Exhibit 99.2

 

 

 

SUPPLEMENTAL FINANCIAL INFORMATION

 

As of June 30, 2021

 

 

FORWARD-LOOKING STATEMENTS

 

This presentation contains “forward-looking statements” within the meaning of the federal securities laws that involve risks and uncertainties, many of which are beyond our control. Our actual results could differ materially and adversely from those anticipated in such forward-looking statements as a result of certain factors, including those set forth in the Quarterly Report on Form 10-Q. Forward-looking statements relate to matters such as our industry, business strategy, goals and expectations concerning our market position, future operations, margins, profitability, capital expenditures, financial condition, liquidity, capital resources, cash flows, dividends, results of operations and other financial and operating information. When used in this presentation, the words “will,” “may,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “should,” “project,” “plan,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.

 

The forward-looking statements contained in this presentation are based on historical performance and management’s current plans, estimates and expectations in light of information currently available to it and are subject to uncertainty and changes in circumstances. There can be no assurance that future developments affecting us will be those that we have anticipated. Actual results may differ materially from these expectations due to the factors, risks and uncertainties described in the Annual Report on Form 10-K, as filed March 30, 2021 (“Annual Report”) and the Company’s Quarterly Report on Form 10-Q filed with the SEC on the date hereof (“Quarterly Report”), changes in global, regional or local political, economic, business, competitive, market, regulatory and other factors described in the “Risk Factors” section of the Annual Report and the Quarterly Report, many of which are beyond our control. Should one or more of these risks or uncertainties materialize or should any of our assumptions prove to be incorrect, our actual results may vary in material respects from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. Any forward-looking statement made by us in this presentation speaks only as of the date on which we make it. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable securities laws.

 

 

 

 

COMMERCIAL PORTFOLIO

 

Property Location ($ in 000s)		Sq. Ft.				Date Acquired		Year Property Constructed		Purchase Price (1)				Occupancy				Percent Ownership				Mortgage Outstanding
Office/Industrial Properties:
Genesis Plaza, San Diego, CA (2)(3)			57,807			08/10		1989			10,000				74.7	%			76.4	%			6,223
Dakota Center, Fargo, ND			119,434			05/11		1982			9,575				72.3	%			100.0	%			9,789
Grand Pacific Center, Bismarck, ND			93,058			04/14		1976			5,350				71.2	%			100.0	%			3,679
Arapahoe Service Center II, Centennial, CO			79,023			12/14		2000			11,850				100.0	%			100.0	%			7,852
West Fargo Industrial, West Fargo, ND			150,030			08/15		1998/2005			7,900				87.6	%			100.0	%			4,206
300 N.P., West Fargo, ND			34,517			08/15		1922			3,850				69.9	%			100.0	%			2,253
One Park Centre, Westminster, CO			69,174			08/15		1983			9,150				82.5	%			100.0	%			6,331
Shea Center II, Highlands Ranch, CO			121,301			12/15		2000			25,325				94.7	%			100.0	%			17,621
Total Office/Industrial Properties			724,344							$	83,000				83.2	%						$	57,954
Retail Properties:
World Plaza, San Bernardino, CA (4)			55,810			09/07		1974			7,650				100.0	%			100.0	%			—
Union Town Center, Colorado Springs, CO			44,042			12/14		2003			11,212				96.8	%			100.0	%			8,245
Research Parkway, Colorado Springs, CO			10,700			8/15		2003			2,850				88.8	%			100.0	%			1,733
Total Retail Properties			110.552							$	21.712				97.65	%						$	9,978
Total Commercial Properties			834,896							$	104,712				85.1	%						$	67,932

 

(1)	Prior to January 1, 2009, “Purchase Price” includes our acquisition related costs and expenses for the purchase of the property. After January 1, 2009, acquisition related costs and expenses were recognized as expense when incurred.

 

(2)	Approximately 9,224 square feet, or 16.0% of this property, is occupied by us as our corporate offices and related parties.

