing speedometer.

Jack: And our snow pipeline.

Jack: As laid out in our last quarter earnings call.

Jack: Our initial goal on new deals was 50% progress by mid 2025.

Jack: 70% by year end 2025.

Jack: Hitting the 70% goal by year end would put us on track for the mid 80% range by mid 2026.

Jack: Reaching that goal also puts us on track for our ultimate opportunity to achieve the $130 million in cumulative snow potential that I outlined last quarter.

Jack Hsieh: Wishing that mid-2026 leasing goal would effectively complete the new leasing goal outlined in our original plan. As I noted earlier, we are ahead of this plan. As of last quarter, our leasing speedometer was at 39%. I'm pleased to report that we are currently at 60% for New Deal completion and have a large pipeline of LOIs. which gives us tremendous confidence in hitting the 70% mark by year-end. Last quarter, our snow pipeline was 66 million. That has now grown on a cumulative basis to $80 million as of today. which puts us on track to achieve a total and cumulative snow pipeline of 100 million by year end.

Jack: Reaching that 20 mid 2026 leasing go would effectively complete the new leasing goal outlined.

Jack: In our original plan.

Jack: As I noted earlier, we are ahead of this plan.

Jack: As of last quarter, our leasing speedometer was 39%.

Jack: I am pleased to report that we are currently at 60% for new deal completion.

Jack: We have a large pipeline of Belo lives.

Jack: Which gives us tremendous confidence in hitting the 70% mark by year end.

Last quarter, our snow pipeline was $66 million.

Jack: That has now grown on a cumulative basis to $80 million as of today.

Jack: Which puts us on track to achieve a total.

Jack: <unk> pipeline of $100 million by year end.

Jack Hsieh: Doug will provide additional details on our snow pipeline shortly.

Jack: Doug will provide additional details on our snow pipeline shortly.

Jack Hsieh: While we're on the topic of leasing, I want to address the inevitable question on tariffs and any impact we're seeing. I'll echo what many CEOs have already said this quarter. that we've seen minimal impact to date across the portfolio. We've had three strong executive leasing committees since early April. and a touch base with all retailers with leases out. and virtually all are moving forward. In addition, we're in contact with existing tenants. So far, there is no material effect on their business or inventory. will obviously continue to monitor these discussions and developments in real time.

Jack: While we're on the topic of leasing I want to address the inevitable question on tariffs and any impact we're seeing.

Jack: I'll Echo what many Ceos have already said this quarter.

Jack: That we've seen minimal impact to date across the portfolio.

Jack: We've had three strong executive leasing committees since early April.

Jack: And Ive touched base with all retailers with leases out.

Jack: Virtually all are moving forward.

Jack: In addition, we're in contact with existing tenants and so far there is no material effect on their business or inventories.

Jack: We'll obviously continue to monitor these discussions and developments in real time.

Jack Hsieh: For our target of $2 billion of asset sales alone, give the We continue to execute on targeted dispositions, which strengthen the balance sheet, and I'm pleased with the substantial progress made by the team.

Jack: For our target of $2 billion of asset sales alone give backs.

Jack: We continue to execute on targeted dispositions, which strengthen the balance sheet.

Jack: And I am pleased with the substantial progress made by the team.

Dan Swanstrom: Dan will provide an update on these activities shortly.

Dan: Dan will provide an update on these activities shortly.

Jack Hsieh: We're approaching the balance of 2025 with a significant amount of confidence in the outcome and timing of our plan. as well as the clear conviction. We have de-risked the elements of the path forward plan. This conviction is based on the fact that we have simplified the business consolidating JV which also enabled us to execute the refinancing on Washington Square. Dispositions have reached a total of $1.1 billion. We completed the equity raise ahead of plan, raising $500 million. Refinancings are ahead of plan for $1 billion in total. We've locked in least escalations. that are a massive part of the expected list.

We're approaching the balance of 2025 with a significant amount of confidence in the outcome and timing of our plan.

Dan: As well as the clear conviction.

Dan: We have derisked the elements of the path forward planning.

Dan: This conviction is based on the fact that we have simplified the business.

Dan: Consolidating JV.

Dan: Which also enables us to execute the refinancing on Washington Square.

Dan: Dispositions have reached a total of $1 1 billion.

Dan: We completed the equity raised ahead of plan raising $500 million.

Dan: Refinancings are ahead of plan for $1 billion in total.

Dan: We've locked in lease Escalations.

Dan: That are a massive part of the expected lift.

Jack Hsieh: And lastly. Efforts to secure new leases are well ahead of plan. All we have remaining to achieve the plan. is 50 million of snow. and completion of the remaining mold dispositions and give back. as well as the out parcel sale. I'm confident our leasing and asset management teams can deliver on these two remaining pieces.

Dan: And lastly.

Dan: <unk> has secured new leases are well ahead of plan.

Dan: All we have remaining to achieve the plan.

Dan: Is $50 million of snow.

Dan: And completion of the remaining mall dispositions and give backs.

Dan: As well as the out parcel sales.

Dan: I am confident.

Dan: Our leasing and asset management teams to deliver on these two remaining pieces.

Jack Hsieh: In conclusion... We have exceptional talent here at Macerich. And I'm pleased to see how well the team is collaborating using the tools and technology we've implemented. We are ahead of plan and have proven that we have the right process, strategies, and team in place with great retail centers.

Dan: This conclusion.

Dan: We have exceptional talent here it may switch.

Dan: And I'm pleased to see how well the team is collaborating using the tools and technology we've implemented.

Dan: We are ahead of plan.

Dan: And improvement that we have the right process strategies and team in place with great retail centers that.

Douglas Healey: that can drive mental rates with strong permanent With that, I'll turn the call over to Douglas. Thanks, Jack. Portfolio sales at the end of the first quarter were $837 per square foot, which is flat when compared to the fourth quarter, 2024. However, when you exclude our Eddie profits, Sales were $928 per square foot, which is up $13 compared to the last quarter. Traffic for the year is up 2% when compared to the same period in 2024. Occupancy in the first quarter was 92.6% down from 94.1% when compared to the fourth quarter 2024. Most of this decline is due to the decrease in temporary holiday stores which closed at the end of 2024 or during the first quarter 2025, as well as transitioning Fashion District Philadelphia from a development project back into same center occupancy.

Dan: That can drive rental rates with strong permanent occupancy.

Doug: With that I'll turn the call over to Doug.

Thanks Jack.

Doug: Portfolio sales at the end of the first quarter were $837 per square foot, which is flat when compared to the fourth quarter 2024.

Doug: However, when you exclude our Eddy properties sales were $928 per square foot, which is up $13 compared to last quarter.

Doug: Traffic for the year is up 2% when compared to the same period in 2024.

Doug: Occupancy in the first quarter was 92, 6% down from 94, 1% when compared to the fourth quarter of 2024.

Doug: Most of this decline is due to a decrease in temporary holiday stores, which closed at the end of 2024 or during the first quarter 2025, as well as transitioning flash in fashion District, Philadelphia from a development project back into same center occupancy.

Douglas Healey: Portfolio occupancy, excluding our Eddie properties, was 95.2% for the quarter compared to 95.8% for the fourth quarter of 2024. Trailing 12-month leasing spreads as of March 31, 2025 were 10.9% versus 8.8% last quarter. This comprised of 22% spreads on new deals. 7% spread on renewables. And this now represents 14 consecutive quarters of positive leasing spread. Looking at the leasing spreads on a same-space basis. Spreads from new deals were 37.4% and spreads from renewals were 1.3%. In the first quarter, we opened 177,000 square feet of new stores while signing 320 leases for 2.6 million square feet.

Doug: Portfolio occupancy, excluding our Eddy properties was 95, 2% for the quarter compared to 95, 8% for the fourth quarter of 2024.

Doug: Trailing 12 month leasing spreads agile as of March 31, 2025 were 10, 9% versus eight 8% last quarter.

Doug: This comprised of 22% spreads on new deals and.

Doug: 7% spreads on renewals.

Doug: And this now represents 14 consecutive quarters of positive leasing spreads.

Doug: Looking at the leasing spreads on a same space basis spread.

Doug: Spreads for new deals were 37, 4% and spreads for renewals were one 3%.

Doug: In the first quarter, we opened 177000 square feet of new stores, while signing 320 leases for $2 6 million square feet.

Douglas Healey: In terms of these lease signings, this represents 50% more leases and 160% more square footage than we signed in the first quarter of 2024. And just looking at new deals, it's almost 70% more leases and 180% more square footage than first quarter 2024. The best brands remain very active and continue to take advantage of great space and centers. To that end, in the first quarter, we signed two flagship stores at Tyson's Corner Center, a 45,000 square foot Zara and an 18,000 square foot Uniqlo. Uniqlo will open in late 2025 and Zara in early 2026. Other notable signings in the first quarter include Aloe Yoga at Los Cerritos in Fentan Village, Abercrombie & Fitch at Broadway Plaza in the Village of Puerto Madera, Arritia at Los Cerritos, Rag & Bone at Fashion Isles of Chicago, and Laurel Piana at Scottsdale Fashion Square.

