SITE Centers Corp. (NYSE:SITC), an owner of open-air shopping centers in suburban, high household income communities, announced today operating results for the quarter ended September 30, 2023.

"Third quarter results reflect a continuation of year-to-date trends including steady demand for vacant space in the Company's supply constrained markets and recycling of capital from highly leased properties into Convenience assets," commented David R. Lukes, President and Chief Executive Officer. "Rent commencements, the backfill of vacant space from bankruptcies and tactical redevelopment deliveries remain significant tailwinds for SITE Centers going forward."

Results for the Quarter

Third quarter net income attributable to common shareholders was $45.9 million, or $0.22 per diluted share, as compared to net income of $63.4 million, or $0.30 per diluted share, in the year-ago period. The decrease year-over-year primarily was the result of lower income from joint ventures as a result of asset sales in the third quarter of 2022, partially offset by higher gain on sale from asset sales, property net operating income ("NOI") growth and the net impact of property acquisitions.
Third quarter operating funds from operations attributable to common shareholders ("Operating FFO" or "OFFO") was $69.9 million, or $0.33 per diluted share, compared to $62.8 million, or $0.29 per diluted share, in the year-ago period primarily due to property NOI growth and the net impact of property acquisitions. Third quarter OFFO included $8.1 million, or $0.04 per diluted share, of income related to below-market lease adjustments primarily for terminated Bed, Bath & Beyond leases.

Significant Third Quarter and Recent Activity

SITE Centers sold 11 wholly owned shopping centers in the third quarter and fourth quarter to date for an aggregate price of $645.6 million including five wholly-owned shopping centers during the third quarter for an aggregate price of $118.3 million.
Acquired three convenience shopping centers during the quarter for an aggregate price of $28.1 million, including Towne Crossing Shops (Richmond, VA) for $4.2 million, Oaks at Slaughter (Austin, TX) for $14.1 million and Marketplace at 249 (Houston, TX) for $9.8 million.
In the third quarter, recorded a $1.3 million charge related to the previously announced restructuring plan, which included a Voluntary Retirement Offer. The balance of the total charges is expected to be incurred in the fourth quarter of 2023. Restructuring charges have been excluded from OFFO.
In October, closed on a five-year, $100 million mortgage secured by Nassau Park Pavilion (Princeton, NJ).
In October, acquired two convenience shopping centers for an aggregate price of $26.0 million, including Estero Crossing (Fort Myers, FL) for $17.1 million and Point at University (Charlotte, NC) for $8.9 million.

Key Quarterly Operating Results

Reported an increase of 2.9% in same-store net operating income ("SSNOI") on a pro rata basis for the third quarter of 2023, including redevelopment, as compared to the year-ago period. The impact of prior period rental income receipts related to cash basis tenants was immaterial to third quarter 2023 SSNOI growth.
Generated cash new leasing spreads of 37.7% and cash renewal leasing spreads of 7.3%, both on a pro rata basis, for the trailing twelve-month period ended September 30, 2023 and cash new leasing spreads of 58.2% and cash renewal leasing spreads of 6.6%, both on a pro rata basis, for the third quarter of 2023.
Generated straight-lined new leasing spreads of 50.9% and straight-lined renewal leasing spreads of 11.5%, both on a pro rata basis, for the trailing twelve-month period ended September 30, 2023 and straight-lined new leasing spreads of 73.0% and straight-lined renewal leasing spreads of 10.2%, both on a pro rata basis, for the third quarter of 2023.

Reported a leased rate of 94.6% at September 30, 2023, compared to 95.5% at June 30, 2023 and 95.0% at September 30, 2022, all on a pro rata basis. The sequential decline was primarily related to the recapture of the remaining units leased by Bed, Bath & Beyond and the sale of properties in the third quarter with an average leased rate of 98.5%, partially offset by new leasing activity.
As of September 30, 2023, the Signed Not Opened ("SNO") spread was 260 basis points, representing $17.9 million of annualized base rent on a pro rata basis.

