Form 8-K CORPORATE OFFICE PROPERT For: Feb 10

February 10, 2015 6:01 AM
COPT 12.31.2014 EARNINGS 8K


 
 
 
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC  20549
_________________

FORM 8-K
_________________

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

Date of report (Date of earliest event reported) February 10, 2015
CORPORATE OFFICE PROPERTIES TRUST
CORPORATE OFFICE PROPERTIES, L.P.
(Exact name of registrant as specified in its charter)
Corporate Office Properties Trust
 
Maryland
 
1-14023
 
23-2947217
 
 
(State or other jurisdiction of
 
(Commission File
 
(IRS Employer
 
 
incorporation or organization)
 
Number)
 
Identification No.)
 
 
 
 
 
 
 
Corporate Office Properties, L.P.
 
Delaware
 
333-189188
 
23-2930022
 
 
(State or other jurisdiction of
 
(Commission File
 
(IRS Employer
 
 
incorporation or organization)
 
Number)
 
Identification No.)

6711 Columbia Gateway Drive, Suite 300
Columbia, Maryland 21046
(Address of principal executive offices)
(443) 285-5400
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):
o
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
 
o
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
 
o
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
 
o
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 
 
 
 






Item 2.02.             Results of Operations and Financial Condition
 
On February 10, 2015, Corporate Office Properties Trust (the “Company”) issued a press release relating to its financial results for the three months and year ended December 31, 2014 and, in connection with this release, is making available certain supplemental information pertaining to its properties and operations as of and for the period ended December 31, 2014.  The earnings release and supplemental information are included as Exhibit 99.1 to this report and are incorporated herein by reference.
 
The information included herein, including the exhibits, shall not be deemed “filed” for any purpose, including the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or subject to liabilities of that Section.  The information included herein, including the exhibits, shall also not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act regardless of any general incorporation language in such filing.

Item 9.01.             Financial Statements and Exhibits
 
(a)
Financial Statements of Businesses Acquired
 
 
 
None
 
 
(b)
Pro Forma Financial Information
 
 
 
None
 
 
(c)
Shell Company Transactions
 
 
 
None
 
 
(d)
Exhibits
 
Exhibit Number
 
Exhibit Title
99.1
 
Corporate Office Properties Trust earnings release and supplemental information for the period ended December 31, 2014, including the press release dated February 10, 2015





SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
CORPORATE OFFICE PROPERTIES TRUST
 
CORPORATE OFFICE PROPERTIES, L.P.
 
 
 
By: Corporate Office Properties Trust,
 
 
 
its General Partner
 
 
 
 
 
/s/ Anthony Mifsud
 
/s/ Anthony Mifsud
 
Anthony Mifsud
 
Anthony Mifsud
 
Executive Vice President and Chief Financial Officer
 
Executive Vice President and Chief Financial Officer
 
 
 
 
Dated:
February 10, 2015
Dated:
February 10, 2015






EXHIBIT INDEX
 
Exhibit Number
 
Exhibit Title
99.1
 
Corporate Office Properties Trust earnings release and supplemental information for the period ended December 31, 2014, including the press release dated February 10, 2015




COPT 12.31.2014 EX.99.1


EXHIBIT 99.1
 
 
Earnings Release & Supplemental Information — Unaudited
 
December 31, 2014
 
 
OVERVIEW:
Section I

 
INVESTING ACTIVITY:
Section IV

Earnings Release
i-ix

 
Dispositions
22

Summary Description
1

 
Construction, Redevelopment, Wholesale Data Center and Land Held
23

Equity Research Coverage
2

 
Summary of Construction Projects
24

Selected Financial Summary Data
3

 
Summary of Redevelopment Projects
25

Selected Consolidated Portfolio Data
4

 
Summary of Land Held
26

 
 

 
 
 
FINANCIAL STATEMENTS:
Section II

 
CAPITALIZATION:
Section V

Quarterly Consolidated Balance Sheets
5

 
Quarterly Equity Analysis
27

Consolidated Statements of Operations
6-7

 
Debt Analysis
28-29

Consolidated Statements of FFO
8-9

 
Debt Maturity Schedule
30

Consolidated Reconciliations of AFFO
10

 
Consolidated Joint Ventures
31

 
 

 
 
 
PORTFOLIO INFORMATION:
Section III

 
RECONCILIATIONS & DEFINITIONS:
Section VI

Consolidated Office Properties by Region
11

 
Supplementary Reconciliations of Non-GAAP Measures
32-35

NOI from Real Estate Operations and Occupancy by Property Grouping
12

 
Definitions
36-41

Unstabilized Office Properties
13

 
 
 
Real Estate Revenues & NOI from Real Estate Operations by Segment
14

 
 
 
Same Office Properties Average Occupancy Rates by Region
15

 
 
 
Same Office Property Real Estate Revenues & NOI by Region
16

 
 
 
Leasing - Core Office
17-18

 
 
 
Lease Expiration Analysis
19-20

 
 
 
Top 20 Office Tenants
21

 
 
 
 
 
 
 
 
 
Please refer to the section entitled “Definitions” for definitions of non-GAAP measures and other terms we use herein that may not be customary or commonly known.



6711 Columbia Gateway Drive, Suite 300
Columbia, Maryland 21046
Telephone 443-285-5400
Facsimile 443-285-7650
www.copt.com
NYSE: OFC
 
 
 
NEWS RELEASE
 
 
 
FOR IMMEDIATE RELEASE
IR Contacts:
 
 
Stephanie Krewson-Kelly
Michelle Layne
 
VP, Investor Relations
Investor Relations Specialist
 
443-285-5453
443-285-5452
 
stephanie.kelly@copt.com
michelle.layne@copt.com
 

COPT REPORTS 2014 RESULTS


COLUMBIA, MD February 10, 2015 - Corporate Office Properties Trust (“COPT” or the “Company”) (NYSE: OFC) announced financial and operating results for the fourth quarter and full year ended December 31, 2014.

“Fourth quarter and full year results topped off a strong year for our Company and were in line with our expectations,” stated Roger A. Waesche, Jr., COPT’s President & Chief Executive Officer. “During the year, we further honed our portfolio by investing in new development projects at multiple locations and by continuing to sell non-strategic assets. We also improved our capital position by accessing the public debt and equity markets.”

