– Provides COVID-19 Business Update
–
Seritage Growth Properties (NYSE: SRG) (the “Company”), a
national owner of 199 retail and mixed-use properties totaling
approximately 31.6 million square feet of gross leasable area
(“GLA”), today reported financial and operating results for the
three and six months ended June 30, 2020, and provided a business
update in light of the ongoing COVID-19 pandemic.
Summary Financial
Results
For the three months ended June 30, 2020:
- Net loss attributable to common shareholders of $1.2 million,
or $0.03 per share
- Total Net Operating Income (“Total NOI”) of $7.3 million
- Funds from Operations (“FFO”) of ($27.4) million, or ($0.49)
per share
- Company FFO of ($27.2) million, or ($0.49) per share
For the six months ended June 30, 2020:
- Net loss attributable to common shareholders of $23.0 million,
or $0.61 per share
- Total NOI of $23.1 million
- FFO of ($44.9) million, or ($0.80) per share
- Company FFO of ($45.6) million, or ($0.82) per share
COVID-19 Business Update
As of August 4, 2020:
- Approximately 93% of in-place tenants (representing 92% of
leased GLA and 86% of annual base rent) were open and/or operating,
including 239 stores that were fully open and 19 stores that were
open for pick-up and/or delivery;
- Collected 66% of Q2 2020 rental income, and agreed to defer an
additional 21%, from tenants other than Sears;
- Collected 74% of July 2020 rental income, and agreed to defer
an additional 7%, from tenants other than Sears;
- Sold 13 assets and five outparcels for gross proceeds of $166.3
million year to date; and
- Had assets under contract for sale representing anticipated
gross proceeds of $91.5 million, subject to buyer diligence and
closing conditions.
During the three months ended June 30, 2020:
- Sold nine properties and three outparcels for gross proceeds of
$98.6 million and recorded gains totaling $53.9 million; and
- Restarted components of select suburban retail redevelopment
projects representing a potential investment of approximately $42.7
million and potential annual rental income of approximately $12.7
million over the next 6-12 months, subject to tenant opening
schedules. The majority of previously announced redevelopment
projects remain on hold.
“As we start the month of August, approximately 93% of our
in-place tenants are fully or partially open as we continue to
benefit from the breadth of our tenant roster and diversification
across geographic markets. To date, we have collected 66% of second
quarter rents and signed agreements to defer an additional 21%. To
partially offset this near term disruption in income, we executed
on our cost savings initiatives to reduce corporate and property
operating expenses,” said Benjamin Schall, President and Chief
Executive Officer. “We made consistent progress on our asset
disposition program and completed sales in excess of our goal for
the second quarter. Year to date, we have sold approximately $166
million of assets, including $100 million since the onset of the
pandemic. Our diverse asset base continues to be of interest to a
range of prospective buyers and we currently have an additional $92
million of dispositions under contract. These disposition
activities allow us to realize value today, generate liquidity and
narrow our focus to a smaller set of prioritized assets and
redevelopment opportunities. Since inception, we have reduced our
holdings from 266 to 199 assets and generated $860 million in
proceeds through asset monetization activities.”
Mr. Schall continued, “As we look ahead, we will remain
selective in our near term capital expenditures, with the majority
of our previously underway projects remaining on pause. In addition
to limited landlord and infrastructure work at our premier and
mixed-use projects, we are advancing suburban retail projects that
provide the opportunity to bring online approximately $13 million
of rent over the next 6-12 months with an additional investment of
approximately $43 million. For the remaining projects that were
previously underway, we continue to work with tenants to preserve
signed leases as we determine necessary project modifications and
update schedules. Over the coming months, our focus remains on the
health and safety of our team and communities, making the necessary
adjustments to reflect the uncertain economic environment, and
advancing the medium and long-term value of our assets and
platform.”
