[WASHINGTON REAL ESTATE INVESTMENT TRUST LOGO APPEARS HERE]
| WASHINGTON REAL ESTATE INVESTMENT TRUST ANNOUNCES 1ST QUARTER TOTAL NET INCOME OF $11.2 MILLION ($0.28 PER SHARE) AND FUNDS FROM OPERATIONS OF $19.3 MILLION ($0.49 PER SHARE) |
Washington Real Estate Investment Trust (WRIT) reported the following results today:
| Q1 2003 |
Q1 2002 | |||||
| Net Income Per Share |
$ |
0.28 |
$ |
0.42 | ||
| Funds from Operations (“FFO”) Per Share |
$ |
0.49 |
$ |
0.50 | ||
Net income per share for Q1 2002 included a $0.10 per share gain on property disposed in Q1 2002. There were no property dispositions in Q1 2003. A reconciliation of net income to funds from operations is provided on the attached income statement. All per share amounts are fully diluted.
Edmund B. Cronin, Jr., Chairman, President and CEO, stated, “On a national basis, with the exception of the retail property sector, real estate fundamentals continue to be weak as a result of the continued underperforming economy. Fortunately, our geographic focus in the greater Washington/Baltimore metropolitan region, diversified real estate portfolio and conservative balance sheet are serving us well. Our office and industrial properties have been more adversely affected by the soft economy while the multifamily and retail portfolios are performing relatively well. Furthermore WRIT’s dividend remains secure.”
WRIT is a self-administered, self-managed, equity real estate investment trust investing in income-producing properties in the greater Washington/Baltimore metropolitan region. WRIT owns a diversified portfolio of 60 properties consisting of 11 retail centers, 24 office properties, 16 industrial and 9 multifamily properties.
WRIT’s dividends have increased every year for 32 consecutive years. WRIT shares are publicly traded on the New York Stock Exchange (symbol: 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 this press release and the supplemental disclosures attached hereto 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, fluctuations in interest rates, availability of raw materials and labor costs, levels of competition, the effect of government regulation, the availability of capital, weather conditions, the timing and pricing of lease transactions and changes in general and local economic and real estate market conditions.
1
FOR IMMEDIATE RELEASE
Page 2 of 5
WASHINGTON REAL ESTATE INVESTMENT TRUST
FINANCIAL HIGHLIGHTS
(In thousands)
| Three Months Ended March 31, |
||||||||
| OPERATING RESULTS |
2003 |
2002 |
||||||
| Revenue |
||||||||
| Real estate rental revenue |
$ |
38,961 |
|
$ |
38,022 |
| ||
| Other income |
|
108 |
|
|
148 |
| ||
|
|
39,069 |
|
|
38,170 |
| |||
| Expenses |
||||||||
| Real estate expenses |
|
(11,603 |
) |
|
(10,525 |
) | ||
| Interest expense |
|
(7,047 |
) |
|
(6,883 |
) | ||
| Depreciation and amortization |
|
(8,073 |
) |
|
(6,950 |
) | ||
| General and administrative |
|
(1,132 |
) |
|
(1,240 |
) | ||
|
|
(27,855 |
) |
|
(25,598 |
) | |||
| Income from continuing operations |
|
11,214 |
|
|
12,572 |
| ||
| Discontinued operations: |
||||||||
| Loss from operations of property disposed |
|
— |
|
|
(82 |
) | ||
| Gain on property disposed |
|
— |
|
|
3,838 |
| ||
| Net Income |
|
11,214 |
|
|
16,328 |
| ||
| Real estate depreciation and amortization |
|
8,073 |
|
|
6,950 |
| ||
| Discontinued operations: |
||||||||
| Gain on property disposed |
|
— |
|
|
(3,838 |
) | ||
| Real estate depreciation and amortization |
|
— |
|
|
11 |
| ||
| Funds from operations(1) |
|
19,287 |
|
|
19,451 |
| ||
| Accretive: |
||||||||
| Tenant improvements |
|
(1,613 |
) |
|
(1,014 |
) | ||
| Leasing commissions capitalized |
|
(1,419 |
) |
|
(283 |
) | ||
| Non-Accretive: |
||||||||
| Recurring capital improvements |
|
(865 |
) |
|
(1,814 |
) | ||
| Straight line rents, net of reserve |
|
(318 |
) |
|
(539 |
) | ||
| Non real estate depreciation & amortization |
|
476 |
|
|
515 |
| ||
| Funds Available for Distribution(2) |
$ |
15,548 |
|
$ |
16,316 |
| ||
(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) from sales of property plus depreciation and amortization. WRIT 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 its properties without giving effect to real estate depreciation and amortization, which historically assumes that the value of real estate assets diminish predictably over time. Since real estate values have instead historically risen or fallen with market conditions, WRIT believes that FFO more accurately provides investors an indication of its ability to incur and service debt, make capital expenditures and fund other needs.
(2) Funds Available for Distribution (“FAD”) is calculated by subtracting from FFO recurring expenditures, tenant improvements and leasing costs, that are capitalized and amortized and are necessary to maintain WRIT’s properties and revenue stream and straight line rents, then adding non-real estate depreciation and amortization. FAD is included herein, because WRIT considers it to be a measure of a REIT’s ability to incur and service debt and to distribute dividends to its shareholders.
