Attached files
| file | filename |
|---|---|
| EX-99.3 - EX-99.3 - Pacific Oak Strategic Opportunity REIT, Inc. | pacificoaksorbviq12021fins.htm |
| EX-99.1 - EX-99.1 - Pacific Oak Strategic Opportunity REIT, Inc. | pacoaksorbviq12021finsex991.htm |
| 8-K - 8-K - Pacific Oak Strategic Opportunity REIT, Inc. | pacificoaksor-ifrsfinancia.htm |
Exhibit 99.2
PACIFIC OAK SOR (BVI) HOLDINGS, LTD.
PRESENTATION OF SEPARATE FINANCIAL DATA FROM THE
CONSOLIDATED FINANCIAL STATEMENTS ATTRIBUTABLE TO THE COMPANY
March 31, 2021 (Unaudited)
PACIFIC OAK SOR (BVI) HOLDNGS, LTD.
PRESENTATION OF SEPARATE FINANCIAL DATA
FROM THE CONSOLIDATED FINANCIAL STATEMENTS
ATTRIBUTABLE TO THE COMPANY
AS OF MARCH 31, 2021
(UNAUDITED)
U.S. DOLLARS IN THOUSANDS
INDEX
| Page | |||||
| Special Report Presented Pursuant to Regulation 38d | 2 | ||||
| Financial Information from the Consolidated Statements of Financial Position Attributable to the Company | 3 | ||||
| Financial Information from the Consolidated Statements of Profit or Loss Attributable to the Company | 4 | ||||
| Financial Information from the Consolidated Statements of Comprehensive Income Attributable to the Company | 5 | ||||
| Financial Information from the Consolidated Statements of Cash Flows Attributable to the Company | 6 | ||||
| Additional Information | 7 - 8 | ||||
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Special Report in accordance with Regulation 38d
Financial Information and Financial Data from the
Consolidated Financial Statements Attributable to the Company
Below is separate financial information and financial data attributable to the Company from the Group's consolidated financial statements as of March 31, 2021, published as part of the periodic reports ("consolidated financial statements"), presented in accordance with Regulation 38d to the Israeli Securities Regulations (Periodic and Immediate Reports), 1970.
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PACIFIC OAK SOR (BVI) HOLDNGS, LTD.
Financial Information from the Consolidated Statements of Financial Position Attributable to the Company
| March 31, | December 31, | |||||||||||||||||||
| 2021 | 2020 | 2020 | ||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S. dollars in thousands | ||||||||||||||||||||
| ASSETS | ||||||||||||||||||||
| Non-current assets | ||||||||||||||||||||
| Investments in investees | $ | 1,160,461 | $ | 907,475 | $ | 1,187,342 | ||||||||||||||
| Restricted cash | 6,358 | 5,650 | 6,246 | |||||||||||||||||
| 1,166,819 | 913,125 | 1,193,588 | ||||||||||||||||||
| Current assets | ||||||||||||||||||||
| Cash and cash equivalents | 71,667 | 10,847 | 11,956 | |||||||||||||||||
| Derivative asset | — | 8,818 | — | |||||||||||||||||
| 71,667 | 19,665 | 11,956 | ||||||||||||||||||
| Total assets | $ | 1,238,486 | $ | 932,790 | $ | 1,205,544 | ||||||||||||||
| EQUITY | $ | 959,482 | $ | 698,203 | $ | 929,770 | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||||||||
| Debentures, net | 166,221 | 176,414 | 196,557 | |||||||||||||||||
| Current liabilities | ||||||||||||||||||||
| Accounts payable and accrued liabilities | 1,363 | 1,420 | 4,015 | |||||||||||||||||
| Debentures, net | 95,465 | 54,688 | 60,399 | |||||||||||||||||
| Due to Owner | 5,347 | 2,065 | 3,045 | |||||||||||||||||
| Distribution payable to Owner | 10,608 | — | 11,758 | |||||||||||||||||
| 112,783 | 58,173 | 79,217 | ||||||||||||||||||
| Total liabilities | 279,004 | 234,587 | 275,774 | |||||||||||||||||
| Total equity and liabilities | $ | 1,238,486 | $ | 932,790 | $ | 1,205,544 | ||||||||||||||
The accompanying notes are an integral part of the condensed interim financial data.
