INDUS Realty Trust, Inc. (Nasdaq: INDT) (“INDUS” or the
“Company”), a U.S. based industrial/logistics REIT, today
reported financial results for the three months ended June 30, 2021
(the “2021 second quarter”).
2021 Second Quarter & Recent Highlights
- Net loss of $1.2 million for the
2021 second quarter compared to a net loss of $0.7 million for the
three months ended June 30, 2020 (the “2020 second quarter”)
- Net Operating Income (“NOI”)1 of
$7.3 million for the 2021 second quarter as compared to $6.8
million for the 2020 second quarter
- Cash NOI2 for industrial/logistics
properties of $6.1 million for the 2021 second quarter as compared
to $5.4 million for the 2020 second quarter
- Industrial/logistics portfolio was
95.3% leased; stabilized3 industrial/logistics portfolio was 99.4%
leased
- Acquired two industrial/logistics
buildings, one in Charlotte, North Carolina (395,000 square feet)
and one in the Lehigh Valley of Pennsylvania (127,500 square feet),
for a combined purchase price of $53.7 million; subsequent to
quarter end, acquired an industrial/logistics building in Lakeland,
Florida (139,500 square feet) for $17.8 million
- Acquired approximately 14 acres of
undeveloped land in Orlando, Florida for $5.25 million, upon which
the Company plans to construct two industrial/logistics buildings
totaling approximately 195,000 square feet
- Entered into an agreement to sell
approximately 670 acres of land in Granby and East Granby,
Connecticut that comprise the Connecticut Nursery Farm, for
anticipated proceeds of $10.3 million, if consummated
- Subsequent to quarter end, entered into an agreement for a new
secured revolving credit facility of up to $100 million to replace
the Company’s former revolving credit facility and acquisition
facility
- Subsequent to quarter end, entered into an agreement to
acquire, for a purchase price of $31.5 million, an
under-construction, approximately 184,000 square foot
industrial/logistics portfolio in Nashville, Tennessee
- Subsequent to quarter end, entered into an agreement to
acquire, for a purchase price of $2.25 million, approximately 10.6
acres of undeveloped land in the Lehigh Valley, upon which INDUS
intends to construct, on speculation, an approximately 90,000
square foot industrial/logistics building
2021 Second Quarter Results of Operations
INDUS reported total rental revenue of
approximately $9.8 million for the 2021 second quarter, as compared
to approximately $9.3 million for the 2020 second quarter. The
approximately $0.5 million increase in rental revenue was
principally due to new leases of first generation space and second
generation leases in the 2021 second quarter that were either not
in place or were in place for only a portion of the 2020 second
quarter.
Net Operating Income (“NOI”), which is defined
as rental revenue less operating expenses of rental properties and
real estate taxes, increased to approximately $7.3 million in the
2021 second quarter, from approximately $6.8 million in the 2020
second quarter. Net Operating Income on a cash basis (“Cash NOI”)
for the 2021 second quarter was approximately $6.8 million, as
compared to approximately $6.2 million for the comparable prior
year period. The $0.5 million increase in NOI and the $0.6 million
increase in Cash NOI both principally reflected the increase in
rental revenue as described above.
NOI and Cash NOI for INDUS’s
industrial/logistics properties and total portfolio were as
follows:
($ in 000s) |
For the Three Months Ended |
|
For the Six Months Ended |
|
June 30, 2021 |
|
June 30, 2020 |
|
Increase |
|
June 30, 2021 |
|
June 30, 2020 |
|
Increase |
Industrial/logistics portfolio: |
|
|
|
|
|
|
|
|
|
|
NOI |
$ |
6,458 |
|
$ |
5,884 |
|
9.8 |
% |
|
$ |
12,787 |
|
$ |
11,415 |
|
12.0 |
% |
Cash NOI |
$ |
6,055 |
|
$ |
5,398 |
|
12.2 |
% |
|
$ |
11,988 |
|
$ |
10,620 |
|
12.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Total
portfolio: |
|
|
|
|
|
|
|
|
|
|
NOI |
$ |
7,250 |
|
$ |
6,774 |
|
7.0 |
% |
|
$ |
14,257 |
|
$ |
13,083 |
|
9.0 |
% |
Cash NOI |
$ |
6,831 |
|
$ |
6,188 |
|
10.4 |
% |
|
$ |
13,401 |
|
$ |
11,965 |
|
12.0 |
% |
General and administrative expenses increased to
approximately $2.7 million in the 2021 second quarter from
approximately $2.4 million in the 2020 second quarter,
principally reflecting increases of employee compensation expenses,
one-time maintenance expense for the removal of barns on
undeveloped land and all other general and administrative expenses,
partially offset by an approximate $0.2 million expense decrease
related to INDUS’s non-qualified deferred compensation plan.
