On this page of StockholderLetter.com we present the 3/27/2023 shareholder letter from KITE REALTY GROUP TRUST — ticker symbol KRG. Reading current and past KRG letters to shareholders can bring important insights into the investment thesis.

 •  3/27/2023 Letter Continued (Full PDF)
 •  4/16/2024 KRG Stockholder Letter
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 •  KRG Benford's Law Stock Score = 91

KRG 3/27/2023 Shareholder/Stockholder Letter Transcript:

ANNUAL
REPORT
2022
kiterealty.com

2022 Kite Realty Group Annual Report
To Our Fellow Shareholders,
2022 was a landmark year for Kite Realty Group Trust.
of transformational growth. The results speak for
As I write this letter, KRG sits with the strongest balance sheet in the history of our organization; our annualized
base rent (ABR) per square foot, leasing volumes, and blended cash leasing spreads are each at all-time highs;
CONNECT & COMMIT
themselves:
As we have completed a banner year and work toward

Total revenue increased over 200%, to $802
another, we approach our business and relationships,
million from $267 million.
both internal and external, with renewed energy,
FFO of the Operating Partnership, as adjusted,
optimism, and ambition. I have often stated, and
In addition, KRG has generated the highest total shareholder return in our peer group - not only during
increased 284%, to $429.6 million from $112.0
will continue to state, that KRG is nothing without our
2022, but also over the past three years. As we advance in 2023, we are in a position to fuel growth
million.
people. With our focus set on 2023 and beyond, we
and we produced the highest margins in our sector over the past year - all a clear testament to our team's
ability to consistently operate and execute at an extremely high level.
through execution of our primary core competency: leasing space in our high-quality retail portfolio. Significant


upside remains in returning portfolio leasing to pre-pandemic levels, and we are extremely well-positioned to
capitalize on the opportunity ahead.
Net debt to adjusted EBITDA improved to 5.2x
from 7.0x.

Following our strategic merger in the fourth quarter
of 2021, 2022 stood as a true barometer to validate
the merits of our transformational transaction.
A year ago, our team was optimistic about our
The true value of our enhanced portfolio is
being showcased in our performance, while
tremendous upside remains. Although disconnect
still exists in our trading multiple, we will continue
to place relentless focus on rectifying that gap and
realizing upon our embedded value.
path forward and we set our goals and forecasts
appropriately high. Despite the ambitious outlook,
our performance surpassed the elevated bar we
A PROVEN PLATFORM &
TRANSFORMATIONAL GROWTH
set for ourselves, as KRG exceeded all internal and
external expectations in 2022.
Our success is due in no small part to the strength
of our best-in-class operating platform     a critical
A few highlights:

Our FFO, as adjusted, per share of $1.93
for KRG.
ABR per square foot eclipsed $20, with ample
room for growth evidenced by the $27 per square
foot rents achieved on all comparable new leases
in 2022.
our customers, and to our communities.
As a team, we strive to always help each other,
challenge each other, and improve. A passion for
our industry and an inherent competitive nature are
ingrained in our culture. Our values serve as our
team   s guiding principles and connective tissue. And
while each individual at KRG has unique strengths
As we work to maximize value within every square
and aspirations, our collective mantra remains the
foot of our portfolio, we are dedicated to continuously
same     One Team. One Focus.
honing and improving our best practices to capitalize
on our operational upside.
At KRG, we strive to be...
Retailer investment in and dependence upon
our open-air asset type remains strong, with high
percentages of retailer sales and online fulfillment
taking place in brick-and-mortar locations. Occasional
tenancy changes are common in our cyclical industry,
We have a skilled and experienced team, devoted to
and we welcome the opportunity to bring new and
and a 21-cent increase over the midpoint of our
the details, that has built and evolved processes over
thriving retailers to our shopping centers. As we seek
original 2022 guidance.
decades to ensure efficiency and effectiveness. We
to strengthen our relationships with growing retailers
2022 same property NOI growth was 5.1%,
pair operational acumen with our high-quality,
via openings in our portfolio, availability in our portfolio
exceeding the midpoint of our original
open-air portfolio to provide the best experience
is also aggressively sought after, as evidenced by our
guidance by 310 basis points.
possible for our retailers and their customers.
2022 blended cash spreads of 18.1% for comparable
Our balance sheet grew stronger, with net debt
Over the past three years, the value of our platform
represents a 29% increase per share over 2021

