| Forward-Looking Statements |
Some of the statements contained in this presentation constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-Looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions.
The forward-looking statements contained in this presentation reflect Colony Capital, Inc.’s (or “the Company”) current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances, many of which are beyond the Company’s control, that may cause the Company’s actual results to differ significantly from those expressed in any forward-looking statement. Statements regarding the following subjects, among others, may be forward-looking: the market, economic and environmental conditions in the industrial real estate, single-family rental, and lodging sectors; any decrease in the Company’s net income and funds from operations as a result of the combination transaction with Colony Capital, LLC; the Company’s ability to manage the combination with Colony Capital, LLC effectively; the Company’s exposure to risks to which it has not historically been exposed, including liabilities with respect to the assets acquired from Colony Capital, LLC and ongoing liabilities and business risks inherent to Colony Capital LLC’s business; the Company’s business and investment strategy, including the Company’s investment in and ability to generate revenue from the single-family homes in which the Company indirectly owns an interest;; the Company’s ability to dispose of its real estate investments quickly; the performance of the hotels in which the Company owns an interest; market trends in the Company’s industry, interest rates, real estate values, the debt securities markets or the general economy or the demand for commercial real estate loans; the Company’s projected operating results; actions, initiatives and policies of the U.S. government and changes to U.S. government policies and the execution and impact of these actions, initiatives and policies; the state of the U.S. and global economy generally or in specific geographic regions; the Company’s ability to obtain and maintain financing arrangements, including securitizations; the amount and value of commercial mortgage loans requiring refinancing in future periods; the availability of attractive investment opportunities; the availability and cost of debt financing from traditional lenders; the volume of short-term loan extensions; the demand for new capital to replace maturing loans; the Company’s expected leverage; the general volatility of the securities markets in which the Company participates; changes in the value of the Company’s assets; interest rate mismatches between the Company’s target assets and any borrowings used to fund such assets; changes in interest rates and the market value of the Company’s target assets; changes in prepayment rates on the Company’s target assets; effects of hedging instruments on the Company’s target assets; rates of default or decreased recovery rates on the Company’s target assets; the impact of and changes in governmental regulations, tax law and rates, accounting guidance and similar matters; the Company’s ability to maintain its qualification as a real estate investment trust, or REIT, for U.S. federal income tax purposes; the Company’s ability to maintain its exemption from registration as an investment company under the Investment Company Act of 1940, as amended (the “1940 Act”); the availability of opportunities to acquire commercial mortgage-related, real estate-related and other securities; the availability of qualified personnel; estimates relating to the Company’s ability to make distributions to the Company’s stockholders in the future; and the Company’s understanding of its competition.
While forward-looking statements reflect Colony Capital, Inc.’s good faith beliefs, assumptions and expectations, they are not guarantees of future performance. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause the Company’s future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and subsequent filings with the SEC.
This presentation contains statistics and other data that has been obtained from or compiled from information made available by third-party service providers. Colony Capital, Inc. has not independently verified such statistics or data.
Certain of the following slides present information related to the prior performance of Colony Capital, LLC and its affiliates. This information is provided for informational purposes only and is not intended to be indicative of future results. Actual performance of Colony Capital, Inc. may vary materially.
1
| Important Note Regarding Non-GAAP Financial Measures |
This supplemental package includes certain “non-GAAP” supplemental measures that are not defined by generally accepted accounting principles, or GAAP, including funds from operations, or FFO, and core funds from operations, or Core FFO. A description of these non-GAAP financial measures and reconciliations to their most directly comparable GAAP measures, as well as a description of other metrics presented, are provided within the Appendix to this supplemental package. FFO is a non-GAAP measure defined by the National Association of Real Estate Investments Trusts, or NAREIT.
2
| Table of Contents |
| Page | Page | |||||||
| I. | Overview | V. | Single Family Residential Rentals | |||||
| a. | Summary Metrics | a. | Summary Metrics | |||||
| b. | Summary of Segments | VI. | Other Real Estate Equity | |||||
| II. | Financial Results | a. | Summary Metrics | |||||
| a. | Consolidated Income Statements | b. | Summary of Assets | |||||
| b. | Pro Rata Segment Balance Sheets | VII. | Real Estate Debt | |||||
| c. | Pro Rata Segment Operating Results | a. | Summary Metrics | |||||
| d. | Pro Rata Segment Reconciliation of Net Income to FFO & Core FFO | b. | Portfolio Overview | |||||
| III. | Capitalization | VIII. | Investment Management | |||||
| a. | Overview | a. | Summary Metrics | |||||
| b. | Debt Overview | IX. | Definitions | |||||
| c. | Credit Facility, Convertible Debt & Preferred Equity Overview | |||||||
| IV. | Colony Light Industrial Platform | |||||||
| a. | Summary Metrics | |||||||
| b. | Portfolio & Lease Overview | |||||||
3
I. Overview
| Ia. Overview—Summary Metrics |
| Summary Metrics | |||
| ($ in thousands, except per share data, unless otherwise noted; as of or for the three months ended December 31, 2015) | |||
| Financial data | |||
| Core FFO attributable to common interests in OP and common stockholders | $ | 76,698 | |
| Core FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.57 | ||
| FFO attributable to common interests in OP and common stockholders | 54,272 | ||
| FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.41 | ||
| Net income attributable to common interests in OP and common stockholders | 22,340 | ||
| Net income attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.17 | ||
| 1Q16 Dividend per share | 0.40 | ||
| Annualized dividend | 1.60 | ||
| AUM | $18.8 billion | ||
| FEEUM | $9.3 billion | ||
| Balance sheet, capitalization and trading statistics | |||
| Total consolidated assets | $ | 10,039,310 | |
| CLNY & OP share of consolidated assets | 6,916,528 | ||
Total consolidated debt (1) | 4,237,439 | ||
| CLNY & OP share of consolidated debt | 3,294,650 | ||
| Shares and OP units outstanding | 133,989 | ||
| Share price as of 12/31/2015 | $ | 19.48 | |
| Market value of common equity & OP units as of 12/31/2015 | 2,610,106 | ||
| Liquidation preference of preferred equity | 625,750 | ||
| Insider ownership of shares and OP units | 18.8 | % | |
__________
Note: See appendix for definitions and acronyms.
(1) Represents principal balance and excludes debt issuance costs, discounts and premiums.
5
| Ib. Overview—Summary of Segments |
| ($ in thousands, unless otherwise noted; as of or for the three months ended December 31, 2015) | |||
| Light Industrial | |||
CLNY & OP share of real estate & related assets, net (1) | $ | 1,154,516 | |
| CLNY & OP share of investment-level non-recourse financing (principal balance) | 694,261 | ||
| Carrying value of CLIP operating platform | 20,000 | ||
| Core FFO attributable to common interests in OP and common stockholders | 15,117 | ||
| Single Family Residential Rentals | |||
| Investment in unconsolidated joint ventures | $ | 394,783 | |
| CLNY & OP share of cost basis | 444,336 | ||
| CLNY & OP share of Colony American Finance net book value (included in investments in unconsolidated joint ventures above) | 57,343 | ||
| Colony Starwood Homes shares beneficially owned by OP and common stockholders as of 1/5/2016 | 15.1 million | ||
Core FFO attributable to common interests in OP and common stockholders | 6,032 | ||
| Other Real Estate Equity | |||
CLNY & OP share of real estate and related assets, net, held for investment (1) | $ | 900,238 | |
| CLNY & OP share of investment-level non-recourse financing for real estate and related assets, net, held for investment (principal balance) | 583,230 | ||
CLNY & OP share of real estate and related assets, net, held for sale (1) | 71,959 | ||
| CLNY & OP share of investments in unconsolidated joint ventures excluding Albertsons investment | 144,925 | ||
| CLNY & OP share of investments in unconsolidated joint ventures - Albertsons investment | 49,934 | ||
Core FFO attributable to common interests in OP and common stockholders | 15,688 | ||
| Real Estate Debt | |||
| CLNY & OP share of loans held for investment, net and held for sale, net | $ | 2,848,753 | |
| CLNY & OP share of investment-level non-recourse financing (principal balance) | 1,056,676 | ||
CLNY & OP share of real estate & related assets, net (REO within debt portfolio) (1) | 33,577 | ||
| CLNY & OP share of investments in unconsolidated joint ventures | 122,331 | ||
Core FFO attributable to common interests in OP and common stockholders | 69,815 | ||
| Investment Management | |||
| AUM | $18.8 billion | ||
| FEEUM | $9.3 billion | ||
| Credit Funds | $3.6 billion | ||
| Core Plus / Value-Add Funds | $1.9 billion | ||
| Opportunity Funds | $3.8 billion | ||
| Core FFO attributable to common interests in OP and common stockholders | $ | 11,559 | |
__________
(1) Includes all components related to the asset, including real estate and lease-related intangibles.