Guidance

The Company has updated its 2023 full-year guidance for net income attributable to common shareholders and Operating FFO per share to reflect third quarter results and announced transaction activity. Impairment charges, gains on sale of interests and assets, transaction and debt extinguishment costs are excluded from guidance. The guidance update is as follows:

Reconciliation of Net Income Attributable to Common Shareholders to FFO and Operating FFO estimates:

	FY 2023E (prior) Per Share – Diluted	FY 2023E (revised) Per Share – Diluted
Net income attributable to Common Shareholders	$0.11 – $0.19	$0.28 – $0.33
Depreciation and amortization of real estate	0.96 – 1.00	0.97 – 1.00
Equity in net (income) of JVs	(0.03)	(0.03)
JVs' FFO	0.04	0.04
Gain on disposition of real estate (reported actual)	—	(0.15)
Gain on sale and change in control of interests (reported actual)	(0.02)	(0.02)
FFO (NAREIT)	$1.10 – $1.14	$1.12 – $1.14
Transaction, debt extinguishment and other at SITE share (reported actual)	—	0.01
Separation and other charges	0.03	0.03
Operating FFO	$1.13 – $1.17	$1.16 – $1.18

In reliance on the exception provided by Item 10(e)(1)(i)(B) of Regulation S-K, reconciliation of the assumed range of 2023 SSNOI growth to the most directly comparable GAAP financial measure is not provided because the Company is unable to provide such reconciliation without unreasonable effort due to the multiple components of the calculation which only includes properties owned for comparable periods and excludes all corporate level activity as described below under Non-GAAP Measures and Other Operational Metrics. Key assumptions for 2023 guidance include the following:

	FY 2023E (prior)	FY 2023E (revised)
Joint Venture fee income	$5 – $7 million	$6 – $7 million
SSNOI (1)	0.00% – 3.00%	1.50% – 3.00%
SSNOI – Adjusted for 2022 Uncollectible Revenue Impact (2)	1.00% – 4.00%	2.50% – 4.00%

(1)		Including redevelopment for assets owned as of September 30, 2023 and approximately $3.4 million included in Uncollectible Revenue, primarily related to rental income from cash basis tenants, reported in 2022 related to prior periods, which is an approximately 100 basis-point headwind to 2023 SSNOI growth.
(2)		Including redevelopment for assets owned as of September 30, 2023 and excluding revenue impact of approximately $3.4 million included in Uncollectible Revenue, primarily related to rental income from cash basis tenants, reported in 2022 related to prior periods.

About SITE Centers Corp.

SITE Centers is an owner and manager of open-air shopping centers located in suburban, high household income communities. The Company is a self-administered and self-managed REIT operating as a fully integrated real estate company, and is publicly traded on the New York Stock Exchange under the ticker symbol SITC. Additional information about the Company is available at www.sitecenters.com. To be included in the Company's e-mail distributions for press releases and other investor news, please click here.

Conference Call and Supplemental Information

The Company will hold a conference call to discuss quarterly results and other business updates today at 5:30 p.m. Eastern Time. All interested parties can access the call by dialing 888-317-6003 (U.S.), 866-284-3684 (Canada), or 412-317-6061 (international) using passcode 5228692. The call will also be webcast and available in a listen-only mode on SITE Centers' website at ir.sitecenters.com. SITE Centers no longer intends to host its previously announced earnings conference call on November 2, 2023. Copies of the Company's supplemental package are available on the Company's website.

Non-GAAP Measures and Other Operational Metrics

Funds from Operations ("FFO") is a supplemental non-GAAP financial measure used as a standard in the real estate industry and is a widely accepted measure of real estate investment trust ("REIT") performance. Management believes that both FFO and Operating FFO provide additional indicators of the financial performance of a REIT. The Company also believes that FFO and Operating FFO more appropriately measure the core operations of the Company and provide benchmarks to its peer group.