INDUS incurred a net loss of approximately
$1.2 million in the 2021 second quarter, as compared to a net
loss of approximately $0.7 million for the 2020 second
quarter. In addition to the higher general and administrative
expenses as described above, the largest factor contributing to the
higher net loss was a loss in the 2021 second quarter of
approximately $1.0 million from the change in the fair value of
financial instruments that were issued on August 24, 2020.
Leasing ActivityDuring the 2021
second quarter, INDUS executed one industrial/logistics lease
totaling approximately 4,800 square feet at its recently renovated
property located at 170 Sunport Lane ("170 Sunport") in the Orlando
market. As of June 30, 2021, approximately 27,000 square feet at
170 Sunport remains vacant. In addition to this vacancy, INDUS has
approximately 197,500 square feet of vacancy that was added to its
industrial/logistics portfolio through the Company’s newest
value-add acquisition in the Charlotte market completed in June
2021.
As of June 30, 2021, INDUS’s thirty-two
industrial/logistics buildings aggregated approximately 4,729,000
square feet and represented 92.5% of INDUS’s total real estate
portfolio. As a result of the activity described above, INDUS’s
in-service industrial/logistics portfolio’s percentage leased was
as follows:
|
June 30,2021 |
Mar. 31,2021 |
Dec. 31,2020 |
Aug. 31, 2020 |
Percentage Leased |
95.3 |
% |
99.2 |
% |
94.5 |
% |
94.3 |
% |
Percentage Leased – Stabilized Properties |
99.4 |
% |
99.2 |
% |
95.7 |
% |
99.7 |
% |
In the 2021 second quarter, INDUS completed two
lease extensions of office/flex space that resulted in a net
expansion of approximately 11,000 square feet under lease which was
offset by a previous tenant vacating 11,000 square feet. INDUS’s
ten office/flex buildings, which aggregate approximately 385,000
square feet and comprise 7.5% of INDUS’s total real estate
portfolio, were 70.8% leased as of June 30, 2021, as compared to
eleven office/flex buildings at 71.3% leased on March 31, 2021.
Acquisition & Development
PipelineOn April 13, 2021, INDUS purchased an
approximately 14 acre parcel of undeveloped land in Orlando,
Florida (the “Jetport Land”) for a purchase price of $5.25 million,
before transaction costs. INDUS plans to construct two
industrial/logistics buildings totaling approximately 195,000
square feet on the Jetport Land.
On May 12, 2021, INDUS purchased a 127,500
square foot industrial/logistics building on approximately 13.7
acres of land in the Lehigh Valley of Pennsylvania for a purchase
price of $11.7 million, before transaction costs (the “Lehigh
Valley Acquisition”). The Lehigh Valley Acquisition is fully leased
through November 2022 to a single tenant and has a 4.5% in-place
cash capitalization rate (first full year Cash NOI/purchase price).
The Lehigh Valley Acquisition increased the Company’s Lehigh Valley
industrial/logistics portfolio to seven buildings totaling
approximately 1.4 million square feet, not including properties in
the Company’s development pipeline.
On June 28, 2021, INDUS purchased a recently
constructed, 50.1% leased, approximately 395,000 square foot
industrial/logistics building in Charlotte, North Carolina for a
purchase price of $42.0 million, before transaction costs (the
“Charlotte Acquisition”). The Company has estimated an underwritten
stabilized yield of 4.5% on the property. The Charlotte Acquisition
increased the Company’s Charlotte industrial/logistics portfolio to
four buildings totaling approximately 1.0 million square feet, not
including the approximately 141,000 square foot build-to-suit
warehouse currently under construction that is expected to be
completed by September 30, 2021 (the “Charlotte
Build-to-Suit”).
