SCOTTSDALE, Ariz.,
Oct. 28, 2019 /PRNewswire/ -- Healthcare Trust of
America, Inc. (NYSE: HTA) ("HTA") announced results for the three
and nine months ended September 30,
2019.
HTA's Q3 2019 results consist of a net loss attributable to
common stockholders of $(0.04) per
diluted share, which included a ($0.10) per share charge related to the
refinancing of the 2021 and 2022 Senior Notes, Normalized FFO of
$0.42 per diluted share, and
Same-Property Cash NOI growth of 2.5%. In the quarter, HTA
completed $135.5 million in
acquisitions, announced two new developments totaling $90.0 million, and refinanced $900.0 million in debt at 3.05% per annum blended
interest rates. As a result of this performance, HTA is adjusting
its EPS guidance to account for the debt extinguishment costs,
while reiterating its normalized FFO guidance, increasing its
midpoint for full year same store growth, and increasing the volume
of acquisitions as outlined below.
"In the third quarter, HTA demonstrated its ability to drive
both internal and external growth while strengthening its fortress
balance sheet and positioning itself for the future," stated
Chairman, CEO and President Scott D.
Peters. "Our operating results demonstrate the power of our
company. We have a best-in-class portfolio concentrated in
key markets, and an operating platform that can create value for
our tenants and shareholders through operations, development, and
acquisitions."
Highlights
Third Quarter 2019:
- Net (Loss) Attributable to Common Stockholders was
$(8.5) million, or $(0.04) per diluted share, including a
$21.6 million, or $(0.10) per diluted share, loss related to the
extinguishment of debt. This compares to $173.0 million, or $0.82 per diluted share, including a $166.4 million, or $0.79 per diluted share, gain on sale of real
estate in Q3 2018.
- Funds From Operations ("FFO"), as defined by the
National Association of Real Estate Investment Trusts ("NAREIT"),
was $65.0 million, or $0.31 per diluted share, for Q3 2019. Due to the
adoption of Topic 842, initial direct costs are now reported in
general and administrative expenses. For Q3 2018, HTA capitalized
approximately $1.5 million of initial
direct costs.
- Normalized FFO was $87.1
million, or $0.42 per diluted
share, for Q3 2019.
- Normalized Funds Available for Distribution ("FAD") was
$70.9 million for Q3 2019.
- Same-Property Cash Net Operating Income ("NOI")
increased $2.8 million, or 2.5%, to
$113.2 million, compared to Q3
2018.
- Leasing: HTA's portfolio had a leased rate of 90.6% by
gross leasable area ("GLA") and an occupancy rate of 89.7% by GLA
for Q3 2019. During Q3 2019, HTA executed approximately 0.7 million
square feet of GLA of new and renewal leases. Re-leasing spreads
increased to 2.7% and tenant retention for the Same-Property
portfolio was 86% by GLA for Q3 2019.
Year-to-Date 2019:
- Net Income Attributable to Common Stockholders was
$21.2 million, or $0.10 per diluted share, a decrease of
$(0.84) per diluted share, compared
to 2018.
- FFO, as defined by NAREIT, was $232.5 million, or $1.11 per diluted share, for 2019. For 2018, HTA
capitalized approximately $3.7
million of initial direct costs.
- Normalized FFO was $255.4
million, or $1.22 per diluted
share, for 2019.
- Normalized FAD was $217.2
million for 2019.
- Same-Property Cash NOI increased $9.0 million, or 2.7%, to $336.1 million, compared to 2018.
- Leasing: During the nine months ended September 30, 2019, HTA executed approximately
2.6 million square feet of GLA of new and renewal leases, or over
11.0% of the total GLA of its portfolio. Re-leasing spreads
increased to 3.6% and tenant retention for the Same-Property
portfolio was 85% by GLA year-to-date.
Balance Sheet and Capital Markets
- Balance Sheet: HTA ended Q3 2019 with total liquidity of
$1.0 billion, inclusive of
$12.7 million of cash and cash
equivalents. HTA also had total leverage of (i) 30.0%, measured as
debt less cash and cash equivalents to total capitalization, and
(ii) 5.7x, measured as debt less cash and cash equivalents to
Adjusted Earnings before Interest, Taxes, Depreciation and
Amortization for real estate ("Adjusted EBITDAre").
