Post Properties Inc : Post Properties Announces Second Quarter 2012 Earnings
07/30/2012| 04:15pm US/Eastern
Recommend:
0
Investor/Analyst Conference Call Scheduled for Tuesday, July 31 at 10:00
a.m. EDT
Post Properties, Inc. (NYSE: PPS) announced today net income available
to common shareholders of $20.2 million, or $0.37 per diluted share, for
the second quarter of 2012, compared to net income of $8.8 million, or
$0.17 per diluted share, for the second quarter of 2011.
Net income available to common shareholders for the six months ended
June 30, 2012, was $41.0 million, or $0.76 per diluted share, compared
to net income of $8.4 million, or $0.17 per diluted share, for the six
months ended June 30, 2011.
The Company's net income available to common shareholders for the three
and six months ended June 30, 2012 included other income of $0.9 million
relating primarily to a construction litigation settlement, and for the
six months ended June 30, 2012 included a gain of $6.1 million on the
sale of an asset. The Company's net income available to common
shareholders for the three and six months ended June 30, 2011 included a
$0.4 million gain on the sale of a technology investment and for the six
months ended June 30, 2011 included $1.8 million of costs associated
with the redemption of preferred stock.
Funds From Operations
The Company uses the National Association of Real Estate Investment
Trusts ("NAREIT") definition of Funds from Operations ("FFO") as an
operating measure of the Company's financial performance. A
reconciliation of FFO to GAAP net income is included in the financial
data (Table 1) accompanying this press release.
FFO for the second quarter of 2012 was $39.7 million, or $0.73 per
diluted share, compared to $27.7 million, or $0.55 per diluted share,
for the second quarter of 2011. The Company's reported FFO for the
second quarter of 2012 included the other income discussed above, of
$0.9 million, or $0.02 per diluted share, and for the second quarter of
2011 included the technology sale gain of $0.4 million, or $0.01 per
diluted share.
FFO for the six months ended June 30, 2012 was $73.9 million, or $1.37
per diluted share, compared to $46.0 million, or $0.92 per diluted
share, for the six months ended June 30, 2011. The Company's reported
FFO for the first half of 2012 included the $0.9 million of other income
discussed above, or $0.02 per diluted share. The Company's reported FFO
for the first half of 2011 included costs related to the redemption of
preferred stock, offset by the technology sale gain discussed above,
totaling a net reduction to FFO of $1.3 million, or $0.03 per diluted
share.
Said Dave Stockert, Post's CEO, "We are very pleased to deliver another
strong quarter of nearly 30% growth in per share core funds from
operations. We sustained a solid pace of year-over-year and sequential
growth in revenues from our apartment communities, and achieved an
outsized number of condominium closings. As a result, we've again
adjusted earnings guidance for the full year. In July, we added another
high-quality community to the Post portfolio, and are off to a good
start leasing up our first new development delivery of this current
cycle."
Same Store Community Data
Average economic occupancy at the Company's 50 same store communities,
containing 18,114 apartment units, was 96.1% and 95.1% for the second
quarter of 2012 and 2011, respectively.
Total revenues for the same store communities increased 7.8% and total
operating expenses increased 3.9% during the second quarter of 2012,
compared to the second quarter of 2011, resulting in a 10.4% increase in
same store net operating income ("NOI"). The average monthly rental rate
per unit increased 6.5% during the second quarter of 2012, compared to
the second quarter of 2011.
On a sequential basis, total revenues for the same store communities
increased 2.5% and total operating expenses increased 2.4%, producing a
2.5% increase in same store NOI for the second quarter of 2012, compared
to the first quarter of 2012. On a sequential basis, the average monthly
rental rate per unit increased 1.6%. For the second quarter of 2012,
average economic occupancy at the same store communities was 96.1%,
compared to 95.8% for the first quarter of 2012.
For the six months ended June 30, 2012, average economic occupancy at
the Company's mature communities was 96.0%, compared to 95.0% for the
six months ended June 30, 2011.
Total revenues for the mature communities increased 7.8% and total
operating expenses increased 3.5% during the first half of 2012,
compared to the first half of 2011, resulting in a 10.7% increase in
same store NOI. The average monthly rental rate per unit increased 6.3%
for the six months ended June 30, 2012, compared to the six months ended
June 30, 2011.