Subsequent to June 30, 2021, INDUS completed the
following activities:
- Closed on the purchase of a 139,500
square foot, fully leased industrial/logistics building in
Lakeland, Florida for a purchase price of $17.8 million, before
transaction costs (the “Lakeland Acquisition”), which equates to an
in-place capitalization rate of approximately 4.0%. The Lakeland
Acquisition increased the Company’s Central Florida
industrial/logistics portfolio to four buildings totaling
approximately 416,000 square feet, not including properties in the
company’s development pipeline.
- Entered into an agreement (the
“Forward Purchase Agreement”) to acquire, for a purchase price of
$31.5 million, an under-construction, approximately 184,000 square
foot industrial/logistics portfolio in Nashville, Tennessee (the
“Nashville Acquisition”). The Nashville Acquisition is being
developed on speculation by the seller and, upon completion, will
be comprised of two buildings located in close proximity to
downtown Nashville. Under the terms of the Forward Purchase
Agreement, INDUS expects to close on the Nashville Acquisition by
the end of fiscal 2021 (see press release issued today titled
“INDUS Announces Agreement to Acquire a Two-Building
Industrial/Logistics Portfolio”).
- Entered into an agreement (the
“Purchase Agreement”) to acquire, for a purchase price of $2.25
million, approximately 10.6 acres of undeveloped land in the Lehigh
Valley of Pennsylvania (the “Lehigh Valley Land”). Under the terms
of the Purchase Agreement, INDUS expects to close on the Lehigh
Valley Land upon receipt of the requisite entitlements, estimated
to be during the first half of fiscal 2022. Subsequent to closing
on the Lehigh Valley Land, INDUS expects to begin construction, on
speculation, of an approximately 90,000 square foot
industrial/logistics building (see press release issued today
titled “INDUS Announces Agreement to Acquire Land for
Development”).
Closings on the purchases of the Nashville
Acquisition and the Lehigh Valley Land are each subject to a number
of contingencies including the satisfactory completion of due
diligence by INDUS. There can be no guarantee that the Nashville
Acquisition or the acquisition and the development of the Lehigh
Valley Land will be completed under current terms, anticipated
timelines, or at all.
The following is a summary of INDUS’s
development pipeline for its industrial/logistics portfolio as of
August 6, 2021:
Project |
Market |
Building Size (SF) |
Type |
Estimated Completion |
Owned Land |
|
|
|
|
Charlotte Build-to-Suit |
Charlotte, NC |
141,000 |
Build-to-Suit |
Q3 2021 |
Chapmans Road |
Lehigh Valley, PA |
103,000 |
Speculative |
Q4 2021 |
110 Tradeport Drive |
Hartford, CT |
234,000 |
67% Pre-leased |
Q2 2022 |
Jetport (Landstar Blvd.) |
Orlando, FL |
195,000 |
Speculative |
Q3 2022 |
|
|
|
|
|
Land Under Purchase & Sale Agreement |
First & Second Allentown Purchase Agreements |
Lehigh Valley, PA |
206,000 |
Speculative |
Q4 2022 |
Lehigh Valley Land |
Lehigh Valley, PA |
90,000 |
Speculative |
Q2 2023 |
Total |
|
969,000 |
|
|
INDUS expects that the total development and
stabilization costs of developments in its pipeline will total
approximately $131.5 million, of which approximately $35.7 million
has been expended through June 30, 2021. The Company has
underwritten a weighted average stabilized Cash NOI yield between
5.8% - 6.3%4 on its development pipeline. Actual initial full year
stabilized Cash NOI yields may vary from INDUS’s underwritten
stabilized Cash NOI yield ranges based on the actual total cost to
complete a project or acquire a property and its actual initial
full year stabilized Cash NOI.
DispositionsDuring the 2021
second quarter, INDUS completed the sale of its approximately 7,200
square foot restaurant building in the Hartford market (previously
included in the office/flex portfolio) to the tenant of the
building for approximately $0.6 million, in addition to the sale of
two small parcels of undeveloped land in separate transactions.
