JBG SMITH Properties

Previous wording

Certain statements contained herein constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not guarantees of future performance. They represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Our future results, financial condition and business may differ materially from those expressed in these forward-looking statements. You can find many of these statements by looking for words such as "approximates," "believes," "expects," "anticipates," "estimates," "intends," "plans," "would," "may" or other similar expressions in this Quarterly Report on Form 10-Q. Many of the factors that will determine the outcome of these, and our other forward-looking statements are beyond our ability to control or predict. For further discussion of factors that could materially affect the outcome of our forward-looking statements, see "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission on February 17, 2026 ("Annual Report") and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Quarterly Report on Form 10-Q and our Annual Report.

Current wording

Certain statements contained herein constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not guarantees of future performance. They represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Our future results, financial condition and business may differ materially from those expressed in these forward-looking statements. Forward-looking statements include but are not limited to our current expectations regarding the performance of our business, our financial results, our liquidity and capital resources, including the impacts and ultimate outcome of the Wardman Park litigation and our potential need to post bonds or other forms of surety to support our legal remedies in connection with such litigation. You can find many of these statements by looking for words such as "approximates," "believes," "expects," "anticipates," "estimates," "intends," "plans," "would," "may" or other similar expressions in this Quarterly Report on Form 10-Q. Many of the factors that will determine the outcome of these, and our other forward-looking statements are beyond our ability to control or predict. For further discussion of factors that could materially affect the outcome of our forward-looking statements, see "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission ("SEC") on February 17, 2026 ("Annual Report"), as such factors may be updated from time to time in our periodic filings with the SEC, and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Quarterly Report on Form 10-Q and our Annual Report.

Previous wording

For these forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We do not undertake any obligation to release publicly any revisions to our forward-looking statements to reflect events or circumstances occurring after the date of this Quarterly Report on Form 10-Q.

Current wording

For these forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We do not undertake any obligation to release publicly

Previous wording

Substantially all our assets are held by, and our operations are conducted through JBG SMITH Properties LP, our operating partnership. JBG SMITH is referred to herein as "we," "us," "our" or other similar terms. References to "our share" refer to our ownership percentage of consolidated and unconsolidated assets in real estate ventures, but exclude our 10.0% subordinated interest in one commercial building and our 33.5% subordinated interest in four commercial buildings, as well as the associated non-recourse mortgage loans, held through unconsolidated real estate ventures; these interests and debt are excluded because our investment in each real estate venture is zero, we do not anticipate receiving any near-term cash flow distributions from the real estate ventures, and we have not guaranteed their obligations or otherwise committed to providing financial support.

Current wording

Substantially all our assets are held by, and our operations are conducted through JBG SMITH Properties LP, our operating partnership. JBG SMITH is referred to herein as "we," "us," "our" or other similar terms. References to "our share" refer to our ownership percentage of consolidated and unconsolidated assets in real estate ventures, but exclude our 33.5% subordinated interest in four commercial buildings, as well as the associated non-recourse mortgage loans, held through an unconsolidated real estate venture; the interest and debt are excluded because our investment in the real estate venture is zero, we do not anticipate receiving any near-term cash flow distributions from the real estate venture, and we have not guaranteed its obligations or otherwise committed to providing financial support.

Previous wording

References to our financial statements refer to our unaudited condensed consolidated financial statements as of March 31, 2026 and December 31, 2025, and for the three months ended March 31, 2026 and 2025. References to our balance sheets refer to our condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025. References to our statements of operations refer to our condensed consolidated statements of operations for the three months ended March 31, 2026 and 2025. References to our statements of cash flows refer to our condensed consolidated statements of cash flows for the three months ended March 31, 2026 and 2025.

Current wording

References to our financial statements refer to our unaudited condensed consolidated financial statements as of June 30, 2026 and December 31, 2025, and for the three and six months ended June 30, 2026 and 2025. References to our balance sheets refer to our condensed consolidated balance sheets as of June 30, 2026 and December 31, 2025. References to our statements of operations refer to our condensed consolidated statements of operations for the three and six months ended June 30, 2026 and 2025. References to our statements of cash flows refer to our condensed consolidated statements of cash flows for the six months ended June 30, 2026 and 2025.

Previous wording

Our revenues and expenses are, to some extent, subject to seasonality during the year, which impacts quarterly net earnings, cash flows and funds from operations; this seasonality affects the sequential comparison of our results in individual quarters over time. For instance, we have historically experienced higher utility costs in the first and third quarters of the year.

