American Homes 4 Rent - FORM 8-K/A - EX-99.3 - EXHIBIT 99.3

Attached files

file	filename
EX-99.1 - EXHIBIT 99.1 - American Homes 4 Rent	a991-nov2017consolidatingo.htm
8-K/A - 8-K/A - American Homes 4 Rent	a8kdoc-nov2017consolidatin.htm
EX-99.2 - EXHIBIT 99.2 - American Homes 4 Rent	a992-nov2017consolidatingo.htm
EX-23.2 - EXHIBIT 23.2 - American Homes 4 Rent	a232-bdoconsentfornov20178.htm
EX-23.1 - EXHIBIT 23.1 - American Homes 4 Rent	a231-eyconsentfornov20178ka.htm

Exhibit 99.3



CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (UNAUDITED)

		American Homes 4 Rent, L.P. and Subsidiaries
		As of September 30, 2017, and December 31, 2016, and for the
		Nine Months Ended September 30, 2017 and 2016

AMERICAN HOMES 4 RENT, L.P. AND SUBSIDIARIES

INDEX TO CONDENSED CONSOLIDATING FINANCIAL STATEMENTS



		Page

Condensed Consolidating Financial Statements (Unaudited):		1

Condensed Consolidating Balance Sheets as of September 30, 2017 (Unaudited) and December 31, 2016		2

Condensed Consolidating Statements of Operations for the Nine Months Ended September 30, 2017 and 2016 (Unaudited)		4

Condensed Consolidating Statements of Comprehensive Income (Loss) for the Nine Months Ended September 30, 2017 and 2016 (Unaudited)		6

Condensed Consolidating Statements of Cash Flows for the Nine Months Ended September 30, 2017 and 2016 (Unaudited)		7

Condensed Consolidating Financial Statements (Unaudited)

American Homes 4 Rent is the general partner of American Homes 4 Rent, L.P., which collectively with its consolidated subsidiaries is referred to as the Operating Partnership. Pursuant to Rule 3-10 of Regulation S-X, the following condensed consolidating financial information is provided for the Operating Partnership, including American Homes 4 Rent, L.P. (the “Parent Company”), American Residential Properties OP, L.P (the “Guarantor Subsidiary”), which is a 100% owned subsidiary of the Parent Company, and the Combined Non-Guarantor Subsidiaries. This summarized financial information may not necessarily be indicative of the results of operations or financial position had the Parent Company, the Guarantor Subsidiary or the Combined Non-Guarantor Subsidiaries operated as independent entities. In addition, the Operating Partnership acquired the Guarantor Subsidiary on February 29, 2016. Accordingly, the information presented for the Guarantor Subsidiary does not reflect a full period of operating results for 2016. All intercompany balances and transactions between the Parent Company, the Guarantor Subsidiary and the Non-Guarantor Subsidiaries have been eliminated as shown in the “Consolidating Adjustments” column. All assets and liabilities have been allocated to the Parent Company, the Guarantor Subsidiary and the Combined Non-Guarantor Subsidiaries based on legal entity ownership.

American Homes 4 Rent, L.P. and Subsidiaries

Condensed Consolidating Balance Sheets

(Amounts in thousands)



	As of September 30, 2017
	American Homes 4 Rent, L.P. (Parent Company)		American Residential Properties OP, L.P. (Guarantor Subsidiary)			Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
	(Unaudited)		(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Assets
Single-family properties, net	$	—	$	3,113		$	7,799,386		$	—		$	7,802,499
Cash and cash equivalents	196,632		—			46,915			—			243,547
Restricted cash	—		39			119,535			—			119,574
Rent and other receivables, net	15		519			34,895			—			35,429
Intercompany receivables	142,269		—			—			(142,269		)	—
Escrow deposits, prepaid expenses and other assets, including due from affiliates	59,063		167			115,802			—			175,032
Investments in subsidiaries	5,572,743		113,932			—			(5,686,675		)	—
Deferred costs and other intangibles, net	10,387		—			3,129			—			13,516
Goodwill	120,279		—			—			—			120,279
Total assets	$	6,101,388	$	117,770		$	8,119,662		$	(5,828,944	)	$	8,509,876

Liabilities
Revolving credit facility	$	—	$	—		$	—		$	—		$	—
Term loan facility, net	197,913		—			—			—			197,913
Asset-backed securitizations, net	—		—			1,981,444			—			1,981,444
Exchangeable senior notes, net	—		110,771			—			—			110,771
Secured note payable	—		—			49,107			—			49,107
Accounts payable and accrued expenses	2,067		3,816			257,862			—			263,745
Intercompany payables	—		7,921			134,348			(142,269		)	—
Participating preferred units derivative liability	68,469		—			—			—			68,469
Total liabilities	268,449		122,508			2,422,761			(142,269		)	2,671,449

