Exhibit 99.2

				Supplemental Information		Second Quarter 2013

 

 

 

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Chambers Street Properties

 

		Page
Forward Looking Statements			2
Financial Highlights			4
Consolidated Balance Sheets			5
Consolidated Statements of Operations			7
Condensed Consolidated Statements of Cash Flows			8
Reconciliation of Net (Loss) Income to FFO, Core FFO and AFFO			10
Joint Venture Balance Sheets			11
Joint Venture Statements of Operations			12
Consolidated & Pro Rata Share Balance Sheets			13
Consolidated & Pro Rata Share Statements of Operations			14
Our Properties			16
Property Distribution and Types			21
Geographic Distribution			22
Significant Tenants			23
Tenant Industries			24
Tenant Lease Expirations			25
Debt Maturities			26
Fixed and Floating Rate Debt			27
Encumbered and Unencumbered Properties			28
Non-GAAP Supplemental Financial Measures			29

 

Supplemental Information  |  Second Quarter 2013  |  1

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This supplemental information is available on the Company’s website at www.chambersstreet.com. This data is furnished to supplement audited and unaudited regulatory filings of the Company and should be read in conjunction with those filings. The financial data herein is unaudited and is provided from the perspective of timeliness to assist readers of quarterly and annual financial filings. As such, data otherwise contained in future regulatory filings covering the same period may restate the data presented herein.

Forward-Looking Statements

This supplemental information may contain various “forward-looking statements.” You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “would,” “could,” “should,” “seeks,” “approximately,” “intends,” “plans,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Statements regarding the following subjects may be impacted by a number of risks and uncertainties such as our business strategy; our ability to obtain future financing arrangements; estimates relating to our future distributions; our understanding of our competition; market trends; projected capital expenditures; the impact of technology on our products, operations and business; and the use of the proceeds of any offerings of securities. The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. These beliefs, assumptions and expectations are subject to risks and uncertainties and can change as a result of many possible events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. You should carefully consider these risks before you make an investment decision with respect to our common shares, along with the following factors that could cause actual results to vary from our forward-looking statements such as: general volatility of the securities markets in which we participate; national, regional and local economic climates; changes in supply and demand for office and industrial properties; adverse changes in the real estate markets, including increasing vacancy, decreasing rental revenue and increasing insurance costs; availability and credit worthiness of prospective tenants; our ability to maintain rental rates and maximize occupancy; our ability to identify and secure acquisitions; our failure to successfully manage growth or operate acquired properties; our pace of acquisitions and/or dispositions of properties; risks related to development projects (including construction delay, cost overruns or our inability to obtain necessary permits); payment of distributions from sources other than cash flows and operating activities; receiving corporate debt ratings and changes in the general interest rate environment; availability of capital (debt and equity); our ability to refinance existing indebtedness or incur additional indebtedness; failure to comply with our debt covenants; unanticipated increases in financing and other costs, including a rise in interest rates; the actual outcome of the resolution of any conflict; material adverse actions or omissions by any of our joint venture partners; our ability to operate as a self-managed company; availability of and ability to retain our executive officers and other qualified personnel; future terrorist attacks in the United States or abroad; the ability of our operating partnership to continue to qualify as a partnership for U.S. federal income tax purposes; our ability to continue to qualify as a REIT for U.S. federal income tax purposes; foreign currency fluctuations; changes to accounting principles, policies and guidelines applicable to REITs; legislative or regulatory changes adversely affecting REITs and the real estate business; and environmental, regulatory and/or safety requirements. The foregoing

 

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review of important factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein and elsewhere, including the risk factors included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2013 and other documents of the Company on file with or furnished to the SEC. Any forward looking statements made in this press release are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company or its business or operations. Except as required by law, the Company undertakes no obligation to update publicly or revise any forward looking statement, whether as a result of new information, future developments or otherwise. We caution you that actual outcomes and results may differ materially from what is expressed, implied or forecast by our forward looking statements.

The following discussion related to the consolidated financial statements of the Company should be read in conjunction with the financial statements for the quarter ended June 30, 2013 that will be released on Form 10-Q to be filed on or before August 14, 2013.

 

Supplemental Information  |  Second Quarter 2013  |  3

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CHAMBERS STREET PROPERTIES

Financial Highlights

(unaudited)

($ In Thousands, Except Share Data)

 

		6/30/13				3/31/13				12/31/12				9/30/12				6/30/12
Consolidated Balance Sheet Items:
Net Investments in Real Estate			$2,078,960				$2,093,171				$1,600,811				$1,496,994				$1,448,482
Total Assets			2,869,748				2,866,877				2,554,862				2,481,611				2,529,088
Total Notes and Loans Payable			1,208,593				1,046,840				767,232				628,483				656,400
Total Liabilities			1,338,482				1,181,915				894,039				773,379				774,630
Non-Controlling Interests			2,664				2,664				2,664				2,664				2,664
Shareholders’ Equity			1,528,602				1,682,298				1,657,333				1,704,742				1,750,968
Portfolio Statistics:
Number of Properties (1)			129				129				129				124				124
Total Net Rentable Square Feet (2)			34,153,941				34,062,119				34,062,119				30,828,045				29,781,045
Approximate Total Acquisition Cost (3)			$3,286,756				$3,286,717				$3,141,539				$2,928,464				$2,850,112
Percentage Leased (3)(4)			95.53	%			96.99	%			97.80	%			98.10	%			98.45	%

 

		Three Months Ended June 30,								Six Months Ended June 30,
Income & Cash Flow Items:		2013				2012				2013				2012
Total Revenues			$67,110				$44,886				$121,062				$88,285
Net (Loss) Income			(3,640)				(1,899)				78,450				(4,053)
Net Cash Flows Provided By Operating Activities			24,904				25,043				55,048				56,430
Funds from Operations (FFO) (5)			32,990				29,220				70,173				58,111
Core Funds from Operations (Core FFO) (5)			40,936				31,556				78,379				62,527
Adjusted Funds from Operations (AFFO) (5)			34,590				27,641				70,077				55,175
Distributions Declared			37,272				36,726				72,758				74,092
Weighted Average Common Shares Outstanding - Basic & Diluted			248,224,851				249,117,722				248,350,481				246,983,416
Per Share Data:
Net (Loss) Income			$(0.01)				$(0.01)				$0.32				$(0.02)
FFO (5)			$0.13				$0.12				$0.28				$0.24
Core FFO (5)			$0.16				$0.13				$0.32				$0.25
AFFO (5)			$0.14				$0.11				$0.28				$0.22
Distributions Declared			$0.15				$0.15				$0.30				$0.30

 

(1)	Number of properties include indirect interests in properties owned by our joint ventures.

(2)	Includes 100% of unconsolidated joint venture amounts.

(3)	Includes pro rata share of unconsolidated joint venture amounts.

(4)	Average percentage leased is weighted based on net rentable square feet.

(5)	Please refer to page 10 for a reconciliation of GAAP Net (Loss) Income to FFO, Core FFO and AFFO.

 

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CHAMBERS STREET PROPERTIES

Consolidated Balance Sheets

as of June 30, 2013 and December 31, 2012

(In Thousands, Except Share Data)

 

		June 30,      2013				December 31, 2012
		(unaudited)
ASSETS
Investments in Real Estate:
Land			$442,600				$378,806
Site Improvements			204,734				181,816
Building and Improvements			1,458,710				1,091,639
Tenant Improvements			135,317				80,679
			2,241,361				1,732,940
Less: Accumulated Depreciation and Amortization			(162,401)				(132,129)
Net Investment in Real Estate			2,078,960				1,600,811
Investment in Unconsolidated Entities			361,004				515,829
Construction in Progress and Other Assets - Variable Interest Entity			-				76,826
Cash and Cash Equivalents			87,861				107,355
Restricted Cash			15,655				10,998
Accounts and Other Receivables, Net			9,830				6,675
Deferred Rent			29,715				25,210
Acquired Above-Market Leases, Net			47,322				31,855
Acquired In-Place Lease Value, Net			214,648				162,558
Deferred Financing Costs, Net			8,837				8,322
Lease Commissions, Net			4,462				4,645
Other Assets			7,111				3,778
Interest Rate Swaps at Fair Value - Qualifying Hedge			4,343				-
Total Assets			$2,869,748				$2,554,862

 

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CHAMBERS STREET PROPERTIES

Consolidated Balance Sheets (continued)

as of June 30, 2013 and December 31, 2012

(In Thousands, Except Share Data)

 

		June 30,      2013				December 31, 2012
		(unaudited)
LIABILITIES, NON-CONTROLLING INTEREST AND SHAREHOLDERS’ EQUITY
LIABILITIES
Notes Payable, Net			$689,797				$492,944
Notes Payable at Fair Value			8,753				9,288
Loan Payable			510,044				265,000
Security Deposits			2,122				1,811
Accounts Payable, Accrued Expenses and Other Liabilities			55,614				24,531
Accounts Payable, Accrued Expenses and Prepaid Rent- Variable Interest Entity			-				24,531
Acquired Below-Market Leases, Net			33,687				24,582
Above-Market Ground Lease Obligation, Net			1,376				1,412
Property Management Fee Payable to Related Party			124				384
Investment Management Fee Payable to Related Party			-				10,700
Distributions Payable			35,486				37,418
Interest Rate Swaps at Fair Value - Non-Qualifying Hedge			83				423
Interest Rate Swaps at Fair Value - Qualifying Hedge			1,396				1,015
Total Liabilities			1,338,482				894,039
COMMITMENTS AND CONTINGENCIES
NON-CONTROLLING INTEREST
Operating Partnership Units			2,464				2,464
Class B Operating Partnership Unit			200				200
Non-Controlling Interest - Variable Interest Entity			-				826
SHAREHOLDERS’ EQUITY
Common Shares of Beneficial Interest, $.01 par value, 990,000,000 shares authorized; 236,948,214 and 249,664,156 issued and outstanding as of June 30, 2013 and December 31, 2012, respectively			2,365				2,494
Additional Paid-in-Capital			2,072,930				2,203,888
Accumulated Deficit			(534,849)				(540,462)
Accumulated Other Comprehensive Loss			(11,844)				(8,587)
Total Shareholders’ Equity			1,528,602				1,657,333
Total Liabilities, Non-Controlling Interest and Shareholders’ Equity			$2,869,748				$2,554,862

