(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
(Address of principal executive offices) | (Zip Code) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading symbols | Name of each exchange on which registered | ||
Exhibit Number | Description | |
99.1 | Press Release Dated October 29, 2019 | |
99.2 | Third Quarter 2019 Supplemental Financial Report | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Rexford Industrial Realty, Inc. | |
October 29, 2019 | /s/ Michael S. Frankel |
Michael S. Frankel Co-Chief Executive Officer (Principal Executive Officer) | |
Rexford Industrial Realty, Inc. | |
October 29, 2019 | /s/ Howard Schwimmer |
Howard Schwimmer Co-Chief Executive Officer (Principal Executive Officer) |
Exhibit Number | Description | |
99.1 | ||
99.2 | ||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
• | Net income attributable to common stockholders of $0.09 per diluted share for the quarter ended September 30, 2019, compared to $0.07 per diluted share for the third quarter of last year. |
• | Company share of Core FFO increased 30.0% year-over-year to $33.9 million for the quarter ended September 30, 2019. |
• | Company share of Core FFO per diluted share increased 10.7% year-over-year to $0.31 per diluted share for the quarter ended September 30, 2019. |
• | Total rental income of $67.0 million, which represents an increase of 23.0% year-over-year. |
• | Consolidated Portfolio Net Operating Income (NOI) of $50.9 million, which represents an increase of 23.5% year-over-year. |
• | Consolidated Portfolio Cash NOI of $46.7 million, which represents an increase of 22.2% year-over-year. |
• | Same Property Portfolio NOI increased 5.2% compared to the third quarter of 2018, driven by a 4.8% increase in Same Property Portfolio rental income and a 3.7% increase in Same Property Portfolio operating expenses. |
• | Same Property Portfolio Cash NOI increased 6.8% compared to the third quarter of 2018. |
• | Stabilized Same Property Portfolio NOI increased 2.7% compared to the third quarter of 2018. |
• | Stabilized Same Property Portfolio Cash NOI increased 4.1% compared to the third quarter of 2018. |
• | Signed new and renewal leases totaling 1,015,097 rentable square feet. Rental rates on new and renewal leases were 31.2% higher than prior rents on a GAAP basis and 19.4% higher on a cash basis. |
• | At September 30, 2019, the Stabilized Same Property Portfolio occupancy was 97.7% and the Same Property Portfolio occupancy, inclusive of assets in value-add repositioning, was 97.0%. |
• | At September 30, 2019, the consolidated portfolio, including repositioning assets, was 95.0% leased and 94.9% occupied and the consolidated portfolio, excluding repositioning assets aggregating approximately 0.7 million rentable square feet, was 97.6% leased and 97.5% occupied. |
• | The Company ended the quarter with low leverage measured by a debt-to-enterprise value ratio of 11.2%. |
• | During the third quarter of 2019, the Company acquired nine industrial properties for an aggregate purchase price of $226.5 million. |
• | 3340 N. San Fernando Road, a one-acre paved land parcel located in the Los Angeles - San Fernando Valley submarket, for $3.0 million, or $69 per land square foot. The land parcel is part of the Company's Glendale Commerce Center industrial park and was previously operated under a ground lease. |
• | 5725 Eastgate Drive, a single-tenant industrial building containing 27,267 square feet on 3.78 acres of land, located in the Central San Diego submarket, for $8.2 million, or $299 per square foot. At closing, the Company signed a new long-term lease with a national tenant providing for immediate occupancy. |
• | 18115 S. Main Street, a 100% leased single-tenant industrial building containing 42,270 square feet on 2.74 acres of land, located in the Los Angeles - South Bay submarket, for $6.8 million, or $160 per square foot. |
• | 3150 E. Ana Street, a 100% leased single-tenant industrial building containing 105,970 square feet on 6.06 acres of land, located in the Los Angeles - South Bay submarket, for $18.8 million, or $177 per square foot. |
• | 1402 Avenida Del Oro, a 100% leased single-tenant industrial building containing 311,995 square feet on 38.6 acres of land, located in the North San Diego submarket, for $73.6 million, or $236 per square foot. |
• | 9607-9623 Imperial Highway, a 100% leased 3.68-acre trucking and container yard located in the Los Angeles - Mid-Counties submarket, for $10.5 million, or $65 per land square foot. |
• | 12200 Bellflower Boulevard, a 100% leased 5.87-acre land site containing 54,161 square feet of buildings, located in the Los Angeles - Mid-Counties submarket, for $16.3 million, or $64 per land square foot. |
• | Storm Parkway, a 91% leased industrial complex containing four single-tenant buildings and four two-tenant buildings totaling 267,503 square feet on 14.23 acres of land, located in the Los Angeles - South Bay submarket, for $66.2 million or $247 per square foot. |
• | 2328 Teller Road, a 93% leased multi-tenant industrial complex containing 126,317 square feet on 8.11 acres of land, located in the Ventura County submarket, for $23.3 million or $184 per square foot. |
• | Net income attributable to common stockholders increased to a range of $0.41 to $0.43 per diluted share |
• | Company share of Core FFO increased to a range of $1.20 to $1.22 per diluted share |
• | Year-end Same Property Portfolio occupancy within a range of 96.0% to 97.0% |
• | Year-end Stabilized Same Property Portfolio occupancy within a range of 97.0% to 97.5% |
• | Same Property Portfolio NOI growth for the year increased to a range of 5.5% to 6.5% |
• | Stabilized Same Property Portfolio NOI growth for the year within a range of 3.5% to 4.0% |
• | General and administrative expenses increased to a range of $29.5 million to $30.0 million |
2019 Estimate | |||||||
Low | High | ||||||
Net income attributable to common stockholders | $ | 0.41 | $ | 0.43 | |||
Company share of depreciation and amortization | $ | 0.90 | $ | 0.90 | |||
Company share of gains on sale of real estate | $ | (0.11 | ) | $ | (0.11 | ) | |
Company share of Core FFO | $ | 1.20 | $ | 1.22 |
14748-14750 Nelson Avenue | 301-445 Figueroa Street | |
15401 Figueroa Street | 3233 Mission Oaks Boulevard | |
1601 Alton Parkway | 7110 E. Rosecrans Avenue | |
2700-2722 Fairview Street | 9615 Norwalk Boulevard | |
28903 Avenue Paine |
September 30, 2019 | December 31, 2018 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
Land | $ | 1,728,490 | $ | 1,298,957 | |||
Buildings and improvements | 1,611,060 | 1,332,438 | |||||
Tenant improvements | 68,124 | 60,024 | |||||
Furniture, fixtures, and equipment | 141 | 149 | |||||
Construction in progress | 29,094 | 24,515 | |||||
Total real estate held for investment | 3,436,909 | 2,716,083 | |||||
Accumulated depreciation | (278,726 | ) | (228,742 | ) | |||
Investments in real estate, net | 3,158,183 | 2,487,341 | |||||
Cash and cash equivalents | 197,508 | 180,601 | |||||
Restricted cash | — | — | |||||
Rents and other receivables, net | 4,376 | 4,944 | |||||
Deferred rent receivable, net | 27,502 | 22,228 | |||||
Deferred leasing costs, net | 17,561 | 14,002 | |||||
Deferred loan costs, net | 849 | 1,312 | |||||
Acquired lease intangible assets, net | 67,110 | 55,683 | |||||
Acquired indefinite-lived intangible | 5,156 | 5,156 | |||||
Interest rate swap asset | 374 | 8,770 | |||||
Other assets | 10,778 | 6,723 | |||||
Acquisition related deposits | 8,415 | 925 | |||||
Assets associated with real estate held for sale, net | 4,582 | — | |||||
Total Assets | $ | 3,502,394 | $ | 2,787,685 | |||
LIABILITIES & EQUITY | |||||||
Liabilities | |||||||
Notes payable | $ | 857,688 | $ | 757,371 | |||
Interest rate swap liability | 10,727 | 2,351 | |||||
Accounts payable, accrued expenses and other liabilities | 34,669 | 21,074 | |||||
Dividends payable | 21,034 | 15,938 | |||||
Acquired lease intangible liabilities, net | 56,151 | 52,727 | |||||
Tenant security deposits | 27,688 | 23,262 | |||||
Prepaid rents | 7,759 | 6,539 | |||||
Liabilities associated with real estate held for sale | 135 | — | |||||
Total Liabilities | 1,015,851 | 879,262 | |||||
Equity | |||||||
Rexford Industrial Realty, Inc. stockholders’ equity | |||||||
Preferred stock, $0.01 par value, 10,050,000 shares authorized; | |||||||
5.875% series A cumulative redeemable preferred stock, 3,600,000 shares outstanding as of June 30, 2019 and December 31, 2018 ($90,000 liquidation preference) | 86,651 | 86,651 | |||||
5.875% series B cumulative redeemable preferred stock, 3,000,000 shares outstanding as of September 30, 2019 and December 31, 2018 ($75,000 liquidation preference) | 72,443 | 72,443 | |||||
5.625% series C cumulative redeemable preferred stock, 3,450,000 and zero shares outstanding as of September 30, 2019 and December 31, 2018, respectively ($86,250 liquidation preference) | 83,435 | — | |||||
Common Stock, $0.01 par value 489,950,000 shares authorized and 110,884,272 and 96,810,504 shares outstanding as of September 30, 2019 and December 31, 2018, respectively | 1,106 | 966 | |||||
Additional paid in capital | 2,306,282 | 1,798,113 | |||||
Cumulative distributions in excess of earnings | (117,711 | ) | (88,341 | ) | |||
Accumulated other comprehensive income | (10,132 | ) | 6,262 | ||||
Total stockholders’ equity | 2,422,074 | 1,876,094 | |||||
Noncontrolling interests | 64,469 | 32,329 | |||||
Total Equity | 2,486,543 | 1,908,423 | |||||
Total Liabilities and Equity | $ | 3,502,394 | $ | 2,787,685 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
REVENUES | |||||||||||||||
Rental income | 67,020 | 54,469 | 190,237 | 154,518 | |||||||||||
Management, leasing and development services | 90 | 116 | 301 | 359 | |||||||||||
Interest income | 951 | 609 | 2,276 | 609 | |||||||||||
TOTAL REVENUES | 68,061 | 55,194 | 192,814 | 155,486 | |||||||||||
OPERATING EXPENSES | |||||||||||||||
Property expenses | 16,165 | 13,294 | 45,116 | 38,029 | |||||||||||
General and administrative | 7,440 | 6,229 | 22,085 | 18,897 | |||||||||||
Depreciation and amortization | 25,496 | 20,144 | 72,014 | 59,371 | |||||||||||
TOTAL OPERATING EXPENSES | 49,101 | 39,667 | 139,215 | 116,297 | |||||||||||
OTHER EXPENSES | |||||||||||||||
Acquisition expenses | 122 | 106 | 174 | 152 | |||||||||||
Interest expense | 6,785 | 6,456 | 19,511 | 18,760 | |||||||||||
TOTAL EXPENSES | 56,008 | 46,229 | 158,900 | 135,209 | |||||||||||
Gains on sale of real estate | 895 | — | 5,705 | 11,591 | |||||||||||
NET INCOME | 12,948 | 8,965 | 39,619 | 31,868 | |||||||||||
Less: net income attributable to noncontrolling interest | (518 | ) | (141 | ) | (1,288 | ) | (588 | ) | |||||||
NET INCOME ATTRIBUTABLE TO REXFORD INDUSTRIAL REALTY, INC. | 12,430 | 8,824 | 38,331 | 31,280 | |||||||||||
Less: preferred stock dividends | (2,572 | ) | (2,423 | ) | (7,419 | ) | (7,270 | ) | |||||||
Less: earnings attributable to participating securities | (112 | ) | (94 | ) | (339 | ) | (285 | ) | |||||||
NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 9,746 | $ | 6,307 | $ | 30,573 | $ | 23,725 | |||||||
Net income attributable to common stockholders per share – basic | $ | 0.09 | $ | 0.07 | $ | 0.29 | $ | 0.28 | |||||||
Net income attributable to common stockholders per share – diluted | $ | 0.09 | $ | 0.07 | $ | 0.29 | $ | 0.28 | |||||||
Weighted-average shares of common stock outstanding – basic | 109,645 | 91,464 | 104,653 | 84,407 | |||||||||||
Weighted-average shares of common stock outstanding – diluted | 110,074 | 91,945 | 105,014 | 84,925 |
Same Property Portfolio Occupancy: | |||||||||||
September 30, 2019 | September 30, 2018 | Change (basis points) | |||||||||
Same Property Portfolio | Stabilized Same Property Portfolio(1) | Same Property Portfolio | Stabilized Same Property Portfolio(2) | Same Property Portfolio | Stabilized Same Property Portfolio | ||||||
Occupancy: | |||||||||||
Los Angeles County | 97.1% | 97.5% | 95.9% | 98.2% | 120 bps | (70) bps | |||||
Orange County | 96.3% | 98.7% | 94.9% | 97.3% | 140 bps | 140 bps | |||||
San Bernardino County | 98.0% | 98.0% | 96.5% | 96.5% | 150 bps | 150 bps | |||||
San Diego County | 95.9% | 95.9% | 97.6% | 97.6% | (170) bps | (170) bps | |||||
Ventura County | 96.2% | 98.5% | 91.6% | 97.7% | 460 bps | 80 bps | |||||
Total/Weighted Average | 97.0% | 97.7% | 95.6% | 97.6% | 140 bps | 10 bps |
(1) | Reflects the occupancy of our Same Property Portfolio as of September 30, 2019, adjusted for total space of 135,429 rentable square feet at three properties that were in various stages of repositioning or lease-up as of September 30, 2019. |
(2) | Reflects the occupancy of our Same Property Portfolio as of September 30, 2018, adjusted for space aggregating 378,040 rentable square feet at six properties that were in various stages of repositioning or lease-up as of September 30, 2018. |
Same Property Portfolio NOI and Cash NOI | |||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2019 | 2018 | $ Change | % Change | 2019 | 2018 | $ Change | % Change | ||||||||||||||||||||
Rental income | $ | 51,096 | $ | 48,733 | $ | 2,363 | 4.8% | $ | 152,190 | $ | 144,451 | $ | 7,739 | 5.4% | |||||||||||||
Property expenses | 12,328 | 11,892 | 436 | 3.7% | 36,023 | 35,476 | 547 | 1.5% | |||||||||||||||||||
Same Property Portfolio NOI | $ | 38,768 | $ | 36,841 | $ | 1,927 | 5.2% | $ | 116,167 | $ | 108,975 | $ | 7,192 | 6.6% | |||||||||||||
