UNITED STATES
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): October 29, 2012
Post Properties, Inc.
Post Apartment Homes, L.P.
(Exact name of registrant as specified in its charter)
Georgia
Georgia
(State or other jurisdiction of incorporation)
1-12080
0-28226
(Commission File Number)
58-1550675
58-2053632
(IRS Employer Identification Number)
4401 Northside Parkway, Suite 800, Atlanta, Georgia 30327
(Address of principal executive offices)
Registrants telephone number, including area code (404) 846-5000
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the | |
Exchange Act (17 CFR 240.14d-2(b)) | ||
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the | |
Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition.
On October 29, 2012, Post Properties, Inc. and Post Apartment Homes, L.P. (collectively referred to as the Registrants), issued an Earnings Release and Supplemental Financial Data announcing their financial results for the quarterly period ended September 30, 2012. The Earnings Release and Supplemental Financial Data contain information about the Registrants financial condition and results of operations for the quarterly period ended September 30, 2012. A copy of the Earnings Release is attached hereto as Exhibit 99.1 and is incorporated by reference herein in its entirety. A copy of the Supplemental Financial Data is attached hereto as Exhibit 99.2 and is incorporated by reference herein in its entirety.
Item 9.01. Financial Statements and Exhibits.
99.1 |
Earnings Release | |
99.2 |
Supplemental Financial Data |
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 hereunto duly authorized.
Dated: October 30, 2012
POST PROPERTIES, INC. | ||||
By: |
/s/ David P. Stockert |
|||
David P. Stockert |
||||
President and |
||||
Chief Executive Officer |
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 hereunto duly authorized.
Dated: October 30, 2012
POST APARTMENT HOMES, L.P. | ||||
By: |
POST GP HOLDINGS, INC., | |||
as General Partner |
||||
By: |
/s/ David P. Stockert |
|||
David P. Stockert |
||||
President and |
||||
Chief Executive Officer |
EXHIBIT INDEX
Exhibit |
Description | |
99.1 |
Earnings Release | |
99.2 |
Supplemental Financial Data |
Exhibit 99.1
Contact: | Chris Papa Post Properties, Inc. (404) 846-5028 |
Post Properties Announces Third Quarter 2012 Earnings and
Development of Post Soho Square in Tampa, Florida
Investor/Analyst Conference Call Scheduled for Wednesday, October 31 at 12:00 noon ET
ATLANTA, Monday, October 29, 2012 Post Properties, Inc. (NYSE: PPS) announced today net income available to common shareholders of $21.3 million, or $0.39 per diluted share, for the third quarter of 2012, compared to net income of $7.9 million, or $0.15 per diluted share, for the third quarter of 2011.
Net income available to common shareholders for the nine months ended September 30, 2012, was $62.3 million, or $1.15 per diluted share, compared to net income of $16.3 million, or $0.32 per diluted share, for the nine months ended September 30, 2011.
The Companys net income available to common shareholders for the nine months ended September 30, 2012 included other income of $0.9 million relating primarily to a construction litigation settlement and a gain of $6.1 million on the sale of an asset. The Companys net income available to common shareholders for the nine months ended September 30, 2011 included a $0.4 million gain on the sale of a technology investment and $1.8 million of costs associated with the Companys redemption of preferred stock.
Funds From Operations
The Company uses the National Association of Real Estate Investment Trusts (NAREIT) definition of Funds from Operations (FFO) as an operating measure of the Companys financial performance. A reconciliation of FFO to GAAP net income is included in the financial data (Table 1) accompanying this press release.
FFO for the third quarter of 2012 was $41.6 million, or $0.76 per diluted share, compared to $26.7 million, or $0.52 per diluted share, for the third quarter of 2011.
FFO for the nine months ended September 30, 2012, was $115.5 million, or $2.13 per diluted share, compared to $72.8 million, or $1.44 per diluted share, for the nine months ended September 30, 2011. The Companys reported FFO for the nine months ended September 30, 2012, included the $0.9 million of other income discussed above, or $0.02 per diluted share. The Companys reported FFO for the nine months ended September 30, 2011, included costs related to the redemption of preferred stock, offset by the technology sale gain discussed above, totaling a net reduction to FFO of $1.3 million, or $0.03 per diluted share.
Said Dave Stockert, Posts CEO, Our business continues to be robust, across-the-board. Core funds from operations grew on a per-share basis in the third quarter by more than 20%. We put up another strong quarter of same-store operating results, closed a significant number of condominium sales, and commenced another apartment development that should create value, while complementing our high-quality portfolio. Finally, we were delighted that both of the major ratings agencies have now upgraded our corporate credit ratings to reflect the work weve done to strengthen the balance sheet.
Same Store Community Data
Average economic occupancy at the Companys 50 same store communities, containing 18,114 apartment units, was 96.6% and 96.4% for the third quarter of 2012 and 2011, respectively.
Total revenues for the same store communities increased 6.7% and total operating expenses increased 3.2% during the third quarter of 2012, compared to the third quarter of 2011, resulting in a 9.0% increase in same store net operating income (NOI). The average monthly rental rate per unit increased 6.4% during the third quarter of 2012, compared to the third quarter of 2011.
On a sequential basis, total revenues for the same store communities increased 2.7% and total operating expenses increased 3.6%, producing a 2.1% increase in same store NOI for the third quarter of 2012, compared to the second quarter of 2012. On a sequential basis, the average monthly rental rate per unit increased 2.2%. For the third quarter of 2012, average economic occupancy at the same store communities was 96.6%, compared to 96.1% for the second quarter of 2012.
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For the nine months ended September 30, 2012, average economic occupancy at the Companys same store communities was 96.2%, compared to 95.5% for the nine months ended September 30, 2011.
Total revenues for the same store communities increased 7.4% and total operating expenses increased 3.4% during the first nine months of 2012, compared to the first nine months of 2011, resulting in a 10.1% increase in same store NOI. The average monthly rental rate per unit increased 6.4% for the nine months ended September 30, 2012, compared to the nine months ended September 30, 2011.
Same store NOI is a supplemental non-GAAP financial measure. A reconciliation of same store NOI to the comparable GAAP financial measure is included in the financial data (Table 2) accompanying this press release. Information on same store NOI and average rental rate per unit by geographic market is also included in the financial data (Table 3) accompanying this press release.
Development Activity
The Company today announced the development of its Post Soho Square apartment community located in the Hyde Park submarket of Tampa, Florida. Post Soho Square is planned to consist of 231 apartment units with an average unit size of approximately 880 square feet and approximately 10,556 square feet of retail space. The community is expected to have a total estimated development cost of approximately $39.8 million. The Company currently expects the stabilized yield on the project will be approximately 6.25%, after a 3% management fee and $300 per unit reserve, and based on current market rents, without trending. The Company anticipates that first apartment unit deliveries will occur in the first quarter of 2014.
In September and October 2012, the Company began leasing units at its Post South Lamar apartment community located in Austin, Texas and at the third phase of its Post Midtown Square® apartment community in Houston, Texas. As of October 26, 2012, Post South Lamar and Post Midtown Square® Phase III were 11.7% and 3.2% leased, respectively.
In the aggregate, the Company has 2,046 units in seven apartment communities, and approximately 45,085 square feet of retail space, under development or in lease-up with a total estimated cost of $340.2 million. The Company currently expects to utilize available borrowings under its unsecured bank credit facilities, or other indebtedness, as well as net proceeds from its on-going condominium sales and its at-the-market common equity sales program to fund future estimated construction expenditures.
Financing Activity
Corporate Credit Ratings
In September and October 2012, Standard and Poors Ratings Services and Moodys Investors Service raised the Companys corporate credit and senior unsecured credit ratings to BBB/Baa2, from BBB-/Baa3, respectively, and revised the Companys outlook to stable, from positive.
As a result of these ratings actions, effective as of October 1, 2012, the interest rate on the Companys $300 million unsecured bank term loan was reduced by 0.20%, to LIBOR plus 1.70%. After considering the interest rate swaps that hedge this debt, the unsecured term loan now bears interest at a blended fixed rate of approximately 3.24% (subject to any further adjustment based on subsequent changes in the Companys credit ratings). The interest rates on the Companys combined $330 million unsecured revolving lines of credit were also reduced as of that date by 0.175%, to LIBOR plus 1.225%, and the annual facility fee on the syndicated revolving line of credit was reduced as of that date by 0.075%, to 0.225% per annum.
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Leverage, Line and Term Loan Capacity
Total debt and preferred equity as a percentage of undepreciated real estate assets (adjusted for joint venture partners share of real estate assets and debt) was 36.8% at September 30, 2012.
On October 10, 2012, the Company repaid $53.0 million of secured mortgage indebtedness that became open for prepayment at par. The stated interest rate on the note was 5.50%, and it was scheduled to mature in January 2013.
As of October 26, 2012, the Company had cash and cash equivalents of $3.9 million. Additionally, the Company had outstanding borrowings of $8.3 million and had letters of credit totaling $0.6 million under its combined $330 million unsecured lines of credit.
Computations of debt ratios and reconciliations of the ratios to the appropriate GAAP measures in the Companys financial statements are included in the financial data (Table 4) accompanying this press release.
At-the-Market Common Equity Activity
During the third quarter of 2012, the Company completed the sell-out of its initial at-the-market (ATM) common equity program that provided for the sale of up to 4 million shares of common stock. The Company also has available a second ATM common equity program that provides for the sale of up to an additional 4 million shares of common stock. As of October 26, 2012, no shares have been issued under that program. The Company expects to continue to use its ATM programs as an additional source of capital and liquidity, to maintain the strength of its balance sheet and to fund its planned investment activities. Sales under these programs are dependent upon a variety of factors, including, among others, market conditions, the trading price of the Companys common stock, the Companys liquidity position and the potential use of proceeds.
During the third quarter of 2012, the Company sold 136,500 shares under the initial ATM program, at an average gross price of $51.24 per share, producing net proceeds of $6.8 million. Since inception of this program, the Company has sold 4,000,000 shares, at an average gross price of $41.48 per share, producing net proceeds of $162.2 million.
Condominium Activity
During the third quarter of 2012, the Company closed 24 condominium units at its Austin and Atlanta condominium projects for aggregate gross revenue of $23.5 million. As of October 26, 2012, the Company has, in the aggregate, closed 188 units at the Austin and Atlanta condominium projects and has 22 units under contract. There can be no assurance that condominium units under contract will close.
The Company recognized net gains in FFO of $10.3 million, or $0.19 per diluted share, from condominium sales activities during the third quarter of 2012, compared to $2.6 million, or $0.05 per diluted share, during the third quarter of 2011.
2012 Outlook
The estimates and assumptions presented below are forward looking and are based on the Companys future view of the apartment and condominium markets and of general economic conditions, as well as other risks outlined below under the caption Forward-Looking Statements. There can be no assurance that the Companys actual results will not differ materially from the estimates set forth below. The Company assumes no obligation to update this guidance in the future.
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Based on its revised outlook, the Company anticipates that FFO for the full year 2012 will be in the range set forth below, as compared to its previous outlook issued in its July 2012 earnings release. The tables below reflect anticipated net gains from condominium sales (for purposes of this discussion, Condo FFO) and FFO before Condo FFO (for purposes of this discussion, Core FFO).
Current Outlook |
Previously Issued Outlook |
|||||||
Core FFO |
$ | 2.22 - $2.24 | $ | 2.14 - $2.20 | ||||
Condo FFO |
$ | 0.55 - $0.57 | $ | 0.36 - $0.40 | ||||
FFO |
$ | 2.77 - $2.81 | $ | 2.50 - $2.60 |
Same Store Assumptions |
Current Outlook |
Previously Issued Outlook |
||||||
Revenue |
6.90% - 7.10% | 6.25% - 6.75% | ||||||
Operating expenses |
4.60% - 4.80% | 4.25% - 4.75% | ||||||
Net operating income (NOI) |
8.20% - 8.60% | 7.20% - 8.20% |
Supplemental Financial Data
The Company also produces Supplemental Financial Data that includes detailed information regarding the Companys operating results, investment activity, financing activity, balance sheet and properties. This Supplemental Financial Data is considered an integral part of this earnings release and is available on the Companys website. The Companys Earnings Release and the Supplemental Financial Data are available through the For Investors/Financial Reports/Quarterly and Other Reports section of the Companys website at www.postproperties.com.
The ability to access the attachments on the Companys website requires the Adobe Acrobat Reader, which may be downloaded at http://get.adobe.com/reader/.
Non-GAAP Financial Measures and Other Defined Terms
The Company uses certain non-GAAP financial measures and other defined terms in this press release and in its Supplemental Financial Data available on the Companys website. The non-GAAP financial measures include FFO, Adjusted Funds from Operations (AFFO), net operating income, same store capital expenditures, and certain debt statistics and ratios. The definitions of these non-GAAP financial measures are summarized below and on page 19 of the Supplemental Financial Data. The Company believes that these measures are helpful to investors in measuring financial performance and/or liquidity and comparing such performance and/or liquidity to other REITs.
Funds from Operations The Company uses FFO as an operating measure. The Company uses the NAREIT definition of FFO. FFO is defined by NAREIT to mean net income (loss) available to common shareholders determined in accordance with GAAP, excluding gains (or losses) from extraordinary items and sales of depreciable operating property, plus depreciation and amortization of real estate assets, and after adjustment for unconsolidated partnerships and joint ventures all determined on a consistent basis in accordance with GAAP. FFO presented in the Companys press release and Supplemental Financial Data is not necessarily comparable to FFO presented by other real estate companies because not all real estate companies use the same definition. The Companys FFO is comparable to the FFO of real estate companies that use the current NAREIT definition.
Accounting for real estate assets using historical cost accounting under GAAP assumes that the value of real estate assets diminishes predictably over time. NAREIT stated in its April 2002 White Paper on Funds from Operations that since real estate asset values have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. As a result, the concept of FFO was created by NAREIT for the REIT industry to provide an alternate measure. Since the Company agrees with the concept of FFO and appreciates the reasons surrounding its creation, the Company believes that FFO is an important supplemental measure of operating performance. In addition, since most equity REITs provide FFO information to the investment community, the Company believes that FFO is a useful supplemental measure for comparing the Companys results to those of other equity REITs. The Company believes that the line on its consolidated statement of operations entitled net income available to common shareholders is the most directly comparable GAAP measure to FFO.
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Adjusted Funds From Operations The Company also uses adjusted funds from operations (AFFO) as an operating measure. AFFO is defined as FFO less operating capital expenditures and after adjusting for the impact of non-cash straight-line, long-term ground lease expense, non-cash impairment charges, debt extinguishment gains (losses) and preferred stock redemption costs. The Company believes that AFFO is an important supplemental measure of operating performance for an equity REIT because it provides investors with an indication of the REITs ability to fund its operating capital expenditures through earnings. In addition, since most equity REITs provide AFFO information to the investment community, the Company believes that AFFO is a useful supplemental measure for comparing the Company to other equity REITs. The Company believes that the line on its consolidated statement of operations entitled net income available to common shareholders is the most directly comparable GAAP measure to AFFO.
Property Net Operating Income (NOI) The Company uses property NOI, including same store NOI and same store NOI by market, as an operating measure. NOI is defined as rental and other revenues from real estate operations less total property and maintenance expenses from real estate operations (exclusive of depreciation and amortization). The Company believes that NOI is an important supplemental measure of operating performance for a REITs operating real estate because it provides a measure of the core operations, rather than factoring in depreciation and amortization, financing costs and general and administrative expenses generally incurred at the corporate level. This measure is particularly useful, in the opinion of the Company, in evaluating the performance of geographic operations, same store groupings and individual properties. Additionally, the Company believes that NOI, as defined, is a widely accepted measure of comparative operating performance in the real estate investment community. The Company believes that the line on its consolidated statement of operations entitled net income is the most directly comparable GAAP measure to NOI.
Same Store Capital Expenditures The Company uses same store annually recurring and periodically recurring capital expenditures as cash flow measures. Same store annually recurring and periodically recurring capital expenditures are supplemental non-GAAP financial measures. The Company believes that same store annually recurring and periodically recurring capital expenditures are important indicators of the costs incurred by the Company in maintaining its same store communities on an ongoing basis. The corresponding GAAP measures include information with respect to the Companys other operating segments consisting of communities stabilized in the prior year, lease-up communities, rehabilitation properties, sold properties and commercial properties in addition to same store information. Therefore, the Company believes that the Companys presentation of same store annually recurring and periodically recurring capital expenditures is necessary to demonstrate same store replacement costs over time. The Company believes that the most directly comparable GAAP measure to same store annually recurring and periodically recurring capital expenditures is the line on the Companys consolidated statements of cash flows entitled property capital expenditures, which also includes revenue generating capital expenditures.
Debt Statistics and Debt Ratios The Company uses a number of debt statistics and ratios as supplemental measures of liquidity. The numerator and/or the denominator of certain of these statistics and/or ratios include non-GAAP financial measures that have been reconciled to the most directly comparable GAAP financial measure. These debt statistics and ratios include: (1) interest coverage ratios; (2) fixed charge coverage ratios; (3) total debt as a percentage of undepreciated real estate assets (adjusted for joint venture partners share of debt); (4) total debt plus preferred equity as a percentage of undepreciated real estate assets (adjusted for joint venture partners share of debt); (5) a ratio of consolidated debt to total assets; (6) a ratio of secured debt to total assets; (7) a ratio of total unencumbered assets to unsecured debt; (8) a ratio of consolidated income available for debt service to annual debt service charge; and (9) a debt to annualized income available for debt service ratio. A number of these debt statistics and ratios are derived from covenants found in the Companys debt agreements, including, among others, the Companys senior unsecured notes. In addition, the Company presents these measures because the degree of leverage could affect the Companys ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes. The Company uses these measures internally as an indicator of liquidity, and the Company believes that these measures are also utilized by the investment and analyst communities to better understand the Companys liquidity.
The Company uses income available for debt service to calculate certain debt ratios and statistics. Income available for debt service is defined as net income (loss) before interest, taxes, depreciation, amortization, gains on sales of real estate assets, non-cash impairment charges and other non-cash income and expenses. Income available for debt service is a supplemental measure of operating performance that does not represent and should not be considered as an alternative to net income or cash flow from operating activities as determined under GAAP, and the Companys calculation thereof may not be comparable to similar measures reported by other companies, including EBITDA or Adjusted EBITDA.
