Maryland | 333-160748 | 27-0351641 | ||
(State or Other Jurisdiction | (Commission File Number) | (IRS Employer | ||
of Incorporation) | Identification No.) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Clarion Park Property |
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Report of Independent Auditors |
F-1 | |||
Statement of Revenues Over Certain Operating Expenses for Three Months Ended March
31, 2011 (unaudited) and the Year Ended December 31, 2010 |
F-2 | |||
Notes to Statement of Revenues Over Certain Operating Expenses for the Three Months
Ended March 31, 2011 (unaudited) and the Year Ended December 31, 2010 |
F-3 |
Steadfast Income REIT, Inc. |
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Summary of Unaudited Pro Forma Financial Statements |
F-5 | |||
Unaudited Pro Forma Balance Sheet as of March 31, 2011 |
F-6 | |||
Unaudited Pro Forma Statement of Operations for the Three Months Ended March 31, 2011 |
F-8 | |||
Unaudited Pro Forma Statement of Operations for the Year Ended December 31, 2010 |
F-10 |
F-1
Three Months | ||||||||
Ended | Fiscal Year Ended | |||||||
March 31, 2011 | December 31, 2010 | |||||||
(unaudited) | ||||||||
Revenues: |
||||||||
Rental income |
$ | 416,086 | $ | 1,628,500 | ||||
Tenant reimbursements and other |
4,480 | 29,302 | ||||||
Total revenues |
420,566 | 1,657,802 | ||||||
Expenses: |
||||||||
Operating, maintenance, and management |
167,690 | 775,865 | ||||||
Real estate taxes and insurance |
41,302 | 164,651 | ||||||
General and administrative expenses |
23,032 | 23,124 | ||||||
Total expenses |
232,024 | 963,640 | ||||||
Revenues over certain operating expenses |
$ | 188,542 | $ | 694,162 | ||||
F-2
F-3
F-4
F-5
Steadfast | ||||||||||||||||
Income REIT, | Pro Forma Adjustments | |||||||||||||||
Inc. Historical | Arbor Pointe | Clarion Park | ||||||||||||||
(a) | Property (b) | Property (c) | Pro Forma Total | |||||||||||||
Assets: |
||||||||||||||||
Real Estate: |
||||||||||||||||
Land |
$ | 758,600 | $ | 886,124 | (b) | $ | 1,467,735 | (c) | $ | 3,112,459 | ||||||
Building and improvements |
15,571,167 | 5,436,189 | (b) | 9,465,974 | (c) | 30,473,330 | ||||||||||
Tenant origination and absorption costs |
1,224,044 | 177,687 | (b) | 281,291 | (c) | 1,683,022 | ||||||||||
Total real estate, cost |
17,553,811 | 6,500,000 | 11,215,000 | 35,268,811 | ||||||||||||
Less accumulated depreciation and amortization |
(1,170,706 | ) | | | (1,170,706 | ) | ||||||||||
Total real estate, net |
16,383,105 | 6,500,000 | 11,215,000 | 34,098,105 | ||||||||||||
Cash and cash equivalents |
5,309,697 | (1,610,328 | )(b) | (2,403,746 | )(c) | 1,295,623 | ||||||||||
Rents and other receivables |
114,887 | 22,995 | (b) | | 137,882 | |||||||||||
Deferred financing costs and other assets, net |
185,406 | 349,295 | (b) | 363,627 | (c) | 898,328 | ||||||||||
Total assets |
$ | 21,993,095 | $ | 5,261,962 | $ | 9,174,881 | $ | 36,429,938 | ||||||||
Liabilities: |
||||||||||||||||
Accounts payable and accrued liabilities |
$ | 1,035,658 | 154,039 | (b) | 313,529 | (c) | 1,503,226 | |||||||||
Notes payable |
11,650,000 | 5,200,000 | (b) | 8,972,000 | (c) | 25,822,000 | ||||||||||
Distributions payable |
86,181 | | | 86,181 | ||||||||||||
Due to affiliates |
277,004 | | | 277,004 | ||||||||||||
Total liabilities |
13,048,843 | 5,354,039 | 9,285,529 | 27,688,411 | ||||||||||||
Commitments and Contingencies |
||||||||||||||||
Redeemable common stock |
110,038 | | | 110,038 | ||||||||||||
Equity |
||||||||||||||||
Stockholders equity: |
||||||||||||||||
Preferred stock, $0.01 par value per share;
100,000,000 shares authorized, no shares
issued and outstanding |
| | | | ||||||||||||
Common stock, $0.01 par value per share;
999,999,000 shares authorized,
1,536,002 share issued and outstanding
and 1,536,002 pro forma shares as of
March 31, 2011 |
15,360 | | | 15,360 | ||||||||||||
Convertible stock, $0.01 par value per share;
1,000 shares issued and outstanding as of
March 31, 2011 |
10 | | | 10 | ||||||||||||
Additional paid-in capital |
12,500,531 | | | 12,500,531 | ||||||||||||
Cumulative distributions and net losses |
(3,681,687 | ) | (92,077 | )(d) | (110,648 | )(e) | (3,884,412 | ) | ||||||||
Total stockholders equity |