Straight line rental revenue adjustment | (708 | ) | (920 | ) | 212 | (23.0)% | (2,647 | ) | (4,320 | ) | 1,673 | (38.7)% | |||||||||||||||
Amortization of above/below market lease intangibles | (856 | ) | (1,095 | ) | 239 | (21.8)% | (2,855 | ) | (3,443 | ) | 588 | (17.1)% | |||||||||||||||
Same Property Portfolio Cash NOI | $ | 37,204 | $ | 34,826 | $ | 2,378 | 6.8% | $ | 110,665 | $ | 101,212 | $ | 9,453 | 9.3% |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income | $ | 12,948 | $ | 8,965 | $ | 39,619 | $ | 31,868 | |||||||
Add: | |||||||||||||||
General and administrative | 7,440 | 6,229 | 22,085 | 18,897 | |||||||||||
Depreciation and amortization | 25,496 | 20,144 | 72,014 | 59,371 | |||||||||||
Acquisition expenses | 122 | 106 | 174 | 152 | |||||||||||
Interest expense | 6,785 | 6,456 | 19,511 | 18,760 | |||||||||||
Deduct: | |||||||||||||||
Management, leasing and development services | 90 | 116 | 301 | 359 | |||||||||||
Interest income | 951 | 609 | 2,276 | 609 | |||||||||||
Gains on sale of real estate | 895 | — | 5,705 | 11,591 | |||||||||||
Net operating income (NOI) | $ | 50,855 | $ | 41,175 | $ | 145,121 | $ | 116,489 | |||||||
Non-Same Property Portfolio rental income | (15,924 | ) | (5,736 | ) | (38,047 | ) | (10,067 | ) | |||||||
Non-Same Property Portfolio property expenses | 3,837 | 1,402 | 9,093 | 2,553 | |||||||||||
Same Property Portfolio NOI | $ | 38,768 | $ | 36,841 | $ | 116,167 | $ | 108,975 | |||||||
Straight line rental revenue adjustment | (708 | ) | (920 | ) | (2,647 | ) | (4,320 | ) | |||||||
Amortization of above/below market lease intangibles | (856 | ) | (1,095 | ) | (2,855 | ) | (3,443 | ) | |||||||
Same Property Portfolio Cash NOI | $ | 37,204 | $ | 34,826 | $ | 110,665 | $ | 101,212 | |||||||
NOI (from above) | $ | 50,855 | $ | 41,175 | $ | 145,121 | $ | 116,489 | |||||||
Non-Stabilized Same Property Portfolio rental income | (19,013 | ) | (7,759 | ) | (47,052 | ) | (15,272 | ) | |||||||
Non-Stabilized Same Property Portfolio property expenses | 4,494 | 1,948 | 11,119 | 4,058 | |||||||||||
Stabilized Same Property Portfolio NOI | $ | 36,336 | $ | 35,364 | $ | 109,188 | $ | 105,275 | |||||||
Straight line rental revenue adjustment | (650 | ) | (792 | ) | (2,132 | ) | (3,908 | ) | |||||||
Amortization of above/below market lease intangibles | (862 | ) | (1,106 | ) | (2,876 | ) | (3,544 | ) | |||||||
Stabilized Same Property Portfolio Cash NOI | $ | 34,824 | $ | 33,466 | $ | 104,180 | $ | 97,823 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income | $ | 12,948 | $ | 8,965 | $ | 39,619 | $ | 31,868 | |||||||
Add: | |||||||||||||||
Depreciation and amortization | 25,496 | 20,144 | 72,014 | 59,371 | |||||||||||
Deduct: | |||||||||||||||
Gains on sale of real estate | 895 | — | 5,705 | 11,591 | |||||||||||
Funds From Operations (FFO) | $ | 37,549 | $ | 29,109 | $ | 105,928 | $ | 79,648 | |||||||
Less: preferred stock dividends | (2,572 | ) | (2,423 | ) | (7,419 | ) | (7,270 | ) | |||||||
Less: FFO attributable to noncontrolling interest(1) | (1,056 | ) | (574 | ) | (2,810 | ) | (1,693 | ) | |||||||
Less: FFO attributable to participating securities(2) | (187 | ) | (165 | ) | (545 | ) | (476 | ) | |||||||
Company share of FFO | $ | 33,734 | $ | 25,947 | $ | 95,154 | $ | 70,209 | |||||||
Company Share of FFO per common share - basic | $ | 0.31 | $ | 0.28 | $ | 0.91 | $ | 0.83 | |||||||
Company Share of FFO per common share - diluted | $ | 0.31 | $ | 0.28 | $ | 0.91 | $ | 0.83 | |||||||
FFO | $ | 37,549 | $ | 29,109 | $ | 105,928 | $ | 79,648 | |||||||
Adjust: | |||||||||||||||
Acquisition expenses | 122 | 106 | 174 | 152 | |||||||||||
Core FFO | $ | 37,671 | $ | 29,215 | $ | 106,102 | $ | 79,800 | |||||||
Less: preferred stock dividends | (2,572 | ) | (2,423 | ) | (7,419 | ) | (7,270 | ) | |||||||
Less: Core FFO attributable to noncontrolling interest(1) | (1,059 | ) | (576 | ) | (2,813 | ) | (1,696 | ) | |||||||
Less: Core FFO attributable to participating securities(2) | (187 | ) | (166 | ) | (545 | ) | (478 | ) | |||||||
Company share of Core FFO | $ | 33,853 | $ | 26,050 | $ | 95,325 | $ | 70,356 | |||||||
Company share of Core FFO per common share - basic | $ | 0.31 | $ | 0.28 | $ | 0.91 | $ | 0.83 | |||||||
Company share of Core FFO per common share - diluted | $ | 0.31 | $ | 0.28 | $ | 0.91 | $ | 0.83 | |||||||
Weighted-average shares of common stock outstanding – basic | 109,645 | 91,464 | 104,653 | 84,407 | |||||||||||
Weighted-average shares of common stock outstanding – diluted | 110,074 | 91,945 | 105,014 | 84,925 |
(1) | Noncontrolling interests relate to interests in the Company’s operating partnership, represented by common units and preferred units (Series 1 CPOP units) of partnership interests in the operating partnership that are owned by unit holders other than the Company. |
(2) | Participating securities include unvested shares of restricted stock, unvested LTIP units and unvested performance units. |
Table of Contents. | ||
Section | Page |
Corporate Data: | |
Investor Company Summary | 3 |
Financial and Portfolio Highlights and Common Stock Data | 4 |
Consolidated Financial Results: | |
Consolidated Balance Sheets | 5 |
Consolidated Statements of Operations | 6-7 |
Non-GAAP FFO, Core FFO and AFFO Reconciliations | 8-9 |
Statement of Operations Reconciliations | 10 |
Same Property Portfolio Performance | 11 |
Capitalization Summary | 12 |
Debt Summary | 13 |
Portfolio Data: | |
Portfolio Overview | 14 |
Occupancy and Leasing Trends | 15 |
Leasing Statistics | 16-17 |
Top Tenants and Lease Segmentation | 18 |
Capital Expenditure Summary | 19 |
Properties and Space Under Repositioning/Development | 20-21 |
Current Year Acquisitions and Dispositions Summary | 22-23 |
Guidance | 24 |
Net Asset Value Components | 25 |
Notes and Definitions | 26-29 |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 2 | ||
Investor Company Summary. | ||
Executive Management Team | ||
Howard Schwimmer | Co-Chief Executive Officer, Director | |
Michael S. Frankel | Co-Chief Executive Officer, Director | |
Adeel Khan | Chief Financial Officer | |
David Lanzer | General Counsel and Corporate Secretary |
Board of Directors | ||
Richard Ziman | Chairman | |
Howard Schwimmer | Co-Chief Executive Officer, Director | |
Michael S. Frankel | Co-Chief Executive Officer, Director | |
Robert L. Antin | Director | |
Steven C. Good | Director | |
Diana J. Ingram | Director | |
Tyler H. Rose | Director | |
Peter Schwab | Director |
Investor Relations Information | ||
ICR | ||
Stephen Swett | ||
www.icrinc.com | ||
212-849-3882 |
Equity Research Coverage | ||||
Bank of America Merrill Lynch | James Feldman | (646) 855-5808 | ||
Capital One | Chris Lucas | (571) 633-8151 | ||
Citigroup Investment Research | Emmanuel Korchman | (212) 816-1382 | ||
Green Street Advisors | Eric Frankel | (949) 640-8780 | ||
J.P. Morgan | Michael W. Mueller, CFA | (212) 622-6689 | ||
Jefferies LLC | Jonathan Petersen | (212) 284-1705 | ||
Stifel Nicolaus & Co. | John W. Guinee | (443) 224-1307 | ||
Wells Fargo Securities | Blaine Heck | (443) 263-6529 |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 3 | ||
Financial and Portfolio Highlights and Common Stock Data. (1) | ||
(in thousands except share and per share data and portfolio statistics) |
Three Months Ended | |||||||||||||||||||
September 30, 2019 | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | |||||||||||||||
Financial Results: | |||||||||||||||||||
Total rental income | $ | 67,020 | $ | 63,613 | $ | 59,604 | $ | 56,125 | $ | 54,469 | |||||||||
Net income | $ | 12,948 | $ | 15,954 | $ | 10,717 | $ | 15,207 | $ | 8,965 | |||||||||
Net Operating Income (NOI) | $ | 50,855 | $ | 48,474 | $ | 45,792 | $ | 42,483 | $ | 41,175 | |||||||||
Company share of Core FFO | $ | 33,853 | $ | 32,068 | $ | 29,404 | $ | 27,216 | $ | 26,050 | |||||||||
Company share of Core FFO per common share - diluted | $ | 0.31 | $ | 0.30 | $ | 0.30 | $ | 0.29 | $ | 0.28 | |||||||||
Adjusted EBITDA | $ | 49,271 | $ | 45,342 | $ | 42,164 | $ | 40,348 | $ | 38,003 | |||||||||
Dividend declared per common share | $ | 0.185 | $ | 0.185 | $ | 0.185 | $ | 0.160 | $ | 0.160 | |||||||||
Portfolio Statistics: | |||||||||||||||||||
Portfolio SF - consolidated | 24,814,281 | 23,874,494 | 22,144,631 | 21,295,443 | 20,505,157 | ||||||||||||||
Ending occupancy - consolidated portfolio | 94.9 | % | 94.2 | % | 94.6 | % | 95.4 | % | 95.1 | % | |||||||||
Stabilized occupancy - consolidated portfolio | 97.5 | % | 97.8 | % | 97.8 | % | 97.5 | % | 97.6 | % | |||||||||
Leasing spreads - GAAP | 31.2 | % | 39.4 | % | 26.2 | % | 25.1 | % | 32.2 | % | |||||||||
Leasing spreads - cash | 19.4 | % | 22.3 | % | 17.3 | % | 14.8 | % | 21.1 | % | |||||||||
Same Property Performance: | |||||||||||||||||||
Same Property Portfolio SF | 18,248,342 | 18,248,342 | 18,248,342 | 18,248,342 | 18,248,342 | ||||||||||||||
Same Property Portfolio ending occupancy | 97.0 | % | 96.8 | % | 96.8 | % | 96.0 | % | 95.6 | % | |||||||||
Same Property Portfolio NOI growth(2) | 5.2 | % | 6.9 | % | 7.7 | % | n/a | n/a | |||||||||||
Same Property Portfolio Cash NOI growth(2) | 6.8 | % | 11.2 | % | 10.1 | % | n/a | n/a | |||||||||||
Stabilized Same Property Portfolio ending occupancy | 97.7 | % | 97.9 | % | 97.9 | % | 97.3 | % | 97.6 | % | |||||||||
Stabilized Same Property Portfolio NOI growth(2) | 2.7 | % | 4.0 | % | 4.4 | % | n/a | n/a | |||||||||||
Stabilized Same Property Portfolio Cash NOI growth(2) | 4.1 | % | 8.0 | % | 7.6 | % | n/a | n/a | |||||||||||
Capitalization: | |||||||||||||||||||
Common stock price at quarter end | $ | 44.02 | $ | 40.37 | $ | 35.81 | $ | 29.47 | $ | 31.96 | |||||||||
Common shares issued and outstanding | 110,669,277 | 109,519,791 | 103,804,570 | 96,610,106 | 92,497,666 | ||||||||||||||
Total shares and units issued and outstanding at period end(3) | 113,091,134 | 111,943,020 | 106,267,799 | 99,025,917 | 94,500,770 | ||||||||||||||
Weighted average shares outstanding - diluted | 110,074,074 | 106,236,309 | 98,607,786 | 94,487,773 | 91,945,206 | ||||||||||||||
5.875% Series A & Series B Preferred Stock, 5.625% Series C Preferred Stock, and 4.43937% Redeemable Convertible Preferred Units | $ | 278,281 | $ | 192,031 | $ | 165,000 | $ | 165,000 | $ | 165,000 | |||||||||
Total equity market capitalization | $ | 5,256,553 | $ | 4,711,171 | $ | 3,970,450 | $ | 3,083,294 | $ | 3,185,245 | |||||||||
Total consolidated debt | $ | 860,999 | $ | 761,038 | $ | 761,077 | $ | 761,116 | $ | 761,154 | |||||||||
Total combined market capitalization (net debt plus equity) | $ | 5,920,044 | $ | 5,300,000 | $ | 4,454,952 | $ | 3,663,809 | $ | 3,762,495 | |||||||||
Ratios: | |||||||||||||||||||
Net debt to total combined market capitalization | 11.2 | % | 11.1 | % | 10.9 | % | 15.8 | % | 15.3 | % | |||||||||
Net debt to Adjusted EBITDA (quarterly results annualized) | 3.4x | 3.2x | 2.9x | 3.6x | 3.8x |
(1) | For definition/discussion of non-GAAP financial measures and reconciliations to their nearest GAAP equivalents, see the definitions section and reconciliation section beginning on page 26 and page 8 of this report, respectively. |
(2) | Represents the year over year percentage change in NOI and Cash NOI for the Same Property Portfolio and Stabilized Same Property Portfolio. For comparability, NOI growth and Cash NOI growth for Q1’19 and Q2’19 has been restated to remove the results of Orangethorpe (sold Q2’19) and Poinsettia Unit 301 (sold Q3’19). See page 23 for a list of dispositions completed during 2019. |
(3) | Includes the following number of OP Units and vested LTIP units held by noncontrolling interests: 2,421,857 (Sep 30, 2019), 2,423,229 (Jun 30, 2019), 2,463,229 (Mar 31, 2019), 2,415,811 (Dec 31, 2018) and 2,003,104 (Sep 30, 2018). Excludes the following number of shares of unvested restricted stock: 214,995 (Sep 30, 2019), 219,789 (Jun 30, 2019), 223,476 (Mar 31, 2019), 200,398 (Dec 31, 2018) and 209,214 (Sep 30, 2018). Excludes unvested LTIP units and unvested performance units. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 4 | ||
Consolidated Balance Sheets. | ||
(unaudited and in thousands) |
September 30, 2019 | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | |||||||||||||||
ASSETS | |||||||||||||||||||
Land | $ | 1,728,490 | $ | 1,590,321 | $ | 1,364,738 | $ | 1,298,957 | $ | 1,218,386 | |||||||||
Buildings and improvements | 1,611,060 | 1,528,750 | 1,422,684 | 1,332,438 | 1,253,935 | ||||||||||||||
Tenant improvements | 68,124 | 66,665 | 62,908 | 60,024 | 54,808 | ||||||||||||||
Furniture, fixtures, and equipment | 141 | 141 | 149 | 149 | 151 | ||||||||||||||
Construction in progress | 29,094 | 23,576 | 20,331 | 24,515 | 50,367 | ||||||||||||||
Total real estate held for investment | 3,436,909 | 3,209,453 | 2,870,810 | 2,716,083 | 2,577,647 | ||||||||||||||
Accumulated depreciation | (278,726 | ) | (261,231 | ) | (245,033 | ) | (228,742 | ) | (214,680 | ) | |||||||||
Investments in real estate, net | 3,158,183 | 2,948,222 | 2,625,777 | 2,487,341 | 2,362,967 | ||||||||||||||
Cash and cash equivalents | 197,508 | 172,209 | 276,575 | 180,601 | 183,904 | ||||||||||||||
Restricted cash | — | 11,055 | — | — | — | ||||||||||||||
Rents and other receivables, net | 4,376 | 3,614 | 4,548 | 4,944 | 5,042 | ||||||||||||||
Deferred rent receivable, net | 27,502 | 25,462 | 24,290 | 22,228 | 20,770 | ||||||||||||||
Deferred leasing costs, net | 17,561 | 16,722 | 14,139 | 14,002 | 13,446 | ||||||||||||||
Deferred loan costs, net | 849 | 1,004 | 1,158 | 1,312 | 1,467 | ||||||||||||||
