KITE REALTY GROUP TRUST (KRG)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the accompanying historical financial statements and related notes thereto. In this discussion, unless the context suggests otherwise, references to “our Company,” “we,” “us,” and “our” mean Kite Realty Group Trust and its direct and indirect subsidiaries, including Kite Realty Group, L.P.

CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, together with other statements and information publicly disseminated by us, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on assumptions and expectations that may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, performance, transactions or achievements, financial or otherwise, may differ materially from the results, performance, transactions or achievements, financial or otherwise, expressed or implied by the forward-looking statements.

Risks, uncertainties and other factors that might cause such differences, some of which could be material, include but are not limited to:

•economic, business, banking, real estate and other market conditions, particularly in connection with low or negative growth in the U.S. economy as well as economic uncertainty (including from an economic slowdown or recession, federal government shutdown, disruptions related to tariffs and other trade or sanction issues, geopolitical instability, rising interest rates, inflation, unemployment, or limited growth in consumer income or spending);

•financing risks, including the availability of, and costs associated with, sources of liquidity, and our ability to use offering proceeds for the anticipated purposes;

•our ability to refinance, or extend the maturity dates of, our indebtedness;

•the level and volatility of interest rates;

•the financial stability of our tenants;

•the competitive environment in which we operate, including potential oversupplies of, or a reduction in demand for, rental space;

•acquisition, disposition, development and joint venture risks, including the ability to complete them on the terms and timing anticipated;

•property ownership and management risks, including the relative illiquidity of real estate investments, and expenses, vacancies or the inability to rent space on favorable terms or at all;

•our ability to maintain our status as a real estate investment trust (“REIT”) for U.S. federal income tax purposes;

•potential environmental and other liabilities;

•impairment in the value of real estate property we own;

•the attractiveness of our properties to tenants;

•the actual and perceived impact of e-commerce on the value of shopping center assets and changing demographics and customer traffic patterns;

•business continuity disruptions and a deterioration in our tenants’ ability to operate in affected areas or delays in the supply of products or services to us or our tenants from vendors that are needed to operate efficiently;

•risks related to our current geographical concentration of properties in the states of Texas, Florida, and North Carolina and the metropolitan statistical areas (“MSAs”) of New York, Atlanta, Seattle, Chicago, and Washington, D.C.;

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•civil unrest, acts of violence, terrorism or war, acts of God, climate change, epidemics, pandemics, natural disasters and severe weather conditions, including such events that may result in underinsured or uninsured losses or other increased costs and expenses;

•changes in laws and government regulations, including governmental orders affecting the use of our properties or the ability of our tenants to operate, and the costs of complying with such changed laws and government regulations;

•possible changes in consumer behavior due to public health crises and the fear of future pandemics;

•our ability to satisfy environmental, social or governance standards set by various constituencies;

•insurance costs and coverage, especially in Florida and Texas coastal areas and North Carolina;

•risks associated with cyberattacks and the loss of confidential information and other business disruptions;

•risks associated with the use of artificial intelligence and related tools;

•other factors affecting the real estate industry generally; and

•other risks identified in this Quarterly Report on Form 10-Q and, from time to time, in other reports we file with the Securities and Exchange Commission (the “SEC”) or in other documents that we publicly disseminate, including, in particular, the section titled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

We undertake no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.

Overview

Our Business and Properties

Kite Realty Group Trust is a publicly held REIT that, through its majority-owned subsidiary, Kite Realty Group, L.P., owns interests in various operating subsidiaries and joint ventures engaged in the ownership, operation, acquisition, development, and redevelopment of high-quality, open-air, grocery-anchored shopping centers and vibrant mixed-use assets that are primarily located in high-growth Sun Belt markets and select strategic gateway markets in the United States. We derive our revenue primarily from the collection of contractual rents and reimbursement payments from tenants under existing lease agreements at each of our properties. Therefore, our operating results depend materially on, among other things, the ability of our tenants to make required lease payments, the health and resilience of the U.S. retail sector, particularly in light of increased tariffs that were enacted in 2025, interest rate volatility, job growth, the real estate market, and overall economic conditions.

