Attached files
| file | filename |
|---|---|
| EX-99.1 - EXHIBIT 99.1 - HEALTHCARE TRUST OF AMERICA, INC. | q22017earningsrelease.htm |
| EX-10.2 - EXHIBIT 10.2 - HEALTHCARE TRUST OF AMERICA, INC. | exhibit102.htm |
| EX-10.1 - EXHIBIT 10.1 - HEALTHCARE TRUST OF AMERICA, INC. | exbibit101.htm |
| 8-K - 8-K - HEALTHCARE TRUST OF AMERICA, INC. | hta201707318-k.htm |
99.1
MISSION MEDICAL OFFICE PORTFOIO
MISSION VIEJO, CA
Exhibit 99.2
Company Overview
Company Information 3
Second Quarter and Year-to-Date 2017 Highlights 4
Financial Highlights 6
Company Snapshot 7
Financial Information
FFO, Normalized FFO, Normalized FAD and Adjusted EBITDA 8
Capitalization, Interest Expense and Covenants 9
Debt Composition and Maturity Schedule 10
Portfolio Information
Investment Activity 11
Regional Portfolio Distribution and Key Markets and Top 75 MSA Concentration 12
Development Summary and Capital Expenditures 13
Same-Property Performance and NOI 14
Portfolio Diversification by Type, Historical Campus Proximity and Ownership Interests 15
Historical Leased Rate, New and Renewal Leasing Activity and Tenant Lease Expirations 16
Key Health System Relationships and In-House Property Management and Leasing Platform 17
Health System Relationship Highlights 18
Financial Statements
Condensed Consolidated Balance Sheets 19
Condensed Consolidated Statements of Operations 20
Condensed Consolidated Statements of Cash Flows 21
Reporting Definitions 22
Forward-Looking Statements:
Certain statements contained in this report constitute forward-looking statements within the meaning of the safe harbor from civil liability provided
for such statements by the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act). Such statements include, in particular, statements
about our plans, strategies, prospects and estimates regarding future medical office building market performance. Additionally, such statements
are subject to certain risks and uncertainties, as well as known and unknown risks, which could cause actual results to differ materially and in
adverse ways from those projected or anticipated. Therefore, such statements are not intended to be a guarantee of our performance in future
periods. Forward-looking statements are generally identifiable by the use of such terms as “expect,” “project,” “may,” “should,” “could,” “would,”
“intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “opinion,” “predict,” “potential,” “pro forma” or the negative of such terms and
other comparable terminology. Readers are cautioned not to place undue reliance on these forward-looking statements. We cannot guarantee
the accuracy of any such forward-looking statements contained in this report, and we do not intend to publicly update or revise any forward-
looking statements, whether as a result of new information, future events, or otherwise, except as required by law. Any such forward-looking
statements reflect our current views about future events, are subject to unknown risks, uncertainties, and other factors, and are based on a
number of assumptions involving judgments with respect to, among other things, future economic, competitive and market conditions, all of
which are difficult or impossible to predict accurately. To the extent that our assumptions differ from actual results, our ability to meet such
forward-looking statements, including our ability to generate positive cash flow from operations, provide dividends to stockholders, and maintain
the value of our real estate properties, may be significantly hindered. Forward-looking statements express expectations of future events. All
forward-looking statements are inherently uncertain as they are based on various expectations and assumptions concerning future events and
they are subject to numerous known and unknown risks and uncertainties that could cause actual events or results to differ materially from
those projected. Due to these inherent uncertainties, our stockholders are urged not to place undue reliance on forward-looking statements.
Forward-looking statements speak only as of the date made. In addition, we undertake no obligation to update or revise forward-looking
statements to reflect changed assumptions, the occurrence of unanticipated events or changes to projections over time, except as required
by law. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed
on such statements. Additional information concerning us and our business, including additional factors that could materially affect our financial
results, is included herein and in our filings with the SEC.
Table of Contents
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 2
Company Information
Healthcare Trust of America, Inc. (NYSE: HTA) is the largest dedicated owner and operator of medical office buildings (“MOBs”) in the United
States, based on gross leasable area (“GLA”). We provide the real estate infrastructure for the integrated delivery of healthcare services in
highly desirable locations. Over the last decade, we have invested $6.8 billion primarily in MOBs and other healthcare assets comprising 24.0
million square feet of GLA. Our investments are targeted in 15 to 20 key markets that we believe have superior healthcare demographics that
support strong, long-term demand for medical office space. We have achieved, and continue to achieve, critical mass within these key markets
by expanding our presence through accretive acquisitions, and utilizing our in-house operating expertise through our regionally located property
management and leasing platform.
Founded in 2006 and listed on the New York Stock Exchange in 2012, HTA has produced attractive returns for its stockholders that we
believe have significantly outperformed the S&P 500 and US REIT indices. More information about HTA can be found on the Company’s
website at www.htareit.com.
Company Overview
Executive Management
Scott Peters I Chairman, Chief Executive Officer and President
Robert Milligan I Chief Financial Officer, Secretary and Treasurer
Amanda Houghton I Executive Vice President - Asset Management
Keith Konkoli I Executive Vice President - Development
Ann Atkinson I Senior Vice President - Acquisitions
Contact Information
Corporate Headquarters
Healthcare Trust of America, Inc. I NYSE: HTA
16435 North Scottsdale Road, Suite 320
Scottsdale, Arizona 85254
480.998.3478
www.htareit.com
Investor Relations
Robert Milligan I Chief Financial Officer, Secretary and Treasurer
16435 North Scottsdale Road, Suite 320
Scottsdale, Arizona 85254
480.998.3478
info@htareit.com
Transfer Agent
Computershare
P.O. Box 505000
Louisville, KY 40233
888.801.0107
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 3
Second Quarter 2017 Highlights
Operating
• Net Income (Loss) Attributable to Common Stockholders: Decreased to $(5.9) million net loss, compared to Q2 2016. Earnings
per diluted share decreased to $(0.03) per diluted share, compared to Q2 2016. Total revenues increased $26.6 million due to the
continued growth in HTA’s operations, however, the increase in revenues was primarily offset by the increase in transaction
expenses related to second quarter investments, including the loss on extinguishment of debt related to the bridge facility fees paid
in connection with the Duke acquisition.
• Funds From Operations (“FFO”): As defined by the National Association of Real Estate Investment Trusts (“NAREIT”), increased
1.7%, to $54.2 million, compared to Q2 2016. FFO per diluted share decreased 21.1%, to $0.30 per diluted share, compared to Q2
2016.
• Normalized FFO: Increased 23.3%, to $69.6 million, compared to Q2 2016. Normalized FFO per diluted share decreased 2.5%, to
$0.39 per diluted share, compared to Q2 2016.
• Normalized Funds Available for Distribution (“FAD”): Increased 21.1%, to $60.6 million, compared to Q2 2016.
• Same-Property Cash Net Operating Income (“NOI”): Increased $2.2 million, or 3.1%, to $75.0 million, compared to Q2 2016.
Same-Property rental revenue increased $1.6 million, or 1.9%, to $85.6 million, compared to Q2 2016.
Portfolio
• Investments: During the quarter, HTA had investments of $2.6 billion totaling approximately 6.2 million square feet of GLA that were
92% leased as of the date of acquisition and included the following:
◦ HTA announced potential investments of $2.75 billion of the Duke Realty medical office business and development platform
(collectively, the “Duke Assets”), with $2.2 billion closing during the quarter following the exclusion of 11 properties valued
at $494.9 million, primarily subject to rights of first offer and/or rights of first refusal in favor of unrelated third parties. The
Duke Assets totaled approximately 4.9 million square feet of GLA that were 93% leased as of the date of acquisition and
91% of the acquired GLA were located in certain of HTA’s 15 to 20 existing key markets. Of the remaining Duke Assets,
three properties closed in July 2017 for an aggregate purchase price of $131.7 million totaling approximately 245,000
square feet of GLA. The remaining parcel of land for $5.1 million is expected to close in the second half of 2017.
