General Growth Properties, Inc. (NYSE: GGP) (“GGP” or the
“Company”) today announced its financial results under GAAP for the
three and twelve months ended December 31, 2010.
GAAP OPERATING RESULTS AND EARNINGS PER SHARE (“EPS”)
Q4
ANNUAL Nov 10 -Dec 31, 2010 Oct 1 -Nov 9, 2010
Three Months
Ended
Dec 31, 2009
Nov 10 -Dec 31, 2010
Jan 1 -Nov 9, 2010
Twelve MonthsEndedDec 31, 2009
[ $THOUSANDS EXCEPT PER SHARE ] Successor Predecessor
Predecessor Successor Predecessor Predecessor
TOTAL REVENUES
$416,542 $309,602
$734,205 $416,542 $2,406,944
$2,881,387 OPERATING INCOME
$86,099
$124,281 $83,169 $86,099
$909,364 $537,414 NET LOSS
($254,216) ($888,702) ($612,359)
($254,216) ($1,185,758)
($1,284,689) TOTAL BASIC AND DILUTED (LOSS) EPS
($0.27) ($2.80) ($0.27)
($3.74)
GGP’s emergence resulted in the application of the acquisition
method of accounting as of November 9, 2010, and, therefore,
financial results subsequent to that date are required to be
presented separately for accounting purposes (the “Successor”). To
facilitate comparisons with our fourth quarter and annual 2009
results, we have combined such 2010 Predecessor and Successor
financial results in schedules included within this release and
described as “combined.” The Company considers this combined
presentation as complementary to the GAAP results as it facilitates
an understanding of the operating results for the period, but
should not be considered a substitute for the GAAP financial
presentation. Also, concurrent with this release, the Company has
made available on its website its quarterly package of supplemental
financial and operational information (the “Supplemental”) which
provides additional result detail.
2010 AND 2009 CORE NOI, CORE EBITDA, CORE FFO AND FFO
The following discussion is At Share, refer to the Supplemental
for details
Combined Three Months
EndedDecember 31 Combined Twelve Months
EndedDecember 31 [ $THOUSANDS EXCEPT PER SHARE AND
NUMBER OF SHARES ]
2010 2009
2010 2009 CORE NOI1
$588,373
$582,889 $2,231,181 $2,263,223
CORE EBITDA1
$535,531 $532,475
$2,060,819 $2,093,208 CORE FFO1
$249,752 $231,868 $901,064
$881,073 FFO
$254,877 ($413,897)
$600,482 ($421,384) CORE FFO PER SHARE2
$0.25 $0.73 $0.91 $2.76
FFO PER SHARE2
$0.26 ($1.29)
$0.60 ($1.32) COMMON SHARES OUTSTANDING
993,998,837 319,646,263
For analytical and comparison purposes, in certain schedules the
operations of the Predecessor and Successor are combined to present
totals for the period.
(1) In order to present GGP’s operations in a manner most
relevant to its future operations, CORE EBITDA, CORE FFO and CORE
NOI (all as defined below) have been presented to exclude certain
non-comparable and non-recurring revenues and expenses.
(2) Per share amounts calculated using December 31 diluted
common shares outstanding and reflected as if those shares were
outstanding during the entire period shown, which is different than
how total basic and diluted EPS is computed under GAAP, which is
based on the weighted average shares outstanding during the period.
We have presented FFO and CORE FFO per share based on diluted
amounts outstanding at the end of the period as we believe such
information is more meaningful and reflects the significant capital
changes that occurred due to the Company’s emergence.
(3) See definitions under NON-GAAP SUPPLEMENTAL FINANCIAL
MEASURES AND DEFINITIONS.
QUARTERLY AND YEARLY HIGHLIGHTS
- Comparable Tenant Sales on a trailing
12 month basis increased to $446 per square foot or 6.4% compared
to the same period last year. We have had tenant sales increases
every month since December 2009.
- Regional Mall Occupancy remained stable
at 92.9% compared to the prior year; while rental spread on
permanent tenant occupancy was 2.9% in 2010.
- During 2010, we executed 2,400 new and
renewal leases totaling 7.3 million square feet.
- 2010 Core NOI was $2.23 billion and
remained relatively unchanged year-over-year.
