Apartment Investment and Management Company ("Aimco") (NYSE: AIV) announced today its fourth quarter and full year 2013 results.

Chairman and Chief Executive Officer Terry Considine comments: "Aimco enjoyed a solid 2013. Profitability was up, with AFFO increasing 14% year-over-year. Portfolio quality was up, with average revenue per apartment home increasing 8%. Redevelopment and development investment doubled to $194 million. Our balance sheet is stronger, with leverage to EBITDA down 0.5x.

Looking forward, we expect another good year in 2014. Rent growth is expected to remain strong, although slowing somewhat. With lower interest expense and lower overhead costs, we expect profitability to be up again, with AFFO increasing by 10%.

Future results will also be strongly influenced by our portfolio management. Over the past two years, we have sold approximately 18,000 apartment homes, eliminating the related property management costs and Capital Replacement spending. We have reinvested sales proceeds in fewer apartment homes with higher rents, higher margins and greater expected growth. As a result, Free Cash Flow and AFFO are growing faster than Net Operating Income and FFO.

These results and prospects support the Board's decision to increase the dividend by 8% for 2014."

Chief Financial Officer Ernie Freedman adds: "Fourth quarter AFFO exceeded the midpoint of guidance by $0.02 per share, and Pro forma FFO beat the midpoint of guidance by $0.01 per share. Our balance sheet was strong at year-end with total leverage, as a ratio to fourth quarter EBITDA, annualized, at 7.2x, down from 7.7x one year ago. Our year-end unencumbered pool was $380 million, an important milestone on our path to an investment grade rating.

Looking forward, we project 2014 Conventional Same Store revenues to increase 3% to 4% compared to 2013. Revenues from the strong California markets are expected to account for approximately 25% of total 2014 revenues, and approximately 30% for 2015. 2014 redevelopment and development investment will be funded by committed loans and property sales. Interest expense will be down. Offsite costs will be lower.

Taking all together and at the midpoint of guidance, we expect AFFO to be up by 10%."

Financial Results: Full Year 2013 AFFO Up 14%, Pro forma FFO Up 11%

    FOURTH QUARTER     FULL YEAR
(all items per common share)     2013     2012     2013     2012
Net income     $ 0.84       $ 0.47       $ 1.40       $ 0.61  
Funds From Operations (FFO)     $ 0.57       $ 0.52       $ 2.04       $ 1.68  
Add back Aimco's share of preferred equity redemption related amounts     $ --       $ --       $ --       $ 0.16  
Pro forma Funds From Operations (Pro forma FFO)     $ 0.57       $ 0.52       $ 2.04       $ 1.84  
Deduct Aimco's share of Capital Replacements     $ (0.14 )     $ (0.14 )     $ (0.51 )     $ (0.50 )
Adjusted Funds From Operations (AFFO)     $ 0.43       $ 0.38       $ 1.53       $ 1.34  
       

Pro forma FFO - Year-over-year, fourth quarter Pro forma FFO increased 10% as a result of improved property operating results and lower offsite costs. These positive results were somewhat offset by higher interest expense and lower income from discontinued operations.

Adjusted Funds from Operations - Fourth quarter AFFO increased 13% when compared to fourth quarter 2012, as a result of Pro forma FFO growth. An increase in 2013 Capital Replacement spending related to multi-phase capital projects was offset by a reduction in Standard Capital Replacements due to the sale of approximately 18,000 apartment homes during 2012 and 2013. As Aimco concentrates its investment capital in higher quality, higher price-point properties, Capital Replacements decline as a percentage of net operating income. As a result, AFFO, up 14% when compared to full year 2012, is increasing at a faster rate than is Pro forma FFO, up 11% when compared to full year 2012.

