BRANDYWINE REALTY TRUST

1. ORGANIZATION OF THE PARENT COMPANY AND THE OPERATING PARTNERSHIP

Brandywine Realty Trust (the “Parent Company”) is a self-administered and self-managed real estate investment trust (“REIT”) engaged in the acquisition, development, redevelopment, ownership, management, and operation of a portfolio of office and mixed-use properties. The Parent Company owns its assets and conducts its operations through Brandywine Operating Partnership, L.P. (the “Operating Partnership”) and subsidiaries of the Operating Partnership. The Parent Company is the sole general partner of the Operating Partnership and, as of March 31, 2025, owned a 99.7% interest in the Operating Partnership. The Parent Company’s common shares of beneficial interest (“common shares”) are publicly traded on the New York Stock Exchange under the ticker symbol “BDN.” The Parent Company, the Operating Partnership, and their consolidated subsidiaries are collectively referred to as the “Company.”

As of March 31, 2025, the Company owned and consolidated 64 properties that contain an aggregate of approximately 12.1 million net rentable square feet (collectively, the “Properties”). The Company’s core portfolio of operating properties (the “Core Properties”) exclude properties under development or redevelopment properties, recently completed - not stabilized properties, and properties held for sale. The Properties were comprised of the following as of March 31, 2025:

(a)The Company reclassifies a Property from “development/redevelopment property” to “recently completed – not-stabilized property” after the date that the development or redevelopment of the Property is placed in service and prior to the time that the Property reaches at least 90% occupancy. At such time as the Property reaches at least 90% occupancy it is considered stabilized. Then the Company reclassifies the Property as a “Core Property.”

In addition to the Properties, as of March 31, 2025, the Company owned 130.6 acres of land held for development. The Company also held a leasehold interest inone land parcel totaling 0.8 acres, acquired through a prepaid 99-year ground lease, and held options to purchase approximately 5.1 additional acres of undeveloped land. As of March 31, 2025, the total potential development that this inventory of land could support under current zoning and entitlements, including the parcels under option, amounted to an estimated 11.9 million net rentable square feet.

As of March 31, 2025, the Company also owned economic interests innine unconsolidated real estate ventures (see Note 4“Investment in Unconsolidated Real Estate Ventures,” for further information). The Properties and the properties owned by the unconsolidated real estate ventures are primarily located in or near Philadelphia, Pennsylvania; Austin, Texas; Metropolitan Washington, D.C.; Southern New Jersey; and Wilmington, Delaware.

The Company conducts its third-party real estate management services business primarily through wholly-owned management company subsidiaries. As of March 31, 2025, the management company subsidiaries were managing properties containing an aggregate of approximately 19.4 million net rentable square feet, of which approximately 12.1 million net rentable square feet related to Properties owned by the Company and approximately 7.3 million net rentable square feet related to properties owned by the unconsolidated real estate ventures.

Unless otherwise indicated, all references in this Form 10-Q to square feet and net rentable square feet represent net rentable area.

2. BASIS OF PRESENTATION

Basis of Presentation

The consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments consist solely of normal recurring matters, and result in a fair statement of the financial position of the Company as of March 31, 2025, the results of its operations for the three months ended March 31, 2025 and 2024 and its cash flows for the three months ended March 31, 2025 and 2024. The results of operations for such interim periods are not necessarily indicative of the results for a full year. These consolidated financial statements should be read in conjunction with the Parent Company’s and the Operating Partnership’s consolidated financial statements and footnotes included in their combined Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 27, 2025.

The consolidated balance sheet at December 31, 2024 has been derived from the audited financial statements as of that date but does not include all the information and footnotes required by GAAP for complete financial statements. The Company’s Annual Report on Form 10-K for the year ended December 31, 2024 contains a discussion of the Company’s significant accounting policies under Note 2, “Summary of Significant Accounting Policies”. There have been no material changes in the Company’s significant accounting policies since December 31, 2024.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The estimates and assumptions include, but are not limited to, the amount and timing of development/redevelopment costs and of Company obligations for such costs, including costs incurred through unconsolidated real estate ventures. The estimates and assumptions for development/redevelopment cost are highly judgmental, cover significant future time horizons and are sensitive to cost escalations, sales price escalations and timing and pricing of leasing activity, all of which may be affected by expectations about future market or economic conditions. Actual results could differ from these and other estimates.

