INDIANAPOLIS--(BUSINESS WIRE)--
Kite Realty Group Trust (NYSE: KRG) (the “Company”) announced operating
results for the second quarter ended June 30, 2016. The attached
financial statements, exhibits and reconciliations of non-GAAP measures
provide the details of these results.
Second Quarter Highlights
-
Net loss attributable to common shareholders was $1.9 million, or
$0.02 per diluted common share, including $2.8 million ($0.03 per
diluted common share) of transaction costs.
-
Funds From Operations (“FFO”), as adjusted, increased 6% compared to
the same period in the prior year and was $0.52 per diluted common
share, or $44.2 million.
-
Small shop occupancy was 88.3%, an increase of 210 basis points
compared to the same period in the prior year.
-
Same-property NOI, which includes 102 retail operating properties,
increased 2.6% for the comparable operating portfolio and 3.6%
excluding the impact of the Company’s Redevelopment, Repurpose and
Reposition ("3-R") initiative, both percentages compared to the same
period in the prior year.
-
Ground-up development projects were substantially completed at Tamiami
Crossing (Naples, FL) and Holly Springs Towne Center (Phase II)
(Raleigh/MSA, NC), and these properties were transitioned into the
operating portfolio.
-
The Company commenced construction on three additional 3-R projects,
for a total of eight projects in process. These eight projects have an
estimated incremental return averaging approximately 9% to 11%, and
aggregate costs for all of these projects are expected to range
between $40.5 million and $47.0 million.
-
Guidance for 2016 FFO, as adjusted, increased to a range of $2.04 to
$2.08 per diluted common share from a range of $2.02 to $2.08 per
diluted common share.
“We are pleased with our second quarter performance,” said John A.
Kite, Chairman and CEO.“We substantially completed two
development projects, Holly Springs Towne Center in Raleigh, North
Carolina, and Tamiami Crossing in Naples, Florida.We continued
to expand our 3-R initiative, starting construction on three additional
projects during the quarter.Our leasing efforts remained focused
and aggressive as reflected in our continued improvement in small shop
leasing.Finally, our proactive balance sheet approach further
strengthened our financial flexibility and liquidity position.”
Second Quarter Financial & Portfolio Results
Net loss attributable to common shareholders for the three months ended
June 30, 2016, was $1.9 million compared to a net income of $4.6 million
for the same period in 2015. The decrease is primarily attributable to a
$4.5 million settlement gain in the second quarter of 2015 and
terminated transaction costs of $2.8 million in the second quarter of
2016.
FFO, as adjusted, for the three months ended June 30, 2016, was $44.2
million, or $0.52 per diluted common share, for real estate properties
in which the Company’s operating subsidiaries own an interest (to which
we refer as the “Kite Portfolio”), compared to $41.6 million, or $0.49
per diluted common share, for the same period in the prior year.
Reported FFO, as defined by NAREIT, was $41.4 million, or $0.48 per
diluted common share, for the Kite Portfolio, compared to $45.8 million,
or $0.54 per diluted common share, for the same period in the prior
year. The decrease is primarily attributable to the non-recurring
settlement gain and terminated transaction costs described above.
As of June 30, 2016, the Company owned interests in 121 operating
properties totaling approximately 24 million square feet. The owned
gross leasable area in the Company’s retail operating portfolio was
95.2% leased as of June 30, 2016.
Same-property NOI, which includes 102 retail operating properties,
increased 2.6% for the comparable operating portfolio and 3.6% excluding
the impact of the Company’s 3-R initiative, both percentages compared to
the same period in the prior year.
The Company executed leases on 98 individual spaces during the second
quarter of 2016 totaling 423,346 square feet, including 71 comparable
new and renewal leases for 363,419 owned square feet. The Company
generated positive cash spreads of 19.5% on new comparable leases
executed during the quarter and 6.7% on renewals, for a blended spread
of 9.4%.
Balance Sheet
The Company funded the remaining $100 million on its existing 7-year
term loan facility during the quarter, using the proceeds to repay the
balance on its revolving line of credit. Previously in the quarter, the
Company had repaid $20 million of property level debt related to Mullins
Crossing using the line of credit. Subsequent to quarter end, property
level debt of $26 million related to Pine Ridge and Riverchase was
repaid using the line of credit.