◦ In addition, HTA completed investments of $390.5 million totaling approximately 1.3 million square feet of GLA that were
89% leased as of the date of acquisition and located substantially in certain of HTA’s 15 to 20 key markets.
• Development Platform Acquisition: During the quarter, HTA completed its acquisition of Duke’s development and construction
platform as part of the Duke acquisition. This best-in-class development platform, renamed HTA-Development, has developed over
$1.0 billion in medical real estate assets over the last 10 years. As part of the transition, HTA also announced the appointment of
Keith Konkoli to the newly created position of Executive Vice President - Development. Mr. Konkoli will be responsible for HTA-
Development’s national development and construction activities and will lead a team of 15 experienced professionals.
• Leasing: HTA entered into new and renewal leases on approximately 519,000 square feet of GLA, or 2.2%, of its portfolio. Tenant
retention for the Same-Property portfolio was 78% by GLA for the quarter, which included approximately 544,000 square feet of GLA
of expiring leases. Renewal leases included tenant improvements of $1.51 per square foot per year of the lease term and
approximately one week of free rent per year of the lease term.
Capital Markets
• Equity: During the quarter, HTA issued and sold $1.7 billion of equity comprised of $1.6 billion from the sale of common stock in an
underwritten public offering at an average price of $28.50 per share, and $125.7 million from the sale of common stock under the
ATM at an average price of $31.45 per share.
• Debt: In June 2017, HTA issued in a public offering a total of $900.0 million in senior unsecured notes at an average interest rate of
3.4% and an average duration of 7.7 years and consist of $400.0 million of 5-year unsecured senior notes, with a coupon of 2.95%
per annum, and $500.0 million of 10-year unsecured senior notes, with a coupon of 3.75% per annum. HTA also entered into a
$286.0 million financing with the seller in the Duke acquisition with a 4.0% per annum interest rate and an outside maturity date in
2021.
Company Overview
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 4
Year-to-Date 2017 Highlights
Operating
• Net Income (Loss) Attributable to Common Stockholders: Decreased to $7.6 million, compared to year-to-date 2016. Earnings
per diluted share decreased to $0.05 per diluted share, compared to year-to-date 2016. Total revenues increased $43.7 million due
to the continued growth in HTA’s operations, however, the increase in revenues was primarily offset by the increase in transaction
expenses related to second quarter investments, including the loss on extinguishment of debt related to the bridge facility fees paid
in connection with the Duke acquisition.
• FFO: As defined by NAREIT, increased 13.7%, to $114.4 million, compared to year-to-date 2016. FFO per diluted share decreased
5.4%, to $0.70 per diluted share, compared to year-to-date 2016.
• Normalized FFO: Increased 19.5%, to $129.8 million, compared to year-to-date 2016. Normalized FFO per diluted share
decreased 1.3% to $0.79 per diluted share, compared to year-to-date 2016.
• Normalized FAD: Increased 15.0%, to $113.5 million, compared to year-to-date 2016.
• Same-Property Cash NOI: Increased $4.3 million, or 3.1%, to $144.4 million, compared to year-to-date 2016. Same-Property
rental revenue increased $3.5 million, or 2.2%, to $162.5 million, compared to year-to-date 2016.
Portfolio
• Investments: HTA completed investments of $2.6 billion, which included a 50% ownership in a unconsolidated joint venture, to
acquire medical office buildings and development properties totaling approximately 6.3 million square feet of GLA that were 92%
leased as of the date of acquisition.
• Dispositions: HTA completed the disposition of a medical office building located in Texas for a gross sales price of $5.0 million
(approximately 48,000 square feet of GLA).
• Leasing: HTA entered into new and renewal leases on approximately 1.3 million square feet of GLA, or 5.4%, of its portfolio. Tenant
retention for the Same-Property portfolio was 78% by GLA year-to-date, which included approximately 1.0 million square feet of
expiring leases. Renewal leases included tenant improvements of $1.47 per square foot per year of the lease term and
approximately one week of free rent per year of the lease term.
• Leased Rate: At the end of the quarter, HTA had a leased rate for its portfolio of 92.0% by GLA and 91.6% for its Same-Property
portfolio.
Balance Sheet and Capital Markets
• Balance Sheet: At the end of the quarter, HTA had total leverage of 30.4% measured as debt to market capitalization, and 6.3x
measured as debt to Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”). Total liquidity at
the end of the quarter was $935.9 million, including $844.5 million of availability under its unsecured revolving credit facility and
$91.4 million of cash and cash equivalents.
• Debt and Equity: During the six months ended June 30, 2017, HTA issued and sold approximately $1.7 billion in equity at an
average price of $28.70 per share and issued $1.2 billion in debt. These transactions were used to substantially finance HTA’s 2017
investments and position its investment grade balance sheet for future growth.
Subsequent Events
• Investments: Subsequent to the end of the quarter, HTA completed investments with an aggregate purchase price of $149.2 million
totaling approximately 292,000 square feet of GLA that was 99% leased as of the acquisition date and located substantially in
certain of HTA’s key markets.
• Dividends: On July 31 2017, HTA’s Board of Directors increased the quarterly dividend run rate by 1.7% to $0.305 per share of
common stock, representing an annualized rate of $1.22 per share of common stock.
• Debt: On July 27, 2017, HTA entered into an amended and restated $1.3 billion unsecured credit agreement which increased the
amount available under the unsecured revolving credit facility to $1.0 billion and extended the maturities of the unsecured revolving
credit facility to June 30, 2022 and February 1, 2023 for the $300 million unsecured term loan. The interest rate on the unsecured
credit agreement decreased to adjusted LIBOR plus a margin ranging from 0.83% to 1.55% per annum based on HTA’s credit rating.
The other existing terms of the unsecured credit agreement before the amendment remained substantially unchanged.
Company Overview
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 5
(1) Refer to pages 22 and 23 for the reporting definitions of NOI, Adjusted EBITDA, FFO, Normalized FFO and Normalized FAD.
(2) Refer to page 14 for a reconciliation of GAAP Net Income to NOI.
(3) Refer to page 8 for the reconciliations of GAAP Net Income Attributable to Common Stockholders to FFO, Normalized FFO, Normalized FAD and Net Income to Adjusted EBITDA.
(4) Calculated as the increase in Same-Property Cash NOI for the quarter as compared to the same period in the previous year.
(5) Calculated as Adjusted EBITDA divided by interest expense (excluding change in fair market value of derivatives) and scheduled principal payments.
(6) Calculated as the common stock price on the last trading day of the period multiplied by the total diluted common shares outstanding at the end of the period, plus total debt
outstanding at the end of the period. Refer to page 9 for details.
