StockSelector.com
  Research, Select, & Monitor Friday, May 24, 2019 11:45:40 AM ET  
Trade Ideas The Market Industries Stocks Portfolio

 
Ticker Lookup
Brandywine Realty Trust$15.00$.04.27%

  Quote | Ranking | Chart | Valuations | Sentiment | Industry | News | Earnings | Analysts | More...

Your Target?

 Brandywine Realty Trust Announces Significant Investment Activity, Third Quarter 2018 Results, Narrows 2018 Guidance and Provides Initial 2019 Guidance
   Wednesday, October 17, 2018 5:26:00 PM ET

PHILADELPHIA, Oct. 17, 2018 (GLOBE NEWSWIRE) -- Brandywine Realty Trust (NYSE:BDN) today reported its financial and operating results for the three and nine-month periods ended September 30, 2018, revised full year 2018 guidance and introduced 2019 earnings guidance.

Management Comments

“In addition to making excellent progress on our 2018 business plan, we also are announcing two significant transactions that further accelerate our growth,” stated Gerard H. Sweeney, President and Chief Executive Officer of Brandywine Realty Trust. “These transactions achieve our goals of increasing our revenue contribution from Austin, increasing our return on invested capital and creating earnings momentum.  Both of these transactions will close in the fourth quarter.  Given the continued progress of our 2018 business plan, we are narrowing our 2018 FFO guidance range from $1.35 to $1.41 per share to $1.36 to $1.40 per share.  We are also introducing our 2019 FFO guidance range of $1.37 to $1.47 per share which includes the impact of the announced transaction activity and a $0.03 per share reduction due to a new lease accounting standard.  Our 2019 guidance at the midpoint represents a comparable 5% annual FFO growth rate.”

Third Quarter Highlights

Financial Results

  • Net loss available to common shareholders; ($43.0) million, or ($0.24) per diluted share, which includes an impairment charge totaling ($56.9) million, or ($0.32) per diluted share.
  • Funds from Operations (FFO); $63.2 million, or $0.35 per diluted share.

Portfolio Results

  • Core portfolio was 93.0% occupied and 95.1% leased.
  • Signed 526,000 square feet of new and renewal leases.
  • Achieved 75% tenant retention ratio.
  • Rental rate mark-to-market increased 11.4% on a GAAP basis and increased 3.0% on a cash basis.

2018 Business Plan Revisions

  • 2018 Disposition Target Increase:  85% of Northern Virginia Joint Venture, or $265.2 million.
  • 2018 Acquisition Target Increase:  50% of Austin Investment, or $268.5 million.
  • Speculative Review Target:  Decrease from $26.3 million to $25.3 million.
  • GAAP Same-Store Growth Rate:  Adjust from (1)-1% to (1.5)-0%.
  • GAAP Market-to-Market:  Increase from 8-10% to 13-14%.
  • Estimated Changes to 2018 Net Income (In $millions):
           Gain and Promote on Austin Portfolio Transaction$127.3   
 Impairment on Sale of Northern Virginia Assets    (56.9)                                                                                                                                                                                                              
 Net Increase to Net Income $70.4   
       
 The net increase to 2018 net income represents $0.39 per diluted share and will not be included in FFO.


2019 Business Plan and Guidance Introduced

  • Net income:  $0.36 to $0.46 per diluted share
  • FFO:  $1.37 to $1.47 per diluted share
  • Same Store Growth Range: 1-3% cash and 0-2% GAAP
  • Rental Rate Mark-to-Market Range:  8-10% GAAP and 2-4% cash
  • Effective January 1, 2019, we will implement a new lease accounting standard that will modify our accounting for leases, ground leases and the capitalization of lease related pursuit costs.  We estimate that the implementation of the new standard will reduce earnings by $4.6 million.  Our 2019 guidance reflects the $4.6 million, or $0.03 per diluted share, reduction in our net income available to shareholders and FFO to reflect the implementation of the new accounting standard.

