SCOTTSDALE, Ariz., Feb. 14, 2019 /PRNewswire/ -- Healthcare
Trust of America, Inc. (NYSE: HTA) ("HTA") announced results for
the quarter and year ended December 31,
2018.
"In 2018, HTA demonstrated its ability to execute in all market
conditions. Our portfolio remains best-in-class, generating
Same-Property Cash NOI growth of 2.5% for the year, driven
primarily by solid rental revenue gains of 2.2%. Pricing
power is strong, as evidenced by an acceleration in re-leasing
spreads to 4.4% in the fourth quarter," stated Chairman, CEO and
President Scott D. Peters. "We
remained disciplined in our capital allocation, selling non-core
assets at attractive pricing, focusing on relationship driven
developments, and avoiding lower quality assets that continue to
trade at aggressive pricing. As a result, we enter 2019 with
a fortress balance sheet that provides us with security and
flexibility to pursue opportunities in these changing real estate
markets."
Highlights
Fourth Quarter 2018:
- Net Income Attributable to Common Stockholders was
$15.3 million, or $0.07 per diluted share, for Q4 2018.
- Funds From Operations ("FFO"), as defined by the
National Association of Real Estate Investment Trusts ("NAREIT"),
was $85.2 million, or $0.41 per diluted share, for Q4 2018.
- Normalized FFO was $84.2
million, or $0.40 per diluted
share, for Q4 2018.
- Normalized Funds Available for Distribution ("FAD") was
$68.3 million for Q4 2018.
- Same-Property Cash Net Operating Income ("NOI")
increased 2.7%, to $111.4 million,
compared to Q4 2017.
- Leasing: HTA's portfolio leased rate increased 20 basis
points to 92.0%, compared to Q4 2017. During Q4 2018, HTA executed
0.6 million square feet of gross leasable area ("GLA") of new and
renewal leases. Re-leasing spreads increased to 4.4% while tenant
retention for its Same-Property portfolio was 77% by GLA for Q4
2018.
- Capital Allocation: During Q4 2018, HTA paid down
approximately $68 million in
outstanding secured mortgage loans at an interest rate of
approximately 5.5% per annum. HTA also repurchased $50.7 million of its outstanding common stock at
an average price of $26.08 per share
under its stock repurchase plan during Q4 2018.
Year Ended 2018:
- Net Income Attributable to Common Stockholders was
$213.5 million, or $1.02 per diluted share, an increase of
$0.68 per diluted share, compared to
2017.
- FFO, as defined by NAREIT, was $335.6 million, or $1.60 per diluted share, an increase of
$0.07 per diluted share, compared to
2017.
- Normalized FFO was $340.4
million, or $1.62 per diluted
share, an increase of 12.7%, compared to 2017.
- Normalized FAD was $285.3
million, an increase of 9.4%, compared to 2017.
- Same-Property Cash NOI increased 2.5%, to $308.9 million, compared to 2017. Excluding the
medical office buildings ("MOBs") located on HTA's Forest Park
Dallas campus, Same-Property Cash NOI growth was 2.9% for
2018.
- Leasing: During 2018, HTA executed approximately 2.8
million square feet of GLA of new and renewal leases, or over 12%,
of the total GLA of its portfolio. Re-leasing spreads increased to
2.6% while tenant retention for its Same-Property portfolio was 81%
by GLA for 2018.
Balance Sheet and Capital Markets
- Debt: During 2018, HTA paid down approximately
$241 million in outstanding secured
mortgage loans, including the settlement of three cash flow hedges.
Additionally, in August 2018, HTA
modified its $200.0 million unsecured
term loan, decreasing pricing at HTA's current credit rating by 65
basis points and extending the maturity to 2024.
- Balance Sheet: HTA ended 2018 with total liquidity of
$1.1 billion, inclusive of
$126.2 million of cash and cash
equivalents, resulting in total leverage of (i) 31.3%, measured as
debt less cash and cash equivalents to total capitalization, and
(ii) 5.4x, measured as debt less cash and cash equivalents to
Adjusted Earnings before Interest, Taxes, Depreciation and
Amortization for real estate ("Adjusted EBITDAre").
Noteworthy 2018 Activities
- Dispositions: During 2018, HTA completed the disposition
of 20 MOBs for an aggregate gross sales price of $308.6 million, representing approximately 1.2
million square feet of GLA, and generating net gains of
$166.0 million. These dispositions
primarily consisted of the Q3 2018 disposition of its Greenville, South Carolina MOB portfolio (the
"Greenville Disposition"), for an aggregate gross sales price of
$294.3 million at a low 5% forward
cap rate, including any releasing impacts and capital expenditures.
HTA acquired the portfolio for $163
million in September 2009 and
generated approximately 2% growth per annum, resulting in unlevered
returns of over 13% during HTA's period of ownership.