Acquired lease intangible assets, net(1) | 67,110 | 61,664 | 56,122 | 55,683 | 53,402 | ||||||||||||||
Acquired indefinite-lived intangible | 5,156 | 5,156 | 5,156 | 5,156 | 5,156 | ||||||||||||||
Interest rate swap asset | 374 | 1,414 | 5,896 | 8,770 | 13,851 | ||||||||||||||
Other assets(2) | 10,778 | 14,204 | 12,580 | 6,723 | 7,508 | ||||||||||||||
Acquisition related deposits | 8,415 | 4,615 | 10,875 | 925 | 1,325 | ||||||||||||||
Assets associated with real estate held for sale, net(3) | 4,582 | — | — | — | — | ||||||||||||||
Total Assets | $ | 3,502,394 | $ | 3,265,341 | $ | 3,037,116 | $ | 2,787,685 | $ | 2,668,838 | |||||||||
LIABILITIES & EQUITY | |||||||||||||||||||
Liabilities | |||||||||||||||||||
Notes payable | $ | 857,688 | $ | 757,677 | $ | 757,524 | $ | 757,371 | $ | 757,218 | |||||||||
Interest rate swap liability | 10,727 | 8,671 | 4,604 | 2,351 | — | ||||||||||||||
Accounts payable, accrued expenses and other liabilities(2) | 34,669 | 26,065 | 33,728 | 21,074 | 30,411 | ||||||||||||||
Dividends payable | 21,034 | 20,823 | 19,774 | 15,938 | 15,214 | ||||||||||||||
Acquired lease intangible liabilities, net(4) | 56,151 | 55,084 | 52,426 | 52,727 | 52,289 | ||||||||||||||
Tenant security deposits | 27,688 | 26,123 | 24,396 | 23,262 | 21,888 | ||||||||||||||
Prepaid rents | 7,759 | 6,289 | 6,828 | 6,539 | 6,424 | ||||||||||||||
Liabilities associated with real estate held for sale(3) | 135 | — | — | — | — | ||||||||||||||
Total Liabilities | 1,015,851 | 900,732 | 899,280 | 879,262 | 883,444 | ||||||||||||||
Equity | |||||||||||||||||||
Preferred stock | 242,529 | 159,094 | 159,094 | 159,094 | 159,094 | ||||||||||||||
Common stock | 1,106 | 1,095 | 1,038 | 966 | 924 | ||||||||||||||
Additional paid in capital | 2,306,282 | 2,255,849 | 2,042,218 | 1,798,113 | 1,666,339 | ||||||||||||||
Cumulative distributions in excess of earnings | (117,711 | ) | (107,056 | ) | (99,715 | ) | (88,341 | ) | (85,358 | ) | |||||||||
Accumulated other comprehensive income | (10,132 | ) | (7,101 | ) | 1,261 | 6,262 | 13,558 | ||||||||||||
Total stockholders’ equity | 2,422,074 | 2,301,881 | 2,103,896 | 1,876,094 | 1,754,557 | ||||||||||||||
Noncontrolling interests | 64,469 | 62,728 | 33,940 | 32,329 | 30,837 | ||||||||||||||
Total Equity | 2,486,543 | 2,364,609 | 2,137,836 | 1,908,423 | 1,785,394 | ||||||||||||||
Total Liabilities and Equity | $ | 3,502,394 | $ | 3,265,341 | $ | 3,037,116 | $ | 2,787,685 | $ | 2,668,838 |
(1) | Includes net above-market tenant lease intangibles of $5,517 (September 30, 2019), $5,450 (June 30, 2019), $5,410 (March 31, 2019), $4,647 (December 31, 2018) and $4,453 (September 30, 2018). |
(2) | In connection with the adoption of Financial Accounting Standards Board Topic 842 - Leases on January 1, 2019, we recognized operating lease right-of-use assets and lease liabilities related to our ground and office leases. As of September 30, 2019 we have operating lease right-of-use assets and lease liabilities of of $3.7 million and $3.9 million, respectively. |
(3) | As of September 30, 2019, our property located at 13914-13932 East Valley Boulevard was classified as held for sale. |
(4) | Includes net below-market tenant lease intangibles of $56,151 (September 30, 2019), $55,084 (June 30, 2019), $52,426 (March 31, 2019), $52,610 (December 31, 2018) and $52,164 (September 30, 2018). |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 5 | ||
Consolidated Statements of Operations. | ||
Quarterly Results | (unaudited and in thousands, except share and per share data) |
Three Months Ended | |||||||||||||||||||
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | |||||||||||||||
Revenues | |||||||||||||||||||
Rental income(1) | $ | 67,020 | $ | 63,613 | $ | 59,604 | $ | 56,125 | $ | 54,469 | |||||||||
Management, leasing, and development services | 90 | 109 | 102 | 114 | 116 | ||||||||||||||
Interest income | 951 | 668 | 657 | 769 | 609 | ||||||||||||||
Total Revenues | 68,061 | 64,390 | 60,363 | 57,008 | 55,194 | ||||||||||||||
Operating Expenses | |||||||||||||||||||
Property expenses | 16,165 | 15,139 | 13,812 | 13,642 | 13,294 | ||||||||||||||
General and administrative(2) | 7,440 | 7,301 | 7,344 | 6,297 | 6,229 | ||||||||||||||
Depreciation and amortization | 25,496 | 24,522 | 21,996 | 20,671 | 20,144 | ||||||||||||||
Total Operating Expenses | 49,101 | 46,962 | 43,152 | 40,610 | 39,667 | ||||||||||||||
Other Expenses | |||||||||||||||||||
Acquisition expenses | 122 | 29 | 23 | 166 | 106 | ||||||||||||||
Interest expense | 6,785 | 6,255 | 6,471 | 6,656 | 6,456 | ||||||||||||||
Total Expenses | 56,008 | 53,246 | 49,646 | 47,432 | 46,229 | ||||||||||||||
Gains on sale of real estate | 895 | 4,810 | — | 5,631 | — | ||||||||||||||
Net Income | 12,948 | 15,954 | 10,717 | 15,207 | 8,965 | ||||||||||||||
Less: net income attributable to noncontrolling interests | (518 | ) | (569 | ) | (201 | ) | (277 | ) | (141 | ) | |||||||||
Net income attributable to Rexford Industrial Realty, Inc. | 12,430 | 15,385 | 10,516 | 14,930 | 8,824 | ||||||||||||||
Less: preferred stock dividends | (2,572 | ) | (2,424 | ) | (2,423 | ) | (2,424 | ) | (2,423 | ) | |||||||||
Less: earnings allocated to participating securities | (112 | ) | (113 | ) | (114 | ) | (93 | ) | (94 | ) | |||||||||
Net income attributable to common stockholders | $ | 9,746 | $ | 12,848 | $ | 7,979 | $ | 12,413 | $ | 6,307 | |||||||||
Earnings per Common Share | |||||||||||||||||||
Net income attributable to common stockholders per share - basic | $ | 0.09 | $ | 0.12 | $ | 0.08 | $ | 0.13 | $ | 0.07 | |||||||||
Net income attributable to common stockholders per share - diluted | $ | 0.09 | $ | 0.12 | $ | 0.08 | $ | 0.13 | $ | 0.07 | |||||||||
Weighted average shares outstanding - basic | 109,645,216 | 105,847,557 | 98,342,677 | 93,995,846 | 91,463,594 | ||||||||||||||
Weighted average shares outstanding - diluted | 110,074,074 | 106,236,309 | 98,607,786 | 94,487,773 | 91,945,206 |
(1) | See footnote (1) on the next page (page 7) for details related to our presentation of “Rental income” in the consolidated statements of operations for all periods presented. |
(2) | In connection with the adoption of Financial Accounting Standards Board Topic 842, Leases (“ASC 842”), beginning in 2019 we are required to expense internal leasing costs that were previously allowed to be capitalized under prior lease accounting guidance (“ASC 840”). If we had adopted ASC 842 as of January 1, 2018, we would have expensed internal leasing costs (in thousands) of $288 and $288 for the three months ended December 31, 2018 and September 30, 2018, respectively. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 6 | ||
Consolidated Statements of Operations. | ||
Quarterly Results | (unaudited and in thousands) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues | |||||||||||||||
Rental income(1) | $ | 67,020 | $ | 54,469 | $ | 190,237 | $ | 154,518 | |||||||
Management, leasing, and development services | 90 | 116 | 301 | 359 | |||||||||||
Interest income | 951 | 609 | 2,276 | 609 | |||||||||||
Total Revenues | 68,061 | 55,194 | 192,814 | 155,486 | |||||||||||
Operating Expenses | |||||||||||||||
Property expenses | 16,165 | 13,294 | 45,116 | 38,029 | |||||||||||
General and administrative (2) | 7,440 | 6,229 | 22,085 | 18,897 | |||||||||||
Depreciation and amortization | 25,496 | 20,144 | 72,014 | 59,371 | |||||||||||
Total Operating Expenses | 49,101 | 39,667 | 139,215 | 116,297 | |||||||||||
Other Expenses | |||||||||||||||
Acquisition expenses | 122 | 106 | 174 | 152 | |||||||||||
Interest expense | 6,785 | 6,456 | 19,511 | 18,760 | |||||||||||
Total Expenses | 56,008 | 46,229 | 158,900 | 135,209 | |||||||||||
Gains on sale of real estate | 895 | — | 5,705 | 11,591 | |||||||||||
Net Income | 12,948 | 8,965 | 39,619 | 31,868 | |||||||||||
Less: net income attributable to noncontrolling interests | (518 | ) | (141 | ) | (1,288 | ) | (588 | ) | |||||||
Net income attributable to Rexford Industrial Realty, Inc. | 12,430 | 8,824 | 38,331 | 31,280 | |||||||||||
Less: preferred stock dividends | (2,572 | ) | (2,423 | ) | (7,419 | ) | (7,270 | ) | |||||||
Less: earnings allocated to participating securities | (112 | ) | (94 | ) | (339 | ) | (285 | ) | |||||||
Net income attributable to common stockholders | $ | 9,746 | $ | 6,307 | $ | 30,573 | $ | 23,725 |
(1) | On January 1, 2019, we adopted ASC 842 and, among other practical expedients, elected the “non-separation practical expedient” in ASC 842, which allows us to avoid separating lease and non-lease rental income. As a result of this election, all rental income earned pursuant to tenant leases, including tenant reimbursements, in 2019 is reflected as one line, “Rental income,” in the 2019 consolidated statements of operations. Prior to the adoption of ASC 842, we presented rental revenues, tenant reimbursements and other income related to leases separately in our consolidated statements of operations. To facilitate comparability, we have reclassified 2018 amounts to conform with 2019 presentation. Under the section “Rental Income” on page 28 in the definitions section of this report, we include a presentation of rental revenues, tenant reimbursements and other income for all periods because we believe this information is frequently used by management, investors, securities analysts and other interested parties to evaluate our performance. |
(2) | In connection with the adoption of ASC 842, beginning in 2019 we are required to expense internal leasing costs that were previously allowed to be capitalized under ASC 840. If we had adopted ASC 842 as of January 1, 2018, we would have expensed internal leasing costs of $288 thousand and $704 thousand during the three and nine months ended September 30, 2018, respectively. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 7 | ||
Non-GAAP FFO and Core FFO Reconciliations. (1) | ||
(unaudited and in thousands, except share and per share data) |
Three Months Ended | |||||||||||||||||||
September 30, 2019 | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | |||||||||||||||
Net Income | $ | 12,948 | $ | 15,954 | $ | 10,717 | $ | 15,207 | $ | 8,965 | |||||||||
Add: | |||||||||||||||||||
Depreciation and amortization | 25,496 | 24,522 | 21,996 | 20,671 | 20,144 | ||||||||||||||
Deduct: | |||||||||||||||||||
Gains on sale of real estate | 895 | 4,810 | — | 5,631 | — | ||||||||||||||
Funds From Operations (FFO) | 37,549 | 35,666 | 32,713 | 30,247 | 29,109 | ||||||||||||||
Less: preferred stock dividends | (2,572 | ) | (2,424 | ) | (2,423 | ) | (2,424 | ) | (2,423 | ) | |||||||||
Less: FFO attributable to noncontrolling interests(2) | (1,056 | ) | (1,021 | ) | (733 | ) | (602 | ) | (574 | ) | |||||||||
Less: FFO attributable to participating securities(3) | (187 | ) | (182 | ) | (176 | ) | (166 | ) | (165 | ) | |||||||||
Company share of FFO | $ | 33,734 | $ | 32,039 | $ | 29,381 | $ | 27,055 | $ | 25,947 | |||||||||
Company share of FFO per common share‐basic | $ | 0.31 | $ | 0.30 | $ | 0.30 | $ | 0.29 | $ | 0.28 | |||||||||
Company share of FFO per common share‐diluted | $ | 0.31 | $ | 0.30 | $ | 0.30 | $ | 0.29 | $ | 0.28 | |||||||||
FFO | $ | 37,549 | $ | 35,666 | $ | 32,713 | $ | 30,247 | $ | 29,109 | |||||||||
Add: | |||||||||||||||||||
Acquisition expenses | 122 | 29 | 23 | 166 | 106 | ||||||||||||||
Core FFO | 37,671 | 35,695 | 32,736 | 30,413 | 29,215 | ||||||||||||||
Less: preferred stock dividends | (2,572 | ) | (2,424 | ) | (2,423 | ) | (2,424 | ) | (2,423 | ) | |||||||||
Less: Core FFO attributable to noncontrolling interests(2) | (1,059 | ) | (1,021 | ) | (733 | ) | (606 | ) | (576 | ) | |||||||||
Less: Core FFO attributable to participating securities(3) | (187 | ) | (182 | ) | (176 | ) | (167 | ) | (166 | ) | |||||||||
Company share of Core FFO | $ | 33,853 | $ | 32,068 | $ | 29,404 | $ | 27,216 | $ | 26,050 | |||||||||
Company share of Core FFO per common share‐basic | $ | 0.31 | $ | 0.30 | $ | 0.30 | $ | 0.29 | $ | 0.28 | |||||||||
Company share of Core FFO per common share‐diluted | $ | 0.31 | $ | 0.30 | $ | 0.30 | $ | 0.29 | $ | 0.28 | |||||||||
Weighted-average shares outstanding-basic | 109,645,216 | 105,847,557 | 98,342,677 | 93,995,846 | 91,463,594 | ||||||||||||||
Weighted-average shares outstanding-diluted(4) | 110,074,074 | 106,236,309 | 98,607,786 | 94,487,773 | 91,945,206 |
(1) | For a definition and discussion of non-GAAP financial measures, see the definitions section beginning on page 26 of this report. |
(2) | Noncontrolling interests relate to interests in the Company’s operating partnership, represented by common units and preferred units (Series 1 CPOP units) of partnership interests in the operating partnership that are owned by unit holders other than the Company. |
(3) | Participating securities include unvested shares of restricted stock, unvested LTIP units and unvested performance units. |
(4) | Weighted-average shares outstanding-diluted includes adjustments for unvested performance units if the effect is dilutive for the reported period. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 8 | ||
Non-GAAP AFFO Reconciliation. (1) | ||
(unaudited and in thousands, except share and per share data) |
Three Months Ended | |||||||||||||||||||
September 30, 2019 | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | |||||||||||||||
Funds From Operations(2) | $ | 37,549 | $ | 35,666 | $ | 32,713 | $ | 30,247 | $ | 29,109 | |||||||||
Add: | |||||||||||||||||||
