Alexandria Real Estate Equities, Inc. Reports Third Quarter 2009 Operating and Financial Results
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PASADENA, Calif., Nov. 5 /PRNewswire-FirstCall/ --
Highlights
Third Quarter 2009:
-- Third Quarter 2009 Funds from Operations Per Share (Diluted)
Attributable to Alexandria Real Estate Equities, Inc.'s Common
Stockholders of $1.13
-- Third Quarter 2009 Earnings Per Share (Diluted) Attributable to
Alexandria Real Estate Equities, Inc.'s Common Stockholders of $0.47
-- Third Quarter 2009 GAAP Same Property Revenues Less Operating Expenses
Up 1%; Nine Months Ended September 30, 2009 GAAP Same Property Revenues
Less Operating Expenses Up 4%
-- Executed 29 Leases for 450,000 Rentable Square Feet; Nine Months Ended
September 30, 2009 Executed 108 Leases for 1,349,000 Rentable Square
Feet
-- Third Quarter 2009 GAAP Rental Rate Increase of 5.6% on Renewed/Released
Space
-- Third Quarter Occupancy Remains Relatively Steady at 94.4%
-- Operating Margins at 73%
-- Reduced $104 Million of Secured Debt Obligations
-- Entered into 15-Year Lease with Eli Lilly and Company as Anchor Tenant
at Alexandria Center for Life Science at East River Science Park -
NYC(TM)
-- Closed Follow-on Common Stock Offering with Net Proceeds of $233 Million
-- Completed Ground-Up Development of One Property at Mission Bay, San
Francisco Aggregating 102,000 Rentable Square Feet Pursuant to a 15-Year
Lease with Pfizer Inc.
-- As of September 30, 2009, Four Properties Aggregating 269,196 Rentable
Square Feet Were Under Contract, LOI or Under Negotiation and Were
Classified as "Held for Sale"
October 2009:
-- Closed 10-Year Secured Loan for $120 Million
-- Sold One Property Previously Classified as "Held For Sale" to a Life
Science User
Alexandria Real Estate Equities, Inc. (NYSE: ARE) today announced operating and financial results for the third quarter ended September 30, 2009.
For the third quarter of 2009, we reported funds from operations ("FFO") attributable to Alexandria Real Estate Equities, Inc.'s common stockholders of $50,609,000, or $1.13 per share (diluted), compared to FFO attributable to Alexandria Real Estate Equities, Inc.'s common stockholders of $46,273,000, or $1.45 per share (diluted), for the third quarter of 2008. Comparing the third quarter of 2009 to the third quarter of 2008, FFO attributable to Alexandria Real Estate Equities, Inc.'s common stockholders increased 9% and FFO per share (diluted) attributable to Alexandria Real Estate Equities, Inc.'s common stockholders decreased 22%. The weighted average number of basic and diluted common stock outstanding for calculating FFO per share (diluted) attributable to Alexandria Real Estate Equities, Inc.'s common stockholders totaled 39,094,018 and 44,903,051, respectively, for the third quarter of 2009 and 31,694,711 and 31,807,455, respectively, for the third quarter of 2008. For the nine months ended September 30, 2009, we reported FFO attributable to Alexandria Real Estate Equities, Inc.'s common stockholders of $180,427,000, or $4.49 per share (diluted), compared to FFO attributable to
Alexandria Real Estate Equities, Inc.'s common stockholders of $130,317,000, or $4.11 per share (diluted), for nine months ended September 30, 2008. Comparing the nine months ended September 30, 2009 to the nine months ended September 30, 2008, FFO attributable to Alexandria Real Estate Equities, Inc.'s common stockholders and FFO per share (diluted) attributable to Alexandria Real Estate Equities, Inc.'s common stockholders increased 38% and 9%, respectively.