- On January 17, 2011, Sandeep Mathrani
assumed the role of chief executive officer.
- Recent additions to our senior
management team in the areas of leasing and anchor store
relationships are expected to further drive our progress in
2011.
“The fourth quarter 2010 was a defining moment for GGP and it
set the stage for us to build the best retail real estate company
in the country. With a new management team in place, a team that
has tremendous experience and expertise, we anticipate a long-term
positive impact on our properties and the company. We now have
focus and commitment to drive revenue and invest capital with
discipline to create value for our shareholders,” said Sandeep
Mathrani, chief executive officer of General Growth Properties.
FINANCIAL RESULTS FOR THE THREE MONTHS ENDED DECEMBER 31,
2010 AND 2009
- Revenues remained consistent with the
same period in 2009 after adjusting for the results of acquisition
accounting applied upon emergence.
- G&A was higher in 2010 by $17.8
million due to incurrence after emergence of legal, consultant and
other emergence-related costs (not classified as reorganization
costs), partially offset by the sale of our Third Party Management
Company.
- Based on the results of Old GGP’s
evaluations for impairment, impairment charges of approximately
$197.3 million were recognized for the quarter ended December 31,
2009.
- Permanent Warrant expense of $205.3
million in the quarter ended December 31, 2010, was due to the
non-cash, mark-to-market expense related to the Permanent Warrant
liability as of such date, primarily due to the increase in price
of GGP’s common stock since the Effective Date.
FINANCIAL RESULTS FOR THE YEAR ENDED DECEMBER 31, 2010 and
2009
- Total revenues decreased $59.3 million
primarily as a result of acquisition accounting applied upon
emergence totaling $20 million as well as a decrease in Specialty
Leasing by $15 million.
- Other property operating costs
decreased $13.8 million due to an $8 million settlement with a
utility provider and lower energy rates, driving energy expense
down.
- Improvement in provision for doubtful
accounts due to better overall general economic conditions.
CAPITAL TRANSACTIONS AND LIQUIDITY
- On February 25, 2011, GGP announced an
amendment to its existing $300 million three-year senior secured
revolving credit facility (the "Revolver"). The amendment increases
the Revolver commitment amount up to approximately $720 million and
adds a provision that, subject to satisfaction of certain
conditions, allows the Company to further increase the commitment
amounts up to $1 billion. The amendment also provides a step-down
in interest rates and collateral requirements as the overall
leverage of the Company improves. The Revolver remains undrawn at
close and will provide additional financial flexibility.
- Since July 2010, GGP has closed in
excess of $2.5 billion, at share, of new mortgage financing. We
anticipate pursuing an additional $1 billion of financing in the
second quarter of 2011 to further extend the debt maturity profile
in this low interest rate environment and reduce near-term
amortization.
- In December we sold four properties
(Gateway Overlook, Plaza 9400, Division Crossing and Halsey
Crossing) and the substantial portion of another property (Lockport
Mall), generating $84.6 million in cash. GGP is under
contract to sell Arizona Center, an urban mixed-use property
located in downtown Phoenix, Arizona. The sale is anticipated to
close (subject only to customary closing conditions) on or prior to
March 15, 2011, and is expected to generate approximately $128
million in pre-tax net proceeds.
- Reflective of our focus on our
high-quality properties, we have transferred five of our Special
Consideration Properties to their respective lenders (two in
November 2010 and three in February 2011) pursuant to agreements
negotiated in conjunction with our secured property debt
restructuring. The remaining eight Special Consideration Properties
are expected to be sold or transferred to the applicable lenders by
the summer of 2011. All Special Consideration Properties have been
classified as discontinued operations for financial reporting
purposes.
STOCK OFFERING TRANSACTIONS
On November 9, 2010, GGP emerged through the contribution of
approximately $6.8 billion from Brookfield, Pershing Square,
Fairholme, Blackstone and Texas Teachers (the “New Investors”); the
spin-off to GGP’s former stockholders of the Master Planned
Communities and certain other properties; and the agreement to
repay in full the remaining allowed bankruptcy claims of the
debtors that remained in bankruptcy. On November 15 (and November
23 with respect to the underwriters’ option to purchase additional
shares), we sold approximately 154.9 million shares of our common
stock to the public, at $14.75 per share (before underwriting
discounts), and bought back approximately 179.3 million shares of
our common stock from the New Investors as permitted by the
respective agreements. This resulted in proceeds of an additional
$700 million over and above the initial contributions from the New
Investors. As a result of the HHC spin-off, the operations of the
properties distributed, including all of the operations of the
Master Planned Communities, have been reclassified to discontinued
operations and excluded from our real estate property net operating
income (“NOI”) and other performance metrics for all periods
presented.
