Exhibit 99.2
First Quarter Fiscal 2012
Supplemental Operating and Financial Data
for the Quarter Ended July 31, 2011
| | | | | |
CONTACT: Lindsey Anderson Director of Investor Relations Direct Dial: 701-837-4738 E-Mail: landerson@iret.com | | | | 1400 31st Avenue SW, Suite 60 Minot, ND 58701 Tel: 701.837.4738 Fax: 701.838.7785 www.iret.com |
Supplemental Financial and Operating Data
July 31, 2011
| | Page |
| | |
| Company Background and Highlights | 2 |
| | |
| Investment Cost by Segment | 5 |
| | |
| Key Financial Data | |
| Condensed Consolidated Balance Sheets | 6 |
| Condensed Consolidated Statements of Operations | 7 |
| Funds From Operations | 8 |
| Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) | 9 |
| | |
| Capital Analysis | |
| Long-Term Mortgage Debt Analysis | 10 |
| Long-Term Mortgage Debt Detail | 11-12 |
| Capital Analysis | 13 |
| | |
| Portfolio Analysis | |
| Stabilized Properties Net Operating Income Summary | 14 |
| Net Operating Income Detail | 15-16 |
| Stabilized Properties and Overall Physical Occupancy Levels by Segment | 17 |
| | |
| Tenant Analysis | |
| Commercial Leasing Summary | 18-19 |
| Multi-Family Residential Summary | 20 |
| 10 Largest Commercial Tenants - Based on Annualized Base Rent | 21 |
| Lease Expirations as of July 31, 2011 | 22 |
| | |
| Growth and Strategy | |
| Fiscal 2012 Acquisition Summary | 23 |
| Fiscal 2012 Development Summary | 24 |
| | |
| Definitions | 25 |
Company Background and Highlights
First Quarter Fiscal 2012
Investors Real Estate Trust is a self-administered, equity real estate investment trust (REIT) investing in a portfolio of income-producing properties located primarily in the upper Midwest. IRET’s portfolio is diversified among multi-family residential, commercial office, commercial medical (including senior housing), commercial industrial and commercial retail segments.
During the first quarter of fiscal year 2012, the Company substantially completed construction of a six-screen movie theater at its existing Buffalo Mall property in Jamestown, North Dakota, for a total cost of $2.2 million. The Company had no acquisitions or dispositions in the first quarter of fiscal year 2012. During the quarter, the Company signed purchase agreements for the acquisition of several multi-family residential properties (two multi-family residential projects in Billings, Montana with a total of 36 units; two multi-family residential properties in Sioux Falls, South Dakota, with 50 units and 24 units, respectively, and a 36-unit multi-family residential property in Isanti, Minnesota); an approximately 2,900 square foot medical office property in Edina, Minnesota; and a parcel of vacant land located in Minot, North Dakota. All of these pending acquisitions are subject to various closing conditions and contingencies, and no assurances can be given that any of these acquisitions will be completed. Additionally, during the quarter the Company began construction on an approximately 159-unit apartment project in Rochester, Minnesota, located adjacent to the Company’s existing Quarry Ridge Apartment Homes.
During the first quarter of fiscal year 2012 we continued to experience a challenging market environment, in our commercial office segment in particular. Physical occupancy as of July 31, 2011 compared to July 31, 2010 increased in all of our reportable segments except for commercial office, on an all-property basis. On a stabilized basis, physical occupancy increased in three of our segments, decreasing in commercial office and commercial medical, from the year-earlier period. Our overall level of tenant concessions increased in the three month period ended July 31, 2011, compared to the three months ended July 31, 2010. We believe the decreased occupancy levels in our commercial office segment reflect the economic conditions in our markets, as recovery from the national economic recession has been slow and we continue to experience a challenging market environment. Our multi-family residential properties, however, continued to improve in occupancy and real estate revenue compared to the year-earlier period.
As we have previously reported, Minot, North Dakota, where our corporate headquarters are located, experienced significant flooding in June 2011, resulting in extensive damage to our Arrowhead Shopping Center and Chateau Apartments. Costs related to clean-up and redevelopment are insured to a limit that the Company believes will allow for full restoration of both properties, with loss of rents covered by business interruption insurance. The Company plans to restore the assets that were damaged by the flooding and expects that the costs of such restoration and rebuilding will be recoverable from insurance proceeds, subject to a $200,000 deductible.
