0001005150-01-500798.txt : 20011128 0001005150-01-500798.hdr.sgml : 20011128 ACCESSION NUMBER: 0001005150-01-500798 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20011107 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: FILED AS OF DATE: 20011107 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RECKSON OPERATING PARTNERSHIP LP CENTRAL INDEX KEY: 0000930810 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 113233647 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 033-84580 FILM NUMBER: 1776839 BUSINESS ADDRESS: STREET 1: 225 BROADHOLLOW RD CITY: MELVILLE STATE: NY ZIP: 11747 BUSINESS PHONE: 6316946900 MAIL ADDRESS: STREET 1: 225 BROADHOLLOW RD CITY: MELVILLE STATE: NY ZIP: 11747 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RECKSON ASSOCIATES REALTY CORP CENTRAL INDEX KEY: 0000930548 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 113233650 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13762 FILM NUMBER: 1776840 BUSINESS ADDRESS: STREET 1: 225 BROADHOLLOW RD CITY: MELVILLE STATE: NY ZIP: 11747 BUSINESS PHONE: 6316946900 MAIL ADDRESS: STREET 1: 225 BROADHOLLOW RD CITY: MELVILLE STATE: NY ZIP: 11747 8-K 1 form8-k.txt FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT ------------- Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: November 7, 2001 RECKSON ASSOCIATES REALTY CORP. and RECKSON OPERATING PARTNERSHIP, L.P. (Exact name of each Registrant as specified in its Charter) Reckson Associates Realty Corp. - Maryland Reckson Associates Realty Corp. - Reckson Operating Partnership, L.P. - Delaware 11-3233650 (State or other jurisdiction of incorporation or organization) Reckson Operating Partnership, L.P. - 11-3233647 (IRS Employer ID Number) 225 Broadhollow Road 11747 Melville, New York (Zip Code) (Address of principal executive offices)
1-13762 (Commission File Number) (631) 694-6900 (Registrant's telephone number, including area code) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits 99.1 Supplemental Operating and Financial Data for the Quarter Ended September 30, 2001 ITEM 9. REGULATION FD DISCLOSURE For the quarter ended September 30, 2001, Registrants intend to make available supplemental data regarding their operations that is too voluminous for a press release. Registrants are attaching the supplemental data as Exhibit 99.1 to this Current Report on Form 8-K. Note: the information in this report (including the exhibit) is furnished pursuant to Item 9 and shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. This report will not be deemed an admission as to the materiality of any information in the report that is required to be disclosed solely by Regulation FD. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. RECKSON ASSOCIATES REALTY CORP. By: /s/ Michael Maturo ------------------------------------------ Michael Maturo Executive Vice President and Chief Financial Officer RECKSON OPERATING PARTNERSHIP, L.P. By: Reckson Associates Realty Corp., its General Partner By: /s/ Michael Maturo ------------------------------------------ Michael Maturo Executive Vice President and Chief Financial Officer Date: November 7, 2001 EX-99.1 3 ex99-1.txt EXHIBIT 99.1 RECKSON ASSOCIATES REALTY CORP. THIRD QUARTER 2001 SUPPLEMENTAL OPERATING AND FINANCIAL DATA NOVEMBER 7, 2001 [PICTURE OMITTED] 225 BROADHOLLOW ROAD, MELVILLE, NY 11747 PHONE: 631.694.6900 1.888.RECKSON FAX: 631.622.6790 WWW.RECKSON.COM -------------------------------------------------------------------------------- TABLE OF CONTENTS
Page(s) ------- Company Information o Corporate Information..........................................................................................1-2 o Reporting Period Highlights......................................................................................3 o Stock Performance................................................................................................4 Financial Highlights o Key Financial Data...............................................................................................5 o Statements of Operations.........................................................................................6 o Funds from Operations and Cash Available for Distribution......................................................7-8 o Consolidated Balance Sheets......................................................................................9 o Debt Summary....................................................................................................10 o Preferred Securities............................................................................................11 Portfolio Performance o Same Store Performance.......................................................................................12-13 o Portfolio Snapshot..............................................................................................14 o Occupancy Analysis...........................................................................................15-16 o Leasing Statistics...........................................................................................17-18 o Lease Expiration Schedule....................................................................................19-23 o Lease Distribution..............................................................................................24 o Capital Expenditures Analysis...................................................................................25 Market Statistics o Suburban Market Overviews.......................................................................................26 o New York City Sub-Markets....................................................................................27-28 o Long Island Sub-Markets.........................................................................................29 o Westchester Sub-Markets.........................................................................................30 o New Jersey Sub-Markets..........................................................................................31 Value Creation Pipeline o Value Creation Pipeline Schedule................................................................................32
Certain matters discussed herein are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, forward-looking statements are not guarantees of results and no assurance can be given that the expected results will be delivered. Such forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those expected. Among those risks, trends and uncertainties are the general economic climate, including the conditions affecting industries in which our principal tenants compete; changes in the supply of and demand for office and industrial properties in the New York Tri-State area; changes in interest rate levels; downturns in rental rate levels in our markets and our ability to lease or re-lease space in a timely manner at current or anticipated rental rate levels; the availability of financing to us or our tenants; changes in operating costs, including utility costs; repayment of debt owed to the Company by third parties (including FrontLine Capital Group); risks associated with joint ventures; and other risks associated with the development and acquisition of properties, including risks that development may not be completed on schedule, that the tenants will not take occupancy or pay rent, or that development or operating costs may be greater than anticipated. For further information on factors that could impact Reckson, reference is made to Reckson's filings with the Securities and Exchange Commission. Reckson is subject to the reporting requirements of the Securities and Exchange Commission and undertakes no responsibility to update or supplement information contained in this supplemental package that subsequently becomes untrue. ### -------------------------------------------------------------------------------- CORPORATE INFORMATION CORPORATE PROFILE Reckson Associates Realty Corp. is a self-administered and self-managed real estate investment trust (REIT) that is one of the largest publicly traded owners, developers and managers of Class A office and industrial properties in the New York Tri-State area. Through a predecessor entity, Reckson commenced operations in 1958 and grew steadily by acquiring, developing and redeveloping Class A office and industrial properties throughout Long Island. In June 1995, Reckson successfully completed its initial public offering. Subsequently, the Company expanded from its Long Island base and established operating divisions in Westchester, Connecticut, New Jersey and New York City. By transporting the formula that built its success on Long Island to the other Tri-State area markets, Reckson is now positioned as the premier real estate franchise in the New York Tri-State area. Today, Reckson owns 182 properties comprised of approximately 20.6 million square feet located throughout the New York Tri-State area markets. These properties are comprised of 13.8 million square feet of office space and 6.8 million square feet of industrial space. The Company has a total market capitalization in excess of $3.4 billion and has generated a total return to its initial Class A common shareholders of approximately 195% for the period June 2, 1995 through September 30, 2001. Reckson is a fully integrated real estate operating company specializing in the acquisition, leasing, financing, property and asset management, design and development and construction of Class A office and industrial properties in the New York Tri-State area. CORPORATE HEADQUARTERS 225 Broadhollow Road Melville, New York 11747-4883 Telephone: (631) 694-6900 (888) RECKSON Facsimile: (631) 622-6790 Web site: www.reckson.com --------------- EXECUTIVE OFFICER CONTACTS Donald Rechler Co-Chief Executive Officer Chairman of the Board Scott Rechler Co-Chief Executive Officer Michael Maturo Chief Financial Officer Executive Vice President INVESTOR RELATIONS Susan McGuire Vice President Investor Relations Telephone: (631) 622-6642 Facsimile: (631) 622-6790 E-mail: smcguire@reckson.com -------------------- To request an Investor Relations package or be added to our distribution list, please contact us at: Telephone: (631) 622-6746 Facsimile: (631) 622-6790 E-mail: investorrelations@reckson.com ----------------------------- Web site: www.reckson.com (Go to Information Request in the Investor Relations section) 1 -------------------------------------------------------------------------------- CORPORATE INFORMATION RESEARCH COVERAGE CIBC World Markets Legg Mason Anthony Paolone David Fick/Ken Weinberg (212) 667-8116 (410) 454-5018/(410) 454-5175 Credit Suisse First Boston Lehman Brothers Lawrence Raiman David Shulman/Stuart Axelrod (212) 538-2380 (646) 351-4260/(646) 351-4261 Deutsche Banc Alex. Brown McDonald & Company Louis Taylor Anatole Pevnev (212) 469-4912 (216) 263-4783 Goldman Sachs Merrill Lynch David Kostin/James Kammert Steve Sakwa/Rahul Bhattacharjee (212) 902-6781/(212) 855-0670 (212) 670-2158/(212) 449-1920 Greenstreet Advisors Salomon Smith Barney John Lutzius Jonathan Litt/Gary Boston (949) 640-8780 (212) 816-0231/(212) 816-1383 QUARTERLY REPORTING SCHEDULE Quarterly results will be announced according to the following anticipated schedule: First Quarter Early May Second Quarter Early August Third Quarter Early November Fourth Quarter and Year-End Late February SENIOR UNSECURED DEBT RATINGS Moody's Baa3 Standard & Poor's BBB- STOCK LISTING The stock of Reckson Associates Realty Corp. is traded primarily on the New York Stock Exchange under the following symbols: Class A Common Stock: RA Class B Common Stock: RA.B Series A Preferred Stock: RA.A 2 -------------------------------------------------------------------------------- REPORTING PERIOD HIGHLIGHTS o Reported diluted FFO of $.66 per share for the third quarter of 2001, as compared to $.65 per share for the comparable 2000 period, representing a per share increase of 1.5%. Adjusting prior year FFO per share to exclude interest income relating to the FrontLine Capital Group loans, FFO attributable to core operations was $.59 per share, representing a per share increase of 11.9%. o Reported diluted FFO of $2.04 per share for the nine months ended September 30, 2001, as compared to $1.92 per share for the comparable 2000 period, representing a per share increase of 6.3%. Adjusting prior year FFO per share to exclude interest income relating to the FrontLine Capital Group loans, FFO attributable to core operations was $1.75 per share, representing a per share increase of 16.6%. o Generated same property NOI increases of 10.5% (cash) and 5.2% (GAAP) for the third quarter of 2001. o Generated same space rent growth of 21.7% (GAAP) and 15.4% (cash) for Office and 18.3% (GAAP) and 2.0% (cash) for Industrial/R&D for the third quarter of 2001. o Sold convertible preferred securities in Keystone Property Trust for $35.7 million. o Completed dispositions of three non-core office assets totaling approximately $53 million, bringing the aggregate proceeds from property dispositions in the capital recycling program to approximately $85 million. o Expect to close on the sale of a 49% interest in 919 Third Avenue to New York State Teachers' Retirement System (NYSTRS) within 30 days. o Converted Crescent's $85 million preferred equity investment in Metropolitan into approximately 3.5 million shares of Reckson Class A common stock, which were then successfully placed with major institutional holders. o Established a valuation reserve of $163 million against the investment in the FrontLine loans and joint ventures with RSVP. 3 -------------------------------------------------------------------------------- STOCK PERFORMANCE The following summarizes recent activity of Reckson's Class A common stock (RA):
2nd Quarter 3rd Quarter 10/01/01 to 2001 2001 10/31/2001 ----------------------------------------------- High Price* $ 23.90 $ 24.15 $ 24.46 Low Price* $ 21.14 $ 21.90 $ 22.79 Closing Price* $ 23.00 $ 24.15 $ 23.00 Average daily trading volume* 265,162 356,224 361,091 Indicated dividend per share** $ 1.6984 $ 1.6984 $ 1.6984 Closing dividend yield 7.38% 7.03% 7.38% Closing shares and units outstanding (thousands) 57,264 57,445 57,515 Closing market value of shares and units outstanding (thousands) $1,317,072 $1,387,297 $1,322,845 --------------------------------------------------------------------------------------------------------------------------
The following summarizes recent activity of Reckson's Class B common stock (RA.B):
2nd Quarter 3rd Quarter 10/01/01 to 2001 2001 10/31/2001 ----------------------------------------------- High Price* $ 25.00 $ 25.60 $ 25.76 Low Price* $ 22.40 $ 23.29 $ 23.95 Closing Price* $ 24.61 $ 25.51 $ 24.13 Average daily trading volume* 74,622 65,825 73,048 Indicated dividend per share** $ 2.5968 $ 2.5968 $ 2.5968 Closing dividend yield 10.55% 10.18% 10.76% Closing shares outstanding (thousands) 10,284 10,284 10,284 Closing market value of shares outstanding (thousands) $253,089 $262,345 $248,153 --------------------------------------------------------------------------------------------------------------------------
