UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 2, 2018
Paramount Group, Inc.
(Exact Name of Registrant as Specified in Charter)
Maryland | 001-36746 | 32-0439307 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
1633 Broadway, Suite 1801 New York, New York |
10019 | |
(Address of Principal Executive offices) | (Zip Code) |
Registrants telephone number, including area code: (212) 237-3100
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2.):
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging Growth Company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On May 2, 2018, Paramount Group, Inc. (the Company) issued a press release announcing its financial results for the first quarter ended March 31, 2018. A copy of that press release as well as the supplemental information referred to in the press release are available on the Companys website and are attached hereto as Exhibits 99.1 and 99.2 and incorporated herein by reference. This Item 2.02 and the attached Exhibits 99.1 and 99.2 are being furnished and shall not be deemed filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.
The Company will host a conference call and audio webcast on Thursday, May 3, 2018 at 10:00 a.m. Eastern Time (ET), during which management will discuss the first quarter results and provide commentary on business performance. A question and answer session with analysts and investors will follow the prepared remarks.
The conference call can be accessed by dialing 877-407-0789 (domestic) or 201-689-8562 (international). An audio replay of the conference call will be available from 1:00 p.m. ET on May 3, 2018 through May 10, 2018 and can be accessed by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the passcode 13678478.
A live audio webcast of the conference call will be available through the Investors section of the Companys website, www.paramount-group.com. A replay of the webcast will be archived on the Companys website.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits:
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
PARAMOUNT GROUP, INC. | ||
By: | /s/ Wilbur Paes | |
Name: | Wilbur Paes | |
Title: | Executive Vice President, Chief Financial Officer and Treasurer |
Date: May 2, 2018
Exhibit 99.1
Paramount Announces First Quarter 2018 Results
NEW YORKMay 2, 2018 Paramount Group, Inc. (NYSE: PGRE) (Paramount or the Company) filed its Quarterly Report on Form 10-Q for the quarter ended March 31, 2018 today and reported results for the quarter ended March 31, 2018.
First Quarter Highlights:
| Reported net income attributable to common stockholders of $1.1 million, or $0.00 per diluted share, for the quarter ended March 31, 2018, compared to $0.4 million, or $0.00 per diluted share, for the quarter ended March 31, 2017. |
| Reported Core Funds from Operations (Core FFO) attributable to common stockholders of $55.0 million, or $0.23 per diluted share, for the quarter ended March 31, 2018, compared to $51.5 million, or $0.22 per diluted share, for the quarter ended March 31, 2017. |
| Reported a 15.2% increase in Same Store Cash Net Operating Income (NOI) and a 6.6% increase in Same Store NOI in the quarter ended March 31, 2018, compared to the same period in the prior year. |
| Leased 285,167 square feet, of which the Companys share was 216,848 square feet that was leased at a weighted average initial rent of $86.32 per square foot. Of the square footage leased, 161,215 square feet represented second generation space, for which the Company achieved a positive mark-to-market of 17.8% on a cash basis and 12.9% on a GAAP basis. |
| Increased leased occupancy and same store leased occupancy by 50 basis points to 94.0% at March 31, 2018 from 93.5% at December 31, 2017. |
| Amended its revolving credit facility, on January 10, 2018, to extend the maturity date from November 2018 to January 2022, with two six-month extension options and increase the capacity to $1.0 billion from $800.0 million. The interest rate on the extended facility, at current leverage levels, was lowered by 10 basis points from LIBOR plus 125 basis points to LIBOR plus 115 basis points, and the facility fee was reduced by 5 basis points from 25 basis points to 20 basis points. |
| Increased the quarterly cash dividend on its common stock by 5.3% on March 15, 2018 to $0.10 per common share, which was paid on April 13, 2018. |
1
Financial Results
Quarter Ended March 31, 2018
Net income attributable to common stockholders was $1.1 million, or $0.00 per diluted share, for the quarter ended March 31, 2018, compared to $0.4 million, or $0.00 per diluted share, for the quarter ended March 31, 2017.
Funds from Operations (FFO) attributable to common stockholders was $53.7 million, or $0.22 per diluted share, for the quarter ended March 31, 2018, compared to $51.6 million, or $0.22 per diluted share, for the quarter ended March 31, 2017. FFO attributable to common stockholders for the quarters ended March 31, 2018 and 2017 includes the impact of non-core items, which are listed in the table on page 8. The aggregate of these items, net of amounts attributable to noncontrolling interests, decreased FFO attributable to common stockholders for the quarter ended March 31, 2018 by $1.3 million, or $0.01 per diluted share, and increased FFO attributable to common stockholders for the quarter ended March 31, 2017 by $0.1 million, or $0.00 per diluted share.
Core FFO attributable to common stockholders, which excludes the impact of the non-core items listed on page 8, was $55.0 million, or $0.23 per diluted share, for the quarter ended March 31, 2018, compared to $51.5 million, or $0.22 per diluted share, for the quarter ended March 31, 2017.
Portfolio Operations
Quarter Ended March 31, 2018
Same Store Cash NOI increased by $11.0 million, or 15.2%, to $83.8 million for the quarter ended March 31, 2018 from $72.8 million for the quarter ended March 31, 2017. Same Store NOI increased by $6.1 million, or 6.6%, to $98.1 million for the quarter ended March 31, 2018 from $92.0 million for the quarter ended March 31, 2017.
During the quarter ended March 31, 2018, the Company leased 285,167 square feet, of which the Companys share was 216,848 square feet that was leased at a weighted average initial rent of $86.32 per square foot. This leasing activity, partially offset by lease expirations in the quarter, increased leased occupancy and same store leased occupancy (properties owned by the company in both reporting periods) by 50 basis points to 94.0% at March 31, 2018 from 93.5% at December 31, 2017. Of the 285,167 square feet leased in the first quarter, 161,215 square feet represented second generation space (space that had been vacant for less than twelve months) for which the Company achieved positive mark-to-markets of 17.8% on a cash basis and 12.9% on a GAAP basis. The weighted average lease term for leases signed during the first quarter was 8.3 years and weighted average tenant improvements and leasing commissions on these leases were $7.88 per square foot per annum, or 9.1% of initial rent.
2
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Federal securities laws. You can identify these statements by our use of the words assumes, believes, estimates, expects, guidance, intends, plans, projects and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Companys control and could materially affect actual results, performance or achievements. These factors include, without limitation, the ability to enter into new leases or renew leases on favorable terms, dependence on tenants financial condition, the uncertainties of real estate development, acquisition and disposition activity, the ability to effectively integrate acquisitions, the costs and availability of financing, the ability of our joint venture partners to satisfy their obligations, the effects of local, national and international economic and market conditions, the effects of acquisitions, dispositions and possible impairment charges on our operating results, regulatory changes, including changes to tax laws and regulations, and other risks and uncertainties detailed from time to time in the Companys filings with the Securities and Exchange Commission. The Company does not undertake a duty to update or revise any forward- looking statement, whether as a result of new information, future events or otherwise.
3
Non-GAAP Financial Measures
FFO is a supplemental measure of our performance. We present FFO in accordance with the definition adopted by the National Association of Real Estate Investment Trusts (Nareit). Nareit defines FFO as GAAP net income or loss adjusted to exclude net gains from sales of depreciated real estate assets, impairment losses on depreciable real estate and depreciation and amortization expense from real estate assets, including our share of such adjustments of unconsolidated joint ventures. FFO is commonly used in the real estate industry to assist investors and analysts in comparing results of real estate companies because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. In addition, we present Core FFO as an alternative measure of our operating performance, which adjusts FFO for certain other items that we believe enhance the comparability of our FFO across periods. Core FFO, when applicable, excludes the impact of certain items, including, transaction related costs, realized and unrealized gains or losses on real estate fund investments, unrealized gains or losses on interest rate swaps, severance costs and gains or losses on early extinguishment of debt, in order to reflect the Core FFO of our real estate portfolio and operations. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.
FFO and Core FFO are presented as supplemental financial measures and do not fully represent our operating performance. Other REITs may use different methodologies for calculating FFO and Core FFO or use other definitions of FFO and Core FFO and, accordingly, our presentation of these measures may not be comparable to other real estate companies. Neither FFO nor Core FFO is intended to be a measure of cash flow or liquidity. Please refer to our financial statements, prepared in accordance with GAAP, for purposes of evaluating our financial condition, results of operations and cash flows.
NOI is used to measure the operating performance of our properties. NOI consists of property-related revenue (which includes rental income, tenant reimbursement income and certain other income) less operating expenses (which includes building expenses such as cleaning, security, repairs and maintenance, utilities, property administration and real estate taxes). We also present Cash NOI which deducts from NOI, straight-line rent adjustments and the amortization of above and below-market leases, net, including our share of such adjustments of unconsolidated joint ventures. In addition, we present PGREs share of NOI and Cash NOI which represents our share of NOI and Cash NOI of consolidated and unconsolidated joint ventures, based on our percentage ownership in the underlying assets. We use NOI and Cash NOI internally as performance measures and believe they provide useful information to investors regarding our financial condition and results of operations because they reflect only those income and expense items that are incurred at property level.
Same Store NOI is used to measure the operating performance of properties that were owned by us in a similar manner during both the current period and prior reporting periods and represents Same Store NOI from consolidated and unconsolidated joint ventures based on our percentage ownership in the underlying assets. Same Store NOI also excludes lease termination income, bad debt expense and certain other items that may vary from period to period. We also present Same Store Cash NOI, which excludes the effect of non-cash items such as the straight-lining of rental revenue and the amortization of above and below-market leases.
A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure can be found in this press release and in our Supplemental Information for the quarter ended March 31, 2018, which is available on our website.
4
Investor Conference Call and Webcast
The Company will host a conference call and audio webcast on Thursday, May 3, 2018 at 10:00 a.m. Eastern Time (ET), during which management will discuss the first quarter results and provide commentary on business performance. A question and answer session with analysts and investors will follow the prepared remarks.
The conference call can be accessed by dialing 877-407-0789 (domestic) or 201-689-8562 (international). An audio replay of the conference call will be available from 1:00 p.m. ET on May 3, 2018 through May 10, 2018 and can be accessed by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the passcode 13678478.
A live audio webcast of the conference call will be available through the Investors section of the Companys website, www.paramount-group.com. A replay of the webcast will be archived on the Companys website.
About Paramount Group, Inc.
Headquartered in New York City, Paramount Group, Inc. is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York City, Washington, D.C. and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.
Contact Information:
Wilbur Paes Executive Vice President, Chief Financial Officer 212-237-3122 ir@paramount-group.com |
Christopher Brandt Vice President, Investor Relations 212-237-3134 ir@paramount-group.com |
Media:
212-492-2285
pr@paramount-group.com
5
Paramount Group, Inc.
Consolidated Balance Sheets
(Unaudited and in thousands)
March 31, 2018 | December 31, 2017 | |||||||
ASSETS: |
||||||||
Real estate, at cost |
||||||||
Land |
$ | 2,209,506 | $ | 2,209,506 | ||||
Buildings and improvements |
6,150,115 | 6,119,969 | ||||||
|
|
|
|
|||||
8,359,621 | 8,329,475 | |||||||
Accumulated depreciation and amortization |
(534,934 | ) | (487,945 | ) | ||||
|
|
|
|
|||||
Real estate, net |
7,824,687 | 7,841,530 | ||||||
Cash and cash equivalents |
212,547 | 219,381 | ||||||
Restricted cash |
33,032 | 31,044 | ||||||
Investments in unconsolidated joint ventures |
67,355 | 44,762 | ||||||
Investments in unconsolidated real estate funds |
7,276 | 7,253 | ||||||
Preferred equity investments, net |
35,870 | 35,817 | ||||||
Marketable securities |
24,984 | 29,039 | ||||||
Accounts and other receivables, net |
17,036 | 17,082 | ||||||
Deferred rent receivable |
234,758 | 220,826 | ||||||
Deferred charges, net |
106,415 | 98,645 | ||||||
Intangible assets, net |
333,983 | 352,206 | ||||||
Other assets |
75,925 | 20,076 | ||||||
|
|
|
|
|||||
Total assets |
$ | 8,973,868 | $ | 8,917,661 | ||||
|
|
|
|
|||||
LIABILITIES: |
||||||||
Notes and mortgages payable, net |
$ | 3,560,230 | $ | 3,541,300 | ||||
Revolving credit facility |
| | ||||||
Due to affiliates |
27,299 | 27,299 | ||||||
Accounts payable and accrued expenses |
128,625 | 117,630 | ||||||
Dividends and distributions payable |
26,627 | 25,211 | ||||||
Intangible liabilities, net |
122,673 | 130,028 | ||||||
Other liabilities |
54,344 | 54,109 | ||||||
|
|
|
|
|||||
Total liabilities |
3,919,798 | 3,895,577 | ||||||
|
|
|
|
|||||
EQUITY: |
||||||||
Paramount Group, Inc. equity |
4,162,439 | 4,176,741 | ||||||
Noncontrolling interests in: |
||||||||
Consolidated joint ventures |
404,137 | 404,997 | ||||||
Consolidated real estate fund |
51,456 | 14,549 | ||||||
Operating Partnership |
436,038 | 425,797 | ||||||
|
|
|
|
|||||
Total equity |
5,054,070 | 5,022,084 | ||||||
|
|
|
|
|||||
Total liabilities and equity |
$ | 8,973,868 | $ | 8,917,661 | ||||
|
|
|
|
6
Paramount Group, Inc.
Consolidated Statements of Income
(Unaudited and in thousands, except share and per share amounts)
For the Three Months Ended March 31, |
||||||||
2018 | 2017 | |||||||
REVENUES: |
||||||||
Property rentals |
$ | 145,741 | $ | 132,235 | ||||
Straight-line rent adjustments |
13,244 | 20,147 | ||||||
Amortization of above and below-market leases, net |
4,420 | 3,008 | ||||||
|
|
|
|
|||||
Rental income |
163,405 | 155,390 | ||||||
Tenant reimbursement income |
14,246 | 12,852 | ||||||
Fee and other income |
6,620 | 12,994 | ||||||
|
|
|
|
|||||
Total revenues |
184,271 | 181,236 | ||||||
EXPENSES: |
||||||||
Operating |
68,978 | 65,971 | ||||||
Depreciation and amortization |
65,156 | 62,992 | ||||||
General and administrative |
12,631 | 13,581 | ||||||
Transaction related costs |
120 | 275 | ||||||
|
|
|
|
|||||
Total expenses |
146,885 | 142,819 | ||||||
|
|
|
|
|||||
Operating income |
37,386 | 38,417 | ||||||
(Loss) income from unconsolidated joint ventures |
(62 | ) | 1,937 | |||||
(Loss) income from unconsolidated real estate funds |
(66 | ) | 288 | |||||
Interest and other income, net |
2,016 | 3,200 | ||||||
Interest and debt expense |
(36,082 | ) | (37,018 | ) | ||||
Loss on early extinguishment of debt |
| (2,715 | ) | |||||
Unrealized gain on interest rate swaps |
| 1,802 | ||||||
|
|
|
|
|||||
Net income before income taxes |
3,192 | 5,911 | ||||||
Income tax expense |
(477 | ) | (4,282 | ) | ||||
|
|
|
|
|||||
Net income |
2,715 | 1,629 | ||||||
Less net (income) loss attributable to noncontrolling interests in: |
||||||||
Consolidated joint ventures |
(1,055 | ) | (1,291 | ) | ||||
Consolidated real estate fund |
(430 | ) | 88 | |||||
Operating Partnership |
(116 | ) | (54 | ) | ||||
|
|
|
|
|||||
Net income attributable to common stockholders |
$ | 1,114 | $ | 372 | ||||
|
|
|
|
|||||
Per share: |
||||||||
Basic |
$ | 0.00 | $ | 0.00 | ||||
|
|
|
|
|||||
Diluted |
$ | 0.00 | $ | 0.00 | ||||
|
|
|
|
|||||
Weighted average common shares outstanding: |
||||||||
Basic |
240,311,744 | 230,924,271 | ||||||
|
|
|
|
|||||
Diluted |
240,338,698 | 230,958,441 | ||||||
|
|
|
|
7
Paramount Group, Inc.