 

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CHAMBERS STREET PROPERTIES

Consolidated Statements of Operations

For the Three and Six Months Ended June 30, 2013 and 2012 (unaudited)

(In Thousands, Except Share Data)

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2013				2012				2013				2012
REVENUES
Rental			$51,110				$36,568				$95,150				$71,887
Tenant Reimbursements			16,000				8,318				25,912				16,398
Total Revenues			67,110				44,886				121,062				88,285
EXPENSES
Operating & Maintenance			7,298				4,833				13,084				9,941
Property Taxes			11,307				5,410				18,781				10,786
Interest			10,482				8,711				19,786				17,467
General and Administrative			7,576				2,269				12,710				4,434
Property Management Fee to Related Party			286				390				520				772
Investment Management Fee to Related Party			(11)				6,150				489				12,111
Acquisition			162				31				2,004				1,409
Depreciation and Amortization			26,770				17,985				48,774				35,961
Transition Costs			693				1,936				728				1,936
Listing			10,506				-				10,506				-
Total Expenses			75,069				47,715				127,382				94,817
OTHER INCOME AND EXPENSES
Interest and Other Income			280				485				487				1,545
Net Settlement Payments on Interest Rate Swaps			(704)				(164)				(1,047)				(324)
Gain on Interest Rate Swaps			2,383				122				1,466				246
Loss on Notes Payable at Fair Value			(32)				(25)				(57)				(60)
Total Other Income			1,927				418				849				1,407
LOSS BEFORE PROVISION FOR INCOME TAXES AND EQUITY IN INCOME OF UNCONSOLIDATED ENTITIES			(6,032)				(2,411)				(5,471)				(5,125)
PROVISION FOR INCOME TAXES			(151)				(160)				(220)				(142)
EQUITY IN INCOME OF UNCONSOLIDATED ENTITIES			2,575				1,087				6,939				1,629
(LOSS) GAIN ON CONVERSION OF EQUITY INTEREST TO CONTROLLING INTEREST			(32)				-				77,202				-
NET (LOSS) INCOME FROM CONTINUING OPERATIONS			(3,640)				(1,484)				78,450				(3,638)
DISCONTINUED OPERATIONS
Loss on Write Down to Net Sales Value			-				(415)				-				(415)
LOSS FROM DISCONTINUED OPERATIONS			-				(415)				-				(415)
NET (LOSS) INCOME			(3,640)				(1,899)				78,450				(4,053)
Net Income (Loss) Attributable to Non-Controlling Operating Partnership Units			4				-				(79)				2
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS			$(3,636)				$(1,899)				$78,371				$(4,051)
Basic and Diluted Net (Loss) Income per Share - Attributable to Common Shareholders			$(0.01)				$(0.01)				$0.32				$(0.02)
Weighted Average Common Shares Outstanding - Basic & Diluted			248,224,851				249,117,722				248,350,481				246,983,416
Dividends Declared Per Share			$0.15				$0.15				$0.30				$0.30

 

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CHAMBERS STREET PROPERTIES

Condensed Consolidated Statements of Cash Flows

For the Six Months Ended June 30, 2013 and 2012 (unaudited)

(In Thousands)

 

		Six Months Ended June 30,
		2013				2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)			$78,450				$(4,053)
Adjustments to Reconcile Net (Loss) Income to Net Cash Flows
Provided by Operating Activities:
Equity in Income of Unconsolidated Entities			(6,939)				(1,629)
Distributions from Unconsolidated Entities			19,689				21,185
Gain on Interest Rate Swaps			(1,466)				(246)
Loss on Note Payable at Fair Value			57				60
Loss on Sale of Discontinued Operations			-				415
Gain on Conversion of Equity Investment to Controlling Interest			(77,202)				-
Depreciation and Amortization of Building and Improvements			30,810				21,519
Amortization of Deferred Financing Costs			1,380				949
Amortization of Acquired In-Place Lease Value			17,502				14,123
Amortization of Above and Below-Market Leases			3,071				1,501
Amortization of Lease Commissions			462				319
Amortization of Discount and Premium on Notes Payable			(1,655)				(651)
Share Based Compensation			4,556				200
Changes in Assets and Liabilities:
Accounts and Other Receivables			(3,155)				(812)
Deferred Rent			(4,505)				(3,762)
Other Assets			(4,374)				(334)
Accounts Payable and Accrued Expenses			9,327				7,320
Investment Management & Property Management Fees Payable to Related Party			(10,960)				326
Net Cash Flows Provided By Operating Activities			55,048				56,430
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of Real Estate Property			(63,101)				(64,340)
Investments in Unconsolidated Entities			-				(12,793)
Distributions from Unconsolidated Entities			-				2,400
Restricted Cash			(4,657)				(2,934)
Lease Commissions			(287)				(684)
Improvements - Variable Interest Entity			(3,601)				(26,361)
Improvements to Investments in Real Estate			(4,961)				(1,985)
Net Cash Flows Used in Investing Activities			(76,607)				(106,697)

 

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CHAMBERS STREET PROPERTIES

Condensed Consolidated Statements of Cash Flows (continued)

For the Six Months Ended June 30, 2013 and 2012 (unaudited)

(In Thousands)

 

		Six Months Ended June 30,
		2013				2012
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Common Stocks - Public Offering			-				172
Proceeds from Additional Paid-in-Capital - Public Offering			-				171,086
Redemption of Common Shares			(44,225)				(19,621)
Repurchase and Cancellation of Common Shares			(125,000)				-
Payment of Offering Costs			-				(20,440)
Payment of Distributions			(41,111)				(37,997)
Distributions to Non-Controlling Interest - Operating Partnership Units			(74)				(74)
Contribution from Non-Controlling Interest - Variable Interest Entity			-				140
Distribution to Non-Controlling Interest - Variable Interest Entity			(826)				-
Borrowing on Loan Payable			470,044				-
Principal Payment on Loan Payable			(225,000)				-
Principal Payments On Notes Payable			(30,028)				(7,380)
Deferred Financing Costs			(1,905)				(480)
Security Deposits			311				341
Net Cash Flows Provided by Financing Activities			2,186				85,747
EFFECT OF FOREIGN CURRENCY TRANSLATION			(121)				32
Net (Decrease) Increase in Cash and Cash Equivalents			(19,494)				35,512
Cash and Cash Equivalents, Beginning of Period			107,355				238,277
Cash and Cash Equivalents, End of Period			$87,861				$273,789
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash Paid During the Period for Interest			20,342				21,046
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES
Distributions Declared and Payable			35,486				37,366
Proceeds from Dividend Reinvestment			33,579				31,513
Duke joint venture Contribution/Distribution - Amazon Expansion			19				874
Notes Payable Assumed on Acquisitions of Real Estate			216,011				-
Conversion of Duke Joint Venture Equity Investment to Controlling Interest			139,770				-
Share Awards Increase in APIC			4,556				-
Accrued Offering Costs			-				3
Accounts Payable and Accrued Expenses - CIP			1,526				3,691

 

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CHAMBERS STREET PROPERTIES

Reconciliation of Net (Loss) Income to FFO, Core FFO and AFFO

For the Three and Six Months Ended June 30, 2013 and 2012 (unaudited)

(In Thousands, Except Share Data)

 

		Three Months Ended June 30,								Six Months Ended June 30,
		2013				2012				2013				2012
Net (Loss) Income			$(3,640)				$(1,899)				$78,450				$(4,053)
Real Estate Depreciation and Amortization			26,770				17,985				48,774				35,961
Loss (Gain) on Conversion of Equity Interest to Controlling Interest			32				-				(77,202)				-
Loss on Write Down to Net Sales Value			-				415				-				415
Net Effect of FFO Adjustment from Unconsolidated Entities (1)			9,828				12,719				20,151				25,788
Funds from Operations			32,990				29,220				70,173				58,111
Acquisition Expenses			162				31				2,004				1,928
Gain on Interest Rate Swaps			(2,383)				(122)				(1,466)				(246)
Transition Costs			693				1,936				728				1,936
Listing Expense			10,506				-				10,506				-
Net Effect of Core FFO Adjustments from Unconsolidated Entities (2)			(1,032)				491				(3,566)				798
Core Funds from Operations			40,936				31,556				78,379				62,527
Amortization of Deferred Financing Costs			677				458				1,288				911
Amortization of Above and Below Market Leases			1,782				887				3,155				1,501
Amortization of Premium on Notes Payable			(1,113)				(338)				(1,655)				(651)
Amortization of Deferred Revenue Related to Tenant Improvements			(716)				-				(716)				-
Share Based Compensation			553				-				993				-
Straight-line Rent Adjustments, Net			(2,621)				(1,791)				(4,531)				(3,761)
Recurring Capital Expenditures			(1,615)				(620)				(2,238)				(1,334)
Net Effect of AFFO Adjustments from Unconsolidated Entities (3)			(3,293)				(2,511)				(4,598)				(4,018)
Adjusted Funds from Operations			$34,590				$27,641				$70,077				$55,175
Amounts per share (basic and diluted):
Net (Loss) Income			$(0.01)				$(0.01)				$0.32				$(0.02)
Funds from Operations			$0.13				$0.12				$0.28				$0.24
Core Funds from Operations			$0.16				$0.13				$0.32				$0.25
Adjusted Funds from Operations			$0.14				$0.11				$0.28				$0.22
Weighted Average Common Shares Outstanding - Basic & Diluted			248,224,851				249,117,722				248,350,481				246,983,416

 

(1)	Consists of amortization and depreciation and realized loss related to properties held in unconsolidated entities for all periods presented.

