SCOTTSDALE, Ariz., Oct. 24, 2017 /PRNewswire/ -- Healthcare Trust of
America, Inc. (NYSE: HTA) ("HTA") announced results for the three
and nine months ended September 30,
2017.
Third Quarter 2017 Highlights
Operating
- Net Income Attributable to Common Stockholders:
Increased 114.1% to $13.8 million,
compared to Q3 2016. Earnings per diluted share increased
75.0% to $0.07 per diluted share,
compared to Q3 2016.
- Funds From Operations ("FFO"): As defined by the
National Association of Real Estate Investment Trusts ("NAREIT"),
increased 56.1%, to $84.2 million,
compared to Q3 2016. FFO per diluted share increased 7.9%, to
$0.41 per diluted share, compared to
Q3 2016.
- Normalized FFO: Increased 49.6%, to $85.4 million, compared to Q3 2016.
Normalized FFO per diluted share increased 5.0%, to $0.42 per diluted share, compared to Q3
2016.
- Normalized Funds Available for Distribution ("FAD"):
Increased 51.9%, to $74.8
million, compared to Q3 2016.
- Same-Property Cash Net Operating Income ("NOI"):
Increased $2.2 million, or 2.9%, to
$80.3 million, compared to Q3
2016.
Portfolio
- Investments: During the quarter, HTA had investments of
$160.7 million, totaling
approximately 314,000 square feet of GLA and which were 99% leased
as of the date of acquisition, bringing year-to-date investments to
$2.7 billion, net of development
credits received at the closing of the Duke acquisition. These investments included
the properties in the final closing associated with the Duke Realty
healthcare business ("Duke Assets") and completion of the portfolio
acquisition from a Tampa
developer, which were announced in Q2 2017. HTA's investments
for the quarter consisted of the following:
-
- Duke Assets: HTA acquired three additional properties in July
for an aggregate purchase price of $131.7
million. These properties total approximately 245,000
square feet of GLA and were 100% leased as of the date of
acquisition.
- Tampa Developer: HTA acquired two additional properties in July
and August for an aggregate purchase price of $29.0 million. These properties total
approximately 68,000 square feet of GLA and were 98% leased as of
the date of acquisition.
- Leasing: HTA entered into new and renewal leases on
approximately 745,000 square feet of GLA, or 3.1%, of its
portfolio. Tenant retention for the Same-Property portfolio
was 75% by GLA for the quarter, which included approximately
289,000 square feet of GLA of expiring leases. Renewal leases
included tenant improvements of $1.56
per square foot per year of the lease term and less than three days
of free rent per year of the lease term.
2017 Investments - Q3 Performance
- Investments: During 2017, HTA completed and closed
$2.7 billion of investments, totaling
approximately 6.6 million square feet of GLA, including projects
under development. These acquisitions included 93 in-service
properties and seven development properties, including four
recently developed properties and three properties under
development, but which were 100% pre-leased and expected to be
completed by Q2 2018. Approximately 89% of the GLA for these
investments are located in HTA's existing key markets, allowing HTA
to manage and service these properties with its existing property
management, building services, and leasing platform, thereby
generating additional cash flow opportunities.
- Cash NOI: During the quarter, HTA generated $32.9 million of Cash NOI on its 2017
investments, including a partial period impact for acquisitions
that closed and developments that were completed during the
period. As of September 30,
2017, HTA's run rate yield on its 2017 investments was
approximately 5.1%, which included the full quarter impact of
acquisitions and developments closed and completed in the period,
and new leases that were signed but not yet occupied.
- Leasing: HTA entered into new leases on approximately
26,000 square feet of GLA for its 2017 investments, or 0.4% of the
total acquired GLA. HTA also entered into renewal
leases totaling approximately 108,000 square feet of GLA. HTA
executed these leases utilizing its existing in-house leasing
representatives which would have resulted in capitalized leasing
commissions totaling $0.5 million, or
1.5% of third quarter Cash NOI, if third party brokers had been
used by HTA.
- Property Management & Building Services: As of the
end of the period, HTA provided property management services to 91%
of its 2017 investments as measured by GLA. During the
quarter, HTA earned over $1.0 million
of property management fees related to these properties which were
included in total Cash NOI. On an annual basis, these
properties generated a total of over $5.0
million in property management fees. As of the end of
the period, HTA provided building engineering services to
approximately 64% of the multi-tenanted properties included in its
2017 investments. In addition, during the quarter, HTA earned
over $250,000 in expense recoveries
from building services which were included in total Cash NOI.