Reconciliation of Net Income to FFO and Core FFO
(Unaudited and in thousands, except share and per share amounts)
For the Three Months Ended March 31, |
||||||||
2018 | 2017 | |||||||
Reconciliation of Net Income to FFO and Core FFO: |
||||||||
Net income |
$ | 2,715 | $ | 1,629 | ||||
Real estate depreciation and amortization (including our share of unconsolidated joint ventures) |
67,160 | 64,840 | ||||||
|
|
|
|
|||||
FFO |
69,875 | 66,469 | ||||||
Less FFO attributable to noncontrolling interests in: |
||||||||
Consolidated joint ventures |
(10,207 | ) | (7,195 | ) | ||||
Consolidated real estate fund |
(430 | ) | (140 | ) | ||||
|
|
|
|
|||||
FFO attributable to Paramount Group Operating Partnership |
59,238 | 59,134 | ||||||
Less FFO attributable to noncontrolling interests in Operating Partnership |
(5,585 | ) | (7,545 | ) | ||||
|
|
|
|
|||||
FFO attributable to common stockholders |
$ | 53,653 | $ | 51,589 | ||||
|
|
|
|
|||||
Per diluted share |
$ | 0.22 | $ | 0.22 | ||||
|
|
|
|
|||||
FFO |
$ | 69,875 | $ | 66,469 | ||||
Non-core items: |
||||||||
Our share of earnings from 712 Fifth Avenue in excess of distributions received |
1,195 | | ||||||
Realized and unrealized loss (gain) on unconsolidated real estate funds |
131 | (235 | ) | |||||
Transaction related costs |
120 | 275 | ||||||
Loss on early extinguishment of debt |
| 2,715 | ||||||
Unrealized gain on interest rate swaps (including our share of unconsolidated joint ventures) |
| (2,386 | ) | |||||
|
|
|
|
|||||
Core FFO |
71,321 | 66,838 | ||||||
Less Core FFO attributable to noncontrolling interests in: |
||||||||
Consolidated joint ventures |
(10,207 | ) | (7,661 | ) | ||||
Consolidated real estate fund |
(430 | ) | (140 | ) | ||||
|
|
|
|
|||||
Core FFO attributable to Paramount Group Operating Partnership |
60,684 | 59,037 | ||||||
Less Core FFO attributable to noncontrolling interests in Operating Partnership |
(5,721 | ) | (7,532 | ) | ||||
|
|
|
|
|||||
Core FFO attributable to common stockholders |
$ | 54,963 | $ | 51,505 | ||||
|
|
|
|
|||||
Per diluted share |
$ | 0.23 | $ | 0.22 | ||||
|
|
|
|
|||||
Reconciliation of weighted average shares outstanding: |
||||||||
Weighted average shares outstanding |
240,311,744 | 230,924,271 | ||||||
Effect of dilutive securities |
26,954 | 34,170 | ||||||
|
|
|
|
|||||
Denominator for FFO and Core FFO per diluted share |
240,338,698 | 230,958,441 | ||||||
|
|
|
|
8
Paramount Group, Inc.
Reconciliation of Net Income to Same Store NOI and Same Store Cash NOI
(Unaudited and in thousands)
Three Months Ended March 31, |
||||||||
2018 | 2017 | |||||||
Reconciliation of net income to Same Store NOI and Same Store Cash NOI: |
||||||||
Net income |
$ | 2,715 | $ | 1,629 | ||||
Add (subtract) adjustments to arrive at NOI and Cash NOI: |
||||||||
Depreciation and amortization |
65,156 | 62,992 | ||||||
General and administrative |
12,631 | 13,581 | ||||||
Interest and debt expense |
36,082 | 37,018 | ||||||
Loss on early extinguishment of debt |
| 2,715 | ||||||
Transaction related costs |
120 | 275 | ||||||
Income tax expense |
477 | 4,282 | ||||||
NOI from unconsolidated joint ventures |
4,740 | 4,823 | ||||||
Loss (income) from unconsolidated joint ventures |
62 | (1,937 | ) | |||||
Loss (income) from unconsolidated real estate funds |
66 | (288 | ) | |||||
Fee income |
(3,465 | ) | (9,556 | ) | ||||
Interest and other income, net |
(2,016 | ) | (3,200 | ) | ||||
Unrealized gain on interest rate swaps |
| (1,802 | ) | |||||
|
|
|
|
|||||
NOI |
116,568 | 110,532 | ||||||
Less NOI attributable to noncontrolling interests in: |
||||||||
Consolidated joint ventures |
(16,014 | ) | (12,029 | ) | ||||
Consolidated real estate fund |
26 | (141 | ) | |||||
|
|
|
|
|||||
PGREs share of NOI |
100,580 | 98,362 | ||||||
Acquisitions |
(2,306 | ) | | |||||
Dispositions |
| (6,300 | ) | |||||
Lease termination income (including our share of unconsolidated joint ventures) |
(190 | ) | (66 | ) | ||||
|
|
|
|
|||||
PGREs share of Same Store NOI |
$ | 98,084 | $ | 91,996 | ||||
|
|
|
|
|||||
NOI |
$ | 116,568 | $ | 110,532 | ||||
Less: |
||||||||
Straight-line rent adjustments (including our share of unconsolidated joint ventures) |
(13,197 | ) | (20,511 | ) | ||||
Amortization of above and below-market leases, net (including our share of unconsolidated joint ventures) |
(4,257 | ) | (2,881 | ) | ||||
|
|
|
|
|||||
Cash NOI |
99,114 | 87,140 | ||||||
Less Cash NOI attributable to noncontrolling interests in: |
||||||||
Consolidated joint ventures |
(13,193 | ) | (7,882 | ) | ||||
Consolidated real estate fund |
26 | (141 | ) | |||||
|
|
|
|
|||||
PGREs share of Cash NOI |
85,947 | 79,117 | ||||||
Acquisitions |
(1,964 | ) | | |||||
Dispositions |
| (6,300 | ) | |||||
Lease termination income (including our share of unconsolidated joint ventures) |
(190 | ) | (66 | ) | ||||
|
|
|
|
|||||
PGREs share of Same Store Cash NOI |
$ | 83,793 | $ | 72,751 | ||||
|
|
|
|
9
Exhibit 99.2
SUPPLEMENTAL OPERATING AND FINANCIAL DATA
FOR THE QUARTER ENDED MARCH 31, 2018
FORWARD-LOOKING STATEMENTS |
This supplemental information contains forward-looking statements within the meaning of the Federal securities laws. You can identify these statements by our use of the words assumes, believes, estimates, expects, guidance, intends, plans, projects and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and could materially affect actual results, performance or achievements. These factors include, without limitation, the ability to enter into new leases or renew leases on favorable terms, dependence on tenants financial condition, the uncertainties of real estate development, acquisition and disposition activity, the ability to effectively integrate acquisitions, the costs and availability of financing, the ability of our joint venture partners to satisfy their obligations, the effects of local, national and international economic and market conditions, the effects of acquisitions, dispositions and possible impairment charges on our operating results, regulatory changes, including changes to tax laws and regulations, and other risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission. We do not undertake a duty to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
- 2 -
TABLE OF CONTENTS |
Page | ||
Company Profile |
4 | |
Research Coverage |
5 | |
Selected Financial Information |
||
Guidance |
6 | |
Financial Highlights |
7 | |
Consolidated Balance Sheets |
8 | |
Consolidated Statements of Income |
9 | |
Select Income Statement Data |
10 | |
Funds From Operations (FFO) |
11 | |
Funds Available for Distribution (FAD) |
12 | |
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre) |
13 | |
Net Operating Income (NOI) |
14 - 15 | |
Same Store Results |
16 - 17 | |
Consolidated Joint Ventures and Fund |
18 - 19 | |
Unconsolidated Joint Ventures |
20 - 21 | |
Unconsolidated Funds Summary |
22 | |
Capital Structure |
23 | |
Debt Analysis |
24 | |
Debt Maturities |
25 | |
Selected Property Data |
||
Portfolio Summary |
26 | |
Same Store Leased Occupancy |
27 | |
Top Tenants and Industry Diversification |
28 | |
Leasing Activity |
29 | |
Lease Expirations |
30 - 33 | |
Cash Basis Capital Expenditures |
34 | |
Definitions |
35 - 36 |
- 3 -
COMPANY PROFILE |
Paramount Group, Inc. (Paramount) is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York, Washington, D.C. and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.
EXECUTIVE MANAGEMENT | ||
Albert Behler | Chairman, Chief Executive Officer and President | |
Wilbur Paes | Executive Vice President, Chief Financial Officer and Treasurer | |
Jolanta Bott | Executive Vice President, Operations and Human Resources | |
Peter Brindley | Executive Vice President, Leasing | |
Daniel Lauer | Executive Vice President, Chief Investment Officer | |
BOARD OF DIRECTORS | ||
Albert Behler | Director, Chairman of the Board | |
Thomas Armbrust | Director | |
Martin Bussmann | Director | |
Dan Emmett | Director, Chair of Nominating and Corporate Governance Committee; Lead Independent Director | |
Lizanne Galbreath | Director, Chair of Compensation Committee | |
Karin Klein | Director | |
Peter Linneman | Director, Chair of Audit Committee | |
David OConnor | Director | |
Katharina Otto-Bernstein | Director |
COMPANY INFORMATION | ||||||
Corporate Headquarters | Investor Relations | Stock Exchange Listing | Trading Symbol | |||
1633 Broadway, Suite 1801 | IR@paramount-group.com | New York Stock Exchange | PGRE | |||
New York, NY 10019 | (212) 492-2298 | |||||
(212) 237-3100 |
- 4 -
RESEARCH COVERAGE (1) |
James Feldman | Thomas Catherwood | Vin Chao | Steve Sakwa | |||
Bank of America Merrill Lynch | BTIG | Deutsche Bank | Evercore ISI | |||
(646) 855-5808 | (212) 738-6140 | (212) 250-6799 | (212) 446-9462 | |||
james.feldman@baml.com | tcatherwood@btig.com | vincent.chao@db.com | steve.sakwa@evercoreisi.com | |||
Andrew Rosivach | Jed Reagan | Richard Anderson | Vikram Malhotra | |||
Goldman Sachs | Green Street Advisors | Mizuho Securities USA Inc. | Morgan Stanley | |||
(212) 902-2796 | (949) 640-8780 | (212) 205-8445 | (212) 761-7064 | |||
andrew.rosivach@gs.com | jreagan@greenstreetadvisors.com | richard.anderson@us.mizuho-sc.com | vikram.malhotra@morganstanley.com | |||
Nick Yulico | Blaine Heck | |||||
UBS | Wells Fargo | |||||
(212) 713-3402 | (443) 263-6529 | |||||
nick.yulico@ubs.com | blaine.heck@wellsfargo.com |
(1) | With the exception of Green Street Advisors, an independent research firm, the equity analysts listed above are those analysts that, according to First Call Corporation, have published research material on the Company and are listed as covering the Company. Please note that any opinions, estimates or forecasts regarding the Companys performance made by such analysts do not represent the opinions, estimates or forecasts of the Company or its management. The Company does not by its reference above, imply its endorsement of or concurrence with any information, conclusions or recommendations made by any such analysts. |
- 5 -
GUIDANCE | ||
(unaudited and in thousands, except square feet, % and per share amounts) |
Full Year 2018 | ||||||||
Low | High | |||||||
Estimated net income attributable to common stockholders |
$ | 0.02 | $ | 0.06 | ||||
Our share of depreciation and amortization |
0.90 | 0.90 | ||||||
|
|
|
|
|||||
Estimated Core FFO (1) |
$ | 0.92 | $ | 0.96 | ||||
|
|
|
|
|||||
Assumptions |
||||||||
Leasing Activity (square feet) |
500,000 | 700,000 | ||||||
PGREs share of Same Store Leased % (2) at year end |
94.0 | % | 96.0 | % | ||||
Increase in PGREs share of Same Store Cash NOI (2) |
7.0 | % | 10.0 | % | ||||
Increase in PGREs share of Same Store NOI (2) |
6.5 | % | 9.5 | % | ||||
PGREs share of Cash NOI (2) |
349,000 | 354,000 | ||||||
PGREs share of NOI (2) |
412,000 | 419,000 | ||||||
PGREs share of straight-line rent and above and below-market lease revenue, net |
63,000 | 65,000 | ||||||
Fee income, net of income taxes |
17,000 | 18,000 | ||||||
PGREs share of interest and debt expense, including amortization of deferred financing costs |
(130,000 | ) | (128,000 | ) | ||||
General and administrative expenses |
(58,000 | ) | (56,000 | ) |
(1) | The Company is reaffirming its Estimated Core FFO Guidance for the full year of 2018, which is reconciled above to estimated net income attributable to common stockholders per diluted share in accordance with GAAP. The estimated net income attributable to common stockholders per diluted share is not a projection and is being provided solely to satisfy the disclosure requirements of the U.S. Securities and Exchange Commission. Except as described above, these estimates reflect managements view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels and the earnings impact of the events referenced in the Companys earnings release issued on May 2, 2018 and otherwise referenced during the Companys conference call scheduled for May 3, 2018. These estimates do not include the impact on operating results from possible future property acquisitions or dispositions, capital markets activity or unrealized gains or losses on real estate fund investments. The estimates set forth above may be subject to fluctuations as a result of several factors, including the straight-lining of rental income and the amortization of above and below-market leases. There can be no assurance that the Companys actual results will not differ materially from the estimates set forth above. |
(2) | See page 35 for our definition of this measure. |
- 6 -
FINANCIAL HIGHLIGHTS | ||
(unaudited and in thousands, except per share amounts) |
Three Months Ended | ||||||||||||||||||||||||||||
SELECTED FINANCIAL DATA | March 31, 2018 | March 31, 2017 | December 31, 2017 | |||||||||||||||||||||||||
Net income (loss) attributable to common stockholders |
$ | 1,114 | $ | 372 | $ | (6,793 | ) | |||||||||||||||||||||
Per sharebasic and diluted |
$ | 0.00 | $ | 0.00 | $ | (0.03 | ) | |||||||||||||||||||||
PGREs share of Cash NOI (1) |
$ | 85,947 | $ | 79,117 | $ | 83,619 | ||||||||||||||||||||||
PGREs share of NOI (1)
|
$
|
100,580
|
|
$
|
98,362
|
|
$
|
96,737
|
|
|||||||||||||||||||
Same Store Cash NOI | % Change | Same Store NOI | % Change |
|||||||||||||||||||||||||
Three Months Ended March 31, 2018 vs. March 31, 2017 |
|
15.2 | % | |
Three Months Ended
March 31, |
|
6.6 | % | ||||||||||||||||||||
Core FFO attributable to common stockholders (1) |
$ | 54,963 | $ | 51,505 | $ | 51,633 | ||||||||||||||||||||||
Per sharediluted |
$ | 0.23 | $ | 0.22 | $ | 0.22 | ||||||||||||||||||||||
FAD attributable to common stockholders (1) |
$ | 33,514 | $ | 30,281 | $ | 28,942 | ||||||||||||||||||||||
Dividends declared on common stock |
$ | 24,051 | $ | 21,981 | $ | 22,841 | ||||||||||||||||||||||
COMMON SHARE DATA | ||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
Share Price: |
