PS BUSINESS PARKS, INC./MD - FORM 8-K - EX-99.2

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EX-99.1 - EX-99.1 - PS BUSINESS PARKS, INC./MD	d905641dex991.htm
8-K - FORM 8-K - PS BUSINESS PARKS, INC./MD	d905641d8k.htm

Exhibit 99.2

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SUPPLEMENTAL INFORMATION

FIRST QUARTER 2020

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701 WESTERN AVENUE | GLENDALE, CA 91201 | 818.244.8080 | PSBUSINESSPARKS.COM

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ANALYSIS OF OPERATING RESULTS AND FINANCIAL CONDITION FOR

THE THREE MONTHS ENDED MARCH 31, 2020


		Page

Consolidated Balance Sheets		4

Consolidated Statements of Income		6

Portfolio Summary		8

First Quarter Fact Sheet		9

Same Park Cash NOI by Region and Type		10

Analysis of Capital Expenditures		11

Funds from Operations (FFO), Core FFO and Funds Available for Distribution (FAD)		12

Capital Structure and Financial Condition		14

Portfolio Operating Analysis and Statistics		15

Lease Expirations		22

First Quarter 2020 Production Statistics		26

Forward-Looking Statement

When used within this supplemental information package, the words “may,” “believes,” “anticipates,” “plans,” “expects,” “seeks,” “estimates,” “intends” and similar expressions are intended to identify “forward-looking statements.” Such forward-looking statements involve known and unknown risks, uncertainties, and other factors, which may cause the actual results and performance of the Company to be materially different from those expressed or implied in the forward-looking statements. Such factors include the length and severity of the COVID-19 pandemic and its impact on our business, the impact of competition from new and existing commercial facilities which could impact rents and occupancy levels at the Company’s facilities; the Company’s ability to evaluate, finance, and integrate acquired and developed properties into the Company’s existing operations; the Company’s ability to effectively compete in the markets that it does business in; the impact of the regulatory environment as well as national, state and local laws and regulations including, without limitation, those governing REITs; the impact of general economic and business conditions, including in connection with the COVID-19 pandemic; rental rates and occupancy levels at the Company’s facilities; and changes in these conditions as a result of the COVID-19 pandemic, the availability of permanent capital at attractive rates, the outlook and actions of rating agencies and risks detailed from time to time in the Company’s SEC reports, including quarterly reports on Form 10-Q, reports on Form 8-K, and annual reports on Form 10-K.

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Provided within this supplemental information package are measures not defined in accordance with U.S. generally accepted accounting principles (“GAAP”). We believe our presentation of these non-GAAP measures assists investors and analysts in analyzing and comparing our operating and financial performance between reporting periods. These non-GAAP measures discussed below are not substitutes of other measures of financial performance presented in accordance with GAAP. In addition, other real estate investment trusts (“REITs”) may compute these measures differently, so comparisons among REITs may not be helpful.

Adjusted Cost of Operations – Adjusted cost of operations represents cost of operations, excluding non-cash stock compensation expense for employees whose compensation expense is recorded in cost of operations, which can vary significantly period to period based upon the performance of the company. The GAAP measure most directly comparable to adjusted cost of operations is cost of operations.

Cash NOI – We utilized cash NOI to evaluate the cash flow performance of our business parks. Cash NOI represents NOI adjusted to exclude non-cash items included in revenue and in cost of operations. The non-cash revenue includes straight-line rent, amortization of above and below market rents, net, and amortization of lease incentives and tenant improvement reimbursements. The non-cash expenses are equal to stock compensation expense for employees whose compensation expense is recorded in cost of operations. We believe that cash NOI assists investors in analyzing cash flow performance of our business parks. The GAAP measure most directly comparable to cash NOI is net income.

Core FFO and Core FFO per share – Core FFO represents FFO excluding the net impact of (i) income allocated to preferred shareholders to the extent redemption value exceeds the related carrying value and (ii) other nonrecurring income or expense items as appropriate. Core FFO per share represents Core FFO allocable to diluted shares and units divided by the weighted average diluted shares and units. We believe our presentation of Core FFO and Core FFO per share assists investors and analysts in analyzing and comparing our operating and financial performance between reporting periods. The GAAP measures most directly comparable to Core FFO and Core FFO per share are net income and earnings per share, respectively.

Earnings before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”) – EBITDAre is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and is often utilized to evaluate the performance of real estate companies. EBITDAre is calculated as GAAP net income before interest, depreciation and amortization and adjusted to exclude gains or losses from sales of depreciable real estate assets and impairment charges on real estate assets. We believe our presentation of EBITDAre assists investors and analysts in evaluating the operating performance of our business activities, including the impact of general and administrative expenses, and without the impact from gains or losses from sales of depreciable real estate assets. The GAAP measure most directly comparable EBITDAre is net income.

Free Cash Available after Fixed Charges – Free cash available after fixed charges represents FAD less dividends and distributions.

Funds Available for Distribution (“FAD”) – FAD is a non-GAAP measure that represents Core FFO adjusted to (a) deduct recurring capital improvements that maintains the condition of our real estate, tenant improvements and lease commissions and (b) remove certain non-cash revenue or expenses such as straight-line rent and non-cash stock compensation expense. We believe our presentation of FAD assists investors and analysts in analyzing and comparing our operating and financial performance between reporting periods. FAD is not a substitute for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because they exclude investing and financing activities presented on our statements of cash flows. The GAAP measure most directly comparable to FAD is operating cash flow from our statements of cash flows.

Funds from Operations (“FFO”) and FFO per share – FFO and FFO per share are non-GAAP measures defined by NAREIT and are considered helpful measures of REIT performance by REITs and many REIT analysts. FFO represents GAAP net income before real estate depreciation and amortization expense, gains or losses on sales of operating properties and land and impairment charges on real estate assets, which are excluded because it does not accurately reflect changes in the value of our business parks. FFO per share represents FFO allocable to diluted shares and units, divided by aggregate diluted shares and units. The GAAP measure most directly comparable to FFO and FFO per share are net income and earnings per share, respectively.

Net Operating Income (“NOI”) – We utilize NOI, a non-GAAP financial measure, to evaluate the operating performance of our business parks. We define NOI as rental income less adjusted cost of operations (described below). We believe NOI assists investors in analyzing the performance and value of our business parks by excluding (i) corporate overhead (i.e. general and administrative expenses) because it does not relate to the results of our business parks, (ii) depreciation and amortization expense because it does not accurately reflect changes in the fair value of our business parks and (iii) stock compensation expense because this expense item can vary significantly from period to period and thus impact comparability across periods. The GAAP measure most directly comparable to NOI is net income.

