Attached files
| file | filename |
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| 8-K - FORM 8-K MAIN BODY - CENTERLINE HOLDING CO | f8k_may2012-clnh.htm |
| EX-99.1 - EXHIBIT 99.1 - CENTERLINE HOLDING CO | exhibit_99-1.htm |
Centerline Holding Company
Financial Overview
1Q12 | March 31, 2012
CENTERLINE CAPITAL GROUP
Table of Contents
Centerline Corporate Overview pg 3
Equity Ownership Summary pg 7
Supplemental Financial Information pg 9
Glossary pg 19
Corporate Office
100 Church Street, 15th Floor
New York, NY 10007
Phone: 212-317-5700
Fax: 212-588-2010
www.centerline.com
OTC Symbol: CLNH
Investor Contacts
Michael Larsen
CFO and Treasurer
212-317-5727
Denise Bernstein
Investor Relations
212-521-6451
Centerline Corporate Overview pg 3
Equity Ownership Summary pg 7
Supplemental Financial Information pg 9
Glossary pg 19
Corporate Office
100 Church Street, 15th Floor
New York, NY 10007
Phone: 212-317-5700
Fax: 212-588-2010
www.centerline.com
OTC Symbol: CLNH
Investor Contacts
Michael Larsen
CFO and Treasurer
212-317-5727
Denise Bernstein
Investor Relations
212-521-6451
This presentation contains forward-looking statements about
Centerline Holding Company. Certain statements in this document
may constitute forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Except for historical information, the matters
discussed in this presentation are forward-looking statements
subject to certain risks and uncertainties. These statements are
based on management's current expectations and beliefs and are
subject to a number of factors and uncertainties that could cause
actual results to differ materially from those described in the
forward-looking statements. These risks and uncertainties are
detailed in Centerline Holding Company's most recent Annual
Report on Form 10-K filed with the Securities and Exchange
Commission, and include, among others, business limitations
caused by adverse changes in real estate and credit markets and
general economic and business conditions; our ability to generate
new income sources, raise capital for investment funds and
maintain business relationships with providers and users of capital;
changes in applicable laws and regulations; our tax treatment, the
tax treatment of our subsidiaries and the tax treatment of our
investments; risk of allocations of income to our shareholders
without corresponding cash distributions; possible adverse effects
of a future issuance of shares or a reverse share split; possible
deterioration in cash flows generated by material investments, such
as the Freddie Mac B-Certificate; competition with other
companies; risk of loss under mortgage banking loss sharing
agreements; and risks associated with providing credit
intermediation. Words such as "anticipates", "expects", "intends",
"plans", "believes", "seeks", "estimates" and similar expressions are
intended to identify forward-looking statements. Such forward-
looking statements speak only as of the date of this document.
Centerline Holding Company expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change
in Centerline Holding Company's expectations with regard thereto
or change in events, conditions, or circumstances on which any
such statement is based.
Centerline Holding Company. Certain statements in this document
may constitute forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Except for historical information, the matters
discussed in this presentation are forward-looking statements
subject to certain risks and uncertainties. These statements are
based on management's current expectations and beliefs and are
subject to a number of factors and uncertainties that could cause
actual results to differ materially from those described in the
forward-looking statements. These risks and uncertainties are
detailed in Centerline Holding Company's most recent Annual
Report on Form 10-K filed with the Securities and Exchange
Commission, and include, among others, business limitations
caused by adverse changes in real estate and credit markets and
general economic and business conditions; our ability to generate
new income sources, raise capital for investment funds and
maintain business relationships with providers and users of capital;
changes in applicable laws and regulations; our tax treatment, the
tax treatment of our subsidiaries and the tax treatment of our
investments; risk of allocations of income to our shareholders
without corresponding cash distributions; possible adverse effects
of a future issuance of shares or a reverse share split; possible
deterioration in cash flows generated by material investments, such
as the Freddie Mac B-Certificate; competition with other
companies; risk of loss under mortgage banking loss sharing
agreements; and risks associated with providing credit
intermediation. Words such as "anticipates", "expects", "intends",
"plans", "believes", "seeks", "estimates" and similar expressions are
intended to identify forward-looking statements. Such forward-
looking statements speak only as of the date of this document.
