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SEC Filings

PREM14A
FOREST CITY REALTY TRUST, INC. filed this Form PREM14A on 09/21/2018
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center REIT industries and its professional judgment, to be relevant for purposes of this analysis, considered such companies’ operations, lines of business, markets, sizes and geographies, and applied such multiples to the applicable estimated operating metric for the Company as set forth in the final business case projections.

The selected group of companies Lazard reviewed in each of office, multifamily, mall and shopping center REIT industries, referred to as the “select comparable companies,” were as follows:

 

Office

  

Multifamily

  

Mall

  

Shopping Center

Alexandria Real Estate

Equities, Inc.

  

AvalonBay

Communities, Inc.

   CBL & Associates Properties, Inc.    Acadia Realty Trust

Boston Properties, Inc.

   Camden Property Trust    GGP Inc.    Federal Realty
Investment Trust

SL Green Realty Corp.

   Equity Residential    The Macerich Company   
   UDR, Inc.    Simon Property Group, Inc.   
      Taubman Centers, Inc.   

Lazard selected the companies reviewed in this analysis because, among other things, the select comparable companies operate businesses similar to the businesses of the Company segments. However, no selected company is identical to the Company or any of the Company segments and certain of these companies may have characteristics that are materially different from those of the Company and the Company segments. Accordingly, Lazard believes that purely quantitative analyses are not, in isolation, determinative in the context of the merger and that qualitative judgments concerning differences between the businesses, financial and operating characteristics and prospects of the Company, each Company segment and the select comparable companies are also relevant.

For each of the select comparable companies, Lazard calculated and compared the ratio of such company’s closing trading price, as of July 27, 2018, to each company’s funds from operations, or “FFO,” for the next 12-month period, or the “NTM period,” and calculated and compared the ratio of such company’s closing trading price, as of July 27, 2018, to each company’s adjusted FFO (adjusted for recurring capital expenditures and select non-cash and other adjustments), or “AFFO,” for the NTM period.

Lazard then observed the median of these ratios for the select comparable companies in each of the office, multifamily, mall and shopping center REIT industries, and calculated the weighted average of these observed medians based on the proportional contribution of each Company segment to the Company’s estimated NOI for 2018, as set forth in the final business case projections. The NTM period FFO and AFFO estimates for the select comparable companies used by Lazard in its analysis were based on publicly available Wall Street equity research estimates. The following table summarizes the results of this review for the select comparable companies and the proportional contribution of the relevant Company segment to NOI for 2018:

 

     Median NTM
Trading
Price / FFO
     Median NTM
Trading
Price / AFFO
     Proportional
Contribution
of Company
Segment to NOI
 
   2018E  

Office

     18.1x        22.1x        50

Multifamily

     18.7x        21.0x        33

Mall

     13.8x        16.8x        13

Shopping Center

     18.7x        23.5x        4

Weighted Average

     17.7x        21.1x     

Lazard then selected and applied a range of FFO multiples of 12.7x to 16.7x, as appropriate to the Company’s estimated operating funds from operations, or “OFFO,” for the NTM period, as set forth in the final business case

 

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