FOURTH QUARTER 2010 AND YEAR-END EARNINGS CALL
An earnings call is scheduled on March 1, 2011, at 9:00 a.m.
Eastern time with Chief Executive Officer Sandeep Mathrani and
Chief Financial Officer Steve Douglas. To participate, log on to
www.GGP.com 10 minutes prior to the start time. Participants
wanting to ask questions of Messrs Mathrani and Douglas must
participate by phone by dialing one of the following numbers:
Operator Assisted Toll-Free Dial-In Number: (877) 845-1018;
Operator Assisted International Dial-In Number: (707) 287-9345.
“Sales figures are starting to bounce back for our retailers.
Unemployment is seeing small, but steady decreases. Consumer
confidence is returning. These are all positive indicators that our
industry is moving in the right direction. With our best-in-class
assets, our leadership team, and financial flexibility, we believe
we are well-positioned for short-term and long-term success,” said
Mr. Mathrani.
NON-GAAP SUPPLEMENTAL FINANCIAL MEASURES AND
DEFINITIONS
REAL ESTATE PROPERTY NET OPERATING INCOME (NOI) AND CORE
NOI
The Company believes that NOI is a useful supplemental measure
of the Company’s operating performance. The Company defines NOI as
operating revenues (rental income, tenant recoveries and other
income) less property and related expenses (real estate taxes,
property maintenance costs, marketing and other property expenses).
NOI has been reflected on a proportionate basis (at the Company’s
ownership share). Other REITs may use different methodologies for
calculating NOI, and accordingly, the Company’s NOI may not be
comparable to other REITs. Because NOI excludes general and
administrative expenses, interest expense, retail investment
property impairment or other non-recoverable development costs,
depreciation and amortization, gains and losses from property
dispositions, allocations to non-controlling interests,
reorganization items, strategic initiatives, provision for income
taxes, discontinued operations and extraordinary items, it provides
a performance measure that, when compared year over year, reflects
the revenues and expenses directly associated with owning and
operating commercial real estate properties and the impact on
operations from trends in occupancy rates, rental rates and
operating costs. This measure thereby provides an operating
perspective not immediately apparent from GAAP operating or net
income (loss) attributable to common stockholders. The Company uses
NOI to evaluate its operating performance on a property-by-property
basis because NOI allows the Company to evaluate the impact that
factors such as lease structure, lease rates and tenant base, which
vary by property, have on the Company’s operating results, gross
margins and investment returns.
In addition, management believes that NOI provides useful
information to the investment community about the Company’s
operating performance. However, due to the exclusions noted above,
NOI should only be used as an alternative measure of the Company’s
financial performance.
CORE NOI excludes from both years the NOI impacts of non-cash
and certain non-comparable items such as straight-line rent and
intangible asset and liability amortization resulting from
acquisition accounting. We present Core NOI, and Core EBITDA and
Core FFO as below, as we believe certain investors and other users
of our financial information use them as measures of the Company’s
historical operating performance.
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND
AMORTIZATION
Earnings before interest, taxes, depreciation and amortization
(“EBITDA”) is defined as net income (loss) attributable to common
stockholders, adjusted to exclude interest expense net of interest
income, Permanent Warrant expense, income tax provision (benefit),
discontinued operations, allocations to non-controlling interests,
depreciation and amortization. “Core EBITDA” comprises EBITDA as
defined immediately above and excludes certain non-cash and certain
non-recurring items such as our Core NOI adjustments described
above, provisions for impairment, emergence reorganization items,
strategic initiatives and certain management and administration
costs.
FUNDS FROM OPERATIONS (“FFO”) AND CORE FFO
The Company, consistent with real estate industry and investment
community preferences, uses FFO as a supplemental measure of
operating performance for a Real Estate Investment Trust (REIT).
