Post Properties, Inc. (NYSE: PPS) announced today net income
available to common shareholders of $0.8 million for the first quarter
of 2008, compared to $22.6 million for the first quarter of 2007. On a
diluted per share basis, net income available to common shareholders
was $0.02 for the first quarter of 2008, compared to $0.51 for the
first quarter of 2007. The Company's net income available to common
shareholders for the first quarter of 2008 included a charge of
approximately $6.1 million, or $0.14 per diluted share, related to the
process underway to seek potential acquisition proposals for the
Company. The Company's reported net income for the quarters ended
March 31, 2008 and 2007 included net gains on the sales of apartment
communities of approximately $2.3 million and $16.7 million,
respectively.
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 first quarter of 2008 totaled $13.9 million, or $0.31
per diluted share, compared to $20.7 million, or $0.46 per diluted
share, for the first quarter of 2007. The Company's reported FFO for
the first quarter of 2008 included the charge of approximately $6.1
million, or $0.14 per diluted share, discussed above. The Company's
reported FFO for the first quarter of 2007 included a net gain of
approximately $2.2 million, or $0.05 per diluted share, on the sale of
a land site in Atlanta, Georgia.
Mature (Same Store) Community Data For the first quarter of 2008, average economic occupancy at the
Company's 42 mature (same store) communities, containing 15,565
apartment units, was 94.5%, compared to 94.0% for the first quarter of
2007.
Total revenues for the mature communities increased 3.1% during
the first quarter of 2008, compared to the first quarter of 2007, and
operating expenses increased 5.1%, producing a 1.9% increase in same
store net operating income ("NOI"), or $0.7 million. The average
monthly rental rate per unit increased 2.8% during the first quarter
of 2008, compared to the first quarter of 2007. Property tax,
insurance and maintenance expenses accounted for a majority of the
increase in operating expenses.
On a sequential basis, total revenues for the mature communities
decreased 0.4% and operating expenses increased 8.1% producing a 5.1%
decrease in same store NOI for the first quarter of 2008, compared to
the fourth quarter of 2007, or $2.0 million. On a sequential basis,
the average monthly rental rate per unit increased 0.1%. Property tax,
personnel and utility expenses accounted for a majority of the
sequential increase in operating expenses. For the first quarter of
2008, average economic occupancy at the mature communities was 94.5%,
compared to 94.8% for the fourth quarter of 2007.
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. Same store NOI by geographic market is also included in
the financial data (Table 3) accompanying this press release.
Development, Dispositions and Other Investment Activity Development Activity As of March 31, 2008, the Company's aggregate pipeline of
development projects under construction totaled approximately $586
million (including the Company's share, net of joint venture partner
interests, of $540 million). The Company also owns land for which it
is in pre-development with respect to approximately 3,311 rental
apartment units and approximately 199,000 square feet of retail
amenities. Total projected future development costs of this
pre-development pipeline are estimated to be approximately $760
million. There can be no assurance that projects in pre-development
will commence construction in the future or at all or that actual
pre-development costs will approximate estimated costs.
Disposition Activity The Company previously announced the January 2008 closing of the
sale of Post Wilson Building(TM) located in Dallas, Texas for a gross
sales price of approximately $19.9 million. Post Wilson Building(TM)
contains 143 apartment units and is an historical building located in
downtown Dallas that the Company renovated in 1999. The sale of this
community completed a Section 1031 tax-deferred exchange transaction
in conjunction with its acquisition of Post Lake(R) at Baldwin Park in
Orlando, Florida in August 2007.
The Company is currently marketing for sale two apartment
communities located in Atlanta, Georgia. The two garden style
communities together comprise 744 apartment units. Gross proceeds from
the sales of these two communities are currently expected to be
approximately $100 million. There can be no assurance that the gross
proceeds will be realized or that these sales will close. At March 31,
2008, these two communities were classified as held for sale
communities.
Apartment Community Renovation Program In the first quarter of 2008, the Company commenced substantial
renovations and improvements on two additional apartment communities -
Post Heights(TM), containing 368 units and located in Dallas, Texas,
and Post Peachtree Hills(R), containing 300 units and located in
Atlanta, Georgia. The Company also continues its renovations and
improvements on Post Chastain(R), containing 558 units, located in
Atlanta, Georgia. The Company believes that the long-term value of
these three communities will be enhanced as a result of the
renovations; however, operating results at these three communities
will be affected negatively by increased vacancy during the renovation
period. As of March 31, 2008, the Company had completed the renovation
of 538 units (96% of the total) at Post Chastain(R) and three units
(1% of the total) at Post Peachtree Hills(R).
Condominium Activity The Company recognized approximately $1.1 million of incremental
gains, or $0.025 per diluted share, on condominium sales, net of
minority interest, in FFO during the first quarter of 2008, compared
to net losses of approximately $0.1 million, or less than $0.01 per
diluted share, during the first quarter of 2007. The Company provides
additional information on its condominium activities on page 17 of its
Supplemental Financial Data.
