UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
|
x |
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the quarterly period ended March 31, 2016
or
|
o |
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the transition period from to
Commission file number
001-9106 (Brandywine Realty Trust)
000-24407 (Brandywine Operating Partnership, L.P.)
Brandywine Realty Trust
Brandywine Operating Partnership, L.P.
(Exact name of registrant as specified in its charter)
|
MARYLAND (Brandywine Realty Trust) |
|
23-2413352 |
|
DELAWARE (Brandywine Operating Partnership L.P.) |
|
23-2862640 |
|
(State or other jurisdiction of |
|
(I.R.S. Employer |
|
incorporation or organization) |
|
Identification No.) |
|
|
|
|
|
555 East Lancaster Avenue |
|
|
|
Radnor, Pennsylvania |
|
19087 |
|
(Address of principal executive offices) |
|
(Zip Code) |
Registrant’s telephone number, including area code (610) 325-5600
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
|
Brandywine Realty Trust |
|
Yes x No o |
|
Brandywine Operating Partnership, L.P. |
|
Yes x No o |
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
|
Brandywine Realty Trust |
|
Yes x No o |
|
Brandywine Operating Partnership, L.P. |
|
Yes x No o |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, "accelerated filer", and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Brandywine Realty Trust:
|
Large accelerated filer x |
|
Accelerated filer o |
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Non-accelerated filer o |
|
Smaller reporting company o |
Brandywine Operating Partnership, L.P.:
|
Large accelerated filer o |
|
Accelerated filer o |
|
Non-accelerated filer x |
|
Smaller reporting company o |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
|
Brandywine Realty Trust |
|
Yes o No x |
|
Brandywine Operating Partnership, L.P. |
|
Yes o No x |
A total of 175,015,396 Common Shares of Beneficial Interest, par value $0.01 per share of Brandywine Realty Trust, were outstanding as of April 22, 2016.
This report combines the quarterly reports on Form 10-Q for the period ended March 31, 2016 of Brandywine Realty Trust (the “Parent Company”) and Brandywine Operating Partnership L.P. (the “Operating Partnership”). The Parent Company is a Maryland real estate investment trust, or REIT, that owns its assets and conducts its operations through the Operating Partnership, a Delaware limited partnership, and subsidiaries of the Operating Partnership. The Parent Company, the Operating Partnership and their consolidated subsidiaries are collectively referred to in this report as the “Company”. In addition, as used in this report, terms such as “we”, “us”, and “our” may refer to the Company, the Parent Company, or the Operating Partnership.
The Parent Company is the sole general partner of the Operating Partnership and, as of March 31, 2016, owned a 99.1% interest in the Operating Partnership. The remaining 0.9% interest consists of common units of limited partnership interest issued by the Operating Partnership to third parties in exchange for contributions of properties to the Operating Partnership. As the sole general partner of the Operating Partnership, the Parent Company has full and complete authority over the Operating Partnership’s day-to-day operations and management.
Management operates the Parent Company and the Operating Partnership as one enterprise. The management of the Parent Company consists of the same members as the management of the Operating Partnership.
As general partner with control of the Operating Partnership, the Parent Company consolidates the Operating Partnership for financial reporting purposes, and the Parent Company does not have significant assets other than its investment in the Operating Partnership. Therefore, the assets and liabilities of the Parent Company and the Operating Partnership are the same on their respective financial statements. The separate discussions of the Parent Company and the Operating Partnership in this report should be read in conjunction with each other to understand the results of the Company's operations on a consolidated basis and how management operates the Company.