6
II. Financial Results
| IIa. Financial Results—Consolidated Income Statements |
| 2015 | |||||||||||||||
| ($ in thousands, except per share data) | Q1 | Q2 | Q3 | Q4 | |||||||||||
| Income | |||||||||||||||
| Interest income | $ | 46,137 | $ | 101,270 | $ | 142,269 | $ | 127,629 | |||||||
| Property operating income | 43,793 | 83,230 | 86,435 | 86,413 | |||||||||||
| Equity in income of unconsolidated joint ventures | 26,349 | 10,956 | 6,879 | 3,421 | |||||||||||
| Fee income | — | 21,928 | 23,070 | 20,745 | |||||||||||
| Other income | 333 | 3,520 | 4,325 | 3,274 | |||||||||||
| Total income | 116,612 | 220,904 | 262,978 | 241,482 | |||||||||||
| Expenses | |||||||||||||||
| Management fees | 14,961 | 101 | — | — | |||||||||||
| Transaction, investment and servicing expenses | 16,807 | 10,034 | 7,058 | 28,722 | |||||||||||
| Interest expense | 26,593 | 30,924 | 38,027 | 37,550 | |||||||||||
| Property operating expenses | 14,011 | 35,905 | 35,615 | 32,182 | |||||||||||
| Depreciation and amortization | 22,308 | 36,645 | 42,656 | 39,368 | |||||||||||
| Provision for loan losses | — | 4,078 | 26,495 | 6,538 | |||||||||||
| Impairment | — | — | 317 | 10,425 | |||||||||||
| Compensation expense | — | 28,644 | 25,734 | 29,513 | |||||||||||
| Administrative expenses | 4,781 | 11,411 | 11,154 | 11,507 | |||||||||||
| Total expenses | 99,461 | 157,742 | 187,056 | 195,805 | |||||||||||
| Gain on remeasurement of consolidated investment entities, net | — | 41,486 | — | — | |||||||||||
| Other (loss) gain, net | (286 | ) | (1,215 | ) | (759 | ) | 5,602 | ||||||||
| Income before income taxes | 16,865 | 103,433 | 75,163 | 51,279 | |||||||||||
| Income tax (provision) benefit | (650 | ) | (349 | ) | 3,598 | 6,697 | |||||||||
| Net income | 16,215 | 103,084 | 78,761 | 57,976 | |||||||||||
| Net income attributable to noncontrolling interests—Investment entities | 5,686 | 34,630 | 22,264 | 23,543 | |||||||||||
| Net income attributable to noncontrolling interests—Operating Company | — | 9,138 | 7,200 | 3,595 | |||||||||||
| Net income attributable to Colony Capital, Inc. | 10,529 | 59,316 | 49,297 | 30,838 | |||||||||||
| Preferred dividends | 6,972 | 11,410 | 12,094 | 12,093 | |||||||||||
| Net income attributable to common stockholders | $ | 3,557 | $ | 47,906 | $ | 37,203 | $ | 18,745 | |||||||
| Net income per common share—Basic | $ | 0.03 | $ | 0.43 | $ | 0.33 | $ | 0.17 | |||||||
| Net income per common share—Diluted | $ | 0.03 | $ | 0.40 | $ | 0.32 | $ | 0.17 | |||||||
| Weighted average number of common shares outstanding—Basic | 109,415 | 111,394 | 111,443 | 111,444 | |||||||||||
| Weighted average number of common shares outstanding—Diluted | 109,415 | 136,434 | 136,138 | 111,444 | |||||||||||
| FFO attributable to common interests in OP and common stockholders | $ | 29,663 | $ | 83,159 | $ | 72,162 | $ | 54,272 | |||||||
| FFO per basic common share / common OP Unit | $ | 0.27 | $ | 0.62 | $ | 0.54 | $ | 0.41 | |||||||
| Core FFO attributable to common interests in OP and common stockholders | $ | 53,561 | $ | 59,409 | (1) | $ | 70,776 | (1) | $ | 76,698 | |||||
| Core FFO per basic common share / common OP Unit | $ | 0.49 | $ | 0.45 | (1) | $ | 0.53 | (1) | $ | 0.57 | |||||
__________
(1) During the current quarter ended December 31, 2015, we added the deferred tax effect related to amortization and impairment of investment management contracts and customer relationships to the definition of Core FFO. As such, we have presented revised Core FFO and Core FFO per basic common share / common OP Unit from prior periods to exclude such deferred tax effects to conform to the current quarter calculation of Core FFO.