- Equity: In September 2019,
HTA settled its forward equity sale under its at-the-market ("ATM")
offering program in June 2019. As
part of this sale, HTA issued approximately 1.8 million shares of
common stock and received net proceeds of approximately
$51.8 million, adjusted for costs to
borrow.
- Debt: In September 2019,
Healthcare Trust of America Holdings, LP ("HTALP") and HTA issued
$900.0 million in senior, unsecured
notes with a weighted average interest rate of 3.04% per annum and
a weighted maturity of 9.5 years. The issuance included
$650.0 million in new 3.10% Senior
Notes due 2030, and an additional issuance of $250.0 million in HTA's existing 3.50% Senior
Notes due 2026 at a yield to maturity of 2.89%. Net proceeds from
the issuance were used to redeem the $300.0
million in 3.375% Senior Notes due 2021 and the $400.0 million in 2.95% Senior Notes due 2022,
and to pay down the unsecured revolving credit facility. As part of
these repayments, HTA incurred debt extinguishment costs of
approximately $21.6 million.
Noteworthy 2019 Activities
- Investments: In the quarter, HTA closed on approximately
$128.5 million of investments
totaling approximately 296,000 square feet of GLA, with expected
year-one contractual yields of approximately 5.6%, before operating
synergies. These investments are approximately 95% occupied and are
primarily located in HTA's existing key markets. HTA also closed on
a parcel of land adjacent to its Pavilion III MOB development for
$7.0 million. The Q3 2019
acquisitions are highlighted by the following:
-
- Third Street Medical Center: A Class A on-campus medical office
building ("MOB") located adjacent to the St. Vincent's Medical
Center in the heart of downtown Los
Angeles, CA. We acquired the 147,000 square foot MOB in
August for $85.0 million. It is
approximately 90% leased and will be operated by HTA's internal
asset management platform. The building includes well-respected
tenants including UCLA Health, Children's Hospital Los Angeles, and
internationally renowned House Ear Institute.
- For the year, HTA has now closed on $221
million of investments and a land purchase of $7.0 million totaling approximately 559,000
square feet of GLA, with expected year-one contractual yields of
approximately 5.8%, before operating synergies. These properties
were approximately 91% occupied as of closing, and are located
within HTA's key markets. Over 70% of these properties are located
on or adjacent to hospital campuses, and, all were acquired on a
fee-simple basis.
- In addition, as of October 28,
2019, HTA has an additional $199
million of investments that have closed or are under
exclusive contract, which are subject to customary closing
conditions.
- Developments: In September
2019, HTA reached agreements to develop two new on-campus
MOBs with anticipated costs of approximately $85 - $90 million
totaling approximately 190,000 square feet of GLA. The new
development projects are expected to be more than 73% pre-leased
with anticipated yields over 6.5%. These projects include the
following:
-
- Pavilion III MOB (Dallas, TX).
A Class A MOB located on the new Medical City Heart Hospital and
Spine Hospital campus (formerly Forest
Park) totaling approximately 107,000 square feet of GLA.
Construction is expected to begin in Q4 2019 and is expected to be
completed by Q1 2021 at an anticipated cost of approximately
$55 - $60
million, including structured parking. This fee-simple
development will support the recent expansion of this health system
campus that will provide leading cardiac and orthopedic services to
Dallas.
- Memorial Hospital MOB (Bakersfield,
CA). A Class A MOB with 84,000 square feet of GLA located on
CommonSpirit's (formerly Dignity) Memorial Hospital in Bakersfield, CA. This development project is
expected to cost approximately $30
million, with construction expected to begin in Q4 2019 with
completion expected by Q1 2021. This development will expand HTA's
relationship with CommonSpirit to a 10th hospital campus.
- Redevelopments: HTA announced plans to re-develop two of
its MOBs on its St. Joseph Health - Mission Viejo campus in Mission Viejo, CA. These fee-simple MOBs total
approximately 105,000 square feet of GLA and were originally built
in the early 1970's. HTA will invest up to $12.5 million over the next 12 - 18 months to
modernize the buildings, with expected returns of between 8 - 12%
on incremental capital.
