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8-K - FORM 8-K - Corporate Property Associates 17 - Global INC | y93408e8vk.htm |
Exhibit 99.1
Corporate Property Associates 17 Global Incorporated
Supplemental Information
Supplemental Information
As of September 30, 2011
As used in this supplemental package, the terms the Company, we, us and our include
Corporate Property Associates 17 Global Incorporated (CPA®:17 Global), its
consolidated subsidiaries and predecessors, unless otherwise indicated.
Important Note Regarding Non-GAAP Financial Measures
This supplemental package includes non-GAAP measures, including funds from operations (FFO),
modified funds from operations (MFFO), and adjusted cash flow from operating activities. A
description of these non-GAAP measures and reconciliations to the most directly comparable GAAP
measures are provided in this supplemental package.
Forward-Looking Statements
This supplemental package contains forward-looking statements within the meaning of the Federal
securities laws. It is important to note that our actual results could be materially different from
those projected in such forward-looking statements. You should exercise caution in relying on
forward-looking statements as they involve known and unknown risks, uncertainties and other factors
that may materially affect our future results, performance, achievements or transactions.
Information on factors which could impact actual results and forward-looking statements contained
herein is included in our filings with the Securities and Exchange Commission, including but not
limited to our Annual Report on Form 10-K for the year ended December 31, 2010. We do not undertake
to revise or update any forward-looking statements.
Executive Offices
|
Investor Relations | |
50 Rockefeller Plaza
|
Susan C. Hyde | |
New York, NY 10020
|
Managing Director & Director of Investor Relations | |
Tel: 1-800-WPCAREY or (212) 492-1100
|
W. P. Carey & Co. LLC | |
Fax: (212) 492-8922
|
Phone: (212) 492-1151 | |
Web Site Address: www.CPA17GLOBAL.com |
Corporate Property Associates 17 Global Incorporated
Reconciliation of Net Income Attributable to CPA®:17 Global Shareholders
to Modified Funds From Operations (MFFO) (Unaudited)
(in thousands, except share and per share amounts)
Reconciliation of Net Income Attributable to CPA®:17 Global Shareholders
to Modified Funds From Operations (MFFO) (Unaudited)
(in thousands, except share and per share amounts)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Net income attributable to CPA®:17 Global shareholders |
$ | 10,304 | $ | 8,713 | $ | 35,582 | $ | 21,491 | ||||||||
Adjustments: |
||||||||||||||||
Depreciation and amortization of real property |
11,367 | 3,721 | 28,197 | 9,309 | ||||||||||||
Gain on sale of real estate, net |
| (109 | ) | (787 | ) | (109 | ) | |||||||||
Proportionate share of adjustments to equity in net income of partially-owned entities to arrive at FFO: |
||||||||||||||||
Depreciation and amortization of real property |
4,476 | 783 | 9,740 | 2,330 | ||||||||||||
Loss on sale of real estate, net |
3 | | | 38 | ||||||||||||
Proportionate share of adjustments for noncontrolling
interests to arrive at FFO |
(164 | ) | (113 | ) | (490 | ) | (422 | ) | ||||||||
Total adjustments |
15,682 | 4,282 | 36,660 | 11,146 | ||||||||||||
FFO as defined by NAREIT (a) |
25,986 | 12,995 | 72,242 | 32,637 | ||||||||||||
Adjustments: |
||||||||||||||||
Other depreciation, amortization and non-cash charges |
(1,069 | ) | 14 | (624 | ) | 98 | ||||||||||
Straight-line and other rent adjustments (b) |
(3,410 | ) | (1,271 | ) | (9,537 | ) | (3,895 | ) | ||||||||
Acquisition expenses (c) |
2,346 | 379 | 6,374 | 1,570 | ||||||||||||
Above (below)-market rent intangible lease amortization, net (d) |
461 | 241 | 1,408 | 849 | ||||||||||||
Amortization of premiums on debt investments, net |
37 | 37 | 111 | 93 | ||||||||||||
Realized gains on foreign currency, derivatives and other |
(1,032 | ) | (497 | ) | (1,620 | ) | (751 | ) | ||||||||
Proportionate share of adjustments to equity in net income of partially-owned entities to arrive at MFFO: |
||||||||||||||||
Other depreciation, amortization and non-cash charges |
| (21 | ) | 1 | (21 | ) | ||||||||||
Straight-line and other rent adjustments (b) |
(55 | ) | (117 | ) | (239 | ) | (249 | ) | ||||||||
Acquisition expenses (c) |
64 | 1 | 170 | 1 | ||||||||||||
Above (below)-market rent intangible lease amortization, net
(d) |
(4 | ) | (2 | ) | 8 | (21 | ) | |||||||||
Realized losses (gains) on foreign currency, derivatives
