Franklin Street Properties Corp. (the “Company”, “FSP”, “we” or
“our”) (NYSE MKT: FSP), a real estate investment trust (REIT),
announced today Funds From Operations (FFO) of $26.0 million or
$0.26 per share for the first quarter ended March 31, 2016. Net
income was $2.6 million or $0.03 per share for the first quarter
ended March 31, 2016.
The Company evaluates its performance based on FFO, Adjusted
Funds From Operations (AFFO), Net Income and Earnings Per Share
(EPS) and believes each is an important measure. A reconciliation
of Net Income to FFO and AFFO, which are non-GAAP financial
measures, is provided on page 3 of this press release.
(in 000's except per
share data) Three Months Ended March 31, Increase 2016 2015
(Decrease) Net Income $ 2,579 $ 12,533 $ (9,954 ) FFO
$ 26,037 $ 25,672 $ 365 Per Share Data: EPS $ 0.03 $ 0.13 $
(0.10 ) FFO $ 0.26 $ 0.26 $ — AFFO $ 0.21 $ 0.21 $ —
Weighted average shares (diluted) 100,187 100,187 —
Comparing results for the first quarter of 2016 to the same
period in 2015, FFO increased $0.4 million to $26.0 million and was
$0.26 per share for the first quarter of 2016 and the first quarter
of 2015. The FFO increase was primarily from higher property income
as a result of leasing and the acquisition of a property on April
8, 2015, which was partially offset by the impact of asset sales
and loan repayments that occurred in the last twelve months. Net
Income and EPS were $2.6 million and $0.03 per share for the first
quarter of 2016, respectively, compared to Net Income of $12.5
million and EPS of $0.13 for the first quarter of 2015. Included in
Net Income for the first quarter of 2015, were gains on sales of
properties of $10.5 million or $0.10 per share. We did not sell any
properties in the first quarter of 2016.
George J. Carter, President and CEO, commented as
follows:
“For the first quarter of 2016, FSP’s funds from operations, or
FFO, totaled approximately $26.0 million or $0.26 per share. These
results are within our guidance range for the first quarter of
2016. Dividend distributions paid/declared for first quarter 2016
totaled approximately $19.0 million or $0.19 per share. Our initial
FFO guidance for full year 2016 is being maintained and is
estimated to be in the range of $1.01 to $1.07 per diluted share,
while for the second quarter of 2016, we estimate FFO to be in the
range of $0.24 to $0.26 per diluted share.
Our directly owned real estate portfolio of 35 properties
totaling approximately 9.3 million square feet was approximately
90.2% leased as of March 31, 2016. We continued active leasing in
the first quarter, much of it renewals ahead of future lease
expirations. We anticipate continued significant leasing activity
within the portfolio during 2016.
Subsequent to the end of the first quarter, on April 5, 2016, we
sold our Maryland Heights, Missouri property, known as Lakeside
Crossing I for $20.2 million. FSP will record a gain on sale for
this property disposition of approximately $4.1 million in the
second quarter of 2016. Property acquisition efforts are currently
very active and are focused on CBD and urban infill office
buildings located within our five core markets. We anticipate
making one or more property acquisitions during 2016. Regarding our
redevelopment efforts at 801 Marquette Avenue in downtown
Minneapolis, Minnesota, after extensive costing analysis with our
potential development partners and outside professionals, we have
decided to redevelop the existing building ourselves, rather than
raze it and build a new, mixed use tower with outside development
partners. As previously announced, Ryan Companies US, Inc. will be
the development manager and design/builder, Perkins+Will will lead
the architectural design work and CBRE Group, Inc. will be the
exclusive leasing agent. We are fully engaged with our outside
professionals on this exciting redevelopment and will continue to
provide updates as they become available.
As we continue 2016, our property portfolio is operating
smoothly with existing and known upcoming vacancies actively being
marketed to multiple potential tenants. We look forward with
anticipation to 2016 and beyond.”
Dividend Update
On April 8, 2016, the Company announced that its Board of
Directors declared a regular quarterly dividend for the three
months ended March 31, 2016 of $0.19 per share of common stock that
will be paid on May 12, 2016 to stockholders of record on April 22,
2016.