Same store NOI is a supplemental non-GAAP financial measure. A
reconciliation of same store NOI to the comparable GAAP financial
measure is included in the financial data (Table 2) accompanying this
press release. Information on same store NOI and average rental rate per
unit by geographic market is also included in the financial data (Table
3) accompanying this press release.
Development Activity
During the second quarter of 2012, the Company began delivering units at
the second phase of its Post Carlyle Square? community in Washington,
D.C. The Company also reduced the estimated total cost of the project by
$6.0 million. As of July 27, 2012, this community was 20% leased.
In the aggregate, the Company has 1,810 units in six apartment
communities, and approximately 37,567 square feet of retail space, under
development or in lease-up with a total estimated cost of $300.4
million. The Company currently expects to fund future estimated
construction expenditures primarily by utilizing available borrowings
under its unsecured bank credit facilities as well as proceeds from its
on-going condominium sales and its at-the-market common equity sales
program.
Acquisition Activity
As previously announced in July, the Company acquired Post South End?, a
360-unit apartment community located in Charlotte, North Carolina for a
purchase price of $74.0 million. This community was completed in 2009
and also includes approximately 7,612 square feet of retail space.
Financing Activity
Leverage, Line and Term Loan Capacity
Total debt and preferred equity as a percentage of undepreciated real
estate assets (adjusted for joint venture partners' share of real estate
assets and debt) was 35.7% at June 30, 2012.
On May 31, 2012, the Company borrowed an additional $130 million under
its unsecured bank term loan facility. On June 1, 2012, the Company
repaid in full its $95.7 million of outstanding 5.45% senior unsecured
notes. On July 2, 2012, the Company borrowed the remaining $70 million
of available capacity under the term loan, bringing total outstanding
borrowings under the term loan facility to $300 million.
As of July 27, 2012, the Company had cash and cash equivalents of $38.7
million. The Company had no outstanding borrowings and had letters of
credit totaling $0.6 million under its combined $330 million unsecured
lines of credit.
Computations of debt ratios and reconciliations of the ratios to the
appropriate GAAP measures in the Company's financial statements are
included in the financial data (Table 4) accompanying this press release.
At-the-Market Common Equity Activity
The Company's initial at-the-market common equity program provides for
the sale of up to 4 million shares of common stock, of which 136,500
shares remain available for issuance as of July 27, 2012. Upon that
program's completion, the Company also has available a second
at-the-market common equity program that provides for the sale of up to
an additional 4 million shares of common stock. The Company expects to
use these programs as an additional source of capital and liquidity, to
maintain the strength of its balance sheet and to fund its planned
investment activities. Sales under these programs will be dependent upon
a variety of factors, including, among others, market conditions, the
trading price of the Company's common stock and the potential use of
proceeds.
During the second quarter of 2012, the Company sold 96,500 shares under
the initial program, at an average gross price of $50.23 per share,
producing net proceeds of $4.6 million. Since its inception, the Company
has sold 3,863,500 shares, at an average gross price per share of
$41.14, producing net proceeds of $155.4 million.
Condominium Activity
During the second quarter of 2012, the Company closed 26 condominium
units at its Austin and Atlanta condominium projects for aggregate gross
revenue of $22.9 million. As of July 27, 2012, the Company has, in the
aggregate, closed 164 units at the Austin and Atlanta condominium
projects and had 24 units under contract. There can be no assurance that
condominium units under contract will close.
The Company recognized net gains in FFO of $8.5 million, or $0.16 per
diluted share, from condominium sales activities during the second
quarter of 2012, compared to $5.4 million, or $0.11 per diluted share,
during the second quarter of 2011.
2012 Outlook
The estimates and assumptions presented below are forward looking and
are based on the Company's future view of the apartment and condominium
markets and of general economic conditions, as well as other risks
outlined below under the caption "Forward-Looking Statements." There can
be no assurance that the Company's actual results will not differ
materially from the estimates set forth below. The Company assumes no
obligation to update this guidance in the future.
Based on its revised outlook, the Company anticipates that FFO for the
full year 2012 will be in the range set forth below, as compared to its
previous outlook issued in its May 2012 earnings release. The tables
below reflect anticipated net gains from condominium sales (for purposes
of this discussion, "Condo FFO") and FFO before Condo FFO (for purposes
of this discussion, "Core FFO").
