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SEC Filings

8-K
FOREST CITY REALTY TRUST, INC. filed this Form 8-K on 10/30/2018
Entire Document
 
Forest City Realty Trust, Inc. and Subsidiaries
Earnings Release


Comparable NOI, Occupancies and Rent
Operating results for the company’s real estate portfolio for the three and nine months ended September 30, 2018, are summarized below.
 
Percent Change to Prior Year
 
Three Months Ended September 30, 2018
Nine Months Ended September 30, 2018
Comparable NOI (Non-GAAP)
 
 
Office
2.1
%
1.4
%
Apartments
1.1
%
2.3
%
Total
1.7
%
1.8
%
 
As of September 30,
 
2018
2017
Comparable occupancy, Office
94.5
%
97.0
%
 
Nine Months Ended September 30, 2018
Nine Months Ended September 30, 2017
Comparable economic occupancy, Apartments
94.7
%
94.1
%
Comparable average rental rates, Apartments
$
1,553

$
1,533

Comparable average Core Market rental rates, Apartments
$
2,031

$
2,011


Projects Under Construction
At September 30, 2018, Forest City had seven projects under construction at a total cost of $880.3 million, or $279.8 million at the company’s share, for a development ratio of 4.4 percent. Additional information on openings and projects under construction can be found in the Development Pipeline exhibit in the company’s Supplemental Package for the quarter ended September 30, 2018.

Commentary
“Results for the quarter and year to date met our expectations and demonstrate the strength of our operating properties and core markets, as well as the skill and dedication of our teams across the enterprise. They also reflect the ongoing execution of our strategies to further strengthen and focus our company,” said David J. LaRue, Forest City president and chief executive officer.
   
“Results in apartments benefited from increased occupancy, partially offset by increased real estate taxes, utility expenses, wages and concessions. As expected, comp NOI growth for the apartment portfolio moderated, up 1.1 percent in the third quarter and 2.3 percent for the first nine months of 2018.

“In office, comp NOI grew by 2.1 percent in the third quarter, driven primarily by strong results from University Park at MIT in Cambridge, partially offset by a large lease expiration at One Pierrepont Plaza in Brooklyn. We expect to have roughly half the Pierrepont space under lease by yearend, with letters of intent for additional space beyond that.

“At the end of the third quarter, our Adjusted EBITDA margins (excluding the Development Segment) were up 490 basis points over our 2016 yearend benchmark, near the top of our target range of 400-to-500 basis points of improvement by mid-2018. We ended the third quarter with a ratio of Net Debt to Adjusted EBITDA of 6.7 times, on a rolling 12-month basis, down from 7.8 times at September 30, 2017, and down from 7.4 times at the end of 2017.

“Projects under construction continue on track in our core markets, including greater Greater Washington D.C., New York City, and Denver, and development work is progressing on our future entitled opportunities, including both the Pier 70 and 5M projects in San Francisco.”

Merger Agreement
On July 30, 2018, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Antlia Holdings LLC (“Parent”) and Antlia Merger Sub Inc. (“Merger Sub”), pursuant to which, upon the terms and subject to the conditions set forth therein, Merger Sub will merge with and into Forest City (the “Merger”), with Forest City surviving

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