FOR IMMEDIATE RELEASE
Page 3 of 6
WASHINGTON REAL ESTATE INVESTMENT TRUST
FINANCIAL HIGHLIGHTS
| Three Months Ended March 31, | ||||||||
| Per Share Data |
2003 |
2002 | ||||||
| Income from continuing operations |
(Basic) |
$ |
0.29 |
$ |
0.32 | |||
| (Diluted) |
$ |
0.28 |
$ |
0.32 | ||||
| Gain on property disposed |
(Basic) |
$ |
0.00 |
$ |
0.10 | |||
| (Diluted) |
$ |
0.00 |
$ |
0.10 | ||||
| Net income |
(Basic) |
$ |
0.29 |
$ |
0.42 | |||
| (Diluted) |
$ |
0.28 |
$ |
0.42 | ||||
| Funds from operations |
(Basic) |
$ |
0.49 |
$ |
0.50 | |||
| (Diluted) |
$ |
0.49 |
$ |
0.50 | ||||
| Dividends paid |
$ |
0.3525 |
$ |
0.3325 | ||||
| Weighted average shares outstanding |
|
39,173,898 |
|
38,898,988 | ||||
| Fully diluted weighted average shares outstanding |
|
39,357,895 |
|
39,185,576 | ||||
FOR IMMEDIATE RELEASE
Page 4 of 6
WASHINGTON REAL ESTATE INVESTMENT TRUST
CONSOLIDATED BALANCE SHEETS
(In thousands)
| March 31, 2003 |
December 31, 2002 |
|||||||
| Assets |
||||||||
| Land |
$ |
171,514 |
|
$ |
169,045 |
| ||
| Building |
|
697,394 |
|
|
684,657 |
| ||
| Total real estate, at cost |
|
868,908 |
|
|
853,702 |
| ||
| Accumulated depreciation |
|
(154,004 |
) |
|
(146,912 |
) | ||
| Total investment in real estate, net |
|
714,904 |
|
|
706,790 |
| ||
| Cash and cash equivalents |
|
17,350 |
|
|
13,076 |
| ||
| Rents and other receivables, net of allowance for doubtful accounts of $2,531 and $2,188, respectively |
|
14,822 |
|
|
14,072 |
| ||
| Prepaid expenses and other assets |
|
21,852 |
|
|
22,059 |
| ||
| Total Assets |
$ |
768,928 |
|
$ |
755,997 |
| ||
| Liabilities |
||||||||
| Accounts payable and other liabilities |
$ |
12,887 |
|
$ |
14,661 |
| ||
| Advance rents |
|
5,440 |
|
|
4,409 |
| ||
| Tenant security deposits |
|
6,582 |
|
|
6,495 |
| ||
| Mortgage notes payable |
|
93,499 |
|
|
86,951 |
| ||
| Line of credit payable |
|
— |
|
|
50,750 |
| ||
| Notes payable |
|
325,000 |
|
|
265,000 |
| ||
| Total Liabilities |
|
443,408 |
|
|
428,266 |
| ||
| Minority interest |
|
1,565 |
|
|
1,554 |
| ||
| Shareholders’ Equity |
||||||||
| Shares of beneficial interest, $.01 par value; 100,000 |
||||||||
| shares authorized: 39,184 and 39,168 shares issued |
||||||||
| and outstanding, respectively |
|
392 |
|
|
392 |
| ||
| Additional paid-in capital |
|
329,134 |
|
|
328,797 |
| ||
| Retained earnings (deficit) |
|
(5,152 |
) |
|
(2,554 |
) | ||
| Less: Deferred compensation on restricted shares |
|
(419 |
) |
|
(458 |
) | ||
| Total Shareholders’ Equity |
|
323,955 |
|
|
326,177 |
| ||
| Total Liabilities and Shareholders’ Equity |
$ |
768,928 |
|
$ |
755,997 |
| ||
FOR IMMEDIATE RELEASE
Page 5 of 6
Occupancy Levels by Core Portfolio(1) and All Properties
| Core Portfolio |
All Properties |
|||||||||||
| 1st QTR |
1st QTR |
1st QTR |
1st QTR |
|||||||||
| Sector |
2003 |
2002 |
2003 |
2002 |
||||||||
| Multifamily |
90.9 |
% |
93.5 |
% |
90.9 |
% |
93.5 |
% | ||||
| Office Buildings |
86.9 |
% |
90.2 |
% |
87.1 |
% |
90.2 |
% | ||||
| Retail Centers |
96.0 |
% |
93.4 |
% |
96.1 |
% |
93.4 |
% | ||||
| Industrial/Flex Centers |
87.7 |
% |
97.6 |
% |
88.2 |
% |
94.8 |
% | ||||
| Overall Portfolio |
88.9 |
% |
92.2 |
% |
89.3 |
% |
91.9 |
% | ||||
2003 Acquisition Summary
| Acquisition Date |
Square Feet |
Occupied Sq. Ft. at Acquisition |
Occupancy Percentage at Acquisition |
March 31, 2003 Leased Percentage |
Investment | ||||||||||
| Fullerton Industrial Center |
1/24/2003 |
137,000 |
137,000 |
100 |
% |
100 |
% |
$ |
10,600,000 | ||||||
(1) Core portfolio properties include all properties that were owned for the entirety of the current and prior year reporting periods. For Q1 2002 and Q1 2003, core portfolio properties exclude 1501 South Capitol Street, The Atrium Building, 1620 Wilson Boulevard, Centre at Hagerstown and Fullerton Industrial Center.
Washington Real Estate Investment Trust
FOR IMMEDIATE RELEASE
Page 6 of 6
Conference Call Information
WRIT will conduct a Conference/Webcast Call to discuss 1st Quarter Earnings on Tuesday, April 22, 2003 at 11:00 AM, Eastern Time. Conference call access information is as follows:
| USA Toll Free Number: |
1-800-404-1354 | |
| International Toll Number: |
1-706-643-0825 | |
| Leader: |
Sara Grootwassink |
The instant replay of the Conference Call will be available until April 29, 2003 at 11:55 PM Eastern Time. Instant Replay access information is as follows:
| USA Toll Free Number: |
1-800-642-1687 | |
| International Toll Number: |
1-706-645-9291 | |
| Conference ID: |
9440022 |
The live on-demand webcast of the Conference Call will also be available on WRIT’s website at www.writ.com. The on-line playback of the webcast will be available at www.writ.com for 30 days following the Conference Call.
6
| Contact: |
6110 Executive Blvd | |
| Sara Grootwassink |
Suite 800 | |
| Chief Financial Officer |
Rockville, MD 20852 | |
| Direct Dial: (301) 255-0820 |
(301) 984-9400 | |
| E-mail: sgrootwassink@writ.com |
(301) 984-9610 fax |
Washington Real Estate Investment Trust
Supplemental Information
Table of Contents
March 31, 2003
| Schedule |
Page | |
| About the Trust |
2 | |
| Consolidated Statements of Operations |
3 | |
| Consolidated Balance Sheet |
4 | |
| Funds From Operations and Funds Available for Distribution |
5 | |
| Earnings Before Interest Taxes Depreciation and Amortization (EBITDA) |
6 | |
| Long-Term Debt Analysis |
7 | |
| Capital Analysis |
8 | |
| Core Portfolio Net Operating Income (NOI) Growth & Rental Rate Growth |
9 | |
| Core Portfolio Net Operating Income (NOI) |
10 | |
| Core Portfolio & Overall Occupancy Levels by Sector |
11 | |
| Schedule of Properties |
12 | |
| Schedule of Properties (continued) |
13 | |
| Commercial Leasing Summary |
14 | |
| 10 Largest Tenants—Based on Annualized Base Rent |
15 | |
| Lease Expirations as of March 31, 2003 |
16 | |
| Acquisition Summary as of March 31, 2003 |
17 | |
| Total Return Chart |
18 | |
| Reporting Definitions |
19 | |
Washington Real Estate Investment Trust
About the Trust
Mission Statement
Washington Real Estate Investment Trust, founded in 1960 and headquarted in Rockville, Maryland, invests in a diversified range of income-producing property types. Our purpose is to acquire and manage real estate investments in markets we know well and protect our assets from single property-type value fluctuations through diversified holdings. Our goal is to continue to safely increase earnings and shareholder value.
Company Background
WRIT is a self-administered, self-managed, equity real estate investment trust investing in income-producing properties in the greater Washington/Baltimore metropolitan region. The Trust owns a diversified portfolio of 60 properties consisting of 11 retail centers, 24 office properties, 16 industrial and 9 multifamily properties.
WRIT's dividends have increased every year for 32 consecutive years. WRIT's FFO per share has increased every year for 30 consecutive years. WRIT shares are publicly traded on the New York Stock Exchange (symbol: WRE).
