-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Rurn0NpsV3FEBgnkROtcuvcy1jfF3jWqauOuvjCg0DoJeyG/wGQU6f5rkHEBtEAQ 4ewDkIJzxQSPK5ygWJ7XDg== 0001157523-03-003727.txt : 20030807 0001157523-03-003727.hdr.sgml : 20030807 20030806174450 ACCESSION NUMBER: 0001157523-03-003727 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030804 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030807 FILER: COMPANY DATA: COMPANY CONFORMED NAME: KOGER EQUITY INC CENTRAL INDEX KEY: 0000835664 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 592898045 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09997 FILM NUMBER: 03827178 BUSINESS ADDRESS: STREET 1: 8880 FREEDOM CROSSING TRAIL CITY: JACKSONVILLE STATE: FL ZIP: 32256 BUSINESS PHONE: 9047321000 MAIL ADDRESS: STREET 1: 8880 FREEDOM CROSSING TRAIL CITY: JACKSONVILLE STATE: FL ZIP: 32256 8-K 1 a4448835.txt KOGER EQUITY 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): August 4, 2003 --------------- KOGER EQUITY, INC. ------------------------------------------------------------------------------- (Exact Name of Registrant as Specified in Its Charter) FLORIDA ------------------------------------------------------------------------------- (State or Other Jurisdiction of Incorporation) 1-9997 59-2898045 ------------------------------------------------------------------------------- (Commission File Number) (IRS Employer Identification No.) 225 NE MIZNER BOULEVARD, SUITE 200 BOCA RATON, FLORIDA 33432 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) (561) 395-9666 - -------------------------------------------------------------------------------- (Registrant's Telephone Number, Including Area Code) NA ------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Reports) 1 Item 9. Regulation FD Disclosure. Koger Equity, Inc. announced its quarterly results for the period ended June 30, 2003, as more particularly described in its News Release, dated August 4, 2003, and related Supplemental Information, dated June 30, 2003, on the Company's web site, a copy of which is attached hereto as Exhibit 99(a) and by this reference made a part hereof. Koger Equity, Inc. also announced that it has signed a definitive agreement with State Teachers Retirement System of Ohio to acquire the Rosemeade Building and CIGNA Plaza in Dallas, Texas for $33.15 million in cash, as more particularly described in its News Release, dated August 4, 2003, a copy of which is attached hereto as Exhibit 99(b) and by this reference made a part hereof. For more information on Koger Equity, Inc., contact the company at 800-850-2037 or visit its Web site at www.koger.com. Item 7. Financial Statements and Exhibits. (c) Exhibits Exhibit Number Description of Exhibit 99(a) Koger Equity, Inc. News Release, dated August 4, 2003, and related Supplemental Information, dated June 30, 2003. 99(b) Koger Equity, Inc. News Release, dated August 4, 2003. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. KOGER EQUITY, INC. Dated: August 4, 2003 By: /S/ Steven A. Abney ------------------------------------ Steven A. Abney Title: Vice President/Finance and Chief Accounting Officer (Principal Financial Officer) 3 EXHIBIT INDEX The following designated exhibits are filed herewith: Exhibit Number Description of Exhibit 99(a) Koger Equity, Inc. News Release, dated August 4, 2003, and related Supplemental Information, dated June 30, 2003. 99(b) Koger Equity, Inc. News Release, dated August 4, 2003. 4 EX-99 3 a4448835ex99a.txt EXHIBIT 99(A) PRESS RELEASE Exhibit 99(a) Koger Equity Announces Second Quarter Earnings; Company Increases 2003 Guidance BOCA RATON, Fla.--(BUSINESS WIRE)--Aug. 4, 2003--Koger Equity, Inc. (NYSE:KE) today reported results for the second quarter ended June 30, 2003. Net income for the second quarter 2003 totaled $3.5 million, or $0.16 per diluted share, compared to $4.3 million, or $0.20 per diluted share, for the second quarter 2002. The decline in net income in the second quarter 2003 was due to lower occupancy levels across the Company's portfolio combined with increased interest expense, depreciation and amortization resulting from the Company's December 2002 acquisition of The Lakes on Post Oak in Houston, Texas. Operating profits from The Lakes on Post Oak acquisition somewhat offset these increased expenses. The weighted average number of common shares totaled 21,382,000 for the second quarter 2003 and 21,469,000 for the second quarter 2002 on a fully diluted basis. Funds from operations (FFO) for the second quarter 2003 totaled $11.1 million, or $0.52 per diluted share, as compared to FFO for the same period in 2002 of $11.0 million, or $0.51 per diluted share. The Company's portfolio ended the second quarter 2003 with an overall occupancy of 82.5%, up from 81.1% at March 31, 2003 and down from 86.2% at June 30, 2002. For the second quarter 2003, Koger increased total operating revenues $3.3 million to $36.1 million, from $32.8 million for the same period in 2002. The increase is due principally to the Company's December 2002 acquisition of The Lakes on Post Oak, and is somewhat offset by the decline in same-store total operating revenues of 3.7%, or $1.1 million as compared to the same period in 2002 as well as a reduction in income from third-party management fees. Occupancy on the same store portfolio consisting of 120 buildings was 85.8% at June 30, 2003, up from 83.8% at March 31, 2003 but down from 88.9% at June 30, 2002. Property operating margins declined to 59.1% for the second quarter 2003 from 62.6% for the second quarter 2002, due principally to lower occupancies and increased insurance, bad debt reserves and management costs. Thomas J. Crocker, Chief Executive Officer of Koger Equity, Inc. said, "We are pleased to report better than expected second quarter FFO results despite a very difficult environment. We may be seeing a 'bottoming out' of weak market fundamentals; however, we continue to sacrifice rental rates in order to maintain occupancy. We budgeted a significant reduction in occupancy in 2003 and so far have significantly outperformed that measure. Furthermore, we did see a slowdown in lease cancellations compared to the first quarter 2003 and we see that as a positive. Office building job growth will drive the recovery in our sector and although there are at least some positive indicators on that front we are clearly not seeing meaningful additional demand from our existing tenant base." The Company signed 272,000 square feet of leases in 81 transactions in the second quarter 2003 at an average cost of $2.20 per square foot per year. The weighted average net rental rate on leases signed, excluding first generation space was $10.90 as compared to $12.19 for the average rental rate on expiring leases, a 10.6% decrease in rental rates. For the second quarter 2003, the Company achieved positive net absorption totaling 13,000 square feet. The Company's dividend payout ratio to FFO was 67.3% and to cash available for distribution was 93.2% for the second quarter 2003. Results for the Six Months Ended June 30, 2003 Net income for the first six months of 2003 totaled $7.7 million, or $0.36 per diluted share, compared to $9.5 million, or $0.44 per diluted share for the same period in 2002. The decline was due principally to occupancy losses and to the increased interest expense, depreciation and amortization resulting from The Lakes on Post Oak acquisition, and was partially offset by operating profits from that acquisition. FFO for the first half of 2003 was $23.5 million, or $1.10 per diluted share, compared to $22.5 million, or $1.05 per diluted share for the same period in 2002. The increase is due to The Lakes on Post Oak acquisition, but is partially offset by lower occupancies across the Company's portfolio and the resulting effects on operating profits. For the first six months of 2003, Koger increased total operating revenues $8.4 million to $72.6 million, from $64.2 million for the same period in 2002. The increase is due principally to the Company's December 2002 acquisition of The Lakes on Post Oak, and is somewhat offset by the decline in same-store total operating revenues, which totaled 3.3%, or $1.9 million, as compared to the same period in 2002. Occupancy on the same store portfolio consisting of 120 buildings was 85.8% at June 30, 2003, down from 87.1% at December 31, 2002. The Company signed 680,000 square feet of leases in 159 transactions in the first six months of 2003 at an average cost of $1.84 per square foot per year. The weighted average net rental rate on leases signed, excluding first generation space was $11.61 as compared to $12.54 for the average rental rate on expiring leases, a 7.5% decrease in rental rates. For the first six months of 2003, the Company had negative net absorption totaling 95,000 square feet. Earnings Estimates Based on the current outlook, and Koger's results for the second quarter 2003, the Company is increasing its 2003 net income and FFO per diluted share guidance. Management expects 2003 net income will range between $0.62-$0.67 per diluted share while FFO is expected to range between $2.10-$2.15 per diluted share. The increase is due to certain unbudgeted items occurring in the first and second quarters of 2003, including lease cancellation fees, higher expense reimbursements, adjustments to straight-line rent, asset management fees from Crocker Realty Trust, LP, and higher leasing activity. Included in the revised forecast is $0.04 of FFO accretion from the Dallas acquisition announced today under a separate release. During the scheduled August 5, 2003 conference call, management will further discuss earnings guidance for 2003. Funds from operations (FFO) is a non-GAAP financial measure. The Company believes that Funds from Operations is one measure of the performance of an equity real estate investment trust. Funds from Operations