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peco-20220930
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☑    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2022
OR
☐     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File Number: 000-54691
https://cdn.kscope.io/4d6d91de87ce7a9894dc0ba25041fc52-peco-20220930_g1.jpg
PHILLIPS EDISON & COMPANY, INC.
(Exact name of registrant as specified in its charter)

Maryland27-1106076
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)

11501 Northlake Drive, Cincinnati, Ohio
45249
(Address of principal executive offices)(Zip code)

(513) 554-1110
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, par value $0.01 per sharePECONasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes☑No  ☐ 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).Yes☑No  ☐  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.    
Large accelerated filerAccelerated filerNon-accelerated filerSmaller reporting companyEmerging growth company
☐☐☑☐☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes☐No  ☑
There were 117.1 million shares of the registrant’s Common Stock, $0.01 par value per share, outstanding as of October 31, 2022.


PHILLIPS EDISON & COMPANY, INC. FORM 10-Q
TABLE OF CONTENTS
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
1

w PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2022 AND DECEMBER 31, 2021
(Condensed and Unaudited)
(In thousands, except per share amounts)
  September 30, 2022December 31, 2021
ASSETS    
Investment in real estate:    
Land and improvements$1,656,666 $1,586,993 
Building and improvements3,539,035 3,355,433 
In-place lease assets470,184 452,504 
Above-market lease assets72,294 68,736 
Total investment in real estate assets5,738,179 5,463,666 
Accumulated depreciation and amortization(1,272,653)(1,110,426)
Net investment in real estate assets4,465,526 4,353,240 
Investment in unconsolidated joint ventures27,601 31,326 
Total investment in real estate assets, net4,493,127 4,384,566 
Cash and cash equivalents4,789 92,585 
Restricted cash19,657 22,944 
Goodwill29,066 29,066 
Other assets, net183,774 138,050 
Real estate investments and other assets held for sale— 1,557 
Total assets$4,730,413 $4,668,768 
LIABILITIES AND EQUITY    
Liabilities:    
Debt obligations, net$1,872,939 $1,891,722 
Below-market lease liabilities, net108,548 107,526 
Earn-out liability— 52,436 
Derivative liabilities— 24,096 
Deferred income21,586 19,145 
Accounts payable and other liabilities112,433 97,229 
Liabilities of real estate investments held for sale— 288 
Total liabilities2,115,506 2,192,442 
Commitments and contingencies (see Note 8)
— — 
Equity:    
Preferred stock, $0.01 par value per share, 10,000 shares authorized, zero shares issued and
outstanding at September 30, 2022 and December 31, 2021
— — 
Common stock, $0.01 par value per share, 1,000,000 shares authorized, 117,084 shares issued
and outstanding at September 30, 2022; 650,000 shares authorized, 19,550 shares issued and outstanding at December 31, 2021
1,170 196 
Class B common stock, $0.01 par value per share, zero shares authorized, issued, and outstanding
at September 30, 2022; 350,000 shares authorized, 93,665 shares issued and outstanding at
December 31, 2021
— 936 
Additional paid-in capital (“APIC”)3,381,638 3,264,038 
Accumulated other comprehensive income (loss) (“AOCI”)
21,123 (24,819)
Accumulated deficit(1,150,337)(1,090,837)
Total stockholders’ equity2,253,594 2,149,514 
Noncontrolling interests361,313 326,812 
Total equity2,614,907 2,476,326 
Total liabilities and equity$4,730,413 $4,668,768 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
2


PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022 AND 2021
(Condensed and Unaudited)
(In thousands, except per share amounts)
Three Months Ended September 30,Nine Months Ended September 30,
  2022202120222021
Revenues:
Rental income$142,857 $128,826 $418,835 $386,784 
Fees and management income2,081 2,435 9,323 7,095 
Other property income716 1,073 2,175 1,906 
Total revenues145,654 132,334 430,333 395,785 
Operating Expenses:
Property operating23,089 21,608 69,261 65,784 
Real estate taxes18,041 16,375 52,005 49,762 
General and administrative10,843 11,627 33,751 32,905 
Depreciation and amortization60,013 53,901 178,008 165,829 
Impairment of real estate assets— 698 — 6,754 
Total operating expenses111,986 104,209 333,025 321,034 
Other:
Interest expense, net(17,569)(18,570)(52,895)(57,765)
(Loss) gain on disposal of property, net(10)14,093 4,151 31,678 
Other expense, net(3,916)(7,086)(9,738)(25,595)
Net income12,173 16,562 38,826 23,069 
Net income attributable to noncontrolling interests(1,135)(1,929)(4,181)(2,739)
Net income attributable to stockholders$11,038 $14,633 $34,645 $20,330 
Earnings per share of common stock:
Net income per share attributable to stockholders - basic and
  diluted (see Note 10)
$0.09 $0.13 $0.30 $0.21 
Comprehensive income:
Net income$12,173 $16,562 $38,826 $23,069 
Other comprehensive income:
Change in unrealized value on interest rate swaps14,008 4,488 51,415 19,981 
Comprehensive income26,181 21,050 90,241 43,050 
Net income attributable to noncontrolling interests(1,135)(1,929)(4,181)(2,739)
Change in unrealized value on interest rate swaps attributable to noncontrolling interests(1,513)(562)(5,750)(2,471)
Reallocation of comprehensive income (loss) upon conversion of noncontrolling interests57 — 277 (10)
Comprehensive income attributable to stockholders$23,590 $18,559 $80,587 $37,830 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
3

PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF EQUITY
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2022 AND 2021
(Condensed and Unaudited)
(In thousands, except per share amounts)
Three Months Ended September 30, 2022 and 2021
  Common StockClass B Common StockAPICAOCIAccumulated DeficitTotal Stockholders’ EquityNoncontrolling InterestsTotal Equity
  SharesAmountSharesAmount
Balance at July 1, 2021— $— 93,640 $2,808 $2,749,680 $(38,732)$(1,041,617)$1,672,139 $323,249 $1,995,388 
Issuance of common stock19,550 196 — — 547,205 — — 547,401 — 547,401 
Offering costs, discounts, and
    commissions		— — — — (39,042)— — (39,042)— (39,042)
Change in unrealized value on interest
    rate swaps		— — — — — 3,926 — 3,926 562 4,488 
Common distributions declared, $0.255
   per share
— — — — — — (27,499)(27,499)— (27,499)
Distributions to noncontrolling interests— — — — — — — — (3,536)(3,536)
Share-based compensation— — 23 (1)1,871 — — 1,870 2,116 3,986 
Impact of reverse stock split— — — (1,871)1,871 — — — — — 
Net income— — — — — — 14,633 14,633 1,929 16,562 
Balance at September 30, 202119,550 $196 93,663 $936 $3,261,585 $(34,806)$(1,054,483)$2,173,428 $324,320 $2,497,748 
Balance at July 1, 2022115,782 $1,157 — $— $3,341,646 $8,571 $(1,129,151)$2,222,223 $372,422 $2,594,645 
Issuance of common stock773 8 — — 26,409 — — 26,417 — 26,417 
Offering costs, discounts, and
    commissions		— — — — (348)— — (348)— (348)
Change in unrealized value on interest
    rate swaps		— — — — — 12,495 — 12,495 1,513 14,008 
Common distributions declared, $0.2733
    per share
— — — — — — (32,224)(32,224)— (32,224)
Distributions to noncontrolling interests— — — — — — — — (3,932)(3,932)
Share-based compensation1 — — — 2,384 — — 2,384 1,784 4,168 
Conversion of noncontrolling interests528 5 — — 11,547 57 — 11,609 (11,609)— 
Net income— — — — — — 11,038 11,038 1,135 12,173 
Balance at September 30, 2022117,084 $1,170 — $— $3,381,638 $21,123 $(1,150,337)$2,253,594 $361,313 $2,614,907 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
4


PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF EQUITY
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022 AND 2021
(Condensed and Unaudited)
(In thousands, except per share amounts)
Nine Months Ended September 30, 2022 and 2021
  Common StockClass B Common StockAPICAOCIAccumulated DeficitTotal Stockholders’ EquityNoncontrolling InterestsTotal Equity
  SharesAmountSharesAmount
Balance at January 1, 2021— $— 93,279 $2,798 $2,739,358 $(52,306)$(999,491)$1,690,359 $325,570 $2,015,929 
Issuance of common stock19,550 196 — — 547,205 — — 547,401 — 547,401 
Offering costs, discounts, and
    commissions		— — — — (39,042)— — (39,042)— (39,042)
Dividend reinvestment plan (“DRIP”)— — 280 8 7,360 — — 7,368 — 7,368 
Share repurchases— — (24)— (123)— — (123)— (123)
Change in unrealized value on interest
    rate swaps		— — — — — 17,510 — 17,510 2,471 19,981 
Common distributions declared, $0.765
    per share
— — — — — — (75,322)(75,322)— (75,322)
Distributions to noncontrolling interests— — — — — — — — (10,315)(10,315)
Share-based compensation— — 100 1 4,298 — — 4,299 4,532 8,831 
Conversion of noncontrolling interests— — 28 — 687 (10)— 677 (677)— 
Impact of reverse stock split— — — (1,871)1,871 — — — — — 
Other— — — — (29)— — (29)— (29)
Net income— — — — — — 20,330 20,330 2,739 23,069 
Balance at September 30, 202119,550 $196 93,663 $936 $3,261,585 $(34,806)$(1,054,483)$2,173,428 $324,320 $2,497,748 
Balance at January 1, 202219,550 $196 93,665 $936 $3,264,038 $(24,819)$(1,090,837)$2,149,514 $326,812 $2,476,326 
Conversion of Class B common stock93,665 936 (93,665)(936)— — — — — — 
Issuance of common stock2,633 26 — — 90,098 — — 90,124 — 90,124 
Offering costs, discounts, and
    commissions		— — — — (1,090)— — (1,090)— (1,090)
Change in unrealized value on interest
    rate swaps		— — — — — 45,665 — 45,665 5,750 51,415 
Common distributions declared, $0.8133
    per share
— — — — — — (94,145)(94,145)— (94,145)
Distributions to noncontrolling interests— — — — — — — — (12,149)(12,149)
Share-based compensation103 1 — — 3,859 — — 3,860 7,495 11,355 
Conversion of noncontrolling interests1,133 11 — — 24,733 277 — 25,021 (25,021)— 
Settlement of earn-out liability— — — — — — — — 54,245 54,245 
Net income— — — — — — 34,645 34,645 4,181 38,826 
Balance at September 30, 2022117,084 $1,170 — $— $3,381,638 $21,123 $(1,150,337)$2,253,594 $361,313 $2,614,907 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
5


PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022 AND 2021
(Condensed and Unaudited)
(In thousands)
Nine Months Ended September 30,
  20222021
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income
$38,826 $23,069 
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization of real estate assets175,305 162,979 
Impairment of real estate assets— 6,754 
Depreciation and amortization of corporate assets2,703 2,850 
Net amortization of above- and below-market leases(3,161)(2,633)
Amortization of deferred financing expenses2,516 3,581 
Amortization of debt and derivative adjustments1,838 1,133 
Gain on disposal of property, net
(4,151)(31,678)
Change in fair value of earn-out liability1,809 23,000 
Straight-line rent(9,086)(6,884)
Share-based compensation11,355 8,831 
Return on investment in unconsolidated joint ventures1,247 1,520 
Other297 1,213 
Changes in operating assets and liabilities:    
Other assets, net(8,620)(7,470)
Accounts payable and other liabilities17,885 12,048 
Net cash provided by operating activities
228,763 198,313 
CASH FLOWS FROM INVESTING ACTIVITIES:    
Real estate acquisitions(229,895)(88,954)
Capital expenditures(74,348)(49,315)
Proceeds from sale of real estate, net27,286 180,340 
Investment in third parties— (3,000)
Return of investment in unconsolidated joint ventures3,682 4,278 
Investment in marketable securities(3,000)(5,514)
Net cash (used in) provided by investing activities
(276,275)37,835 
CASH FLOWS FROM FINANCING ACTIVITIES:    
Proceeds from revolving credit facility282,000 9,000 
Payments on revolving credit facility(227,000)(9,000)
Proceeds from loans payable— 480,000 
Payments on mortgages and loans payable(80,628)(1,077,422)
Distributions paid, net of DRIP(94,118)(75,669)
Distributions to noncontrolling interests(12,859)(11,344)
Proceeds from issuance of common stock90,124 547,401 
Payment of offering costs(1,090)(39,042)
Repurchases of Class B common stock— (77,765)
Other— (29)
Net cash used in financing activities
(43,571)(253,870)
NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
(91,083)(17,722)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH:    
Beginning of period115,529 131,937 
End of period$24,446 $114,215 
RECONCILIATION TO CONSOLIDATED BALANCE SHEETS:
Cash and cash equivalents$4,789 $24,455 
Restricted cash19,657 89,760 
Cash, cash equivalents, and restricted cash at end of period$24,446 $114,215 
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
6

PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022 AND 2021
(Condensed and Unaudited)
(In thousands)
Nine Months Ended September 30,
  20222021
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest$47,352 $53,463 
SUPPLEMENTAL SCHEDULE OF NON-CASH ACTIVITIES:
Settlement of earn-out liability54,245 — 
Right-of-use (“ROU”) assets obtained in exchange for new lease liabilities— 239 
Accrued capital expenditures6,887 4,075 
Change in distributions payable27 (7,715)
Change in distributions payable - noncontrolling interests(710)(1,029)
Change in accrued share repurchase obligation— (77,642)
Distributions reinvested— 7,368 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
7


Phillips Edison & Company, Inc.
Notes to Consolidated Financial Statements
(Condensed and Unaudited)
As of and for the period ended September 30, 2022

1. ORGANIZATION
Phillips Edison & Company, Inc. (“we,” the “Company,” “PECO,” “our,” or “us”) was formed as a Maryland corporation in October 2009. Substantially all of our business is conducted through Phillips Edison Grocery Center Operating Partnership I, L.P., (the “Operating Partnership”), a Delaware limited partnership formed in December 2009. We are a limited partner of the Operating Partnership, and our wholly-owned subsidiary, Phillips Edison Grocery Center OP GP I LLC, is the sole general partner of the Operating Partnership.
We are a real estate investment trust (“REIT”) that invests primarily in omni-channel grocery-anchored neighborhood and community shopping centers that have a mix of creditworthy national, regional, and local retailers that sell necessity-based goods and services in strong demographic markets throughout the United States. In addition to managing our own shopping centers, our third-party investment management business provides comprehensive real estate and asset management services to two unconsolidated institutional joint ventures, in which we have a partial ownership interest, and one private fund (collectively, the “Managed Funds”) as of September 30, 2022.
As of September 30, 2022, we wholly-owned 270 real estate properties. Additionally, we owned a 14% interest in Grocery Retail Partners I LLC (“GRP I”), a joint venture that owned 20 properties.
In May 2022, we sold the final property in our joint venture with Necessity Retail Partners (“NRP”), in which we own a 20% interest. We recognized no income during the three months ended September 30, 2022 and $2.7 million in income during the nine months ended September 30, 2022 related to NRP’s achievement of certain performance targets, which is included in Fees and Management Income in our consolidated statements of operations and comprehensive income (“consolidated statements of operations”).
Underwritten Initial Public Offering—On July 19, 2021, we closed our underwritten initial public offering (“underwritten IPO”), through which we issued 19.6 million shares, including the underwriters’ overallotment election, of a new class of common stock, $0.01 par value per share, at an initial price to the public of $28.00 per share. As a result of the underwritten IPO, we received gross proceeds of $547.4 million.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Set forth below is a summary of the significant accounting estimates and policies that management believes are important to the preparation of our condensed consolidated interim financial statements. Certain of our accounting estimates are particularly important for an understanding of our financial position and results of operations and require the application of significant judgment by management. For example, significant estimates and assumptions have been made with respect to the useful lives of assets, remaining hold periods of assets, recoverable amounts of receivables, and other fair value measurement assessments required for the preparation of the consolidated interim financial statements. As a result, these estimates are subject to a degree of uncertainty.
There were no changes to our significant accounting policies during the nine months ended September 30, 2022, except for those discussed below. For a full summary of our significant accounting policies, refer to our 2021 Annual Report on Form 10-K, filed with the SEC on February 16, 2022.
Basis of Presentation and Principles of Consolidation—The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Readers of this Quarterly Report on Form 10-Q should refer to our audited consolidated financial statements for the year ended December 31, 2021, which are included in our 2021 Annual Report on Form 10-K. In the opinion of management, all normal and recurring adjustments necessary for the fair presentation of the unaudited consolidated financial statements for the periods presented have been included in this Quarterly Report. Our results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the operating results expected for the full year.
The accompanying consolidated financial statements include our accounts and the accounts of the Operating Partnership and its wholly-owned subsidiaries (over which we exercise financial and operating control). The financial statements of the Operating Partnership are prepared using accounting policies consistent with our accounting policies. All intercompany balances and transactions are eliminated upon consolidation.
The basis of presentation of our shares of common stock is described as follows:
•Reverse Stock Split—On July 2, 2021, our board of directors (the “Board”) approved an amendment to our charter to effect a one-for-three reverse stock split. Concurrent with the reverse split, the Operating Partnership enacted a one-
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
8