In the first quarter of fiscal year 2012 IRET paid its 161st consecutive quarterly distribution per common share/unit at equal or increasing rates. The $0.1715 per share/unit distribution was paid on July 1, 2011. Subsequent to the end of the first quarter of fiscal year 2012, the Company declared a quarterly distribution of $0.1300 per share and unit payable on October 3, 2011 to shareholders of record on September 12, 2011. The Board of Trustees also declared a quarterly distribution of $0.5156 per share on the Company’s Series A preferred shares, payable September 30, 2011 to preferred shareholders of record on September 15, 2011.
During the first quarter of fiscal year 2012, the Company announced that its Board of Trustees had approved a plan recommended by Company management to reduce the Company’s quarterly distribution to $0.1300 from its former level of $0.1715 per common share and limited partnership unit, effective with the quarterly distribution planned for October 3, 2011. The Company stated at that time that the Board intended to maintain this level of cash distribution for at least the next four quarters (i.e. through the first quarter of fiscal year 2013) and anticipated growing the distribution over time in line with FFO growth. All future distributions remain subject to the discretion of the Company’s Board of Trustees.
As of July 31, 2011, IRET owns a diversified portfolio of 254 properties consisting of 78 multi-family residential properties, 68 commercial office properties, 56 commercial medical properties (including senior housing), 19 commercial industrial properties and 33 commercial retail properties. IRET’s shares are publicly traded on the NASDAQ Global Select Market (NASDAQ: IRET).
Company Snapshot
(as of July 31, 2011)
| Company Headquarters | Minot, North Dakota | |
| Fiscal Year-End | April 30 | |
| Reportable Segments | Multi-Family Residential, Commercial Office, Commercial Medical, Commercial Industrial, Commercial Retail | |
| Total Properties | 254 | | |
| Total Square Feet | | | |
| (commercial properties) | 12.2 million | |
| Total Units | | | |
| (multi-family residential properties) | 8,664 | | |
| Common Shares Outstanding (thousands) | 81,259 | | |
| Limited Partnership Units Outstanding (thousands) | 19,958 | | |
| Common Share Distribution - Quarter/Annualized | $0.1715/$0.686 | | |
| Dividend Yield | 8.4% | | |
| Total Capitalization (see p. 13 for detail) | $1.9 billion | |
Investor Information
Board of Trustees
| Jeffrey L. Miller | Trustee and Chairman |
| Stephen L. Stenehjem | Trustee and Vice Chairman, Chair of Compensation Committee |
| John D. Stewart | Trustee, Chair of Audit Committee |
| Patrick G. Jones | Trustee |
| C.W. “Chip” Morgan | Trustee |
| John T. Reed | Trustee, Chair of Nominating and Governance Committee |
| Edward T. Schafer | Trustee |
| W. David Scott | Trustee |
| Jeffrey K. Woodbury | Trustee |
| Thomas A. Wentz, Jr. | Trustee, Senior Vice President and Chief Operating Officer |
| Timothy P. Mihalick | Trustee, President and Chief Executive Officer |
Management
| Timothy P. Mihalick | President and Chief Executive Officer; Trustee |
| Thomas A. Wentz, Jr | Senior Vice President and Chief Operating Officer; Trustee |
| Diane K. Bryantt | Senior Vice President and Chief Financial Officer |
| Michael A. Bosh | Senior Vice President, General Counsel and Assistant Secretary |
