(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 | ||
99.2 | ||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Rexford Industrial Realty, Inc. | |
May 4, 2020 | /s/ Michael S. Frankel |
Michael S. Frankel Co-Chief Executive Officer (Principal Executive Officer) | |
Rexford Industrial Realty, Inc. | |
May 4, 2020 | /s/ Howard Schwimmer |
Howard Schwimmer Co-Chief Executive Officer (Principal Executive Officer) |
• | Net income attributable to common stockholders of $0.09 per diluted share compared to $0.08 per diluted share for the first quarter of last year. |
• | Company share of Core FFO increased 27.6% to $37.5 million year-over-year. |
• | Company share of Core FFO per diluted share increased 10.0% to $0.33 per diluted share year-over-year. |
• | Consolidated Portfolio Net Operating Income (NOI) of $59.4 million, an increase of 29.7% year-over-year. |
• | Consolidated Portfolio Cash NOI of $55.3 million, representing an increase of 31.8% year-over-year. |
• | Stabilized Same Property Portfolio GAAP and Cash NOI increased 3.7% and 7.5%, respectively, year-over-year. |
• | Comparable rental rates on 1,594,358 rentable square feet of new and renewal leases were 36.6% higher than prior rents on a GAAP basis and 24.4% higher on a cash basis. |
• | Acquired 10 industrial properties for an aggregate purchase price of $203.2 million. |
• | 701-751 Kingshill Place, a 73% leased six-building industrial complex containing 169,069 square feet on 7.95 acres of land, located in the Los Angeles – South Bay submarket, for $33.0 million, or $195 per square foot. |
• | 2601-2641 Manhattan Beach Boulevard, a 96% leased six-building industrial complex containing 126,726 square feet on 6.58 acres of land, located in the Los Angeles – South Bay submarket, for $38.2 million, or $302 per square foot. |
• | 2410-2420 Santa Fe Avenue, a 100% leased single-tenant industrial building containing 112,000 square feet on 5.57 acres of land, located in the Los Angeles – South Bay submarket, for $34.7 million, or $310 per square foot. |
• | 11600 Los Nietos Road, a 100% leased single-tenant industrial building containing 103,982 square feet on 4.54 acres of land, located in the Mid-Counties submarket, for $16.6 million, or $160 per square foot. |
• | 5160 Richton Street, an 86% leased multi-tenant industrial building containing 94,976 square feet on 4.28 acres of land, located in the Inland Empire – West submarket, for $15.6 million, or $164 per square foot. |
• | 2205 126th Street, a 40% leased multi-tenant industrial building containing 63,532 square feet on 3.56 acres of land, located in the Los Angeles – South Bay submarket, for $17.1 million, or $269 per square foot. |
• | 11832-11954 La Cienega Boulevard, a 93% leased four-building industrial complex containing 63,462 square feet on 3.05 acres of land, located in the Los Angeles – South Bay submarket, for $19.2 million, or $302 per square foot. |
• | 7612-7642 Woodwind Drive, a 100% leased three-building industrial complex containing 62,377 square feet on 4.04 acres of land, located in the Orange County – West submarket, for $13.7 million, or $220 per square foot. |
• | 960-970 Knox Street, a 100% leased two-building industrial complex containing 39,400 square feet on 2.27 acres of land, located in the Los Angeles – South Bay submarket, for $9.6 million, or $244 per square foot. |
• | 25781 Atlantic Ocean Drive, a 100% leased single-tenant industrial building containing 27,960 square feet on 1.65 acres of land, located in the Orange County – South submarket, for $5.5 million, or $196 per square foot. |
▪ | The Company collected March rents from tenants representing approximately 97.9% of ABR. |
▪ | The Company has collected contractual April rents or executed short-term rent relief agreements with tenants representing 95.4% of ABR. |
• | The Company has collected April cash rents from tenants representing 82.1% of ABR. |
• | A number of tenants are exercising their local government-mandated rights to unilaterally defer rent without an agreement. |
• | Additional details regarding these rent relief agreements related to the impact of COVID-19 can be found in the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2020, on the Company’s investor relations website at www.ir.rexfordindustrial.com and via EDGAR through the SEC website at http://www.sec.gov. |
• | Net income attributable to common stockholders within a range of $0.28 to $0.31 per diluted share |
• | Company share of Core FFO within a range of $1.26 to $1.29 per diluted share |
• | Year-end Stabilized Same Property Portfolio occupancy within a range of 95.0% to 96.0% |
• | Stabilized Same Property Portfolio NOI growth for the year within a range of 1.3% to 1.8% |
• | General and administrative expenses within a range of $36.5 million to $37.0 million |
2020 Estimate | |||||||
Low | High | ||||||
Net income attributable to common stockholders | $ | 0.28 | $ | 0.31 | |||
Company share of depreciation and amortization | $ | 0.98 | $ | 0.98 | |||
Company share of Core FFO | $ | 1.26 | $ | 1.29 |
1210 N. Red Gum Street | 16121 Carmenita Road | 3233 Mission Oaks Boulevard | ||
1332-1340 Rocky Point Drive | 1998 Surveyor Avenue | 7110 E. Rosecrans Avenue | ||
14748-14750 Nelson Avenue | 2700-2722 Fairview Street | 851 Lawrence Drive | ||
15401 Figueroa Street | 28903 Avenue Paine | |||
1580 Carson Street | 29003 Avenue Sherman |
March 31, 2020 | December 31, 2019 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
Land | $ | 2,068,460 | $ | 1,927,098 | |||
Buildings and improvements | 1,748,675 | 1,680,178 | |||||
Tenant improvements | 75,341 | 72,179 | |||||
Furniture, fixtures, and equipment | 141 | 141 | |||||
Construction in progress | 26,791 | 18,794 | |||||
Total real estate held for investment | 3,919,408 | 3,698,390 | |||||
Accumulated depreciation | (316,812 | ) | (296,777 | ) | |||
Investments in real estate, net | 3,602,596 | 3,401,613 | |||||
Cash and cash equivalents | 112,432 | 78,857 | |||||
Restricted cash | 46 | — | |||||
Rents and other receivables, net | 5,859 | 5,889 | |||||
Deferred rent receivable, net | 31,339 | 29,671 | |||||
Deferred leasing costs, net | 19,482 | 18,688 | |||||
Deferred loan costs, net | 2,770 | 695 | |||||
Acquired lease intangible assets, net | 76,138 | 73,090 | |||||
Acquired indefinite-lived intangible | 5,156 | 5,156 | |||||
Interest rate swap asset | — | 766 | |||||
Other assets | 10,717 | 9,671 | |||||
Acquisition related deposits | 5,896 | 14,526 | |||||
Total Assets | $ | 3,872,431 | $ | 3,638,622 | |||
LIABILITIES & EQUITY | |||||||
Liabilities | |||||||
Notes payable | $ | 903,802 | $ | 857,842 | |||
Interest rate swap liability | 22,690 | 8,488 | |||||
Accounts payable, accrued expenses and other liabilities | 39,000 | 31,112 | |||||
Dividends payable | 25,931 | 21,624 | |||||
Acquired lease intangible liabilities, net | 63,914 | 59,340 | |||||
Tenant security deposits | 30,342 | 28,779 | |||||
Prepaid rents | 8,074 | 8,988 | |||||
Total Liabilities | 1,093,753 | 1,016,173 | |||||
Equity | |||||||
Rexford Industrial Realty, Inc. stockholders’ equity | |||||||
Preferred stock, $0.01 par value per share, 10,050,000 shares authorized, at March 31, 2020 and December 31, 2019 | |||||||
5.875% series A cumulative redeemable preferred stock, 3,600,000 shares outstanding at March 31, 2020 and December 31, 2019 ($90,000 liquidation preference) | 86,651 | 86,651 | |||||
5.875% series B cumulative redeemable preferred stock, 3,000,000 shares outstanding at March 31, 2020 and December 31, 2019 ($75,000 liquidation preference) | 72,443 | 72,443 | |||||
5.625% series C cumulative redeemable preferred stock, 3,450,000 shares outstanding at March 31, 2020 and December 31, 2019 ($86,250 liquidation preference) | 83,233 | 83,233 | |||||
Common Stock, $0.01 par value per share, 489,950,000 authorized and 116,331,347 and 113,793,300 shares outstanding at March 31, 2020 and December 31, 2019, respectively | 1,162 | 1,136 | |||||
Additional paid in capital | 2,524,274 | 2,439,007 | |||||
Cumulative distributions in excess of earnings | (132,843 | ) | (118,751 | ) | |||
Accumulated other comprehensive income | (21,950 | ) | (7,542 | ) | |||
Total stockholders’ equity | 2,612,970 | 2,556,177 | |||||
Noncontrolling interests | 165,708 | 66,272 | |||||
Total Equity | 2,778,678 | 2,622,449 | |||||
Total Liabilities and Equity | $ | 3,872,431 | $ | 3,638,622 |
Three Months Ended March 31, | |||||||
2020 | 2019 | ||||||
REVENUES | |||||||
Rental income | 77,490 | 59,604 | |||||
Management, leasing and development services | 93 | 102 | |||||
Interest income | 97 | 657 | |||||
TOTAL REVENUES | 77,680 | 60,363 | |||||
OPERATING EXPENSES | |||||||
Property expenses | 18,114 | 13,812 | |||||
General and administrative | 9,317 | 7,344 | |||||
Depreciation and amortization | 27,523 | 21,996 | |||||
TOTAL OPERATING EXPENSES | 54,954 | 43,152 | |||||
OTHER EXPENSES | |||||||
Acquisition expenses | 5 | 23 | |||||
Interest expense | 7,449 | 6,471 | |||||
TOTAL EXPENSES | 62,408 | 49,646 | |||||
NET INCOME | 15,272 | 10,717 | |||||
Less: net income attributable to noncontrolling interest | (717 | ) | (201 | ) | |||
NET INCOME ATTRIBUTABLE TO REXFORD INDUSTRIAL REALTY, INC. | 14,555 | 10,516 | |||||
Less: preferred stock dividends | (3,636 | ) | (2,423 | ) | |||
Less: earnings attributable to participating securities | (131 | ) | (114 | ) | |||
NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 10,788 | $ | 7,979 | |||
Net income attributable to common stockholders per share – basic | $ | 0.09 | $ | 0.08 | |||
Net income attributable to common stockholders per share – diluted | $ | 0.09 | $ | 0.08 | |||
Weighted-average shares of common stock outstanding – basic | 114,054 | 98,343 | |||||
Weighted-average shares of common stock outstanding – diluted | 114,314 | 98,608 |
Stabilized Same Property Portfolio Occupancy: | |||||
March 31, | |||||
2020 | 2019 | Change (basis points) | |||
Occupancy: | |||||
Los Angeles County | 99.1% | 98.7% | 40 bps | ||
Orange County | 99.3% | 97.6% | 170 bps | ||