Doug: In terms of these lease signings this represents 50% more leases and 160% more square footage that we signed in the first quarter of 2024.

Doug: And just looking at new deals, it's almost 70% more leases and 180% more square footage than first quarter 2024.

Doug: The best brands remain very active and continue to take advantage of great space and centers.

Doug: To that end the first quarter, we signed two flagship stores that Tysons corner Center, a 45000 square foot Zara, and an 18000 square foot unit globe.

Doug: <unk> will open in late 2025, and Zara in early 2026.

Doug: Other notable signings in the first quarter include Allo yoga at low <unk> Fan-tan village, Abercrombie and Fitch at Broadway Plaza and the village at Corte Madera.

Doug: <unk> and <unk> Reg involved at fashion outlets of Chicago, and Loro Piana at Scottsdale fashion square.

Douglas Healey: This list goes on, but these examples are reflective of the continued flight to quality that retailers are pursuing, especially in our portfolio.

Doug: This list goes on but these examples are reflective of the continued flight to quality that retailers are pursuing especially in our portfolio.

Douglas Healey: Now let's look at our Executive Leasing Committee, which reviews and approves deals on a bi-weekly basis. This is much more forward-looking and a better representation of the current environment and retailer sentiment. To date, we've reviewed over 70% more new and renewal deals and 145% more square footage than we did during the same period last year. And if you look at new deals only, we've reviewed twice the number of new deals and four times the square footage that we did during the same period last year. And keep in mind, once these deals are approved, they go to lease, get signed, and eventually become part of our signed, not open pipeline.

Doug: Now, let's look at our executive leasing committee, which reviews and approves deals on a biweekly basis.

Doug: This is much more forward looking at a better representation of the current environment and retailers sentiment.

Doug: To date, we've reviewed over 70% more new and renewal deals at 145% more square footage than we did during the same period last year.

And if you look at new deals only we reviewed twice the number of new deals and four times. The square footage that we did during the same period last year and keep in mind. Once these deals are approved they golden lease gets signed and eventually become part of our signed not open pipeline.

Douglas Healey: Turning to our lease expirations. To date, we have commitments on just about 80% of our 2025 expiring score footage that is expected to renew and not close with another 16% in the letter of intent stage. So between commitments and LOIs, we're basically done with 2025 and now well into our 2026 lease expiration.

Doug: Turning to our lease explorations to date, we have commitments and just about 80% of our 2025 expiring square footage that is expected to renew and not close with another 16% in the letter of intent stage.

Doug: So between commitments and LOI is we're basically done with 2025 and now well into our 2026 lease explorations.

Douglas Healey: As we all know, in the first quarter, Forever 21 filed for bankruptcy. This being the only bankruptcy filing year-to-date in our portfolio. While Forever 21 had a lot of square footage, they didn't pay a lot of rent.

Doug: As we all know in the first quarter Forever 21 filed for bankruptcy this being the only bankruptcy filing year to date in our portfolio.

Doug: While forever 21 had a lot of square footage, we didn't pay a lot of rent.

Douglas Healey: We've anticipated this liquidation of stores for some time, and recapturing these stores will provide an excellent opportunity to remerchandise the space with higher and better uses, paying us significantly more rent. To date, we have commitments on just over 50% of the closed-square footage, with another 10% in the letter of intent state. With our commitments alone, we've already surpassed the rent Forever 21 was paying. And when we finalize this entire backfill endeavor, we anticipate we should more than double the rent for every 21 was paying in the aggregate.

Doug: As anticipated this liquidation stores for some time and recapturing. These stores will provide an excellent opportunity to re merchandize the space with higher and better uses paying a significantly more rent.

Doug: To date, we have commitments and just over 50% of the closed square footage with another 10% in the letter of intent stage.

Doug: With our commitments alone we've already surpassed the rent forever 21 was paying.

Doug: When we finalize this entire backfill endeavor, we anticipate we should more than double the rent forever.

Doug: One was paying in the aggregate.

Douglas Healey: Turning to our sign not open or snow pipeline. To date, we have 148 sign leases from 1.2 million square feet of new stores, which we expect to open between now and into early 2028. In addition to these signed leases, we're currently negotiating leases that were previously approved in our Executive Leasing Committee for new stores totaling just over 1.7 million square feet. And these too will open between now and into early 2028. So in total, that's nearly 3 million square feet of new store openings throughout the remainder of this year and beyond. The leasing activity has grown our snow pipeline from $66 million of last quarter to $80 million today.

Doug: Turning to our signed not opened or snow pipeline to date, we have 148 signed leases for one 2 million square feet of new stores, which we expect to open between now and into early 2028.

Doug: In addition to these signed leases were currently negotiating leases that were previously approved in our executive leasing committee for new stores totaling just over one 7 million square feet.

Doug: And these two will open between now and into early 2028.

Doug: So in total that's nearly 3 million square feet of new store openings throughout the remainder of this year and beyond.

Doug: The leasing activity.

Doug: Has grown our snow pipeline from $66 million of last quarter to $80 million today.

Douglas Healey: I'm very pleased with this growth in just 90 days, and it gives me confidence that we will hit $100 million by the end of the year. In 2045, we expect to realize approximately $25 million of the current $80 million pipeline. And of that $25 million, we've already realized $6 million in the first quarter. The remainder of the $80 million is anticipated to be realized between 2026 and early 2028.

Doug: I'm very pleased with this growth in just 90 days and it gives me confidence that we will hit $100 million by the end of the year.

Doug: In 2025, we expect to realize approximately $25 million of the current $80 million pipeline.

Doug: And of that $25 million, we've already realized $6 million in the first quarter.

Doug: The remainder of the $80 million is anticipated to be realized between 2026.

Doug: In early 2028.

Douglas Healey: Lastly, we're very excited to announce that we will be breaking ground this week on the redevelopment and expansion of Green Acres, which is located on Long Island in Valley Stream. This development is comprised of 370,000 square feet, which addresses 260,000 square feet of the vacant Sears and Kohl's boxes, along with the demolition of Sears TBA and parking deck. The project will open sight lines to the major highway in front of the mall and will include a new grand entrance along with an attractive streetscape showcasing outward facing shops as well as full service restaurants, quick service restaurants, grocery, entertainment and service use.

Doug: Lastly, we're very excited to announce that we will be breaking ground. This week on the redevelopment and expansion of Green acres, which is located on long Island in Valley stream.

Doug: This development is comprised of 370000 square feet, which addresses 260000 square feet of vacancy is in cold boxes, along with the demolition of Sears TBA and parking deck.

Doug: The project will open Sightlines to the major highway in front of the mall and will include a new brand entrants along with an attractive streetscape.

Doug: Showcasing outward facing shops as well as full service restaurants quick service restaurants grocery entertainment and service uses.

Douglas Healey: Demand and pre-leasing have been very strong, with almost 50% of the project's square footage committed and another 17% in the LOI state.

Doug: Demand in pre leasing has been very strong with almost 50% of the project square footage committed and another 17% in the LOI stage.

Douglas Healey: Tenets will open in phases beginning in 2026 with full completion by fall 2027. So stay tuned for several exciting announcements in the very near future.

Doug: Tenants will open in phases, beginning in 2026 with full completion by fall 2027.

Doug: So stay tuned for several exciting announcements in the very near future.

Dan Swanstrom: And with that, I'll turn the call over to Dan to go through our first quarter financial results. Thanks, Doug, and good afternoon. I'll start with a review of first quarter financial results. FFO excluding financing expense in connection with Chandler Freehold, accrued default interest expense, and loss on non-real estate investments was approximately $87 million, or $0.33 per share, during the first quarter of 2025, as compared to approximately $75 million, or $0.33 per share, for the first quarter of 2025. The primary driver of the $12 million increase in nominal FFO is higher leasing revenues, including from the net impact of JV interest acquisitions and dispositions activity, which more than offset increases in operating expenses and interest acquisitions.

Dan: And with that I'll turn the call over to Dan to go through our first quarter financial results.

Dan: Thanks, Doug and good afternoon, I'll start with a review of first quarter financial results.

Dan: <unk>, excluding financing expense in connection with Chandler freehold accrued default interest expense and loss on non real estate investments was approximately $87 million or <unk> 33 per share during the first quarter of 2025 as compared to approximately $75 million or <unk> 33 per share for the first quarter of 2010.

Dan: Four.