FFO Guidance
We are maintaining our full year FFO guidance for 2016 to be in
the range of $1.01 to $1.07 per diluted share and, for the second
quarter of 2016, we estimate FFO to be in the range of $0.24 to
$0.26 per diluted share. This guidance (a) excludes the impact of
future acquisitions, developments, dispositions, debt financings or
repayments or other capital market transactions; (b) reflects
estimates from our ongoing portfolio of properties, other real
estate investments and G&A expenses; and (c) reflects our
current expectations of economic conditions. We will update
guidance quarterly in our earnings releases. There can be no
assurance that the Company’s actual results will not differ
materially from the estimates set forth above.
Real Estate Update
Supplementary schedules provide property information for the
Company’s owned real estate portfolio and for two non-consolidated
REITs in which the Company holds preferred stock interests as of
March 31, 2016. The Company will also be filing an updated
supplemental information package that will provide stockholders and
the financial community with additional operating and financial
data. The Company will file this supplemental information package
with the SEC and make it available on its website at
www.franklinstreetproperties.com.
Funds From Operations (FFO) and Adjusted Funds From
Operations (AFFO)
A reconciliation of Net Income to FFO and AFFO is shown below
and a definition of FFO and AFFO is provided on Supplementary
Schedule H. Management believes FFO and AFFO are used broadly
throughout the real estate investment trust (REIT) industry as
measurements of performance. Management also believes that FFO and
AFFO represent the most accurate measures of activity and are the
basis for distributions paid to equity holders. The Company has
included the NAREIT FFO definition in the table and notes that
other REITs may not define FFO in accordance with the current
NAREIT definition or may interpret the current NAREIT definition
differently. The Company’s computation of FFO and AFFO may not be
comparable to FFO or AFFO reported by other REITs or real estate
companies that define FFO or AFFO differently.
Reconciliation of Net Income to FFO and
AFFO: Three Months Ended March 31, (In thousands, except per share
amounts) 2016 2015 Net income $ 2,579 $ 12,533 Gain on sale
of assets, less applicable income tax — (10,462 ) GAAP loss from
non-consolidated REITs 286 322 FFO from non-consolidated REITs 645
601 Depreciation & amortization 22,527
22,678 NAREIT FFO 26,037 25,672 Acquisition costs of new
properties — — Funds From Operations
(FFO) $ 26,037 $ 25,672 Funds From Operations
(FFO) $ 26,037 $ 25,672 Reverse FFO from non-consolidated REITs
(645 ) (601 ) Distributions from non-consolidated REITs 27 27
Amortization of deferred financing costs 517 517 Straight-line rent
(1,275 ) (69 ) Tenant improvements (1,929 ) (2,936 ) Leasing
commissions (1,613 ) (830 ) Non-investment capex (438 )
(643 ) Adjusted Funds From Operations (AFFO) $ 20,681
$ 21,137 Per Share Data EPS $ 0.03 $ 0.13 FFO $ 0.26
$ 0.26 AFFO $ 0.21 $ 0.21 Weighted average shares (basic and
diluted) 100,187 100,187
Today’s news release, along with other news about Franklin
Street Properties Corp., is available on the Internet at
www.franklinstreetproperties.com. We routinely post information
that may be important to investors in the Investor Relations
section of our website. We encourage investors to consult that
section of our website regularly for important information about us
and, if they are interested in automatically receiving news and
information as soon as it is posted, to sign up for E-mail
Alerts.
Earnings Call
A conference call is scheduled for April 27, 2016 at 10:00 a.m.
(ET) to discuss the first quarter 2016 results. To access the call,
please dial 1-877-507-4376. Internationally, the call may be
accessed by dialing 1-412-317-6014. To listen via live audio
webcast, please visit the Webcasts & Presentations section in
the Investor Relations section of the Company's website
(www.franklinstreetproperties.com) at least ten minutes prior to
the start of the call and follow the posted directions. The webcast
will also be available via replay from the above location starting
one hour after the call is finished.
About Franklin Street Properties Corp.
