Attached files
| file | filename |
|---|---|
| 8-K - 8-K - WASHINGTON REAL ESTATE INVESTMENT TRUST | q12013earningsrelease8-k.htm |
| EX-99.1 - EARNINGS RELEASE - WASHINGTON REAL ESTATE INVESTMENT TRUST | q12013earningsrelease.htm |
 | ||||||
First Quarter 2013 | ||||||
 | ||||||
Supplemental Operating and Financial Data | ||||||
Contact: | 6110 Executive Boulevard | |||||
William T. Camp | Suite 800 | |||||
Executive Vice President and | Rockville, MD 20852 | |||||
Chief Financial Officer | (301) 984-9400 | |||||
E-mail: bcamp@writ.com | (301) 984-9610 fax | |||||
Company Background and Highlights First Quarter 2013 |
Washington Real Estate Investment Trust ("WRIT") is a self-administered, self-managed, equity real estate investment trust investing in income-producing properties in the greater Washington metro region. WRIT is diversified, as it invests in office, medical office, retail, and multifamily properties and land for development.
In the first quarter WRIT sold The Atrium Building, an 80,000 square foot office building in Rockville, Maryland, for $15.75 million and a net book gain of $3.2 million. The property was built in 1980 and acquired by WRIT in 2002. WRIT achieved an unleveraged internal rate of return of 11% over the ten year holding period.
WRIT repaid its $60 million 5.125% unsecured notes using proceeds from a draw on its line of credit. WRIT also prepaid without penalty the West Gude 5.855% mortgage note for $30.0 million, funded by cash and a draw on its line of credit. As of March 31, 2013, WRIT's line of credit balance was $70 million.
In the first quarter and subsequent to quarter end, WRIT announced the hiring of two Division Heads: Paul S. Weinschenk as Managing Director and Vice President, Head of Retail Division, and Edward J. Murn, IV as Managing Director, Head of Residential Division. Both will be responsible for overseeing the operations, investment and development of their respective divisions.
WRIT signed commercial leases totaling 387,656 square feet, including 127,295 square feet of new leases and 260,361 square feet of renewal leases. New leases had an average rental rate increase of 22.1% over expiring lease rates on a GAAP basis, an average lease term of 7.9 years, and total concessions of $65.45 per square foot. Renewal leases had an average rental rate increase of 6.7% over expiring lease rates on a GAAP basis, an average lease term of 3.3 years, and total concessions of $7.22 per square foot.
As of March 31, 2013, WRIT owned a diversified portfolio of 69 properties totaling approximately 8 million square feet of commercial space and 2,540 residential units, and land held for development. These 69 properties consist of 25 office properties, 17 medical office properties, 16 retail centers and 11 multifamily properties. WRIT shares are publicly traded on the New York Stock Exchange (NYSE: WRE).
Company Background and Highlights First Quarter 2013 |
Net Operating Income Contribution by Sector - First Quarter 2013
Certain statements in our earnings release and on our conference call are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially. Such risks, uncertainties and other factors include, but are not limited to, the potential for federal government budget reductions, changes in general and local economic and real estate market conditions, the timing and pricing of lease transactions, the effect of the current credit and financial market conditions, the availability and cost of capital, fluctuations in interest rates, tenants' financial conditions, levels of competition, the effect of government regulation, the impact of newly adopted accounting principles, and other risks and uncertainties detailed from time to time in our filings with the SEC, including our 2012 Form 10-K. We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.
Supplemental Financial and Operating Data Table of Contents March 31, 2013 | ||
Schedule | Page | |
Key Financial Data | ||
Capital Analysis | ||
Portfolio Analysis | ||
Growth and Strategy | ||
Tenant Analysis | ||
Appendix | ||
Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) |  |
Three Months Ended | |||||||||||||||||||
OPERATING RESULTS | 3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | ||||||||||||||
Real estate rental revenue | $ | 76,924 | $ | 77,071 | $ | 77,108 | $ | 75,590 | $ | 75,214 | |||||||||
Real estate expenses | (27,091 | ) | (25,791 | ) | (26,901 | ) | (25,033 | ) | (25,551 | ) | |||||||||
49,833 | 51,280 | 50,207 | 50,557 | 49,663 | |||||||||||||||
Real estate depreciation and amortization | (25,524 | ) | (26,131 | ) | (26,127 | ) | (25,227 | ) | (25,582 | ) | |||||||||
Income from real estate | 24,309 | 25,149 | 24,080 | 25,330 | 24,081 | ||||||||||||||
Interest expense | (16,518 | ) | (17,411 | ) | (15,985 | ) | (15,470 | ) | (15,831 | ) | |||||||||
Other income | 239 | 242 | 237 | 252 | 244 | ||||||||||||||
Acquisition costs | (213 | ) | (90 | ) | 164 | (254 | ) | (54 | ) | ||||||||||
Real estate impairment | — | (2,097 | ) | — | — | — | |||||||||||||
General and administrative | (3,862 | ) | (4,545 | ) | (3,173 | ) | (4,164 | ) | (3,606 | ) | |||||||||
Income from continuing operations | 3,955 | 1,248 | 5,323 | 5,694 | 4,834 | ||||||||||||||
Discontinued operations: | |||||||||||||||||||
Income from operations of properties sold or held for sale | 185 | 310 | 514 | 314 | 347 | ||||||||||||||
Gain on sale of real estate | 3,195 | 1,400 | 3,724 | — | — | ||||||||||||||
Income from discontinued operations | 3,380 | 1,710 | 4,238 | 314 | 347 | ||||||||||||||
Net income | $ | 7,335 | $ | 2,958 | $ | 9,561 | $ | 6,008 | $ | 5,181 | |||||||||
Per Share Data: | |||||||||||||||||||
Net income | $ | 0.11 | $ | 0.04 | $ | 0.14 | $ | 0.09 | $ | 0.08 | |||||||||
Fully diluted weighted average shares outstanding | 66,519 | 66,416 | 66,379 | 66,380 | 66,328 | ||||||||||||||
Percentage of Revenues: | |||||||||||||||||||
Real estate expenses | 35.2 | % | 33.5 | % | 34.9 | % | 33.1 | % | 34.0 | % | |||||||||
General and administrative | 5.0 | % | 5.9 | % | 4.1 | % | 5.5 | % | 4.8 | % | |||||||||
Ratios: | |||||||||||||||||||
Adjusted EBITDA / Interest expense | 2.8x | 2.7x | 3.0x | 3.1x | 3.0x | ||||||||||||||
Income from continuing operations/Total real estate revenue | 5.1 | % | 1.6 | % | 6.9 | % | 7.5 | % | 6.4 | % | |||||||||
Net income /Total real estate revenue | 9.5 | % | 3.8 | % | 12.4 | % | 7.9 | % | 6.9 | % | |||||||||
Note: Certain prior quarter amounts have been reclassified to conform to the current quarter presentation. | |||||||||||||||||||
4
Consolidated Balance Sheets (In thousands) (Unaudited) | |
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||||||||
Assets | |||||||||||||||||||
Land | $ | 483,198 | $ | 483,198 | $ | 483,198 | $ | 483,199 | $ | 465,445 | |||||||||
Income producing property | 1,988,929 | 1,979,348 | 1,966,032 | 1,953,160 | 1,912,395 | ||||||||||||||
2,472,127 | 2,462,546 | 2,449,230 | 2,436,359 | 2,377,840 | |||||||||||||||
Accumulated depreciation and amortization | (625,774 | ) | (604,614 | ) | (583,706 | ) | (563,036 | ) | (542,322 | ) | |||||||||
Net income producing property | 1,846,353 | 1,857,932 | 1,865,524 | 1,873,323 | 1,835,518 | ||||||||||||||
Development in progress, including land held for development | 52,906 | 49,135 | 48,106 | 45,928 | 44,236 | ||||||||||||||
Total real estate held for investment, net | 1,899,259 | 1,907,067 | 1,913,630 | 1,919,251 | 1,879,754 | ||||||||||||||
Investment in real estate held for sale, net | — | 11,528 | 18,264 | 27,076 | 27,475 | ||||||||||||||
Cash and cash equivalents | 16,743 | 19,324 | 68,403 | 14,367 | 17,809 | ||||||||||||||
Restricted cash | 10,804 | 14,582 | 19,615 | 19,632 | 21,722 | ||||||||||||||
Rents and other receivables, net of allowance for doubtful accounts | 59,429 | 57,076 | 57,704 | 56,861 | 54,089 | ||||||||||||||
Prepaid expenses and other assets | 109,885 | 114,541 | 120,486 | 115,192 | 114,279 | ||||||||||||||
Other assets related to properties sold or held for sale | — | 258 | 693 | 1,292 | 1,418 | ||||||||||||||
Total assets | $ | 2,096,120 | $ | 2,124,376 | $ | 2,198,795 | $ | 2,153,671 | $ | 2,116,546 | |||||||||
Liabilities | |||||||||||||||||||
Notes payable | $ | 846,323 | $ | 906,190 | $ | 906,058 | $ | 607,653 | $ | 657,562 | |||||||||
Mortgage notes payable | 312,396 | 342,970 | 398,511 | 420,898 | 422,091 | ||||||||||||||
Lines of credit | 70,000 | — | — | 221,000 | 109,000 | ||||||||||||||
Accounts payable and other liabilities | 57,523 | 52,823 | 54,916 | 54,304 | 57,408 | ||||||||||||||
Advance rents | 15,203 | 16,096 | 13,829 | 15,104 | 14,965 | ||||||||||||||
Tenant security deposits | 9,849 | 9,936 | 9,771 | 9,671 | 8,810 | ||||||||||||||