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Property Operating Statistics The Company uses average economic occupancy, gross turnover, net turnover and percentage increases in rent for new and renewed leases as statistical measures of property operating performance. The Company defines average economic occupancy as gross potential rent less vacancy losses, model expenses and bad debt expenses divided by gross potential rent for the period, expressed as a percentage. Gross turnover is defined as the percentage of leases expiring during the period that are not renewed by the existing residents. Net turnover is defined as gross turnover decreased by the percentage of expiring leases where the residents transfer to a new apartment unit in the same community or in another Post® community. The percentage increases in rent for new and renewed leases are calculated using the respective new or renewed rental rate as of the date of a new lease, as compared with the previous rental rate on that same unit.
Conference Call Information
The Company will hold its quarterly conference call on Wednesday, October 31, at 12:00 noon ET. The revised telephone numbers are 800-533-7954 for U.S. and Canada callers and 785-830-1924 for international callers. The access code is 7431207. The conference call will be open to the public and can be listened to live on Posts website at www.postproperties.com under For Investors/Event Calendar. The replay will begin at 2:00 p.m. ET on Wednesday, October 31, and will be available until Tuesday, November 6, at 11:59 p.m. ET. The telephone numbers for the replay are 888-203-1112 for U.S. and Canada callers and 719-457-0820 for international callers. The access code for the replay is 7431207. A replay of the call also will be archived on Posts website under For Investors/Audio Archives.
About Post
Post Properties, founded more than 40 years ago, is a leading developer and operator of upscale multifamily communities. The Companys mission is delivering superior satisfaction and value to its residents, associates, and investors, with a vision of being the first choice in quality multifamily living. Operating as a real estate investment trust (REIT), the Company focuses on developing and managing Post® branded resort-style garden and high density urban apartments. Post Properties is headquartered in Atlanta, Georgia, and has operations in ten markets across the country.
Post Properties has interests in 22,218 apartment units in 60 communities, including 1,471 apartment units in four communities held in unconsolidated entities and 2,046 apartment units in seven communities currently under development or in lease-up. The Company is also selling luxury for-sale condominium homes in two communities through a taxable REIT subsidiary.
Forward-Looking Statements
Certain statements made in this press release and other written or oral statements made by or on behalf of the Company, may constitute forward-looking statements within the meaning of the federal securities laws. Statements regarding future events and developments and the Companys future performance, as well as managements expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. Examples of such statements in this press release include, expectations regarding apartment market conditions, expectations regarding use of proceeds from unsecured bank credit facilities, expectations regarding future operating conditions, including the Companys current outlook as to expected funds from operations, revenue, operating expenses and net operating income, anticipated development activities (including projected construction expenditures and timing), expectations regarding the for-sale condominium business, and expectations regarding offerings of the Companys common stock and the use of proceeds thereof. All forward-looking statements are subject to certain risks and uncertainties that could cause actual events to differ materially from those projected. Management believes that these forward-looking statements are reasonable; however, you should not place undue reliance on such statements. These statements are based on current expectations and speak only as of the date of such statements. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information or otherwise.
The following are some of the factors that could cause the Companys actual results and its expectations to differ materially from those described in the Companys forward-looking statements: the success of the Companys business strategies discussed in its Annual Report on Form 10-K for the year ended December 31, 2011 and in subsequent filings with the SEC; conditions affecting ownership of residential real estate and general conditions in the multi-family residential real estate market; uncertainties associated with the Companys real estate development and construction; uncertainties associated with the timing and amount of apartment community sales; exposure to economic and other competitive factors due to market concentration; future local and national economic conditions, including changes in job growth, interest rates, the availability
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of mortgage and other financing and related factors; the Companys ability to generate sufficient cash flows to make required payments associated with its debt financing; the effects of the Companys leverage on its risk of default and debt service requirements; the impact of a downgrade in the credit rating of the Companys securities; the effects of a default by the Company or its subsidiaries on an obligation to repay outstanding indebtedness, including cross-defaults and cross-acceleration under other indebtedness; the effects of covenants of the Companys or its subsidiaries mortgage indebtedness on operational flexibility and default risks; the effects of any decision by the government to eliminate Fannie Mae or Freddie Mac or reduce government support for apartment mortgage loans; the Companys ability to maintain its current dividend level; uncertainties associated with the Companys condominium for-sale housing business, including the timing and volume of condominium sales; the impact of any additional charges the Company may be required to record in the future related to any impairment in the carrying value of its assets; the impact of competition on the Companys business, including competition for residents in the Companys apartment communities and buyers of the Companys for-sale condominium homes and development locations; the Companys ability to compete for limited investment opportunities; the effects of changing interest rates and effectiveness of interest rate hedging contracts; the success of the Companys acquired apartment communities; the Companys ability to succeed in new markets; the costs associated with compliance with laws requiring access to the Companys properties by persons with disabilities; the impact of the Companys ongoing litigation with the U.S. Department of Justice regarding the Americans with Disabilities Act and the Fair Housing Act as well as the impact of other litigation; the effects of losses from natural catastrophes in excess of insurance coverage; uncertainties associated with environmental and other regulatory matters; the costs associated with moisture infiltration and resulting mold remediation; the Companys ability to control joint ventures, properties in which it has joint ownership and corporations and limited partnership in which it has partial interests; the Companys ability to renew leases or relet units as leases expire; the Companys ability to continue to qualify as a REIT under the Internal Revenue Code; and the effects of changes in accounting policies and other regulatory matters detailed in the Companys filings with the Securities and Exchange Commission; increased costs arising from health care reform; any breach of the Companys privacy or information security systems. Other important risk factors regarding the Company are included under the caption Risk Factors in the Companys Annual Report on Form 10-K for the year ended December 31, 2011 and may be discussed in subsequent filings with the SEC. The risk factors discussed in Form 10-K under the caption Risk Factors are specifically incorporated by reference into this press release.
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Financial Highlights
(Unaudited; in thousands, except per share and unit amounts)
Three months ended September 30, |
Nine months ended September 30, |
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2012 | 2011 | 2012 | 2011 | |||||||||||||
OPERATING DATA |
||||||||||||||||
Total revenues |
$ | 86,374 | $ | 78,612 | $ | 248,810 | $ | 227,567 | ||||||||
Net income available to common shareholders |
$ | 21,285 | $ | 7,872 | $ | 62,320 | $ | 16,275 | ||||||||
Funds from operations available to common shareholders and unitholders (Table 1) |
$ | 41,644 | $ | 26,735 | $ | 115,521 | $ | 72,753 | ||||||||
Weighted average shares outstanding - diluted |
54,392 | 51,053 | 54,001 | 50,259 | ||||||||||||
Weighted average shares and units outstanding - diluted |
54,536 | 51,215 | 54,149 | 50,426 | ||||||||||||
PER COMMON SHARE DATA - DILUTED |
||||||||||||||||
Net income available to common shareholders |
$ | 0.39 | $ | 0.15 | $ | 1.15 | $ | 0.32 | ||||||||
Funds from operations available to common shareholders and unitholders (Table 1) (1) |
$ | 0.76 | $ | 0.52 | $ | 2.13 | $ | 1.44 | ||||||||
Dividends declared |
$ | 0.25 | $ | 0.22 | $ | 0.72 | $ | 0.62 |
1) | Funds from operations available to common shareholders and unitholders per share was computed using weighted average shares and units outstanding, including the impact of dilutive securities totaling 277 and 402 for the three months and 340 and 397 for the nine months ended September 30, 2012 and 2011, respectively. Additionally, diluted weighted average shares and units included the impact of non-vested shares and units totaling 129 and 164 for the three months and 126 and 162 for the nine months ended September 30, 2012 and 2011, respectively, for the computation of FFO per share. Such non-vested shares and units are considered in the income per share computations under GAAP using the two-class method. |
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Table 1
Reconciliation of Net Income Available to Common Shareholders to
Funds From Operations Available to Common Shareholders and Unitholders
(Unaudited; in thousands, except per share amounts)
Three months ended September 30, |
Nine months ended September 30, |
|||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net income available to common shareholders |
$ | 21,285 | $ | 7,872 | $ | 62,320 | $ | 16,275 | ||||||||
Noncontrolling interests - Operating Partnership |
60 | 25 | 175 | 54 | ||||||||||||
Depreciation on consolidated real estate assets, net |
20,012 | 18,475 | 58,171 | 55,340 | ||||||||||||
Depreciation on real estate assets held in unconsolidated entities |
287 | 363 | 910 | 1,084 | ||||||||||||
Gains on sales of depreciable real estate assets - unconsolidated entities |
| | (6,055 | ) | | |||||||||||
|
|
|
|
|
|
|
|
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Funds from operations available to common shareholders and unitholders |
$ | 41,644 | $ | 26,735 | $ | 115,521 | $ | 72,753 | ||||||||
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|
|
|
|
|
|
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Funds from operations - per share and unit - diluted (1) |
$ | 0.76 | $ | 0.52 | $ | 2.13 | $ | 1.44 | ||||||||
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|
|
|
|
|
|
|||||||||
Weighted average shares and units outstanding - diluted (1) |
54,665 | 51,379 | 54,275 | 50,588 | ||||||||||||
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|
|
1) | Diluted weighted average shares and units include the impact of dilutive securities totaling 277 and 402 for the three months and 340 and 397 for the nine months ended September 30, 2012 and 2011, respectively. Additionally, diluted weighted average shares and units included the impact of non-vested shares and units totaling 129 and 164 for the three months and 126 and 162 for the nine months ended September 30, 2012 and 2011, respectively, for the computation of FFO per share. Such non-vested shares and units are considered in the income per share computations under GAAP using the two-class method. |
-9-
Table 2
Reconciliation of Same Store Net Operating Income (NOI) to GAAP Net Income
(Unaudited; In thousands)
Three months ended | Nine months ended | |||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
June 30, 2012 |
September 30, 2012 |
September 30, 2011 |
||||||||||||||||
Total same store NOI |
$ | 47,185 | $ | 43,271 | $ | 46,202 | $ | 138,453 | $ | 125,748 | ||||||||||
Property NOI from other operating segments |
1,639 | 480 | 521 | 2,511 | 692 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Consolidated property NOI |
48,824 | 43,751 | 46,723 | 140,964 | 126,440 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Add (subtract): |
||||||||||||||||||||
Interest income |
20 | 374 | 288 | 359 | 982 | |||||||||||||||
Other revenues |
209 | 243 | 206 | 637 | 686 | |||||||||||||||
Depreciation |
(20,334 | ) | (18,823 | ) | (19,497 | ) | (59,172 | ) | (56,383 | ) | ||||||||||
Interest expense |
(11,816 | ) | (14,207 | ) | (11,103 | ) | (34,564 | ) | (43,119 | ) | ||||||||||
Amortization of deferred financing costs |
(667 | ) | (717 | ) | (698 | ) | (2,026 | ) | (2,085 | ) | ||||||||||
General and administrative |
(3,763 | ) | (3,970 | ) | (3,883 | ) | (11,931 | ) | (12,332 | ) | ||||||||||
Investment and development |
(203 | ) | (239 | ) | (322 | ) | (1,005 | ) | (1,013 | ) | ||||||||||
Other investment costs |
(547 | ) | (329 | ) | (306 | ) | (1,159 | ) | (1,278 | ) | ||||||||||
Gains on condominium sales activities, net |
10,261 | 2,581 | 8,530 | 25,695 | 8,757 | |||||||||||||||
Equity in income of unconsolidated real estate entities, net |
475 | 235 | 495 | 7,416 | 790 | |||||||||||||||
Other income (expense), net |
(137 | ) | (71 | ) | 737 | 444 | 230 | |||||||||||||
Net loss on extinguishment of indebtedness |
| | | (301 | ) | | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net income |
$ | 22,322 | $ | 8,828 | $ | 21,170 | $ | 65,357 | $ | 21,675 | ||||||||||
|
|
|
|
|
|
|
|
|
|
-10-
Table 3
Same Store Net Operating Income (NOI) and Average Rental Rate per Unit by Market
(In thousands)
Three months ended | Q3 12 vs. Q3 11 % Change |
Q3
12 vs. Q2 12 % Change |
Q3
12 % Same Store NOI |
|||||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
June 30, 2012 |
||||||||||||||||||||||
Rental and other revenues |
||||||||||||||||||||||||
Atlanta |
$ | 20,982 | $ | 19,655 | $ | 20,320 | 6.8 | % | 3.3 | % | ||||||||||||||
Washington, D.C. |
13,283 | 12,837 | 13,108 | 3.5 | % | 1.3 | % | |||||||||||||||||
Dallas |
16,261 | 15,101 | 15,720 | 7.7 | % | 3.4 | % | |||||||||||||||||
Tampa |
8,851 | 8,226 | 8,628 | 7.6 | % | 2.6 | % | |||||||||||||||||
Charlotte |
5,013 | 4,594 | 4,845 | 9.1 | % | 3.5 | % | |||||||||||||||||
New York |
3,709 | 3,580 | 3,668 | 3.6 | % | 1.1 | % | |||||||||||||||||
Houston |
3,446 | 3,135 | 3,359 | 9.9 | % | 2.6 | % | |||||||||||||||||
Orlando |
2,777 | 2,583 | 2,711 | 7.5 | % | 2.4 | % | |||||||||||||||||
Austin |
2,845 | 2,619 | 2,770 | 8.6 | % | 2.7 | % | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Total rental and other revenues |
77,167 | 72,330 | 75,129 | 6.7 | % | 2.7 | % | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Property operating and maintenance expenses (exclusive of depreciation and amortization) |
||||||||||||||||||||||||
Atlanta |
8,569 | 7,963 | 8,087 | 7.6 | % | 6.0 | % | |||||||||||||||||
Washington, D.C. |
4,157 | 4,384 | 3,946 | (5.2 | )% | 5.3 | % | |||||||||||||||||
Dallas |
6,996 | 6,691 | 6,655 | 4.6 | % | 5.1 | % | |||||||||||||||||
Tampa |
3,275 | 3,153 | 3,257 | 3.9 | % | 0.6 | % | |||||||||||||||||
Charlotte |
1,675 | 1,729 | 1,742 | (3.1 | )% | (3.8 | )% | |||||||||||||||||
New York |
1,612 | 1,561 | 1,607 | 3.3 | % | 0.3 | % | |||||||||||||||||
Houston |
1,407 | 1,388 | 1,439 | 1.4 | % | (2.2 | )% | |||||||||||||||||
Orlando |
1,042 | 1,028 | 1,001 | 1.4 | % | 4.1 | % | |||||||||||||||||
Austin |
1,249 | 1,162 | 1,193 | 7.5 | % | 4.7 | % | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Total |
29,982 | 29,059 | 28,927 | 3.2 | % | 3.6 | % | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
Net operating income |
||||||||||||||||||||||||
Atlanta |
12,413 | 11,692 | 12,233 | 6.2 | % | 1.5 | % | 26.4 | % | |||||||||||||||
Washington, D.C. |
9,126 | 8,453 | 9,162 | 8.0 | % | (0.4 | )% | 19.3 | % | |||||||||||||||
Dallas |
9,265 | 8,410 | 9,065 | 10.2 | % | 2.2 | % | 19.6 | % | |||||||||||||||
Tampa |
5,576 | 5,073 | 5,371 | 9.9 | % | 3.8 | % | 11.8 | % | |||||||||||||||
Charlotte |
3,338 | 2,865 | 3,103 | 16.5 | % | 7.6 | % | 7.1 | % | |||||||||||||||
New York |
2,097 | 2,019 | 2,061 | 3.9 | % | 1.7 | % | 4.4 | % | |||||||||||||||
Houston |
2,039 | 1,747 | 1,920 | 16.7 | % | 6.2 | % | 4.3 | % | |||||||||||||||
Orlando |
1,735 | 1,555 | 1,710 | 11.6 | % | 1.5 | % | 3.7 | % | |||||||||||||||
Austin |
1,596 | 1,457 | 1,577 | 9.5 | % | 1.2 | % | 3.4 | % | |||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Total same store NOI |
$ | 47,185 | $ | 43,271 | $ | 46,202 | 9.0 | % | 2.1 | % | 100.0 | % | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
Average rental rate per unit |
||||||||||||||||||||||||
Atlanta |
$ | 1,214 | $ | 1,139 | $ | 1,187 | 6.6 | % | 2.3 | % | ||||||||||||||
Washington, D.C. |
1,883 | 1,826 | 1,859 | 3.1 | % | 1.3 | % | |||||||||||||||||
Dallas |
1,160 | 1,080 | 1,137 | 7.4 | % | 2.1 | % | |||||||||||||||||
Tampa |
1,348 | 1,260 | 1,321 | 7.0 | % | 2.0 | % | |||||||||||||||||
Charlotte |
1,167 | 1,071 | 1,129 | 9.0 | % | 3.4 | % | |||||||||||||||||
New York |
3,824 | 3,715 | 3,777 | 2.9 | % | 1.2 | % | |||||||||||||||||
Houston |
1,338 | 1,218 | 1,292 | 9.9 | % | 3.6 | % | |||||||||||||||||
Orlando |
1,487 | 1,383 | 1,447 | 7.5 | % | 2.7 | % | |||||||||||||||||
Austin |
1,466 | 1,350 | 1,421 | 8.6 | % | 3.2 | % | |||||||||||||||||
Total average rental rate per unit |
1,370 | 1,288 | 1,341 | 6.4 | % | 2.2 | % |
-11-
Table 3 (cont)
Same Store Net Operating Income (NOI) and Average Rental Rate per Unit by Market
(In thousands)
Nine months ended | % Change | |||||||||||
September 30, 2012 |
September 30, 2011 |
|||||||||||
Rental and other revenues |
||||||||||||
Atlanta |
$ | 61,273 | $ | 57,095 | 7.3 | % | ||||||
Washington, D.C. |
39,245 | 37,263 | 5.3 | % | ||||||||
Dallas |
47,103 | 43,569 | 8.1 | % | ||||||||
Tampa |
25,988 | 24,199 | 7.4 | % | ||||||||
Charlotte |
14,521 | 13,301 | 9.2 | % | ||||||||
New York |
10,979 | 10,513 | 4.4 | % | ||||||||
Houston |
10,050 | 9,116 | 10.2 | % | ||||||||
Orlando |
8,150 | 7,575 | 7.6 | % | ||||||||
Austin |
8,307 | 7,421 | 11.9 | % | ||||||||
|
|
|
|
|||||||||
Total rental and other revenues |
225,616 | 210,052 | 7.4 | % | ||||||||
|
|
|
|
|||||||||
Property operating and maintenance expenses (exclusive of depreciation and amortization) |
||||||||||||
Atlanta |
24,472 | 23,681 | 3.3 | % | ||||||||
Washington, D.C. |
12,126 | 12,080 | 0.4 | % | ||||||||
Dallas |
20,178 | 19,384 | 4.1 | % | ||||||||
Tampa |
9,703 | 9,203 | 5.4 | % | ||||||||
Charlotte |
5,037 | 5,068 | (0.6 | )% | ||||||||
New York |
4,905 | 4,632 | 5.9 | % | ||||||||
Houston |
4,052 | 3,976 | 1.9 | % | ||||||||
Orlando |
3,046 | 3,012 | 1.1 | % | ||||||||
Austin |
3,644 | 3,268 | 11.5 | % | ||||||||
|
|
|
|
|||||||||
Total |
87,163 | 84,304 | 3.4 | % | ||||||||
|
|
|
|
|||||||||
Net operating income |
||||||||||||
Atlanta |
36,801 | 33,414 | 10.1 | % | ||||||||
Washington, D.C. |
27,119 | 25,183 | 7.7 | % | ||||||||
Dallas |
26,925 | 24,185 | 11.3 | % | ||||||||
Tampa |
16,285 | 14,996 | 8.6 | % | ||||||||
Charlotte |
9,484 | 8,233 | 15.2 | % | ||||||||
New York |
6,074 | 5,881 | 3.3 | % | ||||||||
Houston |
5,998 | 5,140 | 16.7 | % | ||||||||
Orlando |
5,104 | 4,563 | 11.9 | % | ||||||||
Austin |
4,663 | 4,153 | 12.3 | % | ||||||||
|
|
|
|
|||||||||
Total same store NOI |
$ | 138,453 | $ | 125,748 | 10.1 | % | ||||||
|
|
|
|
|||||||||
Average rental rate per unit |
||||||||||||
Atlanta |
$ | 1,190 | $ | 1,113 | 6.9 | % | ||||||
Washington, D.C. |
1,861 | 1,806 | 3.0 | % | ||||||||
Dallas |
1,138 | 1,061 | 7.3 | % | ||||||||
Tampa |
1,322 | 1,231 | 7.4 | % | ||||||||
Charlotte |
1,134 | 1,043 | 8.7 | % | ||||||||
New York |
3,782 | 3,691 | 2.5 | % | ||||||||
Houston |
1,298 | 1,194 | 8.7 | % | ||||||||
Orlando |
1,453 | 1,358 | 7.0 | % | ||||||||
Austin |
1,429 | 1,316 | 8.6 | % | ||||||||
Total average rental rate per unit |
1,344 | 1,263 | 6.4 | % |
-12-
Table 4
Computation of Debt Ratios
(In thousands)
As of September 30, | ||||||||
2012 | 2011 | |||||||
Total real estate assets per balance sheet |
$ | 2,177,745 | $ | 2,025,333 | ||||
Plus: |
||||||||
Company share of real estate assets held in unconsolidated entities |
59,177 | 70,419 | ||||||