should not be considered as an alternative to net income as an indication of the Company's financial performance or to cash flow from operating activities (determined in accordance with accounting principles generally accepted in the United States of America) as a measure of the Company's liquidity, nor is it necessarily indicative of sufficient cash flow to fund all of the Company's needs. Estimates of future FFO per share are by definition, and certain other matters discussed in this press release may be, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Koger Equity, Inc. believes the expectations reflected in such forward-looking statements are based on reasonable assumptions; there can be no assurance that its expectations will be attained. Certain factors that could cause actual results to differ materially from the Company's expectations are set forth as risk factors in the company's SEC reports and filings, including its annual report on Form 10-K. Included among these factors are changes in general economic conditions, including changes in the economic conditions affecting industries in which its principal tenants compete; its ability to timely lease or re-lease space at current or anticipated rents to creditworthy tenants; its ability to achieve economies of scale over time; the demand for tenant services beyond those traditionally provided by landlords; changes in interest rates; changes in operating costs; its ability to attract and retain high-quality personnel at a reasonable cost in a highly competitive labor environment; future demand for its debt and equity securities; its ability to refinance its debt on reasonable terms at maturity; and its ability to complete current and future development projects on schedule and on budget. Many of these factors are beyond the Company's ability to control or predict. Forward-looking statements are not guarantees of performance. For forward-looking statements contained or incorporated by reference herein, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events. Koger Equity, Inc. owns and operates 124 office buildings, containing 8.93 million rentable square feet, located primarily in 16 suburban office projects in nine cities in the Southeastern United States and Houston, Texas. Copies of the Company's June 30, 2003 Second Quarter Supplemental Disclosure package are available upon request to Investor Relations, Koger Equity, Inc., 225 NE Mizner Blvd., Suite 200, Boca Raton, Florida 33432, or call 1-800-850-2037. Additionally, the Second Quarter Supplemental Disclosure package and further information about Koger Equity, Inc. can be found on the Company's Web site at www.koger.com. KOGER EQUITY, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In Thousands except per Share Data) For the Three For the Six Months Ended Months Ended 6/30/03 6/30/02 6/30/03 6/30/02 ------- ------- ------- -------- Revenues Rental and other rental services $35,964 $31,855 $72,244 $62,450 Management fees 126 963 331 1,751 Other -- -- 5 2 ------- ------- ------- -------- Total operating revenues 36,090 32,818 72,580 64,203 ------- ------- ------- -------- Expenses Property operations 14,694 11,928 28,042 22,388 Depreciation and amortization 8,156 6,731 16,612 13,252 General and administrative 3,086 2,947 6,030 5,457 Direct cost of management fees 2 822 88 1,833 Other 31 49 67 82 ------- ------- ------- -------- Total operating expenses 25,969 22,477 50,839 43,012 ------- ------- ------- -------- Operating Income 10,121 10,341 21,741 21,191 ------- ------- ------- -------- Other Income and Expense Interest income 86 87 140 232 Mortgage and loan interest (7,367) (6,029)(14,770)(11,823) ------- ------- ------- -------- Total other income and expense (7,281) (5,942)(14,630)(11,591) ------- ------- ------- -------- Income Before Gain on Sale or Disposition of Assets, Income Taxes and Minority Interest 2,840 4,399 7,111 9,600 Gain on sale or disposition of assets 589 -- 589 1 ------- ------- ------- -------- Income Before Income Taxes and Minority Interest 3,429 4,399 7,700 9,601 Income taxes (21) 62 (21) 93 ------- ------- ------- -------- Income Before Minority Interest 3,450 4,337 7,721 9,508 Minority interest -- -- -- 20 ------- ------- ------- -------- Net Income $3,450 $4,337 $7,721 $9,488 ======= ======= ======= ======== Earnings Per Share: Basic $0.16 $0.20 $0.36 $0.45 ======= ======= ======= ======== Diluted $0.16 $0.20 $0.36 $0.44 ======= ======= ======= ======== Weighted Average Shares: Basic 21,311 21,255 21,305 21,241 ======= ======= ======= ======== Diluted 21,382 21,469 21,335 21,408 ======= ======= ======= ======== KOGER EQUITY, INC. FUNDS FROM OPERATIONS (In Thousands except per Share Data) For the Three For the Six Months Ended Months Ended 6/30/03 6/30/02 6/30/03 6/30/02 ------- ------- ------- -------- Net income $3,450 $4,337 $7,721 $9,488 Depreciation - real estate 7,390 6,277 14,581 12,319 Amortization - deferred tenant costs 432 338 828 702 Amortization - fair value of acquired leases 432 -- 924 -- Minority interest -- -- -- 20 Gain on sale or disposition: Operating properties -- -- -- -- Non-operating assets (589) -- (589) (1) ------- ------- ------- -------- Funds from operations $11,115 $10,952 $23,465 $22,528 ======= ======= ======= ======== Weighted average shares/units outstanding - diluted 21,382 21,469 21,335 21,408 Funds from operations, per diluted share/unit $0.52 $0.51 $1.10 $1.05 KOGER EQUITY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Thousands) June Dec. 30, 31, 2003 2002 ------ --------- ASSETS Real estate investments: Operating properties: Land $ 110,653 $110,653 Buildings 784,145 783,185 Furniture and equipment 3,488 3,320 Accumulated depreciation (164,470)(149,830) ------- -------- Operating properties, net 733,816 747,328 Undeveloped land held for investment 9,995 9,995 Undeveloped land held for sale, net of allowance 3,041 3,831 Cash and cash equivalents 4,741 4,627 Restricted cash 14,417 13,340 Accounts receivable, net of allowance for uncollectible accounts of $1,558 and $1,280 13,007 12,183 Cost in excess of fair value of net assets acquired, net of accumulated amortization of $683 and $683 595 595 Other assets 17,126 13,186 TOTAL ASSETS $796,738 $805,085 LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Mortgages and loans payable $426,371 $431,698 Accounts payable 2,648 3,801 Accrued real estate taxes payable 7,997 147 Other accrued liabilities 10,889 13,435 Dividends payable 7,463 7,453 Advance rents and security deposits 5,224 5,483 -------- --------- Total Liabilities 460,592 462,017 -------- --------- Shareholders' equity: Common stock 298 298 Capital in excess of par value 472,364 472,156 Notes receivable from stock sales (5,266) (5,266) Accumulated other comprehensive loss (212) (212) Retained earnings 613 7,813 Treasury stock, at cost (131,651)(131,721) -------- --------- Total Shareholders' Equity 336,146 343,068 -------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $796,738 $805,085 ======== ========= KOGER EQUITY, INC. FORECASTED FUNDS FROM OPERATIONS (per Diluted Share) For the Year Ended 12/31/03 ------------------------ Net income, per diluted share $0.62-0.67 Depreciation - real estate 1.36 Amortization - deferred tenant costs 0.07 Amortization - fair value of acquired leases 0.08 Gain on sale or disposition: Non-operating assets (0.03) ------------------------ Funds from operations, per diluted share $2.10-2.15 ======================== CONTACT: Koger Equity, Inc. Thomas C. Brockwell, 561-395-9666 Supplemental Operating & Financial Data Second Quarter 2003 KOGER EQUITY, INC. AND SUBSIDIARIES SUPPLEMENTAL INFORMATION TABLE OF CONTENTS / "SAFE HARBOR" JUNE 30, 2003 Page ----------- I. Financial Data - Consolidated Balance Sheets 2 - Consolidated Statement of Operations 3 - 4 - Funds from Operations 5 - Net Operating Income 6 - 7 - Capital Expenditures 8 - Summary of Outstanding Debt 9 II. Acquisition/Construction Summaries - Operating Property Acquisitions 10 - Building Completions 11 - Buildings Under Construction 12 III. Portfolio Operating Statistics - Twenty-Five Largest Tenants 13 - Industry Diversification 14 - Summary of Assets By City 15 - Occupancy/Leased Summary 16 - Occupancy Trend 17 - Leasing Summary 18 - 19 - Lease Distribution 20 - Lease Expirations 21 - Net Effective Rents 22 - Capital Expenditure Leasing Commitment 23 - Same Suite Analysis 24 - 25 IV. Special Items - Special Items Included In Results 26 This supplemental package may contain forward-looking statements under the meaning of the Private Securities Litigation Reform Act of 1995. Although Koger Equity, Inc. believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, there can be no assurance that the expectations will be attained. Forward-looking statements are not guarantees of future performance and therefore, undue reliance should not be placed on them. Please refer to our filings with the Securities and Exchange Commission for a more detailed discussion of the risks that may have a direct bearing on our operating results, performance and financial condition. Koger Equity, Inc. claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events. 1