Current wording

Our revenue and expenses are, to some extent, subject to seasonality during the year, which impacts quarterly net earnings, cash flows and funds from operations; this seasonality affects the sequential comparison of our results in individual quarters over time. For instance, we have historically experienced higher utility costs in the first and third quarters of the year.

Previous wording

As of March 31, 2026, our Operating Portfolio consisted of 38 operating assets comprising 15 multifamily assets totaling 6,519 units (6,333 units at our share), 22 commercial assets totaling 7.3 million square feet (6.9 million square feet at our share) and one wholly owned land asset for which we are the ground lessor. Additionally, our development pipeline, which consists of owned and entitled land on which we have the potential to commence construction subject to completion of design and/or market conditions, totaled 4.6 million square feet (3.3 million square feet at our share) of estimated potential development density. Our development pipeline excludes unentitled land parcels and land parcels controlled through an option agreement.

Current wording

share) and one wholly owned land asset for which we are the ground lessor. Additionally, we had one under-construction multifamily asset with 195 units (59 units at our share), and our development pipeline, which consists of owned and entitled land on which we have the potential to commence construction subject to completion of design and/or market conditions, totaled 4.8 million square feet (3.5 million square feet at our share) of estimated potential development density. Our development pipeline excludes unentitled land parcels and land parcels controlled through an option agreement.

Previous wording

Our capital allocation strategy remains anchored in our core objective of maximizing long-term net asset value ("NAV") per share growth. Drawing on our deep expertise in mixed-use, urban infill real estate, we have consistently rotated across asset classes based on relative value, cost of capital and risk-adjusted return potential. In today’s market environment, we believe that distressed office investment opportunities offer compelling economics. Consequently, we are actively pursuing new growth opportunities that align with our strategy and leverage our competitive strengths as a mixed-use owner, operator and developer. We expect to fund growth opportunities through a combination of asset sales and private equity joint ventures. During the three months ended March 31, 2026, we sold a development parcel for gross sales proceeds of $50.7 million. In April 2026, we recapitalized Tysons Dulles Plaza, which follows through on our plan to attract private capital

Current wording

Our capital allocation strategy remains focused on enhancing long-term shareholder value and positioning our portfolio for sustained long-term net asset value ("NAV") per share growth. Drawing on our deep expertise in mixed-use, urban infill real estate, we have consistently rotated across asset classes based on relative value, cost of capital and risk-adjusted return potential. In today’s market environment, we believe that distressed office investment opportunities offer compelling economics. Consequently, we are actively pursuing new growth opportunities that align with our strategy and leverage our competitive strengths as a mixed-use owner, operator and developer. We expect to fund growth opportunities through a combination of asset sales and private equity joint ventures. During the six months ended June 30, 2026, we sold a development parcel, and we sold a 70.0% interest in 2200 Crystal Drive to an unconsolidated real estate venture for total gross sales proceeds of $60.6 million, and we recapitalized Tysons Dulles Plaza by selling a 50.0% noncontrolling interest in a consolidated real estate venture. These real estate ventures further our goal of attracting private capital partners to scale and diversify our distressed office investment strategy and fund the construction of multifamily assets in our development pipeline while also enhancing the efficiency of our platform with incremental fee revenue and potential carried interest income.

Previous wording

We intend to continue to opportunistically sell or recapitalize assets (which may be multifamily, commercial and/or retail assets) as well as land sites where a ground lease or joint venture execution may represent the most attractive path to maximizing value. In a climate where office valuations are near cyclical lows with limited liquidity, the most efficiently priced source of capital will likely come from our multifamily assets. To that end, we are currently marketing for sale select multifamily and land assets.

Current wording

We intend to continue to opportunistically sell or recapitalize assets (which may be multifamily, commercial and/or retail assets) as well as land sites where a ground lease or joint venture execution may represent the most attractive path to maximizing value.

Previous wording

During the first quarter of 2026, we began to see improvements in our multifamily portfolio occupancy, which had experienced softness largely as a result of job losses primarily in the District of Columbia in 2025 due to federal government spending cuts and a hiring freeze. Our same store multifamily portfolio occupancy was 92.0% as of March 31, 2026, an increase of 160 basis points as compared to December 31, 2025. During the first quarter of 2026, effective rents, which represent the average change in rental rates versus expiring rental rates net of concessions, decreased by 10.5% for new leases and increased by 1.9% upon renewal while achieving a 62.4% renewal rate across our portfolio. Our recently delivered assets, The Zoe and Valen, which were placed into service in 2025, were 47.4% leased as of March 31, 2026. As a result of these deliveries, interest expense has increased for these assets as we have ceased capitalizing the related interest expense.

