The Macerich Company BofA NY Global Real Estate Conference 2026

Great. All right. Good afternoon, everyone, and thanks, Samir, for hosting this conference. Just want to introduce my team. Dan Swanstrom, he's our CFO. Doug Healey is our EVP, Head of Leasing. Brad Miller is our Senior Vice President, Head of Portfolio Management, and Alexandra Johnstone is our Vice President of Investor Relations and Financial Strategy with Dan. I apologize. I'm going to read some prepared remarks so I don't forget, and you all can ask a lot of questions, I'm sure, afterwards. I'll start with two years ago at this conference, we were basically launching the Path Forward plan 1.0, and it was really just a plan at that point.

I'm happy to say today, after 3.0, we've largely de-risked the Path Forward plan, and I'm extremely excited about the opportunity that not only are we seeing within the portfolio, but the organic growth within the portfolio as well as some of the external growth opportunities that we're seeing today in the market. Just as a reminder, the Path Forward plan rests on three critical pillars. The first is simplifying the business, the second is improving operating metrics, and the third is reducing leverage. In June, at NAREIT, as you all know, we produced the Path Forward 3.0 version, and we are meaningfully ahead of all three of the Path Forward presentations that we've put out at this point. We've completed approximately $1.3 billion of the $2 billion dispositions that were part of our plan.

Our expectation is another $300 million to $400 million of dispositions or loan give backs by year-end, which will bring our total up to $1.6 billion to $1.7 billion out of the two as part of the plan. From a leverage perspective, our current net debt to EBITDA is 7.3 times, which is about 1.5 turns below where we were at the outset of Path Forward 1.0, but two years ago. Most importantly, with the capital that we raised recently, as well as the SNO pipeline coming in, we expect to be plus or minus just around six times net debt to EBITDA by 2028. Operational performance begins and ends with leasing. I'm sure we'll talk a lot about leasing. We've gotten a lot of questions on leasing in our one-on-ones. But the momentum from our record leasing in 2025 has carried through into 2026.

I'm sure most of you have heard about our leasing speedometer, but that speedometer currently sits at 89%, which I think is an awesome accomplishment by the team. If you think about tariffs, wars, all kinds of stuff happening. In spite of that, we've been able to do a tremendous amount of new leasing as part of this plan. Of the roughly 1,000 new leases that were part of the base plan of the Path Forward, we have 950 committed at this point, either committed or under LOI. That really leaves 50 left. Doug, I'm sure we'll talk a little bit later, but we really don't have much new leasing inventory left as part of the plan. Our 2026 renewals are done.

We're well into 2027, and so our leasing teams now are really focused on 2029, 2030, and evaluating a lot of the new acquisition opportunities that we're looking at. With this leasing component of our plan largely behind us, our attention for the team has flipped to convert. So that means basically getting tenants open and paying rent on time. That's what we talk about our RCD, which you'll see our rent commencement schedule slide speedometer. So this is basically an algorithm that we focus on to make sure that we can deliver income SNO on time as scheduled, that we talked about. Our rent commencement schedule stands at about 59% right now. So out of 1,000 spaces that we've talked about, 485 are open and paying rent. 75 are under construction. There's a big group that are in the basically lease permitting stage.

We've got 120 or so leases out that we're negotiating, trying to bring to fruition, and we have 100 LOIs that we're moving towards getting to the point where we can go through and approve these leases. Then, as I said, there's about 55 prospecting that are spread across the go-forward portfolio. One of the things about this operational metric is it's intended to bring more transparency in our progress as we move tenants from LOI to store opening. As you all know, our signed but not open pipeline has reached $128 million out of the $140 million total opportunity that we talked about back two years ago in Path Forward 1.0. Just as a reminder, this is committed organic growth that flows through NOI in 2028.

In order to improve center vibrancy and increase foot traffic and sales, addressing vacant anchor stores was a critical component of our plan, and I reiterated this. All 30 of the targeted vacant anchors are now committed, which is comprising 2.9 million square feet, and we expect to generate something in the order of $750 million in sales. But more importantly, it's going to drive traffic and leasing into those former vacant wings, which were very difficult to handle. As I noted on our Q2 earnings call, we expect go-forward NOI to grow at least 3% this year, back-end weighted, which implies at least 3.5% NOI growth expected in the second half of 2026. Then to accelerate meaningfully in 2027 and 2028 as the SNO pipeline tenants continue to open and begin paying rent.

Some of our best centers today, such as Kierland Commons, Broadway Plaza, Scottsdale Fashion Square, and Tysons Corner, are the ones that are furthest along in this elevate and transform strategy. They are meaningfully posting our strongest traffic, sales, and NOI growth as compared to the go-forward portfolio average. It is an exciting template that we are experiencing and seeing. We are confident that the mid-stage development, mid-stage transformation, and early-stage transformation assets that are following are going to experience a similar growth profile. Finally, that brings me to the concept of acquisitions, which is our external growth engine. Let me be clear on how we are approaching growth. We are extremely disciplined, extremely careful on the things that we buy, the things that we believe we can add value to through leasing, development, or intensive asset management. We want assets that are accretive to our plan.

We want assets that are accretive to 2028, and we are focused on strong trade areas and particularly where there might be a catalyst in the center to improve the direction of the property. Most importantly, we want to make sure that they can be financed within the leverage targets that we have outlined. I think what is different today, as it relates to this opportunity set, is our pipeline is basically the most robust it has been in the last two years. It is a combination of off-market and marketed transactions. On the marketed transactions side, if you were to compare malls that we have interest in today that are being marketed, they are meaningfully higher in number and volume as compared to a year ago or a year before that, when we were looking at Crabtree.

We are very confident in our ability to be very selective and very successful as it relates to external growth. With our recent equity offerings, we have the capacity to act on this pipeline in this current environment. No one is building new Class A regional malls. Capital selective and the best retailers are concentrating in the best centers. Macerich has a unique advantage that differs from many other buyers. We have a fully integrated operating and leasing platform, deep national retailer relationships, attractive cost of capital and liquidity, and the speed and certainty to close. That is why sellers or retailers have been engaging with us, most recently at this moment, just like in Crabtree and the Indianapolis case study. To summarize, we are ahead of schedule on the Path Forward plan.

We believe the plan is significantly de-risked, and we have structural tailwinds behind us in the business that will only get stronger, particularly with Gen Z and how they are showing up in the malls and with brick-and-mortar retailers. Our plan has us on track to achieve higher permanent physical occupancy, increased foot traffic, which will drive NOI, lease demand, and rental rates within our portfolio, embedded rent growth, stronger balance sheet, and a portfolio of truly irreplaceable assets in the country's most desirable markets. Our disciplined execution on the acquisition strategy and concrete steps we have taken to improve the balance sheet at the same time position us as an attractive earnings growth story for several years to come. Thank you all for your interest, and Samir will open up for questions or whatever we can talk about.