Also during the 2021 second quarter, INDUS
entered into agreements to sell a number of non-core properties and
undeveloped land, including:
- On April 29, 2021, INDUS entered
into an agreement (the “Blue Hills Sale Agreement”) to sell an
approximately 165,000 square foot industrial/logistics building
(“1985 Blue Hills”) and two adjacent parcels of undeveloped land
aggregating approximately 39 acres in the Hartford market for a
purchase price of $18.0 million. Under the terms of the Blue Hills
Sale Agreement, closing shall be no later than December 15, 2021.
1985 Blue Hills had a mortgage balance of approximately $5.0
million as of June 30, 2021, which INDUS intends to repay with
proceeds from this sale.
- On June 1, 2021, INDUS entered into
an agreement (the “CT Nursery Farm Sale Agreement”) to sell
approximately 670 acres of land in Granby and East Granby,
Connecticut that comprise the Connecticut Nursery Farm for proceeds
of $10.3 million. The Connecticut Nursery Farm is currently under a
lease, to a nursery operator, that is scheduled to expire on
December 31, 2023. Under the terms of the CT Nursery Farm Sale
Agreement, INDUS expects to close on the disposition of the
Connecticut Nursery Farm by the end of the 2021 fourth
quarter.
In summary, as of August 6, 2021, INDUS has
agreements to sell the following non-core building and undeveloped
land parcels:
($ in millions)Name |
Type |
Location |
Property Size |
Estimated Closing |
Sale Price |
1975, 1985 & 1995 Blue Hills Ave |
Industrial + Land |
Windsor, CT |
165,000 SF and 39 acres |
Q4 2021 |
$18.0 |
Subtotal Gross Proceeds of Property Dispositions Under
Agreement, if Consummated |
|
$18.0 |
|
|
|
|
|
|
Florida Nursery Farm |
Land |
Quincy, FL |
1,066 acres |
Q3 2021 |
$1.1 |
Stratton Farms Residential Parcels5 |
Land |
Suffield, CT |
6 acres (7 lots) |
Q3 2021 |
$0.4 |
Connecticut Nursery Farm |
Land |
E. Granby/Granby, CT |
670 acres |
Q4 2021 |
$10.3 |
Meadowood Residential Parcels |
Land |
Simsbury, CT |
277 acres |
Q4 2021 |
$5.4 |
East Granby / Windsor Parcels |
Land |
E. Granby / Windsor, CT |
280 acres |
2022 |
$6.0 |
Total Gross Proceeds of Land & Property Dispositions
Under Agreement, if Consummated |
|
$41.2 |
During the 2021 second quarter, INDUS entered
into an agreement to sell three office/flex properties totaling
approximately 210,000 square feet along with an adjacent 8 acre
parcel of land for $6.6 million. Subsequent to quarter end, the
prospective buyer terminated the agreement. The Company expects to
continue to seek a buyer for all or a portion of these
properties.
The completion of the sales contemplated under
these agreements is subject to satisfactory completion of due
diligence by the buyers, among other contingencies. There can be no
guarantee that the transactions contemplated will be completed
under their current terms, or at all.
Liquidity & Capital
ResourcesAs of June 30, 2021, the Company had $66.2
million of cash and no borrowings under the Company’s revolving
credit facilities with Webster Bank, N.A. (the “Former Credit
Facilities”). Subsequent to quarter end, on August 5, 2021, the
Company’s Operating Partnership (see below), and the Company, as
parent guarantor, entered into an agreement for a new secured
revolving credit facility of up to $100 million (the “New
Credit Facility”) that replaced its Former Credit Facilities.
JPMorgan Chase Bank, N.A. (“JPMorgan”) and Citibank, N.A.
(“Citibank”) were the Joint Lead Arrangers and Joint Book Runners,
with JPMorgan as Administrative Agent, and Citibank as Syndication
Agent. BMO Harris Bank, N.A., KeyBank National Association and
Morgan Stanley Senior Funding, Inc. also participated in the New
Credit Facility.
