Alexander & Baldwin, Inc.
| | | | | |
| Company Overview | |
| Company Profile | |
| Glossary of Terms | |
| Statement on Management's Use of Non-GAAP Financial Measures | |
| Financial Summary | |
| Table 1 – Condensed Consolidated Balance Sheets | |
| Table 2 – Condensed Consolidated Statements of Operations | |
| Table 3 – Segment Results | |
| Table 4 – Condensed Consolidated Statements of Cash Flows | |
| Table 5 – Debt Summary | |
| Table 6 – Capitalization & Financial Ratios | |
| Table 7 – Consolidated Metrics | |
| Commercial Real Estate | |
| Table 8 – CRE Metrics | |
| Table 9 – Occupancy | |
| Table 10 – NOI and Same-Store NOI by Type | |
| Table 11 – Improved Property Report | |
| Table 12 – Ground Lease Report | |
| Table 13 – Top 10 Tenants Ranked by ABR | |
| Table 14 – Lease Expiration Schedule | |
| Table 15 – New & Renewal Lease Summary | |
| Table 16 – Portfolio Repositioning, Redevelopment & Development Summary | |
| Table 17 – Transactional Activity (2022 - 2023) | |
| Land Operations | |
| Table 18 – Statement of Operating Profit, EBITDA and Adjusted EBITDA | |
| Table 19 – Core Real Estate Development-for-sale Projects | |
| Table 20 – Components of Land Operations | |
Forward-Looking Statements
Statements in this Supplemental Information document that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding possible or assumed future results of operations, business strategies, growth opportunities and competitive positions. Such forward-looking statements speak only as of the date the statements were made and are not guarantees of future performance. Forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from those expressed in or implied by the forward-looking statements. These factors include, but are not limited to, prevailing market conditions and other factors related to the Company's REIT status and the Company's business, the evaluation of alternatives by the Company related to its non-core assets and business, and the risk factors discussed in the Company's most recent Form 10-K, Form 10-Q and other filings with the Securities and Exchange Commission (“SEC”). The information in this Supplemental Information document should be evaluated in light of these important risk factors. We do not undertake any obligation to update the Company's forward-looking statements.
Basis of Presentation
The information contained in this Supplemental Information document does not purport to disclose all items required by accounting principles generally accepted in the United States of America (GAAP).
Company Overview
Alexander & Baldwin, Inc.
Company Overview
Company Profile
Alexander & Baldwin, Inc. ("A&B" or the "Company") is a fully integrated real estate investment trust ("REIT") headquartered in Honolulu, Hawai‘i. The Company has a history of over 150 years of being an integral piece of Hawai‘i and its economy making it uniquely qualified to create value for shareholders through a strategy focused on asset management and growth primarily in its commercial real estate holdings in Hawai‘i.
The Company operates in two reportable segments: Commercial Real Estate ("CRE") and Land Operations, and is composed of the following as of March 31, 2023:
•A commercial real estate portfolio composed of 3.9 million square feet of improved properties and 142.0 acres of ground leases throughout the Hawaiian islands, including 2.5 million square feet of largely grocery/drugstore-anchored retail centers; and
•A land operations portfolio consisting of approximately 4,111 acres of legacy landholdings and assets that are subject to the Company's simplification and monetization efforts, and 56 acres of core landholdings, including development-for-hold and development-for-sale activities on Oahu and Maui.
In December 2022, the Company's Board of Directors authorized Management to sell the Company's wholly-owned subsidiary, Grace Pacific LLC ("Grace Pacific"), a materials and construction company in Hawai‘i, and Company-owned quarry land on Maui ("Maui Quarries"). The assets and liabilities associated with Grace Pacific and the Maui Quarries have been classified as held for sale and its financial results are classified as discontinued operations for all periods presented herein. Collectively, Grace Pacific and the Maui Quarries made up the majority of activity in the Company's Materials and Construction reportable segment ("M&C"). Accordingly, the former M&C segment has been eliminated and the segment information presented herein excludes the results of Grace Pacific and the Maui Quarries for all periods presented. In conjunction with the elimination of the M&C segment, the Company's remaining equity interest in an unconsolidated materials company was incorporated with the Land Operations reportable segment.
Throughout this Supplemental Information document, references to "we," "our," "us" and "our Company" refer to Alexander & Baldwin, Inc., together with its consolidated subsidiaries.
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| Executive Officers |
| | | |
| Christopher Benjamin | | Clayton Chun |
| Chief Executive Officer | | Executive Vice President, Chief Financial Officer & Treasurer |
| | | |
| Lance Parker | | Meredith Ching |
| President & Chief Operating Officer | | Executive Vice President, External Affairs |
| | | |
| Jerrod Schreck | | |
| Executive Vice President, A&B & President, Grace Pacific | | |
| | | |
| Contact Information | | Equity Research |
| | | |
| Corporate Headquarters | | Piper Sandler & Co. | |
| 822 Bishop Street | | Alexander Goldfarb | |
| Honolulu, HI 96813 | | (212) 466-7937 | |
| | alexander.goldfarb@psc.com | |
| Investor Relations | | | |
| Clayton Chun | | Other Company Information |
| Executive Vice President, Chief Financial Officer & Treasurer | | | |
| (808) 525-6606 | | Stock exchange listing: | NYSE: ALEX |
| investorrelations@abhi.com | | Corporate website: | www.alexanderbaldwin.com |
| | Grace Pacific website: | www.gracepacific.com |
| Transfer Agent & Registrar | | Market capitalization at March 31, 2023: | $1.4B |
| Computershare | | 3-month average trading volume: | 245K |
| P.O. Box 43006 | | Independent auditor: | Deloitte & Touche LLP |
| Providence, RI 02940-3006 | | | |
| (866) 442-6551 | | | |
| | | |
| Overnight Correspondence | | | |
| Computershare | | | |
| 150 Royall Street, Suite 101 | | | |
| Canton, MA 02021 | | | |
| | | |
Shareholder website: www.computershare.com/investor | | | |
Online inquiries: www-us.computershare.com/investor/contact | | | |
Alexander & Baldwin, Inc.
Company Overview
Glossary of Terms | | | | | |
| ABR | Annualized Base Rent ("ABR") is the current month's contractual base rent multiplied by 12. Base rent is presented without consideration of percentage rent that may, in some cases, be significant. |
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| Comparable Lease | Comparable Leases are either renewals (executed for the same units) or new leases (executed for units that have been vacated in the previous 12 months) for comparable space and comparable lease terms. Expansions, contractions and strategic short-term renewals are excluded from the Comparable Lease pool. |
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| CRE Portfolio | Composed of (1) retail, industrial and office improved properties subject to operating leases ("Improved Portfolio") and (2) assets subject to ground leases ("Ground Leases") within the CRE segment. |
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| Debt-service Coverage Ratio | The ratio of Consolidated Adjusted EBITDA to the sum of debt service – which includes interest expense, principal payments for financing leases and term debt, as well as principal amortization of mortgage debt, but excludes balloon payments – for the trailing twelve months. |
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| EBITDA and Segment Adjusted (or Consolidated Adjusted) EBITDA | Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") is calculated on a consolidated basis ("Consolidated EBITDA") by adjusting the Company’s consolidated net income (loss) to exclude the impact of interest expense, income taxes and depreciation and amortization.
EBITDA is calculated for each segment ("Segment EBITDA" or "Commercial Real Estate EBITDA" and "Land Operations EBITDA") by adjusting segment operating profit (which excludes interest expense and income taxes) to add back depreciation and amortization recorded at the respective segment.
Segment Adjusted EBITDA (or Consolidated Adjusted EBITDA) is calculated by adjusting Segment EBITDA (or Consolidated EBITDA) for items identified as non-recurring, infrequent or unusual that are not expected to recur in the segment’s normal operations (or in the Company’s core business). Segment Adjusted EBITDA may also be referred to as CRE Adjusted EBITDA or Land Operations Adjusted EBITDA (when applicable). |
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| FFO | Funds From Operations ("FFO") is presented by the Company as a widely used non-GAAP measure of operating performance for real estate companies. FFO is defined by the National Association of Real Estate Investment Trusts ("Nareit") December 2018 Financial Standards White Paper as follows: net income (loss) available to A&B common shareholders (calculated in accordance with GAAP), excluding (1) depreciation and amortization related to real estate, (2) gains and losses from the sale of certain real estate assets, (3) gains and losses from change in control, (4) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, and (5) income (loss) from discontinued operations that are incidental to CRE. The Company presents different forms of FFO:
•"Core FFO" represents a non-GAAP measure relevant to the operating performance of the Company's commercial real estate business (i.e., its core business). Core FFO is calculated by adjusting CRE operating profit to exclude items noted above (i.e., depreciation and amortization related to real estate included in CRE operating profit) and to make further adjustments to include expenses not included in CRE operating profit but that are necessary to accurately reflect the operating performance of its core business (i.e., corporate expenses and interest expense attributable to this core business) or to exclude items that are non-recurring, infrequent, unusual and unrelated to the core business operating performance (i.e., not likely to recur within two years or has not occurred within the prior two years).
•FFO represents the Nareit-defined non-GAAP measure for the operating performance of the Company as a whole. The Company's calculation refers to net income (loss) available to A&B common shareholders as its starting point in the calculation of FFO.
The Company presents both non-GAAP measures and reconciles each to the most directly-comparable GAAP measure as well as reconciling FFO to Core FFO. The Company's FFO and Core FFO may not be comparable to FFO non-GAAP measures reported by other REITs. These other REITs may not define the term in accordance with the current Nareit definition or may interpret the current Nareit definition differently. |
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| GAAP | Generally accepted accounting principles in the United States of America. |
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| GLA | Gross leasable area ("GLA") measured in square feet ("SF"). GLA is periodically adjusted based on remeasurement or reconfiguration of space and may change period over period for these remeasurements. |
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| Maintenance Capital Expenditures | As it relates to CRE segment capital expenditures (i.e., capitalizable costs on a cash basis), normalized recurring expenditures necessary to maintain building value, the current income stream and position in the market. Such expenditures may include building/area improvements and tenant space improvements. |
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| Net Debt | Net Debt is calculated by adjusting the Company's total debt to its notional amount (by excluding unamortized premium, discount and capitalized loan fees) and by subtracting cash and cash equivalents recorded in the Company's consolidated balance sheets. |
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| NOI | Net Operating Income ("NOI") represents total Commercial Real Estate contract-based operating revenue that is realizable (i.e., assuming collectability is deemed probable) less the direct property-related operating expenses paid or payable in cash. The calculation of NOI excludes the impact of depreciation and amortization (e.g., depreciation related to capitalized costs for improved properties, other capital expenditures for building/area improvements and tenant space improvements, as well as amortization of leasing commissions); straight-line lease adjustments (including amortization of lease incentives); amortization of favorable/unfavorable lease assets/liabilities; lease termination income; interest and other income (expense), net; selling, general, administrative and other expenses (not directly associated with the property); and impairment of commercial real estate assets. |
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| Occupancy | The Company has historically (through the period ended December 31, 2020) reported occupancy on a physical basis (i.e., based on timing of when the lessee has physical access to the space, henceforth, “Physical Occupancy”). The Company presents two additional types of occupancy ("Leased Occupancy" and "Economic Occupancy").
