Office Properties Income Trust Announces Second Quarter 2020 Results

Second Quarter Net Income of $1.3 Million, or $0.03 Per Share

Second Quarter Normalized FFO of $67.2 Million, or $1.40 Per Share

Second Quarter CAD of $45.5 Million, or $0.95 Per Share

Second Quarter Same Property Cash Basis NOI Increased 2.5%

Completed 642,000 Square Feet of Leasing in the Second Quarter for a 3.9% Roll-Up in Rents

NEWTON, Mass.–(BUSINESS WIRE)–Office Properties Income Trust (Nasdaq: OPI) today announced its financial results for the quarter and six months ended June 30, 2020.

David Blackman, President and Chief Executive Officer of OPI, made the following statement:

OPI delivered solid results for the 2020 second quarter, exceeding consensus estimates and our expectations. Highlights include completing 642,000 square feet of leasing with a 3.9% roll-up in rents for a weighted average lease term of more than six years, a year over year increase in same property cash basis NOI of 2.5%, a CAD dividend payout ratio of 57.9% and continued strong collection of cash rents. To date, we have granted only $2.5 million of deferrals to 23 tenants for the months of April through September, which represents only 88 basis points of contractual rents over that period. We also issued an aggregate of $162 million of 30 year senior unsecured notes in June and July and, in July, we entered an agreement to sell a four property business park for $25.4 million and an agreement to purchase an office property for $38.1 million under our capital recycling program. All of this is against the back drop of a strained economy from the COVID-19 pandemic. However, the successful completion of OPI’s $1 billion disposition program in 2019, our relatively low leveraged balance sheet and diverse portfolio of high quality tenants better positions OPI to weather these difficult economic conditions.

As a result, we remain optimistic that our business will continue to perform well throughout the remainder of 2020.”

Results for the Quarter Ended June 30, 2020:

Net income for the quarter ended June 30, 2020 was $1.3 million, or $0.03 per diluted share, compared to a net loss of $64.8 million, or $1.35 per diluted share, for the quarter ended June 30, 2019. Net income for the quarter ended June 30, 2020 includes a $0.6 million, or $0.01 per diluted share, loss on early extinguishment of debt. Net loss for the quarter ended June 30, 2019 includes a $66.1 million, or $1.38 per diluted share, unrealized loss on equity securities related to OPI’s former investment in The RMR Group Inc., or RMR Inc., which OPI sold on July 1, 2019, and a $2.4 million, or $0.05 per diluted share, loss on impairment of real estate, partially offset by certain net revenue events recorded during the quarter ended June 30, 2019 totaling $8.2 million, or $0.17 per diluted share, including a $7.4 million early termination fee related to a single tenant property located in San Jose, CA. The weighted average number of diluted common shares outstanding was 48.1 million for the quarter ended June 30, 2020 and 48.0 million for the quarter ended June 30, 2019.

Normalized funds from operations, or Normalized FFO, and cash available for distribution, or CAD, for the quarter ended June 30, 2020 were $67.2 million, or $1.40 per diluted share, and $45.5 million, or $0.95 per diluted share, respectively, compared to Normalized FFO and CAD for the quarter ended June 30, 2019 of $79.3 million, or $1.65 per diluted share, and $56.7 million, or $1.18 per diluted share, respectively.

Reconciliations of net income (loss) determined in accordance with U.S. generally accepted accounting principles, or GAAP, to funds from operations, or FFO, Normalized FFO and CAD for the quarters ended June 30, 2020 and 2019 appear later in this press release.