Other liabilities related to properties sold or held for sale | — | 218 | 4,646 | 4,826 | 4,991 | ||||||||||||||
Total liabilities | 1,311,294 | 1,328,233 | 1,387,731 | 1,333,456 | 1,274,827 | ||||||||||||||
Equity | |||||||||||||||||||
Preferred shares; $0.01 par value; 10,000 shares authorized | — | — | — | — | — | ||||||||||||||
Shares of beneficial interest, $0.01 par value; 100,000 shares authorized | 665 | 664 | 662 | 662 | 662 | ||||||||||||||
Additional paid-in capital | 1,146,683 | 1,145,515 | 1,143,554 | 1,142,391 | 1,141,062 | ||||||||||||||
Distributions in excess of net income | (366,821 | ) | (354,122 | ) | (337,151 | ) | (326,714 | ) | (303,815 | ) | |||||||||
Total shareholders' equity | 780,527 | 792,057 | 807,065 | 816,339 | 837,909 | ||||||||||||||
Noncontrolling interests in subsidiaries | 4,299 | 4,086 | 3,999 | 3,876 | 3,810 | ||||||||||||||
Total equity | 784,826 | 796,143 | 811,064 | 820,215 | 841,719 | ||||||||||||||
Total liabilities and equity | $ | 2,096,120 | $ | 2,124,376 | $ | 2,198,795 | $ | 2,153,671 | $ | 2,116,546 | |||||||||
Total Debt / Total Market Capitalization | 0.40 | :1 | 0.42 | :1 | 0.42 | :1 | 0.40 | :1 | 0.38 | :1 | |||||||||
5
Funds from Operations (In thousands, except per share data) (Unaudited) | |
Three Months Ended | |||||||||||||||||||
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||||||||
Funds from operations(1) | |||||||||||||||||||
Net income | $ | 7,335 | $ | 2,958 | $ | 9,561 | $ | 6,008 | $ | 5,181 | |||||||||
Real estate depreciation and amortization | 25,524 | 26,131 | 26,127 | 25,227 | 25,582 | ||||||||||||||
Discontinued operations: | |||||||||||||||||||
Gain on sale of real estate | (3,195 | ) | (1,400 | ) | (3,724 | ) | — | — | |||||||||||
Real estate depreciation and amortization | — | — | 91 | 364 | 412 | ||||||||||||||
Funds from operations (FFO) | 29,664 | 27,689 | 32,055 | 31,599 | 31,175 | ||||||||||||||
Real estate impairment | — | 2,097 | — | — | — | ||||||||||||||
Severance expense | (183 | ) | 1,583 | — | — | — | |||||||||||||
Acquisition costs | 213 | 90 | (164 | ) | 254 | 54 | |||||||||||||
Core FFO (1) | $ | 29,694 | $ | 31,459 | $ | 31,891 | $ | 31,853 | $ | 31,229 | |||||||||
Allocation to participating securities(2) | (120 | ) | (93 | ) | (125 | ) | (176 | ) | (188 | ) | |||||||||
FFO per share - basic | $ | 0.44 | $ | 0.42 | $ | 0.48 | $ | 0.47 | $ | 0.47 | |||||||||
FFO per share - fully diluted | $ | 0.44 | $ | 0.42 | $ | 0.48 | $ | 0.47 | $ | 0.47 | |||||||||
Core FFO per share - fully diluted | $ | 0.44 | $ | 0.47 | $ | 0.48 | $ | 0.48 | $ | 0.47 | |||||||||
Common dividend per share | $ | 0.30 | $ | 0.30 | $ | 0.30 | $ | 0.43375 | $ | 0.43375 | |||||||||
Average shares - basic | 66,393 | 66,273 | 66,246 | 66,241 | 66,194 | ||||||||||||||
Average shares - fully diluted | 66,519 | 66,416 | 66,379 | 66,380 | 66,328 | ||||||||||||||
(1) See "Supplemental Definitions" on page 29 of this supplemental for the definitions of FFO and Core FFO. | |||||||||||||||||||
(2) Adjustment to the numerators for FFO and Core FFO per share calculations when applying the two-class method for calculating EPS. | |||||||||||||||||||
6
Funds Available for Distribution (In thousands, except per share data) (Unaudited) | |
Three Months Ended | |||||||||||||||||||
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||||||||
Funds available for distribution(1) | |||||||||||||||||||
FFO | $ | 29,664 | $ | 27,689 | $ | 32,055 | $ | 31,599 | $ | 31,175 | |||||||||
Tenant improvements | (3,975 | ) | (4,901 | ) | (5,216 | ) | (2,357 | ) | (4,066 | ) | |||||||||
Leasing commissions and incentives | (2,606 | ) | (2,334 | ) | (2,144 | ) | (2,122 | ) | (2,557 | ) | |||||||||
Recurring capital improvements | (721 | ) | (1,414 | ) | (1,362 | ) | (2,992 | ) | (1,539 | ) | |||||||||
Straight-line rent, net | (343 | ) | (738 | ) | (847 | ) | (688 | ) | (992 | ) | |||||||||
Non-cash fair value interest expense | 254 | 253 | 216 | 229 | 228 | ||||||||||||||
Non-real estate depreciation and amortization | 958 | 911 | 987 | 948 | 1,008 | ||||||||||||||
Amortization of lease intangibles, net | 41 | 41 | (32 | ) | (3 | ) | — | ||||||||||||
Amortization and expensing of restricted share and unit compensation | 1,018 | 1,842 | 1,206 | 1,333 | 1,405 | ||||||||||||||
Real estate impairment | — | 2,097 | — | — | — | ||||||||||||||
Funds available for distribution (FAD) | 24,290 | 23,446 | 24,863 | 25,947 | 24,662 | ||||||||||||||
Non-share-based severance expense | — | 850 | — | — | — | ||||||||||||||
Acquisition costs | 213 | 90 | (164 | ) | 254 | 54 | |||||||||||||
Core FAD (1) | $ | 24,503 | $ | 24,386 | $ | 24,699 | $ | 26,201 | $ | 24,716 | |||||||||
Allocation to participating securities(2) | (120 | ) | (93 | ) | (125 | ) | (176 | ) | (188 | ) | |||||||||
FAD per share - basic | $ | 0.36 | $ | 0.35 | $ | 0.37 | $ | 0.39 | $ | 0.37 | |||||||||
FAD per share - fully diluted | $ | 0.36 | $ | 0.35 | $ | 0.37 | $ | 0.39 | $ | 0.37 | |||||||||
Core FAD per share - fully diluted | $ | 0.37 | $ | 0.37 | $ | 0.37 | $ | 0.39 | $ | 0.37 | |||||||||
Common dividend per share | $ | 0.30 | $ | 0.30 | $ | 0.30 | $ | 0.43375 | $ | 0.43375 | |||||||||
Average shares - basic | 66,393 | 66,273 | 66,246 | 66,241 | 66,194 | ||||||||||||||
Average shares - fully diluted | 66,519 | 66,416 | 66,379 | 66,380 | 66,328 | ||||||||||||||
(1) See "Supplemental Definitions" on page 29 of this supplemental for the definitions of FAD and Core FAD. (2) Adjustment to the numerators for FAD and Core FAD per share calculations when applying the two-class method for calculating EPS. | |||||||||||||||||||
7
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) (In thousands) (Unaudited) | |
Three Months Ended | |||||||||||||||||||
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||||||||
Adjusted EBITDA (1) | |||||||||||||||||||
Net income | $ | 7,335 | $ | 2,958 | $ | 9,561 | $ | 6,008 | $ | 5,181 | |||||||||
Add: | |||||||||||||||||||
Interest expense, including discontinued operations | 16,518 | 17,481 | 16,049 | 15,533 | 15,895 | ||||||||||||||
Real estate depreciation and amortization, including discontinued operations | 25,524 | 26,131 | 26,218 | 25,591 | 25,994 | ||||||||||||||
Income tax expense | — | 57 | 17 | 158 | 13 | ||||||||||||||
Real estate impairment | — | 2,097 | — | — | — | ||||||||||||||
Non-real estate depreciation | 196 | 131 | 254 | 261 | 268 | ||||||||||||||
Less: | |||||||||||||||||||
Gain on sale of real estate | (3,195 | ) | (1,400 | ) | (3,724 | ) | — | — | |||||||||||
Adjusted EBITDA | $ | 46,378 | $ | 47,455 | $ | 48,375 | $ | 47,551 | $ | 47,351 | |||||||||
(1) Adjusted EBITDA is earnings before interest expense, taxes, depreciation, amortization, gain on sale of real estate, gain/loss on extinguishment of debt and gain from non-disposal activities. We consider Adjusted EBITDA to be an appropriate supplemental performance measure because it permits investors to view income from operations without the effect of depreciation, the cost of debt or non-operating gains and losses. Adjusted EBITDA is a non-GAAP measure. | |||||||||||||||||||
8
Long Term Debt Analysis (In thousands, except per share data) | |
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||||||||
Balances Outstanding | |||||||||||||||||||
Secured | |||||||||||||||||||
Conventional fixed rate (1) | $ | 312,396 | $ | 342,970 | $ | 402,857 | $ | 425,268 | $ | 426,485 | |||||||||
Unsecured | |||||||||||||||||||
Fixed rate bonds and notes | 846,323 | 906,190 | 906,058 | 607,653 | 657,562 | ||||||||||||||
Credit facility | 70,000 | — | — | 221,000 | 109,000 | ||||||||||||||
Unsecured total | 916,323 | 906,190 | 906,058 | 828,653 | 766,562 | ||||||||||||||
Total | $ | 1,228,719 | $ | 1,249,160 | $ | 1,308,915 | $ | 1,253,921 | $ | 1,193,047 | |||||||||
Average Interest Rates | |||||||||||||||||||
Secured | |||||||||||||||||||
Conventional fixed rate (1) | 6.1 | % | 6.1 | % | 6.0 | % | 5.9 | % | 5.9 | % | |||||||||
Unsecured | |||||||||||||||||||
Fixed rate bonds | 4.9 | % | 4.9 | % | 4.9 | % | 5.4 | % | 5.4 | % | |||||||||
Credit facilities | 1.4 | % | — | % | — | % | 1.3 | % | 0.9 | % | |||||||||
Unsecured total | 4.7 | % | 4.9 | % | 4.9 | % | 4.3 | % | 4.7 | % | |||||||||
Average | 5.0 | % | 5.3 | % | 5.3 | % | 4.9 | % | 5.2 | % | |||||||||
Note: The current balances outstanding of the secured and unsecured fixed rate bonds and notes are shown net of discounts/premiums in the amount of $3.3 million and $3.7 million, respectively.
(1) Prior quarter balances include the $4.3 million mortgage note payable secured by Plumtree Professional Center, a property we sold on December 20, 2012 which has been reclassified to 'Other liabilities related to properties sold or held for sale'. We repaid this mortgage note payable without penalty on December 11, 2012.