Results:
For the fourth quarter ended December 31, 2014 - Diluted earnings per share (“EPS”) was $0.01 for the quarter ended December 31, 2014 as compared to $0.94 for the fourth quarter of 2013. Diluted funds from operations per share (“FFOPS”), as calculated in accordance with NAREIT’s definition, was $0.34 for the fourth quarter of 2014 as compared to $1.21 for the fourth quarter of 2013. FFOPS, as adjusted for comparability, was $0.49 for the quarter ended December 31, 2014 as compared to $0.48 for the fourth quarter of 2013.

For the year ended December 31, 2014 - EPS was $0.25 for the year ended December 31, 2014 as compared to $0.83 for 2013. Per NAREIT’s definition, FFOPS for 2014 was $1.69 as compared to $2.40 for 2013. FFOPS for the full year 2014, as adjusted for comparability, was $1.88 as compared to $1.97 reported for 2013.

Adjustments for comparability encompass items such as acquisition costs, impairment losses and gains on non-operating properties (net of related tax adjustments), gains (losses) on early extinguishment of debt, derivative losses, executive transition costs and write-offs of original issuance costs for redeemed preferred shares.


i


Operating Performance:
Portfolio Summary - At December 31, 2014, the Company’s operating portfolio of 173 operating office properties totaled 16.8 million square feet that were 90.9% occupied and 92.4% leased.

Same Office Performance - At December 31, 2014, COPT’s same office portfolio represented 89.4% of the rentable square feet of the portfolio, consisted of 160 properties and was 91.3% occupied and 92.5% leased.

For the quarter ended December 31, 2014, the Company’s same office property cash NOI, excluding gross lease termination fees, increased 3.6% as compared to the quarter ended December 31, 2013. For the full year, same office property cash NOI, excluding gross lease termination fees, increased 1.3% as compared to 2013.

Leasing - COPT completed a total of 1.0 million and 3.0 million square feet of leasing, respectively, for the quarter and year ended December 31, 2014. During these same periods, the Company’s respective renewal rates were 63% and 70%.

In the fourth quarter, lease terms on renewals averaged 5.8 years and for development and other new leases averaged 11.5 years. During the full year, average lease terms on renewals were 5.0 years and on development and other new leases were 9.3 years.

For the quarter and year ended December 31, 2014, total rent on renewed space increased 9.7% and 7.3%, respectively, as measured on a GAAP basis; on a cash basis, renewal rates were flat in the fourth quarter of 2014 and declined 2.2% for the year as compared to the expiring rents.

During the fourth quarter, leasing highlights include:
long-term lease with a subsidiary of an investment-grade Fortune 500 company to deliver a 120,000 square foot shell building on land the Company owns in Ashburn, VA (Ashburn Crossing). This will be the third building of a three-building campus. The Company has commenced construction of the building in anticipation of a lease start date in the first quarter of 2015.
full-building lease on a 240,000 square foot, Class A office development in Northern Virginia. The project has been leased to a customer in the Company’s strategic tenant niche for a multi-year lease term. The lease start date is anticipated to be the second quarter of 2017.
lease for 0.3 mega watts at COPT DC-6 in Manassas, VA.

Investment Activity:
Developments - The Company has ten properties totaling 1.5 million square feet under construction for a total projected cost of $331.9 million, of which $172.4 million had been incurred which were 75% leased. COPT has 344,000 square feet in five properties under redevelopment which were 41% leased.

Dispositions - During 2014, the Company disposed of eight buildings aggregating 303,000 square feet and non-strategic land for $57.1 million.

Balance Sheet and Capital Transactions:
As of December 31, 2014, the Company’s debt to adjusted book ratio was 39.7%, adjusted debt to in-place adjusted EBITDA ratio was 6.3x, and, for the three months ended December 31, 2014, its adjusted EBITDA fixed charge coverage ratio was 2.8x. Also, the Company’s weighted average interest rate was 4.2% for the quarter ended December 31, 2014 and, including the effect of interest rate swaps, 89% of the Company’s debt was subject to fixed interest rates.

In May, the Company issued $300 million of 3.70% senior unsecured notes due June 15, 2021 at a price equal to 99.739% of the principal amount. Also in May, the Company redeemed all of its 2,000,000 outstanding

ii


7.5% Series H Cumulative Redeemable Preferred Shares, at a price of $25.3230 per share including accrued and unpaid dividends through the date of redemption.

In November, the Company completed its public offering of 5,520,000 newly issued common shares, which reflects the full exercise by the underwriter of its option to purchase 720,000 shares. The offering generated net proceeds of approximately $148.7 million, after the underwriting discount and offering-related expenses payable by the Company.

In early December, the Company, using primarily proceeds from the November common stock offering defeased $211.5 million of secured non-recourse debt.

Conference Call Information:
Management will discuss fourth quarter and full year 2014 earnings results, as well as its 2015 guidance, on its conference call today at 12:00 p.m. Eastern Time, details of which are listed below:

Earnings Release Date:    Tuesday, February 10, 2015 at 6:00 a.m. Eastern Time
Conference Call Date:     Tuesday, February 10, 2015
Time:     12:00 p.m. Eastern Time
Telephone Number: (within the U.S.)     888-713-4199
Telephone Number: (outside the U.S.)    617-213-4861
Passcode:    44019327

Please use the following link to pre-register and view important information about this conference call. Pre-registering is not mandatory but is recommended as it will provide you immediate entry into the call and will facilitate the timely start of the conference. Pre-registration only takes a few moments and you may pre-register at anytime, including up to and after the call start time. To pre-register, please click on the below link:
https://www.theconferencingservice.com/prereg/key.process?key=PL46J93RD

You may also pre-register in the Investors section of the Company’s website at www.copt.com. Alternatively, you may be placed into the call by an operator by calling the number provided above at least 5 to 10 minutes before the start of the call.

A replay of this call will be available beginning Tuesday, February 10 at 4:00 p.m. Eastern Time through Tuesday, February 24 at midnight Eastern Time. To access the replay within the United States, please call 888-286-8010 and use passcode 70008103. To access the replay outside the United States, please call 617-801-6888 and use passcode 70008103.

The conference call will also be available via live webcast in the Investor Relations section of the Company’s website at www.copt.com. A replay of the conference calls will be immediately available via webcast in the Investor Relations section of the Company’s website.

