SEC Form 10-Q filed by Curbline Properties Corp.

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 10-Q

 

 

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2024

OR

 

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ___________ to ___________

Commission file number 1-42265

 

 

Curbline Properties Corp.

(Exact name of registrant as specified in its charter)

 

 

Maryland		93-4224532
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

320 Park Avenue New York, New York		10022
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (216) 755-5500

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.01 Par Value Per Share		CURB		New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer		☐		Accelerated filer		☐
Non-accelerated filer		☒		Smaller reporting company		☐
				Emerging growth company		☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 8, 2024 the registrant had 105,041,594 shares of common stock, $0.01 par value per share, outstanding.

 

---

EXPLANATORY NOTE

This quarterly report of Curbline Properties Corp. (the “Company” or “Curbline Properties”, “we” or “us”) includes the financial statements of the Company, as of September 30, 2024 and for the period July 15, 2024 through September 30, 2024, and the Company’s predecessor, Curbline Properties Corp. Predecessor (“Curbline Predecessor”), as of September 30, 2024 and December 31, 2023 and for the three and nine months ended September 30, 2024 and 2023. Curbline Predecessor means the combination of entities under common control that have been “carved-out” of SITE Centers’ consolidated financial statements and presented on a combined basis.

On October 1, 2024, SITE Centers Corp. (“SITE Centers”) completed the spin-off of Curbline Properties, pursuant to which SITE Centers contributed 79 convenience properties to the Company. The spin-off was effected pursuant to the Separation and Distribution Agreement, dated as of October 1, 2024, among the Company, Curbline Properties LP, a subsidiary of Curbline Properties, and SITE Centers, as further described in the Information Statement (as defined below).

The spin-off is more fully described in the information statement included as Exhibit 99.1 to the Company’s Registration Statement on Form 10 (File No. 001-42265) filed with the Securities and Exchange Commission on September 3, 2024 (the “Information Statement”). The spin-off became effective at 12:01 a.m., Eastern Time, on October 1, 2024.

Following the spin-off, the Company became a separate publicly traded company and intends to qualify and elect to be taxed as a real estate investment trust under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with the Company’s initial taxable year ending December 31, 2024. The Company’s common stock trades on the New York Stock Exchange under the symbol “CURB”.

The financial statements of the Company covered in this report present the financial condition of the Company as of September 30, 2024, which is prior to the spin-off. Therefore, the discussion of the Company’s results of operations, cash flows and financial condition set forth in this report is not necessarily indicative of the future results of operations, cash flows or financial condition of the Company as an independent, publicly traded company. Moreover, the combined financial statements for Curbline Predecessor are not necessarily indicative of the Company’s results of operations, cash flows or financial position following the completion of the spin-off. For more information regarding the risks related to our business, refer to the section captioned “Risk Factors” contained in the Information Statement.

---

 

Curbline Properties Corp.

QUARTERLY REPORT ON FORM 10-Q

Quarter Ended September 30, 2024

 

TABLE OF CONTENTS

 

PART I. FINANCIAL INFORMATION
Item 1.		Financial Statements – Unaudited
		CURBLINE PROPERTIES CORP.
		Balance Sheet as of September 30, 2024		4
		Statement of Equity for the Period July 15, 2024 Through September 30, 2024		4
		Notes to Financial Statements		4
		CURBLINE PROPERTIES CORP. PREDECESSOR
		Combined Balance Sheets as of September 30, 2024 and December 31, 2023		5
		Combined Statements of Operations for the Three Months Ended September 30, 2024 and 2023		6
		Combined Statements of Operations for the Nine Months Ended September 30, 2024 and 2023		7
		Combined Statements of Equity for the Three and Nine Months Ended September 30, 2024 and 2023		8
		Combined Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023		9
		Notes to Combined Financial Statements		10
Item 2.		Management's Discussion and Analysis of Financial Condition and Results of Operations		15
Item 3.		Quantitative and Qualitative Disclosures about Market Risk		26
Item 4.		Controls and Procedures		26
PART II. OTHER INFORMATION
Item 1.		Legal Proceedings		27
Item 1A.		Risk Factors		27
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds		27
Item 3.		Defaults Upon Senior Securities		27
Item 4.		Mine Safety Disclosures		27
Item 5.		Other Information		27
Item 6.		Exhibits		28
SIGNATURES				30

 

 

---

Curbline Properties Corp.

BALANCE SHEET

(unaudited; in thousands; except share amounts)

	September 30, 2024
Assets
Cash and cash equivalents	$	1
	$	1
Liabilities and Equity
Equity
Common stock, $0.01 par value per share; 400,000,000 shares authorized; 104,860,322 shares    issued at September 30, 2024	$	1,048
Preferred stock, $0.01 par value per share; 100,000,000 shares authorized; 0 shares    issued at September 30, 2024	—
Additional paid-in-capital		(1,047	)
Total equity	$	1

 

Curbline Properties Corp.

STATEMENT OF EQUITY

(unaudited; in thousands)

	Common Stock				Additional Paid-in Capital				Total Equity
Balance, July 15, 2024	$	—			$	1			$	1
Issuance of common stock		1,048				(1,048	)			-
Balance, September 30, 2024	$	1,048			$	(1,047	)		$	1

 

The accompanying notes are an integral part of these financial statements.

 

Notes to Financial Statements (Unaudited)

On September 30, 2024, the Company’s charter was amended and restated to, among other things, increase the Company’s authorized capital stock to 400,000,000 shares of common stock, $0.01 par value per share, and 100,000,000 shares of preferred stock, $0.01 par value per share. Also, on September 30, 2024, in connection with the spin-off, the Company issued a dividend to SITE Centers of 104,860,222 shares of Curbline Properties common stock, resulting in a total of 104,860,322 shares outstanding and held by SITE Centers.

---

Curbline Properties Corp. Predecessor

COMBINED BALANCE SHEETS

(unaudited; in thousands)

 

	September 30, 2024				December 31, 2023
Assets
Land	$	409,267			$	316,212
Buildings		736,452				622,414
Fixtures and tenant improvements		72,881				58,676
		1,218,600				997,302
Less: Accumulated depreciation		(156,831	)			(136,168	)
		1,061,769				861,134
Construction in progress		14,053				13,504
Total real estate assets, net		1,075,822				874,638
Cash and cash equivalents		2,541				566
Restricted cash		—				155
Accounts receivable		12,670				11,528
Intangible assets, net		62,909				34,330
Other assets		13,119				415
	$	1,167,061			$	921,632
Liabilities and Equity
Mortgage indebtedness, net	$	—			$	25,758
Below-market leases, net		30,452				21,243
Accounts payable and other liabilities		19,587				11,993
Total liabilities		50,039				58,994
Commitments and contingencies (Note 4)
Equity
Curbline Predecessor equity		1,117,022				862,638
Total equity		1,117,022				862,638
	$	1,167,061			$	921,632

 

The accompanying notes are an integral part of these combined financial statements.