Company share of accumulated depreciation - assets held in unconsolidated entities |
10,658 | 12,091 | ||||||
Accumulated depreciation per balance sheet |
825,015 | 748,306 | ||||||
|
|
|
|
|||||
Total undepreciated real estate assets (A) |
$ | 3,072,595 | $ | 2,856,149 | ||||
|
|
|
|
|||||
Total debt per balance sheet |
$ | 1,036,492 | $ | 1,030,852 | ||||
Plus: |
||||||||
Company share of third party debt held in unconsolidated entities |
49,531 | 59,601 | ||||||
|
|
|
|
|||||
Total debt (adjusted for joint venture partners share of debt) (B) |
$ | 1,086,023 | $ | 1,090,453 | ||||
|
|
|
|
|||||
Total debt as a % of undepreciated real estate assets (adjusted for joint venture partners share of debt) (B÷A) |
35.3 | % | 38.2 | % | ||||
|
|
|
|
|||||
Total debt per balance sheet |
$ | 1,036,492 | $ | 1,030,852 | ||||
Plus: |
||||||||
Company share of third party debt held in unconsolidated entities |
49,531 | 59,601 | ||||||
Preferred shares at liquidation value |
43,392 | 43,392 | ||||||
|
|
|
|
|||||
Total debt and preferred equity (adjusted for joint venture partners share of debt) (C) |
$ | 1,129,415 | $ | 1,133,845 | ||||
|
|
|
|
|||||
Total debt and preferred equity as a % of undepreciated real estate assets (adjusted for joint venture partners share of debt) (C÷A) |
36.8 | % | 39.7 | % | ||||
|
|
|
|
-13-
Exhibit 99.2
Third Quarter 2012
Supplemental Financial Data
Table of Contents
Page | ||||
Consolidated Statements of Operations |
3 | |||
Funds from Operations and Adjusted Funds From Operations |
4 | |||
Consolidated Balance Sheets |
5 | |||
Same Store Results |
7 | |||
Debt Summary |
10 | |||
Summary of Apartment Communities Under Development, |
13 | |||
Summary of Condominium Projects |
14 | |||
Capitalized Costs Summary |
15 | |||
Investments in Unconsolidated Real Estate Entities |
16 | |||
Net Asset Value Supplemental Information |
17 | |||
Non-GAAP Financial Measures and Other Defined Terms and Property Tables |
19 |
The projections and estimates given in this document and other written or oral statements made by or on behalf of the Company may constitute forward-looking statements within the meaning of the federal securities laws. All forward-looking statements are subject to certain risks and uncertainties that could cause actual events to differ materially from those projected. Management believes that these forward-looking statements are reasonable; however, you should not place undue reliance on such statements. These statements are based on current expectations and speak only as of the date of such statements. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information or otherwise. The following are some of the factors that could cause the Companys actual results and its expectations to differ materially from those described in the Companys forward-looking statements: the success of the Companys business strategies discussed in its Annual Report on Form 10-K for the year ended December 31, 2011 and in subsequent filings with the SEC; conditions affecting ownership of residential real estate and general conditions in the multi-family residential real estate market; uncertainties associated with the Companys real estate development and construction; uncertainties associated with the timing and amount of apartment community sales; exposure to economic and other competitive factors due to market concentration; future local and national economic conditions, including changes in job growth, interest rates, the availability of mortgage and other financing and related factors; the Companys ability to generate sufficient cash flows to make required payments associated with its debt financing; the effects of the Companys leverage on its risk of default and debt service requirements; the impact of a downgrade in the credit rating of the Companys securities; the effects of a default by the Company or its subsidiaries on an obligation to repay outstanding indebtedness, including cross-defaults and cross-acceleration under other indebtedness; the effects of covenants of the Companys or its subsidiaries mortgage indebtedness on operational flexibility and default risks; the effects of any decision by the government to eliminate Fannie Mae or Freddie Mac or reduce government support for apartment mortgage loans; the Companys ability to maintain its current dividend level; uncertainties associated with the Companys condominium for-sale housing business, including the timing and volume of condominium sales; the impact of any additional charges the Company may be required to record in the future related to any impairment in the carrying value of its assets; the impact of competition on the Companys business, including competition for residents in the Companys apartment communities and buyers of the Companys for-sale condominium homes and development locations; the Companys ability to compete for limited investment opportunities; the effects of changing interest rates and effectiveness of interest rate hedging contracts; the success of the Companys acquired apartment communities; the Companys ability to succeed in new markets; the costs associated with compliance with laws requiring access to the Companys properties by persons with disabilities; the impact of the Companys ongoing litigation with the U.S. Department of Justice regarding the Americans with Disabilities Act and the Fair Housing Act as well as the impact of other litigation; the effects of losses from natural catastrophes in excess of insurance coverage; uncertainties associated with environmental and other regulatory matters; the costs associated with moisture infiltration and resulting mold remediation; the Companys ability to control joint ventures, properties in which it has joint ownership and corporations and limited partnership in which it has partial interests; the Companys ability to renew leases or relet units as leases expire; the Companys ability to continue to qualify as a REIT under the Internal Revenue Code; and the effects of changes in accounting policies and other regulatory matters detailed in the Companys filings with the Securities and Exchange Commission; increased costs arising from health care reform; any breach of the Companys privacy or information security systems. Other important risk factors regarding the Company are included under the caption Risk Factors in the Companys Annual Report on Form 10-K for the year ended December 31, 2011 and may be discussed in subsequent filings with the SEC. The risk factors discussed in Form 10-K under the caption Risk Factors are specifically incorporated by reference into this document.
Supplemental Financial Data | 2 | Page |
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data) - (Unaudited)
Three months ended September 30, |
Nine months ended September 30, |
|||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Revenues |
||||||||||||||||
Rental |
$ | 81,069 | $ | 73,607 | $ | 233,805 | $ | 213,199 | ||||||||
Other property revenues |
5,096 | 4,762 | 14,368 | 13,682 | ||||||||||||
Other |
209 | 243 | 637 | 686 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenues |
86,374 | 78,612 | 248,810 | 227,567 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Expenses |
||||||||||||||||
Property operating and maintenance (exclusive of items shown separately below) |
37,341 | 34,618 | 107,209 | 100,441 | ||||||||||||
Depreciation |
20,334 | 18,823 | 59,172 | 56,383 | ||||||||||||
General and administrative |
3,763 | 3,970 | 11,931 | 12,332 | ||||||||||||
Investment and development (1) |
203 | 239 | 1,005 | 1,013 | ||||||||||||
Other investment costs (1) |
547 | 329 | 1,159 | 1,278 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total expenses |
62,188 | 57,979 | 180,476 | 171,447 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Operating income |
24,186 | 20,633 | 68,334 | 56,120 | ||||||||||||
Interest income |
20 | 374 | 359 | 982 | ||||||||||||
Interest expense |
(11,816 | ) | (14,207 | ) | (34,564 | ) | (43,119 | ) | ||||||||
Amortization of deferred financing costs |
(667 | ) | (717 | ) | (2,026 | ) | (2,085 | ) | ||||||||
Net gains on condominium sales activities (2) |
10,261 | 2,581 | 25,695 | 8,757 | ||||||||||||
Equity in income of unconsolidated real estate entities, net (3) |
475 | 235 | 7,416 | 790 | ||||||||||||
Other income (expense), net |
(137 | ) | (71 | ) | 444 | 230 | ||||||||||
Net loss on extinguishment of indebtedness (4) |
| | (301 | ) | | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income |
22,322 | 8,828 | 65,357 | 21,675 | ||||||||||||
Noncontrolling interests - consolidated real estate entities |
(55 | ) | (9 | ) | (96 | ) | (56 | ) | ||||||||
Noncontrolling interests - Operating Partnership |
(60 | ) | (25 | ) | (175 | ) | (54 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income available to the Company |
22,207 | 8,794 | 65,086 | 21,565 | ||||||||||||
Dividends to preferred shareholders |
(922 | ) | (922 | ) | (2,766 | ) | (3,533 | ) | ||||||||
Preferred stock redemption costs |
| | | (1,757 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income available to common shareholders |
$ | 21,285 | $ | 7,872 | $ | 62,320 | $ | 16,275 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Per common share data - Basic (5) |
||||||||||||||||
Net income available to common shareholders |
$ | 0.39 | $ | 0.15 | $ | 1.16 | $ | 0.33 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Weighted average common shares outstanding - basic |
54,115 | 50,651 | 53,661 | 49,862 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Per common share data - Diluted (5) |
||||||||||||||||
Net income available to common shareholders |
$ | 0.39 | $ | 0.15 | $ | 1.15 | $ | 0.32 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Weighted average common shares outstanding - diluted |
54,392 | 51,053 | 54,001 | 50,259 | ||||||||||||
|
|
|
|
|
|
|
|
See Notes to Consolidated Financial Statements on page 6
Supplemental Financial Data | 3 | Page |
FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS
(In thousands, except per share data) - (Unaudited)
A reconciliation of net income available to common shareholders to funds from operations available to common shareholders and unitholders, and adjusted funds from operations available to common shareholders and unitholders is provided below.
Three months ended September 30, |
Nine months ended September 30, |
|||||||||||||||
Funds From Operations |
2012 | 2011 | 2012 | 2011 | ||||||||||||
Net income available to common shareholders |
$ | 21,285 | $ | 7,872 | $ | 62,320 | $ | 16,275 | ||||||||
Noncontrolling interests - Operating Partnership |
60 | 25 | 175 | 54 | ||||||||||||
Depreciation on consolidated real estate assets, net (6) |
20,012 | 18,475 | 58,171 | 55,340 | ||||||||||||
Depreciation on real estate assets held in unconsolidated entities |
287 | 363 | 910 | 1,084 | ||||||||||||
Gains on sales of depreciable real estate assets - unconsolidated entities |
| | (6,055 | ) | | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Funds from operations available to common shareholders and unitholders (A) |
$ | 41,644 | $ | 26,735 | $ | 115,521 | $ | 72,753 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Funds from operations available to common shareholders and unitholders - core operations (B) |
$ | 31,383 | $ | 24,154 | $ | 89,826 | $ | 63,996 | ||||||||
Funds from operations available to common shareholders and unitholders - condominiums |
10,261 | 2,581 | 25,695 | 8,757 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Funds from operations available to common shareholders and unitholders (A) |
$ | 41,644 | $ | 26,735 | $ | 115,521 | $ | 72,753 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted Funds From Operations |
||||||||||||||||
Funds from operations available to common shareholders and unitholders (A) |
$ | 41,644 | $ | 26,735 | $ | 115,521 | $ | 72,753 | ||||||||
Annually recurring capital expenditures |
(4,672 | ) | (5,458 | ) | (12,152 | ) | (11,978 | ) | ||||||||
Periodically recurring capital expenditures |
(2,214 | ) | (1,875 | ) | (5,736 | ) | (5,443 | ) | ||||||||
Non-cash straight-line adjustment for ground lease expenses |
121 | 128 | 367 | 384 | ||||||||||||
Net loss on early extinguishment of indebtedness |
| | 301 | | ||||||||||||
Preferred stock redemption costs |
| | | 1,757 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted funds from operations available to common shareholders and unitholders (7) (C) |
$ | 34,879 | $ | 19,530 | $ | 98,301 | $ | 57,473 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted funds from operations available to common shareholders and unitholders - core operations (7) (D) |
$ | 24,618 | $ | 16,949 | $ | 72,606 | $ | 48,716 | ||||||||
Adjusted funds from operations available to common shareholders and unitholders - condominiums (7) |
10,261 | 2,581 | 25,695 | 8,757 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted funds from operations available to common shareholders and unitholders (7) (C) |
$ | 34,879 | $ | 19,530 | $ | 98,301 | $ | 57,473 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Per Common Share Data - Diluted |
||||||||||||||||
Funds from operations per share or unit, as defined (A÷E) |
$ | 0.76 | $ | 0.52 | $ | 2.13 | $ | 1.44 | ||||||||
Funds from operations per share or unit - core operations (B÷E) |
$ | 0.57 | $ | 0.47 | $ | 1.66 | $ | 1.27 | ||||||||
Adjusted funds from operations per share or unit, as defined (7) (C÷E) |
$ | 0.64 | $ | 0.38 | $ | 1.81 | $ | 1.14 | ||||||||
Adjusted funds from operations per share or unit - core operations (7) (D÷E) |
$ | 0.45 | $ | 0.33 | $ | 1.34 | $ | 0.96 | ||||||||
Dividends declared |
$ | 0.25 | $ | 0.22 | $ | 0.72 | $ | 0.62 | ||||||||
Weighted average shares outstanding (8) |
54,522 | 51,217 | 54,126 | 50,421 | ||||||||||||
Weighted average shares and units outstanding (8) (E) |
54,665 | 51,379 | 54,275 | 50,588 |
See Notes to Funds from Operations and Adjusted Funds from Operations on page 6
Supplemental Financial Data | 4 | Page |
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
September 30, 2012 |
December 31, 2011 |
|||||||
(Unaudited) | ||||||||
Assets |
||||||||
Real estate assets |
||||||||
Land |
$ | 312,774 | $ | 299,720 | ||||
Building and improvements |
2,230,285 | 2,085,929 | ||||||
Furniture, fixtures and equipment |
266,084 | 251,663 | ||||||
Construction in progress |
115,594 | 94,981 | ||||||
Land held for future development |
45,957 | 55,396 | ||||||
|
|
|
|
|||||
2,970,694 | 2,787,689 | |||||||
Less: accumulated depreciation |
(825,015 | ) | (767,017 | ) | ||||
For-sale condominiums |
32,066 | 54,845 | ||||||
|
|
|
|
|||||
Total real estate assets |
2,177,745 | 2,075,517 | ||||||
Investments in and advances to unconsolidated real estate entities |
5,040 | 7,344 | ||||||
Cash and cash equivalents |
64,222 | 13,084 | ||||||
Restricted cash |
5,817 | 5,126 | ||||||
Deferred financing costs, net |
9,376 | 6,381 | ||||||
Other assets |
31,463 | 31,612 | ||||||
|
|
|
|
|||||
Total assets |
$ | 2,293,663 | $ | 2,139,064 | ||||
|
|
|
|
|||||
Liabilities and equity |
||||||||
Indebtedness |
$ | 1,036,492 | $ | 970,443 | ||||
Accounts payable, accrued expenses and other |
89,121 | 72,102 | ||||||
Investments in unconsolidated real estate entities |
16,192 | 15,945 | ||||||
Dividends and distributions payable |
13,639 | 11,692 | ||||||
Accrued interest payable |
9,186 | 5,185 | ||||||
Security deposits and prepaid rents |
9,400 | 9,334 | ||||||
|
|
|
|
|||||
Total liabilities |
1,174,030 | 1,084,701 | ||||||
|
|
|
|
|||||
Redeemable common units |
6,874 | 6,840 | ||||||
|
|
|
|
|||||
Commitments and contingencies |
||||||||
Equity |
||||||||
Company shareholders equity |
||||||||
Preferred stock, $.01 par value, 20,000 authorized: |
||||||||
8 1/2% Series A Cumulative Redeemable Shares, liquidation preference $50 per share, 868 shares issued and outstanding |
9 | 9 | ||||||
Common stock, $.01 par value, 100,000 authorized: |
||||||||
54,413 and 53,002 shares issued and 54,413 and 52,988 shares outstanding at September 30, 2012 and December 31, 2011, respectively |
545 | 530 | ||||||
Additional paid-in-capital |
1,104,781 | 1,053,612 | ||||||
Accumulated earnings |
23,219 | | ||||||
Accumulated other comprehensive income (loss) |
(12,614 | ) | (2,633 | ) | ||||
|
|
|
|
|||||
1,115,940 | 1,051,518 | |||||||
Less common stock in treasury, at cost, 93 and 113 shares at September 30, 2012 and December 31, 2011, respectively |
(3,106 | ) | (4,000 | ) | ||||
|
|
|
|
|||||
Total Company shareholders equity |
1,112,834 | 1,047,518 | ||||||
Noncontrolling interests - consolidated property partnerships |
(75 | ) | 5 | |||||
|
|
|
|
|||||
Total equity |
1,112,759 | 1,047,523 | ||||||
|
|
|
|
|||||
Total liabilities and equity |
$ | 2,293,663 | $ | 2,139,064 | ||||
|
|
|
|
See Notes to Consolidated Financial Statements on page 6
Supplemental Financial Data | 5 | Page |
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AND RECONCILIATION OF FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS
(In thousands)
1) | Investment and development expenses include investment group expenses, development personnel and associated costs not allocable to development projects. Other investment costs primarily include land carry costs, principally property taxes and assessments, as well as acquisition expenses of $139 and the write-off of development pursuit costs of $135 for the three and nine months ended September 30, 2012. |
2) | A summary of revenues and costs and expenses of condominium activities for the three and nine months ended September 30, 2012 and 2011 is as follows: |
Three months ended September 30, |
Nine months ended September 30, | |||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||
Condominium revenues |
$ | 23,517 | $ | 13,678 | $ | 64,043 | $ | 46,443 | ||||||||||||
Condominium costs and expenses |
(13,256 | ) | (11,097 | ) | (38,960 | ) | (37,686 | ) | ||||||||||||
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|
|
|
|
|
|
|
|||||||||||||
Gains on sales of condominiums, before income taxes |
10,261 | 2,581 | 25,083 | 8,757 | ||||||||||||||||
Income tax benefit |
| | 612 | | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Net gains on sales of condominiums |
$ | 10,261 | $ | 2,581 | $ | 25,695 | $ | 8,757 | ||||||||||||
|
|
|
|
|
|
|
|
3) | Equity in earnings of unconsolidated entities for the nine months ended September 30, 2012 includes the Companys $6,055 share of the gain on the sale of Post Biltmore, previously owned by a 35% owned unconsolidated entity. |
4) | The net loss on early extinguishment of indebtedness of $301 for the nine months ended September 30, 2012 represents the write-off of a portion of the Companys unamortized deferred loan costs associated with the refinancing of the Companys lines of credit. |
5) | Post Properties, Inc., through its wholly-owned subsidiaries, is the sole general partner, a limited partner and owns a majority interest in Post Apartment Homes, L.P., the Operating Partnership, through which the Company conducts its operations. As of September 30, 2012, there were 54,556 Operating Partnership units outstanding, of which 54,413, or 99.7%, were owned by the Company. |
6) | Depreciation on consolidated real estate assets is net of the minority interest portion of depreciation on consolidated entities. |
7) | Since the Company does not add back the depreciation of non-real estate assets in its calculation of FFO, non-real estate related capital expenditures of $76 and $440 for the three months and $521 and $926 for the nine months ended September 30, 2012 and 2011, respectively, are excluded from the calculation of adjusted funds from operations available to common shareholders and unitholders. |
8) | Diluted weighted average shares and units include the impact of dilutive securities totaling 277 and 402 for the three months and 340 and 397 for the nine months ended September 30, 2012 and 2011, respectively. Additionally, diluted weighted average shares and units included the impact of non-vested shares and units totaling 129 and 164 for the three months and 126 and 162 for the nine months ended September 30, 2012 and 2011, respectively, for the computation of FFO per share. Such non-vested shares and units are considered in the income per share computations under GAAP using the two-class method. |
Supplemental Financial Data | 6 | Page |
SAME STORE RESULTS
(In thousands, except per unit data) - (Unaudited)
Same Store Operating Results
The Company defines same store communities as those which have reached stabilization prior to the beginning of the previous calendar year. Same store net operating income is a supplemental non-GAAP financial measure. See Table 1 on page 21 for a reconciliation of same store net operating income to GAAP net income and Table 4 on page 26 for a year-to-date margin analysis. The operating performance and capital expenditures of the 50 communities containing 18,114 apartment units which were fully stabilized as of January 1, 2011, are summarized in the table below.