8
| IIb. Financial Results—Pro Rata Segment Balance Sheets |
| OP Pro Rata Share by Segment | Amounts Attributable to Noncontrolling Interests | CLNY Consolidated As Reported | |||||||||||||||||||||||||||||||||
| (In thousands; as of December 31, 2015) | Light Industrial Platform | Single-Family Residential Rentals | Other Real Estate Equity | Real Estate Debt | Investment Management | Amounts not allocated to segments | Total OP Pro Rata Share | ||||||||||||||||||||||||||||
| ASSETS | |||||||||||||||||||||||||||||||||||
| Cash | $ | 7,607 | $ | — | $ | 31,637 | $ | 34,539 | $ | 28,499 | $ | 13,592 | $ | 115,874 | $ | 69,980 | $ | 185,854 | |||||||||||||||||
| Loan receivable | |||||||||||||||||||||||||||||||||||
| Held for investment | — | — | — | 2,833,861 | — | — | 2,833,861 | 1,214,616 | 4,048,477 | ||||||||||||||||||||||||||
| Held for sale | — | — | — | 14,892 | — | — | 14,892 | 60,110 | 75,002 | ||||||||||||||||||||||||||
| Real estate assets, net | |||||||||||||||||||||||||||||||||||
| Held for investment | 1,107,081 | — | 821,475 | 13,064 | — | — | 1,941,620 | 1,190,598 | 3,132,218 | ||||||||||||||||||||||||||
| Held for sale | 3,832 | — | 65,606 | 20,458 | — | — | 89,896 | 207,991 | 297,887 | ||||||||||||||||||||||||||
| Investments in unconsolidated joint ventures | — | 394,783 | 194,859 | 122,331 | 9,794 | 10,449 | 732,216 | 192,249 | 924,465 | ||||||||||||||||||||||||||
| Goodwill | 20,000 | — | — | — | 658,267 | — | 678,267 | — | 678,267 | ||||||||||||||||||||||||||
| Deferred leasing costs and intangible assets, net | 51,342 | — | 89,469 | 55 | 87,704 | — | 228,570 | 96,943 | 325,513 | ||||||||||||||||||||||||||
| Other assets | 25,915 | — | 22,943 | 151,595 | 13,949 | 66,930 | 281,332 | 90,295 | 371,627 | ||||||||||||||||||||||||||
| Total assets | $ | 1,215,777 | $ | 394,783 | $ | 1,225,989 | $ | 3,190,795 | $ | 798,213 | $ | 90,971 | $ | 6,916,528 | $ | 3,122,782 | $ | 10,039,310 | |||||||||||||||||
| LIABILITIES & EQUITY | |||||||||||||||||||||||||||||||||||
| Liabilities: | |||||||||||||||||||||||||||||||||||
| Accrued and other liabilities | $ | 27,810 | $ | — | $ | 57,651 | $ | 109,432 | $ | 45,406 | $ | 13,186 | $ | 253,485 | $ | 47,582 | $ | 301,067 | |||||||||||||||||
| Intangible liabilities | 7,739 | — | 4,353 | — | — | — | 12,092 | 12,430 | 24,522 | ||||||||||||||||||||||||||
| Due to affiliates—contingent consideration | — | — | — | — | — | 52,990 | 52,990 | — | 52,990 | ||||||||||||||||||||||||||
| Dividends and distributions payable | — | — | — | — | — | 65,688 | 65,688 | — | 65,688 | ||||||||||||||||||||||||||
| Debt, net | 685,059 | — | 573,287 | 1,047,550 | — | 357,983 | 2,663,879 | 923,845 | 3,587,724 | ||||||||||||||||||||||||||
| Convertible senior notes, net | — | — | — | — | — | 591,079 | 591,079 | — | 591,079 | ||||||||||||||||||||||||||
| Total liabilities | 720,608 | — | 635,291 | 1,156,982 | 45,406 | 1,080,926 | 3,639,213 | 983,857 | 4,623,070 | ||||||||||||||||||||||||||
| Equity: | |||||||||||||||||||||||||||||||||||
| Stockholders' equity | 430,140 | 342,938 | 513,124 | 1,766,719 | 653,941 | (859,946 | ) | 2,846,916 | — | 2,846,916 | |||||||||||||||||||||||||
| Noncontrolling interests in investment entities | — | — | — | — | — | — | — | 2,138,925 | 2,138,925 | ||||||||||||||||||||||||||
| Noncontrolling interests in Operating Company | 65,029 | 51,845 | 77,574 | 267,094 | 98,866 | (130,009 | ) | 430,399 | — | 430,399 | |||||||||||||||||||||||||
| Total equity | 495,169 | 394,783 | 590,698 | 2,033,813 | 752,807 | (989,955 | ) | 3,277,315 | 2,138,925 | 5,416,240 | |||||||||||||||||||||||||
| Total liabilities and equity | $ | 1,215,777 | $ | 394,783 | $ | 1,225,989 | $ | 3,190,795 | $ | 798,213 | $ | 90,971 | $ | 6,916,528 | $ | 3,122,782 | $ | 10,039,310 | |||||||||||||||||
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| IIc. Financial Results—Pro Rata Segment Operating Results |
| OP Pro Rata Share by Segment | Amounts Attributable to Noncontrolling Interests | CLNY Consolidated As Reported | |||||||||||||||||||||||||||||||||
| (In thousands; for the three months ended December 31, 2015) | Light Industrial Platform | Single-Family Residential Rentals | Other Real Estate Equity | Real Estate Debt | Investment Management | Amounts not allocated to segments | Total OP Pro Rata Share | ||||||||||||||||||||||||||||
| Income | |||||||||||||||||||||||||||||||||||
| Interest income | $ | — | $ | — | $ | 2 | $ | 77,140 | $ | — | $ | 22 | $ | 77,164 | $ | 50,465 | $ | 127,629 | |||||||||||||||||
| Property operating income | 27,945 | — | 22,567 | 529 | — | — | 51,041 | 35,372 | 86,413 | ||||||||||||||||||||||||||
| Equity in income (loss) of unconsolidated joint ventures | — | (5,086 | ) | 4,146 | 2,854 | (1,286 | ) | (655 | ) | (27 | ) | 3,448 | 3,421 | ||||||||||||||||||||||
| Fee income | — | — | — | — | 20,745 | — | 20,745 | — | 20,745 | ||||||||||||||||||||||||||
| Other income | 3,101 | — | 32 | 449 | — | 1,327 | 4,909 | (1,635 | ) | 3,274 | |||||||||||||||||||||||||
| Total income | 31,046 | (5,086 | ) | 26,747 | 80,972 | 19,459 | 694 | 153,832 | 87,650 | 241,482 | |||||||||||||||||||||||||
| Expenses | |||||||||||||||||||||||||||||||||||
| Transaction, investment and servicing expenses | 203 | — | 4,414 | 2,402 | — | 950 | 7,969 | 20,753 | 28,722 | ||||||||||||||||||||||||||
| Interest expense | 5,976 | — | 4,705 | 9,183 | — | 10,980 | 30,844 | 6,706 | 37,550 | ||||||||||||||||||||||||||
| Property operating expenses | 8,584 | — | 6,529 | 536 | — | — | 15,649 | 16,533 | 32,182 | ||||||||||||||||||||||||||
| Depreciation and amortization | 13,239 | — | 7,303 | 24 | 5,264 | 1,206 | 27,036 | 12,332 | 39,368 | ||||||||||||||||||||||||||
| Provision for loan losses | — | — | — | 1,818 | — | — | 1,818 | 4,720 | 6,538 | ||||||||||||||||||||||||||
| Impairment loss | — | — | 1,272 | 673 | 4,103 | — | 6,048 | 4,377 | 10,425 | ||||||||||||||||||||||||||
| Compensation expense | 840 | — | 771 | 3,839 | 10,755 | 12,019 | 28,224 | 1,289 | 29,513 | ||||||||||||||||||||||||||
| Administrative expenses | 317 | — | 310 | 685 | 224 | 8,977 | 10,513 | 994 | 11,507 | ||||||||||||||||||||||||||
| Total expenses | 29,159 | — | 25,304 | 19,160 | 20,346 | 34,132 | 128,101 | 67,704 | 195,805 | ||||||||||||||||||||||||||
| Gain (loss) on sale of real estate assets, net | (350 | ) | — | 605 | 328 | — | — | 583 | 1,907 | 2,490 | |||||||||||||||||||||||||
| Other gain (loss), net | (8 | ) | — | 540 | (159 | ) | 4 | 812 | 1,189 | 1,923 | 3,112 | ||||||||||||||||||||||||
| Income before income taxes | 1,529 | (5,086 | ) | 2,588 | 61,981 | (883 | ) | (32,626 | ) | 27,503 | 23,776 | 51,279 | |||||||||||||||||||||||
| Income tax benefit (expense) | 28 | — | 147 | 832 | 5,926 | (3 | ) | 6,930 | (233 | ) | 6,697 | ||||||||||||||||||||||||
| Net income | 1,557 | (5,086 | ) | 2,735 | 62,813 | 5,043 | (32,629 | ) | 34,433 | 23,543 | 57,976 | ||||||||||||||||||||||||
| Net income attributable to noncontrolling interests: | |||||||||||||||||||||||||||||||||||
| Investment entities | — | — | — | — | — | — | — | 23,543 | 23,543 | ||||||||||||||||||||||||||
| Operating Company | — | — | — | — | — | — | — | 3,595 | 3,595 | ||||||||||||||||||||||||||
| Net income attributable to Colony Capital, Inc. | 1,557 | (5,086 | ) | 2,735 | 62,813 | 5,043 | (32,629 | ) | 34,433 | (3,595 | ) | 30,838 | |||||||||||||||||||||||
| Preferred dividends | — | — | — | — | — | 12,093 | 12,093 | — | 12,093 | ||||||||||||||||||||||||||
| Net income attributable to common stockholders | $ | 1,557 | $ | (5,086 | ) | $ | 2,735 | $ | 62,813 | $ | 5,043 | $ | (44,722 | ) | $ | 22,340 | $ | (3,595 | ) | $ | 18,745 | ||||||||||||||
10
| IId. Financial Results—Pro Rata Segment Reconciliation of Net Income to FFO & Core FFO |
| OP Pro Rata Share by Segment | Amounts Attributable to Noncontrolling Interests | CLNY Consolidated As Reported | |||||||||||||||||||||||||||||||||
