Attached files
file | filename |
---|---|
8-K - FORM 8-K - BRANDYWINE REALTY TRUST | c12807e8vk.htm |
Exhibit 99.1
Media Contact:
|
Company / Investor Contact: | |||
Kaitlin Bitting Tierney Agency 215-790-4382 kbitting@tierneyagency.com |
Marge Boccuti Manager, Investor Relations 610-832-7702 marge.boccuti@bdnreit.com |
Brandywine Realty Trust Announces Fourth Quarter and Full Year 2010 Earnings
$0.33 FFO per Diluted Share for Fourth Quarter 2010; $1.34 FFO per Diluted Share for Full Year 2010
Raises 2011 FFO Guidance Range to $1.26 to $1.34 per Diluted Share
Radnor, PA, February 16, 2011 Brandywine Realty Trust (NYSE:BDN), a real estate investment trust
focused on the ownership, management and development of Class A, suburban and urban office
properties in the mid-Atlantic region and other selected markets throughout the United States,
today reported its financial and operating results for the three and twelve-month periods ended
December 31, 2010.
2010 marked another year of solid business plan execution, stated Gerard H. Sweeney, President
and Chief Executive Officer of Brandywine Realty Trust. Despite market challenges, we achieved
record leasing activity of nearly 4.2 million square feet, better than expected tenant retention
and stable operating margins. We closed $52.6 million of asset dispositions and $157.1 million of
acquisitions and investments, positioning the company for future growth. In 2010, we issued 5.7
million shares under our 15.0 million share continuous equity program and 7.1 million units in our
Three Logan Square acquisition, raising approximately $150.0 million of equity capital to further
strengthen our balance sheet and enhance our liquidity. Furthermore, based on favorable execution
of initial elements of our 2011 business plan, we are raising our FFO guidance to a range of $1.26
to $1.34 per diluted share.
Financial Highlights Fourth Quarter
| Net loss allocated to common shares totaled ($7.0 million) or ($0.05) per diluted share
in the fourth quarter of 2010 compared to ($6.1 million) or ($0.05) per diluted share in
the fourth quarter of 2009. Our weighted average diluted share count increased to 134.4
million shares in the fourth quarter of 2010 from 128.6 million shares in the fourth
quarter of 2009. |
||
| Funds from operations available to common shares and units (FFO) in the fourth quarter
of 2010 totaled $47.9 million or $0.33 per diluted share compared to $45.7 million or
$0.34 per diluted share in the fourth quarter of 2009. Our fourth quarter 2010 FFO payout
ratio was 45.5% ($0.15 common share dividend paid / $0.33 FFO per share). Our weighted
average fully diluted share/unit count for FFO calculations increased to 145.7 million
shares/units in the fourth quarter of 2010 from 132.9 million shares/units in the fourth
quarter of 2009 due primarily to our issuance in August 2010 of 7.1 million units in
connection with our Three Logan Square acquisition and 5.7 million common shares during
2010 under our continuous equity program. |
||
| In the fourth quarter of 2010, we incurred $17.2 million of revenue maintaining capital
expenditures reflecting disbursements related to several previously executed larger leases
which along with other adjustments to FFO, resulted in $26.5 million of cash available for
distribution (CAD) or $0.19 per diluted share compared to $32.6 million of CAD or $0.25
per diluted share in the fourth quarter of 2009 when we incurred $10.0 million of revenue
maintaining capital expenditures. Our fourth quarter 2010 CAD payout ratio was 78.9%
($0.15 common share dividend paid / $0.19 CAD per share). We exclude the aforementioned
units from the CAD share/unit count because they do not receive or accrue distributions
until after the one-year anniversary of the transaction. |
555 East Lancaster Avenue, Suite 100; Radnor, PA 19087 | Phone: (610) 325-5600 Fax: (610) 325-5622 |
Financial Highlights Full Year 2010
| Net loss allocated to common shares totaled ($25.6 million) or ($0.19) per diluted
share in 2010 compared to ($0.2 million) or ($0.00) per diluted share in 2009. Our
weighted average diluted share count increased to 131.7 million in 2010 from 113.3 million
in 2009 due primarily to the issuance of 40.25 million common shares in June 2009 and 5.7 million common shares
during 2010 under our continuous equity program. In 2009, we realized $23.2 million of
gains from early extinguishment of debt versus ($2.1 million) of losses which we incurred
in 2010. |
||
| FFO available to common shares and units in 2010 totaled $185.8 million or $1.34 per
diluted share compared to $213.5 million or $1.84 per diluted share in 2009 ($217.2
million or $1.87 per diluted share excluding a $3.7 million impairment charge). Our 2010
FFO payout ratio was 44.8% ($0.60 common share dividend paid / $1.34 FFO per share). Our
weighted average fully diluted share/unit count for FFO calculations increased to 139.1
million shares in 2010 from 116.1 million shares in 2009 primarily due to the
aforementioned common share and unit issuances. |
||