Recent Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280). The new standard requires enhanced disclosures about significant segment expenses and other segment items and requires companies to disclose all annual disclosures about segments in interim periods. The new standard also permits companies to disclose more than one measure of segment profit or loss, requires disclosure of the title and position of the Chief Operating Decision Maker, and requires companies with a single reportable segment to provide all disclosures required by Topic 280. The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company's adoption of the standard did not have a material impact on the Company's consolidated financial statements.

3. REAL ESTATE INVESTMENTS

As of March 31, 2025 and December 31, 2024, the gross carrying value of the Properties, reflected in the line item “Operating properties” in the Company's consolidated balance sheets, was as follows (in thousands):

Net gain on disposition of real estate

During first quarter of 2025, the Company recognized a gain of $3.1 million from installment proceeds received from the buyer of a property, located in Philadelphia, Pennsylvania, that the Company sold in March 2017. In March 2017, the Company sold the property for a gross sales price of $21.4 million. At the settlement, the Company received a partial payment of $12.0 million and recognized a corresponding gain on sale of $6.5 million. The remainder of the payment of $9.4 million was deferred and was initially contingent upon termination or expiration of a lease at the property with an existing tenant. In 2024, the deferred contingent payment obligation was changed to a fixed payment obligation, and the $6.3 million remaining deferred payment, together with interest thereon at 11% per annum, is due in February 2026 and will be recognized as a gain if and when cash is received.

4. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

As of March 31, 2025, the Company held ownership interests innine unconsolidated real estate ventures, with a net aggregate investment balance of $570.4 million. As of March 31, 2025, four of the real estate ventures owned properties (directly or through leasehold interests) that contained an aggregate of approximately 4.3 million net rentable square feet of office space; one of the real estate ventures directly owns one property with 341 rentable residential units; one of the real estate ventures directly owns a mixed use building featuring 0.2 million square feet of office space and 326 rentable residential units; two of the real estate ventures owned 1.4 acres of land held for development; andone of the real estate ventures owned land in active development.

The Company accounts for its interests in the unconsolidated real estate ventures, which range from 20% to 85%, using the equity method. Certain of the unconsolidated real estate ventures are subject to specified priority allocations of distributable cash, including cash from operations and cash from capital events, such as sales of properties.

The Company earned management fees from the unconsolidated real estate ventures of $1.0 million and $1.9 million for the three months ended March 31, 2025 and 2024, respectively.

The Company earned leasing commissions from the unconsolidated real estate ventures of $1.5 million and $0.6 million for the three months ended March 31, 2025 and 2024, respectively.

The Company had outstanding accounts receivable balances from the unconsolidated real estate ventures of $5.8 million and $5.0 million as of March 31, 2025 and December 31, 2024, respectively.

The amounts reflected in the following tables (except for the Company’s share of equity in income) are based on the financial information of the individual unconsolidated real estate ventures.

The following is a summary of the financial position of the unconsolidated real estate ventures in which the Company held interests as of March 31, 2025 and December 31, 2024 (in thousands):

(a)This amount does not include the effect of the basis difference between the Company’s historical cost basis and the basis recorded at the real estate venture level, which is typically amortized over the life of the related assets and liabilities. Basis differentials occur from the impairment of investments, purchases of third-party interests in existing real estate ventures and upon the transfer of assets that were previously owned by the Company into a real estate venture. In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the real estate venture level.

The following is a summary of results of operations of the unconsolidated real estate ventures in which the Company held interests during the three-month periods ended March 31, 2025 and 2024 (in thousands):

(a)Excludes amounts related to the Herndon Innovation Center Metro Portfolio Venture, LLC and the New MAP Venture as the Company discontinued applying the equity method of accounting. The Company discontinued applying the equity method of accounting on the Herndon Innovation Center

Metro Portfolio Venture, LLC after March 31, 2024 and has no further investments in Herndon Innovation Center as of December 31, 2024. The Company discontinued applying the equity method of accounting on the New MAP Venture after June 30, 2024. As of June 30, 2024, the Company's investment in the New MAP Venture waszero, and the Company discontinued applying the equity method of accounting on the New MAP Venture.

