EX-99.2 3 a07-20898_1ex99d2.htm EX-99.2

Exhibit 99.2

HRPT PROPERTIES TRUST

Second Quarter 2007

Supplemental Operating and Financial Data

All amounts in this report are unaudited, except for the
December 31, 2006 Consolidated Balance Sheet.




TABLE OF CONTENTS

Page

 

 

 

 

CORPORATE INFORMATION

 

 

 

Company Profile

5

Investor Information

6

Research Coverage

7

 

 

FINANCIAL INFORMATION

 

 

 

Key Financial Data

9

Consolidated Balance Sheets

10

Consolidated Statements of Income

11

Consolidated Statements of Cash Flows

12

Calculation of EBITDA

13

Calculation and Reconciliation of Property Net Operating Income (NOI)

14

Calculation of Funds from Operations (FFO)

15

Calculation of Diluted Net Income, FFO and Weighted Average Common Shares Outstanding

16

Summary Results of Operations by Property Type

17

Summary Results of Operations by Major Market

18

Same Property Results and Analysis by Property Type

19

Same Property Results and Analysis by Major Market

20

Debt Summary

21

Debt Maturity Schedule

22

Leverage Ratios, Coverage Ratios and Public Debt Covenants

23

Tenant Improvements, Leasing Costs and Capital Improvements

24

2007 Acquisitions and Dispositions Information

25

2007 Financing Activities

26

 

 

PORTFOLIO AND LEASING INFORMATION

 

 

 

Portfolio Summary by Property Type, Tenant and Major Market (Square Feet)

28

Portfolio Summary by Property Type, Tenant and Major Market (Annualized Rental Income)

29

Summary of Properties by Major Market

30

Leasing Summary

31

Occupancy and Leasing Analysis by Property Type and Major Market (3 Months Ended 6/30/2007)

32

Occupancy and Leasing Analysis by Property Type and Major Market (6 Months Ended 6/30/2007)

33

Tenants Representing 1% or More of Total Rent

34

Three Year Lease Expiration Schedule by Property Type

35

Three Year Lease Expiration Schedule by Major Market

36

Portfolio Lease Expiration Schedule

37

 

2




WARNING REGARDING

FORWARD LOOKING STATEMENTS

THIS SUPPLEMENTAL OPERATING AND FINANCIAL DATA REPORT CONTAINS STATEMENTS AND IMPLICATIONS WHICH CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER FEDERAL SECURITIES LAWS.  ALSO, WHENEVER WE USE WORDS SUCH AS “BELIEVE”, “EXPECT”, “ANTICIPATE”, “INTEND”, “PLAN”, “ESTIMATE” OR SIMILAR EXPRESSIONS, WE ARE MAKING FORWARD LOOKING STATEMENTS.  THESE FORWARD LOOKING STATEMENTS ARE BASED UPON OUR PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR.   ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY OUR FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS.

IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE IN OUR FORWARD LOOKING STATEMENTS ARE:

·  CHANGES IN THE ECONOMY AND THE CAPITAL MARKETS,

·  COMPETITION WITHIN THE REAL ESTATE INDUSTRY OR THOSE INDUSTRIES IN WHICH OUR TENANTS OPERATE, AND

·  CHANGES IN FEDERAL, STATE AND LOCAL LEGISLATION.

FOR EXAMPLE:

·  SOME OF OUR TENANTS MAY NOT RENEW EXPIRING LEASES, AND WE MAY BE UNABLE TO LOCATE NEW TENANTS TO MAINTAIN THE HISTORICAL OCCUPANCY RATES OF OUR PROPERTIES,

·  RENTS THAT WE CAN CHARGE AT OUR PROPERTIES MAY DECLINE,

·  OUR TENANTS MAY EXPERIENCE LOSSES AND BECOME UNABLE TO PAY OUR RENTS,

·  CONTINGENCIES IN OUR COMMITTED ACQUISITIONS MAY CAUSE THESE TRANSACTIONS NOT TO OCCUR OR TO BE DELAYED,

·  WE MAY BE UNABLE TO IDENTIFY PROPERTIES WHICH WE WANT TO BUY OR TO NEGOTIATE ACCEPTABLE PURCHASE PRICES, AND

OTHER RISKS MAY ADVERSELY IMPACT US, AS DESCRIBED MORE FULLY IN OUR ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2006, UNDER “ITEM 1A. RISK FACTORS.”

YOU SHOULD NOT PLACE UNDUE RELIANCE UPON ANY FORWARD LOOKING STATEMENTS.

EXCEPT AS REQUIRED BY LAW, WE UNDERTAKE NO OBLIGATION TO UPDATE OR REVISE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.




CORPORATE INFORMATION

  




HRPT Properties Trust
Supplemental Operating and Financial Data
June 30, 2007

COMPANY PROFILE

The Company:

HRPT Properties Trust, or HRPT, is a real estate investment trust, or REIT, which primarily owns office buildings located throughout the United States.  The majority of our properties are commercial office buildings located in central business district, or CBD, and suburban areas of major metropolitan markets.  At June 30, 2007, we also owned approximately 17 million square feet of leased industrial and commercial lands in Oahu, Hawaii.  We have large concentrations of properties leased to the U.S. Government and medical related tenants.  We have been investment grade rated since 1994 and we are included in a number of financial indices, including the Russell 1000®, the MSCI US REIT Index, the S&P REIT Composite Index and the FTSE NAREIT Composite Index.

Strategy:

Our primary business strategy is to efficiently operate our properties to maintain high occupancies, at market rents, with strong credit quality tenants.  We attempt to maintain an investment portfolio that is balanced between “security” and “growth”.  The security part of our portfolio includes properties that are long term leased or leased to tenants we believe are likely to renew their occupancy, such as government agencies, tenants in medical related industries and our leased lands in Hawaii.  The growth part of our portfolio includes our multi-tenant commercial office buildings, which we believe may generate higher rents and appreciate in value in the future because of their physical qualities and locations.  Although we sometimes sell properties, we consider ourselves to be a long term investor and are more interested in the long term earnings potential of our properties than selling properties for short term gains.  We currently do not have any investments in joint venture or off balance sheet entities.  We generally do not undertake speculative development, but we will sometimes do a build to suit development project.

Management:

HRPT is managed by Reit Management & Research LLC, or RMR.  RMR was founded in 1986 to manage public investments in real estate.  As of June 30, 2007, RMR managed one of the largest portfolios of publicly owned real estate in North America, including over 1,270 properties with 300 million square feet located in 44 states, Washington, DC, Puerto Rico and Ontario, Canada.  RMR has approximately 460 employees in its headquarters and regional offices located throughout the Country.  In addition to managing HRPT, RMR and its affiliates also manage Hospitality Properties Trust, a publicly traded REIT that owns hotels and travel centers, Senior Housing Properties Trust, a publicly traded REIT that owns senior living properties, and six mutual funds which invest in unaffiliated real estate companies.  The public companies managed by RMR and its affiliates had combined total market capitalization of over $16 billion as of June 30, 2007.  We believe that being managed by RMR is a competitive advantage for HRPT because RMR provides HRPT with a depth and quality of management and experience which may be unequaled in the real estate industry.  We also believe RMR is able to provide management services to HRPT at costs that are lower than HRPT would have to pay for similar quality services.

Corporate Headquarters:

 

400 Centre Street

Newton, MA 02458

(t) (617) 332-3990

(f) (617) 332-2261

 

Stock Exchange Listing:

 

New York Stock Exchange

 

Trading Symbols:

 

Common Stock – HRP

Preferred Stock Series B – HRP-B

Preferred Stock Series C – HRP-C

Preferred Stock Series D – HRP-D

 

Senior Unsecured Debt Ratings:

 

Moody's – Baa2

Standard & Poor's – BBB

 

 

Portfolio Data (as of 6/30/07):

Total properties

 

524

 

Total sq. ft. (000s)

 

63,571

 

Percent leased

 

92.9

%

 

Portfolio Concentration by Sq. Ft. (as of 6/30/07):

 

 

Office

 

Industrial

 

Total

 

CBD

 

17.8

%

0.3

%

18.1

%

Suburban

 

37.3

%

44.6

%

81.9

%

Total

 

55.1

%

44.9

%

100.0

%

 

Portfolio Concentration by NOI (Q2 2007) (1):

 

 

Office

 

Industrial

 

Total

 

CBD

 

30.8

%

0.2

%

31.0

%

Suburban

 

49.3

%

19.7

%

69.0

%

Total

 

80.1

%

19.9

%

100.0

%

 

Portfolio Concentration by Major Market:

 

 

6/30/07

 

Q2 2007

 

 

 

Sq. Ft.

 

NOI

 

Metro Philadelphia, PA

 

8.5

%

12.7

%

Oahu, HI

 

28.2

%

9.9

%

Metro Washington, DC

 

4.2

%

9.6

%

Metro Boston, MA

 

4.8

%

8.3

%

Southern California

 

2.3

%

7.0

%

Metro Austin, TX

 

4.3

%

4.0

%

Other Markets

 

47.7

%

48.5

%

Total

 

100.0

%

100.0

%


(1)    We compute NOI, or property net operating income, as rental income from real estate less property operating expenses; NOI excludes income from other investments; see page 14 for calculation of NOI and reconciliation of NOI to Net Income Available for Common Shareholders.

5




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

INVESTOR INFORMATION

 

 

Board of Trustees

 

Barry M. Portnoy

Managing Trustee

 

 

Patrick F. Donelan

Independent Trustee

 

 

William A. Lamkin

Independent Trustee

 

 

Adam D. Portnoy

Managing Trustee

 

 

Frederick N. Zeytoonjian

Independent Trustee

 

Senior Management

 

John A. Mannix

President and Chief Operating Officer

 

John C. Popeo

Treasurer, Chief Financial Officer and Secretary

 

David M. Lepore

Senior Vice President

 

Jennifer B. Clark

Senior Vice President

 

Contact Information

 

Investor Relations

HRPT Properties Trust

400 Centre Street

Newton, MA 02458

(t) (617) 332-3990

(f) (617) 332-2261

(email) info@hrpreit.com

(website) www.hrpreit.com

 

Inquiries

Financial inquiries should be directed to John C. Popeo,

Treasurer and Chief Financial Officer, at (617) 332-3990

or jpopeo@reitmr.com.

 

Investor and media inquiries should be directed to

Timothy A. Bonang, Manager of Investor Relations, at

(617) 796-8149 or tbonang@reitmr.com.

 

6




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

RESEARCH COVERAGE

 

 

Equity Research Coverage

 

Cantor Fitzgerald

Philip Martin

(312) 469-7485

 

Ferris, Baker Watts

Charles Place

(410) 659-4657

 

Raymond James

Paul Puryear

(727) 573-3800

 

RBC Capital Markets

David Rodgers

(216) 378-7626

 

Citigroup

Michael Bilerman

(212) 816-1383

 

Stifel, Nicolaus

John Guinee

(410) 454-5520

 

Debt Research Coverage

 

Banc of America Securities

Chris Brown

(704) 386-2524

 

Bear Stearns & Company

Susan Berliner

(212) 272-3824

 

Citigroup

Thomas Cook

(212) 723-1112

 

Credit Suisse First Boston

Matthew Lynch

(212) 325-6456

 

Merrill Lynch

John Forrey

(212) 449-1812

 

Wachovia Securities

Dan Sullivan

(704) 383-6441

 

 

Rating Agencies

 

Moody’s Investors Service

Lori Marks

(212) 553-1098

 

Standard and Poor’s

Linda Phelps

(212) 438-3059

 

HRPT is followed by the analysts and its publicly held debt and preferred shares are rated by the rating agencies listed above.  Please note that any opinions, estimates or forecasts regarding HRPT's performance made by these analysts or agencies do not represent opinions, forecasts or predictions of HRPT or its management.  HRPT does not by its reference above imply its endorsement of or concurrence with any information, conclusions or recommendations provided by any of these analysts or agencies.