| For the year ended December 31, 2010, we incurred $50.5 million of revenue maintaining
capital expenditures which along with other adjustments to FFO, resulted in $122.6 million
of CAD or $0.90 per diluted share compared to $168.6 million of CAD or $1.45 per diluted
share for the year ended December 31, 2009 when we incurred $41.9 million of revenue
maintaining capital expenditures. Our 2010 CAD payout ratio was 66.7%, ($0.60 common
share dividend paid / $0.90 CAD per share). The units have been excluded from the CAD
share/unit count as noted above. |
Portfolio Highlights
| In the fourth quarter of 2010, our net operating income (NOI) excluding termination
revenues and other income items declined 4.9% on a GAAP basis and 5.1% on a cash basis for
our 227 same store properties which were 86.0% and 89.2% occupied on December 31, 2010 and
December 31, 2009, respectively. For the full year, our same store NOI declined 4.4% on a
GAAP basis and 5.1% on a cash basis. |
||
| During the fourth quarter of 2010, we commenced occupancy on 1,146,565 square feet of
total leasing activity including 682,858 square feet of renewals, 359,698 square feet of
new leases and 104,009 square feet of tenant expansions. We have an additional 549,694
square feet of executed new leasing in place scheduled to commence subsequent to December
31, 2010. For all of 2010, we commenced occupancy on 4,177,185 square feet of combined
renewals, new leases and expansions. |
||
| During the fourth quarter of 2010, we achieved an 82.1% retention rate in our core
portfolio with positive net absorption of 187,798 square feet, bringing our full year
retention rate to 65.9%. During the fourth quarter of 2010, we experienced a 1.3% decline
on our renewal rental rates and a 10.3% decline on our new lease and expansion rental
rates, both on a GAAP basis. |
||
| At December 31, 2010, our core portfolio of 232 properties comprising 25.6 million
square feet was 85.6% occupied and 87.7% leased (reflecting new leases commencing after
December 31, 2010). |
Investment Highlights
| During the fourth quarter, we closed the portfolio sale of One and Two Greentree
Center, 8000 Lincoln Drive and Lake Center IV all in southern New Jersey and the sale of
Spyglass Point in Austin, TX for aggregate proceeds of $34.4 million, bringing total 2010
sales to $52.6 million with $11.0 million of gains on sale. The net proceeds of the
fourth quarter sales were used to repay balances on our unsecured revolving credit
facility and for general corporate purposes. |
-2-
Capital Markets Highlights
| During the fourth quarter of 2010, we issued 0.4 million shares of our common stock
under our continuous equity program realizing $4.9 million of net proceeds. The net
proceeds of the issuances were used to repay balances on our unsecured revolving credit
facility and for general corporate purposes. During 2010, we issued a total of 5.7 million
shares under the 15.0 million share program raising $70.8 million of net proceeds and have
remaining authorization for the future issuance of 9.3 million shares of common stock. |
||
| During the fourth quarter of 2010, we repurchased a total of $13.7 million of our 2011
unsecured notes (our exchangeable notes due 2026 with a put date in October 2011) in a
series of open-market transactions and incurred an aggregate loss of ($0.5 million) on the
early extinguishment of debt. We funded these repurchases with draws on our unsecured
revolving credit facility and with other available corporate funds. Overall during 2010,
we repurchased $82.7 million of various unsecured note issues and incurred a ($2.2 million)
loss on the early extinguishment of debt. |
||
| During the fourth quarter, we used available corporate funds to pre-pay our Plymouth
Meeting Executive Center mortgage loan without penalty on October 1, 2010 in the amount of
$41.5 million and realized a gain of $0.1 million reflecting the elimination of the
unamortized loan premium. |
||
| At December 31, 2010, our net debt to gross assets measured 44.4%. At December 31,
2010, we had $183.0 million outstanding on our $600.0 million unsecured revolving credit
facility with $405.8 million available for use and drawdown and $16.6 million of cash and
cash equivalents on hand. |
||
| For the quarter ended December 31, 2010, we achieved a 2.4 EBITDA to interest coverage
ratio and a 7.2 ratio of net debt to annualized quarterly EBITDA based on consolidated
EBITDA excluding non-recurring items, and inclusive of our pro rata share of unconsolidated
EBITDA, interest and net debt. |
Distributions
On December 2, 2010, our Board of Trustees declared a quarterly dividend distribution of $0.15 per
common share that was paid in the first quarter on January 20, 2011 to shareholders of record as of
January 6, 2011. Our Board also declared regular quarterly dividend distributions of $0.46875 per
7.50% Series C Cumulative Redeemable Preferred Share and $0.460938 per 7.375% Series D Cumulative
Redeemable Preferred Share that were paid on January 18, 2011 to holders of record as of December
30, 2010 of the Series C and Series D Preferred Shares, respectively.