 

---

Curbline Properties Corp. Predecessor

COMBINED STATEMENTS OF OPERATIONS

(unaudited; in thousands)

 

	Three Months
	Ended September 30,
	2024				2023
Revenues from operations:
Rental income	$	29,576			$	24,061
Other income		186				174
		29,762				24,235
Rental operation expenses:
Operating and maintenance		3,541				2,531
Real estate taxes		3,311				3,441
General and administrative		3,578				1,105
Depreciation and amortization		11,108				7,989
		21,538				15,066
Other income (expense):
Interest expense	—					(388	)
Transaction costs and other expense		(23,634	)			(373	)
Gain on disposition of real estate	—					371
		(23,634	)			(390	)
Net (loss) income	$	(15,410	)		$	8,779

 

The accompanying notes are an integral part of these combined financial statements.

---

Curbline Properties Corp. Predecessor

COMBINED STATEMENTS OF OPERATIONS

(unaudited; in thousands)

 

	Nine Months
	Ended September 30,
	2024				2023
Revenues from operations:
Rental income	$	85,386			$	67,697
Other income		572				493
		85,958				68,190
Rental operation expenses:
Operating and maintenance		9,532				7,540
Real estate taxes		9,307				8,819
General and administrative		7,304				3,414
Depreciation and amortization		29,719				23,183
		55,862				42,956
Other income (expense):
Interest expense		(416	)			(1,166	)
Transaction costs and other expense		(30,879	)			(1,054	)
Gain on disposition of real estate	—					371
		(31,295	)			(1,849	)
Net (loss) income	$	(1,199	)		$	23,385

 

The accompanying notes are an integral part of these combined financial statements.

 

 

 

---

Curbline Properties Corp. Predecessor

COMBINED STATEMENTS OF EQUITY

(unaudited; in thousands)

 

	Curbline Predecessor Equity
Balance, December 31, 2023	$	862,638
Net transactions with SITE Centers		88,671
Net income		14,211
Balance, June 30, 2024		965,520
Net transactions with SITE Centers		166,912
Net loss		(15,410	)
Balance, September 30, 2024	$	1,117,022
	Curbline Predecessor Equity
Balance, December 31, 2022	$	691,778
Net transactions with SITE Centers		56,480
Net income		14,606
Balance, June 30, 2023		762,864
Net transactions with SITE Centers		14,770
Net Income		8,779
Balance, September 30, 2023	$	786,413

 

The accompanying notes are an integral part of these combined financial statements.

---

Curbline Properties Corp. Predecessor

COMBINED STATEMENTS OF CASH FLOWS

(unaudited; in thousands)

 

	Nine Months
	Ended September 30,
	2024				2023
Cash flow from operating activities:
Net (loss) income	$	(1,199	)		$	23,385
Adjustments to reconcile net income to net cash flow provided by operating activities:
Depreciation and amortization		29,719				23,183
Amortization and write-off of debt issuance costs		93				116
Assumption of buildings due to ground lease terminations		(2,678	)			—
Gain on disposition of real estate		—				(371	)
Net change in accounts receivable		(1,127	)			(1,529	)
Net change in accounts payable and other liabilities		3,176				3,953
Net change in other operating assets		(2,728	)			238
Total adjustments		26,455				25,590
Net cash flow provided by operating activities		25,256				48,975
Cash flow from investing activities:
Real estate acquired, net of liabilities and cash assumed		(216,198	)			(102,095	)
Real estate improvements to operating real estate		(18,465	)			(17,572	)
Proceeds from disposition of real estate		—				563
Net cash flow used for investing activities		(234,663	)			(119,104	)
Cash flow from financing activities:
Repayment of mortgage debt		(25,651	)			(635	)
Payment of debt issuance costs		(5,034	)			—
Transactions with SITE Centers		241,912				71,250
Net cash flow provided by financing activities		211,227				70,615
Net increase in cash, cash equivalents and restricted cash		1,820				486
Cash, cash equivalents and restricted cash, beginning of period		721				590
Cash, cash equivalents and restricted cash, end of period	$	2,541			$	1,076

 

The accompanying notes are an integral part of these combined financial statements.

---

Notes to Combined Financial Statements

---

---

---

---

 

---

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 (“MD&A”) provides readers with a perspective from management on the financial condition, results of operations and liquidity of Curbline Properties Corp., its combined subsidiaries and Curbline Properties Corp. Predecessor (collectively, the “Company” or “Curbline Properties”) and other factors that may affect the Company’s future results. “Curbline Properties Corp. Predecessor” means the combination of entities under common control that have been “carved out” of SITE Centers’ consolidated financial statements and presented on a combined basis. The Company believes it is important to read the MD&A in conjunction with the information statement included as Exhibit 99.1 to the Company’s Registration Statement on Form 10 filed with the Securities and Exchange Commission on September 3, 2024 (the “Information Statement”) as well as other publicly available information.

EXECUTIVE SUMMARY

Curbline Properties Corp. is a Maryland corporation formed to own, manage, lease, acquire, and develop a portfolio of convenience properties. As of September 30, 2024, the Company’s portfolio consisted of 79 properties comprising approximately 2.7 million square feet of gross leasable area (“GLA”). Prior to the Company's separation on October 1, 2024, the Company was a wholly owned subsidiary of SITE Centers Corp. (“SITE Centers”).

Convenience properties are generally positioned on the curbline of well-trafficked intersections and major vehicular corridors, offering excellent access and visibility, dedicated parking and often include drive-thru units, with approximately half of the Company’s properties having at least one drive-thru unit as of September 30, 2024. Convenience properties generally consist of a homogenous row of primarily small-shop units leased to a diversified mixture of national and local service and restaurant tenants that cater to daily convenience trips from the growing suburban population and typically experience more customer foot traffic per square foot than anchored retail. The property type has the opportunity to generate above-average, occupancy-neutral cash flow growth driven by high retention rates and limited operating capital expenditures given the standardized site plan and depth of leasing prospects that can utilize existing square footage and provide significant tenant diversification. As of September 30, 2024, the median GLA of a property in the Curbline Properties portfolio was 21,000 square feet with 92% of base rent generated by units less than 10,000 square feet.