Operating Results: Full Year Conventional Same Store NOI Up 5.1%

Conventional Same Store Results

    FOURTH QUARTER     FULL YEAR
Year-over-Year     Sequential Year-over-Year
      2013     2012     Variance     3rd Qtr     Variance     2013     2012     Variance
Average Rent Per Apartment Home     $1,287     $1,250     3.0 %     $1,283     0.3 %     $1,273     $1,227     3.7 %
Other Income Per Apartment Home     154     143     7.7 %     157     (1.9 )%     153     138     10.9 %
Average Revenue Per Apartment Home     $1,441     $1,393     3.5 %     $1,440     0.1 %     $1,426     $1,365     4.5 %
Average Daily Occupancy     95.5%     95.3%     0.2 %     95.3%     0.2 %     95.4%     95.6%     (0.2 )%
                                                 
$ in Millions                                                
Revenue     $181.2     $174.6     3.8 %     $180.6     0.3 %     $716.6     $686.6     4.4 %
Expenses     59.1     58.6     0.8 %     61.4     (3.7 )%     243.6     236.4     3.0 %
NOI     $122.1     $116.0     5.2 %     $119.2     2.4 %     $473.0     $450.2     5.1 %
                   

Rental Rates - Aimco measures changes in rental rates by comparing, on a lease-by-lease basis, the rate on a newly executed lease to the rate on the expiring lease for that same apartment. Newly executed leases are classified either as a new lease, where a vacant apartment is leased to a new customer, or as a renewal.

2013     1st Qtr     2nd Qtr     3rd Qtr     Oct     Nov     Dec     4th Qtr    

Full
Year

    

Jan
2014

Renewal rent increases     5.3%     5.2%     5.1%     4.5%     4.9%     4.4%     4.6%     5.1%     4.6%
New lease rent increases     2.6%     3.1%     1.7%     0.8%     (0.9)%     (1.9)%     (0.6)%     1.5%     0.0%
Weighted average rent increases     3.9%     4.1%     3.3%     2.9%     1.9%     1.0%     2.0%     3.3%     2.3%
                                   

Portfolio Management: Revenue Per Apartment Home Up 7.9% to $1,469

Aimco's portfolio strategy seeks predictable rent growth from a portfolio of "A", "B" and "C" quality market-rate properties, averaging "B/B+" in quality, and diversified among the largest coastal and job growth markets in the U.S., as measured by total apartment value. Aimco's target markets are primarily coastal markets, and also include several Sun Belt cities and Chicago, Illinois.

Aimco measures asset quality based on rents compared to local market average rents as reported by REIS, a third-party provider of commercial real estate performance information and analysis. Aimco defines asset quality as follows: "A" quality assets are those with rents greater than 125% of local market average; "B" quality assets are those with rents 90% to 125% of local market average; and "C" quality assets are those with rents lower than 90% of local market average. For third quarter 2013, the most recent period for which REIS information is available, Aimco's Conventional Property rents averaged 105% of local market average rents.

Aimco expects to sell each year the lowest-rated 5% to 10% of its portfolio and to invest the proceeds from such sales in redevelopment and acquisition of higher-quality properties. Through this disciplined approach to capital recycling, from 2010 through 2013, Aimco increased its year-end Conventional portfolio average revenue per apartment home at a compound annual growth rate of 8.4%. This rate of growth reflects the impact of market rent growth, but more significantly, the impact of portfolio management through dispositions, redevelopment and acquisitions.

Fourth quarter 2013 Conventional portfolio average revenue per apartment home was $1,469, a 7.9% increase compared to fourth quarter 2012, as a result of year-over-year revenue per apartment home growth of 3.5% and the sale of Conventional Properties during 2012 and 2013 with average revenues per apartment home substantially lower than those of the retained portfolio and reinvestment of the proceeds in higher-rent properties through redevelopment and acquisitions.

Dispositions - In fourth quarter 2013, Aimco sold eleven Conventional Properties and five Affordable Properties with 3,619 and 824 apartment homes, respectively, for $333.8 million in gross proceeds. Aimco's share of net sales proceeds after distributions to limited partners, repayment of existing property debt and transaction costs was $142.8 million. The wind down of Aimco's Affordable portfolio continued with the reduction from 228 properties three years ago to 74 properties at the end of fourth quarter 2013.

Redevelopment and Development: Full Year Investment Totals $194 Million

During the fourth quarter, Aimco completed the redevelopment of its Elm Creek property, located in Elmhurst, Illinois, and continued the redevelopment of four other properties that began during 2012. In addition, Aimco substantially completed the Capital Replacement and Capital Improvement phase of its multi-phase capital projects at 2900 on First, located in Seattle, and Park Towne Place and The Sterling, both located in Center City Philadelphia. During the fourth quarter, Aimco began the redevelopment phase of the project at The Sterling, which includes renovation of common areas and commercial space, as well as the upgrade of 69 apartment homes. Additional apartment homes may be upgraded in the future. Redevelopment of 2900 on First and Park Towne Place is expected to begin during 2014.