7




FINANCIAL INFORMATION




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

KEY FINANCIAL DATA

(amounts in thousands, except per share data)

 

 

As of and For the Three Months Ended

 

 

 

6/30/2007

 

3/31/2007

 

12/31/2006

 

9/30/2006

 

6/30/2006

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares Outstanding:

 

 

 

 

 

 

 

 

 

 

 

Common shares outstanding (at end of period)

 

211,947

 

211,057

 

210,052

 

210,037

 

209,986

 

Common shares outstanding (at end of period) – diluted (1)

 

241,139

 

240,249

 

239,244

 

210,037

 

209,986

 

Preferred shares outstanding (at end of period) (1)

 

33,180

 

33,180

 

33,180

 

18,000

 

18,000

 

Weighted average common shares and units outstanding - basic

 

211,721

 

210,609

 

210,039

 

209,992

 

209,968

 

Weighted average common shares and units outstanding - diluted (1)

 

240,914

 

239,801

 

236,058

 

209,992

 

209,968

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Share Data:

 

 

 

 

 

 

 

 

 

 

 

Price at end of period

 

$

10.40

 

$

12.30

 

$

12.35

 

$

11.95

 

$

11.56

 

High during period

 

$

12.72

 

$

13.67

 

$

12.81

 

$

12.22

 

$

11.80

 

Low during period

 

$

10.13

 

$

12.04

 

$

11.34

 

$

10.80

 

$

10.50

 

Annualized dividends paid per share

 

$

0.84

 

$

0.84

 

$

0.84

 

$

0.84

 

$

0.84

 

Annualized dividend yield (at end of period)

 

8.1

%

6.8

%

6.8

%

7.0

%

7.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Market Capitalization:

 

 

 

 

 

 

 

 

 

 

 

Total debt (book value)

 

$

2,614,133

 

$

2,499,305

 

$

2,397,231

 

$

2,639,621

 

$

2,611,077

 

Plus: market value of preferred shares (at end of period)

 

817,108

 

860,432

 

863,228

 

464,160

 

458,220

 

Plus: market value of common shares (at end of period)

 

2,204,249

 

2,596,001

 

2,594,142

 

2,509,942

 

2,427,438

 

Total market capitalization

 

$

5,635,490

 

$

5,955,738

 

$

5,854,601

 

$

5,613,723

 

$

5,496,735

 

Total debt / total market capitalization

 

46.4

%

42.0

%

40.9

%

47.0

%

47.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Book Capitalization:

 

 

 

 

 

 

 

 

 

 

 

Total debt

 

$

2,614,133

 

$

2,499,305

 

$

2,397,231

 

$

2,639,621

 

$

2,611,077

 

Plus: total stockholders’ equity

 

2,961,698

 

2,979,177

 

2,950,768

 

2,641,881

 

2,663,253

 

Total book capitalization

 

$

5,575,831

 

$

5,478,482

 

$

5,347,999

 

$

5,281,502

 

$

5,274,330

 

Total debt / total book capitalization

 

46.9

%

45.6

%

44.8

%

50.0

%

49.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Selected Balance Sheet Data:

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

5,750,889

 

$

5,636,768

 

$

5,575,949

 

$

5,454,778

 

$

5,441,519

 

Total liabilities

 

$

2,789,191

 

$

2,657,591

 

$

2,625,181

 

$

2,812,897

 

$

2,778,266

 

Gross book value of real estate assets (2)

 

$

6,198,307

 

$

6,022,930

 

$

5,958,680

 

$

5,773,686

 

$

5,756,687

 

Total debt / gross book value of real estate (2)

 

42.2

%

41.5

%

40.2

%

45.7

%

45.4

%

 

 

 

 

 

 

 

 

 

 

 

 

Selected Income Statement Data (3):

 

 

 

 

 

 

 

 

 

 

 

Rental income

 

$

209,995

 

$

205,050

 

$

205,763

 

$

202,542

 

$

197,957

 

EBITDA (4)

 

$

120,272

 

$

116,930

 

$

116,436

 

$

114,429

 

$

113,769

 

Property net operating income (NOI) (5)

 

$

128,829

 

$

125,049

 

$

123,032

 

$

122,323

 

$

121,998

 

NOI margin (6)

 

61.3

%

61.0

%

59.8

%

60.4

%

61.6

%

Net income

 

$

31,474

 

$

33,148

 

$

37,877

 

$

31,354

 

$

31,514

 

Preferred distributions

 

$

(15,401

)

$

(15,401

)

$

(14,716

)

$

(9,234

)

$

(9,234

)

Net income available for common shareholders

 

$

16,073

 

$

17,747

 

$

23,161

 

$

22,120

 

$

22,280

 

Funds from operations (FFO) (7)

 

$

77,971

 

$

76,659

 

$

76,859

 

$

71,260

 

$

71,915

 

FFO available for common shareholders (7)

 

$

62,570

 

$

61,258

 

$

62,143

 

$

62,026

 

$

62,681

 

Common distributions paid

 

$

44,390

 

$

44,111

 

$

44,107

 

$

44,097

 

$

44,095

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Data (1):

 

 

 

 

 

 

 

 

 

 

 

Net income available for common shareholders – basic and diluted

 

$

0.08

 

$

0.08

 

$

0.11

 

$

0.11

 

$

0.11

 

FFO available for common shareholders – basic (7)

 

$

0.30

 

$

0.29

 

$

0.30

 

$

0.30

 

$

0.30

 

FFO available for common shareholders – diluted (1) (7)

 

$

0.29

 

$

0.28

 

$

0.29

 

$

0.30

 

$

0.30

 

Common distributions paid

 

$

0.21

 

$

0.21

 

$

0.21

 

$

0.21

 

$

0.21

 

FFO payout ratio

 

70.9

%

72.0

%

71.0

%

71.1

%

70.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Coverage Ratios:

 

 

 

 

 

 

 

 

 

 

 

EBITDA (4) / interest expense

 

2.8

x

2.9

x

2.9

x

2.7

x

2.7

x

EBITDA (4) / interest expense and preferred distributions

 

2.1

x

2.1

x

2.1

x

2.2

x

2.2

x

 


(1)          At 6/30/2007, we had 15,180 preferred shares outstanding that were convertible into 29,193 common shares.  See page 16 for calculations of diluted net income, FFO, and weighted average common shares outstanding.

(2)          Gross book value of real estate assets is real estate properties, at cost, including purchase price allocations less impairment writedowns, if any.

(3)   Results exclude properties classified in discontinued operations, if any.

(4)   See page 13 for calculation of EBITDA.

(5)          Property net operating income, or NOI, is defined as rental income from real estate less property operating expenses; NOI excludes income from other investments; see page 14 for calculation of NOI and reconciliation of NOI to Net Income Available for Common Shareholders.

(6)   NOI margin is defined as property net operating income, or NOI, as a percentage of rental income.

(7)   See page 15 for calculation of FFO and FFO available for common shareholders.

9




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

CONSOLIDATED BALANCE SHEETS

(amounts in thousands, except share data)

 

 

As of
June 30,
2007

 

As of
December 31,
2006

 

 

 

 

 

(audited)

 

ASSETS

 

 

 

 

 

Real estate properties:

 

 

 

 

 

Land

 

$

1,167,702

 

$

1,143,109

 

Buildings and improvements

 

4,821,438

 

4,619,164

 

 

 

5,989,140

 

5,762,273

 

Accumulated depreciation

 

(736,336

)

(668,460

)

 

 

5,252,804

 

5,093,813

 

Acquired real estate leases

 

163,224

 

167,879

 

Cash and cash equivalents

 

29,026

 

17,783

 

Restricted cash

 

16,571

 

21,635

 

Rents receivable, net of allowance for doubtful accounts of $5,830 and $4,737, respectively

 

182,980

 

172,566

 

Other assets, net

 

106,284

 

102,273

 

Total assets

 

$

5,750,889

 

$

5,575,949

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

Revolving credit facility

 

$

212,000

 

$

40,000

 

Senior unsecured debt, net

 

1,991,241

 

1,941,173

 

Mortgage notes payable, net

 

410,892

 

416,058

 

Accounts payable and accrued expenses

 

87,111

 

93,734

 

Dividends payable

 

 

44,111

 

Acquired real estate lease obligations

 

40,942

 

41,833

 

Rent collected in advance

 

22,736

 

19,592

 

Security deposits

 

16,076

 

15,972

 

Due to affiliates

 

8,193

 

12,708

 

Total liabilities

 

2,789,191

 

2,625,181

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

Preferred shares of beneficial interest, $0.01 par value:

 

 

 

 

 

50,000,000 shares authorized;

 

 

 

 

 

Series B preferred shares; 8 3/4% cumulative redeemable at par on or after September 12, 2007; 12,000,000 shares issued and outstanding,  aggregate liquidation preference $300,000

 

289,849

 

289,849

 

Series C preferred shares; 7 1/8% cumulative redeemable at par on or after February 15, 2011; 6,000,000 shares issued and outstanding, aggregate liquidation preference $150,000

 

145,015

 

145,015

 

Series D preferred shares; 6 1/2% cumulative convertible; 15,180,000 shares issued and outstanding, aggregate liquidation preference $379,500

 

368,270

 

368,270

 

Common shares of beneficial interest, $0.01 par value:

 

 

 

 

 

300,000,000 shares authorized; 211,946,590 and 210,051,590 shares issued and outstanding, respectively

 

2,119

 

2,101

 

Additional paid in capital

 

2,798,279

 

2,774,461

 

Cumulative net income

 

1,767,976

 

1,703,354

 

Cumulative common distributions

 

(2,159,689

)

(2,115,299

)

Cumulative preferred distributions

 

(250,121

)

(216,983

)

Total shareholders' equity

 

2,961,698

 

2,950,768

 

Total liabilities and shareholders' equity

 

$

5,750,889

 

$

5,575,949

 

 

10




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

CONSOLIDATED STATEMENTS OF INCOME

(amounts in thousands, except per share data)

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

 

 

 

 

 

 

 

 

 

 

Rental income (1)

 

$

209,995

 

$

197,957

 

$

415,045

 

$

387,516

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

Operating expenses

 

81,166

 

75,959

 

161,167

 

147,762

 

Depreciation and amortization

 

45,786

 

40,379

 

89,297

 

78,045

 

General and administrative

 

9,125

 

8,540

 

17,703

 

16,413

 

Total expenses

 

136,077

 

124,878

 

268,167

 

242,220

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

73,918

 

73,079

 

146,878

 

145,296

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

568

 

310

 

1,027

 

1,545

 

Interest expense (including amortization of debt discounts, premiums and deferred financing fees of $1,025, $1,105, $2,122 and $2,243, respectively)

 

(42,301

)

(41,854

)

(82,572

)

(83,148

)

Loss on early extinguishment of debt

 

(711

)

 

(711

)

(1,659

)

Equity in earnings of equity investments

 

 

 

 

3,136

 

Gain on sale of equity investments

 

 

 

 

116,287

 

Income from continuing operations

 

31,474

 

31,535

 

64,622

 

181,457

 

Loss from discontinued operations

 

 

(21

)

 

(108

)

Net income

 

31,474

 

31,514

 

64,622

 

181,349

 

Preferred distributions

 

(15,401

)

(9,234

)

(30,802

)

(20,742

)

Excess redemption price paid over carrying value of preferred shares

 

 

 

 

(6,914

)

Net income available for common shareholders

 

$

16,073

 

$

22,280

 

$

33,820

 

$

153,693

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding – basic

 

211,721

 

209,968

 

211,168

 

209,915

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding – diluted (2)

 

240,914

 

209,968

 

240,361

 

209,915

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

Income from continuing operations available for common shareholders – basic and diluted (2)

 

$

0.08

 

$

0.11

 

$

0.16

 

$

0.73

 

Loss from discontinued operations – basic and diluted (2)

 

$

 

$

 

$

 

$

 

Net income available for common shareholders – basic and diluted (2)

 

$

0.08

 

$

0.11

 

$

0.16

 

$

0.73

 

 

 

 

 

 

 

 

 

 

 

Additional Data:

 

 

 

 

 

 

 

 

 

General and administrative expenses / rental income

 

4.35

%

4.31

%

4.27

%

4.24

%

General and administrative expenses / total assets (at end of period)

 

0.16

%

0.16

%

0.31

%

0.30

%

 

 

 

 

 

 

 

 

 

 

Non cash straight line rent adjustments (FAS 13) (1)

 

$

3,914

 

$

5,230

 

$

8,638

 

$

10,057

 

Lease value amortization (FAS 141) (1)

 

$

(2,880

)

$

(2,293

)

$

(5,327

)

$

(5,482

)

Lease termination fees included in rental income

 

$

31

 

$

251

 

$

356

 

$

500

 

Capitalized interest expense

 

$

263

 

$

 

$

489

 

$

 

 


(1)          We report rental income on a straight line basis over the terms of the respective leases; rental income includes non-cash straight line rent adjustments. Rental income also includes non-cash amortization of intangible lease assets and liabilities.

(2)          At 6/30/2007, we had 15,180 series D preferred shares outstanding that were convertible into 29,193 common shares.  See page 16 for calculations of diluted net income and weighted average common shares outstanding.