Dan: The primary driver of the $12 million increase in nominal <unk> as higher leasing revenues, including from the net impact of JV interest acquisitions, and dispositions activity, which more than offset increases in operating expenses and interest expense.

Dan Swanstrom: I would like to highlight the following items included in our FFO adjusted for the quarter. Number one, $9 million of interest expense relates to the amortization of debt mark to market resulting from our various JV interest acquisitions. This non-cash expense is included in the interest. Number two, $2 million of severance expense is included in management companies operating And number three, $6 million of legal claims, net settlement income at one of our properties related to a construction design defect. We believe aggregate proceeds recovered are more than adequate to cover our proposed solution. This $6 million is non-recurring in nature and is included in other.

Dan: I would like to highlight the following items included in our <unk> adjusted for the quarter.

Dan: Number one 9 million of interest expense relates to the amortization of debt mark to market, resulting from our various JV interest acquisitions.

Dan: This noncash expense is included in interest expense.

Dan: Number two 2 million of severance expense is included in management companies operating expenses.

Dan: And number three 6 million of legal claims net settlement income at one of our properties related to a construction design defect matter. We believe aggregate proceeds recovered are more than adequate to cover our proposed solution.

Dan: This $6 million is nonrecurring in nature and is included in other income.

Dan Swanstrom: Same center NOI, excluding lease termination income, increased 0.9% in the first quarter of 2025 compared to the first quarter of 2025. Excluding Eddie Yosses, Same Center NOI increased 2.4% year over year.

Dan: Same center NOI, excluding lease termination income increased <unk>, 9% in the first quarter of 2025 compared to the first quarter of 2024.

Dan: Excluding any assets same center NOI increased two 4% year over year.

Dan Swanstrom: Turning to the balance sheet, during the first quarter, we have made good progress on our path forward. We closed on a new $340 million 10-year mortgage loan on Washington Square at an attractive fixed interest rate of 5.58%. We used a portion of the net proceeds to repay the remaining first mortgage on Flatiron Crossing, which was approximately $72 million in our share, and to repay the balance outstanding on our line of credit, which was $110 million. Flatiron was a 2025 maturity, and inclusive of the $7.5 million MES loan in Flatiron that we paid off earlier in the quarter, carried an interest rate of just north of 9%.

Dan: Turning to the balance sheet during the first quarter, we have made good progress on our path forward plan.

Dan: We closed on a new $340 million 10 year mortgage loan on Washington Square at an attractive fixed interest rate of five 5%.

Dan: We used a portion of the net proceeds to repay the remaining first mortgage on flatiron crossing which was approximately $72 million at our share.

Dan: And to repay the balance outstanding on our line of credit which was $110 million.

Dan: Flatiron was a 2025 maturity and.

Dan: Inclusive of the $7 $5 million Mezz loan and flat iron that we paid off earlier in the quarter.

And an interest rate of just north of 9%.

Dan Swanstrom: Slovenia is now on income. For the balance of 2025, we have only one remaining maturing loan in November for approximately $200 million. And we'll continue to proactively address our remaining 2026 debt maturities through a combination of potential asset sales, refinancing, loan modifications, or loan giveback. We currently have approximately $995 million of liquidity, including $650 million of capacity on our revolving line of credit. From a leverage perspective, net debt to EBITDA at the end of the first quarter was 7.9 times. which is almost a full turn lower than at the outset of the path forward. And importantly, we've outlined our strategy to further reduce leverage to the low to mid six times range over the next couple of years.

Dan: Florida is now unencumbered for.

Dan: For the balance of 2025, we have only one remaining maturing loan in November for approximately $200 million.

Dan: And we will continue to proactively address our remaining 2026 debt maturities through a combination of potential asset sales refinancings loan modifications or loan give backs.

Dan: We currently have approximately $995 million of liquidity, including $650 million of capacity on our revolving line of credit.

Dan: From a leverage perspective net debt to EBITDA at the end of the first quarter was seven nine times.

Dan: Which is almost a full turn lower than at the outset of the path forward plan.

Dan: And importantly, we've outlined our strategy to further reduce leverage to the low to mid six times range over the next couple of years.

Dan Swanstrom: We continue to make substantial progress in executing on planned dispositions as part of the path forward. In March, we closed on the sale of Wilton Mall for $25 million. In April, we closed on the sale of South Park for $11 million. Both assets were unencumbered. We are currently under contract to sell Lakewood, which is expected to close in the second half of 2025, subject to customary closing conditions. We expect net proceeds to Macerich of approximately $5 million above the debt balance of These sales transactions are consistent with our stated disposition plan to improve the balance sheet and refine our portfolio.

Dan: We continue to make substantial progress in executing on plan dispositions as part of the path forward plan.

Dan: In March we closed on the sale of Wilton mall for $25 million.

Dan: In April we closed on the sale of South Park for $11 million.

Dan: Both assets were unencumbered.

Dan: We are currently under contract to sell liquid which is expected to close in the second half of 2025 subject to customary closing conditions.

We expect net proceeds to make sure each of approximately $5 million above the debt balance outstanding.

Dan: These sales transactions are consistent with our stated disposition plan to improve the balance sheet and refined our portfolio.

Dan Swanstrom: With respect to our bucket of disposition out parcels, freestanding retail, non-enclosed malls and land, we have also made considerable progress toward our 2025 goal of 100 million to 150 million in total sales for the year. During the first quarter, we closed on 7 million at our share of land sales. In April, at Santan Village, we closed on the sale of vacant lots for $25 million at our share and three out-parcel assets for $7 million at our For more information visit www.FEMA.gov And I'm very pleased to report that we currently have approximately 17 million of additional land sales and approximately 21 million of additional out parcel sales under contract.

Dan: With respect to our bucket of disposition and out parcels freestanding retail non enclosed malls and land.

Dan: We have also made considerable progress toward our 2025 goal of $100 million to $150 million in total sales for the year.

During the first quarter, we closed on $7 million at our share of land sales.

Dan: In April at Santana village, we closed on the sale of vacant lots for $25 million at our share in three out parcel assets for $7 million at our share.

Dan: And I'm very pleased to report that we currently have approximately $17 million of additional land sales.

Dan: And approximately $21 million of additional out parcel sales under contract, which are expected to close in the second half of 2025 subject to customary closing conditions.

Dan Swanstrom: which are expected to close in the second half of 2025, subject to customary closing conditions. This brings us to $77 million sold or under contract against our 100 to $150 million target for 2025.

Dan: This brings us to $77 million sold or under contract against our $100 million to $150 million target for 2025.

Dan: Yes.

Dan Swanstrom: To recap on the Path Forward Plan's significant progress to date on the three key pillars to reduce levels. 1. Jack and Doug provided an update on the successful leasing progress to date that is a critical component of delivering on the NOI growth component of Two, we achieved the equity issuance component of the plan in the fourth quarter of 2020. And three, we have made substantial progress on the sales and give back component of the plan and have identified a clear path to achieving our $2 billion disposition target. To date, we have completed almost 800 million, and as you will see in the incremental disclosure we've provided in our supplement, this includes Country Club Plaza, Biltmore, the Oaks.

Dan: To recap on the path forward plans significant progress to date on the three key pillars to reduce leverage.

Speaker Change: One Jack and Doug provided an update on the successful leasing progress to date that is a critical component of delivering on the NOI growth component of the plan.

Speaker Change: Two we achieved the equity issuance component of the plan in the fourth quarter of 2024.

Speaker Change: And three we have made substantial progress on the sales and give back component of the plan and have identified a clear path to achieving our $2 billion disposition target.

Speaker Change: To date, we have completed almost $800 million and as you will see in the incremental disclosure we've provided in our supplement this includes country club Plaza built.

Speaker Change: Biltmore the Oaks.

Dan Swanstrom: Southridge, Wilton Mall, and South Park, all of which are closed. Santa Monica Place, in which the loan encumbering this property is in default. And then Atlas Park, which is currently being marketed. The sale of Lakewood, which is now under contract, would increase our sales completed total to just over $1.1 billion. And then we have identified internally several additional assets totaling up to $400 million for sale or give back over the next one to two years. The remaining dispositions in our plan represent the sale of L parcels, freestanding retail, non-enclosed mall assets, and light We continue to expect to be substantially complete on this last bucket of the disposition program by the end of 2026.

Speaker Change: South Ridge, Wilton Mall, and South Park, all of which are closed.

Speaker Change: Santa Monica place in which the loan encumbering the properties in default.

Speaker Change: And then Atlas Park, which is currently being marketed for sale.

Speaker Change: The sale of Lakewood, which is now under contract would increase our sales completed total to just over $1 1 billion.

Speaker Change: And then we have identified internally several additional assets totaling up to 400 million for sale or give back over the next one to two years.