Centerline Holding Company expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change
in Centerline Holding Company's expectations with regard thereto
or change in events, conditions, or circumstances on which any
such statement is based.
CENTERLINE CAPITAL GROUP
Centerline Corporate Overview
4
Corporate Overview
Centerline Capital Group (“Centerline”), a subsidiary of Centerline Holding Company (OTC:CLNH), provides real estate
financing and asset management services, focused on affordable and conventional multifamily housing. We offer a range of
both debt financing, equity investment products, and asset management services to developers, owners and investors.
financing and asset management services, focused on affordable and conventional multifamily housing. We offer a range of
both debt financing, equity investment products, and asset management services to developers, owners and investors.
Our core businesses include:
• Low-Income Housing Tax Credit (“LIHTC”) syndication, fund management, asset and portfolio management,
and affordable debt
and affordable debt
• Affordable and conventional multifamily lending, primarily as a Fannie Mae DUS lender, Freddie Mac seller-servicer,
and FHA-approved mortgage provider
and FHA-approved mortgage provider
Centerline, or its predecessor companies, has been in continuous operation since 1972.
Affordable Housing and Asset Management
• Centerline has been a leader in the affordable housing industry since creation of the LIHTC program in 1986. We have raised
over $10.0 billion in equity from institutional and retail investors as a sponsor of 136 public and private real estate investment
funds.
over $10.0 billion in equity from institutional and retail investors as a sponsor of 136 public and private real estate investment
funds.
• Today, we manage $9.3 billion of investor equity within 116 funds.
• Centerline has invested in over 1,200 affordable multifamily rental assets in 45 U.S. states, Washington DC and Puerto Rico.
Mortgage Banking and Affordable Housing Debt
• We started in the agency mortgage loan industry in 1988; our current agency mortgage loan portfolio stands at about $9
billion.
billion.
• Since 1988 we have originated over $8 billion in Fannie Mae loans, and we have originated over $2.7 billion in Freddie Mac
loans since 1996.
loans since 1996.
MORTGAGE BANKING
We provide mortgage financing for conventional
multifamily properties across the United States.
Centerline originates loans for multifamily properties,
manufactured housing and student housing, as well as
bridge loans for multifamily properties that meet GSE
criteria. We also have the capability to provide small
loans, and non-agency financing executions on
multifamily assets.
multifamily properties across the United States.
Centerline originates loans for multifamily properties,
manufactured housing and student housing, as well as
bridge loans for multifamily properties that meet GSE
criteria. We also have the capability to provide small
loans, and non-agency financing executions on
multifamily assets.
ASSET MANAGEMENT
We monitor and manage a growing portfolio of
multifamily real estate assets comprising 147,000 units.
We manage properties for our investors’ proprietary and
multi-investor funds, as well as Centerline’s own
portfolio. Our primary goal is to avoid, mitigate and
manage risk for the assets we oversee while
maximizing returns to our investors. We work closely
with our developer partners, property management
firms and other service providers ensuring we meet our
goals.
multifamily real estate assets comprising 147,000 units.
We manage properties for our investors’ proprietary and
multi-investor funds, as well as Centerline’s own
portfolio. Our primary goal is to avoid, mitigate and
manage risk for the assets we oversee while
maximizing returns to our investors. We work closely
with our developer partners, property management
firms and other service providers ensuring we meet our
goals.
5
Business Groups
AFFORDABLE HOUSING DEBT
We offer a broad range of financing options and deal
structuring expertise to developers, owners, and
managers of affordable housing communities.
