NEWS RELEASE
CONTACT:
 
6110 Executive Blvd., Suite 800
William T. Camp
Rockville, Maryland 20852
Executive Vice President and
Tel 301-984-9400
Chief Financial Officer
Fax 301-984-9610
E-Mail: bcamp@writ.com
www.writ.com
 
 
 
 
July 24, 2013
WASHINGTON REAL ESTATE INVESTMENT TRUST ANNOUNCES
SECOND QUARTER FINANCIAL AND OPERATING RESULTS
Washington Real Estate Investment Trust (“WRIT” or the “Company”) (NYSE: WRE), a leading owner and operator of diversified properties in the Washington, D.C. region, reported financial and operating results today for the quarter ended June 30, 2013:

Second Quarter 2013 Highlights

•
Generated Core Funds from Operations (FFO) of $0.47 per diluted share for the quarter, a 5% increase over first quarter 2013
•
Improved same-store physical occupancy in the office portfolio 90 bps and retail portfolio 80 bps over first quarter 2013
•
Produced same-store net operating income growth of 1.8% over first quarter of 2013
•
Executed 70 new and renewal leases totaling 417,615 square feet at an average rental rate increase of 7.0% over in-place rents for new leases and average rental rate increase of 8.9% over in-place rents for renewal leases
•
Announced the renovation of largest asset in portfolio, 7900 Westpark Drive located in Tysons Corner, Virginia
•
Achieved LEED® EB on over one million square feet of office space and was the recipient of the 2013 Apartment and Office Building Association's (AOBA) TOBY (The Outstanding Building of the Year) Award in the Earth category for WRIT's 1220 19th Street office property

“Improving real estate fundamentals have continued into the second quarter of the year," said George F. “Skip” McKenzie, President and Chief Executive Officer of WRIT. "The capital expenditures and renovations made to our office portfolio in late 2012 and the first quarter of 2013 have resulted in steady improvement in leasing volume, rental rate growth, and increased occupancy."

Financial Highlights

Core Funds from Operations(1), defined as Funds from Operations(1) (“FFO”) excluding acquisition expense, gains or losses on extinguishment of debt, severance expense and impairment, was $31.2 million, or $0.47 per diluted share for the quarter ended June 30, 2013, compared to $31.9 million, or $0.48 per diluted share for the prior year period. FFO for the quarter ended June 30, 2013 was $30.8 million, or $0.46 per diluted share, compared to $31.6 million, or $0.47 per diluted share, in the same period one year ago.

Net income attributable to the controlling interests for the quarter ended June 30, 2013 was $5.3 million, or $0.08 per diluted share, compared to $6.0 million, or $0.09 per diluted share, in the same period one year ago.

Operating Results

The Company's overall portfolio Net Operating Income (“NOI”)(2) was $50.8 million compared to $50.6 million in the same period one year ago and $49.8 million in the first quarter of 2013. Overall portfolio physical occupancy for the second quarter was 89.1%, compared to 89.3% in the same period one year ago and 88.6% in the first quarter of 2013.


Washington Real Estate Investment Trust
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Same-store(3) portfolio physical occupancy for the second quarter was 89.5%, compared to 89.9% in the same period one year ago. Sequentially, same-store physical occupancy increased 30 basis points (bps) compared to the first quarter of 2013. Same-store portfolio NOI for the second quarter decreased 1.2% and rental rate growth was 2.4% compared to the same period one year ago.
 
