JACKSON, Miss., May 2, 2011 /PRNewswire/ --
Highlights
Reports FFO and repeated FFO of $0.59 per share
Reports median occupancy of 84.7%, with portfolio 85.2% leased
Announced consent with Eola for administration firm grant
Purchased or beneath stipulate to buy a complete of 7 properties for Fund II
Parkway Properties, Inc. (NYSE:PKY) currently voiced results for its initial entertain finished Mar 31, 2011.
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Steven G. Rogers, President and Chief Executive Officer stated, "Parkway finished the initial entertain with repeated FFO, FAD, and occupancy all somewhat improved than our expectations. Most importantly, Parkway voiced before long after quarter-end an consent to mix with Eola, that consists of the grant of Eola's administration firm to Parkway and the buy of 6 office properties on interest of Fund II. This multiple represents a poignant increase in speed of Parkway's FOCUS Plan and a tangible trail for future expansion in the Company."
Consolidated Financial Results
Funds from operations ("FFO") existing to familiar shareholders totaled $12.6 million, or $0.59 per widely separated share, is to 3 months finished Mar 31, 2011, as compared to $19.8 million, or $0.92 per widely separated share, is to 3 months finished Mar 31, 2010. Recurring FFO totaled $12.8 million, or $0.59 per widely separated share is to 3 months finished Mar 31, 2011, as compared to $14.6 million, or $0.68 per widely separated share is to 3 months finished Mar 31, 2010.
Included in FFO per widely separated share are the subsequent to amounts (in thousands, solely median lease per block feet and median occupancy):
Funds existing for placement ("FAD") totaled $5.4 million, or $0.25 per widely separated share, is to 3 months finished Mar 31, 2011, as compared to $14.1 million, or $0.65 per widely separated share, is to 3 months finished Mar 31, 2010.
Net loss attributable to familiar shareholders is to 3 months finished Mar 31, 2011, was $6.8 million, or $0.32 per widely separated share, as compared to net income attributable to familiar shareholders of $1.3 million or $0.06 per widely separated share, is to 3 months finished Mar 31, 2010.
Asset Recycling
On January 21, 2011, the Company and Parkway Properties Office Fund II, LP ("Fund II") acquired the office and sell part of 3344 Peachtree located in the Buckhead submarket of Atlanta for $167.3 million. 3344 Peachtree contains roughly 484,000 block feet of office and sell space and includes an adjoining eleven-story parking structure. Fund II's investment in the skill totaled $160.0 million, with Parkway appropriation the outstanding $7.3 million. Due to Parkway's extra investment, the Company's efficient tenure in the skill is 33.0%. An extra $2.6 million is approaching to be outlayed for shutting costs, office building improvements, leasing expenses and reside improvements during the initial two years of ownership. Simultaneous with closing, Fund II insincere the $89.6 million existing non-recourse initial mortgage, that matures on October 1, 2017, and carries a prearranged interest rate of 4.8%. In accommodations with GAAP, the housing loan was recorded at $87.2 million to simulate the worth of the instrument formed on a marketplace interest rate of 5.25% on the date of purchase. Parkway's equity grant in the investment is $25.5 million and was primarily saved by accessibility beneath the Company's credit facility.
On February 4, 2011, the Company purchased its partner's 50% interest in the Wink-Parkway Partnership for $250,000. The partnership was determined is to role of owning the Wink Building, a 32,000 block feet office skill in New Orleans, Louisiana. Following the buy of its partner's interest, Parkway's tenure interest in the Wink Building is 100%.
On Mar 31, 2011, Fund II acquired 245 Riverside located in the middle business neighborhood of Jacksonville, Florida for $18.5 million. 245 Riverside contains roughly 135,000 block feet of office space. An extra $1.6 million is approaching to be outlayed for shutting costs, office building improvements, leasing expenses and reside improvements during the initial two years of ownership. In connection with the purchase, Fund II placed a $9.3 million non-recourse initial housing loan with a prearranged interest rate of 5.3%, an initial thirty-six month interest usually period, and a manhood date of Mar 31, 2019. Parkway's equity grant of $2.8 million was primarily saved by accessibility beneath the Company's credit facility.