FFO is generally defined and calculated by the Company as net income (loss) (computed in accordance with generally accepted accounting principles in the United States ("GAAP")), adjusted to exclude (i) preferred share dividends, (ii) gains and losses from disposition of real estate property and related investments, which are presented net of taxes, (iii) impairment charges on real estate property and related investments, (iv) gains and losses from changes in control and (v) certain non-cash items. These non-cash items principally include real property depreciation and amortization of intangibles, equity income (loss) from joint ventures and equity income (loss) from non-controlling interests and adding the Company's proportionate share of FFO from its unconsolidated joint ventures and non-controlling interests, determined on a consistent basis. The Company's calculation of FFO is consistent with the definition of FFO provided by NAREIT. The Company calculates Operating FFO as FFO excluding certain non-operating charges, income and gains. Operating FFO is useful to investors as the Company removes non-comparable charges, income and gains to analyze the results of its operations and assess performance of the core operating real estate portfolio. Other real estate companies may calculate FFO and Operating FFO in a different manner.

In calculating the expected range for or amount of net (loss) income attributable to common shareholders to estimate projected FFO and Operating FFO for future periods, the Company does not include a projection of gain and losses from the disposition of real estate property, potential impairments and reserves of real estate property and related investments, debt extinguishment costs and certain transaction costs. Other real estate companies may calculate expected FFO and Operating FFO in a different manner.

The Company also uses net operating income ("NOI"), a non-GAAP financial measure, as a supplemental performance measure. NOI is calculated as property revenues less property-related expenses. The Company believes NOI provides useful information to investors regarding the Company's financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level and, when compared across periods, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and disposition activity on an unleveraged basis.

The Company presents NOI information herein on a same store basis or "SSNOI." The Company defines SSNOI as property revenues less property-related expenses, which exclude straight-line rental income and reimbursements and expenses, lease termination income, management fee expense, fair market value of leases and expense recovery adjustments. SSNOI includes assets owned in comparable periods (15 months for prior period comparisons). In addition, SSNOI is presented including activity associated with redevelopment. SSNOI excludes all non-property and corporate level revenue and expenses. Other real estate companies may calculate NOI and SSNOI in a different manner. The Company believes SSNOI at its effective ownership interest provides investors with additional information regarding the operating performances of comparable assets because it excludes certain non-cash and non-comparable items as noted above.

FFO, Operating FFO, NOI and SSNOI do not represent cash generated from operating activities in accordance with GAAP, are not necessarily indicative of cash available to fund cash needs and should not be considered as alternatives to net income computed in accordance with GAAP, as indicators of the Company's operating performance or as alternatives to cash flow as a measure of liquidity. Reconciliations of these non-GAAP measures to their most directly comparable GAAP measures have been provided herein. In reliance on the exception provided by Item 10(e)(1)(i)(B) of Regulation S-K, reconciliation of the assumed rate of 2023 SSNOI growth to the most directly comparable GAAP financial measure is not provided because the Company is unable to provide such reconciliation without unreasonable effort due to the multiple components of the calculation which only includes properties owned for comparable periods and excludes all corporate level activity as noted above.

The Company calculates Cash Leasing Spreads by comparing the prior tenant's annual base rent in the final year of the prior lease to the executed tenant's annual base rent in the first year of the executed lease. Straight-Lined Leasing Spreads are calculated by comparing the prior tenant's average base rent over the prior lease term to the executed tenant's average base rent over the term of the executed lease. For both Cash and Straight-Lined Leasing Spreads, the reported calculation includes only comparable leases which are deals executed within one year of the date that the prior tenant vacated. Deals executed after one year of the date the prior tenant vacated, deals which are a combination of existing units, new leases at redevelopment properties, and deals for units vacant at the time of acquisition are considered non-comparable and excluded from the calculation.

Safe Harbor

SITE Centers Corp. considers portions of the information in this press release to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to the Company's expectation for future periods. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not historical fact may be deemed to be forward-looking statements. There are a number of important factors that could cause our results to differ materially from those indicated by such forward-looking statements, including, among other factors, general economic conditions, including inflation and interest rate volatility; local conditions such as the supply of, and demand for, retail real estate space in our geographic markets; the impact of e-commerce; dependence on rental income from real property; the loss of, significant downsizing of or bankruptcy of a major tenant and the impact of any such event on rental income from other tenants and our properties; redevelopment and construction activities may not achieve a desired return on investment; our ability to buy or sell assets on commercially reasonable terms; our ability to secure equity or debt financing on commercially acceptable terms or at all; impairment charges; valuation and risks relating to our joint venture investments; the termination of any joint venture arrangements or arrangements to manage real property; property damage, expenses related thereto and other business and economic consequences (including the potential loss of rental revenues) resulting from extreme weather conditions or natural disasters in locations where we own properties, and the ability to estimate accurately the amounts thereof; sufficiency and timing of any insurance recovery payments related to damages from extreme weather conditions or natural disasters; any change in strategy; the impact of pandemics and other public health crises; unauthorized access, use, theft or destruction of financial, operations or third party data maintained in our information systems or by third parties on our behalf; our ability to maintain REIT status; and the finalization of the financial statements for the period ended September 30, 2023. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements, please refer to the Company's most recent reports on Forms 10-K and 10-Q. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