| (In thousands; for the three months ended December 31, 2015) | Light Industrial Platform | Single-Family Residential Rentals | Other Real Estate Equity | Real Estate Debt | Investment Management | Amounts not allocated to segments | Total OP Pro Rata Share | ||||||||||||||||||||||||||||
| Net income (loss) attributable to Operating Company, noncontrolling interests in Operating Company and common stockholders | $ | 1,557 | $ | (5,086 | ) | $ | 2,735 | $ | 62,813 | $ | 5,043 | $ | (44,722 | ) | $ | 22,340 | $ | (3,595 | ) | $ | 18,745 | ||||||||||||||
| Adjustments for FFO attributable to common interests in Operating Company: | |||||||||||||||||||||||||||||||||||
| Net income attributable to noncontrolling common interests in Operating Company | — | — | — | — | — | — | — | 3,595 | 3,595 | ||||||||||||||||||||||||||
| Real estate depreciation and amortization | 13,239 | 6,533 | 8,453 | 24 | — | — | 28,249 | 12,451 | 40,700 | ||||||||||||||||||||||||||
| Impairment of real estate | — | 2,500 | 1,272 | 673 | — | — | 4,445 | 4,345 | 8,790 | ||||||||||||||||||||||||||
| Loss (gain) on sales of real estate | 350 | (179 | ) | (605 | ) | (328 | ) | — | — | (762 | ) | (1,911 | ) | (2,673 | ) | ||||||||||||||||||||
| Less: Adjustments attributable to noncontrolling interests in investment entities | — | — | — | — | — | — | — | (14,885 | ) | (14,885 | ) | ||||||||||||||||||||||||
| FFO attributable to common interests in Operating Company and common stockholders | $ | 15,146 | $ | 3,768 | $ | 11,855 | $ | 63,182 | $ | 5,043 | $ | (44,722 | ) | $ | 54,272 | $ | — | $ | 54,272 | ||||||||||||||||
| Additional adjustments for Core FFO attributable to common interests in Operating Company and common stockholders: | |||||||||||||||||||||||||||||||||||
| Gain (loss) on sale of real estate, net of depreciation and amortization previously adjusted for FFO | (510 | ) | (49 | ) | 604 | 267 | — | — | 312 | 1,554 | 1,866 | ||||||||||||||||||||||||
| Noncash equity compensation expense | — | — | 47 | 134 | 667 | 1,620 | 2,468 | — | 2,468 | ||||||||||||||||||||||||||
| Straight-line rent revenue | (1,189 | ) | 46 | (1,288 | ) | — | — | — | (2,431 | ) | (862 | ) | (3,293 | ) | |||||||||||||||||||||
| Gain on change in fair value of contingent consideration | — | — | — | — | — | (750 | ) | (750 | ) | — | (750 | ) | |||||||||||||||||||||||
| Amortization of acquired above-and below-market lease intangibles, net | 464 | — | (547 | ) | — | — | — | (83 | ) | 260 | 177 | ||||||||||||||||||||||||
| Amortization of deferred financing costs and debt premium and discounts | 1,010 | 1,120 | 520 | 2,078 | — | 1,133 | 5,861 | 1,004 | 6,865 | ||||||||||||||||||||||||||
| Unrealized gain on derivatives | — | (899 | ) | (2,844 | ) | — | (5 | ) | — | (3,748 | ) | — | (3,748 | ) | |||||||||||||||||||||
| Acquisition-related expenses | 196 | 2,046 | 4,001 | 120 | — | — | 6,363 | 16,567 | 22,930 | ||||||||||||||||||||||||||
| Amortization and impairment of investment management intangibles | — | — | — | — | 9,367 | — | 9,367 | — | 9,367 | ||||||||||||||||||||||||||
| Deferred tax benefit effect on amortization and impairment of investment management intangibles | — | — | — | — | (3,513 | ) | — | (3,513 | ) | — | (3,513 | ) | |||||||||||||||||||||||
| Non-real estate depreciation and amortization | — | — | — | — | — | 1,206 | 1,206 | — | 1,206 | ||||||||||||||||||||||||||
| Amortization of gain on remeasurement of consolidated investment entities, net | — | — | 3,340 | 4,034 | — | — | 7,374 | 22,199 | 29,573 | ||||||||||||||||||||||||||
| Less: Adjustments attributable to noncontrolling interests in investment entities | — | — | — | — | — | — | — | (40,722 | ) | (40,722 | ) | ||||||||||||||||||||||||
| Core FFO attributable to common interests in Operating Company and common stockholders | $ | 15,117 | $ | 6,032 | $ | 15,688 | $ | 69,815 | $ | 11,559 | $ | (41,513 | ) | $ | 76,698 | $ | — | $ | 76,698 | ||||||||||||||||
11
III. Capitalization
| IIIa. Capitalization—Overview |
| ($ in thousands, except share and per share data; as of December 31, 2015) | |||||||||
| Debt | |||||||||
| $800,000 Revolving credit facility | $ | 315,000 | |||||||
| 5.0% Convertible senior notes due 2023 | 200,000 | ||||||||
| 3.875% Convertible senior notes due 2021 | 402,500 | ||||||||
| Corporate aircraft promissory note | 42,983 | ||||||||
| CLNY & OP share of investment-level debt | 2,334,167 | ||||||||
| Total CLNY & OP share of debt | 3,294,650 | ||||||||
| Preferred Equity | |||||||||
| Series A 8.5% cumulative redeemable perpetual preferred stock, redemption value | 252,000 | ||||||||
| Series B 7.5% cumulative redeemable perpetual preferred stock, redemption value | 86,250 | ||||||||
| Series C 7.125% cumulative redeemable perpetual preferred stock, redemption value | 287,500 | ||||||||
| Total redemption value of preferred equity | 625,750 | ||||||||
| Common Equity | Price per share | Shares / Units | |||||||
| Class A common stock | 19.48 | 111,694 | 2,175,799 | ||||||
| Class B common stock | 19.48 | 546 | 10,636 | ||||||
| OP units | 19.48 | 21,749 | 423,671 | ||||||
| Total market value of common equity | 2,610,106 | ||||||||
| Total capitalization | $ | 6,530,506 | |||||||
13
| IIIb. Capitalization—Debt Overview |
| Debt overview | ||||||||||||
| ($ in thousands; as of December 31, 2015) | Type | Weighted-average years remaining to maturity (1) | Weighted-average interest rate | CLNY & OP pro rata share of unpaid principal balance | ||||||||
| Non-recourse debt | ||||||||||||
| Light Industrial Platform | Secured | 3.9 | 2.79 | % | $ | 694,261 | ||||||
| Other Real Estate Equity | Secured | 8.2 | 3.35 | % | 583,230 | |||||||
| Real Estate Debt | Secured | 17.9 | 2.63 | % | 895,014 | |||||||
| Total non-recourse debt | 10.8 | 2.92 | % | 2,172,505 | ||||||||
| Recourse debt | ||||||||||||
| Line of credit | Secured | 2.6 | 3.11 | % | 315,000 | |||||||
| 5.0% Convertible senior notes | Unsecured | 7.4 | 5.00 | % | 200,000 | |||||||
| 3.875% Convertible senior notes | Unsecured | 5.1 | 3.88 | % | 402,500 | |||||||
| February 2014 warehouse facility | Secured | 1.1 | 2.61 | % | 47,229 | |||||||
| April 2015 warehouse facility (25% recourse) | Secured | 2.3 | 3.06 | % | 114,433 | |||||||
| Corporate aircraft promissory note | Secured | 10.1 | 5.02 | % | 42,983 | |||||||
| Total recourse debt | 4.6 | 3.77 | % | 1,122,145 | ||||||||
| Total debt outstanding | 8.7 | 3.14 | % | $ | 3,294,650 | |||||||
Debt maturity and amortization schedule(1) | |||||||||||||||||||||||||||
| Payments due by Period | |||||||||||||||||||||||||||
| ($ in thousands; as of December 31, 2015) | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 and after | Total | ||||||||||||||||||||
| Line of credit | $ | 65,625 | $ | 157,500 | $ | 91,875 | $ | — | $ | — | $ | — | $ | 315,000 | |||||||||||||
| Convertible senior notes | — | — | — | — | — | 602,500 | 602,500 | ||||||||||||||||||||
| Warehouse facilities | — | 47,229 | 114,433 | — | — | — | 161,662 | ||||||||||||||||||||
| Corporate aircraft promissory note | 1,835 | 1,930 | 2,029 | 2,134 | 2,244 | 32,811 | 42,983 | ||||||||||||||||||||
| CMBS securitization debt | — | — | — | — | — | 802,647 | 802,647 | ||||||||||||||||||||
| Scheduled amortization payments on investment-level debt | 5,149 | 5,703 | 5,770 | 5,361 | 5,423 | 37,658 | 65,064 | ||||||||||||||||||||
| Balloon payments on investment-level debt | 48,058 | 81,565 | 688,177 | 29,167 | — | 457,827 | 1,304,794 | ||||||||||||||||||||
| Total | $ | 120,667 | $ | 293,927 | $ | 902,284 | $ | 36,662 | $ | 7,667 | $ | 1,933,443 | $ | 3,294,650 | |||||||||||||
__________
(1) Based on initial maturity dates or extended maturity dates to the extent criteria are met and the extension option is at the borrower's discretion.
