-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IzKxETg3oCuILz5n03C0sXtRS+MxcvYJNaRGLffv1qBwxzvBj/ZiYyXWCQI9gbL+ y61elBLwR0AHAAvWodaFDg== 0000891092-04-005513.txt : 20041112 0000891092-04-005513.hdr.sgml : 20041111 20041112062013 ACCESSION NUMBER: 0000891092-04-005513 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20041110 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041112 DATE AS OF CHANGE: 20041112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMREIT CENTRAL INDEX KEY: 0000913957 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 760410050 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-31397 FILM NUMBER: 041134904 BUSINESS ADDRESS: STREET 1: 8 GREENWAY PLAZA STREET 2: STE 824 CITY: HOUSTON STATE: TX ZIP: 77046 BUSINESS PHONE: 7138501400 MAIL ADDRESS: STREET 1: 8 GREENWAY PLAZA STREET 2: STE 824 CITY: HOUSTON STATE: TX ZIP: 77046 FORMER COMPANY: FORMER CONFORMED NAME: AMREIT INC DATE OF NAME CHANGE: 19981123 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN ASSET ADVISERS TRUST INC DATE OF NAME CHANGE: 19931022 8-K 1 e19694_8k.txt FORM 8-K 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): November 10, 2004 AMREIT (Exact name of Registrant as specified in its Charter) Texas 0-28378 76-0410050 (State or other jurisdiction of (Commission file (I.R.S. Employer incorporation or organization) number) Identification Number) 8 Greenway Plaza, Suite 1000, Houston, Texas 77046 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (713) 850-1400 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: |_| 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 November 10, 2004 the Company issued a press release announcing its financial results for its third quarter ended September 30, 2004. A copy of the press release issued by the Company is attached hereto as Exhibit 99.1. Also attached as Exhibit 99.2 to this report are the slides which accompany this press release. The Company's press release announcing its financial results for its third quarter ended September 30, 2004 contains non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles, or GAAP. Pursuant to the requirements of Regulation G, the Company has provided quantitative reconciliations within the press release of the non-GAAP financial measures to the most directly comparable GAAP financial measures. The press release attached to this Form 8-K as Exhibit 99.1 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liabilities of that Section. Item 9.01. Financial Statements and Exhibits. (c) Exhibits. The following exhibits are furnished as part of this current Report on Form 8-K: 99.1 Press release dated November 10, 2004 99.2 Slide presentation 2 SIGNATURE 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. Date: November 10, 2004 AMREIT By: /s/ Chad C. Braun ---------------------------- Chad C. Braun Executive Vice President and Chief Financial Officer 3 INDEX TO EXHIBITS 99.1 Press release dated November 10, 2004 99.2 Slide presentation 4 EX-99.1 2 e19694ex99_1.txt PRESS RELEASE Exhibit 99.1 AmREIT Reports Third Quarter Results - Loss Per Share of $0.01; - FFO and Adjusted FFO of $0.18 Per Share, on Track with 2004 Guidance; and - Increase in Total Assets to $167 Million, up 64 Percent Compared to December 31, 2003. HOUSTON, Nov. 10 /PRNewswire-FirstCall/ -- AmREIT (Amex: AMY), a Houston- based real estate investment trust, announced its third quarter of 2004 results. Revenues for the third quarter increased 127 percent to $5.8 million compared to $2.5 million for the third quarter of 2003. This increase is due to additional portfolio revenue of $2.0 million (attributed to property acquisitions made in the second and third quarter of 2004), additional real estate operating and development revenue of $250,000 and additional securities and retail partnership revenue of $1.0 million, primarily due to an increase in securities commissions earned from the sale of class D common shares and the sale of limited partnership units, which was offset by an increase in securities commission expense of $766,000. Net income attributable to class A shareholders was a loss of $48,000 for the quarter compared to net income of $202,000 for the third quarter of last year. For the third quarter, AmREIT's income before discontinued operations per class A common share was a loss of $0.14 compared to a loss of $0.15 per share for the third quarter of 2003. The income from discontinued operations for the quarter was $0.13 per class A common share compared with income of $0.22 per share for the third quarter of 2003. The company's net earnings per share for the third quarter was a loss of $0.01 compared to net earnings per share of $0.07 for the same period last year. Diluted earnings per share information is not applicable due to the anti-dilutive nature of the common class B, C and D shares. Funds From Operations (FFO) for the third quarter was $603,000, or $0.18 per class A common share. This compares to FFO of $417,000, or $0.15 per share, for the same period last year. Because there were no non-operational, non-cash charges to earnings during the third quarter (such as the deferred merger costs), Adjusted FFO and FFO are the same. For the nine-months ended September 30, 2004, FFO was a loss of $1.1 million. The