The National Association of Real Estate Investment Trusts (NAREIT)
defines FFO as net income (loss) attributable to common
stockholders (computed in accordance with Generally Accepted
Accounting Principles (GAAP)), excluding gains (or losses) from
cumulative effects of accounting changes, extraordinary items and
sales of properties, plus real estate related depreciation and
amortization and including adjustments for unconsolidated
partnerships and joint ventures.
The Company considers FFO a supplemental measure for equity
REITs and a complement to GAAP measures because it facilitates an
understanding of the operating performance of the Company’s
properties. FFO does not give effect to real estate depreciation
and amortization since these amounts are computed to allocate the
cost of a property over its useful life. Since values for
well-maintained real estate assets have historically increased or
decreased based upon prevailing market conditions, the Company
believes that FFO provides investors with a clearer view of the
Company’s operating performance. As with our presentation of Core
NOI and Core EBITDA, Core FFO excludes from FFO certain items that
are non cash and certain non-comparable items such as our Core NOI
adjustments, Core EBITDA adjustments, and FFO items such as FFO
from discontinued operations, Permanent Warrant expense, and
interest expense on debt repaid or settled, all as a result of our
emergence, acquisition accounting and other capital contribution or
restructuring events.
RECONCILIATIONS OF NON-GAAP SUPPLEMENTAL FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES
In order to provide a better understanding of the relationship
between our non-GAAP Supplemental Financial measures of NOI, Core
NOI, EBITDA, Core EBITDA, FFO and Core FFO, reconciliations have
been provided as follows: a reconciliation of NOI and Core NOI to
GAAP Operating Income (loss); a reconciliation of EBITDA and Core
EBITDA to GAAP net income, a reconciliation of Core FFO and FFO to
GAAP net income (loss) attributable to common stockholders has been
provided. None of our non-GAAP Supplemental Financial measures
represent cash flow from operating activities in accordance with
GAAP, none should be considered as an alternative to GAAP net
income (loss) attributable to common stockholders and none are
necessarily indicative of cash available to fund cash needs. In
addition, the Company has presented such financial measures on a
consolidated and unconsolidated basis (at the Company’s ownership
share) as the Company believes that given the significance of the
Company’s operations that are owned through investments accounted
for on the equity method of accounting, the detail of the
operations of the Company’s unconsolidated properties provides
important insights into the income and FFO produced by such
investments for the Company as a whole.
FORWARD LOOKING STATEMENTS
This press release contains forward-looking statements. Actual
results may differ materially from the results suggested by these
forward-looking statements, for a number of reasons, including, but
not limited to, our ability to refinance, extend, restructure or
repay our remaining debt (including that of our Unconsolidated Real
Estate Affiliates) with maturities in the short to intermediate
term, our ability to raise capital through equity issuances, asset
sales or the incurrence of new debt, retail and credit market
conditions, impairments, our liquidity demands and retail and
economic conditions. Readers are referred to the documents filed by
General Growth Properties, Inc. with the Securities and Exchange
Commission, which further identify the important risk factors that
could cause actual results to differ materially from the
forward-looking statements in this release. The Company disclaims
any obligation to update any forward-looking statements.
ABOUT GGP
GGP is one of the nation’s largest shopping center owners. GGP
has ownership and management interest in 169 regional and super
regional shopping malls in 43 states. The company portfolio totals
174 million square feet of retail space. A publicly-traded real
estate investment trust (REIT), GGP is listed on the New York Stock
Exchange under the symbol GGP.
