UNITED STATES |
SECURITIES AND EXCHANGE COMMISSION |
Washington, D.C. 20549 |
FORM 8-K/A |
(Amendment No. 3)
CURRENT REPORT |
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Date of Report (Date of earliest event reported): August 18, 2015 |
Cole Office & Industrial REIT (CCIT II), Inc. | |||||||||
(Exact Name of Registrant as Specified in Its Charter) | |||||||||
Maryland | 000-55436 | 46-2218486 | |||||||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | |||||||
2325 East Camelback Road, Suite 1100, Phoenix, Arizona 85016 | |||||||||
(Address of principal executive offices) | |||||||||
(Zip Code) | |||||||||
(602) 778-8700 | |||||||||
(Registrant’s telephone number, including area code) | |||||||||
None | |||||||||
(Former name or former address, if changed since last report) | |||||||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Explanatory Note
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, Cole Office & Industrial REIT (CCIT II), Inc. (which may be referred to as the “Company,” “we,” “our,” and “us”) hereby amends the Current Report on Form 8-K filed on August 24, 2015, as previously amended by the Current Report on Form 8-K/A filed on October 13, 2015 and the Current Report on form 8-K/A filed on March 8, 2016, to provide the financial information required by Item 9.01 relating to our acquisition of an office building totaling 280,560 square feet located in Burlington, Massachusetts (the “Property”). The Company purchased the Property on August 18, 2015 for $119.8 million. The Property was constructed in 2014 and is 100% leased to Keurig Green Mountain, Inc. under a lease that commenced on June 30, 2014.
An unaudited pro forma consolidated balance sheet is not presented because the acquisition of the Property was reflected in the Company's condensed consolidated balance sheet as of December 31, 2015. The unaudited pro forma consolidated statement of operations assumes that the acquisition of the Property occurred on June 30, 2014, the date construction was complete and rent commenced. The unaudited pro forma adjustments are based on available information and certain estimates and assumptions that the Company believes are reasonable and factually supportable. The unaudited pro forma consolidated statement of operations is not necessarily indicative of what actual results of operations would have been had the Company made this acquisition on June 30, 2014, nor does it purport to represent the results of operations for future periods.
Item 9.01 Financial Statements and Exhibits
(a) Financial Statements of the Property Acquired | |
None | |
(b) Pro Forma Financial Information | |
(c) Shell Company Transactions | |
None | |
(d) Exhibits | |
None | |
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COLE OFFICE & INDUSTRIAL REIT (CCIT II), INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
For the Year Ended December 31, 2015
(in thousands, except share and per share amounts)
The following Pro Forma Condensed Consolidated Statement of Operations (Unaudited) is presented as if the Company had acquired the Property on June 30, 2014, the date that construction of the Property was completed.
This Pro Forma Condensed Consolidated Statement of Operations (Unaudited) should be read in conjunction with the Company’s historical financial statements and notes thereto for the year ended December 31, 2015, as presented in its Annual Report on Form 10-K filed with the SEC on March 29, 2016. This Pro Forma Condensed Consolidated Statement of Operations (Unaudited) is not necessarily indicative of what the Company’s actual results of operations would have been had it completed the above acquisition on June 30, 2014, nor does it purport to represent its future operations. This Pro Forma Condensed Consolidated Statement of Operations (Unaudited) only includes the impact of the acquisition of the Property, which is considered to be a significant property acquisition pursuant to Rule 3-14 of Regulation S-X.
For the Year Ended December 31, 2015 As Reported | Acquisition Pro Forma Adjustments | Pro Forma for the Year Ended December 31, 2015 | ||||||||||
(a) | ||||||||||||
Revenues: | ||||||||||||
Rental and other property income | $ | 55,415 | $ | 5,366 | (b) | $ | 60,781 | |||||
Tenant reimbursement income | 5,833 | 306 | (c) | 6,139 | ||||||||
Assignment fee income | 12,767 | — | 12,767 | |||||||||
Total revenues | 74,015 | 5,672 | 79,687 | |||||||||
Operating expenses: | ||||||||||||
General and administrative | 4,126 | 89 | (d) | 4,215 | ||||||||
Property operating | 3,432 | 21 | (e) | 3,453 | ||||||||
Real estate tax | 4,694 | 285 | (e) | 4,979 | ||||||||
Advisory fees and expenses | 5,929 | 566 | (f) | 6,495 | ||||||||
Acquisition-related | 7,561 | — | 7,561 | |||||||||
Depreciation and amortization | 23,380 | 2,288 | (g) | 25,668 | ||||||||
Total operating expenses | 49,122 | 3,249 | 52,371 | |||||||||
Operating income | 24,893 | 2,423 | 27,316 | |||||||||
Other income (expense): | ||||||||||||
Interest expense and other, net | (18,053 | ) | (2,645 | ) | (h) | (20,698 | ) | |||||
Net income | $ | 6,840 | $ | (222 | ) | $ | 6,618 | |||||
Weighted average number of common shares outstanding: | ||||||||||||
Basic and diluted | 31,204,356 | 681,004 | (i) | 31,885,360 | ||||||||
Net income per common share: | ||||||||||||
Basic and diluted | $ | 0.22 | $ | 0.21 | ||||||||
See accompanying Notes to Pro Forma Condensed Consolidated Financial Statements (Unaudited).
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COLE OFFICE & INDUSTRIAL REIT (CCIT II), INC.
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
December 31, 2015
Notes to Pro Forma Condensed Consolidated Statement of Operations (Unaudited) for the Year Ended December 31, 2015
a. Reflects the Company’s historical condensed consolidated results of operations for the year ended December 31, 2015.
b. Represents the straight-line rental revenue in accordance with the lease agreement of the Property. Rental revenue at the Property commenced on June 30, 2014.
c. Reflects the tenant reimbursement income for the Property based on historical operating results of the Property.
d. Reflects management’s estimate of the general and administrative expenses based on the Company’s historical results.
e. Reflects the property operating and real estate tax expenses based on historical operating results of the Property.
f. Represents the advisory fee paid to an affiliate, which is calculated based on an annualized rate of 0.75% of the Company’s average invested assets. The advisory fee was calculated based on the purchase price of the Property of $119.8 million.
g. Represents depreciation and amortization expenses for the Property. Depreciation and amortization expenses are based on the Company’s purchase price allocation. Real estate and related assets, other than land, are depreciated or amortized on a straight-line basis. The estimated useful lives of the Company’s real estate and related assets by class are generally as follows:
Buildings | 40 years | |
Tenant improvements | Lesser of useful life or lease term | |
Intangible lease assets | Lease term | |
h. Represents interest expense associated with borrowings on the secured revolving credit facility with JPMorgan Chase Bank, N.A., as administrative agent (the “Amended Credit Facility”), as well as interest expense associated with a note payable. Assumes the Company financed the original purchase of the Property with the Amended Credit Facility, and shortly thereafter partially paid down the Amended Credit Facility borrowings related to the Property by obtaining separate financing through a note payable.
i. Represents the additional weighted average common shares that would have been required to have been issued in order to generate sufficient offering proceeds to fund the purchase of the Property, assuming a purchase date of June 30, 2014, through the actual purchase date of August 18, 2015.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: April 14, 2016 | COLE OFFICE & INDUSTRIAL REIT (CCIT II), INC. | |
By: | /s/ Simon J. Misselbrook | |
Name: | Simon J. Misselbrook | |
Title: | Chief Financial Officer and Treasurer | |
(Principal Financial Officer) | ||
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