Exhibit 99.2
Pro Forma Condensed Consolidated Balance Sheet
June 2013
(Unaudited)
(In thousands, except share and per share data)
| | Pro Forma
Physicians
Realty Trust
Prior to
Acquisition | | Acquisition of
6800 Preston
Road | | Pro Forma
Reflecting
Acquisition | |
| | (unaudited) | | | | | |
ASSETS | | | | | | | |
Real estate investments: | | | | | | | |
Income producing property | | $ | 90,085 | | $ | 11,689 | (1) | $ | 101,774 | |
Tenant improvements | | 5,192 | | — | | 5,192 | |
Property under development | | 675 | | — | | 675 | |
Land | | 15,464 | | 3,370 | (1) | 18,834 | |
| | 111,416 | | 15,059 | | 126,475 | |
Accumulated depreciation | | (18,043 | ) | — | | (18,043 | ) |
Real estate investments, net | | 93,373 | | 15,059 | | 108,432 | |
Cash and cash equivalents | | 88,324 | | (18,200 | )(2) | 70,124 | |
Accounts receivables (Net of allowance for doubtful accounts of $132 as of June 30, 2013) | | 557 | | — | | 557 | |
Deferred costs | | 1,550 | | — | | 1,550 | |
Lease intangibles, net | | 4,881 | | 3,141 | (1) | 8,022 | |
Other assets | | 3,276 | | — | | 3,276 | |
Total Assets | | $ | 191,961 | | $ | — | | $ | 191,961 | |
LIABILITIES AND EQUITY | | | | | | | |
Accounts Payable | | 458 | | — | | 458 | |
Accrued expenses and other liabilities | | 1,272 | | — | | 1,272 | |
Derivative liabilities | | 453 | | — | | 453 | |
Notes payable | | 46,902 | | — | | 46,902 | |
Total Liabilities | | 49,085 | | — | | 49,085 | |
Shareholders equity | | 125,132 | | — | | 125,132 | |
Noncontrolling interest in operating partnership | | 18,254 | | — | | 18,254 | |
Noncontrolling interest in Predecsssor | | (510 | ) | — | | (510 | ) |
Total Equity | | 142,876 | | — | | 1,142,876 | |
Total Liabilities and Equity | | $ | 191,961 | | $ | — | | $ | 191,961 | |
See Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet.
Notes to Unaudited Pro Forma Condensed Consolidated Balance Sheet
The Unaudited Pro Forma Condensed Consolidated Balance Sheet of Physicians Realty Trust (the “Company”) as of June 30, 2013 reflects the acquisition of the property known as 6800 Preston Road (“6800 Preston Road”) as if the purchase had occurred on June 30, 2013. The pro forma balance sheet of the Company prior to the acquisition of 6800 Preston Road has been derived from the unaudited pro forma consolidated balance sheet included in the Company’s Quarterly Report on Form 10-Q as filed on August 30, 2013. This pro forma balance sheet reflects completion of the Company’s initial public offering and formation transactions.
Information regarding the Company’s historical operations, organizational structure, initial public offering and formation transactions is provided in more detail in the Company’s final prospectus dated July 18, 2013 filed pursuant to Rule 424 (b) under the Securities Act of 1933.
Notes and Management Assumptions
1. The acquisition of 6800 Preston Road was accounted for using preliminary estimates of the fair value of the tangible and intangible assets acquired and liabilities assumed in connection with the acquisition and are therefore subject to change. The fair value of the real estate acquired was determined on an “as if vacant” basis and the cost of the property was allocated between land, income producing property and in-place leases.
2. Represents adjustment to reflect cash used to acquire 6800 Preston Road.
Pro Forma Condensed Consolidated Statement of Operations
Six Months Ended June 30, 2013
(Unaudited)
(In thousands, except share and per share data)
| | Pro Forma
Physicians
Realty Trust
Prior to
Acquisition | | Acquisition
of 6800
Preston
Road | | Pro Forma
Reflecting
Acquisition | |
Revenues: | | | | | | | |
Rental revenues | | $ | 5,032 | | $ | 817 | (1) | $ | 5,849 | |
Expenses recoveries | | 1,601 | | 156 | (2) | 1,757 | |
Other revenues | | 5 | | — | | 5 | |
Total Revenues | | 6,638 | | 973 | | 7,611 | |
Expenses: | | | | | | | |
General and administrative | | 1,421 | | — | | 1,421 | |
Operations expenses | | 2,524 | | 156 | (2) | 2,680 | |
Depreciation and amortization | | 2,014 | | 403 | (3) | 2,417 | |
Total expenses | | 5,959 | | 559 | | 6,518 | |
| | | | | | | |
Operating income | | 679 | | 414 | | 1,093 | |
Interest expense | | 1,251 | | — | | 1,251 | |
Change in fair value of derivatives, net | | (190 | ) | — | | (190 | ) |
Net loss | | (382 | ) | 414 | | 32 | |
Less: Net loss attributable to noncontrolling interests | | (132 | ) | (77 | ) | (209 | ) |
Net loss | | $ | (514 | ) | $ | 337 | | $ | (177 | ) |
| | | | | | | |
Net loss per share | | | | | | | |
Basic | | $ | (0.04 | ) | | | $ | (0.02 | ) |
Diluted | | $ | (0.04 | ) | | | $ | (0.01 | ) |
| | | | | | | |
Weighted average common shares: | | | | | | | |
Basic | | 11,753,597 | | | | 11,753,597 | |
Diluted | | 14,747,597 | | | | 14,747,597 | |
See Notes to Unaudited Pro Forma Condensed Consolidated Statement of Operations.
