NEWTON, Mass.--(BUSINESS WIRE)--
HRPT Properties Trust (NYSE: HRP) today announced financial results for
the quarter ended March 31, 2009.
Results for the quarter ended March 31, 2009:
Net income available for common shareholders was $30.4 million for the
quarter ended March 31, 2009, compared to $14.7 million for the same
quarter last year. Net income available for common shareholders per
share, basic and diluted, (EPS) for the quarters ended March 31, 2009
and 2008, was $0.13 and $0.07, respectively. Net income for the quarter
ended March 31, 2009, includes an $8.7 million, or $0.04 per share, gain
on sale of property, and a $7.5 million, or $0.03 per share, gain on
early extinguishment of debt.
Funds from operations (FFO) available for common shareholders for the
quarter ended March 31, 2009, was $62.8 million, or $0.28 per share
basic, and $0.27 per share diluted, compared to FFO available for common
shareholders for the quarter ended March 31, 2008, of $63.1 million, or
$0.28 per share basic, and $0.27 per share diluted.
The weighted average number of basic and diluted common shares
outstanding totaled 225,619,502 and 254,812,160, respectively, for the
quarter ended March 31, 2009, and 225,444,497 and 254,637,155,
respectively, for the quarter ended March 31, 2008.
Occupancy and Leasing Results (excluding properties classified in
discontinued operations):
As of March 31, 2009, 89.5% of HRP's total square feet was leased,
compared to 90.4% as of December 31, 2008 and 91.4% as of March 31, 2008.
HRP signed new leases for 190,000 square feet and lease renewals for
755,000 square feet during the quarter ended March 31, 2009, for
weighted average rental rates that were 6% above prior rents for the
same space. Average lease terms for leases signed during the first
quarter of 2009 were 5.0 years. Commitments for tenant improvement and
leasing commission (TI/LC) costs for leases signed during the quarter
ended March 31, 2009, totaled $7.12 per square foot on a weighted
average basis.
Investing and Financing Activities:
During the first quarter of 2009, HRP acquired four office properties
with 392,000 square feet of space for $57.5 million, excluding closing
costs, and sold one property with 50,000 square feet of space for $19.3
million, excluding closing costs.
During the three month period ended March 31, 2009, HRP repurchased
4,050,000 of its common shares at an average price of $3.57/share.
Because of changing market conditions, HRP has not purchased any
additional common shares since March 31, 2009. During the three months
ended March 31, 2009, HRP also purchased $31.8 million face amount of
its publicly issued debt securities and realized a gain on early
extinguishment of debt of approximately $7.5 million, net of unamortized
issuance costs. Since March 31, 2009, HRP has purchased additional debt
securities with a face amount of $67.7 million, which resulted in a gain
on early extinguishment of debt of approximately $11.5 million, net of
unamortized issuance costs and discounts, that will be reported in the
second quarter of 2009.
Conference Call:
On Thursday, May 7, 2009, at 1:00 p.m. Eastern Time, Adam Portnoy,
Managing Trustee, and John Popeo, Chief Financial Officer, will host a
conference call to discuss the first quarter 2009 results.
The conference call telephone number is (800) 239-9838. Participants
calling from outside the United States and Canada should dial (913)
312-1265. No pass code is necessary to access either call. Participants
should dial in about 15 minutes prior to the scheduled start of the
call. A replay of the conference call will be available through 4:00
p.m. Eastern Time on Thursday, May 14, 2009. To hear the replay, dial
(719) 457-0820. The replay pass code is 1897104.
A live audio webcast of the conference call will also be available in a
listen only mode on HRP's web site, which is located at www.hrpreit.com.
Participants wanting to access the webcast should visit HRP's web site
about five minutes before the call. The archived webcast will be
available for replay on HRP's web site for about one week after the call.
Supplemental Data:
A copy of HRP's First Quarter 2009 Supplemental Operating and Financial
Data is available for download at HRP's web site, www.hrpreit.com.
HRPT Properties Trust is a real estate investment trust, or REIT, which
primarily owns office buildings located throughout the United States. As
of March 31, 2009, HRP owned 541 operating properties with 67.3 million
square feet, including approximately 17 million square feet of leased
industrial and commercial lands in Oahu, Hawaii. HRP is headquartered in
Newton, Massachusetts.
Please see the pages attached hereto for a more detailed statement of
our operating results and financial condition, along with an explanation
of our calculation of FFO. HRP's web site is not incorporated as part of
this press release.
