-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, G92tkYG8geBjoFBY/sEcM/gClU37fYTe7ZwkJUPCesulLdGq3zaDcNLgOsvt4mXS RSksMW8Es2v5TM41nexOpg== 0000928385-01-501384.txt : 20010806 0000928385-01-501384.hdr.sgml : 20010806 ACCESSION NUMBER: 0000928385-01-501384 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20010803 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: FILED AS OF DATE: 20010803 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CARRAMERICA REALTY CORP CENTRAL INDEX KEY: 0000893577 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 521796339 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11706 FILM NUMBER: 1697089 BUSINESS ADDRESS: STREET 1: 1850 K STREET NW STREET 2: SUITE 500 CITY: WASHINGTON STATE: DC ZIP: 20006 BUSINESS PHONE: 2027297500 MAIL ADDRESS: STREET 1: 1700 PENNSYLVANIA AVENUE STREET 2: SUITE 700 CITY: WASHINGTON STATE: DC ZIP: 20006 FORMER COMPANY: FORMER CONFORMED NAME: CARR REALTY CORP DATE OF NAME CHANGE: 19940218 8-K 1 d8k.txt FORM 8-K =============================================================================== SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20543 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (date of earliest event reported) August 3, 2001 Commission File No. 1-11706 CARRAMERICA REALTY CORPORATION ------------------------------------------------------ (Exact name of registrant as specified in its charter) Maryland 52-1796339 - --------------------------------------------- --------------------------------------- (State or other jurisdiction of incorporation (I.R.S. Employer Identification Number) or organization)
1850 K Street, N.W., Washington, D.C. 20006 -------------------------------------------------- (Address or principal executive office) (Zip code) Registrant's telephone number, including area code: (202) 729-1000 ------------- =============================================================================== CarrAmerica Realty Corporation Form 8-K Item 7 Financial Statements and Exhibits (c) Exhibits Exhibits Number ------------ 99.1 Press Release, August 3, 2001 entitled "Supplemental Operating and Financial Data". 99.2 Press Release, August 3, 2001. Item 9 Regulation FD Disclosure Attached hereto as Exhibits 99.1 and 99.2 are copies of certain Supplemental Information included in the Company's press release, dated August 3, 2001 and the Company's Press Release, dated August 3, 2001. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: August 3, 2001 CARRAMERICA REALTY CORPORATION By: /s/ Stephen E. Riffee ---------------------- Stephen E. Riffee Principal Accounting Officer 3 EXHIBIT INDEX Exhibit Number - ------- 99.1 Press Release, August 3, 2001 entitled "Supplemental Information" 99.2 Press Release, August 3, 2001 4 EX-99.1 3 dex991.txt EXHIBIT 99.1 CarrAmerica(R) America's Workplace(R) [PICTURES APPEAR HERE] Supplemental Operating and Financial Data For the Quarter Ended June 30, 2001 All dollar amounts shown in this report are in U.S. dollars. This supplemental Operating and Financial Data is not an offer to sell or solicitation to buy any securities of the Company. Any offers to sell or solicitations to buy any securities of the Company shall be made by means of a prospectus. TABLE OF CONTENTS
PAGE ---- CORPORATE OVERVIEW The Company.................................................................... 1 Board of Directors / Executive Officers / Research Coverage.................... 2 Regional Offices / Investor Relations / Information Requests................... 3 FINANCIAL HIGHLIGHTS Key Quarterly Financial Data.................................................. 4 Consolidated Balance Sheets................................................... 5 Statements of Operations...................................................... 6 Statements of Cash Flow....................................................... 7 FFO Statement................................................................. 8 Same Store Results and Analysis............................................... 9 Statements of EBITDA.......................................................... 10 Financial Ratios ............................................................. 11 Share and Operating Partnership Unit Data .................................... 12 Debt Capitalization Summary .................................................. 13-14 Corporate Investment Balances ................................................ 15 SEGMENT ANALYSIS Core Operating Properties ------------------------- Current Summary of Operating Properties....................................... 16-19 Occupancy Summary and Lease Roll-over Schedule................................ 20 Operating Portfolio Lease Economics........................................... 21 Top 25 Tenants by Rent ....................................................... 22 Development ----------- Development Activity by Market ............................................... 23 Land Held for Development Schedule............................................ 24
THE COMPANY - ----------- CarrAmerica Realty Corporation (the "Company") is a self-administered and self- managed equity real estate investment trust ("REIT"), organized under the laws of Maryland, which owns, develops, acquires and operates office properties. The Company's office properties are located primarily in 12 suburban markets across the United States. CURRENT PORTFOLIO - ----------------- (consolidated, stabilized; as of 6/30/01) 253 Properties 20.1 Million Square Feet (consolidated/unconsolidated; as of 6/30/01) 287 Properties 24.3 Million Square Feet CARRAMERICA MISSION STATEMENT - ----------------------------- Our primary goal is to excel in meeting the needs of our customers by providing built environments of the highest quality and services that continue to set new standards of excellence. The core values that infuse our efforts are quality, integrity, a sense of community and a genuine commitment to people. UNSECURED SENIOR DEBT RATINGS - ----------------------------- Duff & Phelps: BBB Moody's: Baa2 Standard & Poor's: BBB YEAR-TO-DATE AVERAGE OCCUPANCY - ------------------------------ (stabilized) 97.1% Consolidated Properties 97.0% All Properties REGIONAL DISTRIBUTION - --------------------- (stabilized; as of 6/30/01) Based on Based on Square NOI Footage -------- --------------- Pacific region 52.16% 50.12% Eastern region 25.74% 23.39% Central region 14.15% 16.28% Mountain region 7.95% 10.21% TOP 5 MARKETS - ------------- (stabilized; as of 6/30/01) % of NOI % of Sq. Ft. ---------- ------------ San Francisco Bay Area 31.71 26.93 Washington DC Metro 19.62 14.58 Dallas 7.57 8.02 Orange County/Los Angeles 6.79 9.03 Seattle 6.65 7.47 ----- ----- 72.34 66.03 ===== ===== BOARD OF DIRECTORS RESEARCH COVERAGE - ------------------ ----------------- Thomas A. Carr Chairman of the Board, President Lee Schalop/Alexis Hughes and Chief Executive Officer Bank of America Securities CarrAmerica Realty Corporation (212) 847-5677/(212) 847-5705 Ronald Blankenship Louis Taylor Vice Chairman and Chief Operating Officer Deutsche Banc Alex. Brown Security Capital Group Incorporated (212) 469-4912 Andrew F. Brimmer Christopher Haley/Donald Fandetti President First Union Brimmer & Company Inc. (443)263-6773/(443) 263-6537 Oliver T. Carr, Jr. James Kammert Chairman of the Board Goldman, Sachs & Company The Oliver Carr Company (212) 855-0670 A. James Clark John Lutzius/Elizabeth Morse Chairman of the Board and President Green Street Advisors Clark Enterprises, Inc. (949) 640-8780 Timothy Howard David Fick/Ken Weinberg Executive Vice President and Legg Mason Wood Walker Chief Financial Officer (410) 454-5018/(410) 454-5175 Fannie Mae David Harris Caroline S. McBride Lehman Brothers Managing Director (212) 526-5702 Security Capital Global Strategic Group, Inc. Steve Sakwa/Brian Legg William D. Sanders Merrill Lynch & Company, Inc. Chairman (212) 449-0335/(212) 449-1153 Security Capital Group Incorporated Greg Whyte Wesley S. Williams, Jr. Morgan Stanley Dean Witter Partner (212) 761-6331 Covington & Burling Jim Sullivan/Mike Marron Prudential Securities EXECUTIVE OFFICERS (212) 778-2515/(212) 778-1774 - ------------------ Jonathan Litt/Gary Boston Thomas A. Carr Salomon Smith Barney President & Chief Executive Officer (212) 816-0231/(212) 816-1383 Philip L. Hawkins Chief Operating Officer Richard F. Katchuk Chief Financial Officer Karen B. Dorigan Chief Investment Officer
2 CORPORATE HEADQUARTERS CONTACT - ---------------------- ------- 1850 K Street, N.W. Suite 500 Stephen M. Walsh Washington, D.C. 20006 Vice President, Capital Markets (202) 729-1000 Telephone: (202) 729-1764 E-mail: swalsh@carramerica.com REGIONAL OFFICES ---------------------- - ---------------- INFORMATION REQUEST Atlanta, Georgia ------------------- J. Thad Ellis, Regional Managing Director To request a standard Investor Relations Austin, Texas package, Annual Report, or to be added to our Jeffrey S. Pace, Regional Managing Director mailing or fax list, please contact or address an e-mail to: Chicago, Illinois Gerald J. O'Malley, Regional Managing Director Investor Relations at (202) 729-7518 Or 1 (800) 417-2277 Dallas, Texas swalsh@carramerica.com William Vanderstraaten, Regional Managing Director CARRAMERICA(R) Denver, Colorado PLEASE VISIT OUR CORPORATE WEB SITE William Krokowski, Regional Managing Director ----------------------------------- AT: Northern California --- Leah N. Segawa, Regional Managing Director www.carramerica.com ------------------- Phoenix, Arizona Robert Milkovich, Regional Managing Director Salt Lake City William Krokowski, Regional Managing Director Seattle/Portland Clete Casper, Regional Managing Director Southern California Malcolm O'Donnell, Regional Managing Director Washington, D.C. John Donovan, Regional Managing Director STOCK EXCHANGE LISTINGS - ----------------------- New York Stock Exchange TRADING SYMBOL - -------------- CRE INVESTOR RELATIONS - ------------------ CarrAmerica Realty Corporation 1850 K Street, N.W. Washington, D.C. 20006 Telephone: (202) 729-1000 Fax: (202) 729-1060
3 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Key Quarterly Financial Data - --------------------------------------------------------------------------------