Financing Activity In January 2008, the Company closed a 7-year (with an automatic
1-year extension), fixed-to-floating, $120 million secured mortgage
loan with Freddie Mac. The loan has a fixed interest rate of 4.88% and
matures on February 1, 2016, including the one-year floating rate
extension option. The loan was priced at 168 basis points over the
applicable Treasury rate. Net loan proceeds were used to repay
outstanding borrowings on the Company's unsecured, variable line of
credit. This loan is secured by a mortgage on the Company's Post
Addison Circle(TM) community.
Total debt and preferred equity as a percentage of undepreciated
real estate assets (adjusted for joint venture partners' share of
debt) was 42.0% at March 31, 2008, and variable rate debt as a
percentage of total debt was 9.3% as of that same date. As of March
31, 2008, the Company had outstanding borrowings of approximately $95
million on its combined $630 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.
Board Authorization to Seek a Potential Sale of the Company On January 23, 2008, the Company announced that its Board of
Directors had authorized management, working with financial and legal
advisors, to initiate a formal process to pursue a potential sale or
other business combination and to seek proposals from potentially
interested parties. The process commenced immediately after the
announcement.
The Company does not expect to disclose information regarding the
status of the process until it has been completed. There can be no
assurance that the process will result in a sale or other business
combination.
As a result of the commencement of the process discussed above,
the Company will not provide earnings or FFO guidance for the second
quarter or full year of 2008.
As a result of this announcement, both Standard and Poors and
Moody's rating agencies placed the Company's credit rating outlook on
"credit watch" or "developing," pending the outcome of the sale
process.
Supplemental Financial Data The Company also produces Supplemental Financial Data that
includes detailed information regarding the Company's operating
results and balance sheet. 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 investor
relations/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 4.0 Reader, which may be downloaded at
http://www.adobe.com/products /acrobat/readstep.html.
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 23 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 non-cash impact of straight-line, long-term ground lease
expense and other income related to the mark-to-market of an interest
rate swap arrangement. 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 - 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 are the lines on the Company's consolidated
statements of cash flows entitled "annually recurring capital
expenditures" and "periodically recurring 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) an interest coverage ratio; (2) a
fixed charge coverage ratio; (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; and (8) a ratio of
consolidated income available to debt service to annual debt service
charge. 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.
Average Economic Occupancy - The Company uses average economic
occupancy as a statistical measure of 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.
Conference Call Information The Company will hold its quarterly conference call on Tuesday,
May 6, at 10:00 a.m. ET. The telephone numbers are 888-663-2242 for US
and Canada callers and 913-312-9315 for international callers. The
access code is 2429038. The conference call will be open to the public
and can be listened to live on Post's website at
www.postproperties.com under investor relations/event calendar. The
replay will begin at 1:00 p.m. ET on May 6, and will be available
until Monday, May 12, 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 2429038. A
replay of the call also will be archived on Post's website under
investor relations/audio archive. The financial and statistical
information that will be discussed on the call is contained in this
press release and the Supplemental Financial Data. Both documents will
be available through the investor relations/financial
reports/quarterly & other section of the Company's website at
www.postproperties.com.
Post Properties, founded more than 36 years ago, is one of the
largest developers and operators of upscale multifamily communities in
the United States. 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(R) branded resort-style garden
and high density urban apartments. In addition, the Company develops
high-quality condominiums and converts existing apartments to for-sale
multifamily communities. Post Properties is headquartered in Atlanta,
Georgia, and has operations in ten markets across the country.
Post Properties owns 22,437 apartment homes in 62 communities,
including 1,747 apartment units in five communities held in
unconsolidated entities, 2,266 apartment units in seven communities
(and the expansion of one community) currently under construction
and/or in lease-up. The Company is also developing and selling 535
for-sale condominium homes in four communities (including 137 units in
one community held in an unconsolidated entity) and is converting
apartment units in two communities initially consisting of 349 units
into for-sale condominium homes 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 the
Company's anticipated development and sales activities (including the
projected sales proceeds and costs for such activities) and
anticipated renovation projects. 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 to differ materially from the expected
results 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 dated December 31, 2007, as amended; future local
and national economic conditions, including changes in job growth,
interest rates, the availability of financing and other factors;
demand for apartments in the Company's markets and the effect on
occupancy and rental rates; the impact of competition on the Company's
business, including competition for tenants and development locations
for its apartment communities and competing for-sale housing in the
markets where the Company is completing condominium conversions or
developing new condominiums; the Company's ability to obtain financing
or self-fund the development or acquisition of additional multifamily
rental and for-sale housing; the uncertainties associated with the
Company's current and planned future real estate development,
including actual costs exceeding the Company's budgets or development
periods exceeding expectations; uncertainties associated with the
timing and amount of asset sales and the resulting gains/losses
associated with such asset sales; uncertainties associated with the
Company's expansion into the condominium conversion and for-sale
housing business; conditions affecting ownership of residential real
estate and general conditions in the multifamily residential real
estate market; uncertainties associated with environmental and other
regulatory matters; the impact of our ongoing litigation with the
Equal Rights Center regarding compliance with the Americans with
Disabilities Act and the Fair Housing Act (including any award of
compensatory or punitive damages or injunctive relief requiring us to
retrofit apartments or public use areas or prohibiting the sale of
apartment communities or condominium units) as well as the impact of
other litigation; the effects of changes in accounting policies and
other regulatory matters detailed in the Company's filings with the
Securities and Exchange Commission; the Company's ability to continue
to qualify as a real estate investment trust under the Internal
Revenue Code; and the progress and results of the Company's formal
process to pursue a potential sale or other business combination. Other important risk factors regarding the Company are included under
the caption "Risk Factors" in the Company's Annual Report on Form 10-K
dated December 31, 2007, as amended, and may be discussed in
subsequent filings with the SEC. The risk factors discussed in Form
10-K, as amended, under the caption "Risk Factors" are specifically
incorporated by reference into this press release.