- Dividends: On October 28,
2019, HTA's Board of Directors announced a quarterly cash
dividend of $0.315 per share of
common stock and per OP Unit. The quarterly dividend is to be paid
on January 9, 2020 to stockholders of
record of its common stock and holders of its OP Units on
January 2, 2020.
Impact of 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 were capitalized
in accordance with certain criteria provided for in the applicable
guidance. Topic 842 also eliminates the accounting
recognition of expenses paid directly by tenants and moves certain
bad debt costs from expense to revenue. During the three and
nine months ended Q3 2018, HTA capitalized $1.5 million and $3.7
million, respectively, of initial direct costs that would
now be expensed under Topic 842. In addition, for the three
and nine months ended Q3 2018, HTA recognized $3.5 million and $10.5
million, respectively, of tenant paid property taxes in both
revenues and expenses and a nominal amount of bad debt costs
recognized as expenses.
2019 Guidance
For 2019, HTA updated its earnings, same-property cash NOI
growth, and FFO per share, as defined by NAREIT, guidance as
outlined below:
|
|
Annual
Expectations
|
|
|
Low
|
to
|
High
|
Net income
attributable to common stockholders per share
|
|
$0.17
|
|
$0.20
|
|
|
|
|
|
Same-Property Cash
NOI
|
|
2.4%
|
|
2.8%
|
|
|
|
|
|
FFO per share, as
defined by NAREIT
|
|
$1.51
|
|
$1.53
|
|
|
|
|
|
Normalized FFO per
share
|
|
$1.63
|
|
$1.65
|
The changes to net income and NAREIT FFO reflect the debt
extinguishment costs incurred in the third quarter. In addition,
HTA now expects to complete $375 to
$425 million of investments in 2019
at average yields between 5.5% and 6.0%.
Subsequent Events
In October 2019, under its ATM
offering program, HTA entered into a forward sale arrangement in
which it would issue approximately 6.0 million shares of common
stock to receive anticipated net proceeds of approximately
$172.7 million prior to October 2020, subject to adjustments as provided
in the forward equity agreement. We anticipate using these net
proceeds to fund purchases of additional MOBs and for general
corporate purposes.
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
23.7 million square feet of GLA, with $7.0
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 index. 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 2018 Annual
Report on Form 10-K and in our filings with the SEC.
Conference Call
HTA will host a conference call and webcast on Tuesday, October 29, 2019 at 12:00 p.m. Eastern Time (9:00 a.m. Pacific Time) to review its financial
performance and operating results for the three and nine months
ended September 30, 2019.
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: 10135781
Available October 29, 2019 (one hour
after the end of the conference call) to November 29, 2019 at 12:00
p.m. Eastern Time (9:00 a.m. Pacific
Time)
Financial Contact:
Robert A. Milligan
Chief Financial Officer
480.998.3478
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In thousands,