In July, the Company refinanced $700 million in unsecured bank
facilities, including the extensions of $200 million of its $400 million
term loan for an additional five years to mature in 2021 and its $500
million revolving credit facility to mature in 2020. The revolving
credit facility may be extended beyond 2020, for two additional periods
of six months each, at the Operating Partnership's option, subject to
certain conditions. The revised terms of the unsecured financings
improve the borrowing base calculation, lower the Company’s interest
rate and extend the term to maturity.
Redevelopment and Development
The Company’s 3-R initiative, which includes a total of 23 different
projects in various stages, continued to progress during the second
quarter. The Company commenced construction at Hitchcock Plaza (Aiken,
SC), Shops at Moore (Oklahoma City, OK) and Tarpon Bay Plaza (Naples,
FL), during the second quarter. Combined with projects already in
process, the Company now has eight 3-R projects under construction, with
an average targeted incremental return of approximately 9% to 11% and
aggregate estimated costs of $40.5 million to $47 million. Additional
3-R opportunities have been identified at fifteen properties and have an
average targeted incremental return of approximately 9% to 11% and total
estimated costs of approximately $90 million to $110 million.
Two development properties, Holly Springs Towne Center (Phase II)
(Raleigh, NC) and Tamiami Crossing (Naples, FL) were substantially
completed during the second quarter and transitioned into the operating
portfolio. Tamiami Crossing is fully occupied by Ulta, Marshalls,
Michaels, PetSmart, Ross, and Stein Mart. The Company’s remaining
development project, the second phase of Parkside Town Commons (Raleigh,
NC), was 89.2% pre-leased or committed.
Updated Guidance
The Company is updating its guidance for 2016 FFO, as adjusted, to $2.04
to $2.08 from $2.02 to $2.08 per diluted common share. This guidance
excludes certain non-recurring items such as transaction costs, debt
extinguishment gains/losses and certain other income or charges. Please
refer to the full list of guidance assumptions on page 36 of the
Quarterly Financial Supplemental.
| Guidance Range For Full Year 2016 |
| Low |
| High |
|
Consolidated net income per diluted common share
| |
$
|
0.03
| | |
$
|
0.05
|
|
Add: Depreciation, amortization and other
| |
1.97
|
|
|
1.97
|
|
FFO, per diluted common share, as defined by NAREIT
| |
2.00
|
|
|
2.02
|
|
Add: Transaction costs and certain other charges
| |
0.04
|
|
|
0.06
|
| FFO, as adjusted, per diluted common share | |
$
|
2.04
|
|
|
$
|
2.08
|
Earnings Conference Call
The Company will conduct a conference call to discuss its financial
results on Friday, July 29, 2016, at 10:00 a.m. EDT. A live webcast of
the conference call will be available online on the Company’s corporate
website at www.kiterealty.com.
The dial-in numbers are (844) 309-0605 for domestic callers and (574)
990-9933 for international callers (passcode 14937527). In addition, a
webcast replay link will be available on the corporate website.
About Kite Realty Group Trust
Kite Realty Group Trust is a full-service, vertically integrated real
estate investment trust engaged in the ownership, operation, management,
leasing, acquisition, construction, redevelopment and development of
neighborhood and community shopping centers in selected markets in the
United States. As of June 30, 2016, the Company owned interests in a
portfolio of 121 operating, development and redevelopment properties
totaling approximately 24 million total square feet across 20 states.
For more information, please visit the Company’s website at www.kiterealty.com.
Safe Harbor
This press release contains certain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Such statements are based on
assumptions and expectations that may not be realized and are inherently
subject to risks, uncertainties and other factors, many of which cannot
be predicted with accuracy and some of which might not even be
anticipated. Future events and actual results, performance, transactions
or achievements, financial or otherwise, may differ materially from the
results, performance, transactions or achievements, financial or
otherwise, expressed or implied by the forward-looking statements.