Capital
Partners' capital:
General partner:
Common units	4,001,125		(4,738		)	5,698,383			(5,686,675		)	4,008,095
Preferred units	1,095,494		—			—			—			1,095,494
Limited partner:
Common units	736,320		—			—			—			736,320
Total partners' capital:	5,832,939		(4,738		)	5,698,383			(5,686,675		)	5,839,909

Noncontrolling interest	—		—			(1,482		)	—			(1,482		)
Total capital	5,832,939		(4,738		)	5,696,901			(5,686,675		)	5,838,427

Total liabilities and capital	$	6,101,388	$	117,770		$	8,119,662		$	(5,828,944	)	$	8,509,876

American Homes 4 Rent, L.P. and Subsidiaries

Condensed Consolidating Balance Sheets (continued)

(Amounts in thousands)



	As of December 31, 2016
	American Homes 4 Rent, L.P. (Parent Company)		American Residential Properties OP, L.P. (Guarantor Subsidiary)		Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Assets
Single-family properties, net	$	—	$	4,838	$	7,543,018		$	—		$	7,547,856
Cash and cash equivalents	76,913		—		41,886			—			118,799
Restricted cash	—		62		131,380			—			131,442
Rent and other receivables, net	131		144		17,343			—			17,618
Intercompany receivables	133,808		—		—			(133,808		)	—
Escrow deposits, prepaid expenses and other assets, including due from affiliates	57,543		170		101,547			—			159,260
Investments in subsidiaries	4,928,974		116,242		—			(5,045,216		)	—
Deferred costs and other intangibles, net	7,724		3		4,229			—			11,956
Goodwill	120,279		—		—			—			120,279
Total assets	$	5,325,372	$	121,459	$	7,839,403		$	(5,179,024	)	$	8,107,210

Liabilities
Revolving credit facility	$	—	$	—	$	—		$	—		$	—
Term loan facility, net	321,735		—		—			—			321,735
Asset-backed securitizations, net	—		—		2,442,863			—			2,442,863
Exchangeable senior notes, net	—		108,148		—			—			108,148
Secured note payable	—		—		49,828			—			49,828
Accounts payable and accrued expenses	1,715		3,708		171,783			—			177,206
Intercompany payables	—		8,393		125,415			(133,808		)	—
Participating preferred units derivative liability	69,810		—		—			—			69,810
Total liabilities	393,260		120,249		2,789,889			(133,808		)	3,169,590

Capital
Partners' capital:
General partner:
Common units	3,351,022		1,210		5,050,976			(5,045,216		)	3,357,992
Preferred units	834,849		—		—			—			834,849
Limited partner:
Common units	746,174		—		—			—			746,174
Accumulated other comprehensive income	67		—		28			—			95
Total partners' capital:	4,932,112		1,210		5,051,004			(5,045,216		)	4,939,110

Noncontrolling interest	—		—		(1,490		)	—			(1,490		)
Total capital	4,932,112		1,210		5,049,514			(5,045,216		)	4,937,620

Total liabilities and capital	$	5,325,372	$	121,459	$	7,839,403		$	(5,179,024	)	$	8,107,210

American Homes 4 Rent, L.P. and Subsidiaries

Condensed Consolidating Statements of Operations

(Amounts in thousands)

(Unaudited)



	For the Nine Months Ended September 30, 2017
	American Homes 4 Rent, L.P. (Parent Company)			American Residential Properties OP, L.P. (Guarantor Subsidiary)			Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Revenues:
Rents from single-family properties	$	—		$	214		$	613,031		$	—		$	613,245
Fees from single-family properties	—			2			8,135			—			8,137
Tenant charge-backs	—			17			91,832			—			91,849
Other	1,029			—			3,338			—			4,367
Total revenues	1,029			233			716,336			—			717,598

Expenses:
Property operating expenses	—			129			267,074			—			267,203
Property management expenses	—			14			52,353			—			52,367
General and administrative expense	15,184			2			11,560			—			26,746
Interest expense	9,005			5,427			72,441			—			86,873
Acquisition fees and costs expensed	358			—			3,456			—			3,814
Depreciation and amortization	1,147			8			220,304			—			221,459
Hurricane-related charges, net	—			—			10,136			—			10,136
Other	290			111			3,801			—			4,202
Total expenses	25,984			5,691			641,125			—			672,800

