Paramount Announces Second Quarter 2019 Results

– Leases over 1,049,000 square feet through June –

– Raises Guidance for Full Year 2019 –

NEW YORK--()--Paramount Group, Inc. (NYSE: PGRE) (“Paramount” or the “Company”) filed its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 today and reported results for the second quarter ended June 30, 2019.

Second Quarter Highlights:

  • Reported net income attributable to common stockholders of $2.5 million, or $0.01 per diluted share, for the quarter ended June 30, 2019, compared to a net loss of $34.8 million, or $0.14 per diluted share, for the quarter ended June 30, 2018.
  • Reported Core Funds from Operations (“Core FFO”) attributable to common stockholders of $53.2 million, or $0.23 per diluted share, for the quarter ended June 30, 2019, compared to $57.9 million, or $0.24 per diluted share, for the quarter ended June 30, 2018.
  • Reported an 8.3% increase in Same Store Cash Net Operating Income (“NOI”) and a 0.6% increase in Same Store NOI in the quarter ended June 30, 2019, compared to the same period in the prior year.
  • Updated its full year 2019 Earnings Guidance as follows:
    • Estimated net income attributable to common stockholders is expected to be between $0.03 and $0.07 per diluted share, compared to its prior estimate of net income attributable to common stockholders of $0.01 to $0.05 per diluted share, up $0.02 per diluted share from the midpoint of the Company’s prior estimate.
    • Estimated Core FFO attributable to common stockholders is expected to be between $0.93 and $0.97 per diluted share, compared to its prior estimate of $0.90 to $0.94 per diluted share, up $0.03 per diluted share from the midpoint of the Company’s prior guidance.
  • Leased 696,497 square feet, of which the Company’s share was 497,300 square feet that was leased at a weighted average initial rent of $89.38 per square foot. Of the square footage leased, 488,092 square feet represented second generation space, for which the Company achieved a positive mark-to-market of 25.0% on a cash basis and 21.6% on a GAAP basis.
  • Increased leased occupancy and same store leased occupancy by 70 basis points to 96.7% at June 30, 2019 from 96.0% at March 31, 2019.
  • Entered into an agreement to acquire 55 Second Street, a 387,000 square foot office building located in San Francisco, California for approximately $408 million. The transaction, which is subject to customary closing conditions, is expected to close at the end of the third quarter of 2019 and the Company intends to bring in a joint venture partner prior to closing.
  • Repurchased 889,549 common shares for an aggregate price of $12.2 million, or a weighted average price of $13.68 per share, including 474,500 shares that were repurchased during the quarter ended June 30, 2019.
  • Declared a second quarter cash dividend of $0.10 per common share on June 14, 2019, which was paid on July 15, 2019.

Financial Results

Quarter Ended June 30, 2019

Net income attributable to common stockholders was $2.5 million, or $0.01 per diluted share, for the quarter ended June 30, 2019, compared to a net loss of $34.8 million, or $0.14 per diluted share, for the quarter ended June 30, 2018. Net loss attributable to common stockholders for the quarter ended June 30, 2018, included a $41.6 million, or $0.17 per diluted share, real estate impairment loss.

Funds from Operations (“FFO”) attributable to common stockholders was $54.2 million, or $0.23 per diluted share, for the quarter ended June 30, 2019, compared to $58.9 million, or $0.25 per diluted share, for the quarter ended June 30, 2018. FFO attributable to common stockholders for the quarters ended June 30, 2019 and 2018 includes the impact of non-core items, which are listed in the table on page 9. The aggregate of these items, net of amounts attributable to noncontrolling interests, increased FFO attributable to common stockholders for the quarter ended June 30, 2019 and 2018 by $1.0 million, or $0.00 and $0.01 per diluted share, respectively.

Core FFO attributable to common stockholders, which excludes the impact of the non-core items listed on page 9, was $53.2 million, or $0.23 per diluted share, for the quarter ended June 30, 2019, compared to $57.9 million, or $0.24 per diluted share, for the quarter ended June 30, 2018.