and other |
1 | 1 | (4 | ) | 1 | |||||||||||
Proportionate share of adjustments for noncontrolling
interests to arrive at MFFO |
149 | 235 | 771 | 737 | ||||||||||||
Total adjustments |
(2,512 | ) | (1,000 | ) | (3,181 | ) | (1,588 | ) | ||||||||
MFFO |
$ | 23,474 | $ | 11,995 | $ | 69,061 | $ | 31,049 | ||||||||
MFFO per share |
$ | 0.15 | $ | 0.11 | $ | 0.47 | $ | 0.34 | ||||||||
Weighted average shares outstanding |
184,111,963 | 117,964,002 | 167,293,746 | 102,875,944 | ||||||||||||
MFFO per share calculation:
|
||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
MFFO |
$ | 23,474 | $ | 11,995 | $ | 69,061 | $ | 31,049 | ||||||||
Issuance of shares to an affiliate in satisfaction of fees due |
3,344 | 1,389 | 9,274 | 3,579 | ||||||||||||
MFFO numerator in determination of MFFO per share |
$ | 26,818 | $ | 13,384 | $ | 78,335 | $ | 34,628 | ||||||||
(a) | The SEC Staff has recently stated that they take no position on the inclusion or exclusion of impairment write-downs in arriving at FFO. Since 2003, the National Association of Real Estate Investment Trusts, Inc., or NAREIT, an industry trade group, has |
CPA®:17 Global 9/30/2011 Supplemental 8-K 2
taken the position that the exclusion of impairment charges is consistent with its definition of FFO. Accordingly, in future presentations we will revise our computation of FFO to exclude impairment charges, if any, in arriving at FFO. | ||
(b) | Under GAAP, rental receipts are allocated to periods using various methodologies. This may result in income recognition that is significantly different than underlying contract terms. By adjusting for these items (to reflect such payments from a GAAP accrual basis to a cash basis of disclosing the rent and lease payments), management believes that MFFO provides useful supplemental information on the realized economic impact of lease terms and debt investments, provides insight on the contractual cash flows of such lease terms and debt investments, and aligns results with managements analysis of operating performance. | |
(c) | In evaluating investments in real estate, management differentiates the costs to acquire the investment from the operations derived from the investment. Such information would be comparable only for non-listed REITs that have completed their acquisition activity and have other similar operating characteristics. By excluding expensed acquisition costs, management believes MFFO provides useful supplemental information that is comparable for each type of real estate investment and is consistent with managements analysis of the investing and operating performance of our properties. Acquisition fees and expenses include payments to our advisor or third parties. Acquisition fees and expenses under GAAP are considered operating expenses and as expenses included in the determination of net income and income from continuing operations, both of which are performance measures under GAAP. All paid and accrued acquisition fees and expenses will have negative effects on returns to shareholders, the potential for future distributions, and cash flows generated by us, unless earnings from operations or net sales proceeds from the disposition of properties are generated to cover the purchase price of the property, these fees and expenses and other costs related to the property. | |
(d) | Under GAAP, certain intangibles are accounted for at cost and reviewed at least annually for impairment, and certain intangibles are assumed to diminish predictably in value over time and amortized, similar to depreciation and amortization of other real estate related assets that are excluded from FFO. However, because real estate values and market lease rates historically rise or fall with market conditions, management believes that by excluding charges relating to amortization of these intangibles, MFFO provides useful supplemental information on the performance of the real estate. |
Non-GAAP Financial Disclosure
Funds from Operations (FFO) and Modified Funds from Operations (MFFO)
Due to certain unique operating characteristics of real estate companies, as discussed below,
NAREIT has promulgated a measure known as funds from operations, or FFO, which we believe to be an
appropriate supplemental measure to reflect the operating performance of a real estate investment
trust, or REIT. The use of FFO is recommended by the REIT industry as a supplemental performance
measure. FFO is not equivalent to nor a substitute for net income or loss as determined under GAAP.