Retained Cash – Retain cash represents free cash available after fixed charges less (i) non-recurring property renovations and funds used for development and redevelopment.

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	March 31, 2020		December 31, 2019
ASSETS

Cash and cash equivalents	$	87,874	$	62,786	(a)

Real estate facilities, at cost
Land		857,758		846,635
Buildings and improvements		2,214,861		2,206,134

		3,072,619		3,052,769
Accumulated depreciation		(1,181,660)		(1,159,769)

		1,890,959		1,893,000	(b)
Properties held for sale, net ⁽¹⁾		-		11,502
Land and building held for development, net		26,216		28,110

		1,917,175		1,932,612

Rent receivable		2,903		1,392	(c)
Deferred rent receivable		33,747		32,993
Other assets		12,317		16,660	(d)

Total assets	$	2,054,016	$	2,046,443


LIABILITIES AND EQUITY

Accrued and other liabilities	$	78,644	$	84,632	(e)

Total liabilities		78,644		84,632

Equity
PS Business Parks, Inc.’s shareholders’ equity:
Preferred stock		944,750		944,750
Common stock		274		274
Paid-in capital		734,091		736,986	(f)
Accumulated earnings		76,739		63,666	(g)

Total PS Business Parks, Inc.’s shareholders’ equity		1,755,854		1,745,676
Noncontrolling interests		219,518		216,135

Total equity		1,975,372		1,961,811

Total liabilities and equity	$	2,054,016	$	2,046,443

See following page for additional detail related to the tickmarks shown in the table above.

⁽¹⁾

On January 7, 2020, the Company completed the sale of a one single-tenant government building totaling 113,000 square feet at Metro Park North located in Montgomery County, Maryland, for a gross sales price of $30.0 million. This building represents the entirety of the properties held for sale, net as of December 31, 2019.

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(a)	Change in cash and cash equivalents
	Beginning cash balance at December 31, 2019					$	62,786
	Net cash provided by operating activities						70,007
	Net cash provided by investing activities						7,587
	Net cash used in financing activities						(52,506)

	Ending cash balance at March 31, 2020					$	87,874


(b)	Change in real estate facilities
	Beginning balance at December 31, 2019					$	1,893,000
	Acquisition of real estate						13,276
	Recurring capital improvements						1,223
	Tenant improvements, gross						3,549
	Capitalized lease commissions						2,082
	Nonrecurring capital improvements						93
	Depreciation and amortization						(22,248)
	Transfer to properties held for sale						(16)

	Ending balance at March 31, 2020					$	1,890,959


						Increase
(c)	Change in rent receivable	March 31, 2020		December 31, 2019		(Decrease)
	Non-government customers ⁽¹⁾	$	2,182	$	597	$	1,585
	U.S. Government customers		721		795		(74)

		$	2,903	$	1,392	$	1,511


						Increase
(d)	Change in other assets	March 31, 2020		December 31, 2019		(Decrease)
	Lease intangible assets, net	$	8,844	$	9,973	$	(1,129)
	Prepaid property taxes and insurance		1,031		2,572		(1,541)
	Other		2,442		4,115		(1,673)

		$	12,317	$	16,660	$	(4,343)


						Increase
(e)	Change in accrued and other liabilities	March 31, 2020		December 31, 2019		(Decrease)
	Customer security deposits	$	38,329	$	39,118	$	(789)
	Accrued property taxes		12,958		11,521		1,437
	Customer prepaid rent		11,265		14,519		(3,254)
	Lease intangible liabilities, net		7,267		8,541		(1,274)
	Other		8,825		10,933		(2,108)

		$	78,644	$	84,632	$	(5,988)


(f)	Change in paid-in capital
	Beginning paid-in capital					$	736,986
	Stock compensation expense, net						760
	Cash paid for taxes in lieu of shares upon vesting of restricted stock units						(3,655)

	Ending paid in capital					$	734,091


(g)	Change in accumulated earnings
	Beginning accumulated earnings					$	63,666
	Net income						53,936
	Distributions to preferred shareholders						(12,046)
	Distributions to common shareholders						(28,817)

	Ending accumulated earnings					$	76,739

⁽¹⁾	Included in the balance at March 31, 2020 is $1.6 million of prior year expense recovery billings and for comparative purposes this balance was $1.7 million as of March 31, 2019.

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	For The Three Months
	Ended March 31,
	2020		2019
Rental income	$	106,216	$	107,825	(a)

Expenses
Cost of operations		31,263		33,593	(b)
Depreciation and amortization		26,619		24,875
General and administrative		3,323		3,233	(c)

Total operating expenses		61,205		61,701


Interest and other income		557		618	(d)
Interest and other expense		(161)		(167)	(e)
Gain on sale of real estate facility		19,621		-

Net income		65,028		46,575
Allocation to noncontrolling interests		(11,092)		(7,027)

Net income allocable to PS Business Parks, Inc.		53,936		39,548
Allocation to preferred shareholders		(12,046)		(12,959)
Allocation to restricted stock unit holders		(275)		(268)

Net income allocable to common shareholders	$	41,615	$	26,321


Net income per common share
Basic	$	1.52	$	0.96
Diluted	$	1.51	$	0.96

Weighted average common shares outstanding
Basic		27,448		27,373
Diluted		27,550		27,479

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		For The Three Months Ended				Increase
(a)	Rental income:	March 31, 2020		March 31, 2019		(Decrease)
	Same Park	$	97,170	$	94,196	$	2,974
	Same Park non-cash revenue ⁽¹⁾		802		617		185
	Non-Same Park		5,357		2,318		3,039
	Non-Same Park non-cash revenue ⁽¹⁾		261		163		98
	Multifamily		2,559		2,497		62
	Multifamily non-cash revenue ⁽¹⁾		1		1		-
	Revenue from assets sold ⁽²⁾		66		8,033		(7,967)

		$	106,216	$	107,825	$	(1,609)


		For The Three Months Ended				Increase
(b)	Cost of operations:	March 31, 2020		March 31, 2019		(Decrease)
	Same Park	$	28,178	$	28,177	$	1
	Same Park non-cash expenses ⁽³⁾		255		276		(21)
	Non-Same Park		1,782		1,143		639
	Non-Same Park non-cash expenses ⁽³⁾		19		13		6
	Multifamily		1,016		1,071		(55)
	Expenses from assets sold ⁽²⁾		13		2,913		(2,900)

		$	31,263	$	33,593	$	(2,330)


		For The Three Months Ended				Increase
(c)	General and administrative expenses:	March 31, 2020		March 31, 2019		(Decrease)
	Compensation expense	$	1,753	$	1,683	$	70
	Stock compensation expense		668		665		3
	Professional fees and other		902		885		17

		$	3,323	$	3,233	$	90


		For The Three Months Ended				Increase
(d)	Interest and other income:	March 31, 2020		March 31, 2019		(Decrease)
	Management fee income	$	70	$	78	$	(8)
	Interest income		303		326		(23)
	Other income		184		214		(30)

		$	557	$	618	$	(61)


		For The Three Months Ended				Increase
(e)	Interest and other expense:	March 31, 2020		March 31, 2019		(Decrease)
	Interest expense	$	-	$	-	$	-
	Credit facilities fees & other charges		(161)		(167)		(6)

		$	(161)	$	(167)	$	(6)

⁽¹⁾	Non-cash revenue represents straight-line rent, amortization of above and below market rents, net, and amortization of lease incentives and tenant improvement reimbursements.