Centerline uses its Fannie Mae DUS license, Freddie
Mac relationship, FHA MAP designation along with
other strategic partnerships to provide alternatives for
all forms of affordable housing debt needs including: tax
-exempt bonds, taxable financings, forward
commitments, moderate and substantial rehabilitation,
bridge loans, and preservation transactions.
structuring expertise to developers, owners, and
managers of affordable housing communities.
Centerline uses its Fannie Mae DUS license, Freddie
Mac relationship, FHA MAP designation along with
other strategic partnerships to provide alternatives for
all forms of affordable housing debt needs including: tax
-exempt bonds, taxable financings, forward
commitments, moderate and substantial rehabilitation,
bridge loans, and preservation transactions.
AFFORDABLE HOUSING EQUITY
We invest capital raised from institutional investors as
equity in affordable housing tax credit developments.
We structure, market and manage new tax credit funds,
originate affordable housing equity investments
nationwide, and offer disposition and refinancing
services to maximize asset value. Centerline raises
equity capital from a range of banks, insurance
companies and corporate investors. We invest this
capital in properties developed by national and local
real estate developers.
equity in affordable housing tax credit developments.
We structure, market and manage new tax credit funds,
originate affordable housing equity investments
nationwide, and offer disposition and refinancing
services to maximize asset value. Centerline raises
equity capital from a range of banks, insurance
companies and corporate investors. We invest this
capital in properties developed by national and local
real estate developers.
6
Competitive Advantages
EXPERTISE.
•We have a 40-year track record of continuous operation through various real estate and economic cycles.
•We originate, underwrite, service, asset manage, refinance or sell assets through all phases of their life cycles.
•We are an industry leader in affordable and multifamily housing finance.
RELATIONSHIPS.
•We have direct relationships with real estate developers and owners.
•We have strategic relationships with GSEs, banks, insurance companies and other institutional investors.
SOLUTIONS.
•We offer a broad spectrum of financing and investment products tailored to meet specific client goals.
•We have a depth and breadth of asset management and originations services.
•We mitigate and manage risk to ensure the best possible returns on investments.
CENTERLINE CAPITAL GROUP
Equity Ownership Summary
8
Equity Ownership as of March 31, 2012
(1) The FDIC, in its capacity as Receiver, is the record owner of common shares on behalf of the following entities: California National Bank, California Savings Bank, San Diego National Bank, Indy Mac Bank, F.S.B., North
Houston Bank, and Community Bank & Trust.
Houston Bank, and Community Bank & Trust.
(2) Shareholders are subject to Lock-Up Agreements pursuant to which they may not offer, sell, offer to sell, contract to sell, grant and option to purchase or otherwise sell or dispose of any of their Centerline equity interests.
(1)
(2)
(2)
(2)
(2)
CENTERLINE CAPITAL GROUP
Supplemental Financial Statements
The accompanying “As Adjusted” balance sheets and statements of operations are not in accordance with
GAAP, are presented for the purpose of enhancing the understanding of the economics of our business, and may
not be comparable to figures reported by other companies.
GAAP, are presented for the purpose of enhancing the understanding of the economics of our business, and may
not be comparable to figures reported by other companies.
(1) Adjusted to exclude Consolidated Partnerships, mortgage revenue bonds re-securitized in December 2007, Credit Risk Products and Equity Issuer Trust. Refer to Page
15 for further details.
15 for further details.
11
As Adjusted Balance Sheet
Asset Detail
12
As Adjusted Balance Sheet (cont.)
Liability Detail
13
Q1 2012 As Adjusted Income Statement
Revenue & Equity Income Detail
15
(1) Adjusted to exclude Consolidated Partnerships, mortgage revenue bonds re-securitized in December 2007, Credit Risk Products and Equity Issuer Trust.
16
(1) Adjusted to exclude Consolidated Partnerships, mortgage revenue bonds re-securitized in December 2007, Credit Risk Products and Equity Issuer Trust.
Q1 2012 Detailed As Adjusted Income Statement
(2) Includes prepayment penalties, expense reimbursements, gains on sales of mortgage loans and other revenues.
(3) Amounts calculate to less than one cent per share.