Current Outlook
Previously Issued Outlook
Core FFO
$2.14 - $2.20
$2.07 - $2.14
Condo FFO
$0.36 - $0.40
$0.19 - $0.24
FFO
$2.50 - $2.60
$2.26 - $2.38
Same Store Assumptions
Current Outlook
Previously Issued Outlook
Revenue
6.25% - 6.75%
5.75% - 6.25%
Operating expenses
4.25% - 4.75%
3.75% - 4.75%
Net operating income (NOI)
7.20% - 8.20%
6.40% - 7.80%
Supplemental Financial Data
The Company also produces Supplemental Financial Data that includes
detailed information regarding the Company's operating results,
investment activity, financing activity, balance sheet and properties.
This Supplemental Financial Data is considered an integral part of this
earnings release and is available on the Company's website. The
Company's Earnings Release and the Supplemental Financial Data are
available through the For Investors/Financial Reports/Quarterly and
Other Reports section of the Company's website at www.postproperties.com.
The ability to access the attachments on the Company's website requires
the Adobe Acrobat Reader, which may be downloaded at http://get.adobe.com/reader/.
Non-GAAP Financial Measures and Other Defined Terms
The Company uses certain non-GAAP financial measures and other defined
terms in this press release and in its Supplemental Financial Data
available on the Company's website. The non-GAAP financial measures
include FFO, Adjusted Funds from Operations ("AFFO"), net operating
income, same store capital expenditures, and certain debt statistics and
ratios. The definitions of these non-GAAP financial measures are
summarized below and on page 19 of the Supplemental Financial Data. The
Company believes that these measures are helpful to investors in
measuring financial performance and/or liquidity and comparing such
performance and/or liquidity to other REITs.
Funds from Operations - The Company uses FFO as an operating
measure. The Company uses the NAREIT definition of FFO. FFO is defined
by NAREIT to mean net income (loss) available to common shareholders
determined in accordance with GAAP, excluding gains (or losses) from
extraordinary items and sales of depreciable operating property, plus
depreciation and amortization of real estate assets, and after
adjustment for unconsolidated partnerships and joint ventures all
determined on a consistent basis in accordance with GAAP. FFO presented
in the Company's press release and Supplemental Financial Data is not
necessarily comparable to FFO presented by other real estate companies
because not all real estate companies use the same definition. The
Company's FFO is comparable to the FFO of real estate companies that use
the current NAREIT definition.
Accounting for real estate assets using historical cost accounting under
GAAP assumes that the value of real estate assets diminishes predictably
over time. NAREIT stated in its April 2002 White Paper on Funds from
Operations that "since real estate asset values have historically risen
or fallen with market conditions, many industry investors have
considered presentations of operating results for real estate companies
that use historical cost accounting to be insufficient by themselves."
As a result, the concept of FFO was created by NAREIT for the REIT
industry to provide an alternate measure. Since the Company agrees with
the concept of FFO and appreciates the reasons surrounding its creation,
the Company believes that FFO is an important supplemental measure of
operating performance. In addition, since most equity REITs provide FFO
information to the investment community, the Company believes that FFO
is a useful supplemental measure for comparing the Company's results to
those of other equity REITs. The Company believes that the line on its
consolidated statement of operations entitled "net income available to
common shareholders" is the most directly comparable GAAP measure to FFO.
Adjusted Funds From Operations - The Company also uses adjusted
funds from operations ("AFFO") as an operating measure. AFFO is defined
as FFO less operating capital expenditures and after adjusting for the
impact of non-cash straight-line, long-term ground lease expense,
non-cash impairment charges, debt extinguishment gains (losses) and
preferred stock redemption costs. The Company believes that AFFO is an
important supplemental measure of operating performance for an equity
REIT because it provides investors with an indication of the REIT's
ability to fund its operating capital expenditures through earnings. In
addition, since most equity REITs provide AFFO information to the
investment community, the Company believes that AFFO is a useful
supplemental measure for comparing the Company to other equity REITs.
The Company believes that the line on its consolidated statement of
operations entitled "net income available to common shareholders" is the
most directly comparable GAAP measure to AFFO.