Speaker Change: The remaining dispositions in our plan represent the sale of our parcels freestanding retail non enclosed mall assets and land.

Speaker Change: We continue to expect to be substantially complete on this last bucket of the disposition program by the end of 2026.

Dan Swanstrom: will provide further updates on these sales as we progress through the year.

Speaker Change: We'll provide further updates on these sales as we progress through the year.

Dan Swanstrom: In conclusion, we are making great progress on our path forward plan objectives to reduce leverage, refine the portfolio and strengthen the balance.

In conclusion, we are making great progress on our path forward plan objectives to reduce leverage refine the portfolio and strengthen the balance sheet.

Operator: With that, we'll turn the call back over to the operator. Thank you.

Speaker Change: With that I will turn the call back over to the operator.

Speaker Change: Thank you as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced.

Operator: As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again.

Speaker Change: Your question. Please press star one again.

Operator: We ask that you limit to one question and return to the queue for follow-up to allow everyone an opportunity to ask a question.

Speaker Change: We ask that you limit to one question and return to the queue for follow up to allow everyone an opportunity to ask a question.

Speaker Change: And our first question.

Keevin Kim: will come from Keevin Kim with Truist. Your line is open. Thank you. Good morning. And congrats. Congratulations on a good quarter. So first question, I know this answer might be a little bit different, and you touched on the customer reactions and the trade tariffs. But, you know, with the news from this weekend, do you think there's any potential upside on leasing going forward?

Kim: Will come from Keybanc, Kim with true with <unk>. Your line is open.

Speaker Change: Thank you good morning.

Speaker Change: And congrats congratulations on a great quarter.

Speaker Change: First question I noticed the answer might be a little bit different and you touched on.

Speaker Change: Customer reactions to the trade tariffs, but with the news from this weekend do you think there's any potential upside on leasing.

Speaker Change: Going forward.

Douglas Healey: Keith, Doug, I'll take that one. Let me let me talk about what we were seeing during the tariff. We did not see a lot of pullback.

Doug: Doug I'll take that one.

Doug: Let me, let me talk about what we were seeing during the tariff we did not see a lot of pullback in fact, a couple of weeks ago. We had our board meeting prior to that we contacted every one of our 40 national rent paying tenants and really none of them was pulling back on open to buys they were all honoring their leases.

Douglas Healey: In fact, a couple of weeks ago, we had our board meeting prior to that, we contacted every one of our 40 national rent paying tenants. And really, none of them was pulling back on open device, they were all honoring their leases out or their fully executed lease Okay, and on the snow pipeline of 80 million, that's a cumulative number.

Doug: <unk> order fully executed leases.

Doug: Then we actually looked at every lease we had out for signature contacted every retailer and there was only a handful that we're pulling back so.

Doug: We haven't seen a lot. Therefore, I don't think there's really any change in the upside I mean, the retailer sentiment is strong you can see it in our leasing metrics, what we signed what we approved an LLC and then most importantly, whats currently in our pipeline.

Doug: Okay and on the slow pipeline of $80 million.

Doug: Cumulative number but can you provide what is net incremental debt. We can expect when we model.

Douglas Healey: But can you provide what is net incremental that we can expect when we model? It is on the spread.

Doug: And as I'll add this is Brian I'll take that one so the $80 million incremental over of revenue being generated in our spaces from 2024.

Douglas Healey: I'll take that one. So the $80 million is incremental over the revenue being generated in the spaces from 2020. So that is our cumulative total that we expect to see in our model through 2028. Twenty-five of that will be realized in 2025. Okay, thank you.

Doug: So that is our cumulative total that we expect to see in our model through 2028, and 25 of that will be realized in $2025 and $6 million of that was realized in Q1.

Doug: Okay. Thank you.

Craig Mailman: And the next question will come from Craig Mailman with Citi. Your line is open. Hey, guys. You know, you mentioned a couple times that you're ahead of plan here on the leasing side of things, and you're doing well on the sale and givebacks. Just kind of curious, as you look at what you're spending on the leases to get them up and running on the CapEx side, is that trending ahead?

Craig Mailman: And the next question will come from Craig Mailman with Citi. Your line is open.

Craig Mailman: Hey, guys.

Craig Mailman: You had mentioned a couple of times that Youre ahead of plan here.

Craig Mailman: The leasing side of things.

The sale will give backs just kind of curious as you look at.

Craig Mailman: What you're spending on these leases to get them up and running.

Craig Mailman: On the Capex side is that trend that we had and then also just given the execution here when do you guys think you'd reinstate or giving guidance.

Craig Mailman: And then also, just given the execution here, when do you guys think you'd be in state giving guidance?

Craig Mailman: Okay.

Jackson Hsieh: Hey, Greg, this is Jackson. So, you know, on the stand, I think we talked about Spaces under 10,000 square feet, it's basically north of one times annual rent, from 1.2 to 1.4 times in that range. Obviously, for anchor deals, anchor deals are more expensive. 26 anchor deals that we believe will come online in 2028, 17 of the 26.

Craig Mailman: Hey, Greg This is Jackson so on the spend I think we've talked about on <unk>.

Craig Mailman: Spaces under 10000 square feet.

Craig Mailman: Basically north of one times annual rent.

Craig Mailman: One two to one four times in that range.

Craig Mailman: Obviously for anchor deals anchor deals are more expensive.

Craig Mailman: We have.

Craig Mailman: 26 anchor deals that we believe will come online in 2028, <unk> 17 of the 26.

Craig Mailman: <unk> already committed leases signed or leases out got it.

Craig Mailman: Another six <unk> and three a prospecting so.

Jackson Hsieh: I would say, generally, as we think about capital, you know, the plan is probably slightly more capital than initially envisioned when we came up with the path forward last year. The dollars are being spent faster, you know, in the model. And as we discussed last time, correspondingly, you're going to see the major uplift. in FFO and EBITDA in 27 and 28, just as it relates to the time it takes to deliver.

I would say generally as we think about capital.

Craig Mailman: The plan is probably slightly more capital than initially envisioned when we came out with a path for last year of $1.

Craig Mailman: A growth spurt faster in the model.

Craig Mailman: And as we discussed last time correspondingly you can see the major uplift.

Craig Mailman: <unk> EBITDA in 2728, just as it relates to the time it takes to deliver.

Craig Mailman: Okay and our next question.

Linda Tsai: will come from Linda Tsai with Jeffrey's, your line is open. Hi, thanks for taking my question. Great job with all the, you know, progress this quarter.

Speaker Change: Will come from Linda Tsai with Jefferies. Your line is open.

Linda Tsai: Hi, Thanks for taking my question great job with all the.

Jackson Hsieh: Just wondering about the success of the new deals in the quarter up 70% from a year ago, I assume that the new structure that you talked about to streamline permanent specialty and department store leasing under one leadership helps, but just any more color details you could provide about the success of, you know, the pace and new lease Yeah, thanks, Linda. It's Jackson. Look, the PACE works because of the way we've laid out the plan and organizational structure. Obviously, the leasing is consolidated into one team. But, you know, the asset management team, which rides as an equal partner to leasing, there's a very direct line of communication between asset management, leasing, how it affects portfolio management in our model and in our speedometer.

Speaker Change: Progress this quarter.

Speaker Change: Just wondering about the success of the new deals in the quarter up 70% from a year ago I assume that the new structure that you talked about to streamline permanent specialty and department store leasing under one leadership.

Speaker Change: But just any more color and details you could provide about the success of the pacing of leasing.

Speaker Change: Yes.

Speaker Change: Yes, Thanks, Linda Jackson looked at the pace works because of the way we've laid out the plan and our organizational structure.

Speaker Change: Obviously, the leasing is consolidated into one team.

Speaker Change: But the asset management team, which rides as an equal partner to leasing.

Speaker Change: There's a very direct.

Speaker Change: Communication between asset management leasing how it affects portfolio management in our model and then our speedometer speedometer once again just to reiterate that represents.

Jackson Hsieh: You know, that speedometer, once again, just to reiterate, that represents expected revenue, you know, from these new leases. So it's very important to be at 60% at this point. So I would say that while the pace has been... Honestly, incredible versus historical experience here. There's no reason why I can't stop or continue at this pace. It's, you know, we've got the right properties. Pen is going to be in there. We kind of know the right prescription. We know how to fix the model. We make decisions very rapidly and it seems like a very clear directive.

Speaker Change: Expected revenue.

Speaker Change: From these new leases so it's a very important to be at 60% at this point.

Speaker Change: So I would say that while the pace has been.

Speaker Change: Honestly incredible versus historical experience here.

Speaker Change: There is no reason why it can't stop or continue at this pace.

Speaker Change: We've got the right properties has one of the and there were no other REIT prescription with the hot effects the model will make decisions very rapidly and.

