UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Date of Report (Date of earliest event reported): September 26, 2013 (September 20, 2013)
Behringer Harvard Opportunity REIT II, Inc.
(Exact Name of Registrant as Specified in Its Charter)
|
Maryland |
|
000-53650 |
|
20-8198863 |
|
(State or other jurisdiction of incorporation |
|
(Commission File Number) |
|
(I.R.S. Employer |
|
or organization) |
|
|
|
Identification No.) |
15601 Dallas Parkway, Suite 600, Addison, Texas
75001
(Address of principal executive offices)
(Zip Code)
(866) 655-3600
(Registrant’s telephone number, including area code)
None
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.01 Completion of Acquisition or Disposition of Assets.
Behringer Harvard Opportunity REIT II, Inc. (which may be referred to as the “Registrant”, “we”, “our”, or “us”), owns a 90% interest in BH-AW Florida MOB Venture, LLC (the “Florida MOB Joint Venture”). The remaining 10% interest in the Florida MOB Joint Venture is owned by AW SFMOB Investor, LLC (“AW Investor”) and AW SFMOB Managing Member, LLC (“AW Managing Member” and collectively with AW Investor, “AW”). Florida MOB Joint Venture indirectly owned ground leasehold interests in a portfolio of eight medical office buildings located in South Florida and approximately 7.8 acres excess land related to the buildings (collectively, the “Original MOB Portfolio”).
On September 20, 2013, the special purpose entities that owned the Original MOB Portfolio properties sold the properties to entities affiliated with AW and Healthcare Trust of America, Inc. for an aggregate contract sales price of approximately $63 million, which was paid in cash and through the assumption of existing indebtedness of approximately $18 million secured by two of the properties.
We acquired the Original MOB Portfolio on October 8, 2010, for a contract purchase price of $47.1 million, excluding closing costs. Florida MOB Joint Venture continues to own an approximately 88.7% interest in Gardens Medical Pavilion, an approximately 75,000 rentable square feet medical office building located in Palm Beach Gardens, Florida, that it acquired on October 20, 2010.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
Behringer Harvard Opportunity REIT II, Inc.
Unaudited Pro Forma Consolidated Financial Information
On September 20, 2013, the special purpose entities that owned the Original MOB Portfolio properties sold the properties to entities affiliated with AW and Healthcare Trust of America, Inc. for an aggregate contract sales price of approximately $63 million, which was paid in cash and through the assumption of existing indebtedness of approximately $18 million secured by two of the properties.
The following unaudited pro forma consolidated financial information gives effect to the disposition of the Original MOB Portfolio. In addition, the pro forma consolidated statement of operations for the years ended December 31, 2012 and 2011 have been adjusted to include the disposition of the remaining three buildings at Interchange Business Center (sold on April 12, 2013) for which these annual financial statements had not been recast to reflect this disposition. In our opinion, all material adjustments necessary to reflect the effects of the above transaction have been made.
Behringer Harvard Opportunity REIT II, Inc.
Unaudited Pro Forma Consolidated Balance Sheet
As of June 30, 2013
(in thousands, except shares)
The following unaudited Pro Forma Consolidated Balance Sheet is presented as if we had disposed of the Original MOB Portfolio as of June 30, 2013. This Pro Forma Consolidated Balance Sheet should be read in conjunction with our Pro Forma Consolidated Statement of Operations and our historical financial statements and notes thereto as filed in our quarterly report on Form 10-Q for the six months ended June 30, 2013. The Pro Forma Consolidated Balance Sheet is unaudited and is not necessarily indicative of what the actual financial position would have been had we completed the above transaction on June 30, 2013, nor does it purport to represent our future financial position.