Property Net Operating Income ("NOI") - The Company uses property
NOI, including same store NOI and same store NOI by market, as an
operating measure. NOI is defined as rental and other revenues from real
estate operations less total property and maintenance expenses from real
estate operations (exclusive of depreciation and amortization). The
Company believes that NOI is an important supplemental measure of
operating performance for a REIT's operating real estate because it
provides a measure of the core operations, rather than factoring in
depreciation and amortization, financing costs and general and
administrative expenses generally incurred at the corporate level. This
measure is particularly useful, in the opinion of the Company, in
evaluating the performance of geographic operations, same store
groupings and individual properties. Additionally, the Company believes
that NOI, as defined, is a widely accepted measure of comparative
operating performance in the real estate investment community. The
Company believes that the line on its consolidated statement of
operations entitled "net income" is the most directly comparable GAAP
measure to NOI.
Same Store Capital Expenditures - The Company uses same store
annually recurring and periodically recurring capital expenditures as
cash flow measures. Same store annually recurring and periodically
recurring capital expenditures are supplemental non-GAAP financial
measures. The Company believes that same store annually recurring and
periodically recurring capital expenditures are important indicators of
the costs incurred by the Company in maintaining its same store
communities on an ongoing basis. The corresponding GAAP measures include
information with respect to the Company's other operating segments
consisting of communities stabilized in the prior year, lease-up
communities, rehabilitation properties, sold properties and commercial
properties in addition to same store information. Therefore, the Company
believes that the Company's presentation of same store annually
recurring and periodically recurring capital expenditures is necessary
to demonstrate same store replacement costs over time. The Company
believes that the most directly comparable GAAP measure to same store
annually recurring and periodically recurring capital expenditures is
the line on the Company's consolidated statements of cash flows entitled
"property capital expenditures," which also includes revenue generating
capital expenditures.
Debt Statistics and Debt Ratios - The Company uses a number of
debt statistics and ratios as supplemental measures of liquidity. The
numerator and/or the denominator of certain of these statistics and/or
ratios include non-GAAP financial measures that have been reconciled to
the most directly comparable GAAP financial measure. These debt
statistics and ratios include: (1) interest coverage ratios; (2) fixed
charge coverage ratios; (3) total debt as a percentage of undepreciated
real estate assets (adjusted for joint venture partner's share of debt);
(4) total debt plus preferred equity as a percentage of undepreciated
real estate assets (adjusted for joint venture partner's share of debt);
(5) a ratio of consolidated debt to total assets; (6) a ratio of secured
debt to total assets; (7) a ratio of total unencumbered assets to
unsecured debt; (8) a ratio of consolidated income available for debt
service to annual debt service charge; and (9) a debt to annualized
income available for debt service ratio. A number of these debt
statistics and ratios are derived from covenants found in the Company's
debt agreements, including, among others, the Company's senior unsecured
notes. In addition, the Company presents these measures because the
degree of leverage could affect the Company's ability to obtain
additional financing for working capital, capital expenditures,
acquisitions, development or other general corporate purposes. The
Company uses these measures internally as an indicator of liquidity, and
the Company believes that these measures are also utilized by the
investment and analyst communities to better understand the Company's
liquidity.
The Company uses income available for debt service to calculate certain
debt ratios and statistics. Income available for debt service is defined
as net income (loss) before interest, taxes, depreciation, amortization,
gains on sales of real estate assets, non-cash impairment charges and
other non-cash income and expenses. Income available for debt service is
a supplemental measure of operating performance that does not represent
and should not be considered as an alternative to net income or cash
flow from operating activities as determined under GAAP, and the
Company's calculation thereof may not be comparable to similar measures
reported by other companies, including EBITDA or Adjusted EBITDA.
Property Operating Statistics - The Company uses average economic
occupancy, gross turnover, net turnover and percentage increases in rent
for new and renewed leases as statistical measures of property operating
performance. The Company defines average economic occupancy as gross
potential rent less vacancy losses, model expenses and bad debt expenses
divided by gross potential rent for the period, expressed as a
percentage. Gross turnover is defined as the percentage of leases
expiring during the period that are not renewed by the existing
residents. Net turnover is defined as gross turnover decreased by the
percentage of expiring leases where the residents transfer to a new
apartment unit in the same community or in another Post® community. The
percentage increases in rent for new and renewed leases are calculated
using the respective new or renewed rental rate as of the date of a new
lease, as compared with the previous rental rate on that same unit.
Conference Call Information
The Company will hold its quarterly conference call on Tuesday, July 31,
at 10:00 a.m. ET. The telephone numbers are 888-337-8259 for US and
Canada callers and 719-325-2146 for international callers. The access
code is 3916841. The conference call will be open to the public and can
be listened to live on Post's website at www.postproperties.com
under For Investors/Event Calendar. The replay will begin at 1:00 p.m.
