American Assets Trust Inc

Previous wording

Below is a summary of our same-store and redevelopment same-store composition for the three months ended March 31, 2024 and 2023. Bel-Spring 520 is classified as a same-store property when compared to the designation for the three months ended March 31, 2023, because the property was acquired on March 8, 2022. The 710 building at Lloyd Portfolio is classified as same-store property when compared to the designation for the three months ended March 31, 2023, because the property has been in operation for a full year since it was placed in service in November of 2022. One Beach Street continues to be identified as a same-store redevelopment property due to significant redevelopment activity.

Current wording

Below is a summary of our same-store and redevelopment same-store composition for the three and six months ended June 30, 2024 and 2023. Bel-Spring 520 is classified as a same-store property when compared to the designation for the three and six months ended June 30, 2023, because the property was acquired on March 8, 2022. The 710 building at Lloyd Portfolio is classified as same-store property when compared to the designation for the three and six months ended June 30, 2023, because the property has been in operation for a full year since it was placed in service in November of 2022. One Beach Street continues to be identified as a same-store redevelopment property due to significant redevelopment activity.

Previous wording

Retail same-store net operating income decreased approximately 1.1% for the three months ended March 31, 2024 compared to the same period in 2023. Office same-store net operating income increased 1.6% for the three months ended March 31, 2024 compared to the same period in 2023.

Current wording

Retail same-store net operating income increased approximately 0.3% for the six months ended June 30, 2024 compared to the same period in 2023. Office same-store net operating income decreased 0.3% for the six months ended June 30, 2024 compared to the same period in 2023.

Previous wording

We intend to opportunistically pursue projects in our development pipeline, including future phases of La Jolla Commons and Lloyd Portfolio, as well as other redevelopments at Waikele Center and One Beach Street. The commencement of these developments is based on, among other things, market conditions and our evaluation of whether such opportunities would generate appropriate risk-adjusted financial returns. Our redevelopment and development opportunities are subject to various factors, including market conditions and may not ultimately come to fruition.

Current wording

We intend to opportunistically pursue projects in our development pipeline, including future phases of La Jolla Commons, Lloyd Portfolio and development of multifamily units at Lomas Santa Fe Plaza, as well as other redevelopments at Waikele Center and One Beach Street. The commencement of these developments is based on, among other things, market conditions and our evaluation of whether such opportunities would generate appropriate risk-adjusted financial returns. Our redevelopment and development opportunities are subject to various factors, including market conditions and may not ultimately come to fruition.

Previous wording

During the three months ended March 31, 2024, we signed 18 office leases for a total of 124,605 square feet of office space including 80,434 square feet of comparable renewal office space leases (leases for which there was a prior tenant), at an average rental rate increase on a cash basis and increase on a GAAP basis of 7.9% and 10.9%, respectively. New office leases for comparable spaces were signed for 22,658 square feet at an average rental rate increase on a cash and GAAP basis of 13.8% and 19.4%, respectively. Renewals for comparable office spaces were signed for 57,776 square feet at an average rental rate increase on a cash basis and increase on a GAAP basis of 6.0% and 8.3%, respectively. Tenant improvements and incentives were $38.22 per square foot of office space for comparable new leases for the three months ended March 31, 2024, mainly due to new tenants at Lloyd District and Torrey Reserve.

Current wording

During the three months ended June 30, 2024, we signed 18 office leases for a total of 96,042 square feet of office space including 52,618 square feet of comparable renewal office space leases (leases for which there was a prior tenant), at an average rental rate increase on a cash basis and increase on a GAAP basis of 5.2% and 14.5%, respectively. New office leases for comparable spaces were signed for 20,978 square feet at an average rental rate increase on a cash and GAAP basis of 4.1% and 26.4%, respectively. Renewals for comparable office spaces were signed for 31,640 square feet at an average rental rate increase on a cash basis and increase on a GAAP basis of 5.7% and 9.7%, respectively. Tenant improvements and incentives were $34.71 per square foot of office space for comparable new leases for the three months ended June 30, 2024, mainly due to a new tenant at First & Main.

Previous wording

During the three months ended March 31, 2024, we signed 30 retail leases for a total of 109,414 square feet of retail space including 103,311 square feet of comparable renewal retail space leases (leases for which there was a prior tenant), at an average rental rate increase on a cash and GAAP basis of 1.9% and 22.3%, respectively. New retail leases for comparable spaces were signed for 4,783 square feet at an average rental rate increase on a cash and GAAP basis of 36.4% and 0%, respectively. Renewals for comparable retail spaces were signed for 98,528 square feet at an average rental rate increase on a cash and GAAP basis of 0.7% and 15.7%, respectively. Tenant improvements and incentives were $41.14 per square foot of retail space for comparable new leases for the three months ended March 31, 2024, mainly due to new tenants at Del Monte Center and Solana Beach Towne Centre.