2011 Earnings and FFO Guidance
Based on current plans and assumptions and subject to the risks and uncertainties more fully
described in our Securities and Exchange Commission filings, we are revising our previously issued
guidance for full year 2011 FFO per diluted share to be in a range of $1.26 to $1.34 versus the
prior range of $1.24 to $1.34. This guidance is provided for informational purposes and is subject
to change. The following is a reconciliation of the calculation of 2011 FFO per diluted share and
earnings per diluted share:
Guidance for 2011 | Range or Value | |||||||||||
Earnings (loss) per diluted share allocated to common shareholders |
$ | (0.32 | ) | to | $ | (0.24 | ) | |||||
Plus: real estate depreciation and amortization |
1.58 | 1.58 | ||||||||||
FFO per diluted share |
$ | 1.26 | to | $ | 1.34 | |||||||
-3-
Our 2011 FFO guidance does not include income arising from sales or impairments which may be taken
in the future, and does not include any income from the sale of undepreciated real estate in
accordance with our current practice. Our 2011 earnings and FFO per diluted share each reflect
$0.07 per diluted share of
net non-cash income attributable to the first of five annual pro-rata recognitions beginning in the
third quarter of 2011 equal to 20% of the total net impact of the previously disclosed
rehabilitation tax credit financing on the 30th Street Post Office. Other key
assumptions include flat to slightly improved occupancy levels in 2011 with modest mid-year
declines, 2.5-7.5% GAAP declines in rental rates, a resulting 4.0-6.0% decline in same store NOI
(GAAP) and 147.0 million fully diluted weighted average shares.
Accounting Disclosure
On January 1, 2010, we adopted the new accounting standard for the consolidation of variable
interest entities. The new standard revises the prior guidance related to the consolidation of
variable interest entities, and among other provisions, includes a new approach for determining
which party should consolidate a variable interest entity and the frequency as to when each party
should reassess its consolidation decision. As a result of our adoption of the new standard, we
will no longer consolidate three variable interest entities that were previously consolidated in
our financial statements. The new standard was applied prospectively beginning January 1, 2010 and
accordingly, only our current year financial statements reflect this adoption.
Non-GAAP Supplemental Financial Measures
We compute our financial results in accordance with generally accepted accounting principles
(GAAP). Although FFO, NOI and CAD are non-GAAP financial measures, we believe that FFO, NOI and
CAD calculations are helpful to shareholders and potential investors and are widely recognized
measures of real estate investment trust performance. At the end of this press release, we have
provided a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP
measure.
Funds from Operations (FFO)
We compute FFO in accordance with standards established by the National Association of Real Estate
Investment Trusts (NAREIT), which may not be comparable to FFO reported by other REITs that do not
compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition
differently than us. NAREIT defines FFO as net income (loss) before non-controlling interests and
excluding gains (losses) on sales of property and extraordinary items (computed in accordance with
GAAP); plus real estate related depreciation and amortization (excluding amortization of deferred
financing costs), and after similar adjustments for unconsolidated joint ventures. Net income, the
GAAP measure that we believe to be most directly comparable to FFO, includes depreciation and
amortization expenses, gains or losses on property sales, extraordinary items and non-controlling
interests. To facilitate a clear understanding of our historical operating results, FFO should be
examined in conjunction with net income (determined in accordance with GAAP) as presented in the
financial statements included elsewhere in this release. FFO does not represent cash flow from
operating activities (determined in accordance with GAAP) and should not be considered to be an
alternative to net income (loss) (determined in accordance with GAAP) as an indication of our
financial performance or to be an alternative to cash flow from operating activities (determined in
accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available for
our cash needs, including our ability to make cash distributions to shareholders.
For information purposes, we may also provide FFO adjusted for impairment charges. Although our
calculation of FFO as adjusted differs from NAREITs definition of FFO and may not be comparable to
that of other REITs and real estate companies, we believe it provides a meaningful supplemental
measure of our operating performance because we believe that by excluding impairment charges,
shareholders and potential investors are presented with an indicator of our operating performance
that more closely achieves the objectives of the real estate industry in presenting FFO.
-4-
Net Operating Income (NOI)
NOI is a non-GAAP financial measure equal to net income available to common shareholders, the most
directly comparable GAAP financial measure, plus corporate general and administrative expense,
depreciation and amortization, interest expense, non-controlling interests and losses from early
extinguishment of debt, less interest income, development and management income, gains from
property dispositions, gains on sale from discontinued operations, gains on early extinguishment of
debt, income from discontinued operations, income from unconsolidated joint ventures and
non-controlling interests. In some cases, we also present NOI on a cash basis, which is NOI after
eliminating the effect of straight-lining of rent and deferred market intangible amortization. NOI
presented by us may not be comparable to NOI reported by other REITs that define NOI differently.
NOI should not be considered an alternative to net income as an indication of our performance, or
as an alternative to cash flow from operating activities as a measure of our liquidity or ability
to make cash distributions to shareholders.
Cash Available for Distribution (CAD)
CAD is a non-GAAP financial measure that is not intended as an alternative to cash flow from
operating activities as determined under GAAP. CAD is presented solely as a supplemental
disclosure with respect to liquidity because we believe it provides useful information regarding
our ability to fund our distributions. Because other companies do not necessarily calculate CAD
the same way as we do, our presentation of CAD may not be comparable to similarly titled measures
provided by other companies.
