Exhibit 99.2
Bluerock Residential Growth REIT, Inc.
Fourth Quarter 2019
Supplemental Financial Information
(Unaudited)
| Table of Contents |
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| Fourth Quarter Earnings Release | 3 |
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| Financial and Operating Highlights | 17 |
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| Share and Unit Information | 18 |
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| EBITDAre and Interest Information | 19 |
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| Financial Statistics | 20 |
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| Recent Acquisitions and Investments | 21 |
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| Recent Dispositions | 22 |
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| Investments in Unconsolidated Real Estate Joint Ventures and Notes and Accrued Interest Receivable from Related Parties | 23 |
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| Portfolio Information | 24 |
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| Renovation Table | 25 |
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| Lease-up and Development Mezzanine/Preferred Investments | 26 |
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| Condensed Consolidated Balance Sheets | 27 |
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| Consolidated Statements of Operations | 28 |
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| Reconciliation of Funds from Operations (FFO) and Core Funds from Operations (CFFO) | 29 |
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| Mortgages Payable Summary Information | 30 |
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| 2020 Projected Guidance | 32 |
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| Definitions of Non-GAAP Financial Measures | 33 |
This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are based upon the Company’s present expectations, but these statements are not guaranteed to occur, including statements relating to the Company’s operating environment, operating trends, and outlook. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward-looking statements. For further discussion of the factors that could affect outcomes, please refer to the “Risk Factors” set forth in Item 1A of the Company’s Annual Report on Form 10-K filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) on February 27, 2019, and subsequent filings by the Company with the SEC, including our periodic reports. We claim the safe harbor protection for forward looking statements contained in the Private Securities Litigation Reform Act of 1995.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
For Immediate Release
Bluerock Residential Growth REIT Announces Fourth Quarter 2019 Results
- Total Fourth Quarter Revenues Grew 5.0% to $52.5 Million -
- Full Year 2019 Same Store Revenue Grew 4.8% -
New York, NY (February 13, 2020) – Bluerock Residential Growth REIT, Inc. (NYSE American: BRG) (“the Company”), an owner of highly amenitized multi-family apartment communities, announced today its financial results for the quarter ended December 31, 2019.
Fourth Quarter Highlights
| | • | Total revenues grew 5.0% to $52.5 million for the quarter from $50.0 million in the prior year period. |
| | • | Net loss attributable to common stockholders for the fourth quarter of 2019 was ($0.62) per diluted share, as compared to net loss attributable to common stockholders of ($0.55) per diluted share in the prior year period. |
| | • | Property Net Operating Income (“NOI”) grew 5.2% to $28.2 million from $26.8 million in the prior year period. |
| | • | Same store revenue increased 2.4% and same store NOI decreased 0.2%, as compared to the prior year period due to one-time events detailed below. Full year same store revenue and NOI increased 4.8% and 5.8%, respectively. |
| | • | Completed 211 value-add unit upgrades during the quarter producing a 19.3% ROI through increased monthly rental rates. |
| | • | Improved operating margin by 110 basis points year over year to 61.6%. |
| | • | Core funds from operations attributable to common stockholders and unit holders (“CFFO”) was $6.7 million, compared to $6.3 million in the prior year period. CFFO per diluted share was $0.21 for the quarter as compared to $0.20 in fourth quarter 2018. |
| | • | Invested in three multifamily communities totaling 866 units for a total purchase price of $222 million. |
| | • | Invested $48 million in debt and preferred equity investments, including three multifamily communities totaling 481 units in Atlanta and Smyrna, Georgia and additional fundings of seven development projects. |
| | • | Paid quarterly common stock dividend of $0.1625, a 77% payout on a CFFO basis. |
| | • | Terminated the Series B Preferred Stock offering, and initiated sales of Series T preferred stock in December 2019. |
| | • | Consolidated real estate investments, at cost, increased approximately $286 million to $2.1 billion, from December 31, 2018. |
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Full Year 2019 Highlights
| | · | Total revenues grew 13.7% to $210.0 million for the year from $184.7 million in the prior year. |
| | · | Net loss attributable to common stockholders for 2019 was ($0.91) per share, as compared to ($1.82) per share in the prior year. |
| | · | Property NOI grew 17.4% to $110.9 million, from $94.5 million in the prior year. |
| | · | Same store revenue and NOI increased 4.8% and 5.8%, respectively, as compared to the prior year. |
| | · | Completed 979 value-add unit upgrades during the year producing a 22.7% ROI through increased monthly rental rates. |
| | · | Improved operating margin by 170 basis points year over year to 59.8%. |
| | · | CFFO increased 2.6% to $25.4 million, from $24.8 million in the prior year. CFFO per share increased 2.5% to $0.82 for the year from $0.80 in the prior year. |
| | · | For the full year, the Company made investments in seven multifamily communities with 2,365 total units for a total purchase price of $526 million. |
| | · | Completed the sale of eight assets during 2019, totaling approximately $370 million. |
| | · | Invested $94 million in debt and preferred equity investments, including five operating multifamily communities totaling 785 units, one development community, and additional fundings of eleven development projects. |
| | · | Invested $10 million to buyout the noncontrolling interests in three assets. |
“The fourth quarter topped a productive year for BRG, as we delivered same-store NOI growth of 5.8% for the year, and completed over $629 million of investments to fuel our ongoing growth. This included an active fourth quarter where we acquired three operating assets and invested in three preferred equity investments,” said Ramin Kamfar, Chairman and CEO. “We continued to target growth markets and expanded our geographic footprint in the West with acquisitions in Arizona and Washington. We are excited about the growth we anticipate as 2020 progresses and we realize the benefits of our recent acquisitions and proven value-add upgrade program.”
Financial Results
Net loss attributable to common stockholders for the fourth quarter of 2019 was ($13.8) million, or ($0.62) per diluted share, compared to a net loss attributable to common stockholders of ($12.8) million, or ($0.55) per diluted share, in the prior year period. Net income attributable to common stockholders included non-cash expenses of $18.6 million, or $0.83 per share in the fourth quarter of 2019 compared to non-cash expenses of $17.7 million or $0.75 per share for the prior year period.
CFFO for the fourth quarter of 2019 was $6.7 million, or $0.21 per diluted share, compared to $6.3 million, or $0.20 per diluted share, in the prior year period. CFFO was primarily driven by growth in property NOI of $1.4 million, interest income of $1.0 million, preferred returns on unconsolidated real estate of $0.2 million arising from investment activity and decreases of $0.7 million and $0.3 million in cash general and administrative expenses and interest expense, respectively. This was primarily offset by a year-over-year rise in preferred stock dividends of $3.2 million.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Total Portfolio Performance
| $ In thousands, except average rental rates | | 4Q19 | | | 4Q18 | | | Variance | | | YTD19 | | | YTD18 | | | Variance | |
| Total Revenues(1) | | $ | 52,520 | | | $ | 50,011 | | | | 5.0 | % | | $ | 209,971 | | | $ | 184,716 | | | | 13.7 | % |
| Property Operating Expenses | | $ | 17,600 | | | $ | 17,493 | | | | 0.6 | % | | $ | 74,449 | | | $ | 67,997 | | | | 9.5 | % |
| NOI | | $ | 28,200 | | | $ | 26,795 | | | | 5.2 | % | | $ | 110,927 | | | $ | 94,464 | | | | 17.4 | % |
| Operating Margin | | | 61.6 | % | | | 60.5 | % | | | 110 | bps | | | 59.8 | % | | | 58.1 | % | | | 170 | bps |
| Occupancy Percentage | | | 93.6 | % | | | 94.5 | % | | | (90 | )bps | | | 93.8 | % | | | 94.1 | % | | | (30 | )bps |
| Average Rental Rate | | $ | 1,319 | | | $ | 1,280 | | | | 3.0 | % | | $ | 1,311 | | | $ | 1,251 | | | | 4.8 | % |
| | (1) | Including interest income from related parties |
For the fourth quarter of 2019, property revenues increased by 5.0% compared to the same prior year period primarily attributable to the increased size of the portfolio. Total portfolio NOI was $28.2 million, an increase of $1.4 million, or 5.2%, compared to the same period in the prior year.
Property NOI margins were 61.6% of revenue for the quarter, an increase of 110 basis points compared to 60.5% of revenue in the prior year quarter. Property operating expenses were up primarily due to non-controllable expenses increases.
Same Store Portfolio Performance
| $ In thousands, except average rental rates | | 4Q19 | | | 4Q18 | | | Variance | | | YTD19 | | | YTD18 | | | Variance | |
| Revenues | | $ | 36,319 | | | $ | 35,472 | | | | 2.4 | % | | $ | 126,568 | | | $ | 120,770 | | | | 4.8 | % |
| Property Operating Expenses | | $ | 14,569 | | | $ | 13,681 | | | | 6.5 | % | | $ | 51,012 | | | $ | 49,340 | | | | 3.4 | % |
| NOI | | $ | 21,750 | | | $ | 21,791 | | | | (0.2 | %) | | $ | 75,556 | | | $ | 71,430 | | | | 5.8 | % |
| Operating Margin | | | 59.9 | % | | | 61.4 | % | | | (150 | )bps | | | 59.7 | % | | | 59.1 | % | | | 60 | bps |
| Occupancy Percentage | | | 93.6 | % | | | 94.8 | % | | | (120 | )bps | | | 94.1 | % | | | 94.3 | % | | | (20 | )bps |
| Average Rental Rate | | $ | 1,324 | | | $ | 1,278 | | | | 3.6 | % | | $ | 1,320 | | | $ | 1,255 | | | | 5.2 | % |
Same store NOI for the three months ended December 31, 2019 decreased 0.2%, or $0.04 million, compared to the 2018 period. Same store property revenues increased 2.4% as compared to the 2018 period, primarily driven by a 3.6% increase in average rental rates as twenty-four of our twenty-six same store properties recognized rental rate increases during the period. Revenues were moderated by a 120 basis points decrease in average occupancy to 93.6% primarily due to a loss of 27 corporate leases in one asset, and the transition of property management at three assets necessitated by performance issues. Occupancy at the above assets have recovered to 96.2% as of end of January 2020.
Same store expenses for the three months ended December 31, 2019 increased 6.5%, or $0.9 million, compared to the 2018 period, primarily due to non-controllable expense increases. Real estate taxes increased $0.6 million from prior year due to $0.3 million in municipality tax increases and to a $0.3 million real estate tax income item recognized in the prior year. In addition, insurance expenses increased $0.2 million due to industrywide price increases stemming from hurricanes, wildfires, and hail over the past two years.
Renovation Activity
The Company completed 211 value-add unit upgrades during the fourth quarter producing a 19.3% ROI through increased monthly rental rates. The Company completed 979-unit renovations in 2019 producing a 22.7% ROI through increased monthly rental rates.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Since inception, within the existing portfolio, the Company has completed 2,645 value-add unit upgrades at an average cost of $5,682 per unit and achieved an average monthly rental rate increase of $111 per unit, equating to a 23.5% ROI on all unit upgrades leased as of December 31, 2019. The Company has identified approximately 4,515 remaining units within the existing portfolio for value-add upgrades with similar projected economics to the completed renovations.
Portfolio Activity
During the fourth quarter, the Company completed investments totaling $270 million. These investments include the following:
| | • | Funded $26 million in increased development loans related to The Park at Chapel Hill, a development located in Chapel Hill, North Carolina. |
| | • | Acquired a 90% interest in a 358-unit apartment community located in Atlanta, Georgia, known as Chattahoochee Ridge. The total purchase price was $70 million, funded in part by a $45 million mortgage loan secured by the property. |
| | • | Invested $4 million to increase its interest in the Helios development in Atlanta, Georgia. |
| | • | Acquired a 100% interest in a 332-unit apartment community located in Scottsdale, Arizona, known as The District at Scottsdale. The total purchase price was approximately $124 million, funded in part by a $82 million mortgage loan secured by the property. The asset was 60% leased at purchase, as a result of which the Company realized a 50 to 75 basis point cap rate benefit on its purchase price. |
| | • | Acquired a 90% interest in a 176-unit apartment community located in Pasco, Washington, known as Navigator Villas. The total purchase price was approximately $28 million, funded in part by the assumption of a $15 million mortgage loan secured by the property, along with a $6 million supplemental mortgage loan. The Company believes this community has significant value-add renovation upside opportunity. |
| | • | Made preferred equity investments totaling $10 million into three Atlanta, Georgia MSA operating assets with 481-units called Belmont Crossing, Sierra Terrace, and Sierra Village. |
| | • | Funded $8 million under existing preferred and mezzanine commitments in five developments. |
| | • | In addition, contributed its remaining mezzanine loan of $10 million to Cade Boca Raton for an 81.0% interest in the Cade Boca Raton development. |
| | • | Subsequent to year-end, acquired a 100% interest in a 254-unit apartment community in Phoenix, Arizona known as Avenue 25 for a total purchase price of $56 million. The asset offers significant operational upside through institutional property management and substantial value-add opportunity. |
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Balance Sheet
During the fourth quarter, the Company raised gross proceeds of approximately $84.3 million through the issuance of 84,293 shares of Series B Preferred Stock with associated warrants at $1,000 per unit. The Company terminated the offering of Series B Preferred Stock and warrants effective December 20, 2019.
The Company initiated sales of the Series T Preferred Stock in December 2019 and issued 17,400 Series T Preferred shares with gross proceeds of $0.4 million. The Series T Preferred Stock continuous offering offers 20,000,000 preferred shares in the primary offering, along with 12,000,000 preferred shares pursuant to a dividend reinvestment plan. The preferred shares are offered at $25.00 per share and pay cumulative monthly dividends at a 6.15% annual rate, along with an annual stock dividend of up to 0.2% annually for five years.
The Company initiated redemptions of its Series B Preferred Stock during November 2019. The Company redeemed 7,300 shares of Series B Preferred Stock representing a stated value of $7.3 million plus accrued and unpaid dividends by issuing 613,153 shares of Class A common stock.
The Company repurchased 57,883 shares of its Class A common stock at an average price of $11.79 per share, for a total cost of approximately $0.7 million under its $50.0 million share repurchase plan announced in December 2019.
The Company sold 454,237 shares of its Class A common stock at an average price of $11.98 per share, for total proceeds of approximately $5.4 million under its Class A common stock ATM (“At-the-Market”) offering announced in September 2019.
As of December 31, 2019, the Company had $31.7 million of unrestricted cash on its balance sheet, approximately $83.0 million available among its revolving credit facilities, and $1.4 billion of debt outstanding.
Dividend
The Board of Directors authorized, and the Company declared, a quarterly dividend for the fourth quarter of 2019 equal to a quarterly rate of $0.1625 per share on its Class A common stock, payable to the stockholders of record as of December 24, 2019, which was paid in cash on January 3, 2020. A portion of each dividend may constitute a return of capital for tax purposes. There is no assurance that the Company will continue to declare dividends or at this rate.
