QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction |
(I.R.S. Employer | |
of incorporation or organization) |
Identification No.) |
Title of Each Class |
Trading Symbol(s) |
Name of each Exchange on Which Registered | ||
“ “ |
Large accelerated filer | ☐ | ☒ | ||||
Non-accelerated filer |
☐ | Smaller reporting company | ||||
Emerging growth company |
3 | ||||
3 | ||||
3 | ||||
4 | ||||
5 | ||||
6 | ||||
8 | ||||
9 | ||||
19 | ||||
31 | ||||
31 | ||||
32 | ||||
32 | ||||
32 | ||||
33 | ||||
34 | ||||
34 | ||||
34 | ||||
35 | ||||
36 |
September 30, 2020 |
December 31, 2019 |
|||||||
Assets |
||||||||
Real estate properties |
||||||||
Land |
$ | $ | ||||||
Building and improvement |
||||||||
Tenant improvement |
||||||||
Furniture, fixtures and equipment |
||||||||
|
|
|
|
|||||
Accumulated depreciation |
( |
) | ( |
) | ||||
|
|
|
|
|||||
|
|
|
|
|||||
Cash and cash equivalents |
||||||||
Restricted cash |
||||||||
Rents receivable, net |
||||||||
Deferred leasing costs, net |
||||||||
Acquired lease intangible assets, net |
||||||||
Other assets |
||||||||
Assets held for sale |
— | |||||||
|
|
|
|
|||||
Total Assets |
$ | $ | ||||||
|
|
|
|
|||||
Liabilities and Equity |
||||||||
Liabilities: |
||||||||
Debt |
$ | $ | ||||||
Accounts payable and accrued liabilities |
||||||||
Deferred rent |
||||||||
Tenant rent deposits |
||||||||
Acquired lease intangible liabilities, net |
||||||||
Other liabilities |
||||||||
Liabilities related to assets held for sale |
— | |||||||
|
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|
|
|||||
Total Liabilities |
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|
|||||
Commitments and Contingencies (Note 9) |
||||||||
Equity: |
||||||||
|
||||||||
Common stock, $ |
||||||||
Additional paid-in capital |
||||||||
Accumulated deficit |
( |
) | ( |
) | ||||
Accumulated other comprehensive (loss)/income |
( |
) | ||||||
|
|
|
|
|||||
Total Stockholders’ Equity |
||||||||
Non-controlling interests in properties |
||||||||
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|
|
|||||
Total Equity |
||||||||
|
|
|
|
|||||
Total Liabilities and Equity |
$ | $ | ||||||
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2020 |
2019 |
2020 |
2019 |
|||||||||||||
Rental and other revenues |
$ | $ | $ | $ | ||||||||||||
Operating expenses: |
||||||||||||||||
Property operating expenses |
||||||||||||||||
General and administrative |
||||||||||||||||
Depreciation and amortization |
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|
|||||||||
Total operating expenses |
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|
|||||||||
Operating income |
||||||||||||||||
Interest expense: |
||||||||||||||||
Contractual interest expense |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
Amortization of deferred financing costs and debt fair value |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
( |
) | ( |
) | ( |
) | ( |
) | |||||||||
Net gain on sale of real estate property |
— | |||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income/(loss) |
( |
) | ( |
) | ||||||||||||
Less: |
||||||||||||||||
Net income attributable to non-controlling interests in properties |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income/(loss) attributable to the Company |
( |
) | ( |
) | ||||||||||||
Preferred stock distributions |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income/(loss) attributable to common stockholders |
$ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||
|
|
|
|
|
|
|
|
|||||||||
Net income/(loss) per common share: |
||||||||||||||||
Basic |
$ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||
|
|
|
|
|
|
|
|
|||||||||
Diluted |
$ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||
|
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|
|
|
|
|
|
|||||||||
Weighted average common shares outstanding: |
||||||||||||||||
Basic |
||||||||||||||||
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|
|||||||||
Diluted |
||||||||||||||||
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|
|||||||||
Dividend distributions declared per common share |
$ | $ | $ | $ | ||||||||||||
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2020 |
2019 |
2020 |
2019 |
|||||||||||||
Net income/(loss) |
$ | $ | ( |
) | $ | $ | ( |
) | ||||||||
Other comprehensive income/(loss): |