(2)	Consists of unrealized gain related to properties held in the unconsolidated entities for all periods presented.

(3)	Consists of straight-line rent adjustments, amortization of above and below market leases and recurring capital expenditures offset by deferred financing costs related to properties held in the unconsolidated entities, respectively for all periods presented.

 

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Joint Venture Balance Sheets (at 100%)

as of June 30, 2013 and December 31, 2012 (unaudited)

(In Thousands)

 

		Duke Joint Venture (1)								Afton Ridge (1)								UK JV								European JV
		June 30, 2013				December 31, 2012				June 30, 2013				December 31, 2012				June 30, 2013				December 31, 2012				June 30, 2013				December 31, 2012
Assets
Real Estate Net			$444,009				$780,130				$43,373				$44,058				$42,111				$45,871				$202,849				$208,786
Other Assets			64,403				146,572				2,743				2,704				2,546				2,807				16,404				23,036
Total Assets			$508,412				$926,702				$46,116				$46,762				$44,657				$48,678				$219,253				$231,822
Liabilities and Equity
Notes Payable			$254,365				$472,370				$25,500				$25,500				-				-				$81,804				$82,894
Other Liabilities			11,278				24,179				2,301				2,428				1,671				1,819				4,714				13,022
Total Liabilities			265,643				496,549				27,801				27,928				1,671				1,819				86,518				95,916
Company’s Equity			194,703				344,511				16,539				17,008				34,389				37,487				106,188				108,725
Other Investor’s Equity			48,066				85,642				1,776				1,826				8,597				9,372				26,547				27,181
Total Liabilities and Equity			$508,412				$926,702				$46,116				$46,762				$44,657				$48,678				$219,253				$231,822

 

(1)	Includes REIT Basis Adjustments.

 

11  |  Supplemental Information  |  Second Quarter 2013

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Joint Venture Statements of Operations (at 100%)

For the Three Months Ended June 30, 2013 and June 30, 2012 (unaudited)

(In Thousands)

 

		Duke Joint Venture  (1)								Afton Ridge (1)								UK JV								European JV
		Three Months Ended June 30,								Three Months Ended June 30,								Three Months Ended June 30,								Three Months Ended June 30,
		2013				2012				2013				2012				2013				2012				2013				2012
Total Revenues			$16,552				$30,887				$1,292				$1,306				$1,090				$1,135				$4,537				$2,904
Operating Expenses			(5,311)				(10,160)				(346)				(347)				(144)				(153)				(745)				(366)
Net Operating Income			11,241				20,727				946				959				946				982				3,792				2,538
Interest			(3,520)				(6,150)				(376)				(376)				-				-				(552)				-
Depreciation and Amortization			(7,721)				(14,874)				(425)				(458)				(483)				(501)				(1,814)				(1,360)
Net Income from Continuing Operations			-				(297)				145				125				463				481				1,426				1,178
Net Income from Discontinued Operations			(32)				-				-				-				-				-				-				-
Net Income (Loss)			(32)				(297)				145				125				463				481				1,426				1,178
Company’s Share in Net Income (Loss)			(26)				(237)				131				112				370				385				1,141				942
Adjustments for REIT Basis			(38)				(34)				(5)				(4)				-				-				-				-
Company’s Equity in Net Income (Loss)			($64)				($271)				$126				$108				$370				$385				$1,141				$942

 

(1)	Includes REIT Basis Adjustments.

For the Six Months Ended June 30, 2013 and June 30, 2012 (unaudited)

(In Thousands)

 

		Duke Joint Venture  (1)								Afton Ridge (1)								UK JV								European JV
		Six Months Ended June 30,								Six Months Ended June 30,								Six Months Ended June 30,								Six Months Ended June 30,
		2013				2012				2013				2012				2013				2012				2013				2012
Total Revenues			$33,171				$62,280				$2,600				$2,650				$2,214				$1,980				$9,627				$5,859
Operating Expenses			(10,776)				(20,613)				(660)				(704)				(290)				(904)				(1,912)				(772)
Net Operating Income			22,395				41,667				1,940				1,946				1,924				1,076				7,715				5,087
Interest			(7,036)				(12,304)				(752)				(752)				-				-				(1,108)				-
Depreciation and Amortization			(15,533)				(29,791)				(860)				(923)				(979)				(849)				(3,281)				(2,719)
Net Income from Continuing Operations			(174)				(428)				328				271				945				227				3,326				2,368
Net Income from Discontinued Operations			2,236				-				-				-				-				-				-				-
Net Income (Loss)			2,062				(428)				328				271				945				227				3,326				2,368
Company’s Share in Net Income (Loss)			1,650				(342)				295				244				756				182				2,661				1,894
Adjustments for REIT Basis			497				(68)				(9)				(9)				-				-				-				-
Company’s Equity in Net Income (Loss)			$2,147				($410)				$286				$235				$756				$182				$2,661				$1,894

 

(1)	Includes REIT Basis Adjustments.

 

Supplemental Information  |  Second Quarter 2013  |  12

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Consolidated & Pro Rata Share Balance Sheets

as of June 30, 2013 and December 31, 2012 (unaudited)

(In Thousands)

 

		June 30, 2013												December 31, 2012
		Consolidated				Pro Rata Share of Joint Ventures (1)				Total at Pro Rata Share				Consolidated				Pro Rata Share of Joint Ventures (1)				Total at Pro Rata Share
Assets
Real Estate Net			$2,078,960				$591,235				$2,670,195				$1,600,811				$868,321				$2,469,132
Other Assets			429,784				69,289				499,073				438,222				140,506				578,728
Investments in Unconsolidated Entities			361,004				(351,819)				9,185				515,829				(507,731)				8,098
Total Assets			$2,869,748				$308,705				$3,178,453				$2,554,862				$501,096				$3,055,958
Liabilities and Equity
Notes & Loans Payable			$1,208,593				$292,474				$1,501,067				$767,232				$467,666				$1,234,898
Other Liabilities			129,889				16,231				146,120				126,807				33,430				160,237
Total Liabilities			1,338,482				308,705				1,647,187				894,039				501,096				1,395,135
Non-Controlling Interests			2,664				-				2,664				3,490				-				3,490
Shareholders’ Equity			1,528,602				-				1,528,602				1,657,333				-				1,657,333
Total Liabilities and Equity			$2,869,748				$308,705				$3,178,453				$2,554,862				$501,096				$3,055,958

 

(1)	Includes Duke joint venture, Afton Ridge, UK JV and European JV.

 

13  |  Supplemental Information  |  Second Quarter 2013

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Consolidated & Pro Rata Share Statements of Operations

For the Three Months Ended June 30, 2013 and 2012 (unaudited)

(In Thousands)

 

		Three Months Ended June 30, 2013												Three Months Ended June 30, 2012
		Consolidated				Pro Rata Share of Joint Ventures (1)				Total at Pro Rata Share				Consolidated				Pro Rata Share of Joint Ventures (1)				Total at Pro Rata Share
Total Revenues			$67,110				$18,906				$86,016				$44,886				$29,116				$74,002
Operating Expenses (2)			(19,231)				(5,271)				(24,503)				(10,978)				(8,856)				(19,834)
Net Operating Income			47,879				13,635				61,514				33,908				20,261				54,169
General and Administrative (Corporate Level )			(7,235)				-				(7,235)				(1,924)				-				(1,924)
Investment Management Fee to Related Party			11				-				11				(6,150)				-				(6,150)
Interest Expense			(10,482)				(3,596)				(14,078)				(8,711)				(5,258)				(13,969)
Acquisition Expenses			(162)				-				(162)				(31)				-				(31)
Depreciation and Amortization			(26,770)				(8,397)				(35,167)				(17,985)				(13,800)				(31,785)
Transition Costs			(693)				-				(693)				(1,936)				-				(1,936)
Listing Expense			(10,506)				-				(10,506)				-				-				-
Interest & Other Income			280				-				280				485				-				485
Net Settlement Payments on Interest Rate Swaps			(704)				-				(704)				(164)				-				(164)
(Loss) Gain on Interest Rate Swaps			2,383				-				2,383				122				-				122
Loss on Note Payable at Fair Value			(32)				-				(32)				(25)				-				(25)
(Provision) Benefit for Income Taxes			(151)				-				(151)				(160)				-				(160)
Equity In Income of Unconsolidated Entities			2,575				(1,642)				933				1,087				(1,202)				(115)
Gain on Conversion of Equity Investment to Controlling Interest			(32)				-				(32)				-				-				-
Net Income (Loss)			($3,640)				$ -				($3,640)				($1,484)				$ -				($1,484)

 

(1)	Includes Duke joint venture, Afton Ridge, UK JV and European JV.

(2)	Includes Operating and Maintenance, Property Taxes, Property Management Fee to Related Party and property-level General and Administrative.