Operating Results
Leasing
During the three months ended June 30, 2020, the Company signed
new leases totaling 97,000 square feet at an average base rent of
$18.84 PSF. On a same-space basis, new rents averaged 3.3x prior
rents for space formerly occupied by Sears or Kmart, increasing to
$18.89 PSF for new tenants compared to $5.66 PSF paid by Sears or
Kmart across 95,000 square feet.
Below is a summary of the Company’s leasing activity, including
its proportional share of unconsolidated joint ventures, for the
three and six months ended June 30, 2020 and since the Company’s
inception in July 2015:
(in thousands, except PSF
amounts)
Since
Q2 2020
FY2020
Inception
Leases
6
18
420
Square feet
97,000
221,000
10,648,000
Annual base rent ($000s)
$
1,823
$
4,558
$
184,326
Annual base rent PSF (1)
$
18.84
$
20.60
$
18.35
Re-leasing multiple (1)(2)
3.3
x
3.5
x
4.0
x
(1)
Excludes certain self storage,
medical office, auto-related and ground leases.
(2)
Excludes densification square
footage (e.g. new outparcel developments) and backfill of vacant
space not previously occupied by Sears or Kmart.
The table below provides a summary of all the Company’s signed
leases as of June 30, 2020, including unconsolidated joint ventures
presented at the Company’s proportional share:
(in thousands except number of
leases and PSF data)
Number of
Leased
% of Total
Annual Base
% of
Tenant
Leases
GLA
Leased GLA
Rent ("ABR")
Total ABR
ABR PSF
In-place diversified leases
277
6,517
61.4
%
$
97,393
55.9
%
$
14.94
SNO diversified leases (1)
160
3,361
31.7
%
71,692
41.2
%
21.33
Total diversified leases
437
9,878
93.1
%
$
169,085
97.1
%
$
17.12
Sears or Kmart (2)
7
729
6.9
%
5,138
2.9
%
7.05
Total
444
10,607
100.0
%
$
174,223
100.0
%
$
16.43
(1)
SNO = signed not yet opened
leases.
(2)
Includes five properties subject
to a master lease (the “Holdco Master Lease”) between the Company
and affiliates of Transform Holdco LLC (“Holdco”), an affiliate of
ESL Investments, Inc. (after giving effect to the pending
termination of the Holdco Master Lease at 12 properties), and two
leases between the Company’s unconsolidated joint ventures and
Holdco.
Development
During the three months ended June 30, 2020, the Company
restarted components of select suburban retail redevelopment
projects, including certain spaces previously delivered to tenants,
representing a potential investment of approximately $42.7 million
and potential annual rental income of approximately $12.7 million
over the next 6-12 months, subject to tenant opening schedules.
Including these restarted projects, and excluding any assets
that have been sold, the Company estimates it will have invested
approximately $796.2 million in suburban retail redevelopment
projects that are expected to generate approximately $79.2 million
of annual rental income, of which $66.5 million is derived from
currently in-place leases and $12.7 million is derived from SNO
leases related to the restarted project activity.
The remainder of the Company’s previously announced suburban
retail redevelopment projects, totaling $400-450 million of
potential capital investment, remain on hold due to the COVID-19
pandemic and the direct impacts on the Company’s business. The
Company deems this approach to capital deployment prudent given the
uncertainty regarding tenants’ ability to construct and open new
stores and the feasibility of sustaining labor levels with safe
working conditions, as well as the risk to future rent collections
and asset sales, the latter of which has been a meaningful source
of capital for the Company’s development program.
The Company is performing limited non-tenant construction
activity at select properties, including its previously underway
premier projects, and working with tenants to preserve signed
leases and modify schedules for project completion and store
openings.
Additionally, the Company is working with its development
partners to obtain project financing and reassess construction
schedules for its three previously announced multifamily projects,
each of which represents the first phase of larger, mixed-use
developments.
Transactions
During the three months ended June 30, 2020, the Company
completed the sale of nine properties and three outparcels totaling
1.2 million square feet and $98.6 million of gross proceeds.