May 6, 2021 | /s/ Michael Allen Bender | /s/ Peter McMillan III | /s/ Keith David Hall | |||||||||||||||||
Date of approval of | Bender, Michael Allen | McMillan III, Peter | Hall, Keith David | |||||||||||||||||
financial statements | Chief Financial Officer | Chairman of Board of Directors | Chief Executive Officer | |||||||||||||||||
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PACIFIC OAK SOR (BVI) HOLDNGS, LTD.
Financial Information from the Consolidated Statements of Profit or Loss Attributable to the Company
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2021 | 2020 | 2020 | ||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S. dollars in thousands | ||||||||||||||||||||
| Share of profit (loss) from investees, net | $ | 28,989 | $ | (38,026) | $ | (35,051) | ||||||||||||||
| Asset management fees to affiliate | (3,852) | (2,106) | (9,982) | |||||||||||||||||
| General and administrative expenses | (639) | (573) | (3,590) | |||||||||||||||||
| Operating income (loss) | 24,498 | (40,705) | (48,623) | |||||||||||||||||
| Finance expense | (3,134) | (2,951) | (11,785) | |||||||||||||||||
| Finance income | 2 | 9 | 15 | |||||||||||||||||
| Foreign currency transaction adjustments, net | 8,346 | 14,996 | (2,900) | |||||||||||||||||
| Net income (loss) | $ | 29,712 | $ | (28,651) | $ | (63,293) | ||||||||||||||
The accompanying notes are an integral part of the condensed interim financial data.
4
PACIFIC OAK SOR (BVI) HOLDNGS, LTD.
Financial Information from the Consolidated Statements of Comprehensive Income Attributable to the Company
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2021 | 2020 | 2020 | ||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S. dollars in thousands | ||||||||||||||||||||
| Net income (loss) | $ | 29,712 | $ | (28,651) | $ | (63,293) | ||||||||||||||
| Total comprehensive income (loss) | $ | 29,712 | $ | (28,651) | $ | (63,293) | ||||||||||||||
The accompanying notes are an integral part of the condensed interim financial data.
5
PACIFIC OAK SOR (BVI) HOLDNGS, LTD.
Financial Information from the Consolidated Statements of Cash Flows Attributable to the Company
| Three months ended March 31, | Year ended December 31, | |||||||||||||||||||
| 2021 | 2020 | 2020 | ||||||||||||||||||
| Unaudited | Audited | |||||||||||||||||||
| U.S. dollars in thousands | ||||||||||||||||||||
| Cash flows from operating activities | ||||||||||||||||||||
| Net income (loss) for the period | $ | 29,712 | $ | (28,651) | $ | (63,293) | ||||||||||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||||||||
| Share of (profit) loss from investees | (28,989) | 38,026 | 35,051 | |||||||||||||||||
| Finance expense | 3,134 | 2,951 | 11,785 | |||||||||||||||||
| Distribution from investees, net | 14,363 | 10,880 | 47,048 | |||||||||||||||||
| Foreign currency transaction adjustments, net | (8,346) | (14,996) | 2,900 | |||||||||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||||||||
| Accounts payable and accrued liabilities | 36 | 120 | (196) | |||||||||||||||||
| Restricted cash for operational expenditures | (358) | (508) | (511) | |||||||||||||||||
| Due to Owner | 2,302 | 2,065 | 3,045 | |||||||||||||||||
| Net cash provided by operating activities | 11,854 | 9,887 | 35,829 | |||||||||||||||||
| Cash flows from investing activities | ||||||||||||||||||||
| Distributions from (investments in) investees | 41,507 | (10,269) | (42,862) | |||||||||||||||||
| Proceeds from termination of derivative financial instrument | — | — | 14,125 | |||||||||||||||||
| Net cash provided by (used in) investing activities | 41,507 | (10,269) | (28,737) | |||||||||||||||||
| Cash flows from financing activities | ||||||||||||||||||||
| Proceeds from debentures | 74,232 | 74,118 | 74,118 | |||||||||||||||||
| Payments of deferred financing costs | (923) | (2,168) | (2,168) | |||||||||||||||||
| Principal payments on debentures | (58,889) | (56,611) | (56,611) | |||||||||||||||||
| Interest paid | (5,285) | (4,814) | (9,818) | |||||||||||||||||
| Release of restricted cash for debt service obligations | — | 1,011 | 1,011 | |||||||||||||||||
| Distribution to Owner | (1,150) | — | (2,500) | |||||||||||||||||
| Net cash provided by financing activities | 7,985 | 11,536 | 4,032 | |||||||||||||||||
| Effect of exchange rate changes on cash and cash equivalents | (1,635) | (375) | 764 | |||||||||||||||||
| Increase in cash | 59,711 | 10,779 | 11,888 | |||||||||||||||||
| Cash, beginning of the period | 11,956 | 68 | 68 | |||||||||||||||||
| Cash, end of the period | $ | 71,667 | $ | 10,847 | $ | 11,956 | ||||||||||||||
The accompanying notes are an integral part of the condensed interim financial data.