San Bernardino County | 97.2% | 97.4% | (20) bps | ||
San Diego County | 94.0% | 97.2% | (320) bps | ||
Ventura County | 95.7% | 97.1% | (140) bps | ||
Total/Weighted Average | 98.0% | 98.1% | (10) bps |
Stabilized Same Property Portfolio NOI and Cash NOI | |||||||||||||
Three Months Ended March 31, | |||||||||||||
2020 | 2019 | $ Change | % Change | ||||||||||
Rental income | $ | 57,778 | $ | 55,693 | $ | 2,085 | 3.7% | ||||||
Property expenses | 13,139 | 12,639 | 500 | 4.0% | |||||||||
Stabilized Same Property Portfolio NOI | $ | 44,639 | $ | 43,054 | $ | 1,585 | 3.7% | ||||||
Straight line rental revenue adjustment | (645 | ) | (1,735 | ) | 1,090 | (62.8)% | |||||||
Amortization of above/below market lease intangibles | (1,489 | ) | (1,764 | ) | 275 | (15.6)% | |||||||
Stabilized Same Property Portfolio Cash NOI | $ | 42,505 | $ | 39,555 | $ | 2,950 | 7.5% |
Three Months Ended March 31, | |||||||
2020 | 2019 | ||||||
Net income | $ | 15,272 | $ | 10,717 | |||
Add: | |||||||
General and administrative | 9,317 | 7,344 | |||||
Depreciation and amortization | 27,523 | 21,996 | |||||
Acquisition expenses | 5 | 23 | |||||
Interest expense | 7,449 | 6,471 | |||||
Deduct: | |||||||
Management, leasing and development services | 93 | 102 | |||||
Interest income | 97 | 657 | |||||
Net operating income (NOI) | $ | 59,376 | $ | 45,792 | |||
Non-Stabilized Same Property Portfolio rental income | (19,712 | ) | (3,911 | ) | |||
Non-Stabilized Same Property Portfolio property expenses | 4,975 | 1,173 | |||||
Stabilized Same Property Portfolio NOI | $ | 44,639 | $ | 43,054 | |||
Straight line rental revenue adjustment | (645 | ) | (1,735 | ) | |||
Amortization of above/below market lease intangibles | (1,489 | ) | (1,764 | ) | |||
Stabilized Same Property Portfolio Cash NOI | $ | 42,505 | $ | 39,555 |
Three Months Ended March 31, | |||||||
2020 | 2019 | ||||||
Net income | $ | 15,272 | $ | 10,717 | |||
Add: | |||||||
Depreciation and amortization | 27,523 | 21,996 | |||||
Funds From Operations (FFO) | $ | 42,795 | $ | 32,713 | |||
Less: preferred stock dividends | (3,636 | ) | (2,423 | ) | |||
Less: FFO attributable to noncontrolling interest(1) | (1,450 | ) | (733 | ) | |||
Less: FFO attributable to participating securities(2) | (195 | ) | (176 | ) | |||
Company share of FFO | $ | 37,514 | $ | 29,381 | |||
Company Share of FFO per common share – basic | $ | 0.33 | $ | 0.30 | |||
Company Share of FFO per common share – diluted | $ | 0.33 | $ | 0.30 | |||
FFO | $ | 42,795 | $ | 32,713 | |||
Adjust: | |||||||
Acquisition expenses | 5 | 23 | |||||
Core FFO | $ | 42,800 | $ | 32,736 | |||
Less: preferred stock dividends | (3,636 | ) | (2,423 | ) | |||
Less: Core FFO attributable to noncontrolling interest(1) | (1,450 | ) | (733 | ) | |||
Less: Core FFO attributable to participating securities(2) | (195 | ) | (176 | ) | |||
Company share of Core FFO | $ | 37,519 | $ | 29,404 | |||
Company share of Core FFO per common share – basic | $ | 0.33 | $ | 0.30 | |||
Company share of Core FFO per common share – diluted | $ | 0.33 | $ | 0.30 | |||
Weighted-average shares of common stock outstanding – basic | 114,054 | 98,343 | |||||
Weighted-average shares of common stock outstanding – diluted | 114,314 | 98,608 |
(1) | Noncontrolling interests relate to interests in the Company’s operating partnership, represented by common units and preferred units (Series 1 & 2 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 |
Stabilized Same Property Portfolio Performance | 11 |
Capitalization Summary | 12 |
Debt Summary | 13-14 |
Portfolio Data: | |
Portfolio Overview | 15 |
Occupancy and Leasing Trends | 16 |
Leasing Statistics | 17-18 |
Top Tenants and Lease Segmentation | 19 |
Capital Expenditure Summary | 20 |
Properties and Space Under Repositioning/Development | 21-22 |
Current Year Acquisitions and Dispositions Summary | 23 |
Guidance | 24 |
Net Asset Value Components | 25 |
Notes and Definitions | 26-29 |
First Quarter 2020 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 |
First Quarter 2020 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 | |||||||||||||||||||
March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | March 31, 2019 | |||||||||||||||
Financial Results: | |||||||||||||||||||
Total rental income | $ | 77,490 | $ | 74,015 | $ | 67,020 | $ | 63,613 | $ | 59,604 | |||||||||
Net income | $ | 15,272 | $ | 24,382 | $ | 12,948 | $ | 15,954 | $ | 10,717 | |||||||||
Net Operating Income (NOI) | $ | 59,376 | $ | 55,859 | $ | 50,855 | $ | 48,474 | $ | 45,792 | |||||||||
Company share of Core FFO | $ | 37,519 | $ | 35,754 | $ | 33,853 | $ | 32,068 | $ | 29,404 | |||||||||
Company share of Core FFO per common share - diluted | $ | 0.33 | $ | 0.32 | $ | 0.31 | $ | 0.30 | $ | 0.30 | |||||||||
Adjusted EBITDA | $ | 55,566 | $ | 52,232 | $ | 49,271 | $ | 45,342 | $ | 42,164 | |||||||||
Dividend declared per common share | $ | 0.215 | $ | 0.185 | $ | 0.185 | $ | 0.185 | $ | 0.185 | |||||||||
Portfolio Statistics: | |||||||||||||||||||
Portfolio rentable square feet (“RSF”) - consolidated | 27,429,136 | 26,551,084 | 24,814,281 | 23,874,494 | 22,144,631 | ||||||||||||||
Ending occupancy - consolidated portfolio | 95.2 | % | 96.1 | % | 94.9 | % | 94.2 | % | 94.6 | % | |||||||||
Stabilized occupancy - consolidated portfolio | 97.4 | % | 97.9 | % | 97.5 | % | 97.8 | % | 97.8 | % | |||||||||
Leasing spreads - GAAP | 36.6 | % | 42.0 | % | 31.2 | % | 39.4 | % | 26.2 | % | |||||||||
Leasing spreads - cash | 24.4 | % | 27.1 | % | 19.4 | % | 22.3 | % | 17.3 | % | |||||||||
Stabilized Same Property Performance: | |||||||||||||||||||
Stabilized Same Property Portfolio RSF | 19,831,139 | 19,831,139 | 18,134,752 | 18,134,752 | 18,134,752 | ||||||||||||||
Stabilized Same Property Portfolio ending occupancy | 98.0 | % | 98.0 | % | 97.7 | % | 98.0 | % | 98.1 | % | |||||||||
Stabilized Same Property Portfolio NOI growth(2) | 3.7 | % | n/a | n/a | n/a | n/a | |||||||||||||
Stabilized Same Property Portfolio Cash NOI growth(2) | 7.5 | % | n/a | n/a | n/a | n/a | |||||||||||||
Capitalization: | |||||||||||||||||||
Common stock price at quarter end | $ | 41.01 | $ | 45.67 | $ | 44.02 | $ | 40.37 | $ | 35.81 | |||||||||
Common shares issued and outstanding | 116,087,092 | 113,580,755 | 110,669,277 | 109,519,791 | 103,804,570 | ||||||||||||||
Total shares and units issued and outstanding at period end(3) | 120,004,376 | 116,304,528 | 113,091,134 | 111,943,020 | 106,267,799 | ||||||||||||||
Weighted average shares outstanding - diluted | 114,314,331 | 112,096,619 | 110,074,074 | 106,236,309 | 98,607,786 | ||||||||||||||
Series A, B and C Preferred Stock and Series 1 and 2 CPOP Units | $ | 319,068 | $ | 278,281 | $ | 278,281 | $ | 192,031 | $ | 165,000 | |||||||||
Total equity market capitalization | $ | 5,240,447 | $ | 5,589,909 | $ | 5,256,553 | $ | 4,711,171 | $ | 3,970,450 | |||||||||
Total consolidated debt | $ | 905,645 | $ | 860,958 | $ | 860,999 | $ | 761,038 | $ | 761,077 | |||||||||
Total combined market capitalization (net debt plus equity) | $ | 6,033,660 | $ | 6,372,010 | $ | 5,920,044 | $ | 5,300,000 | $ | 4,454,952 | |||||||||
Ratios: | |||||||||||||||||||
Net debt to total combined market capitalization | 13.1 | % | 12.3 | % | 11.2 | % | 11.1 | % | 10.9 | % | |||||||||
Net debt to Adjusted EBITDA (quarterly results annualized) | 3.6x | 3.7x | 3.4x | 3.2x | 2.9x |
(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 Stabilized Same Property Portfolio. |
(3) | Includes the following number of OP Units and vested LTIP units held by noncontrolling interests: 3,917,284 (Mar 31, 2020), 2,723,773 (Dec 31, 2019), 2,421,857 (Sep 30, 2019), 2,423,229 (Jun 30, 2019) and 2,463,229 (Mar 31, 2019). Excludes the following number of shares of unvested restricted stock: 244,255 (Mar 31, 2020), 212,545 (Dec 31, 2019), 214,995 (Sep 30, 2019), 219,789 (Jun 30, 2019) and 223,476 (Mar 31, 2019). Excludes unvested LTIP units and unvested performance units. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 4 | ||
Consolidated Balance Sheets. | ||
(unaudited and in thousands) |
March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | March 31, 2019 | |||||||||||||||
ASSETS | |||||||||||||||||||
Land | $ | 2,068,460 | $ | 1,927,098 | $ | 1,728,490 | $ | 1,590,321 | $ | 1,364,738 | |||||||||
Buildings and improvements | 1,748,675 | 1,680,178 | 1,611,060 | 1,528,750 | 1,422,684 | ||||||||||||||
Tenant improvements | 75,341 | 72,179 | 68,124 | 66,665 | 62,908 | ||||||||||||||
Furniture, fixtures, and equipment | 141 | 141 | 141 | 141 | 149 | ||||||||||||||
Construction in progress | 26,791 | 18,794 | 29,094 | 23,576 | 20,331 | ||||||||||||||
Total real estate held for investment | 3,919,408 | 3,698,390 | 3,436,909 | 3,209,453 | 2,870,810 | ||||||||||||||
Accumulated depreciation | (316,812 | ) | (296,777 | ) | (278,726 | ) | (261,231 | ) | (245,033 | ) | |||||||||
Investments in real estate, net | 3,602,596 | 3,401,613 | 3,158,183 | 2,948,222 | 2,625,777 | ||||||||||||||
Cash and cash equivalents | 112,432 | 78,857 | 197,508 | 172,209 | 276,575 | ||||||||||||||
Restricted cash | 46 | — | — | 11,055 | — | ||||||||||||||
Rents and other receivables, net | 5,859 | 5,889 | 4,376 | 3,614 | 4,548 | ||||||||||||||
Deferred rent receivable, net | 31,339 | 29,671 | 27,502 | 25,462 | 24,290 | ||||||||||||||
Deferred leasing costs, net | 19,482 | 18,688 | 17,561 | 16,722 | 14,139 | ||||||||||||||
Deferred loan costs, net | 2,770 | 695 | 849 | 1,004 | 1,158 | ||||||||||||||
Acquired lease intangible assets, net(1) | 76,138 | 73,090 | 67,110 | 61,664 | 56,122 | ||||||||||||||
Acquired indefinite-lived intangible | 5,156 | 5,156 | 5,156 | 5,156 | 5,156 | ||||||||||||||
Interest rate swap asset | — | 766 | 374 | 1,414 | 5,896 | ||||||||||||||
Other assets | 10,717 | 9,671 | 10,778 | 14,204 | 12,580 | ||||||||||||||
Acquisition related deposits | 5,896 | 14,526 | 8,415 | 4,615 | 10,875 | ||||||||||||||
Assets associated with real estate held for sale, net(2) | — | — | 4,582 | — | — | ||||||||||||||
Total Assets | $ | 3,872,431 | $ | 3,638,622 | $ | 3,502,394 | $ | 3,265,341 | $ | 3,037,116 | |||||||||