Intercompany income	190			—			413			(603		)	—
Intercompany expenses	(413		)	—			(190		)	603			—
Gain (loss) on sale of single-family properties and other, net	3,031			(490		)	3,834			—			6,375
Loss on early extinguishment of debt	—			—			(6,555		)	—			(6,555		)
Remeasurement of participating preferred units	1,341			—			—			—			1,341
Equity in income of subsidiaries	66,757			27,143			—			(93,900		)	—

Net income (loss)	45,951			21,195			72,713			(93,900		)	45,959

Noncontrolling interest	—			—			8			—			8
Preferred distributions	46,122			—			—			—			46,122

Net (loss) income attributable to common unitholders	$	(171	)	$	21,195		$	72,705		$	(93,900	)	$	(171	)

American Homes 4 Rent, L.P. and Subsidiaries

Condensed Consolidating Statements of Operations (continued)

(Amounts in thousands, except unit and per unit data)

(Unaudited)



	For the Nine Months Ended September 30, 2016
	American Homes 4 Rent, L.P. (Parent Company)			American Residential Properties OP, L.P. (Guarantor Subsidiary)			Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Revenues:
Rents from single-family properties	$	—		$	314		$	558,309		$	—		$	558,623
Fees from single-family properties	—			3			7,816			—			7,819
Tenant charge-backs	—			11			72,066			—			72,077
Other	239			—			12,572			—			12,811
Total revenues	239			328			650,763			—			651,330

Expenses:
Property operating expenses	—			122			238,865			—			238,987
Property management expenses	—			19			53,158			—			53,177
General and administrative expense	14,888			24			9,632			—			24,544
Interest expense	8,184			4,136			86,989			—			99,309
Acquisition fees and costs expensed	6,283			—			4,616			—			10,899
Depreciation and amortization	851			98			223,564			—			224,513
Other	37			60			6,385			—			6,482
Total expenses	30,243			4,459			623,209			—			657,911

Intercompany income	336			—			—			(336		)	—
Intercompany expenses	—			—			(336		)	336			—
Gain on sale of single-family properties and other, net	—			—			12,574			—			12,574
Loss on early extinguishment of debt	(2,724		)	—			(10,684		)	—			(13,408		)
Gain on conversion of Series E units	11,463			—			—			—			11,463
Remeasurement of participating preferred units	(2,940		)	—			—			—			(2,940		)
Equity in income (loss) of subsidiaries	25,423			(6,079		)	—			(19,344		)	—

Net income (loss)	1,554			(10,210		)	29,108			(19,344		)	1,108

Noncontrolling interest	—			—			(446		)	—			(446		)
Preferred distributions	26,650			—			—			—			26,650
Income allocated to Series C and D limited partners	16,478			—			—			—			16,478

Net (loss) income attributable to common unitholders	$	(41,574	)	$	(10,210	)	$	29,554		$	(19,344	)	$	(41,574	)

American Homes 4 Rent, L.P. and Subsidiaries

Condensed Consolidating Statements of Comprehensive Income (Loss)

(Amounts in thousands)

(Unaudited)



	For the Nine Months Ended September 30, 2017
	American Homes 4 Rent, L.P. (Parent Company)			American Residential Properties OP, L.P. (Guarantor Subsidiary)		Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net income (loss)	$	45,951		$	21,195	$	72,713		$	(93,900	)	$	45,959
Other comprehensive loss:
Unrealized gain on interest rate cap agreement:
Reclassification adjustment for amortization of interest expense included in net income (loss)	—			—		(28		)	—			(28		)
Unrealized gain on investment in equity securities:
Reclassification adjustment for realized gain included in net income (loss)	(67		)	—		—			—			(67		)
Other comprehensive loss	(67		)	—		(28		)	—			(95		)
Comprehensive income (loss)	45,884			21,195		72,685			(93,900		)	45,864
Comprehensive income attributable to noncontrolling interests	—			—		8			—			8
Preferred distributions	46,122			—		—			—			46,122
Comprehensive (loss) income attributable to common unitholders	$	(238	)	$	21,195	$	72,677		$	(93,900	)	$	(266	)



	For the Nine Months Ended September 30, 2016
	American Homes 4 Rent, L.P. (Parent Company)			American Residential Properties OP, L.P. (Guarantor Subsidiary)			Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Net income (loss)	$	1,554		$	(10,210	)	$	29,108		$	(19,344	)	$	1,108
Other comprehensive income:
Unrealized gain on interest rate cap agreement:
Reclassification adjustment for amortization of interest expense included in net income (loss)	—			—			130			—			130
Other comprehensive income	—			—			130			—			130
Comprehensive income (loss)	1,554			(10,210		)	29,238			(19,344		)	1,238
Comprehensive loss attributable to noncontrolling interests	—			—			(446		)	—			(446		)
Preferred distributions	26,650			—			—			—			26,650
Income allocated to Series C and D limited partners	16,478			—			—			—			16,478
Comprehensive (loss) income attributable to common unitholders	$	(41,574	)	$	(10,210	)	$	29,684		$	(19,344	)	$	(41,444	)