11




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

CONSOLIDATED STATEMENTS OF CASH FLOWS

(amounts in thousands)

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

Net income

 

$

31,474

 

$

31,514

 

$

64,622

 

$

181,349

 

Adjustments to reconcile net income to cash provided by operating activities:

 

 

 

 

 

 

 

 

 

Depreciation

 

36,446

 

32,594

 

71,451

 

63,297

 

Amortization of debt discounts, premiums and deferred financing fees

 

1,025

 

1,105

 

2,122

 

2,243

 

Amortization of acquired real estate leases

 

8,320

 

7,293

 

16,044

 

14,968

 

Other amortization

 

3,900

 

2,809

 

7,129

 

5,371

 

Loss on early extinguishment of debt

 

711

 

 

711

 

1,659

 

Equity in earnings of equity investments

 

 

 

 

(3,136

)

Gain on sale of equity investments

 

 

 

 

(116,287

)

Distributions of earnings from equity investments

 

 

 

 

3,136

 

Change in assets and liabilities:

 

 

 

 

 

 

 

 

 

(Increase) decrease in restricted cash

 

(2,336

)

(2,615

)

5,064

 

2,417

 

Decrease (increase) in rents receivable and other assets

 

2,469

 

2,472

 

(22,462

)

(28,185

)

Increase (decrease) in accounts payable and accrued expenses

 

12,915

 

12,651

 

(10,705

)

(396

)

(Decrease) increase in rent collected in advance

 

(196

)

(2,580

)

3,144

 

2,676

 

Increase in security deposits

 

206

 

504

 

104

 

1,402

 

Increase (decrease) in due to affiliates

 

745

 

(2,091

)

(4,515

)

(3,331

)

Cash provided by operating activities

 

95,679

 

83,656

 

132,709

 

127,183

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

Real estate acquisitions and improvements

 

(153,501

)

(114,639

)

(238,235

)

(325,054

)

Distributions in excess of earnings from equity investments

 

 

 

 

2,251

 

Proceeds from sale of equity investments

 

 

 

 

308,333

 

Cash used for investing activities

 

(153,501

)

(114,639

)

(238,235

)

(14,470

)

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

Proceeds from issuance of preferred shares, net

 

 

 

 

145,015

 

Redemption of preferred shares

 

 

 

 

(200,000

)

Proceeds from issuance of common shares, net

 

10,663

 

 

23,661

 

 

Proceeds from borrowings

 

584,475

 

113,000

 

704,475

 

964,000

 

Payments on borrowings

 

(469,888

)

(28,494

)

(488,051

)

(894,210

)

Deferred financing fees

 

(1,670

)

(503

)

(1,677

)

(1,847

)

Distributions to common shareholders

 

(44,390

)

(44,095

)

(88,501

)

(88,166

)

Distributions to preferred shareholders

 

(15,401

)

(9,413

)

(33,138

)

(21,851

)

Cash provided by (used for) financing activities

 

63,789

 

30,495

 

116,769

 

(97,059

)

 

 

 

 

 

 

 

 

 

 

Increase (decrease) in cash and cash equivalents

 

5,967

 

(488

)

11,243

 

15,654

 

Cash and cash equivalents at beginning of period

 

23,059

 

35,587

 

17,783

 

19,445

 

Cash and cash equivalents at end of period

 

$

29,026

 

$

35,099

 

$

29,026

 

$

35,099

 

 

 

 

 

 

 

 

 

 

 

Supplemental cash flow information:

 

 

 

 

 

 

 

 

 

Interest paid (including capitalized interest paid of $263 and $489 in 2007, respectively)

 

$

32,503

 

$

30,988

 

$

80,508

 

$

79,188

 

 

 

 

 

 

 

 

 

 

 

Non-cash investing activities:

 

 

 

 

 

 

 

 

 

Real estate acquisitions

 

$

 

$

(13,053

)

$

 

$

(20,585

)

 

 

 

 

 

 

 

 

 

 

Non-cash financing activities:

 

 

 

 

 

 

 

 

 

Issuance of common shares

 

$

175

 

$

1,420

 

$

175

 

$

1,420

 

Assumption of mortgage notes payable

 

 

13,053

 

 

20,585

 

 

12




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

CALCULATION OF EBITDA

(amounts in thousands)

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

31,474

 

$

31,514

 

$

64,622

 

$

181,349

 

Plus:  interest expense

 

42,301

 

41,854

 

82,572

 

83,148

 

Plus:  income taxes

 

 

 

 

 

Plus:  depreciation and amortization

 

45,786

 

40,401

 

89,297

 

78,152

 

Plus:  loss on early extinguishment of debt

 

711

 

 

711

 

1,659

 

Less:  gain on sale of equity investments

 

 

 

 

(116,287

)

Less:  equity in earnings of equity investments

 

 

 

 

(3,136

)

Plus:  EBITDA from equity investments

 

 

 

 

8,446

 

EBITDA

 

$

120,272

 

$

113,769

 

$

237,202

 

$

233,331

 

 

We compute EBITDA, or earnings before interest, taxes, depreciation and amortization, as net income less gains on equity transactions of equity investments and gains on sales of properties, plus loss on early extinguishment of debt, interest expense, depreciation and amortization and the difference between EBITDA and earnings from equity investments.  We consider EBITDA to be an appropriate measure of our performance, along with net income and cash flow from operating, investing and financing activities.  We believe EBITDA provides useful information to investors because, by excluding the effects of certain historical costs, such as interest, depreciation and amortization expense, EBITDA can facilitate a comparison of our current operating performance with our past operating performance and of operating performances among REITs.  EBITDA does not represent cash generated by operating activities in accordance with generally accepted accounting principles, or GAAP, and should not be considered an alternative to net income or cash flow from operating activities as a measure of financial performance or liquidity.

13




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

CALCULATION AND RECONCILIATION OF PROPERTY NET OPERATING INCOME (NOI)

(amounts in thousands)

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

 

 

 

 

 

 

 

 

 

 

Calculation of NOI (1):

 

 

 

 

 

 

 

 

 

Rental income

 

$

209,995

 

$

197,957

 

$

415,045

 

$

387,516

 

Operating expenses

 

(81,166

)

(75,959

)

(161,167

)

(147,762

)

Property net operating income (NOI)

 

$

128,829

 

$

121,998

 

$

253,878

 

$

239,754

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of NOI to Net Income Available for Common Shareholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property net operating income

 

$

128,829

 

$

121,998

 

$

253,878

 

$

239,754

 

Depreciation and amortization

 

(45,786

)

(40,379

)

(89,297

)

(78,045

)

General and administrative

 

(9,125

)

(8,540

)

(17,703

)

(16,413

)

Operating income

 

73,918

 

73,079

 

146,878

 

145,296

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

568

 

310

 

1,027

 

1,545

 

Interest expense

 

(42,301

)

(41,854

)

(82,572

)

(83,148

)

Loss on early extinguishment of debt

 

(711

)

 

(711

)

(1,659

)

Equity in earnings of equity investments

 

 

 

 

3,136

 

Gain on sale of equity investments

 

 

 

 

116,287

 

Income from continuing operations

 

31,474

 

31,535

 

64,622

 

181,457

 

 

 

 

 

 

 

 

 

 

 

Loss from discontinued operations

 

 

(21

)

 

(108

)

Net income

 

31,474

 

31,514

 

64,622

 

181,349

 

 

 

 

 

 

 

 

 

 

 

Preferred distributions

 

(15,401

)

(9,234

)

(30,802

)

(20,742

)

Excess redemption price paid over carrying value of preferred shares

 

 

 

 

(6,914

)

Net income available for common shareholders

 

$

16,073

 

$

22,280

 

$

33,820

 

$

153,693

 

 


(1)  Excludes properties classified in discontinued operations.

We compute NOI as shown above.  We consider NOI to be an appropriate supplemental measure to net income available for common shareholders because it helps both investors and management to understand the operations of our properties.  We use NOI internally as a performance measure and believe NOI provides useful information to investors regarding our results of operations because it reflects only those income and expense items that are incurred at the property level.  Our management also uses NOI to evaluate individual, regional and company wide property level performance.  NOI excludes certain components from net income available for common shareholders in order to provide results that are more closely related to our properties' results of operations.  NOI does not represent cash generated by operating activities in accordance with generally accepted accounting principles, or GAAP, and should not be considered an alternative to net income, net income available for common shareholders or cash flow from operating activities as a measure of financial performance. 

14




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

CALCULATION OF FUNDS FROM OPERATIONS (FFO)

(amounts in thousands, except per share data)

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

31,474

 

$

31,514

 

$

64,622

 

$

181,349

 

Plus:  depreciation and amortization

 

45,786

 

40,401

 

89,297

 

78,152

 

Loss on early extinguishment of debt:

 

 

 

 

 

 

 

 

 

Add:  amount included in expenses

 

711

 

 

711

 

1,659

 

Less:  portion settled in cash

 

 

 

 

 

Less:  gain on sale of equity investments

 

 

 

 

(116,287

)

Less:  equity in earnings of equity investments

 

 

 

 

(3,136

)

Plus:  FFO from equity investments

 

 

 

 

6,426

 

FFO

 

77,971

 

71,915

 

154,630

 

148,163

 

Less:  preferred distributions

 

(15,401

)

(9,234

)

(30,802

)

(20,742

)

FFO available for common shareholders

 

$

62,570

 

$

62,681

 

$

123,828

 

$

127,421

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding – basic

 

211,721

 

209,968

 

211,168

 

209,915

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding – diluted (1)

 

240,914

 

209,968

 

240,361

 

209,915

 

 

 

 

 

 

 

 

 

 

 

FFO available for common shareholders per share – basic

 

$

0.30

 

$

0.30

 

$

0.59

 

$

0.61

 

 

 

 

 

 

 

 

 

 

 

FFO available for common shareholders per share – diluted (1)

 

$

0.29

 

$

0.30

 

$

0.57

 

$

0.61

 

 


(1)          At 6/30/2007, we had 15,180 series D preferred shares outstanding that were convertible into 29,193 common shares.  See page 16 for calculations of diluted FFO available for common shareholders and weighted average common shares outstanding.

We compute FFO, FFO available for common shareholders and diluted FFO available for common shareholders as shown above.  Our calculation of FFO differs from the National Association of Real Estate Investment Trusts, or NAREIT, definition because we add loss on early extinguishment of debt unless settled in cash.  We consider FFO to be an appropriate measure of performance for a REIT, along with net income and cash flow from operating, investing and financing activities. We believe that FFO provides useful information to investors because by excluding the effects of certain historical amounts, such as depreciation expense and gains or losses on sales of properties, FFO can facilitate a comparison of operating performances among REITs.  FFO does not represent cash generated by operating activities in accordance with generally accepted accounting principles, or GAAP, and should not be considered an alternative to net income or cash flow from operating activities as a measure of financial performance or liquidity.  FFO is one important factor considered by our Board of Trustees in determining the amount of distributions to shareholders.  Other important factors include, but are not limited to, requirements to maintain our status as a REIT, limitations in our revolving credit facility and public debt covenants, the availability of debt and equity capital to us and our expectations of future capital requirements and operating performance.

15




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

CALCULATION OF DILUTED NET INCOME, FFO AND WEIGHTED AVERAGE

COMMON SHARES OUTSTANDING

(amounts in thousands, except per share data)

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

 

 

 

 

 

 

 

 

 

 

Net income available for common shareholders

 

$

16,073

 

$

22,280

 

$

33,820

 

$

153,693

 

Add – Series D convertible preferred distributions (1)

 

6,167

 

 

12,334

 

 

Net income available for common shareholders – diluted

 

$

22,240

 

$

22,280

 

$

46,154

 

$

153,693

 

 

 

 

 

 

 

 

 

 

 

FFO available for common shareholders (2)

 

$

62,570

 

$

62,681

 

$

123,828

 

$

127,421

 

Add – Series D convertible preferred distributions (1)

 

6,167

 

 

12,334

 

 

FFO available for common shareholders – diluted

 

$

68,737

 

$

62,681

 

$

136,162

 

$

127,421

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding -- basic

 

211,721

 

209,968

 

211,168

 

209,915

 

Effect of dilutive Series D preferred shares (1)

 

29,193

 

 

29,193

 

 

Weighted average common shares outstanding – diluted

 

240,914

 

209,968

 

240,361

 

209,915

 

 


(1)          At 6/30/2007, we had 15,180 series D preferred shares outstanding that were convertible into 29,193 common shares.

(2)          See page 15 for calculation of FFO available for common shareholders.

16




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

SUMMARY RESULTS OF OPERATIONS BY PROPERTY TYPE

(dollars and sq. ft. in thousands)

 

 

As of and For the Three Months Ended (1)

 

As of and For the Six Months Ended (1)

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

 

 

 

 

 

 

 

 

 

 

Number of Properties:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

361

 

349

 

361

 

349

 

Industrial

 

163

 

138

 

163

 

138

 

Total

 

524

 

487

 

524

 

487

 

 

 

 

 

 

 

 

 

 

 

CBD

 

50

 

50

 

50

 

50

 

Suburban

 

474

 

437

 

474

 

437

 

Total

 

524

 

487

 

524

 

487

 

 

 

 

 

 

 

 

 

 

 

Square Feet (2):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

35,012

 

34,058

 

35,012

 

34,058

 

Industrial

 

28,559

 

23,971

 

28,559

 

23,971

 

Total

 

63,571

 

58,029

 

63,571

 

58,029

 

 

 

 

 

 

 

 

 

 

 

CBD

 

11,482

 

11,486

 

11,482

 

11,486

 

Suburban

 

52,089

 

46,543

 

52,089

 

46,543

 

Total

 

63,571

 

58,029

 

63,571

 

58,029

 

 

 

 

 

 

 

 

 

 

 

Percent Leased (3):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

90.4

%

91.6

%

90.4

%

91.6

%

Industrial

 

96.0

%

96.4

%

96.0

%

96.4

%

Total

 

92.9

%

93.6

%

92.9

%

93.6

%

 

 

 

 

 

 

 

 

 

 

CBD

 

90.6

%

92.4

%

90.6

%

92.4

%

Suburban

 

93.5

%

93.9

%

93.5

%

93.9

%

Total

 

92.9

%

93.6

%

92.9

%

93.6

%

 

 

 

 

 

 

 

 

 

 

Rental Income (4):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

$

175,863

 

$

169,758

 

$

350,459

 

$

333,286

 

Industrial

 

34,132

 

28,199

 

64,586

 

54,230

 

Total

 

$

209,995

 

$

197,957

 

$

415,045

 

$

387,516

 

 

 

 

 

 

 

 

 

 

 

CBD

 

$

71,473

 

$

71,756

 

$

141,964

 

$

143,136

 

Suburban

 

138,522

 

126,201

 

273,081

 

244,380

 

Total

 

$

209,995

 

$

197,957

 

$

415,045

 

$

387,516

 

 

 

 

 

 

 

 

 

 

 

Property Net Operating Income (NOI) (5):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

$

103,164

 

$

101,505

 

$

206,199

 

$

200,144

 

Industrial

 

25,665

 

20,493

 

47,679

 

39,610

 

Total

 

$

128,829

 

$

121,998

 

$

253,878

 

$

239,754

 

 

 

 

 

 

 

 

 

 

 

CBD

 

$

39,862

 

$

40,477

 

$

79,028

 

$

80,506

 

Suburban

 

88,967

 

81,521

 

174,850

 

159,248

 

Total

 

$

128,829

 

$

121,998

 

$

253,878

 

$

239,754

 

 

 

 

 

 

 

 

 

 

 

NOI Margin (6):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

58.7

%

59.8

%

58.8

%

60.1

%

Industrial

 

75.2

%

72.7

%

73.8

%

73.0

%

Total

 

61.3

%

61.6

%

61.2

%

61.9

%

 

 

 

 

 

 

 

 

 

 

CBD

 

55.8

%

56.4

%

55.7

%

56.2

%

Suburban

 

64.2

%

64.6

%

64.0

%

65.2

%

Total

 

61.3

%

61.6

%

61.2

%

61.9

%

 


(1)          Excludes properties classified in discontinued operations.