SITE Centers Corp.
Income Statement: Consolidated Interests

	in thousands, except per share
		3Q23	3Q22	9M23	9M22
	Revenues:
	Rental income (1)	$142,498	$135,123	$414,324	$401,210
	Other property revenues	588	1,067	1,978	3,164
		143,086	136,190	416,302	404,374
	Expenses:
	Operating and maintenance	20,986	22,314	66,628	66,528
	Real estate taxes	20,543	20,423	60,875	61,230
		41,529	42,737	127,503	127,758

	Net operating income (2)	101,557	93,453	288,799	276,616

	Other income (expense):
	JV and other fee income	1,673	2,653	5,307	9,471
	Interest expense	(21,147)	(20,139)	(61,991)	(57,306)
	Depreciation and amortization	(52,821)	(51,179)	(165,535)	(152,564)
	General and administrative (3)	(11,259)	(10,799)	(35,935)	(34,403)
	Other income (expense), net	(690)	(501)	(2,011)	(2,152)
	Impairment charges	0	0	0	(2,536)
	Income before earnings from JVs and other	17,313	13,488	28,634	37,126

	Equity in net income of JVs	518	25,918	6,495	27,468
	Gain on sale and change in control of interests	0	228	3,749	45,554
	Gain on disposition of real estate, net	31,047	26,837	31,230	31,292
	Tax expense	(236)	(258)	(811)	(863)
	Net income	48,642	66,213	69,297	140,577
	Non-controlling interests	0	(18)	(18)	(55)
	Net income SITE Centers	48,642	66,195	69,279	140,522
	Preferred dividends	(2,789)	(2,789)	(8,367)	(8,367)
	Net income Common Shareholders	$45,853	$63,406	$60,912	$132,155

	Weighted average shares – Basic – EPS	209,286	213,846	209,505	213,278
	Assumed conversion of diluted securities	113	482	241	582
	Weighted average shares – Diluted – EPS	209,399	214,328	209,746	213,860

	Earnings per common share – Basic	$0.22	$0.30	$0.29	$0.62
	Earnings per common share – Diluted	$0.22	$0.30	$0.29	$0.62

(1)	Rental income:
	Minimum rents	$89,717	$89,686	$267,713	$261,849
	Ground lease minimum rents	6,296	6,733	19,108	20,191
	Straight-line rent, net	496	921	2,160	2,454
	Amortization of (above)/below-market rent, net	9,223	1,189	12,099	3,407
	Percentage and overage rent	1,095	797	4,498	3,582
	Recoveries	34,753	33,214	104,570	99,811
	Uncollectible revenue	(811)	(381)	(1,126)	1,889
	Ancillary and other rental income	1,511	1,619	4,716	4,416
	Lease termination fees	218	1,345	586	3,611

(2)	Includes NOI from WO assets sold in 3Q23	1,645	N/A	N/A	N/A

(3)	Separation charge and other	1,086	0	4,014	0

SITE Centers Corp.
Reconciliation: Net Income to FFO and Operating FFO
and Other Financial Information

