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![]() | Company Profile | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
AMB Property Corporation® is a leading owner, operator and developer of industrial real estate, focused on major hub and gateway distribution markets in the Americas, Europe and Asia. As of December 31, 2009, AMB owned or had investments in, on a consolidated basis or through unconsolidated joint ventures, properties and development projects expected to total approximately 155.1 million square feet (14.4 million square meters) in 47 markets within 14 countries.
AMB invests in properties located predominantly in the infill submarkets of its targeted markets. AMB’s portfolio is comprised primarily of High Throughput Distribution® facilities built for efficiency and located near airports, seaports, ground transportation systems, and population concentrations.
Through its private capital group, AMB provides real estate investment, portfolio management and reporting services to co-investment ventures and clients. The private capital revenue consists of asset management distributions and fees, acquisition and development fees as well as incentive distributions.
The Americas | Europe | Asia | ||||||||||
Operating Portfolio(1) | 118.9 msf | Operating Portfolio(1) | 10.9 msf | Operating Portfolio(1) | 10.4 msf | |||||||
Development Portfolio(2)(3) | 6.0 msf | Development Portfolio(2)(3) | 3.1 msf | Development Portfolio(2)(3) | 5.8 msf | |||||||
Land Inventory(3) | 2,126 acres | Land Inventory(3) | 221 acres | Land Inventory(3) | 141 acres | |||||||
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(1) | The operating portfolio includes the owned and managed portfolio and operating properties held through AMB’s investments in unconsolidated joint ventures that it does not manage (excluded from the owned and managed portfolio) and the location of AMB’s global headquarters. | |
(2) | Includes pre-stabilized development properties. | |
(3) | Includes investments held through unconsolidated joint ventures. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 1 |
![]() | Highlights (dollars in thousands, except per share data) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
For the Quarters Ended December 31, | For the Years Ended December 31, | |||||||||||||||||||||||
2009 | 2008 | % Change | 2009 | 2008 | % Change | |||||||||||||||||||
Revenues(1) | $ | 163,402 | $ | 159,238 | 2.6 | % | $ | 633,842 | $ | 693,563 | (8.6 | %) | ||||||||||||
Adjusted EBITDA(2) | 98,785 | 95,705 | 3.2 | % | 489,998 | 496,980 | (1.4 | %) | ||||||||||||||||
Net loss available to common stockholders | (7,565 | ) | (201,362 | ) | 96.2 | % | (50,077 | ) | (66,451 | ) | 24.6 | % | ||||||||||||
FFO(2) | 43,759 | (169,795 | ) | 125.8 | % | 99,275 | 79,195 | 25.4 | % | |||||||||||||||
FFO, as adjusted(3) | 48,131 | 49,399 | (2.6 | %) | 288,841 | 298,276 | (3.2 | %) | ||||||||||||||||
Per diluted share and unit | ||||||||||||||||||||||||
EPS | $ | (0.05 | ) | $ | (2.06 | ) | 97.6 | % | $ | (0.37 | ) | $ | (0.68 | ) | 45.6 | % | ||||||||
FFO(2) | 0.29 | (1.68 | ) | 117.3 | % | 0.72 | 0.77 | (6.5 | %) | |||||||||||||||
FFO, as adjusted(3) | 0.32 | 0.49 | (34.7 | %) | 2.09 | 2.90 | (27.9 | %) | ||||||||||||||||
Dividends per common share | 0.28 | — | 100.0 | % | 1.12 | 1.56 | (28.2 | %) |
Financial(4) | • $1.4 billion in liquidity • Completed financing activities of more than $1.6 billion of debt extensions, repurchases, repayments and refinances in the fourth quarter; totaling $2.7 billion in 2009 | |
Operations(4) | • 90.7% fourth quarter average occupancy; 91.4% for the full year • (7.3)% fourth quarter cash basis same store NOI;(2)(4.5)% for the full year • Commenced 7.8 msf of leases in the fourth quarter; totaling more than 29.0 msf for the full year • (11.5)% fourth quarter rent changes on renewals and rollover; (6.9)% for the trailing four quarters | |
Capital Deployment(4) | • Reduced vacancy by 2.5 msf in the development portfolio during the fourth quarter and more than 4.9 msf for the full year • Approximately 6.9 msf of vacancy remaining to stabilize the development portfolio • Completed $93 million in dispositions in the fourth quarter and $763 million for the full year • Stabilized capitalization rate on dispositions in 2009 was 6.8% | |
Private Capital(5) | Subsequent to year end, completed $267 million in net capital transactions for the company’s two open-ended funds including: • $150 million investment by AMB consisting of $100 million in AMB Institutional Alliance Fund III and $50 million in AMB Europe Fund I; • $50 million in new third-party equity in AMB Institutional Alliance Fund III; and • $67 million in investor redemption rescissions; the remaining redemption queue currently totals $15 million. | |
(1) | On July 1, 2008, the partners of AMB Partners II (previously, a consolidated co-investment venture) contributed their interests in AMB Partners II to AMB Institutional Alliance Fund III in exchange for interests in AMB Institutional Alliance Fund III, an unconsolidated co-investment venture. Pro forma rental revenues for the year ended December 31, 2008 would have been $585,706 if AMB Partners II had been deconsolidated as of January 1, 2008. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | See page 5 for a reconciliation to derive FFO, as adjusted. | |
(4) | Owned and managed portfolio. | |
(5) | As of February 1, 2010. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 2 |
![]() | Funds From Operations(1)Overview | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
Funds From Operations(1)(2)(3)
(per diluted common share and unit)
(per diluted common share and unit)
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Estimated FFO by Business(1)(2)(6)
(per diluted common share and unit)
(per diluted common share and unit)
For the Years Ended December 31, | ||||||||||||
2007 | 2008 | 2009 | ||||||||||
Real estate operations, net of unallocated overhead | $ | 1.63 | $ | 1.53 | $ | 1.19 | ||||||
Overhead reallocation | 0.44 | 0.46 | 0.24 | |||||||||
Real estate operations FFO | $ | 2.07 | $ | 1.99 | $ | 1.43 | ||||||
% of reported FFO | 58.8 | % | 68.6 | % | 68.4 | % | ||||||
Development Gains | 1.60 | 0.72 | 0.63 | |||||||||
Overhead allocation | (0.32 | ) | (0.33 | ) | (0.13 | ) | ||||||
Development FFO | $ | 1.28 | $ | 0.39 | $ | 0.50 | ||||||
% of reported FFO | 36.4 | % | 13.4 | % | 23.9 | % | ||||||
Private Capital Revenues | 0.29 | 0.65 | 0.27 | |||||||||
Overhead allocation | (0.12 | ) | (0.13 | ) | (0.11 | ) | ||||||
Private Capital FFO | $ | 0.17 | $ | 0.52 | $ | 0.16 | ||||||
% of reported FFO | 4.8 | % | 17.9 | % | 7.7 | % | ||||||
Total FFO, as adjusted | $ | 3.52 | $ | 2.90 | $ | 2.09 | ||||||
Development Gains(1)(2)(5)
(per diluted common share and unit)
(per diluted common share and unit)
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Private Capital Revenue(2)
(per diluted common share and unit)
(per diluted common share and unit)
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(1) | See reporting definitions and supplemental financial measures disclosures. | |
(2) | For all years presented, amounts per diluted common share and unit have been restated in accordance with FASB Staff Position No. EITF 03-6-1, effective January 1, 2009, to present amounts net of allocation to participating securities for unvested restricted shares outstanding at each respective period end. Previously reported FFO per diluted common share and unit for 2008, 2007, 2006, 2005 and 2004 were $0.78, $3.51, $3.12, $2.75 and $2.30, respectively. Previously reported development gains per diluted common share and unit for 2008, 2007, 2006, 2005 and 2004 were $0.73, $1.61, $1.11, $0.47 and $0.09, respectively. Previously reported estimated FFO by business per diluted common share and unit for 2008 and 2007 were $2.92 and $3.51, respectively. Previously reported private capital revenue per diluted common share and unit for 2008, 2007, 2006, 2005 and 2004 were $0.67, $0.30, $0.48, $0.47 and $0.14, respectively. | |
(3) | For a reconciliation of FFO from net income for the years ended December 31, 2008, 2007, 2006, 2005, and 2004, refer to our annual report on Form 10-K for the year ended December 31, 2008. | |
(4) | FFO, as adjusted per diluted common share and unit is $2.09 and $2.90 year-to-date for 2009 and 2008, respectively. See page 5 for a reconciliation to derive FFO, as adjusted. | |
(5) | Excludes co-investment venture partners’ share of development gains. | |
(6) | See page 5 for a reconciliation to derive FFO, as adjusted. | |
(7) | Management revenues consist of asset management distributions or fees, acquisition fees for third party acquisitions and priority distributions, as well as market compensation for development and other services. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 3 |
![]() | Consolidated Statements of Operations(1) (in thousands, except per share data) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
For the Quarters Ended December 31, | For the Years Ended December 31, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Revenues | ||||||||||||||||
Rental revenues(1) | $ | 152,899 | $ | 151,606 | $ | 595,963 | $ | 625,093 | ||||||||
Private capital revenues | 10,503 | 7,632 | 37,879 | 68,470 | ||||||||||||
Total revenues | 163,402 | 159,238 | 633,842 | 693,563 | ||||||||||||
Costs and expenses | ||||||||||||||||
Property operating costs(1) | (49,865 | ) | (44,313 | ) | (189,056 | ) | (179,370 | ) | ||||||||
Depreciation and amortization | (51,869 | ) | (38,233 | ) | (179,894 | ) | (164,188 | ) | ||||||||
General and administrative | (31,131 | ) | (40,643 | ) | (115,253 | ) | (143,962 | ) | ||||||||
Restructuring charges | (2,544 | ) | (12,306 | ) | (6,368 | ) | (12,306 | ) | ||||||||
Fund costs | (238 | ) | (159 | ) | (1,062 | ) | (1,078 | ) | ||||||||
Real estate impairment losses | — | (183,754 | ) | (174,410 | ) | (183,754 | ) | |||||||||
Other expenses(2) | (2,176 | ) | (2,446 | ) | (10,247 | ) | (520 | ) | ||||||||
Total costs and expenses | (137,823 | ) | (321,854 | ) | (676,290 | ) | (685,178 | ) | ||||||||
Other income and expenses | ||||||||||||||||
Development profits, net of taxes | 1,368 | 4,836 | 35,874 | 81,084 | ||||||||||||
Gains from sale or contribution of real estate interests, net | — | — | — | 19,967 | ||||||||||||
Equity in earnings of unconsolidated joint ventures, net | 3,824 | 2,762 | 11,331 | 17,121 | ||||||||||||
Other (expenses) income(2) | (222 | ) | (3,061 | ) | 6,284 | (3,124 | ) | |||||||||
Interest expense, including amortization | (30,790 | ) | (33,775 | ) | (121,459 | ) | (133,955 | ) | ||||||||
Loss on early extinguishment of debt | (11,614 | ) | (131 | ) | (12,267 | ) | (786 | ) | ||||||||
Total other income and expenses, net | (37,434 | ) | (29,369 | ) | (80,237 | ) | (19,693 | ) | ||||||||
Loss from continuing operations | (11,855 | ) | (191,985 | ) | (122,685 | ) | (11,308 | ) | ||||||||
Discontinued operations | ||||||||||||||||
Income (loss) attributable to discontinued operations | 173 | (6,996 | ) | 3,005 | 1,964 | |||||||||||
Development profits, net of taxes | — | — | 53,002 | — | ||||||||||||
Gains (losses) from sale of real estate interests, net of taxes | 1,580 | (281 | ) | 38,718 | 2,594 | |||||||||||
Total discontinued operations | 1,753 | (7,277 | ) | 94,725 | 4,558 | |||||||||||
Net loss | (10,102 | ) | (199,262 | ) | (27,960 | ) | (6,750 | ) | ||||||||
Noncontrolling interests’ share of net (income) loss | ||||||||||||||||
Joint venture partners’ share of net income | (2,234 | ) | (2,954 | ) | (11,063 | ) | (32,855 | ) | ||||||||
Joint venture partners’ and limited partnership unitholders’ share of development profits | (942 | ) | (1,924 | ) | (3,308 | ) | (9,041 | ) | ||||||||
Preferred unitholders | — | (1,432 | ) | (4,295 | ) | (5,727 | ) | |||||||||
Limited partnership unitholders | 161 | 8,160 | 3,625 | 5,063 | ||||||||||||
Total noncontrolling interests’ share of net (income) loss | (3,015 | ) | 1,850 | (15,041 | ) | (42,560 | ) | |||||||||
Net loss attributable to AMB Property Corporation | (13,117 | ) | (197,412 | ) | (43,001 | ) | (49,310 | ) | ||||||||
Preferred stock dividends | (3,950 | ) | (3,950 | ) | (15,806 | ) | (15,806 | ) | ||||||||
Preferred unit redemption discount | 9,759 | — | 9,759 | — | ||||||||||||
Allocation to participating securities(3) | (257 | ) | — | (1,029 | ) | (1,335 | ) | |||||||||
Net loss available to common stockholders | $ | (7,565 | ) | $ | (201,362 | ) | $ | (50,077 | ) | $ | (66,451 | ) | ||||
Net loss per common share (diluted) | $ | (0.05 | ) | $ | (2.06 | ) | $ | (0.37 | ) | $ | (0.68 | ) | ||||
Weighted average common shares (diluted) | 147,047 | 97,584 | 134,321 | 97,404 | ||||||||||||
(1) | On July 1, 2008, the partners of AMB Partners II (previously, a consolidated co-investment venture) contributed their interests in AMB Partners II to AMB Institutional Alliance Fund III in exchange for interests in AMB Institutional Alliance Fund III, an unconsolidated co-investment venture. Pro forma rental revenues for the year ended December 31, 2008 would have been $585,706, and pro forma operating expenses for the year ended December 31, 2008 would have been $169,333, if AMB Partners II had been deconsolidated as of January 1, 2008. | |
(2) | Includes changes in liabilities and assets associated with AMB’s deferred compensation plan for the three and twelve months ended December 31, 2009 of $969 and $7,823, respectively, and for the three and twelve months ended December 31, 2008 of $(4,460) and $(7,828), respectively. | |