LIABILITIES & EQUITY | |||||||||||||||||||
Liabilities | |||||||||||||||||||
Notes payable | $ | 903,802 | $ | 857,842 | $ | 857,688 | $ | 757,677 | $ | 757,524 | |||||||||
Interest rate swap liability | 22,690 | 8,488 | 10,727 | 8,671 | 4,604 | ||||||||||||||
Accounts payable, accrued expenses and other liabilities | 39,000 | 31,112 | 34,669 | 26,065 | 33,728 | ||||||||||||||
Dividends payable | 25,931 | 21,624 | 21,034 | 20,823 | 19,774 | ||||||||||||||
Acquired lease intangible liabilities, net(3) | 63,914 | 59,340 | 56,151 | 55,084 | 52,426 | ||||||||||||||
Tenant security deposits | 30,342 | 28,779 | 27,688 | 26,123 | 24,396 | ||||||||||||||
Prepaid rents | 8,074 | 8,988 | 7,759 | 6,289 | 6,828 | ||||||||||||||
Liabilities associated with real estate held for sale(2) | — | — | 135 | — | — | ||||||||||||||
Total Liabilities | 1,093,753 | 1,016,173 | 1,015,851 | 900,732 | 899,280 | ||||||||||||||
Equity | |||||||||||||||||||
Preferred stock | 242,327 | 242,327 | 242,529 | 159,094 | 159,094 | ||||||||||||||
Common stock | 1,162 | 1,136 | 1,106 | 1,095 | 1,038 | ||||||||||||||
Additional paid in capital | 2,524,274 | 2,439,007 | 2,306,282 | 2,255,849 | 2,042,218 | ||||||||||||||
Cumulative distributions in excess of earnings | (132,843 | ) | (118,751 | ) | (117,711 | ) | (107,056 | ) | (99,715 | ) | |||||||||
Accumulated other comprehensive income | (21,950 | ) | (7,542 | ) | (10,132 | ) | (7,101 | ) | 1,261 | ||||||||||
Total stockholders’ equity | 2,612,970 | 2,556,177 | 2,422,074 | 2,301,881 | 2,103,896 | ||||||||||||||
Noncontrolling interests | 165,708 | 66,272 | 64,469 | 62,728 | 33,940 | ||||||||||||||
Total Equity | 2,778,678 | 2,622,449 | 2,486,543 | 2,364,609 | 2,137,836 | ||||||||||||||
Total Liabilities and Equity | $ | 3,872,431 | $ | 3,638,622 | $ | 3,502,394 | $ | 3,265,341 | $ | 3,037,116 |
(1) | Includes net above-market tenant lease intangibles of $6,675 (March 31, 2020), $6,675 (December 31, 2019), $5,517 (September 30, 2019), $5,450 (June 30, 2019) and $5,410 (March 31, 2019). |
(2) | At September 30, 2019, our property located at 13914-13932 East Valley Boulevard was classified as held for sale. |
(3) | Represents net below-market tenant lease intangibles as of the balance sheet date. |
First Quarter 2020 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 | |||||||||||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||||||||||
Revenues | |||||||||||||||||||
Rental income(1) | $ | 77,490 | $ | 74,015 | $ | 67,020 | $ | 63,613 | $ | 59,604 | |||||||||
Management, leasing, and development services | 93 | 105 | 90 | 109 | 102 | ||||||||||||||
Interest income | 97 | 279 | 951 | 668 | 657 | ||||||||||||||
Total Revenues | 77,680 | 74,399 | 68,061 | 64,390 | 60,363 | ||||||||||||||
Operating Expenses | |||||||||||||||||||
Property expenses | 18,114 | 18,156 | 16,165 | 15,139 | 13,812 | ||||||||||||||
General and administrative | 9,317 | 8,215 | 7,440 | 7,301 | 7,344 | ||||||||||||||
Depreciation and amortization | 27,523 | 26,877 | 25,496 | 24,522 | 21,996 | ||||||||||||||
Total Operating Expenses | 54,954 | 53,248 | 49,101 | 46,962 | 43,152 | ||||||||||||||
Other Expenses | |||||||||||||||||||
Acquisition expenses | 5 | (3 | ) | 122 | 29 | 23 | |||||||||||||
Interest expense | 7,449 | 7,364 | 6,785 | 6,255 | 6,471 | ||||||||||||||
Total Expenses | 62,408 | 60,609 | 56,008 | 53,246 | 49,646 | ||||||||||||||
Gains on sale of real estate | — | 10,592 | 895 | 4,810 | — | ||||||||||||||
Net Income | 15,272 | 24,382 | 12,948 | 15,954 | 10,717 | ||||||||||||||
Less: net income attributable to noncontrolling interests | (717 | ) | (734 | ) | (518 | ) | (569 | ) | (201 | ) | |||||||||
Net income attributable to Rexford Industrial Realty, Inc. | 14,555 | 23,648 | 12,430 | 15,385 | 10,516 | ||||||||||||||
Less: preferred stock dividends | (3,636 | ) | (3,636 | ) | (2,572 | ) | (2,424 | ) | (2,423 | ) | |||||||||
Less: earnings allocated to participating securities | (131 | ) | (108 | ) | (112 | ) | (113 | ) | (114 | ) | |||||||||
Net income attributable to common stockholders | $ | 10,788 | $ | 19,904 | $ | 9,746 | $ | 12,848 | $ | 7,979 | |||||||||
Earnings per Common Share | |||||||||||||||||||
Net income attributable to common stockholders per share - basic | $ | 0.09 | $ | 0.18 | $ | 0.09 | $ | 0.12 | $ | 0.08 | |||||||||
Net income attributable to common stockholders per share - diluted | $ | 0.09 | $ | 0.18 | $ | 0.09 | $ | 0.12 | $ | 0.08 | |||||||||
Weighted average shares outstanding - basic | 114,054,434 | 111,612,279 | 109,645,216 | 105,847,557 | 98,342,677 | ||||||||||||||
Weighted average shares outstanding - diluted | 114,314,331 | 112,096,619 | 110,074,074 | 106,236,309 | 98,607,786 |
(1) | 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. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 6 | ||
Consolidated Statements of Operations. | ||
Quarterly Results | (unaudited and in thousands) |
Three Months Ended March 31, | |||||||
2020 | 2019 | ||||||
Revenues | |||||||
Rental income(1) | $ | 77,490 | $ | 59,604 | |||
Management, leasing, and development services | 93 | 102 | |||||
Interest income | 97 | 657 | |||||
Total Revenues | 77,680 | 60,363 | |||||
Operating Expenses | |||||||
Property expenses | 18,114 | 13,812 | |||||
General and administrative | 9,317 | 7,344 | |||||
Depreciation and amortization | 27,523 | 21,996 | |||||
Total Operating Expenses | 54,954 | 43,152 | |||||
Other Expenses | |||||||
Acquisition expenses | 5 | 23 | |||||
Interest expense | 7,449 | 6,471 | |||||
Total Expenses | 62,408 | 49,646 | |||||
Gains on sale of real estate | — | — | |||||
Net Income | 15,272 | 10,717 | |||||
Less: net income attributable to noncontrolling interests | (717 | ) | (201 | ) | |||
Net income attributable to Rexford Industrial Realty, Inc. | 14,555 | 10,516 | |||||
Less: preferred stock dividends | (3,636 | ) | (2,423 | ) | |||
Less: earnings allocated to participating securities | (131 | ) | (114 | ) | |||
Net income attributable to common stockholders | $ | 10,788 | $ | 7,979 |
(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, is reflected as one line, “Rental income,” in the 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. 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. |
First Quarter 2020 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 | |||||||||||||||||||
March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | March 31, 2019 | |||||||||||||||
Net Income | $ | 15,272 | $ | 24,382 | $ | 12,948 | $ | 15,954 | $ | 10,717 | |||||||||
Add: | |||||||||||||||||||
Depreciation and amortization | 27,523 | 26,877 | 25,496 | 24,522 | 21,996 | ||||||||||||||
Deduct: | |||||||||||||||||||
Gains on sale of real estate | — | 10,592 | 895 | 4,810 | — | ||||||||||||||
Funds From Operations (FFO) | 42,795 | 40,667 | 37,549 | 35,666 | 32,713 | ||||||||||||||
Less: preferred stock dividends | (3,636 | ) | (3,636 | ) | (2,572 | ) | (2,424 | ) | (2,423 | ) | |||||||||
Less: FFO attributable to noncontrolling interests(2) | (1,450 | ) | (1,087 | ) | (1,056 | ) | (1,021 | ) | (733 | ) | |||||||||
Less: FFO attributable to participating securities(3) | (195 | ) | (188 | ) | (187 | ) | (182 | ) | (176 | ) | |||||||||
Company share of FFO | $ | 37,514 | $ | 35,756 | $ | 33,734 | $ | 32,039 | $ | 29,381 | |||||||||
Company share of FFO per common share‐basic | $ | 0.33 | $ | 0.32 | $ | 0.31 | $ | 0.30 | $ | 0.30 | |||||||||
Company share of FFO per common share‐diluted | $ | 0.33 | $ | 0.32 | $ | 0.31 | $ | 0.30 | $ | 0.30 | |||||||||
FFO | $ | 42,795 | $ | 40,667 | $ | 37,549 | $ | 35,666 | $ | 32,713 | |||||||||
Add: | |||||||||||||||||||
Acquisition expenses | 5 | (3 | ) | 122 | 29 | 23 | |||||||||||||
Core FFO | 42,800 | 40,664 | 37,671 | 35,695 | 32,736 | ||||||||||||||
Less: preferred stock dividends | (3,636 | ) | (3,636 | ) | (2,572 | ) | (2,424 | ) | (2,423 | ) | |||||||||
Less: Core FFO attributable to noncontrolling interests(2) | (1,450 | ) | (1,086 | ) | (1,059 | ) | (1,021 | ) | (733 | ) | |||||||||
Less: Core FFO attributable to participating securities(3) | (195 | ) | (188 | ) | (187 | ) | (182 | ) | (176 | ) | |||||||||
Company share of Core FFO | $ | 37,519 | $ | 35,754 | $ | 33,853 | $ | 32,068 | $ | 29,404 | |||||||||
Company share of Core FFO per common share‐basic | $ | 0.33 | $ | 0.32 | $ | 0.31 | $ | 0.30 | $ | 0.30 | |||||||||
Company share of Core FFO per common share‐diluted | $ | 0.33 | $ | 0.32 | $ | 0.31 | $ | 0.30 | $ | 0.30 | |||||||||
Weighted-average shares outstanding-basic | 114,054,434 | 111,612,279 | 109,645,216 | 105,847,557 | 98,342,677 | ||||||||||||||
Weighted-average shares outstanding-diluted(4) | 114,314,331 | 112,096,619 | 110,074,074 | 106,236,309 | 98,607,786 |
(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 & Series 2 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. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 8 | ||
Non-GAAP AFFO Reconciliation. (1) | ||
(unaudited and in thousands, except share and per share data) |
Three Months Ended | |||||||||||||||||||
March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | March 31, 2019 | |||||||||||||||
Funds From Operations(2) | $ | 42,795 | $ | 40,667 | $ | 37,549 | $ | 35,666 | $ | 32,713 | |||||||||
Add: | |||||||||||||||||||
Amortization of deferred financing costs | 343 | 347 | 347 | 345 | 344 | ||||||||||||||
Non-cash stock compensation | 3,570 | 2,800 | 2,668 | 2,709 | 2,579 | ||||||||||||||
Deduct: | |||||||||||||||||||
Preferred stock dividends | 3,636 | 3,636 | 2,572 | 2,424 | 2,423 | ||||||||||||||
Straight line rental revenue adjustment(3) | 1,672 | 2,200 | 2,080 | 1,241 | 2,067 | ||||||||||||||
Amortization of net below-market lease intangibles | 2,402 | 2,191 | 2,065 | 1,900 | 1,751 | ||||||||||||||
Capitalized payments(4) | 2,067 | 1,851 | 2,375 | 2,008 | 1,495 | ||||||||||||||
Note payable premium amortization | 16 | (2 | ) | (1 | ) | (2 | ) | (1 | ) | ||||||||||
Recurring capital expenditures(5) | 1,575 | 1,383 | 1,851 | 1,280 | 2,294 | ||||||||||||||
2nd generation tenant improvements and leasing commissions(6) | 1,727 | 1,754 | 1,211 | 1,358 | 1,209 | ||||||||||||||