except for share and per share data)
|
(Unaudited)
|
|
|
|
September 30,
2019
|
|
December 31,
2018
|
ASSETS
|
|
|
|
|
Real estate
investments:
|
|
|
|
|
Land
|
|
$
|
513,946
|
|
|
$
|
481,871
|
|
Building and
improvements
|
|
6,003,172
|
|
|
5,787,152
|
|
Lease
intangibles
|
|
606,946
|
|
|
599,864
|
|
Construction in
progress
|
|
19,159
|
|
|
4,903
|
|
|
|
7,143,223
|
|
|
6,873,790
|
|
Accumulated
depreciation and amortization
|
|
(1,390,752)
|
|
|
(1,208,169)
|
|
Real estate
investments, net
|
|
5,752,471
|
|
|
5,665,621
|
|
Investment in
unconsolidated joint venture
|
|
66,348
|
|
|
67,172
|
|
Cash and cash
equivalents
|
|
12,748
|
|
|
126,221
|
|
Restricted
cash
|
|
5,068
|
|
|
7,309
|
|
Receivables and other
assets, net
|
|
230,163
|
|
|
223,415
|
|
Right-of-use assets,
net
|
|
244,024
|
|
|
—
|
|
Other intangibles,
net
|
|
12,176
|
|
|
98,738
|
|
Total
assets
|
|
$
|
6,322,998
|
|
|
$
|
6,188,476
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Liabilities:
|
|
|
|
|
Debt
|
|
$
|
2,665,691
|
|
|
$
|
2,541,232
|
|
Accounts payable and
accrued liabilities
|
|
157,939
|
|
|
185,073
|
|
Derivative financial
instruments - interest rate swaps
|
|
1,152
|
|
|
—
|
|
Security deposits,
prepaid rent and other liabilities
|
|
43,036
|
|
|
59,567
|
|
Lease
liabilities
|
|
200,945
|
|
|
—
|
|
Intangible
liabilities, net
|
|
39,766
|
|
|
61,146
|
|
Total
liabilities
|
|
3,108,529
|
|
|
2,847,018
|
|
Commitments and
contingencies
|
|
|
|
|
Redeemable
noncontrolling interests
|
|
—
|
|
|
6,544
|
|
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;
207,186,452 and 205,267,349 shares issued and outstanding as of
September 30, 2019 and December 31, 2018, respectively
|
|
2,072
|
|
|
2,053
|
|
Additional paid-in
capital
|
|
4,581,176
|
|
|
4,525,969
|
|
Accumulated other
comprehensive income
|
|
1,798
|
|
|
307
|
|
Cumulative dividends
in excess of earnings
|
|
(1,443,360)
|
|
|
(1,272,305)
|
|
Total stockholders'
equity
|
|
3,141,686
|
|
|
3,256,024
|
|
Noncontrolling
interests
|
|
72,783
|
|
|
78,890
|
|
Total
equity
|
|
3,214,469
|
|
|
3,334,914
|
|
Total liabilities and
equity
|
|
$
|
6,322,998
|
|
|
$
|
6,188,476
|
|
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,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Revenues:
|
|
|
|
|
|
|
|
Rental
income
|
$
|
174,844
|
|
|
$
|
175,038
|
|
|
$
|
515,328
|
|
|
$
|
523,826
|
|
Interest and other
operating income
|
160
|
|
|
97
|
|
|
399
|
|
|
302
|
|
Total
revenues
|
175,004
|
|
|
175,135
|
|
|
515,727
|
|
|
524,128
|
|
Expenses:
|
|
|
|
|
|
|
|
Rental
|
53,807
|
|
|
55,789
|
|
|
158,213
|
|
|
165,364
|
|
General and
administrative
|
9,788
|
|
|
8,770
|
|
|
31,157
|
|
|
26,281
|
|
Transaction
|
522
|
|
|
346
|
|
|
858
|
|
|
933
|
|
Depreciation and
amortization
|
73,820
|
|
|
70,568
|
|
|
211,730
|
|
|
210,064
|
|
Interest
expense
|
24,625
|
|
|
24,834
|
|
|
72,601
|
|
|
77,392
|
|
Impairment
|
—
|
|
|
4,281
|
|
|
—
|
|
|
8,887
|
|
Total
expenses
|
162,562
|
|
|
164,588
|
|
|
474,559
|
|
|
488,921
|
|
Gain (loss) on sale
of real estate, net
|
—