(3) | Represents net income attributable to AMB Property Corporation, net of preferred stock dividends, allocated to outstanding unvested restricted shares. For the three and twelve months ended December 31, 2009, there were 919 unvested restricted shares outstanding. For the three and twelve months ended December 31, 2008, there were 856 unvested restricted shares outstanding. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 4 |
![]() | Consolidated Statements of Funds from Operations(1) (in thousands, except per share data) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
For the Quarters Ended December 31, | For the Years Ended December 31, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net loss available to common stockholders | $ | (7,565 | ) | $ | (201,362 | ) | $ | (50,077 | ) | $ | (66,451 | ) | ||||
(Gains) losses from sale or contribution of real estate interests, net of taxes | (1,580 | ) | 281 | (38,718 | ) | (22,561 | ) | |||||||||
Depreciation and amortization | ||||||||||||||||
Total depreciation and amortization | 51,869 | 38,233 | 179,894 | 164,188 | ||||||||||||
Discontinued operations’ depreciation | 57 | 1,412 | 2,042 | 5,011 | ||||||||||||
Non-real estate depreciation | (2,576 | ) | (1,484 | ) | (8,593 | ) | (7,270 | ) | ||||||||
Adjustments to derive FFO from consolidated joint ventures | ||||||||||||||||
Joint venture partners’ noncontrolling interests (Net income) | 2,234 | 2,954 | 11,063 | 32,855 | ||||||||||||
Limited partnership unitholders’ noncontrolling interests (Net loss) | (161 | ) | (8,160 | ) | (3,625 | ) | (5,063 | ) | ||||||||
Limited partnership unitholders’ noncontrolling interests (Development profits) | 11 | 114 | 2,377 | 2,822 | ||||||||||||
FFO attributable to noncontrolling interests | (7,245 | ) | (9,036 | ) | (26,695 | ) | (49,957 | ) | ||||||||
Adjustments to derive FFO from unconsolidated joint ventures | ||||||||||||||||
AMB’s share of net income | (3,824 | ) | (2,762 | ) | (11,331 | ) | (17,121 | ) | ||||||||
AMB’s share of FFO | 12,549 | 10,015 | 42,938 | 42,742 | ||||||||||||
Allocation to participating securities(2) | (10 | ) | — | — | — | |||||||||||
Funds from operations | $ | 43,759 | $ | (169,795 | ) | $ | 99,275 | $ | 79,195 | |||||||
FFO per common share and unit (diluted) | $ | 0.29 | $ | (1.68 | ) | $ | 0.72 | $ | 0.77 | |||||||
Weighted average common shares and units (diluted) | 150,993 | 101,102 | 137,904 | 102,735 | ||||||||||||
Adjustments for impairment charges, restructuring charges, preferred unit redemption discount and debt extinguishment | ||||||||||||||||
Real estate impairment losses | $ | — | $ | 183,754 | $ | 174,410 | $ | 183,754 | ||||||||
Discontinued operations’ real estate impairment losses | — | 10,164 | 7,443 | 10,164 | ||||||||||||
Pursuit costs and tax reserve | — | 11,834 | — | 11,834 | ||||||||||||
AMB’s share of real estate impairment losses from unconsolidated joint ventures | — | 1,847 | 4,611 | 1,847 | ||||||||||||
Joint venture partners’ noncontrolling interest share of real estate impairment losses | — | (424 | ) | (4,876 | ) | (424 | ) | |||||||||
AMB’s share of total impairment charges(1) | — | 207,175 | 181,588 | 207,175 | ||||||||||||
Restructuring charges(1) | 2,544 | 12,306 | 6,368 | 12,306 | ||||||||||||
Loss on early extinguishment of debt | 11,614 | 131 | 12,267 | 786 | ||||||||||||
Preferred unit redemption discount | (9,759 | ) | — | (9,759 | ) | — | ||||||||||
Allocation to participating securities(2) | (27 | ) | (418 | ) | (898 | ) | (1,186 | ) | ||||||||
Funds from operations, as adjusted(1) | $ | 48,131 | $ | 49,399 | $ | 288,841 | $ | 298,276 | ||||||||
FFO, as adjusted per common share and unit (diluted) | $ | 0.32 | $ | 0.49 | $ | 2.09 | $ | 2.90 | ||||||||
Weighted average common shares and units (diluted) | 150,993 | 101,112 | 137,904 | 102,735 | ||||||||||||
(1) | See reporting definitions and supplemental financial measures disclosures. | |
(2) | Represents amount of FFO allocated to outstanding unvested restricted shares. For the three and twelve months ended December 31, 2009, there were 919 unvested restricted shares. For the three and twelve months ended December 31, 2008, there were 856 unvested restricted shares. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 5 |
![]() | Consolidated Balance Sheets (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
As of | ||||||||
December 31, 2009 | December 31, 2008 | |||||||
Assets | ||||||||
Investments in real estate | ||||||||
Total investments in properties | $ | 6,708,660 | $ | 6,603,856 | ||||
Accumulated depreciation and amortization | (1,113,808 | ) | (970,737 | ) | ||||
Net investments in properties | 5,594,852 | 5,633,119 | ||||||
Investments in unconsolidated joint ventures | 462,130 | 431,322 | ||||||
Properties held for sale or contribution, net | 214,426 | 609,023 | ||||||
Net investments in real estate | 6,271,408 | 6,673,464 | ||||||
Cash and cash equivalents and restricted cash | 206,077 | 251,231 | ||||||
Accounts receivable, net | 155,958 | 160,528 | ||||||
Other assets | 208,515 | 216,425 | ||||||
Total assets | $ | 6,841,958 | $ | 7,301,648 | ||||
Liabilities and equity | ||||||||
Liabilities | ||||||||
Secured debt | $ | 1,096,554 | $ | 1,522,571 | ||||
Unsecured senior debt | 1,155,529 | 1,153,926 | ||||||
Unsecured credit facilities | 477,630 | 920,850 | ||||||
Other debt | 482,883 | 392,838 | ||||||
Accounts payable and other liabilities | 338,042 | 345,259 | ||||||
Total liabilities | 3,550,638 | 4,335,444 | ||||||
Equity | ||||||||
Stockholders’ equity | ||||||||
Common equity | 2,716,604 | 2,291,695 | ||||||
Preferred equity | 223,412 | 223,412 | ||||||
Total stockholders’ equity | 2,940,016 | 2,515,107 | ||||||
Noncontrolling interests | ||||||||
Joint venture partners | 289,909 | 293,367 | ||||||
Preferred unitholders | — | 77,561 | ||||||
Limited partnership unitholders | 61,395 | 80,169 | ||||||
Total noncontrolling interests | 351,304 | 451,097 | ||||||
Total equity | 3,291,320 | 2,966,204 | ||||||
Total liabilities and equity | $ | 6,841,958 | $ | 7,301,648 | ||||
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 6 |
![]() | Supplemental Cash Flow Information (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
For the Quarters Ended | For the Years Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
AMB’s Owned and Managed Portfolio:(1)(2) | ||||||||||||||||
Supplemental Information: | ||||||||||||||||
Straight-line rents and amortization of lease intangibles | $ | 9,040 | $ | 5,285 | $ | 29,181 | $ | 24,031 | ||||||||
AMB’s share of straight-line rents and amortization of lease intangibles | $ | 4,599 | $ | 1,498 | $ | 14,099 | $ | 12,065 | ||||||||
Gross lease termination fees | $ | 581 | $ | 5,772 | $ | 6,067 | $ | 6,428 | ||||||||
Net lease termination fees(3) | $ | 407 | $ | 4,777 | $ | 4,324 | $ | 5,185 | ||||||||
AMB’s share of net lease termination fees | $ | 232 | $ | 4,318 | $ | 2,076 | $ | 4,652 | ||||||||
Recurring capital expenditures: | ||||||||||||||||
Tenant improvements | $ | 6,488 | $ | 5,276 | $ | 20,185 | $ | 17,377 | ||||||||
Lease commissions and other lease costs | 6,936 | 6,949 | 26,452 | 27,149 | ||||||||||||
Building improvements | 11,796 | 12,688 | 25,415 | 39,908 | ||||||||||||
Sub-total | 25,220 | 24,913 | 72,052 | 84,434 | ||||||||||||
Co-investment venture partners’ share of capital expenditures | (8,728 | ) | (7,043 | ) | (26,219 | ) | (24,425 | ) | ||||||||
AMB’s share of recurring capital expenditures | $ | 16,492 | $ | 17,870 | $ | 45,833 | $ | 60,009 | ||||||||
AMB’s Consolidated Portfolio: | ||||||||||||||||
Supplemental Information: | ||||||||||||||||
Straight-line rents and amortization of lease intangibles | $ | 3,628 | $ | 1,499 | $ | 10,531 | $ | 10,549 | ||||||||
AMB’s share of straight-line rents and amortization of lease intangibles | $ | 3,407 | $ | 764 | $ | 10,279 | $ | 9,519 | ||||||||
Gross lease termination fees | $ | 320 | $ | 5,077 | $ | 3,134 | $ | 5,634 | ||||||||
Net lease termination fees(3) | $ | 195 | $ | 4,266 | $ | 1,792 | $ | 4,585 | ||||||||
AMB’s share of net lease termination fees | $ | 187 | $ | 4,216 | $ | 1,509 | $ | 4,534 | ||||||||
Recurring capital expenditures: | ||||||||||||||||
Tenant improvements | $ | 4,032 | $ | 4,118 | $ | 11,969 | $ | 13,757 | ||||||||
Lease commissions and other lease costs | 4,038 | 4,725 | 17,312 | 21,444 | ||||||||||||
Building improvements | 9,759 | 10,033 | 19,872 | 32,495 | ||||||||||||
Sub-total | 17,829 | 18,876 | 49,153 | 67,696 | ||||||||||||
Co-investment venture partners’ share of capital expenditures | (2,993 | ) | (2,075 | ) | (7,661 | ) | (10,691 | ) | ||||||||
AMB’s share of recurring capital expenditures | $ | 14,836 | $ | 16,801 | $ | 41,492 | $ | 57,005 | ||||||||
(1) | See Reporting Definitions. | |
(2) | See Supplemental Financial Measures Disclosure for a discussion of owned and managed supplemental cash flow information. | |
(3) | Net lease termination fees are defined as gross lease termination fees less the associated straight-line rent balance. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 7 |
![]() | Operations Overview(1) (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
YTD Same Store Cash-basis NOI Growth Without Lease Termination Fees(2)
![(SAME STORE CASH)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476208.gif)
YTD Average Occupancy(2)
![(AVERAGE OCCUPANCY)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476209.gif)
Rent Change on Renewals and Rollovers(2)(3)
![(RENT CHANGE)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476210.gif)
Lease Expirations as % of Annualized Base Rent (ABR)(2)
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Top Customers
Square | ||||||||||||||||
Feet | ABR | % of ABR | ||||||||||||||
1 | Deutsche Post World Net (DHL) | 3,545,758 | $ | 30,668 | 3.6 | % | ||||||||||
2 | United States Government | 1,355,450 | $ | 20,287 | 2.4 | % | ||||||||||
3 | FedEx Corporation | 1,400,090 | $ | 14,687 | 1.7 | % | ||||||||||
4 | Sagaw a Express | 828,552 | $ | 13,825 | 1.6 | % | ||||||||||
5 | Nippon Express | 1,029,170 | $ | 13,578 | 1.6 | % | ||||||||||
6 | BAX Global/Schenker/Deutsche Bahn | 1,127,451 | $ | 10,450 | 1.2 | % | ||||||||||
7 | La Poste | 902,391 | $ | 8,829 | 1.0 | % | ||||||||||
8 | Panalpina | 1,316,351 | $ | 8,636 | 1.0 | % | ||||||||||
9 | Caterpillar Logistics Services | 543,039 | $ | 7,810 | 0.9 | % | ||||||||||
10 | CEVA Logistics, Inc. | 1,032,000 | $ | 6,933 | 0.8 | % | ||||||||||
Subtotal | 13,080,252 | $ | 135,703 | 15.8 | % | |||||||||||
Top 11-20 Customers | 6,634,092 | 46,682 | 5.6 | % | ||||||||||||
Total | 19,714,344 | $ | 182,385 | 21.4 | % | |||||||||||
(1) | Owned and managed portfolio. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | Represents trailing four quarter data. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 8 |
![]() | Operating Statistics(1) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
Owned & Managed Portfolio(2) | Same Store Pool(2) | |||||||||||||||
Quarter Ended | Quarter Ended | Quarter Ended | Quarter Ended | |||||||||||||
December 31, 2009 | September 30, 2009 | December 31, 2009 | September 30, 2009 | |||||||||||||
Square feet | 132,639,328 | 131,789,032 | 113,692,509 | 114,643,564 | ||||||||||||
Percentage of owned & managed square feet | 85.7 | % | 87.0 | % | ||||||||||||
Occupancy | ||||||||||||||||
Occupancy percentage at period end(2) | 91.2 | % | 91.0 | % | 90.9 | % | 90.8 | % | ||||||||
Occupancy percentage at period end (prior year) | 95.1 | % | 95.4 | % | 95.1 | % | 95.6 | % | ||||||||
Average occupancy percentage(2) | 90.7 | % | 90.4 | % | 90.5 | % | 90.3 | % | ||||||||
Average occupancy percentage (prior year) | 94.9 | % | 95.3 | % | 94.6 | % | 95.1 | % | ||||||||
Weighted average lease terms (years) | ||||||||||||||||
Original | 6.3 | 6.3 | 6.2 | 6.2 | ||||||||||||
Remaining | 3.5 | 3.6 | 3.2 | 3.2 | ||||||||||||
Trailing four quarters statistics | ||||||||||||||||
Tenant retention(2) | 61.2 | % | 61.1 | % | 61.1 | % | 59.5 | % | ||||||||
Rent change on renewals and rollovers(2) | ||||||||||||||||
Percentage | (6.9 | %) | (3.9 | %) | (7.7 | %) | (4.8 | %) | ||||||||
Same space square footage commencing (millions) | 21.7 | 19.6 | 20.2 | 17.5 | ||||||||||||
Second generation TIs and LCs per square foot(2) | ||||||||||||||||
Retained | $ | 1.14 | $ | 1.19 | ||||||||||||
Re-tenanted | $ | 2.61 | $ | 2.80 | ||||||||||||
Weighted average | $ | 1.73 | $ | 1.80 | ||||||||||||
Second generation square footage commencing (millions) | 27.0 | 25.3 | ||||||||||||||
Gross operating margin(2) | 70.9 | % | 72.0 | % | 71.9 | % | 72.0 | % |
Same Store Pool(2) | ||||||||||||||||
Quarter Ended | Year Ended | |||||||||||||||
Cash Basis NOI percent change(2) | December 31, 2009 | December 31, 2009 | ||||||||||||||
Increase (decrease) in revenues excluding lease termination fees(3) | (5.9 | %) | (2.5 | %) | ||||||||||||
Increase (decrease) in expenses(3) | (2.0 | %) | 2.8 | % | ||||||||||||
Increase (decrease) in NOI excluding lease termination fees(2)(3) | (7.3 | %) | (4.5 | %) | ||||||||||||
Increase (decrease) in NOI including lease termination fees(2)(3) | (10.1 | %) | (4.6 | %) |
(1) | Owned and managed portfolio. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | For the quarter ended December 31, 2009, on a consolidated basis, the percent change was (7.9)%, (2.9)%, (10.0)% and (14.7)%, respectively, for decrease in revenues excluding lease termination fees, decrease in expenses, decrease in NOI excluding lease termination fees and decrease in NOI including lease termination fees. For the year ended December 31, 2009, on a consolidated basis, the percent change was (2.8)%, 1.9%, (4.8)% and (5.5)%, respectively, for decrease in revenues excluding lease termination fees, increase in expenses, decrease in NOI excluding lease termination fees and decrease in NOI including lease termination fees. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 9 |