Six Months Ended June 30, 2019

Net income attributable to common stockholders was $6.2 million, or $0.03 per diluted share, for the six months ended June 30, 2019, compared to a net loss of $33.7 million, or $0.14 per diluted share, for the six months ended June 30, 2018. Net loss attributable to common stockholders for the six months ended June 30, 2018, included a $41.6 million, or $0.17 per diluted share, real estate impairment loss.

FFO attributable to common stockholders was $109.4 million, or $0.47 per diluted share, for the six months ended June 30, 2019, compared to $112.6 million, or $0.47 per diluted share, for the six months ended June 30, 2018. FFO attributable to common stockholders for the six months ended June 30, 2019 and 2018 includes the impact of non-core items, which are listed in the table on page 9. The aggregate of these items, net of amounts attributable to noncontrolling interests, decreased FFO attributable to common stockholders for the six months ended June 30, 2019 and 2018 by $1.0 million and $0.3 million, respectively, or $0.00 per diluted share.

Core FFO attributable to common stockholders, which excludes the impact of the non-core items listed on page 9, was $110.4 million, or $0.47 per diluted share, for the six months ended June 30, 2019, compared to $112.9 million, or $0.47 per diluted share, for the six months ended June 30, 2018.

Portfolio Operations

Quarter Ended June 30, 2019

Same Store Cash NOI increased by $7.0 million, or 8.3%, to $91.0 million for the quarter ended June 30, 2019 from $84.0 million for the quarter ended June 30, 2018. Same Store NOI increased by $0.6 million, or 0.6%, to $102.0 million for the quarter ended June 30, 2019 from $101.4 million for the quarter ended June 30, 2018.

During the quarter ended June 30, 2019, the Company leased 696,497 square feet, of which the Company’s share was 497,300 square feet that was leased at a weighted average initial rent of $89.38 per square foot. This leasing activity, partially offset by lease expirations in the quarter, increased leased occupancy and same store leased occupancy (properties owned by the Company in both reporting periods) by 70 basis points to 96.7% at June 30, 2019, from 96.0% at March 31, 2019. Of the 696,497 square feet leased in the second quarter, 488,092 square feet represented second generation space (space that had been vacant for less than twelve months) for which the Company achieved a positive mark-to-market of 25.0% on a cash basis and 21.6% on a GAAP basis. The weighted average lease term for leases signed during the second quarter was 8.6 years and weighted average tenant improvements and leasing commissions on these leases were $10.85 per square foot per annum, or 12.1% of initial rent.

Six Months Ended June 30, 2019

Same Store Cash NOI increased by $16.1 million, or 9.8%, to $181.3 million for the six months ended June 30, 2019 from $165.2 million for the six months ended June 30, 2018. Same Store NOI increased by $7.2 million, or 3.6%, to $204.1 million for the six months ended June 30, 2019 from $196.9 million for the six months ended June 30, 2018.

During the six months ended June 30, 2019, the Company leased 1,049,759 square feet, of which the Company’s share was 745,188 square feet that was leased at a weighted average initial rent of $92.03 per square foot. This leasing activity, partially offset by lease expirations in the six months and the acquisition of 111 Sutter Street in February 2019, a 70.3% leased asset, increased leased occupancy by 30 basis points to 96.7% at June 30, 2019, from 96.4% at December 31, 2018. Same store leased occupancy (properties owned by the Company in both reporting periods), which excludes the impact of 111 Sutter Street, increased by 70 basis points to 97.1% at June 30, 2019 from 96.4% at December 31, 2018. Of the 1,049,759 square feet leased in the six months, 668,254 square feet represented second generation space (space that had been vacant for less than twelve months) for which the Company achieved a positive mark-to-market of 18.5% on a cash basis and 19.0% on a GAAP basis. The weighted average lease term for leases signed during the six months was 9.5 years and weighted average tenant improvements and leasing commissions on these leases were $10.56 per square foot per annum, or 11.5% of initial rent.

