Attached files
| file | filename |
|---|---|
| 8-K - 8-K - Physicians Realty Trust | a15-14099_18k.htm |
| EX-99.2 - EX-99.2 - Physicians Realty Trust | a15-14099_1ex99d2.htm |
| EX-99.6 - EX-99.6 - Physicians Realty Trust | a15-14099_1ex99d6.htm |
| EX-99.4 - EX-99.4 - Physicians Realty Trust | a15-14099_1ex99d4.htm |
| EX-99.1 - EX-99.1 - Physicians Realty Trust | a15-14099_1ex99d1.htm |
| EX-99.5 - EX-99.5 - Physicians Realty Trust | a15-14099_1ex99d5.htm |
| EX-99.3 - EX-99.3 - Physicians Realty Trust | a15-14099_1ex99d3.htm |
| EX-23.1 - EX-23.1 - Physicians Realty Trust | a15-14099_1ex23d1.htm |
Exhibit 99.7
Physicians Realty Trust
Unaudited Pro Forma Condensed Consolidated Balance Sheet
March 31, 2015
(In thousands)
|
|
|
Historical |
|
Recent |
|
Pro Forma |
| |||
|
ASSETS |
|
|
|
|
|
|
| |||
|
Investment Properties |
|
|
|
|
|
|
| |||
|
Land and improvements |
|
$ |
99,950 |
|
$ |
3,311 |
|
$ |
103,261 |
|
|
Building and improvements |
|
817,673 |
|
38,664 |
|
856,337 |
| |||
|
Tenant improvements |
|
6,417 |
|
— |
|
6,417 |
| |||
|
Acquired lease intangibles |
|
109,173 |
|
11,151 |
|
120,324 |
| |||
|
|
|
1,033,213 |
|
53,126 |
|
1,086,339 |
| |||
|
Accumulated Depreciation |
|
(53,451 |
) |
— |
|
(53,451 |
) | |||
|
Net real estate property |
|
979,762 |
|
53,126 |
|
1,032,888 |
| |||
|
Real estate loan receivable |
|
16,094 |
|
— |
|
16,094 |
| |||
|
Investment in unconsolidated entity |
|
1,324 |
|
— |
|
1,324 |
| |||
|
Net real estate investments |
|
997,180 |
|
53,126 |
|
1,050,306 |
| |||
|
Cash and cash equivalents |
|
35,774 |
|
— |
|
35,774 |
| |||
|
Tenant receivables, net |
|
2,127 |
|
— |
|
2,127 |
| |||
|
Deferred costs, net |
|
4,601 |
|
110 |
|
4,711 |
| |||
|
Other assets |
|
26,525 |
|
— |
|
26,525 |
| |||
|
Total assets |
|
$ |
1,066,207 |
|
$ |
53,236 |
|
$ |
1,119,443 |
|
|
|
|
|
|
|
|
|
| |||
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
| |||
|
Credit facility borrowing |
|
$ |
73,000 |
|
$ |
40,870 |
|
$ |
113,870 |
|
|
Mortgage debt |
|
83,952 |
|
12,366 |
|
96,318 |
| |||
|
Accounts payable |
|
448 |
|
— |
|
448 |
| |||
|
Dividends payable |
|
16,722 |
|
— |
|
16,722 |
| |||
|
Accrued expenses and other liabilities |
|
13,029 |
|
— |
|
13,029 |
| |||
|
Acquired lease intangibles, net |
|
3,056 |
|
— |
|
3,056 |
| |||
|
Total liabilities |
|
190,207 |
|
53,236 |
|
243,443 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Redeemable noncontrolling interest — Operating Partnership |
|
13,721 |
|
— |
|
13,721 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Shareholder’s equity |
|
818,634 |
|
— |
|
818,634 |
| |||
|
Noncontrolling interest |
|
43,645 |
|
— |
|
43,645 |
| |||
|
Total equity |
|
862,279 |
|
— |
|
862,279 |
| |||
|
Total liabilities and equity |
|
$ |
1,066,207 |
|
$ |
53,236 |
|
$ |
1,119,443 |
|
See Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet.