8,834,214 | (92,077 | ) | (110,648 | ) | 8,631,489 | ||||||||||
Noncontrolling interest |
| | | | ||||||||||||
Total equity |
8,834,214 | (92,077 | ) | (110,648 | ) | 8,631,489 | ||||||||||
Total liabilities and equity |
$ | 21,993,095 | $ | 5,261,962 | $ | 9,174,881 | $ | 36,429,938 | ||||||||
F-6
(a) | Historical financial information as of March 31, 2011, derived from the Companys Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011. | |
(b) | Represents adjustments to the balance sheet of the Company to give effect to the acquisition of the Arbor Pointe Property and related cash, other assets and liabilities as if the acquisition had occurred on March 31, 2011. The purchase price of the Arbor Pointe Property, exclusive of closing, and other acquisition costs, was $6.5 million and was funded with proceeds from the Companys initial public and private offering and bank financing in the amount of $5.2 million. | |
(c) | Represents adjustments to the balance sheet of the Company to give effect to the acquisition of the Clarion Park Property and related cash, other assets and liabilities as if the acquisition had occurred on March 31, 2011. The purchase price of the Clarion Park Property, exclusive of closing, and other acquisition costs, was $11.2 million and was funded with proceeds from the Companys initial public and private offering and bank financing in the amount of $9.0 million. | |
(d) | Amount represents the acquisition related expenses incurred in connection with the acquisition of the Arbor Pointe property, not included in the historical results. | |
(e) | Amount represents the acquisition related expenses incurred in connection with the acquisition of the Clarion Park property, not included in the historical results. |
F-7
Steadfast Income | Pro Forma Adjustments | |||||||||||||||
REIT, Inc. | Arbor Pointe | Clarion Park | ||||||||||||||
Historical (a) | Property (b) | Property (b) | Pro Forma Total | |||||||||||||
Revenues: |
||||||||||||||||
Rental income |
$ | 769,892 | $ | 271,907 | (c) | $ | 416,086 | (c) | $ | 1,457,885 | ||||||
Tenant reimbursements and other |
111,540 | 10,809 | (d) | 4,480 | (d) | 126,829 | ||||||||||
Total revenues |
881,432 | 282,716 | 420,566 | 1,584,714 | ||||||||||||
Expenses: |
||||||||||||||||
Operating, maintenance and management |
357,897 | 137,675 | (e) | 142,277 | (e) | 637,849 | ||||||||||
Real estate taxes and insurance |
161,535 | 30,076 | (f) | 49,801 | (f) | 241,412 | ||||||||||
Fees to affiliates |
68,156 | 23,252 | (g) | 37,632 | (g) | 129,040 | ||||||||||
Depreciation and amortization |
630,134 | 53,680 | (h) | 93,314 | (h) | 777,128 | ||||||||||
Interest expense |
166,812 | 64,291 | (i) | 104,649 | (i) | 335,752 | ||||||||||
General and administrative expenses |
495,245 | 8,165 | (j) | 23,032 | (j) | 526,442 | ||||||||||
Other acquisition costs |
59,929 | (26,571) | (k) | (1,222) | (k) | 32,136 | ||||||||||
1,939,708 | 290,568 | 449,483 | 2,679,759 | |||||||||||||
Net loss |
(1,058,276 | ) | $ | (7,852 | ) | $ | (28,917 | ) | (1,095,045 | ) | ||||||
Net loss attributable to noncontrolling interest |
| | ||||||||||||||
Net loss attributable to common stockholders |
$ | (1,058,276 | ) | $ | (1,095,045 | ) | ||||||||||
Net loss per common share basic and diluted |
$ | (0.79 | ) | $ | (0.71 | ) | ||||||||||
Weighted-average number of common shares
outstanding, basic and diluted |
1,339,273 | 1,536,002 | (l) | |||||||||||||
F-8
(a) | Historical financial information for the three months ended March 31, 2011 derived from the Companys Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011. | |
(b) | Represents adjustments to historical operations of the Company to give effect to the acquisition of the Arbor Pointe Property and Clarion Park Property as if these assets had been acquired as of January 1, 2010. | |
(c) | Represents base rental income (not reflected in the historical statement of operations of the Company) for the three months ended March 31, 2011, based on the historical operations of the previous owners. | |
(d) | Represents operating cost reimbursements and other operating income from tenants (not reflected in the historical statement of operations of the Company) for the three months ended March 31, 2011, based on historical operations of the previous owners. | |