- Development: During the third quarter, HTA-Development
completed two development projects located in Oxford, Mississippi and Dallas, TX, with a total construction cost of
$33.8 million. As such, four of
the seven development properties acquired by HTA as a part of the
Duke acquisition have been completed,
but are not all fully leased at this time. As of the end of
the quarter, these four properties were 77% leased and generated
$0.6 million of Cash NOI. HTA
is currently in the late stages of lease negotiations for an
additional 38,000 square feet of GLA that would bring the leased
rate on these properties to 90% if completed. The remaining
three properties under development are 100% pre-leased and are
projected to be completed by Q2 2018. In total, the seven
development properties are projected to generate between
$2.50 million and $2.75 million in
quarterly Cash NOI upon completion and stabilization.
Capital Markets
- Equity: In September 2017,
HTA entered into new equity distribution agreements with its
various sales agents with respect to its at-the-market ("ATM")
offering program of common stock with an aggregate sales amount of
up to $500.0 million.
- Debt: In July 2017, HTA,
as guarantor, and Healthcare Trust of America Holdings, LP
("HTALP"), as borrower, entered into an amended and restated
$1.3 billion unsecured credit
agreement which increased the amount available under the unsecured
revolving credit facility to $1.0
billion and extended the maturities of the unsecured
revolving credit facility to June 30, 2022 and for the
$300.0 million unsecured term loan
until February 1, 2023. The interest rate on the
unsecured revolving credit facility is adjusted LIBOR plus a margin
ranging from 0.83% to 1.55% per annum based on HTA's credit
rating.
Year-to-Date 2017 Highlights
Operating
- Net Income Attributable to Common Stockholders:
Decreased 27.1% to $21.4 million,
compared to year-to-date 2016. Earnings per diluted share
decreased 42.9% to $0.12 per diluted
share, compared to year-to-date 2016. Total revenues
increased $101.3 million due to the
continued growth in HTA's operations, however, the increase in
revenues was primarily offset as a result of the Duke acquisition by the increase in transaction
expenses and loss on extinguishment of debt related to bridge
facility fees paid.
- FFO: As defined by NAREIT, increased 28.5%, to
$198.7 million, compared to
year-to-date 2016. FFO per diluted share remained stable at
$1.12 per diluted share, compared to
year-to-date 2016.
- Normalized FFO: Increased 29.9%, to $215.2 million, compared to year-to-date
2016. Normalized FFO per diluted share increased 0.8% to
$1.21 per diluted share, compared to
year-to-date 2016.
- Normalized FAD: Increased 27.3%, to $188.3 million, compared to year-to-date
2016.
- Same-Property Cash NOI: Increased $6.6 million, or 3.1%, to $217.8 million, compared to year-to-date
2016. Same-Property rental revenue increased $4.1 million, or 1.7%, to $243.4 million, compared to year-to-date
2016.
Portfolio
- Investments: HTA completed investments of $2.7 billion, net of development credits received
at the closing of the Duke acquisition,
totaling approximately 6.6 million square feet of GLA, including
projects under development, and which were 92% leased as of the
date of acquisition and consisted of the following:
-
- As of September 30, 2017, HTA
closed on Duke Assets of approximately $2.24
billion for 71 properties and a parcel of land, including a
50% ownership interest in an unconsolidated joint venture, totaling
approximately 5.2 million square feet of GLA, including projects
under development, and were 94% leased as of the date of
acquisition. HTA's only remaining obligations related to the
Duke acquisition are the potential
acquisition of a land parcel in Miami,
FL and a single property in Texas that are each currently excluded from
HTA's purchase obligations due to current outstanding physical
condition issues.
- In addition, HTA completed investments of $458.3 million, totaling approximately 1.5
million square feet of GLA that were 93% leased as of the date of
acquisition and which were located substantially in certain of
HTA's 20 to 25 key markets.
- Development Platform Acquisition: During the nine months
ended September 30, 2017, HTA
completed its acquisition of Duke's
development and construction platform as part of the Duke acquisition. Prior to HTA's acquisition,
this best-in-class development platform, renamed HTA-Development by
HTA, had developed over $1.0 billion
in medical real estate assets over the last 10 years.
- Dispositions: HTA completed the disposition of a medical
office building located in Texas
for a gross sales price of $5.0
million and which totaled approximately 48,000 square feet
of GLA.
- Leasing: HTA entered into new and renewal leases on
approximately 2.0 million square feet of GLA, or 8.4%, of its
portfolio. Tenant retention for the Same-Property portfolio
was 78% by GLA year-to-date, which included approximately 1.3
million square feet of expiring leases. Renewal leases
included tenant improvements of $1.51
per square foot of GLA per year of the lease term and less than
five days of free rent per year of the lease term.
- Leased Rate: As of September 30,
2017, HTA had a leased rate for its portfolio of 91.7% by
GLA and 91.4% for its Same-Property portfolio.
Balance Sheet and Capital Markets
- Balance Sheet: As of September
30, 2017, HTA had total leverage of 31.9% measured as debt
to total capitalization, and 6.2x measured as debt to Adjusted
Earnings before Interest, Taxes, Depreciation and Amortization for
real estate ("Adjusted EBITDAre"). Total liquidity at
the end of the quarter was $928.9
million, including $919.5
million of availability under HTA's unsecured revolving
credit facility and $9.4 million of
cash and cash equivalents.