Speaker Change: It moves up very clear directive.

Jackson Hsieh: I also think, like I said, one of the reasons why I think we've really broken the back of this plan, the $15 million of remaining snow that we talk about, 20 million of that 50 is within our fortress properties, our best properties in the portfolio. And of the 50 million, 90% of that revenue is going to come from A, B, and C-rated states. So we're talking about the best space in our best centers, or our top centers, that are remaining to go. And so, yeah, we're gonna continue to lease at very aggressive levels, but we've got a lot of great space to lease still in great centers.

Speaker Change: I also think Mike.

Speaker Change: One of the reasons why I think we've really broken the back of this plan the $15 million of remaining snow and then we talk about.

$20 million of that 50 is with our fortress properties or our best properties in the portfolio.

Speaker Change: And of the 50 million 90%.

Speaker Change: Of that revenue is going to come from a b and C rated space.

Speaker Change: So we're talking about the best space.

Speaker Change: Best sellers for our top centers.

Speaker Change: <unk>.

Speaker Change: Our remaining to go and so yes, we're going to continue to lease at very aggressive levels, but we've got a lot of great space to lease though great centers.

Speaker Change: Just one follow up in terms of the funnel of tenants that you are considering have you opened up the funnel patents that you really think of it as well.

Linda Tsai: One follow up to that, in terms of the funnel of tenants that you're considering, have you opened up the funnel tenants that you're leasing to as well?

Jackson Hsieh: Linda, can you repeat the question, please? Oh, just wondering if you're considering a wider cohort of tenants that you would lease to. No, I think we've talked about this on several calls. You know, coming out of COVID, the breadth and depth of, we don't even call them retailers anymore, it's really uses has expanded tremendously. So when we talk about leasing, yeah, there are the key legacy retailers, they'll always be a part of our shopping centers. But you're also looking at digitally native and emerging brands, international brands, food and beverage, restaurants, medical, entertainment, you know, electric vehicles, fitness, home furnishings, groceries.

Linda can you repeat the question please.

Speaker Change: I was just wondering if you're considering a wider cohort of tenants that you would lease.

Speaker Change: No I think we've talked about this on several calls coming out of Covid.

Speaker Change: <unk>.

Speaker Change: The breadth and depth of we don't even call retailers anymore. It's really uses has expanded tremendously. So when we talk about leasing yes. There are the key legacy retailers will always be a part of our shopping centers, which are also looking at digitally native and emerging brands.

Speaker Change: International brands food and beverage restaurant medical.

Speaker Change: Entertainment.

Electric vehicles fitness home furnishings grocery so.

Jackson Hsieh: So, you know, the uses that we have to choose from are really unprecedented today.

Speaker Change: The uses that we have to choose from a really unprecedented today.

Speaker Change: Thank you.

Ronald Kamdem: And the next question will come from Ronald Kamden with Morgan Stanley.

Speaker Change: And the next question will come from Ronald Camden with Morgan Stanley. Your line is open.

Jackson Hsieh: Your line is open. Hey, just I think the last call you'd mentioned thoughts on the same story and why maybe being flattest for, you know, this year and next, maybe until you sort of get the the lease commencements and so forth. Just curious if we can get an update on that given things are running ahead of plan and in any sort of high level 27, 28 occupancy targets in your mind would also be helpful. Thanks.

Ronald Camden: Hey, just I think the last call you had mentioned thoughts and same store NOI, maybe being flat as far.

Speaker Change: Sharon next maybe until you sort of get.

Speaker Change: The lease commencement and so forth just curious if we can get an update on that given things are running ahead of plan and any sort of high level 2728 occupancy targets in your mind would also be helpful. Thanks.

Jackson Hsieh: Hey Ron, it's Jackson. So, you know, last quarter, you know, when I made reference to the flat , and a wide same store profile. You know, my initial comment was really related to the entire portfolio. You know, as I said, you know, the best indicator of success is our leasing progress. You know, and based on this faster leasing pace on our go forward portfolio, we actually expect same store NOI in our go forward portfolio in 2026 to be in the three to 4% range and significantly higher in 27 and 28. As it relates to physical permanent occupancy, you know, I talked last quarter about roughly being around 84% physical permanent occupancy in our Go Forward portfolio.

Speaker Change: Hey, Ron It's Jackson, so last quarter, when I made reference to the flat.

Speaker Change: NOI same store profile.

Speaker Change: My initial comment was really related to the entire portfolio.

Speaker Change: As I've said the best indicator of success is our Leesville progress.

Speaker Change: And based on this faster leasing pace on a go forward portfolio, we actually expect same store NOI in our go forward portfolio in 2026 to be in the 3% to 4% range.

Speaker Change: Significantly higher in 2007 and 28.

Speaker Change: As it relates to the physical permanent occupancy.

Speaker Change: Talked last quarter about roughly being around 84% physical permanent occupancy in our go forward portfolio.

Jackson Hsieh: At the time, the snow that we talked about last quarter represented about 250 basis points of potential permanent occupancy. So, you know, if we kind of keep at this pace, you sort of should expect us to get, you know, very close to that 89% area of physical permanent occupancy. Plus. 26.

Speaker Change: At the time, the snow that we talked about last quarter represented about 250 basis points of potential permanent occupancy.

Speaker Change: So if.

Speaker Change: If we kind of keep at this pace.

Speaker Change: So that should expect us to get.

Speaker Change: Very close to that 89% area of physical prototyping Betsy.

Speaker Change: Yes.

Speaker Change: 26.

Speaker Change: Anchor locations being fulfilled which.

Speaker Change: Those anchors, we think will generate over 600 managed sales. So we do our work we think we're going to really be able to accelerate the sales productivity and traffic.

Speaker Change: In our centers.

Speaker Change: And thats going to really set ourselves up for some some better re leasing spreads as we get more permanently occupied for the next cycle of lease renewals after 2028.

Jackson Hsieh: Super helpful. Thanks so much.

Speaker Change: Super helpful. Thanks, so much.

Speaker Change: Sure.

Samir Khanal: The next question comes from Samir Khanal with Bank of America. Your line is open. Good morning, everybody. I guess, Jack, I mean, you're certainly making a lot of good progress here, especially on the leasing side. But just, you know, one metric that sort of is lagging or is sort of held constant is sales. I guess, how should we think about your ability to sort of push rents here, especially if sales don't grow? Again, it's good progress made so far, but I just want to get your thoughts on sales here. Thanks.

Speaker Change: The next question comes from Samir Khanal with Bank of America. Your line is open.

Speaker Change: Yeah. Good morning, everybody I guess, Jack I mean, you're certainly making a lot of good progress here.

Speaker Change: Especially on the leasing side, but just one metric that sort of is lagging.

Speaker Change: Sort of held constant as sales.

Speaker Change: I guess, how should we think about your ability to sort of push rents here, especially if sales don't grow them again, it's good progress made so far but just want to get your thoughts on sales here. Thanks.

Jack Hsieh: So I think you've got to sort of trust in the process that we're executing on. You know, when I look at, like, Scottsdale's Fashion Square, that center's doing over a billion dollars in sales. Tyson's is going to do over a billion after we get a couple more. We've got an anchor deal that's approved, but we're in the documentation phase. You know, we've got 26 anchors that are coming online between now and 2028, and an incredible amount of inline permanent occupancy increasing with what I call best in class brands that drive traffic and rent and sales.

Speaker Change: So I think you've got a sort of trust in the process that we're executing Miller.

Speaker Change: <unk>.

Speaker Change: When I look at like Scottsdale fashion Square that center is doing over $1 billion in sales.

Speaker Change: Tysons is going to do over $1 billion. After we get a couple more we've got an anchor deal thats.

Speaker Change: But we're in the documentation phase.

Speaker Change: We've got 26 anchors that are coming online between now and 2028.

Speaker Change: And an incredible amount of inline permanent occupancy increasing with what I would call best in class brands.

Speaker Change: Drive traffic and sales.

Jack Hsieh: So yeah, we're spending a lot of money in the centers, we're not dentifying, we're putting good retail use, and I think that's what's going to really, that gives us the confidence to be able to drive sales productivity. I wouldn't get so worried about this intermediate period on sales. Maybe at some point we'll break down sales in some of our better centers where we've done this type of work, like Tyson's and at Scottsdale, that give us the confidence to know if you do the right things in the centers from a retail standpoint, you get the right result in terms of traffic increase and sales productivity.

Speaker Change: So yes, we are spending a lot of money.

Speaker Change: In centers.

Speaker Change: They're not densify.

Speaker Change: Good retail use.

And I think thats whats going to really that gives us the confidence to be able to drive sales productivity. So.

Speaker Change: I wouldn't get too.