Financial Highlights
(unaudited and dollars in thousands, except per share data)
Three Months Ended
2Q17 1Q17 4Q16 3Q16 2Q16
INCOME ITEMS
Revenues $ 139,879 $ 124,347 $ 122,039 $ 118,340 $ 113,234
NOl (1)(2) 96,419 85,327 83,587 81,455 78,173
Adjusted EBITDA (1)(3) 442,316 319,132 312,340 311,776 294,256
FFO (1)(3) 54,185 60,231 60,944 53,972 53,273
Normalized FFO (1)(3) 69,643 60,133 59,513 57,132 56,461
Normalized FAD (1)(3) 60,618 52,865 52,197 49,222 50,061
Net income attributable to
common stockholders per diluted share $ (0.03) $ 0.09 $ 0.11 $ 0.04 $ 0.09
FFO per diluted share 0.30 0.41 0.42 0.38 0.38
Normalized FFO per diluted share 0.39 0.41 0.41 0.40 0.40
Same-Property Cash NOI growth (4) 3.1% 3.2% 2.9% 3.3% 3.1%
Fixed charge coverage ratio (5) 4.39x 4.30x 4.20x 4.08x 4.06x
As of
2Q17 1Q17 4Q16 3Q16 2Q16
ASSETS
Gross real estate investments $ 6,796,889 $ 4,360,906 $ 4,320,613 $ 4,255,076 $ 4,058,071
Total assets 6,366,758 3,753,017 3,747,844 3,715,890 3,532,289
CAPITALIZATION
Total debt $ 2,784,162 $ 1,811,208 $ 1,768,905 $ 1,712,598 $ 1,631,642
Total capitalization (6) 9,154,526 6,409,685 6,020,188 6,476,814 6,227,027
Total debt/market capitalization 30.4% 28.3% 29.4% 26.4% 26.2%
Company Overview
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 6
Investments in Real Estate (1) $ 6.8
Total portfolio GLA (2) 24.0
Leased rate 92%
Same-Property portfolio tenant retention rate (YTD) (3) 78%
% of GLA on-campus/aligned 97%
% of invested dollars in key markets & top 75 MSAs (4) 94%
Investment grade tenants (5) 46%
Credit rated tenants (5) 61%
Weighted average remaining lease term for all buildings (6) 5.9
Weighted average remaining lease term for single-tenant buildings (6) 8.4
Weighted average remaining lease term for multi-tenant buildings (6) 4.6
Credit ratings (by Moody’s and Standard & Poor’s) Baa2(Negative)/BBB(Stable)
Cash and cash equivalents (2) $ 91.4
Debt/market capitalization 30.4%
Weighted average interest rate per annum on portfolio debt (7) 3.47%
Building Type Presence in Top MSAs (8)
Company Snapshot
(as of June 30, 2017)
Company Overview
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 7
(1) Amount presented in billions. Refer to page 22 for the reporting definition of Investments in Real Estate.
(2) Amounts presented in millions.
(3) Refer to page 23 for the reporting definition of Retention.
(4) Refer to page 22 for the reporting definition of Metropolitan Statistical Area.
(5) Amounts based on annualized base rent.
(6) Amounts presented in years.
(7) Includes the impact of interest rate swaps.
(8) Refer to page 12 for a detailed table of HTA’ s Key Markets and Top 75 MSA Concentration.
% of Portfolio (based on GLA) % of Portfolio (based on invested dollars)
Medical Office Buildings
94%
Hospitals
5%
Senior Care
1%
Additional Top 75
MSAs
41.4%All Other Markets
6.4%
Dallas, TX
12.1%
Houston, TX
6.3%
Boston, MA
6.0%
Atlanta, GA
4.8%
Indianapolis, IN
4.1%
Hartford/
New Haven, CT
3.9% Phoenix, AZ
3.9%Tampa, FL
3.8%
Orange County/Los
Angeles, CA
3.7%
Denver, CO
3.6%
FFO, Normalized FFO and Normalized FAD Three Months Ended Six Months Ended
2Q17 2Q16 2Q17 2Q16
Net (loss) income attributable to common stockholders $ (5,918) $ 13,074 $ 7,627 $ 22,934
Depreciation and amortization expense related to investments in real estate 54,968 44,411 101,657 81,932
Gain on sale of real estate, net — (4,212) (3) (4,212)
Impairment 5,093 — 5,093 —
Proportionate share of joint venture depreciation, amortization and other
adjustments 42 — 42 —
FFO attributable to common stockholders $ 54,185 $ 53,273 $ 114,416 $ 100,654
Transaction expenses (1) 430 2,062 714 3,875
(Gain) loss on change in fair value of derivative financial instruments, net (45) 658 (884) 3,450
Loss on extinguishment of debt, net 10,386 22 10,418 22
Noncontrolling income from partnership units included in diluted shares 44 446 469 591
Other normalizing items, net (2) 4,643 — 4,643 (16)
Normalized FFO attributable to common stockholders $ 69,643 $ 56,461 $ 129,776 $ 108,576
Other income (6) (72) (14) (125)
Non-cash compensation expense 1,309 1,230 3,839 3,033
Straight-line rent adjustments, net (1,616) (1,024) (2,825) (2,475)
Amortization of (below) and above market leases/leasehold interests and
corporate assets, net 511 413 784 1,153
Deferred revenue - tenant improvement related (11) (7) (11) (7)
Amortization of deferred financing costs and debt discount/premium, net 853 776 1,639 1,493
Recurring capital expenditures, tenant improvements and leasing
commissions (10,065) (7,716) (19,705) (12,984)
Normalized FAD attributable to common stockholders $ 60,618 $ 50,061 $ 113,483 $ 98,664
Net (loss) income attributable to common stockholders per diluted share $ (0.03) $ 0.09 $ 0.05 $ 0.17
FFO adjustments per diluted share, net 0.33 0.29 0.65 0.57
FFO attributable to common stockholders per diluted share $ 0.30 $ 0.38 $ 0.70 $ 0.74
Normalized FFO adjustments per diluted share, net 0.09 0.02 0.09 0.06
Normalized FFO attributable to common stockholders per diluted share $ 0.39 $ 0.40 $ 0.79 $ 0.80
Weighted average diluted common shares outstanding (3) 180,672 140,512 163,490 135,876
Adjusted EBITDA
Three Months
Ended
2Q17
Net loss $ (5,852)
Depreciation and amortization expense 55,353
Interest expense and net change in fair value of derivative financial
instruments 17,900
Proportionate share of joint venture depreciation, amortization and other
adjustments 42
EBITDA $ 67,443
Transaction expenses 430
Impairment 5,093
Loss on extinguishment of debt, net 10,386
Non-cash compensation expense 1,309
Pro forma impact of acquisitions 21,275
Other normalizing items, net 4,643
110,579
Adjusted EBITDA $ 442,316
FFO, Normalized FFO, Normalized FAD and Adjusted EBITDA
(unaudited and in thousands, except per share data)
Financial Information
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 8
(1) For the three and six months ended 2Q17, amounts have been adjusted to reflect the prospective presentation of the early adoption of ASU 2017-01 as of January 1, 2017.
(2) For the three and six months ended 2Q17, other normalizing items include $4.6 million of compensation and severance payments to Duke employees pursuant to the Duke purchase
agreements in connection with the Duke acquisition that were included in transaction expenses on HTA’ s condensed consolidated statements of operations. In addition, other
normalizing items excludes lease termination fees as they are deemed to be generated in the ordinary course of business.
(3) For the three months ended 2Q17 these securities are anti-dilutive on a GAAP basis as a result of HTA’ s net loss, but are considered dilutive on a non-GAAP basis in periods where
we report non-GAAP net income.
.
