Black Creek Diversified Property Fund Inc. - FORM 8-K - EX-99.1 - EXHIBIT 99.1 PRESS RELEASE - August 12, 2016

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EX-99.2 - EXHIBIT 99.2 PORTFOLIO PERFORMANCE AND OPERATIONAL REVIEW - Black Creek Diversified Property Fund Inc.q2earningssupplement.htm
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Exhibit 99.1
DIVIDEND CAPITAL DIVERSIFIED PROPERTY FUND
PROVIDES SECOND QUARTER 2016 PORTFOLIO UPDATE
1.44% total shareholder return for the quarter; 4.9% total shareholder return for the last twelve months 1
Acquired Suniland Shopping Center, a retail center in South Florida comprising approximately 82,000 square feet, for $67 million
Repaid approximately $79 million of secured borrowings with a weighted average interest rate of approximately 6.0%; subsequent to quarter end repaid an additional $24 million mortgage loan with an interest rate of approximately 5.9%
DENVER - August 12, 2016 - Dividend Capital Diversified Property Fund Inc. (“DPF”), a public reporting, daily NAV REIT (NASDAQ: ZDPFAX; ZDPFEX; ZDPFIX; ZDPFWX) reported results today for the second quarter ended June 30, 2016.
Total Shareholder Return
Total shareholder return, which represents the compound annual rate of return assuming reinvestment of all dividend distributions before the impact of up-front sales commissions and class-specific expenses as of June 30, 2016, was as follows for the indicated timeframe:
•
Quarter ended June 30, 2016:            1.44%
•
Year-to-date ended June 30, 2016:             1.18%
•
Twelve months ended June 30, 2016:        4.93%
•
Three years ended June 30, 2016 (annualized):    7.71% (24.99% cumulative)
•
Since NAV share class inception2 (annualized):     8.05% (33.70% cumulative)
Class A, Class W, and Class I shareholders had lower total returns than those set forth above due to up-front sales commissions and/or class-specific expenses.
Portfolio Overview
As of June 30, 2016, DPF’s portfolio consisted of 58 operating properties located in 20 geographic markets in the United States, aggregating approximately 9.3 million square feet. As of June 30, 2016, DPF’s real property portfolio was approximately 90.2% leased to approximately 550 tenants. These properties had an estimated fair value of approximately $2.3 billion (calculated in accordance with DPF’s valuation procedures), including:
•
17 office properties located in 13 geographic markets, aggregating approximately 3.6 million net rentable square feet, with an aggregate fair value amount of approximately $1.2 billion;
•
35 retail properties located in nine geographic markets, aggregating approximately 3.8 million net rentable square feet, with an aggregate fair value amount of approximately $1.0 billion; and
•
Six industrial properties located in three geographic markets, aggregating approximately 1.9 million net rentable square feet, with an aggregate fair value amount of approximately $85.6 million.
DPF’s leverage ratio, based on the fair value of its investments, was 44% as of June 30, 2016. The weighted average stated interest rate of DPF’s borrowings was 3.6% as of June 30, 2016.
 
