Brookfield Property Partners L.P. (NASDAQ: BPY; NASDAQ: BPR; TSX:
BPY.UN) (“BPY”) today announced financial results for the quarter
ended June 30, 2019.
“In the second quarter, we achieved earnings
growth of 6% and were active in monetizing mature, de-risked
assets,” said Brian Kingston, Chief Executive
Officer. “We have continued to allocate additional capital to unit
repurchases this year, acquiring over $450 million year-to-date. We
continue to believe our units represent the highest-returning
investment opportunity available to us today.”
Financial Results
|
Three months endedJune 30, |
|
Six months ended June 30, |
(US$ Millions, except
per unit amounts) |
2019 |
2018 |
|
2019 |
|
2018 |
Net
income(1) |
$ |
23 |
$ |
1,051 |
$ |
736 |
$ |
2,074 |
Company FFO and realized gains(2) |
$ |
362 |
$ |
250 |
$ |
729 |
$ |
519 |
Net income per LP unit(3)(4) |
$ |
0.12 |
$ |
0.69 |
$ |
0.44 |
$ |
1.38 |
Company FFO and
realized gains per unit(4)(5) |
$ |
0.38 |
$ |
0.36 |
$ |
0.76 |
$ |
0.74 |
(1) |
Consolidated basis – includes amounts attributable to
non-controlling interests. |
(2) |
Excluding realized gains, Company
FFO was $335 million compared with $246 million in the prior year
period. See "Basis of Presentation" and “Reconciliation of Non-IFRS
Measures” in this press release for the definition and
components. |
(3) |
Represents basic net income
attributable to holders of LP units. IFRS requires the inclusion of
preferred shares that are mandatorily convertible into LP units at
a price of $25.70 without an add-back to earnings of the associated
carry on the preferred shares. |
(4) |
Net income attributable to
holders of LP units and Company FFO and realized gains per unit are
reduced by preferred dividends of $3 million for the three and six
months ended June 30, 2019, respectively in determining per unit
amounts. |
(5) |
Company FFO and realized gains
per unit are calculated based on 952.1 million (2018 – 703.1
million) and 961.4 million (2018 – 703.3 million) units outstanding
for the three and six months ended June 30, 2019. Excluding
realized gains, Company FFO per unit was $0.35, consistent with the
prior year period. See reconciliation of basic net income in the
"Reconciliation of Non-IFRS Measures" section in this press
release. |
Company FFO and realized gains was $362 million
($0.38 per unit) for the quarter ended June 30, 2019, compared to
$250 million ($0.36 per unit) for the same period in 2018. The
increase is attributable to higher realized gains in our LP
investments segment, same-property growth in our Core Office
business, and earnings from new capital invested in our Core Retail
business.
Net income for the quarter ended June 30, 2019
was $23 million ($0.12 per LP unit) versus $1,051 million ($0.69
per LP unit) for the same period in 2018. The decrease is primarily
attributable to higher valuation gains recognized in the prior-year
period.
Operating Highlights
Our Core Office operations generated Company FFO
of $187 million for the quarter ended June 30, 2019 compared to
$149 million in the same period in 2018. The business generated 3%
same-property NOI growth and fee income of $64 million, which
was $44 million higher than in the prior period. The increase in
Company FFO over the prior year is primarily due to same-property
growth and a performance-based fee at Five Manhattan West,
partially offset by asset sales, higher interest rates and a
stronger U.S. dollar.
Occupancy in our Core Office portfolio finished
the second quarter at 92.4% on 1.2 million square feet of total
leasing, representing decreases in occupancy of 30 basis points
year-over-year and 90 basis points sequentially driven primarily by
expiries in New York and London. Leases signed in the second
quarter were at rents 25% higher on average than leases that
expired in the period.
Our Core Retail operations generated Company FFO
of $170 million for the quarter ended June 30, 2019 compared to
$119 million in the comparable period in 2018. The increase over
the prior year reporting period is attributable to the acquisition
of GGP in the third quarter of 2018. After adjusting for the
temporary incremental impact of recent bankruptcies, which for the
current quarter reduced NOI by $7.7 million and on a year to date
basis by $13.9 million, same store NOI increased by 0.4% and 1.7%
for the quarter and year-to-date, respectively1. Since the
beginning of 2018, tenant bankruptcies resulted in 2.7 million
square feet within the portfolio becoming vacant, of which nearly
75% will be occupied with new tenants by this year end and
contributing to earnings.1) Same-store NOI including impact of
bankruptcies were -1.4% for the quarter and 0.1% on a year-to-date
basis.