During the fourth quarter, Aimco broke ground on its One Canal Street development in Boston. Over the next two and one-half years, Aimco expects to invest approximately $190 million to construct 310 luxury apartment homes, approximately 22,000 square feet of commercial space and 147 parking spaces.

Balance Sheet and Liquidity: Leverage on Target

Components of Aimco Leverage

    AS OF DECEMBER 31, 2013
$ in Millions     Amount     % of Total    

Weighted Avg.
Maturity (Yrs.)

    

Weighted
Avg Rate

Aimco's share of long-term, non-recourse property debt     $ 4,195.6      

96%

    8.2     5.31%
Outstanding borrowings on revolving credit facility     50.4      

1%

    4.8     3.75%
Preferred securities     148.0      

3%

    Perpetual     6.22%
Total leverage     $ 4,394.0      

100%

    n/a     5.32%
           

Leverage Ratios

Aimco's leverage targets are: Debt and Preferred Equity to EBITDA less than 7.0x; and EBITDA Coverage of Interest and Preferred Dividends greater than 2.5x. Aimco also focuses on Debt to EBITDA and EBITDA Coverage of Interest ratios. See the Glossary for definitions of these metrics.

      2013     2012
     

Trailing-
Twelve-Month

    

Annualized
4th Qtr

    

Trailing-
Twelve-Month

    

Annualized
4th Qtr

Debt to EBITDA     7.1x     6.9x     7.5x     7.4x
Debt and Preferred Equity to EBITDA     7.3x     7.2x     7.8x     7.7x
EBITDA Coverage of Interest     2.6x     2.7x     2.4x     2.5x
EBITDA Coverage of Interest and Preferred Dividends     2.5x     2.6x     2.1x     2.4x
               

Future leverage reduction is expected both from earnings growth and from regularly scheduled property debt amortization funded from retained earnings.

Liquidity

Aimco's recourse debt at December 31, 2013, was limited to its revolving credit facility, which Aimco uses for working capital and other short-term purposes, and to secure letters of credit.

At the end of the fourth quarter, Aimco had outstanding borrowings on its revolving credit facility of $50.4 million and available capacity was $505.0 million, net of $44.6 million of letters of credit backed by the facility. At the end of the fourth quarter, Aimco's share of cash and restricted cash on hand was $167.5 million. In addition, Aimco holds seven properties in its unencumbered asset pool with a total estimated fair value of approximately $380 million.

Equity Activity

Dividend - As previously announced, Aimco's Board of Directors declared a quarterly cash dividend of $0.26 per share of Class A Common Stock for the quarter ended December 31, 2013, an increase of 8% compared to dividends paid during 2013. The fourth quarter 2013 dividend is payable on February 28, 2014, to stockholders of record on February 14, 2014.

2014 Outlook

($ Amounts Represent Aimco Share)     FULL YEAR

2014

     FULL YEAR

2013

             
Net income per share     $0.30 to $0.40     $1.40
Pro forma FFO per share     $2.00 to $2.10     $2.04
AFFO per share     $1.63 to $1.73     $1.53
             
Conventional Same Store Operating Measures            
NOI change compared to 2013     3.0% to 5.0%     5.1%
Revenue change compared to 2013     3.0% to 4.0%     4.4%
Expense change compared to 2013     2.0% to 3.0%     3.0%
             
Investment Management Income            
Recurring revenues     $27 million     $30.3 million
Non-recurring revenues     $0 to $2 million     $12.3 million
Historic Tax Credit Benefit [1]     $10 to $11 million     $3.9 million
             
Offsite Costs            
Property management expenses     $27 million     $30.7 million
General and administrative expenses     $44 million     $45.5 million
Investment management expenses     $4 million     $4.3 million
             