The following summarizes recent activity of Reckson's Series A preferred stock (RA.A):
2nd Quarter 3rd Quarter 10/01/01 to 2001 2001 10/31/2001 ----------------------------------------------- High Price* $ 23.15 $ 23.10 $ 23.29 Low Price* $ 20.80 $ 21.95 $ 22.60 Closing Price* $ 23.15 $ 23.00 $ 22.60 Average daily trading volume* 37,638 41,439 47,270 Indicated dividend per share** $ 1.9064 $ 1.9064 $ 1.9064 Closing dividend yield 8.23% 8.29% 8.44% Closing shares outstanding (thousands) 9,192 9,192 9,192 Closing market value of shares outstanding (thousands) $212,795 $211,416 $207,739 --------------------------------------------------------------------------------------------------------------------------
* New York Stock Exchange trades only ** On an annual basis 4 -------------------------------------------------------------------------------- KEY FINANCIAL DATA (Dollars in thousands, except per share data)
FOR THE THREE MONTHS ENDED OR AS OF ------------------------------------------------------------------------- 9/30/01 6/30/01 3/31/01 12/31/00 9/30/00 ------------------------------------------------------------------------- SHARES AND UNITS ---------------- Common Shares Outstanding - Class A 49,806,885 49,619,419 45,812,864 45,352,286 45,290,722 Common Shares Outstanding - Class B 10,283,513 10,283,513 10,283,513 10,283,513 10,283,513 Operating Partnership Units Outstanding 7,638,043 7,644,135 7,692,142 7,694,642 7,695,142 ------------------------------------------------------------------------- Total Shares and Operating Partnership Units 67,728,441 67,547,067 63,788,519 63,330,441 63,269,377 ======================================================================== SHARE PRICE & DIVIDENDS - CLASS A --------------------------------- End of period $ 24.15 $ 23.00 $ 22.30 $ 25.06 $ 25.50 High during period $ 24.15 $ 23.90 $ 25.88 $ 26.00 $ 26.81 Low during period $ 21.90 $ 21.14 $ 21.90 $ 21.88 $ 23.63 Dividend declared $ 0.42 $ 0.42 $ 0.39 $ 0.39 $ 0.39 Closing dividend yield 7.0% 7.4% 6.9% 6.2% 6.1% SHARE PRICE & DIVIDENDS - CLASS B --------------------------------- End of period $ 25.51 $ 24.61 $ 23.55 $ 27.19 $ 26.75 High during period $ 25.60 $ 25.00 $ 27.50 $ 27.56 $ 27.56 Low during period $ 23.29 $ 22.40 $ 22.90 $ 22.50 $ 24.63 Dividend declared $ 0.65 $ 0.65 $ 0.60 $ 0.60 $ 0.60 Closing dividend yield 10.2% 10.6% 10.2% 8.8% 9.0% MARKET CAPITALIZATION --------------------- Market Value of Common Equity (a) $ 1,649,627 $ 1,570,139 $ 1,435,338 $ 1,609,072 $ 1,626,224 Stated Value of Preferred Equity 310,765 314,533 407,318 407,318 407,318 Total Debt (b) 1,444,473 1,500,081 1,466,965 1,380,814 1,328,629 ------------------------------------------------------------------------- Total Market Capitalization $ 3,404,865 $ 3,384,753 $ 3,309,621 $ 3,397,204 $ 3,362,171 ======================================================================== Total Debt / Total Market Capitalization 42.4% 44.3% 44.3% 40.6% 39.5% SELECTED BALANCE SHEET DATA --------------------------- Book Value of Real Estate Assets before Depreciation $ 2,814,024 $ 2,860,491 $ 2,811,894 $ 2,770,607 $ 2,434,633 Total Assets $ 2,861,651 $ 3,112,242 $ 3,063,644 $ 2,998,030 $ 2,944,120 Total Liabilities $ 1,566,012 $ 1,639,095 $ 1,584,621 $ 1,519,150 $ 1,456,717 SELECTED OPERATING DATA ----------------------- Property Operating Revenues $ 126,722 $ 125,349 $ 123,439 $ 119,994 $ 115,754 Property Operating Expenses $ 44,231 $ 40,874 $ 40,994 $ 41,270 $ 41,255 Property Operating NOI $ 82,491 $ 84,475 $ 82,445 $ 78,724 $ 74,499 Property Gross Operating Margin 65.1% 67.4% 66.8% 65.6% 64.4% Other Revenues (excluding gain on sales of real estate) $ 5,333 $ 7,038 $ 7,447 $ 9,728 $ 9,342 Marketing, General & Administrative Expenses $ 7,679 $ 8,411 $ 7,497 $ 7,626 $ 6,930 as a percent of Total Revenues 5.8% 6.4% 5.7% 5.9% 5.5% (excluding gain on sales of real estate) Interest Expense $ 23,510 $ 23,562 $ 23,631 $ 23,670 $ 24,651 Capitalized Interest $ 2,627 $ 2,884 $ 2,703 $ 3,015 $ 3,274 Non-Incremental Capital Expenditures to NOI as a percent 6.18% 6.78% 3.98% 4.09% 7.13% FINANCIAL RATIOS ---------------- Debt Service Coverage Ratio 3.27 3.35 3.29 3.22 3.06 Fixed Charge Coverage Ratio 2.60 2.67 2.60 2.55 2.45 EPS, FFO AND CAD ---------------- Class A Common Stock Basic Income from Operations per share (d) $ 0.29 $ 0.32 $ 0.34 $ 0.33 $ 0.29 Diluted Income from Operations per share (d) $ 0.28 $ 0.32 $ 0.33 $ 0.32 $ 0.29 Basic Net Income (loss) per share $ (1.97) $ 0.32 $ 0.34 $ 0.28 $ 0.49 Diluted Net Income (loss) per share $ (1.97) $ 0.32 $ 0.33 $ 0.28 $ 0.48 Class B Common Stock Basic Income from Operations per share $ 0.44 $ 0.45 $ 0.52 $ 0.51 $ 0.45 Diluted Income from Operations per share $ 0.31 $ 0.34 $ 0.37 $ 0.36 $ 0.32 Basic Net Income (loss) per share $ (3.01) $ 0.45 $ 0.52 $ 0.44 $ 0.76 Diluted Net Income (loss) per share $ (3.01) $ 0.34 $ 0.37 $ 0.31 $ 0.53 Diluted FFO per Share $ 0.66 $ 0.70 $ 0.69 $ 0.67 $ 0.65 Diluted FFO payout ratio 68.7% 64.9% 60.2% 62.1% 63.7% Diluted CAD per Share $ 0.46 $ 0.48 $ 0.50 $ 0.43 $ 0.41 Diluted CAD payout ratio 99.3% 95.4% 84.0% 97.0% 103.2% TRI-STATE PORTFOLIO STATISTICS ------------------------------ Office Properties 78 82 82 82 81 Office Square Footage 13,863,565 14,438,850 14,444,838 14,437,238 14,163,377 Office Occupancy at end of Quarter (c) 96.7% 97.0% 97.1% 97.2% 97.0% Industrial Properties 103 104 104 104 103 Industrial Square Footage 6,812,158 6,836,803 6,834,113 6,834,113 6,628,113 Industrial Occupancy at end of Quarter (c) 97.5% 97.9% 97.8% 97.5% 98.0%
-------------------------------------------------------------------------------- (a) Includes Operating Partnership Units valued at the closing price of the Class A common stock (b) Includes pro rata share of consolidated and unconsolidated joint venture debt (c) Excludes properties under development (d) Before, when applicable, gain on sales of real estate, extraordinary loss and valuation reserves on investment in affiliate loans and joint ventures -------------------------------------------------------------------------------- 5
------------------------------------------------------------------------------------------------------------------------------- STATEMENTS OF OPERATIONS (In thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, ------------------------------------------------------------------------------------------------------------------------------- REVENUES 2001 2000 2001 2000 ------------------------------------------------------------------------------------------------------------------------------- Base Rents $ 111,394 $ 100,854 $ 330,072 $ 291,353 Tenant escalations and reimbursements 15,328 14,900 45,438 40,730 Equity in earnings of service companies and real estate joint ventures 505 706 1,704 3,893 Interest income on mortgage notes and notes receivable 1,584 1,901 4,651 6,377 Investment and other income 3,244 6,735 13,463 19,194 ------------------------------------------------------------------------------------------------------------------------------- Total Operating Revenues 132,055 125,096 395,328 361,547 ------------------------------------------------------------------------------------------------------------------------------- EXPENSES ------------------------------------------------------------------------------------------------------------------------------- Property operating expenses 26,358 24,751 73,581 67,051 Real estate taxes 17,873 16,504 52,518 48,727 Marketing, general and administrative 7,679 6,930 23,587 20,151 Depreciation and amortization 26,528 24,083 77,221 67,520 Interest expense 23,510 24,651 70,703 72,667 ------------------------------------------------------------------------------------------------------------------------------- Total Expenses 101,948 96,919 297,610 276,116 ------------------------------------------------------------------------------------------------------------------------------- Income from operations before minority interests 30,107 28,177 97,718 85,431 Minority partners' interests in consolidated partnerships (3,065) (1,874) (12,885) (5,773) Limited partners' minority interest in the operating partnership (2,306) (2,351) (7,637) (6,920) Distributions to preferred unitholders (509) (660) (1,630) (1,981) ------------------------------------------------------------------------------------------------------------------------------- Income from operations before gain on sales of real estate, extraordinary loss and valuation reserves on investments in affiliate loans and joint ventures, net of limited partners' minority interest 24,227 23,292 75,566 70,757 Valuation reserves on investments in affiliate loans and joint ventures (145,935) -- (145,935) -- Gain on sales of real estate 870 13,507 870 19,377 Extraordinary loss on extinguishment of debt (2,595) (1,396) (2,595) (1,396) ------------------------------------------------------------------------------------------------------------------------------- Income (loss) before dividends to preferred shareholders (123,433) 35,403 (72,094) 88,738 Dividends to preferred shareholders (5,487) (5,425) (16,379) (19,946) ------------------------------------------------------------------------------------------------------------------------------- Net income (loss) available to common shareholders $(128,920) $ 29,978 $ (88,473) $ 68,792 =============================================================================================================================== Net income (loss) available to: Class A Shareholders $ (97,944) $ 22,143 $ (67,526) $ 50,244 Class B Shareholders $ (30,976) $ 7,835 $ (20,947) $ 18,548 PER SHARE DATA Basic income from operations before gain on sales of real estate, extraordinary loss and valuation reserves on investments in affiliate loans and joint ventures: Class A common stock $0.29 $ 0.29 $ 0.94 $ 0.98 Class B common stock $0.44 $ 0.45 $ 1.41 $ 1.50 Diluted income from operations before gain on sales of real estate, extraordinary loss and valuation reserves on investments in affiliate loans and joint ventures: Class A common stock $0.28 $ 0.29 $ 0.93 $ 0.97 Class B common stock $0.31 $ 0.32 $ 1.01 $ 1.06 Basic net income (loss): Class A common stock before extraordinary loss $ (1.93) $ 0.51 $ (1.38) $ 1.21 Extraordinary loss per Class A common share $ (0.04) $ (0.02) $ (0.04) $ (0.02) --------------------------- ---------------------------- Basic net income (loss) per Class A common share $ (1.97) $ 0.49 $ (1.42) $ 1.19 =========================== ============================ Class B common stock before extraordinary loss $ (2.95) $ 0.80 $ (1.98) $ 1.84 Extraordinary loss per Class B common share $ (0.06) $ (0.04) $ (0.06) $ (0.04) --------------------------- ---------------------------- Basic net income (loss) per Class B common share $ (3.01) $ 0.76 $ (2.04) $ 1.80 =========================== ============================ Diluted net income (loss): Class A common stock $ (1.97) $ 0.48 $ (1.42) $ 1.18 Class B common stock $ (3.01) $ 0.53 $ (2.04) $ 1.28 Basic weighted average common shares outstanding: Class A common stock 49,715 45,178 47,489 42,312 Class B common stock 10,284 10,284 10,284 10,284 Diluted weighted average common shares outstanding: Class A common stock 49,715 49,818 47,489 42,736 Class B common stock 10,284 10,284 10,284 10,284
6 -------------------------------------------------------------------------------- FUNDS FROM OPERATIONS ("FFO") AND CASH AVAILABLE FOR DISTRIBUTION ("CAD") (in thousands, except per share / unit data)
Three Months Ended September 30, ------------------------------------------------------------------------------------------------------------------------------- 2001 2000 ------------------------------------------------------------------------------------------------------------------------------- FUNDS FROM OPERATIONS ------------------------------------------------------------------------------------------------------------------------------- Net income (loss) available to common shareholders $ (128,920) $ 29,978 Add back: Real estate depreciation and amortization 26,340 23,632 Minority partners' interests in consolidated partnerships 3,065 1,874 Limited partners' minority interest in the operating partnership -- 4,050 Valuation reserves on investments in affiliate loans and joint ventures 163,000 -- Extraordinary loss on extinguishment of debt (net of limited partners' minority interest) 2,595 1,396 Less: Limited partners' minority interest in the operating partnership 14,657 -- Gain on sales of real estate 972 15,206 Amounts distributable to minority partners in consolidated partnerships 4,206 2,247 ------------------------------------------------------------------------------------------------------------------------------- Basic Funds From Operations $ 46,245 $ 43,477 ------------------------------------------------------------------------------------------------------------------------------- Add dividends and distributions on dilutive shares and units: Series A preferred stock $ 4,381 $ 4,381 Series B preferred stock 1,106 1,044 Minority partners' preferred interest -- 1,594 Limited partners' preferred interest 509 660 ------------------------------------------------------------------------------------------------------------------------------- Diluted FFO $ 52,241 $ 51,156 =============================================================================================================================== Diluted weighted average shares and units outstanding: Common shares 59,999 55,462 Limited operating partnership units 7,652 7,695 Common stock equivalents 441 588 Series A preferred stock 8,060 8,060 Series B preferred stock 1,919 1,919 Minority partners' preferred interest -- 3,454 Limited partners' preferred interest 1,056 1,367 ------------------------------------------------------------------------------------------------------------------------------- Total diluted weighted average shares and units outstanding 79,127 78,545 =============================================================================================================================== Diluted FFO per weighted average share or unit $ 0.66 $ 0.65 Diluted weighted average dividends or distributions per share or unit $ 0.45 $ 0.41 Diluted FFO payout ratio 68.7% 63.7% ------------------------------------------------------------------------------------------------------------------------------- CASH AVAILABLE FOR DISTRIBUTION ------------------------------------------------------------------------------------------------------------------------------- Basic FFO $ 46,245 $ 43,477 Less: Straight line rents (a) 9,730 12,153 Non-incremental capitalized tenant improvements and leasing commissions 3,105 4,239 Non-incremental capitalized improvements 1,996 1,075 ------------------------------------------------------------------------------------------------------------------------------- Basic Cash Available for Distribution $ 31,414 $ 26,010 ------------------------------------------------------------------------------------------------------------------------------- Add dividends and distributions on dilutive shares and units: Series A preferred stock $ -- $ -- Series B preferred stock -- -- Minority partners' preferred interest -- -- Limited partners' preferred interest 260 -- ------------------------------------------------------------------------------------------------------------------------------- Diluted CAD $ 31,674 $ 26,010 =============================================================================================================================== Diluted weighted average shares and units outstanding: Common shares 59,999 55,462 Limited operating partnership units 7,652 7,695 Common stock equivalents 441 588 Series A preferred stock -- -- Series B preferred stock -- -- Minority partners' preferred interest -- -- Limited partners' preferred interest 566 -- ------------------------------------------------------------------------------------------------------------------------------- Diluted weighted average shares and units outstanding 68,658 63,745 =============================================================================================================================== Diluted CAD per weighted average share or unit $ 0.46 $ 0.41 Diluted weighted average dividends or distributions per share or unit $ 0.46 $ 0.42 Diluted CAD payout ratio 99.3% 103.2% ------------------------------------------------------------------------------------------------------------------------------- 7 Nine Months Ended September 30, --------------------------------------------------------------------------------------------------------------------- 2001 2000 --------------------------------------------------------------------------------------------------------------------- FUNDS FROM OPERATIONS --------------------------------------------------------------------------------------------------------------------- Net income (loss) available to common shareholders $ (88,473) $ 68,792 Add back: Real estate depreciation and amortization 76,055 66,184 Minority partners' interests in consolidated partnerships 12,885 5,773 Limited partners' minority interest in the operating partnership -- 9,411 Valuation reserves on investments in affiliate loans and joint ventures 163,000 -- Extraordinary loss on extinguishment of debt (net of limited partners' minority interest) 2,595 1,396 Less: Limited partners' minority interest in the operating partnership 9,326 -- Gain on sales of real estate 972 21,868 Amounts distributable to minority partners in consolidated partnerships 15,010 6,764 --------------------------------------------------------------------------------------------------------------------- Basic Funds From Operations $ 140,754 $ 122,924 --------------------------------------------------------------------------------------------------------------------- Add dividends and distributions on dilutive shares and units: Series A preferred stock $ 13,143 $ 13,143 Series B preferred stock 3,236 6,803 Minority partners' preferred interest 2,624 4,781 Limited partners' preferred interest 1,630 1,981 --------------------------------------------------------------------------------------------------------------------- Diluted FFO $ 161,387 $ 149,632 ===================================================================================================================== Diluted weighted average shares and units outstanding: Common shares 57,773 52,595 Limited operating partnership units 7,703 7,697 Common stock equivalents 429 424 Series A preferred stock 8,060 8,060 Series B preferred stock 1,919 4,315 Minority partners' preferred interest 1,898 3,454 Limited partners' preferred interest 1,182 1,367 --------------------------------------------------------------------------------------------------------------------- Total diluted weighted average shares and units outstanding 78,964 77,912 ===================================================================================================================== Diluted FFO per weighted average share or unit $ 2.04 $ 1.92 Diluted weighted average dividends or distributions per share or unit $ 1.32 $ 1.22 Diluted FFO payout ratio 64.6% 63.7% --------------------------------------------------------------------------------------------------------------------- CASH AVAILABLE FOR DISTRIBUTION --------------------------------------------------------------------------------------------------------------------- Basic FFO $ 140,754 $ 122,924 Less: Straight line rents (a) 31,743 24,991 Non-incremental capitalized tenant improvements and leasing commissions 9,849 8,982 Non-incremental capitalized improvements 4,260 3,773 --------------------------------------------------------------------------------------------------------------------- Basic Cash Available for Distribution $ 94,902 $ 85,178 --------------------------------------------------------------------------------------------------------------------- Add dividends and distributions on dilutive shares and units: Series A preferred stock $ -- $ -- Series B preferred stock -- -- Minority partners' preferred interest 2,624 4,781 Limited partners' preferred interest 1,630 816 --------------------------------------------------------------------------------------------------------------------- Diluted CAD $ 99,156 $ 90,775 ===================================================================================================================== Diluted weighted average shares and units outstanding: Common shares 57,773 52,595 Limited operating partnership units 7,703 7,697 Common stock equivalents 429 424 Series A preferred stock -- -- Series B preferred stock -- -- Minority partners' preferred interest 1,898 3,454 Limited partners' preferred interest 1,182 598 --------------------------------------------------------------------------------------------------------------------- Diluted weighted average shares and units outstanding 68,985 64,768 ===================================================================================================================== Diluted CAD per weighted average share or unit $ 1.44 $ 1.40 Diluted weighted average dividends or distributions per share or unit $ 1.33 $ 1.24 Diluted CAD payout ratio 92.6% 88.5% ----------------------------------------------------------------------------------------------------------------------
(a) Includes straight line rental income attributable to 919 Third Avenue, New York, NY of $5,939, $8,175, $20,323 and $13,560, respectively. -------------------------------------------------------------------------------- 8
DRAFT -------------------------------------------------------------------------------------------------------------------- CONSOLIDATED BALANCE SHEETS (In thousands) September 30, December 31, 2001 2000 -------------------------------------------------------------------------------------------------------------------- ASSETS -------------------------------------------------------------------------------------------------------------------- Commercial real estate properties, at cost: Land $ 389,186 $ 396,482 Building and improvements 2,281,906 2,219,448 Developments in progress: Land 68,734 60,918 Development costs 74,198 93,759 Furniture, fixtures, and equipment 7,418 7,138 -------------------------------------------------------------------------------------------------------------------- 2,821,442 2,777,745 Less: accumulated depreciation and amortization (346,315) (288,479) -------------------------------------------------------------------------------------------------------------------- Investment in real estate, net of accumulated depreciation 2,475,127 2,489,266 Investments in real estate joint ventures 5,663 5,348 Investments in mortgage notes and notes receivable 55,721 58,220 Investments in affiliate loans, joint ventures and subsidiaries 80,569 215,660 Cash and cash equivalents 38,466 17,843 Tenant receivables 10,065 11,511 Deferred rents receivable 96,773 67,930 Prepaid expenses and other assets 32,164 68,895 Contract and land deposits and pre-acquisition costs 3,481 1,676 Deferred leasing and loan costs 63,622 61,681 -------------------------------------------------------------------------------------------------------------------- TOTAL ASSETS $ 2,861,651 $ 2,998,030 ==================================================================================================================== LIABILITIES AND STOCKHOLDER'S EQUITY -------------------------------------------------------------------------------------------------------------------- LIABILITIES: Mortgage notes payable $ 762,526 $ 728,971 Unsecured credit facility 246,600 216,600 Senior unsecured notes 449,443 449,385 Accrued expenses and other liabilities 74,491 95,393 Dividends and distributions payable 32,952 28,801 -------------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES 1,566,012 1,519,150 -------------------------------------------------------------------------------------------------------------------- MINORITY INTERESTS: Minority partners' interests in consolidated partnerships 140,845 226,350 Preferred unit interest in the operating partnership 30,965 42,518 Limited partners' minority interest in the operating partnership 83,140 97,353 -------------------------------------------------------------------------------------------------------------------- TOTAL MINORITY INTERESTS 254,950 366,221 -------------------------------------------------------------------------------------------------------------------- STOCKHOLDERS' EQUITY: Preferred Stock, $.01 par value, 25,000,000 shares authorized Series A - 9,192,000 shares issued and outstanding 92 92 Series B - 2,000,000 shares issued and outstanding 20 20 Common Stock, $.01 par value, 100,000,000 shares authorized Class A - 49,806,885 and 45,352,286 shares issued and outstanding, respectively 498 454 Class B - 10,283,513 shares issued and outstanding 103 103 Additional paid in capital 1,039,976 1,111,990 -------------------------------------------------------------------------------------------------------------------- TOTAL STOCKHOLDERS' EQUITY 1,040,689 1,112,659 -------------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,861,651 $ 2,998,030 ====================================================================================================================
9 -------------------------------------------------------------------------------- DEBT SUMMARY AT SEPTEMBER 30, 2001 (Dollars in thousands)
DEBT BREAKDOWN ------------------------------------------------------------------------------------------------------------------------------------ % of Weighted Average Weighted Average Balance Total Interest Rate Maturity (Years) ------------------------------------------------------------------------------------------------------------------------------------ Fixed Rate Secured Debt $ 762,526 52.3% 7.3% 10.1 Fixed Rate Senior Unsecured Notes (a) 449,443 30.8% 7.5% 5.8 Variable Rate Unsecured Credit Facility 246,600 16.9% 4.6% 2.2 ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average $1,458,569 100.0% 6.9% 7.4 ------------------------------------------------------------------------------------------------------------------------------------
DEBT AMORTIZATION AND MATURITY ------------------------------------------------------------------------------------------------------------------------------------ Secured Senior Unsecured Unsecured Credit Year Debt Notes Facility Total ------------------------------------------------------------------------------------------------------------------------------------ 2001 $ 2,629 $ 2,629 2002 20,047 20,047 2003 12,550 246,600 259,150 2004 16,099 100,000 (a) 116,099 2005 33,004 33,004 2006 144,006 144,006 2007 72,165 150,000 222,165 2008 10,743 10,743 2009 110,608 200,000 (a) 310,608 2010 36,626 36,626 Thereafter 304,049 304,049 ------------------------------------------------------------------------------------------------------------------------------------ Total Debt $762,526 $450,000 $246,600 $1,459,126 ------------------------------------------------------------------------------------------------------------------------------------
PROPERTY MORTGAGE DETAIL ------------------------------------------------------------------------------------------------------------------------------------ Interest Maturity Amortization Property $ Outstanding Rate Date Term (Years) ------------------------------------------------------------------------------------------------------------------------------------ 200 Broadhollow Road, Melville, NY (b) $ 6,442 7.75% June-02 30 310 East Shore Road, Great Neck, NY 2,322 8.00% July-02 Interest only 80 Orville Dr, Islip, NY 2,616 10.10% February-04 Interest only 395 North Service Road, Melville, NY 20,219 6.45% October-05 $34k per month 200 Summit Lake Drive, Valhalla, NY 19,864 9.25% January-06 25 1350 Avenue of the Americas, NY, NY 75,000 6.52% June-06 (e) Landmark Square, Stamford, CT 46,302 8.02% October-06 25 100 Summit Lake Drive, Valhalla, NY 20,674 8.50% April-07 15 333 Earle Ovington Blvd, Mitchel Field, NY (c) 55,008 7.72% August-07 25 810 Seventh Avenue, NY,NY 84,619 7.73% August-09 25 100 Wall Street, NY, NY 36,669 7.73% August-09 25 6900 Jericho Turnpike, Syosset, NY 7,484 8.07% July-10 25 6800 Jericho Turnpike, Syosset, NY 14,181 8.07% July-10 25 580 White Plains Road, Tarrytown, NY 12,925 7.86% September-10 25 919 Third Ave, NY, NY 249,790 6.867% October-11 30 110 Bi-County Blvd., Farmingdale, NY 3,899 9.13% November-12 20 One Orlando Center, Orlando, FL (d) 39,070 6.82% November-27 28 120 West 45th Street, NY,NY (d) 65,442 6.82% November-27 28 ------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average $762,526 7.28% ------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------
(a) These notes were issued at an aggregate discount of $738,000, which is being amortized over the term of the Senior Unsecured Notes to which they relate. Current unamortized discount is $557,000 (b) Paid off subsequent to quarter end (c) The Company has a 60% general partnership interest in this property and its proportionate share of the aggregate principal amount is approximately $33.1 million (d) Subject to interest rate adjustment on November 1, 2004 (e) Interest only for the 1st year; 30 years thereafter (f) The Company has a 60% interest in an unconsolidated joint venture property. The pro rata share of this debt is approximately $8.0 million -------------------------------------------------------------------------- 10 -------------------------------------------------------------------------------- PREFERRED SECURITIES AT SEPTEMBER 30, 2001 (in thousands) The following table sets forth certain information regarding the Company's preferred securites, as of September 30, 2001.