FINANCIAL OVERVIEW
Consolidated Statements of Income 1
(In thousands, except per share)
Three
Months Ended Twelve Months Ended
Nov 10 - Dec 31, 2010
Oct 1 -
Nov 9, 2010
Oct 1 -
Dec 31, 2010
Dec 31, 2009
Nov 10 - Dec 31, 2010
Jan 1 -
Nov 9, 2010
Jan 1 -
Dec 31, 2010
Dec 31, 2009 Successor
Predecessor Combined 2
Predecessor Successor Predecessor
Combined 2 Predecessor
Revenues: Minimum rents $ 261,316 $ 200,749 $
462,065 $ 468,334 $ 261,316 $ 1,558,069 $ 1,819,385 $ 1,845,844
Tenant recoveries 109,757 85,062 194,819 196,265 109,757 694,360
804,117 829,249 Overage rents 19,804 9,074 28,878 24,188 19,804
34,776 54,580 48,447 Management fees and other corporate revenues
8,894 6,288 15,182 18,244 8,894 54,351 63,245 75,304 Other
16,771 8,429 25,200
27,174 16,771
65,388 82,159
82,543
Total revenues 416,542
309,602 726,144
734,205 416,542
2,406,944
2,823,486 2,881,387
Expenses: Real estate taxes 36,585 26,595 63,180 63,906
36,585 222,459 259,044 255,869 Property maintenance costs 20,901
12,195 33,096 37,185 20,901 92,212 113,113 104,644 Marketing 12,245
3,426 15,671 11,743 12,245 24,271 36,516 32,153 Other property
operating costs 68,692 54,692 123,384 119,517 68,692 396,320
465,012 471,810 Provision for doubtful accounts 480 1,956 2,436
3,802 480 15,870 16,350 26,944 Property management and other costs
29,821 12,763 42,584 45,281 29,821 137,834 167,655 173,425 General
and administrative 22,262 2,058 24,320 8,728 22,262 24,735 46,997
32,299 Strategic initiatives - - - - - - - 61,961 Provisions for
impairment - 148 148 190,855 - 15,733 15,733 475,607 Depreciation
and amortization 139,457 71,488
210,945 170,019
139,457 568,146 707,603
709,261
Total expenses
330,443 185,321
515,764 651,036
330,443 1,497,580
1,828,023
2,343,973 Operating income $
86,099 $ 124,281
$ 210,380 $ 83,169
$ 86,099 $ 909,364
$ 995,463 $
537,414 Interest income 723 562 1,285 363 723 1,524
2,247 1,618 Interest expense (139,130 ) (187,467 ) (326,597 )
(319,097 ) (139,130 ) (1,249,444 ) (1,388,574 ) (1,290,176 )
Permanent Warrant expense (205,252 ) -
(205,252 ) - (205,252 )
- (205,252 ) -
Loss before income taxes, noncontrolling interests,
equity in income of Unconsolidated Real Estate Affiliates and
reorganization items $ (257,560 )
$ (62,624 ) $
(320,184 ) $ (235,565 )
$ (257,560 ) $ (338,556
) $ (596,116 ) $
(751,144 ) (Provision for) benefit from income taxes
8,929 61,915 70,844 10,870 8,929 60,573 69,502 (6,469 ) Equity in
(loss) income of Unconsolidated Real Estate Affiliates (504 )
(32,190 ) (32,694 ) (3,285 ) (504 ) 21,857 21,353 32,843
Reorganization items - (228,040 )
(228,040 ) 148,989 -
(339,874 ) (339,874 )
104,976
Loss from continuing operations
(249,135 ) (260,939 ) (510,074
) (78,991 ) (249,135 )
(596,000 ) (845,135 ) (619,794
) Discontinued operations - loss on dispositions 3
(6,949 ) (655,891 ) (662,840 )
(545,325 ) (6,949 ) (616,362 )
(623,311 ) (684,829 )
Net loss
(256,084 ) (916,830 ) (1,172,914
) (624,316 ) (256,084 )
(1,212,362 ) (1,468,446 )
(1,304,623 ) Allocation to noncontrolling interests
1,868 28,128
29,996 11,957 1,868
26,604 28,472
19,934
Net loss attributable to common
stockholders $ (254,216 ) $
(888,702 ) $ (1,142,918 )
$ (612,359 ) $ (254,216
) $ (1,185,758 ) $
(1,439,974 ) $ (1,284,689
) Basic and Diluted (Loss) Earnings Per Share:
Continuing operations $ (0.26 ) $ (0.77 ) $ (0.21 ) $ (0.26
) $ (1.84 ) $ (1.92 ) Discontinued operations (0.01 )
(2.03 ) (1.75 ) (0.01 ) (1.90 )
(2.19 )
Total basic and diluted (loss) earnings per
share $ (0.27 ) $
(2.80 ) $ (1.96 ) $
(0.27 ) $ (3.74 )
$ (4.11 ) 1 Successor and Predecessor
amounts presented in accordance with GAAP. 2 For analytical and
comparison purposes, the operations of the Predecessor and
Successor are Combined to present totals for the period. 3 Refer to
Page 31 (Discontinued Operations).