Capital Investments            
Redevelopment     $125 to $150 million     $178.3 million
Development     $60 to $70 million     $15.9 million
Property upgrades [2]     $40 to $45 million     $39.1 million
Capital Replacements ($1,000 per unit)     $55 million     $75.4 million
             
Transaction and Financing Activities            
Real estate value of property dispositions [3]     $300 to $350 million     $406.1 million
Aimco net proceeds from property dispositions [4]     $180 to $220 million     $202.7 million
Real estate value of unencumbered properties [5]     $525 to $575 million     $380 million
       
 

First Quarter 2014 Outlook

        FIRST

QUARTER

         
Net income per share       $0.03 to $0.07
Pro forma FFO per share       $0.46 to $0.50
AFFO per share       $0.38 to $0.44
         
Conventional Same Store Operating Measures        
NOI change compared to first quarter 2013       3.75% to 4.75%
NOI change compared to fourth quarter 2013       -3.0% to -2.0%

Please refer to notes on page 7.

2014 Pro forma FFO Reconciliation

($ Per share at the midpoint of Aimco's guidance range)        
         
2013 Pro forma FFO       $2.04
         
Conventional Same Store NOI growth (4.0% at the midpoint of guidance) [6]       0.11  
Conventional Non-Same Store NOI growth ($0.07 Redevelopment contribution) [7]       0.08  
Total NOI growth       0.19  
         
Impact of:        
2013 asset sales (see Discontinued Operations in Supplemental Schedule 1)       (0.10 )
2014 asset sales ($0.13 lost NOI, $0.03 lost interest expense) [3] [6]       (0.10 )
2013 acquisitions and partnership transactions ($0.02 new NOI, $0.01 new interest expense)       0.01  
Reductions in offsite costs due to change in scale and efficiencies       0.04  
Change in interest expense [8]       0.05  
Decrease in non-recurring revenues [9]       (0.08 )
Decrease in recurring asset management and tax credit revenues       (0.02 )
Decrease in interest income [9]       (0.03 )
Increase in income tax benefit [1]       0.05  
         
2014 Pro forma FFO       $2.05
     
 

2014 AFFO Reconciliation

($ Per share at the midpoint of Aimco's guidance range)        
         
2013 AFFO     $1.53  
         
Pro forma FFO growth     0.01  
Capital Replacement spending related to multi-phase capital projects     0.12  
Impact of 2013 and 2014 asset sales on Capital Replacement spending     0.02  
         
2014 AFFO     $1.68  
2014 AFFO Growth     10 %

Please refer to notes on the following page.