------------------------------------------------------------------------------------------------------------------------------------ Liquidation Current Conversion price Security Preference Value Yield Per Share Issuance date ------------------------------------------------------------------------------------------------------------------------------------ 7 5/8 % Series A Convertible Cumulative Preferred Stock $229,800 7.625% $28.51 April 1998 Series B Convertible Cumulitive Peferred Stock 50,000 8.850% $26.05 June 1999 Series B Preferred Units of Limited Partnership Interest 14,384 6.337% $32.51 April 1998 Series C Preferred Units of Limited Partnership Interest 10,581 6.337% $29.39 April 1998 Series D Preferred Units of Limited Partnership Interest 6,000 6.337% $29.12 July 1998 ------------------------------------------------------------------------------------------------------------------------------------ Total $310,765 ====================================================================================================================================
11 ------------------------------------------------------------------------------ SAME STORE PERFORMANCE For the 3 month period September 30, 2001 vs. September 30, 2000 (In thousands) REGIONAL BREAKDOWN ------------------ CASH REVENUE September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Long Island $ 32,750 $ 31,111 $ 1,639 5.3% Westchester 16,790 17,560 (770) -4.4% Connecticut 8,970 8,380 590 7.0% New Jersey 11,032 10,678 354 3.3% New York City 32,856 26,836 6,020 22.4% Florida 2,374 2,274 100 4.4% --------------------------------------------------------------------------- Total $ 104,772 $ 96,839 $ 7,933 8.2% --------------------------------------------------------------------------- GAAP REVENUE September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Long Island $ 33,791 $ 32,491 $ 1,300 4.0% Westchester 17,198 18,042 (844) -4.7% Connecticut 8,972 8,441 531 6.3% New Jersey 11,180 11,083 97 0.9% New York City 40,170 36,047 4,123 11.4% Florida 2,389 2,164 225 10.4% --------------------------------------------------------------------------- Total $ 113,700 $ 108,268 $ 5,432 5.0% --------------------------------------------------------------------------- OPERATING EXPENSES September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Long Island $ 5,767 $ 5,815 $ (48) -0.8% Westchester 4,245 4,723 (478) -10.1% Connecticut 2,112 1,760 352 20.0% New Jersey 2,026 1,746 280 16.0% New York City 8,670 8,169 501 6.1% Florida 408 364 44 12.1% --------------------------------------------------------------------------- Total $ 23,228 $ 22,577 $ 651 2.9% --------------------------------------------------------------------------- REAL ESTATE TAXES September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Long Island $ 5,863 $ 5,499 $ 364 6.6% Westchester 2,268 2,201 67 3.0% Connecticut 743 717 26 3.6% New Jersey 1,415 1,296 119 9.2% New York City 6,297 5,756 541 9.4% Florida 246 211 35 16.6% --------------------------------------------------------------------------- Total $ 16,832 $ 15,680 $ 1,152 7.3% --------------------------------------------------------------------------- CASH NOI September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Long Island $ 21,120 $ 19,797 $ 1,323 6.7% Westchester 10,277 10,636 (359) -3.4% Connecticut 6,115 5,903 212 3.6% New Jersey 7,591 7,636 (45) -0.6% New York City 17,889 12,911 4,978 38.6% Florida 1,720 1,699 21 1.2% --------------------------------------------------------------------------- Total $ 64,712 $ 58,582 $ 6,130 10.5% --------------------------------------------------------------------------- GAAP NOI September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Long Island $ 22,161 $ 21,177 $ 984 4.6% Westchester 10,685 11,118 (433) -3.9% Connecticut 6,117 5,964 153 2.6% New Jersey 7,739 8,041 (302) -3.8% New York City 25,203 22,122 3,081 13.9% Florida 1,735 1,589 146 9.2% --------------------------------------------------------------------------- Total $ 73,640 $ 70,011 $ 3,629 5.2% --------------------------------------------------------------------------- --------------------------------------------------------------------------- (a) Includes two retail properties --------------------------------------------------------------------------- PROPERTY TYPE BREAKDOWN ----------------------- CASH REVENUE September-01 September-00 $ Change % Change ---------------------------------------------------------------------------- Office $ 92,934 $ 85,326 $ 7,608 8.9% Industrial (a) 11,838 11,513 325 2.8% ---------------------------------------------------------------------------- Total $ 104,772 $ 96,839 $ 7,933 8.2% ---------------------------------------------------------------------------- GAAP REVENUE September-01 September-00 $ Change % Change ---------------------------------------------------------------------------- Office $ 101,636 $ 96,224 $ 5,412 5.6% Industrial (a) 12,064 12,044 20 0.2% ---------------------------------------------------------------------------- Total $ 113,700 $ 108,268 $ 5,432 5.0% ---------------------------------------------------------------------------- OPERATING EXPENSES September-01 September-00 $ Change % Change ---------------------------------------------------------------------------- Office $ 22,488 $ 21,811 $ 677 3.1% Industrial (a) 740 766 (26) -3.4% ---------------------------------------------------------------------------- Total $ 23,228 $ 22,577 $ 651 2.9% ---------------------------------------------------------------------------- REAL ESTATE TAXES September-01 September-00 $ Change % Change ---------------------------------------------------------------------------- Office $ 14,769 $ 13,687 $ 1,082 7.9% Industrial (a) 2,063 1,993 70 3.5% ---------------------------------------------------------------------------- Total $ 16,832 $ 15,680 $ 1,152 7.3% ---------------------------------------------------------------------------- CASH NOI September-01 September-00 $ Change % Change ---------------- ----------------------------------------------------------- Office $ 55,677 $ 49,828 $ 5,849 11.7% Industrial (a) 9,035 8,754 281 3.2% ---------------------------------------------------------------------------- Total $ 64,712 $ 58,582 $ 6,130 10.5% ---------------------------------------------------------------------------- GAAP NOI September-01 September-00 $ Change % Change ---------------------------------------------------------------------------- Office $ 64,379 $ 60,726 $ 3,653 6.0% Industrial (a) 9,261 9,285 (24) -0.3% ---------------------------------------------------------------------------- Total $ 73,640 $ 70,011 $ 3,629 5.2% ---------------------------------------------------------------------------- 12 ------------------------------------------------------------------------------- SAME STORE PERFORMANCE For the 9 month period September 30, 2001 vs. September 30, 2000 (In thousands) REGIONAL BREAKDOWN ------------------ CASH REVENUE September-01 September-00 $ Change % Change ----------------------------------------------------------------------------- Long Island $ 94,477 $ 89,745 $ 4,732 5.3% Westchester 50,865 50,084 781 1.6% Connecticut 26,228 23,912 2,316 9.7% New Jersey 29,777 26,814 2,963 11.1% New York City 93,544 84,349 9,195 10.9% Florida 6,969 6,858 111 1.6% ----------------------------------------------------------------------------- Total $ 301,860 $ 281,762 $ 20,098 7.1% ----------------------------------------------------------------------------- GAAP REVENUE September-01 September-00 $ Change % Chang ----------------------------------------------------------------------------- Long Island $ 97,712 $ 92,959 $ 4,753 5.1% Westchester 52,219 51,333 886 1.7% Connecticut 26,334 24,041 2,293 9.5% New Jersey 30,038 27,098 2,940 10.8% New York City 116,928 102,300 14,628 14.3% Florida 7,045 7,070 (25) -0.4% ----------------------------------------------------------------------------- Total $ 330,276 $ 304,801 $ 25,475 8.4% ----------------------------------------------------------------------------- OPERATING EXPENSES September-01 September-00 $ Change % Change ----------------------------------------------------------------------------- Long Island $ 15,487 $ 15,519 $ (32) -0.2% Westchester 12,241 12,397 (156) -1.3% Connecticut 5,922 5,445 477 8.8% New Jersey 5,159 4,789 370 7.7% New York City 23,068 20,640 2,428 11.8% Florida 1,151 1,070 81 7.6% ----------------------------------------------------------------------------- Total $ 63,028 $ 59,860 $ 3,168 5.3% ----------------------------------------------------------------------------- REAL ESTATE TAXES September-01 September-00 $ Change % Change ----------------------------------------------------------------------------- Long Island $ 17,211 $ 16,388 $ 823 5.0% Westchester 6,797 6,547 250 3.8% Connecticut 2,176 1,891 285 15.1% New Jersey 3,533 3,312 221 6.7% New York City 17,953 16,764 1,189 7.1% Florida 737 688 49 7.1% ----------------------------------------------------------------------------- Total $ 48,407 $ 45,590 $ 2,817 6.2% ----------------------------------------------------------------------------- CASH NOI September-01 September-00 $ Change % Change ------------------------------------------------------------------------------ Long Island $ 61,779 $ 57,838 $ 3,941 6.8% Westchester 31,827 31,140 687 2.2% Connecticut 18,130 16,576 1,554 9.4% New Jersey 21,085 18,713 2,372 12.7% New York City 52,523 46,945 5,578 11.9% Florida 5,081 5,100 (19) -0.4% ----------------------------------------------------------------------------- Total $ 190,425 $ 176,312 $ 14,113 8.0% ----------------------------------------------------------------------------- GAAP NOI September-01 September-00 $ Change % Chang ----------------------------------------------------------------------------- Long Island $ 65,014 $ 61,052 $ 3,962 6.5% Westchester 33,181 32,389 792 2.4% Connecticut 18,236 16,705 1,531 9.2% New Jersey 21,346 18,997 2,349 12.4% New York City 75,907 64,896 11,011 17.0% Florida 5,157 5,312 (155) -2.9% ----------------------------------------------------------------------------- Total $ 218,841 $ 199,351 $ 19,490 9.8% ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- (a) Includes two retail properties ---------------------------------------------------------------------------- PROPERTY TYPE BREAKDOWN ----------------------- CASH REVENUE September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Office $ 266,353 $ 247,278 $ 19,075 7.7% Industrial (a) 35,507 34,484 1,023 3.0% --------------------------------------------------------------------------- Total $ 301,860 $ 281,762 $ 20,098 7.1% --------------------------------------------------------------------------- GAAP REVENUE September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Office $ 293,737 $ 269,125 $ 24,612 9.1% Industrial (a) 36,539 35,676 863 2.4% --------------------------------------------------------------------------- Total $ 330,276 $ 304,801 $ 25,475 8.4% --------------------------------------------------------------------------- OPERATING EXPENSES September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Office $ 60,302 $ 57,470 $ 2,832 4.9% Industrial (a) 2,726 2,390 336 14.1% --------------------------------------------------------------------------- Total $ 63,028 $ 59,860 $ 3,168 5.3% --------------------------------------------------------------------------- REAL ESTATE TAXES September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Office $ 42,277 $ 39,518 $ 2,759 7.0% Industrial (a) 6,130 6,072 58 1.0% --------------------------------------------------------------------------- Total $ 48,407 $ 45,590 $ 2,817 6.2% --------------------------------------------------------------------------- CASH NOI September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Office $ 163,774 $ 150,290 $ 13,484 9.0% Industrial (a) 26,651 26,022 629 2.4% --------------------------------------------------------------------------- Total $ 190,425 $ 176,312 $ 14,113 8.0% --------------------------------------------------------------------------- GAAP NOI September-01 September-00 $ Change % Change --------------------------------------------------------------------------- Office $ 191,158 $ 172,137 $ 19,021 11.0% Industrial (a) 27,683 27,214 469 1.7% --------------------------------------------------------------------------- Total $ 218,841 $ 199,351 $ 19,490 9.8% --------------------------------------------------------------------------- 13