⁽²⁾

Amounts for the three months ended March 31, 2020 reflect the operating results related to a 113,000 square foot office building sold in 2020; amounts for the three months ended March 31, 2019 reflect the operating results related to a 113,000 square foot office building sold in 2020 and 1.3 million square feet of assets sold in 2019.

⁽³⁾	Non-cash expenses represent stock compensation expense attributable to employees whose compensation expense is recorded in costs of operations.

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PROPERTY INFORMATION ⁽¹⁾

	For The Three Months Ended March 31,
	2020		2019		% Change
Total Portfolio⁽²⁾
Total rentable square footage at period end		27,522,000		26,753,000		2.9%
Weighted average occupancy		92.9%		94.1%		(1.3%)
Period end occupancy		92.6%		94.1%		(1.6%)
Annualized realized rent per occupied sq. ft.^(3) (5)	$	16.20	$	15.46		4.8%
RevPAF^{(4) (5)}	$	15.06	$	14.55		3.5%

Same Park Portfolio ⁽⁶⁾
Total rentable square footage at period end		25,696,000		25,696,000		-
Weighted average occupancy		92.9%		94.7%		(1.9%)
Period end occupancy		92.5%		94.7%		(2.3%)
Annualized realized rent per occupied sq. ft.^(3) (5)	$	16.42	$	15.58		5.4%
RevPAF^{(4) (5)}	$	15.25	$	14.76		3.3%

Non-Same Park Portfolio ⁽⁷⁾
Total rentable square footage at period end		1,826,000		1,057,000		72.8%
Weighted average occupancy		93.3%		78.6%		18.7%
Period end occupancy		93.6%		79.9%		17.1%
Annualized realized rent per occupied sq. ft.⁽³⁾	$	13.24	$	11.94		10.9%
RevPAF ⁽⁴⁾	$	12.35	$	9.39		31.5%

Multifamily Portfolio
Number of units		395		395		-
Weighted average occupancy		94.9%		95.1%		(0.2%)
Period end occupancy		94.1%		94.9%		(0.8%)

⁽¹⁾	Excludes a 113,000 square foot office building sold in 2020 and 1.3 million rentable square feet of assets sold in 2019.

⁽²⁾	Operating metrics from our multifamily asset are excluded from the total portfolio operating metrics.

⁽³⁾	Annualized realized rent per occupied square foot represents the annualized GAAP revenue earned per occupied square foot.

⁽⁴⁾	RevPAF represents the annualized GAAP revenue earned per total weighted average available square foot.

⁽⁵⁾	Total and Same Park annualized realized rent per occupied square foot and RevPAF include lease buyout income of $278,000 and $177,000 for the three months ended March 31, 2020 and 2019, respectively.

⁽⁶⁾	Same Park includes assets acquired prior to January 1, 2018.

⁽⁷⁾	Non-Same Park reflects assets acquired on or subsequent to January 1, 2018.

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NET OPERATING INCOME


	For The Three Months Ended March 31,
	2020		2019		% Change
Rental income
Same Park ^{(1) (2)}	$	97,972	$	94,813		3.3%
Non-Same Park ⁽³⁾		5,618		2,481		126.4%
Multifamily		2,560		2,498		2.5%
Assets sold		66		8,033		(99.2%)

Total rental income		106,216		107,825		(1.5%)

Adjusted cost of operations ⁽⁴⁾
Same Park ^{(1) (5)}		28,178		28,177		0.0%
Non-Same Park ⁽³⁾		1,782		1,143		55.9%
Multifamily		1,016		1,071		(5.1%)
Assets sold		13		2,896		(99.6%)

Total		30,989		33,287		(6.9%)

Net operating income
Same Park ⁽¹⁾		69,794		66,636		4.7%
Non-Same Park ⁽³⁾		3,836		1,338		186.7%
Multifamily		1,544		1,427		8.2%
Assets sold ⁽⁶⁾		53		5,137		(99.0%)

Total net operating income	$	75,227	$	74,538		0.9%


CASH NET OPERATING INCOME

	For The Three Months Ended March 31,
	2020		2019		% Change
Cash rental income ⁽⁷⁾
Same Park ^{(1) (2)}	$	97,170	$	94,196		3.2%
Non-Same Park ⁽³⁾		5,357		2,318		131.1%
Multifamily		2,559		2,497		2.5%
Assets sold		66		7,801		(99.2%)

Total cash rental income		105,152		106,812		(1.6%)

Adjusted cost of operations ⁽⁴⁾
Same Park ^{(1) (5)}		28,178		28,177		0.0%
Non-Same Park ⁽³⁾		1,782		1,143		55.9%
Multifamily		1,016		1,071		(5.1%)
Assets sold		13		2,896		(99.6%)

Total adjusted cost of operations		30,989		33,287		(6.9%)

Cash net operating income
Same Park ⁽¹⁾		68,992		66,019		4.5%
Non-Same Park ⁽³⁾		3,575		1,175		204.3%
Multifamily		1,543		1,426		8.2%
Assets sold ⁽⁶⁾		53		4,905		(98.9%)

Total cash net operating income	$	74,163	$	73,525		0.9%


EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION FOR REAL ESTATE (EBITDAre)

	For The Three Months Ended March 31,
	2020		2019		% Change
Net income	$	65,028	$	46,575		39.6%
Net interest (income) expense		(166)		(190)		(12.6%)
Depreciation and amortization		26,619		24,875		7.0%
Gain on sale of real estate facilities and development rights		(19,621)		-		100.0%

EBITDAre	$	71,860	$	71,260		0.8%

⁽¹⁾	Same Park includes assets acquired prior to January 1, 2018.

⁽²⁾	Same Park rental income and cash rental income include lease buyout income of $278,000 and $177,000 for the three months ended March 31, 2020 and 2019, respectively.

⁽³⁾	Non-Same Park reflects assets acquired on or subsequent to January 1, 2018.