Guidance

The Company is updating its Estimated Core FFO Guidance for the full year of 2019, which is reconciled below to estimated net income attributable to common stockholders per diluted share in accordance with GAAP. The Company estimates that net income attributable to common stockholders will be between $0.03 and $0.07 per diluted share, compared to its prior estimate of net income attributable to common stockholders of $0.01 to $0.05 per diluted share, up $0.02 per diluted share from the midpoint of the Company’s prior estimate, resulting primarily from better than expected portfolio operations. The estimated net income attributable to common stockholders per diluted share is not a projection and is being provided solely to satisfy the disclosure requirements of the U.S. Securities and Exchange Commission.

Based on the Company’s performance for the six months ended June 30, 2019 and its outlook for the remainder of 2019, the Company is raising its Estimated 2019 Core FFO Guidance to be between $0.93 and $0.97 per diluted share, compared to its prior estimate of $0.90 to $0.94 per diluted share. This represents an increase of $0.03 per diluted share at the midpoint of the Company’s guidance resulting primarily from (i) $0.02 per diluted share from better than expected portfolio operations, and (ii) $0.01 per diluted share from the acquisition of a joint venture interest in 55 Second Street, which is expected to close at the end of the third quarter.

 

 

 

 

 

 

 

Full Year 2019

 

(Amounts per diluted share)

Low

 

 

High

 

Estimated net income attributable to common stockholders

$

0.03

 

 

$

0.07

 

Pro rata share of real estate depreciation and amortization, including

the Company's share of unconsolidated joint ventures

 

0.90

 

 

 

0.90

 

Estimated Core FFO

$

0.93

 

 

$

0.97

 

Except as described above, these estimates reflect management’s view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels and the earnings impact of the events referenced in this release and otherwise to be referenced during the conference call referred to on page 6. These estimates do not include the impact on operating results from possible future property acquisitions or dispositions, capital markets activity or realized and unrealized gains or losses on real estate fund investments. The estimates set forth above may be subject to fluctuations as a result of several factors, including straight-line rent adjustments and the amortization of above and below-market leases. There can be no assurance that the Company’s actual results will not differ materially from the estimates set forth above.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects” and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance or achievements. These factors include, without limitation, the ability to enter into new leases or renew leases on favorable terms, dependence on tenants’ financial condition, the uncertainties of real estate development, acquisition and disposition activity, the ability to effectively integrate acquisitions, the costs and availability of financing, the ability of our joint venture partners to satisfy their obligations, the effects of local, national and international economic and market conditions, the effects of acquisitions, dispositions and possible impairment charges on our operating results, regulatory changes, including changes to tax laws and regulations, and other risks and uncertainties detailed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission. The Company does not undertake a duty to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

FFO is a supplemental measure of our performance. We present FFO in accordance with the definition adopted by the National Association of Real Estate Investment Trusts (“Nareit”). Nareit defines FFO as net income or loss, calculated in accordance with GAAP, adjusted to exclude depreciation and amortization from real estate assets, impairment losses on certain real estate assets and gains or losses from the sale of certain real estate assets or from change in control of certain real estate assets, including our share of such adjustments of unconsolidated joint ventures. FFO is commonly used in the real estate industry to assist investors and analysts in comparing results of real estate companies because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. In addition, we present Core FFO as an alternative measure of our operating performance, which adjusts FFO for certain other items that we believe enhance the comparability of our FFO across periods. Core FFO, when applicable, excludes the impact of certain items, including, transaction related costs, realized and unrealized gains or losses on real estate fund investments, unrealized gains or losses on interest rate swaps, severance costs and gains or losses on early extinguishment of debt, in order to reflect the Core FFO of our real estate portfolio and operations. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.

FFO and Core FFO are presented as supplemental financial measures and do not fully represent our operating performance. Other REITs may use different methodologies for calculating FFO and Core FFO or use other definitions of FFO and Core FFO and, accordingly, our presentation of these measures may not be comparable to other real estate companies. Neither FFO nor Core FFO is intended to be a measure of cash flow or liquidity. Please refer to our financial statements, prepared in accordance with GAAP, for purposes of evaluating our financial condition, results of operations and cash flows.