- Stock Repurchases: In August
2018, HTA's Board of Directors approved a stock repurchase
plan authorizing HTA to purchase up to $300.0 million of its outstanding common stock
from time to time. During 2018, HTA repurchased approximately 2.6
million shares of its outstanding common stock for an aggregate
amount of $67.2 million under its
stock repurchase plan. Subsequent to December 31, 2018, HTA repurchased approximately
346,000 shares of its outstanding common stock at an average price
of $24.65 per share under its stock
repurchase plan.
- Development/Redevelopment: During 2018, HTA announced
(i) a new development in its key gateway market of Miami, Florida and (ii) commenced two
redevelopments, including an agreement to build a new on-campus MOB
in Raleigh, North Carolina. These
projects will have total expected construction costs of
$70.6 million and are 78% pre-leased
to major health systems.
- Forest Park Update: During 2018, HTA entered into
approximately 87,000 square feet of GLA of new leases on the Forest
Park Dallas campus. The total leased rate was approximately 86% as
of December 31, 2018.
- 2017 Investment Performance: During Q4 2018, HTA
generated $36.9 million of Cash NOI
from its 2017 investments, including its investment in its
unconsolidated joint venture. As of December
31, 2018, HTA's run rate on its 2017 investments was
approximately 5.4%, which included the full year impact of new
leases which have been executed, but which have not yet
commenced.
- Dividend: On February 14,
2019, HTA's Board of Directors announced a quarterly cash
dividend of $0.310 per share of
common stock and per OP Unit. The quarterly dividend is to be paid
on April 10, 2019 to stockholders of
record of its common stock and holders of its OP Units on
April 3, 2019.
Impact of Future Accounting Standards
- Topic 842 Leases: The Financial Accounting Standards
Board issued Topic 842, which was effective for HTA as of
January 1, 2019. Topic 842 modifies
the treatment of initial direct costs, which historically under
Topic 840 have been capitalized upon meeting criteria provided for
in that applicable guidance. These initial direct costs now under
ASC 842 are eligible for capitalization only if they are
incremental in nature (i.e. would only be incurred if HTA enters
into a new lease arrangement). Under this guidance, HTA anticipates only commissions paid and
other incurred costs incremental to HTA's leasing activity will
qualify as initial direct costs. For the year ended December 31, 2018, HTA capitalized approximately
$4.9 million of initial direct costs
(as defined by ASC 840). Upon adoption, certain of these initial
direct costs will be classified as general and administrative
expenses on HTA's consolidated statements of operations. HTA
estimates the range of these additional expenses to be
approximately $4 million to
$5 million on an annualized
basis.
2019 Guidance
HTA expects 2019 guidance to range as
follows (in millions, except per share data):
|
|
Annual
Expectations
|
|
|
Low
|
to
|
High
|
Net income
attributable to common stockholders per share
|
|
$0.33
|
|
$0.36
|
|
|
|
|
|
Same-Property Cash
NOI
|
|
2.0%
|
|
3.0%
|
|
|
|
|
|
FFO per share, as
defined by NAREIT
|
|
$1.61
|
|
$1.66
|
|
|
|
|
|
Normalized FFO per
share
|
|
$1.62
|
|
$1.67
|
The 2019 outlook guidance includes the following additional
assumptions: (i) $250 million of
investments at a 5.5% average yield; (ii) $75 million of dispositions at a 6.0% average
yield; (iii) 209.2 million diluted, common shares outstanding; and
(iv) $4 million to $5 million of selling costs, or approximately
$0.02 per share, associated with
lease accounting changes. HTA expects leverage, measured as
debt less cash and cash equivalents to Adjusted EBITDAre to
remain stable year-over-year.
HTA's 2019 guidance is based on a number of various assumptions
that are subject to change and many of which are outside the
control of the Company. If actual results vary from these
assumptions, HTA's expectations may change. There can be no
assurance that HTA will achieve these results.
About Healthcare Trust of America, Inc.
Healthcare
Trust of America, Inc. (NYSE: HTA) is the largest dedicated owner
and operator of MOBs in the United
States, comprising approximately 23.2 million square feet of
GLA, with $6.8 billion invested
primarily in MOBs. HTA provides real estate infrastructure
for the integrated delivery of healthcare services in
highly-desirable locations. Investments are targeted to build
critical mass in 20 to 25 leading gateway markets that generally
have leading university and medical institutions, which translates
to superior demographics, high-quality graduates, intellectual
talent and job growth. The strategic markets HTA invests in
support a strong, long-term demand for quality medical office
space. HTA utilizes an integrated asset management platform
consisting of on-site leasing, property management, engineering and
building services, and development capabilities to create complete,
state of the art facilities in each market. This drives
efficiencies, strong tenant and health system relationships, and
strategic partnerships that result in high levels of tenant
retention, rental growth and long-term value creation.
Headquartered in Scottsdale,
Arizona, HTA has developed a national brand with dedicated
relationships at the local level.