| Charles A. Greenberg | Senior Vice President, Commercial Asset Management |
| Ted E. Holmes | Senior Vice President, Finance |
| Andrew Martin | Senior Vice President, Residential Property Management |
| Thomas A. Wentz, Sr. | Senior Vice President and Chief Investment Officer |
Corporate Headquarters:
1400 31st Avenue SW, Suite 60
Minot, North Dakota 58701
Trading Symbol: IRET
Stock Exchange Listing: NASDAQ
Investor Relations:
Lindsey Anderson
landerson@iret.com
Common Share Data (NASDAQ: IRET)
| | | 1st Quarter Fiscal Year 2012 | | | 4th Quarter Fiscal Year 2011 | | | 3rd Quarter Fiscal Year 2011 | | | 2nd Quarter Fiscal Year 2011 | | | 1st Quarter Fiscal Year 2011 | |
| High Closing Price | | $ | 9.69 | | | $ | 9.54 | | | $ | 9.26 | | | $ | 8.90 | | | $ | 9.20 | |
| Low Closing Price | | $ | 8.07 | | | $ | 8.92 | | | $ | 8.74 | | | $ | 7.97 | | | $ | 8.25 | |
| Average Closing Price | | $ | 8.87 | | | $ | 9.24 | | | $ | 8.99 | | | $ | 8.43 | | | $ | 8.71 | |
| Closing Price at end of quarter | | $ | 8.13 | | | $ | 9.41 | | | $ | 8.94 | | | $ | 8.80 | | | $ | 8.47 | |
| Common Share Distributions—annualized | | $ | 0.686 | | | $ | 0.686 | | | $ | 0.686 | | | $ | 0.686 | | | $ | 0.686 | |
| Closing Dividend Yield - annualized | | | 8.4 | % | | | 7.3 | % | | | 7.7 | % | | | 7.8 | % | | | 8.1 | % |
| Closing common shares outstanding (thousands) | | | 81,259 | | | | 80,523 | | | | 79,846 | | | | 79,092 | | | | 78,158 | |
| Closing limited partnership units outstanding (thousands) | | | 19,958 | | | | 20,068 | | | | 20,047 | | | | 19,994 | | | | 20,273 | |
| Closing market value of outstanding common shares, plus imputed closing market value of outstanding limited partnership units (thousands) | | $ | 822,894 | | | $ | 946,561 | | | $ | 893,043 | | | $ | 871,957 | | | $ | 833,711 | |
Certain statements in these supplemental disclosures are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from projected results. Such risks, uncertainties and other factors include, but are not limited to: intentions and expectations regarding future distributions on our common shares and units, fluctuations in interest rates, the effect of government regulation, the availability of capital, changes in general and local economic and real estate market conditions, competition, our ability to attract and retain skilled personnel, and those risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission, including our 2011Form 10-K. We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.
First Quarter Fiscal 2012 Acquisitions
| |
Jamestown Buffalo Mall 2400 Highway 281 South, Jamestown, ND 58401 (interior Bison 6 Cinema) | Jamestown Buffalo Mall 2400 Highway 281 South, Jamestown, ND 58401 (exterior Bison 6 Cinema) |
| |
| | |
| | |
Investment Cost by Segment – First Quarter Fiscal 2012
With investments in the multi-family residential and commercial office, commercial medical, commercial industrial and commercial retail segments, IRET’s diversified portfolio helps to provide stability during market fluctuations in returns from specific property types.
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
(in thousands)
| | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
| ASSETS | | | | | | | | | | | | | | | |
| Real estate investments | | | | | | | | | | | | | | | |