9
Long Term Debt Maturities (In thousands, except per share amounts) | |
Future Maturities of Debt | |||||||||||||||||
Year | Secured Debt | Unsecured Debt | Credit Facilities | Total Debt | Average Interest Rate | ||||||||||||
2013 | — | — | — | — | |||||||||||||
2014 | — | 100,000 | — | 100,000 | 5.3% | ||||||||||||
2015 | 18,510 | 150,000 | 10,000 | 178,510 | 5.2% | ||||||||||||
2016 | 131,765 | — | 60,000 | 191,765 | 4.4% | ||||||||||||
2017 | 101,866 | — | — | 101,866 | 7.3% | ||||||||||||
2018 | — | — | — | — | |||||||||||||
2019 | 31,280 | — | — | 31,280 | 5.4% | ||||||||||||
2020 | — | 250,000 | — | 250,000 | 5.1% | ||||||||||||
2021 | — | — | — | — | |||||||||||||
2022 | — | 300,000 | — | 300,000 | 4.0% | ||||||||||||
2023 | — | — | — | — | |||||||||||||
Thereafter | — | 50,000 | — | 50,000 | 7.4% | ||||||||||||
Scheduled principal payments | $ | 283,421 | $ | 850,000 | $ | 70,000 | $ | 1,203,421 | 5.0% | ||||||||
Scheduled amortization payments | 32,270 | — | — | 32,270 | 5.2% | ||||||||||||
Net discounts/premiums | (3,295 | ) | (3,677 | ) | — | (6,972 | ) | ||||||||||
Total maturities | $ | 312,396 | $ | 846,323 | $ | 70,000 | $ | 1,228,719 | 5.0% | ||||||||
Weighted average maturity = 6.0 years
10
Debt Covenant Compliance | |
Unsecured Notes Payable | Unsecured Line of Credit #1 ($100.0 million) | Unsecured Line of Credit #2 ($400.0 million) | ||||||||||||
Quarter Ended March 31, 2013 | Covenant | Quarter Ended March 31, 2013 | Covenant | Quarter Ended March 31, 2013 | Covenant | |||||||||
% of Total Indebtedness to Total Assets(1) | 43.2 | % | ≤ 65.0% | N/A | N/A | N/A | N/A | |||||||
Ratio of Income Available for Debt Service to Annual Debt Service | 3.0 | ≥ 1.5 | N/A | N/A | N/A | N/A | ||||||||
% of Secured Indebtedness to Total Assets(1) | 11.0 | % | ≤ 40.0% | N/A | N/A | N/A | N/A | |||||||
Ratio of Total Unencumbered Assets(2) to Total Unsecured Indebtedness | 2.5 | ≥ 1.5 | N/A | N/A | N/A | N/A | ||||||||
Tangible Net Worth(3) | N/A | N/A | $853.8 million | ≥ $673.4 million | $855.0 million | ≥ $671.9 million | ||||||||
% of Total Liabilities to Gross Asset Value(5) | N/A | N/A | 51.7 | % | ≤ 60.0% | 51.7 | % | ≤ 60.0% | ||||||
% of Secured Indebtedness to Gross Asset Value(5) | N/A | N/A | 12.3 | % | ≤ 35.0% | 12.3 | % | ≤ 35.0% | ||||||
Ratio of EBITDA(4) to Fixed Charges(6) | N/A | N/A | 2.56 | ≥ 1.50 | 2.56 | ≥ 1.50 | ||||||||
Ratio of Unencumbered Pool Value(7) to Unsecured Indebtedness | N/A | N/A | 2.23 | ≥ 1.67 | 2.23 | ≥ 1.67 | ||||||||
Ratio of Unencumbered Net Operating Income to Unsecured Interest Expense | N/A | N/A | 3.23 | ≥ 2.00 | 3.23 | ≥ 2.00 | ||||||||
Ratio of Investments(8) to Gross Asset Value(5) | N/A | N/A | 3.4 | % | ≤ 15.0% | 3.4 | % | ≤ 15.0% | ||||||
(1) Total Assets is calculated by applying a capitalization rate of 7.50% to the EBITDA(4) from the last four consecutive quarters, excluding EBITDA from acquired, disposed, and non-stabilized development properties. | ||||||||||||||
(2) Total Unencumbered Assets is calculated by applying a capitalization rate of 7.50% to the EBITDA(4) from unencumbered properties from the last four consecutive quarters, excluding EBITDA from acquired, disposed, and non-stabilized development properties. | ||||||||||||||
(3) Tangible Net Worth is defined as shareholders equity less accumulated depreciation at the commitment start date plus current accumulated depreciation. | ||||||||||||||
(4) EBITDA is defined in our debt covenants as earnings before minority interests, depreciation, amortization, interest expense, income tax expense, and extraordinary and nonrecurring gains and losses. | ||||||||||||||
(5) Gross Asset Value is calculated by applying a capitalization rate to the annualized EBITDA(4) from the most recently ended quarter, excluding EBITDA from disposed properties and current quarter acquisitions. To this amount, the purchase price of current quarter acquisitions, cash and cash equivalents and development in progress is added. | ||||||||||||||
(6) Fixed Charges consist of interest expense, principal payments, ground lease payments and replacement reserve payments. | ||||||||||||||
(7) Unencumbered Pool Value is calculated by applying a capitalization rate of 7.50% to the net operating income from unencumbered properties owned for the entire quarter. To this we add the purchase price of unencumbered acquisitions during the current quarter. | ||||||||||||||
(8) Investments is defined as development in progress, including land held for development, plus budgeted development costs upon commencement of construction, if any. | ||||||||||||||
11
Capital Analysis (In thousands, except per share amounts) | |
3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||||||||
Market Data | |||||||||||||||||||
Shares Outstanding | 66,485 | 66,437 | 66,325 | 66,321 | 66,309 | ||||||||||||||
Market Price per Share | $ | 27.84 | $ | 26.15 | $ | 26.82 | $ | 28.45 | $ | 29.70 | |||||||||
Equity Market Capitalization | $ | 1,850,942 | $ | 1,737,328 | $ | 1,778,837 | $ | 1,886,832 | $ | 1,969,377 | |||||||||
Total Debt | $ | 1,228,719 | $ | 1,249,160 | $ | 1,308,915 | $ | 1,253,921 | $ | 1,193,047 | |||||||||
Total Market Capitalization | $ | 3,079,661 | $ | 2,986,488 | $ | 3,087,752 | $ | 3,140,753 | $ | 3,162,424 | |||||||||
Total Debt to Market Capitalization | 0.40 | :1 | 0.42 | :1 | 0.42 | :1 | 0.40 | :1 | 0.38 | :1 | |||||||||
Earnings to Fixed Charges(1) | 1.2x | 1.0x | 1.3x | 1.3x | 1.3x | ||||||||||||||
Debt Service Coverage Ratio(2) | 2.7x | 2.6x | 2.8x | 2.8x | 2.7x | ||||||||||||||
Dividend Data | |||||||||||||||||||
Total Dividends Paid | $ | 20,034 | $ | 19,928 | $ | 19,998 | $ | 28,772 | $ | 28,746 | |||||||||
Common Dividend per Share | $ | 0.30 | $ | 0.30 | $ | 0.30 | $ | 0.43375 | $ | 0.43375 | |||||||||
Payout Ratio (Core FFO per share basis) | 68.2 | % | 63.8 | % | 62.5 | % | 90.4 | % | 92.3 | % | |||||||||
Payout Ratio (Core FAD per share basis) | 81.1 | % | 81.1 | % | 81.1 | % | 111.2 | % | 117.2 | % | |||||||||
Payout Ratio (FAD per share basis) | 83.3 | % | 85.7 | % | 81.1 | % | 111.2 | % | 117.2 | % | |||||||||
(1) The ratio of earnings to fixed charges is computed by dividing earnings by fixed charges. For this purpose, earnings consist of income from continuing operations attributable to the controlling interests plus fixed charges, less capitalized interest. Fixed charges consist of interest expense, including amortized costs of debt issuance, plus interest costs capitalized. | |||||||||||||||||||
(2) Debt service coverage ratio is computed by dividing Adjusted EBITDA (see page 8) by interest expense and principal amortization. | |||||||||||||||||||
12
Same-Store Portfolio Net Operating Income (NOI) Growth & Rental Growth 2013 vs. 2012 | |
Three Months Ended March 31, (1) | |||||||||||||
2013 | 2012 | % Change | Rental Rate Growth | ||||||||||
Cash Basis: | |||||||||||||
Multifamily | $ | 7,783 | $ | 7,872 | (1.1 | )% | 4.1 | % | |||||
Office Buildings | 23,784 | 23,848 | (0.3 | )% | 2.6 | % | |||||||
Medical Office Buildings | 6,888 | 7,242 | (4.9 | )% | 2.1 | % | |||||||
Retail Centers | 10,191 | 9,628 | 5.8 | % | 4.4 | % | |||||||
Overall Same-Store Portfolio (1) | $ | 48,646 | $ | 48,590 | 0.1 | % | 3.1 | % | |||||
GAAP Basis: | |||||||||||||
Multifamily | $ | 7,943 | $ | 8,065 | (1.5 | )% | 4.0 | % | |||||
Office Buildings | 23,820 | 24,115 | (1.2 | )% | 1.9 | % | |||||||
Medical Office Buildings | 6,864 | 7,460 | (8.0 | )% | 1.9 | % | |||||||
Retail Centers | 10,269 | 10,002 | 2.7 | % | 3.1 | % | |||||||
Overall Same-Store Portfolio (1) | $ | 48,896 | $ | 49,642 | (1.5 | )% | 2.5 | % | |||||
(1) Non same-store properties were: |
Acquisitions: |
Office - Fairgate at Ballston |
Medical Office - 19500 at Riverside Office Park (formerly Lansdowne Medical Office Building) |
Held for sale and sold properties: |
Office - 1700 Research Boulevard and the Atrium Building |
Medical Office - Plumtree Medical Center |
13
Same-Store Portfolio Net Operating Income (NOI) Detail (In thousands) | |
Three Months Ended March 31, 2013 | |||||||||||||||||||||||