The Company believes the creation of the first publicly traded real estate investment trust (“REIT”) focused exclusively on the convenience real estate sector positions it well to take advantage of the highly fragmented but liquid marketplace for convenience properties in order to aggregate this type of real estate. As of the date of its separation from SITE Centers, the Company was in a net cash and debt-free position with $800.0 million of cash on hand plus significant access to debt capital in order to grow its asset base through acquisitions with no additional near-term equity required. Additionally, with over 68,000 convenience properties in the United States (950 million square feet of GLA) and over $41 billion of convenience assets traded in the period of 2019 to 2023 (primarily among private investors), the market provides a substantial addressable opportunity for the Company to scale and differentiate itself as the first mover public REIT exclusively focused on convenience assets.

The Company intends to focus on the wealthiest submarkets in the United States with significant barriers to entry. The Curbline Properties portfolio is generally located in submarkets with compelling long-term population and employment growth prospects and above-average household incomes as compared to all shopping centers in the United States.

The following provides an overview of the Company’s key financial metrics (see Non-GAAP Financial Measures described later in this section) (in thousands):

 

	Three Months								Nine Months
	Ended September 30,								Ended September 30,
	2024				2023				2024				2023
Net (loss) income attributable to Curbline Predecessor	$	(15,410	)		$	8,779			$	(1,199	)		$	23,385
FFO attributable to Curbline Predecessor	$	(4,302	)		$	16,397			$	28,520			$	46,197
Operating FFO attributable to Curbline Predecessor	$	19,512			$	16,874			$	59,675			$	47,603

 

For the nine months ended September 30, 2024, the decrease in net income and FFO attributable to Curbline Predecessor, as compared to the prior year period, was primarily the result of the transaction costs related to the spin-off of the Company from SITE Centers, discussed below, partially offset by net impact of property acquisitions.

---

Spin-off from SITE Centers Corp.

In connection with the separation from SITE Centers on October 1, 2024, the Company, Curbline Properties LP (the “Operating Partnership”) and SITE Centers entered into a Separation and Distribution Agreement (the “Separation and Distribution Agreement”), which provided for the principal transactions necessary to consummate the spin-off, including the allocation among the Company, the Operating Partnership and SITE Centers of SITE Centers’ assets, liabilities and obligations attributable to periods both prior to and following the spin-off. In particular, the Separation and Distribution Agreement provided, among other things, that certain assets relating to Curbline Properties’ business were to be transferred to the Operating Partnership or the applicable Curbline Properties subsidiary, including equity interests of certain SITE Centers subsidiaries that held assets and liabilities related to Curbline Properties’ interests in real property, certain tangible personal property, cash and cash equivalents held in Curbline Properties accounts (including the transfer to Curbline Properties of unrestricted cash of $800.0 million upon consummation of the spin-off) and other assets primarily used or held primarily for use in Curbline Properties’ business. The Separation and Distribution Agreement also provided that certain liabilities relating to Curbline Properties’ business were to be transferred to the Operating Partnership or the applicable Curbline Properties subsidiary, including liabilities relating to or arising out of the operation of Curbline Properties’ business after the effective time of the spin-off and liabilities expressly allocated to Curbline Properties or one of its subsidiaries by the Separation and Distribution Agreement or certain other agreements entered into in connection with the spin-off. The Separation and Distribution Agreement governs the rights and obligations among the Company, the Operating Partnership and SITE Centers regarding the distribution both prior to and following the completion of the separation. SITE Centers distributed 100% of the outstanding common stock of Curbline Properties to holders of record of SITE Centers common shares as of the close of business on September 23, 2024, the record date. On October 1, 2024, holders of SITE Centers common shares received two shares of Curbline Properties common stock for every one common share of SITE Centers held on the record date.

Additionally, the Separation and Distribution Agreement contains provisions that obligate SITE Centers to complete certain redevelopment projects at properties that are owned by the Company. As of September 30, 2024, these redevelopment projects were estimated to cost SITE Centers $33.7 million to complete.

On October 1, 2024, the Company, the Operating Partnership and SITE Centers also entered into a Shared Services Agreement (the “Shared Services Agreement”), which provides that, subject to the supervision of SITE Centers’ Board of Directors, the Operating Partnership or its affiliates will provide SITE Centers leadership and management services and transaction services, including the provision of personnel at both the leadership and operations levels.

The Shared Services Agreement also requires SITE Centers to provide the Operating Partnership and its affiliates the services of its employees and the use or benefit of SITE Centers’ assets, offices and other resources as may be necessary or useful to establish and operate various business functions of the Operating Partnership and its affiliates in a manner as would be established and operated for a REIT similarly situated to the Company.

The Operating Partnership will pay SITE Centers a fee in the aggregate amount of 2.0% of the Company's Gross Revenue (as defined in the Shared Services Agreement) during the term of the Shared Services Agreement to be paid in monthly installments. There is no separate fee paid by SITE Centers in connection with the provision of services by the Operating Partnership or its affiliates under the Shared Services Agreement. Unless terminated earlier, the term of the Shared Services Agreement will expire on October 1, 2027. In the event of certain early terminations of the Shared Services Agreement, SITE Centers will be obligated to pay a termination fee to the Operating Partnership equal to $2.5 million multiplied by the number of whole or partial fiscal quarters remaining in the Shared Services Agreement’s three-year term (or $12.0 million in the event SITE Centers terminates the agreement for convenience on its second anniversary).

The Company, the Operating Partnership and SITE Centers also entered into a tax matters agreement, which governs the rights, responsibilities and obligations of the parties following the spin-off with respect to various tax matters and provides for the allocation of tax-related assets, liabilities and obligations. In addition, the Company, the Operating Partnership and SITE Centers entered into an employee matters agreement, which governs the respective rights, responsibilities, and obligations of the parties following the spin-off with respect to transitioning employees, equity plans and retirement plans, health and welfare benefits, and other employment, compensation and benefit-related matters.