On April 8, 2011, Fund II acquired Corporate Center Four at International Plaza located in the Westshore submarket of Tampa, Florida for $45.0 million. Corporate Center Four contains roughly 250,000 block feet of office space. An extra $5.6 million is approaching to be outlayed for shutting costs, office building improvements, leasing expenses and reside improvements during the initial two years of ownership. In connection with the purchase, Fund II placed a $22.5 million non-recourse initial housing loan with a prearranged interest rate of 5.4%, an initial thirty-six month interest usually period, and a manhood date of April 8, 2019. Parkway's equity grant of $6.8 million was primarily saved by accessibility beneath the Company's credit facility.
In connection with the Company's consent with Eola Capital ("Eola"), Fund II is beneath stipulate to buy 4 extra office properties for $316.5 million. The 4 properties are located in Philadelphia, Atlanta, Orlando, and Tampa, and enclose roughly 2.1 million block feet of office space. An extra $20.9 million is approaching to be outlayed for shutting costs, office building improvements, leasing expenses and reside improvements during the initial two years of ownership. Closing on the buy of these outstanding 4 properties is approaching to happen in the second entertain of 2011. An existing institutional financier in Two Liberty Place, located in the middle business neighborhood of Philadelphia, will sustain an 11% tenure in the property. Parkway's pro rata share of Two Liberty Place will be 19%, and Parkway's associate in Fund II will own the outstanding 70% interest. Fund II will pick up 100% of the outstanding 3 assets, with Parkway's tenure at 30%.
A complete list of the properties being purchased in connection with the consent with Eola is supposing below. Parkway's press let go released on April 11, 2011, provides extra data and discusses appropriation sources connected to the buy of these office properties by Fund II. Upon finishing of the buy of the listed properties, the complete amount invested by Fund II will be roughly $559.0 million, or 75% of the Fund's investment capacity.
On April 10, 2011, Parkway reached a decisive consent with Eola in that Eola would minister its Property Management Company (the "Management Company") to Parkway. Eola's principals will minister the Management Company to Parkway for initial care of $32.4 million in money and Eola's principals will have the chance to consequence (i) up to 1.574 million units of paltry partnership interest in Parkway's working partnership ("OP Units") by an earn-out understanding and (ii) up to 226,000 extra OP Units by an earn-up arrangement. To the border earned, all OP Units will be redeemable for shares of Parkway familiar batch on a one-for-one basis. Earn-out and earn-up care will be fortuitous on the success by the Management Company of targeted annual sum price income and/or share price levels during an initial time is to change of 2011 after shutting and a second time is to full monthly calendar year 2012. Parkway will moreover have protections against price income loss in the form of a ability requiring definite payments to Parkway in the eventuality of certain terminations of existing administration contracts and a non-compete consent with courtesy to the existing administration contracts of the Management Company. The Management Company currently manages properties totaling roughly 11.2 million block feet and constructed annual sum price revenue, inclusive skill management, leasing, construction administration together with organizational fees and reimbursements totaling roughly $21 million during 2010. The shutting is approaching to happen in the second entertain of 2011. Parkway's press let go released on April 11, 2011, provides extra data and discusses appropriation sources connected to the grant of the Management Company.
Operations and Leasing
The Company's median lease per block feet decreased 0.3% to $22.94 during the initial entertain 2011 as compared to the initial entertain 2010. On a same-store basis, the Company's median lease per block feet decreased 1.4% to $22.70 during the initial entertain 2011 as compared to $23.02 during the initial entertain 2010.
The Company's median occupancy is to initial entertain 2011 was 84.7% as compared to 86.2% is to initial entertain 2010. On a same-store basis, the Company's median occupancy is to initial entertain 2011 was 84.5% as compared to 86.1% is to initial entertain 2010.
At April 1, 2011, the Company's office portfolio occupancy was 83.8% as compared to 85.3% at January 1, 2011, and 85.6% at April 1, 2010. Not enclosed in the April 1, 2011, occupancy rate are the merger of Corporate Center Four at International Plaza office skill on April 8, 2011, together with 30 sealed leases totaling 257,000 block feet, approaching to take occupancy between right away and the second entertain of 2012. Including these leases and the buy of Corporate Center Four at International Plaza, the Company's portfolio was 85.2% leased at April 13, 2011.