Results for the Six Months Ended June 30, 2020:

Net income for the six months ended June 30, 2020 was $12.1 million, or $0.25 per diluted share, compared to a net loss of $30.8 million, or $0.64 per diluted share, for the six months ended June 30, 2019. Net income for the six months ended June 30, 2020 includes a $10.8 million, or $0.22 per diluted share, gain on sale of real estate, partially offset by a $3.8 million, or $0.08 per diluted share, loss on early extinguishment of debt. Net loss for the six months ended June 30, 2019 includes a $44.0 million, or $0.92 per diluted share, unrealized loss on equity securities related to OPI’s former investment in RMR Inc., which OPI sold on July 1, 2019, and a $5.6 million, or $0.12 per diluted share, loss on impairment of real estate, partially offset by a $22.1 million, or $0.46 per diluted share, net gain on sale of real estate and certain net revenue events totaling $8.2 million, or $0.17 per diluted share, including a $7.4 million early termination fee related to a single tenant property located in San Jose, CA. The weighted average number of diluted common shares outstanding was 48.1 million for the six months ended June 30, 2020 and 48.0 million for the six months ended June 30, 2019.

Normalized FFO and CAD for the six months ended June 30, 2020 were $134.7 million, or $2.80 per diluted share, and $92.9 million, or $1.93 per diluted share, respectively, compared to Normalized FFO and CAD for the six months ended June 30, 2019 of $152.5 million, or $3.17 per diluted share, and $110.2 million, or $2.29 per diluted share, respectively.

Reconciliations of net income (loss) determined in accordance with GAAP to FFO, Normalized FFO and CAD for the six months ended June 30, 2020 and 2019 appear later in this press release.

Leasing, Occupancy and Same Property Results:

During the quarter ended June 30, 2020, OPI entered new and renewal leases for an aggregate of 642,000 rentable square feet at weighted (by rentable square feet) average rents that were 3.9% above prior rents for the same space. The weighted (by rentable square feet) average lease term for these leases was approximately 6.1 years and leasing concessions and capital commitments were $16.5 million, or $4.25 per square foot, per lease year.

As of June 30, 2020, 91.7% of OPI’s total rentable square feet was leased, compared to 91.5% as of March 31, 2020 and 91.6% as of June 30, 2019. Occupancy for properties owned continuously since April 1, 2019, or same properties, was 92.8% as of June 30, 2020, compared to 92.6% as of March 31, 2020 and 93.4% as of June 30, 2019. Same property cash basis net operating income, or Cash Basis NOI, increased 2.5% for the quarter ended June 30, 2020 compared to the quarter ended June 30, 2019. The increase in same property Cash Basis NOI is due to an increase in cash received from contractual rents of $1.1 million, which is primarily the result of free rent expiring and decreases in operating expenses, including approximately $1.7 million of expense savings as a result of cost savings initiatives in response to the COVID-19 pandemic.

Reconciliations of net income (loss) determined in accordance with GAAP to net operating income, or NOI, and Cash Basis NOI, and a reconciliation of NOI to same property NOI and same property Cash Basis NOI, for the quarters ended June 30, 2020 and 2019, appear later in this press release.

As a result of the COVID-19 pandemic, overall new leasing volume for 2020 has slowed and may continue to slow, but OPI continues to believe that overall tenant retention levels may increase. Also as a result of the COVID-19 pandemic, OPI has granted temporary rent assistance to date totaling $2.5 million to 23 tenants, pursuant to a deferred payment plan whereby these tenants will pay, in most cases one month of rent, over a 12-month period beginning in September 2020. The $2.5 million of granted temporary rent assistance is detailed as follows:

 

 

Granted

Temporary Rent

Assistance

 

Percentage of

Monthly

Contractual Rents

April 2020

 

$

445,530

 

 

0.95

%

May 2020

 

817,495

 

 

1.74

%

June 2020

 

959,352

 

 

2.07

%

Subtotal

 

2,222,377

 

 

1.59

%

July 2020

 

134,086

 

 

0.29

%

August 2020

 

59,206

 

 

0.12

%

September 2020

 

59,206

 

 

0.12

%

Total

 

$

2,474,875

 

 

0.88

%

For the quarter ended June 30, 2020, OPI collected approximately 98% of contractual rent obligations and 99% of contractual rent obligations after giving effect to such rent deferrals.