Capitalization
Unsecured revolving credit facility $ —
Unsecured term loans 500,000
Unsecured senior notes 1,850,000
Secured mortgage loans 455,147
Deferred financing costs, net (15,124)
Discount, net (5,861)
Total debt $ 2,784,162
Stock price (as of June 30, 2017) $ 31.11
Total diluted common shares outstanding 204,769
Equity capitalization $ 6,370,364
Total capitalization $ 9,154,526
Total undepreciated assets $ 7,274,486
Debt/market capitalization 30.4%
Debt/undepreciated assets 38.3%
Debt/Adjusted EBITDA ratio 6.3x
Equity
70%
Secured
Debt
5%
Unsecured
Debt
25%
Financial Information
Capitalization, Interest Expense and Covenants
(as of June 30, 2017, dollars and shares in thousands, except stock price)
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 9
Interest Expense
Covenants
Three Months Ended Six Months Ended
2Q17 2Q16 2Q17 2Q16
Interest related to derivative financial instruments $ 239 $ 659 $ 563 $ 1,304
(Gain) loss on change in fair value of derivative financial instruments,
net (1) (45) 658 (884) 3,450
Total interest related to derivative financial instruments, including net
change in fair value of derivative financial instruments
194 1,317 (321) 4,754
Interest related to debt 17,706 13,989 33,764 28,117
Total interest expense $ 17,900 $ 15,306 $ 33,443 $ 32,871
Interest expense excluding net change in fair value of derivative
financial instruments $ 17,945 $ 14,648 $ 34,327 $ 29,421
Bank Loans Required 2Q17
Total leverage ≤ 60% 36%
Secured leverage ≤ 30% 6%
Fixed charge coverage ≥ 1.50x 4.39x
Unencumbered leverage ≤ 60% 34%
Unencumbered coverage ≥ 1.75x 4.30x
Senior Notes Required 2Q17
Total leverage ≤ 60% 40%
Secured leverage ≤ 40% 6%
Unencumbered asset coverage ≥ 150% 271%
Interest coverage ≥ 1.50x 4.45x
(1) In March 2017, HTA designated its derivative financial instruments as cash flow hedges.
Unsecured Revolving Credit Facility due 2020 Secured Mortgage Loans
Unsecured Term Loan due 2019 Unsecured Term Loan due 2023
Unsecured Senior Notes due 2021 Unsecured Senior Notes due 2022
Unsecured Senior Notes due 2023 Unsecured Senior Notes due 2026
Unsecured Senior Notes due 2027
$2,000,000
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0
2017 2018 2019 2020 2021 Thereafter
Financial Information
Debt Composition and Maturity Schedule
(as of June 30, 2017, dollars in thousands)
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 10
Unsecured
Revolving
Credit Facility
due 2020 (1)
Secured
Mortgage
Loans
Unsecured
Term Loan
due 2019 (2)
Unsecured
Senior Notes
due 2021
Unsecured
Senior Notes
due 2022
Unsecured
Senior Notes
due 2023
Unsecured
Term Loan
due 2023
Unsecured
Senior Notes
due 2026
Unsecured
Senior Notes
due 2027 Total
2017 $ — $ 2,291 $ — $ — $ — $ — $ — $ — $ 2,291
2018 — 100,827 — — — — — — 100,827
2019 — 105,940 300,000 — — — — — 405,940
2020 — 144,892 — — — — — — 144,892
2021 — 3,933 — 300,000 — — — — 303,933
Thereafter — 97,264 — — 400,000 300,000 200,000 350,000 500,000 1,847,264
Subtotal — 455,147 300,000 300,000 400,000 300,000 200,000 350,000 500,000 2,805,147
Deferred financing
costs, net — (227) (1,342) (1,740) (2,791) (1,980) (1,799) (1,478) (3,767) (15,124)
Premiums
(discounts), net — 1,768 — (1,312) (245) (1,455) — (2,090) (2,527) (5,861)
Total $ — $ 456,688 $ 298,658 $ 296,948 $ 396,964 $ 296,565 $ 198,201 $ 346,432 $ 493,706 $ 2,784,162
Stated rate (1) 2.30% 4.31% 2.40% 3.38% 2.95% 3.70% 2.90% 3.50% 3.75% 3.45%
Hedged rate (2) 2.30% 4.46% 2.40% 3.38% 2.95% 3.70% 2.93% 3.50% 3.75% 3.47%
Debt Composition
(1) The stated rate on the debt instrument as of the end of the period.
(2) The effective rate incorporates any swap instruments that serve to fix variable rate debt, as of the end of the period.
(3) Rate does not include the 20 basis point facility fee that is payable on the entire $850 million revolving credit facility.
(4) Does not reflect the 1-year extension at the option of the borrower which could extend the term loan to 2020.
Debt Maturity Schedule
$2,291
$100,827
$405,940
$144,892
$303,933
$1,847,264
(4)
(3)
Property Market Date Acquired
% Leased at
Acquisition Purchase Price GLA
MatureWell MOB College Station, TX January 100% $ 13,600 23
Medical Village of Tampa MOB Tampa, FL March 100 21,100 55
Dignity MOB (11 buildings) AZ & CA May 87 150,000 591
Northwest Houston MOB (4 buildings) Cypress/Houston, TX May 99 137,600 370
Texas Health MOB Fort Worth, TX May 100 38,500 78
Duke Asset Acquisition (68 properties & 1 land
parcel) (1) Various May/June 93 2,169,129 4,916
Optimal MOB (5 buildings) Tampa, FL June 100 47,833 128
Lake Norman MOB (3 buildings) Charlotte, NC June 54 16,590 143
Total $ 2,594,352 6,304
Portfolio Information
Investment Activity
(as of June 30, 2017, dollars and GLA in thousands)
2017 Acquisitions
Annual Investments (2)
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 11
(1) includes HTA’s investment in an unconsolidated joint venture of $68.8 million as of the date of acquisition.
(2) Excludes real estate note receivables and corporate assets.
2017 Dispositions
As of June 30, 2017, HTA has invested $6.8 billion primarily in MOBs and other healthcare assets comprising 24.0 million square feet of GLA.
Acquisitions Dispositions
$2,400,000
$1,900,000
$1,400,000
$900,000
$400,000
-$100,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Property Market Date Disposed Disposition Price GLA
Baylor Medical MOB Waxahachie, TX February $ 5,000 48
$413,150
$542,976
$455,950
$802,148
$68,314
($39,483)
$294,937
$397,826
$271,510
$439,530
$700,764
($35,685)($82,885) ($5,000)
$2,594,352
Region Investment % of Investment Total GLA % of Portfolio
Annualized
Base Rent (1)
% of
Annualized
Base Rent
Southwest $ 2,612,365 38.3% 8,110 33.8% $ 175,055 34.5%
Southeast 1,915,948 28.0 7,132 29.7 148,947 29.4
Northeast 1,266,889 18.5 4,690 19.6 103,939 20.5
Midwest 1,029,365 15.1 4,039 16.8 78,383 15.5
Northwest 7,750 0.1 23 0.1 528 0.1
Total $ 6,832,317 100% 23,994 100% $ 506,852 100%
Portfolio Information
Regional Portfolio Distribution and Key Markets and Top 75 MSA Concentration
(as of June 30, 2017, dollars and GLA in thousands)
Regional Portfolio Distribution
Key Markets and Top 75 MSA Concentration (2)
(1) Refer to page 22 for the reporting definition of Annualized Base Rent.
(2) Key markets are titled as such based on HTA’s concentration in the respective MSA.