Three months ended | Nine months ended | |||||||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||||||
2012 | 2011 | % Change | 2012 | 2011 | % Change | |||||||||||||||||||||||||
Revenues: |
||||||||||||||||||||||||||||||
Rental and other revenue |
$ | 74,747 | $ | 69,919 | 6.9% | $ | 218,719 | $ | 203,288 | 7.6% | ||||||||||||||||||||
Utility reimbursements |
2,420 | 2,411 | 0.4% | 6,897 | 6,764 | 2.0% | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total rental and other revenues |
$ | 77,167 | $ | 72,330 | 6.7% | $ | 225,616 | $ | 210,052 | 7.4% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Property operating and maintenance expenses: |
||||||||||||||||||||||||||||||
Personnel expenses |
6,869 | 6,724 | 2.2% | 20,298 | 19,990 | 1.5% | ||||||||||||||||||||||||
Utility expense |
4,610 | 4,821 | (4.4)% | 12,517 | 13,073 | (4.3)% | ||||||||||||||||||||||||
Real estate taxes and fees |
10,964 | 9,531 | 15.0% | 31,955 | 28,037 | 14.0% | ||||||||||||||||||||||||
Insurance expenses |
1,044 | 929 | 12.4% | 3,189 | 2,910 | 9.6% | ||||||||||||||||||||||||
Building and grounds repairs and maintenance (1) |
4,336 | 4,685 | (7.4)% | 12,809 | 13,237 | (3.2)% | ||||||||||||||||||||||||
Ground lease expense (2) |
230 | 234 | (1.7)% | 690 | 834 | (17.3)% | ||||||||||||||||||||||||
Other expenses |
1,929 | 2,135 | (9.6)% | 5,705 | 6,223 | (8.3)% | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total property operating and maintenance expenses (excluding depreciation and amortization) |
29,982 | 29,059 | 3.2% | 87,163 | 84,304 | 3.4% | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Same store net operating income |
$ | 47,185 | $ | 43,271 | 9.0% | $ | 138,453 | $ | 125,748 | 10.1% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Same store net operating income margin |
61.1 | % | 59.8 | % | 1.3% | 61.4 | % | 59.9 | % | 1.5% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Capital expenditures (3) |
||||||||||||||||||||||||||||||
Annually recurring: |
||||||||||||||||||||||||||||||
Carpet |
$ | 1,005 | $ | 925 | 8.6% | $ | 2,587 | $ | 2,349 | 10.1% | ||||||||||||||||||||
Other |
3,202 | 4,383 | (26.9)% | 8,597 | 9,289 | (7.4)% | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total annually recurring |
4,207 | 5,308 | (20.7)% | 11,184 | 11,638 | (3.9)% | ||||||||||||||||||||||||
Periodically recurring (3) |
1,840 | 1,350 | 36.3% | 4,267 | 4,259 | 0.2% | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total capital expenditures (A) |
$ | 6,047 | $ | 6,658 | (9.2)% | $ | 15,451 | $ | 15,897 | (2.8)% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total capital expenditures per unit |
||||||||||||||||||||||||||||||
(A ÷ 18,114 units) |
$ | 334 | $ | 368 | (9.2)% | $ | 853 | $ | 878 | (2.8)% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Average monthly rental rate per unit (4) |
$ | 1,370 | $ | 1,288 | 6.4% | $ | 1,344 | $ | 1,263 | 6.4% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Gross turnover (5) |
70.3 | % | 67.6 | % | 2.7% | 60.4 | % | 59.3 | % | 1.1% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Net turnover (6) |
63.8 | % | 62.0 | % | 1.8% | 54.2 | % | 53.5 | % | 0.7% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Percentage rent increase - new leases (7) |
5.2 | % | 6.6 | % | (1.4)% | 6.0 | % | 6.4 | % | (0.4)% | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Percentage rent increase - renewed leases (7) |
6.4 | % | 6.3 | % | 0.1% | 6.6 | % | 5.6 | % | 1.0% | ||||||||||||||||||||
|
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|
|
1) | Building and grounds repairs and maintenance includes $53 and $188 for the three months and $490 and $516 for the nine months ended September 30, 2012 and 2011, respectively, related to exterior painting of communities. |
2) | Ground lease expense reflects the cessation of ground lease expenses at the Companys Post Renaissance® community, effective July 1, 2011. |
3) | See Table 5 on page 27 for a reconciliation of these segment components of property capital expenditures to total annually recurring capital expenditures and total periodically recurring capital expenditures as presented in the consolidated cash flow statements prepared under GAAP. Periodically recurring capital expenditures includes $159 and $184 for the three months and $426 and $457 for the nine months ended September 30, 2012 and 2011, respectively, related to the Companys resident design center program. |
4) | Average monthly rental rate is defined as the average of the gross actual rates for occupied units and the anticipated rental rates for unoccupied units divided by total units. See Table 2 on page 22 and Table 3 on page 24 for further information. |
5) | Gross turnover represents the percentage of leases expiring during the period that are not renewed by the existing resident(s). |
6) | Net turnover is gross turnover decreased by the percentage of expiring leases where the resident(s) transfer to a new apartment unit in the same community or in another Post® community. |
7) | Percentage change is calculated using the respective new or renewed rental rate as of the date of a new lease, as compared with the previous rental rate on that same unit. Accordingly, these percentage changes may differ from the change in the average monthly rental rate per unit due to the timing of move-ins and/or the term of the respective leases. |
Supplemental Financial Data | 7 | Page |
SAME STORE RESULTS (CONT)
(In thousands, except per unit data) - (Unaudited)
Same Store Operating Results by Market - Comparison of Third Quarter and Year to Date 2012 to Third Quarter and Year to Date 2011
(Increase (decrease) between periods)
Three months ended | Nine months ended | |||||||||||||||||||||||||||||||||||||||
September 30, 2012 | September 30, 2012 | |||||||||||||||||||||||||||||||||||||||
Average | Average | |||||||||||||||||||||||||||||||||||||||
Economic | Economic | |||||||||||||||||||||||||||||||||||||||
Market |
Revenues (1) | Expenses (1) | NOI (1) | Occupancy | Revenues (1) | Expenses (1) | NOI (1) | Occupancy | ||||||||||||||||||||||||||||||||
Atlanta |
6.8% | 7.6% | 6.2% | (0.1)% | 7.3% | 3.3% | 10.1% | 0.1% | ||||||||||||||||||||||||||||||||
Washington, D.C. |
3.5% | (5.2)% | 8.0% | 0.0% | 5.3% | 0.4% | 7.7% | 1.2% | ||||||||||||||||||||||||||||||||
Dallas |
7.7% | 4.6% | 10.2% | 0.4% | 8.1% | 4.1% | 11.3% | 0.9% | ||||||||||||||||||||||||||||||||
Tampa |
7.6% | 3.9% | 9.9% | 0.2% | 7.4% | 5.4% | 8.6% | (0.2)% | ||||||||||||||||||||||||||||||||
Charlotte |
9.1% | (3.1)% | 16.5% | 0.6% | 9.2% | (0.6)% | 15.2% | 0.7% | ||||||||||||||||||||||||||||||||
New York |
3.6% | 3.3% | 3.9% | 0.2% | 4.4% | 5.9% | 3.3% | 1.6% | ||||||||||||||||||||||||||||||||
Houston |
9.9% | 1.4% | 16.7% | 0.2% | 10.2% | 1.9% | 16.7% | 1.0% | ||||||||||||||||||||||||||||||||
Orlando |
7.5% | 1.4% | 11.6% | 0.1% | 7.6% | 1.1% | 11.9% | 0.6% | ||||||||||||||||||||||||||||||||
Austin |
8.6% | 7.5% | 9.5% | (0.2)% | 11.9% | 11.5% | 12.3% | 0.8% | ||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Total |
6.7% | 3.2% | 9.0% | 0.2% | 7.4% | 3.4% | 10.1% | 0.7% | ||||||||||||||||||||||||||||||||
|
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|
1) | See Table 2 on page 22 for a reconciliation of these components of same store net operating income and Table 1 on page 21 for a reconciliation of same store net operating income to GAAP net income. |
Same Store Occupancy by Market
Apartment Units |
% of
NOI Three months ended September 30, 2012 |
Physical Occupancy at September 30, 2012 (2) |
Average Rental Rate Per Unit Three Months Ended September 30, 2012 (3) | |||||||||||||||||||||||||||||||||||||
Average Economic | Average Economic | |||||||||||||||||||||||||||||||||||||||
Occupancy (1) | Occupancy (1) | |||||||||||||||||||||||||||||||||||||||
Three months ended | Nine months ended | |||||||||||||||||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||||||||||||||||
Market |
2012 | 2011 | 2012 | 2011 | ||||||||||||||||||||||||||||||||||||
Atlanta |
5,407 | 26.4% | 97.2% | 97.3% | 96.6% | 96.5% | 96.3% | $ | 1,214 | |||||||||||||||||||||||||||||||
Washington, D.C. |
2,301 | 19.3% | 95.5% | 95.5% | 95.3% | 94.1% | 95.0% | 1,883 | ||||||||||||||||||||||||||||||||
Dallas |
4,498 | 19.6% | 96.4% | 96.0% | 95.5% | 94.6% | 96.0% | 1,160 | ||||||||||||||||||||||||||||||||
Tampa |
2,111 | 11.8% | 96.9% | 96.7% | 96.7% | 96.9% | 95.7% | 1,348 | ||||||||||||||||||||||||||||||||
Charlotte |
1,388 | 7.1% | 97.4% | 96.8% | 96.5% | 95.8% | 95.5% | 1,167 | ||||||||||||||||||||||||||||||||
New York |
337 | 4.4% | 95.8% | 95.6% | 95.9% | 94.3% | 97.3% | 3,824 | ||||||||||||||||||||||||||||||||
Houston |
837 | 4.3% | 96.5% | 96.3% | 96.7% | 95.7% | 96.7% | 1,338 | ||||||||||||||||||||||||||||||||
Orlando |
598 | 3.7% | 97.5% | 97.4% | 97.5% | 96.9% | 97.2% | 1,487 | ||||||||||||||||||||||||||||||||
Austin |
637 | 3.4% | 96.1% | 96.3% | 96.3% | 95.5% | 95.6% | 1,466 | ||||||||||||||||||||||||||||||||
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|
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|
|
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|
|
|
|
|
|||||||||||||||||||||||||
Total |
18,114 | 100.0% | 96.6% | 96.4% | 96.2% | 95.5% | 96.0% | $ | 1,370 | |||||||||||||||||||||||||||||||
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1) | Average economic occupancy is defined as gross potential rent less vacancy losses, model expenses and bad debt expenses divided by gross potential rent for the period, expressed as a percentage. Gross potential rent is defined as the sum of the gross actual rates for leased units and the anticipated rental rates for unoccupied units. The calculation of average economic occupancy does not include a deduction for net concessions and employee discounts. Average economic occupancy, including these amounts, would have been 95.9% and 95.5% for the three months and 95.5% and 94.3% for the nine months ended September 30, 2012 and 2011, respectively. For the three months ended September 30, 2012 and 2011, net concessions were $274 and $456, respectively, and employee discounts were $218 and $205, respectively. For the nine months ended September 30, 2012 and 2011, net concessions were $908 and $1,886, respectively, and employee discounts were $642 and $604, respectively. |
2) | Physical occupancy is defined as the number of units occupied divided by total apartment units, expressed as a percentage. |
3) | Average monthly rental rate is defined as the average of the gross actual rates for occupied units and the anticipated rental rates for unoccupied units divided by total units. See Table 2 on page 22 and Table 3 on page 24 for further information. |
Supplemental Financial Data | 8 | Page |
SAME STORE RESULTS (CONT)
(In thousands, except per unit data) - (Unaudited)
Sequential Same Store Operating Results Comparison of Third Quarter of 2012 to Second Quarter of 2012
Three months ended | ||||||||||||
September 30, 2012 |
June 30, 2012 |
% Change | ||||||||||
Rental and other revenue |
$ | 74,747 | $ | 72,868 | 2.6% | |||||||
Utility reimbursements |
2,420 | 2,261 | 7.0% | |||||||||
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Total rental and other revenues |
$ | 77,167 | $ | 75,129 | 2.7% | |||||||
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Personnel expenses |
6,869 | 6,611 | 3.9% | |||||||||
Utility expense |
4,610 | 4,039 | 14.1% | |||||||||
Real estate taxes and fees |
10,964 | 10,603 | 3.4% | |||||||||
Insurance expenses |
1,044 | 1,026 | 1.8% | |||||||||
Building and grounds repairs and maintenance (1) |
4,336 | 4,473 | (3.1)% | |||||||||
Ground lease expense |
230 | 227 | 1.3% | |||||||||
Other expenses |
1,929 | 1,948 | (1.0)% | |||||||||
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Total property operating and maintenance expenses (excluding depreciation and amortization) |
29,982 | 28,927 | 3.6% | |||||||||
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Same store net operating income (2) |
$ | 47,185 | $ | 46,202 | 2.1% | |||||||
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Average economic occupancy |
96.6 | % | 96.1 | % | 0.5% | |||||||
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Average monthly rental rate per unit |
$ | 1,370 | $ | 1,341 | 2.2% | |||||||
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1) | Building and grounds repairs and maintenance includes $53 and $292 for the three months ended September 30, 2012 and June 30, 2012, respectively, related to exterior painting of communities. |
2) | See Table 2 on page 22 for a reconciliation of these components of same store net operating income and Table 1 on page 21 for a reconciliation of same store net operating income to GAAP net income. |
Sequential Same Store Operating Results by Market - Comparison of Third Quarter of 2012 to Second Quarter of 2012
(Increase (decrease) between periods)
Market |
Revenues (1) | Expenses (1) | NOI (1) | Average Economic Occupancy | ||||||||||||||||
Atlanta |
3.3% | 6.0% | 1.5% | 1.1% | ||||||||||||||||
Washington, D.C. |
1.3% | 5.3% | (0.4)% | (0.2)% | ||||||||||||||||
Dallas |
3.4% | 5.1% | 2.2% | 0.7% | ||||||||||||||||
Tampa |
2.6% | 0.6% | 3.8% | 0.6% | ||||||||||||||||
Charlotte |
3.5% | (3.8)% | 7.6% | 0.9% | ||||||||||||||||
New York |
1.1% | 0.3% | 1.7% | (0.3)% | ||||||||||||||||
Houston |
2.6% | (2.2)% | 6.2% | (0.9)% | ||||||||||||||||
Orlando |
2.4% | 4.1% | 1.5% | 0.2% | ||||||||||||||||
Austin |
2.7% | 4.7% | 1.2% | (0.6)% | ||||||||||||||||
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Total |
2.7% | 3.6% | 2.1% | 0.5% | ||||||||||||||||
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1) | See Table 2 on page 22 for a reconciliation of these components of same store net operating income and Table 1 on page 21 for a reconciliation of same store net operating income to GAAP net income. |
Supplemental Financial Data | 9 | Page |
DEBT SUMMARY
(In thousands) - (Unaudited)
Summary of Outstanding Debt at September 30, 2012 - Consolidated
Type of Indebtedness |
Balance | Percentage of Total Debt |
Weighted Average Rate (1) September 30, | |||||||||||||||||
2012 | 2011 | |||||||||||||||||||
Unsecured fixed rate senior notes |
$ | 280,091 | 27.0% | 5.5% | 5.5% | |||||||||||||||
Unsecured bank term loan |
300,000 | 29.0% | 3.4% | | ||||||||||||||||
Secured fixed rate notes |
456,401 | 44.0% | 5.6% | 5.7% | ||||||||||||||||
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$ | 1,036,492 | 100.0% | 4.9% | 5.6% | ||||||||||||||||
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Balance | Percentage of Total Debt |
Weighted Average Maturity of Total Debt (2) | ||||||||||||||||||
Total fixed rate debt |
$ | 1,036,492 | 100.0% | 4.5 | ||||||||||||||||
Total variable rate debt - unhedged |
| 0.0% | 0.0 | |||||||||||||||||
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Total debt |
$ | 1,036,492 | 100.0% | 4.5 | ||||||||||||||||
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Debt Maturities Consolidated and Unconsolidated
Consolidated | Unconsolidated Entities | ||||||||||||||||||||||||
Aggregate debt maturities by year |
Amount | Weighted Avg. Rate on Debt Maturities (1) |
Amount | Company Share |
Weighted Avg. Rate on Debt Maturities (1) | ||||||||||||||||||||
Remainder of 2012 |
$ | 1,153 | 5.8 | % | $ | | $ | | | ||||||||||||||||
2013 |
186,606 | 6.1 | % | | | | |||||||||||||||||||
2014 |
3,961 | 5.9 | % | | | | |||||||||||||||||||
2015 |
124,205 | (9) | 4.9 | % | | | | ||||||||||||||||||
2016 |
4,419 | (3) | 5.9 | % | | | | ||||||||||||||||||
Thereafter |
716,148 | 4.6 | % | 177,723 | 49,531 | 5.0 | % | ||||||||||||||||||
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$ | 1,036,492 | 4.9 | % | $ | 177,723 | $ | 49,531 | 5.0 | % | ||||||||||||||||
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Debt Statistics
Nine months
ended September 30, | ||||||||||
2012 | 2011 | |||||||||
Interest coverage ratio (4)(5) |
3.7x | 2.7x | ||||||||
Interest coverage ratio (including capitalized interest) (4)(5) |
3.3x | 2.6x | ||||||||
Fixed charge coverage ratio (4)(6) |
3.5x | 2.5x | ||||||||
Fixed charge coverage ratio (including capitalized interest) (4)(6) |
3.1x | 2.4x | ||||||||
Total debt to annualized income available for debt service ratio (7) |
6.0x | 6.7x | ||||||||