------------------------------------------------------------------------------------------------------------------------------------ PORTFOLIO SNAPSHOT Based on 3rd quarter 2001 GAAP CONSOLIDATED AMOUNTS (A) PRO FORMA AMOUNTS (B) --------------------------------- ------------------------- ------------------------------------------------------------------------------------------------------------------------------------ GEOGRAPHIC DISTRIBUTION ------------------------------------------------------------------------------------------------------------------------------------ Square Cash Cash GAAP Square Cash Cash GAAP Feet Revenue NOI NOI Feet Revenue NOI NOI ------------------------------------------------------------------------------------------------------------------------------------ Long Island Office 20% 23% 23% 22% 18% 19% 19% 19% Industrial (c) 29% 9% 11% 10% 30% 9% 11% 11% ------------------------------------------------------------------------------------------------------------------------------------ Subtotal - Long Island 49% 32% 34% 32% 48% 28% 30% 30% Westchester Office 16% 19% 20% 19% 16% 19% 20% 20% Industrial 1% 0% 0% 0% 1% 0% 0% 1% ------------------------------------------------------------------------------------------------------------------------------------ Subtotal - Westchester 17% 19% 20% 19% 17% 19% 20% 21% Connecticut Office 5% 7% 7% 6% 5% 6% 6% 5% Industrial 2% 1% 1% 1% 2% 1% 1% 1% ------------------------------------------------------------------------------------------------------------------------------------ Subtotal - Connecticut 7% 8% 8% 7% 7% 7% 7% 6% New Jersey Office 9% 12% 13% 12% 9% 11% 12% 11% Industrial 2% 1% 1% 1% 2% 1% 1% 1% ------------------------------------------------------------------------------------------------------------------------------------ Subtotal - New Jersey 11% 13% 14% 13% 11% 12% 13% 12% New York City Office 17% 29% 24% 29% 18% 34% 30% 31% ------------------------------------------------------------------------------------------------------------------------------------ Subtotal - New York City 17% 29% 24% 29% 18% 34% 30% 31% ------------------------------------------------------------------------------------------------------------------------------------ PROPERTY TYPE ------------------------------------------------------------------------------------------------------------------------------------ Office 67% 89% 87% 88% 66% 89% 87% 86% Industrial 33% 11% 13% 12% 34% 11% 13% 14% ------------------------------------------------------------------------------------------------------------------------------------ SUBURBAN VS CBD ( OFFICE SPACE ONLY ) ------------------------------------------------------------------------------------------------------------------------------------ Suburban 62% 56% 60% 55% 61% 51% 54% 53% CBD 38% 44% 40% 45% 39% 49% 46% 47% ------------------------------------------------------------------------------------------------------------------------------------ (a) Information in accordance with GAAP accounting (b) Adjusted for pro rata share of consolidated and unconsolidated joint venture properties and free rent addback at 919 3rd Avenue (c) Includes 2 retail properties (d) The Company also owns a 357,000 square foot office building in Orlando, FL. Percentage calculations exclude this property ------------------------------------------------------------------------------------------------------------------------------------
14
------------------------------------------------------------------------------------------------------------------------------------ OCCUPANCY ANALYSIS As of September 30, 2001 ------------------------------------------------------------------------------------------------------------------------------------ NUMBER OF RENTABLE OCCUPANCY AS OF PROPERTY BUILDINGS SQUARE FEET JUN-01 SEP-01 --------------------------------------------------------------------------------------------------------------------------------- OFFICE PROPERTIES SUBURBAN OFFICE PARKS LONG ISLAND Nassau West Corporate Center, Mitchel Field, NY (1) 6 1,531,021 97.9% 97.2% Huntington Melville Corporate Center, Melville, NY (2) 7 1,053,354 99.3% 99.6% North Shore Atrium, Syosset, NY 2 304,177 96.8% 96.8% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - LONG ISLAND (3) 15 2,888,552 98.2% 97.9% WESTCHESTER Tarrytown Corporate Center, Tarrytown, NY 6 875,726 95.5% 93.2% Summit at Vallhalla, Vahalla, NY 3 699,045 90.1% 83.9% Mt. Pleasant Corporate Center, Valhalla, NY 2 162,004 94.3% 95.8% Reckson Executive Park, Rye Brook, NY 6 541,884 98.3% 99.2% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - WESTCHESTER 17 2,278,659 94.4% 92.0% NEW JERSEY Short Hills Office Center, Short Hills, NJ (4) 3 566,803 98.9% 100.0% Executive Hill Office Park, West Orange, NJ 4 391,382 99.5% 94.6% University Square, Princeton, NJ 3 131,643 100.0% 100.0% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - NEW JERSEY (3) 10 1,089,828 100.0% 98.0% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - SUBURBAN OFFICE PARK (3) 42 6,257,039 96.9% 95.6% --------------------------------------------------------------------------------------------------------------------------------- SUBURBAN STAND ALONE Long Island Office Properties 11 1,162,625 97.0% 97.9% New Jersey Office Properties 6 871,398 97.4% 98.8% Westchester Office Properties 2 282,889 100.0% 98.1% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - SUBURBAN STANDALONE 19 2,316,912 97.5% 98.3% --------------------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - SUBURBAN OFFICE (3) 61 8,573,951 97.8% 96.8% --------------------------------------------------------------------------------------------------------------------------------- CBD OFFICE CONNECTICUT Landmark Square, Stamford, CT 6 798,321 94.4% 93.7% Stamford Towers, Stamford, CT 2 324,867 100.0% 100.0% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - CONNECTICUT 8 1,123,188 96.1% 95.4% WESTCHESTER Standalone Office 4 668,916 96.0% 96.1% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - WESTCHESTER OFFICE 4 668,916 96.0% 96.1% NEW YORK CITY 919 Third Avenue 1 1,356,115 97.4% 98.1% 810 Seventh Avenue 1 692,060 99.8% 99.5% 100 Wall Street 1 466,226 99.0% 98.6% 120 W. 45th Street 1 443,109 95.0% 91.4% 1350 Ave. of the Americas 1 540,000 93.5% 95.5% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - NEW YORK CITY 5 3,497,510 97.2% 97.2% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL - CBD OFFICE 17 5,289,614 96.0% 96.7% --------------------------------------------------------------------------------------------------------------------------------- SUBTOTAL- OFFICE PROPERTIES (3) 78 13,863,565 97.0% 96.7% ---------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------ OCCUPANCY ANALYSIS As of September 30, 2001 ------------------------------------------------------------------------------------------------------------------------------------ SQUARE FEET AS A % OF NOI AS A % PROPERTY PROPERTY TYPE TOTAL PORTFOLIO PROPERTY TYPE TOTAL PORTFOLIO ------------------------------------------------------------------------------------------------------------------------------------ OFFICE PROPERTIES SUBURBAN OFFICE PARKS LONG ISLAND Nassau West Corporate Center, Mitchel Field, NY (1) 11.0% 7.4% 12.7% 11.1% Huntington Melville Corporate Center, Melville, NY (2) 7.6% 5.1% 5.9% 5.1% North Shore Atrium, Syosset, NY 2.2% 1.5% 1.7% 1.5% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - LONG ISLAND (3) 20.8% 14.0% 20.3% 17.6% WESTCHESTER Tarrytown Corporate Center, Tarrytown, NY 6.3% 4.2% 5.8% 5.0% Summit at Vallhalla, Vahalla, NY 5.0% 3.4% 6.4% 5.6% Mt. Pleasant Corporate Center, Valhalla, NY 1.2% 0.8% 1.0% 0.9% Reckson Executive Park, Rye Brook, NY 3.9% 2.6% 3.6% 3.1% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - WESTCHESTER 16.4% 11.0% 16.8% 14.6% NEW JERSEY Short Hills Office Center, Short Hills, NJ (4) 4.1% 2.7% 5.9% 5.1% Executive Hill Office Park, West Orange, NJ 2.8% 1.9% 2.3% 2.0% University Square, Princeton, NJ 0.9% 0.6% 0.9% 0.8% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - NEW JERSEY (3) 7.9% 5.3% 9.1% 7.9% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - SUBURBAN OFFICE PARK (3) 45.1% 30.2% 46.2% 40.1% ------------------------------------------------------------------------------------------------------------------------------------ SUBURBAN STAND ALONE Long Island Office Properties 8.4% 5.6% 6.6% 5.7% New Jersey Office Properties 6.3% 4.2% 5.8% 5.0% Westchester Office Properties 2.0% 1.4% 1.9% 1.6% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - SUBURBAN STANDALONE 16.7% 11.2% 14.2% 12.4% ------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - SUBURBAN OFFICE (3) 61.8% 41.4% 60.4% 52.5% ------------------------------------------------------------------------------------------------------------------------------------ CBD Office Connecticut Landmark Square, Stamford, CT 5.8% 3.9% 5.3% 4.6% Stamford Towers, Stamford, CT 2.3% 1.6% 2.4% 2.1% ------------------------------------------------------------------------------------------------------------------------------------ Subtotal - Connecticut 8.1% 5.4% 7.7% 6.7% Westchester Standalone Office 4.8% 3.2% 4.7% 4.1% ------------------------------------------------------------------------------------------------------------------------------------ Subtotal - Westchester Office 4.8% 3.2% 4.7% 4.1% New York City 919 Third Avenue 9.8% 6.6% 6.9% 6.0% 810 Seventh Avenue 5.0% 3.3% 6.7% 5.8% 100 Wall Street 3.4% 2.3% 3.7% 3.2% 120 W. 45th Street 3.2% 2.1% 4.9% 4.3% 1350 Ave. of the Americas 3.9% 2.6% 5.0% 4.3% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - NEW YORK CITY 25.2% 16.9% 27.1% 23.6% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL - CBD OFFICE 38.2% 25.6% 39.6% 34.4% ------------------------------------------------------------------------------------------------------------------------------------ SUBTOTAL- OFFICE PROPERTIES (3) 100.0% 67.0% 100.0% 86.9% ------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------ (1) Does not include 27,013 square feet leased to the health club at Omni. (2) Rentable square feet includes a recently completed 277,500 sf Class A office building which is currently 31% leased; percent leased excludes this property. (3) Percent leased excludes properties under development. (4) Rentable square feet includes a 129,508 sf building under redevelopment; percent leased excludes this property. ------------------------------------------------------------------------------------------------------------------------------------
15
------------------------------------------------------------------------------------------------------------------- OCCUPANCY ANALYSIS As of September 30, 2001 ------------------------------------------------------------------------------------------------------------------- Number of Rentable Occupancy as of Property Buildings Square Feet Jun-01 Sep-01 ------------------------------------------------------------------------------------------------------------------- INDUSTRIAL PROPERTIES LONG ISLAND INDUSTRIAL PROPERTIES Vanderbilt Industrial Park, Hauppauge, NY (1) 47 2,379,895 97.9% 97.4% Airport International Plaza, Bohemia, NY 21 1,289,865 97.3% 98.1% County Line Industrial Center, Melville, NY 4 342,174 100.0% 100.0% Other Submarkets Farmingdale 3 520,615 99.9% 99.9% Melville 4 246,169 100.0% 100.0% Islip/Islandia 6 212,400 100.0% 100.0% Hauppauge 2 195,942 99.1% 99.1% Other 8 708,740 100.0% 96.7% ------------------------------------------------------------------------------------------------------------------- Subtotal - Long Island Industrial (2) 95 5,895,800 98.6% 98.1% ------------------------------------------------------------------------------------------------------------------- Stand-alone Westchester Industrial Properties 2 139,690 100.0% 100.0% Stand-alone Connecticut Industrial Properties 1 452,414 100.0% 100.0% Stand-alone New Jersey Industrial Properties 5 324,254 82.4% 82.4% ------------------------------------------------------------------------------------------------------------------- Subtotal- Industrial Properties (2) 103 6,812,158 97.9% 97.5% ------------------------------------------------------------------------------------------------------------------- Retail Properties 2 20,000 50.0% 50.0% ------------------------------------------------------------------------------------------------------------------- Total - All Properties (2) 183 20,695,723 97.3% 96.8% ------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------------------- OCCUPANCY ANALYSIS As of September 30, 2001 --------------------------------------------------------------------------------------------------------------------------------- Square Feet as a % of NOI as a % Property Property Type Total Portfolio Property Type Total Portfolio --------------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL PROPERTIES LONG ISLAND INDUSTRIAL PROPERTIES Vanderbilt Industrial Park, Hauppauge, NY (1) 34.9% 11.5% 27.8% 3.6% Airport International Plaza, Bohemia, NY 18.9% 6.2% 19.5% 2.6% County Line Industrial Center, Melville, NY 5.0% 1.7% 5.0% 0.7% Other Submarkets Farmingdale 7.6% 2.5% 7.9% 1.0% Melville 3.6% 1.2% 5.6% 0.7% Islip/Islandia 3.1% 1.0% 2.2% 0.3% Hauppauge 2.9% 0.9% 3.3% 0.4% Other 10.4% 3.4% 10.6% 1.4% -------------------------------------------------------------------------------------------------------------------------------- Subtotal - Long Island Industrial (2) 86.5% 28.5% 82.0% 10.8% -------------------------------------------------------------------------------------------------------------------------------- Stand-alone Westchester Industrial Properties 2.1% 0.7% 3.5% 0.5% Stand-alone Connecticut Industrial Properties 6.6% 2.2% 9.1% 1.2% Stand-alone New Jersey Industrial Properties 4.8% 1.6% 5.4% 0.7% -------------------------------------------------------------------------------------------------------------------------------- Subtotal- Industrial Properties (2) 100.0% 32.9% 100.0% 13.1% -------------------------------------------------------------------------------------------------------------------------------- Retail Properties 0.1% 0.1% -0.1% 0.0% -------------------------------------------------------------------------------------------------------------------------------- Total - All Properties (2) 100.0% 100.0% 100.0% 100.0% -------------------------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------------------------- (1) Rentable square feet includes a 56,875 square foot vacant building under redevelopment, percent leased excludes this property (2) Percent leased excludes properties under development --------------------------------------------------------------------------------------------------------------------------------