We define FFO, a non-GAAP measure, consistent with the standards established by the White Paper on
FFO approved by the Board of Governors of NAREIT, as revised in February 2004, or the White Paper.
The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding gains
or losses from sales of property but including asset impairment writedowns, plus depreciation and
amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments
for unconsolidated partnerships and joint ventures are calculated to reflect FFO. Our FFO
calculation complies with NAREITs policy described above.
The historical accounting convention used for real estate assets requires straight-line
depreciation of buildings and improvements, which implies that the value of real estate assets
diminishes predictably over time, especially if such assets are not adequately maintained or
repaired and renovated as required by relevant circumstances and/or is requested or required by
lessees for operational purposes in order to maintain the value disclosed. We believe that, since
real estate values historically rise and fall with market conditions, including inflation, interest
rates, the business cycle, unemployment and consumer spending, presentations of operating results
for a REIT using historical accounting for depreciation may be less informative. Historical
accounting for real estate involves the use of GAAP. Any other method of accounting for real estate
such as the fair value method cannot be construed to be any more accurate or relevant than the
comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the
use of FFO, which excludes the impact of real estate related depreciation and amortization,
provides a more complete understanding of our performance to investors and to management, and when
compared year over year, reflects the impact on our operations from trends in occupancy rates,
rental rates, operating costs, general and administrative expenses, and interest costs, which may
not be immediately apparent from net income. However, FFO and MFFO, as described below, should not
be construed to be more relevant or accurate than the current GAAP methodology in calculating net
income or in its applicability in evaluating the operating performance of the company. The method
utilized to evaluate the value and performance of real estate under GAAP should be construed as a
more relevant measure of operational performance and considered more prominently than the non-GAAP
FFO and MFFO measures and the adjustments to GAAP in calculating FFO and MFFO.
Changes in the accounting and reporting promulgations under GAAP (for acquisition fees and expenses
from a capitalization/depreciation model to an expensed-as-incurred model) were put into effect in
2009. These other changes to GAAP
CPA®:17 Global 9/30/2011 Supplemental 8-K 3
accounting for real estate subsequent to the establishment of NAREITs definition of FFO have
prompted an increase in cash-settled expenses, specifically acquisition fees and expenses for all
industries as items that are expensed under GAAP, that are typically accounted for as operating
expenses. Management believes these fees and expenses do not affect our overall long-term operating
performance. Publicly registered, non-listed REITs typically have a significant amount of
acquisition activity and are substantially more dynamic during their initial years of investment
and operation. While other start-up entities may also experience significant acquisition activity
during their initial years, we believe that non-listed REITs are unique in that they have a limited
life with targeted exit strategies within a relatively limited time frame after acquisition
activity ceases. As disclosed in the prospectus for our follow-on offering dated April 7, 2011 (the
Prospectus), we intend to begin the process of achieving a liquidity event (i.e., listing of our
common stock on a national exchange, a merger or sale of our assets or another similar transaction)
within eight to 12 years following the investment of substantially all of the net proceeds from our
initial public offering, which was terminated in April 2011. Thus, we do not intend to continuously
purchase assets and intend to have a limited life. Due to the above factors and other unique
features of publicly registered, non-listed REITs, the Investment Program Association (IPA), an
industry trade group, has standardized a measure known as MFFO, which the IPA has recommended as a
supplemental measure for publicly registered non-listed REITs and which we believe to be another
appropriate supplemental measure to reflect the operating performance of a non-listed REIT having
the characteristics described above. MFFO is not equivalent to our net income or loss as determined
under GAAP, and MFFO may not be a useful measure of the impact of long-term operating performance
on value if we do not continue to operate with a limited life and targeted exit strategy, as
currently intended. We believe that, because MFFO excludes costs that we consider more reflective
of investing activities and other non-operating items included in FFO and also excludes acquisition
fees and expenses that affect our operations only in periods in which properties are acquired, MFFO
can provide, on a going forward basis, an indication of the sustainability (that is, the capacity
to continue to be maintained) of our operating performance after the period in which we are
acquiring properties and once our portfolio is in place. By providing MFFO, we believe we are
presenting useful information that assists investors and analysts to better assess the
sustainability of our operating performance after our offering has been completed and once all of
our properties have been acquired. We also believe that MFFO is a recognized measure of sustainable
operating performance by the non-listed REIT industry. Further, we believe MFFO is useful in
comparing the sustainability of our operating performance after our offering and most of our
acquisitions are completed with the sustainability of the operating performance of other real
estate companies that are not as involved in acquisition activities. Investors are cautioned that
MFFO should only be used to assess the sustainability of a companys operating performance after a
companys offering has been completed and properties have been acquired, as it excludes acquisition
costs that have a negative effect on a companys operating performance during the periods in which
properties are acquired.