Physicians Realty Trust
Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet
Basis of Presentation
The unaudited Pro Forma Condensed Consolidated Balance Sheet of Physicians Realty Trust (the “Company”) as of March 31, 2015 reflects the Company’s first and second quarter 2015 acquisitions of six medical office facilities (collectively the “Recent Properties”):
|
Property (1) |
|
Location |
|
Acquisition Date |
|
Price |
| |
|
Bridgeport Medical Center |
|
Lakewood, WA |
|
February 27, 2015 |
|
$ |
13,750 |
|
|
Calkins Properties |
|
Rochester, NY |
|
March 31, 2015 |
|
41,000 |
| |
|
Sitex Medical Plaza |
|
Orlando, FL |
|
March 31, 2015 |
|
14,600 |
| |
|
Health Park Surgery Center |
|
Grand Blanc, MI |
|
April 30, 2015 |
|
18,913 |
| |
|
Plaza Surgery Center |
|
Jacksonville, FL |
|
April 30, 2015 |
|
19,000 |
| |
|
Livonia MOB |
|
Livonia, MI |
|
May 29, 2015 |
|
14,750 |
| |
|
|
|
|
|
|
|
$ |
122,013 |
|
(1) “MOB” means medical office building
The acquisition of the Recent Properties were accounted for as business combinations and recorded at fair value (which approximated the purchase price), exclusive of acquisition costs, which were expensed. Each property’s fair value was then allocated between land, building, acquired lease intangibles and assumed mortgage debt based upon their fair values at the date of acquisition in accordance with the Company’s accounting policies outlined in the Company Annual Report on Form 10-K. The Recent Properties’ purchase prices were funded with borrowings on the Company’s unsecured credit facility of $110.0 million and assumed mortgage debt with a fair value of $12.4 million (contractual value of $12.0 million). The Recent Properties acquired in the first quarter of 2015 (Bridgeport Medical Center, Calkins Properties and Sitex Medical Plaza) are reflected in the historical consolidated balance sheet.
Notes and Management Assumptions
The historical consolidated balance sheet has been derived from the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2015, filed with the Securities and Exchange Commission (“SEC”) on May 8, 2015.
The Recent Properties column on the Pro Forma Condensed Consolidated Balance Sheet reflect the properties acquired in the second quarter of 2015 (Health Park Surgery Center, Plaza Surgery Center and Livonia MOB), which were funded with $40.9 million from proceeds under the Company’s unsecured credit facility and the assumption $12.4 million of mortgage debt on the Plaza Surgery Center.
Physicians Realty Trust
Unaudited Pro Forma Condensed Consolidated Statement of Operation
For the Three Months Ended March 31, 2015
(In thousands, expect share and per share data)
|
|
|
Historical |
|
Minneapolis |
|
Recent |
|
Pro Forma |
| ||||
|
Revenues: |
|
|
|
|
|
|
|
|
| ||||
|
Rental revenues |
|
$ |
20,341 |
|
$ |
678 |
|
$ |
1,938 |
|
$ |
22,957 |
|
|
Expense recoveries |
|
3,536 |
|
256 |
|
629 |
|
4,421 |
| ||||
|
Interest income on real estate loans and other |
|
607 |
|
— |
|
157 |
|
764 |
| ||||
|
Total revenue |
|
24,484 |
|
934 |
|
2,724 |
|
28,142 |
| ||||
|
Expenses: |
|
|
|
|
|
|
|
|
| ||||
|
Interest expense |
|
1,710 |
|
97 |
|
818 |
|
2,624 |
| ||||
|
General and administrative |
|
3,352 |
|
— |
|
— |
|
3,352 |
| ||||
|
Operating expenses |
|
5,709 |
|
208 |
|
895 |
|
6,812 |
| ||||
|
Depreciation and amortization |
|
8,240 |
|
264 |
|
1,355 |
|
9,859 |
| ||||
|
Acquisition costs |
|
5,932 |
|
— |
|
649 |
|
6,581 |
| ||||
|
Total expenses |
|
24,943 |
|
569 |
|
3,717 |
|
29,228 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
(Loss) income before equity in income of unconsolidated entity and noncontrolling interests: |
|
(459 |
) |
365 |
|
(993 |
) |
(1,086 |
) | ||||
|
Equity in income of unconsolidated entity |
|
26 |
|
— |
|
— |
|
26 |
| ||||
|
Loss on sale of investment property |
|
(15 |
) |
— |
|
— |
|
(15 |
) | ||||
|
Net (loss)/income |
|
(448 |
) |
$ |
365 |
|
$ |
(993 |
) |
(1,075 |
) | ||
|
Less: Net (income) loss attributable to noncontrolling interests |
|
(8 |
) |
|
|
55 |
|
47 |
| ||||
|
Preferred distributions |
|
(66 |
) |
(56 |
) |
|
|
(122 |
) | ||||
|
Net loss attributable to common shareholders |
|
$ |
(522 |
) |
|
|
|
|
$ |
(1,150 |
) | ||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Net loss per share: |
|
|
|
|
|
|
|
|
| ||||
|
Basic and diluted |
|
$ |
(0.01 |
) |
|
|
|
|
$ |
(0.02 |
) | ||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Weighted average common shares: |
|
|
|
|
|
|
|
|
| ||||
|
Basic and diluted |
|
65,649,478 |
|
|
|
|
|
70,076,978 |
| ||||
See Notes to Unaudited Pro Forma Condensed Consolidated Statements of Operations.