The Company believes that combining the quarterly reports on Form 10-Q of the Parent Company and the Operating Partnership into a single report will result in the following benefits:
|
|
· |
facilitate a better understanding by the investors of the Parent Company and the Operating Partnership by enabling them to view the business as a whole in the same manner as management views and operates the business; |
|
|
· |
remove duplicative disclosures and provide a more straightforward presentation in light of the fact that a substantial portion of the disclosure applies to both the Parent Company and the Operating Partnership; and |
|
|
· |
create time and cost efficiencies through the preparation of one combined report instead of two separate reports. |
There are few differences between the Parent Company and the Operating Partnership, which are reflected in the footnote disclosures in this report. The Company believes it is important to understand the differences between the Parent Company and the Operating Partnership in the context of how these entities operate as an interrelated consolidated company. The Parent Company is a REIT, whose only material asset is its ownership of partnership interests of the Operating Partnership. As a result, the Parent Company does not conduct business itself, other than acting as the sole general partner of the Operating Partnership, issuing equity from time to time and guaranteeing the debt obligations of the Operating Partnership. The Operating Partnership holds substantially all the assets of the Company and directly or indirectly holds the ownership interests in the Company’s Real Estate Ventures. The Operating Partnership conducts the operations of the Company’s business and is structured as a partnership with no publicly traded equity. Except for net proceeds from equity issuances by the Parent Company, which are contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates the capital required by the Company’s business through the Operating Partnership’s operations, by the Operating Partnership’s incurrence of indebtedness (directly and through subsidiaries) and through the issuance of partnership units of the Operating Partnership or equity interests in subsidiaries of the Operating Partnership.
The equity and non-controlling interests in the Parent Company and the Operating Partnership’s equity are the main areas of difference between the consolidated financial statements of the Parent Company and the Operating Partnership. The common units of limited partnership interest in the Operating Partnership are accounted for as partners’ equity in the Operating Partnership’s financial statements while the common units of limited partnership interests held by parties other than the Parent Company are presented as non-controlling interests in the Parent Company’s financial statements. The differences between the Parent Company and the Operating Partnership’s equity relate to the differences in the equity issued at the Parent Company and Operating Partnership levels.
2
To help investors understand the significant differences between the Parent Company and the Operating Partnership, this report presents the following as separate notes or sections for each of the Parent Company and the Operating Partnership:
|
|
· |
Consolidated Financial Statements; and |
|
|
· |
Notes to the Parent Company’s and Operating Partnership’s Equity. |
This report also includes separate Item 4. (Controls and Procedures) disclosures and separate Exhibit 31 and 32 certifications for each of the Parent Company and the Operating Partnership in order to establish that the Chief Executive Officer and the Chief Financial Officer of each entity have made the requisite certifications and that the Parent Company and Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. § 1350.
In order to highlight the differences between the Parent Company and the Operating Partnership, the separate sections in this report for the Parent Company and the Operating Partnership specifically refer to the Parent Company and the Operating Partnership. In the sections that combine disclosures of the Parent Company and the Operating Partnership, this report refers to such disclosures as those of the Company. Although the Operating Partnership is generally the entity that directly or indirectly enters into contracts and real estate ventures and holds assets and incurs debt, reference to the Company is appropriate because the business is one enterprise and the Parent Company operates the business through the Operating Partnership.
3
TABLE OF CONTENTS
Filing Format
This combined Form 10-Q is being filed separately by Brandywine Realty Trust and Brandywine Operating Partnership, L.P.