Transaction Activity



Austin Investment

  • On October 17, 2018, we entered into an agreement to acquire our partner’s entire 50% interest in the 12 remaining buildings within the DRA Austin real estate venture (“Austin Portfolio”) containing 1,570,123 square feet, located in Austin, Texas, valuing the portfolio at $537.0 million, or $342 per square foot.  The Austin Portfolio is currently encumbered by $246.5 million of mortgage indebtedness that we intend to pay-off at closing or during the first quarter of 2019.  Upon closing, the joint venture generated a 27% internal rate of return to our shareholders.  We anticipate the transaction closing during the fourth quarter 2018 and will fund the acquisition using cash-on-hand, proceeds from the anticipated Northern Virginia Joint Venture and our unsecured line of credit.

Dispositions

Northern Virginia Joint Venture

  • On October 16, 2018, we entered into an agreement with the Rockpoint Group to sell a portfolio of 8 properties (the “Portfolio”) containing an aggregate of 1,293,197 square feet, located in the Northern Virginia, for a sales price of $312.0 million.  We retained a 15% equity interest in the Portfolio through an unconsolidated real estate venture (the “JV”).  To partially fund the acquisition, the JV will secure mortgage financing.  As of September 30, 2018, the Portfolio was classified as held for sale.

National Training Center

  • On May 18, 2018, Subaru exercised its option to purchase the National Training Center in Camden, New Jersey.  During the third quarter 2018, we placed the National Training Center into service and Subaru took occupancy.  Subaru will purchase the property during the fourth quarter 2018.  At closing, we estimate the gross purchase price will approximate $47.7 million, we expect to record a gain totaling approximately $3.5 million, and receive proceeds of approximately $45.2 million.

Finance Activity

  • As previously disclosed, on July 17, 2018, we amended our revolving credit facility to extend the maturity date from May 15, 2019 to July 15, 2022 with two six-month extensions.  In addition, we lowered our interest rate borrowing margin by 10 basis points and reduced our financial covenant requirements.
  • On August 1, 2018, the MAP Venture refinanced its mortgage loan which reduced the interest rate to LIBOR + 2.45% capped at a total maximum interest rate of 6.0%, and extended the maturity date to August 1, 2023.
  • We have no outstanding balance on our $600.0 million unsecured revolving credit facility as of September 30, 2018.
  • We have $70.0 million of cash and cash equivalents on-hand as of September 30, 2018.

Results for the Three and Nine-Month Periods Ended September 30, 2018

Net loss allocated to common shares totaled ($43.0) million or ($0.24) per diluted share in the third quarter of 2018 compared to a net income of $18.8 million or $0.11 per diluted share in the third quarter of 2017.  The 2018 results include an impairment charge totaling ($56.9) million, or ($0.32) per diluted share.

FFO available to common shares and units in the third quarter of 2018 totaled $63.2 million or $0.35 per diluted share versus $61.9 million or $0.35 per diluted share in the third quarter of 2017.  Our third quarter 2018 payout ratio ($0.18 common share distribution / $0.35 FFO per diluted share) was 51.4%. 

Net income allocated to common shares totaled $14.1 million or $0.08 per diluted share for the first nine months of 2018 compared to net income of $42.2 million or $0.24 per diluted share in the first nine months of 2017.  The 2018 results include an impairment charge totaling ($56.9) million, or ($0.32) per diluted share.

Our FFO available to common shares and units for the first nine months of 2018 totaled $183.4 million, or $1.01 per diluted share compared to FFO available to common shares and units of $175.5 million, or $0.99 per diluted share, for the first nine months of 2017.  Our first nine months 2018 FFO payout ratio ($0.54 common share distribution / $1.01 FFO per diluted share) was 53.5%.

Operating and Leasing Activity

In the third quarter of 2018, our Net Operating Income (NOI) excluding termination revenues and other income items increased 3.4% on a GAAP basis and increased 13.7% on a cash basis for our 76 same store properties, which were 93.1% and 92.4% occupied on September 30, 2018 and September 30, 2017, respectively.

