NOTE 3. INCOME PROPERTIES

Leasing revenue consists of long-term rental revenue from retail, office, and commercial income properties, which is recognized as earned, using the straight-line method over the life of each lease. Lease payments below include straight-line base rental revenue as well as the non-cash accretion of above and below market lease amortization. The variable lease payments are primarily comprised of percentage rents, reimbursements from tenants for common area maintenance, insurance, real estate taxes, other operating expenses, and termination fee payments.

The components of leasing revenue are as follows (in thousands):

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Minimum future base rental receipts under non-cancelable operating leases, excluding percentage rent and other lease payments that are not fixed and determinable, having remaining terms in excess of one year subsequent to March 31, 2026, are summarized as follows (in thousands):

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2026 Acquisitions. During the three months ended March 31, 2026, the Company acquired Palms Crossing, an open-air shopping center located in McAllen, TX, for a purchase price of $81.6 million, or a total acquisition cost of $81.8 million, including capitalized acquisition costs. Palms Crossing comprises approximately 399,000 square feet, was 98% occupied at acquisition, and had a weighted average remaining lease term of 4.5 years at acquisition. Of the total acquisition costs, $9.4 million was allocated to land, $59.5 million was allocated to buildings and improvements, $16.2 million was allocated to intangible assets pertaining to the in-place lease value, leasing costs, and above market lease value and $3.3 million was allocated to intangible liabilities for the below market lease value.

2025 Acquisitions. During the three months ended March 31, 2025, the Company acquired Ashley Park, a shopping center located in Newnan, GA, for a purchase price of $79.8 million, or a total acquisition cost of $80.0 million, including capitalized acquisition costs. Ashley Park comprises approximately 559,000 square feet, was 92% occupied at acquisition, and had a weighted average remaining lease term of 4.1 years at acquisition. Of the total acquisition costs, $26.0 million was allocated to land, $40.9 million to buildings and improvements, $16.8 million to intangible assets pertaining to the in-place lease value, leasing costs, and above market lease value and $3.7 million to intangible liabilities for the below market lease value.

2026 and 2025 Dispositions. No income properties were disposed of during the three months ended March 31, 2026 or 2025, respectively.