14
| IIIc. Capitalization—Credit Facility, Convertible Debt & Preferred Stock Overview |
| ($ and shares in thousands; as of or for the three months ended December 31, 2015) | |||||||||||||||||||||||
| Credit facility | |||||||||||||||||||||||
| Revolving credit facility | |||||||||||||||||||||||
| Maximum principal amount | $ | 800,000 | |||||||||||||||||||||
| Amount outstanding | 315,000 | ||||||||||||||||||||||
| Initial maturity | August 6, 2016 | ||||||||||||||||||||||
| Fully-extended maturity | August 6, 2018 | ||||||||||||||||||||||
| Interest rate | LIBOR + 2.75% | ||||||||||||||||||||||
| Covenant level | Actual level at December 31, 2015 | ||||||||||||||||||||||
| Financial covenants as defined in the Credit Agreement: | |||||||||||||||||||||||
| Consolidated Tangible Net Worth | Minimum $1,927 million | $2,339 million | |||||||||||||||||||||
| Consolidated Fixed Charge Coverage Ratio | Minimum 1.50x | 2.34 to 1.0 | |||||||||||||||||||||
| Consolidated Leverage Ratio | Maximum 65% | 0.41 to 1.0 | |||||||||||||||||||||
| Liquidity | Minimum $5 million | $599 million | |||||||||||||||||||||
| Convertible debt | |||||||||||||||||||||||
| Description | Outstanding principal | Issuance date | Due date | Interest rate | Conversion price (per share of common stock) | Conversion shares | Redemption date | ||||||||||||||||
| 5.0% Convertible Senior Notes | $ | 200,000 | April 2013 | April 15, 2023 | 5.00% fixed | $ | 23.60 | 8,475 | On or after April 22, 2020 | ||||||||||||||
| 3.875% Convertible Senior Notes | 402,500 | January and June 2014 | January 15, 2021 | 3.875% fixed | $ | 24.82 | 16,217 | On or after January 22, 2019 | |||||||||||||||
| $ | 602,500 | ||||||||||||||||||||||
| Preferred stock | |||||||||||||||||||||||
| Description | Liquidation preference | Initial issuance date | Dividend rate | Shares outstanding | Redemption period | ||||||||||||||||||
| Series A 8.5% cumulative redeemable perpetual | $ | 252,000 | March 2012 | 8.50% | 10,080 | On or after March 27, 2017 | |||||||||||||||||
| Series B 7.5% cumulative redeemable perpetual | 86,250 | June 2014 | 7.50% | 3,450 | On or after June 19, 2019 | ||||||||||||||||||
| Series C 7.125% cumulative redeemable perpetual | 287,500 | April 2015 | 7.125% | 11,500 | On or after April 13, 2020 | ||||||||||||||||||
| $ | 625,750 | 25,030 | |||||||||||||||||||||
15
IV. Colony Light Industrial Platform
| IVa. CLIP—Summary Metrics |
| ($ in thousands, except per share; as of or for the three months ended December 31, 2015) | |||||||||||||||||||
| Financial results related to the segment | |||||||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders | $ | 15,117 | |||||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.11 | ||||||||||||||||||
| FFO attributable to common interests in OP and common stockholders | 15,146 | ||||||||||||||||||
| FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.11 | ||||||||||||||||||
| Portfolio overview | |||||||||||||||||||
| Number of buildings | 325 | ||||||||||||||||||
| Rentable square feet | 34,738 | ||||||||||||||||||
| % leased at end of period | 93.0 | % | |||||||||||||||||
| Total goodwill associated with management platform (CLNY & OP owns 100%) | $ | 20,000 | |||||||||||||||||
| Uncalled third party capital commitments | 61,300 | ||||||||||||||||||
| Investment-level non-recourse financing | |||||||||||||||||||
Initial maturity date | Fully extended maturity date | Interest rate | Maximum principal amount | CLNY & OP pro rata share of unpaid principal balance | |||||||||||||||
| CLIP acquisition financing | Dec-2016 | Dec-2019 | L + 2.25% | (1) | N/A | $ | 575,422 | ||||||||||||
| CLIP fixed rate mortgage | Aug-2025 | Aug-2025 | 3.80 | % | N/A | 103,956 | |||||||||||||
| CLIP credit facility | Jul-2016 | Jul-2016 | L + 2.25% | 100,000 | 14,883 | ||||||||||||||
| Total debt | 694,261 | ||||||||||||||||||
| Debt issuance costs | (9,202 | ) | |||||||||||||||||
| Total debt net of debt issuance | $ | 685,059 | |||||||||||||||||
| CLNY & OP share of undepreciated cost basis of real estate assets (excluding accumulated depreciation) | $ | 1,217,725 | |||||||||||||||||
| CLNY & OP share of debt / undepreciated cost basis | 57.0 | % | |||||||||||||||||
| Recent acquisitions | |||||||||||||||||||
| Property / portfolio name | Acquisition date | Number of buildings | Rentable square feet | % leased | Purchase price | ||||||||||||||
| Q4 2015 acquisitions | |||||||||||||||||||
| Atlanta Light Industrial Building | Oct -2015 | 1 | 130,462 | 100 | % | $ | 10,300 | ||||||||||||
| Phoenix Light Industrial Portfolio | Nov-2015 | 3 | 407,461 | 84 | % | 32,150 | |||||||||||||
| Phoenix Light Industrial Portfolio | Dec-2015 | 4 | 336,615 | 100 | % | 36,450 | |||||||||||||
| Phoenix Light Industrial Building | Dec-2015 | 1 | 236,007 | 100 | % | 18,000 | |||||||||||||
| Total | 9 | 1,110,545 | 96 | % | $ | 96,900 | |||||||||||||
| Q1 2016 acquisitions | |||||||||||||||||||
| Baltimore Light Industrial Portfolio | Feb-2016 | 2 | 200,560 | 100 | % | $ | 17,625 | ||||||||||||
| Total | 2 | 200,560 | 100 | % | $ | 17,625 | |||||||||||||
__________
(1) Interest rate increases to 1-month LIBOR plus 2.5% after fourth anniversary date.
