Silver Bay Agrees to be Acquired for $21.50 Per
Share in Cash Representing Aggregate Enterprise Value of $1.4
Billion
Purchase Price Represents 19% Premium to
February 24, 2017 Closing Price of $18.01 and 24% Premium to the 90
day trailing average price as of February 24, 20171
Reports Solid Quarterly Results Which Reflect
Strong Operating Performance
Silver Bay Realty Trust Corp. (NYSE:SBY) (the “Company” or
“Silver Bay”), a single-family rental real estate investment trust
(“REIT”), today announced that its Board of Directors has
unanimously approved and Silver Bay has entered into a definitive
agreement pursuant to which Tricon Capital Group Inc. will acquire
Silver Bay in a transaction valued at approximately $1.4 billion
and announced its operating and financial results for the quarter
and year ended December 31, 2016. Silver Bay’s stockholders will
receive $21.501 per share in cash for each outstanding share of
common stock held immediately prior to the closing of the
transaction. This purchase price represents a 19% premium to Silver
Bay’s closing price on February 24, 2017 of $18.01 and a 24%
premium to the stock’s 90 day trailing average price as of February
24, 2017.2 In addition, Tricon Capital Group Inc. will assume or
repay a total of approximately $600.0 million of Silver Bay’s debt
(net of cash on hand).
“This transaction delivers significant and immediate value to
our stockholders,” said Thomas W. Brock, Chief Executive Officer of
Silver Bay. “We have continually evaluated the most prudent way to
drive sustainable, long-term capital appreciation and we believe
this transaction is the best opportunity to return maximum value to
our stockholders.”
Mr. Brock continued, “Over the past year, we have been making
excellent strides in driving efficiency across our operating
platform. We closed out the year with the best quarter in our
company’s history, including a 96.7% occupancy rate, strong rental
increases on both re-leases and renewals, a Same-Home Core NOI
Margin of 60.7% and record Core FFO, which I credit to the
dedication and focus of our Silver Bay team. Our well-crafted
portfolio of single family properties and the recent strong
performance across our platform will serve as a great complement to
Tricon Capital Group Inc.’s business as the single family rental
industry continues to evolve and consolidate.”
The transaction, which has been unanimously approved by the
boards of directors of both companies, is subject to customary
closing conditions, including approval by the stockholders of
Silver Bay, and is expected to close in the second quarter of
2017.
Goldman, Sachs & Co. acted as sole financial advisor to
Silver Bay on the transaction. Orrick, Herrington & Sutcliffe
LLP acted as legal advisor to Silver Bay.
______________________________
1 All currency references are in U.S. Dollars 2 Represents
the volume weighted average price
Financial Results
The following table provides a summary of Silver Bay’s financial
results for the three months and years ended December 31, 2016
and 2015, respectively (unaudited):
Three Months Ended December 31,
Year Ended December 31,
2016 2015
2016
2015
Net income (loss) $ 2,862 $ (798 ) $ (2,614 ) $ (9,952 ) Net
income (loss) attributable to common stockholders $ 2,667 $ (777 )
$ (2,563 ) $ (9,475 ) Net income (loss) per share attributable to
common shares - diluted $ 0.07 $ (0.02 ) $ (0.07 ) $ (0.26 ) Core
FFO per share (1) $ 0.24 $ 0.20 $ 0.82 $ 0.66 NOI (1) $ 19,733 $
17,753 $ 73,001 $ 62,905 Core NOI Margin (1) 61.4 % 58.7 % 58.1 %
56.0 % Same-Home NOI (1) $ 13,008 $ 11,453 $ 48,401 $ 44,023
Same-Home Core NOI Margin (1) 60.7 % 56.8 % 57.3 % 55.2 % (1)
NOI, Core NOI Margin, Same-Home NOI, Same-Home Core NOI
Margin and Core FFO per share are non-GAAP financial measures and
reconciliations are included in the definitions and reconciliations
of financial and operating measures in the unaudited supplemental
financial and operating data section of this release.
Fourth Quarter 2016 Financial Results
Silver Bay reported total revenue of $32.5 million for the
fourth quarter of 2016, a 5.9% increase compared to total revenue
of $30.6 million for the fourth quarter of 2015. This increase was
primarily due to increases in the Company's rental rates and
occupancy rate. The Company owned 9,044 properties as of
December 31, 2016, compared to 9,022 properties as of
December 31, 2015. Net income attributable to common
stockholders for the fourth quarter of 2016 was $2.7 million, or
$0.07 per diluted common share, compared to net loss attributable
to common stockholders for the fourth quarter of 2015 of $0.8
million, or $0.02 per basic and diluted common share.
The Company reported net operating income (“NOI”) of $19.7
million for the fourth quarter of 2016, an 11.2% increase compared
to NOI of $17.8 million for the fourth quarter of 2015. Core NOI
Margin improved 270 basis points to 61.4% in the fourth quarter of
2016 as compared to the same period a year ago. The increase is
primarily due to growth in total revenue. Same-Home NOI increased
to $13.0 million for the fourth quarter of 2016, a 13.6% increase
compared to Same-Home NOI of $11.5 million for the fourth quarter
of 2015. Same-Home NOI Margin improved 390 basis points to 60.7% in
the fourth quarter of 2016 as compared to the same period a year
ago. The increase in Same-Home NOI is primarily due to an increase
in Same-Home total revenue and, to a lesser extent, a decrease in
Same-Home property operating expenses. Core funds from operations
(“Core FFO”) for the fourth quarter of 2016 was $9.1 million, or
$0.24 per share, a 20.0% increase on a per share basis compared to
Core FFO for the fourth quarter of 2015 of $7.6 million, or $0.20
per share. NOI, Same-Home NOI and Core FFO are non-GAAP financial
measures. Reconciliations of net income (loss) to NOI, Same-Home
NOI and Core FFO are included in the unaudited supplemental
financial and operating data accompanying this press release.
Full Year 2016 Financial Results
Silver Bay reported total revenue of $126.6 million for the year
ended December 31, 2016, an 11.4% increase compared to total
revenue of $113.7 million for the year ended December 31,
2015. The increase in total revenue for the year ended
December 31, 2016 over the prior year was primarily due to an
increase in the number of occupied homes during the year ended
December 31, 2016 as well as increases in the Company's rental
rates and occupancy rate. Net loss attributable to common
stockholders for the year ended December 31, 2016 was $2.6
million, or $0.07 per basic and diluted common share, as compared
to net loss attributable to common stockholders for the year ended
December 31, 2015 of $9.5 million, or $0.26 per basic and
diluted common share.