▪
Office: 48.4% of Total NOI - Office properties' same-store NOI for the second quarter decreased 2.1% compared to the same period one year ago. Rental rate growth was 1.7% while same-store physical occupancy increased 30 bps to 86.3%. Sequentially, same-store physical occupancy increased 90 bps compared to the first quarter of 2013.
▪
Retail: 21.0% of Total NOI - Retail properties' same-store NOI for the second quarter decreased 2.2% compared to the same period one year ago. Rental rate growth was 4.1% while same-store physical occupancy decreased 10 bps to 93.2%. Sequentially, same-store physical occupancy increased 80 bps compared to the first quarter of 2013.
▪
Multifamily: 15.5% of Total NOI - Multifamily properties' same-store NOI for the second quarter decreased 1.3% compared to the same period one year ago. Rental rate growth was 3.8% while same-store physical occupancy decreased 170 bps to 93.1%. Sequentially, same-store physical occupancy decreased 70 bps compared to the first quarter of 2013.
▪
Medical: 15.1% of Total NOI - Medical office properties' same-store NOI for the second quarter increased 3.3% compared to the same period one year ago. Rental rate growth was 1.4% while same-store physical occupancy decreased 190 bps to 87.8%. Sequentially, same-store physical occupancy decreased 60 bps compared to the first quarter of 2013.

Leasing Activity

During the second quarter, WRIT signed commercial leases totaling 417,615 square feet, including 103,513 square feet of new leases and 314,102 square feet of renewal leases, as follows (all dollar amounts are on a per square foot basis):
 
Square Feet
Weighted Average Term
(in years)
Weighted Average Rental Rates
Weighted Average Rental Rate % Increase
Tenant Improvements
Leasing Commissions and Incentives
New:
 
 
 
 
 
 
Office
94,191

7.8

$
30.34

7.3
 %
$
34.88

$
23.08

Retail
6,240

7.1

33.54

7.1
 %
19.20

11.50

Medical Office
3,082

5.4

30.97

(1.8
)%
21.82

13.90

Total
103,513

7.6

30.55

7.0
 %
33.55

22.10

 
 
 
 
 
 
 
Renewal:
 
 
 
 
 
 
Office
92,245

3.5

$
32.51

5.8
 %
$
6.12

$
2.40

Retail
172,474

5.3

8.74

12.3
 %
0.38

0.48

Medical Office
49,383

10.4

35.23

11.5
 %
12.94

2.55

Total
314,102

5.6

19.88

8.9
 %
4.04

1.37


Renovation Activity

WRIT announced the renovation of 7900 Westpark Drive, a 528,000 square foot office complex located in Tysons Corner, Virginia at the corner of Westpark Drive and Jones Branch drive, immediately off the Capital Beltway (I-495) and Route 123. 7900 Westpark Drive is within four city blocks of the Tysons I & II Metro Station, scheduled to open in 2013, and has direct access to the new 495 Express Lanes. Construction is projected to commence in the fourth quarter 2013 and has a total project cost of $35 million.



Washington Real Estate Investment Trust
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Dividends

On June 28, 2013, WRIT paid a quarterly dividend of $0.30 per share.

Conference Call Information

The Conference Call for 2nd Quarter Earnings is scheduled for Thursday, July 25, 2013 at 11:00 A.M. Eastern time. Conference Call access information is as follows:

USA Toll Free Number:            1-877-407-9205
International Toll Number:        1-201-689-8054

The instant replay of the Conference Call will be available until August 8, 2013 at 11:59 P.M. Eastern time. Instant replay access information is as follows:

USA Toll Free Number:            1-877-660-6853
International Toll Number:        1-201-612-7415
Conference ID:                416546

The live on-demand webcast of the Conference Call will be available on the Investor section of WRIT's website at www.writ.com. On-line playback of the webcast will be available for two weeks following the Conference Call.