We leased approximately 526,000 square feet and commenced occupancy on 336,000 square feet during the third quarter of 2018.  The third quarter occupancy activity includes 140,000 square feet of renewals, 121,000 square feet of new leases and 75,000 square feet of tenant expansions.  We have an additional 302,000 square feet of executed new leasing scheduled to commence subsequent to September 30, 2018.

We achieved a 75% tenant retention ratio in our core portfolio with net absorption of 50,000 square feet during the third quarter of 2018.  Third quarter rental rate growth increased 11.4% as our renewal rental rates increased 6.3% and our new lease/expansion rental rates increased 17.1%, all on a GAAP basis.

At September 30, 2018, our core portfolio of 78 properties comprising 14.3 million square feet was 93.0% occupied and we are now 95.1% leased (reflecting new leases commencing after September 30, 2018).

Distributions

On September 11, 2018, our Board of Trustees declared a quarterly dividend distribution of $0.18 per common share that was paid on October 18, 2018 to shareholders of record as of October 4, 2018

2018 Earnings and FFO Guidance

Based on current plans and assumptions and subject to the risks and uncertainties more fully described in our Securities and Exchange Commission filings, we are adjusting our previously issued 2018 net income guidance of $0.29 to $0.35 per diluted share to $0.76 to $0.80 per diluted share and adjusting our previously issued 2018 FFO guidance of $1.35 to $1.41 per diluted share to $1.36 to $1.40 per diluted share.  This guidance is provided for informational purposes and is subject to change.  The following is a reconciliation of the calculation of 2018 FFO and earnings per diluted share:

Guidance for 2018    Range 
   Less:  Impairment & estimated net (gain) loss on sale of real estate transactions and promote income$0.69 to $0.73 
   Plus:  Real estate depreciation, amortization(0.39)  (0.39)                                                                                                                                                                                                                   
   1.06  1.06 
     
            FFO per diluted share$1.36 to $1.40 
     

Our 2018 FFO key assumptions to include:

  • Core Occupancy improving to a range of 94-95% by year-end 2018 and 95-96% leased;
  • 13-14% GAAP increase in overall lease rates during 2018 with a resulting (1.5)-0% (decrease)/increase in 2018 same store GAAP NOI;
  • (2)-2% cash (decrease)/increase in overall lease rates during 2018 with a resulting 1-3% increase in 2018 same store cash NOI;
  • Speculative Revenue Target:  $25.3 million, 96% achieved;
  • $0.18 per share quarterly dividend;
  • Acquisition Activity:  Austin Investment, 50% of $537.0 million, or $268.5 million;
  • Sales Activity:  $366.0 million, represents sales of evo and Northern Virginia Joint Venture;
  • One development start; and
  • Annual earnings and FFO per diluted share based on 182.0 million fully diluted weighted average common shares.

2019 Earnings and FFO Guidance

Based on current plans and assumptions and subject to the risks and uncertainties more fully described in our Securities and Exchange Commission filings, we are introducing our 2019 net income guidance of $0.36 - $0.46 per diluted share and 2019 FFO guidance of $1.37 - $1.47 per diluted share.  This guidance is provided for informational purposes and is subject to change.  The following is a reconciliation of the calculation of 2019 FFO and earnings per diluted share:

Guidance for 2019 Range 
     Earnings per diluted share allocated to common shareholders$0.36 to $0.46                                                                                                                                                                                 
     Plus: real estate depreciation, amortization1.01    1.01 
     FFO per diluted share$ 1.37 to $ 1.47 
    


Our 2019 FFO key assumptions to include:

  • Core Occupancy improving to a range of 94-95% by year-end 2019 and 95-96% leased;
  • 8-10% GAAP increase in overall lease rates;
  • 2-4% cash increase in overall lease rates;
  • 0-2% increase in 2019 same store GAAP NOI;
  • 1-3% increase in 2019 same store cash NOI;
  • Speculative Revenue Target:  $31.0 million, 65% achieved;
  • Change in Lease Accounting Treatment:  $4.6 million, or $0.03 per diluted share;
  • $0.18 per share quarterly dividend;
  • Acquisition Activity:  none
  • Sales Activity:  none;
  • One development start; and
  • Annual earnings and FFO per diluted share based on 182.0 million fully diluted weighted average common shares.