for-three reverse split of its outstanding Operating Partnership units (“OP units”). Unless otherwise indicated, the information in this Form 10-Q gives effect to the reverse stock and OP unit splits (see Note 9).
•Recapitalization—On June 18, 2021, our stockholders approved an amendment to our charter (the “Articles of Amendment”) that effected a change of each share of our common stock outstanding at the time the amendment became effective into one share of a newly created class of Class B common stock (the “Recapitalization”). The Articles of Amendment became effective on July 2, 2021. Unless otherwise indicated, all information in this Form 10-Q gives effect to the Recapitalization and references to “shares” and per share metrics refer to our common stock and Class B common stock, collectively. Our Class B common stock automatically converted into our publicly traded common stock on January 18, 2022 (see Note 9). Prior to the conversion, we have presented common stock and Class B common stock as separate classes within our consolidated balance sheets and consolidated statements of equity. On May 5, 2022, we filed Articles Supplementary to our charter with the Maryland State Department of Assessments and Taxation in order to reclassify and designate all of the 350 million authorized shares of our Class B common stock, $0.01 par value per share, all of which were unissued at such time, as shares of our common stock, $0.01 par value per share. We no longer have Class B common stock authorized for issue.
Income Taxes—Our consolidated financial statements include the operations of wholly-owned subsidiaries that have jointly elected to be treated as taxable REIT subsidiary entities and are subject to U.S. federal, state, and local income taxes at regular corporate tax rates. We recognized an insignificant amount of federal, state, and local income tax expense for the three and nine months ended September 30, 2022 and 2021, and we retain a full valuation allowance for our net deferred tax asset. All income tax amounts are included in Other Expense, Net on our consolidated statements of operations.
Newly Adopted Accounting Pronouncements—There were no newly adopted accounting pronouncements during the nine months ended September 30, 2022 that impacted the Company.
Reclassifications—Certain prior year amounts have been reclassified to conform to the current year presentation.

3. LEASES
Lessor—The majority of our leases are largely similar in that the leased asset is retail space within our properties, and the lease agreements generally contain similar provisions and features, without substantial variations. All of our leases are currently classified as operating leases. Lease income related to our operating leases was as follows (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Rental income related to fixed lease
   payments(1)
$105,252 $95,080 $309,925 $284,531 
Rental income related to variable
   lease payments(1)(2)
32,545 29,919 95,443 88,774 
Straight-line rent amortization(3)
3,752 2,365 8,617 6,627 
Amortization of lease assets1,059 898 3,113 2,602 
Lease buyout income221 560 2,362 3,138 
Adjustments for collectibility(4)
28 4 (625)1,112 
Total rental income$142,857 $128,826 $418,835 $386,784 
(1)Includes rental income related to lease payments before assessing for collectibility.
(2)Variable payments are primarily related to tenant recovery income.
(3)Includes revenue adjustments to straight-line rent for tenants considered non-creditworthy.
(4)Includes general reserves as well as adjustments for tenants considered non-creditworthy for which we are recording revenue on a cash basis, per Accounting Standards Codification (“ASC”) Topic 842, Leases.
Approximate future fixed contractual lease payments to be received under non-cancelable operating leases in effect as of September 30, 2022, assuming no new or renegotiated leases or option extensions on lease agreements, and including the impact of rent abatements and tenants who have been moved to the cash basis of accounting for revenue recognition purposes, are as follows (in thousands):
YearAmount
Remaining 2022$102,503 
2023412,634 
2024364,652 
2025307,774 
2026243,613 
Thereafter626,853 
Total$2,058,029 
No single tenant comprised 10% or more of our aggregate annualized base rent (“ABR”) as of September 30, 2022. As of September 30, 2022, our wholly-owned real estate investments in Florida and California represented 11.7% and 10.6% of our
PHILLIPS EDISON & COMPANY
SEPTEMBER 30, 2022 FORM 10-Q
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ABR, respectively. As a result, the geographic concentration of our portfolio makes it particularly susceptible to adverse weather or economic events in the Florida and California real estate markets (See “Hurricane Ian” in Note 4).

4. REAL ESTATE ACTIVITY
Acquisitions—The following table summarizes our real estate acquisition activity (dollars in thousands):
Nine Months Ended September 30,
20222021
Number of properties acquired5 4 
Number of outparcels acquired(1)
3 3 
Contract price$228,842 $88,451 
Total price of acquisitions(2)
229,895 88,954 
(1)Outparcels acquired are adjacent to shopping centers that we own.
(2)Total price of acquisitions includes closing costs and credits.
The aggregate purchase price of the assets acquired during the nine months ended September 30, 2022 and 2021 were allocated as follows (in thousands):
September 30, 2022September 30, 2021
ASSETS
   Land and improvements$71,564 $35,173 
   Building and improvements144,988 52,105 
   In-place lease assets19,296 8,728 
   Above-market lease assets