||||||||||||||||
Unrealized cash flow hedge (loss)/gain |
( |
) | ( |
) | ||||||||||||
Amounts reclassified to interest expense |
( |
) | ( |
) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive income/(loss) |
( |
) | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income/(loss) |
( |
) | ( |
) | ||||||||||||
Less: |
||||||||||||||||
Comprehensive income attributable to non-controlling interests in properties |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income/(loss) attributable to the Company |
( |
) | ( |
) | ||||||||||||
Preferred stock distributions |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive income/(loss) attributable to common stockholders |
$ | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||||
|
|
|
|
|
|
|
|
Number of shares of preferred stock |
Preferred stock |
Number of shares of common stock |
Common stock |
Additional paid-in capital |
Accumulated deficit |
Accumulated other comprehensive (loss)/income |
Total stockholders’ equity |
Non- controlling interests in properties |
Total equity |
|||||||||||||||||||||||||||||||
Balance—December 31, 2019 |
$ | $ | |
$ | $ | ( |
$ | $ | $ | $ | ||||||||||||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | — | ( |
— | — | ||||||||||||||||||||||||||||||||||
Common stock repurchased |
— | — | ( |
) | ( |
) | ( |
) | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
— | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
— | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Contributions |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive loss |
— | — | — | — | — | — | ( |
) | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance—March 31, 2020 |
$ | $ | $ | $ | ( |
$ | ( |
) | $ | $ | $ | |
||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | ( |
) | — | — | ||||||||||||||||||||||||||||||||||
Common stock repurchased |
— | — | ( |
) | ( |
) | ( |
) | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive loss |
— | — | — | — | — | — | ( |
) | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
|
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|
|
|
|
|
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|
|
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|
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|
|||||||||||||||||||||
Balance—June 30, 2020 |
$ | $ | $ | $ | ( |
$ | ( |
) | $ | $ | $ | |||||||||||||||||||||||||||||
|
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|
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|
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|
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|
|||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | — | ( |
) | — | — | |||||||||||||||||||||||||||||||||
Common stock repurchased |
— | — | ( |
) | ( |
) | ( |
) | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance—September 30, 2020 |
$ | $ | $ | $ | ( |
$ | ( |
$ | $ | $ | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares of preferred stock |
Preferred stock |
Number of shares of common stock |
Common stock |
Additional paid-in capital |
Accumulated deficit |
Accumulated other comprehensive (loss)/income |
Total stockholders’ equity |
Non- controlling interests in properties |
Total equity |
|||||||||||||||||||||||||||||||
Balance—December 31, 2018 |
$ | $ | |
$ | $ | ( |
$ | — | $ | $ | $ | |||||||||||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | ( |
— | — | |||||||||||||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
— | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
— | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Contributions |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | ( |
) | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance—March 31, 2019 |
$ | $ | $ | $ | ( |
$ | — | $ | $ | $ | ||||||||||||||||||||||||||||||
|
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|
|
|
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|
|||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | — | ( |
) | — | — | |||||||||||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Contributions |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
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|
|
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|
|
|
|
|||||||||||||||||||||
Balance—June 30, 2019 |
$ | $ | $ | $ | ( |