Franklin Street Properties Corp., based in Wakefield,
Massachusetts, is focused on investing in institutional-quality
office properties in the U.S. FSP’s strategy is to invest in select
urban infill and central business district (CBD) properties, with
primary emphasis on our top five markets of Atlanta, Dallas,
Denver, Houston, and Minneapolis. FSP seeks value-oriented
investments with an eye towards long-term growth and appreciation,
as well as current income. FSP is a Maryland corporation that
operates in a manner intended to qualify as a real estate
investment trust (REIT) for federal income tax purposes. To learn
more about FSP please visit our website at
www.franklinstreetproperties.com.
Forward-Looking Statements
Statements made in this press release that state FSP’s or
management’s intentions, beliefs, expectations, or predictions for
the future may be forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. This press
release may also contain forward-looking statements based on
current judgments and current knowledge of management, which are
subject to certain risks, trends and uncertainties that could cause
actual results to differ materially from those indicated in such
forward-looking statements. Accordingly, readers are cautioned not
to place undue reliance on forward-looking statements. Investors
are cautioned that our forward-looking statements involve risks and
uncertainty, including without limitation, economic conditions in
the United States, disruptions in the debt markets, economic
conditions in the markets in which we own properties, risks of a
lessening of demand for the types of real estate owned by us,
changes in government regulations and regulatory uncertainty,
uncertainty about governmental fiscal policy, geopolitical events
and expenditures that cannot be anticipated such as utility rate
and usage increases, unanticipated repairs, additional staffing,
insurance increases and real estate tax valuation reassessments.
See the “Risk Factors” set forth in Part I, Item 1A of our Annual
Report on Form 10-K for the year ended December 31, 2015, as the
same may be updated from time to time in subsequent filings with
the United States Securities and Exchange Commission. Although we
believe the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements. We will not update
any of the forward-looking statements after the date of this press
release to conform them to actual results or to changes in our
expectations that occur after such date, other than as required by
law.
Franklin Street Properties
Corp.Earnings ReleaseSupplementary
InformationTable of Contents
Franklin Street Properties Corp.
Financial Results A-C Real Estate Portfolio Summary Information D
Portfolio and Other Supplementary Information E Percentage of
Leased Space F Largest 20 Tenants – FSP Owned Portfolio G
Definition of Funds From Operations (FFO) H
Franklin Street Properties Corp. Financial
ResultsSupplementary Schedule ACondensed Consolidated Income (Loss)
Statements(Unaudited)
For the
Three Months Ended
March 31, (in thousands, except per
share amounts)
2016 2015
Revenue: Rental $ 58,360 $ 59,013 Related party revenue:
Management fees and interest income from loans 1,433 1,473 Other
20 21 Total
revenue 59,813
60,507 Expenses: Real estate operating expenses
15,292 15,356 Real estate taxes and insurance 9,150 10,048
Depreciation and amortization 22,445 22,672 Selling, general and
administrative 3,530 3,691 Interest 6,433
6,187 Total expenses
56,850 57,954
Income before interest income, equity in losses of
non-consolidated REITs and taxes 2,963 2,553 Interest income — 1
Equity in losses of non-consolidated REITs (286 ) (322 ) Gain on
sale of properties, less applicable income tax
— 10,462 Income before
taxes on income 2,677 12,694 Taxes on income
98 161 Net income
$ 2,579 $ 12,533 Weighted
average number of shares outstanding, basic and diluted
100,187 100,187
Net income per share, basic and diluted $ 0.03
$ 0.13
Franklin Street Properties Corp. Financial
ResultsSupplementary Schedule BCondensed Consolidated Balance
Sheets(Unaudited)
March 31, December 31,
(in thousands, except share and par value amounts)
2016 2015 Assets: Real estate assets:
Land $ 168,120 $ 170,021 Buildings and improvements 1,625,819
1,637,066 Fixtures and equipment 2,649
2,528 1,796,588 1,809,615 Less