About WRIT

WRIT is a self-administered, self-managed, equity real estate investment trust investing in income-producing properties in the greater Washington metro region. WRIT owns a diversified portfolio of 69 properties, totaling approximately 8 million square feet of commercial space and 2,540 multifamily units, and land held for development. These 69 properties consist of 25 office properties, 17 medical office properties, 16 retail centers and 11 multifamily properties. WRIT shares are publicly traded on the New York Stock Exchange (NYSE:WRE).
Note: WRIT's press releases and supplemental financial information are available on the company website at www.writ.com or by contacting Investor Relations at (301) 984-9400.
Certain statements in our earnings release and on our conference call are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially. Such risks, uncertainties and other factors include, but are not limited to, the potential for federal government budget reductions, changes in general and local economic and real estate market conditions, the timing and pricing of lease transactions, the availability and cost of capital, fluctuations in interest rates, tenants' financial conditions, levels of competition, the effect of government regulation, the impact of newly adopted accounting principles, and other risks and uncertainties detailed from time to time in our filings with the SEC, including our 2012 Form 10-K and First Quarter 2013 Form 10-Q. We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

(1) Funds From Operations (“FFO”) - The National Association of Real Estate Investment Trusts, Inc. (“NAREIT”) defines FFO (April, 2002 White Paper) as net income (computed in accordance with generally accepted accounting principles (“GAAP”)) excluding gains (or losses) associated with sales of property, impairment of depreciable real estate and real estate depreciation and amortization. FFO is a non-GAAP measure and does not replace net income as a measure of performance or net cash provided by operating activities as a measure of liquidity. We consider FFO to be a standard supplemental measure for equity real estate investment trusts (“REITs”) because it facilitates an understanding of the operating performance of our properties without giving effect to real estate depreciation and amortization, which historically assumes that the value of real estate assets diminishes predictably over time. Since real estate values have instead historically risen or fallen with market conditions, we believe that FFO more accurately provides investors an indication of our ability to incur and service debt, make capital expenditures and fund other needs.

Core Funds From Operations (“Core FFO”) is calculated by adjusting FFO for the following items (which we believe are not indicative of the performance of WRIT's operating portfolio and affect the comparative measurement of WRIT's operating performance over time): (1) gains or losses on extinguishment of debt, (2) costs related to the acquisition of properties, (3) severance expense related to corporate reorganization and related to the CEO's retirement and (4) property impairments not already excluded from FFO, as appropriate. These items can vary greatly from period to period, depending upon the volume of our acquisition activity and debt retirements, among other factors. We believe that by excluding these items, Core FFO serves as a useful, supplementary measure of WRIT's ability to incur and service debt and to distribute dividends to its shareholders. Core FFO is a non-GAAP and non-standardized measure and may be calculated differently by other REITs.

(2) Net Operating Income (“NOI”), defined as real estate rental revenue less real estate expenses, is a non-GAAP measure. NOI is calculated as net income, less non-real estate revenue and the results of discontinued operations (including the gain on sale, if any), plus interest expense, depreciation and amortization, general and administrative expenses, acquisition costs and real estate impairment. We provide NOI as a supplement


Washington Real Estate Investment Trust
Page 4 of 10


to net income calculated in accordance with GAAP. As such, it should not be considered an alternative to net income as an indication of our operating performance. It is the primary performance measure we use to assess the results of our operations at the property level.

(3) For purposes of evaluating comparative operating performance, we categorize our properties as “same-store” or “non-same-store”. A same-store property is one that was owned for the entirety of the periods being evaluated. A non-same-store property is one that was acquired or placed into service during either of the periods being evaluated.

(4) Funds Available for Distribution (“FAD”) is a non-GAAP measure. It is calculated by subtracting from FFO (1) recurring expenditures, tenant improvements and leasing costs that are capitalized and amortized and are necessary to maintain our properties and revenue stream and (2) straight-line rents, then adding (3) non-real estate depreciation and amortization, (4) amortization of restricted share and unit compensation, and adding or subtracting amortization of lease intangibles, as appropriate. We consider FAD to be a measure of a REIT's ability to incur and service debt and to distribute dividends to its shareholders. FAD is a non-standardized measure and may be calculated differently by other REITs.