$ | — | $ | $ | $ | |
|||||||||||||||||||||||||||||
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|
|||||||||||||||||||||
Restricted stock award grants and vesting |
— | — | — | — | ( |
) | — | — | ||||||||||||||||||||||||||||||||
Net proceeds from sale of common stock |
— | — | — | — | — | |||||||||||||||||||||||||||||||||||
Common stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Preferred stock dividend distribution declared |
— | — | — | — | — | ( |
) | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Contributions |
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
Distributions |
— | — | — | — | — | — | — | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Net income |
— | — | — | — | — | ( |
) | — | ( |
) | ( |
) | ||||||||||||||||||||||||||||
Other comprehensive income |
— | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||
Balance—September 30, 2019 |
$ | $ | $ | $ | ( |
$ | $ | $ | $ | |
||||||||||||||||||||||||||||||
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|
Nine Months Ended September 30, |
||||||||
2020 |
2019 |
|||||||
Cash Flows from Operating Activities: |
||||||||
Net income/(loss) |
$ | $ | ( |
) | ||||
Adjustments to reconcile net income/(loss) to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
||||||||
Amortization of deferred financing costs and debt fair value |
||||||||
Amortization of above and below market leases |
( |
) | ( |
) | ||||
Straight-line rent/expense |
( |
) | ( |
) | ||||
Non-cash stock compensation |
||||||||
Net gain on sale of real estate property |
( |
) | ( |
) | ||||
Changes in non-cash working capital: |
||||||||
Rents receivable, net |
( |
) | ( |
) | ||||
Other assets |
( |
) | ( |
) | ||||
Accounts payable and accrued liabilities |
( |
) | ( |
) | ||||
Deferred rent |
( |
) | ||||||
Tenant rent deposits |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Net Cash Provided By Operating Activities |
||||||||
|
|
|
|
|||||
Cash Flows to Investing Activities: |
||||||||
Additions to real estate properties |
( |
) | ( |
) | ||||
Acquisition of real estate |
( |
) | ||||||
Net proceeds from sale of real estate. |
||||||||
Deferred leasing costs |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Net Cash Used In Investing Activities |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Cash Flows (to)/from Financing Activities: |
||||||||
Repurchases of common stock |
( |
) | — | |||||
Proceeds from sale of common stock |
||||||||
Debt issuance and extinguishment costs |
( |
) | ||||||
Proceeds from borrowings |
||||||||
Repayment of borrowings |
( |
) | ( |
) | ||||
Shares withheld for payment of taxes on restricted stock unit vesting |
( |
) | ( |
) | ||||
Contributions from non-controlling interests in properties . |
||||||||
Distributions to non-controlling interests in properties |
( |
) | ( |
) | ||||
Dividend distributions paid to stockholders |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Net Cash (Used In)/Provided By Financing Activities |
( |
) | ||||||
|
|
|
|
|||||
Net Decrease in Cash, Cash Equivalents and Restricted Cash |
( |
) | ( |
) | ||||
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
||||||||
|
|
|
|
|||||
Cash, Cash Equivalents and Restricted Cash, End of Period |
$ | $ | ||||||
|
|
|
|
|||||
Reconciliation of Cash, Cash Equivalents and Restricted Cash: |
||||||||
Cash and Cash Equivalents, End of Period |
||||||||
Restricted Cash, End of Period |
||||||||
|
|
|
|
|||||
Cash, Cash Equivalents and Restricted Cash, End of Period |
$ | $ | ||||||
|
|
|
|
|||||
Supplemental Disclosures of Cash Flow Information: |
||||||||
Cash paid for interest |
$ | $ | ||||||
Purchase of additions in real estate properties included in accounts payable |
$ | $ | ||||||
Purchase of deferred leasing costs included in accounts payable |
$ | $ | ||||||
Debt assumed on acquisition of real estate |
$ | $ |
Property |
Date Acquired |
Percentage Owned |
||||||
7601 Tech |
% | |||||||
Cascade Station |
% | |||||||
Canyon Park |
% |
Canyon Park |
Cascade Station |
7601 Tech |
Total Sept. 30, 2019 |
|||||||||||||
Land |
$ |
$ |
— |
$ |
$ |
|||||||||||
Building and improvement |
||||||||||||||||
Tenant improvement |
||||||||||||||||
Lease intangible assets |
||||||||||||||||
Other assets |
||||||||||||||||
Debt |
— |
( |
) |
— |
( |
) | ||||||||||