March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | |||||||||||||||||||||||
High |
$ | 15.89 | $ | 16.61 | $ | 16.79 | $ | 17.25 | $ | 17.58 | ||||||||||||||||||
Low |
$ | 13.70 | $ | 15.49 | $ | 15.14 | $ | 15.32 | $ | 15.87 | ||||||||||||||||||
Closing (end of period) |
$ | 14.24 | $ | 15.85 | $ | 16.00 | $ | 16.00 | $ | 16.21 | ||||||||||||||||||
Dividends per common share |
$ | 0.100 | $ | 0.095 | $ | 0.095 | $ | 0.095 | $ | 0.095 | ||||||||||||||||||
Annualized dividends per common share |
$ | 0.400 | $ | 0.380 | $ | 0.380 | $ | 0.380 | $ | 0.380 | ||||||||||||||||||
Dividend yield (on closing share price) |
2.8 | % | 2.4 | % | 2.4 | % | 2.4 | % | 2.3 | % | ||||||||||||||||||
PORTFOLIO STATISTICS | ||||||||||||||||||||||||||||
As of | ||||||||||||||||||||||||||||
March 31, 2018 | December 31, 2017 | September 30, 2017 | June 30, 2017 | March 31, 2017 | ||||||||||||||||||||||||
Leased % (1) |
94.0 | % | 93.5 | % | 92.3 | % | 90.9 | % | 90.8 | % | ||||||||||||||||||
Same Store Leased % | % Change | |||||||||||||||||||||||||||
March 31, 2018 vs. December 31, 2017 |
|
0.5 | % |
(1) | See page 35 for our definition of this measure. |
- 7 -
CONSOLIDATED BALANCE SHEETS | ||
(unaudited and in thousands) |
March 31, 2018 | December 31, 2017 | |||||||
ASSETS: |
||||||||
Real estate, at cost |
||||||||
Land |
$ | 2,209,506 | $ | 2,209,506 | ||||
Buildings and improvements |
6,150,115 | 6,119,969 | ||||||
|
|
|
|
|||||
8,359,621 | 8,329,475 | |||||||
Accumulated depreciation and amortization |
(534,934 | ) | (487,945 | ) | ||||
|
|
|
|
|||||
Real estate, net |
7,824,687 | 7,841,530 | ||||||
Cash and cash equivalents |
212,547 | 219,381 | ||||||
Restricted cash |
33,032 | 31,044 | ||||||
Investments in unconsolidated joint ventures |
67,355 | 44,762 | ||||||
Investments in unconsolidated real estate funds |
7,276 | 7,253 | ||||||
Preferred equity investments, net |
35,870 | 35,817 | ||||||
Marketable securities |
24,984 | 29,039 | ||||||
Accounts and other receivables, net |
17,036 | 17,082 | ||||||
Deferred rent receivable |
234,758 | 220,826 | ||||||
Deferred charges, net |
106,415 | 98,645 | ||||||
Intangible assets, net |
333,983 | 352,206 | ||||||
Other assets |
75,925 | 20,076 | ||||||
|
|
|
|
|||||
Total Assets |
$ | 8,973,868 | $ | 8,917,661 | ||||
|
|
|
|
|||||
LIABILITIES: |
||||||||
Notes and mortgages payable, net |
$ | 3,560,230 | $ | 3,541,300 | ||||
Revolving credit facility |
| | ||||||
Due to affiliates |
27,299 | 27,299 | ||||||
Accounts payable and accrued expenses |
128,625 | 117,630 | ||||||
Dividends and distributions payable |
26,627 | 25,211 | ||||||
Intangible liabilities, net |
122,673 | 130,028 | ||||||
Other liabilities |
54,344 | 54,109 | ||||||
|
|
|
|
|||||
Total Liabilities |
3,919,798 | 3,895,577 | ||||||
|
|
|
|
|||||
EQUITY: |
||||||||
Paramount Group, Inc. equity |
4,162,439 | 4,176,741 | ||||||
Noncontrolling interests in: |
||||||||
Consolidated joint ventures |
404,137 | 404,997 | ||||||
Consolidated real estate fund |
51,456 | 14,549 | ||||||
Operating Partnership |
436,038 | 425,797 | ||||||
|
|
|
|
|||||
Total Equity |
5,054,070 | 5,022,084 | ||||||
|
|
|
|
|||||
Total Liabilities and Equity |
$ | 8,973,868 | $ | 8,917,661 | ||||
|
|
|
|
- 8 -
CONSOLIDATED STATEMENTS OF INCOME | ||
(unaudited and in thousands, except share and per share amounts) |
Three Months Ended | ||||||||||||
March 31, 2018 | March 31, 2017 | December 31, 2017 | ||||||||||
REVENUES: |
||||||||||||
Property rentals |
$ | 145,741 | $ | 132,235 | $ | 142,639 | ||||||
Straight-line rent adjustments |
13,244 | 20,147 | 10,924 | |||||||||
Amortization of above and below-market leases, net |
4,420 | 3,008 | 5,359 | |||||||||
|
|
|
|
|
|
|||||||
Rental income |
163,405 | 155,390 | 158,922 | |||||||||
Tenant reimbursement income |
14,246 | 12,852 | 13,657 | |||||||||
Fee income (see details on page 10) |
3,465 | 9,556 | 4,374 | |||||||||
Other income (see details on page 10) |
3,155 | 3,438 | 3,304 | |||||||||
|
|
|
|
|
|
|||||||
Total revenues |
184,271 | 181,236 | 180,257 | |||||||||
EXPENSES: |
||||||||||||
Operating |
68,978 | 65,971 | 68,440 | |||||||||
Depreciation and amortization |
65,156 | 62,992 | 67,894 | |||||||||
General and administrative (see details on page 10) |
12,631 | 13,581 | 16,953 | |||||||||
Transaction related costs |
120 | 275 | 976 | |||||||||
|
|
|
|
|
|
|||||||
Total expenses |
146,885 | 142,819 | 154,263 | |||||||||
Operating income |
37,386 | 38,417 | 25,994 | |||||||||
(Loss) income from unconsolidated joint ventures |
(62 | ) | 1,937 | 1,042 | ||||||||
(Loss) income from unconsolidated real estate funds |
(66 | ) | 288 | (90 | ) | |||||||
Interest and other income, net (see details on page 10) |
2,016 | 3,200 | 2,951 | |||||||||
Interest and debt expense (see details on page 10) |
(36,082 | ) | (37,018 | ) | (36,194 | ) | ||||||
Loss on early extinguishment of debt |
| (2,715 | ) | | ||||||||
Unrealized gain on interest rate swaps |
| 1,802 | | |||||||||
|
|
|
|
|
|
|||||||
Net income (loss) before income taxes |
3,192 | 5,911 | (6,297 | ) | ||||||||
Income tax expense |
(477 | ) | (4,282 | ) | (935 | ) | ||||||
|
|
|
|
|
|
|||||||
Net income (loss) |
2,715 | 1,629 | (7,232 | ) | ||||||||
Less net (income) loss attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(1,055 | ) | (1,291 | ) | (664 | ) | ||||||
Consolidated real estate fund |
(430 | ) | 88 | 398 | ||||||||
Operating Partnership |
(116 | ) | (54 | ) | 705 | |||||||
|
|
|
|
|
|
|||||||
Net income (loss) attributable to common stockholders |
$ | 1,114 | $ | 372 | $ | (6,793 | ) | |||||
|
|
|
|
|
|
|||||||
Weighted average common shares outstanding: |
||||||||||||
Basic |
240,311,744 | 230,924,271 | 239,997,181 | |||||||||
|
|
|
|
|
|
|||||||
Diluted |
240,338,698 | 230,958,441 | 239,997,181 | |||||||||
|
|
|
|
|
|
|||||||
Income (loss) per common share: |
||||||||||||
Basic |
$ | 0.00 | $ | 0.00 | $ | (0.03 | ) | |||||
|
|
|
|
|
|
|||||||
Diluted |
$ | 0.00 | $ | 0.00 | $ | (0.03 | ) | |||||
|
|
|
|
|
|
-9-
SELECT INCOME STATEMENT DATA | ||
(unaudited and in thousands) |
Three Months Ended | ||||||||||||
Fee Income: | March 31, 2018 | March 31, 2017 | December 31, 2017 | |||||||||
Property management |
$ | 1,502 | $ | 1,610 | $ | 1,521 | ||||||
Asset management |
1,610 | 2,266 | 1,959 | |||||||||
Acquisition and disposition |
| 5,320 | 725 | |||||||||
Other |
353 | 360 | 169 | |||||||||
|
|
|
|
|
|
|||||||
Total fee income |
$ | 3,465 | $ | 9,556 | $ | 4,374 | ||||||
|
|
|
|
|
|
|||||||
Three Months Ended | ||||||||||||
Other Income: | March 31, 2018 | March 31, 2017 | December 31, 2017 | |||||||||
Lease termination income |
$ | 28 | $ | 66 | $ | 274 | ||||||
Other (primarily parking income and tenant requested services, including overtime heating and cooling) |
3,127 | 3,372 | 3,030 | |||||||||
|
|
|
|
|
|
|||||||
Total other income |
$ | 3,155 | $ | 3,438 | $ | 3,304 | ||||||
|
|
|
|
|
|
|||||||
Three Months Ended | ||||||||||||
General and Administrative: | March 31, 2018 | March 31, 2017 | December 31, 2017 | |||||||||
Cash general and administrative |
$ | 6,275 | $ | 8,450 | $ | 9,649 | ||||||
Non-cash general and administrative - stock based compensation expense |
6,265 | 3,429 | 3,100 | |||||||||
Mark-to-market of deferred compensation plan liabilities (offset by an increase in the mark-to-market of plan assets, which is included in interest and other income) |
91 | 1,702 | 1,578 | |||||||||
Severance costs |
| | 2,626 | |||||||||
|
|
|
|
|
|
|||||||
Total general and administrative |
$ | 12,631 | $ | 13,581 | $ | 16,953 | ||||||
|
|
|
|
|
|
|||||||
Three Months Ended | ||||||||||||
Interest and Other Income: | March 31, 2018 | March 31, 2017 | December 31, 2017 | |||||||||
Preferred equity investment income (1) |
$ | 899 | $ | 1,413 | $ | 860 | ||||||
Interest income |
1,026 | 85 | 513 | |||||||||
Mark-to-market of deferred compensation plan assets (offset by an increase in the mark-to-market of plan liabilities, which is included in general and administrative expenses) |
91 | 1,702 | 1,578 | |||||||||
|
|
|
|
|
|
|||||||
Total interest and other income, net |
$ | 2,016 | $ | 3,200 | $ | 2,951 | ||||||
|
|
|
|
|
|
(1) | Represents 100% of the investment income from PGRESS Equity Holdings, L.P., of which our 24.4% share is $219, $344 and $210 for the three months ended March 31, 2018 and 2017, and December 31, 2017, respectively. |
Three Months Ended | ||||||||||||
Interest and Debt Expense: | March 31, 2018 | March 31, 2017 | December 31, 2017 | |||||||||
Interest expense |
$ | 33,321 | $ | 34,288 | $ | 33,373 | ||||||
Amortization of deferred financing costs |
2,761 | 2,730 | 2,821 | |||||||||
|
|
|
|
|
|
|||||||
Total interest and debt expense |
$ | 36,082 | $ | 37,018 | $ | 36,194 | ||||||
|
|
|
|
|
|
- 10 -
FFO | ||
(unaudited and in thousands, except share and per share amounts) |
Three Months Ended | ||||||||||||
March 31, 2018 | March 31, 2017 | December 31, 2017 | ||||||||||
Reconciliation of net income (loss) to FFO and Core FFO: |
||||||||||||
Net income (loss) |
$ | 2,715 | $ | 1,629 | $ | (7,232 | ) | |||||
Real estate depreciation and amortization (including our share of unconsolidated joint ventures) |
67,160 | 64,840 | 69,915 | |||||||||
|
|
|
|
|
|
|||||||
FFO (1) |
69,875 | 66,469 | 62,683 | |||||||||
Less FFO attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(10,207 | ) | (7,195 | ) | (9,965 | ) | ||||||
Consolidated real estate fund |
(430 | ) | (140 | ) | 398 | |||||||
|
|
|
|
|
|
|||||||
FFO attributable to Paramount Group Operating Partnership |
59,238 | 59,134 | 53,116 | |||||||||
Less FFO attributable to noncontrolling interests in Operating Partnership |
(5,585 | ) | (7,545 | ) | (4,995 | ) | ||||||
|
|
|
|
|
|
|||||||
FFO attributable to common stockholders (1) |
$ | 53,653 | $ | 51,589 | $ | 48,121 | ||||||
|
|
|
|
|
|
|||||||
Per diluted share |
$ | 0.22 | $ | 0.22 | $ | 0.20 | ||||||
|
|
|
|
|
|
|||||||
FFO |
$ | 69,875 | $ | 66,469 | $ | 62,683 | ||||||
Non-core items: |
||||||||||||
Our share of earnings from 712 Fifth Avenue in excess of distributions received |
1,195 | | 176 | |||||||||
Realized and unrealized loss (gain) from unconsolidated real estate funds |
131 | (235 | ) | 99 | ||||||||
Transaction related costs |
120 | 275 | 976 | |||||||||
Severance costs |
| | 2,626 | |||||||||
Loss on early extinguishment of debt |
| 2,715 | | |||||||||
Unrealized gain on interest rate swaps (including our share of unconsolidated joint ventures) |
| (2,386 | ) | | ||||||||
|
|
|
|
|
|
|||||||
Core FFO (1) |
71,321 | 66,838 | 66,560 | |||||||||
Less Core FFO attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(10,207 | ) | (7,661 | ) | (9,965 | ) | ||||||
Consolidated real estate fund |
(430 | ) | (140 | ) | 398 | |||||||
|
|
|
|
|
|
|||||||
Core FFO attributable to Paramount Group Operating Partnership |
60,684 | 59,037 | 56,993 | |||||||||
Less Core FFO attributable to noncontrolling interests in Operating Partnership |
(5,721 | ) | (7,532 | ) | (5,360 | ) | ||||||
|
|
|
|
|
|
|||||||
Core FFO attributable to common stockholders (1) |
$ | 54,963 | $ | 51,505 | $ | 51,633 | ||||||
|
|
|
|
|
|
|||||||
Per diluted share |
$ | 0.23 | $ | 0.22 | $ | 0.22 | ||||||
|
|
|
|
|
|
|||||||
Reconciliation of weighted average shares outstanding: |
||||||||||||
Weighted average shares outstanding |
240,311,744 | 230,924,271 | 239,997,181 | |||||||||
Effect of dilutive securities |
26,954 | 34,170 | 37,360 | |||||||||
|
|
|
|
|
|
|||||||
Denominator for FFO and Core FFO per diluted share |
240,338,698 | 230,958,441 | 240,034,541 | |||||||||
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
-11-
FAD | ||
(unaudited and in thousands) |
Three Months Ended | ||||||||||||
March 31, 2018 | March 31, 2017 | December 31, 2017 | ||||||||||
Reconciliation of Core FFO to FAD: |
||||||||||||
Core FFO |
$ | 71,321 | $ | 66,838 | $ | 66,560 | ||||||
Add (subtract) adjustments to arrive at FAD: |
||||||||||||
Amortization of stock-based compensation expense |
6,265 | 3,429 | 3,100 | |||||||||
Amortization of deferred financing costs (including our share of unconsolidated joint ventures) |
2,835 | 2,798 | 2,895 | |||||||||
Amortization of above and below-market leases, net (including our share of unconsolidated joint ventures) |
(4,257 | ) | (2,881 | ) | (5,196 | ) | ||||||
Expenditures to maintain assets |
(3,702 | ) | (5,555 | ) | (8,623 | ) | ||||||
Second generation tenant improvements and leasing commissions |
(14,983 | ) | (7,408 | ) | (10,744 | ) | ||||||
Straight-line rent adjustments (including our share of unconsolidated joint ventures) |
(13,197 | ) | (20,511 | ) | (10,765 | ) | ||||||
|
|
|
|
|
|
|||||||
FAD (1) |
44,282 | 36,710 | 37,227 | |||||||||
Less FAD attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(6,850 | ) | (1,860 | ) | (5,687 | ) | ||||||
Consolidated real estate fund |
(430 | ) | (140 | ) | 407 | |||||||
|
|
|
|
|
|
|||||||
FAD attributable to Paramount Group Operating Partnership |
37,002 | 34,710 | 31,947 | |||||||||
Less FAD attributable to noncontrolling interests in Operating Partnership |
(3,488 | ) | (4,429 | ) | (3,005 | ) | ||||||
|
|
|
|
|
|
|||||||
FAD attributable to common stockholders (1) (2) |
$ | 33,514 | $ | 30,281 | $ | 28,942 | ||||||
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
(2) | FAD attributable to common stockholders is not necessarily indicative of future FAD amounts due to fluctuations in the timing of payments for tenant improvements and leasing commissions versus rents received from leases for which such costs are incurred. |
-12-
EBITDAre | ||
(unaudited and in thousands) |
Three Months Ended | ||||||||||||
March 31, 2018 | March 31, 2017 | December 31, 2017 | ||||||||||
Reconciliation of net income (loss) to EBITDAre and Adjusted EBITDAre: |
|
|||||||||||
Net income (loss) |
$ | 2,715 | $ | 1,629 | $ | (7,232 | ) | |||||
Add (subtract) adjustments to arrive at EBITDAre and Adjusted EBITDAre: |