As of June 30, 2026, we own interests in a portfolio of 163 operating retail/mixed-use properties, including 155 wholly owned shopping centers and eight properties owned through four unconsolidated joint ventures, totaling approximately 26.0 million square feet, excluding (i) Eastgate Crossing, a 152,682 square foot multi-tenant retail property in the Durham-Chapel Hill MSA that was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal, and (ii) two standalone office properties with 0.4 million square feet. Of the 163 operating retail/mixed-use properties, 11 contain an office component. We also own interests in one development project under construction as of June 30, 2026 and an additional two properties with future redevelopment opportunities.

Inflation and Tariffs

We continue to monitor the impact of inflation and tariffs on our operating and financial performance. Although inflation has moderated significantly from peak levels experienced during 2022, inflation may increase in the future as a result of multiple factors, including the tariffs implemented by the U.S. government in 2025 on imported goods from specific countries and inflationary pressures arising from geopolitical instability. These tariffs may lead to higher prices for many of the products that our tenants sell, potentially reducing consumer demand and spending and negatively impacting our tenants’ sales volume and overall health. This, in turn, has and could in the future put downward pricing pressure on rents that we are able to charge to new or renewing tenants, such that rent spreads and, in some cases, our percentage rents could be adversely impacted. Additionally, uncertainty regarding the scope and duration of the current and potential tariffs can lead to significant business uncertainty, affecting our tenants’ strategic planning and store expansion plans. Many of our leases contain provisions designed to mitigate the adverse impact of inflation, including stated rent increases and requirements for tenants to pay a share of

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operating expenses, including common area maintenance, real estate taxes, insurance, or other operating expenses related to the maintenance of our properties, with escalation clauses in most leases. Over the past few years, we have made significant progress in executing leases that include higher fixed-rent increases while also including consumer price index-based, anti-gouging protection for tenants. However, the stated rent increases or limits on such tenant’s obligation to pay its share of operating expenses could be lower than the increase in inflation at any given time. Inflation may also increase labor or other general and administrative expenses, which cannot be easily reduced.

Historically, economic indicators such as GDP growth, consumer confidence, and employment have been correlated with demand for certain of our tenants’ products and services. An economic recession could, among other impacts, increase the number of our tenants that are unable to meet their lease obligations to us and limit the demand from new tenants for space in our properties.

Operating Activity

During the second quarter of 2026, we executed new and renewal leases on 128 individual spaces totaling approximately 1.0 million square feet (15.9% cash leasing spread on 103 comparable leases). New leases were signed on 44 individual spaces for 329,750 square feet of gross leasable area (“GLA”) (28.4% cash leasing spread on 29 comparable leases), while non-option renewal leases were signed on 47 individual spaces for 188,717 square feet of GLA (17.7% cash leasing spread on 37 comparable leases) and option renewals were signed on 37 individual spaces for 476,194 square feet of GLA (6.6% cash leasing spread). The blended cash spread for comparable new and non-option renewal leases was 24.7%. Comparable new and renewal leases are defined as those for which the space was occupied by a tenant within the last 12 months. As of June 30, 2026, the Company’s operating retail portfolio annualized base rent per square foot was $23.41.

New Tax Legislation

Effective July 4, 2025, certain changes to U.S. tax law were approved that impact us and our shareholders. Among other changes, this legislation (i) permanently extends the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers under Section 199A of the Internal Revenue Code (the “Code”), (ii) increases the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries from 20% to 25% for taxable years beginning after December 31, 2025, and (iii) increases the base on which the 30% interest deduction limit under Section 163(j) of the Code applies by excluding depreciation, amortization, and depletion from the definition of “adjusted taxable income” (i.e., based on EBITDA rather than EBIT) for taxable years beginning after December 31, 2024.

Results of Operations

Our development, redevelopment, and operating property acquisition and disposition activities during 2025 and 2026 affect the comparability of our results of operations for the three and six months ended June 30, 2026 and 2025. Therefore, we believe it is most useful to review the comparisons of our results of operations for these periods (as set forth below under “Comparison of Operating Results for the Three Months Ended June 30, 2026 to the Three Months Ended June 30, 2025” and “Comparison of Operating Results for the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025”) in conjunction with the discussion of our transaction activities during those periods, which is set forth below.