Amortization of deferred financing costs | 347 | 345 | 344 | 345 | 344 | ||||||||||||||
Non-cash stock compensation | 2,668 | 2,709 | 2,579 | 2,282 | 2,244 | ||||||||||||||
Straight line corporate office rent expense adjustment | — | — | — | (47 | ) | (43 | ) | ||||||||||||
Deduct: | |||||||||||||||||||
Preferred stock dividends | 2,572 | 2,424 | 2,423 | 2,424 | 2,423 | ||||||||||||||
Straight line rental revenue adjustment(3) | 2,080 | 1,241 | 2,067 | 1,492 | 1,343 | ||||||||||||||
Amortization of net below-market lease intangibles | 2,065 | 1,900 | 1,751 | 1,627 | 1,622 | ||||||||||||||
Capitalized payments(4) | 2,375 | 2,008 | 1,495 | 1,573 | 1,677 | ||||||||||||||
Note payable premium amortization | (1 | ) | (2 | ) | (1 | ) | (1 | ) | (1 | ) | |||||||||
Recurring capital expenditures(5) | 1,851 | 1,280 | 2,294 | 2,403 | 1,405 | ||||||||||||||
2nd generation tenant improvements and leasing commissions(6) | 1,211 | 1,358 | 1,209 | 1,252 | 966 | ||||||||||||||
Adjusted Funds From Operations (AFFO) | $ | 28,411 | $ | 28,511 | $ | 24,398 | $ | 22,057 | $ | 22,219 |
(1) | For a definition and discussion of non-GAAP financial measures, see the definitions section beginning on page 26 of this report. |
(2) | A reconciliation of net income to Funds From Operations is set forth on page 8 of this report. |
(3) | The straight line rental revenue adjustment includes concessions of $1,057, $916, $1,399, $1,039 and $914 for the three months ended September 30, 2019, June 30, 2019, March 31, 2019, December 31, 2018, and September 30, 2018, respectively. |
(4) | Includes capitalized interest, taxes, insurance and leasing and construction development compensation. |
(5) | Excludes nonrecurring capital expenditures of $8,816, $6,672, $7,779, $10,529 and $14,211 for the three months ended September 30, 2019, June 30, 2019, March 31, 2019, December 31, 2018, and September 30, 2018, respectively. |
(6) | Excludes 1st generation tenant improvements/space preparation and leasing commissions of $1,164, $2,791, $282, $1,014 and $805 for the three months ended September 30, 2019, June 30, 2019, March 31, 2019, December 31, 2018, and September 30, 2018, respectively. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 9 | ||
Statement of Operations Reconciliations - NOI, Cash NOI, EBITDAre and Adjusted EBITDA. (1) | ||
(unaudited and in thousands) |
NOI and Cash NOI | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | |||||||||||||||
Rental income(2) | $ | 67,020 | $ | 63,613 | $ | 59,604 | $ | 56,125 | $ | 54,469 | |||||||||
Property expenses | 16,165 | 15,139 | 13,812 | 13,642 | 13,294 | ||||||||||||||
Net Operating Income (NOI) | $ | 50,855 | $ | 48,474 | $ | 45,792 | $ | 42,483 | $ | 41,175 | |||||||||
Amortization of above/below market lease intangibles | (2,065 | ) | (1,900 | ) | (1,751 | ) | (1,627 | ) | (1,622 | ) | |||||||||
Straight line rental revenue adjustment | (2,080 | ) | (1,241 | ) | (2,067 | ) | (1,492 | ) | (1,343 | ) | |||||||||
Cash NOI | $ | 46,710 | $ | 45,333 | $ | 41,974 | $ | 39,364 | $ | 38,210 |
EBITDAre and Adjusted EBITDA | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | |||||||||||||||
Net income | $ | 12,948 | $ | 15,954 | $ | 10,717 | $ | 15,207 | $ | 8,965 | |||||||||
Interest expense | 6,785 | 6,255 | 6,471 | 6,656 | 6,456 | ||||||||||||||
Depreciation and amortization | 25,496 | 24,522 | 21,996 | 20,671 | 20,144 | ||||||||||||||
Gains on sale of real estate | (895 | ) | (4,810 | ) | — | (5,631 | ) | — | |||||||||||
EBITDAre | $ | 44,334 | $ | 41,921 | $ | 39,184 | $ | 36,903 | $ | 35,565 | |||||||||
Stock-based compensation amortization | 2,668 | 2,709 | 2,579 | 2,282 | 2,244 | ||||||||||||||
Acquisition expenses | 122 | 29 | 23 | 166 | 106 | ||||||||||||||
Pro forma effect of acquisitions(3) | 2,142 | 822 | 378 | 1,005 | 88 | ||||||||||||||
Pro forma effect of dispositions(4) | 5 | (139 | ) | — | (8 | ) | — | ||||||||||||
Adjusted EBITDA | $ | 49,271 | $ | 45,342 | $ | 42,164 | $ | 40,348 | $ | 38,003 |
(1) | For a definition and discussion of non-GAAP financial measures, see the definitions section beginning on page 26 of this report. |
(2) | See footnote (1) on page 7 for details related to our presentation of “Rental income” in the consolidated statements of operations for all periods presented. |
(3) | Represents the estimated impact on Q3'19 EBITDAre of Q3'19 acquisitions as if they had been acquired on July 1, 2019, the impact on Q2'19 EBITDAre of Q2'19 acquisitions as if they had been acquired on April 1, 2019, the impact on Q1'19 EBITDAre of Q1'19 acquisitions as if they had been acquired on January 1, 2019, the impact on Q4'18 EBITDAre of Q4'18 acquisitions as if they had been acquired on October 1, 2018, and the impact on Q3'18 EBITDAre of Q3'18 acquisitions as if they had been acquired on July 1, 2018. We have made a number of assumptions in such estimates and there can be no assurance that we would have generated the projected levels of EBITDAre had we owned the acquired entities as of the beginning of each period. |
(4) | Represents the impact on Q3'19 EBITDAre of Q3'19 dispositions as if they had been sold as of July 1, 2019, Q2'19 EBITDAre of Q2'19 dispositions as if they had been sold as of April 1, 2019 and the impact on Q4'18 EBITDAre of Q4'18 dispositions as if they had been sold as of October 1, 2018. See page 23 for details related to current year disposition properties. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 10 | ||
Same Property Portfolio Performance. (1) | ||
(unaudited and dollars in thousands) |
Same Property Portfolio: | ||||||||||||||||
Number of properties | 146 | |||||||||||||||
Square Feet | 18,248,342 |
Same Property Portfolio NOI and Cash NOI: | ||||||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||
2019 | 2018 | $ Change | % Change | 2019 | 2018 | $ Change | % Change | |||||||||||||||||||||
Rental income(2)(3) | $ | 51,096 | $ | 48,733 | $ | 2,363 | 4.8% | $ | 152,190 | $ | 144,451 | $ | 7,739 | 5.4% | ||||||||||||||
Property expenses | 12,328 | 11,892 | 436 | 3.7% | 36,023 | 35,476 | 547 | 1.5% | ||||||||||||||||||||
Same property portfolio NOI | $ | 38,768 | $ | 36,841 | $ | 1,927 | 5.2% | (3) | $ | 116,167 | $ | 108,975 | $ | 7,192 | 6.6% | (3) | ||||||||||||
Straight-line rents | (708 | ) | (920 | ) | 212 | (23.0)% | (2,647 | ) | (4,320 | ) | 1,673 | (38.7)% | ||||||||||||||||
Amort. above/below market leases | (856 | ) | (1,095 | ) | 239 | (21.8)% | (2,855 | ) | (3,443 | ) | 588 | (17.1)% | ||||||||||||||||
Same property portfolio Cash NOI | $ | 37,204 | $ | 34,826 | $ | 2,378 | 6.8% | (3) | $ | 110,665 | $ | 101,212 | $ | 9,453 | 9.3% | (3) | ||||||||||||
Stabilized same property portfolio NOI(4) | $ | 36,336 | $ | 35,364 | $ | 972 | 2.7% | $ | 109,188 | $ | 105,275 | $ | 3,913 | 3.7% | ||||||||||||||
Stabilized same property portfolio Cash NOI(4) | $ | 34,824 | $ | 33,466 | $ | 1,358 | 4.1% | $ | 104,180 | $ | 97,823 | $ | 6,357 | 6.5% |
Same Property Portfolio Occupancy: | |||||||||||
September 30, 2019 | September 30, 2018 | Change (basis points) | |||||||||
Same Property Portfolio | Stabilized Same Property Portfolio(5) | Same Property Portfolio | Stabilized Same Property Portfolio(6) | Same Property Portfolio | Stabilized Same Property Portfolio | ||||||
Occupancy: | |||||||||||
Los Angeles County | 97.1% | 97.5% | 95.9% | 98.2% | 120 bps | (70) bps | |||||
Orange County | 96.3% | 98.7% | 94.9% | 97.3% | 140 bps | 140 bps | |||||
San Bernardino County | 98.0% | 98.0% | 96.5% | 96.5% | 150 bps | 150 bps | |||||
Ventura County | 96.2% | 98.5% | 91.6% | 97.7% | 460 bps | 80 bps | |||||
San Diego County | 95.9% | 95.9% | 97.6% | 97.6% | (170) bps | (170) bps | |||||
Total/Weighted Average | 97.0% | 97.7% | 95.6% | 97.6% | 140 bps | 10 bps |
(1) | For a definition and discussion of non-GAAP financial measures, see the definitions section beginning on page 26 of this report. |
(2) | See “Same Property Portfolio Rental Income” on page 28 of the definitions section of this report for a breakdown of rental income into rental revenues, tenant reimb. and other income for 2018 & 2019. |
(3) | Rental income includes lease termination fees of zero and $49 thousand for the three months ended September 30, 2019 and 2018, respectively, and $2 thousand and $172 thousand for the nine months ended September 30, 2019 and 2018, respectively. Excluding these lease termination fees, Same Property Portfolio NOI increased by approximately 5.4% and 6.8% and Same Property Portfolio Cash NOI increased by approximately 7.0% and 9.5% during the three and nine months ended September 30, 2019, compared to the three and nine months ended September 30, 2018, respectively. |
(4) | Excludes the operating results of properties under repositioning or lease-up in 2018 and 2019 (see page 29 for a list of these properties). |
(5) | Reflects the occupancy of our Same Property Portfolio as of Sep 30, 2019, adjusted for space totaling 135,429 RSF at three properties that were classified as repositioning or lease-up as of Sep 30, 2019. For additional details, refer to pages 20-21 of this report. |
(6) | Reflects the occupancy of our Same Portfolio Property as of Sep 30, 2018, adjusted for space totaling 378,040 RSF at six properties that were classified as repositioning or lease-up as of Sep 30, 2018. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 11 | ||
Capitalization Summary. | ||
(unaudited and in thousands, except share and per share data) | ||
Capitalization as of September 30, 2019 |
Description | September 30, 2019 | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | |||||||||||||||
Common shares outstanding(1) | 110,669,277 | 109,519,791 | 103,804,570 | 96,610,106 | 92,497,666 | |||||||||||||||
Operating partnership units outstanding(2) | 2,421,857 | 2,423,229 | 2,463,229 | 2,415,811 | 2,003,104 | |||||||||||||||
Total shares and units outstanding at period end | 113,091,134 | 111,943,020 | 106,267,799 | 99,025,917 | 94,500,770 | |||||||||||||||
Share price at end of quarter | $ | 44.02 | $ | 40.37 | $ | 35.81 | $ | 29.47 | $ | 31.96 | ||||||||||
Common Stock and Operating Partnership Units - Capitalization | $ | 4,978,272 | $ | 4,519,140 | $ | 3,805,450 | $ | 2,918,294 | $ | 3,020,245 | ||||||||||
5.875% Series A Cumulative Redeemable Preferred Stock(3) | 90,000 | 90,000 | 90,000 | 90,000 | 90,000 | |||||||||||||||
5.875% Series B Cumulative Redeemable Preferred Stock(3) | 75,000 | 75,000 | 75,000 | 75,000 | 75,000 | |||||||||||||||
5.625% Series C Cumulative Redeemable Preferred Stock(3) | 86,250 | — | — | — | — | |||||||||||||||
4.43937% Cumulative Redeemable Convertible Preferred Units(4) | 27,031 | 27,031 | — | — | — | |||||||||||||||
Total Equity Market Capitalization | $ | 5,256,553 | $ | 4,711,171 | $ | 3,970,450 | $ | 3,083,294 | $ | 3,185,245 | ||||||||||
Total Debt | $ | 860,999 | $ | 761,038 | $ | 761,077 | $ | 761,116 | $ | 761,154 | ||||||||||
Less: Cash and cash equivalents | (197,508 | ) | (172,209 | ) | (276,575 | ) | (180,601 | ) | (183,904 | ) | ||||||||||
Net Debt | $ | 663,491 | $ | 588,829 | $ | 484,502 | $ | 580,515 | $ | 577,250 | ||||||||||
Total Combined Market Capitalization (Net Debt plus Equity) | $ | 5,920,044 | $ | 5,300,000 | $ | 4,454,952 | $ | 3,663,809 | $ | 3,762,495 | ||||||||||
Net debt to total combined market capitalization | 11.2 | % | 11.1 | % | 10.9 | % | 15.8 | % | 15.3 | % | ||||||||||
Net debt to Adjusted EBITDA (quarterly results annualized)(5) | 3.4x | 3.2x | 2.9x | 3.6x | 3.8x |
(1) | Excludes the following number of shares of unvested restricted stock: 214,995 (Sep 30, 2019), 219,789 (Jun 30, 2019), 223,476 (Mar 31, 2019), 200,398 (Dec 31, 2018) and 209,214 (Sep 30, 2018). |
(2) | Represents outstanding common units of the Company’s operating partnership, Rexford Industrial Realty, LP, that are owned by unitholders other than Rexford Industrial Realty, Inc. Represents the noncontrolling interest in our operating partnership. As of Sep 30, 2019, includes 276,674 vested LTIP Units & 263,236 vested performance units & excludes 334,178 unvested LTIP Units & 591,767 unvested performance units. |
(3) | Values based on liquidation preference of $25.00 per share and the following number of outstanding shares of preferred stock: Series A (3,600,000); Series B (3,000,000); Series C (3,450,000). |
(4) | Value based on 593,960 outstanding preferred units (Series 1 CPOP Units) at a liquidation preference of $45.50952 per unit. |
(5) | For a definition and discussion of non-GAAP financial measures, see the definitions section beginning on page 26 of this report. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 12 | ||
Debt Summary. | (unaudited and dollars in thousands) | |
Debt Detail: | ||
As of September 30, 2019 |
Debt Description | Maturity Date | Stated Interest Rate | Effective Interest Rate(1) | Principal Balance(2) | Expiration Date of Effective Swaps | |||||||
Secured Debt: | ||||||||||||
$60M Term Loan | 8/1/2023(3) | LIBOR+1.70% | 3.716% | $ | 58,499 | |||||||
Gilbert/La Palma | 3/1/2031 | 5.125% | 5.125% | 2,500 | ||||||||
Unsecured Debt: | ||||||||||||
$350M Revolving Credit Facility(4) | 2/12/2021(5) | LIBOR +1.10%(6) | 3.116% | — | ||||||||
$100M Term Loan Facility | 2/14/2022 | LIBOR +1.20%(6) | 2.964% | 100,000 | 8/14/2021 | |||||||
$225M Term Loan Facility | 1/14/2023 | LIBOR +1.20%(6) | 2.574% | 225,000 | 1/14/2022 | |||||||
$150M Term Loan Facility | 5/22/2025 | LIBOR +1.50%(6) | 4.263% | 150,000 | 11/22/2024 | |||||||
$100M Senior Notes | 8/6/2025 | 4.29% | 4.290% | 100,000 | ||||||||