NOI is used to measure the operating performance of our properties. NOI consists of rental revenue (which includes property rentals, tenant reimbursements and lease termination income) and certain other property-related revenue less operating expenses (which includes property-related expenses such as cleaning, security, repairs and maintenance, utilities, property administration and real estate taxes). We also present Cash NOI which deducts from NOI, straight-line rent adjustments and the amortization of above and below-market leases, including our share of such adjustments of unconsolidated joint ventures. In addition, we present PGRE's share of NOI and Cash NOI which represents our share of NOI and Cash NOI of consolidated and unconsolidated joint ventures, based on our percentage ownership in the underlying assets. We use NOI and Cash NOI internally as performance measures and believe they provide useful information to investors regarding our financial condition and results of operations because they reflect only those income and expense items that are incurred at property level.

Same Store NOI is used to measure the operating performance of properties that were owned by us in a similar manner during both the current period and prior reporting periods and represents Same Store NOI from consolidated and unconsolidated joint ventures based on our percentage ownership in the underlying assets. Same Store NOI also excludes lease termination income, impairment of receivables arising from operating leases and certain other items that may vary from period to period. We also present Same Store Cash NOI, which excludes the effect of non-cash items such as the straight-line rent adjustments and the amortization of above and below-market leases.

A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure can be found in this press release and in our Supplemental Information for the quarter ended June 30, 2019, which is available on our website.

Investor Conference Call and Webcast

The Company will host a conference call and audio webcast on Thursday, August 1, 2019 at 10:00 a.m. Eastern Time (ET), during which management will discuss the second quarter results and provide commentary on business performance. A question and answer session with analysts and investors will follow the prepared remarks.

The conference call can be accessed by dialing 877-407-0789 (domestic) or 201-689-8562 (international). An audio replay of the conference call will be available from 1:00 p.m. ET on August 1, 2019 through August 8, 2019 and can be accessed by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the passcode 13692461.

A live audio webcast of the conference call will be available through the “Investors” section of the Company’s website, www.paramount-group.com. A replay of the webcast will be archived on the Company’s website.

About Paramount Group, Inc.

Headquartered in New York City, Paramount Group, Inc. is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York City, San Francisco, and Washington, D.C. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.

 

Paramount Group, Inc.
Consolidated Balance Sheets
(Unaudited and in thousands)

 

Assets:

 

June 30, 2019

 

 

December 31, 2018

 

Real estate, at cost

 

 

 

 

 

 

 

 

Land

 

$

2,065,206

 

 

$

2,065,206

 

Buildings and improvements

 

 

6,084,684

 

 

 

6,036,445

 

 

 

 

8,149,890

 

 

 

8,101,651

 

Accumulated depreciation and amortization

 

 

(735,124

)

 

 

(644,639

)

Real estate, net

 

 

7,414,766

 

 

 

7,457,012

 

Cash and cash equivalents

 

 

283,485

 

 

 

339,653

 

Restricted cash

 

 

22,894

 

 

 

25,756

 

Investments in unconsolidated joint ventures

 

 

137,734

 

 

 

78,863

 

Investments in unconsolidated real estate funds

 

 

8,263

 

 

 

10,352

 

Preferred equity investments

 

 

-

 

 

 

36,042

 

Accounts and other receivables, net

 

 

19,695

 

 

 

20,076

 

Due from affiliates

 

 

170,000

 

 

 

-

 

Deferred rent receivable

 

 

289,565

 

 

 

267,456

 

Deferred charges, net

 

 

130,550

 

 

 

117,858

 

Intangible assets, net

 

 

239,326

 

 

 

270,445

 

Other assets

 

 

137,597

 

 

 

132,465

 

Total assets

 

$

8,853,875

 

 

$

8,755,978

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Notes and mortgages payable, net

 

$

3,571,233

 

 

$

3,566,917

 

Revolving credit facility

 

 

170,000

 

 

 

-

 

Accounts payable and accrued expenses

 

 

124,460

 

 

 

124,334

 

Dividends and distributions payable

 

 

25,953

 

 

 

25,902

 

Intangible liabilities, net

 

 

84,531

 

 

 

95,991

 

Other liabilities

 

