THOMAS PROPERTIES GROUP INC - FORM 8-K - EX-99.1 - SUPPLEMENTAL FINANCIAL INFORMATION FOR THE QUARTER ENDED SEPTEMBER 30, 2012

Attached files

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EX-99.2 - PRESS RELEASE - THOMAS PROPERTIES GROUP INC	exhibit992-er9302012.htm
8-K - 8-K - THOMAS PROPERTIES GROUP INC	a2012q3earningsreleasecove.htm

Exhibit 99.1

Thomas Properties Group, Inc.

Supplemental Financial Information

For the Quarter Ended September 30, 2012

Thomas Properties Group, Inc.

Supplemental Financial Information

For the Quarter Ended September 30, 2012

TABLE OF CONTENTS




Corporate
Company Background	1

Supplemental Financial Information
Operating and Financial Information	2
Consolidated Statements of Operations	3
Consolidated Balance Sheets	4
Unconsolidated Real Estate Entities Statements of Operations	5
Unconsolidated Real Estate Entities Balance Sheets	6
Pro-Rata Consolidated Statements of Operations (Non-GAAP)	7
Pro-Rata Consolidated Balance Sheets (Non-GAAP)	9
Earnings Before Depreciation, Amortization and Taxes (EBDT) (Non-GAAP)	10
After Tax Cash Flow (ATCF) (Non-GAAP)	12
Investment Advisory, Management, Leasing and Development Services	14
Portfolio Data:
Our Operating Properties	16
Same Property Net Operating Income Comparison (Non-GAAP)	19
Lease Expirations	21
Lease Activity	22
Our Development Properties	23
Our Managed Properties	24
Debt Summary	25
Capital Structure	27
Other Information	28

This supplemental financial information, together with other statements and information publicly disseminated by Thomas Properties Group, Inc., contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements reflect management’s current views with respect to financial results related to future events. Such statements are also based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial or otherwise, may differ from the results discussed in the forward-looking statements. Management does not undertake any obligation to update information provided in forward-looking statements other than regularly scheduled releases of information. A discussion of some of the factors that may affect our future results is set forth under the captions “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in our annual reports on Form 10-K and our quarterly reports on Form 10-Q, which are filed with the Securities and Exchange Commission.

Thomas Properties Group, Inc.

Supplemental Financial Information

COMPANY BACKGROUND

Thomas Properties Group, Inc. (“TPGI”) is a full-service real estate operating company that owns, acquires, develops and manages primarily office, as well as mixed-use properties on a nationwide basis. Our company’s primary areas of focus are the acquisition and ownership of interests in premier office properties, property development and redevelopment, and investment and property management activities.

Our Property Portfolio

Our properties are located in Southern California and Sacramento, California; Philadelphia, Pennsylvania; Northern Virginia; Houston, Texas; and Austin, Texas. As of September 30, 2012, we owned interests in and asset managed 18 operating properties with 10.5 million rentable square feet and provided leasing, asset and/or property management services on behalf of third parties for an additional five operating properties with 2.6 million rentable square feet.

Our Partnerships and Joint Ventures

Our sponsorship of partnerships and joint ventures provides us with institutional capital for investment as well as the opportunity to earn fees for asset management, property management, leasing and other services.

TPG/CalSTRS, LLC (“TPG/CalSTRS”) is a value-add/core-plus joint venture with the California State Teachers’ Retirement System (“CalSTRS”), which has total capital commitments of $511.7 million of which $2.9 million and $10.9 million is currently unfunded by CalSTRS and us, respectively. This joint venture, in which our operating partnership, Thomas Properties Group, L.P. (“TPG”), is the managing member, currently owns six office properties.

TPG/CalSTRS Austin, LLC is a new joint venture between TPG Austin Partner LLC and CalSTRS, in which each partner owns 50%. TPG Austin Partner LLC, the managing member, is a joint venture between our operating partnership, TPG, and Madison International Realty ("Madison"), which have ownership interests of 66.67% and 33.33%, respectively. During September 2012, TPG/CalSTRS Austin, LLC acquired the eight properties in Austin, Texas formerly owned by TPG-Austin Portfolio Syndication Partner JV LP, an entity in which TPG had a 6.25% interest. TPG's effective ownership interest in the Austin properties is 33.33%.

Estimated Net Asset Value Workbook (NAV Workbook)

Along with this Supplemental Financial Information, we are making available a Net Asset Value (NAV) Workbook to facilitate a calculation of an estimated NAV per share for TPGI. The NAV Workbook (in the form of a Microsoft Excel file) can be found on our website, www.tpgre.com, in the Supplemental Financial Information section of the Investor Relations tab. The NAV Workbook presents information from this Supplemental Financial Information, and allows the insertion of capitalization rates and multiples which are used to calculate an estimated NAV for specific portions of our business. The resulting values and a calculation of NAV per share are then summarized in the NAV Workbook.

Recent Events

Austin Portfolio Joint Venture:

In September 2012, entities owned by TPG, CalSTRS and Madison, acquired all of the equity interests in an eight building, three million square foot portfolio of office properties in Austin, Texas, formerly owned by TPG-Austin Portfolio Syndication Partner JV LP, a venture among Lehman Brothers Holdings, Inc (50%), an offshore sovereign wealth fund (25%) and TPG/CalSTRS, LLC (25%). The purchase price for the portfolio was $859.0 million. As part of the transaction, TPG/CalSTRS Austin, LLC assumed five existing first mortgage loans totaling $626.0 million. The transaction reduced the existing leverage on the portfolio by repaying approximately $200 million owed to Lehman Commercial Paper, Inc. and the three existing partners as a result of loans made by the partners. TPG retains all operating responsibilities for the properties and the existing Austin leasing and management team remains in place.

Thomas Properties Group, Inc.

Supplemental Financial Information

OPERATING AND FINANCIAL INFORMATION

Financial Measures

This supplemental financial information includes certain financial measures prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) under the full consolidation accounting method, and certain financial measures prepared in accordance with the pro-rata consolidation method (non-GAAP). We believe the financial measures presented under the pro-rata consolidation method provide supplemental information helpful to an understanding of our results of operations and financial condition. Along with net income, we use three additional measures; Earnings before Depreciation, Amortization and Taxes (“EBDT”), After Tax Cash Flow (“ATCF”) and Same Property Net Operating Income ("NOI"), to report operating results. EBDT, ATCF and NOI are non-GAAP financial measures and may not be directly comparable to similarly-titled measures reported by other companies. Although these financial measures are not presented in accordance with GAAP, we believe these measures assist investors in understanding our business and operating results by providing useful supplemental data regarding the underlying economics of our business operations because operating results presented under GAAP may include items that are nonrecurring or not necessarily relevant to ongoing operations, or are difficult to forecast for future periods. Management uses these non-GAAP financial measures to review our company’s operating results for comparative purposes with respect to previous periods or forecasts, and also to evaluate future prospects. Our investors can also use these non-GAAP financial measures as supplementary information to evaluate operating performance. Our non-GAAP financial measures are not intended to be performance measures that should be regarded as alternatives to, or more meaningful than, our GAAP financial measures. Non-GAAP financial measures have limitations as they do not include all items of income and expense that affect our operations, and accordingly should always be considered as supplemental to our financial results presented in accordance with GAAP.

Pro-Rata Consolidated Statements of Operations and Pro-Rata Consolidated Balance Sheets

Included are pro-rata consolidated statements of operations, as well as pro-rata consolidated balance sheets, because we believe this information is useful to investors as this method reflects the manner in which we operate our business, and provides more detailed information regarding the operations of the unconsolidated investments. We have made investments in which our economic ownership is less than 100% as a means of procuring additional investment opportunities and sharing risk. A significant amount of our business activity has been conducted through our unconsolidated investments. Under GAAP, these investments are not consolidated in our financial statements. Under the pro-rata consolidation method, we present the results of our investments proportionate to our share of ownership. Our management considers the performance of our unconsolidated investments both individually and as a contributing factor to our operating performance for purposes of financial planning and making operating decisions. We believe this presentation of the performance of our unconsolidated investments is helpful to investors in understanding and evaluating our current operating performance as well as for purposes of period-to-period comparisons. We provide reconciliations from the full consolidation method to the pro-rata consolidation method on pages 7- 9 of this supplemental financial information.