WARNING REGARDING FORWARD LOOKING STATEMENTS
THIS PRESS RELEASE CONTAINS FORWARD LOOKING STATEMENTS WITHIN THE
MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND
OTHER SECURITIES LAWS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON
HRP'S PRESENT BELIEFS AND EXPECTATIONS, BUT THEY ARE NOT GUARANTEED TO
OCCUR AND MAY NOT OCCUR. FOR EXAMPLE:
-- THIS PRESS RELEASE STATES THAT HRP HAS REPURCHASED SOME OF ITS EQUITY
AND DEBT SECURITIES. THE IMPLICATIONS OF THESE STATEMENTS MAY BE THAT
HRP WILL CONTINUE TO REPURCHASE ITS EQUITY AND DEBT SECURITIES. IN FACT,
HRP HAS REPURCHASED ITS SECURITIES ON AN OPPORTUNISTIC BASIS, WHEN
OPPORTUNITIES TO DO SO HAVE BEEN AVAILABLE AT PRICES HRP BELIEVES ARE
ATTRACTIVE AND HRP HAS AVAILABLE FINANCIAL RESOURCES. HRP MAY
ACCELERATE, DELAY, DISCONTINUE OR RESTART MAKING SUCH PURCHASES AT ANY
TIME, IN ITS DISCRETION.
RESULTS DIFFERENT FROM THOSE STATED OR IMPLIED BY FORWARD LOOKING
STATEMENTS MAY OCCUR FOR MANY DIFFERENT REASONS, SOME OF WHICH, LIKE
CHANGES IN THE PRICES OF THE SECURITIES AVAILABLE FOR PURCHASE, ARE ONLY
PARTIALLY WITHIN HRP'S CONTROL, AND SOME OF WHICH, SUCH AS CHANGES IN
FINANCIAL MARKET CONDITIONS GENERALLY, ARE BEYOND HRP'S CONTROL.
INVESTORS SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD LOOKING
STATEMENTS AND THEIR IMPLICATIONS IN THIS PRESS RELEASE.
EXCEPT AS REQUIRED BY LAW, HRP DOES NOT ASSUME ANY OBLIGATIONS TO UPDATE
ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, CHANGED
CIRCUMSTANCES, FUTURE EVENTS OR OTHERWISE.
HRPT Properties Trust
Consolidated Statements of Income and Funds from Operations
(amounts in thousands, except per share data)
Quarter Ended
March 31,
2009 2008
Rental income $216,923 $201,172
Expenses:
Operating expenses 91,739 81,217
Depreciation and amortization 48,390 44,813
General and administrative 9,487 8,862
Acquisition costs 259 --
Total expenses 149,875 134,892
Operating income 67,048 66,280
Interest income 145 329
Interest expense (including amortization of debt
discounts, premiums and deferred financing fees of (43,859 ) (45,040 )
$1,642 and $1,095, respectively)
Gain on early extinguishment of debt 7,513 --
Income from continuing operations before income tax 30,847 21,569
expense
Income tax expense (152 ) (164 )
Income from continuing operations 30,695 21,405
Discontinued operations:
Income from discontinued operations 3,672 6,001
Gain on sale of property 8,745 --
Net income 43,112 27,406
Preferred distributions (12,667 ) (12,667 )
Net income available for common shareholders $30,445 $14,739
Calculation of Funds from Operations, or FFO (1):
Net income $43,112 $27,406
Plus: depreciation and amortization from continuing 48,390 44,813
operations
Plus: depreciation and amortization from discontinued 11 3,550
operations
Plus: acquisition costs (2) 259 --
Less: gain on early extinguishment of debt (7,513 ) --
Less: gain on sale of property (8,745 ) --
FFO 75,514 75,769
Less: preferred distributions (12,667 ) (12,667 )
FFO available for common shareholders $62,847 $63,102
Weighted average common shares outstanding - basic 225,619 225,444
Weighted average common shares outstanding - diluted (3) 254,812 254,637
Earnings per common share:
Income from continuing operations available for common $0.08 $0.04
shareholders - basic and diluted
Income from discontinued operations - basic and diluted $0.06 $0.03
Net income available for common shareholders - basic and $0.13 $0.07
diluted
FFO available for common shareholders - basic $0.28 $0.28
FFO available for common shareholders - diluted $0.27 $0.27
Common distributions paid $0.12 $0.21
HRPT Properties Trust
Consolidated Statements of Income and Funds from Operations
(amounts in thousands, except per share data)
(1) We compute FFO as shown in the calculations above. Our
calculations of FFO differ from the National Association of Real Estate
Investment Trusts, or NAREIT, definition because we exclude acquisition
costs as described in Note 2 below, gain on early extinguishment of debt
and loss on early extinguishment of debt unless settled in cash. We
consider FFO to be an appropriate measure of performance for a REIT,
along with net income and cash flow from operating, investing and
financing activities. We believe that FFO provides useful information to
investors because, by excluding the effects of certain historical
amounts, such as depreciation expense and gains or losses on sales of
depreciated operating properties, FFO can facilitate a comparison of
operating performance among REITs. FFO does not represent cash generated
by operating activities in accordance with generally accepted accounting
principles, or GAAP, and should not be considered an alternative to net
income or cash flow from operating activities as a measure of financial
performance or liquidity. Also, some REITs may calculate FFO differently
than us.