KB JV

On June 28, 2024, the Company formed an unconsolidated real estate venture, KB JV, LLC (the "KB JV"), which acquired leasehold interests in 14 properties, located in Richmond, Virginia, from a different unconsolidated real estate venture of the Company, the MAP Venture, for $26.0 million. The Company and an unaffiliated third party each owned a 50% equity interest in the KB JV and the portfolio assets were unencumbered by third party debt. In connection with the formation of KB JV and its purchase of the 14 properties, the KB JV loaned $13.0 million to the Company. The loan from the KB JV was classified within“Unsecured term loans, net” on the consolidated balance sheet.

On December 20, 2024, the KB JV sold its entire interest in the 14 properties for $66.8 million, generating approximately $15.5 million of net proceeds to the Company for its 50% ownership interest in the KB JV, after repayment of the above-referenced $13.0 million loan. As of March 31, 2025, the KB JV has ceased operations and the Company has no further investments in the KB JV.

5. LEASES

Lessor Accounting

The table below sets forth the allocation of lease revenue between fixed contractual payments and variable lease payments for the three months ended March 31, 2025 and 2024 (in thousands):

6. INTANGIBLE ASSETS AND LIABILITIES

As of March 31, 2025 and December 31, 2024, the Company’s intangible assets/liabilities were comprised of the following (in thousands):

As of March 31, 2025, the Company’s annual amortization for its intangible assets/liabilities, assuming no early lease terminations, was as follows (dollars in thousands):

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7. DEBT OBLIGATIONS

The following table sets forth information regarding the Company’s consolidated debt obligations outstanding as of March 31, 2025 and December 31, 2024 (in thousands):

(a)Spread includes a 10 basis point daily SOFR adjustment.

(b)On November 23, 2022, the $250.0 million unsecured term loan was swapped to a fixed rate. At March 31, 2025, the fixed rate for this instrument was 5.41% and matures on June 30, 2027. The effective date of the swap was January 31, 2023.

(c)During the third quarter of 2023, Moody’s downgraded the Company's senior unsecured credit rating from Baa3 to Ba1. As a result of the downgrade, the interest rate on the Company's 7.55% Guaranteed Notes due 2028 (the "2028 Notes") increased 25 basis points in September 2023 due to the coupon adjustment provisions within the 2028 Notes. During the first quarter of 2024, S&P downgraded the Company's senior unsecured credit rating from BBB- to BB+. As a result of the downgrade, the interest rate on the 2028 Notes increased 25 basis points to 8.05% in March 2024 due to the coupon adjustment provisions within the 2028 Notes. During the second quarter of 2024, Moody's downgraded the Company's senior unsecured credit rating from Ba1 to Ba2. As a result of the downgrade, the interest rate on the 2028 Notes increased 25 basis points to 8.30% in April 2024 due to the coupon adjustment provisions within the 2028 Notes.

(d)On January 16, 2024, the Trust Preferred I Indenture IA was swapped to a fixed rate at 5.14% for the period from March 30, 2024 to December 30, 2026 and Trust Preferred I Indenture IB and Trust Preferred II Indenture II were swapped to a fixed rate at 5.24% for the period from January 30, 2024 to January 30, 2027.

The Company utilizes borrowings under its unsecured credit facility (the “Unsecured Credit Facility”) for general business purposes, including to fund costs of acquisitions, developments and redevelopments of properties, and to fund share repurchases and repay other debt. The Unsecured Credit Facility provides for borrowings of up to $600.0 million and the per annum variable interest rate on borrowings is SOFR plus 1.40% plus a spread adjustment of 0.10%. The interest rate and facility fee are subject to adjustment upon a change in the Company’s unsecured debt ratings. During the three months ended March 31, 2025, the weighted-average interest rate on Unsecured Credit Facility borrowings was 5.83%, resulting in $0.4 million of interest expense for such period.

Unsecured Term Loan

On March 1, 2023, the Company entered into an unsecuredone-year term loan agreement in the aggregate principal amount of $70.0 million (the “2023 Term Loan”). The 2023 Term Loan was scheduled to mature on February 28, 2024. In January 2024, the Company executed its option to extend for an additional twelve months to February 28, 2025 upon customary terms and conditions. The 2023 Term Loan bore interest at Daily Simple SOFR plus 1.90% with a 0.10% SOFR adjustment per year and was interest-only (payable monthly) through the maturity date. The Company repaid the loan on its maturity date of February 28, 2025.