2
Washington Real Estate Investment Trust
Consolidated Statement of Operations
(In thousands, except per share data)
| Three Months Ended |
||||||||||||||||||||
| OPERATING RESULTS |
03/31/03 |
12/31/02 |
09/30/02 |
06/30/02 |
03/31/02 |
|||||||||||||||
| Real estate rental revenue |
$ |
38,961 |
|
$ |
39,027 |
|
$ |
38,324 |
|
$ |
37,556 |
|
$ |
38,022 |
| |||||
| Real estate expenses |
|
(11,603 |
) |
|
(11,124 |
) |
|
(11,453 |
) |
|
(10,803 |
) |
|
(10,525 |
) | |||||
|
|
27,358 |
|
|
27,903 |
|
|
26,871 |
|
|
26,753 |
|
|
27,497 |
| ||||||
| Real estate depreciation and amortization |
|
(8,073 |
) |
|
(7,894 |
) |
|
(7,303 |
) |
|
(7,053 |
) |
|
(6,950 |
) | |||||
| Income from real estate |
|
19,285 |
|
|
20,009 |
|
|
19,568 |
|
|
19,700 |
|
|
20,547 |
| |||||
| Other income |
|
108 |
|
|
127 |
|
|
177 |
|
|
228 |
|
|
148 |
| |||||
| Interest expense |
|
(7,047 |
) |
|
(7,010 |
) |
|
(7,068 |
) |
|
(6,888 |
) |
|
(6,883 |
) | |||||
| General and administrative |
|
(1,132 |
) |
|
(1,074 |
) |
|
(1,034 |
) |
|
(1,227 |
) |
|
(1,240 |
) | |||||
| Income from continuing operations |
|
11,214 |
|
|
12,052 |
|
|
11,643 |
|
|
11,813 |
|
|
12,572 |
| |||||
| Discontinued operations: |
||||||||||||||||||||
| Income (loss) from operations of disposed property |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(82 |
) | |||||
| Gain on property disposed |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
3,838 |
| |||||
| Net Income |
$ |
11,214 |
|
$ |
12,052 |
|
$ |
11,643 |
|
$ |
11,813 |
|
$ |
16,328 |
| |||||
| Per Share Data |
||||||||||||||||||||
| Income from continuing operations |
$ |
0.28 |
|
$ |
0.31 |
|
$ |
0.30 |
|
$ |
0.30 |
|
$ |
0.32 |
| |||||
| Net Income |
$ |
0.28 |
|
$ |
0.31 |
|
$ |
0.30 |
|
$ |
0.30 |
|
$ |
0.42 |
| |||||
| Fully diluted weighted average shares outstanding |
|
39,357,895 |
|
|
39,328,198 |
|
|
39,358,143 |
|
|
39,348,732 |
|
|
39,185,576 |
| |||||
| Percentage of Revenues: |
||||||||||||||||||||
| Real estate expenses |
|
29.8% |
|
|
28.5% |
|
|
29.9% |
|
|
28.8% |
|
|
27.7% |
| |||||
| General and administrative |
|
2.9% |
|
|
2.8% |
|
|
2.7% |
|
|
3.3% |
|
|
3.3% |
| |||||
| Ratios: |
||||||||||||||||||||
| EBITDA / Interest Expense |
|
3.6x |
|
|
3.9x |
|
|
3.7x |
|
|
3.7x |
|
|
3.8x |
| |||||
| Income from continuing operations / |
|
28.8% |
|
|
30.9% |
|
|
30.4% |
|
|
31.5% |
|
|
33.1% |
| |||||
| Earnings to Fixed Charges |
|
2.6x |
|
|
2.7x |
|
|
2.6x |
|
|
2.7x |
|
|
2.8x |
| |||||
3
Washington Real Estate Investment Trust
Consolidated Balance Sheet
(In thousands)
| March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
||||||||||||||||
| 2003 |
2002 |
2002 |
2002 |
2002 |
||||||||||||||||
| Assets |
||||||||||||||||||||
| Land |
$ |
171,514 |
|
$ |
169,045 |
|
$ |
169,045 |
|
$ |
165,863 |
|
$ |
152,835 |
| |||||
| Building |
|
697,394 |
|
|
684,657 |
|
|
679,365 |
|
|
660,314 |
|
|
625,374 |
| |||||
| Total real estate, at cost |
|
868,908 |
|
|
853,702 |
|
|
848,410 |
|
|
826,177 |
|
|
778,209 |
| |||||
| Accumulated depreciation |
|
(154,004 |
) |
|
(146,912 |
) |
|
(139,965 |
) |
|
(133,219 |
) |
|
(126,788 |
) | |||||
| Total investment in real estate, net |
|
714,904 |
|
|
706,790 |
|
|
708,445 |
|
|
692,958 |
|
|
651,421 |
| |||||
| Cash and cash equivalents |
|
17,350 |
|
|
13,076 |
|
|
15,818 |
|
|
24,129 |
|
|
30,509 |
| |||||
| Rents and other receivables, |
|
14,822 |
|
|
14,072 |
|
|
12,617 |
|
|
12,481 |
|
|
11,088 |
| |||||
| Prepaid expenses and other assets |
|
21,852 |
|
|
22,059 |
|
|
21,083 |
|
|
16,604 |
|
|
18,248 |
| |||||
| Total Assets |
$ |
768,928 |
|
$ |
755,997 |
|
$ |
757,963 |
|
$ |
746,172 |
|
$ |
711,266 |
| |||||
| Liabilities |
||||||||||||||||||||
| Accounts payable and other liabilities |
$ |
12,887 |
|
$ |
14,661 |
|
$ |
11,869 |
|
$ |
14,522 |
|
$ |
11,564 |
| |||||
| Advance rents |
|
5,440 |
|
|
4,409 |
|
|
4,172 |
|
|
3,006 |
|
|
2,953 |
| |||||
| Tenant security deposits |
|
6,582 |
|
|
6,495 |
|
|
6,442 |
|
|
6,302 |
|
|
6,184 |
| |||||
| Mortgage notes payable |
|
93,499 |
|
|
86,951 |
|
|
87,197 |
|
|
94,159 |
|
|
94,445 |
| |||||
| Lines of credit payable |
|
— |
|
|
50,750 |
|
|
53,750 |
|
|
32,000 |
|
|
— |
| |||||
| Notes payable |
|
325,000 |
|
|
265,000 |
|
|
265,000 |
|
|
265,000 |
|
|
265,000 |
| |||||
| Total Liabilities |
|
443,408 |
|
|
428,266 |
|
|
428,430 |
|
|
414,989 |
|
|
380,146 |
| |||||
| Minority interest |
|
1,565 |
|
|
1,554 |
|
|
1,554 |
|
|
1,542 |
|
|
1,658 |
| |||||
| Shareholders' Equity |
||||||||||||||||||||
| Shares of beneficial interest, $.01 par value; |
$ |
392 |
|
$ |
392 |
|
$ |
391 |
|
$ |
391 |
|
$ |
390 |
| |||||
| Additional paid-in capital |
|
329,134 |
|
|
328,797 |
|
|
328,387 |
|
|
327,893 |
|
|
325,741 |
| |||||
| Retained earnings (deficit) |
|
(5,152 |
) |
|
(2,554 |
) |
|
(799 |
) |
|
1,357 |
|
|
3,331 |
| |||||
| Less: Deferred Compensation on restricted shares |
|
(419 |
) |
|
(458 |
) |
|
— |
|
|
— |
|
|
— |
| |||||
| Total Shareholders' Equity |
|
323,955 |
|
|
326,177 |
|
|
327,979 |
|
|
329,641 |
|
|
329,462 |
| |||||