(2) Acquisition costs are expensed under Statement of
Financial Accounting Standards No. 141(R), "Business Combinations"
commencing January 1, 2009.
(3) As of March 31, 2009, our 15,180 outstanding series D
preferred shares were convertible into 29,193 common shares. The effect
of a conversion of our series D convertible preferred shares on income
from continuing operations available for common shareholders per share
is anti-dilutive to income, but dilutive to FFO for the quarters ended
March 31, 2009 and 2008. Set forth below is the calculation of diluted
net income available for common shareholders, diluted FFO available for
common shareholders and diluted weighted average common shares
outstanding.
Quarter Ended
March 31,
2009 2008
Net income available for common shareholders $30,445 $14,739
Add - Series D convertible preferred distributions 6,167 6,167
Net income available for common shareholders - diluted $36,612 $20,906
FFO available for common shareholders $62,847 $63,102
Add - Series D convertible preferred distributions 6,167 6,167
FFO available for common shareholders - diluted $69,014 $69,269
Weighted average common shares outstanding - basic 225,619 225,444
Effect of dilutive Series D preferred shares 29,193 29,193
Weighted average common shares outstanding - diluted 254,812 254,637
HRPT Properties Trust
Consolidated Balance Sheets
(amounts in thousands, except share data)
March 31, December 31,
2009 2008
(audited)
ASSETS
Real estate properties:
Land $1,242,053 $1,220,554
Buildings and improvements 5,051,996 5,021,703
6,294,049 6,242,257
Accumulated depreciation (894,801 ) (862,958 )
5,399,248 5,379,299
Properties held for sale 135,760 145,849
Acquired real estate leases, net 159,428 164,308
Cash and cash equivalents 35,317 15,518
Restricted cash 9,880 10,837
Rents receivable, net of allowance for doubtful 203,034 196,839
accounts of $8,305 and $8,492, respectively
Other assets, net 127,784 103,449
Total assets 6,070,451 $6,016,099
LIABILITIES AND SHAREHOLDERS' EQUITY
Revolving credit facility $297,000 $201,000
Senior unsecured debt, net 2,209,804 2,241,225
Mortgage notes payable, net 445,705 447,693
Other liabilities related to properties held for 3,451 3,400
sale
Accounts payable and accrued expenses 96,597 99,285
Acquired real estate lease obligations, net 45,577 47,839
Rent collected in advance 31,486 26,537
Security deposits 17,722 17,935
Due to affiliates 13,357 10,073
Total liabilities 3,160,699 3,094,987
Shareholders' equity:
Preferred shares of beneficial interest, $0.01 par
value:
50,000,000 shares authorized;
Series B preferred shares; 8 3/4% cumulative
redeemable at par on or after September 12, 2007; 169,079 169,079
7,000,000 shares issued and outstanding, aggregate
liquidation preference $175,000
Series C preferred shares; 7 1/8% cumulative
redeemable at par on or after February 15, 2011; 145,015 145,015
6,000,000 shares issued and outstanding, aggregate
liquidation preference $150,000
Series D preferred shares; 6 1/2% cumulative
convertible; 15,180,000 shares issued and 368,270 368,270
outstanding, aggregate liquidation preference
$379,500
Common shares of beneficial interest, $0.01 par
value:
350,000,000 shares authorized; 223,683,241 and
227,731,938 shares issued and outstanding, 2,237 2,277
respectively
Additional paid in capital 2,923,549 2,937,986
Cumulative net income 2,115,366 2,072,254
Cumulative common distributions (2,469,169 ) (2,441,841 )
Cumulative preferred distributions (344,595 ) (331,928 )
Total shareholders' equity 2,909,752 2,921,112
Total liabilities and shareholders' equity $6,070,451 $6,016,099
Source: HRPT Properties Trust
Contact: HRPT Properties Trust
Timothy A. Bonang, 617-796-8222
Director of Investor Relations
or
Katherine L. Johnston, 617-796-8222
Manager of Investor Relations
www.hrpreit.com