North Dakota
|
45-0311232
|
(State or other jurisdiction of
|
(I.R.S. Employer Identification No.)
|
incorporation or organization)
|
|
1400 31st Avenue SW, Suite 60
|
|
Post Office Box 1988
|
|
Minot, ND 58702-1988
|
|
(Address of principal executive offices) (Zip code)
|
Yes R
|
No £
|
Yes R
|
No £
|
Large accelerated filer R
|
Accelerated filer £
|
|
Non-accelerated filer £
|
Smaller Reporting Company £
|
Yes £
|
No R
|
Page
|
|
Part I. Financial Information
|
|
Item 1. Financial Statements - Third Quarter - Fiscal 2015:
|
3
|
Condensed Consolidated Balance Sheets (unaudited)
|
3
|
January 31, 2015 and April 30, 2014
|
|
Condensed Consolidated Statements of Operations (unaudited)
|
4
|
For the Three and Nine Months ended January 31, 2015 and 2014
|
|
Condensed Consolidated Statements of Equity (unaudited)
|
5
|
For the Nine Months ended January 31, 2015 and 2014
|
|
Condensed Consolidated Statements of Cash Flows (unaudited)
|
6
|
For the Nine Months ended January 31, 2015 and 2014
|
|
Notes to Condensed Consolidated Financial Statements (unaudited)
|
8
|
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
|
29
|
Item 3. Quantitative and Qualitative Disclosures About Market Risk
|
53
|
Item 4. Controls and Procedures
|
54
|
Part II. Other Information
|
|
Item 1. Legal Proceedings
|
55
|
Item 1A. Risk Factors
|
55
|
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
|
55
|
Item 3. Defaults Upon Senior Securities
|
55
|
Item 4. Mine Safety Disclosures
|
55
|
Item 5. Other Information
|
55
|
Item 6. Exhibits
|
55
|
Signatures
|
56
|
(in thousands, except share data)
|
||||
January 31, 2015
|
April 30, 2014
|
|||
ASSETS
|
||||
Real estate investments
|
||||
Property owned
|
$
|
2,093,148
|
$
|
1,996,031
|
Less accumulated depreciation
|
(439,153)
|
(424,288)
|
||
1,653,995
|
1,571,743
|
|||
Development in progress
|
114,005
|
104,609
|
||
Unimproved land
|
27,675
|
22,864
|
||
Total real estate investments
|
1,795,675
|
1,699,216
|
||
Real estate held for sale
|
44,259
|
2,951
|
||
Cash and cash equivalents
|
52,148
|
47,267
|
||
Other investments
|
329
|
329
|
||
Receivable arising from straight-lining of rents, net of allowance of $714 and $796, respectively
|
27,169
|
27,096
|
||
Accounts receivable, net of allowance of $445 and $248, respectively
|
5,574
|
10,206
|
||
Real estate deposits
|
7,494
|
145
|
||
Prepaid and other assets
|
5,580
|
4,639
|
||
Intangible assets, net of accumulated amortization of $25,423 and $24,071, respectively
|
28,475
|
32,639
|
||
Tax, insurance, and other escrow
|
11,277
|
20,880
|
||
Property and equipment, net of accumulated depreciation of $1,364 and $2,041, respectively
|
1,619
|
1,681
|
||
Goodwill
|
1,940
|
1,100
|
||
Deferred charges and leasing costs, net of accumulated amortization of $21,020 and $21,068, respectively
|
19,803
|
21,072
|
||
TOTAL ASSETS
|
$
|
2,001,342
|
$
|
1,869,221
|
LIABILITIES AND EQUITY
|
||||
LIABILITIES
|
||||
Accounts payable and accrued expenses
|
$
|
69,901
|
$
|
59,105
|
Revolving line of credit
|
50,500
|
22,500
|
||
Mortgages payable
|
1,006,179
|
997,689
|
||
Other
|
132,210
|
63,178
|
||
TOTAL LIABILITIES
|
1,258,790
|
1,142,472
|
||
COMMITMENTS AND CONTINGENCIES (NOTE 6)
|
||||
REDEEMABLE NONCONTROLLING INTERESTS – CONSOLIDATED REAL ESTATE ENTITIES
|
6,340
|
6,203
|
||
EQUITY
|
||||
Investors Real Estate Trust shareholders' equity
|
||||
Series A Preferred Shares of Beneficial Interest (Cumulative redeemable preferred shares, no par value, 1,150,000 shares issued and outstanding at January 31, 2015 and April 30, 2014, aggregate liquidation preference of $28,750,000)
|
27,317
|
27,317
|
||
Series B Preferred Shares of Beneficial Interest (Cumulative redeemable preferred shares, no par value, 4,600,000 shares issued and outstanding at January 31, 2015 and April 30, 2014, aggregate liquidation preference of $115,000,000)
|
111,357
|
111,357
|
||
Common Shares of Beneficial Interest (Unlimited authorization, no par value, 122,134,143 shares issued and outstanding at January 31, 2015, and 109,019,341 shares issued and outstanding at April 30, 2014)
|
935,287
|
843,268
|
||
Accumulated distributions in excess of net income
|
(430,282)
|
(389,758)
|
||
Total Investors Real Estate Trust shareholders' equity
|
643,679
|
592,184
|
||
Noncontrolling interests – Operating Partnership (14,397,983 units at January 31, 2015 and 21,093,445 units at April 30, 2014)
|
61,177
|
105,724
|
||
Noncontrolling interests – consolidated real estate entities
|
31,356
|
22,638
|
||
Total equity
|
736,212
|
720,546
|
||
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
|
$
|
2,001,342
|
$
|
1,869,221
|
(in thousands, except per share data)
|
||||||||
Three Months Ended
January 31
|
Nine Months Ended
January 31
|
|||||||
2015
|
2014
|
2015
|
2014
|
|||||
REVENUE
|
||||||||
Real estate rentals
|
$
|
60,440
|
$
|
56,156
|
$
|
176,401
|
$
|
164,256
|
Tenant reimbursement
|
11,513
|
11,473
|
33,431
|
34,243
|
||||
TRS senior housing revenue
|
963
|
804
|
2,599
|
804
|
||||
TOTAL REVENUE
|
72,916
|
68,433
|
212,431
|
199,303
|
||||
EXPENSES
|
||||||||
Depreciation/amortization related to real estate investments
|
16,834
|
16,733
|
49,846
|
51,156
|
||||
Utilities
|
5,367
|
5,042
|
15,141
|
15,173
|
||||
Maintenance
|
7,799
|
7,828
|
23,391
|
22,719
|
||||
Real estate taxes
|
8,816
|
7,679
|
25,583
|
24,415
|
||||
Insurance
|
1,479
|
1,190
|
4,560
|
3,904
|
||||
Property management expenses
|
4,746
|
4,064
|
13,731
|
12,383
|
||||
Other property expenses
|
227
|
124
|
783
|
304
|
||||
TRS senior housing expenses
|
825
|
671
|
2,243
|
671
|
||||
General and administrative
|
3,242
|
2,935
|
10,986
|
9,572
|
||||
Amortization related to non-real estate investments
|
916
|
756
|
2,628
|
2,500
|
||||
Impairment of real estate investments
|
540
|
4,798
|
6,105
|
4,798
|
||||
TOTAL EXPENSES
|
50,791
|
51,820
|
154,997
|
147,595
|
||||
Gain on involuntary conversion
|
0
|
1,514
|
0
|
2,480
|
||||
Operating income
|
22,125
|
18,127
|
57,434
|
54,188
|
||||
Interest expense
|
(14,595)
|
(15,130)
|
(43,858)
|
(44,525)
|
||||
Interest income
|
561
|
573
|
1,681
|
1,346
|
||||
Other income
|
109
|
34
|
376
|
123
|
||||
Income before gain (loss) on sale of real estate and other investments and income from discontinued operations
|
8,200
|
3,604
|
15,633
|
11,132
|
||||
Gain (loss) on sale of real estate and other investments
|
951
|
0
|
(811)
|
0
|
||||
Income from continuing operations
|
9,151
|
3,604
|
14,822
|
11,132
|
||||
Income from discontinued operations
|
0
|
465
|
0
|
6,450
|
||||
NET INCOME
|
9,151
|
4,069
|
14,822
|
17,582
|
||||
Net income attributable to noncontrolling interests – Operating Partnership
|
(657)
|
(130)
|
(618)
|
(1,406)
|
||||
Net income attributable to noncontrolling interests – consolidated real estate entities
|
(123)
|
(436)
|
(870)
|
(808)
|
||||
Net income attributable to Investors Real Estate Trust
|
8,371
|
3,503
|
13,334
|
15,368
|
||||
Dividends to preferred shareholders
|
(2,879)
|
(2,879)
|
(8,636)
|
(8,636)
|
||||
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS
|
$
|
5,492
|
$
|
624
|
$
|
4,698
|
$
|
6,732
|
Earnings per common share from continuing operations – Investors Real Estate Trust – basic and diluted
|
$
|
.05
|
$
|
.00
|
$
|
.04
|
$
|
.01
|
Earnings per common share from discontinued operations – Investors Real Estate Trust – basic and diluted
|
.00
|
.00
|
.00
|
.05
|
||||
NET INCOME PER COMMON SHARE – BASIC AND DILUTED
|
$
|
.05
|
$
|
.00
|
$
|
.04
|
$
|
.06
|
DIVIDENDS PER COMMON SHARE
|
$
|
.1300
|
$
|
.1300
|
$
|
.3900
|
$
|
.3900
|
(in thousands)
|
||||||||||||
NUMBER
OF
PREFERRED
SHARES
|
PREFERRED
SHARES
|
NUMBER
OF COMMON
SHARES
|
COMMON
SHARES
|
ACCUMULATED
DISTRIBUTIONS
IN EXCESS OF
NET INCOME
|
NONCONTROLLING
INTERESTS
|
TOTAL
EQUITY
|
||||||
(as revised)
|
(as revised)
|
|||||||||||
Balance April 30, 2013
|
5,750
|
$
|
138,674
|
101,488
|
$
|
784,454
|
$
|
(310,341)
|
$
|
142,657
|
$
|
755,444
|
Net income attributable to Investors Real Estate Trust and nonredeemable noncontrolling interests
|
15,368
|
2,038
|
17,406
|
|||||||||
Distributions – common shares and units
|
(40,685)
|
(8,508)
|
(49,193)
|
|||||||||
Distributions – Series A preferred shares
|
(1,779)
|
(1,779)
|
||||||||||
Distributions – Series B preferred shares
|
(6,857)
|
(6,857)
|
||||||||||
Distribution reinvestment and share purchase plan
|
5,239
|
44,153
|
44,153
|
|||||||||
Share-based compensation
|
13
|
112
|
112
|
|||||||||
Partnership units issued
|
3,480
|
3,480
|
||||||||||
Redemption of units for common shares
|
197
|
1,131
|
(1,131)
|
0
|
||||||||
Contributions from nonredeemable noncontrolling interests – consolidated real estate entities
|
3,316
|
3,316
|
||||||||||
Other
|
(34)
|
(731)
|
(765)
|
|||||||||
Balance January 31, 2014
|
5,750
|
$
|
138,674
|
106,937
|
$
|
829,816
|
$
|
(344,294)
|
$
|
141,121
|
$
|
765,317
|
Balance April 30, 2014
|
5,750
|
$
|
138,674
|
109,019
|
$
|
843,268
|
$
|
(389,758)
|
$
|
128,362
|
$
|
720,546
|
Net income attributable to Investors Real Estate Trust and nonredeemable noncontrolling interests
|
13,334
|
1,351
|
14,685
|
|||||||||
Distributions – common shares and units
|
(45,222)
|
(6,753)
|
(51,975)
|
|||||||||
Distributions – Series A preferred shares
|
(1,779)
|
(1,779)
|
||||||||||
Distributions – Series B preferred shares
|
(6,857)
|
(6,857)
|
||||||||||
Distribution reinvestment and share purchase plan
|
6,205
|
50,875
|
50,875
|
|||||||||
Share-based compensation
|
204
|
2,632
|
2,632
|
|||||||||
Partnership units issued
|
100
|
100
|
||||||||||
Redemption of units for common shares
|
6,706
|
38,512
|
(38,512)
|
0
|
||||||||
Contributions from nonredeemable noncontrolling interests – consolidated real estate entities
|
8,540
|
8,540
|
||||||||||
Other
|
(555)
|
(555)
|
||||||||||
Balance January 31, 2015
|
5,750
|
$
|
138,674
|
122,134
|
$
|
935,287
|
$
|
(430,282)
|
$
|
92,533
|
$
|
736,212
|
(in thousands)
|
||||
Nine Months Ended
January 31
|
||||
2015
|
2014
|
|||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||
Net income
|
$
|
14,822
|
$
|
17,582
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||
Depreciation and amortization
|
53,583
|
55,996
|
||
Loss (gain) on sale of real estate, land, other investments and discontinued operations
|
811
|
(6,999)
|
||
Gain on involuntary conversion
|
0
|
(2,480)
|
||
Share-based compensation expense
|
1,935
|
0
|
||
Impairment of real estate investments
|
6,105
|
6,658
|
||
Bad debt expense
|
840
|
346
|
||
Changes in other assets and liabilities:
|
||||