4
PART I - FINANCIAL INFORMATION
Item 1. — Financial Statements
(in thousands, except share and per share information)
|
|
|
March 31, |
|
|
December 31, |
|
||
|
|
|
2016 |
|
|
2015 |
|
||
|
ASSETS |
|
(unaudited) |
|
|
|
|
|
|
|
Real estate investments: |
|
|
|
|
|
|
|
|
|
Operating properties |
|
$ |
3,703,193 |
|
|
$ |
3,693,000 |
|
|
Accumulated depreciation |
|
|
(891,263 |
) |
|
|
(867,035 |
) |
|
Operating real estate investments, net |
|
|
2,811,930 |
|
|
|
2,825,965 |
|
|
Construction-in-progress |
|
|
319,656 |
|
|
|
268,983 |
|
|
Land held for development |
|
|
132,747 |
|
|
|
130,479 |
|
|
Total real estate investments, net |
|
|
3,264,333 |
|
|
|
3,225,427 |
|
|
Cash and cash equivalents |
|
|
423,517 |
|
|
|
56,694 |
|
|
Accounts receivable, net of allowance of $1,950 and $1,736 in 2016 and 2015, respectively |
|
|
14,027 |
|
|
|
17,126 |
|
|
Accrued rent receivable, net of allowance of $13,313 and $14,442 in 2016 and 2015, respectively |
|
|
133,720 |
|
|
|
145,092 |
|
|
Assets held for sale, net |
|
|
- |
|
|
|
584,365 |
|
|
Investment in Real Estate Ventures, equity method |
|
|
278,659 |
|
|
|
241,004 |
|
|
Deferred costs, net |
|
|
90,973 |
|
|
|
101,419 |
|
|
Intangible assets, net |
|
|
100,063 |
|
|
|
111,623 |
|
|
Other assets |
|
|
72,772 |
|
|
|
71,761 |
|
|
Total assets |
|
$ |
4,378,064 |
|
|
$ |
4,554,511 |
|
|
LIABILITIES AND BENEFICIARIES' EQUITY |
|
|
|
|
|
|
|
|
|
Mortgage notes payable, net |
|
|
345,310 |
|
|
|
545,753 |
|
|
Unsecured term loans, net |
|
|
247,882 |
|
|
|
247,800 |
|
|
Unsecured senior notes, net |
|
|
1,591,756 |
|
|
|
1,591,164 |
|
|
Accounts payable and accrued expenses |
|
|
112,203 |
|
|
|
99,856 |
|
|
Distributions payable |
|
|
28,295 |
|
|
|
28,249 |
|
|
Deferred income, gains and rent |
|
|
27,331 |
|
|
|
30,413 |
|
|
Acquired lease intangibles, net |
|
|
23,248 |
|
|
|
25,655 |
|
|
Liabilities related to assets held for sale |
|
|
- |
|
|
|
2,151 |
|
|
Other liabilities |
|
|
37,749 |
|
|
|
31,379 |
|
|
Total liabilities |
|
$ |
2,413,774 |
|
|
$ |
2,602,420 |
|
|
Commitments and contingencies (See Note 14) |
|
|
|
|
|
|
|
|
|
Brandywine Realty Trust's Equity: |
|
|
|
|
|
|
|
|
|
Preferred Shares (shares authorized-20,000,000) |
|
|
|
|
|
|
|
|
|
6.90% Series E Preferred Shares, $0.01 par value; issued and outstanding- 4,000,000 in 2016 and 2015 |
|
|
40 |
|
|
|
40 |
|
|
Common Shares of Brandywine Realty Trust's beneficial interest, $0.01 par value; shares authorized 400,000,000; 174,890,432 and 174,688,568 issued and outstanding in 2016 and 2015, respectively |
|
|
1,749 |
|
|
|
1,747 |
|
|
Additional paid-in-capital |
|
|
3,255,908 |
|
|
|
3,252,622 |
|
|
Deferred compensation payable in common shares |
|
|
13,155 |
|
|
|
11,918 |
|
|
Common shares in grantor trust, 847,007 in 2016, 745,686 in 2015 |
|
|
(13,155 |
) |
|
|
(11,918 |
) |
|
Cumulative earnings |
|
|
545,041 |
|
|
|
499,086 |
|
|
Accumulated other comprehensive loss |
|
|
(14,271 |
) |
|
|
(5,192 |
) |
|
Cumulative distributions |
|
|
(1,842,450 |
) |
|
|
(1,814,378 |
) |
|
Total Brandywine Realty Trust's equity |
|
|
1,946,017 |
|
|
|
1,933,925 |
|
|
Non-controlling interests |
|
|
18,273 |
|
|
|
18,166 |
|
|
Total beneficiaries' equity |
|
|
1,964,290 |
|
|
|
1,952,091 |
|
|
Total liabilities and beneficiaries' equity |
|
$ |
4,378,064 |
|
|
$ |
4,554,511 |
|
The accompanying notes are an integral part of these consolidated financial statements.