($ and shares in thousands) 6/30/01 3/31/01 12/31/00 9/30/00 6/30/00 --------------------------------------------------------------------- Shares and Units: - ----------------- Common Shares 62,082 62,080 65,018 65,759 66,307 Outstanding OP Units (a) 5,797 6,065 6,088 6,480 6,364 Convertible Preferred Shares 80 480 480 480 480 Combined Shares and OP Units (a) 67,959 68,625 71,586 72,719 73,151 Weighted Average - Basic 61,840 63,186 65,152 65,987 66,856 Weighted Average - Diluted 69,494 70,678 73,432 74,767 74,684 Share Price: - ------------ At the End of the Period $ 30.50 $ 28.53 $ 31.31 $ 30.25 $ 26.52 High During Period 30.69 30.88 31.50 30.75 28.31 Low During Period 27.00 27.83 28.80 27.44 21.38 Capitalization Summary (continuing operations): - ----------------------------------------------- Market Value of Common Equity $2,072,750 $1,957,871 $2,241,537 $2,199,750 $1,939,965 Preferred Equity 400,000 400,000 400,000 400,000 400,000 Total Debt 1,109,778 1,253,095 1,211,158 1,215,710 1,432,972 Total Market Capitalization 3,582,528 3,610,966 3,852,695 3,815,460 3,772,937 Total Debt/Total Market Capitalization 31.0% 34.7% 31.4% 31.9% 38.0% Financial Information (continuing operations): - --------------------------------------------- Total Assets $2,821,172 $2,988,347 $3,072,841 $3,112,140 $3,318,363 Book Value of Real Estate Assets (before accumulated depreciation) 2,889,703 2,852,199 2,909,604 3,015,812 3,313,038 Total Liabilities 1,204,448 1,352,662 1,336,448 1,346,789 1,540,890 Total Minority Interest (including OP) 85,993 88,042 89,687 90,455 89,389 Total Shareholders' Equity 1,530,731 1,547,643 1,646,706 1,674,896 1,688,084 Total Operating Revenues 133,526 133,926 132,669 139,357 144,439 Property NOI 85,340 82,181 82,942 91,912 94,625 Property Operating Margin 68.9% 66.4% 66.7% 69.8% 68.0% EBITDA 87,801 82,375 83,765 90,094 90,076 EBITDA Per Share - Basic 1.42 1.30 1.29 1.37 1.35 EBITDA Per Share - Diluted 1.26 1.17 1.14 1.20 1.21 Interest Coverage Ratio (c) 4.2 4.0 3.9 3.6 3.6 Interest Coverage Ratio (d) 3.8 3.6 3.5 3.3 3.1 Fixed Charge Coverage Ratio (c) 2.6 2.5 2.4 2.5 2.4 Fixed Charge Coverage Ratio (d) 2.4 2.4 2.3 2.3 2.2 Adjusted Funds From Operations (b, e) 58,665 54,637 55,138 56,348 55,430 Dividends Declared 0.4625 0.4625 0.4625 0.4625 0.4625 FFO Payout Ratio - Diluted (b) 55.1% 60.1% 61.7% 61.7% 62.5% Net-Straight Line Revenue/Expense Adjustment 2,897 2,366 3,844 3,168 3,465 Portfolio Size (including unconsolidated properties): - ----------------------------------------------------- Buildings 287 283 283 284 281 Total Square Footage 24,272 23,597 23,914 24,569 24,331 Current Weighted Average Occupancy 97.2% 97.0% 97.7% 97.5% 98.4% (a) Operating partnership (b) See page 8 for definitions of Funds from Operations (FFO) (c) Excluding covering capitalized interest (d) Including covering capitalized interest (e) Represents diluted Funds from Operations (FFO)
4 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets - --------------------------------------------------------------------------------
(In thousands) June 30, December 31, 2001 2000 -------- ------------ (unaudited) Assets - ------ Rental property Land $ 644,799 $ 644,326 Buildings 1,825,629 1,836,214 Tenant improvements 338,606 325,936 Furniture, fixtures and equipment 3,521 6,844 ----------- ----------- 2,812,555 2,813,320 Less: Accumulated depreciation (422,617) (381,260) ----------- ----------- Net rental property 2,389,938 2,432,060 Land held for future development or sale 44,599 47,984 Construction in progress 32,549 48,300 Cash and cash equivalents 14,482 24,704 Restricted deposits 7,288 39,482 Accounts and notes receivable 32,374 70,693 Investments in unconsolidated entities 153,468 269,193 Accrued straight-line rents 59,189 54,960 Tenant leasing costs, net 52,030 54,522 Deferred financing costs, net 9,760 11,311 Prepaid expenses and other assets, net 25,495 19,632 ----------- ----------- $ 2,821,172 $ 3,072,841 =========== =========== Liabilities and Stockholders' Equity - ------------------------------------ Liabilities: Mortgages and notes payable $ 1,109,778 $ 1,211,158 Accounts payable and accrued expenses 64,778 96,147 Rent received in advance and security deposits 29,892 29,143 ----------- ----------- 1,204,448 1,336,448 Minority interest 85,993 89,687 Stockholders' equity: Preferred stock 89 93 Common stock 621 650 Additional paid in capital 1,653,396 1,755,985 Cumulative dividends in excess of net income (123,375) (110,022) ----------- ----------- 1,530,731 1,646,706 ----------- ----------- Commitments and contingencies $ 2,821,172 $ 3,072,841 =========== ===========
5 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations - -------------------------------------------------------------------------------- (In thousands, except per share amounts)
Three Months Ended Six Months Ended June 30, June 30, ------------------------------------------ ------------------------------------- 2001 2000 2001 2000 ------------------- ------------------- ------------------- -------------- (unaudited) (unaudited) Revenues: Rental income (1): Minimum base rent $105,802 $115,303 $212,012 $229,183 Recoveries from tenants 14,683 17,505 28,724 34,339 Parking and other tenant charges 3,338 6,319 6,876 12,230 -------- -------- -------- -------- Total rental revenue 123,823 139,127 247,612 275,752 Real estate service income 9,703 5,312 19,840 10,253 -------- -------- -------- -------- Total operating revenues 133,526 144,439 267,452 286,005 -------- -------- -------- -------- Operating expenses: Property expenses: Operating expenses 28,433 31,930 60,474 64,212 Real estate taxes 10,050 12,572 19,617 24,518 Interest expense 21,136 25,115 41,996 52,005 General and administrative 11,939 12,001 26,340 21,773 Depreciation and amortization 30,820 35,170 61,645 67,319 -------- -------- -------- -------- Total operating expenses 102,378 116,788 210,072 229,827 -------- -------- -------- -------- Real estate operating income 31,148 27,651 57,380 56,178 Other income: Interest income 1,023 873 2,127 1,750 Equity in earnings of unconsolidated entities 3,674 1,267 7,028 2,716 -------- -------- -------- -------- Total other income 4,697 2,140 9,155 4,466 -------- -------- -------- -------- Income from continuing operations before income taxes, minority interest and (loss) gain on sale of assets and other provisions, net 35,845 29,791 66,535 60,644 Income taxes (187) - (234) - Minority interest (3,076) (2,353) (4,529) (5,408) (Loss) gain on sale of assets and other provisions, net (22) 2,387 1,054 7,741 -------- -------- -------- -------- Income from continuing operations 32,560 29,825 62,826 62,977 Discontinued operations - Income from operations of discontinued Executive Suites subsidiary (less applicable income tax expense) - 1,836 - 456 Discontinued operations - Gain on sale of discontinued operations (less applicable income tax expense of $21,131) - 31,852 - 31,852 -------- -------- -------- -------- Net income $ 32,560 $ 63,513 $ 62,826 $ 95,285 ======== ======== ======== ======== Basic net income per share: Net income from continuing operations $ 0.39 $ 0.31 $ 0.73 $ 0.68 Discontinued operations - 0.03 - - Gain on discontinued operations - 0.48 - 0.48 -------- -------- -------- -------- Net income $ 0.39 $ 0.82 $ 0.73 $ 1.16 ======== ======== ======== ======== Diluted net income per share: Net income from continuing operations $ 0.38 $ 0.31 $ 0.71 $ 0.68 Discontinued operations - 0.03 - - Gain on discontinued operations - 0.43 - 0.44 -------- -------- -------- -------- Net income $ 0.38 $ 0.77 $ 0.71 $ 1.12 ======== ======== ======== ========
NOTE: (1) Rental income includes $2,897 and $3,465 of accrued straight line rents for the three months periods ended June 30, 2001 and 2000, respectively, and $5,263 and $6,466 of accrued straight line rents for the six months period ended June 30, 2001 and 2000, respectively. 6 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flow - -------------------------------------------------------------------------------- (Unaudited and in thousands)
Six Months Ended June 30, ----------------------------- 2001 2000 Cash flow from operating activities: Net income $ 62,826 $ 95,285 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 61,645 67,370 Minority interest 4,529 5,408 Equity in earnings of unconsolidated entities (7,028) (2,716) Gain on sale of assets and other provisions, net (1,054) (7,741) Income and gain on sale of discontinued operations - (32,308) Provision for uncollectible accounts 4,703 1,549 Stock based compensation 1,469 1,553 Other 264 (1,140) Change in assets and liabilities: Decrease (increase) in accounts and notes receivable 16,140 (5,689) Increase in accrued straight-line rents (5,417) (6,466) Additions to tenant leasing costs (5,519) (9,059) Increase in prepaid expenses and other assets (7,866) (9,876) Decrease in accounts payable and accrued expenses (32,221) (5,080) Increase in rent received in advance and security deposits 1,279 3,095 --------- --------- Total adjustments 30,924 (1,100) --------- --------- Net cash provided by operating activities 93,750 94,185 --------- --------- Cash flows from investing activities: Acquisition and development of rental property (16,207) (46,825) Additions to land held for development or sale (34,840) (11,071) Additions to construction in progress (19,215) (33,493) Acquisitions and development of executive suites assets - (6,678) Payments on notes receivable 16,539 139 Distributions from unconsolidated entities 89,616 3,568 Investments in unconsolidated entities (10,440) (9,875) Acquisition of minority interest (3,289) (1,478) Decrease (increase) in restricted cash and cash equivalents 32,194 (322) Proceeds from the sale of discontinued operations - 377,310 Proceeds from sales of properties 100,474 62,883 --------- --------- Net cash provided by investing activities 154,832 334,158 --------- --------- Cash flows from financing activities: Repurchase of common stock (119,210) (28,450) Exercises of stock options 16,082 9,945 Net repayments on unsecured credit facility (86,000) (317,500) Net repayments of mortgages payable (15,502) (7,849) Proceeds from mortgages 26,628 - Dividends and distributions to minority interests (80,802) (85,524) Contributions from minority interests - 1,948 --------- --------- Net cash used by financing activities (258,804) (427,430) --------- --------- (Decrease) increase in unrestricted cash and cash equivalents (10,222) 913 Unrestricted cash and cash equivalents, beginning of the period 24,704 51,886 --------- --------- Unrestricted cash and cash equivalents, end of the period $ 14,482 $ 52,799 ========= ========= Supplemental disclosure of cash flow information: Cash paid for interest (net of capitalized interest of $3,837 and $16,378 for the six months ended June 30, 2001 and 2000, respectively) $ 49,207 $ 60,106 ========= =========
7 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Funds From Operations - -------------------------------------------------------------------------------- The National Association of Real Estate Investment Trusts (NAREIT) defines funds from operations ("FFO") as net income (loss) (computed in accordance with generally accepted accounting principles), excluding gains (or losses) from debt restructuring or sales of property, plus depreciation and amortization of assets uniquely significant to the real estate industry and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. NAREIT's definition for FFO excludes discontinued operations, however, the Company has elected to calculate FFO from discontinued operations, the Company's executive suites business which was sold in 2000. FFO for discontinued operations includes executive suites earnings before depreciation, amortization and deferred taxes ("EBDADT").