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June 30, 2013 |
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Pro Forma |
|
|
| |||
|
|
|
as Reported |
|
Adjustments |
|
Pro Forma |
| |||
|
|
|
(a) |
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(b) |
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June 30, 2013 |
| |||
|
|
|
|
|
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|
| |||
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Assets |
|
|
|
|
|
|
| |||
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Real Estate |
|
|
|
|
|
|
| |||
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Land and land improvements, net |
|
$ |
67,736 |
|
$ |
(5,643 |
) |
$ |
62,093 |
|
|
Buildings and building improvements, net |
|
240,220 |
|
(38,174 |
) |
202,046 |
| |||
|
Real estate under development |
|
254 |
|
— |
|
254 |
| |||
|
Total real estate |
|
308,210 |
|
(43,817 |
) |
264,393 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Cash and cash equivalents |
|
68,720 |
|
39,166 |
|
107,886 |
| |||
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Restricted cash |
|
6,986 |
|
(397 |
) |
6,589 |
| |||
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Accounts receivable, net |
|
2,718 |
|
(434 |
) |
2,284 |
| |||
|
Prepaid expenses and other assets |
|
1,249 |
|
— |
|
1,249 |
| |||
|
Investment in unconsolidated joint venture |
|
11,635 |
|
— |
|
11,635 |
| |||
|
Furniture, fixtures and equipment, net |
|
7,952 |
|
(47 |
) |
7,905 |
| |||
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Deferred financing fees, net |
|
3,540 |
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(251 |
) |
3,289 |
| |||
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Lease intangibles, net |
|
4,580 |
|
(2,435 |
) |
2,145 |
| |||
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Total assets |
|
$ |
415,590 |
|
$ |
(8,215 |
) |
$ |
407,375 |
|
|
|
|
|
|
|
|
|
| |||
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Liabilities and Equity |
|
|
|
|
|
|
| |||
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Notes payable |
|
$ |
218,505 |
|
$ |
(18,098 |
) |
$ |
200,407 |
|
|
Accounts payable |
|
1,166 |
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— |
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1,166 |
| |||
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Payables to related parties |
|
626 |
|
(46 |
) |
580 |
| |||
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Acquired below-market leases, net |
|
841 |
|
(481 |
) |
360 |
| |||
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Accrued and other liabilities |
|
8,357 |
|
(1,458 |
) |
6,899 |
| |||
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Total liabilities |
|
229,495 |
|
(20,083 |
) |
209,412 |
| |||
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|
|
|
|
|
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|
| |||
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Commitments and contingencies |
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| |||
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Equity |
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|
| |||
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Preferred stock, $.0001 par value per share; 50,000,000 shares authorized, none outstanding |
|
— |
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— |
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— |
| |||
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Convertible stock, $.0001 par value per share; 1,000 shares authorized, 1,000 outstanding |
|
— |
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— |
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— |
| |||
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Common stock, $.0001 par value per share; 350,000,000 shares authorized, 26,038,553 shares issued and outstanding |
|
3 |
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— |
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3 |
| |||
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Additional paid-in capital |
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233,095 |
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— |
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233,095 |
| |||
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Accumulated distributions and net loss |
|
(56,567 |
) |
14,483 |
|
(42,084 |
) | |||
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Accumulated other comprehensive income |
|
81 |
|
— |
|
81 |
| |||
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Total Behringer Harvard Opportunity REIT II, Inc. equity |
|
176,612 |
|
14,483 |
|
191,095 |
| |||
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Noncontrolling interest |
|
9,483 |
|
(2,615 |
) |
6,868 |
| |||
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Total equity |
|
186,095 |
|
11,868 |
|
197,963 |
| |||
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Total liabilities and equity |
|
$ |
415,590 |
|
$ |
(8,215 |
) |
$ |
407,375 |
|
See accompanying Notes to Unaudited Pro Forma Consolidated Financial Statements.
Behringer Harvard Opportunity REIT II, Inc.
Unaudited Pro Forma Consolidated Statement of Operations
For the Six Months Ended June 30, 2013
(in thousands, except per share amounts)
The following unaudited Pro Forma Consolidated Statement of Operations is presented as if we had disposed of the Original MOB Portfolio as of January 1, 2011. This Pro Forma Consolidated Statement of Operations should be read in conjunction with our historical financial statements and notes thereto as filed in our quarterly report on Form 10-Q for the six months ended June 30, 2013. The Pro Forma Consolidated Statement of Operations does not include nonrecurring items, is unaudited and is not necessarily indicative of what the actual results of operations would have been had we completed the above transaction on January 1, 2011 nor does it purport to represent our future operations.