Physical Occupancy Levels by Same-Store Properties (i) and All Properties
 
Physical Occupancy
 
Same-Store Properties
 
All Properties
 
2nd QTR
 
2nd QTR
 
2nd QTR
 
2nd QTR
Segment
2013
 
2012
 
2013
 
2012
Multifamily
93.1
%
 
94.8
%
 
93.1
%
 
94.8
%
Office
86.3
%
 
86.0
%
 
86.3
%
 
85.8
%
Medical Office
87.8
%
 
89.7
%
 
84.8
%
 
86.4
%
Retail
93.2
%
 
93.3
%
 
93.2
%
 
93.3
%
 
 
 
 
 
 
 
 
Overall Portfolio
89.5
%
 
89.9
%
 
89.1
%
 
89.3
%

(i) Same-Store properties include all stabilized properties that were owned for the entirety of the current and prior year reporting periods. We consider newly constructed properties to be stabilized when they achieve 90% occupancy. For Q2 2013 and Q2 2012, same-store properties exclude:
Multifamily Acquisitions: none;
Office Acquisition: Fairgate at Ballston;
Medical Office Acquisition: 19500 at Riverside Office Park (formerly Lansdowne Medical Office Building);
Retail Acquisition: none.

Also excluded from Same-Store Properties in Q2 2013 and Q2 2012 are:
Held for Sale and Sold Properties: 1700 Research Boulevard, Plumtree Medical Center and the Atrium Building.





Washington Real Estate Investment Trust
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 WASHINGTON REAL ESTATE INVESTMENT TRUST
FINANCIAL HIGHLIGHTS
(In thousands, except per share data)
(Unaudited)
 
 
 
 
 
 
 
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
OPERATING RESULTS
2013
 
2012
 
2013
 
2012
Revenue
 
 
 
 
 
 
 
Real estate rental revenue
$
78,272

 
$
75,590

 
$
155,196

 
$
150,804

Expenses
 
 
 
 
 
 
 
Real estate expenses
27,429

 
25,033

 
54,520

 
50,584

Depreciation and amortization
25,582

 
25,227

 
51,106

 
50,809

Acquisition costs
87

 
254

 
300

 
308

General and administrative
4,005

 
4,164

 
7,867

 
7,770

 
57,103

 
54,678

 
113,793

 
109,471

Real estate operating income
21,169

 
20,912

 
41,403

 
41,333

Other income (expense):
 
 
 
 
 
 
 
Interest expense
(16,152
)
 
(15,470
)
 
(32,670
)
 
(31,301
)
Other income
246

 
252

 
485

 
496

 
(15,906
)
 
(15,218
)
 
(32,185
)
 
(30,805
)
 
 
 
 
 
 
 
 
Income from continuing operations
5,263

 
5,694

 
9,218

 
10,528

 
 
 
 
 
 
 
 
Discontinued operations:
 
 
 
 
 
 
 
Income from operations of properties sold or held for sale
—

 
314

 
185

 
661

Gain on sale of real estate
—

 
—

 
3,195

 
—

Net income
5,263

 
6,008

 
12,598

 
11,189

Less: Net income attributable to noncontrolling interests in subsidiaries
—

 
—

 
—

 
—

Net income attributable to the controlling interests
$
5,263

 
$
6,008

 
$
12,598

 
$
11,189

 
 
 
 
 
 
 
 
Income from continuing operations
5,263

 
5,694

 
9,218

 
10,528

Continuing operations real estate depreciation and amortization
25,582

 
25,227

 
51,106

 
50,809

Funds from continuing operations(1)
$
30,845

 
$
30,921

 
$
60,324

 
$
61,337

 
 
 
 
 
 
 
 
Income from operations of properties sold or held for sale
—

 
314

 
185

 
661

Discontinued operations real estate depreciation and amortization
—

 
364

 
—

 
776

Funds from discontinued operations
—

 
678

 
185

 
1,437

 
 
 
 
 
 
 
 
Funds from operations(1)
$
30,845

 
$
31,599

 
$
60,509

 
$
62,774

 
 
 
 
 
 
 
 
Tenant improvements
(5,918
)
 
(2,357
)
 
(9,893
)
 