 

64,309

 

 

 

51,170

 

Total liabilities

 

 

4,040,486

 

 

 

3,864,314

 

Equity:

 

 

 

 

 

 

 

 

Paramount Group, Inc. equity

 

 

3,950,070

 

 

 

4,000,800

 

Noncontrolling interests in:

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

365,278

 

 

 

394,995

 

Consolidated real estate fund

 

 

81,949

 

 

 

66,887

 

Operating Partnership

 

 

416,092

 

 

 

428,982

 

Total equity

 

 

4,813,389

 

 

 

4,891,664

 

Total liabilities and equity

 

$

8,853,875

 

 

$

8,755,978

 

 

 

Paramount Group, Inc.
Consolidated Statements of Income
(Unaudited and in thousands, except share and per share amounts)

 

 

 

 

 

 

 

For the Three Months Ended

 

 

For the Six Months Ended

 

 

 

 

 

 

 

June 30,

 

 

June 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental revenue

 

 

181,140

 

 

 

182,722

 

 

 

363,756

 

 

 

360,401

 

Fee and other income

 

 

7,443

 

 

 

8,697

 

 

 

16,619

 

 

 

15,289

 

Total revenues

 

 

188,583

 

 

 

191,419

 

 

 

380,375

 

 

 

375,690

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating

 

 

67,572

 

 

 

67,646

 

 

 

135,953

 

 

 

136,624

 

Depreciation and amortization

 

 

62,625

 

 

 

64,775

 

 

 

125,714

 

 

 

129,931

 

General and administrative

 

 

17,695

 

 

 

17,195

 

 

 

35,138

 

 

 

29,826

 

Transaction related costs

 

 

182

 

 

 

293

 

 

 

918

 

 

 

413

 

Total expenses

 

 

148,074

 

 

 

149,909

 

 

 

297,723

 

 

 

296,794

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income from unconsolidated joint ventures

 

 

(456

)

 

 

2,521

 

 

 

(1,483

)

 

 

2,459

 

Income (loss) from unconsolidated real estate funds

 

 

19

 

 

 

(14

)

 

 

65

 

 

 

(80

)

Interest and other income, net

 

 

2,583

 

 

 

2,094

 

 

 

6,483

 

 

 

4,110

 

Interest and debt expense

 

 

(37,213

)

 

 

(36,809

)

 

 

(74,137

)

 

 

(72,891

)

Real estate impairment loss

 

 

-

 

 

 

(46,000

)

 

 

-

 

 

 

(46,000

)

Net income (loss) before income taxes

 

 

5,442

 

 

 

(36,698

)

 

 

13,580

 

 

 

(33,506

)

Income tax (expense) benefit

 

 

(268

)

 

 

120

 

 

 

(1,406

)

 

 

(357

)

Net income (loss)

 

 

5,174

 

 

 

(36,578

)

 

 

12,174

 

 

 

(33,863

)

Less net (income) loss attributable to noncontrolling

   interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

(2,408

)

 

 

(1,752

)

 

 

(5,202

)

 

 

(2,807

)

Consolidated real estate fund

 

 

(53

)

 

 

(152

)

 

 

(147

)

 

 

(582

)

Operating Partnership

 

 

(258

)

 

 

3,666

 

 

 

(661

)

 

 

3,550

 

Net income (loss) attributable to common stockholders

 

$

2,455

 

 

$

(34,816

)

 

$

6,164

 

 

$

(33,702

)

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.01

 

 

$

(0.14

)

 

$

0.03

 

 

$

(0.14

)

Diluted

 

$

0.01

 

 

$

(0.14

)

 

$

0.03

 

 

$

(0.14

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

234,329,904

 

 

 

240,336,485

 

 

 

233,877,117

 

 

 

240,324,183

 

Diluted

 

 

234,355,864

 

 

 

240,336,485

 

 

 

233,908,236

 

 

 

240,324,183

 

 

 

Paramount Group, Inc.
Reconciliation of Net Income (Loss) to FFO and Core FFO
(Unaudited and in thousands, except share and per share amounts)

 

 

 

 

