Bluerock Residential Growth REIT, Inc. - FORM 8-K - EX-99.2 - EXHIBIT 99.2

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EX-99.1 - EXHIBIT 99.1 - Bluerock Residential Growth REIT, Inc.	tm2026983d1_ex99-1.htm
8-K - FORM 8-K - Bluerock Residential Growth REIT, Inc.	tm2026983d1_8k.htm

Exhibit 99.2

Bluerock Residential Growth REIT, Inc.

Second Quarter 2020

Supplemental Financial Information

(Unaudited)

Table of Contents

Second Quarter Earnings Release	3
Financial and Operating Highlights	17
Share and Unit Information	18
EBITDAre and Interest Information	19
Financial Statistics	20
Recent Acquisitions and Investments	21
Recent Dispositions	22
Investments in Unconsolidated Real Estate Joint Ventures, Notes and Accrued Interest Receivable from Related Parties, and Ground Lease	23
Portfolio Information	24
Renovation Table	25
Lease-up and Development Mezzanine/Preferred/Ground Lease Investments	26
Condensed Consolidated Balance Sheets	27
Consolidated Statements of Operations	28
Reconciliation of Funds from Operations (FFO) and Core Funds from Operations (CFFO)	29
Mortgages Payable Summary Information	30
Definitions of Non-GAAP Financial Measures	32

This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are based upon the Company’s present expectations, but these statements are not guaranteed to occur. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward-looking statements. Although the Company believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions, the Company’s actual results and performance could differ materially from those set forth in these forward-looking statements due to numerous factors. Currently, one of the most significant factors is the potential adverse effect of the COVID-19 pandemic on the financial condition, results of operations, cash flows and performance of the Company and its tenants, partners and employees, as well as the real estate market and the global economy and financial markets. The extent to which COVID-19 impacts the Company and its tenants, partners and employees will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact (including governmental actions that may vary by jurisdiction, such as mandated business closing; stay-at-home orders; limits on group activity; and actions to protect residential tenants from eviction), and the direct and indirect economic effects of the pandemic and containment measures, including national and local employment rates and the corresponding impact on the Company’s tenants’ ability to pay their rent on time or at all, among others. For further discussion of the factors that could affect outcomes, please refer to the risk factors set forth in Item 1A of the Company’s Annual Report on Form 10-K filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) on February 24, 2020, and subsequent filings by the Company with the SEC. We claim the safe harbor protection for forward looking statements contained in the Private Securities Litigation Reform Act of 1995.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

For Immediate Release

Bluerock Residential Growth REIT Announces Second Quarter 2020 Results

- Total Revenues Grew 1.1% YoY -

- Same Store Occupancy Increased 0.9% -

- Same Store Average Rent Increased 1.6% YoY -

- Collected 97% of Second Quarter Rents Including Payment Plans -

New York, NY (August 10, 2020) – Bluerock Residential Growth REIT, Inc. (NYSE American: BRG) (“the Company”), an owner of highly amenitized multifamily apartment communities, announced today its financial results for the quarter ended June 30, 2020.

“We are encouraged by increases in same store occupancy and average rent, along with an improvement in operating margins over the prior year period given the challenges of COVID-19. We appreciate the efforts of our dedicated team that strives to ensure that our properties maintain their high standard of service in spite of COVID-19,” said Ramin Kamfar, Company Chairman and CEO. “Our rental collections continue to reflect the quality and stability of our investments in highly amenitized, live/work/play apartment communities in knowledge-based job economies such as health care, technology, education, sciences and finance sectors, as we acknowledge there could be some challenges in the future due to the further impact of COVID-19. The proceeds from the property sales and Series T Preferred Stock raises, and our deliberate slowdown in investment activity, increased our cash position so that we can effectively navigate the current environment and be positioned for growth opportunities.”

Second Quarter Highlights

Total revenues grew 1.1% to $53.0 million for the quarter from $52.4 million in the prior year period.

Net income attributable to common stockholders for the second quarter of 2020 was $0.61 per share, as compared to net loss attributable to common stockholders of ($0.50) per share in the prior year period.

Property Net Operating Income (“NOI”) grew 5.5% to $29.1 million, from $27.6 million in the prior year period.

Same store occupancy increased 90 basis points and same store average rent increased 1.6%.

Improved operating margins by 170 basis points year over year to 61.1%.

Same store revenue and NOI decreased 0.4% and 1.1% respectively, as compared to the prior year period.

Portfolio occupancy was 95.3% at June 30, 2020, up 130 basis points from the prior year.

Collected 97% of rents, including payment plans of 1%, for the three months ended June 30, 2020, including the properties underlying its preferred and mezzanine loan investments.

Core funds from operations attributable to common shares and units (“CFFO”) was $5.1 million, compared to $6.7 million in the prior year period. CFFO per share was $0.15 for the second quarter as compared to $0.22 in the prior year period. CFFO was impacted by the company’s strategic decision to reduce its investment pace in the near term and to increase its cash position.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Consolidated real estate investments, at cost, were approximately $2.1 billion.

Completed preferred equity and mezzanine loan investments totaling $16 million, including in one multifamily community totaling 328 units in Jacksonville, Florida, additional funding for six multifamily developments and the buyout of the noncontrolling interest in one asset for $3.5 million.

In April 2020, closed on sales of three properties for $160 million which contracts were entered into pre-COVID-19.

Completed 39 value-add unit upgrades during the quarter achieving an average 23.3% ROI.

Paid quarterly dividend of $0.1625 in cash per share of common stock.

Raised $42.8 million through its continuous registered Series T Preferred Stock offering in the quarter.

As of June 30, 2020, the Company had $236.2 million of unrestricted cash and availability under its revolving credit facilities.

Expanded stock repurchase program to include repurchases of traded preferred stock.

Included later in this release are definitions of NOI, CFFO and other Non-GAAP financial measures and reconciliations of such measures to their most comparable financial measures as calculated and presented under GAAP.

COVID-19 Pandemic Update

Since the beginning of the COVID-19 pandemic, the Company executed on actions to prioritize the health and well-being of its tenants, business partners, service providers and employees, while striving to provide the highest quality living experience possible and facilitating virtual leasing and services.

The Company continues to monitor COVID-19’s impact on its business, properties, tenants, partners and employees and the full impact of the COVID-19 pandemic on rental revenues and overall financial performance remains uncertain.

Post-Quarter Operational Performance

•

As of July 31, 2020, the Company has collected 97% of July rents from its multifamily properties, including payment plans of 1%.

•

Occupancy remains strong at 95.4% as of July 31, 2020.

Current Liquidity

Due to the uncertainties presented by the COVID-19 pandemic, the Company took a number of measures to increase its liquidity and believes it has sufficient liquidity through this uncertain period.

•

The Company has approximately $205 million in unrestricted cash and availability under its revolving credit facilities as of July 31, 2020.

•

Over $29 million has been raised from the Company’s continuous registered Series T Preferred Stock offering since June 30, 2020.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Second Quarter 2020 Financial Results

Net income attributable to common stockholders for the second quarter of 2020 was $15.1 million, compared to net loss attributable to common stockholders of $11.0 million in the prior year period. Net income (loss) attributable to common stockholders included non-cash expenses of $19.0 million or $0.79 per share in the second quarter of 2020 compared to $15.9 million or $0.72 per share for the prior year period.

CFFO for the second quarter of 2020 was $5.1 million, or $0.15 per diluted share, compared to $6.7 million, or $0.22 per diluted share, in the prior year period. CFFO was primarily driven by growth in property NOI of $1.5 million, preferred returns of $0.7 million, and a decrease in interest expense of $0.6 million. This was primarily offset by a year-over-year decrease in interest income of $0.6 million, an increase in general and administrative expense of $0.5 million and preferred stock dividends of $3.2 million. CFFO was impacted by the company’s strategic decision to reduce its investment pace in the near term and to increase its cash position.

Total Portfolio Performance

$ In thousands, except average rental rates	2Q20			2Q19			Variance			YTD20			YTD19			Variance
Total Revenues ⁽¹⁾	$	53,033		$	52,437			1.1	%	$	109,274		$	103,902			5.2	%
Property Operating Expenses	$	18,571		$	18,868			(1.6	%)	$	37,870		$	37,470			1.1	%
NOI	$	29,124		$	27,596			5.5	%	$	60,177		$	54,683			10.0	%
Operating Margin		61.1	%		59.4	%		170	bps		61.4	%		59.3	%		210	bps
Occupancy Percentage		94.4	%		93.8	%		60	bps		94.3	%		93.8	%		50	bps
Average Rental Rate	$	1,330		$	1,312			1.4	%	$	1,330		$	1,306			1.8	%

⁽¹⁾

Including interest income from related parties

For the second quarter of 2020, property revenues increased by 2.6% compared to the same prior year period. Total portfolio NOI was $29.1 million, an increase of $1.5 million, or 5.5%, compared to the same period in the prior year. Property NOI margins expanded by 170 basis points to 61.1% of revenue for the quarter, compared to 59.4% of revenue in the prior year quarter.

Same Store Portfolio Performance

$ In thousands, except average rental rates	2Q20			2Q19			Variance			YTD20			YTD19			Variance
Revenues	$	35,113		$	35,265			(0.4	%)	$	70,909		$	69,987			1.3	%
Property Operating Expenses	$	13,897		$	13,804			0.7	%	$	27,870		$	27,286			2.1	%
NOI	$	21,216		$	21,461			(1.1	%)	$	43,039		$	42,701			0.8	%
Operating Margin		60.4	%		60.9	%		(50	)bps		60.7	%		61.0	%		(30	)bps
Occupancy Percentage		94.7	%		93.8	%		90	bps		94.5	%		94.1	%		40	bps
Average Rental Rate	$	1,342		$	1,321			1.6	%	$	1,344		$	1,313			2.4	%

The Company’s same store portfolio for the quarter ended June 30, 2020 included 24 properties. For the second quarter of 2020, same store NOI was $21.2 million, a decrease of $0.2 million, or 1.1%, compared to the same period in the prior year. Same store property revenues decreased by 0.4% compared to the same prior year period, primarily driven by a 90-basis point increase in occupancy and 1.6% increase in average rental rates as twenty of the Company’s twenty-four same store properties recognized rental rate increases during the period, but offset by $0.7 million increase in bad debt expense and $0.3 million less in ancillary income, such as termination fees and late fees, due to the impact of COVID-19 and related Federal and state eviction moratoriums.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Same store expenses increased 0.7%, or $0.09 million, primarily due to non-controllable expenses; real estate taxes increased $0.35 million from prior year due to municipality tax increases and insurance expenses increased $0.15 million due to industrywide multifamily price increases. The increases were partially offset by a $0.20 million decrease in discretionary seasonal maintenance due to COVID-19 and $0.13 million decrease in turnover costs from increased tenant retention.