American Homes 4 Rent, L.P. and Subsidiaries

Condensed Consolidating Statements of Cash Flows

(Amounts in thousands)

(Unaudited)



	For the Nine Months Ended September 30, 2017
	American Homes 4 Rent, L.P. (Parent Company)			American Residential Properties OP, L.P. (Guarantor Subsidiary)			Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Operating activities
Net cash (used for) provided by operating activities	$	(45,914	)	$	(3,563	)	$	398,852		$	—		$	349,375

Investing activities
Cash paid for single-family properties	—			—			(462,875		)	—			(462,875		)
Change in escrow deposits for purchase of single-family properties	—			—			(2,710		)	—			(2,710		)
Net proceeds received from sales of single-family properties and other	14,265			2,821			51,532			—			68,618
Collections from mortgage financing receivables	—			—			83			—			83
Distributions from unconsolidated joint ventures	680			—			5,301			—			5,981
Collections from intercompany notes	9,507			—			—			(9,507		)	—
Investments in subsidiaries	(575,754		)	29,453			—			546,301			—
Renovations to single-family properties	—			(1,591		)	(29,617		)	—			(31,208		)
Other capital expenditures for single-family properties	—			—			(26,725		)	—			(26,725		)
Other purchases of productive assets	(6,657		)	—			(31,403		)	—			(38,060		)
Net cash (used for) provided by investing activities	(557,959		)	30,683			(496,414		)	536,794			(486,896		)

Financing activities
Proceeds from issuance of Class A common units	694,765			—			—			—			694,765
Payments of Class A common unit issuance costs	(10,444		)	—			—			—			(10,444		)
Proceeds from issuance of perpetual preferred units	270,000			—			—			—			270,000
Payments of perpetual preferred unit issuance costs	(9,229		)	—			—			—			(9,229		)
Proceeds from exercise of stock options	988			—			—			—			988
Redemptions of Class A units	(169		)	—			—			—			(169		)
Payments on asset-backed securitizations	—			—			(472,470		)	—			(472,470		)
Proceeds from revolving credit facility	62,000			—			—			—			62,000
Payments on revolving credit facility	(112,000		)	—			—			—			(112,000		)
Proceeds from term loan facility	25,000			—			—			—			25,000
Payments on term loan facility	(100,000		)	—			—			—			(100,000		)
Payments on secured note payable	—			—			(721		)	—			(721		)
Payments on intercompany notes borrowed	—			—			(9,507		)	9,507			—
Intercompany financing and distributions to parent	—			(27,143		)	573,444			(546,301		)	—
Distributions to common unitholders	(47,223		)	—			—			—			(47,223		)
Distributions to preferred unitholders	(46,122		)	—			—			—			(46,122		)
Deferred financing costs paid	(3,974		)	—			—			—			(3,974		)
Net cash provided by (used for) financing activities	723,592			(27,143		)	90,746			(536,794		)	250,401

Net increase (decrease) in cash, cash equivalents and restricted cash	119,719			(23		)	(6,816		)	—			112,880
Cash, cash equivalents and restricted cash, beginning of period	76,913			62			173,266			—			250,241
Cash, cash equivalents and restricted cash, end of period	$	196,632		$	39		$	166,450		$	—		$	363,121

Supplemental cash flow information
Cash payments for interest, net of amounts capitalized	$	(7,235	)	$	(2,803	)	$	(67,926	)	$	—		$	(77,964	)

Supplemental schedule of noncash investing and financing activities
Accounts payable and accrued expenses related to property acquisitions and renovations	$	—		$	12		$	7,139		$	—		$	7,151
Transfer of term loan borrowings to revolving credit facility	$	50,000		$	—		$	—		$	—		$	50,000
Transfer of deferred financing costs from term loan to revolving credit facility	$	1,524		$	—		$	—		$	—		$	1,524
Transfers of completed homebuilding deliveries to properties	$	—		$	—		$	3,010		$	—		$	3,010
Note receivable related to a bulk sale of properties, net of discount	$	5,635		$	—		$	—		$	—		$	5,635

American Homes 4 Rent, L.P. and Subsidiaries

Condensed Consolidating Statements of Cash Flows (continued)