Parkway's patron influence rate was 48.1% is to entertain finished Mar 31, 2011, as compared to 68.3% is to entertain finished December 31, 2010, and 57.2% is to entertain finished Mar 31, 2010. The lessen in the patron influence rate is to entertain finished Mar 31, 2011, was primarily attributable to the expiry of the 193,000 block feet AutoTrader.com lease at Peachtree Dunwoody Pavilion in Atlanta, Georgia.
During the initial entertain 2011, 58 leases were renewed totaling 388,000 rentable block feet at an median lease per block feet of $18.49, representing a 5.4% rate decrease, and at an median cost of $2.04 per block feet per year of the lease term.
During the initial entertain 2011, 13 expansion leases were sealed totaling 51,000 rentable block feet at an median lease per block feet of $22.34 and at an median cost of $3.85 per block feet per year of the lease term.
During the initial entertain 2011, 36 new leases were sealed totaling 161,000 rentable block feet at an median lease per block feet of $18.55 and at an median cost of $5.15 per block feet per year of the term.
For the initial entertain 2011, the Company's share of reported same-store net working income ("NOI") as compared to the same time of the previous year decreased $5.0 million or 15.0% on a GAAP basement and decreased $5.6 million or 17.5% on a money basis. The lessen is primarily due to a considerable lease close price received during the initial entertain of 2010. Also, is to initial entertain of 2011, Parkway's share of repeated same-store NOI compared to the same time of the previous year decreased $600,000 or 2.2% on a GAAP basement and decreased $1.2 million or 4.6% on a money basis. The lessen in same-store repeated NOI is primarily attributable to a lessen in rental income associated with a 1.6% shrinking in same-store median occupancy is to entertain finished Mar 31, 2011, as compared to the same time of the previous year.
Capital Structure
As of Mar 31, 2011, the Company had an outstanding change of $166.6 million beneath its credit trickery and hold $74.2 million in money and money equivalents of that $25.9 million of money and money equivalents was Parkway's share.
On January 31, 2011, the Company closed a new $190.0 million unsecured revolving credit trickery and a new $10.0 million unsecured working funds revolving credit facility. The new credit services transposed the existing unsecured revolving credit facility, term loan and working funds trickery that were scheduled to developed on April 27, 2011. The stream interest rate on the credit services is LIBOR in addition to 325 basement points or roughly 3.5%. Wells Fargo Securities and JP Morgan Securities LLC acted as Joint Lead Arrangers and Joint Book Runners on the unsecured revolving credit facility. In addition, Wells Fargo Bank, N.A. acted as Administration Agent and JPMorgan Chase Bank, N.A. acted as Syndication Agent. Other participating lenders add PNC Bank, N.A., Bank of America, N.A., US Bank, N.A., Trustmark National Bank, and BancorpSouth Bank. The working funds revolving credit trickery was supposing solely by PNC Bank, N.A.
On February 18, 2011, Fund II performed a $10.0 million housing loan loan feel safe by Carmel Crossing, a 326,000 block feet office intricate in Charlotte, North Carolina. The housing loan loan has a prearranged rate of 5.5% and is interest usually by its manhood in 9 years. Parkway received $2.4 million in net deduction from the loan, representing its 30% tenure interest in the property. The deduction were used to lower amounts outstanding beneath the Company's credit facility.
The Company's formerly voiced money division of $0.075 per share is to entertain finished Mar 31, 2011, represented a payout of roughly 12.8% of FFO per widely separated share is to quarter. The initial entertain division was paid Mar 30, 2011. The division was the ninety-eighth (98(th)) uninterrupted quarterly placement to Parkway's shareholders of Common Stock, representing an annualized division of $0.30 per share.
At Mar 31, 2011, the Company's net debt to EBITDA multiple was 6.6x, after adjusting EBITDA is to annualized effect of new investments in office properties during the initial entertain of 2011, as compared to 5.9x at December 31, 2010, and 6.1x at Mar 31, 2010.
In connection with the Fund II investments still beneath contract, Parkway has received a undertaking from an institutional financier to deposit coexisting with closing, roughly $26.0 million in the Company's existing Series D elite stock. Additionally, Parkway has performed a undertaking for overpass financing of up to $50.0 million in the form of elite stock, that will be existing to account the shutting of the Eola Management Company combination, if needed.