Founded in 2006 and listed on the New York Stock Exchange in
2012, HTA has produced attractive returns for its stockholders that
have outperformed the S&P 500 and US REIT indices. More
information about HTA can be found on the Company's Website
(www.htareit.com), Facebook, LinkedIn and Twitter.
Forward-Looking Language
This press release contains
certain forward-looking statements with respect to HTA.
Forward-looking statements are statements that are not descriptions
of historical facts and include statements regarding management's
intentions, beliefs, expectations, plans or predictions of the
future, 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. Because such statements
include risks, uncertainties and contingencies, actual results may
differ materially and in adverse ways from those expressed or
implied by such forward-looking statements. These risks,
uncertainties and contingencies include, without limitation, the
following: changes in economic conditions generally and the real
estate market specifically; legislative and regulatory changes,
including changes to laws governing the taxation of REITs and
changes to laws governing the healthcare industry; the availability
of capital; changes in interest rates; competition in the real
estate industry; the supply and demand for operating properties in
our proposed market areas; changes in accounting principles
generally accepted in the United States
of America; policies and guidelines applicable to REITs; the
availability of properties to acquire; and the availability of
financing. Additional information concerning us and our
business, including additional factors that could materially and
adversely affect our financial results, include, without
limitation, the risks described under Part I, Item 1A - Risk
Factors, in our Annual Report on Form 10-K and in our filings with
the SEC.
Conference Call
HTA will host a conference call and
webcast on Friday, February 15, 2019
at 11:00 a.m. Eastern Time
(9:00 a.m. Mountain Time) to review
its financial performance and operating results for the quarter and
year ended December 31, 2018.
Conference Call and Webcast Details:
Domestic Dial-In Number: (877) 507-6265
International Dial-In Number: (412) 902-6633
Canada Dial-In Number: (855) 669-9657
Webcast: www.htareit.com under the Investor Relations tab
Replay Conference Call Details:
Domestic Dial-In Number: (877) 344-7529
International Dial-In Number: (412) 317-0088
Canada Dial-In Number: (855) 669-9658
Conference ID: 10127577
Available February 15, 2019 (one hour
after the end of the conference call) to March 15, 2019 at 11:00
a.m. Eastern Time (9:00 a.m. Mountain
Time)
Financial Contact:
Robert A. Milligan
Chief Financial Officer
480.998.3478
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONSOLIDATED
BALANCE SHEETS
|
(Unaudited and in
thousands, except for share and per share data)
|
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
ASSETS
|
|
|
|
Real estate
investments:
|
|
|
|
Land
|
$
|
481,871
|
|
|
$
|
485,319
|
|
Building and
improvements
|
5,787,152
|
|
|
5,830,824
|
|
Lease
intangibles
|
599,864
|
|
|
639,199
|
|
Construction in
progress
|
4,903
|
|
|
14,223
|
|
|
6,873,790
|
|
|
6,969,565
|
|
Accumulated
depreciation and amortization
|
(1,208,169)
|
|
|
(1,021,691)
|
|
Real estate
investments, net
|
5,665,621
|
|
|
5,947,874
|
|
Investment in
unconsolidated joint venture
|
67,172
|
|
|
68,577
|
|
Cash and cash
equivalents
|
126,221
|
|
|
100,356
|
|
Restricted
cash
|
7,309
|
|
|
18,204
|
|
Receivables and other
assets, net
|
223,415
|
|
|
207,857
|
|
Other intangibles,
net
|
98,738
|
|
|
106,714
|
|
Total
assets
|
$
|
6,188,476
|
|
|
$
|
6,449,582
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Liabilities:
|
|
|
|
Debt
|
$
|
2,541,232
|
|
|
$
|
2,781,031
|
|
Accounts payable and
accrued liabilities
|
185,073
|
|
|
167,852
|
|
Derivative financial
instruments - interest rate swaps
|
—
|
|
|
1,089
|
|
Security deposits,
prepaid rent and other liabilities
|