Accounts payable and other liabilities |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||
Lease intangible liabilities |
( |
) |
( |
) |
( |
) |
( |
) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net assets acquired |
$ |
$ |
$ |
$ |
||||||||||||
|
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|
|
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|
|
Circle Point Land |
December 31, 2019 |
|||
Real estate properties, net |
$ | |
||
|
|
|||
Assets held for sale |
$ | |||
|
|
|||
Accounts payable, accrued expenses, deferred rent and tenant rent deposits |
$ |
( |
) | |
|
|
|||
Liabilities related to assets held for sale |
$ | ( |
) | |
|
|
Lease Intangible Assets |
Lease Intangible Liabilities |
|||||||||||||||||||||||||||
September 30, 2020 |
Above Market Leases |
In Place Leases |
Leasing Commissions |
Total |
Below Market Leases |
Below Market Ground Lease |
Total |
|||||||||||||||||||||
Cost |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | |||||||||||||||
Accumulated amortization |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||||||||||||||
|
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|
|
|
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|
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$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | ||||||||||||||||
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Lease Intangible Assets |
Lease Intangible Liabilities |
|||||||||||||||||||||||||||
December 31, 2019 |
Above Market Leases |
In Place Leases |
Leasing Commissions |
Total |
Below Market Leases |
Below Market Ground Lease |
Total |
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Cost |
$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | |||||||||||||||
Accumulated amortization |
( |
) |
( |
) |
( |
) |
( |
) |
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$ |
$ |
$ |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) | ||||||||||||||||
|
|
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2020 |
$ | |||
2021 |
||||
2022 |
||||
2023 |
||||
2024 |
||||
Thereafter |
||||
|
|
|||
$ | ||||
|
|
Property |
September 30, 2020 |
December 31, 2019 |
Interest Rate as of September 30, 2020 (1) |
Maturity |
||||||||||||
Unsecured Credit Facility (3)(4) |
$ |
$ |
— |
% (2) |
||||||||||||
Term Loan (4) |
% (2) |
|||||||||||||||
Midland Life Insurance (5) |
% |
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Mission City |
% |
|||||||||||||||
Canyon Park (6) |
% |
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190 Office Center |
% |
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Circle Point |
% |
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SanTan |
% |
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Intellicenter |
% |
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The Quad |
% |
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FRP Collection |
% |
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2525 McKinnon |
% |
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Greenwood Blvd |
% |
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Cascade Station |
% |
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5090 N 40 th St |
% |
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AmberGlen |
% |
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Lake Vista Pointe |
% |
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Central Fairwinds |
% |
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FRP Ingenuity Drive |
% |
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Carillon Point |
% |
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|
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|
|||||||||||||
Total Principal |
||||||||||||||||
Deferred financing costs, net |
( |
) |
( |
) |
||||||||||||
Unamortized fair value adjustments |
||||||||||||||||
|
|
|
|
|||||||||||||
Total |
$ |
$ |
||||||||||||||
|
|
|
|
(1) |
All interest rates are fixed interest rates with the exception of the Unsecured Credit Facility (“Unsecured Credit Facility”) and the Term Loan (as defined herein), as explained in footnotes 3 and 4 below. |
(2) | As of September 30, 2020, the one-month LIBOR rate was |