Earnings Before Depreciation, Amortization and Taxes (EBDT) and After Tax Cash Flow (ATCF) and Same Property Net Operating Income (NOI)

EBDT, ATCF and Same Property NOI are non-GAAP financial measures and may not be directly comparable to similarly-titled measures reported by other companies. We present these financial measures under the pro-rata consolidation method to provide supplemental information helpful to an understanding of our results of operations. Although these financial measures are not presented in accordance with GAAP, we believe these measures assist investors in understanding our business and operating results. EBDT and ATCF reflect operating performance measurements for our company that assist management in evaluating trends for comparative and planning purposes. Same Property NOI is considered to be an indicator of the performance of our operating properties and is not a performance measurement of the operations of the Company. Our non-GAAP financial measures are not intended to be regarded as alternatives to, or more meaningful than, our GAAP financial measures.

See pages 10 and 11 for a discussion of EBDT and a reconciliation of EBDT to net income (loss), pages 12 and 13 for a discussion of ATCF and a reconciliation of ATCF to net income (loss) and pages 19 and 20 for a discussion of Same Property NOI and a reconciliation of Same Property NOI to Pro-Rata NOI.

Thomas Properties Group, Inc. Supplemental Financial Information CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share data) (unaudited)

	Three months ended						Nine months ended
	September 30,						September 30,
	2012			2011			2012			2011
Revenues:
Rental	$	7,813		$	7,446		$	23,343		$	22,233
Tenant reimbursements	5,344			5,666			15,746			17,051
Parking and other	786			708			2,271			2,225
Investment advisory, management, leasing and development services	1,005			5,565			2,669			7,689
Investment advisory, management, leasing and development services- unconsolidated real estate entities	3,588			4,324			11,909			13,690
Reimbursement of property personnel costs	1,273			1,365			4,140			4,389
Condominium sales	2,302			3,084			4,266			6,122
Total revenues	22,111			28,158			64,344			73,399
Expenses:
Property operating and maintenance	6,183			6,211			18,198			18,384
Real estate and other taxes	1,742			1,854			5,627			5,616
Investment advisory, management, leasing and development services	2,634			3,273			8,628			9,912
Reimbursable property personnel costs	1,273			1,365			4,140			4,389
Cost of condominium sales	1,858			2,055			3,251			4,042
Interest	4,205			4,331			12,659			13,629
Depreciation and amortization	4,120			3,447			11,782			10,188
General and administrative	3,893			3,925			13,024			11,802
Total expenses	25,908			26,461			77,309			77,962
Interest income	39			5			52			25
Equity in net income (loss) of unconsolidated real estate entities	(1,797		)	(353		)	(2,613		)	(1,938		)
Income (loss) before income taxes and noncontrolling interests	(5,555		)	1,349			(15,526		)	(6,476		)
Benefit (provision) for income taxes	442			1,206			368			1,001
Net income (loss)	(5,113		)	2,555			(15,158		)	(5,475		)
Noncontrolling interests' share of net (income) loss:
Unitholders in the Operating Partnership	1,226			(295		)	3,817			1,763
Partners in consolidated real estate entities	(198		)	(177		)	(668		)	(496		)
	1,028			(472		)	3,149			1,267
TPGI share of net income (loss)	$	(4,085	)	$	2,083		$	(12,009	)	$	(4,208	)
Income (loss) per share-basic and diluted	$	(0.09	)	$	0.06		$	(0.30	)	$	(0.11	)
Weighted average common shares-basic	45,517,207			36,647,394			40,301,224			36,610,178
Weighted average common shares-diluted	45,517,207			36,873,339			40,301,224			36,610,178

Thomas Properties Group, Inc. Supplemental Financial Information CONSOLIDATED BALANCE SHEETS (in thousands)

	September 30, 2012		December 31, 2011			September 30, 2012			December 31, 2011
	(unaudited)		(audited)			(unaudited)			(audited)
ASSETS					LIABILITIES AND EQUITY
Investments in real estate:					Liabilities:
Operating properties, net	$	268,921	$	265,202	Mortgage loans	$	284,965		$	289,523
Land improvements—development properties	80,439		80,254		Accounts payable and other liabilities, net	29,537			20,710
	349,360		345,456		Unrecognized tax benefits	11,811			14,012
Condominium units held for sale	42,332		45,217		Prepaid rent and deferred revenue	3,205			3,019
Investments in unconsolidated real estate entities	110,396		11,372		Below market rents, net	133			259
Cash and cash equivalents, unrestricted	58,395		79,320		Obligations associated with land held for disposition	—			27
Restricted cash	14,085		10,616		Total liabilities	329,651			327,550
Rents and other receivables, net	2,244		1,903
Receivables from unconsolidated real estate entities	1,952		2,918		Equity:
Deferred rents	19,014		17,866		Stockholders’ equity:
Deferred leasing and loan costs, net	10,607		12,283		Common stock	461			371
Above market rents, net	242		399		Limited voting stock	123			123
Deferred tax asset, net of valuation allowance	11,811		13,737		Additional paid-in capital	258,625			208,473
Other assets, net	4,266		3,329		Retained deficit and dividends, including $ 0 and $20 of other comprehensive income as of
Assets associated with land held for disposition	—		1,107		September 30, 2012 and December 31, 2011, respectively	(69,297		)	(55,472		)
Total assets	$	624,704	$	545,523	Total stockholders’ equity	189,912			153,495
					Noncontrolling interests:
					Unitholders in the Operating Partnership	48,324			52,983
					Partners in consolidated real estate entities	56,817			11,495
					Total noncontrolling interests	105,141			64,478
					Total equity	295,053			217,973
					Total liabilities and equity	$	624,704		$	545,523

Thomas Properties Group, Inc.

Supplemental Financial Information

UNCONSOLIDATED REAL ESTATE ENTITIES STATEMENTS OF OPERATIONS

(in thousands)

(unaudited)

The following are the combined statements of operations of our unconsolidated real estate entities for the three and nine months ended September 30, 2012 and 2011.



	Three months ended						Nine months ended
	September 30,						September 30,
	2012			2011			2012			2011
Revenues:
Rental	$	38,715		$	40,398		$	116,169		$	116,915
Tenant reimbursements	21,826			20,088			61,180			56,906
Parking and other	7,791			6,282			22,754			20,165
Total revenues	68,332			66,768			200,103			193,986
Expenses:
Property operating and maintenance	27,138			25,653			81,007			73,799
Real estate and other taxes	9,676			8,436			27,019			23,937
Interest	25,678			24,402			77,420			72,402
Depreciation and amortization	21,435			26,494			64,986			70,391
Total expenses	83,927			84,985			250,432			240,529
Income (loss) from continuing operations	(15,595		)	(18,217		)	(50,329		)	(46,543		)
Interest income	10			12			32			40
Gain (loss) on sale of real estate	(60,076		)	—			(60,076		)	—
Income (loss) from discontinued operations	1,800			9,398			(5,050		)	2,082
Net income (loss)	$	(73,861	)	$	(8,807	)	$	(115,423	)	$	(44,421	)
TPGI share of equity in net income (loss) of unconsolidated real estate entities	$	(1,797	)	$	(353	)	$	(2,613	)	$	(1,938	)

Thomas Properties Group, Inc.

Supplemental Financial Information

UNCONSOLIDATED REAL ESTATE ENTITIES BALANCE SHEETS

(in thousands)

(unaudited)

The following are the combined balance sheets of our unconsolidated real estate entities as of September 30, 2012 and December 31, 2011.



	September 30, 2012		December 31, 2011
ASSETS
Investments in real estate, net	$	1,593,991	$	1,723,107
Cash and cash equivalents, unrestricted	28,126		24,583
Restricted cash	13,167		22,415
Rents and other receivables, net	4,263		3,592
Deferred rents	62,732		79,490
Deferred leasing and loan costs, net	111,491		92,562
Other assets	6,406		5,534
Assets associated with discontinued operations	248		190,110
Total assets	$	1,820,424	$	2,141,393

LIABILITIES AND EQUITY
Mortgage loans	$	1,391,873	$	1,591,881
Accounts and interest payable and other liabilities	58,775		72,668
Below market rents, net	4,926		34,019
Liabilities associated with discontinued operations	246		135,506
Total liabilities	1,455,820		1,834,074
Equity	364,604		307,319
Total liabilities and equity	$	1,820,424	$	2,141,393

Thomas Properties Group, Inc.

Supplemental Financial Information

PRO-RATA CONSOLIDATED STATEMENTS OF OPERATIONS (NON-GAAP)

(in thousands unaudited)

The following are the pro-rata consolidated statements of operations of TPGI for the three months ended September 30, 2012 and 2011, including reconciliation from the consolidated statements of operations to the pro-rata consolidated statements of operations.