Multifamily | Office | Medical Office | Retail | Corporate and Other | Total | ||||||||||||||||||
Real estate rental revenue | |||||||||||||||||||||||
Same-store portfolio | $ | 13,333 | $ | 37,393 | $ | 10,734 | $ | 13,834 | — | $ | 75,294 | ||||||||||||
Non same-store - acquired and in development (1) | — | 1,336 | 294 | — | 1,630 | ||||||||||||||||||
Total | 13,333 | 38,729 | 11,028 | 13,834 | — | 76,924 | |||||||||||||||||
Real estate expenses | |||||||||||||||||||||||
Same-store portfolio | 5,390 | 13,573 | 3,870 | 3,565 | — | 26,398 | |||||||||||||||||
Non same-store - acquired and in development (1) | — | 505 | 188 | — | 693 | ||||||||||||||||||
Total | 5,390 | 14,078 | 4,058 | 3,565 | — | 27,091 | |||||||||||||||||
Net Operating Income (NOI) | |||||||||||||||||||||||
Same-store portfolio | 7,943 | 23,820 | 6,864 | 10,269 | — | 48,896 | |||||||||||||||||
Non same-store - acquired and in development (1) | — | 831 | 106 | — | — | 937 | |||||||||||||||||
Total | $ | 7,943 | $ | 24,651 | $ | 6,970 | $ | 10,269 | — | $ | 49,833 | ||||||||||||
Same-store portfolio NOI GAAP basis (from above) | $ | 7,943 | $ | 23,820 | $ | 6,864 | $ | 10,269 | — | $ | 48,896 | ||||||||||||
Straight-line revenue, net for same-store properties | 6 | (259 | ) | 62 | (45 | ) | — | (236 | ) | ||||||||||||||
FAS 141 Min Rent | (166 | ) | 44 | (60 | ) | (89 | ) | — | (271 | ) | |||||||||||||
Amortization of lease intangibles for same-store properties | — | 179 | 22 | 56 | — | 257 | |||||||||||||||||
Same-store portfolio NOI, cash basis | $ | 7,783 | $ | 23,784 | $ | 6,888 | $ | 10,191 | — | $ | 48,646 | ||||||||||||
Reconciliation of NOI to net income | |||||||||||||||||||||||
Total NOI | $ | 7,943 | $ | 24,651 | $ | 6,970 | $ | 10,269 | — | $ | 49,833 | ||||||||||||
Depreciation and amortization | (3,037 | ) | (14,870 | ) | (3,822 | ) | (3,530 | ) | (265 | ) | (25,524 | ) | |||||||||||
General and administrative | — | — | — | — | (3,862 | ) | (3,862 | ) | |||||||||||||||
Interest expense | (1,671 | ) | (2,602 | ) | (328 | ) | (275 | ) | (11,642 | ) | (16,518 | ) | |||||||||||
Other income | — | — | — | — | 239 | 239 | |||||||||||||||||
Acquisition costs | — | — | — | — | (213 | ) | (213 | ) | |||||||||||||||
Discontinued operations: | |||||||||||||||||||||||
Income from operations of properties sold or held for sale (1) | — | 185 | — | — | 185 | ||||||||||||||||||
Gain on sale of real estate | — | — | — | — | 3,195 | 3,195 | |||||||||||||||||
Net income (loss) | $ | 3,235 | $ | 7,364 | $ | 2,820 | $ | 6,464 | $ | (12,548 | ) | $ | 7,335 | ||||||||||
(1) For a list of non-same-store properties and held for sale and sold properties, see page 13 of this Supplemental. | |||||||||||||||||||||||
14
Same-Store Net Operating Income (NOI) Detail (In thousands) | |
Three Months Ended March 31, 2012 | |||||||||||||||||||||||
Multifamily | Office | Medical Office | Retail | Corporate and Other | Total | ||||||||||||||||||
Real estate rental revenue | |||||||||||||||||||||||
Same-store portfolio | $ | 12,996 | $ | 37,547 | $ | 10,995 | $ | 13,446 | — | $ | 74,984 | ||||||||||||
Non same-store - acquired and in development (1) | — | — | 230 | — | — | 230 | |||||||||||||||||
Total | 12,996 | 37,547 | 11,225 | 13,446 | — | 75,214 | |||||||||||||||||
Real estate expenses | |||||||||||||||||||||||
Same-store portfolio | 4,931 | 13,432 | 3,535 | 3,444 | — | 25,342 | |||||||||||||||||
Non same-store - acquired and in development (1) | — | 45 | 164 | — | — | 209 | |||||||||||||||||
Total | 4,931 | 13,477 | 3,699 | 3,444 | — | 25,551 | |||||||||||||||||
Net Operating Income (NOI) | |||||||||||||||||||||||
Same-store portfolio | 8,065 | 24,115 | 7,460 | 10,002 | — | 49,642 | |||||||||||||||||
Non same-store - acquired and in development (1) | — | (45 | ) | 66 | — | — | 21 | ||||||||||||||||
Total | $ | 8,065 | $ | 24,070 | $ | 7,526 | $ | 10,002 | — | $ | 49,663 | ||||||||||||
Same-store portfolio NOI GAAP basis (from above) | $ | 8,065 | $ | 24,115 | $ | 7,460 | $ | 10,002 | — | $ | 49,642 | ||||||||||||
Straight-line revenue, net for same-store properties | (2 | ) | (519 | ) | (139 | ) | (337 | ) | — | (997 | ) | ||||||||||||
FAS 141 Min Rent | (191 | ) | 114 | (89 | ) | (86 | ) | — | (252 | ) | |||||||||||||
Amortization of lease intangibles for same-store properties | — | 138 | 10 | 49 | — | 197 | |||||||||||||||||
Same-store portfolio NOI, cash basis | $ | 7,872 | $ | 23,848 | $ | 7,242 | $ | 9,628 | — | $ | 48,590 | ||||||||||||
Reconciliation of NOI to net income | |||||||||||||||||||||||
Total NOI | $ | 8,065 | $ | 24,070 | $ | 7,526 | $ | 10,002 | — | $ | 49,663 | ||||||||||||
Depreciation and amortization | (3,123 | ) | (14,843 | ) | (3,797 | ) | (3,583 | ) | (236 | ) | (25,582 | ) | |||||||||||
General and administrative | — | — | — | — | (3,606 | ) | (3,606 | ) | |||||||||||||||
Interest expense | (1,697 | ) | (3,044 | ) | (1,105 | ) | (602 | ) | (9,383 | ) | (15,831 | ) | |||||||||||
Other income | — | — | — | — | 244 | 244 | |||||||||||||||||
Acquisition costs | — | — | — | — | (54 | ) | (54 | ) | |||||||||||||||
Discontinued operations: | |||||||||||||||||||||||
Income from operations of properties sold or held for sale (1) | — | 333 | 14 | — | — | 347 | |||||||||||||||||
Net income (loss) | $ | 3,245 | $ | 6,516 | $ | 2,638 | $ | 5,817 | $ | (13,035 | ) | $ | 5,181 | ||||||||||
(1) For a list of non-same-store properties and held for sale and sold properties, see page 13 of this Supplemental. | |||||||||||||||||||||||
15
Net Operating Income (NOI) by Region | |
WRIT Portfolio | WRIT Portfolio | |||||||
Maryland/Virginia/DC | Inside & Outside the Beltway | |||||||
Percentage of GAAP NOI | Percentage of GAAP NOI | |||||||
Q1 2013 | Q1 2013 | |||||||
DC | Inside the Beltway | |||||||
Multifamily | 3.8 | % | Multifamily | 15.1 | % | |||
Office | 19.4 | % | Office | 29.5 | % | |||
Medical Office | 1.6 | % | Medical Office | 2.8 | % | |||
Retail | 0.7 | % | Retail | 6.0 | % | |||
25.5 | % | 53.4 | % | |||||
Maryland | Outside the Beltway | |||||||
Multifamily | 2.4 | % | Multifamily | 0.9 | % | |||
Office | 9.2 | % | Office | 19.9 | % | |||
Medical Office | 3.5 | % | Medical Office | 11.2 | % | |||
Retail | 14.6 | % | Retail | 14.6 | % | |||
29.7 | % | 46.6 | % | |||||
Virginia | ||||||||
Multifamily | 9.7 | % | Total Portfolio | 100.0 | % | |||
Office | 21.0 | % | ||||||
Medical Office | 8.9 | % | ||||||
Retail | 5.2 | % | ||||||
44.8 | % | |||||||
Total Portfolio | 100.0 | % | ||||||
16
Same-Store and Overall Physical Occupancy Levels by Sector | | |||
Physical Occupancy - Same-Store Properties (1) | ||||||||||||||
Sector | 3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||
Multifamily | 93.8 | % | 94.1 | % | 94.8 | % | 94.8 | % | 95.2 | % | ||||
Office Buildings | 85.4 | % | 84.9 | % | 86.3 | % | 86.0 | % | 86.4 | % | ||||
Medical Office | 88.4 | % | 89.1 | % | 88.0 | % | 89.7 | % | 90.5 | % | ||||
Retail Centers | 92.4 | % | 91.2 | % | 92.8 | % | 93.3 | % | 92.9 | % | ||||
Overall Portfolio | 89.1 | % | 88.7 | % | 89.8 | % | 89.9 | % | 90.2 | % | ||||
Physical Occupancy - All Properties | ||||||||||||||
Sector | 3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||
Multifamily | 93.8 | % | 94.1 | % | 94.8 | % | 94.8 | % | 95.2 | % | ||||
Office Buildings | 85.4 | % | 84.5 | % | 86.2 | % | 85.8 | % | 86.3 | % | ||||
Medical Office | 85.2 | % | 85.6 | % | 85.0 | % | 86.4 | % | 87.1 | % | ||||
Retail Centers | 92.4 | % | 91.2 | % | 92.8 | % | 93.3 | % | 92.9 | % | ||||
Overall Portfolio | 88.6 | % | 88.1 | % | 89.2 | % | 89.3 | % | 89.7 | % | ||||
(1) Non same-store properties were: |
Acquisitions: |
Office - Fairgate at Ballston |
Medical Office - 19500 at Riverside Office Park (formerly Lansdowne Medical Office Building) |
Held for sale and sold properties: |
Office - 1700 Research Boulevard and the Atrium Building |
Medical Office - Plumtree Medical Center |
17
Same-Store Portfolio and Overall Economic Occupancy Levels by Sector | | |||
Economic Occupancy - Same-Store Properties(1) | ||||||||||||||
Sector | 3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||
