cik0001476204-20220331
Q12022FALSE0001476204--12-310.3300014762042022-01-012022-03-3100014762042022-04-29xbrli:shares00014762042022-03-31iso4217:USD00014762042021-12-31iso4217:USDxbrli:shares0001476204us-gaap:CommonStockMember2021-12-310001476204us-gaap:CommonStockMember2022-03-310001476204us-gaap:CommonClassBMember2022-03-310001476204us-gaap:CommonClassBMember2021-12-3100014762042021-01-012021-03-310001476204us-gaap:CommonStockMemberus-gaap:CommonStockMember2020-12-310001476204us-gaap:CommonClassBMemberus-gaap:CommonStockMember2020-12-310001476204us-gaap:AdditionalPaidInCapitalMember2020-12-310001476204us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310001476204us-gaap:RetainedEarningsMember2020-12-310001476204us-gaap:ParentMember2020-12-310001476204us-gaap:NoncontrollingInterestMember2020-12-3100014762042020-12-310001476204us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-01-012021-03-310001476204us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001476204us-gaap:ParentMember2021-01-012021-03-310001476204us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310001476204us-gaap:NoncontrollingInterestMember2021-01-012021-03-310001476204us-gaap:RetainedEarningsMember2021-01-012021-03-310001476204us-gaap:CommonStockMemberus-gaap:CommonStockMember2021-03-310001476204us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-03-310001476204us-gaap:AdditionalPaidInCapitalMember2021-03-310001476204us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310001476204us-gaap:RetainedEarningsMember2021-03-310001476204us-gaap:ParentMember2021-03-310001476204us-gaap:NoncontrollingInterestMember2021-03-3100014762042021-03-310001476204us-gaap:CommonStockMemberus-gaap:CommonStockMember2021-12-310001476204us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-12-310001476204us-gaap:AdditionalPaidInCapitalMember2021-12-310001476204us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001476204us-gaap:RetainedEarningsMember2021-12-310001476204us-gaap:ParentMember2021-12-310001476204us-gaap:NoncontrollingInterestMember2021-12-310001476204us-gaap:CommonStockMemberus-gaap:CommonStockMember2022-01-012022-03-310001476204us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-01-012022-03-310001476204us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310001476204us-gaap:ParentMember2022-01-012022-03-310001476204us-gaap:NoncontrollingInterestMember2022-01-012022-03-310001476204us-gaap:RetainedEarningsMember2022-01-012022-03-310001476204us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001476204us-gaap:CommonStockMemberus-gaap:CommonStockMember2022-03-310001476204us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-03-310001476204us-gaap:AdditionalPaidInCapitalMember2022-03-310001476204us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310001476204us-gaap:RetainedEarningsMember2022-03-310001476204us-gaap:ParentMember2022-03-310001476204us-gaap:NoncontrollingInterestMember2022-03-31cik0001476204:property0001476204cik0001476204:GroceryRetailPartnersIMember2022-03-31xbrli:pure0001476204cik0001476204:NecessityRetailPartnersMember2022-03-3100014762042021-07-192021-07-1900014762042021-07-190001476204us-gaap:IPOMember2021-07-1900014762042021-08-0200014762042021-07-022021-07-020001476204us-gaap:GeographicConcentrationRiskMemberus-gaap:SalesRevenueNetMemberstpr:FL2022-01-012022-03-310001476204stpr:CAus-gaap:GeographicConcentrationRiskMemberus-gaap:SalesRevenueNetMember2022-01-012022-03-31cik0001476204:landParcel0001476204us-gaap:LandAndLandImprovementsMember2022-01-012022-03-310001476204us-gaap:LandAndLandImprovementsMember2021-01-012021-03-310001476204us-gaap:BuildingAndBuildingImprovementsMember2022-01-012022-03-310001476204us-gaap:BuildingAndBuildingImprovementsMember2021-01-012021-03-310001476204us-gaap:LeasesAcquiredInPlaceMember2022-01-012022-03-310001476204us-gaap:LeasesAcquiredInPlaceMember2021-01-012021-03-310001476204us-gaap:AboveMarketLeasesMember2022-01-012022-03-310001476204us-gaap:AboveMarketLeasesMember2021-01-012021-03-310001476204us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember2021-12-310001476204us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember2022-03-310001476204us-gaap:RevolvingCreditFacilityMember2022-01-012022-03-310001476204us-gaap:RevolvingCreditFacilityMember2022-03-310001476204us-gaap:RevolvingCreditFacilityMember2021-12-310001476204cik0001476204:TermLoanFacilityMembersrt:MinimumMember2022-03-310001476204srt:MaximumMembercik0001476204:TermLoanFacilityMember2022-03-310001476204cik0001476204:TermLoanFacilityMember2022-03-310001476204cik0001476204:TermLoanFacilityMember2021-12-310001476204us-gaap:SeniorNotesMembercik0001476204:SeniorNotesDueNovember2031Member2022-03-310001476204us-gaap:SeniorNotesMembercik0001476204:SeniorNotesDueNovember2031Member2021-12-310001476204srt:MinimumMemberus-gaap:SecuredDebtMember2022-03-310001476204srt:MaximumMemberus-gaap:SecuredDebtMember2022-03-310001476204cik0001476204:SecuredLoanFacilitiesMemberus-gaap:SecuredDebtMember2022-03-310001476204cik0001476204:SecuredLoanFacilitiesMemberus-gaap:SecuredDebtMember2021-12-310001476204us-gaap:MortgagesMembersrt:MinimumMember2022-03-310001476204srt:MaximumMemberus-gaap:MortgagesMember2022-03-310001476204us-gaap:MortgagesMember2022-03-310001476204us-gaap:MortgagesMember2021-12-310001476204us-gaap:MortgagesMember2022-01-012022-03-310001476204us-gaap:LongTermDebtMember2022-03-310001476204us-gaap:LongTermDebtMember2022-01-012022-03-310001476204us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2022-01-012022-03-310001476204us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2022-03-31cik0001476204:Debt_Instrument0001476204us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2021-12-310001476204us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMembersrt:MinimumMember2022-03-310001476204srt:MaximumMemberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2022-03-310001476204us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMembersrt:MinimumMember2021-12-310001476204srt:MaximumMemberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2021-12-310001476204us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2021-01-012021-06-300001476204us-gaap:InterestExpenseMember2022-01-012022-03-310001476204us-gaap:InterestExpenseMember2021-01-012021-03-31cik0001476204:obligationcik0001476204:vote00014762042022-02-1000014762042021-06-1800014762042022-01-180001476204us-gaap:CommonClassBMemberus-gaap:SubsequentEventMember2022-05-050001476204us-gaap:SubsequentEventMemberus-gaap:CommonStockMember2022-05-050001476204us-gaap:IPOMember2021-07-192021-07-190001476204us-gaap:OverAllotmentOptionMember2021-07-190001476204us-gaap:DividendDeclaredMember2022-03-012022-03-310001476204us-gaap:SubsequentEventMemberus-gaap:DividendPaidMember2022-04-012022-04-010001476204us-gaap:SubsequentEventMemberus-gaap:DividendDeclaredMember2022-04-012022-04-300001476204us-gaap:SubsequentEventMemberus-gaap:DividendPaidMember2022-05-022022-05-020001476204us-gaap:SubsequentEventMembersrt:ScenarioForecastMemberus-gaap:DividendDeclaredMember2022-06-012022-06-300001476204us-gaap:SubsequentEventMembersrt:ScenarioForecastMemberus-gaap:DividendDeclaredMember2022-07-012022-07-310001476204us-gaap:SubsequentEventMembersrt:ScenarioForecastMemberus-gaap:DividendDeclaredMember2022-05-012022-05-310001476204cik0001476204:PhillipsEdisonLimitedPartnershipMember2022-01-112022-01-110001476204us-gaap:CommonClassBMember2022-01-1800014762042021-04-290001476204cik0001476204:RelatedPartyRecurringFeesMembersrt:AffiliatedEntityMember2022-01-012022-03-310001476204cik0001476204:RelatedPartyRecurringFeesMembersrt:AffiliatedEntityMember2021-01-012021-03-310001476204cik0001476204:RelatedPartyTransactionalRevenueAndReimbursementsMembersrt:AffiliatedEntityMember2022-01-012022-03-310001476204cik0001476204:RelatedPartyTransactionalRevenueAndReimbursementsMembersrt:AffiliatedEntityMember2021-01-012021-03-310001476204cik0001476204:RelatedPartyInsurancePremiumsMember2022-01-012022-03-310001476204cik0001476204:RelatedPartyInsurancePremiumsMember2021-01-012021-03-310001476204srt:ExecutiveOfficerMembercik0001476204:TaxProtectionAgreementMember2021-07-192021-07-190001476204srt:ExecutiveOfficerMembercik0001476204:TaxProtectionAgreementMember2022-03-310001476204cik0001476204:NecessityRetailPartnersMember2022-03-310001476204cik0001476204:NecessityRetailPartnersMember2022-01-012022-03-310001476204cik0001476204:GroceryRetailPartnersIMember2022-03-310001476204us-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001476204us-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001476204cik0001476204:TermLoanFacilityMember2022-03-310001476204us-gaap:FairValueInputsLevel3Membercik0001476204:TermLoanFacilityMember2022-03-310001476204cik0001476204:TermLoanFacilityMember2021-12-310001476204us-gaap:FairValueInputsLevel3Membercik0001476204:TermLoanFacilityMember2021-12-310001476204us-gaap:SeniorNotesMember2022-03-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:SeniorNotesMember2022-03-310001476204us-gaap:SeniorNotesMember2021-12-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:SeniorNotesMember2021-12-310001476204us-gaap:SecuredDebtMember2022-03-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:SecuredDebtMember2022-03-310001476204us-gaap:SecuredDebtMember2021-12-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:SecuredDebtMember2021-12-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:MortgagesMember2022-03-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:MortgagesMember2021-12-310001476204us-gaap:FairValueInputsLevel3Member2022-03-310001476204us-gaap:FairValueInputsLevel3Member2021-12-310001476204us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001476204us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001476204us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001476204us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001476204us-gaap:FairValueInputsLevel1Memberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001476204us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueMeasurementsRecurringMember2022-03-310001476204us-gaap:FairValueInputsLevel1Memberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001476204us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001476204us-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001476204us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:FairValueInputsLevel1Member2022-03-310001476204us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:FairValueInputsLevel2Member2022-03-310001476204us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:FairValueInputsLevel3Member2022-03-310001476204us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:FairValueInputsLevel1Member2021-12-310001476204us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:FairValueInputsLevel2Member2021-12-310001476204us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:FairValueInputsLevel3Member2021-12-310001476204cik0001476204:PhillipsEdisonLimitedPartnershipMembersrt:MinimumMember2019-01-012019-12-310001476204srt:MaximumMembercik0001476204:PhillipsEdisonLimitedPartnershipMember2019-01-012019-12-310001476204cik0001476204:PhillipsEdisonLimitedPartnershipMember2019-01-012019-12-31cik0001476204:tradingDay0001476204cik0001476204:PhillipsEdisonLimitedPartnershipMembersrt:MinimumMember2019-12-310001476204srt:MaximumMembercik0001476204:PhillipsEdisonLimitedPartnershipMember2019-12-310001476204us-gaap:FairValueInputsLevel3Membercik0001476204:ContingentConsiderationMemberus-gaap:FairValueMeasurementsRecurringMember2022-01-112022-01-11