	For the three months ended September 30, 2012												For the three months ended September 30, 2011
	Consolidated			Plus Unconsolidated Investments at Pro-Rata			Less Non- Controlling Interest Share			Pro-Rata			Consolidated			Plus Unconsolidated Investments at Pro-Rata		Pro-Rata
Revenues:
Rental	$	7,813		$	6,230		$	(301	)	$	13,742		$	7,446		$	5,552	$	12,998
Tenant reimbursements	5,344			3,320			(218		)	8,446			5,666			2,436		8,102
Parking and other	786			1,204			(82		)	1,908			708			669		1,377
Investment advisory, management, leasing and development services	1,005			—			—			1,005			5,565			—		5,565
Investment advisory, management, leasing and development services- unconsolidated real estate entities	3,588			—			—			3,588			4,324			108		4,432
Reimbursement of property personnel costs	1,273			—			—			1,273			1,365			—		1,365
Condominium sales	2,302			—			—			2,302			3,084			—		3,084
Total revenues	22,111			10,754			(601		)	32,264			28,158			8,765		36,923
Expenses:
Property operating and maintenance	6,183			3,542			(167		)	9,558			6,211			3,119		9,330
Real estate and other taxes	1,742			1,698			(111		)	3,329			1,854			1,088		2,942
Investment advisory, management, leasing and development services	2,634			—			—			2,634			3,273			—		3,273
Reimbursable property personnel costs	1,273			—			—			1,273			1,365			—		1,365
Cost of condominium sales	1,858			—			—			1,858			2,055			—		2,055
Interest	4,205			3,330			(228		)	7,307			4,331			2,682		7,013
Depreciation and amortization	4,120			3,017			(224		)	6,913			3,447			2,854		6,301
General and administrative	3,893			—			—			3,893			3,925			—		3,925
Total expenses	25,908			11,587			(730		)	36,765			26,461			9,743		36,204
Gain (loss) on sale of real estate	—			(1,288		)	—			(1,288		)	—			—		—
Interest income	39			1			—			40			5			1		6
Equity in net income (loss) of unconsolidated real estate entities	(1,797		)	1,797			—			—			(353		)	353		—
Income (loss) associated with discontinued operations	—			323			—			323			—			624		624
Income (loss) before income taxes and noncontrolling interests	(5,555		)	—			129			(5,426		)	1,349			—		1,349
Benefit (provision) for income taxes	442			—			—			442			1,206			—		1,206
Net income (loss)	(5,113		)	—			129			(4,984		)	2,555			—		2,555
Noncontrolling interests' share of net (income) loss:
Unitholders in the Operating Partnership	1,226			—			—			1,226			(295		)	—		(295		)
Partners in consolidated real estate entities	(198		)	—			(129		)	(327		)	(177		)	—		(177		)
	1,028			—			(129		)	899			(472		)	—		(472		)
TPGI share of net income (loss)	$	(4,085	)	$	—		$	—		$	(4,085	)	$	2,083		$	—	$	2,083

Thomas Properties Group, Inc.

Supplemental Financial Information

PRO-RATA CONSOLIDATED STATEMENTS OF OPERATIONS (NON-GAAP)

(in thousands, unaudited)

The following are the pro-rata consolidated statements of operations of TPGI for the nine months ended September 30, 2012 and 2011, including reconciliation from the consolidated statements of operations to the pro-rata consolidated statements of operations.



	For the nine months ended September 30, 2012												For the nine months ended September 30, 2011
	Consolidated			Plus Unconsolidated Investments at Pro-Rata			Less Non- Controlling Interest Share			Pro-Rata			Consolidated			Plus Unconsolidated Investments at Pro-Rata		Pro-Rata
Revenues:
Rental	$	23,343		$	17,202		$	(301	)	$	40,244		$	22,233		$	16,461	$	38,694
Tenant reimbursements	15,746			8,094			(218		)	23,622			17,051			6,786		23,837
Parking and other	2,271			2,918			(82		)	5,107			2,225			2,317		4,542
Investment advisory, management, leasing and development services	2,669			—			—			2,669			7,689			—		7,689
Investment advisory, management, leasing and development services- unconsolidated real estate entities	11,909			—			—			11,909			13,690			324		14,014
Reimbursement of property personnel costs	4,140			—			—			4,140			4,389			—		4,389
Condominium sales	4,266			—			—			4,266			6,122			—		6,122
Total revenues	64,344			28,214			(601		)	91,957			73,399			25,888		99,287
Expenses:
Property operating and maintenance	18,198			9,913			(167		)	27,944			18,384			8,882		27,266
Real estate and other taxes	5,627			4,067			(111		)	9,583			5,616			3,136		8,752
Investment advisory, management, leasing and development services	8,628			—						8,628			9,912			—		9,912
Reimbursable property personnel costs	4,140			—			—			4,140			4,389			—		4,389
Cost of condominium sales	3,251			—			—			3,251			4,042			—		4,042
Interest	12,659			8,786			(228		)	21,217			13,629			8,008		21,637
Depreciation and amortization	11,782			7,840			(224		)	19,398			10,188			7,842		18,030
General and administrative	13,024			—			—			13,024			11,802			—		11,802
Total expenses	77,309			30,606			(730		)	107,185			77,962			27,868		105,830
Gain (loss) on sale of real estate	—			(1,288		)	—			(1,288		)	—			—		—
Interest income	52			3			—			55			25			4		29
Equity in net income (loss) of unconsolidated real estate entities	(2,613		)	2,613			—			—			(1,938		)	1,938		—
Income (loss) associated with discontinued operations	—			1,064						1,064			—			38		38
Income (loss) before income taxes and noncontrolling interests	(15,526		)	—			129			(15,397		)	(6,476		)	—		(6,476		)
Benefit (provision) for income taxes	368			—			—			368			1,001			—		1,001
Net income (loss)	(15,158		)	—			129			(15,029		)	(5,475		)	—		(5,475		)
Noncontrolling interests' share of net (income) loss:
Unitholders in the Operating Partnership	3,817			—			—			3,817			1,763			—		1,763
Partners in consolidated real estate entities	(668		)	—			(129		)	(797		)	(496		)	—		(496		)
	3,149			—			(129		)	3,020			1,267			—		1,267
TPGI share of net income (loss)	$	(12,009	)	$	—		$	—		$	(12,009	)	$	(4,208	)	$	—	$	(4,208	)

Thomas Properties Group, Inc.

Supplemental Financial Information

PRO-RATA CONSOLIDATED BALANCE SHEETS (NON-GAAP)

(in thousands)

(unaudited)

The following are the pro-rata consolidated balance sheets of TPGI as of September 30, 2012 and December 31, 2011, including reconciliation from the consolidated balance sheets to the pro-rata consolidated balance sheets.



	September 30, 2012										December 31, 2011
	Consolidated		Plus Unconsolidated Investments at Pro-Rata			Less Non- Controlling Interest Share			Pro-Rata		Consolidated		Plus Unconsolidated Investments at Pro-Rata			Pro-Rata
ASSETS
Investments in real estate, net	$	349,360	$	509,287		$	(131,234	)	$	727,413	$	345,456	$	168,016		$	513,472
Investments in unconsolidated real estate entities	110,396		(110,396		)	—			—		11,372		(11,372		)	—
Condominium units held for sale	42,332		—			—			42,332		45,217		—			45,217
Cash and cash equivalents, unrestricted	58,395		7,706			(1,269		)	64,832		79,320		3,640			82,960
Restricted cash	14,085		4,909			(1,100		)	17,894		10,616		2,388			13,004
Rents and other receivables, net	4,196		1,473			(309		)	5,360		4,821		883			5,704
Above market rents, net	242		—			—			242		399		—			399
Deferred rents	19,014		8,856			(153		)	27,717		17,866		9,424			27,290
Deferred leasing and loan costs, net	10,607		37,464			(9,997		)	38,074		12,283		10,366			22,649
Deferred tax asset, net of valuation allowance	11,811		—			—			11,811		13,737		—			13,737
Other assets, net	4,266		672			(61		)	4,877		3,329		689			4,018
Assets associated with discontinued operations	—		36			—			36		1,107		24,761			25,868
Total assets	$	624,704	$	460,007		$	(144,123	)	$	940,588	$	545,523	$	208,795		$	754,318

LIABILITIES AND EQUITY
Mortgage loans	$	284,965	$	449,073		$	(104,323	)	$	629,715	$	289,523	$	184,925		$	474,448
Accounts payable and other liabilities	29,537		8,351			(4,559		)	33,329		20,710		2,152			22,862
Unrecognized tax benefits	11,811		—			—			11,811		14,012		—			14,012
Below market rents, net	133		991			—			1,124		259		2,972			3,231
Prepaid rent and deferred revenue	3,205		1,569			(316		)	4,458		3,019		2,421			5,440
Liabilities associated with discontinued operations	—		23			—			23		27		16,325			16,352
Total liabilities	329,651		460,007			(109,198		)	680,460		327,550		208,795			536,345
Noncontrolling interests	105,141		—			(34,925		)	70,216		64,478		—			64,478
Total stockholders' equity	189,912		—			—			189,912		153,495		—			153,495
Total liabilities and equity	$	624,704	$	460,007		$	(144,123	)	$	940,588	$	545,523	$	208,795		$	754,318

Thomas Properties Group, Inc.