The Leased Occupancy percentage calculates the square footage leased (i.e., the space has been committed to by a lessee under a signed lease agreement) as a percentage of total available improved property square footage as of the end of the period reported.
The Economic Occupancy percentage calculates the square footage under leases for which the lessee is contractually obligated to make lease-related payments (i.e., subsequent to the rent commencement date) to total available improved property square footage as of the end of the period reported. |
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| PSF | Per square foot of GLA. |
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| Rent Spread | Percentage change in ABR in the first year of a signed lease relative to the ABR in the last year of the prior lease. |
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| Same-Store | The Company reports NOI and Occupancy on a Same-Store basis, which includes the results of properties that were owned and operated for the entirety of the prior calendar year and current reporting period, year-to-date. The Same-Store pool excludes properties under development or redevelopment and also excludes properties acquired or sold during either of the comparable reporting periods. While there is management judgment involved in classifications, new developments and redevelopments are moved into the Same-Store pool after one full calendar year of stabilized operation. Properties included in held for sale are excluded from Same-Store. |
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| Stabilization | New developments and redevelopments are generally considered stabilized upon the initial attainment of 90% economic occupancy. |
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| Straight-line Rent | Non-cash revenue related to a GAAP requirement to average tenant rents over the life of the lease, regardless of the actual cash collected in the reporting period. |
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| TTM | Trailing twelve months. |
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| Year Built | Year of most recent repositioning/redevelopment or year built if no repositioning/redevelopment has occurred. |
Alexander & Baldwin, Inc.
Company Overview
Statement on Management's Use of Non-GAAP Financial Measures
The Company presents the following non-GAAP financial measures in this Supplemental Information document:
•Consolidated EBITDA
•Consolidated Adjusted EBITDA
•FFO
•Core FFO
•Commercial Real Estate NOI and Same-Store NOI
•Commercial Real Estate EBITDA
•Land Operations EBITDA and Land Operations Adjusted EBITDA
The Company uses non-GAAP measures when evaluating operating performance because management believes that they provide additional insight into the Company's and segments' core operating results, and/or the underlying business trends affecting performance on a consistent and comparable basis from period to period. These measures generally are provided to investors as an additional means of evaluating the performance of ongoing core operations. The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for or superior to, financial measures calculated in accordance with GAAP.
The Company may report various forms of EBITDA (e.g., Segment EBITDA — also referred to as Commercial Real Estate EBITDA and Land Operations EBITDA — and Consolidated EBITDA) as non-GAAP measures used by the Company in evaluating the segments' and Company's operating performance on a consistent and comparable basis from period to period. The Company provides this information to investors as an additional means of evaluating the performance of the segments' and Company’s ongoing operations.
The Company also adjusts Segment EBITDA or Consolidated EBITDA to arrive at Segment Adjusted EBITDA or Consolidated Adjusted EBITDA for items identified as non-recurring, infrequent or unusual that are not expected to recur in the segment’s normal operations (or in the Company’s core business). Segment Adjusted EBITDA may also be referred to as CRE Adjusted EBITDA or Land Operations Adjusted EBITDA (when applicable).
As an illustrative example, the Company identified non-cash pension termination charges as a non-recurring, infrequent or unusual item that is not expected to recur in the consolidated or segment’s normal operations (or in the Company’s core business). By excluding these items from Segment EBITDA and Consolidated EBITDA to arrive at Segment Adjusted EBITDA or Consolidated Adjusted EBITDA, the Company believes it provides meaningful supplemental information about its core operating performance and facilitates comparisons to historical operating results. Such non-GAAP measures should not be viewed as a substitute for, or superior to, financial measures calculated in accordance with GAAP.
FFO is presented by the Company as a widely used non-GAAP measure of operating performance for real estate companies. The Company believes that, subject to the following limitations, FFO provides a supplemental measure to net income (calculated in accordance with GAAP) for comparing its performance and operations to those of other REITs. FFO does not represent an alternative to net income calculated in accordance with GAAP. In addition, FFO does not represent cash generated from operating activities in accordance with GAAP, nor does it represent cash available to pay distributions and should not be considered as an alternative to cash flow from operating activities, determined in accordance with GAAP, as a measure of the Company’s liquidity. The Company presents different forms of FFO:
•Core FFO represents a non-GAAP measure relevant to the operating performance of the Company's commercial real estate business (i.e., its core business). Core FFO is calculated by adjusting CRE operating profit to exclude items in a manner consistent with FFO (i.e., depreciation and amortization related to real estate included in CRE operating profit) and to make further adjustments to include expenses not included in CRE operating profit but that are necessary to accurately reflect the operating performance of its core business (i.e., corporate expenses and interest expense attributable to this core business) or to exclude items that are non-recurring, infrequent, unusual and unrelated to the core business operating performance (i.e., not likely to recur within two years or has not occurred within the prior two years). The Company believes such adjustments facilitate the comparable measurement of the Company's core operating performance over time. The Company believes that Core FFO, which is a supplemental non-GAAP financial measure, provides an additional and useful means to assess and compare the operating performance of REITs.
•FFO represents the Nareit-defined non-GAAP measure for the operating performance of the Company as a whole. The Company's calculation refers to net income (loss) available to A&B common shareholders as its starting point in the calculation of FFO.
The Company presents both non-GAAP measures and reconciles each to the most directly-comparable GAAP measure as well as reconciling FFO to Core FFO. The Company's FFO and Core FFO may not be comparable to FFO non-GAAP measures reported by other REITs. These other REITs may not define the term in accordance with the current Nareit definition or may interpret the current Nareit definition differently.
NOI is a non-GAAP measure used internally in evaluating the unlevered performance of the Company's Commercial Real Estate portfolio. The Company believes NOI provides useful information to investors regarding the Company's financial condition and results of operations because it reflects only the contract-based income and cash-based expense items that are incurred at the property level. When compared across periods, NOI can be used to determine trends in earnings of the Company's properties as this measure is not affected by non-contract-
based revenue (e.g., straight-line lease adjustments required under GAAP); by non-cash expense recognition items (e.g., the impact of depreciation and amortization expense or impairments); or by other expenses or gains or losses that do not directly relate to the Company's ownership and operations of the properties (e.g., indirect selling, general, administrative and other expenses, as well as lease termination income). The Company believes the exclusion of these items from operating profit (loss) is useful because the resulting measure captures the contract-based revenue that is realizable (i.e., assuming collectability is deemed probable) and the direct property-related expenses paid or payable in cash that are incurred in operating the Company's Commercial Real Estate portfolio, as well as trends in occupancy rates, rental rates and operating costs. NOI should not be viewed as a substitute for, or superior to, financial measures calculated in accordance with GAAP.
The Company reports NOI and Occupancy on a Same-Store basis, which includes the results of properties that were owned and operated for the entirety of the prior calendar year and current reporting period, year-to-date. The Company believes that reporting on a Same-Store basis provides investors with additional information regarding the operating performance of comparable assets separate from other factors (such as the effect of developments, redevelopments, acquisitions or dispositions).
The calculations of these financial measures are described in the Glossary of Terms of this Supplemental Information document. To emphasize, the Company's methods of calculating non-GAAP measures may differ from methods employed by other companies and thus may not be comparable to such other companies.
Required reconciliations of these non-GAAP financial measures to the most directly comparable financial measure calculated and presented in accordance with GAAP are set forth in the following tables of this Supplemental Information document:
•Refer to Table 7 – Consolidated Metrics for a reconciliation of consolidated net income to Consolidated EBITDA and Consolidated Adjusted EBITDA, a reconciliation of consolidated net income (loss) available to A&B common shareholders to FFO and Core FFO, as well as a reconciliation of Commercial Real Estate operating profit to Core FFO.
•Refer to Table 8 – CRE Metrics for a reconciliation of Commercial Real Estate operating profit to NOI and Same-Store NOI and a reconciliation of Commercial Real Estate operating profit to Commercial Real Estate EBITDA.
•Refer to Table 18 – Statement of Operating Profit, EBITDA and Adjusted EBITDA for a reconciliation of Land Operations operating profit to Land Operations EBITDA.
Financial Summary
Alexander & Baldwin, Inc.
Financial Summary
Table 1 – Condensed Consolidated Balance Sheets (amounts in millions; unaudited) | | | | | | | | | | | | | | |
| | March 31, | | December 31, |
| | 2023 | | 2022 |
| ASSETS | | | | |
| Real estate investments | | | | |
| Real estate property | | $ | 1,600.7 | | | $ | 1,598.9 | |
| Accumulated depreciation | | (209.3) | | | (202.3) | |
| Real estate property, net | | 1,391.4 | | | 1,396.6 | |
| Real estate developments | | 59.9 | | | 59.9 | |
| Investments in real estate joint ventures and partnerships | | 7.4 | | | 7.5 | |
| Real estate intangible assets, net | | 41.8 | | | 43.6 | |
| Real estate investments, net | | 1,500.5 | | | 1,507.6 | |
| Cash and cash equivalents | | 10.7 | | | 33.3 | |
| Restricted cash | | 1.0 | | | 1.0 | |
| Accounts receivable, net of allowances (credit losses and doubtful accounts) of $2.4 million and $2.5 million as of March 31, 2023, and December 31, 2022, respectively | | 4.2 | | | 6.1 | |
| Other property, net | | 2.3 | | | 2.5 | |
| Operating lease right-of-use assets | | 3.0 | | | 5.4 | |
| Goodwill | | 8.7 | | | 8.7 | |
| Other receivables, net of allowances of $3.6 million and $2.7 million as of March 31, 2023, and December 31, 2022, respectively | | 8.0 | | | 6.9 | |
| Prepaid expenses and other assets | | 92.6 | | | 89.0 | |
| Assets held for sale | | 125.1 | | | 126.8 | |
| Total assets | | $ | 1,756.1 | | | $ | 1,787.3 | |
| | | | |
| LIABILITIES AND EQUITY | | | | |
| Liabilities: | | | | |
| Notes payable and other debt | | $ | 479.2 | | | $ | 472.2 | |
| Accounts payable | | 4.9 | | | 4.5 | |
| Operating lease liabilities | | 2.9 | | | 4.9 | |
| Accrued pension and post-retirement benefits | | 10.1 | | | 10.1 | |
| Deferred revenue | | 71.9 | | | 68.8 | |
| Accrued and other liabilities | | 81.7 | | | 102.1 | |
| Liabilities associated with assets held for sale | | 77.8 | | | 81.0 | |
| Total liabilities | | 728.5 | | | 743.6 | |
| Commitments and Contingencies | | | | |
| Redeemable Noncontrolling Interest | | 7.6 | | | 8.0 | |
| Equity: | | | | |
| Common stock - no par value; authorized, 150.0 million shares; outstanding, 72.6 million and 72.5 million shares at March 31, 2023 and December 31, 2022, respectively | | 1,807.6 | | | 1,808.4 | |
| Accumulated other comprehensive income (loss) | | (2.2) | | | 1.8 | |
| Distributions in excess of accumulated earnings | | (785.4) | | | (774.5) | |
| | | | |
| | | | |
| Total A&B shareholders' equity | | 1,020.0 | | | 1,035.7 | |
| Total liabilities and equity | | $ | 1,756.1 | | | $ | 1,787.3 | |
Alexander & Baldwin, Inc.