Our Core Retail business leased over 9.8 million
square feet over the past 12 months with suite-to-suite rent
spreads growing at 7.2%2. At quarter-end, the portfolio was 95.0%
leased and we expect it to increase through the remainder of the
year to 96%. In-place rents increased 2.2% throughout the
portfolio, with NOI-weighted sales growing 5.2% to $777 per square
foot, a new high for the portfolio.2) Excluding certain short-term
renewals at Ala Moana Center. This metric is weighted by
NOI.
Our LP Investments generated Company FFO and
realized gains of $106 million for the quarter ended June 30, 2019,
compared to $87 million in the comparable period in 2018. Strong
performance in our hospitality portfolio during the quarter and
contributions from investments in BSREP III were offset by the loss
of income from the sale of stable and mature investments and higher
average interest rates.
|
Three months ended June 30, |
|
|
Six months ended June 30, |
|
(US$ Millions) |
|
2019 |
|
|
2018 |
|
|
|
2019 |
|
2018 |
|
Company FFO and realized gains: |
|
|
|
|
|
|
|
|
|
Core Office |
$ |
187 |
|
$ |
149 |
|
|
$ |
327 |
|
$ |
302 |
|
Core Retail |
|
170 |
|
|
119 |
|
|
|
354 |
|
|
235 |
|
LP Investments |
|
106 |
|
|
87 |
|
|
|
252 |
|
|
184 |
|
Corporate |
|
(101 |
) |
|
(105 |
) |
|
|
(204 |
) |
|
(202 |
) |
Company FFO and realized gains(1) |
$ |
362 |
|
$ |
250 |
|
|
$ |
729 |
|
$ |
519 |
|
(1) See "Basis of Presentation" and
"Reconciliation of Non-IFRS Measures" below in this press release
for the definitions and components.
Dispositions
In the second quarter of 2019 we completed $326
million of gross asset dispositions at our share, at prices that
were 9% higher than our IFRS carrying values. These sales generated
$173 million in net proceeds. Dispositions completed in the second
quarter include:
- Our 43% interest in 2001 M Street in Washington, D.C. for net
proceeds of $45 million.
- Our 50% interest in the office building at 240 Queen Street in
Brisbane for net proceeds of $36 million.
- Our interest in the Marina Village office park in Alameda, CA
for net proceeds of $27 million.
In addition, subsequent to quarter-end we entered into contracts
to sell:
- Our remaining 26% interest in 75 State Street in Boston for net
proceeds of $79 million.
- Our 30% stake in the Darling Park Complex in Sydney for net
proceeds of A$432 million.
- The majority of assets in our Manhattan multifamily portfolio
for net proceeds of $135 million.
- A portion of our triple net lease automotive dealership assets
(CARS) for net proceeds of $24 million.
Balance Sheet Update
To increase liquidity and extend the maturity of our debt,
during and subsequent to the second quarter we executed the
following financing transactions:
- In Core Office, we raised an aggregate of $1.1 billion in
fixed-rate mortgages with an average term of nine years at an
average interest rate of 4.28%, as well as an aggregate of $1.2
billion in floating-rate mortgages with an average term of five
years.
- In Core Retail, we raised an aggregate of $1.4 billion in
fixed-rate mortgages with an average term of ten years at an
average interest rate of 4.32%, as well as an aggregate of $515
million in floating-rate mortgages with an average term of five
years.
Unit Repurchase Program
Utilizing in-place normal course issuer bids
(“NCIBs”), we purchased 2,880,614 of BPY units and BPR shares in
the second quarter of 2019 at an average price of $19.38 per
unit/share.
Subsequent to quarter-end, we purchased 396,712
additional BPY units and BPR shares at an average price of $18.90
per unit/share.
Distribution Declaration
The Board of Directors has declared a quarterly
distribution on the partnership’s LP units of $0.33 per unit
payable on September 30, 2019 to unitholders of record at the close
of business on August 30, 2019.