|
|
|
166,372
|
|
|
(37)
|
|
|
166,372
|
|
Loss on
extinguishment of debt, net
|
(21,646)
|
|
|
(1,092)
|
|
|
(21,646)
|
|
|
(1,092)
|
|
Income from
unconsolidated joint venture
|
422
|
|
|
432
|
|
|
1,456
|
|
|
1,405
|
|
Other
income
|
205
|
|
|
89
|
|
|
781
|
|
|
129
|
|
Net (loss)
income
|
$
|
(8,577)
|
|
|
$
|
176,348
|
|
|
$
|
21,722
|
|
|
$
|
202,021
|
|
Net loss (income)
attributable to noncontrolling interests
|
114
|
|
|
(3,362)
|
|
|
(486)
|
|
|
(3,887)
|
|
Net (loss) income
attributable to common stockholders
|
$
|
(8,463)
|
|
|
$
|
172,986
|
|
|
$
|
21,236
|
|
|
$
|
198,134
|
|
Earnings per
common share - basic:
|
|
|
|
|
|
|
|
Net (loss) income
attributable to common stockholders
|
$
|
(0.04)
|
|
|
$
|
0.83
|
|
|
$
|
0.10
|
|
|
$
|
0.96
|
|
Earnings per
common share - diluted:
|
|
|
|
|
|
|
|
Net (loss) income
attributable to common stockholders
|
$
|
(0.04)
|
|
|
$
|
0.82
|
|
|
$
|
0.10
|
|
|
$
|
0.94
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
205,277
|
|
|
207,513
|
|
|
205,156
|
|
|
205,950
|
|
Diluted
|
205,277
|
|
|
211,444
|
|
|
209,026
|
|
|
209,968
|
|
Dividends declared
per common share
|
$
|
0.315
|
|
|
$
|
0.310
|
|
|
$
|
0.935
|
|
|
$
|
0.920
|
|
HEALTHCARE TRUST
OF AMERICA, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(Unaudited)
|
|
|
Nine Months Ended
September 30,
|
|
2019
|
|
2018
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
21,722
|
|
|
$
|
202,021
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
203,392
|
|
|
203,550
|
|
Share-based
compensation expense
|
7,828
|
|
|
7,830
|
|
Impairment
|
—
|
|
|
8,887
|
|
Income from
unconsolidated joint venture
|
(1,456)
|
|
|
(1,405)
|
|
Distributions from
unconsolidated joint venture
|
2,225
|
|
|
1,680
|
|
Loss (gain) on sale
of real estate, net
|
37
|
|
|
(166,372)
|
|
Loss on
extinguishment of debt, net
|
21,646
|
|
|
1,092
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Receivables and other
assets, net
|
(2,148)
|
|
|
(7,820)
|
|
Accounts payable and
accrued liabilities
|
(19,783)
|
|
|
(5,932)
|
|
Prepaid rent and
other liabilities
|
4,919
|
|
|
(2,780)
|
|
Net cash provided by
operating activities
|
238,382
|
|
|
240,751
|
|
Cash flows from
investing activities:
|
|
|
|
Investments in real
estate
|
(223,168)
|
|
|
(17,389)
|
|
Development of real
estate
|
(14,253)
|
|
|
(29,593)
|
|
Proceeds from the
sale of real estate
|
1,193
|
|
|
302,440
|
|
Capital
expenditures
|
(59,533)
|
|
|
(61,136)
|
|
Collection of real
estate notes receivable
|
551
|
|
|
524
|
|
Net cash (used in)
provided by investing activities
|
(295,210)
|
|
|
194,846
|
|
Cash flows from
financing activities:
|
|
|
|
Borrowings on
unsecured revolving credit facility
|
365,000
|
|
|
145,000
|
|
Payments on unsecured
revolving credit facility
|
(350,000)
|
|
|
(145,000)
|
|
Proceeds from
unsecured senior notes
|
906,927
|
|
|
—
|
|
Payments on unsecured
senior notes
|
(700,000)
|
|
|
—
|
|
Payments on secured
mortgage loans
|
(96,765)
|
|
|
(173,212)
|
|
Deferred financing
costs
|
(6,954)
|
|
|
(782)
|
|
Debt extinguishment