Company Activity

Transactional and investment highlights for the Company from October 1, 2024 through November 8, 2024, include the following:

---

Operational Metrics

Key operational results and transactions for the Company from January 1, 2024 through September 30, 2024 include the following:

RESULTS OF OPERATIONS

For the comparison of 2024 performance to 2023, presented below, convenience properties owned as of January 1, 2023, are referred to herein as the “Comparable Portfolio Properties.”

Revenues from Operations (in thousands)

 

	Three Months
	Ended September 30,
	2024				2023				$ Change
Rental income(A)	$	29,576			$	24,061			$	5,515
Other income		186				174				12
Total revenues	$	29,762			$	24,235			$	5,527

 

	Nine Months
	Ended September 30,
	2024				2023				$ Change
Rental income(A)	$	85,386			$	67,697			$	17,689
Other income		572				493				79
Total revenues	$	85,958			$	68,190			$	17,768

 

(A) The following tables summarize the key components of rental income (in thousands):

		Three Months
		Ended September 30,
Contractual Lease Payments		2024				2023				$ Change
Base and percentage rental income		$	22,152			$	18,075			$	4,077
Recoveries from tenants			6,724				5,922				802
Uncollectible revenue			(33	)			(46	)			13
Lease termination fees, ancillary and other rental income			733				110				623
Total contractual lease payments		$	29,576			$	24,061			$	5,515

 

		Nine Months
		Ended September 30,
Contractual Lease Payments		2024				2023				$ Change
Base and percentage rental income(1)		$	63,242			$	52,010			$	11,232
Recoveries from tenants(2)			18,407				15,764				2,643
Uncollectible revenue(3)			(512	)			(394	)			(118	)
Lease termination fees, ancillary and other rental income(4)			4,249				317				3,932
Total contractual lease payments		$	85,386			$	67,697			$	17,689

 

---

 

 

		Increase (Decrease)
Acquisition of convenience properties		$	8.3
Comparable Portfolio Properties			2.9
Total		$	11.2

At September 30, 2024 and 2023, the Company owned 79 and 61 wholly owned properties, respectively, with an aggregate occupancy rate of 93.8% and 93.6%, respectively, and average ABR per occupied square foot of $35.65 and $35.31, respectively.

Expenses from Operations (in thousands)

 

	Three Months
	Ended September 30,
	2024				2023				$ Change
Operating and maintenance	$	3,541			$	2,531			$	1,010
Real estate taxes		3,311				3,441				(130	)
General and administrative		3,578				1,105				2,473
Depreciation and amortization		11,108				7,989				3,119
	$	21,538			$	15,066			$	6,472

 

	Nine Months
	Ended September 30,
	2024				2023				$ Change
Operating and maintenance(A)	$	9,532			$	7,540			$	1,992
Real estate taxes(A)		9,307				8,819				488
General and administrative(B)		7,304				3,414				3,890
Depreciation and amortization(A)		29,719				23,183				6,536
	$	55,862			$	42,956			$	12,906

 

 

		Operating and Maintenance				Real Estate Taxes				Depreciation and Amortization
Acquisition of convenience properties		$	1.5			$	1.0			$	6.2
Comparable Portfolio Properties			0.5				(0.5	)			0.3
		$	2.0			$	0.5			$	6.5

 

---

Other Income and Expenses (in thousands)

 

	Three Months
	Ended September 30,
	2024				2023				$ Change
Interest expense	$	—			$	(388	)		$	388
Transaction costs and other expenses		(23,634	)			(373	)			(23,261	)
Gain on disposition of real estate	—					371				(371	)
	$	(23,634	)		$	(390	)		$	(23,244	)

 

	Nine Months
	Ended September 30,
	2024				2023				$ Change
Interest expense(A)	$	(416	)		$	(1,166	)		$	750
Transaction costs and other expenses(B)		(30,879	)			(1,054	)			(29,825	)
Gain on disposition of real estate	—					371				(371	)
	$	(31,295	)		$	(1,849	)		$	(29,446	)

Net (Loss) Income (in thousands)

 

	Three Months
	Ended September 30,
	2024				2023				$ Change
Net (loss) income attributable to Curbline Predecessor	$	(15,410	)		$	8,779				(24,189	)

 

	Nine Months
	Ended September 30,
	2024				2023				$ Change
Net (loss) income attributable to Curbline Predecessor(A)	$	(1,199	)		$	23,385				(24,584	)

NON-GAAP FINANCIAL MEASURES

Funds from Operations and Operating Funds from Operations

Definition and Basis of Presentation

The Company believes that Funds from Operations (“FFO”) and Operating FFO (as defined below), both non-GAAP financial measures, provide additional and useful means to assess the financial performance of REITs. FFO and Operating FFO are frequently used by the real estate industry, as well as securities analysts, investors and other interested parties, to evaluate the performance of REITs. 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 excludes GAAP historical cost depreciation and amortization of real estate and real estate investments, which assume that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions, and many companies use different depreciable lives and methods. Because FFO excludes depreciation and amortization unique to real estate and gains and losses from property dispositions, it can provide a performance measure that, when compared year over year, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, interest costs and acquisition, disposition and development activities. This provides a perspective of the Company’s financial performance not immediately apparent from net income determined in accordance with GAAP.

FFO is generally defined and calculated by the Company as net income (loss) (computed in accordance with GAAP), adjusted to exclude (i) gains and losses from disposition of real estate property, which are presented net of taxes, if any, (ii) impairment charges on real estate property and (iii) certain non-cash items. These non-cash items principally include real property depreciation and

---

amortization of intangibles. The Company’s calculation of FFO is consistent with the definition of FFO provided by the National Association of Real Estate Investment Trusts (“NAREIT”).

The Company believes that certain charges, income and gains recorded in its operating results are not comparable or reflective of its core operating performance. 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. As a result, the Company also computes Operating FFO and discusses it with the users of its financial statements, in addition to other measures such as net income (loss) determined in accordance with GAAP and FFO. Operating FFO is generally defined and calculated by the Company as FFO excluding certain charges, income and gains that management believes are not comparable and indicative of the results of the Company’s operating real estate portfolio. The disclosure of these adjustments is regularly requested by users of the Company’s financial statements.

The adjustment for these charges, income and gains may not be comparable to how other REITs or real estate companies calculate their results of operations, and the Company’s calculation of Operating FFO differs from NAREIT’s definition of FFO. Additionally, the Company provides no assurances that these charges, income and gains are non-recurring. These charges, income and gains could reasonably be expected to recur in future results of operations.