 

Supplemental Information  |  Second Quarter 2013  |  14

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Consolidated & Pro Rata Share Statements of Operations

For the Six Months Ended June 30, 2013 and 2012 (unaudited)

(In Thousands)

 

		Six Months Ended June 30, 2013												Six Months Ended June 30, 2012
		Consolidated				Pro Rata Share of Joint Ventures (1)				Total at Pro Rata Share				Consolidated				Pro Rata Share of Joint Ventures (1)				Total at Pro Rata Share
Total Revenues			$121,062				$38,349				$159,411				$88,285				$58,480				$146,765
Operating Expenses (2)			(32,906)				(10,976)				(43,882)				(22,121)				(18,465)				(40,586)
Net Operating Income			88,156				27,373				115,529				66,164				40,015				106,179
General and Administrative (Corporate Level )			(12,189)				-				(12,189)				(3,812)				-				(3,812)
Investment Management Fee to Related Party			(489)				-				(489)				(12,111)				-				(12,111)
Interest Expense			(19,786)				(7,192)				(26,978)				(17,467)				(10,520)				(27,987)
Acquisition Expenses			(2,004)				-				(2,004)				(1,409)				-				(1,409)
Depreciation and Amortization			(48,774)				(16,609)				(65,383)				(35,961)				(27,518)				(63,479)
Transition Costs			(728)				-				(728)				(1,936)				-				(1,936)
Listing Expense			(10,506)				-				(10,506)				-				-				-
Interest & Other Income			487				-				487				1,545				-				1,545
Net Settlement Payments on Interest Rate Swaps			(1,047)				-				(1,047)				(324)				-				(324)
(Loss) Gain on Interest Rate Swaps			1,466				-				1,466				246				-				246
Loss on Note Payable at Fair Value			(57)				-				(57)				(60)				-				(60)
(Provision) Benefit for Income Taxes			(220)				-				(220)				(142)				-				(142)
Equity In Income of Unconsolidated Entities			6,939				(3,572)				3,367				1,629				(1,977)				(348)
Gain on Conversion of Equity Investment to Controlling Interest			77,202				-				77,202				-				-				-
Net Income (Loss)			$78,450				$ -				$78,450				($3,638)				$ -				($3,638)

 

(1)	Includes Duke joint venture, Afton Ridge, UK JV and European JV.

(2)	Includes Operating and Maintenance, Property Taxes, Property Management Fee to Related Party and property-level General and Administrative.

 

15  |  Supplemental Information  |  Second Quarter 2013

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CHAMBERS STREET PROPERTIES

Our Properties

as of June 30, 2013

($ in thousands)

 

Property and Market		Date Acquired				Year Built				Property Type		Our Effective Ownership				Net Rentable Square Feet				Percentage Leased				Approximate Total Acquisition Cost (1)
Domestic Consolidated Properties:
REMEC Corporate Campus 1 (2)
San Diego, CA			9/15/2004				1983			Office			100.00%				34,000				100.00%				$6,833
REMEC Corporate Campus 2 (2)
San Diego, CA			9/15/2004				1983			Office			100.00%				30,477				100.00%				6,125
REMEC Corporate Campus 3 (2)
San Diego, CA			9/15/2004				1983			Office			100.00%				37,430				100.00%				7,523
REMEC Corporate Campus 4 (2)
San Diego, CA			9/15/2004				1983			Office			100.00%				30,778				100.00%				6,186
300 Constitution Drive (2)
Boston, MA			11/3/2004				1998			Warehouse/ Distribution			100.00%				330,000				0.00%				19,805
Deerfield Commons (2)
Atlanta, GA			6/21/2005				2000			Office			100.00%				121,969				100.00%				21,834
505 Century Parkway (2)
Dallas, TX			1/9/2006				1997			Warehouse/ Distribution			100.00%				100,000				66.86%				6,095
631 International Parkway (2)
Dallas, TX			1/9/2006				1998			Warehouse/ Distribution			100.00%				73,112				100.00%				5,407
660 North Dorothy (2)
Dallas, TX			1/9/2006				1997			Warehouse/ Distribution			100.00%				120,000				100.00%				6,836
Bolingbrook Point III
Chicago, IL			8/29/2007				2006			Warehouse/ Distribution			100.00%				185,045				100.00%				18,170
Community Cash Complex 1 (2)
Spartanburg, SC			8/30/2007				1960			Warehouse/ Distribution			100.00%				205,951				3.50%				2,690
Community Cash Complex 2 (2)																									2,225
Spartanburg, SC			8/30/2007				1978			Warehouse/ Distribution			100.00%				144,488				76.58%
Community Cash Complex 3 (2)																									1,701
Spartanburg, SC			8/30/2007				1981			Warehouse/ Distribution			100.00%				116,413				0.00%
Community Cash Complex 4 (2)																									547
Spartanburg, SC			8/30/2007				1984			Warehouse/ Distribution			100.00%				33,019				100.00%
Community Cash Complex 5 (2)																									824
Spartanburg, SC			8/30/2007				1984			Warehouse/ Distribution			100.00%				53,033				100.00%
Fairforest Building 1 (2)
Spartanburg, SC			8/30/2007				2000			Warehouse/ Distribution			100.00%				51,028				100.00%				2,974
Fairforest Building 2 (2)
Spartanburg, SC			8/30/2007				1999			Warehouse/ Distribution			100.00%				104,160				100.00%				5,379
Fairforest Building 3 (2)
Spartanburg, SC			8/30/2007				2000			Warehouse/ Distribution			100.00%				100,000				100.00%				5,760
Fairforest Building 4 (2)
Spartanburg, SC			8/30/2007				2001			Warehouse/ Distribution			100.00%				190,606				100.00%				5,640
Fairforest Building 5
Spartanburg, SC			8/30/2007				2006			Warehouse/ Distribution			100.00%				316,491				100.00%				16,968
Fairforest Building 6
Spartanburg, SC			8/30/2007				2005			Warehouse/ Distribution			100.00%				101,055				100.00%				7,469
Fairforest Building 7 (2)
Spartanburg, SC			8/30/2007				2006			Warehouse/ Distribution			100.00%				101,459				83.78%				5,626
Greenville/Spartanburg Industrial Park (2)
Spartanburg, SC			8/30/2007				1990			Warehouse/ Distribution			100.00%				67,375				100.00%				3,388
Highway 290 Commerce Park Building 1 (2)
Spartanburg, SC			8/30/2007				1995			Warehouse/ Distribution			100.00%				150,000				100.00%				5,388
Highway 290 Commerce Park Building 5 (2)
Spartanburg, SC			8/30/2007				1993			Warehouse/ Distribution			100.00%				30,000				100.00%				1,420
Highway 290 Commerce Park Building 7 (2)
Spartanburg, SC			8/30/2007				1994			Warehouse/ Distribution			100.00%				93,971				100.00%				4,889
HJ Park Building 1 (2)
Spartanburg, SC			8/30/2007				2003			Warehouse/ Distribution			100.00%				70,000				100.00%				4,216
Jedburg Commerce Park (2)
Charleston, SC			8/30/2007				2007			Warehouse/ Distribution			100.00%				512,686				100.00%				41,991
Kings Mountain I
Charlotte, NC			8/30/2007				1998			Warehouse/ Distribution			100.00%				100,000				100.00%				5,497
Kings Mountain II
Charlotte, NC			8/30/2007				2002			Warehouse/ Distribution			100.00%				301,400				100.00%				11,311
Mount Holly Building
Charleston, SC			8/30/2007				2003			Warehouse/ Distribution			100.00%				100,823				100.00%				6,208

 

Supplemental Information  |  Second Quarter 2013  |  16

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CHAMBERS STREET PROPERTIES

Our Properties (continued)

as of June 30, 2013

($ in thousands)

 

Property and Market		Date Acquired				Year Built				Property Type		Our Effective Ownership				Net Rentable Square Feet				Percentage Leased				Approximate Total Acquisition  Cost (1)
Domestic Consolidated Properties:
North Rhett I
Charleston, SC			8/30/2007				1973			Warehouse/ Distribution			100.00%				284,750				0.00%				10,302
North Rhett II
Charleston, SC			8/30/2007				2001			Warehouse/ Distribution			100.00%				101,705				100.00%				7,073
North Rhett III (2)
Charleston, SC			8/30/2007				2002			Warehouse/ Distribution			100.00%				79,972				100.00%				4,812
North Rhett IV
Charleston, SC			8/30/2007				2005			Warehouse/ Distribution			100.00%				316,040				100.00%				17,060
Orangeburg Park Building
Charleston, SC			8/30/2007				2003			Warehouse/ Distribution			100.00%				101,055				0.00%				5,474
Orchard Business Park 2 (2)
Spartanburg, SC			8/30/2007				1993			Warehouse/ Distribution			100.00%				17,500				100.00%				761
Union Cross Building I
Winston-Salem, NC			8/30/2007				2005			Warehouse/ Distribution			100.00%				100,853				100.00%				6,585
Union Cross Building II
Winston-Salem, NC			8/30/2007				2005			Warehouse/ Distribution			100.00%				316,130				100.00%				17,216
Highway 290 Commerce Park Building 2 (2)
Spartanburg, SC			9/24/2007				1995			Warehouse/ Distribution			100.00%				100,000				100.00%				4,626
Highway 290 Commerce Park Building 6 (2)
Spartanburg, SC			11/1/2007				1996			Warehouse/ Distribution			100.00%				105,000				100.00%				3,760
Lakeside Office Center
Dallas, TX			3/5/2008				2006			Office			100.00%				98,750				95.65%				17,994
Kings Mountain III (2)
Charlotte, NC			3/14/2008				2007			Warehouse/ Distribution			100.00%				541,910				100.00%				25,728
Enclave on the Lake (2)
Houston, TX			7/1/2008				1999			Office			100.00%				171,091				100.00%				37,827
Avion III
Washington, DC			11/18/2008				2002			Office			100.00%				71,507				100.00%				21,111
Avion IV
Washington, DC			11/18/2008				2002			Office			100.00%				71,504				100.00%				21,112
13201 Wilfred Lane (2)
Minneapolis, MN			6/29/2009				1999			Warehouse/ Distribution			100.00%				335,400				100.00%				15,340
3011, 3055 & 3077Comcast Place (2)
East Bay, CA			7/1/2009				1988			Office			100.00%				219,631				100.00%				49,000
140 Depot Street (2)
Boston, MA			7/31/2009				2009			Warehouse/ Distribution			100.00%				238,370				100.00%				18,950
12650 Ingenuity Drive
Orlando, FL			8/5/2009				1999			Office			100.00%				124,500				100.00%				25,350
Crest Ridge Corporate Center I (2)
Minneapolis, MN			8/17/2009				2009			Office			100.00%				116,338				100.00%				28,419
West Point Trade Center (2)
Jacksonville, FL			12/30/2009				2009			Warehouse/ Distribution			100.00%				601,500				100.00%				29,000
5160 Hacienda Dr (2)
East Bay, CA			4/8/2010				1988			Office			100.00%				201,620				100.00%				38,500
10450 Pacific Center Court (2)
San Diego, CA			5/7/2010				1985			Office			100.00%				134,000				100.00%				32,750
225 Summit Ave (2)
Northern NJ			6/21/2010				1966			Office			100.00%				142,500				100.00%				40,600
One Wayside Road
Boston, MA			6/24/2010				1998			Office			100.00%				200,605				100.00%				55,525
100 Tice Blvd
Northern NJ			9/28/2010				2007			Office			100.00%				208,911				100.00%				67,600
Ten Parkway North
Chicago, IL			10/12/2010				1999			Office			100.00%				99,566				100.00%				25,000
4701 Gold Spike Drive
Dallas, TX			10/27/2010				2002			Warehouse/ Distribution			100.00%				420,360				100.00%				20,300
1985 International Way
Hebron, KY			10/27/2010				1998			Warehouse/ Distribution			100.00%				189,400				100.00%				14,800
Summit Distribution Center
Salt Lake City, UT			10/27/2010				2001			Warehouse/ Distribution			100.00%				275,080				65.22%				13,400
3660 Deerpark Boulevard
Jacksonville, FL			10/27/2010				2002			Warehouse/ Distribution			100.00%				321,500				100.00%				15,300
Tolleson Commerce Park II
Phoenix, AZ			10/27/2010				1999			Warehouse/ Distribution			100.00%				217,422				100.00%				9,200