The quarterly distributions on the LP units are
declared in U.S. dollars. Registered unitholders residing in the
United States shall receive quarterly cash distributions in U.S.
dollars and registered unitholders not residing in the United
States shall receive quarterly cash distributions in the Canadian
dollar equivalent, based on the Bank of Canada exchange rate on the
record date. Registered unitholders residing in the United States
have the option, through Brookfield Property Partners’ transfer
agent, AST Trust Company (Canada) ("AST"), to elect to receive
quarterly cash distributions in the Canadian dollar equivalent and
registered unitholders not residing in the United States have the
option through AST to elect to receive quarterly cash distributions
in U.S. dollars. Beneficial unitholders (i.e., those holding their
units in street name with their brokerage) should contact the
broker with whom their units are held to discuss their options
regarding distribution currency.
The Board of Directors has also declared a
quarterly distribution on the partnership’s preferred units of
$0.40625 per unit payable on September 30, 2019 to holders of
record at the close of business on September 2, 2019.
Additional Information
Further details regarding the operations of the Partnership are
set forth in regulatory filings. A copy of the filings may be
obtained through the website of the SEC at www.sec.gov and on the
Partnership’s SEDAR profile at www.sedar.com.
The Partnership’s quarterly letter to
unitholders and supplemental information package can be accessed
before the market open on August 2, 2019 at
bpy.brookfield.com. This additional information should be
read in conjunction with this press release.
Basis of Presentation
This press release and accompanying financial
information make reference to net operating income (“NOI”),
same-property NOI, funds from operations (“FFO”), Company FFO and
realized gains (“Company FFO and realized gains”) and net income
attributable to unitholders.
Company FFO and realized gains, and net income
attributable to unitholders are also presented on a per unit basis.
NOI, same-property NOI, FFO, Company FFO and realized gains, and
net income attributable to unitholders do not have any standardized
meaning prescribed by International Financial Reporting Standards
(“IFRS”) and therefore may not be comparable to similar measures
presented by other companies. The Partnership uses NOI,
same-property NOI, FFO, Company FFO and realized gains, and net
income attributable to unitholders to assess its operating results.
These measures should not be used as alternatives to Net Income and
other operating measures determined in accordance with IFRS, but
rather to provide supplemental insights into performance.
Further, these measures do not represent liquidity measures or cash
flow from operations and are not intended to be representative of
the funds available for distribution to unitholders either in
aggregate or on a per unit basis, where presented.
NOI is defined as revenues from commercial and
hospitality operations of consolidated properties less direct
commercial property and hospitality expenses. As NOI includes the
revenues and expenses directly associated with owning and operating
commercial property and hospitality assets, it provides a measure
to evaluate the performance of the property operations.
Same-property NOI is a subset of NOI, which
excludes NOI that is earned from assets acquired, disposed of or
developed during the periods presented, or not of a recurring
nature, and from opportunistic assets. Same-property NOI allows the
Partnership to segregate the performance of leasing and operating
initiatives on the portfolio from the impact to performance from
investing activities and “one-time items,” which for the historical
periods presented consist primarily of lease termination
income.
FFO is defined as income, including equity
accounted income, before realized gains (losses) from the sale of
investment property (except gains (losses) related to properties
developed for sale), fair value gains (losses) (including equity
accounted fair value gains (losses)), depreciation and amortization
of real estate assets, income tax expense (benefit), and less
non-controlling interests of others in operating subsidiaries and
properties. FFO is a widely recognized measure that is frequently
used by securities analysts, investors and other interested parties
in the evaluation of real estate entities, particularly those that
own and operate income producing properties. The Partnership’s
definition of FFO includes all of the adjustments that are outlined
in the National Association of Real Estate Investment Trusts
(“NAREIT”) definition of FFO. In addition to the adjustments
prescribed by NAREIT, the Partnership also makes adjustments to
exclude any unrealized fair value gains (or losses) that arise as a
result of reporting under IFRS, and income taxes that arise as
certain of its subsidiaries are structured as corporations as
opposed to real estate investment trusts (“REITs”). These
additional adjustments result in an FFO measure that is similar to
that which would result if the Partnership was organized as a REIT
that determined net income in accordance with generally accepted
accounting principles in the United States (“U.S. GAAP”), which is
the type of organization on which the NAREIT definition is
premised. The Partnership’s FFO measure will differ from other
organizations applying the NAREIT definition to the extent of
certain differences between the IFRS and U.S. GAAP reporting
frameworks, principally related to the recognition of lease
termination income. FFO provides a performance measure that, when
compared year-over-year, reflects the impact on operations from
trends in occupancy rates, rental rates, operating costs and
interest costs.