(Amounts in thousands)

(Unaudited)



	For the Nine Months Ended September 30, 2016
	American Homes 4 Rent, L.P. (Parent Company)			American Residential Properties OP, L.P. (Guarantor Subsidiary)			Combined Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated Total
Operating activities
Net cash (used for) provided by operating activities	$	(161,897	)	$	6,925		$	409,952		$	—		$	254,980

Investing activities
Cash paid for single-family properties	—			—			(187,886		)	—			(187,886		)
Change in escrow deposits for purchase of single-family properties	—			—			(821		)	—			(821		)
Cash acquired in ARPI merger	—			3,317			21,703			—			25,020
Payoff of credit facility in connection with ARPI merger	(350,000		)	—			—			—			(350,000		)
Net proceeds received from sales of single-family properties and other	—			—			71,894			—			71,894
Net proceeds received from sales of non-performing loans	—			—			44,538			—			44,538
Purchase of commercial office buildings	(20,056		)	—			(7,049		)	—			(27,105		)
Collections from mortgage financing receivables	—			—			17,687			—			17,687
Distributions from unconsolidated joint ventures	6,400			—			—			—			6,400
Collections from intercompany notes	19,092			—			—			(19,092		)	—
Investments in subsidiaries	(71,398		)	(15,242		)	—			86,640			—
Renovations to single-family properties	—			(28		)	(21,682		)	—			(21,710		)
Other capital expenditures for single-family properties	—			—			(22,026		)	—			(22,026		)
Net cash (used for) provided by investing activities	(415,962		)	(11,953		)	(83,642		)	67,548			(444,009		)

Financing activities
Proceeds from issuance of perpetual preferred units	498,750			—			—			—			498,750
Payments of perpetual preferred unit issuance costs	(15,922		)	—			—			—			(15,922		)
Proceeds from exercise of stock options	2,777			—			—			—			2,777
Repurchase of Class A common units	(96,098		)	—			—			—			(96,098		)
Redemptions of Class A units	(399		)	—			—			—			(399		)
Payments on asset-backed securitizations	—			—			(374,031		)	—			(374,031		)
Proceeds from revolving credit facilities	951,000			—			—			—			951,000
Payments on revolving credit facilities	(876,000		)	—			—			—			(876,000		)
Proceeds from term loan facility	250,000			—			—			—			250,000
Payments on secured note payable	—			—			(687		)	—			(687		)
Payments on intercompany notes borrowed	—			—			(19,092		)	19,092			—
Intercompany financing and distributions to parent	—			6,079			80,561			(86,640		)	—
Distributions to noncontrolling interests	—			—			(230		)	—			(230		)
Distributions to common unitholders	(43,493		)	—			—			—			(43,493		)
Distributions to preferred unitholders	(26,650		)	—			—			—			(26,650		)
Distributions to Series D convertible unitholders	(856		)	—			—			—			(856		)
Deferred financing costs paid	(10,385		)	—			(40		)	—			(10,425		)
Net cash provided by (used for) financing activities	632,724			6,079			(313,519		)	(67,548		)	257,736

Net increase in cash, cash equivalents and restricted cash	54,865			1,051			12,791			—			68,707
Cash, cash equivalents and restricted cash, beginning of period	11,268			—			157,700			—			168,968
Cash, cash equivalents and restricted cash, end of period	$	66,133		$	1,051		$	170,491		$	—		$	237,675

Supplemental cash flow information
Cash payments for interest, net of amounts capitalized	$	(6,244	)	$	(2,180	)	$	(79,283	)	$	—		$	(87,707	)

Supplemental schedule of noncash investing and financing activities
Accounts payable and accrued expenses related to property acquisitions and renovations	$	—		$	11		$	(237	)	$	—		$	(226	)

Merger with ARPI
Single-family properties	$	—		$	5,898		$	1,271,355		$	—		$	1,277,253
Rent and other receivables, net	$	—		$	50		$	793		$	—		$	843
Escrow deposits, prepaid expenses and other assets	$	—		$	666		$	34,468		$	—		$	35,134
Deferred costs and other intangibles, net	$	—		$	109		$	22,587		$	—		$	22,696
Asset-backed securitization	$	—		$	—		$	(329,703	)	$	—		$	(329,703	)
Exchangeable senior notes, net	$	—		$	(112,298	)	$	—		$	—		$	(112,298	)
Accounts payable and accrued expenses	$	(8,660	)	$	(4,475	)	$	(25,350	)	$	—		$	(38,485	)
Class A common units issued	$	(530,460	)	$	—		$	—		$	—		$	(530,460	)

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