The Board of Directors authorized, and the Company declared, a quarterly cash dividend on its 8.250% Series A Cumulative Redeemable Preferred Stock for the fourth quarter of 2019, in the amount of $0.515625 per share. In addition, the Board of Directors authorized, and the Company declared, a quarterly cash dividend on its 7.625% Series C Cumulative Redeemable Preferred Stock for the fourth quarter of 2019, in the amount of $0.4765625 per share. Further, the Board of Directors authorized, and the Company declared, a quarterly cash dividend on its 7.125% Series D Cumulative Preferred Stock for the fourth quarter of 2019, in the amount of $0.4453125 per share. The dividends were payable to the stockholders of record on December 24, 2019 and were paid in cash on January 3, 2020.
On October 14, 2019, the Board of Directors authorized, and the Company declared, a monthly dividend of $5.00 per share of Series B Preferred Stock, payable to the stockholders of record as of October 25, 2019, which was paid in cash on November 5, 2019. On October 31, 2019, the Board of Directors authorized, and the Company declared, monthly dividends of $5.00 per share, each prorated on the basis of the actual number of days in the applicable dividend period during which each such share was outstanding. Such prorated dividends were paid in cash on each of (i) December 5, 2019 (to holders of record on November 25, 2019), and (ii) January 3, 2020 (to holders of record on December 24, 2019).
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
On December 20, 2019, the Board of Directors authorized, and the Company declared a monthly dividend of $0.128125 per share of Series T Preferred Stock, prorated on the basis of the actual number of days in the applicable dividend period during which each share was outstanding. Such pro-rated dividends were payable to the stockholders of record on December 24, 2019 and were paid in cash on January 3, 2020.
2020 Guidance
Based on the Company’s current outlook and market conditions, the Company anticipates 2020 CFFO in the range of $0.83 to $0.86 per share. The Company anticipates that earnings growth will be more heavily weighted towards the second half of 2020 as it realizes the upside opportunity from implementation of institutional property management, lease-ups, and value-add renovations at its recent acquisitions. For additional guidance details underlying earnings guidance, please see page 32 of Company’s Fourth Quarter 2019 Earnings Supplement available under Investors on the Company’s website (www.bluerockresidential.com).
Conference Call
All interested parties can listen to the live conference call at 11:00 AM ET on Thursday, February 13, 2020 by dialing +1 (866) 843-0890 within the U.S., or +1 (412) 317-6597, and requesting the "Bluerock Residential Conference."
For those who are not available to listen to the live call, the conference call will be available for replay on the Company’s website two hours after the call concludes, and will remain available until March 13, 2020 athttp://services.choruscall.com/links/brg200213.html, as well as by dialing +1 (877) 344-7529 in the U.S., or +1 (412) 317-0088 internationally, and requesting conference number 10138317.
The full text of this Earnings Release and additional Supplemental Information is available in the Investors section on the Company’s website athttp://www.bluerockresidential.com.
About Bluerock Residential Growth REIT, Inc.
Bluerock Residential Growth REIT, Inc. (NYSE American: BRG) is a real estate investment trust that focuses on developing and acquiring a diversified portfolio of institutional-quality highly amenitized live/work/play apartment communities in demographically attractive knowledge economy growth markets to appeal to the renter by choice. The Company’s objective is to generate value through off-market/relationship-based transactions and, at the asset level, through value add improvements to properties and operations. The Company is included in the Russell 2000 and Russell 3000 Indexes. BRG has elected to be taxed as a real estate investment trust (REIT) for U.S. federal income tax purposes.
For more information, please visit the Company’s website atwww.bluerockresidential.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are based upon the Company’s present expectations, but these statements are not guaranteed to occur. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward-looking statements. For further discussion of the factors that could affect outcomes, please refer to the risk factors set forth in Item 1A of the Company’s Annual Report on Form 10-K filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) on February 27, 2019, and subsequent filings by the Company with the SEC. We claim the safe harbor protection for forward looking statements contained in the Private Securities Litigation Reform Act of 1995.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Portfolio Summary
The following is a summary of our operating real estate and mezzanine/preferred investments as of December 31, 2019:
| Consolidated Operating Properties | | Location | | Number of Units | | | Year Built/
Renovated(1) | | | Ownership Interest | | | Average Rent(2) | | | % Occupied(3) | |
| ARIUM Glenridge | | Atlanta, GA | | | 480 | | | | 1990 | | | | 90 | % | | $ | 1,262 | | | | 92.9 | % |
| ARIUM Grandewood | | Orlando, FL | | | 306 | | | | 2005 | | | | 100 | % | | | 1,435 | | | | 94.1 | % |
| ARIUM Hunter’s Creek | | Orlando, FL | | | 532 | | | | 1999 | | | | 100 | % | | | 1,445 | | | | 94.7 | % |
| ARIUM Metrowest | | Orlando, FL | | | 510 | | | | 2001 | | | | 100 | % | | | 1,418 | | | | 93.5 | % |
| ARIUM Westside | | Atlanta, GA | | | 336 | | | | 2008 | | | | 90 | % | | | 1,571 | | | | 97.0 | % |
| Ashford Belmar | | Lakewood, CO | | | 512 | | | | 1988/1993 | | | | 85 | % | | | 1,658 | | | | 91.8 | % |
| Ashton Reserve | | Charlotte, NC | | | 473 | | | | 2015 | | | | 100 | % | | | 1,125 | | | | 95.8 | % |
| Cade Boca Raton | | Boca Raton, FL | | | 90 | | | | 2019 | | | | 81 | % | | | 2,639 | | | | 92.2 | % |
| Chattahoochee Ridge | | Atlanta, GA | | | 358 | | | | 1996 | | | | 90 | % | | | 1,370 | | | | 91.3 | % |
| Citrus Tower | | Orlando, FL | | | 336 | | | | 2006 | | | | 97 | % | | | 1,328 | | | | 92.6 | % |
| Denim | | Scottsdale, AZ | | | 645 | | | | 1979 | | | | 100 | % | | | 1,177 | | | | 97.2 | % |
| Element | | Las Vegas, NV | | | 200 | | | | 1995 | | | | 100 | % | | | 1,259 | | | | 94.5 | % |
| Enders Place at Baldwin Park | | Orlando, FL | | | 220 | | | | 2003 | | | | 92 | % | | | 1,799 | | | | 96.4 | % |
| Gulfshore Apartment Homes, formerly ARIUM Gulfshore | | Naples, FL | | | 368 | | | | 2016 | | | | 100 | % | | | 1,316 | | | | 92.9 | % |
| James on South First | | Austin, TX | | | 250 | | | | 2016 | | | | 90 | % | | | 1,325 | | | | 94.0 | % |
| Marquis at The Cascades | | Tyler, TX | | | 582 | | | | 2009 | | | | 90 | % | | | 1,238 | | | | 93.8 | % |
| Marquis at TPC | | San Antonio, TX | | | 139 | | | | 2008 | | | | 90 | % | | | 1,494 | | | | 97.1 | % |
| Navigator Villas | | Pasco, WA | | | 176 | | | | 2013 | | | | 90 | % | | | 1,087 | | | | 95.5 | % |
| Outlook at Greystone | | Birmingham, AL | | | 300 | | | | 2007 | | | | 100 | % | | | 1,018 | | | | 95.3 | % |
| Park & Kingston | | Charlotte, NC | | | 168 | | | | 2015 | | | | 100 | % | | | 1,331 | | | | 94.6 | % |
| Pine Lakes Preserve, formerly ARIUM Pine Lakes | | Port St. Lucie, FL | | | 320 | | | | 2003 | | | | 100 | % | | | 1,333 | | | | 94.7 | % |
| Plantation Park | | Lake Jackson, TX | | | 238 | | | | 2016 | | | | 80 | % | | | 1,362 | | | | 91.6 | % |
| Providence Trail | | Mount Juliet, TN | | | 334 | | | | 2007 | | | | 100 | % | | | 1,256 | | | | 91.0 | % |
| Roswell City Walk | | Roswell, GA | | | 320 | | | | 2015 | | | | 98 | % | | | 1,549 | | | | 94.4 | % |
| Sands Parc | | Daytona Beach, FL | | | 264 | | | | 2017 | | | | 100 | % | | | 1,374 | | | | 94.7 | % |
| The Brodie | | Austin, TX | | | 324 | | | | 2001 | | | | 93 | % | | | 1,321 | | | | 96.0 | % |
| The District at Scottsdale | | Scottsdale, AZ | | | 332 | | | | 2018 | | | | 100 | % | | | 2,161 | | | | 61.1 | % |
| The Links at Plum Creek | | Castle Rock, CO | | | 264 | | | | 2000 | | | | 88 | % | | | 1,456 | | | | 90.9 | % |
| The Mills | | Greenville, SC | | | 304 | | | | 2013 | | | | 100 | % | | | 1,071 | | | | 93.4 | % |
| The Preserve at Henderson Beach | | Destin, FL | | | 340 | | | | 2009 | | | | 100 | % | | | 1,474 | | | | 93.5 | % |
| The Reserve at Palmer Ranch, formerly ARIUM at Palmer Ranch | | Sarasota, FL | | | 320 | | | | 2016 | | | | 100 | % | | | 1,305 | | | | 96.9 | % |
| The Sanctuary | | Las Vegas, NV | | | 320 | | | | 1988 | | | | 100 | % | | | 1,026 | | | | 89.4 | % |
| Veranda at Centerfield | | Houston, TX | | | 400 | | | | 1999 | | | | 93 | % | | | 981 | | | | 96.3 | % |
| Villages at Cypress Creek | | Houston, TX | | | 384 | | | | 2001 | | | | 80 | % | | | 1,155 | | | | 93.8 | % |
| Wesley Village | | Charlotte, NC | | | 301 | | | | 2010 | | | | 100 | % | | | 1,372 | | | | 92.4 | % |
| Consolidated Operating Properties Subtotal/Average | | | | | 11,746 | | | | | | | | | | | $ | 1,319 | (4) | | | 94.0 | %(4) |
| | | | | | | | | | | | | | | | | | | | | | | |
| Mezzanine/Preferred Investments | | Location | | Actual/Planned Number of Units | | | | | | | | | | | Pro Forma Average Rent | | | | | |
| Alexan CityCentre | | Houston, TX | | | 340 | | | | | | | | | | | $ | 1,721 | (2) | | | | |
| Alexan Southside Place | | Houston, TX | | | 270 | | | | | | | | | | | | 1,710 | (2) | | | | |
| Arlo | | Charlotte, NC | | | 286 | | | | | | | | | | | | 1,507 | | | | | |
| Belmont Crossing | | Smyrna, GA | | | 192 | | | | | | | | | | | | 789 | (2) | | | | |
| Domain at The One Forty | | Garland, TX | | | 299 | | | | | | | | | | | | 1,469 | | | | | |
| Helios | | Atlanta, GA | | | 282 | | | | | | | | | | | | 1,443 | (2) | | | | |
| Mira Vista | | Austin, TX | | | 200 | | | | | | | | | | | | 977 | (2) | | | | |
| Motif, formerly Flagler Village | | Fort Lauderdale, FL | | | 385 | | | | | | | | | | | | 2,352 | | | | | |
| North Creek Apartments | | Leander, TX | | | 259 | | | | | | | | | | | | 1,358 | | | | | |
| Novel Perimeter | | Atlanta, GA | | | 320 | | | | | | | | | | | | 1,749 | | | | | |
| Riverside Apartments | | Austin, TX | | | 222 | | | | | | | | | | | | 1,408 | | | | | |
| Sierra Terrace | | Atlanta, GA | | | 135 | | | | | | | | | | | | 1,159 | (2) | | | | |
| Sierra Village | | Atlanta, GA | | | 154 | | | | | | | | | | | | 1,073 | (2) | | | | |
| The Park at Chapel Hill | | Chapel Hill, NC | | | * | | | | | | | | | | | | * | | | | | |
| Thornton Flats | | Austin, TX | | | 104 | | | | | | | | | | | | 1,551 | (2) | | | | |
| Vickers Historic Roswell | | Roswell, GA | | | 79 | | | | | | | | | | | | 3,176 | | | | | |
| Wayforth at Concord | | Concord, NC | | | 150 | | | | | | | | | | | | 1,707 | | | | | |
| Whetstone Apartments | | Durham, NC | | | 204 | | | | | | | | | | | | 1,327 | (2) | | | | |
| Mezzanine and Preferred Investments Subtotal/Average | | | | | 3,881 | | | | | | | | | | | $ | 1,631 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Portfolio Properties Total/Average | | | | | 15,627 | | | | | | | | | | | $ | 1,394 | (4) | | | | |
(1) Represents date of last significant renovation or year built if no renovations.
(2) Represents the average effective monthly rent per occupied unit for the three months ended December 31, 2019.
(3) Percent occupied is calculated as (i) the number of units occupied as of December 31, 2019, divided by (ii) total number of units, expressed as a percentage.
(4) Excludes District at Scottsdale, which is in lease-up and Cade Boca Raton, which was consolidated on December 31, 2019 and had no operations for the quarter.