Definitions:
For definitions of certain terms used in this press release, please refer to the information furnished in our Supplemental Information Package filed as a Form 8-K which can be found on our website (www.copt.com). Reconciliations of non-GAAP measures to the most directly comparable GAAP measures are included in the attached tables.

iii


Company Information
COPT is an office REIT that focuses primarily on serving the specialized requirements of U.S. Government agencies and defense contractors, most of which are engaged in defense information technology and national security-related activities. As of December 31, 2014, COPT derived 77% of its annualized revenue from its strategic tenant niche properties and 23% from its regional office properties. The Company generally acquires, develops, manages and leases office and data center properties concentrated in large office parks primarily located near knowledge-based government demand drivers and/or in targeted markets or submarkets in the Greater Washington, DC/Baltimore region. As of December 31, 2014, the Company’s consolidated portfolio consisted of 173 office properties totaling 16.8 million rentable square feet. COPT is an S&P MidCap 400 company.

Forward-Looking Information
This press release may contain “forward-looking” statements, as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, that are based on the Company’s current expectations, estimates and projections about future events and financial trends affecting the Company. Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “could,” “believe,” “anticipate,” “expect,” “estimate,” “plan” or other comparable terminology. Forward-looking statements are inherently subject to risks and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate. Accordingly, the Company can give no assurance that these expectations, estimates and projections will be achieved. Future events and actual results may differ materially from those discussed in the forward-looking statements.

Important factors that may affect these expectations, estimates, and projections include, but are not limited to:
*
general economic and business conditions, which will, among other things, affect office property and data center demand and rents, tenant creditworthiness, interest rates, financing availability and property values;
*
adverse changes in the real estate markets including, among other things, increased competition with other companies;
*
governmental actions and initiatives, including risks associated with the impact of a prolonged government shutdown or budgetary reductions or impasses, such as a reduction in rental revenues, non-renewal of leases, and/or a curtailment of demand for additional space by the Company's strategic customers;
*
the Company’s ability to borrow on favorable terms;
*
risks of real estate acquisition and development activities, including, among other things, risks that development projects may not be completed on schedule, that tenants may not take occupancy or pay rent or that development or operating costs may be greater than anticipated;
*
risks of investing through joint venture structures, including risks that the Company’s joint venture partners may not fulfill their financial obligations as investors or may take actions that are inconsistent with the Company’s objectives;
*
changes in the Company’s plans for properties or views of market economic conditions or failure to obtain development rights, either of which could result in recognition of significant impairment losses;
*
the Company’s ability to satisfy and operate effectively under Federal income tax rules relating to real estate investment trusts and partnerships;
*
the Company's ability to achieve projected results;
*
the dilutive effects of issuing additional common shares; and
*
environmental requirements.

The Company undertakes no obligation to update or supplement any forward-looking statements. For further information, please refer to the Company’s filings with the Securities and Exchange Commission, particularly the section entitled “Risk Factors” in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.
 
 
 
 
 
 
 
 




iv



Corporate Office Properties Trust
Summary Financial Data
(unaudited)
(in thousands, except per share data)


 
For the Three Months Ended December 31,
 
For the Year Ended December 31,
 
2014
 
2013
 
2014
 
2013
Revenues
 

 
 

 
 
 
 
Real estate revenues
$
120,613

 
$
118,487

 
$
479,725

 
$
460,997

Construction contract and other service revenues
26,358

 
10,315

 
106,748

 
62,363

Total revenues
146,971

 
128,802

 
586,473

 
523,360

Expenses
 

 
 

 
 
 
 
Property operating expenses
43,334

 
44,117

 
179,934

 
167,199

Depreciation and amortization associated with real estate operations
31,358

 
30,326

 
136,086

 
113,214

Construction contract and other service expenses
24,705

 
9,710

 
100,058

 
58,875

Impairment losses
48

 

 
1,416

 
5,857

General and administrative expenses
7,206

 
6,523

 
24,841

 
23,736

Leasing expenses
1,706

 
1,916

 
6,953

 
7,133

Business development expenses and land carry costs
1,466

 
1,367

 
5,573

 
5,436

Total operating expenses
109,823

 
93,959

 
454,861

 
381,450

Operating income
37,148

 
34,843


131,612


141,910

Interest expense
(23,286
)
 
(21,276
)
 
(92,393
)
 
(82,010
)
Interest and other income
1,148

 
885

 
4,923

 
3,834

Loss on early extinguishment of debt
(9,106
)
 
(2
)
 
(9,552
)
 
(27,030
)
Income from continuing operations before equity in income of unconsolidated entities and income taxes
5,904

 
14,450

 
34,590

 
36,704

Equity in income of unconsolidated entities
23

 
1,899

 
229

 
2,110

Income tax expense
(53
)
 
(1,917
)
 
(310
)
 
(1,978
)
Income from continuing operations
5,874

 
14,432

 
34,509

 
36,836

Discontinued operations
22

 
71,907

 
26

 
55,692

Income before gain on sales of real estate
5,896

 
86,339

 
34,535

 
92,528

Gain on sales of real estate, net of income taxes
41

 
6,333

 
10,671

 
9,016

Net income
5,937

 
92,672

 
45,206

 
101,544

Net income attributable to noncontrolling interests
 

 
 

 
 
 
 
Common units in the Operating Partnership
(64
)
 
(3,757
)
 
(1,006
)
 
(3,283
)
Preferred units in the Operating Partnership
(165
)
 
(165
)
 
(660
)
 
(660
)
Other consolidated entities
(804
)
 
(1,734
)
 
(3,285
)
 
(3,894
)
Net income attributable to COPT
4,904

 
87,016

 
40,255

 
93,707

Preferred share dividends
(3,552
)
 
(4,490
)
 
(15,939
)
 
(19,971
)
Issuance costs associated with redeemed preferred shares

 

 
(1,769
)
 
(2,904
)
Net income attributable to COPT common shareholders
$
1,352

 
$
82,526

 
$
22,547

 
$
70,832

 
 
 
 
 
 
 
 
Earnings per share (“EPS”) computation:
 

 
 

 
 
 
 
Numerator for diluted EPS:
 

 
 

 
 
 
 
Net income attributable to common shareholders
$
1,352

 
$
82,526

 
$
22,547

 
$
70,832

Amount allocable to restricted shares
(100
)
 