Multifamily | 93.1 | % | 93.5 | % | 94.1 | % | 94.1 | % | 94.0 | % | ||||
Office Buildings | 86.0 | % | 86.6 | % | 87.3 | % | 87.2 | % | 87.8 | % | ||||
Medical Office Buildings | 89.7 | % | 91.0 | % | 91.6 | % | 92.3 | % | 93.5 | % | ||||
Retail Centers | 91.6 | % | 92.9 | % | 94.3 | % | 93.7 | % | 94.3 | % | ||||
Overall Portfolio | 88.7 | % | 89.5 | % | 90.3 | % | 90.2 | % | 90.8 | % | ||||
Economic Occupancy - All Properties | ||||||||||||||
Sector | 3/31/2013 | 12/31/2012 | 9/30/2012 | 6/30/2012 | 3/31/2012 | |||||||||
Multifamily | 93.1 | % | 93.5 | % | 94.1 | % | 94.1 | % | 94.0 | % | ||||
Office Buildings | 85.6 | % | 86.0 | % | 87.1 | % | 87.1 | % | 87.8 | % | ||||
Medical Office Buildings | 87.6 | % | 88.7 | % | 89.3 | % | 90.0 | % | 90.8 | % | ||||
Retail Centers | 91.6 | % | 92.9 | % | 94.3 | % | 93.7 | % | 94.3 | % | ||||
Overall Portfolio | 88.2 | % | 88.8 | % | 89.8 | % | 89.8 | % | 90.3 | % | ||||
(1) Non same-store properties were: |
Acquisitions: |
Office - Fairgate at Ballston |
Medical Office - 19500 at Riverside Office Park (formerly Lansdowne Medical Office Building) |
Held for sale and sold properties: |
Office - 1700 Research Boulevard and the Atrium Building |
Medical Office - Plumtree Medical Center |
18
Disposition Summary March 31, 2013 ($'s in thousands) | |
0, 2012
Disposition Summary | |||||||||||||||
Disposition Date | Property Type | Square Feet | Contract Sales Price | GAAP Gain | |||||||||||
The Atrium Building | March 19, 2013 | Office | 79,000 | $ | 15,750 | $ | 3,195 | ||||||||
19
Commercial Leasing Summary - New Leases | |
1st Quarter 2013 | 4th Quarter 2012 | 3rd Quarter 2012 | 2nd Quarter 2012 | 1st Quarter 2012 | |||||||||||||||||||||||||||||||||||
Gross Leasing Square Footage | |||||||||||||||||||||||||||||||||||||||
Office Buildings | 65,566 | 76,252 | 46,351 | 73,877 | 51,615 | ||||||||||||||||||||||||||||||||||
Medical Office Buildings | 15,629 | 15,083 | 17,105 | 11,334 | 15,091 | ||||||||||||||||||||||||||||||||||
Retail Centers | 46,100 | 14,419 | 7,857 | 45,584 | — | ||||||||||||||||||||||||||||||||||
Total | 127,295 | 105,754 | 71,313 | 130,795 | 66,706 | ||||||||||||||||||||||||||||||||||
Weighted Average Term (yrs) | |||||||||||||||||||||||||||||||||||||||
Office Buildings | 8.5 | 8.6 | 6.6 | 7.9 | 8.0 | ||||||||||||||||||||||||||||||||||
Medical Office Buildings | 7.2 | 9.3 | 9.1 | 8.4 | 5.0 | ||||||||||||||||||||||||||||||||||
Retail Centers | 7.3 | 8.0 | 8.4 | 9.0 | — | ||||||||||||||||||||||||||||||||||
Total | 7.9 | 8.6 | 7.4 | 8.3 | 7.3 | ||||||||||||||||||||||||||||||||||
Rental Rate Increases: | GAAP | CASH | GAAP | CASH | GAAP | CASH | GAAP | CASH | GAAP | CASH | |||||||||||||||||||||||||||||
Rate on expiring leases | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 29.14 | $ | 30.36 | $ | 30.72 | $ | 31.19 | $ | 32.63 | $ | 33.45 | $ | 33.73 | $ | 35.06 | $ | 30.79 | $ | 32.06 | |||||||||||||||||||
Medical Office Buildings | 33.53 | 35.53 | 30.85 | 32.40 | 26.10 | 26.59 | 32.81 | 35.85 | 28.55 | 29.50 | |||||||||||||||||||||||||||||
Retail Centers | 10.26 | 10.26 | 18.49 | 18.59 | 21.39 | 21.74 | 26.27 | 26.45 | — | — | |||||||||||||||||||||||||||||
Total | $ | 22.84 | $ | 23.72 | $ | 29.22 | $ | 29.79 | $ | 29.83 | $ | 30.51 | $ | 31.05 | $ | 32.13 | $ | 30.28 | $ | 31.48 | |||||||||||||||||||
Rate on new leases | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 31.96 | $ | 28.86 | $ | 35.41 | $ | 31.66 | $ | 37.20 | $ | 33.72 | $ | 41.78 | $ | 37.91 | $ | 36.20 | $ | 32.64 | |||||||||||||||||||
Medical Office Buildings | 36.67 | 33.94 | 31.30 | 27.69 | 27.46 | 24.79 | 37.64 | 33.44 | 28.57 | 26.91 | |||||||||||||||||||||||||||||
Retail Centers | 19.12 | 19.04 | 16.74 | 15.35 | 33.21 | 30.17 | 26.98 | 24.91 | — | — | |||||||||||||||||||||||||||||
Total | $ | 27.89 | $ | 25.93 | $ | 32.61 | $ | 29.22 | $ | 34.43 | $ | 31.18 | $ | 36.26 | $ | 32.99 | $ | 34.47 | $ | 31.34 | |||||||||||||||||||
Percentage Increase | |||||||||||||||||||||||||||||||||||||||
Office Buildings | 9.7 | % | (4.9 | )% | 15.3 | % | 1.5 | % | 14.0 | % | 0.8 | % | 23.9 | % | 8.1 | % | 17.6 | % | 1.8 | % | |||||||||||||||||||
Medical Office Buildings | 9.4 | % | (4.5 | )% | 1.5 | % | (14.5 | )% | 5.2 | % | (6.8 | )% | 14.7 | % | (6.7 | )% | 0.1 | % | (8.8 | )% | |||||||||||||||||||
Retail Centers | 86.3 | % | 85.5 | % | (9.5 | )% | (17.4 | )% | 55.2 | % | 38.8 | % | 2.7 | % | (5.8 | )% | — | % | — | % | |||||||||||||||||||
Total | 22.1 | % | 9.3 | % | 11.6 | % | (1.9 | )% | 15.4 | % | 2.2 | % | 16.8 | % | 2.7 | % | 13.8 | % | (0.4 | )% | |||||||||||||||||||
Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | ||||||||||||||||||||||||||||||
Tenant Improvements | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 2,941,901 | $ | 44.87 | $ | 3,186,650 | $ | 41.79 | $ | 1,858,979 | $ | 40.11 | $ | 3,703,963 | $ | 50.14 | $ | 2,470,740 | $ | 47.87 | |||||||||||||||||||
Medical Office Buildings | 513,774 | 32.87 | 652,831 | 43.28 | 863,148 | 50.46 | 558,491 | 49.28 | 347,328 | 23.02 | |||||||||||||||||||||||||||||
Retail Centers | 2,307,500 | 50.05 | 168,500 | 11.69 | 120,000 | 15.27 | 1,436,054 | 31.50 | — | — | |||||||||||||||||||||||||||||
Subtotal | $ | 5,763,175 | $ | 45.27 | $ | 4,007,981 | $ | 37.90 | $ | 2,842,127 | $ | 39.85 | $ | 5,698,508 | $ | 43.57 | $ | 2,818,068 | $ | 42.25 | |||||||||||||||||||
Leasing Commissions and Incentives | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 2,041,020 | $ | 31.13 | $ | 1,569,078 | $ | 20.58 | $ | 1,113,305 | $ | 24.02 | $ | 2,569,373 | $ | 34.78 | $ | 1,542,133 | $ | 29.88 | |||||||||||||||||||
Medical Office Buildings | 223,311 | 14.29 | 327,649 | 21.72 | 212,409 | 12.42 | 155,136 | 13.69 | 117,431 | 7.78 | |||||||||||||||||||||||||||||
Retail Centers | 303,796 | 6.59 | 64,839 | 4.50 | 72,182 | 9.19 | 215,503 | 4.73 | — | — | |||||||||||||||||||||||||||||
Subtotal | $ | 2,568,127 | $ | 20.18 | $ | 1,961,566 | $ | 18.55 | $ | 1,397,896 | $ | 19.60 | $ | 2,940,012 | $ | 22.48 | $ | 1,659,564 | $ | 24.88 | |||||||||||||||||||
Tenant Improvements and Leasing Commissions and Incentives | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 4,982,921 | $ | 76.00 | $ | 4,755,728 | $ | 62.37 | $ | 2,972,284 | $ | 64.13 | $ | 6,273,336 | $ | 84.92 | $ | 4,012,873 | $ | 77.75 | |||||||||||||||||||
Medical Office Buildings | 737,085 | 47.16 | 980,480 | 65.00 | 1,075,557 | 62.88 | 713,627 | 62.97 | 464,759 | 30.80 | |||||||||||||||||||||||||||||
Retail Centers | 2,611,296 | 56.64 | 233,339 | 16.19 | 192,182 | 24.46 | 1,651,557 | 36.23 | — | — | |||||||||||||||||||||||||||||
Total | $ | 8,331,302 | $ | 65.45 | $ | 5,969,547 | $ | 56.45 | $ | 4,240,023 | $ | 59.45 | $ | 8,638,520 | $ | 66.05 | $ | 4,477,632 | $ | 67.13 | |||||||||||||||||||
20
Commercial Leasing Summary - Renewal Leases | |
1st Quarter 2013 | 4th Quarter 2012 | 3rd Quarter 2012 | 2nd Quarter 2012 | 1st Quarter 2012 | |||||||||||||||||||||||||||||||||||
Gross Leasing Square Footage | |||||||||||||||||||||||||||||||||||||||
Office Buildings | 192,943 | 76,772 | 99,101 | 44,425 | 84,619 | ||||||||||||||||||||||||||||||||||
Medical Office Buildings | 21,294 | 27,997 | 26,661 | 20,477 | 54,080 | ||||||||||||||||||||||||||||||||||
Retail Centers | 46,124 | 59,969 | 24,269 | 51,742 | 12,574 | ||||||||||||||||||||||||||||||||||
Total | 260,361 | 164,738 | 150,031 | 116,644 | 151,273 | ||||||||||||||||||||||||||||||||||
Weighted Average Term (yrs) | |||||||||||||||||||||||||||||||||||||||
Office Buildings | 2.7 | 3.9 | 3.9 | 4.0 | 4.2 | ||||||||||||||||||||||||||||||||||
Medical Office Buildings | 5.0 | 6.2 | 5.5 | 4.4 | 5.4 | ||||||||||||||||||||||||||||||||||
Retail Centers | 4.8 | 5.0 | 3.5 | 5.5 | 8.3 | ||||||||||||||||||||||||||||||||||
Total | 3.3 | 4.7 | 4.1 | 4.8 | 5.0 | ||||||||||||||||||||||||||||||||||
Rental Rate Increases: | GAAP | CASH | GAAP | CASH | GAAP | CASH | GAAP | CASH | GAAP | CASH | |||||||||||||||||||||||||||||
Rate on expiring leases | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 29.74 | $ | 31.56 | $ | 29.50 | $ | 30.46 | $ | 32.51 | $ | 34.52 | $ | 30.45 | $ | 32.60 | $ | 27.85 | $ | 29.24 | |||||||||||||||||||