(2)          Prior periods exclude space remeasurements made during the current period.

(3)          Percent leased includes (i) space being fitted out for occupancy pursuant to signed leases and (ii) space which is leased, but is not occupied or is being offered for sublease by tenants.

(4)          Includes some triple net lease rental income. 

(5)          Property net operating income, or NOI, is defined as property rental income less property operating expenses; see page 14 for calculation of NOI and reconciliation of NOI to Net Income Available for Common Shareholders. 

(6)          NOI margin is defined as NOI as a percentage of rental income.

17




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

SUMMARY RESULTS OF OPERATIONS BY MAJOR MARKET

(dollars and sq. ft. in thousands)

 

 

As of and For the Three Months Ended (1)

 

As of and For the Six Months Ended (1)

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

Number of Properties:

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

21

 

21

 

21

 

21

 

Oahu, HI

 

57

 

56

 

57

 

56

 

Metro Washington, DC

 

20

 

20

 

20

 

20

 

Metro Boston, MA

 

37

 

36

 

37

 

36

 

Southern California

 

24

 

24

 

24

 

24

 

Metro Austin, TX

 

26

 

26

 

26

 

26

 

Other markets

 

339

 

304

 

339

 

304

 

Total

 

524

 

487

 

524

 

487

 

 

 

 

 

 

 

 

 

 

 

Square Feet (2):

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

5,444

 

5,448

 

5,444

 

5,448

 

Oahu, HI

 

17,914

 

17,929

 

17,914

 

17,929

 

Metro Washington, DC

 

2,658

 

2,645

 

2,658

 

2,645

 

Metro Boston, MA

 

3,026

 

2,737

 

3,026

 

2,737

 

Southern California

 

1,444

 

1,444

 

1,444

 

1,444

 

Metro Austin, TX

 

2,727

 

2,807

 

2,727

 

2,807

 

Other markets

 

30,358

 

25,019

 

30,358

 

25,019

 

Total

 

63,571

 

58,029

 

63,571

 

58,029

 

 

 

 

 

 

 

 

 

 

 

Percent Leased (3):

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

90.0

%

90.8

%

90.0

%

90.8

%

Oahu, HI

 

96.9

%

97.3

%

96.9

%

97.3

%

Metro Washington, DC

 

91.4

%

96.6

%

91.4

%

96.6

%

Metro Boston, MA

 

96.3

%

96.8

%

96.3

%

96.8

%

Southern California

 

95.4

%

97.9

%

95.4

%

97.9

%

Metro Austin, TX

 

88.4

%

92.4

%

88.4

%

92.4

%

Other markets

 

91.2

%

90.7

%

91.2

%

90.7

%

Total

 

92.9

%

93.6

%

92.9

%

93.6

%

 

 

 

 

 

 

 

 

 

 

Rental Income (4):

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

$

31,466

 

$

31,632

 

$

62,512

 

$

63,493

 

Oahu, HI

 

16,142

 

15,119

 

31,495

 

29,211

 

Metro Washington, DC

 

19,814

 

19,495

 

39,327

 

39,210

 

Metro Boston, MA

 

16,175

 

14,996

 

31,489

 

30,028

 

Southern California

 

12,507

 

11,879

 

24,998

 

23,804

 

Metro Austin, TX

 

10,663

 

10,862

 

21,774

 

20,953

 

Other markets

 

103,228

 

93,974

 

203,450

 

180,817

 

Total

 

$

209,995

 

$

197,957

 

$

415,045

 

$

387,516

 

 

 

 

 

 

 

 

 

 

 

Property Net Operating Income (NOI) (5):

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

$

16,311

 

$

17,216

 

$

32,286

 

$

34,072

 

Oahu, HI

 

12,824

 

12,386

 

25,123

 

23,758

 

Metro Washington, DC

 

12,408

 

12,266

 

24,737

 

24,735

 

Metro Boston, MA

 

10,638

 

10,032

 

20,639

 

20,004

 

Southern California

 

9,030

 

8,173

 

18,275

 

16,562

 

Metro Austin, TX

 

5,177

 

5,469

 

10,939

 

10,610

 

Other markets

 

62,441

 

56,456

 

121,879

 

110,013

 

Total

 

$

128,829

 

$

121,998

 

$

253,878

 

$

239,754

 

 

 

 

 

 

 

 

 

 

 

NOI Margin (6):

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

51.8

%

54.4

%

51.6

%

53.7

%

Oahu, HI

 

79.4

%

81.9

%

79.8

%

81.3

%

Metro Washington, DC

 

62.6

%

62.9

%

62.9

%

63.1

%

Metro Boston, MA

 

65.8

%

66.9

%

65.5

%

66.6

%

Southern California

 

72.2

%

68.8

%

73.1

%

69.6

%

Metro Austin, TX

 

48.6

%

50.3

%

50.2

%

50.6

%

Other markets

 

60.5

%

60.1

%

59.9

%

60.8

%

Total

 

61.3

%

61.6

%

61.2

%

61.9

%

 


(1)   Excludes properties classified in discontinued operations.

(2)   Prior periods exclude space remeasurements made during the current period.

(3)          Percent leased includes (i) space being fitted out for occupancy pursuant to signed leases and (ii) space which is leased, but is not occupied or is being offered for sublease by tenants.

(4)   Includes some triple net lease rental income.

(5)          Property net operating income, or NOI, is defined as property rental income less property operating expenses; see page 14 for calculation of NOI and reconciliation of NOI to Net Income Available for Common Shareholders.

(6)   NOI margin is defined as NOI as a percentage of rental income.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes properties located in Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

18




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

SAME PROPERTY RESULTS AND ANALYSIS BY PROPERTY TYPE

(dollars and sq. ft. in thousands)

 

 

As of and For the Three Months Ended (1)

 

As of and For the Six Months Ended (2)

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

Office:

 

 

 

 

 

 

 

 

 

Properties

 

338

 

338

 

303

 

303

 

Total sq. ft.

 

33,207

 

33,207

 

31,377

 

31,377

 

Percent leased (3)

 

90.2

%

91.5

%

90.3

%

91.6

%

Rental income (4)

 

$

168,933

 

$

168,021

 

$

323,750

 

$

321,374

 

Property net operating income (NOI) (5)

 

$

98,558

 

$

100,359

 

$

190,382

 

$

192,341

 

NOI % growth

 

-1.8

%

 

 

-1.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Industrial:

 

 

 

 

 

 

 

 

 

Properties

 

136

 

136

 

134

 

134

 

Total sq. ft.

 

23,447

 

23,447

 

23,447

 

23,447

 

Percent leased (3)

 

95.9

%

96.5

%

95.9

%

96.5

%

Rental income (4)

 

$

28,649

 

$

27,894

 

$

56,402

 

$

53,924

 

Property net operating income (NOI) (5)

 

$

20,881

 

$

20,237

 

$

40,900

 

$

39,360

 

NOI % growth

 

3.2

%

 

 

3.9

%

 

 

 

 

 

 

 

 

 

 

 

 

CBD:

 

 

 

 

 

 

 

 

 

Properties

 

50

 

50

 

50

 

50

 

Total sq. ft.

 

11,482

 

11,482

 

11,482

 

11,482

 

Percent leased (3)

 

90.6

%

92.4

%

90.6

%

92.4

%

Rental income (4)

 

$

71,473

 

$

71,756

 

$

141,964

 

$

143,136

 

Property net operating income (NOI) (5)

 

$

39,862

 

$

40,477

 

$

79,028

 

$

80,506

 

NOI % growth

 

-1.5

%

 

 

-1.8

%

 

 

 

 

 

 

 

 

 

 

 

 

Suburban:

 

 

 

 

 

 

 

 

 

Properties

 

424

 

424

 

387

 

387

 

Total sq. ft.

 

45,172

 

45,172

 

43,342

 

43,342

 

Percent leased (3)

 

93.0

%

93.9

%

93.3

%

94.1

%

Rental income (4)

 

$

126,109

 

$

124,159

 

$

238,188

 

$

232,162

 

Property net operating income (NOI) (5)

 

$

79,577

 

$

80,119

 

$

152,254

 

$

151,195

 

NOI % growth

 

-0.7

%

 

 

0.7

%

 

 

 

 

 

 

 

 

 

 

 

 

Total:

 

 

 

 

 

 

 

 

 

Properties

 

474

 

474

 

437

 

437

 

Total sq. ft.

 

56,654

 

56,654

 

54,824

 

54,824

 

Percent leased (3)

 

92.5

%

93.6

%

92.7

%

93.7

%

Rental income (4)

 

$

197,582

 

$

195,915

 

$

380,152

 

$

375,298

 

Property net operating income (NOI) (5)

 

$

119,439

 

$

120,596

 

$

231,282

 

$

231,701

 

NOI % growth

 

-1.0

%

 

 

-0.2

%

 

 

 


(1)   Based on properties owned continuously since 4/1/2006 and excludes properties classified in discontinued operations.

(2)   Based on properties owned continuously since 1/1/2006 and excludes properties classified in discontinued operations.

(3)          Percent leased includes (i) space being fitted out for occupancy pursuant to signed leases and (ii) space which is leased, but is not occupied or is being offered for sublease by tenants.

(4)   Includes some triple net lease rental income.

(5)          Property net operating income, or NOI, is defined as property rental income less property operating expenses; see page 14 for calculation of NOI and reconciliation of NOI to Net Income Available for Common Shareholders.

19




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

SAME PROPERTY RESULTS AND ANALYSIS BY MAJOR MARKET

(dollars and sq. ft. in thousands)

 

 

As of and For the Three Months Ended (1)

 

As of and For the Six Months Ended (2)

 

 

 

6/30/2007

 

6/30/2006

 

6/30/2007

 

6/30/2006

 

Metro Philadelphia, PA:

 

 

 

 

 

 

 

 

 

Properties

 

21

 

21

 

21

 

21

 

Total sq. ft.

 

5,444

 

5,444

 

5,444

 

5,444

 

Percent leased (3)

 

90.0

%

90.8

%

90.0

%

90.8

%

Rental income (4)

 

$

31,466

 

$

31,632

 

$

62,512

 

$

63,493

 

Property net operating income (NOI) (5)

 

$

16,311

 

$

17,216

 

$

32,286

 

$

34,072

 

NOI % growth

 

-5.3

%

 

 

-5.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Oahu, HI:

 

 

 

 

 

 

 

 

 

Properties

 

55

 

55

 

53

 

53

 

Total sq. ft.

 

17,793

 

17,793

 

17,793

 

17,793

 

Percent leased (3)

 

97.5

%

97.5

%

97.5

%

97.5

%

Rental income (4)

 

$

16,137

 

$

15,119

 

$

31,489

 

$

29,211

 

Property net operating income (NOI) (5)

 

$

12,841

 

$

12,396

 

$

25,140

 

$

23,773

 

NOI % growth

 

3.6

%

 

 

5.8

%

 

 

 

 

 

 

 

 

 

 

 

 

Metro Washington, D.C.:

 

 

 

 

 

 

 

 

 

Properties

 

20

 

20

 

20

 

20

 

Total sq. ft.

 

2,658

 

2,658

 

2,658

 

2,658

 

Percent leased (3)

 

91.4

%

96.6

%

91.4

%

96.6

%

Rental income (4)

 

$

19,814

 

$

19,495

 

$

39,327

 

$

39,210

 

Property net operating income (NOI) (5)

 

$

12,408

 

$

12,266

 

$

24,737

 

$

24,735

 

NOI % growth

 

1.2

%

 

 

0.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Metro Boston, MA:

 

 

 

 

 

 

 

 

 

Properties

 

36

 

36

 

36

 

36

 

Total sq. ft.