Increase in receivable arising from straight-lining of rents
|
(244)
|
(2,179)
|
||
Decrease (increase) in accounts receivable
|
2,217
|
(3,483)
|
||
Increase in prepaid and other assets
|
(1,140)
|
(3,127)
|
||
Increase in tax, insurance and other escrow
|
(548)
|
(1,779)
|
||
Increase in deferred charges and leasing costs
|
(2,716)
|
(3,506)
|
||
Increase in accounts payable, accrued expenses, and other liabilities
|
5,109
|
3,075
|
||
Net cash provided by operating activities
|
80,774
|
60,104
|
||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||
Proceeds from real estate deposits
|
575
|
926
|
||
Payments for real estate deposits
|
(7,924)
|
(4,232)
|
||
Decrease in lender holdbacks for improvements
|
11,063
|
2,186
|
||
Increase in lender holdbacks for improvements
|
(913)
|
(12,388)
|
||
Proceeds from sale of discontinued operations
|
0
|
78,879
|
||
Proceeds from sale of real estate and other investments
|
26,758
|
165
|
||
Insurance proceeds received
|
2,537
|
2,452
|
||
Payments for acquisitions of real estate assets
|
(24,404)
|
(33,662)
|
||
Payments for development and re-development of real estate assets
|
(143,256)
|
(97,288)
|
||
Payments for improvements of real estate assets
|
(24,681)
|
(25,815)
|
||
Net cash used by investing activities
|
(160,245)
|
(88,777)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||
Proceeds from mortgages payable
|
78,875
|
40,733
|
||
Principal payments on mortgages payable
|
(83,198)
|
(81,432)
|
||
Proceeds from revolving line of credit and other debt
|
45,000
|
12,500
|
||
Proceeds from construction debt
|
69,051
|
39,784
|
||
Principal payments on revolving line of credit and other debt
|
(17,000)
|
(17,443)
|
||
Proceeds from financing liability
|
0
|
7,900
|
||
Proceeds from sale of common shares under distribution reinvestment and share purchase program
|
38,819
|
33,160
|
||
Proceeds from noncontrolling partner – consolidated real estate entities
|
1,916
|
416
|
||
Distributions paid to common shareholders, net of reinvestment of $11,550 and $10,511, respectively
|
(33,672)
|
(30,174)
|
||
Distributions paid to preferred shareholders
|
(8,636)
|
(8,636)
|
||
Distributions paid to noncontrolling interests – Unitholders of the Operating Partnership, net of reinvestment of $506 and $482, respectively
|
(6,247)
|
(8,026)
|
||
Distributions paid to noncontrolling interests – consolidated real estate entities
|
(556)
|
(748)
|
||
Net cash provided (used) by financing activities
|
84,352
|
(11,966)
|
||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
4,881
|
(40,639)
|
||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
47,267
|
94,133
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
$
|
52,148
|
$
|
53,494
|
(in thousands)
|
||||
Nine Months Ended
January 31
|
||||
2015
|
2014
|
|||
SUPPLEMENTARY SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES FOR THE PERIOD
|
||||
Distribution reinvestment plan
|
$
|
11,550
|
$
|
10,511
|
Operating partnership distribution reinvestment plan
|
506
|
482
|
||
Operating partnership units converted to shares
|
38,512
|
1,131
|
||
Shares issued under the Incentive Award Plan
|
860
|
112
|
||
Real estate assets acquired through the issuance of operating partnership units
|
100
|
3,480
|
||
Real estate assets acquired through assumption of indebtedness and accrued costs
|
12,169
|
0
|
||
Increase (decrease) to accounts payable included within real estate investments
|
6,384
|
(325)
|
||
Real estate assets contributed by noncontrolling interests – consolidated real estate entities
|
6,624
|
2,900
|
||
Involuntary conversion of assets due to flood and fire damage
|
0
|
7,052
|
||
Forfeiture of note payable in conjunction with sale of property
|
0
|
600
|
||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
||||
Cash paid for interest, net of amounts capitalized of $3,628 and $2,139, respectively
|
$
|
39,073
|
$
|
40,845
|
(in thousands)
|
||||
January 31, 2015
|
April 30, 2014
|
|||
Identified intangible assets (included in intangible assets):
|
||||
Gross carrying amount
|
$
|
53,898
|
$
|
56,710
|
Accumulated amortization
|
(25,423)
|
(24,071)
|
||
Net carrying amount
|
$
|
28,475
|
$
|
32,639
|
Identified intangible liabilities (included in other liabilities):
|
||||
Gross carrying amount
|
$
|
134
|
$
|
173
|
Accumulated amortization
|
(107)
|
(127)
|
||
Net carrying amount
|
$
|
27
|
$
|
46
|
Year Ended April 30,
|
(in thousands)
|
|
2016
|
$
|
20
|
2017
|
12
|
|
2018
|
(1)
|
|
2019
|
(2)
|
|
2020
|
(1)
|
Year Ended April 30,
|
(in thousands)
|
|
2016
|
$
|
4,505
|
2017
|
4,036
|
|
2018
|
3,605
|
|
2019
|
3,481
|
|
2020
|
3,395
|
(in thousands)
|
||||||
Nine Months Ended January 31, 2014
|
As Previously Reported
|
Adjustment
|
As Revised
|
|||
Consolidated Statement of Equity
|
||||||
Noncontrolling Interests
|
||||||
Balance April 30, 2013
|
$
|
148,594
|
$
|
(5,937)
|
$
|
142,657
|
Net income attributable to Investors Real Estate Trust and nonredeemable noncontrolling interests
|
2,214
|
(176)
|
2,038
|
|||
Balance January 31, 2014
|
147,234
|
(6,113)
|
141,121
|
|||
Total Equity
|
||||||
Balance April 30, 2013
|
761,381
|
(5,937)
|
755,444
|
|||
Net income attributable to Investors Real Estate Trust and nonredeemable noncontrolling interests
|
17,582
|
(176)
|
17,406
|
|||
Balance January 31, 2014
|
771,430
|
(6,113)
|
765,317
|
(in thousands, except per share data)
|
||||||||
Three Months Ended
January 31
|
Nine Months Ended
January 31
|
|||||||
2015
|
2014
|
2015
|
2014
|
|||||
NUMERATOR
|
||||||||
Income from continuing operations – Investors Real Estate Trust
|
$
|
8,371
|
$
|
3,117
|
$
|
13,334
|
$
|
10,034
|
Income from discontinued operations – Investors Real Estate Trust
|
0
|
386
|
0
|
5,334
|
||||
Net income attributable to Investors Real Estate Trust
|
8,371
|
3,503
|
13,334
|
15,368
|
||||
Dividends to preferred shareholders
|
(2,879)
|
(2,879)
|
(8,636)
|
(8,636)
|
||||
Numerator for basic earnings per share – net income available to common shareholders
|
5,492
|
624
|
4,698
|
6,732
|
||||
Noncontrolling interests – Operating Partnership
|
657
|
130
|
618
|
1,406
|
||||
Numerator for diluted earnings per share
|
$
|
6,149
|
$
|
754
|
$
|
5,316
|
$
|
8,138
|
DENOMINATOR
|
||||||||
Denominator for basic earnings per share weighted average shares
|
120,855
|
106,208
|
116,303
|
104,472
|
||||
Effect of convertible operating partnership units
|
14,461
|
21,819
|
17,334
|
21,830
|
||||
Denominator for diluted earnings per share
|
135,316
|
128,027
|
133,637
|
126,302
|
||||
Earnings (loss) per common share from continuing operations – Investors Real Estate Trust – basic and diluted
|
$
|
.05
|
$
|
.00
|
$
|
.04
|
$
|
.01
|
Earnings per common share from discontinued operations – Investors Real Estate Trust – basic and diluted
|
.00
|
.00
|
.00
|
.05
|
||||
NET INCOME (LOSS) PER COMMON SHARE – BASIC & DILUTED
|
$
|
.05
|
$
|
.00
|
$
|
.04
|
$
|
.06
|
Three Months Ended January 31, 2015
|
(in thousands)
|
|||||||||||
Multi-Family
Residential |
Office |
Healthcare |
Industrial |
Retail |
Total
|
|||||||
Real estate revenue
|
$
|
30,256
|
$
|
19,086
|
$
|
17,587
|
$
|
1,741
|
$
|
3,283
|
$
|
71,953
|
Real estate expenses
|
|
13,318
|
|
9,050
|
|
4,315
|
|
501
|
|
1,250
|
|
28,434
|
Net operating income
|
$
|
16,938
|
$
|
10,036
|
$
|
13,272
|
$
|
1,240
|
$
|
2,033
|
43,519
|
|
TRS senior housing revenue
|
963
|
|||||||||||
TRS senior housing expenses
|
(825)
|
|||||||||||
Depreciation/amortization
|
(17,750)
|
|||||||||||
General and administrative
|
(3,242)
|
|||||||||||
Impairment of real estate investments
|
(540)
|
|||||||||||
Interest expense
|
(14,595)
|
|||||||||||
Interest and other income
|
670
|
|||||||||||
Income before gain on sale of real estate and other investments
|
8,200
|
|||||||||||
Gain on sale of real estate and other investments
|
951
|
|||||||||||
Net income
|
$
|
9,151
|
Three Months Ended January 31, 2014
|
(in thousands)
|
|||||||||||
Multi-Family
Residential |
Office |
Healthcare |
Industrial |
Retail |
Total
|
|||||||
Real estate revenue
|
$
|
25,848
|
$
|
19,394
|
$
|
17,242
|
$
|
1,664
|
$
|
3,481
|
$
|
67,629
|
Real estate expenses
|
|
10,998
|
|
9,037
|
|
4,120
|
|
493
|
|
1,279
|
|
25,927
|
Gain on involuntary conversion
|
1,514
|
0
|
0
|
0
|
0
|
1,514
|
||||||
Net operating income
|
$
|
16,364
|
$
|
10,357
|
$
|
13,122
|
$
|
1,171
|
$
|
2,202
|
43,216
|
|
TRS senior housing revenue
|
804
|
|||||||||||
TRS senior housing expenses
|
(671)
|
|||||||||||
Depreciation/amortization
|
(17,489)
|
|||||||||||
General and administrative
|
(2,935)
|
|||||||||||
Impairment of real estate investments
|
(4,798)
|
|||||||||||
Interest expense
|
(15,130)
|
|||||||||||
Interest and other income
|
607
|
|||||||||||
Income from continuing operations
|
3,604
|
|||||||||||
Income from discontinued operations
|
465
|
|||||||||||
Net income
|
$
|
4,069
|
Nine Months Ended January 31, 2015
|
(in thousands)
|
|||||||||||
Multi-Family
Residential |
Office |
Healthcare |
Industrial |
Retail |
Total
|
|||||||
Real estate revenue
|
$
|
87,576
|
$
|
56,917
|
$
|
50,322
|
$
|
4,904
|
$
|
10,113
|
$
|
209,832
|
Real estate expenses
|
|
37,700
|
|
27,873
|
|
12,905
|
|
1,223
|
|
3,488
|
|
83,189
|
Net operating income
|
$
|
49,876
|
$
|
29,044
|
$
|
37,417
|
$
|
3,681
|
$
|
6,625
|
126,643
|
|
TRS senior housing revenue
|
2,599
|
|||||||||||
TRS senior housing expenses
|
(2,243)
|
|||||||||||
Depreciation/amortization
|
(52,474)
|
|||||||||||
General and administrative
|
(10,986)
|
|||||||||||
Impairment of real estate investments
|
(6,105)
|
|||||||||||
Interest expense
|
(43,858)
|
|||||||||||
Interest and other income
|
2,057
|
|||||||||||
Income before loss on sale of real estate and other investments
|
15,633
|
|||||||||||
Loss on sale of real estate and other investments
|
(811)
|
|||||||||||
Net income
|
$
|
14,822
|
Nine Months Ended January 31, 2014
|
(in thousands)
|
|||||||||||
Multi-Family
Residential |
Office |
Healthcare |
Industrial |
Retail |
Total
|
|||||||
Real estate revenue
|
$
|
75,659
|
$
|
58,075
|
$
|
49,340
|
$
|
5,273
|
$
|
10,152
|
$
|
198,499
|
Real estate expenses
|
|
33,006
|
|
28,315
|
|
12,534
|
|
1,447
|
|
3,596
|
|
78,898
|
Gain on involuntary conversion
|
2,480
|
0
|
0
|
0
|
0
|
2,480
|
||||||
Net operating income
|
$
|
45,133
|
$
|
29,760
|
$
|
36,806
|
$
|
3,826
|
$
|
6,556
|
122,081
|
|
TRS senior housing revenue
|
804
|
|||||||||||
TRS senior housing expenses
|
(671)
|
|||||||||||
Depreciation/amortization
|
(53,656)
|
|||||||||||
General and administrative
|
(9,572)
|
|||||||||||