We define MFFO, a non-GAAP measure, consistent with the IPAs Guideline 2010-01, Supplemental
Performance Measure for Publicly Registered, Non-Listed REITs: Modified Funds from Operations, or
the Practice Guideline, issued by the IPA in November 2010. The Practice Guideline defines MFFO as
FFO further adjusted for the following items, as applicable, included in the determination of GAAP
net income: acquisition fees and expenses; amounts relating to deferred rent receivables and
amortization of above and below market leases and liabilities (which are adjusted in order to
reflect such payments from a GAAP accrual basis to a cash basis of disclosing the rent and lease
payments); accretion of discounts and amortization of premiums on debt investments; nonrecurring
impairments of real estate-related investments (i.e., infrequent or unusual, not reasonably likely
to recur in the ordinary course of business); mark-to-market adjustments included in net income;
nonrecurring gains or losses included in net income from the extinguishment or sale of debt,
hedges, foreign exchange, derivatives or securities holdings where trading of such holdings is not
a fundamental attribute of the business plan, unrealized gains or losses resulting from
consolidation from, or deconsolidation to, equity accounting, and after adjustments for
consolidated and unconsolidated partnerships and joint ventures, with such adjustments calculated
to reflect MFFO on the same basis. The accretion of discounts and amortization of premiums on debt
investments, nonrecurring unrealized gains and losses on hedges, foreign exchange, derivatives or
securities holdings, unrealized gains and losses resulting from consolidations, as well as other
listed cash flow adjustments are adjustments made to net income in calculating the cash flows
provided by operating activities and, in some cases, reflect gains or losses which are unrealized
and may not ultimately be realized. While we are responsible for managing interest rate, hedge and
foreign exchange risk, we retain an outside consultant to review all our hedging agreements.
Inasmuch as interest rate hedges are not a fundamental part of our operations, we believe it is
appropriate to exclude such infrequent gains and losses in calculating MFFO, as such gains and
losses are not reflective of on-going operations.
Our MFFO calculation complies with the IPAs Practice Guideline described above. In calculating
MFFO, we exclude acquisition-related expenses, amortization of above- and below-market leases, fair
value adjustments of derivative financial instruments, deferred rent receivables and the
adjustments of such items related to noncontrolling interests. Under GAAP, acquisition fees and
expenses are characterized as operating expenses in determining operating net income. These
expenses are paid in cash by a company. All paid and accrued acquisition fees and expenses will
have negative effects on returns to investors, the potential for future distributions, and cash
flows generated by the company, unless earnings from operations or net sales proceeds from the
disposition of other properties are generated to cover the purchase price of the property, these
fees and expenses and other costs related to such property. Further, under GAAP, certain
contemplated non-cash fair value and other non-cash adjustments are considered operating non-cash
adjustments to net income in determining cash flow from operating activities. In addition, we view
fair value adjustments of derivatives, impairment charges and gains and losses from dispositions of
assets as infrequent items or items which are unrealized and may not ultimately be
CPA®:17 Global 9/30/2011 Supplemental 8-K 4
realized, and which are not reflective of on-going operations and are therefore typically adjusted
for assessing operating performance. In particular, we believe it is appropriate to disregard
impairment charges, as this is a fair value adjustment that is largely based on market fluctuations
and assessments regarding general market conditions which can change over time. An asset will only
be evaluated for impairment if certain impairment indications exist and if the carrying, or book
value, exceeds the total estimated undiscounted future cash flows (including net rental and lease
revenues, net proceeds on the sale of the property, and any other ancillary cash flows at a
property or group level under GAAP) from such asset. Investors should note, however, that
determinations of whether impairment charges have been incurred are based partly on anticipated
operating performance, because estimated undiscounted future cash flows from a property, including
estimated future net rental and lease revenues, net proceeds on the sale of the property, and
certain other ancillary cash flows, are taken into account in determining whether an impairment
charge has been incurred. While impairment charges are excluded from the calculation of MFFO as
described above, investors are cautioned that, due to the fact that impairments are based on
estimated future undiscounted cash flows and the relatively limited term of our operations, it
could be difficult to recover any impairment charges.