Current wording

During the three months ended June 30, 2024, we signed 19 retail leases for a total of 68,735 square feet of retail space including 64,127 square feet of comparable renewal retail space leases (leases for which there was a prior tenant), at an average rental rate increase on a cash and GAAP basis of 5.8% and 34.4%, respectively. New retail leases for comparable spaces were signed for 1,064 square feet at an average rental rate increase on a cash and GAAP basis of 22.7% and 0%, respectively. Renewals for comparable retail spaces were signed for 63,063 square feet at an average rental rate increase on a cash and GAAP basis of 4.7% and 17.9%, respectively. Tenant improvements and incentives were $18.80 per square foot of retail space for comparable new leases for the three months ended June 30, 2024, mainly due to a new tenant at Waikiki Beach Walk Retail.

Previous wording

We capitalized external and internal costs related to both development and redevelopment activities combined of $3.5 million and $9.6 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

We capitalized external and internal costs related to both development and redevelopment activities combined of $4.8 million and $5.6 million for the three months ended June 30, 2024 and 2023, respectively, and $8.3 million and $15.3 million for the six months ended June 30, 2024 and 2023, respectively.

Previous wording

We capitalized external and internal costs related to other property improvements combined of $9.6 million and $12.4 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

We capitalized external and internal costs related to other property improvements combined of $14.6 million and $13.2 million for the three months ended June 30, 2024 and 2023, respectively, and $24.1 million and $25.5 million for the six months ended June 30, 2024 and 2023, respectively

Previous wording

Interest costs on developments and major redevelopments are capitalized as part of developments and redevelopments not yet placed in service. Capitalization of interest commences when development activities and expenditures begin and end upon completion, which is when the asset is ready for its intended use as noted above. We make judgments as to the time period over which to capitalize such costs and these assumptions have a direct impact on net income because capitalized costs are not subtracted in calculating net income. If the time period for capitalizing interest is extended, however, more interest is capitalized, thereby decreasing interest expense and increasing net income during that period. We capitalized interest costs related to development activities of $2.1 million and $1.8 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

Interest costs on developments and major redevelopments are capitalized as part of developments and redevelopments not yet placed in service. Capitalization of interest commences when development activities and expenditures begin and end upon completion, which is when the asset is ready for its intended use as noted above. We make judgments as to the time period over which to capitalize such costs and these assumptions have a direct impact on net income because capitalized costs are not subtracted in calculating net income. If the time period for capitalizing interest is extended, however, more interest is capitalized, thereby decreasing interest expense and increasing net income during that period. We capitalized interest costs related to development activities of $2.1 million and $1.9 million for the three months ended June 30, 2024 and 2023, respectively, and $4.2 million and $3.8 million for the six months ended June 30, 2024 and 2023, respectively.

Previous wording

Total property revenues. Total property revenue consists of rental revenue and other property income. Total property revenue increased $2.9 million to $110.7 million for the three months ended March 31, 2024 compared to $107.8 million for the three months ended March 31, 2023. The percentage leased was as follows for each segment as of March 31, 2024 and 2023:

Current wording

Total property revenues. Total property revenue consists of rental revenue and other property income. Total property revenue increased $1.2 million to $110.9 million for the three months ended June 30, 2024 compared to $109.7 million for the three months ended June 30, 2023. The percentage leased was as follows for each segment as of June 30, 2024 and 2023:

Previous wording

The increase in total property revenue was attributable primarily to new retail leases, higher average monthly base rents within the multifamily segment and an increase in occupancy and rate at Waikiki Beach Walk Embassy Suites™ and factors discussed below.

Current wording

The increase in total property revenue was attributable primarily to higher average monthly base rents within the multifamily segment, new tenant leases commenced within the retail segment and an increase in occupancy and rate at Waikiki Beach Walk Embassy Suites™ and factors discussed below.

