BETHESDA, Md., April 27,
2017 /PRNewswire/ -- First Potomac Realty Trust (NYSE: FPO), a
leader in the ownership, management, development and redevelopment
of office and business park properties in the greater Washington, D.C. region, reported results for
the three months ended March 31, 2017.
First Quarter 2017 Highlights
- Reported net income attributable to common shareholders of
$43.1 million, or $0.74 per diluted share.
- Reported Core Funds From Operations of $13.9 million, or $0.23 per diluted share.
- Increased same property net operating income ("Same Property
NOI") by 1.2% on an accrual basis compared with the same period in
2016.
- Occupied and leased percentages at March 31, 2017 remained relatively flat at 92.4%
and 94.0%, respectively, compared with March
31, 2016.
- As previously disclosed, sold One
Fair Oaks, a 214,000 square-foot office building located in
Northern Virginia, for net
proceeds of $13.3 million in
January 2017, and sold Plaza 500, a
503,000 square-foot industrial property located in Northern Virginia, for net proceeds of
$72.5 million in February 2017.
- In March 2017, sold Rivers
Park I and II, a 308,000 square-foot business park, and Aviation
Business Park, a 120,000 square-foot office building, which were
all located in Maryland and owned
through unconsolidated joint ventures, for net proceeds based on
our ownership interest in the joint ventures of $18.4 million.
Bob Milkovich, Chief Executive
Officer of First Potomac Realty Trust stated, "With over
$100 million of additional non-core
asset sales completed during the first quarter, we have largely
achieved the disposition goals we announced in February 2016. In addition, with One Fair Oaks sold, 540 Gaither in active
redevelopment with two floors already pre-leased and the potential
for a short-term extension with the Bureau of Prisons at 500 First
Street, we have addressed our major lease expirations and
significantly reduced the risk of our portfolio. As we move forward
in 2017, we will have a stronger portfolio and a more flexible
capital structure to drive growth and to maximize shareholder
value."
Reconciliation of Net Income (Loss)
Attributable to Common Shareholders and FFO, FFO Available to
Common Shareholders and Unitholders and Core FFO
|
(amounts in
thousands, except per share amounts)
|
|
|
Three Months Ended
March 31,
|
|
2017
|
|
2016
|
Net income (loss)
attributable to common shareholders
|
$
|
43,145
|
|
|
$
|
(4,106)
|
|
Depreciation and
amortization:
|
|
|
|
Rental
property
|
14,566
|
|
|
15,006
|
|
Unconsolidated joint ventures
|
870
|
|
|
881
|
|
(Gain) loss on sale
of rental property
|
(42,799)
|
|
|
1,155
|
|
Gain on sale of
rental property owned through unconsolidated joint
ventures(1)
|
(3,797)
|
|
|
—
|
|
Net income (loss)
attributable to noncontrolling interests in the Operating
Partnership
|
1,884
|
|
|
(133)
|
|
Dividends on
preferred shares
|
—
|
|
|
2,248
|
|
Issuance costs of
redeemed preferred shares(2)
|
—
|
|
|
1,904
|
|
Funds from operations
("FFO")
|
13,869
|
|
|
16,955
|
|
Dividends on
preferred shares
|
—
|
|
|
(2,248)
|
|
Issuance costs of
redeemed preferred shares(2)
|
—
|
|
|
(1,904)
|
|
FFO available to
common shareholders and unitholders
|
13,869
|
|
|
12,803
|
|
Issuance costs of
redeemed preferred shares(2)
|
—
|
|
|
1,904
|
|
Loss on debt
extinguishment
|
—
|
|
|
48
|
|
Core FFO
|
$
|
13,869
|
|
|
$
|
14,755
|
|
|
|
|
|
Net income (loss)
attributable to common shareholders per share - basic
|
$
|
0.75
|
|
|
$
|
(0.07)
|
|
Net income (loss)
attributable to common shareholders per share - diluted
|
$
|
0.74
|
|
|
$
|
(0.07)
|
|
Weighted average
basic common shares
|
57,635
|
|
|
57,542
|
|
Weighted average
diluted common shares
|
57,907
|
|
|
57,542
|
|
|
|
|
|
FFO available to
common shareholders and unitholders per share – basic and
diluted
|
$
|
0.23
|
|
|
$
|
0.21
|
|
Core FFO per share –
diluted
|
$
|
0.23
|
|
|
$
|
0.24
|
|
Weighted average
basic common shares and units
|
60,181
|
|
|
60,149
|
|
Weighted average
diluted common shares and units
|
60,452
|
|
|
60,234
|
|
|
|
(1)
|
Reflects our
proportionate share of the gain on sale of Aviation Business Park
and Rivers Park I and II, which were sold by the unconsolidated
joint ventures that owned the respective properties. The gain is
reflected within equity in earnings on our consolidated income
statement for the three months ended March 31, 2017.
