Macerich Co. Q2 2024 Update

TL;DR

Macerich Q2 revenue down slightly, operations continue.

AI Summary

Macerich Co. reported its Q2 2024 results, with total revenue for the quarter ending June 30, 2024, showing a slight decrease compared to the same period in 2023. The company's financial filings for the period indicate ongoing operations in real estate and management services.

Why It Matters

This filing provides insight into the financial performance of a major real estate investment trust, impacting investors and the retail real estate sector.

Risk Assessment

Risk Level: medium — Real estate investment trusts are sensitive to economic downturns and interest rate fluctuations.

Key Numbers

• 2024-06-30 — Reporting Period End Date (Indicates the end of the fiscal quarter for which financial data is reported.)
• 2024-08-08 — Filing Date (The date the 10-Q report was officially submitted to the SEC.)
• 2023-12-31 — Previous Fiscal Year End (Provides a reference point for year-over-year comparisons.)

Key Players & Entities

• MACERICH CO (company) — Filer
• 20240630 (date) — Period of Report
• 20240808 (date) — Filing Date
• 401 WILSHIRE BLVD STE 700 (address) — Business Address
• SANTA MONICA (location) — City

FAQ

Key Financial Figures

• $0.01 — ange on which registered Common Stock, $0.01 Par Value MAC New York Stock Exchange

Filing Documents

• mac-20240630.htm (10-Q) — 1791KB
• mac-20240630x10qexhibit311.htm (EX-31.1) — 10KB
• mac-20240630x10qexhibit312.htm (EX-31.2) — 10KB
• mac-20240630x10qexhibit321.htm (EX-32.1) — 6KB
• 0000912242-24-000125.txt ( ) — 10791KB
• mac-20240630.xsd (EX-101.SCH) — 79KB
• mac-20240630_cal.xml (EX-101.CAL) — 125KB
• mac-20240630_def.xml (EX-101.DEF) — 436KB
• mac-20240630_lab.xml (EX-101.LAB) — 874KB
• mac-20240630_pre.xml (EX-101.PRE) — 680KB
• mac-20240630_htm.xml (XML) — 1705KB

Financial Information

Part I Financial Information Item 1.

Financial Statements (Unaudited)

Financial Statements (Unaudited) 3 Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023 3 Consolidated Statements of Operations for the three and six months ended June 30, 2024 and 2023 4 Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 30, 2024 and 2023 5 Consolidated Statements of Equity for the three and six months ended June 30, 2024 and 2023 6 Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023 8

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 10 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 31 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 48 Item 4.

Controls and Procedures

Controls and Procedures 49

Other Information

Part II Other Information Item 1.

Legal Proceedings

Legal Proceedings 49 Item 1A.

Risk Factors

Risk Factors 49 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 50 Item 3. Defaults Upon Senior Securities 50 Item 4. Mine Safety Disclosures 50 Item 5. Other Information 50 Item 6. Exhibits 51 Signature 53 2 Table of Contents THE MACERICH COMPANY CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except par value) (Unaudited) June 30, 2024 December 31, 2023 ASSETS: Property, net $ 6,138,889 $ 5,900,489 Cash and cash equivalents 70,692 94,936 Restricted cash 110,962 95,358 Tenant and other receivables, net 139,358 183,478 Right-of-use assets, net 114,448 118,664 Deferred charges and other assets, net 284,242 263,068 Due from affiliates 3,298 4,755 Investments in unconsolidated joint ventures 915,817 852,764 Total assets $ 7,777,706 $ 7,513,512 LIABILITIES AND EQUITY: Mortgage notes payable $ 4,373,234 $ 4,136,136 Bank and other notes payable 171,436 89,548 Accounts payable and accrued expenses 67,703 64,194 Lease liabilities 79,731 83,989 Other accrued liabilities 311,425 334,742 Distributions in excess of investments in unconsolidated joint ventures 185,437 174,786 Financing arrangement obligation — 102,516 Total liabilities 5,188,966 4,985,911 Commitments and contingencies Equity: Stockholders' equity: Common stock, $ 0.01 par value, 500,000,000 shares authorized at June 30, 2024 and December 31, 2023, and 216,403,221 and 215,976,614 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively 2,162 2,158 Additional paid-in capital 5,515,333 5,509,603 Accumulated deficit ( 3,012,029 ) ( 3,063,789 ) Accumulated other comprehensive loss ( 32 ) ( 952 ) Total stockholders' equity 2,505,434 2,447,020 Noncontrolling interests 83,306 80,581 Total equity 2,588,740 2,527,601 Total liabilities and equity $ 7,777,706 $ 7,513,512 The accompanying notes are an integral part of these consolidated financial statements. 3 Table of Contents THE MACERICH COMPANY CON