Total asset sales for the six months ended June 30, 2020
consisted of 13 properties and three outparcels totaling 1.7
million square feet and $158.9 million of gross proceeds.
Approximately $136.2 million of the gross proceeds were from the
sale of income-producing properties sold at a blended cap rate of
5.9%. The remaining $22.7 million of gross proceeds were derived
from smaller market assets sold at approximately $40 PSF.
Subsequent to June 30, 2020, the Company sold two outparcels for
$7.3 million and, as of August 4, 2020, the Company had assets
under contract for sale representing anticipated gross proceeds of
$91.5 million, subject to buyer diligence and closing
conditions.
Since it began its capital recycling program in July 2017, the
Company has raised over $860 million of gross cash proceeds from
the sale or joint venture of interests in 78 properties, plus
outparcels at several properties, and reinvested the majority of
the proceeds into its redevelopment pipeline.
Balance Sheet and Liquidity
As of June 30, 2020, the Company had cash on hand of $92.6
million, including $10.9 million of net proceeds from asset sales
that closed on June 30, 2020 and which are included in tenant and
other receivables on the Company’s balance sheet as of June 30,
2020.
As of August 4, 2020, the Company had closed asset sales
totaling $7.3 million during the third quarter and had additional
asset sales under contract for anticipated gross proceeds of $91.5
million, subject to buyer diligence and closing conditions. The
Company expects to use these sources of liquidity, together with a
combination of future sales of wholly-owned assets and joint
venture interests and/or potential credit and capital markets
transactions to fund its operations and select development
activity.
The availability of funding from sales of assets and credit or
capital markets transactions is subject to various conditions,
including the consent of the Company’s lender under its $2.0
billion term loan facility (the “Term Loan Facility”), and there
can be no assurance that such transactions will be consummated.
On May 5, 2020, the Company and Berkshire Hathaway, the
administrative agent and the lender under the Term Loan Facility,
entered into an amendment (the “Amendment”) to the agreement
governing the Term Loan Facility that permits the deferral of
interest payments based on the amount of Available Cash (as defined
in the Amendment) for each period. Additionally, the Amendment
provides that the administrative agent and the lenders express
their continued support for asset dispositions, subject to the
Administrative Agent’s right to approve the terms of individual
transactions due to the occurrence of a Financial Metric Trigger
Event, as such term is defined under the Term Loan Facility.
The Term Loan Facility includes a $400 million Incremental
Funding Facility, access to which is subject to rental income from
non-Sears Holdings tenants of at least $200 million, on an
annualized basis and after giving effect to SNO leases expected to
commence rent payment within 12 months, which the Company has not
yet achieved. The timing of the Company’s ability to access the
Incremental Funding Facility, if at all, will be adversely impacted
by the COVID-19 pandemic.
Dividends
On June 9, 2020, the Company’s Board of Trustees declared a
preferred stock dividend of $0.4375 per each Series A Preferred
Share. The preferred dividend was paid on July 15, 2020 to holders
of record on June 30, 2020.
The Company’s Board of Trustees does not expect to declare
dividends on its common shares in 2020 unless required to do so to
maintain REIT status.
Financial Results
Below is a summary of the Company’s financial results for the
three and six months ended June 30, 2020 and June 30, 2019:
(in thousands except per share
amounts)
Three Months Ended June
30,
Six Months Ended June
30,
2020
2019
2020
2019
Net loss attributable to Seritage
common shareholders
$
(1,153
)
$
(18,128
)
$
(23,042
)
$
(26,320
)
Net loss per diluted share
attributable to Seritage common shareholders
(0.03
)
(0.50
)
(0.61
)
(0.73
)
Total NOI
7,285
14,645
23,132
38,923
FFO
(27,387
)
(6,167
)
(44,944
)
(11,345
)
FFO per diluted share
(0.49
)
(0.11
)
(0.80
)
(0.20
)
Company FFO
(27,150
)
(6,062
)
(45,591
)
(11,122
)
Company FFO per diluted share
(0.49
)
(0.11
)
(0.82
)
(0.20
)
Net Loss
The decrease in net loss was driven primarily by an increase in
gains on sale of real estate, net, which were $52.1 million and
$72.9 million for the three and six months ended June 30, 2020,
respectively, as compared to $11.6 million and $32.9 million,
respectively, for the prior year periods.