Risks, uncertainties and other factors that might cause such
differences, some of which could be material, include, but are not
limited to: national and local economic, business, real estate and other
market conditions, particularly in light of low growth in the U.S.
economy, financing risks, including the availability of and costs
associated with sources of liquidity, the Company’s ability to
refinance, or extend the maturity dates of, its indebtedness, the level
and volatility of interest rates, the financial stability of tenants,
including their ability to pay rent and the risk of tenant bankruptcies,
the competitive environment in which the Company operates, acquisition,
disposition, development, joint venture, property ownership and
management risks, the Company’s ability to maintain its status as a real
estate investment trust for federal income tax purposes, potential
environmental and other liabilities, impairment in the value of real
estate property the Company owns, risks related to the geographical
concentration of our properties in Florida, Indiana and Texas, the
dilutive effects of future offerings of issuing additional securities,
and other factors affecting the real estate industry generally. The
Company refers you to the documents filed by the Company from time to
time with the Securities and Exchange Commission, specifically the
section titled “Risk Factors” in the Company’s Annual Report on Form
10-K for the year ended December 31, 2015, which discuss these and other
factors that could adversely affect the Company’s results. The Company
undertakes no obligation to publicly update or revise these
forward-looking statements, whether as a result of new information,
future events or otherwise.
|
| |
| |
| Kite Realty Group Trust |
| Consolidated Balance Sheets |
| (Unaudited) |
| | | |
|
| ($ in thousands) | | | | |
| | June 30, | | December 31, |
| | 2016 | | 2015 |
| Assets: | | | | |
|
Investment properties, at cost
| |
$
|
3,968,116
| | |
$
|
3,933,140
| |
|
Less: accumulated depreciation
| |
(494,884
|
)
| |
(432,295
|
)
|
| |
3,473,232
| | |
3,500,845
| |
| | | |
|
|
Cash and cash equivalents
| |
37,902
| | |
33,880
| |
|
Tenant and other receivables, including accrued straight-line rent
of $26,981 and $23,809 respectively, net of allowance for
uncollectible accounts
| |
48,702
| | |
51,101
| |
|
Restricted cash and escrow deposits
| |
11,500
| | |
13,476
| |
|
Deferred costs and intangibles, net
| |
137,201
| | |
148,274
| |
|
Prepaid and other assets
| |
8,647
|
| |
8,852
|
|
| Total Assets | |
$
|
3,717,184
|
| |
$
|
3,756,428
|
|
| Liabilities and Shareholders’ Equity: | | | | |
|
Mortgage and other indebtedness, net
| |
$
|
1,740,487
| | |
$
|
1,724,449
| |
|
Accounts payable and accrued expenses
| |
92,142
| | |
81,356
| |
|
Deferred revenue and other liabilities
| |
122,669
|
| |
131,559
|
|
| Total Liabilities | |
1,955,298
| | |
1,937,364
| |
|
Commitments and contingencies
| | | | |
|
Limited Partners’ interests in the Operating Partnership and other
redeemable noncontrolling interests
| |
100,179
| | |
92,315
| |
| Shareholders’ Equity: | | | | |
| Kite Realty Group Trust Shareholders’ Equity: | | | | |
|
Common Shares, $.01 par value, 225,000,000 shares authorized,
83,385,991 and 83,334,865 shares issued and outstanding at June 30,
2016 and December 31, 2015, respectively
| |
834
| | |
833
| |
|
Additional paid in capital
| |
2,043,715
| | |
2,050,545
| |
|
Accumulated other comprehensive loss
| |
(11,850
|
)
| |
(2,145
|
)
|
|
Accumulated deficit
| |
(371,690
|
)
| |
(323,257
|
)
|
| Total Kite Realty Group Trust Shareholders’ Equity | |
1,661,009
| | |
1,725,976
| |
|
Noncontrolling Interests
| |
698
|
| |
773
|
|