-0-
*T
Financial Highlights
(Unaudited; in thousands, except per share and unit amounts) Three months
ended
March 31,
---------------
2008 2007
------- -------
OPERATING DATA
Revenues from continuing operations $74,927 $73,018
Net income available to common shareholders $ 777 $22,562
Funds from operations available to common shareholders
and
unitholders (Table 1) $13,908 $20,702 Weighted average shares outstanding - diluted 43,875 44,101
Weighted average shares and units outstanding -
diluted 44,278 44,776 PER COMMON SHARE DATA - DILUTED
Net income available to common shareholders $ 0.02 $ 0.51 Funds from operations available to common shareholders
and
unitholders (Table 1) (1) $ 0.31 $ 0.46 Dividends declared $ 0.45 $ 0.45 (1) Funds from operations per share were computed using weighted
average shares and units outstanding, including the impact of
dilutive securities totaling 419 shares and units for the three
months ended March 31, 2008. Such dilutive securities were
antidilutive to the income (loss) per share computations for the
three months ended March 31, 2008 since the Company reported a per
share loss from continuing operations under generally accepted
accounting principles for such period. *T -0-
*T
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
March 31,
------------------
2008 2007
-------- ---------
Net income available to common shareholders $ 777 $ 22,562
Minority interest of common unitholders -
continuing operations (22) 67
Minority interest in discontinued operations 29 284
Depreciation on wholly-owned real estate assets,
net 15,700 16,489
Depreciation on real estate assets held in
unconsolidated entities 350 226
Gains on sales of real estate assets (4,430) (18,661)
Incremental gains (losses) on condominium sales
(1) 1,504 (196)
Gains on sales of real estate assets -
unconsolidated entities - (202)
Incremental gains on condominium sales -
unconsolidated entities (1) - 133
-------- ---------
Funds from operations available to common
shareholders and unitholders $13,908 $ 20,702
======== ========= Funds from operations - per share and unit -
diluted (2) $ 0.31 $ 0.46
======== =========
Weighted average shares and units outstanding -
diluted (2) 44,697 44,776
======== ========= (1) For condominium conversion projects, the Company recognizes
incremental gains on condominium sales in FFO, net of provision for
income taxes, to the extent that net sales proceeds, less costs of
sales and expenses, from the sale of condominium units exceeds the
greater of their fair value or net book value as of the date the
property is acquired by the Company's taxable REIT subsidiary. For
condominium development projects, gains on condominium sales in FFO
are equivalent to gains reported under GAAP. See the table entitled
"Summary of Condominium Projects" on page 17 of the Supplemental
Financial Data for further detail. (2) Funds from operations per share were computed using weighted
average shares and units outstanding, including the impact of
dilutive securities totaling 419 shares and units for the three
months ended March 31, 2008. Such dilutive securities were
antidilutive to the income (loss) per share computations for the
three months ended March 31, 2008 since the Company reported a per
share loss from continuing operations under generally accepted
accounting principles for such period. *T -0-
*T
Table 2
Reconciliation of Same Store Net Operating Income (NOI) to GAAP Net
Income
(Unaudited; In thousands) Three months ended
-----------------------------
March 31, March 31, December
31,
2008 2007 2007
--------- --------- ---------
Total same store NOI $ 36,567 $ 35,902 $ 38,552
Property NOI from other operating
segments 2,508 2,879 3,052
--------- --------- ---------
Consolidated property NOI 39,075 38,781 41,604
--------- --------- ---------
Add (subtract):
Interest income 210 250 170
Other revenues 239 117 186
Minority interest in consolidated
property partnerships (466) (20) (441)
Depreciation (15,961) (16,255) (16,084)
Interest expense (11,703) (12,741) (12,837)
Amortization of deferred financing
costs (851) (812) (828)
General and administrative (5,848) (5,448) (5,169)
Investment and development (1,458) (1,550) (1,551)
Strategic review costs (6,070) - -
Gains on sales of real estate assets,
net 2,119 3,706 28,509
Equity in income of unconsolidated
real estate entities 401 504 340
Other income (expense) (174) (261) (314)
Minority interest of common unitholders 22 (67) (408)
--------- --------- --------- Income (loss) from continuing
operations (465) 6,204 33,177
