EX-99.1 2 a8-kpressreleaseex9912q17.htm EXHIBIT 99.1 Exhibit


                                    
cousinslogoa12.jpg
Earnings Release
CONTACT:            
Gregg D. Adzema
 
Marli Quesinberry
Executive Vice President and
 
Vice President, Investor Relations and
Chief Financial Officer
 
Corporate Communications
(404) 407-1116
 
(404) 407-1898
greggadzema@cousinsproperties.com
 
marliquesinberry@cousinsproperties.com
COUSINS PROPERTIES REPORTS SECOND QUARTER 2017 RESULTS
Highlights
•
Net income available to common stockholders for the second quarter was $0.40 per share.
•
Funds From Operations for the second quarter was $0.16 per share.
•
Same property net operating income on a cash basis increased 8.6% during the second quarter.
•
Legacy Parkway same property net operating income on a cash basis increased 11.7% during the second quarter.
•
Second generation net rent per square foot on a cash basis increased 13.5% during the second quarter.
•
Leased or renewed 341,008 square feet of office space during the second quarter.
•
Sold Emory Point I and II in May for a combined gross sales price of $199 million and The American Cancer Society Center in June for a gross sales price of $166 million.
•
Commenced operations at 8000 Avalon, which was 73.1% leased as of June 30, 2017.
•
Closed a $350 million private placement of senior unsecured debt, which was issued in two tranches. The first tranche of $100 million was issued in April, has a 10-year maturity and a fixed rate of 4.09%. The second tranche of $250 million was issued in July, has an 8-year maturity and a fixed rate of 3.91%.
•
During the quarter and subsequent to quarter-end, repaid four mortgage notes totaling $359 million that were assumed in the Parkway merger.
ATLANTA (July 27, 2017) - Cousins Properties Incorporated (NYSE:CUZ) today reported its results of operations for the quarter ended June 30, 2017.
“Our Sun Belt office markets remain healthy and our urban portfolio continues to perform well, with same-property cash NOI up 8.6% and second generation cash rents up 13.5%,” said Larry Gellerstedt, president and chief executive officer of Cousins Properties. “With the successful delivery of 8000 Avalon this quarter, our newest Atlanta Class A office building, our development efforts continue to create significant value for our shareholders.”
Financial Results
Net income available to common stockholders was $168.1 million, or $0.40 per share, for the second quarter of 2017, compared with $7.8 million, or $0.04 per share, for the second quarter of 2016. Net income available to common stockholders was $172.8 million, or $0.42 per share, for the six months ended June 30, 2017, compared with $30.6 million, or $0.15 per share, for the six months ended June 30, 2016.
Funds From Operations ("FFO") was $66.4 million, or $0.16 per share, for the second quarter of 2017, compared with $43.3 million, or $0.21 per share, for the second quarter of 2016. FFO was $133.4 million, or $0.32 per share, for the six months ended June 30, 2017, compared with $86.7 million, or $0.41 per share, for the six months ended June 30, 2016.
2017 FFO Guidance
Based on second quarter 2017 results, the Company has narrowed its full year 2017 net income guidance from $0.41 to $0.49 per share to $0.43 to $0.48 per share. The Company's full year 2017 FFO guidance of $0.58 to $0.63 remains unchanged.
The Company leaves unchanged previously provided components of its full year 2017 net income and FFO guidance, except for the following updates:




•
Fee and other income of $18.5 million to $20.5 million, up from the previous range of $15 million to $17 million, due to $3 million of termination fees recorded during the second quarter, as well as an additional $500,000 anticipated during the balance of 2017.
•
General and administrative costs of $26 million to $28 million, up from the previous range of $23 million to $25 million, primarily due to an increase in long-term incentive compensation expense driven by improved total stockholder return relative to the SNL US REIT Office index.
A reconciliation of projected net income per share to projected FFO per share is provided as follows:
 
Full Year 2017 Range
 
Low
 
High
Net income per share
$
0.43

 
$
0.48

Add: Real estate depreciation and amortization
0.51

 
0.51

Less: Gain on sale of real estate assets
(0.36
)
 