accumulated depreciation 309,307
299,991 Real estate assets, net 1,487,281
1,509,624 Acquired real estate leases, less accumulated
amortization of $117,134 and $112,844, respectively 99,102 108,046
Investment in non-consolidated REITs 76,707 77,019 Asset held for
sale 15,921 — Cash and cash equivalents 14,316 18,163 Restricted
cash 10 23 Tenant rent receivables, less allowance for doubtful
accounts of $130 and $130, respectively 3,691 2,898 Straight-line
rent receivable, less allowance for doubtful accounts of $50 and
$50, respectively 49,696 48,502 Prepaid expenses and other assets
5,943 5,484 Related party mortgage loan receivables 79,575 118,641
Other assets: derivative asset — 1,132 Office computers and
furniture, net of accumulated depreciation of $1,372 and $1,333,
respectively 438 484 Deferred leasing commissions, net of
accumulated amortization of $21,035 and $20,002, respectively
28,705 28,999
Total assets $ 1,861,385
$ 1,919,015 Liabilities and Stockholders’ Equity:
Liabilities: Bank note payable $ 265,000 $ 290,000 Term loans
payable, less unamortized financing costs of $2,120 and $2,353,
respectively 617,880 617,647 Accounts payable and accrued expenses
37,791 49,489 Accrued compensation 1,274 3,726 Tenant security
deposits 4,433 4,829 Other liabilities: derivative liability 13,226
8,243 Acquired unfavorable real estate leases, less accumulated
amortization of $9,822 and $9,368, respectively
8,697 9,425 Total
liabilities 948,301
983,359 Commitments and contingencies
Stockholders’ Equity: Preferred stock, $.0001 par value, 20,000,000
shares authorized, none issued or outstanding - - Common stock,
$.0001 par value, 180,000,000 shares authorized, 100,187,405 and
100,187,405 shares issued and outstanding, respectively 10 10
Additional paid-in capital 1,273,556 1,273,556 Accumulated other
comprehensive loss (13,226 ) (7,111 ) Accumulated distributions in
excess of accumulated earnings (347,256 )
(330,799 ) Total stockholders’ equity
913,084 935,656
Total liabilities and stockholders’ equity $
1,861,385 $ 1,919,015
Franklin Street Properties Corp. Financial
ResultsSupplementary Schedule CCondensed Consolidated Statements of
Cash Flows
(Unaudited)
For the Three Months
Ended March 31, (in thousands)
2016
2015 Cash flows from operating
activities: Net income $ 2,579 $ 12,533 Adjustments to
reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense 22,962 23,189 Amortization of
above market lease 81 6 Equity in losses of non-consolidated REITs
286 322 Gain on sale of properties, less applicable income tax —
(10,462 ) Changes in operating assets and liabilities: Restricted
cash 13 686 Tenant rent receivables (793 ) 146 Straight-line rents
(1,275 ) (69 ) Lease acquisition costs (199 ) (3 ) Prepaid expenses
and other assets (791 ) 283 Accounts payable, accrued expenses and
other items (10,374 ) (7,706 ) Accrued compensation (2,452 ) (2,517
) Tenant security deposits (396 ) (230 ) Payment of deferred
leasing commissions (1,825 )
(1,116 ) Net cash provided by operating activities
7,816 15,062
Cash flows from investing activities: Property improvements,
fixtures and equipment (6,699 ) (4,298 ) Office computers and
furniture (21 ) — Distributions in excess of earnings from
non-consolidated REITs 27 27 Repayment of related party mortgage
loan receivable 39,066 — Proceeds received on sales of real estate
assets — 47,671 Changes in deposits on real estate assets
— (4,000 ) Net cash
provided by investing activities 32,373
39,400
Cash flows from financing
activities: Distributions to stockholders (19,036 ) (19,036 )
Borrowings under bank note payable 15,000 20,000 Repayments of bank
note payable (40,000 )
(48,000 ) Net cash used in financing activities
(44,036 ) (47,036 )
Net increase
(decrease) in cash and cash equivalents (3,847 ) 7,426
Cash
and cash equivalents, beginning of year
18,163 7,519
Cash and cash
equivalents, end of period $ 14,316
$ 14,945
Franklin Street Properties Corp. Earnings
ReleaseSupplementary Schedule DReal Estate Portfolio Summary
Information(Unaudited & Approximated)
Commercial portfolio lease
expirations (1) Total % of
Year
Square Feet
Portfolio 2016 587,494 6.3% 2017 1,012,296 10.9% 2018 1,113,118
11.9% 2019 1,314,261 14.1% 2020 851,253 9.1% Thereafter (2)
4,446,827 47.7% 9,325,249 100.0%
(1) Percentages are determined based upon total square
footage.