KOGER EQUITY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS Dollars in thousands - ------------------------------------------------------------------------------------------------------------------------ (Unaudited) (Unaudited) (Unaudited) (Unaudited) 6/30/03 3/31/03 12/31/02 9/30/02 6/30/02 ------------------------------------------------------------ ASSETS Real Estate Investments: Operating properties: Land $110,653 $110,653 $110,653 $98,253 $98,253 Buildings 784,145 779,914 783,185 688,363 685,975 Furniture and equipment 3,488 3,488 3,320 3,120 2,987 Accumulated depreciation (164,470) (157,023) (149,830) (142,295) (136,010) ------------------------------------------------------------ Operating properties, net 733,816 737,032 747,328 647,441 651,205 Undeveloped land held for investment 9,995 9,995 9,995 11,015 13,779 Undeveloped land held for sale 3,041 3,831 3,831 2,840 76 Cash and temporary investments 4,741 5,893 4,627 10,930 14,564 Restricted cash 14,417 13,191 13,340 0 0 Accounts receivable, net 13,007 12,657 12,183 10,744 9,802 Cost in excess of fair value of net assets acquired, net of accumulated amortization 595 595 595 595 595 Other assets 17,126 18,091 13,186 11,939 11,809 ------------------------------------------------------------ TOTAL ASSETS $796,738 $801,285 $805,085 $695,504 $701,830 ============================================================ LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Mortgages and loan payable $426,371 $431,660 $431,698 $314,994 $321,217 Accounts payable 2,648 2,486 3,801 3,236 1,837 Accrued real estate taxes payable 7,997 4,022 147 6,336 6,358 Other accrued liabilities 10,889 9,969 13,435 9,929 8,903 Dividends payable 7,463 7,458 7,453 7,453 7,452 Advance rents and security deposits 5,224 5,678 5,483 5,137 4,656 ------------------------------------------------------------ Total Liabilities 460,592 461,273 462,017 347,085 350,423 ------------------------------------------------------------ Shareholders' Equity: Common stock 298 298 298 298 298 Capital in excess of par value 472,364 472,253 472,156 472,012 471,974 Notes receivable from stock sales to related parties (5,266) (5,266) (5,266) (5,066) (5,066) Other comprehensive loss (212) (212) (212) 0 0 Retained earnings 613 4,626 7,813 12,726 15,784 Treasury stock, at cost (131,651) (131,687) (131,721) (131,551) (131,583) ------------------------------------------------------------ Total Shareholders' Equity 336,146 340,012 343,068 348,419 351,407 ------------------------------------------------------------ TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $796,738 $801,285 $805,085 $695,504 $701,830 ============================================================
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KOGER EQUITY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) In thousands, except per share data - ----------------------------------------------------------------------------------------------------------- Three Months Ended ----------------------------------------------------------- 6/30/03 3/31/03 12/31/02 9/30/02 6/30/02 ----------------------------------------------------------- REVENUES Rental and other rental services $35,964 $36,280 $32,065 $31,836 $31,855 Management fees 126 205 757 839 963 Other 0 5 51 0 0 ----------------------------------------------------------- Total operating revenues 36,090 36,490 32,873 32,675 32,818 ----------------------------------------------------------- EXPENSES Property operations 14,694 13,349 12,002 11,846 11,928 Depreciation and amortization 8,156 8,456 7,993 6,663 6,731 General and administrative 3,086 2,943 2,953 2,971 2,947 Direct cost of management fees 2 86 705 797 822 Other 31 36 18 43 49 ----------------------------------------------------------- Total operating expenses 25,969 24,870 23,671 22,320 22,477 ----------------------------------------------------------- OPERATING INCOME 10,121 11,620 9,202 10,355 10,341 ----------------------------------------------------------- OTHER INCOME AND EXPENSE Interest income 86 54 76 98 87 Mortgage and loan interest (7,367) (7,403) (7,281) (6,041) (6,029) ----------------------------------------------------------- Total other income and expense (7,281) (7,349) (7,205) (5,943) (5,942) INCOME BEFORE GAIN (LOSS) ON SALE OR DISPOSITION OF ASSETS 2,840 4,271 1,997 4,412 4,399 Gain (loss) on sale or disposition of assets 589 0 19 1 0 ----------------------------------------------------------- INCOME BEFORE INCOME TAXES 3,429 4,271 2,016 4,413 4,399 Income taxes (21) 0 (525) 19 62 ----------------------------------------------------------- INCOME BEFORE MINORITY INTEREST 3,450 4,271 2,541 4,394 4,337 Minority interest 0 0 0 0 0 ----------------------------------------------------------- NET INCOME $3,450 $4,271 $2,541 $4,394 $4,337 =========================================================== EARNINGS PER SHARE - Diluted $0.16 $0.20 $0.12 $0.21 $0.20 =========================================================== WEIGHTED AVERAGE SHARES - Diluted 21,382 21,327 21,332 21,410 21,469 =========================================================== OPERATING MARGIN 59.1% 63.2% 62.6% 62.8% 62.6% ===========================================================
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KOGER EQUITY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) In thousands, except per share data - ------------------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended ------------------------------------------------------------------------ 6/30/03 6/30/02 Fav/(Unfav) 6/30/03 6/30/02 Fav/(Unfav) ------------------------------------------------------------------------ REVENUES Rental and other rental services $35,964 $31,855 $4,109 $72,244 $62,450 $9,794 Management fees 126 963 (837) 331 1,751 (1,420) Other 0 0 0 5 3 2 ------------------------------------------------------------------------ Total operating revenues 36,090 32,818 3,272 72,580 64,204 8,376 ------------------------------------------------------------------------ EXPENSES Property operations 14,694 11,928 (2,766) 28,043 22,387 (5,656) Depreciation and amortization 8,156 6,731 (1,425) 16,612 13,253 (3,359) General and administrative 3,086 2,947 (139) 6,029 5,457 (572) Direct cost of management fees 2 822 820 88 1,833 1,745 Other 31 49 18 67 81 14 ------------------------------------------------------------------------ Total operating expenses 25,969 22,477 (3,492) 50,839 43,011 (7,828) ------------------------------------------------------------------------ OPERATING INCOME 10,121 10,341 (220) 21,741 21,193 548 ------------------------------------------------------------------------ OTHER INCOME AND EXPENSE Interest income 86 87 (1) 140 232 (92) Mortgage and loan interest (7,367) (6,029) (1,338) (14,770) (11,824) (2,946) ------------------------------------------------------------------------ Total other income and expense (7,281) (5,942) (1,339) (14,630) (11,592) (3,038) INCOME BEFORE GAIN (LOSS) ON SALE OR DISPOSITION OF ASSETS 2,840 4,399 (1,559) 7,111 9,601 (2,490) Gain (loss) on sale or disposition of assets 589 0 589 589 1 588 ------------------------------------------------------------------------ INCOME BEFORE INCOME TAXES 3,429 4,399 (970) 7,700 9,602 (1,902) Income taxes (21) 62 83 (21) 94 115 ------------------------------------------------------------------------ INCOME BEFORE MINORITY INTEREST 3,450 4,337 (887) 7,721 9,508 (1,787) Minority interest 0 0 0 0 20 20 ------------------------------------------------------------------------ NET INCOME $3,450 $4,337 $(887) $7,721 $9,488 $(1,767) ======================================================================== EARNINGS PER SHARE - Diluted $0.16 $0.20 $(0.04) $0.36 $0.44 $(0.08) ======================================================================== WEIGHTED AVERAGE SHARES - Diluted 21,382 21,469 (87) 21,335 21,408 (73) ======================================================================== OPERATING MARGIN 59.1% 62.6% 61.2% 64.2% ========================== =======================
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KOGER EQUITY, INC. AND SUBSIDIARIES FUNDS FROM OPERATIONS (Unaudited) In thousands, except per share data - ---------------------------------------------------------------------------------------------------------------- Three Months Ended ----------------------------------------------------------------------- 6/30/03 3/31/03 12/31/02 9/30/02 6/30/02 ----------------------------------------------------------------------- Funds from Operations: Net income $3,450 $4,271 $2,541 $4,394 $4,337 Depreciation - real estate 7,390 7,191 7,396 6,174 6,277 Amortization - deferred tenant costs 432 396 444 378 338 Amortization - fair value of acquired leases 432 492 0 0 0 Loss (gain) on sale of non-operating assets (589) 0 (19) (1) 0 ----------------------------------------------------------------------- Funds from Operations (a) 11,115 12,350 10,362 10,945 10,952 Cash Available for Distribution: Add (Deduct): Rental income from straight-line rents (1,098) (1,295) (404) (730) (534) Amortization of deferred financing costs 368 357 1,291 303 299 Revenue Maintaining Building improvements (695) (661) (2,091) (332) (1,285) Revenue maintaining tenant improvements (b) (1,391) (1,253) (1,464) (1,767) (1,070) Revenue maintaining leasing commissions (b) (266) (374) (569) (205) (479) ----------------------------------------------------------------------- Cash Available for Distribution (a) $8,033 $9,124 $7,125 $8,214 $7,883 ======================================================================= Weighted average common shares/units outstanding - diluted 21,382 21,327 21,332 21,410 21,469 ======================================================================= Per share/unit - diluted: Funds from operations $0.52 $0.58 $0.49 $0.51 $0.51 ======================================================================= Cash available for distribution $0.38 $0.43 $0.33 $0.38 $0.37 ======================================================================= Dividends paid $0.35 $0.35 $0.35 $0.35 $0.35 ======================================================================= Dividend payout ratio: Funds from operations 67.3% 60.4% 72.1% 68.5% 68.6% ======================================================================= Cash available for distribution 93.2% 81.8% 104.8% 91.2% 95.3% =======================================================================
(a) Funds from Operations and Cash Available for Distribution are non-GAAP financial measures and should not be considered as comparable to Net Income or Earnings per Share. (b) The amounts for the periods ending in 2002 represent the leasing costs associated with 2nd generation space. 5