* The development is in the planning phase, project specifications are in process.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Consolidated Statement of Operations
For the Three and Nine Months Ended December 31, 2019 and 2018
(Unaudited and dollars in thousands except for share and per share data)
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Revenues | | | | | | | | | | | | | | | | |
| Net rental income | | $ | 40,565 | | | $ | 39,534 | | | $ | 164,498 | | | $ | 144,325 | |
| Other property revenues | | | 5,235 | | | | 4,754 | | | | 20,878 | | | | 18,136 | |
| Rental and other property revenues | | | 45,800 | | | | 44,288 | | | | 185,376 | | | | 162,461 | |
| Interest income from related parties | | | 6,720 | | | | 5,723 | | | | 24,595 | | | | 22,255 | |
| Total revenues | | | 52,520 | | | | 50,011 | | | | 209,971 | | | | 184,716 | |
| Expenses | | | | | | | | | | | | | | | | |
| Property operating | | | 17,600 | | | | 17,493 | | | | 74,449 | | | | 67,997 | |
| Property management fees | | | 1,192 | | | | 1,184 | | | | 4,899 | | | | 4,391 | |
| General and administrative | | | 5,620 | | | | 5,623 | | | | 22,553 | | | | 19,553 | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Weather-related losses, net | | | 7 | | | | 107 | | | | 355 | | | | 288 | |
| Depreciation and amortization | | | 19,355 | | | | 16,839 | | | | 70,452 | | | | 62,683 | |
| Total expenses | | | 43,984 | | | | 41,283 | | | | 173,264 | | | | 155,028 | |
| Operating income | | | 8,536 | | | | 8,728 | | | | 36,707 | | | | 29,688 | |
| Other income (expense) | | | | | | | | | | | | | | | | |
| Other income | | | 68 | | | | — | | | | 68 | | | | — | |
| Preferred returns on unconsolidated real estate joint ventures | | | 2,700 | | | | 2,435 | | | | 9,797 | | | | 10,312 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | 48,680 | | | | — | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | 679 | | | | — | |
| Loss on extinguishment of debt and debt modification costs | | | (335 | ) | | | — | | | | (7,258 | ) | | | (2,277 | ) |
| Interest expense, net | | | (13,728 | ) | | | (16,935 | ) | | | (59,554 | ) | | | (52,998 | ) |
| Total other (expense) income | | | (11,295 | ) | | | (14,500 | ) | | | (7,588 | ) | | | (44,963 | ) |
| Net (loss) income | | | (2,759 | ) | | | (5,772 | ) | | | 29,119 | | | | (15,275 | ) |
| Preferred stock dividends | | | (12,868 | ) | | | (9,642 | ) | | | (46,159 | ) | | | (35,637 | ) |
| Preferred stock accretion | | | (3,415 | ) | | | (1,829 | ) | | | (10,335 | ) | | | (5,970 | ) |
| Net loss attributable to noncontrolling interests | | | | | | | | | | | | | | | | |
| Operating Partnership units | | | (5,032 | ) | | | (3,998 | ) | | | (6,779 | ) | | | (12,839 | ) |
| Partially owned properties | | | (183 | ) | | | (460 | ) | | | (845 | ) | | | (1,284 | ) |
| Net loss attributable to noncontrolling interests | | | (5,215 | ) | | | (4,458 | ) | | | (7,624 | ) | | | (14,123 | ) |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| | | | | | | | | | | | | | | | | |
| Net loss per common share - Basic | | $ | (0.62 | ) | | $ | (0.55 | ) | | $ | (0.91 | ) | | $ | (1.82 | ) |
| | | | | | | | | | | | | | | | | |
| Net loss per common share – Diluted | | $ | (0.62 | ) | | $ | (0.55 | ) | | $ | (0.91 | ) | | $ | (1.82 | ) |
| | | | | | | | | | | | | | | | | |
| Weighted average basic common shares outstanding | | | 22,729,882 | | | | 23,702,897 | | | | 22,649,222 | | | | 23,845,800 | |
| Weighted average diluted common shares outstanding | | | 22,729,882 | | | | 23,702,897 | | | | 22,649,222 | | | | 23,845,800 | |
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Consolidated Balance Sheets
Fourth Quarter 2019
(Unaudited and dollars in thousands except for share and per share amounts)
| | | December 31,
2019 | | | December 31,
2018 | |
| ASSETS | | | | | | | | |
| Net Real Estate Investments | | | | | | | | |
| Land | | $ | 268,244 | | | $ | 200,385 | |
| Buildings and improvements | | | 1,752,738 | | | | 1,546,244 | |
| Furniture, fixtures and equipment | | | 67,836 | | | | 55,050 | |
| Construction in progress | | | 68 | | | | 989 | |
| Total Gross Real Estate Investments | | | 2,088,886 | | | | 1,802,668 | |
| Accumulated depreciation | | | (141,566 | ) | | | (108,911 | ) |
| Total Net Real Estate Investments | | | 1,947,320 | | | | 1,693,757 | |
| Cash and cash equivalents | | | 31,683 | | | | 24,775 | |
| Restricted cash | | | 19,085 | | | | 27,469 | |
| Notes and accrued interest receivable from related parties | | | 193,781 | | | | 164,084 | |
| Due from affiliates | | | 4,077 | | | | 2,854 | |
| Accounts receivable, prepaids and other assets | | | 15,209 | | | | 14,395 | |
| Preferred equity investments and investments in unconsolidated real estate joint ventures | | | 126,444 | | | | 89,033 | |
| In-place lease intangible assets, net | | | 3,098 | | | | 1,768 | |
| TOTAL ASSETS | | $ | 2,340,697 | | | $ | 2,018,135 | |
| | | | | | | | | |
| LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY | | | | | | | | |
| Mortgages payable | | $ | 1,425,257 | | | $ | 1,206,136 | |
| Revolving credit facilities | | | 18,000 | | | | 82,209 | |
| Accounts payable | | | 1,488 | | | | 1,486 | |
| Other accrued liabilities | | | 27,499 | | | | 31,690 | |
| Due to affiliates | | | 790 | | | | 726 | |
| Distributions payable | | | 13,541 | | | | 12,073 | |
| Total Liabilities | | | 1,486,575 | | | | 1,334,320 | |
| 8.250% Series A Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 10,875,000 shares authorized; 5,721,460 shares issued and outstanding at December 31, 2019 and 2018 | | | 140,355 | | | | 139,545 | |
| 6.000% Series B Redeemable Preferred Stock, liquidation preference $1,000 per share, 1,225,000 shares authorized; 536,695 and 306,009 shares issued and outstanding as of December 31, 2019 and 2018, respectively | | | 480,921 | | | | 272,842 | |
| 7.625% Series C Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,323,750 shares issued and outstanding as of December 31, 2019 and 2018 | | | 56,797 | | | | 56,485 | |
| 6.150% Series T Redeemable Preferred Stock, liquidation preference $25.00 per share, 32,000,000 shares authorized; 17,400 and no shares issued and outstanding as of December 31, 2019 and 2018, respectively | | | 388 | | | | — | |
| Equity | | | | | | | | |
| Stockholders’ Equity | | | | | | | | |
| Preferred stock, $0.01 par value, 197,900,000 shares authorized; no shares issued and outstanding as of December 31, 2019 and 2018 | | | — | | | | — | |
| 7.125% Series D Cumulative Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,850,602 shares issued and outstanding at December 31, 2019 and 2018 | | | 68,705 | | | | 68,705 | |
| Common stock - Class A, $0.01 par value, 747,509,582 shares authorized; 23,422,557 and 23,322,211 shares issued and outstanding as of December 31, 2019 and 2018, respectively | | | 234 | | | | 233 | |
| Common stock - Class C, $0.01 par value, 76,603 shares authorized; 76,603 shares issued and outstanding as of December 31, 2019 and 2018 | | | 1 | | | | 1 | |
| Additional paid-in-capital | | | 311,683 | | | | 307,938 | |
| Distributions in excess of cumulative earnings | | | (253,132 | ) | | | (218,531 | ) |
| Total Stockholders’ Equity | | | 127,491 | | | | 158,346 | |
| Noncontrolling Interests | | | | | | | | |
| Operating partnership units | | | 19,331 | | | | 27,613 | |
| Partially owned properties | | | 28,839 | | | | 28,984 | |
| Total Noncontrolling Interests | | | 48,170 | | | | 56,597 | |
| Total Equity | | | 175,661 | | | | 214,943 | |
| TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY | | $ | 2,340,697 | | | $ | 2,018,135 | |
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Non-GAAP Financial Measures
The foregoing supplemental financial data includes certain non-GAAP financial measures that we believe are helpful in understanding our business and performance, as further described below. Our definition and calculation of these non-GAAP financial measures may differ from those of other REITs, and may, therefore, not be comparable.
Funds from Operations and Core Funds from Operations Attributable to Common Stockholders and Unit Holders
We believe that funds from operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts (“NAREIT”), and core funds from operations (“CFFO) are important non-GAAP supplemental measures of operating performance for a REIT.
FFO attributable to common stockholders and unit holders is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We consider FFO to be an appropriate supplemental measure of our operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. We define FFO, consistent with the NAREIT definition, as net income, computed in accordance with GAAP, excluding gains or losses on sales of depreciable real estate property, plus depreciation and amortization of real estate assets, plus impairment write-downs of depreciable real estate, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis.
CFFO makes certain adjustments to FFO, removing the effect of items that do not reflect ongoing property operations such as acquisition expenses, non-cash interest, unrealized gains or losses on derivatives, losses on extinguishment of debt and debt modification costs (includes prepayment penalties incurred and the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt), one-time weather-related costs, gains or losses on sales of non-depreciable real estate property, shareholder activism, stock compensation expense and preferred stock accretion. We believe that CFFO is helpful to investors as a supplemental performance measure because it excludes the effects of certain items which can create significant earnings volatility, but which do not directly relate to our core recurring property operations. As a result, we believe that CFFO can help facilitate comparisons of operating performance between periods and provides a more meaningful predictor of future earnings potential.
Our calculation of CFFO differs from the methodology used for calculating CFFO by certain other REITs and, accordingly, our CFFO may not be comparable to CFFO reported by other REITs. Our management utilizes FFO and CFFO as measures of our operating performance after adjustment for certain non-cash items, such as depreciation and amortization expenses, and acquisition and pursuit costs that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and that may not accurately compare our operating performance between periods. Furthermore, although FFO and CFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we also believe that FFO and CFFO may provide us and our stockholders with an additional useful measure to compare our financial performance to certain other REITs.
Neither FFO nor CFFO is equivalent to net income, including net income attributable to common stockholders, or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and CFFO do not represent amounts available for management's discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Neither FFO nor CFFO should be considered as an alternative to net income, including net income attributable to common stockholders, as an indicator of our operating performance or as an alternative to cash flow from operating activities as a measure of our liquidity.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
We have acquired seven operating properties, made six property investments through preferred equity interests or mezzanine loans, and sold seven operating properties subsequent to December 31, 2018. Therefore, the results presented in the table below are not directly comparable and should not be considered an indication of our future operating performance.
The table below reconciles our calculations of FFO and CFFO to net loss attributable to common stockholders, the most directly comparable GAAP financial measure, for the three and nine months ended December 31, 2019 and 2018 (in thousands, except per share amounts):
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| Add back: Net loss attributable to Operating Partnership units | | | (5,032 | ) | | | (3,998 | ) | | | (6,779 | ) | | | (12,839 | ) |
| Net loss attributable to common stockholders and unit holders | | | (18,859 | ) | | | (16,783 | ) | | | (26,530 | ) | | | (55,598 | ) |
| Common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Real estate depreciation and amortization(1) | | | 18,483 | | | | 15,785 | | | | 66,670 | | | | 59,103 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | (48,172 | ) | | | — | |
| FFO Attributable to Common Stockholders and Unit Holders | | | (376 | ) | | | (998 | ) | | | (8,032 | ) | | | 3,505 | |
| Common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Non-cash interest expense | | | 826 | | | | 780 | | | | 3,174 | | | | 3,757 | |
| Unrealized loss on derivatives | | | 32 | | | | 3,001 | | | | 2,450 | | | | 2,776 | |
| Loss on extinguishment of debt and debt modification costs | | | 335 | | | | — | | | | 7,199 | | | | 2,226 | |
| Weather-related losses, net | | | 7 | | | | 102 | | | | 313 | | | | 280 | |
| Non-real estate depreciation and amortization | | | 121 | | | | 85 | | | | 448 | | | | 301 | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | (679 | ) | | | — | |
| Shareholder activism | | | — | | | | — | | | | 393 | | | | — | |
| Non-recurring income | | | (68 | ) | | | — | | | | (68 | ) | | | — | |
| Non-cash preferred returns on unconsolidated real estate joint ventures | | | (353 | ) | | | (280 | ) | | | (1,291 | ) | | | (980 | ) |
| Non-cash equity compensation | | | 2,506 | | | | 1,768 | | | | 10,615 | | | | 6,807 | |
| Preferred stock accretion | | | 3,415 | | | | 1,829 | | | | 10,335 | | | | 5,970 | |
| CFFO Attributable to Common Stockholders and Unit Holders | | $ | 6,655 | | | $ | 6,324 | | | $ | 25,413 | | | $ | 24,758 | |
| | | | | | | | | | | | | | | | | |
| Per Share and Unit Information: | | | | | | | | | | | | | | | | |
| FFO Attributable to Common Stockholders and Unit Holders - diluted | | $ | (0.01 | ) | | $ | (0.03 | ) | | $ | (0.26 | ) | | $ | 0.11 | |
| CFFO Attributable to Common Stockholders and Unit Holders - diluted | | $ | 0.21 | | | $ | 0.20 | | | $ | 0.82 | | | $ | 0.80 | |
| | | | | | | | | | | | | | | | | |
| Weighted average common shares and units outstanding - diluted | | | 31,455,630 | | | | 31,113,092 | | | | 30,899,927 | | | | 30,995,249 | |
(1) The real estate depreciation and amortization amount includes our share of consolidated real estate-related depreciation and amortization of intangibles, less amounts attributable to noncontrolling interests – partially owned properties, and our similar estimated share of unconsolidated depreciation and amortization, which is included in earnings of our unconsolidated real estate joint venture investments.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate ("EBITDAre")
NAREIT defines earnings before interest, taxes, depreciation and amortization for real estate ("EBITDAre") (September 2017 White Paper) as net income, computed in accordance with GAAP, before interest expense, income taxes, depreciation and amortization expense, and further adjusted for gains and losses from sales of depreciated operating properties, and impairment write-downs of depreciated operating properties.
We consider EBITDAre to be an appropriate supplemental measure of our performance because it eliminates depreciation, income taxes, interest and non-recurring items, which permits investors to view income from operations unobscured by non-cash items such as depreciation, amortization, the cost of debt or non-recurring items.
Adjusted EBITDAre represents EBITDAre further adjusted for non-comparable items and it is not intended to be a measure of free cash flow for our management’s discretionary use, as it does not consider certain cash requirements such as income tax payments, debt service requirements, capital expenditures and other fixed charges.
EBITDAre and Adjusted EBITDAre are not recognized measurements under GAAP. Because not all companies use identical calculations, our presentation of EBITDAre and Adjusted EBITDAre may not be comparable to similarly titled measures of other companies.
Below is a reconciliation of net loss attributable to common stockholders to EBITDAre (unaudited and dollars in thousands).
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| Net loss attributable to noncontrolling interests | | | (5,215 | ) | | | (4,458 | ) | | | (7,624 | ) | | | (14,123 | ) |
| Preferred stock dividends | | | 12,868 | | | | 9,642 | | | | 46,159 | | | | 35,637 | |
| Preferred stock accretion | | | 3,415 | | | | 1,829 | | | | 10,335 | | | | 5,970 | |
| Interest expense, net | | | 13,728 | | | | 16,935 | | | | 59,554 | | | | 52,998 | |
| Depreciation and amortization | | | 19,309 | | | | 16,754 | | | | 70,079 | | | | 62,382 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | (48,680 | ) | | | — | |
| Loss on extinguishment of debt and debt modification costs | | | 335 | | | | — | | | | 7,258 | | | | 2,277 | |
| EBITDAre | | $ | 30,613 | | | $ | 27,917 | | | $ | 117,330 | | | $ | 102,382 | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Non-real estate depreciation and amortization | | | 121 | | | | 85 | | | | 448 | | | | 301 | |
| Weather-related losses, net | | | 7 | | | | 107 | | | | 355 | | | | 288 | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | (679 | ) | | | — | |
| Shareholder activism | | | — | | | | — | | | | 393 | | | | — | |
| Non-cash equity compensation | | | 2,506 | | | | 1,768 | | | | 10,615 | | | | 6,807 | |
| Non-recurring income | | | (68 | ) | | | — | | | | (68 | ) | | | — | |
| Non-cash preferred returns on unconsolidated real estate joint ventures | | | (353 | ) | | | (280 | ) | | | (1,291 | ) | | | (980 | ) |
| Adjusted EBITDAre | | $ | 33,036 | | | $ | 29,634 | | | $ | 127,659 | | | $ | 108,914 | |
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
Same Store Properties
Same store properties are conventional multifamily residential apartments which were owned and operational for the entire periods presented, including each comparative period.