(2) Includes 917,040 square feet of current vacancies.
(dollars & square feet in 000's) As of March 31, 2016 #
of % of Square % of State Properties Investment Portfolio Feet
Portfolio Texas 9 $ 363,725 24.2% 2,418 25.9% Colorado 5
428,338 28.5% 2,010 21.6% Georgia 4 286,124 19.1% 1,838 19.7%
Virginia 4 92,516 6.2% 685 7.3% Minnesota (a) 1 26,544 1.8% 306
3.3% Missouri (b) 3 61,734 4.1% 478 5.1% North Carolina 2 54,805
3.7% 322 3.5% Illinois 2 44,002 2.9% 372 4.0% Maryland 1 50,797
3.4% 325 3.4% Florida 1 41,545 2.8% 213 2.3% Indiana 1 31,342 2.1%
205 2.2% California 1 3,794 0.3% 36 0.4% Washington 1
13,667 0.9% 117 1.3% Total 35
$ 1,498,933 100.0% 9,325
100.0%
(a) Excludes approximately $4,269, which is
our investment in a property being redeveloped.
(b) Includes asset held for sale of $15,921,
which was sold on April 5, 2016.
Franklin Street Properties Corp. Earnings
ReleaseSupplementary Schedule EPortfolio and Other Supplementary
Information(Unaudited & Approximated)
Recurring Capital
ExpendituresOwned Portfolio
For the Three Months Ended Year ended
31-Mar-16 31-Mar-15 30-Jun-15 30-Sep-15 31-Dec-15 31-Dec-15
Tenant improvements $ 1,929 $ 2,936 $ 3,420 $ 1,794 $ 3,788 $
11,938 Deferred leasing costs 1,613 830 1,539 1,490 3,952 7,811
Non-investment capex 438 643 1,411
1,090 1,162 4,306 Total Capital Expenditures $ 3,980
$ 4,409 $ 6,370 $ 4,374 $ 8,902 $ 24,055
Square foot & leased percentages March 31,
December 31, 2016 2015 Owned portfolio of commercial real estate
Number of properties (a) 35 36 Square feet 9,325,249 9,494,953
Leased percentage 90.2% 91.6% Investments in
non-consolidated REITs Number of properties 2 2 Square feet
1,396,071 1,396,071 Leased percentage 73.9% 73.5% Single
Asset REITs (SARs) managed Number of properties 6 7 Square feet
1,191,135 1,487,026 Leased percentage 75.8% 77.0% Total
owned, investments & managed properties Number of properties 43
45 Square feet 11,912,455 12,378,050 Leased percentage 86.8% 87.8%
(a) Excludes property in redevelopment in
2016.