| Total Liabilities and Shareholders' Equity |
$ |
768,928 |
|
$ |
755,997 |
|
$ |
757,963 |
|
$ |
746,172 |
|
$ |
711,266 |
| |||||
| Total Debt / Total Market Capitalization |
|
0.29:1 |
|
|
0.29:1 |
|
|
0.29:1 |
|
|
0.26:1 |
|
|
0.24:1 |
| |||||
4
Washington Real Estate Investment Trust
Funds From Operations and Funds Available for Distribution
(In thousands, except per share data)
| Three Months Ended |
||||||||||||||||||||
| 03/31/03 |
12/31/02 |
09/30/02 |
06/30/02 |
03/31/02 |
||||||||||||||||
| Funds From Operations(1) |
||||||||||||||||||||
| Net Income |
$ |
11,214 |
|
$ |
12,052 |
|
$ |
11,643 |
|
$ |
11,813 |
|
$ |
16,328 |
| |||||
| Real estate depreciation and amortization |
|
8,073 |
|
|
7,894 |
|
|
7,303 |
|
|
7,053 |
|
|
6,950 |
| |||||
| Gain on sale of real estate investment |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
| |||||
| Discontinued operations: |
||||||||||||||||||||
| Gain on property disposed |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(3,838 |
) | |||||
| Real estate depreciation and amortization |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
11 |
| |||||
| Funds From Operations (FFO) |
|
19,287 |
|
|
19,946 |
|
|
18,946 |
|
|
18,866 |
|
|
19,451 |
| |||||
| FFO per share—basic |
$ |
0.49 |
|
$ |
0.51 |
|
$ |
0.48 |
|
$ |
0.48 |
|
$ |
0.50 |
| |||||
| FFO per share—fully diluted |
$ |
0.49 |
|
$ |
0.51 |
|
$ |
0.48 |
|
$ |
0.48 |
|
$ |
0.50 |
| |||||
| Funds Available for Distribution(2) |
||||||||||||||||||||
| Accretive: |
||||||||||||||||||||
| Tenant Improvements |
|
(1,613 |
) |
|
(1,267 |
) |
|
(1,095 |
) |
|
(1,280 |
) |
|
(1,014 |
) | |||||
| Leasing Commissions Capitalized |
|
(1,419 |
) |
|
(496 |
) |
|
(258 |
) |
|
(381 |
) |
|
(283 |
) | |||||
| Non-Accretive: |
||||||||||||||||||||
| Recurring Capital Improvements |
|
(865 |
) |
|
(2,475 |
) |
|
(2,132 |
) |
|
(1,647 |
) |
|
(1,814 |
) | |||||
| Straight-Line Rent, Net |
|
(318 |
) |
|
(484 |
) |
|
(338 |
) |
|
(487 |
) |
|
(539 |
) | |||||
| Non RE Depreciation & Amortization |
|
476 |
|
|
501 |
|
|
491 |
|
|
488 |
|
|
515 |
| |||||
| Funds Available for Distribution (FAD) |
$ |
15,548 |
|
$ |
15,725 |
|
$ |
15,614 |
|
$ |
15,559 |
|
$ |
16,316 |
| |||||
| Average shares—basic |
|
39,173,898 |
|
|
39,150,598 |
|
|
39,133,714 |
|
|
39,055,523 |
|
|
38,898,988 |
| |||||
| Average shares—fully diluted |
|
39,357,895 |
|
|
39,328,198 |
|
|
39,358,143 |
|
|
39,348,732 |
|
|
39,185,576 |
| |||||
(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) from sales of property plus depreciation and amortization. WRIT considers FFO to be a standard supplemental measure for equity real estate investment trusts (“REITs”) because it facilitates an understanding of the operating performance of its properties without giving effect to real estate depreciation and amortization, which historically assumes that the value of real estate assets diminish predictably over time. Since real estate values have instead historically risen or fallen with market conditions, WRIT believes that FFO more accurately provides investors an indication of its ability to incur and service debt, make capital expenditures and fund other needs.
(2) Funds Available for Distribution (“FAD”) is calculated by subtracting from FFO recurring expenditures, tenant improvements and leasing costs, that are capitalized and amortized and are necessary to maintain WRIT’s properties and revenue stream and straight line rents, then adding non-real estate depreciation and amortization. FAD is included herein, because WRIT considers it to be a measure of a REIT’s ability to incur and service debt and to distribute dividends to its shareholders.
5
Washington Real Estate Investment Trust
Earnings Before Interest Taxes Depreciation and Amortization (EBITDA)
(In thousands)
| Three Months Ended |
||||||||||||||||||||
| 03/31/03 |
12/31/02 |
09/30/02 |
06/30/02 |
03/31/02 |
||||||||||||||||
| EBITDA(1) |
||||||||||||||||||||
| Net income |
$ |
11,214 |
|
$ |
12,052 |
|
$ |
11,643 |
|
$ |
11,813 |
|
$ |
16,328 |
| |||||
| Add: |
||||||||||||||||||||
| Interest expense |
|
7,047 |
|
|
7,010 |
|
|
7,068 |
|
|
6,888 |
|
|
6,883 |
| |||||
| Real estate depreciation and amortization |
|
8,073 |
|
|
7,894 |
|
|
7,303 |
|
|
7,053 |
|
|
6,950 |
| |||||
| Non-real estate depreciation |
|
149 |
|
|
203 |
|
|
200 |
|
|
203 |
|
|
201 |
| |||||
| Less: |
||||||||||||||||||||
| Gain on sale of real estate investment |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(3,838 |
) | |||||
| Other income |
|
(108 |
) |
|
(127 |
) |
|
(177 |
) |
|
(228 |
) |
|
(148 |
) | |||||
| EBITDA |
$ |
26,375 |
|
$ |
27,032 |
|
$ |
26,037 |
|
$ |
25,729 |
|
$ |
26,376 |
| |||||
(1) EBITDA is earnings before interest, taxes, depreciation and amortization. WRIT considers EBITDA to be an appropriate supplemental performance measure because it eliminates depreciation, interest and the gain (loss) from property dispositions, which permits investors to view income from operations without the effect of non-cash depreciation or the cost of debt.