59,567
|
|
|
61,222
|
|
Intangible
liabilities, net
|
61,146
|
|
|
68,203
|
|
Total
liabilities
|
2,847,018
|
|
|
3,079,397
|
|
Commitments and
contingencies
|
|
|
|
Redeemable
noncontrolling interests
|
6,544
|
|
|
6,737
|
|
Equity:
|
|
|
|
Preferred stock,
$0.01 par value; 200,000,000 shares authorized; none issued and
outstanding
|
—
|
|
|
—
|
|
Common stock, $0.01
par value; 1,000,000,000 shares authorized; 205,267,349 and
204,892,118 shares issued and outstanding as of December 31, 2018
and 2017, respectively
|
2,053
|
|
|
2,049
|
|
Additional paid-in
capital
|
4,525,969
|
|
|
4,508,528
|
|
Accumulated other
comprehensive income
|
307
|
|
|
274
|
|
Cumulative dividends
in excess of earnings
|
(1,272,305)
|
|
|
(1,232,069)
|
|
Total stockholders'
equity
|
3,256,024
|
|
|
3,278,782
|
|
Noncontrolling
interests
|
78,890
|
|
|
84,666
|
|
Total
equity
|
3,334,914
|
|
|
3,363,448
|
|
Total liabilities and
equity
|
$
|
6,188,476
|
|
|
$
|
6,449,582
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(Unaudited and in
thousands, except per share data)
|
|
|
Three Months Ended
December 31,
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Revenues:
|
|
|
|
|
|
|
|
Rental
income
|
$
|
172,204
|
|
|
$
|
173,607
|
|
|
$
|
696,030
|
|
|
$
|
612,556
|
|
Interest and other
operating income
|
94
|
|
|
163
|
|
|
396
|
|
|
1,434
|
|
Total
revenues
|
172,298
|
|
|
173,770
|
|
|
696,426
|
|
|
613,990
|
|
Expenses:
|
|
|
|
|
|
|
|
Rental
|
55,253
|
|
|
53,273
|
|
|
220,617
|
|
|
192,147
|
|
General and
administrative
|
8,915
|
|
|
8,225
|
|
|
35,196
|
|
|
33,403
|
|
Transaction
|
70
|
|
|
267
|
|
|
1,003
|
|
|
5,885
|
|
Depreciation and
amortization
|
69,566
|
|
|
72,086
|
|
|
279,630
|
|
|
244,986
|
|
Impairment
|
—
|
|
|
8,829
|
|
|
8,887
|
|
|
13,922
|
|
Total
expenses
|
133,804
|
|
|
142,680
|
|
|
545,333
|
|
|
490,343
|
|
Income before
other income (expense)
|
38,494
|
|
|
31,090
|
|
|
151,093
|
|
|
123,647
|
|
Interest income
(expense):
|
|
|
|
|
|
|
|
Interest related to
derivative financial instruments
|
397
|
|
|
(204)
|
|
|
694
|
|
|
(1,031)
|
|
Gain on change in
fair value of derivative financial instruments, net
|
—
|
|
|
—
|
|
|
—
|
|
|
884
|
|
Total interest
related to derivative financial instruments, including net change
in fair value of derivative financial instruments
|
397
|
|
|
(204)
|
|
|
694
|
|
|
(147)
|
|
Interest related to
debt
|
(24,854)
|
|
|
(25,656)
|
|
|
(102,543)
|
|
|
(85,344)
|
|
(Loss) gain on sale
of real estate, net
|
(395)
|
|
|
37,799
|
|
|
165,977
|
|
|
37,802
|
|
Gain (loss) on
extinguishment of debt, net
|
1,334
|
|
|
—
|
|
|
242
|
|
|
(11,192)
|
|
Income from
unconsolidated joint venture
|
330
|
|
|
401
|
|
|
1,735
|
|
|
782
|
|
Other
income
|
299
|
|
|
42
|
|
|
428
|
|
|
29
|
|
Net
income
|
$
|
15,605
|
|
|
$
|
43,472
|
|
|
$
|
217,626
|
|
|
$
|
65,577
|
|
Net income
attributable to noncontrolling interests
|
(276)
|
|
|
(946)
|
|
|
(4,163)
|
|
|
(1,661)
|
|
Net income
attributable to common stockholders
|
$
|
15,329
|
|
|
$
|
42,526
|
|
|
$
|
213,463
|
|
|
$
|
63,916
|
|
Earnings per
common share - basic:
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders
|
$
|
0.07
|
|
|
$
|
0.21
|
|
|
$
|
1.04
|
|
|
$
|
0.35
|
|
Earnings per
common share - diluted:
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders
|
$
|
0.07
|
|
|
$
|
0.20
|
|
|
$
|
1.02
|
|
|
$
|
0.34
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
206,409
|
|
|
204,434
|
|
|
206,065
|
|
|
181,064
|
|
Diluted
|
210,338
|
|
|
208,626
|
|
|
210,061
|
|
|
185,278
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(Unaudited and in
thousands)
|
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
|
2016
|
Cash flows from
operating activities:
|
|
|
|
|
|
Net income
|
$
|
217,626
|
|
|
$
|
65,577
|
|
|
$
|
47,345
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
271,441
|
|
|
239,044
|
|
|
175,285
|
|
Share-based
compensation expense
|
9,755
|
|
|
6,870
|
|
|
7,071
|
|
Impairment
|
8,887
|
|
|
13,922
|
|
|
3,080
|
|
Income from