$125M Senior Notes | 7/13/2027 | 3.93% | 3.930% | 125,000 | ||||||||
$25M Series 2019A Senior Notes | 7/16/2029 | 3.88% | 3.880% | 25,000 | ||||||||
$75M Series 2019B Senior Notes | 7/16/2034 | 4.03% | 4.030% | 75,000 | ||||||||
3.559% | $ | 860,999 |
(1) | Includes the effect of interest rate swaps effective as of September 30, 2019, and excludes the effect of discounts, deferred loan costs and the credit facility fee. |
(2) | Excludes unamortized debt issuance costs and discounts aggregating $3.3 million as of September 30, 2019. |
(3) | One two-year extension is available, provided that certain conditions are satisfied. |
(4) | The credit facility is subject to a facility fee which is calculated as a percentage of the total commitment amount, regardless of usage. The facility fee ranges from 0.15% to 0.30% depending on the ratio of our outstanding indebtedness to the value of our gross asset value, which is measured on a quarterly basis. |
(5) | Two additional six-month extensions are available, provided that certain conditions are satisfied. |
(6) | The applicable LIBOR margin ranges from 1.10% to 1.50% for the revolving credit facility, 1.20% to 1.70% for the $100M term loan facility, 1.20% to 1.70% for the $225M term loan facility and 1.50% to 2.20% for the $150M term loan facility depending on the ratio of our outstanding debt to the value of our gross asset value (measured quarterly). As a result, the effective interest rate will fluctuate from period to period. |
Debt Composition: | ||||||||||||
Category | Weighted Average Term Remaining (yrs)(1) | Stated Interest Rate | Effective Interest Rate | Balance | % of Total | |||||||
Fixed | 5.9 | 3.55% | 3.55% | $ | 802,500 | 93% | ||||||
Variable | 3.8 | LIBOR + 1.70% | 3.72% | $ | 58,499 | 7% | ||||||
Secured | 4.1 | 3.77% | $ | 60,999 | 7% | |||||||
Unsecured | 5.9 | 3.54% | $ | 800,000 | 93% |
(1) | The weighted average remaining term to maturity of our consolidated debt is 5.8 years. |
Debt Maturity Schedule: | ||||||||||||||||||
Year | Secured(1) | Unsecured | Total | % Total | Effective Interest Rate | |||||||||||||
2019 - 2021 | $ | — | $ | — | $ | — | — | % | — | % | ||||||||
2022 | — | 100,000 | 100,000 | 12 | % | 2.964 | % | |||||||||||
2023 | 58,499 | 225,000 | 283,499 | 33 | % | 2.810 | % | |||||||||||
Thereafter | 2,500 | 475,000 | 477,500 | 55 | % | 4.129 | % | |||||||||||
Total | $ | 60,999 | $ | 800,000 | $ | 860,999 | 100 | % | 3.559 | % |
(1) | Excludes the effect of scheduled monthly principal payments on amortizing loans. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 13 | ||
Portfolio Overview. | ||
At September 30, 2019 | (unaudited results) | |
Consolidated Portfolio: |
Rentable Square Feet | Occupancy % | In-Place ABR(2) | |||||||||||||||||||||||||||
Market | # Properties | Same Properties Portfolio | Non-Same Properties Portfolio | Total Portfolio | Same Properties Portfolio | Non-Same Properties Portfolio | Total Portfolio | Total Portfolio Excluding Repositioning(1) | Total (in 000’s) | Per Square Foot | |||||||||||||||||||
Central LA | 10 | 537,721 | 1,007,662 | 1,545,383 | 95.4 | % | 100.0 | % | 98.4 | % | 98.4 | % | $ | 14,483 | $9.52 | ||||||||||||||
Greater San Fernando Valley | 40 | 2,735,192 | 1,240,857 | 3,976,049 | 98.3 | % | 88.7 | % | 95.3 | % | 98.8 | % | 38,264 | $10.10 | |||||||||||||||
Mid-Counties | 15 | 870,152 | 339,698 | 1,209,850 | 98.6 | % | 83.0 | % | 94.2 | % | 99.0 | % | 11,833 | $10.38 | |||||||||||||||
San Gabriel Valley | 20 | 2,023,933 | 667,143 | 2,691,076 | 98.0 | % | 100.0 | % | 98.5 | % | 98.5 | % | 23,375 | $8.82 | |||||||||||||||
South Bay | 27 | 2,658,178 | 795,683 | 3,453,861 | 95.0 | % | 97.1 | % | 95.5 | % | 96.5 | % | 33,286 | $10.09 | |||||||||||||||
Los Angeles County | 112 | 8,825,176 | 4,051,043 | 12,876,219 | 97.1 | % | 94.5 | % | 96.3 | % | 98.1 | % | 121,241 | $9.78 | |||||||||||||||
North Orange County | 9 | 812,666 | 282,002 | 1,094,668 | 96.7 | % | 100.0 | % | 97.6 | % | 97.6 | % | 9,870 | $9.24 | |||||||||||||||
OC Airport | 7 | 601,578 | 37,592 | 639,170 | 89.7 | % | 100.0 | % | 90.4 | % | 99.5 | % | 6,591 | $11.41 | |||||||||||||||
South Orange County | 3 | 329,458 | — | 329,458 | 100.0 | % | — | % | 100.0 | % | 100.0 | % | 3,157 | $9.58 | |||||||||||||||
West Orange County | 6 | 650,276 | 120,800 | 771,076 | 100.0 | % | — | % | 84.3 | % | 100.0 | % | 5,689 | $8.75 | |||||||||||||||
Orange County | 25 | 2,393,978 | 440,394 | 2,834,372 | 96.3 | % | 72.6 | % | 92.6 | % | 98.9 | % | 25,307 | $9.64 | |||||||||||||||
Inland Empire East | 1 | 51,867 | — | 51,867 | 100.0 | % | — | % | 100.0 | % | 100.0 | % | 359 | $6.92 | |||||||||||||||
Inland Empire West | 20 | 3,416,855 | 238,568 | 3,655,423 | 97.9 | % | 96.4 | % | 97.8 | % | 97.8 | % | 28,698 | $8.03 | |||||||||||||||
San Bernardino County | 21 | 3,468,722 | 238,568 | 3,707,290 | 98.0 | % | 96.4 | % | 97.9 | % | 97.9 | % | 29,057 | $8.01 | |||||||||||||||
Ventura | 17 | 1,744,992 | 763,977 | 2,508,969 | 96.2 | % | 78.4 | % | 90.8 | % | 96.4 | % | 21,555 | $9.46 | |||||||||||||||
Ventura County | 17 | 1,744,992 | 763,977 | 2,508,969 | 96.2 | % | 78.4 | % | 90.8 | % | 96.4 | % | 21,555 | $9.46 | |||||||||||||||
Central San Diego | 14 | 1,106,337 | 133,679 | 1,240,016 | 99.5 | % | 20.4 | % | 90.9 | % | 99.5 | % | 14,540 | $12.89 | |||||||||||||||
North County San Diego | 15 | 632,436 | 938,278 | 1,570,714 | 89.6 | % | 90.6 | % | 90.2 | % | 90.2 | % | 16,040 | $11.32 | |||||||||||||||
South County San Diego | 1 | 76,701 | — | 76,701 | 95.6 | % | — | % | 95.6 | % | 95.6 | % | 743 | $10.14 | |||||||||||||||
San Diego County | 30 | 1,815,474 | 1,071,957 | 2,887,431 | 95.9 | % | 81.8 | % | 90.6 | % | 94.1 | % | 31,323 | $11.97 | |||||||||||||||
CONSOLIDATED TOTAL / WTD AVG | 205 | 18,248,342 | 6,565,939 | 24,814,281 | 97.0 | % | 89.2 | % | 94.9 | % | 97.5 | % | $ | 228,483 | $9.70 |
(1) | Excludes space aggregating 666,559 square feet at nine of our properties that were in various stages of repositioning or lease-up as of September 30, 2019. See pages 20-21 for additional details on these properties. |
(2) | See page 26 for definition and details on how these amounts are calculated. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 14 | ||
Occupancy and Leasing Trends. | ||
(unaudited results, data represents consolidated portfolio only) | ||
Occupancy by County: |
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | ||||||
Occupancy:(1) | ||||||||||
Los Angeles County | 96.3% | 96.0% | 96.0% | 96.1% | 95.1% | |||||
Orange County | 92.6% | 90.9% | 91.4% | 95.1% | 95.1% | |||||
San Bernardino County | 97.9% | 97.8% | 97.4% | 96.9% | 96.5% | |||||
Ventura County | 90.8% | 85.1% | 84.8% | 88.6% | 89.0% | |||||
San Diego County | 90.6% | 92.5% | 97.4% | 95.2% | 97.9% | |||||
Total/Weighted Average | 94.9% | 94.2% | 94.6% | 95.4% | 95.1% | |||||
Consolidated Portfolio SF | 24,814,281 | 23,874,494 | 22,144,631 | 21,295,443 | 20,505,157 |
Leasing Activity: | ||||||||||
Three Months Ended | ||||||||||
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | ||||||
Leasing Activity (SF):(2) | ||||||||||
New leases(3) | 396,115 | 651,023 | 527,869 | 168,758 | 583,257 | |||||
Renewal leases(3) | 618,982 | 1,069,391 | 604,014 | 463,065 | 360,430 | |||||
Gross leasing | 1,015,097 | 1,720,414 | 1,131,883 | 631,823 | 943,687 | |||||
Expiring leases | 1,011,691 | 1,289,743 | 916,362 | 706,693 | 733,237 | |||||
Expiring leases - placed into repositioning | — | — | 132,650 | 18,957 | 49,166 | |||||
Net absorption | 3,406 | 430,671 | 82,871 | (93,827) | 161,284 | |||||
Retention rate(4) | 62% | 85% | 70% | 67% | 55% |
Weighted Average New / Renewal Leasing Spreads: | ||||||||||
Three Months Ended | ||||||||||
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | ||||||
GAAP Rent Change | 31.2% | 39.4% | 26.2% | 25.1% | 32.2% | |||||
Cash Rent Change | 19.4% | 22.3% | 17.3% | 14.8% | 21.1% |
(1) | See page 14 for the occupancy by County of our total consolidated portfolio excluding repositioning space. |
(2) | Excludes month-to-month tenants. |
(3) | Renewal leasing activity for Q3'19, Q2'19, Q1'19, Q4'18 and Q3'18 excludes relocations/expansions within Rexford’s portfolio totaling 7,028, 32,496, 34,737, 7,537 and 42,716 rentable square feet, respectively, which are included as part of new leasing activity. |
(4) | Retention rate is calculated as renewal lease square footage plus relocation/expansion square footage noted in (3) above, divided by expiring lease square footage (excluding expiring lease square footage placed into repositioning). |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 15 | ||
Leasing Statistics. | ||
(unaudited results, data represents consolidated portfolio only) | ||
Leasing Activity: |
# Leases Signed | SF of Leasing | Weighted Average Lease Term (Years) | ||||
Third Quarter 2019: | ||||||
New | 40 | 396,115 | 5.0 | |||
Renewal | 51 | 618,982 | 4.2 | |||
Total/Weighted Average | 91 | 1,015,097 | 4.5 |
Change in Annual Rental Rates and Turnover Costs for Current Quarter Leases: | ||||||||||||||||
GAAP Rent | Cash Rent | |||||||||||||||
Third Quarter 2019: | Current Lease | Prior Lease | Rent Change - GAAP | Weighted Average Abatement (Months) | Starting Cash Rent - Current Lease | Expiring Cash Rent - Prior Lease | Rent Change - Cash | Turnover Costs per SF(3) | ||||||||
New(1) | $13.08 | $9.47 | 38.2% | 1.1 | $12.71 | $10.08 | 26.1% | $4.60 | ||||||||
Renewal(2) | $11.17 | $8.65 | 29.1% | 1.0 | $10.85 | $9.24 | 17.5% | $1.10 | ||||||||
Weighted Average | $11.57 | $8.82 | 31.2% | 1.0 | $11.25 | $9.42 | 19.4% | $1.84 |
Uncommenced Leases by County: | ||||||||||||
Market | Uncommenced Renewal Leases: Leased SF(4) | Uncommenced New Leases: Leased SF(4) | Percent Leased | ABR Under Uncommenced Leases (in thousands)(5)(6) | In-Place + Uncommenced ABR (in thousands)(5)(6) | In-Place + Uncommenced ABR per SF(6) | ||||||
Los Angeles County | 1,080,421 | — | 96.3% | $1,370 | $122,612 | $9.89 | ||||||
Orange County | 348,695 | 11,692 | 93.0% | 1,016 | 26,323 | $9.98 | ||||||
San Bernardino County | 109,562 | — | 97.9% | 128 | 29,186 | $8.04 | ||||||
San Diego County | 377,922 | 19,161 | 91.3% | 437 | 31,759 | $12.05 | ||||||
Ventura County | 104,816 | — | 90.8% | 97 | 21,651 | $9.50 | ||||||
Total/Weighted Average | 2,021,416 | 30,853 | 95.0% | $3,048 | $231,531 | $9.82 |
(1) | GAAP and cash rent statistics and turnover costs for new leases exclude 11 leases aggregating 231,045 rentable square feet for which there was no comparable lease data. Of these 11 excluded leases, five leases for 139,535 rentable square feet relates to current year repositioning/redevelopment properties. Comparable leases generally exclude: (i) space that has never been occupied under our ownership, (ii) repositioned/redeveloped space, (iii) space that has been vacant for over one year or (iv) lease terms shorter than six months. |
(2) | GAAP and cash rent statistics and turnover costs for renewal leases excludes one lease for 2,240 rentable square feet for which there was no comparable lease data, due to either (i) space with different lease structures or (ii) lease term shorter than six months. |
(3) | Turnover costs include estimated tenant improvement and leasing costs associated with leases executed during the current period. Excludes costs for first generation leases. |
(4) | Reflects the square footage of renewal and new leases, respectively, that have been signed but have not yet commenced as of September 30, 2019. |
(5) | Includes $0.4 million of annualized base rent under Uncommenced New Leases and $2.7 million of incremental annualized base rent under Uncommenced Renewal Leases. |
(6) | See page 26 for further details on how these amounts are calculated. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 16 | ||
Leasing Statistics (Continued). | ||
(unaudited results, data represents consolidated portfolio only) | ||
Lease Expiration Schedule as of September 30, 2019: |
Year of Lease Expiration | # of Leases Expiring | Total Rentable SF | In-Place + Uncommenced ABR (in thousands) | In-Place + Uncommenced ABR per SF | ||||||
Available | — | 759,811 | $ | — | $— | |||||
Current Repositioning(1) | — | 475,416 | — | $— | ||||||
MTM Tenants | 64 | 67,473 | 1,149 | $17.03 | ||||||
2019 | 75 | 444,220 | 4,001 | $9.01 | ||||||
2020 | 343 | 4,262,043 | 38,926 | $9.13 | ||||||
2021 | 341 | 4,861,143 | 44,701 | $9.20 | ||||||
2022 | 292 | 3,374,332 | 34,555 | $10.24 | ||||||
2023 | 141 | 2,639,017 | 28,481 | $10.79 | ||||||
2024 | 103 | 3,022,997 | 31,334 | $10.37 | ||||||
2025 | 22 | 1,140,450 | 10,560 | $9.26 | ||||||
2026 | 14 | 652,687 | 7,027 | $10.77 | ||||||
2027 | 7 | 252,538 | 2,524 | $10.00 | ||||||
2028 | 6 | 348,447 | 3,211 | $9.22 | ||||||
Thereafter | 16 | 2,513,707 | 25,062 | $9.97 | ||||||
Total Portfolio | 1,424 | 24,814,281 | $ | 231,531 | $9.82 |
(1) | Represents space at six of our properties that were classified as current repositioning as of September 30, 2019. Excludes completed repositioning properties, pre-leased repositioning space, properties in lease-up and future repositioning properties. See pages 20-21 for additional details on these properties. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 17 | ||
Top Tenants and Lease Segmentation. | ||
(unaudited results, data represents consolidated portfolio only) | ||
Top 10 Tenants: |
Tenant | Submarket | Leased Rentable SF | % of In-Place + Uncommenced ABR | In-Place + Uncommenced ABR per SF | Lease Expiration | |||||