(In thousands, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, ----------------------------------------------- 2001 2000 2001 2000 ----------------------------------------------- Net income from continuing operations before minority interest: $ 35,636 $ 32,178 $ 67,355 $ 68,385 Adjustments to derive funds from continuing operations: Add: Depreciation and amortization - REIT properties 29,540 33,351 59,162 64,134 Depreciation and amortization - Equity properties 2,211 1,030 5,295 1,689 Deduct: Minority interests' (non Unitholders) share of depreciation, amortization and net income (219) (218) (501) (473) Loss (gain) on sale of assets and other provisions, net 22 (2,387) (1,054) (7,741) -------- -------- -------- -------- FFO from continuing operations before allocations to minority Unitholders 67,190 63,954 130,257 125,994 Less: FFO allocable to the minority Unitholders (4,507) (3,794) (8,344) (8,231) -------- -------- -------- -------- CarrAmerica Realty Corporation's FFO from continuing operations 62,683 60,160 121,913 117,763 Less: Preferred stock dividends (8,746) (8,745) (17,395) (17,522) -------- -------- -------- -------- CarrAmerica Realty Corporation's FFO from continuing operations attributable to common shares 53,937 51,415 104,518 100,241 Discontinued operations - 8,473 - 13,368 Gain on sale of discontinued operations - 31,852 - 31,852 -------- -------- -------- -------- CarrAmerica Realty Corporation's FFO attributable to common shares $ 53,937 $ 91,740 $104,518 $145,461 ======== ======== ======== ======== Weighted average common shares outstanding: Basic 61,840 66,856 62,509 66,912 Diluted 69,494 74,684 70,353 74,292 Basic funds from operations per common share: Funds from continuing operations $ 0.87 $ 0.77 $ 1.67 $ 1.50 Funds from discontinued operations - 0.13 - 0.20 Funds from sale of discontinued operations - 0.48 - 0.48 -------- -------- -------- -------- Total funds from operations $ 0.87 $ 1.38 $ 1.67 $ 2.18 ======== ======== ======== ======== Diluted funds from operations per common share: Funds from continuing operations $ 0.84 $ 0.74 $ 1.61 $ 1.47 Funds from discontinuing operations - 0.11 - 0.18 Funds from sale of discontinued operations - 0.43 - 0.43 -------- -------- -------- -------- Total funds from operations $ 0.84 $ 1.28 $ 1.61 $ 2.08 -------- -------- -------- -------- CarrAmerica Realty Corporation FFO attributed to common share from continuing operations $ 53,937 $ 51,415 $104,518 $100,241 Series A Preferred share dividends 221 221 440 474 Minority interest from convertible partnership units 4,507 3,794 8,344 8,232 -------- -------- -------- -------- Adjusted FFO attributable to common shares from continuing operations $ 58,665 $ 55,430 $113,302 $108,947 ======== ======== ======== ======== Weighted average common shares outstanding - Basic 61,840 66,856 62,509 66,912 Weighted average conversion of Series A Preferred shares 392 480 436 510 Weighted average conversion of operating partnership units 6,062 6,470 6,068 6,475 Incremental options 1,200 878 1,340 395 -------- -------- -------- -------- Adjusted weighted average common shares - Diluted 69,494 74,684 70,353 74,292 ======== ======== ======== ========
8 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Same Store Operating Property Results - -------------------------------------------------------------------------------- (In thousands)
Three Months Ended % Six Months Ended % June 30, Change June 30, Change --------------------------- -------- ------------------------ -------- 2001 2000 2001 2000 ----------- ------------ ----------- ---------- Real estate operating revenue $ 109,756 $105,532 4.0% $ 211,380 $203,218 4.0% Real estate operating expenses 33,330 31,834 4.7% 65,452 61,090 7.1% ----------- -------- ----------- -------- Total real estate operating income - GAAP basis $ 76,426 $ 73,698 3.7% $ 145,928 $142,128 2.7% =========== ======== =========== ======== Straight-line rent adjustment 1,871 2,065 -9.4% 3,343 3,832 -12.8% ----------- -------- ----------- -------- Total real estate operating income - Cash basis $ 74,555 $ 71,633 4.1% $ 142,585 $138,296 3.1% =========== ======== =========== ======== YTD average occupancy 96.8% 97.8% -1.0% 96.7% 97.9% -1.2% =========== ======== =========== ======== Same store square footage 17,661,817 17,118,839 =========== ===========
9 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Statements of EBITDA - -------------------------------------------------------------------------------- (In thousands)
Three Months Ended Six Months Ended June 30, June 30, ---------------------- ------------------------ 2001 2000 2001 2000 ------- ---------- --------- -------- CONTINUING OPERATIONS: Revenues: Rental income $123,823 $139,127 $ 247,612 $ 275,752 Real estate service income 9,703 5,312 19,840 10,253 Other income (1) 4,697 2,140 9,155 4,466 -------- -------- --------- --------- Total revenue 138,223 146,579 276,607 290,471 -------- -------- --------- --------- Operating expenses: Property operating expenses: Operating expenses 28,433 31,930 60,474 64,212 Real estate taxes 10,050 12,572 19,617 24,518 General and administrative 11,939 12,001 26,340 21,773 -------- -------- --------- --------- Total operating expenses 50,422 56,503 106,431 110,503 -------- -------- --------- --------- EBITDA from continuing operations $ 87,801 $ 90,076 $ 170,176 $ 179,968 ======== ======== ========= ========= (1) Excludes (loss) gain on sale of assets and other provisions, net
10 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Financial Ratios - --------------------------------------------------------------------------------
Financial Position Ratios for Continuing Operations: - ---------------------------------------------------- June 30, December 31, 2001 2000 ------------------------- Total Debt/Total Capitalization (Book Value) 40.3% 42.4% Total Debt/Total Capitalization (Market) 31.0% 31.4% Operating Ratios for Continuing Operations: - ------------------------------------------- Three Months Ended Six Months Ended June 30, June 30, ----------------------------------------------- 2001 2000 2001 2000 --------------------------------------------- Secured EBITDA/Total EBITDA 32.2% 33.8% 31.7% 34.6% Interest Coverage (1) Excluding covering capitalized interest 4.15 3.59 4.05 3.46 Covering capitalized interest 3.79 3.15 3.71 3.04 Fixed charge coverage Excluding covering capitalized interest 2.56 2.37 2.52 2.34 Covering capitalized interest 2.41 2.17 2.38 2.14 Diluted FFO Payout Ratio (2) 55.1% 62.5% 57.5% 62.9% G&A as a % of Revenue (3) 8.6% 8.3% 9.5% 7.6%
NOTES: (1) Calculated as EBITDA before minority interests allocation, extraordinary items, and nonrecurring charges divided by interest expense for the period. (2) Dividends paid per common share divided by diluted FFO per share. (3) Excludes gains on sales of assets. Includes interest income and equity on earnings of unconsolidated entities. 11 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Share and Operating Partnership Unit Data - -------------------------------------------------------------------------------- The following table sets forth the Common and Series A Preferred shares of the Company and dividend and non-dividend paying operating partnership Units outstanding at June 30, 2001 and December 31, 2000, and the weighted average Common and Series A Preferred shares of the Company and dividend and non- dividend paying operating partnership Units outstanding for the quarter ended June 30, 2001 and 2000. The non-dividend paying Units are not entitled to any distributions until they convert into dividend paying Units on fixed dates in the future.