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 12
Key Markets Investment
% of
Investment Total GLA % of Portfolio
Annualized
Base Rent
% of
Annualized
Base Rent
Dallas, TX $ 824,024 12.1% 1,934 8.1% $ 45,777 9.0%
Houston, TX 430,979 6.3 1,583 6.6 31,341 6.2
Boston, MA 410,730 6.0 1,037 4.3 32,396 6.4
Atlanta, GA 325,186 4.8 1,088 4.5 22,648 4.5
Indianapolis, IN 281,768 4.1 1,396 5.8 24,174 4.8
Hartford/New Haven, CT 269,177 3.9 953 4.0 20,097 4.0
Phoenix, AZ 267,781 3.9 1,315 5.5 24,163 4.8
Tampa, FL 262,614 3.8 757 3.2 16,645 3.3
Orange County/Los Angeles, CA 255,042 3.7 615 2.6 14,893 2.9
Denver, CO 246,957 3.6 538 2.2 16,919 3.3
Miami, FL 223,537 3.3 996 4.1 21,042 4.1
Chicago, IL 190,778 2.8 382 1.6 9,706 1.9
Raleigh, NC 185,564 2.7 608 2.5 14,840 2.9
Albany, NY 179,253 2.6 881 3.7 16,091 3.2
Greenville, SC 179,070 2.6 965 4.0 18,178 3.6
Austin, TX 164,425 2.4 408 1.7 8,193 1.6
Milwaukee, WI 156,782 2.3 498 2.1 11,656 2.3
Orlando, FL 156,300 2.3 510 2.1 10,609 2.1
Pittsburgh, PA 148,612 2.2 1,094 4.6 20,540 4.0
White Plains, NY 126,144 1.9 333 1.4 8,405 1.7
Top 20 MSAs 5,284,723 77.3 17,891 74.6 388,313 76.6
Additional Top 75 MSAs 1,107,192 16.3 4,334 18.0 84,161 16.6
Total Key Markets & Top 75
MSAs $ 6,391,915 93.6% 22,225 92.6% $ 472,474 93.2%
Portfolio Information
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 13
Development Market Total GLA % Leased
Unstabilized
Main Line Bryn Mawr MOB Philadelphia, PA 101 57%
Centegra Health MOB Chicago, IL 81 83
Stabilized
BS&W EMC - Grand Prairie MOB Fort Worth, TX 27 100
Baptist Memorial Oxford MOB Memphis, TN 80 90
UNC REX Holly Springs MOB Raleigh, NC 45 100
Memorial Hermann Plaza II MOB Houston, TX 99 100
Providence Facey MOB Orange County, CA 37 100
Total 470 90%
Development
Estimated
Completion Total Cost
Construction in
Progress Costs to Complete
Unstabilized
Main Line Bryn Mawr MOB 1Q17 $ 32,296 $ 29,466 $ 2,830
Centegra Health MOB 1Q17 24,625 23,237 1,388
Stabilized
BS&W EMC - Grand Prairie MOB 4Q17 14,775 7,741 7,034
Baptist Memorial Oxford MOB 4Q17 19,091 16,639 2,452
UNC REX Holly Springs MOB 4Q17 13,712 5,778 7,934
Memorial Hermann Plaza II MOB 2Q18 20,674 856 19,818
Providence Facey MOB 2Q18 17,980 988 16,993
Total $ 143,153 $ 84,705 $ 58,449
Stabilized Yield 6.8%
Three Months Ended
2Q17
Recurring capital expenditures $ 3,857
Tenant improvements - 2nd generation 3,178
Lease commissions 3,030
Total recurring capital expenditures $ 10,065
Capital expenditures - 1st generation/acquisition 1,077
Tenant improvements - 1st generation 2,258
Redevelopment 348
Total capital expenditures $ 13,748
Development Summary and Capital Expenditures
(as of June 30, 2017, dollars and GLA in thousands)
Development Summary - Property Information
Development Summary - Financial Information
Capital Expenditures
Three Months Ended Sequential Year-Over-Year
2Q17 1Q17 2Q16 $ Change % Change $ Change % Change
Rental revenue $ 85,571 $ 85,645 $ 83,966 $ (74) (0.1)% $ 1,605 1.9%
Tenant recoveries 22,906 22,494 21,158 412 1.8 1,748 8.3
Total rental income 108,477 108,139 105,124 338 0.3 3,353 3.2
Expenses 33,435 33,455 32,329 (20) (0.1) 1,106 3.4
Same-Property Cash NOI $ 75,042 $ 74,684 $ 72,795 $ 358 0.5 % $ 2,247 3.1%
As of
2Q17 1Q17 2Q16
Number of buildings 305 305 305
GLA 15,899 15,898 15,900
Leased GLA, end of period 14,561 14,560 14,560
Leased %, end of period 91.6% 91.6% 91.6%
NOI (1) Three Months Ended
2Q17 2Q16
Net (loss) income $ (5,852) $ 13,516
General and administrative expenses 8,472 6,813
Transaction expenses (2) 5,073 2,062
Depreciation and amortization expense 55,353 44,738
Impairment 5,093 —
Interest expense and net change in fair value of derivative financial instruments 17,900 15,306
Gain on sale of real estate, net — (4,212)
Loss on extinguishment of debt, net 10,386 22
Other income (6) (72)
NOI $ 96,419 $ 78,173
NOI percentage growth 23.3%
NOI $ 96,419 $ 78,173
Straight-line rent adjustments, net (1,616) (1,024)
Amortization of (below) and above market leases/leasehold interests, net and lease termination fees 126 77
Cash NOI $ 94,929 $ 77,226
Notes receivable interest income (294) —
Non Same-Property Cash NOI (19,593) (4,431)
Same-Property Cash NOI $ 75,042 $ 72,795
Same-Property Cash NOI percentage growth 3.1%
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 14
Portfolio Information
Same-Property Performance and NOI
(as of June 30, 2017, unaudited and dollars and GLA in thousands)
Same-Property Performance
(1) Refer to pages 22 and 23 for the reporting definitions of NOI, Cash NOI and Same-Property Cash NOI.
(2) For the period ended 2Q17, amounts have been adjusted to reflect the prospective presentation of the early adoption of ASU 2017-01 as of January 1, 2017.
As of
2Q17 1Q17 4Q16 3Q16 2Q16
Off-campus aligned 26% 29% 30% 29% 30%
On-campus 71 67 67 68 67
On-campus/aligned 97% 96% 97% 97% 97%
Off-campus/non-aligned 3 4 3 3 3
Total 100% 100% 100% 100% 100%
Number of
Buildings
Number of
States GLA
% of Total
GLA
Annualized
Base Rent
% of
Annualized
Base Rent
Medical Office Buildings
Single-tenant 116 22 6,294 26.2% $ 134,960 26.6%
Multi-tenant 309 31 16,236 67.7 330,554 65.3
Other Healthcare Facilities
Hospitals 20 7 1,109 4.6 36,096 7.1
Senior care 3 1 355 1.5 5,242 1.0
Total 448 33 23,994 100% $ 506,852 100%
Number of
Buildings
Number of
States GLA
% of Total
GLA
Annualized
Base Rent
% of
Annualized
Base Rent
Net-Lease/Gross-Lease
Net-lease 293 30 15,267 63.6% $ 330,781 65.3%
Gross-lease 155 20 8,727 36.4 176,071 34.7
Total 448 33 23,994 100% $ 506,852 100%
(1) Percentages shown as percent of total GLA.
(2) Refer to page 23 for the reporting definitions of Off-campus/non-aligned and On-campus/aligned.
(3) Refer to pages 22 and 23 for the reporting definitions of Customary Health System Restrictions, Economic with Limited Restrictions, and Occupancy Health System Restrictions.
