UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of The Securities Exchange Act of 1934
Date of report (Date of earliest event reported) July 30, 2019
Pennsylvania Real Estate Investment Trust
(Exact Name of Registrant as Specified in its Charter)
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Pennsylvania |
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1-6300 |
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23-6216339 |
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(State or Other Jurisdiction |
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(Commission |
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(IRS Employer |
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The Bellevue, 200 S. Broad Street Philadelphia, Pennsylvania |
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19102 |
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(Address of Principal Executive Offices) |
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(Zip Code) |
Registrant's telephone number, including area code: (215) 875-0700
(Former Name or Former Address, if Changed Since Last Report)
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:
☐ |
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)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Shares of Beneficial Interest |
PEI |
New York Stock Exchange |
Preferred Shares |
PEIPrB |
New York Stock Exchange |
Preferred Shares |
PEIPrC |
New York Stock Exchange |
Preferred Shares |
PEIPrD |
New York Stock Exchange |
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. ☐
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Item 2.02 |
Results of Operations and Financial Condition. |
On July 30, 2019, Pennsylvania Real Estate Investment Trust (the “Company”) provided on its web site at www.preit.com its Quarterly Supplemental Disclosure dated June 30, 2019. The supplemental disclosure posted on July 30, 2019 included an error on page 23, reporting rolling 12-month NOI for Malls at June 30, 2019 and June 30, 2018, respectively, as 92.7% and 89.7%, rolling 12-month NOI for Malls Total at June 30, 2019 and June 30, 2018, respectively as 100.0% and 98.2% ,rolling 12-month NOI for Other Retail Properties at June 30, 2019 and June 30, 2018, respectively, as 0.0% and 0.0% and rolling 12-month NOI for Other Properties at June 30, 2019 and June 30, 2018, respectively as 0.0% and 1.3%. The correct rolling 12-month NOI for Malls at June 30, 2019 and June 30, 2018, respectively, is 87.4% and 84.6%, the correct rolling 12-month for Malls Total at June 30, 2019 and June 30, 2018, respectively is 94.7% and 93.1%, the correct rolling 12-month NOI for Other Retail Properties at June 30, 2019 and June 30, 2018, respectively, is 5.3% and 5.2% and the correct rolling 12-month NOI for Other Properties at June 30, 2019 and 2018, respectively, is 0.0% and 1.2%.
The supplemental disclosure posted on July 30, 2019 also included an error on page 24, where the percentage of Mall NOI by property as of June 30, 2019 was reported incorrectly. The previously provided and corrected amounts are detailed below.
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June 30, 2019 |
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% of Mall NOI |
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% of Mall NOI |
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As Corrected |
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As Originally Reported |
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Top 6 Malls |
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Willow Grove Park |
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6.3 |
% |
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6.8 |
% |
Cherry Hill Mall |
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14.0 |
% |
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13.6 |
% |
Woodland Mall |
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5.7 |
% |
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5.7 |
% |
Lehigh Valley Mall |
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5.9 |
% |
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5.5 |
% |
The Mall at Prince Georges |
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6.8 |
% |
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5.5 |
% |
Springfield Town Center |
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10.2 |
% |
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10.0 |
% |
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48.8 |
% |
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47.0 |
% |
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Malls 7-12 |
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Dartmouth Mall |
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3.7 |
% |
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3.7 |
% |
Jacksonville Mall |
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3.9 |
% |
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3.7 |
% |
Magnolia Mall |
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3.2 |
% |
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2.8 |
% |
Viewmont Mall |
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4.1 |
% |
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4.0 |
% |
Capital City Mall |
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4.6 |
% |
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4.2 |
% |
Patrick Henry Mall |
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4.3 |
% |
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4.3 |
% |
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23.8 |
% |
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22.5 |
% |
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Malls 13-18 |
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Valley Mall |
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4.1 |
% |
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3.8 |
% |
Springfield Mall |
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1.6 |
% |
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1.7 |
% |
Moorestown Mall |
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3.3 |
% |
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3.8 |
% |
Cumberland Mall |
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3.1 |
% |
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3.2 |
% |
Francis Scott Key Mall |
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3.5 |
% |
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3.4 |
% |
Plymouth Meeting Mall |
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4.1 |
% |
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5.4 |
% |
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19.8 |
% |
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21.3 |
% |
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All Core Malls |
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92.3 |
% |
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90.8 |
% |
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Non-Core Malls |
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Wyoming Valley Mall |
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2.8 |
% |
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3.0 |
% |
Valley View Mall |
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2.0 |
% |
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2.8 |
% |
Exton Square Mall |
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2.8 |
% |
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3.4 |
% |
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All Non-Core Malls |
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7.7 |
% |
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9.2 |
% |
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All Malls |
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100.0 |
% |
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100.0 |
% |
An updated Quarterly Supplemental Disclosure dated June 30, 2019 reporting such corrected amounts has been posted on the Company’s web site. A copy of the corrected Quarterly Supplemental Disclosure is attached as an exhibit to this report.
The information furnished under this "Item 2.02. Results of Operations and Financial Condition" shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such a filing.
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Item 9.01 |
Financial Statements and Exhibits. |
99.1 Quarterly Supplemental Disclosure dated June 30, 2019
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.
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PENNSYLVANIA REAL ESTATE INVESTMENT TRUST |
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August 1, 2019 |
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By: |
/s/ Lisa M. Most |
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Name: Lisa M. Most |
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Title: Senior Vice President, Secretary and General Counsel |
Supplemental Financial and Operating Information
June 30, 2019
www.preit.com
NYSE: PEI
NYSE: PEIPRB, PEIPRC, PEIPRD
Pennsylvania Real Estate Investment Trust
Supplemental Financial and Operating Information
June 30, 2019
Table of Contents |
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Introduction |
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Company Information |
1 |
Earnings Release |
2 |
2019 Earnings Guidance |
6 |
Changes in Funds from Operations for the Three and Six Months Ended June 30, 2019 |
8 |
Market Capitalization and Capital Resources |
9 |
Operating Results |
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Statement of Operations – Three and Six Months Ended June 30, 2019 and June 30, 2018 |
10 |
Computation of Earnings Per Share |
11 |
Reconciliation of Net Operating Income and EBITDAre – Three and Six Months Ended June 30, 2019 and June 30, 2018 |
12 |
Reconciliation of Net Income (GAAP Measure) to Net Operating Income from Consolidated Properties (Non-GAAP Measure) - Three Months Ended June 30, 2019 and June 30, 2018 |
13 |
Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure) - Three Months Ended June 30, 2019 and June 30, 2018 |
14 |
Reconciliation of Net Income (GAAP Measure) to Net Operating Income from Consolidated Properties (Non-GAAP Measure) - Six Months Ended June 30, 2019 and June 30, 2018 |
15 |
Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure) – Six Months Ended June 30, 2019 and June 30, 2018 |
16 |
Reconciliation of Funds From Operations and Funds Available for Distribution – Three and Six Months Ended June 30, 2019 and June 30, 2018 |
17 |
Condensed Consolidated Balance Sheet |
19 |
Assets and Liabilities - Equity Method Investments, at Ownership Share |
20 |
Operating Statistics |
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Leasing Activity Summary – Three Months Ended June 30, 2019 |
21 |
Leasing Activity Summary – Six Months Ended June 30, 2019 |
22 |
Summarized Sales and Rent Per Square Foot and Occupancy Percentages |
23 |
Mall Occupancy Percentage and Sales Per Square Foot |
24 |
Top Twenty Tenants |
25 |
Lease Expirations |
26 |
Property Information |
27 |
Balance Sheet |
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Investment in Real Estate - Consolidated Properties |
30 |
Investment in Real Estate - Equity Method Investments at Ownership Share |
31 |
Anchor Replacement Summary |
32 |
Property Redevelopment Table |
33 |
Capital Expenditures – Three and Six Months Ended June 30, 2019 |
34 |
Debt Analysis |
35 |
Debt Schedule |
37 |
Selected Debt Ratios |
38 |
Forward Looking Statements |
39 |
Definitions |
40 |
Pennsylvania Real Estate Investment Trust
Company Information
Background
PREIT (NYSE:PEI) is a publicly traded real estate investment trust that owns and manages quality properties in compelling markets. PREIT’s robust portfolio of carefully curated retail and lifestyle offerings mixed with destination dining and entertainment experiences are located primarily in the densely-populated eastern U.S. with concentrations in the mid-Atlantic’s top MSAs. PREIT is focused on enhancing the quality of its portfolio through redevelopment, anchor repositioning, diversifying its tenant mix and densifying properties by adding a mix of uses. Since 2012, the Company has driven a transformation guided by an emphasis on portfolio quality and balance sheet strength driven by disciplined capital expenditures. The portfolio consists of 27 retail properties, 25 of which are operating properties and two are development or redevelopment properties. The 25 operating retail properties have a total of 20.0 million square feet and include 21 shopping malls and four other retail properties.
If you would like to learn more about PREIT or participate in our quarterly earnings conference call, please visit preit.com or contact:
Heather Crowell
EVP, Strategy and Communications
200 South Broad Street
Philadelphia, PA 19102
Telephone: (215) 875-0735
Fax: (215) 546-2504
Email: Heather.Crowell@preit.com
Research Coverage |
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Company |
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Analyst |
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Phone Number |
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Barclays Capital |
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Ross Smotrich Linda Tsai |
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(212) 526-2306 (212) 526-9937 |
Citi Investment Research |
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Michael Bilerman Christy McElroy |
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(212) 816-1383 (212) 816-6981 |
Goldman Sachs & Co. LLC |
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Caitlin Burrows |
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(212) 902-4736 |
Green Street Advisors |
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Vince Tibone |
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(949) 640-8780 |
JP Morgan |
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Michael W. Mueller |
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(212) 622-6689 |
Mitsubishi UFJ Securities (USA) |
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Karin A. Ford |
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(212) 405-7249 |
Stifel Nicolaus |
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Simon Yarmak |
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(443) 224-1346 |
SunTrust Robinson Humphrey |
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Ki Bin Kim |
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(212) 303-4124 |
Press release announcements are available on the Company's website at www.preit.com.
1
CONTACT: AT THE COMPANY
Robert McCadden
EVP & CFO
(215) 875-0735
Heather Crowell
EVP, Strategy and Communications
(215) 454-1241
heather.crowell@preit.com
PREIT Reports Second Quarter 2019 Results and Updates Full Year Expectations
Fashion District Philadelphia Set to Open in 51 Days
Comparable Store Sales per Square Foot Grew 5.7% to $531
Core Mall Total Occupancy Stable at 93.7%
Average Renewal Spreads registered 6.1% for the Quarter
Small format renewal spreads were 9.8% in Wholly-owned Portfolio
Approximately 700,000 Square Feet of Leases Currently Executed for Future Occupancy
Philadelphia, PA, July 30, 2019 - PREIT (NYSE: PEI) today reported results for the three and six months ended June 30, 2019. A description of each non-GAAP financial measure and the related reconciliation to the comparable GAAP financial measure is located in the tables accompanying this release.
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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(per share amounts) |
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2019 |
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2018 |
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2019 |
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2018 |
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Net loss - basic and diluted |
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$ |
(0.17 |
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$ |
(0.50 |
) |
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$ |
(0.47 |
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$ |
(0.64 |
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FFO |
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$ |
0.24 |
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$ |
0.38 |
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$ |
0.41 |
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$ |
0.67 |
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FFO, as adjusted |
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$ |
0.22 |
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$ |
0.39 |
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$ |
0.48 |
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$ |
0.68 |
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FFO from assets sold in 2018 |
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$ |
- |
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$ |
- |
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$ |
- |
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$ |
(0.01 |
) |
FFO, as adjusted for assets sold |
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$ |
0.22 |
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$ |
0.39 |
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$ |
0.48 |
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$ |
0.67 |
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"We are seven weeks away from opening our marquee project, Fashion District, which we anticipate will stabilize at over $18 million of NOI, at our share, representing almost 10% of incremental Same Store NOI. We have taken bold action to create a quality portfolio designed to deliver results over the long term, are on track for a strong 2020 and, while not reflected in our results today, have laid the foundation for growth into the future,” said Joseph F. Coradino, Chairman and Chief Executive Officer of PREIT. “We have no unleased department stores in our core portfolio, commitments for 84% of the core mall space impacted by bankruptcy, traffic growing at an average of 5% at our redeveloped properties, a diverse tenant mix comprised of 45% open air, dining and entertainment tenants and sales growing at over 5% to a historic high of $531 per square foot. Our efforts culminate this Fall as we add two trophy assets to our collection, executing on our strategic objective to create a quality platform. Despite a temporary setback, we are on course to execute on the opportunity that we have laid out, including monetizing our multifamily and hotel opportunities to recapitalize the Company.”
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Same Store NOI, excluding lease termination revenue, decreased 3.0% for the three months ended June 30, 2019 compared to June 30, 2018. |
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The quarter was impacted by an incremental $1.6 million of lost rent as a result of bankruptcies and store closings. This was partially offset by incremental revenues from anchor replacements and box openings of $0.7 million in the quarter. |
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NOI-weighted sales at our core malls increased to $540 per square foot. Core Mall sales per square foot reached $531, a 5.7% increase over the prior year and a sequential increase of 2.7%. Average comparable sales per square foot at our top 6 properties rose 5.3% to $633. |
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Core Mall total occupancy was 93.7%, flat compared to June 30, 2018. Non-anchor occupancy declined by 180 basis points after accounting for bankruptcies and chain liquidations that resulted in 51 store closures in 176,000 square feet year-to-date. |
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Non-anchor Leased space exceeds occupied space by 130 basis points when factoring in 697,000 square feet of |
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executed new leases slated for future occupancy, representing $15.0 million in annualized future revenue. |
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Average renewal spreads improved sequentially to 6.1% for the quarter. Average renewal spreads in our wholly-owned portfolio for spaces less than 10,000 square feet were strong at 9.8%. |
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Year-to-date, the Company has completed asset sales generating proceeds of $34.1 million, which together with other actions, improved its liquidity position by over $87.0 million. The Company has no material debt maturities until 2021. |
Primary Factors Affecting Financial Results for the Three Months Ended June 30, 2019 and June 30, 2018:
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Net loss attributable to PREIT common shareholders was $12.6 million, or $0.17 per basic and diluted share for the three months ended June 30, 2019, compared to net loss attributable to PREIT common shareholders of $35.0 million, or $0.50 per basic and diluted share for the three months ended June 30, 2018. |
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Lease Termination revenue at our same store malls declined by $6.4 million. |
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Same Store NOI decreased by $7.9 million, or 13.4%. Revenue from new store openings, including contributions from replacement anchors, mitigated the impact of revenue lost to bankruptcies and associated store closings. |
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Non Same Store NOI decreased by $2.0 million primarily due to lower rents and associated co-tenancy revenue adjustments from multiple anchor closings at Wyoming Valley and Valley View malls and the sale of an office property at Fashion District Philadelphia in the first quarter of 2018. |
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FFO for the three months ended June 30, 2019 was $0.24 per share and OP Unit compared to $0.38 per share and OP Unit in the prior year. Adjustments to FFO in the 2019 quarter included $0.02 per share of net insurance proceeds related to claims for hurricane damage. Adjustments to FFO in the 2018 quarter included loss on debt extinguishment and provision for employee separation expenses that totaled $0.01 per share. |
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General and administrative expenses were impacted by the new lease accounting standard that now limits the capitalization of certain leasing costs. We expensed $1.6 million ($0.02 per share) of costs in the three months ended June 30, 2019 that would have been capitalized under the prior standard. |
All NOI and FFO amounts referenced as primary factors affecting financial results above include our share of unconsolidated properties’ revenues and expenses. Additional information regarding changes in operating results for the three and six month periods ended June 30, 2019 and 2018 is included on page 8.
Asset Dispositions
In April 2019, we closed on the sale of the Whole Foods parcel located at Exton Square Mall for $22.1 million. We recorded a gain of a gain of $1.3 million in connection with this sale.
In April 2019, we sold an undeveloped land parcel located in New Garden Township, Pennsylvania, for total consideration of $11.0 million consisting of $8.25 million in cash and $2.75 million of preferred stock.
In July 2019, we closed on the sale of a Texas Roadhouse outparcel located at Valley View Mall in LaCrosse, WI for $1.4 million.
Year-to- Date Capital Transaction Summary
The table below summarizes year-to-date capital activity that impacts the Company’s liquidity position:
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Closed |
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Under Contract |
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Total |
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Gainesville Development Parcel(1) |
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$ |
5,000 |
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$ |
10,000 |
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$ |
15,000 |
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New Garden Township Parcel(2) |
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8,250 |
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- |
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8,250 |
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Wiregrass mortgage loan sale |
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8,000 |
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- |
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8,000 |
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Whole Foods Parcel(3) |
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10,500 |
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- |
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10,500 |
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Capital City transaction - incremental capacity(4) |
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40,000 |
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- |
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40,000 |
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Gloucester Premium Outlets Parcel |
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937 |
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- |
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937 |
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Fashion District Philadelphia Term Loan expansion (5) |
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13,000 |
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- |
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13,000 |
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Valley View Mall Outparcel Sale |
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1,400 |
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- |
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1,400 |
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Total |
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$ |
87,087 |
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$ |
10,000 |
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$ |
97,087 |
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(1) Under contract and expected to close in the second half of 2019. |
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(2) Represents cash proceeds; does not include $2.8 million of preferred stock received by the Company. |
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(3) Represents the net liquidity to the Company after adjusting for line capacity. Sale price was $22.1 million. |
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(4) Represents the Company's approximate incremental borrowing capacity by the end of 2019, net of the Capital City mortgage loan defeasance. |
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(5) Represents the Company's share of amounts available under the expanded capacity of the Fashion District Philadelphia term loan. |
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Excluding Fashion District Philadelphia, 697,000 square feet of leases are signed for future openings. This is comprised of 499,000 square feet of space expected to open in 2019 contributing annual gross rent of $11.4 million and 198,000 square feet opening in 2020 contributing annual gross rent of $3.6 million. |
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At Fashion District Philadelphia, leases for approximately 90% of the leasable area are signed or are in active negotiation. Noteworthy commitments joining Century 21 and Burlington include H&M, Nike, Forever 21, AMC Theaters, Round One, City Winery, Ulta, Columbia Sportswear, Wonderspaces, American Eagle, Express Factory, Journeys, Skechers and Guess Factory. The first wave of tenants opens on September 19, 2019. |
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At Willow Grove Park, Yard House is under construction for a December 2019 opening and construction continues on the 51,000 square foot Studio Movie Grill, which is projected to open in early 2020. |
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At Valley Mall, both Macy’s and The Bon Ton were replaced in 2018. DICK’s Sporting Goods is under construction in a former Sears location and is expected to open in 2020. |
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At Plymouth Meeting Mall, work continues to replace a former Macy’s with five new tenants - Burlington, DICK’s Sporting Goods, Miller’s Ale House, Michael’s and Edge Fitness. The new anchor space opens in September 2019. |
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The redevelopment at Woodland Mall continues with opening of the new wing anchored by a brand new, top quality Von Maur Department Store planned for October 12, 2019. REI is open and will be joined by Urban Outfitters, Tricho Salon & Spa, Williams-Sonoma, Black Rock Bar & Grill, The Cheesecake Factory and others. |
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At Dartmouth Mall, a lease has been executed with Burlington as the lead tenant for a proactively recaptured Sears store. Occupying 43,000 square feet, the store is expected to open in Spring 2020. The redevelopment plan also includes approximately 35,000 square feet of new outparcels to capitalize on the well-located property. |
Retail Operations
The following table sets forth information regarding sales per square foot in the Company’s mall portfolio, including unconsolidated properties:
A reconciliation of portfolio sales per square foot (1) for the core mall portfolio can be found below:
Comp store sales for the rolling twelve months ended June 30, 2018 |
$ |
485 |
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Organic sales growth |
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28 |
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Impact of non-core malls |
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18 |
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Comp store sales for the rolling twelve months ended June 30, 2019 |
$ |
531 |
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(1) Based on reported sales by all comparable non-anchor tenants that lease individual spaces of less than 10,000 square feet and have occupied the space for at least 24 months. |
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2019 Outlook
The Company expects a GAAP net loss of between $0.59 and $0.46 per diluted share for the year ending December 31, 2019, excluding any gain on sale or conveyance of Wyoming Valley Mall.
The Company is revising its May 2, 2019 guidance for FFO as adjusted of $1.20 to $1.30 per share. FFO is expected to be between $1.16 and $1.27 per share. Same Store NOI, excluding termination revenue, is expected to change between -1.0% and 0.5% with wholly-owned properties in the range of -0.6% to 1.0% and joint venture properties declining between 3.4% and 3.0%.
A reconciliation between GAAP net loss and FFO is as follows:
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2019 Guidance Range |
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(Estimates per diluted share) |
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Low |
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High |
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Net loss attributable to common shareholders |
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$ |
(0.59 |
) |
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$ |
(0.46 |
) |
Depreciation and amortization, non-controlling interest and other |
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1.75 |
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1.73 |
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FFO per share |
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$ |
1.16 |
|
|
$ |
1.27 |
|
Loss on debt extinguishment |
|
|
0.06 |
|
|
|
0.06 |
|
Impairment of development land parcel |
|
|
0.02 |
|
|
|
0.02 |
|
Provision for employee separation expenses |
|
|
0.02 |
|
|
|
0.02 |
|
Insurance recoveries, net |
|
|
(0.06 |
) |
|
|
(0.06 |
) |
FFO per share, as adjusted(1) |
|
$ |
1.20 |
|
|
$ |
1.30 |
|
(1) Estimates per diluted share totals might not foot due to rounding
|
|
Detailed guidance assumptions are included herein in our financial tables.
