ACADIA REALTY TRUST

1. Organization, Basis of Presentation and Summary of Significant Accounting Policies

Organization

Acadia Realty Trust (the “Trust”, collectively with its consolidated subsidiaries, the “Company”), a Maryland real estate investment trust (“REIT”), is a fully-integrated equity real estate investment trust focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States.

The Company owns and operates a high-quality real estate portfolio, primarily comprised of street and open-air retail assets in the nation’s most dynamic retail corridors (the “REIT Portfolio”). This portfolio is complemented by an investment management platform that leverages institutional capital relationships to pursue opportunistic, high-yield, and/or value-add investments (“Investment Management”). As of September 30, 2026, the Company held ownership interests in 190 REIT Portfolio properties (including properties in various stages of development and redevelopment) and 47 Investment Management properties across the United States.

All of the Company’s assets are held by, and its operations are conducted through, Acadia Realty Limited Partnership (the “Operating Partnership”) and entities in which the Operating Partnership owns an interest. At September 30, 2026 and December 31, 2025, the Trust controlled approximately 96% of the Operating Partnership as the sole general partner and is entitled to share in the cash distributions and profits and losses of the Operating Partnership in proportion to its percentage interest.

The remaining interests are held by limited partners, consisting primarily of entities or individuals that contributed interests in certain properties or entities to the Operating Partnership in exchange for common or preferred units of limited partnership interest (“Common OP Units” or “Preferred OP Units”), as well as employees who have been granted restricted Common OP Units (“LTIP Units”) as long-term incentive compensation (Note 13). Limited partners holding Common OP and LTIP Units generally have the right to exchange their units on aone-for-one basis for common shares of beneficial interest, par value $0.001 per share, of the Company (“Common Shares”). This structure is referred to as an umbrella partnership REIT or “UPREIT.”

The Investment Management platform operates through the Company’s consolidated opportunity funds, including: Acadia Strategic Opportunity Fund III LLC (“Fund III”), Acadia Strategic Opportunity Fund IV LLC (“Fund IV”), and Acadia Strategic Opportunity Fund V LLC (“Fund V” and, collectively with Fund III and Fund IV, the “Funds”), as well as legacy investments associated with Acadia Strategic Opportunity Fund II LLC (“Fund II”), including the City Point property, which is now directly owned and presented within Other Investment Management properties. The platform also includes seven unconsolidated co-investment vehicles with institutional partners in which the Company holds equity ownership interests ranging from 5% to 20% (Note 4). The Company consolidates the Funds as variable interest entities, as it is the primary beneficiary through its role as sole general partner or managing member.

The Operating Partnership earns fees or priority distributions for asset management, property management, construction, development, leasing, and legal services provided to the Funds. Cash flows from the Funds are distributed pro-rata to partners and members (including the Operating Partnership) until each receives a cumulative preferred return (“Preferred Return”) and full return of capital. Thereafter, remaining cash flows are distributed 20% to the Operating Partnership (“Promote”) and 80% to the partners or members (including the Operating Partnership). All intercompany transactions between the Funds and the Operating Partnership are eliminated in consolidation.

The following table summarizes the general terms and Operating Partnership’s equity interests in the Funds (dollars in millions):

(a)

Represents the total for the Funds, including the Operating Partnership and noncontrolling interests’ share. All returns and distributions referenced are presented net of fees and promote.

(b)

Amount represents the current economic ownership as of September 30, 2026, which could differ from the stated legal ownership based upon the cumulative preferred returns of the respective Fund.

Basis of Presentation

The interim Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required for complete annual financial statements. Operating results for interim periods are not necessarily indicative of results for the full fiscal year. In the opinion of management, all adjustments necessary for a fair presentation of interim Condensed Consolidated Financial Statements have been included. These adjustments are of normal recurring nature.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the interim Condensed Consolidated Financial Statements and accompanying notes. The most significant assumptions and estimates include those related to the valuation of real estate, depreciable lives, revenue recognition and the collectability of notes receivable and rents receivable. Application of these estimates and assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates.

These interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s 2025 audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2025.

Segments

We define our reportable segments based on the manner in which our chief operating decision maker makes key operating decisions, evaluates financial performance, allocates resources and manages our business. This approach aligns with our internal reporting structure and reflects the economic characteristics and nature of our operations. Accordingly, we have identified three reportable operating segments: REIT Portfolio, Investment Management and Structured Financing. Refer to Note 12.

Recent Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), which requires disaggregated disclosure of income statement expenses for public business entities (PBEs). Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. This guidance applies to all PBEs and is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company has elected not to early adopt and the requirements will be applied prospectively with the option for retrospective application. Adoption of this standard is not expected to have a significant impact on the Company’s Condensed Consolidated Financial Statements.