||||||||||||
Depreciation and amortization (including our share of unconsolidated joint ventures) |
67,160 | 64,840 | 69,915 | |||||||||
Interest and debt expense (including our share of unconsolidated joint ventures) |
37,744 | 38,653 | 37,869 | |||||||||
Income tax expense (including our share of unconsolidated joint ventures) |
478 | 4,282 | 935 | |||||||||
|
|
|
|
|
|
|||||||
EBITDAre (1) |
108,097 | 109,404 | 101,487 | |||||||||
Less EBITDAre attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(16,786 | ) | (12,645 | ) | (16,684 | ) | ||||||
Consolidated real estate fund |
(432 | ) | (141 | ) | 398 | |||||||
|
|
|
|
|
|
|||||||
PGREs share of EBITDAre (1) |
$ | 90,879 | $ | 96,618 | $ | 85,201 | ||||||
|
|
|
|
|
|
|||||||
EBITDAre |
$ | 108,097 | $ | 109,404 | $ | 101,487 | ||||||
Add (subtract) adjustments to arrive at Adjusted EBITDAre: |
||||||||||||
Our share of earnings from 712 Fifth Avenue in excess of distributions received |
1,195 | | 176 | |||||||||
EBITDAre from real estate funds |
(414 | ) | (450 | ) | 554 | |||||||
Transaction related costs |
120 | 275 | 976 | |||||||||
Severance costs |
| | 2,626 | |||||||||
Loss on early extinguishment of debt |
| 2,715 | | |||||||||
Unrealized gain on interest rate swaps (including our share of unconsolidated joint ventures) |
| (2,386 | ) | | ||||||||
|
|
|
|
|
|
|||||||
Adjusted EBITDAre (1) |
108,998 | 109,558 | 105,819 | |||||||||
Less Adjusted EBITDAre attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(16,786 | ) | (13,111 | ) | (16,685 | ) | ||||||
|
|
|
|
|
|
|||||||
PGREs share of Adjusted EBITDAre (1) |
$ | 92,212 | $ | 96,447 | $ | 89,134 | ||||||
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
-13-
NOI | ||
(unaudited and in thousands) |
Three Months Ended | ||||||||||||
March 31, 2018 | March 31, 2017 | December 31, 2017 | ||||||||||
Reconciliation of net income (loss) to NOI and Cash NOI: |
||||||||||||
Net income (loss) |
$ | 2,715 | $ | 1,629 | $ | (7,232 | ) | |||||
Add (subtract) adjustments to arrive at NOI and Cash NOI: |
||||||||||||
Depreciation and amortization |
65,156 | 62,992 | 67,894 | |||||||||
General and administrative |
12,631 | 13,581 | 16,953 | |||||||||
Interest and debt expense |
36,082 | 37,018 | 36,194 | |||||||||
Loss on early extinguishment of debt |
| 2,715 | | |||||||||
Transaction related costs |
120 | 275 | 976 | |||||||||
Income tax expense |
477 | 4,282 | 935 | |||||||||
NOI from unconsolidated joint ventures |
4,740 | 4,823 | 4,869 | |||||||||
Loss (income) from unconsolidated joint ventures |
62 | (1,937 | ) | (1,042 | ) | |||||||
Loss (income) from unconsolidated real estate funds |
66 | (288 | ) | 90 | ||||||||
Fee income |
(3,465 | ) | (9,556 | ) | (4,374 | ) | ||||||
Interest and other income, net |
(2,016 | ) | (3,200 | ) | (2,951 | ) | ||||||
Unrealized gain on interest rate swaps |
| (1,802 | ) | | ||||||||
|
|
|
|
|
|
|||||||
NOI (1) |
116,568 | 110,532 | 112,312 | |||||||||
Less NOI attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(16,014 | ) | (12,029 | ) | (15,928 | ) | ||||||
Consolidated real estate fund |
26 | (141 | ) | 353 | ||||||||
|
|
|
|
|
|
|||||||
PGREs share of NOI (1) |
$ | 100,580 | $ | 98,362 | $ | 96,737 | ||||||
|
|
|
|
|
|
|||||||
NOI (1) |
$ | 116,568 | $ | 110,532 | $ | 112,312 | ||||||
Less: |
||||||||||||
Straight-line rent adjustments (including our share of unconsolidated joint ventures) |
(13,197 | ) | (20,511 | ) | (10,765 | ) | ||||||
Amortization of above and below-market leases, net (including our share of unconsolidated joint ventures) |
(4,257 | ) | (2,881 | ) | (5,196 | ) | ||||||
|
|
|
|
|
|
|||||||
Cash NOI (1) |
99,114 | 87,140 | 96,351 | |||||||||
Less Cash NOI attributable to noncontrolling interests in: |
||||||||||||
Consolidated joint ventures |
(13,193 | ) | (7,882 | ) | (13,085 | ) | ||||||
Consolidated real estate fund |
26 | (141 | ) | 353 | ||||||||
|
|
|
|
|
|
|||||||
PGREs share of Cash NOI (1) |
$ | 85,947 | $ | 79,117 | $ | 83,619 | ||||||
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
- 14 -
NOI | ||
(unaudited and in thousands) |
Three Months Ended March 31, 2018 | ||||||||||||||||||||
Total | New York | Washington, D.C. | San Francisco | Other | ||||||||||||||||
Reconciliation of net income (loss) to NOI and Cash NOI: |
||||||||||||||||||||
Net income (loss) |
$ | 2,715 | $ | 5,479 | $ | 4,092 | $ | 4,909 | $ | (11,765 | ) | |||||||||
Add (subtract) adjustments to arrive at NOI and Cash NOI: |
||||||||||||||||||||
Depreciation and amortization |
65,156 | 38,186 | 5,512 | 20,863 | 595 | |||||||||||||||
General and administrative |
12,631 | | | | 12,631 | |||||||||||||||
Interest and debt expense |
36,082 | 22,746 | | 12,167 | 1,169 | |||||||||||||||
Transaction related costs |
120 | | | | 120 | |||||||||||||||
Income tax expense |
477 | | | 3 | 474 | |||||||||||||||
NOI from unconsolidated joint ventures |
4,740 | 4,665 | | | 75 | |||||||||||||||
Loss (income) from unconsolidated joint ventures |
62 | 73 | | | (11 | ) | ||||||||||||||
Loss from unconsolidated real estate funds |
66 | | | | 66 | |||||||||||||||
Fee income |
(3,465 | ) | | | | (3,465 | ) | |||||||||||||
Interest and other income, net |
(2,016 | ) | | | (159 | ) | (1,857 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
NOI (1) |
116,568 | 71,149 | 9,604 | 37,783 | (1,968 | ) | ||||||||||||||
Less NOI attributable to noncontrolling interests in: |
||||||||||||||||||||
Consolidated joint ventures |
(16,014 | ) | | | (16,014 | ) | | |||||||||||||
Consolidated real estate fund |
26 | | | | 26 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of NOI for the three months ended March 31, 2018 |
$ | 100,580 | $ | 71,149 | $ | 9,604 | $ | 21,769 | $ | (1,942 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of NOI for the three months ended March 31, 2017 |
$ | 98,362 | $ | 65,318 | $ | 14,863 | $ | 19,305 | $ | (1,124 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
NOI (1) |
$ | 116,568 | $ | 71,149 | $ | 9,604 | $ | 37,783 | $ | (1,968 | ) | |||||||||
Add (subtract) adjustments to arrive at Cash NOI: |
||||||||||||||||||||
Straight-line rent adjustments (including our share of unconsolidated joint ventures) |
(13,197 | ) | (9,508 | ) | 158 | (3,908 | ) | 61 | ||||||||||||
Amortization of above and below-market leases, net (including our share of unconsolidated joint ventures) |
(4,257 | ) | 557 | (547 | ) | (4,267 | ) | | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Cash NOI (1) |
99,114 | 62,198 | 9,215 | 29,608 | (1,907 | ) | ||||||||||||||
Less Cash NOI attributable to noncontrolling interests in: |
||||||||||||||||||||
Consolidated joint ventures |
(13,193 | ) | | | (13,193 | ) | | |||||||||||||
Consolidated real estate fund |
26 | | | | 26 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of Cash NOI for the three months ended March 31, 2018 |
$ | 85,947 | $ | 62,198 | $ | 9,215 | $ | 16,415 | $ | (1,881 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of Cash NOI for the three months ended March 31, 2017 |
$ | 79,117 | $ | 53,490 | $ | 13,253 | $ | 13,437 | $ | (1,063 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
- 15 -
SAME STORE RESULTS | ||
(unaudited and in thousands) |
SAME STORE CASH NOI (1) | Three Months Ended March 31, 2018 | |||||||||||||||||||
Total | New York | Washington, D.C. | San Francisco | Other | ||||||||||||||||
PGREs share of Cash NOI for the three months ended March 31, 2018 |
$ | 85,947 | $ | 62,198 | $ | 9,215 | $ | 16,415 | $ | (1,881 | ) | |||||||||
Acquisitions (2) |
(1,964 | ) | (215 | ) | | (1,749 | ) | | ||||||||||||
Dispositions |
| | | | | |||||||||||||||
Lease termination income (including our share of unconsolidated joint ventures) |
(190 | ) | (190 | ) | | | | |||||||||||||
Other, net |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of Same Store Cash NOI (1) for the three months ended March 31, 2018 |
$ | 83,793 | $ | 61,793 | $ | 9,215 | $ | 14,666 | $ | (1,881 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Three Months Ended March 31, 2017 | ||||||||||||||||||||
Total | New York | Washington, D.C. | San Francisco | Other | ||||||||||||||||
PGREs share of Cash NOI for the three months ended March 31, 2017 |
$ | 79,117 | $ | 53,490 | $ | 13,253 | $ | 13,437 | $ | (1,063 | ) | |||||||||
Acquisitions |
| | | | | |||||||||||||||
Dispositions (3) |
(6,300 | ) | | (6,300 | ) | | | |||||||||||||
Lease termination income (including our share of unconsolidated joint ventures) |
(66 | ) | (66 | ) | | | | |||||||||||||
Other, net |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of Same Store Cash NOI (1) for the three months ended March 31, 2017 |
$ | 72,751 | $ | 53,424 | $ | 6,953 | $ | 13,437 | $ | (1,063 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Increase (decrease) in PGREs share of Same Store Cash NOI |
$ | 11,042 | $ | 8,369 | $ | 2,262 | $ | 1,229 | $ | (818 | ) | |||||||||
% Increase |
15.2 | % | 15.7 | % | 32.5 | % | 9.1 | % |
(1) | See page 35 for our definition of this measure. |
(2) | Represents our share of Cash NOI attributable to acquired properties (60 Wall Street in New York and 50 Beale Street in San Francisco) for the months in which they were not owned by us in both reporting periods. |
(3) | Represents our share of Cash NOI attributable to sold properties (Waterview in Washington, D.C.) for the months in which they were not owned by us in both reporting periods. |
- 16 -
SAME STORE RESULTS | ||
(unaudited and in thousands) |
SAME STORE NOI (1) | Three Months Ended March 31, 2018 | |||||||||||||||||||
Total | New York | Washington, D.C. | San Francisco | Other | ||||||||||||||||
PGREs share of NOI for the three months ended March 31, 2018 |
$ | 100,580 | $ | 71,149 | $ | 9,604 | $ | 21,769 | $ | (1,942 | ) | |||||||||
Acquisitions (2) |
(2,306 | ) | (173 | ) | | (2,133 | ) | | ||||||||||||
Dispositions |
| | | | | |||||||||||||||
Lease termination income (including our share of unconsolidated joint ventures) |
(190 | ) | (190 | ) | | | | |||||||||||||
Other, net |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of Same Store NOI (1) for the three months ended March 31, 2018 |
$ | 98,084 | $ | 70,786 | $ | 9,604 | $ | 19,636 | $ | (1,942 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Three Months Ended March 31, 2017 | ||||||||||||||||||||
Total | New York | Washington, D.C. | San Francisco | Other | ||||||||||||||||
PGREs share of NOI for the three months ended March 31, 2017 |
$ | 98,362 | $ | 65,318 | $ | 14,863 | $ | 19,305 | $ | (1,124 | ) | |||||||||
Acquisitions |
| | | | | |||||||||||||||
Dispositions (3) |
(6,300 | ) | | (6,300 | ) | | | |||||||||||||
Lease termination income (including our share of unconsolidated joint ventures) |
(66 | ) | (66 | ) | | | | |||||||||||||
Other, net |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
PGREs share of Same Store NOI (1) for the three months ended March 31, 2017 |
$ | 91,996 | $ | 65,252 | $ | 8,563 | $ | 19,305 | $ | (1,124 | ) | |||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Increase (decrease) in PGREs share of Same Store NOI |
$ | 6,088 | $ | 5,534 | $ | 1,041 | $ | 331 | $ | (818 | ) | |||||||||
% Increase |
6.6 | % | 8.5 | % | 12.2 | % | 1.7 | % |
(1) | See page 35 for our definition of this measure. |
(2) | Represents our share of NOI attributable to acquired properties (60 Wall Street in New York and 50 Beale Street in San Francisco) for the months in which they were not owned by us in both reporting periods. |
(3) | Represents our share of NOI attributable to sold properties (Waterview in Washington, D.C.) for the months in which they were not owned by us in both reporting periods. |
- 17 -
CONSOLIDATED JOINT VENTURES AND FUND - BALANCE SHEETS | ||
(unaudited and in thousands) |
As of March 31, 2018 | As of December 31, 2017 | |||||||||||||||||||||||||||||||||||||||
Consolidated Joint Ventures | Consolidated Fund |
Consolidated Joint Ventures | Consolidated Fund |
|||||||||||||||||||||||||||||||||||||
Total Consolidated Joint Ventures |
One Market Plaza |
50 Beale Street |
PGRESS Equity Holdings L.P. |
Residential Development Fund |
Total Consolidated Joint Ventures |
One Market Plaza |
50 Beale Street |
PGRESS Equity Holdings L.P. |
Residential Development Fund |
|||||||||||||||||||||||||||||||
PGRE Ownership |
49.0% | 31.1% | 24.4% | 7.4% | 49.0% | 31.1% | 24.4% | 7.4% | ||||||||||||||||||||||||||||||||
ASSETS: |
||||||||||||||||||||||||||||||||||||||||
Real estate, net |
$ | 1,718,880 | $ | 1,240,009 | $ | 478,871 | $ | | $ | | $ | 1,726,800 | $ | 1,246,427 | $ | 480,373 | $ | | $ | | ||||||||||||||||||||
Cash and cash equivalents |
64,870 | 40,296 | 24,189 | 385 | 1,140 | 46,839 | 24,658 | 21,792 | 389 | 656 | ||||||||||||||||||||||||||||||
Restricted cash |
5,541 | 5,541 | | | | 8,163 | 8,163 | | | | ||||||||||||||||||||||||||||||
Preferred equity investments, net |
35,870 | | | 35,870 | | 35,817 | | | 35,817 | | ||||||||||||||||||||||||||||||
Investments in unconsolidated |
| | | | 39,230 | | | | | 16,031 | ||||||||||||||||||||||||||||||
Accounts and other receivables, net |
2,562 | 1,703 | 859 | | 2 | 2,548 | 1,423 | 1,125 | | 2 | ||||||||||||||||||||||||||||||
Deferred rent receivable |
45,504 | 44,485 | 1,019 | | | 44,000 | 43,332 | 668 | | | ||||||||||||||||||||||||||||||
Deferred charges, net |
9,192 | 7,956 | 1,236 | | | 8,123 | 7,508 | 615 | | | ||||||||||||||||||||||||||||||
Intangible assets, net |
61,073 | 36,699 | 24,374 | | | 66,112 | 39,421 | 26,691 | | | ||||||||||||||||||||||||||||||
Other assets |
378 | 340 | 38 | | 15,686 | 908 | 747 | 161 | | 10 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Assets |
$ | 1,943,870 | $ | 1,377,029 | $ | 530,586 | $ | 36,255 | $ | 56,058 | $ | 1,939,310 | $ | 1,371,679 | $ | 531,425 | $ | 36,206 | $ | 16,699 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
LIABILITIES: |