Our 2019 guidance is based on our current assumptions and expectations about market conditions, our projections regarding occupancy, retail sales and rental rates, and planned capital spending. Our guidance is forward-looking, and is subject to risks, uncertainties and changes in circumstances that might cause future events, achievements or results to differ materially from those expressed or implied by the forward-looking statements.
4
Management has scheduled a conference call for 11:00 a.m. Eastern Time on Wednesday, July 31, 2019, to review the Company’s results and future outlook. To listen to the call, please dial 1-844-885-9139 (domestic toll free), or 1-647-689-4441 (international), and request to join the PREIT call, Conference ID 4279998, at least five minutes before the scheduled start time. Investors can also access the call in a "listen only" mode via the internet at the Company’s website, preit.com. Please allow extra time prior to the call to visit the site and download the necessary software to listen to the Internet broadcast. Financial and statistical information expected to be discussed on the call will also be available on the Company’s website. For best results when listening to the webcast, the Company recommends using Flash Player.
For interested individuals unable to join the conference call, the online archive of the webcast will also be available for one year following the call.
About PREIT
PREIT (NYSE:PEI) is a publicly traded real estate investment trust that owns and manages quality properties in compelling markets. PREIT’s robust portfolio of carefully curated retail and lifestyle offerings mixed with destination dining and entertainment experiences are located primarily in the densely-populated eastern U.S. with concentrations in the mid-Atlantic’s top MSAs. Since 2012, the Company has driven a transformation guided by an emphasis on portfolio quality and balance sheet strength driven by disciplined capital expenditures. Additional information is available at www.preit.com or on Twitter or LinkedIn.
Rounding
Certain summarized information in the tables above may not total due to rounding.
5
Pennsylvania Real Estate Investment Trust
(in millions, except per share amounts)
|
|
2018 |
|
|
2019 Guidance |
|
|
Same Store NOI Growth |
|
|||||||||||
|
|
Actual |
|
|
Low |
|
|
High |
|
|
Low |
|
|
High |
|
|||||
Same store NOI, excluding termination fees |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wholly-owned properties |
|
$ |
188.7 |
|
|
$ |
187.5 |
|
|
$ |
190.6 |
|
|
|
-0.6 |
% |
|
|
1.0 |
% |
Joint venture properties |
|
|
29.7 |
|
|
|
28.7 |
|
|
|
28.8 |
|
|
|
-3.4 |
% |
|
|
-3.0 |
% |
|
|
|
218.4 |
|
|
|
216.2 |
|
|
|
219.4 |
|
|
|
-1.0 |
% |
|
|
0.5 |
% |
Non-same store NOI |
|
|
20.1 |
|
|
|
13.5 |
|
|
|
13.8 |
|
|
|
|
|
|
|
|
|
NOI, excluding lease termination fees |
|
|
238.5 |
|
|
|
229.7 |
|
|
|
233.2 |
|
|
|
|
|
|
|
|
|
Lease termination fees |
|
|
9.2 |
|
|
|
3.0 |
|
|
|
4.0 |
|
|
|
|
|
|
|
|
|
Total NOI |
|
$ |
247.7 |
|
|
$ |
232.7 |
|
|
$ |
237.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
G&A and leasing expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
G&A |
|
|
(38.3 |
) |
|
|
(38.0 |
) |
|
|
(37.5 |
) |
|
|
|
|
|
|
|
|
Leasing costs expensed under ASC 842 |
|
|
- |
|
|
|
(5.8 |
) |
|
|
(6.0 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate revenues |
|
|
4.3 |
|
|
|
1.4 |
|
|
|
1.6 |
|
|
|
|
|
|
|
|
|
Land sale gains |
|
|
8.1 |
|
|
|
8.1 |
|
|
|
11.1 |
|
|
|
|
|
|
|
|
|
Provision for employee separation expenses |
|
|
(1.1 |
) |
|
|
(1.3 |
) |
|
|
(1.3 |
) |
|
|
|
|
|
|
|
|
Impairment of mortgage loan/land parcel |
|
|
(8.1 |
) |
|
|
(1.5 |
) |
|
|
(1.5 |
) |
|
|
|
|
|
|
|
|
Other, including non-real estate depreciation |
|
|
(1.5 |
) |
|
|
(2.1 |
) |
|
|
(2.0 |
) |
|
|
|
|
|
|
|
|
Insurance losses (recoveries) |
|
|
- |
|
|
|
4.6 |
|
|
|
5.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, gross |
|
|
(83.3 |
) |
|
|
(88.8 |
) |
|
|
(88.5 |
) |
|
|
|
|
|
|
|
|
Capitalized interest |
|
|
11.1 |
|
|
|
14.6 |
|
|
|
14.4 |
|
|
|
|
|
|
|
|
|
Preferred dividends |
|
|
(27.4 |
) |
|
|
(27.4 |
) |
|
|
(27.4 |
) |
|
|
|
|
|
|
|
|
Loss on debt extinguishment |
|
|
- |
|
|
|
(4.8 |
) |
|
|
(4.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds from Operations (FFO) |
|
$ |
111.5 |
|
|
$ |
91.7 |
|
|
$ |
100.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of mortgage loan/land parcel |
|
|
8.1 |
|
|
|
1.5 |
|
|
|
1.5 |
|
|
|
|
|
|
|
|
|
Provision for employee separation expenses |
|
|
1.1 |
|
|
|
1.3 |
|
|
|
1.3 |
|
|
|
|
|
|
|
|
|
Insurance recoveries, net and other |
|
|
(0.3 |
) |
|
|
(4.6 |
) |
|
|
(5.0 |
) |
|
|
|
|
|
|
|
|
Loss on debt extinguishment |
|
|
- |
|
|
|
4.8 |
|
|
|
4.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO as adjusted |
|
$ |
120.4 |
|
|
$ |
94.7 |
|
|
$ |
102.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares, including OP units |
|
|
78.3 |
|
|
|
79.0 |
|
|
|
79.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO per share |
|
$ |
1.42 |
|
|
$ |
1.16 |
|
|
$ |
1.27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO, as adjusted per share |
|
$ |
1.54 |
|
|
$ |
1.20 |
|
|
$ |
1.30 |
|
|
|
|
|
|
|
|
|
6
Pennsylvania Real Estate Investment Trust
2019 Earnings Guidance - Reconciliation of Net Income to FFO and FFO as adjusted (Non-GAAP measures)
(in millions, except per share amounts)
|
|
2018 |
|
|
2019 Guidance |
|
||||||
|
|
Actual |
|
|
Low |
|
|
High |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(126.5 |
) |
|
$ |
(18.2 |
) |
|
$ |
(7.7 |
) |
Depreciation and amortization |
|
|
140.3 |
|
|
|
140.0 |
|
|
|
138.3 |
|
Gains on sales of operating assets |
|
|
(4.3 |
) |
|
|
(2.7 |
) |
|
|
(2.9 |
) |
Impairment of real estate assets |
|
|
129.4 |
|
|
|
- |
|
|
|
- |
|
Preferred share dividends |
|
|
(27.4 |
) |
|
|
(27.4 |
) |
|
|
(27.4 |
) |
Funds From Operations (FFO) |
|
$ |
111.5 |
|
|
$ |
91.7 |
|
|
$ |
100.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of mortgage loan/land parcel |
|
|
8.1 |
|
|
|
1.5 |
|
|
|
1.5 |
|
Provision for employee separation expenses |
|
|
1.1 |
|
|
|
1.3 |
|
|
|
1.3 |
|
Insurance recoveries, net and other |
|
|
(0.3 |
) |
|
|
(4.6 |
) |
|
|
(5.0 |
) |
Loss on debt extinguishment |
|
|
- |
|
|
|
4.8 |
|
|
|
4.8 |
|
FFO as adjusted |
|
$ |
120.4 |
|
|
$ |
94.7 |
|
|
$ |
102.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(126.5 |
) |
|
$ |
(18.2 |
) |
|
$ |
(7.7 |
) |
Preferred share dividends |
|
|
(27.4 |
) |
|
|
(27.4 |
) |
|
|
(27.4 |
) |
Noncontrolling interest |
|
|
16.2 |
|
|
|
1.9 |
|
|
|
1.4 |
|
Dividends on unvested resticted shares |
|
|
(0.5 |
) |
|
|
(0.9 |
) |
|
|
(0.9 |
) |
Net loss used to calculate EPS |
|
$ |
(138.2 |
) |
|
$ |
(44.6 |
) |
|
$ |
(34.6 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares |
|
69.7 |
|
|
75.1 |
|
|
75.1 |
|
|||
Weighted average shares, including OP units |
|
78.3 |
|
|
|
79.0 |
|
|
|
79.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share |
|
$ |
(1.98 |
) |
|
$ |
(0.59 |
) |
|
$ |
(0.46 |
) |
7
Pennsylvania Real Estate Investment Trust
Changes in Funds from Operations
for the Three and Six Months Ended June 30, 2019 as compared to the Three and Six Months Ended June 30, 2018
(all per share amounts on a diluted basis unless otherwise noted; rounded to the nearest half penny; amounts may not total due to rounding)
(in thousands, except per share amounts) |
|
Three Months Ended June 30, 2019 |
|
|
Per Diluted Share and OP Unit |
|
|
Six Months Ended June 30, 2019 |
|
|
Per Diluted Share and OP Unit |
|
||||
Funds from Operations, as adjusted June 30, 2018 |
|
$ |
30,278 |
|
|
$ |
0.39 |
|
|
$ |
52,851 |
|
|
$ |
0.68 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes - Q2 2018 to Q2 2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contribution from anchor replacements and new box tenants |
|
|
727 |
|
|
|
0.010 |
|
|
|
1,385 |
|
|
|
0.020 |
|
Impact from 2019 bankruptcies |
|
|
(1,373 |
) |
|
|
(0.020 |
) |
|
|
(1,619 |
) |
|
|
(0.020 |
) |
Other leasing activity, including base rent and net CAM and real estate tax recoveries |
|
|
(1,249 |
) |
|
|
(0.015 |
) |
|
|
(780 |
) |
|
|
(0.010 |
) |
Lease termination revenue |
|
|
(6,393 |
) |
|
|
(0.080 |
) |
|
|
(6,106 |
) |
|
|
(0.080 |
) |
Credit losses |
|
|
180 |
|
|
|
- |
|
|
|
635 |
|
|
|
0.010 |
|
Other |
|
|
449 |
|
|
|
0.005 |
|
|
|
490 |
|
|
|
0.005 |
|
Same Store NOI from unconsolidated properties |
|
|
(287 |
) |
|
|
(0.005 |
) |
|
|
(810 |
) |
|
|
(0.010 |
) |
Same Store NOI |
|
|
(7,946 |
) |
|
|
(0.100 |
) |
|
|
(6,805 |
) |
|
|
(0.085 |
) |
Non Same Store NOI |
|
|
(2,011 |
) |
|
|
(0.025 |
) |
|
|
(2,814 |
) |
|
|
(0.035 |
) |
Dilutive effect of asset sales |
|
|
- |
|
|
|
- |
|
|
|
(412 |
) |
|
|
(0.005 |
) |
General and administrative expenses |
|
|
(691 |
) |
|
|
(0.010 |
) |
|
|
(580 |
) |
|
|
(0.005 |
) |
Capitalization of leasing costs |
|
|
(1,522 |
) |
|
|
(0.020 |
) |
|
|
(2,706 |
) |
|
|
(0.035 |
) |
Gain on sales of non-operating real estate |
|
|
- |
|
|
|
- |
|
|
|
589 |
|
|
|
0.010 |
|
Other |
|
|
(1,017 |
) |
|
|
(0.015 |
) |
|
|
(1,309 |
) |
|
|
(0.015 |
) |
Interest expense, net |
|
|
454 |
|
|
|
0.005 |
|
|
|
(613 |
) |
|
|
(0.010 |
) |
Increase in weighted average shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(0.010 |
) |
Funds from Operations, as adjusted June 30, 2019 |
|
$ |
17,545 |
|
|
$ |
0.22 |
|
|
$ |
38,201 |
|
|
$ |
0.48 |
|
Insurance recoveries, net |
|
|
1,852 |
|
|
|
0.025 |
|
|
|
1,616 |
|
|
|
0.020 |
|
Loss on debt extinguishment |
|
|
- |
|
|
|
- |
|
|
|
(4,768 |
) |
|
|
(0.060 |
) |
Impairment of development land parcel |
|
|
- |
|
|
|
- |
|
|
|
(1,464 |
) |
|
|
(0.020 |
) |
Provision for employee separation expense |
|
|
(141 |
) |
|
|
- |
|
|
|
(860 |
) |
|
|
(0.010 |
) |
Funds from Operations June 30, 2019 |
|
$ |
19,256 |
|
|
$ |
0.24 |
|
|
$ |
32,725 |
|
|
$ |
0.41 |
|
8
Pennsylvania Real Estate Investment Trust
Market Capitalization and Capital Resources
(in thousands)
|
|
June 30, 2019 |
|
|
December 31, 2018 |
|
||
MARKET CAPITALIZATION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY CAPITALIZATION |
|
|
|
|
|
|
|
|
Common Shares Outstanding |
|
|
77,547 |
|
|
|
70,495 |
|
OP Units Outstanding |
|
|
2,023 |
|
|
|
8,272 |
|
Total Common Shares and OP Units Outstanding |
|
|
79,570 |
|
|
|
78,767 |
|
Equity Market Capitalization—Common Shares and OP Units |
|
$ |
517,201 |
|
|
$ |
467,880 |
|
Series B Preferred Shares, Nominal Value |
|
|
86,250 |
|
|
|
86,250 |
|
Series C Preferred Shares, Nominal Value |
|
|
172,500 |
|
|
|
172,500 |
|
Series D Preferred Shares, Nominal Value |
|
|
125,000 |
|
|
|
125,000 |
|
Total Equity Market Capitalization |
|
$ |
900,951 |
|
|
$ |
851,630 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEBT CAPITALIZATION |
|
|
|
|
|
|
|
|
Secured Debt Balance (1) |
|
$ |
1,339,253 |
|
|
$ |
1,408,325 |
|
Unsecured Debt Balance (2) (3) |
|
|
732,000 |
|
|
|
615,000 |
|
Debt Capitalization |
|
$ |
2,071,253 |
|
|
$ |
2,023,325 |
|
TOTAL MARKET CAPITALIZATION |
|
$ |
2,972,204 |
|
|
$ |
2,874,955 |
|
|
|
|
|
|
|
|
|
|
Equity Capitalization/Total Market Capitalization |
|
|
30.3 |
% |
|
|
29.6 |
% |
Debt Capitalization/Total Market Capitalization |
|
|
69.7 |
% |
|
|
70.4 |
% |
Unsecured Debt Balance/Total Debt |
|
|
35.3 |
% |
|
|
30.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL RESOURCES |
|
|
|
|
|
|
|
|
Cash and Cash Equivalents |
|
$ |
29,165 |
|
|
$ |
27,367 |
|
Revolving Facility |
|
|
400,000 |
|
|
|
400,000 |
|
Amount Outstanding |
|
|
(182,000 |
) |
|
|
(65,000 |
) |
Letters of Credit |
|
— |
|
|
|
(5,126 |
) |
|
Available Revolving Facility (4) |
|
$ |
218,000 |
|
|
$ |
329,874 |
|
Term Loans |
|
|
675,000 |
|
|
|
675,000 |
|
Amount Borrowed |
|
|
(675,000 |
) |
|
|
(675,000 |
) |
Available Term Loans |
|
$ |
- |
|
|
$ |
- |
|
TOTAL |
|
$ |
247,165 |
|
|
$ |
357,241 |
|
Shelf Registration |
|
$ |
1,000,000 |
|
|
$ |
1,000,000 |
|
(1) Includes consolidated mortgage debt, our share of mortgage debt from equity method investments, and $125,000 of secured debt from our share of the FDP Term Loan.
(2)The unsecured debt balance includes a 2018 Revolving Facility balance of $182,000 as of June 30, 2019 and $65,000 as of December 31, 2018.
(3)The unsecured debt balance includes a Term Loan balance of $550,000 as of June 30, 2019 and December 31, 2018.
(4)The available Credit Facility borrowings are subject to covenants that may restrict amounts that can be borrowed. Following recent property sales, the NOI from the Company’s remaining unencumbered properties is at a level such that the incremental unsecured amount that the Company may borrow as of June 30, 2019 within the Unencumbered Debt Yield covenant, under the $400.0 million 2018 Revolving Facility, is an aggregate of $123.6 million.
9
Pennsylvania Real Estate Investment Trust
Statement of Operations – Three and Six Months ended June 30, 2019 and 2018
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
(in thousands of dollars) |
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
REVENUE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lease revenue |
|
$ |
73,744 |
|
|
$ |
83,453 |
|
|
$ |
150,358 |
|
|
$ |
161,451 |
|
Expense reimbursements |
|
|
4,916 |
|
|
|
5,395 |
|
|
|
9,978 |
|
|
|
10,629 |
|
Other real estate revenue |
|
|
2,417 |
|
|
|
2,274 |
|
|
|
5,417 |
|
|
|
4,435 |
|
Total real estate revenue |
|
|
81,077 |
|
|
|
91,122 |
|
|
|
165,753 |
|
|
|
176,515 |
|
Other income |
|
|
315 |
|
|
|
851 |
|
|
|
942 |
|
|
|
1,740 |
|
Total revenue |
|
|
81,392 |
|
|
|
91,973 |
|
|
|
166,695 |
|
|
|
178,255 |
|
EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAM and real estate taxes |
|
|
(28,168 |
) |
|
|
(27,347 |
) |
|
|
(57,571 |
) |
|
|
(56,743 |
) |
Utilities |
|
|
(3,681 |
) |
|
|
(3,804 |
) |
|
|
(7,341 |
) |
|
|
(7,713 |
) |
Other property operating expenses |
|
|
(1,913 |
) |
|
|
(2,908 |
) |
|
|
(3,979 |
) |
|
|
(6,308 |
) |
Total property operating expenses |
|
|
(33,762 |
) |
|
|
(34,059 |
) |
|
|
(68,891 |
) |
|
|
(70,764 |
) |
Depreciation and amortization |
|
|
(31,946 |
) |
|
|
(33,356 |
) |
|
|
(66,849 |
) |
|
|
(67,386 |
) |
General and administrative expenses |
|
|
(11,609 |
) |
|
|
(9,396 |
) |
|
|
(22,814 |
) |
|
|
(19,528 |
) |
Provision for employee separation expenses |
|
|
(141 |
) |
|
|
(395 |
) |
|
|
(860 |
) |
|
|
(395 |
) |
Insurance recoveries, net |
|
|
1,852 |
|
|
|
- |
|
|
|
1,616 |
|
|
|
- |
|
Project costs and other expenses |
|
|
(130 |
) |
|
|
(139 |
) |
|
|
(187 |
) |
|
|
(251 |
) |
Total operating expenses |
|
|
(75,736 |
) |
|
|
(77,345 |
) |
|
|
(157,985 |
) |
|
|
(158,324 |
) |
Interest expense, net(1) |
|
|
(15,554 |
) |
|
|
(15,982 |
) |
|
|
(31,452 |
) |
|
|
(30,883 |
) |
Loss on debt extinguishment |
|
|
- |
|
|
|
- |
|
|
|
(4,768 |
) |
|
|
- |
|
Impairment of assets |
|
|
- |
|
|
|
(34,286 |
) |
|
|
- |
|
|
|
(34,286 |
) |
Impairment of development land parcel |
|
|
- |
|
|
|
- |
|
|
|
(1,464 |
) |
|
|
- |
|
Total expenses |
|
|
(91,290 |
) |
|
|
(127,613 |
) |
|
|
(195,669 |
) |
|
|
(223,493 |
) |
Loss before equity in income of partnerships, gain on sales of real estate by equity method investee, and adjustment to gain on sales of interests in non operating real estate |
|
|
(9,898 |
) |
|
|
(35,640 |
) |
|
|
(28,974 |
) |
|
|
(45,238 |
) |
Equity in income of partnerships(2) |
|
|
2,316 |
|
|
|
2,571 |
|
|
|
4,605 |
|
|
|
5,709 |
|
Gain (adjustment to gain) on sales of real estate by equity method investee |
|
|
(11 |
) |
|
|
- |
|
|
|
553 |
|
|
|
2,773 |
|
Gain on sales of real estate, net |
|
|
1,513 |
|
|
|
748 |
|
|
|
1,513 |
|
|
|
748 |
|
Adjustment to gain on sales of interests in non operating real estate |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(25 |
) |
Net loss |
|
|
(6,080 |
) |
|
|
(32,321 |
) |
|
|
(22,303 |
) |
|
|
(36,033 |
) |
Less: net loss attributable to noncontrolling interest |
|
|
329 |
|
|
|
4,119 |
|
|
|
2,017 |
|
|
|
5,231 |
|
Net loss attributable to PREIT |
|
|
(5,751 |
) |
|
|
(28,202 |
) |
|
|
(20,286 |
) |
|
|
(30,802 |
) |
Less: preferred share dividends |
|
|
(6,844 |
) |
|
|
(6,844 |
) |
|
|
(13,688 |
) |
|
|
(13,688 |
) |
Net loss attributable to PREIT common shareholders |
|
$ |
(12,595 |
) |
|
$ |
(35,046 |
) |
|
$ |
(33,974 |
) |
|
$ |
(44,490 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Net of capitalized interest expense of $2,319 and $1,281 for the three months ended June 30, 2019 and 2018, respectively, and $4,323 and $2,907 for the six months ended June 30, 2019 and 2018, respectively. |
|
|||||||||||||||
(2) Equity in the income of partnerships is net of capitalized interest expense of $1,479 and $1,302 for the three months ended June 30, 2019 and 2018, respectively, and $2,951 and $1,921 for the six months ended June 30, 2019 and 2018, respectively. |
|
10
Pennsylvania Real Estate Investment Trust
Computation of Earnings Per Share – Three and Six Months ended June 30, 2019 and 2018
(in thousands, except per share amounts)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
(in thousands, except per share amounts) |
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
Net loss |
|
$ |
(6,080 |
) |
|
$ |
(32,321 |
) |
|
$ |
(22,303 |
) |
|
$ |
(36,033 |
) |
Noncontrolling interest |
|
|
329 |
|
|
|
4,119 |
|
|
|
2,017 |
|
|
|
5,231 |
|
Preferred share dividends |
|
|
(6,844 |
) |
|
|
(6,844 |
) |
|
|
(13,688 |
) |
|
|
(13,688 |
) |
Dividends on unvested restricted shares |
|
|
(224 |
) |
|
|
(138 |
) |
|
|
(441 |
) |
|
|
(276 |
) |
Net loss used to calculate loss per share—basic and diluted |
|
$ |
(12,819 |
) |
|
$ |
(35,184 |
) |
|
$ |
(34,415 |
) |
|
$ |
(44,766 |
) |
Basic and diluted loss per share: |
|
$ |
(0.17 |
) |
|
$ |
(0.50 |
) |
|
$ |
(0.47 |
) |
|
$ |
(0.64 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands of shares) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding—basic |
|
|
76,405 |
|
|
|
69,747 |
|
|
|
73,896 |
|
|
|
69,675 |
|
Effect of common share equivalents(1) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Weighted average shares outstanding—diluted |
|
|
76,405 |
|
|
|
69,747 |
|
|
|
73,896 |
|
|
|
69,675 |
|
(1)The Company had net losses used to calculate earnings per share for all periods presented. Therefore, the effects of common share equivalents the of 683 and 367 for the three months ended June 30, 2019 and 2018, respectively, and 595 and 340 for the six months ended June 30, 2019 and 2018, respectively, are excluded from the calculation of diluted loss per share for these periods because they would be antidilutive.