(3) | In March 2018, the Company entered into the Credit Agreement for the Unsecured Credit Facility that provides for commitments of up to $ March and may be extended to at the Company’s option upon meeting certain conditions. Borrowings under the Unsecured Credit Facility bear interest at a rate equal to the LIBOR rate plus a margin of between |
(4) | In September 2019, the Company entered into a five-year $ 30-day LIBOR payments. |
(5) | The mortgage loan is cross-collateralized by Cherry Creek, City Center and 7595 Tech (formerly “DTC Crossroads”). |
(6) | The mortgage loan anticipated repayment date (“ARD”) is March 1, 2027. The final scheduled maturity date can be extended up to 5 years beyond the ARD. If the loan is not paid off at ARD, loan’s interest rate shall be adjusted to the greater of (i) the initial interest rate plus |
2020 |
$ | |||
2021 |
||||
2022 |
||||
2023 |
||||
2024 |
||||
Thereafter |
||||
|
|
|||
$ | ||||
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
2020 |
2019 |
2020 |
2019 |
|||||||||||||
Fixed payments |
$ |
$ | $ | $ | ||||||||||||
Variable payments |
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|
|||||||||
$ | $ | $ | $ | |||||||||||||
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|
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|
|
|
2020 |
$ | |||
2021 |
||||
2022 |
||||
2023 |
||||
2024 |
||||
Thereafter |
||||
|
|
|||
$ | ||||
|
|
September 30, 2020 |
December 31, 2019 |
|||||||
Right-of-use |
$ |
$ |
||||||
Lease liability – operating leases |
$ |
$ |
||||||
Right-of-use |
$ |
$ |
||||||
Lease liability – financing leases |
$ |
$ |
Operating Leases |
Financing Leases |
|||||||
2020 |
$ | $ | ||||||
2021 |
||||||||
2022 |
||||||||
2023 |
||||||||
2024 |
||||||||
Thereafter |
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|
|
|
|
|||||
Total future minimum lease payments |
||||||||
Discount |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Total |
$ | $ | ||||||
|
|
|
|
• | adverse economic or real estate developments in the office sector or the markets in which we operate; |
• | changes in local, regional, national and international economic conditions, including as a result of the ongoing COVID-19 pandemic; |
• | requests from tenants for rent deferrals, rent abatement or relief from other contractual obligations, or a failure to pay rent, as a result of changes in business behavior stemming from the ongoing COVID-19 pandemic or the availability of government assistance programs; |
• | our inability to compete effectively; |
• | our inability to collect rent from tenants or renew tenants’ leases on attractive terms if at all; |
• | demand for and market acceptance of our properties for rental purposes; |
• | defaults on or non-renewal of leases by tenants, including as a result of the ongoing COVID-19 pandemic; |
• | increased interest rates and any resulting increase in financing or operating costs; |
• | decreased rental rates or increased vacancy rates, including as a result of changes in business behavior or market dynamics related to the ongoing COVID-19 pandemic; |
• | our failure to obtain necessary financing or access the capital markets on favorable terms or at all; |
• | changes in the availability of acquisition opportunities; |
• | availability of qualified personnel; |
• | our inability to successfully complete real estate acquisitions or dispositions on the terms and timing we expect, or at all; |
• | our failure to successfully operate acquired properties and operations; |
• | changes in our business, financing or investment strategy or the markets in which we operate; |
• | our failure to generate sufficient cash flows to service our outstanding indebtedness; |
• | environmental uncertainties and risks related to adverse weather conditions and natural disasters; |
• | our failure to qualify and maintain our status as a real estate investment trust (“REIT”); |
• | government approvals, actions and initiatives, including the need for compliance with environmental requirements or actions in response to the COVID-19 pandemic; |
• | outcome of claims and litigation involving or affecting us; |
• | financial market fluctuations; |
• | changes in real estate, taxation and zoning laws and other legislation and government activity and changes to real property tax rates and the taxation of REITs in general; and |