1 All returns figures exclude up-front sales commissions and class-specific expenses
2 Measured from September 30, 2012





Acquisition Activity
During the quarter ended June 30, 2016, DPF acquired Suniland Shopping Center (“Suniland”), a retail center in Pinecrest, FL for $66.5 million. Suniland comprises approximately 82,000 square feet. At the time of acquisition, the center was approximately 94% leased to 27 tenants including CVS and Citibank. DPF funded the acquisition through cash on hand and availability under its revolving credit facility.
Financial Results for the quarter ended June 30, 2016
Net income according to generally accepted accounting principles (“GAAP”) for the quarter ended June 30, 2016 was $0.1 million, or $0.00 per basic and diluted share. This compares to a GAAP net income for the quarter ended June 30, 2015 of $0.1 million, or $0.00 per basic and diluted share.
GAAP net income for the six months ended June 30, 2016 was $48.4 million, or $0.27 per basic and diluted share. This compares to a GAAP net income for the six months ended June 30, 2015 of $132.3 million, or $0.68 per basic and diluted share.
Company-Defined Funds from Operations (“FFO”) for the quarter ended June 30, 2016 were $20.8 million, or $0.12 per basic and diluted share. This compares to FFO for the quarter ended June 30, 2015 of $20.4 million, or $0.10 per basic and diluted share.
FFO for the six months ended June 30, 2016 were $42.8 million, or $0.24 per basic and diluted share. This compares to FFO for the six months ended June 30, 2015 of $47.4 million, or $0.24 per basic and diluted share.
Portfolio and Leasing Summary
During the second quarter, same-store net operating income increased 0.3% compared to the quarter ended March 31, 2016, and decreased 1.2% when compared to the same quarter in 2015. When GAAP adjustments are excluded, same-store net operating income increased 0.6% compared to the quarter ended March 31, 2016, and increased 0.4% when compared to the same quarter in 2015.
During the second quarter, DPF signed 25 leases for approximately 298,000 square feet. On a comparable space basis, DPF signed 14 leases for approximately 143,000 square feet. The average growth in rents, on a GAAP basis, for the comparable leases signed in the second quarter was 15.4%. For the twelve months ended June 30, 2016, DPF signed 142 leases for approximately 886,000 square feet. On a comparable basis, DPF signed 96 leases for approximately 588,000 square feet. The average growth in rents, on a GAAP basis, for the comparable leases signed in the last twelve months was 25.7%.
The overall portfolio percentage leased was 90.2% as of June 30, 2016, compared to 90.2% on March 31, 2016 and 87.5% on June 30, 2015. Same-store percentage leased was 89.6% at June 30, 2016, compared to 89.3% at March 31, 2016 and 87.5% at June 30, 2015.
Non-GAAP Supplemental Financial Measure
DPF computes its financial results in accordance with GAAP. Below, DPF has provided reconciliations of both Company-Defined FFO and net operating income, which are both non-GAAP supplemental financial measures, to the most directly comparable GAAP measures (amounts in thousands, except per share information). For more information about Company-Defined FFO and net operating income, including why management believes both measures provide useful information, please see the Portfolio Performance and Operational Review furnished with this press release on Form 8-K filed with the SEC on August 12, 2016, available on DPF’s website, www.dividendcapitaldiversified.com, and the SEC’s website, www.sec.gov.





 
For the Three Months Ended June 30,
 
For the Six Months Ended June 30,
 
2016
 
2015
 
2016
 
2015
Reconciliation of net earnings to FFO:
 
 
 
 
 
 
 
Net income attributable to common stockholders
$
117

 
$
70

 
$
43,899

 
$
123,653

Add (deduct) NAREIT-defined adjustments:
 
 
 
 
 
 
 
Depreciation and amortization expense
20,198

 
19,738

 
40,034

 
40,554

Gain on disposition of real property
—

 
—

 
(41,400
)
 
(128,667
)
Impairment of real estate property
—

 
224

 
587

 
1,624

Noncontrolling interests’ share of net income
18

 
37

 
4,474

 
8,655

Noncontrolling interests’ share of FFO
(1,499
)
 
(1,472
)
 
(4,578
)
 
(3,280
)
FFO attributable to common shares-basic
18,834

 
18,597

 
43,016

 
42,539

FFO attributable to dilutive OP Units
1,456

 
1,331

 
3,334

 
2,993

FFO attributable to common shares-diluted
$
20,290

 
$
19,928

 
$
46,350

 
$
45,532

FFO per share-basic and diluted
$
0.12

 
$
0.10

 
$
0.26

 
$
0.23

Weighted average number of shares outstanding
 
 
 
 
 
 
 
Basic
161,209

 
183,157

 
162,581

 
181,247

Diluted
173,669

 
196,267

 
175,179

 
194,029

 
For the Three Months Ended June 30,
 
For the Six Months Ended June 30,
 
2016
 
2015
 
2016
 
2015
Reconciliation of FFO to Company-Defined FFO:
 
 
 
 
 
 
 
FFO attributable to common shares-basic
$
18,834

 
$
18,597

 
$
43,016

 
$
42,539

Add (deduct) our adjustments:
 
 
 
 
 
 
 
Acquisition-related expenses
474

 
358

 
525

 
783

Loss (Gain) on extinguishment of debt and financing commitments
—

 
272

 
(5,136
)
 
1,168

Gain on derivatives
—

 
(128
)
 
—

 
(117
)
Noncontrolling interests’ share of NAREIT-defined FFO
1,499

 
1,472

 
4,578

 
3,280

Noncontrolling interests’ share of Company-Defined FFO
(1,533
)
 
(1,506
)
 
(3,287
)
 
(3,400
)
Company-Defined FFO attributable to common shares-basic
19,274

 
19,065

 
39,696

 
44,253

Company-Defined FFO attributable to dilutive OP Units
1,490

 
1,365

 
3,076

 
3,113

Company-Defined FFO attributable to common shares-diluted
$
20,764

 
$
20,430

 
$
42,772

 
$
47,366

Company-Defined FFO per share-basic and diluted
$
0.12

 
$
0.10

 
$
0.24

 
$
0.24

Weighted average number of shares outstanding
 
 
 
 
 
 
 