(In thousands) CarrAmerica Realty Corporation CarrAmerica Series A Realty Corporation Convertible Dividend Paying Non-Dividend Common Shares Preferred Shares Units Paying Units Outstanding Outstanding (a) Outstanding (b) Outstanding ------------------------- ----------------------- ----------------- ----------------- Outstanding as of June 30, 2001 62,082 80 5,794 268 December 31, 2000 65,018 480 5,820 432 Weighted average for the three months ended June 30, 2001 61,840 392 5,794 268 2000 66,856 480 6,038 432 Weighted average for the six months ended June 30, 2001 62,509 436 5,800 268 2000 66,912 510 6,043 432
Notes: (a) Series A Preferred shares are convertible into common shares on a one-for- one basis. (b) Operating partnership Units are convertible into cash or common shares on a one-for-one basis. (c) The Company has the following Cumulative Redeemable Preferred shares outstanding which are not included in the table above: Series B 8,000,000 Shares Series C 6,000,000 Shares Series D 2,000,000 Shares 12 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Debt Capitalization Summary - --------------------------------------------------------------------------------
($ in thousands) Principal Interest Maturity Description of Notes/Lender Property Outstanding Rate Date - --------------------------- --------------------------------- ----------- -------- --------- General Electric Capital Corp. Bannockburn $ 17,055 9.52% 31-Aug-01 Techmart Commercial Ctr. Techmart Commercial Ctr. (Note 5) 124 N/A N/A Manufacturers Life Quorum North 6,301 8.27% 10-Dec-01 NY Life NELO (Note 2) 38,533 8.25% 10-Dec-01 NML Square 24 Associates (Note 4) 31,493 8.90% 01-Jun-02 Union Bank of California Jaycor 11,213 7.35% 01-Feb-03 GE Capital Parkway North 24,164 6.92% 01-Dec-03 Sun Life Assurance Company of Canada Tract 17/Canyon Park Commons 5,052 9.13% 01-Dec-04 UBS Mortgage Finance Inc. U.S. West 18,270 7.92% 01-Dec-05 UBS Mortgage Finance Inc. U.S. West 5,246 7.92% 01-Dec-05 UBS Mortgage Finance Inc. U.S. West 7,870 7.92% 01-Dec-05 UBS Mortgage Finance Inc. U.S. West 7,870 7.92% 01-Dec-05 Salomon Brothers Redmond East 26,365 8.38% 01-Jan-06 State Farm Peterson (Note 3) 19,095 7.20% 01-Jan-06 Farm Bureau Life Insurance Co. Wateridge Pavilion 3,337 8.25% 01-Nov-06 Teachers Ins. and Ann. Assoc. of Amer. Wasatch Corporate Center 12,157 8.15% 02-Jan-07 Metropolitan Life Insurance Company 2600 West Olive 19,035 6.75% 01-Jan-09 Midland Loan Services Palomar Oaks 9,718 8.85% 01-Apr-09 Northwest Mutual 1255 23rd St (Note 1) 38,214 8.12% 01-Apr-09 Northwest Mutual 1730 Penn, I Square (Note 1) 183,327 8.12% 01-Apr-09 GE Capital South Coast 14,982 7.13% 10-Jun-09 Riggs 1775 Penn-Riggs 11,796 7.63% 01-Sep-09 Business Men's Assurance Co. Sorenson - Bus. Men's Assur. 2,278 7.75% 01-Jul-11 Berkshire Life Insurance Co. Sorenson - Berkshire 1,551 8.88% 01-May-17 Aid Association for Lutherans 1747 Penn 14,235 9.50% 10-Jul-17 Aid Association for Lutherans 900 19th St/Pres. Plaza 15,497 8.25% 15-Jul-19 ------------------ $544,778 8.09% ======== ====
($ in thousands) Principal Maturity -------------------------------------------------------- 2005 & Description of Notes/Lender 2001 2002 2003 2004 Thereafter - --------------------------- ------- ------- ------- ------- ---------- General Electric Capital Corp. $17,055 $ - $ - $ - $ - Techmart Commercial Ctr. 24 48 48 4 - Manufacturers Life 6,301 - - - - NY Life 38,533 - - - - NML 1,295 30,198 - - - Union Bank of California 353 746 10,114 - - GE Capital - - 24,164 - - Sun Life Assurance Company of Canada 129 276 302 4,345 - UBS Mortgage Finance Inc. 1,657 3,615 3,980 4,363 4,655 UBS Mortgage Finance Inc. 468 1,048 1,190 1,345 1,195 UBS Mortgage Finance Inc. 702 1,572 1,785 2,017 1,794 UBS Mortgage Finance Inc. 702 1,572 1,785 2,017 1,794 Salomon Brothers 224 477 519 564 24,581 State Farm 381 805 865 929 16,115 Farm Bureau Life Insurance Co. 32 68 74 80 3,083 Teachers Ins. and Ann. Assoc. of Amer. 116 247 268 291 11,235 Metropolitan Life Insurance Company - - - - 19,035 Midland Loan Services 84 179 196 214 9,045 Northwest Mutual 245 520 564 611 36,274 Northwest Mutual 1,171 2,490 2,700 2,927 174,039 GE Capital 111 235 252 270 14,114 Riggs 61 129 139 150 11,317 Business Men's Assurance Co. 77 163 176 190 1,672 Berkshire Life Insurance Co. 23 48 53 58 1,369 Aid Association for Lutherans 193 414 455 500 12,673 Aid Association for Lutherans 192 408 443 481 13,973 ------- ------- ------- ------- -------- $70,129 $45,258 $50,072 $21,356 $357,963 ======= ======= ======= ======= ========
Note 1: Secured by International Square, 1730 Pennsylvania Avenue and 1255 23rd Street. Note 2: Balance secured by Valley Business Park II and 3745 North First St. Note 3: Secured by Century Springs West, Glenridge, Midori, Lakewood and Parkwood. Note 4: Secured by Sunnyvale Technology Center, Highland Corporate Center, and Hacienda West Note 5: Capital lease 13 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Debt Capitalization Summary - continued - --------------------------------------------------------------------------------
($ In thousands) Unsecured Bonds Payable - ----------------------- Principal Maturity ------------------------------------------------------------ Principal Interest Maturity 2005 & Outstanding Rate Date 2001 2002 2003 2004 Thereafter ----------- -------- --------- ----------- ----------- ----------- --------- ---------- 7.200% Notes due 2004 $ 150,000 7.200% 1-Jul-04 $ - $ - $ - $ 150,000 $ - =========== =========== =========== =========== ========= ========== 7.375% Notes due 2007 $ 125,000 7.375% 1-Jul-07 $ - $ - $ - $ - $ 125,000 =========== =========== =========== =========== ========= ========== 6.625% Notes due 2005 $ 100,000 6.625% 1-Mar-05 $ - $ - $ - $ - $ 100,000 =========== =========== =========== =========== ========= ========== 6.875% Notes due 2008 $ 100,000 6.875% 1-Mar-08 $ - $ - $ - $ - $ 100,000 =========== =========== =========== =========== ========= ==========
Unsecured Line of Credit - ------------------------ Amount Amount Outstanding Outstanding Available Interest Maturity Beginning End Lender Commitment Rate Date of Year Advances Repayments of Month - ------ ----------- -------- --------- ----------- --------- ------------ ----------- Carr America Realty Corp. - ------------------------- Morgan Guaranty Trust $ - L+.700% N/A $ 176,000 $ 119,000 $ 295,000 $ - =========== =========== ========= ========== ========= JP Morgan Chase $ 408,212 L+.700% 28-Jun-04 $ - $ 90,000 $ - $ 90,000 =========== =========== ========= ========== =========
Note: LIBOR at 6/30/01 was as follows: 30 day 3.84% 90 day 3.79% 180 day 3.83% 14 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Investment Balances - --------------------------------------------------------------------------------
Investment Balance Accounting Percentage as of June 30, 2001 Method Ownership ($000) ------------------- ------------------- ----------------------------- Carr Office Park LLC Equity 35% 53,080 HQ Global Workplaces Cost 16% 42,249 1919 Pennsylvania Assoc. Equity 49% 17,448 1201 F Street Equity 35% 9,381 1717 Pennsylvania Equity 50% 7,606 300 W. Sixth Street Equity 20% 6,954 Custer Court Equity 49% 3,454 799 9th Street Equity 40% 2,974 CC JM II Equity 50% 2,972 AgilQuest Cost 15% 2,750 575 7th Street Equity 30% 2,646 WCM JV Equity 16% 1,808 e'ssention Cost 15% 146 153,468
15 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Current Summary of Portfolio Operating Properties As Of June 30, 2001 -----------------------------------------------------------------------------
Net Rentable Area in Number Square Percent of Feet/(1)/ Leased/(2)/ Buildings --------------- ------------- ------------ Consolidated Properties EAST REGION Downtown Washington, D.C.: International Square 1,014,556 100.0% 3 900 19th Street 101,215 100.0% 1 2550 M Street 187,931 100.0% 1 1730 Pennsylvania Avenue 229,377 100.0% 1 1255 23rd Street 306,395 99.3% 1 1747 Pennsylvania Avenue 152,104 99.8% 1 1775 Pennsylvania Avenue 143,981 97.5% 1 Suburban Washington, D.C.: One Rock Spring Plaza 205,721 98.4% 1 Sunrise Corporate Center 260,253 100.0% 3 Reston Crossing East & West 327,788 100.0% 2 Atlanta, GA: Glenridge 64,219 96.7% 1 Century Springs West 95,074 77.4% 1 Holcomb Place 72,889 100.0% 1 Midori 99,691 100.0% 1 Parkwood 150,270 98.9% 1 Lakewood 80,483 75.0% 1 The Summit 179,085 100.0% 1 Spalding Ridge 128,233 99.3% 1 2400 Lake Park Drive 100,918 78.6% 1 680 Engineering Drive 62,154 59.5% 1 Embassy Row 464,895 89.9% 3 Embassy 100, 500 190,470 100.0% 2 Waterford Centre 82,344 85.5% 1 East Region Subtotal: 4,700,046 96.6% 31 23.4% PACIFIC REGION Southern California, Orange County/Los Angeles: Scenic Business Park 138,076 100.0% 4 Harbor Corporate Park 151,924 97.7% 4 Plaza PacifiCare 104,377 100.0% 1 Katella Corporate Center 80,609 97.5% 1 Warner Center 343,486 99.7% 12 South Coast Executive Center 161,692 60.2% 2 Warner Premier 61,553 91.3% 1 Von Karman 104,138 100.0% 1 2600 W. Olive 144,831 100.0% 1 Bay Technology Center 107,481 100.0% 2 Pacific Corporate Plaza 1,2, & 3 125,298 100.0% 3 Alton Deere Plaza 182,183 78.2% 6 Westlake Spectrum 108,084 100.0% 2
16 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Current Summary of Portfolio Operating Properties As Of June 30, 2001 -----------------------------------------------------------------------------
Net Rentable Area in Number Square Percent of Feet/(1)/ Leased/(2)/ Buildings --------------- ------------- ------------ Southern California, San Diego: Del Mar Corporate Plaza 123,142 100.0% 2 Wateridge Pavilion 62,194 65.5% 1 Towne Center Technology Park 1, 2, 3 182,120 100.0% 3 Lightspan 64,800 100.0% 1 La Jolla Spectrum 1 & 2 156,653 100.0% 2 Palomar Oaks Technology Park 170,358 95.5% 6 Jaycor 105,358 100.0% 1 Highlands Corporate Center 205,085 94.2% 5 Northern California, San Francisco Bay Area: CarrAmerica Corporate Center 1,004,670 99.8% 7 Valley Business Park I 61,600 100.0% 2 Bayshore Centre 2 94,874 100.0% 1 Rincon Centre 201,178 100.0% 3 Valley Centre II 212,082 100.0% 4 Valley Office Centre 68,881 99.9% 2 Valley Centre 102,291 100.0% 2 Valley Business Park II 166,928 100.0% 6 Rio Robles 368,178 100.0% 7 3745 North First Street 67,582 100.0% 1 Baytech Business Park 300,000 100.0% 4 3571 North First Street 116,000 100.0% 1 San Mateo Center I 70,000 100.0% 1 Oakmead West Land A-G 425,981 100.0% 7 San Mateo II & III 141,404 100.0% 2 Hacienda West 208,590 93.8% 2 Sunnyvale Technology Center 165,520 100.0% 5 Clarify Corporate Center 1, 2, 3, 4 258,048 100.0% 4 Valley Technology Center 1, 2, 3, 4, 5, 6 & 7 460,590 100.0% 7 Golden Gateway Commons 273,801 95.3% 3 Techmart Commerce Center 266,003 89.6% 1 Freemont Technology Park 1, 2, 3 139,304 100.0% 3 Ellis @ Middlefield 236,400 100.0% 2 Portland, OR: Sunset Corporate Park 132,531 80.9% 3 Rock Creek Corp Center 142,662 100.0% 3 Seattle, WA: Redmond 396,497 100.0% 10 Redmond Hilltop B & C 90,880 100.0% 2 Canyon Park 316,978 98.5% 6 Willow Creek 96,179 100.0% 1 Willow Creek Corp. Center 1, 2, 3, 4, 5, & 6 329,009 100.0% 6 Canyon Park Commons 1, 2, 4 176,846 100.0% 3 Canyon Park Commons 95,290 100.0% 1 Pacific Region Subtotal 10,070,219 97.6% 173 50.1%