Current wording

In 2026, we began to see some modest improvement in our multifamily portfolio leasing, which had experienced softness largely as a result of job losses primarily in the District of Columbia in 2025 due to federal government spending cuts and a hiring freeze. Our same store multifamily portfolio was 94.3% leased as of June 30, 2026, up 80 basis points as compared to March 31, 2026. Our same store multifamily portfolio was 92.0% occupied as of June 30, 2026, flat as compared to March 31, 2026. During the second quarter of 2026, effective rents, which represent the average change in rental rates versus expiring rental rates net of concessions, decreased by 9.5% for new leases and increased by 2.8% upon renewal while achieving a 55.9% renewal rate across our portfolio. We continue to make progress leasing our recently completed assets — The Grace and Reva were 90.4% leased, and The Zoe and Valen were 58.8% leased as of June 30, 2026.

Previous wording

Our office portfolio occupancy was 75.2% as of March 31, 2026, an increase of 10 basis points as compared to December 31, 2025. Leasing activity in our National Landing portfolio continues to be driven primarily by office users who fall into three categories (i) tenants who require secure facility space; (ii) technology-related tenants; and (iii) defense-related tenants who have long resided in this submarket. Our leasing efforts continue to focus on buildings with long-term potential, concentrating occupancy in areas of National Landing that are accessible via multi-modal transportation and that we have enhanced through our placemaking interventions, including the delivery of our new office amenity hub at 2011 Crystal Drive. We expect to help foster a healthier long-term office market by repurposing older, underutilized office buildings for redevelopment or conversion to multifamily housing, hospitality and other complimentary uses that will support a vibrant mixed-use environment. We have already executed on this strategy at 1900 Crystal Drive and 2001 Richmond Highway, two obsolete office buildings we demolished and redeveloped into our new multifamily assets currently in lease up — The Grace, Reva, The Zoe and Valen. We have broadened this approach to four additional assets through adaptive reuse and conversion: 2100 Crystal Drive, which we entitled for conversion into a 345-key, dual-branded hotel and subsequently sold to a hotel developer; 2200 Crystal Drive, which we plan to convert into a 195-unit multifamily asset; and 1800 and 1901 South Bell Street, which we are in the process of entitling for conversion into multifamily.

Current wording

Our office portfolio was 75.4% occupied as of June 30, 2026, an increase of 20 basis points as compared to March 31, 2026. During the three months ended June 30, 2026, we executed 151,000 square feet of office leases at our share. Leasing activity in our National Landing portfolio continues to be driven primarily by office users who fall into three categories (i) tenants who require secure facility space; (ii) technology-related tenants; and (iii) defense-related tenants who have long resided in this submarket. To support a healthier long-term office market in National Landing, we have reduced our office inventory by more than 25% since our formation by repurposing older, underutilized office buildings for redevelopment or conversion to multifamily housing, hospitality and other complementary uses that create a vibrant mixed-use environment. At 1900 Crystal Drive and 2001 Richmond Highway, we demolished two obsolete office buildings and developed the sites into four new multifamily assets currently in lease up — The Grace, Reva, The Zoe, and Valen. We redeveloped 1770 Crystal Drive, an aging office property, into a best-in-class office building that was 100.0% pre-leased to Amazon and remains fully leased to Amazon today. More recently, we expanded this strategy through adaptive reuse and conversion of four obsolete office

Previous wording

We have 4.6 million square feet (3.3 million square feet at our share) of estimated potential development density in our development pipeline and intend to seek joint venture capital to fund these developments as market conditions permit.

Current wording

We have 4.8 million square feet (3.5 million square feet at our share) of estimated potential development density in our development pipeline and intend to seek joint venture capital to fund these developments as market conditions permit.

Previous wording

Key highlights for the three months ended March 31, 2026 included:

Current wording

Key highlights for the three and six months ended June 30, 2026 included:

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Additionally, investing and financing activity during the three months ended March 31, 2026 included:

Current wording

Additionally, investing and financing activity during the six months ended June 30, 2026 included:

Previous wording

Our Annual Report contains a description of our critical accounting estimates, including asset acquisitions, real estate, investments in real estate ventures and revenue recognition. There have been no significant changes to our policies during the three months ended March 31, 2026.

Current wording

Our Annual Report contains a description of our critical accounting estimates, including asset acquisitions, real estate, investments in real estate ventures and revenue recognition. There have been no significant changes to our policies during the six months ended June 30, 2026.