| Property owned | | $ | 1,777,485 | | | $ | 1,770,798 | | | $ | 1,763,585 | | | $ | 1,773,924 | | | $ | 1,813,427 | |
| Less accumulated depreciation | | | (339,293 | ) | | | (328,952 | ) | | | (319,235 | ) | | | (322,379 | ) | | | (320,994 | ) |
| | | | 1,438,192 | | | | 1,441,846 | | | | 1,444,350 | | | | 1,451,545 | | | | 1,492,433 | |
| Development in progress | | | 12,697 | | | | 9,693 | | | | 4,231 | | | | 2,755 | | | | 174 | |
| Unimproved land | | | 6,550 | | | | 6,550 | | | | 7,470 | | | | 7,876 | | | | 6,020 | |
| Mortgage loans receivable, net of allowance | | | 156 | | | | 156 | | | | 157 | | | | 157 | | | | 158 | |
| Total real estate investments | | | 1,457,595 | | | | 1,458,245 | | | | 1,456,208 | | | | 1,462,333 | | | | 1,498,785 | |
| Other assets | | | | | | | | | | | | | | | | | | | | |
| Cash and cash equivalents | | | 37,307 | | | | 41,191 | | | | 30,907 | | | | 43,701 | | | | 56,077 | |
| Marketable securities – available-for-sale | | | 627 | | | | 625 | | | | 325 | | | | 420 | | | | 420 | |
| Receivable arising from straight-lining of rents, net of allowance | | | 19,331 | | | | 18,933 | | | | 18,656 | | | | 18,125 | | | | 17,751 | |
| Accounts receivable, net of allowance | | | 7,935 | | | | 5,646 | | | | 8,864 | | | | 5,179 | | | | 5,911 | |
| Real estate deposits | | | 458 | | | | 329 | | | | 254 | | | | 2,089 | | | | 302 | |
| Prepaid and other assets | | | 1,997 | | | | 2,351 | | | | 2,852 | | | | 3,375 | | | | 3,032 | |
| Intangible assets, net of accumulated amortization | | | 48,108 | | | | 49,832 | | | | 51,543 | | | | 48,140 | | | | 50,050 | |
| Tax, insurance, and other escrow | | | 15,198 | | | | 15,268 | | | | 18,467 | | | | 10,504 | | | | 10,391 | |
| Property and equipment, net of accumulated depreciation | | | 1,687 | | | | 1,704 | | | | 1,332 | | | | 1,370 | | | | 1,371 | |
| Goodwill | | | 1,127 | | | | 1,127 | | | | 1,127 | | | | 1,260 | | | | 1,388 | |
| Deferred charges and leasing costs, net of accumulated amortization | | | 20,304 | | | | 20,112 | | | | 19,737 | | | | 18,606 | | | | 18,449 | |
| TOTAL ASSETS | | $ | 1,611,674 | | | $ | 1,615,363 | | | $ | 1,610,272 | | | $ | 1,615,102 | | | $ | 1,663,927 | |
| | | | | | | | | | | | | | | | | | | | | |
| LIABILITIES AND EQUITY | | | | | | | | | | | | | | | | | | | | |
| LIABILITIES | | | | | | | | | | | | | | | | | | | | |
| Accounts payable and accrued expenses | | $ | 34,547 | | | $ | 37,879 | | | $ | 35,633 | | | $ | 26,616 | | | $ | 33,340 | |
| Revolving lines of credit | | | 34,000 | | | | 30,000 | | | | 10,000 | | | | 29,100 | | | | 6,528 | |
| Mortgages payable | | | 1,002,962 | | | | 993,803 | | | | 998,929 | | | | 1,004,532 | | | | 1,063,414 | |
| Other | | | 6,369 | | | | 8,404 | | | | 8,423 | | | | 1,227 | | | | 1,272 | |
| TOTAL LIABILITIES | | | 1,077,878 | | | | 1,070,086 | | | | 1,052,985 | | | | 1,061,475 | | | | 1,104,554 | |
| | | | | | | | | | | | | | | | | | | | | |
| REDEEMABLE NONCONTROLLING INTERESTS – CONSOLIDATED REAL ESTATE ENTITIES | | | 1,263 | | | | 987 | | | | 1,237 | | | | 1,357 | | | | 1,427 | |
| EQUITY | | | | | | | | | | | | | | | | | | | | |
| Investors Real Estate Trust shareholders’ equity | | | | | | | | | | | | | | | | | | | | |
| Preferred Shares of Beneficial Interest | | | 27,317 | | | | 27,317 | | | | 27,317 | | | | 27,317 | | | | 27,317 | |