These measures of performance are used by the Company for several business purposes and by other REITs. The Company uses FFO and/or Operating FFO in part (i) as a disclosure to improve the understanding of the Company’s operating results among the investing public, (ii) as a measure of a real estate asset company’s performance, (iii) to influence acquisition, disposition and capital investment strategies and (iv) to compare the Company’s performance to that of other publicly traded shopping center REITs.

For the reasons described above, management believes that FFO and Operating FFO provide the Company and investors with an important indicator of the Company’s operating performance. They provide recognized measures of performance other than GAAP net income, which may include non-cash items. Other real estate companies may calculate FFO and Operating FFO in a different manner.

Management recognizes the limitations of FFO and Operating FFO when compared to GAAP’s net income. FFO and Operating FFO do not represent amounts available for dividends, capital replacement or expansion, debt service obligations or other commitments and uncertainties. Management does not use FFO or Operating FFO as an indicator of the Company’s cash obligations and funding requirements for future commitments, acquisitions or development activities. Neither FFO nor Operating FFO represents cash generated from operating activities in accordance with GAAP, and neither is necessarily indicative of cash available to fund cash needs. Neither FFO nor Operating FFO should be considered an alternative to net income (computed in accordance with GAAP) or as an alternative to cash flow as a measure of liquidity. FFO and Operating FFO are simply used as additional indicators of the Company’s operating performance. The Company believes that to further understand its performance, FFO and Operating FFO should be compared with the Company’s reported net income (loss) and considered in addition to cash flows determined in accordance with GAAP, as presented in its combined financial statements. Reconciliations of these measures to their most directly comparable GAAP measure of net income (loss) have been provided below.

Reconciliation Presentation

A reconciliation of net (loss) income to FFO and Operating FFO is as follows (in thousands). The Company provides no assurances that these charges and gains adjusted in the calculation of Operating FFO are non-recurring. These charges and gains could reasonably be expected to recur in future results of operations.

	Three Months								Nine Months
	Ended September 30,								Ended September 30,
	2024				2023				2024				2023
Net (loss) income attributable to Curbline Predecessor	$	(15,410	)		$	8,779			$	(1,199	)		$	23,385
Depreciation and amortization of real estate investment		11,108				7,989				29,719				23,183
Gain on disposition of real estate	—					(371	)		—					(371	)
FFO		(4,302	)			16,397				28,520				46,197
Separation and other charges		186				104				304				368
Transaction and debt extinguishment costs		23,628				373				30,851				1,038
Operating FFO	$	19,512			$	16,874			$	59,675			$	47,603

The decrease in net (loss) income and FFO for the nine months ended September 30, 2024, as compared to the prior-year period, was primarily due to the increase in transactions costs due to the spin-off, partially offset by the net impact of property acquisitions. The increase in Operating FFO for the nine months ended September 30, 2024, as compared to the prior-year period, was primarily due to the net impact of property acquisitions.

---

LIQUIDITY, CAPITAL RESOURCES AND FINANCING ACTIVITIES

The Company requires capital to fund its business plan including investment activities, capital expenditures and operating expenses. Immediately following its separation from SITE Centers, the Company’s primary sources of capital consisted of approximately $800.0 million of cash on hand, a $400.0 million unsecured, undrawn line of credit and a $100.0 million unsecured, delayed draw term loan, along with cash flow from operations. The Company may also raise additional capital as appropriate to finance the growth of its business.

Debt outstanding was $25.8 million December 31, 2023. As of September 30, 2024, there was no indebtedness outstanding.

Revolving Credit Facility and Term Loan Facility

In connection with the separation, the Operating Partnership, as borrower, the Company, the lenders named therein and Wells Fargo Bank, National Association, as administrative agent entered into a credit agreement (the “Credit Agreement”). The Credit Agreement provides for a revolving credit facility in the amount of $400.0 million (the “Revolving Credit Facility”) and a delayed draw term loan facility in the amount of $100.0 million (the “Term Loan Facility” and together with the Revolving Credit Facility, the “Credit Facilities”). The aggregate amount available under the Credit Facilities may be increased up to $750.0 million so long as existing or new lenders agree to provide incremental commitments and subject to the satisfaction of certain customary conditions.

The Revolving Credit Facility matures in October 2028, subject to two six-month options to extend the maturity to October 2029 at the Operating Partnership’s option and subject to the satisfaction of certain conditions. Borrowings under the Revolving Credit Facility bear interest at variable rates at the Operating Partnership’s election, based on either (i) the term or daily simple SOFR rate plus a credit spread adjustment plus an applicable margin, or (ii) the alternative base rate plus an applicable margin. The Revolving Credit Facility also provides for a facility fee, paid on a quarterly basis. Each of the applicable margin and the facility fee under the Revolving Credit Facility varies based on whether the Company has obtained a long-term senior unsecured debt rating of at least BBB- (or the equivalent) from S&P Global Ratings or Fitch Investor Services Inc. or a long-term unsecured debt rating of Baa3 (or the equivalent) from Moody’s Investors Service, Inc. (each, an “IG Rating”). Prior to obtaining an IG Rating, each of the applicable margin and facility fee is based on the Company’s ratio of consolidated outstanding indebtedness to consolidated market value and after obtaining an IG Rating, the applicable margin and facility fee will be based on the Company’s IG Rating. No amounts were drawn under the Revolving Credit Facility as of the spin-off date.

Loans under the Term Loan Facility may be drawn in whole or in part during the availability period, which terminates on April 1, 2025. Any loan under the Term Loan Facility drawn prior to such termination date will mature in October 2027, subject to two one-year options to extend its maturity to October 2029 at the Operating Partnership’s option and subject to the satisfaction of certain conditions. Loans under the Term Loan Facility bear interest at variable rates at the Operating Partnership’s election, based on either (i) the term or daily simple SOFR rate plus a credit spread adjustment plus an applicable margin or (ii) the alternative base rate plus an applicable margin. The Term Loan Facility also provides for the payment of a ticking fee. Similar to the Revolving Credit Facility, the applicable margin under the Term Loan Facility varies. Prior to obtaining an IG Rating, the applicable margin is based on the Company’s ratio of consolidated outstanding indebtedness to consolidated market value and after the obtaining an IG Rating, the applicable margin will be based on the Company’s IG Rating. No loans were drawn under the Term Loan Facility as of the spin-off date.