18
P&L Adjustments - Details
Consolidated Partnerships
Centerline’s operating results include the results of Tax Credit Fund Partnerships as well as Property Partnerships that Centerline controls and that are required to be consolidated
pursuant to various accounting pronouncements but in which it has practically no economic interest in. As Centerline has no economic interest in these partnerships, the net losses they
generated were allocated almost entirely to the Partnerships' investors. The consolidation, therefore, has an insignificant impact on net income (loss), although certain Centerline
operating results are eliminated in consolidation, and operating results of the consolidated partnerships are reflected in the income statement.
pursuant to various accounting pronouncements but in which it has practically no economic interest in. As Centerline has no economic interest in these partnerships, the net losses they
generated were allocated almost entirely to the Partnerships' investors. The consolidation, therefore, has an insignificant impact on net income (loss), although certain Centerline
operating results are eliminated in consolidation, and operating results of the consolidated partnerships are reflected in the income statement.
Given the above, the Company is presenting its operating results adjusted to exclude the impact of such partnerships’ consolidation.
Mortgage Revenue Bonds
For GAAP reporting purposes, consummation of the December 2007 Re-Securitization with Freddie Mac constituted a sale of the mortgage revenue bond investments, with the
exception of certain bonds for which our continuing involvement precluded sale treatment. The Company is presenting its operating results adjusted to reflect all mortgage revenue
bonds included in the December 2007 Re-Securitization as sold.
exception of certain bonds for which our continuing involvement precluded sale treatment. The Company is presenting its operating results adjusted to reflect all mortgage revenue
bonds included in the December 2007 Re-Securitization as sold.
ØThe balance sheet adjustments primarily relate to cash and deposits receivable which collateralize credit intermediation agreements, outstanding under a senior credit facility
with no recourse to Centerline, loss reserves for credit intermediation agreements, deferred income, and fees payable for the restructuring of certain credit intermediation
agreements.
with no recourse to Centerline, loss reserves for credit intermediation agreements, deferred income, and fees payable for the restructuring of certain credit intermediation
agreements.
ØThe income statement adjustments primarily relate to fee income on credit intermediation agreements, provision for losses on credit intermediation agreements, fee expense
relating to certain restructured credit intermediation agreements and equity income on the investment in Credit Risk Product subsidiaries.
relating to certain restructured credit intermediation agreements and equity income on the investment in Credit Risk Product subsidiaries.
Centerline Equity Issuer Trust (“EIT”)
Centerline’s operating results include the income related to Series A-1 Freddie Mac Certificates, and expenses related to preferred shares issued by EIT, a special purpose entity. Such
preferred shares are secured by EIT’s assets, are non-recourse to Centerline and shares are fully defeased in principle and maturity by the Freddie Mac A-1 certificates. Accordingly, the
Company is presenting its operating results adjusted to exclude the impact of EIT’s consolidation.
preferred shares are secured by EIT’s assets, are non-recourse to Centerline and shares are fully defeased in principle and maturity by the Freddie Mac A-1 certificates. Accordingly, the
Company is presenting its operating results adjusted to exclude the impact of EIT’s consolidation.
Credit Risk Products
In March 2010, a series of transactions were entered into whereby our obligations under back to back credit default swaps issued to two counterparties where assigned and assumed by
certain isolated special purpose entities, relieving the Company’s assets from exposure to potential contingent liabilities. While the credit default counterparties have significant
consent rights with respect to key activities of the isolated special purpose entities, the Company consolidates the isolated special purpose entities for GAAP purposes. The Company
has adjusted its operating results to reflect such isolated special purpose entities as if they were equity method investments.
certain isolated special purpose entities, relieving the Company’s assets from exposure to potential contingent liabilities. While the credit default counterparties have significant
consent rights with respect to key activities of the isolated special purpose entities, the Company consolidates the isolated special purpose entities for GAAP purposes. The Company
has adjusted its operating results to reflect such isolated special purpose entities as if they were equity method investments.
19
Glossary