Previous wording

Rental revenues. Rental revenue includes minimum base rent, cost reimbursements, percentage rents and other rents. Rental revenue increased $2.3 million, or 2%, to $105.0 million for the three months ended March 31, 2024 and March 31, 2023. Rental revenue by segment was as follows (dollars in thousands):

Current wording

Rental revenues. Rental revenue includes minimum base rent, cost reimbursements, percentage rents and other rents. Rental revenue increased $1.2 million, or 1%, to $105.1 million for the three months ended June 30, 2024 and June 30, 2023. Rental revenue by segment was as follows (dollars in thousands):

Previous wording

Total retail rental revenue increased $0.5 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to new tenant leases and scheduled rent increases. These increases were primarily related to Carmel Mountain Plaza, Waikele Center and Del Monte Center.

Current wording

Total retail rental revenue increased $0.8 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 primarily due to new tenant leases and scheduled rent increases at Solana Beach Towne Center, Waikele Center and Del Monte Center. Additionally, there was an increase of $0.4 million in cost recoveries.

Previous wording

Office other property income increased by $0.4 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to lease settlement fees received at Torrey Reserve.

Current wording

Office other property income increased by $0.1 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 primarily due to lease settlement fees received at Torrey Reserve Campus.

Previous wording

Total Property Expenses. Total property expenses consist of rental expenses and real estate taxes. Total property expenses increased $1.9 million, or 5%, to $41.1 million, for the three months ended March 31, 2024 compared to $39.1 million for the three months ended March 31, 2023.

Current wording

Total Property Expenses. Total property expenses consist of rental expenses and real estate taxes. Total property expenses increased $0.6 million, or 1%, to $40.3 million, for the three months ended June 30, 2024 compared to $39.8 million for the three months ended June 30, 2023.

Previous wording

Rental Expenses. Rental expenses increased $2.3 million, or 8%, to $29.8 million for the three months ended March 31, 2024 compared to $27.5 million for the three months ended March 31, 2023. Rental expense by segment was as follows (dollars in thousands):

Current wording

Rental Expenses. Rental expenses increased $0.8 million, or 3%, to $29.5 million for the three months ended June 30, 2024 compared to $28.7 million for the three months ended June 30, 2023. Rental expense by segment was as follows (dollars in thousands):

Previous wording

Office rental expense increased $0.6 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to an increase in utilities expenses, janitorial expenses, security services and insurance expense.

Current wording

Office rental expense increased $0.2 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 primarily due to an increase in janitorial expenses, security services and repairs and maintenance expense.

Previous wording

Multifamily rental expense increased $0.4 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to an increase in insurance expense and employee related costs.

Current wording

Multifamily rental expense increased $0.1 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 primarily due to an increase in insurance expense and facilities services.

Previous wording

Mixed-use rental expense increased $0.6 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to an increase in hotel room expenses and employee related costs at the hotel portion of our mixed-use property.

Current wording

Mixed-use rental expense increased $0.1 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 primarily due to an increase in repairs and maintenance expense and employee related costs at the retail portion of our mixed-use property.

Previous wording

Real Estate Taxes. Real estate taxes decreased $0.4 million, or 3%, to $11.2 million for the three months ended March 31, 2024 compared to $11.6 million for the three months ended March 31, 2023. Real estate tax expense by segment was as follows (dollars in thousands):

Current wording

Real Estate Taxes. Real estate taxes decreased $0.2 million, or 2%, to $10.8 million for the three months ended June 30, 2024 compared to $11.1 million for the three months ended June 30, 2023. Real estate tax expense by segment was as follows (dollars in thousands):

Previous wording

Property operating income increased $1.0 million, or 1%, to $69.6 million for the three months ended March 31, 2024, compared to $68.6 million for the three months ended March 31, 2023. Property operating income by segment was as follows (dollars in thousands):

Current wording

Property operating income increased $0.6 million, or 1%, to $70.5 million for the three months ended June 30, 2024, compared to $69.9 million for the three months ended June 30, 2023. Property operating income by segment was as follows (dollars in thousands):

Previous wording

Total multifamily property operating income increased $0.3 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to higher rental revenue due to an overall increase in average monthly base rent to $2,681 for the three months ended March 31, 2024 compared to $2,514 for the three months ended March 31, 2023. These increases were offset by higher rental expenses related to insurance expense and employee-related costs.

Current wording

Total multifamily property operating income increased $1.2 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 primarily due to an overall increase in average monthly base rent and an increase in occupancy. Average monthly base rent and occupancy was $2,730 and 90.8%, respectively, for the three months ended June 30, 2024 compared to $2,587 and 87.7%, respectively, for the three months ended June 30, 2023.