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Six Months Ended |
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Pro Forma |
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Pro Forma Six Months |
| |||
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(a) |
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(b) |
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Ended June 30, 2013 |
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Revenues |
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|
| |||
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Rental revenue |
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$ |
18,596 |
|
$ |
(5,646 |
) |
$ |
12,950 |
|
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Hotel revenue |
|
7,012 |
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— |
|
7,012 |
| |||
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Total revenues |
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25,608 |
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(5,646 |
) |
19,962 |
| |||
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|
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|
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|
|
|
| |||
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Expenses |
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|
|
|
|
|
| |||
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Property operating expenses |
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6,615 |
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(2,499 |
) |
4,116 |
| |||
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Hotel operating expenses |
|
5,488 |
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— |
|
5,488 |
| |||
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Interest expense, net |
|
4,188 |
|
(464 |
) |
3,724 |
| |||
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Real estate taxes |
|
2,652 |
|
(512 |
) |
2,140 |
| |||
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Property management fees |
|
936 |
|
(245 |
) |
691 |
| |||
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Asset management fees |
|
1,545 |
|
— |
|
1,545 |
| |||
|
General and administrative |
|
1,633 |
|
— |
|
1,633 |
| |||
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Acquisition expense |
|
3,056 |
|
— |
|
3,056 |
| |||
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Depreciation and amortization |
|
8,373 |
|
(1,618 |
) |
6,755 |
| |||
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Total expenses |
|
34,486 |
|
(5,338 |
) |
29,148 |
| |||
|
|
|
|
|
|
|
|
| |||
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Interest income, net |
|
60 |
|
(3 |
) |
57 |
| |||
|
Other income |
|
10 |
|
— |
|
10 |
| |||
|
|
|
|
|
|
|
|
| |||
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Loss from continuing operations |
|
(8,808 |
) |
(311 |
) |
(9,119 |
) | |||
|
Noncontrolling interest in continuing operations |
|
347 |
|
31 |
|
378 |
| |||
|
Loss from continuing operations attributable to the Company |
|
$ |
(8,461 |
) |
$ |
(280 |
) |
$ |
(8,741 |
) |
|
|
|
|
|
|
|
|
| |||
|
Loss per share from continuing operations |
|
$ |
(0.32 |
) |
|
|
$ |
(0.34 |
) | |
|
Weighted average shares outstanding |
|
26,046 |
|
|
|
26,046 |
| |||
See accompanying Notes to Unaudited Pro Forma Consolidated Financial Statements.
Behringer Harvard Opportunity REIT II, Inc.
Unaudited Pro Forma Consolidated Statement of Operations
For the Year Ended December 31, 2012
(in thousands, except per share amounts)
The following unaudited Pro Forma Consolidated Statement of Operations is presented as if we had disposed of the Original MOB Portfolio and the remaining three buildings at Interchange Business Center as of January 1, 2011. This Pro Forma Consolidated Statement of Operations should be read in conjunction with our historical financial statements and notes thereto as filed in our annual report on Form 10-K for the year ended December 31, 2012. The Pro Forma Consolidated Statement of Operations does not include nonrecurring items, is unaudited and is not necessarily indicative of what the actual results of operations would have been had we completed the above transaction on January 1, 2011 nor does it purport to represent our future operations.