ET on Tuesday, July 31, and will be available until Monday, August 6, at
11:59 p.m. ET. The telephone numbers for the replay are 888-203-1112 for
US and Canada callers and 719-457-0820 for international callers. The
access code for the replay is 3916841. A replay of the call also will be
archived on Post's website under For Investors/Audio Archives.
About Post
Post Properties, founded more than 40 years ago, is a leading developer
and operator of upscale multifamily communities. The Company's mission
is delivering superior satisfaction and value to its residents,
associates, and investors, with a vision of being the first choice in
quality multifamily living. Operating as a real estate investment trust
("REIT"), the Company focuses on developing and managing Post® branded
resort-style garden and high density urban apartments. Post Properties
is headquartered in Atlanta, Georgia, and has operations in ten markets
across the country.
Post Properties has interests in 21,982 apartment units in 59
communities, including 1,471 apartment units in four communities held in
unconsolidated entities and 1,810 apartment units in six communities
currently under development or in lease-up. The Company is also selling
luxury for-sale condominium homes in two communities through a taxable
REIT subsidiary.
Forward-Looking Statements
Certain statements made in this press release and other written or oral
statements made by or on behalf of the Company, may constitute
"forward-looking statements" within the meaning of the federal
securities laws. Statements regarding future events and developments and
the Company's future performance, as well as management's expectations,
beliefs, plans, estimates or projections relating to the future, are
forward-looking statements within the meaning of these laws. Examples of
such statements in this press release include, expectations regarding
apartment market conditions, expectations regarding use of proceeds from
unsecured bank credit facilities, expectations regarding future
operating conditions, including the Company's current outlook as to
expected funds from operations, revenue, operating expenses and net
operating income, anticipated development activities (including
projected construction expenditures and timing), expectations regarding
the for-sale condominium business, and expectations regarding offerings
of the Company's common stock and the use of proceeds thereof. All
forward-looking statements are subject to certain risks and
uncertainties that could cause actual events to differ materially from
those projected. Management believes that these forward-looking
statements are reasonable; however, you should not place undue reliance
on such statements. These statements are based on current expectations
and speak only as of the date of such statements. The Company undertakes
no obligation to publicly update or revise any forward-looking
statement, whether as a result of future events, new information or
otherwise.
The following are some of the factors that could cause the Company's
actual results and its expectations to differ materially from those
described in the Company's forward-looking statements: the success of
the Company's business strategies discussed in its Annual Report on Form
10-K for the year ended December 31, 2011 and in subsequent filings with
the SEC; conditions affecting ownership of residential real estate and
general conditions in the multi-family residential real estate market;
uncertainties associated with the Company's real estate development and
construction; uncertainties associated with the timing and amount of
apartment community sales; exposure to economic and other competitive
factors due to market concentration; future local and national economic
conditions, including changes in job growth, interest rates, the
availability of mortgage and other financing and related factors; the
Company's ability to generate sufficient cash flows to make required
payments associated with its debt financing; the effects of the
Company's leverage on its risk of default and debt service requirements;
the impact of a downgrade in the credit rating of the Company's
securities; the effects of a default by the Company or its subsidiaries
on an obligation to repay outstanding indebtedness, including
cross-defaults and cross-acceleration under other indebtedness; the
effects of covenants of the Company's or its subsidiaries' mortgage
indebtedness on operational flexibility and default risks; the effects
of any decision by the government to eliminate Fannie Mae or Freddie Mac
or reduce government support for apartment mortgage loans; the Company's
ability to maintain its current dividend level; uncertainties associated
with the Company's condominium for-sale housing business, including the
timing and volume of condominium sales; the impact of any additional
charges the Company may be required to record in the future related to
any impairment in the carrying value of its assets; the impact of
competition on the Company's business, including competition for
residents in the Company's apartment communities and buyers of the
Company's for-sale condominium homes and development locations; the
Company's ability to compete for limited investment opportunities; the
effects of changing interest rates and effectiveness of interest rate
hedging contracts; the success of the Company's acquired apartment
communities; the Company's ability to succeed in new markets; the costs
associated with compliance with laws requiring access to the Company's
properties by persons with disabilities; the impact of the Company's
ongoing litigation with the U.S. Department of Justice regarding the
Americans with Disabilities Act and the Fair Housing Act as well as the
impact of other litigation; the effects of losses from natural
catastrophes in excess of insurance coverage; uncertainties associated
with environmental and other regulatory matters; the costs associated
with moisture infiltration and resulting mold remediation; the Company's
ability to control joint ventures, properties in which it has joint
ownership and corporations and limited partnership in which it has
partial interests; the Company's ability to renew leases or relet units
as leases expire; the Company's ability to continue to qualify as a REIT
under the Internal Revenue Code; and the effects of changes in
accounting policies and other regulatory matters detailed in the
Company's filings with the Securities and Exchange Commission; increased
costs arising from health care reform; any breach of the Company's
privacy or information security systems. Other important risk factors
regarding the Company are included under the caption "Risk Factors" in
the Company's Annual Report on Form 10-K for the year ended December 31,
2011 and may be discussed in subsequent filings with the SEC. The risk
factors discussed in Form 10-K under the caption "Risk Factors" are
specifically incorporated by reference into this press release.