The Company reported NOI of $73.0 million for the year ended
December 31, 2016, a 16.0% increase compared to NOI of $62.9
million for the year ended December 31, 2015. The increase is
primarily due to growth in total revenue. Same-Home NOI increased
to $48.4 million for the year ended December 31, 2016, a 9.9%
increase compared to Same-Home NOI of $44.0 million for the year
ended December 31, 2015. The increase in Same-Home NOI is
primarily due to an increase in Same-Home total revenue. Core FFO
for the year ended December 31, 2016 was $31.2 million, or
$0.82 per share, a 24.2% increase on a per share basis compared to
Core FFO for the year ended December 31, 2015 of $25.4
million, or $0.66 per share.
Portfolio and Operating Metrics Summary
The following table provides a summary of Silver Bay’s portfolio
and operating metrics for the fourth quarter of 2016 and 2015,
respectively:
As of December 31, 2016 As of December 31,
2015 Single-family properties owned: Aggregate portfolio 9,044
9,022 Same-Home portfolio 5,780 5,780 Occupancy rate: Aggregate
portfolio 96.7 % 95.8 % Same-Home portfolio 96.7 % 95.7 % Average
monthly rent: Aggregate portfolio $ 1,205 $ 1,167 Same-Home
portfolio $ 1,264 $ 1,216
Three Months Ended Three
Months Ended December 31, 2016 December 31, 2015
Average change in rent for re-leases: Aggregate portfolio 6.3 % 4.1
% Same-Home portfolio 6.1 % 4.1 % Average change in rent for
renewals: Aggregate portfolio 3.4 % 3.5 % Same-Home portfolio 3.4 %
3.5 % Trailing twelve-month turnover 29.5 % 27.6 % Retention rate
79.1 % 80.3 %
Aggregate Metrics
Silver Bay reported an aggregate occupancy rate of 96.7% as of
December 31, 2016, an increase from 95.8% in the fourth
quarter of 2015. A summary of Silver Bay’s occupancy rates by
market is included in the unaudited supplemental financial and
operating data accompanying this press release.
Silver Bay reported an average monthly rent for the aggregate
portfolio of $1,205 as of December 31, 2016, compared to an
average monthly rent of $1,167 as of December 31, 2015. The
Company experienced re-lease rate increases of 6.3% and renewal
rate increases of 3.4% during the fourth quarter of 2016 compared
to 4.1% and 3.5%, respectively, during the fourth quarter of
2015.
Silver Bay's trailing twelve-month turnover increased 190 basis
points to 29.5% as of December 31, 2016 from 27.6% as of
December 31, 2015. The retention rate decreased 120 basis
points to 79.1% during the fourth quarter of 2016 from 80.3% in the
fourth quarter of 2015.
Same-Home Metrics
Silver Bay reported a Same-Home occupancy rate of 96.7% as of
December 31, 2016, a 100 basis point increase compared to a
year ago. Same-Home average monthly rent increased 3.9% to $1,264
as of December 31, 2016, compared to an average monthly rent
of $1,216 as of December 31, 2015. Additional detail on the
Company's Same-Home portfolio is included in the unaudited
supplemental financial and operating data accompanying this press
release.
Investment Activity
During the fourth quarter of 2016, the Company acquired 329
single-family homes with an aggregate purchase price of $42.4
million, including a portfolio of 322 properties acquired on
October 1, 2016 for an aggregate purchase price of $41.5
million.
During the fourth quarter of 2016, the Company sold 134
single-family homes for total gross proceeds of $29.4 million with
a net gain from these sales totaling $4.5 million.
Dividend Declaration
The Company’s Board of Directors declared a quarterly dividend
of $0.13 per share of common stock for the quarter ended
December 31, 2016. The dividend was paid January 13, 2017
to common stockholders of record at the close of business on
December 30, 2016. On February 27, 2017, our board of
directors declared a quarterly dividend of $0.13 per share payable
on April 14, 2017, to stockholders of record on April 3,
2017.
Liquidity and Capital Resources
The Company's liquidity and capital resources as of
December 31, 2016 consisted of cash of $52.3 million and
escrow deposits of $16.9 million, which consists of cash held in
reserve at financial institutions as required by its debt
agreements of $14.8 million.
Cancelling Fourth Quarter 2016 Conference Call
In light of the announced agreement with Tricon Capital Group
Inc., Silver Bay has cancelled its fiscal fourth quarter and year
end 2016 conference call with analysts and investors previously
scheduled for Tuesday, February 28, 2017 at 8:30 a.m. Eastern
Time.
About Silver Bay Realty Trust Corp.
Silver Bay Realty Trust Corp. is an internally managed Maryland
corporation focused on the acquisition, renovation, leasing and
management of single-family properties for rental income and
long-term capital appreciation. Silver Bay owns single-family
properties in Arizona, California, Florida, Georgia, Nevada, North
Carolina, Ohio, South Carolina and Texas. Silver Bay has elected to
be taxed as a REIT for U.S. federal tax purposes.
About Tricon Capital Group Inc.
Tricon (TSX: TCN) is a principal investor and asset manager
focused on the residential real estate industry in North America
with approximately $3.0 billion (C$4.0 billion) of assets under
management. Tricon owns, or manages on behalf of third-party
investors, a portfolio of investments in land and homebuilding
assets, single-family rental homes, manufactured housing
communities and multi-family development projects. Its business
objective is to invest for investment income and capital
appreciation through our Principal Investment business and to earn
fee income through our Private Funds and Advisory business. Since
its inception in 1988, Tricon has invested in real estate and
development projects valued at approximately $18 billion. More
information about Tricon is available at www.triconcapital.com.
Notice Regarding Non-GAAP Financial Measures
In addition to the Company's net income (loss) which is
presented in accordance with GAAP, the Company also presents
certain supplemental non-GAAP performance measures. These measures
are not to be considered more relevant or accurate than the
performance measures presented in accordance with GAAP. In
compliance with applicable rules of the Securities and Exchange
Commission ("SEC"), the Company's non-GAAP measures are reconciled
to net income (loss), the most directly comparable GAAP performance
measure, as further set forth in the definitions and
reconciliations of financial and operating measures included in the
unaudited supplemental financial and operating data. As with other
non-GAAP performance measures, neither the SEC nor any other
regulatory body has passed judgment on these non-GAAP performance
measures. NOI, Core NOI Margin, FFO and Core FFO are non-GAAP
financial measures the Company believes, when considered with the
financial statements determined in accordance with GAAP, are
helpful to investors in understanding its performance as a
REIT.