Income from discontinued operations 3,151 18,267 46,065
--------- --------- --------- Net income $ 2,686 $ 24,471 $ 79,242
========= ========= =========
*T -0-
*T
Table 3
Same Store Net Operating Income (NOI) Summary by Market
(In thousands) Three Months Ended Q1 '08 Q1 '08 Q1 '08
-----------------------
March March Decembervs. Q1 vs. Q4
31, 31, 31, '07 '07 % Same
Store
2008 2007 2007 % Change% Change NOI
------- ------- ------- ----------------------
Rental and other
revenues
Atlanta $18,500 $17,859 $18,612 3.6% (0.6)%
Dallas 10,031 9,567 10,064 4.9% (0.3)%
Washington, D.C. 10,366 10,157 10,400 2.1% (0.3)%
Tampa 7,181 7,327 7,198 (2.0)% (0.2)%
Charlotte 4,784 4,659 4,835 2.7% (1.1)%
New York 3,768 3,522 3,806 7.0% (1.0)%
Houston 3,030 2,828 3,006 7.1% 0.8%
Austin 1,241 1,177 1,227 5.4% 1.1%
Orlando 1,015 1,032 1,006 (1.6)% 0.9%
------- ------- -------
Total rental and other
revenues 59,916 58,128 60,154 3.1% (0.4)%
------- ------- ------- Property operating and
maintenance expenses
(exclusive of
depreciation and
amortization)
Atlanta 7,067 6,815 6,803 3.7% 3.9%
Dallas 4,501 4,094 4,125 9.9% 9.1%
Washington, D.C. 3,490 3,329 3,270 4.8% 6.7%
Tampa 2,976 2,930 2,858 1.6% 4.1%
Charlotte 1,566 1,629 1,298 (3.9)% 20.6%
New York 1,396 1,098 1,104 27.1% 26.4%
Houston 1,334 1,284 1,197 3.9% 11.4%
Austin 594 606 548 (2.0)% 8.4%
Orlando 425 441 399 (3.6)% 6.5%
------- ------- -------
Total 23,349 22,226 21,602 5.1% 8.1%
------- ------- ------- Net operating income
Atlanta 11,433 11,044 11,809 3.5% (3.2)% 31.3%
Dallas 5,530 5,473 5,939 1.0% (6.9)% 15.1%
Washington, D.C. 6,876 6,828 7,130 0.7% (3.6)% 18.8%
Tampa 4,205 4,397 4,340 (4.4)% (3.1)% 11.5%
Charlotte 3,218 3,030 3,537 6.2% (9.0)% 8.8%
New York 2,372 2,424 2,702 (2.1)% (12.2)% 6.5%
Houston 1,696 1,544 1,809 9.8% (6.2)% 4.6%
Austin 647 571 679 13.3% (4.7)% 1.8%
Orlando 590 591 607 (0.2)% (2.8)% 1.6%
------- ------- ------- ------
Total same store NOI $36,567 $35,902 $38,552 1.9% (5.1)% 100.0%
======= ======= ======= ======
*T -0-
*T
Table 4
Computation of Debt Ratios
(In thousands) As of March 31,
-----------------------
2008 2007
----------- -----------
Total real estate assets per balance sheet $2,118,984 $2,039,487
Plus:
Company share of real estate assets held in
unconsolidated entities 92,441 40,252
Company share of accumulated depreciation -
assets held in unconsolidated entities 5,691 4,055
Accumulated depreciation per balance sheet 553,589 563,344
Accumulated depreciation on assets held for
sale 24,333 -
----------- -----------
Total undepreciated real estate assets (A) $2,795,038 $2,647,138
=========== =========== Total debt per balance sheet $1,015,645 $1,033,984
Plus:
Company share of third party debt held in
unconsolidated entities 62,757 23,449
Less:
Joint venture partners' share of mortgage debt
of the company - (8,550)
----------- -----------
Total debt (adjusted for joint venture
partners' share of debt) (B) $1,078,402 $1,048,883
=========== =========== Total debt as a % of undepreciated real estate
assets (adjusted for joint venture partners'
share of debt (B/A) 38.6% 39.6%
=========== =========== Total debt per balance sheet $1,015,645 $1,033,984
Plus:
Company share of third party debt held in
unconsolidated entities 62,757 23,449
Preferred shares at liquidation value 95,000 95,000
Less:
Joint venture partners' share of mortgage debt
of the company - (8,550)
----------- -----------
Total debt and preferred equity (adjusted for
joint venture partners' share of debt) (C) $1,173,402 $1,143,883
=========== =========== Total debt and preferred equity as a % of
undepreciated real estate assets (adjusted
for joint venture partners' share of debt)
(C/A) 42.0% 43.2%
=========== ===========
*T
Post Properties, Inc. (NYSE: PPS) announced today net income available
to common shareholders of $0.8 million for the first quarter of 2008,
compared to $22.6 million for the first quarter of 2007. On a diluted
per share basis, net income available to common shareholders was $0.02
for the first quarter of 2008, compared to $0.51 for the first quarter
of 2007. The Company’s net income available to
common shareholders for the first quarter of 2008 included a charge of
approximately $6.1 million, or $0.14 per diluted share, related to the
process underway to seek potential acquisition proposals for the
Company. The Company’s reported net income for
the quarters ended March 31, 2008 and 2007 included net gains on the
sales of apartment communities of approximately $2.3 million and $16.7
million, respectively.