Financial Highlights
(Unaudited; in thousands, except per share and unit amounts)
Three months ended
Six months ended
June 30,
June 30,
2012
2011
2012
2011
OPERATING DATA
Total revenues
$ 82,160
$ 75,424
$ 162,436
$ 148,955
Net income available to common shareholders
$ 20,157
$ 8,824
$ 41,035
$ 8,403
Funds from operations available to common
shareholders and unitholders (Table 1)
$ 39,654
$ 27,677
$ 73,877
$ 46,018
Weighted average shares outstanding - diluted
54,096
50,266
53,799
49,854
Weighted average shares and units outstanding - diluted
54,246
50,435
53,950
50,024
PER COMMON SHARE DATA - DILUTED
Net income available to common shareholders
$ 0.37
$ 0.17
$ 0.76
$ 0.17
Funds from operations available to common
shareholders and unitholders (Table 1) (1)
$ 0.73
$ 0.55
$ 1.37
$ 0.92
Dividends declared
$ 0.25
$ 0.20
$ 0.47
$ 0.40
1) Funds from operations per share was computed using weighted
average shares and units outstanding, including the impact of
dilutive securities totaling 323 and 391 for the three months and
369 and 394 for the six months ended June 30, 2012 and 2011,
respectively. Additionally, diluted weighted average shares and
units included the impact of non-vested shares and units totaling
130 and 169 for the three months and 124 and 161 for the six
months ended June 30, 2012 and 2011, respectively, for the
computation of FFO per share. Such non-vested shares and units are
considered in the income per share computations under GAAP using
the "two-class method."
Table 1
Reconciliation of Net Income Available to Common Shareholders to
Funds From Operations Available to Common Shareholders and
Unitholders
(Unaudited; in thousands, except per share amounts)
Three months ended
Six months ended
June 30,
June 30,
2012
2011
2012
2011
Net income available to common shareholders
$
20,157
$
8,824
$
41,035
$
8,403
Noncontrolling interests - Operating Partnership
56
30
115
29
Depreciation on consolidated real estate assets, net
19,156
18,461
38,159
36,864
Depreciation on real estate assets held in
unconsolidated entities
285
362
623
722
Gains on sales of depreciable real estate assets -
unconsolidated entities
-
-
(6,055
)
-
Funds from operations available to common
shareholders and unitholders
$
39,654
$
27,677
$
73,877
$
46,018
Funds from operations - per share and unit - diluted (1)
$
0.73
$
0.55
$
1.37
$
0.92
Weighted average shares and units outstanding - diluted (1)
54,376
50,604
54,074
50,185
1) Diluted weighted average shares and units include the impact of
dilutive securities totaling 323 and 391 for the three months and
369 and 394 for the six months ended June 30, 2012 and 2011,
respectively. Additionally, diluted weighted average shares and
units included the impact of non-vested shares and units totaling
130 and 169 for the three months and 124 and 161 for the six
months ended June 30, 2012 and 2011, respectively, for the
computation of FFO per share. Such non-vested shares and units are
considered in the income per share computations under GAAP using
the "two-class method."