17 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Current Summary of Portfolio Operating Properties As Of June 30, 2001 -----------------------------------------------------------------------------
Net Rentable Area in Number Square Percent of Feet/(1)/ Leased/(2)/ Buildings --------------- ------------- ------------ CENTRAL REGION Austin, TX: City View Centre 136,183 100.0% 3 City View Centre 128,716 100.0% 1 Tower of the Hills 166,149 96.9% 2 Chicago, IL: Parkway North I 249,314 85.6% 1 Unisys 365,267 97.4% 2 The Crossings 295,308 95.3% 1 Bannockburn I & II 209,582 92.0% 2 Bannockburn IV 108,469 96.0% 1 Dallas, TX: Cedar Maple Plaza 113,256 76.6% 3 Quorum North 116,178 97.8% 1 Quorum Place 178,296 99.2% 1 Tollway Plaza 1, 2 359,903 100.0% 2 Two Mission Park 78,037 98.3% 1 Commons @ Las Colinas 1, 2, 3 604,234 100.0% 3 5000 Quorum 162,165 97.6% 1 Central Region Subtotal 3,271,057 96.3% 25 16.3% MOUNTAIN REGION Denver, CO: Harlequin Plaza 329,273 98.2% 2 Quebec Court I 130,000 100.0% 1 Quebec Court II 157,294 100.0% 1 Quebec Centre 106,865 87.5% 3 Dry Creek 3 92,356 100.0% 1 Phoenix, AZ: Qwest Communications 532,506 100.0% 4 Salt Lake City, UT: Sorenson Research Park 282,944 96.7% 5 Wasatch Corporate Center 178,231 100.0% 3 Wasatch Corporate Center 17, 18 121,654 100.0% 2 Sorenson X 41,288 100.0% 1 Creekside I & II 78,000 100.0% 1 Mountain Region Subtotal 2,050,411 98.6% 24 10.2% TOTAL CONSOLIDATED PROPERTIES: 20,091,733 253 100.0% WEIGHTED AVERAGE 97.2%
18 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Current Summary of Portfolio Operating Properties As Of June 30, 2001 - -------------------------------------------------------------------------------
Company's Net Rentable Effective Area in Number Property Square Percent of Property Ownership Feet/(1)/ Leased/(2)/ Buildings - -------- ---------- ------------ ----------- --------- Unconsolidated Properties Washington, D.C.: 1919 Pennsylvania Avenue 49.0% 328,431 98.7% 1 1201 F Street 35.0% 226,871 96.0% 1 Bond Building 15.0% 242,787 98.4% 1 1717 Pennsylvania Avenue 50.0% 236,455 100.0% 1 Booz-Allen & Hamilton Building 50.0% 222,989 100.0% 1 Portland, OR: GM Call Center 16.2% 103,279 100.0% 1 Chicago Market Office: Parkway 3, 4, 5, 6, 10 35.0% 653,914 99.2% 5 Dallas Market Office: Royal Ridge Phase II, A,B 35.0% 503,751 91.9% 4 Austin Market Office: Riata Corporate and Riata Crossing 35.0% 997,678 100.0% 13 Denver Market Office: Panorama I, II, III, V, VIII, X 35.0% 664,050 91.0% 6 TOTAL UNCONSOLIDATED PROPERTIES: 4,180,205 34 WEIGHTED AVERAGE 97.1% ALL OPERATING PROPERTIES TOTAL: 24,271,938 287 WEIGHTED AVERAGE 97.2%
/(1)/Includes office and retail space but excludes storage space. /(2)/Includes space for leases that have been executed and have commenced as of June 30, 2001. 19 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Lease Rollover Schedule - Stabilized Properties - --------------------------------------------------------------------------------
Current YTD Avg/ Vacant Region/Market Sq. Feet Occupancy Occupancy Sq. Feet 2001 2002 2003 2004 - ------------- ---------- ---------- --------- -------- ------- --------- --------- --------- PACIFIC REGION San Francisco Bay Area 5,409,905 99.0% 99.2% 55,586 164,790 552,940 663,700 658,788 Orange County/Los Angeles 1,813,732 93.6% 92.1% 115,871 55,423 239,064 229,414 286,438 Seattle 1,501,679 99.7% 99.7% 4,646 83,052 27,604 228,406 188,544 San Diego 1,069,710 96.2% 97.0% 41,014 72,693 26,400 136,136 81,636 Portland 275,193 90.8% 92.1% 25,365 - - - 31,497 MOUNTAIN REGION Denver 815,788 97.7% 96.6% 19,167 25,761 120,455 94,365 44,430 Phoenix 532,506 100.0% 100.0% - - - - - Salt Lake City 702,117 98.7% 98.0% 9,223 33,881 46,345 158,940 275,883 CENTRAL REGION Chicago 1,227,940 93.4% 92.3% 80,446 102,425 287,581 313,062 126,172 Dallas 1,612,069 97.8% 97.4% 35,897 67,289 142,224 279,913 136,112 Austin 431,048 98.8% 99.1% 5,086 104,027 14,964 34,330 255,074 EAST REGION Washington, DC Downtown Properties 2,135,559 99.7% 99.7% 5,897 38,956 175,020 236,360 520,069 Suburban Properties 793,762 99.6% 99.6% 3,198 3,884 39,922 27,339 87,504 Atlanta 1,770,725 91.4% 91.7% 152,038 139,288 442,073 416,900 170,776 Total 20,091,733 97.2% 97.1% 553,434 891,469 2,114,592 2,818,865 2,862,923
2011 & Region/Market 2005 2006 2007 2008 2009 2010 Thereafter - ------------- --------- --------- --------- --------- --------- ------- ---------- PACIFIC REGION San Francisco Bay Area 746,401 971,094 351,849 678,592 199,903 129,862 236,400 Orange County/Los Angeles 224,507 231,664 158,673 228,420 - 25,428 18,830 Seattle 467,058 101,413 - - 325,264 - 75,692 San Diego 83,956 81,499 - - 84,949 97,054 364,373 Portland 51,797 - 122,127 - - 44,407 - MOUNTAIN REGION Denver 179,564 145,197 - 186,849 - - - Phoenix - - 532,506 - - - - Salt Lake City 12,389 87,456 78,000 - - - - CENTRAL REGION Chicago 133,926 22,589 - 47,144 12,800 - 101,795 Dallas 86,834 38,747 22,643 131,479 440,872 223,470 6,589 Austin 7,387 10,180 - - - - - EAST REGION Washington, DC Downtown Properties 84,340 252,385 251,598 221,074 77,976 15,117 256,767 Suburban Properties 245,734 55,775 423 - 327,788 2,195 - Atlanta 84,567 37,825 87,306 - 39,482 75,711 124,759 Total 2,408,460 2,035,824 1,605,125 1,493,558 1,509,034 613,244 1,185,205
20 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Operating Portfolio Lease Economics - --------------------------------------------------------------------------------
2nd Quarter 2001 --------------------------------------------------------------------------------------------------- Total New GAAP Prior GAAP % Change Ave. Lease Lease Tenant Total T/I's Executed Rental Rental In GAAP Term in Commissions Improvements and L/C's Market Sq. Ft. Rate Rate Rental Rate Years Per Sq. Ft. Per Sq. Ft. Per Sq. Ft. - ------ ----------- -------- ---------- ------------ ---------- ----------- ------------ ----------- Atlanta 17,663 21.29 19.43 9.58% 3.17 4.55 12.63 17.18 Austin 4,238 21.37 20.79 2.79% 5.00 0.89 2.23 3.12 Chicago 77,859 24.56 22.96 6.95% 2.80 1.51 0.65 2.16 Dallas 17,748 20.63 19.55 5.50% 2.87 3.32 4.37 7.69 Denver 28,337 21.76 19.88 9.41% 5.88 1.54 6.97 8.51 Los Angeles/Orange County 139,763 25.17 18.39 36.86% 4.20 1.21 1.39 2.60 Salt Lake City 71,925 14.76 13.07 12.88% 2.33 - - - San Diego 50,544 14.66 14.33 2.24% 3.43 1.74 1.40 3.14 San Francisco Bay 206,968 47.67 26.05 83.01% 3.68 0.93 0.47 1.40 Seattle 95,832 26.01 25.35 2.61% 4.50 0.24 5.12 5.36 Suburban Washington DC 5,573 33.76 25.05 34.78% 3.01 - - - Downtown Washington DC 10,456 29.00 27.08 7.09% 4.17 - - - Total 726,906 31.13 21.90 42.19% 3.70 1.07 1.94 3.01
2001 Year-To-Date ---------------------------------------------------------------------------------------------------- Total New GAAP Prior GAAP % Change Ave. Lease Lease Tenant Total T/I's Executed Rental Rental In GAAP Term in Commissions Improvements and L/C's Market Sq. Ft. Rate Rate Rental Rate Years Per Sq. Ft. Per Sq. Ft. Per Sq. Ft. - ------ ----------- -------- ---------- ------------ ---------- ----------- ------------ ----------- Atlanta 90,541 21.17 19.53 8.42% 2.74 1.44 3.83 5.27 Austin 13,048 23.53 21.36 10.19% 3.44 0.94 7.93 8.87 Chicago 134,396 25.31 24.32 4.06% 3.32 1.30 1.06 2.36 Dallas 48,589 22.10 22.34 -1.06% 3.02 3.27 4.43 7.70 Denver 65,031 21.64 19.83 9.12% 5.16 2.94 8.79 11.73 Los Angeles/Orange County 284,150 24.65 21.40 15.20% 4.63 3.42 8.78 12.20 Salt Lake City 79,049 14.46 13.43 7.66% 3.00 0.37 2.00 2.37 San Diego 93,530 13.85 13.59 1.92% 3.67 2.32 2.57 4.89 San Francisco Bay 237,152 48.89 26.36 85.44% 3.95 1.78 0.80 2.58 Seattle 147,027 22.05 20.69 6.55% 4.50 0.52 4.48 5.00 Suburban Washington DC 5,573 33.76 25.05 34.78% 3.01 - - - Downtown Washington DC 10,456 29.00 27.08 7.09% 4.17 - - - Total 1,208,542 27.78 21.43 29.60% 3.79 1.97 4.23 6.20
21 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES 25 Largest Tenants - Based on Annualized Base Rent - --------------------------------------------------------------------------------
Percentage Percentage of of Portfolio Occupied Annualized Square Square Tenant Rent Feet Feet ------ ---------- ------ ----------- INTERNATIONAL MONETARY FUND 3.95% 504,401 2.54% NOKIA, INC. 2.99% 624,904 3.15% AT&T 2.30% 658,940 3.32% QWEST COMMUNICATIONS 2.27% 532,506 2.68% APPLIED MATERIALS, INC. 2.23% 425,981 2.15% PEOPLESOFT, INC. 2.05% 359,686 1.81% PATTON BOGGS, L.L.P. 1.92% 187,653 0.94% NEXTEL COMMUNICATIONS, INC. 1.60% 331,203 1.67% NORTEL NETWORKS, INC. 1.56% 258,048 1.30% SUN MICROSYSTEMS, INC. 1.44% 239,608 1.21% CITIGROUP 1.37% 227,135 1.14% SBC COMMUNICATIONS 1.16% 202,093 1.02% SOFTWARE AG OF NORTH AMERICA 1.14% 209,521 1.06% LATTICE SEMICONDUCTOR CORP 1.08% 216,650 1.09% SAFECO INSURANCE CO OF AMERICA 0.97% 265,658 1.34% FEDERAL DEPOSIT INSURANCE CORP 0.93% 121,878 0.61% BOSTON SCIENTIFIC 0.87% 212,082 1.07% UNISYS CORPORATION 0.83% 197,404 0.99% KING & SPALDING 0.83% 92,596 0.47% THE WALT DISNEY COMPANY 0.77% 129,347 0.65% KPMG, L.L.P. 0.76% 135,558 0.68% WASHINGTON MUTUAL 0.75% 220,453 1.11% TSMC NORTH AMERICA, INC. 0.73% 110,590 0.56% CHRONICLE OF HIGHER EDUCATION 0.71% 91,990 0.46% STELLCOM, INC. 0.66% 97,054 0.49% ------- --------- ----- Total 35.87% 6,652,939 33.51% ======= ========= =====
22 CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Current Development Activity by Market - --------------------------------------------------------------------------------
Estimated Construction Estimated Wholly Owned Property Start Completion Stabilization Under Construction @ June 30, 2001 Square Feet Date Date Date - --------------------------------------------------------------------------------------------------------------------------------- Atlanta The Forum 90,000 4Q00 4Q01 4Q02 ----------------- Atlanta Subtotal 90,000 Denver Dry Creek Corporate Center Building 2 92,354 1Q01 4Q01 4Q02 ----------------- Denver Subtotal 92,354 Austin Braker 3 192,451 2Q00 3Q01 3Q01 ----------------- Austin Subtotal 192,451 Total/Weighted Average 374,805 Less: Placed in Service - ----------------- Total/Weighted Average 374,805 ================= Partially Owned Property % Under Construction @ June 30, 2001 (1) Ownership - --------------------------------------------------------------------------------------------------------------------------------- Austin 300 West Sixth Street 20% 444,870 2Q00 4Q01 3Q02 ----------------- Austin Subtotal 444,870 Chicago Nine Parkway North 35% 129,433 4Q00 4Q01 4Q02 ----------------- Chicago Subtotal 129,433 Dallas Custer Court 49% 120,047 3Q00 3Q01 1Q02 Royal Ridge Bldg 7 35% 132,756 2Q00 1Q01 1Q02 ----------------- Dallas Subtotal 252,603 Washington, DC 799 9th Street 40% 201,464 2Q00 4Q01 4Q02 ----------------- Washington, DC Subtotal 201,464 Total/Weighted Average 1,028,570 Less: Placed in Service (89,551) ----------------- Total/Weighted Average 939,019 ================= Total/Weighted Average Wholly & Partially Owned 1,313,824 =================