|
|
|
Year Ended |
|
Prior |
|
Pro Forma |
|
Pro Forma Year Ended |
| ||||
|
|
|
(a) |
|
(b) |
|
(c) |
|
December 31, 2012 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Revenues |
|
|
|
|
|
|
|
|
| ||||
|
Rental revenue |
|
$ |
33,638 |
|
$ |
(993 |
) |
$ |
(10,878 |
) |
$ |
21,767 |
|
|
Hotel revenue |
|
10,952 |
|
— |
|
— |
|
10,952 |
| ||||
|
Total revenues |
|
44,590 |
|
(993 |
) |
(10,878 |
) |
32,719 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Expenses |
|
|
|
|
|
|
|
|
| ||||
|
Property operating expenses |
|
22,385 |
|
(279 |
) |
(5,324 |
) |
16,782 |
| ||||
|
Interest expense |
|
9,111 |
|
(1,309 |
) |
(944 |
) |
6,858 |
| ||||
|
Real estate taxes |
|
4,507 |
|
(411 |
) |
(872 |
) |
3,224 |
| ||||
|
Property management fees |
|
1,678 |
|
(30 |
) |
(477 |
) |
1,171 |
| ||||
|
Asset management fees |
|
3,229 |
|
(131 |
) |
— |
|
3,098 |
| ||||
|
General and administrative |
|
3,205 |
|
— |
|
— |
|
3,205 |
| ||||
|
Acquisition expense |
|
750 |
|
— |
|
— |
|
750 |
| ||||
|
Depreciation and amortization |
|
14,809 |
|
(955 |
) |
(3,227 |
) |
10,627 |
| ||||
|
Total expenses |
|
59,674 |
|
(3,115 |
) |
(10,844 |
) |
45,715 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Interest income, net |
|
142 |
|
— |
|
(14 |
) |
128 |
| ||||
|
Other income |
|
88 |
|
— |
|
— |
|
88 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Income (loss) from continuing operations |
|
(14,854 |
) |
2,122 |
|
(48 |
) |
(12,780 |
) | ||||
|
Noncontrolling interest in continuing operations |
|
1,258 |
|
(424 |
) |
5 |
|
839 |
| ||||
|
Net income (loss) from continuing operations attributable to the Company |
|
$ |
(13,596 |
) |
$ |
1,698 |
|
$ |
(43 |
) |
$ |
(11,941 |
) |
|
|
|
|
|
|
|
|
|
|
| ||||
|
Loss per share from continuing operations |
|
$ |
(0.52 |
) |
|
|
|
|
$ |
(0.46 |
) | ||
|
Weighted average shares outstanding |
|
25,987 |
|
|
|
|
|
25,987 |
| ||||
See accompanying Notes to Unaudited Pro Forma Consolidated Financial Statements.
Behringer Harvard Opportunity REIT II, Inc.
Unaudited Pro Forma Consolidated Statement of Operations
For the Year Ended December 31, 2011
(in thousands, except per share amounts)
The following unaudited Pro Forma Consolidated Statement of Operations is presented as if we had disposed of the Original MOB Portfolio and the remaining three buildings at Interchange Business Center as of January 1, 2011. This Pro Forma Consolidated Statement of Operations should be read in conjunction with our historical financial statements and notes thereto as filed in our annual report on Form 10-K for the year ended December 31, 2012. The Pro Forma Consolidated Statement of Operations does not include nonrecurring items, is unaudited and is not necessarily indicative of what the actual results of operations would have been had we completed the above transaction on January 1, 2011 nor does it purport to represent our future operations.