Total debt as a % of undepreciated real estate assets (adjusted for joint venture partners share of debt) (8) |
35.3 | % | 38.2 | % | ||||||
Total debt and preferred equity as a % of undepreciated real estate assets (adjusted for joint venture partners share of debt) (8) |
36.8 | % | 39.7 | % |
1) | Weighted average rate includes credit enhancements and other fees, where applicable. The weighted average rates at September 30, 2012 are based on the debt outstanding at that date. Weighted average interest rate of the unsecured bank term loan represents the effective fixed interest rate based on outstanding borrowings as of September 30, 2012, after considering the impact of interest rate swap arrangements that hedge this debt. Effective October 1, 2012, the effective fixed interest rate for the term loan was reduced to approximately 3.2% due to recent upgrades to the Companys credit ratings. |
2) | Weighted average maturity of total debt represents number of years to maturity based on the debt maturities schedule above. |
3) | Includes $0 outstanding on unsecured revolving lines of credit maturing in 2016. |
4) | Calculated for the nine months ended September 30, 2012 and 2011. |
5) | Interest coverage ratio is defined as net income available for debt service divided by interest expense. The calculation of the interest coverage ratio is a non-GAAP financial measure. A reconciliation of net income available for debt service to net income and interest expense to consolidated interest expense is included in Table 7 on page 28. |
6) | Fixed charge coverage ratio is defined as net income available for debt service divided by interest expense plus dividends to preferred shareholders. The calculation of the fixed charge coverage ratio is a non-GAAP financial measure. A reconciliation of net income available for debt service to net income and fixed charges to consolidated interest expense plus dividends to preferred shareholders is included in Table 7 on page 28. |
7) | A computation of this ratio is included in Table 7 on page 28. |
8) | A computation of this debt ratio is included in Table 6 on page 27. |
9) | Includes a mortgage note payable of $120,000 that matures in February 2015 at which time it will automatically be extended for a one-year term at a variable interest rate. |
Supplemental Financial Data | 10 | Page |
DEBT SUMMARY (CONT)
(In thousands) - (Unaudited)
Financial Debt Covenants - Senior Unsecured Public Notes
Covenant requirement (1) |
As
of September 30, 2012 | ||||
Consolidated Debt to Total Assets cannot exceed 60% |
33% | ||||
Secured Debt to Total Assets cannot exceed 40% |
15% | ||||
Total Unencumbered Assets to Unsecured Debt must be at least 1.5/1 |
4.3x | ||||
Consolidated Income Available for Debt Service Charge must be at least 1.5/1 |
3.7x |
1) | A summary of the public debt covenant calculations and reconciliations of the financial components used in the public debt covenant calculations to the most comparable GAAP financial measures is detailed below. |
Ratio of Consolidated Debt to Total Assets |
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As of September 30, 2012 |
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Consolidated debt, per balance sheet (A) |
$ | 1,036,492 | ||
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Total assets, as defined (B) (Table A) |
$ | 3,101,350 | ||
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Computed ratio (A÷B) |
33% | |||
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Required ratio (cannot exceed) |
60% | |||
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Ratio of Secured Debt to Total Assets |
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Total secured debt (C) |
$ | 456,401 | ||
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Computed ratio (C÷B) |
15% | |||
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Required ratio (cannot exceed) |
40% | |||
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Ratio of Total Unencumbered Assets to Unsecured Debt |
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Consolidated debt, per balance sheet (A) |
$ | 1,036,492 | ||
Total secured debt (C) |
(456,401) | |||
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Total unsecured debt (D) |
$ | 580,091 | ||
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Total unencumbered assets, as defined (E) (Table A) |
$ | 2,487,072 | ||
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Computed ratio (E÷D) |
4.3x | |||
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Required minimum ratio |
1.5x | |||
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Ratio of Consolidated Income Available for Debt Service to Annual
Debt |
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Consolidated Income Available for Debt Service, as defined (F) (Table B) |
$ | 181,335 | ||
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Annual Debt Service Charge, as defined (G) (Table B) |
$ | 48,712 | ||
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Computed ratio (F÷G) |
3.7x | |||
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Required minimum ratio |
1.5x | |||
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Supplemental Financial Data | 11 | Page |
DEBT SUMMARY (CONT)
(In thousands) - (Unaudited)
Table A
Calculation of Total Assets and Total Unencumbered Assets for Public Debt Covenant Computations
As
of September 30, 2012 |
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Total real estate assets |
$ | 2,177,745 | ||
Add: |
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Investments in and advances to unconsolidated real estate entities |
5,040 | |||
Accumulated depreciation |
825,015 | |||
Other tangible assets |
93,550 | |||
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Total assets for public debt covenant computations |
3,101,350 | |||
Less: |
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Encumbered real estate assets |
(609,238 | ) | ||
Investments in and advances to unconsolidated real estate entities |
(5,040 | ) | ||
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Total unencumbered assets for public debt covenant computations |
$ | 2,487,072 | ||
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Table B
Calculation of Consolidated Income Available for Debt Service and Annual Debt Service Charge Annualized (1)
Consolidated income available for debt service |
Nine months
ended September 30, 2012 |
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Net income |
$ | 65,357 | ||
Add: |
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Depreciation |
59,172 | |||
Depreciation and amort. (company share) of assets held in unconsolidated entities |
972 | |||
Amortization of deferred financing costs |
2,026 | |||
Interest expense |
34,564 | |||
Interest expense (company share) of assets held in unconsolidated entities |
1,970 | |||
Income tax expense, net |
469 | |||
Other non-cash (income) expense, net |
2,920 | |||
Net loss on early extinguishment of indebtedness |
301 | |||
Less: |
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Gain on sale of real estate assets - unconsolidated entity, net |
(6,055 | ) | ||
Gains on sales of real estate assets, net |
(25,695 | ) | ||
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Consolidated income available for debt service |
$ | 136,001 | ||
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Consolidated income available for debt service (annualized) |
$ | 181,335 | ||
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Annual debt service charge |
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Consolidated interest expense |
$ | 34,564 | ||
Interest expense (company share) of assets held in unconsolidated entities |
1,970 | |||
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Debt service charge |
$ | 36,534 | ||
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Debt service charge (annualized) |
$ | 48,712 | ||
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1) | The actual calculation of these ratios requires the use of annual trailing financial data. These computations reflect annualized 2012 results for comparison and presentation purposes. The computations using annual trailing financial data also reflect compliance with the debt covenants. |
Supplemental Financial Data | 12 | Page |
SUMMARY OF APARTMENT COMMUNITIES UNDER DEVELOPMENT,
LAND HELD FOR FUTURE INVESTMENT AND ACQUISITION/DISPOSITION ACTIVITY
(In millions, except units, square footage and acreage) (Unaudited)
Communities Under Development
Community |
Location | Number of Units |
Retail Sq. Ft. (1) |
Estimated Total Cost (2) |
Costs Incurred as of 09/30/2012 |
Quarter of First Units Available |
Estimated
Quarter of Stabilized Occupancy (3) |
Percent Leased (4) | ||||||||||||||||
Post Carlyle Square - Phase II |
Wash. DC | 344 | | $ | 89.0 | $ | 80.3 | 2Q 2012 | 4Q 2013 | 42.7% | ||||||||||||||
Post South Lamar |
Austin, TX | 298 | 9,263 | 41.7 | 34.0 | 3Q 2012 | 4Q 2013 | 11.7% | ||||||||||||||||
Post Midtown Square® - Phase III |
Houston, TX | 124 | 10,358 | 21.8 | 18.1 | 4Q 2012 | 4Q 2013 | 3.2% | ||||||||||||||||
Post Lake® at Baldwin Park - Phase III |
Orlando, FL | 410 | | 58.6 | 22.7 | 1Q 2013 | 3Q 2014 | N/A | ||||||||||||||||
Post Parkside at Wade - Phase I |
Raleigh, NC | 397 | 14,908 | 55.0 | 21.4 | 1Q 2013 | 3Q 2014 | N/A | ||||||||||||||||
Post Richmond Avenue |
Houston, TX | 242 | | 34.3 | 10.0 | 3Q 2013 | 4Q 2014 | N/A | ||||||||||||||||
Post Soho Square |
Tampa, FL | 231 | 10,556 | 39.8 | 6.1 | 1Q 2014 | 2Q 2015 | N/A | ||||||||||||||||
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Total |
2,046 | 45,085 | $ | 340.2 | $ | 192.6 | ||||||||||||||||||
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1) | Square footage amounts are approximate. Actual square footage may vary. |
2) | To the extent that developments contain a retail component, total estimated cost includes estimated first generation tenant improvements and leasing commissions. |
3) | The Company defines stabilized occupancy as the earlier to occur of (i) the attainment of 95% physical occupancy on the first day of any month or (ii) one year after completion of construction. |
4) | Represents unit status as of October 26, 2012. |
Land Held for Future Investment
The following are land positions (including pre-development costs incurred to date) that the Company currently holds. There can be no assurance that projects held for future investment will be developed in the future or at all.
Project |
Metro Area |
Carrying Value At September 30, 2012 (in thousands) |
Estimated
Usable Acreage |
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Alexander |
Atlanta, GA | $ | 6,652 | 2.5 | ||||||
Centennial Park |
Atlanta, GA | 18,858 | 5.6 | |||||||
Millennium |
Atlanta, GA | 2,775 | 1.0 | |||||||
Spring Hill |
Atlanta, GA | 2,023 | 9.1 | |||||||
Frisco Bridges II |
Dallas, TX | 5,480 | 5.4 | |||||||
Wade |
Raleigh, NC | 10,169 | 26.6 | |||||||
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Total Land Held for Future Investment |
$ | 45,957 | 50.2 | |||||||
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Acquisition/Disposition Activity
Property Name |
Location | Quarter Acquired / Disposed |
Units | Retail Sq. Ft. |
Year Completed |
Gross Price (in thousands) |
Cap Rate |
Companys Ownership % | ||||||||
Acquisitions |
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Post Katy Trail |
Dallas, TX | Q4 2011 | 227 | 9,080 | 2010 | $48,500 | 5.0%(1) | 100% | ||||||||
Post South End |
Charlotte, NC | Q3 2012 | 360 | 7,612 | 2009 | $74,000 | 5.0%(1) | 100% | ||||||||
Dispositions |
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Post Biltmore |
Atlanta, GA | Q1 2012 | 276 | | 2002 | $51,075 | 4.8%(2) | 35% |
1) | Based on projected first twelve-month net operating income after adjustments for management fee (3.0%) and capital reserves ($300/unit). Also assumes the Company will initially spend approximately $0.5 million relating to closing costs and other amounts it plans to spend to improve the community. |
2) | Based on trailing twelve-month net operating income after adjustments for management fee (3%) and capital reserves ($300/unit). |
Supplemental Financial Data | 13 | Page |
SUMMARY OF CONDOMINIUM PROJECTS
(In thousands, except unit and square foot data) - (Unaudited)
The Ritz-Carlton | Four Seasons | |||||||||||||||
Residences, | Private Residences, | |||||||||||||||
Atlanta Buckhead | Austin | |||||||||||||||
Project Data |
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Location |
Atlanta, GA | Austin, TX | ||||||||||||||
Residential square footage |
245,539 | 292,741 | ||||||||||||||
Average unit square footage (1) |
1,903 | 1,978 | ||||||||||||||
Quarter of first units available |
3Q10 | 2Q10 | ||||||||||||||
Units as of 10/26/12 (2) |
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Closed |
71 | 117 | ||||||||||||||
Under contract |
14 | 8 | ||||||||||||||
Available for sale |
44 | 23 | ||||||||||||||
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Total |
129 | 148 | ||||||||||||||
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Per Sq. Ft. | Per Sq. Ft. | |||||||||||||||
Quarterly Data |
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Balance Sheet/Cost Data as of 9/30/12 |
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Condominium book value |
$ | 11,741 | $ | 20,325 | ||||||||||||
Condominium estimated cost to complete |
$ | 2,070 | $ | 1,096 | ||||||||||||
Estimated book value at completion |
$ | 13,811 | $ | 121 | $ | 21,421 | $ | 298 | ||||||||
Projected total cost (before impairment losses) |
$ | 112,700 | $ | 459 | $ | 138,500 | $ | 473 | ||||||||
Units Closed as of 9/30/12 |
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Quarter |
15 | 9 | ||||||||||||||
Year to date |
38 | 31 | ||||||||||||||
Project to date |
67 | 117 | ||||||||||||||
Square Footage of Units Closed as of 9/30/12 (1) |
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Quarter |
25,173 | 22,183 | ||||||||||||||
Year to date |
72,852 | 57,486 | ||||||||||||||
Project to date |
131,334 | 220,759 | ||||||||||||||
Gross Revenue as of 9/30/12 |
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Quarter |
$ | 9,184 | $ | 365 | $ | 14,333 | $ | 646 | ||||||||
Year to date |
$ | 27,777 | $ | 381 | $ | 36,266 | $ | 631 | ||||||||
Project to date |
$ | 51,487 | $ | 392 | $ | 136,747 | $ | 619 | ||||||||
Cash flow from sales as of 9/30/12 (3) |
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Quarter |
$ | 7,044 | $ | 280 | $ | 11,816 | $ | 533 | ||||||||
Year to date |
$ | 19,293 | $ | 265 | $ | 29,620 | $ | 515 | ||||||||
Project to date |
$ | 32,461 | $ | 247 | $ | 109,505 | $ | 496 |
1) | Average square footage information is based on approximate amounts, and individual unit sizes may vary. |
2) | Units under contract includes all units currently under contract. However, the Company has experienced contract terminations in these and other condominium projects when units become available for delivery and may experience additional terminations in connection with existing projects. Accordingly, there can be no assurance that condominium units under contract will close. |
3) | Amounts represent approximate cash flows from condominium activities beginning in the period of initial closings for each community. |
Supplemental Financial Data | 14 | Page |
CAPITALIZED COSTS SUMMARY
(In thousands) - (Unaudited)
The Company has a policy of capitalizing those expenditures relating to the acquisition of new assets and the development, construction and rehabilitation of apartment and condominium communities. In addition, the Company capitalizes expenditures that enhance the value of existing assets and expenditures that substantially extend the life of existing assets. All other expenditures necessary to maintain a community in ordinary operating condition are expensed as incurred. Additionally, for new development communities, carpet, vinyl and blind replacements are expensed as incurred during the first five years (which corresponds to the estimated depreciable life of these assets) after construction completion. Thereafter, these replacements are capitalized. Further, the Company expenses as incurred the interior and exterior painting of operating communities, unless those communities are under major rehabilitation.