||||||||||||||||||||||||||||||||||||||||
Notes and mortgages payable, net |
$ | 1,196,867 | $ | 968,867 | $ | 228,000 | $ | | $ | | $ | 1,196,607 | $ | 968,607 | $ | 228,000 | $ | | $ | | ||||||||||||||||||||
Accounts payable and |
30,364 | 22,241 | 8,071 | 52 | 57 | 21,134 | 14,876 | 6,205 | 53 | 62 | ||||||||||||||||||||||||||||||
Intangible liabilities, net |
42,519 | 33,984 | 8,535 | | | 46,365 | 36,793 | 9,572 | | | ||||||||||||||||||||||||||||||
Other liabilities |
155 | 148 | 7 | | | 156 | 149 | 7 | | | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Liabilities |
1,269,905 | 1,025,240 | 244,613 | 52 | 57 | 1,264,262 | 1,020,425 | 243,784 | 53 | 62 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
EQUITY: |
||||||||||||||||||||||||||||||||||||||||
Paramount Group, Inc. equity |
269,828 | 172,444 | 88,160 | 9,224 | 4,545 | 270,051 | 172,182 | 88,695 | 9,174 | 2,088 | ||||||||||||||||||||||||||||||
Noncontrolling interests |
404,137 | 179,345 | 197,813 | 26,979 | 51,456 | 404,997 | 179,072 | 198,946 | 26,979 | 14,549 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Equity |
673,965 | 351,789 | 285,973 | 36,203 | 56,001 | 675,048 | 351,254 | 287,641 | 36,153 | 16,637 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total Liabilities and Equity |
$ | 1,943,870 | $ | 1,377,029 | $ | 530,586 | $ | 36,255 | $ | 56,058 | $ | 1,939,310 | $ | 1,371,679 | $ | 531,425 | $ | 36,206 | $ | 16,699 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- 18 -
CONSOLIDATED JOINT VENTURES AND FUND - OPERATING RESULTS | ||
(unaudited and in thousands) |
Three Months Ended March 31, 2018 | Three Months Ended March 31, 2017 | |||||||||||||||||||||||||||||||||||
Consolidated Joint Ventures | Consolidated Fund |
Consolidated Joint Ventures | Consolidated Fund |
|||||||||||||||||||||||||||||||||
Total Consolidated Joint Ventures |
One Market Plaza |
50 Beale Street (1) |
PGRESS Equity Holdings L.P. |
Residential Development Fund |
Total Consolidated Joint Ventures |
One Market Plaza |
PGRESS Equity Holdings L.P. |
Residential Development Fund |
||||||||||||||||||||||||||||
Total revenues |
$ | 40,845 | $ | 31,930 | $ | 8,915 | $ | | $ | 2 | $ | 31,119 | $ | 31,119 | $ | | $ | 868 | ||||||||||||||||||
Total operating expenses |
10,572 | 7,522 | 3,050 | | 1 | 7,278 | 7,278 | | 414 | |||||||||||||||||||||||||||
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|
|||||||||||||||||||
Net operating income |
30,273 | 24,408 | 5,865 | | 1 | 23,841 | 23,841 | | 454 | |||||||||||||||||||||||||||
Depreciation and amortization |
(16,206 | ) | (11,249 | ) | (4,957 | ) | | | (11,573 | ) | (11,573 | ) | | (259 | ) | |||||||||||||||||||||
Interest and other income, net |
1,058 | 92 | 67 | 899 | 509 | 1,438 | 25 | 1,413 | | |||||||||||||||||||||||||||
Interest and debt expense |
(12,167 | ) | (10,086 | ) | (2,081 | ) | | | (13,478 | ) | (13,478 | ) | | | ||||||||||||||||||||||
Income from unconsolidated joint venture |
| | | | (2 | ) | | | | | ||||||||||||||||||||||||||
Unrealized gain on interest rate swaps |
| | | | | 1,802 | 1,802 | | | |||||||||||||||||||||||||||
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|
|||||||||||||||||||
Net income (loss) before income taxes |
2,958 | 3,165 | (1,106 | ) | 899 | 508 | 2,030 | 617 | 1,413 | 195 | ||||||||||||||||||||||||||
Income tax expense |
(3 | ) | (3 | ) | | | (2 | ) | (2 | ) | (2 | ) | | (2 | ) | |||||||||||||||||||||
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|||||||||||||||||||
Net income (loss) |
$ | 2,955 | $ | 3,162 | $ | (1,106 | ) | $ | 899 | $ | 506 | $ | 2,028 | $ | 615 | $ | 1,413 | $ | 193 | |||||||||||||||||
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|||||||||||||||||||
PGREs share Ownership |
Total | 49.0% | 31.1% | 24.4% | 7.4% | Total | 49.0% | 24.4% | 12.9% | |||||||||||||||||||||||||||
Net income (loss) |
$ | 1,408 | $ | 1,549 | $ | (360 | ) | $ | 219 | $ | 50 | $ | 605 | $ | 261 | $ | 344 | $ | 24 | |||||||||||||||||
Add: Management fee income |
492 | 167 | 325 | | 26 | 132 | 132 | | 257 | |||||||||||||||||||||||||||
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|||||||||||||||||||
PGREs share of net income (loss) |
1,900 | 1,716 | (35 | ) | 219 | 76 | 737 | 393 | 344 | 281 | ||||||||||||||||||||||||||
Add: Real estate depreciation and amortization |
7,054 | 5,512 | 1,542 | | | 5,669 | 5,669 | | 31 | |||||||||||||||||||||||||||
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|||||||||||||||||||
FFO (2) |
8,954 | 7,228 | 1,507 | 219 | 76 | 6,406 | 6,062 | 344 | 312 | |||||||||||||||||||||||||||
Add: Loss on early extinguishment of debt |
| | | | | 1,330 | 1,330 | | | |||||||||||||||||||||||||||
Less: Unrealized gain on interest rate swaps |
| | | | | (883 | ) | (883 | ) | | | |||||||||||||||||||||||||
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|||||||||||||||||||
Core FFO (2) |
$ | 8,954 | $ | 7,228 | $ | 1,507 | $ | 219 | $ | 76 | $ | 6,853 | $ | 6,509 | $ | 344 | $ | 312 | ||||||||||||||||||
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|||||||||||||||||||
Noncontrolling Interests share Ownership |
Total | 51.0% | 68.9% | 75.6% | 92.6% | Total | 51.0% | 75.6% | 87.1% | |||||||||||||||||||||||||||
Net income (loss) |
$ | 1,547 | $ | 1,613 | $ | (746 | ) | $ | 680 | $ | 456 | $ | 1,423 | $ | 354 | $ | 1,069 | $ | 169 | |||||||||||||||||
Less: Management fee expense |
(492 | ) | (167 | ) | (325 | ) | | (26 | ) | (132 | ) | (132 | ) | | (257 | ) | ||||||||||||||||||||
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|||||||||||||||||||
Net income (loss) attributable to noncontrolling interests |
1,055 | 1,446 | (1,071 | ) | 680 | 430 | 1,291 | 222 | 1,069 | (88 | ) | |||||||||||||||||||||||||
Add: Real estate depreciation and amortization |
9,152 | 5,737 | 3,415 | | | 5,904 | 5,904 | | 228 | |||||||||||||||||||||||||||
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|||||||||||||||||||
FFO (2) |
10,207 | 7,183 | 2,344 | 680 | 430 | 7,195 | 6,126 | 1,069 | 140 | |||||||||||||||||||||||||||
Add: Loss on early extinguishment of debt |
| | | | | 1,385 | 1,385 | | | |||||||||||||||||||||||||||
Less: Unrealized gain on interest rate swaps |
| | | | | (919 | ) | (919 | ) | | | |||||||||||||||||||||||||
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|||||||||||||||||||
Core FFO (2) |
$ | 10,207 | $ | 7,183 | $ | 2,344 | $ | 680 | $ | 430 | $ | 7,661 | $ | 6,592 | $ | 1,069 | $ | 140 | ||||||||||||||||||
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(1) | Acquired on July 17, 2017. |
(2) | See page 35 for our definition of this measure. |
- 19 -
UNCONSOLIDATED JOINT VENTURES - BALANCE SHEETS | ||
(unaudited and in thousands) |
As of March 31, 2018 | As of December 31, 2017 | |||||||||||||||||||||||||||||||
Total | 712 Fifth Avenue |
60 Wall Street |
Other (1) | Total | 712 Fifth Avenue |
60 Wall Street |
Other (1) | |||||||||||||||||||||||||
PGRE Ownership | 50.0% | 5.0% | Various | 50.0% | 5.0% | Various | ||||||||||||||||||||||||||
ASSETS: |
||||||||||||||||||||||||||||||||
Real estate, net |
$ | 1,189,801 | $ | 199,948 | $ | 868,050 | $ | 121,803 | $ | 1,196,116 | $ | 202,040 | $ | 873,142 | $ | 120,934 | ||||||||||||||||
Cash and cash equivalents |
54,418 | 34,254 | 18,511 | 1,653 | 52,132 | 31,511 | 18,642 | 1,979 | ||||||||||||||||||||||||
Restricted cash |
4,007 | 3,805 | | 202 | 4,726 | 4,726 | | | ||||||||||||||||||||||||
Accounts and other receivables, net |
303 | 280 | | 23 | 296 | 296 | | | ||||||||||||||||||||||||
Deferred rent receivable |
15,246 | 13,375 | 1,871 | | 15,446 | 13,456 | 1,990 | | ||||||||||||||||||||||||
Deferred charges, net |
7,448 | 7,448 | | | 7,848 | 7,848 | | | ||||||||||||||||||||||||
Intangible assets, net |
119,231 | | 119,231 | | 126,422 | | 126,422 | | ||||||||||||||||||||||||
Other assets |
9,900 | 3,827 | 5,404 | 669 | 1,148 | 197 | 105 | 846 | ||||||||||||||||||||||||
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|
|||||||||||||||||
Total Assets |
$ | 1,400,354 | $ | 262,937 | $ | 1,013,067 | $ | 124,350 | $ | 1,404,134 | $ | 260,074 | $ | 1,020,301 | $ | 123,759 | ||||||||||||||||
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|||||||||||||||||
LIABILITIES: |
||||||||||||||||||||||||||||||||
Notes and mortgages payable, net |
$ | 887,419 | $ | 296,235 | $ | 568,233 | $ | 22,951 | $ | 886,902 | $ | 296,132 | $ | 567,799 | $ | 22,971 | ||||||||||||||||
Accounts payable and accrued expenses |
19,188 | 4,812 | 12,695 | 1,681 | 12,560 | 4,435 | 7,382 | 743 | ||||||||||||||||||||||||
Other liabilities |
1,380 | 174 | 836 | 370 | 1,636 | 180 | 850 | 606 | ||||||||||||||||||||||||
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|
|||||||||||||||||
Total Liabilities |
907,987 | 301,221 | 581,764 | 25,002 | 901,098 | 300,747 | 576,031 | 24,320 | ||||||||||||||||||||||||
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|||||||||||||||||
EQUITY: |
||||||||||||||||||||||||||||||||
Total Equity |
492,367 | (38,284 | ) | 431,303 | 99,348 | 503,036 | (40,673 | ) | 444,270 | 99,439 | ||||||||||||||||||||||
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|||||||||||||||||
Total Liabilities and Equity |
$ | 1,400,354 | $ | 262,937 | $ | 1,013,067 | $ | 124,350 | $ | 1,404,134 | $ | 260,074 | $ | 1,020,301 | $ | 123,759 | ||||||||||||||||
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|
(1) | Represents Oder-Center, Germany and 75 Howard. |
- 20 -
UNCONSOLIDATED JOINT VENTURES - OPERATING RESULTS | ||
(unaudited and in thousands) |
Three Months Ended March 31, 2018 | Three Months Ended March 31, 2017 | |||||||||||||||||||||||||||||||
Total | 712 Fifth Avenue |
60 Wall Street (1) |
Other (2) | Total | 712 Fifth Avenue |
60 Wall Street (1) |
Oder-Center, Germany |
|||||||||||||||||||||||||
Total revenues |
$ | 35,971 | $ | 14,132 | $ | 20,443 | $ | 1,396 | $ | 30,615 | $ | 14,379 | $ | 15,224 | $ | 1,012 | ||||||||||||||||
Total operating expenses |
13,527 | 6,184 | 6,740 | 603 | 10,962 | 5,966 | 4,725 | 271 | ||||||||||||||||||||||||
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|
|||||||||||||||||
Net operating income |
22,444 | 7,948 | 13,703 | 793 | 19,653 | 8,413 | 10,499 | 741 | ||||||||||||||||||||||||
Depreciation and amortization expense |
(12,161 | ) | (3,026 | ) | (9,033 | ) | (102 | ) | (9,811 | ) | (2,920 | ) | (6,799 | ) | (92 | ) | ||||||||||||||||
Interest and other income, net |
170 | 113 | 56 | 1 | 30 | 24 | 6 | | ||||||||||||||||||||||||
Interest and debt expense |
(9,179 | ) | (2,645 | ) | (6,270 | ) | (264 | ) | (6,893 | ) | (2,825 | ) | (3,815 | ) | (253 | ) | ||||||||||||||||
Unrealized gain on interest rate swaps |
| | | | 1,168 | 1,168 | | | ||||||||||||||||||||||||
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|
|||||||||||||||||
Net income (loss) before income taxes |
1,274 | 2,390 | (1,544 | ) | 428 | 4,147 | 3,860 | (109 | ) | 396 | ||||||||||||||||||||||
Income tax expense |
(10 | ) | | | (10 | ) | (2 | ) | | | (2 | ) | ||||||||||||||||||||
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Net income (loss) |
$ | 1,264 | $ | 2,390 | $ | (1,544 | ) | $ | 418 | $ | 4,145 | $ | 3,860 | $ | (109 | ) | $ | 394 | ||||||||||||||
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|||||||||||||||||
PGREs share Ownership | Total | 50.0% | 5.0% | Various | Total | 50.0% | 5.0% | 9.5% | ||||||||||||||||||||||||
Net income (loss) |
$ | 1,161 | $ | 1,195 | $ | (73 | ) | $ | 39 | $ | 1,962 | $ | 1,930 | $ | (5 | ) | $ | 37 | ||||||||||||||
Less: Step-up basis adjustment |
(28 | ) | | | (28 | ) | (25 | ) | | | (25 | ) | ||||||||||||||||||||
Less: Earnings in excess of distributions |
(1,195 | ) | (1,195 | ) | | | | | | | ||||||||||||||||||||||
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PGREs share of net (loss) income |
(62 | ) | | (73 | ) | 11 | 1,937 | 1,930 | (5 | ) | 12 | |||||||||||||||||||||
Less: Noncontrolling interests |
| | | | | | | | ||||||||||||||||||||||||
Add: Real estate depreciation and amortization |
2,004 | 1,513 | 453 | 38 | 1,848 | 1,460 | 354 | 34 | ||||||||||||||||||||||||
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|||||||||||||||||
FFO (3) |
1,942 | 1,513 | 380 | 49 | 3,785 | 3,390 | 349 | 46 | ||||||||||||||||||||||||
Add: Earnings in excess of distributions |
1,195 | 1,195 | | | | | | | ||||||||||||||||||||||||
Less: Unrealized gain on interest rate swaps |
| | | | (584 | ) | (584 | ) | | | ||||||||||||||||||||||
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Core FFO (3) |
$ | 3,137 | $ | 2,708 | $ | 380 | $ | 49 | $ | 3,201 | $ | 2,806 | $ | 349 | $ | 46 | ||||||||||||||||
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|||||||||||||||||
Joint Venture Partners share Ownership | Total | 50.0% | 95.0% | Various | Total | 50.0% | 95.0% | 90.5% | ||||||||||||||||||||||||
Net income (loss) |
$ | 103 | $ | 1,195 | $ | (1,471 | ) | $ | 379 | $ | 2,183 | $ | 1,930 | $ | (104 | ) | $ | 357 | ||||||||||||||
Add: Real estate depreciation and amortization |
10,185 | 1,513 | 8,580 | 92 | 7,988 | 1,460 | 6,445 | 83 | ||||||||||||||||||||||||
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|
|||||||||||||||||
FFO (3) |
10,288 | 2,708 | 7,109 | 471 | 10,171 | 3,390 | 6,341 | 440 | ||||||||||||||||||||||||
Less: Unrealized gain on interest rate swaps |
| | | | (584 | ) | (584 | ) | | | ||||||||||||||||||||||
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|||||||||||||||||
Core FFO (3) |
$ | 10,288 | $ | 2,708 | $ | 7,109 | $ | 471 | $ | 9,587 | $ | 2,806 | $ | 6,341 | $ | 440 | ||||||||||||||||
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|
(1) | Acquired on January 24, 2017. |
(2) | Represents Oder-Center, Germany and 75 Howard. |
(3) | See page 35 for our definition of this measure. |
- 21 -
UNCONSOLIDATED FUNDS SUMMARY | ||
(unaudited and in thousands) |
Debt Fund:
The following is a summary of our Debt Fund and our ownership interests in the underlying investments, as of March 31, 2018.