Previous wording

In 2025, we sold 8001 Woodmont, WestEnd25 and The Batley. We collectively refer to these assets as the "Disposed Properties" in the discussion below. In 2025, we acquired Tysons Dulles Plaza and the remaining 45.0% interest in an unconsolidated real estate venture that owned 1101 17th Street. In 2025, we began leasing The Zoe and Valen, and in 2024, we began leasing The Grace and Reva.

Current wording

In 2026, we sold an interest in 2200 Crystal Drive to an unconsolidated real estate venture. In 2025, we sold 8001 Woodmont, WestEnd25 and The Batley. We collectively refer to these assets as the "Disposed Properties" in the discussion below. In 2025, we acquired Tysons Dulles Plaza, which was recapitalized in April 2026 through the formation of a consolidated real estate venture, and the remaining 45.0% interest in an unconsolidated real estate venture that owned 1101 17th Street. In 2025, we began leasing The Zoe and Valen, and in 2024, we began leasing The Grace and Reva.

Previous wording

Third-party real estate services revenue, including reimbursements, increased by approximately $2.3 million, or 15.4%, to $17.2 million in 2026 from $14.9 million in 2025. The increase was primarily due to a $2.2 million increase in reimbursement revenue.

Current wording

Third-party real estate services revenue, including reimbursements, increased by approximately $2.2 million, or 14.8%, to $17.0 million in 2026 from $14.8 million in 2025. The increase was primarily due to a $2.1 million increase in reimbursement revenue.

Previous wording

Depreciation and amortization expense decreased by approximately $2.3 million, or 4.8%, to $45.3 million in 2026 from $47.6 million in 2025. The decrease was primarily due to (i) a $2.3 million decrease related to the Disposed Properties, (ii) a $1.8 million decrease related to certain assets being either fully depreciated or written off in 2025 and (iii) a $1.4 million decrease related to 2011 Crystal Drive primarily due to the acceleration of depreciation for certain assets associated with an early termination in 2025. The decrease in depreciation and amortization expense was partially offset by (iv) a $2.3 million increase as The Zoe and Valen were placed into service and (v) a $1.5 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street.

Current wording

Depreciation and amortization expense decreased by approximately $2.8 million, or 5.8%, to $44.8 million in 2026 from $47.6 million in 2025. The decrease was primarily due to (i) a $2.6 million decrease related to the Disposed Properties, (ii) a $1.4 million decrease related to 2011 Crystal Drive primarily due to the acceleration of depreciation for certain assets associated with an early termination in 2025 and (iii) a $1.4 million decrease related to certain assets being either fully depreciated or written off in 2025. The decrease in depreciation and amortization expense was partially offset by (iv) a $2.1 million increase as Valen was placed into service and (v) a $683,000 increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street.

Previous wording

Property operating expense increased by approximately $2.8 million, or 8.3%, to $36.2 million in 2026 from $33.4 million in 2025. The increase was primarily due to a $5.0 million increase in property operating expense from our commercial assets, partially offset by a $2.0 million decrease in other property operating expense and a $153,000 decrease from our multifamily assets. The increase in property operating expense from our commercial assets was primarily due to a $2.2 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, and higher operating expenses primarily due to utilities. The decrease in property operating expense from our multifamily assets was primarily due to a $2.6 million decrease related to the Disposed Properties, partially offset by a $1.3 million increase related to the continued lease up of The Grace, Reva, The Zoe and Valen, and higher utilities across the portfolio.

Current wording

Property operating expense increased by approximately $1.1 million, or 3.1%, to $36.0 million in 2026 from $34.9 million in 2025. The increase was primarily due to a $1.3 million increase in other property operating expense and a $130,000 increase in property operating expense from our commercial assets, partially offset by a $351,000 decrease from our multifamily assets. The increase in other property operating expense was primarily due to a $2.3 million increase associated with tenant-related construction management projects, partially offset by a $442,000 decrease related to sold development parcels. The increase in property operating expense from our commercial assets was primarily due to a $1.6 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, partially offset by a decrease associated with tenant-related construction management projects. The decrease in property operating expense from our multifamily assets was primarily due to a $2.1 million decrease related to the Disposed Properties, partially offset by a $1.2 million increase related to the continued lease up of The Grace, Reva, The Zoe and Valen, and higher operating expenses primarily due to utilities.

Previous wording

Impairment loss of $1.5 million in 2026 was related to a land asset, which was written down to its estimated fair value. Impairment loss of $8.5 million in 2025 was related to a development parcel, which was written down to its estimated fair value.