Supplemental Financial Information

EARNINGS BEFORE DEPRECIATION, AMORTIZATION AND TAXES (EBDT) (NON-GAAP)

(in thousands, except share and per share data)

(unaudited)

We use EBDT as a supplemental performance measure. EBDT excludes the following items: i) income tax expense (benefit); ii) noncontrolling interests; iii) non-cash charges for depreciation and amortization; and iv) amortization of loan costs. EBDT provides a performance measure that, when compared year over year, reflects the impact to operations from changes in occupancy, rental rates, operating costs, development and redevelopment activities, general and administrative expenses, and interest costs; and EBDT provides perspective on operating performance not immediately apparent from net income. EBDT should be considered only as a supplement to net income as a measure of our performance. EBDT also assists our management in identifying trends for purposes of financial planning and forecasting results. However, the usefulness of EBDT as a performance measure is limited and EBDT should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs. EBDT also should not be used as a supplement to or substitute for cash flow from operating activities (computed in accordance with GAAP) or as an alternative to net income (loss) as an indicator of our operating performance.

Reconciliation of Net Income (Loss) to EBDT:



	For the three months ended September 30, 2012													For the three months ended September 30, 2011
				Plus Unconsolidated Investments at Pro-Rata				Less Non-Controlling Interest Share- Continuing Operations									Plus Unconsolidated Investments at Pro-Rata
	Consolidated			Continuing Operations		Discontinued Operations		Less Non-Controlling Interest Share- Continuing Operations			Pro-Rata			Consolidated			Continuing Operations		Discontinued Operations		Pro-Rata
Net income (loss)	$	(4,085	)	$	—	$	—	$	—		$	(4,085	)	$	2,083		$	—	$	—	$	2,083
Income tax (benefit) provision	(442		)	—		—		—			(442		)	(1,206		)	—		—		(1,206		)
Noncontrolling interests - unitholders in the Operating Partnership	(1,226		)	—		—		—			(1,226		)	295			—		—		295
Depreciation and amortization	4,120			3,017		—		(224		)	6,913			3,447			2,854		427		6,728
Amortization of loan costs	120			41		21		—			182			153			136		26		315
EBDT	$	(1,513	)	$	3,058	$	21	$	(224	)	$	1,342		$	4,772		$	2,990	$	453	$	8,215
TPGI share of EBDT (1)	$	(1,189	)	$	2,402	$	16	$	(176	)	$	1,053		$	3,565		$	2,234	$	338	$	6,137

EBDT per share - basic											$	0.02									$	0.17
EBDT per share - diluted											$	0.02									$	0.17

Weighted average common shares outstanding - basic											45,517,207										36,647,394
Weighted average common shares outstanding - diluted											45,902,063										36,873,339

(1) Based on an interest in our operating partnership of 78.56% and 74.70% for the three months ended September 30, 2012 and 2011, respectively.

Thomas Properties Group, Inc.

Supplemental Financial Information

EARNINGS BEFORE DEPRECIATION, AMORTIZATION AND TAXES (EBDT) (NON-GAAP)

(in thousands, except share and per share data)

(unaudited)

Reconciliation of Net Income (Loss) to EBDT:



	For the nine months ended September 30, 2012													For the nine months ended September 30, 2011
				Plus Unconsolidated Investments at Pro-Rata				Less Non-Controlling Interest Share- Continuing Operations									Plus Unconsolidated Investments at Pro-Rata
	Consolidated			Continuing Operations		Discontinued Operations		Less Non-Controlling Interest Share- Continuing Operations			Pro-Rata			Consolidated			Continuing Operations		Discontinued Operations		Pro-Rata
Net income (loss)	$	(12,009	)	$	—	$	—	$	—		$	(12,009	)	$	(4,208	)	$	—	$	—	$	(4,208	)
Income tax (benefit) provision	(368		)	—		—		—			(368		)	(1,001		)	—		—		(1,001		)
Noncontrolling interests - unitholders in the Operating Partnership	(3,817		)	—		—		—			(3,817		)	(1,763		)	—		—		(1,763		)
Depreciation and amortization	11,782			7,840		153		(224		)	19,551			10,188			7,842		1,789		19,819
Amortization of loan costs	440			196		33		—			669			580			229		83		892
EBDT	$	(3,972	)	$	8,036	$	186	$	(224	)	$	4,026		$	3,796		$	8,071	$	1,872	$	13,739
TPGI share of EBDT (1)	$	(3,036	)	$	6,142	$	142	$	(171	)	$	3,077		$	2,836		$	6,031	$	1,398	$	10,265

EBDT per share - basic											$	0.08									$	0.28
EBDT per share - diluted											$	0.08									$	0.28

Weighted average common shares outstanding - basic											40,301,224										36,610,178
Weighted average common shares outstanding - diluted											40,668,418										36,863,237

(1) Based on an interest in our operating partnership of 76.43% and 74.72% for the nine months ended September 30, 2012 and 2011, respectively.

Thomas Properties Group, Inc.

Supplemental Financial Information

AFTER TAX CASH FLOW (ATCF) (NON-GAAP)

(in thousands, except share and per share data)

(unaudited)

We define ATCF as net income (loss) excluding the following items: i) deferred income tax expense (benefit); ii) noncontrolling interests; iii) non-cash charges for depreciation, amortization and asset impairment; iv) amortization of loan costs; v) non-cash compensation expense; vi) the adjustment to recognize rental revenues using the straight-line method; vii) the adjustments to rental revenue to reflect the fair market value of rent; and viii) gain from extinguishment of debt. Our management utilizes ATCF data in assessing performance of our business operations in period to period comparisons and for financial planning purposes. ATCF should be considered only as a supplement to net income as a measure of our performance. ATCF should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs. ATCF also should not be used as a supplement to or substitute for cash flow from operating activities (computed in accordance with GAAP).

Reconciliation of Net Income (Loss) to ATCF:



	For the three months ended September 30, 2012														For the three months ended September 30, 2011
				Plus Unconsolidated Investments at Pro-Rata					Less Non-Controlling Interest Share- Continuing Operations									Plus Unconsolidated Investments at Pro-Rata
	Consolidated			Continuing Operations			Discontinued Operations		Less Non-Controlling Interest Share- Continuing Operations			Pro-Rata			Consolidated			Continuing Operations			Discontinued Operations			Pro-Rata
Net income (loss)	$	(4,085	)	$	—		$	—	$	—		$	(4,085	)	$	2,083		$	—		$	—		$	2,083
Income tax (benefit) provision	(442		)	—			—		—			(442		)	(1,206		)	—			—			(1,206		)
Noncontrolling interests - unitholders in the Operating Partnership	(1,226		)	—			—		—			(1,226		)	295			—			—			295
Depreciation and amortization	4,120			3,017			—		(224		)	6,913			3,447			2,854			427			6,728
Amortization of loan costs	120			41			21		—			182			153			136			26			315
Non-cash compensation expense	324			—			—		—			324			127			—			—			127
Straight-line rent adjustments	59			(111		)	—		34			(18		)	(22		)	(57		)	(46		)	(125		)
Adjustments to reflect the fair market value of rent	12			(177		)	—		—			(165		)	7			(358		)	(10		)	(361		)
Gain from extinguishment of debt	—			—			—		—			—			—			—			(333		)	(333		)
ATCF before income taxes	$	(1,118	)	$	2,770		$	21	$	(190	)	$	1,483		$	4,884		$	2,575		$	64		$	7,523

TPGI share of ATCF before income taxes (1)	$	(878	)	$	2,176		$	16	$	(150	)	$	1,164		$	3,648		$	1,924		$	48		$	5,620
TPGI income tax refund (expense) - current	144			—			—		—			144			(48		)	—			—			(48		)
TPGI share of ATCF	$	(734	)	$	2,176		$	16	$	(150	)	$	1,308		$	3,600		$	1,924		$	48		$	5,572

ATCF per share - basic												$	0.03											$	0.15
ATCF per share - diluted												$	0.03											$	0.15
Dividends paid per share												$	0.015											$	—
Weighted average common shares outstanding - basic												45,517,207												36,647,394
Weighted average common shares outstanding - diluted												45,902,063												36,873,339

(1) Based on an interest in our operating partnership of 78.56% and 74.70% for the three months ended September 30, 2012 and 2011, respectively.