(6,423
)
External and internal leasing commissions capitalized
(2,342
)
 
(2,122
)
 
(4,948
)
 
(4,679
)
Recurring capital improvements
(2,311
)
 
(2,992
)
 
(3,032
)
 
(4,531
)
Straight-line rents, net
(483
)
 
(688
)
 
(826
)
 
(1,680
)
Non-cash fair value interest expense
255

 
229

 
509

 
457

Non real estate depreciation & amortization of debt costs
933

 
948

 
1,891

 
1,956

Amortization of lease intangibles, net
86

 
(3
)
 
127

 
(3
)
Amortization and expensing of restricted share and unit compensation
1,355

 
1,333

 
2,373

 
2,738

Funds available for distribution(4)
$
22,420

 
$
25,947

 
$
46,710

 
$
50,609

 
 
 
 
 
 
 
 
Note: Certain prior period amounts have been reclassified to conform to the current presentation.


Washington Real Estate Investment Trust
Page 6 of 10



 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
Per share data:
 
2013
 
2012
 
2013
 
2012
Income from continuing operations
(Basic)
$
0.08

 
$
0.08

 
$
0.14

 
$
0.15

 
(Diluted)
$
0.08

 
$
0.08

 
$
0.14

 
$
0.15

Net income
(Basic)
$
0.08

 
$
0.09

 
$
0.19

 
$
0.16

 
(Diluted)
$
0.08

 
$
0.09

 
$
0.19

 
$
0.16

Funds from continuing operations
(Basic)
$
0.46

 
$
0.46

 
$
0.91

 
$
0.92

 
(Diluted)
$
0.46

 
$
0.46

 
$
0.90

 
$
0.92

Funds from operations
(Basic)
$
0.46

 
$
0.47

 
$
0.91

 
$
0.94

 
(Diluted)
$
0.46

 
$
0.47

 
$
0.91

 
$
0.94

 
 
 
 
 
 
 
 
 
Dividends paid
 
$
0.3000

 
$
0.4338

 
$
0.6000

 
$
0.8676

 
 
 
 
 
 
 
 
 
Weighted average shares outstanding
 
66,405

 
66,241

 
66,399

 
66,218

Fully diluted weighted average shares outstanding
 
66,556

 
66,380

 
66,537

 
66,354




Washington Real Estate Investment Trust
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WASHINGTON REAL ESTATE INVESTMENT TRUST
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
 
 
 
 
 
June 30, 2013
 
 
 
(unaudited)
 
December 31, 2012
Assets
 
 
 
Land
$
483,198

 
$
483,198

Income producing property
2,003,826

 
1,979,348

 
2,487,024

 
2,462,546

Accumulated depreciation and amortization
(646,993
)
 
(604,614
)
Net income producing property
1,840,031

 
1,857,932

Development in progress
55,262

 
49,135

Total real estate held for investment, net
1,895,293

 
1,907,067

Investment in real estate held for sale, net
—

 
11,528

Cash and cash equivalents
5,919

 
19,324

Restricted cash
10,839

 
14,582

Rents and other receivables, net of allowance for doubtful accounts of $9,585 and $10,958 respectively
60,100

 
57,076

Prepaid expenses and other assets
108,591

 
114,541

Other assets related to properties sold or held for sale
—

 
258

Total assets
$
2,080,742

 
$
2,124,376

 
 
 
 
Liabilities
 
 
 
Notes payable
$
846,450

 
$
906,190

Mortgage notes payable
312,211

 
342,970

Lines of credit
75,000

 
—

Accounts payable and other liabilities
51,715

 
52,823

Advance rents
14,239

 
16,096

Tenant security deposits
9,899

 
9,936

Other liabilities related to properties sold or held for sale
—

 
218

Total liabilities
1,309,514

 
1,328,233

 
 
 
 
Equity
 
 
 
Shareholders' equity
 
 
 
Preferred shares; $0.01 par value; 10,000 shares authorized; no shares issued and outstanding
—