Important Information About the Transaction and Where to Find
It
In connection with the proposed transaction, the Company plans
to file a proxy statement (the “Proxy Statement”) with the
Securities and Exchange Commission (“SEC”), in connection with the
solicitation of proxies for a meeting of Silver Bay’s stockholders
to be called at a future date (the “meeting”). Promptly after
filing its Proxy Statement in definitive form with the SEC, the
Company will mail or otherwise furnish the Proxy Statement to each
stockholder entitled to vote at the meeting. Stockholders are
urged to read the Proxy Statement (including any amendments or
supplements thereto) and any other relevant documents that the
Company will file with the SEC when they become available because
they will contain important information about the proposed
transaction and related matters. Stockholders may obtain, free
of charge, copies of the Proxy Statement (if and when available)
and any other documents filed by the Company with the SEC in
connection with the transaction at the SEC’s website
(http://www.sec.gov), from the Company’s website at
www.silverbayrealtytrustcorp.com or by contacting the investor
relations department of the Company at:
Silver Bay Realty Trust Corp., Attn: Investor Relations, 3300
Fernbrook Lane North, Suite 210, Plymouth, MN 55447, telephone
(952) 358-4400.
Participation in the Solicitation
The Company and its directors, executive officers and certain
other members of management and employees of the Company may be
deemed to be “participants” in the solicitation of proxies from the
Company’s stockholders in connection with the transaction.
Information regarding the interests of the persons who may, under
the rules of the SEC, be considered participants in the
solicitation of the Company’s stockholders in connection with the
proposed transaction, which may be different than those of the
Company’s stockholders generally, will be set forth in the Proxy
Statement and the other relevant documents to be filed with the
SEC. Company stockholders can find information about the Company
and its directors and executive officers and their ownership of the
Company’s common stock in the Company’s annual report on Form 10-K
for the fiscal year ended December 31, 2015 which was filed with
the SEC on February 26, 2016, and in its definitive proxy statement
for its most recent annual meeting of stockholders, which was filed
with the SEC on April 4, 2016, and in Forms 4 of directors and
executive officers filed with the SEC. Additional information
regarding the interests of such individuals in the transaction will
be included in the Proxy Statement relating to the transaction when
it is filed with the SEC.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the federal securities laws. Forward-looking
statements relate to expectations, beliefs, projections, future
plans and strategies, anticipated events or trends and similar
expressions concerning matters that are not historical facts. In
some cases, readers can identify forward-looking statements by the
use of forward-looking terminology such as “may,” “will,” “should,”
“expects,” “intends,” “plans,” “anticipates,” “believes,”
“estimates,” “predicts,” or “potential” or the negative of these
words and phrases or similar words or phrases which are predictions
of or indicate future events or trends and which do not relate
solely to historical matters. Readers can also identify
forward-looking statements by discussions of strategy, plans or
intentions. Examples of forward-looking statements include
statements about: the proposed transaction whereby Tricon Capital
Group Inc. will acquire Silver Bay; Silver Bay’s projected
financial and operating results; Silver Bay's ability to lease and
operate acquired properties and to improve its operating
performance, including Silver Bay’s abilities and projections
related to turnover rates and time frames, operating costs, rent
increases, and occupancy rates; intentions related to asset sales,
including pricing, volume and identity of such assets; Silver Bay’s
intentions related to its capital allocation strategy, including
through the use of share repurchases and acquisitions; expectations
of portfolio size; the impact of seasonality on Silver Bay’s
results; estimates relating to Silver Bay’s ability to make
distributions to its stockholders in the future; market trends in
Silver Bay’s industry, such as homeownership rates and the impact
of such trends on its operations; future real estate values and
prices; and the general economy and its impact on Silver Bay’s
results.
The forward-looking statements contained in this press release
reflect Silver Bay’s current views about future events and are
subject to numerous known and unknown risks, uncertainties,
assumptions and changes in circumstances that may cause Silver
Bay’s actual results to differ significantly from those expressed
or implied in any forward-looking statement. Silver Bay is not able
to predict all of the factors that may affect future results.
Readers should not rely on any of these forward-looking statements.
They are neither statements of historical fact nor guarantees or
assurances of future performance. Important factors that could
cause actual results to differ materially from those in the
forward-looking statements include national, international,
regional or local economic, business, competitive, market and
regulatory conditions and the following: those factors described in
the discussion on risk factors in Part I, Item 1A, “Risk Factors”,
Part I, Item 1A “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” and Part II, Item 7A
“Quantitative and Qualitative Disclosures about Market Risk” in the
Company’s Annual Report on Form 10-K and other risks and
uncertainties detailed in Silver Bay’s other reports and filings
with the SEC; a delay in or failure to complete the proposed
acquisition of Silver Bay by Tricon Capital Group Inc.; defaults
on, early terminations of or non-renewal of leases by residents;
resident turnover or turnover costs; Silver Bay’s ability to
maintain occupancy levels and leasing traffic or to attract and
retain qualified residents in light of increased competition in the
leasing market for quality residents, the relatively short duration
of leases, inadequate marketing, reputational damage or other
reasons; Silver Bay’s ability to control or reduce operating
expenses, including repairs and maintenance expense and other costs
such as real estate taxes, homeowners’ association fees, insurance
and other costs outside the Company’s control for reasons including
damage to properties due to storms, other natural causes or
residents and other reasons; Silver Bay’s ability to successfully
operate its properties; Silver Bay’s ability to maintain rents at
levels that are sufficient to keep pace with rising costs of
operations; Silver Bay’s ability to dispose of assets at attractive
pricing levels; the amount of capital available for share
repurchases and other purposes; Silver Bay’s ability to implement
and manage its service technician initiatives or the impact of such
initiatives to reduce maintenance, turnover and other expenses as
predicted; Silver Bay’s ability to obtain financing arrangements;
Silver Bay’s failure to meet the conditions to draw under the
revolving credit facility; the Company’s ability to perform under
the covenants of its revolving credit facility and securitization
loan; general volatility of the markets in which it participates;
interest rates and the market value of Silver Bay’s assets; the
impact of changes in governmental regulations, tax law and rates,
and similar matters; difficulties in identifying properties to
acquire and completing acquisitions; increased time and/or expense
to gain possession and renovate properties; Silver Bay’s dependence
on key personnel to carry its business and investment strategies
and its ability to hire and retain skilled managerial, investment,
financial, and operational personnel, and the performance of
vendors and service providers, including third-party management
professionals, maintenance providers, leasing agents, and property
managers; and Silver Bay’s ability to remain qualified as a
REIT.
The forward-looking statements in this press release represent
Silver Bay’s views as of the date of this press
release. Subsequent events and developments could cause these
views to change. However, while Silver Bay may elect to update
these forward-looking statements at some point in the future,
Silver Bay has no current intention of doing so except to the
extent required by applicable laws. Readers should, therefore,
not rely on these forward-looking statements as representing Silver
Bay’s views as of any date subsequent to the date of this press
release. All subsequent written and oral forward looking statements
concerning Silver Bay or matters attributable to Silver Bay or any
person acting on its behalf are expressly qualified in their
entirety by the cautionary statements above.