Physicians Realty Trust
Unaudited Pro Forma Condensed Consolidated Statement of Operation
For the Year Ended December 31, 2014
(In thousands, expect share and per share data)
|
|
|
Historical |
|
January |
|
Minneapolis |
|
2014 |
|
Recent |
|
Pro Forma |
| ||||||
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Rental revenues |
|
$ |
46,397 |
|
$ |
— |
|
$ |
6,264 |
|
$ |
10,772 |
|
$ |
7,821 |
|
$ |
71,254 |
|
|
Expense recoveries |
|
5,871 |
|
— |
|
3,914 |
|
4,276 |
|
3,173 |
|
17,234 |
| ||||||
|
Interest income on real estate loans and other |
|
1,066 |
|
— |
|
— |
|
179 |
|
— |
|
1,245 |
| ||||||
|
Total revenue |
|
53,334 |
|
— |
|
10,178 |
|
15,227 |
|
10,994 |
|
89,733 |
| ||||||
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Interest expense |
|
6,907 |
|
— |
|
387 |
|
3,225 |
|
2,581 |
|
13,100 |
| ||||||
|
General and administrative |
|
11,440 |
|
— |
|
— |
|
— |
|
— |
|
11,440 |
| ||||||
|
Operating expenses |
|
10,154 |
|
— |
|
4,346 |
|
4,700 |
|
3,237 |
|
22,437 |
| ||||||
|
Depreciation and amortization |
|
16,731 |
|
— |
|
4,518 |
|
4,966 |
|
5,647 |
|
31,862 |
| ||||||
|
Acquisition costs |
|
10,897 |
|
— |
|
— |
|
— |
|
— |
|
10,897 |
| ||||||
|
Impairment loss |
|
1,750 |
|
— |
|
— |
|
— |
|
— |
|
1,750 |
| ||||||
|
Total expenses |
|
57,879 |
|
— |
|
9,251 |
|
12,891 |
|
11,465 |
|
91,486 |
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
(Loss) income before equity in income of unconsolidated entity and noncontrolling interests: |
|
(4,545 |
) |
— |
|
927 |
|
2,336 |
|
(471 |
) |
(1,753 |
) | ||||||
|
Equity in income of unconsolidated entity |
|
95 |
|
— |
|
— |
|
— |
|
— |
|
95 |
| ||||||
|
Gain on sale of investment property |
|
32 |
|
— |
|
— |
|
— |
|
— |
|
32 |
| ||||||
|
Net (loss)/income |
|
(4,418 |
) |
$ |
— |
|
$ |
927 |
|
$ |
2,336 |
|
$ |
(471 |
) |
(1,626 |
) | ||
|
Less: Net (income) loss attributable to noncontrolling interests |
|
381 |
|
|
|
|
|
(253 |
) |
(57 |
) |
71 |
| ||||||
|
Preferred distributions |
|
— |
|
|
|
(487 |
) |
|
|
|
|
(487 |
) | ||||||
|
Net loss attributable to common shareholders |
|
$ |
(4,037 |
) |
|
|
|
|
|
|
|
|
$ |
(2,042 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Net loss per share: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Basic and diluted |
|
$ |
(0.12 |
) |
|
|
|
|
|
|
|
|
$ |
(0.04 |
) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Weighted average common shares: |
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
Basic and diluted |
|
33,063,093 |
|
18,975,000 |
|
|
|
|
|
|
|
52,038,093 |
| ||||||
See Notes to Unaudited Pro Forma Condensed Consolidated Statements of Operations.
Physicians Realty Trust
Notes to Unaudited Pro Forma Condensed Consolidated Statements of Operations
Basis of Presentation
The unaudited Pro Forma Condensed Consolidated Statements of Operations of the Company for the three months ended March 31, 2015 and for the year ended December 31, 2014 included the historical operations of the Company and have been derived from the unaudited consolidated statement of operations included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2015, filed with the with SEC on May 8, 2015 and the audited consolidated and combined statement of operations included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014, filed with the SEC on March 12, 2015. The Company’s historical operations have been adjusted to take into consideration the following transactions as if they occurred on January 1, 2014.