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 first quarter of 2008 totaled $13.9 million, or $0.31 per
diluted share, compared to $20.7 million, or $0.46 per diluted share,
for the first quarter of 2007. The Company’s
reported FFO for the first quarter of 2008 included the charge of
approximately $6.1 million, or $0.14 per diluted share, discussed above.
The Company’s reported FFO for the first
quarter of 2007 included a net gain of approximately $2.2 million, or
$0.05 per diluted share, on the sale of a land site in Atlanta, Georgia.
Mature (Same Store) Community Data
For the first quarter of 2008, average economic occupancy at the Company’s
42 mature (same store) communities, containing 15,565 apartment units,
was 94.5%, compared to 94.0% for the first quarter of 2007.
Total revenues for the mature communities increased 3.1% during the
first quarter of 2008, compared to the first quarter of 2007, and
operating expenses increased 5.1%, producing a 1.9% increase in same
store net operating income (“NOI”),
or $0.7 million. The average monthly rental rate per unit increased 2.8%
during the first quarter of 2008, compared to the first quarter of 2007.
Property tax, insurance and maintenance expenses accounted for a
majority of the increase in operating expenses.
On a sequential basis, total revenues for the mature communities
decreased 0.4% and operating expenses increased 8.1% producing a 5.1%
decrease in same store NOI for the first quarter of 2008, compared to
the fourth quarter of 2007, or $2.0 million. On a sequential basis, the
average monthly rental rate per unit increased 0.1%. Property tax,
personnel and utility expenses accounted for a majority of the
sequential increase in operating expenses. For the first quarter of
2008, average economic occupancy at the mature communities was 94.5%,
compared to 94.8% for the fourth quarter of 2007.
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. Same store NOI by geographic market is also included in
the financial data (Table 3) accompanying this press release.
Development, Dispositions and Other Investment Activity
Development Activity
As of March 31, 2008, the Company’s aggregate
pipeline of development projects under construction totaled
approximately $586 million (including the Company’s
share, net of joint venture partner interests, of $540 million). The
Company also owns land for which it is in pre-development with respect
to approximately 3,311 rental apartment units and approximately 199,000
square feet of retail amenities. Total projected future development
costs of this pre-development pipeline are estimated to be approximately
$760 million. There can be no assurance that projects in pre-development
will commence construction in the future or at all or that actual
pre-development costs will approximate estimated costs.
Disposition Activity
The Company previously announced the January 2008 closing of the sale of
Post Wilson Building™ located in Dallas,
Texas for a gross sales price of approximately $19.9 million. Post
Wilson Building™ contains 143 apartment units
and is an historical building located in downtown Dallas that the
Company renovated in 1999. The sale of this community completed a
Section 1031 tax-deferred exchange transaction in conjunction with its
acquisition of Post Lake® at Baldwin Park in
Orlando, Florida in August 2007.
The Company is currently marketing for sale two apartment communities
located in Atlanta, Georgia. The two garden style communities together
comprise 744 apartment units. Gross proceeds from the sales of these two
communities are currently expected to be approximately $100 million.
There can be no assurance that the gross proceeds will be realized or
that these sales will close. At March 31, 2008, these two communities
were classified as held for sale communities.
Apartment Community Renovation Program
In the first quarter of 2008, the Company commenced substantial
renovations and improvements on two additional apartment communities –
Post Heights™, containing 368 units and
located in Dallas, Texas, and Post Peachtree Hills®,
containing 300 units and located in Atlanta, Georgia. The Company also
continues its renovations and improvements on Post Chastain®,
containing 558 units, located in Atlanta, Georgia. The Company believes
that the long-term value of these three communities will be enhanced as
a result of the renovations; however, operating results at these three
communities will be affected negatively by increased vacancy during the
renovation period. As of March 31, 2008, the Company had completed the
renovation of 538 units (96% of the total) at Post Chastain®
and three units (1% of the total) at Post Peachtree Hills®.