 

17  |  Supplemental Information  |  Second Quarter 2013

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CHAMBERS STREET PROPERTIES

Our Properties (continued)

as of June 30, 2013

($ in thousands)

 

Property and Market		Date Acquired				Year Built				Property Type		Our Effective Ownership				Net Rentable Square Feet				Percentage Leased				Approximate Total Acquisition  Cost (1)
Pacific Corporate Park (2)(3)
Washington, DC			11/15/2010				2002			Office			100.00	%			696,387				100.00	%			144,500
100 Kimball Drive (2)
Northern NJ			12/10/2010				2006			Office			100.00	%			175,000				100.00	%			60,250
70 Hudson Street
New York City Metro NJ			4/11/2011				2000			Office			100.00	%			409,272				100.00	%			155,000
90 Hudson Street
New York City Metro NJ			4/11/2011				1999			Office			100.00	%			419,868				64.86	%			155,000
Millers Ferry Road (2)
Dallas, TX			6/2/2011				2011			Warehouse/ Distribution			100.00	%			1,020,000				100.00	%			40,366
Sky Harbor Operations Center (2)
Phoenix, AZ			9/30/2011				2003			Office			100.00	%			396,179				100.00	%			53,500
1400 Atwater Drive (2)
Philadelphia, PA			10/27/2011				2013			Office			100.00	%			299,809				100.00	%			84,825
Aurora Commerce Center (2)
Denver, CO			11/30/2011				2007			Warehouse/ Distribution			100.00	%			406,959				100.00	%			24,500
Sabal Pavilion (2)
Tampa, FL			12/30/2011				1998			Office			100.00	%			120,500				100.00	%			21,368
2400 Dralle Road (2)(3)
Chicago, IL			3/20/2012				2011			Warehouse/ Distribution			100.00	%			1,350,000				100.00	%			64,250
Midwest Commerce Center I (2)
Kansas City, KS			8/16/2012				2009			Warehouse/ Distribution			100.00	%			1,107,000				100.00	%			62,950
20000 S Diamond Lake Rd. (2)
Minneapolis, MN			11/7/2012				2004			Warehouse/ Distribution			100.00	%			280,577				100.00	%			18,500
Gateway at Riverside (2)
Baltimore, MD			11/30/2012				1991			Warehouse/ Distribution			100.00	%			800,797				100.00	%			49,229
701 & 801 Charles Ewing Blvd. (2)
Central NJ			12/28/2012				2009			Office			100.00	%			110,765				100.00	%			28,310
Mid-Atlantic Distribution Center – Bldg. A (2)
Baltimore, MD			12/28/2012				2008			Warehouse/ Distribution			100.00	%			672,000				100.00	%			43,150
Celebration Office Center III (4)
Orlando, FL			3/1/2013				2009			Office			100.00	%			100,924				100.00	%			18,420
22535 Colonial Pkwy (4)
Houston, TX			3/1/2013				2009			Office			100.00	%			89,750				100.00	%			17,673
Northpoint III (4)
Orlando, FL			3/1/2013				2001			Office			100.00	%			108,499				100.00	%			22,394
Goodyear Crossing II (4)
Phoenix, AZ			3/1/2013				2009			Warehouse/ Distribution			100.00	%			820,384				100.00	%			64,883
3900 North Paramount Parkway (4)
Raleigh, NC			3/1/2013				1999			Office			100.00	%			100,987				100.00	%			18,523
3900 South Paramount Parkway (4)
Raleigh, NC			3/1/2013				1999			Office			100.00	%			119,170				100.00	%			20,859
1400 Perimeter Park Drive (4)
Raleigh, NC			3/1/2013				1991			Office			100.00	%			44,916				100.00	%			6,165
Miramar I (4)
Ft. Lauderdale, FL			3/1/2013				2001			Office			100.00	%			94,060				100.00	%			23,912
Miramar II (4)
Ft. Lauderdale, FL			3/1/2013				2001			Office			100.00	%			128,540				100.00	%			31,910
McAuley Place (4)
Cincinnati, OH			3/1/2013				2001			Office			100.00	%			190,096				100.00	%			32,309
Point West I (4)
Dallas, TX			3/1/2013				2008			Office			100.00	%			182,700				100.00	%			31,795
Easton III (4)
Columbus, OH			3/1/2013				1999			Office			100.00	%			135,485				100.00	%			20,194
Norman Pointe I (4)
Minneapolis, MN			3/1/2013				2000			Office			100.00	%			212,722				79.54	%			36,232
Norman Pointe II (4)
Minneapolis, MN			3/1/2013				2007			Office			100.00	%			324,296				100.00	%			46,113
The Landings I (4)
Cincinnati, OH			3/1/2013				2006			Office			100.00	%			175,695				100.00	%			30,249
The Landings II (4)
Cincinnati, OH			3/1/2013				2007			Office			100.00	%			175,076				94.34	%			23,977
Atrium I (4)
Columbus, OH			3/1/2013				1996			Office			100.00	%			315,102				100.00	%			45,071
Domestic Consolidated Properties (5)							2001										22,114,754				93.60	%			2,443,777

 

Supplemental Information  |  Second Quarter 2013  |  18

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CHAMBERS STREET PROPERTIES

Our Properties (continued)

as of June 30, 2013

($ in thousands)

 

Property and Market		Date Acquired				Year Built				Property Type		Our Effective Ownership				Net Rentable Square Feet				Percentage Leased				Approximate Total Acquisition Cost (1)
International Consolidated Properties:
602 Central Boulevard (2)
Coventry, UK			4/27/2007				2001			Office			100.00%				50,502				100.00%				23,847
Thames Valley Five (2)
Reading, UK			3/20/2008				1998			Office			100.00%				40,468				100.00%				29,572
Albion Mills Retail Park
Wakefield, UK			7/11/2008				2000			Retail			100.00%				55,294				100.00%				22,098
Maskew Retail Park
Peterborough, UK			10/23/2008				2007			Retail			100.00%				144,400				100.00%				53,740
International Consolidated Properties (5)							2003										290,664				100.00%				129,257
Consolidated Properties (5)							2002										22,405,418				93.68%				2,573,034
Domestic Unconsolidated Properties (6):
Buckeye Logistics Center (7)
Phoenix, AZ			6/12/2008				2008			Warehouse/ Distribution			80.00%				1,009,351				100.00%				52,797
Afton Ridge Shopping Center (8)
Charlotte, NC			9/18/2008				2007			Retail			90.00%				296,427				97.92%				44,530
Allpoints at Anson Bldg. 1 (7)
Indianapolis, IN			9/30/2008				2008			Warehouse/ Distribution			80.00%				1,036,573				100.00%				42,684
12200 President’s Court (7)
Jacksonville, FL			9/30/2008				2008			Warehouse/ Distribution			80.00%				772,210				100.00%				29,995
201 Sunridge Blvd. (7)
Dallas, TX			9/30/2008				2008			Warehouse/ Distribution			80.00%				822,550				100.00%				25,690
Aspen Corporate Center 500 (7)
Nashville, TN			9/30/2008				2008			Office			80.00%				180,147				100.00%				29,936
125 Enterprise Parkway (7)
Columbus, OH			12/10/2008				2008			Warehouse/ Distribution			80.00%				1,142,400				100.00%				38,088
Allpoints Midwest Bldg. 1 (7)
Indianapolis, IN			12/10/2008				2008			Warehouse/ Distribution			80.00%				1,200,420				100.00%				41,428
Fairfield Distribution Ctr. IX (7)
Tampa, FL			5/13/2009				2008			Warehouse/ Distribution			80.00%				136,212				100.00%				7,151
Sam Houston Crossing I (7)
Houston, TX			12/21/2010				2007			Office			80.00%				159,175				100.00%				20,400
Regency Creek I (7)
Raleigh, NC			12/21/2010				2008			Office			80.00%				122,087				100.00%				18,000
533 Maryville Centre (7)
St. Louis, MO			12/21/2010				2000			Office			80.00%				125,296				100.00%				19,102
555 Maryville Centre (7)
St. Louis, MO			12/21/2010				1999			Office			80.00%				127,082				93.18%				15,578
One Conway Park (2)(7)
Chicago, IL			3/24/2011				1989			Office			80.00%				105,000				71.80%				12,320
West Lake at Conway (7)
Chicago, IL			3/24/2011				2008			Office			80.00%				98,304				100.00%				14,060
One Easton Oval (2)(7)
Columbus, OH			3/24/2011				1997			Office			80.00%				125,031				76.47%				9,529
Two Easton Oval (2)(7)
Columbus, OH			3/24/2011				1995			Office			80.00%				128,674				72.11%				10,195
Weston Pointe I (7)
Ft. Lauderdale, FL			3/24/2011				1999			Office			80.00%				97,579				98.29%				15,507
Weston Pointe II (7)
Ft. Lauderdale, FL			3/24/2011				2000			Office			80.00%				97,180				100.00%				18,701
Weston Pointe III (7)
Ft. Lauderdale, FL			3/24/2011				2003			Office			80.00%				97,178				100.00%				18,867
Weston Pointe IV (7)
Ft. Lauderdale, FL			3/24/2011				2006			Office			80.00%				96,175				100.00%				22,605
Domestic Unconsolidated Properties (5)(6)							2006										7,975,051				98.60%				507,163