About Brandywine Realty Trust

Brandywine Realty Trust (NYSE: BDN) is one of the largest, publicly traded, full-service, integrated real estate companies in the United States with a core focus in the Philadelphia, Washington, D.C., and Austin markets.  Organized as a real estate investment trust (REIT), we own, develop, lease and manage an urban, town center and transit-oriented portfolio comprising 184 properties and 25.3 million square feet as of September 30, 2018, which excludes assets held for sale.  Our purpose is to shape, connect and inspire the world around us through our expertise, the relationships we foster, the communities in which we live and work, and the history we build together. For more information, please visit www.brandywinerealty.com .

Conference Call and Audio Webcast

BDN management will discuss updated earnings guidance for fiscal 2018 on Thursday, October 18, 2018, during the company’s earnings call.  The conference call will begin at 9:00 a.m. Eastern Time and will last approximately one hour.  The conference call can be accessed by dialing 1-833-818-6810 and providing conference ID: 9359369.  Beginning two hours after the conference call, a taped replay of the call can be accessed through Friday, November 2, 2018, by calling 1-855-859-2056 and entering access code 9359369.  The conference call can also be accessed via a webcast on our website at www.brandywinerealty.com .

Looking Ahead – Fourth Quarter 2018 Conference Call

We anticipate we will release our fourth quarter 2018 earnings on Wednesday, January 30, 2019, after the market close and will host our fourth quarter 2018 conference call on Thursday, January 31, 2019 at 9:00 a.m. Eastern Time.  We expect to issue a press release in advance of these events to reconfirm the dates and times and provide all related information.

Forward-Looking Statements

Estimates of future earnings per share, FFO per share, common share dividend distributions and certain other statements in this release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our and our affiliates’ actual results, performance, achievements or transactions to be materially different from any future results, performance, achievements or transactions expressed or implied by such forward-looking statements.  Such risks, uncertainties and other factors relate to, among others: our ability to lease vacant space and to renew or relet space under expiring leases at expected levels; competition with other real estate companies for tenants; the potential loss or bankruptcy of major tenants; interest rate levels; the availability of debt, equity or other financing; risks of acquisitions, dispositions and developments, including the cost of construction delays and cost overruns; unanticipated operating and capital costs; our ability to obtain adequate insurance, including coverage for terrorist acts; dependence upon certain geographic markets; and general and local economic and real estate conditions, including the extent and duration of adverse changes that affect the industries in which our tenants operate.  The declaration and payment of future dividends (both timing and amount) is subject to the determination of our Board of Trustees, in its sole discretion, after considering various factors, including the Company's financial condition, historical and forecast operating results, and available cash flow, as well as any applicable laws and contractual covenants and any other relevant factors.  The Company's practice regarding payment of dividends may be modified at any time and from time to time.  Additional information on factors which could impact us and the forward-looking statements contained herein are included in our filings with the Securities and Exchange Commission, including our Form 10-K for the year ended December 31, 2017.  We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events except as required by law.

Non-GAAP Supplemental Financial Measures

We compute our financial results in accordance with generally accepted accounting principles (GAAP).  Although FFO and NOI are non-GAAP financial measures, we believe that FFO and NOI calculations are helpful to shareholders and potential investors and are widely recognized measures of real estate investment trust performance.  At the end of this press release, we have provided a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measure.