 

2,738

 

2,738

 

2,738

 

2,738

 

Percent leased (3)

 

95.9

%

96.8

%

95.9

%

96.8

%

Rental income (4)

 

$

15,347

 

$

14,996

 

$

30,648

 

$

30,028

 

Property net operating income (NOI) (5)

 

$

9,852

 

$

10,032

 

$

19,843

 

$

20,004

 

NOI % growth

 

-1.8

%

 

 

-0.8

%

 

 

 

 

 

 

 

 

 

 

 

 

Southern California:

 

 

 

 

 

 

 

 

 

Properties

 

24

 

24

 

24

 

24

 

Total sq. ft.

 

1,444

 

1,444

 

1,444

 

1,444

 

Percent leased (3)

 

95.4

%

97.9

%

95.4

%

97.9

%

Rental income (4)

 

$

12,507

 

$

11,879

 

$

24,998

 

$

23,804

 

Property net operating income (NOI) (5)

 

$

9,030

 

$

8,173

 

$

18,275

 

$

16,562

 

NOI % growth

 

10.5

%

 

 

10.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Metro Austin, TX:

 

 

 

 

 

 

 

 

 

Properties

 

26

 

26

 

26

 

26

 

Total sq. ft.

 

2,727

 

2,727

 

2,727

 

2,727

 

Percent leased (3)

 

88.4

%

92.2

%

88.4

%

92.2

%

Rental income (4)

 

$

10,663

 

$

10,862

 

$

21,774

 

$

20,953

 

Property net operating income (NOI) (5)

 

$

5,177

 

$

5,469

 

$

10,939

 

$

10,610

 

NOI % growth

 

-5.3

%

 

 

3.1

%

 

 

 

 

 

 

 

 

 

 

 

 

Other Markets:

 

 

 

 

 

 

 

 

 

Properties

 

292

 

292

 

257

 

257

 

Total sq. ft.

 

23,850

 

23,850

 

22,020

 

22,020

 

Percent leased (3)

 

89.5

%

90.5

%

89.6

%

90.5

%

Rental income (4)

 

$

91,648

 

$

91,932

 

$

169,404

 

$

168,599

 

Property net operating income (NOI) (5)

 

$

53,820

 

$

55,044

 

$

100,062

 

$

101,945

 

NOI % growth

 

-2.2

%

 

 

-1.8

%

 

 

 

 

 

 

 

 

 

 

 

 

Total:

 

 

 

 

 

 

 

 

 

Properties

 

474

 

474

 

437

 

437

 

Total sq. ft.

 

56,654

 

56,654

 

54,824

 

54,824

 

Percent leased (3)

 

92.5

%

93.6

%

92.7

%

93.7

%

Rental income (4)

 

$

197,582

 

$

195,915

 

$

380,152

 

$

375,298

 

Property net operating income (NOI) (5)

 

$

119,439

 

$

120,596

 

$

231,282

 

$

231,701

 

NOI % growth

 

-1.0

%

 

 

-0.2

%

 

 


(1)   Based on properties owned continuously since 4/1/2006 and excludes properties classified in discontinued operations.

(2)   Based on properties owned continuously since 1/1/2006 and excludes properties classified in discontinued operations.

(3)          Percent leased includes (i) space being fitted out for occupancy pursuant to signed leases and (ii) space which is leased, but is not occupied or is being offered for sublease by tenants.

(4)   Includes some triple net lease rental income.

(5)          Property net operating income, or NOI, is defined as property rental income less property operating expenses; see page 14 for calculation of NOI and reconciliation of NOI to Net Income Available for Common Shareholders.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes properties located in Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

20




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

DEBT SUMMARY

(dollars in thousands)

 

 

Coupon

 

Interest

 

Principal

 

Maturity

 

Due at

 

Years to

 

 

 

Rate

 

Rate (1)

 

Balance

 

Date

 

Maturity

 

Maturity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Secured Fixed Rate Debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Secured debt  Six properties in Minneapolis, MN

 

7.020

%

7.020

%

$

15,904

 

2/1/2008

 

$

15,724

 

0.6

 

Secured debt  Two properties in Richland, WA

 

8.000

%

8.000

%

2,745

 

11/15/2008

 

1,004

 

1.4

 

Secured debt  One property in Buffalo, NY

 

5.170

%

5.170

%

2,454

 

1/1/2009

 

134

 

1.5

 

Secured debt  See note (2)

 

6.814

%

7.842

%

240,621

 

1/31/2011

 

225,547

 

3.6

 

Secured debt  One property in Bannockburn, IL

 

8.050

%

5.240

%

24,986

 

6/1/2012

 

22,719

 

4.9

 

Secured debt  Two properties in Rochester, NY

 

6.000

%

6.000

%

5,286

 

10/11/2012

 

4,507

 

5.3

 

Secured debt  One property in Macon, GA

 

4.950

%

6.280

%

13,832

 

5/11/2014

 

11,930

 

6.9

 

Secured debt  One property in Birmingham, AL

 

7.360

%

5.610

%

13,477

 

8/1/2016

 

9,281

 

9.1

 

Secured debt  One property in Syracuse, NY

 

7.310

%

6.030

%

4,420

 

1/1/2022

 

 

14.5

 

Secured debt  One property in Syracuse, NY

 

7.850

%

6.030

%

2,151

 

1/1/2022

 

 

14.5

 

Secured debt  One property in North Haven, CT

 

6.750

%

5.240

%

5,105

 

3/1/2022

 

 

14.7

 

Secured debt  One property in East Windsor, CT (3)

 

5.710

%

5.240

%

9,460

 

3/1/2026

 

 

18.7

 

Secured debt  23 properties in Atlanta, GA (4)

 

8.500

%

5.070

%

28,809

 

4/11/2028

 

4,937

 

20.8

 

Secured debt  One property in Philadelphia, PA (5)

 

6.794

%

7.383

%

41,574

 

1/1/2029

 

2,478

 

21.5

 

Total / weighted average secured fixed rate debt

 

6.941

%

7.125

%

$

410,824

 

 

 

$

298,261

 

7.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured Debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured Floating Rate Debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

Revolving credit facility (LIBOR + 55 bps) (6)

 

5.906

%

5.906

%

$

212,000

 

8/22/2010

 

$

212,000

 

3.1

 

Senior notes due 2011 (3-MONTH LIBOR + 60 bps) (7)

 

5.955

%

5.955

%

200,000

 

3/16/2011

 

200,000

 

3.7

 

Total / weighted average unsecured floating rate debt

 

5.930

%

5.930

%

$

412,000

 

 

 

$

412,000

 

3.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured Fixed Rate Debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

Senior notes due 2010

 

8.875

%

9.000

%

$

30,000

 

8/1/2010

 

$

30,000

 

3.1

 

Senior notes due 2010

 

8.625

%

8.770

%

20,000

 

10/1/2010

 

20,000

 

3.3

 

Senior notes due 2012

 

6.950

%

7.179

%

200,000

 

4/1/2012

 

200,000

 

4.8

 

Senior notes due 2013

 

6.500

%

6.693

%

200,000

 

1/15/2013

 

200,000

 

5.6

 

Senior notes due 2014

 

5.750

%

5.828

%

250,000

 

2/15/2014

 

250,000

 

6.6

 

Senior notes due 2015

 

6.400

%

6.601

%

200,000

 

2/15/2015

 

200,000

 

7.6

 

Senior notes due 2015

 

5.750

%

5.790

%

250,000

 

11/1/2015

 

250,000

 

8.3

 

Senior notes due 2016

 

6.250

%

6.470

%

400,000

 

8/15/2016

 

400,000

 

9.1

 

Senior notes due 2017

 

6.250

%

6.279

%

250,000

 

6/15/2017

 

250,000

 

10.0

 

Total / weighted average unsecured fixed rate debt

 

6.303

%

6.446

%

$

1,800,000

 

 

 

$

1,800,000

 

7.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total / weighted average unsecured debt

 

6.234

%

6.350

%

$

2,212,000

 

 

 

$

2,212,000

 

6.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total / weighted average debt

 

6.345

%

6.471

%

$

2,622,824

 

 

 

$

2,510,261

 

6.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary Debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

Total / weighted average secured fixed rate debt

 

6.941

%

7.125

%

$

410,824

 

 

 

$

298,261

 

7.5

 

Total / weighted average unsecured floating rate debt

 

5.930

%

5.930

%

412,000

 

 

 

412,000

 

3.4

 

Total / weighted average unsecured fixed rate debt

 

6.303

%

6.446

%

1,800,000

 

 

 

1,800,000

 

7.6

 

Total / weighted average debt

 

6.345

%

6.471

%

$

2,622,824

(8)

 

 

$

2,510,261

 

6.9

 

 


(1)          Includes the effect of interest rate protection, mark-to-market accounting for certain assumed mortgages, and discounts on certain mortgages and unsecured notes. Excludes effects of offering and transaction costs.

(2)          Eight properties in Austin, TX, one property in Philadelphia, PA, two properties in Los Angeles, CA and two properties in Washington, DC.

(3)   The loan becomes prepayable on 2/7/2016.

(4)          The loan becomes prepayable on 1/11/2008.  On 4/11/2008, the interest rate increases to at least 13.5% and the loan becomes subject to accelerated amortization.  We currently intend to prepay this loan in 2008.

(5)          The loan becomes prepayable on 1/31/2011.  On 1/31/2011, the interest rate increases to 8.794% and the loan becomes subject to accelerated amortization.  We currently intend to prepay this loan in 2011.

(6)          Interest rate is weighted average based on amounts outstanding during 2007.  Interest rate on amounts outstanding at 6/30/07 is 5.9%.

(7)          The notes became prepayable, at par, on September 16, 2006.  Interest rate is weighted average based on amounts outstanding during 2007.  Interest rate on amounts outstanding at 6/30/07, is 6.0%.

(8)   Total debt as of 6/30/2007, net of unamortized premiums and discounts, equals $2,614,133.

21




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

DEBT MATURITY SCHEDULE

(dollars in thousands)

 

 

Scheduled Principal Payments During Period

 

 

 

Year

 

Secured
Fixed Rate
Debt

 

Unsecured 
Floating 
Rate Debt

 

Unsecured
Fixed
Rate Debt

 

Total (1)

 

Weighted
Average
Interest Rate

 

2007

 

$

5,182

 

$

 

$

 

$

5,182

 

6.8

%

2008

 

26,369

 

 

 

26,369

 

7.0

%

2009

 

7,878

 

 

 

7,878

 

6.9

%

2010

 

8,303

 

212,000

 

50,000

 

270,303

 

6.5

%

2011

 

229,905

 

200,000

 

 

429,905

 

6.4

%

2012

 

31,113

 

 

200,000

 

231,113

 

7.0

%

2013

 

3,804

 

 

200,000

 

203,804

 

6.5

%

2014

 

15,789

 

 

250,000

 

265,789

 

5.7

%

2015

 

4,029

 

 

450,000

 

454,029

 

6.0

%

2016

 

13,387

 

 

400,000

 

413,387

 

6.3

%

2017 and thereafter

 

65,065

 

 

250,000

 

315,065

 

6.5

%

Total

 

$

410,824

 

$

412,000

 

$

1,800,000

 

$

2,622,824

 

6.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Percent

 

15.7

%

15.7

%

68.6

%

100.0

%

 

 

 


(1)   Total debt as of 6/30/2007, net of unamortized premiums and discounts, equals $2,614,133.

22




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

LEVERAGE RATIOS, COVERAGE RATIOS AND PUBLIC DEBT COVENANTS

 

 

As of and For the Three Months Ended

 

 

 

6/30/2007

 

3/31/2007

 

12/31/2006

 

9/30/2006

 

6/30/2006

 

Leverage Ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total debt / total assets

 

45.5

%

44.3

%

43.0

%

48.4

%

48.0

%

Total debt / gross book value of real estate assets (1)

 

42.2

%

41.5

%

40.2

%

45.7

%

45.4

%

Total debt / total market capitalization

 

46.4

%

42.0

%

40.9

%

47.0

%

47.5

%

Total debt / total book capitalization

 

46.9

%

45.6

%

44.8

%

50.0

%

49.5

%

Secured debt / total assets

 

7.1

%

7.3

%

7.5

%

7.1

%

7.2

%

Variable rate debt / total debt

 

15.8

%

21.8

%

18.4

%

26.9

%

26.0

%

Variable rate debt / total assets

 

7.2

%

9.7

%

7.9

%

13.0

%

12.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Coverage Ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA / interest expense

 

2.8

x

2.9

x

2.9

x

2.7

x

2.7

x

EBITDA / interest expense + preferred distributions

 

2.1

x

2.1

x

2.1

x

2.2

x

2.2

x

 

 

 

 

 

 

 

 

 

 

 

 

Public Debt Covenants (2):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt / adjusted total assets (maximum 60%)

 

41.3

%

40.4

%

39.4

%

44.5

%

44.4

%

Secured debt / adjusted total assets (maximum 40%)

 

6.5

%

6.7

%

6.8

%

6.6

%

6.6

%

Consolidated income available for debt service / debt service (minimum 1.5x)

 

2.9

x

2.9

x

3.1

x

2.8

x

2.9

x

Total unencumbered assets / unsecured debt (minimum 150% / 200%)

 

244.6

%

251.3

%

259.1

%

223.6

%

224.8

%

 


(1)          Gross book value of real estate assets is real estate properties, at cost, including purchase price allocations less impairment writedowns, if any.