FFO is a non-GAAP measure widely used by publicly traded real estate investment trusts. We compute FFO in accordance with standards established by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT") in its April 2002 White Paper and related implementation guidance. A reconciliation of net income attributable to Alexandria Real Estate Equities, Inc.'s common stockholders in accordance with United States generally accepted accounting principles ("GAAP") to FFO attributable to Alexandria Real Estate Equities, Inc.'s common stockholders is included in the financial information accompanying this press release. The primary reconciling item between GAAP net income attributable to Alexandria Real Estate Equities, Inc.'s common stockholders and FFO attributable to Alexandria Real Estate Equities, Inc.'s common stockholders is depreciation and amortization expense. Depreciation and amortization expense for the three months ended September 30, 2009 and 2008 was $28,336,000 and $27,447,000, respectively. Depreciation and amortization expense for the nine months ended September 30, 2009 and 2008 was $89,504,000 and $80,260,000, respectively. Net income attributable to Alexandria Real Estate Equities, Inc.'s common stockholders for the third quarter of 2009 was $18,203,000, or $0.47 per share (diluted), compared to net income attributable to Alexandria Real Estate Equities, Inc.'s common stockholders of $19,319,000, or $0.61 per share (diluted), for the third quarter of 2008. The weighted average number of basic and diluted common stock outstanding for calculating earnings per share attributable to Alexandria Real Estate Equities, Inc.'s common stockholders totaled 39,094,018 and 39,105,950, respectively, for the third quarter of 2009 and 31,694,711 and 31,807,455, respectively, for the third quarter of 2008. Net income attributable to Alexandria Real Estate Equities, Inc.'s common stockholders for the nine months ended September 30, 2009 was $83,314,000, or $2.26 per share (diluted), compared to net income attributable to Alexandria Real Estate Equities, Inc.'s common stockholders of $71,521,000, or $2.25 per share (diluted), for the nine months ended September 30, 2008.
For the third quarter of 2009, we executed a total of 29 leases for approximately 450,000 rentable square feet of space at 21 different properties (excluding month-to-month leases). Of this total, approximately 207,000 rentable square feet related to new or renewal leases of previously leased space and approximately 243,000 rentable square feet related to developed, redeveloped or previously vacant space. Of the 243,000 rentable square feet, approximately 144,000 rentable square feet were delivered from our development or redevelopment programs, with the remaining approximately 99,000 rentable square feet related to previously vacant space. Rental rates for these new or renewal leases were on average approximately 5.6% higher (on a GAAP basis) than rental rates for expiring leases.
For the nine months ended September 30, 2009, we executed a total of 108 leases for approximately 1,349,000 rentable square feet of space at 49 different properties (excluding month-to-month leases). Of this total, approximately 788,000 rentable square feet related to new or renewal leases of previously leased space and approximately 561,000 rentable square feet related to developed, redeveloped or previously vacant space. Of the 561,000 rentable square feet, approximately 252,000 rentable square feet were delivered from our development or redevelopment programs, with the remaining approximately 309,000 rentable square feet related to previously vacant space. Rental rates for these new or renewal leases were on average approximately 4.9% higher (on a GAAP basis) than rental rates for expiring leases.
During the nine months ended September 30, 2009, we sold three properties aggregating 64,218 rentable square feet to a life science user. These properties were located in the San Diego market and were sold for approximately $14.5 million at a gain of approximately $2.2 million. As of September 30, 2009, four properties with approximately 269,196 rentable square feet were classified as "held for sale." In October 2009, we sold one property located in the Suburban Washington, D.C. market aggregating 47,558 rentable square feet to a life science user for approximately $6.4 million.
In July 2009, we announced that we entered into a 15-year lease with Eli Lilly and Company ("Lilly") as the anchor tenant at the Alexandria Center for Life Science at East River Science Park - NYC(TM) ("the Alexandria Center"), a highly advanced state-of-the-art urban science park in New York City. Lilly has leased approximately 91,000 rentable square feet, as well as an additional approximately 9,000 rentable square feet of core services space, at the Alexandria Center, which will become the new research headquarters for ImClone Systems, a wholly-owned subsidiary of Lilly, and New York City's life science collaboration and translational research epicenter.
Also in July 2009, we completed the ground-up development of one property located in the San Francisco Mission Bay submarket aggregating 102,000 rentable square feet pursuant to a 15-year lease with Pfizer Inc.
In October 2009, we closed on a 10-year secured loan with an insurance company approximating $120 million. The loan is secured by several of our operating properties.