The following table shows property information for our
investments in non-consolidated REITs:
Square % Leased % Interest Single Asset REIT name City State
Feet 31-Mar-16 Held FSP 303 East Wacker Drive Corp. Chicago IL
861,000 65.7% 43.7% FSP Grand Boulevard Corp. Kansas City MO
535,071 87.2% 27.0% 1,396,071 73.9%
Franklin Street Properties Corp. Earnings
ReleaseSupplementary Schedule FPercentage of Leased Space(Unaudited
& Estimated)
Fourth First % Leased (1) Quarter %
Leased (1) Quarter as of Average % as
of Average % Property Name Location
Square Feet 31-Dec-15 Leased (2)
31-Mar-16 Leased (2) 1 HILLVIEW CENTER
Milpitas, CA 36,288 100.0% 100.0% 100.0% 100.0% 2 FOREST PARK
Charlotte, NC 62,212 100.0% 100.0% 100.0% 100.0% 3 MEADOW POINT
Chantilly, VA 138,537 100.0% 100.0% 100.0% 100.0% 4 TIMBERLAKE
Chesterfield, MO 234,023 95.4% 94.3% 95.4% 95.4% 5 FEDERAL WAY
Federal Way, WA 117,010 66.8% 64.9% 61.6% 65.1% 6 NORTHWEST POINT
Elk Grove Village, IL 176,848 100.0% 100.0% 100.0% 100.0% 7
TIMBERLAKE EAST Chesterfield, MO 116,197 96.2% 61.2% 96.2% 96.2% 8
PARK TEN Houston, TX 157,460 63.1% 63.1% 63.1% 63.1% 9 ADDISON
Addison, TX 290,041 93.4% 93.4% 93.4% 93.4% 10 COLLINS CROSSING
Richardson, TX 300,887 100.0% 100.0% 100.0% 100.0% 11 GREENWOOD
PLAZA Englewood, CO 196,236 100.0% 100.0% 100.0% 100.0% 12 RIVER
CROSSING Indianapolis, IN 205,059 91.1% 91.1% 91.1% 91.1% 13
LIBERTY PLAZA Addison, TX 218,934 81.8% 79.2% 80.9% 81.5% 14
INNSBROOK Glen Allen, VA 298,456 100.0% 100.0% 100.0% 100.0% 15 380
INTERLOCKEN Broomfield, CO 240,185 97.1% 97.1% 97.1% 97.1% 16 BLUE
LAGOON Miami, FL 212,619 100.0% 100.0% 100.0% 100.0% 17 ELDRIDGE
GREEN Houston, TX 248,399 100.0% 100.0% 100.0% 100.0% 18 ONE
OVERTON PARK Atlanta, GA 387,267 85.0% 85.0% 85.0% 85.0% 19 390
INTERLOCKEN Broomfield, CO 241,516 84.6% 85.1% 84.6% 84.6% 20 EAST
BALTIMORE Baltimore, MD 325,445 85.4% 85.4% 83.6% 84.8% 21 PARK TEN
PHASE II Houston, TX 156,746 100.0% 100.0% 100.0% 100.0% 22
LAKESIDE CROSSING I Maryland Heights, MO 127,778 100.0% 100.0%
100.0% 100.0% 23 LOUDOUN TECH Dulles, VA 136,658 92.0% 92.0% 92.0%
92.0% 24 4807 STONECROFT Chantilly, VA 111,469 100.0% 100.0% 100.0%
100.0% 25 121 SOUTH EIGHTH ST Minneapolis, MN 305,990 88.3% 88.3%
56.2% 56.2% 801 MARQUETTE AVE (3) Minneapolis, MN — 97.2% 97.2%
(3) (3) 26 EMPEROR BOULEVARD Durham, NC 259,531
100.0% 100.0% 100.0% 100.0% 27 LEGACY TENNYSON CTR Plano, TX
202,600 100.0% 100.0% 100.0% 100.0% 28 ONE LEGACY Plano, TX 214,110
100.0% 100.0% 100.0% 100.0% 29 909 DAVIS Evanston, IL 195,245
100.0% 100.0% 88.8% 88.8% 30 ONE RAVINIA DRIVE Atlanta, GA 386,603
94.8% 94.8% 94.8% 94.8% 31 TWO RAVINIA Atlanta, GA 442,130 80.8%
78.6% 84.0% 82.2% 32 WESTCHASE I & II Houston, TX 629,025 87.0%
87.8% 87.0% 87.0% 33 1999 BROADWAY Denver, CO 676,379 82.7% 82.7%
83.0% 82.8% 34 999 PEACHTREE Atlanta, GA 621,946 95.0% 95.2% 95.3%
95.1% 35 1001 17th STREET Denver, CO 655,420
88.6% 87.6% 87.6%
87.9%
TOTAL WEIGHTED AVERAGE 9,325,249
91.6% 90.8%
90.2% 90.2%
(1) % Leased as of month's end includes all leases that expire
on the last day of the quarter.
(2) Average quarterly percentage is the average of the end of
the month leased percentage for each of the 3 months during the
quarter.
(3) Property is being redeveloped in 2016.