Our management uses MFFO and the adjustments used to calculate it in order to evaluate our
performance against other non-listed REITs which have limited lives with short and defined
acquisition periods and targeted exit strategies shortly thereafter. As noted above, MFFO may not
be a useful measure of the impact of long-term operating performance on value if we do not continue
to operate in this manner. We believe that our use of MFFO and the adjustments used to calculate it
allow us to present our performance in a manner that reflects certain characteristics that are
unique to non-listed REITs, such as their limited life, limited and defined acquisition period and
targeted exit strategy, and hence that the use of such measures is useful to investors. For
example, acquisition costs are generally funded from the proceeds of our offering and other
financing sources and not from operations. By excluding expensed acquisition costs, the use of MFFO
provides information consistent with managements analysis of the operating performance of the
properties. Additionally, fair value adjustments, which are based on the impact of current market
fluctuations and underlying assessments of general market conditions, but can also result from
operational factors such as rental and occupancy rates, may not be directly related or attributable
to our current operating performance. By excluding such changes that may reflect anticipated and
unrealized gains or losses, we believe MFFO provides useful supplemental information.
Presentation of this information is intended to provide useful information to investors as they
compare the operating performance of different REITs, although it should be noted that not all
REITs calculate FFO and MFFO the same way, so comparisons with other REITs may not be meaningful.
Furthermore, FFO and MFFO are not necessarily indicative of cash flow available to fund cash needs
and should not be considered as an alternative to net income (loss) or income (loss) from
continuing operations as an indication of our performance, as an alternative to cash flows from
operations as an indication of our liquidity, or indicative of funds available to fund our cash
needs including our ability to make distributions to our stockholders. FFO and MFFO should be
reviewed in conjunction with other GAAP measurements as an indication of our performance.
MFFO has limitations as a performance measure in an offering such as ours, where the price of a
share of common stock is a stated value and there is no net asset value determination during the
offering stage and for a period thereafter. MFFO is useful in assisting management and investors in
assessing the sustainability of operating performance in future operating periods, and in
particular, after the offering and acquisition stages are complete and net asset value is
disclosed. MFFO is not a useful measure in evaluating net asset value because impairments are taken
into account in determining net asset value but not in determining MFFO.
Neither the SEC, NAREIT nor any other regulatory body has passed judgment on the acceptability of
the adjustments that we use to calculate FFO or MFFO. In the future, the SEC, NAREIT or another
regulatory body may decide to standardize the allowable adjustments across the non-listed REIT
industry and we would have to adjust our calculation and characterization of FFO or MFFO
accordingly.
CPA®:17 Global 9/30/2011 Supplemental 8-K 5
Corporate Property Associates 17 Global Incorporated
Adjusted Cash Flow from Operating Activities (Unaudited)
(in thousands, except share and per share amounts)
Adjusted Cash Flow from Operating Activities (Unaudited)
(in thousands, except share and per share amounts)
Nine Months Ended September 30, | ||||||||
2011 | 2010 | |||||||
Cash flow provided by operating activities |
$ | 71,237 | $ | 45,627 | ||||
Adjustments: |
||||||||
Distributions received from equity investments in real estate in excess of equity income, net (a) |
11,743 | 1,650 | ||||||
Distributions paid to noncontrolling interests, net (b) |
(14,040 | ) | (9,402 | ) | ||||
Changes in working capital (c) |
3,197 | (3,196 | ) | |||||
Adjusted cash flow from operating activities (d) |
$ | 72,137 | $ | 34,679 | ||||
Adjusted cash flow per share |
$ | 0.43 | $ | 0.34 | ||||
Distributions declared per share |
$ | 0.4850 | $ | 0.4800 | ||||
Payout ratio (distributions per share/adjusted cash flow per share) |
113 | % | 141 | % | ||||
Weighted average shares outstanding |
167,293,746 | 102,875,944 | ||||||