Estimated Remaining Total Estimated % Currently Wholly Owned Property In Place Costs to Projected Stabilized Leased or Under Construction @ June 30, 2001 Dev Costs Complete Investment Return Committed - ---------------------------------------------------------------------------------------------------------------------------------- Atlanta The Forum 6,399 5,965 12,364 10.7% 72.2% ------------- ------------- ------------- -------------- ------------ Atlanta Subtotal 6,399 5,965 12,364 10.7% 72.2% Denver Dry Creek Corporate Center Building 2 1,949 9,629 11,578 10.5% 0.0% ------------- ------------- ------------- -------------- ------------ Denver Subtotal 1,949 9,629 11,578 10.5% 0.0% Austin Braker 3 24,201 6,601 30,802 12.1% 100.0% ------------- ------------- ------------- -------------- ------------ Austin Subtotal 24,201 6,601 30,802 12.1% 100.0% Total/Weighted Average 32,549 22,195 54,744 11.4% 68.7% Less: Placed in Service - - - ------------- ------------- ------------- Total/Weighted Average 32,549 22,195 54,744 11.4% 68.7% ============= ============= ============= ============== ============ Partially Owned Property Under Construction @ June 30, 2001 (1) - ---------------------------------------------------------------------------------------------------------------------------------- Austin 300 West Sixth Street 37,268 55,743 93,011 10.8% 66.7% ------------- ------------- ------------- -------------- ------------ Austin Subtotal 37,268 55,743 93,011 10.8% 66.7% Chicago Nine Parkway North 9,734 13,222 22,956 9.9% 0.0% ------------- ------------- ------------- -------------- ------------ Chicago Subtotal 9,734 13,222 22,956 9.9% 0.0% Dallas Custer Court 6,011 9,847 15,858 10.9% 42.2% Royal Ridge Bldg 7 12,402 3,173 15,575 11.3% 67.5% ------------- ------------- ------------- -------------- ------------ Dallas Subtotal 18,413 13,020 31,433 11.1% 55.5% Washington, DC 799 9th Street 42,911 18,321 61,232 9.6% 74.3% ------------- ------------- ------------- -------------- ------------ Washington, DC Subtotal 42,911 18,321 61,232 9.6% 74.3% Total/Weighted Average 108,326 100,306 208,632 10.4% 57.0% Less: Placed in Service (9,226) (1,280) (10,506) ------------- ------------- ------------- Total/Weighted Average 99,100 99,026 198,126 10.4% 52.9% ============= ============= ============= ============== ============ Total/Weighted Average Wholly & Partially Owned 131,649 121,221 252,870 10.6% 57.4% ============= ============= ============= ============== ============
23 CARRAMERICA REALTY CORPORAION AND SUBSIDIARIES Land Held for Future Development - -------------------------------------------------------------------------------
Buildable Office Square Region/Property Market Acres Feet - ---------------------------------- ------------ --------- ----------------- Wholly Owned Land - ----------------- Pacific Region Canyon Pointe A-G Seattle, WA 10 173,760 Sunset Corporate Portland, OR 9 124,800 ------- ----------------- Subtotal 19 298,560 Mountain Region Dry Creed Corporate Center Denver, CO 43 678,000 Sorenson Research Park XI Salt Lake City, UT 6 80,238 Wasatch 16 Salt Lake City, UT 5 80,238 Creekside 2 owned Salt Lake City, UT 6 78,000 Creekside 3 optioned Salt Lake City, UT 6 78,452 ------- ----------------- Subtotal 66 994,928 Central Region Braker Pointe Austin, TX 4 - Tollway Plaza III Dallas, TX 4 134,400 Royal Ridge IV & V Dallas, TX 29 417,000 ------- ----------------- Subtotal 37 551,400 Eastern Region Peninsula Corporate Center 1-2 Boca Raton, FL 20 221,350 675 E Street Washington, DC - - ------- ----------------- Subtotal 20 221,350 ------- ----------------- Total 142 2,066,238 ======= ================= Partially Owned Land - -------------------- Mountain Region Panorama IV Denver, CO 8 136,850 Panorama VI Denver, CO 9 129,898 Panorama VII Denver, CO 6 100,000 Panorama IX Denver, CO 6 125,490 ------- ----------------- Subtotal 29 492,238 Central Region Riata 1 Austin, TX 4 61,585 Riata Crossing 4 Austin, TX 5 79,780 Riata Crossing 6 Austin, TX 8 49,702 Seven/Eight Parkway North Chicago, IL 14 250,567 Royal Ridge Bldgs 4-6 Dallas, TX 18 316,786 Royal Ridge Bldg 8 Dallas, TX 9 132,709 ------- ----------------- 58 891,129 Eastern Region 575 7th Street Washington, DC 1 473,000 ------- ----------------- Total 88 1,856,367 ======= ================= Total All Land 230 3,922,605 ======= =================
24 EX-99.2 4 dex992.txt EXHIBIT 99.2 Immediate Karen L. Widmayer: Media Contact (202) 729-1789 Stephen Walsh: Analyst Contact (202) 729-1764 CARRAMERICA ANNOUNCES SECOND QUARTER 2001 FINANCIAL RESULTS Washington D.C. - August 3, 2001 - CarrAmerica Realty Corporation (NYSE:CRE) today reported second quarter Funds From Operations (FFO) from continuing operations of $58.7 million or $.84 per diluted share, a 13.5% increase over the same period in 2000. Excluding the impact of termination fee revenue, FFO per share increased approximately 18.6% over the same period in 2000. FFO for the six month period ended June 30, 2001 was $113.3 million or $1.61 per diluted share as compared to $108.9 million or $1.47 per diluted share for the same period in 2000, a 9.5% increase. Diluted earnings per share (EPS) from continuing operations were $0.38 for the second quarter of 2001 as compared to $0.31 for the second quarter of 2000, a 22.6% increase. For the first six months of 2001, diluted earnings per share from continuing operations were $0.71 compared to $0.68 for the same period a year ago, a 4.4% increase. CarrAmerica President and Chief Executive Officer, Thomas A. Carr, commented, "The year 2001 continues to be a challenging year for the real estate industry." Mr. Carr continued, "CarrAmerica's second quarter demonstrates strong operating results resulting from the company's focus on occupancy and cost control together with an excellent quarter for our service businesses." Portfolio Recognizes Rental Rate Increases of 42.2% - --------------------------------------------------- Performance of operating properties remains strong with an average occupancy of 97.2% at June 30, 2001, up from 97.0% as of March 31, 2001. Same store portfolio operating income during the quarter grew 3.7% on a GAAP basis and 4.1% on a cash basis over the same period in 2000. The occupancy rate for same store properties was 96.8% in the second quarter of 2001 as compared to 97.8% for second quarter 2000. Excluding the impact of termination fee revenue on the same store net operating income, the same store net operating income grew by 7.3% on a GAAP basis and 7.8% on a cash basis over the second quarter 2000. -CONTINUED- CarrAmerica Release of August 3, 2001 Page Two For the second quarter, rental rates increased 42.2% on average on the rolling leases executed during the quarter. Rental rates increased 29.6% on average on the rolling leases executed during the six-month period ended June 30, 2001. Development Update - ------------------ As of June 30, 2001, CarrAmerica and its subsidiary, CarrAmerica Development, Inc., had approximately 375,000 square feet under development in three of the Company's markets. Total cost of this development is expected to be approximately $54.7 million, of which $32.5 million had been invested as of June 30, 2001. This development pipeline is currently 68.7% leased or committed and the year-one unleveraged return on CarrAmerica's invested capital is expected to be approximately 11.4%. CarrAmerica and its subsidiary own a partial interest in five development projects totaling approximately 939,000 square feet under development in four markets. The total cost of these projects is expected to be $198.1 million and the projects are currently 52.9% leased or committed. CarrAmerica's share of the total project costs for these developments is expected to be approximately $60.7 million and the year-one unleveraged return on CarrAmerica's invested capital (exclusive of fees) is expected to be approximately 10.4%. During the second quarter, CarrAmerica subsidiary CarrAmerica Urban Development, LLC commenced construction on 1750 H Street, a 112,000 square foot project in downtown Washington, D.C. The project is 35% leased. CarrAmerica Urban Development is acting as a fee developer and CarrAmerica Realty Corporation is a mezzanine lender on the project. Also during the second quarter, CarrAmerica Urban Development, LLC entered into a joint venture with a client of JPMorgan Fleming Asset Management for the development of 575 Seventh Street, a 478,000 square foot office project across from the MCI Arena. The $153 million project is 51% leased to Venable, Baetjer, Howard and Civiletti, LLP and will commence construction in the third quarter. CarrAmerica Urban Development, LLC will also be developing an adjacent 29-unit residential project. During the second quarter, CarrAmerica and its subsidiary placed in service approximately 77,000 square feet of new office space with total project costs of approximately $24.4 million at an expected year-one unleveraged return on invested capital of approximately 15.3%. In addition, 162,000 square feet were placed in service in partially owned projects in which CarrAmerica owns approximately 35% on average, with total project costs of $26.0 million and an average yield of 10.6%. Also during the second quarter, CarrAmerica and its subsidiary announced two new fee development projects in downtown Washington, D.C.: The Freedom Forum selected CarrAmerica Urban Development, LLC, to serve as project manager for the development of The Freedom Forum/Newseum building on Pennsylvania Avenue. This project will relocate The Freedom Forum and the Newseum, the interactive -CONTINUED- CarrAmerica Release of August 3, 2001 Page Three museum of news, from nearby Arlington to the corner of Pennsylvania Avenue and 6th Street, N.W., just west of the Capitol. The project, which encompasses museum exhibit space, office and residential components, will significantly expand and update the Newseum's content and will more than double the exhibit space in the current museum. CarrAmerica Urban Development, LLC was also selected to assist in the development of a second headquarters building for the International Monetary Fund (IMF) to be located on Pennsylvania Avenue adjacent to the IMF's existing headquarters at 700 19th Street in Washington, D.C. CarrAmerica Urban Development will act as Development Manager responsible for the overall