KOGER EQUITY, INC. AND SUBSIDIARIES NET OPERATING INCOME (a) (b) (Unaudited) In thousands, except SF and per share data - --------------------------------------------------------------------------------------- Three Months Ended ------------------------------------------------------ 6/30/03 3/31/03 12/31/02 9/30/02 6/30/02 ------------------------------------------------------ Same Store Sales: Properties 120 Revenue $27,377 $27,538 $27,353 $28,138 $28,442 Square Feet 6,922,052 Expense 10,312 9,631 10,038 10,369 9,923 ------------------------------------------------------ NOI 17,065 17,907 17,315 17,769 18,519 ------------------------------------------------------ Occupancy - Period End 85.8% 83.8% 87.1% 88.2% 88.9% Acquisitions: Properties 4 Revenue(c) $8,452 $8,596 $4,741 $3,583 $3,305 Square Feet 2,009,380 Expense 4,421 3,789 1,962 1,575 1,665 ------------------------------------------------------ NOI 4,031 4,807 2,779 2,008 1,640 ------------------------------------------------------ Occupancy - Period End 71.0% 71.8% 72.0% 25.4% 25.3% Development: Properties - Revenue $- $- $- $- $- Square Feet - Expense - - - - - ------------------------------------------------------ NOI - - - - - ------------------------------------------------------ Occupancy - Period End 0.0% 0.0% 0.0% 0.0% 0.0% Asset Sales: Properties - Revenue $289 $(29) $(29) $115 $108 Square Feet - Expense (40) (71) 2 (97) 340 ------------------------------------------------------ NOI 329 42 (31) 212 (232) ------------------------------------------------------ Occupancy - Period End 0.0% 0.0% 0.0% 0.0% 0.0% Consolidated Portfolio Revenue $36,118 $36,105 $32,065 $31,836 $31,855 Expense 14,693 13,349 12,002 11,847 11,928 ------------------------------------------------------ NOI 21,425 22,756 20,063 19,989 19,927 ------------------------------------------------------ Occupancy - Period End 82.5% 81.1% 83.7% 85.6% 86.2%
(a) Net Operating Income is defined as Rental and other rental services revenue less Property operating expense, excluding amortization of the fair value of acquired leases. (b) Net Operating Income is a non-GAAP financial measure and should not be considered as comparable to Net Income. (c) Excludes adjustments for the fair value of acquired leases for the period ended 3/31/03 and 6/30/03, $175 and ($154) respectively. 6
KOGER EQUITY, INC. AND SUBSIDIARIES NET OPERATING INCOME (a) (b) (Unaudited) In thousands, except SF and per share data - ------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended ------------------------------ -------------------------------- 6/30/03 6/30/02 Fav/(Unfav)6/30/03 6/30/02 Fav/(Unfav) --------- --------- ------------------- -------- ------------ Same Store Sales: Properties 120 Revenue $27,377 $28,442 $(1,065) $54,915 $56,804 $(1,889) Square Feet 6,922,052 Expense 10,312 9,923 (389) 19,943 19,337 (606) --------- --------- -------- -------- -------- ------------ NOI 17,065 18,519 (1,454) 34,972 37,467 (2,495) --------- --------- -------- -------- -------- ------------ Occupancy - Period End 85.8% 88.9% -3.1% 85.8% 88.9% -3.1% Acquisitions: Properties 4 Revenue(c) $8,452 $3,305 $5,147 $17,048 $5,511 $11,537 Square Feet 2,009,380 Expense 4,421 1,665 (2,756) 8,210 2,676 (5,534) --------- --------- -------- -------- -------- ------------ NOI 4,031 1,640 2,391 8,838 2,835 6,003 --------- --------- -------- -------- -------- ------------ Occupancy - Period End 71.0% 25.3% 45.7% 71.0% 25.3% 45.7% Development: Properties - Revenue $- $- $- $- $- $- Square Feet - Expense - - - - - - --------- --------- -------- -------- -------- ------------ NOI - - - - - - --------- --------- -------- -------- -------- ------------ Occupancy - Period End 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% Asset Sales: Properties - Revenue $289 $108 $181 $260 $135 $125 Square Feet - Expense (40) 340 380 (111) 373 484 --------- --------- -------- -------- -------- ------------ NOI 329 (232) 561 371 (238) 609 --------- --------- -------- -------- -------- ------------ Occupancy - Period End 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% Consolidated Portfolio Revenue $36,118 $31,855 $4,263 $72,223 $62,450 $9,773 Expense 14,693 11,928 (2,765) 28,042 22,386 (5,656) --------- --------- -------- -------- -------- ------------ NOI 21,425 19,927 1,498 44,181 40,064 4,117 --------- --------- -------- -------- -------- ------------ Occupancy - Period End 82.5% 86.2% -3.8% 82.5% 86.2% -3.8%
(a) Net Operating Income is defined as Rental and other rental services revenue less Property operating expense, excluding amortization of the fair value of acquired leases. (b) Net Operating Income is a non-GAAP financial measure and should not be considered as comparable to Net Income. (c) Excludes adjustments for the fair value of acquired leases for the period ended 3/31/03 and 6/30/03, $175 and ($154) respectively. 7 KOGER EQUITY, INC. AND SUBSIDIARIES CAPITAL EXPENDITURES (Unaudited)
- -------------------------------------------------------------------------------------------------------------------- Three Months Ended ------------------------------------------------------------------------ 6/30/03 3/31/03 12/31/02 9/30/02 6/30/02 ------------ ------------ ------------ ------------ ------------ Revenue Maintaining: Building Improvements $694,892 $660,966 $2,091,048 $332,300 $1,285,274 Tenant Improvements - 2001 Leasing 26,104 48,310 298,454 30,754 - Tenant Improvements - 2002 Leasing 217,127 926,380 1,060,884 1,139,035 716,686 Tenant Improvements - 2003 Leasing 1,148,118 277,853 - - - Leasing Commissions - 2001 Leasing 2,047 1,641 5,452 - 216,801 Leasing Commissions - 2002 Leasing 661 150,832 736,406 208,940 - Leasing Commissions - 2003 Leasing 263,379 221,203 - - - ------------ ------------ ------------ ------------ ------------ Revenue Maintaining Capital Expenditures 2,352,328 2,287,185 4,192,244 1,711,029 2,218,761 ------------ ------------ ------------ ------------ ------------ Revenue Enhancing: Building Improvements 781,462 88,181 - - - Tenant Improvements - 2002 Leasing 732,711 1,005,839 359,906 754,092 1,278,692 Tenant Improvements - 2003 Leasing 421,104 77,044 - - - Leasing Commissions - 2002 Leasing 10,250 156,756 195,342 137,822 705,399 Leasing Commissions - 2003 Leasing 251,269 42,730 - - - ------------ ------------ ------------ ------------ ------------ Revenue Enhancing Capital Expenditures 2,196,796 1,370,550 555,248 891,914 1,984,091 ------------ ------------ ------------ ------------ ------------ Total Capital Expenditures $4,549,124 $3,657,735 $4,747,492 $2,602,943 $4,202,852 ============ ============ ============ ============ ============
8
KOGER EQUITY, INC. AND SUBSIDIARIES SUMMARY OF OUTSTANDING DEBT AS OF JUNE 30, 2003 Outstanding Monthly Balance Interest Debt ------------------ Description Rate Maturity Service 6/30/03 12/31/02 - ------------------------------- -------- --------- -------- -------- --------- $(000) $(000) $(000) Fixed Rate: Northwestern Mutual - Tranche A 8.19% 01/02/07 789 90,376 91,394 Northwestern Mutual - Tranche B 8.33% 01/02/09 710 80,431 81,331 Northwestern Mutual - Tranche C 7.10% 01/02/07 105 13,804 13,942 Northwestern Mutual - Tranche D 7.10% 01/02/09 216 28,454 28,738 New York Life 8.00% 01/10/03 0 - 7,718 Allstate Life 8.20% 12/01/06 165 18,816 19,066 Metropolitan Life 5.26% 01/01/08 373 85,000 85,000 -------- -------- --------- Total Fixed Rate Debt 7.29% 2,358 316,881 327,189 -------- -------- --------- Variable Rate: GE Capital 7.38% 06/30/21 12 1,490 1,509 Column Financial (2) 4.05% 12/09/04 262 77,000 77,000 Secured Revolving Credit Facility - $100 Million 3.33% 12/27/04 85 31,000 26,000 -------- -------- --------- Total Variable Rate Debt 3.89% 359 109,490 104,509 -------- -------- --------- Total Debt 6.42% 2,717 426,371 431,698 ======== ======== ========= Market Capitalization: Total Debt 426,371 431,698 Common Stock 367,385 332,200 -------- --------- Total Market Capitalization 793,756 763,898 ======== ========= - ------------------------------------------------------------------------------ Amount -------- $(000) Schedule of Mortgage Maturities by Year (1): 2003 2,593 2004 82,631 2005 6,112 2006 23,706 2007 98,098 Thereafter 182,231 -------- Total 395,371 ======== (1) Does not include Secured Revolving Credit Facility. (2) Interest rate capped at 287 basis points over maximum LIBOR of 5.45 percent.
9
KOGER EQUITY, INC. AND SUBSIDIARIES OPERATING PROPERTY ACQUISITIONS 2002 AND 2003 Rentable Percent Square Date Purchase Leased Property Location Feet Purchased Price (1) 6/30/03 - ------------------------ ---------------------- ------------ ----------- ------------------ ----------- 2002 - ---- Three Ravinia Atlanta, GA 804,528 01/31/02 $125,000,000 67% The Lakes on Post Oak Houston, TX 1,204,852 12/06/02 101,850,000 76% ------------ ------------------ 2,009,380 $226,850,000 72% ============ ================== =========== 2003 - ----- None
(1) Purchase price consists of the contract price only and does not include closing costs. 10
KOGER EQUITY, INC. AND SUBSIDIARIES BUILDING COMPLETIONS 2002 AND 2003 Percent Square Month Leased Property Location Feet Completed Total Cost(1) 6/30/03 - ----------------------- ----------------------- ---------- ----------- ------------ ------------------------------------ 2002 - ---- None. 2003 - ---- None.
11
KOGER EQUITY, INC. AND SUBSIDIARIES BUILDINGS UNDER CONSTRUCTION JUNE 30, 2003 Square Expected Projected Pre-Leasing Property Location Feet Completion Cost (1) to Date - ---------------------- ------------------ --------- ----------- ------------ ----------------- None. --------- ------------ - $- ========= ============ ================= (1) Includes land and building construction costs. Does not include tenant improvement costs.