6
Washington Real Estate Investment Trust
Long-Term Debt Analysis
(In thousands, except per share amounts)
| March 31, |
December 31, |
September 30, |
June 30, |
March 31, | |||||||||||
| 2003 |
2002 |
2002 |
2002 |
2002 | |||||||||||
| Balances Outstanding |
|||||||||||||||
| Secured |
|||||||||||||||
| Conventional fixed rate |
$ |
93,499 |
$ |
86,951 |
$ |
87,197 |
$ |
94,159 |
$ |
94,445 | |||||
| Secured total |
|
93,499 |
|
86,951 |
|
87,197 |
|
94,159 |
|
94,445 | |||||
| Unsecured |
|||||||||||||||
| Fixed rate bonds and notes |
|
325,000 |
|
265,000 |
|
265,000 |
|
265,000 |
|
265,000 | |||||
| Credit facility |
|
— |
|
50,750 |
|
53,750 |
|
32,000 |
|
— | |||||
| Unsecured total |
|
325,000 |
|
315,750 |
|
318,750 |
|
297,000 |
|
265,000 | |||||
| Total |
$ |
418,499 |
$ |
402,701 |
$ |
405,947 |
$ |
391,159 |
$ |
359,445 | |||||
| Average Interest Rates |
|||||||||||||||
| Secured |
|||||||||||||||
| Conventional fixed rate |
|
7.2% |
|
7.3% |
|
7.3% |
|
7.4% |
|
7.4% | |||||
| Secured total |
|
7.2% |
|
7.3% |
|
7.3% |
|
7.4% |
|
7.4% | |||||
| Unsecured |
|||||||||||||||
| Fixed rate bonds |
|
7.0% |
|
7.4% |
|
7.4% |
|
7.4% |
|
7.4% | |||||
| Credit facilities |
|
0.0% |
|
2.1% |
|
2.5% |
|
2.6% |
|
0.0% | |||||
| Unsecured total |
|
7.0% |
|
6.5% |
|
6.6% |
|
6.9% |
|
7.4% | |||||
| Average |
|
7.0% |
|
6.7% |
|
6.7% |
|
6.5% |
|
7.4% | |||||
Maturity Schedule
| Future Maturities of Debt |
||||||||||||
| Average |
||||||||||||
| Year |
Secured Debt |
Unsecured Debt |
Total Debt |
Interest Rate |
||||||||
| 2003 |
$ |
903 |
$ |
50,000 |
$ |
50,903 |
7.4 |
% | ||||
| 2004 |
|
1,283 |
|
55,000 |
|
56,283 |
7.9 |
% | ||||
| 2005 |
|
26,819 |
|
— |
|
26,819 |
7.7 |
% | ||||
| 2006 |
|
6,648 |
|
50,000 |
|
56,648 |
7.0 |
% | ||||
| 2007 |
|
7,846 |
|
— |
|
7,846 |
6.8 |
% | ||||
| 2008 |
|
— |
|
60,000 |
|
60,000 |
6.7 |
% | ||||
| 2009 |
|
50,000 |
|
— |
|
50,000 |
7.1 |
% | ||||
| 2010 |
|
— |
|
— |
|
— |
0.0 |
% | ||||
| 2011 |
|
— |
|
— |
|
— |
0.0 |
% | ||||
| Thereafter |
|
— |
|
110,000 |
|
110,000 |
6.4 |
% | ||||
| Total maturities |
$ |
93,499 |
$ |
325,000 |
$ |
418,499 |
7.0 |
% | ||||
Weighted average maturity = 8.0 years
7
Washington Real Estate Investment Trust
Capital Analysis
(In thousands, except per share amounts)
| March 31, |
December 31, |
September 30, |
June 30, |
March 31, | |||||||||||
| 2003 |
2002 |
2002 |
2002 |
2002 | |||||||||||
| Market Data |
|||||||||||||||
| Shares Outstanding |
|
39,184 |
|
39,168 |
|
39,146 |
|
39,114 |
|
38,988 | |||||
| Market Price per Share |
$ |
25.97 |
$ |
25.50 |
$ |
25.38 |
$ |
28.90 |
$ |
28.75 | |||||
| Equity Market Capitalization |
$ |
1,017,608 |
$ |
998,784 |
$ |
993,525 |
$ |
1,130,395 |
$ |
1,120,905 | |||||
| Total Debt |
$ |
418,499 |
$ |
402,701 |
$ |
405,947 |
$ |
391,159 |
$ |
359,445 | |||||
| Total Market Capitalization |
$ |
1,436,101 |
$ |
1,401,485 |
$ |
1,399,472 |
$ |
1,521,554 |
$ |
1,480,350 | |||||
| Total Debt to Market Capitalization |
|
0.29:1 |
|
0.29:1 |
|
0.29:1 |
|
0.26:1 |
|
0.24:1 | |||||
| Earnings to Fixed Charges |
|
2.6x |
|
2.7x |
|
2.6x |
|
2.7x |
|
2.8x | |||||
| Debt Service Coverage Ratio |
|
3.6x |
|
3.7x |
|
3.6x |
|
3.6x |
|
3.7x | |||||
| Dividend Data |
|||||||||||||||
| Total Dividends Paid |
$ |
13,812 |
$ |
13,806 |
$ |
13,799 |
$ |
13,788 |
$ |
12,959 | |||||
| Common Dividend per Share |
$ |
0.3525 |
$ |
0.3525 |
$ |
0.3525 |
$ |
0.3525 |
$ |
0.3325 | |||||
| Payout Ratio (FFO per share basis) |
|
71.9% |
|
69.1% |
|
73.4% |
|
73.4% |
|
67.0% | |||||
8
Washington Real Estate Investment Trust
Core Portfolio Net Operating Income (NOI) Growth & Rental Rate Growth
Q1 2003 vs. Q1 2002
Cash Basis
| NOI |
Rental Rate | |||
| Sector |
Growth |
Growth | ||
| Multifamily(1) |
-3.4% |
4.3% | ||
| Office Buildings |
-5.0% |
1.6% | ||
| Retail Centers |
-5.5% |
2.0% | ||
| Industrial / Flex Properties |
-7.1% |
4.7% | ||
| Overall Core Portfolio |
-5.2% |
2.6% |
GAAP Basis
| NOI |
Rental Rate | |||
| Sector |
Growth |
Growth | ||
| Multifamily(1) |
-3.5% |
4.3% | ||
| Office Buildings |
-6.9% |
0.9% | ||
| Retail Centers |
-6.3% |
2.1% | ||
| Industrial / Flex Properties |
-8.9% |
3.9% | ||
| Overall Core Portfolio |
-6.5% |
2.1% |
(1) NOI for Multifamily and Core Porfolio for Q1 03 would be as follows without the impact of the 23 HUD units taken off the market at The Ashby at McLean for complete renovation:
| GAAP Basis |
Cash Basis | |||
| Multifamily |
-1.7% |
-1.6% | ||
| Overall Core Portfolio |
-6.2% |
-4.8% |
9
Washington Real Estate Investment Trust
Core Portfolio Net Operating Income (NOI)
(In Thousands)
| Three Months Ended March 31, |
||||||||
| 2003 |
2002 |
|||||||
| Net income |
$ |
11,214 |
|
$ |
16,328 |
| ||
| Real estate depreciation and amortization |
|
8,073 |
|
|
6,950 |
| ||
| Discontinued operations: |
||||||||
| Gain on property disposed |
|
— |
|
|
(3,838 |
) | ||
| Real estate depreciation and amortization |
|
— |
|
|
11 |
| ||
| Funds From Operations |
|
19,287 |
|
|
19,451 |
| ||
| Add: |
||||||||
| General and administrative |
|
1,132 |
|
|
1,240 |
| ||
| Interest expense |
|
7,047 |
|
|
6,883 |
| ||
| Less: |
||||||||
| NOI for non-core properties(1) |
|
(1,779 |
) |
|
(64 |
) | ||
| Other income |
|
(108 |
) |
|
(148 |
) | ||
| Core portfolio NOI, GAAP Basis |
|
25,579 |
|
|
27,362 |
| ||
| Straight-line revenue, net for core properties |
|
(123 |
) |
|
(521 |
) | ||
| Core portfolio NOI, Cash Basis |
$ |
25,456 |
|
$ |
26,841 |
| ||
| Core portfolio NOI by segment: |
||||||||
| GAAP Basis: |
||||||||
| Multifamily |
$ |
4,421 |
|
$ |
4,580 |
| ||
| Office Buildings |
|
13,096 |
|
|
14,061 |
| ||
| Retail Centers |
|
4,181 |
|
|
4,463 |
| ||
| Industrial/Flex |
|
3,881 |
|
|
4,258 |
| ||
| $ |
25,579 |
|
$ |
27,362 |
| |||
| Cash Basis: |
||||||||
| Multifamily |
$ |
4,420 |
|
$ |
4,573 |
| ||
| Office Buildings |
|
13,016 |
|
|
13,708 |
| ||
| Retail Centers |
|
4,149 |
|
|
4,391 |
| ||
| Industrial/Flex |
|
3,871 |
|
|
4,169 |
| ||
| $ |
25,456 |
|
$ |
26,841 |
| |||
(1) Non-core properties for Q1 2003 and Q1 2002 were 1501 South Capitol Street, The Atrium Building, 1620 Wilson Boulevard, Centre at Hagerstown and Fullerton Industrial Center.