Revenue Maintaining Capital Expenditures
Revenue maintaining capital expenditures, a non-GAAP financial measure, are a component of our CAD
calculation and represent the portion of capital expenditures required to maintain our current
level of funds available for distribution. Revenue maintaining capital expenditures include
current tenant improvement and allowance expenditures for all tenant spaces that have been owned
for at least one year, and that were not vacant during the twelve-month period prior to the date
that the tenant improvement or allowance expenditure was approved. Revenue maintaining capital
expenditures also include other expenditures intended to maintain our current revenue base.
Accordingly, we exclude capital expenditures related to development and redevelopment projects, as
well as certain projects at our core properties that are intended to attract prospective tenants in
order to increase revenues and/or occupancy rates.
Fourth Quarter Earnings Call and Supplemental Information Package
We will host a conference call on Thursday, February 17, 2011 at 10:00 a.m. EST. The conference
call can be accessed by calling 1-800-683-1525 and referencing conference ID #26884699. Beginning
two hours after the conference call, a taped replay of the call can be accessed 24 hours a day
through Thursday, March 3, 2011 by calling 1-800-642-1687 and providing access code 26884699. In
addition, the conference call can be accessed via a webcast located on our website at
www.brandywinerealty.com.
We have prepared a supplemental information package that includes financial results and operational
statistics related to the fourth quarter earnings report. The supplemental information package is
available in the Investor Relations Financial Reports section of our website at
www.brandywinerealty.com.
Looking Ahead First Quarter 2011 Conference Call
We anticipate we will release our first quarter 2011 earnings on Wednesday, April 27, 2011, after
the market close and will host our first quarter 2011 conference call on Thursday, April 28, 2011,
at 9:00 a.m. EDT. We expect to issue a press release in advance of these events to reconfirm the
dates and times and provide all related information.
-5-
About Brandywine Realty Trust
Brandywine Realty Trust is one of the largest, publicly traded, full-service, integrated real
estate companies in the United States. Organized as a real estate investment trust and operating
in select markets, Brandywine owns, develops, manages and has ownership interests in a primarily
Class A, suburban and urban office portfolio comprising 314 properties and 36.0 million square
feet, including 233 properties and
25.6 million square feet owned on a consolidated basis and 51 properties and 6.5 million square
feet in 17 unconsolidated real estate ventures. For more information, please visit
www.brandywinerealty.com.
Forward-Looking Statements
Estimates of future earnings per share, FFO per share, common share dividend distributions and
certain other statements in this release constitute forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors that may cause our and our affiliates
actual results, performance, achievements or transactions to be materially different from any
future results, performance, achievements or transactions expressed or implied by such
forward-looking statements. Such risks, uncertainties and other factors relate to, among others:
our ability to lease vacant space and to renew or relet space under expiring leases at expected
levels; competition with other real estate companies for tenants; the potential loss or bankruptcy
of major tenants; interest rate levels; the availability of debt, equity or other financing; risks
of acquisitions, dispositions and developments, including the cost of construction delays and cost
overruns; unanticipated operating and capital costs; our ability to obtain adequate insurance,
including coverage for terrorist acts; dependence upon certain geographic markets; and general and
local economic and real estate conditions, including the extent and duration of adverse changes
that affect the industries in which our tenants operate. Additional information on factors which
could impact us and the forward-looking statements contained herein are included in our filings
with the Securities and Exchange Commission, including our Form 10-K for the year ended December
31, 2009. We expect to file our Form 10-K for the year ended December 31, 2010 on or before March
1, 2011. We assume no obligation to update or supplement forward-looking statements that become
untrue because of subsequent events except as required by law.