Additional Information
Stockholders of Silver Bay, and other interested persons, may
find additional information regarding the Company at the SEC's
website at www.sec.gov or by directing requests to: Silver Bay
Realty Trust Corp., Attn: Investor Relations, 3300 Fernbrook Lane
North, Suite 210, Plymouth, MN 55447, telephone (952) 358-4400.
SILVER BAY REALTY TRUST CORP.
CONSOLIDATED BALANCE SHEETS
(AMOUNTS IN THOUSANDS EXCEPT SHARE
DATA)
(UNAUDITED)
December 31, 2016 December 31, 2015
Assets Investments in real estate: Land and land
improvements $ 216,956 $ 220,110 Building and improvements 992,867
989,574 1,209,823 1,209,684 Accumulated depreciation
(106,463 ) (74,907 ) Investments in real estate, net 1,103,360
1,134,777 Assets held for sale 16,543 11,184 Cash 52,279 29,028
Escrow deposits 16,858 15,472 Resident security deposits 12,992
12,521 Other assets 16,529 13,298
Total assets
$ 1,218,561 $ 1,216,280
Liabilities and
Equity Liabilities: Revolving credit facility $ 352,799
$ 326,472 Securitization loan, net 296,782 295,741 Accounts payable
and accrued expenses 17,862 16,752 Resident prepaid rent and
security deposits 15,237 14,462
Total
liabilities 682,680 653,427 10% cumulative
redeemable preferred stock at liquidation value, $0.01 par;
50,000,000 shares authorized, 1,000 shares issued and outstanding
1,000 1,000
Equity: Stockholders’ equity: Common stock $0.01
par; 450,000,000 shares authorized; 35,380,034 and 36,063,187,
respectively, shares issued and outstanding 352 359 Additional
paid-in capital 643,633 651,987 Accumulated other comprehensive
income (loss) 2,841 (1,613 ) Cumulative deficit (143,679 ) (121,620
) Total stockholders’ equity 503,147 529,113 Noncontrolling
interests - Operating Partnership 31,734 32,740
Total equity 534,881 561,853
Total liabilities and equity
$ 1,218,561 $ 1,216,280
SILVER BAY REALTY TRUST CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (LOSS)
(AMOUNTS IN THOUSANDS EXCEPT SHARE
DATA)
(UNAUDITED)
Three Months Ended Year Ended
December 31, December 31, 2016
2015 2016 2015 Revenue: Rental
revenue $ 31,649 $ 29,975 $ 123,544 $ 111,159 Other revenue 801
666 3,091 2,535 Total revenue 32,450
30,641 126,635 113,694
Expenses: Property operating and
maintenance 5,518 5,627 23,393 22,106 Real estate taxes 4,188 3,983
17,681 15,847 Homeowners’ association fees 407 447 1,665 1,912
Property management 2,604 2,831 10,895 11,093 Depreciation and
amortization 9,353 10,115 37,291 35,189 Portfolio acquisition
expense 403 18 526 2,064 General and administrative 3,353 3,991
14,457 15,915 Share-based compensation 658 718 2,667 2,613
Severance and other — — 1,977 — Interest expense 7,020 5,968 26,113
21,275 Impairment of real estate 601 49 1,105
95 Total expenses 34,105 33,747 137,770
128,109
Loss before other income (expense), income taxes
and non-controlling interests (1,655 ) (3,106 ) (11,135 )
(14,415 )
Other income (expense): Net gain on disposition of
real estate 4,499 1,724 10,657 4,044 Adjustments for derivative
instruments, net 157 (51 ) 44 (51 ) Other expense (272 ) (270 )
(1,211 ) (288 ) Total other income (expense) 4,384 1,403
9,490 3,705
Income (loss) before income
taxes and non-controlling interests 2,729 (1,703 ) (1,645 )
(10,710 ) Income tax (expense) benefit, net 133 905
(969 ) 758
Net income (loss) 2,862 (798 ) (2,614 )
(9,952 ) Net (income) loss attributable to noncontrolling interests
- Operating Partnership (170 ) 46 151 577
Net income (loss) attributable to controlling interests
2,692 (752 ) (2,463 ) (9,375 ) Preferred stock distributions (25 )
(25 ) (100 ) (100 )
Net income (loss) attributable to common
stockholders $ 2,667 $ (777 ) $ (2,563 ) $ (9,475 )
Income (loss) per share - basic Net income (loss)
attributable to common shares $ 0.08 $ (0.02 ) $ (0.07 ) $
(0.26 ) Weighted average common shares outstanding 35,380,056
36,069,198 35,557,636 36,209,999
Income (loss) per share - diluted Net income (loss)
attributable to common shares and units $ 0.07 $ (0.02 ) $
(0.07 ) $ (0.26 ) Weighted average common shares and units
outstanding 37,758,743 36,069,198 35,557,636
36,209,999
SILVER BAY REALTY TRUST CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (LOSS)
(AMOUNTS IN THOUSANDS EXCEPT SHARE
DATA)
(UNAUDITED)
Three Months Ended Year Ended
December 31, December 31, 2016
2015 2016 2015 Comprehensive Income
(Loss): Net income (loss) $ 2,862 $ (798 ) $ (2,614 ) $ (9,952
)
Other comprehensive income (loss): Net change in fair
value of cash flow hedges 4,428 (84 ) 4,147 (1,587 ) Losses
reclassified into earnings from other comprehensive income (loss)
59 60 307 60 Other comprehensive income
(loss) 4,487 (24 ) 4,454 (1,527 )
Comprehensive
income (loss) 7,349 (822 ) 1,840 (11,479 ) Comprehensive income
(loss) attributable to noncontrolling interests- Operating
Partnership (436 ) 138 (109 ) 669
Comprehensive
income (loss) attributable to controlling interests $ 6,913
$ (684 ) $ 1,731 $ (10,810 )
SILVER BAY REALTY TRUST CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN
EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2016
AND 2015
(AMOUNTS IN THOUSANDS EXCEPT SHARE
DATA)
(UNAUDITED)
Common Stock
Shares Par Value
Amount
Additional
Paid-In
Capital
Accumulated Other Comprehensive Income (Loss)
Cumulative
Deficit
Total
Stockholders’
Equity
Noncontrolling
Interests -
Operating
Partnership
Total
Equity
Balance at January 1, 2015 36,711,694 $ 366 $ 660,776 $ (86
) $ (94,593 ) $ 566,463 $ 34,432 $ 600,895 Non-cash equity awards,
net 132,932 1 2,522 — — 2,523 — 2,523 Repurchase and retirement of
common stock (781,439 ) (8 ) (12,426 ) — — (12,434 ) — (12,434 )
Dividends declared — — — — (17,652 ) (17,652 ) — (17,652 ) Net loss
— — — — (9,375 ) (9,375 ) (577 ) (9,952 ) Net change in fair value
of cash flow hedges — — — (1,587 ) — (1,587 ) — (1,587 ) Losses
reclassified into earnings from other comprehensive income (loss) —
— — 60 — 60 — 60 Adjustment to noncontrolling interests - Operating
Partnership — — 1,115 — — 1,115
(1,115 ) —
Balance at December 31, 2015
36,063,187 $ 359 $ 651,987 $ (1,613 ) $ (121,620 ) $ 529,113 $
32,740 $ 561,853 Non-cash equity awards, net 132,089 1 2,576 — —
2,577 — 2,577 Repurchase and retirement of common stock (815,242 )
(8 ) (11,785 ) — — (11,793 ) — (11,793 ) Dividends declared — — — —
(19,596 ) (19,596 ) — (19,596 ) Net loss — — — — (2,463 ) (2,463 )
(151 ) (2,614 ) Net change in fair value of cash flow hedges — — —
4,147 — 4,147 — 4,147 Losses reclassified into earnings from other
comprehensive income (loss) — — — 307 — 307 — 307 Adjustment to
noncontrolling interests - Operating Partnership — —
855 — — 855 (855 ) —
Balance
at December 31, 2016 35,380,034 $ 352 $ 643,633
$ 2,841 $ (143,679 ) $ 503,147 $ 31,734
$ 534,881
SILVER BAY REALTY TRUST CORP.
