Maryland | 1-10524 | 54-0857512 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
1745 Shea Center Drive, Suite 200, Highlands Ranch, Colorado |
80129 |
|
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
(a) Financial Statements of Real Estate Property Acquired |
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Rivergate |
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Report of Independent Auditors |
4 | |||
Statement of Revenues and Certain Expenses for the year ended December 31, 2010 |
5 | |||
Notes to Statement of Revenues and Certain Expenses |
6 | |||
(b) Unaudited Pro Forma Financial Information |
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Pro Forma Consolidated Balance Sheet as of December 31, 2010 |
8 | |||
Pro Forma Consolidated Statement of Operations for the year ended December 31, 2010 (unaudited) |
9 | |||
Pro Forma Consolidated Statement of Operations for the six months ended June 30, 2011 (unaudited) |
10 | |||
Notes to Pro Forma Consolidated Financial Statements (unaudited) |
11 | |||
(c) Exhibits |
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23.1 Consent of Independent Auditors |
13 |
2
UDR, Inc. |
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Date: November 1, 2011 | By: | /s/ David L. Messenger | ||
David L. Messenger | ||||
Senior Vice President & Chief Financial Officer (duly authorized officer, principal financial officer and chief accounting officer) |
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3
/s/ Ernst & Young LLP | ||||
4
Six Months | ||||||||
Ended | Year Ended | |||||||
June 30, | December 31, | |||||||
2011 | 2010 | |||||||
(Unaudited) | ||||||||
Revenues: |
||||||||
Rental income |
$ | 13,782 | $ | 27,266 | ||||
Other property income |
300 | 609 | ||||||
Total revenues |
14,082 | 27,875 | ||||||
Certain operating expenses: |
||||||||
Personnel |
1,503 | 2,609 | ||||||
Utilities |
965 | 1,271 | ||||||
Repairs and maintenance |
1,680 | 1,413 | ||||||
Administrative and marketing |
311 | 1,342 | ||||||
Real estate taxes and insurance |
4,307 | 8,601 | ||||||
Total certain operating expenses |
8,766 | 15,236 | ||||||
Revenues in excess of certain operating
expenses |
$ | 5,316 | $ | 12,639 | ||||
5
6
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UDR | Pro Forma | |||||||||||
(Historical) | Adjustments | Pro Forma | ||||||||||
(audited) | (unaudited) | (unaudited) | ||||||||||
ASSETS |
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Real estate owned: |
||||||||||||
Real estate held for investment |
$ | 7,141,505 | $ | 440,544 | (a) | $ | 7,582,049 | |||||
Less: accumulated depreciation |
(1,726,258 | ) | | (1,726,258 | ) | |||||||
Real estate held for investment, net |
5,415,247 | 440,544 | 5,855,791 | |||||||||
Real estate under development |
157,301 | | 157,301 | |||||||||
Total real estate owned, net of accumulated depreciation |
5,572,548 | 440,544 | 6,013,092 | |||||||||
Cash and cash equivalents |
21,634 | | 21,634 | |||||||||
Marketable securities |
| | | |||||||||
Restricted cash |
20,220 | | 20,220 | |||||||||
Deferred financing costs, net |
24,747 | | 24,747 | |||||||||
Notes receivable |
7,800 | | 7,800 | |||||||||
Investment in unconsolidated joint ventures |
177,404 | | 177,404 | |||||||||
Other assets |
137,424 | 3,906 | (a) | 141,330 | ||||||||
Total assets |
$ | 5,961,777 | $ | 444,450 | $ | 6,406,227 | ||||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||||||
Secured debt |
$ | 1,992,401 | $ | | $ | 1,992,401 | ||||||
Unsecured debt |
1,707,185 | 443,403 | (a) | 2,150,588 | ||||||||
Real estate taxes payable |
14,525 | | 14,525 | |||||||||
Accrued interest payable |
23,341 | | 23,341 | |||||||||
Security deposits and prepaid rent |
30,524 | | 30,524 | |||||||||
Distributions payable |
42,654 | | 42,654 | |||||||||
Deferred fees and gains on the sale of depreciable property |
29,011 | | 29,011 | |||||||||
Accounts payable, accrued expenses, and other liabilities |
104,179 | 1,047 | (a) | 105,226 | ||||||||
