Kite Realty Group Trust (KRG) risk factors, FY2024 10-K

RISKS RELATED TO OUR OPERATIONS

1. 01Our business, financial condition, performance, and value are subject to risks and conditions associated with real estate assets and the real estate industry
2. 02Ongoing challenges facing our retail tenants, including bankruptcies, financial instability and consolidations, could have a material adverse effect on our business
3. 03Inflation may adversely affect our financial condition and results of operations
4. 04Tenant bankruptcies have in the past and could in the future make it difficult for us to collect rent or make claims against a tenant in bankruptcy
5. 05E-commerce and other changes in consumer buying practices may impact our tenants and our business
6. 06We face significant competition in leasing space at our properties, which may impact our rental rates, leasing terms and expenditures for capital improvements
7. 07Changing economic and retail market conditions in geographic areas where our properties are concentrated could materially and adversely affect our financial condition and results of operations
8. 08Uninsured losses or losses in excess of insurance coverage could materially and adversely affect us
9. 09Developments and redevelopments have inherent risks that could adversely impact us
10. 10Pandemics or other public health crises could materially and adversely affect our business, financial performance and condition, operating results, and cash flows
11. 11We and our tenants face risks related to cyber attacks that could cause loss of confidential information and other business disruptions
12. 12We may be unable to obtain additional capital through the debt and equity markets on favorable terms or at all
13. 13We have a significant amount of indebtedness outstanding and high interest rates could materially adversely affect us
14. 14We could be adversely affected by the financial and other covenants and provisions contained in our financing agreements
15. 15Adverse changes in our credit ratings could affect our borrowing capacity and borrowing terms
16. 16We are subject to risks associated with hedging agreements, including potential performance failures by counterparties and termination costs
17. 17Joint venture investments could be adversely affected by the structure, terms and activities of our joint venture partners
18. 18We face significant competition and risks in pursuing acquisition opportunities
19. 19We may be unable to sell properties at the time we desire, on favorable terms or at all, which could limit our ability to access capital through dispositions
20. 20We could experience a decline in the fair value of our real estate assets and be subject to impairment charges
21. 21We could be materially and adversely affected if we are found to be in breach of a ground lease at one of our properties or are unable to renew a ground lease
22. 22Natural disasters, severe weather conditions, climate change, and terrorism or other acts of crime or violence could have an adverse impact on our financial condition and results of operations
23. 23We could incur significant costs related to environmental matters, and our ability to identify environmental liabilities may be limited
24. 24Compliance with the ADA and fire, safety and other regulations may require us to make significant capital expenditures
25. 25Use of artificial intelligence presents risks and challenges that could impact our business

RISKS RELATED TO OUR ORGANIZATION AND STRUCTURE

1. 26Our organizational documents and Maryland law contain provisions that may delay, defer or prevent a change in control of the Company
2. 27Our organizational documents contain provisions that may have an anti-takeover effect and inhibit a change in control transaction, which could prevent our shareholders from being paid a premium for their common shares over the then-prevailing market prices
3. 28Our bylaws provide that the Circuit Court for Baltimore City, Maryland will be the exclusive forum for any internal corporate claims and other matters, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us or our trustees, officers, employees, or shareholders
4. 29Focus on corporate responsibility, specifically related to ESG practices, may impose additional costs and expose us to new risks
5. 30Our rights and the rights of our shareholders to take action against our trustees and officers are limited
6. 31Our UPREIT structure may result in potential conflicts of interest with limited partners in our Operating Partnership, including certain of our officers, whose interests may not be aligned with those of our shareholders
7. 32Departure or loss of our key personnel could have an adverse effect on us
8. 33The cash available for distribution to our shareholders may not be sufficient to pay distributions at expected levels nor can we assure you of our ability to make distributions in the future; we may use borrowed funds to make cash distributions and/or choose to make distributions payable, in part, in our common shares
9. 34Future offerings of debt securities, which would be senior to our equity securities, may adversely affect the market price of our common shares

RISKS RELATED TO TAX MATTERS

1. 35If the October 2021 merger with RPAI did not qualify as a reorganization, there may be adverse tax consequences
2. 36We may incur adverse tax consequences if we fail, or RPAI has failed, to qualify as a REIT for U.S. federal income tax purposes
3. 37We will pay some taxes even if we qualify as a REIT
4. 38REIT distribution requirements may increase our debt
5. 39Complying with REIT requirements may limit our ability to hedge effectively and cause us to incur tax liabilities
6. 40Complying with the REIT requirements may cause us to forgo and/or liquidate otherwise attractive investments
7. 41Dividends paid by REITs generally do not qualify for effective tax rates as low as dividends paid by non-REIT “C” corporations
8. 42If a transaction intended to qualify as a Code Section 1031 tax-deferred exchange is later determined to be taxable, we may face adverse consequences
9. 43If the Operating Partnership fails to qualify as a partnership for U.S. federal income tax purposes, we could fail to qualify as a REIT and suffer other adverse consequences
10. 44There is a risk that the tax laws applicable to REITs may change