Previous wording

Total mixed-use property operating income increased $0.4 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to increase in tourism, which led to an increase in average occupancy and revenue per available room to 89.8% and $320, respectively, for the three months ended March 31, 2024, compared to 81.9% and $302, respectively, for the three months ended March 31, 2023. This also led to an increase in other room rental income at the hotel portion of our mixed-use property. These increases were offset by higher hotel room expenses and employee related costs at the hotel portion of our mixed-use property.

Current wording

Total mixed-use property operating income increased $0.1 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 primarily due to increase in tourism, which led to an increase in average occupancy and revenue per available room to 86.4% and $317, respectively, for the three months ended June 30, 2024, compared to 84.4% and $312, respectively, for the three months ended June 30, 2023. There was also an increase in parking income at the retail portion of our mixed-use property. These increases were offset by higher real estate taxes due to an increase in property tax assessment.

Previous wording

General and Administrative. General and administrative expenses decreased $0.2 million, or 2%, for the three months ended March 31, 2024, compared to the three months ended March 31, 2023. This decrease was primarily due to lower general legal expense and stock-based compensation expense, attributable to a decrease in the number of restricted stock awards granted as part of our 2023 grant. These decreases were offset by higher employee-related costs, including, without limitation, with respect to base pay for certain salaried and hourly workers and benefits.

Current wording

General and Administrative. General and administrative expenses increased $0.1 million, or 1%, for the three months ended June 30, 2024, compared to the three months ended June 30, 2023. This increase was primarily due to higher employee-related costs, including, without limitation, with respect to base pay for certain salaried and hourly workers and benefits, offset by lower stock-based compensation expense, attributable to a decrease in the number of restricted stock awards granted as part of our 2023 grant.

Previous wording

Depreciation and Amortization. Depreciation and amortization expense increased $0.3 million, or 1%, for the three months ended March 31, 2024, compared to the three months ended March 31, 2023. This was due to new building improvements and furniture and equipment assets placed into service in 2023.

Current wording

Depreciation and Amortization. Depreciation and amortization expense increased $1.2 million, or 4%, for the three months ended June 30, 2024, compared to the three months ended June 30, 2023. This was due to new building improvements and tenant improvement assets placed into service and acceleration of assets related to a tenant vacating their space early at Torrey Reserve Campus.

Previous wording

Interest Expense, net. Interest expense increased $0.5 million, or 3%, for the three months ended March 31, 2024, compared to the three months ended March 31, 2023. This increase was primarily due to higher interest on our $225 million Amended and Restated Term Loan Agreement and related amortization of loan fees. These increases were offset by an increase in capitalized interest related to our development projects.

Current wording

Interest Expense, net. Interest expense decreased $0.1 million, or less than 1%, for the three months ended June 30, 2024, compared to the three months ended June 30, 2023. This decrease was primarily due to an increase in capitalized interest related to our development projects offset by higher interest on our $225 million Amended and Restated Term Loan Agreement.

Previous wording

Other property income. Other property income increased $0.6 million, or 12%, to $5.7 million for the three months ended March 31, 2024 compared to $5.0 million for the three months ended March 31, 2023. Other property income by segment was as follows (dollars in thousands):

Current wording

Other property income. Other property income increased $0.6 million, or 6%, to $11.5 million for the six months ended June 30, 2024 compared to $10.9 million for the six months ended June 30, 2023. Other property income by segment was as follows (dollars in thousands):

Previous wording

Retail other property income decreased by $0.1 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to lease settlement fees received at Solana Beach Towne Center and Hassalo on Eighth - Retail in 2023.

Current wording

Retail other property income decreased $0.3 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to lease termination fees received at Carmel Mountain Plaza and Solana Beach Towne Center in 2023.

Previous wording

Mixed-use other property income increased by $0.3 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to increased tourism and hotel occupancy which led to an increase in other room rental income at the hotel portion of our mixed-use property and an increase in parking garage income at the retail portion of our mixed-use property.

Current wording

Total mixed-use other property income increased $0.4 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to increased tourism and hotel occupancy which led to an increase in other room rental income at the hotel portion of our mixed-use property and increase in parking income at the retail portion of our mixed-use property.

Previous wording

Retail rental expense increased $0.7 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to $0.5 million written off in the first quarter for non-recurring costs incurred in prior periods relating to construction in progress for then-prospective construction at Waikele Center. Additionally, there was an increase in insurance expense and employee related costs.

Current wording

Retail rental expenses increased $1.0 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to $0.5 million written off in the first quarter for non-recurring costs incurred in prior periods relating to construction in progress for then-prospective construction at Waikele Center. Additionally, there was an increase in security services, insurance expense and facilities services.