(2)          Adjusted total assets and unencumbered assets includes original cost of real estate assets and excludes depreciation and amortization, accounts receivable and other intangible assets.  Consolidated income available for debt service is earnings from operations excluding interest expense, depreciation and amortization, taxes, and gains and losses on sales of assets, determined together with debt service on a pro forma basis for the four consecutive fiscal quarters most recently ended.

23




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

TENANT IMPROVEMENTS, LEASING COSTS AND CAPITAL IMPROVEMENTS

(dollars and sq. ft. in thousands, except per sq. ft. data)

 

 

For the Three Months Ended

 

 

 

6/30/2007

 

3/31/2007

 

12/31/2006

 

9/30/2006

 

6/30/2006

 

Tenant improvements (TI)

 

$

16,015

 

$

12,629

 

$

21,830

 

$

13,032

 

$

14,641

 

Leasing costs (LC)

 

7,167

 

4,253

 

5,433

 

5,339

 

9,692

 

Total TI and LC

 

23,182

 

16,882

 

27,263

 

18,371

 

24,333

 

 

 

 

 

 

 

 

 

 

 

 

 

Recurring building improvements (1)

 

3,089

 

1,592

 

9,686

 

5,573

 

5,293

 

Development, redevelopment and other activities (2)

 

15,883

 

7,302

 

8,544

 

8,156

 

5,781

 

Total capital improvements, including TI and LC

 

$

42,154

 

$

25,776

 

$

45,493

 

$

32,100

 

$

35,407

 

 

 

 

 

 

 

 

 

 

 

 

 

Sq. ft. beginning of period

 

60,251

 

59,865

 

58,070

 

58,029

 

56,835

 

Sq. ft. end of period

 

63,571

 

60,251

 

59,865

 

58,070

 

58,029

 

Average sq. ft. during period

 

61,911

 

60,058

 

58,968

 

58,050

 

57,432

 

 

 

 

 

 

 

 

 

 

 

 

 

Recurring building improvements per average sq. ft. during period

 

$

0.05

 

$

0.03

 

$

0.16

 

$

0.10

 

$

0.09

 

 


(1)          Building improvements generally include recurring expenditures that we believe are necessary to maintain the value of our properties.

(2)          Development, redevelopment and other activities generally include non-recurring expenditures or expenditures that we believe increase the value of our existing properties.

24




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

2007 ACQUISITIONS AND DISPOSITIONS INFORMATION

(dollars and sq. ft. in thousands, except per sq. ft. amounts)

Acquisitions:

Date
Acquired

 

Location

 

Office/
Industrial

 

Number of
Properties

 

Sq. Ft.

 

Purchase
Price (1)

 

Purchase
Price (1) /
Sq. Ft.

 

Cap
Rate (2)

 

Weighted
Average
Remaining
Lease
Term (3)

 

Percent
Leased (4)

 

Major Tenant

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Feb-07

 

Columbia, SC

 

Office

 

3

 

104

 

$

8,600

 

$

82.69

 

10.5

%

2.5

 

86.1

%

ADT Security Services, Inc.

 

Mar-07

 

Maynard, MA

 

Office

 

1

 

287

 

34,000

 

118.47

 

9.6

%

9.2

 

100.0

%

Stratus Technologies, Inc.

 

 

 

Q1 2007 Total / Weighted Average

 

 

 

4

 

391

 

42,600

 

108.95

 

9.8

%

7.4

 

96.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Apr-07

 

Various (5)

 

Industrial

 

13

 

3,126

 

117,850

 

37.70

 

8.8

%

9.3

 

100.0

%

Briggs & Stratton Power Products Group, LLC

 

May-07

 

Aurora, IL

 

Office

 

1

 

75

 

17,100

 

228.00

 

8.6

%

12.9

 

100.0

%

Robert Morris College

 

May-07

 

Fountain Inn, SC

 

Industrial

 

1

 

168

 

7,625

 

45.39

 

8.4

%

4.6

 

100.0

%

Caterpillar, Inc.

 

 

 

Q2 2007 Total / Weighted Average

 

 

 

15

 

3,369

 

142,575

 

42.32

 

8.7

%

9.5

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total / Weighted Average

 

 

 

19

 

3,760

 

$

185,175

 

$

49.25

 

9.0

%

8.9

 

99.6

%

 

 

 

Dispositions:

Date
Sold

 

Location

 

Office/
Industrial

 

Number of
Properties

 

Sq. Ft.

 

Sale
Price (1)

 

Original
Purchase
Price (1)

 

Sale
Price (1) /
Sq. Ft.

 

Original
Purchase
Price (1) /
Sq. Ft.

 

Sale Price
Multiple
of Original
Purchase
Price

 

Book 
Gain
on Sale

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

There were no dispositions during the six months ended June 30, 2007.


(1)   Represents the gross contract purchase or sale price and excludes closing costs and purchase price allocations.

(2)          Represents the ratio of the estimated current GAAP based annual rental income less property operating expenses to the Purchase Price.

(3)   Average remaining lease term based on rental income as of the date acquired.

(4)   Percent leased as of the date acquired.

(5)          Properties are located in Russellville, AR, Adairsville, GA, Eldridge, IA, Aurora, IL, Scottsburg, IN, Wichita, KS, Sanford, NC, Cleveland and Miamisburg, OH, Graniteville and Columbia, SC and Jefferson, WI.

25




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

2007 FINANCING ACTIVITIES

(amounts in thousands)

 

 

For the Three
Months Ended
6/30/2007

 

For the Three
Months Ended
3/31/2007

 

 

 

 

 

 

 

Debt Transactions (1):

 

 

 

 

 

New debt raised

 

$

250,000

 

$

 

New debt assumed as part of acquisitions

 

$

 

$

 

Total new debt

 

250,000

 

 

 

 

 

 

 

 

Debt retired

 

$

(200,000

)

$

 

Net debt

 

$

50,000

 

$

 

 

 

 

 

 

 

Equity Transactions:

 

 

 

 

 

New common shares issued

 

875

 

1,005

 

New common equity raised, net

 

$

10,663

 

$

12,998

 

 

 

 

 

 

 

New preferred shares issued

 

 

 

New preferred equity raised, net

 

$

 

$

 

Total new equity

 

$

10,663

 

$

12,998

 

 

 

 

 

 

 

Preferred equity retired

 

$

 

$

 

Net equity

 

$

10,663

 

$

12,998

 

 


(1)   Excludes drawings and repayments on our revolving credit facility.

26




PORTFOLIO AND LEASING INFORMATION




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

PORTFOLIO SUMMARY BY PROPERTY TYPE, TENANT AND MAJOR MARKET (SQUARE FEET)

(sq. ft. in thousands)

 

 

Metro

 

 

 

Metro

 

Metro

 

Southern

 

Metro

 

Other

 

 

 

 

 

Philadelphia, PA

 

Oahu, HI

 

Washington, DC

 

Boston, MA

 

California

 

Austin, TX

 

Markets

 

Total

 

Square Feet:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

5,444

 

 

2,658

 

3,026

 

1,444

 

1,491

 

20,949

 

35,012

 

Industrial

 

 

17,914

 

 

 

 

1,236

 

9,409

 

28,559

 

Total

 

5,444

 

17,914

 

2,658

 

3,026

 

1,444

 

2,727

 

30,358

 

63,571

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

4,591

 

158

 

892

 

523

 

331

 

186

 

4,801

 

11,482

 

Suburban

 

853

 

17,756

 

1,766

 

2,503

 

1,113

 

2,541

 

25,557

 

52,089

 

Total

 

5,444

 

17,914

 

2,658

 

3,026

 

1,444

 

2,727

 

30,358

 

63,571

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and other government tenants (1)

 

11

 

 

1,232

 

211

 

509

 

15

 

3,531

 

5,509

 

Medical related tenants (1)

 

1,075

 

 

353

 

1,047

 

579

 

395

 

3,317

 

6,766

 

Land leases (1)

 

 

16,967

 

 

 

 

 

 

16,967

 

Other investment grade tenants (1)(2)

 

1,708

 

 

59

 

816

 

36

 

36

 

6,612

 

9,267

 

Other tenants (1)

 

2,103

 

385

 

786

 

839

 

253

 

1,966

 

14,232

 

20,564

 

Vacant

 

547

 

562

 

228

 

113

 

67

 

315

 

2,666

 

4,498

 

Total

 

5,444

 

17,914

 

2,658

 

3,026

 

1,444

 

2,727

 

30,358

 

63,571

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent by Major Market:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

15

%

0

%

8

%

9

%

4

%

4

%

60

%

100

%

Industrial

 

0

%

63

%

0

%

0

%

0

%

4

%

33

%

100

%

Total

 

9

%

28

%

4

%

5

%

2

%

4

%

48

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

40

%

1

%

8

%

4

%

3

%

2

%

42

%

100

%

Suburban

 

2

%

34

%

3

%

5

%

2

%

5

%

49

%

100

%

Total

 

9

%

28

%

4

%

5

%

2

%

4

%

48

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and other government tenants

 

0

%

0

%

23

%

4

%

9

%

0

%

64

%

100

%

Medical related tenants

 

16

%

0

%

5

%

16

%

8

%

6

%

49

%

100

%

Land leases

 

0

%

100

%

0

%

0

%

0

%

0

%

0

%

100

%

Other investment grade tenants (2)

 

19

%

0

%

1

%

9

%

0

%

0

%

71

%

100

%

Other tenants

 

10

%

2

%

4

%

4

%

1

%

10

%

69

%

100

%

Vacant

 

12

%

13

%

5

%

3

%

2

%

7

%

58

%

100

%

Total

 

9

%

28

%

4

%

5

%

2

%

4

%

48

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent by Property Type and Tenant:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

100

%

0

%

100

%

100

%

100

%

55

%

69

%

55

%

Industrial

 

0

%

100

%

0

%

0

%

0

%

45

%

31

%

45

%

Total

 

100

%

100

%

100

%

100

%

100

%

100

%

100

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

84

%

1

%

34

%

17

%

23

%

7

%

16

%

18

%

Suburban

 

16

%

99

%

66

%

83

%

77

%

93

%

84

%

82

%

Total

 

100

%

100

%

100

%

100

%

100

%

100

%

100

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and other government tenants

 

0

%

0

%

46

%

7

%

35

%

1

%

11

%

9

%

Medical related tenants

 

20

%

0

%

13

%

34

%

40

%

15

%

11

%

11

%

Land leases

 

0

%

95

%

0

%

0

%

0

%

0

%

0

%

27

%

Other investment grade tenants (2)

 

31

%

0

%

2

%

27

%

2

%

0

%

22

%

14

%

Other tenants

 

39

%

2

%

30

%

28

%

18

%

72

%

47

%

32

%

Vacant

 

10

%

3

%

9

%

4

%

5

%

12

%

9

%

7

%

Total

 

100

%

100

%

100

%

100

%

100

%

100

%

100

%

100

%

 


(1)          Sq. ft. is pursuant to signed leases as of 6/30/2007, and includes (i) space being fitted out for occupancy and (ii) space which is leased, but is not occupied or is being offered for sublease.