![]() | Portfolio Overview | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
% of Total | Year-to-Date | Trailing Four | ||||||||||||||||||||||||||||||||||||||||||
Owned and | AMB’s Share | Annualized | Same Store NOI | Quarters Rent | ||||||||||||||||||||||||||||||||||||||||
Square Feet | Placed in | Square Feet | Managed Square | of Square | Year-to-Date | Base Rent | Growth Without | Change on | ||||||||||||||||||||||||||||||||||||
as of | Acquired | Operations | Disposed | as of | Feet as of | Feet as of | Average | psf as of | Lease | Renewals and | ||||||||||||||||||||||||||||||||||
9/30/2009 | Square Feet | Square Feet(1) | Square Feet | 12/31/2009 | 12/31/2009 | 12/31/2009 | Occupancy | 12/31/2009 | Termination Fees(2) | Rollovers(2) | ||||||||||||||||||||||||||||||||||
Southern California | 18,917,656 | — | — | — | 18,917,656 | 14.3 | % | 55.6 | % | 92.0 | % | $ | 6.34 | (1.8 | %) | (6.5 | %) | |||||||||||||||||||||||||||
Chicago | 13,106,975 | — | 11,878 | — | 13,118,853 | 9.9 | % | 54.0 | % | 90.4 | % | 5.14 | (2.2 | %) | (15.6 | %) | ||||||||||||||||||||||||||||
No. New Jersey/New York | 11,640,549 | — | (2,127 | ) | — | 11,638,422 | 8.8 | % | 50.8 | % | 90.2 | % | 7.65 | (9.5 | %) | (5.5 | %) | |||||||||||||||||||||||||||
San Francisco Bay Area | 10,994,284 | — | 2,645 | (38,256 | ) | 10,958,673 | 8.3 | % | 76.3 | % | 90.1 | % | 6.33 | (5.2 | %) | (1.8 | %) | |||||||||||||||||||||||||||
Seattle | 7,882,881 | — | 277 | — | 7,883,158 | 5.9 | % | 51.6 | % | 94.1 | % | 5.48 | (5.2 | %) | (0.7 | %) | ||||||||||||||||||||||||||||
South Florida | 6,363,198 | — | — | — | 6,363,198 | 4.8 | % | 72.8 | % | 94.4 | % | 7.37 | (1.0 | %) | (12.4 | %) | ||||||||||||||||||||||||||||
U.S. On-Tarmac | 2,463,001 | — | 89 | — | 2,463,090 | 1.9 | % | 92.4 | % | 89.7 | % | 19.85 | (4.2 | %) | 1.0 | % | ||||||||||||||||||||||||||||
Other U.S. Markets | 28,863,627 | — | 206,368 | (567,748 | ) | 28,502,247 | 21.4 | % | 62.5 | % | 88.9 | % | 5.52 | (7.6 | %) | (11.0 | %) | |||||||||||||||||||||||||||
U.S. Subtotal / Wtd Avg | 100,232,171 | — | 219,130 | (606,004 | ) | 99,845,297 | 75.3 | % | 60.8 | % | 90.9 | % | $ | 6.43 | (5.1 | %) | (7.5 | %) | ||||||||||||||||||||||||||
Canada | 3,564,059 | — | — | — | 3,564,059 | 2.7 | % | 100.0 | % | 95.3 | % | $ | 5.49 | (28.6 | %) | 3.4 | % | |||||||||||||||||||||||||||
Mexico City | 3,590,942 | — | 574,943 | — | 4,165,885 | 3.1 | % | 36.9 | % | 91.4 | % | 5.59 | (18.7 | %) | (14.8 | %) | ||||||||||||||||||||||||||||
Guadalajara | 2,890,526 | — | — | — | 2,890,526 | 2.2 | % | 21.6 | % | 96.7 | % | 4.42 | (2.2 | %) | (13.2 | %) | ||||||||||||||||||||||||||||
Other Mexico Markets | 609,182 | — | 284,318 | — | 893,500 | 0.7 | % | 65.6 | % | 90.5 | % | 4.63 | (26.0 | %) | (8.0 | %) | ||||||||||||||||||||||||||||
Mexico Subtotal / Wtd Avg | 7,090,650 | — | 859,261 | — | 7,949,911 | 6.0 | % | 34.5 | % | 93.5 | % | $ | 5.08 | (12.2 | %) | (14.1 | %) | |||||||||||||||||||||||||||
The Americas Total / Wtd Avg | 110,886,880 | — | 1,078,391 | (606,004 | ) | 111,359,267 | 84.0 | % | 60.1 | % | 91.1 | % | $ | 6.30 | (5.4 | %) | (8.2 | %) | ||||||||||||||||||||||||||
France | 3,785,368 | — | 275,340 | — | 4,060,708 | 3.0 | % | 32.7 | % | 97.6 | % | $ | 8.70 | (0.7 | %) | (14.3 | %) | |||||||||||||||||||||||||||
Germany | 3,191,810 | — | 818 | — | 3,192,628 | 2.4 | % | 30.2 | % | 96.9 | % | 8.98 | (5.5 | %) | (1.8 | %) | ||||||||||||||||||||||||||||
Benelux | 3,267,362 | — | — | — | 3,267,362 | 2.5 | % | 31.2 | % | 91.9 | % | 9.90 | (15.1 | %) | 1.2 | % | ||||||||||||||||||||||||||||
Other Europe Markets | 343,077 | — | — | — | 343,077 | 0.3 | % | 61.9 | % | 100.0 | % | 14.92 | n/a | n/a | ||||||||||||||||||||||||||||||
Europe Subtotal / Wtd Avg | 10,587,617 | — | 276,158 | — | 10,863,775 | 8.2 | % | 32.4 | % | 95.7 | % | $ | 9.32 | (4.7 | %) | (3.9 | %) | |||||||||||||||||||||||||||
Tokyo | 5,263,053 | — | 101,751 | — | 5,364,804 | 4.0 | % | 21.5 | % | 91.6 | % | $ | 14.80 | 4.4 | % | (3.1 | %) | |||||||||||||||||||||||||||
Osaka | 2,000,037 | — | — | — | 2,000,037 | 1.5 | % | 20.0 | % | 90.5 | % | 11.96 | (3.2 | %) | 6.7 | % | ||||||||||||||||||||||||||||
Other Japan Markets | — | — | — | — | — | 0.0 | % | 0.0 | % | 0.0 | % | — | 0.0 | % | n/a | |||||||||||||||||||||||||||||
Japan Subtotal / Wtd Avg | 7,263,090 | — | 101,751 | — | 7,364,841 | 5.5 | % | 21.1 | % | 91.3 | % | $ | 14.07 | 3.4 | % | (0.6 | %) | |||||||||||||||||||||||||||
China | 1,897,400 | — | — | — | 1,897,400 | 1.4 | % | 100.0 | % | 86.1 | % | $ | 4.54 | 3.5 | % | 14.1 | % | |||||||||||||||||||||||||||
Singapore | 935,926 | — | — | — | 935,926 | 0.7 | % | 100.0 | % | 98.4 | % | 9.41 | (0.2 | %) | (4.2 | %) | ||||||||||||||||||||||||||||
Other Asia Markets | 218,119 | — | — | — | 218,119 | 0.2 | % | 100.0 | % | 85.2 | % | 5.96 | 0.0 | % | (15.7 | %) | ||||||||||||||||||||||||||||
Asia Total / Wtd Avg | 10,314,535 | — | 101,751 | — | 10,416,286 | 7.8 | % | 44.2 | % | 91.0 | % | $ | 11.95 | 1.1 | % | (1.6 | %) | |||||||||||||||||||||||||||
Owned and Managed Total / Wtd Avg(2) | 131,789,032 | — | 1,456,300 | (606,004 | ) | 132,639,328 | 100.0 | % | 56.6 | % | 91.4 | % | $ | 6.98 | (4.5 | %) | (6.9 | %) | ||||||||||||||||||||||||||
Other Real Estate Investments(3) | 7,495,959 | — | — | — | 7,495,959 | 51.8 | % | 86.7 | % | 5.31 | ||||||||||||||||||||||||||||||||||
Total Operating Portfolio | 139,284,991 | — | 1,456,300 | (606,004 | ) | 140,135,287 | 56.4 | % | 91.1 | % | $ | 6.90 | ||||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||||||||||||||
Construction-in-Progress | 6,845,041 | 559,605 | (4) | (638,758 | )(5) | (1,504,958 | )(6) | 5,260,930 | 86.6 | % | ||||||||||||||||||||||||||||||||||
Pre-Stabilized Developments(2) | 9,971,598 | 1,431,891 | (4) | (695,924 | )(5) | (1,039,790 | )(6) | 9,667,775 | 97.0 | % | ||||||||||||||||||||||||||||||||||
Development Portfolio Subtotal | 16,816,639 | 1,991,496 | (1,334,682 | ) | (2,544,748 | ) | 14,928,705 | 93.3 | % | |||||||||||||||||||||||||||||||||||
Total Global Portfolio | 156,101,630 | 1,991,496 | 121,618 | (3,150,752 | ) | 155,063,992 | 59.9 | % | ||||||||||||||||||||||||||||||||||||
(1) | Represents assets placed in operations from development and may include positive/(negative) remeasurements of square footage as operating assets. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | Includes operating properties held through AMB’s investments in unconsolidated joint ventures that it does not manage and are therefore excluded from the owned and managed portfolio and the location of AMB’s global headquarters. | |
(4) | For construction-in-progress, represents square footage of development starts. For pre-stabilized developments, represents new projects available. | |
(5) | For construction-in-progress, represents square footage of completed development projects placed in operations. For pre-stabilized developments, represents projects placed in operations. | |
(6) | For construction-in-progress, represents square footage of completed development projects placed in pre-stabilized developments or disposed. For pre-stabilized developments, represents projects disposed. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 10 |
![]() | Capital Deployment Overview (dollars in millions) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
Development Portfolio by Region as of December 31, 2009(1)
(Estimated Total Investment(2))
(Estimated Total Investment(2))
![(PIE CHART)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476212.gif)
Development Starts(1)
(Estimated Total Investment(2))
(Estimated Total Investment(2))
![(BAR CHART)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476213.gif)
Acquisition Volume(3)
(Acquisition Cost(2))
(Acquisition Cost(2))
![(BAR CHART)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476214.gif)
(1) | Includes investments held through unconsolidated co-investment ventures. Estimated total investment is before the impact of real estate impairment losses. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | Owned and managed portfolio, excludes land inventory purchases. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 11 |
![]() | Contributions and Dispositions(1) (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
For the Quarter Ended December 31, 2009 | For the Year Ended December 31, 2009 | |||||||||||||||
Operating Property | Development Property | Operating Property | Development Property | |||||||||||||
AMB’s Ownership Contributed and Disposed | 88.7 | % | 53.1 | % | 66.8 | % | 83.4 | % | ||||||||
Contribution Value and Disposition Price | $ | 23,213 | $ | 69,693 | $ | 198,135 | $ | 564,768 | (2) | |||||||
Weighted Average Stabilized Cap Rate(3)(4) | 8.3 | % | 8.1 | % | 8.2 | % | 6.3 | % | ||||||||
Development Margin(4) | N/A | 8.6 | % | N/A | 16.4 | % |
Square Footage or Acreage Contributed or Sold
For the Quarter Ended December 31, 2009 | For the Year Ended December 31, 2009 | |||||||||||||||||||||||
Operating Property | Development Property | Operating Property | Development Property | |||||||||||||||||||||
Square Feet | Square Feet | Land Acreage(5) | Square Feet | Square Feet | Land Acreage(5) | |||||||||||||||||||
The Americas | ||||||||||||||||||||||||
United States | 403,141 | 1,247,897 | 9 | 2,883,207 | 3,100,676 | 35 | ||||||||||||||||||
Other Americas | — | — | — | — | 318,850 | — | ||||||||||||||||||
The Americas Total | 403,141 | 1,247,897 | 9 | 2,883,207 | 3,419,526 | 35 | ||||||||||||||||||
Europe | ||||||||||||||||||||||||
France | — | — | — | — | — | — | ||||||||||||||||||
Germany | — | — | — | — | — | — | ||||||||||||||||||
Benelux | — | 67,813 | — | — | 67,813 | — | ||||||||||||||||||
Other Europe | — | — | — | — | — | — | ||||||||||||||||||
Europe Total | — | 67,813 | — | — | 67,813 | — | ||||||||||||||||||
Asia | ||||||||||||||||||||||||
Japan | — | — | — | — | 981,162 | — | ||||||||||||||||||
China | — | — | — | — | — | — | ||||||||||||||||||
Other Asia | — | — | — | — | — | — | ||||||||||||||||||
Asia Total | — | — | — | — | 981,162 | — | ||||||||||||||||||
Total | 403,141 | 1,315,710 | 9 | 2,883,207 | 4,468,501 | 35 | ||||||||||||||||||
(1) | Includes investments held through unconsolidated co-investment ventures. | |
(2) | Includes the transfer of two assets to AMB Alliance Fund III in exchange for units in the fund. | |
(3) | Excludes value-added conversions, development for sale, and land sales. | |
(4) | See reporting definitions and supplemental financial measures disclosures. | |
(5) | Represents acreage for land sales and value-added conversion projects. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 12 |
![]() | Development Starts and Completions(1) (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
Development Starts(2) | Development Completions(2) | |||||||||||||||||||||||||||||||||||||||||||||||
For the Quarter Ended December 31, 2009 | For the Year Ended December 31, 2009 | For the Quarter Ended December 31, 2009 | For the Year Ended December 31, 2009 | |||||||||||||||||||||||||||||||||||||||||||||
Estimated | % of Total | Estimated | % of Total | |||||||||||||||||||||||||||||||||||||||||||||
Estimated | Total | Estimated | Estimated | Total | Estimated | Total | % of Total | Total | % of Total | |||||||||||||||||||||||||||||||||||||||
Square Feet | Investment(2) | Investment(2) | Square Feet | Investment(2) | Investment(2) | Square Feet | Investment(3) | Investment(2) | Square Feet | Investment(3) | Investment(2) | |||||||||||||||||||||||||||||||||||||
The Americas | ||||||||||||||||||||||||||||||||||||||||||||||||
United States | — | $ | — | 0.0 | % | 96,250 | $ | 7,248 | 12.0 | % | 451,494 | $ | 25,209 | 19.6 | % | 5,480,272 | $ | 402,692 | 42.5 | % | ||||||||||||||||||||||||||||
Other Americas | — | — | 0.0 | % | 189,337 | 12,116 | 20.0 | % | 957,846 | 52,923 | 41.0 | % | 4,199,238 | 260,513 | 27.5 | % | ||||||||||||||||||||||||||||||||
The Americas Total | — | $ | — | 0.0 | % | 285,587 | $ | 19,364 | 32.0 | % | 1,409,340 | $ | 78,132 | 60.6 | % | 9,679,510 | $ | 663,205 | 70.0 | % | ||||||||||||||||||||||||||||
Europe | ||||||||||||||||||||||||||||||||||||||||||||||||
France | — | $ | — | 0.0 | % | 274,802 | $ | 17,118 | 28.2 | % | 274,802 | $ | 19,018 | 14.8 | % | 376,263 | $ | 33,332 | 3.5 | % | ||||||||||||||||||||||||||||
Germany | — | — | 0.0 | % | — | — | 0.0 | % | — | — | 0.0 | % | — | — | 0.0 | % | ||||||||||||||||||||||||||||||||
Benelux | — | — | 0.0 | % | 125,227 | 24,121 | 39.8 | % | 67,813 | 11,727 | 9.1 | % | 600,960 | 65,529 | 6.9 | % | ||||||||||||||||||||||||||||||||
Other Europe | — | — | 0.0 | % | — | — | 0.0 | % | — | — | 0.0 | % | 436,916 | 40,563 | 4.3 | % | ||||||||||||||||||||||||||||||||
Europe Total | — | $ | — | 0.0 | % | 400,029 | $ | 41,239 | 68.0 | % | 342,615 | $ | 30,745 | 23.9 | % | 1,414,139 | $ | 139,424 | 14.7 | % | ||||||||||||||||||||||||||||
Asia | ||||||||||||||||||||||||||||||||||||||||||||||||
Japan | — | $ | — | 0.0 | % | — | $ | — | 0.0 | % | — | $ | — | 0.0 | % | 685,757 | $ | 115,280 | 12.2 | % | ||||||||||||||||||||||||||||
China | — | — | 0.0 | % | — | — | 0.0 | % | 392,581 | 20,005 | 15.5 | % | 598,850 | 29,760 | 3.1 | % | ||||||||||||||||||||||||||||||||
Other Asia | — | — | 0.0 | % | — | — | 0.0 | % | — | — | 0.0 | % | — | — | 0.0 | % | ||||||||||||||||||||||||||||||||
Asia Total | — | $ | — | 0.0 | % | — | $ | — | 0.0 | % | 392,581 | $ | 20,005 | 15.5 | % | 1,284,607 | $ | 145,040 | 15.3 | % | ||||||||||||||||||||||||||||
Total | — | $ | — | 0.0 | % | 685,616 | $ | 60,603 | 100.0 | % | 2,144,536 | $ | 128,882 | 100.0 | % | 12,378,256 | $ | 947,669 | 100.0 | % | ||||||||||||||||||||||||||||
AMB’s Weighted Average Ownership Percentage | 80 | % | 99.6 | % | 92.0 | % | ||||||||||||||||||||||||||||||||||||||||||