⁽⁴⁾	Adjusted cost of operations represents cost of operations excluding non-cash stock compensation expense for employees whose compensation expense is recorded in cost of operations. Refer to page 7 for reconciliation of cash expenses to Cost of Operations as reported on our GAAP income statement

⁽⁵⁾	The table below details Same Park adjusted cost of operations:


	For The Three Months Ended March 31,
	2020		2019		% Change
Cost of operations
Property taxes	$	10,789	$	10,147		6.3	%
Utilities		5,120		4,905		4.4	%
Repairs and maintenance		5,405		5,510		(1.9	%)
Snow removal		78		999		(92.2	%)
Payroll and other expenses		6,786		6,616		2.6	%

Total cost of operations	$	28,178	$	28,177		0.0	%

⁽⁶⁾

NOI from assets sold in 2020 was $53,000 and $617,000 for the three months ended March 31, 2020 and 2019, respectively. Cash NOI from assets sold in 2020 was $53,000 and $584,000 for the three months ended March 31, 2020 and 2019, respectively. The three month remainder NOI balance in 2019 relates to assets sold during 2019.

⁽⁷⁾

Cash rental income excludes non-cash revenue, specifically straight-line rent, amortization of above and below market rents, net, amortization of lease incentives and tenant improvement reimbursements. Refer to page 7 for reconciliation of cash rental income to Rental Income as reported on our GAAP income statement.

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	For the Three Months Ended
	March 31, 2020								March 31, 2019								Total % Change
	Industrial		Flex		Office		Total		Industrial		Flex		Office		Total		Total % Change
Cash rental income ⁽¹⁾
Northern California	$	21,039	$	2,579	$	3,127	$	26,745	$	20,552	$	2,467	$	2,992	$	26,011		2.8%
Southern California		9,002		4,898		187		14,087		8,790		4,638		183		13,611		3.5%
Dallas		3,168		5,430		—		8,598		3,050		5,130		—		8,180		5.1%
Austin		2,184		6,100		—		8,284		2,061		5,408		—		7,469		10.9%
Northern Virginia		1,938		6,068		9,972		17,978		1,793		6,326		10,582		18,701		(3.9%)
South Florida		10,608		502		32		11,142		10,443		456		1		10,900		2.2%
Seattle		3,242		1,735		186		5,163		2,657		1,602		181		4,440		16.3%
Suburban Maryland		1,042		—		4,131		5,173		1,197		—		3,687		4,884		5.9%

Total		52,223		27,312		17,635		97,170		50,543		26,027		17,626		94,196		3.2%

Adjusted cost of operations ⁽²⁾
Northern California		4,737		648		781		6,166		4,595		679		770		6,044		2.0%
Southern California		2,299		1,353		73		3,725		2,227		1,251		68		3,546		5.0%
Dallas		1,011		2,034		—		3,045		947		1,965		—		2,912		4.6%
Austin		745		2,214		—		2,959		718		2,006		—		2,724		8.6%
Northern Virginia		530		1,822		3,865		6,217		616		2,027		4,439		7,082		(12.2%)
South Florida		2,844		134		14		2,992		2,711		150		22		2,883		3.8%
Seattle		847		420		54		1,321		619		367		49		1,035		27.6%
Suburban Maryland		351		—		1,402		1,753		381		—		1,570		1,951		(10.1%)

Total		13,364		8,625		6,189		28,178		12,814		8,445		6,918		28,177		0.0%

Cash NOI
Northern California		16,302		1,931		2,346		20,579		15,957		1,788		2,222		19,967		3.1%
Southern California		6,703		3,545		114		10,362		6,563		3,387		115		10,065		3.0%
Dallas		2,157		3,396		—		5,553		2,103		3,165		—		5,268		5.4%
Austin		1,439		3,886		—		5,325		1,343		3,402		—		4,745		12.2%
Northern Virginia		1,408		4,246		6,107		11,761		1,177		4,299		6,143		11,619		1.2%
South Florida		7,764		368		18		8,150		7,732		306		(21)		8,017		1.7%
Seattle		2,395		1,315		132		3,842		2,038		1,235		132		3,405		12.8%
Suburban Maryland		691		—		2,729		3,420		816		—		2,117		2,933		16.6%

Total	$	38,859	$	18,687	$	11,446	$	68,992	$	37,729	$	17,582	$	10,708	$	66,019		4.5%

⁽¹⁾

Cash rental income excludes non-cash revenue, specifically straight-line rent, amortization of above and below market rents, net, amortization of lease incentives and tenant improvement reimbursements. Cash rental income includes lease buyout income of $278,000 and $177,000 for the three months ended March 31, 2020 and 2019, respectively.

⁽²⁾	Adjusted cost of operations represents cost of operations excluding non-cash stock compensation expense related to employees whose compensation expense is included in costs of operations. Refer to the “Forward-Looking Statement and Non-GAAP Disclosures” on page 3 for more information.

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	For the Three Months Ended		Cost per Weighted
	March 31, 2020		Average Square Foot
Commercial recurring capital expenditures ⁽¹⁾
Same Park
Capital improvements	$	1,220	$	0.05
Tenant improvements		3,438		0.13
Lease commissions		2,075		0.08

Total Same Park recurring capital expenditures		6,733	$	0.26

Non-Same Park
Capital improvements		3	$	—
Tenant improvements		92		0.05
Lease commissions		7		—

Total Non-Same Park recurring capital expenditures		102	$	0.05

Total recurring capital expenditures		6,835	$	0.25
Assets sold recurring capital expenditures		16

Total commercial recurring capital expenditures		6,851
Non-Same Park non-recurring property renovations ⁽²⁾		93

Multifamily capital expenditures		—

Total capital expenditures	$	6,944

⁽¹⁾

The Company defines “recurring capital expenditures” as capitalized costs necessary to continue to operate the property at its current economic value. Capital improvements in excess of $2,000 with a useful life greater than 24 months are capitalized. Lease transaction costs (i.e. tenant improvements and leasing commissions) of $1,000 or more for leases with terms greater than 12 months are capitalized. All leasing costs, including first generation tenant improvements and leasing commissions, are included in recurring capital expenditures.

⁽²⁾	Non-recurring property renovations represents renovations that substantially enhance the value of a property, including capitalized costs associated with repositioning acquired assets.