11
Pennsylvania Real Estate Investment Trust
Reconciliation of Net Operating Income and Earnings Before Interest, Income Taxes, Depreciation, and Amortization for Real Estate– Three and Six Months ended June 30, 2019 and 2018
(Non-GAAP Measures)
(in thousands)
Net Operating Income ("NOI") Reconciliation for the Three Months ended June 30, 2019(1)
|
|
Same Store |
|
|
Change |
|
|
Non Same Store |
|
|
Total |
|
||||||||||||||||||||
|
|
2019 |
|
|
2018 |
|
|
$ |
|
|
% |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||||||
NOI from consolidated properties |
|
$ |
44,082 |
|
|
$ |
51,741 |
|
|
$ |
(7,659 |
) |
|
|
-14.8 |
% |
|
$ |
3,232 |
|
|
$ |
5,322 |
|
|
$ |
47,314 |
|
|
$ |
57,063 |
|
NOI attributable to equity method investments, at ownership share |
|
|
7,067 |
|
|
|
7,354 |
|
|
|
(287 |
) |
|
|
-3.9 |
% |
|
|
135 |
|
|
|
56 |
|
|
|
7,202 |
|
|
|
7,410 |
|
Total NOI |
|
|
51,149 |
|
|
|
59,095 |
|
|
|
(7,946 |
) |
|
|
-13.4 |
% |
|
|
3,367 |
|
|
|
5,378 |
|
|
|
54,516 |
|
|
|
64,473 |
|
Less: lease termination revenue |
|
|
159 |
|
|
|
6,553 |
|
|
|
(6,394 |
) |
|
|
-97.6 |
% |
|
|
1 |
|
|
|
542 |
|
|
|
160 |
|
|
|
7,095 |
|
Total NOI excluding lease termination revenue |
|
$ |
50,990 |
|
|
$ |
52,542 |
|
|
$ |
(1,552 |
) |
|
|
-3.0 |
% |
|
$ |
3,366 |
|
|
$ |
4,836 |
|
|
$ |
54,356 |
|
|
$ |
57,378 |
|
Net Operating Income ("NOI") Reconciliation for the Six Months ended June 30, 2019(1)
|
|
Same Store |
|
|
Change |
|
|
Non Same Store |
|
|
Total |
|
||||||||||||||||||||
|
|
2019 |
|
|
2018 |
|
|
$ |
|
|
% |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||||||
NOI from consolidated properties |
|
$ |
89,353 |
|
|
$ |
95,348 |
|
|
$ |
(5,995 |
) |
|
|
-6.3 |
% |
|
$ |
7,510 |
|
|
$ |
10,403 |
|
|
$ |
96,863 |
|
|
$ |
105,751 |
|
NOI attributable to equity method investments, at ownership share |
|
|
14,119 |
|
|
|
14,929 |
|
|
|
(810 |
) |
|
|
-5.4 |
% |
|
|
105 |
|
|
|
520 |
|
|
|
14,224 |
|
|
|
15,449 |
|
Total NOI |
|
|
103,472 |
|
|
|
110,277 |
|
|
|
(6,805 |
) |
|
|
-6.2 |
% |
|
|
7,615 |
|
|
|
10,923 |
|
|
|
111,087 |
|
|
|
121,200 |
|
Less: lease termination revenue |
|
|
458 |
|
|
|
6,814 |
|
|
|
(6,356 |
) |
|
|
-93.3 |
% |
|
|
17 |
|
|
|
563 |
|
|
|
475 |
|
|
|
7,377 |
|
Total NOI excluding lease termination revenue |
|
$ |
103,014 |
|
|
$ |
103,463 |
|
|
$ |
(449 |
) |
|
|
-0.4 |
% |
|
$ |
7,598 |
|
|
$ |
10,360 |
|
|
$ |
110,612 |
|
|
$ |
113,823 |
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
Earnings Before Interest, Income Taxes, Depreciation, and Amortization for Real Estate ("EBITDAre") Reconciliation(1)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
Net loss |
|
$ |
(6,080 |
) |
|
$ |
(32,321 |
) |
|
$ |
(22,303 |
) |
|
$ |
(36,033 |
) |
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
|
31,946 |
|
|
|
33,356 |
|
|
|
66,849 |
|
|
|
67,386 |
|
Unconsolidated properties at ownership share |
|
|
2,082 |
|
|
|
2,145 |
|
|
|
4,051 |
|
|
|
4,385 |
|
Interest Expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated |
|
|
15,554 |
|
|
|
15,982 |
|
|
|
31,452 |
|
|
|
30,883 |
|
Unconsolidated properties at ownership share |
|
|
2,679 |
|
|
|
2,705 |
|
|
|
5,341 |
|
|
|
5,375 |
|
(Gain)/adjustment to gain on sales of real estate by equity method investee |
|
|
11 |
|
|
|
- |
|
|
|
(553 |
) |
|
|
(2,773 |
) |
(Gain) on sales of interests in real estate, net |
|
|
(1,513 |
) |
|
|
(748 |
) |
|
|
(1,513 |
) |
|
|
(748 |
) |
Loss on debt extinguishment |
|
|
- |
|
|
|
- |
|
|
|
4,768 |
|
|
|
- |
|
Impairment of assets |
|
|
- |
|
|
|
34,286 |
|
|
|
1,464 |
|
|
|
34,286 |
|
EBITDAre |
|
$ |
44,679 |
|
|
$ |
55,405 |
|
|
$ |
89,556 |
|
|
$ |
102,761 |
|
(1) EBITDAre is a non-GAAP measure. See definition on page 40.
12
Pennsylvania Real Estate Investment Trust
Reconciliation of Net Income (Loss) to Net Operating Income from Consolidated Properties (Non-GAAP Measure)
Three Months Ended June 30, 2019 and June 30, 2018
(in thousands)
|
|
Three Months Ended June 30, |
|
|||||
|
|
2019 |
|
|
2018 |
|
||
Net loss |
|
$ |
(6,080 |
) |
|
$ |
(32,321 |
) |
Other income |
|
|
(315 |
) |
|
|
(851 |
) |
Depreciation and amortization |
|
|
31,946 |
|
|
|
33,356 |
|
General and administrative expenses |
|
|
11,609 |
|
|
|
9,396 |
|
Insurance recoveries, net |
|
|
(1,852 |
) |
|
|
- |
|
Provision for employee separation expense |
|
|
141 |
|
|
|
395 |
|
Project costs and other expenses |
|
|
130 |
|
|
|
139 |
|
Interest expense, net |
|
|
15,554 |
|
|
|
15,982 |
|
Impairment of assets |
|
|
- |
|
|
|
34,286 |
|
Impairment of development land parcel |
|
|
- |
|
|
|
- |
|
Equity in income of partnerships |
|
|
(2,316 |
) |
|
|
(2,571 |
) |
Loss on debt extinguishment |
|
|
- |
|
|
|
- |
|
Adjustment to gain on sales of real estate by equity method investee |
|
|
11 |
|
|
|
- |
|
Adjustment to gain on sales of interests in non operating real estate |
|
|
- |
|
|
|
- |
|
(Gain) on sales of interests in real estate, net |
|
|
(1,513 |
) |
|
|
(748 |
) |
NOI from consolidated properties(1) |
|
$ |
47,314 |
|
|
$ |
57,063 |
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
|
|
Same Store |
|
|
Non Same Store |
|
|
Total |
|
|||||||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||||
Real estate revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Base rent |
|
$ |
49,130 |
|
|
$ |
49,007 |
|
|
$ |
4,973 |
|
|
$ |
6,362 |
|
|
$ |
54,103 |
|
|
$ |
55,369 |
|
CAM reimbursement income |
|
|
9,973 |
|
|
|
10,150 |
|
|
|
900 |
|
|
|
1,052 |
|
|
|
10,873 |
|
|
|
11,202 |
|
Real estate tax income |
|
|
8,442 |
|
|
|
8,881 |
|
|
|
429 |
|
|
|
751 |
|
|
|
8,871 |
|
|
|
9,632 |
|
Percentage rent |
|
|
157 |
|
|
|
166 |
|
|
|
(1 |
) |
|
|
(5 |
) |
|
|
156 |
|
|
|
161 |
|
Lease termination revenue |
|
|
155 |
|
|
|
6,548 |
|
|
|
1 |
|
|
|
542 |
|
|
|
156 |
|
|
|
7,090 |
|
|
|
|
67,857 |
|
|
|
74,752 |
|
|
|
6,302 |
|
|
|
8,702 |
|
|
|
74,159 |
|
|
|
83,454 |
|
Less: credit losses |
|
|
(308 |
) |
|
|
- |
|
|
|
(107 |
) |
|
|
- |
|
|
|
(415 |
) |
|
|
- |
|
Lease revenue |
|
|
67,549 |
|
|
|
74,752 |
|
|
|
6,195 |
|
|
|
8,702 |
|
|
|
73,744 |
|
|
|
83,454 |
|
Expense reimbursements |
|
|
4,401 |
|
|
|
4,694 |
|
|
|
515 |
|
|
|
702 |
|
|
|
4,916 |
|
|
|
5,396 |
|
Other real estate revenue |
|
|
2,174 |
|
|
|
2,041 |
|
|
|
242 |
|
|
|
232 |
|
|
|
2,416 |
|
|
|
2,273 |
|
Total real estate revenue |
|
|
74,124 |
|
|
|
81,487 |
|
|
|
6,952 |
|
|
|
9,636 |
|
|
|
81,076 |
|
|
|
91,123 |
|
Property operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAM and real estate taxes |
|
|
(25,121 |
) |
|
|
(24,011 |
) |
|
|
(3,047 |
) |
|
|
(3,336 |
) |
|
|
(28,168 |
) |
|
|
(27,347 |
) |
Utilities |
|
|
(3,244 |
) |
|
|
(3,254 |
) |
|
|
(437 |
) |
|
|
(550 |
) |
|
|
(3,681 |
) |
|
|
(3,804 |
) |
Credit losses |
|
|
- |
|
|
|
(488 |
) |
|
|
- |
|
|
|
(170 |
) |
|
|
- |
|
|
|
(658 |
) |
Other property operating expenses |
|
|
(1,677 |
) |
|
|
(1,993 |
) |
|
|
(236 |
) |
|
|
(258 |
) |
|
|
(1,913 |
) |
|
|
(2,251 |
) |
Total property operating expenses |
|
|
(30,042 |
) |
|
|
(29,746 |
) |
|
|
(3,720 |
) |
|
|
(4,314 |
) |
|
|
(33,762 |
) |
|
|
(34,060 |
) |
NOI from consolidated properties(1) |
|
$ |
44,082 |
|
|
$ |
51,741 |
|
|
$ |
3,232 |
|
|
$ |
5,322 |
|
|
$ |
47,314 |
|
|
$ |
57,063 |
|
Less: Lease termination revenue |
|
|
155 |
|
|
|
6,548 |
|
|
|
1 |
|
|
|
542 |
|
|
|
156 |
|
|
|
7,090 |
|
NOI from consolidated properties excluding lease termination revenue(1) |
|
$ |
43,927 |
|
|
$ |
45,193 |
|
|
$ |
3,231 |
|
|
$ |
4,780 |
|
|
$ |
47,158 |
|
|
$ |
49,973 |
|
% change in Same Store NOI from consolidated properties excluding lease termination revenue |
|
|
|
|
|
|
(2.8 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
13
Pennsylvania Real Estate Investment Trust
Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure)
Three Months Ended June 30, 2019 and June 30, 2018
(in thousands)
|
|
Three Months Ended June 30, |
|
|||||
|
|
2019 |
|
|
2018 |
|
||
Equity in income of partnerships |
|
$ |
2,316 |
|
|
$ |
2,571 |
|
Other income |
|
|
(11 |
) |
|
|
(12 |
) |
Depreciation and amortization |
|
|
2,082 |
|
|
|
2,145 |
|
Interest expense and other expenses, net |
|
|
2,815 |
|
|
|
2,706 |
|
NOI from equity method investments at ownership share(1) |
|
$ |
7,202 |
|
|
$ |
7,410 |
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
|
|
Same Store |
|
|
Non Same Store |
|
|
Total |
|
|||||||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||||
Real estate revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Base rent |
|
$ |
6,573 |
|
|
$ |
6,870 |
|
|
$ |
174 |
|
|
$ |
189 |
|
|
$ |
6,747 |
|
|
$ |
7,059 |
|
CAM reimbursement income |
|
|
1,617 |
|
|
|
1,638 |
|
|
|
7 |
|
|
|
7 |
|
|
|
1,624 |
|
|
|
1,645 |
|
Real estate tax income |
|
|
943 |
|
|
|
921 |
|
|
|
41 |
|
|
|
42 |
|
|
|
984 |
|
|
|
963 |
|
Percentage rent |
|
|
80 |
|
|
|
60 |
|
|
|
- |
|
|
|
- |
|
|
|
80 |
|
|
|
60 |
|
Lease termination revenue |
|
|
4 |
|
|
|
5 |
|
|
|
- |
|
|
|
- |
|
|
|
4 |
|
|
|
5 |
|
|
|
|
9,217 |
|
|
|
9,494 |
|
|
|
222 |
|
|
|
239 |
|
|
|
9,439 |
|
|
|
9,733 |
|
Less: credit losses |
|
|
77 |
|
|
|
- |
|
|
|
62 |
|
|
|
- |
|
|
|
139 |
|
|
|
- |
|
Lease revenue |
|
|
9,294 |
|
|
|
9,494 |
|
|
|
284 |
|
|
|
239 |
|
|
|
9,578 |
|
|
|
9,733 |
|
Expense reimbursements |
|
|
485 |
|
|
|
517 |
|
|
|
53 |
|
|
|
41 |
|
|
|
538 |
|
|
|
558 |
|
Other real estate revenue |
|
|
271 |
|
|
|
229 |
|
|
|
230 |
|
|
|
230 |
|
|
|
501 |
|
|
|
459 |
|
Total real estate revenue |
|
|
10,050 |
|
|
|
10,240 |
|
|
|
567 |
|
|
|
510 |
|
|
|
10,617 |
|
|
|
10,750 |
|
Property operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
CAM and real estate taxes |
|
|
(2,116 |
) |
|
|
(2,115 |
) |
|
|
(352 |
) |
|
|
(362 |
) |
|
|
(2,468 |
) |
|
|
(2,477 |
) |
Utilities |
|
|
(178 |
) |
|
|
(198 |
) |
|
|
(34 |
) |
|
|
(54 |
) |
|
|
(212 |
) |
|
|
(252 |
) |
Credit losses |
|
|
- |
|
|
|
49 |
|
|
|
- |
|
|
|
(5 |
) |
|
|
- |
|
|
|
44 |
|
Other property operating expenses |
|
|
(689 |
) |
|
|
(622 |
) |
|
|
(46 |
) |
|
|
(34 |
) |
|
|
(735 |
) |
|
|
(656 |
) |
Total property operating expenses |
|
|
(2,983 |
) |
|
|
(2,886 |
) |
|
|
(432 |
) |
|
|
(454 |
) |
|
|
(3,415 |
) |
|
|
(3,340 |
) |
NOI from equity method investments at ownership share(1) |
|
$ |
7,067 |
|
|
$ |
7,354 |
|
|
$ |
135 |
|
|
$ |
56 |
|
|
$ |
7,202 |
|
|
$ |
7,410 |
|
Less: Lease termination revenue |
|
|
4 |
|
|
|
5 |
|
|
|
- |
|
|
|
- |
|
|
|
4 |
|
|
|
5 |
|
NOI from equity method investments at ownership share excluding lease termination revenue(1) |
|
$ |
7,063 |
|
|
$ |
7,349 |
|
|
$ |
135 |
|
|
$ |
56 |
|
|
$ |
7,198 |
|
|
$ |
7,405 |
|
% change in Same Store NOI from equity method investments at ownership share excluding lease termination revenue |
|
|
|
|
|
|
(3.9 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
14
Pennsylvania Real Estate Investment Trust
Reconciliation of Net Income (Loss) to Net Operating Income from Consolidated Properties (Non-GAAP Measure)
Six Months Ended June 30, 2019 and June 30, 2018
(in thousands)
|
|
Six Months Ended June 30, |
|
|||||
|
|
2019 |
|
|
2018 |
|
||
Net loss |
|
$ |
(22,303 |
) |
|
$ |
(36,033 |
) |
Other income |
|
|
(942 |
) |
|
|
(1,740 |
) |
Depreciation and amortization |
|
|
66,849 |
|
|
|
67,386 |
|
General and administrative expenses |
|
|
22,814 |
|
|
|
19,528 |
|
Insurance recoveries, net |
|
|
(1,616 |
) |
|
|
- |
|
Provision for employee separation expense |
|
|
860 |
|
|
|
395 |
|
Project costs and other expenses |
|
|
188 |
|
|
|
251 |
|
Interest expense, net |
|
|
31,452 |
|
|
|
30,883 |
|
Impairment of assets |
|
|
- |
|
|
|
34,286 |
|
Impairment of development land parcel |
|
|
1,464 |
|
|
|
- |
|
Equity in income of partnerships |
|
|
(4,605 |
) |
|
|
(5,709 |
) |
Loss on debt extinguishment |
|
|
4,768 |
|
|
|
- |
|
(Gains) on sale of real estate by equity method investee |
|
|
(553 |
) |
|
|
(2,773 |
) |
Adjustment to gain on sales of interests in non operating real estate |
|
|
- |
|
|
|
25 |
|
(Gain) on sales of interests in real estate, net |
|
|
(1,513 |
) |
|
|
(748 |
) |
NOI from consolidated properties(1) |
|
$ |
96,863 |
|
|
$ |
105,751 |
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
|
|
Same Store |
|
|
Non Same Store |
|
|
Total |
|
|||||||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||||
Real estate revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Base rent |
|
$ |
99,517 |
|
|
$ |
98,325 |
|
|
$ |
10,471 |
|
|
$ |
13,018 |
|
|
$ |
109,988 |
|
|
$ |
111,343 |
|
CAM reimbursement income |
|
|
20,675 |
|
|
|
20,567 |
|
|
|
1,874 |
|
|
|
2,235 |
|
|
|
22,549 |
|
|
|
22,802 |
|
Real estate tax income |
|
|
17,392 |
|
|
|
18,339 |
|
|
|
988 |
|
|
|
1,590 |
|
|
|
18,380 |
|
|
|
19,929 |
|
Percentage rent |
|
|
157 |
|
|
|
240 |
|
|
|
7 |
|
|
|
15 |
|
|
|
164 |
|
|
|
255 |
|
Lease termination revenue |
|
|
452 |
|
|
|
6,558 |
|
|
|
17 |
|
|
|
563 |
|
|
|
469 |
|
|
|
7,121 |
|
|
|
|
138,193 |
|
|
|
144,029 |
|
|
|
13,357 |
|
|
|
17,421 |
|
|
|
151,550 |
|
|
|
161,450 |
|
Less: credit losses |
|
|
(855 |
) |
|
|
- |
|
|
|
(337 |
) |
|
|
- |
|
|
|
(1,192 |
) |
|
|
- |
|
Lease revenue |
|
|
137,338 |
|
|
|
144,029 |
|
|
|
13,020 |
|
|
|
17,421 |
|
|
|
150,358 |
|
|
|
161,450 |
|
Expense reimbursements |
|
|
8,822 |
|
|
|
9,157 |
|
|
|
1,156 |
|
|
|
1,473 |
|
|
|
9,978 |
|
|
|
10,630 |
|
Other real estate revenue |
|
|
3,943 |
|
|
|
3,985 |
|
|
|
1,474 |
|
|
|
450 |
|
|
|
5,417 |
|
|
|
4,435 |
|
Total real estate revenue |
|
|
150,103 |
|
|
|
157,171 |
|
|
|
15,650 |
|
|
|
19,344 |
|
|
|
165,753 |
|
|
|
176,515 |
|
Property operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
CAM and real estate taxes |
|
|
(50,851 |
) |
|
|
(49,796 |
) |
|
|
(6,720 |
) |
|
|
(6,947 |
) |
|
|
(57,571 |
) |
|
|
(56,743 |
) |
Utilities |
|
|
(6,393 |
) |
|
|
(6,499 |
) |
|
|
(948 |
) |
|
|
(1,215 |
) |
|
|
(7,341 |
) |
|
|
(7,714 |
) |
Credit losses |
|
|
- |
|
|
|
(1,491 |
) |
|
|
- |
|
|
|
(229 |
) |
|
|
- |
|
|
|
(1,720 |
) |
Other property operating expenses |
|
|
(3,506 |
) |
|
|
(4,037 |
) |
|
|
(472 |
) |
|
|
(550 |
) |
|
|
(3,978 |
) |
|
|
(4,587 |
) |
Total property operating expenses |
|
|
(60,750 |
) |
|
|
(61,823 |
) |
|
|
(8,140 |
) |
|
|
(8,941 |
) |
|
|
(68,890 |
) |
|