Funds from Operations (FFO)

We compute FFO in accordance with standards established by the National Association of Real Estate Investment Trusts (NAREIT), which may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than us.  NAREIT defines FFO as net income (loss) before non-controlling interests and excluding gains (losses) on sales of depreciable operating property, impairment losses on depreciable consolidated real estate, impairment losses on investments in unconsolidated real estate ventures and extraordinary items (computed in accordance with GAAP); plus real estate related depreciation and amortization (excluding amortization of deferred financing costs), and after similar adjustments for unconsolidated joint ventures.  Net income, the GAAP measure that we believe to be most directly comparable to FFO, includes depreciation and amortization expenses, gains or losses on property sales, extraordinary items and non-controlling interests.  To facilitate a clear understanding of our historical operating results, FFO should be examined in conjunction with net income (determined in accordance with GAAP) as presented in the financial statements included elsewhere in this release.  FFO does not represent cash flow from operating activities (determined in accordance with GAAP) and should not be considered to be an alternative to net income (loss) (determined in accordance with GAAP) as an indication of our financial performance or to be an alternative to cash flow from operating activities (determined in accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available for our cash needs, including our ability to make cash distributions to shareholders.

Net Operating Income (NOI)

NOI is a financial measure equal to net income available to common shareholders, the most directly comparable GAAP financial measure, plus corporate general and administrative expense, depreciation and amortization, interest expense, non-controlling interest in the Operating Partnership and losses from early extinguishment of debt, less interest income, development and management income, gains from property dispositions, gains on sale from discontinued operations, gains on early extinguishment of debt, income from discontinued operations, income from unconsolidated joint ventures and non-controlling interest in property partnerships.  In some cases we also present NOI on a cash basis, which is NOI after eliminating the effects of straight-lining of rent and deferred market intangible amortization.  NOI presented by us may not be comparable to NOI reported by other REITs that define NOI differently.  NOI should not be considered an alternative to net income as an indication of our performance or to cash flows as a measure of the Company's liquidity or its ability to make distributions.  NOI is a useful measure for evaluating the operating performance of our properties, as it excludes certain components from net income available to common shareholders in order to provide results that are more closely related to a property's results of operations.  NOI is used internally to evaluate the performance of our operating segments and to make decisions about resource allocations.  We concluded that NOI provides useful information to investors regarding our financial condition and results of operations, as it reflects only the income and expense items incurred at the property level, as well as the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and development activity on an unlevered basis.

Core Portfolio

Our core portfolio is comprised of our wholly-owned properties, excluding any properties currently in development, re-development or re-entitlement.

Company / Investor Contact:
Tom Wirth
EVP & CFO
610-832-7434
tom.wirth@bdnreit.com


BRANDYWINE REALTY TRUST
CONSOLIDATED BALANCE SHEETS
(in thousands)
 
  September 30,  December 31, 
  2018  2017 
ASSETS (unaudited)     
Real estate investments:        
Operating properties $3,429,048  $3,832,348 
Accumulated depreciation  (845,674)  (895,091)
Operating real estate investments, net  2,583,374   2,937,257 
Construction-in-progress  157,075   121,188 
Land held for development  77,578   98,242 
Prepaid leasehold interests in land held for development, net  40,100   - 
Total real estate investments, net  2,858,127   3,156,687 
Assets held for sale, net  297,194   392 
Cash and cash equivalents  70,360   202,179 
Accounts receivable, net of allowance of $3,782 and $3,467 as of September 30, 2018 and December 31, 2017, respectively  13,871   17,938 
Accrued rent receivable, net of allowance of $13,562 and $13,645 as of September 30, 2018 and December 31, 2017, respectively  178,013   169,760 
Investment in real estate ventures, at equity  167,782   194,621 
Deferred costs, net  97,004   96,695 
Intangible assets, net  55,139   64,972 
Other assets  186,132   92,204 
Total assets $3,923,622  $3,995,448 
LIABILITIES AND BENEFICIARIES' EQUITY        
Mortgage notes payable, net $322,588  $317,216 
Unsecured term loan, net  248,677   248,429 
Unsecured senior notes, net  1,366,272   1,365,183 
Accounts payable and accrued expenses  116,994   107,074 
Distributions payable  32,492   32,456 
Deferred income, gains and rent  26,731   42,593 
Acquired lease intangibles, net  17,680   20,274 
Liabilities related to assets held for sale  826   - 
Other liabilities  14,559   15,623 
Total liabilities $2,146,819  $2,148,848 
         