Speaker Change: Worried about.

Speaker Change: This this intermediate period of sales.

Speaker Change: At some point, we'll break down sales and some of our better centers, where we've done this type of work like Tysons at Scottsdale that give us the confidence to know if you do the right things in the center. So retail standpoint, you get the right result in terms of traffic increase in sales productivity.

Jack Hsieh: We're applying that sort of basic strategy across the Goldfarb portfolio.

Speaker Change: And we're applying that that sort of.

Speaker Change: Basic strategy across the <unk>.

Speaker Change: All forward portfolio at this point.

Floris Dijkum: And the next question comes from Floris Van Dijkum with Compass Point. Your line is open. Hey, thanks, guys. My question to you was more, you've identified your Eddies and some of these potential additional sales candidates. Can you quantify to us what percentage of your NOI today is core versus non-core? And maybe talk a little bit about, I think you've indicated that you think your core NOI is going to grow by three to four percent. Is that this year or is that next year? So that's next year on the 3% to 4% on the core Go Forward portfolio.

Speaker Change: And the next question comes from Floris Van <unk> with Compass point Your line is open.

Speaker Change: Hey, Thanks, guys.

Speaker Change: My question to you was more.

Speaker Change: You've identified.

Speaker Change: Eddie or you're in some of these.

Speaker Change: Potential additional sales candidates.

Speaker Change: Can you quantify to us what percentage of your NOI today.

Speaker Change: It is core versus noncore.

Speaker Change: And maybe talk a little bit about I think you've indicated that you think your core NOI is going to grow by 3% to 4% is that this year or is that next year.

Speaker Change: So that's next year on the 3% to 4%.

Speaker Change: On the core go forward portfolio.

Jackson Hsieh: But, Floris, we're going to come out with this NOI bridge in the next two weeks. Like, it's between ICFC and NAIRI. It's going to outline... It, I think, will make this a little bit more clearer and also outline what properties are designated within the GoForward. And I think that, after we do that, it will be more helpful for you all. We can take you through it. Perfect. Thanks.

Speaker Change: But.

Speaker Change: We're going to come out with this NOI bridge.

Speaker Change: Two weeks like it's between ICSC and NAREIT, it's going to outline.

Speaker Change: I think I'll make this a little bit with clearer and also outline what properties are designated within the go forward.

Speaker Change: I think that you have to do that.

Speaker Change: More helpful field.

Speaker Change: We can take you through it.

Speaker Change: Correct.

Speaker Change: Thanks.

Speaker Change: Thank you.

Greg Mcginniss: And our next question comes from Greg McGinniss with Scotiabank. Your line is open. Hey, two questions on the new leasing. Just trying to better understand that kind of speedometer metric, but what percent of total leasing deals do you expect to be new deals in 2025 and 26? How does that compare to the historical average? And then does this, you know, new deals under consideration by the Executive Leasing Committee, is that more retailers looking to locate in Macerich assets? Or is that more of a willingness on your end not to renew tenants, take on the short term vacancy for some longer term?

And our next question comes from Greg Mcginniss with Scotiabank. Your line is open.

Speaker Change: Hey.

Two questions on the new leasing.

Speaker Change: I'm, just trying to better understand that kind of a speedometer metric, but what percent of total leasing deals do you expect to be new deals.

Speaker Change: In 2025, and 26 Hasnt, how does that compare to the historical average and then does this.

Speaker Change: New deals under consideration by the executive leasing committee is that more retailers looking to locate in may search assets or is that more of a willingness on year end not to renew tenants take on the short term vacancy for some longer term gain.

Douglas Healey: I'll take the second question first.

Speaker Change: I'll take the second question first.

Douglas Healey: And then Brad, maybe you can take the first question. But the deals we review in our executive leasing committee are really a combination of new deals and renewal deals. Many are new deals that are just strictly taking vacant space that we've identified. Jack mentioned A, B, and C quality space. We have every single space in our portfolio identified and a rent attributed to it. So we know exactly what we're doing methodically. Are we taking off some space, taking some space offline? Yes. And we do that. That's just normal course of business. We do that to enhance the merchandising of the shopping centers.

Speaker Change: And then Brad maybe you can take the first question, but the deals we review in our executive leasing Committee are really a combination of new deals and renewal deals.

Speaker Change: Many of our new deals that are strictly taking vacant space that we've identified Jack mentioned <unk> quality space. We have every single space in our portfolio identified at a rent attributed to it. So we know exactly what we're doing methodically are we taking off some space taken some space offline yes.

Speaker Change: And we do that that's just normal course of business, we do that to enhance.

Speaker Change: The merchandising of the shopping centers or Jack just alluded to that so really DLC is a combination of both renewal deals and new deals, but I really view it as a forward looking metric that unlike signed leases, which is the stuff we've done in the past what we look at on a biweekly basis is all new.

Douglas Healey: And Jack just alluded to that. So really, ELC is a combination of both renewal deals and new deals. But I really view it as a forward-looking metric that, unlike signed leases, which is the stuff we've done in the past, what we look at on a biweekly basis is all new and really more indicative of what's going on in the present and, more importantly, in the future.

Speaker Change: New and really more indicative of what's going on in the present and more importantly in the future Greg and Greg on the first part of the question.

Brad Miller: Greg, do you want to? And, Greg, on the first part of the question... in 2023. And just as a point in time, we did 4.2 million square feet of leasing. 1.4 million of that square footage was new leases. Now, that was for the entire portfolio. I would say, as they go forward, you should expect our percentage of new to be higher. I'm not going to give you the exact target, but it's going to be higher than that percentage. And we've talked about that, where that's the big opportunity.

Speaker Change: In 2023.

Speaker Change: Just as a point in time, we did $4 2 million square feet of leasing.

Speaker Change: $1 4 billion of that square footage was new leases.

Speaker Change: Now that was for the entire portfolio.

Speaker Change: I would say is the go forward you should expect our percentage of annuity would be higher.

Speaker Change: I can't give you exact target, but it's going to be higher than that percentage.

Speaker Change: We've talked about that we're that's a big opportunity.

Speaker Change: Mhm.

Greg Mcginniss: Okay, if I could just follow up on the development, or the sorry, the redevelopment, just so that the yields fell a bit this quarter looks like a mix of increased project costs and lower rent assumptions.

Speaker Change: And if I could just follow up on the developments I'm sorry, the redevelopments.

Speaker Change: So that the yields fell a bit this quarter. It looks like a mix of increased project costs and lower rent assumptions I was hoping you could give us some more clarity on that.

Greg Mcginniss: Hoping you could give us some more clarity. Yeah, hey, Greg, it's really just the team's just completed their property quarterly reviews. And in going through that process, there were some marginal cost increases at both Flatiron and Greenacres, which are really driving the differences that you'll see in the supplement page on the developer Okay, no risk for further growth beyond that. Now, as we sit here today, based on the latest review of the projects that we just completed over the last couple of weeks.

Speaker Change: Yeah, Hey, Greg It's really just the teams just completed their property quarterly reviews, and then going through that process. There were some marginal.

Speaker Change: Cost increases at both flat iron and Green acres, which are really driving the differences that youll see in the supplement page under development.

Speaker Change: Sure.

Speaker Change: Okay, no risk for further growth beyond that.

Speaker Change: Not as we sit here today based on the latest.

Speaker Change: Review of the projects that we just completed over the last couple of weeks.

Vince Tibone: Okay, thank And the next question comes from Vince Tibone with Green Street. Your line is open. Hi, thank you. Um, could you clarify the differences in the two renewal leasing spread statistics you cited earlier, I believe you said one was 7% and the other was like closer to 1% on a same space basis, but thought for renewals, you know, things should generally be same space. So just we can clarify kind of what's driving the delta there. That'd be helpful.

Thank you.

Speaker Change: <unk>.

Speaker Change: And the next question comes from Vince <unk> with Green Street. Your line is open.

Vince: Hi, Thank you.

Vince: Could you clarify the differences in the two renewal leasing spread statistics you cited earlier I believe you said, one was 7% and the other was like closer to 1% on a same space basis, but tougher renewals now things should generally be same space. So just if you could clarify kind of what's driving the delta there.

Vince: That'd be helpful.

Brad Miller: Hi, it's Brad. I'll take that one. So on the same space spreads, you know, we look at it. It includes temp spaces and who's in the space today. And so it's apples to apples, the exact same space. When we look at the new and renewal, the 22 and the Metric for New Deals, that includes both against the same expiring rent. Yeah, I thought, okay, just I missed here, then I thought it was like one renewal 7%, the other one was 1%. I guess so renewals, it sounds like the 1% figure is the more appropriate like renewal spread on to think about.

Brian: Hi, it's Brian I'll take that one so on the same space spreads we look at it.