16
------------------------------------------------------------------------------------------------------------------------ LEASING STATISTICS For the three months ended September 30, 2001 ------------------------------------------------------------------------------------------------------------------------ EXECUTED LEASES (a) ------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ # of Total Average Average Average Transactions Sq. Ft. Base Rent Effective Rent Term (Years) ------------------------------------------------------------------------------------------------------------------------ OFFICE PORTFOLIO Long Island 21 138,326 $23.64 $21.49 5.6 Westchester 17 82,263 $26.72 $24.97 6.4 Connecticut 2 7,490 $28.44 $27.40 4.9 New Jersey (b) 6 250,219 $29.58 $27.78 2.0 New York City 3 18,797 $59.12 $52.01 9.3 ------------------------------------------------------------------------------------------------------------------------ Totals/Weighted Average 49 497,095 $28.55 $26.48 4.0 ------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ INDUSTRIAL PORTFOLIO Long Island 13 249,292 $7.25 $6.92 7.7 ------------------------------------------------------------------------------------------------------------------------ Totals/Weighted Average 13 249,292 $7.25 $6.92 7.7 ------------------------------------------------------------------------------------------------------------------------ RESEARCH & DEVELOPMENT PORTFOLIO ------------------------------------------------------------------------------------------------------------------------ Totals/Weighted Average 0 0 ------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ PORTFOLIO TOTALS 62 746,387 ------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------ SAME SPACE STATISTICS ------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ Total Base Rent GAAP Rent Property Type Sq. Ft. Expiration Current (c) % Change Expiration Current (c) % Change ------------------------------------------------------------------------------------------------------------------------ Office 424,419 $23.47 $27.08 15.4% $22.77 $27.71 21.7% Industrial 241,192 $6.37 $6.50 2.0% $6.08 $7.19 18.3% Research & Development 0 ------------------------------------------------------------------------------------------------------------------------ Totals/Weighted Average 665,611 $17.27 $19.62 13.6% $16.72 $20.27 21.2% ------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ TENANT RETENTION ------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ Leases Sq. Ft Sq. Ft Renewal Property Type Expiring (d) Expiring (d) Renewing Percentage ------------------------------------------------------------------------------------------------------------------------ Office 38 284,537 181,960 63.9% Industrial 11 250,882 208,162 83.0% Research & Development 1 24,000 0 0.0% ------------------------------------------------------------------------------------------------------------------------ Totals 50 559,419 390,122 69.7% ------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------- (a) Includes new and renewed leases during the period (b) Statistics include a 19 month 195,000 sf license agreement executed with American Express (c) Represents either renewed or released space (d) Includes early renewals ------------------------------------------------------------------------------
17
------------------------------------------------------------------------------------------------------------------------------- LEASING STATISTICS For the 12 months ended September 30, 2001 ------------------------------------------------------------------------------------------------------------------------------- EXECUTED LEASES (a) ------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------- # of Total Average Average Average Transactions Sq. Ft. Base Rent Effective Rent Term (Years) ------------------------------------------------------------------------------------------------------------------------------- OFFICE PORTFOLIO Long Island 58 517,442 $27.06 $23.78 8.8 Westchester 78 505,758 $25.71 $23.67 5.7 Connecticut 24 115,729 $29.88 $28.86 5.2 New Jersey 34 599,595 $26.22 $23.82 5.2 New York City 17 134,467 $65.51 $60.37 10.0 ------------------------------------------------------------------------------------------------------------------------------- Totals/Weighted Average 211 1,872,991 $29.36 $26.70 6.7 ------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------- INDUSTRIAL PORTFOLIO Long Island 37 661,899 $7.09 $6.78 9.0 New Jersey 4 65,076 $7.79 $7.15 4.6 ------------------------------------------------------------------------------------------------------------------------------- Totals/Weighted Average 41 726,975 $7.15 $6.81 8.6 ------------------------------------------------------------------------------------------------------------------------------- RESEARCH & DEVELOPMENT PORTFOLIO Long Island 5 35,493 $14.58 $13.06 5.8 Westchester 4 56,737 $18.40 $16.17 6.6 ------------------------------------------------------------------------------------------------------------------------------- Totals/Weighted Average 9 92,230 $16.93 $14.97 6.3 ------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------- PORTFOLIO TOTALS 261 2,692,196 -------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------- SAME SPACE STATISTICS ------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------- Total Base Rent GAAP Rent Property Type Sq. Ft. Expiration Current (b) % Change Expiration Current (b) % Change ------------------------------------------------------------------------------------------------------------------------------- Office 1,196,088 $23.84 $27.18 14.0% $23.19 $28.46 22.7% Industrial 554,146 $ 6.73 $ 7.34 9.1% $ 6.44 $ 7.77 20.7% Research & Development 27,088 $14.04 $13.40 -4.6% $12.90 $14.16 9.8% ------------------------------------------------------------------------------------------------------------------------------- Totals/Weighted Average 1,777,322 $18.36 $20.78 13.2% $17.81 $21.79 22.3% -------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------- TENANT RETENTION ------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------- Leases Sq. Ft Sq. Ft Renewal Property Type Expiring (c) Expiring (c) Renewing Percentage ------------------------------------------------------------------------------------------------------------------------------- Office 154 1,022,380 646,838 63.3% Industrial 31 585,894 320,798 54.8% Research & Development 5 51,088 13,204 25.8% ------------------------------------------------------------------------------------------------------------------------------- Totals 190 1,659,362 980,840 59.1% ------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------------------------- (a) Includes new and renewed leases during the period (b) Represents either renewed or released space (c) Includes early renewals -------------------------------------------------------------------------------------------------------------------------------
18
------------------------------------------------------------------------------------------------------------------------------------ LEASE EXPIRATION SCHEDULE As of September 30, 2001 TOTAL PORTFOLIO ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Year of Leases Feet Leased % of Total Expiration Expiring Expiring Sq Ft Leased Sq Ft ------------------------------------------------------------------------------------------------------------------------------------ 2001 48 491,060 2.6% 2.6% 2002 171 1,433,749 7.5% 10.0% 2003 174 1,948,718 10.1% 20.2% 2004 185 1,898,329 9.9% 30.1% 2005 202 2,484,552 12.9% 43.0% 2006 196 2,705,226 14.1% 57.1% 2007 and thereafter 304 8,237,790 42.9% 100.0% ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 1,280 19,199,424 100.0% -- ------------------------------------------------------------------------------------------------------------------------------------
OFFICE PORTFOLIO ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Year of Leases Feet Leased % of Total Expiration Expiring Expiring Sq Ft Leased Sq Ft ------------------------------------------------------------------------------------------------------------------------------------ 2001 36 153,687 1.2% 1.2% 2002 142 1,062,494 8.3% 9.5% 2003 142 1,177,346 9.2% 18.6% 2004 144 1,178,558 9.2% 27.8% 2005 176 1,699,118 13.2% 41.0% 2006 154 1,691,172 13.2% 54.2% 2007 and thereafter 247 5,892,948 45.8% 100.0% ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 1,041 12,855,323 100.0% -- ------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/R&D PORTFOLIO ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Year of Leases Feet Leased % of Total Expiration Expiring Expiring Sq Ft Leased Sq Ft ------------------------------------------------------------------------------------------------------------------------------------ 2001 12 337,373 5.3% 5.3% 2002 29 371,255 5.9% 11.2% 2003 32 771,372 12.2% 23.3% 2004 41 719,771 11.3% 34.7% 2005 26 785,434 12.4% 47.1% 2006 42 1,014,054 16.0% 63.0% 2007 and thereafter 57 2,344,842 37.0% 100.0% ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 239 6,344,101 100.0% -- ------------------------------------------------------------------------------------------------------------------------------------
19
------------------------------------------------------------------------------------------------------------------------------------ LEASE EXPIRATION SCHEDULE As of September 30, 2001 LONG ISLAND OFFICE (EXCLUDING OMNI) ----------------------------------------------------------------------------------------------------------------------------------- Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 10 58,954 1.9% 1.9% $22.39 $23.58 2002 30 137,384 4.5% 6.4% $22.63 $25.13 2003 48 324,908 10.7% 17.1% $23.69 $26.03 2004 40 249,801 8.2% 25.3% $23.47 $25.29 2005 48 411,949 13.5% 38.8% $24.07 $26.35 2006 31 142,090 4.7% 43.5% $26.29 $29.72 2007 and thereafter 83 1,723,657 56.5% 100.0% -- -- ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 290 3,048,743 100.0% -- -- -- ------------------------------------------------------------------------------------------------------------------------------------
OMNI ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 1 5,290 0.9% 0.9% $30.83 $34.82 2002 4 53,127 9.3% 10.2% $34.55 $37.91 2003 4 58,018 10.1% 20.3% $30.22 $34.97 2004 4 112,414 19.6% 39.9% $26.14 $34.15 2005 6 59,115 10.3% 50.2% $27.91 $35.18 2006 1 9,749 1.7% 51.9% $35.21 $38.02 2007 and thereafter 10 276,259 48.1% 100.0% -- -- ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 30 573,972 100.0% -- -- -- ------------------------------------------------------------------------------------------------------------------------------------
WESTCHESTER OFFICE ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 4 14,463 0.5% 0.5% $22.07 $22.37 2002 48 430,153 14.3% 14.8% $21.34 $21.92 2003 49 240,857 8.0% 22.8% $22.68 $23.81 2004 32 169,158 5.6% 28.4% $21.37 $22.40 2005 45 387,247 12.9% 41.2% $25.00 $25.40 2006 36 719,583 23.9% 65.1% $22.79 $24.60 2007 and thereafter 44 1,049,933 34.9% 100.0% -- -- ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 258 3,011,394 100.0% -- -- -- ------------------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------------------ (1) Represents annualized straightline rent as of the lease expiration date (2) Represents annualized base rent as of the lease expiration date plus non-recoverable operating expense pass-throughs ------------------------------------------------------------------------------------------------------------------------------------
20
------------------------------------------------------------------------------------------------------------------------------------ LEASE EXPIRATION SCHEDULE As of September 30, 2001 STAMFORD OFFICE ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 9 18,656 1.8% 1.8% $27.67 $21.62 2002 18 88,704 8.5% 10.3% $27.44 $28.72 2003 17 120,969 11.6% 21.9% $31.00 $31.64 2004 21 228,220 21.9% 43.7% $21.81 $22.67 2005 19 121,885 11.7% 55.4% $26.66 $28.47 2006 21 281,437 27.0% 82.4% $25.65 $25.31 2007 and thereafter 16 183,932 17.6% 100.0% -- -- ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 121 1,043,803 100.0% -- -- -- ------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY OFFICE ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 7 38,621 2.1% 2.1% $16.76 $17.14 2002 20 160,092 8.9% 11.0% $20.02 $20.93 2003 17 317,607 17.6% 28.5% $28.05 $27.56 2004 28 200,726 11.1% 39.6% $22.96 $23.78 2005 24 272,316 15.1% 54.7% $23.66 $23.63 2006 16 194,327 10.7% 65.4% $24.23 $25.54 2007 and thereafter 17 625,055 34.6% 100.0% -- -- ------------------------------------------------------------------------------------------------------------------------------------ Total/Weighted Average 129 1,808,744 100.0% -- -- -- ------------------------------------------------------------------------------------------------------------------------------------