The Company capitalizes interest, real estate taxes, and certain internal personnel and associated costs related to apartment and condominium communities under development, construction, and major rehabilitation. The internal personnel and associated costs are capitalized to the projects under development based upon the effort identifiable with such projects. The Company treats each unit in an apartment and condominium community separately for cost accumulation, capitalization and expense recognition purposes. Prior to the commencement of leasing and sales activities, interest and other construction costs are capitalized and are reflected on the balance sheet as construction in progress. The Company ceases the capitalization of such costs as the residential units in a community become substantially complete and available for occupancy. This results in a proration of these costs between amounts that are capitalized and expensed as the residential units in a development community become available for occupancy. In addition, prior to the completion of units, the Company expenses as incurred substantially all operating expenses (including pre-opening marketing and property management and leasing personnel expenses) of such communities.
A summary of community acquisition and development improvements and other capitalized expenditures for the three and nine months ended September 30, 2012 and 2011 is provided below.
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
New community development and acquisition activity (1) |
$ | 103,331 | $ | 21,701 | $ | 177,697 | $ | 56,240 | ||||||||
Periodically recurring capital expenditures |
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Community rehabilitation and other revenue generating improvements (2) |
1,212 | 530 | 2,522 | 1,254 | ||||||||||||
Other community additions and improvements (3) |
2,214 | 1,875 | 5,736 | 5,443 | ||||||||||||
Annually recurring capital expenditures |
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Carpet replacements and other community additions and improvements (4) |
4,672 | 5,458 | 12,152 | 11,978 | ||||||||||||
Corporate additions and improvements |
76 | 440 | 521 | 926 | ||||||||||||
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$ | 111,505 | $ | 30,004 | $ | 198,628 | $ | 75,841 | |||||||||
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Other Data |
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Capitalized interest |
$ | 1,414 | $ | 886 | $ | 4,414 | $ | 1,892 | ||||||||
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Capitalized development and associated costs (5) |
$ | 973 | $ | 879 | $ | 2,692 | $ | 1,975 | ||||||||
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1) | Reflects aggregate community acquisition and development costs, exclusive of the change in construction payables and assumed debt, if any, between years. In the three and nine months ended September 30, 2012, the Company acquired one mixed-use community for a purchase price of approximately $74,000. There was no acquisition activity for the three or nine months ended September 30, 2011. |
2) | Represents expenditures for community rehabilitations and other unit upgrade costs that enhance the rental value of such units. |
3) | Represents community improvement expenditures (e.g. property upgrades) that generally occur less frequently than on an annual basis. |
4) | Represents community improvement expenditures (e.g. carpets, appliances) of a type that are expected to be incurred on an annual basis. |
5) | Reflects internal personnel and associated costs capitalized to construction and development activities. |
Supplemental Financial Data | 15 | Page |
INVESTMENTS IN UNCONSOLIDATED REAL ESTATE ENTITIES
(In thousands) - (Unaudited)
The Company holds investments in limited liability companies (the Property LLCs) with institutional investors and accounts for its investments in these Property LLCs using the equity method of accounting. A summary of non-financial and financial information for the Property LLCs is provided below.
Non-Financial Data |
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Property | Ownership | |||||||||
Joint Venture Property |
Location | Type | # of Units | Interest | ||||||
Post Collier Hills® (1) |
Atlanta, GA | Apartments | 396 | 25 | % | |||||
Post Crest® (1) |
Atlanta, GA | Apartments | 410 | 25 | % | |||||
Post Lindbergh® (1) |
Atlanta, GA | Apartments | 396 | 25 | % | |||||
Post Massachusetts Avenue |
Washington, D.C. | Apartments | 269 | 35 | % |
Financial Data |
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As of | Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||||||
September 30, 2012 | September 30, 2012 | September 30, 2012 | ||||||||||||||||||||||||||||||||||||||
Gross | Companys | Companys | Mgmt. | Companys | Mgmt. | |||||||||||||||||||||||||||||||||||
Joint Venture |
Investment
in Real Estate (6) |
Mortgage Notes Payable |
Entity Equity |
Equity Investment |
Entity NOI |
Equity
in Income (Loss) |
Fees & Other |
Entity NOI |
Equity in Income (Loss) |
Fees & Other |
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Post Collier Hills® (1) |
$ | 55,065 | $ | 39,565 | (2) | $ | 9,224 | $ | (4,646 | ) (1) | $ | 678 | $ | (5 | ) | $ | 2,066 | $ | (4 | ) | ||||||||||||||||||||
Post Crest® (1) |
64,453 | 46,158 | (2) | 10,621 | (7,019 | ) (1) | 772 | (8 | ) | 2,282 | (29 | ) | ||||||||||||||||||||||||||||
Post Lindbergh® (1) |
60,773 | 41,000 | (3) | 13,765 | (4,527 | ) (1) | 742 | (1 | ) | 2,201 | (11 | ) | ||||||||||||||||||||||||||||
Post Biltmore (7) |
| | 677 | 269 | | | | 6,034 | ||||||||||||||||||||||||||||||||
Post Massachusetts Avenue |
70,749 | 51,000 | (4) | 5,434 | 4,771 | 1,859 | 489 | 5,551 | 1,426 | |||||||||||||||||||||||||||||||
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Total |
$ | 251,040 | $ | 177,723 | $ | 39,721 | $ | (11,152 | ) | $ | 4,051 | $ | 475 | $ | 208 (5) | $ | 12,100 | $ | 7,416 | $ | 623 (5) | |||||||||||||||||||
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1) | The Companys investment in the 25% owned Property LLC resulted from the transfer of three previously owned apartment communities to the Property LLC co-owned with an institutional investor. The assets, liabilities and members equity of the Property LLC were recorded at fair value based on agreed-upon amounts contributed to the venture. The credit investments in the Companys 25% owned Property LLC resulted from financing proceeds distributed in excess of the Companys historical cost-basis investment. These credit investments are reflected in consolidated liabilities on the Companys consolidated balance sheet. |
2) | These notes bear interest at a fixed rate of 5.63% and mature in June 2017. |
3) | This note bears interest at a fixed rate of 5.71% and matures in January 2018, at which time it will be automatically extended for a one-year term at a variable interest rate. |
4) | This note bears interest at a fixed rate of 3.5% and matures in February 2019. The note is prepayable without penalty beginning in February 2017. |
5) | Amounts include net property and asset management fees to the Company included in Other Revenues in the Companys consolidated statements of operations. |
6) | Represents GAAP basis net book value plus accumulated depreciation. |
7) | The unconsolidated entity that owned this apartment community sold it to a third party for gross proceeds of approximately $51,075 in February 2012. The mortgage note of $29,272 was repaid in full upon the sale of the apartment community, and the cash proceeds were distributed to its members. The Company recognized its share of the gain on the sale of this community of $6,055 in its equity in earnings of unconsolidated entities on the consolidated statement of operations for the nine months ended September 30, 2012. Entity NOI through the date of sale was excluded from the above table since amounts are reported as discontinued operations at the unconsolidated entity level. |
Supplemental Financial Data | 16 | Page |
NET ASSET VALUE SUPPLEMENTAL INFORMATION (1)
(In thousands, except unit data, commercial square feet and stock price) - (Unaudited)
Financial Data
Income Statement Data |
Three months
ended September 30, 2012 |
Adjustments | As Adjusted (3) |
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Rental revenues |
$ | 81,069 | $ | (2,407 | ) (2) | $ | 78,662 | |||||
Other property revenues |
5,096 | (39 | ) (2) | 5,057 | ||||||||
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Total rental and other revenues (A) |
86,165 | (2,446 | ) | 83,719 | ||||||||
Property operating & maintenance expenses (excluding depreciation and amortization) (B) |
37,341 | (5,151 | ) (2) | 32,190 | ||||||||
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Property net operating income (Table 1) (A-B) |
$ | 48,824 | $ | 2,705 | $ | 51,529 | ||||||
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Assumed property management fee (calculated at 3% of revenues) (A x 3%) |
(2,512 | ) | ||||||||||
Assumed property capital expenditure reserve ($300 per unit per year based on 18,691 units) |
(1,402 | ) | ||||||||||
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Adjusted property net operating income |
$ | 47,615 | ||||||||||
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Annualized property net operating income (C) |
$ | 190,460 | ||||||||||
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Apartment units represented (D) |
22,218 | (3,527 | ) (2) | 18,691 | ||||||||
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Other Asset Data |
As
of September 30, 2012 |
Adjustments | As Adjusted |
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Cash & equivalents |
$ | 64,222 | $ | | $ | 64,222 | ||||||
Real estate assets acquired, at cost (10) |
| 74,000 | (10) | 74,000 | ||||||||
Real estate assets under construction, at cost (4) |
115,594 | 76,957 | 192,551 | |||||||||
Land held for future investment |
45,957 | | 45,957 | |||||||||
For-sale condominiums |
32,066 | | 32,066 | |||||||||
Investments in and advances to unconsolidated real estate entities (5) |
5,040 | (5,040 | ) (5) | | ||||||||
Restricted cash and other assets (10) |
37,280 | (666 | ) (10) | 36,614 | ||||||||
Cash & other assets of unconsolidated apartment entities (6) |
4,965 | (3,524 | ) (6) | 1,441 | ||||||||
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Total (E) |
$ | 305,124 | $ | 141,727 | $ | 446,851 | ||||||
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Other Liability Data |
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Indebtedness (7) |
$ | 1,036,492 | $ | (10,941 | ) (7) | $ | 1,025,551 | |||||
Investments in unconsolidated real estate entities (5) |
16,192 | (16,192 | ) (5) | | ||||||||
Other liabilities (including noncontrolling interests) (8) |
121,346 | (7,653 | ) (8) | 113,693 | ||||||||
Total liabilities of unconsolidated apartment entities (9) |
179,651 | (129,575 | ) (9) | 50,076 | ||||||||
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Total (F) |
$ | 1,353,681 | $ | (164,361 | ) | $ | 1,189,320 | |||||
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Other Data |
As of September 30, 2012 | |||||||||||
# Shares/Units | Stock Price | Implied Value | ||||||||||
Liquidation value of preferred shares (G) |
$ | 43,392 | ||||||||||
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Common shares outstanding |
54,413 | |||||||||||
Common units outstanding |
143 | |||||||||||
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Total (H) |
54,556 | $ | 47.96 | $ | 2,616,506 | |||||||
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Implied market value of Company gross real estate assets (I) = (F+G+H-E) |
$ | 3,402,367 | ||||||||||
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Implied Portfolio Capitalization Rate (C÷I) |
5.6 | % | ||||||||||
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1) | This supplemental financial and other data provides adjustments to certain GAAP financial measures and Net Operating Income (NOI), which is a supplemental non-GAAP financial measure that the Company uses internally to calculate Net Asset Value (NAV). These measures, as adjusted, are also non-GAAP financial measures. With the exception of NOI, the most comparable GAAP measure for each of the non-GAAP measures presented below in the As Adjusted column is the corresponding number presented in the first column listed below. |
The Company presents NOI for the quarter ended September 30, 2012, for properties stabilized as of July 1, 2012, so that a capitalization rate may be applied and an approximate value for the assets determined. Properties not stabilized as of July 1, 2012, are presented at full undepreciated cost. Other tangible assets, total liabilities and the liquidation value of preferred shares are also presented.
Supplemental Financial Data | 17 | Page |
2) | The following table summarizes the adjustments made to the components of property net operating income for the three months ended September 30, 2012, to adjust property net operating income to the Companys share for fully stabilized communities: |
Rental Revenue | Other Revenue | Expenses | Units | |||||||||||||
Communities acquired |
$ | (1,159 | ) | $ | (60 | ) | $ | (428 | ) | (360 | ) | |||||
Communities in lease-up |
(479 | ) | (43 | ) | (642 | ) | (2,046 | ) | ||||||||
Company share of unconsolidated entities |
1,805 | 134 | 660 | (1,077 | ) | |||||||||||
Minority share of consolidated real estate entity |
(549 | ) | (5 | ) | (230 | ) | (44 | ) | ||||||||
Corporate property management expenses |
| | (2,792 | ) | | |||||||||||
Corporate apartments and other |
(2,025 | ) | (65 | ) | (1,719 | ) | | |||||||||
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$ | (2,407 | ) | $ | (39 | ) | $ | (5,151 | ) | (3,527 | ) | ||||||
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3) | The following table summarizes the Companys share of the As Adjusted components of property net operating income, apartment units and commercial square feet by market for the three months ended September 30, 2012: |
Rental and Other Revenues |
Property Operating
& Maintenace Expenses (ex. Deprec. and Amort.) |
Property Net Operating Income (NOI) |
Percentage of Total NOI |
Apartment Units
/ Commercial Sq. Ft. |
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Atlanta |
$ | 21,996 | $ | 8,863 | $ | 13,133 | 25.5 | % | 5,707 | |||||||||||
Washington DC |
14,207 | 4,403 | 9,804 | 19.0 | % | 2,395 | ||||||||||||||
Dallas |
17,362 | 7,561 | 9,801 | 19.0 | % | 4,725 | ||||||||||||||
Tampa |
8,851 | 3,275 | 5,576 | 10.8 | % | 2,111 | ||||||||||||||
Charlotte |
4,985 | 1,672 | 3,313 | 6.4 | % | 1,388 | ||||||||||||||
New York |
3,155 | 1,382 | 1,773 | 3.4 | % | 293 | ||||||||||||||
Houston |
3,446 | 1,407 | 2,039 | 4.0 | % | 837 | ||||||||||||||
Orlando |
2,777 | 1,042 | 1,735 | 3.4 | % | 598 | ||||||||||||||
Austin |
2,845 | 1,249 | 1,596 | 3.1 | % | 637 | ||||||||||||||
Commercial |
4,095 | 1,336 | 2,759 | 5.4 | % | | ||||||||||||||
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Total |
$ | 83,719 | $ | 32,190 | $ | 51,529 | 100.0 | % | 18,691 | |||||||||||
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Approximate commercial Sq. Ft. |
700,000 | |||||||||||||||||||
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4) | The As Adjusted amount represents the CIP balance per the Companys balance sheet consisting of the following: |
Post Carlyle Square - Phase II |
$ | 80,290 | ||||
Post South Lamar |
33,973 | |||||
Post Midtown Square® - Phase III |
18,121 | |||||
Post Parkside at Wade - Phase I |
21,385 | |||||
Post Lake® at Baldwin Park - Phase III |
22,683 | |||||
Post Richmond Avenue |
9,987 | |||||
Post Soho Square |
6,112 | |||||
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$ | 192,551 | |||||
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5) | The adjustment reflects a reduction for the investments in unconsolidated entities, as the Companys respective share of net operating income of such investments is included in the adjusted net operating income reflected above. |
6) | The As of September 30, 2012 amount represents cash and other assets of unconsolidated apartment entities. The adjustment includes a reduction for the venture partners respective share of cash and other assets. The As Adjusted amount represents the Companys respective share of the cash and other assets of unconsolidated apartment entities. |
7) | The adjustment reflects a reduction for the minority interest portion of the consolidated mortgage debt of a consolidated joint venture community. Likewise, only the Companys majority share of that community is included in the adjusted net operating income reflected above. |
8) | The As of September 30, 2012 amount consists of the sum of accrued interest payable, dividends and distributions payable, accounts payable and accrued expenses and security deposits and prepaid rents as reflected on the Companys balance sheet. The adjustment represents a reduction for the non-cash liability associated with straight-line, long-term ground lease expense of $7,704, offset by the addition of noncontrolling interests of consolidated real estate entities of $51. |
9) | The As of September 30, 2012 amount represents total liabilities of unconsolidated apartment entities. The adjustment represents a reduction for the venture partners respective share of liabilities. The As Adjusted amount represents the Companys respective share of liabilities of unconsolidated apartment entities. |
10) | This adjustment represents the undepreciated real estate assets of Post South End acquired during the third quarter of 2012 and which was excluded from net operating income reflected above. Certain assets acquired totaling $666 were reflected in other assets under GAAP. |
Supplemental Financial Data | 18 | Page |
NON-GAAP FINANCIAL MEASURES AND OTHER DEFINED TERMS
Definitions of Supplemental Non-GAAP Financial Measures and Other Defined Terms
The Company uses certain non-GAAP financial measures and other defined terms in this accompanying Supplemental Financial Data. These non-GAAP financial measures include FFO, AFFO, net operating income, same store capital expenditures and certain debt statistics and ratios. The definitions of these non-GAAP financial measures are summarized below. The Company believes that these measures are helpful to investors in measuring financial performance and/or liquidity and comparing such performance and/or liquidity to other REITs.
Funds from Operations - The Company uses FFO as an operating measure. The Company uses the NAREIT definition of FFO. FFO is defined by NAREIT to mean net income (loss) available to common shareholders determined in accordance with GAAP, excluding gains (losses) from extraordinary items and sales of depreciable operating property, plus depreciation and amortization of real estate assets, and after adjustment for unconsolidated partnerships and joint ventures all determined on a consistent basis in accordance with GAAP. FFO presented in the Companys press release and Supplemental Financial Data is not necessarily comparable to FFO presented by other real estate companies because not all real estate companies use the same definition. The Companys FFO is comparable to the FFO of real estate companies that use the current NAREIT definition.
Accounting for real estate assets using historical cost accounting under GAAP assumes that the value of real estate assets diminishes predictably over time. NAREIT stated in its April 2002 White Paper on Funds from Operations that since real estate asset values have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. As a result, the concept of FFO was created by NAREIT for the REIT industry to provide an alternate measure. Since the Company agrees with the concept of FFO and appreciates the reasons surrounding its creation, the Company believes that FFO is an important supplemental measure of operating performance. In addition, since most equity REITs provide FFO information to the investment community, the Company believes that FFO is a useful supplemental measure for comparing the Companys results to those of other equity REITs. The Company believes that the line on its consolidated statement of operations entitled net income (loss) available to common shareholders is the most directly comparable GAAP measure to FFO.