-6-
BRANDYWINE REALTY TRUST
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
December 31, | December 31, | |||||||
2010 | 2009 | |||||||
ASSETS |
||||||||
Real estate investments: |
||||||||
Operating properties |
$ | 4,834,111 | $ | 4,512,618 | ||||
Accumulated depreciation |
(776,078 | ) | (716,956 | ) | ||||
4,058,033 | 3,795,662 | |||||||
Construction-in-progress |
33,322 | 271,962 | ||||||
Land inventory |
110,055 | 97,368 | ||||||
4,201,410 | 4,164,992 | |||||||
Cash and cash equivalents |
16,565 | 1,567 | ||||||
Accounts receivable, net |
16,009 | 10,934 | ||||||
Accrued rent receivable, net |
95,541 | 87,173 | ||||||
Investment in real estate ventures |
84,372 | 75,458 | ||||||
Deferred costs, net |
106,117 | 106,097 | ||||||
Intangible assets, net |
97,462 | 105,163 | ||||||
Notes receivable |
18,205 | 59,008 | ||||||
Other assets |
54,697 | 53,358 | ||||||
Total assets |
$ | 4,690,378 | $ | 4,663,750 | ||||
LIABILITIES AND EQUITY |
||||||||
Mortgage notes payable, including premiums |
$ | 711,789 | $ | 551,720 | ||||
Borrowings under credit facilities |
183,000 | 92,000 | ||||||
Unsecured term loan |
183,000 | 183,000 | ||||||
Unsecured senior notes, net of discounts |
1,352,657 | 1,627,857 | ||||||
Accounts payable and accrued expenses |
72,235 | 88,599 | ||||||
Distributions payable |
22,623 | 21,799 | ||||||
Deferred income, gains and rent (1) |
121,552 | 103,367 | ||||||
Acquired lease intangibles, net |
29,233 | 37,087 | ||||||
Other liabilities (1) |
36,515 | 36,581 | ||||||
Total liabilities |
2,712,604 | 2,742,010 | ||||||
Brandywine Realty Trusts equity: |
||||||||
Preferred shares Series C |
20 | 20 | ||||||
Preferred shares Series D |
23 | 23 | ||||||
Common shares |
1,343 | 1,286 | ||||||
Additional paid-in capital |
2,671,217 | 2,610,421 | ||||||
Deferred compensation payable in common stock |
5,774 | 5,549 | ||||||
Common shares in treasury |
(3,074 | ) | (7,205 | ) | ||||
Common shares held in grantor trust |
(5,774 | ) | (5,549 | ) | ||||
Cumulative earnings |
483,439 | 501,384 | ||||||
Accumulated other comprehensive loss |
(1,945 | ) | (9,138 | ) | ||||
Cumulative distributions |
(1,301,521 | ) | (1,213,359 | ) | ||||
Total Brandywine Realty
Trusts equity |
1,849,502 | 1,883,432 | ||||||
Non-controlling interests |
128,272 | 38,308 | ||||||
Total equity |
1,977,774 | 1,921,740 | ||||||
Total liabilities and equity |
$ | 4,690,378 | $ | 4,663,750 | ||||
(1) | As of December 31, 2010, the Company is presenting all deferred income, gains, and rents that
will be amortized to revenue as a separate line item in the consolidated balance sheets and all
liabilities that are expected to be cash settled including security deposits as other liabilities.
Accordingly, the prior year consolidated balance sheet was restated to conform to the current year
presentation. |
-7-
BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share data)
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share data)
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||
2010 | 2009 | 2010 | 2009 | ||||||||||||||
Revenue |
|||||||||||||||||
Rents |
$ | 121,695 | $ | 117,452 | $ | 466,199 | $ | 472,770 | |||||||||
Tenant reimbursements |
20,713 | 22,460 | 78,774 | 78,197 | |||||||||||||
Termination fees |
1,642 | 761 | 5,766 | 3,601 | |||||||||||||
Third party management fees, labor reimbursement and leasing |
2,537 | 3,096 | 11,830 | 17,151 | |||||||||||||
Other |
1,157 | 1,119 | 4,328 | 3,339 | |||||||||||||
Total revenue |
147,744 | 144,888 | 566,897 | 575,058 | |||||||||||||
Operating Expenses |
|||||||||||||||||
Property operating expenses |
45,533 | 44,524 | 170,151 | 165,171 | |||||||||||||
Real estate taxes |
14,073 | 14,869 | 54,444 | 57,093 | |||||||||||||
Third party management expenses |
1,433 | 1,657 | 5,866 | 7,996 | |||||||||||||
Depreciation and amortization |
57,611 | 52,164 | 212,775 | 205,863 | |||||||||||||
General & administrative expenses |
4,808 | 5,330 | 23,306 | 20,821 | |||||||||||||
Total operating expenses |
123,458 | 118,544 | 466,542 | 456,944 | |||||||||||||
Operating income |
24,286 | 26,344 | 100,355 | 118,114 | |||||||||||||
Other income (expense) |
|||||||||||||||||
Interest income |
668 | 805 | 3,222 | 2,499 | |||||||||||||
Interest expense |
(35,418 | ) | (33,695 | ) | (132,640 | ) | (135,740 | ) | |||||||||
Deferred financing costs |
(1,070 | ) | (1,139 | ) | (3,770 | ) | (5,864 | ) | |||||||||
Recognized hedge activity |
| 906 | | (916 | ) | ||||||||||||
Equity in income of real estate ventures |