12
KOGER EQUITY, INC. AND SUBSIDIARIES TWENTY-FIVE LARGEST TENANTS BASED ON ANNUALIZED GROSS RENTS AS OF JUNE 30, 2003 Remaining Annualized Number Occupied Term Percent of Gross Percent Tenant (a) of Square (Months) Occupied Rent (b) of Rent Leases Feet - ------------------------------------------------ ------- ---------- --------- -------- ------------ ------- U S Government 42 930,019 88 12.7% $17,283,595 12.7% State Of Florida 40 691,687 28 9.5% 12,730,992 9.4% Blue Cross & Blue Shield 11 579,084 23 7.9% 9,594,681 7.1% Six Continents Hotels 2 344,389 63 4.7% 9,332,600 6.9% Bechtel Corporation 1 347,082 72 4.7% 6,243,591 4.6% Citifinancial 1 159,827 50 2.2% 2,958,751 2.2% Landstar 1 176,000 137 2.4% 2,644,068 1.9% Zurich Insurance Company 2 97,913 43 1.3% 1,895,596 1.4% ACS State Healthcare, LLC 2 79,714 47 1.1% 1,755,352 1.3% Huntsman Corp 2 108,764 117 1.5% 1,709,855 1.3% Hoechst Celanese 1 92,376 0 1.3% 1,667,620 1.2% Washington Mutual Bank 2 86,361 60 1.2% 1,500,179 1.1% Ford Motor Company 4 63,337 35 0.9% 1,363,408 1.0% Bellsouth 4 66,526 32 0.9% 1,076,428 0.8% Siemens 2 64,883 7 0.9% 987,005 0.7% Sara Lee 2 52,021 24 0.7% 937,241 0.7% Enovia Corporation 1 44,095 14 0.6% 867,655 0.6% Best Software Inc. 1 47,110 66 0.6% 770,249 0.6% Check Solutions Company 1 40,307 67 0.6% 760,697 0.6% Navision Software 1 37,783 50 0.5% 741,554 0.5% Peerless Insurance Co. 1 36,306 29 0.5% 715,098 0.5% Sungard Trust Systems Inc. 2 43,569 36 0.6% 710,039 0.5% Mergent - FIS Inc. 1 45,040 50 0.6% 698,120 0.5% Hirecheck Inc. 1 30,226 56 0.4% 679,174 0.5% Georgia Medical Care Foundation 1 37,822 70 0.5% 675,123 0.5% ------- ---------- ------------ Total / Weighted Average 129 4,302,241 56 58.8% $80,298,668 59.2% ======= ========== ========= ======== ============ =======
(a) Actual tenant may be a subsidiary of, or an entity affiliated with, the named tenant. (b) Annualized Gross Rent is the monthly contractual base rent and current reimbursements under existing leases as of June 30, 2003 multiplied by 12. 13
KOGER EQUITY, INC. AND SUBSIDIARIES INDUSTRY DIVERSIFICATION AS OF JUNE 30, 2003 Remaining Annualized Number Occupied Term Percent of Gross Percent Industry (a) of Square (Months) Occupied Rent (b) of Rent Leases Feet - ----------------------------------------------- ------- ---------- --------- -------- ------------- ------- Finance and Insurance 151 1,733,077 32 23.7% $31,447,570 23.2% Public Adminstration 87 1,660,193 61 22.7% 30,612,330 22.6% Professional, Scientific, and Technical Services 171 1,388,000 46 19.0% 25,855,784 19.1% Manufacturing 54 645,812 43 8.8% 11,394,093 8.4% Accomodation and Food Services 9 360,704 60 4.9% 9,539,520 7.0% Information 43 441,312 41 6.0% 7,803,913 5.8% Transportation and Warehousing 8 207,535 120 2.8% 3,277,043 2.4% Administrative and Support Services 23 144,354 42 2.0% 2,617,745 1.9% Construction 16 121,280 22 1.7% 2,266,839 1.7% Educational Services 16 94,437 32 1.3% 1,783,887 1.3% Health Care and Social Assistance 18 77,157 26 1.1% 1,367,663 1.0% Other (c) 290 437,248 27 6.0% 7,638,647 5.6% ------- ---------- -------- ------------- ------- Total / Weighted Average 886 7,311,109 46 100.0% $135,605,033 100.0% ======= ========== ========= ======== ============= =======
(a) Classifications are based on the North American Indistrial Classification System (NAICS). (b) Annualized Gross Rent is the monthly contractual base rent and current reimbursements under existing leases as of June 30, 2003 multiplied by 12. (c) Includes leases whose classification does not total 1.0% or more of the portfolio's annualized gross rent. 14
KOGER EQUITY, INC. AND SUBSIDIARIES SUMMARY OF ASSETS BY CITY AS OF JUNE 30, 2003 # of Age % Square % City State Bldgs (yrs) Square Feet Feet NOI (a) - ---------------------- ---------- ------- ------- --------------- ------------ --------------- Atlanta GA 26 16 2,367,994 26.5% 30.9% Jacksonville FL 11 9 1,168,203 13.1% 15.6% Orlando FL 28 19 1,303,153 14.6% 15.1% Houston TX 3 23 1,204,852 13.5% 10.1% Tallahassee FL 19 21 834,025 9.3% 7.2% St. Petersburg FL 15 20 668,144 7.5% 7.2% Charlotte NC 15 16 709,246 7.9% 6.6% Memphis TN 6 10 530,688 5.9% 5.2% Richmond VA 1 15 145,127 1.6% 2.2% ------- --------------- ------------ --------------- Total 124 17 8,931,432 100.0% 100.0% ======= ======= =============== ============ ===============
(a) Based on Net Operating Income for the second quarter of 2003. 15
KOGER EQUITY, INC. AND SUBSIDIARIES OCCUPANCY SUMMARY AS OF JUNE 30, 2003 Square Footage Percentage ------------------------------------------------ --------------------------------------- Leased, Not Leased, Not Commenced Occupied Commenced (a) Vacant Total Occupied (a) Vacant Total ------------------------------------------------ --------------------------------------- Atlanta 1,965,316 0 402,678 2,367,994 83.0% 0.0% 17.0% 100.0% Jacksonville 1,156,829 4,610 6,764 1,168,203 99.0% 0.4% 0.6% 100.0% Orlando 1,090,238 5,776 207,139 1,303,153 83.7% 0.4% 15.9% 100.0% Houston 890,035 24,520 290,297 1,204,852 73.9% 2.0% 24.1% 100.0% Tallahassee 595,557 0 238,468 834,025 71.4% 0.0% 28.6% 100.0% St. Petersburg 571,262 14,228 82,654 668,144 85.5% 2.1% 12.4% 100.0% Charlotte 555,348 7,163 146,735 709,246 78.3% 1.0% 20.7% 100.0% Memphis 398,625 37,186 94,877 530,688 75.1% 7.0% 17.9% 100.0% Richmond 141,013 0 4,114 145,127 97.2% 0.0% 2.8% 100.0% -------------------------------------------------- Total 7,364,223 93,483 1,473,726 8,931,432 82.5% 1.0% 16.5% 100.0% ===========================================================================================
(a) Includes square footage of fully executed leases for vacant space that commence on a future date. 16 KOGER EQUITY, INC. AND SUBSIDIARIES OCCUPANCY SUMMARY
As of --------------------------------------------------------------- MSA Square Feet 6/30/2003 3/31/2003 12/31/2002 9/30/2002 6/30/2002 ---------------------------------------------------------------------------------- Atlanta - SSS 1,563,466 1,429,547 1,347,087 1,415,731 1,405,961 1,363,854 91.4% 86.2% 90.6% 89.9% 87.2% Orlando 1,303,153 1,090,238 1,056,117 1,158,989 1,215,547 1,215,820 83.7% 81.0% 88.9% 93.3% 93.3% Jacksonville 1,168,203 1,156,829 1,125,451 1,156,395 1,156,973 1,151,758 99.0% 96.3% 99.0% 99.0% 98.6% Charlotte 709,246 555,348 555,740 571,548 574,139 606,586 78.3% 78.4% 80.6% 81.0% 85.5% St. Petersburg 668,144 571,262 571,096 571,967 576,970 575,697 85.5% 85.5% 85.6% 86.4% 86.2% Tallahassee 834,025 595,557 596,237 595,144 600,038 651,426 71.4% 71.5% 71.4% 71.9% 78.1% Memphis 530,688 398,625 410,781 416,116 434,426 443,745 75.1% 77.4% 78.4% 81.9% 83.6% Richmond 145,127 141,013 137,733 141,752 141,752 145,008 97.2% 94.9% 97.7% 97.7% 99.9% ---------------------------------------------------------------------------------- Same Store 6,922,052 5,938,419 5,800,242 6,027,642 6,105,806 6,153,894 85.8% 83.8% 87.1% 88.2% 88.9% ---------------------------------------------------------------------------------- Houston 1,204,852 890,035 937,575 941,411 0 0 73.9% 77.8% 78.1% 0.0% 0.0% Atlanta - ACQ 804,528 535,769 505,324 505,324 509,578 507,423 66.6% 62.8% 62.8% 63.3% 63.1% ---------------------------------------------------------------------------------- Acquisitions 2,009,380 1,425,804 1,442,899 1,446,735 509,578 507,423 71.0% 71.8% 72.0% 25.4% 25.3% ---------------------------------------------------------------------------------- Total 8,931,432 7,364,223 7,243,141 7,474,377 6,615,384 6,661,317 82.5% 81.1% 83.7% 85.6% 86.2% ==================================================================================
17
KOGER EQUITY, INC. AND SUBSIDIARIES LEASING SUMMARY For The Three Months Ended 6/30/03 ----------------------------------------------------------------------------------------------- MSA Leased ExpirationsRenewals Leasing New and Gross Net Leased Leased Leased Square 3/31/03 (b) (c) Retention Backfill Activity Absorption 6/30/03 3/31/03 6/30/03 Feet (a) (a) ----------------------------------------- ------------------------------------------------------------------- Atlanta 2,367,994 1,937,987 43,825 28,296 64.6% 42,858 71,154 27,329 1,965,316 81.8% 83.0% Jacksonville 1,168,203 1,167,065 19,386 1,300 6.7% 12,460 13,760 (5,626) 1,161,439 99.9% 99.4% Orlando 1,303,153 1,095,041 32,475 17,724 54.6% 15,724 33,448 973 1,096,014 84.0% 84.1% Houston 1,204,852 956,667 61,133 14,187 23.2% 4,834 19,021 (42,112) 914,555 79.4% 75.9% Tallahassee 834,025 596,237 10,375 2,948 28.4% 6,747 9,695 (680) 595,557 71.5% 71.4% St. Petersburg 668,144 573,930 16,656 7,126 42.8% 21,090 28,216 11,560 585,490 85.9% 87.6% Charlotte 709,246 562,279 30,881 11,588 37.5% 19,525 31,113 232 562,511 79.3% 79.3% Memphis 530,688 413,456 41,085 22,570 54.9% 40,870 63,440 22,355 435,811 77.9% 82.1% Richmond 145,127 141,594 3,096 2,515 81.2% 0 2,515 (581) 141,013 97.6% 97.2% ---------- ---------- -------- -------- -------- -------- -------- ---------- Total 8,931,432 7,444,256 258,912 108,254 41.8% 164,108 272,362 13,450 7,457,706 83.3% 83.5% ========== ========== ======== ======== ===== ======== ======== ======== ========== ======== ===== (a) Leased figures include all leases in effect as of the period end date, including those leases expiring on the period end date, as well as fully executed leases for vacant space that commences on a future date. (b) Includes the rentable square footage of expired leases, as well as the square footage of future expirations for which renewal and backfills have been signed. (c) Expirations also include leases that ended due to a termination right or default.