Weighted Average Estimated Yield(2)(4) | 8.1 | % | 7.6 | % | 7.2 | % |
(1) | Includes investments held through unconsolidated co-investment ventures. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | Includes value-added conversions. | |
(4) | Calculated using estimated total investment before the impact of cumulative real estate impairment losses. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 13 |
![]() | Development Portfolio(1) (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
2010 Expected Completions(2) | 2011 Expected Completions(2) | Total Construction-in-Progress | Pre-Stabilized Developments(2) | Total Development Portfolio | ||||||||||||||||||||||||||||||||||||||||
Estimated | Estimated | Estimated | Estimated | Estimated | % of Total | |||||||||||||||||||||||||||||||||||||||
Estimated | Total | Estimated | Total | Estimated | Total | Estimated | Total | Estimated | Total | Estimated | ||||||||||||||||||||||||||||||||||
Square Feet | Investment(2)(3) | Square Feet | Investment(2)(3) | Square Feet | Investment(2)(3) | Square Feet | Investment(2)(3) | Square Feet | Investment(2)(3) | Investment(2) | ||||||||||||||||||||||||||||||||||
The Americas | ||||||||||||||||||||||||||||||||||||||||||||
United States | 389,767 | $ | 36,601 | 559,605 | $ | 67,537 | 949,372 | $ | 104,138 | 2,716,297 | $ | 237,578 | 3,665,669 | $ | 341,716 | 22.2 | % | |||||||||||||||||||||||||||
Other Americas | 607,202 | 46,487 | — | — | 607,202 | 46,487 | 1,715,452 | 96,415 | 2,322,654 | 142,902 | 9.2 | % | ||||||||||||||||||||||||||||||||
The Americas Total | 996,969 | $ | 83,088 | 559,605 | $ | 67,537 | 1,556,574 | $ | 150,625 | 4,431,749 | $ | 333,993 | 5,988,323 | $ | 484,618 | 31.4 | % | |||||||||||||||||||||||||||
Europe | ||||||||||||||||||||||||||||||||||||||||||||
France | 692,754 | $ | 59,927 | — | $ | — | 692,754 | $ | 59,927 | 37,760 | $ | 5,085 | 730,514 | $ | 65,012 | 4.2 | % | |||||||||||||||||||||||||||
Germany | 426,552 | 50,170 | — | — | 426,552 | 50,170 | 139,608 | 19,320 | 566,160 | 69,490 | 4.5 | % | ||||||||||||||||||||||||||||||||
Benelux | 573,352 | 81,649 | — | — | 573,352 | 81,649 | 207,232 | 35,061 | 780,584 | 116,710 | 7.6 | % | ||||||||||||||||||||||||||||||||
Other Europe | — | — | — | — | — | — | 1,022,887 | 115,045 | 1,022,887 | 115,045 | 7.5 | % | ||||||||||||||||||||||||||||||||
Europe Total | 1,692,658 | $ | 191,746 | — | $ | — | 1,692,658 | $ | 191,746 | 1,407,487 | $ | 174,511 | 3,100,145 | $ | 366,257 | 23.8 | % | |||||||||||||||||||||||||||
Asia | ||||||||||||||||||||||||||||||||||||||||||||
Japan | 420,847 | $ | 54,574 | — | $ | — | 420,847 | $ | 54,574 | 2,835,609 | $ | 501,942 | 3,256,456 | $ | 556,516 | 36.1 | % | |||||||||||||||||||||||||||
China | 523,793 | 22,251 | 1,067,058 | 56,525 | 1,590,851 | 78,776 | 598,850 | 29,854 | 2,189,701 | 108,630 | 7.0 | % | ||||||||||||||||||||||||||||||||
Other Asia | — | — | — | — | — | — | 394,080 | 25,749 | 394,080 | 25,749 | 1.7 | % | ||||||||||||||||||||||||||||||||
Asia Total | 944,640 | $ | 76,825 | 1,067,058 | $ | 56,525 | 2,011,698 | $ | 133,350 | 3,828,539 | $ | 557,545 | 5,840,237 | $ | 690,895 | 44.8 | % | |||||||||||||||||||||||||||
Total | 3,634,267 | $ | 351,659 | 1,626,663 | $ | 124,062 | 5,260,930 | $ | 475,721 | 9,667,775 | $ | 1,066,049 | 14,928,705 | $ | 1,541,770 | 100.0 | % | |||||||||||||||||||||||||||
Real estate impairment losses | (28,160 | ) | (84,245 | ) | (112,405 | ) | ||||||||||||||||||||||||||||||||||||||
Estimated total investment, net of real estate impairment losses | $ | 447,561 | $ | 981,804 | $ | 1,429,365 | ||||||||||||||||||||||||||||||||||||||
Number of Projects | 13 | 2 | 15 | 33 | 48 | |||||||||||||||||||||||||||||||||||||||
AMB’s Weighted Average Ownership Percentage | 90.7 | % | 57.9 | % | 82.2 | % | 97.1 | % | 92.5 | % | ||||||||||||||||||||||||||||||||||
Remainder to Invest | $ | 23,661 | $ | 31,160 | $ | 54,821 | $ | 28,841 | $ | 83,662 | ||||||||||||||||||||||||||||||||||
AMB’s Share of Remainder to Invest(2)(4)(5) | $ | 18,300 | $ | 23,833 | $ | 42,133 | $ | 27,014 | $ | 69,147 | ||||||||||||||||||||||||||||||||||
Weighted Average Estimated Yield(2)(5) | 6.6 | % | 7.6 | % | 6.8 | % | 6.8 | % | 6.8 | % | ||||||||||||||||||||||||||||||||||
Percent Pre-Leased(2) | 15.1 | % | 14.8 | % | 15.0 | % | 59.9 | % | 44.1 | % |
(1) | Includes investments held through unconsolidated co-investment ventures. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | Includes value-added conversion projects. | |
(4) | Amounts include capitalized interest as applicable. | |
(5) | Calculated using estimated total investment before the impact of cumulative real estate impairment losses. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 14 |
![]() | Land, Value-Added Conversion, and Redevelopment Inventory(1)(2) (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
Land Inventory
The Americas | Europe | Asia | Total | |||||||||||||||||||||||||||||
Estimated | Estimated | Estimated | Estimated | |||||||||||||||||||||||||||||
Build Out Potential | Build Out Potential | Build Out Potential | Build Out Potential | |||||||||||||||||||||||||||||
Acres | (square feet) | Acres | (square feet) | Acres | (square feet) | Acres | (square feet) | |||||||||||||||||||||||||
Balance as of September 30, 2009 | 2,146 | 35,665,530 | 219 | 4,336,270 | 150 | 5,678,820 | 2,515 | 45,680,620 | ||||||||||||||||||||||||
Acquisitions | — | — | 2 | 67,805 | — | — | 2 | 67,805 | ||||||||||||||||||||||||
Sales | (9 | ) | (60,000 | ) | — | — | — | — | (9 | ) | (60,000 | ) | ||||||||||||||||||||
Development starts | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Other | (11 | ) | — | — | (56,139 | ) | (9 | ) | (533,899 | ) | (20 | ) | (590,038 | ) | ||||||||||||||||||
Balance as of December 31, 2009 | 2,126 | 35,605,530 | 221 | 4,347,936 | 141 | 5,144,921 | 2,488 | (3) | 45,098,387 | |||||||||||||||||||||||
Investment in Land(4) | $ | 575,117 | $ | 118,646 | $ | 143,564 | $ | 837,327 | ||||||||||||||||||||||||
Cumulative real estate impairment losses | $ | (152,686 | ) | |||||||||||||||||||||||||||||
Investment in land, net of cumulative real estate impairment losses | $ | 684,641 | ||||||||||||||||||||||||||||||
AMB’s share of investment in land, net of cumulative real estate impairment losses | $ | 532,239 | ||||||||||||||||||||||||||||||
Value-Added Conversion Inventory(1)(5)
East Region | West Region | Central Region | The Americas | |||||||||||||||||||||||||||||
Number of | Number of | Number of | Number of | |||||||||||||||||||||||||||||
Conversion Time Frame | Acres | Projects | Acres | Projects | Acres | Projects | Acres | Projects | ||||||||||||||||||||||||
3 years or less | — | — | 9 | 1 | — | — | 9 | 1 | ||||||||||||||||||||||||
3+ years | 7 | 2 | 213 | 12 | — | — | 220 | 14 | ||||||||||||||||||||||||
Total | 7 | 2 | 222 | 13 | — | — | 229 | (6) | 15 | |||||||||||||||||||||||
Redevelopment Inventory(1)(5)
East Region | West Region | Central Region | The Americas | |||||||||||||||||||||||||||||
Square | Number of | Square | Number of | Square | Number of | Square | Number of | |||||||||||||||||||||||||
Redevelopment Time Frame | Feet | Projects | Feet | Projects | Feet | Projects | Feet | Projects | ||||||||||||||||||||||||
3 years or less | 40,800 | 1 | — | — | — | — | 40,800 | 1 | ||||||||||||||||||||||||
3+ years | — | — | 998,372 | 3 | — | — | 998,372 | 3 | ||||||||||||||||||||||||
Total | 40,800 | 1 | 998,372 | 3 | — | — | 1,039,172 | (7) | 4 | |||||||||||||||||||||||
(1) | See reporting definitions and supplemental financial measures disclosures. | |
(2) | Includes investments held through unconsolidated co-investment ventures. | |
(3) | AMB’s share of acres and square feet of estimated build out including amounts held in unconsolidated co-investment ventures is 2,258 acres and 41.1 million square feet, respectively. | |
(4) | Represents actual cost incurred to date including initial acquisition, infrastructure, and associated carry costs. | |
(5) | East, West and Central regions represent AMB’s geographic division of the Americas. | |
(6) | AMB’s share is 190 acres. | |
(7) | AMB’s share is 691,171 square feet. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 15 |
![]() | Private Capital Co-investment Ventures Overview (dollars in millions) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
Date | Geographic | Functional | Incentive Distribution | |||||||||
Co-investment Venture | Established | Focus | Principal Venture Investors | Currency | Frequency | Term | ||||||
AMB-SGP | March 2001 | United States | Subsidiary of GIC Real Estate Pte Ltd. | USD | 10 years | March 2011; extendable 10 years | ||||||
AMB Institutional Alliance Fund II | June 2001 | United States | Various | USD | At dissolution | December 2014 (estimated) | ||||||
AMB-AMS | June 2004 | United States | Various | USD | At dissolution | December 2012; extendable 4 years | ||||||
AMB Institutional Alliance Fund III | October 2004 | United States | Various | USD | 3 years (next 2Q11) | Open end | ||||||
AMB-SGP Mexico | December 2004 | Mexico | Subsidiary of GIC Real Estate Pte Ltd. | USD | 7 years | December 2011; extendable 7 years | ||||||
AMB Japan Fund I | June 2005 | Japan | Various | JPY | At dissolution | June 2013; extendable 2 years | ||||||
AMB DFS Fund I | October 2006 | United States | GE Real Estate | USD | Upon project sales | Perpetual(1) | ||||||
AMB Europe Fund I | June 2007 | Europe | Various | EUR | 3 years (next 2Q10) | Open end |
YTD Additions to Private Capital Co-investment Ventures(2)
![(YTD PRIVATE CAPITAL)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476215.gif)
Gross Carrying Value of Private Capital Co-investment Ventures(3)
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(1) | For AMB DFS Fund I, the investment period ended in June 2009. The fund will terminate upon completion and disposition of assets currently owned and under development by the fund. | |
(2) | Additions to private capital co-investment ventures include both acquisitions from third parties as well as assets contributed to co-investment ventures from AMB. | |
(3) | See reporting definitions and supplemental financial measures disclosures. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 16 |
![]() | Joint Ventures Financial Summary (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
AMB’s | Gross | AMB’s | Estimated | Planned | ||||||||||||||||||||||||||||
Ownership | Square | Book | Property | Other | Net Equity | Investment | Gross | |||||||||||||||||||||||||
Unconsolidated Joint Ventures | Percentage | Feet(1) | Value(2) | Debt | Debt | Investment(3) | Capacity | Capitalization | ||||||||||||||||||||||||
Operating Co-Investment Ventures | ||||||||||||||||||||||||||||||||
AMB Institutional Alliance Fund III(4) | 23 | % | 36,057,101 | $ | 3,269,614 | $ | 1,720,405 | $ | — | $ | 209,999 | $ | — | $ | 3,270,000 | |||||||||||||||||
AMB Europe Fund I(4) | 21 | % | 9,236,984 | 1,260,362 | 719,431 | — | 60,177 | — | 1,260,000 | |||||||||||||||||||||||
AMB Japan Fund I | 20 | % | 7,263,090 | 1,498,044 | 832,370 | 8,601 | 80,074 | — | 1,498,000 | |||||||||||||||||||||||
AMB-SGP Mexico | 22 | % | 6,331,990 | 357,493 | 167,180 | 58,825 | 19,014 | 245,000 | 602,000 | |||||||||||||||||||||||
Total Operating Co-investment Ventures | 22 | % | 58,889,165 | 6,385,513 | 3,439,386 | 67,426 | 369,264 | 245,000 | 6,630,000 | |||||||||||||||||||||||
Development Co-investment Ventures: | ||||||||||||||||||||||||||||||||
AMB DFS Fund I | 15 | % | 200,027 | 85,270 | — | — | 14,259 | — | 85,000 | |||||||||||||||||||||||
AMB Institutional Alliance Fund III(4) | 23 | % | 559,605 | 82,547 | 42,376 | — | 9,122 | n/a | n/a | |||||||||||||||||||||||
Total Development Co-investment Ventures | 19 | % | 759,632 | 167,817 | 42,376 | — | 23,381 | — | 85,000 | |||||||||||||||||||||||
Total Unconsolidated Co-investment Ventures(5) | 22 | % | 59,648,797 | 6,553,330 | 3,481,762 | 67,426 | 392,645 | 245,000 | 6,715,000 | |||||||||||||||||||||||
Other Industrial Operating Joint Ventures | 51 | % | 7,419,049 | 6) | 280,432 | 160,290 | — | 50,741 | n/a | n/a | ||||||||||||||||||||||
Total Unconsolidated Joint Ventures | 23 | % | 67,067,846 | $ | 6,833,762 | $ | 3,642,052 | $ | 67,426 | $ | 443,386 | $ | 245,000 | $ | 6,715,000 | |||||||||||||||||
Consolidated Joint Ventures | ||||||||||||||||||||||||||||||||
Operating Co-investment Ventures | ||||||||||||||||||||||||||||||||
AMB-SGP | 50 | % | 8,288,663 | $ | 470,740 | $ | 335,764 | $ | — | |||||||||||||||||||||||
AMB Institutional Alliance Fund II | 20 | % | 7,318,208 | 513,450 | 194,980 | 50,000 | ||||||||||||||||||||||||||
AMB-AMS | 39 | % | 2,172,137 | 158,865 | 79,756 | — | ||||||||||||||||||||||||||
Total Operating Co-investment Ventures | 35 | % | 17,779,008 | 1,143,055 | 610,500 | 50,000 | ||||||||||||||||||||||||||
Total Consolidated Co-investment Ventures | 35 | % | 17,779,008 | 1,143,055 | 610,500 | 50,000 | ||||||||||||||||||||||||||
Other Industrial Operating Joint Ventures | 89 | % | 2,436,591 | 230,463 | 32,186 | — | ||||||||||||||||||||||||||
Other Industrial Development Joint Ventures | 60 | % | 770,442 | 272,237 | 128,374 | — | ||||||||||||||||||||||||||
Total Consolidated Joint Ventures | 47 | % | 20,986,041 | $ | 1,645,755 | $ | 771,060 | $ | 50,000 | |||||||||||||||||||||||
Selected Operating Results | ||||||||||||||||||||||||||||||||
For the Quarter Ended December 31, 2009 | Cash NOI(7) | Net Income | FFO(7) | Share of | Cash NOI(7) | Net Income | FFO(7) | |||||||||||||||||||||||||
Unconsolidated Joint Ventures | $ | 99,109 | $ | 7,180 | (8) | $ | 50,387 | (8) | AMB’s | $ | 23,496 | $ | 3,824 | $ | 12,549 | |||||||||||||||||