Portfolio Information
Portfolio Diversification by Type, Historical Campus Proximity and Ownership Interests
(as of June 30, 2017, dollars and GLA in thousands)
Portfolio Diversification by Type
Historical Campus Proximity (1)(2)
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 15
Ownership Interests (3)
Number of
Buildings GLA
Annualized
Base Rent
% of
Annualized
Base Rent
As of (1)
2Q17 1Q17 4Q16 3Q16 2Q16
Fee Simple 304 14,782 $ 318,098 63% 62% 69% 68% 68% 68%
Customary Health System
Restrictions 129 8,222 167,940 33 34 26 26 26 26
Economic with Limited
Restrictions 5 262 6,684 1 1 1 2 2 2
Occupancy Health System
Restrictions 10 728 14,130 3 3 4 4 4 4
Leasehold Interest Subtotal 144 9,212 188,754 37 38 31 32 32 32
Total 448 23,994 $ 506,852 100% 100% 100% 100% 100% 100%
Total GLA Average Term (1)
Average Base Rent (2) Tenant
Improvements (2)
Leasing
Commissions (2) Expiring Starting
1Q 2017
New Leases 172 5.5 $ 21.60 $ 22.51 $ 18.09 $ 2.28
Renewal Leases 604 4.9 23.18 22.64 7.16 1.24
Total 1Q 2017 776 5.0 $ 23.07 $ 22.63 $ 9.62 $ 1.48
2Q 2017
New Leases 107 5.8 $ 24.76 $ 23.97 $ 20.46 $ 1.75
Renewal Leases 412 4.4 21.92 22.19 6.64 0.94
Total 2Q 2017 519 4.7 $ 22.19 $ 22.36 $ 9.49 $ 1.11
YTD 2017
New Leases 279 5.6 $ 23.16 $ 23.23 $ 18.97 $ 2.08
Renewal Leases 1,016 4.7 22.67 22.46 6.96 1.12
Total YTD 2017 1,295 4.9 $ 22.71 $ 22.52 $ 9.57 $ 1.33
As of
2Q17 1Q17 4Q16 3Q16 2Q16
Total portfolio leased rate 92.0% 91.8% 91.9% 91.8% 92.2%
On-campus/aligned leased rate 92.0% 91.8% 91.9% 91.8% 92.3%
Off-campus/non-aligned leased rate 92.3% 90.3% 90.1% 90.8% 89.4%
Total portfolio occupancy rate 91.1% 91.0% 91.2% 91.3% 91.6%
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 16
Portfolio Information
Historical Leased Rate, New and Renewal Leasing Activity and Tenant Lease Expirations
(as of June 30, 2017, dollars and GLA in thousands)
New and Renewal Leasing Activity
Historical Leased Rate
Expiration
Number of
Expiring Leases
Total GLA of
Expiring Leases
% of GLA of
Expiring Leases
Annualized Base
Rent of Expiring
Leases
% of Total
Annualized
Base Rent
Month-to-month 135 328 1.5% $ 6,743 1.3%
2017 257 744 3.5 16,975 3.3
2018 437 1,861 8.6 41,033 8.1
2019 379 1,746 8.1 45,441 9.0
2020 296 1,224 5.7 30,300 6.0
2021 393 2,175 10.1 47,691 9.4
2022 261 1,597 7.4 38,277 7.5
2023 116 1,086 5.0 22,573 4.5
2024 136 1,713 7.9 38,363 7.6
2025 110 696 3.2 14,964 3.0
2026 93 765 3.6 14,775 2.9
Thereafter 874 7,631 35.4 189,717 37.4
Total 3,487 21,566 100% $ 506,852 100%
Tenant Lease Expirations
(1) Amounts presented in years.
(2) Amounts presented per square feet.
Health System
Weighted
Average
Remaining
Lease Term (2)
Credit
Rating
Total Leased
GLA
% of
Leased
GLA
Annualized
Base Rent
% of
Annualized
Base Rent
Baylor Scott & White Health 8 Aa3 738 3.4% $ 19,095 3.8%
Highmark-Allegheny Health Network (3) 5 Baa2 914 4.2 17,615 3.5
Community Health Systems (TN) 6 B2 737 3.4 15,790 3.1
Greenville Health System 7 A1 798 3.7 15,415 3.0
Kindred Healthcare 7 B2 438 2.0 13,041 2.6
Select Medical Group 7 B3 278 1.3 11,726 2.3
Tufts Medical Center 10 Aa2 252 1.2 9,952 2.0
Steward Health Care System 9 B2 380 1.8 9,418 1.9
Hospital Corporation of America 4 B1 356 1.7 9,008 1.8
Tenet Healthcare System 8 B2 379 1.8 8,971 1.8
Providence St. Joseph Health 2 Aa3 262 1.2 8,682 1.7
Ascension Health 2 Aa2 288 1.3 8,262 1.6
SCL Health 14 Aa3 167 0.8 8,150 1.6
Harbin Clinic 10 N/A 313 1.5 6,601 1.3
Aurora Health Care 7 A2 277 1.3 6,385 1.3
Adventist Health 4 Aa2 294 1.4 6,384 1.3
Marion County Health & Hospitals (4) 26 Aa1 273 1.3 5,929 1.2
Total 7,144 33.3% $ 180,424 35.8%
As of June 30, 2017, HTA’s in-house property management and leasing platform operated approximately 22.4 million square feet of GLA, or 93%, of HTA’s
total portfolio.
Portfolio Information
Key Health System Relationships and In-House Property Management and Leasing Platform
(as of June 30, 2017, dollars and GLA in thousands, except as otherwise noted)
Key Health System Relationships (1)
In-House Property Management and Leasing Platform
(1) The amounts in this table illustrate only direct leases with selected top health systems in the HTA portfolio and is not inclusive of all HTA’s health system tenants.
(2) Amounts presented in years.
(3) Credit rating refers to Highmark, Inc.
(4) HTA owns a 50% interest in this unconsolidated joint venture.
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 17
Key Market
Portfolio Property
Regional Offices
(includes corporate headquarters)
On-site Management Offices
Adventist Health (Aa2), headquartered in Roseville, California, serves more than 75 communities in the western states. Adventist Health
consists of 20 hospitals, more than 280 clinics, 14 home care agencies, 7 hospice agencies, 4 joint-venture retirement communities, and
approximately 5,000 medical staff. In 2016, Adventist Health had more than 6.3 million patient visits.
Ascension Health (Aa2), located in St. Louis, Missouri, is the largest non-profit health system in the United States which includes
approximately 150,000 associates and 36,000 aligned providers. Ascension Health operates 2,500 sites including 141 hospitals and 30 senior
living facilities located in 22 states and the District of Columbia. In 2016, Ascension Health had over 39 million patient visits to their care
locations.
Baylor Scott & White Health (Aa3), headquartered in Dallas, Texas, is the largest not-for-profit health care system in Texas. Baylor Scott &
White Health was started in 2013 with the combination of Baylor Health Care System and Scott & White Healthcare. BS&W includes 48
hospitals, more than 1,000 patient care sites, and more than 9,600 active physicians. BS&W provides inpatient, outpatient, rehabilitation, and
emergency medical services helping 5.1 million patients annually.
Community Health Systems (TN) (B2), headquartered in Franklin, Tennessee, is one of the nation’s leading operators of general acute care
hospitals. The organization includes 137 affiliated hospitals in 21 states with approximately 123,000 employees and 20,000 physicians.
Affiliated hospitals are dedicated to providing quality healthcare for local residents and contribute to the economic development of their
communities. Based on the unique needs of each community served, these hospitals offer a wide range of diagnostic, medical and surgical
services in inpatient and outpatient settings.
Greenville Health System (A1), located in Greenville, South Carolina, is a public not-for-profit academic healthcare delivery system committed
to medical excellence through clinical care, education and research. GHS is a health resource for its community and a leader in transforming
the delivery of healthcare for the benefit of people and communities served. The University of South Carolina School of Medicine Greenville is
located on GHS’ Greenville Memorial Medical Campus. The medical school is focused on transforming healthcare by training physicians to
connect with communities, patients, colleagues and technology in a new, more progressive way.
Highmark-Allegheny Health Network (Baa2), based in Pittsburgh, Pennsylvania, is a diversified healthcare partner that serves members
across the United States through its businesses in health insurance, dental insurance, vision care and reinsurance. In 2013, Highmark and
West Penn Allegheny combined to create an integrated care delivery model which they believe will preserve an important community asset that
provides high-quality, efficient health care for patients. Highmark’s mission is to deliver high quality, accessible, understandable and affordable
experiences, outcomes and solutions to their customers.
Hospital Corporation of America (B1), based in Nashville, Tennessee, HCA was one of the nation’s first hospital companies. Today, they are
a company comprised of locally managed facilities that includes approximately 171 hospitals, 118 freestanding surgery centers in 20 states and
the United Kingdom employing approximately 233,000 people. Approximately four to five percent of all inpatient care delivered in the country
today is provided by HCA facilities. HCA is committed to the care and improvement of human life and strives to deliver high quality, cost
effective healthcare in the communities they serve.