Brandywine Realty Trust's Equity:        
Common Shares of Brandywine Realty Trust's beneficial interest, $0.01 par value; shares authorized 400,000,000; 178,602,602 and 178,285,236 issued and outstanding as of September 30, 2018 and December 31, 2017, respectively  1,787   1,784 
Additional paid-in-capital  3,223,817   3,218,564 
Deferred compensation payable in common shares  14,021   12,445 
Common shares in grantor trust, 977,120 and 894,736 issued and outstanding as of September 30, 2018 and December 31, 2017, respectively  (14,021)  (12,445)
Cumulative earnings  674,599   660,174 
Accumulated other comprehensive income  10,239   2,399 
Cumulative distributions  (2,150,463)  (2,053,741)
Total Brandywine Realty Trust's equity  1,759,979   1,829,180 
Noncontrolling interests  16,824   17,420 
Total beneficiaries' equity  1,776,803   1,846,600 
Total liabilities and beneficiaries' equity $3,923,622  $3,995,448 


BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share data)
 
      
 Three Months Ended September 30,  Nine Months Ended September 30, 
 2018  2017  2018  2017 
Revenue               
Rents$107,580  $102,557  $321,597  $307,446 
Tenant reimbursements 20,557   17,239   59,094   53,812 
Termination fees 498   200   1,630   2,013 
Third party management fees, labor reimbursement and leasing 4,944   6,918   17,531   20,483 
Other 1,419   1,524   5,290   3,395 
Total revenue 134,998   128,438   405,142   387,149 
Operating expenses:               
Property operating expenses 37,833   36,847   115,052   110,947 
Real estate taxes 12,433   11,235   37,272   34,062 
Third party management expenses 2,612   2,619   9,605   7,391 
Depreciation and amortization 43,900   42,429   130,908   132,584 
General and administrative expenses 5,963   5,813   22,209   21,797 
Provision for impairment 56,865   -   56,865   3,057 
Total operating expenses 159,606   98,943   371,911   309,838 
Operating income (loss) (24,608)  29,495   33,231   77,311 
Other income (expense):               
Interest income 1,220   79   2,564   635 
Interest expense (19,257)  (19,732)  (58,091)  (61,473)
Interest expense - amortization of deferred financing costs (618)  (577)  (1,872)  (1,807)
Equity in income (loss) of Real Estate Ventures 1   (5,723)  (1,182)  (5,387)
Net gain (loss) on disposition of real estate -   -   (35)  8,411 
Net gain on sale of undepreciated real estate -   953   2,859   953 
Net gain on Real Estate Venture transactions -   13,758   37,263   28,340 
Net income (loss) before income taxes (43,262)  18,253   14,737   46,983 
Income tax (provision) benefit -   793   (158)  1,032 
Net income (loss) (43,262)  19,046   14,579   48,015 
Net (income) loss attributable to noncontrolling interests 339   (170)  (167)  (384)
Net income (loss) attributable to Brandywine Realty Trust (42,923)  18,876   14,412   47,631 
Distribution to preferred shareholders -   -   -   (2,032)
Preferred share redemption charge -   -   -   (3,181)
Nonforfeitable dividends allocated to unvested restricted shareholders (80)  (73)  (280)  (245)
Net income (loss) attributable to Common Shareholders of Brandywine Realty Trust$(43,003) $18,803  $14,132  $42,173 
                
PER SHARE DATA               
Basic income (loss) per Common Share$(0.24) $0.11  $0.08  $0.24 
Basic weighted average shares outstanding 178,602,622   175,433,657   178,515,993   175,315,581 
                