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	For the Three Months Ended
	March 31,
	2020		2019
Net income allocable to common shareholders	$	41,615	$	26,321
Adjustments
Gain on sale of real estate facilities		(19,621)		-
Depreciation and amortization		26,619		24,875
Net income allocable to noncontrolling interests		11,092		7,027
Net income allocable to restricted stock unit holders		275		268
FFO allocated to joint venture partner		(43)		(29)

FFO allocable to diluted common shares and units		59,937		58,462
Core FFO allocable to diluted common shares and units		59,937		58,462
Adjustments
Recurring capital improvements		(1,223)		(1,070)
Tenant improvements		(3,530)		(3,524)
Capitalized lease commissions		(2,082)		(1,843)
Total recurring capital expenditures for assets sold		(16)		(250)
Straight-line rent		(768)		(657)
In-place lease adjustment		(66)		21
Tenant improvement reimbursement amortization, net of lease incentive amortization		(230)		(379)
Stock compensation expense		942		971
Cash paid for taxes in lieu of shares upon vesting of restricted stock units		(3,655)		(5,494)

FAD allocable to diluted common shares and units		49,309		46,237
Distributions to common shareholders		(28,817)		(28,737)
Distributions to noncontrolling interests - common units		(7,671)		(7,671)
Distributions to restricted stock unit holders		(182)		(268)
Distributions to noncontrolling interests - joint venture		(38)		-

Free cash available after fixed charges		12,601		9,561
Non-recurring property renovations ⁽¹⁾		(93)		(864)
Investment in multifamily redevelopment ⁽²⁾		(875)		(425)
Investment in industrial development ⁽³⁾		(437)		-

Retained cash	$	11,196	$	8,272


Weighted average outstanding
Common shares		27,448		27,373
Operating partnership units		7,305		7,305
Restricted stock units		77		140
Common share equivalents		102		106

Total diluted common shares and units		34,932		34,924


FFO per share	$	1.72	$	1.67
Core FFO per share	$	1.72	$	1.67
FAD distribution payout ratio ⁽⁴⁾		74.4%		79.3%

⁽¹⁾	Non-recurring property renovations represents renovations that substantially enhance the value of a property, including capitalized costs associated with repositioning acquired assets.

⁽²⁾	Represents predevelopment and development costs related to multifamily redevelopment projects.

⁽³⁾	Represents developments and predevelopment costs related to industrial development projects.

⁽⁴⁾	FAD distribution payout ratio is equal to total distributions to common shareholders, unit holders, restricted stock unit holders and our joint venture partner divided by FAD during the same reporting period.

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	As of March 31, 2020						As of December 31, 2019
			% of Total						% of Total
			Market		WTD Average				Market		WTD Average
	Total		Capitalization		Rate		Total		Capitalization		Rate

Unsecured Debt:
$250.0 million unsecured credit facility (LIBOR + 0.825%)	$	-		-		-	$	-		-		-

Total unsecured debt		-		-		-		-		-		-


Preferred Equity:
5.200% Series W preferred stock (7,590,000 depositary shares outstanding) callable 10/20/21		189,750		3.4%				189,750		2.8%
5.250% Series X preferred stock (9,200,000 depositary shares outstanding) callable 9/21/22		230,000		4.1%				230,000		3.5%
5.200% Series Y preferred stock (8,000,000 depositary shares outstanding) callable 12/7/22		200,000		3.5%				200,000		3.0%
4.875% Series Z preferred stock (13,000,000 depositary shares outstanding) callable 11/4/24		325,000		5.7%				325,000		4.9%

Total preferred equity		944,750		16.7%		5.10%		944,750		14.2%		5.10%



Total debt and preferred equity		944,750		16.7%		5.10%		944,750		14.2%		5.10%

Common stock (27,477,303 and 27,440,953 shares outstanding as of March 31, 2020 and December 31, 2019, respectively) ⁽¹⁾		3,723,724		65.8%				4,524,190		67.8%
Common operating partnership units (7,305,355 units outstanding as of March 31, 2020 and December 31, 2019)⁽¹⁾		990,022		17.5%				1,204,434		18.0%
Total common equity ⁽¹⁾		4,713,746		83.3%				5,728,624		85.8%


Total market capitalization	$	5,658,496		100.0%			$	6,673,374		100.0%


	For the three months ended March 31, 2020						For the year ended December 31, 2019
Interest expense and related expenses ⁽³⁾	$	137					$	611
Preferred distributions		12,046						54,346

Total fixed charges and preferred distributions	$	12,183					$	54,957


Ratio of EBITDAre to fixed charges and preferred distributions		5.9x						5.3x
Ratio of FFO to fixed charges and preferred distributions		5.9x						5.3x
Ratio of Debt and Preferred Equity to EBITDAre ⁽²⁾		3.3x						3.3x

⁽¹⁾	Total common equity is calculated as the total number of common stock and operating partnership units outstanding multiplied by the Company’s closing share price at the end of each reporting period. Closing share prices on March 31, 2020 and December 31, 2019 were $135.52 and $164.87, respectively.

⁽²⁾	Ratio of debt and preferred equity to EBITDAre is calculated as total debt and preferred equity divided by EBITDAre. Ratio of debt and preferred equity to EBITDAre as of March 31, 2020 is calculated using annualized EBITDAre for the three months ended March 31, 2020.

⁽³⁾	Interest expense and related expenses includes facility fees associated with our unsecured credit facility.

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Industry Concentration as of March 31, 2020

					Percentage of
					Total Rental Income
Business services						19.7%
Warehouse, distribution, transportation and logistics						12.9%
Computer hardware, software and related services						11.0%
Health services						8.0%
Retail, food, and automotive						7.9%
Engineering and construction						7.8%
Government						6.3%
Insurance and financial services						3.3%
Electronics						3.0%
Home furnishings						2.6%
Communications						1.9%
Aerospace/defense products and services						1.9%
Educational services						1.0%
Other						12.7%

Total						100.0%


Top 10 Customers by Total Annual Rental Income as of March 31, 2020

	Square Footage		Annualized		Percentage of Total
Customer	Square Footage		Rental Income ⁽¹⁾		Annualized Rental Income

US Government		521,000	$	13,831		3.3%
Luminex Corporation		199,000		4,351		1.0%
Amazon Inc.		213,000		2,734		0.7%
KZ Kitchen Cabinet & Stone		191,000		2,667		0.6%
Lockheed Martin Corporation		124,000		2,570		0.6%
CentralColo, LLC		96,000		2,328		0.6%
Applied Materials, Inc.		162,000		2,327		0.6%
Carbel, LLC		236,000		2,238		0.5%
Quanta Computer Inc.		179,000		1,884		0.4%
ECS Federal, LLC		81,000		1,852		0.4%

Total		2,002,000	$	36,782		8.7%


Tenant Composition as of March 31, 2020

					Average Tenant Size
			Number		(in square feet)
			of Tenants		Average square footage
Large Tenant Portfolio ⁽²⁾				1,371		12,892
Small Tenant Portfolio ⁽³⁾				3,634		2,150

Total Portfolio				5,005		5,093

⁽¹⁾	For leases expiring within one year, annualized rental income includes only the income to be received under the existing lease from April 1, 2020 through the respective date of expiration.