| Total Equity | |
1,661,707
|
| |
1,726,749
|
|
| Total Liabilities and Shareholders' Equity | |
$
|
3,717,184
|
| |
$
|
3,756,428
|
|
| | | | | | | |
|
|
| |
| |
| |
| |
| Kite Realty Group Trust |
| Consolidated Statements of Operations |
| For the Three and Six Months Ended June 30, 2016 and 2015 |
| (Unaudited) |
| | | | | | | |
|
| ($ in thousands, except per share data) | | | | | | | | |
| | Three Months Ended | | Six Months Ended |
| | June 30, | | June 30, |
| | 2016 | | 2015 | | 2016 | | 2015 |
| Revenue: | | | | | | | | |
|
Minimum rent
| |
$
|
68,455
| | |
$
|
64,897
| | |
$
|
135,918
| | |
$
|
130,377
| |
|
Tenant reimbursements
| |
17,006
| | |
16,489
| | |
35,161
| | |
35,104
| |
|
Other property related revenue
| |
2,114
|
| |
2,349
|
| |
5,046
|
| |
5,083
|
|
| Total revenue | |
87,575
| | |
83,735
| | |
176,125
| | |
170,564
| |
| Expenses: | | | | | | | | |
|
Property operating
| |
11,346
| | |
11,801
| | |
23,538
| | |
24,525
| |
|
Real estate taxes
| |
10,503
| | |
9,755
| | |
21,637
| | |
19,777
| |
|
General, administrative, and other
| |
4,856
| | |
4,566
| | |
10,147
| | |
9,572
| |
|
Transaction costs
| |
2,771
| | |
302
| | |
2,771
| | |
461
| |
|
Depreciation and amortization
| |
43,841
|
| |
41,212
|
| |
86,082
|
| |
81,648
|
|
| Total expenses | |
73,317
|
| |
67,636
|
| |
144,175
|
| |
135,983
|
|
| Operating income | |
14,258
| | |
16,099
| | |
31,950
| | |
34,581
| |
|
Interest expense
| |
(15,500
|
)
| |
(13,181
|
)
| |
(30,825
|
)
| |
(27,114
|
)
|
|
Income tax expense of taxable REIT subsidiary
| |
(338
|
)
| |
(69
|
)
| |
(748
|
)
| |
(124
|
)
|
|
Gain on settlement
| |
—
| | |
4,520
| | |
—
| | |
4,520
| |
|
Other expense, net
| |
(110
|
)
| |
(134
|
)
| |
(94
|
)
| |
(130
|
)
|
| (Loss) income from continuing operations | |
(1,690
|
)
| |
7,235
| | |
283
| | |
11,733
| |
|
Gain on sales of operating properties
| |
194
|
| |
—
|
| |
194
|
| |
3,363
|
|
| Net (loss) income | |
(1,496
|
)
| |
7,235
| | |
477
| | |
15,096
| |
|
Net income attributable to noncontrolling interest
| |
(399
|
)
| |
(508
|
)
| |
(971
|
)
| |
(1,191
|
)
|
|
Dividends on preferred shares
| |
—
|
| |
(2,114
|
)
| |
—
|
| |
(4,228
|
)
|
| Net (loss) income attributable to Kite Realty Group Trust common
shareholders | |
$
|
(1,895
|
)
| |
$
|
4,613
|
| |
$
|
(494
|
)
| |
$
|
9,677
|
|
| | | | | | | |
|
| (Loss) income per common share - basic and diluted | |
$
|
(0.02
|
)
| |
$
|
0.06
|
| |
$
|
(0.01
|
)
| |
$
|
0.12
|
|
| | | | | | | |
|
|
Weighted average common shares outstanding - basic
| |
83,375,765
|
| |
83,506,078
|
| |
83,362,136
|
| |
83,519,013
|
|
|
Weighted average common shares outstanding - diluted
| |
83,375,765
|
| |
83,803,879
|
| |
83,362,136
|
| |
83,818,890
|
|
| Common dividends declared per common share | |
$
|
0.2875
|
| |
$
|
0.2725
|
| |
$
|
0.5750
|
| |
$
|
0.5450
|
|
| | | | | | | | | | | | | | | |
|
|
| |
| |
| |
| |
| Kite Realty Group Trust |
| Funds From Operations |
| For the Three and Six Months Ended June 30, 2016 and 2015 |
| (Unaudited) |
| | | | | | | |
|
| ($ in thousands, except per share data) | | | | | | | | |
| | Three Months Ended | | Six Months Ended |
| | June 30, | | June 30, |
| | 2016 | | 2015 | | 2016 | | 2015 |
| Funds From Operations | | | | | | | | |
|
Consolidated net (loss) income
| |
$
|
(1,496
|
)
| |
$
|
7,235
| | |
$
|
477
| | |
$
|
15,096
| |
|
Less: cash dividends on preferred shares
| |
—
| | |
(2,114
|
)
| |
—
| | |
(4,228
|
)
|
|
Less: net income attributable to noncontrolling interests in
properties
| |
(461
|
)
| |
(414
|
)
| |
(922
|
)
| |
(1,001
|
)
|
|
Less: gains on sales of operating properties
| |
(194
|
)
| |
—
| | |
(194
|
)
| |
(3,363
|
)
|
|