Total liabilities |
3,943,820 | 444,450 | 4,388,270 | |||||||||
Redeemable non-controlling interests in operating partnership |
187,309 | | 187,309 | |||||||||
Stockholders equity |
||||||||||||
Preferred stock, no par value; 50,000,000 shares authorized |
||||||||||||
2,803,812 shares of 8.00% Series E Cumulative Convertible issued
and outstanding (2,803,812 shares at December 31, 2010) |
46,571 | | 46,571 | |||||||||
3,264,362 shares of 6.75% Series G Cumulative Redeemable issued
and outstanding (3,405,562 shares at December 31, 2010) |
81,609 | | 81,609 | |||||||||
Common stock, $0.01 par value; 250,000,000 shares authorized |
| |||||||||||
196,660,518 shares issued and outstanding (182,496,330 shares at December 31, 2010) |
1,967 | | 1,967 | |||||||||
Additional paid-in capital |
2,782,510 | | 2,782,510 | |||||||||
Distributions in excess of net income |
(1,075,499 | ) | | (1,075,499 | ) | |||||||
Accumulated other comprehensive income/(loss), net |
(10,285 | ) | | (10,285 | ) | |||||||
Total UDR, Inc. stockholders equity |
1,826,873 | | 1,826,873 | |||||||||
Non-controlling interest |
3,775 | 3,775 | ||||||||||
Total equity |
1,830,648 | | 1,830,648 | |||||||||
Total liabilities and stockholders equity |
$ | 5,961,777 | $ | 444,450 | $ | 6,406,227 | ||||||
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Historical | ||||||||||||||||||||
Previously | ||||||||||||||||||||
Acquired | Pro Forma | |||||||||||||||||||
UDR | Communities | Rivergate | Adjustments | Pro Forma | ||||||||||||||||
(audited) | (audited) | (audited) | (unaudited) | (unaudited) | ||||||||||||||||
REVENUES |
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Rental income |
$ | 605,295 | $ | 39,836 | $ | 27,266 | 198 | (a) | 672,595 | |||||||||||
Non-property income: |
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Other income |
12,494 | 1,487 | 609 | | 14,590 | |||||||||||||||
Total revenues |
617,789 | 41,323 | 27,875 | 198 | 687,185 | |||||||||||||||
EXPENSES |
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Rental expenses: |
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Real estate taxes and insurance |
75,041 | 2,508 | 8,601 | | 86,150 | |||||||||||||||
Personnel |
55,411 | 2,277 | 2,609 | | 60,297 | |||||||||||||||
Utilities |
33,140 | 3,167 | 1,271 | | 37,578 | |||||||||||||||
Repair and maintenance |
34,369 | 2,833 | 1,413 | | 38,615 | |||||||||||||||
Administrative and marketing |
15,814 | 1,535 | 1,342 | | 18,691 | |||||||||||||||
Property management |
16,646 | 407 | | | 17,053 | |||||||||||||||
Other operating expenses |
5,848 | | | 72 | (b) | 5,920 | ||||||||||||||
Real estate depreciation and amortization |
289,957 | | | 63,168 | (c) | 353,125 | ||||||||||||||
Interest |
||||||||||||||||||||
Expense incurred |
142,984 | | | 17,141 | (d) | 160,125 | ||||||||||||||
Net loss/(gain) on debt extinguishment |
1,204 | | | | 1,204 | |||||||||||||||
Amortization of convertible debt discount |
3,530 | | | | 3,530 | |||||||||||||||
General and administrative |
42,710 | | | | 42,710 | |||||||||||||||
Severance costs and other restructuring charges |
6,803 | | | | 6,803 | |||||||||||||||
Other depreciation and amortization |
4,843 | | | | 4,843 | |||||||||||||||
Total expenses |
728,300 | 12,727 | 15,236 | 80,381 | 836,644 | |||||||||||||||
Loss from operations |
(110,511 | ) | 28,596 | 12,639 | (80,183 | ) | (149,459 | ) | ||||||||||||
Loss from unconsolidated entities |
(4,204 | ) | | | | (4,204 | ) | |||||||||||||
Loss from continuing operations |
(114,715 | ) | 28,596 | 12,639 | (80,183 | ) | (153,663 | ) | ||||||||||||
Income from discontinued operations |
8,127 | | | | 8,127 | |||||||||||||||
Consolidated net (loss)/income |
(106,588 | ) | 28,596 | 12,639 | (80,183 | ) | (145,536 | ) | ||||||||||||
Net loss attributable to redeemable non-controlling interests in OP |
3,835 | (1,347 | ) | | 4,367 | (e) | 6,855 | |||||||||||||
Net income attributable to non-controlling interests |
(146 | ) | | | | (146 | ) | |||||||||||||