 
—

Shares of beneficial interest, $0.01 par value; 100,000 shares authorized; 66,500 and 66,437 shares issued and outstanding, respectively
665

 
664

Additional paid-in capital
1,147,710

 
1,145,515

Distributions in excess of net income
(381,623
)
 
(354,122
)
Total shareholders' equity
766,752

 
792,057

 
 
 
 
Noncontrolling interests in subsidiaries
4,476

 
4,086

Total equity
771,228

 
796,143

 
 
 
 
Total liabilities and equity
$
2,080,742

 
$
2,124,376

 
 
 
 
 




Washington Real Estate Investment Trust
Page 8 of 10


The following tables contain reconciliations of net income to same-store net operating income for the periods presented (in thousands):
 
 
 
 
 
 
 
 
 
 
Quarter Ended June 30, 2013
Multifamily
 
Office
 
Medical Office
 
Retail
 
Total
Same-store net operating income(3)
$
7,893

 
$
23,708

 
$
7,490

 
$
10,698

 
$
49,789

Add: Net operating income from non-same-store properties(3)
—

 
850

 
204

 
—

 
1,054

Total net operating income(2)
$
7,893

 
$
24,558

 
$
7,694

 
$
10,698

 
$
50,843

Add/(deduct):
 
 
 
 
 
 
 
 
 
Other income
 
 
 
 
 
 
 
 
246

Acquisition costs
 
 
 
 
 
 
 
 
(87
)
Interest expense
 
 
 
 
 
 
 
 
(16,152
)
Depreciation and amortization
 
 
 
 
 
 
 
 
(25,582
)
General and administrative expenses
 
 
 
 
 
 
 
 
(4,005
)
Net income
 
 
 
 
 
 
 
 
5,263

Less: Net income attributable to noncontrolling interests in subsidiaries
 
 
 
 
 
 
 
 
—

Net income attributable to the controlling interests
 
 
 
 
 
 
 
 
$
5,263

 
 
 
 
 
 
 
 
 
 
Quarter Ended June 30, 2012
Multifamily
 
Office
 
Medical Office
 
Retail
 
Total
Same-store net operating income(3)
$
7,998

 
$
24,224

 
$
7,253

 
$
10,940

 
$
50,415

Add: Net operating income from non-same-store properties(3)
—

 
52

 
90

 
—

 
142

Total net operating income(2)
$
7,998

 
$
24,276

 
$
7,343

 
$
10,940

 
$
50,557

Add/(deduct):
 
 
 
 
 
 
 
 
 
Other income
 
 
 
 
 
 
 
 
252

Acquisition costs
 
 
 
 
 
 
 
 
(254
)
Interest expense
 
 
 
 
 
 
 
 
(15,470
)
Depreciation and amortization
 
 
 
 
 
 
 
 
(25,227
)
General and administrative expenses
 
 
 
 
 
 
 
 
(4,164
)
Income from operations of properties sold or held for sale
 
 
 
 
 
 
 
 
314

Net income
 
 
 
 
 
 
 
 
6,008

Less: Net income attributable to noncontrolling interests in subsidiaries
 
 
 
 
 
 
 
 
—

Net income attributable to the controlling interests
 
 
 
 
 
 
 
 
$
6,008





Washington Real Estate Investment Trust
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The following tables contain reconciliations of net income to same-store net operating income for the periods presented (in thousands):
 
 
 
 
 
 
 
 
 
 
Period Ended June 30, 2013
Multifamily
 
Office
 
Medical Office
 
Retail
 
Total
Same-store net operating income(3)
$
15,836

 
$
47,528

 
$
14,354

 
$
20,967

 
$
98,685

Add: Net operating income from non-same-store properties(3)
—

 
1,681

 
310

 
—

 
1,991

Total net operating income(2)
$
15,836

 
$
49,209

 
$
14,664

 
$
20,967

 
$
100,676

Add/(deduct):
 