|
(70,764 |
) |
NOI from consolidated properties(1) |
|
$ |
89,353 |
|
|
$ |
95,348 |
|
|
$ |
7,510 |
|
|
$ |
10,403 |
|
|
$ |
96,863 |
|
|
$ |
105,751 |
|
Less: Lease termination revenue |
|
|
452 |
|
|
|
6,558 |
|
|
|
17 |
|
|
|
563 |
|
|
|
469 |
|
|
|
7,121 |
|
NOI from consolidated properties excluding lease termination revenue(1) |
|
$ |
88,901 |
|
|
$ |
88,790 |
|
|
$ |
7,493 |
|
|
$ |
9,840 |
|
|
$ |
96,394 |
|
|
$ |
98,630 |
|
% change in Same Store NOI from consolidated properties excluding lease termination revenue |
|
|
|
|
|
|
0.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
15
Pennsylvania Real Estate Investment Trust
Reconciliation of Equity in Income of Partnerships to Net Operating Income from Equity Method Investments, at Ownership Share (Non-GAAP Measure)
Six Months Ended June 30, 2019 and June 30, 2018
(in thousands)
|
|
Six Months Ended June 30, |
|
|||||
|
|
2019 |
|
|
2018 |
|
||
Equity in income of partnerships |
|
$ |
4,605 |
|
|
$ |
5,709 |
|
Other income |
|
|
(23 |
) |
|
|
(23 |
) |
Depreciation and amortization |
|
|
4,051 |
|
|
|
4,385 |
|
Interest expense and other expenses, net |
|
|
5,591 |
|
|
|
5,378 |
|
NOI from equity method investments at ownership share(1) |
|
$ |
14,224 |
|
|
$ |
15,449 |
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
|
|
Same Store |
|
|
Non Same Store |
|
|
Total |
|
|||||||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||||
Real estate revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Base rent |
|
$ |
13,292 |
|
|
$ |
13,871 |
|
|
$ |
346 |
|
|
$ |
964 |
|
|
$ |
13,638 |
|
|
$ |
14,835 |
|
CAM reimbursement income |
|
|
3,301 |
|
|
|
3,305 |
|
|
|
13 |
|
|
|
31 |
|
|
|
3,314 |
|
|
|
3,336 |
|
Real estate tax income |
|
|
1,887 |
|
|
|
1,863 |
|
|
|
84 |
|
|
|
95 |
|
|
|
1,971 |
|
|
|
1,958 |
|
Percentage rent |
|
|
126 |
|
|
|
140 |
|
|
|
- |
|
|
|
- |
|
|
|
126 |
|
|
|
140 |
|
Lease termination revenue |
|
|
6 |
|
|
|
256 |
|
|
|
- |
|
|
|
- |
|
|
|
6 |
|
|
|
256 |
|
|
|
|
18,612 |
|
|
|
19,435 |
|
|
|
443 |
|
|
|
1,090 |
|
|
|
19,055 |
|
|
|
20,525 |
|
Less: credit losses |
|
|
11 |
|
|
|
- |
|
|
|
60 |
|
|
|
- |
|
|
|
71 |
|
|
|
- |
|
Lease revenue |
|
|
18,623 |
|
|
|
19,435 |
|
|
|
503 |
|
|
|
1,090 |
|
|
|
19,126 |
|
|
|
20,525 |
|
Expense reimbursements |
|
|
937 |
|
|
|
1,008 |
|
|
|
93 |
|
|
|
120 |
|
|
|
1,030 |
|
|
|
1,128 |
|
Other real estate revenue |
|
|
550 |
|
|
|
458 |
|
|
|
401 |
|
|
|
406 |
|
|
|
951 |
|
|
|
864 |
|
Total real estate revenue |
|
|
20,110 |
|
|
|
20,901 |
|
|
|
997 |
|
|
|
1,616 |
|
|
|
21,107 |
|
|
|
22,517 |
|
Property operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
CAM and real estate taxes |
|
|
(4,388 |
) |
|
|
(4,316 |
) |
|
|
(718 |
) |
|
|
(826 |
) |
|
|
(5,106 |
) |
|
|
(5,142 |
) |
Utilities |
|
|
(381 |
) |
|
|
(420 |
) |
|
|
(80 |
) |
|
|
(148 |
) |
|
|
(461 |
) |
|
|
(568 |
) |
Credit losses |
|
|
- |
|
|
|
(22 |
) |
|
|
- |
|
|
|
(24 |
) |
|
|
- |
|
|
|
(46 |
) |
Other property operating expenses |
|
|
(1,222 |
) |
|
|
(1,214 |
) |
|
|
(94 |
) |
|
|
(98 |
) |
|
|
(1,316 |
) |
|
|
(1,312 |
) |
Total property operating expenses |
|
|
(5,991 |
) |
|
|
(5,972 |
) |
|
|
(892 |
) |
|
|
(1,096 |
) |
|
|
(6,883 |
) |
|
|
(7,068 |
) |
NOI from equity method investments at ownership share(1) |
|
$ |
14,119 |
|
|
$ |
14,929 |
|
|
$ |
105 |
|
|
$ |
520 |
|
|
$ |
14,224 |
|
|
$ |
15,449 |
|
Less: Lease termination revenue |
|
|
6 |
|
|
|
256 |
|
|
|
- |
|
|
|
- |
|
|
|
6 |
|
|
|
256 |
|
NOI from equity method investments at ownership share excluding lease termination revenue(1) |
|
$ |
14,113 |
|
|
$ |
14,673 |
|
|
$ |
105 |
|
|
$ |
520 |
|
|
$ |
14,218 |
|
|
$ |
15,193 |
|
% change in Same Store NOI from equity method investments at ownership share excluding lease termination revenue |
|
|
|
|
|
|
(3.8 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)NOI is a non-GAAP measure. See definition of NOI on page 40.
16
Pennsylvania Real Estate Investment Trust
Reconciliation of Net Income to Funds From Operations and Funds Available for Distribution (Non-GAAP Measures)
Three and Six Months ended June 30, 2019 and 2018
(in thousands, except per share amounts)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
||||
FUNDS FROM OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(6,080 |
) |
|
$ |
(32,321 |
) |
|
$ |
(22,303 |
) |
|
$ |
(36,033 |
) |
Depreciation and amortization on real estate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated properties |
|
|
31,612 |
|
|
|
33,002 |
|
|
|
66,178 |
|
|
|
66,664 |
|
PREIT's share of equity method investments |
|
|
2,081 |
|
|
|
2,145 |
|
|
|
4,051 |
|
|
|
4,385 |
|
(Gain)/adjustment to gain on sales of real estate by equity method investee |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(2,773 |
) |
(Gain) on sales of interests in real estate, net |
|
|
(1,513 |
) |
|
|
(748 |
) |
|
|
(1,513 |
) |
|
|
(748 |
) |
Impairment of assets |
|
|
- |
|
|
|
34,286 |
|
|
|
- |
|
|
|
34,286 |
|
Dividends on preferred shares |
|
|
(6,844 |
) |
|
|
(6,844 |
) |
|
|
(13,688 |
) |
|
|
(13,688 |
) |
Funds from operations attributable to common shareholders and OP Unit holders(1) |
|
$ |
19,256 |
|
|
$ |
29,520 |
|
|
$ |
32,725 |
|
|
$ |
52,093 |
|
Insurance recoveries, net |
|
|
(1,852 |
) |
|
|
- |
|
|
|
(1,616 |
) |
|
|
- |
|
Loss on debt extinguishment |
|
|
- |
|
|
|
- |
|
|
|
4,768 |
|
|
|
- |
|
Accelerated amortization of financing costs |
|
|
- |
|
|
|
363 |
|
|
|
- |
|
|
|
363 |
|
Impairment of development land parcel |
|
|
- |
|
|
|
- |
|
|
|
1,464 |
|
|
|
- |
|
Provision for employee separation expense |
|
|
141 |
|
|
|
395 |
|
|
|
860 |
|
|
|
395 |
|
Funds from operations, as adjusted, attributable to common shareholders and OP Unit holders |
|
$ |
17,545 |
|
|
$ |
30,278 |
|
|
$ |
38,201 |
|
|
$ |
52,851 |
|
FUNDS AVAILABLE FOR DISTRIBUTION(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds from operations, as adjusted, attributable to common shareholders and OP Unit holders(1) |
|
|
17,545 |
|
|
|
30,278 |
|
|
|
38,201 |
|
|
|
52,851 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Straight line rent |
|
|
(1,516 |
) |
|
|
(442 |
) |
|
|
(3,105 |
) |
|
|
(1,461 |
) |
Recurring capital expenditures |
|
|
(5,089 |
) |
|
|
(5,517 |
) |
|
|
(7,103 |
) |
|
|
(7,707 |
) |
Tenant allowances |
|
|
(1,399 |
) |
|
|
(7,951 |
) |
|
|
(3,469 |
) |
|
|
(9,619 |
) |
Amortization of non-cash deferred compensation |
|
|
1,889 |
|
|
|
1,714 |
|
|
|
3,811 |
|
|
|
3,638 |
|
Capitalized leasing costs |
|
|
(156 |
) |
|
|
(1,769 |
) |
|
|
(476 |
) |
|
|
(3,941 |
) |
Amortization of above- and below-market lease intangibles |
|
|
(14 |
) |
|
|
(22 |
) |
|
|
(28 |
) |
|
|
(50 |
) |
Funds available for distribution to common shareholders and OP Unit holders(1) |
|
$ |
11,260 |
|
|
$ |
16,291 |
|
|
$ |
27,831 |
|
|
$ |
33,711 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds from operations attributable to common shareholders and OP Unit holders per diluted share and OP Unit(1) |
|
$ |
0.24 |
|
|
$ |
0.38 |
|
|
$ |
0.41 |
|
|
$ |
0.67 |
|
Funds from operations, as adjusted, attributable to common shareholders and OP Unit holders per diluted share and OP Unit |
|
$ |
0.22 |
|
|
$ |
0.39 |
|
|
$ |
0.48 |
|
|
$ |
0.68 |
|
Funds available for distribution to common shareholders and OP Unit holders per diluted share and OP Unit(1) |
|
$ |
0.14 |
|
|
$ |
0.21 |
|
|
$ |
0.35 |
|
|
$ |
0.43 |
|
(1) Non-GAAP measures. See definitions on page 40.
(2) Twelve months ended June 30, 2019 and June 30, 2018, respectively.
(Continued on next page)
17
Pennsylvania Real Estate Investment Trust
Reconciliation of Net Income to Funds From Operations and Funds Available for Distribution (Non-GAAP Measures)
Three and Six Months ended June 30, 2019 and 2018
(in thousands, except per share amounts)
|
|
Three Months Ended June 30, |
|
|
|
|
Six Months Ended June 30, |
|
||||||||||||||
|
|
2019 |
|
|
|
|
2018 |
|
|
|
|
2019 |
|
|
|
|
2018 |
|
||||
PAYOUT RATIOS (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payout ratio of funds from operations attributable to common shareholders and OP Unit holders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
71.2 |
% |
|
|
|
|
55.3 |
% |
Payout ratio of funds from operations attributable to common shareholders and OP Unit holders, as adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
62.3 |
% |
|
|
|
|
52.2 |
% |
Payout ratio of funds available for distribution attributable to common shareholders and OP Unit holders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
106.1 |
% |
|
|
|
|
87.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding |
|
|
76,405 |
|
|
|
|
|
69,747 |
|
|
|
|
|
73,896 |
|
|
|
|
|
69,675 |
|
Weighted average effect of full conversion of OP Units |
|
|
2,023 |
|
|
|
|
|
8,273 |
|
|
|
|
|
4,440 |
|
|
|
|
|
8,273 |
|
Effect of common share equivalents |
|
|
683 |
|
|
|
|
|
367 |
|
|
|
|
|
595 |
|
|
|
|
|
340 |
|
Total weighted average shares outstanding, including OP Units |
|
|
79,111 |
|
|
|
|
|
78,387 |
|
|
|
|
|
78,931 |
|
|
|
|
|
78,288 |
|
(1) Non-GAAP measures. See definitions on page 40.
(2) Twelve months ended June 30, 2019 and June 30, 2018, respectively.
18
Pennsylvania Real Estate Investment Trust
Condensed Consolidated Balance Sheet
|
|
June 30, 2019 |
|
|
December 31, 2018 |
|
||
(in thousands of dollars) |
|
(unaudited) |
|
|
|
|
|
|
ASSETS: |
|
|
|
|
|
|
|
|
INVESTMENTS IN REAL ESTATE, at cost: |
|
|
|
|
|
|
|
|
Operating properties |
|
$ |
3,069,397 |
|
|
$ |
3,063,531 |
|
Construction in progress |
|
|
150,808 |
|
|
|
115,182 |
|
Land held for development |
|
|
5,881 |
|
|
|
5,881 |
|
Total investments in real estate |
|
|
3,226,086 |
|
|
|
3,184,594 |
|
Accumulated depreciation |
|
|
(1,177,549 |
) |
|
|
(1,118,582 |
) |
Net investments in real estate |
|
|
2,048,537 |
|
|
|
2,066,012 |
|
INVESTMENTS IN PARTNERSHIPS, at equity: |
|
|
153,318 |
|
|
|
131,124 |
|
OTHER ASSETS: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
15,227 |
|
|
|
18,084 |
|
Tenant and other receivables, net |
|
|
34,151 |
|
|
|
38,914 |
|
Intangible assets |
|
|
15,963 |
|
|
|
17,868 |
|
Deferred costs and other assets, net |
|
|
98,255 |
|
|
|
110,805 |
|
Assets held for sale |
|
|
9,482 |
|
|
|
22,307 |
|
Total assets |
|
$ |
2,374,933 |
|
|
$ |
2,405,114 |
|
LIABILITIES: |
|
|
|
|
|
|
|
|
Mortgage loans payable, net |
|
$ |
981,521 |
|
|
$ |
1,047,906 |
|
Term Loans, net |
|
|
547,643 |
|
|
|
547,289 |
|
Revolving Facilities |
|
|
182,000 |
|
|
|
65,000 |
|
Tenants’ deposits and deferred rent |
|
|
9,243 |
|
|
|
15,400 |
|
Distributions in excess of partnership investments |
|
|
89,652 |
|
|
|
92,057 |
|
Fair value of derivative liabilities |
|
|
13,577 |
|
|
|
3,010 |
|
Accrued expenses and other liabilities |
|
|
88,447 |
|
|
|
87,901 |
|
Total liabilities |
|
|
1,912,083 |
|
|
|
1,858,563 |
|
EQUITY: |
|
|
|
|
|
|
|
|
Total equity |
|
|
462,850 |
|
|
|
546,551 |
|
Total liabilities and equity |
|
$ |
2,374,933 |
|
|
$ |
2,405,114 |
|
19
Pennsylvania Real Estate Investment Trust
Assets and Liabilities - Equity Method Investments, at Ownership Share (Non-GAAP)
(in thousands)
(in thousands of dollars) |
|
June 30, 2019 |
|
|
December 31, 2018 |
|
||
ASSETS: |
|
|
|
|
|
|
|
|
Investments in real estate, at cost: |
|
|
|
|
|
|
|
|
Operating properties |
|
$ |
276,446 |
|
|
$ |
276,977 |
|
Construction in progress |
|
|
231,668 |
|
|
|
211,637 |
|
Total investments in real estate |
|
|
508,114 |
|
|
|
488,614 |
|
Accumulated depreciation |
|
|
(108,806 |
) |
|
|
(106,066 |
) |
Net investments in real estate |
|
|
399,308 |
|
|
|
382,548 |
|
Cash and cash equivalents |
|
|
13,938 |
|
|
|
9,283 |
|
Deferred costs and other assets, net |
|
|
16,110 |
|
|
|
14,564 |
|
Total assets |
|
|
429,356 |
|
|
|
406,395 |
|
LIABILITIES AND PARTNERS’ INVESTMENT: |
|
|
|
|
|
|
|
|
Mortgage loans payable, net |
|
|
228,508 |
|
|
|
231,426 |
|
FDP Term Loan, net |
|
|
125,000 |
|
|
|
125,000 |
|
Other liabilities |
|
|
12,182 |
|
|
|
10,902 |
|
Total liabilities |
|
|
365,690 |
|
|
|
367,328 |
|
Net investment |
|
$ |
63,666 |
|
|
$ |
39,067 |
|
Reconciliation to comparable GAAP balance sheet item: |
|
|
|
|
|
|
|
|
Investment in partnerships, at equity |
|
$ |
153,318 |
|
|
$ |
131,124 |
|
Distributions in excess of partnership investments |
|
|
(89,652 |
) |
|
|
(92,057 |
) |
Net investment |
|
$ |
63,666 |
|
|
$ |
39,067 |
|
The non-GAAP financial information presented above includes financial information attributable to our share of unconsolidated properties. This proportionate financial information is non-GAAP financial information, but we believe that it is helpful information because it reflects the pro rata contribution from our unconsolidated properties that are owned through investments accounted for under GAAP using the equity method of accounting. Under such method, our investments in these entities are recorded in the balance sheet caption entitled “Investment in partnerships, at equity.” In the case of deficit investment balances, such amounts are recorded in “Distributions in excess of partnership investments.”
To derive the proportionate financial information reflected in the tables above we multiplied the percentage of our economic interest in each partnership on a property-by-property basis by each line item. Under the partnership agreements relating to our current unconsolidated partnerships with third parties, we own a 25% to 50% economic interest in such partnerships, and there are generally no provisions in such partnership agreements relating to special non-pro rata allocations of income or loss, and there are no preferred or priority returns of capital or other similar provisions. While this method approximates our indirect economic interest in our pro rata share of the assets and liabilities of our unconsolidated partnerships, we do not control these partnerships or have a direct legal claim to the assets, liabilities, revenues or expenses of the unconsolidated partnerships beyond our rights as an equity owner in the event of any liquidation of such entity. Our percentage ownership is not necessarily indicative of the legal and economic implications of our ownership interest.