 

(3)	This property is owned by two tenants-in-common, each of which owns 57% and 43%, respectively, and we beneficially own an aggregate interest of 76.4%.

 

(4)	This property is classified as held for sale as of June 30, 2021.

 

 

MODEL HOMES PORTFOLIO

 

Region		No. of Properties				Aggregate Square Feet				Approximate % of Aggregate Square Feet				Current Annual Base Rent				Approximate % of Aggregate Annual Rent				Purchase Price				Current Mortgage Balance
Southwest			85				254,901				87.8	%		$	2,635,404				84.8	%		$	34,300,302			$	22,770,938
Southeast			3				8,201				8.1	%			292,140				9.4	%			3,629,626				2,232,828
Northeast			2				6,153				2.1	%			99,276				3.2	%			1,103,000				707,396
Midwest			2				6,602				2.0	%			80,844				2.6	%			898,250				621,510
Total			92				311,102				100	%		$	3,107,664				100	%		$	39,931,178			$	26,332,673

 

 

CONSOLIDATED BALANCE SHEET

 

		June 30,				December 31,
		2021				2020
			(Unaudited)
ASSETS
Real estate assets and lease intangibles:
Land		$	17,199,715			$	18,827,000
Buildings and improvements			108,927,843				115,409,423
Tenant improvements			12,264,082				11,960,018
Lease intangibles			4,110,139				4,110,139
Real estate assets and lease intangibles held for investment, cost			142,501,779				150,306,580
Accumulated depreciation and amortization			(28,480,085	)			(26,551,789	)
Real estate assets and lease intangibles held for investment, net			114,021,694				123,754,791
Real estate assets held for sale, net			10,370,836				42,499,176
Real estate assets, net			124,392,530				166,253,967
Cash, cash equivalents and restricted cash			29,343,392				11,540,917
Deferred leasing costs, net			1,178,277				1,927,951
Goodwill			2,423,000				2,423,000
Other assets, net			3,509,354				3,422,781
TOTAL ASSETS		$	160,846,553			$	185,568,616
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net		$	89,226,919			$	94,664,266
Mortgage notes payable related to properties held for sale, net			753,439				25,365,430
Mortgage notes payable, total net			89,980,358				120,029,696
Note payable, net			—				7,500,086
Accounts payable and accrued liabilities			4,391,594				5,126,199
Accrued real estate taxes			940,701				2,548,686
Dividends payable preferred stock			95,836				—
Lease liability, net			89,251				102,323
Below-market leases, net			98,883				139,045
Total liabilities			95,596,623				135,446,035
Commitments and contingencies (Note 9)
Equity:
Series D Preferred Stock, $0.01 par value per share; 1,000,000 shares authorized; 0 and 920,000 shares issued and outstanding (liquidation preference $25.00 per share) as of June 30, 2021 and December 31, 2020, respectively			9,200				—
Series A Common Stock, $0.01 par value, shares authorized: 100,000,000; 9,508,363 shares were both issued and outstanding at June 30, 2021 and December 31, 2020, respectively			95,038				95,038
Additional paid-in capital			176,943,749				156,463,146
Dividends and accumulated losses			(125,590,168	)			(121,674,505	)
Total stockholders’ equity before noncontrolling interest			51,457,819				34,883,679
Noncontrolling interest			13,792,111				15,238,902
Total equity			65,249,930				50,122,581
TOTAL LIABILITIES AND EQUITY		$	160,846,553			$	185,568,616

 

 

CONSOLIDATED STATEMENT OF OPERATIONS

 