Medical Office Buildings | 37.92 | 40.11 | 34.83 | 37.61 | 35.00 | 36.98 | 36.81 | 39.61 | 28.24 | 29.75 | |||||||||||||||||||||||||||||
Retail Centers | 28.27 | 29.13 | 19.73 | 19.97 | 39.16 | 40.36 | 15.86 | 16.48 | 14.13 | 14.13 | |||||||||||||||||||||||||||||
Total | $ | 30.15 | $ | 31.83 | $ | 26.85 | $ | 27.85 | $ | 34.03 | $ | 35.90 | $ | 24.57 | $ | 26.11 | $ | 26.85 | $ | 28.17 | |||||||||||||||||||
Rate on new leases | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 31.81 | $ | 31.40 | $ | 31.94 | $ | 30.90 | $ | 35.95 | $ | 34.43 | $ | 33.80 | $ | 32.25 | $ | 29.22 | $ | 27.95 | |||||||||||||||||||
Medical Office Buildings | 39.34 | 37.20 | 37.04 | 34.30 | 37.04 | 34.56 | 39.15 | 37.29 | 30.33 | 28.29 | |||||||||||||||||||||||||||||
Retail Centers | 30.40 | 29.32 | 21.48 | 21.15 | 42.86 | 41.65 | 18.00 | 16.83 | 15.13 | 14.24 | |||||||||||||||||||||||||||||
Total | $ | 32.18 | $ | 31.51 | $ | 29.00 | $ | 27.93 | $ | 37.26 | $ | 35.62 | $ | 27.20 | $ | 25.78 | $ | 28.45 | $ | 26.93 | |||||||||||||||||||
Percentage Increase | |||||||||||||||||||||||||||||||||||||||
Office Buildings | 7.0 | % | (0.5 | )% | 8.3 | % | 1.5 | % | 10.6 | % | (0.3 | )% | 11.0 | % | (1.1 | )% | 4.9 | % | (4.4 | )% | |||||||||||||||||||
Medical Office Buildings | 3.7 | % | (7.2 | )% | 6.4 | % | (8.8 | )% | 5.9 | % | (6.6 | )% | 6.3 | % | (5.9 | )% | 7.4 | % | (4.9 | )% | |||||||||||||||||||
Retail Centers | 7.5 | % | 0.7 | % | 8.9 | % | 6.0 | % | 9.5 | % | 3.2 | % | 13.5 | % | 2.1 | % | 7.1 | % | 0.8 | % | |||||||||||||||||||
Total | 6.7 | % | (1.0 | )% | 8.0 | % | 0.3 | % | 9.5 | % | (0.8 | )% | 10.7 | % | (1.3 | )% | 5.9 | % | (4.4 | )% | |||||||||||||||||||
Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | Total Dollars | $ per Sq Ft | ||||||||||||||||||||||||||||||
Tenant Improvements | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 1,035,279 | $ | 5.37 | $ | 801,452 | $ | 10.44 | $ | 1,155,918 | $ | 11.66 | $ | 575,040 | $ | 12.94 | $ | 467,573 | $ | 5.53 | |||||||||||||||||||
Medical Office Buildings | 189,280 | 8.89 | 520,981 | 18.61 | 347,034 | 13.02 | 225,037 | 10.99 | 873,239 | 16.15 | |||||||||||||||||||||||||||||
Retail Centers | — | — | — | — | — | — | 33,000 | 0.64 | — | — | |||||||||||||||||||||||||||||
Subtotal | $ | 1,224,559 | $ | 4.70 | $ | 1,322,433 | $ | 8.03 | $ | 1,502,952 | $ | 10.02 | $ | 833,077 | $ | 7.14 | $ | 1,340,812 | $ | 8.86 | |||||||||||||||||||
Leasing Commissions and Incentives | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 454,823 | $ | 2.35 | $ | 377,421 | $ | 4.92 | $ | 1,047,935 | $ | 10.57 | $ | 285,263 | $ | 6.42 | $ | 821,419 | $ | 9.71 | |||||||||||||||||||
Medical Office Buildings | 125,097 | 5.87 | 290,596 | 10.38 | 219,670 | 8.24 | 76,987 | 3.76 | 248,183 | 4.59 | |||||||||||||||||||||||||||||
Retail Centers | 75,176 | 1.63 | 29,104 | 0.49 | 23,021 | 0.95 | 41,593 | 0.80 | 9,232 | 0.73 | |||||||||||||||||||||||||||||
Subtotal | $ | 655,096 | $ | 2.52 | $ | 697,121 | $ | 4.23 | $ | 1,290,626 | $ | 8.60 | $ | 403,843 | $ | 3.46 | $ | 1,078,834 | $ | 7.13 | |||||||||||||||||||
Tenant Improvements and Leasing Commissions and Incentives | |||||||||||||||||||||||||||||||||||||||
Office Buildings | $ | 1,490,102 | $ | 7.72 | $ | 1,178,873 | $ | 15.36 | $ | 2,203,853 | $ | 22.23 | $ | 860,303 | $ | 19.36 | $ | 1,288,992 | $ | 15.24 | |||||||||||||||||||
Medical Office Buildings | 314,377 | 14.76 | 811,577 | 28.99 | 566,704 | 21.26 | 302,024 | 14.75 | 1,121,422 | 20.74 | |||||||||||||||||||||||||||||
Retail Centers | 75,176 | 1.63 | 29,104 | 0.49 | 23,021 | 0.95 | 74,593 | 1.44 | 9,232 | 0.73 | |||||||||||||||||||||||||||||
Total | $ | 1,879,655 | $ | 7.22 | $ | 2,019,554 | $ | 12.26 | $ | 2,793,578 | $ | 18.62 | $ | 1,236,920 | $ | 10.60 | $ | 2,419,646 | $ | 15.99 | |||||||||||||||||||
21
10 Largest Tenants - Based on Annualized Rent March 31, 2013 | |
Tenant | Number of Buildings | Weighted Average Remaining Lease Term in Months | Percentage of Aggregate Portfolio Annualized Rent | Aggregate Rentable Square Feet | Percentage of Aggregate Occupied Square Feet | ||||||||
World Bank | 1 | 27 | 5.11 | % | 210,354 | 2.92 | % | ||||||
Advisory Board Company | 1 | 74 | 2.88 | % | 180,925 | 2.51 | % | ||||||
Booz Allen Hamilton, Inc. | 1 | 34 | 2.35 | % | 222,989 | 3.10 | % | ||||||
Engility Corporation | 1 | 54 | 2.25 | % | 140,400 | 1.95 | % | ||||||
INOVA Health System | 7 | 36 | 2.08 | % | 114,917 | 1.60 | % | ||||||
Patton Boggs LLP | 1 | 49 | 2.05 | % | 110,566 | 1.54 | % | ||||||
Sunrise Assisted Living, Inc. | 1 | 15 | 1.66 | % | 115,289 | 1.60 | % | ||||||
General Services Administration | 4 | 50 | 1.33 | % | 66,170 | 0.92 | % | ||||||
General Dynamics | 2 | 15 | 1.22 | % | 88,359 | 1.23 | % | ||||||
Epstein, Becker & Green, P.C. | 1 | 45 | 1.14 | % | 53,427 | 0.74 | % | ||||||
Total/Weighted Average | 40 | 22.07 | % | 1,303,396 | 18.11 | % | |||||||
22
Industry Diversification March 31, 2013 | |
Industry Classification (NAICS) | Annualized Base Rental Revenue | Percentage of Aggregate Annualized Rent | Aggregate Rentable Square Feet | Percentage of Aggregate Square Feet | ||||||||
Professional, Scientific, and Technical Services | $ | 70,869,171 | 32.68 | % | 2,208,947 | 30.78 | % | |||||
Ambulatory Health Care Services | 39,095,068 | 18.03 | % | 1,125,728 | 15.69 | % | ||||||
Credit Intermediation and Related Activities | 17,157,266 | 7.91 | % | 328,478 | 4.58 | % | ||||||
Religious, Grantmaking, Civic, Professional, and Similar Organizations | 8,839,065 | 4.08 | % | 252,180 | 3.51 | % | ||||||
Food Services and Drinking Places | 8,160,417 | 3.76 | % | 265,936 | 3.71 | % | ||||||
Educational Services | 6,083,749 | 2.81 | % | 202,416 | 2.82 | % | ||||||
Food and Beverage Stores | 6,014,157 | 2.77 | % | 339,366 | 4.73 | % | ||||||
Executive, Legislative, and Other General Government Support | 5,884,246 | 2.71 | % | 169,583 | 2.36 | % | ||||||
Administrative and Support Services | 4,379,230 | 2.02 | % | 120,100 | 1.67 | % | ||||||
Nursing and Residential Care Facilities | 3,847,552 | 1.77 | % | 121,649 | 1.70 | % | ||||||
Health and Personal Care Stores | 3,573,142 | 1.65 | % | 105,503 | 1.47 | % | ||||||
Broadcasting (except Internet) | 3,270,154 | 1.51 | % | 89,702 | 1.25 | % | ||||||
Miscellaneous Store Retailers | 3,108,068 | 1.43 | % | 167,668 | 2.34 | % | ||||||
Furniture and Home Furnishings Stores | 3,057,391 | 1.41 | % | 154,256 | 2.15 | % | ||||||
Electronics and Appliance Stores | 2,917,375 | 1.35 | % | 166,290 | 2.32 | % | ||||||
Sporting Goods, Hobby, Book, and Music Stores | 2,837,386 | 1.31 | % | 171,094 | 2.38 | % | ||||||
Personal and Laundry Services | 2,753,530 | 1.27 | % | 84,633 | 1.18 | % | ||||||
Clothing and Clothing Accessories Stores | 2,704,361 | 1.25 | % | 135,625 | 1.89 | % | ||||||
Amusement, Gambling, and Recreation Industries | 1,982,321 | 0.91 | % | 99,338 | 1.38 | % | ||||||
Hospitals | 1,884,459 | 0.87 | % | 50,376 | 0.70 | % | ||||||
General Merchandise Stores | 1,875,727 | 0.87 | % | 221,503 | 3.09 | % | ||||||
Real Estate | 1,436,801 | 0.66 | % | 44,355 | 0.62 | % | ||||||
Publishing Industries (except Internet) | 1,372,915 | 0.63 | % | 46,655 | 0.65 | % | ||||||
Telecommunications | 1,326,962 | 0.61 | % | 35,227 | 0.49 | % | ||||||
Securities, Commodity Contracts, and Other Financial Investments and Related Activities | 1,228,696 | 0.57 | % | 41,951 | 0.58 | % | ||||||
Printing and Related Support Activities | 1,207,035 | 0.56 | % | 48,775 | 0.68 | % | ||||||
23
Industry Diversification (continued) March 31, 2013 | |
Industry Classification (NAICS) | Annualized Base Rental Revenue | Percentage of Aggregate Annualized Rent | Aggregate Rentable Square Feet | Percentage of Aggregate Square Feet | |||||||
Computer and Electronic Product Manufacturing | 1,202,988 | 0.56 | % | 41,689 | 0.58 | % | |||||
Transportation Equipment Manufacturing | 791,160 | 0.37 | % | 28,851 | 0.40 | % | |||||
Construction of Buildings | 768,089 | 0.35 | % | 26,274 | 0.37 | % | |||||