20
Pennsylvania Real Estate Investment Trust
Leasing Activity Summary – Three Months Ended June 30, 2019
|
|
|
|
Number |
|
|
GLA |
|
|
Term |
|
|
Initial Rent per square foot ("psf") |
|
|
Previous Rent psf |
|
|
Initial Gross Rent Renewal Spread(1) |
|
|
Average Rent Renewal Spread(2) |
|
|
Annualized Tenant Improvements psf(3) |
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
% |
|
|
% |
|
|
|
|
|
|||
Non Anchor |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Leases |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Under 10k square feet ("sf") |
|
Consolidated |
|
|
38 |
|
|
|
80,837 |
|
|
|
5.1 |
|
|
$ |
40.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
10.99 |
|
|
|
Unconsolidated(4) |
|
|
4 |
|
|
|
15,346 |
|
|
|
3.7 |
|
|
|
46.19 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
Total Under 10k sf |
|
|
|
|
42 |
|
|
|
96,183 |
|
|
|
4.9 |
|
|
$ |
41.31 |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
$ |
9.66 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Over 10k sf |
|
Consolidated |
|
|
1 |
|
|
|
12,147 |
|
|
|
10.0 |
|
|
$ |
38.79 |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
$ |
- |
|
||||
Total New Leases |
|
|
|
|
43 |
|
|
|
108,330 |
|
|
|
5.4 |
|
|
$ |
41.02 |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
$ |
7.67 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Renewal Leases |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Under 10k sf |
|
Consolidated |
|
|
26 |
|
|
|
51,466 |
|
|
|
2.8 |
|
|
$ |
54.23 |
|
|
$ |
52.16 |
|
|
$ |
2.07 |
|
|
|
4.0 |
% |
|
|
9.8 |
% |
|
$ |
2.76 |
|
|
|
Unconsolidated(4) |
|
|
5 |
|
|
|
21,576 |
|
|
|
3.9 |
|
|
|
58.89 |
|
|
|
67.58 |
|
|
|
(8.69 |
) |
|
|
(12.9 |
%) |
|
|
(1.6 |
%) |
|
|
3.34 |
|
Total Under 10k sf |
|
|
|
|
31 |
|
|
|
73,042 |
|
|
|
3.1 |
|
|
$ |
55.61 |
|
|
$ |
56.71 |
|
|
$ |
(1.11 |
) |
|
|
(2.0 |
%) |
|
|
5.6 |
% |
|
$ |
2.98 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Over 10k sf |
|
Consolidated |
|
|
2 |
|
|
|
52,012 |
|
|
|
5.0 |
|
|
$ |
10.31 |
|
|
$ |
9.53 |
|
|
$ |
0.78 |
|
|
|
8.2 |
% |
|
|
9.5 |
% |
|
|
|
|
Total Fixed Rent |
|
|
|
|
33 |
|
|
|
125,054 |
|
|
|
3.9 |
|
|
$ |
36.77 |
|
|
$ |
37.09 |
|
|
$ |
(0.32 |
) |
|
|
(0.9 |
%) |
|
|
6.1 |
% |
|
$ |
1.39 |
|
Percentage in Lieu |
|
Consolidated |
|
|
8 |
|
|
|
24,855 |
|
|
|
1.5 |
|
|
$ |
25.40 |
|
|
$ |
50.30 |
|
|
$ |
(24.90 |
) |
|
|
(49.5 |
%) |
|
n/a |
|
|
$ |
- |
|
|
Total Renewal Leases |
|
|
|
|
41 |
|
|
|
149,909 |
|
|
|
3.5 |
|
|
$ |
34.88 |
|
|
$ |
39.28 |
|
|
$ |
(4.40 |
) |
|
|
(11.2 |
%) |
|
|
6.1 |
% |
|
$ |
1.29 |
|
Total Non Anchor |
|
|
|
|
84 |
|
|
|
258,239 |
|
|
|
4.3 |
|
|
$ |
37.46 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anchor |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Leases |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
$ |
- |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|||||
Renewal Leases |
|
Consolidated |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|||||
Total |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Initial gross rent renewal spread is computed by comparing the initial rent psf in the new lease to the final rent psf amount in the expiring lease. For purposes of this computation, the rent amount includes minimum rent, CAM charges, estimated real estate tax reimbursements and marketing charges, but excludes percentage rent. In certain cases, a lower rent amount may be payable for a period of time until specified conditions in the lease are satisfied. |
(2) |
Average rent renewal spread is computed by comparing the average rent psf over the new lease term to the final rent psf amount in the expiring lease. For purposes of this computation, the rent amount includes minimum rent and fixed CAM charges, but excludes pro rata CAM charges, estimated real estate tax reimbursements, marketing charges and percentage rent. |
(3) |
Tenant improvements and certain other leasing costs are presented as annualized amounts per square foot and are spread uniformly over the initial lease term. |
(4) |
We own a 25% to 50% interest in each of our unconsolidated properties and do not control such properties. Our percentage ownership is not necessarily indicative of the legal and economic implications of our ownership interest. See “—Use of Non-GAAP Measures” for further details on our ownership interests in our unconsolidated properties. |
21
Pennsylvania Real Estate Investment Trust
Leasing Activity Summary – Six Months Ended June 30, 2019
|
|
|
|
Number |
|
|
GLA |
|
|
Term |
|
|
Initial Rent per square foot ("psf") |
|
|
Previous Rent psf |
|
|
Initial Gross Rent Renewal Spread(1) |
|
|
Average Rent Renewal Spread(2) |
|
|
Annualized Tenant Improvements psf(3) |
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
% |
|
|
% |
|
|
|
|
|
|||
Non Anchor |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Leases |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Under 10k square feet ("sf") |
|
Consolidated |
|
|
57 |
|
|
|
151,548 |
|
|
|
7.0 |
|
|
$ |
41.13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
13.64 |
|
|
|
Unconsolidated(4) |
|
|
5 |
|
|
|
20,846 |
|
|
|
5.7 |
|
|
|
47.17 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12.75 |
|
Total Under 10k sf |
|
|
|
|
62 |
|
|
|
172,394 |
|
|
|
6.8 |
|
|
$ |
41.86 |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
$ |
13.55 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Over 10k sf |
|
Consolidated |
|
|
2 |
|
|
|
32,238 |
|
|
|
9.4 |
|
|
|
19.73 |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
|
- |
|
||||
Total New Leases |
|
|
|
|
64 |
|
|
|
204,632 |
|
|
|
7.2 |
|
|
$ |
38.37 |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
$ |
10.81 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Renewal Leases |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Under 10k sf |
|
Consolidated |
|
|
52 |
|
|
|
115,299 |
|
|
|
3.2 |
|
|
$ |
57.11 |
|
|
$ |
54.69 |
|
|
$ |
2.42 |
|
|
|
4.4 |
% |
|
|
4.7 |
% |
|
$ |
2.64 |
|
|
|
Unconsolidated(4) |
|
|
8 |
|
|
|
25,301 |
|
|
|
3.6 |
|
|
|
60.93 |
|
|
|
67.99 |
|
|
|
(7.06 |
) |
|
|
(10.4 |
%) |
|
|
(0.7 |
%) |
|
|
3.12 |
|
Total Under 10k sf |
|
|
|
|
60 |
|
|
|
140,600 |
|
|
|
3.3 |
|
|
$ |
57.80 |
|
|
$ |
57.08 |
|
|
$ |
0.71 |
|
|
|
1.3 |
% |
|
|
3.5 |
% |
|
$ |
2.74 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Over 10k sf |
|
Consolidated |
|
|
6 |
|
|
|
132,171 |
|
|
|
4.9 |
|
|
$ |
12.94 |
|
|
$ |
12.25 |
|
|
$ |
0.69 |
|
|
|
5.6 |
% |
|
|
6.3 |
% |
|
$ |
0.66 |
|
Total Fixed Rent |
|
|
|
|
66 |
|
|
|
272,771 |
|
|
|
4.0 |
|
|
$ |
36.06 |
|
|
$ |
35.36 |
|
|
$ |
0.70 |
|
|
|
2.0 |
% |
|
|
4.0 |
% |
|
$ |
1.52 |
|
Percentage in Lieu |
|
Consolidated |
|
|
40 |
|
|
|
145,682 |
|
|
|
1.8 |
|
|
$ |
29.87 |
|
|
$ |
44.83 |
|
|
$ |
(14.96 |
) |
|
|
(33.4 |
%) |
|
n/a |
|
|
$ |
- |
|
|
Total Renewal Leases |
|
|
|
|
106 |
|
|
|
418,453 |
|
|
|
3.3 |
|
|
$ |
33.91 |
|
|
$ |
38.66 |
|
|
$ |
(4.75 |
) |
|
|
(12.3 |
%) |
|
|
4.0 |
% |
|
$ |
1.23 |
|
Total Non Anchor |
|
|
|
|
170 |
|
|
|
623,085 |
|
|
|
4.6 |
|
|
$ |
35.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anchor |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Leases |
|
|
|
|
1 |
|
|
|
43,840 |
|
|
|
10.4 |
|
|
$ |
16.50 |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
$ |
11.62 |
|
||||
Renewal Leases |
|
Consolidated |
|
|
6 |
|
|
|
629,743 |
|
|
|
3.8 |
|
|
|
3.48 |
|
|
$ |
4.26 |
|
|
$ |
(0.78 |
) |
|
|
(18.3 |
%) |
|
n/a |
|
|
$ |
- |
|
|
Total |
|
|
|
|
7 |
|
|
|
673,583 |
|
|
|
4.2 |
|
|
$ |
4.33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Initial gross rent renewal spread is computed by comparing the initial rent psf in the new lease to the final rent psf amount in the expiring lease. For purposes of this computation, the rent amount includes minimum rent, CAM charges, estimated real estate tax reimbursements and marketing charges, but excludes percentage rent. In certain cases, a lower rent amount may be payable for a period of time until specified conditions in the lease are satisfied. |
(2) |
Average rent renewal spread is computed by comparing the average rent psf over the new lease term to the final rent psf amount in the expiring lease. For purposes of this computation, the rent amount includes minimum rent and fixed CAM charges, but excludes pro rata CAM charges, estimated real estate tax reimbursements, marketing charges and percentage rent. |
(3) |
Tenant improvements and certain other leasing costs are presented as annualized amounts per square foot and are spread uniformly over the initial lease term. |
(4) |
We own a 25% to 50% interest in each of our unconsolidated properties and do not control such properties. Our percentage ownership is not necessarily indicative of the legal and economic implications of our ownership interest. See “—Use of Non-GAAP Measures” for further details on our ownership interests in our unconsolidated properties. |
22
Pennsylvania Real Estate Investment Trust
Summarized Sales and Rent Per Square Foot and Occupancy Percentages
|
June 30, 2019 |
|
|
June 30, 2018 |
|
||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Actual Occupancy |
|
|
Leased Occupancy |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Actual Occupancy |
|
|||||||||||||||
|
% Rolling 12 Mo. NOI |
|
|
Average Comp Sales |
|
|
Average Gross Rent(1)(2) |
|
|
Occupancy Cost |
|
|
Total |
|
|
Non-Anchor |
|
|
Total |
|
|
Non-Anchor |
|
|
% Rolling 12 Mo. NOI |
|
|
Average Comp Sales |
|
|
Average Gross Rent(1)(2) |
|
|
Occupancy Cost |
|
|
Total |
|
|
Non-Anchor |
|
||||||||||||||
Malls |
|
87.4 |
% |
|
$ |
531 |
|
|
$ |
60.47 |
|
|
|
12.5 |
% |
|
|
93.7 |
% |
|
|
89.9 |
% |
|
|
94.6 |
% |
|
|
91.2 |
% |
|
|
84.6 |
% |
|
$ |
503 |
|
|
$ |
61.07 |
|
|
|
13.0 |
% |
|
|
93.7 |
% |
|
|
91.7 |
% |
Non-Core Malls |
|
7.3 |
% |
|
363 |
|
|
47.34 |
|
|
|
12.8 |
% |
|
|
70.2 |
% |
|
|
76.4 |
% |
|
|
70.7 |
% |
|
|
77.6 |
% |
|
|
8.5 |
% |
|
350 |
|
|
48.45 |
|
|
|
13.9 |
% |
|
|
90.4 |
% |
|
|
83.7 |
% |
||||
Malls Total |
|
94.7 |
% |
|
$ |
513 |
|
|
$ |
59.20 |
|
|
|
12.5 |
% |
|
|
90.2 |
% |
|
|
88.5 |
% |
|
|
91.2 |
% |
|
|
89.9 |
% |
|
|
93.1 |
% |
|
$ |
485 |
|
|
$ |
59.71 |
|
|
|
13.1 |
% |
|
|
93.2 |
% |
|
|
90.8 |
% |
Other Retail Properties |
|
5.3 |
% |
|
n/a |
|
|
24.53 |
|
|
— |
|
|
|
93.1 |
% |
|
|
92.5 |
% |
|
|
93.1 |
% |
|
|
92.5 |
% |
|
|
5.2 |
% |
|
n/a |
|
|
24.97 |
|
|
n/a |
|
|
|
91.2 |
% |
|
|
90.5 |
% |
||||||
Total Retail Properties |
|
100.0 |
% |
|
n/a |
|
|
$ |
49.63 |
|
|
n/a |
|
|
|
90.6 |
% |
|
|
89.2 |
% |
|
|
91.4 |
% |
|
|
90.3 |
% |
|
|
98.3 |
% |
|
n/a |
|
|
$ |
50.61 |
|
|
n/a |
|
|
|
92.9 |
% |
|
|
90.8 |
% |
||||
Sold Properties |
— |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
|
0.5 |
% |
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|||||||||||||
Other Properties (3) |
— |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
|
1.2 |
% |
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
n/a |
|
|||||||||||||
Total Portfolio |
|
100.0 |
% |
|
$ |
513 |
|
|
$ |
49.63 |
|
|
|
12.5 |
% |
|
|
90.6 |
% |
|
|
89.2 |
% |
|
|
91.4 |
% |
|
|
90.3 |
% |
|
|
100.0 |
% |
|
$ |
485 |
|
|
$ |
50.61 |
|
|
|
13.1 |
% |
|
|
92.9 |
% |
|
|
90.8 |
% |
|
(1) |
Average gross rent for malls includes all non-anchor space owned by the Company and leased to tenants that occupy individual spaces of less than 10,000 square feet. Average gross rent for other retail properties includes all non-anchor space owned by the Company regardless of size. |
|
(2) |
Average gross rent for mall tenants greater than 10,000 sf was $22.11 per square foot as of June 30, 2019 and $22.28 per square foot as of June 30, 2018. |
|
(3) |
Operating metrics for Fashion District Philadelphia as of June 30, 2019 and 2018, respectively, are excluded because the property is under redevelopment. |
23
Pennsylvania Real Estate Investment Trust
Mall Occupancy Percentage and Sales Per Square Foot
|
|
June 30, 2019 |
|
|
June 30, 2018 |
|
|
Change |
|
|||||||||||||||||||||||||||||||
|
|
% of Mall NOI |
|
|
Avg Comp Sales (1) |
|
|
Total Occupancy % |
|
|
Non-Anchor Occupancy % |
|
|
Avg Comp Sales (1) |
|
|
Total Occupancy % |
|
|
Non-Anchor Occupancy % |
|
|
Avg Comp Sales (1) |
|
|
Total Occupancy % |
|
|
Non-Anchor Occupancy % |
|
||||||||||
Top 6 Malls |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Willow Grove Park |
|
|
6.3 |
% |
|
$ |
763 |
|
|
|
94.0 |
% |
|
|
89.6 |
% |
|
$ |
707 |
|
|
|
94.6 |
% |
|
|
90.7 |
% |
|
|
7.9 |
% |
|
|
(0.5 |
%) |
|
|
(1.1 |
%) |
Cherry Hill Mall |
|
|
14.0 |
% |
|
699 |
|
|
|
94.5 |
% |
|
|
93.4 |
% |
|
662 |
|
|
|
95.7 |
% |
|
|
94.8 |
% |
|
|
5.6 |
% |
|
|
(1.2 |
%) |
|
|
(1.4 |
%) |
||
Woodland Mall |
|
|
5.7 |
% |
|
619 |
|
|
|
96.1 |
% |
|
|
96.1 |
% |
|
539 |
|
|
|
95.9 |
% |
|
|
95.9 |
% |
|
|
14.8 |
% |
|
|
0.2 |
% |
|
|
0.2 |
% |
||
Lehigh Valley Mall |
|
|
5.9 |
% |
|
584 |
|
|
|
90.7 |
% |
|
|
84.9 |
% |
|
573 |
|
|
|
94.5 |
% |
|
|
91.0 |
% |
|
|
1.9 |
% |
|
|
(3.7 |
%) |
|
|
(6.1 |
%) |
||
The Mall at Prince Georges |
|
|
6.8 |
% |
|
557 |
|
|
|
98.7 |
% |
|
|
97.3 |
% |
|
530 |
|
|
|
97.5 |
% |
|
|
94.7 |
% |
|
|
5.1 |
% |
|
|
1.2 |
% |
|
|
2.6 |
% |
||
Springfield Town Center |
|
|
10.2 |
% |
|
546 |
|
|
|
92.6 |
% |
|
|
90.1 |
% |
|
544 |
|
|
|
91.7 |
% |
|
|
88.9 |
% |
|
|
0.4 |
% |
|
|
0.9 |
% |
|
|
1.2 |
% |
||
|
|
|
48.8 |
% |
|
$ |
633 |
|
|
|
94.3 |
% |
|
|
91.6 |
% |
|
$ |
601 |
|
|
|
94.8 |
% |
|
|
92.4 |
% |
|
|
5.3 |
% |
|
|
(0.5 |
%) |
|
|
(0.8 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Malls 7-12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dartmouth Mall |
|
|
3.7 |
% |
|
533 |
|
|
|
96.8 |
% |
|
|
94.7 |
% |
|
509 |
|
|
|
95.0 |
% |
|
|
91.8 |
% |
|
|
4.7 |
% |
|
|
1.8 |
% |
|
|
2.9 |
% |
||
Jacksonville Mall |
|
|
3.9 |
% |
|
497 |
|
|
|
97.7 |
% |
|
|
95.4 |
% |
|
522 |
|
|
|
99.6 |
% |
|
|
99.1 |
% |
|
|
(4.8 |
%) |
|
|
(1.9 |
%) |
|
|
(3.7 |
%) |
||
Magnolia Mall |
|
|
3.2 |
% |
|
479 |
|
|
|
97.4 |
% |
|
|
95.6 |
% |
|
440 |
|
|
|
94.0 |
% |
|
|
89.8 |
% |
|
|
8.9 |
% |
|
|
3.4 |
% |
|
|
5.8 |
% |
||
Viewmont Mall |
|
|
4.1 |
% |
|
450 |
|
|
|
96.2 |
% |
|
|
92.1 |
% |
|
432 |
|
|
|
99.6 |
% |
|
|
99.1 |
% |
|
|
4.2 |
% |
|
|
(3.4 |
%) |
|
|
(7.0 |
%) |
||
Capital City Mall |
|
|
4.6 |
% |
|
447 |
|
|
|
95.7 |
% |
|
|
93.5 |
% |
|
404 |
|
|
|
92.9 |
% |
|
|
89.2 |
% |
|
|
10.6 |
% |
|
|
2.8 |
% |
|
|
4.3 |
% |
||
Patrick Henry Mall |
|
|
4.3 |
% |
|
436 |
|
|
|
92.0 |
% |
|
|
88.4 |
% |
|
407 |
|
|
|
94.5 |
% |
|
|
92.0 |
% |
|
|
7.1 |
% |
|
|
(2.5 |
%) |
|
|
(3.6 |
%) |
||
|
|
|
23.8 |
% |
|
$ |
467 |
|
|
|
96.1 |
% |
|
|
93.4 |
% |
|
$ |
443 |
|
|
|
95.9 |
% |
|
|
93.1 |
% |
|
|
5.5 |
% |
|
|
0.2 |
% |
|
|
0.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Malls 13-18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Valley Mall |
|
|
4.1 |
% |
|
420 |
|
|
|
96.8 |
% |
|
|
93.6 |
% |
|
401 |
|
|
|
79.3 |
% |
|
|
95.5 |
% |
|
|
4.7 |
% |
|
|
17.5 |
% |
|
|
(2.0 |
%) |
||
Springfield Mall |
|
|
1.6 |
% |
|
416 |
|
|
|
90.0 |
% |
|
|
90.0 |
% |
|
419 |
|
|
|
95.9 |
% |
|
|
95.9 |
% |
|
|
(0.7 |
%) |
|
|
(5.8 |
%) |
|
|
(5.8 |
%) |
||
Moorestown Mall |
|
|
3.3 |
% |
|
413 |
|
|
|
92.4 |
% |
|
|
82.4 |
% |
|
401 |
|
|
|
90.6 |
% |
|
|
79.6 |
% |
|
|
3.0 |
% |
|
|
1.8 |
% |
|
|
2.8 |
% |
||
Cumberland Mall |
|
|
3.1 |
% |
|
397 |
|
|
|
85.8 |
% |
|
|
76.8 |
% |
|
367 |
|
|
|
96.0 |
% |
|
|
93.5 |
% |
|
|
8.2 |
% |
|
|
(10.2 |
%) |
|
|
(16.7 |
%) |
||
Francis Scott Key Mall |
|
|
3.5 |
% |
|
376 |
|
|
|
92.3 |
% |
|
|
87.9 |
% |
|
366 |
|
|
|
93.6 |
% |
|
|
89.9 |
% |
|
|
2.7 |
% |
|
|
(1.3 |
%) |
|
|
(2.0 |
%) |
||
Plymouth Meeting Mall |