(e) | Represents operating, maintenance and management expenses, excluding property management fees of $14,137 and $25,413 for Arbor Pointe Property and the Clarion Park Property, respectively, (not reflected in the historical statement of operations of the Company) for the three months ended March 31, 2011, based on historical operations of the previous owners. | |
(f) | Represents real estate taxes and insurance expense incurred (not reflected in the historical statement of operations of the Company) for the three months ended March 31, 2011, based on management estimates. | |
(g) | Represents fees to affiliates (not reflected in the historical statement of operations of the Company) for the three months ended March 31, 2011 that would be due to affiliates had the Arbor Pointe Property and the Clarion Park Property been acquired on January 1, 2010. The pro forma total fees to affiliates for the three months ended March 31, 2011 are as follows: | |
* | Investment Management Fees: Investment management fees are payable to our Advisor based on an annual fee, payable monthly, of 0.80% of the acquisition cost of the Arbor Pointe Property and the Clarion Park Property, including acquisition fees and acquisition expenses, as defined in the Advisory Agreement. The investment management fees payable to Advisor attributable to the acquisition costs of the Arbor Pointe Property and the Clarion Park Property for the three months ended March 31, 2011 was $13,357 and $22,912, respectively; and | |
* | Property Management Fees: Property management fees are payable to the property manager based on 3.5% of the monthly gross revenues of the Arbor Pointe Property and the Clarion Park Property, as defined in the Property Management Agreements for each property. The property management fees payable to the property manager for the three months ended March 31, 2011 was $9,895 and $14,720, respectively. | |
(h) | Represents depreciation expense (not reflected in the historical statement of operations of the Company) for the three months ended March 31, 2011. Depreciation expense on a property is recognized using the straight-line method and a 27.5-year life. Depreciation expense on the purchase price of tenant improvements is recognized using the straight-line method over the life of the lease. Amortization expense on lease intangible costs is recognized using the straight-line method over the life of the lease. | |
(i) | Represents interest expense incurred on $5.2 million in debt related to the Arbor Pointe Property pursuant to a promissory note bearing interest at a rate of 4.86%, and interest expense incurred on $8.972 million in debt related to the Clarion Park Property pursuant to the promissory note bearing interest at a rate of 4.58%. | |
(j) | Represents general and administrative expenses (not reflected in the historical statement of operations of the Company) for the three months ended March 31, 2011 based on historical operations of the previous owners of the Arbor Pointe Property and the Clarion Park Property. | |
(k) | Represents adjustments made to acquisition costs for the three months ended March 31, 2011, in order to eliminate those amounts incurred by the Company that are included in the historical financial information for the three months ended March 31, 2011 that were attributable to the Arbor Pointe Property and the Clarion Park Property during the three months ended March 31, 2011, as if the assets had been acquired as of January 1, 2010. | |
(l) | Represents the actual number of shares of the Companys common stock outstanding as of March 31, 2011. The calculation assumes that these shares were issued and the related proceeds were raised as of January 1, 2010. |
F-9
Pro Forma Adjustments | ||||||||||||||||||||
Steadfast | 2010 | |||||||||||||||||||
Income REIT, Inc. | Acquisitions | Arbor Pointe | Clarion Park | Pro Forma | ||||||||||||||||
Historical (a) | (b) | Property (c) | Property (d) | Total | ||||||||||||||||
Revenues: |
||||||||||||||||||||
Rental income |
$ | 778,387 | $ | 2,309,937 | (e) | $ | 1,127,420 | (e) | $ | 1,628,500 | (e) | $ | 5,844,244 | |||||||