5
BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share information)
|
|
Three-month periods ended |
|
|||||
|
|
March 31, |
|
|||||
|
|
2016 |
|
|
2015 |
|
||
|
Revenue |
|
|
|
|
|
|
|
|
Rents |
$ |
110,163 |
|
|
$ |
120,410 |
|
|
Tenant reimbursements |
|
20,054 |
|
|
|
22,654 |
|
|
Termination fees |
|
294 |
|
|
|
636 |
|
|
Third party management fees, labor reimbursement and leasing |
|
5,235 |
|
|
|
3,872 |
|
|
Other |
|
756 |
|
|
|
2,834 |
|
|
Total revenue |
|
136,502 |
|
|
|
150,406 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Property operating expenses |
|
40,879 |
|
|
|
46,577 |
|
|
Real estate taxes |
|
11,886 |
|
|
|
12,545 |
|
|
Third party management expenses |
|
2,010 |
|
|
|
1,576 |
|
|
Depreciation and amortization |
|
48,873 |
|
|
|
51,111 |
|
|
General and administrative expenses |
|
9,120 |
|
|
|
8,636 |
|
|
Provision for impairment |
|
7,390 |
|
|
|
1,726 |
|
|
Total operating expenses |
|
120,158 |
|
|
|
122,171 |
|
|
Operating income |
|
16,344 |
|
|
|
28,235 |
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
Interest income |
|
320 |
|
|
|
750 |
|
|
Interest expense |
|
(23,691 |
) |
|
|
(28,176 |
) |
|
Interest expense - amortization of deferred financing costs |
|
(774 |
) |
|
|
(1,079 |
) |
|
Interest expense - financing obligation |
|
(281 |
) |
|
|
(286 |
) |
|
Equity in income (loss) of Real Estate Ventures |
|
(403 |
) |
|
|
131 |
|
|
Net gain on disposition of real estate |
|
115,456 |
|
|
|
9,019 |
|
|
Net gain on real estate venture transactions |
|
5,929 |
|
|
|
- |
|
|
Loss on early extinguishment of debt |
|
(66,590 |
) |
|
|
- |
|
|
Net income |
|
46,310 |
|
|
|
8,594 |
|
|
Net income attributable to non-controlling interests |
|
(389 |
) |
|
|
(58 |
) |
|
Net income attributable to Brandywine Realty Trust |
|
45,921 |
|
|
|
8,536 |
|
|
Distribution to preferred shareholders |
|
(1,725 |
) |
|
|
(1,725 |
) |
|
Nonforfeitable dividends allocated to unvested restricted shareholders |
|
(105 |
) |
|
|
(101 |
) |
|
Net income attributable to Common Shareholders of Brandywine Realty Trust |
$ |
44,091 |
|
|
$ |
6,710 |
|
|
|
|
|
|
|
|
|
|
|
Basic income per Common Share: |
|
|
|
|
|
|
|
|
Continuing operations |
$ |
0.25 |
|
|
$ |
0.04 |
|
|
|
|
|
|
|
|
|
|
|
Diluted income per Common Share: |
|
|
|
|
|
|
|
|
Continuing operations |
$ |
0.25 |
|
|
$ |
0.04 |
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average shares outstanding |
|
174,788,945 |
|
|
|
179,562,930 |
|
|
Diluted weighted average shares outstanding |
|
175,471,413 |
|
|
|
180,655,272 |
|
|
|
|
|
|
|
|
|
|
|
Distributions declared per Common Share |
$ |
0.15 |
|
|
$ |
0.15 |
|
The accompanying notes are an integral part of these consolidated financial statements.
6
BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited, in thousands)
|
|
Three-month periods ended |
|
|||||
|
|
March 31, |
|
|||||
|
|
2016 |
|
|
2015 |
|
||
|
Net income |
$ |
46,310 |
|
|
$ |
8,594 |
|
|
Comprehensive loss: |
|
|
|
|
|
|
|
|
Unrealized loss on derivative financial instruments |
|
(9,405 |
) |
|
|
(2,663 |
) |
|
Reclassification of realized losses on derivative financial instruments to operations, net (1) |
|
246 |
|
|
|
58 |
|
|
Total comprehensive loss |
|
(9,159 |
) |
|
|
(2,605 |
) |
|
Comprehensive income |
|
37,151 |
|
|
|
5,989 |
|
|
Comprehensive loss attributable to non-controlling interest |
|
(309 |
) |
|
|
(36 |
) |
|
Comprehensive income attributable to Brandywine Realty Trust |
$ |
36,842 |
|
|
$ |
5,953 |
|
|
(1) |
Amounts reclassified from comprehensive income to interest expense within the Consolidated Statements of Operations. |
The accompanying notes are an integral part of these consolidated financial statements.