 

19  |  Supplemental Information  |  Second Quarter 2013

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CHAMBERS STREET PROPERTIES

Our Properties (continued)

as of June 30, 2013

($ in thousands)

 

Property and Market		Date Acquired				Year Built				Property Type		Our Effective Ownership				Net Rentable Square Feet				Percentage Leased				Approximate Total Acquisition Cost (1)
International Unconsolidated Properties (6):
Amber Park (2)(9)
Nottingham, UK			6/10/2010				1997			Warehouse/ Distribution			80.00%				208,423				100.00%				12,514
Brackmills (2)(9)
Northampton, UK			6/10/2010				1984			Warehouse/ Distribution			80.00%				186,618				100.00%				13,407
Duren (2)(10)
Rhine-Ruhr, Germany			6/10/2010				2008			Warehouse/ Distribution			80.00%				391,494				100.00%				13,148
Schonberg (2)(10)
Hamburg, Germany			6/10/2010				2009			Warehouse/ Distribution			80.00%				453,979				100.00%				13,819
Langenbach (2)(10)
Munich, Germany			10/28/2010				2010			Warehouse/ Distribution			80.00%				225,106				100.00%				18,573
Graben Distribution Center I (10)
Munich, Germany			12/20/2011				2011			Warehouse/ Distribution			80.00%				1,017,868				100.00%				54,962
Graben Distribution Center II (10)
Munich, Germany			12/20/2011				2011			Warehouse/ Distribution			80.00%				73,367				100.00%				6,868
Valley Park, Unit D (2)(9)
Rugby, UK			3/19/2012				2011			Warehouse/ Distribution			80.00%				146,491				100.00%				10,247
Koblenz Distribution Center (10)
Koblenz, Germany			12/12/2012				2012			Warehouse/ Distribution			80.00%				1,070,126				100.00%				63,021
International Unconsolidated Properties (5)(6)							2008										3,773,472				100.00%				206,559
Unconsolidated Properties (5)(6)							2006										11,748,523				99.05%				713,722
All Properties (5)(6)							2003										34,153,941				95.53%				$3,286,756

 

(1)	Approximate total acquisition cost represents the purchase price inclusive of customary closing costs and acquisition fee for properties acquired prior to January 1, 2009 and exclusive of customary costs and acquisition fees for properties acquired on a subsequent to January 1, 2009

(2)	This property is unencumbered.

(3)	Includes undeveloped land zoned for future office and warehouse/distribution/logistics use.

(4)	Properties acquired from the Duke joint venture on March 1, 2013.

(5)	Total or weighted average. Weighted average Year Built is weighted based upon approximate Total Acquisition Costs. Weighted average Percentage Leased is weighted based upon Net Rental Square feet.

(6)	Does not include CBRE Strategic Partners Asia properties.

(7)	This property is held through the Duke joint venture.

(8)	This property is held through the Afton Ridge joint venture.

(9)	This property is held through the UK JV.

(10)	This property is held through the European JV.

 

Supplemental Information  |  Second Quarter 2013  |  20

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CHAMBERS STREET PROPERTIES

Property Distribution and Types

as of June 30, 2013

($ in thousands)

Single- and Multi-Tenant Property Distribution

 

		Consolidated Properties												Unconsolidated Properties (1)												Consolidated & Unconsolidated Properties (1)
Property Type		Properties				Net Rentable Square Feet				Approximate Total Acquisition Cost				Properties				Net Rentable Square Feet				Approximate Total Acquisition Cost				Properties				Net Rentable Square Feet				Approximate Total Acquisition Cost
Triple Net Single-Tenant Properties			72				17,695,150				$1,860,147				18				10,170,513				$493,195				90				27,865,663				$2,353,342
Multi-Tenant Properties			19				3,589,698				518,679				10				1,356,539				178,820				29				4,946,237				697,499
Other Single-Tenant Properties			8				1,120,570				194,208				2				221,471				41,707				10				1,342,041				235,915
Total			99				22,405,418				$2,573,034				30				11,748,523				$713,722				129				34,153,941				$3,286,756

(1) Number of Properties and Net Rentable Square Feet for Unconsolidated Properties are at 100%. Approximate Total Acquisition Cost for Unconsolidated Properties is at our pro rata share of effective ownership. Does not include our investment in CBRE Strategic Partners Asia.

Property Types

 

		Consolidated Properties												Unconsolidated Properties (1)												Consolidated & Unconsolidated Properties (1)
Property Type		Properties				Net Rentable Square Feet				Approximate Total Acquisition Cost				Properties				Net Rentable Square Feet				Approximate Total Acquisition Cost				Properties				Net Rentable Square Feet				Approximate Total Acquisition Cost
Office			44				7,331,945				$1,691,257				13				1,558,908				$224,800				57				8,890,853				$1,916,057
Warehouse / Distribution			53				14,873,779				805,939				16				9,893,188				444,392				69				24,766,967				1,250,331
Retail			2				199,694				75,838				1				296,427				44,530				3				496,121				120,368
Total			99				22,405,418				$2,573,034				30				11,748,523				$713,722				129				34,153,941				$3,286,756

 

(1)	Number of Properties and Net Rentable Square Feet for Unconsolidated Properties are at 100%. Approximate Total Acquisition Cost for Unconsolidated Properties is at our pro rata share of effective ownership. Does not include our investment in CBRE Strategic Partners Asia.

 

21  |  Supplemental Information  |  Second Quarter 2013

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CHAMBERS STREET PROPERTIES

Geographic Distribution

as of June 30, 2013

($ In Thousands)

		Consolidated Properties												Unconsolidated Properties (1)												Consolidated & Unconsolidated Properties (1)
		Properties				Net Rentable Square Feet				Approximate Total Acquisition Costs				Properties				Net Rentable Square Feet				Approximate Total Acquisition Costs				Properties				Net Rentable Square Feet				Approximate Total Acquisition Costs
Domestic
New Jersey			6				1,466,316				$506,760				-				-				$             -				6				1,466,316				$506,760
Florida			8				1,600,023				187,654				6				1,296,534				112,826				14				2,896,557				300,480
Texas			9				2,275,763				184,293				2				981,725				46,090				11				3,257,488				230,383
Ohio			5				991,454				151,800				3				1,396,105				57,812				8				2,387,559				209,612
Virginia			3				839,398				186,723				-				-				-				3				839,398				186,723
Arizona			3				1,433,985				127,583				1				1,009,351				52,797				4				2,443,336				180,380
South Carolina			27				3,648,580				179,171				-				-				-				27				3,648,580				179,171
North Carolina			8				1,625,366				111,884				2				418,514				62,530				10				2,043,880				174,414
California			7				687,936				146,917				-				-				-				7				687,936				146,917
Minnesota			5				1,269,333				144,604				-				-				-				5				1,269,333				144,604
Illinois			3				1,634,611				107,420				2				203,304				26,380				5				1,837,915				133,800
Massachusetts			3				768,975				94,280				-				-				-				3				768,975				94,280
Maryland			2				1,472,797				92,379				-				-				-				2				1,472,797				92,379
Pennsylvania			1				299,809				84,825				-				-				-				1				299,809				84,825
Indiana			-				-				-				2				2,236,993				84,112				2				2,236,993				84,112
Kansas			1				1,107,000				62,950				-				-				-				1				1,107,000				62,950
Missouri			-				-				-				2				252,378				34,680				2				252,378				34,680
Tennessee			-				-				-				1				180,147				29,936				1				180,147				29,936
Colorado			1				406,959				24,500				-				-				-				1				406,959				24,500
Georgia			1				121,969				21,834				-				-				-				1				121,969				21,834
Kentucky			1				189,400				14,800				-				-				-				1				189,400				14,800
Utah			1				275,080				13,400				-				-				-				1				275,080				13,400
Total Domestic			95				22,114,754				2,443,777				21				7,975,051				507,163				116				30,089,805				2,950,940
International
Germany			-				-				-				6				3,231,940				170,391				6				3,231,940				170,391
United Kingdom			4				290,664				129,257				3				541,532				36,168				7				832,196				165,425
Total International			4				290,664				129,257				9				3,773,472				206,559				13				4,064,136				335,816
Total			99				22,405,418				$2,573,034				30				11,748,523				$713,722				129				34,153,941				$3,286,756

 

(1)	Number of Properties and Net Rentable Square Feet for Unconsolidated Properties are at 100%. Approximate Total Acquisition Cost for Unconsolidated Properties is at our pro rata share of effective ownership. Does not include our investment in CBRE Strategic Partners Asia.