Tenant reimbursements and other |
49,843 | 278,038 | (f) | 30,389 | (f) | 29,302 | (f) | 387,572 | ||||||||||||
Total revenues |
828,230 | 2,587,975 | 1,157,809 | 1,657,802 | 6,231,816 | |||||||||||||||
Expenses: |
||||||||||||||||||||
Operating, maintenance and management |
297,251 | 823,816 | (g) | 472,303 | (g) | 550,900 | (g) | 2,144,270 | ||||||||||||
Real estate taxes and insurance |
138,181 | 492,790 | (h) | 120,304 | (h) | 198,255 | (h) | 949,530 | ||||||||||||
Fees to affiliates |
419,694 | 200,565 | (i) | 227,487 | (i) | 378,788 | (i) | 1,226,534 | ||||||||||||
Depreciation and amortization |
540,572 | 410,477 | (j) | 392,407 | (j) | 654,545 | (j) | 1,998,001 | ||||||||||||
Interest expense |
163,987 | 511,313 | (k) | 259,918 | (k) | 423,281 | (k) | 1,358,499 | ||||||||||||
General and administrative expenses |
1,108,220 | 260,962 | (l) | 44,309 | (l) | 23,124 | (l) | 1,436,615 | ||||||||||||
Other acquisition costs |
323,906 | 46,433 | (m) | 125,264 | (m) | 151,159 | (m) | 646,762 | ||||||||||||
2,991,811 | 2,746,356 | 1,641,992 | 2,380,052 | 9,760,211 | ||||||||||||||||
Net loss |
(2,163,581 | ) | $ | (158,381 | ) | $ | (484,183 | ) | $ | (722,250 | ) | (3,528,395 | ) | |||||||
Net loss attributable to noncontrolling interest |
1,000 | 1,000 | ||||||||||||||||||
Net loss attributable to common stockholders |
$ | (2,162,581 | ) | $ | (3,527,395 | ) | ||||||||||||||
Net loss per common share basic and diluted |
$ | (4.27 | ) | $ | (2.30 | ) | ||||||||||||||
Weighted-average number of common shares
outstanding, basic and diluted |
506,003 | 1,536,002 | (n) | |||||||||||||||||
F-10
(a) | Historical financial information derived from the Companys Annual Report on Form 10-K for the year ended December 31, 2010. | |
(b) | Represents adjustments to historical operations of the Company to give effect to the acquisition of the Lincoln Tower Property and the Park Place Property, which were acquired on August 22, 2010 and December 22, 2010, respectively, as if these assets had been acquired as of January 1, 2010. Detailed pro forma information for the Lincoln Tower Property and the Park Place Property is contained in the Companys prior filings with the Securities and Exchange Commission. | |
(c) | Represents adjustments to historical operations of the Company to give effect to the acquisition of the Arbor Pointe Property, which was acquired on May 5, 2011, as if this asset had been acquired as of January 1, 2010. | |
(d) | Represents adjustments to historical operations of the Company to give effect to the acquisition of the Clarion Park Property, which was acquired on June 28, 2011, as if this asset had been acquired as of January 1, 2010. | |
(e) | Represents the estimated base rental income (not reflected in the historical statement of operations of the Company) for the year ended December 31, 2010, based on the historical operations of the previous owners as if the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property had been acquired as of January 1, 2010. | |
(f) | Represents operating cost reimbursements and other operating income from tenants (not reflected in the historical statement of operations of the Company) for the year ended December 31, 2010, based on historical operations of the previous owners of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property. | |
(g) | Represents operating, maintenance and management expenses, excluding management fees of $99,965 and incentive management fees of $125,000 for the Clarion Park Property, (not reflected in the historical statement of operations of the Company) for the year ended December 31, 2010, based on historical operations of the previous owners of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property. | |
(h) | Represents real estate taxes and insurance expense incurred by the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property (not reflected in the historical statement of operations of the Company) for the year ended December 31, 2010, based on management estimates. | |
(i) | Represents fees to affiliates (not reflected in the historical statement of operations of the Company) for the year ended December 31, 2010 that would be due to affiliates had the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property been acquired on January 1, 2010. The pro forma total fees to affiliates are as follows: | |