Net (loss)/income attributable to UDR, Inc. |
(102,899 | ) | 27,249 | 12,639 | (75,816 | ) | (138,827 | ) | ||||||||||||
Distributions to preferred stockholders Series E (Convertible) |
(3,726 | ) | | | (3,726 | ) | ||||||||||||||
Distributions to preferred stockholders Series G |
(5,762 | ) | | | (5,762 | ) | ||||||||||||||
Discount on preferred stock repurchases, net |
25 | | | 25 | ||||||||||||||||
Net (loss)/income attributable to common stockholders |
$ | (112,362 | ) | $ | 27,249 | $ | 12,639 | $ | (75,816 | ) | $ | (148,290 | ) | |||||||
Earnings/(loss) per weighted average common share basic : |
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Loss from continuing operations attributable to common stockholders |
$ | (0.73 | ) | $ | (0.94 | ) | ||||||||||||||
Income from discontinued operations |
$ | 0.05 | $ | 0.05 | ||||||||||||||||
Net loss attributable to common stockholders |
$ | (0.68 | ) | $ | (0.89 | ) | ||||||||||||||
Earnings/(loss) per weighted average common share diluted: |
||||||||||||||||||||
Loss from continuing operations attributable to common stockholders |
$ | (0.73 | ) | $ | (0.94 | ) | ||||||||||||||
Income from discontinued operations |
$ | 0.05 | $ | 0.05 | ||||||||||||||||
Net loss attributable to common stockholders |
$ | (0.68 | ) | $ | (0.89 | ) | ||||||||||||||
Weighted average number of common shares outstanding basic |
165,857 | 165,857 | ||||||||||||||||||
Weighted
average number of common shares outstanding diluted |
165,857 | 165,857 |
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Pro Forma Adjustments- | ||||||||||||||||||||
Historical | Previously Acquired | Pro Forma | Pro Forma | |||||||||||||||||
UDR | Rivergate | Communities (f) | Adjustments | Consolidated | ||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
REVENUES |
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Rental income |
$ | 340,462 | $ | 13,782 | $ | 10,787 | $ | 71( | a) | $ | 365,102 | |||||||||
Non-property income: |
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Other income |
7,390 | 300 | | | 7,690 | |||||||||||||||
Total revenues |
347,852 | 14,082 | 10,787 | 71 | 372,792 | |||||||||||||||
EXPENSES |
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Rental expenses: |
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Real estate taxes and insurance |
41,355 | 4,307 | 646 | | 46,308 | |||||||||||||||
Personnel |
30,168 | 1,503 | 841 | | 32,512 | |||||||||||||||
Utilities |
18,133 | 965 | 582 | | 19,680 | |||||||||||||||
Repair and maintenance |
18,560 | 1,680 | 326 | | 20,566 | |||||||||||||||
Administrative and marketing |
8,270 | 311 | 245 | | 8,826 | |||||||||||||||
Property management |
9,363 | | 297 | | 9,660 | |||||||||||||||
Other operating expenses |
3,001 | | 18 | | 3,019 | |||||||||||||||
Real estate depreciation and amortization |
172,625 | | 12,635 | 9,617( | c) | 194,877 | ||||||||||||||
Interest |
||||||||||||||||||||
Expense incurred |
72,969 | | 2,791 | 1,774 | 77,534 | |||||||||||||||
Amortization of convertible debt discount |
718 | | | | 718 | |||||||||||||||
Other debt charges |
4,059 | | | | 4,059 | |||||||||||||||
General and administrative |
23,593 | | | | 23,593 | |||||||||||||||
Other depreciation and amortization |
2,029 | | | | 2,029 | |||||||||||||||
Total expenses |
404,843 | 8,766 | 18,381 | 11,391 | 443,381 | |||||||||||||||
Loss from operations |
(56,991 | ) | 5,316 | (7,594 | ) | (11,320 | ) | (70,589 | ) | |||||||||||
Loss from unconsolidated entities |
(2,680 | ) | | | | (2,680 | ) | |||||||||||||
Loss from continuing operations |
(59,671 | ) | 5,316 | (7,594 | ) | (11,320 | ) | (73,269 | ) | |||||||||||
Income from discontinued operations |
45,924 | | | | 45,924 | |||||||||||||||
Consolidated net income/(loss) |
(13,747 | ) | 5,316 | (7,594 | ) | (11,320 | ) | (27,345 | ) | |||||||||||
Net (income)/loss attributable to redeemable non-controlling interests in OP |
611 | | | 283( | e) | 894 | ||||||||||||||
Net income attributable to non-controlling interests |