|
|
4.1 |
% |
|
345 |
|
|
|
87.8 |
% |
|
|
81.3 |
% |
|
351 |
|
|
|
90.0 |
% |
|
|
84.8 |
% |
|
|
(1.7 |
%) |
|
|
(2.3 |
%) |
|
|
(3.5 |
%) |
||
|
|
|
19.8 |
% |
|
$ |
396 |
|
|
|
91.2 |
% |
|
|
84.8 |
% |
|
$ |
386 |
|
|
|
90.2 |
% |
|
|
89.5 |
% |
|
|
2.5 |
% |
|
|
1.0 |
% |
|
|
(4.7 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Core Malls |
|
|
92.3 |
% |
|
$ |
531 |
|
|
|
93.7 |
% |
|
|
89.9 |
% |
|
$ |
503 |
|
|
|
93.7 |
% |
|
|
91.7 |
% |
|
|
5.6 |
% |
|
|
0.0 |
% |
|
|
(1.8 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Core Malls |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wyoming Valley Mall |
|
|
2.8 |
% |
|
$ |
389 |
|
|
|
64.5 |
% |
|
|
83.6 |
% |
|
$ |
376 |
|
|
|
96.8 |
% |
|
|
88.8 |
% |
|
|
3.5 |
% |
|
|
(32.3 |
%) |
|
|
(5.2 |
%) |
Valley View Mall |
|
|
2.0 |
% |
|
359 |
|
|
|
68.9 |
% |
|
|
87.5 |
% |
|
373 |
|
|
|
95.0 |
% |
|
|
90.3 |
% |
|
|
(3.8 |
%) |
|
|
(26.1 |
%) |
|
|
(2.8 |
%) |
||
Exton Square Mall |
|
|
2.8 |
% |
|
338 |
|
|
|
76.7 |
% |
|
|
65.1 |
% |
|
312 |
|
|
|
82.1 |
% |
|
|
77.5 |
% |
|
|
8.3 |
% |
|
|
(5.4 |
%) |
|
|
(12.5 |
%) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Non-Core Malls |
|
|
7.7 |
% |
|
$ |
363 |
|
|
|
70.2 |
% |
|
|
76.4 |
% |
|
$ |
350 |
|
|
|
90.4 |
% |
|
|
83.7 |
% |
|
|
3.7 |
% |
|
|
(20.2 |
%) |
|
|
(7.3 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Malls |
|
|
100.0 |
% |
|
$ |
513 |
|
|
|
90.2 |
% |
|
|
88.5 |
% |
|
$ |
485 |
|
|
|
93.2 |
% |
|
|
90.8 |
% |
|
|
5.8 |
% |
|
|
(3.0 |
%) |
|
|
(2.3 |
%) |
|
(1) |
Based on reported sales by all comparable non-anchor tenants that lease individual spaces of less than 10,000 square feet and have occupied the space for at least 24 months. |
24
Pennsylvania Real Estate Investment Trust
Top Twenty Tenants
June 30, 2019
Tenant |
|
Brands |
|
Locations at Consolidated Properties |
|
|
Locations at Unconsolidated Properties |
|
Total Number of Locations (1) |
|
|
Percentage of Annualized Gross Rent (2) |
|
|||
Foot Locker, Inc. |
|
Champs, Foot Locker, Footaction, House of Hoops by Foot Locker, Kids Foot Locker, Lady Foot Locker, Nike Yardline, Footaction Flight 23 |
|
42 |
|
|
8 |
|
50 |
|
|
|
4.4 |
% |
||
L Brands, Inc. |
|
Bath & Body Works, Pink, Victoria's Secret |
|
38 |
|
|
6 |
|
44 |
|
|
|
3.9 |
% |
||
Signet Jewelers Limited |
|
Kay Jewelers, Piercing Pagoda, Totally Pagoda, Zales Jewelers, Silver & Gold Connection |
|
58 |
|
|
9 |
|
67 |
|
|
|
3.2 |
% |
||
American Eagle Outfitters, Inc. |
|
Aerie, American Eagle Outfitters |
|
17 |
|
|
4 |
|
21 |
|
|
|
2.6 |
% |
||
Dick's Sporting Goods, Inc. |
|
Dick's Sporting Goods, Field & Stream |
|
9 |
|
|
2 |
|
11 |
|
|
|
2.6 |
% |
||
Express, Inc |
|
Express, Express Factory Outlet, Express Men |
|
14 |
|
|
3 |
|
17 |
|
|
|
2.1 |
% |
||
Forever 21, Inc. |
|
Forever 21 |
|
11 |
|
|
2 |
|
13 |
|
|
|
2.0 |
% |
||
Gap, Inc. |
|
Banana Republic, Gap/Gap Kids/Gap Outlet, Old Navy |
|
13 |
|
|
9 |
|
22 |
|
|
|
1.8 |
% |
||
J.C. Penney Company, Inc. |
|
JC Penney |
|
14 |
|
|
2 |
|
16 |
|
|
|
1.7 |
% |
||
Macy's |
|
Bloomingdale's, Macy's |
|
15 |
|
|
2 |
|
17 |
|
|
|
1.7 |
% |
||
Luxottica Group S.p.A. |
|
Lenscrafters, Pearle Vision, Sunglass Hut |
|
27 |
|
|
6 |
|
33 |
|
|
|
1.4 |
% |
||
Genesco Inc. |
|
Johnston & Murphy, Journeys, Journeys Kidz, Underground by Journeys |
|
28 |
|
|
4 |
|
32 |
|
|
|
1.4 |
% |
||
Cineworld Group |
|
Regal Cinemas |
|
4 |
|
|
0 |
|
4 |
|
|
|
1.4 |
% |
||
Ascena Retail Group, Inc. |
|
Ann Taylor, Dress Barn, Justice, Lane Bryant, Loft, Maurices |
|
25 |
|
|
5 |
|
30 |
|
|
|
1.4 |
% |
||
Dave & Buster's, Inc. |
|
Dave & Buster's |
|
3 |
|
|
0 |
|
3 |
|
|
|
1.4 |
% |
||
H&M Hennes & Mauritz L.P. |
|
H&M |
|
14 |
|
|
0 |
|
14 |
|
|
|
1.2 |
% |
||
Darden Concepts, Inc. |
|
Bahama Breeze, Capital Grille, Olive Garden, Seasons 52, Yard House |
|
8 |
|
|
0 |
|
8 |
|
|
|
1.2 |
% |
||
The Children's Place, Inc. |
|
The Children's Place |
|
14 |
|
|
2 |
|
16 |
|
|
|
1.1 |
% |
||
Shoe Show, Inc. |
|
Shoe Department, Shoe Dept. Encore |
|
15 |
|
|
2 |
|
17 |
|
|
|
1.1 |
% |
||
The TJX Companies, Inc. |
|
HomeGoods, HomeSense, Marshalls, Sierra Trading Post, TJ Maxx |
|
7 |
|
|
1 |
|
|
8 |
|
|
|
1.0 |
% |
|
Total Top 20 Tenants |
|
|
|
376 |
|
|
67 |
|
443 |
|
|
|
38.6 |
% |
||
Total Leases |
|
|
|
|
1,524 |
|
|
321 |
|
|
1,845 |
|
|
|
100.0 |
% |
|
(1) |
Excludes tenants from Fashion District Philadelphia. |
|
(2) |
Includes our share of tenant gross rent from partnership properties based on PREIT’s ownership percentage in the respective equity method investments as of June 30, 2019. |
25
Pennsylvania Real Estate Investment Trust
Lease Expirations as of June 30, 2019
(dollars in thousands except per square foot (“psf”) amounts)
Non-Anchors (1) |
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
Gross Leasable Area ("GLA") |
|
|
Annualized Gross Rent |
|
|
|
|
|
||||||||||||||
Lease Expiration Year |
|
Number of Leases Expiring |
|
|
Expiring GLA (2) |
|
|
Percent of Total |
|
|
Gross Rent in Expiring Year |
|
|
PREIT’s Share of Gross Rent in Expiring Year (3) |
|
|
Percent of PREIT’s Total |
|
|
Average Expiring Gross Rent psf |
|
|||||||
2019 and Prior |
|
211 |
|
|
|
429,890 |
|
|
|
5.2 |
% |
|
$ |
25,275 |
|
|
$ |
23,003 |
|
|
|
7.4 |
% |
|
$ |
58.79 |
|
|
2020 |
|
264 |
|
|
|
1,177,961 |
|
|
|
14.1 |
% |
|
|
42,437 |
|
|
|
37,205 |
|
|
|
11.9 |
% |
|
|
36.03 |
|
|
2021 |
|
230 |
|
|
|
1,012,648 |
|
|
|
12.1 |
% |
|
|
37,368 |
|
|
|
31,649 |
|
|
|
10.1 |
% |
|
|
36.90 |
|
|
2022 |
|
179 |
|
|
|
574,782 |
|
|
|
6.9 |
% |
|
|
30,236 |
|
|
|
26,254 |
|
|
|
8.4 |
% |
|
|
52.60 |
|
|
2023 |
|
173 |
|
|
|
1,054,224 |
|
|
|
12.6 |
% |
|
|
40,038 |
|
|
|
35,545 |
|
|
|
11.4 |
% |
|
|
37.98 |
|
|
2024 |
|
147 |
|
|
|
704,963 |
|
|
|
8.4 |
% |
|
|
37,669 |
|
|
|
34,623 |
|
|
|
11.1 |
% |
|
|
53.43 |
|
|
2025 |
|
157 |
|
|
|
743,299 |
|
|
|
8.9 |
% |
|
|
39,374 |
|
|
|
31,788 |
|
|
|
10.2 |
% |
|
|
52.97 |
|
|
2026 |
|
117 |
|
|
|
597,063 |
|
|
|
7.2 |
% |
|
|
30,975 |
|
|
|
24,428 |
|
|
|
7.8 |
% |
|
|
51.88 |
|
|
2027 |
|
100 |
|
|
|
664,908 |
|
|
|
8.0 |
% |
|
|
26,437 |
|
|
|
24,449 |
|
|
|
7.8 |
% |
|
|
39.76 |
|
|
2028 |
|
79 |
|
|
|
654,815 |
|
|
|
7.8 |
% |
|
|
22,897 |
|
|
|
21,588 |
|
|
|
6.9 |
% |
|
|
34.97 |
|
|
Thereafter |
|
71 |
|
|
|
732,559 |
|
|
|
8.8 |
% |
|
|
23,376 |
|
|
|
22,168 |
|
|
|
7.1 |
% |
|
|
31.91 |
|
|
Total/Average |
|
|
1,728 |
|
|
|
8,347,112 |
|
|
|
100.0 |
% |
|
$ |
356,082 |
|
|
$ |
312,700 |
|
|
|
100.0 |
% |
|
$ |
42.66 |
|
Anchors(1) |
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
Gross Leasable Area ("GLA") |
|
|
Annualized Gross Rent |
|
|
|
|
|
||||||||||||||
Lease Expiration Year |
|
Number of Leases Expiring |
|
|
Expiring GLA (2) |
|
|
Percent of Total |
|
|
Gross Rent in Expiring Year |
|
|
PREIT’s Share of Gross Rent in Expiring Year (3) |
|
|
Percent of PREIT’s Total |
|
|
Average Expiring Gross Rent psf |
|
|||||||
2019 and Prior |
|
2 |
|
|
|
252,741 |
|
|
|
4.7 |
% |
|
$ |
452 |
|
|
$ |
452 |
|
|
|
1.7 |
% |
|
$ |
1.79 |
|
|
2020 |
|
4 |
|
|
|
383,752 |
|
|
|
7.1 |
% |
|
|
1,511 |
|
|
|
1,511 |
|
|
|
5.7 |
% |
|
|
3.94 |
|
|
2021 |
|
6 |
|
|
|
567,179 |
|
|
|
10.5 |
% |
|
|
3,584 |
|
|
|
2,366 |
|
|
|
9.0 |
% |
|
|
6.32 |
|
|
2022 |
|
9 |
|
|
|
1,321,215 |
|
|
|
24.5 |
% |
|
|
4,660 |
|
|
|
4,305 |
|
|
|
16.4 |
% |
|
|
3.53 |
|
|
2023 |
|
3 |
|
|
|
348,592 |
|
|
|
6.5 |
% |
|
|
1,894 |
|
|
|
1,894 |
|
|
|
7.2 |
% |
|
|
5.43 |
|
|
2024 |
|
5 |
|
|
|
702,674 |
|
|
|
13.0 |
% |
|
|
3,226 |
|
|
|
3,226 |
|
|
|
12.3 |
% |
|
|
4.59 |
|
|
2025 |
|
4 |
|
|
|
635,169 |
|
|
|
11.8 |
% |
|
|
2,211 |
|
|
|
2,211 |
|
|
|
8.4 |
% |
|
|
3.48 |
|
|
2026 |
|
1 |
|
|
|
58,371 |
|
|
|
1.1 |
% |
|
|
861 |
|
|
|
861 |
|
|
|
3.3 |
% |
|
|
14.75 |
|
|
2027 |
|
0 |
|
|
|
0 |
|
|
|
0.0 |
% |
|
|
0 |
|
|
|
0 |
|
|
|
0.0 |
% |
|
|
- |
|
|
2028 |
|
9 |
|
|
|
982,424 |
|
|
|
18.2 |
% |
|
|
6,698 |
|
|
|
6,698 |
|
|
|
25.5 |
% |
|
|
6.82 |
|
|
Thereafter |
|
2 |
|
|
|
135,155 |
|
|
|
2.5 |
% |
|
|
2,791 |
|
|
|
2,791 |
|
|
|
10.6 |
% |
|
|
20.65 |
|
|
Total/Average |
|
|
45 |
|
|
|
5,387,272 |
|
|
|
100.0 |
% |
|
$ |
27,888 |
|
|
$ |
26,316 |
|
|
|
100.0 |
% |
|
$ |
5.18 |
|
|
(1) |
Only includes owned space. Excludes tenants from Fashion District Philadelphia. |
|
(2) |
Does not include tenants occupying space under license agreements with initial terms of less than one year. The aggregate GLA of these tenants is 413,245 square feet. |
|
(3) |
Includes our share of tenant rent from partnership properties based on PREIT’s ownership percentage in the respective equity method investments. |
26
|
||||||||||||||||||||||||||||||||
Property Information as of June 30, 2019 |
|
|||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Landlord Owned Anchors/ Large Format Non Anchor |
|
|
Anchor Stores Not Owned |
|
|
Non-anchor occupied GLA |
|
|
|
|
|
|
|
|
|
|||||||||||||
Properties |
|
Location |
|
Tenant |
|
Expiration Year |
|
GLA |
|
|
Tenant |
|
GLA |
|
|
Large Format |
|
|
Small Shop |
|
|
Vacant |
|
|
Total GLA |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core Malls |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital City Mall |
|
Camp Hill, PA |
|
JCPenney |
|
2028 |
|
|
102,825 |
|
|
Macy's |
|
|
120,000 |
|
|
|
104,806 |
|
|
|
155,469 |
|
|
|
21,471 |
|
|
|
616,550 |
|
|
|
|
|
Dick's Sporting Goods |
|
2028 |
|
|
61,677 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Field & Stream |
|
2031 |
|
|
|
|
|
|
|
|
|
|
|
|
50,302 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cherry Hill Mall |
|
Cherry Hill, NJ |
|
Nordstrom |
|
2025 |
|
|
138,000 |
|
|
JCPenney |
|
|
174,285 |
|
|
|
227,087 |
|
|
|
424,744 |
|
|
|
45,802 |
|
|
|
1,314,518 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Macy's |
|
|
304,600 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cumberland Mall |
|
Vineland, NJ |
|
Burlington |
|
2020 |
|
|
80,983 |
|
|
BJ's Wholesale Club |
|
|
117,889 |
|
|
|
137,493 |
|
|
|
136,774 |
|
|
|
96,049 |
|
|
|
950,987 |
|
|
|
|
|
The Home Depot |
|
2024 |
|
|
132,013 |
|
|
Boscov's |
|
|
155,341 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dick's Sporting Goods |
|
2028 |
|
|
50,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regal Cinemas |
|
2024 |
|
|
|
|
|
|
|
|
|
|
|
|
44,445 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Dartmouth Mall |
|
Dartmouth, MA |
|
JCPenney |
|
2024 |
|
|
100,020 |
|
|
Macy's |
|
|
140,000 |
|
|
|
129,427 |
|
|
|
132,602 |
|
|
|
17,106 |
|
|
|
672,583 |
|
|
|
|
|
Sears |
|
2019 |
|
|
108,440 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMC Theaters |
|
2026 |
|
|
|
|
|
|
|
|
|
|
|
|
44,988 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Francis Scott Key Mall |
|
Frederick, MD |
|
JCPenney |
|
2021 |
|
|
101,293 |
|
|
Macy's |
|
|
139,333 |
|
|
|
139,863 |
|
|
|
155,294 |
|
|
|
47,443 |
|
|
|
754,259 |
|
|
|
|
|
Sears |
|
2023 |
|
|
120,883 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dick's Sporting Goods |
|
2025 |
|
|
|
|
|
|
|
|
|
|
|
|
50,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Jacksonville Mall |
|
Jacksonville, NC |
|
Belk |
|
2021 |
|
|
72,510 |
|
|
|
|
|
|
|
|
|
123,079 |
|
|
|
117,956 |
|
|
|
11,627 |
|
|
|
494,777 |
|
|
|
|
|
JCPenney |
|
2025 |
|
|
51,812 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sears |
|
2021 |
|
|
117,793 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lehigh Valley Mall |
|
Allentown, PA |
|
Boscov's |
|
2022 |
|
|
164,694 |
|
|
JCPenney |
|
|
207,292 |
|
|
|
141,510 |
|
|
|
344,469 |
|
|
|
89,936 |
|
|
|
1,159,901 |
|
|
|
|
|
Macy's |
|
2022 |
|
|
212,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Magnolia Mall |
|
Florence, SC |
|
Belk |
|
2028 |
|
|
115,793 |
|
|
|
|
|
|
|
|
|
96,175 |
|
|
|
154,238 |
|
|
|
15,829 |
|
|
|
608,885 |
|
|
|
|
|
Best Buy |
|
2023 |
|
|
32,054 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
JCPenney |
|
2022 |
|
|
104,107 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dick's Sporting Goods |
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
45,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Burlington |
|
2028 |
|
|
|
|
|
|
|
|
|
|
|
|
45,689 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Moorestown Mall |
|
Moorestown, NJ |
|
Boscov's |
|
2028 |
|
|
202,765 |
|
|
|
|
|
|
|
|
|
63,039 |
|
|
|
182,355 |
|
|
|
70,825 |
|
|
|
932,104 |
|
|
|
|
|
Lord & Taylor |
|
2020 |
|
|
121,200 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sears |
|
2022 |
|
|
205,591 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regal Cinemas |
|
2028 |
|
|
|
|
|
|
|
|
|
|
|
|
57,843 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HomeSense |
|
2028 |
|
|
28,486 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Patrick Henry Mall |
|
Newport News, VA |
|
Dick's Sporting Goods |
|
2022 |
|
|
50,250 |
|
|
Dillard's |
|
|
144,157 |
|
|
|
60,095 |
|
|
|
203,413 |
|
|
|
34,537 |
|
|
|
717,664 |
|
|
|
|
|
JCPenney |
|
2020 |
|
|
85,212 |
|
|
Macy's |
|
|
140,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plymouth Meeting Mall |
|
Plymouth Meeting, PA |
|
Boscov's |
|
2028 |
|
|
188,429 |
|
|
|
|
|
|
|
|
|
126,579 |
|
|
|
180,361 |
|
|
|
89,345 |
|
|
|
731,090 |
|
|
|
|
|
Whole Foods |
|
2029 |
|
|
65,155 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMC Theaters |
|
2027 |
|
|
|
|
|
|
|
|
|
|
|
|
48,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LEGOLAND Discovery Center |
|
2032 |
|
|
|
|
|
|
|
|
|
|
|
|
33,221 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Springfield Mall |
|
Springfield, PA |
|
|
|
|
|
|
|
|
|
Macy's |
|
|
192,000 |
|
|
|
20,577 |
|
|
|
179,945 |
|
|
|
22,197 |
|
|
|
610,618 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Target |
|
|
195,899 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27
|
||||||||||||||||||||||||||||||||
Property Information as of June 30, 2019 |
|
|||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Landlord Owned Anchors/ Large Format Non Anchor |
|
|
Anchor Stores Not Owned |
|
|
Non-anchor occupied GLA |
|
|
|
|
|
|
|
|
|
|||||||||||||
Properties |
|
Location |
|
Tenant |
|
Expiration Year |
|
GLA |
|
|
Tenant |
|
GLA |
|
|
Large Format |
|
|
Small Shop |
|
|
Vacant |
|
|
Total GLA |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Springfield, VA |
|
Macy's |
|
2025 |
|
|
252,245 |
|
|
JCPenney |
|
|
209,144 |
|
|
|
178,772 |
|
|
|
313,534 |
|
|
|
72,253 |
|
|
|
1,373,013 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Target |
|
|
180,841 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dick's Sporting Goods |
|
2025 |
|
|
|
|
|
|
|
|
|
|
|
|
53,891 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nordstrom Rack |
|
2025 |
|
|
|
|
|
|
|
|
|
|
|
|
33,107 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regal Cinemas |
|
2029 |
|
|
|
|
|
|
|
|
|
|
|
|
49,788 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Saks OFF 5th |
|
2026 |
|
|
|
|
|
|
|
|
|
|
|
|
29,438 |
|
|
|
|
|
|
|
|
|
|
|
|
|
The Mall at Prince Georges |
|
Hyattsville, MD |
|
JCPenney |
|
2021 |
|
|
148,778 |
|
|
|
|
|
|
|
|
|
177,988 |
|
|
|
250,364 |
|
|
|
11,913 |
|
|
|
919,884 |
|
|
|
|
|
Macy's |
|
2023 |
|
|
195,655 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Target |
|
2024 |
|
|
135,186 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Valley Mall |
|
Hagerstown, MD |
|
JCPenney |
|
2024 |
|
|
157,455 |
|
|
|
|
|
|
|
|
|
95,023 |
|
|
|
223,954 |
|
|
|
25,534 |
|
|
|
795,960 |
|
|
|
|
|
Belk |
|
2028 |
|
|
123,094 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regal Cinemas |
|
2028 |
|
|
|
|
|
|
|
|
|
|
|
|
53,059 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Onelife Fitness |
|
2033 |
