CBL & ASSOCIATES PROPERTIES INC

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of financial condition and results of operations should be read in conjunction with the consolidated financial statements and accompanying notes that are included in this annual report. Capitalized terms used, but not defined, in this Management’s Discussion and Analysis of Financial Condition and Results of Operations have the same meanings as defined in the notes to the consolidated financial statements.

Executive Overview

We are a self-managed, self-administered, fully integrated REIT that is engaged in the ownership, development, acquisition, leasing, management and operation of regional shopping malls, outlet centers, lifestyle centers, open-air centers and other properties. As of December 31, 2024, we own interests in 87 properties, consisting of 45 malls, 27 open-air centers, five outlet centers, five lifestyle centers and five other properties, including single-tenant and multi-tenant outparcels. As of December 31, 2024, our shopping centers are located in 21 states, and are primarily in the southeastern and midwestern United States. We have elected to be taxed as a REIT for federal income tax purposes.

We conduct substantially all our business through the Operating Partnership. The Operating Partnership consolidates the financial statements of all entities in which it has a controlling financial interest or where it is the primary beneficiary of a VIE. See Item 2 for a description of our properties owned and under development as of December 31, 2024.

The following summarizes our net income (loss) and net income (loss) attributable to common shareholders (in thousands):

Significant items that affected comparability between the years include:

•

Items increasing net income for the year ended December 31, 2024 compared to the year ended December 31, 2023 include:

o

Depreciation and amortization was $49.9 million lower;

o

Gain on consolidation was $26.7 million higher;

o

Interest expense was $18.4 million lower;

o

Equity in earnings was $11.1 million higher;

o

Gain on sales of real estate assets was $11.6 million higher;

o

Real estate taxes were $7.4 million lower; and

o

Maintenance and repairs were $3.6 million lower.

•

Items decreasing net income for the year ended December 31, 2024 compared to the year ended December 31, 2023 include:

o

Gain on deconsolidation was $47.9 million lower;

o

Rental revenues were $20.1 million lower;

o

Gain on extinguishment of debt was $4.1 million lower; and

o

General and administrative expense was $3.2 million higher.

•

Items increasing net income for the year ended December 31, 2023 compared to the year ended December 31, 2022 include:

o

Depreciation and amortization was $65.8 million lower;

o

Interest expense was $44.4 million lower;

o

Gain on deconsolidation was $11.6 higher;

o

Interest and other income was $8.3 million higher; and

o

General and administrative expense was $3.1 million lower.

•

Items decreasing net income for the year ended December 31, 2023 compared to the year ended December 31, 2022 include:

o

Rental revenues were $28.3 million lower;

o

Equity in earnings was $7.9 million lower; and

o

Gain on extinguishment of debt was $4.1 million lower.

Our focus is on continuing to execute our strategy to improve occupancy, drive rent growth and transform the offerings available at our properties to include a targeted mix of retail, service, dining, entertainment and other non-retail uses, primarily through the re-tenanting of former anchor locations as well as diversification of in-line tenancy. This operational strategy is also supported by our balance sheet strategy of reducing overall debt, extending our debt maturity schedule and lowering our overall cost of borrowings to limit maturity risk, as well as improving net cash flow and enhancing enterprise value. While the industry and our Company continue to face challenges, some of which may not be in our control, we believe that the strategies in place to improve occupancy, diversify our tenant mix and redevelop our properties will continue to contribute to stabilization of our portfolio and revenues in future years.