| Common Shares of Beneficial Interest | | | 627,722 | | | | 621,936 | | | | 616,701 | | | | 610,580 | | | | 603,344 | |
| Accumulated distributions in excess of net income | | | (250,585 | ) | | | (237,563 | ) | | | (223,684 | ) | | | (221,304 | ) | | | (213,055 | ) |
| Total Investors Real Estate Trust shareholders’ equity | | | 404,454 | | | | 411,690 | | | | 420,334 | | | | 416,593 | | | | 417,606 | |
| Noncontrolling interests – Operating Partnership | | | 119,382 | | | | 123,627 | | | | 126,335 | | | | 126,113 | | | | 130,050 | |
| Noncontrolling interests – consolidated real estate entities | | | 8,697 | | | | 8,973 | | | | 9,381 | | | | 9,564 | | | | 10,290 | |
| Total equity | | | 532,533 | | | | 544,290 | | | | 556,050 | | | | 552,270 | | | | 557,946 | |
| TOTAL LIABILITIES AND EQUITY | | $ | 1,611,674 | | | $ | 1,615,363 | | | $ | 1,610,272 | | | $ | 1,615,102 | | | $ | 1,663,927 | |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(in thousands, except per share data)
| | | Three Months Ended | |
| OPERATING RESULTS | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
| Real estate revenue | | $ | 59,628 | | | $ | 59,124 | | | $ | 60,203 | | | $ | 58,904 | | | $ | 59,176 | |
| Real estate expenses | | | 24,887 | | | | 26,269 | | | | 27,037 | | | | 24,304 | | | | 24,313 | |
| Net operating income | | | 34,741 | | | | 32,855 | | | | 33,166 | | | | 34,600 | | | | 34,863 | |
| Depreciation/amortization | | | (14,900 | ) | | | (14,947 | ) | | | (14,591 | ) | | | (14,424 | ) | | | (14,566 | ) |
| Administrative expenses, advisory and trustee services | | | (2,181 | ) | | | (1,685 | ) | | | (1,850 | ) | | | (1,718 | ) | | | (1,969 | ) |
| Other expenses | | | (315 | ) | | | (417 | ) | | | (441 | ) | | | (563 | ) | | | (353 | ) |
| Interest | | | (15,925 | ) | | | (15,626 | ) | | | (15,888 | ) | | | (16,436 | ) | | | (16,071 | ) |
| Interest and other income | | | 153 | | | | 130 | | | | 107 | | | | 167 | | | | 137 | |
| Income tax benefit (expense) | | | 0 | | | | 0 | | | | 0 | | | | 19 | | | | (19 | ) |
| Income from continuing operations | | | 1,573 | | | | 310 | | | | 503 | | | | 1,645 | | | | 2,022 | |
| Income (loss) from discontinued operations | | | 0 | | | | 0 | | | | 14,085 | | | | 5,476 | | | | 310 | |
| Net income | | $ | 1,573 | | | $ | 310 | | | $ | 14,588 | | | $ | 7,121 | | | $ | 2,332 | |
| | | | | | | | | | | | | | | | | | | | | |
| Net (income) loss attributable to noncontrolling interest – Operating Partnership | | | (178 | ) | | | 36 | | | | (2,793 | ) | | | (1,322 | ) | | | (370 | ) |
| Net loss (income) attributable to noncontrolling interests – consolidated real estate entities | | | 26 | | | | 98 | | | | 38 | | | | 20 | | | | 24 | |
| Net income attributable to Investors Real Estate Trust | | | 1,421 | | | | 444 | | | | 11,833 | | | | 5,819 | | | | 1,986 | |
| Dividends to preferred shareholders | | | (593 | ) | | | (593 | ) | | | (593 | ) | | | (593 | ) | | | (593 | ) |
| NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | | $ | 828 | | | $ | (149 | ) | | $ | 11,240 | | | $ | 5,226 | | | $ | 1,393 | |
| | | | | | | | | | | | | | | | | | | | | |
| Per Share Data | | | | | | | | | | | | | | | | | | | | |
| Earnings (loss) per common share from continuing operations – Investors Real Estate Trust – basic & diluted | | $ | .01 | | | $ | (.01 | ) | | $ | .00 | | | $ | .01 | | | $ | .02 | |