The Credit Facilities contain certain customary covenants including, among other things, leverage ratios and debt service coverage and fixed-charge coverage ratios, as well as limitations on the Company’s ability to sell all or substantially all of the Company’s assets and engage in certain mergers and acquisitions. The Credit Facilities also contain customary default provisions including, among other things, the failure to make timely payments of principal and interest payable thereunder and the failure of the Company or its subsidiaries to pay, when due, certain indebtedness in excess of certain thresholds beyond applicable grace and cure periods.

On October 24, 2024, the Company entered into a $100.0 million forward interest rate swap agreement to fix the variable-rate SOFR component of the Company's $100.0 million Term Loan Facility to 3.578%, from April 1, 2025 through October 1, 2028. The all-in rate of the Term Loan Facility will be fixed at 4.978% based on the loan’s current applicable spread.

As part of its growth strategy, the Company may incur a substantial amount of debt to finance future acquisitions, including debt that refinances or replaces borrowings under the Revolving Credit Facility or the Term Loan Facility. While the Company believes it has several viable sources to obtain capital and fund its business, the sources of funds could be affected by various risks and uncertainties.

---

Dividend Distributions

The Company anticipates making distributions to holders of its common stock to satisfy the requirements to qualify as a REIT and generally not be subject to U.S. federal income and excise tax (other than with respect to operations conducted through a taxable REIT subsidiary of the Company). U.S. federal income tax law generally requires that a REIT distribute annually at least 90% of its REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and that it pay tax at regular corporate rates to the extent that it annually distributes less than 100% of its REIT taxable income. The Company generally intends to make distributions with respect to each taxable year in an amount at least equal to its REIT taxable income for such taxable year. To the extent that cash available for distribution is less than the Company’s REIT taxable income, the Company may make a portion of its distributions in the form of additional shares of common stock, and any such distribution of such common stock may be taxable as a dividend to stockholders.

Although the Company generally expects to declare and pay distributions on a quarterly basis, the Company’s Board of Directors (the “Curbline Properties Board”) will evaluate its distribution policy regularly in order to maintain sufficient liquidity for operations and in order to maximize the Company’s free cash flow while still adhering to REIT payout requirements and minimizing federal income taxes (excluding federal income taxes applicable to its taxable REIT subsidiary activities). The Curbline Properties Board may choose not to declare a distribution in 2024, unless necessary to satisfy certain requirements for the Company to be taxed as a REIT.

Any distributions the Company makes to its stockholders will be at the discretion of the Curbline Properties Board and will depend upon, among other things, the Company’s actual and anticipated results of operations and liquidity, which will be affected by various factors, including the income from its portfolio, its operating expenses and any other expenditures.

Cash Flow Activity

The Company expects that its core business of leasing space to well capitalized retailers will continue to generate consistent cash flow after expenses. The following presents a summary of combined statements of cash flow (in thousands):

 

	Nine Months
	Ended September 30,
	2024				2023
Cash flow provided by operating activities	$	25,256			$	48,975
Cash flow used for investing activities		(234,663	)			(119,104	)
Cash flow provided by financing activities		211,227				70,615

Changes in cash flows for the nine months ended September 30, 2024, compared to the prior-year period, are as follows:

Operating Activities: Cash provided by operating activities decreased $23.7 million primarily due to higher transaction costs related to the spin-off and partially offset by the net impact of property acquisitions.

Investing Activities: Cash used for investing activities increased $115.6 million primarily due to the increase in real estate assets acquired.

Financing Activities: Cash provided by financing activities increased $140.6 million primarily due to the increase in transactions with SITE Centers of $170.7 million offset by an increase in the repayment of mortgage debt and loan costs of $30.1 million.

SOURCES AND USES OF CAPITAL

The Company remains committed to maintaining sufficient liquidity and financial flexibility in order to pursue its stated business plan to acquire additional convenience properties and scale the Company's portfolio while managing its overall risk profile.

The Company was in a net cash position at the time of its separation from SITE Centers with approximately $800.0 million of cash on hand, a $400.0 million unsecured, undrawn line of credit and a $100.0 million unsecured, delayed draw term loan in place and no indebtedness. Cash flow from operations, as well as debt and equity financings, represent additional potential sources of proceeds to be used to execute on the Company’s business plan.

---

Acquisitions

Through September 30, 2024, the Company acquired the following convenience properties (in thousands of square feet and $):

 

Date Acquired		Property Name		City, State		Total Owned GLA				Gross Purchase Price
February 2024		Grove at Harper's Preserve		Conroe, Texas			22			$	10,650
March 2024		Shops at Gilbert Crossroads		Gilbert, Arizona			15				8,460
May 2024		Wilmette Center		Wilmette, Illinois			9				2,850
May 2024		Sunrise Plaza		Vero Beach, Florida			17				5,500
May 2024		Meadowmont Village		Chapel Hill, North Carolina			62				26,534
June 2024		Red Mountain Corner		Phoenix, Arizona			6				2,100
June 2024		Roswell Market Center		Roswell, Georgia			82				17,750
July 2024		Crocker Commons		Westlake, Ohio			29				18,500
July 2024		Maple Corner		Henderson, Tennessee			20				8,250
August 2024		Village Plaza		Houston, Texas			42				31,000
August 2024		Brookhaven Station		Atlanta, Georgia			45				30,200
September 2024		Loma Alta Station		Oceanside, California			35				12,350
September 2024		Nine Mile Corner		Erie, Colorado			18				10,880
September 2024		Crossroads Marketplace		Chino Hills, California			77				34,150
							479			$	219,174

Subsequent to September 30, 2024 and through November 8, 2024, the Company acquired 12 properties aggregating approximately 204,000 square feet of GLA for an aggregate purchase price of $81.6 million.

Construction and Redevelopment Pipeline

The Company evaluates opportunities within the portfolio, particularly as it relates to the efficient use of the underlying real estate, which includes projects to expand and re-tenant various properties. The Company generally expects to commence construction on projects only after substantial tenant leasing has occurred. At September 30, 2024, the Company had approximately $2.3 million in construction in progress in various active consolidated projects. Pursuant to the terms of the Separation and Distribution Agreement, SITE Centers is obligated to complete three redevelopment projects at properties owned by Curbline Properties, the costs of which were estimated to be $33.7 million at September 30, 2024.