Current wording

Impairment loss of $44.1 million in 2026 was related to the impairment of capitalized costs associated with a pre-development project whose future development was determined to no longer be probable as of June 30, 2026. Impairment loss of $31.8 million in 2025 was related to The Batley, which was written down to its estimated fair value.

Previous wording

Property rental revenue increased by approximately $4.4 million, or 4.3%, to $105.9 million in 2026 from $101.5 million in 2025. The increase was primarily due to a $12.5 million increase in revenue from our commercial assets, partially offset by a $5.3 million decrease in revenue from our multifamily assets and a $2.8 million decrease in other revenue. The increase in revenue from our commercial assets was primarily due to a $5.7 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, a $3.6 million increase related to 2011 Crystal Drive due to the acceleration of lease incentives and deferred rent associated with an early termination in 2025 and a $1.5 million increase in lease termination revenue. The decrease in revenue from our multifamily assets was primarily due to a $9.1 million decrease related to the Disposed Properties and lower occupancy across the portfolio, partially offset by a $4.3 million increase related to the continued lease up of The Grace, Reva, The Zoe and Valen.

Current wording

Property rental revenue increased by approximately $4.5 million, or 2.2%, to $212.5 million in 2026 from $208.0 million in 2025. The increase was primarily due to a $15.6 million increase in revenue from our commercial assets, partially offset by a $9.2 million decrease in revenue from our multifamily assets and a $1.9 million decrease in other revenue. The increase in revenue from our commercial assets was primarily due to a $9.2 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, and a $6.9 million increase related to 2011 Crystal Drive and 1550 Crystal Drive due to the acceleration of lease incentives and deferred rent, as well as the recognition of lease termination revenue, associated with early terminations. The decrease in revenue from our multifamily assets was primarily due to a $16.0 million decrease related to the Disposed Properties and lower occupancy primarily at RiverHouse Apartments, partially offset by an $8.2 million increase related to the continued lease up of The Grace, Reva, The Zoe and Valen.

Previous wording

Real estate taxes expense decreased by approximately $126,000, or 1.0%, to $12.0 million in 2026 from $12.2 million in 2025. The decrease was primarily due to an $896,000 decrease related to the Disposed Properties and lower property tax assessments for certain assets, partially offset by a $534,000 increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, and a $524,000 increase related to The Zoe and Valen, which were placed into service.

Current wording

Real estate taxes expense decreased by approximately $468,000, or 1.9%, to $24.4 million in 2026 from $24.8 million in 2025. The decrease was primarily due to a $1.6 million decrease related to the Disposed Properties and lower property tax assessments for certain assets, partially offset by a $1.1 million increase related to The Zoe and Valen, which were placed into service, and an $814,000 increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street.

Previous wording

General and administrative expense: corporate and other decreased by approximately $270,000, or 1.7%, to $15.3 million in 2026 from $15.6 million in 2025. The decrease was primarily due to lower compensation expenses.

Current wording

General and administrative expense: corporate and other decreased by approximately $1.6 million, or 4.9%, to $30.7 million in 2026 from $32.3 million in 2025. The decrease was primarily due to a decrease in professional fees and other overhead expenses and lower compensation expenses, partially offset by a decrease in capitalized payroll.

Previous wording

General and administrative expense: third-party real estate services increased by approximately $927,000, or 5.8%, to $17.0 million in 2026 from $16.1 million in 2025. The increase was primarily due to higher third-party reimbursable expenses, partially offset by lower overhead expenses and lower compensation expenses.

Current wording

General and administrative expense: third-party real estate services increased by approximately $3.7 million, or 12.6%, to $33.4 million in 2026 from $29.6 million in 2025. The increase was primarily due to higher third-party reimbursable expenses of $4.4 million, partially offset by lower overhead expenses.

Previous wording

Transaction and other costs increased by approximately $7.9 million to $9.8 million in 2026 from $1.9 million in 2025. The increase was primarily due to a charge of $9.5 million, net of expected insurance recoveries, related to a criminal fraud scheme involving AI-enabled employee impersonation, which led to fraudulently induced wire transfers. See Note 12 to the financial statements for additional information.

Current wording

Transaction and other costs increased by approximately $5.8 million, or 121.3%, to $10.5 million in 2026 from $4.8 million in 2025. The increase was primarily due to (i) a $9.5 million charge, net of insurance recoveries, related to a criminal fraud scheme involving AI-enabled employee impersonation, which led to fraudulently induced wire transfers, partially offset by (ii) a $2.0 million decrease in completed, potential and pursued transaction expenses, and (iii) a $1.4 million decrease in severance and other costs. See Note 12 to the financial statements for additional information.