Property Net Operating Income ("Property NOI")
We believe that net operating income, or NOI, is a useful measure of our operating performance. We define NOI as total rental and other property revenues less total property operating expenses, excluding depreciation and amortization and interest. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income. We use NOI to evaluate our performance on a same store and non-same store basis; NOI measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as a supplemental measure of our financial performance.
Bluerock Residential Growth REIT, Inc.
Fourth Quarter Earnings Release
The following table reflects net loss attributable to common stockholders together with a reconciliation to NOI and to same store and non-same store contributions to consolidated NOI, as computed in accordance with GAAP for the periods presented (unaudited and amounts in thousands):
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| Add back: Net loss attributable to Operating Partnership units | | | (5,032 | ) | | | (3,998 | ) | | | (6,779 | ) | | | (12,839 | ) |
| Net loss attributable to common stockholders and unit holders | | | (18,859 | ) | | | (16,783 | ) | | | (26,530 | ) | | | (55,598 | ) |
| Add common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Depreciation and amortization | | | 18,483 | | | | 15,785 | | | | 66,670 | | | | 59,103 | |
| Non-real estate depreciation and amortization | | | 121 | | | | 85 | | | | 448 | | | | 301 | |
| Non-cash interest expense | | | 826 | | | | 780 | | | | 3,174 | | | | 3,757 | |
| Unrealized loss on derivatives | | | 32 | | | | 3,001 | | | | 2,450 | | | | 2,776 | |
| Loss on extinguishment of debt and debt modification costs | | | 335 | | | | — | | | | 7,199 | | | | 2,226 | |
| Property management fees | | | 1,135 | | | | 1,118 | | | | 4,645 | | | | 4,151 | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Corporate operating expenses | | | 5,545 | | | | 5,552 | | | | 22,261 | | | | 19,416 | |
| Weather-related losses, net | | | 7 | | | | 102 | | | | 313 | | | | 280 | |
| Preferred dividends | | | 12,868 | | | | 9,642 | | | | 46,159 | | | | 35,637 | |
| Preferred stock accretion | | | 3,415 | | | | 1,829 | | | | 10,335 | | | | 5,970 | |
| Less common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Other income | | | 68 | | | | — | | | | 68 | | | | — | |
| Preferred returns on unconsolidated real estate joint ventures | | | 2,700 | | | | 2,435 | | | | 9,797 | | | | 10,312 | |
| Interest income from related parties | | | 6,720 | | | | 5,723 | | | | 24,595 | | | | 22,255 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | 48,172 | | | | — | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | 679 | | | | — | |
| Pro-rata share of properties’ income | | | 14,630 | | | | 12,990 | | | | 54,369 | | | | 45,568 | |
| Add: | | | | | | | | | | | | | | | | |
| Noncontrolling interest pro-rata share of partially owned property income | | | 724 | | | | 774 | | | | 2,810 | | | | 2,629 | |
| Total property income | | | 15,354 | | | | 13,764 | | | | 57,179 | | | | 48,197 | |
| Add: | | | | | | | | | | | | | | | | |
| Interest expense | | | 12,846 | | | | 13,031 | | | | 53,748 | | | | 46,267 | |
| Net operating income | | | 28,200 | | | | 26,795 | | | | 110,927 | | | | 94,464 | |
| Less: | | | | | | | | | | | | | | | | |
| Non-same store net operating income | | | 6,450 | | | | 5,004 | | | | 35,371 | | | | 23,034 | |
| Same store net operating income(1) | | $ | 21,750 | | | $ | 21,791 | | | $ | 75,556 | | | $ | 71,430 | |
(1) Same store portfolio for the three months ended December 31, 2019 consists of 26 properties, which represent 8,779 units. Same store portfolio for the year ended December 31, 2019 consists of 22 properties, which represent 7,613 units.
Contact
Investors:
(888) 558.1031
investor.relations@bluerockre.com
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##
Bluerock Residential Growth REIT, Inc.
Financial and Operating Highlights
For the Three and Twelve Months Ended December 31, 2019
(Unaudited and dollars in thousands except for share and per share data)
| | | Three Months Ended | | | | | | Year Ended | | | | |
| | | December 31, | | | | | | December 31, | | | | |
| OPERATING INFORMATION | | 2019 | | | 2018 | | | % Change | | | 2019 | | | 2018 | | | % Change | |
| | | | | | | | | | | | | | | | | | | |
| Total revenue | | $ | 52,520 | | | $ | 50,011 | | | | 5.0 | % | | $ | 209,971 | | | $ | 184,716 | | | | 13.7 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 2,340,697 | | | $ | 2,018,135 | | | | 16.0 | % | | $ | 2,340,697 | | | $ | 2,018,135 | | | | 16.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Property NOI(1) | | $ | 28,200 | | | $ | 26,795 | | | | 5.2 | % | | $ | 110,927 | | | $ | 94,464 | | | | 17.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Property NOI margins | | | 61.6 | % | | | 60.5 | % | | | 1.8 | % | | | 59.8 | % | | | 58.1 | % | | | 2.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Net loss per common share - Diluted | | $ | (0.62 | ) | | $ | (0.55 | ) | | | - | | | $ | (0.91 | ) | | $ | (1.82 | ) | | | - | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| CFFO attributable to common stockholders and unit holders per share(2) | | $ | 0.21 | | | $ | 0.20 | | | | 5.0 | % | | $ | 0.82 | | | $ | 0.80 | | | | 2.5 | % |
(1)See page 35 for the Company's definition of this non-GAAP measurement and reasons for using it.
(2)See page 33 for the Company's definition of this non-GAAP measurement and reasons for using it.
Bluerock Residential Growth REIT, Inc.
Share and Unit Information
Fourth Quarter 2019
(Unaudited)
| Weighted Average Common Stock and Units Outstanding for the quarter ended December 31, 2019 | | | | |
| Class A Common Stock | | | 22,653,279 | |
| Class C Common Stock | | | 76,603 | |
| Weighted Average Common Stock Outstanding, Diluted | | | 22,729,882 | |
| Warrants(1) | | | 295,747 | |
| Restricted Stock Grants(2) | | | 37,883 | |
| Weighted Average Common Stock Outstanding, Diluted | | | 23,063,512 | |
| LTIP Units | | | 2,007,627 | |
| OP Units | | | 6,384,491 | |
| Weighted Average Common Stock and Total Units Outstanding, Diluted | | | 31,455,630 | |
| | | | | |
| Outstanding Common Stock and Units at December 31, 2019 | | | 32,482,092 | |
| | | | | |
| Outstanding 8.250% Series A Cumulative Redeemable Preferred Stock at December 31, 2019 | | | 5,721,460 | |
| | | | | |
| Outstanding 6.000% Series B Redeemable Preferred Stock at December 31, 2019 | | | 536,695 | |
| | | | | |
| Outstanding 7.625% Series C Cumulative Redeemable Preferred Stock at December 31, 2019 | | | 2,323,750 | |
| | | | | |
| Outstanding 7.125% Series D Cumulative Preferred Stock at December 31, 2019 | | | 2,850,602 | |
| | | | | |
| Outstanding 6.150% Series T Redeemable Preferred Stock at December 31, 2019 | | | 17,400 | |
(1) Potential dilution from warrants outstanding from issuance of Series B Preferred Stock offering that are potentially exercisable into 295,747 shares of common stock.
(2) Potential dilution from vesting of restricted stock grants issued to employees for 37,883 shares of common stock.
The following table reflects the impact of various LTIP Unit issuances, share repurchases, and other share/unit changes subsequent to September 30, 2019:
| Share Type | | Shares and units outstanding
September 30, 2019 | | | Class A ATM Offering | | | Class A common from Series B Company redemptions | | | Class A common from Series B holder redemptions | | | Class A Share Repurchase | | | LTIP Issuances | | | Other | | | Shares and units outstanding
December 31, 2019 | | | Ownership % | |
| Class A Common Stock | | | 22,382,060 | | | | 454,237 | | | | 613,153 | | | | 25,491 | | | | (57,883 | ) | | | - | | | | 5,499 | | | | 23,422,557 | | | | 72.10 | % |
| Class C Common Stock | | | 76,603 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | 76,603 | | | | 0.24 | % |
| Total share equivalents | | | 22,458,663 | | | | 454,237 | | | | 613,153 | | | | 25,491 | | | | (57,883 | ) | | | - | | | | 5,499 | | | | 23,499,160 | | | | 72.34 | % |
| OP Units | | | 6,384,512 | | | | - | | | | - | | | | - | | | | - | | | | - | | | | (45 | ) | | | 6,384,467 | | | | 19.66 | % |
| LTIP Units | | | 2,461,728 | | | | - | | | | - | | | | - | | | | - | | | | 136,737 | | | | - | | | | 2,598,465 | | | | 8.00 | % |
| Total noncontrolling interest | | | 8,846,240 | | | | - | | | | - | | | | - | | | | - | | | | 136,737 | | | | (45 | ) | | | 8,982,932 | | | | 27.66 | % |
| Total shares, OP and LTIP Units | | | 31,304,903 | | | | 454,237 | | | | 613,153 | | | | 25,491 | | | | (57,883 | ) | | | 136,737 | | | | 5,454 | | | | 32,482,092 | | | | 100.00 | % |
Bluerock Residential Growth REIT, Inc.
EBITDAre and Interest Information
Fourth Quarter 2019
(Unaudited and dollars in thousands)
| | | Three Months Ended | |
| | | December 31, | |
| | | 2019 | |
| Q4 EBITDAre Calculation | | | | |
| Net loss attributable to common stockholders | | $ | (13,827 | ) |
| Net loss attributable to noncontrolling interests | | | (5,215 | ) |
| Preferred stock dividends | | | 12,868 | |
| Preferred stock accretion | | | 3,415 | |
| Interest expense, net | | | 13,728 | |
| Depreciation and amortization | | | 19,309 | |
| Loss on early extinguishment of debt | | | 335 | |
| EBITDAre(1) | | $ | 30,613 | |
| Acquisition and pursuit costs | | | 210 | |
| Non-real estate depreciation and amortization | | | 121 | |
| Weather-related losses, net | | | 7 | |
| Non-cash equity compensation | | | 2,506 | |
| Non-recurring income | | | (68 | ) |
| Non-cash preferred returns on unconsolidated real estate joint ventures | | | (353 | ) |
| Adjusted EBITDAre | | $ | 33,036 | |
| | | | | |
| Modified Q4 EBITDAre Calculation(2) | | | | |
| Adjusted EBITDAre | | $ | 33,036 | |
| Adjustment | | | 1,665 | |
| Modified Q4 EBITDAre | | $ | 34,701 | |
| Modified Q4 EBITDAre annualized | | $ | 138,804 | |
| | | | | |
| Modified Q4 Interest Calculation(2)(3) | | | | |
| Interest expense | | $ | 12,846 | |
| Adjustment | | | 1,003 | |
| Modified Q4 interest expense | | $ | 13,849 | |
| Modified Q4 interest expense annualized | | $ | 55,396 | |
(1) See page 34 for a reconciliation of net income attributable to common stockholders to EBITDAre and the Company's definition of EBITDAre and reasons for using it.
(2)Adjustment to EBITDAre and interest expense represents the estimated impact over the full period of the following activity assuming the transactions had occurred on October 1, 2019: (i) acquisitions of Chattahoochee Ridge, The District at Scottsdale, and Navigator Villas, (ii) preferred investment in Strategic Portfolio, (iii) additional investments at Arlo, Cade Boca Raton, North Creek Apartments, Riverside Apartments, The Park at Chapel Hill, and Wayforth at Concord, and (iv) contribution of Cade Boca Raton’s mezzanine loan investment for common ownership interest. Actual results may differ significantly from the presented, adjusted amounts including annualized amounts.
(3) Interest expense excludes non-cash interest expense.
Bluerock Residential Growth REIT, Inc.
Financial Statistics
Fourth Quarter 2019
(Unaudited and dollars in thousands)
| | | Three Months Ended | |
| | | December 31, | |
| | | 2019 | |
| Interest Coverage Ratio | | | | |
| Modified Q4 EBITDAre * | | $ | 34,701 | |
| Modified Q4 interest expense(4) * | | | 13,849 | |
| Interest coverage ratio | | | 2.51 | x |
| | | | | |
| Quarterly Fixed Charge Coverage Ratio | | | | |
| Modified Q4 interest expense(4) * | | $ | 13,849 | |
| Preferred stock dividends | | | 12,868 | |
| Total fixed charges | | $ | 26,717 | |
| Modified Q4 EBITDAre * | | | 34,701 | |
| Modified Q4 EBITDAre fixed charge coverage ratio | | | 1.30 | x |
| | | | | |
| Net Debt / Modified EBITDAre Ratio | | | | |
| Total debt(1) | | $ | 1,453,023 | |
| Less: cash(3) | | | (50,768 | |
| Net debt (total debt less cash) | | $ | 1,402,255 | |
| Modified Q4 EBITDAre (annualized)* | | | 138,804 | |
| Net debt / modified EBITDAre ratio | | | 10.10 | x |
| | | | | |
| Leverage as a Percentage of Assets | | | | |
| Total debt(1) | | $ | 1,453,023 | |
| Total undepreciated assets(2) | | | 2,482,263 | |
| Total debt / total undepreciated assets | | | 58.5 | % |
| Net debt / net undepreciated assets (less cash) | | | 57.7 | % |
| | | | | |
| Leverage as a Percentage of Enterprise Value | | | | |
| Total market cap(5) | | $ | 1,209,900 | |
| Total debt(1) | | | 1,453,023 | |
| Total enterprise value | | $ | 2,662,923 | |
| Total debt / total enterprise value | | | 54.6 | % |
| Net debt / total enterprise value | | | 52.7 | % |
(1)Total debt excludes amortization of fair market value adjustments of $1.8 million and deferred financing costs of $11.6 million.
(2) Total undepreciated assets is calculated as total assets plus accumulated depreciation on real estate assets.
(3) Cash includes cash, cash equivalents, and restricted cash.
(4) Interest expense excludes non-cash interest expense.
(5) Total market cap is calculated by using common shares, preferred shares, and equivalents (OP Units/LTIP Units) multiplied by the December 31, 2019 closing share prices.