unconsolidated joint venture
|
(1,735)
|
|
|
(782)
|
|
|
—
|
|
Distributions from
unconsolidated joint venture
|
2,665
|
|
|
750
|
|
|
—
|
|
Gain on sale of real
estate, net
|
(165,977)
|
|
|
(37,802)
|
|
|
(8,966)
|
|
(Gain) loss on
extinguishment of debt, net
|
(242)
|
|
|
11,192
|
|
|
3,025
|
|
Change in fair value
of derivative financial instruments
|
—
|
|
|
(884)
|
|
|
(1,344)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Receivables and other
assets, net
|
(17,558)
|
|
|
(33,295)
|
|
|
(21,234)
|
|
Accounts payable and
accrued liabilities
|
9,478
|
|
|
37,406
|
|
|
2,171
|
|
Prepaid rent and
other liabilities
|
3,056
|
|
|
5,545
|
|
|
(2,738)
|
|
Net cash provided by
operating activities
|
337,396
|
|
|
307,543
|
|
|
203,695
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
Investments in real
estate
|
(17,389)
|
|
|
(2,383,581)
|
|
|
(591,954)
|
|
Investment in
unconsolidated joint venture
|
—
|
|
|
(68,839)
|
|
|
—
|
|
Development of real
estate
|
(34,270)
|
|
|
(25,191)
|
|
|
—
|
|
Proceeds from the
sale of real estate
|
305,135
|
|
|
80,640
|
|
|
26,555
|
|
Capital
expenditures
|
(77,870)
|
|
|
(64,833)
|
|
|
(42,994)
|
|
Collection of real
estate notes receivable
|
703
|
|
|
9,964
|
|
|
—
|
|
Advances on real
estate notes receivable
|
—
|
|
|
(3,256)
|
|
|
—
|
|
Net cash provided by
(used in) investing activities
|
176,309
|
|
|
(2,455,096)
|
|
|
(608,393)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
Borrowings on
unsecured revolving credit facility
|
145,000
|
|
|
570,000
|
|
|
574,000
|
|
Payments on unsecured
revolving credit facility
|
(145,000)
|
|
|
(658,000)
|
|
|
(704,000)
|
|
Proceeds from
unsecured senior notes
|
—
|
|
|
900,000
|
|
|
347,725
|
|
Borrowings on
unsecured term loans
|
—
|
|
|
—
|
|
|
200,000
|
|
Payments on unsecured
term loans
|
—
|
|
|
—
|
|
|
(155,000)
|
|
Payments on secured
mortgage loans
|
(241,021)
|
|
|
(77,024)
|
|
|
(110,935)
|
|
Deferred financing
costs
|
(782)
|
|
|
(16,904)
|
|
|
(3,191)
|
|
Debt extinguishment
costs
|
(1,909)
|
|
|
(10,571)
|
|
|
—
|
|
Security
deposits
|
—
|
|
|
2,419
|
|
|
924
|
|
Proceeds from
issuance of common stock
|
72,814
|
|
|
1,746,956
|
|
|
418,891
|
|
Issuance of OP
Units
|
411
|
|
|
—
|
|
|
2,706
|
|
Repurchase and
cancellation of common stock
|
(70,319)
|
|
|
(3,413)
|
|
|
(2,642)
|
|
Dividends
paid
|
(252,651)
|
|
|
(207,087)
|
|
|
(159,174)
|
|
Distributions paid to
noncontrolling interest of limited partners
|
(5,278)
|
|
|
(5,308)
|
|
|
(3,951)
|
|
Redemption of
redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
(4,572)
|
|
Net cash (used in)
provided by financing activities
|
(498,735)
|
|
|
2,241,068
|
|
|
400,781
|
|
Net change in cash,
cash equivalents and restricted cash
|
14,970
|
|
|
93,515
|
|
|
(3,917)
|
|
Cash, cash
equivalents and restricted cash - beginning of year
|
118,560
|
|
|
25,045
|
|
|
28,962
|
|
Cash, cash
equivalents and restricted cash - end of year
|
$
|
133,530
|
|
|
$
|
118,560
|
|
|
$
|
25,045
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
NOI, CASH NOI AND
SAME-PROPERTY CASH NOI
|
(Unaudited and in
thousands)
|
|
|
Three Months Ended
December 31,
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net income
|
$
|
15,605
|
|
|
$
|
43,472
|
|
|
$
|
217,626
|
|
|
$
|
65,577
|
|
General and
administrative expenses
|
8,915
|
|
|
8,225
|
|
|
35,196
|
|
|
33,403
|
|
Transaction expenses
(1)
|
70
|
|
|
267
|
|
|
1,003
|
|
|
5,885
|
|
Depreciation and
amortization expense
|
69,566
|
|
|
72,086
|
|
|
279,630
|
|
|
244,986
|
|
Impairment
|
—
|
|
|
8,829
|
|
|
8,887
|
|
|
13,922
|
|
Interest expense and
net change in fair value of derivative financial
instruments
|
24,457
|
|
|
25,860
|
|
|
101,849
|
|
|
85,491
|
|
Loss (gain) on sale
of real estate, net
|
395
|
|
|
(37,799)
|
|
|
(165,977)
|
|
|
(37,802)
|
|
(Gain) loss on
extinguishment of debt, net
|
(1,334)
|
|
|
—
|
|
|
(242)
|
|
|
11,192
|
|
Income from
unconsolidated joint venture
|
(330)
|
|
|
(401)
|
|
|
(1,735)
|
|
|
(782)
|
|
Other