Pro Forma Condensed Consolidated Statement of Operations
For the Year Ended December 31, 2012
(Unaudited)
(In thousands, except share and per share data)
| | Pro Forma
Physicians
Realty Trust
Prior to
Acquisition | | Acquisition
of 6800
Preston
Road | | Pro Forma
Reflecting
Acquisition | |
Revenues: | | | | | | | |
Rental revenues | | $ | 9,821 | | $ | 1,093 | (1) | $ | 10,914 | |
Expenses recoveries | | 3,111 | | 302 | (2) | 3,413 | |
Other revenues | | 15 | | — | | 15 | |
Total revenues | | 12,947 | | 1,395 | | 14,342 | |
Expenses: | | | | | | | |
General and administrative | | 2,760 | | — | | 2,760 | |
Operations expenses | | 4,758 | | 302 | (2) | 5,060 | |
Depreciation and amortization | | 4,051 | | 806 | (3) | 4,857 | |
Impairment losses | | 936 | | — | | 936 | |
Total expenses | | 12,505 | | 1,108 | | 13,613 | |
| | | | | | | |
Operating income | | 442 | | 287 | | 729 | |
Interest expense | | 2,684 | | — | | 2,684 | |
Change in fair value of derivatives, net | | (122 | ) | — | | (122 | ) |
Net loss | | (2,120 | ) | 287 | | (1,833 | ) |
Less: Net loss attributable to noncontrolling interests | | (169 | ) | (53 | ) | (222 | ) |
Net loss attributable to shareholders | | $ | (2,289 | ) | $ | 234 | | $ | (2,055 | ) |
Net loss per share: | | | | | | | |
Basic | | $ | (0.22 | ) | | | $ | (0.20 | ) |
Diluted | | $ | (0.17 | ) | | | $ | (.0.15 | ) |
| | | | | | | |
Weighted average common shares: | | | | | | | |
Basic | | 10,434,782 | | | | 10,434,782 | |
Diluted | | 13,428,782 | | | | 13,428,792 | |
See Notes to Unaudited Pro Forma Condensed Consolidated Statement of Operations.
Basis of Presentation
The unaudited Pro Forma Consolidated Statements of Operations of Physicians Realty Trust (“the Company”) for the six months ended June 30, 2013 and the year ended December 31, 2012, reflect the acquisition of the property known as 6800 Preston Road at Plano, Texas (“6800 Preston Road”) as if the purchase had occurred on January 1, 2012 for the year ended December 31, 2012 and on January 1, 2013 for the six months ended June 30, 2013. The pro forma statement of operations of the Company, prior to the acquisition of 6800 Preston Road, for the six months ended June 30, 2013 has been derived from the unaudited pro forma consolidated income statement included in the Company’s Quarterly Report on Form 10-Q as filed on August 30, 2013. The pro forma statement of operations of the Company, prior to the acquisition of 6800 Preston Road, for the year ended December 31, 2012 has been derived from the unaudited pro forma consolidated income statement included in the Company’s Form S-11 Registration Statement dated July 18, 2013. These pro forma statements of operations reflect completion of the Company’s initial public offering and its formation transactions.
Information regarding the Company’s historical operations, organizational structure, initial public offering and formation transactions is provided in more detail in the Company’s final prospectus, dated July 18, 2013, filed pursuant to Rule 424(b) under the Securities Act of 1933.
Notes and Management Assumptions
1. Reflects the effect of straight line rental revenue of the acquired property.
2. Reflects operating expenses incurred by lessor and reimbursed by tenant.
3. Reflects depreciation expense over a 25 year period based on the fair value allocated to the income producing property and amortization of the intangible asset relating to the acquired in-place lease over the remaining life of the lease.