(0.36
)
Funds From Operations per share
$
0.58

 
$
0.63

This guidance is provided for information purposes based on current plans and assumptions and is subject to change.
Investor Conference Call and Webcast
The Company will conduct a conference call at 10:00 a.m. (Eastern Time) on Friday, July 28, 2017, to discuss the results of the quarter ended June 30, 2017. The number to call for this interactive teleconference is (877) 247-1056.
A replay of the conference call will be available for 7 days by dialing (877) 344-7529 and entering the passcode 10109090. The replay can be accessed on the Company's website, www.cousinsproperties.com, through the “Cousins Properties Incorporated Second Quarter 2017 Conference Call” link on the Investor Relations page.
A copy of Cousins Properties' second quarter 2017 Supplemental Information can be found in the Investor Relations section of the Company's website at www.cousinsproperties.com. The information in this update is for informational purposes based on current plans and assumptions and is subject to change. The Company undertakes no obligation to update this information.
Acting through its operating partnership Cousins Properties, LP, Cousins Properties is a leading fully-integrated real estate investment trust (REIT) with extensive experience in development, acquisition, financing, management, and leasing. Based in Atlanta, the Company actively invests in top-tier urban office assets and opportunistic mixed-use properties in Sunbelt markets.
Certain matters contained in this press release are "non-GAAP financial measures." The condensed consolidated statements of operations, condensed consolidated balance sheets, a schedule entitled Funds From Operations, which reconciles net income to FFO, and a schedule entitled Same Property Information, which reconciles cash basis same property net operating income to net income, are attached to this press release. The change in second generation net rent per square foot on a cash basis represents the aggregate net rent (base rent less operating expense reimbursements and leasing costs) paid by prior tenants compared to the aggregate net rent paid by current tenants for spaces that have been re-leased in the office portfolio. Second generation leases exclude leases executed for spaces that were vacant upon acquisition, new leases in a development property, and leases for spaces that have been vacant for one year or more. More detailed information on net income and FFO is included in the “Net Income and Funds From Operations - Supplemental Detail” schedule, which is included along with other supplemental information in the Company’s Current Report on Form 8-K, which the Company is furnishing to the Securities and Exchange Commission (“SEC”), and which can be viewed through the “Supplemental Information” and “SEC Filings” links on the “Investor Information & Filings” link of the Investor Relations page of the Company’s website at www.cousinsproperties.com. This information may also be obtained by calling the Company’s Investor Relations Department at (404) 407-1898.
Certain matters contained in this report are “forward-looking statements” within the meaning of the federal securities laws and are subject to uncertainties and risks, as itemized in Item 1A included in the Annual Report on Form 10-K for the year ended December 31, 2016 and in the Quarterly Report on Form 10-Q for the three months ended June 30, 2017. These forward-looking statements include information about possible or assumed future results of the business and our financial condition, liquidity, results of operations, plans, and objectives. They also include, among other things, statements regarding subjects that are forward-looking by their nature, such as, our business and financial strategy; our ability to obtain future financing; future acquisitions and dispositions of operating assets; future acquisitions of land; future development and redevelopment opportunities; future dispositions of land and other non-core assets; future repurchases of common stock; projected operating results; market and industry trends; future distributions; projected capital expenditures; interest rates; the impact of the transactions involving the Company, Parkway Properties Inc. ("Parkway"), and Parkway, Inc. ("New Parkway"); future financial and operating results, plans, objectives,