Adjusted Funds From Operations (AFFO) | $ | 33,613 | $ | 30,801 | $ | 28,411 | $ | 28,511 | $ | 24,398 |
(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 $1,329, $1,285, $1,057, $916 and $1,399 for the three months ended March 31, 2020, December 31, 2019, September 30, 2019, June 30, 2019, and March 31, 2019, respectively. |
(4) | Includes capitalized interest, taxes, insurance and construction related compensation costs. |
(5) | Excludes nonrecurring capital expenditures of $12,411, $10,857, $8,816, $6,672 and $7,779 for the three months ended March 31, 2020, December 31, 2019, September 30, 2019, June 30, 2019, and March 31, 2019, respectively. |
(6) | Excludes 1st generation tenant improvements/space preparation and leasing commissions of $831, $1,497, $1,164, $2,791 and $282 for the three months ended March 31, 2020, December 31, 2019, September 30, 2019, June 30, 2019, and March 31, 2019, respectively. |
First Quarter 2020 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 | |||||||||||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||||||||||
Rental income(2) | $ | 77,490 | $ | 74,015 | $ | 67,020 | $ | 63,613 | $ | 59,604 | |||||||||
Property expenses | 18,114 | 18,156 | 16,165 | 15,139 | 13,812 | ||||||||||||||
Net Operating Income (NOI) | $ | 59,376 | $ | 55,859 | $ | 50,855 | $ | 48,474 | $ | 45,792 | |||||||||
Amortization of above/below market lease intangibles | (2,402 | ) | (2,191 | ) | (2,065 | ) | (1,900 | ) | (1,751 | ) | |||||||||
Straight line rental revenue adjustment | (1,672 | ) | (2,200 | ) | (2,080 | ) | (1,241 | ) | (2,067 | ) | |||||||||
Cash NOI | $ | 55,302 | $ | 51,468 | $ | 46,710 | $ | 45,333 | $ | 41,974 |
EBITDAre and Adjusted EBITDA | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||||||||||
Net income | $ | 15,272 | $ | 24,382 | $ | 12,948 | $ | 15,954 | $ | 10,717 | |||||||||
Interest expense | 7,449 | 7,364 | 6,785 | 6,255 | 6,471 | ||||||||||||||
Depreciation and amortization | 27,523 | 26,877 | 25,496 | 24,522 | 21,996 | ||||||||||||||
Gains on sale of real estate | — | (10,592 | ) | (895 | ) | (4,810 | ) | — | |||||||||||
EBITDAre | $ | 50,244 | $ | 48,031 | $ | 44,334 | $ | 41,921 | $ | 39,184 | |||||||||
Stock-based compensation amortization | 3,570 | 2,800 | 2,668 | 2,709 | 2,579 | ||||||||||||||
Acquisition expenses | 5 | (3 | ) | 122 | 29 | 23 | |||||||||||||
Pro forma effect of acquisitions(3) | 1,747 | 1,500 | 2,142 | 822 | 378 | ||||||||||||||
Pro forma effect of dispositions(4) | — | (96 | ) | 5 | (139 | ) | — | ||||||||||||
Adjusted EBITDA | $ | 55,566 | $ | 52,232 | $ | 49,271 | $ | 45,342 | $ | 42,164 |
(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 Q1'20 EBITDAre of Q1'20 acquisitions as if they had been acquired on January 1, 2020, the impact on Q4'19 EBITDAre of Q4'19 acquisitions as if they had been acquired on October 1, 2019, the 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, and the impact on Q1'19 EBITDAre of Q1'19 acquisitions as if they had been acquired on January 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 EBITDAre had we owned the acquired entities as of the beginning of each period. |
(4) | Represents the impact on Q4'19 EBITDAre of Q4'19 dispositions as if they had been sold as of October 1, 2019, Q3'19 EBITDAre of Q3'19 dispositions as if they had been sold as of July 1, 2019, and the impact on Q2'19 EBITDAre of Q2'19 dispositions as if they had been sold as of April 1, 2019. We did not sell any properties during Q1'20 or Q1'19. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 10 | ||
Stabilized Same Property Portfolio Performance. (1) | ||
(unaudited and dollars in thousands) |
Stabilized Same Property Portfolio: | ||||||||||||||||
Number of properties | 161 | |||||||||||||||
Square Feet | 19,831,139 |
Stabilized Same Property Portfolio NOI and Cash NOI: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2020 | 2019 | $ Change | % Change | |||||||||||
Rental income(2)(3) | $ | 57,778 | $ | 55,693 | $ | 2,085 | 3.7% | |||||||
Property expenses | 13,139 | 12,639 | 500 | 4.0% | ||||||||||
Stabilized same property portfolio NOI(4) | $ | 44,639 | $ | 43,054 | $ | 1,585 | 3.7% | (3) | ||||||
Straight-line rents | (645 | ) | (1,735 | ) | 1,090 | (62.8)% | ||||||||
Amort. above/below market leases | (1,489 | ) | (1,764 | ) | 275 | (15.6)% | ||||||||
Stabilized same property portfolio Cash NOI(4) | $ | 42,505 | $ | 39,555 | $ | 2,950 | 7.5% | (3) |
Stabilized Same Property Portfolio Occupancy: | ||||||
March 31, | ||||||
Occupancy: | 2020 | 2019 | Change (basis points) | |||
Los Angeles County | 99.1% | 98.7% | 40 bps | |||
Orange County | 99.3% | 97.6% | 170 bps | |||
San Bernardino County | 97.2% | 97.4% | (20) bps | |||
Ventura County | 95.7% | 97.1% | (140) bps | |||
San Diego County | 94.0% | 97.2% | (320) bps | |||
Total/Weighted Average | 98.0% | 98.1% | (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 “Stabilized Same Property Portfolio Rental Income” on page 29 of the definitions section of this report for a breakdown of rental income into rental revenues, tenant reimbursement and other income for the three months ended March 31, 2020 and 2019. |
(3) | Rental income includes lease termination fees of $120 thousand and zero for the three months ended March 31, 2020 and 2019, respectively. Excluding these lease termination fees, Stabilized Same Property Portfolio NOI increased by approximately 3.4% and Stabilized Same Property Portfolio Cash NOI increased by approximately 7.2% during the three months ended March 31, 2020, compared to the three months ended March 31, 2019, respectively. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 11 | ||
Capitalization Summary. | ||
(unaudited and in thousands, except share and per share data) | ||
Capitalization as of March 31, 2020 |
Description | March 31, 2020 | December 31, 2019 | September 30, 2019 | June 30, 2019 | March 31, 2019 | |||||||||||||||
Common shares outstanding(1) | 116,087,092 | 113,580,755 | 110,669,277 | 109,519,791 | 103,804,570 | |||||||||||||||
Operating partnership units outstanding(2) | 3,917,284 | 2,723,773 | 2,421,857 | 2,423,229 | 2,463,229 | |||||||||||||||
Total shares and units outstanding at period end | 120,004,376 | 116,304,528 | 113,091,134 | 111,943,020 | 106,267,799 | |||||||||||||||
Share price at end of quarter | $ | 41.01 | $ | 45.67 | $ | 44.02 | $ | 40.37 | $ | 35.81 | ||||||||||
Common Stock and Operating Partnership Units - Capitalization | $ | 4,921,379 | $ | 5,311,628 | $ | 4,978,272 | $ | 4,519,140 | $ | 3,805,450 | ||||||||||
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 | 86,250 | 86,250 | — | — | |||||||||||||||
4.43937% Series 1 Cumulative Redeemable Convertible Preferred Units(4) | 27,031 | 27,031 | 27,031 | 27,031 | — | |||||||||||||||
4.00% Series 2 Cumulative Redeemable Convertible Preferred Units(4) | 40,787 | — | — | — | — | |||||||||||||||
Total Equity Market Capitalization | $ | 5,240,447 | $ | 5,589,909 | $ | 5,256,553 | $ | 4,711,171 | $ | 3,970,450 | ||||||||||
Total Debt | $ | 905,645 | $ | 860,958 | $ | 860,999 | $ | 761,038 | $ | 761,077 | ||||||||||
Less: Cash and cash equivalents | (112,432 | ) | (78,857 | ) | (197,508 | ) | (172,209 | ) | (276,575 | ) | ||||||||||
Net Debt | $ | 793,213 | $ | 782,101 | $ | 663,491 | $ | 588,829 | $ | 484,502 | ||||||||||
Total Combined Market Capitalization (Net Debt plus Equity) | $ | 6,033,660 | $ | 6,372,010 | $ | 5,920,044 | $ | 5,300,000 | $ | 4,454,952 | ||||||||||
Net debt to total combined market capitalization | 13.1 | % | 12.3 | % | 11.2 | % | 11.1 | % | 10.9 | % | ||||||||||
Net debt to Adjusted EBITDA (quarterly results annualized)(5) | 3.6x | 3.7x | 3.4x | 3.2x | 2.9x |
(1) | Excludes the following number of shares of unvested restricted stock: 244,255 (Mar 31, 2020), 212,545 (Dec 31, 2019), 214,995 (Sep 30, 2019), 219,789 (Jun 30, 2019) and 223,476 (Mar 31, 2019). |
(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 Mar 31, 2020, includes 434,368 vested LTIP Units & 429,520 vested performance units & excludes 292,751 unvested LTIP Units & 687,761 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 Series 1 preferred units at a liquidation preference of $45.50952 per unit and 906,374 outstanding Series 2 preferred units at a liquidation preference of $45.00 per unit. |
(5) | For a definition and discussion of non-GAAP financial measures, see the definitions section beginning on page 26 of this report. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 12 | ||
Debt Summary. | (unaudited and dollars in thousands) | |
Debt Detail: | ||
As of March 31, 2020 |
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% | 2.693% | $ | 58,499 | |||||||
1100-1170 Gilbert Street (Gilbert/La Palma) | 3/1/2031 | 5.125% | 5.125% | 2,419 | ||||||||
701-751 Kingshill Place | 1/5/2026 | 3.900% | 3.900% | 7,100 | ||||||||
2601-2641 Manhattan Beach Boulevard | 4/5/2023 | 4.080% | 4.080% | 4,147 | ||||||||
2410-2420 Santa Fe Avenue | 1/1/2028 | 3.700% | 3.700% | 10,300 | ||||||||
11600 Los Nietos Road | 5/1/2024 | 4.190% | 4.190% | 2,899 | ||||||||
5160 Richton Street | 11/15/2024 | 3.790% | 3.790% | 4,471 | ||||||||
2205 126th Street | 12/1/2027 | 3.910% | 3.910% | 5,200 | ||||||||
11832-11954 La Cienega Boulevard | 7/1/2028 | 4.260% | 4.260% | 4,100 | ||||||||
7612-7642 Woodwind Drive | 1/5/2024 | 5.240% | 5.240% | 3,959 | ||||||||
960-970 Knox Street | 11/1/2023 | 5.000% | 5.000% | 2,551 | ||||||||
Unsecured Debt: | ||||||||||||
$500M Revolving Credit Facility(4) | 2/13/2024(5) | LIBOR +1.05%(6) | 2.043% | — | ||||||||
$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 | ||||||||
3.520% | $ | 905,645 |
Debt Composition: | ||||||||||||
Category | Weighted Average Term Remaining (yrs)(7) | Stated Interest Rate | Effective Interest Rate | Balance | % of Total | |||||||
Fixed | 5.5 | 3.58% | 3.58% | $ | 847,146 | 94% | ||||||
Variable | 3.3 | LIBOR + 1.70% | 2.69% | $ | 58,499 | 6% | ||||||
Secured | 4.6 | 3.34% | $ | 105,645 | 12% | |||||||
Unsecured | 5.4 | 3.54% | $ | 800,000 | 88% |