* Adjustment to EBITDAre and interest expense represents the estimated impact over the full period of the following activity assuming the transactions had occurred on October 1, 2019: (i) acquisitions of Chattahoochee Ridge, The District at Scottsdale, and Navigator Villas, (ii) preferred investment in Strategic Portfolio, (iii) additional investments at Arlo, Cade Boca Raton, North Creek Apartments, Riverside Apartments, The Park at Chapel Hill, and Wayforth at Concord, and (iv) contribution of Cade Boca Raton’s mezzanine loan investment for common ownership interest. Actual results may differ significantly from the presented, adjusted amounts including annualized amounts. See prior page for calculations.
Bluerock Residential Growth REIT, Inc.
Recent Acquisitions and Investments
(Unaudited)
| Property | | MSA | | Date of Investment | | Year Built/ Renovated(1) | | | Number of Units | | | Ownership Interest in Property | | | Purchase Price
(in millions) | | | Average Rent(2) | |
| Operating Properties | | | | | | | | | | | | | | | | | | | | | | | | |
| Element | | Las Vegas, NV | | 06/27/2019 | | | 1995 | | | | 200 | | | | 100 | % | | $ | 41.8 | | | $ | 1,259 | |
| Providence Trail | | Nashville, TN | | 06/27/2019 | | | 2007 | | | | 334 | | | | 100 | % | | | 68.5 | | | | 1,256 | |
| Denim | | Phoenix, AZ | | 07/24/2019 | | | 1979 | | | | 645 | | | | 100 | % | | | 141.3 | | | | 1,177 | |
| The Sanctuary | | Las Vegas, NV | | 07/31/2019 | | | 1988 | | | | 320 | | | | 100 | % | | | 51.8 | | | | 1,026 | |
| Chattahoochee Ridge | | Atlanta, GA | | 11/12/2019 | | | 1996 | | | | 358 | | | | 90 | % | | | 69.8 | | | | 1,370 | |
| The District at Scottsdale | | Phoenix, AZ | | 12/11/2019 | | | 2018 | | | | 332 | | | | 100 | % | | | 124.0 | | | | 2,161 | |
| Navigator Villas | | Tri-Cities, WA | | 12/18/2019 | | | 2013 | | | | 176 | | | | 90 | % | | | 28.5 | | | | 1,087 | |
| Total Operating Properties | | | | | | | | | | | 2,365 | | | | | | | $ | 525.7 | | | $ | 1,221 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Property | | MSA | | Date of Investment | | Year Built/ Renovated(1) | | | Number of Units | | | | | | Investment Amount
(in millions) | | | Average Rent(2) | |
| Preferred Equity | | | | | | | | | | | | | | | | | | | | | | | | |
| Mira Vista | | Austin, TX | | 09/17/2019 | | | 1983 | | | | 200 | | | | | | | $ | 5.3 | | | $ | 977 | |
| Thornton Flats | | Austin, TX | | 09/25/2019 | | | 2017 | | | | 104 | | | | | | | | 4.6 | | | | 1,551 | |
| Belmont Crossing | | Atlanta, GA | | 12/20/2019 | | | 1964 | | | | 192 | | | | | | | | 2.7 | | | | 789 | |
| Sierra Terrace | | Atlanta, GA | | 12/20/2019 | | | 1968 | | | | 135 | | | | | | | | 3.7 | | | | 1,159 | |
| Sierra Village | | Atlanta, GA | | 12/20/2019 | | | 1973 | | | | 154 | | | | | | | | 3.8 | | | | 1,073 | |
| Total Preferred Equity | | | | | | | | | | | 785 | | | | | | | | 20.1 | | | | 1,137 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Senior/Mezzanine Loan | | | | | | | | | | | | | | | | | | | | | | | | |
| The Park at Chapel Hill(3) | | Raleigh-Durham, NC | | 01/23/2019 | | | * | | | | * | | | | | | | | 34.5 | | | | * | |
| Total Senior/Mezzanine Loan | | | | | | | | | | | * | | | | | | | | 34.5 | | | | * | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Total | | | | | | | | | | | 785 | | | | | | | $ | 54.6 | | | $ | 1,137 | |
(1)All dates are for the year construction was completed or expects to be completed, or the date that a significant renovation has or will be completed.
(2) Represents the average effective monthly rent per occupied unit for the three months ended December 31, 2019.
(3) Property is a development project. The investment originally included a $7.8 million senior loan and a $0.8 million mezzanine loan. On November 1, 2019, the investment increased to a $5.0 million senior loan and a $29.5 million mezzanine loan.
* The development is in the planning phase; project specifications are in process.
Bluerock Residential Growth REIT, Inc.
Recent Dispositions
(Unaudited and dollars in millions)
| Property | | Location | | Date Sold | | Number of Units | | | Ownership Interest in Property | | | Sale Price | | | BRG Net Proceeds | |
| | | | | | | | | | | | | | | | | |
| Operating Properties | | | | | | | | | | | | | | | | | | | | |
| Wesley Village II(1) | | Charlotte, NC | | 3/1/2019 | | | — | | | | 100 | % | | $ | 1.0 | | | $ | 1.0 | |
| Preston View | | Morrisville, NC | | 7/15/2019 | | | 382 | | | | 100 | % | | | 64.0 | | | | 21.4 | |
| Sorrel | | Frisco, TX | | 7/15/2019 | | | 352 | | | | 100 | % | | | 57.9 | | | | 18.0 | |
| Sovereign | | Fort Worth, TX | | 7/15/2019 | | | 322 | | | | 100 | % | | | 53.0 | | | | 23.5 | |
| ARIUM Palms | | Orlando, FL | | 8/29/2019 | | | 252 | | | | 100 | % | | | 46.8 | | | | 15.3 | |
| Marquis at Crown Ridge | | San Antonio, TX | | 9/20/2019 | | | 352 | | | | 90 | % | | | 38.4 | | | | 9.1 | |
| Marquis at Stone Oak | | San Antonio, TX | | 9/20/2019 | | | 335 | | | | 90 | % | | | 56.6 | | | | 13.1 | |
| Total Operating Properties | | | | | | | 1,995 | | | | | | | | 317.7 | | | | 101.4 | |
| | | | | | | | | | | | | | | | | | | | | |
| Preferred Equity | | | | | | | | | | | | | | | | | | | | |
| Leigh House(2) | | Raleigh, NC | | 7/15/2019 | | | 245 | | | | — | | | | 52.0 | | | | 14.2 | |
| Total Preferred Equity | | | | | | | 245 | | | | | | | | 52.0 | | | | 14.2 | |
| | | | | | | | | | | | | | | | | | | | | |
| Total | | | | | | | 2,240 | | | | | | | $ | 369.7 | | | $ | 115.6 | |
(1)Sale of an undeveloped parcel of land.
(2)Preferred equity investment.
Bluerock Residential Growth REIT, Inc.
Investments in Unconsolidated Real Estate Joint Ventures and Notes and Accrued Interest Receivable from Related Parties
For the Three and Twelve Months Ended December 31, 2019
(Unaudited and dollars in thousands)
| Multifamily Community Name | | Investment Balance as of October 1, 2019 | | | Change | | | Investment Balance as of December 31, 2019 | | | Return as of December 31, 2019 | | | CFFO Earned for the Three Months Ended December 31, 2019 | | | CFFO Earned for the Year Ended December 31, 2019 | |
| Preferred and Equity Investments | | | | | | | | | | | | | | | | | | | | | | | | |
| Operating – Stabilized | | | | | | | | | | | | | | | | | | | | | | | | |
| Alexan CityCentre | | $ | 12,788 | | | $ | - | | | | 12,788 | | | | 17.5 | % | | $ | 563 | | | $ | 2,108 | |
| Alexan Southside Place | | | 24,866 | | | | - | | | | 24,866 | | | | 6.5 | % | | | 407 | | | | 1,583 | |
| Mira Vista | | | 5,250 | | | | - | | | | 5,250 | | | | 10.1 | % | | | 94 | | | | 107 | |
| Strategic Portfolio | | | - | | | | 10,183 | | | | 10,183 | | | | 10.5 | % | | | 23 | | | | 23 | |
| Thornton Flats | | | 4,600 | | | | - | | | | 4,600 | | | | 9.0 | % | | | 93 | | | | 98 | |
| Total operating - stabilized | | | 47,504 | | | | 10,183 | | | | 57,687 | | | | | | | | 1,180 | | | | 3,919 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Development | | | | | | | | | | | | | | | | | | | | | | | | |
| North Creek Apartments | | | 14,691 | | | | 273 | | | | 14,964 | | | | 12.5 | % | | | 321 | | | | 936 | |
| Riverside Apartments | | | 9,005 | | | | 3,337 | | | | 12,342 | | | | 12.5 | % | | | 215 | | | | 597 | |
| Wayforth at Concord | | | 1,456 | | | | 3,227 | | | | 4,683 | | | | 13.0 | % | | | 66 | | | | 84 | |
| Total development | | | 25,152 | | | | 6,837 | | | | 31,989 | | | | | | | | 602 | | | | 1,617 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Under Contract/Sold | | | | | | | | | | | | | | | | | | | | | | | | |
| Helios | | | 19,189 | | | | 4,474 | | | | 23,663 | | | | 7.0 | % | | | 339 | | | | 1,343 | |
| Leigh House(1) | | | 522 | | | | (442 | ) | | | 80 | | | | - | | | | - | | | | 1,155 | |
| Whetstone Apartments | | | 12,932 | | | | - | | | | 12,932 | | | | 7.2% accrued(2) | | | | 226 | | | | 472 | |
| Total under contract/sold | | | 32,643 | | | | 4,032 | | | | 36,675 | | | | | | | | 565 | | | | 2,970 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Other | | | 100 | | | | (7 | ) | | | 93 | | | | (3) | | | | - | | | | - | |
| | | $ | 105,399 | | | $ | 21,045 | | | $ | 126,444 | | | | | | | $ | 2,347 | | | $ | 8,506 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Mezzanine Loans | | | | | | | | | | | | | | | | | | | | | | | | |
| Lease-up | | | | | | | | | | | | | | | | | | | | | | | | |
| Arlo(3) | | $ | 26,571 | | | $ | 1,034 | | | | 27,605 | | | | 15.0 | % | | $ | 998 | | | $ | 3,757 | |
| Domain at The One Forty(3) | | | 23,420 | | | | 10 | | | | 23,430 | | | | 15.0 | % | | | 875 | | | | 3,280 | |
| Novel Perimeter(3) | | | 20,859 | | | | 8 | | | | 20,867 | | | | 15.0 | % | | | 779 | | | | 3,091 | |
| Vickers Historic Roswell(3) | | | 11,619 | | | | 5 | | | | 11,624 | | | | 15.0 | % | | | 434 | | | | 1,643 | |
| Total lease-up | | | 82,469 | | | | 1,057 | | | | 83,526 | | | | | | | | 3,086 | | | | 11,771 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Development | | | | | | | | | | | | | | | | | | | | | | | | |
| Flagler Village(3) | | | 75,409 | | | | 27 | | | | 75,436 | | | | 12.9 | % | | | 2,426 | | | | 9,626 | |
| The Park at Chapel Hill(4) | | | 8,570 | | | | 26,249 | | | | 34,819 | | | | 10.9 | % | | | 691 | | | | 1,273 | |
| Total development | | | 83,979 | | | | 26,276 | | | | 110,255 | | | | | | | | 3,117 | | | | 10,899 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Contributed for Common Equity | | | | | | | | | | | | | | | | | | | | | | | | |
| Cade Boca Raton | | | 13,813 | | | | (13,813 | ) | | | - | | | | - | | | | 517 | | | | 1,925 | |
| Total contributed for common equity | | | 13,813 | | | | (13,813 | ) | | | - | | | | | | | | 517 | | | | 1,925 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | $ | 180,261 | | | $ | 13,520 | | | $ | 193,781 | | | | | | | $ | 6,720 | | | $ | 24,595 | |
(1)Represents remaining net assets in the joint venture after receipt of $14.2 million in proceeds for the preferred equity investment.
(2)Effective April 1, 2017, the preferred income is being accrued, except for payments totaling $0.5 million received in 2019.
(3)The Company also holds an equity method investment with 0.5% common ownership.
(4)The investment includes a $5.0 million senior loan and a $29.5 million mezzanine loan.
Bluerock Residential Growth REIT, Inc.