* | Acquisition Fees: Acquisition fees are payable based on 2% of the sum of the acquisition cost of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property, including acquisition expenses (with the total acquisition fees and acquisition expenses payable to the Advisor being subject to a limitation of 6% of the contract purchase price), as defined in the Advisory Agreement (the Advisory Agreement by and among the Company, its operating partnership and the Companys advisor (the Advisor). The acquisition fee payable to Advisor attributable to the acquisitions of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property for the year ended December 31, 2010 was $192,858, $164,779, $133,545 and $229,118, respectively; | |
* | Investment Management Fees: Investment management fees are payable to our Advisor based on an annual fee, payable monthly, of 0.80% of the acquisition cost of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property, and the Clarion Park Property, including acquisition fees and acquisition expenses, as defined in the Advisory Agreement. The investment management fees payable to Advisor attributable to the acquisition costs of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property for the year ended December 31, 2010 was $77,143, $65,912, $53,419 and $91,647, respectively; and | |
* | Property Management Fees: Property management fees are payable to the property manager based on 3.5% of the monthly gross revenues of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property, as defined in the Property Management Agreements for each property. The property management fees payable to the property manager of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property for the year ended December 31, 2010 was $68,782, $50,785, $40,523 and $58,023, respectively. |
F-11
(j) | Represents depreciation expense (not reflected in the historical statement of operations of the Company) for the year ended December 31, 2010. Depreciation expense on a property is recognized using the straight-line method and a 27.5-year life. Depreciation expense on the purchase price of tenant improvements is recognized using the straight-line method over the life of the lease. Amortization expense on lease intangible costs is recognized using the straight-line method over the life of the lease. | |
(k) | Represents interest expense incurred on $6.7 million in seller financing from the seller of the Lincoln Tower Property pursuant to a promissory note bearing interest at a rate of 6%, interest expense incurred on $5.0 million in debt related to the Park Place Property pursuant to a promissory note bearing interest at a rate of 5.25%, interest expense incurred on $5.2 million in debt related to the Arbor Pointe Property pursuant to a promissory note bearing interest at a rate of 4.86%, and interest expense incurred on $9.0 million in debt related to the Clarion Park Property pursuant to a promissory note bearing interest at a rate of 4.58% | |
(l) | Represents general and administrative expenses (not reflected in the historical statement of operations of the Company) for the year ended December 31, 2010, based on historical operations of the previous owners of the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and the Clarion Park Property. | |
(m) | Represents adjustments made to acquisition costs for the year ended December 31, 2010, to include those amounts incurred by the Company that were attributable to the Lincoln Tower Property, the Park Place Property, the Arbor Pointe Property and Clarion Park Property, as if the assets had been acquired as of January 1, 2010. | |
(n) | Represents the actual number of shares of the Companys common stock outstanding as of March 31, 2011. The calculation assumes that these shares were issued and the related proceeds were raised as of January 1, 2010. |
F-12
STEADFAST INCOME REIT, INC. | ||||||
Date:
August 11, 2011
|
By: | /s/ Kevin J Keating
|
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Principal Financial and Accounting Officer |