Brian: It include tap spaces, and who's in the space today, and so it's apples to apples with the exact same space when we look at the.

Brian: The new and renewal.

Brian: 22 and the.

Brian: Metrics for new deals.

Brian: That includes both against the same expiring rent such as splitting it between the two.

Brian: Yes, Okay I Miss here than I thought there was like one renewal 7%. The other one was 1% so renewals it sounds like the 1% figure is more appropriate.

Brian: Like renewal of Brad on.

Speaker Change: Do you think about.

Brad Miller: Yeah, I would say so. I mean, our renewal spreads are definitely less than our new deal spread. And that's why we're also like that first quarter, we had an anchor renewal. Those are the big things also waiting in that package. Yeah. Got it. So the prior tenant, so it includes anchors, it includes temps. I just want to make sure I understand what's in that metric because I believe that's the first time this has been provided. Correct me if I'm wrong. I think we provided the color last quarter as well in the same space. Okay.

Speaker Change: Yes, I would say so I mean, our renewal spreads are definitely less than our new deal spread and Thats. Why we are so also like our first quarter, we had an anchor renewals.

Speaker Change: Also leading investor package, yes.

Speaker Change: Got it so there and so that is the prior tenant that would include the anchor that include Tam. So I just want to make sure I understand what's in that metric because I believe that is the first time. This has been provided correct me if I'm wrong.

Speaker Change: I think we've provided the color last quarter as well in that same space.

Speaker Change: Okay, well. Thank you no that's helpful.

Brad Miller: Well, thank you. I know that's helpful.

Omoteo Okasana: And the next question will come from Omoteo Okasana with Dorche Bank. Your line is open. Yes, good afternoon. For the same store NOI growth this quarter, could you tell us a little bit in detail about the kind of same store revenues and same store expenses, what what happened in these two, these two items to kind of get to the same store NOI?

And the next question will come from Matteo <unk> with Deutsche Bank. Your line is open.

Matteo: Oh, yes, good afternoon.

Speaker Change: NOI growth this quarter.

Speaker Change: Could you talk a little bit of detail about the kind of same store revenues and same store expense. What happened then was too.

Speaker Change: Just two items to kind of get to the same store NOI.

Dan Swanstrom: Are you referencing for the first quarter of 2025? Yeah, for the first quarter of 2025. And then just trying to understand how you ultimately expect that to change to kind of get to this 3-4% growth we're talking about in 2027. Yeah, in the first I mean, in the first quarter, we did see some operating expense increases. But as I mentioned earlier, the revenue generation was was more than offsetting those shopping center increases. for the first quarter.

Are you referencing for the first quarter of 2025.

Speaker Change: For the first quarter put in 25, and then just trying to understand how you ultimately expect that to change to kind of get to this three 4% growth we're talking about.

Speaker Change: Okay.

Speaker Change: Yes in the first I mean in the first quarter, we did see some operating expense increases, but as I mentioned earlier. The revenue generation was was more than offsetting those shopping center increases.

Speaker Change: For the first quarter.

Dan Swanstrom: And you went out on the second part of your question. You were just talking about the go forward. So it's a different portfolio, that's the problem. Yeah. So, yeah, so, you know, yeah, the first quarter 2025, the current portfolio and the commentary Jack referenced earlier, the 3 to 4% in 2026, that's for the go forward portfolio, which to the earlier comment, we'll be providing more color on the position of that portfolio with our bridge over the next couple of weeks. Sounds good. Thank you.

Speaker Change: You went out on the second part of your question just talking about the go forward. So it's a different portfolio of supply yes.

Speaker Change: So yes, so that's right.

Yes, the first quarter 2025.

Speaker Change: Current portfolio and the commentary Jack referenced earlier, the 3% to 4% in 2026 Thats for the go forward portfolio, which.

Speaker Change: To the earlier comment we will be providing more color on the position of that portfolio with our NOI bridge over the next couple of weeks.

Speaker Change: Sounds good thank you.

Alexander Goldfarb: The next question comes from Alexander Goldfarb with Piper Sandler. Your line is open. Hey, good morning, morning out there.

Speaker Change: The next question comes from Alexander Goldfarb with Piper Sandler Your line is open.

Alexander Goldfarb: Hey, good morning, good morning out there.

Dan Swanstrom: I were were one or two questions. I just want to make sure are we can we ask one or two? Just ask one if you could, and then... Okay, great. Well, then, on the numbers side, there were some items in the first quarter. Maybe you mentioned the legal expense in the opening. I didn't hear it, but there was a lease term fee, and then there was legal expense. And then also, it sounds like there's $21 million of land sales, potentially, in the balance this year in FFO.

Speaker Change: There were one or two questions I just wanted to make sure are we can we ask one or two.

Speaker Change: Just wanted to cut and then okay, great well then.

On the numbers side.

Speaker Change: There were some items in the first quarter.

Speaker Change: Maybe you mentioned the legal expense in the opening I didn't hear it but there was a lease term fee.

Speaker Change: And then there was legal expense and then also it sounds like Theres $21 million of land sales potentially in the balance of this year in <unk>. So just trying to get a better understanding on the on the.

Dan Swanstrom: So just trying to get a better understanding on the legal and lease term in the first quarter, expectations for more lease terms this year, and then land sales that we should expect in FFO for the balance of the year. Yes, sure. So I'll start with the legal claims. As I mentioned, it was six million dollars of net settlement income at one of our properties during the first quarter related to a construction design defect matter. That's one-time in nature. We expect those proceeds received, recovered, will more than be adequate to cover the cost of the proposed solution.

Speaker Change: Legal and lease term in the first quarter expectations for more lease terms. This year and then land sales that we should expect in <unk>.

Speaker Change: <unk> for the balance of the year.

Speaker Change: Yes, sure. So I'll start with the legal claims as I mentioned was $6 million of net settlement income at one of our properties during the first quarter related to a construction design defect matter that's onetime in nature. We expect those proceeds received recovered reward and adequate to cover the cost.

Speaker Change: The proposed solution.

Dan Swanstrom: So we highlighted that as more of a non-recurring one-time item. As it relates to lease termination fees, we had about five million dollars of lease termination fees come through in the first quarter. And that was primarily driven by one large tenant at Fashion Outlets of Chicago, which was a three million dollar amount. And we're pleased that we already have another tenant that has taken that space. So that's good news at that particular asset. And then as it relates to land sales, yeah, we just kind of gave an update that for the first quarter, we closed on seven million of land sales.

Speaker Change: So we highlighted that as more of a nonrecurring one time item as it relates to the lease termination fees, we had about $5 million of lease termination fees come through in the first quarter and that was primarily driven by one large tenant in that fashion outlets of Chicago, which was a $3 million.

Speaker Change: Amount.

Speaker Change: And we're pleased that we already have another tenant that has taken.

Speaker Change: Taking that space.

Speaker Change: So thats good news at that particular asset.

Speaker Change: And then as it relates to.

Speaker Change: Land sales, we just kind of gave an update that for the first quarter. We closed on $7 million of land sales and then in April we closed on the sale of another $25 million of land sales.

Dan Swanstrom: And then in April, we closed on the sale of another 25 million of land sales. So in totality, that's part of our 100 to 150 million dollar bucket, which in combination with the out parcels were now 77 million sold against that 100 to 150 million dollar target.

Speaker Change: So in totality that's.

Speaker Change: Part of our $100 million to $150 million bucket, which in combination with the out parcels, where now $77 million sold against that 100 $150 million target.

Speaker Change: Okay.

Dan Swanstrom: and then expectations for lease terms for the balance of the year. You know, we expect, you know, maybe a couple more million dollars of lease termination income in the balance of the year based on the visibility we have today. Okay, thank you.

Speaker Change: And then expectations for lease terms for the balance of the year.

Speaker Change: We expect.

Speaker Change: Maybe a couple more million dollars of lease termination income and the balance of the year based on the visibility we have today.

Speaker Change: Okay. Thank you.

Speaker Change: Yes.

Haendel St. Juste: The next question comes from Haendel St. Juste with Mizzou.

Speaker Change: The next question comes from Hendel, St. Joseph with Mizuho. Your line is open.

Jack Hsieh: Your line is open. Hey, guys. Good morning out there. Appreciate the comments on the tariffs not impacting leasing, but I guess I'm curious on how tariffs might be impacting the conversations around some of the asset sale that you're doing here. I understand Lakewood is the last sizable asset you have left to sell, but what can you tell us about the pricing, the demand for Lakewood, any color on that, and potentially a sense of when you expect that to close? Yeah, well, you know, in Lakewood, as we referenced, you know, the proceeds over the debt amount are not very significant.

Speaker Change: Hey, guys good morning out there.