PGRE Ownership |
Fixed / Variable rate |
Interest Rate |
Face Amount | Fair Value | ||||||||||||||||||||||||||||
Investments |
Investment Type |
Maturity | Total | Our Share | Total | Our Share | ||||||||||||||||||||||||||
26 Broadway |
Mezzanine Loan |
1.3 | % | Fixed | 8.25 | % | Jan-2022 | $ | 50,000 | $ | 645 | $ | 50,299 | $ | 649 | |||||||||||||||||
700 Eighth Avenue |
Mortgage and Mezzanine Loans |
1.3 | % | Variable (LIBOR plus 600 bps) | 7.69 | % | Jan-2019 | 74,000 | 955 | 74,510 | 962 | |||||||||||||||||||||
1285 Avenue of the Americas |
Mezzanine Loan |
1.3 | % | Fixed | 6.75 | % | Jun-2023 | 55,000 | 710 | 55,429 | 715 | |||||||||||||||||||||
Other |
Mortgage and Mezzanine Loans/Preferred Equity |
1.3 | % | Various | |
5.50 9.61 |
% - % |
|
Oct-2018 to Dec-2027 |
|
190,444 | 2,459 | 190,077 | 2,452 | ||||||||||||||||||
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|
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|
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|
|
|
|||||||||||||||||||||||||
$ | 369,444 | $ | 4,769 | $ | 370,315 | $ | 4,778 | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
Total | Our Share | |||||||
Committed capital |
$ | 775,200 | $ | 10,000 | ||||
Called and/or invested |
(369,950 | ) | (4,772 | ) | ||||
|
|
|
|
|||||
Available to be invested |
$ | 405,250 | $ | 5,228 | ||||
|
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|
|
- 22 -
CAPITAL STRUCTURE | ||
(unaudited and in thousands, except share, unit and per share amounts) |
As of March 31, 2018 | ||||||||||||
Debt: |
||||||||||||
Consolidated debt: |
||||||||||||
Notes and mortgages payable (1) |
$ | 3,599,800 | ||||||||||
$1.0 billion Revolving Credit Facility (2) |
| |||||||||||
|
|
|||||||||||
3,599,800 | ||||||||||||
Less: |
||||||||||||
Noncontrolling interests share of consolidated debt (One Market Plaza and 50 Beale Street) |
(654,342 | ) | ||||||||||
Add: |
||||||||||||
PGREs share of unconsolidated joint venture debt (712 Fifth Avenue, 60 Wall Street, and Oder-Center, Germany) |
180,988 | |||||||||||
|
|
|||||||||||
PGREs share of total debt (3) |
3,126,446 | |||||||||||
|
|
|||||||||||
Shares / Units Outstanding |
Share Price as of March 31, 2018 |
|||||||||||
Equity: |
||||||||||||
Common stock |
240,505,886 | $ | 14.24 | 3,424,804 | ||||||||
Operating Partnership units |
25,307,251 | 14.24 | 360,375 | |||||||||
|
|
|
|
|||||||||
Total equity |
265,813,137 | 14.24 | 3,785,179 | |||||||||
|
|
|
|
|||||||||
Total Market Capitalization |
$ | 6,911,625 | ||||||||||
|
|
(1) | Represents contractual amount due pursuant to the respective debt agreements. |
(2) | On January 10, 2018, we amended and extended our revolving credit facility. The maturity date of our revolving credit facility was extended from November 2018 to January 2022, with two six-month extension options, and the capacity was increased to $1.0 billion from $800 million. |
(3) | See page 35 for our definition of this measure. |
- 23 -
DEBT ANALYSIS |
(unaudited and in thousands)
Total Debt | Fixed Rate Debt | Variable Rate Debt | ||||||||||||||||||||||
Consolidated Debt: | Amount | Rate | Amount | Rate | Amount | Rate | ||||||||||||||||||
1633 Broadway |
$ | 1,046,800 | 3.53 | % | $ | 1,000,000 | 3.54 | % | $ | 46,800 | 3.42 | % | ||||||||||||
1301 Avenue of the Americas |
850,000 | 3.23 | % | 500,000 | 3.05 | % | 350,000 | 3.49 | % | |||||||||||||||
31 West 52nd Street |
500,000 | 3.80 | % | 500,000 | 3.80 | % | | | ||||||||||||||||
One Market Plaza |
975,000 | 4.03 | % | 975,000 | 4.03 | % | | | ||||||||||||||||
50 Beale Street |
228,000 | 3.65 | % | 228,000 | 3.65 | % | | | ||||||||||||||||
Revolving Credit Facility (1) |
| | | | | | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total consolidated debt |
3,599,800 | 3.64 | % | 3,203,000 | 3.66 | % | 396,800 | 3.48 | % | |||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Noncontrolling interests share |
(654,342 | ) | 3.94 | % | (654,342 | ) | 3.94 | % | | | ||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|||||||||||||
PGREs share of consolidated debt (2) |
$ | 2,945,458 | 3.57 | % | $ | 2,548,658 | 3.59 | % | $ | 396,800 | 3.48 | % | ||||||||||||
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|
|||||||||||||
Unconsolidated Joint Venture Debt: |
||||||||||||||||||||||||
712 Fifth Avenue |
$ | 300,000 | 3.39 | % | $ | 300,000 | 3.39 | % | $ | | | |||||||||||||
60 Wall Street |
575,000 | 4.23 | % | | | 575,000 | 4.23 | % | ||||||||||||||||
Oder-Center, Germany |
22,951 | 4.62 | % | 22,951 | 4.62 | % | | | ||||||||||||||||
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|
|||||||||||||
Total unconsolidated debt |
897,951 | 3.96 | % | 322,951 | 3.48 | % | 575,000 | 4.23 | % | |||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Joint venture partners share |
(716,963 | ) | 4.06 | % | (170,771 | ) | 3.54 | % | (546,192 | ) | 4.23 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
PGREs share of unconsolidated debt (2) |
$ | 180,988 | 3.54 | % | $ | 152,180 | 3.41 | % | $ | 28,808 | 4.23 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
PGREs share of Total Debt (2) |
$ | 3,126,446 | 3.57 | % | $ | 2,700,838 | 3.58 | % | $ | 425,608 | 3.53 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) | On January 10, 2018, we amended and extended our revolving credit facility. |
(2) | See page 35 for our definition of this measure. |
(3) | This section presents ratios as of March 31, 2018 in accordance with the terms of our revolving credit facility, which has been filed with the SEC. We are not presenting these ratios and the related calculations for any other purpose or for any other period, and are not intending for these measures to otherwise provide information to investors about our financial condition or results of operations. Investors should not rely on these measures other than for purposes of testing our compliance with the revolving credit facility. |
- 24 -
DEBT MATURITIES |
(unaudited and in thousands)
Consolidated Debt: | 2018 | 2019 | 2020 | 2021 | 2022 | Thereafter | Total | |||||||||||||||||||||
1301 Avenue of the Americas |
$ | | $ | | $ | | $ | 850,000 | $ | | $ | | $ | 850,000 | ||||||||||||||
50 Beale Street |
| | | 228,000 | | | 228,000 | |||||||||||||||||||||
1633 Broadway |
| | | | 1,046,800 | 1,046,800 | ||||||||||||||||||||||
One Market Plaza |
| | | | | 975,000 | 975,000 | |||||||||||||||||||||
31 West 52nd Street |
| | | | | 500,000 | 500,000 | |||||||||||||||||||||
Revolving Credit Facility |
| | | | | | | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total consolidated debt |
| | | 1,078,000 | 1,046,800 | 1,475,000 | 3,599,800 | |||||||||||||||||||||
Noncontrolling interests share |
| | | (157,092 | ) | | (497,250 | ) | (654,342 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
PGREs share of consolidated debt (1) |
$ | | $ | | $ | | $ | 920,908 | $ | 1,046,800 | $ | 977,750 | $ | 2,945,458 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Unconsolidated Joint Venture Debt: |
||||||||||||||||||||||||||||
712 Fifth Avenue |
$ | | $ | | $ | | $ | | $ | | $ | 300,000 | $ | 300,000 | ||||||||||||||
60 Wall Street |
| | | | 575,000 | | 575,000 | |||||||||||||||||||||
Oder-Center, Germany |
| | | | 22,951 | | 22,951 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Total unconsolidated debt |
| | | | 597,951 | 300,000 | 897,951 | |||||||||||||||||||||
Joint venture partners share |
| | | | (566,963 | ) | (150,000 | ) | (716,963 | ) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
PGREs share of unconsolidated debt (1) |
$ | | $ | | $ | | $ | | $ | 30,988 | $ | 150,000 | $ | 180,988 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
PGREs share of total debt (1) |
$ | | $ | | $ | | $ | 920,908 | $ | 1,077,788 | $ | 1,127,750 | $ | 3,126,446 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Weighted average rate |
| | | 3.26 | % | 3.55 | % | 3.84 | % | 3.57 | % | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
% of debt maturing |
| | | 29.5 | % | 34.4 | % | 36.1 | % | 100.0 | % | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
- 25 -
PORTFOLIO SUMMARY | ||
(unaudited and in thousands, except square feet and per square foot amounts) |
Paramount | Square | % | % | Annualized Rent (1) | ||||||||||||||||||||||
Property |
Submarket |
Ownership | Feet | Leased (1) | Occupied (1) | Amount | Per Square Foot (2) | |||||||||||||||||||
As of March 31, 2018 |
||||||||||||||||||||||||||
New York: |
||||||||||||||||||||||||||
1633 Broadway |
West Side | 100.0 | % | 2,518,597 | 95.4 | % | 91.2 | % | $ | 163,677 | $ | 73.00 | ||||||||||||||
1301 Avenue of the Americas |
Sixth Avenue /Rock Center | 100.0 | % | 1,781,571 | 97.9 | % | 97.0 | % | 131,862 | 77.05 | ||||||||||||||||
1325 Avenue of the Americas |
Sixth Avenue /Rock Center | 100.0 | % | 808,998 | 80.9 | % | 80.9 | % | 43,394 | 66.87 | ||||||||||||||||
31 West 52nd Street |
Sixth Avenue /Rock Center | 100.0 | % | 763,140 | 81.5 | % | 77.9 | % | 52,333 | 85.04 | ||||||||||||||||
900 Third Avenue |
East Side | 100.0 | % | 598,903 | 94.7 | % | 94.7 | % | 41,241 | 73.20 | ||||||||||||||||
712 Fifth Avenue |
Madison /Fifth Avenue | 50.0 | % | 543,386 | 93.9 | % | 92.1 | % | 53,296 | 107.00 | ||||||||||||||||
60 Wall Street |
Downtown | 5.0 | % | 1,625,483 | 100.0 | % | 100.0 | % | 73,600 | 45.28 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Subtotal / Weighted average |
8,640,078 | 94.1 | % | 92.2 | % | 559,403 | 70.67 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
PGREs share |
6,824,339 | 92.7 | % | 90.4 | % | 462,842 | 75.77 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Washington, D.C.: |
||||||||||||||||||||||||||
425 Eye Street |
East End | 100.0 | % | 372,552 | 98.7 | % | 98.7 | % | 16,846 | 46.01 | ||||||||||||||||
2099 Pennsylvania Avenue |
CBD | 100.0 | % | 208,776 | 90.6 | % | 90.6 | % | 14,616 | 77.49 | ||||||||||||||||
1899 Pennsylvania Avenue |
CBD | 100.0 | % | 190,955 | 100.0 | % | 100.0 | % | 15,676 | 82.22 | ||||||||||||||||
Liberty Place |
East End | 100.0 | % | 174,090 | 94.9 | % | 93.5 | % | 13,984 | 85.90 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Subtotal / Weighted average |
946,373 | 96.5 | % | 96.2 | % | 61,122 | 67.21 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
PGREs share |
946,373 | 96.5 | % | 96.2 | % | 61,122 | 67.21 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
San Francisco: |
||||||||||||||||||||||||||
One Market Plaza |
South Financial District | 49.0 | % | 1,583,136 | 97.9 | % | 96.3 | % | 114,201 | 74.15 | ||||||||||||||||
One Front Street |
North Financial District | 100.0 | % | 646,759 | 99.5 | % | 89.5 | % | 38,346 | 65.92 | ||||||||||||||||
50 Beale Street |
South Financial District | 31.1 | % | 660,769 | 91.4 | % | 82.6 | % | 31,919 | 58.84 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Subtotal / Weighted average |
2,890,664 | 96.7 | % | 91.7 | % | 184,466 | 69.24 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
PGREs share |
1,627,995 | 97.7 | % | 91.9 | % | 104,231 | 69.25 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Total / Weighted average |
12,477,115 | 94.9 | % | 92.4 | % | $ | 804,991 | $ | 70.06 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
PGREs share |
9,398,707 | 94.0 | % | 91.3 | % | $ | 628,195 | $ | 73.69 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
(2) | Represents office and retail space only. |
- 26 -
SAME STORE LEASED OCCUPANCY | ||
(unaudited) |
As of March 31, 2018 | As of December 31, 2017 | Change in Same Store Leased % |
||||||||||||||||||||||
Property |
Paramount Ownership |
Leased % (1) | Same Store Leased % (1) |
Leased % (1) | Same Store Leased % (1) |
|||||||||||||||||||
New York: |
||||||||||||||||||||||||
1633 Broadway |
100.0 | % | 95.4 | % | 95.4 | % | 95.4 | % | 95.4 | % | | % | ||||||||||||
1301 Avenue of the Americas |
100.0 | % | 97.9 | % | 97.9 | % | 97.9 | % | 97.9 | % | | % | ||||||||||||
1325 Avenue of the Americas |
100.0 | % | 80.9 | % | 80.9 | % | 80.9 | % | 80.9 | % | | % | ||||||||||||
31 West 52nd Street |
100.0 | % | 81.5 | % | 81.5 | % | 78.0 | % | 78.0 | % | 3.5 | % | ||||||||||||
900 Third Avenue |
100.0 | % | 94.7 | % | 94.7 | % | 94.7 | % | 94.7 | % | | % | ||||||||||||
712 Fifth Avenue |
50.0 | % | 93.9 | % | 93.9 | % | 95.1 | % | 95.1 | % | (1.2 | %) | ||||||||||||
60 Wall Street |
5.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Weighted average |
94.1 | % | 94.1 | % | 93.8 | % | 93.8 | % | 0.3 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
PGREs share |
92.7 | % | 92.7 | % | 92.4 | % | 92.4 | % | 0.3 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Washington, D.C.: |
||||||||||||||||||||||||
425 Eye Street |
100.0 | % | 98.7 | % | 98.7 | % | 98.7 | % | 98.7 | % | | % | ||||||||||||
2099 Pennsylvania Avenue |
100.0 | % | 90.6 | % | 90.6 | % | 88.9 | % | 88.9 | % | 1.7 | % | ||||||||||||
1899 Pennsylvania Avenue |
100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | | % | ||||||||||||
Liberty Place |