Company added back the $1.7 million non-cash deferred merger charge to earnings and the $1.1 million non-cash charge to earnings resulting from an asset impairment and the corresponding write-down of value, resulting in Adjusted FFO of $1.7 million or $0.54 per class A common share, which is in line with management's guidance range for annual adjusted FFO of $0.61 to $0.65 per share. A reconciliation of net income to FFO is included in the financial tables accompanying this press release. Total assets increased 64 percent to $167 million from $101 million at December 31, 2003. Total liabilities increased to $88.8 million during the third quarter, up from $51.7 million at year-end. "We set forth specific, growth oriented goals as we entered 2004. With the results of this quarter, we are well on our way to achieving those goals. Our team of high-quality individuals contributed significantly to this success," said Chad Braun, AmREIT's executive vice president and chief financial officer. "As we execute our business plan, we will continue to focus on three key objectives: remaining focused on our investment discipline of acquiring what we believe to be irreplaceable corners, building and expanding our flexible business model, and building and growing a great team of talented individuals." Operational Highlights - On July 1, 2004, AmREIT acquired Plaza in the Park, a 129,955 square- foot Kroger anchored shopping center located on approximately 14.3 acres. The property is located at the southwest corner of Buffalo Speedway and Westpark in Houston, Texas. Plaza in the Park's Kroger is undergoing a 13,120 square-foot expansion, and when completed, Kroger has indicated that they expect it to be the number one Kroger grocery store in both sales volume and size within the state. The property was acquired for cash and the assumption of long term fixed rate debt. The shopping center is 96.7 percent occupied. - On July 1, 2004, AmREIT acquired Cinco Ranch -- Kroger, a 97,297 square- foot Kroger anchored shopping center located on approximately 12.8 acres of land. The property is located at the northeast corner of Mason Road and Westheimer Parkway in Katy, Texas, a suburb of Houston. The shopping center is positioned in the heart of the Cinco Ranch master planned community, and was named one of the top ten Kroger grocery stores in Texas. The property was acquired for cash and the assumption of long term fixed-rate debt. The shopping center is 100 percent occupied. - On July 23, 2004, AmREIT acquired Bakery Square, a 34,704 square foot retail shopping center shopping center anchored by Bank of America and a free standing Walgreen's pharmacy. The property is located at the southwest corner of Dunlavy and West Gray in Houston, Texas. This is an infill (established areas with significant barriers to entry) property located just west of downtown Houston and includes other national tenants such as T-Mobile, Blockbuster Video and Boston Market. The property was acquired for cash and the assumption of long-term debt. The shopping center is 100 percent occupied. - During the quarter, AmREIT commenced its $170 million class D common share offering and raised approximately $5.5 million in gross sales proceeds. The security has a stated yield of 6.5 percent per annum, and after a seven-year holding period, has a conversion option into the company's publicly traded class A common shares at a 7.7 percent premium on invested capital. Outlook for 2004 In their annual report, AmREIT set forth four key goals and expectations for this year: - The first goal was to have asset growth of 100 percent over the next 12 to 18 months. With the acquisitions made during the third quarter assets increased by approximately 64 percent. The real estate pipeline remains robust, and AmREIT remains on track to achieve 100 percent growth between December 2004 and June 2005. Additionally, for almost 20 years AmREIT has invested in both single and multi-tenant real estate located in high-traffic, highly populated areas. Since listing on the AMEX two years ago, a strategy was implemented to expand holdings of multi-tenant properties and today, a majority of rental revenue is generated from multi-tenant shopping centers. As this strategy is executed, the company will continue to evaluate and dispose of those assets that are no longer core assets, replacing them with multi-tenant shopping centers, grocery anchored centers and single tenant leases on what are believed to be irreplaceable corners. As of September 30, 2004, the company's Net Asset Value per share was approximately $8.60 to $9.25. When compared to the September 30, 2004 trading price, this translates into a 13 to 21 percent discount to Net Asset Value. - The second goal was continued growth in capital resources and maintaining a conservative leverage structure. Through September 30, 2004, the company raised approximately $32.2 million through its class C and D common share offerings. Through its by-laws, the company's debt- to-total asset ratio is limited to 55 percent, and as of September 30, 2004, the company's debt to-total asset ratio was approximately 53 percent. - The third goal was continued diversity and increased portfolio quality. With the multi-tenant acquisitions made