Impairment of real estate investments
|
(4,798)
|
|||||||||||
Interest expense
|
(44,525)
|
|||||||||||
Interest and other income
|
1,469
|
|||||||||||
Income from continuing operations
|
11,132
|
|||||||||||
Income from discontinued operations
|
6,450
|
|||||||||||
Net income
|
$
|
17,582
|
(in thousands)
|
||||||||||||
As of January 31, 2015
|
Multi-Family
Residential |
Office |
Healthcare |
Industrial |
Retail |
Total
|
||||||
Segment Assets
|
||||||||||||
Property owned
|
$
|
932,718
|
$
|
478,590
|
$
|
519,588
|
$
|
50,900
|
$
|
111,352
|
$
|
2,093,148
|
Less accumulated depreciation
|
(172,987)
|
(112,093)
|
(115,395)
|
(10,836)
|
(27,842)
|
(439,153)
|
||||||
Net property owned
|
$
|
759,731
|
$
|
366,497
|
$
|
404,193
|
$
|
40,064
|
$
|
83,510
|
1,653,995
|
|
Real estate held for sale
|
44,259
|
|||||||||||
Cash and cash equivalents
|
52,148
|
|||||||||||
Other investments
|
329
|
|||||||||||
Receivables and other assets
|
108,931
|
|||||||||||
Development in progress
|
114,005
|
|||||||||||
Unimproved land
|
27,675
|
|||||||||||
Total assets
|
$
|
2,001,342
|
(in thousands)
|
||||||||||||
As of April 30, 2014
|
Multi-Family
Residential |
Office |
Healthcare |
Industrial |
Retail |
Total
|
||||||
Segment assets
|
||||||||||||
Property owned
|
$
|
753,731
|
$
|
544,628
|
$
|
525,028
|
$
|
55,375
|
$
|
117,269
|
$
|
1,996,031
|
Less accumulated depreciation
|
(158,100)
|
(121,892)
|
(105,843)
|
(10,198)
|
(28,255)
|
(424,288)
|
||||||
Net property owned
|
$
|
595,631
|
$
|
422,736
|
$
|
419,185
|
$
|
45,177
|
$
|
89,014
|
1,571,743
|
|
Real estate held for sale
|
2,951
|
|||||||||||
Cash and cash equivalents
|
47,267
|
|||||||||||
Other investments
|
329
|
|||||||||||
Receivables and other assets
|
119,458
|
|||||||||||
Development in progress
|
104,609
|
|||||||||||
Unimproved land
|
22,864
|
|||||||||||
Total assets
|
$
|
1,869,221
|
(in thousands)
|
(in fiscal years)
|
||||||||
Project Name and Location
|
Planned Segment
|
Rentable
Square Feet
or Number of Units
|
Anticipated
Total Cost
|
Costs as of
January 31, 2015(1)
|
Anticipated Construction Completion
|
||||
Commons at Southgate - Minot, ND(2)
|
Multi-Family Residential
|
233 units
|
$
|
37,201
|
$
|
34,612
|
In Service
|
||
Minot Wells Fargo Bank - Minot, ND
|
Retail
|
4,998 sq ft
|
3,288
|
3,185
|
In Service
|
||||
Cypress Court II – St. Cloud, MN(3)
|
Multi-Family Residential
|
64 units
|
7,028
|
6,638
|
In Service
|
||||
Arcata - Golden Valley, MN
|
Multi-Family Residential
|
165 units
|
33,448
|
30,384
|
In Service
|
||||
Red 20 - Minneapolis, MN(4)
|
Multi-Family Residential
|
130 units
|
29,462
|
28,330
|
In Service
|
||||
Roseville 3075 Long Lake Rd - Roseville, MN
|
Industrial
|
202,807 sq ft
|
13,915
|
8,900
|
4Q 2015
|
||||
Minot Office Center - Minot, ND
|
Retail
|
7,963 sq ft
|
2,923
|
1,802
|
1Q 2016
|
||||
Renaissance Heights - Williston, ND(5)
|
Multi-Family Residential
|
288 units
|
62,362
|
54,713
|
1Q 2016
|
||||
Chateau II - Minot, ND
|
Multi-Family Residential
|
72 units
|
14,711
|
11,257
|
1Q 2016
|
||||
Edina 6565 France SMC III - Edina, MN
|
Healthcare
|
57,479 sq ft
|
34,665
|
16,668
|
1Q 2016
|
||||
Cardinal Point - Grand Forks, ND
|
Multi-Family Residential
|
251 units
|
40,042
|
19,885
|
2Q 2016
|
||||
Deer Ridge – Jamestown, ND
|
Multi-Family Residential
|
163 units
|
24,519
|
11,202
|
2Q 2016
|
||||
PrairieCare Medical - Brooklyn Park, MN
|
Healthcare
|
72,895 sq ft
|
24,251
|
12,195
|
2Q 2016
|
||||
71 France Phase I & II - Edina, MN(6)
|
Multi-Family Residential
|
181 units
|
52,055
|
20,787
|
3Q 2016
|
||||
Other
|
n/a
|
n/a
|
n/a
|
2,547
|
n/a
|
||||
$
|
379,870
|
$
|
263,105
|
(1)
|
Includes costs related to development projects that are placed in service in phases (Renaissance Heights - $46.0 million).
|
(2)
|
The Company is currently an approximately 52.9% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.
|
(3)
|
The Company is an approximately 86.1% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.
|
(4)
|
The Company is an approximately 58.6% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity. The anticipated total cost includes approximately 10,625 square feet of retail space.
|
(5)
|
The Company is an approximately 70% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.
|
(6)
|
The project will be constructed in three phases by a joint venture entity in which the Company has an approximately 52.6% interest. The anticipated total cost amount given in the table above is the total cost to the joint venture entity of the project's first and second phase. The expected total project cost for all three phases is approximately $73.3 million for a total of approximately 241 residential units and approximately 21,772 square feet of retail space.
|
·
|
a 119-unit multi-family residential property in Bismarck, North Dakota, for a purchase price of $15.0 million, of which approximately $14.3 million is to be paid in cash with the remainder in limited partnership units of the Operating Partnership valued at approximately $700,000;
|
·
|
a 74-unit multi-family residential property in Grand Forks, North Dakota, for a purchase price of $9.3 million, of which approximately $8.9 million is to be paid in cash with the remainder in limited partnership units of the Operating Partnership valued at approximately $400,000;
|
·
|
an office property in Minneapolis, Minnesota, for a sales price of $7.0 million;
|
·
|
a portfolio of seven office properties in Burnsville, Plymouth, Eagan and Minnetonka, Minnesota, for a sales price of $26.6 million;
|
·
|
an office property in Eagan, Minnesota, for a sales price of $950,000; and
|
·
|
a parcel of unimproved land in Eagan, Minnesota, for a sales price of $325,000.
|
(in thousands)
|
||||
Three Months Ended
January 31
|
Nine Months Ended
January 31
|
|||
2014
|
2014
|
|||
REVENUE
|
||||
Real estate rentals
|
$
|
327
|
$
|
3,173
|
Tenant reimbursement
|
64
|
1,302
|
||
TOTAL REVENUE
|
391
|
4,475
|
||
EXPENSES
|
||||
Depreciation/amortization related to real estate investments
|
75
|
920
|
||
Utilities
|
26
|
164
|
||
Maintenance
|
35
|
299
|
||
Real estate taxes
|
80
|
951
|
||
Insurance
|
10
|
97
|
||
Property management expenses
|
27
|
222
|
||
Amortization related to non-real estate investments
|
2
|
90
|
||
Impairment of real estate investments
|
0
|
1,860
|
||
TOTAL EXPENSES
|
255
|
4,603
|
||
Operating income (loss)
|
136
|
(128)
|
||
Interest expense
|
(29)
|
(421)
|
||
Income (loss) from discontinued operations before gain on sale
|
107
|
(549)
|
||
Gain on sale of discontinued operations
|
358
|
6,999
|
||
INCOME FROM DISCONTINUED OPERATIONS
|
$
|
465
|
$
|
6,450
|
(in thousands)
|
|||||||||||||||
Total
Acquisition
Cost
|
Form of Consideration
|
Investment Allocation
|
|||||||||||||
Acquisitions
|
Date Acquired
|
Cash
|
Units(1)
|
Other(2)
|
Land
|
Building
|
Intangible
Assets
|
||||||||
Multi-Family Residential
|
|||||||||||||||
152 unit - Homestead Garden - Rapid City, SD(3)
|
2014-06-02
|
$
|
15,000
|
$
|
5,092
|
$
|
0
|
$
|
9,908
|
$
|
655
|
$
|
14,139
|
$
|
206
|
52 unit - Silver Springs - Rapid City, SD
|
2014-06-02
|
3,280
|
1,019
|
0
|
2,261
|
215
|
3,006
|
59
|
|||||||
68 unit - Northridge - Bismarck, ND
|
2014-09-12
|
8,500
|
8,400
|
100
|
0
|
884
|
7,516
|
100
|
|||||||
26,780
|
14,511
|
100
|
12,169
|
1,754
|
24,661
|
365
|
|||||||||
Unimproved Land
|
|||||||||||||||
Creekside Crossing - Bismarck, ND
|
2014-05-22
|
4,269
|
4,269
|
0
|
0
|
4,269
|
0
|
0
|
|||||||
PrairieCare Medical - Brooklyn Park, MN
|
2014-06-05
|
2,616
|
2,616
|
0
|
0
|
2,616
|
0
|
0
|
|||||||
71 France Phase I - Edina, MN(4)
|
2014-06-12
|
1,413
|
0
|
0
|
1,413
|
1,413
|
0
|
0
|
|||||||
Monticello 7th Addition - Monticello, MN
|
2014-10-09
|
1,660
|
1,660
|
0
|
0
|
1,660
|
0
|
0
|
|||||||
71 France Phase II & III - Edina, MN(4)
|
2014-11-04
|
3,309
|
0
|
0
|
3,309
|
3,309
|
0
|
0
|
|||||||
Minot 1525 24th Ave SW - Minot, ND
|
2014-12-23
|
1,250
|
1,250
|
0
|
0
|
1,250
|
0
|
0
|
|||||||
14,517
|
9,795
|
0
|
4,722
|
14,517
|
0
|
0
|
|||||||||
Total Property Acquisitions
|
$
|
41,297
|
$
|
24,306
|
$
|
100
|
$
|
16,891
|
$
|
16,271
|
$
|
24,661
|
$
|
365
|
(1)
|
Value of limited partnership units of the Operating Partnership at the acquisition date.
|
(2)
|
Consists of assumed debt (Homestead Garden I: $9.9 million, Silver Springs: $2.3 million) and value of land contributed by the joint venture partner (71 France: $4.7 million).
|
(3)
|
At acquisition the Company adjusted the assumed debt to fair value and recognized approximately $852,000 of goodwill.
|
(4)
|
Land was contributed to a joint venture in which the Company has an approximately 52.6% interest. The joint venture is consolidated in IRET's financial statements.
|
(in thousands)
|
|||||||||||||||
Total
Acquisition
Cost
|
Form of Consideration
|
Investment Allocation
|
|||||||||||||
Acquisitions
|
Date Acquired
|
Cash
|
Units(1)
|
Other(2)
|
Land
|
Building
|
Intangible
Assets
|
||||||||
Multi-Family Residential
|
|||||||||||||||
71 unit - Alps Park - Rapid City, SD
|
2013-05-01
|
$
|
6,200
|
$
|
2,920
|
$
|
3,280
|
$
|
0
|
$
|
287
|
$
|
5,551
|
$
|
362
|
96 unit - Southpoint - Grand Forks, ND
|
2013-09-05
|
10,600
|
10,400
|
200
|
0
|
576
|
9,893
|
131
|
|||||||
24 unit - Pinecone Villas - Sartell, MN
|
2013-10-31
|
2,800
|
2,800
|
0
|
0
|
584
|
2,191
|
25
|
|||||||
19,600
|
16,120
|
3,480
|
0
|
1,447
|
17,635
|
518
|
|||||||||
Healthcare
|
|||||||||||||||
98,174 sq ft Legends at Heritage Place - Sartell, MN
|
2013-10-31
|
11,863
|
11,863
|
0
|
0
|
970
|
10,511
|
382
|
|||||||
Unimproved Land
|
|||||||||||||||
Chateau II - Minot, ND
|
2013-05-21
|
179
|
179
|
0
|
0
|
179
|
0
|
0
|
|||||||
Jamestown Unimproved - Jamestown, ND
|
2013-08-09
|
700
|
700
|
0
|
0
|
700
|
0
|
0
|
|||||||
Red 20 - Minneapolis, MN(3)
|
2013-08-20
|
1,900
|
0
|
0
|
1,900
|
1,900
|
0
|
0
|
|||||||
Legends at Heritage Place - Sartell, MN
|
2013-10-31
|
537
|
537
|
0
|
0
|
537
|
0
|
0
|
|||||||
Spring Creek Fruitland - Fruitland, IA
|
2014-01-21
|
335
|
335
|
0
|
0
|
335
|
0
|
0
|
|||||||
3,651
|
1,751
|
0
|
1,900
|
3,651
|
0
|
0
|
|||||||||
Total Property Acquisitions
|
$
|
35,114
|
$
|
29,734
|
$
|
3,480
|
$
|
1,900
|
$
|
6,068
|
$
|
28,146
|
$
|
900
|
(1)
|
Value of limited partnership units of the Operating Partnership at the acquisition date.
|
(2)
|
Value of land contributed by the joint venture partner.
|
(3)
|
Land was contributed to a joint venture in which the Company has an approximately 58.6% interest. The joint venture is consolidated in IRET's financial statements.