Consolidated Joint Ventures | $ | 26,494 | $ | 5,522 | $ | 15,709 | Partner’s | $ | 14,538 | $ | 3,291 | $ | 8,176 | |||||||||||||||||||
Selected Operating Results | ||||||||||||||||||||||||||||||||
For the Year Ended December 31, 2009 | Cash NOI(7) | Net Income | FFO(7) | Share of | Cash NOI(7) | Net Income | FFO(7) | |||||||||||||||||||||||||
Unconsolidated Joint Ventures | $ | 397,117 | $ | 14,702 | (8) | $ | 179,514 | (8) | AMB’s | $ | 88,958 | $ | 11,331 | $ | 42,938 | |||||||||||||||||
Consolidated Joint Ventures | $ | 107,907 | $ | 18,409 | $ | 52,419 | Partner’s | $ | 59,534 | $ | 14,028 | $ | 27,626 |
(1) | For development properties, represents the estimated square feet upon completion for the committed phases of development projects. | |
(2) | Represents the book value of the property (before accumulated depreciation), net of impairments, owned by the joint venture and excludes net other assets. Development book values include uncommitted land. | |
(3) | Through AMB Property Mexico, AMB holds an equity interest in various other non-core unconsolidated ventures for approximately $18.7 million. | |
(4) | The estimated investment capacity and planned gross capitalizations and investment capacities of AMB Institutional Alliance Fund III and AMB Europe Fund I, as open-end funds, are not limited. The planned gross capitalization represents the gross book value of real estate assets as of the most recent quarter end, and the investment capacity represents estimated capacity based on the fund’s current cash and leverage limitations as of the most recent quarter end. | |
(5) | See reporting definitions and supplemental financial measures disclosures for unconsolidated co-investment venture operating results. | |
(6) | Includes investments in 7.3 million square feet of operating properties through AMB’s investment in unconsolidated joint ventures that it does not manage which it excludes from its owned and managed portfolio. | |
(7) | See reporting definitions and supplemental financial measures disclosures. | |
(8) | Excludes $3.8 million and $15.3 million of interest expense on shareholder loans for AMB-SGP Mexico for the quarter and year ended December 31, 2009, respectively. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 17 |
![]() | Capitalization Summary (dollars in millions) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
Value
![(BAR CHART)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476217.gif)
Coverage and Debt Ratios
For the Quarter Ended | For the Year Ended | |||||||
December 31, 2009 | December 31, 2009 | |||||||
Interest coverage(2) | 2.8 | x | 3.6 | x | ||||
Fixed charge coverage(2) | 2.2 | x | 2.6 | x | ||||
Dividends per share-to-FFO, as adjusted per share(2) | 87.5 | % | 53.6 | % | ||||
AMB’s share of total debt-to-total market capitalization(2) | 46.4 | % | 46.4 | % | ||||
AMB’s share of total debt-to-AMB’s share of total assets(2) | 43.6 | % | 43.6 | % |
Capital Structure(1)
![(PIE CHART)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476218.gif)
![(PIE CHART)](https://capedge.com/proxy/8-K/0000950123-10-007510/f54762f5476219.gif)
(1) | Debt amounts represent AMB’s share of debt and preferred securities. | |
(2) | See reporting definitions and supplemental financial measures disclosures. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 18 |
![]() | Capitalization Detail (dollars in thousands, except shares and share price) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
AMB Wholly-Owned | Consolidated Joint Venture | |||||||||||||||||||||||||||||||||||||||
Unsecured | Total | Unconsolidated | ||||||||||||||||||||||||||||||||||||||
Senior | Credit | Other | Secured | Secured | Other | Consolidated | Joint | Total | ||||||||||||||||||||||||||||||||
Debt | Facilities(1) | Debt | Debt | Debt | Debt | Debt | Venture Debt | Debt | ||||||||||||||||||||||||||||||||
2010 | $ | 65,000 | $ | 238,429 | $ | 2,112 | $ | 189,562 | $ | 131,497 | $ | — | $ | 626,600 | $ | 197,198 | $ | 823,798 | ||||||||||||||||||||||
2011 | 69,000 | 239,201 | 2,186 | 88,284 | 120,355 | — | 519,026 | 620,324 | 1,139,350 | |||||||||||||||||||||||||||||||
2012 | — | — | 426,385 | 27,764 | 388,113 | 50,000 | 892,262 | 449,870 | 1,342,132 | |||||||||||||||||||||||||||||||
2013 | 293,897 | — | 920 | 19,611 | 49,938 | — | 364,366 | 712,750 | 1,077,116 | |||||||||||||||||||||||||||||||
2014 | — | — | 616 | — | 5,659 | — | 6,275 | 855,551 | 861,826 | |||||||||||||||||||||||||||||||
2015 | 112,491 | — | 664 | — | 17,610 | — | 130,765 | 264,519 | 395,284 | |||||||||||||||||||||||||||||||
2016 | 250,000 | — | — | — | 16,231 | — | 266,231 | 73,102 | 339,333 | |||||||||||||||||||||||||||||||
2017 | — | — | — | — | 1,272 | — | 1,272 | 351,639 | 352,911 | |||||||||||||||||||||||||||||||
2018 | 125,000 | — | — | — | 1,455 | — | 126,455 | 183,194 | 309,649 | |||||||||||||||||||||||||||||||
2019 | 250,000 | — | — | — | — | — | 250,000 | — | 250,000 | |||||||||||||||||||||||||||||||
Thereafter | — | — | — | — | 39,154 | — | 39,154 | 5,844 | 44,998 | |||||||||||||||||||||||||||||||
Subtotal | $ | 1,165,388 | $ | 477,630 | $ | 432,883 | $ | 325,221 | $ | 771,284 | $ | 50,000 | $ | 3,222,406 | $ | 3,713,991 | $ | 6,936,397 | ||||||||||||||||||||||
Unamortized (discount) premium | (9,859 | ) | — | — | 273 | (224 | ) | — | (9,810 | ) | (4,513 | ) | (14,323 | ) | ||||||||||||||||||||||||||
Subtotal | $ | 1,155,529 | $ | 477,630 | $ | 432,883 | $ | 325,494 | $ | 771,060 | $ | 50,000 | $ | 3,212,596 | $ | 3,709,478 | $ | 6,922,074 | ||||||||||||||||||||||
Joint venture partners’ share of debt(2) | — | — | — | — | (433,601 | ) | (40,000 | ) | (473,601 | ) | (2,868,120 | ) | (3,341,721 | ) | ||||||||||||||||||||||||||
AMB’s share of total debt(2) | $ | 1,155,529 | $ | 477,630 | $ | 432,883 | $ | 325,494 | $ | 337,459 | $ | 10,000 | $ | 2,738,995 | $ | 841,358 | $ | 3,580,353 | ||||||||||||||||||||||
Weighted average interest rate | 6.4 | % | 0.8 | % | 3.9 | % | 3.5 | % | 4.9 | % | 5.8 | % | 4.6 | % | 4.8 | % | 4.7 | % | ||||||||||||||||||||||
Weighted average maturity (years) | 6.1 | 1.0 | 2.8 | 1.0 | 2.7 | 2.7 | 3.5 | 4.1 | 3.8 |
Market Equity | ||||||||||||
Security | Shares | Price | Value | |||||||||
Common Stock | 149,258,376 | (3) | $ | 25.55 | $ | 3,813,552 | ||||||
LP Units | 3,376,141 | $ | 25.55 | 86,260 | ||||||||
Total | 152,634,517 | $ | 3,899,812 | |||||||||
Total options outstanding | 8,107,697 | |||||||||||
Dilutive effect of stock options(4) | — |
Preferred Stock | ||||||||
Dividend | Liquidation | |||||||
Security | Rate | Preference | ||||||
Series L preferred stock | 6.50 | % | 50,000 | |||||
Series M preferred stock | 6.75 | % | 57,500 | |||||
Series O preferred stock | 7.00 | % | 75,000 | |||||
Series P preferred stock | 6.85 | % | 50,000 | |||||
Weighted Average/Total | 6.80 | % | $ | 232,500 | ||||
Capitalization Ratios | ||||
AMB’s share of total debt-to-total market capitalization(2)(5) | 46.4 | % | ||
AMB’s share of total debt plus preferred-to-AMB’s share of total market capitalization(2)(5) | 49.4 | % | ||
AMB’s share of total debt-to-AMB’s share of total assets(2) | 43.6 | % | ||
AMB’s share of total debt plus preferred-to-AMB’s share of total assets(2) | 46.4 | % |
(1) | Represents three credit facilities with total capacity of approximately $1.6 billion. Includes $175.5 million of U.S. Dollar borrowings, as well as $182.9 million, $93.0 million, and $26.2 million in Yen, Canadian dollar and Singapore dollar-based borrowings outstanding at December 31, 2009, respectively, translated to U.S. dollars using the foreign exchange rates in effect on December 31, 2009. | |
(2) | See reporting definitions and supplemental financial measures disclosures. | |
(3) | Includes 918,753 shares of unvested restricted stock. | |
(4) | Computed using the treasury stock method and an average share price of $23.74 for the quarter ended December 31, 2009. All stock options were anti-dilutive as of December 31, 2009. | |
(5) | Total Market Capitalization is defined as total debt plus preferred equity liquidation preferences plus market equity. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 19 |
![]() | Debt Maturities(1) (dollars in thousands) | SUPPLEMENTAL ANALYST PACKAGE 2009 Fourth Quarter Earnings Conference Call | ||
After Extension Options(2) | ||||||||||||||||
AMB Wholly-owned Debt | 2010 | 2011 | 2012 | 2013 | ||||||||||||
Unsecured Senior Debt | $ | 65,000 | $ | 69,000 | $ | — | $ | 293,897 | ||||||||
Credit Facilities | — | 238,429 | 239,201 | — | ||||||||||||
Other Debt | — | — | 427,635 | 1,916 | ||||||||||||
AMB Secured Debt | 188,445 | 87,667 | 28,648 | 20,466 | ||||||||||||
Subtotal | 253,445 | 395,096 | 695,484 | 316,279 | ||||||||||||
Consolidated Joint Ventures | ||||||||||||||||
AMB-AMS | 2,559 | — | — | 39,786 | ||||||||||||
AMB Institutional Alliance Fund II | 10,029 | 31,022 | 5,555 | 93,712 | ||||||||||||
AMB-SGP | — | 42,064 | 293,700 | — | ||||||||||||
Other Industrial Operating Joint Ventures | 56,408 | 42,353 | 8,506 | — | ||||||||||||
Subtotal | 68,996 | 115,439 | 307,761 | 133,498 | ||||||||||||
Unconsolidated Joint Ventures | ||||||||||||||||
AMB Institutional Alliance Fund III | 27,157 | 184,580 | 77,660 | 287,002 | ||||||||||||
AMB Japan Fund I | 112,004 | 204,502 | 179,852 | 344,432 | ||||||||||||
AMB-SGP Mexico | — | 58,825 | 167,180 | — | ||||||||||||
Other Industrial Operating Joint Ventures | 9,059 | 31,995 | — | 58,771 | ||||||||||||
AMB Europe Fund I | — | — | 6,381 | 5,018 | ||||||||||||
Subtotal | 148,220 | 479,902 | 431,073 | 695,223 | ||||||||||||
Total Consolidated | 322,441 | 510,535 | 1,003,245 | 449,777 | ||||||||||||
Total Unconsolidated | 148,220 | 479,902 | 431,073 | 695,223 | ||||||||||||
Total | $ | 470,661 | $ | 990,437 | $ | 1,434,318 | $ | 1,145,000 | ||||||||
Total AMB’s Share | $ | 323,530 | $ | 558,967 | $ | 940,365 | $ | 513,611 |
(1) | Excludes scheduled principal amortization of debt maturing in years subsequent to 2013 as well as debt premiums and discounts. | |
(2) | Subject to certain conditions. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 20 |
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Income Items
Actual | ||||||||
Quarter Ended | ||||||||
December 31, 2009 | ||||||||
Real Estate: | ||||||||
Wholly owned property cash NOI from continuing operations(1) | $ | 72,912 | ||||||
AMB’s share of cash NOI from joint ventures: | ||||||||
Total cash NOI from joint ventures from continuing operations(1) | $ | 125,642 | ||||||
AMB’s share of joint ventures(1) | 28.2 | % | ||||||
AMB’s share of cash NOI from joint ventures from continuing operations(1) | 35,444 | |||||||
Adjustments to AMB’s share of cash NOI: | ||||||||
NOI attributed to construction-in-progress | $ | (136 | ) | |||||
NOI attributed to pre-stabilized development projects(1) | (6,819 | ) | ||||||
NOI attributed to contributed developments | — | |||||||
NOI required to stabilize properties acquired during the quarter | — | |||||||
Other adjustments to AMB’s share of cash NOI:(2) | 3,257 | |||||||
Adjustments to AMB’s share of cash NOI(3) | (3,698 | ) | ||||||
Total AMB’s share of cash NOI from continuing operations related to operating properties(1)(4) | $ | 104,658 | ||||||
Development platform:(3) | ||||||||
Development starts | $ | — | ||||||
Private capital platform: | ||||||||
Total private capital revenue per common share and unit (diluted) | $ | 0.07 |
Assets & Liabilities
As of | ||||
AMB’s share of:(1) | December 31, 2009 | |||
Development, land, and contributed assets:(4) | ||||
Construction-in-progress (invested to date)(5) | $ | 320,923 | ||
Pre-stabilized development projects(1) | 925,143 | |||
Land held for future development(5) | 532,239 | |||
Assets contributed to co-investment ventures(6) | — | |||
Total development, land and contributed assets | $ | 1,778,305 | ||
Debt and preferred securities:(4) | ||||
Total debt | $ | 3,580,353 | ||
Preferred securities | 232,500 | |||
Total debt and preferred securities | $ | 3,812,853 | ||
Other balance sheet items:(4) | ||||
Cash and cash equivalents and restricted cash | $ | 257,647 | ||
Accounts receivable (net) and other assets | 363,261 | |||
Deferred rents receivable and deferred financing costs (net) | (93,484 | ) | ||
Accounts payable and other liabilities | (331,014 | ) | ||
Total other balance sheet items | $ | 196,410 |
(1) | See reporting definitions and supplemental financial measures disclosures. | |
(2) | Other adjustments to AMB’s share of cash NOI include free rent granted in the quarter and non-property related revenues and expenses. | |
(3) | Transaction activity adjustments remove NOI generated from in-progress developments, contributed developments, and projects held for sale or contribution as the value of this real estate is reflected in AMB’s share of development, land, and contributed assets as detailed above. The adjustments also include stabilized NOI for acquisitions. | |
(4) | Includes investments held through unconsolidated joint ventures. | |
(5) | Assets are net of cumulative real estate impairment losses. | |
(6) | Represents AMB’s share of assets contributed to unconsolidated co-investment ventures during the three months ended December 31, 2009. |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 21 |
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Acquisition Costincludes estimated acquisition capital expenditures. Estimated acquisition capital expenditures include immediate building improvements that are taken into consideration when underwriting the purchase of a building or which are incurred to bring a building up to operating standard or to stabilization and incremental building improvements and leasing costs that are incurred in an effort to substantially increase the revenue potential of an existing building.