income
|
(299)
|
|
|
(42)
|
|
|
(428)
|
|
|
(29)
|
|
NOI
|
$
|
117,045
|
|
|
$
|
120,497
|
|
|
$
|
475,809
|
|
|
$
|
421,843
|
|
NOI percentage
growth
|
(2.9)
|
%
|
|
|
|
12.8
|
%
|
|
|
|
|
|
|
|
|
|
|
NOI
|
$
|
117,045
|
|
|
$
|
120,497
|
|
|
$
|
475,809
|
|
|
$
|
421,843
|
|
Straight-line rent
adjustments, net
|
(2,394)
|
|
|
(2,803)
|
|
|
(10,683)
|
|
|
(8,637)
|
|
Amortization of
(below) and above market leases/leasehold interests, net
|
26
|
|
|
108
|
|
|
216
|
|
|
354
|
|
Notes receivable
interest income
|
(30)
|
|
|
(104)
|
|
|
(131)
|
|
|
(1,193)
|
|
Other GAAP
adjustments
|
—
|
|
|
55
|
|
|
(117)
|
|
|
(19)
|
|
Cash NOI
|
$
|
114,647
|
|
|
$
|
117,753
|
|
|
$
|
465,094
|
|
|
$
|
412,348
|
|
Acquisitions not
owned/operated for all periods presented and disposed properties
Cash NOI
|
(834)
|
|
|
(6,027)
|
|
|
(147,881)
|
|
|
(99,043)
|
|
Redevelopment Cash
NOI
|
(349)
|
|
|
(725)
|
|
|
(2,273)
|
|
|
(4,797)
|
|
Intended for sale
Cash NOI
|
(2,074)
|
|
|
(2,581)
|
|
|
(6,055)
|
|
|
(7,161)
|
|
Same-Property Cash
NOI (2)
|
$
|
111,390
|
|
|
$
|
108,420
|
|
|
$
|
308,885
|
|
|
$
|
301,347
|
|
Same-Property Cash
NOI percentage growth
|
2.7
|
%
|
|
|
|
2.5
|
%
|
|
|
|
|
(1)
|
For the year ended
December 31, 2017, transaction costs included $4.6 million of
non-incremental costs related to the Duke acquisition.
|
(2)
|
Same-Property
includes 409 and 318 buildings for the three months and year ended
December 31, 2018 and 2017, respectively.
|
NOI is a non-GAAP financial measure that is defined as net
income or loss (computed in accordance with GAAP) before: (i)
general and administrative expenses; (ii) transaction expenses;
(iii) depreciation and amortization expense; (iv) impairment; (v)
interest expense and net change in fair value of derivative
financial instruments; (vi) gain or loss on sales of real estate;
(vii) gain or loss on extinguishment of debt; (viii) income or loss
from unconsolidated joint venture; and (ix) other income or
expense. HTA believes that NOI provides an accurate measure
of the operating performance of its operating assets because NOI
excludes certain items that are not associated with the management
of its properties. Additionally, HTA believes that NOI is a
widely accepted measure of comparative operating performance of
real estate investment trusts ("REITs"). However, HTA's use
of the term NOI may not be comparable to that of other REITs as
they may have different methodologies for computing this
amount. NOI should not be considered as an alternative to net
income or loss (computed in accordance with GAAP) as an indicator
of its financial performance. NOI should be reviewed in
connection with other GAAP measurements.
Cash NOI is a non-GAAP financial measure which excludes from
NOI: (i) straight-line rent adjustments; (ii) amortization of below
and above market leases/leasehold interests; (iii) notes receivable
interest income; and (iv) other GAAP adjustments. Contractual
base rent, contractual rent increases, contractual rent concessions
and changes in occupancy or lease rates upon commencement and
expiration of leases are a primary driver of HTA's revenue
performance. HTA believes that Cash NOI, which removes the
impact of straight-line rent adjustments, provides another
measurement of the operating performance of its operating
assets. Additionally, HTA believes that Cash NOI is a widely
accepted measure of comparative operating performance of
REITs. However, HTA's use of the term Cash NOI may not be
comparable to that of other REITs as they may have different
methodologies for computing this amount. Cash NOI should not
be considered as an alternative to net income or loss (computed in
accordance with GAAP) as an indicator of its financial
performance. Cash NOI should be reviewed in connection with
other GAAP measurements.
To facilitate the comparison of Cash NOI between periods, HTA
calculates comparable amounts for a subset of its owned and
operational properties referred to as "Same-Property".