Condominium Activity
The Company recognized approximately $1.1 million of incremental gains,
or $0.025 per diluted share, on condominium sales, net of minority
interest, in FFO during the first quarter of 2008, compared to net
losses of approximately $0.1 million, or less than $0.01 per diluted
share, during the first quarter of 2007. The Company provides additional
information on its condominium activities on page 17 of its Supplemental
Financial Data.
Financing Activity
In January 2008, the Company closed a 7-year (with an automatic 1-year
extension), fixed-to-floating, $120 million secured mortgage loan with
Freddie Mac. The loan has a fixed interest rate of 4.88% and matures on
February 1, 2016, including the one-year floating rate extension option.
The loan was priced at 168 basis points over the applicable Treasury
rate. Net loan proceeds were used to repay outstanding borrowings on the
Company’s unsecured, variable line of credit.
This loan is secured by a mortgage on the Company’s
Post Addison Circle™ community.
Total debt and preferred equity as a percentage of undepreciated real
estate assets (adjusted for joint venture partners’
share of debt) was 42.0% at March 31, 2008, and variable rate debt as a
percentage of total debt was 9.3% as of that same date. As of March 31,
2008, the Company had outstanding borrowings of approximately $95
million on its combined $630 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.
Board Authorization to Seek a Potential Sale of the Company
On January 23, 2008, the Company announced that its Board of Directors
had authorized management, working with financial and legal advisors, to
initiate a formal process to pursue a potential sale or other business
combination and to seek proposals from potentially interested parties.
The process commenced immediately after the announcement.
The Company does not expect to disclose information regarding the status
of the process until it has been completed. There can be no assurance
that the process will result in a sale or other business combination.
As a result of the commencement of the process discussed above, the
Company will not provide earnings or FFO guidance for the second quarter
or full year of 2008.
As a result of this announcement, both Standard and Poors and Moody’s
rating agencies placed the Company’s credit
rating outlook on “credit watch”
or “developing,”
pending the outcome of the sale process.
Supplemental Financial Data
The Company also produces Supplemental Financial Data that includes
detailed information regarding the Company’s
operating results and balance sheet. 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 investor relations/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 4.0 Reader, which may be downloaded
at http://www.adobe.com/products
/acrobat/readstep.html.
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 23 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 non-cash impact of
straight-line, long-term ground lease expense and other income related
to the mark-to-market of an interest rate swap arrangement. 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 – 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
are the lines on the Company’s consolidated
statements of cash flows entitled “annually
recurring capital expenditures” and “periodically
recurring 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) an interest
coverage ratio; (2) a fixed charge coverage ratio; (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; and (8) a ratio of consolidated income
available to debt service to annual debt service charge. 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.
Average Economic Occupancy – The
Company uses average economic occupancy as a statistical measure of
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.
Conference Call Information
The Company will hold its quarterly conference call on Tuesday, May 6,
at 10:00 a.m. ET. The telephone numbers are 888-663-2242 for US and
Canada callers and 913-312-9315 for international callers. The access
code is 2429038. The conference call will be open to the public and can
be listened to live on Post’s website at www.postproperties.com
under investor relations/event calendar. The replay will begin at 1:00
p.m. ET on May 6, and will be available until Monday, May 12, 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 2429038. A replay of the call also will be
archived on Post’s website under investor
relations/audio archive. The financial and statistical information that
will be discussed on the call is contained in this press release and the
Supplemental Financial Data. Both documents will be available through
the investor relations/financial reports/quarterly & other section of
the Company’s website at www.postproperties.com.
Post Properties, founded more than 36 years ago, is one of the largest
developers and operators of upscale multifamily communities in the
United States. 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. In
addition, the Company develops high-quality condominiums and converts
existing apartments to for-sale multifamily communities. Post Properties
is headquartered in Atlanta, Georgia, and has operations in ten markets
across the country.
Post Properties owns 22,437 apartment homes in 62 communities, including
1,747 apartment units in five communities held in unconsolidated
entities, 2,266 apartment units in seven communities (and the expansion
of one community) currently under construction and/or in lease-up. The
Company is also developing and selling 535 for-sale condominium homes in
four communities (including 137 units in one community held in an
unconsolidated entity) and is converting apartment units in two
communities initially consisting of 349 units into for-sale condominium
homes 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 the Company’s
anticipated development and sales activities (including the projected
sales proceeds and costs for such activities) and anticipated renovation
projects. 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 to differ materially from the expected results 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 dated December
31, 2007, as amended; future local and national economic conditions,
including changes in job growth, interest rates, the availability of
financing and other factors; demand for apartments in the Company’s
markets and the effect on occupancy and rental rates; the impact of
competition on the Company’s business,
including competition for tenants and development locations for its
apartment communities and competing for-sale housing in the markets
where the Company is completing condominium conversions or developing
new condominiums; the Company’s ability to
obtain financing or self-fund the development or acquisition of
additional multifamily rental and for-sale housing; the uncertainties
associated with the Company’s current and
planned future real estate development, including actual costs exceeding
the Company’s budgets or development periods
exceeding expectations; uncertainties associated with the timing and
amount of asset sales and the resulting gains/losses associated with
such asset sales; uncertainties associated with the Company’s
expansion into the condominium conversion and for-sale housing business;
conditions affecting ownership of residential real estate and general
conditions in the multifamily residential real estate market;
uncertainties associated with environmental and other regulatory
matters; the impact of our ongoing litigation with the Equal Rights
Center regarding compliance with the Americans with Disabilities Act and
the Fair Housing Act (including any award of compensatory or punitive
damages or injunctive relief requiring us to retrofit apartments or
public use areas or prohibiting the sale of apartment communities or
condominium units) as well as the impact of other litigation; the
effects of changes in accounting policies and other regulatory matters
detailed in the Company’s filings with the
Securities and Exchange Commission; the Company’s
ability to continue to qualify as a real estate investment trust under
the Internal Revenue Code; and the progress and results of the Company’s
formal process to pursue a potential sale or other business combination.