- Equity: During the nine months ended September 30, 2017, HTA issued and sold
approximately $1.7 billion of equity
at an average price of $28.70 per
share. Additionally, in September
2017, HTA entered into new equity distribution agreements
with its various sales agents with respect to its ATM offering
program of common stock with an aggregate sales amount of up to
$500.0 million.
- Debt: During the nine months ended September 30, 2017, HTA issued in a public
offering approximately $1.2 billion
in debt, which consisted of $900.0
million in senior unsecured notes at an average interest
rate of 3.4% per annum and an average duration of 7.7 years.
HTA also executed, as borrower, a $286.0
million promissory note with a 4.0% per annum interest rate
with the seller in the Duke
acquisition. Additionally, in July
2017, HTA, as guarantor, and HTALP, as borrower, entered
into an amended and restated $1.3
billion unsecured credit agreement which increased the
amount available under the unsecured revolving credit facility to
$1.0 billion and extended the
maturity date to June 30, 2022, and extended the maturity date
until February 1, 2023 under the $300.0
million unsecured term loan. These transactions were
used to substantially finance HTA's 2017 investments and position
its investment grade balance sheet for future growth.
Subsequent Events
- Investments: In October
2017, HTA completed an investment with a purchase price of
$8.3 million. As part of the
acquisition, HTA issued to the seller as a part of the acquisition
consideration a total of 16,972 operating partnership units in
HTALP with a market value at the time of issuance of $0.5 million.
- Equity: Subsequent to September
30, 2017, HTA issued approximately $200.0 million of common stock under the ATM,
including $75.0 million on a forward
basis which will be issued over the next six months.
- Dividends: On October 24, 2017, HTA's Board of
Directors announced a quarterly dividend of $0.305 per share of common stock. The
dividends are to be paid on January 9, 2018 to stockholders of
record of our common stock on January 2, 2018.
Financial Results - Third Quarter 2017
Rental Income
Rental income increased 48.4% to $175.4
million for the three months ended September 30, 2017, compared to $118.3 million for the three months ended
September 30, 2016.
Net Income
Net income increased 110.2% to $14.0
million for the three months ended September 30, 2017, compared to $6.6 million net income for the three months
ended September 30, 2016.
FFO
FFO, as defined by NAREIT, was $0.41 per diluted share, or $84.2 million, for the three months ended
September 30, 2017, compared to
$0.38 per diluted share, or
$54.0 million, for the three months
ended September 30, 2016.
Normalized FFO
Normalized FFO was $0.42 per
diluted share, or $85.4 million, for
the three months ended September 30,
2017, compared to $0.40 per
diluted share, or $57.1 million, for
the three months ended September 30,
2016.
Normalized FAD
Normalized FAD increased 51.9% to $74.8
million, for the three months ended September 30, 2017, compared to $49.2 million for the three months ended
September 30, 2016.
NOI
NOI increased 46.9% to $119.7
million for the three months ended September 30, 2017, compared to $81.5 million for the three months ended
September 30, 2016.
Same-Property Cash NOI
Same-Property Cash NOI increased $2.2
million, or 2.9%, to $80.3
million, for the three months ended September 30, 2017, compared to $78.0 million for the three months ended
September 30, 2016.
General and Administrative Expenses
General and administrative expenses were $8.3 million for the three months ended
September 30, 2017, compared to
$7.3 million for the three months
ended September 30, 2016.
Interest Expense and Change in Fair Value of Derivative
Financial Instruments
The total interest expense and change in fair value of
derivative financial instruments for the three months ended
September 30, 2017, was $26.2 million, all of which related to debt and
interest rate swaps.
Investment Activity
During the three months ended September
30, 2017, HTA completed investments of $160.7 million, totaling approximately 314,000
square feet of GLA which were 99% leased as of the acquisition
date.
Tenant Retention
Tenant retention for the Same-Property portfolio was 75% by GLA
for the quarter, which included approximately 289,000 square feet
of GLA of expiring leases.
Financial Results - Year-to-Date 2017
Rental Income
Rental income increased 29.6% to $438.9
million for the nine months ended September 30, 2017, compared to $338.6 million for the nine months ended
September 30, 2016.
Net Income
Net income decreased 26.8% to $22.1
million for the nine months ended September 30, 2017, compared to $30.2 million for the nine months ended
September 30, 2016. Total
revenues increased $101.3 million due
to the continued growth in HTA's operations, however, the increase
in revenues was primarily offset as a result of the Duke acquisition by the increase in transaction
expenses and loss on extinguishment of debt related to bridge
facility fees paid.