Previous wording

Office real estate taxes decreased $0.4 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to a one-time real estate tax refund received at First & Main and a decrease in property tax assessments at City Center Bellevue.

Current wording

Retail real estate taxes decreased $0.1 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to a real estate tax refund received at Del Monte Center.

Previous wording

Total office property operating income increased $0.5 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023, primarily due to higher annualized base rents at Torrey Reserve, Solana Crossing, Torrey Point and La Jolla Commons. Additionally, there was an increase in other property income related to lease settlement fees received at Torrey Reserve and lower real estate taxes at City Center Bellevue and First & Main. These increases were offset by higher rental expenses related to utilities expense, janitorial expense, security services and insurance expense.

Current wording

Total office property operating income decreased $0.4 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily due to higher operating expenses related to utilities expenses, repairs and facilities services and insurance expense. Additionally, there was a decrease due to lower cost recoveries. These decreases were partially offset by higher annualized base rents at Torrey Reserve Campus, La Jolla Commons and Solana Crossing, lease settlement fees received at Torrey Reserve Campus and lower real estate taxes due to refunds received at La Jolla Commons and First & Main.

Previous wording

Total retail property operating income decreased $0.2 million for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 primarily due to increased rental expenses attributable to higher insurance expense, and employee-related costs, and $0.5 million written off in the first quarter for non-recurring costs incurred in prior periods relating to construction in progress for then-prospective construction at Waikele Center. These decreases were offset by higher rental revenue at Carmel Mountain Plaza, Waikele Center and Del Monte Center due to new tenant leases and scheduled rent increases.

Current wording

Total retail property operating income increased $0.1 million during the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to new tenant leases signed, scheduled rent increases and tenants previously on alternate rent reverting back to basic monthly rent and an increase in cost recoveries. These increases were partially offset by higher facilities services and insurance expense, and $0.5 million written off in the first quarter of 2024 for non-recurring costs incurred in prior periods relating to construction in progress for then-prospective construction at Waikele Center.

Previous wording

Other Income (Expense), Net. Other income, net increased $3.7 million, or 55%, for the three months ended March 31, 2024, compared to the three months ended March 31, 2023. This increase was primarily due to the net settlement payment of approximately $10 million received during the first quarter of 2024 relating to building specifications for one of the existing buildings at our office project in University Town Center (San Diego), compared to the net settlement payment of approximately $6.3 million received on January 3, 2023 related to certain building systems at our Hassalo on Eighth property.

Current wording

Other Income, net. Other income, net increased $4.2 million, or 60%, for the six months ended June 30, 2024, compared to the six months ended June 30, 2023. This increase was primarily due to the net settlement payment of approximately $10.0 million received during the first quarter of 2024 relating to building specifications for one of the existing buildings at our office project in University Town Center (San Diego), compared to the net settlement payment of approximately $6.3 million received on January 3, 2023 related to certain building systems at our Hassalo on Eighth property and an increase of $0.6 million in interest and investment income attributed to higher yield on our average cash balance during the period.

Previous wording

Due to the nature of our business, we typically generate significant amounts of cash from operations. The cash generated from operations is used for the payment of operating expenses, capital expenditures, debt service and dividends to American Assets Trust, Inc.'s stockholders and our unitholders. As a REIT, American Assets Trust, Inc. must generally make annual distributions to its stockholders of at least 90% of its net taxable income. As of March 31, 2024, we held $98.6 million in cash and cash equivalents.

Current wording

Due to the nature of our business, we typically generate significant amounts of cash from operations. The cash generated from operations is used for the payment of operating expenses, capital expenditures, debt service and dividends to American Assets Trust, Inc.'s stockholders and our unitholders. As a REIT, American Assets Trust, Inc. must generally make annual distributions to its stockholders of at least 90% of its net taxable income. As of June 30, 2024, we held $114.9 million in cash and cash equivalents.

Previous wording

Our overall capital requirements for the remainder of 2024 and for the three months ending March 31, 2025 will depend upon acquisition opportunities and the level of improvements and redevelopments on existing properties. Our capital investments will be funded on a short-term basis with, among other sources of capital, cash on hand, cash flow from operations and/or our revolving line of credit. On a long-term basis, our capital investments may be funded with additional long-term debt, including, without limitation, mortgage debt and unsecured notes. Our ability to incur additional debt will be dependent on a number of factors, including, without limitation, our degree of leverage, the value of our unencumbered assets and borrowing restrictions that may be imposed by lenders. Our capital investments may also be funded by issuing additional equity including, without limitation, shares issued by American Assets Trust, Inc. under its ATM equity program or through an underwritten public offering. Although there is no intent at this time, if market conditions deteriorate or fail to improve, we may also delay the timing of future development and redevelopment projects as well as limit future acquisitions, reduce our operating expenditures, or re-evaluate our dividend policy.