7
BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF BENEFICIARIES’ EQUITY
For the three-month period ended March 31, 2016
(unaudited, in thousands, except number of shares)
|
March 31, 2016 |
|
||||||||||||||||||||||||||||||||||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Preferred Shares |
|
|
Par Value of Preferred Shares |
|
|
Number of Common Shares |
|
|
Number of Rabbi Trust/Deferred Compensation Shares |
|
|
Common Shares of Brandywine Realty Trust's beneficial interest |
|
|
Additional Paid-in Capital |
|
|
Deferred Compensation Payable in Common Shares |
|
|
Common Shares in Grantor Trust |
|
|
Cumulative Earnings |
|
|
Accumulated Other Comprehensive Loss |
|
|
Cumulative Distributions |
|
|
Non-Controlling Interests |
|
|
Total |
|
|||||||||||||
|
BALANCE, December 31, 2015 |
|
4,000,000 |
|
|
$ |
40 |
|
|
|
174,688,568 |
|
|
|
745,686 |
|
|
$ |
1,747 |
|
|
$ |
3,252,622 |
|
|
$ |
11,918 |
|
|
$ |
(11,918 |
) |
|
$ |
499,086 |
|
|
$ |
(5,192 |
) |
|
$ |
(1,814,378 |
) |
|
$ |
18,166 |
|
|
$ |
1,952,091 |
|
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
45,921 |
|
|
|
|
|
|
|
|
|
|
|
389 |
|
|
|
46,310 |
|
|
Other comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(9,079 |
) |
|
|
|
|
|
|
(80 |
) |
|
|
(9,159 |
) |
|
Issuance of partnership interest in consolidated real estate venture |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18 |
|
|
|
18 |
|
|
Share-based compensation activity |
|
|
|
|
|
|
|
|
|
210,116 |
|
|
|
|
|
|
|
2 |
|
|
|
3,296 |
|
|
|
|
|
|
|
|
|
|
|
34 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,332 |
|
|
Share Issuance from/to Deferred Compensation Plan |
|
|
|
|
|
|
|
|
|
(8,252 |
) |
|
|
101,321 |
|
|
|
|
|
|
|
|
|
|
|
1,237 |
|
|
|
(1,237 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
Adjustment to Non-controlling Interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(10 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10 |
|
|
|
- |
|
|
Preferred Share distributions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,725 |
) |
|
|
|
|
|
|
(1,725 |
) |
|
Distributions declared (0.15 share) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(26,347 |
) |
|
|
(230 |
) |
|
|
(26,577 |
) |
|
BALANCE, March 31, 2016 |
|
4,000,000 |
|
|
$ |
40 |
|
|
|
174,890,432 |
|
|
|
847,007 |
|
|
$ |
1,749 |
|
|
$ |
3,255,908 |
|
|
$ |
13,155 |
|
|
$ |
(13,155 |
) |
|
$ |
545,041 |
|
|
$ |
(14,271 |
) |
|
$ |
(1,842,450 |
) |
|
$ |
18,273 |
|
|
$ |
1,964,290 |
|
The accompanying notes are an integral part of these consolidated financial statements.