Acquisitions

The following operating properties were acquired during the pe

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the accompanying audited consolidated financial statements and related notes thereto and Item 1A, “Risk Factors,” appearing elsewhere in this Annual Report on Form 10-K. In this discussion, unless the context suggests otherwise, the terms “the Company,” “we,” “us,” and “our” refer to Kite Realty Group Trust and its direct and indirect subsidiaries, including Kite Realty Group, L.P.

Overview

In the following overview, we discuss, among other things, the status of our business and properties, the effect that current U.S. economic conditions are having on our retail tenants and us, and the current state of the financial markets and how it impacts our financing strategy.

Our Business and Properties

Kite Realty Group Trust is a publicly held REIT that, through its majority-owned subsidiary, Kite Realty Group, L.P., owns interests in various operating subsidiaries and joint ventures engaged in the ownership, operation, acquisition, development, and redevelopment of high-quality, open-air, grocery-anchored shopping centers and vibrant mixed-use assets that are primarily located in high-growth Sun Belt markets and select strategic gateway markets in the United States. Following our merger with RPAI in 2021, we became a top-five open-air shopping center REIT based upon market capitalization. We derive our revenue primarily from the collection of contractual rents and reimbursement payments from tenants under existing lease agreements at each of our properties. Therefore, our operating results depend materially on, among other things, the ability of our tenants to make required lease payments, the health and resilience of the U.S. retail sector, particularly in light of increased tariffs in 2025, interest rate volatility, job growth, the real estate market, and overall economic conditions.

As of December 31, 2025, we own interests in a portfolio of 167 operating retail/mixed-use properties, including 159 wholly owned properties and eight properties owned through four unconsolidated joint ventures, totaling approximately 26.9 million square feet, excluding (i) two operating retail properties classified as held for sale as of December 31, 2025, (ii) Eastgate Crossing, a 152,682 square foot multi-tenant retail property in the Durham-Chapel Hill MSA that was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal, and (iii) two standalone office properties with 0.4 million square feet. Of the 167 operating retail/mixed-use properties, 10 contain an office component. We also own interests in one development project that is under construction as of December 31, 2025 and an additional two properties with future redevelopment opportunities.

Inflation and Tariffs

We continue to monitor the impact of inflation and tariffs on our operating and financial performance. Although inflation has moderated significantly from peak levels experienced during 2022, inflation may increase in the future as a result of multiple factors, including the tariffs implemented by the U.S. government in 2025 on imported goods from specific countries. These tariffs may lead to higher prices for many of the products that our tenants sell, potentially reducing consumer demand and spending and negatively impacting our tenants’ sales volume and overall health. This, in turn, has and could in the future put downward pricing pressure on rents that we are able to charge to new or renewing tenants, such that rent spreads and, in some cases, our percentage rents could be adversely impacted. Additionally, uncertainty regarding the scope and duration of the current and potential tariffs can lead to significant business uncertainty, affecting our tenants’ strategic planning and store expansion plans. Many of our leases contain provisions designed to mitigate the adverse impact of inflation, including stated rent increases and requirements for tenants to pay a share of operating expenses, including common area maintenance, real estate taxes, insurance, or other operating expenses related to the maintenance of our properties, with escalation clauses in most leases. Over the past few years, we have made significant progress in executing leases that include higher fixed-rent increases while also including consumer price index-based, anti-gouging protection for tenants. However, the stated rent increases or limits on such tenant’s obligation to pay its share of operating expenses could be lower than the increase in inflation at any given time. Inflation may also increase labor or other general and administrative expenses, which cannot be easily reduced.

Historically, economic indicators such as GDP growth, consumer confidence, and employment have been correlated with demand for certain of our tenants’ products and services. An economic recession could, among other impacts, increase the number of our tenants that are unable to meet their lease obligations to us and limit the demand from new tenants for space in our properties.

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Table of Contents

Portfolio Update

Over the past two years, demand for open-air retail real estate has been strong due to the limited availability of desirable retail space and limited new construction over the previous 15 years. As a result, in 2024, we experienced our highest annual leasing activity in the Company’s history with approximately 5.0 million square feet of leasing volume, and in 2025, we leased approximately 4.6 million square feet at 13.8% comparable blended cash leasing spreads. Open-air centers are thriving for a variety of reasons, including their ability to function as last-mile fulfillment centers and their convenient and affordable nature for retailers and consumers. Their appeal includes conveniently located and easily accessible parking fields, lower operating expenses as compared to other retail formats, and essential anchors that drive daily trips. In addition, the Company’s property types are particularly suited for retailers’ current and evolving needs, including curbside pick-up and buying online and picking up in store (“BOPIS”), which we believe will benefit from tenant demand for additional space. The strength of the Company’s real estate is further evidenced by our continued strong cash leasing spreads and ABR for the retail portfolio of $22.63 per square foot as of December 31, 2025.