Other important risk factors regarding the Company are included under
the caption “Risk Factors”
in the Company’s Annual Report on Form 10-K
dated December 31, 2007, as amended, and may be discussed in subsequent
filings with the SEC. The risk factors discussed in Form 10-K, as
amended, 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
March 31,
2008
2007
OPERATING DATA
Revenues from continuing operations
$
74,927
$
73,018
Net income available to common shareholders
$
777
$
22,562
Funds from operations available to common shareholders and
unitholders (Table 1)
$
13,908
$
20,702
Weighted average shares outstanding - diluted
43,875
44,101
Weighted average shares and units outstanding - diluted
44,278
44,776
PER COMMON SHARE DATA - DILUTED
Net income available to common shareholders
$
0.02
$
0.51
Funds from operations available to common shareholders and
unitholders (Table 1) (1)
$
0.31
$
0.46
Dividends declared
$
0.45
$
0.45
(1) Funds from operations per share were computed using weighted
average shares and units outstanding, including the impact of
dilutive securities totaling 419 shares and units for the three
months ended March 31, 2008. Such dilutive securities were
antidilutive to the income (loss) per share computations for the
three months ended March 31, 2008 since the Company reported a per
share loss from continuing operations under generally accepted
accounting principles for such period.
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
March 31,
2008
2007
Net income available to common shareholders
$
777
$
22,562
Minority interest of common unitholders -
continuing operations
(22
)
67
Minority interest in discontinued operations
29
284
Depreciation on wholly-owned real estate assets, net
15,700
16,489
Depreciation on real estate assets held in
unconsolidated entities
350
226
Gains on sales of real estate assets
(4,430
)
(18,661
)
Incremental gains (losses) on condominium sales (1)
1,504
(196
)
Gains on sales of real estate assets - unconsolidated entities
-
(202
)
Incremental gains on condominium sales - unconsolidated entities (1)
-
133
Funds from operations available to common shareholders and
unitholders
$
13,908
$
20,702
Funds from operations - per share and unit - diluted (2)
$
0.31
$
0.46
Weighted average shares and units outstanding - diluted (2)
44,697
44,776
(1) For condominium conversion projects, the Company recognizes
incremental gains on condominium sales in FFO, net of provision
for income taxes, to the extent that net sales proceeds, less
costs of sales and expenses, from the sale of condominium units
exceeds the greater of their fair value or net book value as of
the date the property is acquired by the Company’s
taxable REIT subsidiary. For condominium development projects,
gains on condominium sales in FFO are equivalent to gains reported
under GAAP. See the table entitled “Summary
of Condominium Projects” on page 17 of
the Supplemental Financial Data for further detail.
(2) Funds from operations per share were computed using weighted
average shares and units outstanding, including the impact of
dilutive securities totaling 419 shares and units for the three
months ended March 31, 2008. Such dilutive securities were
antidilutive to the income (loss) per share computations for the
three months ended March 31, 2008 since the Company reported a per
share loss from continuing operations under generally accepted
accounting principles for such period.