| Earnings (loss) per common share from discontinued operations – Investors Real Estate Trust – basic & diluted | | | .00 | | | | .00 | | | | .14 | | | | .06 | | | | .00 | |
| Net income (loss) per common share – basic & diluted | | $ | .01 | | | $ | (.01 | ) | | $ | .14 | | | $ | .07 | | | $ | .02 | |
| | | | | | | | | | | | | | | | | | | | | |
| Percentage of Revenues | | | | | | | | | | | | | | | | | | | | |
| Real estate expenses | | | 41.7 | % | | | 44.4 | % | | | 44.9 | % | | | 41.3 | % | | | 41.1 | % |
| Depreciation/amortization | | | 25.0 | % | | | 25.3 | % | | | 24.2 | % | | | 24.5 | % | | | 24.6 | % |
| General and administrative | | | 3.7 | % | | | 2.8 | % | | | 3.1 | % | | | 2.9 | % | | | 3.3 | % |
| Interest | | | 26.7 | % | | | 26.4 | % | | | 26.4 | % | | | 27.9 | % | | | 27.2 | % |
| Net income | | | 2.6 | % | | | 0.5 | % | | | 24.2 | % | | | 12.1 | % | | | 3.9 | % |
| | | | | | | | �� | | | | | | | | | | | | | |
| Ratios | | | | | | | | | | | | | | | | | | | | |
EBITDA(1)/Interest expense | | | 2.03 | x | | | 1.98 | x | | | 1.97 | x | | | 1.96 | x | | | 2.04 | x |
| EBITDA/Interest expense plus preferred distributions | | | 1.96 | x | | | 1.91 | x | | | 1.90 | x | | | 1.89 | x | | | 1.97 | x |
| (1) | See Definitions on page 25. EBITDA is a non-GAAP measure; see page 9 for a reconciliation of EBITDA to net income (loss). |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
FUNDS FROM OPERATIONS (unaudited)
(in thousands, except per share and unit data)
| | | Three Months Ended | |
| | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
Funds From Operations(1) | | | | | | | | | | | | | | | |
| Net income attributable to Investors Real Estate Trust | | $ | 1,421 | | | $ | 444 | | | $ | 11,833 | | | $ | 5,819 | | | $ | 1,986 | |
| Less dividends to preferred shareholders | | | (593 | ) | | | (593 | ) | | | (593 | ) | | | (593 | ) | | | (593 | ) |
| Net income (loss) available to common shareholders | | | 828 | | | | (149 | ) | | | 11,240 | | | | 5,226 | | | | 1,393 | |
| Adjustments: | | | | | | | | | | | | | | | | | | | | |
| Noncontrolling interests – Operating Partnership | | | 178 | | | | (36 | ) | | | 2,793 | | | | 1,322 | | | | 370 | |
| Depreciation and amortization | | | 14,823 | | | | 14,877 | | | | 14,577 | | | | 14,888 | | | | 15,060 | |
| Gain on depreciable property sales | | | 0 | | | | 0 | | | | (13,961 | ) | | | (5,404 | ) | | | 0 | |
| Funds from operations applicable to common shares and Units | | $ | 15,829 | | | $ | 14,692 | | | $ | 14,649 | | | $ | 16,032 | | | $ | 16,823 | |
| | | | | | | | | | | | | | | | | | | | | |
| FFO per share and unit - basic and diluted | | $ | 0.16 | | | $ | 0.15 | | | $ | 0.14 | | | $ | 0.17 | | | $ | 0.17 | |
| Weighted average shares and units | | | 100,844 | | | | 100,239 | | | | 99,355 | | | | 98,737 | | | | 96,777 | |
| (1) | See Definitions on page 25. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (EBITDA) (unaudited)
(in thousands)
| | | Three Months Ended | |
| | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
EBITDA(1) | | | | | | | | | | | | | | | |
| Net income attributable to Investors Real Estate Trust | | $ | 1,421 | | | $ | 444 | | | $ | 11,833 | | | $ | 5,819 | | | $ | 1,986 | |
| Adjustments: | | | | | | | | | | | | | | | | | | | | |
| Noncontrolling interests – Operating Partnership | | | 178 | | | | (36 | ) | | | 2,793 | | | | 1,322 | | | | 370 | |