(348
)
 
(432
)
 
(414
)
Numerator for diluted EPS
$
1,252

 
$
82,178

 
$
22,115

 
$
70,418

 
 
 
 
 
 
 
 
Denominator:
 

 
 

 
 
 
 
Weighted average common shares - basic
90,752

 
87,010

 
88,092

 
85,167

Dilutive effect of share-based compensation awards
196

 
42

 
171

 
57

Weighted average common shares - diluted
90,948

 
87,052

 
88,263

 
85,224

Diluted EPS
$
0.01

 
$
0.94

 
$
0.25

 
$
0.83


v



Corporate Office Properties Trust
Summary Financial Data
(unaudited)
(in thousands, except per share data)

 
For the Three Months Ended December 31,
 
For the Year Ended December 31,
 
2014
 
2013
 
2014
 
2013
Net income
$
5,937

 
$
92,672

 
$
45,206

 
$
101,544

Real estate-related depreciation and amortization
31,358

 
31,322

 
136,086

 
117,719

Impairment losses on previously depreciated operating properties
48

 
921

 
1,370

 
32,047

Loss (gain) on sales of previously depreciated operating properties
2

 
(9,004
)
 
(5,117
)
 
(9,004
)
Funds from operations (“FFO”)
37,345

 
115,911

 
177,545

 
242,306

Noncontrolling interests - preferred units in the Operating Partnership
(165
)
 
(165
)
 
(660
)
 
(660
)
FFO allocable to other noncontrolling interests
(867
)
 
(880
)
 
(3,216
)
 
(3,710
)
Preferred share dividends
(3,552
)
 
(4,490
)
 
(15,939
)
 
(19,971
)
Issuance costs associated with redeemed preferred shares

 

 
(1,769
)
 
(2,904
)
Basic and diluted FFO allocable to restricted shares
(123
)
 
(462
)
 
(665
)
 
(912
)
Basic and diluted FFO available to common share and common unit holders (“Basic and diluted FFO”)
32,638

 
109,914

 
155,296

 
214,149

Gain on sales of non-operating properties
(43
)
 

 
(5,578
)
 
(2,683
)
Impairment losses on other properties

 

 
49

 

Valuation allowance on tax asset associated with FFO comparability adjustments

 
1,855

 

 
1,855

Loss (gain) on early extinguishment of debt
9,106

 
(67,808
)
 
9,668

 
(40,780
)
Issuance costs associated with redeemed preferred shares

 

 
1,769

 
2,904

Add: Negative FFO of properties to be conveyed to extinguish debt in default (1)
3,493

 

 
10,928

 

Executive transition costs
1,056

 

 
1,056

 

Diluted FFO comparability adjustments allocable to restricted shares
(59
)
 
168

 
(78
)
 
168

Diluted FFO available to common share and common unit holders, as adjusted for comparability
46,191

 
44,129

 
173,110

 
175,613

Straight line rent adjustments
(379
)
 
3,157

 
(1,820
)
 
(3,667
)
Straight line rent adjustments - properties in default to be conveyed
(47
)
 

 
(142
)
 

Amortization of intangibles included in net operating income
208

 
224

 
855

 
803

Share-based compensation, net of amounts capitalized
1,504

 
1,661

 
6,067

 
6,530

Amortization of deferred financing costs
1,020

 
1,159

 
4,666

 
5,451

Amortization of deferred financing costs - properties in default to be conveyed

 

 
(333
)
 

Amortization of net debt discounts, net of amounts capitalized
261

 
(48
)
 
920

 
1,015

Amortization of settled debt hedges
11

 
15

 
57

 
61

Recurring capital expenditures
(8,633
)
 
(21,935
)
 
(50,199
)
 
(43,633
)
Diluted adjusted funds from operations available to common share and common unit holders (“Diluted AFFO”)
$
40,136

 
$
28,362

 
$
133,181

 
$
142,173

Diluted FFO per share
$
0.34

 
$
1.21

 
$
1.69

 
$
2.40

Diluted FFO per share, as adjusted for comparability
$
0.49

 
$
0.48

 
$
1.88

 
$
1.97

Dividends/distributions per common share/unit
$
0.275

 
$
0.275

 
$
1.100

 
$
1.100


(1) Interest expense exceeded net operating income from these properties by the amounts in the statement.


vi



Corporate Office Properties Trust
Summary Financial Data
(unaudited)
(Dollars and shares in thousands, except per share data)

 
 
December 31,
2014
 
December 31,
2013
Balance Sheet Data
 
 

 
 

Properties, net of accumulated depreciation
 
$
3,296,914

 
$
3,214,301

Total assets
 
3,670,257

 
3,629,952

Debt, net
 
1,920,057

 
1,927,703

Total liabilities
 
2,130,956

 
2,114,945

Redeemable noncontrolling interest
 
18,417

 
17,758

Equity
 
1,520,884

 
1,497,249

Debt to adjusted book
 
39.7
%
 
43.6
%
Debt to total market capitalization
 
39.3
%
 
44.3
%
 
 
 
 
 
Core Portfolio Data (as of period end) (1)
 
 

 
 

Number of operating properties
 
173

 
177

Total net rentable square feet owned (in thousands)
 
16,790

 
16,045

Occupancy %
 
90.9
%
 
88.7
%
Leased %
 
92.4
%
 
90.0
%
 
 
 
 
 
 
For the Three Months Ended December 31,
 
For the Year Ended December 31,
2014
 
2013
 
2014
 
2013
Payout ratios
 

 
 

 
 

 
 

Diluted FFO
81.8
%
 
22.9
%
 
65.8
%
 
46.5
%
Diluted FFO, as adjusted for comparability
57.8
%
 
56.9
%
 
59.0
%
 
56.7
%
Diluted AFFO
66.5
%
 
88.6
%
 
76.7
%
 
70.0
%
Adjusted EBITDA interest coverage ratio
4.0
x
 
3.3
x
 
3.7
x
 
3.5
x
Adjusted EBITDA fixed charge coverage ratio
2.8
x
 
2.4
x
 
2.7
x
 
2.4
x
Adjusted debt to in-place adjusted EBITDA ratio (2)
6.3
x
 
6.8
x
 
N/A

 
N/A

 
 
 
 
 
 
 
 