	in thousands, except per share
		3Q23	3Q22	9M23	9M22
	Net income attributable to Common Shareholders	$45,853	$63,406	$60,912	$132,155
	Depreciation and amortization of real estate	51,412	49,925	161,480	148,828
	Equity in net income of JVs	(518)	(25,918)	(6,495)	(27,468)
	JVs' FFO	2,145	1,271	6,327	9,469
	Non-controlling interests	0	18	18	55
	Impairment of real estate	0	0	0	2,536
	Gain on sale and change in control of interests	0	(228)	(3,749)	(45,554)
	Gain on disposition of real estate, net	(31,047)	(26,837)	(31,230)	(31,292)
	FFO attributable to Common Shareholders	$67,845	$61,637	$187,263	$188,729
	Separation and other charges	1,345	0	4,444	0
	Transaction, debt extinguishment and other (at SITE's share)	679	1,196	2,186	2,501
	RVI disposition fees	0	0	0	(385)
	Total non-operating items, net	2,024	1,196	6,630	2,116
	Operating FFO attributable to Common Shareholders	$69,869	$62,833	$193,893	$190,845

	Weighted average shares & units – Basic: FFO & OFFO	209,286	213,987	209,571	213,419
	Assumed conversion of dilutive securities	113	341	241	441
	Weighted average shares & units – Diluted: FFO & OFFO	209,399	214,328	209,812	213,860

	FFO per share – Basic	$0.32	$0.29	$0.89	$0.88
	FFO per share – Diluted	$0.32	$0.29	$0.89	$0.88
	Operating FFO per share – Basic	$0.33	$0.29	$0.93	$0.89
	Operating FFO per share – Diluted	$0.33	$0.29	$0.92	$0.89
	Common stock dividends declared, per share	$0.13	$0.13	$0.39	$0.39

	Capital expenditures (SITE Centers share):
	Redevelopment costs	7,609	4,606	15,726	16,451
	Maintenance capital expenditures	4,528	6,480	11,552	16,467
	Tenant allowances and landlord work	13,187	13,739	38,939	35,340
	Leasing commissions	1,861	1,642	6,255	6,010
	Construction administrative costs (capitalized)	795	939	2,395	3,085

	Certain non-cash items (SITE Centers share):
	Straight-line rent	516	906	2,236	2,611
	Straight-line fixed CAM	94	114	238	325
	Amortization of (above)/below-market rent, net	9,314	1,287	12,364	3,683
	Straight-line ground rent expense	(25)	(34)	(130)	(100)
	Debt fair value and loan cost amortization	(1,165)	(1,340)	(3,591)	(3,854)
	Capitalized interest expense	321	341	916	808
	Stock compensation expense	(1,756)	(1,694)	(5,119)	(5,135)
	Non-real estate depreciation expense	(1,411)	(1,256)	(4,064)	(3,742)

SITE Centers Corp.
Balance Sheet: Consolidated Interests

	$ in thousands
		At Period End
		3Q23	4Q22
	Assets:
	Land	$1,082,330	$1,066,852
	Buildings	3,717,850	3,733,805
	Fixtures and tenant improvements	597,874	576,036
		5,398,054	5,376,693
	Depreciation	(1,730,179)	(1,652,899)
		3,667,875	3,723,794
	Construction in progress and land	62,809	56,466
	Real estate, net	3,730,684	3,780,260

	Investments in and advances to JVs	40,830	44,608
	Cash	26,560	20,254
	Restricted cash	36,701	960
	Receivables and straight-line (1)	65,192	63,926
	Intangible assets, net (2)	92,127	105,945
	Other assets, net	33,028	29,064
	Total Assets	4,025,122	4,045,017

	Liabilities and Equity:
	Revolving credit facilities	135,000	0
	Unsecured debt	1,368,282	1,453,923
	Unsecured term loan	198,772	198,521
	Secured debt	38,100	54,577
		1,740,154	1,707,021
	Dividends payable	30,100	30,389
	Other liabilities (3)	208,151	214,985
	Total Liabilities	1,978,405	1,952,395

	Preferred shares	175,000	175,000
	Common shares	21,437	21,437
	Paid-in capital	5,972,902	5,974,216
	Distributions in excess of net income	(4,067,355)	(4,046,370)
	Deferred compensation	5,053	5,025
	Accumulated comprehensive income	12,055	9,038
	Common shares in treasury at cost	(72,375)	(51,518)
	Non-controlling interests	0	5,794
	Total Equity	2,046,717	2,092,622