Same-Property Cash NOI excludes (i) properties which have not been
owned and operated by HTA during the entire span of all periods
presented and disposed properties, (ii) HTA's share of
unconsolidated joint ventures, (iii) development, redevelopment and
land parcels, (iv) properties intended for disposition in the near
term which have (a) been approved by the Board of Directors, (b) is
actively marketed for sale, and (c) an offer has been received at
prices HTA would transact and the sales process is ongoing, and (v)
certain non-routine items. Same-Property Cash NOI should not
be considered as an alternative to net income or loss (computed in
accordance with GAAP) as an indicator of its financial
performance. Same-Property Cash NOI should be reviewed in
connection with other GAAP measurements.
HEALTHCARE TRUST
OF AMERICA, INC.
|
FFO, NORMALIZED
FFO AND NORMALIZED FAD
|
(Unaudited and in
thousands, except per share data)
|
|
|
Three Months Ended
December 31,
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net income
attributable to common stockholders
|
$
|
15,329
|
|
|
$
|
42,526
|
|
|
$
|
213,463
|
|
|
$
|
63,916
|
|
Depreciation and
amortization expense related to investments in real
estate
|
69,001
|
|
|
71,543
|
|
|
277,446
|
|
|
243,221
|
|
Loss (gain) on sale
of real estate, net
|
395
|
|
|
(37,799)
|
|
|
(165,977)
|
|
|
(37,802)
|
|
Impairment
|
—
|
|
|
8,829
|
|
|
8,887
|
|
|
13,922
|
|
Proportionate share
of joint venture depreciation and amortization
|
469
|
|
|
463
|
|
|
1,746
|
|
|
969
|
|
FFO attributable to
common stockholders
|
$
|
85,194
|
|
|
$
|
85,562
|
|
|
$
|
335,565
|
|
|
$
|
284,226
|
|
Transaction
expenses
|
70
|
|
|
267
|
|
|
859
|
|
|
1,242
|
|
Gain on change in
fair value of derivative financial instruments, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(884)
|
|
(Gain) loss on
extinguishment of debt, net
|
(1,334)
|
|
|
—
|
|
|
(242)
|
|
|
11,192
|
|
Noncontrolling income
from OP Units included in diluted shares
|
252
|
|
|
903
|
|
|
4,074
|
|
|
1,538
|
|
Other normalizing
items, net (1)
|
—
|
|
|
—
|
|
|
144
|
|
|
4,643
|
|
Normalized FFO
attributable to common stockholders
|
$
|
84,182
|
|
|
$
|
86,732
|
|
|
$
|
340,400
|
|
|
$
|
301,957
|
|
Other
income
|
(299)
|
|
|
(42)
|
|
|
(428)
|
|
|
(29)
|
|
Non-cash compensation
expense
|
1,925
|
|
|
1,377
|
|
|
9,755
|
|
|
6,870
|
|
Straight-line rent
adjustments, net
|
(2,394)
|
|
|
(2,803)
|
|
|
(10,683)
|
|
|
(8,637)
|
|
Amortization of
(below) and above market leases/leasehold interests and corporate
assets, net
|
592
|
|
|
652
|
|
|
2,401
|
|
|
2,119
|
|
Deferred revenue -
tenant improvement related
|
(1)
|
|
|
(5)
|
|
|
(71)
|
|
|
(28)
|
|
Amortization of
deferred financing costs and debt discount/premium, net
|
1,403
|
|
|
1,287
|
|
|
5,260
|
|
|
4,216
|
|
Recurring capital
expenditures, tenant improvements and leasing
commissions
|
(17,117)
|
|
|
(14,588)
|
|
|
(61,375)
|
|
|
(45,608)
|
|
Normalized FAD
attributable to common stockholders
|
$
|
68,291
|
|
|
$
|
72,610
|
|
|
$
|
285,259
|
|
|
$
|
260,860
|
|
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders per diluted share
|
$
|
0.07
|
|
|
$
|
0.20
|
|
|
$
|
1.02
|
|
|
$
|
0.34
|
|
FFO adjustments per
diluted share, net
|
0.34
|
|
|
0.21
|
|
|
0.58
|
|
|
1.19
|
|
FFO attributable to
common stockholders per diluted share
|
$
|
0.41
|
|
|
$
|
0.41
|
|
|
$
|
1.60
|
|
|
$
|
1.53
|
|
Normalized FFO
adjustments per diluted share, net
|
(0.01)
|
|
|
0.01
|
|
|
0.02
|
|
|
0.10
|
|
Normalized FFO
attributable to common stockholders per diluted share
|
$
|
0.40
|
|
|
$
|
0.42
|
|
|
$
|
1.62
|
|
|
$
|
1.63
|
|
|
|
|
|
|
|
|
|
Weighted average
diluted common shares outstanding
|
210,338
|
|
|
208,626
|
|
|
210,061
|
|
|
185,278
|
|
|
|
(1)
|
For the year ended
December 31, 2017, other normalizing items included $4.6 million of
non-incremental costs related to the Duke acquisition that were
included in transaction expenses on HTA's consolidated statements
of operations.
|
HTA computes FFO in accordance with the current standards
established by NAREIT. NAREIT defines FFO as net income or
loss attributable to common stockholders (computed in accordance
with GAAP), excluding gains or losses from sales of real estate
property and impairment write-downs of depreciable assets, plus
depreciation and amortization related to investments in real
estate, and after adjustments for unconsolidated partnerships and
joint ventures. Because FFO excludes depreciation and
amortization unique to real estate, among other items, it provides
a perspective not immediately apparent from net income or loss
attributable to common stockholders.