| Income before noncontrolling interests – Operating Partnership | | | 1,599 | | | | 408 | | | | 14,626 | | | | 7,141 | | | | 2,356 | |
| Add: | | | | | | | | | | | | | | | | | | | | |
| Interest | | | 15,925 | | | | 15,626 | | | | 15,719 | | | | 17,346 | | | | 16,762 | |
| Depreciation/amortization related to real estate investments | | | 14,166 | | | | 14,246 | | | | 13,943 | | | | 14,320 | | | | 14,482 | |
| Amortization related to non-real estate investments | | | 734 | | | | 701 | | | | 689 | | | | 639 | | | | 654 | |
Amortization related to real estate revenues(2) | | | 51 | | | | 56 | | | | 44 | | | | 28 | | | | 25 | |
| Less: | | | | | | | | | | | | | | | | | | | | |
| Interest income | | | (53 | ) | | | (65 | ) | | | (75 | ) | | | (66 | ) | | | (58 | ) |
| Gain on sale of real estate, land and other investments | | | 0 | | | | 0 | | | | (13,961 | ) | | | (5,404 | ) | | | 0 | |
| EBITDA | | $ | 32,422 | | | $ | 30,972 | | | $ | 30,985 | | | $ | 34,004 | | | $ | 34,221 | |
| (1) | See Definitions on page 25. |
| (2) | Included in real estate revenue in the Statement of Operations. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
LONG-TERM MORTGAGE DEBT ANALYSIS
(in thousands)
Debt Maturity Schedule
Annual Expirations
Total Mortgage Debt
| | | Future Maturities of Debt | |
| Fiscal Year | | Fixed Debt | | | Variable Debt | | | Total Debt | | | Weighted Average(1) | | | % of Total Debt | |
| 2012 | | $ | 25,667 | | | $ | 0 | | | $ | 25,667 | | | | 6.33 | % | | | 2.6 | % |
| 2013 | | | 21,996 | | | | 0 | | | | 21,996 | | | | 5.76 | % | | | 2.2 | % |
| 2014 | | | 44,310 | | | | 799 | | | | 45,109 | | | | 6.14 | % | | | 4.5 | % |
| 2015 | | | 75,754 | | | | 5,250 | | | | 81,004 | | | | 5.66 | % | | | 8.1 | % |
| 2016 | | | 67,064 | | | | 82 | | | | 67,146 | | | | 5.98 | % | | | 6.7 | % |
| 2017 | | | 187,904 | | | | 0 | | | | 187,904 | | | | 6.16 | % | | | 18.7 | % |
| 2018 | | | 86,472 | | | | 0 | | | | 86,472 | | | | 5.80 | % | | | 8.6 | % |
| 2019 | | | 72,270 | | | | 575 | | | | 72,845 | | | | 6.37 | % | | | 7.3 | % |
| 2020 | | | 118,699 | | | | 0 | | | | 118,699 | | | | 5.85 | % | | | 11.8 | % |
| 2021 | | | 120,329 | | | | 0 | | | | 120,329 | | | | 5.47 | % | | | 12.0 | % |
| Thereafter | | | 175,791 | | | | 0 | | | | 175,791 | | | | 5.80 | % | | | 17.5 | % |
| Total maturities | | $ | 996,256 | | | $ | 6,706 | | | $ | 1,002,962 | | | | 5.90 | % | | | 100.0 | % |
| (1) | Weighted average interest rate of debt that matures in fiscal year. |
| | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
| Balances Outstanding | | | | | | | | | | | | | | | |
| Mortgage | | | | | | | | | | | | | | | |
| Fixed rate | | $ | 996,256 | | | $ | 992,276 | | | $ | 997,332 | | | $ | 1,002,867 | | | $ | 1,034,982 | |
| Variable rate | | | 6,706 | | | | 1,527 | | | | 1,597 | | | | 1,665 | | | | 28,432 | |
| Mortgage total | | | 1,002,962 | | | | 993,803 | | | | 998,929 | | | | 1,004,532 | | | | 1,063,414 | |
| | | | | | | | | | | | | | | | | | | | | |
| Weighted Average Interest Rates | | | | | | | | | | | | | | | | | | | | |
| Secured | | | 5.90 | % | | | 5.92 | % | | | 6.05 | % | | | 6.14 | % | | | 6.13 | % |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
LONG-TERM MORTGAGE DEBT* DETAIL AS OF JULY 31, 2011
(in thousands)