First Quarter 2020 Supplemental Financial Reporting Package | Page 13 | ||
Debt Summary (Continued). | (unaudited and dollars in thousands) | |
Debt Detail: | ||
As of March 31, 2020 |
Debt Maturity Schedule: | ||||||||||||||||||
Year | Secured(8) | Unsecured | Total | % Total | Effective Interest Rate | |||||||||||||
2020 - 2021 | $ | — | $ | — | $ | — | — | % | — | % | ||||||||
2022 | — | 100,000 | 100,000 | 11 | % | 2.964 | % | |||||||||||
2023 | 65,197 | 225,000 | 290,197 | 32 | % | 2.641 | % | |||||||||||
2024 | 11,329 | — | 11,329 | 1 | % | 4.399 | % | |||||||||||
Thereafter | 29,119 | 475,000 | 504,119 | 56 | % | 4.116 | % | |||||||||||
Total | $ | 105,645 | $ | 800,000 | $ | 905,645 | 100 | % | 3.520 | % |
(1) | Includes the effect of interest rate swaps effective as of March 31, 2020, and excludes the effect of premiums/discounts, deferred loan costs and the credit facility fee. |
(2) | Excludes unamortized debt issuance costs, premiums and discounts aggregating $1.8 million as of March 31, 2020. |
(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 1.05% 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, effective interest rate will fluctuate from period to period. |
(7) | The weighted average remaining term to maturity of our consolidated debt is 5.3 years. |
(8) | Excludes the effect of scheduled monthly principal payments on amortizing loans. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 14 | ||
Portfolio Overview. | ||
At March 31, 2020 | (unaudited results) | |
Consolidated Portfolio: |
Rentable Square Feet | Occupancy % | In-Place ABR(2) | |||||||||||||||||||||||||||
Market | # Properties | Stabilized Same Properties Portfolio | Non-Stabilized Same Properties Portfolio | Total Portfolio | Stabilized Same Properties Portfolio | Non-Stabilized Same Properties Portfolio | Total Portfolio | Total Portfolio Excluding Repositioning(1) | Total (in 000’s) | Per Square Foot | |||||||||||||||||||
Central LA | 11 | 1,308,789 | 582,673 | 1,891,462 | 100.0 | % | 98.6 | % | 99.6 | % | 99.6 | % | $ | 17,718 | $9.41 | ||||||||||||||
Greater San Fernando Valley | 40 | 3,114,322 | 861,727 | 3,976,049 | 99.4 | % | 86.7 | % | 96.6 | % | 98.3 | % | 40,254 | $10.48 | |||||||||||||||
Mid-Counties | 16 | 1,038,443 | 275,389 | 1,313,832 | 97.9 | % | 76.3 | % | 93.3 | % | 97.6 | % | 12,233 | $9.97 | |||||||||||||||
San Gabriel Valley | 21 | 1,983,109 | 1,465,311 | 3,448,420 | 99.1 | % | 95.6 | % | 97.6 | % | 99.5 | % | 26,852 | $7.98 | |||||||||||||||
South Bay | 36 | 2,827,992 | 1,374,691 | 4,202,683 | 99.0 | % | 89.1 | % | 95.7 | % | 97.6 | % | 42,801 | $10.64 | |||||||||||||||
Los Angeles County | 124 | 10,272,655 | 4,559,791 | 14,832,446 | 99.1 | % | 91.2 | % | 96.7 | % | 98.5 | % | 139,858 | $9.75 | |||||||||||||||
North Orange County | 10 | 937,451 | 277,467 | 1,214,918 | 98.9 | % | 69.9 | % | 92.3 | % | 97.5 | % | 11,289 | $10.07 | |||||||||||||||
OC Airport | 8 | 522,595 | 179,413 | 702,008 | 98.7 | % | 67.2 | % | 90.6 | % | 90.6 | % | 7,383 | $11.61 | |||||||||||||||
South Orange County | 4 | 329,458 | 27,960 | 357,418 | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 3,577 | $10.01 | |||||||||||||||
West Orange County | 8 | 663,411 | 459,762 | 1,123,173 | 100.0 | % | 69.4 | % | 87.5 | % | 98.0 | % | 9,032 | $9.19 | |||||||||||||||
Orange County | 30 | 2,452,915 | 944,602 | 3,397,517 | 99.3 | % | 70.0 | % | 91.2 | % | 96.4 | % | 31,281 | $10.10 | |||||||||||||||
Inland Empire East | 1 | 51,867 | — | 51,867 | 83.3 | % | — | % | 83.3 | % | 83.3 | % | 293 | $6.79 | |||||||||||||||
Inland Empire West | 21 | 3,655,423 | 94,976 | 3,750,399 | 97.4 | % | 86.0 | % | 97.1 | % | 97.1 | % | 30,525 | $8.38 | |||||||||||||||
San Bernardino County | 22 | 3,707,290 | 94,976 | 3,802,266 | 97.2 | % | 86.0 | % | 96.9 | % | 96.9 | % | 30,818 | $8.37 | |||||||||||||||
Ventura | 16 | 1,227,954 | 1,225,694 | 2,453,648 | 95.7 | % | 93.8 | % | 94.8 | % | 96.8 | % | 22,576 | $9.71 | |||||||||||||||
Ventura County | 16 | 1,227,954 | 1,225,694 | 2,453,648 | 95.7 | % | 93.8 | % | 94.8 | % | 96.8 | % | 22,576 | $9.71 | |||||||||||||||
Central San Diego | 15 | 1,106,349 | 189,495 | 1,295,844 | 97.7 | % | 34.4 | % | 88.5 | % | 96.4 | % | 14,901 | $13.00 | |||||||||||||||
North County San Diego | 15 | 987,275 | 583,439 | 1,570,714 | 89.6 | % | 95.4 | % | 91.8 | % | 91.8 | % | 16,626 | $11.53 | |||||||||||||||
South County San Diego | 1 | 76,701 | — | 76,701 | 97.7 | % | — | % | 97.7 | % | 97.7 | % | 774 | $10.33 | |||||||||||||||
San Diego County | 31 | 2,170,325 | 772,934 | 2,943,259 | 94.0 | % | 80.5 | % | 90.5 | % | 93.9 | % | 32,301 | $12.13 | |||||||||||||||
CONSOLIDATED TOTAL / WTD AVG | 223 | 19,831,139 | 7,597,997 | 27,429,136 | 98.0 | % | 87.8 | % | 95.2 | % | 97.4 | % | $ | 256,834 | $9.84 |
(1) | Excludes space aggregating 614,213 square feet at nine of our properties that were in various stages of repositioning or lease-up as of March 31, 2020. See pages 21-22 for additional details on these properties. |
(2) | See page 26 for definition and details on how these amounts are calculated. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 15 | ||
Occupancy and Leasing Trends. | ||
(unaudited results, data represents consolidated portfolio only) | ||
Occupancy by County: |
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||
Occupancy:(1) | ||||||||||
Los Angeles County | 96.7% | 96.9% | 96.3% | 96.0% | 96.0% | |||||
Orange County | 91.2% | 96.3% | 92.6% | 90.9% | 91.4% | |||||
San Bernardino County | 96.9% | 97.4% | 97.9% | 97.8% | 97.4% | |||||
Ventura County | 94.8% | 94.6% | 90.8% | 85.1% | 84.8% | |||||
San Diego County | 90.5% | 91.4% | 90.6% | 92.5% | 97.4% | |||||
Total/Weighted Average | 95.2% | 96.1% | 94.9% | 94.2% | 94.6% | |||||
Consolidated Portfolio SF | 27,429,136 | 26,551,084 | 24,814,281 | 23,874,494 | 22,144,631 |
Leasing Activity: | ||||||||||
Three Months Ended | ||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||
Leasing Activity (SF):(2) | ||||||||||
New leases(3) | 424,435 | 439,138 | 396,115 | 651,023 | 527,869 | |||||
Renewal leases(3) | 1,169,923 | 1,022,293 | 618,982 | 1,069,391 | 604,014 | |||||
Gross leasing | 1,594,358 | 1,461,431 | 1,015,097 | 1,720,414 | 1,131,883 | |||||
Expiring leases | 1,486,424 | 1,459,500 | 1,011,691 | 1,289,743 | 916,362 | |||||
Expiring leases - placed into repositioning | 198,762 | — | — | — | 132,650 | |||||
Net absorption | (90,828) | 1,931 | 3,406 | 430,671 | 82,871 | |||||
Retention rate(4) | 80% | 71% | 62% | 85% | 70% |
Weighted Average New / Renewal Leasing Spreads: | ||||||||||
Three Months Ended | ||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||||||
GAAP Rent Change | 36.6% | 42.0% | 31.2% | 39.4% | 26.2% | |||||
Cash Rent Change | 24.4% | 27.1% | 19.4% | 22.3% | 17.3% |
(1) | See page 15 for the occupancy by County of our total consolidated portfolio excluding repositioning space. |
(2) | Excludes month-to-month tenants. |
(3) | Renewal leasing activity for Q1'20, Q4'19, Q3'19, Q2'19 and Q1'19 excludes relocations/expansions within Rexford’s portfolio totaling 15,002 RSF, 17,181 RSF, 7,028 RSF, 32,496 RSF and 34,737, 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). |
First Quarter 2020 Supplemental Financial Reporting Package | Page 16 | ||
Leasing Statistics. | ||
(unaudited results, data represents consolidated portfolio only) | ||
Leasing Activity: |
# Leases Signed | SF of Leasing | Weighted Average Lease Term (Years) | ||||
First Quarter 2020: | ||||||
New | 47 | 424,435 | 4.3 | |||
Renewal | 60 | 1,169,923 | 4.3 | |||
Total/Weighted Average | 107 | 1,594,358 | 4.3 |
Change in Annual Rental Rates and Turnover Costs for Current Quarter Leases: | ||||||||||||||||
GAAP Rent | Cash Rent | |||||||||||||||
First Quarter 2020: | Current Lease | Prior Lease | Rent Change - GAAP | Weighted Avg. Abatement (Months) | Starting Cash Rent - Current Lease | Expiring Cash Rent - Prior Lease | Rent Change - Cash | Turnover Costs per SF(3) | ||||||||
New(1) | $13.76 | $10.31 | 33.5% | 0.7 | $13.37 | $10.95 | 22.1% | $5.74 | ||||||||
Renewal(2) | $12.01 | $8.76 | 37.2% | 1.0 | $11.68 | $9.36 | 24.8% | $0.96 | ||||||||
Weighted Average | $12.24 | $8.96 | 36.6% | 1.0 | $11.90 | $9.56 | 24.4% | $1.58 |
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 | 2,133,616 | 15,641 | 96.8% | $ | 4,704 | $ | 144,562 | $10.07 | ||||||||
Orange County | 153,948 | — | 91.2% | 488 | 31,769 | $10.26 | ||||||||||
San Bernardino County | 184,782 | 14,332 | 97.3% | 460 | 31,278 | $8.46 | ||||||||||
San Diego County | 138,075 | — | 90.5% | 284 | 32,586 | $12.24 | ||||||||||
Ventura County | 96,159 | — | 94.8% | 83 | 22,658 | $9.74 | ||||||||||
Total/Weighted Average | 2,706,580 | 29,973 | 95.3% | $ | 6,019 | $ | 262,853 | $10.05 |
(1) | GAAP and cash rent statistics and turnover costs for new leases exclude 14 leases aggregating 249,537 RSF for which there was no comparable lease data. Of these 14 excluded leases, three leases for 198,762 RSF 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 land lease. |
(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 March 31, 2020. |
(5) | Includes $0.5 million of annualized base rent under Uncommenced New Leases and $5.5 million of incremental annualized base rent under Uncommenced Renewal Leases. |
(6) | See page 29 for further details on how these amounts are calculated. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 17 | ||
Leasing Statistics (Continued). | ||
(unaudited results, data represents consolidated portfolio only) | ||
Lease Expiration Schedule as of March 31, 2020: |
Year of Lease Expiration | # of Leases Expiring | Total Rentable Square Feet | In-Place + Uncommenced ABR (in thousands) | In-Place + Uncommenced ABR per SF | |||||||
Available | — | 778,819 | $ | — | $— | ||||||
Current Repositioning(1) | — | 508,673 | — | $— | |||||||
MTM Tenants | 62 | 104,180 | 1,386 | $13.30 | |||||||
2020 | 245 | 2,379,845 | 21,879 | $9.19 | |||||||
2021 | 347 | 5,429,888 | 51,054 | $9.40 | |||||||
2022 | 337 | 3,933,228 | 42,049 | $10.69 | |||||||
2023 | 221 | 3,322,327 | 37,739 | $11.36 | |||||||