CONSOLIDATED STATEMENTS OF CASH
FLOWS
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
Year Ended December 31, 2016
2015 Cash Flows From Operating Activities: Net loss $ (2,614
) $ (9,952 ) Adjustments to reconcile net loss to net cash provided
by operating activities: Depreciation and amortization 37,291
35,189 Non-cash share-based compensation 2,577 2,523 Losses
reclassified into earnings from other comprehensive income (loss)
307 60 Amortization and write-off of deferred financing costs 4,597
4,668 Amortization of discount on securitization loan 301 301 Bad
debt expense 1,002 1,426 Net gain on disposition of real estate
(10,657 ) (4,044 ) Income tax valuation allowance reversal — 941
Impairment of real estate 1,105 95 Other 611 471 Net change in
assets and liabilities: Decrease in escrow cash for operating
activities and debt reserves 467 3,766 Increase in other assets
(5,008 ) (7,505 ) Increase in accounts payable, accrued expenses,
and prepaid rent 2,252 3,208 Net cash provided by
operating activities 32,231 31,147 Cash Flows From
Investing Activities: Purchase of investments in real estate
(44,037 ) (273,266 ) Capital improvements of investments in real
estate (14,498 ) (25,651 ) (Increase) decrease in escrow cash for
investing activities (77 ) 972 Proceeds from disposition of real
estate 58,149 29,223 Other — (43 ) Net cash used in
investing activities (463 ) (268,765 ) Cash Flows From Financing
Activities: Payments on securitization loan (1,514 ) (7,085 )
Proceeds from revolving credit facility 47,819 281,963 Payments on
revolving credit facility (21,493 ) (22,587 ) Deferred financing
costs paid (48 ) (5,783 ) Purchase of interest rate cap agreements
(30 ) (2,250 ) Change in interest rate swap collateral (1,776 ) —
Repurchase and retirement of common stock (11,793 ) (12,434 )
Dividends paid (19,682 ) (15,032 ) Net cash (used in) provided by
financing activities (8,517 ) 216,792 Net change in cash
23,251 (20,826 ) Cash at beginning of period 29,028 49,854
Cash at end of period $ 52,279 $ 29,028
Supplemental disclosure of cash flow information: Cash paid for
interest, net of amounts capitalized $ 20,645 $ 15,974
Cash paid for taxes $ 227 $ 181 Increase
(decrease) in fair value of cash flow hedges $ 4,147 $
(1,587 ) Non-cash investing and financing activities: Common stock
and unit dividends declared, but not paid $ 4,869 $ 4,978
Interest rate swap contingent consideration 1,184 —
Capital improvements in accounts payable $ 442 $ 597
SILVER BAY REALTY TRUST CORP.
PORTFOLIO SUMMARY OF SINGLE-FAMILY
PROPERTIES
AS OF DECEMBER 31, 2016
Aggregate Investment
Average Investment
Number of in Real Estate in Real Estate
Average Age
Average Square
Market Properties (in thousands) Per
Property
(in years)(1)
Footage Atlanta 2,949 $ 351,910 $ 119,332 22.8 1,809 Phoenix
1,422 203,764 143,294 28.2 1,635 Tampa 1,136 164,859 145,122 28.5
1,622 Charlotte (2) 689 86,223 125,142 16.6 1,644 Orlando 522
71,283 136,557 28.8 1,501 Dallas 511 69,092 135,209 25.1 1,619
Jacksonville 451 59,680 132,328 28.4 1,536 Northern CA (3) 381
73,112 191,895 48.3 1,398 Las Vegas 290 41,409 142,790 20.7 1,717
Columbus 284 33,381 117,539 39.6 1,414 Tucson 209 17,685 84,617
44.0 1,330 Southeast FL (4) 200 37,425 187,125
50.0 1,349
Totals 9,044 $ 1,209,823 $
133,771 27.3 1,650 (1) As
of December 31, 2016, approximately 2% of the Company's properties
were less than 10 years old, 39% were between 10 and 20 years old,
20% were between 20 and 30 years old, 19% were between 30 and 40
years old, 11% were between 40 and 50 years old, and 9% were more
than 50 years old. Average age is an annual calculation. (2)
Charlotte market includes properties in South Carolina due to their
proximity to Charlotte, North Carolina. (3) Northern California
market currently consists of Contra Costa, Napa and Solano
counties. (4) Southeast Florida market currently consists of
Miami-Dade, Broward and Palm Beach counties.
SILVER BAY REALTY TRUST CORP.