18
KOGER EQUITY, INC. AND SUBSIDIARIES LEASING SUMMARY For The Six Months Ended 6/30/03 ------------------------------------------------------------------------------------------------ MSA Leased Expirations Renewals Leasing New and Gross Net Leased Leased Leased Square 12/31/02 (b) (c) Retention Backfill Activity Absorption 6/30/03 12/31/02 6/30/03 Feet (a) (a) ----------------------------------------- -------------------------------------------------------------------- Atlanta 2,367,994 1,975,803 154,947 81,230 52.4% 63,230 144,460 (10,487) 1,965,316 83.4% 83.0% Jacksonville 1,168,203 1,161,576 137,724 91,228 66.2% 46,359 137,587 (137) 1,161,439 99.4% 99.4% Orlando 1,303,153 1,161,439 155,906 28,529 18.3% 61,952 90,481 (65,425) 1,096,014 89.1% 84.1% Houston 1,204,852 949,973 94,064 31,914 33.9% 26,732 58,646 (35,418) 914,555 78.8% 75.9% Tallahassee 834,025 595,144 41,920 30,951 73.8% 11,382 42,333 413 595,557 71.4% 71.4% St. Petersburg 668,144 578,726 53,741 29,640 55.2% 30,865 60,505 6,764 585,490 86.6% 87.6% Charlotte 709,246 571,548 66,131 20,966 31.7% 36,128 57,094 (9,037) 562,511 80.6% 79.3% Memphis 530,688 416,949 54,575 25,679 47.1% 47,758 73,437 18,862 435,811 78.6% 82.1% Richmond 145,127 141,752 16,455 2,515 15.3% 13,201 15,716 (739) 141,013 97.7% 97.2% ---------- ---------- -------- -------- -------- -------- -------- ---------- Total 8,931,432 7,552,910 775,463 342,652 44.2% 337,607 680,259 (95,204) 7,457,706 84.6% 83.5% ========== ========== ======== ======== ===== ======== ======== ======== ========== ========= =====
(a) Leased figures include all leases in effect as of the period end date, including those leases expiring on the period end date, as well as fully executed leases for vacant space that commences on a future date. (b) Includes the rentable square footage of expired leases, as well as the square footage of future expirations for which renewal and backfills have been signed. (c) Expirations also include leases that ended due to a termination right or default. 19
KOGER EQUITY, INC. AND SUBSIDIARIES LEASE DISTRIBUTION AS OF JUNE 30, 2003 Tenant Occupied Percent Annualized Average Percent Number of Percent of Square of Square Gross Annualized of Total Remaining Category Leases (1) Leases Feet (2) Feet Rent (3) Rent PSF Rents Term - --------------------- ----------- ---------- ----------- ----------- ------------- ---------- ---------- --------- 2,500 or Less 430 48.5% 529,455 7.2% $9,558,143 $18.05 7.0% 22 2,501 - 5,000 199 22.5% 715,880 9.8% 13,409,150 18.73 9.9% 26 5,001 - 7,500 76 8.6% 473,853 6.5% 8,892,920 18.77 6.6% 28 7,501 - 10,000 44 5.0% 381,919 5.2% 6,969,897 18.25 5.1% 33 10,001 - 20,000 53 6.0% 763,682 10.4% 14,444,543 18.91 10.7% 30 20,001 - 40,000 48 5.4% 1,382,036 18.9% 24,875,859 18.00 18.3% 52 40,001 - 60,000 19 2.1% 927,003 12.7% 17,169,574 18.52 12.7% 51 60,001 - 100,000 12 1.4% 987,064 13.5% 18,135,255 18.37 13.4% 60 100,001 or Greater 5 0.6% 1,150,217 15.7% 22,149,693 19.26 16.3% 71 ----------- ---------- ----------- ----------- ------------- ---------- Total / Weighted Average 886 100.0% 7,311,109 100.0% $135,605,033 $18.55 100.0% 46 =========== ========== =========== =========== ============= ========== ========== ========= Square Feet % of Total ------------- ---------- Square footage occupied by tenants 7,311,109 81.9% Square footage attributable to vending/antenna 1,661 0.0% Square footage occupied by owner/building use 51,453 0.6% ------------- ---------- Total Occupied Square Footage 7,364,223 82.5% ------------- ---------- Leased square footage 93,483 1.0% Vacant square footage 1,473,726 16.5% ------------- ---------- Total Net Rentable Square Footage 8,931,432 100.0% ============= ==========
(1) Analysis does not include owner occupied space, vending leases and antenna leases. (2) Total net rentable square feet represented by existing leases. (3) Annualized Gross Rent is the monthly contractual base rent and current reimbursements under existing leases as of June 30, 2003 multiplied by 12. Rent abatements are not included in this analysis. 20
KOGER EQUITY, INC. AND SUBSIDIARIES LEASE EXPIRATIONS AS OF JUNE 30, 2003 City Item 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 - --------- ---------- ----------------------------------------------------------------------------------------------------------- Atlanta Square Feet (1) 92,001 138,426 191,959 89,825 191,602 187,746 644,394 101,897 26,201 95,305 % Square Feet (2) 3.89% 5.85% 8.11% 3.79% 8.09% 7.93% 27.21% 4.30% 1.11% 4.02% Annualized Rent (3) 1,968,797 3,200,335 3,780,884 1,613,775 3,916,449 3,630,974 14,590,779 1,809,718 652,106 2,015,025 Number of Leases (4) 35 38 32 30 21 14 14 2 1 4 Rent PSF $21.40 $23.12 $19.70 $17.97 $20.44 $19.34 $22.64 $17.76 $24.89 $21.14 Jacksonville Square Feet (1) 99,926 90,352 172,508 182,494 275,860 93,198 5,688 0 56,249 0 % Square Feet (2) 8.55% 7.73% 14.77% 15.62% 23.61% 7.98% 0.49% 0.00% 4.82% 0.00% Annualized Rent (3) 1,707,006 1,705,853 2,342,686 3,046,980 5,190,209 1,618,939 110,115 0 955,393 0 Number of Leases (4) 5 6 3 6 6 3 2 0 2 0 Rent PSF $17.08 $18.88 $13.58 $16.70 $18.81 $17.37 $19.36 $0.00 $16.99 $0.00 Orlando Square Feet (1) 195,533 296,162 163,368 127,842 146,697 121,836 25,000 635 0 7,080 % Square Feet (2) 15.00% 22.73% 12.54% 9.81% 11.26% 9.35% 1.92% 0.05% 0.00% 0.54% Annualized Rent (3) 3,538,084 5,433,944 2,936,465 2,407,691 2,213,819 2,182,935 459,306 11,618 0 170,108 Number of Leases (4) 45 63 45 28 12 8 1 1 0 1 Rent PSF $18.09 $18.35 $17.97 $18.83 $15.09 $17.92 $18.37 $18.30 $0.00 $24.03 Houston Square Feet (1) 61,088 81,274 70,108 44,430 90,272 48,491 361,620 25,637 0 0 % Square Feet (2) 5.07% 6.75% 5.82% 3.69% 7.49% 4.02% 30.01% 2.13% 0.00% 0.00% Annualized Rent (3) 1,081,665 1,611,496 1,363,752 851,890 1,675,110 1,013,770 6,513,123 448,438 0 0 Number of Leases (4) 20 23 18 11 8 9 3 3 0 0 Rent PSF $17.71 $19.83 $19.45 $19.17 $18.56 $20.91 $18.01 $17.49 $0.00 $0.00 Tallahassee Square Feet (1) 197,109 78,065 22,120 105,266 94,758 65,182 0 0 26,696 0 % Square Feet (2) 23.63% 9.36% 2.65% 12.62% 11.36% 7.82% 0.00% 0.00% 3.20% 0.00% Annualized Rent (3) 3,602,077 1,411,691 361,865 2,282,328 1,708,546 1,199,334 0 0 347,181 0 Number of Leases (4) 26 22 8 5 2 2 0 0 1 0 Rent PSF $18.27 $18.08 $16.36 $21.68 $18.03 $18.40 $0.00 $0.00 $13.01 $0.00 St. Square Feet Petersburg (1) 59,272 156,598 105,357 56,840 55,241 104,811 12,709 17,686 0 0 % Square Feet (2) 8.87% 23.44% 15.77% 8.51% 8.27% 15.69% 1.90% 2.65% 0.00% 0.00% Annualized Rent (3) 1,011,338 2,375,948 1,777,800 936,843 1,036,163 1,917,668 182,883 251,390 0 0 Number of Leases (4) 28 30 25 10 10 7 1 1 0 0 Rent PSF $17.06 $15.17 $16.87 $16.48 $18.76 $18.30 $14.39 $14.21 $0.00 $0.00 Charlotte Square Feet (1) 169,206 117,995 40,179 82,322 66,881 34,908 40,307 0 0 0 % Square Feet (2) 23.86% 16.64% 5.67% 11.61% 9.43% 4.92% 5.68% 0.00% 0.00% 0.00% Annualized Rent (3) 3,151,293 2,185,786 693,328 1,335,456 1,134,612 562,161 760,697 0 0 0 Number of Leases (4) 17 21 15 10 3 6 1 0 0 0 Rent PSF $18.62 $18.52 $17.26 $16.22 $16.96 $16.10 $18.87 $0.00 $0.00 $0.00 Memphis Square Feet (1) 13,374 48,770 145,100 91,022 40,029 57,831 0 0 0 0 % Square Feet (2) 2.52% 9.19% 27.34% 17.15% 7.54% 10.90% 0.00% 0.00% 0.00% 0.00% Annualized Rent (3) 274,173 979,230 2,751,994 1,638,769 710,195 1,110,684 0 0 0 0 Number of Leases (4) 5 14 27 21 9 5 0 0 0 0 Rent PSF $20.50 $20.08 $18.97 $18.00 $17.74 $19.21 $0.00 $0.00 $0.00 $0.00 Richmond Square Feet (1) 12,739 11,235 45,704 26,153 28,887 4,391 10,563 0 0 0 % Square Feet (2) 8.78% 7.74% 31.49% 18.02% 19.90% 3.03% 7.28% 0.00% 0.00% 0.00% Annualized Rent (3) 254,941 223,793 898,643 500,033 539,219 84,527 208,839 0 0 0 Number of Leases (4) 4 3 5 5 5 1 2 0 0 0 Rent PSF $20.01 $19.92 $19.66 $19.12 $18.67 $19.25 $19.77 $0.00 $0.00 $0.00 Total Square Feet (1) 900,248 1,018,877 956,403 806,194 990,227 718,394 1,100,281 145,855 109,146 102,385 % Square Feet (2) 10.08% 11.41% 10.71% 9.03% 11.09% 8.04% 12.32% 1.63% 1.22% 1.15% Annualized Rent (3) 16,589,376 19,128,076 16,907,416 14,613,765 18,124,321 13,320,992 22,825,741 2,521,163 1,954,681 2,185,132 Number of Leases (4) 185 220 178 126 76 55 24 7 4 5 Rent PSF $18.43 $18.77 $17.68 $18.13 $18.30 $18.54 $20.75 $17.29 $17.91 $21.34