Renovation Activity

The Company completed 39 value-add unit upgrades during the second quarter achieving a 23.3% ROI. Since inception, within the existing portfolio, the Company has completed 2,804 value-add unit upgrades at an average cost of $5,834 per unit and achieved an average monthly rental rate increase of $114 per unit, equating to a 23.5% ROI on all unit upgrades leased as of June 30, 2020. The Company has identified approximately 4,572 remaining units within the existing portfolio for value-add upgrades with similar projected economics to the completed renovations. Due to the uncertainty surrounding the COVID-19 impact, the Company has temporarily suspended interior renovations at several properties subject to better visibility on the economic recovery, and now expects to complete between 200 and 400 unit renovations in 2020.

Portfolio Activity

The Company completed the following investments:

Made a preferred equity investment in the Strategic Portfolio totaling $3.9 million into the final portfolio operating asset with 328-units called The Commons, located in Jacksonville, Florida.

Funded $12.5 million under existing preferred and mezzanine loan commitments in six investments.

Bought out the noncontrolling interest in The Brodie, in Austin, Texas for $3.5 million and increased our ownership to 100%.

The Company completed the following sales activities:

Closed on the sale of Ashton Reserve for $84.6 million on April 14, 2020 generating net proceeds to the Company of $31.2 million.

Closed on the sale of Marquis at TPC for $22.5 million on April 17, 2020 generating net proceeds to the Company of $5.3 million.

Closed on the sale of Enders Place at Baldwin Park for $53.2 million on April 21, 2020 generating net proceeds to the Company of $24.0 million.

Balance Sheet

As of June 30, 2020, the Company had $236.2 million of unrestricted cash and availability under its revolving credit facilities, and $1.5 billion of indebtedness outstanding.

During the second quarter, the Company raised gross proceeds of approximately $42.8 million through the issuance of 1.7 million shares of Series T Preferred Stock at $25.00 per share. The Series T Preferred Stock continuous offering offers 20,000,000 preferred shares in the primary offering, along with 12,000,000 preferred shares pursuant to a dividend reinvestment plan. The preferred shares are offered at $25.00 per share and pay cumulative monthly dividends at a 6.15% annual rate, along with an annual stock dividend of up to 0.2% for five years.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

The Company repurchased 163,068, 27,905, and 76,264 shares of Series A, C, and D Cumulative Preferred Stock during the second quarter at an average price of $22.84, $23.00, and $22.75 per share, respectively, under its $50.0 million share repurchase plan announced in December 2019.

Dividend

The Board of Directors authorized, and the Company declared, a quarterly cash dividend for the second quarter of 2020 equal to a quarterly rate of $0.1625 per share on its Class A and Class C common stock, payable to the stockholders of record as of June 25, 2020, and was paid on July 2, 2020. A portion of each dividend may constitute a return of capital for tax purposes.

The Board of Directors authorized, and the Company declared, a quarterly cash dividend on its 8.250% Series A Cumulative Redeemable Preferred Stock for the second quarter of 2020, in the amount of $0.515625 per share. In addition, the Board of Directors authorized, and the Company declared, a quarterly cash dividend on its 7.625% Series C Cumulative Redeemable Preferred Stock for the second quarter of 2020, in the amount of $0.4765625 per share. Further, the Board of Directors authorized, and the Company declared, a quarterly cash dividend on its 7.125% Series D Cumulative Preferred Stock for the second quarter of 2020, in the amount of $0.4453125 per share. The dividends were payable to the stockholders of record as of June 25, 2020, and were paid on July 2, 2020.

The Board of Directors authorized, and the Company declared, a monthly dividend of $5.00 per share of Series B Preferred Stock, payable to the stockholders of record as of April 24, 2020, May 22, 2020, and June 25, 2020 which were paid in cash on May 5, 2020, June 5, 2020 and July 2, 2020, respectively.

The Board of Directors authorized, and the Company declared a monthly dividend of $0.128125 per share of Series T Preferred Stock, prorated on the basis of the actual number of days in the applicable dividend period during which each share was outstanding. Such pro-rated dividends were payable to the stockholders of record as of April 24, 2020, May 22, 2020, and June 25, 2020, which were paid in cash on May 5, 2020, June 5, 2020, and July 2, 2020, respectively.

On July 10, 2020, the Board of Directors authorized, and the Company declared, a monthly dividend of $5.00 per share of Series B Preferred Stock, payable to the stockholders of record as of July 24, 2020, which was paid in cash on August 5, 2020, and as of August 25, 2020, and September 25, 2020, which will be paid in cash on September 4, 2020 and October 5, 2020, respectively.

On July 10, 2020, the Board of Directors authorized, and the Company declared a monthly dividend of $0.128125 per share of Series T Preferred Stock, prorated on the basis of the actual number of days in the applicable dividend period during which each share was outstanding. Such pro-rated dividends are payable to the stockholders of record as of July 24, 2020, which was paid in cash on August 5, 2020, and as of August 25, 2020, and September 25, 2020, which will be paid in cash on September 4, 2020 and October 5, 2020, respectively.

2020 Guidance

The Company withdrew its full year 2020 guidance on May 11, 2020, due to inherent uncertainty regarding the economic effects of the COVID-19 pandemic.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Conference Call

All interested parties can listen to the live conference call at 11:00 AM ET on Monday, August 10, 2020 by dialing +1 (866) 843-0890 within the U.S., or +1 (412) 317-6597, and requesting the "Bluerock Residential Conference."

For those who are not available to listen to the live call, the conference call will be available for replay on the Company’s website two hours after the call concludes, and will remain available until September 10, 2020 at http://services.choruscall.com/links/brg200810.html, as well as by dialing +1 (877) 344-7529 in the U.S., or +1 (412) 317-0088 internationally, and requesting conference number 10146336.

The full text of this Earnings Release and additional Supplemental Information is available in the Investor Relations section on the Company’s website at http://www.bluerockresidential.com.

About Bluerock Residential Growth REIT, Inc.

Bluerock Residential Growth REIT, Inc. (NYSE American: BRG) is a real estate investment trust that focuses on developing and acquiring a diversified portfolio of institutional-quality highly amenitized live/work/play apartment communities in demographically attractive knowledge economy growth markets to appeal to the renter by choice. The Company’s objective is to generate value through off-market/relationship-based transactions and, at the asset level, through value add improvements to properties and operations. The Company is included in the Russell 2000 and Russell 3000 Indexes. BRG has elected to be taxed as a real estate investment trust (REIT) for U.S. federal income tax purposes.

For more information, please visit the Company’s website at www.bluerockresidential.com.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are based upon the Company’s present expectations, but these statements are not guaranteed to occur. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward-looking statements. Although the Company believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions, the Company’s actual results and performance could differ materially from those set forth in these forward-looking statements due to numerous factors. Currently, one of the most significant factors is the potential adverse effect of the COVID-19 pandemic on the financial condition, results of operations, cash flows and performance of the Company and its tenants, partners and employees, as well as the real estate market and the global economy and financial markets. The extent to which COVID-19 impacts the Company and its tenants, partners and employees will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact (including governmental actions that may vary by jurisdiction, such as mandated business closing; stay-at-home orders; limits on group activity; and actions to protect residential tenants from eviction), and the direct and indirect economic effects of the pandemic and containment measures, including national and local employment rates and the corresponding impact on the Company’s tenants’ ability to pay their rent on time or at all, among others. For further discussion of the factors that could affect outcomes, please refer to the risk factors set forth in Item 1A of the Company’s Annual Report on Form 10-K filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) on February 24, 2020, and subsequent filings by the Company with the SEC. We claim the safe harbor protection for forward looking statements contained in the Private Securities Litigation Reform Act of 1995.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Portfolio Summary

The following is a summary of our operating real estate and mezzanine/preferred/ground lease investments as of June 30, 2020:

Consolidated Operating Properties	Location	Number of Units	Year Built/ Renovated ⁽¹⁾	Ownership Interest			Average Rent ⁽²⁾			% Occupied ⁽³⁾

ARIUM Glenridge	Atlanta, GA	480	1990		90	%	$	1,279			93.1	%
ARIUM Grandewood	Orlando, FL	306	2005		100	%		1,437			95.4	%
ARIUM Hunter’s Creek	Orlando, FL	532	1999		100	%		1,444			96.1	%
ARIUM Metrowest	Orlando, FL	510	2001		100	%		1,451			95.3	%
ARIUM Westside	Atlanta, GA	336	2008		90	%		1,545			93.2	%
Ashford Belmar	Lakewood, CO	512	1988/1993		85	%		1,646			97.3	%
Avenue 25	Phoenix, AZ	254	2013		100	%		1,198			96.1	%
Cade Boca Raton	Boca Raton, FL	90	2019		81	%		2,851			94.4	%
Chattahoochee Ridge	Atlanta, GA	358	1996		90	%		1,355			95.3	%
Citrus Tower	Orlando, FL	336	2006		97	%		1,365			93.5	%
Denim	Scottsdale, AZ	645	1979		100	%		1,225			96.9	%
Element	Las Vegas, NV	200	1995		100	%		1,251			96.5	%
Falls at Forsyth	Cumming, GA	356	2019		100	%		1,370			88.2	%
Gulfshore Apartment Homes	Naples, FL	368	2016		100	%		1,295			92.9	%
James on South First	Austin, TX	250	2016		90	%		1,331			97.6	%
Marquis at The Cascades	Tyler, TX	582	2009		90	%		1,229			94.0	%
Navigator Villas	Pasco, WA	176	2013		90	%		1,096			96.0	%
Outlook at Greystone	Birmingham, AL	300	2007		100	%		1,038			97.0	%
Park & Kingston	Charlotte, NC	168	2015		100	%		1,327			94.6	%
Pine Lakes Preserve	Port St. Lucie, FL	320	2003		100	%		1,338			97.8	%
Plantation Park	Lake Jackson, TX	238	2016		80	%		1,315			95.8	%
Providence Trail	Mount Juliet, TN	334	2007		100	%		1,251			95.5	%
Roswell City Walk	Roswell, GA	320	2015		98	%		1,568			95.9	%
Sands Parc	Daytona Beach, FL	264	2017		100	%		1,375			94.7	%
The Brodie	Austin, TX	324	2001		100	%		1,319			96.9	%
The District at Scottsdale	Scottsdale, AZ	332	2018		100	%		1,864			74.4	%
The Links at Plum Creek	Castle Rock, CO	264	2000		88	%		1,424			97.0	%
The Mills	Greenville, SC	304	2013		100	%		1,049			94.7	%
The Preserve at Henderson Beach	Destin, FL	340	2009		100	%		1,482			95.0	%
The Reserve at Palmer Ranch	Sarasota, FL	320	2016		100	%		1,331			96.3	%
The Sanctuary	Las Vegas, NV	320	1988		100	%		1,059			98.4	%
Veranda at Centerfield	Houston, TX	400	1999		93	%		990			96.0	%
Villages of Cypress Creek	Houston, TX	384	2001		80	%		1,169			95.3	%
Wesley Village	Charlotte, NC	301	2010		100	%		1,363			94.0	%
Subtotal/Average		11,524					$	1,329	^{(4) (5)}		95.3	%⁽⁴⁾