Portfolio Information
Fourth Quarter 2019
(Unaudited)
| Multifamily Community Name | | Location | | Number of Units | | | Year Built/
Renovated(1) | | | Average Rent(2) | | | Revenue per Occupied Unit(3) | | | Average Occupancy | |
| Consolidated Operating Properties: | | | | | | | | | | | | | | | | | | | | | | |
| ARIUM Glenridge | | Atlanta, GA | | | 480 | | | | 1990 | | | $ | 1,262 | | | $ | 1,379 | | | | 91.2 | % |
| ARIUM Grandewood | | Orlando, FL | | | 306 | | | | 2005 | | | | 1,435 | | | | 1,557 | | | | 95.1 | % |
| ARIUM Hunter’s Creek | | Orlando, FL | | | 532 | | | | 1999 | | | | 1,445 | | | | 1,598 | | | | 93.1 | % |
| ARIUM Metrowest | | Orlando, FL | | | 510 | | | | 2001 | | | | 1,418 | | | | 1,629 | | | | 92.8 | % |
| ARIUM Westside | | Atlanta, GA | | | 336 | | | | 2008 | | | | 1,571 | | | | 1,696 | | | | 97.4 | % |
| Ashford Belmar | | Lakewood, CO | | | 512 | | | | 1988/1993 | | | | 1,658 | | | | 1,833 | | | | 91.6 | % |
| Ashton Reserve | | Charlotte, NC | | | 473 | | | | 2015 | | | | 1,125 | | | | 1,270 | | | | 93.4 | % |
| Cade Boca Raton | | Boca Raton, FL | | | 90 | | | | 2019 | | | | 2,639 | | | | 2,744 | | | | 89.3 | % |
| Chattahoochee Ridge | | Atlanta, GA | | | 358 | | | | 1996 | | | | 1,370 | | | | 1,452 | | | | 92.0 | % |
| Citrus Tower | | Orlando, FL | | | 336 | | | | 2006 | | | | 1,328 | | | | 1,469 | | | | 93.7 | % |
| Denim | | Scottsdale, AZ | | | 645 | | | | 1979 | | | | 1,177 | | | | 1,350 | | | | 97.0 | % |
| Element | | Las Vegas, NV | | | 200 | | | | 1995 | | | | 1,259 | | | | 1,503 | | | | 92.6 | % |
| Enders Place at Baldwin Park | | Orlando, FL | | | 220 | | | | 2003 | | | | 1,799 | | | | 1,914 | | | | 95.3 | % |
| Gulfshore Apartment Homes, formerly ARIUM Gulfshore | | Naples, FL | | | 368 | | | | 2016 | | | | 1,316 | | | | 1,444 | | | | 88.3 | % |
| James on South First | | Austin, TX | | | 250 | | | | 2016 | | | | 1,325 | | | | 1,467 | | | | 93.0 | % |
| Marquis at The Cascades | | Tyler, TX | | | 582 | | | | 2009 | | | | 1,238 | | | | 1,313 | | | | 93.7 | % |
| Marquis at TPC | | San Antonio, TX | | | 139 | | | | 2008 | | | | 1,494 | | | | 1,629 | | | | 94.1 | % |
| Navigator Villas | | Pasco, WA | | | 176 | | | | 2013 | | | | 1,087 | | | | 1,248 | | | | 95.5 | % |
| Outlook at Greystone | | Birmingham, AL | | | 300 | | | | 2007 | | | | 1,018 | | | | 1,191 | | | | 93.7 | % |
| Park & Kingston | | Charlotte, NC | | | 168 | | | | 2015 | | | | 1,331 | | | | 1,390 | | | | 95.2 | % |
| Pine Lakes Preserve, formerly ARIUM Pine Lakes | | Port St. Lucie, FL | | | 320 | | | | 2003 | | | | 1,333 | | | | 1,491 | | | | 92.1 | % |
| Plantation Park | | Lake Jackson, TX | | | 238 | | | | 2016 | | | | 1,362 | | | | 1,477 | | | | 90.1 | % |
| Providence Trail | | Mount Juliet, TN | | | 334 | | | | 2007 | | | | 1,256 | | | | 1,433 | | | | 93.3 | % |
| Roswell City Walk | | Roswell, GA | | | 320 | | | | 2015 | | | | 1,549 | | | | 1,778 | | | | 95.1 | % |
| Sands Parc | | Daytona Beach, FL | | | 264 | | | | 2017 | | | | 1,374 | | | | 1,577 | | | | 95.2 | % |
| The Brodie | | Austin, TX | | | 324 | | | | 2001 | | | | 1,321 | | | | 1,492 | | | | 96.8 | % |
| The District at Scottsdale | | Scottsdale, AZ | | | 332 | | | | 2018 | | | | 2,161 | | | | 2,234 | | | | 60.0 | % |
| The Links at Plum Creek | | Castle Rock, CO | | | 264 | | | | 2000 | | | | 1,456 | | | | 1,586 | | | | 92.9 | % |
| The Mills | | Greenville, SC | | | 304 | | | | 2013 | | | | 1,071 | | | | 1,188 | | | | 93.7 | % |
| The Preserve at Henderson Beach | | Destin, FL | | | 340 | | | | 2009 | | | | 1,474 | | | | 1,622 | | | | 94.5 | % |
| The Reserve at Palmer Ranch, formerly ARIUM at Palmer Ranch | | Sarasota, FL | | | 320 | | | | 2016 | | | | 1,305 | | | | 1,455 | | | | 93.3 | % |
| The Sanctuary | | Las Vegas, NV | | | 320 | | | | 1988 | | | | 1,026 | | | | 1,156 | | | | 90.8 | % |
| Veranda at Centerfield | | Houston, TX | | | 400 | | | | 1999 | | | | 981 | | | | 1,136 | | | | 94.9 | % |
| Villages of Cypress Creek | | Houston, TX | | | 384 | | | | 2001 | | | | 1,155 | | | | 1,278 | | | | 94.0 | % |
| Wesley Village | | Charlotte, NC | | | 301 | | | | 2010 | | | | 1,372 | | | | 1,483 | | | | 92.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | |
| Total Consolidated Operating Properties | | | | | 11,746 | | | | | | | $ | 1,319 | (5) | | $ | 1,466 | (5) | | | 93.6 | %(5) |
| | | | | | | | | | | | | | | | | | | | | | | |
| Mezzanine/Preferred Investments: | | | | | | | | | | | | | | | | | | | | | | |
| Alexan CityCentre | | Houston, TX | | | 340 | | | | | | | $ | 1,721 | | | $ | 1,876 | | | | 88.8 | % |
| Alexan Southside Place | | Houston, TX | | | 270 | | | | | | | | 1,710 | | | | 1,838 | | | | 96.5 | % |
| Arlo | | Charlotte, NC | | | 286 | | | | | | | | 1,507 | (4) | | | N/A | | | | N/A | |
| Belmont Crossing | | Smyrna, GA | | | 192 | | | | | | | | 789 | | | | 902 | | | | 89.6 | % |
| Domain at The One Forty | | Garland, TX | | | 299 | | | | | | | | 1,469 | (4) | | | N/A | | | | N/A | |
| Helios | | Atlanta, GA | | | 282 | | | | | | | | 1,443 | | | | 1,542 | | | | 96.3 | % |
| Mira Vista | | Austin, TX | | | 200 | | | | | | | | 977 | | | | 1,050 | | | | 95.3 | % |
| Motif, formerly Flagler Village | | Fort Lauderdale, FL | | | 385 | | | | | | | | 2,352 | (4) | | | N/A | | | | N/A | |
| North Creek Apartments | | Leander, TX | | | 259 | | | | | | | | 1,358 | (4) | | | N/A | | | | N/A | |
| Novel Perimeter | | Atlanta, GA | | | 320 | | | | | | | | 1,749 | (4) | | | N/A | | | | N/A | |
| Riverside Apartments | | Austin, TX | | | 222 | | | | | | | | 1,408 | (4) | | | N/A | | | | N/A | |
| Sierra Terrace | | Atlanta, GA | | | 135 | | | | | | | | 1,159 | | | | 1,285 | | | | 97.0 | % |
| Sierra Village | | Atlanta, GA | | | 154 | | | | | | | | 1,073 | | | | 1,169 | | | | 86.4 | % |
| The Park at Chapel Hill | | Chapel Hill, NC | | | * | | | | | | | | * | | | | N/A | | | | N/A | |
| Thornton Flats | | Austin, TX | | | 104 | | | | | | | | 1,551 | | | | 1,744 | | | | 90.7 | % |
| Vickers Historic Roswell | | Roswell, GA | | | 79 | | | | | | | | 3,176 | (4) | | | N/A | | | | N/A | |
| Wayforth at Concord | | Concord, NC | | | 150 | | | | | | | | 1,707 | (4) | | | N/A | | | | N/A | |
| Whetstone Apartments | | Durham, NC | | | 204 | | | | | | | | 1,327 | | | | 1,509 | | | | 94.1 | % |
| | | | | | | | | | | | | | | | | | | | | | | |
| Total Mezzanine/Preferred Investments | | | | | 3,881 | | | | | | | $ | 1,631 | | | $ | 1,595 | | | | 93.4 | % |
| | | | | | | | | | | | | | | | | | | | | | | |
| Total Portfolio | | | | | 15,627 | | | | | | | $ | 1,394 | (5) | | $ | 1,481 | (5) | | | 93.5 | %(5) |
(1)Represents date of last significant renovation or year built if no renovations.
(2) Represents the average effective monthly rent per occupied unit for the three months ended December 31, 2019.
(3) Revenue per occupied unit is total revenue divided by average number of occupied units for the three months ended December 31, 2019.
(4) Represents the average pro forma effective monthly rent per occupied unit for all expected units upon stabilization.
(5) Excludes District at Scottsdale, which is in lease-up, and Cade Boca Raton, which was consolidated on December 31, 2019 and had no operations for the quarter.
* The development is in the planning phase; project specifications are in process.
Bluerock Residential Growth REIT, Inc.
Renovation Table
As of December 31, 2019
(Unaudited)
| Units and Investment | | | | | | | | | | | | |
| | | 2019 | | | To Date | |
| | | Completed | | | Completed | | | Total | | | Unrenovated Units | |
| | | in 4Q | | | Year-to-date | | | Completed | | | Remaining | |
| Number of Renovations | | | 211 | | | | 979 | | | | 2,645 | | | | 4,515 | |
| Renovation Cost per Unit | | $ | 9,462 | | | $ | 6,442 | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Returns | | | | | | | | | | | | | | | | |
| | | Cost | | | Monthly Rent | | | Return on | | | | | |
| | | per Unit | | | Premium | | | Investment | | | | | |
| Weighted Average Returns to Date | | $ | 5,682 | | | $ | 111 | | | | 23.5 | % | | | | |
Bluerock Residential Growth REIT, Inc.
Lease-up and Development Mezzanine/Preferred Investments
As of December 31, 2019
(Unaudited)
This table includes forward-looking statements based on current judgments and current knowledge of management, which are subject to certain risks, trends and uncertainties that could cause results to vary from those projected. Please see the paragraph on forward-looking statements on page 2 of this document for a discussion of risks and uncertainties.
| | | | | | | | | | | | | | | | | | Actual/Estimated Dates for | |
| Multifamily Community Name | | Actual/ Planned Number of Units | | | Total Actual/ Estimated Construction Cost (in millions) | | | Cost to Date (in millions) | | | Actual/ Estimated Construction
Cost Per Unit | | | Total Available Financing (in millions) | | | Construction Start | | | Initial Occupancy | | | Construction Completion | | | Stabilized Operations(1) | |
| Lease-up Investments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Vickers Historic Roswell(2) | | | 79 | | | $ | 31.9 | | | $ | 30.3 | | | $ | 403,797 | | | $ | 22.0 | | | | 2Q16 | | | | 2Q18 | | | | 3Q18 | | | | 3Q20 | |
| Domain at The One Forty(2) | | | 299 | | | $ | 53.3 | | | $ | 51.4 | | | $ | 178,261 | | | $ | 39.2 | | | | 1Q17 | | | | 2Q18 | | | | 4Q18 | | | | 2Q20 | |
| Arlo(2) | | | 286 | | | $ | 60.0 | | | $ | 58.4 | | | $ | 209,790 | | | $ | 41.8 | | | | 4Q16 | | | | 2Q18 | | | | 1Q19 | | | | 3Q20 | |
| Novel Perimeter(2) | | | 320 | | | $ | 71.0 | | | $ | 68.4 | | | $ | 221,875 | | | $ | 44.7 | | | | 4Q16 | | | | 3Q18 | | | | 1Q19 | | | | 3Q20 | |
| Total lease-up units | | | 984 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Development Investments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Motif, formerly Flagler Village(2) | | | 385 | | | $ | 135.4 | | | $ | 117.3 | | | $ | 351,688 | | | $ | 70.4 | | | | 1Q18 | | | | 2Q20 | | | | 3Q20 | | | | 2Q22 | |
| North Creek Apartments(3) | | | 259 | | | $ | 44.0 | | | $ | 24.6 | | | $ | 169,884 | | | $ | 23.6 | | | | 4Q18 | | | | 3Q20 | | | | 4Q20 | | | | 3Q21 | |
| Riverside Apartments(3) | | | 222 | | | $ | 37.9 | | | $ | 14.2 | | | $ | 170,721 | | | $ | 20.2 | | | | 2Q19 | | | | 4Q20 | | | | 1Q21 | | | | 3Q21 | |
| Wayforth at Concord(3) | | | 150 | | | $ | 33.5 | | | $ | 10.3 | | | $ | 223,333 | | | $ | 22.3 | | | | 4Q18 | | | | 2Q20 | | | | 3Q21 | | | | 3Q21 | |
| The Park at Chapel Hill | | | (4) | | | | (4) | | | | (4) | | | | (4) | | | | (4) | | | | (4) | | | | (4) | | | | (4) | | | | (4) | |
| Total development units | | | 1,016 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total units | | | 2,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(1)We define stabilized occupancy as attainment of 90% physical occupancy.
(2)Represents a mezzanine loan investment. Arlo and Vickers Historic Roswell have an option to purchase indirect property interest upon maturity.
(3)Represents a preferred equity investment. North Creek Apartments, Riverside Apartments, and Wayforth at Concord have an option to purchase the property at stabilization.
(4)The development is in the planning phase; project specifications are in process.
Bluerock Residential Growth REIT, Inc.
Condensed Consolidated Balance Sheets
Fourth Quarter 2019
(Unaudited and dollars in thousands except for share and per share data)
| | | December 31,
2019 | | | December 31,
2018 | |
| ASSETS | | | | | | | | |
| Net Real Estate Investments | | | | | | | | |
| Land | | $ | 268,244 | | | $ | 200,385 | |
| Buildings and improvements | | | 1,752,738 | | | | 1,546,244 | |
| Furniture, fixtures and equipment | | | 67,836 | | | | 55,050 | |
| Construction in progress | | | 68 | | | | 989 | |
| Total Gross Real Estate Investments | | | 2,088,886 | | | | 1,802,668 | |
| Accumulated depreciation | | | (141,566 | ) | | | (108,911 | ) |
| Total Net Real Estate Investments | | | 1,947,320 | | | | 1,693,757 | |
| Cash and cash equivalents | | | 31,683 | | | | 24,775 | |
| Restricted cash | | | 19,085 | | | | 27,469 | |
| Notes and accrued interest receivable from related parties | | | 193,781 | | | | 164,084 | |
| Due from affiliates | | | 4,077 | | | | 2,854 | |
| Accounts receivable, prepaids and other assets | | | 15,209 | | | | 14,395 | |
| Preferred equity investments and investments in unconsolidated real estate joint ventures | | | 126,444 | | | | 89,033 | |
| In-place lease intangible assets, net | | | 3,098 | | | | 1,768 | |
| TOTAL ASSETS | | $ | 2,340,697 | | | $ | 2,018,135 | |
| | | | | | | | | |
| LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY | | | | | | | | |
| Mortgages payable | | $ | 1,425,257 | | | $ | 1,206,136 | |
| Revolving credit facilities | | | 18,000 | | | | 82,209 | |
| Accounts payable | | | 1,488 | | | | 1,486 | |
| Other accrued liabilities | | | 27,499 | | | | 31,690 | |
| Due to affiliates | | | 790 | | | | 726 | |
| Distributions payable | | | 13,541 | | | | 12,073 | |
| Total Liabilities | | | 1,486,575 | | | | 1,334,320 | |
| 8.250% Series A Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 10,875,000 shares authorized; 5,721,460 shares issued and outstanding at December 31, 2019 and 2018 | | | 140,355 | | | | 139,545 | |
| 6.000% Series B Redeemable Preferred Stock, liquidation preference $1,000 per share, 1,225,000 shares authorized; 536,695 and 306,009 shares issued and outstanding as of December 31, 2019 and 2018, respectively | | | 480,921 | | | | 272,842 | |
| 7.625% Series C Cumulative Redeemable Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,323,750 shares issued and outstanding as of December 31, 2019 and 2018 | | | 56,797 | | | | 56,485 | |
| 6.150% Series T Redeemable Preferred Stock, liquidation preference $25.00 per share, 32,000,000 shares authorized; 17,400 and no shares issued and outstanding as of December 31, 2019 and 2018, respectively | | | 388 | | | | — | |
| Equity | | | | | | | | |
| Stockholders’ Equity | | | | | | | | |
| Preferred stock, $0.01 par value, 197,900,000 shares authorized; no shares issued and outstanding as of December 31, 2019 and 2018 | | | — | | | | — | |
| 7.125% Series D Cumulative Preferred Stock, liquidation preference $25.00 per share, 4,000,000 shares authorized; 2,850,602 shares issued and outstanding at December 31, 2019 and 2018 | | | 68,705 | | | | 68,705 | |
| Common stock - Class A, $0.01 par value, 747,509,582 shares authorized; 23,422,557 and 23,322,211 shares issued and outstanding as of December 31, 2019 and 2018, respectively | | | 234 | | | | 233 | |
| Common stock - Class C, $0.01 par value, 76,603 shares authorized; 76,603 shares issued and outstanding as of December 31, 2019 and 2018 | | | 1 | | | | 1 | |
| Additional paid-in-capital | | | 311,683 | | | | 307,938 | |
| Distributions in excess of cumulative earnings | | | (253,132 | ) | | | (218,531 | ) |
| Total Stockholders’ Equity | | | 127,491 | | | | 158,346 | |
| Noncontrolling Interests | | | | | | | | |
| Operating partnership units | | | 19,331 | | | | 27,613 | |
| Partially owned properties | | | 28,839 | | | | 28,984 | |
| Total Noncontrolling Interests | | | 48,170 | | | | 56,597 | |
| Total Equity | | | 175,661 | | | | 214,943 | |
| TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY | | $ | 2,340,697 | | | $ | 2,018,135 | |
Bluerock Residential Growth REIT, Inc.