2024 | 118 | 3,710,781 | 35,894 | $9.67 | |||||||
2025 | 59 | 2,330,282 | 22,750 | $9.76 | |||||||
2026 | 20 | 1,138,026 | 11,336 | $9.96 | |||||||
2027 | 11 | 669,948 | 6,544 | $9.77 | |||||||
2028 | 6 | 348,447 | 3,301 | $9.47 | |||||||
2029 | 7 | 515,599 | 5,603 | $10.87 | |||||||
Thereafter | 22 | 2,259,093 | 23,318 | $10.32 | |||||||
Total Portfolio | 1,455 | 27,429,136 | $ | 262,853 | $10.05 |
(1) | Represents vacant space at seven of our properties that were classified as current repositioning/development as of March 31, 2020. Excludes completed repositioning properties, pre-leased repositioning space, properties in lease-up and future repositioning properties. See pages 21-22 for additional details on these properties. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 18 | ||
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 | North County San Diego / South Bay | 527,861 | 2.9% | $14.23(1) | 11/30/2032 (1) | |||||
Unified Natural Foods, Inc. | Central LA | 695,120 | 2.0% | $7.63 | 5/8/2038 | |||||
Cosmetic Laboratories of America, LLC | Greater San Fernando Valley | 319,348 | 1.1% | $8.64 | 6/30/2027 | |||||
Omega/Cinema Props, Inc. | Central LA | 246,588 | 0.9% | $9.73 | 12/31/2029 | |||||
32 Cold, LLC | Central LA | 149,157 | 0.9% | $15.53 | 3/31/2026 (2) | |||||
Dendreon Pharmaceuticals, LLC | West Orange County | 184,000 | 0.8% | $12.00 | 2/28/2030 | |||||
Command Logistic Services | South Bay | 228,903 | 0.8% | $9.60 | 9/30/2025 | |||||
Triscenic Production Services, Inc. | Greater San Fernando Valley | 284,273 | 0.8% | $7.58 | 9/30/2024 (3) | |||||
Goldencorr Sheets, LLC | San Gabriel Valley | 256,993 | 0.8% | $7.92 | 4/30/2025 | |||||
Lumber Liquidators Services, LLC | San Gabriel Valley | 504,016 | 0.8% | $4.04 | 11/30/2024 | |||||
Top 10 Total / Weighted Average | 3,396,259 | 11.8% | $9.10 |
(1) | Includes (i) one land lease in North Orange County expiring January 31, 2021, (ii) 30,160 RSF expiring September 30, 2027, (iii) 42,270 RSF expiring October 31, 2030, (iv) 311,995 RSF expiring February 28, 2031, and (v) 143,436 RSF expiring November 30, 2032. |
(2) | Includes (i) 78,280 RSF expiring September 30, 2025, and (ii) 70,877 RSF expiring March 31, 2026. |
(3) | Includes (i) 38,766 RSF expiring March 31, 2020, (ii) 147,318 RSF expiring September 30, 2021, (iii) 69,219 RSF expiring March 31, 2022, and (iv) 28,970 RSF expiring September 30, 2024. |
Lease Segmentation by Size: | ||||||||||||||||||
Square Feet | Number of Leases | Leased Rentable SF | Rentable Square Feet | 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 | 716 | 1,551,350 | 1,669,294 | 92.9% | 92.9% | $ | 22,746 | 8.6% | $14.66 | |||||||||
5,000 - 9,999 | 221 | 1,573,473 | 1,655,438 | 95.0% | 95.0% | 19,892 | 7.6% | $12.64 | ||||||||||
10,000 - 24,999 | 274 | 4,357,357 | 4,642,265 | 93.9% | 95.6% | 51,169 | 19.5% | $11.74 | ||||||||||
25,000 - 49,999 | 121 | 4,311,506 | 4,599,844 | 93.7% | 97.3% | 46,085 | 17.5% | $10.69 | ||||||||||
>50,000 | 123 | 14,347,957 | 14,862,295 | 96.5% | 99.2% | 122,961 | 46.8% | $8.57 | ||||||||||
Total / Weighted Average | 1,455 | 26,141,643 | 27,429,136 | 95.3% | 97.6% | $ | 262,853 | 100.0% | $10.05 |
(1) | See page 26 for further details on how these amounts are calculated. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 19 | ||
Capital Expenditure Summary. | ||
(unaudited results, in thousands, except square feet and per square foot data) | ||
Three Months Ended March 31, 2020 |
Year to Date | |||||||||||
Total | SF(1) | PSF | |||||||||
Tenant Improvements: | |||||||||||
New Leases‐1st Generation | $ | 355 | 478,307 | $ | 0.74 | ||||||
New Leases‐2nd Generation | 27 | 50,592 | $ | 0.53 | |||||||
Renewals | 4 | 115,600 | $ | 0.03 | |||||||
Total Tenant Improvements and Space Preparation | $ | 386 | |||||||||
Leasing Commissions & Lease Costs: | |||||||||||
New Leases‐1st Generation | $ | 476 | 176,668 | $ | 2.69 | ||||||
New Leases‐2nd Generation | 723 | 258,162 | $ | 2.80 | |||||||
Renewals | 973 | 935,782 | $ | 1.04 | |||||||
Total Leasing Commissions & Lease Costs | $ | 2,172 | |||||||||
Total Recurring Capex | $ | 1,575 | 26,821,851 | $ | 0.06 | ||||||
Recurring Capex % of NOI | 2.7 | % | |||||||||
Recurring Capex % of Operating Revenue | 2.8 | % | |||||||||
Nonrecurring Capex: | |||||||||||
Development and Repositioning(2) | $ | 9,148 | |||||||||
Other Repositioning(3) | 2,088 | ||||||||||
Other(4) | 1,175 | ||||||||||
Total Nonrecurring Capex | $ | 12,411 | 15,470,056 | $ | 0.80 | ||||||
Other Capitalized Costs(5) | $ | 2,123 |
(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 March 31, 2020. For details on these properties see pages 21-22. |
(3) | Includes capital expenditures related to other space under repositioning or renovation that are not included on pages 21-22 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. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 20 | ||
Properties and Space Under Repositioning/Development.(1) | ||
As of March 31, 2020 | (unaudited results, in thousands, except square feet) | |
Development | ||||||||||||||||||||||||||||||||
Est. Construction Period(1) | ||||||||||||||||||||||||||||||||
Property (Submarket) | Projected RSF(2) | Property Leased % 3/31/20 | Start | Target Completion | Est. Period until Stabilized (mos.)(1)(3) | Purchase Price(1) | Projected Development Costs(1) | Projected Total Investment(1) | Cumulative Investment to Date(1) | Est. Annual Stabilized Cash NOI(1) | Estimated Stabilized Yield(1) | |||||||||||||||||||||
CURRENT DEVELOPMENT: | ||||||||||||||||||||||||||||||||
Avenue Paine (SF Valley) | 111,024 | 0% | 3Q-2019 | 4Q-2021 | 24 | $ | 5,515 | $ | 11,869 | $ | 17,384 | $ | 6,453 | $ | 1,047 | 6.0% | ||||||||||||||||
851 Lawrence Drive (Ventura)(4) | 90,856 | 0% | 2Q-2018 | 4Q-2020 | 13 - 16 | $ | 6,663 | $ | 11,247 | $ | 17,910 | $ | 7,328 | $ | 1,031 | 5.8% | ||||||||||||||||
12821 Knott Street (West OC)(4) | 164,368 | 0% | 1Q-2019 | 4Q-2020 | 11 - 13 | $ | 19,768 | $ | 9,714 | $ | 29,482 | $ | 20,631 | $ | 1,647 | 5.6% | ||||||||||||||||
The Merge (Inland Empire West) | 333,491 | 0% | 2Q-2019 | 3Q-2020 | 12 - 15 | $ | 23,827 | $ | 32,887 | $ | 56,714 | $ | 32,875 | $ | 2,708 | 4.8% | ||||||||||||||||
415 Motor Avenue (SG Valley)(4) | 96,950 | 0% | 4Q-2019 | 3Q-2021 | 15 - 18 | $ | 7,376 | $ | 10,097 | $ | 17,473 | $ | 7,481 | $ | 1,003 | 5.7% | ||||||||||||||||
TOTAL | 796,689 | $ | 63,149 | $ | 75,814 | $ | 138,963 | $ | 74,768 | $ | 7,436 | |||||||||||||||||||||
FUTURE DEVELOPMENT: | ||||||||||||||||||||||||||||||||
9615 Norwalk Blvd. (Mid-Counties)(4)(5) | 201,808 | (5) | 69% | 2021 | 2022 | TBD | $ | 9,642 | $ | 20,004 | $ | 29,646 | $ | 10,384 | $ | 1,925 | 6.5% | |||||||||||||||
4416 Azusa Canyon Rd. (SG Valley)(4) | 128,350 | 100% | 1Q-2021 | 4Q-2021 | TBD | $ | 12,277 | $ | 12,728 | $ | 25,005 | $ | 12,322 | $ | 1,347 | 5.4% | ||||||||||||||||
TOTAL | 330,158 | $ | 21,919 | $ | 32,732 | $ | 54,651 | $ | 22,706 | $ | 3,272 |
Repositioning | |||||||||||||||||||||||||||||||||||
Est. Construction Period(1) | |||||||||||||||||||||||||||||||||||
Property (Submarket) | Total Property RSF | RSF Under Repo/ Lease-Up | Property Leased % 3/31/20 | Start | Target Completion | Est. Period to Stabilization (mos.)(1)(3) | Purchase Price(1) | Projected Repo Costs(1) | Projected Total Investment(1) | Cumulative Investment to Date(1) | Est. Annual Stabilized Cash NOI(1) | Estimated Stabilized Yield(1) | |||||||||||||||||||||||
CURRENT REPOSITIONING: | |||||||||||||||||||||||||||||||||||
16121 Carmenita Rd. (Mid-Counties) | 109,780 | 57,855 | 47% | 1Q-2019 | 2Q-2020 | 5 - 7 | $ | 13,452 | $ | 2,553 | $ | 16,005 | $ | 15,643 | $ | 906 | 5.7% | ||||||||||||||||||
10015 Waples Court (Central SD) | 106,412 | 106,412 | 0% | 2Q-2019 | 2Q-2020 | 5 - 7 | $ | 21,435 | $ | 4,195 | $ | 25,630 | $ | 23,668 | $ | 1,356 | 5.3% | ||||||||||||||||||
1210 N. Red Gum Street (North OC) | 64,570 | 64,570 | 0% | 1Q-2020 | 2Q-2020 | 4 - 6 | $ | 7,664 | $ | 1,655 | $ | 9,319 | $ | 7,812 | $ | 589 | 6.3% | ||||||||||||||||||
727 Kingshill Place (South Bay)(6) | 45,160 | 45,160 | 0% | 1Q-2020 | 4Q-2020 | 6 - 9 | $ | 8,894 | $ | 872 | $ | 9,766 | $ | 8,894 | $ | 487 | 5.0% | ||||||||||||||||||
TOTAL | 325,922 | 273,997 | $ | 51,445 | $ | 9,275 | $ | 60,720 | $ | 56,017 | $ | 3,338 | |||||||||||||||||||||||
LEASE-UP: | |||||||||||||||||||||||||||||||||||
29003 Avenue Sherman (SF Valley) | 68,123 | 68,123 | 0% | 3Q-2018 | 4Q-2019 | 5 - 8 | $ | 9,531 | $ | 1,284 | $ | 10,815 | $ | 10,497 | $ | 560 | 5.2% | ||||||||||||||||||
STABILIZED(1): | |||||||||||||||||||||||||||||||||||
2455 Conejo Spectrum St.(Ventura)(7) | 98,218 | — | 100% | 1Q-2019 | 3Q-2019 | -- | $ | 19,035 | $ | 1,088 | $ | 20,123 | $ | 20,006 | $ | 1,058 | 5.3% | ||||||||||||||||||
635 8th Street (SF Valley) | 72,250 | — | 100% | 2Q-2019 | 1Q-2020 | -- | $ | 14,668 | $ | 1,711 | $ | 16,379 | $ | 16,373 | $ | 825 | 5.0% | ||||||||||||||||||
TOTAL | 170,468 | — | $ | 33,703 | $ | 2,799 | $ | 36,502 | $ | 36,379 | $ | 1,883 |
First Quarter 2020 Supplemental Financial Reporting Package | Page 21 | ||
Properties and Space Under Repositioning/Development Continued.(1) | ||
As of March 31, 2020 | (unaudited results, in thousands, except square feet) | |
Repositioning Space | |||||||||||||||||||||||||
Estimated Construction Period(1) | |||||||||||||||||||||||||
Property (Submarket) | Total Property RSF | Space Under Repositioning/Lease-Up | Start | Target Completion | Estimated Period until Stabilized (months)(1)(2) | Projected Repo Costs(1) | Repositioning Costs Incurred to Date | Total Property Leased % 3/31/20 | Estimated Annual Stabilized Cash NOI(1) | ||||||||||||||||
LEASE-UP: | |||||||||||||||||||||||||
7110 E. Rosecrans Avenue - Unit B (South Bay)(8) | 74,856 | 37,417 | 1Q-2019 | 3Q-2019 | 4 - 6 | $ | 1,458 | $ | 1,122 | 50% | $ | 337 | |||||||||||||
Stabilized Repositionings: Properties and Space | |||||||||||||||||||||||||
Property (Submarket) | Rentable Square Feet | Stabilized Period | Stabilized Yield | ||||||||||||||||||||||
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% | ||||||||||||||||||||||