Mezzanine/Preferred/Ground Lease Investments	Location	Planned Number of Units						Pro Forma Average Rent
Alexan CityCentre	Houston, TX	340					$	1,800	⁽²⁾
Alexan Southside Place	Houston, TX	270						1,716	⁽²⁾
Arlo	Charlotte, NC	286						1,507
Belmont Crossing	Smyrna, GA	192						772	⁽²⁾
Domain at The One Forty	Garland, TX	299						1,410	⁽²⁾
Georgetown Crossing	Savannah, GA	168						938	⁽²⁾
Mira Vista	Austin, TX	200						1,035	⁽²⁾
Motif	Fort Lauderdale, FL	385						2,352
North Creek Apartments	Leander, TX	259						1,358
Novel Perimeter	Atlanta, GA	320						1,749
Park on the Square	Pensacola, FL	240						1,067	⁽²⁾
Riverside Apartments	Austin, TX	222						1,408
Sierra Terrace	Atlanta, GA	135						1,192	⁽²⁾
Sierra Village	Atlanta, GA	154						1,091	⁽²⁾
The Commons	Jacksonville, FL	328						819	⁽²⁾
The Park at Chapel Hill	Chapel Hill, NC	*						*
Thornton Flats	Austin, TX	104						1,517	⁽²⁾
Vickers Historic Roswell	Roswell, GA	79						3,176
Wayforth at Concord	Concord, NC	150						1,707
Zoey	Austin, TX	307						1,762
Subtotal/Average		4,438					$	1,512

Portfolio Properties Total/Average		15,962					$	1,380	^{(4) (6)}

⁽¹⁾

Represents date of last significant renovation or year built if no renovations.

⁽²⁾

Represents the average effective monthly rent per occupied unit for the three months ended June 30, 2020.

⁽³⁾

Percent occupied is calculated as (i) the number of units occupied as of June 30, 2020, divided by (ii) total number of units, expressed as a percentage.

⁽⁴⁾

Excludes The District at Scottsdale, which is in lease-up.

⁽⁵⁾

The average effective monthly rent including sold properties was $1,330 for the three months ended June 30, 2020.

⁽⁶⁾

The average effective monthly rent was not impacted by the sold properties for the three months ended June 30, 2020.

The development is in the planning phase; project specifications are in process.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Consolidated Statement of Operations

For the Three and Six Months Ended June 30, 2020 and 2019

(Unaudited and dollars in thousands except for share and per share data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Revenues
Rental and other property revenues	$	47,695		$	46,464		$	98,047		$	92,153
Interest income from related parties and ground leases		5,338			5,973			11,227			11,749
Total revenues		53,033			52,437			109,274			103,902
Expenses
Property operating		18,571			18,868			37,870			37,470
Property management fees		1,194			1,235			2,488			2,451
General and administrative		5,303			5,046			11,674			10,674
Acquisition and pursuit costs		423			70			1,691			128
Weather-related losses, net		—			291			—			291
Depreciation and amortization		20,067			16,226			40,990			33,454
Total expenses		45,558			41,736			94,713			84,468
Operating income		7,475			10,701			14,561			19,434
Other income (expense)
Other income		19			—			59			—
Preferred returns on unconsolidated real estate joint ventures		2,834			2,492			5,249			4,781
Gain on sale of real estate investments		57,843			—			58,096			—
Gain on sale of non-depreciable real estate investments		—			—			—			679
Loss on extinguishment of debt and debt modification costs		(13,985	)		—			(13,985	)		—
Interest expense, net		(13,859	)		(15,125	)		(28,774	)		(31,191	)
Total other income (expense)		32,852			(12,633	)		20,645			(25,731	)
Net income (loss)		40,327			(1,932	)		35,206			(6,297	)
Preferred stock dividends		(14,237	)		(11,019	)		(27,784	)		(21,403	)
Preferred stock accretion		(3,602	)		(2,316	)		(7,527	)		(4,203	)
Net income (loss) attributable to noncontrolling interests
Operating Partnership units		5,413			(3,887	)		(409	)		(7,938	)
Partially owned properties		1,985			(390	)		1,707			(882	)
Net income (loss) attributable to noncontrolling interests		7,398			(4,277	)		1,298			(8,820	)
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)

Net income (loss) per common share - Basic	$	0.61		$	(0.50	)	$	(0.09	)	$	(1.03	)

Net income (loss) per common share – Diluted	$	0.61		$	(0.50	)	$	(0.09	)	$	(1.03	)

Weighted average basic common shares outstanding		24,307,147			22,430,619			24,197,479			22,775,203
Weighted average diluted common shares outstanding		24,345,034			22,430,619			24,197,479			22,775,203

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Consolidated Balance Sheets

Second Quarter 2020

(Unaudited and dollars in thousands except for share and per share amounts)

	June 30, 2020			December 31, 2019
ASSETS
Net Real Estate Investments
Land	$	267,589		$	268,244
Buildings and improvements		1,778,750			1,752,738
Furniture, fixtures and equipment		70,151			67,904
Total Gross Real Estate Investments		2,116,490			2,088,886
Accumulated depreciation		(158,896	)		(141,566	)
Total Net Real Estate Investments		1,957,594			1,947,320
Cash and cash equivalents		211,968			31,683
Restricted cash		29,732			19,085
Notes and accrued interest receivable from related parties		178,015			193,781
Due from affiliates		309			2,969
Accounts receivable, prepaids and other assets		20,440			16,317
Preferred equity investments and investments in unconsolidated real estate joint ventures		107,610			126,444
In-place lease intangible assets, net		584			3,098
Total Assets	$	2,506,252		$	2,340,697

LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY
Mortgages payable	$	1,405,046		$	1,425,257
Revolving credit facilities		130,500			18,000
Accounts payable		1,885			1,488
Other accrued liabilities		29,670			27,499
Due to affiliates		727			790
Distributions payable		14,498			13,541
Total Liabilities		1,582,326			1,486,575
8.250% Series A Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 10,875,000 shares authorized; 5,558,392 and 5,721,460 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		136,778			140,355
6.000% Series B Redeemable Preferred Stock, liquidation preference $1,000 per share, 1,225,000 shares authorized; 516,738 and 536,695 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		467,237			480,921
7.625% Series C Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,295,845 and 2,323,750 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		56,279			56,797
6.150% Series T Redeemable Preferred Stock, liquidation preference $25.00 per share, 32,000,000 shares authorized; 4,025,663 and 17,400 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		90,925			388
Equity
Stockholders’ Equity
Preferred stock, $0.01 par value, 197,900,000 shares authorized; no shares issued and outstanding		—			—
7.125% Series D Cumulative Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,774,338 and 2,850,602 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		66,867			68,705
Common stock - Class A, $0.01 par value, 747,509,582 shares authorized; 24,605,585 and 23,422,557 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		246			234
Common stock - Class C, $0.01 par value, 76,603 shares authorized; 76,603 shares issued and outstanding as of June 30, 2020 and December 31, 2019		1			1
Additional paid-in-capital		321,973			311,683
Distributions in excess of cumulative earnings		(262,455	)		(253,132	)
Total Stockholders’ Equity		126,632			127,491
Noncontrolling Interests
Operating Partnership units		20,130			19,331
Partially owned properties		25,945			28,839
Total Noncontrolling Interests		46,075			48,170
Total Equity		172,707			175,661
TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY	$	2,506,252		$	2,340,697

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Non-GAAP Financial Measures

The foregoing supplemental financial data includes certain non-GAAP financial measures that we believe are helpful in understanding our business and performance, as further described below. Our definition and calculation of these non-GAAP financial measures may differ from those of other REITs, and may, therefore, not be comparable.

Funds from Operations and Core Funds from Operations

We believe that funds from operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and core funds from operations (“CFFO”) are important non-GAAP supplemental measures of operating performance for a REIT.

FFO attributable to common shares and units is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We consider FFO to be an appropriate supplemental measure of our operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. We define FFO, consistent with the NAREIT definition, as net income, computed in accordance with GAAP, excluding gains or losses on sales of depreciable real estate property, plus depreciation and amortization of real estate assets, plus impairment write-downs of depreciable real estate, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis.

CFFO makes certain adjustments to FFO, removing the effect of items that do not reflect ongoing property operations such as acquisition expenses, non-cash interest, unrealized gains and losses on derivatives, losses on extinguishment of debt and debt modification costs (includes prepayment penalties incurred and the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt), one-time weather-related costs, gain or losses on sales of non-depreciable real estate property, shareholder activism, stock compensation expense and preferred stock accretion. Commencing January 1, 2020, we did not deduct the accrued portion of the preferred income on our preferred equity investments from FFO to determine CFFO as the income is deemed fully collectible. The accrued portion of the preferred income totaled $0.4 million and $0.8 million for the three and six months ended June 30, 2020, respectively. We believe that CFFO is helpful to investors as a supplemental performance measure because it excludes the effects of certain items which can create significant earnings volatility, but which do not directly relate to our core recurring property operations. As a result, we believe that CFFO can help facilitate comparisons of operating performance between periods and provides a more meaningful predictor of future earnings potential.