Providence St. Joseph Health (Aa3), based in Seattle, Washington and Irvine, California, is held together by Providence Health and Services
and St. Joseph Health, a not-for-profit health and social services system that will serve as the parent organization for more than 100,000
caregivers (employees) across seven states.
Steward Health Care System (B2), located in Boston, Massachusetts, is a community-based accountable care organization and community
hospital network with 3,000 physicians, 10 hospital campuses, 24 affiliated urgent care providers, home care, hospice and other services. The
system serves more than one million patients annually in over 150 communities in the greater Boston area. Other Steward Health Care entities
include Steward Medical Group, Steward Health Care Network, and Steward Home Care.
Tenet Healthcare System (B2), located in Dallas, Texas, is a leading health care services company. Through its network, Tenet operates 80
hospitals, over 470 outpatient centers and has over 130,000 employees. Across the network, compassionate, quality care is provided to millions
of patients through a wide range of services. Tenet is affiliated with Conifer Health Solutions, which helps hospitals, employers and health
insurance companies improve the efficiency and performance of their operations and the health of the people they serve.
Portfolio Information
Health System Relationship Highlights
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 18
As of
2Q17 4Q16
ASSETS
Real estate investments:
Land $ 461,340 $ 386,526
Building and improvements 5,699,968 3,466,516
Lease intangibles 635,330 467,571
Construction in progress 251 —
6,796,889 4,320,613
Accumulated depreciation and amortization (907,728) (817,593)
Real estate investments, net 5,889,161 3,503,020
Investment in unconsolidated joint venture 68,901 —
Cash and cash equivalents 91,444 11,231
Restricted cash and escrow deposits 33,176 13,814
Receivables and other assets, net 175,340 173,461
Other intangibles, net 108,736 46,318
Total assets $ 6,366,758 $ 3,747,844
LIABILITIES AND EQUITY
Liabilities:
Debt $ 2,784,162 $ 1,768,905
Accounts payable and accrued liabilities 135,214 105,034
Derivative financial instruments - interest rate swaps 1,569 1,920
Security deposits, prepaid rent and other liabilities 55,286 49,859
Intangible liabilities, net 78,779 37,056
Total liabilities 3,055,010 1,962,774
Commitments and contingencies
Redeemable noncontrolling interests 4,663 4,653
Equity:
Preferred stock, $0.01 par value; 200,000,000 shares authorized; none issued and
outstanding — —
Class A common stock, $0.01 par value; 1,000,000,000 shares authorized; 200,646,523 and
141,719,134 shares issued and outstanding as of June 30, 2017 and December 31, 2016,
respectively 2,006 1,417
Additional paid-in capital 4,384,483 2,754,818
Accumulated other comprehensive loss (816) —
Cumulative dividends in excess of earnings (1,164,607) (1,068,961)
Total stockholders’ equity 3,221,066 1,687,274
Noncontrolling interests 86,019 93,143
Total equity 3,307,085 1,780,417
Total liabilities and equity $ 6,366,758 $ 3,747,844
Financial Statements
Condensed Consolidated Balance Sheets
(unaudited and in thousands, except share data)
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 19
Three Months Ended Six Months Ended
2Q17 2Q16 2Q17 2Q16
Revenues:
Rental income $ 139,525 $ 113,144 $ 263,518 $ 220,394
Interest and other operating income 354 90 708 155
Total revenues 139,879 113,234 264,226 220,549
Expenses:
Rental 43,523 35,061 82,543 68,414
General and administrative 8,472 6,813 16,895 13,586
Transaction 5,073 2,062 5,357 3,875
Depreciation and amortization 55,353 44,738 102,409 82,566
Impairment 5,093 — 5,093 —
Total expenses 117,514 88,674 212,297 168,441
Income before other income (expense) 22,365 24,560 51,929 52,108
Interest expense:
Interest related to derivative financial instruments (239) (659) (563) (1,304)
Gain (loss) on change in fair value of derivative financial instruments,
net 45 (658) 884 (3,450)
Total interest related to derivative financial instruments, including net
change in fair value of derivative financial instruments (194) (1,317) 321 (4,754)
Interest related to debt (17,706) (13,989) (33,764) (28,117)
Gain on sale of real estate, net — 4,212 3 4,212
Loss on extinguishment of debt, net (10,386) (22) (10,418) (22)
Income from unconsolidated joint venture 63 — 63 —
Other income 6 72 14 125
Net (loss) income $ (5,852) $ 13,516 $ 8,148 $ 23,552
Net income attributable to noncontrolling interests (66) (442) (521) (618)
Net (loss) income attributable to common stockholders $ (5,918) $ 13,074 $ 7,627 $ 22,934
Earnings per common share - basic:
Net (loss) income attributable to common stockholders $ (0.03) $ 0.10 $ 0.05 $ 0.17
Earnings per common share - diluted:
Net (loss) income attributable to common stockholders $ (0.03) $ 0.09 $ 0.05 $ 0.17
Weighted average common shares outstanding:
Basic 176,464 136,528 159,218 132,932
Diluted 176,464 140,512 163,490 135,876
Dividends declared per common share $ 0.300 $ 0.295 $ 0.600 $ 0.590
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 20
Financial Statements
Condensed Consolidated Statements of Operations
(unaudited and in thousands, except per share data)
Six Months Ended
2Q17 2Q16
Cash flows from operating activities:
Net income $ 8,148 $ 23,552
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and other 100,536 81,362
Share-based compensation expense 3,839 3,033
Bad debt expense 227 386
Impairment 5,093 —
Income from unconsolidated joint venture (63) —
Gain on sale of real estate, net (3) (4,212)
Loss on extinguishment of debt, net 10,418 22
Change in fair value of derivative financial instruments (884) 3,450
Changes in operating assets and liabilities:
Receivables and other assets, net (2,969) (667)
Accounts payable and accrued liabilities 14,272 (5,983)
Security deposits, prepaid rent and other liabilities 1,907 (4,543)
Net cash provided by operating activities 140,521 96,400
Cash flows from investing activities:
Investments in real estate (2,202,815) (336,760)
Investment in unconsolidated joint venture (68,839) —
Development of real estate (348) —
Proceeds from the sale of real estate 4,746 23,368
Capital expenditures (26,022) (21,826)
Restricted cash, escrow deposits and other assets (19,362) (426)
Net cash used in investing activities (2,312,640) (335,644)
Cash flows from financing activities:
Borrowings on unsecured revolving credit facility 305,000 336,000
Payments on unsecured revolving credit facility (393,000) (293,000)
Proceeds from unsecured senior notes 900,000 —
Payments on secured mortgage loans (74,319) (22,791)
Deferred financing costs (9,400) —
Debt extinguishment costs (10,391) —
Security deposits 1,964 765
Proceeds from issuance of common stock 1,624,222 292,984
Repurchase and cancellation of common stock (3,339) (2,287)
Dividends paid (85,683) (76,018)
Distributions paid to noncontrolling interest of limited partners (2,722) (1,331)
Net cash provided by financing activities 2,252,332 234,322
Net change in cash and cash equivalents 80,213 (4,922)
Cash and cash equivalents - beginning of period 11,231 13,070
Cash and cash equivalents - end of period $ 91,444 $ 8,148
Financial Statements
Condensed Consolidated Statements of Cash Flows
(unaudited and in thousands)
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 21
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 22
Reporting Definitions
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”): Is presented on an assumed annualized basis.