1,949 | 619 | 5,305 | 4,069 | |||||||||||||
(Loss) gain on early extinguishment of debt |
(409 | ) | (548 | ) | (2,110 | ) | 23,177 | ||||||||||
(Loss) income from continuing operations |
(9,994 | ) | (6,708 | ) | (29,638 | ) | 5,340 | ||||||||||
Discontinued operations: |
|||||||||||||||||
Income from discontinued operations |
338 | 306 | 1,021 | 5,212 | |||||||||||||
Net gain on disposition of discontinued operations |
4,665 | 2,275 | 11,011 | 1,238 | |||||||||||||
Provision for impairment |
| | | (3,700 | ) | ||||||||||||
Total discontinued operations |
5,003 | 2,581 | 12,032 | 2,750 | |||||||||||||
Net (loss) income |
(4,991 | ) | (4,127 | ) | (17,606 | ) | 8,089 | ||||||||||
Net loss (income) from discontinued operations attributable
to non-controlling interests LP units |
(103 | ) | (55 | ) | (255 | ) | (45 | ) | |||||||||
Net income attributable to non-controlling interests partners share
of consolidated real estate ventures |
| 39 | | (30 | ) | ||||||||||||
Net loss (income) attributable to non-controlling interests LP units |
246 | 186 | 787 | 12 | |||||||||||||
Net loss (income) attributable to non-controlling interests |
143 | 170 | 532 | (63 | ) | ||||||||||||
Net (loss) income attributable to Brandywine Realty Trust |
(4,848 | ) | (3,957 | ) | (17,074 | ) | 8,026 | ||||||||||
Preferred share dividends |
(1,998 | ) | (1,998 | ) | (7,992 | ) | (7,992 | ) | |||||||||
Amount allocated to unvested restricted shareholders |
(128 | ) | (96 | ) | (512 | ) | (279 | ) | |||||||||
Net (loss) income attributable to Common Shareholders |
$ | (6,974 | ) | $ | (6,051 | ) | $ | (25,578 | ) | $ | (245 | ) | |||||
PER SHARE DATA |
|||||||||||||||||
Basic (loss) earnings per Common Share |
$ | (0.05 | ) | $ | (0.05 | ) | $ | (0.19 | ) | $ | (0.00 | ) | |||||
Basic weighted-average shares outstanding |
134,419,553 | 128,588,242 | 131,743,275 | 111,898,045 | |||||||||||||
Diluted (loss) earnings per Common Share |
$ | (0.05 | ) | $ | (0.05 | ) | $ | (0.19 | ) | $ | (0.00 | ) | |||||
Diluted weighted-average shares outstanding |
134,419,553 | 128,588,242 | 131,743,275 | 113,251,291 |
-8-
BRANDYWINE REALTY TRUST
FUNDS FROM OPERATIONS AND CASH AVAILABLE FOR DISTRIBUTION
(unaudited, in thousands, except share and per share data)
FUNDS FROM OPERATIONS AND CASH AVAILABLE FOR DISTRIBUTION
(unaudited, in thousands, except share and per share data)
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||
2010 | 2009 | 2010 | 2009 | ||||||||||||||
Reconciliation of Net (Loss) Income to Funds from Operations: |
|||||||||||||||||
Net (loss) income attributable to common shareholders |
$ | (6,974 | ) | $ | (6,051 | ) | $ | (25,578 | ) | $ | (245 | ) | |||||
Add (deduct): |
|||||||||||||||||
Net (loss) income attributable to non-controlling interests LP units |
(246 | ) | (186 | ) | (787 | ) | (12 | ) | |||||||||
Amount allocated to unvested restricted shareholders |
128 | 96 | 512 | 279 | |||||||||||||
Net income (loss) from discontinued operations attributable to non-controlling interests LP units |
103 | 55 | 255 | 45 | |||||||||||||
Net loss (gain) on disposition of discontinued operations |
(4,665 | ) | (2,275 | ) | (11,011 | ) | (1,238 | ) | |||||||||
Depreciation and amortization: |
|||||||||||||||||
Real property continuing operations |
43,016 | 39,799 | 160,342 | 154,292 | |||||||||||||
Leasing costs (includes acquired intangibles) continuing operations |
14,351 | 12,016 | 51,224 | 49,836 | |||||||||||||
Real property discontinued operations |
183 | 460 | 1,620 | 4,012 | |||||||||||||
Leasing costs (includes acquired intangibles) discontinued operations |
32 | 111 | 382 | 870 | |||||||||||||
Companys share of unconsolidated real estate ventures |
2,305 | 2,110 | 10,038 | 7,734 | |||||||||||||
Partners share of consolidated real estate ventures |
| (257 | ) | | (881 | ) | |||||||||||
Funds from operations |
$ | 48,234 | $ | 45,878 | $ | 186,998 | $ | 214,693 | |||||||||
Funds from operations allocable to unvested restricted shareholders |
(303 | ) | (228 | ) | (1,200 | ) | (1,180 | ) | |||||||||
Funds from operations available to common share and unit holders (FFO) |
$ | 47,931 | $ | 45,650 | $ | 185,798 | $ | 213,513 | |||||||||
FFO per share fully diluted |
$ | 0.33 | $ | 0.34 | $ | 1.34 | $ | 1.84 | |||||||||
FFO, excluding provision for impairments |
$ | 47,931 | $ | 45,650 | $ | 185,798 | $ | 217,213 | |||||||||
FFO per share, excluding provision for impairments fully diluted |
$ | 0.33 | $ | 0.34 | $ | 1.34 | $ | 1.87 | |||||||||