|
(in thousands)
|
||||
Nine Months Ended
January 31
|
||||
2015
|
2014
|
|||
Total revenue
|
$
|
1,756
|
$
|
1,149
|
Net loss
|
$
|
(27)
|
$
|
(194)
|
(in thousands)
|
|||||||
Development Projects Placed in Service (1)
|
Date Placed in
Service
|
Land
|
Building
|
Development
Cost
|
|||
Multi-Family Residential
|
|||||||
44 unit - Dakota Commons - Williston, ND(2)
|
2014-07-15
|
$
|
823
|
$
|
9,596
|
$
|
10,419
|
130 unit - Red 20 - Minneapolis, MN(3)
|
2014-11-21
|
1,900
|
26,430
|
28,330
|
|||
233 unit - Commons at Southgate - Minot, ND(4)
|
2014-12-09
|
3,691
|
30,921
|
34,612
|
|||
64 unit - Cypress Court II - St. Cloud, MN(5)
|
2015-01-01
|
447
|
6,191
|
6,638
|
|||
165 unit - Arcata - Golden Valley, MN(6)
|
2015-01-01
|
2,088
|
28,296
|
30,384
|
|||
8,949
|
101,434
|
110,383
|
|||||
Commercial Retail
|
|||||||
4,998 sq ft Minot Wells Fargo Bank - Minot, ND(7)
|
2014-11-10
|
992
|
2,193
|
3,185
|
|||
|
|
||||||
Total Development Projects Placed in Service
|
$
|
9,941
|
$
|
103,627
|
$
|
113,568
|
(1) | Development projects that are placed in service in phases are excluded from this table until the entire project has been placed in service. See Note 6 for additional information on the Renaissance Heights project, which was partially placed in service during the fiscal year 2014 and the nine months ended January 31, 2015. |
(2)
|
Costs paid in prior fiscal years totaled $8.1 million. Additional costs paid in fiscal year 2015 totaled $2.3 million, for a total project cost at January 31, 2015 of $10.4 million.
|
(3)
|
Costs paid in prior fiscal years totaled $12.2 million. Additional costs paid in fiscal year 2015 totaled $16.1 million, for a total project cost at January 31, 2015 of $28.3 million. The project is owned by a joint venture entity in which the Company has an approximately 58.6% interest. The joint venture is consolidated in IRET's financial statements.
|
(4)
|
Costs paid in prior fiscal years totaled $26.5 million, respectively. Additional costs paid in fiscal year 2015 totaled $8.1 million, for a total project cost at January 31, 2015 of $34.6 million. The project is owned by a joint venture entity in which the Company has an approximately 52.9% interest. The joint venture is consolidated in IRET's financial statements.
|
(5)
|
Costs paid in prior fiscal years totaled $1.2 million. Additional costs paid in fiscal year 2015 totaled $5.5 million, for a total project cost at January 31, 2015 of $6.6 million. The project is owned by a joint venture entity in which the Company has an approximately 86.1% interest. The joint venture is consolidated in IRET's financial statements.
|
(6)
|
Costs paid in prior fiscal years totaled $11.3 million, respectively. Additional costs paid in fiscal year 2015 totaled $19.1 million, for a total project cost at January 31, 2015 of $30.4 million.
|
(7)
|
Costs paid in fiscal year 2015 totaled $3.2 million, including land acquired in fiscal year 2013.
|
(in thousands)
|
|||||||
Development Projects Placed in Service
|
Date Placed in
Service
|
Land
|
Building
|
Development
Cost
|
|||
Multi-Family Residential
|
|||||||
108 unit - Landing at Southgate - Minot, ND(1)
|
2013-09-04
|
$
|
2,262
|
$
|
12,864
|
$
|
15,126
|
132 unit- Cypress Court - St. Cloud, MN(3)
|
2013-11-01
|
1,136
|
12,447
|
13,583
|
|||
146 unit- River Ridge - Bismarck, ND(3)
|
2013-12-02
|
589
|
24,229
|
24,818
|
|||
|
|
||||||
Total Development Projects Placed in Service
|
$
|
3,987
|
$
|
49,540
|
$
|
53,527
|
(1)
|
Costs paid in prior fiscal years totaled $6.3 million. Costs paid in fiscal year 2014 totaled $8.8 million for a total project cost at January 31, 2014 of $15.1 million. The project is owned by a joint venture entity in which the Company has an approximately 52.9% interest.
|
(2)
|
Costs paid in prior fiscal years totaled $5.8 million. Costs paid in fiscal year 2014 totaled $7.8 million for a total project cost at January 31, 2014 of $13.6 million. The project is owned by a joint venture entity in which the Company has an approximately 86.1% interest.
|
(3)
|
Costs paid in prior fiscal years totaled $10.1 million. Costs paid in fiscal year 2014 totaled $14.7 million for a total project cost at January 31, 2014 of $24.8 million.
|
(in thousands)
|
|||||||
Dispositions
|
Date
Disposed
|
Sales Price
|
Book Value
and Sales Cost
|
Gain/(Loss)
|
|||
Multi-Family Residential
|
|||||||
83 unit - Lancaster - St. Cloud, MN
|
2014-09-22
|
$
|
4,451
|
$
|
3,033
|
$
|
1,418
|
Office
|
|||||||
73,338 sq ft Dewey Hill - Edina, MN
|
2014-05-19
|
3,100
|
3,124
|
(24)
|
|||
74,568 sq ft Wirth Corporate Center - Golden Valley, MN
|
2014-08-29
|
4,525
|
4,695
|
(170)
|
|||
79,297 sq ft Northgate I – Maple Grove, MN
|
2014-12-01
|
7,200
|
6,881
|
319
|
|||
14,825
|
14,700
|
125
|
|||||
Industrial
|
|||||||
198,600 sq ft Eagan 2785 & 2795 - Eagan, MN
|
2014-07-15
|
3,600
|
5,393
|
(1,793)
|
|||
Retail
|
|||||||
25,644 sq ft Weston Retail - Weston, WI
|
2014-07-28
|
n/a
|
1,176
|
(1,176)
|
|||
52,000 sq ft Kalispell Retail - Kalispell, MT
|
2014-10-15
|
1,230
|
1,229
|
1
|
|||
34,226 sq ft Fargo Express Center & SC Pad - Fargo, ND
|
2014-11-18
|
2,843
|
2,211
|
632
|
|||
4,073
|
4,616
|
(543)
|
|||||
Unimproved Land
|
|||||||
Kalispell Unimproved - Kalispell, MT
|
2014-10-15
|
670
|
670
|
0
|
|||
Total Property Dispositions
|
$
|
27,619
|
$
|
28,412
|
$
|
(793)
|
(in thousands)
|
|||||||
Dispositions
|
Date
Disposed
|
Sales Price
|
Book Value
and Sales Cost
|
Gain/(Loss)
|
|||
Multi-Family Residential
|
|||||||
84 unit - East Park - Sioux Falls, SD
|
2013-12-18
|
$
|
2,214
|
$
|
2,358
|
$
|
(144)
|
48 unit - Sycamore Village - Sioux Falls, SD
|
2013-12-18
|
1,296
|
1,380
|
(84)
|
|||
3,510
|
3,738
|
(228)
|
|||||
Office
|
|||||||
121,669 sq ft Bloomington Business Plaza - Bloomington, MN
|
2013-09-12
|
4,500
|
7,339
|
(2,839)
|
|||
118,125 sq ft Nicollet VII - Burnsville, MN
|
2013-09-12
|
7,290
|
6,001
|
1,289
|
|||
42,929 sq ft Pillsbury Business Center - Bloomington, MN
|
2013-09-12
|
1,160
|
1,164
|
(4)
|
|||
12,950
|
14,504
|
(1,554)
|
|||||
Industrial
|
|||||||
41,880 sq ft Bodycote Industrial Building- Eden Prairie, MN
|
2013-05-13
|
3,150
|
1,375
|
1,775
|
|||
42,244 sq ft Fargo 1320 45th Street N - Fargo, ND
|
2013-05-13
|
4,700
|
4,100
|
600
|
|||
49,620 sq ft Metal Improvement Company - New Brighton, MN
|
2013-05-13
|
2,350
|
1,949
|
401
|
|||
172,057 sq ft Roseville 2929 Long Lake Road - Roseville, MN
|
2013-05-13
|
9,275
|
9,998
|
(723)
|
|||
322,751 sq ft Brooklyn Park 7401 Boone Ave - Brooklyn Park, MN
|
2013-09-12
|
12,800
|
12,181
|
619
|
|||
50,400 sq ft Cedar Lake Business Center - St. Louis Park, MN
|
2013-09-12
|
2,550
|
2,607
|
(57)
|
|||
35,000 sq ft API Building - Duluth, MN
|
2013-09-24
|
2,553
|
1,488
|
1,065
|
|||
59,292 sq ft Lighthouse - Duluth, MN
|
2013-10-08
|
1,825
|
1,547
|
278
|
|||
606,006 sq ft Dixon Avenue Industrial Park - Des Moines, IA
|
2013-10-31
|
14,675
|
10,328
|
4,347
|
|||
41,685 sq ft Winsted Industrial Building - Winsted, MN
|
2014-01-17
|
725
|
747
|
(22)
|
|||
69,984 sq ft Minnetonka 13600 County Road 62 - Minnetonka, MN
|
2014-01-30
|
3,800
|
3,084
|
716
|
|||
42,510 sq ft Clive 2075 NW 94th Street - Clive, IA
|
2014-01-30
|
2,735
|
2,675
|
60
|
|||
61,138
|
52,079
|
9,059
|
|||||
Retail
|
|||||||
23,187 sq ft Eagan Community - Eagan, MN
|
2013-05-14
|
2,310
|
2,420
|
(110)
|
|||
10,625 sq ft Anoka Strip Center- Anoka, MN
|
2013-12-23
|
325
|
347
|
(22)
|
|||
8,400 sq ft Burnsville 2 Strip Center - Burnsville, MN
|
2014-01-08
|
650
|
796
|
(146)
|
|||
3,285
|
3,563
|
(278)
|
|||||
Total Property Dispositions
|
$
|
80,883
|
$
|
73,884
|
$
|
6,999
|
Fiscal year ended April 30,
|
(in thousands)
|
|
2015 (remainder)
|
$
|
22,390
|
2016
|
130,203
|
|
2017
|
203,510
|
|
2018
|
88,039
|
|
2019
|
134,503
|
|
Thereafter
|
427,534
|
|
Total payments
|
$
|
1,006,179
|
(in thousands)
|
||||||||
January 31, 2015
|
||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||
ASSETS:
|
||||||||
Real estate investments
|
$
|
695
|
$
|
0
|
$
|
0
|
$
|
695
|
Real estate held for sale
|
44,259
|
0
|
0
|
44,259
|
(in thousands)
|
||||||||
April 30, 2014
|
||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||
ASSETS:
|
||||||||
Real estate investments
|
$
|
89,537
|
$
|
0
|
$
|
0
|
$
|
89,537
|
Real estate held for sale
|
2,951
|
0
|
0
|
2,951
|
(in thousands)
|
||||||||
January 31, 2015
|
April 30, 2014
|
|||||||
Carrying Amount
|
Fair Value
|
Carrying Amount
|
Fair Value
|
|||||
FINANCIAL ASSETS
|
||||||||
Cash and cash equivalents
|
$
|
52,148
|
$
|
52,148
|
$
|
47,267
|
$
|
47,267
|
Other investments
|
329
|
329
|
329
|
329
|
||||
FINANCIAL LIABILITIES
|
||||||||
Other debt
|
132,183
|
131,856
|
63,132
|
63,250
|
||||
Line of credit
|
50,500
|
50,500
|
22,500
|
22,500
|
||||
Mortgages payable
|
1,006,179
|
1,217,825
|
997,689
|
1,130,262
|
(in thousands)
|
||
Balance at April 30, 2014
|
$
|
6,203
|
Net income
|
137
|
|
Balance at January 31, 2015
|
$
|
6,340
|
(in thousands)
|
||
Balance at April 30, 2013
|
$
|
5,937
|
Net income
|
176
|
|
Balance at January 31, 2014
|
$
|
6,113
|
Class of shares/units
|
Quarterly Amount
per Share or Unit
|
Record Date
|
Payment Date
|
||
Common shares and limited partnership units
|
$0.1300
|
|
March 16, 2015
|
|
April 1, 2015
|
Preferred shares:
|
|||||
Series A
|
$0.5156
|
|
March 16, 2015
|
|
March 31, 2015
|
Series B
|
$0.4968
|
|
March 16, 2015
|
|
March 31, 2015
|
·
|
A total of 473 apartment units placed in service at the following development projects: Commons at Southgate in Minot, North Dakota; Red 20 in Minneapolis, Minnesota; Cypress Court II in St. Cloud, Minnesota; Arcata in Golden Valley, Minnesota and Renaissance Heights in Williston, North Dakota. The 4,998-square foot Minot Wells Fargo Bank retail property placed in service in Minot, North Dakota.
|
·
|
The announcement that the Company is exploring the calendar year 2015 disposition of substantially all of its office and retail properties, in an update to its current strategic plan, under which the Company has been directing new investments primarily toward multi-family residential and healthcare properties.
|
·
|
The disposition of an office property in Maple Grove, Minnesota and a retail property in Fargo, North Dakota for sales prices totaling $10.0 million.
|
·
|
The resignations from the Company's Board of Trustees of W. David Scott and John Reed, and the election of Terrance P. Maxwell to the Board of Trustees.
|
·
|
The substantial completion of two development projects placed in service during the quarter: the 132-unit Cypress Court multi-family residential property in St. Cloud, Minnesota, owned by a joint venture entity in which the Company has an approximately 86% interest, and the 146-unit River Ridge multi-family residential property in Bismarck, North Dakota.
|
·
|
The sale of two multi-family residential properties, three commercial industrial properties and two commercial retail properties for a total sales price of $11.7 million.
|
·
|
The entrance into an Amended and Restated Loan Agreement with First International Bank & Trust, a North Dakota state bank, as lender, under which First International has agreed to provide a revolving credit facility with a commitment amount at the time of close of $72 million. At the discretion of First International, the total commitment available under the credit facility may be increased to $75 million. The Loan Agreement amends and restates IRET Properties' previous secured line of credit with First International and participant banks.