While it is still early to assess the full impact the COVID-19 pandemic will have on OPI’s business, OPI believes it will benefit from the approximately 62.8% of annualized rental income paid by investment grade tenants, the majority of which is made up of government tenants, and the diversity of its tenant base, both geographically and by industry, which OPI believes may help mitigate the economic impact caused by the COVID-19 pandemic.

Recent Acquisition Activities:

In July 2020, OPI entered into an agreement to acquire an office property located in Denver, CO containing approximately 68,000 rentable square feet for a purchase price of $38.1 million, excluding acquisition related costs. This property is 100% leased to a single tenant and has a remaining lease term of 11.5 years. This acquisition is expected to occur before the end of the third quarter.

Recent Disposition Activities:

In July 2020, OPI entered into an agreement to sell a four property business park located in Fairfax, VA containing approximately 171,000 rentable square feet for a sales price of $25.4 million, excluding closing costs. This sale is expected to occur before the end of the third quarter.

Recent Financing Activities:

As previously announced, in April 2020, OPI prepaid, at par plus accrued interest, a mortgage note secured by one property with an outstanding principal balance of $32.7 million, an annual interest rate of 5.7% and a maturity date in July 2020 using cash on hand and borrowings under its revolving credit facility.

In June 2020, OPI issued $150.0 million of 6.375% senior unsecured notes due 2050 in an underwritten public offering, raising net proceeds of $144.8 million, after deducting underwriters’ discounts and estimated offering expenses. In connection with this offering, OPI granted the underwriters a 30 day option to purchase up to an additional $22.5 million aggregate principal amount of these notes. In July 2020, the underwriters partially exercised this option for an additional $12.0 million of these notes. OPI used the aggregate net proceeds of this offering to repay amounts outstanding under OPI’s revolving credit facility and for general business purposes.

Conference Call:

At 10:00 a.m. Eastern Time this morning, President and Chief Executive Officer, David Blackman, Chief Financial Officer and Treasurer, Matthew Brown, and Vice President and Chief Operating Officer, Christopher Bilotto, will host a conference call to discuss OPI’s second quarter 2020 financial results.

The conference call telephone number is (877) 328-1172. Participants calling from outside the United States and Canada should dial (412) 317-5418. No pass code is necessary to access the call from either number. Participants should dial in about 15 minutes prior to the scheduled start of the call. A replay of the conference call will be available through 11:59 p.m. on Thursday, August 6, 2020. To access the replay, dial (412) 317-0088. The replay pass code is 10145302.

A live audio webcast of the conference call will also be available in a listen only mode on OPI’s website, at www.opireit.com. Participants wanting to access the webcast should visit OPI’s website about five minutes before the call. The archived webcast will be available for replay on OPI’s website following the call for about one week. The transcription, recording and retransmission in any way of OPI’s second quarter conference call are strictly prohibited without the prior written consent of OPI.

Supplemental Data:

A copy of OPI’s Second Quarter 2020 Supplemental Operating and Financial Data is available for download at OPI’s website, www.opireit.com. OPI’s website is not incorporated as part of this press release.

Non-GAAP Financial Measures:

OPI presents certain “non-GAAP financial measures” within the meaning of applicable rules of the Securities and Exchange Commission, or SEC, including FFO, Normalized FFO, CAD, Property NOI, Property Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI. These measures do not represent cash generated by operating activities in accordance with GAAP and should not be considered alternatives to net income (loss) as indicators of OPI’s operating performance or as measures of OPI’s liquidity. These measures should be considered in conjunction with net income (loss) as presented in OPI’s condensed consolidated statements of income (loss). OPI considers these non-GAAP measures to be appropriate supplemental measures of operating performance for a real estate investment trust, or REIT, along with net income (loss). OPI believes these measures provide useful information to investors because by excluding the effects of certain historical amounts, such as depreciation and amortization expense, they may facilitate a comparison of OPI’s operating performance between periods and with other REITs and, in the case of Property NOI, Property Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI reflecting only those income and expense items that are generated and incurred at the property level may help both investors and management to understand the operations of OPI’s properties.