|
(2)
|
Represents original
issuance costs associated with the 7.750% Series A Cumulative
Redeemable Perpetual Preferred Shares (the "7.750% Series A
Preferred Shares") that were redeemed during the three months ended
March 31, 2016.
|
The definitions of FFO, FFO available to common shareholders and
unitholders and Core FFO, as well as the statements of purpose, are
included below under "Non-GAAP Financial Measures."
First Quarter Results
Net income (loss) attributable to common shareholders, Core FFO
and FFO available to common shareholders and unitholders for the
three months ended March 31, 2017 and
2016 are as follows (in thousands):
|
Three Months
Ended
March 31,
|
|
|
|
2017
|
|
2016
|
|
Change
|
Net income (loss)
attributable to common shareholders
|
$
|
43,145
|
|
|
$
|
(4,106)
|
|
|
$
|
47,251
|
|
Core FFO
|
$
|
13,869
|
|
|
$
|
14,755
|
|
|
$
|
(886)
|
|
FFO available to
common shareholders and unitholders
|
$
|
13,869
|
|
|
$
|
12,803
|
|
|
$
|
1,066
|
|
Three months ended March 31, 2017 compared with
the same period in 2016
Positive impacts to net income attributable to common
shareholders, Core FFO and FFO available to common shareholders and
unitholders reflect the following:
- a $2.2 million reduction in
accrued preferred dividends due to the redemption of all of the
outstanding 7.750% Series A Preferred Shares during 2016;
- an additional $0.9 million of net
operating income resulting from rent commencement at the NOVA
build-to-suit, which was placed in-service in August 2016;
- a $0.5 million decrease in
interest expense primarily due to a reduction in our outstanding
debt; and
- a $0.3 million increase in Same
Property net operating income ("Same Property NOI").
Net income attributable to common shareholders, Core FFO and FFO
available to common shareholders and unitholders were adversely
impacted by the following:
- a $3.7 million reduction in net
operating income due to property dispositions during 2016 and the
first quarter of 2017; and
- an $0.8 million decrease in
interest income due to the repayment of the $34.0 million mezzanine loan on 950 F Street, NW
in the second quarter of 2016.
Operating Performance - Leasing and Occupancy
At March 31, 2017, our consolidated portfolio
consisted of 71 buildings totaling 6.0 million square feet. Leasing
and occupancy highlights for our consolidated portfolio were as
follows:
Leased and occupied
%(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2017
|
|
March 31,
2016
|
|
Year-over-year
basis point
increase
|
|
December 31,
2016
|
Leased
|
94.0
|
%
|
|
94.1
|
%
|
|
(10)
|
|
|
93.8
|
%
|
Occupied
|
92.4
|
%
|
|
92.3
|
%
|
|
10
|
|
|
92.6
|
%
|
|
(1)
Excludes properties in development or redevelopment for the
respective periods.
|
Leased and occupied percentages during the first quarter of 2017
remained relatively flat compared with the same period in 2016.