• | other factors described in our news releases and filings with the Securities and Exchange Commission (the “SEC”), including but not limited to those described in our Annual Report on Form 10-K for the year ended December 31, 2019 under the heading “Risk Factors” and in our subsequent reports filed with the SEC. |
Metropolitan Area |
Property |
Economic Interest |
NRA (000s Square Feet) |
In Place Occupancy |
Annualized Base Rent per Square Foot |
Annualized Gross Rent per Square Foot (1) |
Annualized Base Rent (2) ($000s) |
|||||||||||||||||||
Phoenix, AZ |
Pima Center | 100.0 | % | 272 | 85.0 | % | $ | 27.58 | $ | 27.58 | $ | 6,371 | ||||||||||||||
SanTan |
100.0 | % | 267 | 93.1 | % | $ | 28.75 | $ | 28.75 | $ | 7,133 | |||||||||||||||
5090 N 40 th St |
100.0 | % | 175 | 95.8 | % | $ | 29.79 | $ | 29.79 | $ | 4,998 | |||||||||||||||
Camelback Square |
100.0 | % | 174 | 79.8 | % | $ | 29.50 | $ | 29.50 | $ | 4,098 | |||||||||||||||
The Quad |
100.0 | % | 163 | 100.0 | % | $ | 30.11 | $ | 30.43 | $ | 4,909 | |||||||||||||||
Papago Tech |
100.0 | % | 163 | 90.9 | % | $ | 22.63 | $ | 22.63 | $ | 3,347 | |||||||||||||||
Denver, CO |
Cherry Creek | 100.0 | % | 356 | 100.0 | % | $ | 18.95 | $ | 19.67 | $ | 6,740 | ||||||||||||||
Circle Point |
100.0 | % | 272 | 94.3 | % | $ | 18.16 | $ | 32.16 | $ | 4,658 | |||||||||||||||
Denver Tech (3) |
100.0 | % | 381 | 93.7 | % | $ | 23.02 | $ | 27.08 | $ | 8,213 | |||||||||||||||
Superior Pointe |
100.0 | % | 151 | 94.6 | % | $ | 18.16 | $ | 30.62 | $ | 2,600 | |||||||||||||||
Tampa, FL |
Park Tower | 94.8 | % | 471 | 88.3 | % | $ | 26.47 | $ | 26.47 | $ | 11,015 | ||||||||||||||
City Center |
95.0 | % | 242 | 90.3 | % | $ | 26.26 | $ | 26.26 | $ | 5,748 | |||||||||||||||
Intellicenter |
100.0 | % | 204 | 100.0 | % | $ | 24.53 | $ | 24.53 | $ | 4,993 | |||||||||||||||
Carillon Point |
100.0 | % | 124 | 100.0 | % | $ | 28.77 | $ | 28.77 | $ | 3,572 | |||||||||||||||
Orlando, FL |
Florida Research Park (4) |
96.6 | % | 397 | 98.5 | % | $ | 23.44 | $ | 26.87 | $ | 9,147 | ||||||||||||||
Central Fairwinds |
97.0 | % | 168 | 90.5 | % | $ | 26.20 | $ | 26.20 | $ | 3,990 | |||||||||||||||
Greenwood Blvd |
100.0 | % | 155 | 100.0 | % | $ | 23.25 | $ | 23.25 | $ | 3,605 | |||||||||||||||
San Diego, CA |
Sorrento Mesa | 100.0 | % | 296 | 85.3 | % | $ | 26.02 | $ | 34.02 | $ | 6,570 | ||||||||||||||
Mission City |
100.0 | % | 281 | 91.1 | % | $ | 36.35 | $ | 36.35 | $ | 9,316 | |||||||||||||||
Dallas, TX |
190 Office Center | 100.0 | % | 303 | 81.2 | % | $ | 25.65 | $ | 25.65 | $ | 6,313 | ||||||||||||||
Lake Vista Pointe |
100.0 | % | 163 | 100.0 | % | $ | 16.50 | $ | 25.50 | $ | 2,695 | |||||||||||||||
2525 McKinnon |
100.0 | % | 111 | 91.6 | % | $ | 28.60 | $ | 45.60 | $ | 2,918 | |||||||||||||||
Portland, OR |
AmberGlen | 76.0 | % | 203 | 98.4 | % | $ | 22.01 | $ | 24.55 | $ | 4,388 | ||||||||||||||
Cascade Station |
100.0 | % | 128 | 100.0 | % | $ | 27.12 | $ | 28.49 | $ | 3,457 | |||||||||||||||
Seattle, WA |
Canyon Park | 100.0 | % | 207 | 100.0 | % | $ | 21.84 | $ | 29.84 | $ | 4,515 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total / Weighted Average – September 30, 2020 (5) |
|
5,827 |
93.1 |
% |
$ |
24.95 |
$ |
27.91 |
$ |
135,309 |
||||||||||||||||
|
|
|
|
(1) | Annualized gross rent per square foot includes adjustment for estimated expense reimbursements of triple net leases for the year ended September 30, 2020. |
(2) | Annualized base rent is calculated by multiplying (i) rental payments (defined as cash rents before abatements) for the month ended September 30, 2020 by (ii) 12. |
(3) | Denver Tech is comprised of 7601 Tech and 7595 Tech (formerly “DTC Crossroads”). |
(4) | Florida Research Park is comprised of FRP Collection and FRP Ingenuity Drive. |
(5) | Averages weighted based on the property’s NRA, adjusted for occupancy. |
Payments Due by Period |
||||||||||||||||||||
Contractual Obligations |
Total |
2020 |
2021-2022 |
2023-2024 |
More than 5 years |
|||||||||||||||
Principal payments on mortgage loans |
$ | 682,585 | $ | 1,571 | $ | 170,885 | $ | 173,254 | $ | 336,875 | ||||||||||
Interest payments (1) |
119,184 | 6,425 | 44,222 | 37,089 | 31,448 | |||||||||||||||
Tenant-related commitments |
7,467 | 2,310 | 5,157 | — | — | |||||||||||||||
Lease obligations |
29,665 | 52 | 1,669 | 1,264 | 26,680 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total |