management and administration of the project including planning, design, zoning approvals, construction, occupancy and commissioning of IMF's second headquarters building. The building will feature a dramatic atrium, three levels of underground parking, a 450-seat meeting facility, food service and a state-of-the-art training facility. Fee Service Revenue Continues to Grow - ------------------------------------- During the second quarter, CarrAmerica and its affiliates generated real estate service revenue of $9.7 million, an increase of 82.7% over the prior year. Fee service revenue continues to grow driven by management and development fees received by CarrAmerica's services businesses in the areas of build-to-suit development, project and construction management, leasing and facility and property management services for third party customers. Acquisitions - ------------ During the second quarter, CarrAmerica purchased two buildings totaling 235,000 square feet in Mountain View, California for $51 million. The project has long-term leases with KPMG and AOL-Time Warner. CarrAmerica was previously a lender on the project and exercised an option to purchase the property for an additional $1 million. The purchase was completed as part of a 1031 exchange. In addition, during the second quarter, a partnership in which CarrAmerica is a 49% partner completed the acquisition of 2025 M Street, a 189,000 square foot office building in downtown Washington, D.C. for $37.9 million. The purchase was completed as part of a 1031 exchange. Dispositions - ------------ During the second quarter, CarrAmerica sold a $2.2 million land parcel in Austin, Texas. In addition, CarrAmerica has one building in suburban Denver, Colorado under contract for sale at a price of $12 million. The sale is expected to close in the fourth quarter. The Company anticipates the proceeds from the sale of these assets to be used to repay amounts outstanding on the Company's line of credit, to fund future development project costs and for other general corporate purchases. There can be no assurance that any pending disposition will occur on such terms or at all. -CONTINUED- CarrAmerica Release of August 3, 2001 Page Four Capital Markets and Finance - --------------------------- In the second quarter, CarrAmerica closed on a new three-year $500 million credit facility with a syndicate of banks arranged by J.P. Morgan Securities Inc. The terms were substantially similar to the previous credit facility. Additionally, Carr Office Park, LLC, a joint venture with New York State Teachers' Retirement System, closed on a ten-year, $225 million financing. The loan was provided by Northwestern Mutual Life Company and the State of Wisconsin Investment Board at an interest rate of 7.13%. This represents an approximately 60% loan on the value of the stabilized assets. Also in the second quarter, Moody's Investor Service upgraded the senior unsecured rating of CarrAmerica to Baa2, from Baa3, and revised the ratings outlook to stable, from positive. CarrAmerica Stock Repurchase Plan Expanded - ------------------------------------------ CarrAmerica has purchased approximately $209.4 million of its common stock to date under the previously announced $275 million share repurchase program. The average price per share has been $28.94. CarrAmerica also announced that its Board of Directors has authorized an expansion of the existing share repurchase program of up to an additional $50 million of its outstanding shares. In addition its Board of Directors expanded the program to include preferred shares and outstanding debt securities. These additional securities will be purchased under the same terms and conditions as the existing program. CarrAmerica Earnings Estimates - ------------------------------ On Monday, August 6, CarrAmerica management will discuss earnings guidance for 2001 and 2002. Based on management's view of current market conditions and certain assumptions with regard to rental rates and other projections (including the impact of the Company's stock repurchase program), a range of fully diluted FFO per share of $3.26 - $3.28 for 2001 will be discussed. In addition, a range of fully diluted FFO per share of $3.55 - $3.57 for 2002 will be discussed. CarrAmerica Announces Second Quarter Dividend - --------------------------------------------- The Board of Directors of CarrAmerica yesterday declared a second quarter dividend for its common stock and its Series A Cumulative Convertible Redeemable preferred stock of $.4625 per share. The dividends will be payable to common and Series A preferred shareholders of record as of the close of business on August 17, 2001. CarrAmerica's common stock will begin trading ex-dividend on August 15, 2001, and the dividends payable to common shareholders will be paid on August 31, 2001. Dividends payable to Series A preferred shareholders will be paid on August 31, 2001. -CONTINUED- CarrAmerica Release of August 3, 2001 Page Five The Company also declared a regular dividend for its Series B, Series C, and Series D preferred stock. The Series B Cumulative Redeemable preferred stock dividend was declared to be $.535625 per share, the Series C Cumulative Redeemable preferred stock dividend was declared to be $.534375 per share, and the Series D Cumulative Redeemable preferred stock dividend was declared to be $.528125 per share. The Series B, Series C and Series D preferred stock dividends are payable to shareholders of record as of the close of business on August 17, 2001. Such preferred stock will begin trading ex-dividend on August 15, 2001 and the dividends will be paid on August 31, 2001. CarrAmerica Second Quarter Webcast and Conference Call - ------------------------------------------------------ CarrAmerica will conduct a conference call to discuss the second quarter 2001 operations on Monday, August 6, 2001 at 11:00 a.m. EST. A live webcast of the call will be available through a link at CarrAmerica's web site, www.carramerica.com. The phone number for the conference call is 1-800-982- - ------------------- 3654; for local Washington, D.C. area and international participants, 703-871- 3021; and 0800-215-1724 for Netherlands participants. The call is open to all interested persons. A taped replay of the conference call can be accessed immediately after the call through August 13, 2001, by dialing 1-888-266-2081 or 703-925-2533 for local Washington, D.C. area and international participants (access code 5373958 for all callers.) A copy of supplemental material on the Company's second quarter operations is available on the Company's web site, www.carramerica.com, or by request from: Stephen Walsh CarrAmerica Realty Corporation 1850 K Street, NW, Suite 500 Washington, D.C. 20016 (Telephone) 202-729-1764 E-Mail) swalsh@carramerica.com ---------------------- CarrAmerica owns, develops and operates office properties in 12 markets throughout the United States. The Company is committed to becoming America's leading office workplace company by meeting the rapidly changing needs of its customers with superior service, a large portfolio of quality office properties, extraordinary development capabilities and land positions. CarrAmerica is a leading office innovator with interests in and strategic relationships with companies including: HQ Global Workplaces, a global leader in executive office suites; essention, the engine behind InfoCentre, a web-based operations and issues management platform and DukeSolutions, a Duke Energy subsidiary providing comprehensive energy management programs. -CONTINUED- CarrAmerica Release of August 3, 2001 Page Six Currently, CarrAmerica and its affiliates own, directly or through joint ventures, interests in a portfolio of 287 operating office properties and have eight office buildings under development in six key growth markets. CarrAmerica's markets include Atlanta, Austin, Chicago, Dallas, Denver, Los Angeles/Orange County, Portland, Salt Lake City, San Diego, San Francisco Bay Area, Seattle and metropolitan Washington, D.C. For additional information on CarrAmerica, including space availability, visit our web site at www.carramerica.com. Estimates of FFO per share are by definition, and certain statements in this release may constitute, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform Act"). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance, achievements or transactions of the Company and its affiliates or industry results to be materially different from any future results, performance, achievements or transactions expressed or implied by such forward-looking statements. Such factors include, among others, the following: national and local economic, business and real estate conditions that will, among other things, affect demand for office properties, availability and creditworthiness of tenants, the level of lease rents and the availability of financing for both tenants and the Company, adverse changes in the real estate markets including, among other things, competition with other companies, risks of real estate acquisition and development (including the failure of pending acquisitions to close and pending developments to be completed on time and within budget), actions, strategies and performance of affiliates that the Company may not control, governmental actions and initiatives, and environmental/safety requirements. For a further discussion of these and other factors that could impact the Company's future results, performance, achievements or transactions, see the documents filed by the Company from time to time with the Securities and Exchange Commission, and in particular the section titled, "The Company - Risk Factors" in the Company's Annual Report of Form 10-K. -CONTINUED- CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets - --------------------------------------------------------------------------------
(In thousands) June 30, December 31, 2001 2000 -------------------- -------------------- (unaudited) Assets - ------ Rental property Land $ 644,799 $ 644,326 Buildings 1,825,629 1,836,214 Tenant improvements 338,606 325,936 Furniture, fixtures and equipment 3,521 6,844 -------------------- -------------------- 2,812,555 2,813,320 Less: Accumulated depreciation (422,617) (381,260) -------------------- -------------------- Net rental property 2,389,938 2,432,060 Land held for future development or sale 44,599 47,984 Construction in progress 32,549 48,300 Cash and cash equivalents 14,482 24,704 Restricted deposits 7,288 39,482 Accounts and notes receivable 32,374 70,693 Investments in unconsolidated entities 153,468 269,193 Accrued straight-line rents 59,189 54,960 Tenant leasing costs, net 52,030 54,522 Deferred financing costs, net 9,760 11,311 Prepaid expenses and other assets, net 25,495 19,632 -------------------- -------------------- $ 2,821,172 $ 3,072,841 ==================== ==================== Liabilities and Stockholders' Equity - ------------------------------------ Liabilties: Mortgages and notes payable $ 1,109,778 $ 1,211,158 Accounts payable and accrued expenses 64,778 96,147 Rent received in advance and security deposits 29,892 29,143 -------------------- -------------------- 1,204,448 1,336,448 Minority interest 85,993 89,687 Stockholders' equity: Preferred stock 89 93 Common stock 621 650 Additional paid in capital 1,653,396 1,755,985 Cumulative dividends in excess of net income (123,375) (110,022) -------------------- -------------------- 1,530,731 1,646,706 -------------------- -------------------- Commitments and contingencies $ 2,821,172 $ 3,072,841 ==================== ====================
CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations - ----------------------------------------------------------------------
(In thousands, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, ---------------------------- ---------------------------- 2001 2000 2001 2000 ------------- ------------- ------------- ------------- (unaudited) (unaudited) Revenues: Rental income (1): Minimum base rent $ 105,802 $ 115,303 $ 212,012 $ 229,183 Recoveries from tenants 14,683 17,505 28,724 34,339 Parking and other tenant charges 3,338 6,319 6,876 12,230 ----------- ----------- ----------- ----------- Total rental revenue 123,823 139,127 247,612 275,752 Real estate service income 9,703 5,312 19,840 10,253 ----------- ----------- ----------- ----------- Total operating revenues 133,526 144,439 267,452 286,005 ----------- ----------- ----------- ----------- Operating expenses: Property expenses: Operating expenses 28,433 31,930 60,474 64,212 Real estate taxes 10,050 12,572 19,617 24,518 Interest expense 21,136 25,115 41,996 52,005 General and administrative 11,939 12,001 26,340 21,773 Depreciation and amortization 30,820 35,170 61,645 67,319 ----------- ----------- ----------- ----------- Total operating expenses 102,378 116,788 210,072 229,827 ----------- ----------- ----------- ----------- Real estate operating income 31,148 27,651 57,380 56,178 Other income: Interest income 1,023 873 2,127 1,750 Equity in earnings of unconsolidated entities 3,674 1,267 7,028 2,716 ----------- ----------- ----------- ----------- Total other income 4,697 2,140 9,155 4,466 ----------- ----------- ----------- ----------- Income from continuing operations before income taxes, minority interest and (loss) gain on sale of assets and other provisions, net 35,845 29,791 66,535 60,644 Income taxes (187) - (234) - Minority interest (3,076) (2,353) (4,529) (5,408) (Loss) gain on sale of assets and other provisions, net (22) 2,387 1,054 7,741 ----------- ----------- ----------- ----------- Income from continuing operations $ 32,560 $ 29,825 $ 62,826 $ 62,977 Discontinued operations - Income from operations of discontinued Executive Suites subsidiary (less applicable income tax expense) - 1,836 - 456 Discontinued operations - Gain on sale of discontinued operations (less applicable income tax expense of $21,131) - 31,852 - 31,852 ----------- ----------- ----------- ----------- Net income $ 32,560 $ 63,513 $ 62,826 $ 95,285 =========== =========== =========== =========== Basic net income per share: Net income from continuing operations $ 0.39 $ 0.31 $ 0.73 $ 0.68 Discontinued operations - 0.03 - - Gain on discontinued operations - 0.48 - 0.48 ----------- ----------- ----------- ----------- Net income $ 0.39 $ 0.82 $ 0.73 $ 1.16 =========== =========== =========== =========== Diluted net income per share: Net income from continuing operations $ 0.38 $ 0.31 $ 0.71 $ 0.68 Discontinued operations - 0.03 - - Gain on discontinued operations - 0.43 - 0.44 ----------- ----------- ----------- ----------- Net income $ 0.38 $ 0.77 $ 0.71 $ 1.12 =========== =========== =========== ===========
NOTE: (1) Rental income includes $2,897 and $3,465 of accrued straight line rents for the three months periods ended June 30, 2001 and 2000, respectively, and $5,263 and $6,466 of accrued straight line rents for the six months period ended June 30, 2001 and 2000, respectively. CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flow - --------------------------------------------------------------------------------
(Unaudited and in thousands) Six Months Ended June 30, -------------------------- 2001 2000 Cash flow from operating activities: Net income $ 62,826 $ 95,285 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 61,645 67,370 Minority interest 4,529 5,408 Equity in earnings of unconsolidated entities (7,028) (2,716) Gain on sale of assets and other provisions, net (1,054) (7,741) Income and gain on sale of discontinued operations - (32,308) Provision for uncollectible accounts 4,703 1,549 Stock based compensation 1,469 1,553 Other 264 (1,140) Change in assets and liabilities: Decrease (increase) in accounts receivable 16,140 (5,689) Increase in accrued straight-line rents (5,417) (6,466) Additions to tenant leasing costs (5,519) (9,059) Increase in prepaid expenses and other assets (7,866) (9,876) Decrease in accounts payable and accrued expenses (32,221) (5,080) Increase in rent received in advance and security deposits 1,279 3,095 ------------ ------------ Total adjustments 30,924 (1,100) ------------ ------------ Net cash provided by operating activities 93,750 94,185 ------------ ------------ Cash flows from investing activities: Acquisition and development of rental property (16,207) (46,825) Additions to land held for development or sale (34,840) (11,071) Additions to construction in progress (19,215) (33,493) Acquisitions and development of executive suites assets - (6,678) Payments on notes receivable 16,539 139 Distributions from unconsolidated entities 89,616 3,568 Investments in unconsolidated entities (10,440) (9,875) Acquisition of minority interest (3,289) (1,478) Decrease (increase) in restricted cash and cash equivalents 32,194 (322) Proceeds from the sale of discontinued operations - 377,310 Proceeds from sales of properties 100,474 62,883 ------------ ------------ Net cash provided by investing activities 154,832 334,158 ------------ ------------ Cash flows from financing activities: Repurchase of common stock (119,210) (28,450) Exercises of stock options 16,082 9,945 Net repayments on unsecured credit facility (86,000) (317,500) Net repayments of mortgages payable (15,502) (7,849) Proceeds from mortgages 26,628 - Dividends and distributions to minority interests (80,802) (85,524) Contributions from minority interests - 1,948 ------------ ------------ Net cash used by financing activities (258,804) (427,430) ------------ ------------ (Decrease) increase in unrestricted cash and cash equivalents (10,222) 913 Unrestricted cash and cash equivalents, beginning of the period 24,704 51,886 ------------ ------------ Unrestricted cash and cash equivalents, end of the period $ 14,482 $ 52,799 ============ ============ Supplemental disclosure of cash flow information: Cash paid for interest (net of capitalized interest of $3,837 and $16,378 for the six months ended June 30, 2001 and 2000, respectively) $ 49,207 $ 60,106 ============ ============
CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES Funds From Operations - --------------------------------------------------------------------------------
(In thousands, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, ------------------------- --------------------------- 2001 2000 2001 2000 ----------- ------------ ------------ ------------ Net income from continuing operations before minority interest: $ 35,636 $ 32,178 $ 67,355 $ 68,385 Adjustments to derive funds from continuing operations: Add: Depreciation and amortization - REIT properties 29,540 33,351 59,162 64,134 Depreciation and amortization - Equity properties 2,211 1,030 5,295 1,689 Deduct: Minority interests' (non Unitholders) share of depreciation, amortization and net income (219) (218) (501) (473) Loss (gain) on sale of assets and other provisions, net 22 (2,387) (1,054) (7,741) ----------- ------------ ------------ ------------ FFO from continuing operations before allocations to minority Unitholders 67,190 63,954 130,257 125,994 Less: FFO allocable to the minority Unitholders (4,507) (3,794) (8,344) (8,231) ----------- ------------ ------------ ------------ CarrAmerica Realty Corporation's FFO from continuing operations 62,683 60,160 121,913 117,763 Less: Preferred stock dividends (8,746) (8,745) (17,395) (17,522) ----------- ------------ ------------ ------------ CarrAmerica Realty Corporation's FFO from continuing operations attributable to common shares 53,937 51,415 104,518 100,241 Discontinued operations -- 8,473 -- 13,368 Gain on sale of discontinued operations -- 31,852 -- 31,852 ----------- ------------ ------------ ------------ CarrAmerica Realty Corporation's FFO attributable to common shares $ 53,937 $ 91,740 $104,518 $145,461 =========== ============ ============ ============ Weighted average common shares outstanding: Basic 61,840 66,856 62,509 66,912 Diluted 69,494 74,684 70,353 74,292 Basic funds from operations per common share: Funds from continuing operations $ 0.87 $ 0.77 $ 1.67 $ 1.50 Funds from discontinued operations -- 0.13 -- 0.20 Funds from sale of discontinued operations -- 0.48 -- 0.48 ----------- ------------ ------------ ------------ Total funds from operations $ 0.87 $ 1.38 $ 1.67 $ 2.18 =========== ============ ============ ============ Diluted funds from operations per common share: Funds from continuing operations $ 0.84 $ 0.74 $ 1.61 $ 1.47 Funds from discontinued operations -- 0.11 -- 0.18 Funds from sale of discontinued operations -- 0.43 -- 0.43 ----------- ------------ ------------ ------------ Total funds from operations $ 0.84 $ 1.28 $ 1.61 $ 2.08 =========== ============ ============ ============ CarrAmerica Realty Corporation FFO attributed to common share from continuing operations $ 53,937 $ 51,415 $104,518 $100,241 Series A Preferred share dividends 221 221 440 474 Minority interest from convertible partnership units 4,507 3,794 8,344 8,232 ----------- ------------ ------------ ------------ Adjusted FFO attributable to common shares from continuing operations $ 58,665 $ 55,430 $113,302 $108,947 =========== ============ ============ ============ Weighted average common shares outstanding - Basic 61,840 66,856 62,509 66,912 Weighted average conversion of Series A Preferred shares 392 480 436 510 Weighted average conversion of operating partnership units 6,062 6,470 6,068 6,475 Incremental options 1,200 878 1,340 395 ----------- ------------ ------------ ------------ Adjusted weighted average common shares - Diluted 69,494 74,684 70,353 74,292 =========== ============ ============ ============
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