Basic
161,209

 
183,157

 
162,581

 
181,247

Diluted
173,669

 
196,267

 
175,179

 
194,029






 
 
Three Months Ended
 
Six Months Ended
 
 
June 30, 2016
 
March 31, 2016
 
June 30, 2015
 
June 30, 2016
 
June 30, 2015
Total same store real property NOI - cash basis
 
$
31,067

 
$
30,889

 
$
30,945

 
$
61,956

 
$
63,253

2015/2016 Acquisitions/Dispositions
 
5,930

 
8,315

 
6,640

 
14,245

 
18,531

NOI - cash basis
 
$
36,997

 
$
39,204

 
$
37,585

 
$
76,201

 
$
81,784

Straight line rent
 
(205
)
 
(240
)
 
(43
)
 
(446
)
 
(398
)
Net amortization of above- and below-market lease assets and liabilities, and other non-cash adjustments to rental revenue
 
278

 
262

 
126

 
541

 
532

NOI
 
$
37,070

 
$
39,226

 
$
37,668

 
$
76,296

 
$
81,918

Debt related income
 
237

 
238

 
1,584

 
475

 
4,787

Real estate depreciation and amortization expense
 
(20,198
)
 
(19,835
)
 
(19,738
)
 
(40,034
)
 
(40,554
)
General and administrative expenses
 
(2,338
)
 
(2,621
)
 
(2,944
)
 
(4,958
)
 
(5,680
)
Advisory fees, related party
 
(3,671
)
 
(3,765
)
 
(4,497
)
 
(7,436
)
 
(8,796
)
Acquisition-related expenses
 
(474
)
 
(51
)
 
(358
)
 
(525
)
 
(783
)
Impairment of real estate property
 
—

 
(587
)
 
(224
)
 
(587
)
 
(1,624
)
Interest and other income
 
(69
)
 
58

 
163

 
(11
)
 
797

Interest expense
 
(10,422
)
 
(10,961
)
 
(11,275
)
 
(21,383
)
 
(25,256
)
Gain (loss) on extinguishment of debt and financing commitments
 
—

 
5,136

 
(272
)
 
5,136

 
(1,168
)
Gain on sale of real property
 
—

 
41,400

 
—

 
41,400

 
128,667

Net (income) loss attributable to noncontrolling interests
 
(18
)
 
(4,456
)
 
(37
)
 
(4,474
)
 
(8,655
)
Net income (loss) attributable to common stockholders
 
$
117

 
$
43,782

 
$
70

 
$
43,899

 
$
123,653

Webinar and Portfolio Update Call Information
DPF will host a webinar/portfolio update call to review second quarter 2016 performance results and financial metrics on August 17, 2016, at 2:15 p.m. U.S. Mountain Time. Information to access the call is as follows:
Date: Wednesday, August 17, 2016
Time: 2:15 p.m. MT/4:15 p.m. ET
Dial-in Number: 877.742.5590
Conference ID: 44767389
To access the live webinar please visit the Investor Relations page at DPF’s website, www.dividendcapitaldiversified.com.
The webinar replay will be posted when available on the Investor Relations page of DPF’s website.
About Dividend Capital Diversified Property Fund
Dividend Capital Diversified Property Fund is a public reporting, daily NAV vehicle based in Denver, CO that invests in a diversified portfolio of commercial real estate assets. DPF owned 58 properties totaling approximately 9.3 million square feet in 20 geographic markets as of June 30, 2016. More information is available at www.dividendcapitaldiversified.com.
Forward-Looking Information
This material may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “expect(s),” “could,” “should,” and “continue” and similar statements are intended to identify such forward-looking statements. These statements are based on management’s current expectations and beliefs and are subject to a number of risks and uncertainties that could lead to actual results that are materially different than those described in the forward-looking statements. Dividend Capital Diversified Property Fund cannot give assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Dividend Capital Diversified Property Fund’s expectations include, but are not limited to, the uncertainty of funding Dividend Capital Diversified Property





Fund’s future capital needs, delays in the acquisition, development, and construction of real properties, changes in economic conditions generally and the real estate and securities markets specifically, and other risks detailed from time to time in Dividend Capital Diversified Property Fund’s Securities and Exchange Commission reports, particularly the section entitled “Risk Factors” in Item 1A of Dividend Capital Diversified Property Fund’s Annual Report on Form 10-K. Such forward-looking statements pertain only as of the date of this press release. Dividend Capital Diversified Property Fund expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Dividend Capital Diversified Property Fund’s expectations with regard thereto or change in events, conditions, or circumstances on which any statement is based.
Contact
Eric Paul
Dividend Capital
(303) 228-2200




Black Creek Diversified Property Fund Inc. Reports