8
BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENT OF BENEFICIARIES’ EQUITY
For the three-month period ended March 31, 2015
(unaudited, in thousands, except number of shares)
|
March 31, 2015 |
|
||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Preferred Shares |
|
|
Par Value of Preferred Shares |
|
|
Number of Common Shares |
|
|
Number of Rabbi Trust/Deferred Compensation Shares |
|
|
Common Shares of Brandywine Realty Trust's beneficial interest |
|
|
Additional Paid-in Capital |
|
|
Deferred Compensation Payable in Common Shares |
|
|
Common Shares in Grantor Trust |
|
|
Cumulative Earnings |
|
|
Accumulated Other Comprehensive Loss |
|
|
Cumulative Distributions |
|
|
Non-Controlling Interests |
|
|
Total |
|
|||||||||||||
|
BALANCE, December 31, 2014 |
|
4,000,000 |
|
|
$ |
40 |
|
|
|
179,293,160 |
|
|
|
384,536 |
|
|
$ |
1,793 |
|
|
$ |
3,314,693 |
|
|
$ |
6,219 |
|
|
$ |
(6,219 |
) |
|
$ |
529,487 |
|
|
$ |
(4,607 |
) |
|
$ |
(1,700,579 |
) |
|
$ |
18,499 |
|
|
$ |
2,159,326 |
|
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,536 |
|
|
|
|
|
|
|
|
|
|
|
58 |
|
|
|
8,594 |
|
|
Other comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,583 |
) |
|
|
|
|
|
|
(22 |
) |
|
|
(2,605 |
) |
|
Bonus share issuance |
|
|
|
|
|
|
|
|
|
8,447 |
|
|
|
|
|
|
|
|
|
|
|
125 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
125 |
|
|
Equity issuance costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(48 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(48 |
) |
|
Share-based compensation activity |
|
|
|
|
|
|
|
|
|
410,506 |
|
|
|
280,011 |
|
|
|
5 |
|
|
|
2,347 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,352 |
|
|
Share Issuance from/to Deferred Compensation Plan |
|
|
|
|
|
|
|
|
|
33,485 |
|
|
|
30,144 |
|
|
|
|
|
|
|
|
|
|
|
4,975 |
|
|
|
(4,975 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
Adjustment to Non-controlling Interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(20 |
) |
|
|
- |
|
|
Preferred Share distributions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,725 |
) |
|
|
|
|
|
|
(1,725 |
) |
|
Distributions declared (0.15 share) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(27,213 |
) |
|
|
(230 |
) |
|
|
(27,443 |
) |
|
BALANCE, March 31, 2015 |
|
4,000,000 |
|
|
$ |
40 |
|
|
|
179,745,598 |
|
|
|
694,691 |
|
|
$ |
1,798 |
|
|
$ |
3,317,137 |
|
|
$ |
11,194 |
|
|
$ |
(11,194 |
) |
|
$ |
538,023 |
|
|
$ |
(7,190 |
) |
|
$ |
(1,729,517 |
) |
|
$ |
18,285 |
|
|
$ |
2,138,576 |
|
The accompanying notes are an integral part of these consolidated financial statements.
9
BRANDYWINE REALTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
|
|
|
Three-month periods ended |
|
|||||
|
|
|
March 31, |
|
|||||
|
|
|
2016 |
|
|
2015 |
|
||
|
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
46,310 |
|
|
$ |
8,594 |
|
|
Adjustments to reconcile net income to net cash from operating activities: |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
48,873 |
|
|
|
51,111 |
|
|
Amortization of deferred financing costs |
|
|
774 |
|
|
|
1,079 |
|
|
Amortization of debt discount/(premium), net |
|
|
382 |
|
|
|
(158 |
) |
|
Amortization of stock compensation costs |
|
|
2,296 |
|
|
|
2,756 |
|
|
Shares used for employee taxes upon vesting of share awards |
|
|
(289 |
) |
|
|
(1,359 |
) |
|
Straight-line rent income |
|
|
(6,104 |
) |
|
|
(6,339 |
) |
|