(a) | To the extent we receive distributions in excess of equity income that we recognize, we include such amounts in our evaluation of cash flow from core operations. | |
(b) | Represents noncontrolling interests share of distributions made by ventures that we consolidate in our financial statements. | |
(c) | Timing differences arising from the payment of certain liabilities and the receipt of certain receivables in a period other than that in which the item is recognized in determining net income may distort the actual cash flow that our core operations generate. We adjust our GAAP cash flow provided by operating activities to record such amounts in the period in which the item was actually recognized. | |
(d) | During the first quarter of 2011, we made an adjustment to exclude the impact of escrow funds from Adjusted cash flow from operating activities as, more often than not, these funds represent investing and/or financing activities. The amount previously furnished for Adjusted cash flow from operating activities for the nine months ended September 30, 2010 of $32.6 million has been revised in the table above to reflect this reclassification. |
Non-GAAP Financial Disclosure
Adjusted cash flow from operating activities refers to our cash flow from operating activities (as
computed in accordance with GAAP) adjusted, where applicable, primarily to: add cash distributions
that we receive from our investments in unconsolidated real estate joint ventures in excess of our
equity income; subtract cash distributions that we make to our noncontrolling partners in real
estate joint ventures that we consolidate; and eliminate changes in working capital. We hold a
number of interests in real estate joint ventures, and we believe that adjusting our GAAP cash flow
provided by operating activities to reflect these actual cash receipts and cash payments, as well
as eliminating the effect of timing differences between the payment of certain liabilities and the
receipt of certain receivables in a period other than that in which the item is recognized may give
investors additional information about our actual cash flow that is not incorporated in cash flow
from operating activities as defined by GAAP.
We believe that adjusted cash flow from operating activities is a useful supplemental measure for
assessing the cash flow generated from our core operations as it gives investors important
information about our liquidity that is not provided within cash flow from operating activities as
defined by GAAP, and we use this measure when evaluating distributions to shareholders. Adjusted
cash flow from operating activities should not be considered as an alternative to cash provided by
operating activities computed on a GAAP basis as a measure of our liquidity. As we are still in our
offering and investment stage, we also consider our expectations as to the yields that may be
generated on existing investments and our acquisition pipeline when evaluating distributions to
shareholders.
CPA®:17 Global 9/30/2011 Supplemental 8-K 6
Corporate Property Associates 17 Global Incorporated
Portfolio Diversification as of September 30, 2011 (Unaudited)
Top Ten Tenants by Rent (Pro Rata Basis)
(in thousands)
Portfolio Diversification as of September 30, 2011 (Unaudited)
Top Ten Tenants by Rent (Pro Rata Basis)
(in thousands)
Annualized Contractual | ||||||||
Tenant/Lease Guarantor | Minimum Base Rent | Percent | ||||||
Metro AG(a) |
$ | 26,889 | 12 | % | ||||
General Parts Inc. (Carquest) (a) |
17,472 | 8 | % | |||||
Agrokor d.d. (a) |
15,723 | 7 | % | |||||
A-American Self Storage |
14,908 | 7 | % | |||||
The New York Times Company |
13,705 | 6 | % | |||||
C1000 BV (a) |
12,980 | 6 | % | |||||
Hellweg Die Profi-Baumärkte GmbH & Co KG (a) |
11,922 | 5 | % | |||||
Eroski Sociedad Cooperativa (a) |
11,324 | 5 | % | |||||
DTS Distribuidora de Television Digital SA (a) |
8,975 | 4 | % | |||||
Terminal Freezers, LLC |
8,395 | 4 | % | |||||
Total |
$ | 142,293 | 64 | % | ||||
Weighted Average Lease Term for Portfolio: |
15.7 years |
(a) | Rent amounts are subject to fluctuations in foreign currency exchange rates. |
Portfolio
At September 30, 2011, our portfolio was comprised of our full or partial ownership interests in
301 fully-occupied properties, substantially all of which were triple-net leased to 45 tenants, and
totaled approximately 25 million square feet (on a pro rata basis). In addition, we own 35
self-storage properties and retain a fee interest in a hotel property for an aggregate of
approximately 3 million square feet (on a pro rata basis).