		For the Three Months Ended June 30,								For the Six Months Ended June 30,
			2021				2020				2021				2020
Revenues:
Rental income		$	4,553,798			$	5,879,526			$	10,031,021			$	12,665,211
Fees and other income			292,785				241,878				484,316				485,344
Total revenue			4,846,583				6,121,404				10,515,337				13,150,555
Costs and expenses:
Rental operating costs			1,485,815				1,999,834				3,324,738				4,380,926
General and administrative			1,344,770				1,278,971				2,882,036				2,630,316
Depreciation and amortization			1,368,209				1,622,230				2,797,143				3,196,756
Impairment of real estate assets			—				845,674				300,000				845,674
Total costs and expenses			4,198,794				5,746,709				9,303,917				11,053,672
Other income (expense):
Interest expense-mortgage notes			(1,207,036	)			(1,477,628	)			(2,512,057	)			(3,165,404	)
Interest expense - note payable			—				(795,728	)			(279,373	)			(1,661,798	)
Interest and other income (expense), net			(20,657	)			8,400				(53,443	)			1,405
Gain on sales of real estate, net			2,594,341				334,096				1,433,014				324,261
Gain on extinguishment of government debt			—				—				10,000				—
Income tax expense			(238,701	)			(51,369	)			(288,899	)			(135,000	)
Total other income (expense), net			1,127,947				(1,982,229	)			(1,690,758	)			(4,636,536	)
Net income (loss)			1,775,736				(1,607,534	)			(479,338	)			(2,539,653	)
Less: Loss attributable to noncontrolling interests			(925,697	)			(315,282	)			(1,332,305	)			(490,293	)
Net income (loss) attributable to Presidio Property Trust, Inc. stockholders		$	850,039			$	(1,922,816	)		$	(1,811,643	)		$	(3,029,946	)
Less: Preferred Stock Series D dividends		$	(95,836	)		$	—			$	(95,836	)		$	—
Net income (loss) attributable to Presidio Property Trust, Inc. common stockholders		$	754,203			$	(1,922,816	)		$	(1,907,479	)		$	(3,029,946	)
Net income (loss) per share attributable to Presidio Property Trust, Inc. common stockholders
Basic		$	0.08			$	(0.22	)		$	(0.20	)		$	(0.34	)
Diluted		$	0.08			$	(0.22	)		$	(0.20	)		$	(0.34	)
Weighted average number of common shares outstanding - basic & diluted			9,508,363				8,897,037				9,508,363				8,889,436

 

 

CONSOLIDATED STATEMENT OF CASH FLOWS

 

		For the Six Months Ended June 30,
		2021				2020
Cash flows from operating activities:
Net loss		$	(479,338	)		$	(2,539,653	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization			2,797,143				3,196,756
Stock compensation			582,199				361,243
Bad debt expense							51,912
Gain on sale of real estate assets, net			(1,433,014	)			(324,261	)
Gain on extinguishment of government debt			(10,000	)			—
Impairment of real estate assets			300,000				845,674
Accretion of original issue discount			—				675,603
Amortization of financing costs			371,201				733,024
Amortization of above-market leases			36,055				25,341
Amortization of below-market leases			(34,450	)			(83,586	)
Straight-line rent adjustment			(170,554	)			(160,584	)
Changes in operating assets and liabilities:
Other assets			(426,209	)			997,694
Accounts payable and accrued liabilities			(938,461	)			(1,860,992	)
Accrued real estate taxes			(1,607,985	)			(1,717,453	)
Net cash (used in) provided by operating activities			(1,013,413	)			200,718
Cash flows from investing activities:
Real estate acquisitions			(2,851,800	)			(6,292,383	)
Additions to buildings and tenant improvements			(332,508	)			(2,382,436	)
Additions to deferred leasing costs			(73,491	)			(95,151	)
Proceeds from sales of real estate, net			44,335,436				29,383,743
Net cash provided by investing activities			41,077,637				20,613,773
Cash flows from financing activities:
Proceeds from mortgage notes payable, net of issuance costs			8,003,807				7,154,117
Repayment of mortgage notes payable			(38,077,499	)			(24,171,066	)
Repayment of note payable			(7,675,598	)			(5,224,401	)
Payment of deferred offering costs			(214,982	)			(95,652	)
Distributions to noncontrolling interests, net			(2,779,096	)			(210,775	)
Issuance of Preferred Stock Series D, net of offering costs			20,489,803				—
Dividends paid to common stockholders			(2,008,184	)			—
Net cash used in financing activities			(22,261,749	)			(22,547,777	)
Net increase in cash equivalents and restricted cash			17,802,475				(1,733,286	)
Cash, cash equivalents and restricted cash - beginning of period			11,540,917				10,391,275
Cash, cash equivalents and restricted cash - end of period		$	29,343,392			$	8,657,989
Supplemental disclosure of cash flow information:
Interest paid-mortgage notes payable		$	2,400,367			$	3,089,554
Interest paid-notes payable		$	103,861			$	425,267
Unpaid deferred financing costs		$	35,000			$	91,037
Non-cash financing activities:
Issuance of stock for limited partnership interests		$	—			$	1,247,990
Dividends payable - Preferred Stock Series D		$	95,836			$	—