Reconciliation of denominators for diluted EPS and diluted FFO per share
 
 

 
 
 
 
Denominator for diluted EPS
90,948

 
87,052

 
88,263

 
85,224

Weighted average common units
3,846

 
3,978

 
3,897

 
3,869

Denominator for diluted FFO per share
94,794

 
91,030

 
92,160

 
89,093

 
 
 
 
 
 
 
 
Reconciliation of FFO to FFO, as adjusted for comparability
 

 
 

 
 

 
 

FFO, per NAREIT
$
37,345

 
$
115,911

 
$
177,545

 
$
242,306

Gain on sales of non-operating properties
(43
)
 

 
(5,578
)
 
(2,683
)
Impairment losses on non-operating properties, net of associated tax

 

 
49

 

Valuation allowance on tax asset associated with FFO comparability adjustments

 
1,855

 

 
1,855

Loss (gain) on early extinguishment of debt, continuing and discontinued operations
9,106

 
(67,808
)
 
9,668

 
(40,780
)
Issuance costs associated with redeemed preferred shares

 

 
1,769

 
2,904

Add: Negative FFO of properties to be conveyed to extinguish debt in default
3,493

 

 
10,928

 

Executive transition costs
1,056

 

 
1,056

 

FFO, as adjusted for comparability
$
50,957

 
$
49,958

 
$
195,437

 
$
203,602


(1)
Represents operating properties held for long-term investment.
(2)
Represents debt as of period end divided by in-place adjusted EBITDA for the period, as annualized (i.e. three month periods are multiplied by four).

vii



Corporate Office Properties Trust
Summary Financial Data
(unaudited)
(Dollars in thousands)

 
For the Three Months Ended December 31,
 
For the Year Ended December 31,
 
2014
 
2013
 
2014
 
2013
Reconciliation of common share dividends to dividends and distributions for payout ratios
 

 
 

 
 
 
 
Common share dividends
$
25,638

 
$
24,026

 
$
97,944

 
$
95,246

Common unit distributions
1,055

 
1,094

 
4,270

 
4,280

Dividends and distributions for payout ratios
$
26,693

 
$
25,120

 
$
102,214

 
$
99,526

 
 
 
 
 
 
 
 
Reconciliation of GAAP net income to adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”) and in-place adjusted EBITDA
 

 
 

 
 

 
 

Net income
$
5,937

 
$
92,672

 
$
45,206

 
$
101,544

Interest expense on continuing operations
23,286

 
21,276

 
92,393

 
82,010

Interest expense on discontinued operations

 
1,905

 

 
8,221

Income tax expense
53

 
1,917

 
310

 
1,978

Real estate-related depreciation and amortization
31,358

 
31,322

 
136,086

 
117,719

Depreciation of furniture, fixtures and equipment
513

 
495

 
2,404

 
2,054

Impairment losses
48

 
921

 
1,419

 
32,047

Loss (gain) on early extinguishment of debt on continuing and discontinued operations
9,106

 
(67,808
)
 
9,668

 
(40,780
)
Loss (gain) on sales of operating properties
2

 
(9,004
)
 
(5,117
)
 
(9,004
)
Gain on sales of non-operational properties
(43
)
 

 
(5,578
)
 
(2,683
)
Net (gain) loss on investments in unconsolidated entities included in interest and other income
(74
)
 
221

 
291

 
206

EBITDA of properties to be conveyed to extinguish debt in default
(828
)
 

 
(2,091
)
 

Executive transition costs
1,056

 

 
1,056

 

Adjusted EBITDA
$
70,414

 
$
73,917

 
$
276,047

 
$
293,312

Less: Net operating income from properties in quarter of disposition

 
(5,107
)
 
 
 
 
Adjusted and in-place adjusted EBITDA
$
70,414

 
$
68,810

 

 

 
 
 
 
 
 
 
 
Reconciliation of interest expense from continuing operations to the denominators for interest coverage-Adjusted EBITDA and fixed charge coverage-Adjusted EBITDA
 

 
 

 
 

 
 

Interest expense from continuing operations
$
23,286

 
$
21,276

 
$
92,393

 
$
82,010

Interest expense from discontinued operations

 
1,905

 

 
8,221

Less: Amortization of deferred financing costs
(1,020
)
 
(1,159
)
 
(4,666
)
 
(5,451
)
Less: Amortization of net debt discount, net of amounts capitalized
(261
)
 
48

 
(920
)
 
(1,015
)
Less: Interest exp. on debt in default to be extin. via conveyance of properties
(4,320
)
 

 
(12,684
)
 

Denominator for interest coverage-Adjusted EBITDA
17,685

 
22,070

 
74,123

 
83,765

Scheduled principal amortization
1,603

 
2,252

 
6,517

 
9,481

Capitalized interest
1,740

 
2,042

 
6,065

 
8,785

Preferred share dividends
3,552

 
4,490

 
15,939

 
19,971

Preferred unit distributions
165

 
165

 
660

 
660

Denominator for fixed charge coverage-Adjusted EBITDA
$
24,745

 
$
31,019

 
$
103,304

 
$
122,662

 
 
 
 
 
 
 
 

viii



Corporate Office Properties Trust
Summary Financial Data
(unaudited)
(Dollars in thousands)

 
For the Three Months Ended December 31,
 
For the Year Ended December 31,
 
2014
 
2013
 
2014
 
2013
Reconciliations of tenant improvements and incentives, capital improvements and leasing costs for operating properties to recurring capital expenditures
 
 
 
 
 
 
 
Tenant improvements and incentives on operating properties
$
7,239

 
$
6,430

 
$
29,651

 
$
17,413

Building improvements on operating properties
4,974

 
12,898

 
23,432

 
21,893

Leasing costs for operating properties
1,341

 
4,286

 
8,536

 
9,400

Less: Nonrecurring tenant improvements and incentives on operating properties
(1,747
)
 

 
(2,734
)
 
(238
)
Less: Nonrecurring building improvements on operating properties
(3,012
)
 
(1,381
)
 
(8,281
)
 
(4,494
)
Less: Nonrecurring leasing costs for operating properties
(162
)
 
(275
)
 
(405
)
 
(311
)
Add: Recurring capital expenditures on operating properties held through joint ventures

 
(23
)
 

 
(30
)
Recurring capital expenditures
$
8,633

 
$
21,935

 
$
50,199

 
$
43,633

 
 