 

 

For the Three Months Ended

 

 

For the Six Months Ended

 

 

 

 

 

 

June 30,

 

 

June 30,

 

 

 

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Reconciliation of Net Income (Loss) to FFO and Core FFO:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

5,174

 

 

$

(36,578

)

 

$

12,174

 

 

$

(33,863

)

 

Real estate depreciation and amortization (including our

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

share of unconsolidated joint ventures)

 

 

66,069

 

 

 

66,711

 

 

 

132,134

 

 

 

133,871

 

 

Real estate impairment loss

 

 

-

 

 

 

46,000

 

 

 

-

 

 

 

46,000

 

 

FFO

 

 

71,243

 

 

 

76,133

 

 

 

144,308

 

 

 

146,008

 

 

Less FFO attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

(11,277

)

 

 

(10,840

)

 

 

(23,025

)

 

 

(21,047

)

 

Consolidated real estate fund

 

 

(53

)

 

 

(152

)

 

 

(147

)

 

 

(582

)

 

FFO attributable to Paramount Group Operating Partnership

 

 

59,913

 

 

 

65,141

 

 

 

121,136

 

 

 

124,379

 

 

Less FFO attributable to noncontrolling interests in

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in Operating Partnership

 

 

(5,705

)

 

 

(6,206

)

 

 

(11,703

)

 

 

(11,791

)

 

FFO attributable to common stockholders

 

$

54,208

 

 

$

58,935

 

 

$

109,433

 

 

$

112,588

 

 

Per diluted share

 

$

0.23

 

 

$

0.25

 

 

$

0.47

 

 

$

0.47

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO

 

$

71,243

 

 

$

76,133

 

 

$

144,308

 

 

$

146,008

 

 

Non-core items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Our share of distributions from 712 Fifth Avenue in

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

excess of earnings

 

 

(1,331

)

 

 

(1,512

)

 

 

(61

)

 

 

(317

)

 

Other, net

 

 

260

 

 

 

367

 

 

 

1,083

 

 

 

618

 

 

Core FFO

 

 

70,172

 

 

 

74,988

 

 

 

145,330

 

 

 

146,309

 

 

Less Core FFO attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

(11,277

)

 

 

(10,840

)

 

 

(23,025

)

 

 

(21,047

)

 

Consolidated real estate fund

 

 

(53

)

 

 

(152

)

 

 

(147

)

 

 

(582

)

 

Core FFO attributable to Paramount Group

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Partnership

 

 

58,842

 

 

 

63,996

 

 

 

122,158

 

 

 

124,680

 

 

Less Core FFO attributable to noncontrolling interests

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in Operating Partnership

 

 

(5,603

)

 

 

(6,097

)

 

 

(11,806

)

 

 

(11,818

)

 

Core FFO attributable to common stockholders

 

$

53,239

 

 

$

57,899

 

 

$

110,352

 

 

$

112,862

 

 

Per diluted share

 

$

0.23

 

 

$

0.24

 

 

$

0.47

 

 

$

0.47

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

234,329,904

 

 

 

240,336,485

 

 

 

233,877,117

 

 

 

240,324,183

 

 

Effect of dilutive securities

 

 

25,960

 

 

 

17,229

 

 

 

31,119

 

 

 

20,525

 

Denominator for FFO and Core FFO per diluted share

234,355,864

 

240,353,714

233,908,236

 

240,344,708

 

 

Paramount Group, Inc.
Reconciliation of Net Income (Loss)
to Same Store NOI and Same Store Cash NOI
(Unaudited and in thousands)

 

 

 

 

 

For the Three Months Ended

 

 

For the Six Months Ended

 

 

 

 

 

June 30,

 

 

June 30,

 

 

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Reconciliation of Net Income (Loss) to Same Store NOI
and Same Store Cash NOI:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

5,174

 

 

$

(36,578

)

 

$

12,174

 

 

$

(33,863

)

Add (subtract) adjustments to arrive at NOI and Cash NOI:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

62,625

 

 

 

64,775

 

 

 

125,714

 

 

 

129,931

 

General and administrative

 