Previous wording

Interest expense increased by approximately $348,000, or 1.0%, to $35.5 million in 2026 from $35.2 million in 2025. The increase was primarily due to (i) a $2.0 million decrease in capitalized interest primarily related to Valen, which was placed into service, (ii) a $1.8 million increase due to higher interest expense on our term loans and a higher outstanding balance on our revolving credit facility, (iii) a $509,000 increase related to the consolidation of 1101 17th Street and (iv) a $205,000 increase due to draws on the mortgage loan related to The Zoe and Valen. The increase in interest expense was partially offset by (v) a $1.7 million decrease related to mortgage loans on the Disposed Properties, (vi) a $1.4 million decrease related to the RiverHouse Apartments refinancing in March 2025 and (vii) a $1.1 million decrease related to variable rate mortgage loans.

Current wording

Interest expense increased by approximately $806,000, or 1.1%, to $71.6 million in 2026 from $70.8 million in 2025. The increase was primarily due to (i) a $4.0 million decrease in capitalized interest primarily related to Valen, which was placed into service, (ii) a $1.1 million increase due to higher interest expense on our term loans and revolving credit facility, (iii) a $1.0 million increase related to the consolidation of 1101 17th Street, (iv) a $572,000 increase due to draws on the mortgage loan related to The Zoe and Valen and (v) a $248,000 increase due to a new mortgage loan related to Tysons Dulles Plaza. The increase in interest expense was partially offset by (vi) a $2.7 million decrease related to mortgage loans on the Disposed Properties, (vii) a $2.0 million decrease related to variable rate mortgage loans and (viii) a $1.4 million decrease related to the RiverHouse Apartments refinancing in March 2025.

Previous wording

Gain on the sale of real estate of $21.1 million in 2026 was due to the sale of a development parcel. Gain on the sale of real estate of $537,000 in 2025 was due to a gain related to prior year dispositions, partially offset by the loss on the sale of 8001 Woodmont.

Current wording

Gain on the sale of real estate of $20.8 million in 2026 was primarily due to the sale of a development parcel. Gain on the sale of real estate of $42.4 million in 2025 was primarily due to the sale of WestEnd25.

Previous wording

Information provided on a same store basis includes the results of properties that are owned, operated and in-service for the entirety of both periods being compared, which excludes disposed properties or properties for which significant redevelopment, renovation or repositioning occurred during either of the periods being compared. During the three months ended March 31, 2026, our same store pool decreased to 32 properties from 33 properties due to 1831/1861 Wiehle Avenue being taken out of service. While there is judgment surrounding changes in designations, a property is removed from the same store pool when the property is considered to be under construction because it is undergoing significant redevelopment or renovation pursuant to a formal plan or is being repositioned in the market and such renovation or repositioning is expected to have a significant impact on property NOI. A development property or under-construction property is moved to the same store pool once a substantial portion of the growth expected from the development or redevelopment is reflected in both the current and comparable prior year period. Acquisitions are moved into the same store pool once we have owned

Current wording

property is considered to be under construction because it is undergoing significant redevelopment or renovation pursuant to a formal plan or is being repositioned in the market and such renovation or repositioning is expected to have a significant impact on property NOI. A development property or under-construction property is moved to the same store pool once a substantial portion of the growth expected from the development or redevelopment is reflected in both the current and comparable prior year period. Acquisitions are moved into the same store pool once we have owned the property for the entirety of the comparable periods and the property is not under significant development or redevelopment.

Previous wording

Same store NOI decreased $2.7 million, or 4.8%, to $54.3 million for the three months ended March 31, 2026 from $57.1 million for the same period in 2025. The decrease was substantially attributable to (i) lower occupancy and higher utilities expense in our multifamily portfolio and (ii) higher utilities expense and increased rent abatement, partially offset by lower real estate tax expense in our commercial portfolio.

Current wording

Same store NOI decreased $2.3 million, or 4.0%, to $54.8 million for the three months ended June 30, 2026 from $57.0 million for the same period in 2025. Same store NOI decreased $5.0 million, or 4.4%, to $109.1 million for the six months ended June 30, 2026 from $114.1 million for the same period in 2025. The decreases were substantially attributable to (i) lower rental revenue and higher real estate taxes and utilities expense in our multifamily portfolio; and (ii) lower rental revenue, partially offset by lower real estate taxes in our commercial portfolio.

Previous wording

Multifamily: Property revenue at our share decreased by $6.9 million, or 12.5%, to $48.3 million in 2026 from $55.2 million in 2025. NOI at our share decreased by $7.1 million, or 21.3%, to $26.4 million in 2026 from $33.5 million in 2025. The decreases in property revenue at our share and NOI at our share were primarily due to the Disposed Properties, partially offset by the continued lease up of The Grace, Reva, The Zoe and Valen.