|
|
|
Year Ended |
|
Prior |
|
Pro Forma |
|
Pro Forma Year Ended |
| ||||
|
|
|
(a) |
|
(b) |
|
(c) |
|
December 31, 2011 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Revenues |
|
|
|
|
|
|
|
|
| ||||
|
Rental revenue |
|
$ |
24,010 |
|
$ |
(1,197 |
) |
$ |
(10,486 |
) |
$ |
12,327 |
|
|
Hotel revenue |
|
6,564 |
|
— |
|
— |
|
6,564 |
| ||||
|
Interest income from real estate loan receivable |
|
2,931 |
|
— |
|
— |
|
2,931 |
| ||||
|
Total revenues |
|
33,505 |
|
(1,197 |
) |
(10,486 |
) |
21,822 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Expenses |
|
|
|
|
|
|
|
|
| ||||
|
Property operating expenses |
|
16,852 |
|
(320 |
) |
(4,894 |
) |
11,638 |
| ||||
|
Interest expense |
|
6,740 |
|
(1,345 |
) |
(958 |
) |
4,437 |
| ||||
|
Real estate taxes |
|
3,285 |
|
(396 |
) |
(1,178 |
) |
1,711 |
| ||||
|
Property management fees |
|
1,087 |
|
(30 |
) |
(448 |
) |
609 |
| ||||
|
Asset management fees |
|
2,913 |
|
(125 |
) |
— |
|
2,788 |
| ||||
|
General and administrative |
|
2,323 |
|
— |
|
— |
|
2,323 |
| ||||
|
Acquisition expense |
|
4,110 |
|
— |
|
— |
|
4,110 |
| ||||
|
Depreciation and amortization |
|
11,646 |
|
(916 |
) |
(3,805 |
) |
6,925 |
| ||||
|
Total expenses |
|
48,956 |
|
(3,132 |
) |
(11,283 |
) |
34,541 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Interest income, net |
|
136 |
|
— |
|
(9 |
) |
127 |
| ||||
|
Other income |
|
504 |
|
— |
|
— |
|
504 |
| ||||
|
Loss from continuing operations before equity in earnings (losses) of unconsolidated joint ventures |
|
(14,811 |
) |
1,935 |
|
788 |
|
(12,088 |
) | ||||
|
Equity in earnings of unconsolidated joint ventures |
|
2,681 |
|
— |
|
— |
|
2,681 |
| ||||
|
Income (loss) from continuing operations |
|
(12,130 |
) |
1,935 |
|
788 |
|
(9,407 |
) | ||||
|
Noncontrolling interest in continuing operations |
|
1,562 |
|
(387 |
) |
(79 |
) |
1,096 |
| ||||
|
Net income (loss) from continuing operations attributable to the Company |
|
$ |
(10,568 |
) |
$ |
1,548 |
|
$ |
709 |
|
$ |
(8,311 |
) |
|
|
|
|
|
|
|
|
|
|
| ||||
|
Loss per share from continuing operations |
|
$ |
(0.44 |
) |
|
|
|
|
$ |
(0.35 |
) | ||
|
Weighted average shares outstanding |
|
24,039 |
|
|
|
|
|
24,039 |
| ||||
See accompanying Notes to Unaudited Pro Forma Consolidated Financial Statements.
Behringer Harvard Opportunity REIT II, Inc.
Unaudited Notes to Pro Forma Consolidated Financial Statements
Unaudited Pro Forma Consolidated Balance Sheet
a. Reflects our historical balance sheet as of June 30, 2013.
b. Reflects our disposition of the Original MOB Portfolio which occurred on September 20, 2013. Amounts represent the necessary adjustments to remove the assets and liabilities sold to the buyer as a result of the disposition.
Unaudited Pro Forma Consolidated Statement of Operations for Six Months Ended June 30, 2013
a. Reflects our historical operations for the six months ended June 30, 2013.
b. Reflects the historical revenues and expenses of the Original MOB Portfolio, including property management fees, depreciation and amortization associated with the property.
Unaudited Pro Forma Consolidated Statement of Operations for Year Ended December 31, 2012
a. Reflects our historical operations for the year ended December 31, 2012.
b. Reflects the historical revenues and expenses of the remaining three buildings at Interchange Business Center (sold on April 12, 2013), including property management fees, asset management fees, depreciation and amortization associated with the property.
c. Reflects the historical revenues and expenses of the Original MOB Portfolio, including property management fees, depreciation and amortization associated with the property.
Unaudited Pro Forma Consolidated Statement of Operations for Year Ended December 31, 2011
a. Reflects our historical operations for the year ended December 31, 2011.
b. Reflects the historical revenues and expenses of the remaining three buildings at Interchange Business Center (sold on April 12, 2013), including property management fees, asset management fees, depreciation and amortization associated with the property.
c. Reflects the historical revenues and expenses of the Original MOB Portfolio, including property management fees, depreciation and amortization associated with the property.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
|
BEHRINGER HARVARD OPPORTUNITY REIT II, INC. | |
|
|
| |
|
|
| |
|
Dated: September 26, 2013 |
By: |
/s/ Andrew J. Bruce |
|
|
|
Andrew J. Bruce |
|
|
|
Chief Financial Officer |