 

 

EBITDAre RECONCILIATION

 

		For the Three Months Ended								For the Six Months Ended
			6/30/2021				6/30/2020				6/30/2021				6/30/2020
Net (loss) income attributable to Presidio Property Trust, Inc. common stockholders		$	754,203			$	(1,922,816	)		$	(1,907,479	)		$	(3,029,946	)
Adjustments:
Interest Expense			1,207,036				2,273,356				2,791,430				4,827,202
Depreciation and Amortization			1,370,824				1,593,909				2,798,748				3,138,511
Asset Impairments			—				845,674				300,000				845,674
Net Loss on Sales of RE			(2,594,341	)			(334,096	)			(1,433,014	)			(324,261	)
Gain Extinguishment of Government Debt			—				—				(10,000	)			—
Income Taxes			238,701				51,369				288,899				135,000
EBITDAre		$	976,422			$	2,507,396			$	2,828,584			$	5,592,180

 

FFO AND CORE FFO RECONCILIATION

 

		For the Three Months Ended								For the Six Months Ended
		6/30/2021				6/30/2020				6/30/2021				6/30/2020
Net (loss) income attributable to Presidio Property Trust, Inc. common stockholders		$	754,203			$	(1,922,816	)		$	(1,907,479	)		$	(3,029,946	)
Adjustments:
Income attributable to noncontrolling interests			925,696				315,282				1,332,305				490,293
Depreciation and amortization			1,368,209				1,622,230				2,797,143				3,196,756
Amortization of above and below market leases, net			2,615				(28,321	)			1,605				(58,245	)
Impairment of real estate assets			-				845,674				300,000				845,674
Loss (gain) on sale of real estate assets, net			(2,594,341	)			(334,096	)			(1,433,014	)			(324,261	)
FFO		$	456,382			$	497,953			$	1,090,560			$	1,120,271
Restricted stock compensation			280,652				203,872				582,199				361,243
Core FFO		$	737,034			$	701,825			$	1,672,759			$	1,481,514
Weighted average number of common shares outstanding - basic and diluted			9,508,363				8,897,037				9,508,363				8,889,436
Core FFO / Wgt Avg Share		$	0.08			$	0.08			$	0.18			$	0.17

 

 

SAME STORE ANALYSIS

 

		For the Three Months Ended June 30,								Variance
		2021				2020								%
Rental revenues		$	3,647529			$	3,864754			$	(217,225	)			(5.6	)%
Rental operating costs			1,412,132				1,441,104				(28,971	)			(2.0	)%
Same Store Net operating income		$	2,235,397			$	2,423,650			$	(188,253	)			(7.8	)%
Operating Ratios:
Number of same properties			11				11
Occupancy, end of period			85.1	%			85.2	%							(0.1	)%
Operating costs as a percentage of total revenues			38.7	%			37.3	%							(1.4	)%

 