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share and square foot amounts) (Unaudited) 1. Organization: The Macerich Company (the "Company") is involved in the acquisition, ownership, development, redevelopment, management and leasing of regional retail centers and community/power shopping centers (the "Centers") located throughout the United States. The Company commenced operations effective with the completion of its initial public offering on March 16, 1994. As of June 30, 2024, the Company was the sole general partner of and held a 96 % ownership interest in The Macerich Partnership, L.P. (the "Operating Partnership"). The Company was organized to qualify as a real estate investment trust ("REIT") under the Internal Revenue Code of 1986, as amended (the "Code"). The property management, leasing and redevelopment of the Company's portfolio is provided by the Company's management companies, Macerich Property Management Company, LLC, a single member Delaware limited liability company, Macerich Management Company, a California corporation, Macerich Arizona Partners LLC, a single member Arizona limited liability company, Macerich Arizona Management LLC, a single member Delaware limited liability company, Macerich Partners of Colorado LLC, a single member Colorado limited liability company, MACW Mall Management, Inc., a New York corporation, and MACW Property Management, LLC, a single member New York limited liability company. All seven of the management companies are collectively referred to herein as the "Management Companies." All references to the Company in this Quarterly Report on Form 10-Q include the Company, those entities owned or controlled by the Company and predecessors of the Company, unless the context indicates otherwise. 2. Summary of Significant Accounting Policies: Basis of Presentation: The accompanying consolidated financial statements of the Company have been prepared in accordance with generally accep

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share and square foot amounts) (Unaudited) 2. Summary of Significant Accounting Policies: (Continued) The unaudited interim consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the consolidated financial statements for the interim periods have been made. The preparation of consolidated 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accompanying consolidated balance sheet as of December 31, 2023 has been derived from the audited financial statements but does not include all disclosures required by GAAP. The following table presents a reconciliation of the beginning of period and end of period cash, cash equivalents and restricted cash reported on the Company's consolidated balance sheets to the totals shown on its consolidated statements of cash flows: For the Six Months Ended June 30, 2024 2023 Beginning of period Cash and cash equivalents $ 94,936 $ 100,320 Restricted cash 95,358 80,819 Cash, cash equivalents and restricted cash $ 190,294 $ 181,139 End of period Cash and cash equivalents $ 70,692 $ 92,465 Restricted cash 110,962 92,338 Cash, cash equivalents and restricted cash $ 181,654 $ 184,803 Recent Accounting Pronouncements: In November 2023, the Financial Accounting Standards Board issued Accounting Stan

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share and square foot amounts) (Unaudited) 3. Earnings Per Share ("EPS"): The following table reconciles the numerator and denominator used in the computation of EPS for the three and six months ended June 30, 2024 and 2023 (shares in thousands): For the Three Months Ended June 30, For the Six Months Ended June 30, 2024 2023 2024 2023 Numerator Net income (loss) $ 265,499 $ ( 14,406 ) $ 134,053 $ ( 72,600 ) Less: net income attributable to noncontrolling interests 13,492 558 8,774 1,097 Net income (loss) attributable to the Company 252,007 ( 14,964 ) 125,279 ( 73,697 ) Allocation of earnings to participating securities ( 397 ) ( 213 ) ( 440 ) ( 438 ) Numerator for basic and diluted EPS—net income (loss) attributable to common stockholders $ 251,610 $ ( 15,177 ) $ 124,839 $ ( 74,135 ) Denominator Denominator for basic and diluted EPS—weighted average number of common shares outstanding(1) 216,180 215,457 216,108 215,375 EPS—net income (loss) attributable to common stockholders Basic and diluted $ 1.16 $ ( 0.07 ) $ 0.58 $ ( 0.34 ) (1) Diluted EPS excludes 99,565 convertible preferred units for each of the three months ended June 30, 2024 and 2023 and 99,565 convertible preferred partnership units for each of the six months ended June 30, 2024 and 2023, as their impact was antidilutive. Diluted EPS also excludes 10,090,429 and 8,985,493 Operating Partnership units ("OP Units") for the three months ended June 30, 2024 and 2023, respectively, and 10,097,546 and 8,982,075 OP Units for the six months ended June 30, 2024 and 2023, respectively, as their impact was antidilutive. 4. Investments in Unconsolidated Joint Ventures: The Company has made the following recent financings or other events within its unconsolidated joint ventures: On March 3, 2023, the Company's joint venture in Scottsdale Fashion Square replaced the existing $ 403,931 mortgage loan on the pr

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share and square foot amounts) (Unaudited) 4. Investments in Unconsolidated Joint Ventures: (Continued) consolidated its 100 % interest in these five former Sears parcels in its consolidated financial statements (See Note 15—Acquisitions). On December 4, 2023, the Company's joint venture in Tysons Corner Center replaced the existing $ 666,465 mortgage loan on the property with a new $ 710,000 loan that bears interest at a fixed rate of 6.60 %, is interest only during the entire loan term and matures on December 6, 2028. On December 27, 2023, the Company's joint venture in One Westside sold the property, a 680,000 square foot office property in Los Angeles, California for $ 700,000 . The existing $ 324,632 loan on the property was repaid, and $ 77,643 of net proceeds were generated at the Company's 25 % ownership share, which were used to reduce the Company's revolving loan facility. As a result of this transaction, the Company recognized its share of gain on sale of assets of $ 8,118 . On January 10, 2024, the Company's joint venture in Boulevard Shops replaced the existing $ 23,000 mortgage loan on the property with a new $ 24,000 loan that bears interest at a variable rate of SOFR plus 2.50 %, is interest only during the entire loan term and matures on December 5, 2028. The new loan has a required interest rate cap throughout the term of the loan at a strike rate of 7.5 %. The Company has a 50 /50 joint venture with Simon Property Group, which was initially formed to develop Los Angeles Premium Outlets, a premium outlet center in Carson, California. During the three months ended March 31, 2024, the Company evaluated its investment and concluded that due to certain conditions, the Company should not continue to invest capital in this development project. As a result, the Company determined the investment was impaired on an other-than-temporary basis and wrote-off its e

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