Company FFO and realized gains is defined as FFO
before the impact of depreciation and amortization of non-real
estate assets, transaction costs, gains (losses) associated with
non-investment properties, imputed interest on equity accounted
investments, realized gains in the partnership’s LP Investment
segment and the partnership’s share of BSREP III Company FFO and
realized gains. Realized LP Investment gains represent income
earned on investing activity when fund investments are realized,
inclusive of associated change in carried interest to be due at a
future date to the general partner of the relevant Brookfield Asset
Management-sponsored funds. The partnership accounts for the
investment in BSREP III as a financial asset and income (loss) of
the fund is not presented in the partnership’s results.
Distributions from BSREP III, recorded as dividend income under
IFRS, are removed from investment and other income for Company FFO
and realized gains presentation.
Net income attributable to unitholders is
defined as net income attributable to holders of general
partnership units and limited partnership units of the Partnership,
redeemable/exchangeable and special limited partnership units of
Brookfield Property L.P., limited partnership units of Brookfield
Office Properties Exchange LP and Class A shares of Brookfield
Property REIT Inc. Net income attributable to unitholders is used
by the Partnership to evaluate the performance of the Partnership
as a whole as each of the unitholders participates in the economics
of the Partnership equally. In calculating net income attributable
to unitholders per unit, the Partnership excludes the impact of
mandatorily convertible preferred units in determining the average
number of units outstanding as the holders of mandatorily
convertible preferred units do not participate in current
earnings. The Partnership reconciles this measure to basic
net income attributable to unitholders per unit determined in
accordance with IFRS which includes the effect of mandatorily
convertible preferred units in the basic average number of units
outstanding.
About Brookfield Property
Partners
Brookfield Property Partners, through Brookfield
Property Partners L.P. and its subsidiary Brookfield Property REIT
Inc., is one of the world’s premier commercial real estate
companies, with over $85 billion in total assets. We are leading
owners, operators and investors in commercial real estate, with a
diversified portfolio of premier office and retail assets, as well
as interests in multifamily, triple net lease, logistics,
hospitality, self-storage, student housing and manufactured housing
assets. Brookfield Property Partners L.P. is listed on the Nasdaq
Stock Market and the Toronto Stock Exchange. Brookfield Property
REIT Inc. is listed on the Nasdaq Stock Market. Further information
is available at bpy.brookfield.com.
Brookfield Property Partners is the flagship
listed real estate company of Brookfield Asset Management Inc., a
leading global alternative asset manager with over $385 billion in
assets under management.
Please note that BPY’s previous audited annual
and unaudited quarterly reports have been filed on EDGAR and SEDAR
and can also be found at bpy.brookfield.com. Hard copies of the
annual and quarterly reports can be obtained free of charge upon
request.
Certain of our investor relations content is
also available on our investor relations app. To download
Brookfield Property Partners' investor relations app, which offers
access to SEC filings, press releases, presentations and more,
please click here to download on your iPhone or iPad. To download
the app on your Android mobile device, please click here.
Brookfield Contact:
Matthew CherrySenior Vice President, Investor
Relations and CommunicationsTel: (212) 417-7488 / Email:
matthew.cherry@brookfield.com
Conference Call and Quarterly Earnings
Details
Investors, analysts and other interested parties
can access BPY’s second quarter 2019 results as well as the letter
to unitholders and supplemental information on BPY’s website at
bpy.brookfield.com.
The conference call can be accessed via webcast
on August 2, 2019 at 11:00 a.m. Eastern Time at bpy.brookfield.com
or via teleconference by dialing +1 (844) 358-9182 toll-free in the
U.S. and Canada or for overseas calls, dial +1 (478) 219-0399,
conference ID: 8480396, at approximately 10:50 a.m. A recording of
the teleconference can be accessed by dialing +1 (855) 859-2056
toll-free in the U.S. or Canada or for overseas calls, dial +1
(404) 537-3406, conference ID: 8480396.