Our calculation of CFFO differs from the methodology used for calculating CFFO by certain other REITs and, accordingly, our CFFO may not be comparable to CFFO reported by other REITs. Our management utilizes FFO and CFFO as measures of our operating performance after adjustment for certain non-cash items, such as depreciation and amortization expenses, and acquisition and pursuit costs that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and that may not accurately compare our operating performance between periods. Furthermore, although FFO and CFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we also believe that FFO and CFFO may provide us and our stockholders with an additional useful measure to compare our financial performance to certain other REITs.

Neither FFO nor CFFO is equivalent to net income, including net income attributable to common stockholders, or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and CFFO do not represent amounts available for management's discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Neither FFO nor CFFO should be considered as an alternative to net income, including net income attributable to common stockholders, as an indicator of our operating performance or as an alternative to cash flow from operating activities as a measure of our liquidity.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

We have acquired seven operating properties and made nine investments through preferred equity interests and ground lease investments and sold twelve operating properties subsequent to June 30, 2019. The results presented in the table below are not directly comparable and should not be considered an indication of our future operating performance.

The table below reconciles our calculations of FFO and CFFO to net income (loss), the most directly comparable GAAP financial measure, for the three and six months ended June 30, 2020 and 2019 (in thousands, except per share amounts):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)
Add back: Net income (loss) attributable to Operating Partnership Units		5,413			(3,887	)		(409	)		(7,938	)
Net income (loss) attributable to common stockholders and unit holders		20,503			(14,877	)		(1,812	)		(31,021	)
Common stockholders and Operating Partnership Units pro-rata share of:
Real estate depreciation and amortization ⁽¹⁾		19,144			15,290			39,045			31,432
Gain on sale of real estate investments		(55,250	)		—			(55,360	)		—
FFO Attributable to Common Stockholders and Unit Holders		(15,603	)		413			(18,127	)		411
Common stockholders and Operating Partnership Units pro-rata share of:
Acquisition and pursuit costs		423			70			1,691			128
Non-cash interest expense		747			786			1,592			1,561
Unrealized (gain) loss on derivatives		(5	)		652			(30	)		2,287
Loss on extinguishment of debt and debt modification costs		13,590			—			13,590			—
Weather-related losses, net		—			249			—			249
Non-real estate depreciation and amortization		122			84			242			170
Gain on sale of non-depreciable real estate investments		—			—			—			(679	)
Shareholder activism		—			55			—			393
Non-recurring expense, net		43			—			3			—
Non-cash preferred returns on unconsolidated real estate joint ventures		—			(386	)		—			(598	)
Non-cash equity compensation		2,191			2,427			5,738			4,819
Preferred stock accretion		3,602			2,316			7,527			4,203
CFFO Attributable to Common Stockholders and Unit Holders	$	5,110		$	6,666		$	12,226		$	12,944

Per Share and Unit Information:
FFO Attributable to Common Stockholders and Unit Holders - diluted	$	(0.47	)	$	0.01		$	(0.55	)	$	0.01
CFFO Attributable to Common Stockholders and Unit Holders - diluted	$	0.15		$	0.22		$	0.37		$	0.42

Weighted average common shares and units outstanding - diluted		33,075,598			30,550,863			32,936,762			30,704,271

⁽¹⁾

The real estate depreciation and amortization amount includes our share of consolidated real estate-related depreciation and amortization of intangibles, less amounts attributable to noncontrolling interests for partially owned properties, and our similar estimated share of unconsolidated depreciation and amortization, which is included in earnings of our unconsolidated real estate joint venture investments.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate ("EBITDAre")

NAREIT defines earnings before interest, taxes, depreciation and amortization for real estate ("EBITDAre") (September 2017 White Paper) as net income (loss), computed in accordance with GAAP, before interest expense, income taxes, depreciation and amortization expense, and further adjusted for gains and losses from sales of depreciated operating properties, and impairment write-downs of depreciated operating properties.

We consider EBITDAre to be an appropriate supplemental measure of our performance because it eliminates depreciation, income taxes, interest and non-recurring items, which permits investors to view income from operations unobscured by non-cash items such as depreciation, amortization, the cost of debt or non-recurring items.

Adjusted EBITDAre represents EBITDAre further adjusted for non-comparable items and it is not intended to be a measure of free cash flow for our management’s discretionary use, as it does not consider certain cash requirements such as income tax payments, debt service requirements, capital expenditures and other fixed charges.

EBITDAre and Adjusted EBITDAre are not recognized measurements under GAAP. Because not all companies use identical calculations, our presentation of EBITDAre and Adjusted EBITDAre may not be comparable to similarly titled measures of other companies.

Below is a reconciliation of net income (loss) attributable to common stockholders to EBITDAre (unaudited and dollars in thousands).

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)
Net income (loss) attributable to noncontrolling interests		7,398			(4,277	)		1,298			(8,820	)
Preferred stock dividends		14,237			11,019			27,784			21,403
Preferred stock accretion		3,602			2,316			7,527			4,203
Interest expense, net		13,859			15,125			28,774			31,191
Depreciation and amortization		20,020			16,142			40,899			33,284
Gain on sale of real estate investments		(57,843	)		—			(58,096	)		—
Loss on extinguishment of debt and debt modification costs		13,985			—			13,985			—
EBITDAre	$	30,348		$	29,335		$	60,768		$	58,178
Acquisition and pursuit costs		423			70			1,691			128
Non-real estate depreciation and amortization		122			84			242			170
Weather-related losses, net		—			291			—			291
Gain on sale of non-depreciable real estate investments		—			—			—			(679	)
Shareholder activism		—			55			—			393
Non-cash equity compensation		2,191			2,427			5,738			4,819
Non-recurring expense, net		43			—			3			—
Non-cash preferred returns on unconsolidated real estate joint ventures		—			(386	)		—			(598	)
Adjusted EBITDAre	$	33,127		$	31,876		$	68,442		$	62,702

Same Store Properties

Same store properties are conventional multifamily residential apartments which were owned and operational for the entire periods presented, including each comparative period.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Property Net Operating Income ("Property NOI")

We believe that net operating income, or NOI, is a useful measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding depreciation and amortization and interest. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income. We use NOI to evaluate our performance on a same store and non-same store basis; NOI measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as a supplemental measure of our financial performance.

The following table reflects net income (loss) attributable to common stockholders together with a reconciliation to NOI and to same store and non-same store contributions to consolidated NOI, as computed in accordance with GAAP for the periods presented (unaudited and amounts in thousands):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)
Add back: Net income (loss) attributable to Operating Partnership Units		5,413			(3,887	)		(409	)		(7,938	)
Net income (loss) attributable to common stockholders and unit holders		20,503			(14,877	)		(1,812	)		(31,021	)
Add common stockholders and Operating Partnership Units pro-rata share of:
Depreciation and amortization		19,144			15,290			39,045			31,432
Non-real estate depreciation and amortization		122			84			242			170
Non-cash interest expense		747			786			1,592			1,561
Unrealized (gain) loss on derivatives		(5	)		652			(30	)		2,287
Loss on extinguishment of debt and debt modification costs		13,590			—			13,590			—
Property management fees		1,135			1,170			2,367			2,318
Acquisition and pursuit costs		423			70			1,691			128
Corporate operating expenses		5,166			4,975			11,462			10,529
Weather-related losses, net		—			249			—			249
Preferred dividends		14,237			11,019			27,784			21,403
Preferred stock accretion		3,602			2,316			7,527			4,203
Less common stockholders and Operating Partnership Units pro-rata share of:
Non-recurring expense, net		(43	)		—			(3	)		—
Preferred returns on unconsolidated real estate joint ventures		2,834			2,492			5,408			4,781
Interest income from related parties and ground leases		5,338			5,973			11,227			11,749
Gain on sale of real estate investments		55,250			—			55,360			—
Gain on sale of non-depreciable real estate investments		—			—			—			679
Pro-rata share of properties’ income		15,285			13,269			31,466			26,050
Add:
Noncontrolling interest pro-rata share of partially owned property income		750			690			1,553			1,418
Total property income		16,035			13,959			33,019			27,468
Add:
Interest expense		13,089			13,637			27,158			27,215
Net operating income		29,124			27,596			60,177			54,683
Less:
Non-same store net operating income		7,908			6,135			17,138			11,982
Same store net operating income ⁽¹⁾	$	21,216		$	21,461		$	43,039		$	42,701

⁽¹⁾

Same store portfolio for the three and six months ended June 30, 2020 consists of 24 properties, which represent 8,459 units.

Bluerock Residential Growth REIT, Inc.

Second Quarter Earnings Release

Contact

Investors:

(888) 558.1031
investor.relations@bluerockre.com

Media:

Josh Hoffman

(208) 475.2380

jhoffman@bluerockre.com

Bluerock Residential Growth REIT, Inc.

Financial and Operating Highlights

For the Three and Six Months Ended June 30, 2020

(Unaudited and dollars in thousands except for share and per share data)

	Three Months Ended									Six Months Ended
	June 30,									June 30,
OPERATING INFORMATION	2020			2019			% Change			2020			2019			% Change

Total revenue	$	53,033		$	52,437			1.1	%	$	109,274		$	103,902			5.2	%

Total assets	$	2,506,252		$	2,135,708			17.3	%	$	2,506,252		$	2,135,708			17.3	%

Property NOI ⁽¹⁾	$	29,124		$	27,596			5.5	%	$	60,177		$	54,683			10.0	%

Property NOI margins		61.1	%		59.4	%		2.9	%		61.4	%		59.3	%		3.5	%

Net income (loss) per common share - Diluted	$	0.61		$	(0.50	)		-		$	(0.09	)	$	(1.03	)		-

CFFO attributable to common stockholders and unit holders per share ⁽²⁾	$	0.15		$	0.22			(31.8	%)	$	0.37		$	0.42			(11.9	%)

⁽¹⁾

See page 34 for the Company's definition of this non-GAAP measurement and reasons for using it.

⁽²⁾

See page 32 for the Company's definition of this non-GAAP measurement and reasons for using it.

Bluerock Residential Growth REIT, Inc.