FINANCIAL OVERVIEW
Consolidated Balance Sheets 1
(in thousands)
As of December 31, 2010
2
As of December 31, 2009
Assets: Investment in real estate: Land $ 4,644,712 $
3,327,447 Buildings and equipment 20,300,355 22,851,511 Less
accumulated depreciation (129,794) (4,494,297) Developments
in progress 117,137 417,969 Net property and equipment 24,932,410
22,102,630 Investment in and loans to/from Unconsolidated Real
Estate Affiliates 3,231,660 1,979,313 Investment property
and property held for development and sale - 1,753,175 Net
investment in real estate 28,164,070 25,835,118 Cash and cash
equivalents 1,021,311 654,396 Accounts and notes receivable, net
114,099 404,041 Goodwill - 199,664 Deferred expenses, net 175,669
301,808 Prepaid expenses and other assets 2,300,452 754,747 Assets
held for disposition 591,778 -
Total Assets
$ 32,367,379 $ 28,149,774 Liabilities:
Mortgages, notes and loans payable $ 18,047,957 $ 7,300,772
Investment in and loans to/from Unconsolidated Real Estate
Affiliates - 38,289 Deferred tax liabilities 36,463 866,400
Permanent warrant liability 1,041,004 - Tax indemnification
liability 303,750 - Accounts payable and accrued expenses 1,931,970
1,122,888 Liabilities held for disposition 592,122 -
Liabilities not subject to compromise 21,953,266 9,328,349
Liabilities subject to compromise - 17,767,253
Total Liabilities $ 21,953,266 $ 27,095,602
Redeemable noncontrolling interests: Preferred 120,756 120,756
Common 111,608 86,077
Total Redeemable
Noncontrolling Interests $ 232,364 $ 206,833
Equity: Total stockholders' equity 10,079,102
822,963 Noncontrolling interests in consolidated real
estate affiliates 102,647 24,376
Total Equity
10,181,749 847,339 Total Liabilities
and Equity $ 32,367,379 $ 28,149,774 1
Presented in accordance with GAAP 2 Effected for the application of
Acquisition Accounting on the Effective Date.
FINANCIAL OVERVIEW - Proportionate
Schedules
Reconciliation of Core NOI, Core EBITDA,
and Core FFO, at share
(in thousands, except per share)
Three Months Ended
Twelve Months Ended
Dec 31, 2010 Dec 31, 2009 Dec 31, 2010
Dec 31, 2009
Combined Predecessor Combined
Predecessor NOI $ 569,302 $ 578,611 $
2,246,036 $ 2,293,204 Core NOI adjustments: Straight-line rent 1
(7,265
) (408 ) (40,988 ) (33,911 ) Above- and below-market tenant leases,
net 1 18,531 (1,950 ) 14,313 (11,215 ) Above- and below-market
ground rent expense, net 1 (39 ) - (39 ) - Above- and below-market
building rent, net 1 242 - 242 - Other 7,602
6,636 11,617
15,145 Total Core NOI adjustments
19,071
4,278 (14,855 )
(29,981 )
Core NOI $
588,373
$ 582,889 $
2,231,181 $ 2,263,223
EBITDA $ 251,558 $ 479,169 $ 1,676,272
$ 1,675,634 Core NOI adjustments
19,071
4,278 (14,855 ) (29,981 ) Provisions for impairment 21,222 197,304
37,248 485,260 Reorganization items 2 228,040 (148,989 ) 339,874
(104,976 ) Strategic initiatives - - - 61,961 Management and
administrative costs, net 3 15,640 713
22,280 5,310 Total Core
EBITDA adjustments
283,973
53,306 384,547
417,574
Core EBITDA $
535,531
$ 532,475 $
2,060,819 $ 2,093,208
FFO $ 254,877 $ (413,897 ) $ 600,482 $
(421,384 ) Core EBITDA adjustments
283,973
53,306 384,547 417,574 FFO from discontinued operations (506,490 )
541,481 (613,146 ) 641,245 Mark-to-market adjustments on debt 4,523
(3,308 ) 44,094 (14,194 ) Default interest 50,010 903 135,473 903
Interest expense relating to extinguished debt 28,335 64,006
213,831 249,658 Permanent warrant liability expense 205,252 -
205,252 - Provision for (benefit from) income taxes
(70,728 ) (10,623 ) (69,469 )
7,271 Total FFO adjustments
(5,125
) 645,765 300,582
1,302,457
Core FFO $
249,752
$ 231,868 $
901,064 $
881,073
Core FFO per share - diluted 4 $
0.25 $ 0.73 $
0.91 $
2.76
1 These items were impacted by the effects of
acquisition accounting as of November 9, 2010. 2 Reorganization
items reflect bankruptcy-related activity, including gains/losses
on liabilities subject to compromise, interest income, U.S. Trustee
fees, and other restructuring costs, incurred during the Chapter 11
cases from April 16, 2009 to November 9, 2010. 3 Refer to Page 11
(Management and Administrative Costs, net). 4 Core FFO and FFO per
share amounts determined using December 31 diluted common shares
outstanding and calculated assuming the shares were outstanding for
the entire period as management believes this presentation to be
more meaningful.