6
PACIFIC OAK SOR (BVI) HOLDNGS, LTD.
Additional Information
U.S. dollars in thousands
NOTE 1: BASIS OF PREPERATION
Separate financial information is prepared in a condensed format as of March 31, 2021 and for the three months then ended, in accordance with Regulation 38D of the Securities Regulations (Periodic and Immediate Reports), 1970.
Please refer to the separate financial information in this regard to the financial information on the annual financial statements of the Company as of December 31, 2020 and for the year then ended, and the information accompanying notes (hereinafter - the annual consolidated financial statements).
As of March 31, 2021, the Company had a working capital shortfall amounting to $41.1 million, primarily attributed to the debentures principal payment maturing in the year following the date of the statement of financial position. The Company intends to make the debentures principal payment from distribution from investees. Accordingly, the Company does not view the working capital shortfall as a liquidity problem.
The recent global outbreak of COVID-19 (more commonly known as the Coronavirus) has significantly disrupted economic markets and impacted commercial activity worldwide, including the US, and the prolonged economic impact is uncertain. Some economists and major investment banks have expressed concern that the continued spread of the virus globally will lead to a world-wide economic downturn. Customers and potential customers of the properties we own could be adversely affected by the disruption to business caused by the global outbreak of the Coronavirus. This could lead to similar negative impacts on our business. The Company's March 2021 rents were over 93% collected.
Because our property investments are located in the United States, COVID-19 has begun and will continue to impact our properties and operating results given its continued spread within the United States reduces occupancy, increases the cost of operation, results in limited hours or necessitates the closure of such properties. In addition, quarantines, states of emergencies and other measures taken to curb the spread of COVID-19 may negatively impact the ability of such properties to continue to obtain necessary goods and services or provide adequate staffing, which may also adversely affect our properties and operating results.
7
PACIFIC OAK SOR (BVI) HOLDNGS, LTD.
Additional Information
U.S. dollars in thousands
NOTE 2: SIGNIFICANT EVENTS DURING THE REPORTING PERIOD
Series A Debentures
On March 1, 2021, the Company paid the third principal installment payment of 194.0 million Israeli new Shekels (approximately $58.9 million as of March 1, 2021).
On March 4, 2021 the Company issued debentures (series A) in the amount of 250.0 million NIS par value through a private placement. The debentures were issued at a 1.9% discount resulting in total consideration of 245.3 million NIS ($74.2 million as of March 4, 2021). The additional debentures shall have an equal level of security, pari passu, amongst themselves and between them and the debentures (Series A), which were initially issued, without any right of precedence or preference between any of them.
Series B Debentures
On February 16, 2020, the Company issued 254.1 million Israeli new Shekels (approximately $74.1 million as of February 16, 2020) of Series B debentures to Israeli investors pursuant to a public offering registered with the Israel Securities Authority. The Series B Debentures bears interest at the rate of 3.93% per year. The first interest payment was on July 31, 2020 and subsequent payments are on January 31st and July 31st of each year from 2021 to 2026. The aggregate offering costs were approximately $2.2 million and the effective interest rate is approximately 4.5%. The Series B Debentures have principal installment payments equal to 33.33% of the face amount of the Series B Debentures on January 31st of each year from 2024 to 2026.
The Series B Debentures contains the following covenants: (i) Consolidated Equity Capital of the Company (not including minority rights) shall not be less than USD 475 million; (ii) the Net Adjusted Financial Debt to Net Adjusted Cap (shall not exceed a rate of 75%); (iii) Adjusted NOI shall be no lower than USD 35 million; and (iv) the consolidated scope of the projects for development of the Company shall not exceed 10% of the adjusted balance. As of March 31, 2021, the Company was in compliance with all covenants under the deed of trust of the Series B Debentures; (i) Consolidated Equity Capital of the Company as of March 31, 2021 was $959.5 million; (ii) the Net Adjusted Debt to Net Adjusted Cap was 54%; (iii) the Adjusted NOI was $84.7 million for the trailing twelve months ended March 31, 2021; and (iv) the consolidated scope of projects was $0 as of March 31, 2021.
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