	Total Liabilities and Equity	$4,025,122	$4,045,017

(1)	SL rents (including fixed CAM), net	$35,718	$33,879

(2)	Operating lease right of use assets	17,665	18,197

(3)	Operating lease liabilities	37,375	37,777
	Below-market leases, net	48,833	59,825

SITE Centers Corp.
Reconciliation of Net Income Attributable to SITE to Same Store NOI

$ in thousands
	3Q23	3Q22	3Q23	3Q22
	SITE Centers at 100%		At SITE Centers Share (Non-GAAP)
GAAP Reconciliation:
Net income attributable to SITE Centers	$48,642	$66,195	$48,642	$66,195
Fee income	(1,673)	(2,653)	(1,673)	(2,653)
Interest expense	21,147	20,139	21,147	20,139
Depreciation and amortization	52,821	51,179	52,821	51,179
General and administrative	11,259	10,799	11,259	10,799
Other expense (income), net	690	501	690	501
Equity in net income of joint ventures	(518)	(25,918)	(518)	(25,918)
Tax expense	236	258	236	258
Gain on sale and change in control of interests	0	(228)	0	(228)
Gain on disposition of real estate, net	(31,047)	(26,837)	(31,047)	(26,837)
Income from non-controlling interests	0	18	0	18
Consolidated NOI	101,557	93,453	101,557	93,453
Less: Non-Same Store NOI adjustments			(12,271)	(6,602)
Total Consolidated SSNOI			89,286	86,851

Consolidated SSNOI % Change			2.8%

Net income from unconsolidated joint ventures	1,545	105,872	487	21,272
Interest expense	5,668	8,241	1,314	1,831
Depreciation and amortization	7,806	9,450	1,849	2,156
Impairment charges	0	9,010	0	1,802
Other expense (income), net	2,084	6,120	481	1,286
Gain on disposition of real estate, net	(973)	(119,813)	(195)	(23,963)
Unconsolidated NOI	$16,130	$18,880	3,936	4,384
Less: Non-Same Store NOI adjustments			(101)	(781)
Total Unconsolidated SSNOI at SITE share			$3,835	$3,603

Unconsolidated SSNOI % Change			6.4%

SSNOI % Change at SITE Share			2.9%

SITE Centers Corp.
Reconciliation of Net Income Attributable to SITE to Same Store NOI

$ in thousands
	9M23	9M22	9M23	9M22
	SITE Centers at 100%		At SITE Centers Share (Non-GAAP)
GAAP Reconciliation:
Net income attributable to SITE Centers	$69,279	$140,522	$69,279	$140,522
Fee income	(5,307)	(9,471)	(5,307)	(9,471)
Interest expense	61,991	57,306	61,991	57,306
Depreciation and amortization	165,535	152,564	165,535	152,564
General and administrative	35,935	34,403	35,935	34,403
Other expense (income), net	2,011	2,152	2,011	2,152
Impairment charges	0	2,536	0	2,536
Equity in net income of joint ventures	(6,495)	(27,468)	(6,495)	(27,468)
Tax expense	811	863	811	863
Gain on sale and change in control of interests	(3,749)	(45,554)	(3,749)	(45,554)
Gain on disposition of real estate, net	(31,230)	(31,292)	(31,230)	(31,292)
Income from non-controlling interests	18	55	18	55
Consolidated NOI	288,799	276,616	288,799	276,616
Less: Non-Same Store NOI adjustments			(25,710)	(20,747)
Total Consolidated SSNOI			$263,089	$255,869

Consolidated SSNOI % Change			2.8%

Net income from unconsolidated joint ventures	22,172	105,833	4,724	21,887
Interest expense	19,016	26,560	4,342	5,982
Depreciation and amortization	25,149	37,123	5,878	8,304
Impairment charges	0	17,550	0	3,510
Other expense (income), net	7,022	11,114	1,593	2,468
Gain on disposition of real estate, net	(21,151)	(121,505)	(4,232)	(24,254)
Unconsolidated NOI	$52,208	$76,675	12,305	17,897
Less: Non-Same Store NOI adjustments			(1,124)	(6,969)
Total Unconsolidated SSNOI at SITE share			$11,181	$10,928

Unconsolidated SSNOI % Change			2.3%

SSNOI % Change at SITE Share			2.8%

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