10
Washington Real Estate Investment Trust
Core Portfolio & Overall Occupancy Levels by Sector
Q1 2003 vs. Q1 2002
GAAP Basis
| Core Portfolio |
All Properties |
|||||||||||
| 1st QTR |
1st QTR |
1st QTR |
1st QTR |
|||||||||
| Sector |
2003 |
2002 |
2003 |
2002 |
||||||||
| Multifamily (1) |
90.9 |
% |
93.5 |
% |
90.9 |
% |
93.5 |
% | ||||
| Office Buildings |
86.9 |
% |
90.2 |
% |
87.1 |
% |
90.2 |
% | ||||
| Retail Centers |
96.0 |
% |
93.4 |
% |
96.1 |
% |
93.4 |
% | ||||
| Industrial / Flex Properties |
87.7 |
% |
97.6 |
% |
88.2 |
% |
94.8 |
% | ||||
| Overall Portfolio(2) |
88.9 |
% |
92.2 |
% |
89.3 |
% |
91.9 |
% | ||||
(1) Multifamily occupancy for the Core Portfolio and All Properties would be 92.0% without the 23 HUD units at The Ashby at McLean taken off the market for complete renovation.
(2) Overall Portfolio occupancy for the Core Portfolio and All Properties would be 89.1% and 89.5% without the impact of the 23 former HUD units at The Ashby at McLean taken off the market for complete renovation.
11
Washington Real Estate Investment Trust
Schedule of Properties
March 31, 2003
| YEAR |
YEAR |
NET RENTABLE | ||||||
| PROPERTIES |
LOCATION |
ACQUIRED |
CONSTRUCTED |
SQUARE FEET | ||||
| Office Buildings |
||||||||
| 1901 Pennsylvania Avenue |
Washington, DC |
1977 |
1960 |
97,000 | ||||
| 51 Monroe Street |
Rockville, MD |
1979 |
1975 |
210,000 | ||||
| 7700 Leesburg Pike |
Falls Church, VA |
1990 |
1976 |
147,000 | ||||
| 515 King Street |
Alexandria, VA |
1992 |
1966 |
78,000 | ||||
| The Lexington Building |
Rockville, MD |
1993 |
1970 |
46,000 | ||||
| The Saratoga Building |
Rockville, MD |
1993 |
1977 |
59,000 | ||||
| Brandywine Center |
Rockville, MD |
1993 |
1969 |
35,000 | ||||
| Tycon Plaza II |
Vienna, VA |
1994 |
1981 |
127,000 | ||||
| Tycon Plaza III |
Vienna, VA |
1994 |
1978 |
151,000 | ||||
| 6110 Executive Boulevard |
Rockville, MD |
1995 |
1971 |
199,000 | ||||
| 1220 19th Street |
Washington, DC |
1995 |
1976 |
102,000 | ||||
| Maryland Trade Center I |
Greenbelt, MD |
1996 |
1981 |
190,000 | ||||
| Maryland Trade Center II |
Greenbelt, MD |
1996 |
1984 |
158,000 | ||||
| 1600 Wilson Boulevard |
Arlington, VA |
1997 |
1973 |
166,000 | ||||
| 7900 Westpark Drive |
McLean, VA |
1997 |
1972/1986/19991 |
526,000 | ||||
| 8230 Boone Boulevard |
Vienna, VA |
1998 |
1981 |
58,000 | ||||
| Woodburn Medical Park I |
Annandale, VA |
1998 |
1984 |
71,000 | ||||
| Woodburn Medical Park II |
Annandale, VA |
1998 |
1988 |
96,000 | ||||
| 600 Jefferson Plaza |
Rockville, MD |
1999 |
1985 |
115,000 | ||||
| 1700 Research Boulevard |
Rockville, MD |
1999 |
1982 |
103,000 | ||||
| Parklawn Plaza |
Rockville, MD |
1999 |
1986 |
40,000 | ||||
| Wayne Plaza |
Silver Spring, MD |
2000 |
1970 |
91,000 | ||||
| Courthouse Square |
Alexandria, VA |
2000 |
1979 |
113,000 | ||||
| One Central Plaza |
Rockville, MD |
2001 |
1974 |
267,000 | ||||
| The Atrium Building |
Rockville, MD |
2002 |
1980 |
81,000 | ||||
| Subtotal |
3,326,000 | |||||||
| Retail Centers |
||||||||
| Takoma Park |
Takoma Park, MD |
1963 |
1962 |
51,000 | ||||
| Westminster |
Westminster, MD |
1972 |
1969 |
146,000 | ||||
| Concord Centre |
Springfield, VA |
1973 |
1960 |
76,000 | ||||
| Wheaton Park |
Wheaton, MD |
1977 |
1967 |
72,000 | ||||
| Bradlee |
Alexandria, VA |
1984 |
1955 |
168,000 | ||||
| Chevy Chase Metro Plaza |
Washington, DC |
1985 |
1975 |
50,000 | ||||
| Montgomery Village Center |
Gaithersburg, MD |
1992 |
1969 |
198,000 | ||||
| Shoppes of Foxchase |
Alexandria, VA |
1994 |
1960 |
128,000 | ||||
| Frederick County Square |
Frederick, MD |
1995 |
1973 |
235,000 | ||||
| 800 S. Washington Street |
Alexandria, VA |
1998 |
1955/1959 |
51,000 | ||||
| 1620 Wilson Boulevard |
Arlington, VA |
2002 |
1959 |
5,000 | ||||
| Centre at Hagerstown |
Hagerstown, MD |
2002 |
2000 |
334,000 | ||||
| Subtotal |
1,514,000 | |||||||
12
Washington Real Estate Investment Trust
Schedule of Properties (Cont.)