expectations, and intentions; all statements that address operating performance, events, or developments that management expects or anticipates will occur in the future — including statements relating to creating value for stockholders; impact of the transactions with Parkway and New Parkway on tenants, employees, stockholders, and other constituents of the combined companies; and integrating Parkway with us.
Any forward-looking statements are based upon management's beliefs, assumptions, and expectations of our future performance, taking into account information currently available. These beliefs, assumptions, and expectations may change as a result of possible events or factors, not all of which are known. If a change occurs, our business, financial condition, liquidity, and results of operations may vary materially from those expressed in forward-looking statements. Actual results may vary from forward-looking statements due to, but not limited to, the following: the availability and terms of capital; the ability to refinance or repay indebtedness as it matures; the failure of purchase, sale, or other contracts to ultimately close; the failure to achieve anticipated benefits from acquisitions, investments or dispositions; the potential dilutive effect of common stock or operating partnership unit issuances; the failure to achieve benefits from the repurchase of common stock; the availability of buyers and adequate pricing with respect to the disposition of assets; risks and uncertainties related to national and local economic conditions, the real estate industry, and the commercial real estate markets in which we operate, particularly in Atlanta, Charlotte, and Austin where we have high concentrations of our annualized lease revenue; changes to our strategy with regard to land and other non-core holdings that may require impairment losses to be recognized; leasing risks, including the ability to obtain new tenants or renew expiring tenants, and the ability to lease newly developed and/or recently acquired space, and the risk of declining leasing rates; the adverse change in the financial condition of one or more of our major tenants; volatility in interest rates and insurance rates; the risks associated with real estate developments (such as zoning approval, receipt of required permits, construction delays, cost overruns, and leasing risk); the loss of key personnel; the potential liability for uninsured losses, condemnation, or environmental issues; the potential liability for a failure to meet regulatory requirements; the financial condition and liquidity of, or disputes with, joint venture partners; any failure to comply with debt covenants under credit agreements; any failure to continue to qualify for taxation as a real estate investment trust and to meet regulatory requirements; risks associated with litigation resulting from the transactions with Parkway and from liabilities or contingent liabilities assumed in the transactions with Parkway; risks associated with any errors or omissions in financial or other information of Parkway that has been previously provided to the public; the ability to successfully integrate our operations and employees in connection with the transactions with Parkway and New Parkway; the ability to realize anticipated benefits and synergies of the transactions with Parkway and New Parkway; potential changes to state, local, or federal regulations applicable to our business; material changes in the dividend rates on securities or the ability to pay dividends on common shares or other securities; potential changes to the tax laws impacting REITs and real estate in general; significant costs related to uninsured losses, condemnation, or environmental issues; and those additional risks and factors discussed in reports filed with the SEC by the Company.
The words “believes,” “expects,” “anticipates,” “estimates,” “plans,” “may,” “intend,” “will,” or similar expressions are intended to identify forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in any forward-looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information, or otherwise, except as required under U.S. federal securities laws.





COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; in thousands, except per share amounts)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Revenues:
 
 
 
 
 
 
 
Rental property revenues
$
114,007

 
$
46,454

 
$
226,524

 
$
91,807

Fee income
1,854

 
1,824

 
3,791

 
4,023

Other
3,174

 
27

 
8,600

 
417

 
119,035

 
48,305

 
238,915

 
96,247

Costs and expenses:
 

 
 

 
 

 
 

Rental property operating expenses
41,501

 
19,526

 
83,026

 
37,330

Reimbursed expenses
907

 
798

 
1,772

 
1,668

General and administrative expenses
8,618

 
4,691

 
14,828

 
12,934

Interest expense
8,523

 
5,369

 
18,264

 
10,808

Depreciation and amortization
50,040

 
16,641

 
104,924

 
33,182

Acquisition and transaction costs
246

 
2,424

 
2,177

 
2,443

Other
236

 
152

 
612

 
507

 
110,071

 
49,601

 
225,603

 
98,872

Gain on extinguishment of debt
1,829

 
—

 
1,829

 
—

Income (loss) from continuing operations before unconsolidated joint ventures and gain (loss) on sale of investment properties
10,793

 
(1,296
)
 
15,141

 
(2,625
)
Income from unconsolidated joint ventures
40,320

 
1,784

 
40,901

 
3,618

Income from continuing operations before gain (loss) on sale of investment properties
51,113

 
488

 
56,042

 
993

Gain (loss) on sale of investment properties
119,832

 
(246
)
 
119,761

 
13,944

Income from continuing operations
170,945

 
242

 
175,803

 
14,937

Income from discontinued operations
—

 
7,523

 
—

 
15,624

Net income
170,945

 
7,765

 
175,803

 
30,561

Net income attributable to noncontrolling interests
(2,856
)
 