2011 Outlook
Until there is more faith around the timing of the shutting of the multiple with Eola and connected funds wake up as formerly described in Parkway's press let go released on April 11, 2011, the Company is not reworking its original 2011 reported FFO standpoint of $2.35 to $2.50 and gain (loss) per widely separated share "EPS") of ($0.85) to ($0.70). The settlement of projected EPS to projected FFO per widely separated share is as follows:
The original 2011 standpoint is formed on the core operating, financing and funds assumptions supposing by the Company on February 7, 2011.
About Parkway Properties
Parkway Properties, Inc., a member of the SP Small Cap 600 Index, is a self-administered actual estate investment certitude specializing in the operation, leasing, acquisition, and tenure of office properties. The Company is geographically focused on the Southeastern and Southwestern United States and Chicago. Parkway owns or has an interest in 67 office properties located in 11 states with an aggregate of roughly 14.1 million block feet of leasable space at May 2, 2011. Included in the portfolio are 22 properties totaling 4.5 million block feet that are owned mutually with other investors, representing 32.2% of the portfolio. Fee-based actual estate services are offering by the Company's wholly-owned subsidiary, Parkway Realty Services, that moreover manages and/or leases roughly 1.6 million block feet for third-party owners at May 2, 2011.
Additional Information
The Company will actions a discussion call to confer the results of its initial entertain operations on Tuesday, May 3, 2011, at 11:00 a.m. Eastern Time. To experience in the discussion call, greatfully dial 800-857-4978 and use the written pass ethics "PARKWAY". A live audio webcast will moreover be existing by selecting the "1Q Call" symbol on the Company's website at www.pky.com . An audio replay of the call may be accessed 24 hours a day by May 16, 2011, by dialing 866-373-4990 and using the pass ethics of 9285. An audio replay will be archived and indexed in the Corporate section of the Company's website at www.pky.com . A duplicate of the Company's 2011 initial entertain Supplemental Financial Property Information inform is existing by accessing the Company's website, emailing your solicit to rjordan@pky.com , or mission Rita Jordan at 601-948-4091. Please experience in the visible part of the discussion call by accessing the Company's website and downloading the "1Q11 Company Presentation."
Additional data on Parkway Properties, Inc., inclusive an repository of corporate press releases and discussion calls, is existing on the Company's website. The Company's initial entertain 2011 Supplemental Financial Property Information report, that includes a settlement of all non-GAAP financial measures to their directly similar GAAP financial measures, is existing on the Company's website.
Annual Meeting
Parkway Properties, Inc. will horde its 2011 Annual Meeting of Shareholders on May 12, 2011, at 3:00 p.m. Eastern Time. The meeting will be hold at the Buckhead Club located on 26th floor of 3344 Peachtree in Atlanta, Georgia.
Forward Looking Statement
Certain statements in this let go that are not in the present or past moving or confer the Company's expectations (including the use of the difference anticipate, believe, forecast, intends, expects, project, or similar expressions) are forward-looking statements inside of the meaning of the sovereign bonds laws and as such are formed on the Company's stream idea as to the result and timing of future events. Examples of forward-looking statements add projected net working income, hat rates, inner rates of return, forecasts of FFO accretion, projected funds improvements, approaching sources of financing, expectations as to the timing of acquisitions or dispositions, and descriptions relating to these expectations. There may be no self-confidence that future developments inspiring the Company will be those anticipated by the Company. These forward-looking statements engage risks and uncertainties (some of that are over the manage of the Company) and are theme to change formed on assorted factors, inclusive but not paltry to the subsequent to risks and uncertainties: changes in the actual estate attention and in opening of the financial markets; the urge for and marketplace acceptance of the Company's properties for rental purposes; the amount and expansion of the Company's expenses; reside financial difficulties and broad mercantile conditions, inclusive interest rates, together with mercantile conditions in those areas where the Company owns properties; risks associated with J.V. partners; the risks associated with the tenure and development of actual property; the disaster to pick up or sell properties as and when anticipated; close of skill administration contracts, the bankruptcy or penury of companies for that Eola or Parkway supply skill administration services; the ability of Parkway to confederate the business of Eola and not anticipated expenses in connection with such integration; the result of claims and lawsuit involving or inspiring the Company; and other risks and uncertainties minute from time to time in the Company's SEC filings. Should a or more of these risks or uncertainties occur, or should underlying assumptions infer incorrect, the Company's business, financial condition, liquidity, money flows and results could deviate materially from those expressed in the forward-looking statements. Any deliver seeking statements verbalise usually as of the date on that it is made. New risks and uncertainties movement over time, and it is not probable for us to envision the incident of these counts or the behaviour in that they may start us. The Company does not commence to refurbish forward-looking statements solely as may be compulsory by law.