2013 + Total ---------------------- Atlanta Square Feet (1) 189,741 1,949,097 % Square Feet (2) 8.01% 82.31% Annualized Rent (3) 3,221,072 40,399,913 Number of Leases (4) 4 195 Rent PSF $16.98 $20.73 Jacksonville Square Feet (1) 176,000 1,152,275 % Square Feet (2) 15.07% 98.64% Annualized Rent (3) 2,644,068 19,321,249 Number of Leases (4) 1 34 Rent PSF $15.02 $16.77 Orlando Square Feet (1) 0 1,084,153 % Square Feet (2) 0.00% 83.19% Annualized Rent (3) 0 19,353,971 Number of Leases (4) 0 204 Rent PSF $0.00 $17.85 Houston Square Feet (1) 97,358 880,278 % Square Feet (2) 8.08% 73.06% Annualized Rent (3) 1,569,230 16,128,473 Number of Leases (4) 1 96 Rent PSF $16.12 $18.32 Tallahassee Square Feet (1) 0 589,196 % Square Feet (2) 0.00% 70.64% Annualized Rent (3) 0 10,913,023 Number of Leases (4) 0 66 Rent PSF $0.00 $18.52 St. Square Feet Petersburg (1) 0 568,514 % Square Feet (2) 0.00% 85.09% Annualized Rent (3) 0 9,490,032 Number of Leases (4) 0 112 Rent PSF $0.00 $16.69 Charlotte Square Feet (1) 0 551,798 % Square Feet (2) 0.00% 77.80% Annualized Rent (3) 0 9,823,333 Number of Leases (4) 0 73 Rent PSF $0.00 $17.80 Memphis Square Feet (1) 0 396,126 % Square Feet (2) 0.00% 74.64% Annualized Rent (3) 0 7,465,044 Number of Leases (4) 0 81 Rent PSF $0.00 $18.85 Richmond Square Feet (1) 0 139,672 % Square Feet (2) 0.00% 96.24% Annualized Rent (3) 0 2,709,996 Number of Leases (4) 0 25 Rent PSF $0.00 $19.40 Total Square Feet (1) 463,099 7,311,109 % Square Feet (2) 5.19% 81.86% Annualized Rent (3) 1 7,434,369 135,605,033 Number of Leases (4) 6 886 Rent PSF $16.05 $18.55 (1) Total net rentable square feet represented by expiring leases. Expiration date reflects renewal expiration if fully executed. (2) Percentage of total net rentable feet represented by expiring leases. (3) Annualized Gross Rent is the monthly contractual base rent and current reimbursements under existing leases as of June 30, 2003 multiplied by 12. Rent abatements are not included in this analysis. (4) Analysis does not include owner occupied space, vending leases and antenna leases. 21
KOGER EQUITY, INC. AND SUBSIDIARIES NET EFFECTIVE RENTS New & Backfill Leasing --------------------------------------------------------- 6/30/2003 3/31/2003 12/31/2002 9/30/2002 Average ---------- ----------- ----------- ---------- -------- Number of leases 38 42 31 29 35 Rentable square footage leased 126,159 171,239 217,767 108,050 155,804 Average per rentable square foot over the lease term: Gross Rent $16.29 $17.12 $17.06 $17.95 $17.05 Tenant improvements (2.06) (1.47) (2.59) (1.52) (1.89) Leasing commissions (0.67) (0.41) (0.60) (0.49) (0.54) Other/concessions (0.48) (0.58) (1.22) (0.07) (0.59) ---------- ----------- ----------- ---------- -------- Effective Rent 13.08 14.66 12.65 15.87 14.04 Expense stop (5.64) (4.98) (5.34) (5.50) (5.35) ---------- ----------- ----------- ---------- -------- Equivalent effective net rent $7.44 $9.68 $7.31 $10.37 $8.69 ========== =========== =========== ========== ======== Average term (yrs) 5.2 4.8 4.9 4.8 4.9 Renewal Leasing --------------------------------------------------------- 6/30/2003 3/31/2003 12/31/2002 9/30/2002 Average ---------- ----------- ----------- ---------- -------- Number of leases 43 36 50 41 43 Rentable square footage leased 108,254 234,398 414,429 260,287 254,342 Average per rentable square foot over the lease term: Gross Rent $18.85 $19.09 $17.31 $17.25 $18.06 Tenant improvements (0.78) (1.43) (0.18) (0.40) (0.65) Leasing commissions (0.39) (0.12) (0.06) (0.05) (0.15) Other/concessions (0.14) (0.02) (0.10) (0.14) (0.10) ---------- ----------- ----------- ---------- -------- Effective Rent 17.54 17.52 16.97 16.66 17.16 Expense stop (5.57) (5.40) (5.36) (5.06) (5.35) ---------- ----------- ----------- ---------- -------- Equivalent effective net rent $11.97 $12.12 $11.61 $11.60 $11.81 ========== =========== =========== ========== ======== Average term (yrs) 3.2 5.5 2.1 2.7 3.2
22
KOGER EQUITY, INC. AND SUBSIDIARIES CAPITAL EXPENDITURES - LEASING ACTIVITY ----------------------------------------------------------- Three Months Ended, Dollars ----------------------------------------------------------- 6/30/03 3/31/03 12/31/02 9/30/02 6/30/02 ----------- ----------- ----------- ----------- ----------- Renewal Leasing: - ------------------------------ RSF Leased 108,254 234,398 414,429 260,287 169,543 Tenant Improvements $265,789 $1,835,392 $287,380 $418,111 $676,631 Leasing Commissions $133,622 $157,976 $111,504 $68,310 $165,517 ----------- ----------- ----------- ----------- ----------- Total Renewal $399,411 $1,993,368 $398,884 $486,421 $842,148 =========== =========== =========== =========== =========== Backfill Leasing: - ------------------------------ RSF Leased 34,603 113,751 112,164 96,754 19,165 Tenant Improvements $222,803 $501,811 $1,428,067 $705,528 $182,611 Leasing Commissions $71,506 $183,426 $432,109 $248,643 $33,786 ----------- ----------- ----------- ----------- ----------- Total Backfill $294,309 $685,237 $1,860,176 $954,171 $216,397 =========== =========== =========== =========== =========== Sub-Total Revenue Maintaining: - ------------------------------ RSF Leased 142,857 348,149 526,593 357,041 188,708 Tenant Improvements $488,592 $2,337,203 $1,715,447 $1,123,639 $859,242 Leasing Commissions $205,128 $341,402 $543,613 $316,953 $199,303 ----------- ----------- ----------- ----------- ----------- Total Revenue Maintaining $693,720 $2,678,605 $2,259,060 $1,440,592 $1,058,545 =========== =========== =========== =========== =========== Revenue Enhancing - New/First Generation - ------------------------------------------ RSF Leased 91,556 57,488 105,603 11,296 135,720 Tenant Improvements $1,128,510 $706,307 $1,663,681 $111,808 $1,654,991 Leasing Commissions $370,359 $151,022 $301,057 $7,388 $955,251 ----------- ----------- ----------- ----------- ----------- Total Renewal $1,498,869 $857,329 $1,964,738 $119,196 $2,610,242 =========== =========== =========== =========== =========== Total: - ------------- RSF Leased 234,413 405,637 632,196 368,337 324,428 Tenant Improvements $1,617,102 $3,043,510 $3,379,128 $1,235,447 $2,514,233 Leasing Commissions $575,487 $492,424 $844,670 $324,341 $1,154,554 ----------- ----------- ----------- ----------- ----------- Total $2,192,589 $3,535,934 $4,223,798 $1,559,788 $3,668,787 =========== =========== =========== =========== ===========
---------------------------------------------- Three Months Ended, PSF ---------------------------------------------- 6/30/03 3/31/03 12/31/02 9/30/02 6/30/02 -------- -------- ------------------- -------- Renewal Leasing: - ------------------------------ RSF Leased 108,254 234,398 414,429 260,287 169,543 Tenant Improvements $2.46 $7.83 $0.69 $1.61 $3.99 Leasing Commissions $1.23 $0.67 $0.27 $0.26 $0.98 -------- -------- --------- -------- -------- Total Renewal $3.69 $8.50 $0.96 $1.87 $4.97 ======== ======== ========= ======== ======== Backfill Leasing: - ------------------------------ RSF Leased 34,603 113,751 112,164 96,754 19,165 Tenant Improvements $6.44 $4.41 $12.73 $7.29 $9.53 Leasing Commissions $2.07 $1.61 $3.85 $2.57 $1.76 -------- -------- --------- -------- -------- Total Backfill $8.51 $6.02 $16.58 $9.86 $11.29 ======== ======== ========= ======== ======== Sub-Total Revenue Maintaining: - ------------------------------ RSF Leased 142,857 348,149 526,593 357,041 188,708 Tenant Improvements $3.42 $6.71 $3.26 $3.15 $4.55 Leasing Commissions $1.44 $0.98 $1.03 $0.89 $1.06 -------- -------- --------- -------- -------- Total Revenue Maintaining $4.86 $7.69 $4.29 $4.03 $5.61 ======== ======== ========= ======== ======== Revenue Enhancing - New/First G Generation - ------------------------------------------ RSF Leased 91,556 57,488 105,603 11,296 135,720 Tenant Improvements $12.33 $12.29 $15.75 $9.90 $12.19 Leasing Commissions $4.05 $2.63 $2.85 $0.65 $7.04 -------- -------- --------- -------- -------- Total Renewal $16.37 $14.91 $18.60 $10.55 $19.23 ======== ======== ========= ======== ======== Total: - ------------- RSF Leased 234,413 405,637 632,196 368,337 324,428 Tenant Improvements $6.90 $7.50 $5.35 $3.35 $7.75 Leasing Commissions $2.46 $1.21 $1.34 $0.88 $3.56 -------- -------- --------- -------- -------- Total $9.35 $8.72 $6.68 $4.23 $11.31 ======== ======== ========= ======== ========
(a) These figures reflect the dollars committed for improvements under the terms of the leases executed during each period. Actual expenditures and the period in which they are expended will vary. 23
KOGER EQUITY, INC. AND SUBSIDIARIES SAME SUITE ANALYSIS - AVERAGE OVER TERM YEAR TO DATE JUNE 30, 2003 ----------------------------------------------------------------------------------- New/Backfill (a) Renewal ----------------------------------------- ----------------------------------------- RSF New Expiring Percent RSF New Expiring Percent Leased Net Net Rent Change Change Leased Net Net Rent Change Change Rent Rent -------- ------- -------- ------- ------- -------- ------- -------- ------- ------- Atlanta 28,894 $11.56 $11.87 ($0.31) -2.6% 81,230 $14.42 $9.98 $4.44 44.5% Orlando 60,627 $11.68 $13.44 ($1.76) -13.1% 28,529 $12.86 $11.89 $0.97 8.2% Jacksonville 42,846 $11.90 $14.12 ($2.22) -15.7% 91,228 $12.47 $11.65 $0.82 7.0% Houston 1,523 $6.97 $3.40 $3.57 105.0% 31,914 $11.11 $11.67 ($0.56) -4.8% St. Petersburg 25,281 $9.55 $11.56 ($2.01) -17.4% 29,640 $10.83 $10.06 $0.77 7.7% Tallahassee 7,897 $14.61 $12.90 $1.71 13.3% 30,951 $14.70 $15.21 ($0.51) -3.4% Charlotte 36,128 $10.53 $10.89 ($0.36) -3.3% 20,966 $14.30 $12.77 $1.53 12.0% Memphis 47,758 $9.65 $10.13 ($0.48) -4.7% 25,679 $13.24 $12.78 $0.46 3.6% Richmond 13,201 $13.76 $13.46 ($1.04) 2.2% 2,515 $13.00 $13.09 ($0.09) -0.7% -------- ------- -------- ------- ------- -------- ------- -------- ------- ------- Total 264,155 $11.14 $12.18 ($1.04) -8.5% 342,652 $13.07 $11.62 $1.45 12.5% ======== ======= ======== ======= ======= ======== ======= ======== ======= =======