March 31, 2003
| YEAR |
YEAR |
NET RENTABLE* | ||||||
| PROPERTIES |
LOCATION |
ACQUIRED |
CONSTRUCTED |
SQUARE FEET | ||||
| Multifamily Buildings / # units |
||||||||
| 3801 Connecticut Avenue / 307 |
Washington, DC |
1963 |
1951 |
177,000 | ||||
| Roosevelt Towers / 190 |
Falls Church, VA |
1965 |
1964 |
168,000 | ||||
| Country Club Towers / 227 |
Arlington, VA |
1969 |
1965 |
159,000 | ||||
| Park Adams / 200 |
Arlington, VA |
1969 |
1959 |
172,000 | ||||
| Munson Hill Towers / 279 |
Falls Church, VA |
1970 |
1963 |
259,000 | ||||
| The Ashby at McLean / 250 |
McLean, VA |
1996 |
1982 |
244,000 | ||||
| Walker House Apartments / 196 |
Gaithersburg, MD |
1996 |
1971 |
145,000 | ||||
| Bethesda Hills Apartments / 194 |
Bethesda, MD |
1997 |
1986 |
226,000 | ||||
| Avondale / 236 |
Laurel, MD |
1999 |
1987 |
170,000 | ||||
| Subtotal (2,079 units) |
1,720,000 | |||||||
| Industrial Distribution / Flex Properties |
||||||||
| Fullerton Business Center |
Springfield, VA |
1985 |
1980 |
104,000 | ||||
| Pepsi-Cola Distribution Center |
Forestville, MD |
1987 |
1971 |
69,000 | ||||
| Charleston Business Center |
Rockville, MD |
1993 |
1973 |
85,000 | ||||
| Tech 100 Industrial Park |
Elkridge, MD |
1995 |
1990 |
167,000 | ||||
| Crossroads Distribution Center |
Elkridge, MD |
1995 |
1987 |
85,000 | ||||
| The Alban Business Center |
Springfield, VA |
1996 |
1981/1982 |
87,000 | ||||
| The Earhart Building |
Chantilly, VA |
1996 |
1987 |
90,000 | ||||
| Ammendale Technology Park I |
Beltsville, MD |
1997 |
1985 |
167,000 | ||||
| Ammendale Technology Park II |
Beltsville, MD |
1997 |
1986 |
108,000 | ||||
| Pickett Industrial Park |
Alexandria, VA |
1997 |
1973 |
246,000 | ||||
| Northern Virginia Industrial Park |
Lorton, VA |
1998 |
1968/1991 |
788,000 | ||||
| 8900 Telegraph Road |
Lorton, VA |
1998 |
1985 |
32,000 | ||||
| Dulles South IV |
Chantilly, VA |
1999 |
1988 |
83,000 | ||||
| Sully Square |
Chantilly, VA |
1999 |
1986 |
95,000 | ||||
| Amvax |
Beltsville, MD |
1999 |
1986 |
31,000 | ||||
| Sullyfield Center |
Chantilly, VA |
2001 |
1985 |
245,000 | ||||
| Fullerton Industrial Center |
Springfield, VA |
2003 |
1980 |
137,000 | ||||
| Subtotal |
2,619,000 | |||||||
| TOTAL |
9,179,000 | |||||||
* Multifamily buildings are presented in gross square feet.
13
Washington Real Estate Investment Trust
Commercial Leasing Summary
Three months ended March 31, 2003
| 1st Quarter 2003 | ||||||
| Gross Leasing Square Footage |
||||||
| Office Buildings |
332,933 | |||||
| Retail Centers |
20,468 | |||||
| Industrial Centers |
60,318 | |||||
| Total |
413,719 | |||||
| Weighted Average Term (yrs) |
||||||
| Office Buildings |
5.5 | |||||
| Retail Centers |
4.9 | |||||
| Industrial Centers |
4.2 | |||||
| Total |
5.3 | |||||
| Rental Rate Increases: |
GAAP |
CASH | ||||
| Rate on expiring leases |
||||||
| Office Buildings |
$ |
24.29 |
$ |
25.35 | ||
| Retail Centers |
$ |
17.72 |
$ |
18.11 | ||
| Industrial Centers |
$ |
7.25 |
$ |
7.46 | ||
| Total |
$ |
21.48 |
$ |
22.38 | ||
| Rate on new and renewal leases |
||||||
| Office Buildings |
$ |
28.04 |
$ |
26.52 | ||
| Retail Centers |
$ |
23.41 |
$ |
22.35 | ||
| Industrial Centers |
$ |
8.47 |
$ |
7.99 | ||
| Total |
$ |
24.95 |
$ |
23.61 | ||
| Percentage Increase |
||||||
| Office Buildings |
|
15.44% |
|
4.62% | ||
| Retail Centers |
|
32.11% |
|
23.41% | ||
| Industrial Centers |
|
16.83% |
|
7.10% | ||
| Total |
|
16.15% |
|
5.50% | ||
| Total Dollars |
Square Foot | |||||
| Tenant Improvements and Leasing Costs |
||||||
| Office Buildings |
$ |
6,977,049 |
$ |
20.96 | ||
| Retail Centers |
$ |
120,438 |
$ |
5.88 | ||
| Industrial Centers |
$ |
204,450 |
$ |
3.39 | ||
| Total |
$ |
7,301,938 |
$ |
17.65 | ||
14
Washington Real Estate Investment Trust
10 Largest Tenants—Based on Annualized Base Rent
March 31, 2003
| Weighted |
Percentage |
Percentage | ||||||||
| Average |
of Aggregate |
of Aggregate | ||||||||
| Remaining |
Portfolio |
Aggregate |
Occupied | |||||||
| Number of |
Lease Term |
Annualized |
Rentable |
Square | ||||||
| Tenant |
Buildings |
in Months |
Rent |
Square Feet |
Feet | |||||
| Sunrise Senior Living, Inc. |
1 |
126 |
3.86% |
165,113 |
2.53% | |||||
| Lockheed Corporation |
2 |
15 |
3.33% |
168,330 |
2.58% | |||||
| General Services Administration |
7 |
29 |
3.00% |
274,265 |
4.20% | |||||
| SunTrust Bank |
4 |
23 |
2.55% |
104,291 |
1.60% | |||||
| Sun Microsystems, Inc. |
1 |
45 |
2.53% |
110,184 |
1.69% | |||||
| Xerox Corporation |
1 |
17 |
2.53% |
90,994 |
1.39% | |||||
| INOVA Health Systems |
2 |
76 |
1.41% |
53,196 |
0.81% | |||||
| United Communications Group |
1 |
62 |
1.40% |
62,493 |
0.96% | |||||
| Northrop-Grumman(1) |
2 |
15 |
1.27% |
58,292 |
0.89% | |||||
| IQ Solutions |
1 |
98 |
1.18% |
46,396 |
0.71% | |||||
| Total/Weighted Average |
23.06% |
1,133,554 |
17.36% | |||||||
(1) In January, 2003, Northrop-Grumman signed a lease for a 20,000 square foot expansion effective April 2003 at $24.50 per square foot. This expansion is not included in the above calculation.