⁽²⁾	Large tenant portfolio consists of properties with average leases greater than or equal to 5,000 square feet.

⁽³⁾	Small tenant portfolio consists of properties with average leases less than 5,000 square feet.

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Realized Revenue per Occupied Square Foot⁽¹⁾⁽²⁾
	For the Three Months
	Ended March 31,
Region	2020		2019		% Change

Northern California	$	16.37	$	14.90		9.9	%
Southern California	$	18.33	$	17.34		5.7	%
Dallas	$	13.32	$	12.47		6.8	%
Austin	$	17.74	$	17.14		3.5	%
Northern Virginia	$	20.19	$	20.55		(1.8	%)
South Florida	$	12.28	$	11.69		5.0	%
Seattle	$	14.90	$	13.16		13.2	%
Suburban Maryland	$	19.68	$	19.81		(0.7	%)
Total	$	16.42	$	15.58		5.4	%

Revenue per Available Foot (RevPAF)⁽¹⁾⁽³⁾
	For the Three Months
	Ended March 31,
Region	2020		2019		% Change

Northern California	$	14.95	$	14.39		3.9	%
Southern California	$	17.35	$	16.58		4.6	%
Dallas	$	12.03	$	11.53		4.3	%
Austin	$	16.95	$	15.54		9.1	%
Northern Virginia	$	18.61	$	19.27		(3.4	%)
South Florida	$	11.55	$	11.27		2.5	%
Seattle	$	14.74	$	12.64		16.6	%
Suburban Maryland	$	17.98	$	17.65		1.9	%
Total	$	15.25	$	14.76		3.3	%

Realized Revenue per Occupied Square Foot⁽¹⁾⁽²⁾
	For the Three Months
	Ended March 31,
Region	2020		2019		% Change

Industrial	$	13.81	$	12.78		8.1	%
Flex	$	19.31	$	18.61		3.8	%
Office	$	24.57	$	25.13		(2.2	%)
Total	$	16.42	$	15.58		5.4	%

Revenue per Available Foot (RevPAF)⁽¹⁾⁽³⁾
	For the Three Months
	Ended March 31,
Region	2020		2019		% Change

Industrial	$	12.85	$	12.31		4.4	%
Flex	$	17.97	$	17.12		5.0	%
Office	$	22.59	$	23.06		(2.0	%)
Total	$	15.25	$	14.76		3.3	%

⁽¹⁾	Rental income includes lease buyout income of $278,000 and $177,000 for the three ended March 31, 2020 and 2019, respectively.

⁽²⁾	Represents GAAP revenue earned per occupied square foot. For the three month periods ended March 31, 2020 and 2019, GAAP rental income amounts have been annualized.

⁽³⁾	Represents GAAP revenue earned per total weighted average available square foot. For the three month periods ended March 31, 2020 and 2019, GAAP rental income amounts have been annualized.

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Rentable Square Footage of Same Park Properties by Product Type as of March 31, 2020


Markets	Industrial		Flex		Office		Total		% of Total

Northern Virginia		507		1,440		1,970		3,917		15.2	%
South Florida		3,728		126		12		3,866		15.0	%
Silicon Valley		3,094		367		-		3,461		13.8	%
East Bay		3,297		53		-		3,350		13.0	%
Dallas		1,300		1,587		-		2,887		11.2	%
Austin		755		1,208		-		1,963		7.6	%
Los Angeles County		1,256		317		31		1,604		6.2	%
Seattle		1,092		270		28		1,390		5.4	%
Suburban Maryland		394		-		751		1,145		4.4	%
Orange County		810		101		-		911		3.5	%
San Diego County		233		535		-		768		3.0	%
Mid-Peninsula		-		94		340		434		1.7	%

Total		16,466		6,098		3,132		25,696		100.0	%

Percentage by Product Type		64.1%		23.7%		12.2%		100.0%

Same Park Weighted Average Occupancy Rates by Product Type for the Three Months Ended March 31, 2020

Markets			Industrial		Flex		Office		Total

Northern Virginia				93.3%		94.6%		90.0%		92.1%
South Florida				94.2%		88.1%		100.0%		94.0%
Silicon Valley				96.3%		97.7%		-		96.4%
East Bay				85.8%		93.9%		-		86.0%
Dallas				92.4%		88.5%		-		90.3%
Austin				98.2%		93.9%		-		95.5%
Los Angeles County				94.0%		97.1%		98.9%		94.7%
Seattle				99.4%		97.2%		98.4%		98.9%
Suburban Maryland				84.7%		-		94.5%		91.1%
Orange County				93.5%		91.9%		-		93.4%
San Diego County				97.3%		95.7%		-		96.2%
Mid-Peninsula				-		86.0%		94.6%		92.8%
Total				93.0%		93.1%		91.8%		92.9%

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Rentable Square Footage of Same Park Properties by Size as of March 31, 2020⁽¹⁾

Markets	Large Tenant		Small Tenant		Total		% of Total

Northern Virginia		2,479		1,438		3,917		15.2	%
South Florida		3,107		759		3,866		15.0	%
Silicon Valley		2,835		626		3,461		13.8	%
East Bay		3,052		298		3,350		13.0	%
Dallas		1,758		1,129		2,887		11.2	%
Austin		1,718		245		1,963		7.6	%
Los Angeles County		712		892		1,604		6.2	%
Seattle		951		439		1,390		5.4	%
Suburban Maryland		537		608		1,145		4.4	%
Orange County		513		398		911		3.5	%
San Diego County		-		768		768		3.0	%
Mid-Peninsula		-		434		434		1.7	%

Total		17,662		8,034		25,696		100.0	%

Percentage by Product Type		68.7%		31.3%		100.0%

Same Park Weighted Average Occupancy Rates by Size for the Three Months Ended March 31, 2020⁽¹⁾

Markets			Large Tenant		Small Tenant		Total

Northern Virginia				91.0%		94.1%		92.1%
South Florida				94.3%		92.7%		94.0%
Silicon Valley				97.1%		93.4%		96.4%
East Bay				84.7%		98.9%		86.0%
Dallas				92.6%		86.7%		90.3%
Austin				96.5%		88.5%		95.5%
Los Angeles County				94.8%		94.6%		94.7%
Seattle				99.6%		97.5%		98.9%
Suburban Maryland				91.2%		91.0%		91.1%
Orange County				92.8%		94.1%		93.4%
San Diego County				-		96.2%		96.2%
Mid-Peninsula				-		92.8%		92.8%
Total				92.8%		93.0%		92.9%

⁽¹⁾	The Company’s “large tenant” portfolio consists of properties with average leases greater than or equal to 5,000 square feet while the “small tenant” portfolio consists of properties with average leases less than 5,000 square feet.