Weighted-average shares/units outstanding fully diluted |
145,705,703 | 132,941,173 | 139,127,071 | 116,067,459 | |||||||||||||
Distributions paid per Common Share |
$ | 0.15 | $ | 0.10 | $ | 0.60 | $ | 0.60 | |||||||||
Payout ratio of FFO (Dividends paid per Common Share divided / FFO per Diluted Share) |
45.5 | % | 29.4 | % | 44.8 | % | 32.6 | % | |||||||||
Payout ratio of FFO, excluding provision for impairments |
45.5 | % | 29.4 | % | 44.8 | % | 32.1 | % | |||||||||
CASH AVAILABLE FOR DISTRIBUTION (CAD): |
|||||||||||||||||
Funds from operations available to common share and unit holders |
$ | 47,931 | $ | 45,650 | $ | 185,798 | $ | 213,513 | |||||||||
Add (deduct): |
|||||||||||||||||
Rental income from straight-line rent, including discontinued operations |
(4,526 | ) | (2,338 | ) | (13,705 | ) | (9,375 | ) | |||||||||
Deferred market rental income, including discontinued operations |
(1,457 | ) | (1,834 | ) | (5,992 | ) | (6,851 | ) | |||||||||
Companys share of unconsolidated real estate ventures straight-line and deferred market rent |
87 | 155 | 493 | 569 | |||||||||||||
Partners share of consolidated real estate ventures straight-line and deferred market rent |
| (3 | ) | | (8 | ) | |||||||||||
Operating expense from straight-line rent |
475 | 370 | 1,647 | 1,473 | |||||||||||||
Provision for impairment of discontinued operations |
| | | 3,700 | |||||||||||||
Stock-based compensation costs |
1,061 | 1,159 | 4,816 | 4,726 | |||||||||||||
Fair market value amortization mortgage notes payable |
(243 | ) | (353 | ) | (1,480 | ) | (1,504 | ) | |||||||||
Recognized hedge activity |
| (906 | ) | | 916 | ||||||||||||
Debt discount amortization exchangeable notes |
310 | 725 | 1,593 | 3,357 | |||||||||||||
Sub-total certain non-cash items |
(4,293 | ) | (3,025 | ) | (12,628 | ) | (2,997 | ) | |||||||||
Less: Revenue maintaining capital expenditures: |
|||||||||||||||||
Building improvements |
(2,041 | ) | (1,684 | ) | (4,532 | ) | (5,976 | ) | |||||||||
Tenant improvements |
(10,502 | ) | (6,349 | ) | (29,065 | ) | (23,305 | ) | |||||||||
Lease commissions |
(4,639 | ) | (1,994 | ) | (16,944 | ) | (12,649 | ) | |||||||||
Total revenue maintaining capital expenditures |
(17,182 | ) | (10,027 | ) | (50,541 | ) | (41,930 | ) | |||||||||
Cash available for distribution |
$ | 26,456 | $ | 32,598 | $ | 122,629 | $ | 168,586 | |||||||||
CAD per share fully diluted |
$ | 0.19 | $ | 0.25 | $ | 0.90 | $ | 1.45 | |||||||||
Weighted-average shares/units outstanding fully diluted |
145,705,703 | 132,941,173 | 139,127,071 | 116,067,459 | |||||||||||||
Excluding 7,111,112 of partnership units issued not currently entitled to distributions |
(7,111,112 | ) | | (2,902,892 | ) | | |||||||||||
Adjusted Weighted-average shares/units outstanding fully diluted |
138,594,591 | 132,941,173 | 136,224,179 | 116,067,459 | |||||||||||||
Distributions per Common Share |
$ | 0.15 | $ | 0.10 | $ | 0.60 | $ | 0.60 | |||||||||
Payout ratio of CAD (Dividends paid per Common Share / CAD per Diluted Share) |
78.9 | % | 40.0 | % | 66.7 | % | 41.4 | % |
-9-
BRANDYWINE REALTY TRUST
SAME STORE OPERATIONS 4TH QUARTER
(unaudited and in thousands)
SAME STORE OPERATIONS 4TH QUARTER
(unaudited and in thousands)
Of the 233 properties owned by the Company as of December 31, 2010, a total of 227 properties
(Same Store Properties) containing an aggregate of 22.7 million net rentable square feet were
owned for the entire three-month periods ended December 31, 2010 and 2009. Average occupancy for
the Same Store Properties was 85.8% during 2010 and 88.5% during 2009. The following table sets
forth revenue and expense information for the Same Store Properties:
Three Months Ended December 31, | ||||||||
2010 | 2009 | |||||||
Revenue |
||||||||
Rents |
$ | 110,044 | $ | 114,539 | ||||
Tenant reimbursements |
18,540 | 21,479 | ||||||
Termination fees |
1,660 | 761 | ||||||
Other |
1,072 | 790 | ||||||
131,316 | 137,569 | |||||||
Operating expenses |
||||||||
Property operating expenses |
43,217 | 45,371 | ||||||
Real estate taxes |
12,694 | 14,229 | ||||||
Net operating income |
$ | 75,405 | $ | 77,969 | ||||
Net operating income percentage change over prior year |
-3.3 | % | ||||||
Net operating income, excluding termination fees & other |
$ | 72,673 | $ | 76,418 | ||||
Net operating income, excluding termination fees & other percentage change over prior year |
-4.9 | % | ||||||
Net operating income |
$ | 75,405 | $ | 77,969 | ||||
Straight line rents |