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
Real estate rentals
|
$
|
60,440
|
$
|
56,156
|
$
|
4,284
|
7.6%
|
$
|
176,401
|
$
|
164,256
|
$
|
12,145
|
7.4%
|
Tenant reimbursement
|
11,513
|
11,473
|
40
|
0.3%
|
33,431
|
34,243
|
(812)
|
(2.4)%
|
||||||
TRS senior housing revenue
|
963
|
804
|
159
|
19.8%
|
2,599
|
804
|
1,795
|
223.3%
|
||||||
TOTAL REVENUE
|
72,916
|
68,433
|
4,483
|
6.6%
|
212,431
|
199,303
|
13,128
|
6.6%
|
||||||
Depreciation/amortization related to real estate investments
|
16,834
|
16,733
|
101
|
0.6%
|
49,846
|
51,156
|
(1,310)
|
(2.6)%
|
||||||
Utilities
|
5,367
|
5,042
|
325
|
6.4%
|
15,141
|
15,173
|
(32)
|
(0.2)%
|
||||||
Maintenance
|
7,799
|
7,828
|
(29)
|
(0.4)%
|
23,391
|
22,719
|
672
|
3.0%
|
||||||
Real estate taxes
|
8,816
|
7,679
|
1,137
|
14.8%
|
25,583
|
24,415
|
1,168
|
4.8%
|
||||||
Insurance
|
1,479
|
1,190
|
289
|
24.3%
|
4,560
|
3,904
|
656
|
16.8%
|
||||||
Property management expenses
|
4,746
|
4,064
|
682
|
16.8%
|
13,731
|
12,383
|
1,348
|
10.9%
|
||||||
Other property expenses
|
227
|
124
|
103
|
83.1%
|
783
|
304
|
479
|
157.6%
|
||||||
TRS senior housing expenses
|
825
|
671
|
154
|
23.0%
|
2,243
|
671
|
1,572
|
234.3%
|
||||||
General and administrative
|
3,242
|
2,935
|
307
|
10.5%
|
10,986
|
9,572
|
1,414
|
14.8%
|
||||||
Amortization related to non-real estate investments
|
916
|
756
|
160
|
21.2%
|
2,628
|
2,500
|
128
|
5.1%
|
||||||
Impairment of real estate investments
|
540
|
4,798
|
(4,258)
|
(88.7)%
|
6,105
|
4,798
|
1,307
|
27.2%
|
||||||
TOTAL EXPENSES
|
50,791
|
51,820
|
(1,029)
|
(2.0)%
|
154,997
|
147,595
|
7,402
|
5.0%
|
||||||
Gain on involuntary conversion
|
0
|
1,514
|
(1,514)
|
(100.0)%
|
0
|
2,480
|
(2,480)
|
(100.0)%
|
||||||
Operating income
|
22,125
|
18,127
|
3,998
|
22.1%
|
57,434
|
54,188
|
3,246
|
6.0%
|
||||||
Interest expense
|
(14,595)
|
(15,130)
|
535
|
(3.5)%
|
(43,858)
|
(44,525)
|
667
|
(1.5)%
|
||||||
Interest income
|
561
|
573
|
(12)
|
(2.1)%
|
1,681
|
1,346
|
335
|
24.9%
|
||||||
Other income
|
109
|
34
|
75
|
220.6%
|
376
|
123
|
253
|
205.7%
|
||||||
Income before gain (loss) on sale of real estate and other investments and income from discontinued operations
|
8,200
|
3,604
|
4,596
|
127.5%
|
15,633
|
11,132
|
4,501
|
40.4%
|
||||||
Gain (loss) on sale of real estate and other investments
|
951
|
0
|
951
|
n/a
|
(811)
|
0
|
(811)
|
n/a
|
||||||
Income from continuing operations
|
9,151
|
3,604
|
5,547
|
153.9%
|
14,822
|
11,132
|
3,690
|
33.1%
|
||||||
Income from discontinued operations
|
0
|
465
|
(465)
|
(100.0)%
|
0
|
6,450
|
(6,450)
|
(100.0)%
|
||||||
NET INCOME
|
9,151
|
4,069
|
5,082
|
124.9%
|
14,822
|
17,582
|
(2,760)
|
(15.7)%
|
||||||
Net income attributable to noncontrolling interests – Operating Partnership
|
(657)
|
(130)
|
(527)
|
405.4%
|
(618)
|
(1,406)
|
788
|
(56.0)%
|
||||||
Net income attributable to noncontrolling interests – consolidated real estate entities
|
(123)
|
(436)
|
313
|
(71.8)%
|
(870)
|
(808)
|
(62)
|
7.7%
|
||||||
Net income attributable to Investors Real Estate Trust
|
8,371
|
3,503
|
4,868
|
139.0%
|
13,334
|
15,368
|
(2,034)
|
(13.2)%
|
||||||
Dividends to preferred shareholders
|
(2,879)
|
(2,879)
|
0
|
0.0%
|
(8,636)
|
(8,636)
|
0
|
0.0%
|
||||||
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS
|
$
|
5,492
|
$
|
624
|
4,868
|
780.1%
|
$
|
4,698
|
$
|
6,732
|
(2,034)
|
(30.2)%
|
(in thousands)
|
||
Increase in Total
Revenue
Three Months
ended January 31, 2015
|
||
Rent in Fiscal 2015 primarily from properties acquired and development projects placed in service in Fiscal 2015
|
$
|
2,153
|
Rent in Fiscal 2015 primarily from properties acquired and development projects placed in service in Fiscal 2014 in excess of that received in Fiscal 2014 from the same properties
|
1,778
|
|
Increase in rent on same-store properties, excluding straight line rent(1)
|
1,925
|
|
Net change in straight line rent on same-store properties(1)
|
(1,052)
|
|
Decrease in rent from properties sold or classified as held for sale in Fiscal 2015 and 2014
|
(480)
|
|
TRS senior housing revenue in excess of that received in Fiscal 2014(2)
|
159
|
|
Net increase in total revenue
|
$
|
4,483
|
(1)
|
See analysis of NOI by segment on pages 37-42 of the MD&A for additional information.
|
(2)
|
See discussion in TRS Senior Housing Expenses paragraph below.
|
(in thousands)
|
||
Increase in Total
Revenue
Nine Months
ended January 31, 2015
|
||
Rent in Fiscal 2015 primarily from properties acquired and development projects placed in service in Fiscal 2015
|
$
|
3,822
|
Rent in Fiscal 2015 primarily from properties acquired and development projects placed in service in Fiscal 2014 in excess of that received in Fiscal 2014 from the same properties
|
6,108
|
|
Increase in rent on same-store properties, excluding straight line rent(1)
|
4,018
|
|
Net change in straight line rent on same-store properties(1)
|
(2,097)
|
|
Decrease in rent from properties sold or classified as held for sale in Fiscal 2015 and 2014
|
(518)
|
|
TRS senior housing revenue in excess of that received in Fiscal 2014(2)
|
1,795
|
|
Net increase in total revenue
|
$
|
13,128
|
(1)
|
See analysis of NOI by segment on pages 37-42 of the MD&A for additional information.
|
(2)
|
See discussion in TRS Senior Housing Expenses paragraph below.
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
Mortgage debt
|
$
|
13,396
|
$
|
14,156
|
$
|
(760)
|
(5.4)%
|
$
|
40,388
|
$
|
42,533
|
$
|
(2,145)
|
(5.0)%
|
Line of credit
|
494
|
164
|
330
|
201.2%
|
1,363
|
427
|
936
|
219.2%
|
||||||
Other
|
705
|
810
|
(105)
|
(13.0)%
|
2,107
|
1,565
|
542
|
34.6%
|
||||||
Total interest expense
|
$
|
14,595
|
$
|
15,130
|
$
|
(535)
|
(3.5)%
|
$
|
43,858
|
$
|
44,525
|
$
|
(667)
|
(1.5)%
|
Same-Store Properties
|
All Properties
|
||||
As of January 31,
|
As of January 31,
|
||||
Segments
|
2015
|
2014
|
2015
|
2014
|
|
Multi-Family Residential
|
94.0%
|
92.8%
|
91.3%
|
91.8%
|
|
Office
|
84.1%
|
84.5%
|
81.9%
|
80.4%
|
|
Healthcare
|
95.8%
|
96.4%
|
95.8%
|
96.4%
|
|
Industrial
|
100.0%
|
100.0%
|
100.0%
|
86.2%
|
|
Retail
|
83.5%
|
87.7%
|
83.8%
|
86.9%
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
All Segments
|
||||||||||||||
Real estate revenue
|
||||||||||||||
Same-store
|
$
|
64,436
|
$
|
63,563
|
$
|
873
|
1.4%
|
$
|
189,863
|
$
|
187,942
|
$
|
1,921
|
1.0%
|
Non-same-store(1)
|
7,517
|
4,066
|
3,451
|
84.9%
|
19,969
|
10,557
|
9,412
|
89.2%
|
||||||
Total
|
$
|
71,953
|
$
|
67,629
|
$
|
4,324
|
6.4%
|
$
|
209,832
|
$
|
198,499
|
$
|
11,333
|
5.7%
|
Real estate expenses
|
||||||||||||||
Same-store
|
$
|
25,743
|
$
|
23,897
|
$
|
1,846
|
7.7%
|
$
|
75,850
|
$
|
73,419
|
$
|
2,431
|
3.3%
|
Non-same-store(1)
|
2,691
|
2,030
|
661
|
32.6%
|
7,339
|
5,479
|
1,860
|
33.9%
|
||||||
Total
|
$
|
28,434
|
$
|
25,927
|
$
|
2,507
|
9.7%
|
$
|
83,189
|
$
|
78,898
|
$
|
4,291
|
5.4%
|
Gain on involuntary conversion
|
||||||||||||||
Same-store
|
$
|
0
|
$
|
0
|
$
|
0
|
n/a
|
$
|
0
|
$
|
0
|
$
|
0
|
n/a
|
Non-same-store(1)
|
0
|
1,514
|
(1,514)
|
(100.0)%
|
0
|
2,480
|
(2,480)
|
(100.0)%
|
||||||
Total
|
$
|
0
|
$
|
1,514
|
$
|
(1,514)
|
(100.0)%
|
$
|
0
|
$
|
2,480
|
$
|
(2,480)
|
(100.0)%
|
Net operating income
|
||||||||||||||
Same-store
|
$
|
38,693
|
$
|
39,666
|
$
|
(973)
|
(2.5)%
|
$
|
114,013
|
$
|
114,523
|
$
|
(510)
|
(0.4)%
|
Non-same-store(1)
|
4,826
|
3,550
|
1,276
|
35.9%
|
12,630
|
7,558
|
5,072
|
67.1%
|
||||||
Total
|
$
|
43,519
|
$
|
43,216
|
$
|
303
|
0.7%
|
$
|
126,643
|
$
|
122,081
|
$
|
4,562
|
3.7%
|
TRS senior housing revenue
|
963
|
0
|
2,599
|
0
|
||||||||||
TRS senior housing expenses
|
(825)
|
0
|
(2,243)
|
0
|
||||||||||
Depreciation/amortization
|
(17,750)
|
(17,489)
|
(52,474)
|
(53,656)
|
||||||||||
General and administrative
|
(3,242)
|
(2,935)
|
(10,986)
|
(9,572)
|
||||||||||
Impairment of real estate investments
|
(540)
|
(4,798)
|
(6,105)
|
(4,798)
|
||||||||||
Interest expense
|
(14,595)
|
(15,130)
|
(43,858)
|
(44,525)
|
||||||||||
Interest and other income
|
670
|
740
|
2,057
|
1,602
|
||||||||||
Income before loss on sale of real estate and other investments and income from discontinued operations
|
8,200
|
3,604
|
15,633
|
11,132
|
||||||||||
Gain (loss) on sale of real estate and other investments
|
951
|
0
|
(811)
|
0
|
||||||||||
Income from continuing operations
|
9,151
|
3,604
|
14,822
|
11,132
|
||||||||||
Income from discontinued operations(2)
|
0
|
465
|
0
|
6,450
|
||||||||||
Net income
|
$
|
9,151
|
$
|
4,069
|
$
|
14,822
|
$
|
17,582
|
(1)
|
Non-same-store properties consist of the following properties (re-development and in-service development properties are listed in bold type):
|
|
Multi-Family Residential -
|
Arcata, Golden Valley, MN; Colonial Villa, Burnsville, MN; Commons at Southgate, Minot, ND; Cypress Court I and II, St. Cloud, MN; Dakota Commons, Williston, ND; Homestead Garden, Rapid City, SD; Landing at Southgate, Minot, ND; Northridge, Bismarck, ND; Pinecone Villas, Sartell, MN; Red 20, Minneapolis, MN; Renaissance Heights, Williston, ND; River Ridge, Bismarck, ND; Silver Springs, Rapid City, SD and Southpoint, Grand Forks, ND.
Total number of units, 1,870.
|
|
Healthcare -
|
Spring Creek Fruitland, Fruitland, ID.
Total rentable square footage, 39,500.
|
|
Industrial -
|
Roseville 3075 Long Lake Road, Roseville, MN.
Total rentable square footage, 17,750.
|
|
Retail -
|
Minot Wells Fargo Bank, Minot, ND.
Total rentable square footage, 4,998.
|
Held for Sale -
|
Office -
|
2030 Cliff Road, Eagan, MN; Burnsville Bluffs II, Burnsville, MN; Northgate II, Maple Grove, MN; Plymouth I, Plymouth, MN; Plymouth II, Plymouth, MN; Plymouth III, Plymouth, MN; Plymouth IV-V, Plymouth, MN; Southeast Tech, Eagan, MN; Thresher Square, Minneapolis, MN and Whitewater Plaza, Minnetonka, MN.