 

Supplemental Information  |  Second Quarter 2013  |  22

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CHAMBERS STREET PROPERTIES

Significant Tenants

as of June 30, 2013 (unaudited)

($ in thousands)

 

						Consolidated Properties								Unconsolidated Properties (1)								Consolidated & Unconsolidated Properties (1)
		Major Tenants		Primary Industry		Net Rentable Square Feet				Annualized Base Rent				Net Rentable Square Feet				Annualized Base Rent				Net Rentable Square Feet				Annualized Base Rent
1		Amazon.com (2)		Internet Retail			820,384				$4,425				4,133,918				$15,659				4,954,302				$20,084
2		Barclay’s Capital		Financial Services			409,272				12,278				-				-				409,272				12,278
3		U.S. General Services Administration		Government			316,065				7,131				133,503				3,379				449,568				10,510
4		Raytheon Company		Defense and Aerospace			666,290				10,023				-				-				666,290				10,023
5		JP Morgan Chase		Financial Services			396,179				5,973				-				-				396,179				5,973
6		Lord Abbett & Co.		Financial Services			174,989				5,896				-				-				174,989				5,896
7		Nuance Communications		Software			200,605				5,753				-				-				200,605				5,753
8		Endo Health Solutions		Pharmaceutical and Health Care Related			299,809				5,591				-				-				299,809				5,591
9		Eisai		Pharmaceutical and Health Care Related			208,911				5,189				-				-				208,911				5,189
10		Comcast		Telecommunications			219,631				4,945				-				-				219,631				4,945
11		Pharmaceutical Product Development		Pharmaceutical and Health Care Related			251,475				4,797				-				-				251,475				4,797
12		The Coleman Company		Consumer Products			1,107,000				4,605				-				-				1,107,000				4,605
13		Deloitte		Professional Services			175,000				4,390				-				-				175,000				4,390
14		Clorox International		Consumer Products			1,350,000				4,310				-				-				1,350,000				4,310
15		Barr Laboratories		Pharmaceutical and Health Care Related			142,500				4,061				-				-				142,500				4,061
16		Conopco (3)		Consumer Products			-				-				1,594,760				3,864				1,594,760				3,864
17		Eveready Battery Company		Consumer Products			-				-				171,728				3,810				171,728				3,810
18		Nationwide Mutual Insurance		Insurance			315,102				3,733				-				-				315,102				3,733
19		ConAgra Foods		Food Service and Retail			741,860				3,422				-				-				741,860				3,422
20		NDB Capital Markets		Financial Services			97,138				3,400				-				-				97,138				3,400
21		Carl Zeiss		Pharmaceutical and Health Care Related			201,620				3,337				-				-				201,620				3,337
22		Whirlpool		Consumer Products			1,020,000				3,299				-				-				1,020,000				3,299
23		NCS Pearson		Education			167,218				3,191				-				-				167,218				3,191
24		American LaFrance		Vehicle Related Manufacturing			512,686				3,163				-				-				512,686				3,163
25		Bob’s Discount Furniture		Home Furnishings/Home Improvement			672,000				2,977				-				-				672,000				2,977
26		Prime Distribution Services		Logistics Distribution			-				-				1,200,420				2,958				1,200,420				2,958
27		Citicorp North America		Financial Services			194,064				2,855				-				-				194,064				2,855
28		Royal Caribbean Cruises		Travel/Leisure			128,540				2,837				-				-				128,540				2,837
29		Noxell Corporation		Consumer Products			800,797				2,836				-				-				800,797				2,836
30		Kellogg’s		Consumer Products			-				-				1,142,400				2,817				1,142,400				2,817
31		Time Warner		Telecommunications			134,000				2,814				-				-				134,000				2,814
32		REMEC		Defense and Aerospace			132,685				2,579				-				-				132,685				2,579
33		B & Q		Home Furnishings/Home Improvement			104,400				2,539				-				-				104,400				2,539
34		Dr Pepper		Food Service and Retail			601,500				2,532				-				-				601,500				2,532
35		American Home Mortgage		Financial Services			182,700				2,530				-				-				182,700				2,530
36		Syngenta Seeds Inc		Agriculture			116,338				2,473				-				-				116,338				2,473
37		Mercy Health Partners of SW Ohio		Pharmaceutical and Health Care Related			124,671				2,460				-				-				124,671				2,460
38		Disney Vacation Development		Travel/Leisure			100,924				2,460				-				-				100,924				2,460
39		Verizon Wireless (4)		Telecommunications			-				-				180,147				2,375				180,147				2,375
40		SBM Atlantia, Inc.		Petroleum and Mining			171,091				2,310				-				-				171,091				2,310
		Other (approx 234 tenants)					7,732,610				53,495				3,078,727				25,301				10,811,337				78,796
							20,990,054				$200,609				11,635,603				$60,163				32,625,657				$260,772

 

(1)	Net Rentable Square Feet for Unconsolidated Properties is at 100%. Annualized Base Rent for Unconsolidated Properties is at our pro rata share of effective ownership. Does not include our investment in CBRE Strategic Partners Asia.

(2)

Our tenants are Amazon.com.azdc, Inc., in the Buckeye Logistics Center and Goodyear Crossing Park II properties, Amazon.com.indc, LLC, in the AllPoints at Anson Bldg. 1 property, and Amazon Fulfillment GmbH, in the Graben Distribution Center I property, which are all wholly-owned subsidiaries of Amazon.com.

(3)	Our tenant is CONOPCO, Inc., a wholly-owned subsidiary of Unilever.

(4)	Verizon Wireless is the d/b/a for Cellco Partnership.

 

23  |  Supplemental Information  |  Second Quarter 2013

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CHAMBERS STREET PROPERTIES

Tenant Industries

as of Six Months Ended June 30, 2013

($ In Thousands)

 

		Consolidated Properties								Unconsolidated Properties  (1)								Consolidated & Unconsolidated Properties (1)
Primary Tenant Industry Category		Net Rentable Square Feet				Annualized Base Rent				Net Rentable Square Feet				Annualized Base Rent				Net Rentable Square Feet				Annualized Base Rent
Financial Services			1,648,406				$ 34,837				139,578				$ 1,683				1,787,984				$ 36,520
Consumer Products			4,618,067				16,596				3,513,556				13,391				8,131,623				29,987
Pharmaceutical and Health Care Related			1,614,073				27,274				315,729				2,625				1,929,802				29,899
Internet Retail			820,384				4,425				4,133,918				15,659				4,954,302				20,084
Defense and Aerospace			900,579				15,297				-				-				900,579				15,297
Logistics and Distribution			964,154				4,358				2,243,094				7,975				3,207,248				12,333
Telecommunications			737,129				9,675				194,155				2,540				931,284				12,215
Government			316,065				7,131				133,503				3,379				449,568				10,510
Business Services			1,227,778				7,808				110,833				1,500				1,338,611				9,308
Education			399,921				7,645				101,040				1,604				500,961				9,249
Food Service and Retail			2,031,703				8,428				38,076				475				2,069,779				8,903
Vehicle Related Manufacturing			1,422,799				8,140				-				-				1,422,799				8,140
Home Furnishings/Home Improvement			1,132,685				7,157				61,149				868				1,193,834				8,025
Insurance			497,889				6,834				42,529				538				540,418				7,372
Professional Services			308,654				5,985				89,602				1,297				398,256				7,282
Software			200,605				5,753				15,424				243				216,029				5,996
Travel and Leisure			229,464				5,296				10,974				192				240,438				5,488
Other Manufacturing			775,395				2,831				152,667				2,543				928,062				5,374
Agriculture			227,103				4,588				8,809				99				235,912				4,687
Specialty Retail			413,549				3,130				110,537				1,223				524,086				4,353
Petroleum and Mining			173,879				2,366				54,755				690				228,634				3,056
Apparel Retail			135,485				1,759				89,385				642				224,870				2,401
Utilities			108,499				1,627				18,428				236				126,927				1,863
Executive Office Suites			85,789				1,669				11,760				56				97,549				1,725
Other Retail			-				-				46,102				705				46,102				705
Totals			20,990,054				$200,609				11,635,603				$60,163				32,625,657				$260,772

 

(1)	Net Rentable Square Feet for Unconsolidated Properties is at our pro rata share of effective ownership. Does not include our investment in CBRE Strategic Partners Asia.

 

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CHAMBERS STREET PROPERTIES

Tenant Lease Expirations

as of June 30, 2013

($ In Thousands)

 

		Consolidated Properties								Unconsolidated Properties  (1)								Consolidated & Unconsolidated Properties (1)
		Expiring Net Rentable Square Feet				Expiring Base Rent				Expiring Net Rentable Square Feet				Expiring Base Rent				Number of Expiring Leases				Expiring Net Rentable Square Feet				Expiring Base Rent				Percentage of Expiring Base Rent
2013 (Six months ending December 31, 2013)			943,806				$5,273				34,324				$371				22				978,130				$5,644				1.98%
2014			1,166,020				7,601				501,589				2,849				43				1,667,609				10,450				3.67%
2015			675,949				6,461				380,693				3,894				36				1,056,642				10,355				3.64%
2016			1,827,458				31,110				235,090				1,902				35				2,062,548				33,012				11.60%
2017			622,077				10,237				1,148,554				8,135				35				1,770,631				18,372				6.46%
2018			1,215,212				13,724				2,117,387				12,285				38				3,332,598				26,009				9.14%
2019			3,574,757				26,566				2,529,664				10,460				24				6,104,421				37,026				13.01%
2020			2,026,527				19,340				30,133				457				14				2,056,660				19,797				6.96%
2021			4,328,641				37,848				2,339,154				13,252				17				6,667,795				51,100				17.96%
2022			711,195				8,968				1,040,021				4,692				7				1,751,216				13,660				4.80%
Thereafter			3,898,412				52,392				1,278,994				6,745				22				5,177,406				59,138				20.76%
Total			20,990,054				$219,520				11,635,603				$65,042				293				32,625,657				$284,562				100%
Weighted Average Remaining Term (years) (2)
Triple Net Single-Tenant Properties (3)							7.53								6.95												7.41
Multi-Tenant Properties							7.12								5.41												6.59
Other Single-Tenant Properties							5.71								7.62												6.17
Total Weighted Average Remaining Term							7.30								6.56												7.13

 

(1)	Expiring Net Rentable Square Feet for Unconsolidated Properties is at 100%. Expiring Base Rent for Unconsolidated Properties is at our pro rata share of effective ownership and does not include our investment in CBRE Strategic Partners Asia.