17
| IVb. CLIP—Portfolio and Lease Overview |
| Location | Property Type | Number of Buildings | Rentable Square Feet (in thousands) | Annualized Base Rent (in thousands) | Percentage Leased | Number of Leases | Lease Expiration | Year Acquired | ||||||||||||||
| United States | ||||||||||||||||||||||
| Arizona | Industrial | 18 | 1,701 | $ | 4,281 | 90 | % | 48 | 1/2016 to 8/2024 | 2014 | ||||||||||||
| Colorado | Industrial | 8 | 1,128 | 4,312 | 100 | % | 25 | 5/2016 to 3/2023 | 2014 | |||||||||||||
| Florida | Industrial | 12 | 1,173 | 5,300 | 91 | % | 37 | 1/2016 to 1/2024 | 2014 | |||||||||||||
| Georgia | Industrial | 85 | 8,355 | 31,455 | 95 | % | 234 | 1/2016 to 4/2030 | 2014-2015 | |||||||||||||
| Illinois | Industrial | 33 | 3,828 | 15,893 | 94 | % | 55 | 1/2016 to 12/2026 | 2014 | |||||||||||||
| Kansas | Industrial | 1 | 172 | 743 | 100 | % | 1 | 11/30/2024 | 2014 | |||||||||||||
| Maryland | Industrial | 3 | 230 | 1,069 | 100 | % | 7 | 7/2016 to 8/2021 | 2015 | |||||||||||||
| Minnesota | Industrial | 15 | 1,993 | 8,841 | 89 | % | 56 | 1/2016 to 10/2025 | 2014-2015 | |||||||||||||
| Missouri | Industrial | 16 | 2,847 | 9,474 | 91 | % | 40 | 2/2016 to 7/2024 | 2014 | |||||||||||||
| New Jersey | Industrial | 22 | 1,343 | 5,797 | 91 | % | 49 | 3/2016 to 10/2024 | 2014 - 2015 | |||||||||||||
| Pennsylvania | Industrial | 8 | 1,985 | 8,172 | 92 | % | 21 | 2/2016 to 1/2026 | 2014 - 2015 | |||||||||||||
| Tennessee | Industrial | 3 | 383 | 138 | 45 | % | 3 | 2/2017 to 3/2019 | 2014 | |||||||||||||
| Texas | Industrial | 84 | 8,187 | 32,013 | 94 | % | 213 | 1/2016 to 4/2040 | 2014 - 2015 | |||||||||||||
| Utah | Industrial | 16 | 1,269 | 5,605 | 100 | % | 33 | 2/2016 to 11/2023 | 2014 | |||||||||||||
| Wisconsin | Industrial | 1 | 144 | 719 | 100 | % | 1 | 10/2022 | 2014 | |||||||||||||
| Total | 325 | 34,738 | $ | 133,812 | 93 | % | 823 | |||||||||||||||
18
V. Single Family Residential Rentals
| Va. Single Family Residential Rentals—Summary Metrics |
| ($ in thousands, except per share, unless otherwise noted; as of or for the three months ended December 31, 2015) | ||||||||||||||||
| Financial results related to the segment | ||||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders | $ | 6,032 | ||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.05 | |||||||||||||||
| FFO attributable to common interests in OP and common stockholders | 3,768 | |||||||||||||||
| FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.03 | |||||||||||||||
| Balance sheet | ||||||||||||||||
| Investments in unconsolidated joint ventures | $ | 394,783 | ||||||||||||||
| CLNY & OP Share of Colony American Finance net book value (included in investments in unconsolidated joint ventures above) | 57,343 | |||||||||||||||
| Cost basis | ||||||||||||||||
| CLNY & OP original cost basis of Colony American Homes | $ | 550,000 | ||||||||||||||
| Less: Inception-to-date distributions (excluding regular-way dividends) | (105,664 | ) | ||||||||||||||
| CLNY & OP cost basis as of 12/31/2015 | $ | 444,336 | ||||||||||||||
| Less: CLNY & OP Share of Colony American Finance net book value | (57,343 | ) | ||||||||||||||
| Allocated cost basis of Colony Starwood Homes | $ | 386,993 | ||||||||||||||
| Colony Starwood Homes shares beneficially owned by OP and common stockholders as of 1/5/2016 | 15.1 million | |||||||||||||||
20
VI. Other Real Estate Equity
| VIa. Other Real Estate Equity—Summary Metrics |
($ and € in thousands, except per share data; as of or for the three months ended December 31, 2015) | ||||||||||||||||||
| Financial results related to the segment | ||||||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders | $ | 15,688 | ||||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.12 | |||||||||||||||||
| FFO attributable to common interests in OP and common stockholders | 11,855 | |||||||||||||||||
| FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.09 | |||||||||||||||||
| Portfolio overview | ||||||||||||||||||
| Consolidated real estate and related assets, net held for investment | ||||||||||||||||||
| NNN Investments | ||||||||||||||||||
CLNY & OP share of real estate and related assets, net (1) | $ | 641,911 | ||||||||||||||||
| CLNY & OP share of investment-level non-recourse financing | 406,297 | |||||||||||||||||
| CLNY & OP share of Q4 NOI | 9,989 | |||||||||||||||||
| Other real estate assets | ||||||||||||||||||
CLNY & OP share of real estate and related assets, net (1) | 258,327 | |||||||||||||||||
| Consolidated investment-level non-recourse financing | 176,933 | |||||||||||||||||
| Consolidated real estate and related assets, net held for sale | ||||||||||||||||||
CLNY & OP share of real estate and related assets, net (1) | 71,959 | |||||||||||||||||
| Unconsolidated assets | ||||||||||||||||||
| CLNY & OP share of investments in unconsolidated joint ventures excluding Albertsons investment | 144,925 | |||||||||||||||||
| CLNY & OP share of investments in unconsolidated joint ventures - Albertsons investment | 49,934 | |||||||||||||||||
| Number of post-IPO shares in Albertsons pursuant to preliminary prospectus dated October 2, 2015 | 8.45 million | |||||||||||||||||
| CLNY & OP % ownership interest in post-IPO AB Acquisition LLC based on preliminary prospectus dated October 2, 2015 | 2.17 | % | ||||||||||||||||
| Investment-level non-recourse mortgage debt | ||||||||||||||||||
| Property type | Initial maturity date | Fully extended maturity date | Interest rate | CLNY & OP share of outstanding balance | ||||||||||||||
| NNN Investments | ||||||||||||||||||
| Office | Jan-2024 | Jan-2024 | 4.84 | % | $ | 87,340 | ||||||||||||
| Higher education campus | Dec-2029 | Dec-2029 | 2.72 | % | 120,947 | |||||||||||||
| Office | Jun-2025 | Jun-2025 | 3.91 | % | 180,960 | |||||||||||||
| Office | Nov-2022 | Nov-2022 | 1.89 | % | 17,050 | |||||||||||||
| Total debt related to NNN investments | 406,297 | |||||||||||||||||
| Other real estate assets | ||||||||||||||||||
| Office Portfolio | Aug-2018 | Aug-2020 | 3ML + 2.50% | 44,072 | ||||||||||||||
| Office Portfolio | Nov-2018 | Nov-2018 | 4.02 | % | 23,973 | (2) | ||||||||||||
| Hotel Portfolio | Jan-2019 | Jan-2021 | L + 4.65% | 30,126 | ||||||||||||||
| Warehouse Portfolio | Jun-2022 | Jun-2022 | 3M EUR + 2.80% | 11,676 | ||||||||||||||
| Mixed Use | Dec-2018 | Dec-2020 | 3ML + 2.75% | 47,081 | ||||||||||||||
| Office | Jul-2018 | Jul-2020 | L + 2.65% | 6,750 | ||||||||||||||
| CDCF IV subscription line | Sept-2016 | Sept-2016 | L + 1.60% | 13,255 | ||||||||||||||
| Total debt related to other real estate assets | 176,933 | |||||||||||||||||
| Total debt related to consolidated real estate and related assets, net held for investment | 583,230 | |||||||||||||||||