Total rentable square footage, 526,469.
|
Healthcare -
|
Jamestown Medical Office Building, Jamestown, ND.
Total rentable square footage, 45,222.
|
|
Retail -
|
Weston Walgreens, Weston, WI.
Total rentable square footage, 14,820.
|
|
Total NOI for held for sale properties for the three months ended January 31, 2015 and 2014, respectively, $940 and $743.
Total NOI for held for sale properties for the nine months ended January 31, 2015 and 2014, respectively, $2,695 and $2,272.
|
Sold -
|
Multi-Family Residential -
|
Lancaster, St. Cloud, MN.
|
Office -
|
Dewey Hill Business Center, Edina, MN; Northgate I, Maple Grove, MN and Wirth Corporate Center, Golden Valley, MN.
|
|
Industrial -
|
Eagan 2785 & 2795 Hwy 55, Eagan, MN.
|
|
Retail -
|
Fargo Express Community, Fargo, ND; Kalispell Retail Center, Kalispell, MT and Weston Retail, Weston, WI.
|
|
Total NOI for sold properties for the three months ended January 31, 2015 and 2014, respectively, $65 and $270.
Total NOI for sold properties for the nine months ended January 31, 2015 and 2014, respectively, $751 and $771.
|
(2)
|
Discontinued operations include gain on disposals and income from operations for:
|
2014 Dispositions – Anoka Strip Center, API Building, Bloomington Business Plaza, Bodycote Industrial Building, Brooklyn Park 7401 Boone Ave, Burnsville 2 Strip Center, Cedar Lake Business Center, Clive 2075 NW 94th Street, Dixon Avenue Industrial Park, Eagan Community, East Park, Fargo 1320 45th Street N, Lighthouse, Metal Improvement Company, Minnetonka 13600 County Road 62, Nicollet VII, Pillsbury Business Center, Roseville 2929 Long Lake Road, Sycamore Village and Winsted Industrial Building.
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
Multi-Family Residential
|
||||||||||||||
Real estate revenue
|
||||||||||||||
Same-store
|
$
|
24,773
|
$
|
23,911
|
$
|
862
|
3.6%
|
$
|
74,206
|
$
|
71,889
|
$
|
2,317
|
3.2%
|
Non-same-store
|
5,483
|
1,937
|
3,546
|
183.1%
|
13,370
|
3,770
|
9,600
|
254.6%
|
||||||
Total
|
$
|
30,256
|
$
|
25,848
|
$
|
4,408
|
17.1%
|
$
|
87,576
|
$
|
75,659
|
$
|
11,917
|
15.1%
|
Real estate expenses
|
||||||||||||||
Same-store
|
$
|
11,441
|
$
|
10,187
|
$
|
1,254
|
12.3%
|
$
|
33,113
|
$
|
31,111
|
$
|
2,002
|
6.4%
|
Non-same-store
|
1,877
|
811
|
1,066
|
131.4%
|
4,587
|
1,895
|
2,692
|
142.1%
|
||||||
Total
|
$
|
13,318
|
$
|
10,998
|
$
|
2,320
|
21.1%
|
$
|
37,700
|
$
|
33,006
|
$
|
4,694
|
14.2%
|
Gain on involuntary conversion
|
||||||||||||||
Same-store
|
$
|
0
|
$
|
0
|
$
|
0
|
n/a
|
$
|
0
|
$
|
0
|
$
|
0
|
n/a
|
Non-same-store
|
0
|
1,514
|
(1,514)
|
(100.0)%
|
0
|
2,480
|
(2,480)
|
(100.0)%
|
||||||
Total
|
$
|
0
|
$
|
1,514
|
$
|
(1,514)
|
(100.0)%
|
$
|
0
|
$
|
2,480
|
$
|
(2,480)
|
(100.0)%
|
Net operating income
|
||||||||||||||
Same-store
|
$
|
13,332
|
$
|
13,724
|
$
|
(392)
|
(2.9)%
|
$
|
41,093
|
$
|
40,778
|
$
|
315
|
0.8%
|
Non-same-store
|
3,606
|
2,640
|
966
|
36.6%
|
8,783
|
4,355
|
4,428
|
101.7%
|
||||||
Total
|
$
|
16,938
|
$
|
16,364
|
$
|
574
|
3.5%
|
$
|
49,876
|
$
|
45,133
|
$
|
4,743
|
10.5%
|
Occupancy
|
2015
|
2014
|
|
Same-store
|
94.0%
|
92.8%
|
|
Non-same-store
|
77.1%
|
79.9%
|
|
Total
|
91.3%
|
91.8%
|
Number of Units
|
2015
|
2014
|
|
Same-store
|
9,895
|
9,896
|
|
Non-same-store
|
1,870
|
829
|
|
Total
|
11,765
|
10,725
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
Office
|
||||||||||||||
Real estate revenue
|
||||||||||||||
Same-store
|
$
|
17,798
|
$
|
17,852
|
$
|
(54)
|
(0.3)%
|
$
|
52,645
|
$
|
53,539
|
$
|
(894)
|
(1.7)%
|
Non-same-store
|
1,288
|
1,542
|
(254)
|
(16.5)%
|
4,272
|
4,536
|
(264)
|
(5.8)%
|
||||||
Total
|
$
|
19,086
|
$
|
19,394
|
$
|
(308)
|
(1.6)%
|
$
|
56,917
|
$
|
58,075
|
$
|
(1,158)
|
(2.0)%
|
Real estate expenses
|
||||||||||||||
Same-store
|
$
|
8,420
|
$
|
8,094
|
$
|
326
|
4.0%
|
$
|
25,701
|
$
|
25,565
|
$
|
136
|
0.5%
|
Non-same-store
|
630
|
943
|
(313)
|
(33.2)%
|
2,172
|
2,750
|
(578)
|
(21.0)%
|
||||||
Total
|
$
|
9, 050
|
$
|
9,037
|
$
|
13
|
0.1%
|
$
|
27,873
|
$
|
28,315
|
$
|
(442)
|
(1.6)%
|
Net operating income
|
||||||||||||||
Same-store
|
$
|
9,378
|
$
|
9,758
|
$
|
(380)
|
(3.9)%
|
$
|
26,944
|
$
|
27,974
|
$
|
(1,030)
|
(3.7)%
|
Non-same-store
|
658
|
599
|
59
|
9.9%
|
2,100
|
1,786
|
314
|
17.6%
|
||||||
Total
|
$
|
10,036
|
$
|
10,357
|
$
|
(321)
|
(3.1)%
|
$
|
29,044
|
$
|
29,760
|
$
|
(716)
|
(2.4)%
|
Occupancy
|
2015
|
2014
|
|
Same-store
|
84.1%
|
84.5%
|
|
Non-same-store
|
64.2%
|
58.2%
|
|
Total
|
81.9%
|
80.4%
|
Rentable Square Footage
|
2015
|
2014
|
|
Same-store
|
4,078,338
|
4,077,797
|
|
Non-same-store
|
526,469
|
753,666
|
|
Total
|
4,604,807
|
4,831,463
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
Healthcare
|
||||||||||||||
Real estate revenue
|
||||||||||||||
Same-store
|
$
|
17,041
|
$
|
16,969
|
$
|
72
|
0.4%
|
$
|
48,843
|
$
|
48,470
|
$
|
373
|
0.8%
|
Non-same-store
|
546
|
273
|
273
|
100.0%
|
1,479
|
870
|
609
|
70.0%
|
||||||
Total
|
$
|
17,587
|
$
|
17,242
|
$
|
345
|
2.0%
|
$
|
50,322
|
$
|
49,340
|
$
|
982
|
2.0%
|
Real estate expenses
|
||||||||||||||
Same-store
|
$
|
4,204
|
$
|
4,064
|
$
|
140
|
3.4%
|
$
|
12,562
|
$
|
12,313
|
$
|
249
|
2.0%
|
Non-same-store
|
111
|
56
|
55
|
98.2%
|
343
|
221
|
122
|
55.2%
|
||||||
Total
|
$
|
4,315
|
$
|
4,120
|
$
|
195
|
4.7%
|
$
|
12,905
|
$
|
12,534
|
$
|
371
|
3.0%
|
Net operating income
|
||||||||||||||
Same-store
|
$
|
12,837
|
$
|
12,905
|
$
|
(68)
|
(0.5)%
|
$
|
36,281
|
$
|
36,157
|
$
|
124
|
0.3%
|
Non-same-store
|
435
|
217
|
218
|
100.5%
|
1,136
|
649
|
487
|
75.0%
|
||||||
Total
|
$
|
13,272
|
$
|
13,122
|
$
|
150
|
1.1%
|
$
|
37,417
|
$
|
36,806
|
$
|
611
|
1.7%
|
Occupancy
|
2015
|
2014
|
|
Same-store
|
95.8%
|
96.4%
|
|
Non-same-store
|
95.6%
|
91.7%
|
|
Total
|
95.8%
|
96.4%
|
Rentable Square Footage
|
2015
|
2014
|
|
Same-store
|
2,910,876
|
2,910,994
|
|
Non-same-store
|
84,722
|
143,396
|
|
Total
|
2,995,598
|
3,054,390
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
Industrial
|
||||||||||||||
Real estate revenue
|
||||||||||||||
Same-store
|
$
|
1,705
|
$
|
1,595
|
$
|
110
|
6.9%
|
$
|
4,758
|
$
|
4,654
|
$
|
104
|
2.2%
|
Non-same-store
|
36
|
69
|
(33)
|
(47.8)%
|
146
|
619
|
(473)
|
(76.4)%
|
||||||
Total
|
$
|
1,741
|
$
|
1,664
|
$
|
77
|
4.6%
|
$
|
4,904
|
$
|
5,273
|
$
|
(369)
|
(7.0)%
|
Real estate expenses
|
||||||||||||||
Same-store
|
$
|
458
|
$
|
336
|
$
|
122
|
36.3%
|
$
|
1,105
|
$
|
1,024
|
$
|
81
|
7.9%
|
Non-same-store
|
43
|
157
|
(114)
|
(72.6)%
|
118
|
423
|
(305)
|
(72.1)%
|
||||||
Total
|
$
|
501
|
$
|
493
|
$
|
8
|
1.6%
|
$
|
1,223
|
$
|
1,447
|
$
|
(224)
|
(15.5)%
|
Net operating income
|
||||||||||||||
Same-store
|
$
|
1,247
|
$
|
1,259
|
$
|
(12)
|
(1.0)%
|
$
|
3,653
|
$
|
3,630
|
$
|
23
|
0.6%
|
Non-same-store
|
(7)
|
(88)
|
81
|
(92.0)%
|
28
|
196
|
(168)
|
(85.7)%
|
||||||
Total
|
$
|
1,240
|
$
|
1,171
|
$
|
69
|
5.9%
|
$
|
3,681
|
$
|
3,826
|
$
|
(145)
|
(3.8)%
|
Occupancy
|
2015
|
2014
|
|
Same-store
|
100.0%
|
100.0%
|
|
Non-same-store
|
100.0%
|
22.1%
|
|
Total
|
100.0%
|
86.2%
|
Rentable Square Footage
|
2015
|
2014
|
|
Same-store
|
1,002,361
|
1,002,361
|
|
Non-same-store
|
17,750
|
216,350
|
|
Total
|
1,020,111
|
1,218,711
|
(in thousands, except percentages)
|
||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||
January 31
|
2015 vs 2014
|
January 31
|
2015 vs 2014
|
|||||||||||
2015
|
2014
|
$ Change
|
% Change
|
2015
|
2014
|
$ Change
|
% Change
|
|||||||
Retail
|
||||||||||||||
Real estate revenue
|
||||||||||||||
Same-store
|
$
|
3,119
|
$
|
3,236
|
$
|
(117)
|
(3.6)%
|
$
|
9,411
|
$
|
9,390
|
$
|
21
|
0.2%
|
Non-same-store
|
164
|
245
|
(81)
|
(33.1)%
|
702
|
762
|
(60)
|
(7.9)%
|
||||||
Total
|
$
|
3,283
|
$
|
3,481
|
$
|
(198)
|
(5.7)%
|
$
|
10,113
|
$
|
10,152
|
$
|
(39)
|
(0.4)%
|
Real estate expenses
|
||||||||||||||
Same-store
|
$
|
1,220
|
$
|
1,216
|
$
|
4
|
0.3%
|
$
|
3,369
|
$
|
3,406
|
$
|
(37)
|
(1.1)%
|
Non-same-store
|
30
|
63
|
(33)
|
(52.4)%
|
119
|
190
|
(71)
|
(37.4)%
|
||||||
Total
|
$
|
1,250
|
$
|
1,279
|
$
|
(29)
|
(2.3)%
|
$
|
3,488
|
$
|
3,596
|
$
|
(108)
|
(3.0)%
|
Net operating income
|
||||||||||||||
Same-store
|
$
|
1,899
|
$
|
2,020
|
$
|
(121)
|
(6.0)%
|
$
|
6,042
|
$
|
5,984
|
$
|
58
|
1.0%
|
Non-same-store
|
134
|
182
|
(48)
|
(26.4)%
|
583
|
572
|
11
|
1.9%
|
||||||
Total
|
$
|
2,033
|
$
|
2,202
|
$
|
(169)
|
(7.7)%
|
$
|
6,625
|
$
|
6,556
|
$
|
69
|
1.1%
|
Occupancy
|
2015
|
2014
|
|
Same-store
|
83.5%
|
87.7%
|
|
Non-same-store
|
100.0%
|
79.8%
|
|
Total
|
83.8%
|
86.9%
|
Rentable Square Footage
|
2015
|
2014
|
|
Same-store
|
1,184,736
|
1,181,632
|
|
Non-same-store
|
19,818
|
126,690
|
|
Total
|
1,204,554
|
1,308,322
|
Lessee
|
% of Total Commercial
Segments' Minimum Rents
as of January 1, 2015
|
Affiliates of Edgewood Vista
|
14.8%
|
Fairview Health Services
|
3.8%
|
St. Luke's Hospital of Duluth, Inc.