CPA®:17 Global 9/30/2011 Supplemental 8-K 7
Corporate Property Associates 17 Global Incorporated
Portfolio Diversification as of September 30, 2011 (Unaudited)
by Geography and Property Type (Pro Rata Basis)
(in thousands)
Portfolio Diversification as of September 30, 2011 (Unaudited)
by Geography and Property Type (Pro Rata Basis)
(in thousands)
Annualized Contractual | ||||||||
Region | Minimum Base Rent | Percent | ||||||
U.S. |
||||||||
West |
$ | 32,357 | 15 | % | ||||
East |
30,007 | 13 | % | |||||
Midwest |
28,691 | 13 | % | |||||
South |
26,093 | 12 | % | |||||
U.S. Total |
117,148 | 53 | % | |||||
International |
||||||||
Italy |
26,889 | 12 | % | |||||
Spain |
20,298 | 9 | % | |||||
Germany |
17,212 | 8 | % | |||||
Croatia |
15,723 | 7 | % | |||||
Netherlands |
12,980 | 6 | % | |||||
United Kingdom |
5,440 | 2 | % | |||||
Hungary |
3,529 | 2 | % | |||||
Poland |
1,154 | 1 | % | |||||
International Total |
103,225 | 47 | % | |||||
Total |
$ | 220,373 | 100 | % | ||||
Annualized Contractual | ||||||||
Property Type | Minimum Base Rent | Percent | ||||||
Warehouse/Distribution |
$ | 72,432 | 33 | % | ||||
Retail |
60,881 | 27 | % | |||||
Office |
39,352 | 18 | % | |||||
Industrial |
24,891 | 11 | % | |||||
Self Storage |
19,228 | 9 | % | |||||
Other (a) |
3,589 | 2 | % | |||||
Total |
$ | 220,373 | 100 | % | ||||
(a) | Includes rent from tenants with the following property types: education (1%), hospitality (1%) and residential (0.01%). |
Portfolio Diversification by Geography
|
Portfolio Diversification by Property Type | |
CPA®:17 Global 9/30/2011 Supplemental 8-K 8
Corporate Property Associates 17 Global Incorporated
Portfolio Diversification as of September 30, 2011 (Unaudited)
by Tenant Industry (Pro Rata Basis)
(in thousands)
Portfolio Diversification as of September 30, 2011 (Unaudited)
by Tenant Industry (Pro Rata Basis)
(in thousands)
Annualized Contractual | |||||||||
Industry Type (a) | Minimum Base Rent | Percent | |||||||
Retail Trade |
$ | 62,674 | 29 | % | |||||
Grocery |
43,555 | 20 | % | ||||||
Media: Printing and Publishing |
22,680 | 10 | % | ||||||
Buildings and Real Estate |
17,915 | 8 | % | ||||||
Transportation Cargo |
11,630 | 5 | % | ||||||
Machinery |
8,751 | 4 | % | ||||||
Chemicals, Plastics, Rubber, and Glass |
6,614 | 3 | % | ||||||
Electronics |
6,531 | 3 | % | ||||||
Healthcare, Education and Childcare |
6,197 | 3 | % | ||||||
Leisure, Amusement, Entertainment |
5,887 | 3 | % | ||||||
Consumer Services |
5,197 | 2 | % | ||||||
Business and Commercial Services |
4,000 | 2 | % | ||||||
Banking |
3,821 | 2 | % | ||||||
Transportation Personal |
3,517 | 2 | % | ||||||
Beverages, Food, and Tobacco |
3,193 | 1 | % | ||||||
Textiles, Leather, and Apparel |
2,887 | 1 | % | ||||||
Automobile |
2,329 | 1 | % | ||||||
Other (b) |
2,995 | 1 | % | ||||||
Total |
$ | 220,373 | 100 | % | |||||
(a) | Based on the Moodys Investors Service, Inc. classification system and information provided by the tenant. | |
(b) | Includes tenants in hotels and gaming (0.7%), forest products and paper (0.4%), consumer and durable goods (0.2%) and mining, metals, and primary metal industries (0.1%). |
CPA®:17 Global 9/30/2011 Supplemental 8-K 9
CORPORATE PROPERTY ASSOCIATES 17 GLOBAL INCORPORATED
2011 Investment Activity
As of September 30, 2011
(in thousands, except square footage)
2011 Investment Activity
As of September 30, 2011
(in thousands, except square footage)
Acquisitions
Tenant/Lease Guarantor | Property Location(s) | Purchase Price (a) | Closing Date | Property Type | Gross Square Footage | |||||||||||||
Terminal Freezers, LLC |
Oxnard & Watsonville, CA | $ | 99,634 | January-11 | Warehouse/Distribution | 866,525 | ||||||||||||