Share and Unit Information

Second Quarter 2020

(Unaudited)

Weighted Average Common Stock and Units Outstanding for the quarter ended June 30, 2020
Class A Common Stock			24,230,544
Class C Common Stock			76,603
Weighted Average Common Stock Outstanding, Diluted			24,307,147
Restricted Stock Grants ⁽¹⁾			37,887
Weighted Average Common Stock Outstanding, Diluted			24,345,034
OP Units			6,363,017
LTIP Units			2,367,547
Weighted Average Common Stock and Total Units Outstanding, Diluted			33,075,598

Outstanding Common Stock and Units at June 30, 2020			34,902,956

Outstanding 8.250% Series A Cumulative Redeemable Preferred Stock at June 30, 2020			5,558,392

Outstanding 6.000% Series B Redeemable Preferred Stock at June 30, 2020			516,738

Outstanding 7.625% Series C Cumulative Redeemable Preferred Stock at June 30, 2020			2,295,845

Outstanding 7.125% Series D Cumulative Preferred Stock at June 30, 2020			2,774,338

Outstanding 6.150% Series T Redeemable Preferred Stock at June 30, 2020			4,025,663

⁽¹⁾

Potential dilution from vesting of restricted stock grants issued to employees for 37,887 shares of common stock.

The following table reflects the impact of various LTIP Unit issuances, share repurchases, and other share/unit changes subsequent to March 31, 2020:

Share Type	Shares and units outstanding March 31, 2020		Class A common from OP unit conversion			Class A common from Series B holder redemptions		Restricted Stock Grants		LTIP Issuances		Other		Shares and units outstanding June 30, 2020		Ownership %
Class A Common Stock		24,015,484		69,713			406,993		89,054		-		24,341		24,605,585		70.50	%
Class C Common Stock		76,603		-			-		-		-		-		76,603		0.22	%
Total share equivalents		24,092,087		69,713			406,993		89,054		-		24,341		24,682,188		70.72	%
OP Units		6,384,467		(69,713	)		-		-		-		-		6,314,754		18.09	%
LTIP Units		3,411,026		-			-		-		494,988		-		3,906,014		11.19	%
Total noncontrolling interest		9,795,493		(69,713	)		-		-		494,988		-		10,220,768		29.28	%
Total shares, OP and LTIP Units		33,887,580		-			406,993		89,054		494,988		24,341		34,902,956		100.00	%

Bluerock Residential Growth REIT, Inc.

EBITDAre and Interest Information

Second Quarter 2020

(Unaudited and dollars in thousands)

	Three Months Ended
	June 30,
	2020
Q2 EBITDAre Calculation
Net income attributable to common stockholders	$	15,090
Net income attributable to noncontrolling interests		7,398
Preferred stock dividends		14,237
Preferred stock accretion		3,602
Interest expense, net		13,859
Depreciation and amortization		20,020
Gain on sale of real estate investments		(57,843	)
Loss on extinguishment of debt and debt modification costs		13,985
EBITDAre ⁽¹⁾	$	30,348
Acquisition and pursuit costs		423
Non-real estate depreciation and amortization		122
Non-cash equity compensation		2,191
Non-recurring expense, net		43
Adjusted EBITDAre	$	33,127

Modified Q2 EBITDAre Calculation ⁽²⁾
Adjusted EBITDAre	$	33,127
Adjustment		14
Modified Q2 EBITDAre	$	33,141
Modified Q2 EBITDAre annualized	$	132,564

Modified Q2 Interest Calculation ⁽²⁾⁽³⁾
Interest expense	$	13,089
Adjustment		(138	)
Modified Q2 interest expense	$	12,951
Modified Q2 interest expense annualized	$	51,804

⁽¹⁾

See page 33 for a reconciliation of net income attributable to common stockholders to EBITDAre and the Company's definition of EBITDAre and reasons for using it.

⁽²⁾

Adjustment to EBITDAre and interest expense represents the estimated impact over the full period of the following activity assuming the transactions had occurred on April 1, 2020: (iii) sales of Ashton Reserve, Marquis at TPC, and Enders Place at Baldwin Park and (ii) additional investments at Arlo, Motif, North Creek Apartments, Novel Perimeter, Riverside Apartments, Strategic Portfolio, and The Park at Chapel Hill. Actual results may differ significantly from the presented, adjusted amounts including annualized amounts.

⁽³⁾

Interest expense excludes non-cash interest expense.

Bluerock Residential Growth REIT, Inc.

Financial Statistics

Second Quarter 2020

(Unaudited and dollars in thousands)

	Three Months Ended
	June 30,
	2020
Interest Coverage Ratio
Modified Q2 EBITDAre *	$	33,141
Modified Q2 interest expense ⁽⁴⁾ *		12,951
Interest coverage ratio		2.56	x

Quarterly Fixed Charge Coverage Ratio
Modified Q2 interest expense ⁽⁴⁾ *	$	12,951
Preferred stock dividends		14,237
Total fixed charges	$	27,188
Modified Q2 EBITDAre *		33,141
Modified Q2 EBITDAre fixed charge coverage ratio		1.22	x

Net Debt / Modified EBITDAre Ratio
Total debt ⁽¹⁾	$	1,544,501
Less: cash ⁽³⁾		(241,700	)
Net debt (total debt less cash)	$	1,302,801
Modified Q2 EBITDAre (annualized)*		132,564
Net debt / modified EBITDAre ratio		9.83	x

Leverage as a Percentage of Assets
Total debt ⁽¹⁾	$	1,544,501
Total undepreciated assets ⁽²⁾		2,665,148
Total debt / total undepreciated assets		58.0	%
Net debt / net undepreciated assets (less cash)		53.8	%

Leverage as a Percentage of Enterprise Value
Total market cap ⁽⁵⁾	$	1,148,078
Total debt ⁽¹⁾		1,544,501
Total enterprise value	$	2,692,579
Total debt / total enterprise value		57.4	%
Net debt / total enterprise value		48.4	%

⁽¹⁾

Total debt excludes amortization of fair market value adjustments of $2.4 million and deferred financing costs of $11.3 million.

⁽²⁾

Total undepreciated assets is calculated as total assets plus accumulated depreciation on real estate assets.

⁽³⁾

Cash includes cash, cash equivalents, and restricted cash.

⁽⁴⁾

Interest expense excludes non-cash interest expense.

⁽⁵⁾

Total market cap is calculated by using common shares, preferred shares, and equivalents (OP Units/LTIP Units) multiplied by the June 30, 2020 closing share prices.

Bluerock Residential Growth REIT, Inc.

Recent Acquisitions and Investments

(Unaudited)

Property	MSA	Date of Investment	Year Built/ Renovated ⁽¹⁾		Number of Units		Ownership Interest in Property			Purchase Price (in millions)		Average Rent ⁽²⁾
Operating Properties
Avenue 25	Phoenix, AZ	1/23/2020		2013		254		100	%	$	55.6	$	1,198
Falls at Forsyth	Atlanta, GA	3/06/2020		2019		356		100	%		82.5		1,370
Total/Average						610				$	138.1	$	1,294

Property	MSA	Date of Investment		Year Built/ Renovated ⁽¹⁾		Number of Units					Investment Amount (in millions)		Average Rent ⁽²⁾
Preferred Equity
Georgetown Crossing	Savannah, GA	3/20/2020		1994		168				$	2.2	$	938
Park on the Square	Pensacola, FL	3/20/2020		1999		240					5.8		1,067
The Commons	Jacksonville, FL	5/08/2020		1975		328					3.9		819
Total Preferred Equity						736					11.9		950

Ground Lease
Zoey ⁽³⁾	Austin, TX	3/04/2020		2022		307					3.1		1,762
Total Ground Lease						307					3.1		1,762

Total/Average						1,043				$	15.0	$	1,228

⁽¹⁾

All dates are for the year construction was completed or expects to be completed, or the date that a significant renovation has or will be completed.

⁽²⁾

Represents the average effective monthly rent per occupied unit for the three months ended June 30, 2020. The average rent for the development project represents the average pro forma effective monthly rent per occupied unit for all expected units upon stabilization.

⁽³⁾

Property is a development project. The Company acquired land and entered into a ground lease.

Bluerock Residential Growth REIT, Inc.

Recent Dispositions

(Unaudited and dollars in millions)

Property	Location	Date Sold	Number of Units		Ownership Interest in Property			Sale Price		BRG Net Proceeds

Operating Properties
Ashton Reserve	Charlotte, NC	4/14/2020		473		100	%	$	84.6	$	31.2
Marquis at TPC	San Antonio, TX	4/17/2020		139		90	%		22.5		5.3
Enders Place at Baldwin Park	Orlando, FL	4/21/2020		220		92	%		53.2		24.0
Total Operating Properties				832					160.3		60.5

Preferred Equity
Helios	Atlanta, GA	1/08/2020		282		—			65.6		22.7
Whetstone Apartments	Durham, NC	1/24/2020		204		—			46.5		19.6
Total Preferred Equity				486					112.1		42.3

Total				1,318				$	272.4	$	102.8

Bluerock Residential Growth REIT, Inc.

Investments in Unconsolidated Real Estate Joint Ventures, Notes and Accrued Interest Receivable from Related Parties, and Ground Lease

For the Three and Six Months Ended June 30, 2020

(Unaudited and dollars in thousands)

Multifamily Community Name	Investment Balance as of March 31, 2020		Change			Investment Balance as of June 30, 2020		Return as of June 30, 2020			CFFO Earned for the Three Months Ended June 30, 2020		CFFO Earned for the Six Months Ended June 30, 2020
Preferred Equity Investments
Operating – Stabilized
Alexan CityCentre	$	13,980	$	-		$	13,980		17.7	%	$	616		1,207
Alexan Southside Place		25,496		-			25,496		5.0	%		318		632
Mira Vista		5,250		-			5,250		10.1	%		134		268
Strategic Portfolio		18,228		3,877			22,105		10.5	%		544		841
Thornton Flats		4,600		-			4,600		9.0	%		103		206
Total operating - stabilized		67,554		3,877			71,431					1,715		3,154

Lease-up
North Creek Apartments		15,248		192			15,440		12.5	%		485		961
Wayforth at Concord		6,500		-			6,500		13.0	%		213		408
Total lease-up		21,748		192			21,940					698		1,369

Development
Riverside Apartments		13,254		168			13,422		12.5	%		421		829
Total development		13,254		168			13,422					421		829

Sold
Helios ⁽¹⁾		642		-			642		-			-		(16	)
Leigh House ⁽²⁾		80		-			80		-			-		-
Whetstone Apartments		-		-			-		-			-		56
Total sold		722		-			722					-		40

Other		94		1			95		(3	)		-		-
	$	103,372	$	4,238		$	107,610				$	2,834	$	5,392

Mezzanine Loans
Operating - Stabilized
Domain at The One Forty ⁽³⁾	$	23,822	$	(4	)	$	23,818		5.5	%	$	325	$	647
Total operating - stabilized		23,822		(4	)		23,818					325		647

Lease-up
Arlo ⁽³⁾		28,601		646			29,247		15.0	%		1,068		2,087
Motif ⁽³⁾		67,436		8,035			75,471		12.9	%		2,297		4,697
Novel Perimeter ⁽³⁾		20,867		1,356			22,223		15.0	%		795		1,566
Vickers Historic Roswell ⁽³⁾		11,624		(5	)		11,619		15.0	%		430		859
Total lease-up		128,528		10,032			138,560					4,590		9,209

Development
The Park at Chapel Hill ⁽⁴⁾		13,819		1,818			15,637		10.7	%		384		1,320
Total development		13,819		1,818			15,637					384		1,320

	$	166,169	$	11,846		$	178,015				$	5,299	$	11,176

Ground Lease - Development ⁽⁵⁾
Zoey	$	3,157		39			3,196		-		$	39	$	51
	$	3,157	$	39		$	3,196				$	39	$	51

⁽¹⁾

The property incurred an additional $143 of costs related to the sale of Helios.