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Additional Information on Unsecured and Secured Consolidated Debt

The Parent Company unconditionally guarantees the unsecured debt obligations of the Operating Partnership (or is a co-borrower with the Operating Partnership) but does not by itself incur unsecured indebtedness. The Parent Company has no material assets other than its investment in the Operating Partnership.

The Company was in compliance with all financial covenants as of March 31, 2025. Certain of the covenants restrict the Company’s ability to obtain alternative sources of capital.

As of March 31, 2025, the aggregate scheduled principal payments on the Company’s consolidated debt obligations (secured and unsecured) were as follows (in thousands):

8. FAIR VALUE OF FINANCIAL INSTRUMENTS

Financial assets and liabilities recorded on the Company's consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:

•Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access;

•Level 2 inputs are inputs, other than quoted prices included in Level 1, which are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals; and

•Level 3 inputs are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions, as there is little, if any, related market activity or information.

The Company determined the fair values disclosed below using available market information and discounted cash flow analyses as of March 31, 2025 and December 31, 2024, respectively. The discount rate used in calculating fair value is the sum of the current risk free rate and the risk premium on the date of measurement of the instruments or obligations. Considerable judgment is necessary to interpret market data and to develop the related estimates of fair value. Accordingly, the estimates presented are not necessarily indicative of the amounts that the Company could realize upon disposition. The use of different estimates and valuation methodologies may have a material effect on the fair value amounts shown. The Company believes that the carrying amounts reflected in the consolidated balance sheets at March 31, 2025 and December 31, 2024 approximate the fair values for cash and cash equivalents, accounts receivable, other assets and liabilities, accounts payable and accrued expenses because they are short-term in duration. The following are financial instruments for which the Company’s estimates of fair value differ from the carrying amounts (in thousands):

(a)Net of deferred financing costs of $8.9 million and $9.5 million for unsecured notes payable, $0.9 million and $1.1 million for variable rate debt and $2.2 million and $2.4 million for secured fixed rate debt as of March 31, 2025 and December 31, 2024.

The Company used quoted market prices as of March 31, 2025 and December 31, 2024 to value the unsecured notes payable and, as such, categorized them as Level 2.

The inputs utilized to determine the fair value of the Company’s variable rate and fixed rate debt are categorized as Level 3. The fair value of the variable rate and fixed rate debt was determined using a discounted cash flow model that considered borrowing rates available to the Company for loans with similar terms and characteristics.

For the Company’s Level 3 financial instruments for which fair value is disclosed, an increase in the discount rate used to determine fair value would result in a decrease to the fair value. Conversely, a decrease in the discount rate would result in an increase to the fair value.

Disclosure about the fair value of financial instruments is based upon pertinent information available to management as of March 31, 2025 and December 31, 2024. Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts were not comprehensively revalued for purposes of these financial statements since March 31, 2025. Current estimates of fair value may differ from the amounts presented herein.

9. DERIVATIVE FINANCIAL INSTRUMENTS

The following table summarizes the terms and fair values of the Company’s derivative financial instruments as of March 31, 2025 and December 31, 2024. The notional amounts provide an indication of the extent of the Company’s involvement in these instruments at that time, but do not represent exposure to credit, interest rate or market risks (amounts presented in thousands).

(a)Hedging unsecured variable rate debt.

The Company measures its derivative instruments at fair value and records them in “Other assets” and “Other liabilities” on the Company’s consolidated balance sheets.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. The Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. As a result, the Company has determined that the inputs utilized to determine the fair value of derivative instruments are classified in Level 2 of the fair value hierarchy.

10. LIMITED PARTNERS’ NONCONTROLLING INTERESTS IN THE PARENT COMPANY

Noncontrolling interests in the Parent Company’s financial statements relate to redeemable common limited partnership interests in the Operating Partnership held by parties other than the Parent Company and properties which are consolidated but not wholly-owned by the Operating Partnership.