costs
|
(18,383)
|
|
|
(1,909)
|
|
Security
deposits
|
—
|
|
|
499
|
|
Proceeds from
issuance of common stock
|
51,804
|
|
|
72,814
|
|
Issuance of operating
partnership units
|
—
|
|
|
411
|
|
Repurchase and
cancellation of common stock
|
(12,159)
|
|
|
(19,431)
|
|
Dividends
paid
|
(190,853)
|
|
|
(188,414)
|
|
Distributions paid to
noncontrolling interest of limited partners
|
(7,503)
|
|
|
(3,976)
|
|
Net cash used in
financing activities
|
(58,886)
|
|
|
(314,000)
|
|
Net change in cash,
cash equivalents and restricted cash
|
(115,714)
|
|
|
121,597
|
|
Cash, cash
equivalents and restricted cash - beginning of
period
|
133,530
|
|
|
118,560
|
|
Cash, cash
equivalents and restricted cash - end of period
|
$
|
17,816
|
|
|
$
|
240,157
|
|
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,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net (loss)
income
|
$
|
(8,577)
|
|
|
$
|
176,348
|
|
|
$
|
21,722
|
|
|
$
|
202,021
|
|
General and
administrative expenses
|
9,788
|
|
|
8,770
|
|
|
31,157
|
|
|
26,281
|
|
Transaction
expenses
|
522
|
|
|
346
|
|
|
858
|
|
|
933
|
|
Depreciation and
amortization expense
|
73,820
|
|
|
70,568
|
|
|
211,730
|
|
|
210,064
|
|
Impairment
|
—
|
|
|
4,281
|
|
|
—
|
|
|
8,887
|
|
Interest
expense
|
24,625
|
|
|
24,834
|
|
|
72,601
|
|
|
77,392
|
|
(Gain) loss on sale
of real estate, net
|
—
|
|
|
(166,372)
|
|
|
37
|
|
|
(166,372)
|
|
Loss on
extinguishment of debt, net
|
21,646
|
|
|
1,092
|
|
|
21,646
|
|
|
1,092
|
|
Income from
unconsolidated joint venture
|
(422)
|
|
|
(432)
|
|
|
(1,456)
|
|
|
(1,405)
|
|
Other
income
|
(205)
|
|
|
(89)
|
|
|
(781)
|
|
|
(129)
|
|
NOI
|
$
|
121,197
|
|
|
$
|
119,346
|
|
|
$
|
357,514
|
|
|
$
|
358,764
|
|
NOI percentage
growth
|
1.6
|
%
|
|
|
|
(0.3)
|
%
|
|
|
|
|
|
|
|
|
|
|
NOI
|
$
|
121,197
|
|
|
$
|
119,346
|
|
|
$
|
357,514
|
|
|
$
|
358,764
|
|
Straight-line rent
adjustments, net
|
(2,539)
|
|
|
(2,746)
|
|
|
(8,261)
|
|
|
(8,289)
|
|
Amortization of
(below) and above market leases/leasehold interests, net and other
GAAP adjustments
|
(1,017)
|
|
|
(66)
|
|
|
(1,140)
|
|
|
74
|
|
Notes receivable
interest income
|
(23)
|
|
|
(32)
|
|
|
(75)
|
|
|
(102)
|
|
Cash NOI
|
$
|
117,618
|
|
|
$
|
116,502
|
|
|
$
|
348,038
|
|
|
$
|
350,447
|
|
Acquisitions not
owned/operated for all periods presented and disposed properties
Cash NOI
|
(2,449)
|
|
|
(2,918)
|
|
|
(5,154)
|
|
|
(13,384)
|
|
Redevelopment Cash
NOI
|
(527)
|
|
|
(1,671)
|
|
|
(2,479)
|
|
|
(5,176)
|
|
Intended for sale
Cash NOI
|
(1,436)
|
|
|
(1,458)
|
|
|
(4,342)
|
|
|
(4,799)
|
|
Same-Property Cash
NOI (1)
|
$
|
113,206
|
|
|
$
|
110,455
|
|
|
$
|
336,063
|
|
|
$
|
327,088
|
|
Same-Property Cash
NOI percentage growth
|
2.5
|
%
|
|
|
|
2.7
|
%
|
|
|
|
|
|
|
|
|
|
|
(1) Same-Property
includes 407 and 405 buildings for the three and nine months ended
September 30, 2019 and 2018, 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 HTA's 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 and other GAAP
adjustments; and (iii) notes receivable interest income.