|
3.5%
|
Applied Underwriters
|
2.4%
|
HealthEast Care System
|
1.8%
|
Microsoft (NASDAQ: MSFT)
|
1.4%
|
Affiliates of Siemens USA (NYSE: SI)
|
1.4%
|
Arcadis Corporate Services, Inc.
|
1.4%
|
Nebraska Orthopaedic Hospital(1)
|
1.4%
|
State of Idaho Department of Health and Welfare
|
1.2%
|
All Others
|
66.9%
|
Total Monthly Commercial Rent as of January 1, 2015
|
100.0%
|
(1)
|
The tenant in the Company's Nebraska Orthopaedic Hospital property has exercised its option to purchase the property. The Company and its tenant are currently engaged in an arbitration proceeding pursuant to the lease agreement to determine the purchase price. The Company currently can give no assurance that the sale of the property pursuant to the purchase option will be completed.
|
Square Feet of
New Leases(1)
|
Square Feet of
Leases Renewed(1)
|
Total
Square Feet of
Leases Executed(1)
|
Occupancy
|
||||||
Segments
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
|
Office
|
37,076
|
64,288
|
63,091
|
80,424
|
100,167
|
144,712
|
84.1%
|
80.4%
|
|
Healthcare
|
6,400
|
175
|
7,703
|
17,734
|
14,103
|
17,909
|
95.8%
|
96.4%
|
|
Industrial
|
0
|
64,000
|
29,995
|
0
|
29,995
|
64,000
|
100.0%
|
85.6%
|
|
Retail
|
3,284
|
27,107
|
38,965
|
28,564
|
42,249
|
55,671
|
83.5%
|
86.9%
|
|
Total
|
46,760
|
155,570
|
139,754
|
126,722
|
186,514
|
282,292
|
89.5%
|
86.4%
|
(1)
|
The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP. Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period.
|
Square Feet of
New Leases(1)
|
Square Feet of
Leases Renewed(1)
|
Total
Square Feet of
Leases Executed(1)
|
Occupancy
|
||||||
Segments
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
|
Office
|
119,624
|
278,143
|
330,240
|
222,798
|
449,864
|
500,941
|
84.1%
|
80.4%
|
|
Healthcare
|
17,979
|
31,268
|
108,391
|
34,996
|
126,370
|
66,264
|
95.8%
|
96.4%
|
|
Industrial
|
0
|
234,403
|
29,995
|
251,831
|
29,995
|
486,234
|
100.0%
|
85.6%
|
|
Retail
|
51,252
|
124,966
|
182,938
|
78,257
|
234,190
|
203,223
|
83.5%
|
86.9%
|
|
Total
|
188,855
|
668,780
|
651,564
|
587,882
|
840,419
|
1,256,662
|
89.5%
|
86.4%
|
(1) | The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP. Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. |
Square Feet of
New Leases(1)
|
Average Term
in Years
|
Average
Effective Rent(2)
|
Estimated Tenant Improvement Cost per Square Foot(1)
|
Leasing
Commissions per Square Foot(1)
|
|||||||||||||||||
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
||||||||||||
Office
|
37,076
|
64,288
|
4.4
|
3.6
|
$
|
14.29
|
$
|
13.85
|
$
|
15.57
|
$
|
6.76
|
$
|
5.87
|
$
|
3.20
|
|||||
Healthcare
|
6,400
|
175
|
7.5
|
0.8
|
18.51
|
13.71
|
59.06
|
0
|
6.50
|
0
|
|||||||||||
Industrial
|
0
|
64,000
|
0
|
2.8
|
0
|
3.03
|
0
|
0
|
0
|
0.03
|
|||||||||||
Retail
|
3,284
|
27,107
|
2.0
|
5.4
|
8.54
|
10.94
|
2.23
|
2.89
|
1.78
|
5.61
|
|||||||||||
Total
|
46,760
|
155,570
|
4.3
|
3.9
|
$
|
14.47
|
$
|
8.89
|
$
|
20.58
|
$
|
3.30
|
$
|
5.67
|
$
|
2.31
|
(1)
|
The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP. Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions presented are based on square feet leased during the period.
|
(2)
|
Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.
|
Square Feet of
New Leases(1)
|
Average Term
in Years
|
Average
Effective Rent(2)
|
Estimated Tenant Improvement Cost per Square Foot(1)
|
Leasing
Commissions per Square Foot(1)
|
|||||||||||||||||
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
||||||||||||
Office
|
119,624
|
278,143
|
4.6
|
4.3
|
$
|
14.00
|
$
|
14.26
|
$
|
15.65
|
$
|
13.10
|
$
|
5.33
|
$
|
4.33
|
|||||
Healthcare
|
17,979
|
31,268
|
6.1
|
4.8
|
20.00
|
21.38
|
37.16
|
49.66
|
6.84
|
6.75
|
|||||||||||
Industrial
|
0
|
234,403
|
0
|
3.1
|
0
|
3.55
|
0
|
0.13
|
0
|
0.50
|
|||||||||||
Retail
|
51,252
|
124,966
|
3.6
|
5.4
|
8.36
|
5.70
|
16.26
|
1.84
|
3.46
|
4.47
|
|||||||||||
Total
|
188,855
|
668,780
|
4.5
|
4.4
|
$
|
13.04
|
$
|
9.24
|
$
|
17.86
|
$
|
8.16
|
$
|
4.97
|
$
|
3.13
|
(1)
|
The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP. Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions presented are based on square feet leased during the period.
|
(2)
|
Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.
|
Square Feet of
Leases Renewed(1)
|
Percent of Expiring
Leases Renewed(2)
|
Average Term
in Years
|
Weighted Average
Growth (Decline)
in Effective Rents(3)
|
Estimated
Tenant Improvement
Cost per Square Foot(1)
|
Leasing
Commissions per
Square Foot(1)
|
|||||||||||||||||||
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Office
|
63,091
|
80,424
|
65.4%
|
44.4%
|
2.1
|
3.2
|
9.2%
|
(1.0%)
|
$
|
0.31
|
$
|
4.54
|
$
|
1.63
|
$
|
1.87
|
||||||||
Healthcare
|
7,703
|
17,734
|
84.5%
|
100.0%
|
16.8
|
2.3
|
1.3%
|
9.6%
|
35.00
|
0
|
7.80
|
0.02
|
||||||||||||
Industrial
|
29,995
|
0
|
0%
|
0%
|
3.0
|
0
|
(4.5%)
|
0%
|
0
|
0
|
1.21
|
0
|
||||||||||||
Retail
|
38,965
|
28,564
|
44.8%
|
100%
|
3.8
|
4.0
|
17.4%
|
13.3%
|
1.93
|
4.63
|
0
|
0.06
|
||||||||||||
Total
|
139,754
|
126,722
|
63.4%
|
55.1%
|
3.5
|
3.3
|
8.7%
|
3.6%
|
$
|
2.61
|
$
|
3.93
|
$
|
1.43
|
$
|
1.20
|
(1)
|
The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP. Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions are based on square feet leased during the period.
|
(2)
|
Renewal percentage of expiring leases is based on square footage of renewed leases and not the number of leases renewed. Beginning in the first quarter of fiscal year 2015, the category of renewed leases does not include leases that have become month-to-month leases; these month-to-month leases are considered lease amendments. Previous-period data has been revised to reflect this change.
|
(3)
|
Represents the percentage change in effective rent between the original leases and the renewal leases. Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.
|
Square Feet of
Leases Renewed(1)
|
Percent of Expiring
Leases Renewed(2)
|
Average Term
in Years
|
Weighted Average
Growth (Decline)
in Effective Rents(3)
|
Estimated
Tenant Improvement
Cost per Square Foot(1)
|
Leasing
Commissions per
Square Foot(1)
|
|||||||||||||||||||
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Office
|
330,240
|
222,798
|
64.7%
|
52.9%
|
2.6
|
3.6
|
10.8%
|
(2.4%)
|
$
|
2.38
|
$
|
4.69
|
$
|
1.57
|
$
|
3.31
|
||||||||
Healthcare
|
108,391
|
34,996
|
73.2%
|
100.0%
|
6.3
|
3.6
|
(3.5%)
|
8.8%
|
10.99
|
9.96
|
1.54
|
1.10
|
||||||||||||
Industrial
|
29,995
|
251,831
|
0.0%
|
42.3%
|
3.0
|
3.2
|
(4.5%)
|
7.5%
|
0
|
0.32
|
1.21
|
0.48
|
||||||||||||
Retail
|
182,938
|
78,257
|
46.1%
|
37.4%
|
4.0
|
3.7
|
28.1%
|
10.0%
|
1.87
|
1.88
|
0.04
|
0.05
|
||||||||||||
Total
|
651,564
|
587,882
|
59.9%
|
50.9%
|
3.7
|
3.6
|
9.1%
|
2.7%
|
$
|
3.56
|
$
|
2.76
|
$
|
1.12
|
$
|
1.53
|
(1)
|
The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP. Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions are based on square feet leased during the period.
|
(2)
|
Renewal percentage of expiring leases is based on square footage of renewed leases and not the number of leases renewed. Beginning in the first quarter of fiscal year 2015, the category of renewed leases does not include leases that have become month-to-month leases; these month-to-month leases are considered lease amendments. Previous-period data has been revised to reflect this change.
|
(3)
|
Represents the percentage change in effective rent between the original leases and the renewal leases. Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.
|
Fiscal Year of Lease Expiration
|
# of Leases
|
Square Footage of
Expiring Leases(3)
|
Percentage of Total
Commercial Segments
Leased Square Footage
|
Annualized Base
Rent of Expiring Leases at Expiration(2) |
Percentage of Total
Commercial Segments
Annualized Base Rent
|
|||
2015(remainder)(1)
|
63
|
439,791
|
5.1%
|
$
|
5,194,075
|
4.5%
|
||
2016
|
124
|
1,051,087
|
12.2%
|
12,563,469
|
10.9%
|
|||
2017
|
145
|
1,239,131
|
14.4%
|
19,394,557
|
16.8%
|
|||
2018
|
103
|
772,479
|
8.9%
|
11,874,316
|
10.3%
|
|||
2019
|
88
|
1,290,169
|
15.0%
|
17,851,438
|
15.5%
|
|||
2020
|
57
|
677,871
|
7.8%
|
7,981,396
|
6.9%
|
|||
2021
|
51
|
430,125
|
5.0%
|
6,096,329
|
5.3%
|
|||
2022
|
46
|
1,386,552
|
16.1%
|
17,577,646
|
15.3%
|
|||
2023
|
16
|
499,626
|
5.8%
|
2,519,283
|
2.2%
|
|||
2024
|
43
|
405,254
|
4.7%
|
6,313,940
|
5.5%
|
|||
Thereafter
|
25
|
432,096
|
5.0%
|
7,825,276
|
6.8%
|
|||
Totals
|
761
|
8,624,181
|
100.0%
|
$
|
115,191,725
|
100.0%
|
(1)
|
Includes month-to-month leases. As of January 31, 2015 month-to-month leases accounted for 342,968 square feet.
|
(2)
|
Annualized Base Rent is monthly scheduled rent as of January 1, 2015, multiplied by 12.
|
(3)
|
Assuming that none of the tenants exercise renewal or termination options, and including leases renewed prior to expiration. Also excludes 143,024 square feet of space occupied by IRET.
|
(in thousands)
|
(in fiscal years)
|
||||||||||
Project Name and Location
|
Segment
|
Total Rentable
Square Feet
or Number of Units
|
Percentage
Leased or Committed
|
Anticipated
Total
Cost(1)
|
Costs as of January 31, 2015(1)
|
Cost per
Square Foot
or Unit(1)
|
Date Placed in Service
|
Anticipated Same-Store Date
|
|||
Dakota Commons - Williston, ND
|
Multi-Family Residential
|
44 units
|
100%
|
$
|
10,736
|
$
|
10,419
|
$
|
244,000
|
Q1 2015
|
Q1 2017
|
Commons at Southgate - Minot, ND(2)
|
Multi-Family Residential
|
233 units
|
85.8%
|
37,201
|
34,612
|
159,661
|
Q3 2015
|
Q1 2017
|
|||
Minot Wells Fargo Bank - Minot, ND
|
Retail
|
4,998 sq ft
|
100%
|
3,288
|
3,185
|
658
|
Q3 2015
|
Q1 2017
|
|||
Cypress Court II – St. Cloud, MN(3)
|
Multi-Family Residential
|
64 units
|
50.0%
|
7,028
|
6,638
|
109,813
|
Q3 2015
|
Q1 2017
|
|||
Arcata - Golden Valley, MN
|
Multi-Family Residential
|
165 units
|
9.1%
|
33,448
|
30,384
|
202,715
|
Q3 2015
|
Q1 2017
|
|||
Red 20 - Minneapolis, MN(4)
|
Multi-Family Residential
|
130 units
|
55.4%
|
29,462
|
28,330
|
226,631
|
Q3 2015
|
Q1 2017
|
|||
$
|
121,163
|
$
|
113,568
|
(1)
|
Excludes tenant improvements and leasing commissions.