Add: depreciation and amortization of consolidated entities, net of
noncontrolling interests
| |
43,545
|
| |
41,132
|
| |
85,599
|
| |
81,425
|
|
|
Funds From Operations of the Kite Portfolio1 | |
41,394
| | |
45,839
| | |
84,960
| | |
87,929
| |
|
Less: Limited Partners' interests in Funds From Operations
| |
(809
|
)
| |
(924
|
)
| |
(1,790
|
)
| |
(1,731
|
)
|
|
Funds From Operations attributable to Kite Realty Group Trust common
shareholders
| |
$
|
40,585
|
| |
$
|
44,915
|
| |
$
|
83,170
|
| |
$
|
86,198
|
|
|
FFO per share of the Operating Partnership - basic
| |
$
|
0.49
|
| |
$
|
0.54
|
| |
$
|
1.00
|
| |
$
|
1.03
|
|
|
FFO per share of the Operating Partnership - diluted
| |
$
|
0.48
|
| |
$
|
0.54
|
| |
$
|
0.99
|
| |
$
|
1.03
|
|
| | | | | | | |
|
|
Funds From Operations of the Kite Portfolio1 | |
$
|
41,394
| | |
$
|
45,839
| | |
$
|
84,960
| | |
$
|
87,929
| |
|
Less: gain on settlement
| |
—
| | |
(4,520
|
)
| |
—
| | |
(4,520
|
)
|
|
Add: transaction costs
| |
2,771
| | |
302
| | |
2,771
| | |
461
| |
|
Add: severance charge
| |
—
|
| |
—
|
| |
500
|
| |
—
|
|
|
Funds From Operations of the Kite Portfolio, as adjusted
| |
$
|
44,165
|
| |
$
|
41,621
|
| |
$
|
88,231
|
| |
$
|
83,870
|
|
|
FFO per share of the Operating Partnership, as adjusted - basic
| |
$
|
0.52
|
| |
$
|
0.49
|
| |
$
|
1.03
|
| |
$
|
0.98
|
|
|
FFO per share of the Operating Partnership, as adjusted - diluted
| |
$
|
0.52
|
| |
$
|
0.49
|
| |
$
|
1.03
|
| |
$
|
0.98
|
|
| | | | | | | |
|
|
Weighted average Common Shares outstanding - basic
| |
83,375,765
|
| |
83,506,078
|
| |
83,362,136
|
| |
83,519,013
|
|
|
Weighted average Common Shares outstanding - diluted
| |
83,475,474
|
| |
83,803,879
|
| |
83,460,521
|
| |
83,818,890
|
|
|
Weighted average Common Shares and Units outstanding - basic
| |
85,320,923
|
| |
85,231,284
|
| |
85,295,968
|
| |
85,202,110
|
|
|
Weighted average Common Shares and Units outstanding - diluted
| |
85,420,633
|
| |
85,529,084
|
| |
85,394,353
|
| |
85,501,987
|
|
| | | | | | | |
|
| | | | | | | |
|
| Funds From Operations per share | | | | | | | | |
|
Consolidated net (loss) income
| |
$
|
(0.02
|
)
| |
$
|
0.08
| | |
$
|
0.01
| | |
$
|
0.18
| |
|
Less: cash dividends on preferred shares
| |
—
| | |
(0.02
|
)
| |
—
| | |
(0.05
|
)
|
|
Less: net income attributable to noncontrolling interests in
properties
| |
(0.01
|
)
| |
—
| | |
(0.01
|
)
| |
(0.01
|
)
|
|
Less: gains on sales of operating properties
| |
—
| | |
—
| | |
—
| | |
(0.04
|
)
|
|
Add: depreciation and amortization of consolidated entities, net of
noncontrolling interests
| |
0.51
|
| |
0.48
|
| |
1.00
|
| |
0.95
|
|
|
Funds From Operations of the Kite Portfolio per share1 | |
$
|
0.48
|
| |
$
|
0.54
|
| |
$
|
1.00
|
| |
$
|
1.03
|
|
| | | | | | | |
|
|
Funds From Operations of the Kite Portfolio per share1 | |
$
|
0.48
| | |
$
|
0.54
| | |
$
|
1.00
| | |
$
|
1.03
| |
|
Less: gain on settlement
| |
—
| | |
(0.05
|
)
| |
—
| | |
(0.05
|
)
|
|
Add: transaction costs
| |
0.04
| | |
—
| | |
0.03
| | |
—
| |
|
Add: severance charge
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Funds From Operations of the Kite Portfolio per share, as adjusted
| |
$
|
0.52
|
| |
$
|
0.49
|
| |
$
|
1.03
|
| |
$
|
0.98
|
|
| | | | | | | | | | | | | | | |
|
|
____________________
|
|
1
|
|
“Funds From Operations of the Kite Portfolio" measures 100% of the
operating performance of the Operating Partnership’s real estate
properties and construction and service subsidiaries in which the
Company owns an interest. “Funds From Operations attributable to
Kite Realty Group Trust common shareholders” reflects a reduction
for the redeemable noncontrolling weighted average diluted interest
in the Operating Partnership.