⁽²⁾

Represents remaining net assets in the joint venture after receipt of $14.2 million in proceeds for the preferred equity investment.

⁽³⁾

The Company also holds an equity method investment with 0.5% common ownership.

⁽⁴⁾

The investment includes a $5.0 million senior loan and a $10.5 million mezzanine loan.

⁽⁵⁾

Ground lease investments are included in accounts receivable, prepaids and other assets.

Bluerock Residential Growth REIT, Inc.

Portfolio Information

Second Quarter 2020

(Unaudited)

Multifamily Community Name	Location	Number of Units		Year Built/ Renovated ⁽¹⁾	Average Rent ⁽²⁾			Revenue per Occupied Unit ⁽³⁾			Average Occupancy
Consolidated Operating Properties:
ARIUM Glenridge	Atlanta, GA		480	1990	$	1,279		$	1,378			92.3	%
ARIUM Grandewood	Orlando, FL		306	2005		1,437			1,511			94.8	%
ARIUM Hunter’s Creek	Orlando, FL		532	1999		1,444			1,502			95.3	%
ARIUM Metrowest	Orlando, FL		510	2001		1,451			1,568			95.5	%
ARIUM Westside	Atlanta, GA		336	2008		1,545			1,661			93.1	%
Ashford Belmar	Lakewood, CO		512	1988/1993		1,646			1,826			96.0	%
Avenue 25	Phoenix, AZ		254	2013		1,198			1,340			94.3	%
Cade Boca Raton	Boca Raton, FL		90	2019		2,851			2,620			93.5	%
Chattahoochee Ridge	Atlanta, GA		358	1996		1,355			1,411			92.1	%
Citrus Tower	Orlando, FL		336	2006		1,365			1,461			93.3	%
Denim	Scottsdale, AZ		645	1979		1,225			1,393			96.6	%
Element	Las Vegas, NV		200	1995		1,251			1,321			95.2	%
Falls at Forsyth	Cumming, GA		356	2019		1,370			1,507			85.4	%
Gulfshore Apartment Homes	Naples, FL		368	2016		1,295			1,269			93.2	%
James on South First	Austin, TX		250	2016		1,331			1,488			97.1	%
Marquis at The Cascades	Tyler, TX		582	2009		1,229			1,316			93.6	%
Navigator Villas	Pasco, WA		176	2013		1,096			1,311			96.3	%
Outlook at Greystone	Birmingham, AL		300	2007		1,038			1,200			95.9	%
Park & Kingston	Charlotte, NC		168	2015		1,327			1,419			93.6	%
Pine Lakes Preserve	Port St. Lucie, FL		320	2003		1,338			1,438			96.8	%
Plantation Park	Lake Jackson, TX		238	2016		1,315			1,430			93.6	%
Providence Trail	Mount Juliet, TN		334	2007		1,251			1,388			95.1	%
Roswell City Walk	Roswell, GA		320	2015		1,568			1,786			94.7	%
Sands Parc	Daytona Beach, FL		264	2017		1,375			1,551			92.0	%
The Brodie	Austin, TX		324	2001		1,319			1,477			96.1	%
The District at Scottsdale	Scottsdale, AZ		332	2018		1,864			1,929			68.0	%
The Links at Plum Creek	Castle Rock, CO		264	2000		1,424			1,557			96.7	%
The Mills	Greenville, SC		304	2013		1,049			1,181			93.1	%
The Preserve at Henderson Beach	Destin, FL		340	2009		1,482			1,619			96.6	%
The Reserve at Palmer Ranch	Sarasota, FL		320	2016		1,331			1,447			94.5	%
The Sanctuary	Las Vegas, NV		320	1988		1,059			1,063			95.9	%
Veranda at Centerfield	Houston, TX		400	1999		990			1,118			93.9	%
Villages of Cypress Creek	Houston, TX		384	2001		1,169			1,242			96.0	%
Wesley Village	Charlotte, NC		301	2010		1,363			1,448			94.4	%

Total Consolidated Operating Properties			11,524		$	1,329	⁽⁵⁾	$	1,441	⁽⁵⁾		94.5	%⁽⁵⁾

Mezzanine/Preferred/Ground Lease Investments:
Alexan CityCentre	Houston, TX		340		$	1,800		$	1,898			86.8	%
Alexan Southside Place	Houston, TX		270			1,716			1,854			93.1	%
Arlo	Charlotte, NC		286			1,507	⁽⁴⁾		N/A			N/A
Belmont Crossing	Smyrna, GA		192			772			778			96.3	%
Domain at The One Forty	Garland, TX		299			1,410			1,560			94.3	%
Georgetown Crossing	Savannah, GA		168			938			989			86.9	%
Mira Vista	Austin, TX		200			1,035			1,114			94.0	%
Motif	Fort Lauderdale, FL		385			2,352	⁽⁴⁾		N/A			N/A
North Creek Apartments	Leander, TX		259			1,358	⁽⁴⁾		N/A			N/A
Novel Perimeter	Atlanta, GA		320			1,749	⁽⁴⁾		N/A			N/A
Park on the Square	Pensacola, FL		240			1,067			1,172			93.5	%
Riverside Apartments	Austin, TX		222			1,408	⁽⁴⁾		N/A			N/A
Sierra Terrace	Atlanta, GA		135			1,192			1,289			98.0	%
Sierra Village	Atlanta, GA		154			1,091			1,115			95.9	%
The Commons	Jacksonville, FL		328			819			858			97.4	%
The Park at Chapel Hill	Chapel Hill, NC		*			*			N/A			N/A
Thornton Flats	Austin, TX		104			1,517			1,693			89.7	%
Vickers Historic Roswell	Roswell, GA		79			3,176	⁽⁴⁾		N/A			N/A
Wayforth at Concord	Concord, NC		150			1,707	⁽⁴⁾		N/A			N/A
Zoey	Austin, TX		307			1,762	⁽⁴⁾		N/A			N/A

Total Mezzanine/Preferred/Ground Lease Investments			4,438		$	1,512		$	1,350			92.4	%

Total Portfolio			15,962		$	1,380	⁽⁶⁾	$	1,426	⁽⁶⁾		94.1	%⁽⁶⁾

⁽¹⁾

Represents date of last significant renovation or year built if no renovations.

⁽²⁾

Represents the average effective monthly rent per occupied unit for the three months ended June 30, 2020.

⁽³⁾

Revenue per occupied unit is total revenue divided by average number of occupied units for the three months ended June 30, 2020.

⁽⁴⁾

Represents the average pro forma effective monthly rent per occupied unit for all expected units upon stabilization.

⁽⁵⁾

Excludes The District at Scottsdale, which is in lease-up. The average effective monthly rent, revenue per occupied unit, and average occupancy including sold properties was $1,330, $1,441, and 94.4%, respectively, for the three months ended June 30, 2020.

⁽⁶⁾

Excludes The District at Scottsdale, which is in lease-up. The average effective monthly rent, revenue per occupied unit, and average occupancy were not impacted by the sold properties for the three months ended June 30, 2020.

The development is in the planning phase; project specifications are in process.

Bluerock Residential Growth REIT, Inc.

Renovation Table

As of June 30, 2020

(Unaudited)

Units and Investment
	2020					To Date
	Completed		Completed		Total Expected	Total		Unrenovated Units
	in 2Q		Year-to-date		Completions in 2020	Completed		Remaining
Number of Renovations		39		159	200 - 400		2,804		4,572
Renovation Cost per Unit	$	7,349	$	8,183	$7,000 - $9,000

Returns
		Inception-to-date
		Cost		Monthly Rent	Return on
		per Unit		Premium	Investment
Weighted Average Returns to Date	$	5,834	$	114	23.5%

Bluerock Residential Growth REIT, Inc.

Lease-up and Development Mezzanine/Preferred/Ground Lease Investments

As of June 30, 2020

(Unaudited)

This table includes forward-looking statements based on current judgments and current knowledge of management, which are subject to certain risks, trends and uncertainties that could cause results to vary from those projected. Please see the paragraph on forward-looking statements on page 2 of this document for a discussion of risks and uncertainties.

											Actual/Estimated Dates for
Multifamily Community Name	Actual/ Planned Number of Units		Total Actual/ Estimated Construction Cost (in millions)		Cost to Date (in millions)		Actual/ Estimated Construction Cost Per Unit		Total Available Financing (in millions) ⁽¹⁾		Construction Start	Initial Occupancy	Construction Completion	Stabilized Operations ⁽²⁾
Lease-up Investments
Vickers Historic Roswell ⁽³⁾		79	$	31.9	$	30.3	$	403,797	$	22.0	2Q16	2Q18	3Q18	1Q21
Arlo ⁽³⁾		286		60.0		58.8		209,790		43.0	4Q16	2Q18	1Q19	3Q20
Novel Perimeter ⁽³⁾		320		71.0		68.3		221,875		42.7	4Q16	3Q18	1Q19	1Q21
Motif ⁽³⁾		385		135.4		129.9		351,688		70.4	1Q18	1Q20	2Q20	2Q22
North Creek Apartments ⁽⁴⁾		259		44.0		34.2		169,884		23.6	4Q18	2Q20	4Q20	3Q21
Wayforth at Concord ⁽⁴⁾		150		33.5		20.2		223,333		22.3	4Q18	1Q20	3Q21	3Q21
Total lease-up units		1,479

Development Investments
Riverside Apartments ⁽⁴⁾		222		37.9		20.3		170,721		20.2	2Q19	1Q21	2Q21	4Q21
Zoey		307		59.5		12.8		193,811		25.5	1Q20	1Q22	2Q22	1Q23
The Park at Chapel Hill ⁽⁵⁾		-		-		-		-		-	-	-	-	-
Total development units		529

Total units		2,008

⁽¹⁾

Represents property level only and excludes mezzanine loan financing.