Diluted income (loss) per Common Share$(0.24) $0.11  $0.08  $0.24 
Diluted weighted average shares outstanding 178,602,622   176,835,022   179,752,544   176,599,332 


BRANDYWINE REALTY TRUST
FUNDS FROM OPERATIONS
(unaudited, in thousands, except share and per share data)
       
 Three Months Ended September 30,   Nine Months Ended September 30, 
 2018  2017   2018  2017 
Reconciliation of Net Income (Loss) to Funds from Operations:                
Net income (loss) attributable to common shareholders$(43,003) $18,803   $14,132  $42,173 
Add (deduct):                
Net income (loss) attributable to noncontrolling interests - LP units (359)  158    121   359 
Nonforfeitable dividends allocated to unvested restricted shareholders 80   73    280   245 
Net gain on real estate venture transactions -   (13,758)   (37,263)  (28,340)
Net (gain) loss on disposition of real estate -   -    35   (8,411)
Provision for impairment 56,865   -    56,865   2,730 
Other than temporary impairment of equity method investment -   4,844    -   4,844 
Depreciation and amortization:                
Real property 35,011   34,742    104,798   104,340 
Leasing costs including acquired intangibles 8,482   7,464    24,932   27,713 
Company’s share of unconsolidated real estate ventures 6,334   9,816    20,230   30,505 
Partners’ share of consolidated real estate ventures (57)  (54)   (166)  (177)
Funds from operations$63,353  $62,088   $183,964  $175,981 
Funds from operations allocable to unvested restricted shareholders (157)  (162)   (528)  (511)
Funds from operations available to common share and unit holders (FFO)$63,196  $61,926   $183,436  $175,470 
                 
FFO per share - fully diluted$0.35  $0.35   $1.01  $0.99 
                 
Weighted-average shares/units outstanding - fully diluted 181,253,953   178,314,821    181,232,343   178,079,131 
                 
Distributions paid per common share$0.18  $0.16   $0.54  $0.48 
                 
FFO payout ratio (distributions paid per common share/FFO per diluted share) 51.4%  45.7%   53.5%  48.5%

BRANDYWINE REALTY TRUST
SAME STORE OPERATIONS – 3rd QUARTER
(unaudited and in thousands)

Of the 93 properties owned by the Company as of September 30, 2018, a total of 76 properties ("Same Store Properties") containing an aggregate of 14.2 million net rentable square feet were owned for the entire three-month periods ended September 30, 2018 and 2017. As of September 30, 2018, two properties were recently completed/acquired, two properties were in development and five properties were in redevelopment. Average occupancy for the Same Store Properties was 92.9% during 2018 and 92.0% during 2017. The following table sets forth revenue and expense information for the Same Store Properties:

  Three Months Ended September 30, 
  2018  2017 
Revenue        
Rents $93,210  $90,854 
Tenant reimbursements  19,109   16,793 
Termination fees  498   200 
Other  345   541 
Total revenue  113,162   108,388 
         
Operating expenses        
Property operating expenses  32,193   31,072 
Real estate taxes  10,520   9,270 
Net operating income $70,449  $68,046 
         
Net operating income - percentage change over prior year  3.5%    
         
Net operating income, excluding net termination fees & other $69,606  $67,305 
         
Net operating income, excluding net termination fees & other - percentage change over prior year  3.4%    
         
Net operating income $70,449  $68,046 
Straight line rents & other  (1,978)  (7,961)
Above/below market rent amortization  (406)  (457)
Amortization of tenant inducements  238   312 
Non-cash ground rent  22   22 
Cash - Net operating income $68,325  $59,962 
         
Cash - Net operating income - percentage change over prior year  13.9%    
         
Cash - Net operating income, excluding net termination fees & other $67,265  $59,161 
         
Cash - Net operating income, excluding net termination fees & other - percentage change over prior year  13.7%    
         