Adjusted EBITDA.AMB uses adjusted earnings before interest (including the amount of capitalized interest deducted from the determination of development gains), tax, depreciation and amortization, impairment charges, restructuring, losses on early extinguishment of debt and other non-cash charges, stock based compensation amortization, and non-development gains, or adjusted EBITDA, to measure both its operating performance and liquidity. AMB considers adjusted EBITDA to provide investors relevant and useful information because it permits investors to view income from its operations on an unleveraged basis before the effects of tax, non-cash depreciation and amortization expense (including stock-based compensation amortization) or non-development gains. By excluding interest expense, adjusted EBITDA allows investors to measure AMB’s operating performance independent of its capital structure and indebtedness and, therefore, allows for a more meaningful comparison of its operating performance between quarters as well as annual periods and to compare its operating performance to that of other companies, both in the real estate industry and in other industries. AMB considers adjusted EBITDA to be a useful supplemental measure for reviewing its comparative performance with other companies because, by excluding non-cash depreciation and amortization expense, adjusted EBITDA can help the investing public compare the performance of a real estate company to that of companies in other industries. The impairment charges were principally a result of increases in estimated capitalization rates and deterioration in market conditions that adversely impacted values. The restructuring charges reflected costs associated with AMB’s reduction in global headcount and cost structure. Debt extinguishment losses generally included the costs of repurchasing debt securities. AMB repurchased certain tranches of senior unsecured debt to manage its debt maturities in response to the current financing environment, resulting in greater debt extinguishment costs. Although difficult to predict, these items may be recurring given the uncertainty of the current economic climate and its adverse effects on the real estate and financial markets. While not infrequent or unusual in nature, these items result from market fluctuations that can have inconsistent effects on AMB’s results of operations. The economics underlying these items reflect market and financing conditions in the short-term but can obscure AMB’s performance and the value of AMB’s long-term investment decisions and strategies. Management believes adjusted EBITDA is significant and useful to both it and its investors. Adjusted EBITDA more appropriately reflects the value and strength of AMB’s business model and its potential performance isolated from the volatility of the current economic environment and unobscured by costs (or gains) resulting from AMB’s management of its financing profile in response to the tightening of the capital markets. As a liquidity measure, AMB believes that adjusted EBITDA helps investors to analyze its ability to meet debt service obligations and to make quarterly preferred share dividends and unit distributions. Management uses adjusted EBITDA when measuring AMB’s operating performance and liquidity; specifically when assessing its operating performance, and comparing that performance to other companies, both in the real estate industry and in other industries, and when evaluating its ability to meet debt service obligations and to make quarterly preferred share dividends and unit distributions. AMB believes investors should consider adjusted EBITDA, in conjunction with net income (the primary measure of AMB’s performance) and the other required GAAP measures of its performance and liquidity, to improve their understanding of AMB’s operating results and liquidity, and to make more meaningful comparisons of its performance between periods and as against other companies. By excluding interest, taxes, depreciation and amortization, impairment charges, restructuring, debt extinguishment losses, stock-based compensation amortization and other non-cash charges and non-development gains when assessing AMB’s financial performance, an investor is assessing the earnings generated by AMB’s operations, but not taking into account the eliminated expenses or non-development gains incurred in connection with such operations. As a result, adjusted EBITDA has limitations as an analytical tool and should be used in conjunction with AMB’s required GAAP presentations. Adjusted EBITDA does not reflect AMB’s historical cash expenditures or future cash requirements for working capital, capital expenditures or contractual commitments. Adjusted EBITDA also does not reflect the cash required to make interest and principal payments on AMB’ s outstanding debt. While adjusted EBITDA is a relevant and widely used measure of operating performance and liquidity, it does not represent net income or cash flow from operations as defined by GAAP and it should not be considered as an alternative to those indicators in evaluating operating performance or liquidity. Further, AMB’s computation of adjusted EBITDA may not be comparable to EBITDA reported by other companies. Management compensates for the limitations of adjusted EBITDA by providing investors with financial statements prepared according to U.S. GAAP, along with this detailed discussion of adjusted EBITDA and a reconciliation of adjusted EBITDA to net (loss) income, a U.S. GAAP measurement.
The following table reconciles adjusted EBITDA from net (loss) income for the quarters and years ended December 31, 2009 and 2008 (dollars in thousands):
For the Quarters Ended | For the Years Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net loss | $ | (10,102 | ) | $ | (199,262 | ) | $ | (27,960 | ) | $ | (6,750 | ) | ||||
Depreciation and amortization | 51,869 | 38,233 | 179,894 | 164,188 | ||||||||||||
Impairment charges | — | 183,754 | 174,410 | 183,754 | ||||||||||||
Non-cash restructuring charges | 2,544 | 12,306 | 6,368 | 12,306 | ||||||||||||
Loss on early extinguishment of debt | 11,614 | 131 | 12,267 | 786 | ||||||||||||
Stock-based compensation amortization and other non-cash charges | 6,754 | 13,807 | 23,819 | 30,548 | ||||||||||||
Adjustments to derive adjusted EBITDA from unconsolidated joint ventures: | ||||||||||||||||
AMB’s share of net income | (3,824 | ) | (2,762 | ) | (11,331 | ) | (17,121 | ) | ||||||||
AMB’s share of FFO | 12,549 | 10,015 | 42,938 | 42,742 | ||||||||||||
AMB’s share of interest expense | 10,714 | 10,031 | 40,473 | 34,461 | ||||||||||||
Interest expense, including amortization | 30,790 | 33,775 | 121,459 | 133,955 | ||||||||||||
Total discontinued operations, including gains | (1,753 | ) | 7,277 | (41,723 | ) | (24,525 | ) | |||||||||
Adjusted EBITDA attributable to noncontrolling interests | (14,256 | ) | (15,617 | ) | (58,801 | ) | (92,454 | ) | ||||||||
Capitalized interest attributable to development properties sold or contributed | 1,691 | 99 | 16,412 | 19,143 | ||||||||||||
Discontinued operations’ adjusted EBITDA | 195 | 3,918 | 11,773 | 15,947 | ||||||||||||
Adjusted EBITDA | $ | 98,785 | $ | 95,705 | $ | 489,998 | $ | 496,980 | ||||||||
AMB’s share ofcalculations for certain financial measures represent the pro-rata portion of the applicable financial measure based on AMB’s percentage of equity interest in each of the consolidated and unconsolidated co-investment ventures accounted for in the applicable financial measure. AMB believes that “AMB’s share of” calculations are meaningful and useful supplemental measures, which enable both management and investors to assess the operations, earnings and growth of AMB in light of AMB’s ownership interest in its joint ventures and to compare the applicable measure to that of other companies. In addition, it allows for a more meaningful comparison of the applicable measure to that of other companies that do not consolidate any of their joint ventures. “AMB’s share of” calculations are not intended to reflect actual liability should there be a default under loans or a liquidation of the joint ventures. AMB’s computation of “AMB’s share of” measures may not be comparable to that of other real estate companies, as they may use different methodologies for calculating these measures.
AMB’s share of Other Balance Sheet Items.AMB believes that balance sheet information based on GAAP provides the most appropriate information about financial position. However, AMB considers balance sheet information reported on an owned and managed basis (such as AMB’s share of cash and cash equivalents and restricted cash, AMB’s share of accounts receivable (net) and other assets, AMB’s share of deferred rents receivable and deferred financing costs (net), and AMB’s share of accounts payable and other liabilities) to be useful supplemental measures to help the investors better understand AMB’s operating performance. See Reporting Definitions for definitions of “owned and managed” and “AMB’s share of.” AMB believes that AMB’s share of balance sheet items on an owned and managed basis helps management and investors make a comprehensive assessment of AMB’s total real estate portfolio and provides a better understanding of AMB’s operating activities. While such information is helpful to the investor, it does not provide balance sheet information as defined by GAAP and is not a true alternative to such GAAP measurements. Further, AMB’s computation of its share of balance sheet items on an owned and managed basis may not be comparable to that of other real estate companies, as they may use different methodologies for calculating these measures.
AMB’s share of total debt.AMB’s share of total debt is the pro rata portion of the total debt based on its percentage of equity interest in each of the consolidated and unconsolidated joint ventures holding the debt. AMB believes that its share of total debt is a meaningful supplemental measure, which enables both management and investors to analyze its leverage and to compare its leverage to that of other companies. In addition, it allows for a more meaningful comparison of its debt to that of other companies that do not consolidate their joint ventures. AMB’s share of total debt is not intended to reflect its actual liability should there be a default under any or all of such loans or a liquidation of the joint ventures. See Capitalization Detail for a reconciliation of total debt and AMB’s share of total debt.
AMB’s share of total debt-to-AMB’s share of total assetsis calculated using the following definitions: AMB’s share of total debt is the pro rata portion of the total debt based on AMB’s percentage of equity interest in each of the consolidated and unconsolidated joint ventures holding the debt. AMB’s share of total assets is the pro rata portion of total gross book value of assets based on AMB’s percentage of equity interest in each of the consolidated and unconsolidated joint ventures holding the assets.
AMB’s share of total debt-to-total market capitalizationis calculated using the following definitions: AMB’s share of total debt is the pro rata portion of the total debt based on AMB’s percentage of equity interest in each of the consolidated and unconsolidated joint ventures holding the debt. AMB’s definition of “total market capitalization” is AMB’s share of total debt plus preferred equity liquidation preferences plus market equity. AMB’s definition of “market equity” is the total number of outstanding shares of AMB’s common stock and common limited partnership units multiplied by the closing price per share of its common stock as of the period end.
Annualized base rent (ABR)is calculated as monthly base rent (cash basis) per the lease, as of a certain date, multiplied by 12. If free rent is granted, then the first positive rent value is used. Leases denominated in foreign currencies are translated using the currency exchange rate at period end.
Assets Under Managementis AMB’s estimate of the value of the real estate it wholly owns or manages through its consolidated and unconsolidated co-investment ventures or for clients of AMB Capital Partners. Assets under management is calculated by adding the co-investment venture partner‘s or client‘s share of the carrying value of its real estate investment to AMB’s share of total market capitalization.
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 22 |
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Average occupancy percentagerepresents the daily weighted occupancy of the total rentable square feet leased, including month-to-month leases, divided by total rentable square feet. Space is considered leased when the tenant has either taken physical or economic occupancy.
Carrying valueis the sum of the most recent valuation of real estate investments plus subsequently incurred capital expenditures. Generally, each real estate investment is valued once a year.
Cash-basis NOI.Cash-basis NOI is defined as NOI less straight line rents and amortization of lease intangibles. AMB considers cash-basis NOI to be an appropriate and useful supplemental performance measure because cash basis NOI reflects the operating performance of the real estate portfolio excluding the effects of non-cash adjustments and provides a better measure of actual cash basis rental growth for a year-over-year comparison. However, cash-basis NOI should not be viewed as an alternative measure of financial performance since it does not reflect general and administrative expenses, interest expenses, depreciation and amortization costs, capital expenditures and leasing costs, or trends in development and construction activities that could materially impact results from operations. Further, cash-basis NOI may not be comparable to that of other real estate investment trusts, as they may use different methodologies for calculating cash-basis NOI.
For a reconciliation of NOI from net income for the quarter ended December 31, 2009, refer to the SS NOI definition. The following table reconciles AMB’s share of cash-basis NOI from NOI for the quarter ended December 31, 2009 (dollars in thousands):
For the Quarter Ended | ||||
December 31, 2009 | ||||
NOI | $ | 103,034 | ||
Straight-line rents and amortization of lease intangibles | (3,628 | ) | ||
Consolidated joint venture cash NOI from continuing operations | (26,494 | ) | ||
Wholly-owned property cash NOI | 72,912 | |||
AMB’s share of consolidated joint venture cash NOI | 11,956 | |||
AMB’s share of unconsolidated joint venture cash NOI | 23,488 | |||
AMB’s share of transaction adjustments | (3,698 | ) | ||
AMB’s share of cash-basis NOI | $ | 104,658 | ||
Co-investment Venturesare Joint Ventures with institutional investors, managed by AMB from which AMB receives acquisition fees for third-party acquisitions, portfolio and asset management distributions or fees, as well as incentive distributions or promoted interests.
Co-investment venture partner’s (or co-investor’s) share of debtis the co-investment venture partner’s pro-rata portion of total debt.
Co-investment venture partner’s (or co-investor’s) share of equityis the pro-rata portion of the co-investment venture partner’s share of carrying value less the co-investment venture partner’s share of debt.
Completionis generally defined as properties that have reached Stabilization or properties that have been substantially complete for at least 12 months.
Development activitiesinclude ground-up development, redevelopments, renovations, land sales and value-added conversions.
Development marginis calculated as contribution value or disposition price less closing costs, minus estimated total investment, before the impact of cumulative real estate impairment losses, and any deferred rents, taxes or third party promotes before any deferrals on contributions, divided by the estimated total investment, before the impact of cumulative real estate impairment losses.