		For the Six Months Ended June 30,								Variance
		2021				2020								%
Rental revenues		$	7,465,213			$	7,816,436			$	(351,223	)			(4.5	)%
Rental operating costs			2,912,578				3,046,693				(134,115	)			(4.4	)%
Same Store Net operating income		$	4,552,635			$	4,769,743			$	(217,108	)			(4.6	)%
Operating Ratios:
Number of same properties			11				11
Occupancy, end of period			85.1	%			85.2	%							(0.1	)%
Operating costs as a percentage of total revenues			39.0	%			39.0	%							(1.4	)%

 

SEGMENT DATA

 

 

 

 

DEFINITIONS – NON-GAAP MEASUREMENTS

 

EBITDAre - EBITDAre is defined by NAREIT as earnings before interest, taxes, depreciation and amortization, gain or loss on disposal of depreciated assets, and impairment write-offs.

 

Funds from Operations (“FFO”) – The Company evaluates performance based on Funds From Operations, which we refer to as FFO, as management believes that FFO represents the most accurate measure of activity and is the basis for distributions paid to equity holders. The Company defines FFO, a non-GAAP measure, as net income or loss (computed in accordance with GAAP), excluding gains (or losses) from sales of property, hedge ineffectiveness, acquisition costs of newly acquired properties that are not capitalized and lease acquisition costs that are not capitalized plus depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges on properties or investments in non-consolidated REITs, and after adjustments to exclude equity in income or losses from, and, to include the proportionate share of FFO from, non-consolidated REITs.

 

However, because FFO excludes depreciation and amortization as well as the changes in the value of the Company’s properties that result from use or market conditions, each of which have real economic effects and could materially impact the Company’s results from operations, the utility of FFO as a measure of the Company’s performance is limited. In addition, other REITs may not calculate FFO in accordance with the NAREIT definition as the Company does, and, accordingly, the Company’s FFO may not be comparable to other REITs’ FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of the Company’s performance.

 

Core Funds from Operations (“Core FFO”) – We calculate Core FFO, a non-GAAP measure, by using FFO as defined by NAREIT and adjusting for certain other non-core items. We also exclude from our Core FFO calculation acquisition costs, loss on early extinguishment of debt, changes in the fair value of the earn-out, changes in fair value of contingent consideration and the amortization of stock-based compensation.

 

We believe Core FFO provides a useful metric in comparing operations between reporting periods and in assessing the sustainability of our ongoing operating performance. Other equity REITs may calculate Core FFO differently or not at all, and, accordingly, the Company’s Core FFO may not be comparable to such other REITs’ Core FFO.

 

Same Store Net Operating Income (“Same Store NOI”) – Same Store NOI, a non-GAAP measure, is calculated as the net operating income attributable to the properties continuously owned and operated for the entirety of the reporting periods presented. The Company’s definition of Same Store NOI excludes properties that were not stabilized during both of the applicable reporting periods. These exclusions may include, but are not limited to, acquisitions, dispositions and properties undergoing repositioning or significant renovations.

 

The Company evaluates the performance of its same-store property operating results based upon net operating income from continuing operations, which is a non-GAAP supplemental financial measure. The Company defines NOI as operating revenues (rental income, tenant reimbursements and other operating income) less property and related expenses (property operating expenses, real estate taxes, insurance and provision for bad debt) less interest expense. NOI excludes certain items that are not considered to be controllable in connection with the management of an asset such as non-property income and expenses, depreciation and amortization, asset management fees and corporate general and administrative expenses. The Company believes that net income is the GAAP measure that is most directly comparable to NOI; however, NOI should not be considered as an alternative to net income as the primary indicator of operating performance as it excludes the items described above.

 

We believe Same Store NOI, a non-GAAP measure, is an important measure of comparison because it allows for comparison of operating results of stabilized properties owned and operated for the entirety of both applicable periods and therefore eliminates variations caused by acquisitions, dispositions or repositioning during such periods. Other REITs may calculate Same Store NOI differently and our calculation should not be compared to that of other REITs.