15
Washington Real Estate Investment Trust
Lease Expirations
March 31, 2003
| Percent of |
Average |
Percent of | ||||||||||||
| Number of |
Rentable |
Rentable |
Annualized |
Rental |
Annualized | |||||||||
| Year |
Leases |
Square Feet |
Square Feet |
Base Rent |
Rate |
Rent | ||||||||
| Office: |
||||||||||||||
| 2003 |
123 |
395,572 |
13.8% |
$ |
9,890,230 |
$ |
25.00 |
13.4% | ||||||
| 2004 |
110 |
791,245 |
27.7% |
|
20,055,464 |
|
25.35 |
27.1% | ||||||
| 2005 |
107 |
289,836 |
10.1% |
|
7,643,851 |
|
26.37 |
10.3% | ||||||
| 2006 |
83 |
445,894 |
15.6% |
|
11,720,836 |
|
26.29 |
15.9% | ||||||
| 2007 |
49 |
223,053 |
7.8% |
|
5,366,729 |
|
24.06 |
7.3% | ||||||
| 2008 and thereafter |
91 |
713,898 |
25.0% |
|
19,202,706 |
|
26.90 |
26.0% | ||||||
| 563 |
2,859,498 |
100.0% |
$ |
73,879,815 |
$ |
25.84 |
100.0% | |||||||
| Retail: |
||||||||||||||
| 2003 |
35 |
176,282 |
12.6% |
$ |
1,526,716 |
$ |
8.66 |
7.3% | ||||||
| 2004 |
39 |
150,284 |
10.8% |
|
2,046,279 |
|
13.62 |
9.8% | ||||||
| 2005 |
41 |
196,524 |
14.1% |
|
3,362,645 |
|
17.11 |
16.0% | ||||||
| 2006 |
38 |
133,838 |
9.6% |
|
2,504,489 |
|
18.71 |
11.9% | ||||||
| 2007 |
38 |
128,658 |
9.2% |
|
2,786,282 |
|
21.66 |
13.3% | ||||||
| 2008 and thereafter |
77 |
612,367 |
43.8% |
|
8,749,103 |
|
14.29 |
41.7% | ||||||
| 268 |
1,397,953 |
100.0% |
$ |
20,975,514 |
$ |
15.00 |
100.0% | |||||||
| Industrial: |
||||||||||||||
| 2003 |
37 |
324,024 |
14.3% |
$ |
2,901,238 |
$ |
8.95 |
16.3% | ||||||
| 2004 |
46 |
452,986 |
19.9% |
|
3,204,095 |
|
7.07 |
18.1% | ||||||
| 2005 |
38 |
458,005 |
20.1% |
|
3,079,454 |
|
6.72 |
17.3% | ||||||
| 2006 |
30 |
375,266 |
16.5% |
|
3,465,071 |
|
9.23 |
19.5% | ||||||
| 2007 |
15 |
204,736 |
9.0% |
|
1,535,438 |
|
7.50 |
8.7% | ||||||
| 2008 and thereafter |
28 |
458,098 |
20.2% |
|
3,564,474 |
|
7.78 |
20.1% | ||||||
| 194 |
2,273,115 |
100.0% |
$ |
17,749,769 |
$ |
7.81 |
100.0% | |||||||
| Total: |
||||||||||||||
| 2003 |
195 |
895,878 |
13.7% |
$ |
14,318,184 |
$ |
15.98 |
12.7% | ||||||
| 2004 |
195 |
1,394,515 |
21.4% |
|
25,305,838 |
|
18.15 |
22.5% | ||||||
| 2005 |
186 |
944,365 |
14.5% |
|
14,085,950 |
|
14.92 |
12.5% | ||||||
| 2006 |
151 |
954,998 |
14.6% |
|
17,690,395 |
|
18.52 |
15.7% | ||||||
| 2007 |
102 |
556,447 |
8.5% |
|
9,688,449 |
|
17.41 |
8.6% | ||||||
| 2008 and thereafter |
196 |
1,784,363 |
27.3% |
|
31,516,283 |
|
17.66 |
28.0% | ||||||
| 1,025 |
6,530,566 |
100.0% |
$ |
112,605,099 |
$ |
17.24 |
100.0% | |||||||
16
Washington Real Estate Investment Trust
2003 Acquisition Summary
(Dollars in thousands)
| December 31, |
||||||||||||
| Occupied |
Occupancy |
2002 |
||||||||||
| Acquisition |
Square |
Sq. Ft. at |
Percentage at |
Leased |
||||||||
| Date |
Feet |
Acquisition |
Acquisition |
Percentage |
Investment | |||||||
| Fullerton Industrial Center |
01/24/2003 |
137,000 |
100% |
100% |
100% |
$10,600,000 |
17
18
Washington Real Estate Investment Trust
Reporting Definitions
March 31, 2003
Annualized base rent (ABR) is calculated as monthly base rent (cash basis) per the lease, as of the reporting period, multiplied by 12.
Debt to total market capitalization is total debt from the balance sheet divided by the sum of total debt from the balance sheet plus the market value of shares outstanding at the end of the period.
EBITDA is earnings before interest, taxes, depreciation and amortization.
Earnings to Fixed Charges is computed by dividing income before (a) gain on sale of real estate; (b) interest expense, including amortization; and (c) capitalized interest by the sum of interest expense, capitalized interest and amortized debt costs.
Debt Service Coverage Ratio is computed by dividing income before (a) gain on sale of real estate; (b) interest income; (c) interest expense; and (d) depreciation and amortization by the sum of interest expense, including interest costs capitalized, and the amortized costs of debt issuance plus mortgage principal amortization.
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) from sales of property plus real estate depreciation and amortization. Funds Available for Distribution (FAD) is calculated by subtracting from FFO recurring expenditures, tenant improvements and leasing costs, that are capitalized and amortized and are necessary to maintain our properties and revenue stream and straight line rents, then adding non-real estate depreciation and amortization.
Recurring capital expenditures represents non-accretive building improvements and leasing costs required to maintain current revenues. Recurring capital expenditures do not include acquisition capital that was taken into consideration when underwriting the purchase of a building or which are incurred to bring a building up to "operating standard."
Rent increases on renewals and rollovers are calculated as the difference, weighted by square feet, of the net ABR due to the first month after a term commencement date and the net ABR due the last month prior to the termination date of the former tenant's term.
Core portfolio properties include all properties that were owned for the entirety of the current and prior year reporting periods.
Core portfolio net operating income (NOI) growth is the change in the NOI of the core portfolio properties from the prior reporting period to the current reporting period.
19