FINANCIAL OVERVIEW - Proportionate
Schedules
Reconciliation of Non-GAAP to GAAP
Financial Measures
(in thousands)
Three Months
Ended Twelve Months Ended
Nov 10 -
Dec 31, 2010
Oct 1 -
Nov 9, 2010
Dec 31, 2010 Dec 31, 2009
Nov 10 -
Dec 31, 2010
Jan 1 -
Nov 9, 2010
Dec 31, 2010 Dec 31, 2009
Successor Predecessor Combined
1 Predecessor Successor
Predecessor Combined 1
Predecessor Reconciliation of NOI to GAAP Operating
Income (Loss) NOI: Segment basis $ 324,655 $
244,647 $ 569,302 $ 578,611 $ 324,655 $ 1,921,381 $ 2,246,036 $
2,293,204 Unconsolidated Properties (57,372 )
(41,641 ) (99,013 ) (101,560 )
(57,372 ) (330,480 ) (387,852 )
(389,434 ) Consolidated Properties 267,283 203,006 470,289
477,051 267,283 1,590,901 1,858,184 1,903,770 Management fees and
other corporate revenues 8,894 6,288 15,182 18,244 8,894 54,351
63,245 75,304 Property management and other costs (29,821 ) (12,763
) (42,584 ) (45,281 ) (29,821 ) (137,834 ) (167,655 ) (173,425 )
General and administrative (22,262 ) (2,058 ) (24,320 ) (8,728 )
(22,262 ) (24,735 ) (46,997 ) (32,300 )
Strategic Initiatives
- - - - - - - (61,961 ) Provisions for impairment - (148 ) (148 )
(190,855 ) - (15,733 ) (15,733 ) (475,605 ) Depreciation and
amortization (139,457 ) (71,488 ) (210,945 ) (170,019 ) (139,457 )
(568,146 ) (707,603 ) (709,261 ) Noncontrolling interest in NOI of
Consolidated Properties and other 1,462
1,444 2,906 2,757
1,462 10,560
12,022 10,892
Operating income
$ 86,099 $ 124,281
$ 210,380 $ 83,169
$ 86,099 $ 909,364
$ 995,463 $
537,414 Reconciliation of EBITDA to GAAP
Net Income (Loss) Attributable to Common Stockholders EBITDA:
Segment basis $ 275,566 $ (24,008 ) $ 251,558 $ 479,169 $ 275,566 $
1,400,706 $ 1,676,272 $ 1,675,634 Unconsolidated Properties
(53,113 ) (10,904 ) (64,017 )
(82,176 ) (53,113 ) (281,833 )
(334,946 ) (344,309 ) Consolidated Properties
222,453 (34,912 ) 187,541 396,993 222,453 1,118,873 1,341,326
1,331,325 Preferred unit distributions 1,641 1,197 2,838 2,427
1,641 8,203 9,844 9,434 Depreciation and amortization (139,457 )
(71,488 ) (210,945 ) (170,019 ) (139,457 ) (568,146 ) (707,603 )
(709,261 ) Noncontrolling interest in NOI of Consolidated
Properties and other 1,462 1,444 2,906 2,757 1,462 10,560 12,022
10,892 Interest income 723 562 1,285 363 723 1,524 2,247 1,618
Interest expense (139,130 ) (187,467 ) (326,597 ) (319,097 )
(139,130 ) (1,249,444 ) (1,388,574 ) (1,290,176 ) Permanent warrant
liability expense (205,252 ) - (205,252 ) - (205,252 ) - (205,252 )
- (Provision for) benefit from income taxes 8,929 61,915 70,844
10,870 8,929 60,573 69,502 (6,469 ) Equity in (loss) income of
Unconsolidated Real Estate Affiliates (504 ) (32,190 ) (32,694 )
(3,285 ) (504 ) 21,857 21,353 32,843 Discontinued operations - loss