Table 2
Reconciliation of Same Store Net Operating Income (NOI) to GAAP
Net Income
(Unaudited; In thousands)
Three months ended
March 31,
March 31,
December 31,
2008
2007
2007
Total same store NOI
$
36,567
$
35,902
$
38,552
Property NOI from other operating segments
2,508
2,879
3,052
Consolidated property NOI
39,075
38,781
41,604
Add (subtract):
Interest income
210
250
170
Other revenues
239
117
186
Minority interest in consolidated
property partnerships
(466
)
(20
)
(441
)
Depreciation
(15,961
)
(16,255
)
(16,084
)
Interest expense
(11,703
)
(12,741
)
(12,837
)
Amortization of deferred financing costs
(851
)
(812
)
(828
)
General and administrative
(5,848
)
(5,448
)
(5,169
)
Investment and development
(1,458
)
(1,550
)
(1,551
)
Strategic review costs
(6,070
)
-
-
Gains on sales of real estate assets, net
2,119
3,706
28,509
Equity in income of unconsolidated
real estate entities
401
504
340
Other income (expense)
(174
)
(261
)
(314
)
Minority interest of common unitholders
22
(67
)
(408
)
Income (loss) from continuing operations
(465
)
6,204
33,177
Income from discontinued operations
3,151
18,267
46,065
Net income
$
2,686
$
24,471
$
79,242
Table 3
Same Store Net Operating Income (NOI) Summary by Market
(In thousands)
Three Months Ended
Q1 '08
Q1 '08
Q1 '08
March 31,
March 31,
December 31,
vs. Q1 '07
vs. Q4 '07
% Same
2008
2007
2007
% Change
% Change
Store NOI
Rental and other revenues
Atlanta
$
18,500
$
17,859
$
18,612
3.6
%
(0.6
)%
Dallas
10,031
9,567
10,064
4.9
%
(0.3
)%
Washington, D.C.
10,366
10,157
10,400
2.1
%
(0.3
)%
Tampa
7,181
7,327
7,198
(2.0
)%
(0.2
)%
Charlotte
4,784
4,659
4,835
2.7
%
(1.1
)%
New York
3,768
3,522
3,806
7.0
%
(1.0
)%
Houston
3,030
2,828
3,006
7.1
%
0.8
%
Austin
1,241
1,177
1,227
5.4
%
1.1
%
Orlando
1,015
1,032
1,006
(1.6
)%
0.9
%
Total rental and other revenues
59,916
58,128
60,154
3.1
%
(0.4
)%
Property operating and maintenance expenses (exclusive of
depreciation and amortization)
Atlanta
7,067
6,815
6,803
3.7
%
3.9
%
Dallas
4,501
4,094
4,125
9.9
%
9.1
%
Washington, D.C.
3,490
3,329
3,270
4.8
%
6.7
%
Tampa
2,976
2,930
2,858
1.6
%
4.1
%
Charlotte
1,566
1,629
1,298
(3.9
)%
20.6
%
New York
1,396
1,098
1,104
27.1
%
26.4
%
Houston
1,334
1,284
1,197
3.9
%
11.4
%
Austin
594
606
548
(2.0
)%
8.4
%
Orlando
425
441
399
(3.6
)%
6.5
%
Total
23,349
22,226
21,602
5.1
%
8.1
%
Net operating income
Atlanta
11,433
11,044
11,809
3.5
%
(3.2
)%
31.3
%
Dallas
5,530
5,473
5,939
1.0
%
(6.9
)%
15.1
%
Washington, D.C.
6,876
6,828
7,130
0.7
%
(3.6
)%
18.8
%
Tampa
4,205
4,397
4,340
(4.4
)%
(3.1
)%
11.5
%
Charlotte
3,218
3,030
3,537
6.2
%
(9.0
)%
8.8
%
New York
2,372
2,424
2,702
(2.1
)%
(12.2
)%
6.5
%
Houston
1,696
1,544
1,809
9.8
%
(6.2
)%
4.6
%
Austin
647
571
679
13.3
%
(4.7
)%
1.8
%
Orlando
590
591
607
(0.2
)%
(2.8
)%
1.6
%
Total same store NOI
$
36,567
$
35,902
$
38,552
1.9
%
(5.1
)%
100.0
%
Table 4
Computation of Debt Ratios
(In thousands)
As of March 31,
2008
2007
Total real estate assets per balance sheet
$
2,118,984
$
2,039,487
Plus:
Company share of real estate assets held in unconsolidated entities
92,441
40,252
Company share of accumulated depreciation - assets held in
unconsolidated entities
5,691
4,055
Accumulated depreciation per balance sheet
553,589
563,344
Accumulated depreciation on assets held for sale
24,333
-
Total undepreciated real estate assets (A)
$
2,795,038
$
2,647,138
Total debt per balance sheet
$
1,015,645
$
1,033,984
Plus:
Company share of third party debt held in unconsolidated entities
62,757
23,449
Less:
Joint venture partners' share of mortgage debt of the company
-
(8,550
)
Total debt (adjusted for joint venture partners' share of debt) (B)
$
1,078,402
$
1,048,883
Total debt as a % of undepreciated real estate assets (adjusted for
joint venture partners' share of debt (B÷A)
38.6
%
39.6
%
Total debt per balance sheet
$
1,015,645
$
1,033,984
Plus:
Company share of third party debt held in unconsolidated entities
62,757
23,449
Preferred shares at liquidation value
95,000
95,000
Less:
Joint venture partners' share of mortgage debt of the company
-
(8,550
)
Total debt and preferred equity (adjusted for joint venture
partners' share of debt) (C)
$
1,173,402
$
1,143,883
Total debt and preferred equity as a % of undepreciated real estate
assets (adjusted for joint venture partners' share of debt) (C÷A)
42.0
%
43.2
%
|