Table 2
Reconciliation of Same Store Net Operating Income (NOI) to GAAP
Net Income
(Unaudited; In thousands)
Three months ended
Six months ended
June 30,
June 30,
March 31,
June 30,
June 30,
2012
2011
2012
2012
2011
Total same store NOI
$
46,202
$
41,850
$
45,066
$
91,268
$
82,476
Property NOI from other operating segments
521
141
351
872
213
Consolidated property NOI
46,723
41,991
45,417
92,140
82,689
Add (subtract):
Interest income
288
516
51
339
608
Other revenues
206
227
222
428
443
Depreciation
(19,497
)
(18,808
)
(19,341
)
(38,838
)
(37,560
)
Interest expense
(11,103
)
(14,437
)
(11,645
)
(22,748
)
(28,912
)
Amortization of deferred financing costs
(698
)
(721
)
(661
)
(1,359
)
(1,368
)
General and administrative
(3,883
)
(4,246
)
(4,285
)
(8,168
)
(8,362
)
Investment and development
(322
)
(296
)
(480
)
(802
)
(774
)
Other investment costs
(306
)
(455
)
(306
)
(612
)
(949
)
Gains on condominium sales activities, net
8,530
5,432
6,904
15,434
6,176
Equity in income of unconsolidated
real estate entities, net
495
346
6,446
6,941
555
Other income (expense), net
737
285
(156
)
581
301
Net loss on extinguishment of indebtedness
-
-
(301
)
(301
)
-
Net income
$
21,170
$
9,834
$
21,865
$
43,035
$
12,847
Table 3
Same Store Net Operating Income (NOI) and Average Rental Rate per
Unit by Market
(In thousands)
Three months ended
Q2 '12
Q2 '12
Q2 '12
June 30,
June 30,
March 31,
vs. Q2 '11
vs. Q1 '12
% Same
2012
2011
2012
% Change
% Change
Store NOI
Rental and other revenues
Atlanta
$
20,320
$
18,927
$
19,970
7.4
%
1.8
%
Washington, D.C.
13,108
12,377
12,854
5.9
%
2.0
%
Dallas
15,720
14,420
15,123
9.0
%
3.9
%
Tampa
8,628
8,052
8,509
7.2
%
1.4
%
Charlotte
4,845
4,440
4,663
9.1
%
3.9
%
New York
3,668
3,520
3,602
4.2
%
1.8
%
Houston
3,359
3,018
3,245
11.3
%
3.5
%
Orlando
2,711
2,511
2,662
8.0
%
1.8
%
Austin
2,770
2,438
2,692
13.6
%
2.9
%
Total rental and other revenues
75,129
69,703
73,320
7.8
%
2.5
%
Property operating and maintenance
expenses (exclusive of depreciation
and amortization)
Atlanta
8,087
7,896
7,816
2.4
%
3.5
%
Washington, D.C.
3,946
3,927
4,024
0.5
%
(1.9
)%
Dallas
6,655
6,369
6,527
4.5
%
2.0
%
Tampa
3,257
3,096
3,170
5.2
%
2.7
%
Charlotte
1,742
1,739
1,620
0.2
%
7.5
%
New York
1,607
1,521
1,686
5.7
%
(4.7
)%
Houston
1,439
1,251
1,205
15.0
%
19.4
%
Orlando
1,001
1,002
1,003
(0.1
)%
(0.2
)%
Austin
1,193
1,052
1,203
13.4
%
(0.8
)%
Total
28,927
27,853
28,254
3.9
%
2.4
%
Net operating income
Atlanta
12,233
11,031
12,154
10.9
%
0.6
%
26.5
%
Washington, D.C.
9,162
8,450
8,830
8.4
%
3.8
%
19.8
%
Dallas
9,065
8,051
8,596
12.6
%
5.5
%
19.6
%
Tampa
5,371
4,956
5,339
8.4
%
0.6
%
11.6
%
Charlotte
3,103
2,701
3,043
14.9
%
2.0
%
6.7
%
New York
2,061
1,999
1,916
3.1
%
7.6
%
4.5
%
Houston
1,920
1,767
2,040
8.7
%
(5.9
)%
4.2
%
Orlando
1,710
1,509
1,659
13.3
%
3.1
%
3.7
%
Austin
1,577
1,386
1,489
13.8
%
5.9
%
3.4
%
Total same store NOI
$
46,202
$
41,850
$
45,066
10.4
%
2.5
%
100.0
%
Average rental rate per unit
Atlanta
$
1,187
$
1,108
$
1,168
7.1
%
1.6
%
Washington, D.C.