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 March 31, 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/2aaf35d06514619b5969e0f09dc2ec4f-cik0001476204-20220331_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. YesNo  ☐ 
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).YesNo  ☐  
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). YesNo  ☑
There were 113.9 million shares of the registrant’s Common Stock, $0.01 par value per share, outstanding as of April 29, 2022.



PHILLIPS EDISON & COMPANY, INC. FORM 10-Q
TABLE OF CONTENTS
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE THREE MONTHS ENDED MARCH 31, 2022
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
1


w PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2022 AND DECEMBER 31, 2021
(Condensed and Unaudited)
(In thousands, except per share amounts)
  March 31, 2022December 31, 2021
ASSETS    
Investment in real estate:    
Land and improvements$1,611,991 $1,586,993 
Building and improvements3,423,548 3,355,433 
In-place lease assets460,127 452,504 
Above-market lease assets69,187 68,736 
Total investment in real estate assets5,564,853 5,463,666 
Accumulated depreciation and amortization(1,161,965)(1,110,426)
Net investment in real estate assets4,402,888 4,353,240 
Investment in unconsolidated joint ventures30,491 31,326 
Total investment in real estate assets, net4,433,379 4,384,566 
Cash and cash equivalents5,063 92,585 
Restricted cash12,406 22,944 
Goodwill29,066 29,066 
Other assets, net153,720 138,050 
Real estate investments and other assets held for sale6,547 1,557 
Total assets$4,640,181 $4,668,768 
LIABILITIES AND EQUITY    
Liabilities:    
Debt obligations, net$1,876,208 $1,891,722 
Below-market lease liabilities, net107,869 107,526 
Earn-out liability 52,436 
Derivative liabilities2,217 24,096 
Deferred income21,941 19,145 
Accounts payable and other liabilities94,079 97,229 
Liabilities of real estate investments held for sale198 288 
Total liabilities2,102,512 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 March 31, 2022 and December 31, 2021
  
Common stock, $0.01 par value per share, 650,000 shares authorized, 113,819 and 19,550
    
shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively
1,138 196 
Class B common stock, $0.01 par value per share, 350,000 shares authorized, zero and 93,665
shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively
 936 
Additional paid-in capital (“APIC”)3,276,151 3,264,038 
Accumulated other comprehensive loss (“AOCI”)
(160)(24,819)
Accumulated deficit(1,111,673)(1,090,837)
Total stockholders’ equity2,165,456 2,149,514 
Noncontrolling interests372,213 326,812 
Total equity2,537,669 2,476,326 
Total liabilities and equity$4,640,181 $4,668,768 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
2


PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(Condensed and Unaudited)
(In thousands, except per share amounts)
Three Months Ended March 31,
  20222021
Revenues:
Rental income$138,748 $127,623 
Fees and management income2,461 2,286 
Other property income954 472 
Total revenues142,163 130,381 
Operating Expenses:
Property operating23,320 22,202 
Real estate taxes17,491 16,573 
General and administrative11,532 9,341 
Depreciation and amortization57,226 55,341 
Impairment of real estate assets 5,000 
Total operating expenses109,569 108,457 
Other:
Interest expense, net(18,199)(20,063)
Gain on disposal of property, net1,368 13,841 
Other expense, net(4,365)(15,585)
Net income11,398 117 
Net income attributable to noncontrolling interests(1,319)(14)
Net income attributable to stockholders$10,079 $103 
Earnings per share of common stock:
Net income per share attributable to stockholders - basic and diluted (see Note 10)
$0.09 $0.00 
Comprehensive income:
Net income$11,398 $117 
Other comprehensive income:
Change in unrealized value on interest rate swaps27,573 12,120 
Comprehensive income38,971 12,237 
Net income attributable to noncontrolling interests(1,319)(14)
Change in unrealized value on interest rate swaps attributable to noncontrolling interests(2,702)(1,509)
Reallocation of comprehensive loss upon conversion of noncontrolling interests(212)$ 
Comprehensive income attributable to stockholders$34,738 $10,714 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
3


PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(Condensed and Unaudited)
(In thousands, except per share amounts)
Three Months Ended March 31, 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 
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
— — — — — 10,611 — 10,611 1,509 12,120 
Common distributions declared, $0.255
   per share
— — — — — — (23,767)(23,767)— (23,767)
Distributions to noncontrolling interests— — — — — — — — (3,319)(3,319)
Share-based compensation— — 47 1 325 — — 326 784 1,110 
Other— — — — (29)— — (29)— (29)
Net income— — — — — — 103 103 14 117 
Balance at March 31, 2021 $ 93,582 $2,807 $2,746,891 $(41,695)$(1,023,155)$1,684,848 $324,558 $2,009,406 
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)— — — — —  
Change in unrealized value on interest
    rate swaps
— — — — — 24,871 — 24,871 2,702 27,573 
Common distributions declared, $0.27
    per share
— — — — — — (30,915)(30,915)— (30,915)
Distributions to noncontrolling interests— — — — — — — — (4,104)(4,104)
Share-based compensation71 1 — — 467 — — 468 2,678 3,146 
Conversion of noncontrolling interests533 5 — — 17,313 — — 17,318 (17,318) 
Reallocation of operating partnership
interests
— — — — (5,667)(212)— (5,879)5,879  
Settlement of earn-out liability— — — — — — — — 54,245 54,245 
Net income— — — — — — 10,079 10,079 1,319 11,398 
Balance at March 31, 2022113,819 $1,138  $ $3,276,151 $(160)$(1,111,673)$2,165,456 $372,213 $2,537,669 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
4


PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(Condensed and Unaudited)
(In thousands)
Three Months Ended March 31,
  20222021
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income
$11,398 $117 
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization of real estate assets56,321 54,341 
Impairment of real estate assets 5,000 
Depreciation and amortization of corporate assets905 1,000 
Net amortization of above- and below-market leases(1,002)(838)
Amortization of deferred financing expenses801 1,227 
Amortization of debt and derivative adjustments586 354 
Gain on disposal of property, net
(1,368)(13,841)
Change in fair value of earn-out liability1,809 16,000 
Straight-line rent(1,818)(1,424)
Share-based compensation3,146 1,110 
Return on investment in unconsolidated joint ventures 1,546 
Other487 (567)
Changes in operating assets and liabilities:    
Other assets, net(10,978)(10,787)
Accounts payable and other liabilities(66)(4,487)
Net cash provided by operating activities
60,221 48,751 
CASH FLOWS FROM INVESTING ACTIVITIES:    
Real estate acquisitions(101,440)(39,850)
Capital expenditures(18,608)(13,537)
Proceeds from sale of real estate, net12,770 58,356 
Investment in third parties (3,000)
Return of investment in unconsolidated joint ventures781 2,721 
Net cash (used in) provided by investing activities
(106,497)4,690 
CASH FLOWS FROM FINANCING ACTIVITIES:    
Proceeds from revolving credit facility102,000  
Payments on revolving credit facility(56,000) 
Payments on mortgages and loans payable(62,515)(16,505)
Distributions paid, net of DRIP(30,926)(24,296)
Distributions to noncontrolling interests(4,343)(4,530)
Repurchases of Class B common stock (77,765)
Other (29)
Net cash used in financing activities
(51,784)(123,125)
NET DECREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH
(98,060)(69,684)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH:    
Beginning of period115,529 131,937 
End of period$17,469 $62,253 
RECONCILIATION TO CONSOLIDATED BALANCE SHEETS:
Cash and cash equivalents$5,063 $20,258 
Restricted cash12,406 41,995 
Cash, cash equivalents, and restricted cash at end of period$17,469 $62,253 
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
5


PHILLIPS EDISON & COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(Condensed and Unaudited)
(In thousands)
Three Months Ended March 31,
  20222021
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest$14,849 $18,891 
SUPPLEMENTAL SCHEDULE OF NON-CASH ACTIVITIES:
Settlement of earn-out liability54,245  
Right-of-use (“ROU”) assets obtained in exchange for new lease liabilities 194 
Accrued capital expenditures6,486 3,442 
Change in distributions payable(11)(7,897)
Change in distributions payable - noncontrolling interests(239)(1,211)
Change in accrued share repurchase obligation (77,642)
Distributions reinvested 7,368 

See notes to consolidated financial statements.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
6



Phillips Edison & Company, Inc.
Notes to Consolidated Financial Statements
(Condensed and Unaudited)
As of and for the period ended March 31, 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 March 31, 2022.
As of March 31, 2022, we wholly-owned 269 real estate properties. Additionally, we owned a 14% interest in Grocery Retail Partners I LLC (“GRP I”), a joint venture that owned 20 properties, and a 20% equity interest in Necessity Retail Partners (“NRP”), a joint venture that owned one property.
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 three months ended March 31, 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 months ended March 31, 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-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
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
7


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.
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 months ended March 31, 2022 and 2021, and we retain a full valuation allowance for our deferred tax asset. All income tax amounts are included in Other Expense, Net on our consolidated statements of operations and comprehensive income (“consolidated statements of operations”).
Newly Adopted Accounting Pronouncements—There were no newly adopted accounting pronouncements during the three months ended March 31, 2022 that impacted the Company.

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 March 31,
20222021
Rental income related to fixed lease payments(1)
$101,510 $94,966 
Rental income related to variable lease payments(1)(2)
33,467 31,401 
Straight-line rent amortization(3)
1,695 1,369 
Amortization of lease assets992 827 
Lease buyout income1,964 797 
Adjustments for collectibility(4)
(880)(1,737)
Total rental income$138,748 $127,623 
(1)Includes rental income related to lease payments before assessing for collectibility.
(2)Variable payments are primarily related to tenant recovery income.
(3)For the three months ended March 31, 2022 and 2021, includes unfavorable revenue adjustments to straight-line rent for tenants considered non-creditworthy of $1.2 million and $0.8 million, respectively.
(4)Includes general reserves as well as adjustments for tenants not considered creditworthy for which we are recording revenue on a cash basis, per Accounting Standards Codification (“ASC”) Topic 842, Leases.
For the three months ended March 31, 2022 and 2021, we had net favorable changes to general reserves of $0.2 million and $2.3 million, respectively. Additionally, we had net unfavorable adjustments of $1.1 million and $4.0 million, respectively, related to monthly revenue for tenants that we deemed non-creditworthy and for which we were recording revenue on a cash basis.
Approximate future fixed contractual lease payments to be received under non-cancelable operating leases in effect as of March 31, 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$303,902 
2023374,916 
2024322,431 
2025266,544 
2026201,848 
Thereafter513,911 
Total$1,983,552 
No single tenant comprised 10% or more of our aggregate annualized base rent (“ABR”) as of March 31, 2022. As of March 31, 2022, our wholly-owned real estate investments in Florida and California represented 12.0% and 10.7% of our 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.

PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
8


4. REAL ESTATE ACTIVITY
AcquisitionsThe following table summarizes our real estate acquisition activity (dollars in thousands):
Three Months Ended March 31,
20222021
Number of properties acquired3 2 
Number of outparcels acquired(1)
 2 
Contract price$100,400 $39,605 
Total price of acquisitions(2)
101,440 39,850 
(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 three months ended March 31, 2022 and 2021 were allocated as follows (in thousands):
March 31, 2022March 31, 2021
ASSETS
   Land and improvements$30,274 $23,305 
   Building and improvements65,028 13,990 
   In-place lease assets8,557 4,155 
   Above-market lease assets708 52 
Total assets104,567 41,502 
LIABILITIES
   Below-market lease liabilities3,127 1,652 
Total liabilities3,127 1,652 
Net assets acquired$101,440 $39,850 
The weighted-average amortization periods for in-place, above-market, and below-market lease intangibles acquired during the three months ended March 31, 2022 and 2021 are as follows (in years):
March 31, 2022March 31, 2021
Acquired in-place leases147
Acquired above-market leases65
Acquired below-market leases246
Property DispositionsThe following table summarizes our real estate disposition activity (dollars in thousands):
Three Months Ended March 31,
20222021
Number of properties sold2 6 
Number of outparcels sold(1)
 1 
Contract Price$13,325 $60,563 
Proceeds from sale of real estate, net(2)
12,770 58,356 
Gain on sale of property, net(3)
1,368 14,355 
    
(1)During the three months ended March 31, 2021, the one outparcel sale included the only remaining portion of a property we previously owned; therefore, the sale resulted in a reduction in our total property count.
(2)Total proceeds from sale of real estate, net includes closing costs and credits.
(3)During the three months ended March 31, 2021, Gain on Disposal of Property, Net on the consolidated statements of operations includes miscellaneous write-off activity, which is not included in gain on sale of property, net, presented above.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
9


Property Held for Sale—As of March 31, 2022 and December 31, 2021, one property was classified as held for sale. A property classified as held for sale is under contract to sell, with no substantive contingencies, and the prospective buyer had significant funds at risk. A summary of assets and liabilities for the properties held for sale as of March 31, 2022 and December 31, 2021 is below (in thousands):
March 31, 2022December 31, 2021
ASSETS
Total investment in real estate assets, net $6,332 $1,554 
Other assets, net 215 3 
Total assets $6,547 $1,557 
LIABILITIES
Below-market lease liabilities, net $114 $284 
Accounts payable and other liabilities 84 4 
Total liabilities $198 $288 

5. OTHER ASSETS, NET
The following is a summary of Other Assets, Net outstanding as of March 31, 2022 and December 31, 2021, excluding amounts related to assets classified as held for sale (in thousands):
March 31, 2022December 31, 2021
Other assets, net:
Deferred leasing commissions and costs$45,688 $44,968 
Deferred financing expenses(1)
4,898 4,898 
Office equipment, including capital lease assets, and other25,833 24,823 
Corporate intangible assets6,690 6,706 
Total depreciable and amortizable assets83,109 81,395 
Accumulated depreciation and amortization(42,867)(41,236)
Net depreciable and amortizable assets40,242 40,159 
Accounts receivable, net(2)
39,002 36,762 
Accounts receivable - affiliates 638 711 
Deferred rent receivable, net(3)
41,756 40,212 
Derivative assets5,365  
Prepaid expenses and other18,528 11,655 
Investment in third parties3,000 3,000 
Investment in marketable securities5,189 5,551 
Total other assets, net$153,720 $138,050 
(1)Deferred financing expenses per the above table are related to our revolving credit facility, and as such we have elected to classify them as an asset rather than as a contra-liability.
(2)Net of $4.1 million and $3.5 million of general reserves for uncollectible amounts as of March 31, 2022 and December 31, 2021, respectively. Receivables that were removed for tenants considered to be non-creditworthy were $7.3 million and $9.2 million as of March 31, 2022 and December 31, 2021, respectively.
(3)Net of $5.8 million and $4.7 million of receivables removed as of March 31, 2022 and December 31, 2021, respectively, related to straight-line rent for tenants previously or currently considered to be non-creditworthy.

PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
10


6. DEBT OBLIGATIONS
The following is a summary of the outstanding principal balances and interest rates, which include the effect of derivative financial instruments, for our debt obligations as of March 31, 2022 and December 31, 2021 (dollars in thousands):
   