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)
are 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
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net (loss) income
attributable to common stockholders
|
$
|
(8,463)
|
|
|
$
|
172,986
|
|
|
$
|
21,236
|
|
|
$
|
198,134
|
|
Depreciation and
amortization expense related to investments in real
estate
|
73,042
|
|
|
70,004
|
|
|
209,814
|
|
|
208,445
|
|
(Gain) loss on sale
of real estate, net
|
—
|
|
|
(166,372)
|
|
|
37
|
|
|
(166,372)
|
|
Impairment
|
—
|
|
|
4,281
|
|
|
—
|
|
|
8,887
|
|
Proportionate share
of joint venture depreciation and amortization
|
468
|
|
|
463
|
|
|
1,390
|
|
|
1,277
|
|
FFO attributable to
common stockholders
|
$
|
65,047
|
|
|
$
|
81,362
|
|
|
$
|
232,477
|
|
|
$
|
250,371
|
|
Transaction
expenses
|
522
|
|
|
346
|
|
|
858
|
|
|
789
|
|
Loss on
extinguishment of debt, net
|
21,646
|
|
|
1,092
|
|
|
21,646
|
|
|
1,092
|
|
Noncontrolling income
from OP units included in diluted shares
|
(114)
|
|
|
3,344
|
|
|
420
|
|
|
3,822
|
|
Other normalizing
items, net
|
—
|
|
|
—
|
|
|
—
|
|
|
144
|
|
Normalized FFO
attributable to common stockholders
|
$
|
87,101
|
|
|
$
|
86,144
|
|
|
$
|
255,401
|
|
|
$
|
256,218
|
|
Non-cash compensation
expense
|
2,337
|
|
|
2,127
|
|
|
7,828
|
|
|
7,830
|
|
Straight-line rent
adjustments, net
|
(2,539)
|
|
|
(2,746)
|
|
|
(8,261)
|
|
|
(8,289)
|
|
Amortization of
(below) and above market leases/leasehold interests and corporate
assets, net
|
(612)
|
|
|
499
|
|
|
45
|
|
|
1,809
|
|
Deferred revenue -
tenant improvement related and other income
|
(1)
|
|
|
(90)
|
|
|
(4)
|
|
|
(199)
|
|
Amortization of
deferred financing costs and debt discount/premium, net
|
1,469
|
|
|
1,277
|
|
|
4,281
|
|
|
3,857
|
|
Recurring capital
expenditures, tenant improvements and leasing
commissions
|
(16,876)
|
|
|
(18,397)
|
|
|
(42,140)
|
|
|
(44,258)
|
|
Normalized FAD
attributable to common stockholders
|
$
|
70,879
|
|
|
$
|
68,814
|
|
|
$
|
217,150
|
|
|
$
|
216,968
|
|
|
|
|
|
|
|
|
|
Net (loss) income
attributable to common stockholders per diluted share
|
$
|
(0.04)
|
|
|
$
|
0.82
|
|
|
$
|
0.10
|
|
|
$
|
0.94
|
|
FFO adjustments per
diluted share, net
|
0.35
|
|
|
(0.44)
|
|
|
1.01
|
|
|
0.25
|
|
FFO attributable to
common stockholders per diluted share
|
$
|
0.31
|
|
|
$
|
0.38
|
|
|
$
|
1.11
|
|
|
$
|
1.19
|
|
Normalized FFO
adjustments per diluted share, net
|
0.11
|
|
|
0.03
|
|
|
0.11
|
|
|
0.03
|
|
Normalized FFO
attributable to common stockholders per diluted share
|
$
|
0.42
|
|
|
$
|
0.41
|
|
|
$
|
1.22
|
|
|
$
|
1.22
|
|
|
|
|
|
|
|
|
|
Weighted average
diluted common shares outstanding
|
209,072
|
|
|
211,444
|
|
|
209,026
|
|
|
209,968
|
|
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 extinguishment of debt;
(iii) noncontrolling income or loss from OP Units included in
diluted shares; and (iv) 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) non-cash compensation expense; (ii) straight-line rent
adjustments; (iii) amortization of below and above market
leases/leasehold interests and corporate assets; (iv) deferred
revenue - tenant improvement related and other income; (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
|
|
September 30,
2019
|
Net income
|
$
|
(8,577)
|
|
Interest
expense
|
24,625
|
|
Depreciation and
amortization expense
|
73,820
|
|
Proportionate share
of joint venture depreciation and amortization
|
468
|
|
EBITDAre
|
$
|
90,336
|
|
Transaction
expenses
|
522
|
|
Loss on
extinguishment of debt, net
|
21,646
|
|
Non-cash compensation
expense
|
2,337
|
|
Pro forma impact of
acquisitions
|
950
|
|
Adjusted
EBITDAre
|
$
|
115,791
|
|
|
|
Adjusted
EBITDAre, annualized
|
$
|
463,164
|
|
|
|
As of September 30,
2019:
|
|
Debt
|
$
|
2,665,691
|
|
Less: cash and cash
equivalents
|
12,748
|
|
Net Debt
|
$
|
2,652,943
|
|
|
|
Net Debt to Adjusted
EBITDAre
|
5.7
|
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; (iv) impairment; (v) gain or loss on
the sale of real estate; and (vi) and the proportionate share of
joint venture depreciation and amortization.
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.