Thomas Properties Group, Inc.

Supplemental Financial Information

AFTER TAX CASH FLOW (ATCF) (NON-GAAP)

(in thousands, except share and per share data)

(unaudited)

Reconciliation of Net Income (Loss) to ATCF:



	For the nine months ended September 30, 2012															For the nine months ended September 30, 2011
				Plus Unconsolidated Investments at Pro-Rata						Less Non-Controlling Interest Share- Continuing Operations									Plus Unconsolidated Investments at Pro-Rata
	Consolidated			Continuing Operations			Discontinued Operations			Less Non-Controlling Interest Share- Continuing Operations			Pro-Rata			Consolidated			Continuing Operations			Discontinued Operations			Pro-Rata
Net income (loss)	$	(12,009	)	$	—		$	—		$	—		$	(12,009	)	$	(4,208	)	$	—		$	—		$	(4,208	)
Income tax (benefit) provision	(368		)	—			—			—			(368		)	(1,001		)	—			—			(1,001		)
Noncontrolling interests - unitholders in the Operating Partnership	(3,817		)	—			—			—			(3,817		)	(1,763		)	—			—			(1,763		)
Depreciation and amortization	11,782			7,840			153			(224		)	19,551			10,188			7,842			1,789			19,819
Amortization of loan costs	440			196			33			—			669			580			229			83			892
Non-cash compensation expense	1,235			—			—			—			1,235			660			—			—			660
Straight-line rent adjustments	(296		)	(118		)	(20		)	34			(400		)	(170		)	(107		)	(301		)	(578		)
Adjustments to reflect the fair market value of rent	31			(609		)	(11		)	—			(589		)	16			(806		)	1			(789		)
Gain from extinguishment of debt	—			—			—			—			—			—			—			(333		)	(333		)
ATCF before income taxes	$	(3,002	)	$	7,309		$	155		$	(190	)	$	4,272		$	4,302		$	7,158		$	1,239		$	12,699

TPGI share of ATCF before income taxes (1)	$	(2,294	)	$	5,586		$	118		$	(145	)	$	3,265		$	3,214		$	5,348		$	926		$	9,488
TPGI income tax refund (expense) - current	108			—			—			—			108			(157		)	—			—			(157		)
TPGI share of ATCF	$	(2,186	)	$	5,586		$	118		$	(145	)	$	3,373		$	3,057		$	5,348		$	926		$	9,331

ATCF per share - basic													$	0.08											$	0.25
ATCF per share - diluted													$	0.08											$	0.25
Dividends paid per share													$	0.045											$	—
Weighted average common shares outstanding - basic													40,301,224												36,610,178
Weighted average common shares outstanding - diluted													40,668,418												36,863,237

(1) Based on an interest in our operating partnership of 76.43% and 74.72% for the nine months ended September 30, 2012 and 2011, respectively.

Thomas Properties Group, Inc.

Supplemental Financial Information

INVESTMENT ADVISORY, MANAGEMENT, LEASING AND DEVELOPMENT SERVICES

(in thousands)

(unaudited)



Three months ended September 30, 2012	Property Management Fees		Development Services Fees		Leasing Fees		Investment Advisory Fees		Total Fees
Source of revenues:
Consolidated real estate entities	$	440	$	129	$	240	$	67	$	876
Unconsolidated real estate entities	2,103		98		845		1,262		4,308
Managed properties	501		115		298		90		1,004
Total investment advisory, management, leasing and development services revenue	$	3,044	$	342	$	1,383	$	1,419	6,188
Investment advisory, management, leasing and development services expenses									(2,634		)
Net investment advisory, management, leasing and development services income									$	3,554

Reconciliation to GAAP presentation:
Total investment advisory, management, leasing and development services revenue									$	6,188
Elimination of intercompany fee revenues									(1,595		)
Investment advisory, management, leasing and development services revenue, as reported									$	4,593

Three months ended September 30, 2011
Source of revenues:
Consolidated real estate entities	$	420	$	47	$	189	$	68	$	724
Unconsolidated real estate entities	2,370		300		1,006		1,532		5,208
Managed properties	483		493		134		4,282		5,392
Total investment advisory, management, leasing and development services revenue	$	3,273	$	840	$	1,329	$	5,882	11,324
Investment advisory, management, leasing and development services expenses									(3,273		)
Net investment advisory, management, leasing and development services income									$	8,051

Reconciliation to GAAP presentation:
Total investment advisory, management, leasing and development services revenue									$	11,324
Elimination of intercompany fee revenues									(1,435		)
Investment advisory, management, leasing and development services revenue, as reported									$	9,889

Thomas Properties Group, Inc.

Supplemental Financial Information

INVESTMENT ADVISORY, MANAGEMENT, LEASING AND DEVELOPMENT SERVICES

(in thousands)

(unaudited)



Nine months ended September 30, 2012	Property Management Fees		Development Services Fees		Leasing Fees		Investment Advisory Fees		Total Fees
Source of revenues:
Consolidated real estate entities	$	1,314	$	301	$	435	$	201	$	2,251
Unconsolidated real estate entities	6,308		564		3,335		3,555		13,762
Managed properties	1,456		255		708		250		2,669
Total investment advisory, management, leasing and development services revenue	$	9,078	$	1,120	$	4,478	$	4,006	18,682
Investment advisory, management, leasing and development services expenses									(8,628		)
Net investment advisory, management, leasing and development services income									$	10,054

Reconciliation to GAAP presentation:
Total investment advisory, management, leasing and development services revenue									$	18,682
Elimination of intercompany fee revenues									(4,104		)
Investment advisory, management, leasing and development services revenue, as reported									$	14,578

Nine months ended September 30, 2011
Source of revenues:
Consolidated real estate entities	$	1,249	$	124	$	502	$	202	$	2,077
Unconsolidated real estate entities	7,131		755		3,926		4,265		16,077
Managed properties	1,294		973		835		4,414		7,516
Total investment advisory, management, leasing and development services revenue	$	9,674	$	1,852	$	5,263	$	8,881	25,670
Investment advisory, management, leasing and development services expenses									(9,912		)
Net investment advisory, management, leasing and development services income									$	15,758

Reconciliation to GAAP presentation:
Total investment advisory, management, leasing and development services revenue									$	25,670
Elimination of intercompany fee revenues									(4,291		)
Investment advisory, management, leasing and development services revenue, as reported									$	21,379

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA

Our Operating Properties



		As of September 30, 2012					TPGI Share (1) (in thousands except square footage)
	Location	Rentable Square Feet (2)	Percent Leased		TPGI Percentage Interest		Rentable Square Feet	Trailing Twelve Months Ended September 30, 2012 Adjusted Historical NOI - Cash Basis (3)			Current Annualized NOI (4)			Pro-Forma Annualized NOI at 95% Occupancy (5)		Currently Committed Leasing Capital Costs (6)			Estimated Incremental Leasing Capital Costs (6)			Net Current Assets			Encumbrances at September 30, 2012
Consolidated Operating Properties
One Commerce Square (7)	Philadelphia, PA	942,866	96.6	%	100.0	%	942,866	$	13,684		$	15,244		$	14,998	$	(2,986	)	$	—		$	—		$	136,294
Two Commerce Square (7)	Philadelphia, PA	953,276	78.7		100.0		953,276	12,321			10,526			13,165		(1,642		)	(8,539		)	—			115,067
Four Points Centre	Austin, TX	193,862	57.8		100.0		193,862	(118		)	1,281			1,048		(1,247		)	(3,409		)	—			24,500		(8	)
Subtotal Consolidated Operating Properties		2,090,004	84.8				2,090,004	25,887			27,051			29,211		(5,875		)	(11,948		)	—			275,861

Joint Venture Operating Properties
2121 Market Street	Philadelphia, PA	154,959	95.9		50.0		77,480	1,283			1,252			1,240		—			—			263			8,763