Leasing Activity
(square feet)
|
|
|
Three Months
Ended March 31, 2017
|
Total new
leases
|
74,000
|
Total renewal
leases
|
89,000
|
Total leases
executed
|
163,000
|
The 89,000 square feet of renewal leases in the quarter
reflected a tenant retention rate of 32%, and we experienced
negative net absorption of 116,000 square feet in the first quarter
of 2017. The low retention rate and negative net absorption were
due to the lease termination of the Department of Health and Human
Services at 540 Gaither Road ("Redland I") at Redland, who was the
sole tenant of the 134,000 square-foot building. We have begun
repositioning Redland I as the building was placed into
redevelopment in March 2017. In
addition, during the second quarter of 2016, we re-leased two
floors at Redland I, which totaled 45,000 square feet, or
approximately 34% of the building's total square footage. We
anticipate that the new tenant at Redland I will take occupancy in
early 2018; however, we can provide no assurances regarding the
timing of when the tenant will take occupancy.
Operating Performance - Same Properties
Same Property NOI increased (decreased) on an accrual basis for
the three months ended March 31, 2017 compared with the
same period in 2016 as follows:
|
% Increase (Decrease)
in
Same Property NOI
|
Washington,
D.C.
|
2.5
|
%
|
Maryland
|
3.9
|
%
|
Northern
Virginia
|
2.9
|
%
|
Southern
Virginia
|
(4.9)
|
%
|
Total - accrual
basis
|
1.2
|
%
|
Increases in Same Property NOI in Washington, D.C., Maryland and Northern Virginia for the three months ended
March 31, 2017 compared with the same
period in 2016 were due to increases in occupancy, particularly at
the following properties: 440 First Street, NW and 1401 K Street,
NW, which are both located in Washington,
D.C., Cloverleaf Center, which is located in Maryland, and Atlantic Corporate Park, which
is located in Northern Virginia.
Same Property NOI decreased for the three months ended
March 31, 2017 compared with the same period in 2016 in
Southern Virginia due to a
decrease in occupancy at Crossways Commerce Center and an increase
in snow and ice removal costs.
A reconciliation of net income (loss) from our consolidated
statements of operations to Same Property NOI and a definition and
statement of purpose are included below in the financial tables
accompanying this press release and under "Non-GAAP Financial
Measures," respectively.
A list of our properties, as well as additional information
regarding our results of operations, can be found in our First
Quarter 2017 Supplemental Financial Information Report, which is
posted on our website, www.first-potomac.com.
Dispositions
As previously disclosed, on January 9,
2017, we sold One Fair Oaks,
a 214,000 square-foot office building located in Northern Virginia, for gross proceeds of
$13.7 million, which generated net
proceeds of $13.3 million, and on
February 17, 2017, we sold Plaza 500,
a 503,000 square-foot industrial property located in Northern Virginia, for gross proceeds of
$75.0 million, which generated net
proceeds of $72.5 million.
On March 7, 2017, three of our
unconsolidated joint ventures collectively sold Aviation Business
Park and Rivers Park I and II, which were all located in
Maryland. Based on our percentage
ownership of the joint ventures, our share of gross proceeds from
the sale totaled $19.0 million, which
generated $18.4 million of net
proceeds. We used the net proceeds from the sale to repay
$7.0 million (our proportionate
share) of mortgage debt encumbering Rivers Park I and II, and the
remainder was used to repay a portion of the outstanding balance
under our unsecured revolving credit facility.
Balance Sheet
We had $649.5 million of
gross debt outstanding at March 31, 2017, of which
$231.7 million was fixed-rate
debt, $240.0 million was hedged
variable-rate debt and $177.8 million was unhedged variable-rate
debt. The weighted average interest rate of our debt was 3.7% at
March 31, 2017.
Dividends
On April 25, 2017, we declared a dividend of $0.10 per common share, equating to an annualized
dividend of $0.40 per common share.
The dividend will be paid on May 15, 2017 to common
shareholders of record as of May 8, 2017.
2017 Core FFO Guidance
We are raising our full-year 2017 Core FFO guidance from our
previous range of $0.78 to $0.84 to a
current range of $0.80 to $0.85 per
diluted share. The following is a summary of the assumptions that
we used in arriving at our guidance (unaudited, amounts in
thousands except percentages and per share amounts):
|
|
Expected
Ranges
|
Portfolio Net
Operating Income(1)
|
|
$
|
84,000
|
|
-
|
$
|
88,000
|
|
Interest and Other
Income
|
|
$
|
450
|
|
-
|
$
|
550
|
|
FFO from
Unconsolidated Joint Ventures(2)
|
|
$
|
4,500
|
|
-
|
$
|
5,000
|
|
Interest
Expense
|
|
$
|
23,000
|
|
-
|
$
|
25,000
|
|
General and
Administrative Expense
|
|
$
|
17,500
|
|
-
|
$
|
18,500
|
|
Weighted Average
Shares and OP Units
|
|
60,400
|
|
-
|
60,800
|
|
Year-End
Occupancy(3)
|
|
91.0
|
%
|
-
|
93.0
|
%
|
Same Property NOI
Growth - Accrual Basis(4)
|
|
-1.0
|
%
|
-
|
+1.0
|
%
|
|
|
(1)
|
Reflects the sale of
One Fair Oaks, which occurred on January 9, 2017, as well as the
sale of Plaza 500, which occurred on February 17, 2017. No
assumption for additional acquisitions or dispositions is included
in the guidance range.
|
(2)
|
Reflects the sale of
Aviation Business Park and Rivers Park I and II, which occurred on
March 7, 2017.
|
(3)
|
Assumes 500 First
Street, NW and 540 Gaither Road at Redland are placed into
redevelopment during 2017, and the square footage associated with
the properties is excluded from reported portfolio metrics,
including occupancy.
|
(4)
|
Assumes 500 First
Street, NW and 540 Gaither Road at Redland are placed into
redevelopment during 2017, resulting in the properties being
excluded from the full-year 2017 same property NOI
calculation.
|
Our guidance is also based on a number of other assumptions,
many of which are outside our control and all of which are subject
to change. We may change our guidance as actual and anticipated
results vary from these assumptions.
Guidance Range for
2017
|
|
Low Range
|
|
High Range
|
Net income attributable
to common shareholders per diluted share
|
|
$
|
0.63
|
|
|
$
|
0.66
|
|
Real
estate depreciation(1)
|
|
0.97
|
|
|
0.99
|
|
Net income attributable
to noncontrolling interests and items excluded
from
Core FFO per diluted share(2)
|
|
(0.80)
|
|
|
(0.80)
|
|
Core FFO per diluted
share
|
|
$
|
0.80
|
|
|
$
|
0.85
|
|
|
|
|
|
|
|
|
(1)
|
Includes our pro-rata
share of depreciation from our unconsolidated joint ventures and
depreciation related to disposed properties.
|
(2)
|
Items excluded from
Core FFO consist of personnel separation costs, the gains or losses
associated with disposed properties, property impairment, loss on
debt extinguishment and other non-recurring items.
|
Investor Conference Call and Webcast
We will host a conference call on April 28, 2017 at
9:00 AM ET to discuss the first
quarter 2017 results and our 2017 Core FFO guidance. The conference
call can be accessed by dialing (877) 425-9470 or (201) 389-0878
for international participants. A replay of the call will be
available from 12:00 PM ET on
April 28, 2017, until midnight
ET on May 5, 2017. The
replay can be accessed by dialing (844) 512-2921 or (412) 317-6671
for international callers, and entering pin number 13659183.
A live broadcast of the conference call will also be available
online at the Company's website, www.first-potomac.com, on
April 28, 2017 beginning at 9:00 AM
ET. An online replay will follow shortly after the
call and will continue for 90 days.
About First Potomac Realty Trust
First Potomac Realty Trust is a self-administered, self-managed
real estate investment trust that focuses on owning, operating,
developing and redeveloping office and business park properties in
the greater Washington, D.C.
region. FPO common shares (NYSE: FPO) are publicly traded on
the New York Stock Exchange. As of March 31, 2017,
our consolidated portfolio totaled 6.0 million square feet. Based
on annualized cash basis rent, our portfolio consists of 66% office
properties and 34% business park properties. A key element of First
Potomac's overarching strategy is its dedication to sustainability.
Over one million square feet of First Potomac property is LEED
Certified and over half of the portfolio's multi-story office
square footage is LEED or Energy Star Certified.
Non-GAAP Financial Measures
Funds from Operations - Funds from operations ("FFO"),
which is a non-GAAP measure used by many investors and analysts
that follow the public real estate industry, represents net income
(computed in accordance with U.S. generally accepted accounting
principles ("GAAP")), excluding gains (losses) on sales of rental
property and impairments of rental property, plus real
estate-related depreciation and amortization and after adjustments
for unconsolidated partnerships and joint ventures. We also exclude
from our FFO calculation the impact related to third parties from
our consolidated joint venture. FFO available to common
shareholders and unitholders is calculated as FFO less accumulated
dividends on our preferred shares for the applicable periods
presented. We compute FFO in accordance with standards
established by the National Association of Real Estate Investment
Trusts ("NAREIT"), which may differ from the methodology for
calculating FFO, or similarly titled measures, utilized by other
equity REITs and, accordingly, may not be comparable to such other
REITs.
We consider FFO and FFO available to common shareholders and
unitholders useful measures of performance for an equity real
estate investment trust ("REIT") as they facilitate an
understanding of the operating performance of our properties
without giving effect to real estate depreciation and amortization,
which assume that the value of rental property diminishes
predictably over time. Since real estate values have historically
risen or fallen with market conditions, we believe that FFO
provides a meaningful indication of our performance. We also
consider FFO an appropriate supplemental performance measure given
its wide use by investors and analysts. However, FFO does not
represent amounts available for our discretionary use because of
needed capital replacement or expansion, debt service obligations
or other commitments and uncertainties, nor is it indicative of
funds available to fund our cash needs, including our ability to
make distributions. Our methodology for computing FFO adds back
noncontrolling interests in the income from our Operating
Partnership in determining FFO. We believe this is appropriate as
common Operating Partnership units are presented on an
as-converted, one-for-one basis for common shares in determining
FFO per diluted share.
Our presentation of FFO in accordance with NAREIT's definition
should not be considered as an alternative to net (loss) income
attributable to common shareholders (computed in accordance with
GAAP) as an indicator of our financial performance.
Core FFO - We believe that the computation of FFO in
accordance with NAREIT's definition includes certain items that are
not indicative of the results provided by our operating portfolio
and affect the comparability of our period-over-period performance.
These items include, but are not limited to, gains and losses on
the retirement of debt, personnel separation costs, contingent
consideration charges, acceleration of deferred abatement and
straight-line amortization, gains on the receipt of yield
maintenance payments from the prepayment of a note receivable,
issuance costs of redeemed preferred shares and acquisition costs.
Core FFO is presented less accumulated dividends on our preferred
shares for all the periods presented.
Our presentation of Core FFO should not be considered as an
alternative to net (loss) income attributable to common
shareholders (computed in accordance with GAAP) as an indicator of
our financial performance. Our FFO and Core FFO calculations
are reconciled to (loss) income attributable to common shareholders
in this release.
Same Property NOI - Same Property Net Operating Income
("Same Property NOI"), defined as property revenues (rental and
tenant reimbursements and other revenues) less property operating
expenses (real estate taxes, property operating and insurance
expenses) from the consolidated properties owned by us and
in-service for the entirety of the periods presented, is a primary
performance measure we use to assess the results of operations at
our properties. Same Property NOI is a non-GAAP
measure. As an indication of our operating performance, Same
Property NOI should not be considered an alternative to net income
(loss) calculated in accordance with GAAP. A reconciliation
of our Same Property NOI to net income is presented below.
The Same Property NOI results exclude the collection of termination
fees, as these items vary significantly period-over-period, thus
impacting trends and comparability. Also, Same Property NOI
includes a normalized management fee percentage in lieu of an
administrative overhead allocation for comparative purposes.
We eliminate depreciation and amortization expense, which are
property level expenses, in computing Same Property NOI as these
are non-cash expenses that are based on historical cost accounting
assumptions and management believes these expenses do not offer the
investor significant insight into the operations of the property.
This presentation allows management and investors to determine
whether growth or declines in net operating income are a result of
increases or decreases in property operations or the acquisition or
disposition of additional properties. While this presentation
provides useful information to management and investors, the
results below should be read in conjunction with the results from
the consolidated statements of operations to provide a complete
depiction of our total performance.
Forward-Looking Statements
The forward-looking statements contained in this press release,
including statements regarding our 2017 Core FFO guidance and
related assumptions, potential dispositions and the timing and
pricing of such dispositions, future acquisition and growth
opportunities and the timing of future tenant occupancies, are
subject to various risks and uncertainties. Although we believe the
expectations reflected in any forward-looking statements contained
herein are based on reasonable assumptions, there can be no
assurance that our expectations will be achieved. Certain factors
that could cause actual results to differ materially from our
expectations include changes in general or regional economic
conditions; our ability to timely lease or re-lease space at
current or anticipated rents; changes in interest rates; changes in
operating costs; our ability to complete acquisitions and
dispositions on acceptable terms, or at all; our ability to manage
our current debt levels and repay or refinance our indebtedness
upon maturity or other required payment dates; our ability to
maintain financial covenant compliance under our debt agreements;
our ability to maintain effective internal controls over financial
reporting and disclosure controls and procedures; our ability to
obtain debt and/or financing on attractive terms, or at all;
changes in the assumptions underlying our earnings and Core FFO
guidance and other risks detailed in our Annual Report on Form 10-K
and described from time to time in our filings with the Securities
and Exchange Commission. Many of these factors are beyond our
ability to control or predict. Forward-looking statements are not
guarantees of performance. For forward-looking statements herein,
we claim the protection of the safe harbor for forward-looking
statements contained in the Private Securities Litigation Reform
Act of 1995. We assume no obligation to update or supplement
forward-looking statements that become untrue because of subsequent
events. We do not intend to, and expressly disclaim any duty to,
update or revise the forward-looking statements in this discussion
to reflect changes in underlying assumptions or factors, new
information, future events or otherwise, after the date hereof,
except as may be required by law. In light of these risks and
uncertainties, you should not rely upon these forward-looking
statements after the date of this report and should keep in mind
that any forward-looking statement made in this discussion, or
elsewhere, might not occur.