NEW YORK CITY OFFICE ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 5 17,703 0.5% 0.5% $28.48 $28.64 2002 22 193,034 5.7% 6.3% $32.47 $33.40 2003 7 114,987 3.4% 9.7% $32.10 $32.89 2004 19 218,239 6.5% 16.1% $36.46 $39.35 2005 34 446,606 13.3% 29.4% $36.05 $37.53 2006 49 343,986 10.2% 39.6% $29.92 $30.69 2007 and thereafter 77 2,034,112 60.4% 100.0% -- -- ----------------------------------------------------------------------------------------------------------------------------------- Total/Weighted Average 213 3,368,667 100.0% -- -- -- -----------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------- (1) Represents annualized straightline rent as of the lease expiration date (2) Represents annualized base rent as of the lease expiration date plus non-recoverable operating expense pass-throughs ------------------------------------------------------------------------------- 21
------------------------------------------------------------------------------------------------------------------------------------ LEASE EXPIRATION SCHEDULE As of September 30, 2001 INDUSTRIAL ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 7 74,427 1.5% 1.5% $5.75 $6.17 2002 26 252,635 5.0% 6.4% $6.49 $7.30 2003 28 733,434 14.4% 20.8% $5.35 $6.26 2004 32 620,553 12.2% 33.0% $6.24 $7.31 2005 22 427,994 8.4% 41.4% $5.93 $7.97 2006 37 933,793 18.3% 59.7% $6.42 $7.91 2007 and thereafter 44 2,056,442 40.3% 100.0% -- -- ------------------------------------------------------------------------------------------------------------------------------------ Total / Weighted Average 196 5,099,278 100.0% -- -- -- ------------------------------------------------------------------------------------------------------------------------------------
RESEARCH & DEVELOPMENT ------------------------------------------------------------------------------------------------------------------------------------ Number of Square % of Total Cumulative Expiring Expiring Year of Leases Feet Leased % of Total GAAP Cash Expiration Expiring Expiring Sq Ft Leased Sq Ft Rent (1) Rent (2) ------------------------------------------------------------------------------------------------------------------------------------ 2001 5 262,946 21.1% 21.1% $ 5.59 $6.78 2002 3 118,620 9.5% 30.7% $10.19 $11.82 2003 4 37,938 3.0% 33.7% $ 9.20 $10.15 2004 9 99,218 8.0% 41.7% $13.86 $15.01 2005 4 357,440 28.7% 70.4% $ 8.70 $10.78 2006 5 80,261 6.4% 76.8% $18.06 $20.83 2007 and thereafter 13 288,400 23.2% 100.0% -- -- ------------------------------------------------------------------------------------------------------------------------------------ Total / Weighted Average 43 1,244,823 100.0% -- -- -- ------------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------- (1) Represents annualized straightline rent as of the lease expiration date (2) Represents annualized base rent as of the lease expiration date plus non-recoverable operating expense pass-throughs -------------------------------------------------------------------------------- 22
------------------------------------------------------------------------------------------------------------------------------------ LEASE EXPIRATION COMPARISON September 30, 2001 EXPIRING RENTS VS. MARKET ASKING RENTS [GRAPHICS OMITTED] SUBURBAN OFFICE PARK EXPIRING RENT (1) MARKET RENT (2) INCREASE ----------------- --------------- -------- Long Island 24.85 30.04 21% Westchester 22.77 29.13 28% New Jersey 24.1 30.56 27%
CBD OFFICE PARK EXPIRING RENT (1) MARKET RENT (2) INCREASE ----------------- --------------- -------- Connecticut 25.76 37.73 46% New York City 34.95 59.76 71%
Source: Cushman & Wakefield (1) Represents average rents for leases expiring over the next 5.25 years (2) Average Class A asking rents as provided by Cushman & Wakefield. There can be no assurance the Company's properties can achieve such rents. 23 -------------------------------------------------------------------------------- LEASE DISTRIBUTION As of September 30, 2001
OFFICE PORTFOLIO --------------------------------------------------------------------------------------------------------------------------------- Occupied % of Occupied Contract % of Weighted Avg Square Feet Under Lease Sq Ft Sq Ft Rent (a) Contract Rent Maturity (Years) --------------------------------------------------------------------------------------------------------------------------------- 2,500 or Less 453,521 3.5% $ 10,592,371 3.2% 3.5 2,501 - 5,000 798,180 6.2% 18,740,293 5.8% 4.0 5,001 - 10,000 1,376,737 10.7% 35,577,529 11.0% 4.2 10,001 - 20,000 2,187,646 17.0% 54,830,742 16.9% 4.9 20,001 - 40,000 2,769,815 21.5% 78,443,356 24.6% 5.1 40,001 - 60,000 1,232,039 9.6% 30,354,990 9.3% 7.2 60,001 - 100,000 1,043,378 8.1% 24,670,668 7.6% 7.2 100,001 or Greater 2,994,007 23.3% 69,826,809 21.5% 9.8 --------------------------------------------------------------------------------------------------------------------------------- Total 12,855,323 100.0% $323,036,757 100.0% 6.3 ---------------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL PORTFOLIO --------------------------------------------------------------------------------------------------------------------------------- Occupied % of Occupied Contract % of Weighted Avg Square Feet Under Lease Sq Ft Sq Ft Rent (a) Contract Rent Maturity (Years) --------------------------------------------------------------------------------------------------------------------------------- 10,000 or Less 620,401 9.8% $ 4,905,082 11.6% 3.8 10,001 - 20,000 626,796 9.9% 5,003,039 11.8% 3.7 20,001 - 40,000 1,107,856 17.5% 7,617,165 18.0% 3.6 40,001 - 60,000 823,203 13.0% 6,621,439 15.6% 4.3 60,001 - 100,000 763,157 12.0% 5,534,441 13.1% 5.8 100,001 or Greater 2,402,688 37.9% 12,629,297 29.8% 6.2 --------------------------------------------------------------------------------------------------------------------------------- Total 6,344,101 100.0% $42,310,462 100.0% 5.0 ---------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------- (a) Represents contract rent in place for the 12 month period October 1, 2001 through September 30, 2002. -------------------------------------------------------------------------------- 24 -------------------------------------------------------------------------------- NON-INCREMENTAL REVENUE GENERATING CAPITAL EXPENDITURES, TENANT IMPROVEMENT COSTS AND LEASING COMMISSIONS The following table summarizes the expenditures incurred for capital expenditures for the entire portfolio and tenant improvements and leasing commissions for space leased at the Company's office and industrial properties for the nine month period ended September 30, 2001 and the historical average of such capital expenditures, tenant improvements and leasing commissions for the years 1997 through 2000.
------------------------------------------------------------------------------------------------------------------------------------ NON-INCREMENTAL REVENUE GENERATING CAPITAL EXPENDITURES ------------------------------------------------------------------------------------------------------------------------------------ 1997-2000 1997 1998 1999 2000 average 2001 -------------- -------------- --------------- -------------- -------------- ------------- Suburban Office Properties Total $1,108,675 $2,004,976 $2,298,899 $3,289,116 $2,175,417 $2,623,584 Per Square Foot 0.22 0.23 0.23 0.33 0.25 0.26 CBD Office Properties Total N/A N/A N/A $946,718 $946,718 $1,209,481 Per Square Foot N/A N/A N/A 0.38 0.38 0.34 Industrial Properties Total $733,233 $1,205,266 $1,048,688 $813,431 $950,155 $500,698 Per Square Foot 0.15 0.12 0.11 0.11 0.12 0.08
------------------------------------------------------------------------------------------------------------------------------------ NON-INCREMENTAL REVENUE GENERATING TENANT IMPROVEMENTS AND LEASING COMMISSIONS ------------------------------------------------------------------------------------------------------------------------------------ 1997 1998 1999 2000 --------------- -------------- -------------- --------------- Long Island Office Properties Tenant Improvements $ 784,044 $1,140,251 $1,009,357 $2,853,706 Per Square Foot Improved 7.00 3.98 4.73 6.99 Leasing Commissions $ 415,822 $ 418,191 $ 551,762 $2,208,604 Per Square Foot Leased 4.83 1.46 2.59 4.96 --------------- -------------- -------------- --------------- Total Per Square Foot $ 11.83 $ 5.44 $ 7.32 $ 11.95 =============== ============== ============== =============== Westchester Office Properties Tenant Improvements $1,211,665 $ 711,160 $1,316,611 $1,860,027 Per Square Foot Improved 8.9 4.45 5.62 5.72 Leasing Commissions $ 366,257 $ 286,150 $ 457,730 $ 412,226 Per Square Foot Leased 2.69 1.79 1.96 3.00 --------------- -------------- -------------- --------------- Total Per Square Foot $ 11.59 $ 6.24 $ 7.58 $ 8.72 =============== ============== ============== =============== Connecticut Office Properties Tenant Improvements $1,022,421 $ 202,880 $ 179,043 $ 385,531 Per Square Foot Improved 13.39 5.92 4.88 4.19 Leasing Commissions $ 256,615 $ 151,063 $ 110,252 $ 453,435 Per Square Foot Leased 3.36 4.41 3.00 4.92 --------------- -------------- -------------- --------------- Total Per Square Foot $ 16.75 $ 10.33 $ 7.88 $ 9.11 =============== ============== ============== =============== New Jersey Office Properties Tenant Improvements N/A $ 654,877 $ 454,054 $1,580,323 Per Square Foot Improved N/A 3.78 2.29 6.71 Leasing Commissions N/A $ 396,127 $ 787,065 $1,031,950 Per Square Foot Leased N/A 2.08 3.96 4.44 --------------- -------------- -------------- --------------- Total Per Square Foot N/A $ 5.86 $ 6.25 $ 11.15 =============== ============== ============== =============== New York City Office Properties Tenant Improvements N/A N/A N/A $ 65,267 Per Square Foot Improved N/A N/A N/A 1.79 Leasing Commissions N/A N/A N/A $ 418,185 Per Square Foot Leased N/A N/A N/A 11.50 --------------- -------------- -------------- --------------- Total Per Square Foot N/A N/A N/A $ 13.29 =============== ============== ============== =============== Industrial Properties Tenant Improvements $ 230,466 $ 283,842 $ 375,646 $ 650,216 Per Square Foot Improved 0.55 0.76 0.25 0.95 Leasing Commissions $ 81,013 $ 200,154 $ 835,108 $ 436,506 Per Square Foot Leased 0.19 0.44 0.56 0.64 --------------- -------------- -------------- --------------- Total Per Square Foot $ 0.75 $ 1.20 $ 0.81 $ 1.59 =============== ============== ============== =============== 1997-2000 average 2001 New Renewal -------------- -------------- --------------- -------------- Long Island Office Properties Tenant Improvements $1,466,840 $ 702,596 $ 544,453 $158,143 Per Square Foot Improved 5.68 3.87 14.91 1.09 Leasing Commissions $ 898,595 $ 699,507 $ 150,702 $548,805 Per Square Foot Leased 3.46 3.86 4.13 3.79 ------------- -------------- --------------- -------------- Total Per Square Foot $ 9.14 $ 7.73 $ 19.04 $ 4.88 ============= ============== =============== ============== Westchester Office Properties Tenant Improvements $1,274,866 $1,683,578 $1,137,880 $545,698 Per Square Foot Improved 6.17 7.50 8.18 3.72 Leasing Commissions $ 380,591 $ 39,295 $ 39,295 $ 0 Per Square Foot Leased 2.36 0.14 0.28 -- ------------- -------------- --------------- -------------- Total Per Square Foot $ 8.53 $ 7.64 $ 8.46 $ 3.72 ============= ============== =============== ============== Connecticut Office Properties Tenant Improvements $ 447,469 $ 213,909 $ 133,543 $ 80,366 Per Square Foot Improved 7.10 2.38 5.63 1.22 Leasing Commissions $ 242,841 $ 182,516 $ 118,463 $ 64,053 Per Square Foot Leased 3.92 2.03 4.99 0.97 ------------- -------------- --------------- -------------- Total Per Square Foot $ 11.02 $ 4.41 $ 10.62 $ 2.19 ============= ============== =============== ============== New Jersey Office Properties Tenant Improvements $ 896,418 $1,140,108 $1,102,974 $ 37,134 Per Square Foot Improved 4.26 2.93 3.54 0.48 Leasing Commissions $ 738,381 $1,591,484 $1,283,112 $308,372 Per Square Foot Leased 3.49 4.09 4.12 3.98 ------------- -------------- --------------- -------------- Total Per Square Foot $ 7.75 $ 7.02 $ 7.66 $ 4.46 ============= ============== =============== ============== New York City Office Properties Tenant Improvements $ 65,267 $ 738,800 $ 738,800 $ 0 Per Square Foot Improved 1.79 16.87 16.87 -- Leasing Commissions $ 418,185 $1,026,398 $1,026,398 $ 0 Per Square Foot Leased 11.50 23.44 23.44 -- ------------- -------------- --------------- -------------- Total Per Square Foot $ 13.29 $ 40.31 $ 40.31 $ 0.00 ============= ============== =============== ============== Industrial Properties Tenant Improvements $ 385,043 $ 34,650 $ 34,650 $ 0 Per Square Foot Improved 0.63 0.08 0.22 -- Leasing Commissions $ 388,195 $ 50,055 $ 50,055 $ 0 Per Square Foot Leased 0.46 0.11 0.31 -- ------------- -------------- --------------- -------------- Total Per Square Foot $ 1.09 0.19 0.53 $ 0.00 ============= ============== =============== ==============
25 CLASS A OFFICE STATISTICS [Graphics Omitted]
LONG ISLAND 1997 1998 1999 2000 3Q01 Average Asking Rental Rates $26.14 $27.23 $27.69 $28.86 $30.04 Overall Vacancy 9.70% 6.70% 6.50% 8.40% 10.30% Direct Vacancy 8.70% 6.10% 5.60% 6.30% 7.20% WESTCHESTER 1997 1998 1999 2000 3Q01 Average Asking Rental Rates $25.14 $26.67 $27.23 $29.62 $29.48 Overall Vacancy 15.60% 19.20% 16.30% 12.00% 17.80% Direct Vacancy 13.30% 16.40% 15.00% 10.70% 13.80% SOUTHERN CONNECTICUT 1997 1998 1999 2000 3Q01 Average Asking Rental Rates $28.96 $32.22 $31.78 $44.41 $37.73 Overall Vacancy 5.70% 4.20% 4.70% 8.10% 11.80% Direct Vacancy 4.20% 3.60% 4.00% 7.20% 7.80% NORTHERN NEW JERSEY 1997 1998 1999 2000 3Q01 Average Asking Rental Rates $25.38 $27.42 $28.52 $29.66 $30.56 Overall Vacancy 7.30% 7.50% 7.10% 9.90% 11.60% Direct Vacancy 4.70% 5.30% 4.60% 6.50% 7.50%
