Shares in mall owner Macerich fell by 8% in trading Tuesday after the publicly traded REIT disclosed a substantial decline in cash flow and indicated it could have to sell or hand over properties to tackle its debt obligations.

The company, which owns 47M SF of enclosed and strip malls across the country, reported a net loss of $126.7M in the first quarter, more than double its loss of $58.7M during the same period last year, according to its quarterly earnings.

Macerich's funds from operations, a key metric of cash flow for REITs, declined to $74.6M for the quarter from $95.9M in Q1 2023, a substantial decline the company partly attributed to the bankruptcy of Express Inc., which plans to close more than 100 of its 530 locations.

The company also withdrew its prior earnings guidance, citing a plan under new leadership to reduce its leverage. Former CEO Thomas O’Hern retired March 1, and former Spirit Realty Capital CEO and President Jackson Hsieh stepped into the role.

“We have already started to execute on that plan, including property sales, potentially returning assets to lenders and buying out joint venture interests on certain assets,” the company said in a press release.

During Q1, Macerich defaulted on the $300M loan backing Santa Monica Place, an outdoor shopping mall in Southern California.

It has also reworked multiple loans so far this year, including a $155M refinance on Danbury Fair Mall in Connecticut and closing a three-year extension of the $85M loan on the Fashion Outlets of Niagara Falls in New York. It is in the process of closing an extension on a $151M loan on The Oaks in California and refinancing a $256M loan on Chandler Fashion Center in Arizona, which matures in July.

The company beat expectations for revenue, reporting $208.8M, up from the $203.5M expected but down from $214.9M in Q1 2023. It was whacked with rising expenses, which clocked in at $232.1M, up from $192.9M in the prior quarter and $216.9M the year before.

Macerich has signed more than 1M SF of leases this year, a 14% increase from the same time last year. 2023 was a record year for leasing for the company, with 4.2M SF of deals signed.

The mall owner benefited from national retail vacancy falling to historic lows, as occupancy across Macerich’s portfolio reached 93.4%, up from 92.2% a year prior. Rents for space it re-leased after tenant exits was up 14%, as vacancies continue to present opportunities for landlords.

“We're putting in much more attractive merchants, much more diversified uses that will draw traffic and better sales volumes at better rent levels,” Macerich Chief Financial Officer Scott Kingsmore said on the company’s Q4 earnings call in February.