Financial Summary
Table 2 – Condensed Consolidated Statements of Operations (amounts in millions, except per share data; unaudited) | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| Operating Revenue: | | | | | | | | |
| Commercial Real Estate | | $ | 47.9 | | | $ | 46.3 | | | | | |
| Land Operations | | 2.5 | | | 12.9 | | | | | |
| | | | | | | | |
| Total operating revenue | | 50.4 | | | 59.2 | | | | | |
| Operating Costs and Expenses: | | | | | | | | |
| Cost of Commercial Real Estate | | 25.0 | | | 24.0 | | | | | |
| Cost of Land Operations | | 3.6 | | | 9.2 | | | | | |
| | | | | | | | |
| Selling, general and administrative | | 8.7 | | | 8.8 | | | | | |
| | | | | | | | |
| Total operating costs and expenses | | 37.3 | | | 42.0 | | | | | |
| | | | | | | | |
| Gain (loss) on disposal of non-core assets, net | | 1.1 | | | — | | | | | |
| | | | | | | | |
| Operating Income (Loss) | | 14.2 | | | 17.2 | | | | | |
| Other Income and (Expenses): | | | | | | | | |
| Income (loss) related to joint ventures | | 0.4 | | | 1.4 | | | | | |
| | | | | | | | |
| Pension termination | | — | | | (3.2) | | | | | |
| Interest and other income (expense), net | | (0.1) | | | (0.1) | | | | | |
| Interest expense | | (5.0) | | | (5.7) | | | | | |
| | | | | | | | |
| | | | | | | | |
| Income (Loss) from Continuing Operations | | 9.5 | | | 9.6 | | | | | |
| Income (loss) from discontinued operations, net of income taxes | | (4.2) | | | 1.4 | | | | | |
| Net Income (Loss) | | 5.3 | | | 11.0 | | | | | |
| | | | | | | | |
| Loss (income) attributable to discontinued noncontrolling interest | | — | | | (0.5) | | | | | |
| Net Income (Loss) Attributable to A&B Shareholders | | $ | 5.3 | | | $ | 10.5 | | | | | |
| | | | | | | | |
| Earnings (Loss) Per Share Available to A&B Shareholders: | | | | | | | | |
| Basic Earnings (Loss) Per Share of Common Stock: | | | | | | | | |
| Continuing operations available to A&B shareholders | | $ | 0.13 | | | $ | 0.13 | | | | | |
| Discontinued operations available to A&B shareholders | | (0.06) | | | 0.01 | | | | | |
| Net income (loss) available to A&B shareholders | | $ | 0.07 | | | $ | 0.14 | | | | | |
| | | | | | | | |
| Diluted Earnings (Loss) Per Share of Common Stock: | | | | | | | | |
| Continuing operations available to A&B shareholders | | $ | 0.13 | | | $ | 0.13 | | | | | |
| Discontinued operations available to A&B shareholders | | (0.06) | | | 0.01 | | | | | |
| Net income (loss) available to A&B shareholders | | $ | 0.07 | | | $ | 0.14 | | | | | |
| | | | | | | | |
| Weighted-Average Number of Shares Outstanding: | | | | | | | | |
| Basic | | 72.5 | | 72.6 | | | | | |
| Diluted | | 72.6 | | 72.8 | | | | | |
| | | | | | | | |
| Amounts Available to A&B Common Shareholders: | | | | | | | | |
| Continuing operations available to A&B common shareholders | | $ | 9.5 | | | $ | 9.6 | | | | | |
| Discontinued operations available to A&B common shareholders | | (4.2) | | | 0.9 | | | | | |
| Net income (loss) available to A&B common shareholders | | $ | 5.3 | | | $ | 10.5 | | | | | |
Alexander & Baldwin, Inc.
Financial Summary
Table 3 – Segment Results (amounts in millions; unaudited) | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| Operating Revenue: | | | | | | | | |
| Commercial Real Estate | | $ | 47.9 | | | $ | 46.3 | | | | | |
| Land Operations | | 2.5 | | | 12.9 | | | | | |
| Total operating revenue | | 50.4 | | | 59.2 | | | | | |
| Operating Profit (Loss): | | | | | | | | |
Commercial Real Estate1 | | 20.9 | | | 20.7 | | | | | |
Land Operations2,3,4 | | (0.1) | | | 1.7 | | | | | |
| Total operating profit (loss) | | 20.8 | | | 22.4 | | | | | |
| | | | | | | | |
| Interest expense | | (5.0) | | | (5.7) | | | | | |
Corporate and other expense5 | | (6.3) | | | (7.1) | | | | | |
| | | | | | | | |
| | | | | | | | |
| Income (Loss) from Continuing Operations | | 9.5 | | | 9.6 | | | | | |
| Income (loss) from discontinued operations, net of income taxes | | (4.2) | | | 1.4 | | | | | |
| Net Income (Loss) | | 5.3 | | | 11.0 | | | | | |
| Loss (income) attributable to discontinued noncontrolling interest | | — | | | (0.5) | | | | | |
| Net Income (Loss) Attributable to A&B Shareholders | | $ | 5.3 | | | $ | 10.5 | | | | | |
| | | | | | | | |
1 Commercial Real Estate segment operating profit (loss) includes intersegment operating revenue, primarily from the Land Operations segment, that is eliminated in the consolidated results of operations. |
2 Land Operations segment operating profit (loss) includes equity in earnings (losses) from the Company's joint ventures. |
3 Land Operations segment operating profit (loss) includes a gain on sale of non-core assets, net, of $1.1 million for the three months ended March 31, 2023, and pension termination expense of $2.3 million for the three months ended March 31, 2022. |
4 As described in the Company’s other filings with the SEC, during the fourth quarter of 2022, the Company changed the composition of its reportable segments which caused reported amounts (i.e., operating profit) in the historical period to be reclassified to Land Operations from the former Materials & Construction reportable segment. All comparable information for the historical periods has been retrospectively adjusted to reflect the impact of these changes. |
5 Corporate and other expense includes pension termination expense of $0.9 million for the three months ended March 31, 2022. |
| | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| Selling, general and administrative expense by segment: | | | | | | | | |
| Commercial Real Estate | | $ | 2.0 | | | $ | 1.6 | | | | | |
| Land Operations | | 0.5 | | | 1.2 | | | | | |
| Corporate | | 6.2 | | | 6.0 | | | | | |
| Total selling, general and administrative expense | | $ | 8.7 | | | $ | 8.8 | | | | | |
| | | | | | | | | | | | | | |
| | March 31,
2023 | | December 31, 2022 |
| Accounts receivable, net by segment: | | | | |
| Commercial Real Estate | | $ | 4.0 | | | $ | 5.4 | |
| Land Operations | | 0.1 | | | 0.7 | |
| Other | | 0.1 | | | — | |
| Total accounts receivable, net | | $ | 4.2 | | | $ | 6.1 | |
| | | | | | | | | | | | | | | | | | | |
| | March 31,
2023 | | December 31, 2022 | | | | | |
| Identifiable assets by segment: | | | | | | | | | |
| Commercial Real Estate | | $ | 1,498.9 | | | $ | 1,499.9 | | | | | | |
| Land Operations | | 110.1 | | | 112.0 | | | | | | |
| Assets Held for Sale | | 125.1 | | | 126.8 | | | | | | |
| Corporate | | 22.0 | | | 48.6 | | | | | | |
| Total assets | | $ | 1,756.1 | | | $ | 1,787.3 | | | | | | |
| | | | | | | | | |
| Book value by segment: | | | | | | | | | |
| Commercial Real Estate | | $ | 1,260.6 | | | $ | 1,265.8 | | | | | | |
| Land Operations | | 5.7 | | | 4.8 | | | | | | |
| Assets Held for Sale, net | | 47.3 | | | 45.8 | | | | | | |
Corporate1 | | (286.0) | | | (272.7) | | | | | | |
Total2 | | $ | 1,027.6 | | | $ | 1,043.7 | | | | | | |
| | | | | | | | | |
1 Primarily composed of corporate debt, partially offset by other assets and liabilities, net. | | | | | |
2 Equals the sum of consolidated total equity and the redeemable noncontrolling interest presented on the consolidated balance sheets. | | | | | |
Alexander & Baldwin, Inc.