 
 
 
 
 
 
Reconciliation of same office property net operating income to same office property cash net operating income and same office property cash net operating income, excluding gross lease termination fees
 

 
 

 
 

 
 

Same office property net operating income
$
68,861

 
$
66,162

 
$
269,593

 
$
267,742

Less: Straight-line rent adjustments
(1,857
)
 
(999
)
 
(3,798
)
 
(4,831
)
Less: Amortization of deferred market rental revenue
(2
)
 
1

 
17

 
(38
)
Add: Amortization of below-market cost arrangements
272

 
319

 
1,089

 
1,277

Same office property cash net operating income
67,274

 
65,483

 
266,901

 
264,150

Less: Lease termination fees, gross
(741
)
 
(1,249
)
 
(1,618
)
 
(2,270
)
Same office property cash net operating income, excluding gross lease termination fees
$
66,533

 
$
64,234

 
$
265,283

 
$
261,880

 
 
 
 
 
 
 
 
 
 
December 31,
2014
 
December 31,
2013
Reconciliation of total assets to adjusted book
 
 

 
 

Total assets
 
$
3,670,257

 
$
3,629,952

Accumulated depreciation
 
703,083

 
597,649

Accumulated amortization of real estate intangibles and deferred leasing costs
 
214,611

 
193,142

Less: Adjusted book assoc. with properties to be conveyed to extinguish debt in default
 
(131,118
)
 

Adjusted book
 
$
4,456,833

 
$
4,420,743

 
 
 
 
 
Reconciliation of debt to adjusted debt
 
 
 
 
Debt, net
 
$
1,920,057

 
$
1,927,703

Less: Debt in default to be extinguished via conveyance of properties
 
(150,000
)
 

Numerator for debt to adjusted book ratio
 
1,770,057

 
1,927,703

Less: Cash and cash equivalents
 
(6,077
)
 
(54,373
)
Adjusted debt
 
$
1,763,980

 
$
1,873,330


ix



Corporate Office Properties Trust
Summary Description
 
The Company: Corporate Office Properties Trust (the “Company” or “COPT”) is a self-managed office real estate investment trust (“REIT”). COPT is listed on the New York Stock Exchange under the symbol “OFC” and is a S&P MidCap 400 Company. As of December 31, 2014, COPT derived 77% of its portfolio annualized revenue from its strategic tenant niche properties and 23% from its regional office properties. COPT’s strategic tenant niche properties are those held for long-term investment that are either located near defense installations and other knowledge-based government demand drivers, or otherwise occupied primarily by U.S. Government agencies and their contractors. COPT’s regional office properties are those held for long-term investment predominantly in the Greater Washington, DC/Baltimore region, excluding Strategic Tenant Niche Properties. As of December 31, 2014, COPT’s core portfolio of 173 office properties encompassed 16.8 million square feet and was 92% leased. As of the same date, COPT also owned one wholesale data center that was 73% leased.
 
Corporate Strategy: COPT’s customer strategy focuses on serving the specialized requirements of United States Government agencies and their contractors, most of whom are engaged in national security and information technology related activities. These tenants’ missions generally pertain more to knowledge-based activities (such as cyber security, research and development and other highly technical defense and security areas) than to force structure (troops) and weapon system production. In order to support this customer strategy, COPT focuses on owning properties located near defense installations and other knowledge-based government demand drivers. COPT also focuses on owning properties in targeted markets or submarkets in the Greater Washington, DC/Baltimore region with strong growth attributes.
Management:
Investor Relations:
Roger A. Waesche, Jr., President & CEO
Stephanie M. Krewson-Kelly, VP of IR
Stephen E. Budorick, EVP & COO
443-285-5453, stephanie.kelly@copt.com
Wayne H. Lingafelter, EVP, Development & Construction
Michelle Layne, Manager of IR
Anthony Mifsud, EVP & CFO
443-285-5452, michelle.layne@copt.com
 
Corporate Credit Rating: BBB- (Fitch), Baa3 (Moody’s), and BBB- (S&P); All Stable Outlook

Disclosure Statement: This supplemental package contains forward-looking statements within the meaning of the Federal securities laws. Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “could,” “believe,” “anticipate,” “expect,” “estimate,” “plan” or other comparable terminology.  Forward-looking statements are inherently subject to risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not even anticipate.  Although we believe that the expectations, estimates and projections reflected in such forward-looking statements are based on reasonable assumptions at the time made, we can give no assurance that these expectations, estimates and projections will be achieved.  Future events and actual results may differ materially from those discussed in the forward-looking statements.  Important factors that may affect these expectations, estimates and projections include, but are not limited to: general economic and business conditions, which will, among other things, affect office property and data center demand and rents, tenant creditworthiness, interest rates, financing availability and property values; adverse changes in the real estate markets, including, among other things, increased competition with other companies; governmental actions and initiatives, including risks associated with the impact of a prolonged government shutdown or budgetary reductions or impasses, such as a reduction in rental revenues, non-renewal of leases and/or a curtailment of demand for additional space by our strategic customers; our ability to borrow on favorable terms; risks of real estate acquisition and development activities, including, among other things, risks that development projects may not be completed on schedule, that tenants may not take occupancy or pay rent or that development or operating costs may be greater than anticipated; risks of investing through joint venture structures, including risks that our joint venture partners may not fulfill their financial obligations as investors or may take actions that are inconsistent with our objectives; changes in our plans for properties or views of market economic conditions or failure to obtain development rights, either of which could result in recognition of impairment losses; our ability to satisfy and operate effectively under Federal income tax rules relating to real estate investment trusts and partnerships; the dilutive effects of issuing additional common shares; our ability to achieve projected results; and environmental requirements.  We undertake no obligation to update or supplement any forward-looking statements.  For further information, please refer to our filings with the Securities and Exchange Commission, particularly the section entitled “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2013.