- --------------------------------------------- Total Leasing - --------------------------------------------- RSF New Expiring Percent Leased Net Net Rent Change Change Rent - -------- ------- -------- ------- ----------- 110,124 $13.67 $10.48 $3.19 30.5% 89,156 $12.06 $12.94 ($0.89) -6.8% 134,074 $12.29 $12.44 ($0.15) -1.2% 33,437 $10.92 $11.29 ($0.37) -3.3% 54,921 $10.24 $10.75 ($0.51) -4.7% 38,848 $14.68 $14.74 ($0.06) -0.4% 57,094 $11.91 $11.58 $0.33 2.9% 73,437 $10.91 $11.06 ($0.15) -1.4% 15,716 $13.64 $13.40 $0.24 1.8% - -------- ------- -------- ------- -------- 606,807 $12.23 $11.87 $0.36 3.1% ======== ======= ======== ======= ======== (a) Analysis includes leases fully executed from 1/1/03 to 6/30/03 for buildings owned at 6/30/03. Does not include First Generation space. 24
KOGER EQUITY, INC. AND SUBSIDIARIES SAME SUITE ANALYSIS - CASH BASIS YEAR TO DATE JUNE 30, 2003 ----------------------------------------------------------------------------------- New/Backfill (a) Renewal ----------------------------------------- ----------------------------------------- RSF New Expiring Percent RSF New Expiring Percent Leased Net Net Rent Change Change Leased Net Net Rent Change Change Rent Rent -------- ------- -------- ------- ------- -------- ------- -------- ------- ------- Atlanta 28,894 $11.64 $13.24 ($1.60) -12.1% 81,230 $14.25 $10.75 $3.50 32.6% Orlando 60,627 $11.68 $14.10 ($2.42) -17.2% 28,529 $12.36 $11.85 $0.51 4.3% Jacksonville 42,846 $11.48 $13.49 ($2.01) -14.9% 91,228 $11.73 $12.03 ($0.30) -2.5% Houston 1,523 $5.29 $3.40 $1.89 55.6% 31,914 $10.87 $11.67 ($0.80) -6.9% St. Petersburg 25,281 $9.43 $11.84 ($2.41) -20.4% 29,640 $10.40 $10.90 ($0.50) -4.6% Tallahassee 7,897 $14.47 $13.35 $1.12 8.4% 30,951 $13.66 $15.80 ($2.14) -13.5% Charlotte 36,128 $9.95 $13.70 ($3.75) -27.4% 20,966 $13.66 $14.55 ($0.89) -6.1% Memphis 47,758 $6.73 $10.46 ($3.73) -35.7% 25,679 $12.42 $14.53 ($2.11) -14.5% Richmond 13,201 $12.89 $14.10 ($1.21) -8.6% 2,515 $12.15 $13.39 ($1.24) -9.3% -------- ------- -------- ------- ------- -------- ------- -------- ------- ------- Total 264,155 $10.40 $12.89 ($2.49) -19.3% 342,652 $12.53 $12.27 $0.26 2.1% ======== ======= ======== ======= ======= ======== ======= ======== ======= =======
- ----------------------------------------- Total Leasing - ----------------------------------------- RSF New Expiring Percent Leased Net Net Rent Change Change Rent - -------- ------- -------- ------- ------- 110,124 $13.57 $11.40 $2.16 19.0% 89,156 $11.90 $13.38 ($1.48) -11.1% 134,074 $11.65 $12.50 ($0.85) -6.8% 33,437 $10.62 $11.29 ($0.68) -6.0% 54,921 $9.95 $11.33 ($1.38) -12.2% 38,848 $13.82 $15.30 ($1.48) -9.7% 57,094 $11.31 $14.01 ($2.70) -19.3% 73,437 $8.72 $11.88 ($3.16) -26.6% 15,716 $12.77 $13.99 ($1.21) -8.7% - -------- ------- -------- ------- ------- 606,807 $11.61 $12.54 ($0.94) -7.5% ======== ======= ======== ======= ======= (a) Analysis includes leases fully executed from 1/1/03 to 6/30/03 for buildings owned at 6/30/03. Does not include First Generation space. 25
KOGER EQUITY, INC. AND SUBSIDIARIES SPECIAL ITEMS INCLUDED IN QUARTER'S RESULTS In Thousands, Except Per Share Data - -------------------------------------------------------------------------------------------------- 6/30/2003 3/31/2003 ----------------------- Lease Cancellation Fees 427 705 Straight Line Rent Catchup For All Leases Less Than 5,000 RSF - 665 Expense Reimbursement Catchup For 2002 - 427 Compensation Expense Accrued Related To Options (177) (177) Write Off of Development Pursuit Costs & Other Assets - (247) Asset Management Fees from Crocker Realty Trust 67 194 Leasing Commissions from Terminated A/P Knight Contract 59 - Partial Tenant Default Settlement From Sold Assets 289 - ----------------------- Total 665 1,567 ======================= Weighted average common shares/units outstanding - diluted 21,382 21,327 ======================= Per share/unit - diluted: FFO Impact $0.03 $0.07 =======================
EX-99 4 a4448835ex99b.txt EXHIBIT 99(B) PRESS RELEASE Exhibit 99(b) Koger Enters Dallas Market with the Acquisition of Two Properties BOCA RATON, Fla.--(BUSINESS WIRE)--Aug. 4, 2003--Koger Equity, Inc. (NYSE:KE) today announced that it has signed a definitive agreement with State Teachers Retirement System of Ohio to acquire the Rosemeade Building and CIGNA Plaza in Dallas, Texas for $33.15 million in cash. The buildings encompass approximately 280,000 square feet of rentable space and are currently 96% leased. Based on the in-place net operating income, Koger will purchase the properties at a capitalization rate of approximately 13.4%. The Company currently anticipates financing the two properties with proceeds from a 10-year fixed rate secured mortgage loan of approximately 65% of the purchase price with the remainder drawn against the Company's secured line of credit. The Company expects to close the acquisition in late August. The Company may initially fund the entire acquisition on the Company's secured line of credit, if the secured mortgage loan cannot close simultaneously with the acquisition closing date. The Rosemeade Building is located at the intersection of the George Bush Turnpike and the Dallas North Tollway in the highly desirable Far North Dallas submarket. CIGNA Plaza is located at the intersection of State Highway 114 and the George Bush Turnpike, in the heart of Las Colinas and adjacent to the Dallas/Ft. Worth International Airport. Tom Crocker, CEO, said, "We are pleased to enter the Dallas market with the acquisition of these strategically located Class A properties. This transaction furthers our strategy of acquiring quality product in highly desirable locations within major cities in the Southeastern United States and Texas. The limited exposure to near-term rollover will allow these properties to weather the current weakness in the Dallas office market. We have confidence in the long-term viability of this market and will consider other acquisition opportunities as they surface." Estimates and certain other matters discussed in this press release may be, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Koger Equity, Inc. believes the expectations reflected in such forward-looking statements are based on reasonable assumptions; there can be no assurance that its expectations will be attained. Certain factors that could cause actual results to differ materially from the Company's expectations are set forth as risk factors in the company's SEC reports and filings, including its annual report on Form 10-K. Included among these factors are changes in general economic conditions, including changes in the economic conditions affecting industries in which its principal tenants compete; its ability to timely lease or re-lease space at current or anticipated rents to creditworthy tenants; its ability to achieve economies of scale over time; the demand for tenant services beyond those traditionally provided by landlords; changes in interest rates; changes in operating costs; its ability to attract and retain high-quality personnel at a reasonable cost in a highly competitive labor environment; future demand for its debt and equity securities; its ability to refinance its debt on reasonable terms at maturity; and its ability to complete current and future development projects on schedule and on budget. Many of these factors are beyond the Company's ability to control or predict. Forward-looking statements are not guarantees of performance. For forward-looking statements contained or incorporated by reference herein, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events. Koger Equity, Inc. owns and operates 124 office buildings, containing 8.93 million rentable square feet, primarily located within 16 suburban office projects in nine cities in the Southeastern United States and Houston, Texas. Additional information about Koger is available upon request to Investor Relations, 225 NE Mizner Blvd., Suite 200, Boca Raton, Florida 33432-4079, or call 1-800-850-2037, or visit Koger's website at www.koger.com. CONTACT: Koger Equity, Inc. Tom Brockwell, 561-395-9666 -----END PRIVACY-ENHANCED MESSAGE-----