⁽²⁾

We define stabilized occupancy as attainment of 90% physical occupancy.

⁽³⁾

Represents a mezzanine loan investment. Arlo and Vickers Historic Roswell have an option to purchase indirect property interest upon maturity.

⁽⁴⁾

Represents a preferred equity investment. North Creek Apartments, Riverside Apartments, and Wayforth at Concord have an option to purchase the property at stabilization.

⁽⁵⁾

The development is in the planning phase; project specifications are in process.

Bluerock Residential Growth REIT, Inc.

Condensed Consolidated Balance Sheets

Second Quarter 2020

(Unaudited and dollars in thousands except for share and per share data)

	June 30, 2020			December 31, 2019
ASSETS
Net Real Estate Investments
Land	$	267,589		$	268,244
Buildings and improvements		1,778,750			1,752,738
Furniture, fixtures and equipment		70,151			67,904
Total Gross Real Estate Investments		2,116,490			2,088,886
Accumulated depreciation		(158,896	)		(141,566	)
Total Net Real Estate Investments		1,957,594			1,947,320
Cash and cash equivalents		211,968			31,683
Restricted cash		29,732			19,085
Notes and accrued interest receivable from related parties		178,015			193,781
Due from affiliates		309			2,969
Accounts receivable, prepaids and other assets		20,440			16,317
Preferred equity investments and investments in unconsolidated real estate joint ventures		107,610			126,444
In-place lease intangible assets, net		584			3,098
Total Assets	$	2,506,252		$	2,340,697

LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY
Mortgages payable	$	1,405,046		$	1,425,257
Revolving credit facilities		130,500			18,000
Accounts payable		1,885			1,488
Other accrued liabilities		29,670			27,499
Due to affiliates		727			790
Distributions payable		14,498			13,541
Total Liabilities		1,582,326			1,486,575
8.250% Series A Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 10,875,000 shares authorized; 5,558,392 and 5,721,460 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		136,778			140,355
6.000% Series B Redeemable Preferred Stock, liquidation preference $1,000 per share, 1,225,000 shares authorized; 516,738 and 536,695 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		467,237			480,921
7.625% Series C Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,295,845 and 2,323,750 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		56,279			56,797
6.150% Series T Redeemable Preferred Stock, liquidation preference $25.00 per share, 32,000,000 shares authorized; 4,025,663 and 17,400 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		90,925			388
Equity
Stockholders’ Equity
Preferred stock, $0.01 par value, 197,900,000 shares authorized; no shares issued and outstanding		—			—
7.125% Series D Cumulative Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,774,338 and 2,850,602 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		66,867			68,705
Common stock - Class A, $0.01 par value, 747,509,582 shares authorized; 24,605,585 and 23,422,557 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		246			234
Common stock - Class C, $0.01 par value, 76,603 shares authorized; 76,603 shares issued and outstanding as of June 30, 2020 and December 31, 2019		1			1
Additional paid-in-capital		321,973			311,683
Distributions in excess of cumulative earnings		(262,455	)		(253,132	)
Total Stockholders’ Equity		126,632			127,491
Noncontrolling Interests
Operating Partnership units		20,130			19,331
Partially owned properties		25,945			28,839
Total Noncontrolling Interests		46,075			48,170
Total Equity		172,707			175,661
TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY	$	2,506,252		$	2,340,697

Bluerock Residential Growth REIT, Inc.

Consolidated Statements of Operations

For the Three and Six Months Ended June 30, 2020 and 2019

(Dollars in thousands)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Revenues
Rental and other property revenues	$	47,695		$	46,464		$	98,047		$	92,153
Interest income from related parties and ground leases		5,338			5,973			11,227			11,749
Total revenues		53,033			52,437			109,274			103,902
Expenses
Property operating		18,571			18,868			37,870			37,470
Property management fees		1,194			1,235			2,488			2,451
General and administrative		5,303			5,046			11,674			10,674
Acquisition and pursuit costs		423			70			1,691			128
Weather-related losses, net		—			291			—			291
Depreciation and amortization		20,067			16,226			40,990			33,454
Total expenses		45,558			41,736			94,713			84,468
Operating income		7,475			10,701			14,561			19,434
Other income (expense)
Other income		19			—			59			—
Preferred returns on unconsolidated real estate joint ventures		2,834			2,492			5,249			4,781
Gain on sale of real estate investments		57,843			—			58,096			—
Gain on sale of non-depreciable real estate investments		—			—			—			679
Loss on extinguishment of debt and debt modification costs		(13,985	)		—			(13,985	)		—
Interest expense, net		(13,859	)		(15,125	)		(28,774	)		(31,191	)
Total other income (expense)		32,852			(12,633	)		20,645			(25,731	)
Net income (loss)		40,327			(1,932	)		35,206			(6,297	)
Preferred stock dividends		(14,237	)		(11,019	)		(27,784	)		(21,403	)
Preferred stock accretion		(3,602	)		(2,316	)		(7,527	)		(4,203	)
Net income (loss) attributable to noncontrolling interests
Operating Partnership units		5,413			(3,887	)		(409	)		(7,938	)
Partially owned properties		1,985			(390	)		1,707			(882	)
Net income (loss) attributable to noncontrolling interests		7,398			(4,277	)		1,298			(8,820	)
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)

Net income (loss) per common share - Basic	$	0.61		$	(0.50	)	$	(0.09	)	$	(1.03	)

Net income (loss) per common share – Diluted	$	0.61		$	(0.50	)	$	(0.09	)	$	(1.03	)

Weighted average basic common shares outstanding		24,307,147			22,430,619			24,197,479			22,775,203
Weighted average diluted common shares outstanding		24,345,034			22,430,619			24,197,479			22,775,203

Bluerock Residential Growth REIT, Inc.

Reconciliation of Funds from Operations (FFO) and Core FFO (CFFO) Attributable to Common Stockholders and Unit Holders

For the Three and Six Months Ended June 30, 2020 and 2019

(Unaudited and dollars in thousands except for share and per share data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)
Add back: Net income (loss) attributable to Operating Partnership Units		5,413			(3,887	)		(409	)		(7,938	)
Net income (loss) attributable to common stockholders and unit holders		20,503			(14,877	)		(1,812	)		(31,021	)
Common stockholders and Operating Partnership Units pro-rata share of:
Real estate depreciation and amortization ⁽¹⁾		19,144			15,290			39,045			31,432
Gain on sale of real estate investments		(55,250	)		—			(55,360	)		—
FFO Attributable to Common Stockholders and Unit Holders		(15,603	)		413			(18,127	)		411
Common stockholders and Operating Partnership Units pro-rata share of:
Acquisition and pursuit costs		423			70			1,691			128
Non-cash interest expense		747			786			1,592			1,561
Unrealized (gain) loss on derivatives		(5	)		652			(30	)		2,287
Loss on extinguishment of debt and debt modification costs		13,590			—			13,590			—
Weather-related losses, net		—			249			—			249
Non-real estate depreciation and amortization		122			84			242			170
Gain on sale of non-depreciable real estate investments		—			—			—			(679	)
Shareholder activism		—			55			—			393
Non-recurring expense, net		43			—			3			—
Non-cash preferred returns on unconsolidated real estate joint ventures		—			(386	)		—			(598	)
Non-cash equity compensation		2,191			2,427			5,738			4,819
Preferred stock accretion		3,602			2,316			7,527			4,203
CFFO Attributable to Common Stockholders and Unit Holders	$	5,110		$	6,666		$	12,226		$	12,944

Per Share and Unit Information:
FFO Attributable to Common Stockholders and Unit Holders - diluted	$	(0.47	)	$	0.01		$	(0.55	)	$	0.01
CFFO Attributable to Common Stockholders and Unit Holders - diluted	$	0.15		$	0.22		$	0.37		$	0.42

Weighted average common shares and units outstanding - diluted		33,075,598			30,550,863			32,936,762			30,704,271

⁽¹⁾

Bluerock Residential Growth REIT, Inc.

Mortgages Payable Summary Information

As of June 30, 2020

(Unaudited and dollars in thousands)