Current wording

Our overall capital requirements for the remainder of 2024 and for the first half of 2025 will depend upon acquisition opportunities and the level of improvements and redevelopments on existing properties. Our capital investments will be funded on a short-term basis with, among other sources of capital, cash on hand, cash flow from operations and/or our revolving line of credit. On a long-term basis, our capital investments may be funded with additional long-term debt, including, without limitation, mortgage debt and unsecured notes. Our ability to incur additional debt will be dependent on a number of factors, including, without limitation, our degree of leverage, the value of our unencumbered assets and borrowing restrictions that may be imposed by lenders. Our capital investments may also be funded by issuing additional equity including, without limitation, shares issued by American Assets Trust, Inc. under its ATM equity program or through an underwritten public offering. Although there is no intent at this time, if market conditions deteriorate or fail to improve, we may also delay the timing of future development and redevelopment projects as well as limit future acquisitions, reduce our operating expenditures, or re-evaluate our dividend policy.

Previous wording

Cash, cash equivalents, and restricted cash were $98.6 million and $87.3 million at March 31, 2024 and 2023, respectively.

Current wording

Cash, cash equivalents, and restricted cash were $114.9 million and $84.7 million at June 30, 2024 and 2023, respectively.

Previous wording

Net cash provided by operating activities increased $2.8 million to $54.8 million for the three months ended March 31, 2024 compared to $52.0 million for the three months ended March 31, 2023. The increase in cash from operations was primarily due to the net settlement received relating to building specifications for one of the existing buildings at our office project in University Town Center (San Diego), increase in rental revenue and changes in operating assets and liabilities.

Current wording

Net cash provided by operating activities increased $15.9 million to $114.1 million for the six months ended June 30, 2024 compared to $98.1 million for the six months ended June 30, 2023. The increase in cash from operations was primarily due to the net settlement received relating to building specifications for one of the existing buildings at our office project in University Town Center (San Diego), lease termination fees received which will be recognized in the third quarter of 2024, increase in rental revenue and changes in operating assets and liabilities.

Previous wording

Net cash used in investing activities decreased $12.4 million to $13.3 million for the three months ended March 31, 2024 compared to $25.7 million for the three months ended March 31, 2023. The decrease in cash used was primarily due to the decrease in capital expenditures at La Jolla Commons III and One Beach Street as these projects have completed construction.

Current wording

Net cash used in investing activities decreased $18.7 million to $30.4 million for the six months ended June 30, 2024 compared to $49.1 million for the six months ended June 30, 2023. The decrease in cash used was primarily due to the decrease in capital expenditures at La Jolla Commons III and One Beach Street as these projects have completed construction.

Previous wording

Net cash used by financing activities increased $37.3 million to $25.8 million for the three months ended March 31, 2024 compared to cash provided by financing activities of $11.5 million for the three months ended March 31, 2023. The increase in cash used in financing activities was primarily due to the term loan agreement that was amended and restated in 2023, among other things, to increase the fully drawn borrowings from $150 million to $225 million. This was partially offset by the repayment of the outstanding balance on the revolving line of credit.

Current wording

Net cash used in financing activities increased $37.7 million to $51.6 million for the six months ended June 30, 2024 compared to cash used in financing activities of $13.9 million for the six months ended June 30, 2023. The increase in cash used in financing activities was primarily due to the term loan agreement that was amended and restated in 2023, among other things, to increase the fully drawn borrowings from $150 million to $225 million. This was partially offset by the repayment of the outstanding balance on the revolving line of credit.

Previous wording

Analysis of Financial Condition and Results of Operations” regarding the components of net income that are eliminated in the calculation of NOI. Other companies may use different methods for calculating NOI or similarly entitled measures and, accordingly, our NOI may not be comparable to similarly entitled measures reported by other companies that do not define the measure exactly as we do.

Current wording

NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income computed in accordance with GAAP and discussions elsewhere in “Management's Discussion and Analysis of Financial Condition and Results of Operations” regarding the components of net income that are eliminated in the calculation of NOI. Other companies may use different methods for calculating NOI or similarly entitled measures and, accordingly, our NOI may not be comparable to similarly entitled measures reported by other companies that do not define the measure exactly as we do.