(2)   Excludes investment grade tenants included above.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes properties located in Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

28




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

PORTFOLIO SUMMARY BY PROPERTY TYPE, TENANT AND MAJOR MARKET (ANNUALIZED RENTAL INCOME)

(dollars in thousands)

 

 

Metro

 

 

 

Metro

 

Metro

 

Southern

 

Metro

 

Other

 

 

 

 

 

Philadelphia, PA

 

Oahu, HI

 

Washington, DC

 

Boston, MA

 

California

 

Austin, TX

 

Markets

 

Total

 

Annualized Rental Income (1):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

$

127,561

 

$

-

 

$

78,513

 

$

63,996

 

$

49,230

 

$

30,432

 

$

363,343

 

$

713,075

 

Industrial

 

 

62,812

 

 

 

 

11,738

 

59,475

 

134,025

 

Total

 

$

127,561

 

$

62,812

 

$

78,513

 

$

63,996

 

$

49,230

 

$

42,170

 

$

422,818

 

$

847,100

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

$

115,739

 

$

1,166

 

$

36,524

 

$

19,414

 

$

21,234

 

$

4,982

 

$

86,853

 

$

285,912

 

Suburban

 

11,822

 

61,646

 

41,989

 

44,582

 

27,996

 

37,188

 

335,965

 

561,188

 

Total

 

$

127,561

 

$

62,812

 

$

78,513

 

$

63,996

 

$

49,230

 

$

42,170

 

$

422,818

 

$

847,100

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and other government tenants

 

$

246

 

$

 

$

38,504

 

$

5,145

 

$

10,778

 

$

237

 

$

65,105

 

$

120,015

 

Medical related tenants

 

23,170

 

 

13,244

 

23,271

 

32,000

 

10,350

 

59,593

 

161,628

 

Land leases

 

 

57,166

 

 

 

 

 

 

57,166

 

Other investment grade tenants (2)

 

47,131

 

 

2,003

 

15,896

 

1,016

 

899

 

113,455

 

180,400

 

Other tenants

 

57,014

 

5,646

 

24,762

 

19,684

 

5,436

 

30,684

 

184,665

 

327,891

 

Total

 

$

127,561

 

$

62,812

 

$

78,513

 

$

63,996

 

$

49,230

 

$

42,170

 

$

422,818

 

$

847,100

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent by Major Market:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

18

%

0

%

11

%

9

%

7

%

4

%

51

%

100

%

Industrial

 

0

%

47

%

0

%

0

%

0

%

9

%

44

%

100

%

Total

 

15

%

7

%

9

%

8

%

6

%

5

%

50

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

41

%

0

%

13

%

7

%

7

%

2

%

30

%

100

%

Suburban

 

2

%

11

%

7

%

8

%

5

%

7

%

60

%

100

%

Total

 

15

%

7

%

9

%

8

%

6

%

5

%

50

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and other government tenants

 

0

%

0

%

32

%

4

%

9

%

0

%

55

%

100

%

Medical related tenants

 

14

%

0

%

8

%

14

%

20

%

7

%

37

%

100

%

Land leases

 

0

%

100

%

0

%

0

%

0

%

0

%

0

%

100

%

Other investment grade tenants (2)

 

26

%

0

%

1

%

9

%

1

%

0

%

63

%

100

%

Other tenants

 

17

%

2

%

8

%

6

%

2

%

9

%

56

%

100

%

Total

 

15

%

7

%

9

%

8

%

6

%

5

%

50

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent by Property Type and Tenant:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office

 

100

%

0

%

100

%

100

%

100

%

72

%

86

%

84

%

Industrial

 

0

%

100

%

0

%

0

%

0

%

28

%

14

%

16

%

Total

 

100

%

100

%

100

%

100

%

100

%

100

%

100

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

91

%

2

%

47

%

30

%

43

%

12

%

21

%

34

%

Suburban

 

9

%

98

%

53

%

70

%

57

%

88

%

79

%

66

%

Total

 

100

%

100

%

100

%

100

%

100

%

100

%

100

%

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government and other government tenants

 

0

%

0

%

49

%

8

%

22

%

1

%

15

%

14

%

Medical related tenants

 

18

%

0

%

17

%

36

%

65

%

24

%

14

%

19

%

Land leases

 

0

%

91

%

0

%

0

%

0

%

0

%

0

%

7

%

Other investment grade tenants (2)

 

37

%

0

%

3

%

25

%

2

%

2

%

27

%

21

%

Other tenants

 

45

%

9

%

31

%

31

%

11

%

73

%

44

%

39

%

Total

 

100

%

100

%

100

%

100

%

100

%

100

%

100

%

100

%

 


(1)          Annualized rental income is rents pursuant to signed leases as of 6/30/2007, plus expense reimbursements; includes some triple net lease rents and excludes lease value amortization.

(2)   Excludes investment grade tenants included above.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes properties located in Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

29




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

SUMMARY OF PROPERTIES BY MAJOR MARKET

(dollars and sq. ft. in thousands)

 

As of 6/30/2007

 

Annualized

 

% of Annualized

 

Market

 

Properties

 

Sq. Ft.

 

% Sq. Ft.

 

Rental Income (1)

 

Rental Income (1)

 

Metro Philadelphia, PA

 

21

 

5,444

 

8.5

%

$

127,561

 

15.1

%

Oahu, HI

 

57

 

17,914

 

28.2

%

62,812

 

7.4

%

Metro Washington, DC

 

20

 

2,658

 

4.2

%

78,513

 

9.3

%

Metro Boston, MA

 

37

 

3,026

 

4.8

%

63,996

 

7.6

%

Southern California

 

24

 

1,444

 

2.3

%

49,230

 

5.8

%

Metro Austin, TX

 

26

 

2,727

 

4.3

%

42,170

 

5.0

%

Other markets

 

339

 

30,358

 

47.7

%

422,818

 

49.8

%

Total

 

524

 

63,571

 

100.0

%

$

847,100

 

100.0

%

 

 

 

Percent NOI For the Three Months Ended (2)

 

 

 

6/30/2007

 

3/31/2007

 

12/31/2006

 

9/30/2006

 

6/30/2006

 

Metro Philadelphia, PA

 

12.7

%

12.8

%

13.8

%

13.9

%

14.1

%

Oahu, HI

 

9.9

%

9.8

%

10.1

%

10.9

%

10.2

%

Metro Washington, DC

 

9.6

%

9.9

%

10.7

%

10.1

%

10.1

%

Metro Boston, MA

 

8.3

%

8.0

%

7.8

%

8.1

%

8.2

%

Southern California

 

7.0

%

7.4

%

6.9

%

7.0

%

6.7

%

Metro Austin, TX

 

4.0

%

4.6

%

4.7

%

4.2

%

4.5

%

Other markets

 

48.5

%

47.5

%

46.0

%

45.8

%

46.2

%

Total

 

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

 


(1)          Annualized rental income is rents pursuant to signed leases as of 6/30/2007, plus expense reimbursements; includes some triple net lease rents and excludes lease value amortization.

(2)          NOI, property net operating income, is defined as property rental income less property operating expenses; see page 14 for calculation of NOI and reconciliation of NOI to Net Income Available for Common Shareholders.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes properties located in Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

30




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

LEASING SUMMARY

(dollars and sq. ft. in thousands, except per sq. ft. data)

 

 

As of and For the Three Months Ended (1)

 

 

 

6/30/2007

 

3/31/2007

 

12/31/2006

 

9/30/2006

 

6/30/2006

 

Properties

 

524

 

508

 

504

 

487

 

487

 

Total sq. ft. (2)

 

63,571

 

60,251

 

59,865

 

58,070

 

58,029

 

Percentage leased

 

92.9

%

92.8

%

93.1

%

93.4

%

93.6

%

 

 

 

 

 

 

 

 

 

 

 

 

Leasing Activity (sq. ft.):

 

 

 

 

 

 

 

 

 

 

 

New leases

 

814

 

410

 

453

 

642

 

629

 

Renewals

 

1,107

 

654

 

421

 

766

 

1,343

 

Total

 

1,921

 

1,064

 

874

 

1,408

 

1,972

 

 

 

 

 

 

 

 

 

 

 

 

 

% Change in GAAP Rent (3):

 

 

 

 

 

 

 

 

 

 

 

New leases

 

8

%

-1

%

24

%

19

%

8

%

Renewals

 

0

%

3

%

-3

%

1

%

3

%

Weighted average

 

3

%

1

%

9

%

9

%

5

%

 

 

 

 

 

 

 

 

 

 

 

 

Capital Commitments (4):

 

 

 

 

 

 

 

 

 

 

 

New leases

 

$

24,074

 

$

12,726

 

$

7,912

 

$

20,473

 

$

10,975

 

Renewals

 

10,936

 

5,184

 

3,527

 

5,205

 

15,116

 

Total

 

$

35,010

 

$

17,910

 

$

11,439

 

$

25,678

 

$

26,091

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Commitments per Sq. Ft. (4):

 

 

 

 

 

 

 

 

 

 

 

New leases

 

$

29.57

 

$

31.04

 

$

17.47

 

$

31.89

 

$

17.45

 

Renewals

 

$

9.88

 

$

7.93

 

$

8.38

 

$

6.80

 

$

11.26

 

Total

 

$

18.22

 

$

16.83

 

$

13.09

 

$

18.24

 

$

13.23

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Lease Term by Sq. Ft. (years):

 

 

 

 

 

 

 

 

 

 

 

New leases

 

8.2

 

8.1

 

5.0

 

7.6

 

6.2

 

Renewals

 

7.7

 

5.8

 

4.7

 

5.0

 

8.9

 

Total

 

7.9

 

6.6

 

4.8

 

6.3

 

8.0

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Commitments per Sq. Ft. per Year:

 

 

 

 

 

 

 

 

 

 

 

New leases

 

$

3.61

 

$

3.83

 

$

3.49

 

$

4.20

 

$

2.81

 

Renewals

 

$

1.28

 

$

1.37

 

$

1.78

 

$

1.36

 

$

1.26

 

Total

 

$

2.31

 

$

2.55

 

$

2.73

 

$

2.89

 

$

1.65

 

 


(1)  Results exclude properties classified in discontinued operations.

(2)  Sq. ft. measurements are subject to modest changes when space is re-measured or re-configured for new tenants.

(3)  Percent difference in prior rents charged for same space.  Rents include expense reimbursements and exclude lease value amortization.

(4)  Represents commitments to tenant improvements (TI) and leasing costs (LC).

The above leasing summary is based on leases executed during the periods indicated.

31




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

OCCUPANCY AND LEASING ANALYSIS BY PROPERTY TYPE AND MAJOR MARKET (3 MONTHS ENDED 6/30/2007)

(dollars and sq. ft. in thousands)

 

 

 

Sq. Ft. Leases Executed During
Three Months Ended 6/30/2007

 

Property Type/Market

 

Total Sq. Ft.
As of
6/30/07

 

New

 

Renewals

 

Total

 

 

 

 

 

 

 

 

 

 

 

Office

 

35,012

 

681

 

1,028

 

1,709

 

Industrial

 

28,559

 

133

 

79

 

212

 

Total

 

63,571

 

814

 

1,107

 

1,921

 

 

 

 

 

 

 

 

 

 

 

CBD

 

11,482

 

239

 

404

 

643

 

Suburban

 

52,089

 

575

 

703

 

1,278

 

Total

 

63,571

 

814

 

1,107

 

1,921

 

 

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

5,444

 

185

 

18

 

203

 

Oahu, HI

 

17,914

 

3

 

4

 

7

 

Metro Washington, DC

 

2,658

 

117

 

109

 

226

 

Metro Boston, MA

 

3,026

 

5

 

 

5

 

Southern California

 

1,444

 

60

 

46

 

106

 

Metro Austin, TX

 

2,727

 

143

 

47

 

190

 

Other markets

 

30,358

 

301

 

883

 

1,184

 

Total

 

63,571

 

814

 

1,107

 

1,921

 

 

 

 

Sq. Ft. Leased

 

 

 

As of

 

3/31/2007

 

 

 

New and

 

Acquisitions /

 

As of

 

6/30/07

 

 

 

3/31/2007

 

% Leased (1)

 

Expired

 

Renewals

 

(Sales)

 

6/30/07

 

% Leased

 

Office

 

31,454

 

90.0

%

(1,590

)

1,709

 

75

 

31,648

 

90.4

%

Industrial

 

24,439

 

96.6

%

(519

)

212

 

3,294

 

27,426

 

96.0

%

Total

 

55,893

 

92.8

%

(2,109

)

1,921

 

3,369

 

59,074

 

92.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

10,315

 

89.8

%

(559

)

643

 

 

10,399

 

90.6

%

Suburban

 

45,578

 

93.5

%

(1,550

)

1,278

 

3,369

 

48,675

 

93.5

%

Total

 

55,893

 

92.8

%

(2,109

)

1,921

 

3,369

 

59,074

 

92.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

4,836

 

88.8

%

(141

)

203

 

 

4,898

 

90.0

%

Oahu, HI

 

17,398

 

97.3

%

(53

)

7

 

 

17,352

 

96.9

%

Metro Washington, DC

 

2,415

 

90.8

%

(211

)

226

 

 

2,430

 

91.4

%

Metro Boston, MA

 

2,910

 

96.1

%

(2

)

5

 

 

2,913

 

96.3

%

Southern California

 

1,410

 

97.7

%

(139

)

106

 

 

1,377

 

95.4

%

Metro Austin, TX

 

2,642

 

94.1

%

(420

)

190

 

 

2,412

 

88.4

%

Other markets

 

24,282

 

90.0

%

(1,143

)

1,184

 

3,369

 

27,692

 

91.2

%

Total

 

55,893

 

92.8

%

(2,109

)

1,921

 

3,369

 

59,074

 

92.9

%

 


(1)  Based on total sq. ft. as of March 31, 2007; excludes acquisitions and effects of space remeasurements during the period.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

32




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

OCCUPANCY AND LEASING ANALYSIS BY PROPERTY TYPE AND MAJOR MARKET (6 MONTHS ENDED 6/30/2007)

 (dollars and sq. ft. in thousands)

 

 

 

Sq. Ft. Leases Executed During
Six Months Ended 6/30/2007

 

Property Type/Market

 

Total Sq. Ft.
As of
6/30/07

 

New

 

Renewals

 

Total

 

 

 

 

 

 

 

 

 

 

 

Office

 

35,012

 

1,060

 

1,628

 

2,688

 

Industrial

 

28,559

 

164

 

133

 

297

 

Total

 

63,571

 

1,224

 

1,761

 

2,985

 

 

 

 

 

 

 

 

 

 

 

CBD

 

11,482

 

370

 

599

 

969

 

Suburban

 

52,089

 

854

 

1,162

 

2,016

 