Forward-Looking Statements
This communication contains “forward-looking
information” within the meaning of applicable securities laws and
regulations. Forward-looking statements include statements that are
predictive in nature or depend upon or refer to future events or
conditions, include statements regarding our operations, business,
financial condition, expected financial results, performance,
prospects, opportunities, priorities, targets, goals, ongoing
objectives, strategies and outlook, as well as the outlook for
North American and international economies for the current fiscal
year and subsequent periods, and include words such as “expects,”
“anticipates,” “plans,” “believes,” “estimates,” “seeks,”
“intends,” “targets,” “projects,” “forecasts,” “likely,” or
negative versions thereof and other similar expressions, or future
or conditional verbs such as “may,” “will,” “should,” “would” and
“could.”
Although we believe that our anticipated future
results, performance or achievements expressed or implied by the
forward-looking statements and information are based upon
reasonable assumptions and expectations, the reader should not
place undue reliance on forward-looking statements and information
because they involve known and unknown risks, uncertainties and
other factors, many of which are beyond our control, which may
cause our actual results, performance or achievements to differ
materially from anticipated future results, performance or
achievement expressed or implied by such forward-looking statements
and information.
Factors that could cause actual results to
differ materially from those contemplated or implied by
forward-looking statements include, but are not limited to: risks
incidental to the ownership and operation of real estate properties
including local real estate conditions; the impact or unanticipated
impact of general economic, political and market factors in the
countries in which we do business; the ability to enter into new
leases or renew leases on favorable terms; business competition;
dependence on tenants’ financial condition; the use of debt to
finance our business; the behavior of financial markets, including
fluctuations in interest and foreign exchange rates; uncertainties
of real estate development or redevelopment; global equity and
capital markets and the availability of equity and debt financing
and refinancing within these markets; risks relating to our
insurance coverage; the possible impact of international conflicts
and other developments including terrorist acts; potential
environmental liabilities; changes in tax laws and other tax
related risks; dependence on management personnel; illiquidity of
investments; the ability to complete and effectively integrate
acquisitions into existing operations and the ability to attain
expected benefits therefrom; operational and reputational risks;
catastrophic events, such as earthquakes and hurricanes; and other
risks and factors detailed from time to time in our documents filed
with the securities regulators in Canada and the United States.
We caution that the foregoing list of important
factors that may affect future results is not exhaustive. When
relying on our forward-looking statements or information, investors
and others should carefully consider the foregoing factors and
other uncertainties and potential events. Except as required by
law, we undertake no obligation to publicly update or revise any
forward-looking statements or information, whether written or oral,
that may be as a result of new information, future events or
otherwise.
|
|
CONSOLIDATED BALANCE SHEETS |
|
|