Total NOI
The decrease in Total NOI was driven by (i) reduced rental
income under the Holdco Master Lease as a result of recapture and
termination activity at the Company’s properties, including its
unconsolidated joint venture properties and (ii) the recognition of
rental income deemed uncollectible of $3.3 million and $3.6 million
for the three and six months ended June 30, 2020, respectively.
Rental income deemed uncollectible includes amounts related to the
recent amendment to the Holdco Master Lease which resulted in the
termination of the Holdco Master Lease at 12 stores and deferred
rent at the five remaining stores, as well as to certain other
tenants subject to in-place leases.
FFO and Company FFO
The decrease in FFO was driven primarily by the same factors
driving the decreases in Total NOI, as well as (i) accelerated
amortization of straight-line rent receivables as a result of
termination activity under the Holdco Master Lease, (ii) the
reversal, during the three months ended June 30, 2020, of $4.7
million of previously recorded straight-line rent and (iii) lower
interest and other income as a result of maintaining lower cash
balances. The reversal of straight-line rent includes amounts
related to the recent amendment to the Holdco Master Lease which
resulted in the termination of the Holdco Master Lease at 12 stores
and deferred rent at the five remaining stores, as well as to
certain other tenants subject to in-place leases.
COVID-19 Pandemic
The COVID-19 pandemic continues to have a significant impact on
the retail, retail real estate and real estate development
industries in the United States, including the Company’s
properties. As of August 4, 2020, approximately 93% of the
Company’s in-place tenants (representing 92% of leased GLA and 86%
of ABR) were open and/or operating in some capacity and the Company
continues to work with tenants to collect rent, including
evaluating select rent deferral requests.
As of August 4, 2020, the Company had collected 66% of rental
income for the three months ended June 30, 2020, and agreed to
defer an additional 21%, from tenants other than Sears. As of
August 4, 2020, the Company had also collected 74% of July 2020
rental income, and agreed to defer an additional 7%, from tenants
other than Sears. While the Company intends to enforce its
contractual rights under its leases, there can be no assurance that
additional rental modification agreements will be reached or that
tenants will meet their future obligations.
The Company continues to advance its response to the COVID-19
pandemic with an emphasis on managing its cash resources and
preserving the value of its assets and its platform, including by
(i) negotiating rent deferral agreements with tenants, (ii)
negotiating extended payment terms with vendors and contractors,
(iii) amending its Term Loan Facility to provide for the potential
deferral of interest expense, (iv) monetizing certain assets and
(v) selectively allocating capital to restarting components of
previously announced redevelopment projects.
As a result of the rapid development, fluidity and uncertainty
surrounding this situation, the Company expects that these
conditions will change, potentially significantly, in future
periods and results for the three and six months ended June 30,
2020 may not be indicative of the impact of the COVID-19 pandemic
on the Company’s business for the third quarter of 2020 or for
future periods. As such, the Company cannot reasonably estimate the
impact of COVID-19 on its financial condition, results of
operations or cash flows over the foreseeable future.
Supplemental Report
A Supplemental Report will be available in the Investors section
of the Company’s website, www.seritage.com.
Non-GAAP Financial
Measures
The Company makes reference to NOI, Total NOI, FFO and Company
FFO which are financial measures that include adjustments to
accounting principles generally accepted in the United States
(“GAAP”).