during the third quarter, the company has continued to reduce tenant concentration and increase the dependability of rental income. As of September 30, 2004, no single tenant represented more than 10 percent of total revenue. - And the fourth goal was continued growth in Adjusted FFO (AFFO) and dividends. Supported by the increase in rental revenue generated by the acquisitions made during the quarter, as well as the increase in fees and profits generated from supporting business segments, the annual target AFFO guidance remains $0.61 to $0.65 per class A share. Dividends have increased every quarter since listing on the AMEX. With the dividends declared for the fourth quarter of 2004, annual dividends for the year have increased approximately 9.1 percent over 2003, which is in line with management's estimate of 7 to 10 percent. AmREIT updates earnings guidance on a quarterly basis. Conference Call AmREIT will hold its quarterly conference call to discuss third quarter results Wednesday, November 10, at 2:00 pm Central Time (3:00 pm Eastern Time). The dial-in number for the call is 800.510.0146, passcode AmREIT. A live Web cast of the call can be accessed on the investor relations page of AmREIT's Web site at http://www.amreit.com. The call will also be available for replay for 30 days by dialing 888-286-8010, passcode 84509133, or by going to the investor relations events page of the company's Web site. About AmREIT AmREIT, a self-managed real estate investment firm, has been acquiring, developing, and managing high quality commercial retail real estate to generate monthly income and growth opportunities for investors for more than 19 years. A steadily growing publicly traded company, AmREIT is known for its ownership of "irreplaceable corners" - premier retail frontage properties in high-traffic, highly populated areas. These corners attract large grocery anchored centers, high-end multi-tenant shopping centers and, high profile single tenant properties, leased to trusted names such as Kroger, Starbucks, Walgreen's, and Washington Mutual. AmREIT also creates retail limited partnerships, offered to accredited investors through the financial planning community. These retail partnerships add value through actively acquiring and developing high quality free standing and shopping center properties to create the potential for increasing income and capital appreciation by selling the properties within a defined time horizon. In addition to historical information, this press release contains forward-looking statements under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which AmREIT operates, management's beliefs and assumptions made by management. Past performance is not indicative of future returns. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. This press release does not constitute an offer to sell, or the solicitation of an offer to buy any public or private securities from the Company. The purchase of any securities may only be made pursuant to a prospectus. A copy of any available prospectus and the related subscription documents are available to qualified potential investors on request. For more information, call Debbie Lucas, Vice President Investor Relations and Corporate Communications of AmREIT, at (713) 850-1400, or Chad Braun, Chief Financial Officer of AmREIT, 713-850-1400. AmREIT is online at http://www.amreit.com. Operating Results (in thousands, except share and per share data) (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, Revenues: 2004 2003 2004 2003 Rental income from operatingleases $2,980 $1,024 $6,176 $2,964 Earned income from direct financing leases 507 507 1,522 1,508 Real estate fee income 415 165 1,364 432 Securities commission income 1,780 785 5,333 1,312 Asset management fee income 97 72 245 170 Interest and other income 18 2 343 5 Total Revenues 5,797 2,555 14,983 6,391 Expenses: General operating and administrative 2,062 864 5,070 2,400 Legal and professional 312 239 961 575 Securities commissions 1,388 622 4,149 1,018 Depreciation and amortization 749 194 1,253 550 Deferred merger costs -- -- 1,682 -- Total Expenses 4,511 1,919 13,115 4,543 Operating Income 1,286 636 1,868 1,848 Income from non-consolidated affiliates 54 7 240 92 Federal income tax benefit (expense) 427 (15) 152 -- Interest expense (1,026) (532) (2,189) (1,588) Minority interest in income of consolidated joint venture (46) (46) (139) (129) Income (loss) before discontinued operations 695 50 (68) 223 Income from discontinued operations 425 609 921 1,543 Net income 1,120 659 853 1,766 Distributions paid to class B, C and D shareholders (1,168) (457) (3,087) (1,349) Net income (loss) available to class A shareholders $(48) $202 $(2,234) $417 (in thousands, except share and per share data) (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2004 2003 2004 2003 Reconciliation of Net Income (loss) to Funds From Operations ("FFO"): Income before discontinued operations $695 $50 $(68) $223 Income from discontinued operations 425 609 921 1,543 Depreciation - from operations 736 192 1,224 544 Depreciation - from discontinued operations -- 23 38 99 Gain on sale of real estate held for investment (85) -- (85) -- Class B, C and D distributions (1,168) (457) (3,087) (1,349) FFO available to