4. Real Estate Acquisitions and Dispositions

Unless otherwise noted, gains and losses on property transactions are included in gain on acquisition of controlling interest, sale or disposal of, or recovery on, assets and interests in unconsolidated entities and impairment, net in the accompanying consolidated statements of operations and comprehensive income. We capitalize asset acquisition costs and expense costs related to business combinations, as well as disposition related costs as they are incurred. We incurred a minimal amount of transaction expenses during the nine months ended September 30, 2026 and 2025.

2025 Acquisitions

On November 17, 2025, we completed the acquisition of a 100% interest in a retail property, Phillips Place, located in Charlotte, North Carolina. The cash consideration including working capital was $143.8 million.  Upon acquisition, we recorded $133.3 million of investment property.  The property is unencumbered. We accounted for this transaction as an asset acquisition.

On October 31, 2025, we closed on the acquisition of the remaining 12% interest in TRG which we did not previously own in exchange for approximately 5.06 million units in the Operating Partnership.  As a result of this acquisition, we obtained control of and consolidated TRG as of the acquisition date.  TRG had an interest in 22 regional, super-regional, and outlet malls in the U.S. and Asia, 11 of which are now consolidated and 11 of which are accounted for under the equity method upon the acquisition.  The 11 consolidated properties are now reported within our Real estate segment in Note 11.  This acquisition aligns with our strategy of owning high-quality assets, unlocking operational synergies and driving further innovation.  

The acquisition was accounted for as a business combination requiring a remeasurement of our previously held 88% noncontrolling equity interest to fair value, which resulted in the recognition of a non-cash gain of $2.858 billion in the fourth quarter of 2025, which was included in gain (loss) on acquisition of controlling interest, sale, or disposal of, or recovery on, assets and interests in unconsolidated entities and impairment, net in the consolidated statement of operations and comprehensive income and the assets acquired and liabilities assumed were recognized at their acquisition date fair value.  The fair value of our previously held 88% noncontrolling equity interest was measured based primarily on the value implied by our most recent previous purchase of noncontrolling equity interests in TRG discussed in Note 6.  Refer to Note 4 of the notes to the consolidated financial statements within our 2025 Annual Report on Form 10-K for additional information related to the TRG Acquisition.

We finalized the valuation of the assets acquired and liabilities assumed as of September 30, 2026.  During the three and nine months ended September 30, 2026, we finalized our determination of the fair value of rents related to each space in each property where we are the lessor, as well as leases in which we are the lessee.  We recorded measurement period adjustments of $83.3 million, net, to decrease investment property, offset by adjustments to the underlying valuation of the lease-related intangible assets and liabilities that are recorded within Deferred costs and other assets and Accounts payable, accrued expenses, intangibles and deferred revenues on our consolidated balance sheets. 

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The following table summarizes our finalized acquisition date fair value of the assets acquired and liabilities assumed, which is based on significant inputs not observable in the market and thus represent Level 3 inputs (primarily capitalization rates used to value each of the 22 consolidated and unconsolidated properties and the noncontrolling interest value of a consolidated property).  The non-cash components of these investing and financing activities are excluded from our consolidated statement of cash flows.  

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We recognized $189.2 million and $564.4 million of total consolidated revenue and a consolidated net loss of $47.4 million and $130.0 million for the three and nine months ended September 30, 2026, respectively. Refer to Note 6 for further discussion and summarized financial information of the revenue and earnings of TRG prior to the date of acquisition.  During the three months ended September 30, 2026, we recorded an adjustment, in connection with the finalization of the valuation of assets acquired and liabilities assumed, to our preliminary estimate of depreciation and amortization expense of investment properties and in-place lease intangible assets, representing additional depreciation and amortization expense of $49.8 million.  During the three months ended September 30, 2026, we recorded additional lease income, in connection with the valuation of above and below market lease intangibles of $1.9 million, net, of which $1.4 million relates to periods prior to the three months ended September 30, 2026.  Additionally, during the three months ended September 30, 2026, we recorded a reduction to the preliminary estimate of amortization of our excess investment in unconsolidated entities, our share of which was $25.2 million.  Transaction costs in connection with this acquisition were not significant.

On June 27, 2025, we acquired the remaining 75% interest in the retail component and 100% of the parking component of Brickell City Centre, resulting in the consolidation of the retail component which had previously been accounted for under the equity method. The cash consideration for this transaction, including working capital, was $497.7 million. Cash acquired was $24.0 million. Upon consolidation, we recorded $544.6 million of investment property and lease intangible assets. The property is unencumbered.  We accounted for this transaction as an asset acquisition and the non-cash components of these investing activities are excluded from our consolidated statement of cash flows.  

On April 1, 2025, we acquired the remaining 50% interest in Briarwood Mall from a joint venture partner, resulting in the consolidation of this property. The cash consideration for this transaction, including working capital, was $9.2 million. Cash acquired was $14.7 million. Upon consolidation, we recorded $168.6 million of investment property. The property is subject to a $165 million 3.29% fixed rate mortgage loan.  We accounted for this transaction as an asset acquisition and these non-cash investing and financing activities are excluded from our consolidated statement of cash flows.  

On January 30, 2025, we completed the acquisition of a 100% interest in two luxury outlet destinations in Italy, The Mall Luxury Outlets Firenze, in Leccio, nearby Florence, and The Mall Luxury Outlets Sanremo, in Sanremo on the Italian Riviera. The cash consideration including working capital and capitalized transaction costs was $392.4 million. Cash acquired was $25.3 million. Upon acquisition, we recorded $413.5 million of investment property. The properties are unencumbered. We accounted for this transaction as an asset acquisition.