Financial Summary
Table 4 – Condensed Consolidated Statements of Cash Flows (amounts in millions; unaudited) | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2023 | | 2022 |
| Cash Flows from Operating Activities: | | | |
| Net income (loss) | $ | 5.3 | | | $ | 11.0 | |
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operations: | | | |
| Loss (income) from discontinued operations | 4.2 | | | (1.4) | |
| Depreciation and amortization | 9.2 | | | 9.9 | |
| | | |
| Loss (gain) from disposals and asset transactions, net | (1.1) | | | — | |
| | | |
| Share-based compensation expense | 1.6 | | | 1.5 | |
| Equity in (income) loss from affiliates, net of operating cash distributions | (0.4) | | | 0.1 | |
| Pension termination | — | | | 3.2 | |
| Changes in operating assets and liabilities: | | | |
| Trade and other receivables | (1.4) | | | (0.8) | |
| | | |
| Prepaid expenses, income tax receivable and other assets | (1.2) | | | (5.7) | |
| Development/other property inventory | (0.1) | | | 3.1 | |
| Accrued pension and post-retirement benefits | — | | | 0.8 | |
| Accounts payable | 0.2 | | | 0.3 | |
| Accrued and other liabilities | (3.6) | | | (4.8) | |
| Operating cash flows from continuing operations | 12.7 | | | 17.2 | |
| Operating cash flows from discontinued operations | (7.2) | | | (9.9) | |
| Net cash provided by (used in) operations | 5.5 | | | 7.3 | |
| | | |
| Cash Flows from Investing Activities: | | | |
| | | |
| Capital expenditures for property, plant and equipment | (3.0) | | | (2.2) | |
| Proceeds from disposal of assets | 1.6 | | | — | |
| Payments for purchases of investments in affiliates and other investments | (0.1) | | | (0.1) | |
| | | |
| Investing cash flows from continuing operations | (1.5) | | | (2.3) | |
| Investing cash flows from discontinued operations | 2.2 | | | (1.6) | |
| Net cash provided by (used in) investing activities | 0.7 | | | (3.9) | |
| | | |
| Cash Flows from Financing Activities: | | | |
| | | |
| Payments of notes payable and other debt and deferred financing costs | (18.0) | | | (10.2) | |
| Borrowings (payments) on line-of-credit agreement, net | 25.0 | | | — | |
| | | |
| Cash dividends paid | (32.0) | | | (27.0) | |
| Repurchases of common stock and other payments | (2.4) | | | (2.2) | |
| | | |
| Financing cash flows from continuing operations | (27.4) | | | (39.4) | |
| Financing cash flows from discontinued operations | (0.4) | | | (0.3) | |
| Net cash provided by (used in) financing activities | (27.8) | | | (39.7) | |
| | | |
| Cash, Cash Equivalents, Restricted Cash, and Cash included in Assets Held for Sale | | | |
| Net increase (decrease) in cash, cash equivalents, restricted cash, and cash included in assets held for sale | (21.6) | | | (36.3) | |
| Balance, beginning of period | 34.4 | | | 71.0 | |
| Balance, end of period | $ | 12.8 | | | $ | 34.7 | |
Alexander & Baldwin, Inc.
Financial Summary
Table 5 – Debt Summary
(dollars in millions; unaudited) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Scheduled Principal Payments | | | | |
| Debt | Interest Rate (%) | Weighted-average Interest Rate (%) | Maturity Date | Weighted-average Maturity (Years) | | 2023 | 2024 | 2025 | 2026 | 2027 | Thereafter | Total Principal | | Premium (discount)/debt issuance costs, net | | Total |
| Secured: | | | | | | | | | | | | | | | | |
| Laulani Village | 3.93% | 3.93% | 2024 | 1.2 | | $ | 1.0 | | $ | 57.8 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 58.8 | | | $ | (0.2) | | | $ | 58.6 | |
| Pearl Highlands | 4.15% | 4.15% | 2024 | 1.7 | | 1.6 | | 75.1 | | — | | — | | — | | — | | 76.7 | | | 0.3 | | | 77.0 | |
| Photovoltaic Financing | (1) | 4.14% | 2027 | 3.8 | | 0.1 | | 0.2 | | 0.2 | | 0.2 | | 1.8 | | — | | 2.5 | | | — | | | 2.5 | |
| Manoa Marketplace | (2) | 3.14% | 2029 | 5.7 | | 1.3 | | 1.8 | | 1.9 | | 2.0 | | 2.0 | | 45.0 | | 54.0 | | | (0.1) | | | 53.9 | |
| Subtotal / Wtd Avg | | 3.80% | | 2.7 | | $ | 4.0 | | $ | 134.9 | | $ | 2.1 | | $ | 2.2 | | $ | 3.8 | | $ | 45.0 | | $ | 192.0 | | | $ | — | | | $ | 192.0 | |
| | | | | | | | | | | | | | | | |
| Unsecured: | | | | | | | | | | | | | | | | |
| Series A Note | 5.53% | 5.53% | 2024 | 0.8 | | $ | 7.1 | | $ | 7.1 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 14.2 | | | $ | — | | | $ | 14.2 | |
| Series J Note | 4.66% | 4.66% | 2025 | 2.1 | | — | | — | | 10.0 | | — | | — | | — | | 10.0 | | | — | | | 10.0 | |
| Series B Note | 5.55% | 5.55% | 2026 | 1.6 | | — | | 9.0 | | 16.0 | | 2.0 | | — | | — | | 27.0 | | | — | | | 27.0 | |
| Series C Note | 5.56% | 5.56% | 2026 | 2.2 | | 2.0 | | 2.0 | | 3.0 | | 4.0 | | — | | — | | 11.0 | | | — | | | 11.0 | |
| Series F Note | 4.35% | 4.35% | 2026 | 2.0 | | 3.9 | | 2.4 | | 3.3 | | 4.0 | | — | | — | | 13.6 | | | — | | | 13.6 | |
| Series H Note | 4.04% | 4.04% | 2026 | 3.7 | | — | | — | | — | | 50.0 | | — | | — | | 50.0 | | | — | | | 50.0 | |
| Series K Note | 4.81% | 4.81% | 2027 | 4.1 | | — | | — | | — | | — | | 34.5 | | — | | 34.5 | | | (0.2) | | | 34.3 | |
| Series G Note | 3.88% | 3.88% | 2027 | 2.8 | | — | | 6.5 | | 6.0 | | 7.0 | | 2.6 | | — | | 22.1 | | | — | | | 22.1 | |
| Series L Note | 4.89% | 4.89% | 2028 | 5.1 | | — | | — | | — | | — | | — | | 18.0 | | 18.0 | | | — | | | 18.0 | |
| Series I Note | 4.16% | 4.16% | 2028 | 5.8 | | — | | — | | — | | — | | — | | 25.0 | | 25.0 | | | — | | | 25.0 | |
| Term Loan 5 | 4.30% | 4.30% | 2029 | 6.7 | | — | | — | | — | | — | | — | | 25.0 | | 25.0 | | | — | | | 25.0 | |
| Subtotal / Wtd Avg | | 4.59% | | 3.7 | | $ | 13.0 | | $ | 27.0 | | $ | 38.3 | | $ | 67.0 | | $ | 37.1 | | $ | 68.0 | | $ | 250.4 | | | $ | (0.2) | | | $ | 250.2 | |
| | | | | | | | | | | | | | | | |
| Revolving Credit Facilities: | | | | | | | | | | | | | | | | |
| A&B Revolver | (3) | 5.94% | 2025 | 2.4 | | $ | — | | $ | — | | $ | 37.0 | | $ | — | | $ | — | | $ | — | | $ | 37.0 | | | $ | — | | | $ | 37.0 | |
| Subtotal / Wtd Avg | | 5.94% | | 2.4 | | $ | — | | $ | — | | $ | 37.0 | | $ | — | | $ | — | | $ | — | | $ | 37.0 | | | $ | — | | | $ | 37.0 | |
| Total / Wtd Avg | | 4.37% | | 3.2 | | $ | 17.0 | | $ | 161.9 | | $ | 77.4 | | $ | 69.2 | | $ | 40.9 | | $ | 113.0 | | $ | 479.4 | | | $ | (0.2) | | | $ | 479.2 | |
| | | | | | | | | | | | | | | | |
| (1) Financing lease has a discount rate of 4.14%. |
| (2) Loan has a stated interest rate of LIBOR plus 1.35%, but is swapped through maturity to a 3.14% fixed rate. |
| (3) Loan has a stated interest rate of LIBOR plus 1.05% based on a pricing grid. |
| | | | | | | | | | | | | | | | |
Alexander & Baldwin, Inc.
Financial Summary
Table 6 – Capitalization & Financial Ratios
(dollars in millions, except stock price; unaudited) | | | | | | | | | | | |
| Debt | | | |
| Secured debt | | | $ | 192.0 |
| Unsecured term debt | | | 250.2 |
| Unsecured revolving credit facility | | | 37.0 |
| Total debt (A) | | | $ | 479.2 |
| Add: Net unamortized deferred financing cost / discount (premium) | | | 0.2 |
| Less: Cash and cash equivalents | | | (10.7) | |
| Net Debt | | | $ | 468.7 |
| | | |
| Market Capitalization | Shares | Stock Price | Market Value |
| Common stock (NYSE:ALEX) | 72,593,773 | $18.91 | $ | 1,372.7 |
| Total equity market capitalization (B) | | | $ | 1,372.7 |
| | | |
| Total Market Capitalization (C) = (A) + (B) | | | $ | 1,851.9 |
| Total Debt to Total Market Capitalization (A) / (C) | | | 25.9 | % |
| | | |
| Liquidity | | | |
| Cash on hand | | | $ | 10.7 |
| Unused committed line of credit | | | 461.9 |
| Total liquidity | | | $ | 472.6 |
| | | |
| Financial Ratios | | | |
Net Debt to TTM Consolidated Adjusted EBITDA1 | | | 3.0 |
Debt-service Coverage Ratio2 | | | 3.0 |
| Fixed-rate debt to total debt | | | 92.3% |
Unencumbered CRE Property Ratio3 | | | 77.4% |
1 Consolidated Adjusted EBITDA for the trailing twelve months is $156.0 million and is calculated on Table 7.
2 The ratio of Consolidated Adjusted EBITDA ($156.0 million) to the sum of debt service ($52.2 million) – which includes interest expense, principal payments for financing leases and term debt, as well as principal amortization of mortgage debt, but excludes balloon payments – for the trailing twelve months.
3 Measured using gross book value, represents unencumbered CRE property ($1,231.8 million) as a percent of total CRE property ($1,592.1 million).
Alexander & Baldwin, Inc.