Insurance Carriers and Related Activities | 646,148 | 0.30 | % | 21,592 | 0.30 | % | |||||
Merchant Wholesalers, Durable Goods | 626,953 | 0.29 | % | 37,275 | 0.52 | % | |||||
Social Assistance | 590,960 | 0.27 | % | 19,241 | 0.27 | % | |||||
Motor Vehicle and Parts Dealers | 541,836 | 0.25 | % | 32,256 | 0.45 | % | |||||
Merchant Wholesalers, Nondurable Goods | 453,827 | 0.21 | % | 27,786 | 0.39 | % | |||||
Other | 4,337,293 | 2.00 | % | 144,541 | 2.00 | % | |||||
Total | 216,825,498 | 100.00 | % | 7,176,839 | 100.00 | % | |||||
24
Lease Expirations March 31, 2013 | |
Year | Number of Leases | Rentable Square Feet | Percent of Rentable Square Feet | Annualized Rent * | Average Rental Rate | Percent of Annualized Rent * | |||||||||||||
Office: | |||||||||||||||||||
2013 | 82 | 323,670 | 7.75 | % | $ | 10,086,317 | $ | 31.16 | 6.51 | % | |||||||||
2014 | 101 | 893,860 | 21.39 | % | 30,761,075 | 34.41 | 19.85 | % | |||||||||||
2015 | 94 | 541,631 | 12.96 | % | 22,245,205 | 41.07 | 14.36 | % | |||||||||||
2016 | 84 | 577,898 | 13.83 | % | 18,283,724 | 31.64 | 11.80 | % | |||||||||||
2017 | 68 | 509,789 | 12.20 | % | 20,026,447 | 39.28 | 12.92 | % | |||||||||||
2018 and thereafter | 168 | 1,331,741 | 31.87 | % | 53,549,890 | 40.21 | 34.56 | % | |||||||||||
597 | 4,178,589 | 100.00 | % | $ | 154,952,658 | 37.08 | 100.00 | % | |||||||||||
Medical Office: | |||||||||||||||||||
2013 | 46 | 137,131 | 12.36 | % | $ | 4,803,310 | 35.03 | 10.76 | % | ||||||||||
2014 | 53 | 157,709 | 14.21 | % | 6,184,316 | 39.21 | 13.85 | % | |||||||||||
2015 | 32 | 88,185 | 7.95 | % | 3,559,891 | 40.37 | 7.97 | % | |||||||||||
2016 | 46 | 146,900 | 13.24 | % | 5,741,354 | 39.08 | 12.86 | % | |||||||||||
2017 | 42 | 129,789 | 11.70 | % | 5,283,624 | 40.71 | 11.83 | % | |||||||||||
2018 and thereafter | 116 | 449,997 | 40.54 | % | 19,074,686 | 42.39 | 42.73 | % | |||||||||||
335 | 1,109,711 | 100.00 | % | $ | 44,647,181 | 40.23 | 100.00 | % | |||||||||||
Retail: | |||||||||||||||||||
2013 | 39 | 290,404 | 13.70 | % | $ | 3,944,199 | 13.58 | 8.47 | % | ||||||||||
2014 | 42 | 142,382 | 6.72 | % | 3,238,974 | 22.75 | 6.95 | % | |||||||||||
2015 | 47 | 344,561 | 16.26 | % | 7,026,376 | 20.39 | 15.09 | % | |||||||||||
2016 | 25 | 199,264 | 9.40 | % | 4,199,335 | 21.07 | 9.02 | % | |||||||||||
2017 | 37 | 236,367 | 11.15 | % | 6,612,610 | 27.98 | 14.20 | % | |||||||||||
2018 and thereafter | 102 | 906,121 | 42.77 | % | 21,557,958 | 23.79 | 46.27 | % | |||||||||||
292 | 2,119,099 | 100.00 | % | $ | 46,579,452 | 21.98 | 100.00 | % | |||||||||||
Total: | |||||||||||||||||||
2013 | 167 | 751,205 | 10.14 | % | $ | 18,833,826 | 25.07 | 7.65 | % | ||||||||||
2014 | 196 | 1,193,951 | 16.12 | % | 40,184,365 | 33.66 | 16.32 | % | |||||||||||
2015 | 173 | 974,377 | 13.15 | % | 32,831,472 | 33.69 | 13.34 | % | |||||||||||
2016 | 155 | 924,062 | 12.48 | % | 28,224,413 | 30.54 | 11.47 | % | |||||||||||
2017 | 147 | 875,945 | 11.83 | % | 31,922,681 | 36.44 | 12.97 | % | |||||||||||
2018 and thereafter | 386 | 2,687,859 | 36.28 | % | 94,182,534 | 35.04 | 38.25 | % | |||||||||||
1,224 | 7,407,399 | 100.00 | % | $ | 246,179,291 | 33.23 | 100.00 | % | |||||||||||
Note: Lease expiration data exclude properties classified as sold or held for sale. | |||||||||||||||||||
* Annualized Rent is equal to the rental rate effective at lease expiration (cash basis) multiplied by 12. | |||||||||||||||||||
25
Schedule of Properties March 31, 2013 | |
PROPERTIES | LOCATION | YEAR ACQUIRED | YEAR CONSTRUCTED | NET RENTABLE SQUARE FEET | |||||
Office Buildings | |||||||||
1901 Pennsylvania Avenue | Washington, DC | 1977 | 1960 | 100,000 | |||||
51 Monroe Street | Rockville, MD | 1979 | 1975 | 212,000 | |||||
515 King Street | Alexandria, VA | 1992 | 1966 | 75,000 | |||||
6110 Executive Boulevard | Rockville, MD | 1995 | 1971 | 202,000 | |||||
1220 19th Street | Washington, DC | 1995 | 1976 | 103,000 | |||||
1600 Wilson Boulevard | Arlington, VA | 1997 | 1973 | 167,000 | |||||
7900 Westpark Drive | McLean, VA | 1997 | 1972/1986/1999 | 528,000 | |||||
600 Jefferson Plaza | Rockville, MD | 1999 | 1985 | 113,000 | |||||
Wayne Plaza | Silver Spring, MD | 2000 | 1970 | 96,000 | |||||
Courthouse Square | Alexandria, VA | 2000 | 1979 | 115,000 | |||||
One Central Plaza | Rockville, MD | 2001 | 1974 | 267,000 | |||||
1776 G Street | Washington, DC | 2003 | 1979 | 263,000 | |||||
6565 Arlington Boulevard | Falls Church, VA | 2006 | 1967/1998 | 135,000 | |||||
West Gude Drive | Rockville, MD | 2006 | 1984/1986/1988 | 277,000 | |||||
Monument II | Herndon, VA | 2007 | 2000 | 207,000 | |||||
Woodholme Center | Pikesville, MD | 2007 | 1989 | 74,000 | |||||
2000 M Street | Washington, DC | 2007 | 1971 | 228,000 | |||||
2445 M Street | Washington, DC | 2008 | 1986 | 290,000 | |||||
925 Corporate Drive | Stafford, VA | 2010 | 2007 | 134,000 | |||||
1000 Corporate Drive | Stafford, VA | 2010 | 2009 | 136,000 | |||||
1140 Connecticut Avenue | Washington, DC | 2011 | 1966 | 188,000 | |||||
1227 25th Street | Washington, DC | 2011 | 1988 | 132,000 | |||||
Braddock Metro Center | Alexandria, VA | 2011 | 1985 | 344,000 | |||||
John Marshall II | Tysons Corner, VA | 2011 | 1996/2010 | 223,000 | |||||
Fairgate at Ballston | Arlington, VA | 2012 | 1988 | 138,000 | |||||
Subtotal | 4,747,000 | ||||||||
26
Schedule of Properties (continued) March 31, 2013 | |
PROPERTIES | LOCATION | YEAR ACQUIRED | YEAR CONSTRUCTED | NET RENTABLE SQUARE FEET | |||||
Medical Office Buildings | |||||||||
Woodburn Medical Park I | Annandale, VA | 1998 | 1984 | 73,000 | |||||
Woodburn Medical Park II | Annandale, VA | 1998 | 1988 | 96,000 | |||||
Prosperity Medical Center I | Merrifield, VA | 2003 | 2000 | 93,000 | |||||
Prosperity Medical Center II | Merrifield, VA | 2003 | 2001 | 89,000 | |||||
Prosperity Medical Center III | Merrifield, VA | 2003 | 2002 | 75,000 | |||||
Shady Grove Medical Village II | Rockville, MD | 2004 | 1999 | 66,000 | |||||
8301 Arlington Boulevard | Fairfax, VA | 2004 | 1965 | 53,000 | |||||
Alexandria Professional Center | Alexandria, VA | 2006 | 1968 | 117,000 | |||||
9707 Medical Center Drive | Rockville, MD | 2006 | 1994 | 39,000 | |||||
15001 Shady Grove Road | Rockville, MD | 2006 | 1999 | 51,000 | |||||
15005 Shady Grove Road | Rockville, MD | 2006 | 2002 | 51,000 | |||||
2440 M Street | Washington, DC | 2007 | 1986/2006 | 113,000 | |||||
Woodholme Medical Office Building | Pikesville, MD | 2007 | 1996 | 130,000 | |||||
Ashburn Office Park | Ashburn, VA | 2007 | 1998/2000/2002 | 75,000 | |||||
CentreMed I & II | Centreville, VA | 2007 | 1998 | 53,000 | |||||
Sterling Medical Office Building | Sterling, VA | 2008 | 1986/2000 | 36,000 | |||||
19500 at Riverside Office Park (formerly Lansdowne Medical Office Building) | Leesburg, VA | 2009 | 2009 | 87,000 | |||||
Subtotal | 1,297,000 | ||||||||
27
Schedule of Properties (continued) March 31, 2013 | |
PROPERTIES | LOCATION | YEAR ACQUIRED | YEAR CONSTRUCTED | NET RENTABLE SQUARE FEET (1) | |||||
Retail Centers | |||||||||
Takoma Park | Takoma Park, MD | 1963 | 1962 | 51,000 | |||||
Westminster | Westminster, MD | 1972 | 1969 | 150,000 | |||||
Concord Centre | Springfield, VA | 1973 | 1960 | 76,000 | |||||
Wheaton Park | Wheaton, MD | 1977 | 1967 | 73,000 | |||||
Bradlee Shopping Center | Alexandria, VA | 1984 | 1955 | 168,000 | |||||
Chevy Chase Metro Plaza | Washington, DC | 1985 | 1975 | 49,000 | |||||
Montgomery Village Center | Gaithersburg, MD | 1992 | 1969 | 195,000 | |||||
Shoppes of Foxchase | Alexandria, VA | 1994 | 1960 | 134,000 | |||||
Frederick County Square | Frederick, MD | 1995 | 1973 | 227,000 | |||||
800 S. Washington Street | Alexandria, VA | 1998/2003 | 1955/1959 | 47,000 | |||||
Centre at Hagerstown | Hagerstown, MD | 2002 | 2000 | 332,000 | |||||
Frederick Crossing | Frederick, MD | 2005 | 1999/2003 | 295,000 | |||||
Randolph Shopping Center | Rockville, MD | 2006 | 1972 | 82,000 | |||||
Montrose Shopping Center | Rockville, MD | 2006 | 1970 | 145,000 | |||||
Gateway Overlook | Columbia, MD | 2010 | 2007 | 223,000 | |||||
Olney Village Center | Olney, MD | 2011 | 1979/2003 | 198,000 | |||||