C1000 Logistiek Vastgoed B.V. (b) (c) |
Various locations in The Netherlands | 207,635 | January-11 | Warehouse/Distribution | 2,046,858 | |||||||||||||
Harbor Freight Tools USA, Inc. |
Dillon, SC | 32,060 | March-11 | Warehouse/Distribution | 1,010,859 | |||||||||||||
Dolgencorp, LLC (d) |
Richwood, LA; Vass, NC & Hot Springs, VA | 2,893 | March-11 | Retail | BTS | |||||||||||||
Curtiss-Wright Flow Control Service |
Middleburg Heights, OH | 2,585 | March-11 | Industrial | 28,185 | |||||||||||||
Flanders Corporation |
Ardmore, OK; Smithfield, NC; Bartow, FL & Momence, IL | 50,790 | April-11 | Warehouse/Distribution | 722,108 | |||||||||||||
Berry Plastics Corporation |
Evansville, IN | 2,723 | April-11 April-11; May-11 & |
Industrial | 263,088 | |||||||||||||
Dolgencorp, LLC (d) |
Hopewell & Chesterfield, VA; Mount Hermon & Mangham, LA | 4,311 | June-11 | Retail | BTS | |||||||||||||
ICF International, Inc. (d) |
Martinsville, VA | 14,819 | May-11 | Office | BTS | |||||||||||||
CRO San Luis Development, LLC |
Chicago, IL | 7,414 | June-11 | Retail | 17,000 | |||||||||||||
Dolgencorp, LLC (d) |
Choudrant, LA | 882 | July-11 | Retail | BTS | |||||||||||||
Precision Printing and Packing, Inc. |
Clarksville, TN | 7,960 | August-11 | Industrial | 189,300 | |||||||||||||
Dolgencorp, LLC (d) |
Gardner, LA | 979 | August-11 | Retail | BTS | |||||||||||||
Faurecia International System, Inc. (d) |
Fraser, MI | 6,775 | September-11 | Industrial | BTS | |||||||||||||
Metro AG (b) |
Various locations in Italy | 395,511 | September-11 | Retail | 2,415,163 | |||||||||||||
Total Acquisitions Leased Properties |
836,971 | 7,559,086 | ||||||||||||||||
Property Type | Property Location(s) | Purchase Price | Closing Date | |||||||||||||||
Self-Storage Facility |
Fort Worth, TX | 3,400 | April-11 | |||||||||||||||
Self-Storage Facilities |
Various locations in California, Hawaii and Illinois | 86,015 | June-11 | |||||||||||||||
Self-Storage Facility |
Kihei, HI | 11,069 | August-11 | |||||||||||||||
Self-Storage Facilities |
Various locations in California and Illinois | 20,292 | August-11 | |||||||||||||||
Self-Storage Facility |
Pearl City, HI | 6,064 | August-11 | |||||||||||||||
Self-Storage Facilities |
Various locations in California and Illinois | 8,428 | September-11 | |||||||||||||||
Self-Storage Facility |
Chicago, IL | 7,891 | September-11 | |||||||||||||||
Total Acquisitions Hospitality/Self Storage Properties | 143,159 | |||||||||||||||||
Notes Receivable | ||||||||||||||||||
Borrower/Guarantor | Interest Rate | Note Amount | Closing Date | Maturity Date | ||||||||||||||
BPS Partners |
8.00% | 30,000 | June-11 | June-16 | ||||||||||||||
Total Acquisitions |
$ | 1,010,130 | ||||||||||||||||
(a) | Includes capitalized transaction costs, where applicable. | |
(b) | Acquisition price reflects applicable foreign exchange rate. | |
(c) | Property is jointly owned by CPA®:15 (15% ownership interest) and CPA®:17 Global (85% ownership interest). | |
(d) | Acquisition includes a build-to-suit (BTS) transaction. Gross square footage cannot be determined at this time. |
CPA®:17 Global 9/30/2011 Supplemental 8-K 10
Dispositions
Disposition | ||||||||||||||||||||
Tenant/Lease Guarantor | Property Location(s) | Gross Sale Price | Date | Property Type | Gross Square Footage | |||||||||||||||
Carquest Canada Ltd. (a) |
New Brunswick and Quebec, Canada | $ | 19,773 | June-11 | Warehouse/Distribution | 231,870 | ||||||||||||||
Total Dispositions |
$ | 19,773 | 231,870 | |||||||||||||||||
(a) | Disposition price reflects applicable foreign exchange rate. |
CPA®:17 Global 9/30/2011 Supplemental 8-K 11