Financial Summary
Table 7 – Consolidated Metrics (amounts in millions, except per share data; unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | |
| Consolidated EBITDA & Consolidated Adjusted EBITDA | | | | | | | | |
| | | | | | | | | | |
| | Three Months Ended March 31, | | | | TTM March 31, |
| | 2023 | | 2022 | | | | | | 2023 |
| Net Income (Loss) | | $ | 5.3 | | | $ | 11.0 | | | | | | | $ | (55.2) | |
| Adjustments: | | | | | | | | | | |
| Depreciation and amortization | | 9.2 | | | 9.9 | | | | | | | 37.3 | |
| Interest expense | | 5.0 | | | 5.7 | | | | | | | 21.3 | |
| Income tax expense (benefit) | | — | | | — | | | | | | | (18.3) | |
| Depreciation and amortization related to discontinued operations | | — | | | 1.4 | | | | | | | 4.4 | |
| Interest expense related to discontinued operations | | 0.2 | | | — | | | | | | | 0.4 | |
| Consolidated EBITDA | | $ | 19.7 | | | $ | 28.0 | | | | | | | $ | (10.1) | |
| Asset impairments related to the Land Operations Segment | | — | | | — | | | | | | | 5.0 | |
| Pension termination | | — | | | 3.2 | | | | | | | 73.7 | |
| (Income) loss from discontinued operations, net of income taxes and excluding depreciation, amortization and interest expense | | 4.0 | | | (2.8) | | | | | | | 87.4 | |
| Consolidated Adjusted EBITDA | | $ | 23.7 | | | $ | 28.4 | | | | | | | $ | 156.0 | |
| | | | | | | | | | |
| Other discrete items impacting the respective periods - income/(loss): | | | | | | | | |
| Income (loss) attributable to discontinued noncontrolling interest | | $ | — | | | $ | 0.5 | | | | | | | $ | 0.6 | |
| | | | | | | | | | |
| Gain (loss) on disposal of non-core assets, net | | $ | 1.1 | | | $ | — | | | | | | | $ | 55.1 | |
| | | | | | | | | | | | | | | | | | |
| FFO & Core FFO | | | | | | | | |
| | | | | | | | |
| | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| Net Income (Loss) available to A&B common shareholders | | $ | 5.3 | | | $ | 10.5 | | | | | |
| Depreciation and amortization of commercial real estate properties | | 9.1 | | | 9.2 | | | | | |
| | | | | | | | |
| | | | | | | | |
| (Income) loss from discontinued operations, net of income taxes | | 4.2 | | | (1.4) | | | | | |
| Income (loss) attributable to discontinued noncontrolling interest | | — | | | 0.5 | | | | | |
| FFO | | $ | 18.6 | | | $ | 18.8 | | | | | |
| Exclude items not related to core business: | | | | | | | | |
| Land Operations operating (profit) loss | | 0.1 | | | (1.7) | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Non-core business interest expense | | 2.5 | | | 2.8 | | | | | |
| Pension termination - CRE and Corporate | | — | | | 0.9 | | | | | |
| Core FFO | | $ | 21.2 | | | $ | 20.8 | | | | | |
| | | | | | | | | | | | | | | | | | |
| Commercial Real Estate Operating Profit (Loss) | | $ | 20.9 | | | $ | 20.7 | | | | | |
| Depreciation and amortization of commercial real estate properties | | 9.1 | | | 9.2 | | | | | |
| Corporate and other expense | | (6.3) | | | (7.1) | | | | | |
| Core business interest expense | | (2.5) | | | (2.9) | | | | | |
| | | | | | | | |
| Pension termination - CRE and Corporate | | — | | | 0.9 | | | | | |
| Core FFO | | $ | 21.2 | | | $ | 20.8 | | | | | |
| | | | | | | | |
| Net income available to A&B common shareholders per diluted share | | $ | 0.07 | | | $ | 0.14 | | | | | |
| FFO per diluted share | | $ | 0.26 | | | $ | 0.26 | | | | | |
| Core FFO per diluted share | | $ | 0.29 | | | $ | 0.29 | | | | | |
| Weighted average diluted shares outstanding (FFO/Core FFO) | | 72.6 | | | 72.8 | | | | | |
| | | | | | | | | | | | | | | | | | |
| Other Discrete Items | | | | | | | | |
| | | | | | | | |
| | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| Other discrete items impacting the respective periods - income/(loss): | | | | | | | | |
| CRE segment straight-line lease adjustments | | $ | 1.3 | | | $ | 1.5 | | | | | |
| CRE segment favorable/(unfavorable) lease amortization | | $ | 0.3 | | | $ | 0.2 | | | | | |
| Consolidated share-based compensation | | $ | (1.6) | | | $ | (1.5) | | | | | |
Commercial Real Estate
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 8 – CRE Metrics (dollars in millions; unaudited)
| | | | | | | | | | | | | | | | | | |
| NOI and Same-Store NOI | | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| Operating Revenue: | |
| |
| | | | |
| Base rental income, net | | $ | 33.0 | | | $ | 31.9 | | | | | |
| Percentage rent | | 2.1 | | | 2.1 | | | | | |
| Recoveries from tenants | | 11.1 | | | 9.7 | | | | | |
| Excise tax recoveries from tenants | | 2.1 | | | 2.0 | | | | | |
| Revenues deemed uncollectible, net | | (0.7) | | | 0.3 | | | | | |
| Other revenue | | 0.3 | | | 0.3 | | | | | |
| Total Commercial Real Estate operating revenue | | $ | 47.9 | | | $ | 46.3 | | | | | |
| Operating Costs and Expenses: | | | | | | | | |
| Property operations | | 12.3 | | | 11.4 | | | | | |
| Property taxes | | 3.6 | | | 3.4 | | | | | |
| Depreciation and amortization | | 9.1 | | | 9.2 | | | | | |
| Total Commercial Real Estate operating costs and expenses | | $ | 25.0 | | | $ | 24.0 | | | | | |
| Selling, general and administrative | | (2.0) | | | (1.6) | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Operating Profit (Loss) | | $ | 20.9 | | | $ | 20.7 | | | | | |
| Plus: Depreciation and amortization | | 9.1 | | | 9.2 | | | | | |
| Less: Straight-line lease adjustments | | (1.3) | | | (1.5) | | | | | |
| Less: Favorable/(unfavorable) lease amortization | | (0.3) | | | (0.2) | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Plus: Selling, general, administrative and other expenses | | 2.0 | | | 1.6 | | | | | |
| NOI | | $ | 30.4 | | | $ | 29.8 | | | | | |
| Less: NOI from acquisitions, dispositions and other adjustments | | — | | | (0.1) | | | | | |
| Same-Store NOI | | $ | 30.4 | | | $ | 29.7 | | | | | |
| | | | |
| | | | | | | | |
| Occupancy: | | | | | | | | |
| Leased Occupancy | | 93.9 | % | | 94.5 | % | | | | |
| Physical Occupancy | | 93.3 | % | | 94.1 | % | | | | |
| Economic Occupancy | | 92.4 | % | | 92.0 | % | | | | |
| | | | | | | | |
|
| | | | | | | | |
| Other Discrete Items | | | | | | | | |
| | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| CRE segment capital expenditures: | | | | | | | | |
| | | | | | | | |
| Development and redevelopment | | $ | 1.3 | | | $ | 1.1 | | | | | |
| CRE building/area improvements (Maintenance Capital Expenditures) | | 1.1 | | | 0.5 | | | | | |
| CRE tenant space improvements (Maintenance Capital Expenditures) | | 0.6 | | | 0.2 | | | | | |
| | | | | | | | |
| Total CRE capital expenditures | | $ | 3.0 | | | $ | 1.8 | | | | | |
| | | | | | | | |
| Leasing commissions paid: | | $ | 0.3 | | | $ | 0.4 | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Commercial Real Estate EBITDA | | | | | | | | | | |
| | | | | | | | | | |
| | Three Months Ended March 31, | | | | |
| | 2023 | | 2022 | | | | | | |
| Commercial Real Estate Operating Profit (Loss) | | $ | 20.9 | | | $ | 20.7 | | | | | | | |
| Depreciation and amortization | | 9.1 | | | 9.2 | | | | | | | |
| Commercial Real Estate EBITDA | | $ | 30.0 | | | $ | 29.9 | | | | | | | |
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 9 – Occupancy (unaudited)
| | | | | | | | | | | | | | | | | | | | |
| Leased Occupancy |
| | | | | | |
| | As of | | As of | | Basis Point Change |
| | March 31, 2023 | | March 31, 2022 | |
| Retail | | 93.6% | | 93.1% | | 50 |
| Industrial | | 95.2% | | 98.0% | | (280) |
| Office | | 87.1% | | 87.7% | | (60) |
| Total Leased Occupancy | | 93.9% | | 94.5% | | (60) |
| | | | | | | | | | | | | | | | | | | | |
| Economic Occupancy |
| | | | | | |
| | As of | | As of | | Basis Point Change |
| | March 31, 2023 | | March 31, 2022 | |
| Retail | | 91.7% | | 89.7% | | 200 |
| Industrial | | 94.6% | | 97.3% | | (270) |
| Office | | 86.5% | | 85.9% | | 60 |
| Total Economic Occupancy | | 92.4% | | 92.0% | | 40 |
| | | | | | | | | | | | | | | | | | | | |
| Same-Store Leased Occupancy |
| | As of | | As of | | Basis Point Change |
| | March 31, 2023 | | March 31, 2022 | |
| Retail | | 93.6% | | 93.1% | | 50 |
| Industrial | | 95.1% | | 98.0% | | (290) |
| Office | | 87.1% | | 87.7% | | (60) |
| Total Same-Store Leased Occupancy | | 93.9% | | 94.5% | | (60) |
| | | | | | | | | | | | | | | | | | | | |
| Same-Store Economic Occupancy |
| | As of | | As of | | Basis Point Change |