Please see the pages attached hereto for a more detailed statement of OPI’s operating results and financial condition and for an explanation of OPI’s calculation of FFO, Normalized FFO, CAD, Property NOI, Property Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI and a reconciliation of those amounts to amounts determined in accordance with GAAP.

OPI is a REIT focused on owning, operating and leasing properties primarily leased to single tenants and those with high credit quality characteristics such as government entities. OPI is managed by the operating subsidiary of The RMR Group Inc. (Nasdaq: RMR), an alternative asset management company that is headquartered in Newton, Massachusetts.

Office Properties Income Trust

Condensed Consolidated Statements of Income (Loss)

(amounts in thousands, except per share data)

(unaudited)

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2020

 

2019

 

2020

 

2019

Rental income

 

$

145,603

 

 

$

176,032

 

 

$

295,488

 

 

$

350,809

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

Real estate taxes

 

15,781

 

 

18,147

 

 

32,588

 

 

36,539

 

Utility expenses

 

5,201

 

 

7,470

 

 

12,213

 

 

16,851

 

Other operating expenses

 

25,787

 

 

29,692

 

 

51,667

 

 

59,828

 

Depreciation and amortization

 

64,170

 

 

73,913

 

 

127,113

 

 

151,434

 

Loss on impairment of real estate (1)

 

 

 

2,380

 

 

 

 

5,584

 

Acquisition and transaction related costs (2)

 

 

 

98

 

 

 

 

682

 

General and administrative

 

7,204

 

 

8,744

 

 

14,313

 

 

17,467

 

Total expenses

 

118,143

 

 

140,444

 

 

237,894

 

 

288,385

 

 

 

 

 

 

 

 

 

 

Gain (loss) on sale of real estate (3)

 

66

 

 

(17

)

 

10,822

 

 

22,075

 

Dividend income

 

 

 

980

 

 

 

 

1,960

 

Loss on equity securities (4)

 

 

 

(66,135

)

 

 

 

(44,007

)

Interest and other income

 

30

 

 

241

 

 

736

 

 

489

 

Interest expense (including net amortization of debt premiums, discounts and

issuance costs of $2,402, $2,863, $4,685 and $5,704, respectively)

 

(25,205

)

 

(35,348

)

 

(52,364

)

 

(72,481

)

Loss on early extinguishment of debt (5)

 

(557

)

 

(71

)

 

(3,839

)

 

(485

)

Income (loss) before income tax (expense) benefit and equity in net losses of investees

 

1,794

 

 

(64,762

)

 

12,949

 

 

(30,025

)

Income tax (expense) benefit

 

(235

)

 

130

 

 

(274

)

 

(353

)

Equity in net losses of investees

 

(260

)

 

(142

)

 

(536

)

 

(377

)

Net income (loss)

 

$

1,299

 

 

$

(64,774

)

 

$

12,139

 

 

$

(30,755

)

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding (basic and diluted)

 

48,106

 

 

48,049

 

 

48,101

 

 

48,040

 

 

 

 

 

 

 

 

 

 

Per common share amounts (basic and diluted):

 

 

 

 

 

 

 

 

Net income (loss)

 

$

0.03

 

 

$

(1.35

)

 

$

0.25

 

 

$

(0.64

)

See Notes on pages 6 and 7.

Office Properties Income Trust

Funds from Operations, Normalized Funds from Operations and Cash Available for Distribution

(amounts in thousands, except per share data)

(unaudited)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2020

 

2019

 

2020

 

2019

Calculation of FFO, Normalized FFO and CAD (6)(7):

 

 

 

 

 

 

Net income (loss)

 

$

1,299

 

 

$

(64,774

)

 

$

12,139

 

 

$

(30,755

)

Add (less): Depreciation and amortization:

 

 

 

 

 

 

 

 

Consolidated properties

 

64,170

 

 

73,913

 

 

127,113

 

 

151,434

 

Unconsolidated joint venture properties

 