100.0 | % | 94.9 | % | 94.9 | % | 94.9 | % | 94.9 | % | | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Weighted average |
96.5 | % | 96.5 | % | 96.1 | % | 96.1 | % | 0.4 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
PGREs share |
96.5 | % | 96.5 | % | 96.1 | % | 96.1 | % | 0.4 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
San Francisco: |
||||||||||||||||||||||||
One Market Plaza |
49.0 | % | 97.9 | % | 97.9 | % | 97.7 | % | 97.7 | % | 0.2 | % | ||||||||||||
One Front Street |
100.0 | % | 99.5 | % | 99.5 | % | 99.3 | % | 99.3 | % | 0.2 | % | ||||||||||||
50 Beale Street |
31.1 | % | 91.4 | % | 91.4 | % | 82.6 | % | 82.6 | % | 8.8 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Weighted average |
96.7 | % | 96.7 | % | 94.6 | % | 94.6 | % | 2.1 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
PGREs share |
97.7 | % | 97.7 | % | 96.4 | % | 96.4 | % | 1.3 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Weighted average |
94.9 | % | 94.9 | % | 94.2 | % | 94.2 | % | 0.7 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
PGREs share |
94.0 | % | 94.0 | % | 93.5 | % | 93.5 | % | 0.5 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
- 27 -
TOP TENANTS AND INDUSTRY DIVERSIFICATION | ||
(unaudited and in thousands, except square feet and per square foot amounts) |
PGREs Share of | ||||||||||||||||||||||||||||||||
Top 10 Tenants: | Property | Lease Expiration |
Total Square Feet Occupied |
Total Square Feet Occupied |
% of Total Square Feet |
Annualized Rent (1) | % of Annualized Rent |
|||||||||||||||||||||||||
Amount | Per Square Foot |
|||||||||||||||||||||||||||||||
As of March 31, 2018 |
||||||||||||||||||||||||||||||||
Barclays Capital, Inc. |
|
1301 Avenue of the Americas & 2099 Pennsylvania Avenue |
|
Dec-2020 | (2) | 500,790 | (2) | 500,790 | (2) | 5.3 | % | $ | 32,407 | $ | 64.71 | 5.2 | % | |||||||||||||||
Allianz Global Investors, LP |
1633 Broadway | Jan-2031 | 320,911 | 320,911 | 3.4 | % | 28,177 | 87.80 | 4.5 | % | ||||||||||||||||||||||
Credit Agricole Corporate & Investment Bank |
1301 Avenue of the Americas | Feb-2023 | 312,679 | 312,679 | 3.3 | % | 26,740 | 85.52 | 4.3 | % | ||||||||||||||||||||||
Clifford Chance LLP |
31 West 52nd Street | Jun-2024 | 328,992 | 328,992 | 3.5 | % | 26,218 | 79.69 | 4.2 | % | ||||||||||||||||||||||
Norton Rose Fulbright |
1301 Avenue of the Americas | Sep-2034 | (3) | 320,325 | (3) | 320,325 | (3) | 3.4 | % | 25,323 | 79.05 | 4.0 | % | |||||||||||||||||||
Morgan Stanley & Company |
1633 Broadway | Mar-2032 | 260,829 | 260,829 | 2.8 | % | 19,108 | 73.26 | 3.0 | % | ||||||||||||||||||||||
WMG Acquisition Corp. (Warner Music Group) |
1633 Broadway | Jul-2029 | 293,888 | 293,888 | 3.1 | % | 16,939 | 57.64 | 2.7 | % | ||||||||||||||||||||||
Showtime Networks, Inc. |
1633 Broadway | Jan-2026 | 238,880 | 238,880 | 2.5 | % | 14,394 | 60.26 | 2.3 | % | ||||||||||||||||||||||
Kasowitz Benson Torres & Friedman, LLP |
1633 Broadway | Mar-2037 | 203,394 | 203,394 | 2.2 | % | 14,338 | 70.49 | 2.3 | % | ||||||||||||||||||||||
U.S. General Services Administration |
425 Eye Street | Jun-2021 | (4) | 310,450 | (4) | 310,450 | (4) | 3.3 | % | 14,332 | 46.17 | 2.3 | % |
PGREs Share of | ||||||||||||||||
Industry Diversification: | Square Feet Occupied |
% of Occupied Square Feet |
Annualized Rent (1) |
% of Annualized Rent |
||||||||||||
As of March 31, 2018 |
||||||||||||||||
Legal Services |
1,898,367 | 22.3 | % | $ | 146,656 | 23.3 | % | |||||||||
Financial Services - Commercial and Investment Banking |
1,759,525 | 20.7 | % | 128,149 | 20.4 | % | ||||||||||
Technology and Media |
1,484,239 | 17.4 | % | 98,810 | 15.7 | % | ||||||||||
Financial Services, all others |
931,297 | 10.9 | % | 79,127 | 12.6 | % | ||||||||||
Insurance |
554,680 | 6.5 | % | 44,049 | 7.0 | % | ||||||||||
Retail |
276,511 | 3.3 | % | 22,060 | 3.5 | % | ||||||||||
Government |
345,278 | 4.1 | % | 16,872 | 2.7 | % | ||||||||||
Real Estate |
228,000 | 2.7 | % | 15,701 | 2.5 | % | ||||||||||
Consumer Products |
192,620 | 2.3 | % | 14,795 | 2.4 | % | ||||||||||
Other |
836,474 | 9.8 | % | 61,976 | 9.9 | % |
(1) | See page 35 for our definition of this measure. |
(2) | 3,372 square feet leased at 2099 Pennsylvania Avenue expires on June 30, 2023. |
(3) | 116,462 of the square feet leased expires on March 31, 2032. |
(4) | 14,312 of the square feet leased expires on August 7, 2022. |
- 28 -
LEASING ACTIVITY | ||
(unaudited) |
Total | New York | Washington, D.C. | San Francisco | |||||||||||||
Three Months Ended March 31, 2018 |
||||||||||||||||
Total square feet leased |
285,167 | 145,340 | 3,262 | 136,565 | ||||||||||||
PGREs share of total square feet leased: |
216,848 | 142,077 | 3,262 | 71,509 | ||||||||||||
Initial rent (1) |
$ | 86.32 | $ | 89.68 | $ | 58.50 | $ | 80.90 | ||||||||
Weighted average lease term (in years) |
8.3 | 9.5 | 3.4 | 6.1 | ||||||||||||
Tenant improvements and leasing commissions: |
||||||||||||||||
Per square foot |
$ | 65.23 | $ | 67.55 | $ | 11.07 | $ | 63.09 | ||||||||
Per square foot per annum |
$ | 7.88 | $ | 7.14 | $ | 3.24 | $ | 10.28 | ||||||||
Percentage of initial rent |
9.1 | % | 8.0 | % | 5.5 | % | 12.7 | % | ||||||||
Rent concessions: |
||||||||||||||||
Average free rent period (in months) |
5.1 | 6.7 | 1.0 | 1.9 | ||||||||||||
Average free rent period per annum (in months) |
0.6 | 0.7 | 0.3 | 0.3 | ||||||||||||
Second generation space: (1) |
||||||||||||||||
Square feet |
161,215 | 107,798 | | 53,417 | ||||||||||||
GAAP basis: |
||||||||||||||||
Straight-line rent |
$ | 85.76 | $ | 86.45 | $ | | $ | 84.36 | ||||||||
Prior straight-line rent |
$ | 75.93 | $ | 81.24 | $ | | $ | 65.22 | ||||||||
Percentage increase |
12.9 | % | 6.4 | % | | 29.3 | % | |||||||||
Cash basis |
||||||||||||||||
Initial rent (1) |
$ | 88.36 | $ | 90.75 | $ | | $ | 83.55 | ||||||||
Prior escalated rent |
$ | 75.01 | $ | 82.01 | $ | | $ | 60.89 | ||||||||
Percentage increase |
17.8 | % | 10.7 | % | | 37.2 | % |
(1) | See page 35 for our definition of this measure. |
- 29 -
LEASE EXPIRATIONS - TOTAL PORTFOLIO |
(unaudited and in thousands, except square feet and per square foot amounts)
Total | PGREs Share of | |||||||||||||||||||
Year of | Square Feet | Square Feet | Annualized Rent (1) | % of | ||||||||||||||||
Lease Expiration (2) |
of Expiring Leases | of Expiring Leases | Amount | Per Square Foot (3) | Annualized Rent | |||||||||||||||
Month to Month |
9,080 | 6,304 | $ | 346 | $ | 58.44 | 0.1 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
2Q 2018 |
38,244 | 20,058 | 1,847 | 102.45 | 0.3 | % | ||||||||||||||
3Q 2018 |
28,259 | 25,082 | 1,886 | 81.51 | 0.3 | % | ||||||||||||||
4Q 2018 |
58,072 | 48,223 | 4,670 | 96.84 | 0.7 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2018 |
124,575 | 93,363 | 8,403 | 94.08 | 1.3 | % | ||||||||||||||
1Q 2019 |
195,117 | 176,229 | 13,752 | 77.92 | 2.1 | % | ||||||||||||||
Remaining 2019 |
414,476 | 339,250 | 26,246 | 77.88 | 4.1 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2019 |
609,593 | 515,479 | 39,998 | 77.90 | 6.2 | % | ||||||||||||||
2020 |
701,796 | 427,569 | 30,566 | 70.48 | 4.7 | % | ||||||||||||||
2021 |
1,629,138 | 1,411,830 | 89,925 | 64.53 | 13.9 | % | ||||||||||||||
2022 |
2,392,602 | 570,911 | 41,312 | 76.16 | 6.4 | % | ||||||||||||||
2023 |
760,456 | 696,822 | 54,540 | 81.43 | 8.4 | % | ||||||||||||||
2024 |
751,240 | 694,225 | 53,638 | 77.46 | 8.3 | % | ||||||||||||||
2025 |
1,006,548 | 688,820 | 51,147 | 74.31 | 7.9 | % | ||||||||||||||
2026 |
753,857 | 667,240 | 49,178 | 70.61 | 7.6 | % | ||||||||||||||
2027 |
125,471 | 117,455 | 9,529 | 81.15 | 1.5 | % | ||||||||||||||
Thereafter |
2,927,261 | 2,901,512 | 220,529 | 75.60 | 33.7 | % |
(1) | See page 35 for our definition of this measure. |
(2) | Leases that expire on the last day of the quarter are treated as occupied and are reflected as expiring space in the following quarter. |
(3) | Represents office and retail space only. |
- 30 -
LEASE EXPIRATIONS - NEW YORK | ||
(unaudited and in thousands, except square feet and per square foot amounts) |
Total Square Feet of Expiring Leases |
PGREs Share of | |||||||||||||||||||
Year of Lease Expiration (2) |
Square Feet of Expiring Leases |
Annualized Rent (1) | % of | |||||||||||||||||
Amount | Per Square Foot (3) | Annualized Rent | ||||||||||||||||||
Month to Month |
1,322 | 1,322 | $ | 140 | $ | | 0.0 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
2Q 2018 |
35,320 | 19,053 | 1,777 | 104.48 | 0.4 | % | ||||||||||||||
3Q 2018 |
2,680 | 1,340 | 163 | 101.82 | 0.0 | % | ||||||||||||||
4Q 2018 |
48,886 | 39,037 | 4,259 | 109.11 | 0.8 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2018 |
86,886 | 59,430 | 6,199 | 107.61 | 1.2 | % | ||||||||||||||
1Q 2019 |
110,040 | 101,866 | 8,914 | 87.30 | 1.9 | % | ||||||||||||||
Remaining 2019 |
222,606 | 213,604 | 17,608 | 84.69 | 3.7 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2019 |
332,646 | 315,470 | 26,522 | 85.56 | 5.6 | % | ||||||||||||||
2020 |
283,899 | 244,740 | 18,420 | 75.27 | 3.9 | % | ||||||||||||||
2021 |
958,624 | 910,899 | 62,732 | 71.00 | 13.2 | % | ||||||||||||||
2022 |
1,786,888 | 231,932 | 14,396 | 66.98 | 3.0 | % | ||||||||||||||
2023 |
543,278 | 514,325 | 39,503 | 80.92 | 8.3 | % | ||||||||||||||
2024 |
573,139 | 552,063 | 42,888 | 77.90 | 9.0 | % | ||||||||||||||
2025 |
132,220 | 99,418 | 8,633 | 86.83 | 1.8 | % | ||||||||||||||
2026 |
581,223 | 566,078 | 41,951 | 70.47 | 8.8 | % | ||||||||||||||
2027 |
85,378 | 85,378 | 7,079 | 82.91 | 1.5 | % | ||||||||||||||
Thereafter |
2,741,997 | 2,728,625 | 208,392 | 75.92 | 43.7 | % |
(1) | See page 35 for our definition of this measure. |
(2) | Leases that expire on the last day of the quarter are treated as occupied and are reflected as expiring space in the following quarter. |
(3) | Represents office and retail space only. |
- 31 -
LEASE EXPIRATIONS - WASHINGTON, D.C. | ||
(unaudited and in thousands, except square feet and per square foot amounts) |
Total Square Feet of Expiring Leases |
PGREs Share of | |||||||||||||||||||
Year of Lease Expiration (2) |
Square Feet of Expiring Leases |
Annualized Rent (1) | % of | |||||||||||||||||
Amount | Per Square Foot (3) | Annualized Rent | ||||||||||||||||||
Month to Month |
| | $ | | $ | | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
2Q 2018 |
| | | | | |||||||||||||||
3Q 2018 |
| | | | | |||||||||||||||
4Q 2018 |
| | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2018 |
| | | | | |||||||||||||||
1Q 2019 |
34,475 | 34,475 | 2,665 | 77.31 | 4.4 | % | ||||||||||||||
Remaining 2019 |
7,606 | 7,606 | 924 | 88.57 | 1.5 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2019 |
42,081 | 42,081 | 3,589 | 79.31 | 5.9 | % | ||||||||||||||
2020 |
33,136 | 33,136 | 2,634 | 79.49 | 4.3 | % | ||||||||||||||
2021 |
317,416 | 317,416 | 15,656 | 47.78 | 25.7 | % | ||||||||||||||
2022 |
38,919 | 38,919 | 2,531 | 65.03 | 4.2 | % | ||||||||||||||
2023 |
149,178 | 149,178 | 12,505 | 84.45 | 20.5 | % | ||||||||||||||
2024 |
78,811 | 78,811 | 6,287 | 79.91 | 10.3 | % | ||||||||||||||
2025 |
56,565 | 56,565 | 4,687 | 82.85 | 7.7 | % | ||||||||||||||
2026 |
32,011 | 32,011 | 2,261 | 70.65 | 3.7 | % | ||||||||||||||
2027 |
24,373 | 24,373 | 1,941 | 79.62 | 3.2 | % | ||||||||||||||
Thereafter |
123,873 | 123,873 | 8,873 | 71.63 | 14.5 | % |
(1) | See page 35 for our definition of this measure. |
(2) | Leases that expire on the last day of the quarter are treated as occupied and are reflected as expiring space in the following quarter. |
(3) | Represents office and retail space only. |
-32-
LEASE EXPIRATIONS - SAN FRANCISCO | ||
(unaudited and in thousands, except square feet and per square foot amounts) |
Total Square Feet of Expiring Leases |
PGREs Share of | |||||||||||||||||||
Year of Lease Expiration (2) |
Square Feet of Expiring Leases |
Annualized Rent (1) | % of Annualized Rent |
|||||||||||||||||
Amount | Per Square Foot (3) | |||||||||||||||||||
Month to Month |
7,758 | 4,982 | $ | 206 | $ | 58.44 | 0.2 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
2Q 2018 |
2,924 | 1,005 | 70 | 69.65 | 0.1 | % | ||||||||||||||
3Q 2018 |
25,579 | 23,742 | 1,723 | 80.20 | 1.5 | % | ||||||||||||||
4Q 2018 |
9,186 | 9,186 | 411 | 44.70 | 0.4 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2018 |
37,689 | 33,933 | 2,204 | 69.31 | 2.0 | % | ||||||||||||||
1Q 2019 |
50,602 | 39,888 | 2,173 | 54.49 | 2.0 | % | ||||||||||||||
Remaining 2019 |
184,264 | 118,040 | 7,714 | 65.37 | 6.9 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total 2019 |
234,866 | 157,928 | 9,887 | 62.61 | 8.9 | % | ||||||||||||||
2020 |
384,761 | 149,693 | 9,512 | 60.53 | 8.5 | % | ||||||||||||||
2021 |
353,098 | 183,515 | 11,537 | 62.86 | 10.4 | % | ||||||||||||||
2022 |
566,795 | 300,060 | 24,385 | 81.34 | 21.9 | % | ||||||||||||||
2023 |
68,000 | 33,319 | 2,532 | 75.25 | 2.3 | % | ||||||||||||||
2024 |
99,290 | 63,351 | 4,463 | 70.58 | 4.0 | % | ||||||||||||||
2025 |
817,763 | 532,837 | 37,827 | 71.06 | 34.0 | % | ||||||||||||||
2026 |
140,623 | 69,151 | 4,966 | 71.75 | 4.5 | % | ||||||||||||||