|
Funds from Operations (FFO) is a widely used performance measure for
real estate companies and is provided here as a supplemental measure of
operating performance. We calculate FFO in accordance with the best
practices described in the April 2002 National Policy Bulletin of the
National Association of Real Estate Investment Trusts (NAREIT), which we
refer to as the White Paper. The White Paper defines FFO as net income
(determined in accordance with generally accepted accounting principles
(GAAP)), excluding gains (or losses) from sales and impairments of
depreciated property, plus depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures.
Considering the nature of our business as a real estate owner and
operator, we believe that FFO is helpful to investors in measuring our
operational performance because it excludes various items included in
net income that do not relate to or are not indicative of our operating
performance, such as gains or losses from sales of depreciated property
and depreciation and amortization, which can make periodic and peer
analyses of operating performance more difficult. For informational
purposes, we have also provided FFO adjusted for a severance charge in
2016, transaction costs in 2016 and 2015 and a gain on settlement in
2015. We believe this supplemental information provides a meaningful
measure of our operating performance. We believe our presentation of
FFO, as adjusted, provides investors with another financial measure that
may facilitate comparison of operating performance between periods and
among our peer companies. FFO should not be considered as an alternative
to net income (determined in accordance with GAAP) as an indicator of
our financial performance, is not an alternative to cash flow from
operating activities (determined in accordance with GAAP) as a measure
of our liquidity, and is not indicative of funds available to satisfy
our cash needs, including our ability to make distributions. Our
computation of FFO may not be comparable to FFO reported by other REITs
that do not define the term in accordance with the current NAREIT
definition or that interpret the current NAREIT definition differently
than we do.
|
| |
| |
| |
| |
| |
| |
| Kite Realty Group Trust |
| Same Property Net Operating Income |
| For the Three and Six Months Ended June 30, 2016 and 2015 |
| (Unaudited) |
| | | | | | | | | | | |
|
| ($ in thousands) | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2016 | | 2015 | | %
Change | | 2016 | | 2015 | | %
Change |
|
Number of properties for the quarter1 | |
102
| |
102
| | | | | | | | |
| | | | | | | | | | | |
|
| Leased percentage | |
95.3
|
%
| |
95.4
|
%
| | | |
95.3
|
%
| |
95.4
|
%
| | |
| Economic Occupancy percentage2 | |
94.0
|
%
| |
93.8
|
%
| | | |
94.0
|
%
| |
93.8
|
%
| | |
| | | | | | | | | | | |
|
|
Minimum rent
| |
$
|
54,827
| | |
$
|
53,982
| | | | |
$
|
109,178
| | |
$
|
107,327
| | | |
|
Tenant recoveries
| |
14,557
| | |
14,488
| | | | |
29,892
| | |
30,107
| | | |
|
Other income
| |
238
|
| |
295
|
| | | |
563
|
| |
569
|
| | |
| |
69,622
| | |
68,765
| | | | |
139,633
| | |
138,003
| | | |
| | | | | | | | | | | |
|
|
Property operating expenses
| |
(8,245
|
)
| |
(9,006
|
)
| | | |
(16,763
|
)
| |
(18,821
|
)
| | |
|
Real estate taxes
| |
(8,917
|
)
| |
(8,613
|
)
| | | |
(18,186
|
)
| |
(17,534
|
)
| | |
| |
(17,162
|
)
| |
(17,619
|
)
| | | |
(34,949
|
)
| |
(36,355
|
)
| | |
| Net operating income - same properties3 | | $ | 52,460 |
| | $ | 51,146 |
| | 2.6 | % | | $ | 104,684 |
| | $ | 101,648 |
| | 3.0 | % |
| Net operating income - same properties excluding the impact of
the 3-R initiative5 | | | | | | 3.6 | % | | | | | | |