—

 
(2,963
)
 
—

Net income available to common stockholders
$
168,089

 
$
7,765

 
$
172,840

 
$
30,561

Per common share information — basic and diluted:
 
 
 
 
 
 
 
Income from continuing operations for common stockholders
$
0.40

 
$
—

 
$
0.42

 
$
0.07

Income from discontinued operations for common stockholders
—

 
0.04

 
—

 
0.08

Net income available to common stockholders
$
0.40

 
$
0.04

 
$
0.42

 
$
0.15

Weighted average shares — basic
419,402

 
210,129

 
411,137

 
210,516

Weighted average shares — diluted
427,180

 
210,362

 
419,227

 
210,687






COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES
FUNDS FROM OPERATIONS
(unaudited; in thousands, except per share amounts)

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Net Income Available to Common Stockholders
$
168,089

 
$
7,765

 
$
172,840

 
$
30,561

Depreciation and amortization of real estate assets:
 
 
 
 
 
 
 
Consolidated properties
49,575

 
16,306

 
104,009

 
32,470

Discontinued properties
—

 
15,740

 
—

 
31,168

Share of unconsolidated joint ventures
3,478

 
3,231

 
7,673

 
6,490

(Gain) loss on sale of depreciated properties:
 
 
 
 
 
 
 
Consolidated properties
(119,767
)
 
246

 
(119,750
)
 
(13,944
)
Share of unconsolidated joint ventures
(37,871
)
 
—

 
(34,332
)
 
—

     Non-controlling interest related to unit holders
2,856

 
—

 
2,957

 
—

Funds From Operations
$
66,360

 
$
43,288

 
$
133,397

 
$
86,745

Per Common Share — Diluted:
 
 
 
 
 
 
 
Funds from Operations
$
0.16

 
$
0.21

 
$
0.32

 
$
0.41

Weighted Average Shares — Basic
419,402

 
210,129

 
411,137

 
210,516

Weighted Average Shares — Diluted
427,180

 
210,362

 
419,227

 
210,687


The table above shows Funds From Operations Available to Common Stockholders (“FFO”) and the related reconciliation to Net Income Available to Common Stockholders for Cousins Properties Incorporated and Subsidiaries. The Company calculated FFO in accordance with the National Association of Real Estate Investment Trusts' ("NAREIT") definition, which is net income (loss) available to common stockholders (computed in accordance with accounting principles generally accepted in the United States ("GAAP")), excluding extraordinary items, cumulative effect of change in accounting principle and gains or losses from sales of depreciable property, plus depreciation and amortization of real estate assets, impairment losses on depreciable investment property and after adjustments for unconsolidated partnerships and joint ventures to reflect FFO on the same basis.
FFO is used by industry analysts and investors as a supplemental measure of an equity REIT’s operating performance. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry investors and analysts have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. Thus, NAREIT created FFO as a supplemental measure of REIT operating performance that excludes historical cost depreciation, among other items, from GAAP net income. Management believes that the use of FFO, combined with the required primary GAAP presentations, has been fundamentally beneficial, improving the understanding of operating results of REITs among the investing public and making comparisons of REIT operating results more meaningful. Company management evaluates operating performance in part based on FFO. Additionally, the Company uses FFO along with other measures, to assess performance in connection with evaluating and granting incentive compensation to its officers and other key employees.






COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)

 
June 30, 2017
 
December 31, 2016
 
(unaudited)
 
 
Assets:
 
 
 
Real estate assets:
 
 
 
Operating properties, net of accumulated depreciation of $217,925 and $215,856 in 2017 and 2016, respectively
$
3,479,262

 
$
3,432,522

Projects under development
203,562

 
162,387

Land
4,221

 
4,221

 
3,687,045

 
3,599,130

 
 
 
 
Cash and cash equivalents
16,420

 
35,687

Restricted cash
8,139

 
15,634

Notes and accounts receivable, net of allowance for doubtful accounts of $1,425 and $1,167 in 2017 and 2016, respectively
20,530