| | March 31, 2023 | | March 31, 2022 | |
| Retail | | 91.7% | | 89.7% | | 200 |
| Industrial | | 94.5% | | 97.3% | | (280) |
| Office | | 86.5% | | 85.9% | | 60 |
| Total Same-Store Economic Occupancy | | 92.4% | | 92.0% | | 40 |
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 10 – NOI and Same-Store NOI by Type (dollars in thousands; unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| NOI | | | | |
| Three Months Ended March 31, | | Percentage Change | | Q1 2023 as a % of NOI | | Q1 2022 as a % of NOI |
| 2023 | | 2022 | | | |
| Retail | $ | 19,721 | | | $ | 19,457 | | | 1.4% | | 64.8% | | 65.4% |
| Industrial | 4,863 | | | 4,966 | | | (2.1)% | | 16.0% | | 16.7% |
| Ground | 4,720 | | | 4,335 | | | 8.9% | | 15.5% | | 14.6% |
| Office | 1,124 | | | 1,009 | | | 11.4% | | 3.7% | | 3.3% |
| Total Hawai‘i Portfolio | 30,428 | | | 29,767 | | | 2.2% | | 100.0% | | 100.0% |
| Other | (1) | | | — | | | NM | | —% | | —% |
| Total CRE Portfolio | $ | 30,427 | | | $ | 29,767 | | | 2.2% | | 100.0% | | 100.0% |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Same-Store NOI | | | | |
| Three Months Ended March 31, | | Percentage Change | | Q1 2023 as a % of NOI | | Q1 2022 as a % of NOI |
| 2023 | | 2022 | | | |
| Retail | $ | 19,721 | | | $ | 19,457 | | | 1.4% | | 64.9% | | 65.4% |
| Industrial | 4,827 | | | 4,966 | | | (2.8)% | | 15.9% | | 16.7% |
| Ground | 4,713 | | | 4,313 | | | 9.3% | | 15.5% | | 14.5% |
| Office | 1,124 | | | 1,009 | | | 11.4% | | 3.7% | | 3.4% |
| Total CRE Portfolio | $ | 30,385 | | | $ | 29,745 | | | 2.2% | | 100.0% | | 100.0% |
Changes in the Same-Store portfolio as it relates to the comparable prior period and the current period are as follows:
| | | | | | | | | | | | | | | | | |
| Dispositions | | Additions | | |
| Date | Property | | Date | Property | | | |
| 2/23 | Residual Kauai land | | 1/22 | Kahai Street Industrial | | | |
| | | 1/22 | 228 Kalihi Street | | | |
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 11 – Improved Property Report (dollars in thousands, except per square foot data; unaudited) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property | | Island | Year Built/
Renovated | Current
GLA (SF) | Leased / Economic Occupancy | ABR | ABR
PSF | Q1 2023 NOI | Q1 2023 % NOI to Improved Portfolio NOI | Retail Anchor Tenants |
| Retail: | | | | | | | | | | | |
| 1 | Pearl Highlands Center | | Oahu | 1992-1994 | 412,200 | 99.7% | 99.7% | $10,835 | $26.38 | $3,026 | 11.7% | Sam's Club, Regal Cinemas, 24 Hour Fitness, Ulta Salon, Ross |
| 2 | Kailua Retail | | Oahu | 1947-2014 | 326,100 | 95.3% | 93.6% | 12,013 | 39.36 | 2,993 | 11.6% | Whole Foods Market, Foodland, CVS/Longs Drugs, Ulta Salon |
| 3 | Laulani Village | | Oahu | 2012 | 175,600 | 96.5% | 96.5% | 6,664 | 39.32 | 1,547 | 6.0% | Safeway, Ross, Walgreens, Petco |
| 4 | Waianae Mall | | Oahu | 1975 | 170,800 | 95.4% | 94.7% | 3,966 | 25.18 | 976 | 3.8% | CVS/Longs Drugs, City Mill |
| 5 | Manoa Marketplace | | Oahu | 1977 | 142,000 | 97.8% | 92.2% | 4,581 | 35.19 | 1,296 | 5.0% | Safeway, CVS/Longs Drugs |
| 6 | Queens' MarketPlace | | Hawai‘i Island | 2007 | 134,000 | 86.0% | 84.0% | 4,437 | 47.51 | 1,231 | 4.8% | Island Gourmet Market |
| 7 | Kaneohe Bay Shopping Center (Leasehold) | | Oahu | 1971 | 125,500 | 97.2% | 95.3% | 3,012 | 25.17 | 558 | 2.2% | Safeway, CVS/Longs Drugs |
| 8 | Hokulei Village | | Kauai | 2015 | 119,000 | 98.0% | 98.0% | 4,292 | 36.81 | 1,043 | 4.1% | Safeway, Petco |
| 9 | Pu‘unene Shopping Center | | Maui | 2017 | 118,000 | 79.4% | 70.9% | 4,117 | 49.20 | 985 | 3.8% | Planet Fitness, Petco, Ulta Salon, Target (shadow-anchored) |
| 10 | Waipio Shopping Center | | Oahu | 1986, 2004 | 113,800 | 97.4% | 97.4% | 3,612 | 32.57 | 863 | 3.4% | Foodland |
| 11 | Aikahi Park Shopping Center | | Oahu | 1971, 2022 | 97,300 | 88.5% | 84.5% | 3,089 | 37.55 | 790 | 3.1% | Safeway |
| 12 | Lanihau Marketplace | | Hawai‘i Island | 1987 | 88,300 | 97.7% | 92.4% | 1,605 | 19.68 | 369 | 1.4% | Sack N Save, CVS/Longs Drugs |
| 13 | The Shops at Kukui‘ula | | Kauai | 2009 | 85,900 | 95.6% | 90.1% | 3,651 | 48.23 | 920 | 3.6% | CVS/Longs Drugs, Eating House, Living Foods |
| 14 | Ho‘okele Shopping Center | | Maui | 2019 | 71,400 | 96.1% | 94.7% | 2,803 | 41.48 | 559 | 2.2% | Safeway |
| 15 | Kunia Shopping Center | | Oahu | 2004 | 60,600 | 93.4% | 93.4% | 2,237 | 40.26 | 649 | 2.5% | |
| 16 | Waipouli Town Center | | Kauai | 1980 | 56,600 | 39.7% | 37.6% | 465 | 21.86 | 181 | 0.7% | Autozone |
| 17 | Kahului Shopping Center | | Maui | 1951 | 50,900 | 84.5% | 84.5% | 814 | 18.91 | 77 | 0.3% | |
| 18 | Lau Hala Shops | | Oahu | 2018 | 46,300 | 100.0% | 98.3% | 2,620 | 57.62 | 557 | 2.2% | UFC Gym, Down to Earth |
| 19 | Napili Plaza | | Maui | 1991 | 45,600 | 90.3% | 90.3% | 1,272 | 31.85 | 337 | 1.3% | Napili Market |
| 20 | Gateway at Mililani Mauka | | Oahu | 2008, 2013 | 34,900 | 93.7% | 90.3% | 1,899 | 60.33 | 472 | 1.8% | CVS/Longs Drugs (shadow-anchored) |
| 21 | Port Allen Marina Center | | Kauai | 2002 | 23,600 | 92.0% | 92.0% | 659 | 30.41 | 199 | 0.8% | |
| 22 | The Collection | | Oahu | 2017 | 5,900 | 100.0% | 100.0% | 343 | 58.14 | 93 | 0.4% | |
| Subtotal – Retail | | | | 2,504,300 | 93.6% | 91.7% | $78,986 | $34.81 | $19,721 | 76.7% | |
| | | | | | | | | | | | |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property | | Island | Year Built/
Renovated | Current
GLA (SF) | Leased / Economic Occupancy | ABR | ABR
PSF | Q1 2023 NOI | Q1 2023 % NOI to Improved Portfolio NOI | Retail Anchor Tenants |
| Industrial: | | | | | | | | | | | |
| 23 | Komohana Industrial Park | | Oahu | 1990 | 238,300 | 100.0% | 100.0% | $3,583 | $15.04 | $1,400 | 5.4% | |
| 24 | Kaka‘ako Commerce Center | | Oahu | 1969 | 202,200 | 81.9% | 81.9% | 2,359 | 14.42 | 365 | 1.4% | |
| 25 | Waipio Industrial | | Oahu | 1988-1989 | 158,400 | 89.4% | 88.3% | 2,354 | 16.82 | 634 | 2.5% | |
| 26 | Opule Industrial | | Oahu | 2005-2006, 2018 | 151,500 | 100.0% | 100.0% | 2,627 | 17.34 | 667 | 2.6% | |
| 27 | P&L Warehouse | | Maui | 1970 | 104,100 | 100.0% | 100.0% | 1,614 | 15.50 | 425 | 1.7% | |
| 28 | Kapolei Enterprise Center | | Oahu | 2019 | 93,000 | 100.0% | 100.0% | 1,618 | 17.39 | 382 | 1.5% | |
| 29 | Honokohau Industrial | | Hawai‘i Island | 2004-2006, 2008 | 86,700 | 98.0% | 98.0% | 1,307 | 15.38 | 302 | 1.2% | |
| 30 | Kailua Industrial/Other | | Oahu | 1951-1974 | 69,000 | 96.1% | 92.6% | 1,150 | 18.43 | 207 | 0.8% | |
| 31 | Port Allen | | Kauai | 1983, 1993 | 64,600 | 95.6% | 90.2% | 695 | 12.70 | 173 | 0.7% | |
| 32 | Harbor Industrial | | Maui | 1930 | 51,100 | 100.0% | 100.0% | 699 | 13.69 | 208 | 0.8% | |
| 33 | Kahai Street Industrial | | Oahu | 1973 | 27,900 | 100.0% | 100.0% | 365 | 13.09 | 64 | 0.2% | |
| 34 | Maui Lani Industrial | (1) | Maui | 2010 | 8,400 | 100.0% | 100.0% | 151 | 17.98 | 36 | 0.1% | |
| Subtotal – Industrial | | | | 1,255,200 | 95.2% | 94.6% | $18,522 | $15.70 | $4,863 | 18.9% | |
| | | | | | | | | | | | |
| Office: | | | | | | | | | | | |
| 35 | Kahului Office Building | | Maui | 1974 | 59,100 | 86.6% | 86.6% | $1,681 | $32.82 | $426 | 1.7% | |
| 36 | Gateway at Mililani Mauka South | | Oahu | 1992, 2006 | 37,100 | 98.4% | 96.2% | 1,702 | 47.65 | 432 | 1.7% | |
| 37 | Kahului Office Center | | Maui | 1991 | 35,800 | 90.5% | 90.5% | 1,014 | 31.27 | 286 | 1.1% | |
| 38 | Lono Center | | Maui | 1973 | 13,700 | 49.9% | 49.9% | 255 | 37.43 | (20) | (0.1)% | |
| Subtotal – Office | | | | 145,700 | 87.1% | 86.5% | $4,652 | $36.87 | $1,124 | 4.4% | |
| Total – Hawai‘i Improved Portfolio | | 3,905,200 | 93.9% | 92.4% | $102,160 | $28.58 | $25,708 | 100.0% | |
| | | | | | | | | | | | |
| (1) Property is currently not included in the Same-Store pool. |
|
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 12 – Ground Lease Report (dollars in thousands; unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Property Name | | Location
(City, Island) | Acres | Property Type | Exp. Year | Current ABR | Q1 2023 NOI | Next Rent Step | Step Type | Next ABR ($ in $000) | Previous Rent Step | Previous Step Type | Previous ABR ($ in $000) |
| 1 | Owner/Operator | | Kapolei, Oahu | 36.4 | Industrial | 2025 | $ | 3,300 | | $ | 825 | | 2023 | Fixed Step | $3,420 | 2023 | Fixed Step | $3,203 |
| 2 | Windward City Shopping Center | | Kaneohe, Oahu | 15.4 | Retail | 2035 | 2,800 | | 698 | | 2023 | FMV Reset | FMV | 2017 | Fixed Step | 2,100 |