Operating Partnership

The aggregate book value of the noncontrolling interests associated with the redeemable common limited partnership units in the accompanying consolidated balance sheet of the Parent Company was $3.0 million and $3.1 million as of March 31, 2025 and December 31, 2024, respectively. Under the applicable accounting guidance, the redemption value of the redeemable common limited partnership units is carried at fair value. The aggregate settlement value of these units (based on the number of units outstanding and the average closing price of the common shares during the last five business days of the quarter ended March 31, 2025) was approximately $2.3 million and $2.9 million as of March 31, 2025 and December 31, 2024, respectively.

11. BENEFICIARIES’ EQUITY OF THE PARENT COMPANY

Earnings per Share (EPS)

The following table details the number of shares and net income used to calculate basic and diluted earnings per share (in thousands, except share and per share amounts; results may not add due to rounding):

Redeemable common limited partnership units totaling 515,595 at March 31, 2025 and March 31, 2024 were excluded from the diluted earnings per share computations because they are not dilutive.

Unvested restricted shares are considered participating securities which require the use of the two-class method for the computation of basic and diluted earnings per share. For the three months ended March 31, 2025 and 2024, earnings representing nonforfeitable dividends as noted in the table above were allocated to the unvested restricted shares issued to the Company’s executives and other employees under the Company’s shareholder-approved long-term equity incentive plan.

Common Shares

On February 19, 2025, the Parent Company declared a distribution of $0.15 per common share, totaling $26.5 million, which was paid on April 17, 2025 to shareholders of record as of April 3, 2025.

The Parent Company maintains a common share repurchase program under which the Board of Trustees has authorized the Parent Company to repurchase its common shares. On January 3, 2019, the Board of Trustees authorized the repurchase of up to $150.0 million of the Company's common shares from and after January 3, 2019. During the three months ended March 31, 2025 and March 31, 2024, the Company didnot repurchase any common shares under the program.

12. PARTNERS’ EQUITY OF THE PARENT COMPANY

Earnings per Common Partnership Unit

The following table details the number of units and net income used to calculate basic and diluted earnings per common partnership unit (in thousands, except unit and per unit amounts; results may not add due to rounding):

Unvested restricted units are considered participating securities which require the use of the two-class method for the computation of basic and diluted earnings per unit. For the three months ended March 31, 2025 and 2024, earnings representing nonforfeitable dividends were allocated to the unvested restricted units issued to the Parent Company’s executives and other employees under the Parent Company’s shareholder-approved long-term incentive plan.

Common Partnership Units

On February 19, 2025, the Operating Partnership declared a distribution of $0.15 per common partnership unit, totaling $0.1 million, which was paid on April 17, 2025 to unitholders of record as of April 3, 2025.

In connection with the Parent Company’s common share repurchase program, one common unit of the Operating Partnership is retired for each common share repurchased. During the three months ended March 31, 2025 and March 31, 2024, the Company didnot repurchase any units under the program.

13. SHARE BASED COMPENSATION

Restricted Share Unit Awards

As of March 31, 2025,2,857,692 restricted share rights and units (“Restricted Share Units”) were outstanding under the Company’s long term equity incentive plan. These Restricted Share Units vest overone tothree years from the initial grant dates. The remaining compensation expense to be recognized with respect to these awards at March 31, 2025 was $2.5 million and is expected to be recognized over a weighted average remaining vesting period of 1.43 years. During the three months ended March 31, 2025 and 2024, the amortization related to outstanding Restricted Share Units was $4.1 million (of which $0.6 million was capitalized) and $3.9 million (of which $0.7 million was capitalized), respectively. Compensation expense related to outstanding Restricted Share Units is included in general and administrative expense.

The following table summarizes the Company’s Restricted Share Units activity during the three months ended March 31, 2025:

On February 28, 2025, the Compensation Committee of the Parent Company’s Board of Trustees awarded to officers of the Company an aggregate of 995,552 Restricted Share Units, which vest over three years from the grant date. Each Restricted Share Unit entitles the holder toone common share upon settlement. The Parent Company pays dividend equivalents on the

Restricted Share Units prior to the settlement date. Vesting and/or settlement would accelerate if the recipient of the award were to die, become disabled or, in the case of certain of such Restricted Share Units, retire in a qualifying retirement prior to the vesting or settlement date. Qualifying retirement generally means the recipient’s voluntary termination of employment after reaching at least age 57 and accumulating at least 15 years of service with the Company. In addition, vesting would also accelerate if the Parent Company were to undergo a change of control and, on or before the first anniversary of the change of control, the recipient’s employment were to cease due to a termination without cause or resignation with good reason.