Federal Express Corporation | South Bay | 527,861 | 3.0% | $13.23 | 11/30/2032(1) | |||||
Unified Natural Foods, Inc. | Central LA | 695,120 | 2.3% | $7.63 | 5/8/2038 | |||||
Omega/Cinema Props, Inc. | Central LA | 238,015 | 1.0% | $10.08 | 12/31/2029 | |||||
Triscenic Production Services, Inc. | Greater San Fernando Valley | 284,273 | 1.0% | $8.06 | 9/30/2024 (2) | |||||
32 Cold, LLC | Central LA | 149,157 | 1.0% | $15.32 | 3/31/2026 (3) | |||||
Dendreon Pharmaceuticals, LLC | West Orange County | 170,865 | 0.9% | $12.92 | 2/28/2030 | |||||
Goldencorr Sheets, LLC | San Gabriel Valley | 256,993 | 0.9% | $7.92 | 4/30/2025 | |||||
Universal Technical Institute of Southern California, LLC | South Bay | 142,593 | 0.9% | $14.10 | 8/31/2030 | |||||
Cosmetic Laboratories of America, LLC | Greater San Fernando Valley | 319,348 | 0.9% | $6.28 | 6/30/2020 | |||||
Southland Industries, a California corporation | West Orange County | 207,953 | 0.8% | $9.27 | 5/31/2028 | |||||
Top 10 Total / Weighted Average | 2,992,178 | 12.7% | $9.84 |
(1) | Includes (i) 30,160 rentable square feet expiring September 30, 2027, (ii) 42,270 rentable square feet expiring October 31, 2030, (iii) 311,995 rentable square feet expiring February 28, 2031, and (vi) 143,436 rentable square feet expiring November 30, 2032. |
(2) | Includes (i) 38,766 rentable square feet expiring November 30, 2019, (ii) 147,318 rentable square feet expiring September 30, 2021, (iii) 69,219 rentable square feet expiring March 31, 2022, and (iv) 28,970 rentable square feet expiring September 30, 2024. |
(3) | Includes (i) 78,280 rentable square feet expiring September 30, 2025, and (ii) 70,877 rentable square feet expiring March 31, 2026. |
Lease Segmentation by Size: | ||||||||||||||||||
Square Feet | Number of Leases | Leased Rentable SF | Rentable SF | Leased % | Leased % Excluding Repositioning | In-Place + Uncommenced ABR (in thousands)(1) | % of In-Place + Uncommenced ABR | In-Place + Uncommenced ABR per SF(1) | ||||||||||
<4,999 | 740 | 1,607,101 | 1,673,634 | 96.0% | 96.0% | $ | 21,558 | 9.3% | $13.41 | |||||||||
5,000 - 9,999 | 211 | 1,494,302 | 1,579,150 | 94.6% | 94.6% | 18,526 | 8.0% | $12.40 | ||||||||||
10,000 - 24,999 | 250 | 3,954,298 | 4,257,913 | 92.9% | 94.2% | 44,531 | 19.2% | $11.26 | ||||||||||
25,000 - 49,999 | 113 | 4,051,133 | 4,305,683 | 94.1% | 98.3% | 41,427 | 17.9% | $10.23 | ||||||||||
>50,000 | 110 | 12,472,219 | 12,997,901 | 96.0% | 99.2% | 105,489 | 45.6% | $8.46 | ||||||||||
Total / Weighted Average | 1,424 | 23,579,053 | 24,814,281 | 95.0% | 97.6% | $ | 231,531 | 100.0% | $9.82 |
(1) | See page 26 for further details on how these amounts are calculated. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 18 | ||
Capital Expenditure Summary. | ||
(unaudited results, in thousands, except square feet and per square foot data) | ||
Nine Months Ended September 30, 2019 |
Year to Date | ||||||||||||||||||||||
Q3-2019 | Q2-2019 | Q1-2019 | Total | SF(1) | PSF | |||||||||||||||||
Tenant Improvements and Space Preparation: | ||||||||||||||||||||||
New Leases‐1st Generation | $ | 260 | $ | 363 | $ | 41 | $ | 664 | 204,257 | $ | 3.25 | |||||||||||
New Leases‐2nd Generation | $ | 56 | $ | 12 | $ | 9 | 77 | 31,890 | $ | 2.41 | ||||||||||||
Renewals | $ | 39 | $ | 33 | $ | — | 72 | 132,207 | $ | 0.54 | ||||||||||||
Total Tenant Improvements and Space Preparation | 355 | 408 | 50 | $ | 813 | |||||||||||||||||
Leasing Commissions & Lease Costs: | ||||||||||||||||||||||
New Leases‐1st Generation | $ | 904 | $ | 2,428 | $ | 241 | $ | 3,573 | 1,139,417 | $ | 3.14 | |||||||||||
New Leases‐2nd Generation | $ | 591 | $ | 507 | $ | 976 | 2,074 | 846,086 | $ | 2.45 | ||||||||||||
Renewals | $ | 525 | $ | 806 | $ | 224 | 1,555 | 1,163,411 | $ | 1.34 | ||||||||||||
Total Leasing Commissions & Lease Costs | 2,020 | 3,741 | 1,441 | $ | 7,202 | |||||||||||||||||
Total Recurring Capex | $ | 1,851 | $ | 1,280 | $ | 2,294 | $ | 5,425 | 23,128,029 | $ | 0.23 | |||||||||||
Recurring Capex % of NOI | 3.6 | % | 2.6 | % | 5.0 | % | 3.7 | % | ||||||||||||||
Recurring Capex % of Operating Revenue | 2.8 | % | 2.0 | % | 3.8 | % | 2.9 | % | ||||||||||||||
Nonrecurring Capex: | ||||||||||||||||||||||
Development and Repositioning(2) | $ | 4,192 | $ | 3,080 | $ | 2,937 | $ | 10,209 | ||||||||||||||
Other Repositioning(3) | 3,853 | 3,424 | 3,077 | 10,354 | ||||||||||||||||||
Other(4) | 771 | 168 | 1,765 | 2,704 | ||||||||||||||||||
Total Nonrecurring Capex | $ | 8,816 | $ | 6,672 | $ | 7,779 | $ | 23,267 | 15,987,120 | $ | 1.46 | |||||||||||
Other Capitalized Costs(5) | $ | 2,423 | $ | 2,049 | $ | 1,529 | $ | 6,001 |
(1) | For tenant improvements and leasing commissions, reflects the aggregate square footage of the leases in which we incurred such costs, excluding new/renewal leases in which there were no tenant improvements and/or leasing commissions. For recurring capex, reflects the weighted average square footage of our consolidated portfolio for the period (including properties that were sold during the period). For nonrecurring capex, reflects the aggregate square footage of the properties in which we incurred such capital expenditures. |
(2) | Includes capital expenditures related to properties that were under development or repositioning as of September 30, 2019. For details on these properties see pages 20-21. |
(3) | Includes capital expenditures related to other space under repositioning or renovation that are not included on pages 20-21 due to smaller space size or limited downtime for completion. |
(4) | Includes other nonrecurring capital expenditures including, but not limited to, costs incurred for replacements of either roof or parking lots, and ADA related construction. |
(5) | Includes the following capitalized costs: (i) compensation costs of personnel directly responsible for and who spend their time on development, renovation and rehabilitation activity and (ii) interest, property taxes and insurance costs incurred during the development and construction periods of repositioning or development projects. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 19 | ||
Properties and Space Under Repositioning/Development.(1) | ||
As of September 30, 2019 | (unaudited results, in thousands, except square feet) |
Repositioning/Development Properties | |||||||||||||||||||||||||||||||||||||||||||
Same Property Portfolio | Estimated Construction Period | ||||||||||||||||||||||||||||||||||||||||||
Property (Submarket) | Total Property Rentable Square Feet | Space Under Repo/ Lease-Up | Est. New Dev. Rentable Square Feet(2) | Total Property Leased % 9/30/19 | 2019 | Start | Target Completion | Est. Period until Stabilized (months)(3) | Purchase Price(4) | Projected Repo Costs | Projected Total Investment(5) | Cumulative Investment to Date(6) | Actual Quarterly Cash NOI 3Q-2019(7) | Est. Annual Stabilized Cash NOI(8) | |||||||||||||||||||||||||||||
CURRENT REPOSITIONING: | |||||||||||||||||||||||||||||||||||||||||||
28903 Ave. Paine - Dev. (SF Valley) | — | — | 111,024 | 0% | N | 3Q-2019 | 3Q-2020 | 13 - 16 | $ | 5,515 | $ | 11,869 | $ | 17,384 | $ | 6,257 | $ | — | $ | 1,047 | |||||||||||||||||||||||
851 Lawrence Drive (Ventura) | 49,976 | 49,976 | 39,294 | (9) | 0% | N | 2Q-2018 | 3Q-2020 | 13 - 16 | $ | 6,663 | $ | 9,723 | $ | 16,386 | $ | 7,133 | $ | (9 | ) | $ | 979 | |||||||||||||||||||||
29003 Avenue Sherman (SF Valley) | 68,123 | 68,123 | — | 0% | N | 3Q-2018 | 4Q-2019 | 3 - 5 | $ | 9,531 | $ | 1,338 | $ | 10,869 | $ | 10,178 | $ | (6 | ) | $ | 560 | ||||||||||||||||||||||
12821 Knott Street (West OC) | 120,800 | 120,800 | 39,847 | 0% | N | 1Q-2019 | 3Q-2020 | 13 - 16 | $ | 19,768 | $ | 9,714 | $ | 29,482 | $ | 20,033 | $ | (20 | ) | $ | 1,647 | ||||||||||||||||||||||
16121 Carmenita Rd. (Mid-Counties) | 109,780 | 57,855 | — | 47% | N | 1Q-2019 | 4Q-2019 | 2 - 4 | $ | 13,452 | $ | 2,584 | $ | 16,036 | $ | 15,131 | $ | (6 | ) | $ | 906 | ||||||||||||||||||||||
635 8th Street (SF Valley) | 72,250 | 72,250 | — | 0% | N | 2Q-2019 | 1Q-2020 | 8 - 10 | $ | 14,668 | $ | 2,423 | $ | 17,091 | $ | 14,683 | $ | (10 | ) | $ | 834 | ||||||||||||||||||||||
10015 Waples Court (Central SD) | 106,412 | 106,412 | — | 0% | N | 2Q-2019 | 1Q-2020 | 6 - 9 | $ | 21,435 | $ | 3,963 | $ | 25,398 | $ | 21,494 | $ | (11 | ) | $ | 1,356 | ||||||||||||||||||||||
The Merge (Inland Empire West)(10) | — | — | 333,491 | 0% | N | 2Q-2019 | 2Q-2020 | 15 - 18 | $ | 23,827 | $ | 32,887 | $ | 56,714 | $ | 25,136 | $ | (3 | ) | $ | 2,708 | ||||||||||||||||||||||
TOTAL/WEIGHTED AVERAGE | 527,341 | 475,416 | 523,656 | $ | 114,859 | $ | 74,501 | $ | 189,360 | $ | 120,045 | $ | (65 | ) | (11) | $ | 10,037 | ||||||||||||||||||||||||||
LEASE-UP: | |||||||||||||||||||||||||||||||||||||||||||
2722 Fairview Street (OC Airport) | 116,575 | 58,802 | — | 50% | Y | 1Q-2018 | 4Q-2018 | 4 - 7 | $ | 17,800 | $ | 1,679 | $ | 19,479 | $ | 18,949 | $ | 101 | $ | 1,184 | |||||||||||||||||||||||
2455 Conejo Spectrum St.(Ventura)(12) | 98,218 | 55,714 | — | 43% | N | 1Q-2019 | 3Q-2019 | 3 - 5 | $ | 19,035 | $ | 1,125 | $ | 20,160 | $ | 19,781 | $ | (3 | ) | $ | 986 | ||||||||||||||||||||||
TOTAL/WEIGHTED AVERAGE | 214,793 | 114,516 | — | $ | 36,835 | $ | 2,804 | $ | 39,639 | $ | 38,730 | $ | 98 | (11) | $ | 2,170 | |||||||||||||||||||||||||||
STABILIZED: | |||||||||||||||||||||||||||||||||||||||||||
1580 Carson Street (South Bay) | 43,787 | — | — | 100% | N | -- | -- | -- | $ | 7,715 | $ | 1,570 | $ | 9,285 | $ | 9,159 | $ | 59 | $ | 585 | |||||||||||||||||||||||
FUTURE REPOSITIONING: | |||||||||||||||||||||||||||||||||||||||||||
9615 Norwalk Blvd. (Mid-Counties) | 38,362 | — | 201,808 | (13) | 69% | Y | 3Q-2020 | 2021 | TBD | $ | 9,642 | $ | 20,004 | $ | 29,646 | $ | 10,302 | $ | 238 | $ | 1,925 |
(1) | See page 28 for a definition of Properties and Space Under Repositioning. |
(2) | Represents the estimated rentable square footage to be added upon completion of current development projects. |
(3) | Represents the estimated remaining number of months, as of September 30, 2019, for the property to reach stabilization. Includes time to complete construction and lease-up the property. Actual number of months required to reach stabilization may vary materially from our estimates. See page 29 for a definition of Stabilization Date - Properties and Space Under Repositioning. |
(4) | Includes contractual purchase price plus closing costs. |
(5) | Projected total investment includes the purchase price of the property and our current estimate of total expected nonrecurring capital expenditures to be incurred on each repositioning and development project to reach completion. We expect to update our estimates upon completion of the project, or sooner if there are any significant changes to expected costs from quarter to quarter. |
(6) | Cumulative investment-to-date includes the purchase price of the property and subsequent costs incurred for nonrecurring capital expenditures. |
(7) | Represents the actual cash NOI for each property for the three months ended September 30, 2019. For a definition/discussion of non-GAAP financial measures, see the definitions section beginning on pg. 26 of this report. |
(8) | Represents management’s estimate of each property’s annual cash NOI once the property has reached stabilization and initial rental concessions, if any, have elapsed. Actual results may vary materially from our estimates. |
(9) | We expect to demolish the existing 49,976 RSF building and construct a new 89,270 RSF multi-unit building. |
(10) | The Merge is a fully entitled industrial development site on which we plan to build six industrial buildings totaling 333,491 RSF. |
(11) | Actual NOI for the three months ended September 30, 2019, reflects the capitalization of $369 thousand of real estate property taxes and insurance for current repositioning and $46 thousand for stabilized properties. We will continue to capitalize taxes and insurance during the period in which construction is taking place to get each repositioning property ready for its intended use. |
(12) | We acquired Conejo Spectrum Business Park, a nine-building property, during 1Q-2019. Amounts presented on this page represent one of the nine buildings, located at 2455 Conejo Spectrum Street. |
(13) | 9615 Norwalk is a 10.26 acre storage-yard with three buildings totaling 38,362 RSF. In January 2019, we converted the tenant’s MTM land lease to a term lease with an expiration date of June 30, 2020. We will demolish the existing buildings and construct a new 201,808 RSF building upon termination of the land lease. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 20 | ||
Properties and Space Under Repositioning/Development (Continued). (1) | ||
As of September 30, 2019 | (unaudited results, in thousands, except square feet) |
Repositioning Space | |||||||||||||||||||||||||||||||
Same Property Portfolio | Estimated Construction Period | ||||||||||||||||||||||||||||||
Property (Submarket) | Total Property Rentable Square Feet | Space Under Repositioning/Lease-Up | 2019 | Start | Target Completion | Est. Period until Stabilized (months)(2) | Projected Repositioning Cost(3) | Repositioning Costs Incurred to Date | Total Property Leased % 9/30/19 | Actual Quarterly Cash NOI 3Q-2019(4) | Estimated Annual Stabilized Cash NOI(5) | ||||||||||||||||||||
LEASE-UP: | |||||||||||||||||||||||||||||||
3233 Mission Oaks Blvd. - Unit 3233 (Ventura)(6) | 461,717 | 39,210 | Y | 2Q-2017 | 3Q-2019 | 6 - 9 | $ | 9,065 | $ | 8,807 | 88% | $ | 37 | $ | 939 | ||||||||||||||||