component of our business and a true differentiator

and committed: to each other, to our values, to
Cash dividends per common share increased
82%, to $0.82 from $0.45.
OUTPERFORMING EXPECTATIONS
are intentionally aspiring to become more connected
F orwardthinking
We are curious, we prize innovation, and we
welcome change
O ptimistic
We begin with a positive attitude, and while
we assume the best, we prepare for the worst
C ollaborative
We are receptive to different perspectives
and are obligated to coordinate our efforts
U rgent
We are fast and persistent, but not at the
expense of accuracy
S ound
We are built on a stable foundation and
we make judgments in a measured and
thoughtful way
E mpowered
We are independent thinkers with con   dence
to take the initiative and solve problems
D edicated
We refuse to lose, we will grind till the end,
and we are never complacent
new and non-option renewals.

to EBITDA improving to 5.2x, and liquidity
has been uniquely displayed as it performed
Our business is physical, tangible, and human-
sitting at over $1 billion.
through industry turbulence and a portfolio-doubling
centric, and the value of customer relationships
merger. Since 2020, KRG has created nothing short
is paramount. We pride ourselves on our ability to
deliver for our tenants, shoppers, and communities.
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2022 Kite Realty Group Annual Report
COMPANY HIGHLIGHTS
We remain committed to our customers through
My sincere thanks to our KRG team, our Board
YEAR ENDED DECEMBER 31
strengthening relationships and improving the
of Trustees, our tenants, our shoppers, and our
Financial Data ($ in millions)
product we offer     high-quality shopping centers
shareholders for your continued trust and support.
and a best-in-class platform. KRG does not operate
It remains an honor to lead this team and a privilege
or succeed without the wholehearted dedication
to know our best days lie ahead.
of our team.
2020
2021
2022
Total Revenue
$266.6
$373.3
$802.0
FFO of the Operating Partnership, as adjusted
$112.0
$171.2
$429.6
FFO per Wtd. Avg. Diluted Common Share, as adjusted
$1.29
$1.50
$1.93
7.0x
6.0x
5.2x
Cash Dividend per Common Share
$0.45
$0.68
$0.82
Operating Properties Leased Percentage
91.4%
93.3%
94.4%
Net Debt to adjusted EBITDA
Within our communities, we humbly appreciate
the role that our shopping centers can play, often
woven into the daily and weekly lives of many. This
is one of the reasons we take pride in our impact
on the community-at-large. 2022 not only saw KRG
issue our first Corporate Responsibility Report as
we advanced our ESG efforts, but our community
HIGH-QUALITY OPEN-AIR PORTFOLIO
outreach platform, Kite Cares, produced record
impact throughout our portfolio.
Despite our success in 2022, we are just scratching
the surface of what KRG can achieve. We are in a
strong position, we have the leverage and flexibility
to be opportunistic, we are determined to succeed,
and we will fervently operate the company
183
28.8
157,462
ABR CONCENTRATION
Operating
Properties
Owned GLA
Average SF
67%
(in millions)
Sun Belt Markets2
23%
5%
with our signature focus and vigor to generate
Strategic Gateway Markets
Seattle
(D.C., Seattle, and NYC)
continued long-term value.
Recent years have served as an inflection point for
John A. Kite
the retail industry, and I strongly believe 2022 will
Chairman & Chief Executive Officer
8%
10%
Washington, D.C. /
be looked back upon as a historic and watershed
35%
Highest Growth Markets3
(since onset of pandemic)
Baltimore
period in the history of KRG.
3%
2%
5%
Las Vegas
4%
2%
Phoenix
2%
4%
San Antonio
Dallas / Fort Worth
1.
2.
3.
2%
Tampa
Houston
16%
3
New York
2%
Raleigh / Durham
Charlotte
Atlanta
2%
Orlando / Daytona
3%
Miami / Fort Lauderdale
TOP 5 STATES (ABR)
Texas
Florida
Maryland
New York
North Carolina
26%
11%
7%
6%
5%
Naples
Development and Redevelopment GLA and SF include commercial and multifamily components.