 
 
 
 
 
 
 
 
Other income
 
 
 
 
 
 
 
 
485

Acquisition costs
 
 
 
 
 
 
 
 
(300
)
Interest expense
 
 
 
 
 
 
 
 
(32,670
)
Depreciation and amortization
 
 
 
 
 
 
 
 
(51,106
)
General and administrative expenses
 
 
 
 
 
 
 
 
(7,867
)
Income from operations of properties sold or held for sale
 
 
 
 
 
 
 
 
185

Gain on sale of real estate
 
 
 
 
 
 
 
 
3,195

Net income
 
 
 
 
 
 
 
 
12,598

Less: Net income attributable to noncontrolling interests in subsidiaries
 
 
 
 
 
 
 
 
—

Net income attributable to the controlling interests
 
 
 
 
 
 
 
 
$
12,598

 
 
 
 
 
 
 
 
 
 
Period Ended June 30, 2012
Multifamily
 
Office
 
Medical Office
 
Retail
 
Total
Same-store net operating income(3)
$
16,063

 
$
48,339

 
$
14,713

 
$
20,942

 
$
100,057

Add: Net operating income from non-same-store properties(3)
—

 
7

 
156

 
—

 
163

Total net operating income(2)
$
16,063

 
$
48,346

 
$
14,869

 
$
20,942

 
$
100,220

Add/(deduct):
 
 
 
 
 
 
 
 
 
Other income
 
 
 
 
 
 
 
 
496

Acquisition costs
 
 
 
 
 
 
 
 
(308
)
Interest expense
 
 
 
 
 
 
 
 
(31,301
)
Depreciation and amortization
 
 
 
 
 
 
 
 
(50,809
)
General and administrative expenses
 
 
 
 
 
 
 
 
(7,770
)
Income from operations of properties sold or held for sale
 
 
 
 
 
 
 
 
661

Net income
 
 
 
 
 
 
 
 
11,189

Less: Net income attributable to noncontrolling interests in subsidiaries
 
 
 
 
 
 
 
 
—

Net income attributable to the controlling interests
 
 
 
 
 
 
 
 
$
11,189





Washington Real Estate Investment Trust
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The following table contains a reconciliation of net income attributable to the controlling interests to core funds from operations for the periods presented (in thousands, except per share data):
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2013
 
2012
 
2013
 
2012
Net income attributable to the controlling interests
 
$
5,263

 
$
6,008

 
$
12,598

 
$
11,189

Add/(deduct):
 
 
 
 
 
 
 
 
Real estate depreciation and amortization
 
25,582

 
25,227

 
51,106

 
50,809

Discontinued operations:
 
 
 
 
 
 
 
 
Gain on sale of real estate
 
—

 
—

 
(3,195
)
 
—

Real estate depreciation and amortization
 
—

 
364

 
—

 
776

Funds from operations(1)
 
30,845

 
31,599

 
60,509

 
62,774

Add/(deduct):
 
 
 
 
 
 
 
 
Acquisition costs
 
87

 
254

 
300

 
308

Severance expense
 
266

 
—

 
83

 
—

Core funds from operations(1)
 
$
31,198

 
$
31,853

 
$
60,892

 
$
63,082

 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
Per share data:
 
2013
 
2012
 
2013
 
2012
Funds from operations
(Basic)
$
0.46

 
$
0.47

 
$
0.91

 
$
0.94

 
(Diluted)
$
0.46

 
$
0.47

 
$
0.91

 
$
0.94

Core FFO
(Basic)
$
0.47

 
$
0.48

 
$
0.91

 
$
0.95

 
(Diluted)
$
0.47

 
$
0.48

 
$
0.91

 
$
0.95

 
 
 
 
 
 
 
 
 
Weighted average shares outstanding
 
66,405

 
66,241

 
66,399

 
66,218

Fully diluted weighted average shares outstanding
 
66,556

 
66,380

 
66,537

 
66,354