We define Adjusted EBITDA for HTA as net income computed in accordance with GAAP plus: (i) depreciation and amortization; (ii) interest
expense and net change in the fair value of derivative financial instruments; (iii) proportionate share of joint venture depreciation, amortization
and other adjustments; (iv) transaction expenses; (v) impairment; (vi) gain or loss on the sales of real estate; (vii) gain or loss on extinguishment
of debt; (viii) non-cash compensation expense; (ix) pro forma impact of our acquisitions/dispositions; and (x) other normalizing items. We
consider Adjusted EBITDA an important measure because it provides additional information to allow management, investors, and our current
and potential creditors to evaluate and compare our core operating results and our ability to service debt.
Annualized Base Rent: Annualized base rent is calculated by multiplying contractual base rent for the end of the period by 12 (excluding the
impact of abatements, concessions, and straight-line rent).
Cash Net Operating Income (“Cash NOI”): Cash NOI is a non-GAAP financial measure which excludes from NOI: (i) straight-line rent adjustments
and (ii) amortization of below and above market leases/leasehold interests. Contractual base rent, contractual rent increases, contractual rent
concessions and changes in occupancy or lease rates upon commencement and expiration of leases are a primary driver of HTA’s revenue
performance. HTA believes that Cash NOI, which removes the impact of straight-line rent adjustments, provides another measurement of the
operating performance of its operating assets. Additionally, HTA believes that Cash NOI is a widely accepted measure of comparative operating
performance of real estate investment trusts (“REITs”). However, HTA’s use of the term Cash NOI may not be comparable to that of other REITs
as they may have different methodologies for computing this amount. Cash NOI should not be considered as an alternative to net income or
loss (computed in accordance with GAAP) as an indicator of our financial performance. Cash NOI should be reviewed in connection with other
GAAP measurements.
Credit Ratings: Credit ratings of our tenants or their parent companies.
Customary Health System Restrictions: Ground leases with a health system lessor that include restrictions on tenants that may be considered
competitive with the hospital, which may include provisions that tenants must have hospital privileges.
Economic with Limited Restrictions: Ground leases that are primarily economic in nature and contain no material restrictions on tenancy.
Funds from Operations (“FFO”): HTA computes FFO in accordance with the current standards established by NAREIT. NAREIT defines FFO
as net income or loss attributable to common stockholders (computed in accordance with GAAP), excluding gains or losses from sales of real
estate property and impairment write-downs of depreciable assets, plus depreciation and amortization related to investments in real estate, and
after adjustments for unconsolidated partnerships and joint ventures. HTA presents this non-GAAP financial measure because it considers it
an important supplemental measure of its operating performance and believes it is frequently used by securities analysts, investors and other
interested parties in the evaluation of REITs. Historical cost accounting assumes that the value of real estate assets diminishes ratably over
time. Since real estate values have historically risen or fallen based on market conditions, many industry investors have considered the
presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. Because FFO
excludes depreciation and amortization unique to real estate, among other items, it provides a perspective not immediately apparent from net
income or loss attributable to common stockholders.
Gross Leasable Area (“GLA”): Gross leasable area (in square feet).
Investments in Real Estate: Based on acquisition price.
Leased Rate: Leased rate represents the percentage of total GLA that is leased, including month-to-month leases and leases which have been
executed, but which have not yet commenced, as of the date reported.
Metropolitan Statistical Area (“MSA”): Is a geographical region with a relatively high population density at its core and close economic ties
throughout the area. MSAs are defined by the Office of Management and Budget.
Net Operating Income (“NOI”): NOI is a non-GAAP financial measure that is defined as net income or loss (computed in accordance with GAAP)
before: (i) general and administrative expenses; (ii) transaction expenses; (iii) depreciation and amortization expense; (iv) impairment; (v) interest
expense and net change in fair value of derivative financial instruments; (vi) gain or loss on sales of real estate; (vii) gain or loss on extinguishment
of debt; and (viii) other income or expense. HTA believes that NOI provides an accurate measure of the operating performance of its operating
assets because NOI excludes certain items that are not associated with the management of its properties. Additionally, HTA believes that NOI
is a widely accepted measure of comparative operating performance of REITs. However, HTA’s use of the term NOI may not be comparable to
that of other REITs as they may have different methodologies for computing this amount. NOI should not be considered as an alternative to net
income or loss (computed in accordance with GAAP) as an indicator of our financial performance. NOI should be reviewed in connection with
other GAAP measurements.
Normalized Funds Available for Distribution (“Normalized FAD”): HTA computes Normalized FAD, which excludes from Normalized FFO: (i)
other income or expense; (ii) non-cash compensation expense; (iii) straight-line rent adjustments; (iv) amortization of below and above market
leases/leasehold interests and corporate assets; (v) amortization of deferred financing costs and debt premium/discount; and (vi) recurring
capital expenditures, tenant improvements and leasing commissions. HTA believes this non-GAAP financial measure provides a meaningful
supplemental measure of our operating performance. Normalized FAD should not be considered as an alternative to net income or loss attributable
to common stockholders (computed in accordance with GAAP) as an indicator of our financial performance, nor is it indicative of cash available
to fund cash needs. Normalized FAD should be reviewed in connection with other GAAP measurements.
2Q 2017 I Supplemental Information
Healthcare Trust of America, Inc. I 23
Reporting Definitions - Continued
Normalized Funds From Operations (“Normalized FFO”): HTA computes Normalized FFO, which excludes from FFO: (i) transaction expenses;
(ii) gain or loss on change in fair value of derivative financial instruments; (iii) gain or loss on extinguishment of debt; (iv) noncontrolling income
or loss from partnership units included in diluted shares; and (v) other normalizing items, which include items that are unusual and infrequent
in nature. HTA presents this non-GAAP financial measure because it allows for the comparison of our operating performance to other REITs
and between periods on a consistent basis. HTA’s methodology for calculating Normalized FFO may be different from the methods utilized by
other REITs and, accordingly, may not be comparable to other REITs. Normalized FFO should not be considered as an alternative to net income
or loss attributable to common stockholders (computed in accordance with GAAP) as an indicator of our financial performance, nor is it indicative
of cash available to fund cash needs. Normalized FFO should be reviewed in connection with other GAAP measurements.
Occupancy Health System Restrictions: Ground leases with customary health system restrictions whereby the restrictions cease if occupancy
in the buildings/on-campus fall below stabilized occupancy, which is generally between 85% and 90%.
Off-Campus/Non-Aligned: A building or portfolio that is not located on or adjacent to a healthcare or hospital campus or does not have a majority
alignment with a recognized healthcare system.
On-Campus/Aligned: On-campus refers to a property that is located on or adjacent to a healthcare or hospital campus. Aligned refers to a
property that is not on a healthcare or hospital campus, but anchored by a healthcare system.
Recurring Capital Expenditures, Tenant Improvements and Leasing Commissions: Represents amounts paid for: (i) recurring capital expenditures
required to maintain and re-tenant our properties; (ii) second generation tenant improvements; and (iii) leasing commissions paid to secure new
tenants. Excludes capital expenditures and tenant improvements for recent acquisitions that were contemplated in the purchase price or closing
agreements.
Retention: Represents the sum of the total leased GLA of tenants that renewed a lease during the period over the total GLA of leases that
renewed or expired during the period.
Same-Property Cash Net Operating Income (“Same-Property Cash NOI”): To facilitate the comparison of Cash NOI between periods, HTA
calculates comparable amounts for a subset of its owned properties referred to as “Same-Property”. Same-Property Cash NOI excludes
properties which have not been owned and operated by HTA during the entire span of all periods presented, excluding properties intended for
disposition in the near term, notes receivable interest income and certain non-routine items. Same-Property Cash NOI should not be considered
as an alternative to net income or loss (computed in accordance with GAAP) as an indicator of our financial performance. Same-Property Cash
NOI should be reviewed in connection with other GAAP measurements.