on dispositions (6,949 ) (655,891 ) (662,840 ) (545,325 ) (6,949 )
(616,362 ) (623,311 ) (684,829 ) Allocation to noncontrolling
interests 1,868 28,128
29,996 11,957 1,868
26,604 28,472
19,934
Net loss attributable to common
stockholders $ (254,216 ) $
(888,702 ) $ (1,142,918 )
$ (612,359 ) $ (254,216
) $ (1,185,758 ) $
(1,439,974 ) $ (1,284,689
) Reconciliation of FFO to GAAP Net Income (Loss)
Attributable to Common Stockholders FFO: Segment basis $
(82,668 ) $ 337,545 $ 254,877 $ (413,897 ) $ (82,668 ) $ 683,151 $
600,482 $ (421,384 ) Unconsolidated Properties -
- - -
- - -
- Consolidated Properties (82,668 )
337,545 254,877 (413,897 ) (82,668 ) 683,151 600,482 (421,384 )
Depreciation and amortization of capitalized real estate costs
(167,403 ) (83,299 ) (250,702 ) (203,717 ) (167,403 ) (683,007 )
(850,410 ) (846,772 ) Losses on sales of investment properties
(4,951 ) (1,155,272 ) (1,160,223 ) 970 (4,951 ) (1,173,944 )
(1,178,895 ) 957 Noncontrolling interests in depreciation of
Consolidated Properties and other 382 432 814 1,016 382 4,038 4,420
3,601 Redeemable noncontrolling interests 4,019 16,485 20,504
14,674 4,019 23,321 27,340 31,370 Depreciation and amortization of
discontinued operations (3,595 ) (4,593 )
(8,188 ) (11,405 ) (3,595 )
(39,317 ) (42,912 )
(52,461 )
Net loss attributable to common stockholders
$ (254,216 ) $ (888,702
) $ (1,142,918 ) $
(612,359 ) $ (254,216 )
$ (1,185,758 ) $
(1,439,974 ) $ (1,284,689
) Reconciliation of Equity in NOI of
Unconsolidated Properties to GAAP Equity in Income of
Unconsolidated Real Estate Affiliates Equity in Unconsolidated
Properties: NOI $ 57,372 $ 41,641 $ 99,013 $ 101,560 $ 57,372 $
330,480 $ 387,852 $ 389,434 Net property management fees and costs
(3,425 ) (1,549 ) (4,974 ) (6,152 ) (3,425 ) (14,182 ) (17,607 )
(20,760 ) Net interest expense (24,345 ) (18,330 ) (42,675 )
(42,531 ) (24,345 ) (137,562 ) (161,907 ) (155,668 )
General and administrative, provisions for
impairment, income taxes and noncontrolling interest in FFO
(892 ) (29,198 ) (30,090 ) (13,447 ) (892 ) (34,294 ) (35,186 )
(25,046 ) FFO of discontinued unconsolidated properties (300
) (11,569 ) (11,869 )
(5,947 ) (300 ) 24,852
24,552 (2,432 ) FFO of unconsolidated
properties 28,410 (19,005 ) 9,405 33,483 28,410 169,294 197,704
185,528 Depreciation and amortization of capitalized real estate
costs (28,929 ) (13,195 ) (42,124 ) (38,673 ) (28,929 ) (127,525 )
(156,454 ) (154,645 ) Other, including gains on sales of investment
properties 15 10
25 1,905 15
(19,912 ) (19,897 ) 1,960
Equity in income of Unconsolidated Real Estate Affiliates
$ (504 ) $ (32,190
) $ (32,694 ) $
(3,285 ) $ (504 )
$ 21,857 $ 21,353
$ 32,843
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