In November 2025, the FASB issued ASU 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting Improvements” (“ASU 2025-09”) that more closely aligns hedge accounting with the economics of an entity’s risk management activities. ASU 2025-09 is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. Although the Company previously considered early adoption in 2026, it has elected not to early adopt the standard because the amendments are not expected to have a meaningful impact on the Company’s current hedging activities. The Company will continue to monitor its hedging activities and plans to adopt the standard when required. Adoption of this standard is not expected to have a significant impact on the Company’s Condensed Consolidated Financial Statements.

Any other recently issued accounting standards or pronouncements not disclosed above have been excluded as they are not relevant to the Company, or they are not expected to have a material impact on the Condensed Consolidated Financial Statements.

2. Real Estate

The Company’s consolidated real estate is comprised of the following for the periods presented (in thousands):

Acquisitions

During thenine months ended September 30, 2026, the Company acquired the following consolidated REIT Portfolio retail properties (dollars in thousands):

(a)

Cumulative purchase price includes capitalized transaction costs of $5.7 million.

(b)

Development land parcel acquired as part of the overall Henderson Avenue development project in Dallas, TX for $3.2 million, inclusive of transaction costs.

(c)

In connection with an acquisition in the third quarter, the Company recorded, as part of the purchase price allocation, a $5.3 million liability for certain pre-acquisition leasing matters affecting a portion of the property. This estimate is based on currently available information and is subject to change. The Company does not currently expect amounts in excess of this liability to be material.

For acquisitions completed during the period, the Company recorded identifiable intangible assets and intangible liabilities in the aggregate of approximately $31.9 million and $20.6 million, respectively. These intangibles are amortized over the remaining lease terms of the related leases, which ranged from approximately 1 to 50 years as of the respective acquisition dates. Refer to Note 6 for additional detail on the Company’s amortization of intangible assets and liabilities.

The Company determines the fair value of the individual components of real estate asset acquisitions primarily through calculating the “as-if vacant” value of a building, using an income approach, which relies significantly upon internally determined assumptions. The Company has determined that these estimates primarily rely on Level 3 inputs, which are unobservable inputs based on our own assumptions. The most significant assumptions used in calculating the “as-if vacant” value for acquisition activity during 2026 are as follows:

Dispositions

During the three and nine months ended September 30, 2026, the Company recognized gains on disposition and deconsolidation of properties of $0.8 million and $146.9 million, respectively.

The gain recognized during the nine months ended September 30, 2026 was primarily attributable to the February 2026 recapitalization of a seven-property open-air retail portfolio into two newly formed unconsolidated joint ventures. In connection with the transaction, the Company retained a 20% ownership interest in the joint ventures, which was measured at fair value upon deconsolidation and had an aggregate fair value of $87.1 million. The transaction resulted in the recognition of a gain on disposition and deconsolidation of $112.3 million at the transaction level, of which the Company's proportionate share was $22.1 million. In addition, the Company repaid $210.5 million of consolidated Investment Management property mortgage loans using proceeds from the transaction (Note 7).

Other significant dispositions during the nine months ended September 30, 2026 included:

•

the recapitalization of the Pinewood Square property, an open-air retail center located in Lake Worth, Florida, into a newly formed unconsolidated joint venture for $68.4 million and retained a 20% ownership interest, which was fair-valued at $13.6 million, resulting in the recognition of a $4.1 million gain on deconsolidation (Note 4);

•

the disposition of Landstown Commons for $102.0 million, 1964 Union Street for $2.6 million, New Towne Center for $23.5 million, and the parking garage condominium unit at 1035 Third Avenue for $8.3 million, which were consolidated Investment Management properties. These dispositions resulted in aggregate gains of $30.3 million during the nine months ended September 30, 2026; and

•

the disposition of 1525 W. Belmont Avenue, a REIT Portfolio property located in Chicago, Illinois for $4.2 million which generated a gain of $0.2 million during the three months ended September 30, 2026.

Properties Held for Sale

No properties were classified as held for sale as of September 30, 2026 and December 31, 2025.

Real Estate Under Development

Real estate under development represents the Company’s consolidated properties that have not yet been placed into service and are undergoing substantial development or construction.

Development activity for these properties during the periods presented is summarized below (dollars in thousands):

(a)

Includes construction in progress at operating properties that remain in service during the construction period.

(b)

Transfers in for the period relate to the acquisition of development property 2310 N. Henderson Avenue (Note 2).

The number of properties in the table above refers to full-property development projects; however, certain projects represent only a portion of a property, and the capitalized costs and carrying value of these projects are included in the table above. As of September 30, 2026, consolidated REIT Portfolio development projects included 14 properties in the Henderson Avenue development project.