$ | 838,901 | $ | 10,358 | $ | 221,933 | $ | 211,607 | $ | 395,003 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | Contracted interest on the floating rate borrowings under our Unsecured Credit Facility was calculated based on the balance and interest rate at September 30, 2020. Contracted interest on the Term Loan was calculated based on the Interest Rate Swap rate fixing the LIBOR component of the borrowing rate to approximately 1.27%. |
• | a complete or partial closure of, decline or cessation in the usage of, or other operational issues at, one or more of our properties resulting from government or tenant action; |
|
• | the reduced economic activity severely impacts our tenants’ businesses, financial condition, liquidity and creditworthiness, which may cause one or more of our tenants to be unable to meet their obligations to us in full, or at all, seek modifications of such obligations or exercise early termination rights; |
• | a decrease in the usage of our properties or the demand for office space, or the Company’s ability to maintain or increase rents, which may have an adverse effect on our financial condition, results of operations and cash flow than if we owned a more diversified real estate portfolio; |
• | difficulty accessing sources of capital on attractive terms, or at all, impacts to our credit ratings, and a severe disruption and instability in the global financial markets or deteriorations in credit and financing conditions may affect our access to debt or equity capital necessary to fund future capital needs (including redevelopment, acquisition, expansion and renovation activities, payments of principal and interest on and the refinancing of our existing debt, tenant improvements and leasing costs) or refinancings on a timely basis and our tenants’ ability to fund their business operations and meet their obligations to us; |
• | the financial impact of the COVID-19 pandemic could negatively impact our future compliance with financial covenants of our Unsecured Credit Facility, including the Term Loan, and other debt agreements and result in a default and potentially an acceleration of indebtedness, which non-compliance could negatively impact our ability to make additional borrowings and pay dividends on our common stock or preferred stock; |
• | any impairment in value of our tangible or intangible assets which could be recorded as a result of a weaker economic conditions; |
• | a general decline in business activity and demand for real estate transactions could adversely affect our ability or desire to grow our portfolio of properties due to a lack of suitable acquisition opportunities; |
• | a general decline in the attractiveness of our properties due to changes in the demand for office space, which may adversely impact our ability to consummate pending or future dispositions on terms that allow us to recover expected carrying values of a real estate investment; and |
• | the potential negative impact on the health of a significant number of our employees could result in a deterioration in our ability to ensure business continuity or maintain adequate disclosure reporting or internal controls through the duration of this disruption. |
Issuer Purchases of Equity Securities |
||||||||||||||||
Period |
Total Number of Shares of Common Stock Purchased |
Average Price Paid per Share of Common Stock Repurchased |
Total Number of Shares of Common Stock Purchased as Part of Share Repurchase Plans |
Approximate Dollar Value of Shares of Common Stock that May Yet Be Purchased Under the Share Repurchase Plans (1) (thousands) |
||||||||||||
July 1 – 31, 2020 |
1,114,196 | $ | 9.58 | 1,114,196 | $ | — | ||||||||||
August 1 – 31, 2020 |
— | — | — | 50,000 | ||||||||||||
September 1 – 30, 2020 |
— | — | — | 50,000 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total |
1,114,196 | $ | 9.58 | 1,114,196 | $ | 50,000 | ||||||||||
|
|
|
|
|
|
|
|
(1) | Represents approximate dollar value of shares that could have been purchased under the plans in effect at the end of the month. |
By: | /s/ James Farrar | |
James Farrar | ||
Chief Executive Officer and Director | ||
(Principal Executive Officer) |
By: | /s/ Anthony Maretic | |
Anthony Maretic | ||
Chief Financial Officer, Secretary and Treasurer | ||
(Principal Financial Officer and Principal Accounting Officer) |