1,237

 

 

1,410

 

 

2,478

 

 

3,161

 

Loss on impairment of real estate (1)

 

 

 

2,380

 

 

 

 

5,584

 

(Gain) loss on sale of real estate (3)

 

(66

)

 

17

 

 

(10,822

)

 

(22,075

)

Loss on equity securities (4)

 

 

 

66,135

 

 

 

 

44,007

 

FFO

 

66,640

 

 

79,081

 

 

130,908

 

 

151,356

 

Add (less): Acquisition and transaction related costs (2)

 

 

 

98

 

 

 

 

682

 

Loss on early extinguishment of debt (5)

 

557

 

 

71

 

 

3,839

 

 

485

 

Normalized FFO

 

67,197

 

 

79,250

 

 

134,747

 

 

152,523

 

Add (less): Non-cash expenses (8)

 

808

 

 

695

 

 

887

 

 

1,287

 

Distributions from unconsolidated joint ventures

 

102

 

 

600

 

 

153

 

 

1,121

 

Depreciation and amortization – unconsolidated joint ventures

 

(1,237

)

 

(1,410

)

 

(2,478

)

 

(3,161

)

Equity in net losses of investees

 

260

 

 

142

 

 

536

 

 

377

 

Loss on early extinguishment of debt settled in cash

 

 

 

 

 

(1,138

)

 

 

Non-cash straight line rent adjustments included in rental income

 

(3,468

)

 

(5,667

)

 

(9,051

)

 

(12,461

)

Lease value amortization included in rental income

 

1,405

 

 

1,446

 

 

2,837

 

 

2,593

 

Net amortization of debt premiums, discounts and issuance costs

 

2,402

 

 

2,863

 

 

4,685

 

 

5,704

 

Recurring capital expenditures

 

(21,926

)

 

(21,200

)

 

(38,269

)

 

(37,745

)

CAD (7)

 

$

45,543

 

 

$

56,719

 

 

$

92,909

 

 

$

110,238

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding (basic and diluted)

 

48,106

 

48,049

 

48,101

 

48,040

 

 

 

 

 

 

 

 

 

Per common share amounts (basic and diluted):

 

 

 

 

 

 

 

 

Net income (loss)

 

$

0.03

 

 

$

(1.35

)

 

$

0.25

 

 

$

(0.64

)

FFO

 

$

1.39

 

 

$

1.65

 

 

$

2.72

 

 

$

3.15

 

Normalized FFO

 

$

1.40

 

 

$

1.65

 

 

$

2.80

 

 

$

3.17

 

CAD

 

$

0.95

 

 

$

1.18

 

 

$

1.93

 

 

$

2.29

 

Distributions declared per share

 

$

0.55

 

 

$

0.55

 

 

$

1.10

 

 

$

1.10

 

(1)

  Loss on impairment of real estate for the three months ended June 30, 2019 includes an adjustment of $2,380 to reduce the carrying value of one property to its estimated fair value less costs to sell. Loss on impairment of real estate for the six months ended June 30, 2019 also includes an adjustment of $2,757 to reduce the carrying value of one property to its estimated fair value less costs to sell and a $447 loss on impairment of real estate related to the sale of a portfolio of 34 properties during the three months ended March 31, 2019.

 

   

(2)

  Acquisition and transaction related costs for the three and six months ended June 30, 2019 consist of post-merger activity costs incurred in connection with OPI’s acquisition of Select Income REIT on December 31, 2018 in a merger transaction and other related transactions.

 

   

(3)

  Gain on sale of real estate for the six months ended June 30, 2020 represents a $10,822 net gain on the sale of six properties. Gain on sale of real estate for the six months ended June 30, 2019 represents a $22,075 gain on the sale of one property.

 

   

(4)

  Loss on equity securities for the three and six months ended June 30, 2019 represents an unrealized loss to adjust the carrying value of OPI’s former investment in RMR Inc. common stock to its fair value as of June 30, 2019. On July 1, 2019, OPI sold its investment in RMR Inc. common stock.