The Restricted Share Units granted in 2025, 2024, 2023 and 2022 to certain senior executives include an “outperformance feature” whereby additional shares may be earned, up to 275% of the shares subject to the basic award, based on the Company’s achievement of earnings-based targets and capital markets based targets during athree-year performance period with an additional 366 days of service generally required to fully vest. In addition to the basic award, up to an aggregate of 2,170,708,2,669,293,925,642, and 406,179 shares may be awarded under the outperformance feature for the 2025, 2024, 2023, and 2022 awards, respectively, to those senior officers whose Restricted Share Units awards include the “outperformance feature.” As of March 31, 2025, the Company hasnot recognized any compensation expense related to the outperformance feature for the 2025 awards and has recognized $5.7 million, $4.2 million and $2.1 million related to the outperformance feature for the 2024, 2023 and 2022 awards, respectively. The Company will continue to evaluate progression towards achievement of the performance metrics on a quarterly basis and recognize compensation expense for the outperformance feature of these awards should it be determined that achievement of these metrics is probable.

In addition, on February 28, 2025, the Compensation Committee awarded non-officer employees an aggregate of 122,926 Restricted Share Units that generally vest inthree equal annual installments. Vesting of these awards is subject to acceleration upon death, disability or termination without cause withinone year following a change of control.

In accordance with the accounting standard for share-based compensation, the Company amortizes share-based compensation costs through the qualifying retirement dates for those executives who meet the conditions for qualifying retirement during the scheduled vesting period and whose award agreements provide for vesting upon a qualifying retirement or qualifying retirement eligibility.

Restricted Performance Share Unit Awards

The Compensation Committee of the Parent Company’s Board of Trustees has granted performance share-based awards (referred to as Restricted Performance Share Units, or RPSUs) to officers of the Parent Company. The RPSUs are settled in common shares, with the number of common shares issuable in settlement varying between zero and 200%, with respect to the 2023 award, andzero and 240%, with respect to the 2024 and 2025 awards, of the target amount based on the achievement of certain performance or market conditions. For 2023 awards, the number of shares issuable is determined based on the Company’s total shareholder return over specified measurement periods compared to total shareholder returns of comparative groups over the measurement periods (“Relative TSR”). For the 2025 and 2024 awards, the number of common shares issuable is determined based on the Company’s achievement of certain operating metrics during three one-year performance periods, subject to further adjustment based on Relative TSR for thethree-year term of the award. The table below presents certain information as to unvested RPSU awards.

The Company values each RPSU on its grant date using a Monte Carlo simulation. The fair values of each award are being amortized over thethree-year performance period. If an award's service inception date precedes the grant date, we initially measure compensation expense for awards with performance conditions at fair value at the service inception date based on probability of payout, and we remeasure compensation expense at subsequent reporting dates until all of the award’s key terms and conditions are known and the grant date is established. We amortize awards with performance conditions using the graded expense method for retirement eligible employees.

For 2023 awards, the performance period will be abbreviated and the determination and delivery of earned shares will be accelerated in the event of a change in control or if the recipient of the award were to die, become disabled or retire in a qualifying retirement prior to the end of the otherwise applicable three-year performance period; provided that, in the case of qualifying retirement, the number of shares deliverable will be pro-rated based on the portion of the performance period actually worked before retirement.

For 2024 and 2025 awards, the Company awarded 1,251,803 and 995,552 RPSUs of which 375,968 and 331,851 are treated as granted in 2025, respectively. The determination and delivery of earned shares will be accelerated in the event of a change in control or the award recipient’s death before the end of the full three-year term of the award. If the award recipient’s service ceases due to his or her qualifying retirement or disability during the term of the award, the award will remain outstanding and be earned based on actual performance for the full term of the award, subject to pro-ration based on the portion of the term actually worked. Dividend equivalents will be credited as additional RPSUs during the term of the awards, subject to the same terms and conditions as the original RPSUs.