(2,703 | ) | (2,258 | ) | ||||
Above/below market rent amortization |
(1,356 | ) | (1,704 | ) | ||||
Non-cash ground rent |
475 | 370 | ||||||
Cash Net operating income |
$ | 71,821 | $ | 74,377 | ||||
Cash Net operating income percentage change over prior year |
-3.4 | % | ||||||
Cash Net operating income, excluding termination fees & other |
$ | 69,089 | $ | 72,826 | ||||
Cash Net operating income, excluding termination fees & other percentage change over prior year |
-5.1 | % |
The following table is a reconciliation of Net Income to Same Store net operating income:
Three Months Ended December 31, | ||||||||
2010 | 2009 | |||||||
Net loss |
$ | (4,991 | ) | $ | (4,127 | ) | ||
Add/(deduct): |
||||||||
Interest income |
(668 | ) | (805 | ) | ||||
Interest expense |
35,418 | 33,695 | ||||||
Deferred financing costs |
1,070 | 1,139 | ||||||
Recognized hedge activity |
| (906 | ) | |||||
Equity in income of real estate ventures |
(1,949 | ) | (619 | ) | ||||
Depreciation and amortization |
57,611 | 52,164 | ||||||
Loss (gain) on early extinguishment of debt |
409 | 548 | ||||||
General & administrative expenses |
4,808 | 5,330 | ||||||
Total discontinued operations |
(5,003 | ) | (2,581 | ) | ||||
Consolidated net operating income |
86,705 | 83,838 | ||||||
Less: Net operating income of non same store properties |
(8,420 | ) | (888 | ) | ||||
Less: Eliminations and non-property specific net operating income |
(2,880 | ) | (4,981 | ) | ||||
Same Store net operating income |
$ | 75,405 | $ | 77,969 | ||||
-10-
BRANDYWINE REALTY TRUST
SAME STORE OPERATIONS YEAR
(unaudited and in thousands)
SAME STORE OPERATIONS YEAR
(unaudited and in thousands)
Of the 233 properties owned by the Company as of December 31, 2010, a total of 223 properties
(Same Store Properties) containing an aggregate of 22.3 million net rentable square feet were
owned for the entire twelve month periods ended December 31, 2010 and 2009. Average occupancy for
the Same Store Properties was 87.6% during 2010 and 89.3% during 2009. The following table sets
forth revenue and expense information for the Same Store Properties:
Twelve Months Ended December 31, | ||||||||
2010 | 2009 | |||||||
Revenue |
||||||||
Rents |
$ | 441,956 | $ | 453,918 | ||||
Tenant reimbursements |
72,762 | 74,023 | ||||||
Termination fees |
5,553 | 2,387 | ||||||
Other |
2,555 | 1,913 | ||||||
522,826 | 532,241 | |||||||
Operating expenses |
||||||||
Property operating expenses |
165,283 | 160,917 | ||||||
Real estate taxes |
50,189 | 54,074 | ||||||
Net operating income |
$ | 307,354 | $ | 317,250 | ||||
Net operating income percentage change over prior year |
-3.1 | % | ||||||
Net operating income, excluding termination fees & other |
$ | 299,246 | $ | 312,950 | ||||
Net operating income, excluding termination fees & other percentage change over prior year |
-4.4 | % | ||||||
Net operating income |
$ | 307,354 | $ | 317,250 | ||||
Straight line rents |
(10,595 | ) | (7,995 | ) | ||||
Above/below market rent amortization |
(5,574 | ) | (6,542 | ) | ||||
Non-cash ground rent |
1,647 | 1,473 | ||||||
Cash Net operating income |
$ | 292,832 | $ | 304,186 | ||||
Cash Net operating income percentage change over prior year |
-3.7 | % | ||||||
Cash Net operating income, excluding termination fees & other |
$ | 284,724 | $ | 299,886 | ||||
Cash Net operating income, excluding termination fees & other percentage change over prior year |
-5.1 | % |
The following table is a reconciliation of Net Income to Same Store net operating income:
Twelve Months Ended December 31, | ||||||||
2010 | 2009 | |||||||
Net (loss) income |
$ | (17,606 | ) | $ | 8,089 | |||
Add/(deduct): |
||||||||
Interest income |
(3,222 | ) | (2,499 | ) | ||||
Interest expense |
132,640 | 135,740 | ||||||
Deferred financing costs |
3,770 | 5,864 | ||||||
Recognized hedge activity |
| 916 | ||||||
Equity in income of real estate ventures |
(5,305 | ) | (4,069 | ) | ||||
Depreciation and amortization |
212,775 | 205,863 | ||||||
Loss (gain) on early extinguishment of debt |
2,110 | (23,177 | ) | |||||
General & administrative expenses |
23,306 | 20,821 | ||||||
Total discontinued operations |
(12,032 | ) | (2,750 | ) | ||||
Consolidated net operating income |
336,436 | 344,798 | ||||||
Less: Net operating income of non same store properties |
(16,793 | ) | (8,760 | ) | ||||
Less: Eliminations and non-property specific net operating income (loss) |
(12,289 | ) | (18,788 | ) | ||||
Same Store net operating income |
$ | 307,354 | $ | 317,250 | ||||
-11-