7110 E. Rosecrans Avenue - Unit B (South Bay)(7) | 74,856 | 37,417 | Y | 1Q-2019 | 3Q-2019 | 6 - 9 | $ | 1,293 | $ | 1,129 | 50% | $ | (6 | ) | $ | 307 | |||||||||||||||
TOTAL | 76,627 | $ | 10,358 | $ | 9,936 | $ | 31 | (8) | $ | 1,246 | |||||||||||||||||||||
Stabilized Repositionings: Properties and Space | |||||||||||||||||||||||||||||||
Property (Submarket) | Rentable Square Feet | Stabilized Period | Stabilized Yield | ||||||||||||||||||||||||||||
3233 Mission Oaks Blvd. - Unit H (Ventura) | 43,927 | 1Q-2018 | N/A(9) | ||||||||||||||||||||||||||||
1601 Alton Pkwy. (OC Airport) | 124,988 | 3Q-2018 | 5.6%(10) | ||||||||||||||||||||||||||||
301-445 Figueroa Street (South Bay) | 133,650 | 3Q-2018 | 7.8% | ||||||||||||||||||||||||||||
28903 Ave. Paine - Repo. (SF Valley) | 111,935 | 4Q-2018 | 6.1% | ||||||||||||||||||||||||||||
14750 Nelson (San Gabriel Valley) | 201,990 | 1Q-2019 | 8.0% | ||||||||||||||||||||||||||||
1998 Surveyor Avenue (Ventura) | 56,306 | 1Q-2019 | 5.8% | ||||||||||||||||||||||||||||
15401 Figueroa Street (South Bay) | 38,584 | 1Q-2019 | 7.2% | ||||||||||||||||||||||||||||
1332-1340 Rocky Pt. Dr. (North SD) | 73,747 | 1Q-2019 | 6.5% | ||||||||||||||||||||||||||||
1580 Carson Street (South Bay) | 43,787 | 3Q-2019 | 6.3% |
(1) | See page 28 for a definition of Properties and Space Under Repositioning. |
(2) | Represents the estimated remaining number of months, as of September 30, 2019, for the space to reach stabilization. Includes time to complete construction and lease-up the space. Actual number of months required to reach stabilization may vary materially from our estimates. |
(3) | Projected repositioning cost represents the estimated nonrecurring capital expenditures to be incurred for the repositioning to reach completion. Excludes historical cost of the land and building. We expect to update our estimates upon completion of the project, or sooner if there are any significant changes to expected costs from quarter to quarter. |
(4) | Represents the actual cash NOI of repositioning space for the three months ended September 30, 2019. For a definition & discussion of non-GAAP financial measures, see the definitions section beginning on page 26. |
(5) | Based on management estimates of annual cash NOI for the repositioning space, once the property has reached stabilization and initial rental concessions, if any, have elapsed. Actual results may vary materially from our estimates. The Company does not provide a reconciliation to net income on a consolidated basis, because it is unable to provide a meaningful or accurate estimation of reconciling items due to the inherent difficulty of forecasting the timing and/or amount of various items that would impact net income. |
(6) | As of September 30, 2019, we have completed the repositioning of space aggregating 109,636 RSF at 3233 Mission Oaks which is comprised of eight units. The amounts presented on this page represent the actual and projected construction costs and the actual and estimated stabilized cash NOI of only the space under repositioning vs. the entire property. As of September 30, 2019, five units totaling 70,426 RSF have been leased and three units totaling 39,210 RSF are available for lease. |
(7) | As of September 30, 2019, we have completed the repositioning of a 37,417 RSF unit at 7110 Rosecrans Avenue. The amounts presented on this page represent the actual and projected construction costs and the actual and estimated stabilized cash NOI of only the space under repositioning vs. the entire property. |
(8) | Actual NOI for the three months ended September 30, 2019, reflects the capitalization of $24 thousand of real estate property taxes and insurance for lease-up space. We capitalize real estate property taxes and insurance during the period in which construction is taking place to get each repositioning space ready for its intended use. |
(9) | We are unable to provide a meaningful stabilized yield for this completed project as this was a partial repositioning of a larger property. |
(10) | Represents the yield based on 87% occupancy as of the stabilization date, which is one year after the completion of repositioning construction work. With the lease-up of the final unit during Q2-19, the property is 100% leased and has a stabilized yield of 7.5%. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 21 | ||
Current Year Acquisitions and Dispositions Summary. | ||
As of September 30, 2019 | (unaudited results, data represents consolidated portfolio only) |
2019 Current Period Acquisitions | |||||||||||||||
Acquisition Date | Property Address | County | Submarket | Rentable Square Feet | Acquisition Price ($ in MM) | Occ. % at Acquisition | Occ.% at Sept 30, 2019 | ||||||||
1/15/2019 | 12821 Knott Street | Orange | West Orange County | 120,800 | $19.80 | —% | —% | ||||||||
1/17/2019 | 28510 Industry Drive | Los Angeles | Greater San Fernando Valley | 46,778 | $7.77 | 100% | 100% | ||||||||
1/28/2019 | Conejo Spectrum Business Park | Ventura | Ventura | 531,378 | $106.25 | 72% | 80% | ||||||||
3/5/2019 | 2455 Ash Street | San Diego | North County San Diego | 42,508 | $6.68 | 100% | 100% | ||||||||
3/12/2019 | 25413 Rye Canyon Road | Los Angeles | Greater San Fernando Valley | 48,075 | $5.53 | 40% | 100% | ||||||||
4/10/2019 | 1515 15th Street(1) | Los Angeles | Central LA | 238,015 | $28.10 | —% | 100% | ||||||||
4/12/2019 | 13890 Nelson Avenue | Los Angeles | San Gabriel Valley | 256,993 | $41.81 | 100% | 100% | ||||||||
4/12/2019 | 445-449 Freedom Avenue | Orange | North Orange County | 92,647 | $17.96 | 100% | 100% | ||||||||
4/12/2019 | 2270 Camino Vida Roble | San Diego | North County San Diego | 106,311 | $16.79 | 70% | 75% | ||||||||
4/16/2019 | 980 Rancheros Drive | San Diego | North County San Diego | 48,878 | $7.90 | 100% | 100% | ||||||||
4/25/2019 | 1145 Arroyo Avenue | Los Angeles | Greater San Fernando Valley | 147,019 | $29.86 | 100% | 100% | ||||||||
4/25/2019 | 1150 Aviation Place | Los Angeles | Greater San Fernando Valley | 147,000 | $29.69 | 100% | 100% | ||||||||
4/25/2019 | 1175 Aviation Place | Los Angeles | Greater San Fernando Valley | 92,455 | $17.84 | 100% | 100% | ||||||||
4/25/2019 | 1245 Aviation Place | Los Angeles | Greater San Fernando Valley | 132,936 | $26.06 | 100% | 100% | ||||||||
4/25/2019 | 635 8th Street | Los Angeles | Greater San Fernando Valley | 72,250 | $14.66 | —% | —% | ||||||||
4/25/2019 | 10015 Waples Court | San Diego | Central San Diego | 106,412 | $21.30 | —% | —% | ||||||||
4/30/2019 | 19100 Susana Road | Los Angeles | South Bay | 52,714 | $13.51 | 100% | 100% | ||||||||
5/3/2019 | 15385 Oxnard Street | Los Angeles | Greater San Fernando Valley | 71,467 | $16.80 | 100% | 100% | ||||||||
5/16/2019 | 9750-9770 San Fernando Road | Los Angeles | Greater San Fernando Valley | 35,624 | $7.44 | 100% | 100% | ||||||||
5/31/2019 | 218 Turnbull Canyon | Los Angeles | San Gabriel Valley | 190,900 | $27.10 | 100% | 100% | ||||||||
6/6/2019 | The Merge(2) | San Bernardino | Inland Empire West | — | (2) | $23.20 | (2) | -- | -- | ||||||
7/3/2019 | 3340 San Fernando Road | Los Angeles | Greater San Fernando Valley | — | (3) | $3.00 | -- | -- | |||||||
7/31/2019 | 5725 Eastgate Drive | San Diego | Central San Diego | 27,267 | $8.15 | —% | 100% | ||||||||
8/29/2019 | 18115 Main Street | Los Angeles | South Bay | 42,270 | $6.75 | 100% | 100% | ||||||||
8/29/2019 | 3150 Ana Street | Los Angeles | South Bay | 105,970 | $18.80 | 100% | 100% | ||||||||
8/30/2019 | 1402 Avenida Del Oro | San Diego | North County San Diego | 311,995 | $73.55 | 100% | 100% | ||||||||
9/5/2019 | 9607-9623 Imperial Highway | Los Angeles | Mid-Counties | 7,466 | $10.51 | 100% | 100% | ||||||||
9/5/2019 | 12200 Bellflower Boulevard | Los Angeles | Mid-Counties | 54,161 | $16.33 | 100% | 100% | ||||||||
9/17/2019 | Storm Parkway | Los Angeles | South Bay | 267,503 | $66.17 | 91% | 91% | ||||||||
9/25/2019 | 2328 Teller Road | Ventura | Ventura | 126,317 | $23.27 | 93% | 93% | ||||||||
Total Acquisitions through September 30, 2019 | 3,524,109 | $712.58 |
(1) | In exchange for the property located at 1515 15th Street, the seller received 593,960 Series 1 CPOP Units, which are convertible by the holder at any time or by the Company beginning five years after issuance, in each case, into common units of the Operating Partnership on a one-for-one basis. The transaction was priced based upon a stock price of $31.56, equal to the trailing 30-day average closing price of the Company's common stock as of the letter of intent date. The Series 1 CPOP Units are entitled to cumulative cash distributions at a rate of 4.43937% per year using a per unit stated value of $45.50952 (a 44.2% premium to the $31.56 per share described above), all as more particularly described in the Current Report on Form 8-K filed with the SEC on April 10, 2019. |
(2) | The Merge is a fully entitled industrial development site on which we plan to build six industrial buildings totaling 333,491 RSF. We have retained the seller as fee developer to construct the project. The acquisition price includes $5.1 million of consideration held back in escrow to be released to the seller/developer upon meeting certain developer milestones. |
(3) | We acquired fee title to the parcel of land located at 3340 North San Fernando Road. Prior to the acquisition, we leased the parcel of land from the seller under a long-term ground lease. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 22 | ||
Current Year Acquisitions and Dispositions Summary (Continued). | ||
As of September 30, 2019 | (unaudited results, data represents consolidated portfolio only) |
2019 Subsequent Period Acquisitions | ||||||||||||||||
Acquisition Date | Property Address | County | Submarket | Rentable Square Feet | Acquisition Price ($ in MM) | Occ. % at Acquisition | Occ.% at Sept 30, 2019 | |||||||||
10/3/2019 | 6277-6289 Slauson Avenue | Los Angeles | Central LA | 336,085 | $41.26 | 98% | n/a | |||||||||
10/4/2019 | 750 Manville Street | Los Angeles | South Bay | 59,996 | $11.51 | 100% | n/a | |||||||||
10/25/2019 | 8985 Crestmar Point | San Diego | Central San Diego | 55,816 | $7.99 | 88% | n/a | |||||||||
Total Year-to-Date Acquisitions | 3,976,006 | 773.33 |
2019 Current Period Dispositions | |||||||||||||||
Disposition Date | Property Address | County | Submarket | Rentable Square Feet | Sale Price ($ in MM) | Reason for Selling | |||||||||
6/27/2019 | 2350-2384 Orangethorpe Avenue & 1631 Placentia Avenue | Orange | North Orange County | 62,395 | $11.58 | Opportunistic Sale | |||||||||
7/31/2019 | 939 Poinsettia Avenue - Unit 301 | San Diego | North County San Diego | 6,562 | $1.26 | Opportunistic Sale | |||||||||
Total Dispositions through September 30, 2019 | 68,957 | $12.84 | |||||||||||||
2019 Subsequent Period Dispositions | |||||||||||||||
Disposition Date | Property Address | County | Submarket | Rentable Square Feet | Sale Price ($ in MM) | Reason for Selling | |||||||||
10/11/2019 | 13914-13932 East Valley Boulevard | Los Angeles | San Gabriel Valley | 58,084 | $11.18 | Opportunistic Sale | |||||||||
Total Year-to-Date Dispositions | 127,041 | $24.02 |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 23 | ||
Guidance. | ||
As of September 30, 2019 |
METRIC | 2019 GUIDANCE / ASSUMPTIONS | |||||||
INITIAL GUIDANCE | Q1’19 UPDATED GUIDANCE | Q2’19 UPDATED GUIDANCE | Q3’19 UPDATED GUIDANCE | YTD RESULTS AS OF SEPT 30, 2019 | ||||
Net Income Attributable to Common Stockholders per diluted share (1) | $0.04 - $0.08 | $0.30 - $0.32 | é | $0.35 - $0.37 | é | $0.41 - $0.43 (2) | é | $0.29 |
Company share of Core FFO per diluted share (1) | $1.16 - $1.20 | $1.18 - $1.20 | é | $1.19 - $1.21 | é | $1.20 - $1.22 (2) | é | $0.91 |
Same Property Portfolio NOI Growth (3) | 3.5% - 5.5% | 4.5% - 6.0% | é | 5.0% - 6.5% | é | 5.5% - 6.5% | é | 6.6% |
Stabilized Same Property Portfolio NOI Growth (3) | 3.0% - 3.5% | 3.5% - 4.0% | é | 3.5% - 4.0% | — | 3.5% - 4.0% | — | 3.7% |
Year-End Same Property Portfolio Occupancy (3) | 95.5% - 96.5% | 95.5% - 96.5% | — | 96.0% - 97.0% | é | 96.0% - 97.0% | — | 97.0% |
Year-End Stabilized Same Property Portfolio Occupancy (3) | 96.5% - 97.5% | 96.5% - 97.5% | — | 97.0% - 97.5% | é | 97.0% - 97.5% | — | 97.7% |
General and Administrative Expenses (4) | $29.0M - $30.0M | $29.0M - $30.0M | — | $29.0M - $30.0M | — | $29.5M - $30.0M | é | $22.1M |
(1) | Our Net income and Core FFO guidance refers to the Company's in-place portfolio as of October 29, 2019, and does not include any assumptions for acquisitions, dispositions or balance sheet activities that may or may not occur later during the year. |
(2) | See page 29 for a reconciliation of the Company’s 2019 guidance range of net income attributable to common stockholders per diluted share, the most directly comparable forward-looking GAAP financial measure, to Core FFO per diluted share. |
(3) | Our Same Property Portfolio is a subset of our consolidated portfolio and consists of 146 properties aggregating 18,248,342 rentable square feet that were wholly-owned by us as of January 1, 2018, and still owned by us as of September 30, 2019. Our Stabilized Same Property Portfolio represents the properties included in our Same Property Portfolio, adjusted to exclude eight of our properties that were or will be in various stages of repositioning or lease-up during 2018 and 2019. See page 29 for the definition of Stabilized Same Property Portfolio which includes a list of these eight properties. |