For the three months ended March 31, 2025, the Company recognized amortization of the 2025, 2024 and 2023 RPSU awards of $2.2 million, of which $0.0 million was capitalized consistent with the Company’s policies for capitalizing eligible portions of employee compensation. For the three months ended March 31, 2024, amortization for the 2024, 2023 and 2022 RPSU awards was $1.4 million, of which $0.2 million was capitalized consistent with the Company’s policies for capitalizing eligible portions of employee compensation.

The remaining compensation expense to be recognized with respect to the non-vested RPSUs at March 31, 2025 was approximately $9.1 million and is expected to be recognized over a weighted average remaining vesting period of 1.9 years.

The Company issued 364,588 common shares on February 1, 2025 in settlement of RPSUs that had been awarded on March 3, 2022 (with athree-year measurement period ended December 31, 2024). Holders of these RPSUs also received a cash dividend of $0.15 per share for these common shares on January 23, 2025.

14. SEGMENT INFORMATION

As of March 31, 2025, the Company owns and manages properties within four segments: (1) Philadelphia Central Business District (“Philadelphia CBD”), (2) Pennsylvania Suburbs, (3) Austin, Texas and (4) Other. The Philadelphia CBD segment includes properties located in the City of Philadelphia, Pennsylvania. The Pennsylvania Suburbs segment includes properties in Chester, Delaware, and Montgomery counties in the Philadelphia suburbs. The Austin, Texas segment includes properties in the City of Austin, Texas. The Other segment includes properties located in the District of Columbia, Northern Virginia, Southern Maryland, Camden County, New Jersey and New Castle County, Delaware. In addition to thefour segments, the corporate group is responsible for cash and investment management, development/redevelopment of certain real estate properties during the construction period, and certain other general support functions. Land held for development and construction in progress is transferred to operating properties by region upon completion of the associated construction or project.

The Company’s segments are based on the Company’s method of internal reporting, which classifies the Company's operations by geographic area. The following tables provide selected asset information and results of operations of the Company’s reportable segments (in thousands):

Net operating income:

(a)Includes property operating expenses, real estate taxes and third-party management expense.

Net operating income (“NOI”) is a non-GAAP financial measure, which we define as total revenue less property operating expenses, real estate taxes and third-party management expenses. Property operating expenses that are included in determining NOI consist of costs that are necessary and allocable to our operating properties such as utilities, property-level salaries, repairs and maintenance, property insurance and management fees. General and administrative expenses that are not reflected in NOI primarily consist of corporate-level salaries, amortization of share awards and professional fees that are incurred as part of corporate office management. NOI presented by the Company may not be comparable to NOI reported by other companies that define NOI differently. NOI is the primary measure that is used by the Company’s management to evaluate the operating performance of the Company’s real estate assets by segment. The Company believes NOI provides useful information to investors regarding the financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level. While NOI is a relevant and widely used measure of operating performance of real estate investment trusts, it does not represent cash flow from operations or net income as defined by GAAP and should not be considered as an alternative to those measures in evaluating our liquidity or operating performance. NOI does not reflect interest expenses, real estate impairment losses, depreciation and amortization costs, capital expenditures and leasing costs. The Company believes that net income (loss), as defined by GAAP, is the most appropriate earnings measure. The following is a reconciliation of consolidated net income (loss), as defined by GAAP, to consolidated NOI, (in thousands):

15. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company is involved from time to time in litigation on various matters, including disputes with tenants, vendors and disputes arising out of agreements to purchase or sell properties. Given the nature of the Company’s business activities, these lawsuits are considered routine to the conduct of its business. The result of any particular lawsuit cannot be predicted, because of the very nature of litigation, the litigation process and its adversarial nature, and the jury system. The Company will establish reserves for specific legal proceedings when it determines that the likelihood of an unfavorable outcome is probable and when the amount of loss is reasonably estimable. The Company does not expect that the liabilities, if any, that may ultimately result from such legal actions will have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company.

Environmental

As an owner of real estate, the Company is subject to various environmental laws of federal, state, and local governments. The Company’s compliance with existing laws has not had a material adverse effect on its financial condition and results of operations, and the Company does not believe it will have a material adverse effect in the future. However, the Company cannot predict the impact of unforeseen environmental contingencies or new or changed laws or regulations on its current Properties or on properties that the Company may acquire.