Subtotal | 2,445,000 | ||||||||
Multifamily Buildings / # units | |||||||||
3801 Connecticut Avenue / 308 | Washington, DC | 1963 | 1951 | 179,000 | |||||
Roosevelt Towers / 191 | Falls Church, VA | 1965 | 1964 | 170,000 | |||||
Country Club Towers / 227 | Arlington, VA | 1969 | 1965 | 159,000 | |||||
Park Adams / 200 | Arlington, VA | 1969 | 1959 | 173,000 | |||||
Munson Hill Towers / 279 | Falls Church, VA | 1970 | 1963 | 258,000 | |||||
The Ashby at McLean / 256 | McLean, VA | 1996 | 1982 | 274,000 | |||||
Walker House Apartments / 212 | Gaithersburg, MD | 1996 | 1971/2003 | 157,000 | |||||
Bethesda Hill Apartments / 195 | Bethesda, MD | 1997 | 1986 | 225,000 | |||||
Bennett Park / 224 | Arlington, VA | 2007 | 2007 | 214,000 | |||||
Clayborne / 74 | Alexandria, VA | 2008 | 2008 | 60,000 | |||||
Kenmore Apartments / 374 | Washington, DC | 2008 | 1948 | 268,000 | |||||
Subtotal (2,540 units) | 2,137,000 | ||||||||
TOTAL | 10,626,000 | ||||||||
(1) Multifamily buildings are presented in gross square feet. | |||||||||
28
Supplemental Definitions March 31, 2013 | |
Adjusted EBITDA (a non-GAAP measure) is earnings attributable to the controlling interest before interest expense, taxes, depreciation, amortization, real estate impairment, gain on sale of real estate, gain/loss on extinguishment of debt and gain/loss from non-disposal activities. |
Annualized base rent ("ABR") is calculated as monthly base rent (cash basis) per the lease, as of the reporting period, multiplied by 12. |
Debt service coverage ratio is computed by dividing earnings attributable to the controlling interest before interest expense, taxes, depreciation, amortization, real estate impairment, gain on sale of real estate, gain/loss on extinguishment of debt and gain/loss from non-disposal activities by interest expense (including interest expense from discontinued operations) and principal amortization. |
Debt to total market capitalization is total debt divided by the sum of total debt plus the market value of shares outstanding at the end of the period. |
Earnings to fixed charges ratio is computed by dividing earnings attributable to the controlling interest by fixed charges. For this purpose, earnings consist of income from continuing operations (or net income if there are no discontinued operations) plus fixed charges, less capitalized interest. Fixed charges consist of interest expense (excluding interest expense from discontinued operations), including amortized costs of debt issuance, plus interest costs capitalized. |
Economic occupancy is calculated as actual real estate rental revenue recognized for the period indicated as a percentage of gross potential real estate rental revenue for that period. We determine gross potential real estate rental revenue by valuing occupied units or square footage at contract rates and vacant units or square footage at market rates for comparable properties. We do not consider percentage rents and expense reimbursements in computing economic occupancy percentages. |
Funds from operations ("FFO") is defined by The National Association of Real Estate Investment Trusts, Inc. (“NAREIT”) in an April, 2002 White Paper as net income (computed in accordance with generally accepted accounting principles (“GAAP”)) excluding gains (or losses) associated with sales of property and impairment of depreciable real estate, plus real estate depreciation and amortization. We consider FFO to be a standard supplemental measure for equity real estate investment trusts (“REITs”) because it facilitates an understanding of the operating performance of our properties without giving effect to real estate depreciation and amortization, which historically assumes that the value of real estate assets diminishes predictably over time. Since real estate values have instead historically risen or fallen with market conditions, we believe that FFO more accurately provides investors an indication of our ability to incur and service debt, make capital expenditures and fund other needs. FFO is a non-GAAP measure. |
Core Funds From Operations ("Core FFO") is calculated by adjusting FFO for the following items (which we believe are not indicative of the performance of WRIT’s operating portfolio and affect the comparative measurement of WRIT’s operating performance over time): (1) gains or losses on extinguishment of debt, (2) costs related to the acquisition of properties, (3) severance expense related to corporate reorganization and related to the CEO's retirement and (4) property impairments not already excluded from FFO, as appropriate. These items can vary greatly from period to period, depending upon the volume of our acquisition activity and debt retirements, among other factors. We believe that by excluding these items, Core FFO serves as a useful, supplementary measure of WRIT’s ability to incur and service debt, and distribute dividends to its shareholders. Core FFO is a non-GAAP and non-standardized measure, and may be calculated differently by other REITs. |
Funds Available for Distribution ("FAD") is calculated by subtracting from FFO (1) recurring expenditures, tenant improvements and leasing costs, that are capitalized and amortized and are necessary to maintain our properties and revenue stream and (2) straight line rents, then adding (3) non-real estate depreciation and amortization, (4) non-cash fair value interest expense and (5) amortization of restricted share compensation, then adding or subtracting the (6) amortization of lease intangibles , (7) real estate impairment and (8) non-cash gain/loss on extinguishment of debt, as appropriate. FAD is included herein, because we consider it to be a measure of a REIT’s ability to incur and service debt and to distribute dividends to its shareholders. FAD is a non-GAAP and non-standardized measure, and may be calculated differently by other REITs. |
Core Funds Available for Distribution ("Core FAD") is calculated by adjusting FAD for the following items (which we believe are not indicative of the performance of WRIT’s operating portfolio and affect the comparative measurement of WRIT’s operating performance over time): (1) gains or losses on extinguishment of debt, (2) costs related to the acquisition of properties, (3) non-share-based severance expense related to corporate reorganization and related to the CEO's retirement not already excluded from FAD and (4) property impairments not already excluded from FAD, as appropriate. These items can vary greatly from period to period, depending upon the volume of our acquisition activity and debt retirements, among other factors. We believe that by excluding these items, Core FAD serves as a useful, supplementary measure of WRIT’s ability to incur and service debt, and distribute dividends to its shareholders. Core FAD is a non-GAAP and non-standardized measure, and may be calculated differently by other REITs. |
Physical occupancy is calculated as occupied square footage as a percentage of total square footage as of the last day of that period. |
Recurring capital expenditures represent non-accretive building improvements and leasing costs required to maintain current revenues. Recurring capital expenditures do not include acquisition capital that was taken into consideration when underwriting the purchase of a building or which are incurred to bring a building up to "operating standard." |
Rent increases on renewals and rollovers are calculated as the difference, weighted by square feet, of the net ABR due the first month after a term commencement date and the net ABR due the last month prior to the termination date of the former tenant's term. |
Same-store portfolio properties include all properties that were owned for the entirety of the current and prior year reporting periods. |
Same-store portfolio net operating income (NOI) growth is the change in the NOI of the same-store portfolio properties from the prior reporting period to the current reporting period. |
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