  Three Months Ended September 30, 
  2018  2017 
Net income (loss): $(43,262) $19,046 
Add/(deduct):        
Interest income  (1,220)  (79)
Interest expense  19,257   19,732 
Interest expense - amortization of deferred financing costs  618   577 
Equity in (income) loss of Real Estate Ventures  (1)  5,723 
Net gain on Real Estate Venture transactions  -   (13,758)
Net gain on sale of undepreciated real estate  -   (953)
Depreciation and amortization  43,900   42,429 
General & administrative expenses  5,963   5,813 
Income tax benefit  -   (793)
Provision for impairment  56,865   - 
Consolidated net operating income  82,120   77,737 
Less: Net operating income of non-same store properties and elimination of non-property specific operations  (11,671)  (9,691)
Same store net operating income $70,449  $68,046 

BRANDYWINE REALTY TRUST
SAME STORE OPERATIONS – NINE MONTHS
(unaudited and in thousands)

Of the 93 properties owned by the Company as of September 30, 2018, a total of 73 properties ("Same Store Properties") containing an aggregate of 13.0 million net rentable square feet were owned for the entire nine-month periods ended September 30, 2018 and 2017. As of September 30, 2018, five properties were recently completed/acquired, two properties were in development and five properties were in redevelopment. Average occupancy for the Same Store Properties was 92.9% during 2018 and 94.4% during 2017. The following table sets forth revenue and expense information for the Same Store Properties:

  Nine Months Ended September 30, 
  2018  2017 
Revenue        
Rents $247,836  $249,669 
Tenant reimbursements  49,750   47,914 
Termination fees  1,630   1,536 
Other  1,197   1,422 
Total revenue  300,413   300,541 
         
Operating expenses        
Property operating expenses  88,207   86,085 
Real estate taxes  30,000   26,797 
Net operating income $182,206  $187,659 
         
Net operating income - percentage change over prior year  -2.9%    
         
Net operating income, excluding net termination fees & other $179,379  $184,701 
         
Net operating income, excluding net termination fees & other - percentage change over prior year  -2.9%    
         
Net operating income $182,206  $187,659 
Straight line rents & other  (982)  (5,943)
Above/below market rent amortization  (1,266)  (2,244)
Amortization of tenant inducements  561   697 
Non-cash ground rent  67   67 
Cash - Net operating income $180,586  $180,236 
         
Cash - Net operating income - percentage change over prior year  0.2%    
         
Cash - Net operating income, excluding net termination fees & other $177,096  $176,349 
         
Cash - Net operating income, excluding net termination fees & other - percentage change over prior year  0.4%    
         
  Nine Months Ended September 30, 
  2018  2017 
Net income: $14,579  $48,015 
Add/(deduct):        
Interest income  (2,564)  (635)
Interest expense  58,091   61,473 
Interest expense - amortization of deferred financing costs  1,872   1,807 
Equity in loss of Real Estate Ventures  1,182   5,387 
Net gain on Real Estate Venture transactions  (37,263)  (28,340)
Net (gain) loss on disposition of real estate  35   (8,411)
Net gain on sale of undepreciated assets  (2,859)  (953)
Depreciation and amortization  130,908   132,584 
General & administrative expenses  22,209   21,797 
Income tax provision (benefit)  158   (1,032)
Provision for impairment  56,865   3,057 
Consolidated net operating income  243,213   234,749 
Less: Net operating income of non-same store properties and elimination of non-property specific operations  (61,007)  (47,090)
Same store net operating income $182,206  $187,659 

 

brandy.jpg

Source: Brandywine Realty Trust


Register |  Password |  Feedback |  Copyright |  Usage Agreement |  Privacy Policy |  Advertising |  About Us |  Contact Us |  FAQ 

Past performance is not indicative of future results

StockSelector.com, the StockSelector.com logo, and News Selects are trademarks of StockSelector.com.
Copyright © 1998 - 2019 StockSelector.com. All rights reserved.