(88 | ) | | | | (88 | ) | |||||||||||||
Net income/(loss) attributable to UDR, Inc. |
(13,224 | ) | 5,316 | (7,594 | ) | (11,037 | ) | (26,539 | ) | |||||||||||
Distributions to preferred stockholders Series E (Convertible) |
(1,862 | ) | | | | (1,862 | ) | |||||||||||||
Distributions to preferred stockholders Series G |
(2,833 | ) | | | | (2,833 | ) | |||||||||||||
(Premium)/discount on preferred stock repurchases, net |
(175 | ) | | | | (175 | ) | |||||||||||||
Net income/(loss) attributable to common stockholders |
$ | (18,094 | ) | $ | 5,316 | $ | (7,594 | ) | $ | (11,037 | ) | $ | (31,409 | ) | ||||||
Earnings/(loss) per weighted average common share basic and diluted: |
||||||||||||||||||||
Loss from continuing operations attributable to common stockholders |
$ | (0.34 | ) | $ | (0.41 | ) | ||||||||||||||
Income from discontinued operations |
$ | 0.24 | $ | 0.24 | ||||||||||||||||
Net loss attributable to common stockholders |
$ | (0.10 | ) | $ | (0.17 | ) | ||||||||||||||
Weighted average number of common shares outstanding basic and diluted |
186,527 | 186,527 |
10
(a) | Reflects the effect of the acquisition of the Rivergate apartment community in July 2011. We financed this acquisition with borrowings under our revolving credit facility. The pro forma purchase price allocations are as follows (purchase price allocations are estimated for pro forma purposes and the actual allocations may differ) (amounts in thousands): |
Leases in Place | ||||||||||||||||||||
for Residential | Below Market | |||||||||||||||||||
Property | Purchase Price | Land | Building | and Retail | Retail Leases | |||||||||||||||
Rivergate |
$ | 443,403 | $ | 114,349 | $ | 326,195 | $ | 3,906 | $ | 1,047 |
(a) | Reflects amortization of approximately $198,000 and $71,000 for the twelve months ended December 31, 2010 and the six month ended June 30, 2011, respectively, for the net below-market lease intangibles recorded as part of the acquisitions. | ||
(b) | Reflects ground lease expense for 10 Hanover Square. | ||
(c) | Reflects the estimated depreciation and amortization that would have been recorded by UDR based on the depreciable basis of the acquired communities, assuming asset lives ranging from five to thirty-five years as well as the amortization of the identifiable intangible values recorded with an estimated useful life of approximately one year. | ||
(d) | Reflects estimated interest expense that would have been recorded for the increase in our revolving credit facility, deferred financing costs and assumed debt, including the impact of amortizing the fair market adjustment on fixed rate debt over the term of the related debt instrument. | ||
(e) | Reflects the difference between historical non-controlling interest and what would have been recorded by the Company as a result of the pro forma adjustments to reported earnings for the acquired and disposed communities. | ||
(f) | Reflects the actual results for the Previously Acquired Communities, pro rated for the six months ended June 30, 2011. |
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23.1 | Consent
of Ernst & Young LLP Independent Auditors |
12
Registration | ||
Statement | ||
Number | Description | |
333-129743
|
Form S-3, pertaining to the registration of 11,000,000 shares of Common Stock, including rights to purchase Series C Junior Participating Redeemable Preferred Stock, issuable under the Companys Dividend and Stock Purchase Plan. | |
333-176616
|
Form S-3, Shelf Registration Statement, pertaining to the registration of an indeterminate amount of Common Stock, Preferred Stock, Debt Securities, Guarantees of Debt Securities, Warrants, Subscription Rights, Purchase Contracts and Purchase Units. | |
333-167270
|
Form S-3, pertaining to the registration of 3,882,187 shares of Common Stock. | |
333-160180
|
Form S-8, pertaining to the Companys 1999 Long-Term Incentive Plan. |
/s/ Ernst & Young LLP | ||||
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