As of September 30, 2009, approximately 88% of our leases (on a rentable square footage basis) were triple net leases, requiring tenants to pay substantially all real estate taxes and insurance, common area and other operating expenses, including increases thereto. In addition, approximately 7% of our leases (on a rentable square footage basis) required the tenants to pay a majority of operating expenses. Additionally, approximately 92% of our leases (on a rentable square footage basis) provided for the recapture of certain capital expenditures, and approximately 93% of our leases (on a rentable square footage basis) contained effective annual rent escalations that were either fixed or indexed based on the consumer price index or another index.
Based on our current view of existing market conditions and certain current assumptions, our updated guidance for FFO per share (diluted) attributable to Alexandria Real Estate Equities, Inc.'s common stockholders and earnings per share (diluted) attributable to Alexandria Real Estate Equities, Inc.'s common stockholders is as follows:
2009
----
FFO per share (diluted) (1) $5.52 (1)
Earnings per share (diluted) (1) $2.69 (1)
(1) Our guidance for 2009 includes a $7.2 million gain for a cash payment
related to real estate acquired in November 2007 and a $11.3 million
gain on early extinguishment of debt recognized during the nine
months ended September 30, 2009. Our guidance for FFO per share
(diluted) for the twelve months ended December 31, 2009 assumes
conversion of our 8% unsecured convertible notes as the impact of
the conversion is expected to be dilutive under the "if-converted"
method. Our guidance for earnings per share (diluted) for the twelve
months ended December 31, 2009, however, does not assume conversion
of our 8% unsecured convertible notes as the impact of the conversion
is expected to be anti-dilutive under the "if-converted" method.
Alexandria Real Estate Equities, Inc. ("Alexandria") has a very broad and diversified quality client tenant base. As of September 30, 2009, on a rental revenue basis by sector, Alexandria's multinational pharmaceutical client tenants led by its top client tenants Novartis AG, Roche Holding Ltd, GlaxoSmithKline plc, Pfizer Inc., Johnson & Johnson and Merck & Co., Inc., represented approximately 28% of its client tenant base; revenue producing life science product and service companies led by Quest Diagnostics Incorporated, Qiagen N.V., Laboratory Corporation of America Holdings and Monsanto Company represented approximately 19% of its client tenant base; public biopharmaceutical companies represented approximately 17% of its client tenant base and included the three largest in the sector, Amgen Inc., Gilead Sciences, Inc., Celgene Corporation; government agencies and renowned medical and research institutions represented approximately 15% of its client tenant base and included The Scripps Research Institute, Massachusetts Institute of Technology, Fred Hutchinson Cancer Research Center, University of Washington, the Burnham Institute for Medical Research and the United States Government; private biopharmaceutical companies represented approximately 14% of its client tenant base and included high-quality, leading-edge companies with blue chip venture and institutional investors, including Achaogen, Inc., Ambrx, Inc., Intellikine, Inc., MacroGenics, Inc. and ToleRx, Inc.; the remaining approximately 7% of its client tenant base consisted of traditional office tenants. The two fastest growing client tenant sectors by revenue currently include leading institutional and multinational pharmaceutical. Alexandria's innovative business model, very strong and unique life sciences and underwriting skills with substantial experience and expertise, long-term life science industry relationships and sophisticated management with both real estate and life science operating experience and expertise, set Alexandria apart from all other publicly-traded REITs.
We will host a conference call on Thursday, November 5, 2009 at 3:00 p.m. Eastern Time ("ET")/12:00 p.m. noon Pacific Time ("PT") that is open to the general public to discuss our operating and financial results for the third quarter ended September 30, 2009. To participate in this conference call, dial (719) 325-2255 and confirmation code 8251486, shortly before 3:00 p.m. ET/12:00 p.m. noon PT. The audio web cast can be accessed at: www.labspace.com, in the Corporate Information section. A replay of the call will be available from 6:00 p.m. ET/3:00 p.m. PT on Thursday, November 5, 2009 through a limited time thereafter. The replay number is (719) 457-0820 and the confirmation code is 8251486.
Additionally, a copy of Alexandria Real Estate Equities, Inc.'s Supplemental Financial & Property Information for the quarter ended September 30, 2009 and this press release are available in the Corporate Information section of our website at www.labspace.com.