Interest Rate(1)
March 31, 2022December 31, 2021
Revolving credit facility
LIBOR + 1.1%
$46,000 $ 
Term loans(2)
1.6% - 4.2%
955,000 955,000 
Senior unsecured notes due 20312.6%350,000 350,000 
Secured loan facilities
3.4% - 3.5%
395,000 395,000 
Mortgages
3.5% - 6.4%
150,805 213,316 
Finance lease liability762 766 
Discount on notes payable(7,512)(7,680)
Assumed market debt adjustments, net(1,546)(1,530)
Deferred financing expenses, net(12,301)(13,150)
Total  $1,876,208 $1,891,722 
Weighted-average interest rate(3)
3.2 %3.3 %
(1)Interest rates are as of March 31, 2022.
(2)Our term loans carry an interest rate of LIBOR plus a spread. While most of the rates are fixed through the use of swaps, there is a portion of these loans that are not subject to a swap, and thus are still indexed to LIBOR.
(3)Includes the effects of derivative financial instruments (see Notes 7 and 12).
2022 Debt Activity—During the three months ended March 31, 2022, we executed early repayments of $61.0 million in mortgage debt.
Debt AllocationThe allocation of total debt between fixed-rate and variable-rate as well as between secured and unsecured, excluding market debt adjustments, discount on senior notes, and deferred financing expenses, net, and including the effects of derivative financial instruments as of March 31, 2022 and December 31, 2021 is summarized below (in thousands):
   March 31, 2022December 31, 2021
As to interest rate:
Fixed-rate debt(1)
$1,826,567 $1,889,082
Variable-rate debt71,000 25,000
Total$1,897,567 $1,914,082
As to collateralization:
Unsecured debt$1,351,000 $1,305,000
Secured debt546,567 609,082
Total  $1,897,567 $1,914,082
(1)Fixed-rate debt includes, and variable-rate debt excludes, the portion of such debt that has been hedged by interest rate derivatives. As of March 31, 2022, $930.0 million in variable rate debt is hedged to a fixed rate for a weighted-average of 1.9 years.

7. DERIVATIVES AND HEDGING ACTIVITIES
Risk Management Objective of Using Derivatives—We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposure to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity, and credit risk, primarily by managing the amount, sources, and duration of our debt funding, and through the use of derivative financial instruments. Specifically, we enter into interest rate swaps to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. Our derivative financial instruments are used to manage differences in the amount, timing, and duration of our known or expected cash receipts and our known or expected cash payments principally related to our investments and borrowings.
Cash Flow Hedges of Interest Rate Risk—Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for our making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.
The changes in the fair value of derivatives designated, and that qualify, as cash flow hedges are recorded in AOCI and are subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During the three
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
11


months ended March 31, 2022 and 2021, such derivatives were used to hedge the variable cash flows associated with certain variable-rate debt. Amounts reported in AOCI related to these derivatives will be reclassified to Interest Expense, Net as interest payments are made on the variable-rate debt. During the next twelve months, we estimate that an additional $3.2 million will be reclassified from AOCI as an increase to Interest Expense, Net.
The following is a summary of our interest rate swaps that were designated as cash flow hedges of interest rate risk as of March 31, 2022 and December 31, 2021 (dollars in thousands):
March 31, 2022December 31, 2021
Count5 5 
Notional amount$930,000 $930,000 
Fixed LIBOR
1.3% - 2.9%
1.3% - 2.9%
Maturity date2022-20252022 - 2025
Weighted-average term (in years)1.61.9
The table below details the nature of the gain and loss recognized on interest rate derivatives designated as cash flow hedges in the consolidated statements of operations (in thousands):
Three Months Ended March 31,
  20222021
Amount of gain recognized in Other Comprehensive Income
$22,899 $7,265 
Amount of loss reclassified from AOCI into Interest Expense, Net
4,674 4,855 
Credit-risk-related Contingent Features—We have agreements with our derivative counterparties that contain provisions where, if we default, or are capable of being declared in default, on any of our indebtedness, we could also be declared to be in default on our derivative obligations. As of March 31, 2022, the fair value of our derivatives in a net liability position, which included accrued interest but excluded any adjustment for nonperformance risk related to these agreements, was approximately $2.2 million. As of March 31, 2022, we had not posted any collateral related to these agreements and were not in breach of any agreement provisions. If we had breached any of these provisions, we could have been required to settle our obligations under the agreements at their termination value of $2.2 million.

8. COMMITMENTS AND CONTINGENCIES
Litigation—We are involved in various claims and litigation matters arising in the ordinary course of business, some of which involve claims for damages. Many of these matters are covered by insurance, although they may nevertheless be subject to deductibles or retentions. Although the ultimate liability for these matters cannot be determined, based upon information currently available, we believe the resolution of such claims and litigation will not have a material adverse effect on our consolidated financial statements.
Environmental Matters—In connection with the ownership and operation of real estate, we may potentially be liable for costs and damages related to environmental matters. In addition, we may own or acquire certain properties that are subject to environmental remediation. Depending on the nature of the environmental matter, the seller of the property, a tenant of the property, and/or another third party may be responsible for environmental remediation costs related to a property. Additionally, in connection with the purchase of certain properties, the respective sellers and/or tenants may agree to indemnify us against future remediation costs. We also carry environmental liability insurance on our properties that provides limited coverage for any remediation liability and/or pollution liability for third-party bodily injury and/or property damage claims for which we may be liable. We are not aware of any environmental matters which we believe are reasonably likely to have a material effect on our consolidated financial statements.
Captive Insurance—Our captive insurance company, Silver Rock Insurance, Inc. (“Silver Rock”), provides general liability insurance, wind, reinsurance, and other coverage to us and certain related-party joint ventures. We capitalize Silver Rock in accordance with applicable regulatory requirements.
Silver Rock established annual premiums based on the past loss experience of the insured properties. An independent third party was engaged to perform an actuarial estimate of projected future claims, related deductibles, and projected future expenses necessary to fund associated risk management programs. Premiums paid to Silver Rock may be adjusted based on this estimate, and such premiums may be reimbursed by tenants pursuant to specific lease terms.
As of March 31, 2022, we had four letters of credit outstanding totaling approximately $9.0 million to provide security for our obligations under Silver Rock’s insurance and reinsurance contracts.