FINANCIAL AND OPERATING RESULTS OF
AGGREGATE PORTFOLIO
(AMOUNTS IN THOUSANDS EXCEPT PROPERTY
AND PER HOME DATA)
The following table summarizes the
Company's aggregate portfolio financial results for the three
months and years ended ended December 31, 2016 and 2015:
Three Months Ended December 31, Year Ended
December 31, 2016 2015 2016
2015 Total revenue $ 32,450 $ 30,641 $ 126,635 $ 113,694
Property operating expenses: Property operating and maintenance
5,518 5,627 23,393 22,106 Real estate taxes 4,188 3,983 17,681
15,847 Homeowners’ association fees 407 447 1,665 1,912 Property
management 2,604 2,831 10,895 11,093
Total property operating expenses $ 12,717 $ 12,888 $
53,634 $ 50,958 NOI $ 19,733 $ 17,753 $ 73,001 $
62,905 Core NOI Margin 61.4 % 58.7 % 58.1 % 56.0 % Turnover 6.6 %
6.6 % 29.5 % 27.6 % Stabilized capital expenditures $ 1,652 $ 2,565
$ 7,630 $ 8,212 Stabilized capital expenditure per home $ 183 $ 284
$ 844 $ 910
The following table summarizes the occupancy status of the
Company's properties as of December 31, 2016:
Market Number ofProperties
PropertiesOccupied Properties Vacant
AggregatePortfolio Occupancy
Rate AverageMonthly Rent Atlanta
2,949 2,846 103 96.5 % $ 1,119 Phoenix 1,422 1,390 32 97.7 % 1,143
Tampa 1,136 1,089 47 95.9 % 1,347 Charlotte 689 667 22 96.8 % 1,113
Orlando 522 500 22 95.8 % 1,220 Dallas 511 494 17 96.7 % 1,336
Jacksonville 451 437 14 96.9 % 1,175 Northern CA 381 373 8 97.9 %
1,734 Las Vegas 290 288 2 99.3 % 1,229 Columbus 284 278 6 97.9 %
1,099 Tucson 209 203 6 97.1 % 855 Southeast FL 200 184
16 92.0 % 1,606
Totals 9,044 8,749
295 96.7 % $ 1,205
SILVER BAY REALTY TRUST CORP.
FINANCIAL AND OPERATING RESULTS OF
SAME-HOME PORTFOLIO
(AMOUNTS IN THOUSANDS EXCEPT PROPERTY
AND PER HOME DATA)
The following table summarizes the
Company's Same-Home portfolio financial results of 5,780 properties
for the three months and years ended December 31, 2016 and
2015:
Three Months Ended December 31, Year Ended
December 31, 2016 2015 2016
2015 Same-Home total revenue $ 21,622 $ 20,415 $ 85,162 $
80,652 Same-Home property operating expenses: Property operating
and maintenance 3,828 4,048 16,399 16,249 Real estate taxes 2,733
2,727 11,846 11,079 Homeowners' association fees 316 341 1,263
1,516 Property management 1,737 1,846 7,253
7,785 Same-Home property operating expenses 8,614
8,962 36,761 36,629 Same-Home NOI $ 13,008
$ 11,453 $ 48,401 $ 44,023 Same-Home
Core NOI Margin 60.7 % 56.8 % 57.3 % 55.2 %
The following table summarizes the Company's Same-Home portfolio
financial results, by quarter, for the trailing five quarters ended
December 31, 2016:
Three Months Ended December 31,
September 30, June 30, March 31,
December 31, 2016 2016 2016
2016 2015 Same-Home total revenue $ 21,622 $ 21,426 $
21,246 $ 20,868 $ 20,415 Same-Home property operating expenses:
Property operating and maintenance 3,828 4,459 3,990 4,122 4,048
Real estate taxes 2,733 3,091 3,024 2,998 2,727 Homeowners'
association fees 316 301 319 327 341 Property management 1,737
1,849 1,836 1,831 1,846
Same-Home property operating expenses 8,614 9,700
9,169 9,278 8,962 Same-Home NOI $ 13,008
$ 11,726 $ 12,077 $ 11,590 $ 11,453
Same-Home Core NOI Margin 60.7 % 55.3 % 57.2 % 56.1 % 56.8 %
Same-Home turnover 6.9 % 8.0 % 7.6 % 6.4 % 7.2 % Days from move-out
to move-in 41 35 38 52 54 Same-Home capital expenditures $ 1,160 $
1,340 $ 1,639 $ 1,400 $ 1,791 Same-Home capital expenditures per
home $ 201 $ 232 $ 284 $ 242 $ 310
SILVER BAY REALTY
TRUST CORP. FINANCIAL AND OPERATING RESULTS OF SAME-HOME
PORTFOLIO (AMOUNTS IN THOUSANDS EXCEPT PROPERTY AND PER HOME
DATA)
The following table summarizes the
occupancy status of the Company's Same-Home portfolio as of
December 31, 2016 and 2015:
Aggregate Occupancy Rate Average
Monthly Rent Number of Same-Home December 31,
December 31, December 31, December
31, Properties 2016 2015
2016 2015 % Change Atlanta 1,050 96.4 % 95.9 %
$ 1,243 $ 1,192 4.3 % Phoenix 1,422 97.7 % 94.6 % 1,143 1,101 3.8 %
Tampa 920 95.4 % 95.1 % 1,378 1,326 3.9 % Charlotte 143 95.8 % 97.9
% 1,249 1,194 4.6 % Orlando 280 96.4 % 97.5 % 1,322 1,265 4.5 %
Dallas 378 96.6 % 95.2 % 1,343 1,309 2.6 % Jacksonville 301 96.3 %
95.7 % 1,160 1,119 3.7 % Northern CA 381 97.9 % 97.4 % 1,734 1,610
7.7 % Las Vegas 290 99.3 % 98.3 % 1,229 1,189 3.4 % Columbus 284
97.9 % 97.2 % 1,099 1,072 2.5 % Tucson 209 97.1 % 95.7 % 855 844
1.3 % Southeast FL 122 88.5 % 90.2 % 1,634 1,589
2.8 %
Totals 5,780 96.7 % 95.7 % $ 1,264
$ 1,216 3.9 %
SILVER BAY REALTY TRUST CORP.
DEFINITIONS AND RECONCILIATIONS OF
FINANCIAL AND OPERATING MEASURES
(AMOUNTS IN THOUSANDS EXCEPT SHARE
DATA)
(UNAUDITED)
Aggregate Investment in Real Estate. Aggregate investment
in real estate includes all capitalized costs, determined in
accordance with GAAP, incurred through December 31, 2016 for
the acquisition, stabilization, and significant post-stabilization
renovation of properties, including land, building, possession
costs and renovation costs. Aggregate investment in real
estate includes $21.6 million in capital improvements, incurred
from the Company's formation through December 31, 2016, made
to properties that had been previously renovated, but does not
include accumulated depreciation.
Average Monthly Rent. Average monthly rent is calculated
as the average of the contracted monthly rent for occupied
properties for an identified population as of period end and
reflects rent concessions amortized over the life of the related
lease.
Core Net Operating Income Margin ("Core NOI Margin").
Core NOI Margin is calculated by dividing net operating income by
Core Revenue, which eliminates the impact of bad debt expense from
both total revenue and property operating expenses.
Core Revenue. Core Revenue is calculated by subtracting
bad debt expense from total revenue.
Days from Move-Out to Move-In. Days from move-out to
move-in represents the number of days from past resident move-out
date until a new resident moves into the same property.
Funds From Operations and Core Funds From Operations.