Sun Belt states include AL, AZ, CA, CO, FL, GA, KY, LA, MS, NC, NM, NV, OK, SC, TN, TX, UT and VA.
LinkedIn Economic Data representing the biggest year-over-year gains in net new arrivals between February 2021     January 2022 in the following markets:
New York City, Miami / Fort Lauderdale, Jacksonville, Orlando, Tampa, San Diego, Austin, Nashville, Dallas / Fort Worth and San Antonio.
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2022 Kite Realty Group Annual Report
KEY METRICS
KRG   S CONTINUED EVOLUTION
16.84
17.83
18.42
KEY METRICS
19.36 20.02
7.0x
2004 (IPO)
2020
TODAY
# of Retail Properties
30
83
183
# of States
9
16
24
# of Markets
16
33
49
Indianapolis - 23%
Las Vegas - 11%
Dallas / Fort Worth - 16%
$10.57
$18.42
$20.02
Marsh - 3.2%
Publix - 2.5%
TJX - 2.5%
13.2x
7.0x
5.2x
6.0x
2022
2021
2020
2022
2021
2020
2019
2018
5.2x
Top MSA (% of ABR)
ABR PSF
75%
$20.02
67%
5.2x
of ABR from assets
with a grocery
component
Annualized Base Rent
Sun Belt Exposure1
Net Debt / EBITDA
KRG ALL-TIME HIGH
KRG ALL-TIME LOW
Top Tenant (% of ABR)
Net Debt to adjusted EBITDA
OUTPERFORMING MERGER EXPECTATIONS
Projected
EFFICIENT OPERATING PLATFORM
RETAIL RECOVERY RATIO2
RETAIL NOI MARGIN
74.3%
89.4%
74.3%
87.0%
2022 FFO per Share
$1.72 (Original guidance midpoint)
$1.93 per share
2022 Same Property NOI
2.0% (Original guidance midpoint)
5.1%
Earnings Accretion
Immediate
Immediate
2022 Net Debt to EBITDA
6.0x
5.2x
Time to Return Margins to
Historical KRG Averages
~3+ years
1 year, with additional upside remaining
Lifestyle & Mixed-Use
Asset Performance
Performance would bene   t from the
"reopening trade    post pandemic
Time to Realize G&A Synergies
69.5%
Peer Average
3Q'22
76.4%
KRG
3Q'21
KRG
4Q'22
BLENDED CASH SPREADS (TTM)
12.6%
8.7%
Peer Average
3Q'22
KRG
3Q'21
G&A AS A % OF TOTAL REVENUE
5
KRG
3Q'21
Development Pipeline
12 to 18 months
    KRG   s development expertise would
provide value creation opportunities via
completion of active developments
    Right-sized for the combined company
    Additional value to be harvested from
entitled land bank
    59% comparable new leasing spreads in 2022
    Overage rent increase of $2.2M
(from 2021 to 2022, as a result of strong sales)
18 to 24 months (forecasted)
    Substantially completed 5 development projects in 2022
    $44M of remaining active development spend against
$8B enterprise value
    Successfully re-zoned land at One Loudoun to enhance
value and prepare land for future development
2022 LEASING ACTIVITY HIGHLIGHTS
11.5%
9.3%
6.8%
Peer Average
3Q'22
KRG
4Q'22
Actual
6.3%
KRG
4Q'22
Peer Average
3Q'22
KRG
3Q'21
KRG
4Q'22
1.
Based on ABR. Sun Belt states include AL, AZ, CA, CO, FL, GA, KY, LA, MS, NC, NM, NV, OK, SC, TN, TX, UT and VA.
2.
   Recovery Ratios    are computed by dividing tenant reimbursements by the sum of recoverable operating expense and real estate tax expense.
Tenant reimbursements for the three months ended December 31, 2022 have been reduced by $1.4 million due to reserves for Bed Bath & Beyond Inc. real estate tax reimbursements.
Note: Peer group includes AKR, BRX, FRT, IVT, KIM, PECO, REG, ROIC, RPT, SITC and UE. Source of all peer data is from 3Q 2022 supplemental disclosures.
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2022 Kite Realty Group Annual Report
ONE LOUDOUN
MSA: WASHINGTON, D.C.
GLA: 467,589 SF
Community-oriented mixed-use development offering
shoppers, diners, and residents the ultimate experience
in ultra-affluent Loudoun County. One Loudoun is the
premiere fashion, dining, and entertainment venue in
Northern Virginia.
In 2022, development was completed on two new pads
that included 378 multifamily units and 67k square feet
of commercial space. Additional growth of the property
remains on the horizon, with an undeveloped tract of land
now approved for 1.9 million square feet of commercial
GLA and 1,745 multifamily units.
KEY TENANTS
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 3/27/2023 Letter Continued (Full PDF)