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Rentable Square Footage of Properties by Product Type as of March 31, 2020

Markets	Industrial		Flex		Office		Total		% of Total

Northern Virginia		1,564		1,440		1,970		4,974		18.1%
South Florida		3,728		126		12		3,866		13.9%
Silicon Valley		3,094		446		-		3,540		12.9%
East Bay		3,297		53		-		3,350		12.2%
Dallas		1,300		1,587		-		2,887		10.5%
Los Angeles County		1,946		317		31		2,294		8.3%
Austin		755		1,208		-		1,963		7.1%
Seattle		1,092		270		28		1,390		5.1%
Suburban Maryland		394		-		751		1,145		4.2%
Orange County		810		101		-		911		3.3%
San Diego County		233		535		-		768		2.8%
Mid-Peninsula		-		94		340		434		1.6%

Total		18,213		6,177		3,132		27,522		100.0%

Percentage by Product Type		66.2%		22.4%		11.4%		100.0%

Weighted Average Occupancy Rates by Product Type for the Three Months Ended March 31, 2020

Markets			Industrial		Flex		Office		Total

Northern Virginia				90.7%		94.6%		90.0%		91.6%
South Florida				94.2%		88.1%		100.0%		94.0%
Silicon Valley				96.3%		96.7%		-		96.3%
East Bay				85.8%		93.9%		-		86.0%
Dallas				92.4%		88.5%		-		90.3%
Los Angeles County				95.9%		97.1%		98.9%		96.1%
Austin				98.2%		93.9%		-		95.5%
Seattle				99.4%		97.2%		98.4%		98.9%
Suburban Maryland				84.7%		-		94.5%		91.1%
Orange County				93.5%		91.9%		-		93.4%
San Diego County				97.3%		95.7%		-		96.2%
Mid-Peninsula				-		86.0%		94.6%		92.8%
Total				93.1%		93.1%		91.8%		92.9%

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Rentable Square Footage of Properties by Size as of March 31, 2020⁽¹⁾

Markets	Large		Small		Total		% of Total


Northern Virginia		3,399		1,575		4,974		18.1%
South Florida		3,107		759		3,866		13.9%
Silicon Valley		2,835		705		3,540		12.9%
East Bay		3,052		298		3,350		12.2%
Dallas		1,758		1,129		2,887		10.5%
Los Angeles County		1,255		1,039		2,294		8.3%
Austin		1,718		245		1,963		7.1%
Seattle		951		439		1,390		5.1%
Suburban Maryland		537		608		1,145		4.2%
Orange County		513		398		911		3.3%
San Diego County		-		768		768		2.8%
Mid-Peninsula		-		434		434		1.6%

Total		19,125		8,397		27,522		100.0%

Percentage by Product Type		69.5%		30.5%		100.0%

Weighted Average Occupancy Rates by Size for the Three Months Ended March 31, 2020⁽¹⁾

Markets				Large Tenant		Small Tenant		Total


Northern Virginia				90.4%		94.1%		91.6%
South Florida				94.3%		92.7%		94.0%
Silicon Valley				97.1%		93.2%		96.3%
East Bay				84.7%		98.9%		86.0%
Dallas				92.6%		86.7%		90.3%
Los Angeles County				97.1%		94.9%		96.1%
Austin				96.5%		88.5%		95.5%
Seattle				99.6%		97.5%		98.9%
Suburban Maryland				91.2%		91.0%		91.1%
Orange County				92.8%		94.1%		93.4%
San Diego County				-		96.2%		96.2%
Mid-Peninsula				-		92.8%		92.8%
Total				92.9%		93.1%		92.9%

⁽¹⁾	The Company’s “large tenant” portfolio consists of properties with average leases greater than or equal to 5,000 square feet while the “small tenant” portfolio consists of properties with average leases less than 5,000 square feet.

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Lease Expirations - Total Portfolio
			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income⁽¹⁾		%		Rental Income

2020		4,337	$	70,930		16.0%		16.0%
2021		5,257		90,314		20.4%		20.4%
2022		5,109		90,630		20.5%		20.5%
2023		3,744		62,240		14.1%		14.1%
2024		2,642		46,668		10.6%		10.6%
Thereafter		4,492		81,486		18.4%		18.4%

Total		25,581	$	442,268		100.0%		100.0%


Lease Expirations - Industrial
			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income⁽¹⁾		%		Rental Income

2020		2,823	$	36,917		15.1%		8.3%
2021		3,246		47,214		19.2%		10.7%
2022		3,304		48,517		19.8%		11.0%
2023		2,628		37,262		15.2%		8.4%
2024		1,854		28,241		11.5%		6.4%
Thereafter		3,060		47,146		19.2%		10.7%

Total		16,915	$	245,297		100.0%		55.5%


Lease Expirations - Flex
			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income⁽¹⁾		%		Rental Income

2020		1,009	$	19,323		16.3%		4.4%
2021		1,423		28,179		23.7%		6.3%
2022		1,227		25,991		21.9%		5.9%
2023		621		12,370		10.4%		2.8%
2024		460		9,804		8.3%		2.2%
Thereafter		1,026		23,024		19.4%		5.2%

Total		5,766	$	118,691		100.0%		26.8%


Lease Expirations - Office
			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income

2020		505	$	14,690		18.8%		3.3%
2021		588		14,921		19.1%		3.4%
2022		578		16,122		20.6%		3.6%
2023		495		12,608		16.1%		2.9%
2024		328		8,623		11.0%		2.0%
Thereafter		406		11,316		14.4%		2.5%

Total		2,900	$	78,280		100.0%		17.7%

⁽¹⁾	Annualized rental income represents annualized outgoing rents inclusive of related estimated expense recoveries. Actual rental income amounts may vary depending upon re-letting of expiring spaces.