Consolidated Statements of Operations
For the Three and Twelve Months Ended December 31, 2019 and 2018
(Dollars in thousands)
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Revenues | | | | | | | | | | | | | | | | |
| Net rental income | | $ | 40,565 | | | $ | 39,534 | | | $ | 164,498 | | | $ | 144,325 | |
| Other property revenues | | | 5,235 | | | | 4,754 | | | | 20,878 | | | | 18,136 | |
| Rental and other property revenues | | | 45,800 | | | | 44,288 | | | | 185,376 | | | | 162,461 | |
| Interest income from related parties | | | 6,720 | | | | 5,723 | | | | 24,595 | | | | 22,255 | |
| Total revenues | | | 52,520 | | | | 50,011 | | | | 209,971 | | | | 184,716 | |
| Expenses | | | | | | | | | | | | | | | | |
| Property operating | | | 17,600 | | | | 17,493 | | | | 74,449 | | | | 67,997 | |
| Property management fees | | | 1,192 | | | | 1,184 | | | | 4,899 | | | | 4,391 | |
| General and administrative | | | 5,620 | | | | 5,623 | | | | 22,553 | | | | 19,553 | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Weather-related losses, net | | | 7 | | | | 107 | | | | 355 | | | | 288 | |
| Depreciation and amortization | | | 19,355 | | | | 16,839 | | | | 70,452 | | | | 62,683 | |
| Total expenses | | | 43,984 | | | | 41,283 | | | | 173,264 | | | | 155,028 | |
| Operating income | | | 8,536 | | | | 8,728 | | | | 36,707 | | | | 29,688 | |
| Other income (expense) | | | | | | | | | | | | | | | | |
| Other income | | | 68 | | | | — | | | | 68 | | | | — | |
| Preferred returns on unconsolidated real estate joint ventures | | | 2,700 | | | | 2,435 | | | | 9,797 | | | | 10,312 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | 48,680 | | | | — | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | 679 | | | | — | |
| Loss on extinguishment of debt and debt modification costs | | | (335 | ) | | | — | | | | (7,258 | ) | | | (2,277 | ) |
| Interest expense, net | | | (13,728 | ) | | | (16,935 | ) | | | (59,554 | ) | | | (52,998 | ) |
| Total other (expense) income | | | (11,295 | ) | | | (14,500 | ) | | | (7,588 | ) | | | (44,963 | ) |
| Net (loss) income | | | (2,759 | ) | | | (5,772 | ) | | | 29,119 | | | | (15,275 | ) |
| Preferred stock dividends | | | (12,868 | ) | | | (9,642 | ) | | | (46,159 | ) | | | (35,637 | ) |
| Preferred stock accretion | | | (3,415 | ) | | | (1,829 | ) | | | (10,335 | ) | | | (5,970 | ) |
| Net loss attributable to noncontrolling interests | | | | | | | | | | | | | | | | |
| Operating Partnership units | | | (5,032 | ) | | | (3,998 | ) | | | (6,779 | ) | | | (12,839 | ) |
| Partially owned properties | | | (183 | ) | | | (460 | ) | | | (845 | ) | | | (1,284 | ) |
| Net loss attributable to noncontrolling interests | | | (5,215 | ) | | | (4,458 | ) | | | (7,624 | ) | | | (14,123 | ) |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| | | | | | | | | | | | | | | | | |
| Net loss per common share - Basic | | $ | (0.62 | ) | | $ | (0.55 | ) | | $ | (0.91 | ) | | $ | (1.82 | ) |
| | | | | | | | | | | | | | | | | |
| Net loss per common share – Diluted | | $ | (0.62 | ) | | $ | (0.55 | ) | | $ | (0.91 | ) | | $ | (1.82 | ) |
| | | | | | | | | | | | | | | | | |
| Weighted average basic common shares outstanding | | | 22,729,882 | | | | 23,702,897 | | | | 22,649,222 | | | | 23,845,800 | |
| Weighted average diluted common shares outstanding | | | 22,729,882 | | | | 23,702,897 | | | | 22,649,222 | | | | 23,845,800 | |
Bluerock Residential Growth REIT, Inc.
Reconciliation of Funds from Operations (FFO) and Core FFO (CFFO) Attributable to Common Stockholders and Unit Holders
For the Three and Twelve Months Ended December 31, 2019 and 2018
(Unaudited and dollars in thousands except for share and per share data)
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| Add back: Net loss attributable to Operating Partnership units | | | (5,032 | ) | | | (3,998 | ) | | | (6,779 | ) | | | (12,839 | ) |
| Net loss attributable to common stockholders and unit holders | | | (18,859 | ) | | | (16,783 | ) | | | (26,530 | ) | | | (55,598 | ) |
| Common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Real estate depreciation and amortization(1) | | | 18,483 | | | | 15,785 | | | | 66,670 | | | | 59,103 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | (48,172 | ) | | | — | |
| FFO Attributable to Common Stockholders and Unit Holders | | | (376 | ) | | | (998 | ) | | | (8,032 | ) | | | 3,505 | |
| Common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Non-cash interest expense | | | 826 | | | | 780 | | | | 3,174 | | | | 3,757 | |
| Unrealized loss on derivatives | | | 32 | | | | 3,001 | | | | 2,450 | | | | 2,776 | |
| Loss on extinguishment of debt and debt modification costs | | | 335 | | | | — | | | | 7,199 | | | | 2,226 | |
| Weather-related losses, net | | | 7 | | | | 102 | | | | 313 | | | | 280 | |
| Non-real estate depreciation and amortization | | | 121 | | | | 85 | | | | 448 | | | | 301 | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | (679 | ) | | | — | |
| Shareholder activism | | | — | | | | — | | | | 393 | | | | — | |
| Non-recurring income | | | (68 | ) | | | — | | | | (68 | ) | | | — | |
| Non-cash preferred returns on unconsolidated real estate joint ventures | | | (353 | ) | | | (280 | ) | | | (1,291 | ) | | | (980 | ) |
| Non-cash equity compensation | | | 2,506 | | | | 1,768 | | | | 10,615 | | | | 6,807 | |
| Preferred stock accretion | | | 3,415 | | | | 1,829 | | | | 10,335 | | | | 5,970 | |
| CFFO Attributable to Common Stockholders and Unit Holders | | $ | 6,655 | | | $ | 6,324 | | | $ | 25,413 | | | $ | 24,758 | |
| | | | | | | | | | | | | | | | | |
| Per Share and Unit Information: | | | | | | | | | | | | | | | | |
| FFO Attributable to Common Stockholders and Unit Holders - diluted | | $ | (0.01 | ) | | $ | (0.03 | ) | | $ | (0.26 | ) | | $ | 0.11 | |
| CFFO Attributable to Common Stockholders and Unit Holders - diluted | | $ | 0.21 | | | $ | 0.20 | | | $ | 0.82 | | | $ | 0.80 | |
| | | | | | | | | | | | | | | | | |
| Weighted average common shares and units outstanding - diluted | | | 31,455,630 | | | | 31,113,092 | | | | 30,899,927 | | | | 30,995,249 | |
(1) The real estate depreciation and amortization amount includes our share of consolidated real estate-related depreciation and amortization of intangibles, less amounts attributable to noncontrolling interests – partially owned properties, and our similar estimated share of unconsolidated depreciation and amortization, which is included in earnings of our unconsolidated real estate joint venture investments.
Bluerock Residential Growth REIT, Inc.
Mortgages Payable Summary Information
As of December 31, 2019
(Unaudited and dollars in thousands)
| Property | | Outstanding Principal | | | Interest Rate | | | Fixed/ Floating | | Maturity Date |
| ARIUM Glenridge | | $ | 49,500 | | | | 3.03 | % | | L + 1.33% subject to Cap(1) | | September 1, 2025 |
| ARIUM Grandewood | | | 39,385 | | | | 3.72 | % | | (2) | | July 1, 2025 |
| ARIUM Hunter’s Creek | | | 72,183 | | | | 3.65 | % | | Fixed | | November 1, 2024 |
| ARIUM Metrowest | | | 64,559 | | | | 4.43 | % | | Fixed | | May 1, 2025 |
| ARIUM Westside | | | 52,150 | | | | 3.68 | % | | Fixed | | August 1, 2023 |
| Ashford Belmar | | | 100,675 | | | | 4.53 | % | | Fixed | | December 1, 2025 |
| Ashton Reserve I | | | 30,329 | | | | 4.67 | % | | Fixed | | December 1, 2025 |
| Ashton Reserve II | | | 15,213 | | | | 3.20 | % | | L + 1.50% subject to Cap(1) | | August 1, 2025 |
| Cade Boca Raton | | | 23,500 | | | | 3.20 | % | | L + 1.50% subject to Cap(1) | | January 1, 2025 |
| Chattahoochee Ridge | | | 45,338 | | | | 3.25 | % | | Fixed | | December 5, 2024 |
| Citrus Tower | | | 41,325 | | | | 4.07 | % | | Fixed | | October 1, 2024 |
| Denim | | | 91,634 | | | | 3.32 | % | | Fixed | | August 1, 2029 |
| Element | | | 29,260 | | | | 3.63 | % | | Fixed | | July 1, 2026 |
| Enders Place at Baldwin Park(3) | | | 23,337 | | | | 4.30 | % | | Fixed | | November 1, 2022 |
| Gulfshore Apartment Homes, formerly ARIUM Gulfshore | | | 46,345 | | | | 3.26 | % | | Fixed | | September 1, 2029 |
| James on South First | | | 26,111 | | | | 4.35 | % | | Fixed | | January 1, 2024 |
| Marquis at The Cascades I | | | 32,284 | | | | 3.31 | % | | L + 1.61% subject to Cap(1) | | June 1, 2024 |
| Marquis at The Cascades II | | | 22,531 | | | | 3.31 | % | | L + 1.61% subject to Cap(1) | | June 1, 2024 |
| Marquis at TPC | | | 16,468 | | | | 3.31 | % | | L + 1.61% subject to Cap(1) | | June 1, 2024 |
| Navigator Villas | | | 20,515 | | | | 4.56 | % | | Fixed | | June 1, 2028 |
| Outlook at Greystone | | | 22,105 | | | | 4.30 | % | | Fixed | | June 1, 2025 |
| Park & Kingston | | | 19,600 | | | | 3.32 | % | | Fixed | | November 1, 2026 |
| Pine Lakes Reserve, formerly ARIUM Pine Lakes | | | 26,950 | | | | 3.95 | % | | Fixed | | November 1, 2023 |
| Plantation Park | | | 26,625 | | | | 4.64 | % | | Fixed | | July 1, 2028 |
| Providence Trail | | | 47,950 | | | | 3.54 | % | | Fixed | | July 1, 2026 |
| Roswell City Walk | | | 51,000 | | | | 3.63 | % | | Fixed | | December 1, 2026 |
| The Brodie | | | 34,198 | | | | 3.71 | % | | Fixed | | December 1, 2023 |
| The District at Scottsdale | | | 82,200 | | | | 2.97 | % | | L + 1.25%(1) | | December 11, 2020 |
| The Links at Plum Creek | | | 40,000 | | | | 4.31 | % | | Fixed | | October 1, 2025 |
| The Mills | | | 25,797 | | | | 4.21 | % | | Fixed | | January 1, 2025 |
| The Preserve at Henderson Beach | | | 48,490 | | | | 3.26 | % | | Fixed | | September 1, 2029 |
| The Reserve at Palmer Ranch, formerly ARIUM at Palmer Ranch | | | 41,348 | | | | 4.41 | % | | Fixed | | May 1, 2025 |
| The Sanctuary | | | 33,707 | | | | 3.31 | % | | Fixed | | August 1, 2029 |
| Veranda at Centerfield | | | 26,100 | | | | 2.96 | % | | L + 1.25% subject to Cap(1) | | July 26, 2023 |
| Villages of Cypress Creek | | | 26,200 | | | | 3.23 | % | | Fixed | | October 1, 2022 |
| Wesley Village | | | 40,111 | | | | 4.25 | % | | Fixed | | April 1, 2024 |
| Total | | | 1,435,023 | | | | | | | | | |
| Fair value adjustments | | | 1,815 | | | | | | | | | |
| Deferred financing costs, net | | | (11,581 | ) | | | | | | | | |
| Total | | $ | 1,425,257 | | | | | | | | | |
| Weighted Average Interest Rate | | | 3.74 | % | | | | | | | | |
(1) In December 2019, one month LIBOR in effect was 1.70%. LIBOR rate is subject to a LIBOR rate cap of 2.50% until at earliest July 1, 2021, except for Cade Boca Raton with a rate cap of 3.00%.
(2) The principal balance includes a $19.7 million advance at a fixed rate of 4.35% and a $19.7 million advance at a variable rate of 3.10% as of December 31, 2019.
(3) The principal balance includes a $15.8 million loan at a fixed rate of 3.97% and a $7.5 million supplemental loan at a fixed rate of 5.01%.
Bluerock Residential Growth REIT, Inc.