(4) | Our general and administrative expense guidance includes (i) estimated non-cash equity compensation expense of $10.2 million and (ii) estimated internal leasing costs of $1.3 million that will be expensed during 2019 as a result of the adoption of ASC 842 effective January 1, 2019. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 24 | ||
Net Asset Value Components. | ||
As of September 30, 2019 | (unaudited and in thousands, except share data) |
Net Operating Income | ||
Pro Forma Net Operating Income (NOI)(1) | Three Months Ended September 30, 2019 | |
Total operating rental income | $67,020 | |
Property operating expenses | (16,165) | |
Pro forma effect of uncommenced leases(2) | 762 | |
Pro forma effect of acquisitions(3) | 2,142 | |
Pro forma effect of dispositions(4) | 5 | |
Pro forma NOI effect of properties and space under repositioning(5) | 3,630 | |
Pro Forma NOI | 57,394 | |
Amortization of net below-market lease intangibles | (2,065) | |
Straight line rental revenue adjustment | (2,080) | |
Pro Forma Cash NOI | $53,249 | |
Balance Sheet Items | ||
Other assets and liabilities | September 30, 2019 | |
Cash and cash equivalents | $197,508 | |
Rents and other receivables, net | 4,376 | |
Other assets | 10,778 | |
Acquisition related deposits | 8,415 | |
Accounts payable, accrued expenses and other liabilities | (34,669) | |
Dividends payable | (21,034) | |
Tenant security deposits | (27,688) | |
Prepaid rents | (7,759) | |
Estimated remaining cost to complete repositioning projects | (90,115) | |
Total other assets and liabilities | $39,812 | |
Debt and Shares Outstanding | ||
Total consolidated debt(6) | $860,999 | |
Preferred stock/units - liquidation preference | $278,281 | |
Common shares outstanding(7) | 110,669,277 | |
Operating partnership units outstanding(8) | 2,421,857 | |
Total common shares and operating partnership units outstanding | 113,091,134 |
(1) | For a definition and discussion of non-GAAP financial measures, see the notes and definitions section beginning on page 26 of this report. |
(2) | Represents the estimated incremental base rent from uncommenced new and renewal leases as if they had commenced as of July 1, 2019. |
(3) | Represents the estimated incremental NOI from Q3'19 acquisitions as if they had been acquired on July 1, 2019. We have made a number of assumptions in such estimates and there can be no assurance that we would have generated the projected levels of NOI had we actually owned the acquired entities as of July 1, 2019. |
(4) | Represents the deduction of actual Q3'19 NOI for the property that was sold during the current quarter. See page 23 for a detail of current year disposition properties. |
(5) | Represents the estimated incremental NOI from the properties that were classified as current or future repositioning or lease-up during the three months ended September 30, 2019, assuming that all repositioning work had been completed and all of the properties/space were fully stabilized as of July 1, 2019. See pages 20-21 for the properties included. We have made a number of assumptions in such estimates and there can be no assurance that we would have generated the projected levels of NOI had these properties actually been stabilized as of July 1, 2019. |
(6) | Excludes unamortized loan discount and debt issuance costs totaling $3.3 million. |
(7) | Represents outstanding shares of common stock of the Company, which excludes 214,995 shares of unvested restricted stock. |
(8) | Represents outstanding common units of the Company’s operating partnership, Rexford Industrial Realty, L.P., that are owned by unit holders other than Rexford Industrial Realty, Inc. Includes 276,674 vested LTIP Units and excludes 334,178 unvested LTIP Units and 591,767 unvested performance units. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 25 | ||
Notes and Definitions. | ||
• | In-Place Annualized Base Rent (“In-Place ABR”): Calculated as the monthly contractual base rent (before rent abatements) per the terms of the lease, as of September 30, 2019, multiplied by 12. Includes leases that have commenced as of September 30, 2019 or leases where tenant has taken early possession of space as of September 30, 2019. Excludes billboard and antenna revenue and tenant reimbursements. |
• | In-Place ABR per Square Foot: Calculated by dividing In-Place ABR for the lease by the occupied square feet of the lease, as of September 30, 2019. |
• | Combined In-Place and Uncommenced Annualized Base Rent (“In-Place + Uncommenced ABR”): Calculated by adding (i) In-Place ABR and (ii) ABR Under Uncommenced Leases (see definition below). Does not include adjustments for leases that expired and were not renewed subsequent to September 30, 2019, or adjustments for future known non-renewals. |
• | ABR Under Uncommenced Leases: Calculated by adding the following: |
• | In-Place + Uncommenced ABR per Square Foot: Calculated by dividing (i) In-Place + Uncommenced ABR for the leases by (ii) the square footage under commenced and uncommenced leases (net of renewal space) as of September 30, 2019. |
• | Uncommenced New Leases: Reflects new leases (for vacant space) that have been signed but have not yet commenced as of September 30, 2019. |
• | Uncommenced Renewal Leases: Reflects renewal leases (for space occupied by renewing tenant) that have been signed but have not yet commenced as of September 30, 2019. |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 26 | ||
Notes and Definitions. | ||
Sep 30, 2019 | Jun 30, 2019 | ||||||||
Current Period Covenant | Credit Facility, $225M Term Loan and $150M Term Loan | Senior Notes ($100M, $125M, $25M, $75M) | Credit Facility, $225M Term Loan and $150M Term Loan | $100M Senior Notes and $125M Senior Notes | |||||
Maximum Leverage Ratio | less than 60% | 23.2% | 23.2% | 22.1% | 22.1% | ||||
Maximum Secured Leverage Ratio | less than 45% | 1.6% | n/a | 1.7% | n/a | ||||
Maximum Secured Leverage Ratio | less than 40% | n/a | 1.6% | n/a | 1.7% | ||||
Maximum Secured Recourse Debt | less than 15% | —% | —% | —% | —% | ||||
Minimum Tangible Net Worth | $1,815,624 | $2,749,154 | $2,749,154 | $2,614,104 | $2,614,104 | ||||
Minimum Fixed Charge Coverage Ratio | at least 1.50 to 1.00 | 4.3 to 1.00 | 4.3 to 1.00 | 4.9 to 1.00 | 4.9 to 1.00 | ||||
Unencumbered Leverage Ratio | less than 60% | 23.9% | 23.9% | 22.5% | 22.5% | ||||
Unencumbered Interest Coverage Ratio | at least 1.75 to 1.00 | 7.04 to 1.00 | 7.04 to 1.00 | 7.78 to 1.00 | 7.78 to 1.00 |
For the Three Months Ended | |||||||||||||||||||
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | |||||||||||||||
EBITDAre | $ | 44,334 | $ | 41,921 | $ | 39,184 | $ | 36,903 | $ | 35,565 | |||||||||
Amortization of above/below market lease intangibles | (2,065 | ) | (1,900 | ) | (1,751 | ) | (1,627 | ) | (1,622 | ) | |||||||||
Non-cash stock compensation | 2,668 | 2,709 | 2,579 | 2,282 | 2,244 | ||||||||||||||
Straight line corporate office rent expense adjustment | — | — | — | (47 | ) | (43 | ) | ||||||||||||
Straight line rental revenue adjustment | (2,080 | ) | (1,241 | ) | (2,067 | ) | (1,492 | ) | (1,343 | ) | |||||||||
Capitalized payments | (1,064 | ) | (955 | ) | (866 | ) | (1,104 | ) | (1,027 | ) | |||||||||
Recurring capital expenditures | (1,851 | ) | (1,280 | ) | (2,294 | ) | (2,403 | ) | (1,405 | ) | |||||||||
2nd generation tenant improvements and leasing commissions | (1,211 | ) | (1,358 | ) | (1,209 | ) | (1,252 | ) | (966 | ) | |||||||||
Cash flow for fixed charge coverage calculation | 38,731 | 37,896 | 33,576 | 31,260 | 31,403 | ||||||||||||||
Cash interest expense calculation detail: | |||||||||||||||||||
Interest expense | 6,785 | 6,255 | 6,471 | 6,656 | 6,456 | ||||||||||||||
Capitalized interest | 1,311 | 1,053 | 629 | 469 | 650 | ||||||||||||||
Note payable premium amort. | (1 | ) | (2 | ) | (1 | ) | (1 | ) | (1 | ) | |||||||||
Amortization of deferred financing costs | (347 | ) | (345 | ) | (344 | ) | (345 | ) | (344 | ) | |||||||||
Cash interest expense | 7,748 | 6,961 | 6,755 | 6,779 | 6,761 | ||||||||||||||
Scheduled principal payments | 40 | 39 | 39 | 38 | 38 | ||||||||||||||
Preferred stock/unit dividends | 2,842 | 2,694 | 2,423 | 2,424 | 2,423 | ||||||||||||||
Fixed charges | $ | 10,630 | $ | 9,694 | $ | 9,217 | $ | 9,241 | $ | 9,222 | |||||||||
Fixed Charge Coverage Ratio | 3.6 | x | 3.9 | x | 3.6 | x | 3.4 | x | 3.4 | x |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 27 | ||
Notes and Definitions. | ||
Three Months Ended | |||||||||||||||||||
September 30, 2019 | June 30, 2019 | March 31, 2019 | December 31, 2018 | September 30, 2018 | |||||||||||||||
Rental revenue | $ | 56,442 | $ | 53,599 | $ | 50,286 | $ | 47,429 | $ | 45,661 | |||||||||
Tenant reimbursements | 10,193 | 9,776 | 9,041 | 8,462 | 8,508 | ||||||||||||||
Other income | 385 | 238 | 277 | 234 | 300 | ||||||||||||||
Rental income | $ | 67,020 | $ | 63,613 | $ | 59,604 | $ | 56,125 | $ | 54,469 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||
2019 | 2018 | $ Change | % Change | 2019 | 2018 | $ Change | % Change | ||||||||||||||||||||
Rental revenue | $ | 43,158 | $ | 40,841 | $ | 2,317 | 5.7% | $ | 128,534 | $ | 121,479 | $ | 7,055 | 5.8% | |||||||||||||
Tenant reimbursements | 7,588 | 7,608 | (20 | ) | (0.3)% | 22,847 | 22,338 | 509 | 2.3% | ||||||||||||||||||
Other income | 350 | 284 | 66 | 23.2% | 809 | 634 | 175 | 27.6% | |||||||||||||||||||
Rental income | $ | 51,096 | $ | 48,733 | $ | 2,363 | 4.8% | $ | 152,190 | $ | 144,451 | $ | 7,739 | 5.4% |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 28 | ||
Notes and Definitions. | ||
14748-14750 Nelson Avenue | 301-445 Figueroa Street | |
15401 Figueroa Street | 3233 Mission Oaks Boulevard | |
1601 Alton Parkway | 7110 E. Rosecrans Avenue | |
2700-2722 Fairview Street | 28903 Avenue Paine |
Three Months Ended | |||||||||||||||||||
Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | |||||||||||||||
Net Income | $ | 12,948 | $ | 15,954 | $ | 10,717 | $ | 15,207 | $ | 8,965 | |||||||||
Add: | |||||||||||||||||||
General and administrative | 7,440 | 7,301 | 7,344 | 6,297 | 6,229 | ||||||||||||||
Depreciation and amortization | 25,496 | 24,522 | 21,996 | 20,671 | 20,144 | ||||||||||||||
Acquisition expenses | 122 | 29 | 23 | 166 | 106 | ||||||||||||||
Interest expense | 6,785 | 6,255 | 6,471 | 6,656 | 6,456 | ||||||||||||||
Subtract: | |||||||||||||||||||
Management, leasing, and development services | 90 | 109 | 102 | 114 | 116 | ||||||||||||||
Interest income | 951 | 668 | 657 | 769 | 609 | ||||||||||||||
Gains on sale of real estate | 895 | 4,810 | — | 5,631 | — | ||||||||||||||
NOI | $ | 50,855 | $ | 48,474 | $ | 45,792 | $ | 42,483 | $ | 41,175 | |||||||||
Straight line rental revenue adjustment | (2,080 | ) | (1,241 | ) | (2,067 | ) | (1,492 | ) | (1,343 | ) | |||||||||
Amortization of above/below market lease intangibles | (2,065 | ) | (1,900 | ) | (1,751 | ) | (1,627 | ) | (1,622 | ) | |||||||||
Cash NOI | $ | 46,710 | $ | 45,333 | $ | 41,974 | $ | 39,364 | $ | 38,210 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income | $ | 12,948 | $ | 8,965 | $ | 39,619 | $ | 31,868 | |||||||
Add: | |||||||||||||||
General and administrative | 7,440 | 6,229 | 22,085 | 18,897 | |||||||||||
Depreciation and amortization | 25,496 | 20,144 | 72,014 | 59,371 | |||||||||||
Acquisition expenses | 122 | 106 | 174 | 152 | |||||||||||
Interest expense | 6,785 | 6,456 | 19,511 | 18,760 | |||||||||||
Deduct: | |||||||||||||||
Management, leasing and development services | 90 | 116 | 301 | 359 | |||||||||||
Interest income | 951 | 609 | 2,276 | 609 | |||||||||||
Gains on sale of real estate | 895 | — | 5,705 | 11,591 | |||||||||||
NOI | $ | 50,855 | $ | 41,175 | $ | 145,121 | $ | 116,489 | |||||||
Non-Same Property Portfolio rental income | (15,924 | ) | (5,736 | ) | (38,047 | ) | (10,067 | ) | |||||||
Non-Same Property Portfolio property expenses | 3,837 | 1,402 | 9,093 | 2,553 | |||||||||||
Same Property Portfolio NOI | $ | 38,768 | $ | 36,841 | $ | 116,167 | $ | 108,975 | |||||||
Straight line rental revenue adjustment | (708 | ) | (920 | ) | (2,647 | ) | (4,320 | ) | |||||||
Amort. of above/below market lease intangibles | (856 | ) | (1,095 | ) | (2,855 | ) | (3,443 | ) | |||||||
Same Property Portfolio Cash NOI | $ | 37,204 | $ | 34,826 | $ | 110,665 | $ | 101,212 | |||||||
NOI (from above) | $ | 50,855 | $ | 41,175 | $ | 145,121 | $ | 116,489 | |||||||
Non-Stabilized Same Property Portfolio rental income | (19,013 | ) | (7,759 | ) | (47,052 | ) | (15,272 | ) | |||||||
Non-Stabilized Same Property Portfolio property expenses | 4,494 | 1,948 | 11,119 | 4,058 | |||||||||||
Stabilized Same Property Portfolio NOI | $ | 36,336 | $ | 35,364 | $ | 109,188 | $ | 105,275 | |||||||
Straight line rental revenue adjustment | (650 | ) | (792 | ) | (2,132 | ) | (3,908 | ) | |||||||
Amort. of above/below market lease intangibles | (862 | ) | (1,106 | ) | (2,876 | ) | (3,544 | ) | |||||||
Stabilized Same Property Portfolio Cash NOI | $ | 34,824 | $ | 33,466 | $ | 104,180 | $ | 97,823 |
2019 Estimate | |||||||
Low | High | ||||||
Net income attributable to common stockholders | $ | 0.41 | $ | 0.43 | |||
Company share of depreciation and amortization | $ | 0.90 | $ | 0.90 | |||
Company share of gains on sale of real estate | $ | (0.11 | ) | $ | (0.11 | ) | |
Company share of Core FFO | $ | 1.20 | $ | 1.22 |
Third Quarter 2019 Supplemental Financial Reporting Package | Page 29 | ||