Notes to 2014 Outlook, 2014 Pro forma FFO and AFFO Reconciliations

[1]   During 2012, Aimco sought and was awarded Historic Tax Credits related to the redevelopment of its Lincoln Place property, which Aimco planned to syndicate in 2013. As discussed on Aimco's fourth quarter 2012 earnings conference call, Aimco's initial 2013 guidance included non-recurring income of approximately $5 million related to such syndication, which was expected to be recognized in the fourth quarter 2013. During 2013, Aimco determined that the most economic use of these Historic Tax Credits was not to syndicate them but rather to use them to offset tax associated with income generated by Aimco's Taxable REIT Subsidiary ("TRS"). During 2013, Aimco recognized $3.9 million of these Historic Tax Credits, which offset tax associated with income generated by its TRS and resulted in an overall income tax benefit of $2.6 million. One of the largest sources of income in Aimco's TRS is the amortization of income from the syndication of Low Income Housing Tax Credits in prior years, which is detailed on Supplemental Schedule 3 to this earnings release. In 2014, Aimco expects to recognize an additional $10 to $11 million of Historic Tax Credits related to Lincoln Place, and tax associated with income generated by Aimco's TRS is projected to be minimal. As such, Aimco expects to recognize an overall income tax benefit in 2014 approximating the amount of the Lincoln Place Historic Tax Credits, after which point the Historic Tax Credits will have been fully recognized.
[2] Property upgrades may include kitchen and bath remodeling; energy conservation projects; and investments in longer-lived materials designed to reduce turnover costs, such as simulated wood flooring and granite countertops.
[3] During 2014, Aimco intends to sell $250 to $290 million of Conventional Properties and $50 to $60 million of Affordable Properties. Unlike 2013, where the majority of Conventional Property sales occurred in the second half of the year, almost all 2014 Conventional Property sales are expected to occur in the first half of the year. Aimco intends to continue to dispose of its Affordable Properties. If successful, Aimco will hold at the end of 2014 56 Affordable properties with approximately 8,500 units, most of which were redeveloped with Low Income Housing Tax Credits, generally between 2005 and 2009. These properties are expected to be sold as their 10-year tax credit delivery periods expire with the majority of sales expected between 2015 and 2019.
[4] Aimco intends to use proceeds from property sales to fund real estate investments including redevelopment, development, and other capital investments.
[5] Anticipated size of unencumbered pool at December 31, 2014, based on December 31, 2013, values.
[6] Conventional Same Store guidance for 2014 excludes six properties with 2,885 apartment homes that were sold in January 2014 or are expected to be sold in 2014.
[7] Stabilization of Aimco's redevelopment projects at Lincoln Place, Pacific Bay Vistas and Preserve at Marin will occur in 2014 or 2015 (please refer to Supplemental Schedule 10 to this earnings release). In 2015, these three projects are expected to contribute to AFFO per share $0.06 more than in 2014, and to FFO per share $0.07 more than in 2014.
[8] Represents change in interest expense from lower average debt balances and lower interest rates in 2013 and anticipated for 2014, offset by lower capitalized interest due to the anticipated completion of redevelopment activities at Lincoln Place, Pacific Bay Vistas, and Preserve at Marin. Interest expense changes from sales and acquisition activities are noted separately on their above referenced lines.
[9] During 2013, Aimco was repaid in full notes receivable secured by certain properties in the West Harlem area of New York City, resulting in a reduction in expected interest income in 2014. Note that 2013 interest income of $16.7 million includes approximately $5 million of income that, due to its nature, is classified as interest income for GAAP purposes. However, because this income was recognized as part of a property sale, Aimco has included the amount in non-recurring revenues for its guidance comparison and Pro forma FFO reconciliation.
 

Earnings Conference Call Information

Live Conference Call:     Conference Call Replay:
Friday, February 7, 2014 at 1:00 p.m. ET Replay available until 9:00 a.m. ET on February 24, 2014
Domestic Dial-In Number: 1-888-317-6003 Domestic Dial-In Number: 1-877-344-7529
International Dial-In Number: 1-412-317-6061 International Dial-In Number: 1-412-317-0088
Passcode: 1382736 Passcode: 10039219

Live webcast and replay: http://www.aimco.com/investors/events-presentations/webcasts

Supplemental Information

The full text of this Earnings Release and the Supplemental Information referenced in this release are available on Aimco's website at http://www.aimco.com/investors/financial-reports/quarterly-earning-reports.

Glossary & Reconciliations of Non-GAAP Financial and Operating Measures

Financial and operating measures found in this Earnings Release and the Supplemental Information include certain financial measures used by Aimco management that are not calculated in accordance with accounting principles generally accepted in the United States, or GAAP. These measures are defined in the Glossary in the Supplemental Information and, where appropriate, reconciled to the most comparable GAAP measures.

About Aimco

Aimco is a real estate investment trust that is focused on the ownership and management of quality apartment communities located in the largest markets in the United States. Aimco is one of the country's largest owners and operators of apartments, with 236 communities in 23 states, the District of Columbia and Puerto Rico. Aimco common shares are traded on the New York Stock Exchange under the ticker symbol AIV, and are included in the S&P 500. For more information about Aimco, please visit our website at www.aimco.com.

Forward-looking Statements

This Earnings Release and Supplemental Information contain forward-looking statements within the meaning of the federal securities laws, including, without limitation, statements regarding projected results and specifically forecasts of: first quarter and full year 2014 results, including but not limited to Pro forma FFO and selected components thereof; AFFO; and Aimco's development and redevelopment project investments, timelines and stabilized rents. These forward-looking statements are based on management's judgment as of this date and include certain risks and uncertainties. Risks and uncertainties include, but are not limited to: Aimco's ability to maintain current or meet projected occupancy, rental rates and property operating results; the effect of acquisitions, dispositions, developments and redevelopments; our ability to meet budgeted costs and timelines, and achieve budgeted rental rates related to our development and redevelopment projects; and our ability to comply with debt covenants, including financial coverage ratios.