Hendel: The comment on the tariffs not impacting leasing, but I guess I'm curious on how tariffs might be impacting the conversation is around some of the asset sale.

Speaker Change: Youre doing here I understand.

Liquid is the last sizeable asset you have left to sell but what can you tell us about the pricing.

Speaker Change: And for Lakewood, I mean, any color on that and potentially a sense of when do you expect that to close.

Speaker Change: Yes.

Speaker Change: As we referenced.

Speaker Change: Proceeds of the debt about R. R.

Speaker Change: Not very significant so.

Jack Hsieh: So, you know, the borrower is going through a process right now with the existing lender, the buyer. I would say, you know, as it relates to debt financing, I mean, I think Washington Square is a great example of refinancing stabilized vaults that, you know, Dan can give you more color. on the outparsel. You know, some of the cap rates on the restaurants were like in the 5%, mid 5% range. You know, we're seeing really, you know, these are high network buyers, 1031 buyers, you know, Haendel did a lot of this at our own company, Xperit.

Speaker Change: The borrowers going through a process right now.

Speaker Change: With the existing lender.

Speaker Change: The buyer.

Speaker Change: I would say.

Speaker Change: As it relates to debt financings I mean, I think Washington Square is a great example of refinancings stabilized malls.

Speaker Change: Dan can give you more color.

Speaker Change: On the out parcels.

Speaker Change: Some of the cap rates on the restaurants, where like in that 5% mid 5% range.

Speaker Change: We're seeing really nice.

Speaker Change: And these are high net worth buyers 10 31 buyers.

Speaker Change: And I did a lot of this at our all company at Spirit.

Jack Hsieh: And so, if you ask me, on our out-of-parcel objectives... I think we laid out 500 million of out parcels, so roughly 8%. I think we're going to do better than that. I think it's going to probably be closer to 7%. And I think we're going to end up maybe even doing more if we want, because we'll identify more vacant land opportunities that quite candidly, on a price per acre, is a lot more valuable than what we did at Santan. And so, yeah, I think I feel really good about that piece of the...

Speaker Change: And so he asked me on our out parcel objective.

Speaker Change: I think we laid out $500 million of out parcels at roughly 8% I think we're going to do better than that things can probably be closer to 7%.

Speaker Change: And I think we're going to end up maybe even do a walk we want because we have identified more vacant land opportunity that can't quite candidly on a price per acre is a lot more valuable than what we did at Santana and so yes, I think feel really good about that piece of that.

Jack Hsieh: The execution is left. Okay, any ballpark on NOI yield or any stat on the pricing for the liquid from a value perspective, given the space where we don't see a lot of trade? I would just look at the debt yield that we've put in the supplemental, you know, in our disclosure that it's pretty good approximation for a cap rate.

Speaker Change: Execution is left.

Speaker Change: Okay.

Speaker Change: Any ballpark on.

NOI yield there any stat on the pricing for the liquid.

Speaker Change: From a value perspective given.

Speaker Change: The space, where we don't see a lot of fish rates.

Speaker Change: I would just look at the debt yield that we've put in the sub.

Speaker Change: Supplemental disclosure, that's probably a good approximation for the cap rate there.

Dan Swanstrom: Okay, fine. And then maybe one more, if I could, just appreciate the color and all the numbers you guys provided, lots of numbers, but I guess if I'm curious, I'm curious if we should be reading into your comments that, you know, the mid-26 inflection, if that's when we should be thinking about cash flow or earnings to be troughing and then to inflect positively from that point. Thank you. Yeah, Haendel, I think that's a fair characterization of it, just as Jack mentioned, you know, as we have a lot of leasing activity coming online over the next couple of years, development NOI really starts to ramp second half of 26 into 27 and 28.

Speaker Change: Okay, and then maybe one more if I could just I appreciate the color and all the numbers you guys provided lots of numbers, but I guess, if I'm curious I am curious if we should be reading into your comments that the mid 'twenty six inflection.

Speaker Change: If that's when we should be thinking about cash flow or earnings to be trough thing and then to inflect positively positively from that point. Thank you.

Andrew: Yes, Andrew I think Thats fair.

Speaker Change: Fair.

Jack: Characterization of it just as Jack mentioned, we have a lot of leasing activity.

Jack: Coming online over the next couple of years development NOI really starts to ramp second half of 26%, 27% and 28.

Dan Swanstrom: And then on the flip side, you know, we're working through these out parcel sales and asset sales and givebacks, so it's possible that the NOI, lost NOI from those, you know, could be more than what's coming online from the sources coming in over that next 12 to 18 month period. So that's a long way of saying I think your statement is fair. Okay, appreciate it, guys. Thank you.

Jack: Then on the flip side, we're working through these out parcel sales and asset sales and get back. So it's possible that the NOI lost NOI from those.

Jack: It could be more.

Jack: Then what's coming online from the sources coming in over the next 12 to 18 month period.

Jack: That's a long way of saying that I think your statement is fair.

Jack: Okay I appreciate it guys. Thank you.

Caitlin Burrows: The next question comes from Caitlin Burrows with Goldman Sachs. Your line is open. We take that all into consideration in our 500 basis points of increase, any fallout from planned closures. It's all weighed into that five.

Speaker Change: The next question comes from Caitlin Burrows with Goldman Sachs. Your line is open.

Caitlin Burrows: Hi, Good morning, there I guess, just thinking about the long term plan and the targets in terms of reaching the physical permanent occupancy targets by 2028, which I think was up about 500 basis points from year end 24, I'm wondering if you could go through what kind of leakage or tenant fallout nonrenewals that sort of thing you are assuming on the other side I guess one concern.

Speaker Change: Is that a new forever 21, or someone like that comes along and creates a new hole to fill so just wondering.

Speaker Change: Kind of how that factored into your occupancy targets and outlooks.

Speaker Change: We think that all into consideration in our 500 basis points of increase any fallout from plant closures in the times that were replacing is all weighed into that five basis points.

Caitlin Burrows: Okay, thanks.

Speaker Change: Okay. Thanks.

Michael Mueller: And our next question will come from Michael Mueller with J.P. Morgan. Your line is open. Yeah, hi. For the Forever 21 releasings, what portion of that activity is going to single users, as opposed to breaking up the spaces for smaller tenants? I can take that one, Michael. It's really a mixed bag. I would say that the majority of the space is being leased as it is. Some of the larger anchor store spaces that Forever 21 took may get broken up. But as I mentioned, we're about 50% committed. And we're going to basically double the rent that Forever 21 was paying.

Speaker Change: And our next question will come from Michael Mueller with JP Morgan Your line is open.

Speaker Change: Yes, Hi, just for the Forever 21, releasing what portion of that activity is going to single use single users as opposed to breaking up the spaces for smaller tenants.

Doug: I can take that one Michael it's Doug.

Doug: It's really a mixed bag I would say that the majority of this space is being leased as it is some of the larger anchor store spaces that forever 21 took may get broken up but as I mentioned were about 56% about 50% committed and we're going to basically doubled.

Doug: The rent that forever 21 was paying and while we're not at liberty to disclose.

Douglas Healey: And while we're not at liberty to disclose or talk about the replacement deals yet, you should be thinking about some of the real, real hot tenants that are out there right now. And this is really an opportunity for us to be able to get these underperforming stores back. And then think about like Dick's House of Sport, or Zara, or Primark, or Uniqlo, or Urban Planet replacing them. There's just so much upside not only in the rent, but in terms of merchandising as well.

Doug: Or talk about that.

Doug: The replacement deals yet you should be thinking about some of the real real hot tenants that are out there right now I mean this is this is really <unk>.

Doug: <unk> for us to be able to get these underperforming stores back and then think about like VIX houses sport or zara, or prime mark or uniqlo or urban planet, replacing them.

Doug: So much upside not only in the rent book by in terms of merchandising as well.

Operator: Thanks.

Doug: Thanks.

Jack Hsieh: I am showing this is all the time that we have now for questions.

Doug: I am showing this is all the time that we have now for questions I would now like to turn the call back to Jack <unk> for closing remarks.

Jack Hsieh: I would now like to turn the call back to Jack Hsieh for closing remarks. Thank you, and we're pleased to report our continued progress on the many strategic initiatives within our Path Forward Plan, and we thank you all for your time today.

Jack: Yeah. Thank you and we're pleased to report our continued progress on many strategic initiatives within our path forward plan and we thank you all for your time today.

Operator: This concludes today's conference call. Thank you for participating. You may now disconnect. I'm trying to wait.

Speaker Change: This concludes today's conference call. Thank you for participating you may now disconnect.

Speaker Change: We'll find a way to go.

Speaker Change: Okay.

Speaker Change: Sure.

Speaker Change:

Operator: Thanks for watching!

Speaker Change: [music].