1,859
1,804
1,843
3.0
%
0.9
%
Dallas
1,121
1,042
1,101
7.6
%
1.8
%
Tampa
1,321
1,227
1,297
7.7
%
1.8
%
Charlotte
1,129
1,039
1,105
8.7
%
2.2
%
New York
3,777
3,685
3,744
2.5
%
0.9
%
Houston
1,292
1,190
1,264
8.6
%
2.2
%
Orlando
1,447
1,355
1,424
6.8
%
1.6
%
Austin
1,572
1,449
1,548
8.5
%
1.6
%
Total average rental rate per unit
1,341
1,259
1,320
6.5
%
1.6
%
Table 3 (con't)
Same Store Net Operating Income (NOI) and Average Rental Rate per
Unit by Market
(In thousands)
Six months ended
June 30,
June 30,
2012
2011
% Change
Rental and other revenues
Atlanta
$
40,291
$
37,440
7.6
%
Washington, D.C.
25,962
24,426
6.3
%
Dallas
30,842
28,467
8.3
%
Tampa
17,137
15,973
7.3
%
Charlotte
9,508
8,707
9.2
%
New York
7,270
6,933
4.9
%
Houston
6,604
5,982
10.4
%
Orlando
5,373
4,991
7.7
%
Austin
5,462
4,802
13.7
%
Total rental and other revenues
148,449
137,721
7.8
%
Property operating and maintenance
expenses (exclusive of depreciation
and amortization)
Atlanta
15,903
15,718
1.2
%
Washington, D.C.
7,969
7,696
3.5
%
Dallas
13,182
12,693
3.9
%
Tampa
6,428
6,050
6.2
%
Charlotte
3,363
3,338
0.7
%
New York
3,293
3,071
7.2
%
Houston
2,644
2,588
2.2
%
Orlando
2,004
1,984
1.0
%
Austin
2,395
2,107
13.7
%
Total
57,181
55,245
3.5
%
Net operating income
Atlanta
24,388
21,722
12.3
%
Washington, D.C.
17,993
16,730
7.5
%
Dallas
17,660
15,774
12.0
%
Tampa
10,709
9,923
7.9
%
Charlotte
6,145
5,369
14.5
%
New York
3,977
3,862
3.0
%
Houston
3,960
3,394
16.7
%
Orlando
3,369
3,007
12.0
%
Austin
3,067
2,695
13.8
%
Total same store NOI
$
91,268
$
82,476
10.7
%
Average rental rate per unit
Atlanta
$
1,177
$
1,100
7.0
%
Washington, D.C.
1,851
1,795
3.1
%
Dallas
1,111
1,037
7.1
%
Tampa
1,309
1,216
7.6
%
Charlotte
1,117
1,029
8.6
%
New York
3,760
3,679
2.2
%
Houston
1,278
1,182
8.1
%
Orlando
1,436
1,346
6.7
%
Austin
1,560
1,437
8.6
%
Total average rental rate per unit
1,330
1,251
6.3
%
Table 4
Computation of Debt Ratios
(In thousands)
As of June 30,
2012
2011
Total real estate assets per balance sheet
$
2,099,355
$
2,025,740
Plus:
Company share of real estate assets held in unconsolidated entities
59,450
70,828
Company share of accumulated depreciation - assets held in
unconsolidated entities
10,284
11,611
Accumulated depreciation per balance sheet
805,129
729,759
Total undepreciated real estate assets (A)
$
2,974,218
$
2,837,938
Total debt per balance sheet
$
967,582
$
1,031,878
Plus:
Company share of third party debt held in unconsolidated entities
49,531
59,601
Total debt (adjusted for joint venture partners' share of debt) (B)
$
1,017,113
$
1,091,479
Total debt as a % of undepreciated real estate assets (adjusted for
joint venture
partners' share of debt) (B÷A)
34.2
%
38.5
%
Total debt per balance sheet
$
967,582
$
1,031,878
Plus:
Company share of third party debt held in unconsolidated entities
49,531
59,601
Preferred shares at liquidation value
43,392
43,392
Total debt and preferred equity (adjusted for joint venture partners'
share of debt) (C)
$
1,060,505
$
1,134,871
Total debt and preferred equity as a % of undepreciated real estate
assets (adjusted
Recommend:
