Maryland | 001-34995 | 27-1712193 |
(State or other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
3284 Northside Parkway NW, Suite 150, Atlanta, Georgia | 30327 |
(Address of Principal Executive Offices) | (Zip Code) |
Registrant's telephone number, including area code: (770) 818-4100 |
_____________________ (Former name or former address, if changed since last report) |
[ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
[ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
[ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
[ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
PREFERRED APARTMENT COMMUNITIES, INC. (Registrant) |
Date: April 30, 2018 | By: | /s/ Jeffrey R. Sprain |
Jeffrey R. Sprain | ||
Executive Vice President, General Counsel and Secretary |
Three months ended March 31, | ||||||||||||
2018 | 2017 | % change | ||||||||||
Revenues (in thousands) | $ | 90,370 | $ | 66,561 | 35.8 | % | ||||||
Per share data: | ||||||||||||
Net income (loss) (1) | $ | (0.14 | ) | $ | 0.54 | — | ||||||
FFO (2) | $ | 0.37 | $ | 0.35 | 5.7 | % | ||||||
AFFO (2) | $ | 0.26 | $ | 0.27 | (3.7 | )% | ||||||
Dividends (3) | $ | 0.25 | $ | 0.22 | 13.6 | % | ||||||
• | For the first quarter 2018, our FFO payout ratio to Common Stockholders and Unitholders was approximately 68.5% and our FFO payout ratio (before the deduction of preferred dividends) to our preferred stockholders was approximately 57.0%.(A) |
• | For the first quarter 2018, our AFFO payout ratio to Common Stockholders and Unitholders was approximately 96.7% and our AFFO payout ratio (before the deduction of preferred dividends) to our preferred stockholders was approximately 65.2%.(A) |
• | For the first quarter 2018, our same store net operating income for our established multifamily communities increased 10.3% as compared to the first quarter 2017. (B) |
• | At March 31, 2018, the market value of our common stock was $14.19. A hypothetical investment in our Common Stock in our initial public offering on April 5, 2011, assuming the reinvestment of all dividends and no transaction costs, would have resulted in an average annual return of approximately 17.3% through March 31, 2018. |
• | As of March 31, 2018, our total assets were approximately $3.4 billion compared to approximately $2.5 billion as of March 31, 2017, an increase of approximately $851 million, or approximately 33.4%. This growth was driven primarily by the acquisition of 18 real estate properties (partially offset by the sale of two properties) and an increase of approximately $74.1 million in the funded amount of our real estate loan investment portfolio since March 31, 2017. |
• | As of March 31, 2018, the average age of our multifamily communities was approximately 5.6 years, which is one of the youngest in the multifamily REIT industry. |
• | Approximately 89.1% of our permanent property-level mortgage debt has fixed interest rates or has variable interest rates which are capped. We believe we are well protected against potential increases in market interest rates. |
• | At March 31, 2018, our leverage, as measured by the ratio of our debt to the undepreciated book value of our total assets, was approximately 53.9%. |
• | Cash flow from operations for the quarter ended March 31, 2018 was approximately $31.4 million, an increase of approximately $13.1 million, or 71.9%, compared to approximately $18.3 million for the quarter ended March 31, 2017. |
• | For the quarter ended March 31, 2018, our physical occupancy for established multifamily communities was 95.1%. |
• | On January 16, 2018, we closed on a real estate loan investment of up to $3.5 million in support of a mixed-use project in North Augusta, South Carolina. On February 13, 2018, we closed on a real estate loan investment of up to $137.6 million in support of a 551-unit multifamily community in San Jose, California. |
• | On March 20, 2018, we sold our oldest multifamily community, Lake Cameron, which is located in Raleigh, North Carolina for approximately $43.5 million, which resulted in an average annual return of 19% from January 23, 2013, the date the property was acquired. |
• | Remediation of property damages due to Hurricane Harvey at our Stone Creek multifamily community located in Port Arthur, Texas is progressing on schedule, and we anticipate full completion by May 2018. For the three-month period ended March 31, 2018, rental revenues decreased approximately $252,000 due to lost rents. During the first quarter, we received proceeds from our insurance company of $588,000 for lost rents, which has been reflected in income for the first quarter 2018. We expect to record a full recovery of the remainder of lost revenues upon settlement with our insurance carrier and receipt of funds later in 2018. |
Property | Location (MSA) | Units | Leasable square feet | ||||||
Multifamily communities: | |||||||||
The Lux at Sorrel | Jacksonville, FL | 265 | n/a | ||||||
Green Park | Atlanta, GA | 310 | n/a | ||||||
Office buildings: | |||||||||
Armour Yards | Atlanta, GA | n/a | 187,000 | ||||||
Owned as of March 31, 2018 | Potential additions from real estate loan investment portfolio (1) | Potential total | ||||||||
Multifamily communities: | ||||||||||
Properties | 31 | 15 | 46 | |||||||
Units | 9,768 | 4,378 | 14,146 | |||||||
Grocery-anchored shopping centers: | ||||||||||
Properties | 39 | — | 39 | |||||||
Gross leasable area (square feet) | 4,055,714 | — | 4,055,714 | |||||||
Student housing properties: | ||||||||||
Properties | 4 | 6 | 10 | |||||||
Units | 891 | 1,457 | 2,348 | |||||||
Beds | 2,950 | 4,145 | 7,095 | |||||||
Office buildings: | ||||||||||
Properties | 5 | — | 5 | |||||||
Rentable square feet | 1,539,000 | — | 1,539,000 | |||||||
(1) We evaluate each project individually and we make no assurance that we will acquire any of the underlying properties from our real estate loan investment portfolio. |
Stoneridge Farms at Hunt Club | Overton Rise | Avenues at Cypress | ||
Vineyards | Aster at Lely | Avenues at Northpointe | ||
McNeil Ranch | Venue at Lakewood Ranch | Stone Rise | ||
Citi Lakes | Lenox Portfolio | Sorrel |
Multifamily Established Communities' Same Store Net Operating Income | |||||||||||||||
Three months ended: | |||||||||||||||
(in thousands) | 3/31/2018 | 3/31/2017 | $ change | % change | |||||||||||
Revenues: | |||||||||||||||
Rental revenues | $ | 13,412 | $ | 12,990 | $ | 422 | 3.2 | % | |||||||
Other property revenues | 1,458 | 1,390 | 68 | 4.9 | % | ||||||||||
Total revenues | 14,870 | 14,380 | 490 | 3.4 | % | ||||||||||
Operating expenses: | |||||||||||||||
Property operating and maintenance | 1,839 | 1,865 | (26 | ) | (1.4 | )% | |||||||||
Payroll | 1,148 | 1,229 | (81 | ) | (6.6 | )% | |||||||||
Property management fees | 599 | 577 | 22 | 3.8 | % | ||||||||||
Real estate taxes | 2,181 | 2,382 | (201 | ) | (8.4 | )% | |||||||||
Other | 610 | 627 | (17 | ) | (2.7 | )% | |||||||||
Total operating expenses | 6,377 | 6,680 | (303 | ) | (4.5 | )% | |||||||||
Same store net operating income | $ | 8,493 | $ | 7,700 | $ | 793 | 10.3 | % |
Reconciliation of Multifamily Established Communities' Same Store Net Operating Income (NOI) to Net Income (Loss) | ||||||||
Three months ended: | ||||||||
(in thousands) | 3/31/2018 | 3/31/2017 | ||||||
Same store net operating income | $ | 8,493 | $ | 7,700 | ||||
Add: | ||||||||
Non-same-store property revenues | 60,936 | 39,419 | ||||||
Less: | ||||||||
Non-same-store property operating expenses | 21,641 | 14,586 | ||||||
Property net operating income | 47,788 | 32,533 | ||||||
Add: | ||||||||
Interest revenue on notes receivable | 10,300 | 7,948 | ||||||
Interest revenue on related party notes receivable | 4,265 | 4,814 | ||||||
Less: | ||||||||
Equity stock compensation | 1,135 | 873 | ||||||
Depreciation and amortization | 40,616 | 24,826 | ||||||
Interest expense | 20,968 | 15,009 | ||||||
Acquisition costs | — | 9 | ||||||
Management fees | 6,241 | 4,513 | ||||||
Insurance, professional fees and other | 704 | 903 | ||||||
Gain on sale of real estate | 20,354 | 30,724 | ||||||
Contingent asset management and general and administrative expense fees | (1,220 | ) | (175 | ) | ||||
Net income (loss) | $ | 14,263 | $ | 30,061 |
Consolidated Statements of Operations | S-2 | |||
Reconciliations of FFO and AFFO to Net Income (Loss) Attributable to Common Stockholders | S-3 | |||
Notes to Reconciliation of FFO and AFFO to Net Income (Loss) Attributable to Common Stockholders | S-4 | |||
Consolidated Balance Sheets | S-6 | |||
Consolidated Statements of Cash Flows | S-7 | |||
Real Estate Loan Investment Portfolio | S-8 | |||
Mortgage Indebtedness | S-10 | |||
Multifamily Communities | S-14 | |||
Capital Expenditures | S-15 | |||
Grocery-Anchored Shopping Center Portfolio | S-16 | |||
Office Building Portfolio | S-17 | |||
Definitions of Non-GAAP Measures | S-18 |
Preferred Apartment Communities, Inc. | ||||||||
Consolidated Statements of Operations | ||||||||
(Unaudited) | ||||||||
Three months ended March 31, | ||||||||
(In thousands, except per-share figures) | 2018 | 2017 | ||||||
Revenues: | ||||||||
Rental revenues | $ | 64,077 | $ | 45,363 | ||||
Other property revenues | 11,728 | 8,436 | ||||||
Interest income on loans and notes receivable | 10,300 | 7,948 | ||||||
Interest income from related parties | 4,265 | 4,814 | ||||||
Total revenues | 90,370 | 66,561 | ||||||
Operating expenses: | ||||||||
Property operating and maintenance | 8,805 | 6,539 | ||||||
Property salary and benefits | 3,899 | 3,028 | ||||||
Property management fees | 2,756 | 1,902 | ||||||
Real estate taxes | 9,975 | 7,904 | ||||||
General and administrative | 1,841 | 1,505 | ||||||
Equity compensation to directors and executives | 1,135 | 873 | ||||||
Depreciation and amortization | 40,616 | 24,826 | ||||||
Acquisition and pursuit costs | — | 9 | ||||||
Asset management and general and administrative expense | ||||||||
fees to related party | 6,241 | 4,513 | ||||||
Insurance, professional fees, and other expenses | 1,445 | 1,291 | ||||||
Total operating expenses | 76,713 | 52,390 | ||||||
Contingent asset management and general and administrative | ||||||||
expense fees | (1,220 | ) | (175 | ) | ||||
Net operating expenses | 75,493 | 52,215 | ||||||
Operating income | 14,877 | 14,346 | ||||||
Interest expense | 20,968 | 15,009 | ||||||
Net income (loss) before gain on sale of real estate | (6,091 | ) | (663 | ) | ||||
Gain on sale of real estate | 20,354 | 30,724 | ||||||
Net income | 14,263 | 30,061 | ||||||
Consolidated net (income) attributable to non-controlling interests | (380 | ) | (999 | ) | ||||
Net income attributable to the Company | 13,883 | 29,062 | ||||||
Dividends declared to preferred stockholders | (19,517 | ) | (14,386 | ) | ||||
Earnings attributable to unvested restricted stock | (2 | ) | (1 | ) | ||||
Net (loss) income attributable to common stockholders | $ | (5,636 | ) | $ | 14,675 | |||
Net (loss) income per share of Common Stock available to common stockholders, | ||||||||
basic and diluted | $ | (0.14 | ) | $ | 0.54 | |||
Dividends per share declared on Common Stock | $ | 0.25 | $ | 0.22 | ||||
Weighted average number of shares of Common Stock outstanding, | ||||||||
basic and diluted | 39,098 | 26,936 |
Reconciliation of FFO and AFFO | |||||||||||
to Net (Loss) Income Attributable to Common Stockholders (A) | |||||||||||
Three months ended March 31, | |||||||||||
(In thousands, except per-share figures) | 2018 | 2017 | |||||||||
Net (loss) income attributable to common stockholders (See note 1) | $ | (5,636 | ) | $ | 14,675 | ||||||
Add: | Depreciation of real estate assets | 27,712 | 18,131 | ||||||||
Amortization of acquired real estate intangible assets and deferred leasing costs | 12,591 | 6,532 | |||||||||
Income attributable to non-controlling interests (See note 2) | 380 | 999 | |||||||||
Less: | Gain on sale of real estate | (20,354 | ) | (30,724 | ) | ||||||
FFO | 14,693 | 9,613 | |||||||||
Add: | Acquisition and pursuit costs | — | 9 | ||||||||
Loan cost amortization on acquisition term note (See note 3) | 25 | 27 | |||||||||
Amortization of loan coordination fees paid to the Manager (See note 4) | 476 | 356 | |||||||||
Mortgage loan refinancing and extinguishment costs | 41 | — | |||||||||
Insurance recovery in excess of weather-related property operating losses (See note 5) | (260 | ) | — | ||||||||
Non-cash equity compensation to directors and executives | 1,135 | 873 | |||||||||
Amortization of loan closing costs (See note 6) | 1,045 | 798 | |||||||||
Depreciation/amortization of non-real estate assets | 313 | 163 | |||||||||
Net loan fees received (See note 7) | 800 | — | |||||||||
Accrued interest income received (See note 8) | 1,343 | 2,524 | |||||||||
Deemed dividends from cash redemptions of preferred stock | 318 | — | |||||||||
Non-cash dividends on Series M Preferred Stock | 106 | — | |||||||||
Amortization of lease inducements (See note 9) | 257 | — | |||||||||
Less: | Non-cash loan interest income (See note 8) | (4,932 | ) | (4,299 | ) | ||||||
Cash paid for loan closing costs | (391 | ) | — | ||||||||
Amortization of acquired above and below market lease intangibles | |||||||||||
and straight-line rental revenues (See note 10) | (3,189 | ) | (1,817 | ) | |||||||
Amortization of deferred revenues (See note 11) | (497 | ) | — | ||||||||
Normally recurring capital expenditures and leasing costs (See note 12) | (874 | ) | (846 | ) | |||||||
AFFO | $ | 10,409 | $ | 7,401 | |||||||
Common Stock dividends and distributions to Unitholders declared: | |||||||||||
Common Stock dividends | $ | 9,802 | $ | 5,971 | |||||||
Distributions to Unitholders (See note 2) | 268 | 198 | |||||||||
Total | $ | 10,070 | $ | 6,169 | |||||||
Common Stock dividends and Unitholder distributions per share | $ | 0.25 | $ | 0.22 | |||||||
FFO per weighted average basic share of Common Stock and Unit outstanding | $ | 0.37 | $ | 0.35 | |||||||
AFFO per weighted average basic share of Common Stock and Unit outstanding | $ | 0.26 | $ | 0.27 | |||||||
Weighted average shares of Common Stock and Units outstanding: (A) | |||||||||||
Basic: | |||||||||||
Common Stock | 39,098 | 26,936 | |||||||||
Class A Units | 1,070 | 926 | |||||||||
Common Stock and Class A Units | 40,168 | 27,862 | |||||||||
Diluted Common Stock and Class A Units (B) | 41,226 | 28,786 | |||||||||
Actual shares of Common Stock outstanding, including 6 and 8 unvested shares | |||||||||||
of restricted Common Stock at March 31, 2018 and 2017, respectively | 39,215 | 27,193 | |||||||||
Actual Class A Units outstanding at March 31, 2018 and 2017, respectively. | 1,070 | 903 | |||||||||
Total | 40,285 | 28,096 | |||||||||
(A) Units and Unitholders refer to Class A Units in our Operating Partnership, or Class A Units, and holders of Class A Units, respectively. Unitholders include recipients of awards of Class B Units in our Operating Partnership, or Class B Units, for annual service which became vested and earned and automatically converted to Class A Units. Unitholders also include the entity that contributed the Wade Green grocery-anchored shopping center. The Class A Units collectively represent an approximate 2.66% weighted average non-controlling interest in the Operating Partnership for the three-month period ended March 31, 2018. | |||||||||||
(B) Since our FFO and AFFO results are positive for the periods reflected above, we are presenting recalculated diluted weighted average shares of Common Stock and Class A Units for these periods for purposes of this table, which includes the dilutive effect of common stock equivalents from grants of the Class B Units, warrants included in units of Series A Preferred Stock issued, as well as annual grants of restricted Common Stock. The weighted average shares of Common Stock outstanding presented on the Consolidated Statements of Operations are the same for basic and diluted for any period for which we recorded a net loss available to common stockholders, excluding any gains from sales of real estate assets. |
1) | Rental and other property revenues and property operating expenses for the quarter ended March 31, 2018 include activity for the two multifamily communities and one office building acquired during the quarter only from their respective dates of acquisition. In addition, the first quarter 2018 period includes a full quarter of activity for the six multifamily communities, eight grocery-anchored shopping centers, two student housing properties and one office building acquired during the second, third and fourth quarters 2017. Rental and other property revenues and expenses for the first quarter 2017 include activity for the acquisitions made during that period only from their respective dates of acquisition. |
2) | Non-controlling interests in our Operating Partnership consisted of a total of 1,070,103 Class A Units as of March 31, 2018. Included in this total are 419,228 Class A Units which were granted as partial consideration to the seller in conjunction with the seller's contribution to us on February 29, 2016 of the Wade Green grocery-anchored shopping center. The remaining Class A units were awarded primarily to our key executive officers. The Class A Units are apportioned a percentage of our financial results as non-controlling interests. The weighted average ownership percentage of these holders of Class A Units was calculated to be 2.67% and 3.32% for the three-month periods ended March 31, 2018 and 2017, respectively. |
3) | We incurred loan closing costs for the $11 million term note, which we used to finance the acquisition of our Anderson Central grocery-anchored shopping center, and on our $200 million acquisition revolving credit facility, or Acquisition Facility, which is used to finance acquisitions of multifamily communities and student housing communities. The costs to establish these instruments were deferred and amortized over the lives of the instruments. The amortization expense of these deferred costs is an additive adjustment in the calculation of AFFO. |
4) | As of January 1, 2016, we pay loan coordination fees to Preferred Apartment Advisors, LLC, our Manager, related to obtaining mortgage financing for acquired properties. Loan coordination fees were introduced to reflect the administrative effort involved in arranging debt financing for acquired properties. The portion of the loan coordination fees paid up until July 1, 2017 attributable to the financing were amortized over the lives of the respective mortgage loans, and this non-cash amortization expense is an addition to FFO in the calculation of AFFO. Beginning effective July 1, 2017, the loan coordination fee was lowered from 1.6% to 0.6% of the amount of any mortgage indebtedness on newly-acquired properties or refinancing. All of the loan coordination fees paid to our Manager subsequent to July 1, 2017 are amortized over the life of the debt. At March 31, 2018, aggregate unamortized loan coordination fees were approximately $12.4 million, which will be amortized over a weighted average remaining loan life of approximately 10.5 years. |
5) | We sustained weather-related operating losses due to Hurricane Harvey at our Stone Creek multifamily community during the first quarter 2018; these costs are added back to FFO in our calculation of AFFO. Included in these adjustments are the receipt from our insurance carrier during the first quarter 2018 of claims proceeds for lost rental revenues incurred during the third and fourth quarters of 2017 that totaled approximately $588,000, which was recognized in our statements of operations for the first quarter 2018. |
6) | We incur loan closing costs on our existing mortgage loans, which are secured on a property-by-property basis by each of our acquired real estate assets, and also for occasional amendments to our syndicated revolving line of credit with Key Bank National Association, or our Revolving Line of Credit. On March 23, 2018, but effective April 13, 2018, the maximum borrowing capacity on the Revolving Line of Credit was increased from $150 million to $200 million. These loan closing costs are also amortized over the lives of the respective loans and the Revolving Line of Credit, and this non-cash amortization expense is an addition to FFO in the calculation of AFFO. Neither we nor the Operating Partnership have any recourse liability in connection with any of the mortgage loans, nor do we have any cross-collateralization arrangements with respect to the assets securing the mortgage loans, other than security interests in 49% of the equity interests of the subsidiaries owning such assets, granted in connection with our Revolving Line of Credit, which provides for full recourse liability. At March 31, 2018, aggregate unamortized loan costs were approximately $19.8 million, which will be amortized over a weighted average remaining loan life of approximately 7.9 years. |
7) | We receive loan origination fees in conjunction with the origination of certain real estate loan investments. These fees are then recognized as revenue over the lives of the applicable loans as adjustments of yield using the effective interest method. The total fees received after the payment of loan origination fees to our Manager are additive adjustments in the calculation of AFFO. Correspondingly, the amortized non-cash income is a deduction in the calculation of AFFO. Over the lives of certain loans, we accrue additional interest amounts that become due to us at the time of repayment of the loan or refinancing of the property, or when the property is sold. This non-cash interest income is subtracted from FFO in our calculation of AFFO. |
8) | This adjustment reflects the receipt during the periods presented of additional interest income (described in note 7 above) which was earned and accrued prior to those periods presented on various real estate loans. |
9) | This adjustment removes the non-cash amortization of costs incurred to induce tenants to lease space in our office buildings and grocery-anchored shopping centers. |
10) | This adjustment reflects straight-line rent adjustments and the reversal of the non-cash amortization of below-market and above-market lease intangibles, which were recognized in conjunction with our acquisitions and which are amortized over the estimated average remaining lease terms from the acquisition date for multifamily communities and over the remaining lease terms for grocery-anchored |
11) | This adjustment removes the non-cash amortization of deferred revenue recorded by us in conjunction with Company-owned lessee-funded tenant improvements in our office buildings. |
12) | We deduct from FFO normally recurring capital expenditures that are necessary to maintain our assets’ revenue streams in the calculation of AFFO. This adjustment also deducts from FFO capitalized amounts for third party costs during the period to originate or renew leases in our grocery-anchored shopping centers and office buildings. No adjustment is made in the calculation of AFFO for nonrecurring capital expenditures. See Capital Expenditures, Grocery-Anchored Shopping Center Portfolio, and Office Buildings Portfolio sections for definitions of these terms. |
Preferred Apartment Communities, Inc. | |||||||||
Consolidated Balance Sheets | |||||||||
(Unaudited) | |||||||||
(In thousands, except per-share par values) | March 31, 2018 | December 31, 2017 | |||||||
Assets | |||||||||
Real estate | |||||||||
Land | $ | 422,361 | $ | 406,794 | |||||
Building and improvements | 2,146,135 | 2,043,853 | |||||||
Tenant improvements | 75,531 | 63,425 | |||||||
Furniture, fixtures, and equipment | 225,553 | 210,779 | |||||||
Construction in progress | 13,420 | 10,491 | |||||||
Gross real estate | 2,883,000 | 2,735,342 | |||||||
Less: accumulated depreciation | (193,141 | ) | (172,756 | ) | |||||
Net real estate | 2,689,859 | 2,562,586 | |||||||
Real estate loan investments, net of deferred fee income | 278,258 | 255,345 | |||||||
Real estate loan investments to related parties, net | 134,786 | 131,451 | |||||||
Total real estate and real estate loan investments, net | 3,102,903 | 2,949,382 | |||||||
Cash and cash equivalents | 19,711 | 21,043 | |||||||
Restricted cash | 47,683 | 51,969 | |||||||
Notes receivable | 12,174 | 17,318 | |||||||
Note receivable and revolving line of credit due from related party | 28,020 | 22,739 | |||||||
Accrued interest receivable on real estate loans | 29,693 | 26,865 | |||||||
Acquired intangible assets, net of amortization | 100,276 | 102,743 | |||||||
Deferred loan costs on Revolving Line of Credit, net of amortization | 1,578 | 1,385 | |||||||
Deferred offering costs | 7,374 | 6,544 | |||||||
Tenant lease inducements, net | 16,318 | 14,425 | |||||||
Tenant receivables and other assets | 28,444 | 37,957 | |||||||
Total assets | $ | 3,394,174 | $ | 3,252,370 | |||||
Liabilities and equity | |||||||||
Liabilities | |||||||||
Mortgage notes payable, net of deferred loan costs | $ | 1,871,966 | $ | 1,776,652 | |||||
Revolving line of credit | 13,200 | 41,800 | |||||||
Term note payable, net of deferred loan costs | — | 10,994 | |||||||
Real estate loan investment participation obligation | 10,798 | 13,986 | |||||||
Deferred revenue | 31,053 | 27,947 | |||||||
Accounts payable and accrued expenses | 33,053 | 31,253 | |||||||
Accrued interest payable | 5,472 | 5,028 | |||||||
Dividends and partnership distributions payable | 16,460 | 15,680 | |||||||
Acquired below market lease intangibles, net of amortization | 38,991 | 38,857 | |||||||
Security deposits and other liabilities | 12,349 | 9,407 | |||||||
Total liabilities | 2,033,342 | 1,971,604 | |||||||
Commitments and contingencies | |||||||||
Equity | |||||||||
Stockholders' equity | |||||||||
Series A Redeemable Preferred Stock, $0.01 par value per share; 3,050 | |||||||||
shares authorized; 1,348 and 1,250 shares issued; 1,313 and 1,222 | |||||||||
shares outstanding at March 31, 2018 and December 31, 2017, respectively | 13 | 12 | |||||||
Series M Redeemable Preferred Stock, $0.01 par value per share; 500 | |||||||||
shares authorized; 20 and 15 shares issued and outstanding | |||||||||
at March 31, 2018 and December 31, 2017, respectively | — | — | |||||||
Common Stock, $0.01 par value per share; 400,067 shares authorized; | |||||||||
39,208 and 38,565 shares issued and outstanding at | |||||||||
March 31, 2018 and December 31, 2017, respectively | 392 | 386 | |||||||
Additional paid-in capital | 1,357,725 | 1,271,040 | |||||||
Accumulated earnings | — | 4,449 | |||||||
Total stockholders' equity | 1,358,130 | 1,275,887 | |||||||
Non-controlling interest | 2,702 | 4,879 | |||||||
Total equity | 1,360,832 | 1,280,766 | |||||||
Total liabilities and equity | $ | 3,394,174 | $ | 3,252,370 |
Preferred Apartment Communities, Inc. | ||||||||
Consolidated Statements of Cash Flows | ||||||||
(Unaudited) | ||||||||
Three months ended March 31, | ||||||||
(In thousands) | 2018 | 2017 | ||||||
Operating activities: | ||||||||
Net income (loss ) | $ | 14,263 | $ | 30,061 | ||||
Reconciliation of net income (loss) to net cash provided by operating activities: | ||||||||
Depreciation expense | 27,990 | 18,288 | ||||||
Amortization expense | 12,626 | 6,539 | ||||||
Amortization of above and below market leases | (1,178 | ) | (798 | ) | ||||
Deferred revenues and fee income amortization | (943 | ) | (284 | ) | ||||
Amortization of market discount on assumed debt and lease incentives | 323 | — | ||||||
Deferred loan cost amortization | 1,480 | 1,180 | ||||||
(Increase) in accrued interest income on real estate loans | (2,828 | ) | (1,546 | ) | ||||
Equity compensation to executives and directors | 1,135 | 873 | ||||||
Gain on sale of real estate | (20,354 | ) | (30,724 | ) | ||||
Other | — | 187 | ||||||
Changes in operating assets and liabilities: | ||||||||
(Increase) in tenant receivables and other assets | 625 | (1,965 | ) | |||||
(Increase) in tenant lease incentives | (2,149 | ) | (2,913 | ) | ||||
Increase in accounts payable and accrued expenses | (1,074 | ) | (716 | ) | ||||
Increase in accrued interest, prepaid rents and other liabilities | 1,502 | 95 | ||||||
Net cash provided by operating activities | 31,418 | 18,277 | ||||||
Investing activities: | ||||||||
Investment in real estate loans | (68,929 | ) | (16,272 | ) | ||||
Repayments of real estate loans | 42,312 | 9,866 | ||||||
Notes receivable issued | (472 | ) | (1,263 | ) | ||||
Notes receivable repaid | 5,618 | — | ||||||
Note receivable issued to and draws on line of credit by related party | (14,419 | ) | (7,650 | ) | ||||
Repayments of line of credit by related party | 9,034 | 7,554 | ||||||
Loan origination fees received | 1,600 | — | ||||||
Loan origination fees paid to Manager | (800 | ) | — | |||||
Acquisition of properties | (170,072 | ) | (138,298 | ) | ||||
Disposition of properties, net | 42,266 | 76,368 | ||||||
Increase in cash held in like-kind exchange | — | 3,761 | ||||||
Receipt of insurance proceeds for capital improvements | 412 | — | ||||||
Additions to real estate assets - improvements | (7,637 | ) | (3,680 | ) | ||||
(Deposits) on acquisitions | 4,021 | (1,838 | ) | |||||
Net cash used in investing activities | (157,066 | ) | (71,452 | ) | ||||
Financing activities: | ||||||||
Proceeds from mortgage notes payable | 123,275 | 104,300 | ||||||
Payments for mortgage notes payable | (27,350 | ) | (67,141 | ) | ||||
Payments for deposits and other mortgage loan costs | (1,733 | ) | (3,399 | ) | ||||
Proceeds from real estate loan participants | 5 | 82 | ||||||
Payments to real estate loan participants | (3,314 | ) | (2,467 | ) | ||||
Proceeds from lines of credit | 86,200 | 37,500 | ||||||
Payments on lines of credit | (114,800 | ) | (68,000 | ) | ||||
Repayment of the Term Loan | (11,000 | ) | — | |||||
Proceeds from sales of Units, net of offering costs and redemptions | 87,490 | 68,987 | ||||||
Proceeds from sales of Common Stock | — | 186 | ||||||
Proceeds from exercises of warrants | 11,169 | 4,249 | ||||||
Common Stock dividends paid | (9,576 | ) | (5,741 | ) | ||||
Preferred stock dividends paid | (18,963 | ) | (13,961 | ) | ||||
Distributions to non-controlling interests | (221 | ) | (195 | ) | ||||
Payments for deferred offering costs | (1,152 | ) | (2,126 | ) | ||||
Net cash provided by financing activities | 120,030 | 52,274 | ||||||
Net increase in cash, cash equivalents and restricted cash | (5,618 | ) | (901 | ) | ||||
Cash, cash equivalents and restricted cash, beginning of period | 73,012 | 67,715 | ||||||
Cash, cash equivalents and restricted cash, end of period | $ | 67,394 | $ | 66,814 |
Project/Property | Location | Maturity date | Optional extension date | Total loan commitments | Carrying amount (1) as of | Current / deferred interest % per annum | ||||||||||||||
March 31, 2018 | December 31, 2017 | |||||||||||||||||||
Multifamily communities: | (in thousands) | |||||||||||||||||||
Encore | Atlanta, GA | 4/8/2019 | 10/8/2020 | $ | 10,958 | $ | 10,958 | $ | 10,958 | 8.5 / 5 | ||||||||||
Encore Capital | Atlanta, GA | 4/8/2019 | 10/8/2020 | 9,758 | 7,723 | 7,521 | 8.5 / 5 | |||||||||||||
Palisades | Northern VA | 5/17/2018 (2) | N/A | 17,270 | 17,132 | 17,111 | 8 / 5 | |||||||||||||
Fusion | Irvine, CA | 5/31/2018 | 5/31/2020 | 70,835 | 65,981 | 58,447 | 8.5 / 7.5 | |||||||||||||
Green Park | Atlanta, GA | 2/28/2018 | 12/1/2019 | 13,464 | — | 11,464 | 8.5 / 5.83 | |||||||||||||
Bishop Street | Atlanta, GA | 2/18/2020 | N/A | 12,693 | 12,405 | 12,145 | 8.5 / 6.5 | |||||||||||||
Hidden River | Tampa, FL | 12/3/2018 | 12/3/2020 | 4,735 | 4,735 | 4,735 | 8.5 / 6.5 | |||||||||||||
Hidden River Capital | Tampa, FL | 12/4/2018 | 12/4/2020 | 5,380 | 5,149 | 5,041 | 8.5 / 6.5 | |||||||||||||
CityPark II | Charlotte, NC | 1/7/2019 | 1/7/2021 | 3,365 | 3,365 | 3,365 | 8.5 / 6.5 | |||||||||||||
CityPark II Capital | Charlotte, NC | 1/8/2019 | 1/31/2021 | 3,916 | 3,702 | 3,624 | 8.5 / 6.5 | |||||||||||||
Park 35 on Clairmont | Birmingham, AL | 6/26/2018 | 6/26/2020 | 21,060 | 21,060 | 21,060 | 8.5 / 2 | |||||||||||||
Wiregrass | Tampa, FL | 5/15/2020 | 5/15/2023 | 14,976 | 13,250 | 12,972 | 8.5 / 6.5 | |||||||||||||
Wiregrass Capital | Tampa, FL | 5/15/2020 | 5/15/2023 | 3,744 | 3,637 | 3,561 | 8.5 / 6.5 | |||||||||||||
Berryessa | San Jose, CA | 4/19/2018 | N/A | 31,509 | — | 30,571 | 10.5 / 0 | |||||||||||||
Berryessa | San Jose, CA | 2/13/2021 | 2/13/2023 | 137,616 | 34,563 | — | 8.5 / 6.0 | |||||||||||||
Brentwood | Nashville, TN | 6/1/2018 | N/A | 2,376 | 2,329 | 2,261 | 12 / 0 | |||||||||||||
Fort Myers | Fort Myers, FL | 2/3/2021 | 2/3/2022 | 9,416 | 7,461 | 3,521 | 8.5 / 5.5 | |||||||||||||
Fort Myers Capital | Fort Myers, FL | 2/3/2021 | 2/3/2022 | 6,193 | 5,101 | 4,994 | 8.5 / 5.5 | |||||||||||||
360 Forsyth | Atlanta, GA | 7/11/2020 | 7/11/2022 | 22,412 | 18,342 | 13,400 | 8.5 / 5.5 | |||||||||||||
Morosgo | Atlanta, GA | 1/31/2021 | 1/31/2022 | 11,749 | 9,269 | 4,951 | 8.5 / 5.5 | |||||||||||||
Morosgo Capital | Atlanta, GA | 1/31/2021 | 1/31/2022 | 6,176 | 4,863 | 4,761 | 8.5 / 5.5 | |||||||||||||
University City Gateway | Charlotte, NC | 8/15/2021 | 8/15/2022 | 10,336 | 2,968 | 850 | 8.5 / 5 | |||||||||||||
University City Gateway | ||||||||||||||||||||
Capital | Charlotte, NC | 8/18/2021 | 8/18/2022 | 7,338 | 5,652 | 5,530 | 8.5 / 5 | |||||||||||||
Student housing properties: | ||||||||||||||||||||
Haven 12 | Starkville, MS | 12/17/2018 | 11/30/2020 | 6,116 | 6,116 | 5,816 | 8.5 / 0 | |||||||||||||
Haven46 | Tampa, FL | 3/29/2019 | 9/29/2020 | 9,820 | 9,820 | 9,820 | 8.5 / 5 | |||||||||||||
Haven Northgate | College Station, TX | 6/20/2019 | 6/20/2020 | 67,680 | 66,644 | 65,724 | (3) / 1.5 | |||||||||||||
Lubbock II | Lubbock, TX | 4/20/2019 | N/A | 9,857 | 9,635 | 9,357 | 8.5 / 0 | |||||||||||||
Haven Charlotte | Charlotte, NC | 12/22/2019 | 12/22/2021 | 19,582 | 18,242 | 17,039 | 8.5 / 6.5 | |||||||||||||
Haven Charlotte Member | Charlotte, NC | 12/22/2019 | 12/22/2021 | 8,201 | 7,978 | 7,795 | 8.5 / 6.5 | |||||||||||||
Solis Kennesaw | Atlanta, GA | 9/26/2020 | 9/26/2022 | 12,359 | 6,896 | 1,610 | 8.5 / 5.5 | |||||||||||||
Solis Kennesaw Capital | Atlanta, GA | 10/1/2020 | 10/1/2022 | 8,360 | 7,298 | 7,145 | 8.5 / 5.5 | |||||||||||||
New Market Properties: | ||||||||||||||||||||
Dawson Marketplace | Atlanta, GA | 9/24/2020 | 9/24/2022 | 12,857 | 12,857 | 12,857 | 8.5 / 6.9 (4) | |||||||||||||
Other: | ||||||||||||||||||||
Crescent Avenue | Atlanta, GA | 4/13/2018 | 5/31/2018 | 8,500 | 8,500 | 8,500 | 10 / 5 | |||||||||||||
North Augusta Ballpark | North Augusta, SC | 1/15/2021 | 1/15/2024 | 3,500 | 1,492 | — | 9 / 6 | |||||||||||||
$ | 604,107 | 415,123 | 388,506 | |||||||||||||||||
Unamortized loan origination fees | (2,079 | ) | (1,710 | ) | ||||||||||||||||
Carrying amount | $ | 413,044 | $ | 386,796 | ||||||||||||||||
(1) Carrying amounts presented per loan are amounts drawn, exclusive of deferred fee revenue. | ||||||||||||||||||||
(2) Effective April 13, 2018, the maturity date was extended to May 17, 2019. | ||||||||||||||||||||
(3) The current interest rate on the Haven Northgate loan is a variable rate of 600 basis points over LIBOR. | ||||||||||||||||||||
(4) Effective January 1, 2018, the deferred interest rate increased to 6.9% per annum until the accumulated accrued interest balance reaches $250, at which point the deferred interest rate reverts to 5.0%. |
Total units upon | Purchase option window | ||||||||
Project/Property | Location | completion (1) | Begin | End | |||||
Multifamily communities: | |||||||||
Encore | Atlanta, GA | 339 | 9/30/2018 | 12/31/2018 | |||||
Palisades | Northern VA | 304 | 1/1/2019 | 5/31/2019 | |||||
Fusion | Irvine, CA | 280 | 10/1/2018 | 1/1/2019 | |||||
Bishop Street | Atlanta, GA | 232 | 10/1/2018 | 12/31/2018 | |||||
Hidden River | Tampa, FL | 300 | 9/1/2018 | 12/31/2018 | |||||
CityPark II | Charlotte, NC | 200 | 9/30/2018 | 12/31/2018 | |||||
Park 35 on Clairmont | Birmingham, AL | 271 | S + 90 days (2) | S + 150 days (2) | |||||
Fort Myers | Fort Myers, FL | 224 | S + 90 days (2) | S + 150 days (2) | |||||
Wiregrass | Tampa, FL | 392 | S + 90 days (2) | S + 150 days (2) | |||||
360 Forsyth | Atlanta, GA | 356 | S + 90 days (2) | S + 150 days (2) | |||||
Morosgo | Atlanta, GA | 258 | S + 90 days (2) | S + 150 days (2) | |||||
University City Gateway | Charlotte, NC | 338 | S + 90 days (2) | S + 150 days (2) | |||||
Berryessa | San Jose, CA | 551 | N/A | N/A | |||||
Brentwood | Nashville, TN | 301 | N/A | N/A | |||||
North Augusta Ballpark | North Augusta, SC | 32 | N/A | N/A | |||||
Student housing properties: | |||||||||
Haven 12 | Starkville, MS | 152 | 4/1/2019 | 6/30/2019 | |||||
Haven46 | Tampa, FL | 158 | 11/1/2018 | 1/31/2019 | |||||
Haven Northgate | College Station, TX | 427 | 10/1/2018 | 12/31/2018 | |||||
Lubbock II | Lubbock, TX | 140 | 11/1/2018 | 1/31/2019 | |||||
Haven Charlotte | Charlotte, NC | 332 | 12/1/2019 | 2/28/2020 | |||||
Solis Kennesaw | Atlanta, GA | 248 | (3) | (3) | |||||
5,835 | |||||||||
(1) We evaluate each project individually and we make no assurance that we will acquire any of the underlying properties from our real estate loan investment portfolio. The Berryessa and North Augusta Ballpark projects do not include exclusive purchase options, but we hold a Right of First Offer on these projects at prices acceptable to us and the developer. The Brentwood project is a land acquisition bridge loan and does not include any exclusive purchase right as of March 31, 2018. | |||||||||
(2) The option period window begins and ends at the number of days indicated beyond the achievement of a 93% physical occupancy rate by the underlying property. | |||||||||
(3) The option period begins on October 1 of the second academic year following project completion and ends on the following December 31. The developer may elect to expedite the option period to begin December 1, 2019 and end on December 31, 2019. |
Principal balance as of | Interest only through date (1) | |||||||||||||||||
Acquisition/ refinancing date | March 31, 2018 | December 31, 2017 | Maturity date | Interest rate | Basis point spread over 1 Month LIBOR | |||||||||||||
Multifamily communities: | (in thousands) | |||||||||||||||||
Stone Rise | 7/3/2014 | $ | 23,798 | $ | 23,939 | 8/1/2019 | 2.89 | % | Fixed rate | 8/31/2015 | ||||||||
Summit Crossing | 10/31/2017 | 38,848 | 39,019 | 11/1/2024 | 3.99 | % | Fixed rate | N/A | ||||||||||
Summit Crossing II | 3/20/2014 | 13,357 | 13,357 | 4/1/2021 | 4.49 | % | Fixed rate | 4/30/2019 | ||||||||||
McNeil Ranch | 1/24/2013 | 13,621 | 13,646 | 2/1/2020 | 3.13 | % | Fixed rate | 2/28/2018 | ||||||||||
Lake Cameron | 1/24/2013 | — | (2) | 19,773 | 2/1/2020 | 3.13 | % | Fixed rate | 2/28/2018 | |||||||||
Stoneridge | 9/26/2014 | 25,982 | 26,136 | 10/1/2019 | 3.18 | % | Fixed rate | N/A | ||||||||||
Vineyards | 9/26/2014 | 34,512 | 34,672 | 10/1/2021 | 3.68 | % | Fixed rate | 10/31/2017 | ||||||||||
Avenues at Cypress | 2/13/2015 | 21,555 | 21,675 | 9/1/2022 | 3.43 | % | Fixed rate | N/A | ||||||||||
Avenues at Northpointe | 2/13/2015 | 27,324 | 27,467 | 3/1/2022 | 3.16 | % | Fixed rate | 3/31/2017 | ||||||||||
Venue at Lakewood Ranch | 5/21/2015 | 29,190 | 29,348 | 12/1/2022 | 3.55 | % | Fixed rate | N/A | ||||||||||
Aster at Lely | 6/24/2015 | 32,305 | 32,471 | 7/5/2022 | 3.84 | % | Fixed rate | N/A | ||||||||||
CityPark View | 6/30/2015 | 20,920 | 21,038 | 7/1/2022 | 3.27 | % | Fixed rate | N/A | ||||||||||
Avenues at Creekside | 7/31/2015 | 40,317 | 40,523 | 8/1/2024 | 3.48 | % | 160 | (3) | 8/31/2016 | |||||||||
Citi Lakes | 9/3/2015 | 42,176 | 42,396 | 4/1/2023 | 4.05 | % | 217 | (4) | N/A | |||||||||
Stone Creek | 6/22/2017 | 20,386 | 20,467 | 7/1/2052 | 3.22 | % | Fixed rate | N/A | ||||||||||
Lenox Village Town Center | 12/21/2015 | 29,824 | 30,009 | 5/1/2019 | 3.82 | % | Fixed rate | N/A | ||||||||||
Lenox Village III | 12/21/2015 | 17,717 | 17,802 | 1/1/2023 | 4.04 | % | Fixed rate | N/A | ||||||||||
Overton Rise | 2/1/2016 | 39,788 | 39,981 | 8/1/2026 | 3.98 | % | Fixed rate | N/A | ||||||||||
Baldwin Park | 1/5/2016 | 77,800 | 77,800 | 1/5/2019 | 4.18 | % | 230 | 1/4/2019 | ||||||||||
Crosstown Walk | 1/15/2016 | 31,332 | 31,486 | 2/1/2023 | 3.90 | % | Fixed rate | N/A | ||||||||||
525 Avalon Park | 6/15/2017 | 66,614 | 66,912 | 7/1/2024 | 3.98 | % | Fixed rate | N/A | ||||||||||
City Vista | 7/1/2016 | 34,900 | 35,073 | 7/1/2026 | 3.68 | % | Fixed rate | N/A | ||||||||||
Sorrel | 8/24/2016 | 32,633 | 32,801 | 9/1/2023 | 3.44 | % | Fixed rate | N/A | ||||||||||
Citrus Village | 3/3/2017 | 29,827 | 29,970 | 6/10/2023 | 3.65 | % | Fixed rate | 6/09/2017 | ||||||||||
Retreat at Greystone | 11/21/2017 | 35,066 | 35,210 | 12/1/2024 | 4.31 | % | Fixed rate | N/A | ||||||||||
Founders Village | 3/31/2017 | 31,138 | 31,271 | 4/1/2027 | 4.31 | % | Fixed rate | N/A | ||||||||||
Claiborne Crossing | 4/26/2017 | 26,697 | 26,801 | 6/1/2054 | 2.89 | % | Fixed rate | N/A | ||||||||||
Luxe at Lakewood Ranch | 7/26/2017 | 38,891 | 39,066 | 8/1/2027 | 3.93 | % | Fixed rate | N/A | ||||||||||
Adara at Overland Park | 9/27/2017 | 31,618 | 31,760 | 4/1/2028 | 3.90 | % | Fixed rate | N/A | ||||||||||
Aldridge at Town Village | 10/31/2017 | 37,688 | 37,847 | 11/1/2024 | 4.19 | % | Fixed rate | (5) | N/A | |||||||||
Reserve at Summit Crossing | 9/29/2017 | 19,925 | 20,017 | 10/1/2024 | 3.87 | % | Fixed rate | N/A |
Table continued from previous page | Principal balance as of | Interest only through date (1) | ||||||||||||||||
Acquisition/ refinancing date | March 31, 2018 | December 31, 2017 | Maturity date | Interest rate | Basis point spread over 1 Month LIBOR | |||||||||||||
Overlook at Crosstown Walk | 11/21/2017 | 22,134 | 22,231 | 12/1/2024 | 3.95 | % | Fixed rate | N/A | ||||||||||
Colony at Centerpointe | 12/20/2017 | 33,243 | 33,346 | 10/1/2026 | 3.68 | % | Fixed rate | N/A | ||||||||||
Lux at Sorrel | 1/9/2018 | 31,479 | — | 2/1/2030 | 3.91 | % | Fixed rate | N/A | ||||||||||
Green Park | 2/28/2018 | 39,750 | — | 3/10/2028 | 4.09 | % | Fixed rate | N/A | ||||||||||
Total multifamily communities | 1,092,355 | 1,045,310 | ||||||||||||||||
Grocery-anchored shopping centers: | ||||||||||||||||||
Spring Hill Plaza | 9/5/2014 | 9,418 | 9,470 | 10/1/2019 | 3.36 | % | Fixed rate | 10/31/2015 | ||||||||||
Parkway Town Centre | 9/5/2014 | 6,850 | 6,887 | 10/1/2019 | 3.36 | % | Fixed rate | 10/31/2015 | ||||||||||
Woodstock Crossing | 8/8/2014 | 2,976 | 2,989 | 9/1/2021 | 4.71 | % | Fixed rate | N/A | ||||||||||
Deltona Landings | 9/30/2014 | 6,739 | 6,778 | 10/1/2019 | 3.48 | % | Fixed rate | N/A | ||||||||||
Powder Springs | 9/30/2014 | 7,111 | 7,152 | 10/1/2019 | 3.48 | % | Fixed rate | N/A | ||||||||||
Kingwood Glen | 9/30/2014 | 11,276 | 11,340 | 10/1/2019 | 3.48 | % | Fixed rate | N/A | ||||||||||
Barclay Crossing | 9/30/2014 | 6,340 | 6,376 | 10/1/2019 | 3.48 | % | Fixed rate | N/A | ||||||||||
Sweetgrass Corner | 9/30/2014 | 7,687 | 7,731 | 10/1/2019 | 3.58 | % | Fixed rate | N/A | ||||||||||
Parkway Centre | 9/30/2014 | 4,415 | 4,441 | 10/1/2019 | 3.48 | % | Fixed rate | N/A | ||||||||||
The Market at Salem Cove | 10/6/2014 | 9,381 | 9,423 | 11/1/2024 | 4.21 | % | Fixed rate | 11/30/2016 | ||||||||||
Independence Square | 8/27/2015 | 11,905 | 11,967 | 9/1/2022 | 3.93 | % | Fixed rate | 9/30/2016 | ||||||||||
Royal Lakes Marketplace | 9/4/2015 | 9,654 | 9,690 | 9/4/2020 | 4.16 | % | 250 | 4/3/2017 | ||||||||||
The Overlook at Hamilton Place | 12/22/2015 | 20,206 | 20,301 | 1/1/2026 | 4.19 | % | Fixed rate | N/A | ||||||||||
Summit Point | 10/30/2015 | 12,122 | 12,208 | 11/1/2022 | 3.57 | % | Fixed rate | N/A | ||||||||||
East Gate Shopping Center | 4/29/2016 | 5,542 | 5,578 | 5/1/2026 | 3.97 | % | Fixed rate | N/A | ||||||||||
Fury's Ferry | 4/29/2016 | 6,402 | 6,444 | 5/1/2026 | 3.97 | % | Fixed rate | N/A | ||||||||||
Rosewood Shopping Center | 4/29/2016 | 4,300 | 4,328 | 5/1/2026 | 3.97 | % | Fixed rate | N/A | ||||||||||
Southgate Village | 4/29/2016 | 7,644 | 7,694 | 5/1/2026 | 3.97 | % | Fixed rate | N/A | ||||||||||
The Market at Victory Village | 5/16/2016 | 9,176 | 9,214 | 9/11/2024 | 4.40 | % | Fixed rate | 10/10/2017 | ||||||||||
Wade Green Village | 4/7/2016 | 7,931 | 7,969 | 5/1/2026 | 4.00 | % | Fixed rate | N/A | ||||||||||
Lakeland Plaza | 7/15/2016 | 28,834 | 29,023 | 8/1/2026 | 3.85 | % | Fixed rate | N/A | ||||||||||
University Palms | 8/8/2016 | 13,072 | 13,162 | 9/1/2026 | 3.45 | % | Fixed rate | N/A | ||||||||||
Cherokee Plaza | 8/8/2016 | 25,153 | 25,322 | 9/1/2021 | 3.91 | % | 225 | (6) | N/A | |||||||||
Sandy Plains Exchange | 8/8/2016 | 9,131 | 9,194 | 9/1/2026 | 3.45 | % | Fixed rate | N/A | ||||||||||
Thompson Bridge Commons | 8/8/2016 | 12,207 | 12,291 | 9/1/2026 | 3.45 | % | Fixed rate | N/A | ||||||||||
Heritage Station | 8/8/2016 | 9,035 | 9,097 | 9/1/2026 | 3.45 | % | Fixed rate | N/A | ||||||||||
Oak Park Village | 8/8/2016 | 9,323 | 9,388 | 9/1/2026 | 3.45 | % | Fixed rate | N/A | ||||||||||
Shoppes of Parkland | 8/8/2016 | 16,174 | 16,241 | 9/1/2023 | 4.67 | % | Fixed rate | N/A | ||||||||||
Champions Village | 10/18/2016 | 27,400 | 27,400 | 11/1/2021 | 4.67 | % | 300 | (7) | 11/1/2021 |
Table continued from previous page | Principal balance as of | Interest only through date (1) | ||||||||||||||||
Acquisition/ refinancing date | March 31, 2018 | December 31, 2017 | Maturity date | Interest rate | Basis point spread over 1 Month LIBOR | |||||||||||||
Castleberry-Southard | 4/21/2017 | 11,332 | 11,383 | 5/1/2027 | 3.99 | % | Fixed rate | N/A | ||||||||||
Rockbridge Village | 6/6/2017 | 14,076 | 14,142 | 7/5/2027 | 3.73 | % | Fixed rate | N/A | ||||||||||
Irmo Station | 7/26/2017 | 10,502 | 10,566 | 8/1/2030 | 3.94 | % | Fixed rate | N/A | ||||||||||
Maynard Crossing | 8/25/2017 | 18,274 | 18,388 | 9/1/2032 | 3.74 | % | Fixed rate | N/A | ||||||||||
Woodmont Village | 9/8/2017 | 8,691 | 8,741 | 10/1/2027 | 4.125 | % | Fixed rate | N/A | ||||||||||
West Town Market | 9/22/2017 | 8,907 | 8,963 | 10/1/2025 | 3.65 | % | Fixed rate | N/A | ||||||||||
Crossroads Market | 12/5/2017 | 18,925 | 19,000 | 1/1/2030 | 3.95 | % | Fixed rate | N/A | ||||||||||
Anderson Central | 3/16/2018 | 12,000 | — | 4/1/2028 | 4.32 | % | Fixed rate | N/A | ||||||||||
Total grocery-anchored shopping centers | 420,111 | 410,281 | ||||||||||||||||
Student housing properties: | ||||||||||||||||||
North by Northwest | 6/1/2016 | 32,574 | 32,767 | 9/1/2022 | 4.02 | % | Fixed rate | N/A | ||||||||||
SoL | 3/29/2018 | 37,485 | 37,485 | 2/1/2019 | 3.98 | % | 210 | 2/1/2019 | ||||||||||
Stadium Village | 10/27/2017 | 46,718 | 46,930 | 11/1/2024 | 3.80 | % | Fixed rate | N/A | ||||||||||
Ursa | 12/18/2017 | 31,400 | 31,400 | 1/5/2020 | 4.88 | % | 300 | 1/5/2020 | ||||||||||
Total student housing properties | 148,177 | 148,582 | ||||||||||||||||
Office buildings: | ||||||||||||||||||
Brookwood Center | 8/29/2016 | 32,037 | 32,219 | 9/10/2031 | 3.52 | % | Fixed rate | 10/9/2017 | ||||||||||
Galleria 75 | 11/4/2016 | 5,668 | 5,716 | 7/1/2022 | 4.25 | % | Fixed rate | N/A | ||||||||||
Three Ravinia | 12/30/2016 | 115,500 | 115,500 | 1/1/2042 | 4.46 | % | Fixed rate | 1/31/2022 | ||||||||||
Westridge at La Cantera | 11/13/2017 | 54,126 | 54,440 | 12/10/2028 | 4.10 | % | Fixed rate | N/A | ||||||||||
Armour Yards | 1/29/2018 | 40,000 | — | 2/1/2028 | 4.10 | % | Fixed rate | 1/31/2020 | ||||||||||
Total office buildings | 247,331 | 207,875 | ||||||||||||||||
Grand total | 1,907,974 | 1,812,048 | ||||||||||||||||
Less: deferred loan costs | (30,926 | ) | (30,249 | ) | ||||||||||||||
Less: below market debt adjustment | (5,082 | ) | (5,147 | ) | ||||||||||||||
Mortgage notes, net | $ | 1,871,966 | $ | 1,776,652 | ||||||||||||||
Footnotes to Mortgage Notes Table | |||||||||||
(1) Following the indicated interest only period (where applicable), monthly payments of accrued interest and principal are based on a 25 to 35-year amortization period through the maturity date. | |||||||||||
(2) On date, the Company legally defeased the mortgage loan in conjunction with the sale of its Lake Cameron property, located in Raleigh, NC. In connection with the defeasance, the mortgage and other liens on the property were extinguished and all existing collateral, including various guarantees, were released. As a result of the defeasance, the Company incurred costs associated with a defeasance premium of approximately $355. | |||||||||||
(3) The mortgage instrument was assumed as part of the sales transaction; the 1 Month LIBOR index is capped at 5.0%, resulting in a cap on the combined rate of 6.6%. | |||||||||||
(4) The 1 Month LIBOR index is capped at 4.33% resulting in a cap on the combined rate of 6.5%. | |||||||||||
(5) The property was temporarily financed through a credit facility sponsored by the Federal Home Loan Mortgage Corporation; the Company obtained permanent mortgage financing subsequent to the closing as shown. | |||||||||||
(6) The interest rate has a floor of 2.7%. | |||||||||||
(7) The interest rate has a floor of 3.25%. |
Three months ended March 31, 2018 | |||||||||||||||||
Property | Location | Number of units | Average unit size (sq. ft.) | Average physical occupancy | Average rent per unit | ||||||||||||
Established Communities: | |||||||||||||||||
Stone Rise | Philadelphia, PA | 216 | 1,078 | 94.6 | % | $ | 1,451 | ||||||||||
McNeil Ranch | Austin, TX | 192 | 1,071 | 95.1 | % | $ | 1,257 | ||||||||||
Avenues at Cypress | Houston, TX | 240 | 1,170 | 94.6 | % | $ | 1,423 | ||||||||||
Avenues at Northpointe | Houston, TX | 280 | 1,167 | 95.7 | % | $ | 1,340 | ||||||||||
Stoneridge Farms at the Hunt Club | Nashville, TN | 364 | 1,153 | 94.7 | % | $ | 1,098 | ||||||||||
Vineyards | Houston, TX | 369 | 1,122 | 95.8 | % | $ | 1,145 | ||||||||||
Aster at Lely Resort | Naples, FL | 308 | 1,071 | 95.8 | % | $ | 1,467 | ||||||||||
Venue at Lakewood Ranch | Sarasota, FL | 237 | 1,001 | 95.6 | % | $ | 1,568 | ||||||||||
Citi Lakes | Orlando, FL | 346 | 984 | 94.5 | % | $ | 1,394 | ||||||||||
Lenox Portfolio | Nashville, TN | 474 | 861 | 96.1 | % | $ | 1,207 | ||||||||||
Overton Rise | Atlanta, GA | 294 | 1,018 | 94.7 | % | $ | 1,498 | ||||||||||
Sorrel | Jacksonville, FL | 290 | 1,048 | 93.6 | % | $ | 1,258 | ||||||||||
Total/Average Established Communities | 3,610 | 95.1 | % | ||||||||||||||
Summit Crossing | Atlanta, GA | 485 | 1,053 | 92.5 | % | $ | 1,188 | ||||||||||
CityPark View | Charlotte, NC | 284 | 948 | — | $ | 1,072 | |||||||||||
Avenues at Creekside | San Antonio, TX | 395 | 974 | — | $ | 1,143 | |||||||||||
Stone Creek | Houston, TX | 246 | 852 | — | $ | 1,044 | |||||||||||
525 Avalon Park | Orlando, FL | 487 | 1,394 | — | $ | 1,396 | |||||||||||
Retreat at Greystone | Birmingham, AL | 312 | 1,100 | 94.4 | % | $ | 1,212 | ||||||||||
Broadstone at Citrus Village | Tampa, FL | 296 | 980 | 97.7 | % | $ | 1,267 | ||||||||||
Founders Village | Williamsburg, VA | 247 | 1,070 | 94.9 | % | $ | 1,362 | ||||||||||
Crosstown Walk | Tampa, FL | 342 | 981 | 95.4 | % | $ | 1,268 | ||||||||||
Claiborne Crossing | Louisville, KY | 242 | 1,204 | — | $ | 1,308 | |||||||||||
Luxe at Lakewood Ranch | Sarasota, FL | 280 | 1,105 | — | $ | 1,516 | |||||||||||
Adara Overland Park | Kansas City, KS | 260 | 1,116 | 94.1 | % | $ | 1,310 | ||||||||||
Aldridge at Town Village | Atlanta, GA | 300 | 969 | 95.3 | % | $ | 1,303 | ||||||||||
The Reserve at Summit Crossing | Atlanta, GA | 172 | 1,002 | — | $ | 1,315 | |||||||||||
Overlook at Crosstown Walk | Tampa, FL | 180 | 986 | — | $ | 1,360 | |||||||||||
Colony at Centerpointe | Richmond, VA | 255 | 1,149 | — | $ | 1,305 | |||||||||||
Lux at Sorrel | Jacksonville, FL | 265 | 1,025 | — | n/a | ||||||||||||
Green Park | Atlanta, GA | 310 | 985 | — | n/a | ||||||||||||
Value-add project: | |||||||||||||||||
Village at Baldwin Park | Orlando, FL | 528 | 1,069 | — | $ | 1,572 | |||||||||||
5,886 | |||||||||||||||||
Joint venture: | |||||||||||||||||
City Vista | Pittsburgh, PA | 272 | 1,023 | 94.2 | % | $ | 1,343 | ||||||||||
Total PAC Non-Established Communities | 6,158 | ||||||||||||||||
Average stabilized physical occupancy | 94.9 | % | (1) | ||||||||||||||
Student housing communities: (2) | Average rent per bed | ||||||||||||||||
North by Northwest | Tallahassee, FL | 219 | (2 | ) | 1,250 | 99.2 | % | $ | 724 | ||||||||
SoL | Tempe, AZ | 224 | (2 | ) | 1,296 | 91.3 | % | $ | 713 | ||||||||
Stadium Village (3) | Atlanta, GA | 198 | (2 | ) | 1,466 | 99.7 | % | $ | 670 | ||||||||
Ursa (3) | Waco, TX | 250 | (2 | ) | 1,634 | — | n/a | ||||||||||
Total All PAC units | 10,659 | ||||||||||||||||
(1) Excludes average occupancy for student housing communities. | |||||||||||||||||
(2) North by Northwest has 679 beds, SoL has 639 beds, Stadium Village has 792 beds and Ursa has 840 beds. | |||||||||||||||||
(3) The Company acquired and owns an approximate 99% equity interest in a joint venture which owns both Stadium Village and Ursa. |
Capital Expenditures | |||||||||||||||||||||||||
Recurring | Non-recurring | Total | |||||||||||||||||||||||
(in thousands, except per-unit figures) | Amount | Per Unit | Amount | Per Unit | Amount | Per Unit | |||||||||||||||||||
Appliances | $ | 99 | $ | 37.50 | $ | 1 | $ | 0.43 | $ | 100 | $ | 37.93 | |||||||||||||
Carpets | 278 | 105.23 | — | — | 278 | 105.23 | |||||||||||||||||||
Wood / vinyl flooring | 54 | 20.55 | — | — | 54 | 20.55 | |||||||||||||||||||
Mini blinds and ceiling fans | 14 | 5.32 | — | — | 14 | 5.32 | |||||||||||||||||||
Fire safety | 4 | 1.43 | 13 | 4.85 | 17 | 6.28 | |||||||||||||||||||
HVAC | 38 | 14.38 | — | — | 38 | 14.38 | |||||||||||||||||||
Computers, equipment, misc. | 24 | 9.05 | 47 | 17.64 | 71 | 26.69 | |||||||||||||||||||
Elevators | — | — | 5 | 2.01 | 5 | 2.01 | |||||||||||||||||||
Leasing office and other common amenities | 1 | 0.40 | 93 | 35.33 | 94 | 35.73 | |||||||||||||||||||
Major structural projects | 6 | 2.34 | 93 | 35.10 | 99 | 37.44 | |||||||||||||||||||
Cabinets and counter top upgrades | — | — | 292 | 110.46 | 292 | 110.46 | |||||||||||||||||||
Landscaping and fencing | — | — | 27 | 10.26 | 27 | 10.26 | |||||||||||||||||||
Parking lot | — | — | 47 | 17.85 | 47 | 17.85 | |||||||||||||||||||
Common area items | — | — | 5 | 1.77 | 5 | 1.77 | |||||||||||||||||||
Totals | $ | 518 | $ | 196.20 | $ | 623 | $ | 235.70 | $ | 1,141 | $ | 431.90 |
Property name | Location | Year built | GLA (1) | Percent leased | Grocery anchor tenant | ||||||
Castleberry-Southard | Atlanta, GA | 2006 | 80,018 | 100.0 | % | Publix | |||||
Cherokee Plaza | Atlanta, GA | 1958 | 102,864 | 100.0 | % | Kroger | |||||
Lakeland Plaza | Atlanta, GA | 1990 | 301,711 | 95.8 | % | Sprouts | |||||
Powder Springs | Atlanta, GA | 1999 | 77,853 | 95.1 | % | Publix | |||||
Rockbridge Village | Atlanta, GA | 2005 | 102,432 | 95.5 | % | Kroger | |||||
Roswell Wieuca Shopping Center | Atlanta, GA | 2007 | 74,370 | 100.0 | % | The Fresh Market | |||||
Royal Lakes Marketplace | Atlanta, GA | 2008 | 119,493 | 84.4 | % | Kroger | |||||
Sandy Plains Exchange | Atlanta, GA | 1997 | 72,784 | 93.2 | % | Publix | |||||
Summit Point | Atlanta, GA | 2004 | 111,970 | 86.5 | % | Publix | |||||
Thompson Bridge Commons | Atlanta, GA | 2001 | 92,587 | 96.1 | % | Kroger | |||||
Wade Green Village | Atlanta, GA | 1993 | 74,978 | 95.9 | % | Publix | |||||
Woodmont Village | Atlanta, GA | 2002 | 85,639 | 96.0 | % | Kroger | |||||
Woodstock Crossing | Atlanta, GA | 1994 | 66,122 | 97.7 | % | Kroger | |||||
East Gate Shopping Center | Augusta, GA | 1995 | 75,716 | 89.5 | % | Publix | |||||
Fury's Ferry | Augusta, GA | 1996 | 70,458 | 98.6 | % | Publix | |||||
Parkway Centre | Columbus, GA | 1999 | 53,088 | 97.4 | % | Publix | |||||
Spring Hill Plaza | Nashville, TN | 2005 | 61,570 | 100.0 | % | Publix | |||||
Parkway Town Centre | Nashville, TN | 2005 | 65,587 | 100.0 | % | Publix | |||||
The Market at Salem Cove | Nashville, TN | 2010 | 62,356 | 97.8 | % | Publix | |||||
The Market at Victory Village | Nashville, TN | 2007 | 71,300 | 98.5 | % | Publix | |||||
The Overlook at Hamilton Place | Chattanooga, TN | 1992 | 213,095 | 100.0 | % | The Fresh Market | |||||
Shoppes of Parkland | Miami-Ft. Lauderdale, FL | 2000 | 145,720 | 100.0 | % | BJ's Wholesale Club | |||||
Barclay Crossing | Tampa, FL | 1998 | 54,958 | 100.0 | % | Publix | |||||
Deltona Landings | Orlando, FL | 1999 | 59,966 | 100.0 | % | Publix | |||||
University Palms | Orlando, FL | 1993 | 99,172 | 100.0 | % | Publix | |||||
Crossroads Market | Naples, FL | 1993 | 126,895 | 98.1 | % | Publix | |||||
Champions Village | Houston, TX | 1973 | 383,346 | 75.0 | % | Randalls | |||||
Kingwood Glen | Houston, TX | 1998 | 103,397 | 100.0 | % | Kroger | |||||
Independence Square | Dallas, TX | 1977 | 140,218 | 84.3 | % | Tom Thumb | |||||
Oak Park Village | San Antonio, TX | 1970 | 64,855 | 100.0 | % | H.E.B. | |||||
Sweetgrass Corner | Charleston, SC | 1999 | 89,124 | 100.0 | % | Bi-Lo | |||||
Irmo Station | Columbia, SC | 1980 | 99,384 | 95.3 | % | Kroger | |||||
Anderson Central | Greenville Spartanburg, SC | 1999 | 223,211 | 96.1 | % | Walmart | |||||
Fairview Market | Greenville Spartanburg, SC | 1998 | 53,888 | 73.5 | % | Aldi | |||||
Rosewood Shopping Center | Columbia, SC | 2002 | 36,887 | 90.2 | % | Publix | |||||
West Town Market | Charlotte, NC | 2004 | 67,883 | 100.0 | % | Harris Teeter | |||||
Heritage Station | Raleigh, NC | 2004 | 72,946 | 100.0 | % | Harris Teeter | |||||
Maynard Crossing | Raleigh, NC | 1996 | 122,781 | 98.6 | % | Kroger | |||||
Southgate Village | Birmingham, AL | 1988 | 75,092 | 100.0 | % | Publix | |||||
Grand total/weighted average | 4,055,714 | 94.1 | % |
Total grocery-anchored shopping center portfolio | ||||||||
Number of leases | Leased GLA | Percent of leased GLA | ||||||
Month to month | 13 | 25,158 | 0.7 | % | ||||
2018 | 72 | 239,263 | 6.3 | % | ||||
2019 | 97 | 561,832 | 14.7 | % | ||||
2020 | 109 | 497,860 | 13.0 | % | ||||
2021 | 94 | 440,527 | 11.5 | % | ||||
2022 | 90 | 313,726 | 8.2 | % | ||||
2023 | 44 | 203,115 | 5.3 | % | ||||
2024 | 18 | 551,844 | 14.5 | % | ||||
2025 | 19 | 298,146 | 7.8 | % | ||||
2026 | 9 | 127,071 | 3.3 | % | ||||
2027 | 16 | 112,101 | 2.9 | % | ||||
2028+ | 22 | 446,360 | 11.8 | % | ||||
Total | 603 | 3,817,003 | 100.0 | % |
Property Name | Location | GLA | Percent leased | |||||
Three Ravinia | Atlanta, GA | 814,000 | 98 | % | ||||
Westridge at La Cantera | San Antonio, TX | 258,000 | 100 | % | ||||
Armour Yards | Atlanta, GA | 187,000 | 97 | % | ||||
Brookwood Center | Birmingham, AL | 169,000 | 100 | % | ||||
Galleria 75 | Atlanta, GA | 111,000 | 94 | % | ||||
1,539,000 | 98 | % |
Square footage | Percent of Annual Base Rent | Annual Base Rent | |||||||||
InterContinental Hotels Group | 496,391 | 34.1 | % | $ | 11,210,020 | ||||||
State Farm Mutual Automobile Insurance Company | 183,168 | 9.8 | % | 3,232,086 | |||||||
Harland Clarke Corporation | 129,016 | 8.5 | % | 2,810,678 | |||||||
United Services Automobile Association | 129,015 | 9.2 | % | 3,042,173 | |||||||
Southern Natural Gas Company, LLC | 63,113 | 5.7 | % | 1,862,077 | |||||||
1,000,703 | 67.3 | % | $ | 22,157,034 |
Office building portfolio | ||||||
Percent of | ||||||
Year of lease expiration | Rentable square | rented | ||||
feet | square feet | |||||
2018 | 5,626 | 0.4 | % | |||
2019 | 22,890 | 1.5 | % | |||
2020 | 110,596 | 7.4 | % | |||
2021 | 231,549 | 15.5 | % | |||
2022 | 41,532 | 2.8 | % | |||
2023 | 96,775 | 6.5 | % | |||
2024 | 24,120 | 1.6 | % | |||
2025 | 58,276 | 3.9 | % | |||
2026 | — | — | % | |||
2027 | 258,031 | 17.2 | % | |||
2028+ | 645,364 | 43.2 | % | |||
Total | 1,494,759 | 100.0 | % |
• | excluding impairment charges on and gains/losses from sales of depreciable property; |
• | plus depreciation and amortization of real estate assets and deferred leasing costs; and |
• | after adjustments for the Company's proportionate share of unconsolidated partnerships and joint ventures. |
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