class A shares 603 $417 $(1,057) $1,060 Basic and Diluted Per Class A Share Data: (Loss) before discontinued operations $(0.14) $(0.15) $(0.99) $(0.40) Income (loss) from discontinued operations $0.13 $0.22 $0.29 $0.55 Net income (loss) $(0.01) $0.07 $(0.70) $0.15 FFO $0.18 $0.15 $(0.33) $0.38 Distributions per class A share $0.12 $0.11 $0.36 $0.33 Distributions per class B, C and D share $0.52 $0.18 $1.24 $0.58 Weighted average class A common shares used to compute net income per share, basic and diluted 3,381,899 2,805,753 3,190,810 2,788,303 Weighted average number of class B common shares outstanding 1,558,293 2,399,128 2,076,246 2,316,067 Weighted average number of class C common shares outstanding 4,050,916 64,580 3,326,696 21,763 Weighted average number of class D common shares outstanding 174,180 -- 58,484 -- Balance Sheet Highlights (in thousands) (Unaudited) September 30, December 31, 2004 2003 Real estate held for investment, net $121,426 $68,018 Net investment in direct financing leases 19,221 22,046 Real estate held for resale, net 9,684 4,384 Total assets 166,657 101,327 Notes payable 84,905 48,485 Total liabilities 88,818 51,684 Minority interest 1,070 847 Total shareholders' equity 76,769 48,796 Non-GAAP Financial Disclosure This press release contains certain non-GAAP financial measures that management believes are useful in evaluating an equity REIT's performance. AmREIT's definitions and calculations of non-GAAP financial measures may differ from those used by other equity REIT's, and therefore may not be comparable. The non-GAAP financial measures should not be considered as an alternative to net income as an indication of our operating results, or to net cash provided by operating activities as a measure of our liquidity. AmREIT considers FFO to be an appropriate measure of the operating performance of an equity REIT. The National Association of Real Estate Investment Trusts ("NAREIT") defines FFO as net income computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains or losses from sales of property, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. AmREIT calculates its base FFO in accordance with this definition. AmREIT adjusts its FFO calculation by adding back non-cash charges to earnings, such as the issuance of stock in conjunction with the payment of deferred merger costs and impairment charges on real assets, resulting in its adjusted FFO. The Company considers FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions and excluding depreciation, FFO is a helpful tool that can assist in the comparison of the operating performance of a company's real estate between periods, or as compared to different companies. FFO is not defined by GAAP and should not be considered as an alternative to net income as an indication of our operating performance or to net cash provided by operating activities as a measure of our liquidity. FFO and adjusted FFO as disclosed by other REITs may not be comparable to AmREIT's calculation. Projected FFO is calculated in a method consistent with historical FFO, and AmREIT considers projected FFO to be an appropriate supplemental measure when compared with projected EPS. A reconciliation of the projected FFO to projected EPS per share is provided below: Projected 2004 Range Historical High Low 12/31/03 Net income (loss) available to class A shareholders ($0.92) ($0.96) $0.02 Depreciation and amortization 0.60 0.60 0.30 Less gain (loss) on sale of real estate 0.03 0.03 (0.11) FFO available to class A shareholders (0.29) (0.33) 0.21 Impairment charges 0.34 0.34 -- Deferred merger costs 0.60 0.60 0.33 Adjusted FFO $0.65 $0.61 $0.54 FOR INFORMATION CONTACT: Debbie Lucas (dlucas@amreit.com) AmREIT, 713-860-4943 SOURCE AmREIT -0- 11/10/2004 /CONTACT: Debbie Lucas, +1-713-860-4943, dlucas@amreit.com, of AmREIT/ /Web site: http://www.amreit.com / (AMY) CO: AmREIT ST: Texas IN: RLT SU: CCA ERN EX-99.2 3 e19694ex99_2.txt PRESENTATION Exhibit 99.2 [LOGO] AmREIT - ------------------------------------------- Good Things Happen on Great Real Estate(TM) - ------------------------------------------- [GRAPHIC OMITTED] 3Q Acquisition Plaza in the Park - Kroger ================================================================================ [GRAPHIC OMITTED] Property Information: => SW Corner of Buffalo Speedway & Westpark in Houston, TX => Acquired 7/1/04 => 131,000 sq. feet Kroger is the #1 grocer in the Houston marketplace ================================================================================ 2 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT [GRAPHIC OMITTED] 3Q Acquisition Cinco Ranch - Kroger ================================================================================ [GRAPHIC OMITTED] Property Information: => NE corner of Mason Road and Westheimer in Katy, TX => Acquired 7/1/04 => 97,297 sq. feet Kroger is the #1 grocer in the Houston marketplace ================================================================================ 3 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT [GRAPHIC OMITTED] 3Q Acquisition Bakery Square ================================================================================ [GRAPHIC OMITTED] Property Information: o SW corner of Dunlavy and West Gray in Houston, TX o Acquired 7/23/04 o 34,704 