None of NOI, Total NOI, FFO or Company FFO, are measures that
(i) represent cash flow from operations as defined by GAAP; (ii)
are indicative of cash available to fund all cash flow needs,
including the ability to make distributions; (iii) are alternatives
to cash flow as a measure of liquidity; or (iv) should be
considered alternatives to net income (which is determined in
accordance with GAAP) for purposes of evaluating the Company’s
operating performance. Reconciliations of these measures to the
respective GAAP measures we deem most comparable have been provided
in the tables accompanying this press release.
Net Operating Income ("NOI”) and Total
NOI
NOI is defined as income from property operations less property
operating expenses. The Company believes NOI provides useful
information regarding Seritage, its financial condition, and
results of operations because it reflects only those income and
expense items that are incurred at the property level.
The Company also uses Total NOI, which includes its proportional
share of unconsolidated properties. This form of presentation
offers insights into the financial performance and condition of the
Company as a whole given the Company’s ownership of unconsolidated
properties that are accounted for under GAAP using the equity
method.
The Company also considers NOI and Total NOI to be a helpful
supplemental measure of its operating performance because it
excludes from NOI variable items such as termination fee income, as
well as non-cash items such as straight-line rent and amortization
of lease intangibles.
Funds from Operations ("FFO") and Company
FFO
FFO is calculated in accordance with NAREIT which defines FFO as
net income computed in accordance with GAAP, excluding gains (or
losses) from property sales, real estate related depreciation and
amortization, and impairment charges on depreciable real estate
assets. The Company considers FFO a helpful supplemental measure of
the operating performance for equity REITs and a complement to GAAP
measures because it is a recognized measure of performance by the
real estate industry.
The Company makes certain adjustments to FFO, which it refers to
as Company FFO, to account for certain non-cash and non-comparable
items, such as termination fee income, unrealized loss on interest
rate cap, litigation charges, acquisition-related expenses,
amortization of deferred financing costs and certain
up-front-hiring costs, that it does not believe are representative
of ongoing operating results.
Forward-Looking
Statements
This document 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,
you 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 that are predictions
of or indicate future events or trends and that do not relate
solely to historical matters. Forward-looking statements involve
known and unknown risks, uncertainties, assumptions and
contingencies, many of which are beyond the company’s control,
which may cause actual results to differ significantly from those
expressed in any forward-looking statement. Factors that could
cause or contribute to such differences include, but are not
limited to: our historical exposure to Sears Holdings and the
effects of its previously announced bankruptcy filing; the
litigation filed against us and other defendants in the Sears
Holdings adversarial proceeding pending in bankruptcy court;
Holdco’s termination and other rights under its master lease with
us; competition in the real estate and retail industries; risks
relating to our recapture and redevelopment activities;
contingencies to the commencement of rent under leases; the terms
of our indebtedness; restrictions with which we are required to
comply in order to maintain REIT status and other legal
requirements to which we are subject; failure to achieve expected
occupancy and/or rent levels within the projected time frame or at
all; the impact of ongoing negative operating cash flow on our
ability to fund operations and ongoing development; our ability to
access or obtain sufficient sources of financing to fund our
liquidity needs; our relatively limited history as an operating
company; and the impact of the COVID-19 pandemic on the business of
our tenants and our business, income, cash flow, results of
operations, financial condition, liquidity, prospects, ability to
service our debt obligations and our ability to pay dividends and
other distributions to our shareholders. For additional discussion
of these and other applicable risks, assumptions and uncertainties,
see the “Risk Factors” and forward-looking statement disclosure
contained in our filings with the Securities and Exchange
Commission, including the risk factors relating to Sears Holdings
and Holdco. While we believe that our forecasts and assumptions are
reasonable, we caution that actual results may differ materially.
We intend the forward-looking statements to speak only as of the
time made and do not undertake to update or revise them as more
information becomes available, except as required by law.
About Seritage Growth
Properties
Seritage Growth Properties is a publicly-traded,
self-administered and self-managed REIT with 171 wholly-owned
properties and 28 joint venture properties totaling approximately
31.6 million square feet of space across 44 states and Puerto Rico.