Source: Cushman & Wakefield 26 NEW YORK CITY CLASS A OFFICE STATISTICS [GRAPHICS OMITTED]
AVERAGE ASKING RENTS 1997 1998 1999 2000 3Q01 Financial East $29.77 $40.21 $37.64 $52.90 $48.15 Midtown West Side $33.10 $43.36 $48.28 $60.89 $61.58 Midtown East Side $39.33 $47.85 $51.18 $61.46 $60.55 6th Ave./Rockefeller Center $43.62 $51.33 $53.12 $65.91 $64.63
Source: Cushman & Wakefield Breakdown of New York City Revenue: Midtown West Side 38% Midtown East Side 27% 6th Ave./Rockefeller Center 16% Financial East 12% 27 -------------------------------------------------------------------------------- NEW YORK CITY CLASS A OFFICE STATISTICS [GRAPHICS OMITTED]
FINANCIAL EAST 1997 1998 1999 2000 3Q01 Overall Vacancy 8.9% 7.3% 4.1% 2.1% 5.0% Direct Vacancy 8.2% 6.6% 3.4% 1.4% 1.4% MIDTOWN WEST 1997 1998 1999 2000 3Q01 Overall Vacancy 6.9% 4.3% 6.0% 2.7% 6.0% Direct Vacancy 3.7% 3.3% 4.6% 2.4% 3.8% MIDTOWN EAST 1997 1998 1999 2000 3Q01 Overall Vacancy 7.2% 8.0% 5.0% 2.6% 6.3% Direct Vacancy 5.6% 6.0% 3.8% 1.9% 3.1% 6TH AVE/ROCK CTR 1997 1998 1999 2000 3Q01 Overall Vacancy 4.7% 5.0% 2.6% 1.2% 3.9% Direct Vacancy 2.7% 2.2% 1.6% 0.9% 1.8%
Source: Cushman & Wakefield Breakdown of New York City Revenue: Midtown West Side 38% Midtown East Side 27% 6th Ave./Rockefeller Center 16% Financial East 12% 28 -------------------------------------------------------------------------------- Long Island Submarket Class A Office Statistics [Graphics Omitted]
AVERAGE ASKING RENTS 1997 1998 1999 2000 3Q01 Central Nassau County $28.79 $29.10 $29.93 $31.15 $31.67 Western Suffolk County $26.55 $26.22 $27.34 $28.22 $30.27 Eastern Nassau County $25.22 $27.49 $26.23 $28.75 $28.94 DIRECT VACANCY RATES 1997 1998 1999 2000 3Q01 Central Nassau County 7.5% 5.1% 5.1% 4.7% 4.2% Western Suffolk County 7.7% 7.7% 11.6% 15.4% 16.8% Eastern Nassau County 6.4% 4.9% 0.9% 1.4% 2.0%
Source: Cushman & Wakefield Breadown of Long Island office revenue: Central Nassau 50% Western Suffolk 32% Eastern Nassau 7% Other 11% 29 -------------------------------------------------------------------------------- WESTCHESTER SUBMARKETS CLASS A OFFICE STATISTICS [GRAPHICS OMITTED]
AVERAGE ASKING RENTS 1997 1998 1999 2000 3Q01 Central $22.39 $22.91 $27.07 $28.49 $28.04 Tarrytown/Western $24.43 $24.66 $27.30 $27.03 $28.96 Eastern $26.53 $29.35 $27.70 $29.65 $30.75 White Plains CBD $25.09 $26.84 $27.44 $30.62 $30.26 DIRECT VACANCY RATES 1997 1998 1999 2000 3Q01 Central 5.7% 12.3% 13.5% 12.0% 21.3% Tarrytown / Western 7.9% 7.8% 8.0% 6.0% 11.2% Eastern 8.6% 12.2% 10.1% 8.1% 7.2% White Plains CBD 25.7% 22.7% 22.6% 11.5% 15.0%
Source: Cushman & Wakefield Breakdown of Westchester office revenue: Central 30% Tarrytown / Western 27% White Plains 21% Eastern 16% Other 7% Note: The 21.3% vacancy in Central Westchester is impacted by IBM selling a 383,000 owner occupied building. The location of this building is not easily accessible to major thoroughfares and employee and employee bedroom communities. Excluding this building the vacancy rate is 17.3% 30 -------------------------------------------------------------------------------- NEW JERSEY SUBMARKETS CLASS A OFFICE STATISTICS [GRAPHICS OMITTED]
AVERAGE ASKING RENTS 1997 1998 1999 2000 3Q01 Essex County $26.47 $27.74 $28.78 $28.90 $30.36 Bergen County $26.02 $27.37 $28.07 $29.41 $29.66 Mercer County $23.01 $24.49 $27.46 $30.32 $29.42 DIRECT VACANCY 1997 1998 1999 2000 3Q01 Essex County 4.7% 3.3% 6.0% 9.6% 6.2% Bergen County 7.8% 6.8% 5.3% 5.1% 9.9% Mercer County 2.5% 1.5% 5.2% 6.3% 4.6%
Source: Cushman & Wakefield Breakdown of New Jersey office revenue: Essex County 46% Bergen County 10% Mercer County 6% Other 38% 31
--------------------------------------------------------------------------------------------------------------------------------- VALUE CREATION PIPELINE As of September 30, 2001 --------------------------------------------------------------------------------------------------------------------------------- Square Feet/ Investment Stage / Property Acres To Date --------------------------------------------------------------------------------------------------------------------------------- PROJECTS IN STABILIZATION ------------------------- Melville Expressway Corporate Center, Melville, NY ( Phase I) 277,500 --------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS IN STABILIZATION 277,500 $44,143,409 --------------------------------------------------------------------------------------------------------------------------------- PROJECTS UNDER DEVELOPMENT OR REPOSITIONING ------------------------------------------- 103 JFK Expressway, Short Hills, NJ 129,508 400 Moreland Road, Commack, NY 56,875 --------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS UNDER DEVELOPMENT OR REPOSITIONING 186,383 $26,621,818 --------------------------------------------------------------------------------------------------------------------------------- PROJECTS IN PLANNING -------------------- Melville Square Corporate Center II, Melville, NY 255,000 University Square , Princeton, NJ 315,000 Melville Expressway Corporate Center, Melville, NY ( Phase II) 277,500 Reckson Executive Park, Rye Brook, NY 345,000 AIP 2001, Islip, NY 71,000 Landmark 7, Stamford, CT 61,000 Giralda Farms , Morris County, NJ 430,000 --------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS IN PLANNING 1,754,500 $63,400,123 --------------------------------------------------------------------------------------------------------------------------------- LAND ---- 70 Andrews Road, Hicksville, NY 3.8 Old Willets Path, Hauppauge, NY 2.0 Eagle Rock 3, East Hanover, NJ 15.0 AIP Recapture, Islip, NY 4.2 AIP, Islip NY 3.8 AIP, Islip NY 2.0 East Patchogue, East Patchogue, NY 23.0 40 Cragwood, South Plainfield, NJ 7.0 Giralda Farms , Chatham County, NJ 113.0 --------------------------------------------------------------------------------------------------------------------------------- TOTAL LAND 173.8 $11,241,210 --------------------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------------------- TOTAL UNREALIZED PIPELINE $145,406,560 --------------------------------------------------------------------------------------------------------------------------------- Investments that reached realization during 2001 ------------------------------------------------ 50 Marcus Dr 163,762 sf 100 Grasslands 47,690 sf --------------------------------------------------------------------------------------------------------------------------------- TOTAL REALIZED VALUE CREATION PROJECTS 7,684,640 $1,002,911,258 --------------------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------------------- TOTAL VALUE CREATION PIPELINE $1,148,317,818 --------------------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------- VALUE CREATION PIPELINE As of September 30, 2001 --------------------------------------------------------------------------------------------------------------------------------- Anticipated Current % Stage / Property Total Investment (a) Leased ---------------------------------------------------------------------------------------------------------------------------------- PROJECTS IN STABILIZATION ------------------------- Melville Expressway Corporate Center, Melville, NY ( Phase I) $43,446,000 ---------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS IN STABILIZATION $43,446,000 31.0% ---------------------------------------------------------------------------------------------------------------------------------- PROJECTS UNDER DEVELOPMENT OR REPOSITIONING ------------------------------------------- 103 JFK Expressway, Short Hills, NJ 129,508 $30,000,000 400 Moreland Road, Commack, NY $2,967,000 ---------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS UNDER DEVELOPMENT OR REPOSITIONING $32,967,000 0.0% ---------------------------------------------------------------------------------------------------------------------------------- PROJECTS IN PLANNING -------------------- Melville Square Corporate Center II, Melville, NY $33,660,000 University Square , Princeton, NJ $50,397,000 Melville Expressway Corporate Center, Melville, NY ( Phase II) $49,290,000 Reckson Executive Park, Rye Brook, NY $55,799,000 AIP 2001, Islip, NY $5,692,000 Landmark 7, Stamford, CT $13,208,000 Giralda Farms , Morris County, NJ $80,091,000 ---------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS IN PLANNING $288,137,000 0.0% ---------------------------------------------------------------------------------------------------------------------------------- LAND ---- 70 Andrews Road, Hicksville, NY $3,309,000 - Old Willets Path, Hauppauge, NY $2,995,000 - Eagle Rock 3, East Hanover, NJ $17,625,000 - AIP Recapture, Islip, NY $0 - AIP, Islip NY $2,200,000 - AIP, Islip NY $1,400,000 - East Patchogue, East Patchogue, NY $0 - 40 Cragwood, South Plainfield, NJ $0 - Giralda Farms , Chatham County, NJ $130,000,000 - ---------------------------------------------------------------------------------------------------------------------------------- TOTAL LAND $157,529,000 ---------------------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------------- TOTAL UNREALIZED PIPELINE $522,079,000 ---------------------------------------------------------------------------------------------------------------------------------- Investments that reached realization during 2001 ------------------------------------------------ 50 Marcus Dr 163,762 sf 100 Grasslands 47,690 sf ---------------------------------------------------------------------------------------------------------------------------------- TOTAL REALIZED VALUE CREATION PROJECTS $1,002,911,258 97.1% ---------------------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------------- TOTAL VALUE CREATION PIPELINE $1,524,990,258 ---------------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------- VALUE CREATION PIPELINE As of September 30, 2001 --------------------------------------------------------------------------------------------------------------------------------- Estimated Anticipated Stage / Property Stabilization Date (a) Stabilized Return (a) ----------------------------------------------------------------------------------------------------------------------------------- PROJECTS IN STABILIZATION ------------------------- Melville Expressway Corporate Center, Melville, NY ( Phase I) Q3 2002 ----------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS IN STABILIZATION 12.0% ----------------------------------------------------------------------------------------------------------------------------------- PROJECTS UNDER DEVELOPMENT OR REPOSITIONING ------------------------------------------- 103 JFK Expressway, Short Hills, NJ 129,508 Q4 2002 400 Moreland Road, Commack, NY Q4 2002 ----------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS UNDER DEVELOPMENT OR REPOSITIONING 10.2% ----------------------------------------------------------------------------------------------------------------------------------- PROJECTS IN PLANNING -------------------- Melville Square Corporate Center II, Melville, NY Q3 2003 University Square , Princeton, NJ Q4 2003 Melville Expressway Corporate Center, Melville, NY ( Phase II) Q4 2003 Reckson Executive Park, Rye Brook, NY Q4 2003 AIP 2001, Islip, NY Q4 2002 Landmark 7, Stamford, CT Q1 2003 Giralda Farms , Morris County, NJ Q1 2004 ----------------------------------------------------------------------------------------------------------------------------------- TOTAL PROJECTS IN PLANNING 12.0% ----------------------------------------------------------------------------------------------------------------------------------- LAND ---- 70 Andrews Road, Hicksville, NY - Old Willets Path, Hauppauge, NY - Eagle Rock 3, East Hanover, NJ - AIP Recapture, Islip, NY - AIP, Islip NY - AIP, Islip NY - East Patchogue, East Patchogue, NY - 40 Cragwood, South Plainfield, NJ - Giralda Farms , Chatham County, NJ - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL LAND 11.3% ----------------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------------- TOTAL UNREALIZED PIPELINE 11.6% ----------------------------------------------------------------------------------------------------------------------------------- Investments that reached realization during 2001 ------------------------------------------------ 50 Marcus Dr 163,762 sf 100 Grasslands 47,690 sf ----------------------------------------------------------------------------------------------------------------------------------- TOTAL REALIZED VALUE CREATION PROJECTS 12.6% ----------------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------------- TOTAL VALUE CREATION PIPELINE ----------------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------------- (a) Forward looking statement based upon management's estimates. Actual results may differ materially. ---------------------------------------------------------------------------------------------------------------------------------
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