|
(2)
|
The Company is currently an approximately 52.9% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.
|
(3)
|
The Company is an approximately 86.1% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.
|
(4)
|
The Company is an approximately 58.6% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity. The anticipated total cost includes approximately 10,625 square feet of retail space.
|
(in thousands)
|
(in fiscal years)
|
|||||||
Project Name and Location
|
Planned Segment
|
Rentable
Square Feet
or Number of Units
|
Percentage
Leased
or Committed
|
Anticipated
Total Cost
|
Costs as of
January 31, 2015(1)
|
Anticipated Construction Completion
|
||
Roseville 3075 Long Lake Rd - Roseville, MN
|
Industrial
|
202,807 sq ft
|
5.4%
|
13,915
|
8,900
|
4Q 2015
|
||
Minot Office Center - Minot, ND
|
Retail
|
7,963 sq ft
|
0%
|
2,923
|
1,802
|
1Q 2016
|
||
Renaissance Heights - Williston, ND(2)
|
Multi-Family Residential
|
288 units
|
46.9%
|
62,362
|
54,713
|
1Q 2016
|
||
Chateau II - Minot, ND
|
Multi-Family Residential
|
72 units
|
0%
|
14,711
|
11,257
|
1Q 2016
|
||
Edina 6565 France SMC III - Edina, MN
|
Healthcare
|
57,479 sq ft
|
24.2%
|
34,665
|
16,668
|
1Q 2016
|
||
Cardinal Point - Grand Forks, ND
|
Multi-Family Residential
|
251 units
|
0%
|
40,042
|
19,885
|
2Q 2016
|
||
Deer Ridge – Jamestown, ND
|
Multi-Family Residential
|
163 units
|
4.9%
|
24,519
|
11,202
|
2Q 2016
|
||
PrairieCare Medical - Brooklyn Park, MN
|
Healthcare
|
72,895 sq ft
|
100%
|
24,251
|
12,195
|
2Q 2016
|
||
71 France Phases I & II- Edina, MN(3)
|
Multi-Family Residential
|
181 units
|
0%
|
52,055
|
20,787
|
3Q 2016
|
||
Other
|
n/a
|
n/a
|
n/a
|
n/a
|
2,547
|
n/a
|
||
$
|
269,443
|
$
|
159,956
|
(1)
|
Includes costs related to development projects that are placed in service in phases (Renaissance Heights - $46.0 million).
|
(2)
|
The Company is an approximately 70% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.
|
(3)
|
The project will be constructed in three phases by a joint venture entity in which the Company has an approximately 52.6% interest. The anticipated total cost amount given in the table above is the total cost to the joint venture entity of the project's first phase. The expected total project cost for all three phases is approximately $73.3 million for a total of approximately 241 residential units and approximately 21,772 square feet of retail space.
|
Three Months Ended January 31,
|
(in thousands, except per share amounts)
|
|||||||||
2015
|
2014
|
|||||||||
Amount
|
Weighted
Avg Shares
and Units(2)
|
Per
Share
And
Unit(3)
|
Amount
|
Weighted
Avg Shares
and Units(2)
|
Per
Share
And
Unit(3)
|
|||||
Net income attributable to Investors Real Estate Trust
|
$
|
8,371
|
$
|
3,503
|
||||||
Less dividends to preferred shareholders
|
(2,879)
|
(2,879)
|
||||||||
Net income available to common shareholders
|
5,492
|
120,855
|
$
|
0.05
|
624
|
106,208
|
$
|
0.00
|
||
Adjustments:
|
||||||||||
Noncontrolling interest – Operating Partnership
|
657
|
14,461
|
130
|
21,819
|
||||||
Depreciation and amortization(1)
|
17,706
|
17,546
|
||||||||
Impairment of real estate investments
|
540
|
4,798
|
||||||||
Gain on depreciable property sales
|
(951)
|
(358)
|
||||||||
Funds from operations applicable to common shares
and Units |
$
|
23,444
|
135,316
|
$
|
0.17
|
$
|
22,740
|
128,027
|
$
|
0.17
|
Nine Months Ended January 31,
|
(in thousands, except per share amounts)
|
|||||||||
2015
|
2014
|
|||||||||
Amount
|
Weighted
Avg Shares
and Units(2)
|
Per
Share
And
Unit(3)
|
Amount
|
Weighted
Avg Shares
and Units(2)
|
Per
Share
And
Unit(3)
|
|||||
Net income attributable to Investors Real Estate Trust
|
$
|
13,334
|
$
|
15,368
|
||||||
Less dividends to preferred shareholders
|
(8,636)
|
(8,636)
|
||||||||
Net income available to common shareholders
|
4,698
|
116,303
|
$
|
0.04
|
6,732
|
104,472
|
$
|
0.06
|
||
Adjustments:
|
||||||||||
Noncontrolling interest – Operating Partnership
|
618
|
17,334
|
1,406
|
21,830
|
||||||
Depreciation and amortization(4)
|
52,367
|
54,591
|
||||||||
Impairment of real estate investments
|
6,105
|
6,658
|
||||||||
Loss (gain) on depreciable property sales
|
811
|
(6,999)
|
||||||||
Funds from operations applicable to common shares
and Units |
$
|
64,599
|
133,637
|
$
|
0.48
|
$
|
62,388
|
126,302
|
$
|
0.49
|
(1) | Real estate depreciation and amortization consists of the sum of depreciation/amortization related to real estate investments and amortization related to non-real estate investments from the Condensed Consolidated Statements of Operations, totaling $17,750 and $17,489, and depreciation/amortization from Discontinued Operations of $0 and $77, less corporate-related depreciation and amortization on office equipment and other assets of $44 and $20, for the three months ended January 31, 2015 and 2014, respectively. |
(2) | UPREIT Units of the Operating Partnership are exchangeable for cash, or, at the Company's discretion, for common shares of beneficial interest on a one-for-one basis. |
(3) | Net income attributable to Investors Real Estate Trust is calculated on a per share basis. FFO is calculated on a per share and unit basis. |
(4) | Real estate depreciation and amortization consists of the sum of depreciation/amortization related to real estate investments and amortization related to non-real estate investments from the Condensed Consolidated Statements of Operations, totaling $52,474 and $53,656, and depreciation/amortization from Discontinued Operations of $0 and $1,010, less corporate-related depreciation and amortization on office equipment and other assets of $107 and $75 for the nine months ended January 31, 2015 and 2014, respectively. |
Month
|
Fiscal Year 2015
|
Fiscal Year 2014
|
||
July
|
$
|
.1300
|
$
|
.1300
|
October
|
$
|
.1300
|
$
|
.1300
|
January
|
$
|
.1300
|
$
|
.1300
|
(in thousands)
|
|||||||||||||||||||||||
Future Principal Payments
|
|||||||||||||||||||||||
Mortgages
|
Remaining
Fiscal 2015
|
Fiscal 2016
|
Fiscal 2017
|
Fiscal 2018
|
Fiscal 2019
|
Thereafter
|
Total
|
Fair Value
|
|||||||||||||||
Fixed Rate
|
$
|
21,997
|
$
|
120,806
|
$
|
187,010
|
$
|
56,118
|
$
|
128,391
|
$
|
413,402
|
$
|
927,724
|
$
|
1,139,370
|
|||||||
Average Fixed Interest Rate(1)
|
5.31%
|
5.14%
|
4.79%
|
5.14%
|
4.76%
|
||||||||||||||||||
Variable Rate
|
$
|
393
|
$
|
9,397
|
$
|
16,500
|
$
|
31,921
|
$
|
6,112
|
$
|
14,132
|
$
|
78,455
|
$
|
78,455
|
|||||||
Average Variable Interest Rate(1)
|
2.93%
|
2.84%
|
2.86%
|
2.93%
|
2.97%
|
||||||||||||||||||
$
|
1,006,179
|
$
|
1,217,825
|
(in thousands)
|
|||||||||||||||||||||
Future Interest Payments
|
|||||||||||||||||||||
Mortgages
|
Remaining
Fiscal 2015
|
Fiscal 2016
|
Fiscal 2017
|
Fiscal 2018
|
Fiscal 2019
|
Thereafter
|
Total
|
||||||||||||||
Fixed Rate
|
$
|
12,326
|
$
|
46,520
|
$
|
37,586
|
$
|
30,734
|
$
|
25,771
|
$
|
50,067
|
$
|
203,004
|
|||||||
Variable Rate
|
575
|
2,062
|
1,947
|
957
|
588
|
189
|
6,318
|
||||||||||||||
$
|
209,322
|
(1)
|
Interest rate given is for the entire year.
|
Exhibit No.
|
Description
|
Calculation of Ratio of Earnings to Fixed Charges and Earnings to Combined Fixed Charges and Preferred Share Distributions
|
|
Certification by Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification by Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101
|
The following materials from our Quarterly Report on Form 10-Q for the quarter ended January 31, 2015 formatted in eXtensible Business Reporting Language ("XBRL"): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Statements of Equity, (iv) the Condensed Consolidated Statements of Cash Flows, and (v) notes to these condensed consolidated financial statements.
|
/s/ Timothy P. Mihalick
|
|
Timothy P. Mihalick
|
|
President and Chief Executive Officer
|
|
/s/ Ted E. Holmes
|
|
Ted E. Holmes
|
|
Executive Vice President and Chief Financial Officer
|
|
Date: March 12, 2015
|
Exhibit No.
|
Description
|
Calculation of Ratio of Earnings to Fixed Charges and Earnings to Combined Fixed Charges and Preferred Share Distributions
|
|
Certification by Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification by Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101
|
The following materials from our Quarterly Report on Form 10-Q for the quarter ended January 31, 2015 formatted in eXtensible Business Reporting Language ("XBRL"): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Statements of Equity, (iv) the Condensed Consolidated Statements of Cash Flows, and (v) notes to these condensed consolidated financial statements.
|
Nine Months
Ended
|
Fiscal Year Ended
April 30,
|
||||||||||||
January 31, 2015
|
2014
|
2013
|
2012
|
2011
|
2010
|
||||||||
Earnings
|
|||||||||||||
Income (loss) from continuing operations
|
$
|
14,822
|
$
|
(23,390)
|
$
|
20,677
|
$
|
8,644
|
$
|
4,679
|
$
|
5,710
|
|
Add:
|
|||||||||||||
Combined fixed charges and preferred distributions (see below)
|
56,122
|
73,933
|
73,657
|
68,172
|
64,954
|
71,497
|
|||||||
Amortization of capitalized interest
|
50
|
0
|
0
|
0
|
0
|
0
|
|||||||
Less:
|
|||||||||||||
(Income) loss noncontrolling interests – consolidated real estate entities
|
(870)
|
(910)
|
(809)
|
(135)
|
180
|
(22)
|
|||||||
Interest capitalized
|
(3,628)
|
(2,856)
|
(742)
|
(571)
|
(57)
|
(19)
|
|||||||
Preferred distributions
|
(8,636)
|
(11,514)
|
(9,229)
|
(2,372)
|
(2,372)
|
(2,372)
|
|||||||
Total earnings
|
$
|
57,860
|
$
|
35,263
|
$
|
83,554
|
$
|
73,738
|
$
|
67,384
|
$
|
74,794
|
|
Fixed charges
|
|||||||||||||
Interest expensed
|
$
|
43,858
|
$
|
59,563
|
63,686
|
65,229
|
62,525
|
69,106
|
|||||
Interest capitalized
|
3,628
|
2,856
|
742
|
571
|
57
|
19
|
|||||||
Total fixed charges
|
$
|
47,486
|
$
|
62,419
|
$
|
64,428
|
$
|
65,800
|
$
|
62,582
|
$
|
69,125
|
|
Preferred distributions
|
8,636
|
11,514
|
9,229
|
2,372
|
2,372
|
2,372
|
|||||||
Total combined fixed charges and preferred distributions
|
$
|
56,122
|
$
|
73,933
|
$
|
73,657
|
$
|
68,172
|
$
|
64,954
|
$
|
71,497
|
|
Ratio of earnings to fixed charges
|
1.22x
|
(1)
|
1.30x
|
1.12x
|
1.08x
|
1.08x
|
|||||||
Ratio of earnings to combined fixed charges and preferred distributions
|
1.03x
|
(1)
|
1.13x
|
1.08x
|
1.04x
|
1.05x
|
(1)
|
Due to non-cash asset impairment charges of $42.6 million, earnings were inadequate to cover fixed charges and combined fixed charges and preferred distributions by $27.2 million and $38.7 million, respectively. Excluding the asset impairment charge, the ratios of earnings to fixed charges and earnings to combined fixed charges and preferred distributions would have been 1.25 and 1.05, respectively, for the fiscal year ended April 30, 2014.
|
1. | I have reviewed this quarterly report on Form 10-Q of Investors Real Estate Trust; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
By:
|
/s/ Timothy, P. Mihalick
|
|
Timothy, P. Mihalick, President & CEO
|
1. | I have reviewed this quarterly report on Form 10-Q of Investors Real Estate Trust; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
By:
|
/s/ Ted E. Holmes
|
|
Ted E. Holmes, Executive Vice President & CFO
|
/s/ Timothy P. Mihalick
|
|
Timothy P. Mihalick
|
|
President and Chief Executive Officer
|
|
Date: March 12, 2015
|
|
/s/ Ted E. Holmes
|
|
Ted E. Holmes
|
|
Executive Vice President and Chief Financial Officer
|
|
Date: March 12, 2015
|
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