Actual results may differ materially from those described in these forward-looking statements and, in addition, will be affected by a variety of risks and factors, some of which are beyond the control of Aimco, including, without limitation: financing risks, including the availability and cost of capital markets financing and the risk that our cash flows from operations may be insufficient to meet required payments of principal and interest; the risk that our earnings may not be sufficient to maintain compliance with debt covenants; real estate risks, including fluctuations in real estate values and the general economic climate in the markets in which we operate and competition for residents in such markets; national and local economic conditions, including the pace of job growth and the level of unemployment; the terms of governmental regulations that affect Aimco and interpretations of those regulations; the competitive environment in which Aimco operates; the timing of acquisitions, dispositions, developments and redevelopments; insurance risk, including the cost of insurance; natural disasters and severe weather such as hurricanes; litigation, including costs associated with prosecuting or defending claims and any adverse outcomes; energy costs; and possible environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of properties presently owned or previously owned by Aimco. In addition, Aimco's current and continuing qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code and depends on its ability to meet the various requirements imposed by the Internal Revenue Code, through actual operating results, distribution levels and diversity of stock ownership.

Readers should carefully review Aimco's financial statements and the notes thereto, as well as the section entitled "Risk Factors" in Item 1A of Aimco's Annual Report on Form 10-K for the year ended December 31, 2012, and the other documents Aimco files from time to time with the Securities and Exchange Commission. These forward-looking statements reflect management's judgment as of this date, and Aimco assumes no obligation to revise or update them to reflect future events or circumstances. This press release does not constitute an offer of securities for sale.

 
Consolidated Statements of Operations
(in thousands, except per share data) (unaudited)
               
Three Months Ended Year Ended
December 31, December 31,
2013 2012 2013 2012
REVENUES
Rental and other property revenues $ 238,498 $ 233,617 $ 939,231 $ 916,742
Tax credit and asset management revenues 12,364   14,088   34,822   41,769  
Total revenues 250,862   247,705   974,053   958,511  
OPERATING EXPENSES
Property operating expenses 93,608 93,620 375,672 374,347
Investment management expenses 838 2,563 4,341 12,008
Depreciation and amortization 70,322 80,436 291,910 325,173
Provision for real estate impairment losses -- -- -- 6,235
General and administrative expenses 11,814 12,111 45,708 49,602
Other expense, net 1,125   3,608   7,403   12,130  
Total operating expenses 177,707   192,338   725,034   779,495  
Operating income 73,155 55,367 249,019 179,016
Interest income 3,174 2,478 16,059 9,890
Recovery of losses on notes receivable, net 2,116 3,943 1,884 3,375
Interest expense (61,323 ) (53,906 ) (237,048 ) (229,373 )
Equity in income (losses) of unconsolidated real estate partnerships 21 (1,609 ) 926 (4,408 )
Gain on dispositions and other, net 7,515   1,257   1,797   21,886  
Income (loss) before income taxes and discontinued operations 24,658 7,530 32,637 (19,614 )
Income tax benefit 2,146   309   1,959   858  
Income (loss) from continuing operations 26,804 7,839 34,596 (18,756 )
Income from discontinued operations, net 121,799   89,409   203,229   214,117  
Net income 148,603 97,248 237,825 195,361
Noncontrolling interests:
Net income attributable to noncontrolling interests in consolidated real estate partnerships (16,809 ) (22,454 ) (12,473 ) (51,218 )
Net income attributable to preferred noncontrolling interests in Aimco Operating Partnership (1,605 ) (1,606 ) (6,423 ) (6,496 )
Net income attributable to common noncontrolling interests in Aimco Operating Partnership (6,971 ) (4,262 ) (11,639 ) (5,191 )
Net income attributable to noncontrolling interests (25,385 ) (28,322 ) (30,535 ) (62,905 )
Net income attributable to Aimco 123,218 68,926 207,290 132,456
Net income attributable to Aimco preferred stockholders (699 ) (752 ) (2,804 ) (49,888 )
Net income attributable to participating securities (482 ) (246 ) (813 ) (422 )
Net income attributable to Aimco common stockholders $ 122,037   $ 67,928   $ 203,673   $ 82,146  
Weighted average common shares outstanding - basic 145,341   145,035   145,291   134,479  
Weighted average common shares outstanding - diluted 145,499   145,035   145,532   134,479  
Earnings (loss) per common share - basic and diluted:
Income (loss) from continuing operations attributable to Aimco common stockholders $ 0.25 $ (0.01 ) $ 0.29 $ (0.60 )
Income from discontinued operations attributable to Aimco common stockholders 0.59   0.48   1.11   1.21  
Net income attributable to Aimco common stockholders $ 0.84   $ 0.47   $ 1.40   $ 0.61  
 