Company's Use of Non-GAAP Financial Measures
FFO, FAD, NOI and EBITDA, inclusive connected per share amounts, are used by management, investors and attention analysts as supplemental measures of working opening of equity REITs and should be evaluated along with GAAP net income and income per widely separated share (the many directly similar GAAP measures), together with money upsurge from working activities, investing activities and financing activities, in evaluating the working opening of the Company. Management believes that FFO, FAD, NOI and EBITDA are willing to help to investors as supplemental opening measures since these measures leave out the effect of depreciation, amortization and gains or losses from sales of actual estate, all of that are formed on chronological expenses that practically assumes that the worth of actual estate diminishes predictably over time. Since actual estate values instead have historically risen or depressed with marketplace conditions, these non-GAAP measures can make easy comparisons of working opening between durations and amid other equity REITs. Non-GAAP measures have stipulations in that they do not simulate all of the amounts associated with the Company's results of operations determined in accommodations with GAAP. FFO, FAD, NOI and EBITDA do not act for money generated from working activities in accommodations with GAAP and are not indispensably demonstrative of money existing to account money needs as disclosed in the Company's Consolidated Statements of Cash Flows. FFO, FAD, NOI and EBITDA should not be deliberate as an substitute to net income as an indicator of the Company's working opening or as an substitute to money flows as a measure of liquidity. The Company's computation of these non-GAAP measures may not be similar to likewise patrician measures reported by other companies.
FFO -- Parkway computes FFO in accommodations with standards determined by the National Association of Real Estate Investment Trusts ("NAREIT"), that may not be similar to FFO reported by other REITs that do not conclude the term in accommodations with the stream NAREIT definition. FFO is tangible as net income, computed in accommodations with GAAP, marked down by elite dividends, on the contrary gains or losses from the sales of properties, in addition to actual estate connected debasement and amortization. Adjustments for Parkway's share of partnerships and joint ventures are enclosed in the computation of FFO on the same basis.
Recurring FFO -- In addition to FFO, Parkway moreover discloses repeated FFO, that considers Parkway's share of adjustments for non-recurring lease close fees, gains and losses on extinguishment of debt, gains and losses, merger costs, or other out of the ordinary items. Although this is a non-GAAP measure that differs from NAREIT's clarification of FFO, the Company believes it provides a meaningful display of working performance.
FAD -- There is not a typical clarification determined for FAD. Therefore, the Company's measure of FAD may not be similar to FAD reported by other REITs. Parkway defines FAD as FFO, on the contrary the amortization of share-based compensation, amortization of on top of and next marketplace leases, true line lease adjustments, gains and losses, merger expenses and marked down by repeated non-revenue enhancing funds expenditures for office building improvements, reside improvements and leasing costs. Adjustments for Parkway's share of partnerships and joint ventures are enclosed in the computation of FAD on the same basis.
EBITDA -- Parkway defines EBITDA, a non-GAAP financial measure, as net income before interest expense, amortization of financing costs, amortization of share-based compensation, income taxes, depreciation, amortization, gains and losses on early extinguishment of debt and other gains and losses. Adjustments for Parkway's share of partnerships and joint ventures are enclosed in the computation of EBITDA on the same basis. EBITDA, as distributed by us, is not similar to EBITDA reported by other REITs that do not conclude EBITDA precisely as you do. EBITDA does not act for money generated from working activities in accommodations with GAAP, and should not be deliberate an substitute to working income or net income as an indicator of opening or as an substitute to money flows from working activities as an indicator of liquidity.
NOI, Recurring NOI, Same-Store NOI and Recurring Same-Store NOI -- NOI includes income from actual estate operations less skill working expenses (before interest responsibility and debasement and amortization). In addition to NOI, Parkway discloses repeated NOI, that considers adjustments for non-recurring lease close fees or other out of the ordinary items. The Company's avowal of same-store NOI and repeated same-store NOI includes those properties that were owned during the whole stream and previous stating durations and excludes properties personal as dropped operations.
SOURCE Parkway Properties, Inc.
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