| | | | | | | | | | | |
|
| Reconciliation of Same Property NOI to Most Directly Comparable
GAAP Measure: | | | | | | | | | | | | |
|
Net operating income - same properties
| |
$
|
52,460
| | |
$
|
51,146
| | | | |
$
|
104,684
| | |
$
|
101,648
| | | |
|
Net operating income - non-same activity4 | |
13,266
| | |
11,033
| | | | |
26,266
| | |
24,614
| | | |
|
Other expense, net
| |
(448
|
)
| |
(203
|
)
| | | |
(842
|
)
| |
(254
|
)
| | |
|
General, administrative and other
| |
(4,856
|
)
| |
(4,566
|
)
| | | |
(10,147
|
)
| |
(9,572
|
)
| | |
|
Transaction costs
| |
(2,771
|
)
| |
(302
|
)
| | | |
(2,771
|
)
| |
(461
|
)
| | |
|
Depreciation expense
| |
(43,841
|
)
| |
(41,212
|
)
| | | |
(86,082
|
)
| |
(81,648
|
)
| | |
|
Interest expense
| |
(15,500
|
)
| |
(13,181
|
)
| | | |
(30,825
|
)
| |
(27,114
|
)
| | |
|
Gain on settlement
| |
—
| | |
4,520
| | | | |
—
| | |
4,520
| | | |
|
Gains on sales of operating properties
| |
194
| | |
—
| | | | |
194
| | |
3,363
| | | |
|
Net income attributable to noncontrolling interests
| |
(399
|
)
| |
(508
|
)
| | | |
(971
|
)
| |
(1,191
|
)
| | |
|
Dividends on preferred shares
| |
—
|
| |
(2,114
|
)
| | | |
—
|
| |
(4,228
|
)
| | |
|
Net income attributable to common shareholders
| |
$
|
(1,895
|
)
| |
$
|
4,613
|
| | | |
$
|
(494
|
)
| |
$
|
9,677
|
| | |
| | | | | | | | | | | | | | | | | | | |
|
|
____________________
|
|
1
|
|
Same property analysis excludes operating properties in
redevelopment as well as office properties (Thirty South Meridian
and Eddy Street Commons).
|
|
2
| |
Excludes leases that are signed but for which tenants have not yet
commenced the payment of cash rent. Calculated as a weighted average
based on the timing of cash rent commencement during the period.
|
|
3
| |
Same property net operating income excludes net gains from outlot
sales, straight-line rent revenue, bad debt expense and recoveries,
lease termination fees, amortization of lease intangibles and
significant prior year expense recoveries and adjustments, if any.
|
|
4
| |
Includes non-cash accounting items across the portfolio as well as
net operating income from properties not included in the same
property pool.
|
|
5
| |
See Quarterly Financial Supplemental for further detail of the
properties included in the 3-R initiative.
|
The Company believes that Net Operating Income ("NOI") is helpful to
investors as a measure of its operating performance because it excludes
various items included in net income that do not relate to or are not
indicative of its operating performance, such as depreciation and
amortization, interest expense, and impairment, if any. The Company
believes that Same Property NOI is helpful to investors as a measure of
its operating performance because it includes only the NOI of properties
that have been owned for the full period presented, which eliminates
disparities in net income due to the redevelopment, acquisition or
disposition of properties during the particular period presented and
thus provides a more consistent metric for the comparison of the
Company's properties. NOI and Same Property NOI should not, however, be
considered as alternatives to net income (calculated in accordance with
GAAP) as indicators of the Company's financial performance. The
Company’s computation of Same Property NOI may differ from the
methodology for calculating Same Property NOI used by other REITs, and
therefore, may not be comparable to such other REITs.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160728006328/en/
Kite Realty Group Trust
Maggie Daniels, CFA, 317-713-7644
Investor
Relations and Strategy
mdaniels@kiterealty.com
Source: Kite Realty Group Trust