| 3 | Owner/Operator | | Honolulu, Oahu | 9.0 | Retail | 2045 | 2,075 | | 519 | | 2025 | Fixed Step | 2,283 | 2020 | Fixed Step | 1,886 |
| 4 | Kaimuki Shopping Center | | Honolulu, Oahu | 2.8 | Retail | 2040 | 2,039 | | 509 | | 2026 | Fixed Step | 2,345 | 2022 | FMV Reset | 1,728 |
| 5 | S&F Industrial | | Pu'unene, Maui | 52.0 | Heavy Industrial | 2059 | 1,275 | | 365 | | 2024 | Fixed Step | 1,433 | 2019 | Fixed Step | 751 |
| 6 | Pali Palms Plaza | | Kailua, Oahu | 3.3 | Office | 2037 | 992 | | 248 | | 2032 | FMV Reset | FMV | 2022 | Negotiated | 200 |
| 7 | Owner/Operator | | Kaneohe, Oahu | 3.7 | Retail | 2048 | 990 | | 247 | | 2023 | Fixed Step | 1,059 | 2018 | Option | 694 |
| 8 | Windward Town and Country Plaza I | | Kailua, Oahu | 3.4 | Retail | 2062 | 963 | | 241 | | 2032 | Fixed Step | 1,233 | 2022 | Fixed Step | 753 |
| 9 | Windward Town and Country Plaza II | | Kailua, Oahu | 2.2 | Retail | 2062 | 621 | | 155 | | 2032 | Fixed Step | 795 | 2022 | Fixed Step | 485 |
| 10 | Kailua Post Office | | Kailua, Oahu | 1.2 | Retail | 2023 | 555 | | 101 | | — | — | — | 2023 | Negotiated | 237 |
| 11 | Owner/Operator | | Kailua, Oahu | 1.9 | Retail | 2034 | 450 | | 64 | | 2024 | Fixed Step | 470 | 2019 | Negotiated | 641 |
| 12 | Owner/Operator | | Honolulu, Oahu | 0.5 | Retail | 2028 | 385 | | 97 | | 2024 | Fixed Step | 394 | 2023 | Fixed Step | 375 |
| 13 | Owner/Operator | | Honolulu, Oahu | 0.5 | Parking | 2028 | 349 | | 87 | | 2023 | Fixed Step | 359 | 2022 | Fixed Step | 339 |
| 14 | Owner/Operator | | Kahului, Maui | 0.8 | Retail | 2026 | 264 | | 66 | | 2023 | Fixed Step | 272 | 2022 | Fixed Step | 257 |
| 15 | Seven Eleven Kailua Center | | Kailua, Oahu | 0.9 | Retail | 2033 | 263 | | 66 | | 2024 | FMV Reset | FMV | 2023 | Fixed Step | 258 |
| 16 | Owner/Operator | | Honolulu, Oahu | 0.7 | Industrial | 2027 | 252 | | 63 | | 2024 | Fixed Step | 259 | 2023 | Option | 245 |
| 17 | Owner/Operator | | Kahului, Maui | 0.8 | Industrial | 2025 | 228 | | 57 | | 2023 | Fixed Step | 238 | 2022 | Fixed Step | 218 |
| 18 | Owner/Operator | | Kailua, Oahu | 0.4 | Retail | 2025 | 183 | | 46 | | 2024 | Fixed Step | 189 | 2023 | Fixed Step | 174 |
| 19 | Owner/Operator | | Kahului, Maui | 0.4 | Retail | 2027 | 181 | | 66 | | 2023 | Fixed Step | 186 | 2022 | Fixed Step | 158 |
| 20 | Owner/Operator | | Kahului, Maui | 0.9 | Retail | 2025 | 146 | | 37 | | 2024 | Fixed Step | 151 | 2023 | Fixed Step | 142 |
| Remainder | | Various | 4.8 | Various | Various | 809 | | 163 | | Various | Various | — | — | — | — |
| Total - Ground Leases | 142.0 | | | | $ | 19,120 | | $ | 4,720 | | | | | | | |
| |
| |
| |
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 13 – Top 10 Tenants Ranked by ABR
(dollars in thousands; unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Tenant1 | Number of Leases | | ABR | | % of Total Improved
Portfolio
ABR | | GLA (SF) | | % of Total
Improved Portfolio
GLA |
| Albertsons Companies (including Safeway) | 7 | | $ | 7,608 | | | 6.9% | | 286,024 | | 7.3% |
| Sam's Club | 1 | | 3,308 | | | 3.0% | | 180,908 | | 4.6% |
| CVS Corporation (including Longs Drugs) | 6 | | 2,983 | | | 2.7% | | 150,411 | | 3.9% |
| Foodland Supermarket & related companies | 7 | | 2,130 | | | 1.9% | | 113,725 | | 2.9% |
| Coleman World Group | 2 | | 2,004 | | | 1.8% | | 115,495 | | 3.0% |
| Ross Dress for Less | 2 | | 1,992 | | | 1.8% | | 65,484 | | 1.7% |
GP/RM Prestress, LLC2 | 1 | | 1,746 | | | 1.6% | | N/A | | N/A |
| 24 Hour Fitness USA | 1 | | 1,513 | | | 1.4% | | 45,870 | | 1.2% |
| Ulta Salon, Cosmetics, & Fragrance, Inc. | 3 | | 1,508 | | | 1.4% | | 33,985 | | 0.9% |
| Petco Animal Supplies Stores | 3 | | 1,448 | | | 1.3% | | 34,282 | | 0.9% |
| Total | 33 | | $ | 26,240 | | | 23.8% | | 1,026,184 | | 26.4% |
| | | | | | | | | |
1 The table excludes ground leases as such leases would not be comparable from a GLA perspective. |
2 The leased premises in the GP/RM Prestress, LLC lease includes warehouse and yard space. Due to the yard space, GLA is not presented due to lack of comparability. |
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 14 – Lease Expiration Schedule
(dollars in thousands, except per square foot data; unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total Improved Portfolio |
| Expiration Year | | Number
of Leases | | Square
Footage of
Expiring Leases | | % of Total
Improved Portfolio
Leased GLA | | ABR
Expiring | | % of Total
Improved Portfolio
Expiring ABR | | ABR Expiring
PSF |
| 2023 | | 122 | | 249,470 | | | 7.0% | | $ | 7,488 | | 7.3% | | $ | 30.02 |
| 2024 | | 152 | | 564,999 | | | 15.8% | | 15,355 | | 15.0% | | 27.18 |
| 2025 | | 112 | | 484,225 | | | 13.5% | | 12,119 | | 11.9% | | 25.03 |
| 2026 | | 98 | | 310,329 | | | 8.7% | | 8,803 | | 8.6% | | 28.37 |
| 2027 | | 100 | | 307,953 | | | 8.6% | | 10,631 | | 10.4% | | 34.52 |
| 2028 | | 61 | | 270,448 | | | 7.6% | | 10,198 | | 10.0% | | 37.71 |
| 2029 | | 39 | | 226,821 | | | 6.3% | | 8,351 | | 8.2% | | 36.82 |
| 2030 | | 19 | | 143,388 | | | 4.0% | | 3,291 | | 3.2% | | 22.95 |
| 2031 | | 12 | | 91,362 | | | 2.6% | | 2,289 | | 2.2% | | 25.05 |
| 2032 | | 22 | | 117,270 | | | 3.3% | | 4,117 | | 4.0% | | 35.11 |
| Thereafter | | 34 | | 633,169 | | | 17.7% | | 15,494 | | 15.3% | | 24.47 |
| Month-to-month | | 110 | | 175,473 | | | 4.9% | | 4,024 | | 3.9% | | 22.93 |
| Total | | 881 | | 3,574,907 | | | 100.0% | | $ | 102,160 | | 100.0% | | $ | 28.58 |
| | | | | | | | | | | | |
| Retail Portfolio |
| Expiration Year | | Number
of Leases | | Square
Footage of
Expiring Leases | | % of Total
Retail
Leased GLA | | ABR
Expiring | | % of Total
Retail
Expiring ABR | | ABR Expiring
PSF |
| 2023 | | 92 | | 179,489 | | | 7.9% | | $ | 6,207 | | 7.9% | | $ | 34.58 |
| 2024 | | 100 | | 357,307 | | | 15.8% | | 11,490 | | 14.6% | | 32.16 |
| 2025 | | 79 | | 189,215 | | | 8.3% | | 7,126 | | 9.0% | | 37.66 |
| 2026 | | 66 | | 83,772 | | | 3.7% | | 4,669 | | 5.9% | | 55.73 |
| 2027 | | 82 | | 159,062 | | | 7.0% | | 7,892 | | 10.0% | | 49.62 |
| 2028 | | 57 | | 225,540 | | | 9.9% | | 9,385 | | 11.9% | | 41.61 |
| 2029 | | 34 | | 187,628 | | | 8.3% | | 7,417 | | 9.4% | | 39.53 |
| 2030 | | 15 | | 61,073 | | | 2.7% | | 1,750 | | 2.2% | | 28.65 |
| 2031 | | 10 | | 63,482 | | | 2.8% | | 1,924 | | 2.4% | | 30.31 |
| 2032 | | 19 | | 100,480 | | | 4.4% | | 3,817 | | 4.8% | | 37.99 |
| Thereafter | | 31 | | 600,719 | | | 26.5% | | 14,994 | | 19.0% | | 24.96 |
| Month-to-month | | 47 | | 60,986 | | | 2.7% | | 2,315 | | 2.9% | | 37.96 |
| Total | | 632 | | 2,268,753 | | | 100.0% | | $ | 78,986 | | 100.0% | | $ | 34.81 |
| | | | | | | | | | | | |
| Industrial Portfolio |
| Expiration Year | | Number
of Leases | | Square
Footage of
Expiring Leases | | % of Total
Industrial
Leased GLA | | ABR
Expiring | | % of Total
Industrial
Expiring ABR | | ABR Expiring
PSF |
| 2023 | | 24 | | 61,173 | | | 5.2% | | $ | 978 | | 5.3% | | $ | 15.99 |
| 2024 | | 37 | | 168,889 | | | 14.3% | | 2,647 | | 14.3% | | 15.67 |
| 2025 | | 27 | | 279,944 | | | 23.7% | | 4,442 | | 24.0% | | 15.87 |
| 2026 | | 27 | | 207,821 | | | 17.6% | | 3,216 | | 17.4% | | 15.47 |
| 2027 | | 9 | | 133,587 | | | 11.3% | | 2,180 | | 11.8% | | 16.32 |
| 2028 | | 1 | | 40,505 | | | 3.4% | | 684 | | 3.7% | | 16.89 |
| 2029 | | 3 | | 27,763 | | | 2.4% | | 365 | | 2.0% | | 13.15 |
| 2030 | | 1 | | 74,990 | | | 6.4% | | 1,320 | | 7.1% | | 17.60 |
| 2031 | | 2 | | 27,880 | | | 2.4% | | 365 | | 2.0% | | 13.09 |
| 2032 | | 2 | | 15,400 | | | 1.3% | | 251 | | 1.4% | | 16.30 |
| Thereafter | | 3 | | 32,450 | | | 2.8% | | 500 | | 2.6% | | 15.41 |
| Month-to-month | | 57 | | 109,577 | | | 9.2% | | 1,574 | | 8.4% | | 14.36 |
| Total | | 193 | | 1,179,979 | | | 100.0% | | $ | 18,522 | | 100.0% | | $ | 15.70 |
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 15 – New & Renewal Lease Summary
(unaudited) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Comparable Leases Only1 |
| Total - New and Renewal Leases | Leases | GLA (SF) | New ABR/SF | TI / SF | Wtd Avg Lease Term (Years) | Leases | GLA (SF) | New ABR/SF | Old ABR/SF | Rent Spread2 |
| 1st Quarter 2023 | 49 | 139,302 | | $ | 30.66 | | $ | 4.09 | | 5.2 | 32 | 76,139 | | $ | 27.36 | | $ | 25.48 | | 7.4% |
| 4th Quarter 2022 | 61 | 129,537 | | $ | 30.65 | | $ | 3.22 | | 3.5 | 29 | 52,063 | | $ | 39.35 | | $ | 37.29 | | 5.5% |