17,695

 

 

 

17,195

 

 

 

35,138

 

 

 

29,826

 

Interest and debt expense

 

37,213

 

 

 

36,809

 

 

 

74,137

 

 

 

72,891

 

Income tax (benefit) expense

 

268

 

 

 

(120

)

 

 

1,406

 

 

 

357

 

NOI from unconsolidated joint ventures

 

4,185

 

 

 

4,569

 

 

 

9,596

 

 

 

9,309

 

Fee income

 

(4,213

)

 

 

(5,409

)

 

 

(10,212

)

 

 

(8,874

)

Interest and other income, net

 

(2,583

)

 

 

(2,094

)

 

 

(6,483

)

 

 

(4,110

)

Real estate impairment loss

 

-

 

 

 

46,000

 

 

 

-

 

 

 

46,000

 

Other, net

 

619

 

 

 

(2,214

)

 

 

2,336

 

 

 

(1,966

)

NOI

 

120,983

 

 

 

122,933

 

 

 

243,806

 

 

 

239,501

 

Less NOI attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

(17,839

)

 

 

(16,674

)

 

 

(35,748

)

 

 

(32,688

)

Consolidated real estate fund

 

(6

)

 

 

(13

)

 

 

23

 

 

 

13

 

PGRE's share of NOI

 

103,138

 

 

 

106,246

 

 

 

208,081

 

 

 

206,826

 

Acquisitions

 

(1,213

)

 

 

-

 

 

 

(1,913

)

 

 

-

 

Dispositions

 

-

 

 

 

(4,925

)

 

 

-

 

 

 

(9,824

)

Lease termination income (including our share

of unconsolidated joint ventures)

 

-

 

 

 

(54

)

 

 

(2,346

)

 

 

(244

)

Other, net

 

91

 

 

 

174

 

 

 

276

 

 

 

174

 

PGRE's share of Same Store NOI

$

102,016

 

 

$

101,441

 

 

$

204,098

 

 

$

196,932

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

$

120,983

 

 

$

122,933

 

 

$

243,806

 

 

$

239,501

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Straight-line rent adjustments (including our share

of unconsolidated joint ventures)

 

(10,857

)

 

 

(16,853

)

 

 

(22,635

)

 

 

(30,050

)

Amortization of above and below-market leases, net

(including our share of unconsolidated joint ventures)

 

(2,725

)

 

 

(4,141

)

 

 

(5,945

)

 

 

(8,398

)

Cash NOI

 

107,401

 

 

 

101,939

 

 

 

215,226

 

 

 

201,053

 

Less Cash NOI attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

(15,583

)

 

 

(13,438

)

 

 

(30,368

)

 

 

(26,631

)

Consolidated real estate fund

 

(6

)

 

 

(13

)

 

 

23

 

 

 

13

 

PGRE's share of Cash NOI

 

91,812

 

 

 

88,488

 

 

 

184,881

 

 

 

174,435

 

Acquisitions

 

(951

)

 

 

-

 

 

 

(1,511

)

 

 

-

 

Dispositions

 

-

 

 

 

(4,613

)

 

 

-

 

 

 

(9,205

)

Lease termination income (including our share of

unconsolidated joint ventures)

 

-

 

 

 

(54

)

 

 

(2,346

)

 

 

(244

)

Other, net

 

91

 

 

 

174

 

 

 

276

 

 

 

174

 

PGRE's share of Same Store Cash NOI

$

90,952

 

 

$

83,995

 

 

$

181,300

 

 

$

165,160

 

 

Contacts

Wilbur Paes
Executive Vice President, Chief Financial Officer
212-237-3122
ir@paramount-group.com

Robert Simone
Director, Business Development & Investor Relations
212-237-3138
ir@paramount-group.com

Media:
212-492-2285
pr@paramount-group.com

Contacts

Wilbur Paes
Executive Vice President, Chief Financial Officer
212-237-3122
ir@paramount-group.com

Robert Simone
Director, Business Development & Investor Relations
212-237-3138
ir@paramount-group.com

Media:
212-492-2285
pr@paramount-group.com