FFO
FFO, as defined by NAREIT, was $1.12 per diluted share, or $198.7 million, for the nine months ended
September 30, 2017, compared to
$1.12 per diluted share, or
$154.6 million, for the nine months
ended September 30, 2016.
Normalized FFO
Normalized FFO was $1.21 per
diluted share, or $215.2 million, for
the nine months ended September 30,
2017, compared to $1.20 per
diluted share, or $165.7 million, for
the nine months ended September 30,
2016.
Normalized FAD
Normalized FAD increased 27.3% to $188.3
million, for the nine months ended September 30, 2017, compared to $147.9 million for the nine months ended
September 30, 2016.
NOI
NOI increased 29.0% to $301.3
million for the nine months ended September 30, 2017, compared to $233.6 million for the nine months ended
September 30, 2016.
Same-Property Cash NOI
Same-Property Cash NOI increased $6.6
million, or 3.1%, to $217.8
million, for the nine months ended September 30, 2017, compared to $211.1 million for the nine months ended
September 30, 2016.
Same-Property rental revenue increased $4.1
million, or 1.7%, to $243.4
million, for the nine months ended September 30, 2017, compared to the nine months
ended September 30, 2016.
General and Administrative Expenses
General and administrative expenses were $25.2 million for the nine months ended
September 30, 2017, compared to
$20.9 million for the nine months
ended September 30, 2016.
Interest Expense and Change in Fair Value of Derivative
Financial Instruments
The total interest expense and change in fair value of
derivative financial instruments for the nine months ended
September 30, 2017, was $59.6 million, which included $60.5 million of interest expense related to debt
and interest rate swaps, and a net gain of $0.9 million on the change in the fair value of
HTA's derivative financial instruments.
HTA ended the quarter with a weighted average interest rate of
3.44% per annum, including the impact of interest rate swaps.
The weighted average remaining term of HTA's total debt was 5.9
years, including extension options.
Investment Activity
During the nine months ended September
30, 2017, HTA completed investments of $2.7 billion, net of development credits received
at the closing of the Duke acquisition,
including its investment in a unconsolidated joint venture,
totaling 6.6 million square feet of GLA, including projects under
development, which were 92% leased as of the acquisition date.
Leased Rate, Occupancy Rate and Tenant Retention
The leased rate (includes leases which have been executed, but
which have not yet commenced) was 91.7% by GLA as of September 30, 2017. The occupancy rate of
HTA's portfolio was 90.6% by GLA as of September 30, 2017. Tenant retention for
the Same-Property portfolio was 78% by GLA year-to-date, which
included approximately 1.3 million square feet of GLA of expiring
leases.
Credit Rated Tenants
Investment grade rated tenants as a percent of annualized base
rent was 47% as of September 30,
2017. Additionally, 61% of HTA's annualized base rent as of
September 30, 2017 was derived from
tenants that have (or whose parent companies have) a credit rating
from a nationally recognized rating agency.
In-House Property Management and Leasing Platform
As of September 30, 2017, HTA's
in-house property management and leasing platform operated
approximately 22.2 million square feet of GLA, or 92%, of HTA's
total portfolio.
Balance Sheet
As of September 30, 2017, HTA had
total assets of $6.4 billion, cash
and cash equivalents of $9.4 million,
and $919.5 million available under
its unsecured revolving credit facility (includes the impact of
$5.5 million of outstanding letters
of credit). The leverage ratio of debt to total
capitalization was 31.9% as of September 30,
2017.
About Healthcare Trust of America, Inc.
Healthcare Trust of America, Inc. (NYSE: HTA) is the largest
dedicated owner and operator of medical office buildings ("MOBs")
in the United States based on
gross leasable area ("GLA"). We provide the real estate
infrastructure for the integrated delivery of healthcare services
in highly desirable locations. Over the last decade, we have
invested $7.0 billion primarily in
MOBs and other healthcare assets comprising 24.2 million square
feet of GLA. Our investments are targeted in 20 to 25 key
markets that we believe have superior healthcare demographics that
support strong, long-term demand for medical office space. We
have achieved, and continue to achieve, critical mass within these
key markets by expanding our presence through accretive
acquisitions, and utilizing our in-house operating expertise
through our regionally located property management and leasing
platform.
Founded in 2006 and listed on the New York Stock Exchange in
2012, HTA has produced attractive returns for its stockholders that
we believe have significantly outperformed the S&P 500 and US
REIT indices. More information about HTA can be found on the
Company's website at www.htareit.com.
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 Wednesday, October 25, 2017 at 1:00 p.m. Eastern Time (10:00 a.m. Pacific Time) to review its financial
performance and operating results for the three and nine months
ended September 30, 2017.
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: 10112394
Available October 25, 2017 (one hour
after the end of the conference call) to November 1, 2017 at 1:00
p.m. Eastern Time (10:00 a.m. Pacific
Time)
Supplemental Information
Supplemental financial data are available on the HTA's website
at www.htareit.com.