Current wording

Multifamily: Property revenue at our share decreased by $4.7 million, or 8.6%, to $49.6 million in 2026 from $54.2 million in 2025. NOI at our share decreased by $4.4 million, or 14.2%, to $26.6 million in 2026 from $31.0 million in 2025. The decreases in property revenue at our share and NOI at our share were primarily due to the Disposed Properties, partially offset by the continued lease up of The Grace, Reva, The Zoe and Valen.

Previous wording

Commercial: Property revenue at our share increased by $6.2 million, or 11.6%, to $59.7 million in 2026 from $53.5 million in 2025. The increase in property revenue at our share was primarily due to the acquisitions of Tysons Dulles Plaza and Dulles View, and the consolidation of 1101 17th Street. NOI at our share increased by $1.9 million, or 5.8%, to $34.8 million in 2026 from $32.9 million in 2025. The increase in NOI at our share was primarily due to the acquisitions of Tysons Dulles Plaza and Dulles View, and the consolidation of 1101 17th Street, partially offset by higher property operating expenses primarily due to higher utilities across the portfolio.

Current wording

Commercial: Property revenue at our share increased by $4.5 million, or 4.1%, to $114.2 million in 2026 from $109.7 million in 2025. The increase in property revenue at our share was primarily due to the acquisitions of Tysons Dulles Plaza and Dulles View, and the consolidation of 1101 17th Street. NOI at our share increased by $1.4 million, or 2.1%, to $69.3 million in 2026 from $67.8 million in 2025. The increase in NOI at our share was primarily due to the acquisitions of Tysons Dulles Plaza and Dulles View, and the consolidation of 1101 17th Street, partially offset by higher property operating expenses primarily due to higher utilities across the portfolio.

Previous wording

Third-party real estate services revenue, excluding reimbursements, increased by $124,000, or 1.9%, to $6.5 million in 2026 from $6.4 million in 2025. The increase was primarily due to a $497,000 increase in asset management fees, partially offset by a $286,000 decrease in leasing fees. Third-party real estate services expenses, excluding reimbursements, decreased by $1.2 million, or 16.5%, to $6.0 million in 2026 from $7.2 million in 2025. The decrease was primarily due to lower overhead expenses and lower compensation expenses.

Current wording

Third-party real estate services revenue, excluding reimbursements, increased by $426,000, or 3.2%, to $13.7 million in 2026 from $13.2 million in 2025. The increase was primarily due to a $940,000 increase in asset management fees, a $410,000 increase in other service revenue and a $225,000 increase in property management fees, partially offset by a $1.0 million decrease in leasing fees. Third-party real estate services expenses, excluding reimbursements, decreased by $348,000, or 2.8%, to $12.3 million in 2026 from $12.6 million in 2025. The decrease was primarily due to lower overhead expenses, partially offset by higher compensation expenses.

Previous wording

As of March 31, 2026 and December 31, 2025, our unsecured revolving credit facility and term loans totaling $1.5 billion consisted of a $750.0 million revolving credit facility maturing in June 2027, a $200.0 million term loan ("Tranche A-1 Term Loan") maturing in January 2027, as extended in January 2026, a $400.0 million term loan ("Tranche A-2 Term Loan") maturing in January 2028 and a $120.0 million term loan ("2023 Term Loan") maturing in June 2028. We have the option to increase the $750.0 million revolving credit facility or add term loans up to $500.0 million. The revolving credit facility has two six-month extension options.

Current wording

As of June 30, 2026 and December 31, 2025, our unsecured revolving credit facility and term loans totaling $1.5 billion consisted of a $750.0 million revolving credit facility maturing in June 2027, a $200.0 million term loan ("Tranche A-1 Term Loan") maturing in January 2027, a $400.0 million term loan ("Tranche A-2 Term Loan") maturing in January 2028 and a $120.0 million term loan ("2023 Term Loan") maturing in June 2028. We have the option to increase the $750.0 million revolving credit facility or add term loans up to $500.0 million. The revolving credit facility has two six-month extension options.