Alexandria Real Estate Equities, Inc., Landlord of Choice to the Life Science Industry®, is the largest owner and pre-eminent first-in-class REIT focused principally on science-driven cluster formation. Alexandria is the leading provider of high-quality environmentally sustainable real estate, technical infrastructure, and services to the broad and diverse life science industry. Client tenants include institutional (universities and independent not-for-profit institutions), pharmaceutical, biopharmaceutical, medical device, product, service and translational entities, as well as government agencies. Alexandria's operating platform is based on the principle of "clustering," with assets and operations located in key life science markets. Our asset base approximates 12.8 million rentable square feet consisting of 157 properties approximating 11.8 million rentable square feet (including spaces undergoing active redevelopment) and properties undergoing ground-up development approximating an additional 980,000 rentable square feet.
This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements regarding our 2009 earnings per share (diluted) attributable to Alexandria Real Estate Equities, Inc.'s common stockholders, 2009 FFO per share (diluted) attributable to Alexandria Real Estate Equities, Inc.'s common stockholders, the business plans of certain tenants and the expected impact of the conversion of our unsecured convertible notes. Our actual results may differ materially from those projected in such forward-looking statements. Factors that might cause such a difference include, without limitation, our failure to obtain capital (debt, construction financing and or equity) or refinance debt maturities, increased interest rates and operating costs, adverse economic or real estate developments in our markets, our failure to successfully complete and lease our existing space held for redevelopment and new properties acquired for that purpose and any properties undergoing development, our failure to successfully operate or lease acquired properties, decreased rental rates or increased vacancy rates or failure to renew or replace expiring leases, defaults on or non-renewal of leases by tenants, general and local economic conditions and other risks and uncertainties detailed in our filings with the Securities and Exchange Commission ("SEC"). All forward-looking statements are made as of the date of this press release, and we assume no obligation to update this information. For more discussion relating to risks and uncertainties that could cause actual results to differ materially from those anticipated in our forward-looking statements, and risks to our business in general, please refer to our SEC filings, including our most recent annual report on Form 10-K and any subsequent quarterly reports on Form 10-Q.
ALEXANDRIA REAL ESTATE EQUITIES, INC.
Condensed Consolidated Income Statements
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2009 2008 (1) 2009 2008 (1)
----- ------- ---- -------
Income statement data
Total revenues $114,605 $112,531 $365,771 $327,133
Expenses
Rental operations 30,783 29,057 91,430 83,567
General and
administrative 9,610 8,587 27,827 25,816
Interest 20,909 21,289 61,865 63,174
Depreciation and
amortization 28,031 26,924 87,878 78,520
Non-cash impairment
on investments - - - 1,985
-------- -------- -------- --------
Total expenses 89,333 85,857 269,000 253,062
Gain on early
extinguishment of debt - - 11,254 -
-------- -------- -------- --------
Income from continuing
operations 25,272 26,674 108,025 74,071
Income from discontinued
operations, net 1,106 928 3,718 18,458
-------- -------- -------- --------
Net income 26,378 27,602 111,743 92,529
Net income attributable
to noncontrolling
interests 886 929 6,123 2,828
Dividends on preferred
stock 7,090 7,090 21,268 17,136
Net income attributable
to unvested restricted
stock awards 199 265 1,038 1,048
-------- -------- -------- --------
Net income attributable
to Alexandria Real
Estate Equities, Inc.'s
common stockholders $18,203 $19,318 $83,314 $71,517
======== ======== ======== ========
Earnings per share
attributable to
Alexandria Real Estate
Equities, Inc.'s common
stockholders - basic
Continuing operations $0.44 $0.58 $2.16 $1.68
Discontinued
operations, net 0.03 0.03 0.10 0.58
-------- -------- -------- --------
Earnings per share
- basic $0.47 $0.61 $2.26 $2.26
======== ======== ======== ========
Earnings per share
attributable to
Alexandria Real Estate
Equities, Inc.'s common
stockholders - diluted
Continuing operations $0.44 $0.58 $2.16 $1.68
Discontinued operations,
net 0.03 0.03 0.10 0.57
-------- -------- -------- --------
Earnings per share
- diluted $0.47 $0.61 $2.26 $2.25
======== ======== ======== ========
(1) Includes the retrospective impact of new accounting provisions
adopted on January 1, 2009 impacting accounting for and disclosure
of convertible debt, noncontrolling interests and participating
securities.