Financial Contact:
Robert A. Milligan
Chief Financial Officer
480.998.3478
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In thousands,
except share data)
|
(Unaudited)
|
|
|
September 30,
2017
|
|
December 31,
2016
|
ASSETS
|
|
|
|
Real estate
investments:
|
|
|
|
Land
|
$
|
480,850
|
|
|
$
|
386,526
|
|
Building and
improvements
|
5,788,837
|
|
|
3,466,516
|
|
Lease
intangibles
|
648,591
|
|
|
467,571
|
|
Construction in
progress
|
59,573
|
|
|
—
|
|
|
6,977,851
|
|
|
4,320,613
|
|
Accumulated
depreciation and amortization
|
(973,566)
|
|
|
(817,593)
|
|
Real estate
investments, net
|
6,004,285
|
|
|
3,503,020
|
|
Investment in
unconsolidated joint venture
|
68,303
|
|
|
—
|
|
Cash and cash
equivalents
|
9,410
|
|
|
11,231
|
|
Restricted cash and
escrow deposits
|
17,469
|
|
|
13,814
|
|
Receivables and other
assets, net
|
206,030
|
|
|
173,461
|
|
Other intangibles,
net
|
108,025
|
|
|
46,318
|
|
Total
assets
|
$
|
6,413,522
|
|
|
$
|
3,747,844
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Liabilities:
|
|
|
|
Debt
|
$
|
2,856,758
|
|
|
$
|
1,768,905
|
|
Accounts payable and
accrued liabilities
|
159,070
|
|
|
105,034
|
|
Derivative financial
instruments - interest rate swaps
|
1,441
|
|
|
1,920
|
|
Security deposits,
prepaid rent and other liabilities
|
61,402
|
|
|
49,859
|
|
Intangible
liabilities, net
|
69,852
|
|
|
37,056
|
|
Total
liabilities
|
3,148,523
|
|
|
1,962,774
|
|
Commitments and
contingencies
|
|
|
|
Redeemable
noncontrolling interests
|
4,692
|
|
|
4,653
|
|
Equity:
|
|
|
|
Preferred stock,
$0.01 par value; 200,000,000 shares authorized; none issued and
outstanding
|
—
|
|
|
—
|
|
Class A common
stock, $0.01 par value; 1,000,000,000 shares authorized;
200,686,673 and 141,719,134 shares issued and outstanding as of
September 30, 2017 and December 31, 2016, respectively
|
2,007
|
|
|
1,417
|
|
Additional paid-in
capital
|
4,386,224
|
|
|
2,754,818
|
|
Accumulated other
comprehensive loss
|
(615)
|
|
|
—
|
|
Cumulative dividends
in excess of earnings
|
(1,212,051)
|
|
|
(1,068,961)
|
|
Total stockholders'
equity
|
3,175,565
|
|
|
1,687,274
|
|
Noncontrolling
interests
|
84,742
|
|
|
93,143
|
|
Total
equity
|
3,260,307
|
|
|
1,780,417
|
|
Total liabilities and
equity
|
$
|
6,413,522
|
|
|
$
|
3,747,844
|
|
|
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Revenues:
|
|
|
|
|
|
|
|
Rental
income
|
$
|
175,431
|
|
|
$
|
118,252
|
|
|
$
|
438,949
|
|
|
$
|
338,646
|
|
Interest and other
operating income
|
563
|
|
|
88
|
|
|
1,271
|
|
|
243
|
|
Total
revenues
|
175,994
|
|
|
118,340
|
|
|
440,220
|
|
|
338,889
|
|
Expenses:
|
|
|
|
|
|
|
|
Rental
|
56,331
|
|
|
36,885
|
|
|
138,874
|
|
|
105,299
|
|
General and
administrative
|
8,283
|
|
|
7,293
|
|
|
25,178
|
|
|
20,879
|
|
Transaction
|
261
|
|
|
1,122
|
|
|
5,618
|
|
|
4,997
|
|
Depreciation and
amortization
|
70,491
|
|
|
47,864
|
|
|
172,900
|
|
|
130,430
|
|
Impairment
|
—
|
|
|
—
|
|
|
5,093
|
|
|
—
|
|
Total
expenses
|
135,366
|
|
|
93,164
|
|
|
347,663
|
|
|
261,605
|
|
Income before
other income (expense)
|
40,628
|
|
|
25,176
|
|
|
92,557
|
|
|
77,284
|
|
Interest
expense:
|
|
|
|
|
|
|
|
Interest related to
derivative financial instruments
|
(264)
|
|
|
(552)
|
|
|
(827)
|
|
|
(1,856)
|
|
Gain (loss) on change
in fair value of derivative financial instruments, net