9. EQUITY
General—The holders of common stock are entitled to one vote per share on all matters voted on by stockholders, including one vote per nominee in the election of the Board. Our charter does not provide for cumulative voting in the election of directors.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
12


At-the-Market Offering (“ATM”)—On February 10, 2022, we and the Operating Partnership entered into a sales agreement relating to the potential sale of shares of common stock pursuant to a continuous offering program. In accordance with the terms of the sales agreement, we may offer and sell shares of our common stock having an aggregate offering price of up to $250 million from time to time through our sales agents, or, if applicable, as forward sellers. As of March 31, 2022, we have issued zero shares under the ATM program.
Reverse Stock Split—On July 2, 2021, we effected a one-for-three reverse stock split. Concurrent with the reverse split, the Operating Partnership enacted a one-for-three reverse split of its outstanding OP units. Neither the number of authorized shares nor the par value of the common stock were impacted. As a result of the reverse split, every three shares of our common stock or OP units were automatically combined and converted into one issued and outstanding share of common stock or OP unit rounded to the nearest 1/100th share. The reverse stock split impacted all common stock and OP units proportionately and had no impact on any stockholder’s percentage ownership of common stock.
Class B Common Stock—On June 18, 2021, our stockholders approved Articles of Amendment that effected the Recapitalization, wherein each share of our common stock outstanding at the time the amendment became effective was converted into one share of a newly created class of Class B common stock.
Our Class B common stock was identical to our common stock, except that it was not listed on a national securities exchange. Per the terms of the Recapitalization, on January 18, 2022, each share of our Class B common stock automatically converted into one share of our listed common stock.
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.
Underwritten IPO—On July 19, 2021, we completed an underwritten IPO and issued 17.0 million shares of common stock at an offering price to the public of $28.00 per share. We used a portion of the net proceeds to reduce our leverage and used the remaining amount to fund external growth with property acquisitions and for other general corporate uses. As part of the underwritten IPO, underwriters were granted an option exercisable within 30 days from July 14, 2021 to purchase up to an additional 2.6 million shares of common stock at the underwritten IPO price, less underwriting discounts and commissions. On July 29, 2021, the underwriters exercised their option. The underwritten IPO, including the underwriters’ overallotment election, resulted in gross proceeds of $547.4 million.
Distributions—Distributions paid to stockholders and OP unit holders of record subsequent to March 31, 2022 were as follows (dollars in thousands, excluding per share amounts):
MonthDate of RecordDate Distribution PaidMonthly Distribution RateCash Distribution
March3/15/20224/1/2022$0.09 $11,520 
April 4/15/20225/2/20220.09 11,520 
On May 4, 2022, our Board authorized 2022 distributions for May, June, and July of $0.09 per share to the stockholders of record at the close of business on May 16, 2022, June 15, 2022, and July 15, 2022, respectively. OP unit holders will receive distributions at the same rate as common stockholders, subject to certain withholdings.
Convertible Noncontrolling Interests—As of March 31, 2022 and December 31, 2021, we had approximately 14.5 million and 13.4 million outstanding OP units, respectively. Additionally, certain of our outstanding restricted share and performance share awards will result in the issuance of OP units upon vesting in future periods.
Under the terms of the Fourth Amended and Restated Agreement of Limited Partnership, OP unit holders may elect to cause the Operating Partnership to redeem their OP units. The Operating Partnership controls the form of the redemption, and may elect to redeem OP units for shares of our common stock, provided that the OP units have been outstanding for at least one year, or for cash. As the form of redemption for OP units is within our control, the OP units outstanding as of March 31, 2022 and December 31, 2021 are classified as Noncontrolling Interests within permanent equity on our consolidated balance sheets.
On January 18, 2022, we issued approximately 1.6 million OP units in full settlement of the earn-out liability (see note 12).
The table below is a summary of our OP unit activity for the three months ended March 31, 2022 and 2021 (dollars and shares in thousands):
Three Months Ended March 31,
20222021
OP units converted into shares of common stock(1)
533  
Distributions paid on OP units(2)
$4,104 $3,319 
(1)Prior to the Recapitalization, OP units were converted to shares of common stock at a 1:1 ratio. From the Recapitalization through January 18, 2022, OP units were converted into shares of our Class B common stock at a 1:1 ratio. On January 18, 2022, each share of our Class B common stock automatically converted into one share of our listed common stock, and going forward, OP units will be converted into shares of our common stock at a 1:1 ratio.
(2)Distributions paid on OP units are included in Distributions to Noncontrolling Interests on the consolidated statements of equity and cash flows.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
13


Estimated Value per Share—Prior to our underwritten IPO, on April 29, 2021, our Board increased the estimated value per share (“EVPS”) of our common stock to $31.65 from $26.25 based substantially on the estimated market value of our portfolio of real estate properties and our third-party investment management business as of March 31, 2021. We engaged a third-party valuation firm to provide a calculation of the range in EVPS of our common stock as of March 31, 2021, which reflected certain balance sheet assets and liabilities as of that date.
Dividend Reinvestment Plan and Share Repurchase Program (“SRP”)—On August 4, 2021, as a result of our underwritten IPO, our Board approved the termination of the DRIP and the SRP.

10. EARNINGS PER SHARE
Basic earnings per share (“EPS”) is computed by dividing Net Income Attributable to Stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted EPS reflects the potential dilution that could occur from share equivalent activity.
The following table provides a reconciliation of the numerator and denominator of the earnings per share calculations (in thousands, except per share amounts):
Three Months Ended March 31,
20222021
Numerator:
Net income attributable to stockholders - basic
$10,079 $103 
Net income attributable to convertible OP units(1)
1,319 14 
Net income - diluted
$11,398 $117 
Denominator:
Weighted-average shares - basic113,571 93,490 
OP units(1)
14,558 13,354 
Dilutive restricted stock awards374 151 
Adjusted weighted-average shares - diluted128,503 106,995 
Earnings per common share:
Basic and diluted income per share
$0.09 $0.00 
(1)OP units include units that are convertible into common stock or cash, at the Operating Partnership’s option. The Operating Partnership income or loss attributable to these OP units, which is included as a component of Net Income Attributable to Noncontrolling Interests on the consolidated statements of operations, has been added back in the numerator as these OP units were included in the denominator for all periods presented. OP units are allocated income on a consistent basis with the common stockholder and therefore have no dilutive impact to earnings per share of common stock.