Total

 

63,571

 

1,224

 

1,761

 

2,985

 

 

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

5,444

 

280

 

101

 

381

 

Oahu, HI

 

17,914

 

4

 

11

 

15

 

Metro Washington, DC

 

2,658

 

130

 

111

 

241

 

Metro Boston, MA

 

3,026

 

15

 

6

 

21

 

Southern California

 

1,444

 

64

 

157

 

221

 

Metro Austin, TX

 

2,727

 

172

 

98

 

270

 

Other markets

 

30,358

 

559

 

1,277

 

1,836

 

Total

 

63,571

 

1,224

 

1,761

 

2,985

 

 

 

 

Sq. Ft. Leased

 

 

 

As of

 

12/31/06

 

 

 

New and

 

Acquisitions /

 

As of

 

6/30/07

 

 

 

12/31/2006

 

% Leased (1)

 

Expired

 

Renewals

 

(Sales)

 

6/30/07

 

% Leased

 

Office

 

31,277

 

90.5

%

(2,749

)

2,688

 

452

 

31,668

 

90.4

%

Industrial

 

24,442

 

96.6

%

(627

)

297

 

3,294

 

27,406

 

96.0

%

Total

 

55,719

 

93.1

%

(3,376

)

2,985

 

3,746

 

59,074

 

92.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CBD

 

10,365

 

90.2

%

(935

)

969

 

 

10,399

 

90.6

%

Suburban

 

45,354

 

93.8

%

(2,441

)

2,016

 

3,746

 

48,675

 

93.5

%

Total

 

55,719

 

93.1

%

(3,376

)

2,985

 

3,746

 

59,074

 

92.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Metro Philadelphia, PA

 

4,920

 

90.2

%

(403

)

381

 

 

4,898

 

90.0

%

Oahu, HI

 

17,398

 

97.3

%

(61

)

15

 

 

17,352

 

96.9

%

Metro Washington, DC

 

2,546

 

95.8

%

(357

)

241

 

 

2,430

 

91.4

%

Metro Boston, MA

 

2,645

 

96.5

%

(40

)

21

 

287

 

2,913

 

96.3

%

Southern California

 

1,411

 

97.7

%

(255

)

221

 

 

1,377

 

95.4

%

Metro Austin, TX

 

2,644

 

94.2

%

(502

)

270

 

 

2,412

 

88.4

%

Other markets

 

24,155

 

89.9

%

(1,758

)

1,836

 

3,459

 

27,692

 

91.2

%

Total

 

55,719

 

93.1

%

(3,376

)

2,985

 

3,746

 

59,074

 

92.9

%

 


(1)  Based on total sq. ft. as of December 31, 2006; excludes acquisitions and effects of space remeasurements during the period.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

33




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

TENANTS REPRESENTING 1% OR MORE OF TOTAL RENT

(sq. ft. in thousands)

 

 

 

 

% of Total

 

% of Rental

 

 

 

Tenant

 

Sq. Ft. (1)

 

Sq. Ft. (1)

 

Income (2)

 

Expiration

 

1  U.S. Government

 

4,826

 

8.2

%

12.8

%

2007 to 2020

 

2  GlaxoSmithKline plc

 

608

 

1.0

%

1.7

%

2013

 

3  PNC Financial Services Group

 

460

 

0.8

%

1.4

%

2011, 2021

 

4  Solectron Corporation

 

894

 

1.5

%

1.1

%

2014

 

5  JDA Software Group, Inc.

 

283

 

0.5

%

1.1

%

2012

 

6  The Scripps Research Institute

 

164

 

0.3

%

1.1

%

2019

 

7  Ballard Spahr Andrews & Ingersoll, LLP

 

235

 

0.4

%

1.0

%

2008, 2015

 

Total

 

7,470

 

12.7

%

20.2

%

 

 

 


(1)  Sq. ft. is pursuant to signed leases as of 6/30/2007, and includes (i) space being fitted out for occupancy and (ii) space which is leased, but is not occupied or is being offered for sublease.

(2)  Rental income is rents pursuant to signed leases as of 6/30/2007, plus expense reimbursements; includes some triple net lease rents and excludes lease value amortization.

34




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

THREE YEAR LEASE EXPIRATION SCHEDULE BY PROPERTY TYPE

 (dollars and sq. ft. in thousands)

 

 

Total as of
6/30/2007

 

2007

 

2008

 

2009

 

2010 and
Thereafter

 

 

 

 

 

 

 

 

 

 

 

 

 

Office:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

35,012

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

31,648

 

1,557

 

3,376

 

2,792

 

23,923

 

Percent

 

100.0

%

4.9

%

10.7

%

8.8

%

75.6

%

Annualized rental income (2)

 

$

713,075

 

$

32,729

 

$

73,697

 

$

61,550

 

$

545,099

 

Percent

 

100.0

%

4.6

%

10.3

%

8.6

%

76.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Industrial:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

28,559

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

27,426

 

631

 

1,278

 

989

 

24,528

 

Percent

 

100.0

%

2.3

%

4.7

%

3.6

%

89.4

%

Annualized rental income (2)

 

$

134,025

 

$

2,601

 

$

7,686

 

$

6,360

 

$

117,378

 

Percent

 

100.0

%

1.9

%

5.7

%

4.7

%

87.7

%

 

 

 

 

 

 

 

 

 

 

 

 

CBD:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

11,482

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

10,399

 

553

 

1,092

 

719

 

8,035

 

Percent

 

100.0

%

5.3

%

10.5

%

6.9

%

77.3

%

Annualized rental income (2)

 

$

285,912

 

$

13,243

 

$

26,891

 

$

22,099

 

$

223,679

 

Percent

 

100.0

%

4.6

%

9.4

%

7.7

%

78.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Suburban:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

52,089

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

48,675

 

1,635

 

3,562

 

3,062

 

40,416

 

Percent

 

100.0

%

3.4

%

7.3

%

6.3

%

83.0

%

Annualized rental income (2)

 

$

561,188

 

$

22,087

 

$

54,492

 

$

45,811

 

$

438,798

 

Percent

 

100.0

%

3.9

%

9.7

%

8.2

%

78.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Total:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

63,571

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

59,074

 

2,188

 

4,654

 

3,781

 

48,451

 

Percent

 

100.0

%

3.7

%

7.9

%

6.4

%

82.0

%

Annualized rental income (2)

 

$

847,100

 

$

35,330

 

$

81,383

 

$

67,910

 

$

662,477

 

Percent

 

100.0

%

4.2

%

9.6

%

8.0

%

78.2

%

 


(1)  Sq. ft. is pursuant to signed leases as of 6/30/2007, and includes (i) space being fitted out for occupancy and (ii) space which is leased, but is not occupied or is being offered for sublease.

(2)  Annualized rental income is rents pursuant to signed leases as of 6/30/2007, plus expense reimbursements; includes some triple net lease rents and excludes lease value amortization.

35




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

THREE YEAR LEASE EXPIRATION SCHEDULE BY MAJOR MARKET

(dollars and sq. ft. in thousands)

 

 

Total as of
6/30/2007

 

2007

 

2008

 

2009

 

2010 and
Thereafter

 

Metro Philadelphia, PA:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

5,444

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

4,898

 

27

 

484

 

273

 

4,114

 

Percent

 

100.0

%

0.6

%

9.9

%

5.6

%

83.9

%

Annualized rental income (2)

 

$

127,561

 

$

702

 

$

12,022

 

$

5,892

 

$

108,945

 

Percent

 

100.0

%

0.6

%

9.4

%

4.6

%

85.4

%

Oahu, HI:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

17,914

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

17,352

 

440

 

495

 

264

 

16,153

 

Percent

 

100.0

%

2.5

%

2.9

%

1.5

%

93.1

%

Annualized rental income (2)

 

$

62,812

 

$

891

 

$

2,467

 

$

1,068

 

$

58,386

 

Percent

 

100.0

%

1.4

%

3.9

%

1.7

%

93.0

%

Metro Washington, DC:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

2,658

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

2,430

 

23

 

106

 

144

 

2,157

 

Percent

 

100.0

%

0.9

%

4.4

%

5.9

%

88.8

%

Annualized rental income (2)

 

$

78,513

 

$

832

 

$

2,944

 

$

5,389

 

$

69,348

 

Percent

 

100.0

%

1.1

%

3.7

%

6.9

%

88.3

%

Metro Boston, MA:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

3,026

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

2,913

 

349

 

150

 

43

 

2,371

 

Percent

 

100.0

%

12.0

%

5.1

%

1.5

%

81.4

%

Annualized rental income (2)

 

$

63,996

 

$

7,598

 

$

4,037

 

$

1,390

 

$

50,971

 

Percent

 

100.0

%

11.9

%

6.3

%

2.2

%

79.6

%

Southern California:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

1,444

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

1,377

 

130

 

204

 

155

 

888

 

Percent

 

100.0

%

9.4

%

14.8

%

11.3

%

64.5

%

Annualized rental income (2)

 

$

49,230

 

$

3,122

 

$

6,957

 

$

6,364

 

$

32,787

 

Percent

 

100.0

%

6.3

%

14.1

%

12.9

%

66.7

%

Metro Austin, TX:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

2,727

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

2,412

 

86

 

154

 

169

 

2,003

 

Percent

 

100.0

%

3.6

%

6.4

%

7.0

%

83.0

%

Annualized rental income (2)

 

$

42,170

 

$

1,716

 

$

3,350

 

$

3,181

 

$

33,923

 

Percent

 

100.0

%

4.1

%

7.9

%

7.5

%

80.5

%

Other markets:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

30,358

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

27,692

 

1,133

 

3,061

 

2,733

 

20,765

 

Percent

 

100.0

%

4.1

%

11.1

%

9.9

%

74.9

%

Annualized rental income (2)

 

$

422,818

 

$

20,469

 

$

49,606

 

$

44,626

 

$

308,117

 

Percent

 

100.0

%

4.8

%

11.7

%

10.6

%

72.9

%

Total:

 

 

 

 

 

 

 

 

 

 

 

Total sq. ft.

 

63,571

 

 

 

 

 

 

 

 

 

Leased sq. ft. (1)

 

59,074

 

2,188

 

4,654

 

3,781

 

48,451

 

Percent

 

100.0

%

3.7

%

7.9

%

6.4

%

82.0

%

Annualized rental income (2)

 

$

847,100

 

$

35,330

 

$

81,383

 

$

67,910

 

$

662,477

 

Percent

 

100.0

%

4.2

%

9.6

%

8.0

%

78.2

%

 


(1)  Sq. ft. is pursuant to signed leases as of 6/30/2007, and includes (i) space being fitted out for occupancy and (ii) space which is leased, but is not occupied or is being offered for sublease.

(2)  Annualized rental income is rents pursuant to signed leases as of 6/30/2007, plus expense reimbursements; includes some triple net lease rents and excludes lease value amortization.

We define our major markets as markets which currently, or during either of the last two quarters, constitute 5% or more of our leaseable square feet, rental income or NOI.  Major markets are based on geographic market areas as defined by CoStar, except for the Metro Philadelphia, PA market which excludes Wilmington, DE.  Southern California includes properties located in the Los Angeles, San Diego and Orange County markets, as defined by CoStar.  Oahu, HI includes all properties located on the island of Oahu.

36




HRPT Properties Trust

Supplemental Operating and Financial Data

June 30, 2007

PORTFOLIO LEASE EXPIRATION SCHEDULE

(dollars and sq. ft. in thousands)

 

 

Sq. Ft.
Expiring (1)

 

% of Sq. Ft.
Expiring

 

Annualized
Rental
Income Expiring (2)

 

% of Annualized
Rental Income
Expiring

 

Cumulative %
of
Annualized
Rental Income
Expiring

 

2007

 

2,188

 

3.7

%

$

35,330

 

4.2

%

4.2

%

2008

 

4,654

 

7.9

%

81,383

 

9.6

%

13.8

%

2009

 

3,781

 

6.4

%

67,910

 

8.0

%

21.8

%

2010

 

6,305

 

10.7

%

97,742

 

11.5

%

33.3

%

2011

 

5,898

 

10.0

%

95,976

 

11.3

%

44.6

%

2012

 

4,809

 

8.1

%

96,562

 

11.4

%

56.0

%

2013

 

2,469

 

4.2

%

46,878

 

5.5

%

61.5

%

2014

 

2,706

 

4.6

%

46,769

 

5.5

%

67.0

%

2015

 

3,241

 

5.5

%

58,211

 

6.9

%

73.9

%

2016

 

2,476

 

4.2

%

42,082

 

5.0

%

78.9

%

2017 and thereafter

 

20,547

 

34.7

%

178,257

 

21.1

%

100.0

%

Total

 

59,074

 

100.0

%

$

847,100

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average remaining lease term (in years)

 

9.1

 

 

 

6.5

 

 

 

 

 

 


(1)  Sq. ft. is pursuant to signed leases as of 6/30/2007, and includes (i) space being fitted out for occupancy and (ii) space which is leased, but is not occupied or is being offered for sublease.

(2)  Annualized rental income is rents pursuant to signed leases as of 6/30/2007, plus expense reimbursements; includes some triple net lease rents and excludes lease value amortization.

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