|
—
|
|
|
1,306
|
|
|
884
|
|
|
(2,144)
|
|
Total interest
related to derivative financial instruments, including net change
in fair value of derivative financial instruments
|
(264)
|
|
|
754
|
|
|
57
|
|
|
(4,000)
|
|
Interest related to
debt
|
(25,924)
|
|
|
(16,386)
|
|
|
(59,688)
|
|
|
(44,503)
|
|
Gain on sale of real
estate, net
|
—
|
|
|
—
|
|
|
3
|
|
|
4,212
|
|
Loss on
extinguishment of debt, net
|
(774)
|
|
|
(3,000)
|
|
|
(11,192)
|
|
|
(3,022)
|
|
Income from
unconsolidated joint venture
|
318
|
|
|
—
|
|
|
381
|
|
|
—
|
|
Other (expense)
income
|
(27)
|
|
|
95
|
|
|
(13)
|
|
|
220
|
|
Net
income
|
$
|
13,957
|
|
|
$
|
6,639
|
|
|
$
|
22,105
|
|
|
$
|
30,191
|
|
Net income
attributable to noncontrolling interests
|
(194)
|
|
|
(212)
|
|
|
(715)
|
|
|
(830)
|
|
Net income
attributable to common stockholders
|
$
|
13,763
|
|
|
$
|
6,427
|
|
|
$
|
21,390
|
|
|
$
|
29,361
|
|
Earnings per
common share - basic:
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders
|
$
|
0.07
|
|
|
$
|
0.05
|
|
|
$
|
0.12
|
|
|
$
|
0.22
|
|
Earnings per
common share - diluted:
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders
|
$
|
0.07
|
|
|
$
|
0.04
|
|
|
$
|
0.12
|
|
|
$
|
0.21
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
200,674
|
|
|
138,807
|
|
|
173,189
|
|
|
134,905
|
|
Diluted
|
204,795
|
|
|
143,138
|
|
|
177,410
|
|
|
138,314
|
|
Dividends declared
per common share
|
$
|
0.305
|
|
|
$
|
0.300
|
|
|
$
|
0.905
|
|
|
$
|
0.890
|
|
|
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(Unaudited)
|
|
|
Nine Months Ended
September 30,
|
|
2017
|
|
2016
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
22,105
|
|
|
$
|
30,191
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation,
amortization and other
|
169,057
|
|
|
128,728
|
|
Share-based
compensation expense
|
5,493
|
|
|
5,136
|
|
Bad debt
expense
|
635
|
|
|
508
|
|
Impairment
|
5,093
|
|
|
—
|
|
Income from
unconsolidated joint venture
|
(381)
|
|
|
—
|
|
Gain on sale of real
estate, net
|
(3)
|
|
|
(4,212)
|
|
Loss on
extinguishment of debt, net
|
11,192
|
|
|
3,022
|
|
Change in fair value
of derivative financial instruments
|
(884)
|
|
|
2,144
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Receivables and other
assets, net
|
(20,489)
|
|
|
(14,051)
|
|
Accounts payable and
accrued liabilities
|
29,566
|
|
|
3,598
|
|
Prepaid rent and
other liabilities
|
7,158
|
|
|
(6,807)
|
|
Net cash provided by
operating activities
|
228,542
|
|
|
148,257
|
|
Cash flows from
investing activities:
|
|
|
|
Investments in real
estate
|
(2,357,570)
|
|
|
(532,527)
|
|
Investment in
unconsolidated joint venture
|
(68,839)
|
|
|
—
|
|
Development of real
estate
|
(19,163)
|
|
|
—
|
|
Proceeds from the
sale of real estate
|
4,746
|
|
|
23,368
|
|
Capital
expenditures
|
(42,990)
|
|
|
(34,064)
|
|
Restricted cash,
escrow deposits and other assets
|
(3,655)
|
|
|
2,143
|
|
Net cash used in
investing activities
|
(2,487,471)
|
|
|
(541,080)
|
|
Cash flows from
financing activities:
|
|
|
|
Borrowings on
unsecured revolving credit facility
|
515,000
|
|
|
513,000
|
|
Payments on unsecured
revolving credit facility
|
(528,000)
|
|
|
(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
|
(75,444)
|
|
|
(98,453)
|
|
Deferred financing
costs
|
(16,902)
|
|
|
(3,039)
|
|
Debt extinguishment