|
|
Jun. 30, |
Dec. 31, |
(US$ Millions) |
|
2019 |
|
2018 |
Assets |
|
|
Investment properties |
$ |
69,828 |
$ |
80,196 |
Equity accounted investments in properties |
|
21,889 |
|
22,698 |
Property, plant and equipment |
|
6,854 |
|
7,506 |
Participating loan notes |
|
- |
|
268 |
Financial assets |
|
1,016 |
|
222 |
Accounts receivable and other |
|
5,344 |
|
7,338 |
Cash and cash equivalents |
|
1,751 |
|
3,288 |
Assets held for sale |
|
1,346 |
|
1,004 |
Total Assets |
$ |
108,028 |
$ |
122,520 |
Liabilities |
|
|
Corporate borrowings |
$ |
1,380 |
$ |
2,159 |
Asset-level debt obligations |
|
43,725 |
|
50,407 |
Subsidiary borrowings, non-recourse to BPY |
|
6,451 |
|
11,245 |
Capital securities |
|
3,012 |
|
3,385 |
Deferred tax liability |
|
2,492 |
|
2,378 |
Accounts payable and other liabilities |
|
6,287 |
|
6,043 |
Liabilities associated with assets held for sale |
|
765 |
|
163 |
Equity |
|
|
Preferred equity |
|
178 |
|
- |
General partner |
|
4 |
|
4 |
Limited partners |
|
12,640 |
|
12,353 |
Non-controlling interests
attributable to: |
|
|
Limited partner units of the operating partnership held by
Brookfield Asset Management Inc. |
|
12,814 |
|
12,740 |
Limited partner units of Brookfield Office Properties Exchange
LP |
|
96 |
|
96 |
Class A shares of Brookfield Property REIT Inc. |
|
2,298 |
|
3,091 |
Interests of others in operating subsidiaries and properties |
|
15,886 |
|
18,456 |
Total Equity |
|
43,916 |
|
46,740 |
Total Liabilities and Equity |
$ |
108,028 |
$ |
122,520 |
|
|
|
|
CONSOLIDATED STATEMENT OF OPERATIONS |
|
|
|
|
Three Months Ended Jun. 30, |
Six Months Ended Jun. 30, |
(US$ Millions) |
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Commercial property and hospitality revenue |
$ |
1,889 |
|
$ |
1,606 |
|
$ |
3,854 |
|
$ |
3,185 |
|
Direct commercial property and hospitality expense |
|
(785 |
) |
|
(716 |
) |
|
(1,627 |
) |
|
(1,457 |
) |
|
|
1,104 |
|
|
890 |
|
|
2,227 |
|
|
1,728 |
|
Investment and other revenue |
|
137 |
|
|
45 |
|
|
245 |
|
|
86 |
|
Share of net earnings from equity accounted investments |
|
826 |
|
|
288 |
|
|
1,090 |
|
|
516 |
|
|
|
2,067 |
|
|
1,223 |
|
|
3,562 |
|
|
2,330 |
|
Expenses |
|
|
|
|
Interest expense |
|
(710 |
) |
|
(537 |
) |
|
(1,456 |
) |
|
(1,057 |
) |
Depreciation and amortization |
|
(85 |
) |
|
(76 |
) |
|
(170 |
) |
|
(148 |
) |
General and administrative expense |
|
(219 |
) |
|
(183 |
) |
|
(442 |
) |
|
(352 |
) |
Investment and other expense |
|
- |
|
|
- |
|
|
(10 |
) |
|
- |
|
|
|
1,053 |
|
|
427 |
|
|
1,484 |
|
|
773 |
|
Fair value gains, net |
|
(1,092 |
) |
|
770 |
|
|
(722 |
) |
|
1,387 |
|
Income tax (expense) benefit |
|
62 |
|
|
(146 |
) |
|
(26 |
) |
|
(86 |
) |
Net income |
$ |
23 |
|
$ |
1,051 |
|
$ |
736 |
|
$ |
2,074 |
|
|
|
|
|
|
Net income attributable to: |
|
|
|
|
General partner |
$ |
- |
|
$ |
- |
|
$ |
- |
|
$ |
- |
|
Limited partners |
|
57 |
|
|
194 |
|
|
203 |
|
|
386 |
|
Non-controlling interests: |
|
|
|
|
Limited partner units of the operating partnership held by
Brookfield Asset Management Inc. |
|
59 |
|
|
332 |
|
|
209 |
|
|
662 |
|
Limited partner units of Brookfield Office Properties Exchange
LP |
|
1 |
|
|
8 |
|
|
2 |
|
|
16 |
|
Class A shares of Brookfield Property REIT |
|
10 |
|
|
- |
|
|
46 |
|
|
- |
|
Interests of others in operating subsidiaries and properties |
|
(104 |
) |
|
517 |
|
|
276 |
|
|
1,010 |
|
|
$ |
23 |
|
$ |
1,051 |
|
$ |
736 |
|
$ |
2,074 |
|
|
|
|
|
|
|
RECONCILIATION OF NON-IFRS MEASURES |
|
|
|
|
|
|
Three Months Ended Jun. 30, |
Six Months Ended Jun. 30, |
(US$ Millions) |