Funds from operations ("FFO") is a non-GAAP financial measure that
the Company believes, when considered with the financial statements
determined in accordance with GAAP, is helpful to investors in
understanding its performance because it captures features
particular to real estate performance by recognizing that real
estate generally appreciates over time or maintains residual value
to a much greater extent than do other depreciable assets. The
National Association of Real Estate Investment Trusts ("NAREIT")
defines FFO as net income (loss), computed in accordance with GAAP,
excluding gains or losses from sales of, and impairment losses
recognized with respect to, depreciable property, plus depreciation
and amortization, and after adjustments for unconsolidated
partnerships and joint ventures. Adjustments for unconsolidated
partnerships and joint ventures are calculated on the same basis to
determine FFO. In addition, the Company has adjusted net income
(loss) for the income tax expense (benefit) on disposition of real
estate.
Core funds from operations ("Core FFO") is a non-GAAP financial
measure that the Company uses as a supplemental measure of its
performance. The Company believes that Core FFO is further helpful
to investors as it provides a more consistent measurement of its
performance across reporting periods by removing the impact of
certain items that are not comparable from period to period. The
Company adjusts FFO for expensed acquisition fees and costs,
share-based compensation, severance and other, market ready costs
prior to initial lease, write off expenses associated with changes
in our debt structure, adjustments for derivative instruments, net,
and certain other non-cash or non-comparable costs to arrive at
Core FFO.
FFO and Core FFO should not be considered alternatives to net
income (loss) or net cash flows from operating activities, as
determined in accordance with GAAP, as indications of the Company's
performance or as measures of liquidity. These non-GAAP measures
are not necessarily indicative of cash available to fund future
cash needs. In addition, although the Company uses these non-GAAP
measures for comparability in assessing its performance against
other REITs, not all REITs compute these non-GAAP measures in the
same manner. Accordingly, there can be no assurance that the
Company's basis for computing these non-GAAP measures is comparable
with that of other REITs. This is due in part to the differences in
capitalization policies used by different companies and the
significant effect these capitalization policies have on FFO and
Core FFO. Real estate costs incurred in connection with real estate
operations which are accounted for as capital improvements are
added to the carrying value of the property and depreciated over
time, whereas real estate costs that are expenses are accounted for
as a current period expense. This impacts FFO and Core FFO
because costs that are accounted for as expenses reduce FFO and
Core FFO. Conversely, real estate costs associated with assets
that are capitalized and then subsequently depreciated are excluded
from the calculation of FFO and Core FFO.
FFO and Core FFO are calculated on a gross basis and, as such,
do not reflect adjustments for the noncontrolling interests -
Operating Partnership.
The following table sets forth a reconciliation of the Company's
net income (loss) as determined in accordance with GAAP and its
calculations of FFO and Core FFO for the three months and years
ended December 31, 2016 and 2015. Also presented is
information regarding the computation of FFO per share and Core FFO
per share (amounts in thousands, except share and per share
amounts):
Three Months Ended December 31, Year Ended
December 31, 2016 2015 2016
2015 Net income (loss) $ 2,862 $ (798 ) $ (2,614 ) $ (9,952
) Depreciation and amortization 9,353 10,115 37,291 35,189 Net gain
on disposition of real estate (4,499 ) (1,724 ) (10,657 ) (4,044 )
Impairment on real estate 601 49 1,105 95 Income tax expense
(benefit) on disposition of real estate (192 ) (941 ) 623 (941 )
Other income — — — (285 ) FFO 8,125 6,701
25,748 20,062 Adjustments: Portfolio acquisition expense (1)
403 18 526 2,064 Share-based compensation 658 718 2,667 2,613
Severance and other — — 1,977 — Market ready costs prior to initial
lease and other — — — 169 Write-off of deferred financing fees — —
— 31 Adjustments for derivative instruments, net (157 ) 51 (44 ) 51
Amortization of discount on securitization loan 76 76 301 301 Other
expense (2) (33 ) — — 114 Core FFO $ 9,072
$ 7,564 $ 31,175 $ 25,405 FFO $
8,125 $ 6,701 $ 25,748 $ 20,062 Preferred stock distributions (25 )
(25 ) (100 ) (100 ) FFO available to common shares and units $
8,100 $ 6,676 $ 25,648 $ 19,962
Core FFO $ 9,072 $ 7,564 $ 31,175 $ 25,405 Preferred stock
distributions (25 ) (25 ) (100 ) (100 ) Core FFO available to
common shares and units $ 9,047 $ 7,539 $ 31,075
$ 25,305 Weighted average common shares and
units outstanding (3)(4) 37,758,743 38,300,709
37,891,605 38,441,510 FFO per share $ 0.21 $
0.17 $ 0.68 $ 0.52 Core FFO per share $ 0.24
$ 0.20 $ 0.82 $ 0.66 (1)
Portfolio acquisition expense represents transaction costs incurred
when acquiring properties that meet the definition of a business
under the guidance codified in Codification Topic, Business
Combinations ("ASC 805"), which must be expensed when incurred
rather than capitalized into the basis of each property. (2)
Non-comparable costs from prior periods. (3) Represents the
weighted average of common shares and common units in the Operating
Partnership outstanding for the periods presented. (4) Includes the
effect of dilutive securities attributable to certain stock based
awards meeting market conditions during the three months and year
ended December 31, 2016.
FFO per share and Core FFO per share. FFO and Core FFO
shares represents FFO and Core FFO divided by the weighted average
of common shares and common units in the Operating Partnership for
the periods presented and the effect of dilutive securities
attributable to certain performance-based stock awards during
periods when the performance conditions required under such
performance awards are on pace to be achieved.
Generally Accepted Accounting Principles ("GAAP"). GAAP
is defined in accordance with accounting principles generally
accepted in the United States.
Net Operating Income and Same-Home Net Operating Income.
The Company defines net operating income ("NOI") as total revenue
less property operating and maintenance, real estate taxes,
homeowners’ association fees, and property management expenses. NOI
excludes depreciation and amortization, portfolio acquisition
expense, general and administrative expenses, share-based
compensation, severance and other, interest expense, impairment of
real estate, net gain on disposition of real estate, adjustments
for derivative instruments, net, income tax expense (benefit), net
and other non-comparable items as applicable. The Company considers
NOI to be a meaningful financial measure when considered with the
financial statements determined in accordance with GAAP. The
Company believes NOI is helpful to investors in understanding the
core performance of its real estate operations without regard to
items excluded from the calculation of such measure, which can vary
substantially from company to company depending upon accounting
methods, book value of assets, capital structure and the method by
which assets were acquired, among other factors.
The Company believes Same-Home NOI is a useful measure of
performance because the population of properties in this analysis
is consistent from period to period, thereby eliminating the
effects of changes in the composition of the portfolio.