The New Credit Facility has a three-year term
with two one-year extensions at the Company’s option. The New
Credit Facility also includes an uncommitted incremental facility,
which would enable the New Credit Facility to be increased up to
$250 million in the aggregate. Borrowings under the New Credit
Facility will bear interest subject to a pricing grid for changes
in the Company’s total leverage. Based on the Company’s current
leverage, the initial annual interest rate under the New Credit
Facility is one-month LIBOR plus 1.20% compared to a rate of
one-month LIBOR plus 2.50% and one-month LIBOR plus 2.75% under its
former revolving credit line and acquisition credit line,
respectively, immediately prior to entering into the New Credit
Facility.
On May 7, 2021, a subsidiary of INDUS entered
into a construction loan agreement (the “2021 JPM Construction
Loan”) with JPMorgan to provide a portion of the funds for the
development costs of the Charlotte Build-to-Suit. Total borrowings
under the JPM Construction Loan will be the lesser of $28.4 million
or 67.5% of the total project cost (as defined) of the Charlotte
Build-to-Suit. The term of the 2021 JPM Construction Loan is two
years, with a one-year extension at the Company’s option. Interest
under the 2021 JPM Construction Loan, to be adjusted monthly, is
one-month LIBOR plus 1.65%, reduced to one-month LIBOR plus 1.40%
upon completion of the Charlotte Build-to-Suit and commencement of
rental payments by Amazon. As of June 30, 2021, there were no
borrowings outstanding under the 2021 JPM Construction Loan.
Through August 6, 2021, approximately $9.6 million was drawn
on the 2021 JPM Construction Loan.
On June 28, 2021, INDUS Realty Trust, LLC, a
Maryland LLC and a wholly-owned subsidiary of the Company, was
converted into a Maryland limited partnership and the entity’s name
was changed from INDUS Realty Trust, LLC to INDUS RT, LP (the
“Operating Partnership”). The Operating Partnership is 99% owned by
the Company as the general partner, and 1% owned by INDUS RT, LLC
as limited partner, a Maryland limited partnership, which is 100%
owned by the Company. The Operating Partnership structure provides
additional capital flexibility for INDUS, as it will allow the
Company to offer shares in its Operating Partnership (“OP Units”)
to sellers of real estate assets in exchange for ownership of those
assets. Sellers may hold OP Units pursuant to their own tax
deferral strategies or may convert the OP Units into shares of the
Company’s common stock, subject to certain conditions.
Subsequent to quarter end, on July 9, 2021,
INDUS and its Operating Partnership filed an updated universal
shelf registration statement on Form S-3 (the “Universal Shelf”)
with the Securities and Exchange Commission. Under the Universal
Shelf, INDUS or its Operating Partnership may offer and sell up to
$500 million of a variety of securities during the three year
period that will commence upon the effective date of the Universal
Shelf, which has not yet occurred.
Second Quarter Earnings Conference Call,
Earnings Supplement and Investor PresentationINDUS is
hosting a live earnings conference call that will take place
tomorrow, August 10, 2021, at 11:00 am Eastern Time, to discuss its
2021 second quarter financial and operating results and to provide
a business update. Supplemental materials containing additional
financial and operating information will be available on INDUS’s
website at the start of the call. All investors and other
interested parties are invited to either dial in to the call (to
participate in live Q&A) or log in to a listen-only webcast
which, together with the supplemental information, can be accessed
via the Investors section of INDUS’s website at
www.indusrt.com/investors or by calling the following numbers:
PARTICIPANT DIAL IN (TOLL FREE):
1-866-777-2509PARTICIPANT INTERNATIONAL DIAL IN: 1-412-317-5413
An archived recording of the webcast will be
available for three months under the Investors section of INDUS’s
website at www.indusrt.com.
About INDUS
INDUS is a real estate business principally
engaged in developing, acquiring, managing and leasing
industrial/logistics properties. INDUS owns 43 buildings totaling
approximately 5.3 million square feet (including 33
industrial/logistics buildings aggregating approximately 4.9
million square feet) in Connecticut, Pennsylvania, North Carolina
and Florida in addition to over 3,400 acres of undeveloped
land.