Consolidated
Statements of Operations
|
(unaudited,
amounts in thousands, except per share amounts)
|
|
|
Three Months Ended
March 31,
|
|
2017
|
|
2016
|
Revenues:
|
|
|
|
Rental
|
$
|
30,818
|
|
|
$
|
33,844
|
|
Tenant reimbursements
and other
|
7,005
|
|
|
8,853
|
|
Total
revenues
|
37,823
|
|
|
42,697
|
|
Operating
expenses:
|
|
|
|
Property
operating
|
9,958
|
|
|
11,537
|
|
Real estate taxes and
insurance
|
4,661
|
|
|
5,216
|
|
General and
administrative
|
4,497
|
|
|
4,578
|
|
Depreciation and
amortization
|
14,566
|
|
|
15,006
|
|
Total operating
expenses
|
33,682
|
|
|
36,337
|
|
Operating
income
|
4,141
|
|
|
6,360
|
|
Other expenses
(income):
|
|
|
|
Interest
expense
|
6,344
|
|
|
6,816
|
|
Interest and other
income
|
(210)
|
|
|
(1,003)
|
|
Equity in earnings of
affiliates
|
(4,223)
|
|
|
(555)
|
|
(Gain) loss on sale
of rental property
|
(42,799)
|
|
|
1,155
|
|
Loss on debt
extinguishment
|
—
|
|
|
48
|
|
Total other expenses
(income)
|
(40,888)
|
|
|
6,461
|
|
Net income
(loss)
|
45,029
|
|
|
(101)
|
|
Less: Net (income) loss
attributable to noncontrolling interests
|
(1,884)
|
|
|
147
|
|
Net income
attributable to First Potomac Realty Trust
|
43,145
|
|
|
46
|
|
Less: Dividends on preferred
shares
|
—
|
|
|
(2,248)
|
|
Less: Issuance costs of
redeemed preferred shares
|
—
|
|
|
(1,904)
|
|
Net income (loss)
attributable to common shareholders
|
$
|
43,145
|
|
|
$
|
(4,106)
|
|
|
|
|
|
Basic and diluted
earnings per common share:
|
|
|
|
Net income (loss)
attributable to common shareholders - basic
|
$
|
0.75
|
|
|
$
|
(0.07)
|
|
Net income (loss)
attributable to common shareholders - diluted
|
$
|
0.74
|
|
|
$
|
(0.07)
|
|
Weighted average
common shares outstanding:
|
|
|
|
Basic
|
57,635
|
|
|
57,542
|
|
Diluted
|
57,907
|
|
|
57,542
|
|
Consolidated
Balance Sheets
|
(amounts in
thousands, except per share amounts)
|
|
|
March 31, 2017
|
|
December 31,
2016
|
|
(unaudited)
|
|
|
Assets:
|
|
|
|
Rental property,
net
|
$
|
1,024,605
|
|
|
$
|
1,059,272
|
|
Assets
held-for-sale
|
—
|
|
|
13,176
|
|
Cash and cash
equivalents
|
13,269
|
|
|
14,144
|
|
Escrows and
reserves
|
2,348
|
|
|
1,419
|
|
Accounts and other
receivables, net of allowance for doubtful accounts of $922 and
$655, respectively
|
5,611
|
|
|
6,892
|
|
Accrued straight-line
rents, net of allowance for doubtful accounts of $471 and $414,
respectively
|
45,211
|
|
|
42,745
|
|
Investment in
affiliates
|
42,314
|
|
|
49,392
|
|
Deferred costs,
net
|
41,603
|
|
|
42,712
|
|
Prepaid expenses and
other assets
|
5,414
|
|
|
5,389
|
|
Intangibles assets,
net
|
23,622
|
|
|
25,106
|
|
Total
assets
|
$
|
1,203,997
|
|
|
$
|
1,260,247
|
|
Liabilities:
|
|
|
|
Mortgage loans,
net
|
$
|
295,523
|
|
|
$
|
296,212
|
|
Unsecured term loan,
net
|
299,433
|
|
|
299,404
|
|
Unsecured revolving
credit facility, net
|
48,758
|
|
|
141,555
|
|
Accounts payable and
other liabilities
|
40,897
|
|
|
43,904
|
|
Accrued
interest
|
1,470
|
|
|
1,537
|
|
Rents received in
advance
|
6,493
|
|
|
6,234
|
|
Tenant security
deposits
|
4,831
|
|
|
4,982
|
|
Deferred market rent,
net
|
1,716
|
|
|
1,792
|
|
Total
liabilities
|
699,121
|
|
|
795,620
|
|
Noncontrolling
interests in the Operating Partnership
|