costs
|
(10,391)
|
|
|
—
|
|
Security
deposits
|
1,932
|
|
|
862
|
|
Proceeds from
issuance of common stock
|
1,624,222
|
|
|
418,891
|
|
Repurchase and
cancellation of common stock
|
(3,413)
|
|
|
(2,425)
|
|
Dividends
paid
|
(145,877)
|
|
|
(116,655)
|
|
Distributions paid to
noncontrolling interest of limited partners
|
(4,019)
|
|
|
(2,724)
|
|
Redemption of
redeemable noncontrolling interest
|
—
|
|
|
(491)
|
|
Net cash provided by
financing activities
|
2,257,108
|
|
|
397,691
|
|
Net change in cash
and cash equivalents
|
(1,821)
|
|
|
4,868
|
|
Cash and cash
equivalents - beginning of period
|
11,231
|
|
|
13,070
|
|
Cash and cash
equivalents - end of period
|
$
|
9,410
|
|
|
$
|
17,938
|
|
|
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
NOI, CASH NOI AND
SAME-PROPERTY CASH NOI
|
(In
thousands)
|
(Unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Net income
|
$
|
13,957
|
|
|
$
|
6,639
|
|
|
$
|
22,105
|
|
|
$
|
30,191
|
|
General and
administrative expenses
|
8,283
|
|
|
7,293
|
|
|
25,178
|
|
|
20,879
|
|
Transaction expenses
(1)
|
261
|
|
|
1,122
|
|
|
5,618
|
|
|
4,997
|
|
Depreciation and
amortization expense
|
70,491
|
|
|
47,864
|
|
|
172,900
|
|
|
130,430
|
|
Impairment
|
—
|
|
|
—
|
|
|
5,093
|
|
|
—
|
|
Interest expense and
net change in fair value of derivative financial
instruments
|
26,188
|
|
|
15,632
|
|
|
59,631
|
|
|
48,503
|
|
Gain on sale of real
estate, net
|
—
|
|
|
—
|
|
|
(3)
|
|
|
(4,212)
|
|
Loss on
extinguishment of debt, net
|
774
|
|
|
3,000
|
|
|
11,192
|
|
|
3,022
|
|
Income from
unconsolidated joint venture
|
(318)
|
|
|
—
|
|
|
(381)
|
|
|
—
|
|
Other expense
(income)
|
27
|
|
|
(95)
|
|
|
13
|
|
|
(220)
|
|
NOI
|
$
|
119,663
|
|
|
$
|
81,455
|
|
|
$
|
301,346
|
|
|
$
|
233,590
|
|
NOI percentage
growth
|
46.9
|
%
|
|
|
|
29.0
|
%
|
|
|
|
|
|
|
|
|
|
|
NOI
|
$
|
119,663
|
|
|
$
|
81,455
|
|
|
$
|
301,346
|
|
|
$
|
233,590
|
|
Straight-line rent
adjustments, net
|
(3,009)
|
|
|
(1,161)
|
|
|
(5,834)
|
|
|
(3,636)
|
|
Amortization of
(below) and above market leases/leasehold interests, net and lease
termination fees
|
214
|
|
|
3
|
|
|
246
|
|
|
497
|
|
Cash NOI
|
$
|
116,868
|
|
|
$
|
80,297
|
|
|
$
|
295,758
|
|
|
$
|
230,451
|
|
Notes receivable
interest income
|
(503)
|
|
|
(68)
|
|
|
(1,089)
|
|
|
(68)
|
|
Non Same-Property
Cash NOI
|
(36,080)
|
|
|
(2,186)
|
|
|
(76,911)
|
|
|
(19,255)
|
|
Same-Property Cash
NOI (2)
|
$
|
80,285
|
|
|
$
|
78,043
|
|
|
$
|
217,758
|
|
|
$
|
211,128
|
|
Same-Property Cash
NOI percentage growth
|
2.9
|
%
|
|
|
|
3.1
|
%
|
|
|
|
|
|
|
|
|
|
|
(1)
|
For the three and
nine months ended September 30, 2017, transaction costs have been
adjusted to reflect the prospective presentation of the early
adoption of ASU 2017-01 as of January 1, 2017. For the nine months
ended September 30, 2017, transactions costs included $4.6 million
of compensation and severance payments to Duke employees pursuant
to the Duke purchase agreements in connection with the Duke
acquisition.
|
|
|
(2)
|
Same-Property
includes 338 and 296 buildings for the three and nine months ended
September 30, 2017 and 2016, 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 our 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 and (ii) amortization of
below and above market leases/leasehold interests.