Adjusted Funds From Operations - The Company also uses adjusted funds from operations (AFFO) as an operating measure. AFFO is defined as FFO less operating capital expenditures after adjusting for the impact of non-cash straight-line long-term ground lease expense, non-cash impairment charges, debt extinguishment gains (losses) and preferred stock redemption costs. The Company believes that AFFO is an important supplemental measure of operating performance for an equity REIT because it provides investors with an indication of the REITs ability to fund operating capital expenditures through earnings. In addition, since most equity REITs provide AFFO information to the investment community, the Company believes that AFFO is a useful supplemental measure for comparing the Company to other equity REITs. The Company believes that the line on its consolidated statement of operations entitled net income (loss) available to common shareholders is the most directly comparable GAAP measure to AFFO.
Property Net Operating Income - The Company uses property NOI, including same store NOI and same store NOI by market, as an operating measure. NOI is defined as rental and other revenues from real estate operations less total property and maintenance expenses from real estate operations (exclusive of depreciation and amortization). The Company believes that NOI is an important supplemental measure of operating performance for a REITs operating real estate because it provides a measure of the core operations, rather than factoring in depreciation and amortization, financing costs and general and administrative expenses generally incurred at the corporate level. This measure is particularly useful, in the opinion of the Company, in evaluating the performance of geographic operations, same store groupings and individual properties. Additionally, the Company believes that NOI, as defined, is a widely accepted measure of comparative operating performance in the real estate investment community. The Company believes that the line on its consolidated statement of operations entitled net income (loss) is the most directly comparable GAAP measure to NOI.
Supplemental Financial Data | 19 | Page |
Same Store Capital Expenditures - The Company uses same store annually recurring and periodically recurring capital expenditures as cash flow measures. Same store annually recurring and periodically recurring capital expenditures are supplemental non-GAAP financial measures. The Company believes that same store annually recurring and periodically recurring capital expenditures are important indicators of the costs incurred by the Company in maintaining its same store communities on an ongoing basis. The corresponding GAAP measures include information with respect to the Companys other operating segments consisting of communities stabilized in the prior year, lease-up communities, rehabilitation communities, sold properties and commercial properties in addition to same store information. Therefore, the Company believes that the Companys presentation of same store annually recurring and periodically recurring capital expenditures is necessary to demonstrate same store replacement costs over time. The Company believes that the most directly comparable GAAP measure to same store annually recurring and periodically recurring capital expenditures is the line on the Companys consolidated statements of cash flows entitled property capital expenditures, which also includes revenue generating capital expenditures.
Debt Statistics and Debt Ratios - The Company uses a number of debt statistics and ratios as supplemental measures of liquidity. The numerator and/or the denominator of certain of these statistics and/or ratios include non-GAAP financial measures that have been reconciled to the most directly comparable GAAP financial measure. These debt statistics and ratios include: (1) interest coverage ratios; (2) fixed charge coverage ratios; (3) total debt as a percentage of undepreciated real estate (adjusted for joint venture partners share of debt); (4) total debt plus preferred equity as a percentage of undepreciated real estate (adjusted for joint venture partners share of debt); (5) a ratio of consolidated debt to total assets; (6) a ratio of secured debt to total assets; (7) a ratio of total unencumbered assets to unsecured debt; (8) a ratio of consolidated income available for debt service to annual debt service charge; and (9) a debt to annualized income available for debt service ratio. A number of these debt statistics and ratios are derived from covenants found in the Companys debt agreements, including, among others, the Companys senior unsecured notes. In addition, the Company presents these measures because the degree of leverage could affect the Companys ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes. The Company uses these measures internally as an indicator of liquidity, and the Company believes that these measures are also utilized by the investment and analyst communities to better understand the Companys liquidity.
The Company uses income available for debt service to calculate certain debt ratios and statistics. Income available for debt service is defined as net income (loss) before interest, taxes, depreciation, amortization, gains on sales of real estate assets, non-cash impairment charges and other non-cash income and expenses. Income available for debt service is a supplemental measure of operating performance that does not represent and should not be considered as an alternative to net income or cash flow from operating activities as determined under GAAP, and the Companys calculation thereof may not be comparable to similar measures reported by other companies, including EBITDA or Adjusted EBITDA.
Property Operating Statistics The Company uses average economic occupancy, gross turnover, net turnover and percentage increases in rent for new and renewed leases as statistical measures of property operating performance. The Company defines average economic occupancy as gross potential rent less vacancy losses, model expenses and bad debt expenses divided by gross potential rent for the period, expressed as a percentage. Gross turnover is defined as the percentage of leases expiring during the period that are not renewed by the existing residents. Net turnover is defined as gross turnover decreased by the percentage of expiring leases where the residents transfer to a new apartment unit in the same community or in another Post® community. The percentage increases in rent for new and renewed leases are calculated using the respective new or renewed rental rate as of the date of a new lease, as compared with the previous rental rate on that same unit.
Supplemental Financial Data | 20 | Page |
RECONCILIATIONS OF SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
Table 1 - Reconciliation of Same Store Net Operating Income (NOI) to GAAP Net Income
(In thousands) - (Unaudited)
Three months ended | Nine months ended | |||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
June 30, 2012 |
September 30, 2012 |
September 30, 2011 |
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Total same store NOI |
$ | 47,185 | $ | 43,271 | $ | 46,202 | $ | 138,453 | $ | 125,748 | ||||||||||
Property NOI from other operating segments |
1,639 | 480 | 521 | 2,511 | 692 | |||||||||||||||
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Consolidated property NOI |
48,824 | 43,751 | 46,723 | 140,964 | 126,440 | |||||||||||||||
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Add (subtract): |
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Interest income |
20 | 374 | 288 | 359 | 982 | |||||||||||||||
Other revenues |
209 | 243 | 206 | 637 | 686 | |||||||||||||||
Depreciation |
(20,334 | ) | (18,823 | ) | (19,497 | ) | (59,172 | ) | (56,383 | ) | ||||||||||
Interest expense |
(11,816 | ) | (14,207 | ) | (11,103 | ) | (34,564 | ) | (43,119 | ) | ||||||||||
Amortization of deferred financing costs |
(667 | ) | (717 | ) | (698 | ) | (2,026 | ) | (2,085 | ) | ||||||||||
General and administrative |
(3,763 | ) | (3,970 | ) | (3,883 | ) | (11,931 | ) | (12,332 | ) | ||||||||||
Investment and development |
(203 | ) | (239 | ) | (322 | ) | (1,005 | ) | (1,013 | ) | ||||||||||
Other investment costs |
(547 | ) | (329 | ) | (306 | ) | (1,159 | ) | (1,278 | ) | ||||||||||
Gains on condominium sales activities, net |
10,261 | 2,581 | 8,530 | 25,695 | 8,757 | |||||||||||||||
Equity in income of unconsolidated real estate entities, net |
475 | 235 | 495 | 7,416 | 790 | |||||||||||||||
Other income (expense), net |
(137 | ) | (71 | ) | 737 | 444 | 230 | |||||||||||||
Net loss on extinguishment of indebtedness |
| | | (301 | ) | | ||||||||||||||
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Net income |
$ | 22,322 | $ | 8,828 | $ | 21,170 | $ | 65,357 | $ | 21,675 | ||||||||||
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Supplemental Financial Data | 21 | Page |
Table 2 - Same Store Net Operating Income (NOI) and Average Rental Rate per Unit by Market
(In thousands, except average rental rates)
Three months ended | Q3
12 vs. Q3 11 % Change |
Q3
12 vs. Q2 12 % Change |
Q3
12 % Same Store NOI | |||||||||||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
June 30, 2012 |
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Rental and other revenues |
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Atlanta |
$ | 20,982 | $ | 19,655 | $ | 20,320 | 6.8% | 3.3% | ||||||||||||||||||||||
Washington, D.C. |
13,283 | 12,837 | 13,108 | 3.5% | 1.3% | |||||||||||||||||||||||||
Dallas |
16,261 | 15,101 | 15,720 | 7.7% | 3.4% | |||||||||||||||||||||||||
Tampa |
8,851 | 8,226 | 8,628 | 7.6% | 2.6% | |||||||||||||||||||||||||
Charlotte |
5,013 | 4,594 | 4,845 | 9.1% | 3.5% | |||||||||||||||||||||||||
New York |
3,709 | 3,580 | 3,668 | 3.6% | 1.1% | |||||||||||||||||||||||||
Houston |
3,446 | 3,135 | 3,359 | 9.9% | 2.6% | |||||||||||||||||||||||||
Orlando |
2,777 | 2,583 | 2,711 | 7.5% | 2.4% | |||||||||||||||||||||||||
Austin |
2,845 | 2,619 | 2,770 | 8.6% | 2.7% | |||||||||||||||||||||||||
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Total rental and other revenues |
77,167 | 72,330 | 75,129 | 6.7% | 2.7% | |||||||||||||||||||||||||
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Property operating and maintenance expenses (exclusive of depreciation and amortization) |
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Atlanta |
8,569 | 7,963 | 8,087 | 7.6% | 6.0% | |||||||||||||||||||||||||
Washington, D.C. |
4,157 | 4,384 | 3,946 | (5.2)% | 5.3% | |||||||||||||||||||||||||
Dallas |
6,996 | 6,691 | 6,655 | 4.6% | 5.1% | |||||||||||||||||||||||||
Tampa |
3,275 | 3,153 | 3,257 | 3.9% | 0.6% | |||||||||||||||||||||||||
Charlotte |
1,675 | 1,729 | 1,742 | (3.1)% | (3.8)% | |||||||||||||||||||||||||
New York |
1,612 | 1,561 | 1,607 | 3.3% | 0.3% | |||||||||||||||||||||||||
Houston |
1,407 | 1,388 | 1,439 | 1.4% | (2.2)% | |||||||||||||||||||||||||
Orlando |
1,042 | 1,028 | 1,001 | 1.4% | 4.1% | |||||||||||||||||||||||||
Austin |
1,249 | 1,162 | 1,193 | 7.5% | 4.7% | |||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||
Total |
29,982 | 29,059 | 28,927 | 3.2% | 3.6% | |||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||
Net operating income |
||||||||||||||||||||||||||||||
Atlanta |
12,413 | 11,692 | 12,233 | 6.2% | 1.5% | 26.4% | ||||||||||||||||||||||||
Washington, D.C. |
9,126 | 8,453 | 9,162 | 8.0% | (0.4)% | 19.3% | ||||||||||||||||||||||||
Dallas |
9,265 | 8,410 | 9,065 | 10.2% | 2.2% | 19.6% | ||||||||||||||||||||||||
Tampa |
5,576 | 5,073 | 5,371 | 9.9% | 3.8% | 11.8% | ||||||||||||||||||||||||
Charlotte |
3,338 | 2,865 | 3,103 | 16.5% | 7.6% | 7.1% | ||||||||||||||||||||||||
New York |
2,097 | 2,019 | 2,061 | 3.9% | 1.7% | 4.4% | ||||||||||||||||||||||||
Houston |
2,039 | 1,747 | 1,920 | 16.7% | 6.2% | 4.3% | ||||||||||||||||||||||||
Orlando |
1,735 | 1,555 | 1,710 | 11.6% | 1.5% | 3.7% | ||||||||||||||||||||||||
Austin |
1,596 | 1,457 | 1,577 | 9.5% | 1.2% | 3.4% | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Total same store NOI |
$ | 47,185 | $ | 43,271 | $ | 46,202 | 9.0% | 2.1% | 100.0% | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Average rental rate per unit |
||||||||||||||||||||||||||||||
Atlanta |
$ | 1,214 | $ | 1,139 | $ | 1,187 | 6.6% | 2.3% | ||||||||||||||||||||||
Washington, D.C. |
1,883 | 1,826 | 1,859 | 3.1% | 1.3% | |||||||||||||||||||||||||
Dallas |
1,160 | 1,080 | 1,137 | 7.4% | 2.1% | |||||||||||||||||||||||||
Tampa |
1,348 | 1,260 | 1,321 | 7.0% | 2.0% | |||||||||||||||||||||||||
Charlotte |
1,167 | 1,071 | 1,129 | 9.0% | 3.4% | |||||||||||||||||||||||||
New York |
3,824 | 3,715 | 3,777 | 2.9% | 1.2% | |||||||||||||||||||||||||
Houston |
1,338 | 1,218 | 1,292 | 9.9% | 3.6% | |||||||||||||||||||||||||
Orlando |
1,487 | 1,383 | 1,447 | 7.5% | 2.7% | |||||||||||||||||||||||||
Austin |
1,466 | 1,350 | 1,421 | 8.6% | 3.2% | |||||||||||||||||||||||||
Total average rental rate per unit |
1,370 | 1,288 | 1,341 | 6.4% | 2.2% |
Supplemental Financial Data | 22 | Page |
Table 2(cont) - Same Store Net Operating Income (NOI) and Average Rental Rate per Unit by Market
(In thousands, except average rental rates)
Nine months ended | |||||||||||||||
September 30, 2012 |
September 30, 2011 |
% Change | |||||||||||||
Rental and other revenues |
|||||||||||||||
Atlanta |
$ | 61,273 | $ | 57,095 | 7.3% | ||||||||||
Washington, D.C. |
39,245 | 37,263 | 5.3% | ||||||||||||
Dallas |
47,103 | 43,569 | 8.1% | ||||||||||||
Tampa |
25,988 | 24,199 | 7.4% | ||||||||||||
Charlotte |
14,521 | 13,301 | 9.2% | ||||||||||||
New York |
10,979 | 10,513 | 4.4% | ||||||||||||
Houston |
10,050 | 9,116 | 10.2% | ||||||||||||
Orlando |
8,150 | 7,575 | 7.6% | ||||||||||||
Austin |
8,307 | 7,421 | 11.9% | ||||||||||||
|
|
|
|
||||||||||||
Total rental and other revenues |
225,616 | 210,052 | 7.4% | ||||||||||||
|
|
|
|
||||||||||||
Property operating and maintenance expenses (exclusive of depreciation and amortization) |
|||||||||||||||
Atlanta |
24,472 | 23,681 | 3.3% | ||||||||||||
Washington, D.C. |
12,126 | 12,080 | 0.4% | ||||||||||||
Dallas |
20,178 | 19,384 | 4.1% | ||||||||||||
Tampa |
9,703 | 9,203 | 5.4% | ||||||||||||
Charlotte |
5,037 | 5,068 | (0.6)% | ||||||||||||
New York |
4,905 | 4,632 | 5.9% | ||||||||||||
Houston |
4,052 | 3,976 | 1.9% | ||||||||||||
Orlando |
3,046 | 3,012 | 1.1% | ||||||||||||
Austin |
3,644 | 3,268 | 11.5% | ||||||||||||
|
|
|
|
||||||||||||
Total |
87,163 | 84,304 | 3.4% | ||||||||||||
|
|
|
|
||||||||||||
Net operating income |
|||||||||||||||
Atlanta |
36,801 | 33,414 | 10.1% | ||||||||||||
Washington, D.C. |
27,119 | 25,183 | 7.7% | ||||||||||||
Dallas |
26,925 | 24,185 | 11.3% | ||||||||||||
Tampa |
16,285 | 14,996 | 8.6% | ||||||||||||
Charlotte |
9,484 | 8,233 | 15.2% | ||||||||||||
New York |
6,074 | 5,881 | 3.3% | ||||||||||||
Houston |
5,998 | 5,140 | 16.7% | ||||||||||||
Orlando |
5,104 | 4,563 | 11.9% | ||||||||||||
Austin |
4,663 | 4,153 | 12.3% | ||||||||||||
|
|
|
|
||||||||||||
Total same store NOI |
$ | 138,453 | $ | 125,748 | 10.1% | ||||||||||
|
|
|
|
||||||||||||
Average rental rate per unit |
|||||||||||||||
Atlanta |
$ | 1,190 | $ | 1,113 | 6.9% | ||||||||||
Washington, D.C. |
1,861 | 1,806 | 3.0% | ||||||||||||
Dallas |
1,138 | 1,061 | 7.3% | ||||||||||||
Tampa |
1,322 | 1,231 | 7.4% | ||||||||||||
Charlotte |
1,134 | 1,043 | 8.7% | ||||||||||||
New York |
3,782 | 3,691 | 2.5% | ||||||||||||
Houston |
1,298 | 1,194 | 8.7% | ||||||||||||
Orlando |
1,453 | 1,358 | 7.0% | ||||||||||||
Austin |
1,429 | 1,316 | 8.6% | ||||||||||||
Total average rental rate per unit |