ALEXANDRIA REAL ESTATE EQUITIES, INC.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
September 30, December 31,
2009 2008 (1)
---- -------
Assets
Rental properties, net $3,366,960 $3,215,723
Land held for future development 254,549 109,478
Construction in progress $1,349,656 1,398,895
Cash and cash equivalents 68,280 71,161
Tenant security deposits and other
restricted cash 60,002 67,782
Tenant receivables 3,789 6,453
Deferred rent 92,022 85,733
Investments 71,080 61,861
Other assets 126,999 114,991
---------- ----------
Total assets $5,393,337 $5,132,077
========== ==========
Liabilities and Equity
Secured notes payable $837,177 $1,081,963
Unsecured line of credit and unsecured
term loan 1,248,000 1,425,000
Unsecured convertible notes 580,919 431,145
Accounts payable, accrued expenses and
tenant security deposits 325,720 386,801
Dividends payable 21,665 32,105
---------- ----------
Total liabilities 3,013,481 3,357,014
Redeemable noncontrolling interests 41,232 33,963
Alexandria Real Estate Equities, Inc.
stockholders' equity:
Series C preferred stock 129,638 129,638
Series D cumulative convertible
preferred stock 250,000 250,000
Common stock 437 319
Additional paid-in capital 1,961,421 1,407,294
Accumulated other comprehensive loss (44,162) (87,241)
---------- ----------
Total Alexandria Real Estate Equities,
Inc. stockholders' equity 2,297,334 1,700,010
Noncontrolling interests 41,290 41,090
---------- ----------
Total equity 2,338,624 1,741,100
---------- ----------
Total $5,393,337 $5,132,077
========== ==========
(1) Includes the retrospective impact of new accounting provisions
adopted on January 1, 2009 impacting accounting for and disclosure
of convertible debt, noncontrolling interests and participating
securities.
ALEXANDRIA REAL ESTATE EQUITIES, INC.
Earnings per Share
(Unaudited)
Earnings per Share ("EPS")
The following table presents the computation of basic and diluted EPS
for the three and nine months ended September 30, 2009 and 2008
(in thousands, except share and per share data):
Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008(1) 2009 2008(1)
---- ------ ---- ------
Net income attributable to
Alexandria Real Estate
Equities, Inc.'s common
stockholders - numerator for
basic earnings per share $18,203 $19,318 $83,314 $71,517
Assumed conversion of 8%
unsecured convertible notes - - - -
Effect of dilutive securities
and assumed conversion
attributable to unvested
restricted stock awards - 1 - 4
---------- ---------- ---------- ----------
Net income attributable to
Alexandria Real Estate
Equities, Inc.'s common
stockholders assuming effect
of dilutive securities and
assumed conversion -
numerator for diluted
earnings per share $18,203 $19,319 $83,314 $71,521
========== ========== ========== ==========
Weighted average shares of
common stock outstanding
for calculating earnings
per share attributable to
Alexandria Real Estate
Equities, Inc.'s common
stockholders - denominator
for basic earnings per
share 39,094,018 31,694,711 36,858,606 31,619,163
Effect of dilutive securities
and assumed conversion:
Dilutive effect of stock
options 11,932 112,744 8,207 126,671
Assumed conversion of 8%
unsecured convertible notes - - - -
---------- ---------- ---------- ----------
Weighted average shares of
common stock outstanding for
calculating earnings per
share attributable to
Alexandria Real Estate Equities,
Inc.'s common stockholders
assuming effect of dilutive
securities and assumed
conversion - denominator
for diluted earnings
per share 39,105,950 31,807,455 36,866,813 31,745,834
========== ========== ========== ==========
Earnings per share
attributable to Alexandria
Real Estate Equities,
Inc.'s common stockholders
Basic $0.47 $0.61 $2.26 $2.26
========== ========== ========== ==========
Diluted $0.47 $0.61 $2.26 $2.25
========== ========== ========== ==========
(1) Includes the retrospective impact of new accounting provisions
adopted on January 1, 2009 impacting accounting for and disclosure
of convertible debt, noncontrolling interests and participating
securities.
ALEXANDRIA REAL ESTATE EQUITIES, INC.