 

   

(5)

  Loss on early extinguishment of debt for the three and six months ended June 30, 2020 includes prepayment fees related to the repayment of two mortgage notes, write offs of the unamortized portion of certain discounts and issuance costs resulting from the early repayment of debt and a loss related to the settlement of a mortgage note receivable in connection with a property OPI sold in 2016. Loss on early extinguishment of debt for the three and six months ended June 30, 2019 includes write offs of the unamortized portion of certain discounts and issuance costs resulting from the early repayment of debt.

 

   

(6)

  OPI calculates FFO and Normalized FFO as shown above. FFO is calculated on the basis defined by The National Association of Real Estate Investment Trusts, which is net income (loss), calculated in accordance with GAAP, plus real estate depreciation and amortization of consolidated properties and its proportionate share of the real estate depreciation and amortization of unconsolidated joint venture properties, but excluding impairment charges on real estate assets, any gain or loss on sale of real estate and equity securities, as well as certain other adjustments currently not applicable to OPI. In calculating Normalized FFO, OPI adjusts for the other items shown above and includes business management incentive fees, if any, only in the fourth quarter versus the quarter when they are recognized as an expense in accordance with GAAP due to their quarterly volatility not necessarily being indicative of OPI’s core operating performance and the uncertainty as to whether any such business management incentive fees will be payable when all contingencies for determining such fees are known at the end of the calendar year. FFO and Normalized FFO are among the factors considered by OPI’s Board of Trustees when determining the amount of distributions to OPI’s shareholders. Other factors include, but are not limited to, requirements to maintain OPI’s qualification for taxation as a REIT, limitations in OPI’s credit agreement and public debt covenants, the availability to OPI of debt and equity capital, OPI’s expectation of its future capital requirements and operating performance and OPI’s expected needs for and availability of cash to pay its obligations. Other real estate companies and REITs may calculate FFO and Normalized FFO differently than OPI does.

 

   

(7)

  OPI calculates CAD as shown above. OPI defines CAD as Normalized FFO minus recurring real estate related capital expenditures and other non-cash and non-recurring items. CAD is among the factors considered by OPI’s Board of Trustees when determining the amount of distributions to its shareholders. Other real estate companies and REITs may calculate CAD differently than OPI does.

 

   

(8)

  Non-cash expenses include equity based compensation, adjustments recorded to capitalize interest expense and amortization of the liability for the amount by which the estimated fair value for accounting purposes exceeded the price OPI paid for its former investment in RMR Inc. common stock in June 2015. This liability is being amortized on a straight line basis through December 31, 2035 as an allocated reduction to business management fee expense and property management fee expense, which are included in general and administrative and other operating expenses, respectively. 

Office Properties Income Trust

Calculation and Reconciliation of Property NOI, Property Cash Basis NOI, Same Property NOI and Same Property Cash Basis NOI (1)

(amounts in thousands)

(unaudited)

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2020

 

2019

 

2020

 

2019

Calculation of Property NOI and Property Cash Basis NOI:

 

 

 

 

Rental income

 

$

145,603

 

 

$

176,032

 

 

$

295,488

 

 

$

350,809

 

Property operating expenses

 

(46,769

)

 

(55,309

)

 

(96,468

)

 

(113,218

)

Property NOI

 

98,834

 

 

120,723

 

 

199,020

 

 

237,591

 

Non-cash straight line rent adjustments included in rental income

 

(3,468

)

 

(5,667

)

 

(9,051

)

 

(12,461

)

Lease value amortization included in rental income

 

1,405

 

 

1,446

 

 

2,837

 

 

2,593

 

Lease termination fees included in rental income

 

(3

)

 

(8,867

)

 

(6

)

 

(9,161

)

Non-cash amortization included in property operating expenses (2)

 

(121

)

 

(121

)

 

(242

)

 

(242

)

Property Cash Basis NOI

 

$

96,647

 

 

$

107,514

 

 