 
27,683

Deferred rents receivable
47,240

 
39,464

Investment in unconsolidated joint ventures
101,532

 
179,397

Intangible assets, net of accumulated amortization of $85,341 and $53,483 in 2017 and 2016, respectively
225,860

 
245,529

Other assets
29,280

 
29,083

Total assets
$
4,136,046

 
$
4,171,607

Liabilities:
 
 
 
Notes payable
$
1,019,619

 
$
1,380,920

Accounts payable and accrued expenses
128,772

 
109,278

Deferred income
34,743

 
33,304

Intangible liabilities, net of accumulated amortization of $21,543 and $12,227 in 2017 and 2016, respectively
80,466

 
89,781

Other liabilities
42,769

 
44,084

Total liabilities
1,306,369

 
1,657,367

Commitments and contingencies
 
 
 
Equity:
 
 
 
Stockholders' investment:
 
 
 
Preferred stock, $1 par value, 20,000,000 shares authorized, 6,867,357 shares issued and outstanding in 2017 and 2016
6,867

 
6,867

Common stock, $1 par value, 700,000,000 shares authorized, 430,296,523 and 403,746,938 shares issued in 2017 and 2016, respectively
430,297

 
403,747

Additional paid-in capital
3,604,036

 
3,407,430

Treasury stock at cost, 10,329,082 shares in 2017 and 2016
(148,373
)
 
(148,373
)
Distributions in excess of cumulative net income
(1,114,662
)
 
(1,214,114
)
Total stockholders' investment
2,778,165

 
2,455,557

Nonredeemable noncontrolling interests
51,512

 
58,683

Total equity
2,829,677

 
2,514,240

Total liabilities and equity
$
4,136,046

 
$
4,171,607






COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES
SAME PROPERTY INFORMATION
(unaudited; in thousands)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Net income
$
170,945

 
$
7,765

 
$
175,803

 
$
30,561

Net operating income from unconsolidated joint ventures
7,609

 
6,954

 
16,783

 
13,600

Net operating income from discontinued operations
—

 
25,126

 
—

 
50,444

Fee income
(1,854
)
 
(1,824
)
 
(3,791
)
 
(4,023
)
Other income
(3,174
)
 
(27
)
 
(8,600
)
 
(417
)
Reimbursed expenses
907

 
798

 
1,772

 
1,668

General and administrative expenses
8,618

 
4,691

 
14,828

 
12,934

Interest expense
8,523

 
5,369

 
18,264

 
10,808

Depreciation and amortization
50,040

 
16,641

 
104,924

 
33,182

Acquisition and transaction costs
246

 
2,424

 
2,177

 
2,443

Other expenses
236

 
152

 
612

 
507

Gain on extinguishment of debt
(1,829
)
 
—

 
(1,829
)
 
—

Income from unconsolidated joint ventures
(40,320
)
 
(1,784
)
 
(40,901
)
 
(3,618
)
(Gain) loss on sale of investment properties
(119,832
)
 
246

 
(119,761
)
 
(13,944
)
Income from discontinued operations
—

 
(7,523
)
 
—

 
(15,624
)
Net Operating Income
$
80,115

 
$
59,008

 
$
160,281

 
$
118,521

 
 
 
 
 
 
 
 
Net Operating Income
 
 
 
 
 
 
 
Same Property
$
22,459

—

$
21,025

 
$
45,266

 
$
42,504

Non-Same Property
57,656

—

37,983

 
115,015

 
76,017


$
80,115

 
$
59,008

 
$
160,281

 
$
118,521

 
 
 
 
 
 
 
 
Non-Cash Items
 
 
 
 
 
 
 
Straight-line rent
$
7,826

 
$
3,434

 
$
17,434

 
$
7,029

Non-cash income
2,664

 
1,843

 
4,891

 
3,515

Non-cash expense
(255
)
 
17

 
(538
)
 
29

 
$
10,235

 
$
5,294

 
$
21,787

 
$
10,573

Cash Basis Net Operating Income
 
 
 
 
 
 
 