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 our 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 properties
referred to as "Same-Property". Same-Property Cash NOI
excludes properties which have not been owned and operated by HTA
during the entire span of all periods presented, excluding
properties intended for disposition in the near term, notes
receivable interest income and 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 our 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
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Net income
attributable to common stockholders
|
$
|
13,763
|
|
|
$
|
6,427
|
|
|
$
|
21,390
|
|
|
$
|
29,361
|
|
Depreciation and
amortization expense related to investments in real
estate
|
70,021
|
|
|
47,545
|
|
|
171,678
|
|
|
129,477
|
|
Gain on sale of real
estate, net
|
—
|
|
|
—
|
|
|
(3)
|
|
|
(4,212)
|
|
Impairment
|
—
|
|
|
—
|
|
|
5,093
|
|
|
—
|
|
Proportionate share
of joint venture depreciation, amortization and other
adjustments
|
464
|
|
|
—
|
|
|
506
|
|
|
—
|
|
FFO attributable to
common stockholders
|
$
|
84,248
|
|
|
$
|
53,972
|
|
|
$
|
198,664
|
|
|
$
|
154,626
|
|
Transaction expenses
(1)
|
261
|
|
|
1,122
|
|
|
975
|
|
|
4,997
|
|
(Gain) loss on change
in fair value of derivative financial instruments, net
|
—
|
|
|
(1,306)
|
|
|
(884)
|
|
|
2,144
|
|
Loss on
extinguishment of debt, net
|
774
|
|
|
3,000
|
|
|
11,192
|
|
|
3,022
|
|
Noncontrolling income
from partnership units included in diluted shares
|
166
|
|
|
211
|
|
|
635
|
|
|
802
|
|
Other normalizing
items, net (2)
|
—
|
|
|
133
|
|
|
4,643
|
|
|
117
|
|
Normalized FFO
attributable to common stockholders
|
$
|
85,449
|
|
|
$
|
57,132
|
|
|
$
|
215,225
|
|
|
$
|
165,708
|
|
Other expense
(income)
|
27
|
|
|
(95)
|
|
|
13
|
|
|
(220)
|
|
Non-cash compensation
expense
|
1,654
|
|
|
2,103
|
|
|
5,493
|
|
|
5,136
|
|
Straight-line rent
adjustments, net
|
(3,009)
|
|
|
(1,161)
|
|
|
(5,834)
|
|
|
(3,636)
|
|
Amortization of
(below) and above market leases/leasehold interests and corporate
assets, net
|
683
|
|
|
323
|
|
|
1,467
|
|
|
1,476
|
|
Deferred revenue -
tenant improvement related
|
(12)
|
|
|
7
|
|
|
(23)
|
|
|
—
|
|
Amortization of
deferred financing costs and debt discount/premium, net
|
1,290
|
|
|
795
|
|
|
2,929
|
|
|
2,288
|
|
Recurring capital
expenditures, tenant improvements and leasing
commissions
|
(11,315)
|
|
|
(9,882)
|
|
|
(31,020)
|
|
|
(22,866)
|
|
Normalized FAD
attributable to common stockholders
|
$
|
74,767
|
|
|
$
|
49,222
|
|
|
$
|
188,250
|
|
|
$
|
147,886
|
|
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders per diluted share
|
$
|
0.07
|
|
|
$
|
0.04
|
|
|
$
|
0.12
|
|
|
$
|
0.21
|
|
FFO adjustments per
diluted share, net
|
0.34
|
|
|
0.34
|
|
|
1.00
|
|
|
0.91
|
|
FFO attributable to
common stockholders per diluted share
|
$
|
0.41
|
|
|
$
|
0.38
|
|
|
$
|
1.12
|
|
|
$
|
1.12
|
|
Normalized FFO
adjustments per diluted share, net
|
0.01
|
|
|
0.02
|
|
|
0.09
|
|
|
0.08
|
|
Normalized FFO
attributable to common stockholders per diluted share
|
$
|
0.42
|
|
|
$
|
0.40
|
|
|
$
|
1.21
|
|
|
$
|
1.20
|
|
|
|
|
|
|
|
|
|
Weighted average
diluted common shares outstanding
|
204,795
|
|
|
143,138
|
|
|
177,410
|
|
|
138,314
|
|
|
|
|
|
|
|
|
|
(1)
|
For the three and
nine months ended September 30, 2017, amounts have been adjusted to
reflect the prospective presentation of the early adoption of ASU
2017-01 as of January 1, 2017.
|
|
|
(2)
|
For the nine months
ended September 30, 2017, other normalizing items include $4.6
million of compensation and severance payments to Duke employees
pursuant to the Duke purchase agreements in connection with the
Duke acquisition that were included in transaction expenses on
HTA's condensed consolidated statements of operations. In addition,
other normalizing items excludes lease termination fees as they are
deemed to be generated in the ordinary course of
business.
|
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. HTA presents this non-GAAP financial measure
because it considers it an important supplemental measure of its
operating performance and believes it is 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. 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
partnership units included in diluted shares; and (v) other
normalizing items, which include items that are unusual and
infrequent in nature. HTA presents this non-GAAP financial
measure because it allows for the comparison of our operating
performance to other REITs and between periods on a consistent
basis. 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. Normalized
FFO 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 our financial performance, nor is it
indicative of cash available to fund cash needs. Normalized
FFO should be reviewed in connection with other GAAP
measurements.
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 our 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 our financial performance, nor is it
indicative of cash available to fund cash needs. Normalized
FAD should be reviewed in connection with other GAAP
measurements.
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SOURCE Healthcare Trust of America, Inc.