Company: FRT-PC
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0000034903-25-000016
Chunk: 14

Company: FEDERAL REALTY INVESTMENT TRUST
Filing Date: 2025-02-13
Form: 10-K
Item: Item 1A
Chunk 14
---
 redevelop or acquire may fail to achieve the occupancy or rental rates we project, within the time frames we project, at the time we make the decision to invest, which may result in the properties’ failure to achieve the returns we projected;

•our pre-acquisition evaluation of the physical condition of each new investment may not detect certain defects or identify necessary repairs until after the property is acquired, which could significantly increase our total acquisition costs or decrease cash flow from the property; and

•our investigation of a property or building prior to our acquisition, and any representations we may receive from the seller of such building or property, may fail to reveal various liabilities, which could reduce the cash flow from the property or increase our acquisition cost.

Our performance and value are subject to general risks associated with the real estate industry.

Our economic performance and the value of our real estate assets, and consequently, the value of our investments, are subject to the risk that if our properties do not generate revenues sufficient to meet our operating expenses, including debt service and capital expenditures, our cash flow and ability to pay distributions to our shareholders will be adversely affected. As a real estate company, we are susceptible to the following real estate industry risks:

•economic downturns in general, or in the areas where our properties are located;

•adverse changes in local real estate market conditions, such as an oversupply or reduction in demand;

•changes in tenant preferences that reduce the attractiveness of our properties to tenants;

•zoning or regulatory restrictions;

•decreases in market rental rates;

•weather conditions that may increase or decrease energy costs and other weather-related expenses;

•costs associated with the need to periodically repair, renovate and re-lease space; and

•increases in the cost of adequate maintenance, insurance and other operating costs, including real estate taxes, associated with one or more properties, which may occur even when circumstances such as market factors and competition cause a reduction in revenues from one or more properties, although real estate taxes typically do not increase upon a reduction in such revenues.

Each of these risks could result in decreases in market rental rates and increases in vacancy rates, which could adversely affect our financial condition and results of operation.

Many real estate costs are fixed, even if income from our properties decreases.

Our financial results depend primarily on leasing space in our properties to tenants on terms favorable to us. Costs associated with real estate investment, such as real estate taxes, insurance and maintenance costs, generally are not reduced even when a property is not fully occupied, rental rates