In evaluating potential acquisition, development, and redevelopment opportunities, we look for strong sub-markets where average household income, educational attainment, population density, traffic counts, and daytime workforce populations are above the broader market average. We also focus on locations that are benefiting from current population migratory patterns, namely major cities in business-friendly states with no or relatively low income taxes and mild or temperate climates. In our largest submarkets, household incomes are significantly higher and state income taxes are relatively lower than the medians for the broader markets.

In addition to targeting submarkets with strong consumer demographics, we focus on having the most desirable tenant mix at each shopping center. We have aggressively targeted and executed leases with prominent grocers, including Lidl, Aldi, Whole Foods, Trader Joe’s, Sprouts Farmers Market, and BJ’s Wholesale Club; expanding retailers such as Nordstrom Rack, Homesense, Ross Dress for Less, Burlington, Sierra, J.Crew Factory, and Boot Barn; service and restaurant retailers; and other retailers such as Ulta Beauty, Barnes & Noble, REI, Five Below, L.L.Bean, and Total Wine & More. Additionally, we have identified cost-efficient ways to relocate, re-tenant, and renegotiate leases at several of our properties, which allows us to attract more suitable tenants.

As part of our portfolio management, in 2025, we began disposing of select properties and land parcels that were no longer core components of our growth strategy and sold a total of $621.7 million of larger-format and other non-core assets. These dispositions have reduced our exposure to at-risk tenants and have elevated the overall quality of our portfolio. We are exploring opportunities to improve the portfolio by identifying and executing additional dispositions of non-core and/or larger-format assets in 2026. We expect to use the net proceeds from these dispositions towards a combination of acquisitions completed via 1031 Exchange, debt reduction, share repurchases, and/or special dividends. In order to allow for additional share repurchases, in February 2026, our Board of Trustees authorized a $300.0 million increase to the size of our Share Repurchase Program, authorizing share repurchases up to a maximum of $600.0 million of our common shares.

Capital and Financing Activities

In 2025, we maintained a conservative balance sheet and ample liquidity to fund future growth. We ended 2025 with approximately $1.0 billion of combined cash and borrowing capacity on the Revolving Facility. In addition, as of December 31, 2025, we had $410.6 million of debt principal scheduled to mature through December 31, 2026, which we expect will be satisfied through a combination of cash flows generated from operations, capital markets transactions, and borrowings on the Revolving Facility.

The three investment-grade credit ratings we maintain provide us with access to the unsecured public bond market, which we may continue to use in the future to finance acquisitions, repay maturing debt, and maintain steady interest rates.

New Tax Legislation

Effective July 4, 2025, certain changes to U.S. tax law were approved that impact us and our shareholders. Among other changes, this legislation (i) permanently extends the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers under Section 199A of the Internal Revenue Code (the “Code”), (ii) increases the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries from 20% to 25% for taxable years beginning after December 31, 2025, and (iii) increases the base on which the 30% interest deduction limit under Section 163(j) of the Code applies by excluding depreciation, amortization, and depletion from the definition of “adjusted taxable income” (i.e., based on EBITDA rather than EBIT) for taxable years beginning after December 31, 2024.

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Table of Contents

Results of Operations

As of December 31, 2025, we own interests in a portfolio of 167 operating retail/mixed-use properties, excluding two operating retail properties classified as held for sale as of December 31, 2025 and Eastgate Crossing, which was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal. We also own interests in two standalone office properties, one development project that is currently under construction, and two additional properties with future redevelopment opportunities. The following table sets forth the total operating properties and development projects we own as of December 31, 2025, 2024 and 2023:

(1)Included within the operating retail/mixed-use properties are 10 properties that contain an office component as of December 31, 2025, 2024 and 2023.

Our development, redevelopment, and operating property acquisition and disposition activities between 2023 and 2025 affect the comparability of our r

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