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Commercial property and hospitality revenue |
$ |
1,889 |
|
$ |
1,606 |
|
$ |
3,854 |
|
$ |
3,185 |
|
Direct commercial property and hospitality expense |
|
(785 |
) |
|
(716 |
) |
|
(1,627 |
) |
|
(1,457 |
) |
NOI |
|
1,104 |
|
|
890 |
|
|
2,227 |
|
|
1,728 |
|
Investment and other revenue |
|
137 |
|
|
45 |
|
|
245 |
|
|
86 |
|
Share of equity accounted income excluding fair value gains |
|
208 |
|
|
204 |
|
|
445 |
|
|
431 |
|
Interest expense |
|
(710 |
) |
|
(537 |
) |
|
(1,456 |
) |
|
(1,057 |
) |
General and administrative expense |
|
(219 |
) |
|
(183 |
) |
|
(442 |
) |
|
(352 |
) |
Investment and other expense |
|
- |
|
|
- |
|
|
(10 |
) |
|
- |
|
Depreciation and amortization of non-real estate assets |
|
(15 |
) |
|
(10 |
) |
|
(31 |
) |
|
(17 |
) |
Non-controlling interests of others in operating subsidiaries and
properties in FFO |
|
(214 |
) |
|
(199 |
) |
|
(429 |
) |
|
(381 |
) |
FFO |
|
291 |
|
|
210 |
|
|
549 |
|
|
438 |
|
Depreciation and amortization of non-real estate assets,
net(1) |
|
10 |
|
|
6 |
|
|
21 |
|
|
15 |
|
Transaction costs(1) |
|
18 |
|
|
15 |
|
|
37 |
|
|
33 |
|
Gains/losses on disposition of non-investment properties(1) |
|
- |
|
|
3 |
|
|
(1 |
) |
|
3 |
|
Imputed Interest(2) |
|
13 |
|
|
12 |
|
|
27 |
|
|
25 |
|
LP Investments realized gains(3) |
|
27 |
|
|
4 |
|
|
87 |
|
|
5 |
|
BSREP III earnings(4) |
|
3 |
|
|
- |
|
|
9 |
|
|
- |
|
Company FFO and realized gains |
$ |
362 |
|
$ |
250 |
|
$ |
729 |
|
$ |
519 |
|
|
|
|
|
|
|
|
|
|
|
FFO |
|
291 |
|
|
210 |
|
|
549 |
|
|
438 |
|
Depreciation and amortization of real estate assets |
|
(70 |
) |
|
(66 |
) |
|
(139 |
) |
|
(131 |
) |
Fair value (losses) gains, net |
|
(1,092 |
) |
|
770 |
|
|
(722 |
) |
|
1,387 |
|
Share of equity accounted income - Non FFO |
|
618 |
|
|
84 |
|
|
645 |
|
|
85 |
|
Income tax (expense)
benefit |
|
62 |
|
|
(146 |
) |
|
(26 |
) |
|
(86 |
) |
Non-controlling interests of others in operating subsidiaries and
properties in non-FFO |
|
318 |
|
|
(318 |
) |
|
153 |
|
|
(629 |
) |
Non-controlling interests of others in operating subsidiaries and
properties |
|
(104 |
) |
|
517 |
|
|
276 |
|
|
1,010 |
|
Net income |
$ |
23 |
|
$ |
1,051 |
|
$ |
736 |
|
$ |
2,074 |
|
(1) Presented
net of non-controlling interests on a proportionate basis. |
(2) Represents
imputed interest on commercial developments accounted for under the
equity method under IFRS. |
(3) Net of
associated carried interest to be due at a future date. |
(4) BSREP III
is now accounted for as a financial asset which results in FFO
being recognized in line with distributions. As such, the BSREP III
earnings adjustment picks up our proportionate share of the Company
FFO. |
|
|
|
|
|
|
NET INCOME PER UNIT |
|
|
Three months ended |
|
|
Jun. 30, 2019 |
|
Jun.30, 2018 |
|
(US$
Millions, except per unit amounts) |
Net incomeattributabletoUnitholders |
Averagenumber
ofunits |
Per unit |
|
Net incomeattributabletoUnitholders |
Averagenumber ofunits |
Per unit |
|
Basic |
$ |
127 |
|
952.1 |
$ |
0.13 |
|
$ |
534 |
703.1 |
$ |
0.76 |
|
Preferred share dividends |
|
(3 |
) |
- |
|
- |
|
|
- |
- |
|
- |
|
Number of units on conversion of preferred shares(1) |
|
- |
|
70.1 |
|
- |
|
|
- |
70.0 |
|
- |
|
Basic per IFRS |
|
124 |
|
1,022.2 |
|
0.12 |
|
|
534 |
773.1 |
|
0.69 |
|
Dilutive effect of conversion of capital securities and
options(2) |
|
- |
|
0.1 |
|
- |
|
|
5 |
19.6 |
|
0.26 |
|
Fully-diluted per IFRS |
$ |
124 |
|
1,022.3 |
$ |
0.12 |
|
$ |
539 |
792.7 |
$ |
0.68 |
|
(1) IFRS
requires the inclusion of preferred shares that are mandatorily
convertible into units at a price of $25.70 without an add back to