Debt Guarantees and Equity Funding Commitments

As of March 31, 2025, the Company’s unconsolidated real estate ventures had aggregate indebtedness of $764.1 million. These loans are generally mortgage loans or secured construction loans, most of which are nonrecourse to the Company, except for customary recourse carve-outs. In addition, during construction undertaken by the unconsolidated real estate ventures, including the 3025 JFK Venture, the 3151 Market Street Venture, and the One Uptown Ventures, the Company has provided, and expects to continue to provide, cost overrun and completion guarantees, as well as customary environmental indemnities and guarantees of customary exceptions to nonrecourse provisions in loan agreements.

In accordance with the agreement with its partner in the 3025 JFK Venture, the Company provided cost overrun and completion guarantees for the project developed by the 3025 JFK Venture. With respect to the construction loan obtained by 3025 JFK Venture on July 23, 2021 which matures on July 22, 2025 (subject to aone-year extension option), the Company also provided a carry guarantee and limited payment guarantee up to 25% of the principal balance of the $186.7 million construction loan.

In accordance with the agreement with its partner in the 3151 Market Street Venture, which was formed in July 2022, the Company provided cost overrun and completion guaranties for the development of the project undertaken by this venture. The project was substantially completed in the fourth quarter of 2024. Development costs totaled approximately $316.9 million. As of March 31, 2025, the Company had funded approximately $210.6 million of the development costs, with the balance of the development costs funded by the Company’s partner in the venture. The original 2022 budget for this development contemplated receipt of third party secured financing for approximately 50% of the development costs and equity funding for the balance of the costs, with 65% of the balance to be funded by the Company and 35% of the balance to be funded by the partner. As of the date of this Form 10-Q, no such third party secured financing has been obtained and the partner funded $49.9 million in fulfillment of its total capital commitment. The venture continues to seek third party secured financing, with the aim of using proceeds from such financing to return to the Company approximately $52.1 million on account of the Company’s funding of development costs in excess of its initial capital commitment. There can be no assurance that financing will be obtained or that all or any portion of the proceeds of such financing will be used to fund a return of capital to the Company.

With respect to the One Uptown Ventures, the Company has provided completion guarantees and environmental indemnities in favor of its partner. In addition, the Company has provided completion guarantees, environmental indemnities and guarantees of exceptions to nonrecourse loan provisions in favor of the lenders for the One Uptown Ventures. Moreover, the Company has provided, in favor of the lenders, carry guarantees and limited payment guarantees up to 30% and 15% of the principal balance of the $121.7 million (office) and $85.0 million (multifamily) construction loans, respectively.

The Company has agreed, pursuant to the leasehold mortgage loan to the New MAP Venture, to fund up to an additional $12.0 million for tenant and capital improvements pursuant to leases that the Company proposes, in its discretion, to enter into at the properties owned (through leasehold interests) by the New MAP Venture, which amounts, when funded, will accrue interest at 8.0% per annum. As of March 31, 2025, the Company has not funded any amounts on account of the foregoing commitment.

Impact of Natural Disasters and Casualty

The Company carries liability insurance to mitigate its exposure to certain losses, including those relating to property damage. The Company records the estimated amount of expected insurance proceeds for property damage and other losses incurred as an asset (typically a receivable from the insurer) and income up to the amount of the losses incurred when receipt of insurance proceeds is deemed probable. Any amount of insurance recovery in excess of the amount of the losses is considered a gain contingency and is not recorded until the proceeds are received.

Other Commitments or Contingencies

In connection with the Schuylkill Yards Project, the Company entered into a neighborhood engagement program and, as of March 31, 2025, had $5.0 million of future fixed contractual obligations. The Company also committed to fund additional contributions under the program. As of March 31, 2025, the Company estimates that these additional contributions, which are not fixed under the terms of agreement, will be $2.0 million.

The Company has committed to contribute $15.0 million to a venture capital fund that invests in early-stage life science companies. As of March 31, 2025, the Company had funded $2.8 million of the foregoing commitment.

The Company invests in its properties and regularly incurs capital expenditures in the ordinary course of business to maintain the properties. The Company believes that such expenditures enhance its competitiveness. The Company also enters into construction, utility and service contracts in the ordinary course of business which may extend beyond one year. These contracts typically provide for cancellation with insignificant or no cancellation penalties.