| Debt issuance costs and discount | (9,943 | ) | ||||||||||||||||
| Total debt net of debt issuance costs and discount | $ | 573,287 | ||||||||||||||||
__________
| (1) | Includes all components related to the asset, including real estate and lease-related intangibles. |
| (2) | Seller provided zero-interest financing on acquired portfolio of properties with imputed interest of 4.02%, requiring principal payments of €15,750, €35,438 and €27,562 in Nov 2016, Nov 2017 and Nov 2018, respectively, of which CLNY and OP share is 28%. A discount was established at inception and is being accreted to debt principal as interest expense. |
22
VIb. Other Real Estate Equity—Summary of Assets |
| ($ in thousands; as of or for the three months ended December 31, 2015) | |||||||||||||||||||||||||||||||||
| CLNY & OP Pro Rata Share | |||||||||||||||||||||||||||||||||
| Property type | Type | Year Acquired or Foreclosed | Location | Number of buildings | Rentable square feet (thousands) | Real estate assets & intangibles, net | Investment-level non-recourse debt | Equity of real estate assets held for investment | Percentage leased (end of period) | Number of leases | Lease expiration | ||||||||||||||||||||||
| NNN Investments | |||||||||||||||||||||||||||||||||
| Office | NNN | 2015 | Norway | 26 | 1,319 | $ | 308,156 | $ | 180,960 | $ | 127,196 | 100 | % | 1 | 6/2030 | ||||||||||||||||||
| Education | NNN | 2015 | Switzerland | 20 | 304 | 171,145 | 120,947 | 50,198 | 100 | % | 2 | 1/2035 | |||||||||||||||||||||
| Office | NNN | 2013 | Minnesota | 2 | 502 | 111,580 | 87,340 | 24,240 | 100 | % | 1 | 9/2020 | |||||||||||||||||||||
| Office | NNN | 2015 | France | 3 | 17 | 36,248 | 17,050 | 19,198 | 100 | % | 1 | 11/2027 | |||||||||||||||||||||
| Mixed Use | NNN | 2014 | Arizona | 2 | 82 | 14,782 | — | 14,782 | 100 | % | 1 | 6/2027 | |||||||||||||||||||||
| Total Net Leases | 53 | 2,224 | 641,911 | 406,297 | 235,615 | ||||||||||||||||||||||||||||
| Other Real Estate Assets | |||||||||||||||||||||||||||||||||
| Office | Other | 2014-2015 | UK | 37 | 1,002 | 77,228 | 44,072 | 33,156 | 91 | % | 106 | 5/2016 to 6/3012 | |||||||||||||||||||||
| Office | Other | 2013 | Arizona | 2 | 440 | 21,509 | 6,750 | 14,759 | 62 | % | 21 | 4/2016 to 6/2021 | |||||||||||||||||||||
| Mixed Use | Other | 2015 | UK | 38 | 2,885 | 81,402 | 47,081 | 34,321 | 90 | % | 261 | 1/2016 to 12/2252 | |||||||||||||||||||||
| Industrial | Other | 2014 | Spain | 14 | 1,055 | 23,824 | 11,676 | 12,148 | 100 | % | 14 | 12/2026 to12/2029 | |||||||||||||||||||||
| Hotel | Other | 2012 | Various U.S. | 35 | NA | 33,074 | 30,126 | 2,948 | NA | NA | NA | ||||||||||||||||||||||
| Office | Other | 2014 | Italy (1) | 35 | 213 | 21,290 | — | 21,290 | 78 | % | 47 | 5/2017 to 11/2020 | |||||||||||||||||||||
| Total Other Real Estate Assets | 161 | 5,595 | 258,327 | 139,705 | (2) | 118,622 | |||||||||||||||||||||||||||
| Total Other Real Estate Assets Held for Investment | 214 | 7,819 | $ | 900,238 | $ | 546,002 | $ | 354,237 | |||||||||||||||||||||||||
__________
(1) Excludes one building with 218,000 rentable square feet that is subject to development.
(2) Excludes $22.2 million of deferred purchase price and $13.3 million of CDCF IV subscription line debt.
23
VII. Real Estate Debt
| VIIa. Real Estate Debt—Summary Metrics |
| ($ in thousands, except per share data; as of or for the three months ended December 31, 2015) | |||||||||||||||||||
| Financial results related to the segment | |||||||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders | $ | 69,815 | |||||||||||||||||
| Core FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.52 | ||||||||||||||||||
| FFO attributable to common interests in OP and common stockholders | 63,182 | ||||||||||||||||||
| FFO attributable to common interests in OP and common stockholders per basic common share / common OP unit | 0.47 | ||||||||||||||||||
| Portfolio overview | |||||||||||||||||||
| Non-PCI loans | |||||||||||||||||||
| CLNY & OP share of loans receivables, net, held for investment and held for sale | $ | 2,619,716 | |||||||||||||||||
| CLNY & OP share of investment-level non-recourse financing | 1,030,446 | ||||||||||||||||||
| Investments in unconsolidated joint ventures | 117,465 | ||||||||||||||||||
| PCI loans | |||||||||||||||||||
| CLNY & OP share of loans receivables, net, held for investment | 229,037 | ||||||||||||||||||
| CLNY & OP share of investment-level non-recourse financing | 26,230 | ||||||||||||||||||
| Investments in unconsolidated joint ventures | 4,866 | ||||||||||||||||||
| Real Estate Assets, net (REO within debt portfolio) | |||||||||||||||||||
CLNY & OP share of real estate & related assets, net (1) | 33,577 | ||||||||||||||||||
| Investment-level non-recourse financing | |||||||||||||||||||
| Non-PCI | Initial maturity date | Fully-extended maturity date | Interest rate | Maximum principal amount | CLNY & OP pro rata share of outstanding balance | ||||||||||||||
| February 2014 warehouse facility | Feb-2017 | Feb-2017 | L + 2.50% | $ | 150,000 | $ | 47,229 | ||||||||||||
| April 2015 warehouse facility | Apr-2018 | Apr-2019 | L + 2.50% - L+2.75% | 250,000 | 114,433 | ||||||||||||||
| Colony 2014-MF1 securitization | Apr-2050 | Apr-2050 | 2.54 | % | N/A | 145,349 | |||||||||||||
| CLO bonds - CMC 2014-1 | Apr-2031 | Apr-2031 | L + 1.78% | N/A | 121,261 | ||||||||||||||
| CLO bonds - CMC 2014-2 | Nov-2031 | Nov-2031 | L + 1.96% | N/A | 195,687 | ||||||||||||||
| CLO bonds - CMC 2015 | Sept-2032 | Sept-2032 | L + 2.36% | N/A | 340,350 | ||||||||||||||
| Florida multifamily property loan | Mar-2016 | Sept-2016 | 4.28 | % | (2) | N/A | 4,949 | ||||||||||||
| Freddie Mac portfolio | Dec-2017 | Dec-2019 | L + 2.85% | N/A | 53,732 | ||||||||||||||
| CDCF IV subscription line | Sept-2016 | Sept-2016 | L + 1.60% | N/A | 7,456 | ||||||||||||||
| Total Non-PCI | 1,030,446 | ||||||||||||||||||
| PCI | |||||||||||||||||||
| Project London loan portfolio | Apr-2016 | Apr-2019 | L + 3.75% | N/A | 11,559 | ||||||||||||||
| Midwest loan portfolio | Jun-2016 | Jun-2017 | L + 4.00% | N/A | 2,721 | ||||||||||||||
| Metro loan portfolio | Apr-2016 | Apr-2018 | L + 3.75% | N/A | 5,483 | ||||||||||||||
| California first mortgage portfolio I | Aug-2016 | Aug-2018 | L + 3.75% | N/A | 4,289 | ||||||||||||||
| California first mortgage portfolio II | Sept-2016 | Sept-2018 | L + 3.25% | N/A | 2,178 | ||||||||||||||
| Total PCI | 26,230 | ||||||||||||||||||
| Total debt | 1,056,676 | ||||||||||||||||||
| Debt issuance costs | (9,126 | ) | |||||||||||||||||
| Total debt net of issuance costs | $ | 1,047,550 | |||||||||||||||||
__________
(1) Includes all components related to the asset, including real estate and lease-related intangibles.