earnings of the associated carry on the preferred shares. |
|
(2) For the
three months ended June 30, 2019, the conversion of capital
securities was anti-dilutive and therefore excluded from the
calculation of fully-diluted net income per IFRS. |
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Jun. 30, 2019 |
|
Jun.30, 2018 |
|
(US$
Millions, except per unit amounts) |
Net incomeattributabletoUnitholders |
Averagenumber
ofunits |
Per unit |
|
Net incomeattributabletoUnitholders |
Averagenumber ofunits |
Per unit |
|
Basic per management |
$ |
127 |
|
952.1 |
$ |
0.13 |
|
$ |
534 |
703.1 |
$ |
0.76 |
|
Preferred share dividends |
|
(3 |
) |
- |
|
- |
|
|
- |
- |
|
- |
|
Dilutive effect of conversion of preferred shares(1) |
|
29 |
|
70.1 |
|
0.41 |
|
|
29 |
70.0 |
|
0.41 |
|
Dilutive effect of conversion of capital securities and
options(2) |
|
2 |
|
4.5 |
|
0.44 |
|
|
5 |
19.6 |
|
0.26 |
|
Fully-diluted per management |
$ |
155 |
|
1,026.7 |
$ |
0.15 |
|
$ |
568 |
792.7 |
$ |
0.72 |
|
(1) Represents
preferred shares that are mandatorily convertible into units at a
price of $25.70 and the associated carry. |
|
(2) For the
three months ended June 30, 2019, the conversion of capital
securities was anti-dilutive and therefore excluded from the
calculation of fully-diluted net income per IFRS. |
|
|
|
|
|
|
|
|
|
|
|
NET INCOME PER UNIT |
|
|
Six months ended |
|
Jun. 30, 2019 |
|
Jun.30, 2018 |
(US$
Millions, except per unit amounts) |
Net incomeattributabletoUnitholders |
Averagenumber
ofunits |
Per unit |
|
Net incomeattributabletoUnitholders |
Averagenumber ofunits |
Per unit |
Basic |
$ |
460 |
|
961.4 |
$ |
0.48 |
|
$ |
1,064 |
703.3 |
$ |
1.51 |
Preferred share dividends |
|
(3 |
) |
- |
|
- |
|
|
- |
- |
|
- |
Number of units on conversion of preferred shares(1) |
|
- |
|
70.1 |
|
- |
|
|
- |
70.0 |
|
- |
Basic per IFRS |
|
457 |
|
1,031.5 |
|
0.44 |
|
|
1,064 |
773.3 |
|
1.38 |
Dilutive effect of conversion of capital securities and
options(2) |
|
- |
|
0.1 |
|
- |
|
|
11 |
18.2 |
|
0.60 |
Fully-diluted per IFRS |
$ |
457 |
|
1,031.6 |
$ |
0.44 |
|
$ |
1,075 |
791.5 |
$ |
1.36 |
(1) IFRS
requires the inclusion of preferred shares that are mandatorily
convertible into units at a price of $25.70 without an add back to
earnings of the associated carry on the preferred shares. |
(2) For the six
months ended June 30, 2019, the conversion of capital securities
was anti-dilutive and therefore excluded from the calculation of
fully-diluted net income per IFRS. |
|
|
|
|
|
|
|
|
|
Six months ended |
|
Jun. 30, 2019 |
|
Jun.30, 2018 |
(US$
Millions, except per unit amounts) |
Net incomeattributabletoUnitholders |
Averagenumber
ofunits |
Per unit |
|
Net incomeattributabletoUnitholders |
Averagenumber ofunits |
Per unit |
Basic per management |
$ |
460 |
|
961.4 |
$ |
0.48 |
|
$ |
1,064 |
703.3 |
$ |
1.51 |
Preferred share dividends |
|
(3 |
) |
- |
|
- |
|
|
- |
- |
|
- |
Dilutive effect of conversion of preferred shares(1) |
|
59 |
|
70.1 |
|
0.84 |
|
|
59 |
70.0 |
|
0.84 |
Dilutive effect of conversion of capital securities and
options(2) |
|
8 |
|
13.1 |
|
0.61 |
|
|
11 |
18.2 |
|
0.60 |
Fully-diluted per management |
$ |
524 |
|
1,044.6 |
$ |
0.50 |
|
$ |
1,134 |
791.5 |
$ |
1.43 |
(1) Represents
preferred shares that are mandatorily convertible into units at a
price of $25.70 and the associated carry. |
(2) For the six
months ended June 30, 2019, the conversion of capital securities
was anti-dilutive and therefore excluded from the calculation of
fully-diluted net income per IFRS. |
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