3233 Mission Oaks Blvd. - Unit H / Unit 3233 (Ventura) | 43,927 (Unit H) / 109,636 (Unit 3233) | 1Q-2018 / 4Q-2019 | 9.0%(9) | ||||||||||||||||||||||
2722 Fairview Street (OC Airport) | 116,575 | 4Q-2019(10) | (10) | ||||||||||||||||||||||
2455 Conejo Spectrum St.(Ventura) | 98,218 | 1Q-2020 | 5.3% | ||||||||||||||||||||||
635 8th Street (SF Valley) | 72,250 | 1Q-2020 | 5.0% |
(1) | For definitions of “Properties and Space Under Repositioning,” “Estimated Construction Period,” “Purchase Price,” “Projected Repositioning/Development Costs,” “Projected Total Investment,” “Cumulative Investment to Date,” “Estimated Annual Stabilized Cash NOI,” “Estimated Stabilized Yield” and “Stabilization Date - Properties and Space Under Repositioning” see page 28 in the Notes and Definitions section of this report. |
(2) | Represents the estimated rentable square footage of the project upon completion of development. |
(3) | Represents the estimated remaining number of months, as of March 31, 2020, for the project to reach stabilization. Includes time to complete construction and lease-up the project. Actual number of months required to reach stabilization may vary materially from our estimates. |
(4) | As of March 31, 2020, these projects have existing buildings aggregating 343,548 RSF (also included in our Total Portfolio RSF) that we intend to demolish prior to constructing new buildings. Includes the following projects: 851 Lawrence (49,976 RSF), 12821 Knott Street (120,800 RSF), 415 Motor Avenue (63,900 RSF), 9615 Norwalk Blvd. (38,362 RSF) and 4416 Azusa Canyon Road (70,510 RSF). |
(5) | 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 March 31, 2021. We will demolish the existing buildings and construct a new 201,808 RSF building upon termination of the land lease. |
(6) | During 1Q-2020, we acquired 701-751 Kingshill Place, a six-building property. Amounts presented on this page represent one of the six buildings located at 727 Kingshill Place. |
(7) | During 1Q-2019, we acquired Conejo Spectrum Business Park, a nine-building property. Amounts presented on this page represent one of the nine buildings located at 2455 Conejo Spectrum Street. |
(8) | As of March 31, 2020, 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. |
(9) | Represents the stabilized yield for the entire 3233 Mission Oaks Boulevard property (461,717 RSF). |
(10) | Based on our definition of “Stabilization Date - Properties and Space Under Repositioning,” 2722 Fairview is considered stabilized as of December 31, 2019, which is one year from the date of completion of repositioning construction work. Upon lease-up of the remainder of the property (estimated to occur between April 2020 and July 2020), we project that the stabilized yield will be 6.1%. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 22 | ||
Current Year Acquisitions and Dispositions Summary. | ||
As of March 31, 2020 | (unaudited results, data represents consolidated portfolio only) |
2020 Current Period Acquisitions | |||||||||||||||
Acquisition Date | Property Address | County | Submarket | Rentable Square Feet | Acquisition Price ($ in MM) | Occ. % at Acquisition | Occ.% at Mar 31, 2020 | ||||||||
3/5/2020 | 701-751 Kingshill Place(1) | Los Angeles | South Bay | 169,069 | $32.97 | 73% | 73% | ||||||||
3/5/2020 | 2601-2641 Manhattan Beach Blvd(1) | Los Angeles | South Bay | 126,726 | $38.23 | 96% | 96% | ||||||||
3/5/2020 | 2410-2420 Santa Fe Avenue(1) | Los Angeles | South Bay | 112,000 | $34.70 | 100% | 100% | ||||||||
3/5/2020 | 11600 Los Nietos Road(1) | Los Angeles | Mid-Counties | 103,982 | $16.61 | 100% | 100% | ||||||||
3/5/2020 | 5160 Richton Street(1) | San Bernardino | Inland Empire - West | 94,976 | $15.61 | 86% | 86% | ||||||||
3/5/2020 | 2205 W. 126th Street(1) | Los Angeles | South Bay | 63,532 | $17.10 | 40% | 40% | ||||||||
3/5/2020 | 11832-11954 La Cienega Blvd(1) | Los Angeles | South Bay | 63,462 | $19.15 | 93% | 93% | ||||||||
3/5/2020 | 7612-7642 Woodwind Drive(1) | Orange | West Orange County | 62,377 | $13.72 | 100% | 100% | ||||||||
3/5/2020 | 960-970 Knox Street(1) | Los Angeles | South Bay | 39,400 | $9.60 | 100% | 100% | ||||||||
3/5/2020 | 25781 Atlantic Ocean Drive(1) | Orange | South Orange County | 27,960 | $5.48 | 100% | 100% | ||||||||
Total 2020 Current Period Acquisitions: | 863,484 | $203.17 | |||||||||||||
2020 Subsequent Period Acquisitions | |||||||||||||||
Acquisition Date | Property Address | County | Submarket | Rentable Square Feet | Acquisition Price ($ in MM) | Occ. % at Acquisition | Occ.% at Mar 31, 2020 | ||||||||
4/1/2020 | Brady Way(2) | Orange | West Orange County | — | $0.87 | n/a | n/a | ||||||||
4/3/2020 | 720-750 Vernon Avenue | Los Angeles | San Gabriel Valley | 71,692 | $15.52 | 100% | n/a | ||||||||
Total Year-to-Date Acquisitions | 935,176 | $219.56 |
(1) | These properties were acquired as part of ten-property portfolio acquisition for $203.2 million, including assumed debt. The acquisition was completed through a combination of cash and an UPREIT transaction, whereby the seller contributed a portion of the portfolio value to the Company's operating partnership in exchange for a blend of OP Units and newly issued convertible preferred operating partnership units ("Series 2 CPOP Units"). The newly issued Series 2 CPOP Units are non-callable by the Company for five years and feature a $45.00 liquidation preference, 4.0% dividend and 0.7722% conversion premium, all of which are more fully described in the Current Report on Form 8-K filed with the SEC on March 6, 2020. |
(2) | Brady Way is a 1 acre parcel of land adjacent to our property located at 12821 Knott Street. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 23 | ||
Guidance. | ||
As of March 31, 2020 |
METRIC | 2020 GUIDANCE / ASSUMPTIONS | ||||
INITIAL GUIDANCE | Q1’20 UPDATED GUIDANCE | RESULTS AS OF MARCH 31, 2020 | |||
Net Income Attributable to Common Stockholders per diluted share (1) | $0.37 - $0.39 (2) | $0.28 - $0.31 | ê | $0.09 | |
Company share of Core FFO per diluted share (1) | $1.30 - $1.32 (2) | $1.26 - $1.29 | ê | $0.33 | |
Stabilized Same Property Portfolio NOI Growth (3) | 3.7% - 4.2% | 1.3% - 1.8% | ê | 3.7% | |
Year-End Stabilized Same Property Portfolio Occupancy (3) | 96.0% - 97.0%(4) | 95.0% - 96.0% | ê | 98.0% | |
General and Administrative Expenses (5) | $36.5M - $37.0M | $36.5M - $37.0M | — | $9.3M |
(1) | Our Net Income and Core FFO guidance refers to the Company's in-place portfolio as of May 4, 2020, and does not include any assumptions for acquisitions, dispositions or balance sheet activities that may or may not occur later during the year. The Company’s in-place portfolio as of May 4, 2020, reflects the acquisition of one property containing 71,692 rentable square feet that occurred subsequent to March 31, 2020. |
(2) | See page 29 for a reconciliation of the Company’s 2020 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 Stabilized Same Property Portfolio is a subset of our consolidated portfolio and includes properties that were wholly owned by us for the period from January 1, 2019 through May 4, 2020, and that were stabilized as of January 1, 2019. Therefore, our Stabilized Same Property Portfolio excludes properties that were or will be classified as repositioning (current and future) or lease-up during 2019 and 2020. For 2020, our Stabilized Same Property Portfolio consists of 161 properties aggregating 19,831,139 rentable square feet. |
(4) | Our general and administrative expense guidance includes estimated non-cash equity compensation expense of $14.0 million. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 24 | ||
Net Asset Value Components. | ||
As of March 31, 2020 | (unaudited and in thousands, except share data) |
Net Operating Income | ||
Pro Forma Net Operating Income (NOI)(1) | Three Months Ended March 31, 2020 | |
Total operating rental income | $77,490 | |
Property operating expenses | (18,114) | |
Pro forma effect of uncommenced leases(2) | 1,455 | |
Pro forma effect of acquisitions(3) | 1,747 | |
Pro forma NOI effect of properties and space under repositioning(4) | 3,468 | |
Pro Forma NOI | 66,046 | |
Amortization of net below-market lease intangibles | (2,402) | |
Straight line rental revenue adjustment | (1,672) | |
Pro Forma Cash NOI | $61,972 | |
Balance Sheet Items | ||
Other assets and liabilities | March 31, 2020 | |
Cash and cash equivalents | $112,432 | |
Restricted cash | 46 | |
Rents and other receivables, net | 5,859 | |
Other assets | 10,717 | |
Acquisition related deposits | 5,896 | |
Accounts payable, accrued expenses and other liabilities | (39,000) | |
Dividends payable | (25,931) | |
Tenant security deposits | (30,342) | |
Prepaid rents | (8,074) | |
Estimated remaining cost to complete repositioning projects | (101,619) | |
Total other assets and liabilities | $(70,016) | |
Debt and Shares Outstanding | ||
Total consolidated debt(5) | $905,645 | |
Preferred stock/units - liquidation preference | $319,068 | |
Common shares outstanding(6) | 116,087,092 | |
Operating partnership units outstanding(7) | 3,917,284 | |
Total common shares and operating partnership units outstanding | 120,004,376 |
(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 January 1, 2020. |
(3) | Represents the estimated incremental NOI from Q1'20 acquisitions as if they had been acquired on January 1, 2020. 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 January 1, 2020. |
(4) | Represents the estimated incremental NOI from the properties that were classified as current or future repositioning or lease-up during the three months ended March 31, 2020, assuming that all repositioning work had been completed and all of the properties/space were fully stabilized as of January 1, 2020. See pages 21-22 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 January 1, 2020. |
(5) | Excludes unamortized loan discount and debt issuance costs totaling $1.8 million. |
(6) | Represents outstanding shares of common stock of the Company, which excludes 244,255 shares of unvested restricted stock. |