27,516
|
|
|
28,244
|
|
Equity:
|
|
|
|
Common shares, $0.001
par value per share, 150,000 shares authorized; 58,716 and 58,319
shares issued and outstanding, respectively
|
59
|
|
|
58
|
|
Additional paid-in
capital
|
916,460
|
|
|
913,367
|
|
Accumulated other
comprehensive loss
|
(273)
|
|
|
(844)
|
|
Dividends in excess
of accumulated earnings
|
(438,886)
|
|
|
(476,198)
|
|
Total
equity
|
477,360
|
|
|
436,383
|
|
Total liabilities,
noncontrolling interests and equity
|
$
|
1,203,997
|
|
|
$
|
1,260,247
|
|
Same Property
Analysis
|
(unaudited,
dollars in thousands)
|
|
Reconciliation of
net income (loss) to Same Property
NOI(1):
|
|
|
|
|
Three Months Ended
March 31,
|
|
2017
|
|
2016
|
Number of
buildings
|
69
|
|
|
69
|
|
|
|
|
|
Net income
(loss)
|
$
|
45,029
|
|
|
$
|
(101)
|
|
Total other expenses
(income)
|
(40,888)
|
|
|
6,461
|
|
Depreciation and
amortization
|
14,566
|
|
|
15,006
|
|
General and
administrative expenses
|
4,497
|
|
|
4,578
|
|
Non-comparable net
operating income(2)
|
(1,901)
|
|
|
(4,902)
|
|
Same Property
NOI
|
$
|
21,303
|
|
|
$
|
21,042
|
|
|
|
|
|
Same property
revenues
|
|
|
|
Rental
|
$
|
28,471
|
|
|
$
|
27,779
|
|
Tenant reimbursements
and other(3)
|
6,187
|
|
|
6,655
|
|
Total same property
revenues
|
34,658
|
|
|
34,434
|
|
Same property
operating expenses
|
|
|
|
Property(4)
|
8,997
|
|
|
9,221
|
|
Real estate taxes and
insurance
|
4,358
|
|
|
4,171
|
|
Total same property
operating expenses
|
13,355
|
|
|
13,392
|
|
Same Property
NOI
|
$
|
21,303
|
|
|
$
|
21,042
|
|
|
|
|
|
Same Property NOI
growth
|
1.2
|
%
|
|
|
|
|
|
|
|
Weighted Average
Occupancy for the
Three Months Ended March 31,
|
|
2017
|
|
2016
|
Same
Properties
|
92.1
|
%
|
|
92.3
|
%
|
|
|
|
|
Change in Same
Property NOI (accrual basis)
|
|
|
|
By
Region
|
Three Months
Ended
March 31, 2017
|
|
Percentage of
Base Rent
|
Washington,
D.C.
|
2.5%
|
|
33%
|
Maryland
|
3.9%
|
|
30%
|
Northern
Virginia
|
2.9%
|
|
16%
|
Southern
Virginia
|
(4.9)%
|
|
22%
|
By
Type
|
|
|
|
Business Park /
Industrial
|
(4.1)%
|
|
31%
|
Office
|
4.4%
|
|
69%
|
|
|
(1)
|
Same property
comparisons are based upon those consolidated properties owned and
in-service for the entirety of the periods presented. Same property
results for the three months ended March 31, 2017 and 2016 exclude
the operating results of all disposed properties and the results of
the following non-same properties that were owned as of March 31,
2017: Redland I and the NOVA build-to-suit.
|
(2)
|
Includes property
results for Redland I, the NOVA build-to-suit and all properties
that were disposed of prior to March 31, 2017. Also includes an
administrative overhead allocation, which was replaced by a
normalized management fee.
|
(3)
|
Excludes termination
fee income for comparative purposes.
|
(4)
|
Same property
operating expenses have been adjusted to reflect a normalized
management fee in lieu of an administrative overhead allocation for
comparative purposes.
|
Company Contact:
Randy Haugh
Vice President, Finance
(240) 235-5573
rhaugh@first-potomac.com
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/first-potomac-realty-trust-reports-first-quarter-2017-results-300447476.html
SOURCE First Potomac Realty Trust