Forward-Looking Statements:
This Press Release includes “forward-looking
statements” within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. These forward-looking statements include
INDUS’s beliefs and expectations regarding future events or
conditions including, without limitation, statements regarding
INDUS’s intention to elect to be taxed as a REIT, the completion of
acquisitions and dispositions under agreements, any sales of
securities under the Universal Shelf, construction and development
plans and timelines, the estimated underwritten stabilized Cash NOI
of its developments and Cash NOI yield estimates, expected total
development and stabilization costs of developments in INDUS’s
pipeline, anticipated leasing activity, and expected capital
availability and liquidity. Although INDUS believes that its plans,
intentions and expectations reflected in such forward-looking
statements are reasonable, it can give no assurance that such
plans, intentions or expectations will be achieved. The projected
information disclosed herein is based on assumptions and estimates
that, while considered reasonable by INDUS as of the date hereof,
are inherently subject to significant business, economic,
competitive and regulatory uncertainties and contingencies, many of
which are beyond the control of INDUS and which could cause actual
results and events to differ materially from those expressed or
implied in the forward-looking statements. Other important factors
that could affect the outcome of the events set forth in these
statements are described in INDUS’s Securities and Exchange
Commission filings, including the “Business,” “Risk Factors” and
“Forward-Looking Statements” sections in INDUS’s Annual Report on
Form 10-K for the fiscal year ended November 30, 2020, filed with
the SEC on February 18, 2021. INDUS disclaims any obligation to
update any forward-looking statements as a result of developments
occurring after the date of this press release except as required
by law.
Note Regarding Non-GAAP Financial Measures:
The Company uses NOI, Cash NOI, NOI of
Industrial/Logistics Properties and Cash NOI of
Industrial/Logistics Properties, as supplemental non-GAAP
performance measures. Management believes that the use of these
measures combined with net income (loss) (which remains the
Company’s primary measure of performance), improves the
understanding of the Company’s operating results among the
investing public and makes comparisons of operating results to
other REITs more meaningful.
NOI is a non-GAAP measure that includes the
rental revenue and operating expense directly attributable to the
Company’s real estate properties. NOI of Industrial/Logistics
Properties is NOI excluding NOI for the Company’s
non-industrial/logistics properties. The Company uses NOI and NOI
of Industrial/Logistics Properties as supplemental performance
measures because, in excluding real estate depreciation and
amortization expense, general and administrative expenses, interest
expense, gains (or losses) on the sale of real estate and other
non-operating items, they provide a performance measure that, when
compared year over year, captures trends in occupancy rates, rental
rates and operating costs. The Company also believes that NOI and
NOI of Industrial/Logistics Properties will be useful to investors
as a basis to compare its operating performance with that of other
REITs. However, because NOI and NOI of Industrial/Logistics
Properties excludes depreciation and amortization expense and
captures neither the changes in the value of the Company’s
properties that result from use or market conditions, nor the level
of capital expenditures and leasing commissions necessary to
maintain the operating performance of its properties (all of which
have real economic effect and could materially impact the Company’s
results from operations), the utility of NOI and NOI of
Industrial/Logistics Properties as measures of the Company’s
performance is limited. Other equity REITs may not calculate NOI or
NOI of Industrial/Logistics Properties in a similar manner and,
accordingly, the Company’s NOI and NOI of Industrial/Logistics
Properties may not be comparable to such other REITs’ NOI.
Accordingly, NOI and NOI of Industrial/Logistics Properties should
be considered only as a supplement to net income (loss) as a
measure of the Company’s performance. NOI and NOI of
Industrial/Logistics Properties should not be used as a measure of
the Company’s liquidity, nor is it indicative of funds available to
fund the Company’s cash needs. NOI and NOI of Industrial/Logistics
Properties should not be used as a substitute for cash flow from
operating activities in accordance with U.S. GAAP.
Cash NOI is a non-GAAP measure that the Company
calculates by adding or subtracting non-cash rental revenue,
including straight-line rental revenue, from NOI. Cash NOI of
Industrial/Logistics Properties is Cash NOI excluding NOI for the
Company’s non-industrial/logistics properties. The Company uses
Cash NOI and Cash NOI of Industrial/Logistics Properties, together
with NOI and NOI of Industrial/Logistics Properties, as
supplemental performance measures. Cash NOI and Cash NOI of
Industrial/Logistics Properties should not be used as measures of
the Company’s liquidity, nor are they indicative of funds available
to fund the Company’s cash needs. Cash NOI and Cash NOI of
Industrial/Logistics Properties should not be used as a substitute
for cash flow from operating activities computed in accordance with
U.S. GAAP.