| 3rd Quarter 2022 | 50 | 104,875 | | $ | 29.11 | | $ | 5.86 | | 5.8 | 27 | 69,731 | | $ | 26.63 | | $ | 25.55 | | 4.2% |
| 2nd Quarter 2022 | 76 | 174,073 | | $ | 30.71 | | $ | 9.28 | | 4.6 | 48 | 106,241 | | $ | 33.00 | | $ | 31.07 | | 6.2% |
| Trailing four quarters | 236 | 547,787 | | $ | 30.38 | | $ | 5.87 | | 4.7 | 136 | 304,174 | | $ | 31.21 | | $ | 29.47 | | 5.9% |
| | | | | | | | | | |
| Total - New Leases | Leases | GLA (SF) | New ABR/SF | TI / SF | Wtd Avg Lease Term (Years) | Leases | GLA (SF) | New ABR/SF | Old ABR/SF | Rent Spread2 |
| 1st Quarter 2023 | 14 | 22,912 | | $ | 36.41 | | $ | 21.92 | | 5.1 | 6 | 10,258 | | $ | 29.95 | | $ | 29.45 | | 1.7% |
| 4th Quarter 2022 | 21 | 32,435 | | $ | 28.93 | | $ | 11.10 | | 3.5 | 3 | 5,145 | | $ | 22.29 | | $ | 21.60 | | 3.2% |
| 3rd Quarter 2022 | 18 | 29,452 | | $ | 29.57 | | $ | 20.79 | | 4.8 | 6 | 10,148 | | $ | 25.11 | | $ | 23.60 | | 6.4% |
| 2nd Quarter 2022 | 24 | 59,145 | | $ | 28.52 | | $ | 26.92 | | 7.3 | 8 | 14,481 | | $ | 30.94 | | $ | 27.64 | | 11.9% |
| Trailing four quarters | 77 | 143,944 | | $ | 30.08 | | $ | 21.30 | | 5.6 | 23 | 40,032 | | $ | 28.10 | | $ | 26.30 | | 6.8% |
| | | | | | | | | | |
| Total - Renewal Leases | Leases | GLA (SF) | New ABR/SF | TI / SF | Wtd Avg Lease Term (Years) | Leases | GLA (SF) | New ABR/SF | Old ABR/SF | Rent Spread2 |
| 1st Quarter 2023 | 35 | 116,390 | | $ | 29.53 | | $ | 0.58 | | 5.2 | 26 | 65,881 | | $ | 26.95 | | $ | 24.87 | | 8.4% |
| 4th Quarter 2022 | 40 | 97,102 | | $ | 31.22 | | $ | 0.59 | | 3.5 | 26 | 46,918 | | $ | 41.22 | | $ | 39.01 | | 5.7% |
| 3rd Quarter 2022 | 32 | 75,423 | | $ | 28.93 | | $ | 0.03 | | 6.2 | 21 | 59,583 | | $ | 26.89 | | $ | 25.88 | | 3.9% |
| 2nd Quarter 2022 | 52 | 114,928 | | $ | 31.84 | | $ | 0.20 | | 3.2 | 40 | 91,760 | | $ | 33.32 | | $ | 31.61 | | 5.4% |
| Trailing four quarters | 159 | 403,843 | | $ | 30.48 | | $ | 0.37 | | 4.4 | 113 | 264,142 | | $ | 31.69 | | $ | 29.95 | | 5.8% |
| | | | | | | | | | |
| | | | | | | | | | |
| Three Months Ended March 31, 2023 | | | TTM Ended March 31, 2023 |
| Leases | GLA (SF) | ABR/SF | Rent Spread2 | | | Leases | GLA (SF) | ABR/SF | Rent Spread2 |
| Retail | 30 | 81,987 | | $ | 39.62 | | 6.0% | | Retail | 158 | 315,455 | | $ | 40.04 | | 5.5% |
| Industrial | 17 | 52,463 | | $ | 16.05 | | 10.2% | | Industrial | 67 | 210,205 | | $ | 15.37 | | 6.9% |
| Office | 2 | 4,852 | | $ | 37.14 | | 3.0% | | Office | 11 | 22,127 | | $ | 35.16 | | 8.1% |
1 Per Glossary of Terms, Comparable Leases are either renewals (executed for the same units) or new leases (executed for units that have been vacated in the previous 12 months) for comparable space and comparable lease terms. Expansions, contractions and strategic short-term renewals are excluded from the Comparable Lease pool.
2 Rent Spread is calculated for Comparable Leases, a subset of the total population of leases for the period presented.
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 16 – Portfolio Repositioning, Redevelopment & Development Summary
(dollars in millions; unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | Leasing Activity | |
Project | Phase | Target
In-service | Target
Stabilization | | Total Estimated
Project Capital
Costs | Project Capital
Costs Incurred
to Date | Estimated
Incremental
Stabilized
NOI | Estimated
Stabilized
Yield on Total
Project Capital
Costs | Projected
GLA (SF) | %
Leased | % Under Letter of Intent | Total | |
| Redevelopment | | | | | | | | | | | | | |
| Manoa Marketplace | Construction | 3Q2023 | 3Q20241 | | $8.0 - $8.8 | $3.9 | $0.6 - $0.7 | 8.0 - 8.5% | 142,000 | 97.8% | —% | 97.8% | |
| | | | | | | | | | | | | |
1 Property stabilized at over 90% leased prior to project commencement. The Company anticipates full incremental stabilized NOI in 2026. | |
| | | | | | | | | | | | | |
Alexander & Baldwin, Inc.
Commercial Real Estate
Table 17 – Transactional Activity (2022 - 2023)
(dollars in millions; unaudited)
| | | | | | | | | | | | | | | | | |
| Acquisitions | | | | | |
| Property | Type | Location | Date
(Month/Year) | Purchase Price | GLA (SF) |
| Maui Lani Industrial | Industrial | Maui, HI | 06/22 | N/A1 | 8,400 | |
| | | | | |
| | | | | |
| Total | | | | $ | — | | 8,400 | |
| | | | | |
1 Represents an intercompany acquisition transaction from GPRS, a subsidiary of Grace Pacific. |
| | | | | |
Land Operations
Alexander & Baldwin, Inc.
Land Operations
Table 18 – Statement of Operating Profit, EBITDA and Adjusted EBITDA (amounts in millions; unaudited)
| | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | |
| | 2023 | | 2022 | | | | |
| Development sales revenue | | $ | — | | | $ | 6.3 | | | | | |
| Unimproved/other property sales revenue | | 0.9 | | | 1.8 | | | | | |
Other operating revenue1 | | 1.6 | | | 4.8 | | | | | |
| Total Land Operations operating revenue | | $ | 2.5 | | | $ | 12.9 | | | | | |
| Land Operations operating costs and expenses | | (3.6) | | | (9.2) | | | | | |
| Selling, general and administrative | | (0.5) | | | (1.2) | | | | | |
| | | | | | | | |
| | | | | | | | |
| Gain (loss) on disposal of non-core assets, net | | 1.1 | | | — | | | | | |
| Earnings (loss) from joint ventures | | 0.4 | | | 1.4 | | | | | |
| Pension termination | | — | | | (2.3) | | | | | |
| Interest and other income (expense), net | | — | | | 0.1 | | | | | |
| Total Land Operations operating profit (loss) | | $ | (0.1) | | | $ | 1.7 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | | | TTM March 31, |
| | 2023 | | 2022 | | | | | | 2023 |
| Land Operations Operating Profit (Loss) | | $ | (0.1) | | | $ | 1.7 | | | | | | | $ | (3.2) | |
| Land Operations depreciation and amortization | | — | | | 0.6 | | | | | | | 0.6 | |
| Land Operations EBITDA | | $ | (0.1) | | | $ | 2.3 | | | | | | | $ | (2.6) | |
| Impairment of assets | | — | | | — | | | | | | | 5.0 | |
| Pension termination | | — | | | 2.3 | | | | | | | 59.9 | |
| Land Operations Adjusted EBITDA | | $ | (0.1) | | | $ | 4.6 | | | | | | | $ | 62.3 | |
| | | | | | | | | | |
1 Other operating revenue includes revenue related to trucking, renewable energy and licensing and leasing of non-core legacy agricultural lands. |
|
Alexander & Baldwin, Inc.
Land Operations
Table 19 – Core Real Estate Development-for-sale Projects
(dollars in millions, except per square foot amounts; unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Project | Location | Product Type | Remaining Sellable Acres1 | Avg Size of Remaining Lots
(Acres) | Target Sales Price
Range per SF for Remaining | Estimated Total Project Cost | Total Project Costs Incurred to Date | A&B Net
Book Value | | Estimated Project Completion |
| Maui Business Park (Phase II) | Kahului, Maui | Light industrial lots | 46.5 acres | 1.1 acres | $38-$58 per SF | $ | 98 | $ | 65 | $ | 22 | | 2030+ |
| | | | | | | | | | |
1 Decline in remaining sellable acres due to carveout of planned roads and easements for Ho'okele Condominium Project. | | | |
| | | | | | | | | | |
Alexander & Baldwin, Inc.
Land Operations
Table 20 – Components of Land Operations
(dollars in millions; unaudited)
| | | | | | | | | | | | | | |
| | Acres | | Carrying Value |
| ASSETS | | | | |
| Real estate investments | | | | |
| Core real estate investments | | | | |
| Kapolei Business Park West | | 3 | | | $ | 6.2 | |
| Maui Business Park II | | 53 | | | 22.1 | |
| Non-core real estate investments | | | | |
| Other real estate development | | 192 | | | $ | 37.8 | |
| Agricultural land | | 3,122 | | | 0.4 | |
| Urban land, not in active development | | 20 | | | 0.6 | |
| Conservation & preservation | | 777 | | | 0.9 | |
| | | | |
| | | | |
| Investments in real estate joint ventures and partnerships | | | | 7.5 | |
| Total real estate investments, net | | 4,167 | | | 75.5 | |
| Accounts receivable and other receivables, net | | | | 3.9 | |
| Other investments in affiliates | | | | 29.9 | |
| Other assets | | | | 0.8 | |
| Total assets | | | | $ | 110.1 | |
| | | | |
| LIABILITIES | | | | |
| Maui agricultural land sale deferred revenue and reserves | | | | $ | 75.2 | |
| Environmental remediation | | | | 16.4 | |
| Land development warranty and post-closing obligations | | | | 4.0 | |
| Other liabilities | | | | 8.8 | |
| Total liabilities | | | | $ | 104.4 | |
| | | | |
| Land Operations Book Value | | | | $ | 5.7 | |