The Company was formed to unlock the underlying real estate value
of a high-quality retail portfolio it acquired from Sears Holdings
in July 2015. The Company’s mission is to create and own
revitalized shopping, dining, entertainment and mixed-use
destinations that provide enriched experiences for consumers and
local communities, and create long-term value for our
shareholders.
SERITAGE GROWTH
PROPERTIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
and per share amounts)
(Unaudited)
June 30, 2020
December 31, 2019
ASSETS
Investment in real estate
Land
$
633,287
$
667,004
Buildings and improvements
1,128,051
1,112,653
Accumulated depreciation
(136,518
)
(147,696
)
1,624,820
1,631,961
Construction in progress
424,700
338,672
Net investment in real estate
2,049,520
1,970,633
Real estate held for sale
3,204
5,275
Investment in unconsolidated
joint ventures
485,333
445,077
Cash and cash equivalents
81,675
139,260
Tenant and other receivables,
net
65,278
54,470
Lease intangible assets, net
31,950
68,153
Prepaid expenses, deferred
expenses and other assets, net
61,977
67,744
Total assets
$
2,778,937
$
2,750,612
LIABILITIES AND EQUITY
Liabilities
Term Loan Facility, net
$
1,598,698
$
1,598,487
Accounts payable, accrued
expenses and other liabilities
168,277
108,755
Total liabilities
1,766,975
1,707,242
Commitments and contingencies
Shareholders' Equity
Class A common shares $0.01 par
value; 100,000,000 shares authorized; 38,644,689 and 36,897,364
shares issued and outstanding as of June 30, 2020 and December 31,
2019, respectively
386
369
Class B common shares $0.01 par
value; 5,000,000 shares authorized; 0 and 1,242,536 shares issued
and outstanding as of June 30, 2020 and December 31, 2019,
respectively
—
12
Series A preferred shares $0.01
par value; 10,000,000 shares authorized; 2,800,000 shares issued
and outstanding as of June 30, 2020 and December 31, 2019;
liquidation preference of $70,000
28
28
Additional paid-in capital
1,178,268
1,149,721
Accumulated deficit
(441,753
)
(418,711
)
Total shareholders' equity
736,929
731,419
Non-controlling interests
275,033
311,951
Total equity
1,011,962
1,043,370
Total liabilities and equity
$
2,778,937
$
2,750,612
SERITAGE GROWTH
PROPERTIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except per
share amounts)
(Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2020
2019
2020
2019
REVENUE
Rental income
$
21,648
$
38,697
$
54,758
$
82,275
Management and other fee
income
171
1,814
378
2,096
Total revenue
21,819
40,511
55,136
84,371
EXPENSES
Property operating
8,697
9,302
18,998
19,539
Real estate taxes
9,384
10,159
18,609
20,351
Depreciation and amortization
23,702
20,194
57,799
46,410
General and administrative
8,644
8,297
18,064
18,056
Total expenses
50,427
47,952
113,470
104,356
Gain on sale of real estate,
net
52,064
11,612
72,852
32,873
Equity in loss of unconsolidated
joint ventures
(1,322
)
(9,944
)
(2,216
)
(8,722
)
Interest and other income
141
2,175
474
4,773
Interest expense
(22,145
)
(22,141
)
(43,658
)
(45,595
)
Income (loss) before taxes
130
(25,739
)
(30,882
)
(36,656
)
Provision for taxes
(26
)
(146
)
11
(123
)
Net income (loss)
104
(25,885
)
(30,871
)
(36,779
)
Net (income) loss attributable to
non-controlling interests
(32
)
8,982
10,279
12,909
Net income (loss) attributable to
Seritage
$
72
$
(16,903
)
$
(20,592
)
$
(23,870
)