Amortization of acquired above (below) market leases, net |
|
|
(2,232 |
) |
|
|
(1,290 |
) |
|
Straight-line ground rent expense |
|
|
22 |
|
|
|
22 |
|
|
Provision for doubtful accounts |
|
|
215 |
|
|
|
380 |
|
|
Net gain on real estate venture transactions |
|
|
(5,929 |
) |
|
|
- |
|
|
Net gain on sale of interests in real estate |
|
|
(115,456 |
) |
|
|
(9,019 |
) |
|
Loss on early extinguishment of debt - deferred financing costs |
|
|
13,157 |
|
|
|
- |
|
|
Provision for impairment |
|
|
7,390 |
|
|
|
1,726 |
|
|
Real Estate Venture loss in excess of distributions |
|
|
723 |
|
|
|
163 |
|
|
Deferred financing obligation |
|
|
(253 |
) |
|
|
(287 |
) |
|
Changes in assets and liabilities |
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
246 |
|
|
|
(170 |
) |
|
Other assets |
|
|
(9,193 |
) |
|
|
(9,322 |
) |
|
Accounts payable and accrued expenses |
|
|
6,296 |
|
|
|
11,131 |
|
|
Deferred income, gains and rent |
|
|
(2,308 |
) |
|
|
(3,267 |
) |
|
Other liabilities |
|
|
552 |
|
|
|
(140 |
) |
|
Net cash (used in) provided by operating activities |
|
|
(14,528 |
) |
|
|
45,611 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
|
Proceeds from the sale of properties |
|
|
704,911 |
|
|
|
26,778 |
|
|
Distribution of sale proceeds from a real estate venture |
|
|
4,812 |
|
|
|
- |
|
|
Proceeds from repayment of mortgage notes receivable |
|
|
- |
|
|
|
88,000 |
|
|
Capital expenditures for tenant improvements |
|
|
(13,949 |
) |
|
|
(14,515 |
) |
|
Capital expenditures for redevelopments |
|
|
(6,199 |
) |
|
|
(5,984 |
) |
|
Capital expenditures for developments |
|
|
(54,405 |
) |
|
|
(37,867 |
) |
|
Advances for the purchase of tenant assets, net of repayments |
|
|
360 |
|
|
|
(138 |
) |
|
Investment in unconsolidated Real Estate Ventures |
|
|
(14,414 |
) |
|
|
(11,028 |
) |
|
Deposits for real estate |
|
|
(2,275 |
) |
|
|
(5,995 |
) |
|
Escrowed cash |
|
|
6,991 |
|
|
|
2,868 |
|
|
Cash distribution from unconsolidated Real Estate Ventures in excess of cumulative equity income |
|
|
1,436 |
|
|
|
2,563 |
|
|
Leasing costs paid |
|
|
(4,716 |
) |
|
|
(6,371 |
) |
|
Net cash provided from investing activities |
|
|
622,552 |
|
|
|
38,311 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
|
Repayments of mortgage notes payable |
|
|
(213,739 |
) |
|
|
(3,546 |
) |
|
Proceeds from credit facility borrowings |
|
|
195,000 |
|
|
|
- |
|
|
Repayments of credit facility borrowings |
|
|
(195,000 |
) |
|
|
- |
|
|
Debt financing costs paid |
|
|
(72 |
) |
|
|
- |
|
|
Proceeds from the exercise of stock options |
|
|
826 |
|
|
|
127 |
|
|
Partner contribution to consolidated real estate venture |
|
|
18 |
|
|
|
- |
|
|
Distributions paid to shareholders |
|
|
(28,004 |
) |
|
|
(28,692 |
) |
|
Distributions to non-controlling interest |
|
|
(230 |
) |
|
|
(230 |
) |
|
Net cash used in financing activities |
|
|
(241,201 |
) |
|
|
(32,341 |
) |
|
Increase in cash and cash equivalents |
|
|
366,823 |
|
|
|
51,581 |
|
|
Cash and cash equivalents at beginning of year |
|
|
56,694 |
|
|
|
257,502 |
|
|
Cash and cash equivalents at end of year |
|
$ |
423,517 |
|
|
$ |
309,083 |
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental disclosure: |
|
|
|
|
|
|
|
|
|
Cash paid for interest, net of capitalized interest during the three months ended March 31, 2016 and 2015 of $3,671 and $2,703, respectively |
|
$ |
13,656 |
|
|
$ |
18,080 |
|
|
|
|
|
|
|||||