(2)	Weighted Average Remaining Term is the average remaining term weighted by Expiring Base Rent.

(3)	Triple Net Single-Tenant Properties include certain properties that have di minimis secondary tenant(s).

 

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CHAMBERS STREET PROPERTIES

Debt Maturities

as of June 30, 2013

(In Thousands)

 

		Consolidated Debt (1)												Unconsolidated Debt (2)												Consolidated & Unconsolidated Debt (1)(2)
		Scheduled Amortization				Term Maturities				Total				Scheduled Amortization				Term Maturities				Total				Scheduled Amortization				Term Maturities				Total
2013 (Six months ending December 31, 2013) (3)(4)		$	7,934			$	8,776			$	16,710			$	703			$	102,310			$	103,013			$	8,637			$	111,086			$	119,723
2014			16,292				52,564				68,856				1,460				40,640				42,100				17,752				93,204				110,956
2015			16,028				132,448				148,476				1,536				-				1,536				17,564				132,448				150,012
2016			12,838				381,385				394,223				1,617				-				1,617				14,455				381,385				395,840
2017			12,028				34,326				46,354				1,701				65,443				67,144				13,729				99,769				113,498
2018			10,127				261,942				272,069				1,790				-				1,790				11,917				261,942				273,859
2019			7,448				100,786				108,234				1,884				-				1,884				9,332				100,786				110,118
2020			5,962				50,000				55,962				1,982				-				1,982				7,944				50,000				57,944
2021			3,742				70,448				74,190				1,504				69,315				70,819				5,246				139,763				145,009
2022			1,870				-				1,870				-				-				-				1,870				-				1,870
2023			1,987				-				1,987				-				-				-				1,987				-				1,987
Thereafter			1,337				-				1,337				-				-				-				1,337				-				1,337
Total		$	97,593			$	1,092,675			$	1,190,268			$	14,177			$	277,708			$	291,885			$	111,770			$	1,370,383			$	1,482,153

 

(1)	Consolidated debt amount includes $260,044,000 outstanding balance on the Unsecured Credit Facility as of June 30, 2013. The Unsecured Credit Facility may be extended for an additional year from September 2016 to September 2017.

(2)	Unconsolidated Debt amounts are at our pro rata share of effective ownership.

(3)	The Afton Ridge loan was paid in full on July 3, 2013.

(4)	During the six months ended June 30, 2013, the unconsolidated joint venture entities paid total principal amortization of $856,000; the Company’s pro rata share of such principal amortization was $685,000.

 

Supplemental Information  |  Second Quarter 2013  |  26

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CHAMBERS STREET PROPERTIES

Fixed and Floating Interest Rate Debt

as of June 30, 2013

(In Thousands)

 

		Consolidated Debt (1)												Unconsolidated Debt (2)												Consolidated & Unconsolidated Debt (1)(2)
		Scheduled Amortization				Term Maturities				Total				Scheduled Amortization				Term Maturities				Total				Scheduled Amortization				Term Maturities				Total
Amount
Fixed Interest Rate Debt		$	97,593			$	832,631			$	930,224			$	14,177			$	277,708			$	291,885			$	111,770			$	1,110,339			$	1,222,109
Floating Interest Rate Debt			-				260,044				260,044				-				-				-				-				260,044				260,044
Total		$	97,593			$	1,092,675			$	1,190,268			$	14,177			$	277,708			$	291,885			$	111,770			$	1,370,383			$	1,482,153
Weighted Average Remaining Term (years)
Fixed Interest Rate Debt											4.80												3.65												4.53
Floating Interest Rate Debt											3.21												N/A												3.21
Total											4.52												3.65												4.35
Weighted Average Interest Rate
Fixed Interest Rate Debt											4.54%												4.73%												4.58%
Floating Interest Rate Debt											1.80%												N/A												1.80%
Total											3.94%												4.73%												4.10%

 

(1)	Consolidated debt amount includes $260,044,000 outstanding balance on the Unsecured Credit Facility as of June 30, 2013. The Unsecured Credit Facility may be extended for an additional year from September 2016 to September 2017.

(2)	Unconsolidated Debt amounts are at our pro rata share of effective ownership.

 

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Encumbered and Unencumbered Properties

as of June 30, 2013

($ In Thousands)

 

		Consolidated Properties												Unconsolidated Properties (1)												Consolidated & Unconsolidated Properties (1)
		Properties				Approximate Total Acquisition Cost				Debt Balance				Properties				Approximate Total Acquisition Cost				Debt Balance				Properties				Approximate Total Acquisition Cost				Debt Balance
Encumbered Properties			46				$1,372,203				$680,224				21				$599,970				$291,885				67				$1,972,173				$972,109
Unencumbered Properties			53				1,200,831				-				9				113,752				-				62				1,314,583				-
Unsecured Debt			-				-				510,044				-				-				-				-				-				510,044
Total			99				$2,573,034				$1,190,268				30				$713,722				$291,885				129				$3,286,756				$1,482,153

 

(1)	Number or Properties at 100%. Approximate Total Acquisition Cost and Debt Balance for Unconsolidated Properties is at our pro rata share of effective ownership. Does not include our investment in CBRE Strategic Partners Asia.

 

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Non-GAAP Supplemental Financial Measures:

Net Operating Income

Net operating income, or NOI, is designed to reflect the operating performance of our portfolio by excluding certain items that are not considered to be controllable in connection with the management of the property. NOI is a non-GAAP financial measure which calculates, on a consolidated basis, rental income and tenant reimbursements less property and related expenses (operating and maintenance, property management fees, property level general and administrative expenses and real estate taxes) and excludes other non-property income and expenses, interest expense, depreciation and amortization, and our general and administrative expenses. NOI presented by us may not be comparable to NOI reported by other REITs that may use different methodologies. NOI should not be considered an alternative to net income as an indication of our performance, or as an alternative to cash flow from operating activities as a measure of our liquidity or ability to make cash distributions to shareholders.

Funds From Operations

The National Association of Real Estate Investment Trusts, or NAREIT, created Funds from Operations, or FFO, as a non-GAAP supplemental measure of REIT operating performance, which reflects the impact on operations from trends in occupancy rates, rental rates and operating costs. The most directly comparable GAAP measure to FFO is net income. FFO is used commonly in the real estate industry because historical cost accounting for real estate assets in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry analysts and investors consider presentations of operating results for REITs that use historical cost accounting to be insufficient.

We compute FFO in accordance with standards established by NAREIT. The revised NAREIT White Paper on FFO defines FFO as net income or loss computed in accordance with GAAP, excluding extraordinary items, as defined by GAAP, impairment charges and gains and losses from sales of depreciable operating property, plus real estate related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets), and after adjustment for unconsolidated partnerships and joint ventures.

Core Funds From Operations

Changes in the accounting and reporting rules under GAAP (for acquisition fees and expenses from a capitalization/depreciation model to an expensed-as-incurred model) that have been put into effect since the establishment of NAREIT’s definition of FFO have prompted an increase in the non-cash and non-operating items included in FFO. We calculate Core Funds from Operations, or Core FFO, as FFO exclusive of the net effects of acquisition costs, interest rate swap gains/losses, transition and listing costs, and unrealized gain/loss in investments in unconsolidated entities.

We believe that Core FFO is a useful measure of management’s decision-making process and appropriately presents our results of operations on a comparative basis. The items that we exclude from net income are subject to significant fluctuations from period to period that cause both positive and negative effects on our results of operations, often in inconsistent and unpredictable directions. For example, our acquisition costs are primarily the result of the volume of our acquisitions completed during each period, and therefore we believe such acquisition costs are not reflective of our operating results during each period. Similarly, unrealized gains or losses that we have recognized during a given period are based primarily upon changes in the estimated fair market value of certain of our investments due to changes in market conditions and do not necessarily reflect the operating performance of these properties during the corresponding period. Further, costs associated with certain other non-reoccurring expenses, such as the process of transitioning from being an externally

 

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managed company to a self-managed company, our listing of our common shares on the New York Stock Exchange and our modified “Dutch Auction” tender offer are not reflective of our operating results during each period.

We believe that Core FFO is useful to investors as a supplemental measure of operating performance because adjusting FFO to exclude acquisition costs, unrealized gains and/or losses or other non-reoccurring expenses provides investors a view of the performance of our portfolio over time, including if we cease to acquire properties on a frequent and regular basis and allows for a comparison of the performance of our portfolio with other REITs that are not currently engaging in acquisitions. We also believe that Core FFO may provide investors with a useful indication of our future performance, and of the sustainability of our current distribution policy. However, because Core FFO excludes acquisition costs, unrealized gains or losses and/or other non-reoccurring expenses which are important components in an analysis of our historical performance, such supplemental measure should not be construed as a historical performance measure and may not be as useful a measure for estimating the value of our common shares.

We calculate Adjusted Funds From Operations, or AFFO, as Core FFO exclusive of the net effects of (i) amortization associated with deferred financings costs; (ii) amortization of above- and below-market lease intangibles; (iii) amortization of premium on notes payable; (iv) amortization of deferred revenue related to tenant improvements; (v) non-cash share-based compensation expense; (vi) straight-line rental revenue; and (vii) recurring capital expenditures.

Not all REITs calculate FFO, Core FFO or AFFO (or an equivalent measure), in the same manner and therefore comparisons with other REITs may not be meaningful. None of these measures present, nor do we intend for them to present, a complete picture of our financial condition and/or operating performance. We believe that net income, as computed under GAAP, appropriately remains the primary measure of our performance and that FFO, Core FFO and AFFO, when considered in conjunction with net income, improves the investing public’s understanding of the operating results of REITs and makes comparisons of REIT operating results more meaningful.

 

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		Chambers Street Properties 47 Hulfish Street, Suite 210 Princeton, NJ 08542-3706 www.ChambersStreet.com