TPG/CalSTRS Joint Venture:
City National Plaza	Los Angeles, CA	2,496,084	86.7		7.9		198,127	3,189			3,919			4,297		(1,017		)	(1,151		)	(131		)	27,821
Reflections I	Reston, VA	123,546	—		25.0		30,887	(184		)	(107		)	655		—			(1,978		)	125			5,159
Reflections II	Reston, VA	64,253	—		25.0		16,063	225			(73		)	252		—			(504		)	125			2,149
San Felipe Plaza	Houston, TX	980,472	81.8		25.0		245,118	2,844			3,377			4,040		(176		)	(1,293		)	(191		)	27,500
CityWestPlace	Houston, TX	1,473,020	99.0		25.0		368,255	5,551			6,498			6,235		(198		)	—			1,174			53,620
Fair Oaks Plaza	Fairfax, VA	179,688	84.9		25.0		44,922	728			725			830		(3		)	(205		)	(42		)	11,075
Subtotal TPG/CalSTRS Joint Venture		5,317,063	86.1				903,372	12,353			14,339			16,309		(1,394		)	(5,131		)	1,060			127,324
Austin Joint Venture:
Frost Bank Tower	Austin, TX	535,078	92.4		33.3		178,368	4,479			4,760			4,899		(265		)	(291		)	(1,051		)	50,002
300 West 6th Street	Austin, TX	454,225	86.6		33.3		151,416	2,588			3,881			4,225		(1,279		)	(765		)	(436		)	42,335
San Jacinto Center	Austin, TX	410,248	81.5		33.3		136,756	1,987			2,752			3,213		(250		)	(1,106		)	(761		)	33,668
One Congress Plaza	Austin, TX	518,385	90.9		33.3		172,804	3,022			3,323			3,491		(582		)	(420		)	(1,086		)	42,669
One American Center	Austin, TX	503,951	74.7		33.3		167,992	1,135			2,276			3,059		(1,082		)	(2,044		)	(1,044		)	40,002
Westech 360 I-IV	Austin, TX	175,529	73.3		33.3		58,513	375			665			843		(93		)	(355		)	(70		)	—
Park Centre	Austin, TX	203,193	80.0		33.3		67,734	412			472			614		(181		)	(285		)	(115		)	—
Great Hills Plaza	Austin, TX	139,252	94.5		33.3		46,420	320			602			605		(18		)	(7		)	(88		)	—
Subtotal Austin Joint Venture		2,939,861	84.8				980,003	14,318			18,731			20,949		(3,750		)	(5,273		)	(4,651		)	208,676
Total / Average		10,501,887	85.6	%			4,050,859	$	53,841		$	61,373		$	67,709	$	(11,019	)	$	(22,352	)	$	(3,328	)	$	620,624

Footnotes on following page.

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

Footnotes to Portfolio Data on previous page:


(1)	TPGI share information set forth in the table on the previous page is calculated by multiplying the applicable data for each property by our percentage ownership of each property.


(2)	For purposes of the table on the previous page, both on-site and off-site parking is excluded. Total portfolio square footage includes office properties and mixed-use space (including retail).


(3)	Adjusted historical net operating income - cash basis represents the sum of (in thousands):



	Twelve Months Ended December 31, 2011			Less Nine Months Ended September 30, 2011			Plus Nine Months Ended September 30, 2012			Trailing Twelve Months Ended September 30, 2012
Rental, tenant reimbursements, and parking and other revenue	$	90,532		$	(67,073	)	$	68,973		$	92,432
Property operating and maintenance expenses and real estate taxes	(48,954		)	36,018			(37,527		)	(50,463		)
Pro-Rata Net Operating Income	41,578			(31,055		)	31,446			41,969
Adjustments:
Straight line and other GAAP rent adjustments	(1,386		)	1,067			(1,042		)	(1,361		)
Free rent granted and termination fees earned for the period	1,171			(1,621		)	2,790			2,340
Net operating loss from development properties	1,887			(1,682		)	1,865			2,070
Net operating income (loss) from discontinued operations	(482		)	—			—			(482		)
Elimination of intercompany revenues and expenses	(1,424		)	1,337			(2,004		)	(2,091		)
Adjustment to revenues and operating expenses for change in ownership interest in Austin (a)	10,981			(7,534		)	7,949			11,396
Adjusted Historical Net Operating Income - Cash Basis	$	52,325		$	(39,488	)	$	41,004		$	53,841
Adjustments related to discontinued operations sold and no longer reported in portfolio data	$	(9,630	)
Adjusted Historical Net Operating Income - Cash Basis as Reported	$	42,695
(a) Adjusted Historical NOI reflects the Austin portfolio at 33.33%.


(4)	Current annualized net operating income represents the sum of i) pro-rata net operating income for the month of October 2012, annualized; and ii) the annual straight-line rent adjustment for existing leases which were in place as of September 30, 2012, calculated as if the leases began on September 30, 2012.

(5)

For properties that are less than 95% leased, pro-forma annualized net operating income represents the sum of i) current annualized net operating income, and ii) an upward adjustment to net operating income based on current market rent to achieve 95% occupancy. For properties that are more than 95% leased, pro-forma annualized net operating income represents the sum of i) current annualized net operating income, and ii) a downward adjustment to net operating income based on average in place rent to achieve 95% occupancy.


(6)	Currently committed leasing capital costs represent existing contractual obligations for tenant improvement and leasing commission costs for leases in place as of

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

September 30, 2012. Estimated incremental leasing capital costs represents capital expenditures, including tenant improvements and leasing commissions, expected to be spent to achieve 95% occupancy.

(7)

Brandywine Realty Trust ("BDN") has a preferred equity position in the partnerships that own Commerce Square. BDN will contribute a total of $25.0 million in the form of preferred equity to the partnerships, of which $16.1 million has been contributed as of September 30, 2012, with the balance to be contributed by December 31, 2012. The preferred equity, which earns a preferred return of 9.25%, is being invested in a value-enhancement program designed to increase rental rates and occupancy at Commerce Square. The preferred equity balances as of September 30, 2012, including accrued preferred return, of $9.0 million and $8.3 million have been added to the encumbrances of each of One Commerce Square and Two Commerce Square, respectively.


(8)	An additional $6.2 million may be borrowed under this loan.

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

Same Property NOI is a non-GAAP financial measure and may not be directly comparable to similarly-titled measures reported by other companies. We present this financial measure under the pro-rata consolidation method to provide supplemental information helpful to an understanding of the results of operations of our operating properties. Same Property NOI does not reflect the consolidated operations of the company, nor is it indicative of funds available to fund our cash needs. Same Property NOI also should not be used as a supplement to or substitute for cash flow from operating activities (computed in accordance with GAAP) or as an alternative to net income (loss) as an indicator of our operating performance.

Same Property Net Operating Income (NOI) Comparison



	As of and for the three months ended September 30,
		TPGI Share
		(in thousands except square footage)
			NOI - Cash						NOI - GAAP						Percent Leased
	Number of Properties	Rentable Square Feet	2012		2011		Percentage Change		2012		2011		Percentage Change		2012		2011		Change
Same Properties:
Consolidated Operating Properties	3	2,090,004	$	6,279	$	6,100	2.9	%	$	6,215	$	6,124	1.5	%	84.8	%	81.6	%	3.2	%
Joint Venture Operating Properties	15	1,960,855	12,478		11,403		9.4		14,857		14,878		(0.1	)	85.8		86.7		(0.9	)
Total/Average	18	4,050,859	$	18,757	$	17,503	7.2	%	$	21,072	$	21,002	0.3	%	85.6	%	85.7	%	(0.1	)%


	As of and for the nine months ended September 30,
		TPGI Share
		(in thousands except square footage)
			NOI - Cash						NOI - GAAP						Percent Leased
	Number of Properties	Rentable Square Feet	2012		2011		Percentage Change		2012		2011		Percentage Change		2012		2011		Change
Same Properties:
Consolidated Operating Properties	3	2,090,004	$	17,942	$	18,234	(1.6	)%	$	18,206	$	18,388	(1.0	)%	84.8	%	81.6	%	3.2	%
Joint Venture Operating Properties	15	1,960,855	20,440		19,633		4.1		23,265		23,613		(1.5	)	85.8		86.7		(0.9	)
Total/Average	18	4,050,859	$	38,382	$	37,867	1.4	%	$	41,471	$	42,001	(1.3	)%	85.6	%	85.7	%	(0.1	)%

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

Reconciliation of Same Property NOI - Cash and NOI- GAAP to Pro-Rata NOI (in thousands):



	Three months ended						Nine months ended
	September 30,						September 30,
	2012			2011			2012			2011
Rental, tenant reimbursements, and parking and other revenue	$	24,096		$	22,477		$	68,973		$	67,073
Property operating and maintenance expenses and real estate taxes	(12,887		)	(12,272		)	(37,527		)	(36,018		)
Pro-Rata NOI	11,209			10,205			31,446			31,055

Adjustments:
Straight line and other GAAP rent adjustments	(218		)	(432		)	(992		)	(1,067		)
Net operating loss from development properties and other properties	358			639			1,478			1,682
Elimination of intercompany revenues and expenses	(541		)	(443		)	(1,499		)	(1,337		)
Adjustment to revenues and operating expenses for change in ownership interest in Austin (a)	7,949			7,534			7,949			7,534
Same Property NOI - Cash	18,757			17,503			38,382			37,867

Straight line and other GAAP rent adjustments	218			432			992			1,067
Straight line and other GAAP rent adjustments - adjustment for change in ownership interest in Austin (a)	2,097			3,067			2,097			3,067
Straight line and other GAAP rent adjustments	2,315			3,499			3,089			4,134

Same Property NOI - GAAP	$	21,072		$	21,002		$	41,471		$	42,001
(a) Same Property NOI reflects 33.33% of the Austin portfolio operations for comparative purposes.