HTA computes Normalized FFO, which excludes from FFO: (i)
transaction expenses; (ii) gain or loss on change in fair value of
derivative financial instruments; (iii) gain or loss on
extinguishment of debt; (iv) noncontrolling income or loss from OP
Units included in diluted shares; and (v) other normalizing items,
which include items that are unusual and infrequent in
nature. HTA's methodology for calculating Normalized FFO may
be different from the methods utilized by other REITs and,
accordingly, may not be comparable to other REITs.
HTA also computes Normalized FAD, which excludes from Normalized
FFO: (i) other income or expense; (ii) non-cash compensation
expense; (iii) straight-line rent adjustments; (iv) amortization of
below and above market leases/leasehold interests and corporate
assets; (v) amortization of deferred financing costs and debt
premium/discount; and (vi) recurring capital expenditures, tenant
improvements and leasing commissions. HTA believes this
non-GAAP financial measure provides a meaningful supplemental
measure of its operating performance. Normalized FAD should
not be considered as an alternative to net income or loss
attributable to common stockholders (computed in accordance with
GAAP) as an indicator of its financial performance, nor is it
indicative of cash available to fund cash needs. Normalized
FAD should be reviewed in connection with other GAAP
measurements.
HTA presents these non-GAAP financial measures because it
considers them important supplemental measures of its operating
performance and believes they are frequently used by securities
analysts, investors and other interested parties in the evaluation
of REITs. Historical cost accounting assumes that the value
of real estate assets diminishes ratably over time. Since
real estate values have historically risen or fallen based on
market conditions, many industry investors have considered the
presentation of operating results for real estate companies that
use historical cost accounting to be insufficient by
themselves. These non-GAAP financial measures should not be
considered as alternatives to net income or loss attributable to
common stockholders (computed in accordance with GAAP) as
indicators of its financial performance. FFO and Normalized
FFO is not indicative of cash available to fund cash needs.
These non-GAAP financial measures should be reviewed in connection
with other GAAP measurements.
HEALTHCARE TRUST
OF AMERICA, INC.
|
NET DEBT TO
ADJUSTED EBITDAre
|
(Unaudited and in
thousands)
|
|
|
Three Months
Ended
|
|
December 31,
2018
|
Net income
|
$
|
15,605
|
|
Interest
expense
|
24,457
|
|
Depreciation and
amortization expense
|
69,566
|
|
Loss on sale of real
estate
|
395
|
|
Proportionate share
of joint venture depreciation and amortization
|
469
|
|
EBITDAre
|
$
|
110,492
|
|
Transaction
expenses
|
70
|
|
Gain on
extinguishment of debt, net
|
(1,334)
|
|
Non-cash compensation
expense
|
1,925
|
|
Pro forma impact of
dispositions
|
(144)
|
|
Adjusted
EBITDAre
|
$
|
111,009
|
|
|
|
Adjusted
EBITDAre, annualized
|
$
|
444,036
|
|
|
|
As of December 31,
2018:
|
|
Debt
|
$
|
2,541,232
|
|
Cash and cash
equivalents
|
(126,221)
|
|
Net Debt
|
$
|
2,415,011
|
|
|
|
Net Debt to Adjusted
EBITDAre
|
5.4
|
x
|
As defined by NAREIT, EBITDAre is computed as net income
or loss (computed in accordance with GAAP) plus: (i) interest
expense; (ii) income tax expense (not applicable to HTA); (iii)
depreciation and amortization expense; (iv) impairment; (v) gain or
loss on the sale of real estate; and (vi) and the proportionate
share of joint venture depreciation and amortization.
Previously defined as Adjusted EBITDA, Adjusted EBITDAre
is presented on an assumed annualized basis. HTA defines
Adjusted EBITDAre as EBITDAre (computed in accordance
with NAREIT as defined above) plus: (i) transaction expenses; (ii)
gain or loss on extinguishment of debt; (iii) non-cash compensation
expense; (iv) pro forma impact of its acquisitions/dispositions;
and (v) other normalizing items. HTA considers Adjusted
EBITDAre an important measure because it provides additional
information to allow management, investors, and its current and
potential creditors to evaluate and compare its core operating
results and its ability to service debt.
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SOURCE Healthcare Trust of America, Inc.