11. RELATED PARTY TRANSACTIONS
Revenue—We have entered into agreements with the Managed Funds related to certain advisory, management, and administrative services we provide to their real estate assets in exchange for fees and reimbursement of certain expenses. Summarized below are amounts included in Fees and Management Income. The revenue includes the fees and reimbursements earned by us from the Managed Funds and other revenues that are not in the scope of ASC Topic 606, Revenue from Contracts with Customers, but that are included in this table for the purpose of disclosing all related party revenues (in thousands):
Three Months Ended March 31,
20222021
Recurring fees(1)
$1,271 $1,125 
Transactional revenue and reimbursements(2)
394 468 
Insurance premiums(3)
796 693 
Total fees and management income $2,461 $2,286 
(1)Recurring fees include asset management fees and property management fees.
(2)Transactional revenue includes items such as leasing commissions, construction management fees, and acquisition fees.
(3)Insurance premium income includes amounts for reinsurance from third parties not affiliated with us.
PHILLIPS EDISON & COMPANY
MARCH 31, 2022 FORM 10-Q
14


Tax Protection Agreement—Through our Operating Partnership, we are currently party to a tax protection agreement (the “2017 TPA”) with certain partners that contributed property to our Operating Partnership on October 4, 2017, among them certain of our executive officers, including Jeffrey S. Edison, our Chairman and Chief Executive Officer, under which the Operating Partnership has agreed to indemnify such partners for tax liabilities that could accrue to them personally related to our potential disposition of certain properties within our portfolio. The 2017 TPA will expire on October 4, 2027. On July 19, 2021, we entered into an additional tax protection agreement (the “2021 TPA”) with certain of our executive officers, including Mr. Edison. The 2021 TPA carries a term of four years and will become effective upon the expiration of the 2017 TPA. As of March 31, 2022, the potential “make-whole amount” on the estimated aggregate amount of built-in gain subject to protection under the agreements is approximately $143.3 million. The protection provided under the terms of the 2021 TPA will expire in 2031. We have not recorded any liability related to the 2017 TPA or the 2021 TPA on our consolidated balance sheets for any periods presented, nor recognized any expense since the inception of the 2017 TPA, owing to the fact that any potential liability under the agreements is controlled by us and we believe we will either (i) continue to own and operate the protected properties or (ii) be able to successfully complete tax-deferred exchanges under Section 1031 of the Internal Revenue Code of 1986, as amended (unless there is a change in applicable law) or complete other tax-efficient transactions to avoid any liability under the agreements.
Other Related Party Matters—We are the limited guarantor for up to $190 million, capped at $50 million in most instances, of debt for our NRP joint venture. As of March 31, 2022, the outstanding loan balance related to our NRP joint venture was $15.3 million. As of March 31, 2022, we were also the limited guarantor of a $175 million mortgage loan secured by GRP I properties. Our guaranty for both the NRP and GRP I debt is limited to being the non-recourse carveout guarantor and the environmental indemnitor. Further, in both cases, we are also party to an agreement with our institutional joint venture partners in which any potential liability under such guarantees will be apportioned between us and our applicable joint venture partner based on our respective ownership percentages in the applicable joint venture. We have no liability recorded on our consolidated balance sheets for either guaranty as of March 31, 2022 and December 31, 2021.

12. FAIR VALUE MEASUREMENTS
The following describes the methods we use to estimate the fair value of our financial and nonfinancial assets and liabilities: 
Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, and Accounts Payable—We consider the carrying values of these financial instruments to approximate fair value because of the short period of time between origination of the instruments and their expected realization.
Real Estate Investments—The purchase prices of the investment properties, including related lease intangible assets and liabilities, are allocated at estimated fair value based on Level 3 inputs, such as discount rates, capitalization rates, comparable sales, replacement costs, income and expense growth rates, and current market rents and allowances as determined by management.
Debt Obligations—We estimate the fair value of our revolving credit facility, term loans, secured portfolio of loans, and mortgages by discounting the future cash flows of each instrument at rates currently offered for similar debt instruments of comparable maturities by our lenders using Level 3 inputs. The discount rates used approximate current lending rates for loans or groups of loans with similar maturities and credit quality, assuming the debt is outstanding through maturity and considering the debt’s collateral (if applicable). We have utilized market information, as available, or present value techniques to estimate the amounts required to be disclosed. We estimate the fair value of our senior unsecured notes by using quoted prices in active markets, which are considered Level 1 inputs.
The following is a summary of borrowings as of March 31, 2022 and December 31, 2021 (in thousands):
March 31, 2022December 31, 2021
Recorded Principal Balance(1)
Fair Value
Recorded Principal Balance(1)
Fair Value
Revolving credit facility$46,000 $46,017 $ $ 
Term loans943,949 955,934 943,127 955,919 
Senior unsecured notes due 2031342,488 307,339 342,320 344,099 
Secured portfolio loan facilities391,732 390,898 391,612 394,356 
Mortgages(2)
152,039 157,036 214,663 221,741 
Total