Franklin Street Properties Corp. Earnings
ReleaseSupplementary Schedule GLargest 20 Tenants – FSP Owned
Portfolio(Unaudited & Estimated)
The following table includes the largest 20
tenants in FSP’s owned portfolio based on total square feet:
As of March 31, 2016
% of Tenant Sq Ft
Portfolio 1 Quintiles Transnational Corp 259,531 3.1% 2 CITGO
Petroleum Corporation 248,399 3.0% 3 Newfield Exploration Company
234,495 2.8% 4 US Government 223,433 2.7% 5 Sutherland Asbill
Brennan LLP 222,422 2.6% 6 Burger King Corporation 212,619 2.5% 7
Denbury Onshore, LLC 202,600 2.4% 8 SunTrust Bank 182,888 2.2% 9
Centene Management Company, LLC 179,637 2.1% 10 Citicorp Credit
Services, Inc 176,848 2.1% 11 T-Mobile South, LLC dba T-Mobile
151,792 1.8% 12 Petrobras America, Inc. 144,813 1.7% 13 Murphy
Exploration & Production Company 144,677 1.7% 14 Argo Data
Resource Corporation 140,246 1.7% 15 Houghton Mifflin Harcourt
Publishing Company 128,226 1.5% 16 Monsanto Company 127,778 1.5% 17
Federal National Mortgage Association 123,144 1.5% 18 Vail Corp
d/b/a Vail Resorts 122,232 1.5% 19 Kaiser Foundation Health Plan
120,979 1.4% 20 Giesecke & Devrient America 112,110
1.3% Total 3,458,869 41.1%
Franklin Street Properties Corp. Earnings
ReleaseSupplementary Schedule HDefinition of Funds From Operations
(“FFO”) andAdjusted Funds From Operations (“AFFO”)
Funds From Operations (“FFO”)
The Company evaluates performance based on Funds From
Operations, which we refer to as FFO. The Company defines FFO as
net income (computed in accordance with GAAP), excluding gains (or
losses) from sales of property and acquisition costs of newly
acquired properties 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.
FFO should not be considered as an alternative to net income
(determined in accordance with GAAP), nor as an indicator of the
Company’s financial performance, nor as an alternative to cash
flows from operating activities (determined in accordance with
GAAP), nor as a measure of the Company’s liquidity, nor is it
necessarily indicative of sufficient cash flow to fund all of the
Company’s needs.
Other real estate companies and NAREIT, may define this term in
a different manner. We have included the NAREIT FFO definition in
our table and note that other REITs may not define FFO in
accordance with the current NAREIT definition or may interpret the
current NAREIT definition differently than we do.
We believe that in order to facilitate a clear understanding of
the results of the Company, FFO should be examined in connection
with net income and cash flows from operating, investing and
financing activities in the consolidated financial statements.
Adjusted Funds From Operations (“AFFO”)
The Company also evaluates performance based on Adjusted Funds
From Operations, which we refer to as AFFO. The Company defines
AFFO as the sum of (1) FFO; (2) excluding our proportionate share
of FFO and including distributions received, from non-consolidated
REITs; (3) excluding the effect of straight-line rent; (4) plus
deferred financing costs, (5) less recurring capital expenditures
that are generally for maintenance of properties, which we call
non-investment capex or are second generation capital expenditures.
Second generation costs include re-tenanting space after a tenant
vacates, which include tenant improvements and leasing
commissions.
We exclude development/redevelopment activities, capital
expenditures planned at acquisition and costs to reposition a
property. We also exclude first generation leasing costs, which are
generally to fill vacant space in properties we acquire or were
planned for at acquisition.
AFFO should not be considered as an alternative to net income
(determined in accordance with GAAP), as an indicator of the
Company’s financial performance, nor as an alternative to cash
flows from operating activities (determined in accordance with
GAAP), nor as a measure of the Company’s liquidity, nor is it
necessarily indicative of sufficient cash flow to fund all of the
Company’s needs. Other real estate companies may define this term
in a different manner. We believe that in order to facilitate a
clear understanding of the results of the Company, AFFO should be
examined in connection with net income and cash flows from
operating, investing and financing activities in the consolidated
financial statements.
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version on businesswire.com: http://www.businesswire.com/news/home/20160426006801/en/
Franklin Street Properties Corp.Georgia Touma, 877-686-9496
Franklin Street Properties (AMEX:FSP)
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