CONTRACTUAL OBLIGATIONS AND OTHER COMMITMENTS

The Company routinely enters into contracts for the maintenance of its properties. These contracts typically can be canceled upon 30 to 60 days’ notice without penalty. At September 30, 2024, the Company had purchase order obligations, typically payable within one year, aggregating approximately $0.5 million related to the maintenance of its properties.

ECONOMIC CONDITIONS

The Company continues to experience steady retailer demand for vacant space and executed new leases and renewals aggregating approximately 257,000 square feet of GLA for the nine months ended September 30, 2024. The Company believes the elevated levels of tenant activity are attributable to demand for space at properties located on the curbline of well-trafficked intersections and major vehicular corridors along with limited new supply. Additionally, the Company’s portfolio benefits from its concentration in suburban, above-average household income communities along with positive demographic and economic trends.

The Company has a diversified tenant base, with only one tenant whose annualized rental revenue equals or exceeds 2% of the Company’s annualized combined revenues (Starbucks at 2.3% as of September 30, 2024). Other significant national tenants generally have relatively strong financial positions, have outperformed their respective retail categories over time and the Company believes remain well-capitalized. The majority of the tenants in the Company’s convenience properties provide day-to-day consumer necessities with a focus on value and convenience, versus discretionary items, which the Company believes will enable many of the tenants to outperform under a variety of economic conditions and provide a stable revenue base. The Company has relatively little reliance on overage or percentage rents generated by tenant sales performance or on ancillary or other property income.

The Company believes that its property portfolio is well positioned, as evidenced by recent leasing activity, historical leased and occupancy levels and consistent growth in rental income. At September 30, 2024, the convenience property portfolio leased and occupancy rates were 95.4% and 93.8%, respectively, and the portfolio ABR per square foot was $35.65, as compared to leased and

---

occupancy rates of 96.3% and 93.6%, respectively, and ABR per square foot of $35.31 at September 30, 2023. The per square foot cost of leasing capital expenditures has been consistent with the Company’s historical trends and the standardized site plan of the majority of the Company’s convenience properties together with high tenant retention rates, higher average base rents per square foot and the depth of leasing prospects that can utilize existing square footage generally result in lower operating capital expenditure levels as a percentage of average base rents over time. The Company generally does not expend a significant amount of capital on lease renewals which constitute the majority of overall leasing activity. The weighted-average cost of tenant improvements and lease commissions estimated to be incurred over the expected lease term for all leases executed during the nine months ended September 30, 2024, was $1.62 per rentable square foot.

Inflation, higher interest rates and the pace of retail sales growth, along with the volatility of global capital markets continue to pose risks to the U.S. economy, the retail sector overall and the Company’s tenants. The retail sector overall has also been affected by changing consumer spending patterns and e-commerce market share gains. The Company routinely monitors the credit profiles of its tenants and analyzes the possible impact of any potential tenant credit issues on the financial statements and overall cash flow, balance sheet and liquidity. In some cases, changing conditions have resulted in weaker retailers losing market share and declaring bankruptcy and/or closing stores. However, other retailers continue to expand their store fleets and launch new concepts within the suburban, high-household-income communities in which the properties are located. As a result, the Company believes that its prospects to backfill any spaces vacated by bankrupt or non-renewing tenants are favorable. However, there can be no assurance that vacancy resulting from increasingly uncertain economic conditions will not adversely affect the Company’s operating results.

Rising interest rates and the availability of commercial real estate financing have also impacted, at certain times, real estate owners’ ability to transact and raise equity and debt financing. Although the Company had no indebtedness as of September 30, 2024, debt capital markets liquidity could adversely impact the Company’s current and expected future business plan and its ability to finance future maturities and/or investments, and the interest rates applicable thereto. Depending on market conditions, the Company intends to acquire additional assets funded with cash on hand along with retained cash flow and debt and equity financing. The timing of certain acquisitions may be impacted by capital markets activity along with the volume and pricing of assets available to acquire. Unfavorable changes in interest rates or the capital markets could adversely impact the Company’s return on investments.

FORWARD-LOOKING STATEMENTS

MD&A should be read in conjunction with the Company’s combined financial statements and the notes thereto appearing elsewhere in this report. Historical results and percentage relationships set forth in the Company’s combined financial statements, including trends that might appear, should not be taken as indicative of future operations. The Company considers portions of this information to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”), both as amended, with respect to the Company’s expectations for future periods. Forward-looking statements include, without limitation, statements related to acquisitions (including any related pro forma financial information) and other business development activities, future capital expenditures, financing sources and availability and the effects of environmental and other regulations. Although the Company believes that the expectations reflected in these 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 statements of historical fact should be deemed to be forward-looking statements. Without limiting the foregoing, the words “will,” “believes,” “anticipates,” “plans,” “expects,” “seeks,” “estimates” and similar expressions are intended to identify forward-looking statements. Readers should exercise caution in interpreting and relying on forward-looking statements because such statements involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control and that could cause actual results to differ materially from those expressed or implied in the forward-looking statements and that could materially affect the Company’s actual results, performance or achievements. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements see the section captioned “Risk Factors” included in the Information Statement.

Factors that could cause actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, but are not limited to, the following:

---

---

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

The Company’s fixed-rate debt was repaid in May 2024. At December 31, 2023, the Company’s carrying value of the fixed-rate debt was $25.8 million and the fair value was $24.8 million. A 100 basis-point increase in interest rates was estimated to result in a decrease in the fair value of the debt to $24.6 million. The sensitivity to changes in interest rates of the Company’s fixed-rate debt was determined using a valuation model based upon factors that measure the net present value of such obligations that arise from the hypothetical estimate as discussed above.

If the Company were to incur variable-rate indebtedness, its exposure to increases in interest rates could increase. The Company does not believe, however, that increases in interest expense as a result of inflation or other economic factors will significantly impact the Company’s distributable cash flow.

The Company intends to continually monitor and actively manage interest costs on any variable-rate debt portfolio and may enter into swap positions or interest rate caps. Accordingly, the cost of obtaining such protection agreements in relation to the Company’s access to capital markets will continue to be evaluated. The Company has not entered into, and does not plan to enter into, any derivative financial instruments for trading or speculative purposes. As of September 30, 2024, the Company had no other material exposure to market risk.

On October 24, 2024, the Company entered into a $100.0 million forward interest rate swap agreement to fix the variable-rate SOFR component of the Company's $100.0 million Term Loan Facility to 3.578%, from April 1, 2025 through October 1, 2028. The all-in rate of the Term Loan Facility will be fixed at 4.978% based on the loan’s current applicable spread.