|
|
70,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tilt Studio |
|
2028 |
|
|
47,841 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Viewmont Mall |
|
Scranton, PA |
|
JCPenney |
|
2025 |
|
|
193,112 |
|
|
Macy's |
|
|
139,801 |
|
|
|
65,843 |
|
|
|
156,819 |
|
|
|
21,074 |
|
|
|
689,226 |
|
|
|
|
|
Dick's Sporting Goods/Field & Stream |
|
2028 |
|
|
90,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HomeGoods |
|
2027 |
|
|
|
|
|
|
|
|
|
|
|
|
22,577 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Willow Grove Park |
|
Willow Grove, PA |
|
Macy's |
|
2022 |
|
|
225,000 |
|
|
Bloomingdale's |
|
|
237,537 |
|
|
|
78,219 |
|
|
|
242,582 |
|
|
|
37,258 |
|
|
|
1,036,512 |
|
|
|
|
|
Nordstrom Rack |
|
2022 |
|
|
40,332 |
|
|
Sears(1) |
|
|
175,584 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Woodland Mall |
|
Grand Rapids, MI |
|
|
|
|
|
|
|
|
|
JCPenney |
|
|
254,905 |
|
|
|
182,636 |
|
|
|
240,311 |
|
|
|
17,084 |
|
|
|
852,252 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Macy's |
|
|
157,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Core Malls |
|
|
|
|
|
|
|
|
4,492,683 |
|
|
|
|
|
3,385,924 |
|
|
|
2,809,709 |
|
|
|
3,795,184 |
|
|
|
747,283 |
|
|
|
15,230,783 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Malls and Retail Properties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Exton Square Mall |
|
Exton, PA |
|
Boscov's |
|
2024 |
|
|
178,000 |
|
|
Macy's |
|
|
181,200 |
|
|
|
41,884 |
|
|
|
198,840 |
|
|
|
188,896 |
|
|
|
991,492 |
|
|
|
|
|
Sears |
|
2019 |
|
|
144,301 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Round 1 |
|
2026 |
|
|
58,371 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gloucester Premium Outlets |
|
Blackwood, NJ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
37,303 |
|
|
|
274,579 |
|
|
|
56,266 |
|
|
|
368,148 |
|
Metroplex Shopping Center |
|
Plymouth Meeting, PA |
|
Giant Food Store |
|
2021 |
|
|
67,185 |
|
|
Lowe's |
|
|
163,215 |
|
|
|
287,711 |
|
|
|
49,012 |
|
|
|
7,280 |
|
|
|
778,190 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Target |
|
|
137,514 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dick's Sporting Goods |
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
41,593 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Saks OFF 5th |
|
2026 |
|
|
|
|
|
|
|
|
|
|
|
|
24,680 |
|
|
|
|
|
|
|
|
|
|
|
|
|
The Court at Oxford Valley |
|
Fairless Hills, PA |
|
Best Buy |
|
2021 |
|
|
59,620 |
|
|
BJ's Wholesale Club |
|
|
116,872 |
|
|
|
239,186 |
|
|
|
54,141 |
|
|
|
54,575 |
|
|
|
704,526 |
|
|
|
|
|
|
|
|
|
|
|
|
|
The Home Depot |
|
|
130,751 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dick's Sporting Goods |
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
49,381 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Valley View Mall |
(2) |
La Crosse, WI |
|
JCPenney |
|
2020 |
|
|
96,357 |
|
|
|
|
|
|
|
|
|
41,667 |
|
|
|
141,119 |
|
|
|
239,439 |
|
|
|
518,582 |
|
28
|
||||||||||||||||||||||||||||||||
Property Information as of June 30, 2019 |
|
|||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Landlord Owned Anchors/ Large Format Non Anchor |
|
|
Anchor Stores Not Owned |
|
|
Non-anchor occupied GLA |
|
|
|
|
|
|
|
|
|
|||||||||||||
Properties |
|
Location |
|
Tenant |
|
Expiration Year |
|
GLA |
|
|
Tenant |
|
GLA |
|
|
Large Format |
|
|
Small Shop |
|
|
Vacant |
|
|
Total GLA |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
La Crosse, WI |
|
Dick's Sporting Goods |
|
2025 |
|
|
|
|
|
|
|
|
|
|
|
|
45,000 |
|
|
|
22,267 |
|
|
|
- |
|
|
|
67,267 |
|
|
Red Rose Commons |
|
Lancaster, PA |
|
|
|
|
|
|
|
|
|
The Home Depot |
|
|
134,558 |
|
|
|
248,086 |
|
|
|
15,207 |
|
|
|
- |
|
|
|
462,883 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weis Market |
|
|
65,032 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wyoming Valley Mall |
(3) |
Wilkes-Barre, PA |
|
JCPenney |
|
2022 |
|
|
172,860 |
|
|
|
|
|
|
|
|
|
64,016 |
|
|
|
153,445 |
|
|
|
295,551 |
|
|
|
832,253 |
|
|
|
|
|
Macy's |
|
2022 |
|
|
146,381 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wyoming Valley Center |
|
Wilkes-Barre, PA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
78,229 |
|
|
|
- |
|
|
|
- |
|
|
|
78,229 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Other Malls and Retail Properties |
|
|
|
|
|
|
923,075 |
|
|
|
|
|
929,142 |
|
|
|
1,198,736 |
|
|
|
908,610 |
|
|
|
842,007 |
|
|
|
4,801,570 |
|
||
Total Portfolio |
|
|
|
|
|
|
|
|
5,415,758 |
|
|
|
|
|
4,315,066 |
|
|
|
4,008,445 |
|
|
|
4,703,794 |
|
|
|
1,589,290 |
|
|
|
20,032,353 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Approximately 69,000 square feet of this space has been subleased to Primark. |
|
|
|
|
|
|||||||||||||||||||||||||||
(2) Vacant GLA includes 100,000 square feet from former Herberger's store which closed in the third quarter of 2018. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(3) Vacant GLA includes 155,392 square feet from former Bon-Ton store and 117,477 from former Sears store, both of which closed in the third quarter of 2018. |
|
|
|
|
|
29
Pennsylvania Real Estate Investment Trust
Investment in Real Estate - Consolidated Properties
(in thousands)
|
|
June 30, 2019 |
|
|||||||||||||||||
|
|
Operating Properties and Land Held for Development |
|
|
Construction in Progress |
|
|
Accumulated Depreciation |
|
|
Net Real Estate |
|
|
Debt(2) |
|
|||||
Core Malls |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital City Mall |
|
$ |
135,352 |
|
|
$ |
2,664 |
|
|
$ |
49,474 |
|
|
$ |
88,542 |
|
|
$ |
- |
|
Cherry Hill Mall |
|
|
477,843 |
|
|
|
267 |
|
|
|
253,792 |
|
|
|
224,318 |
|
|
|
272,247 |
|
Cumberland Mall |
|
|
84,055 |
|
|
|
- |
|
|
|
29,952 |
|
|
|
54,103 |
|
|
|
43,037 |
|
Dartmouth Mall |
|
|
81,795 |
|
|
|
723 |
|
|
|
41,868 |
|
|
|
40,650 |
|
|
|
59,024 |
|
Francis Scott Key Mall |
|
|
98,316 |
|
|
|
- |
|
|
|
42,070 |
|
|
|
56,246 |
|
|
|
68,150 |
|
Jacksonville Mall |
|
|
94,343 |
|
|
|
- |
|
|
|
39,158 |
|
|
|
55,185 |
|
|
|
- |
|
Magnolia Mall |
|
|
107,250 |
|
|
|
2,081 |
|
|
|
48,010 |
|
|
|
61,321 |
|
|
|
- |
|
Moorestown Mall |
|
|
176,760 |
|
|
|
5,801 |
|
|
|
69,641 |
|
|
|
112,920 |
|
|
|
- |
|
Patrick Henry Mall |
|
|
156,257 |
|
|
|
- |
|
|
|
71,497 |
|
|
|
84,760 |
|
|
|
89,472 |
|
Plymouth Meeting Mall |
|
|
192,303 |
|
|
|
34,784 |
|
|
|
91,983 |
|
|
|
135,104 |
|
|
|
- |
|
The Mall at Prince Georges |
|
|
141,901 |
|
|
|
812 |
|
|
|
61,121 |
|
|
|
81,592 |
|
|
|
- |
|
Springfield Town Center |
|
|
494,477 |
|
|
|
- |
|
|
|
58,614 |
|
|
|
435,863 |
|
|
|
- |
|
Valley Mall |
|
|
130,035 |
|
|
|
11,396 |
|
|
|
47,373 |
|
|
|
94,058 |
|
|
|
- |
|
Viewmont Mall |
|
|
121,843 |
|
|
|
- |
|
|
|
47,781 |
|
|
|
74,062 |
|
|
|
66,961 |
|
Willow Grove Park |
|
|
227,556 |
|
|
|
24,847 |
|
|
|
102,160 |
|
|
|
150,243 |
|
|
|
157,782 |
|
Woodland Mall |
|
|
202,210 |
|
|
|
67,433 |
|
|
|
75,827 |
|
|
|
193,816 |
|
|
|
124,245 |
|
Total Core Malls |
|
|
2,922,296 |
|
|
|
150,808 |
|
|
|
1,130,321 |
|
|
|
1,942,783 |
|
|
|
880,918 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Core Malls |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exton Square Mall |
|
|
49,360 |
|
|
|
- |
|
|
|
11,154 |
|
|
|
38,206 |
|
|
|
- |
|
Valley View Mall |
|
|
38,342 |
|
|
|
- |
|
|
|
12,286 |
|
|
|
26,056 |
|
|
|
27,711 |
|
Wyoming Valley Mall |
|
|
59,399 |
|
|
|
- |
|
|
|
23,788 |
|
|
|
35,611 |
|
|
|
72,892 |
|
Total Non-Core Malls |
|
|
147,101 |
|
|
|
- |
|
|
|
47,228 |
|
|
|
99,873 |
|
|
|
100,603 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Malls |
|
$ |
3,069,397 |
|
|
$ |
150,808 |
|
|
$ |
1,177,549 |
|
|
$ |
2,042,656 |
|
|
$ |
981,521 |
|
Other Properties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land held for development |
|
|
5,881 |
|
|
|
- |
|
|
|
- |
|
|
|
5,881 |
|
|
|
- |
|
Total Other Properties |
|
$ |
5,881 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
5,881 |
|
|
$ |
- |
|
Total Investment in Real Estate |
|
$ |
3,075,278 |
|
|
$ |
150,808 |
|
|
$ |
1,177,549 |
|
|
$ |
2,048,537 |
|
|
$ |
981,521 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property held for sale |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Springhills(1) |
|
|
- |
|
|
|
9,577 |
|
|
|
- |
|
|
|
9,577 |
|
|
|
- |
|
Total held for sale |
|
$ |
- |
|
|
$ |
9,577 |
|
|
$ |
- |
|
|
$ |
9,577 |
|
|
$ |
- |
|
|
(1) |
Springhills, a former development property located in Gainesville, Florida, was classified as construction in progress as of December 31, 2017 and as an asset held for sale as of June 30, 2019. |
|
(2) |
Refer to page 37 for further debt information. |
30
Pennsylvania Real Estate Investment Trust
Investment in Real Estate - Equity Method Investments at Ownership Share
(in thousands)
|
|
June 30, 2019 |
|
|||||||||||||||||
|
|
Operating Properties and Land Held for Development |
|
|
Construction in Progress |
|
|
Accumulated Depreciation |
|
|
Net Real Estate |
|
|
Debt(2) |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unconsolidated Malls |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fashion District Philadelphia(1) |
|
$ |
48,233 |
|
|
$ |
229,089 |
|
|
$ |
7,984 |
|
|
$ |
269,338 |
|
|
$ |
- |
|
Lehigh Valley Mall |
|
|
49,632 |
|
|
|
1,215 |
|
|
|
28,055 |
|
|
|
22,792 |
|
|
|
96,890 |
|
Springfield Mall |
|
|
58,576 |
|
|
|
60 |
|
|
|
23,228 |
|
|
|
35,408 |
|
|
|
30,380 |
|
Total Unconsolidated Malls |
|
$ |
156,441 |
|
|
$ |
230,364 |
|
|
$ |
59,267 |
|
|
$ |
327,538 |
|
|
$ |
127,270 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unconsolidated Other Retail Properties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gloucester Premium Outlets |
|
|
27,360 |
|
|
|
494 |
|
|
|
4,230 |
|
|
|
23,624 |
|
|
|
21,351 |
|
Metroplex Shopping Center |
|
|
42,995 |
|
|
|
26 |
|
|
|
25,711 |
|
|
|
17,310 |
|
|
|
37,826 |
|
The Court at Oxford Valley |
|
|
29,087 |
|
|
|
- |
|
|
|
13,077 |
|
|
|
16,010 |
|
|
|
26,877 |
|
Red Rose Commons |
|
|
14,216 |
|
|
|
- |
|
|
|
4,136 |
|
|
|
10,080 |
|
|
|
12,965 |
|
Total Unconsolidated Other Retail Properties |
|
$ |
113,658 |
|
|
$ |
520 |
|
|
$ |
47,154 |
|
|
$ |
67,024 |
|
|
$ |
99,019 |
|
Unconsolidated Property Under Development |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pavilion at Market East |
|
|
6,346 |
|
|
|
784 |
|
|
|
2,384 |
|
|
|
4,746 |
|
|
|
3,140 |
|
Total Investment in Real Estate |
|
$ |
276,445 |
|
|
$ |
231,668 |
|
|
$ |
108,805 |
|
|
$ |
399,308 |
|
|
$ |
229,429 |
|
(1)CIP includes $41.0 million of existing building shell that was reclassified from operating properties.
(2) Refer to page 37 for further debt information.
31
Pennsylvania Real Estate Investment Trust
Anchor Replacement Summary
June 30, 2019
Property |
Former Anchors |
GLA (in '000's) |
Date Closed |
|
Decommission Date |
Replacement Tenant(s) |
GLA (in '000's) |
Actual/Targeted Occupancy Date |
Completed: |
||||||||
|
|
|
|
|
|
|
|
|
Magnolia Mall |
Sears |
91 |
Q1 17 |
|
Q2 17 |
Burlington |
46 |
Q3 17 |
|
|
|
|
|
|
HomeGoods |
22 |
Q2 18 |
|
|
|
|
|
|
Five Below |
8 |
Q2 18 |
Moorestown Mall |
Macy's |
200 |
Q1 17 |
|
Q2 17 |
HomeSense |
28 |
Q3 18 |
|
|
|
|
|
|
Five Below |
9 |
Q4 18 |
|
|
|
|
|
|
Sierra Trading Post |
19 |
Q1 19 |
Valley Mall |
Macy's |
120 |
Q1 16 |
|
Q4 17 |
Tilt Studio |
48 |
Q3 18 |
|
|
|
|
|
|
One Life Fitness |
70 |
Q3 18 |
|
Bon-Ton |
123 |
Q1 18 |
|
Q1 18 |
Belk |
123 |
Q4 18 |
Woodland Mall |
Sears |
313 |
Q2 17 |
|
Q2 17 |
REI |
20 |
Q2 19 |
|
|
|
|
|
|
|
|
|
In progress: |
||||||||
Plymouth Meeting Mall |
Macy's(1) |
215 |
Q1 17 |
|
Q2 17 |
Burlington |
41 |
Q4 19 |
|
|
|
|
|
|
Dick's Sporting Goods |
58 |
Q4 19 |
|
|
|
|
|
|
Edge Fitness |
38 |
Q4 19 |
|
|
|
|
|
|
Michael's |
26 |
Q1 20 |
|
|
|
|
|
|
Miller's Ale House |
7 |
Q4 19 |
Valley Mall |
Sears |
123 |
Q3 17 |
|
Q2 18 |
Dick's Sporting Goods |
57 |
Q1 20 |
Moorestown Mall |
Macy's |
see above |
Michael's |
25 |
Q1 20 |
|||
Woodland Mall |
Sears |
see above |
Von Maur |
87 |
Q4 19 |
|||
|
|
|
|
|
|
Urban Outfitters |
8 |
Q4 19 |
|
|
|
|
|
|
Black Rock Bar & Grill |
9 |
Q3 19 |
|
|
|
|
|
|
Restaurants and small shops |
13 |
Q4 19 |
Willow Grove Park |
JC Penney |
125 |
Q3 17 |
|
Q1 18 |
Studio Movie Grill |
51 |
Q1 20 |
|
|
|
|
|
|
Yard House |
8 |
Q4 19 |
|
|
|
|
|
|
Restaurant and entertainment space |
36 |
Q4 19 |
Dartmouth Mall |
Sears |
108 |
Q3 19 |
|
Q3 19 |
Burlington |
44 |
Q2 20 |
(1)Property is subject to a ground lease.
32
Pennsylvania Real Estate Investment Trust
Property Redevelopment Table as of June 30, 2019
Name of Project and Location |
|
PREIT's Projected Share of Cost (1) (in millions) |
|
Total Project Cost (1) (in millions) |
|
PREIT's Investment to Date (in millions) |
|
|
Targeted Return on Incremental Investment |
|
Construction Start Date |
|
Expected Construction Completion |
|
Stabilization Year |
|
Percentage Leased or Negotiating |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fashion District Philadelphia |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Philadelphia, PA |
|
$200-210 |
|
$400-420 |
|
$ |
163.4 |
|
|
7-7.5% |
|
2016 |
|
2019 |
|
2021 |
|
90% |
|
|
Redevelopment of The Gallery in downtown Philadelphia; includes Burlington, Century 21, H&M, AMC Theatres, Round One, and City Winery and other retail, entertainment, and restaurant uses. Total project costs are net of $25.0 million of approved public financing grants that will be a reduction of costs and excludes GAAP allocations of non-cash and indirect costs. |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Woodland Mall |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Grand Rapids, MI |
|
$89-90 |
|
$89-90 |
|
$ |
69.7 |
|
|
5.0-6.0% |
|
2017 |
|
2019 |
|
2021 |
|
89% |
|
|
Upgrade of existing tenant mix including: 90,000 square foot Von Maur, new-to-market tenants: Urban Outfitters, and Black Rock Bar & Grill along with additional high quality dining & retail, replacing a former Sears store. REI opened May 2019. |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anchor replacements: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Moorestown Mall |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Moorestown, NJ |
|
$28-29 |
|
$28-29 |
|
$ |
23.9 |
|
|
6.5-7.0% |
|
2018 |
|
2019 |
|
2020 |
|
81% |
|
|
HomeSense, Five Below, and Sierra Trading Post opened in former Macy's box and will be joined by Michael's in 2020. |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plymouth Meeting Mall |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plymouth Meeting, PA |
|
$45-46 |
|
$45-46 |
|
$ |
28.6 |
|
|
6.5-7.5% |
|
2017 |
|
2019 |
|
2020 |
|
93% |
|
|
Addition of 5 new and distinct uses in former Macy's box as the evolution of property continues - DICK's Sporting Goods, Burlington, Edge Fitness, Michael's and Miller's Ale House. |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Willow Grove Park Mall |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Willow Grove, PA |
|
$27-28 |
|
$27-28 |
|
$ |
24.9 |
|
|
7.5-8.0% |
|
2018 |
|
2020 |
|
2021 |
|
82% |
|
|
Addition of Studio Movie Grill, offering movies and in-theater dining, with other dining and entertainment tenants planned in former JC Penney box. |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dartmouth Mall |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dartmouth, MA |
|
$9-10 |
|
$9-10 |
|
$ |
3.1 |
|
|
6.0-8.0% |
|
2019 |
|
2020 |
|
2021 |
|
49% |
|
|
Includes Burlington as lead replacement for Sears as well as several outparcel opportunities. |
|
(1) PREIT's projected share of costs is net of any expected tenant reimbursements, parcel sales, tax credits or other incentives.