1,344 | 1,263 | 6.4% |
Supplemental Financial Data | 23 | Page |
Table 3 - Operating Community Table
Year Completed/ |
Avg. | Q3 2012 | Q3 2012 | |||||||||||||||||||||||||||
Market / | Year of | Unit | Avg. Monthly Rent | Average | ||||||||||||||||||||||||||
Submarket / | Substantial | No. of | Size | Per | Per | Economic | ||||||||||||||||||||||||
Community |
Renovations | Units | (Sq. Ft.) | Unit | Sq. Ft. | Occ. | ||||||||||||||||||||||||
Atlanta |
||||||||||||||||||||||||||||||
Buckhead / Brookhaven |
||||||||||||||||||||||||||||||
Post Alexander |
2008 | 307 | 1,016 | $ | 1,644 | $ | 1.62 | 97.5% | ||||||||||||||||||||||
Post Brookhaven® |
1990-1992 | 735 | 933 | 1,034 | 1.11 | 97.3% | ||||||||||||||||||||||||
Post Chastain® |
1990/2008 | 558 | 866 | 1,150 | 1.33 | 98.5% | ||||||||||||||||||||||||
Post Collier Hills® (1)(2) |
1997 | 396 | 948 | 1,058 | 1.12 | 96.7% | ||||||||||||||||||||||||
Post Gardens® |
1998 | 397 | 1,039 | 1,231 | 1.18 | 98.2% | ||||||||||||||||||||||||
Post Glen® (2) |
1997 | 314 | 1,076 | 1,226 | 1.14 | 96.4% | ||||||||||||||||||||||||
Post Lindbergh® (1)(2) |
1998 | 396 | 910 | 1,101 | 1.21 | 99.1% | ||||||||||||||||||||||||
Post Peachtree Hills® |
1992-1994/2009 | 300 | 978 | 1,302 | 1.33 | 97.4% | ||||||||||||||||||||||||
Post StratfordTM |
2000 | 250 | 999 | 1,258 | 1.26 | 97.7% | ||||||||||||||||||||||||
Dunwoody |
||||||||||||||||||||||||||||||
Post Crossing® (2) |
1995 | 354 | 1,036 | 1,109 | 1.07 | 98.5% | ||||||||||||||||||||||||
Emory Area |
||||||||||||||||||||||||||||||
Post BriarcliffTM (2) |
1999 | 688 | 1,006 | 1,200 | 1.19 | 97.0% | ||||||||||||||||||||||||
Midtown |
||||||||||||||||||||||||||||||
Post ParksideTM (2) |
2000 | 188 | 885 | 1,413 | 1.60 | 96.5% | ||||||||||||||||||||||||
Post Renaissance® |
1992-1994 | 342 | 908 | 1,058 | 1.17 | 96.7% | ||||||||||||||||||||||||
Northwest Atlanta |
||||||||||||||||||||||||||||||
Post Crest® (1)(2) |
1996 | 410 | 1,033 | 1,035 | 1.00 | 95.6% | ||||||||||||||||||||||||
Post Riverside® |
1998 | 522 | 1,062 | 1,473 | 1.39 | 96.2% | ||||||||||||||||||||||||
Post SpringTM (2) |
2000 | 452 | 977 | 1,029 | 1.05 | 96.0% | ||||||||||||||||||||||||
Dallas |
||||||||||||||||||||||||||||||
North Dallas |
||||||||||||||||||||||||||||||
Post Addison CircleTM (2) |
1998-2000 | 1,334 | 846 | 1,044 | 1.23 | 96.4% | ||||||||||||||||||||||||
Post EastsideTM |
2008 | 435 | 910 | 1,138 | 1.25 | 94.9% | ||||||||||||||||||||||||
Post Legacy (2) |
2000 | 384 | 810 | 1,023 | 1.26 | 96.1% | ||||||||||||||||||||||||
Post Sierra at Frisco Bridges |
2009 | 268 | 896 | 1,105 | 1.23 | 96.0% | ||||||||||||||||||||||||
Uptown Dallas |
||||||||||||||||||||||||||||||
Post AbbeyTM |
1996 | 34 | 1,223 | 1,878 | 1.54 | 100.0% | ||||||||||||||||||||||||
Post Coles CornerTM |
1998 | 186 | 799 | 1,155 | 1.45 | 97.1% | ||||||||||||||||||||||||
Post GalleryTM |
1999 | 34 | 2,307 | 2,763 | 1.20 | 100.0% | ||||||||||||||||||||||||
Post HeightsTM |
1998-1999/2009 | 368 | 845 | 1,320 | 1.56 | 95.2% | ||||||||||||||||||||||||
Post Katy Trail |
2010 | 227 | 898 | 1,610 | 1.79 | 95.7% | ||||||||||||||||||||||||
Post MeridianTM |
1991 | 133 | 780 | 1,298 | 1.66 | 96.2% | ||||||||||||||||||||||||
Post SquareTM |
1996 | 216 | 863 | 1,270 | 1.47 | 97.6% | ||||||||||||||||||||||||
Post Uptown VillageTM |
1995-2000 | 496 | 735 | 1,090 | 1.48 | 97.3% | ||||||||||||||||||||||||
Post VineyardTM |
1996 | 116 | 733 | 1,145 | 1.56 | 96.6% | ||||||||||||||||||||||||
Post VintageTM |
1993 | 160 | 750 | 1,173 | 1.56 | 97.4% | ||||||||||||||||||||||||
Post WorthingtonTM (2) |
1993/2008 | 334 | 820 | 1,423 | 1.74 | 95.8% |
Supplemental Financial Data | 24 | Page |
Table 3 (cont) - Operating Community Table
Year Completed/ |
Avg. | Q3 2012 | Q3 2012 | |||||||||||||||||||||||||||
Market / | Year of | Unit | Avg. Monthly Rent | Average | ||||||||||||||||||||||||||
Submarket / | Substantial | No. of | Size | Per | Per | Economic | ||||||||||||||||||||||||
Community |
Renovations | Units | (Sq. Ft.) | Unit | Sq. Ft. | Occ. | ||||||||||||||||||||||||
Austin |
||||||||||||||||||||||||||||||
Post Barton Creek |
1998 | 160 | 1,162 | $ | 1,647 | $ | 1.42 | 96.3% | ||||||||||||||||||||||
Post Park Mesa |
1992 | 148 | 1,091 | 1,390 | 1.27 | 96.7% | ||||||||||||||||||||||||
Post West Austin |
2009 | 329 | 889 | 1,413 | 1.59 | 95.6% | ||||||||||||||||||||||||
Houston |
||||||||||||||||||||||||||||||
Post Midtown Square® |
1999-2000 | 529 | 759 | 1,253 | 1.65 | 97.4% | ||||||||||||||||||||||||
Post Rice LoftsTM |
1998 | 308 | 906 | 1,486 | 1.64 | 95.4% | ||||||||||||||||||||||||
Tampa |
||||||||||||||||||||||||||||||
Post Bay at Rocky Point |
1997 | 150 | 1,012 | 1,389 | 1.37 | 95.9% | ||||||||||||||||||||||||
Post Harbour PlaceTM |
1999-2002 | 578 | 920 | 1,467 | 1.59 | 98.9% | ||||||||||||||||||||||||
Post Hyde Park® (2) |
1996-2008 | 467 | 1,011 | 1,421 | 1.41 | 97.6% | ||||||||||||||||||||||||
Post Rocky Point® (2) |
1996-1998 | 916 | 1,031 | 1,229 | 1.19 | 95.1% | ||||||||||||||||||||||||
Orlando |
||||||||||||||||||||||||||||||
Post Lake® at Baldwin Park |
2004-2007 | 350 | 1,013 | 1,523 | 1.50 | 97.7% | ||||||||||||||||||||||||
Post ParksideTM |
1999 | 248 | 852 | 1,435 | 1.68 | 97.3% | ||||||||||||||||||||||||
Charlotte |
||||||||||||||||||||||||||||||
Post Ballantyne (2) |
2004 | 323 | 1,252 | 1,115 | 0.89 | 96.9% | ||||||||||||||||||||||||
Post Gateway PlaceTM (2) |
2000 | 436 | 806 | 1,089 | 1.35 | 96.9% | ||||||||||||||||||||||||
Post Park at Phillips Place® |
1998 | 402 | 1,099 | 1,319 | 1.20 | 97.7% | ||||||||||||||||||||||||
Post South End (4) |
2009 | 360 | 847 | 1,387 | 1.64 | 95.0% | ||||||||||||||||||||||||
Post Uptown PlaceTM |
2000 | 227 | 800 | 1,124 | 1.41 | 98.0% | ||||||||||||||||||||||||
Washington D.C. |
||||||||||||||||||||||||||||||
Maryland |
||||||||||||||||||||||||||||||
Post Fallsgrove |
2003 | 361 | 983 | 1,731 | 1.76 | 95.1% | ||||||||||||||||||||||||
Post Park® |
2010 | 396 | 975 | 1,599 | 1.64 | 96.3% | ||||||||||||||||||||||||
Virginia |
||||||||||||||||||||||||||||||
Post Carlyle Square - Phase I |
2006 | 205 | 861 | 2,435 | 2.83 | 95.5% | ||||||||||||||||||||||||
Post Corners at Trinity Centre (2) |
1996 | 336 | 994 | 1,598 | 1.61 | 96.9% | ||||||||||||||||||||||||
Post Pentagon Row TM |
2001 | 504 | 853 | 2,313 | 2.71 | 95.8% | ||||||||||||||||||||||||
Post Tysons Corner TM |
1990 | 499 | 810 | 1,751 | 2.16 | 94.0% | ||||||||||||||||||||||||
Washington D.C. |
||||||||||||||||||||||||||||||
Post Massachusetts Avenue TM (1)(2) |
2002 | 269 | 884 | 3,106 | 3.51 | 95.8% | ||||||||||||||||||||||||
New York City |
||||||||||||||||||||||||||||||
Post Luminaria TM (2)(3) |
2002 | 138 | 721 | 3,799 | 5.27 | 97.8% | ||||||||||||||||||||||||
Post Toscana TM (2) |
2003 | 199 | 817 | 3,842 | 4.70 | 94.5% |
1) | Communities held in unconsolidated entities. |
2) | Communities encumbered by secured mortgage indebtedness. |
3) | The Company owns a 68% interest in this community. |
4) | Average monthly rent and economic occupancy data reflects the first two full months after acquisition. |
Supplemental Financial Data | 25 | Page |
Table 4 - Year-to-Date Margin Analysis
(In thousands)
Nine months ended September 30, 2012 | |||||||||||||||||||||||||
Rental and Other Property Revenues |
Property Operating & Maintenance Expenses |
Net Operating Income (NOI) |
NOI Margin |
Expense Margin | |||||||||||||||||||||
Same store communities |
$ | 225,616 | $ | 87,163 | $ | 138,453 | 61.4% | 38.6% | |||||||||||||||||
Development and lease-up communities (2)(6) |
599 | 880 | (281 | ) | N/A | N/A | |||||||||||||||||||
Acquired communities |
4,440 | 1,971 | 2,469 | 55.6% | 44.4% | ||||||||||||||||||||
Other property segments: |
|||||||||||||||||||||||||
Corporate apartments |
5,664 | 4,663 | 1,001 | 17.7% | 82.3% | ||||||||||||||||||||
Commercial |
11,854 | 4,030 | 7,824 | 66.0% | 34.0% | ||||||||||||||||||||
Corporate property management expenses (1) |
| 8,502 | (8,502 | ) | |||||||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||||
$ | 248,173 | $ | 107,209 | ||||||||||||||||||||||
|
|
|
|
||||||||||||||||||||||
Consolidated property NOI (2) |
$ | 140,964 | |||||||||||||||||||||||
|
|
||||||||||||||||||||||||
Third-party management fees |
$ | 623 | |||||||||||||||||||||||
|
|
1) | The following table summarizes the Companys net property management expense as a percentage of adjusted property revenues: |
Numerator: |
||||||
Corporate property management expenses |
$ | 8,502 | ||||
Less: Third-party management fees |
(623 | ) | ||||
|
|
|||||
Net property management expenses |
$ | 7,879 | ||||
|
|
|||||
Denominator: |
||||||
Total rental and other property revenues |
$ | 248,173 | ||||
Less: Corporate apartment revenues |
(5,664 | ) | ||||
|
|
|||||
Adjusted property revenues |
$ | 242,509 | ||||
|
|
|||||
Net property management expenses as a percentage of adjusted property revenues |
3.2 | % | ||||
|
|
2) | Consolidated property net operating income (NOI) is a non-GAAP financial measure. See Table 1 on page 21 for a reconciliation of consolidated property NOI to GAAP net income (loss). |
Supplemental Financial Data | 26 | Page |
Table 5 - Reconciliation of Segment Cash Flow Data to Statements of Cash Flows
(In thousands)
Three months
ended September 30, |
Nine months
ended September 30, | |||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||
Annually recurring capital expenditures by operating segment |
||||||||||||||||||||
Same store communities |
$ | 4,207 | $ | 5,308 | $ | 11,184 | $ | 11,638 | ||||||||||||
Development and lease-up |
4 | | 4 | | ||||||||||||||||
Acquired communities |
187 | | 221 | | ||||||||||||||||
Other segments |
274 | 150 | 743 | 340 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total annually recurring capital expenditures |
$ | 4,672 | $ | 5,458 | $ | 12,152 | $ | 11,978 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Periodically recurring capital expenditures by operating segment |
||||||||||||||||||||
Same store communities |
$ | 1,840 | $ | 1,350 | $ | 4,267 | $ | 4,259 | ||||||||||||
Development and lease-up |
5 | | 5 | | ||||||||||||||||
Acquired communities |
16 | | 16 | | ||||||||||||||||
Other segments |
353 | 525 | 1,448 | 1,184 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total periodically recurring capital expenditures |
$ | 2,214 | $ | 1,875 | $ | 5,736 | $ | 5,443 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total revenue generating capital expenditures |
$ | 1,212 | $ | 530 | $ | 2,522 | $ | 1,254 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total property capital expenditures per statements of cash flows |
$ | 8,098 | $ | 7,863 | $ | 20,410 | $ | 18,675 | ||||||||||||
|
|
|
|
|
|
|
|
Table 6 - Computation of Debt Ratios
(In thousands)
As of September 30, | ||||||||||
2012 | 2011 | |||||||||
Total real estate assets per balance sheet |
$ | 2,177,745 | $ | 2,025,333 | ||||||
Plus: |
||||||||||
Company share of real estate assets held in unconsolidated entities |
59,177 | 70,419 | ||||||||
Company share of accumulated depreciation - assets held in unconsolidated entities |
10,658 | 12,091 | ||||||||
Accumulated depreciation per balance sheet |
825,015 | 748,306 | ||||||||
|
|
|
|
|||||||
Total undepreciated real estate assets (A) |
$ | 3,072,595 | $ | 2,856,149 | ||||||
|
|
|
|
|||||||
Total debt per balance sheet |
$ | 1,036,492 | $ | 1,030,852 | ||||||
Plus: |
||||||||||
Company share of third party debt held in unconsolidated entities |
49,531 | 59,601 | ||||||||
|
|
|
|
|||||||
Total debt (adjusted for joint venture partners share of debt) (B) |
$ | 1,086,023 | $ | 1,090,453 | ||||||
|
|
|
|
|||||||
Total debt as a % of undepreciated real estate assets (adjusted for joint venture partners share of debt) (B÷A) |
35.3 | % | 38.2 | % | ||||||
|
|
|
|
|||||||
Total debt per balance sheet |
$ | 1,036,492 | $ | 1,030,852 | ||||||
Plus: |
||||||||||
Company share of third party debt held in unconsolidated entities |
49,531 | 59,601 | ||||||||
Preferred shares at liquidation value |
43,392 | 43,392 | ||||||||
|
|
|
|
|||||||
Total debt and preferred equity (adjusted for joint venture partners share of debt) (C) |
$ | 1,129,415 | $ | 1,133,845 | ||||||
|
|
|
|
|||||||
Total debt and preferred equity as a % of undepreciated real estate assets (adjusted for joint venture partners share of debt) (C÷A) |
36.8 | % | 39.7 | % | ||||||
|
|
|
|
Supplemental Financial Data | 27 | Page |
Table 7 - Computation of Coverage Ratios
(In thousands)
Nine months ended | ||||||||||
September 30, | ||||||||||
2012 | 2011 | |||||||||
Net income (loss) |
$ | 65,357 | $ | 21,675 | ||||||
Other non-cash (income) expense, net |
2,920 | 3,141 | ||||||||
Income tax expense, net |
469 | 568 | ||||||||
Gains on sales of real estate assets, net |
(25,695 | ) | (8,757 | ) | ||||||
Gain on sale of real estate assets - unconsolidated entity, net |
(6,055 | ) | | |||||||
Net loss on early extinguishment of indebtedness |
301 | | ||||||||
Depreciation expense |
59,172 | 56,383 | ||||||||
Depreciation and amort. (company share) of assets held in unconsolidated entities |
972 | 1,084 | ||||||||
Interest expense |
34,564 | 43,119 | ||||||||
Interest expense (company share) of assets held in unconsolidated entities |
1,970 | 2,592 | ||||||||
Amortization of deferred financing costs |
2,026 | 2,085 | ||||||||
|
|
|
|
|||||||
Income available for debt service (A) |
$ | 136,001 | $ | 121,890 | ||||||
|
|
|
|
|||||||
Annualized income available for debt service (B) |
$ | 181,335 | $ | 162,520 | ||||||
|
|
|
|
|||||||
Interest expense |
$ | 34,564 | $ | 43,119 | ||||||
Interest expense (company share) of assets held in unconsolidated entities |
1,970 | 2,592 | ||||||||
|
|
|
|
|||||||
Adjusted interest expense (C) |
36,534 | 45,711 | ||||||||
Capitalized interest |
4,414 | 1,892 | ||||||||
|
|
|
|
|||||||
Adjusted interest expense (including capitalized interest) (D) |
$ | 40,948 | $ | 47,603 | ||||||
|
|
|
|
|||||||
Adjusted interest expense |
$ | 36,534 | $ | 45,711 | ||||||
Dividends to preferred shareholders |
2,766 | 3,533 | ||||||||
|
|
|
|
|||||||
Fixed charges (E) |
39,300 | 49,244 | ||||||||
Capitalized interest |
4,414 | 1,892 | ||||||||
|
|
|
|
|||||||
Fixed charges (including capitalized interest) (F) |
$ | 43,714 | $ | 51,136 | ||||||
|
|
|
|
|||||||
Total debt (adjusted for joint venture partners share of debt) (see Table 6) (G) |
$ | 1,086,023 | $ | 1,090,453 | ||||||
|
|
|
|
|||||||
Interest coverage ratio (A÷C) |
3.7x | 2.7x | ||||||||
|
|
|
|
|||||||
Interest coverage ratio (including capitalized interest) (A÷D) |
3.3x | 2.6x | ||||||||
|
|
|
|
|||||||
Fixed charge coverage ratio (A÷E) |
3.5x | 2.5x | ||||||||
|
|
|
|
|||||||
Fixed charge coverage ratio (including capitalized interest) (A÷F) |
3.1x | 2.4x | ||||||||
|
|
|
|
|||||||
Total debt to annualized income available for debt service ratio (G÷B) |
6.0x | 6.7x | ||||||||
|
|
|
|
Table 8 - Calculation of Company Undepreciated Book Value Per Share
(In thousands, except per share data)
September 30, 2012 | |||||
Total Company shareholders equity per balance sheet |
$ | 1,112,834 | |||
Plus: |
|||||
Accumulated depreciation, per balance sheet |
825,015 | ||||
Noncontrolling interest of common unitholders in Operating Partnership, per balance sheet |
6,874 | ||||
Less: |
|||||
Deferred financing costs, net, per balance sheet |
(9,376 | ) | |||
Preferred shares at liquidation value |
(43,392 | ) | |||
|
|
||||
Total undepreciated book value (A) |
$ | 1,891,955 | |||
|
|
||||
Total common shares and units (B) |
54,556 | ||||
|
|
||||
Company undepreciated book value per share (A÷B) |
$ | 34.68 | |||
|
|
Supplemental Financial Data | 28 | Page |
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end