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

Lease Expirations

The following table presents a summary of lease expirations for our portfolio for leases in place at September 30, 2012, plus available space. This table assumes that none of the tenants exercise renewal options or early termination rights, if any, at or prior to the scheduled expirations. Annualized net rent is based on the current net rent per leased square foot and excludes the effect of GAAP deferred rent adjustments and parking and other revenues.



TPGI Share of Consolidated and Unconsolidated Properties' Lease Expirations
Year	Rentable Square Feet of Expiring Leases	Percentage of Aggregate Square Feet		Current Annualized Net Rent Per Leased Square Foot		Annualized Net Rent Per Leased Square Foot at Expiration
Vacant	597,491	14.8	%	$	—	$	—
2012	125,878	3.1		18.13		18.83
2013	316,296	7.8		18.47		18.73
2014	369,387	9.1		17.57		18.11
2015	572,917	14.1		17.13		18.11
2016	226,004	5.6		18.74		21.06
2017	428,244	10.6		16.08		18.66
2018	199,993	4.9		12.41		20.92
2019	107,736	2.7		14.86		23.52
2020	432,594	10.7		14.07		22.38
2021	287,566	7.1		15.91		21.54
Thereafter	386,753	9.5		13.40		25.03
Total/Weighted Average	4,050,859	100.0	%	$	16.06	$	20.38

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

Lease Activity



	TPGI Share
	For the Three Months Ended
	September 30, 2012			June 30, 2012			March 31, 2012			December 31, 2011			September 30, 2011
Retention (square feet):
Retained tenants	59,147			63,226			10,401			104,131			13,842
Leases expired	101,973			106,563			24,709			148,700			25,716
Retention %	58.0		%	59.3		%	42.1		%	70.0		%	53.8		%

All Leases Signed (square feet)	182,528			78,378			39,258			132,270			50,414
Weighted Average Lease Term (years):	7.6			7.8			6.4			8.0			6.1
Weighted Average Free Rent Term (months):	4.7			4.2			3.8			3.2			2.8
Total Capital Costs Committed (per square foot per lease year) (1):
New leases	$	6.92		$	5.16		$	6.69		$	7.12		$	7.01
Renewals	$	1.73		$	2.47		$	4.08		$	3.83		$	2.77
Combined	$	6.20		$	3.32		$	6.06		$	6.97		$	6.16
Quarterly Leasing Spread:
New leases	61,488			17,333			23,260			76,757			23,811
Renewals	32,637			56,866			8,504			8,681			11,892
Total Leases Subject to Comparison (square feet)	94,125			74,199			31,764			85,438			35,703

New Leases/Expansions:
Expiring Cash Rental Rate	$	21.38		$	17.73		$	16.97		$	10.54		$	14.32
Initial Cash Rental Rate	$	20.21		$	21.61		$	18.60		$	15.42		$	21.27
Increase (decrease) %	(5.5		)%	21.9		%	9.6		%	46.3		%	48.5		%

Expiring GAAP Rental Rate	$	19.82		$	16.66		$	16.11		$	9.89		$	13.25
New GAAP Rental Rate	$	21.84		$	22.36		$	21.28		$	12.75		$	21.62
Increase (decrease) %	10.2		%	34.2		%	32.1		%	28.9		%	63.2		%

Renewals of Existing Leased Space:
Expiring Cash Rental Rate	$	16.63		$	14.91		$	15.71		$	25.46		$	16.74
Initial Cash Rental Rate	$	21.60		$	15.36		$	20.71		$	27.18		$	17.72
Increase (decrease) %	29.9		%	3.0		%	31.8		%	6.8		%	5.9		%

Expiring GAAP Rental Rate	$	15.75		$	13.88		$	14.15		$	19.10		$	16.01
New GAAP Rental Rate	$	22.45		$	16.61		$	24.23		$	16.96		$	17.80
Increase (decrease) %	42.5		%	19.7		%	71.2		%	(11.2		)%	11.2		%

Combined:
Expiring Cash Rental Rate	$	19.71		$	15.56		$	16.64		$	12.06		$	15.21
Initial Cash Rental Rate	$	20.69		$	16.82		$	19.17		$	16.61		$	20.09
Increase (decrease) %	5.0		%	8.1		%	15.2		%	37.7		%	32.1		%

Expiring GAAP Rental Rate	$	18.39		$	14.52		$	15.59		$	10.82		$	14.27
New GAAP Rental Rate	$	22.05		$	17.95		$	22.07		$	13.18		$	20.35
Increase (decrease) %	19.9		%	23.6		%	41.6		%	21.8		%	42.6		%

(1) Includes tenant improvements and leasing commissions.

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

($ in thousands except for average amounts)

Our Development Properties



								TPGI Share as of
						Entitlements		September 30, 2012
	Location	TPGI Percentage Interest		Number of Acres	Potential Property Types	Square Feet	Status	Costs Incurred to Date		Average Cost Per Square Foot			Loan Balance
Pre-Development
Campus El Segundo (1)	El Segundo, CA	100	%	23.9	Office/ Retail/ R&D/ Hotel	1,700,000	Entitled	$	57,171	$	33.63		$	14,500
Four Points Centre (2)	Austin, TX	100		250.0	Office/ Retail/ R&D/ Hotel	1,680,000	Entitled	18,340		10.92			—
2100 JFK Boulevard	Philadelphia, PA	100		0.7	Office/ Retail/ R&D/ Hotel	366,000	Entitled	4,928		13.46			—
CityWestPlace land (2)	Houston, TX	25		24.1	Office/ Retail/ Residential	1,500,000	Entitled	5,372		14.33		(3)	—
						5,246,000		$	85,811	$	19.43		$	14,500

Condominium Units Held for Sale

As of September 30, 2012

Location

TPGI Percentage Interest (4)

Description

Number of Units Sold To Date

Total Square Feet Sold To Date

Average Sales Price Per Square Foot Sold To Date

Number of Units Remaining To Be Sold (5)

Total Square Feet Remaining To Be Sold

List Price Per Square Foot to Be Sold (6)

Book Carrying Value

Loan Balance

Murano

Philadelphia, PA

73%

43-story for-sale condominium project containing 302 units. Certificates of occupancy received for 100% of units

245

272,953

516

78,372

$498 to $1,254

42,332

11,925


(1)	The 23.9 acres at Campus El Segundo have been listed with a broker to be sold.


(2)	Certain parcels are being targeted for sale.


(3)	Average cost per square foot on City West Place land is based on total costs incurred to date of $21.5 million, including TPGI's share of $5.4 million.


(4)	After full repayment of the Murano construction loan, which has a balance of $11.9 million at September 30, 2012, net proceeds from the project will be distributed, to the extent available, as follows:


i.	First, to TPGI as repayment of our first priority capital and a return on such capital, which has a balance of $14.8 million as of September 30, 2012;


ii.	Second, to TPGI and our partner equally for repayment of second priority capital and a return on such capital. TPGI's share of this tranche is $1.6 million as of September 30, 2012;


iii.	Third, the next $3.0 million to be split equally between TPGI and our partner;


iv.	Fourth, to TPGI for repayment of our original preferred equity contribution and a return on such capital, which has a balance of $31.0 million as of September 30, 2012;


v.	Fifth, the next $3.0 million to be split equally between TPGI and our partner; and


vi.	Sixth, to TPGI for repayment of the final half of the original preferred equity contribution, which has a balance of $8.2 million as of September 30, 2012; and


vii.	Any residual amounts will be allocated to TPGI and our partner 73% and 27%, respectively.


(5)	Of the 57 units remaining to sell as of September 30, 2012, 53 units are on high-rise floors with superior views. Subsequent to September 30, 2012, we entered into a contract for sale for one additional unit. This contract is subject to a buyer rescission period.


(6)	The average list price per square foot is $694.