33
Pennsylvania Real Estate Investment Trust
Capital Expenditures
Three and Six Months Ended June 30, 2019
(in thousands)
|
|
Three Months Ended June 30, 2019 |
|
|
Six Months Ended June 30, 2019 |
|
||||||||||||||||||
|
|
Consolidated |
|
|
PREIT's Share of Equity Method Investments |
|
|
Total |
|
|
Consolidated |
|
|
PREIT's Share of Equity Method Investments |
|
|
Total |
|
||||||
Redevelopment projects with incremental GLA and/or anchor replacement (1) |
|
$ |
35,483 |
|
|
$ |
10,110 |
|
|
$ |
45,593 |
|
|
$ |
46,468 |
|
|
$ |
21,377 |
|
|
$ |
67,845 |
|
Tenant allowances |
|
|
1,289 |
|
|
|
110 |
|
|
|
1,399 |
|
|
|
3,237 |
|
|
|
232 |
|
|
|
3,469 |
|
Recurring capital expenditures: |
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
- |
|
CAM expenditures |
|
|
4,266 |
|
|
|
233 |
|
|
|
4,499 |
|
|
|
5,835 |
|
|
|
277 |
|
|
|
6,112 |
|
Non-CAM expenditures |
|
|
566 |
|
|
|
24 |
|
|
|
590 |
|
|
|
963 |
|
|
|
28 |
|
|
|
991 |
|
Total recurring capital expenditures |
|
|
4,832 |
|
|
|
257 |
|
|
|
5,089 |
|
|
|
6,798 |
|
|
|
305 |
|
|
|
7,103 |
|
Total |
|
$ |
41,604 |
|
|
$ |
10,477 |
|
|
$ |
52,081 |
|
|
$ |
56,503 |
|
|
$ |
21,914 |
|
|
$ |
78,417 |
|
|
(1) |
Net of any tenant reimbursements, parcel sales, tax credits or other incentives. |
34
Pennsylvania Real Estate Investment Trust
Debt Analysis as of June 30, 2019
(in thousands)
|
|
Outstanding Debt |
|
|||||||||||||||||||||
|
|
Fixed Rate (1) |
|
|
% of Total Indebtedness |
|
|
Variable Rate |
|
|
% of Total Indebtedness |
|
|
Total |
|
|
% of Total Indebtedness |
|
||||||
Consolidated mortgage loans payable (2) |
|
$ |
970,136 |
|
|
|
46.8 |
% |
|
$ |
13,854 |
|
|
|
0.7 |
% |
|
$ |
983,990 |
|
|
|
47.5 |
% |
Unconsolidated mortgage loans payable (3) |
|
|
205,604 |
|
|
|
9.9 |
% |
|
|
24,659 |
|
|
|
1.2 |
% |
|
|
230,263 |
|
|
|
11.1 |
% |
Consolidated Term Loans (4) |
|
|
550,000 |
|
|
|
26.6 |
% |
|
|
- |
|
|
|
0.0 |
% |
|
|
550,000 |
|
|
|
26.8 |
% |
Unconsolidated Term Loan (5) |
|
|
- |
|
|
|
0.0 |
% |
|
|
125,000 |
|
|
|
6.0 |
% |
|
|
125,000 |
|
|
|
6.1 |
% |
2018 Revolving Facility |
|
|
- |
|
|
|
0.0 |
% |
|
|
182,000 |
|
|
|
8.8 |
% |
|
|
182,000 |
|
|
|
7.9 |
% |
Total Outstanding Debt |
|
$ |
1,725,740 |
|
|
|
83.3 |
% |
|
$ |
345,513 |
|
|
|
16.7 |
% |
|
$ |
2,071,253 |
|
|
|
100.0 |
% |
Average Stated Interest Rate |
|
|
4.04 |
% |
|
|
|
|
|
|
4.06 |
% |
|
|
|
|
|
|
4.05 |
% |
|
|
|
|
|
(1) |
Includes variable rate debt swapped to fixed rate debt. |
|
(2) |
Excludes deferred financing costs of $2,470. |
|
(3) |
Reflects our share of mortgage debt of equity method investees. Excludes our share of deferred financing costs of $834. |
|
(4) |
Excludes deferred financing costs of $2,357. |
|
(5) |
Reflects our share of Term Loan debt of equity method investee. Excludes our share of deferred financing costs of $920. |
|
|
|
|
Average Debt Balance |
|
|||||||||||||
|
|
|
|
Mortgage Debt |
|
|
Revolving Facility |
|
|
Term Loans |
|
|
Total |
|
||||
Beginning Balance |
|
3/31/2019 |
|
$ |
1,219,765 |
|
|
$ |
162,000 |
|
|
$ |
675,000 |
|
|
$ |
2,056,765 |
|
2018 Revolving Facility Repayment |
|
4/4/2019 |
|
|
- |
|
|
|
(8,000 |
) |
|
|
- |
|
|
|
(8,000 |
) |
2018 Revolving Facility Repayment |
|
4/30/2019 |
|
|
- |
|
|
|
(15,000 |
) |
|
|
- |
|
|
|
(15,000 |
) |
2018 Revolving Facility Borrowing |
|
5/22/2019 |
|
|
|
|
|
|
5,000 |
|
|
|
|
|
|
|
5,000 |
|
2018 Revolving Facility Borrowing |
|
5/28/2019 |
|
|
|
|
|
|
10,000 |
|
|
|
|
|
|
|
10,000 |
|
2018 Revolving Facility Borrowing |
|
6/14/2019 |
|
|
|
|
|
|
10,000 |
|
|
|
|
|
|
|
10,000 |
|
2018 Revolving Facility Borrowing |
|
6/24/2019 |
|
|
|
|
|
|
18,000 |
|
|
|
|
|
|
|
18,000 |
|
Mortgage loan amortization, including our share of debt of equity method investees |
|
|
|
|
(5,512 |
) |
|
|
- |
|
|
|
- |
|
|
|
(5,512 |
) |
Ending Balance |
|
6/30/2019 |
|
$ |
1,214,253 |
|
|
$ |
182,000 |
|
|
$ |
675,000 |
|
|
$ |
2,071,253 |
|
Weighted Average Balance |
|
|
|
$ |
1,217,912 |
|
|
$ |
153,011 |
|
|
$ |
675,000 |
|
|
$ |
2,045,923 |
|
(continued on next page)
35
Pennsylvania Real Estate Investment Trust
Debt Analysis as of June 30, 2019
(in thousands)
Debt Maturities(1) |
|
|||||||||||||||||||||||||||
Year |
|
Scheduled Amortization |
|
|
Deferred Financing Cost Amortization - Mortgages |
|
|
Mortgage Balance at Initial Maturity Date |
|
|
2018 Revolving Facility |
|
|
Term Loans |
|
|
Deferred Financing Cost Amortization - Term Loans |
|
|
Total Debt |
|
|||||||
2019 |
|
$ |
11,233 |
|
|
$ |
(541 |
) |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
(530 |
) |
|
$ |
10,162 |
|
2020 |
|
|
22,831 |
|
|
|
(1,066 |
) |
|
|
27,161 |
|
|
|
- |
|
|
|
- |
|
|
|
(1,013 |
) |
|
|
47,913 |
|
2021 |
|
|
23,338 |
|
|
|
(683 |
) |
|
|
229,955 |
|
|
|
- |
|
|
|
250,000 |
|
|
|
(987 |
) |
|
|
501,623 |
|
2022 |
|
|
18,705 |
|
|
|
(358 |
) |
|
|
377,489 |
|
|
|
- |
|
|
|
- |
|
|
|
(596 |
) |
|
|
395,240 |
|
2023 |
|
|
11,650 |
|
|
|
(247 |
) |
|
|
153,548 |
|
|
|
182,000 |
|
|
|
425,000 |
|
|
|
(151 |
) |
|
|
771,800 |
|
Thereafter |
|
|
20,910 |
|
|
|
(409 |
) |
|
|
317,433 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
337,934 |
|
|
|
$ |
108,667 |
|
|
$ |
(3,304 |
) |
|
$ |
1,105,586 |
|
|
$ |
182,000 |
|
|
$ |
675,000 |
|
|
$ |
(3,277 |
) |
|
$ |
2,064,672 |
|
|
(1) |
The weighted average period to total debt maturity is 3.67 years, excluding extension options. Includes 100% of revolver, term loan and mortgage loan debt from consolidated properties and our share of term loan and mortgage loan debt of equity method investees. |
Weighted Average Mortgage Interest Rates |
|
|||||||
Year |
|
Balance (1) |
|
|
Interest Rate |
|
||
2019 |
|
$ |
- |
|
|
|
0.00 |
% |
2020 |
|
|
27,787 |
|
|
|
5.95 |
% |
2021 |
|
|
234,951 |
|
|
|
3.66 |
% |
2022 |
|
|
405,595 |
|
|
|
4.14 |
% |
2023 |
|
|
170,120 |
|
|
|
4.72 |
% |
Thereafter |
|
|
375,800 |
|
|
|
4.08 |
% |
Total |
|
$ |
1,214,253 |
|
|
|
4.15 |
% |
|
(1) |
Includes our share of debt of equity method investees |
36
Pennsylvania Real Estate Investment Trust
Debt Schedule as of June 30, 2019
(in thousands)
|
|
Debt |
|
|
Interest Rate |
|
|
Annual Debt Service |
|
|
Balance at Maturity |
|
|
Initial Maturity Date |
|
Fully Extended Maturity Date |
||||
Fixed Rate Mortgage Loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Valley View Mall |
|
$ |
27,787 |
|
|
|
5.95 |
% |
|
$ |
2,290 |
|
|
$ |
27,161 |
|
|
July 2020 |
|
July 2020 |
Viewmont Mall (1) |
|
|
57,000 |
|
|
|
3.73 |
% |
|
|
2,126 |
|
|
|
57,000 |
|
|
March 2021 |
|
March 2021 |
Woodland Mall (1) |
|
|
124,680 |
|
|
|
3.02 |
% |
|
|
5,452 |
|
|
|
121,600 |
|
|
April 2021 |
|
April 2021 |
Red Rose Commons (2) |
|
|
13,009 |
|
|
|
5.14 |
% |
|
978 |
|
|
|
12,379 |
|
|
July 2021 |
|
July 2021 |
|
The Court at Oxford Valley (2) |
|
|
26,918 |
|
|
|
5.56 |
% |
|
|
2,058 |
|
|
|
25,782 |
|
|
July 2021 |
|
July 2021 |
Cumberland Mall |
|
|
43,131 |
|
|
|
4.40 |
% |
|
|
3,433 |
|
|
|
38,157 |
|
|
August 2022 |
|
August 2022 |
Cherry Hill Mall |
|
|
272,495 |
|
|
|
3.90 |
% |
|
|
16,980 |
|
|
|
251,120 |
|
|
September 2022 |
|
September 2022 |
Francis Scott Key Mall (1) |
|
|
64,800 |
|
|
|
5.01 |
% |
|
|
3,244 |
|
|
|
63,137 |
|
|
January 2022 |
|
January 2023 |
Dartmouth Mall |
|
|
59,132 |
|
|
|
3.97 |
% |
|
|
3,825 |
|
|
|
53,300 |
|
|
April 2023 |
|
April 2023 |
Metroplex Shopping Center (2) |
|
|
37,871 |
|
|
|
5.00 |
% |
|
|
2,818 |
|
|
|
33,502 |
|
|
October 2023 |
|
October 2023 |
Wyoming Valley Mall |
|
|
73,117 |
|
|
|
5.17 |
% |
|
|
5,123 |
|
|
|
66,746 |
|
|
December 2023 |
|
December 2023 |
Patrick Henry Mall |
|
|
89,805 |
|
|
|
4.35 |
% |
|
|
5,748 |
|
|
|
77,592 |
|
|
July 2025 |
|
July 2025 |
Springfield Mall (2) |
|
|
30,520 |
|
|
|
4.45 |
% |
|
|
1,964 |
|
|
|
26,298 |
|
|
October 2025 |
|
October 2025 |
Willow Grove Park |
|
|
158,189 |
|
|
|
3.88 |
% |
|
|
9,599 |
|
|
|
133,754 |
|
|
October 2025 |
|
October 2025 |
Lehigh Valley Mall (2) |
|
|
97,286 |
|
|
|
4.06 |
% |
|
|
5,768 |
|
|
|
79,789 |
|
|
November 2027 |
|
November 2027 |
Total Fixed Rate Mortgage Loans |
|
$ |
1,175,740 |
|
|
|
4.15 |
% |
|
$ |
71,406 |
|
|
$ |
1,067,317 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable Rate Mortgage Loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pavilion East Associates (2) |
|
$ |
3,159 |
|
|
|
5.29 |
% |
|
$ |
270 |
|
|
$ |
3,009 |
|
|
February 2021 |
|
February 2021 |
Viewmont Mall |
|
|
10,185 |
|
|
|
4.79 |
% |
|
493 |
|
|
|
10,185 |
|
|
March 2021 |
|
March 2021 |
|
Gloucester Premium Outlets (2) |
|
|
21,500 |
|
|
|
3.94 |
% |
|
858 |
|
|
|
21,500 |
|
|
March 2022 |
|
March 2023 |
|
Francis Scott Key Mall |
|
|
3,669 |
|
|
|
5.04 |
% |
|
187 |
|
|
|
3,575 |
|
|
January 2022 |
|
January 2023 |
|
Total Variable Rate Mortgage Loans |
|
$ |
38,513 |
|
|
|
4.38 |
% |
|
$ |
1,808 |
|
|
$ |
38,269 |
|
|
|
|
|
Total Mortgage Loans |
|
$ |
1,214,253 |
|
|
|
4.16 |
% |
|
$ |
73,214 |
|
|
$ |
1,105,586 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Mortgage Loans |
|
$ |
983,990 |
|
|
|
4.08 |
% |
|
$ |
58,500 |
|
|
$ |
903,327 |
|
|
|
|
|
Consolidated deferred financing fees |
|
|
(2,470 |
) |
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
|
|
|
|||
Unconsolidated Mortgage Loans |
|
|
230,263 |
|
|
|
4.51 |
% |
|
|
14,714 |
|
|
|
202,259 |
|
|
|
|
|
Unconsolidated Deferred Financing Fees |
|
|
(834 |
) |
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
|
|
|
|||
2014 7 Year Term Loan (swapped to fixed) |
|
|
250,000 |
|
|
|
3.42 |
% |
|
|
8,375 |
|
|
|
250,000 |
|
|
December 2021 |
|
December 2021 |
2018 5 Year Term Loan (swapped to fixed) |
|
|
300,000 |
|
|
|
3.79 |
% |
|
|
11,370 |
|
|
|
300,000 |
|
|
May 2023 |
|
May 2023 |
Unconsolidated Term Loan (variable) |
|
|
125,000 |
|
|
|
4.49 |
% |
|
|
5,613 |
|
|
|
125,000 |
|
|
January 2023 |
|
January 2023 |
Term Loan Deferred Financing Fees |
|
|
(3,277 |
) |
|
n/a |
|
|
n/a |
|
|
n/a |
|
|
|
|
|
|||
2018 Revolving Facility |
|
|
182,000 |
|
|
|
3.70 |
% |
|
|
6,140 |
|
|
|
182,000 |
|
|
May 2022 |
|
May 2023 |
Total |
|
$ |
2,064,672 |
|
|
|
4.05 |
% |
|
$ |
104,712 |
|
|
$ |
1,962,586 |
|
|
|
|
|
Amortization of Deferred Financing Fees |
|
— |
|
|
|
0.16 |
% |
|
— |
|
|
— |
|
|
|
|
|
|||
Effective Interest Rate |
|
$ |
2,064,672 |
|
|
|
4.21 |
% |
|
$ |
104,712 |
|
|
$ |
1,962,586 |
|
|
|
|
|
|
(1) |
All or a portion of the loan has been effectively swapped to the fixed interest rate presented. |
|
(2) |
Includes our share of debt of equity method investees, based on our ownership percentage. |
37
Pennsylvania Real Estate Investment Trust
Selected Debt Ratios (1)
|
June 30, 2019 |
|
|
Consolidated Liabilities to Gross Asset Value |
|
56.12 |
% |
Ratio of Consolidated Liabilities to Gross Asset Value shall not exceed 60% |
|
|
|
Secured Indebtedness to Gross Asset Value |
|
34.96 |
% |
Secured indebtedness to Gross Asset Value may not exceed 60% |
|
|
|
Adjusted EBITDA to Fixed Charges |
1.66 |
|
|
Adjusted EBITDA may not be less than 1.50 to 1.00 |
|
|
|
Unencumbered Adjusted NOI to Unsecured Interest Expense |
3.69 |
|
|
Unencumbered Adjusted NOI to Unsecured Interest Expense may not be less than 1.75 to 1.00 |
|
|
|
Unencumbered Debt Yield |
|
12.86 |
% |
The ratio of Unencumbered Adjusted NOI to Unsecured Debt may not be less than 11% |
|
|
|
(1) |
The 2018 Revolving Facility Agreement and 2018 Term Loan Agreement dated May 24, 2018, and the 7-Year 2014 Term Loan Agreement, as amended, dated June 5, 2018 (collectively, the "Credit Facility Agreements"), contain identical affirmative and negative covenants customarily found in such agreements, including requirements that the Company, on a consolidated basis, maintain certain financial ratios. All capitalized terms used on this page have the meanings ascribed to such terms in the Credit Facility Agreements. In addition to the ratios set forth herein, there are several other ratios set forth in the covenants under the Credit Facility Agreements with which the Company must comply, which are described in the Company’s quarterly report on form 10-Q for the quarterly period ended June 30, 2018. |
38
Pennsylvania Real Estate Investment Trust
Forward Looking Statements
This Quarterly Supplemental and Operating Information contains certain forward-looking statements that can be identified by the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “project,” “intend,” “may” or similar expressions. Forward-looking statements relate to expectations, beliefs, projections, future plans, strategies, anticipated events, trends and other matters that are not historical facts. These forward-looking statements reflect our current views about future events, achievements or results and are subject to risks, uncertainties and changes in circumstances that might cause future events, achievements or results to differ materially from those expressed or implied by the forward-looking statements. In particular, our business might be materially and adversely affected by the following:
|
• |
changes in the retail and real estate industries, including consolidation and store closings, particularly among anchor tenants; |
|
• |
current economic conditions and the corresponding effects on tenant business performance, prospects, solvency and leasing decisions; |
|
• |
our inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise; |
|
• |
our ability to maintain and increase property occupancy, sales and rental rates; |
|
• |
increases in operating costs that cannot be passed on to tenants; |
|
• |
the effects of online shopping and other uses of technology on our retail tenants; |
|
• |
risks related to our development and redevelopment activities, including delays, cost overruns and our inability to reach projected occupancy or rental rates; |
|
• |
acts of violence at malls, including our properties, or at other similar spaces, and the potential effect on traffic and sales; |
|
• |
our ability to sell properties that we seek to dispose of or our ability to obtain prices we seek; |
|
• |
our substantial debt and the liquidation preference of our preferred shares and our high leverage ratio; |
|
• |
our ability to refinance our existing indebtedness when it matures, on favorable terms or at all; |
|
• |
our ability to raise capital, including through sales of properties or interests in properties and through the issuance of equity or equity-related securities if market conditions are favorable; and |
|
• |
potential dilution from any capital raising transactions or other equity issuances. |
Additional factors that might cause future events, achievements or results to differ materially from those expressed or implied by our forward-looking statements include those discussed herein and in our Annual Report on Form 10-K for the year ended December 31, 2018 in the section entitled “Item 1A. Risk Factors.” We do not intend to update or revise any forward-looking statements to reflect new information, future events or otherwise.
39
Pennsylvania Real Estate Investment Trust
Funds From Operations (FFO)
The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO, which is a non-GAAP measure commonly used by REITs, as net income (computed in accordance with GAAP) excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, and (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. We compute FFO in accordance with standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do. NAREIT’s established guidance provides that excluding impairment write downs of depreciable real estate is consistent with the NAREIT definition.
FFO is a commonly used measure of operating performance and profitability among REITs. We use FFO and FFO per diluted share and unit of limited partnership interest in our operating partnership (“OP Unit”) and, when applicable, related measures such as Funds From Operations, as adjusted, in measuring our performance against our peers and as one of the performance measures for determining incentive compensation amounts earned under certain of our performance-based executive compensation programs.
FFO does not include gains and losses on sales of operating real estate assets or impairment write downs of depreciable real estate, which are included in the determination of net income in accordance with GAAP. Accordingly, FFO is not a comprehensive measure of our operating cash flows. In addition, since FFO does not include depreciation on real estate assets, FFO may not be a useful performance measure when comparing our operating performance to that of other non-real estate commercial enterprises. We compensate for these limitations by using FFO in conjunction with other GAAP financial performance measures, such as net income and net cash provided by operating activities, and other non-GAAP financial performance measures, such as NOI. FFO does not represent cash generated from operating activities in accordance with GAAP and should not be considered to be an alternative to net income (determined in accordance with GAAP) as an indication of our financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available for our cash needs, including our ability to make cash distributions. We believe that net income is the most directly comparable GAAP measurement to FFO.
When applicable, we also present Funds From Operations, as adjusted, and Funds From Operations per diluted share and OP Unit, as adjusted, which are non-GAAP measures, to show the effect of such items as loss on debt extinguishment, accelerated amortization of financing costs, impairment of assets, provision for employee separation expense and insurance losses, net, which can have a significant effect on our results of operations, but are not, in our opinion, indicative of our operating performance. We also present FFO on a further adjusted basis to isolate the impact on FFO caused by property dispositions.
We believe that FFO is helpful to management and investors as a measure of operating performance because it excludes various items included in net income that do not relate to or are not indicative of operating performance, such as gains on sales of operating real estate and depreciation and amortization of real estate, among others. We believe that Funds From Operations, as adjusted, is helpful to management and investors as a measure of operating performance because it adjusts FFO to exclude items that management does not believe are indicative of our operating performance, such as provision for employee separation expense and accelerated amortization of financing costs.
Net Operating Income (NOI)
NOI (a non-GAAP measure) is derived from real estate revenue (determined in accordance with GAAP, including lease termination revenue), minus property operating expenses (determined in accordance with GAAP), plus our pro rata share of revenue and property operating expenses of our unconsolidated partnership investments. NOI excludes other income, general and administrative expenses, employee separation expenses, interest expense, depreciation and amortization, impairment of assets, gains/ adjustment to gains on sale of interest in non operating real estate, gain on sale of interest in real estate by equity method investee, gains/ losses on sales of interests in real estate, net, and project costs and other expenses. We believe that net income is the most directly comparable GAAP measure to NOI.
NOI excludes other income, general and administrative expenses, interest expense, depreciation and amortization, adjustment to gains on sale of interest in non operating real estate, gain on sale of interest in real estate by equity method investee, losses on sales of interest in real estate, impairment of assets, project costs and other expenses.
We believe that NOI is helpful to management and investors as a measure of operating performance because it is an indicator of the return on property investment and provides a method of comparing property performance over time. We use NOI and related terms, like Same Store NOI, as performance measures for determining incentive compensation amounts under certain of our performance-based incentive compensation programs.
Same Store NOI
Same Store NOI is calculated using retail properties owned for the full periods presented and excludes properties acquired, disposed, under redevelopment or designated as non-core during the periods presented. In 2018, Wyoming Valley Mall was designated as non-core. In 2019, Exton Square and Valley View Malls were designated as non-core and will be excluded from Same Store NOI. Non Same Store NOI is calculated using the retail properties excluded from the calculation of Same Store NOI.
Funds Available for Distribution (FAD)
FAD is a measure of a real estate company’s cash flows generated by operations and capacity to pay dividends. The Company calculates FAD by starting with FFO as adjusted and subtracting (1) straight-line rent, (2) normalized recurring capital expenditures that are capitalized but necessary to maintain our properties, (3) operational tenant allowances, (4) capitalized leasing costs, (5) non-cash compensation charges, and (6) amortization of above- and below-market lease intangibles.
We believe that net income is the most directly comparable GAAP measurement to FAD. We believe FAD provides a meaningful indicator of our ability to fund cash needs and to make cash distributions to equity owners. In addition, we believe that to further understand our liquidity, FAD should be compared with our cash flow from operating activities determined in accordance with GAAP, as presented in our consolidated financial statements. The computation of FAD may not be comparable to FAD reported by other REITs or real estate companies and FAD does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of our performance, or as an alternative to net cash flow from operating activities (determined in accordance with GAAP), as a measure of our liquidity.
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre)
NAREIT defines Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”), which is a non-GAAP measure, as net income (computed in accordance with GAAP) plus interest expense, income tax expense, depreciation and amortization; plus or minus losses and gains on the disposition of depreciated property, including losses/ gains on change in control; plus impairment write downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in value of depreciated property in the affiliate; plus or minus adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates. We compute EBITDAre in accordance with the standards established by NAREIT, which may not be comparable to EBITDAre reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do.
EBITDAre does not include interest expense, income tax expense, gains or losses on sales of operating real estate or impairment writedowns of depreciable real estate, which are included in the determination of net income in accordance with GAAP. Accordingly, EBITDAre is not a comprehensive measure of our operating cash flows. EBITDAre does not represent cash generated from operating activities in accordance with GAAP and should not be considered to be an alternative to net income (determined in accordance with GAAP) as an indication of our financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available for our cash needs, including our ability to make cash distributions. We believe that net income is the most directly comparable GAAP measurement to EBITDAre.
We believe that EBITDAre is helpful to management and investors as a measure of operating performance because it provides an additional performance measure to management and investors to facilitate the evaluation and comparison of the Company to other REITs and to other non-real estate commercial enterprises.
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