CONTACT:Anthony
GaliciExecutive Vice President, Chief Financial
Officer(860) 286-1307
agalici@indusrt.com
Ashley PizzoVice President, Capital
Markets & Investor Relations(212)
218-7914 apizzo@indusrt.com
INDUS REALTY
TRUST, INC.Consolidated Statements of
Operations(dollars in thousands, except per share
data)(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended |
|
For the Six Months Ended |
|
|
June 30,2021 |
|
June 30,2020 |
|
June 30,2021 |
|
June 30,2020 |
Rental revenue |
|
$ |
9,836 |
|
|
$ |
9,270 |
|
|
$ |
19,923 |
|
|
$ |
18,132 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses of rental
properties |
|
|
1,132 |
|
|
|
1,080 |
|
|
|
2,765 |
|
|
|
2,252 |
|
Real estate taxes |
|
|
1,454 |
|
|
|
1,416 |
|
|
|
2,901 |
|
|
|
2,797 |
|
Depreciation and amortization
expense |
|
|
3,424 |
|
|
|
3,509 |
|
|
|
6,767 |
|
|
|
6,815 |
|
General and administrative
expenses |
|
|
2,724 |
|
|
|
2,413 |
|
|
|
5,694 |
|
|
|
4,556 |
|
Total operating
expenses |
|
|
8,734 |
|
|
|
8,418 |
|
|
|
18,127 |
|
|
|
16,420 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(1,711 |
) |
|
|
(1,836 |
) |
|
|
(3,460 |
) |
|
|
(3,676 |
) |
Change in fair value of
financial instruments |
|
|
(979 |
) |
|
|
— |
|
|
|
(719 |
) |
|
|
— |
|
Gain on sales of real estate
assets |
|
|
322 |
|
|
|
115 |
|
|
|
342 |
|
|
|
699 |
|
Investment and other
income |
|
|
115 |
|
|
|
1 |
|
|
|
122 |
|
|
|
26 |
|
|
|
|
(2,253 |
) |
|
|
(1,720 |
) |
|
|
(3,715 |
) |
|
|
(2,951 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income tax
benefit |
|
|
(1,151 |
) |
|
|
(868 |
) |
|
|
(1,919 |
) |
|
|
(1,239 |
) |
Income tax benefit |
|
|
— |
|
|
|
174 |
|
|
|
— |
|
|
|
259 |
|
Net loss |
|
$ |
(1,151 |
) |
|
$ |
(694 |
) |
|
$ |
(1,919 |
) |
|
$ |
(980 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
loss per common share |
|
$ |
(0.15 |
) |
|
$ |
(0.14 |
) |
|
$ |
(0.27 |
) |
|
$ |
(0.19 |
) |
INDUS REALTY
TRUST, INC.Non-GAAP Reconciliations – NOI and
Cash NOI(dollars in thousands)
|
|
|
|
|
For the Three Months Ended |
|
For the Six Months Ended |
|
June 30, |
|
June 30, |
|
June 30, |
|
June 30, |
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
Net loss |
$ |
(1,151 |
) |
|
$ |
(694 |
) |
|
$ |
(1,919 |
) |
|
$ |
(980 |
) |
Income tax benefit |
|
- |
|
|
|
(174 |
) |
|
|
- |
|
|
|
(259 |
) |
Pretax loss |
|
(1,151 |
) |
|
|
(868 |
) |
|
|
(1,919 |
) |
|
|
(1,239 |
) |
Exclude: |
|
|
|
|
|
|
|
Depreciation and amortization expense |
|
3,424 |
|
|
|
3,509 |
|
|
|
6,767 |
|
|
|
6,815 |
|
General and administrative expenses |
|
2,724 |
|
|
|
2,413 |
|
|
|
5,694 |
|
|
|
4,556 |
|
Interest expense |
|
1,711 |
|
|
|
1,836 |
|
|
|
3,460 |
|
|
|
3,676 |
|
Change in fair value of financial instruments |
|
979 |
|
|
|
- |
|
|
|
719 |
|
|
|
- |
|
Gain on sales of real estate assets |
|
(322 |
) |
|
|
(115 |
) |
|
|
(342 |
) |
|
|
(699 |
) |
Investment and other income |
|
(115 |
) |
|
|
(1 |
) |
|
|
(122 |
) |
|
|
(26 |
) |
NOI |
|
7,250 |
|
|
|
6,774 |
|
|
|
14,257 |
|
|
|
13,083 |
|
Noncash rental revenue
including straight-line rents |
|
(419 |
) |
|
|
(586 |
) |
|
|
(856 |
) |
|
|
(1,118 |
) |
Cash NOI |
$ |
6,831 |
|
|
$ |
6,188 |