Previous wording

Our Board of Trustees has authorized the repurchase of up to $2.0 billion of our outstanding common shares. During the three months ended March 31, 2026, we repurchased and retired 1.6 million common shares for $25.4 million, a weighted average purchase price per share of $15.47. During the three months ended March 31, 2025, we repurchased and retired 12.2 million common shares for $187.5 million, a weighted average purchase price per share of $15.43. Since we began the

Current wording

Our Board of Trustees has authorized the repurchase of up to $2.0 billion of our outstanding common shares. During the three and six months ended June 30, 2026, we repurchased and retired 208,565 and 1.8 million common shares for $3.0 million and $28.4 million, a weighted average purchase price per share of $14.37 and $15.35. During the three and six months ended June 30, 2025, we repurchased and retired 11.2 million and 23.3 million common shares for $184.9 million and $372.4 million, a weighted average purchase price per share of $16.54 and $15.96. Since we began the share repurchase program through June 30, 2026, we have repurchased and retired 85.5 million common shares for $1.6 billion, a weighted average purchase price per share of $18.72.

Previous wording

Purchases under the program are made either in the open market or in privately negotiated transactions from time to time as permitted by federal securities laws and other legal requirements. The timing, manner, price and amount of any repurchases will be determined by us at our discretion and will be subject to economic and market conditions, share price, applicable legal requirements and other factors. The program may be suspended or discontinued at our discretion without prior notice.

Current wording

Purchases under the program are made either in the open market or in privately negotiated transactions from time to time as permitted by federal securities laws and other legal requirements. The timing, manner, price and amount of any repurchases will be determined by us at our discretion and will be subject to economic and market conditions, share price,

Previous wording

During the three months ended March 31, 2026, there were no significant changes to the material cash requirements information presented in Item 7 of Part II of our Annual Report.

Current wording

During the six months ended June 30, 2026, there were no significant changes to the material cash requirements information presented in Item 7 of Part II of our Annual Report.

Previous wording

Cash Flows for the Three Months Ended March 31, 2026

Current wording

Cash Flows for the Six Months Ended June 30, 2026

Previous wording

Cash and cash equivalents, and restricted cash increased $11.6 million to $114.9 million as of March 31, 2026, compared to $103.3 million as of December 31, 2025. This increase resulted from $24.0 million of net cash provided by investing activities and $3.4 million of net cash provided by operating activities, partially offset by $15.8 million of net cash used in financing activities.

Current wording

Cash and cash equivalents, and restricted cash increased $4.8 million to $108.1 million as of June 30, 2026, compared to $103.3 million as of December 31, 2025. This increase resulted from $19.2 million of net cash provided by operating

Previous wording

Net cash provided by operating activities of $3.4 million comprised: (i) $12.7 million of net income (before $56.8 million of non-cash items and a $21.1 million gain on the sale of real estate) and (ii) $594,000 of return on capital from unconsolidated real estate ventures, partially offset by (iii) $9.9 million of net change in operating assets and liabilities. Non-cash income adjustments of $56.8 million primarily include depreciation and amortization expense and share-based compensation expense.

Current wording

Net cash provided by operating activities of $19.2 million comprised: (i) $33.7 million of net income (before $150.0 million of non-cash items and a $20.8 million gain on the sale of real estate) and (ii) $881,000 of return on capital from unconsolidated real estate ventures, partially offset by (iii) $15.3 million of net change in operating assets and liabilities. Non-cash income adjustments of $150.0 million primarily include depreciation and amortization expense, impairment loss and share-based compensation expense.

Previous wording

Net cash provided by investing activities of $24.0 million primarily comprised: (i) $46.6 million of proceeds from the sale of real estate, partially offset by (ii) $23.2 million of development costs, construction in progress and real estate additions.

Current wording

Net cash provided by investing activities of $6.9 million primarily comprised: (i) $46.6 million of proceeds from the sale of real estate, partially offset by (ii) $43.1 million of development costs, construction in progress and real estate additions.

Previous wording

Net cash used in financing activities of $15.8 million primarily comprised: (i) $35.0 million of repayments on the revolving credit facility, (ii) $25.4 million of common shares repurchased, (iii) $10.4 million of dividends paid to common shareholders and (iv) $3.4 million of distributions to redeemable noncontrolling interests, partially offset by (v) $60.0 million of borrowings under the revolving credit facility.

Current wording

Net cash used in financing activities of $21.4 million primarily comprised: (i) $80.0 million of repayments on the revolving credit facility, (ii) $28.4 million of common shares repurchased, (iii) $20.7 million of dividends paid to common shareholders and (iv) $7.0 million of distributions to redeemable noncontrolling interests, partially offset by (v) $85.0 million of borrowings under the revolving credit facility, (vi) $24.4 million of borrowings under mortgage loans and (vii) $11.8 million of proceeds from the sale of a noncontrolling interest in Tysons Dulles Plaza.