 Same Property
$
20,817

 
$
19,161

 
$
41,281

 
$
38,364

 Non-Same Property
49,063

 
34,553

 
97,213

 
69,584

 
$
69,880

 
$
53,714

 
$
138,494

 
$
107,948






LEGACY PARKWAY PROPERTIES
SAME PROPERTY INFORMATION
(unaudited; in thousands)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2017
 
2016
 
2017
 
2016
 
 
 
 
 
 
 
 
 
 
Net Operating Income
$
45,722

(1)
$
64,977

(2)
$
91,558

(1)
$
131,672

(2)
Straight line rent
(5,039
)
 
(8,124
)
 
(12,403
)
 
(17,820
)
 
Non-cash income
(1,379
)
 
(1,054
)
 
(2,434
)
 
(3,283
)
 
Non-cash expense
163

 
169

 
326

 
338

 
Other Adjustment
—

 
124

 
—

 
(535
)
 
Cash Basis Net Operating Income
$
39,467

 
$
56,092

 
$
77,047

 
$
110,372

 
 
 
 
 
 
 
 
 
 
Cash Basis Net Operating Income
 
 
 
 
 
 
 
 
Same Property
$
38,505

 
$
34,464

 
75,276

 
67,410

 
Non-Same Property
962

 
21,628

 
1,771

 
42,962

 
 
$
39,467

 
$
56,092

 
$
77,047

 
$
110,372

 
 
 
 
 
 
 
 
 
 
(1) Represents Net Operating Income of the legacy Parkway Properties now included in the Company's Net Operating Income.
 
(2) Represents Net Operating Income of Parkway Properties included in its Quarterly Report on Form 10-Q. A reconciliation of Net income (loss) to Net Operating Income is as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
June 30, 2016
 
 
 
Six Months Ended
June 30, 2016
 
Net income (loss)
 
 
$
(1,072
)
 
 
 
$
63,469

 
Management company income
 
 
(1,260
)
 
 
 
(2,696
)
 
Management company expense
 
 
1,189

 
 
 
1,863

 
Depreciation and amortization
 
 
38,630

 
 
 
80,570

 
General and administrative
 
 
12,264

 
 
 
19,263

 
Interest and other income
 
 
(191
)
 
 
 
(435
)
 
Equity in earnings of unconsolidated joint ventures
 
(269
)
 
 
 
(518
)
 
Net gains on sale of real estate
 
 
38

 
 
 
(62,982
)
 
Interest expense
 
 
15,798

 
 
 
32,713

 
Income tax expense
 
 
312

 
 
 
887

 
Other
 
 
(462
)
 
 
 
(462
)
 
Net Operating Income
 
 
$
64,977

 
 
 
$
131,672

 

This schedule shows Same Property Net Operating Income and Cash Basis Same Property Net Operating Income for the properties acquired in the merger with Parkway and the related reconciliation to net income for 2016 as reported by Parkway in its Quarterly Report on Form 10-Q. Net Operating Income and Cash Basis Net Operating Income are used by industry analysts, investors, and Company management to measure operating performance of the Company's properties. Net Operating Income, which is consolidated rental property revenues less consolidated rental property operating expenses plus the Company's share of net operating income from unconsolidated joint ventures and net operating income from discontinued operations, excludes certain components from net income in order to provide results that are more closely related to a property's results of operations. Certain items, such as interest, depreciation, and amortization expenses, while included in FFO and net income, do not affect the operating performance of a real estate asset. As a result, management uses only those operating income and expense items that are incurred at the property level to evaluate a property's performance. Net operating income from unconsolidated joint ventures, which joint ventures the Company does not control, is derived from the rental property revenues and rental property operating expenses at the joint ventures multiplied by the Company's ownership percentage in the joint ventures. Same Property Net Operating Income includes those office properties that have been fully operational in each of the comparable reporting periods. A fully operational property is one that has achieved 90% economic occupancy or has been substantially complete and owned by the Company for each of the two periods presented. Cash Basis Same Property Net Operating Income represents Net Operating Income excluding straight-line rents, amortization of lease inducements, and amortization of acquired above and below market rents. Same Property Net Operating Income and Cash Basis Same Property Net Operating Income allow analysts, investors, and management to analyze continuing operations and evaluate the growth trend of the Company's portfolio.