Thomas Properties Group, Inc.

Supplemental Financial Information

PORTFOLIO DATA - CONTINUED

Our Managed Properties

We provide leasing, asset and/or property management services on behalf of third parties for the following properties:



Managed Properties	Location	Rentable Square Feet	Percent Leased		Managed by TPG Since
800 South Hope Street	Los Angeles, CA	242,176	98.5	%	2000
CalEPA Headquarters	Sacramento, CA	950,939	100.0		2000
1835 Market Street	Philadelphia, PA	686,503	86.3		2002
816 Congress	Austin, TX	433,024	73.3		2011
Austin Centre	Austin, TX	326,335	75.8		2011
Total/Weighted Average		2,638,977	88.9	%

Thomas Properties Group, Inc.

Supplemental Financial Information

DEBT SUMMARY

(in thousands)



	As of September 30, 2012
Mortgages and Other Loans	Interest Rate		Principal Amount		TPGI Share of Principal Amount		Maturity Date	Maturity Date at End of Extension Options
2013 Maturity Date at End of Extension Options
Two Commerce Square	6.3		$	106,737	$	106,737	5/9/2013	5/9/2013
Murano mortgage loan (1)	4.0		11,925		11,925		12/15/2013	12/15/2013
Subtotal - 2013 maturities			118,662		118,662
2014 Maturity Date at End of Extension Options
Campus El Segundo (2)	4.0		14,500		14,500		10/31/2012	10/31/2014
Subtotal - 2014 maturities			14,500		14,500
2015 Maturity Date at End of Extension Options
Reflections I	5.2		20,635		5,159		4/1/2015	4/1/2015
Reflections II	5.2		8,596		2,149		4/1/2015	4/1/2015
Four Points Centre (3)	3.8		24,500		24,500		7/31/2014	7/31/2015
Subtotal - 2015 maturities			53,731		31,808
2016 and Thereafter- Maturity Date at End of Extension Options
City National Plaza - note payable to former partner	5.8		500		40		1/4/2016	1/4/2016
One Commerce Square	5.7		127,303		127,303		1/6/2016	1/6/2016
CityWestPlace (Buildings I & II)	6.2		119,478		29,870		7/6/2016	7/6/2016
Fair Oaks Plaza	5.5		44,300		11,075		2/9/2017	2/9/2017
Frost Bank Tower	6.1		150,000		50,002		6/11/2017	6/11/2017
One Congress Plaza	6.1		128,000		42,669		6/11/2017	6/11/2017
300 West 6th Street	6.0		127,000		42,335		6/11/2017	6/11/2017
One American Center	6.0		120,000		40,002		6/11/2017	6/11/2017
San Jacinto Center	6.0		101,000		33,668		6/11/2017	6/11/2017
San Felipe Plaza	4.8		110,000		27,500		12/1/2018	12/1/2018
CityWestPlace (Buildings III & IV)	5.0		95,000		23,750		3/5/2020	3/5/2020
City National Plaza - senior mortgage loan	5.9		350,000		27,781		7/1/2020	7/1/2020
2121 Market Street (4)	6.1		17,526		8,763		8/1/2033	8/1/2033
Subtotal - 2016 and thereafter maturities			1,490,107		464,758
Total			$	1,677,000	$	629,728
Weighted average interest rate at September 30, 2012	5.8	%

Footnotes on following page.

Thomas Properties Group, Inc.

Supplemental Financial Information

DEBT SUMMARY - CONTINUED

Footnotes to Debt Summary on previous page:

In connection with some of the loans listed in the Debt Summary, our operating partnership is subject to customary non-recourse carve out obligations, in the case of consolidated assets; and TPG/CalSTRS is subject to customary non-recourse carve out obligations in the case of certain joint venture assets.

(1)

The Murano loan bears interest at the one-month LIBOR plus 3.75% and matures on December 15, 2013. On December 31, 2012, and June 30, 2013, the loan is subject to a maximum balance of $8.6 million and $4.3 million, respectively. TPG gave the lender a limited guaranty which (i) guarantees repayment of the loan in the event of certain bankruptcy events affecting the borrower, (ii) guarantees payment of the lender's damages from customary “bad boy” actions of the borrower or TPG (such as fraud, physical waste of the property, misappropriation of funds and similar bad acts); and (iii) guarantees payment of the amount, if any, by which the loan balance at the time exceeds 80% of the bulk sale value of the collateral upon an acceleration of the loan triggered by a borrower default.

(2)

The Campus El Segundo mortgage loan has an October 31, 2012 maturity date with two remaining twelve month extensions. The lender and borrower have agreed to terms to extend and modify the loan, and are currently in process of documenting such modification. The modification will include a deferral of a $2.5 million principal pay down, which was to have been made on October 31, 2012, to April 30, 2013. While this documentation is pending, the lender has agreed to extend the maturity date to November 30, 2012. We have guaranteed this loan.

(3)

The Four Points Centre loan bears interest at LIBOR plus 3.50%. As of September 30, 2012, $6.2 million is available to be drawn to fund tenant improvement costs and certain other project costs related to two office buildings. The loan has a one-year extension option at our election subject to certain conditions. The option to extend is subject to a 62.5% loan-to-value ratio and a minimum appraised land ratio of 65.0% and the adjusted net operating income of the property and improvements as a percentage of the outstanding principal balance must be at least 10.0%. If the loan-to-value ratio or the minimum debt yield is not met, we can pay down the principal balance in an amount sufficient to satisfy the requirement. The debt yield is calculated by dividing the net operating income of the property by the outstanding principal balance of the loan. Beginning in August, 2014, we are required to pay down the loan balance by $42,000 each month. As of September 30, 2012, the property had a net operating loss. We have guaranteed completion of the tenant improvements and 46.5% of the balance of the outstanding principal balance and interest payable on the loan, which results in a maximum guarantee of $11.4 million as of September 30, 2012. We have agreed to certain financial covenants on this loan as the guarantor, which we were in compliance with as of September 30, 2012. We have also provided additional collateral of approximately 62.4 acres of fully entitled unimproved land, which is immediately adjacent to the office buildings.


(4)	The loan is guaranteed by our operating partnership and our co-general partner in the partnership that owns 2121 Market Street, up to a maximum amount of $3.3 million.

Thomas Properties Group, Inc.

Supplemental Financial Information

CAPITAL STRUCTURE

(in thousands, except share data)

The following is the capital structure of TPGI as of September 30, 2012:



Debt		Aggregate Principal
Mortgage loans		$	284,965
Company share of unconsolidated debt		344,750
Total combined debt		$	629,715

Equity	Shares/Units Outstanding	Market Value (1)
Common stock	46,100,229	$	268,303
Operating partnership units (2)	12,563,683	73,121
Total common equity	58,663,912	$	341,424
Total consolidated market capitalization		$	626,389
Total combined market capitalization (3)		$	971,139


(1)	Based on the closing price of $5.82 per share of TPGI common stock on September 30, 2012.


(2)	Includes operating partnership units and both vested and unvested incentive units as of September 30, 2012.


(3)	Includes TPGI's share of debt of unconsolidated real estate entities.

Thomas Properties Group, Inc.

Supplemental Financial Information

OTHER INFORMATION

Principal Corporate Office

Thomas Properties Group, Inc.

515 South Flower Street

Sixth Floor

Los Angeles, CA 90071

Phone: (213) 613-1900

Fax: (213) 633-4760

www.tpgre.com

The information contained on our website is not incorporated herein by reference and does not constitute a part of this supplemental financial information.



Investor Relations	Transfer Agent and Registrar	Stock Market Listing
Diana M. Laing	Computershare Trust Company	NASDAQ: TPGI
Chief Financial Officer	P.O. Box 43078
515 South Flower Street	Providence, RI 02940-3078
Sixth Floor	Phone: (781) 575-2879
Los Angeles, CA 90071
Phone: (213) 613-1900
E-mail: dlaing@tpgre.com

Board of Directors and Executive Officers



James A. Thomas		Chairman, President and CEO
John R. Sischo		Co-Chief Operating Officer and Director
Paul S. Rutter		Co-Chief Operating Officer and General Counsel
Randall L. Scott		Executive Vice President and Director
Thomas S. Ricci		Executive Vice President
Diana M. Laing		Chief Financial Officer and Secretary
Todd L. Merkle		Chief Investment Officer
Robert D. Morgan		Senior Vice President, Accounting and Administration
R. Bruce Andrews		Director
Bradley H. Carroll		Director
Edward D. Fox		Director
John L. Goolsby		Director
Winston H. Hickox		Director

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THOMAS PROPERTIES GROUP INC Reports