 

Item 4. CONTROLS AND PROCEDURES

The Company’s management, with the participation of the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), conducted an evaluation, pursuant to Exchange Act Rules 13a-15(b) and 15d-15(b), of the effectiveness of our disclosure controls and procedures. Based on their evaluation as required, the CEO and CFO have concluded that the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) were effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and were effective as of the end of such period to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its CEO and CFO, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

During the three months ended September 30, 2024, there were no changes in the Company’s internal control over financial reporting that materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

---

PART II

OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

The Company and its subsidiaries are subject to various legal proceedings, which, taken together, are not expected to have a material adverse effect on the Company. The Company is also subject to a variety of legal proceedings or claims for personal injury or property damage arising in the ordinary course of its business, most of which are covered by insurance, although they may be subject to deductibles or retentions. While the resolution of all matters cannot be predicted with certainty, management believes that the final outcome of such legal proceedings and claims will not have a material adverse effect on the Company’s liquidity, financial position or results of operations.

Item 1A. RISK FACTORS

There have been no material changes to the risk factors set forth in the Information Statement.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

In connection with the spin-off, on September 30, 2024, the Company issued 104,860,222 shares of the Company’s common stock to SITE Centers, such that SITE Centers owned an aggregate of 104,860,322 shares of common stock.

On October 1, 2024, SITE Centers distributed shares of the Company’s common stock to the holders of SITE Centers common shares as of September 23, 2024, the record date, at a ratio of two shares of the Company’s common stock for every one SITE Centers common share, resulting in a distribution of an aggregate 104,860,322 shares of such common stock.

The issuance of common stock by the Company was exempt from registration pursuant to Section 4(a)(2) of the Securities Act, as transactions not involving a public offering.

Item 3. DEFAULTS UPON SENIOR SECURITIES

None.

Item 4. MINE SAFETY DISCLOSURES

Not applicable.

Item 5. OTHER INFORMATION

On November 13, 2024, the Company, Curbline TRS LLC, a subsidiary of the Company (“Curbline TRS”) and David R. Lukes, the Company’s President and Chief Executive Officer (“Executive”), entered into an amendment (the “Amendment”) to Mr. Lukes’ current employment agreement, dated as of September 1, 2024, with Curbline and Curbline TRS (the “Employment Agreement”).

The primary purpose of the Amendment is to provide Mr. Lukes with an annual opportunity to elect, no later than December 31 of each calendar year during the term of the Employment Agreement (or such earlier date determined by the Compensation Committee of the Company’s Board of Directors), to receive up to 100% of his annual cash incentive payout (if any) for the next calendar year in the form of a grant of time-based Company restricted stock (“Restricted Stock”) or Curbline Properties LP limited partnership units (“LTIP Units”). If Mr. Lukes elects Restricted Stock or LTIP Units for any portion of an annual cash incentive payout, the number of shares of Restricted Stock or LTIP Units will be equal to 1.2 times the portion of the annual cash incentive payout that is subject to the election, divided by the 10-day average closing price for Company common stock prior to the grant date. The grant will generally vest in equal installments on the first three anniversaries of the grant date, subject to the terms of the award agreement and the Employment Agreement, as amended.

---

Item 6. EXHIBITS

 

3.1		Articles of Amendment and Restatement of Curbline Properties Corp. (incorporated herein by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-8 filed on September 30, 2024)
3.2		Bylaws of Curbline Properties Corp. (incorporated herein by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-8 filed on September 30, 2024)
10.1		Curbline Properties Corp. 2024 Equity and Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.6 to the Company’s Registration Statement on Form 10 filed on September 3, 2024 (the “Form 10”))1
10.2		Assigned Employment Agreement, dated as of September 1, 2024 by and among SITE Centers Corp., Curbline Properties Corp., Curbline TRS LLC and David R. Lukes (incorporated herein by reference to Exhibit 10.9 to the Form10)1
10.3		Assigned Employment Agreement, dated as of September 1, 2024 by and among SITE Centers Corp., Curbline Properties Corp., Curbline TRS LLC and Conor M. Fennerty (incorporated herein by reference to Exhibit 10.10 to the Form 10)1
10.4		Assigned Employment Agreement, dated as of September 1, 2024 by and among SITE Centers Corp., Curbline Properties Corp., Curbline TRS LLC and John Cattonar (incorporated herein by reference to Exhibit 10.11 to the Form 10)1
10.5		Assigned Employment Agreement, dated as of September 1, 2024 by and among SITE Centers Corp., Curbline Properties Corp., Curbline TRS LLC and Lesley H. Solomon (incorporated herein by reference to Exhibit 10.12 to the Form 10)1
10.6		Form of Director and Officer Indemnification Agreement (incorporated herein by reference to Exhibit 10.7 to the Form 10)
10.7		Curbline Properties Corp. Elective Deferred Compensation Plan (incorporated herein by reference to Exhibit 10.5 to the Form 10)1
31.1		Certification of principal executive officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 19342
31.2		Certification of principal financial officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 19342
32.1		Certification of chief executive officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of this report pursuant to the Sarbanes-Oxley Act of 20022,3
32.2		Certification of chief financial officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of this report pursuant to the Sarbanes-Oxley Act of 20022,3
101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document2
101.SCH		Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Document2
104		The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 has been formatted in Inline XBRL and included in Exhibit 101.

Attached as Exhibit 101 to this report are the following formatted in iXBRL (Inline Extensible Business Reporting Language): (a) Curbline Properties Corp. (i) Balance Sheet as of September 30, 2024 (ii) Statement of Equity for the Period July 15, 2024 Through September 30, 2024 and (iii) Notes to Financial Statements and (b) Curbline Properties Corp. Predecessor (i) Combined Balance Sheets as of September 30, 2024 and December 31, 2023, (ii) Combined Statements of Operations for the Three and Nine Months Ended September 30, 2024 and 2023, (iii) Combined Statements of Equity for the Three and Nine Months Ended

---

September 30, 2024 and 2023 , (iv) Combined Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023 and (v) Notes to Combined Financial Statements.

---

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

		CURBLINE PROPERTIES CORP.
		By:		/s/ Christina M. Yarian
				Name:		Christina M. Yarian
				Title:		Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)
Date: November 13, 2024

 

---