(2) The variable interest rate on the loan was fixed at 4.28% through an interest rate swap.
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| VIIb. Real Estate Debt—Portfolio Overview |
| CLNY & OP Pro Rata Share | |||||||||||||
| ($ in thousands; as of December 31, 2015) | Unpaid principal balance | Gross carrying amount | Weighted average coupon | Weighted average maturity in years | |||||||||
| Non-PCI loans | |||||||||||||
| Fixed rate | |||||||||||||
| Mortgage loans | $ | 482,339 | $ | 478,654 | 9.8 | % | 4.4 | ||||||
| Securitized mortgage loans | 135,519 | 138,542 | 6.4 | % | 16.9 | ||||||||
| B-notes | 152,778 | 153,240 | 8.3 | % | 2.4 | ||||||||
| Mezzanine loans | 102,806 | 103,822 | 11.7 | % | 3.2 | ||||||||
| Total fixed rate non-PCI loans | 873,442 | 874,258 | |||||||||||
| Variable rate | |||||||||||||
| Mortgage loans | 512,324 | 507,406 | 7.0 | % | 1.7 | ||||||||
| Securitized mortgage loans | 1,033,080 | 1,029,618 | 5.5 | % | 3.5 | ||||||||
| B-notes | 1,796 | 1,567 | 9.5 | % | 2.3 | ||||||||
| Mezzanine loans | 192,956 | 192,447 | 10.7 | % | 0.8 | ||||||||
| Total variable rate non-PCI loans | 1,740,156 | 1,731,038 | |||||||||||
| Total Non-PCI Loans | 2,613,598 | 2,605,296 | |||||||||||
| PCI loans | |||||||||||||
| Mortgage loans | 331,629 | 230,620 | |||||||||||
| Securitized mortgage loans | 8,871 | 7,422 | |||||||||||
| Total PCI Loans | 340,500 | 238,042 | |||||||||||
| Non-PCI loan held for sale | 14,891 | 14,892 | |||||||||||
| Allowance for loan losses | — | (9,477 | ) | ||||||||||
| Total loans receivable | $ | 2,968,989 | $ | 2,848,753 | |||||||||
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VIII. Investment Management
| VIIIa. Investment Management—Summary Metrics |
| ($ in thousands unless otherwise noted; as of or for three months ended December 31, 2015) | ||||
| AUM | $18.8 billion | |||
| FEEUM | $9.3 billion | |||
| Credit Funds | $3.6 billion | |||
| Core Plus / Value-Add Funds | $1.9 billion | |||
| Opportunity Funds | $3.8 billion | |||
| Income: | ||||
| Total income | $ | 19,459 | ||
| Expenses: | ||||
| Amortization | 5,264 | |||
| Compensation expense | 10,755 | |||
| Impairment loss | 4,103 | |||
| Administrative expenses | 224 | |||
| Total expenses | 20,346 | |||
| Other gain, net | 4 | |||
| Income tax benefit | 5,926 | |||
| Net Income | 5,043 | |||
| Add: Noncash equity compensation expense | 667 | |||
| Add: Unrealized gain on derivatives | (5 | ) | ||
| Add: Amortization of investment management intangibles | 9,367 | |||
| Add: Deferred tax benefit effect on amortization and impairment of investment management intangibles | (3,513 | ) | ||
| Core FFO | $ | 11,559 | ||
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IX. Definitions
| IX. Definitions |
| a) | Assets Under Management ("AUM") refers to the assets for which the Company provides investment management services and includes assets for which it may or may not charge management fees and/or performance allocations. AUM is presented as of December 31, 2015 and equals the sum of: a) the gross fair value of investments held directly by the Company or managed by the Company on behalf of its private funds, co-investments, or other investment vehicles; b) leverage, inclusive of debt held by investments and deferred purchases prices; c) uncalled limited partner capital commitments which the Company is entitled to call from investors during the given commitment period at its discretion pursuant to the terms of their respective funds; and d) with respect to majority-owned and substantially controlled investments the Company consolidates gross assets attributable to third-party investors. The Company's calculations of AUM may differ from the calculations of other asset managers, and as a result this measure may not be comparable to similar measures presented by other asset managers. |
| b) | Colony Capital, Inc. ("CLNY") |
| c) | Colony Light Industrial Platform ("CLIP") |
| d) | Core Funds from Operations ("Core FFO") is calculated by adjusting Funds from Operations ("FFO") for the following items, including the Company’s share of these items recognized by the Company’s unconsolidated partnerships and joint ventures: (i) gains and losses from sales of depreciable real estate, net of depreciation, amortization and impairment previously adjusted for FFO; (ii) stock compensation expense; (iii) effects of straight-line rent revenue and straight-line rent expense on ground leases; (iv) amortization of acquired above- and below-market lease values; (v) amortization of deferred financing costs and debt premiums and discounts; (vi) unrealized fair value gains or losses on derivative instruments and on foreign currency remeasurements; (vii) acquisition-related expenses, merger and integration costs; (viii) amortization and impairment of finite-lived intangibles related to investment management contracts and customer relationships; (ix) deferred tax benefit related to amortization and impairment of investment management contracts and customer relationships; (x) gain on remeasurement of consolidated investment entities, net of deferred tax liability, and the effect of amortization thereof; (xi) non-real estate depreciation and amortization; and (xii) change in fair value of contingent consideration. |
| e) | Fee-Earning Equity Under Management ("FEEUM") refers to the equity for which the Company provides investment management services and from which it derives management fees and/or performance allocations. FEEUM is presented as of December 31, 2015. FEEUM includes $0.8 billion of uncalled limited partner capital commitments which will not bear fees until such capital is called at the Company’s discretion. The Company's calculations of FEEUM may differ from the calculations of other asset managers, and as a result this measure may not be comparable to similar measures presented by other asset managers. |
| f) | Funds from Operations ("FFO") is calculated in accordance with standards established by the National Association of Real Estate Investment Trusts ("NAREIT"), which defines FFO as net income or loss calculated in accordance with GAAP, excluding extraordinary items, as defined by GAAP, gains and losses from sales of depreciable real estate and impairment write-downs associated with depreciable real estate, plus real estate-related depreciation and amortization, and after similar adjustments for unconsolidated partnerships and joint ventures. |
| g) | Net Operating Income ("NOI") is property operating income less property operating expenses adjusted for non-cash items, including straight line rents and above/below market lease amortization. |
| h) | Operating Company ("OP") refers to Colony Capital Operating Company, LLC, an operating subsidiary of the Company. The Company is structured as an umbrella partnership real estate investment trust, or UPREIT, in which its wholly-controlled subsidiary, Colony Capital Operating Company, LLC (the “OP”), directly or indirectly holds substantially all of the Company’s assets and directly or indirectly conducts substantially all of the Company’s business. |
| i) | Purchased Credit-Impaired ("PCI") represent loans that were acquired at a discount with evidence of underlying credit deterioration and for which it is probable that all contractually required payments will not be collected. |
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