1



Corporate Office Properties Trust
Equity Research Coverage
 
Firm
 
Senior Analyst
 
Phone
 
Email
 
 
 
 
 
 
 
Bank of America Merrill Lynch
 
Jamie Feldman
 
646-855-5808
 
james.feldman@baml.com
Capital One Securities
 
Chris Lucas
 
571-633-8151
 
christopher.lucas@capitalone.com
Citigroup Global Markets
 
Emmanuel Korchman
 
212-816-1382
 
emmanuel.korchman@citi.com
Cowen and Company
 
Jim Sullivan
 
646-562-1380
 
james.sullivan@cowen.com
Credit Suisse
 
Ian Weissman
 
917-846-3831
 
ian.weissman@credit-suisse.com
Evercore ISI
 
Steve Sakwa
 
212-446-9462
 
steve.sakwa@evercoreisi.com
Green Street Advisors
 
John Bejjani
 
949-640-8780
 
jbejjani@greenstreetadvisors.com
Jefferies & Co.
 
Tayo Okusanya
 
212-336-7076
 
tokusanya@jefferies.com
JP Morgan
 
Tony Paolone
 
212-622-6682
 
anthony.paolone@jpmorgan.com
KeyBanc Capital Markets
 
Craig Mailman
 
917-368-2316
 
cmailman@key.com
Mizuho Securities USA Inc.
 
Richard Anderson
 
212-205-8445
 
richard.anderson@us.mizuho-sc.com
Raymond James
 
Bill Crow
 
727-567-2594
 
bill.crow@raymondjames.com
RBC Capital Markets
 
Michael Carroll
 
440-715-2649
 
michael.carroll@rbccm.com
Robert W. Baird & Co., Inc.
 
Dave Rodgers
 
216-737-7341
 
drodgers@rwbaird.com
Stifel, Nicolaus & Company, Inc.
 
John Guinee
 
443-224-1307
 
jwguinee@stifel.com
SunTrust Robinson Humphrey, Inc.
 
Michael Lewis
 
212-319-5659
 
michael.lewis@suntrust.com
Wells Fargo Securities
 
Brendan Maiorana
 
443-263-6516
 
brendan.maiorana@wachovia.com
 
With the exception of Green Street Advisors, the above-listed firms are those whose analysts publish research material on the Company and whose estimates of our FFO per share can be tracked through Thomson’s First Call Corporation. Any opinions, estimates, or forecasts the above analysts make regarding COPT’s future performance are their own and do not represent the views, estimates, or forecasts of COPT’s management.

2


Corporate Office Properties Trust
Selected Financial Summary Data
(in thousands, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Years Ended
SUMMARY OF RESULTS 
 
12/31/14
 
9/30/14
 
6/30/14
 
3/31/14
 
12/31/13
 
12/31/14
 
12/31/13
Same Office NOI
 
$
68,861

 
$
67,941

 
$
67,086

 
$
65,705

 
$
66,162

 
$
269,593

 
$
267,742

NOI from real estate operations
 
$
77,301

 
$
75,359

 
$
72,108

 
$
75,144

 
$
79,621

 
$
299,912

 
$
317,929

Adjusted EBITDA
 
$
70,414

 
$
69,122

 
$
65,800

 
$
70,711

 
$
73,917

 
$
276,047

 
$
293,312

Net income attributable to COPT common shareholders
 
$
1,352

 
$
19,167

 
$
1,777

 
$
251

 
$
82,526

 
$
22,547

 
$
70,832

FFO - per NAREIT
 
$
37,345

 
$
49,655

 
$
41,273

 
$
49,272

 
$
115,911

 
$
177,545

 
$
242,306

FFO - as adjusted for comparability
 
$
50,957

 
$
48,151

 
$
47,034

 
$
49,295

 
$
49,958

 
$
195,437

 
$
203,602

Basic and diluted FFO available to common share and common unit holders
 
$
32,638

 
$
44,916

 
$
34,091

 
$
43,651

 
$
109,914

 
$
155,296

 
$
214,149

Diluted FFO available to common share and common unit holders, as adjusted for comparability
 
$
46,191

 
$
43,419

 
$
39,826

 
$
43,674

 
$
44,129

 
$
173,110

 
$
175,613

Diluted AFFO avail. to common share and common unit holders
 
$
40,136

 
$
28,977

 
$
27,561

 
$
36,507

 
$
28,362

 
$
133,181

 
$
142,173

Per share - diluted:
 
 

 
 

 
 

 
 

 
 

 
 

 
 
EPS
 
$
0.01

 
$
0.22

 
$
0.02

 
$
0.00

 
$
0.94

 
$
0.25

 
$
0.83

FFO - NAREIT
 
$
0.34

 
$
0.49

 
$
0.37

 
$
0.48

 
$
1.21

 
$
1.69

 
$
2.40

FFO - as adjusted for comparability
 
$
0.49

 
$
0.48

 
$
0.44

 
$
0.48

 
$
0.48

 
$
1.88

 
$
1.97

Dividend per common share
 
$
0.275

 
$
0.275

 
$
0.275

 
$
0.275

 
$
0.275

 
$
1.100

 
$
1.100

Payout ratios:
 
 

 
 

 
 

 
 

 
 

 
 

 
 
Diluted FFO
 
81.8
%
 
56.0
%
 
73.8
%
 
57.7
%
 
22.9
%
 
65.8
%
 
46.5
%
Diluted FFO - as adjusted for comparability
 
57.8
%
 
58.0
%
 
63.2
%
 
57.6
%
 
56.9
%
 
59.0
%
 
56.7
%
Diluted AFFO
 
66.5
%
 
86.9
%
 
91.3
%
 
69.0
%
 
88.6
%
 
76.7
%
 
70.0
%
Rental revenue operating margin
 
79.0
%
 
78.3
%
 
76.4
%
 
76.7
%
 
77.6
%
 
77.6
%
 
78.5
%
CAPITALIZATION
 
 

 
 

 
 
 
 

 
 

 
 

 
 
Total Market Capitalization
 
$
4,882,468

 
$
4,613,107

 
$
4,853,704

 
$
4,627,913

 
$
4,350,189

 
 
 
 
Total Equity Market Capitalization
 
$
2,962,411

 
$
2,563,115

 
$
2,754,361

 
$
2,696,082

 
$
2,422,486

 
 
 
 
Debt, net
 
$
1,920,057

 
$
2,049,992

 
$
2,099,343

 
$
1,931,831

 
$
1,927,703

 
 
 
 
Debt to Total Market Capitalization
 
39.3
%
 
44.4
%
 
43.3
%
 
41.7
%
 
44.3
%
 
 
 
 
Debt to Adjusted book
 
39.7
%
 
42.8
%
 
43.9
%
 
43.5
%
 
43.6
%
 
 
 