Funds from Operations
(Unaudited)
Funds from Operations ("FFO") (1)
The following table presents a reconciliation of net income attributable
to Alexandria Real Estate Equities, Inc.'s common stockholders, the most
directly comparable GAAP financial measure to FFO, to FFO attributable to
Alexandria Real Estate Equities, Inc.'s common stockholders for the three
and nine months ended September 30, 2009 and 2008 (in thousands, except
share and per share data):
Three Months Ended Nine Months Ended
September 30, September 30,
2009 2008(2) 2009 2008(2)
---- ------ ---- ------
Net income attributable
to Alexandria Real
Estate Equities, Inc.'s
common stockholders $18,203 $19,318 $83,314 $71,517
Add: Depreciation and
amortization (3) 28,336 27,447 89,504 80,260
Add: Net income
attributable to
noncontrolling interests 886 929 6,123 2,828
Add: Net income
attributable to unvested
restricted stock awards 199 265 1,038 1,048
Subtract: Gain on sales
of property - - (2,234) (20,395)
Subtract: FFO attributable
to noncontrolling interests (918) (1,054) (2,837) (3,039)
Subtract: FFO attributable
to unvested restricted
stock awards (505) (634) (2,153) (1,909)
---------- ---------- ---------- ----------
FFO attributable to
Alexandria Real Estate,
Inc.'s common stockholders -
numerator for basic FFO
per share 46,201 46,271 172,755 130,310
Add: Assumed conversion
of 8% unsecured
convertible notes 4,384 - 7,581 -
Add: Effect of dilutive
securities and assumed
conversion attributable
to unvested restricted
stock awards 24 2 91 7
---------- ---------- ---------- ----------
FFO attributable to
Alexandria Real Estate, Inc.'s
common stockholders assuming
effect of dilutive
securities and assumed
conversion - numerator for
diluted FFO per share $50,609 $46,273 $180,427 $130,317
========== ========== ========== ==========
Weighted average shares of
common stock outstanding
for calculating FFO per
share attributable to
Alexandria Real Estate
Equities, Inc.'s common
stockholders - denominator
for basic FFO per share 39,094,018 31,694,711 36,858,606 31,619,163
Effect of dilutive
securities and assumed
conversion:
Dilutive effect of
stock options 11,932 112,744 8,207 126,671
Assumed conversion of
8% unsecured convertible
notes 5,797,101 - 3,333,864 -
---------- ---------- ---------- ----------
Weighted average shares of
common stock outstanding
for calculating FFO per
share attributable to
Alexandria Real Estate
Equities, Inc.'s common
stockholders assuming effect
of dilutive securities and
assumed conversion -
denominator for diluted FFO
per share 44,903,051 31,807,455 40,200,677 31,745,834
========== ========== ========== ==========
FFO per share attributable
to Alexandria Real Estate
Equities, Inc.'s common
stockholders
Basic $1.18 $1.46 $4.69 $4.12
========== ========== ========== ==========
Diluted $1.13 $1.45 $4.49 $4.11
========== ========== ========== ==========
(1) See note regarding FFO on page 9.
(2) Includes the retrospective impact of new accounting provisions
adopted on January 1, 2009 impacting accounting for and disclosure
of convertible debt, noncontrolling interests and participating
securities.
(3) Includes depreciation and amortization for assets "held for sale"
reflected as discontinued operations (for the periods prior to when
such assets were designated as "held for sale").
Note Regarding Funds from Operations
GAAP basis accounting for real estate assets utilizes historical cost accounting and assumes real estate values diminish over time. In an effort to overcome the difference between real estate values and historical cost accounting for real estate assets, the Board of Governors of NAREIT established the measurement tool of FFO. Since its introduction, FFO has become a widely used non-GAAP financial measure among REITs. We believe that FFO is helpful to investors as an additional measure of the performance of an equity REIT. We compute FFO in accordance with standards established by the Board of Governors of NAREIT in its April 2002 White Paper (the "White Paper") and related implementation guidance, which may differ from the methodology for calculating FFO utilized by other equity REITs, and, accordingly, may not be comparable to such other REITs. The White Paper defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales, plus real estate related depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures.
FFO should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of financial performance, or to cash flows from operating activities (determined in accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to make distributions.
SOURCE Alexandria Real Estate Equities, Inc.
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