2027 |
15,720 | 7,704 | 509 | 66.36 | 0.5 | % | ||||||||||||||
Thereafter |
61,391 | 49,014 | 3,264 | 67.27 | 2.8 | % |
(1) | See page 35 for our definition of this measure. |
(2) | Leases that expire on the last day of the quarter are treated as occupied and are reflected as expiring space in the following quarter. |
(3) | Represents office and retail space only. |
-33-
CASH BASIS CAPITAL EXPENDITURES | ||
(unaudited and in thousands) |
Three Months Ended March 31, 2018 | ||||||||||||||||||||
Total | New York | Washington, D.C | San Francisco | Other | ||||||||||||||||
Capital expenditures: (1) |
||||||||||||||||||||
Expenditures to maintain assets |
$ | 3,702 | $ | 2,903 | $ | 235 | $ | 463 | $ | 101 | ||||||||||
Second generation tenant improvements |
13,499 | 12,610 | 34 | 855 | | |||||||||||||||
Second generation leasing commissions |
1,484 | 583 | 142 | 759 | | |||||||||||||||
First generation leasing costs and other capital expenditures |
4,654 | 111 | 2,059 | 2,484 | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Capital Expenditures |
$ | 23,339 | $ | 16,207 | $ | 2,470 | $ | 4,561 | $ | 101 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Redevelopment Expenditures (1) |
||||||||||||||||||||
31 West 52nd Street (Lobby Renovation) |
$ | 2,964 | $ | 2,964 | $ | | $ | | $ | | ||||||||||
One Market Plaza (Elevator Modernization) |
754 | | | 754 | | |||||||||||||||
Other |
587 | 587 | | | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Redevelopment Expenditures |
$ | 4,305 | $ | 3,551 | $ | | $ | 754 | $ | | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Three Months Ended March 31, 2017 | ||||||||||||||||||||
Total | New York | Washington, D.C | San Francisco | Other | ||||||||||||||||
Capital expenditures: (1) |
||||||||||||||||||||
Expenditures to maintain assets |
$ | 5,555 | $ | 3,297 | $ | 466 | $ | 1,705 | $ | 87 | ||||||||||
Second generation tenant improvements |
3,957 | 2,487 | | 1,470 | | |||||||||||||||
Second generation leasing commissions |
3,451 | 3,213 | | 238 | | |||||||||||||||
First generation leasing costs and other capital expenditures |
5,566 | 2,816 | 1,226 | 1,524 | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Capital Expenditures |
$ | 18,529 | $ | 11,813 | $ | 1,692 | $ | 4,937 | $ | 87 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Redevelopment Expenditures (1) |
||||||||||||||||||||
Residential Development Fund |
$ | 1,437 | $ | | $ | | $ | | $ | 1,437 | ||||||||||
Other |
452 | 375 | | 77 | | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Redevelopment Expenditures |
$ | 1,889 | $ | 375 | $ | | $ | 77 | $ | 1,437 | ||||||||||
|
|
|
|
|
|
|
|
|
|
(1) | See page 35 for our definition of this measure. |
- 34 -
DEFINITIONS |
We use and present various non-GAAP measures in this Supplemental Operating and Financial Data report. The following section contains definitions of these measures, describes our use of them and provides information regarding why we believe they are meaningful. Other real estate companies may use different methodologies for calculating these measures, and accordingly, our presentation of these measures may not be comparable to other real estate companies. These non-GAAP measures should not be considered a substitute for, and should only be considered together with and as a supplement to, financial information presented in accordance with GAAP.
Funds from Operations (FFO) is a supplemental measure of our performance. FFO is presented in accordance with the definition adopted by the National Association of Real Estate Investment Trusts (Nareit). Nareit defines FFO as GAAP net income or loss adjusted to exclude net gains from sales of depreciated real estate assets, impairment losses on depreciable real estate and depreciation and amortization expense from real estate assets, including our share of such adjustments of unconsolidated joint ventures. FFO is commonly used in the real estate industry to assist investors and analysts in comparing results of real estate companies because it excludes the effect of real estate depreciation and amortization and net gain on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. FFO is not intended to be a measure of cash flow or liquidity. FFO attributable to common stockholders represents the Companys share of FFO that is attributable to common stockholders and is calculated by reducing from FFO, the noncontrolling interests share of FFO in consolidated joint ventures, real estate funds and Operating Partnership.
Core Funds from Operations (Core FFO) is an alternative measure of our operating performance, which adjusts FFO for certain other items that we believe enhance the comparability of our FFO across periods. Core FFO, when applicable, excludes the impact of certain items, including, transaction related costs, realized and unrealized gains or losses on real estate fund investments, unrealized gains or losses on interest rate swaps, severance costs and gains or losses on early extinguishment of debt, in order to reflect the Core FFO of our real estate portfolio and operations. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results. Core FFO is not intended to be a measure of cash flow or liquidity. Core FFO attributable to common stockholders represents the Companys share of Core FFO that is attributable to common stockholders and is calculated by reducing from Core FFO, the noncontrolling interests share of Core FFO in consolidated joint ventures, real estate funds and Operating Partnership.
Funds Available for Distribution (FAD) is a supplemental measure of our operating performance and is calculated as Core FFO adjusted for (i) capital expenditures to maintain assets, (ii) tenant improvements and leasing commissions incurred for second generation leases, (iii) straight-line rent adjustments, (iv) amortization of above and below-market leases, net, (v) amortization of stock-based compensation expense and (vi) amortization of deferred financing costs. FAD is commonly used in the real estate industry along with cash flow from operating activities as a measure of the ability to generate cash from operations and the ability to fund cash needs and make distributions to our stockholders. FAD provides information regarding our operating performance that would not otherwise be available and is useful to investors and analysts in assessing our operating performance. Additionally, although FAD is not intended to be a liquidity measure, as it does not make adjustments for the changes in working capital, we believe that FAD may provide investors and analysts with useful supplemental information regarding our ability to generate cash from operations and our ability to make distributions to our stockholders. Furthermore, we believe that FAD is frequently used by investors and analysts in evaluating our performance as a REIT. FAD attributable to common stockholders represents the Companys share of FAD that is attributable to common stockholders and is calculated by reducing from FAD, the noncontrolling interests share of FAD in consolidated joint ventures, real estate funds and Operating Partnership.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre) is a supplemental measure of our operating performance. EBITDAre is presented in accordance with the definition adopted by Nareit. Nareit defines EBITDAre as GAAP net income (loss) adjusted to exclude interest expense, income taxes, depreciation and amortization expenses, net gains from sales of depreciated real estate assets and impairment losses on depreciable real estate, including our share of such adjustments of unconsolidated joint ventures. EBITDAre provides information regarding our operating performance that would not otherwise be available and may be useful to an investor in assessing our ability to incur and service debt. EBITDAre should not be considered as an indication of our financial performance or a measure of our cash flow or liquidity. We also present PGREs share of EBITDAre which represents our share of EBITDAre generated by our consolidated and unconsolidated joint ventures, based on our percentage ownership in the underlying assets.
- 35 -
DEFINITIONS - CONTINUED |
Adjusted EBITDAre is a supplemental measure that is calculated by adjusting EBITDAre to eliminate the impact of the performance of our real estate funds, unrealized gains or losses on interest rate swaps, transaction related costs, gains or losses on early extinguishment of debt and certain other items that may vary from period to period. Adjusted EBITDAre enhances the comparability of EBITDAre across periods. In future periods, we may also exclude other items from Adjusted EBITDAre that we believe may help investors compare our results. We also present PGREs share of Adjusted EBITDAre, which represents our share of Adjusted EBITDAre generated by our consolidated and unconsolidated joint ventures based on our percentage ownership in the underlying assets.
Net Operating Income (NOI) is used to measure the operating performance of our properties. NOI consists of property-related revenue (which includes rental income, tenant reimbursement income and certain other income) less operating expenses (which includes building expenses such as cleaning, security, repairs and maintenance, utilities, property administration and real estate taxes). We also present Cash NOI which deducts from NOI, straight-line rent adjustments and the amortization of above and below-market leases, net, including our share of such adjustments of unconsolidated joint ventures. In addition, we present PGREs share of NOI and Cash NOI which represents our share of NOI and Cash NOI of consolidated and unconsolidated joint ventures, based on our percentage ownership in the underlying assets. We use NOI and Cash NOI internally as performance measures and believe they provide useful information to investors regarding our financial condition and results of operations because they reflect only those income and expense items that are incurred at property level.
Same Store NOI is used to measure the operating performance of properties that were owned by us in a similar manner during both the current period and prior reporting periods, and represents Same Store NOI from consolidated and unconsolidated joint ventures based on our percentage ownership in the underlying assets. Same Store NOI also excludes lease termination income, bad debt expense and certain other items that may vary from period to period. We also present Same Store Cash NOI, which excludes the effect of non-cash items such as the straight-lining of rental revenue and the amortization of above and below-market leases.
PGREs Share of Total Debt represents our share of debt of consolidated and unconsolidated joint ventures, based on our percentage ownership in the underlying assets. We believe that PGREs share of total debt provides useful information to investors regarding our financial condition because it includes our share of debt from unconsolidated joint ventures and excludes the noncontrolling interests share of debt from consolidated joint ventures that is attributable to our partners.
Annualized Rent represents the end of period monthly base rent plus escalations in accordance with the lease terms, multiplied by 12.
Leased % represents percentage of square feet that is leased, including signed leases not yet commenced.
Same Store Leased % represents percentage of square feet that is leased, including signed leases not yet commenced, for properties that were owned by us in a similar manner during both the current period and prior reporting periods.
Occupied % represents the percentage of space for which we have commenced rental revenue in accordance with GAAP.
Initial Rent represents the weighted average cash basis starting rent per square foot and does not include free rent or periodic step-ups in rent.
Prior Escalated Rent represents the weighted average cash basis rent (including reimbursements) per square foot at expiration.
Second Generation Space represents space leased that has been vacant for less than twelve months.
Capital Expenditures consist of expenditures to maintain assets, tenant improvement allowances and leasing commissions. Expenditures to Maintain Assets include capital expenditures to maintain current revenues. Second Generation Tenant Improvements and Leasing Commissions represent tenant improvements and leasing commissions incurred in leasing second generation space. First Generation Leasing Costs and Other Capital Expenditures include capital expenditures completed in the year of acquisition and the following two years that were planned at the time of acquisition, as well as tenant improvements and leasing commissions on space leased that has been vacant for more than twelve months. Development Expenditures consist of hard and soft costs related to the development of a property in getting it ready for its intended use.
- 36 -
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