Estimated FFO by Business.Estimated FFO by Business is FFO, as adjusted generated by AMB’s Real Estate Operations, Development and Private Capital business. Estimated Development and Private Capital FFO was determined by reducing Development Profits, net of taxes, and Private Capital revenues by their respective estimated share of general and administrative expenses, also defined as overhead. Development’s and Private Capital’s estimated allocation of total general and administrative expenses was based on their respective percentage of actual direct general and administrative expenses incurred. Estimated Real Estate Operations FFO represents total AMB FFO, as adjusted less estimated FFO, as adjusted attributable to Development and Private Capital. Management believes estimated FFO by business line is a useful supplemental measure of its operating performance because it helps the investing public compare the operating performance of AMB’s respective businesses to other companies’ comparable businesses. Further, AMB’s computation of FFO by business line may not be comparable to that reported by other real estate investment trusts as they may use different methodologies in computing such measures.
Estimated investment capacityis AMB’s estimate of the gross real estate which could be acquired through the use of its equity commitments from co-investment venture partners plus AMB’s funding obligations and estimated debt capitalization.
Estimated total investmentrepresents total estimated cost of development, renovation, or expansion, including initial acquisition costs, prepaid ground leases, buildings, and associated carry costs. Estimated total investments are based on current forecasts and are subject to change. Non-U.S. Dollar investments are translated to U.S. Dollars using the exchange rate at period end.
Co-investment venture operating results.
For the Quarter Ended December 31, 2009 | ||||||||||||||||||||||||||||
Income | ||||||||||||||||||||||||||||
AMB's | Property | (Loss) from | ||||||||||||||||||||||||||
Ownership | Operating | Continuing | Net | |||||||||||||||||||||||||
Percentage(1) | Revenues | Expenses | Operations | Income (Loss) | Cash NOI | FFO | ||||||||||||||||||||||
Unconsolidated Co-investment Ventures | ||||||||||||||||||||||||||||
AMB Institutional Alliance Fund III | 23 | % | $ | 67,332 | $ | (17,775 | ) | $ | 3,110 | $ | 3,885 | $ | 46,201 | $ | 23,674 | |||||||||||||
AMB Europe Fund I | 21 | % | 25,233 | (4,440 | ) | (196 | ) | (196 | ) | 19,967 | 10,717 | |||||||||||||||||
AMB Japan Fund I | 20 | % | 25,909 | (5,864 | ) | 2,866 | 2,866 | 19,703 | 10,100 | |||||||||||||||||||
AMB-SGP Mexico | 22 | % | 9,534 | (2,260 | ) | (1,233 | )(1) | (1,233 | )(1) | 6,504 | 1,862 | (1) | ||||||||||||||||
AMB DFS Fund I | 15 | % | — | (434 | ) | (819 | ) | (819 | ) | (439 | ) | (819 | ) | |||||||||||||||
Consolidated Co-investment Ventures | ||||||||||||||||||||||||||||
AMB-SGP | 50 | % | 11,276 | (3,286 | ) | (231 | ) | (231 | ) | 7,620 | 3,208 | |||||||||||||||||
AMB Institutional Alliance Fund II | 20 | % | 12,834 | (3,244 | ) | 2,423 | 2,423 | 9,549 | 5,760 | |||||||||||||||||||
AMB-AMS | 39 | % | 3,982 | (1,043 | ) | 531 | 531 | 2,924 | 1,591 |
(1) Excludes $3.8 million of interest expense on loans from co-investment venture partners. |
Co-investment venture partner’s share ofcalculations for certain financial measures represent the pro-rata portion of the applicable financial measure based on AMB’s co-investment venture partners’ percentage of equity interest in each of the consolidated or unconsolidated co-investment ventures accounted for in the applicable financial measure.
Estimated yields on development projectsare calculated from estimated annual cash NOI following occupancy stabilization divided by the estimated total investment. Yields exclude value added conversion projects and are calculated on an after-tax basis for international projects.
Fixed charge coverage.Fixed charge coverage is defined as Adjusted EBITDA divided by fixed charges. Fixed charges consist of interest expense less joint venture partner’s share of interest expense and amortization of finance costs and debt premiums, from continuing and discontinued operations, plus AMB’s share of interest expense from unconsolidated joint venture debt, capitalized interest, preferred unit distributions and preferred stock dividends. AMB uses fixed charge coverage to measure its liquidity. AMB believes fixed charge coverage is relevant and useful to investors because it permits fixed income investors to measure AMB’s ability to meet its interest payments on outstanding debt, make distributions to its preferred unitholders and pay dividends to its preferred shareholders. AMB’s computation of fixed charge coverage may not be comparable to fixed charge coverage reported by other companies.
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 23 |
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The following table details the calculation of fixed charges for the quarters and years ended December 31, 2009 and 2008 (dollars in thousands):
For the Quarters Ended | For the Years Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
Fixed charge | 2009 | 2008 | 2009 | 2008 | ||||||||||||
Interest expense, including amortization — continuing operations | $ | 30,790 | $ | 33,775 | $ | 121,459 | $ | 133,955 | ||||||||
Amortization of financing costs and debt premiums — continuing operations | (3,048 | ) | (2,681 | ) | (11,695 | ) | (9,068 | ) | ||||||||
Interest expense, including amortization — discontinued operations | 35 | 662 | 706 | 1,192 | ||||||||||||
Amortization of financing costs and debt premiums — discontinued operations | — | (3 | ) | (4 | ) | (13 | ) | |||||||||
Joint venture partner’s share of interest expense | (6,814 | ) | (8,003 | ) | (26,684 | ) | (40,930 | ) | ||||||||
AMB’s share of interest expense from unconsolidated joint ventures | 10,714 | 10,031 | 40,473 | 34,461 | ||||||||||||
Capitalized interest | 9,068 | 15,447 | 42,683 | 64,354 | ||||||||||||
Preferred unit distributions | — | 1,432 | 4,295 | 5,727 | ||||||||||||
Preferred stock dividends | 3,950 | 3,950 | 15,806 | 15,806 | ||||||||||||
Total fixed charge | $ | 44,695 | $ | 54,610 | $ | 187,039 | $ | 205,484 | ||||||||
Funds From Operations (“FFO”), Funds From Operations Per Share and Unit (“FFOPS”) and FFO, as adjusted (together with FFO and FFOPS, the “FFO Measures”).AMB believes that net income, as defined by U.S. GAAP, is the most appropriate earnings measure. However, AMB considers funds from operations, or FFO, FFO per share and unit, or FFOPS, and FFO, as adjusted to be useful supplemental measures of its operating performance. AMB defines FFOPS as FFO per fully diluted weighted average share of AMB’s common stock and operating partnership units. AMB calculates FFO as net income available to common stockholders, calculated in accordance with U.S. GAAP, less gains (or losses) from dispositions of real estate held for investment purposes and real estate-related depreciation, and adjustments to derive AMB’s pro rata share of FFO of consolidated and unconsolidated joint ventures.
Unless stated otherwise, AMB includes the gains from development, including those from value-added conversion projects, before depreciation recapture, as a component of FFO. AMB believes gains from development should be included in FFO to more completely reflect the performance of one of our lines of business. AMB believes that value-added conversion dispositions are in substance land sales and as such should be included in FFO, consistent with the real estate investment trust industry’s long standing practice to include gains on the sale of land in FFO. However, AMB’s interpretation of FFO or FFOPS may not be consistent with the views of others in the real estate investment trust industry, who may consider it to be a divergence from the NAREIT definition, and may not be comparable to FFO or FFOPS reported by other real estate investment trusts that interpret the current NAREIT definition differently than AMB does. In connection with the formation of a joint venture, AMB may warehouse assets that are acquired with the intent to contribute these assets to the newly formed venture. Some of the properties held for contribution may, under certain circumstances, be required to be depreciated under U.S. GAAP. If this circumstance arises, AMB intends to include in its calculation of FFO gains or losses related to the contribution of previously depreciated real estate to joint ventures. Although such a change, if instituted, will be a departure from the current NAREIT definition, AMB believes such calculation of FFO will better reflect the value created as a result of the contributions. To date, AMB has not included gains or losses from the contribution of previously depreciated warehoused assets in FFO.
In addition to presenting FFO as described above, AMB presents FFO, as adjusted. AMB calculates FFO, as adjusted, as FFO less impairment and restructuring charges, debt extinguishment losses and the Series D preferred unit redemption discount. The impairment charges were principally a result of increases in estimated capitalization rates and deterioration in market conditions that adversely impacted values. The restructuring charges reflected costs associated with AMB’s reduction in global headcount and cost structure. Debt extinguishment losses generally included the costs of repurchasing debt securities. AMB repurchased certain tranches of senior unsecured debt to manage its debt maturities in response to the current financing environment, resulting in greater debt extinguishment costs. The Series D preferred unit redemption discount reflects the gain associated with the discount to liquidation preference in the Series D preferred unit redemption price less costs incurred as a result of the redemption. Although difficult to predict, these items may be recurring given the uncertainty of the current economic climate and its adverse effects on the real estate and financial markets. While not infrequent or unusual in nature, these items result from market fluctuations that can have inconsistent effects on AMB’s results of operations. The economics underlying these items reflect market and financing conditions in the short-term but can obscure AMB’s performance and the value of AMB’s long-term
investment decisions and strategies. Management believes FFO, as adjusted, is significant and useful to both it and its investors. FFO, as adjusted, more appropriately reflects the value and strength of AMB’s business model and its potential performance isolated from the volatility of the current economic environment and unobscured by costs (or gains) resulting from AMB’s management of its financing profile in response to the tightening of the capital markets. However, in addition to the limitations of FFO Measures generally discussed below, FFO, as adjusted, does not present a comprehensive measure of AMB’s financial condition and operating performance. This measure is a modification of the NAREIT definition of FFO and should not be considered a replacement of FFO as AMB defines it or used as an alternative to net income or cash as defined by U.S. GAAP.
AMB believes that the FFO Measures are meaningful supplemental measures of its operating performance because historical cost accounting for real estate assets in accordance with U.S. GAAP implicitly assumes that the value of real estate assets diminishes predictably over time, as reflected through depreciation and amortization expenses. However, since real estate values have historically risen or fallen with market and other conditions, many industry investors and analysts have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient. Thus, the FFO Measures are supplemental measures of operating performance for real estate investment trusts that exclude historical cost depreciation and amortization, among other items, from net income available to common stockholders, as defined by U.S. GAAP. AMB believes that the use of the FFO Measures, combined with the required U.S. GAAP presentations, has been beneficial in improving the understanding of operating results of real estate investment trusts among the investing public and making comparisons of operating results among such companies more meaningful. AMB considers the FFO Measures to be useful measures for reviewing comparative operating and financial performance because, by excluding gains or losses related to sales of previously depreciated operating real estate assets and real estate depreciation and amortization, the FFO Measures can help the investing public compare the operating performance of a company’s real estate between periods or as compared to other companies. While FFO and FFOPS are relevant and widely used measures of operating performance of real estate investment trusts, the FFO Measures do not represent cash flow from operations or net income as defined by U.S. GAAP and should not be considered as alternatives to those measures in evaluating AMB’s liquidity or operating performance. The FFO Measures also do not consider the costs associated with capital expenditures related to AMB’s real estate assets nor are the FFO Measures necessarily indicative of cash available to fund AMB’s future cash requirements. Management compensates for the limitations of the FFO Measures by providing investors with financial statements prepared according to U.S. GAAP, along with this detailed discussion of the FFO Measures and a reconciliation of the FFO Measures to net income available to common stockholders, a U.S. GAAP measurement.
See Consolidated Statements of Funds from Operations for a reconciliation of FFO from net income available to common stockholders.
The following table reconciles projected FFO, as adjusted excluding AMB’s share of development gains (or “Core FFO“) from projected net income available to common stockholders for the year ended December 31, 2010:
2010 | ||||||||
Low | High | |||||||
Projected net income available to common stockholders | $ | 0.03 | $ | 0.10 | ||||
AMB’s share of projected depreciation and amortization | 1.27 | 1.27 | ||||||
AMB’s share of projected gains on disposition of operating properties recognized to date | (0.01 | ) | (0.01 | ) | ||||
Impact of additional dilutive securities, other, rounding | (0.03 | ) | (0.03 | ) | ||||
Projected Funds From Operations (FFO) | $ | 1.26 | $ | 1.33 | ||||
Restructuring charges | 0.02 | 0.02 | ||||||
AMB’s share of development gains recognized to date | (0.02 | ) | (0.02 | ) | ||||
Projected FFO, as adjusted excluding AMB’s share of development gains (or “Core FFO”)(1) | $ | 1.26 | $ | 1.33 | ||||
Amounts are expressed per share, except FFO and FFO, as adjusted excluding AMB’s share of development gains, which is expressed per share and unit.
(1) As development gains are difficult to predict in the current economic environment, management believes Projected FFO, as adjusted excluding AMB’s share of development gains is the more appropriate and useful measure to reflect its assessment of AMB’s projected operating performance.
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 24 |
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Gross operating marginis calculated as NOI divided by gross revenues (excluding straight-line rents and amortization of lease intangibles, reimbursable capital revenue and lease termination fees) for properties in the pool at period end.
Impairment chargesrepresent the write down of assets due to estimated fair value being lower than carry value.
Interest coverage.Interest coverage is defined as adjusted EBITDA divided by AMB’s share of interest expense which consists of consolidated interest expense less joint venture partner’s share of interest expense, including amortization, from continuing and discontinued operations and AMB’s share of interest expense from unconsolidated joint venture debt. AMB uses interest coverage to measure its liquidity. AMB believes interest coverage is relevant and useful to investors because it permits investors to measure AMB’s ability to meet its interest payments on outstanding debt. AMB’s computation of interest coverage may not be comparable to interest coverage reported by other companies.
The following table details AMB’s share of total interest for the quarters and years ended December 31, 2009 and 2008 (dollars in thousands):
For the Quarters Ended | For the Years Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
Interest | 2009 | 2008 | 2009 | 2008 | ||||||||||||
Interest expense, including amortization — continuing operations | $ | 30,790 | $ | 33,775 | $ | 121,459 | $ | 133,955 | ||||||||
Interest expense, including amortization — discontinued operations | 35 | 662 | 706 | 1,192 | ||||||||||||
Joint venture partners’ share of interest expense | (6,814 | ) | (8,003 | ) | (26,684 | ) | (40,930 | ) | ||||||||
AMB’s share of interest expense from unconsolidated co-investment ventures | 10,714 | 10,031 | 40,473 | 34,461 | ||||||||||||
Total interest | $ | 34,725 | $ | 36,465 | $ | 135,954 | $ | 128,678 | ||||||||
Joint Venturesare all joint ventures, including Co-Investment Ventures, with real estate developers, other real estate operators, or institutional investors where AMB may or may not: have control, act as the manager and/or developer, earn asset management distributions or fees, or earn incentive distributions or promoted interests. In certain cases, AMB might provide development, leasing, property management and/or accounting services for which it may receive market compensation.
Joint venture partner’s shareof calculations for certain financial measures represent the pro-rata portion of the applicable financial measure based on AMB’s joint venture partners’ percentage of equity interest in each of the consolidated or unconsolidated joint ventures accounted for in the applicable financial measure.
Market equityis defined as the total number of outstanding shares of AMB’s common stock and common limited partnership units multiplied by the closing price per share of its common stock at period end.