 
Consolidated Statements of Operations (continued)
Income from Discontinued Operations
Income from discontinued operations consists of the following (in thousands):
               
Three Months Ended Year Ended
December 31, December 31,
2013 2012 2013 2012
Rental and other property revenues $ 6,917 $ 24,142 $ 62,152 $ 140,634
Property operating expenses (5,224 ) (11,815 ) (30,695 ) (62,781 )
Depreciation and amortization (1,914 ) (6,323 ) (16,372 ) (41,577 )
(Provision for) recovery of real estate impairment losses --   (4,049 ) 16   (17,452 )
Operating (loss) income (221 ) 1,955 15,101 18,824
Interest income 27 139 343 568
Interest expense (1,273 ) (5,465 ) (13,346 ) (29,972 )
(Loss) income before gain on dispositions of real estate and income taxes (1,467 ) (3,371 ) 2,098 (10,580 )
Gain on dispositions of real estate 131,805 94,603 212,459 234,530
Income tax expense (8,539 ) (1,823 ) (11,328 ) (9,833 )
Income from discontinued operations, net $ 121,799   $ 89,409   $ 203,229   $ 214,117  
Income from discontinued operations attributable to:
Noncontrolling interests in consolidated real estate partnerships $ (31,294 ) $ (15,574 ) $ (31,842 ) $ (41,633 )
Noncontrolling interests in Aimco Operating Partnership (4,939 ) (4,212 ) (9,248 ) (10,238 )
Total noncontrolling interests (36,233 ) (19,786 ) (41,090 ) (51,871 )
Income from discontinued operations attributable to Aimco $ 85,566   $ 69,623   $ 162,139   $ 162,246  
 
 
Consolidated Balance Sheets
(in thousands) (unaudited)
       
December 31, 2013 December 31, 2012
ASSETS
Buildings and improvements $ 6,332,723 $ 6,014,062
Land 1,881,358   1,857,956  
Total real estate 8,214,081 7,872,018
Accumulated depreciation (2,822,872 ) (2,637,057 )
Net real estate 5,391,209 5,234,961
Cash and cash equivalents 55,751 84,413
Restricted cash 127,037 145,585
Notes receivable, net 3,145 102,897
Other assets 502,271 543,778
Assets held for sale --   289,746  
Total assets $ 6,079,413   $ 6,401,380  
LIABILITIES AND EQUITY
Non-recourse property debt $ 4,337,785 $ 4,413,083
Revolving credit facility borrowings 50,400   --  
Total indebtedness 4,388,185 4,413,083
Accounts payable 43,161 30,747
Accrued liabilities and other 287,595 313,611
Deferred income 107,775 127,561
Liabilities related to assets held for sale --   281,438  
Total liabilities 4,826,716   5,166,440  
Preferred noncontrolling interests in Aimco Operating Partnership 79,953 80,046
Equity:
Perpetual Preferred Stock 68,114 68,114
Class A Common Stock 1,459 1,456
Additional paid-in capital 3,701,339 3,712,684
Accumulated other comprehensive loss (4,602 ) (3,542 )
Distributions in excess of earnings (2,798,853 ) (2,863,287 )
Total Aimco equity 967,457   915,425  
Noncontrolling interests in consolidated real estate partnerships 233,008 271,065
Common noncontrolling interests in Aimco Operating Partnership (27,721 ) (31,596 )
Total equity 1,172,744   1,154,894  
Total liabilities and equity $ 6,079,413   $ 6,401,380  

Aimco
Elizabeth Coalson, 303-691-4350
Vice President Investor Relations
investor@aimco.com