|
|
$ |
13,401 |
|
|
$ |
11,965 |
|
|
|
|
|
|
|
|
|
NOI |
$ |
7,250 |
|
|
$ |
6,774 |
|
|
$ |
14,257 |
|
|
$ |
13,083 |
|
Exclude: |
|
|
|
|
|
|
|
Rental revenue from non-industrial/logistics properties |
|
(1,470 |
) |
|
|
(1,533 |
) |
|
|
(2,913 |
) |
|
|
(3,068 |
) |
Operating expenses of non-industrial/logistics properties |
|
481 |
|
|
|
425 |
|
|
|
1,048 |
|
|
|
964 |
|
Real estate taxes of non-industrial/logistics properties |
|
197 |
|
|
|
218 |
|
|
|
395 |
|
|
|
436 |
|
NOI of
Industrial/Logistics Properties |
|
6,458 |
|
|
|
5,884 |
|
|
|
12,787 |
|
|
|
11,415 |
|
Noncash rental revenue including straight-line rents of
industrial/logistics properties |
|
(403 |
) |
|
|
(486 |
) |
|
|
(799 |
) |
|
|
(795 |
) |
Cash NOI of
Industrial/Logistics Properties |
$ |
6,055 |
|
|
$ |
5,398 |
|
|
$ |
11,988 |
|
|
$ |
10,620 |
|
1 NOI is not a financial measure in conformity with generally
accepted accounting principles in the United States of America
(“U.S. GAAP”). For additional information, see “Note Regarding
Non-GAAP Financial Measures.”2 Cash NOI is not a financial measure
in conformity with U.S. GAAP. For additional information, see “Note
Regarding Non-GAAP Financial Measures.”3 Stabilized properties
reflect buildings that have reached 90% leased or have been in
service for at least one year since development completion or
acquisition date, whichever is earlier. 7800 Tuckaseegee Road,
which was 50.1% leased as of June 30, 2021, was acquired on June
28, 2021, and is not included in the Stabilized Properties pool for
the 2021 second quarter.4 As a part of INDUS’s standard development
and acquisition underwriting process, INDUS analyzes the targeted
initial full year stabilized Cash NOI yield for each development
project and acquisition target and establishes a range of initial
full year stabilized Cash NOI yields, which it refers to as
“underwritten stabilized Cash NOI yields.” Underwritten stabilized
Cash NOI yields are calculated as a development project’s or
acquisition’s initial full year stabilized Cash NOI as a percentage
of its estimated total investment, including costs to stabilize the
buildings to 95% occupancy (other than in connection with
build-to-suit development projects and single tenant properties).
INDUS calculates initial full year stabilized Cash NOI for a
development project or acquisition by subtracting its estimate of
the development project’s or acquisition’s initial full year
stabilized operating expenses, real estate taxes and non-cash
rental revenue, including straight-line rents (before interest,
income taxes, if any, and depreciation and amortization), from its
estimate of its initial full year stabilized rental revenue.5 The
sale of the 16 Stratton Farms residential parcels for a total of
approximately $0.9 million will be completed in two parts. The sale
of the first 9 lots closed in February 2021 and accounted for
approximately $0.5 million of the gross sales price. The sale of
the remaining 7 lots is expected to close in the 2021 third quarter
and represents approximately $0.4 million of the total gross sales
price.
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