total sq. feet This is a strong infill property located just west of downtown Houston. ================================================================================ 4 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT [GRAPHIC OMITTED] Our Business Model ================================================================================ Wall Street ||$|| Capital -------| | |------> AmREIT <------| | ^ | o Advisory Fees Retail | Real Estate o Construction Fees o Profit Partnership | Operating and o Development Fees Participation Business | Development o Property Management Fees ^ | Business o Asset Gains | | o Brokerage and Leasing |(Capital) |(Capital) Fees | | ----- Securities Business <---- Independent Financial Planning Community (Relationships) ================================================================================ => AmREIT (AMY) is supported by three synergistic businesses: a real estate operating and development business, a NASD registered securities business and a retail partnership business ================================================================================ 5 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT [GRAPHIC OMITTED] Asset Growth (millions) ================================================================================ [The following information was depicted as a bar chart in the printed material] 2002 2003 2004E 2005E ---- ---- ----- ----- $74 $101 $200 $400 *12-18 months * Represents the adjusted FFO (AFFO) per share. The company adheres to the NAREIT definition of FFO. The company's AFFO takes the NAREIT calculated FFO and adds back certain non-cash expense items, if any for that year. ================================================================================ 6 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT [GRAPHIC OMITTED] AMY vs. NAV ================================================================================ * In the 3Q Earnings Release AmREIT stated that NAV/share should be in the range of $8.50 to $9.30 for the 3Q04 period. The range displayed is not representative of the previous NAV estimates prior to the 2Q04 earnings release. AmREIT updates NAV/share on a quarterly basis. [The following information was depicted as a mountain chart in the printed material] Value of Advisor $9.30 NAV NAV Discount $8.50 Range* $7.80 Close 11/8/04 Date Close ---- ----- Oct-04 8.00 Sep-04 7.46 Aug-04 8.04 Jul-04 7.47 Jun-04 6.63 May-04 6.64 Apr-04 6.75 Mar-04 7.07 Feb-04 7.05 Jan-04 6.60 Dec-03 6.40 Nov-03 6.40 Oct-03 6.50 Sep-03 6.40 Aug-03 6.38 Jul-03 6.32 Jun-03 6.15 May-03 6.64 Apr-03 6.55 Mar-03 6.80 Feb-03 6.30 Jan-03 6.25 Dec-02 6.25 Nov-02 6.50 Oct-02 6.50 Sep-02 6.55 Aug-02 6.95 Jul-02 6.60 ================================================================================ 7 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT [GRAPHIC OMITTED] FFO Growth (Adjusted) (Per Share) ================================================================================ [The following information was depicted as a bar chart in the printed material] 2002 2003 2004E ---- ---- ----- Increase 15-19% $0.42 $0.54 $0.62 * Represents the adjusted FFO (AFFO) per share. The company adheres to the NAREIT definition of FFO. The company's AFFO takes the NAREIT calculated FFO and adds back certain non-cash expense items, if any for that year. ================================================================================ 8 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT [GRAPHIC OMITTED] Dividend Growth (per share) ================================================================================ [The following information was depicted as a bar chart in the printed material] 2002 2003 2004 ---- ---- ---- Increase 9.1% $0.34 $0.45 $0.48 * Represents the adjusted FFO (AFFO) per share. The company adheres to the NAREIT definition of FFO. The company's AFFO takes the NAREIT calculated FFO and adds back certain non-cash expense items, if any for that year. ================================================================================ 9 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT => Contact Us www.amreit.com 1.800.888.4400 Kerr Taylor ----------- CEO ktaylor@amreit.com Extension 114 Chad Braun ---------- CFO cbraun@amreit.com Extension 124 Debbie Lucas ------------ VP Corporate Communications dlucas@amreit.com Extension 143 [GRAPHIC OMITTED] Disclaimer ================================================================================ Statements included in this presentation that state the company's or management's intentions, hopes, beliefs, expectations or predictions of the future are "forward-looking" statements, within the meaning of the Private Securities Litigation Reform Act of 1995, which, by their nature, involve known and unknown risks and uncertainties. The company's actual results, performance or achievements could differ materially from those expressed or implied by such statements. Reference is made to the company's regulatory filings with the Securities and Exchange Commission for information or factors which may impact the company's performance. ================================================================================ 11 Good Things Happen on Great Real Estate(TM) [LOGO] AmREIT -----END PRIVACY-ENHANCED MESSAGE-----