On January 21, 2015, the Company completed a follow-on public offering of 18,975,000 common shares of beneficial interest, including 2,475,000 common shares issued upon exercise of the underwriters’ overallotment option, resulting in net proceeds of approximately $297.2 million (the “January 2015 Offering”). The January 2015 Offering has been included in the pro forma condensed consolidated statement of operations to reflect the common shares issued.
During the first quarter and second quarter of 2015, the Company acquired the Recent Properties. Historical financial results for the periods presented for the Recent Properties are included elsewhere in this Form 8-K. Financial results for the three months ended March 31, 2015 and for the year ended December 31, 2014 related to the Recent Properties prior to their acquisition represents the results of operations under the previous owners and are included in the column labeled Recent Properties and adjusted as noted under “Notes and Management Assumptions.” Operating results for the Recent Properties acquired in the first quarter of 2015 since their acquisition date are included in the Company’s historical results of operations, including acquisition costs associated with the properties acquired during the first quarter of 2015.
During the first quarter of 2015, the Company acquired the Minneapolis Properties. Historical financial results and other information related to the Minneapolis Properties was included in a previously filed Form 8-KA, filed on April 17, 2015. Financial results for the three months ended March 31, 2015 and for the year ended December 31, 2014 related to the Minneapolis Properties prior to their acquisition represents the results of operations under the previous owners and are included in the column labeled Minneapolis Properties and adjusted as noted under “Notes and Management Assumptions.” Operating results for the Minneapolis Properties acquired in the first quarter of 2015 since their acquisition date are included in the Company’s historical results of operations, including acquisition costs.
During 2014, the Company acquired the Columbus Properties, the El Paso Properties and the Harrisburg Properties (collectively the “Third Quarter Acquisitions”), the Pinnacle Properties and the Oshkosh Property (collectively the “Second Quarter Acquisitions”) and the Atlanta Property, the Sarasota Properties and the San Antonio Property (collectively the “First Quarter Acquisitions”) (collectively the “2014 Acquisitions). Financial results and other information related to the Third Quarter Acquisitions, Second Quarter Acquisitions and First Quarter Acquisitions was included in a previously filed Form 8-KA, filed on November 12, 2014, August 4, 2014 and May 6, 2014, respectively. Financial results for the 2014 Acquisitions prior to their acquisition represents the results of operations under the previous owners and are included in the column labeled 2014 Acquisition Properties and adjusted as noted under “Notes and Management Assumptions.” Financial results since their acquisition are included in the Company’s historical consolidated results of operations for the period.
Notes and Management Assumptions
Revenue and operating expenses for the Minneapolis Properties, 2014 Acquisitions and Recent Properties (prior to their acquisitions) are based upon the historical operations under the previous owners’ ownership. The Recent Properties were acquired with borrowings on the Company’s unsecured revolving credit facility. Interest expense is based on upon either borrowings under the Company’s unsecured revolving credit
facility, (average annual rate outstanding on the credit facility at the time of the borrowing was approximately 1.7%) or assumed mortgage debt with an annual fair value rate of 4.5% (contractual rate of 6.1%). Depreciation and amortization expense is based upon the Company’s ownership and utilizing its own depreciation and amortization policies outlined in the Company Annual Report on Form 10-K. Acquisition costs associated with the 2014 Acquisitions are included in the Company’s historical operations for the year ended December 31, 2014, acquisition costs associated with the Minneapolis Properties and the Recent Properties acquired in the first quarter of 2015 are included in the Company’s historical operations for the three months ended March 31, 2015 and acquisitions costs associated with the Recent Properties acquired in the second quarter of 2015 are assumed to be incurred after the three months ended March 31, 2015. The impact of the Series A preferred units has been reflected in the column labeled Minneapolis Properties as if they were outstanding for the whole year. Net pro forma operating results were adjusted for the net cumulative impact to reflect the noncontrolling interest holders’ share related to the operating partnership operations after the impact of all pro forma adjustments, (includes the impact of the operating partnership units issued in connection with the acquisition of the El Paso Properties as if they were in outstanding as of January 1, 2014; the adjustment is reflected in the 2014 Acquisition column). The pro forma weighted average common shares have been adjusted for the impact of the January 2015 Offering, assuming the shares were outstanding as of January 1, 2014.