$

192,558

 

 

$

218,320

 

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income (Loss) to Property NOI and Property Cash Basis NOI:

Net income (loss)

 

$

1,299

 

 

$

(64,774

)

 

$

12,139

 

 

$

(30,755

)

Equity in net losses of investees

 

260

 

 

142

 

 

536

 

 

377

 

Income tax expense (benefit)

 

235

 

 

(130

)

 

274

 

 

353

 

Income (loss) before income tax expense (benefit) and equity in net losses of investees

 

1,794

 

 

(64,762

)

 

12,949

 

 

(30,025

)

Loss on early extinguishment of debt

 

557

 

 

71

 

 

3,839

 

 

485

 

Interest expense

 

25,205

 

 

35,348

 

 

52,364

 

 

72,481

 

Interest and other income

 

(30

)

 

(241

)

 

(736

)

 

(489

)

Loss on equity securities

 

 

 

66,135

 

 

 

 

44,007

 

Dividend income

 

 

 

(980

)

 

 

 

(1,960

)

(Gain) loss on sale of real estate

 

(66

)

 

17

 

 

(10,822

)

 

(22,075

)

General and administrative

 

7,204

 

 

8,744

 

 

14,313

 

 

17,467

 

Acquisition and transaction related costs

 

 

 

98

 

 

 

 

682

 

Loss on impairment of real estate

 

 

 

2,380

 

 

 

 

5,584

 

Depreciation and amortization

 

64,170

 

 

73,913

 

 

127,113

 

 

151,434

 

Property NOI

 

98,834

 

 

120,723

 

 

199,020

 

 

237,591

 

Non-cash amortization included in property operating expenses (2)

 

(121

)

 

(121

)

 

(242

)

 

(242

)

Lease termination fees included in rental income

 

(3

)

 

(8,867

)

 

(6

)

 

(9,161

)

Lease value amortization included in rental income

 

1,405

 

 

1,446

 

 

2,837

 

 

2,593

 

Non-cash straight line rent adjustments included in rental income

 

(3,468

)

 

(5,667

)

 

(9,051

)

 

(12,461

)

Property Cash Basis NOI

 

$

96,647

 

 

$

107,514

 

 

$

192,558

 

 

$

218,320

 

 

 

 

 

 

 

 

 

 

Reconciliation of Property NOI to Same Property NOI (3) (4):

 

 

 

 

 

 

 

 

Rental income

 

$

145,603

 

 

$

176,032

 

 

$

295,488

 

 

$

350,809

 

Property operating expenses

 

(46,769

)

 

(55,309

)

 

(96,468

)

 

(113,218

)

Property NOI

 

98,834

 

 

120,723

 

 

199,020

 

 

237,591

 

Less: NOI of properties not included in same property results

 

552

 

 

(21,003

)

 

(268

)

 

(38,403

)

Same Property NOI

 

$

99,386

 

 

$

99,720

 

 

$

198,752

 

 

$

199,188

 

 

 

 

 

 

 

 

 

 

Calculation of Same Property Cash Basis NOI (3) (4):

 

 

 

 

 

 

 

 

Same Property NOI

 

$

99,386

 

 

$

99,720

 

 

$

198,752

 

 

$

199,188

 

Add: Lease value amortization included in rental income

 

1,405

 

 

1,559

 

 

2,837

 

 

2,813

 

Less: Non-cash straight line rent adjustments included in rental income

 

(3,470

)

 

(5,124

)

 

(8,999

)

 

(11,405

)

Lease termination fees included in rental income

 

(3

)

 

(1,225

)

 

(6

)

 

(1,519

)

Non-cash amortization included in property operating expenses (2)

 

(117

)

 

(97

)

 

(234

)

 

(193

)

Same Property Cash Basis NOI

 

$

97,201

 

 

$

94,833

 

 

$

192,350

 

 

$

188,884

 

Contacts

Olivia Snyder, Manager, Investor Relations

(617) 219-1410

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Author: dmnnewswire