The following is a reconciliation of NOI and Same-Home NOI to
net loss as determined in accordance with GAAP for the years ended
December 31, 2016 and 2015 (amounts in thousands):
Year Ended December 31, 2016
2015 Net loss $ (2,614 ) $ (9,952 ) Depreciation and
amortization 37,291 35,189 Portfolio acquisition expense 526 2,064
General and administrative 14,457 15,915 Share-based compensation
2,667 2,613 Severance and other 1,977 — Interest expense 26,113
21,275 Impairment of real estate 1,105 95 Net gain on disposition
of real estate (10,657 ) (4,044 ) Adjustments for derivative
instruments, net (44 ) 51 Other expense 1,211 288 Income tax
expense (benefit), net 969 (758 ) Property operating and
maintenance add back: Market ready costs prior to initial lease and
other — 169 NOI 73,001 62,905 Less non-Same-Home
Total revenue (41,473 ) (33,042 ) Property operating expenses
16,873 14,160 Same-Home NOI $ 48,401 $ 44,023
Calculation of aggregate Core NOI Margin Total
revenue $ 126,635 $ 113,694 Less bad debt expense (1,002 ) (1,426 )
Core Revenue $ 125,633 $ 112,268 Core NOI Margin 58.1
% 56.0 % Calculation of Same-Home Core NOI Margin Same-Home
total revenue $ 85,162 $ 80,652 Less Same-Home bad debt expense
(742 ) (959 ) Same-Home Core Revenue $ 84,420 $ 79,693
Same-Home Core NOI Margin 57.3 % 55.2 %
The following is a reconciliation of NOI and Same-Home NOI to
net income (loss) as determined in accordance with GAAP, by
quarter, for the trailing five quarters ended December 31,
2016 (amounts in thousands):
Three Months Ended December 31,
September 30,
June 30,
March
31,
December 31, 2016 2016 2016
2016 2015 Net income (loss) $ 2,862 $ (1,665 ) $ (222
) $ (3,589 ) $ (798 ) Depreciation and amortization 9,353 9,243
9,329 9,366 10,115 Portfolio acquisition expense 403 123 — — 18
General and administrative 3,353 3,514 3,737 3,853 3,991
Share-based compensation 658 661 776 572 718 Severance and other —
310 — 1,667 — Interest expense 7,020 6,589 6,292 6,212 5,968
Impairment of real estate 601 255 190 59 49 Net gain on disposition
of real estate (4,499 ) (2,417 ) (2,456 ) (1,285 ) (1,724 )
Adjustments for derivative instruments, net (157 ) 113 — — 51 Other
expense 272 398 270 271 270 Income tax (benefit) expense, net (133
) 424 211 467 (905 ) NOI 19,733 17,548 18,127
17,593 17,753 Less non-Same-Home Total revenue (10,828 ) (10,135 )
(10,242 ) (10,268 ) (10,226 ) Property operating expenses 4,103
4,313 4,192 4,265 3,926
Same-Home NOI $ 13,008 $ 11,726 $ 12,077 $
11,590 $ 11,453 Calculation of aggregate Core
NOI Margin Total revenue $ 32,450 $ 31,561 $ 31,488 $ 31,136 $
30,641 Less bad debt expense (328 ) (269 ) (132 ) (273 ) (405 )
Core Revenue $ 32,122 $ 31,292 $ 31,356 $
30,863 $ 30,236 Core NOI Margin 61.4 % 56.1 % 57.8 %
57.0 % 58.7 % Calculation of Same-Home Core NOI Margin
Same-Home total revenue $ 21,622 $ 21,426 $ 21,246 $ 20,868 $
20,415 Less Same-Home bad debt expense (205 ) (218 ) (117 ) (202 )
(262 ) Same-Home Core Revenue $ 21,417 $ 21,208 $
21,129 $ 20,666 $ 20,153 Same-Home Core NOI
Margin 60.7 % 55.3 % 57.2 % 56.1 % 56.8 %
Neither NOI nor Same-Home NOI should be considered an
alternative to net income (loss) or net cash flows from operating
activities, as determined in accordance with GAAP, as indications
of its performance or as measures of liquidity. Although the
Company uses these non-GAAP measures for comparability in assessing
its performance against other REITs, not all REITs compute these
non-GAAP measures in the same manner. Accordingly, there can be no
assurance that the basis for computing these non-GAAP measures is
comparable with that of other REITs.
Occupancy. Occupancy is defined as the number of occupied
properties for an identified population as of the last day of the
period divided by the comparative property set.
Retention Rate. Retention rate refers to the number of
residents the Company retains from an identified group of
properties with lease expirations (including month-to-month leases)
in a specified period. Retention rate is calculated by dividing the
number of residents in such an identified pool that remain in our
properties by the total number of properties in such pool.
Same-Home Properties. The Company defines Same-Home
properties as those properties (1) that it had stabilized and for
which it had completed the initial renovation as of January 1, 2015
and (2) that it held in operations throughout the full periods
presented in both 2015 and 2016. Same-Home properties exclude
properties classified as held for sale and properties taken out of
service as a result of a casualty loss.
Stabilized Property. The Company considers a property
stabilized at the earlier of (1) its first authorized occupancy or
(2) 90 days after the renovations for such property are complete,
regardless of whether the property is leased. Properties acquired
with in-place leases are considered stabilized even though such
properties require a future initial renovation to meet the
Company's standards and may have existing residents who would not
otherwise meet the resident screening requirements.
Total Properties. Total properties exclude properties
reflected as assets held for sale on the Company's condensed
consolidated balance sheets.
Turnover Rate. Turnover rate is defined as the number of
instances that properties in an identified pool become un-occupied
over a specific period of time, divided by the number of properties
in stabilized status in such identified population.
Weighted Average Common Shares and Units Outstanding.
Below is a reconciliation from the Company's weighted average
shares outstanding for net income and FFO and Core FFO
purposes:
Three Months Ended December 31, Year Ended
December 31, 2016 2015 2016
2015 Weighted average common shares outstanding - basic
35,380,056 36,069,198 35,557,636 36,209,999 Operating Partnership
units (1) 2,231,511 2,231,511 2,231,511 2,231,511 Performance-based
stock awards (2) 147,176 — 102,458 — Total
common shares and units - diluted 37,758,743 38,300,709
37,891,605 38,441,510 (1) Represents the
weighted average of common shares and common units in the Operating
Partnership outstanding for the periods presented. (2) Includes the
effect of dilutive securities attributable to certain stock based
awards meeting market conditions during the three months and year
ended December 31, 2016.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170227006533/en/
Silver Bay Realty Trust Corp.Griffin Wetmore,
952-358-4400Executive Vice President of
Financeinvestors@silverbaymgmt.com
Silver Bay Realty Trust Corp. (NYSE:SBY)
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