Mortgages Payable Summary Information Continued
As of December 31, 2019
(Unaudited and dollars in thousands)
Mortgages Payable Maturity Schedules
| Year | | Fixed Rate | | | Floating Rate | | | Total | | | % of Total | |
| 2020 | | $ | 7,329 | | | $ | 83,746 | | | $ | 91,075 | | | | 6.35 | % |
| 2021 | | | 10,320 | | | | 2,124 | | | | 12,444 | | | | 0.87 | % |
| 2022 | | | 59,909 | | | | 3,384 | | | | 63,293 | | | | 4.41 | % |
| 2023 | | | 124,249 | | | | 29,190 | | | | 153,439 | | | | 10.69 | % |
| 2024 | | | 221,756 | | | | 67,835 | | | | 289,591 | | | | 20.18 | % |
| Thereafter | | | 723,992 | | | | 101,189 | | | | 825,181 | | | | 57.50 | % |
| | | $ | 1,147,555 | | | $ | 287,468 | | | $ | 1,435,023 | | | | 100.00 | % |
| Fair Value Adjustments | | | 1,815 | | | | - | | | | 1,815 | | | | | |
| Subtotal | | $ | 1,149,370 | | | $ | 287,468 | | | $ | 1,436,838 | | | | | |
| Deferred Financing Costs, net | | | (9,066 | ) | | | (2,515 | ) | | | (11,581 | ) | | | | |
| Total | | $ | 1,140,304 | | | $ | 284,953 | | | $ | 1,425,257 | | | | | |
| | | Amounts | | | % of Total | | | Weighted Average Interest Rates | | | Weighted Average Maturities (years) | |
| | | | | | | | | | | | | |
| Secured Fixed Rate Debt | | $ | 1,149,370 | | | | 80.0 | % | | | 3.90 | % | | | 6.1 | |
| Secured Floating Rate Debt(1) | | | 287,468 | | | | 20.0 | % | | | 3.10 | % | | | 3.8 | |
| Total/Average | | $ | 1,436,838 | | | | 100.0 | % | | | 3.74 | % | | | 5.7 | |
(1) $181.8 million or 63% of the floating rate debt is subject to a LIBOR rate cap of 2.50% until at earliest July 1, 2021. $23.5 million or 8% relates to the Cade Boca Raton loan, which has a rate cap of 3.00% through January 1, 2023. The remaining $82.2 million, or 29%, relates to the District at Scottsdale loan, which does not have a rate cap.
Bluerock Residential Growth REIT, Inc.
2020 Projected Guidance
(Unaudited and dollars in thousands except for per share data)
| | | 2020 Outlook(3) | |
| | | Low | | | High | |
| Core Funds from Operations Attributable to Common Stockholders and Unit Holders per share | | $ | 0.83 | | | $ | 0.86 | |
| | | | | | | | | |
| Same Store Growth | | | | | | | | |
| Rental income growth | | | 2.5 | % | | | 4.0 | % |
| Property operating expense growth | | | 4.3 | % | | | 5.3 | % |
| NOI growth | | | 2.0 | % | | | 4.0 | % |
| | | | | | | | | |
| Property management fee as a percentage of revenue | | | 2.6 | % | | | 2.5 | % |
| General and administrative expenses(1) | | | 12,400 | | | | 12,100 | |
| Income from preferred equity and mezzanine investments | | | 34,900 | | | | 34,900 | |
| Normal recurring capital expenditures(2) | | | 3,100 | | | | 2,900 | |
| | | | | | | | | |
| Value-add Upgrades | | | | | | | | |
| Forecasted unit count | | | 900 | | | | 1,200 | |
| Return on investment | | | 15 | % | | | 20 | % |
| | | | | | | | | |
| Investments | | | | | | | | |
| Total gross asset value | | | 500,000 | | | | 700,000 | |
| | | | | | | | | |
| Dispositions | | | | | | | | |
| Total gross asset value | | | 275,000 | | | | 400,000 | |
| | | | | | | | | |
| Noncontrolling Interest, Preferred Stock and Share Count Assumptions | | | | | | | | |
| Noncontrolling interest percentage of CFFO - partially owned properties | | | 4.5 | % | | | 4.4 | % |
| Series T preferred stock raise | | | 150,000 | | | | 200,000 | |
| Preferred stock dividends | | | 55,200 | | | | 56,800 | |
| Estimated weighted average diluted common shares and units outstanding | | | 34,100 | | | | 34,100 | |
(1)General and administrative expenses exclude non-cash expenses, such as depreciation and non-cash equity compensation.
(2)Normally recurring capital expenditures exclude development, investment, revenue enhancing and non-recurring capital expenditures.
(3)The Company has not reconciled projected Core Funds from Operations Attributable to Common Stockholders and Unit Holders per share (“CFFO”) guidance to the corresponding GAAP financial measure because it does not provide guidance for various reconciling items. The Company is unable to provide guidance for these reconciling items since certain items that impact net income are outside of its control and cannot be reasonably predicted. Accordingly, reconciliations to the corresponding GAAP financial measures are not available.
Bluerock Residential Growth REIT, Inc.
Definitions of Non-GAAP Financial Measures
The foregoing supplemental financial data includes certain non-GAAP financial measures that we believe are helpful in understanding our business, as further described below. Our definition and calculation of these non-GAAP financial measures may differ from those of other REITs, and may, therefore, not be comparable.
Funds from Operations and Core Funds from Operations, Attributable to Common Stockholders and Unit Holders
We believe that funds from operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts (“NAREIT”), and core funds from operations (“CFFO”) are important non-GAAP supplemental measures of operating performance for a REIT.
FFO attributable to common stockholders and unit holders is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We consider FFO to be an appropriate supplemental measure of our operating performance as it is based on a net income analysis of property portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT, using historical accounting for depreciation, could be less informative. We define FFO, consistent with the NAREIT definition, as net income, computed in accordance with GAAP, excluding gains or losses on sales of depreciable real estate property, plus depreciation and amortization of real estate assets, plus impairment write-downs of depreciable real estate, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect FFO on the same basis.
CFFO makes certain adjustments to FFO, removing the effect of items that do not reflect ongoing property operations such as acquisition expenses, non-cash interest, unrealized gains or losses on derivatives, losses on extinguishment of debt and debt modification costs (includes prepayment penalties incurred and the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt), one-time weather-related costs, gains or losses on sales of non-depreciable real estate property, shareholder activism, stock compensation expense and preferred stock accretion. We believe that CFFO is helpful to investors as a supplemental performance measure because it excludes the effects of certain items which can create significant earnings volatility, but which do not directly relate to our core recurring property operations. As a result, we believe that CFFO can help facilitate comparisons of operating performance between periods and provides a more meaningful predictor of future earnings potential.
Our calculation of CFFO differs from the methodology used for calculating CFFO by certain other REITs and, accordingly, our CFFO may not be comparable to CFFO reported by other REITs. Our management utilizes FFO and CFFO as measures of our operating performance after adjustment for certain non-cash items, such as depreciation and amortization expenses, and acquisition and pursuit costs that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and that may not accurately compare our operating performance between periods. Furthermore, although FFO and CFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we also believe that FFO and CFFO may provide us and our stockholders with an additional useful measure to compare our financial performance to certain other REITs.
Neither FFO nor CFFO is equivalent to net income, including net income attributable to common stockholders, or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and CFFO do not represent amounts available for management's discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Neither FFO nor CFFO should be considered as an alternative to net income, including net income attributable to common stockholders, as an indicator of our operating performance or as an alternative to cash flow from operating activities as a measure of our liquidity.
We have acquired seven operating properties, made six property investments through preferred equity interests or mezzanine loans and sold seven operating properties subsequent to December 31, 2018. The results presented are not directly comparable and should not be considered an indication of our future operating performance (unaudited and dollars in thousands, except share and per share data).
Same Store Properties
Same store properties are conventional multifamily residential apartments which were owned and operational for the entire periods presented.
Bluerock Residential Growth REIT, Inc.
Definitions of Non-GAAP Financial Measures
(Unaudited and dollars in thousands)
Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate ("EBITDAre")
NAREIT defines earnings before interest, taxes, depreciation and amortization for real estate ("EBITDAre") (September 2017 White Paper) as net income, computed in accordance with GAAP, before interest expense, income taxes, depreciation and amortization expense, and further adjusted for gains and losses from sales of depreciated operating properties, and impairment write-downs of depreciated operating properties.
We consider EBITDAre to be an appropriate supplemental measure of our performance because it eliminates depreciation, income taxes, interest and non-recurring items, which permits investors to view income from operations unobscured by non-cash items such as depreciation, amortization, the cost of debt or non-recurring items.
Adjusted EBITDAre represents EBITDAre further adjusted for non-comparable items and it is not intended to be a measure of free cash flow for our management’s discretionary use, as it does not consider certain cash requirements such as income tax payments, debt service requirements, capital expenditures and other fixed charges.
EBITDAre and Adjusted EBITDAre are not recognized measurements under GAAP. Because not all companies use identical calculations, our presentation of EBITDAre and Adjusted EBITDAre may not be comparable to similarly titled measures of other companies.
The reconciliations of net loss attributable to common stockholders to EBITDAre and Adjusted EBITDAre are presented in the table below:
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| Net loss attributable to noncontrolling interests | | | (5,215 | ) | | | (4,458 | ) | | | (7,624 | ) | | | (14,123 | ) |
| Preferred stock dividends | | | 12,868 | | | | 9,642 | | | | 46,159 | | | | 35,637 | |
| Preferred stock accretion | | | 3,415 | | | | 1,829 | | | | 10,335 | | | | 5,970 | |
| Interest expense, net | | | 13,728 | | | | 16,935 | | | | 59,554 | | | | 52,998 | |
| Depreciation and amortization | | | 19,309 | | | | 16,754 | | | | 70,079 | | | | 62,382 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | (48,680 | ) | | | — | |
| Loss on extinguishment of debt and debt modification costs | | | 335 | | | | — | | | | 7,258 | | | | 2,277 | |
| EBITDAre | | $ | 30,613 | | | $ | 27,917 | | | $ | 117,330 | | | $ | 102,382 | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Non-real estate depreciation and amortization | | | 121 | | | | 85 | | | | 448 | | | | 301 | |
| Weather-related losses, net | | | 7 | | | | 107 | | | | 355 | | | | 288 | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | (679 | ) | | | — | |
| Shareholder activism | | | — | | | | — | | | | 393 | | | | — | |
| Non-cash equity compensation | | | 2,506 | | | | 1,768 | | | | 10,615 | | | | 6,807 | |
| Non-recurring income | | | (68 | ) | | | — | | | | (68 | ) | | | — | |
| Non-cash preferred returns on unconsolidated real estate joint ventures | | | (353 | ) | | | (280 | ) | | | (1,291 | ) | | | (980 | ) |
| Adjusted EBITDAre | | $ | 33,036 | | | $ | 29,634 | | | $ | 127,659 | | | $ | 108,914 | |
Bluerock Residential Growth REIT, Inc.
Definitions of Non-GAAP Financial Measures
(Unaudited and dollars in thousands)
Property Net Operating Income ("Property NOI")
We believe that net operating income, or NOI, is a useful measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding depreciation and amortization and interest. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income. We use NOI to evaluate our performance on a same store and non-same store basis; NOI measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as a supplemental measure of our financial performance.
We have acquired seven operating properties, made six property investments through preferred equity interests or mezzanine loans and sold seven operating properties subsequent to December 31, 2018. Therefore, the results presented in the table below are not directly comparable and should not be considered an indication of our future operating performance.
The following table reflects net loss attributable to common stockholders together with a reconciliation to NOI and to same store and non-same store contributions to consolidated NOI, as computed in accordance with GAAP for the periods presented:
| | | Three Months Ended | | | Year Ended | |
| | | December 31, | | | December 31, | |
| | | 2019 | | | 2018 | | | 2019 | | | 2018 | |
| Net loss attributable to common stockholders | | $ | (13,827 | ) | | $ | (12,785 | ) | | $ | (19,751 | ) | | $ | (42,759 | ) |
| Add back: Net loss attributable to Operating Partnership units | | | (5,032 | ) | | | (3,998 | ) | | | (6,779 | ) | | | (12,839 | ) |
| Net loss attributable to common stockholders and unit holders | | | (18,859 | ) | | | (16,783 | ) | | | (26,530 | ) | | | (55,598 | ) |
| Add common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Depreciation and amortization | | | 18,483 | | | | 15,785 | | | | 66,670 | | | | 59,103 | |
| Non-real estate depreciation and amortization | | | 121 | | | | 85 | | | | 448 | | | | 301 | |
| Non-cash interest expense | | | 826 | | | | 780 | | | | 3,174 | | | | 3,757 | |
| Unrealized loss on derivatives | | | 32 | | | | 3,001 | | | | 2,450 | | | | 2,776 | |
| Loss on extinguishment of debt and debt modification costs | | | 335 | | | | — | | | | 7,199 | | | | 2,226 | |
| Property management fees | | | 1,135 | | | | 1,118 | | | | 4,645 | | | | 4,151 | |
| Acquisition and pursuit costs | | | 210 | | | | 37 | | | | 556 | | | | 116 | |
| Corporate operating expenses | | | 5,545 | | | | 5,552 | | | | 22,261 | | | | 19,416 | |
| Weather-related losses, net | | | 7 | | | | 102 | | | | 313 | | | | 280 | |
| Preferred dividends | | | 12,868 | | | | 9,642 | | | | 46,159 | | | | 35,637 | |
| Preferred stock accretion | | | 3,415 | | | | 1,829 | | | | 10,335 | | | | 5,970 | |
| Less common stockholders and Operating Partnership units pro-rata share of: | | | | | | | | | | | | | | | | |
| Other income | | | 68 | | | | — | | | | 68 | | | | — | |
| Preferred returns on unconsolidated real estate joint ventures | | | 2,700 | | | | 2,435 | | | | 9,797 | | | | 10,312 | |
| Interest income from related parties | | | 6,720 | | | | 5,723 | | | | 24,595 | | | | 22,255 | |
| Gain on sale of real estate investments | | | — | | | | — | | | | 48,172 | | | | — | |
| Gain on sale of non-depreciable real estate investments | | | — | | | | — | | | | 679 | | | | — | |
| Pro-rata share of properties’ income | | | 14,630 | | | | 12,990 | | | | 54,369 | | | | 45,568 | |
| Add: | | | | | | | | | | | | | | | | |
| Noncontrolling interest pro-rata share of partially owned property income | | | 724 | | | | 774 | | | | 2,810 | | | | 2,629 | |
| Total property income | | | 15,354 | | | | 13,764 | | | | 57,179 | | | | 48,197 | |
| Add: | | | | | | | | | | | | | | | | |
| Interest expense | | | 12,846 | | | | 13,031 | | | | 53,748 | | | | 46,267 | |
| Net operating income | | | 28,200 | | | | 26,795 | | | | 110,927 | | | | 94,464 | |
| Less: | | | | | | | | | | | | | | | | |
| Non-same store net operating income | | | 6,450 | | | | 5,004 | | | | 35,371 | | | | 23,034 | |
| Same store net operating income(1) | | $ | 21,750 | | | $ | 21,791 | | | $ | 75,556 | | | $ | 71,430 | |
(1) Same store portfolio for the three months ended December 31, 2019 consists of 26 properties, which represent 8,779 units. Same store portfolio for the year ended December 31, 2019 consists of 22 properties, which represent 7,613 units.