 
Adjusted EBITDA interest coverage ratio
 
4.0
x
 
3.6
x
 
3.7
x
 
3.6
x
 
3.3
x
 
3.7
x
 
3.5
x
Adjusted EBITDA debt service coverage ratio
 
3.7
x
 
3.4
x
 
3.4
x
 
3.3
x
 
3.0
x
 
3.4
x
 
3.1
x
Adjusted EBITDA fixed charge coverage ratio
 
2.8
x
 
2.7
x
 
2.6
x
 
2.6
x
 
2.4
x
 
2.7
x
 
2.4
x
Adjusted debt to in-place adjusted EBITDA ratio
 
6.3
x
 
6.7
x
 
7.1
x
 
6.8
x
 
6.8
x
 
N/A

 
N/A

OTHER
 
 

 
 

 
 

 
 

 
 

 
 

 
 
Revenue from early termination of leases
 
$
611

 
$
239

 
$
72

 
$
1,112

 
$
1,676

 
$
2,034

 
$
4,682

Capitalized interest costs
 
$
1,740

 
$
1,314

 
$
1,422

 
$
1,589

 
$
2,042

 
$
6,065

 
$
8,785



3


Corporate Office Properties Trust
Selected Consolidated Portfolio Data (1)
 
 
 
 
 
 
 
 
 
 
 
 
12/31/14
 
9/30/14
 
6/30/14
 
3/31/14
 
12/31/13
 
 
 

 
 

 
 

 
 

 
 

 
# of Operating Office Properties
 
 
 
 
 
 
 
 
 
 
Total Portfolio
173

 
174

 
180

 
183

 
183

 
Core Portfolio
173

 
174

 
172

 
181

 
177

 
Same Office Properties
160

 
160

 
160

 
160

 
160

 
 
 
 
 
 
 
 
 
 
 
 
% Occupied
 
 
 
 
 
 
 
 
 
 
Total Portfolio
90.9
%
 
91.5
%
 
89.3
%
 
89.8
%
 
89.1
%
 
Core Portfolio
90.9
%
 
91.5
%
 
90.0
%
 
89.7
%
 
88.7
%
 
Same Office Properties
91.3
%
 
92.5
%
 
91.2
%
 
91.5
%
 
91.0
%
 
 
 
 
 
 
 
 
 
 
 
 
% Leased
 
 
 
 
 
 
 
 
 
 
Total Portfolio
92.4
%
 
93.0
%
 
91.4
%
 
91.1
%
 
90.3
%
 
Core Portfolio
92.4
%
 
93.0
%
 
92.2
%
 
91.0
%
 
90.0
%
 
Same Office Properties
92.5
%
 
93.7
%
 
93.3
%
 
93.0
%
 
92.3
%
 
 
 
 
 
 
 
 
 
 
 
 
Square Feet of Office Properties (in thousands)
 
 
 
 
 
 
 
 
 
 
Total Portfolio
16,790

 
16,863

 
16,923

 
17,473

 
17,370

 
Core Portfolio
16,790

 
16,863

 
16,620

 
16,808

 
16,045

 
Same Office Properties
15,019

 
15,019

 
15,019

 
15,019

 
15,019

 
 
 
 
 
 
 
 
 
 
 
 
Wholesale Data Center
 
 
 
 
 
 
 
 
 
 
Initial Stabilization Critical Load (in megawatts (“MWs”))
18

 
18

 
18

 
18

 
18

 
MWs Operational
9

 
9

 
9

 
9

 
9

 
MWs Leased
6.56

 
6.26

 
6.26

 
6.26

 
6.26

 
 
 
 
 
 
 
 
 
 
 
 

(1)
Amounts reported exclude the effect of properties serving as collateral for debt which is in default that we expect to extinguish via conveyance of such properties. Effective April 1, 2014, all cash flows from such properties belong to the lender.

4


Corporate Office Properties Trust
Quarterly Consolidated Balance Sheets
(dollars in thousands)
 
12/31/14
 
9/30/14
 
6/30/14
 
3/31/14
 
12/31/13
Assets
 

 
 

 
 

 
 

 
 

Properties, net
 

 
 

 
 

 
 

 
 

Operating properties, net
$
2,751,488

 
$
2,757,207

 
$
2,724,242

 
$
2,729,003

 
$
2,702,693

Construction and redevelopment in progress, including land (1)
222,146

 
167,618

 
168,996

 
159,468

 
160,436

Land held for future development (1)
323,280

 
346,331

 
361,004

 
336,157

 
351,172

Total properties, net
3,296,914

 
3,271,156

 
3,254,242

 
3,224,628

 
3,214,301

Assets held for sale
14,339

 

 
22,868

 

 

Cash and cash equivalents
6,077

 
40,018

 
76,216

 
18,374

 
54,373

Restricted cash and marketable securities
9,069

 
14,371

 
11,689

 
10,965

 
11,448

Accounts receivable, net
26,901

 
20,180

 
30,911

 
30,152

 
27,000

Deferred rent receivable, net
95,910

 
95,405

 
93,270

 
91,082

 
89,456

Intangible assets on real estate acquisitions, net
43,854

 
48,300

 
51,645

 
55,678

 
59,258

Deferred leasing and financing costs, net
64,797

 
65,009

 
65,251

 
65,855

 
66,267

Mortgage and other investing receivables
52,147

 
50,886

 
56,549

 
55,231

 
53,663

Prepaid expenses and other assets
60,249

 
74,863

 
46,859

 
53,932

 
54,186

Total assets
$
3,670,257

 
$
3,680,188

 
$
3,709,500

 
$
3,605,897

 
$
3,629,952

Liabilities and equity
 

 
 

 
 

 
 

 
 

Liabilities:
 

 
 

 
 

 
 

 
 

Debt, net
$
1,920,057

 
$
2,049,992

 
$
2,099,343

 
$
1,931,831

 
$
1,927,703

Accounts payable and accrued expenses
123,035

 
123,893

 
105,205

 
97,451

 
98,785

Rents received in advance and security deposits
31,011

 
33,075

 
27,520

 
28,267

 
31,492

Dividends and distributions payable
29,862

 
28,344

 
28,342

 
29,122

 
29,080

Deferred revenue associated with operating leases
13,031

 
13,420