(7) | 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 434,368 vested LTIP Units and excludes 292,751 unvested LTIP Units and 687,761 unvested performance units. |
First Quarter 2020 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 March 31, 2020, multiplied by 12. Includes leases that have commenced as of March 31, 2020 or leases where tenant has taken early possession of space as of March 31, 2020. 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 March 31, 2020. |
• | 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 March 31, 2020, 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 March 31, 2020. |
• | Uncommenced New Leases: Reflects new leases (for vacant space) that have been signed but have not yet commenced as of March 31, 2020. |
• | Uncommenced Renewal Leases: Reflects renewal leases (for space occupied by renewing tenant) that have been signed but have not yet commenced as of March 31, 2020. |
First Quarter 2020 Supplemental Financial Reporting Package | Page 26 | ||
Notes and Definitions. | ||
Mar 31, 2020 | |||||
Current Period Covenant | Credit Facility, $225M Term Loan and $150M Term Loan | Senior Notes ($100M, $125M, $25M, $75M) | |||
Maximum Leverage Ratio | less than 60% | 21.1% | 21.1% | ||
Maximum Secured Leverage Ratio | less than 45% | 2.4% | N/A | ||
Maximum Secured Leverage Ratio | less than 40% | N/A | 2.4% | ||
Maximum Secured Recourse Debt | less than 15% | N/A | —% | ||
Minimum Tangible Net Worth | $2,299,851 | $3,078,110 | N/A | ||
Minimum Tangible Net Worth | $2,211,261 | N/A | $3,078,110 | ||
Minimum Fixed Charge Coverage Ratio | at least 1.50 to 1.00 | 4.4 to 1.00 | 4.4 to 1.00 | ||
Unencumbered Leverage Ratio | less than 60% | 21.1% | 21.1% | ||
Unencumbered Interest Coverage Ratio | at least 1.75 to 1.00 | 7.71 to 1.00 | 7.71 to 1.00 |
For the Three Months Ended | |||||||||||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||||||||||
EBITDAre | $ | 50,244 | $ | 48,031 | $ | 44,334 | $ | 41,921 | $ | 39,184 | |||||||||
Amortization of above/below market lease intangibles | (2,402 | ) | (2,191 | ) | (2,065 | ) | (1,900 | ) | (1,751 | ) | |||||||||
Non-cash stock compensation | 3,570 | 2,800 | 2,668 | 2,709 | 2,579 | ||||||||||||||
Straight line rental revenue adj. | (1,672 | ) | (2,200 | ) | (2,080 | ) | (1,241 | ) | (2,067 | ) | |||||||||
Capitalized payments | (1,200 | ) | (984 | ) | (1,064 | ) | (955 | ) | (866 | ) | |||||||||
Recurring capital expenditures | (1,575 | ) | (1,383 | ) | (1,851 | ) | (1,280 | ) | (2,294 | ) | |||||||||
2nd gen. tenant improvements & leasing commissions | (1,727 | ) | (1,754 | ) | (1,211 | ) | (1,358 | ) | (1,209 | ) | |||||||||
Cash flow for fixed charge coverage calculation | 45,238 | 42,319 | 38,731 | 37,896 | 33,576 | ||||||||||||||
Cash interest expense calculation detail: | |||||||||||||||||||
Interest expense | 7,449 | 7,364 | 6,785 | 6,255 | 6,471 | ||||||||||||||
Capitalized interest | 867 | 867 | 1,311 | 1,053 | 629 | ||||||||||||||
Note payable premium amort. | 16 | (2 | ) | (1 | ) | (2 | ) | (1 | ) | ||||||||||
Amort. of deferred financing costs | (343 | ) | (347 | ) | (347 | ) | (345 | ) | (344 | ) | |||||||||
Cash interest expense | 7,989 | 7,882 | 7,748 | 6,961 | 6,755 | ||||||||||||||
Scheduled principal payments | 40 | 40 | 40 | 39 | 39 | ||||||||||||||
Preferred stock/unit dividends | 3,936 | 3,936 | 2,872 | 2,694 | 2,423 | ||||||||||||||
Fixed charges | $ | 11,965 | $ | 11,858 | $ | 10,660 | $ | 9,694 | $ | 9,217 | |||||||||
Fixed Charge Coverage Ratio | 3.8 | x | 3.6 | x | 3.6 | x | 3.9 | x | 3.6 | x |
First Quarter 2020 Supplemental Financial Reporting Package | Page 27 | ||
Notes and Definitions. | ||
• | Properties and Space Under Repositioning: Typically defined as properties or units where a significant amount of space is held vacant in order to implement capital improvements that improve the functionality (not including basic refurbishments, i.e., paint and carpet), cash flow and value of that space. We define a significant amount of space at a property as the lower of (i) 40,000 square feet of space or (ii) 50% of a property’s square footage. Typically, we would include properties or space where the repositioning and lease-up time frame is estimated to be greater than six months. A repositioning is considered complete once the investment is fully or nearly fully deployed and the property is marketable for leasing. We look to update this definition on an annual basis based on the growth and size of the Company’s consolidated portfolio. |
• | Estimated Construction Period: The Start of the Estimated Construction Period is the period we start activities to get a property ready for its intended use, which includes pre-construction activities, including entitlements, permitting, design, site work, and other necessary activities preceding construction. The Target Completion of the Estimated Construction Period is our current estimate of the period in which we will have substantially completed a project and the project is made available for occupancy. We expect to update our timing estimates on a quarterly basis. |
• | Purchase Price: Represents the contractual purchase price of the property plus closing costs. |
• | Projected Repositioning/Development Costs: Represents the estimated costs to be incurred to complete construction and lease-up each repositioning/development project. Estimated costs include (i) nonrecurring capital expenditures, (ii) estimated tenant improvement allowances/costs and (iii) estimated leasing commissions. 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. |
• | Projected Total Investment: Includes the sum of the Purchase Price and Projected Repositioning/Development Costs. |
• | Cumulative Investment to Date: Includes the Purchase Price and nonrecurring capital expenditures, tenant improvement costs and leasing commission costs incurred as of the reporting date. |
• | Estimated Annual Stabilized Cash NOI: Represents management’s estimate of each project’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. |
• | Estimated Stabilized Yield: Calculated by dividing each project’s Estimated Annual Stabilized Cash NOI by its Projected Total Investment. |
• | Stabilization Date - Properties and Space Under Repositioning: We consider a repositioning/development property to be stabilized at the earlier of the following: (i) upon reaching 90% occupancy or (ii) one year from the date of completion of repositioning construction work. |
Three Months Ended | |||||||||||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||||||||||
Rental revenue | $ | 65,255 | $ | 62,137 | $ | 56,442 | $ | 53,599 | $ | 50,286 | |||||||||
Tenant reimbursements | 11,993 | 11,381 | 10,193 | 9,776 | 9,041 | ||||||||||||||
Other income | 242 | 497 | 385 | 238 | 277 | ||||||||||||||
Rental income | $ | 77,490 | $ | 74,015 | $ | 67,020 | $ | 63,613 | $ | 59,604 |
First Quarter 2020 Supplemental Financial Reporting Package | Page 28 | ||
Notes and Definitions. | ||
1210 N. Red Gum Street | 16121 Carmenita Road | 3233 Mission Oaks Boulevard |
1332-1340 Rocky Point Drive | 1998 Surveyor Avenue | 7110 E. Rosecrans Avenue |
14748-14750 Nelson Avenue | 2700-2722 Fairview Street | 851 Lawrence Drive |
15401 Figueroa Street | 28903 Avenue Paine | |
1580 Carson Street | 29003 Avenue Sherman |
Three Months Ended March 31, | |||||||||||||
2020 | 2019 | $ Change | % Change | ||||||||||
Rental revenue | $ | 49,165 | $ | 46,868 | $ | 2,297 | 4.9% | ||||||
Tenant reimbursements | 8,421 | 8,569 | (148 | ) | (1.7)% | ||||||||
Other income | 192 | 256 | (64 | ) | (25.0)% | ||||||||
Rental income | $ | 57,778 | $ | 55,693 | $ | 2,085 | 3.7% |
2020 Estimate | |||||||
Low | High | ||||||
Net income attributable to common stockholders | $ | 0.28 | $ | 0.31 | |||
Company share of depreciation and amortization | $ | 0.98 | $ | 0.98 | |||
Company share of Core FFO | $ | 1.26 | $ | 1.29 |
Three Months Ended | |||||||||||||||||||
Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | |||||||||||||||
Net Income | $ | 15,272 | $ | 24,382 | $ | 12,948 | $ | 15,954 | $ | 10,717 | |||||||||
Add: | |||||||||||||||||||
General and administrative | 9,317 | 8,215 | 7,440 | 7,301 | 7,344 | ||||||||||||||
Depreciation & amortization | 27,523 | 26,877 | 25,496 | 24,522 | 21,996 | ||||||||||||||
Acquisition expenses | 5 | (3 | ) | 122 | 29 | 23 | |||||||||||||
Interest expense | 7,449 | 7,364 | 6,785 | 6,255 | 6,471 | ||||||||||||||
Subtract: | |||||||||||||||||||
Management, leasing, and development services | 93 | 105 | 90 | 109 | 102 | ||||||||||||||
Interest income | 97 | 279 | 951 | 668 | 657 | ||||||||||||||
Gains on sale of real estate | — | 10,592 | 895 | 4,810 | — | ||||||||||||||
NOI | $ | 59,376 | $ | 55,859 | $ | 50,855 | $ | 48,474 | $ | 45,792 | |||||||||
S/L rental revenue adj. | (1,672 | ) | (2,200 | ) | (2,080 | ) | (1,241 | ) | (2,067 | ) | |||||||||
Amortization of above/below market lease intangibles | (2,402 | ) | (2,191 | ) | (2,065 | ) | (1,900 | ) | (1,751 | ) | |||||||||
Cash NOI | $ | 55,302 | $ | 51,468 | $ | 46,710 | $ | 45,333 | $ | 41,974 |
Three Months Ended March 31, | |||||||
2020 | 2019 | ||||||
Net income | $ | 15,272 | $ | 10,717 | |||
Add: | |||||||
General and administrative | 9,317 | 7,344 | |||||
Depreciation and amortization | 27,523 | 21,996 | |||||
Acquisition expenses | 5 | 23 | |||||
Interest expense | 7,449 | 6,471 | |||||
Deduct: | |||||||
Management, leasing and development services | 93 | 102 | |||||
Interest income | 97 | 657 | |||||
NOI | $ | 59,376 | $ | 45,792 | |||
Non-Stabilized Same Property Portfolio rental income | (19,712 | ) | (3,911 | ) | |||
Non-Stabilized Same Property Portfolio property expenses | 4,975 | 1,173 | |||||
Stabilized Same Property Portfolio NOI | $ | 44,639 | $ | 43,054 | |||
Straight line rental revenue adjustment | (645 | ) | (1,735 | ) | |||
Amort. of above/below market lease intangibles | (1,489 | ) | (1,764 | ) | |||
Stabilized Same Property Portfolio Cash NOI | $ | 42,505 | $ | 39,555 |
First Quarter 2020 Supplemental Financial Reporting Package | Page 29 | ||