Preferred dividends
(1,225
)
(1,225
)
(2,450
)
(2,450
)
Net loss attributable to Seritage
common shareholders
$
(1,153
)
$
(18,128
)
$
(23,042
)
$
(26,320
)
Net loss per share attributable
to Seritage Class A and Class C common shareholders - Basic
$
(0.03
)
$
(0.50
)
$
(0.61
)
$
(0.73
)
Net loss per share attributable
to Seritage Class A and Class C common shareholders - Diluted
$
(0.03
)
$
(0.50
)
$
(0.61
)
$
(0.73
)
Weighted average Class A and
Class C common shares outstanding - Basic
38,634
36,291
37,933
35,983
Weighted average Class A and
Class C common shares outstanding - Diluted
38,634
36,291
37,933
35,983
Reconciliation of Net Loss to NOI and
Total NOI (in thousands)
Three Months Ended June
30,
Six Months Ended June
30,
NOI and Total NOI
2020
2019
2020
2019
Net income (loss)
$
104
$
(25,885
)
$
(30,871
)
$
(36,779
)
Termination fee income
—
—
(990
)
—
Management and other fee
income
(171
)
(1,814
)
(378
)
(2,096
)
Depreciation and amortization
23,702
20,194
57,799
46,410
General and administrative
expenses
8,644
8,297
18,064
18,056
Equity in loss of
unconsolidated
joint ventures
1,322
9,944
2,216
8,722
Gain on sale of real estate
(52,064
)
(11,612
)
(72,852
)
(32,873
)
Interest and other income
(141
)
(2,175
)
(474
)
(4,773
)
Interest expense
22,145
22,141
43,658
45,595
Provision for income taxes
26
146
(11
)
123
Straight-line rent
2,694
(5,609
)
5,395
(8,964
)
Above/below market rental
income/expense
(39
)
(143
)
(136
)
(247
)
NOI
$
6,222
$
13,484
$
21,420
$
33,174
Unconsolidated joint ventures
NOI (before adjustments)
1,514
2,849
2,816
7,159
Straight-line rent
(100
)
(314
)
(271
)
61
Above/below market rental
income/expense
(58
)
(1,374
)
(540
)
(1,471
)
Termination fee income
(293
)
—
(293
)
—
Total NOI
$
7,285
$
14,645
$
23,132
$
38,923
Reconciliation of Net Loss to FFO and
Company FFO (in thousands)
Three Months Ended June
30,
Six Months Ended June
30,
FFO and Company FFO
2020
2019
2020
2019
Net income (loss)
$
104
$
(25,885
)
$
(30,871
)
$
(36,779
)
Real estate depreciation and
amortization (consolidated properties)
23,201
19,800
56,788
45,375
Real estate depreciation and
amortization (unconsolidated joint ventures)
2,597
12,755
4,441
15,382
Gain on sale of real estate
(52,064
)
(11,612
)
(72,852
)
(32,873
)
Dividends on preferred shares
(1,225
)
(1,225
)
(2,450
)
(2,450
)
FFO attributable to common
shareholders and unitholders
$
(27,387
)
$
(6,167
)
$
(44,944
)
$
(11,345
)
Termination fee income
—
—
(990
)
—
Termination fee income
(unconsolidated joint ventures)
(293
)
—
(293
)
—
Amortization of deferred
financing costs
105
105
211
223
Severance costs
425
—
425
—
Company FFO attributable to
common shareholders and unitholders
$
(27,150
)
$
(6,062
)
$
(45,591
)
$
(11,122
)
FFO per diluted common share and
unit
$
(0.49
)
$
(0.11
)
$
(0.80
)
$
(0.20
)
Company FFO per diluted common
share and unit
$
(0.49
)
$
(0.11
)
$
(0.82
)
$
(0.20
)
Weighted Average Common Shares
and Units Outstanding
Weighted average common shares
outstanding
38,634
36,291
37,933
35,983
Weighted average OP units
outstanding
17,255
19,515
17,916
19,815
Weighted average common shares
and units outstanding
55,889
55,806
55,849
55,798
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200806006028/en/
Seritage Growth Properties 646-277-1268 IR@Seritage.com
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