Property	Outstanding Principal			Interest Rate			Fixed/ Floating	Maturity Date
ARIUM Glenridge	$	49,500			1.51	%	L + 1.33% subject to Cap ⁽¹⁾	September 1, 2025
ARIUM Grandewood		39,385			2.97	%	⁽²⁾	July 1, 2025
ARIUM Hunter’s Creek		71,533			3.65	%	Fixed	November 1, 2024
ARIUM Metrowest		64,559			4.43	%	Fixed	May 1, 2025
ARIUM Westside		52,150			3.68	%	Fixed	August 1, 2023
Ashford Belmar		100,675			4.53	%	Fixed	December 1, 2025
Avenue 25		36,566			4.18	%	Fixed	July 1, 2027
Cade Boca Raton		23,500			2.50	%	L + 1.50% subject to Cap ⁽¹⁾	January 1, 2025
Chattahoochee Ridge		45,338			3.25	%	Fixed	December 5, 2024
Citrus Tower		40,980			4.07	%	Fixed	October 1, 2024
Denim		91,634			3.32	%	Fixed	August 1, 2029
Element		29,260			3.63	%	Fixed	July 1, 2026
Fannie Facility Advance		13,936			2.77	%	L + 2.60% subject to Cap ⁽¹⁾	June 1, 2027
Gulfshore Apartment Homes		46,345			3.26	%	Fixed	September 1, 2029
James on South First		25,895			4.35	%	Fixed	January 1, 2024
Marquis at The Cascades I		31,976			1.79	%	L + 1.61% subject to Cap ⁽¹⁾	June 1, 2024
Marquis at The Cascades II		22,316			1.79	%	L + 1.61% subject to Cap ⁽¹⁾	June 1, 2024
Navigator Villas		20,515			4.56	%	Fixed	June 1, 2028
Outlook at Greystone		22,105			4.30	%	Fixed	June 1, 2025
Park & Kingston		19,600			3.32	%	Fixed	November 1, 2026
Pine Lakes Preserve		42,728			3.16	%	L + 2.98% subject to Cap ⁽¹⁾	July 1, 2030
Plantation Park		26,625			4.64	%	Fixed	July 1, 2028
Providence Trail		47,950			3.54	%	Fixed	July 1, 2026
Roswell City Walk		50,526			3.63	%	Fixed	December 1, 2026
The Brodie		33,878			3.71	%	Fixed	December 1, 2023
The District at Scottsdale		76,200			1.85	%	L + 1.60% ⁽¹⁾	June 11, 2021
The Links at Plum Creek		39,896			4.31	%	Fixed	October 1, 2025
The Mills		25,539			4.21	%	Fixed	January 1, 2025
The Preserve at Henderson Beach		48,490			3.26	%	Fixed	September 1, 2029
The Reserve at Palmer Ranch		41,298			4.41	%	Fixed	May 1, 2025
The Sanctuary		33,707			3.31	%	Fixed	August 1, 2029
Veranda at Centerfield		26,100			1.42	%	L + 1.25% subject to Cap ⁽¹⁾	July 26, 2023
Villages of Cypress Creek		33,520			2.73	%	L + 2.55% subject to Cap ⁽¹⁾	July 1, 2027
Wesley Village		39,776			4.25	%	Fixed	April 1, 2024
Total		1,414,001
Fair value adjustments		2,354
Deferred financing costs, net		(11,309	)
Total	$	1,405,046
Weighted Average Interest Rate		3.46	%

⁽¹⁾

In June 2020, one-month LIBOR in effect was 0.18%. LIBOR rate is subject to a rate cap.

⁽²⁾

The principal balance includes a $19.7 million advance at a fixed rate of 4.35% and a $19.7 million advance at a variable rate of 1.58% as of June 30, 2020.

Bluerock Residential Growth REIT, Inc.

Mortgages Payable Summary Information Continued

As of June 30, 2020

(Unaudited and dollars in thousands)

Mortgages Payable Maturity Schedules

Year	Fixed Rate			Floating Rate			Total			% of Total
2020	$	3,415		$	665		$	4,080			0.29	%
2021		8,673			78,040			86,713	⁽¹⁾		6.13	%
2022		11,620			3,704			15,324			1.08	%
2023		97,252			29,934			127,186			8.99	%
2024		221,701			53,906			275,607			19.49	%
Thereafter		731,892			173,199			905,091			64.02	%
	$	1,074,553		$	339,448		$	1,414,001			100.00	%
Fair Value Adjustments		2,354			-			2,354
Subtotal	$	1,076,907		$	339,448		$	1,416,355
Deferred Financing Costs, net		(8,029	)		(3,280	)		(11,309	)
Total	$	1,068,878		$	336,168		$	1,405,046

	Amounts		% of Total			Weighted Average Interest Rates			Weighted Average Maturities (years)

Secured Fixed Rate Debt	$	1,076,907		76.0	%		3.89	%		5.9
Secured Floating Rate Debt		339,448		24.0	%		2.08	%		4.7
Total/Average	$	1,416,355		100.0	%		3.46	%		5.6

⁽¹⁾

$76.2 million represents a loan in connection with The District at Scottsdale. The loan has a June 2021 maturity date and contains two (2) three-month extension options, subject to certain conditions.

Bluerock Residential Growth REIT, Inc.

Definitions of Non-GAAP Financial Measures

The foregoing supplemental financial data includes certain non-GAAP financial measures that we believe are helpful in understanding our business, as further described below. Our definition and calculation of these non-GAAP financial measures may differ from those of other REITs, and may, therefore, not be comparable.

Funds from Operations and Core Funds from Operations, Attributable to Common Stockholders and Unit Holders

We believe that funds from operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts (“NAREIT”), and core funds from operations (“CFFO”) are important non-GAAP supplemental measures of operating performance for a REIT.

FFO attributable to common stockholders and unit holders is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We consider FFO to be an appropriate supplemental measure of our operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. We define FFO, consistent with the NAREIT definition, as net income, computed in accordance with GAAP, excluding gains or losses on sales of depreciable real estate property, plus depreciation and amortization of real estate assets, plus impairment write-downs of depreciable real estate, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis.

CFFO makes certain adjustments to FFO, removing the effect of items that do not reflect ongoing property operations such as acquisition expenses, non-cash interest expense, unrealized gains or losses on derivatives, losses on extinguishment of debt and debt modification costs (includes prepayment penalties incurred and the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt), one-time weather-related costs, gains or losses on sales of non-depreciable real estate property, shareholder activism, stock compensation expense and preferred stock accretion. Commencing January 1, 2020, we did not deduct the accrued portion of the preferred income on our preferred equity investments from FFO to determine CFFO as the income is deemed fully collectible. The accrued portion of the preferred income totaled $0.4 million and $0.8 million for the three and six months ended June 30, 2020, respectively. We believe that CFFO is helpful to investors as a supplemental performance measure because it excludes the effects of certain items which can create significant earnings volatility, but which do not directly relate to our core recurring property operations. As a result, we believe that CFFO can help facilitate comparisons of operating performance between periods and provides a more meaningful predictor of future earnings potential.

We have acquired seven operating properties and made nine investments through preferred equity interests and ground lease investments and sold twelve operating properties subsequent to June 30, 2019. The results presented are not directly comparable and should not be considered an indication of our future operating performance (unaudited and dollars in thousands, except share and per share data).

Same Store Properties

Same store properties are conventional multifamily residential apartments which were owned and operational for the entire periods presented.

Bluerock Residential Growth REIT, Inc.

Definitions of Non-GAAP Financial Measures

(Unaudited and dollars in thousands)

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate ("EBITDAre")

NAREIT defines earnings before interest, taxes, depreciation and amortization for real estate ("EBITDAre") (September 2017 White Paper) as net income, computed in accordance with GAAP, before interest expense, income taxes, depreciation and amortization expense, and further adjusted for gains and losses from sales of depreciated operating properties, and impairment write-downs of depreciated operating properties.

The reconciliations of net income (loss) attributable to common stockholders to EBITDAre and Adjusted EBITDAre are presented in the table below:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)
Net income (loss) attributable to noncontrolling interests		7,398			(4,277	)		1,298			(8,820	)
Preferred stock dividends		14,237			11,019			27,784			21,403
Preferred stock accretion		3,602			2,316			7,527			4,203
Interest expense, net		13,859			15,125			28,774			31,191
Depreciation and amortization		20,020			16,142			40,899			33,284
Gain on sale of real estate investments		(57,843	)		—			(58,096	)		—
Loss on extinguishment of debt and debt modification costs		13,985			—			13,985			—
EBITDAre	$	30,348		$	29,335		$	60,768		$	58,178
Acquisition and pursuit costs		423			70			1,691			128
Non-real estate depreciation and amortization		122			84			242			170
Weather-related losses, net		—			291			—			291
Gain on sale of non-depreciable real estate investments		—			—			—			(679	)
Shareholder activism		—			55			—			393
Non-cash equity compensation		2,191			2,427			5,738			4,819
Non-recurring expense, net		43			—			3			—
Non-cash preferred returns on unconsolidated real estate joint ventures		—			(386	)		—			(598	)
Adjusted EBITDAre	$	33,127		$	31,876		$	68,442		$	62,702

Bluerock Residential Growth REIT, Inc.

Definitions of Non-GAAP Financial Measures

(Unaudited and dollars in thousands)

Property Net Operating Income ("Property NOI")

We have acquired seven operating properties and made nine investments through preferred equity interests and ground lease investments and sold twelve operating properties subsequent to June 30, 2019. Therefore, the results presented in the table below are not directly comparable and should not be considered an indication of our future operating performance.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2019			2020			2019
Net income (loss) attributable to common stockholders	$	15,090		$	(10,990	)	$	(1,403	)	$	(23,083	)
Add back: Net income (loss) attributable to Operating Partnership Units		5,413			(3,887	)		(409	)		(7,938	)
Net income (loss) attributable to common stockholders and unit holders		20,503			(14,877	)		(1,812	)		(31,021	)
Add common stockholders and Operating Partnership Units pro-rata share of:
Depreciation and amortization		19,144			15,290			39,045			31,432
Non-real estate depreciation and amortization		122			84			242			170
Non-cash interest expense		747			786			1,592			1,561
Unrealized (gain) loss on derivatives		(5	)		652			(30	)		2,287
Loss on extinguishment of debt and debt modification costs		13,590			—			13,590			—
Property management fees		1,135			1,170			2,367			2,318
Acquisition and pursuit costs		423			70			1,691			128
Corporate operating expenses		5,166			4,975			11,462			10,529
Weather-related losses, net		—			249			—			249
Preferred dividends		14,237			11,019			27,784			21,403
Preferred stock accretion		3,602			2,316			7,527			4,203
Less common stockholders and Operating Partnership Units pro-rata share of:
Non-recurring expense, net		(43	)		—			(3	)		—
Preferred returns on unconsolidated real estate joint ventures		2,834			2,492			5,408			4,781
Interest income from related parties and ground leases		5,338			5,973			11,227			11,749
Gain on sale of real estate investments		55,250			—			55,360			—
Gain on sale of non-depreciable real estate investments		—			—			—			679
Pro-rata share of properties’ income		15,285			13,269			31,466			26,050
Add:
Noncontrolling interest pro-rata share of partially owned property income		750			690			1,553			1,418
Total property income		16,035			13,959			33,019			27,468
Add:
Interest expense		13,089			13,637			27,158			27,215
Net operating income		29,124			27,596			60,177			54,683
Less:
Non-same store net operating income		7,908			6,135			17,138			11,982
Same store net operating income ⁽¹⁾	$	21,216		$	21,461		$	43,039		$	42,701

(1)

Same store portfolio for the three and six months ended June 30, 2020 consists of 24 properties, which represent 8,459 units.

Bluerock Residential Growth REIT, Inc. - FORM 8-K - EX-99.2 - EXHIBIT 99.2 - August 10, 2020

Attached files

Bluerock Residential Growth REIT, Inc. Reports