Net Asset Value (“NAV”).AMB believes NAV is a useful supplemental measure of its operating performance because it enables both management and investors to analyze the fair value of its business. An assessment of the fair value of a business involves estimates and assumptions and can be performed using various methods. AMB has presented certain financial measures related to its business that it believes may be useful to the investing public in calculating its NAV but has not presented any specific methodology nor provided any guidance on assumptions or estimates that should be used in the calculation.
Net Operating Income (“NOI”).See same store net operating income for discussion of NOI and a reconciliation of NOI from net income.
Occupancy percentage at period endrepresents the percentage of total rentable square feet leased, including month-to-month leases, divided by total rentable square feet at period end. Space is considered leased when the tenant has either taken physical or economic occupancy.
Owned and managedis defined by AMB as assets in which AMB has at least a 10% ownership interest, is the property or asset manager, and which it intends to hold for the long-term.
Owned and Managed Supplemental Cash Flow Information.AMB believes that cash flow information based on GAAP provides the most appropriate cash flow information. However, AMB considers cash flow information reported on an owned and managed basis (such as straight-line rents and amortization of lease
intangibles, AMB’s share of straight-line rents and amortization of lease intangibles, gross lease termination fees, net lease termination fees, AMB’s share of net lease termination fees, tenant improvements, lease commissions and other lease costs, building improvements, Co-investment partners’ share of capital expenditures and AMB’s share of recurring capital expenditures) to be useful supplemental measures to help the investors better understand AMB’s operating performance and cash flow. See Reporting Definitions for definitions of “owned and managed”, “AMB’s share of” and “Co-investment venture partners’ share of”. AMB believes that owned and managed cash flow information helps management and investors make a comprehensive assessment of the cash flow of AMB’s total real estate portfolio and provides a better understanding of AMB’s operating performance and activities. While owned and managed supplemental cash flow information is helpful to the investor, it does not provide cash flow information as defined by GAAP and are not true alternatives to such GAAP measurements. Further, AMB’s computation of owned and managed supplemental cash flow information may not be comparable to that of other real estate companies, as they may use different methodologies for calculating these measures.
Percent pre-leasedrepresents the executed lease percentage of total square feet as of the reporting data.
Pre-stabilized developmentrepresents assets which have reached Completion but have not yet reached Stabilization.
Preferred,with respect to the capitalization ratios, is defined as preferred equity liquidation preferences.
Renovation projectsrepresent projects where the acquired buildings are less than 75% leased and require significant capital expenditures (generally ranging from 10% — 25% of acquisition cost) to bring the buildings up to operating standards and stabilization (generally 90% leased).
Redevelopment projectsrepresent those buildings that require significant capital expenditures (generally more than 25% of acquired cost or existing basis) to bring the buildings up to operating standards and stabilization (generally 90% leased).
Recurring capital expendituresrepresents non-incremental building improvements and leasing costs required to maintain current revenues. Recurring capital expenditures do not include estimated acquisition capital expenditures which were taken into consideration when underwriting the purchase of a building or which are incurred to bring a building up to operating standards.
Rent changes on renewals and rolloversare calculated as the difference, weighted by square feet, of the net ABR due the first month of a term commencement and the net ABR due the last month of the former tenant’s term. If free rent is granted, then the first positive full rent value is used as a point of comparison. The rental amounts exclude base stop amounts, holdover rent and premium rent charges. If either the previous or current lease terms are under 12 months, then they are excluded from this calculation. If the lease is first generation or there is no prior lease for comparison, then it is excluded from this calculation.
Same Store Net Operating Income, Cash-basis SS NOI (“SS NOI”) and Net Operating Income (“NOI”). AMB defines NOI as rental revenues, including reimbursements, less property operating expenses. NOI excludes depreciation, amortization, general and administrative expenses, restructuring charges, real estate impairment losses, development profits (losses), gains (losses) from sale or contribution of real estate interests, and interest expense. AMB believes that net income, as defined by GAAP, is the most appropriate earnings measure. However, NOI is a useful supplemental measure calculated to help investors understand AMB’s operating performance, excluding the effects of costs and expenses which are not related to the performance of the assets. NOI is widely used by the real estate industry as a useful supplemental measure, which helps investors compare AMB’s operating performance with that of other companies. Real estate impairment losses have been excluded in deriving NOI because AMB does not consider its impairment losses to be a property operating expense. AMB believes that the exclusion of impairment losses from NOI is a common methodology used in the real estate industry. Real estate impairment losses relate to the changing values of AMB’s assets but do not reflect the current operating performance of the assets with respect to their revenues or expenses. AMB’s real estate impairment losses are non-cash charges which represent the write down in the value of assets when estimated fair value over the holding period is lower than current carrying value. The impairment charges were principally a result of increases in estimated capitalization rates and deterioration in market conditions that adversely impacted underlying real estate values. Therefore, the impairment charges are not related to the current performance of AMB’s real estate operations and should be excluded from its calculation
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 25 |
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of NOI.
AMB considers SS NOI to be a useful supplemental measure of our operating performance for properties that are considered part of the same store pool. AMB defines Cash-basis SS NOI as NOI on a same store basis excluding straight line rents and amortization of lease intangibles. See definition of “same store pool.” AMB considers SS NOI to be an appropriate and useful supplemental performance measure because it reflects the operating performance of the real estate portfolio excluding effects of non-cash adjustments and provides a better measure of actual cash basis rental growth for a year-over-year comparison. In addition, AMB believes that SS NOI helps investors compare the operating performance of AMB’s real estate as compared to other companies. While SS NOI is a relevant and widely used measure of operating performance of real estate investment trusts, it does not represent cash flow from operations or net income as defined by GAAP and should not be considered as an alternative to those measures in evaluating our liquidity or operating performance. SS NOI also does not reflect general and administrative expenses, interest expenses, real estate impairment losses, depreciation and amortization costs, capital expenditures and leasing costs, or trends in development and construction activities that could materially impact our results from operations. Further, AMB’s computation of SS NOI may not be comparable to that of other real estate companies, as they may use different methodologies for calculating SS NOI.
The following table reconciles consolidated cash-basis SS NOI and NOI from net income for the quarters and years ended December 31, 2009 and 2008 (dollars in thousands):
For the Quarters Ended | For the Years Ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net loss | $ | (10,102 | ) | $ | (199,262 | ) | $ | (27,960 | ) | $ | (6,750 | ) | ||||
Private capital income | (10,503 | ) | (7,632 | ) | (37,879 | ) | (68,470 | ) | ||||||||
Depreciation and amortization | 51,869 | 38,233 | 179,894 | 164,188 | ||||||||||||
Real estate impairment losses | — | 183,754 | 174,410 | 183,754 | ||||||||||||
General and administrative and fund costs | 31,369 | 40,802 | 116,315 | 145,040 | ||||||||||||
Restructuring charges | 2,544 | 12,306 | 6,368 | 12,306 | ||||||||||||
Total other income and expenses | 39,610 | 31,815 | 90,484 | 20,213 | ||||||||||||
Total discontinued operations | (1,753 | ) | 7,277 | (94,725 | ) | (4,558 | ) | |||||||||
NOI | 103,034 | 107,293 | 406,907 | 445,723 | ||||||||||||
Less non same-store NOI | (23,937 | ) | (17,385 | ) | (77,719 | ) | (96,766 | ) | ||||||||
Less non cash adjustments(1) | (1,379 | ) | 1,215 | (398 | ) | (891 | ) | |||||||||
Cash-basis same-store NOI | $ | 77,718 | $ | 91,123 | $ | 328,790 | $ | 348,066 | ||||||||
(1) | Non-cash adjustments include straight line rents and amortization of lease intangibles for the same store pool only. |
Same store NOI growthis the change in the NOI (excluding straight-line rents and amortization of lease intangibles) of the same store pool from the prior year reporting period to the current year reporting period.
Same store poolincludes all properties that are owned as of the end of both the current and prior year reporting periods and excludes development properties for both the current and prior reporting periods. The same store pool is set annually and excludes properties purchased and developments stabilized after December 31, 2007.
Second generation TIs and LCs per square footare total tenant improvements, lease commissions and other leasing costs incurred during leasing of second generation space divided by the total square feet leased. Costs incurred prior to leasing available space are not included until such space is leased. Second generation space excludes newly developed square footage or square footage vacant at acquisition.
Stabilizationis generally defined as properties that are 90% occupied.
Stabilized cap ratesare calculated as cash NOI stabilized to market occupancy (generally 95%) divided by total acquisition cost. The total acquisition cost basis includes the initial purchase price, the effects of marking assumed debt to market, buyer’s due diligence and closing costs, lease intangible adjustments, estimated acquisition capital expenditures, and leasing costs necessary to achieve stabilization.
Tenant retentionis the square footage of all leases rented by existing tenants divided by the square footage of all expiring and rented leases during the reporting period, excluding the square footage of tenants that default or buy-out prior to expiration of their lease, short-term tenants and the square footage of month-to-month leases.
Total market capitalizationis defined by AMB as AMB’s share of total debt plus preferred equity liquidation preferences plus market equity (unless otherwise noted).
Value-added conversion projectsrepresent the repurposing of industrial properties to a higher and better use, including office, residential, retail, research & development or manufacturing. Activities required to prepare the property for conversion to a higher and better use may include such activities as rezoning, redesigning, reconstructing and retenanting. The sales price of the value-added conversion project is generally based on the underlying land value based on its ultimate use and as such, little to no residual value is ascribed to the industrial building(s).
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 26 |
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Contact Name | Title | Phone | E-mail Address | |||
Hamid R. Moghadam | Chairman & Chief Executive Officer | (415) 733-9401 | hmoghadam@amb.com | |||
Thomas S. Olinger | Chief Financial Officer | (415) 733-9405 | tolinger@amb.com | |||
Guy F. Jaquier | President, Europe and Asia; President, Private Capital | (415) 733-9406 | gjaquier@amb.com | |||
Eugene F. Reilly | President, The Americas | (617) 619-9333 | ereilly@amb.com | |||
Tracy A. Ward | Vice President, IR & Corporate Communications | (415) 733-9565 | tward@amb.com |
Corporate Headquarters | Investor Relations | Other Primary Office Locations | ||||||||
AMB Property Corporation | Tel: (415) 394-9000 | Amsterdam | Boston | Chicago | Los Angeles | |||||
Pier 1, Bay 1 | Fax: (415) 394-9001 | México City | Shanghai | Singapore | Tokyo | |||||
San Francisco, CA 94111 | E-mail: ir@amb.com | |||||||||
Tel: (415) 394-9000 | Website: www.amb.com | |||||||||
Fax: (415) 394-9001 |
Overview | Financial Results | Operations | Capital Deployment | Private Capital | Capitalization | NAV | Reporting Definitions | 27 |
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Some of the information included in this report and the presentations to be held in connection therewith contains forward-looking statements, such as those related to reinstatement of fund investor distributions, our investments in co-investment funds, acquisition opportunities and advantages at attractive pricing, stabilization of private market valuations, consummation of acquisitions accretive to company on leverage neutral basis, recovery in fundamentals including rental rates, occupancy, real estate values, and investor/customer interest, FFO generated by increased occupancy, rental rate recovery, lease up of the development portfolio, monetization of land bank and development capability, and the formation of new ventures, pursuit of distressed and strategic acquisitions, consolidations and other situations, utilization of development capacity to recover G&A, our ability to outperform national occupancy rates, implementation of leasing strategies, our ability to maintain leverage targets, cash sources to cover future capital requirements, the consummation of asset sales marketed, under contract or LOI, our plans to retire, extend and refinance debt and maintain fixed charge coverage at certain levels, our opportunities and plans (including those regarding our global positioning and future capital deployment), our projected funds from operations, future assets under management, same store and/or cash net operating income, occupancy and other financial and operational guidance, our capabilities to drive growth, our future performance compared to peers and other market indices, rent growth, industrial and other market, GDP and trade growth, market drivers, trends and forecasts, port opportunities, on-tarmac opportunities, hiring, performance and retention of key personnel, access to resources, leveraging of relationships, continuation and effectiveness of strategic drivers, information regarding our development, value-added conversion, redevelopment and renovation projects (including stabilization or completion dates, square feet at stabilization or completion, sale or contribution dates, yields from such projects, our share of remaining funding, costs and total investment amounts, scope, location and timing of development starts, margins, projected gains and returns, sustainability, profitability, scope and scale of and demand for projects, targeted value-added conversion projects, redevelopment and conversion timelines, entitlement and repositioning potential of land), ability to deliver customer solutions, strength of lender and customer relationships, lease expirations, performance and value-creation of investments and market entry opportunities, real estate valuations, capitalization rates, acquisition capital and volume, scope and build out and monetization potential of land inventory, co-investment venture and other estimated investment capacity, terms of the co-investment ventures, performance, revenues and returns on investment, target leverage, future incentive distribution, asset management, acquisition and other private capital distributions and fees, timing of incentive distributions, private capital demand, launching of additional funds, termination of funds, planned gross capitalization, future balance sheet capacity, ability to maintain credit extensions, our position to maintain a solid financial position and address debt maturities, interest rate changes, transition to open-end funds, and access to secured and non-secured financings, which are made pursuant to the safe-harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results to differ materially from those in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future events. The events or circumstances reflected in forward-looking statements might not occur. You can identify forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “pro forma,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements are necessarily dependent on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We caution you not to place undue reliance on forward-looking statements, which reflect our analysis only and speak only as of the date of this report or the dates indicated in the statements. We assume no obligation to update or supplement forward-looking statements. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: defaults on or non-renewal of leases by tenants or renewal at lower than expected rent or failure to lease at all or on expected terms, decreases in real estate values and impairment losses, our failure to obtain, renew or extend financing or re-financing, risks related to debt and equity security financings (including dilution risk), our failure to divest properties we have contracted to sell or to timely reinvest proceeds from any divestitures, failure to maintain our current credit agency ratings or comply with our debt covenants, international currency and hedging risks, financial market fluctuations, changes in general economic conditions, global trade or in the real estate sector, inflation risks, a downturn in the U.S., California or global economy, increased interest rates and operating costs or greater than expected capital expenditures, risks related to suspending, reducing, or changing our dividends, our failure to contribute properties to our co-investment ventures, risks related to our obligations in the event of certain defaults under co-investment ventures and other debt, difficulties in identifying properties to acquire and in effecting acquisitions, our failure to successfully integrate acquired properties and operations, risks and uncertainties affecting property development, value-added conversions, redevelopment and construction (including construction delays, cost overruns, our inability to obtain necessary permits and public opposition to these activities), our failure to qualify and maintain our status as a real estate investment trust, risks related to our tax structuring, environmental uncertainties, risks related to natural disasters, changes in real estate and zoning laws, risks related to doing business internationally and global expansion, risks of opening offices globally, risks of changing personnel and roles, losses in excess of our insurance coverage, unknown liabilities acquired in connection with acquired properties or otherwise and increases in real property tax rates. Our success also depends upon economic trends generally, including interest rates, income tax laws, governmental regulation, legislation, population changes and certain other matters discussed under the heading “Risk Factors” and elsewhere in our annual report on Form 10-K for the year ended December 31, 2008 and our quarterly reports on Form 10-Q for the quarters ended March 31, 2009, June 30, 2009 and September 30, 2009.