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Lease Expirations - Northern California

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		924	$	19,220		16.1%		4.3%
2021		1,232		22,631		18.9%		5.1%
2022		1,117		19,575		16.4%		4.4%
2023		915		16,448		13.8%		3.7%
2024		744		12,727		10.7%		2.9%
Thereafter		1,678		28,738		24.1%		6.5%

Total		6,610	$	119,339		100.0%		26.9%


Lease Expirations - Southern California

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		1,038	$	15,463		22.4%		3.5%
2021		873		16,717		24.2%		3.8%
2022		995		18,353		26.7%		4.2%
2023		353		6,916		10.0%		1.6%
2024		304		6,390		9.3%		1.4%
Thereafter		277		5,133		7.4%		1.2%

Total		3,840	$	68,972		100.0%		15.7%


Lease Expirations - Dallas

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		466	$	6,473		17.8%		1.5%
2021		679		8,990		24.7%		2.0%
2022		332		4,126		11.4%		0.9%
2023		482		6,192		17.0%		1.4%
2024		190		2,862		7.9%		0.7%
Thereafter		473		7,700		21.2%		1.7%

Total		2,622	$	36,343		100.0%		8.2%


Lease Expirations - Austin

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		186	$	3,273		9.1%		0.7%
2021		330		6,259		17.5%		1.4%
2022		401		7,254		20.2%		1.6%
2023		203		3,536		9.9%		0.8%
2024		209		4,392		12.3%		1.0%
Thereafter		552		11,118		31.0%		2.5%

Total		1,881	$	35,832		100.0%		8.0%

⁽¹⁾	Annualized rental income represents annualized outgoing rents inclusive of related estimated expense recoveries. Actual rental income amounts may vary depending upon re-letting of expiring spaces.

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Lease Expirations - Northern Virginia

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		700	$	11,899		13.0%		2.7%
2021		934		17,390		19.0%		3.9%
2022		1,081		23,879		26.1%		5.4%
2023		516		10,714		11.7%		2.4%
2024		499		10,208		11.2%		2.3%
Thereafter		838		17,394		19.0%		3.9%

Total		4,568	$	91,484		100.0%		20.6%


Lease Expirations - South Florida

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		640	$	6,889		15.2%		1.6%
2021		794		10,228		22.6%		2.4%
2022		800		10,316		22.9%		2.3%
2023		668		8,368		18.5%		1.9%
2024		469		6,087		13.5%		1.4%
Thereafter		257		3,302		7.3%		0.8%

Total		3,628	$	45,190		100.0%		10.4%


Lease Expirations - Suburban Maryland

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		149	$	3,991		17.2%		0.9%
2021		187		3,551		15.3%		0.8%
2022		143		2,905		12.5%		0.7%
2023		244		5,322		22.9%		1.2%
2024		96		2,107		9.1%		0.5%
Thereafter		232		5,337		23.0%		1.2%

Total		1,051	$	23,213		100.0%		5.3%


Lease Expirations - Seattle

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽¹⁾		%		Rental Income
2020		234	$	3,722		17.0%		0.8%
2021		228		4,548		20.8%		1.0%
2022		240		4,222		19.3%		1.0%
2023		363		4,744		21.7%		1.1%
2024		131		1,895		8.6%		0.4%
Thereafter		185		2,764		12.6%		0.6%

Total		1,381	$	21,895		100.0%		4.9%

⁽¹⁾	Annualized rental income represents annualized outgoing rents inclusive of related estimated expense recoveries. Actual rental income amounts may vary depending upon re-letting of expiring spaces.

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Lease Expirations - Large Tenant Portfolio ⁽¹⁾

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽³⁾		%		Rental Income
2020		2,560	$	37,104		13.3%		8.4%
2021		3,018		44,864		16.1%		10.1%
2022		3,362		54,474		19.6%		12.3%
2023		2,716		40,466		14.5%		9.2%
2024		2,118		34,529		12.4%		7.8%
Thereafter		3,935		67,211		24.1%		15.2%

Total		17,709	$	278,648		100.0%		63.0%


Lease Expirations - Small Tenant Portfolio ⁽²⁾

			Annualized				% of Total Annualized
Year of Lease Expiration	Leased Square Footage		Rental Income ⁽³⁾		%		Rental Income
2020		1,777	$	33,826		20.7%		7.6%
2021		2,239		45,450		27.8%		10.3%
2022		1,747		36,156		22.1%		8.2%
2023		1,028		21,774		13.3%		4.9%
2024		524		12,139		7.4%		2.8%
Thereafter		557		14,275		8.7%		3.2%

Total		7,872	$	163,620		100.0%		37.0%

⁽¹⁾	Large tenant portfolio consists of properties with average leases greater than or equal to 5,000 square feet.

⁽²⁾	Small tenant portfolio consists of properties with average leases less than 5,000 square feet.

⁽³⁾	Annualized rental income represents annualized outgoing rents inclusive of related estimated expense recoveries. Actual rental income amounts may vary depending upon re-letting of expiring spaces.

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	Total Portfolio Activity
	Wtd. Avg.		Leasing		Customer		Transaction Costs		Transaction Costs		Cash Rental Rate
	Occupancy		Volume		Retention		per Executed Foot		as a % of Rents⁽¹⁾		Change⁽²⁾

Northern Virginia		91.6%		398,000		75.6%	$	6.33		10.2%		1.1%

South Florida		94.0%		179,000		51.6%	$	1.48		3.2%		7.7%

Silicon Valley		96.3%		245,000		74.1%	$	3.06		2.6%		17.8%

East Bay		86.0%		98,000		83.2%	$	1.41		1.5%		19.0%

Dallas		90.3%		197,000		66.0%	$	3.58		8.7%		3.6%

Suburban Maryland		91.1%		48,000		72.4%	$	9.42		12.0%		2.4%

Austin		95.5%		90,000		81.1%	$	3.26		4.8%		4.3%

Los Angeles		96.1%		201,000		87.9%	$	3.18		6.2%		15.1%

Seattle		98.9%		264,000		92.5%	$	0.83		2.0%		30.0%

Orange County		93.4%		84,000		61.7%	$	3.23		4.1%		7.7%

San Diego		96.2%		75,000		71.2%	$	1.99		3.8%		4.4%

Mid-Peninsula		92.8%		30,000		90.0%	$	0.43		0.6%		5.0%
Company Totals by Market		92.9%		1,909,000		75.4%	$	3.36		5.2%		9.5%

Industrial		93.1%		1,276,000		75.7%	$	2.06		3.3%		15.1%

Flex		93.1%		430,000		76.6%	$	5.75		8.5%		2.8%

Office		91.8%		203,000		71.8%	$	6.45		9.4%		2.3%

Company Totals by Type		92.9%		1,909,000		75.4%	$	3.36		5.2%		9.5%

⁽¹⁾	Transaction cost percentages are computed by taking the total transaction costs divided by the total rents (including estimated expense recoveries) over the term of the lease.

⁽²⁾

Cash rental rate change percentages are computed by taking the percentage difference between outgoing rents (including estimated expense recoveries) and incoming rents (including estimated expense recoveries) for leases executed during the period. Leases executed on spaces vacant for more than the preceding twelve months have been excluded.

PS BUSINESS PARKS, INC./MD - FORM 8-K - EX-99.2 - April 29, 2020

Attached files

PS BUSINESS PARKS, INC./MD Reports