| Property | Maturity Date | | Fiscal 2012 | | | Fiscal 2013 | | | Fiscal 2014 | | | Fiscal 2015 | | | Thereafter | | | Total(1) | |
| | | | | | | | | | | | | | | | | | | | |
| Multi-Family Residential | | | | | | | | | | | | | | | | | | | |
Oakmont Estates - Sioux Falls, SD (2) | 9/1/2011 | | $ | 3,586 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 3,586 | |
| Canyon Lake - Rapid City, SD | 10/1/2011 | | | 2,579 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 2,579 | |
| Meadows III - Jamestown, ND | 11/1/2011 | | | 935 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 935 | |
| Crown - Rochester, MN | 1/1/2012 | | | 2,508 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 2,508 | |
| Monticello Village - Monticello, MN | 3/1/2013 | | | 0 | | | | 3,007 | | | | 0 | | | | 0 | | | | 0 | | | | 3,007 | |
| Quarry Ridge - Rochester, MN | 10/1/2013 | | | 0 | | | | 0 | | | | 12,072 | | | | 0 | | | | 0 | | | | 12,072 | |
| East Park - Sioux Falls, SD | 12/1/2013 | | | 0 | | | | 0 | | | | 1,521 | | | | 0 | | | | 0 | | | | 1,521 | |
| Sycamore Village - Sioux Falls, SD | 12/1/2013 | | | 0 | | | | 0 | | | | 856 | | | | 0 | | | | 0 | | | | 856 | |
| Candlelight - Fargo, ND | 3/1/2014 | | | 0 | | | | 0 | | | | 1,305 | | | | 0 | | | | 0 | | | | 1,305 | |
| Summary of Debt due after Fiscal 2015 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 252,916 | | | | 252,916 | |
| Sub-Total Multi-Family Residential | | | $ | 9,608 | | | $ | 3,007 | | | $ | 15,754 | | | $ | 0 | | | $ | 252,916 | | | $ | 281,285 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial Office | | | | | | | | | | | | | | | | | | | | | | | | | |
Wells Fargo Center - St Cloud, MN (3) | 10/1/2011 | | $ | 6,261 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 6,261 | |
| Wirth Corporate Center - Golden Valley, MN | 2/1/2012 | | | 3,713 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 3,713 | |
| Great Plains - Fargo, ND | 10/1/2013 | | | 0 | | | | 0 | | | | 2,849 | | | | 0 | | | | 0 | | | | 2,849 | |
| Whitewater Plaza - Minnetonka, MN | 3/1/2014 | | | 0 | | | | 0 | | | | 2,600 | | | | 0 | | | | 0 | | | | 2,600 | |
| Whitewater Plaza - Minnetonka, MN | 3/1/2014 | | | 0 | | | | 0 | | | | 1,348 | | | | 0 | | | | 0 | | | | 1,348 | |
| Viromed - Eden Prairie, MN | 4/1/2014 | | | 0 | | | | 0 | | | | 839 | | | | 0 | | | | 0 | | | | 839 | |
| TCA Building - Eagan, MN | 5/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 7,862 | | | | 0 | | | | 7,862 | |
| Brenwood - Hennepin County, MN | 7/15/2014 | | | 0 | | | | 0 | | | | 0 | | | | 5,250 | | | | 0 | | | | 5,250 | |
| Burnsville Bluffs II - Burnsville, MN | 8/8/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,783 | | | | 0 | | | | 1,783 | |
| Plymouth IV - Plymouth, MN | 8/8/2014 | | | 0 | | | | 0 | | | | 0 | | | | 3,289 | | | | 0 | | | | 3,289 | |
| Plymouth V - Plymouth, MN | 8/8/2014 | | | 0 | | | | 0 | | | | 0 | | | | 3,844 | | | | 0 | | | | 3,844 | |
| Plaza VII - Boise, ID | 9/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,094 | | | | 0 | | | | 1,094 | |
| Crosstown Centre - Eden Prairie, MN | 12/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 3,507 | | | | 0 | | | | 3,507 | |
| Crosstown Centre - Eden Prairie, MN | 12/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 10,521 | | | | 0 | | | | 10,521 | |
| Northgate I - Maple Grove, MN | 12/10/2014 | | | 0 | | | | 0 | | | | 0 | | | | 5,464 | | | | 0 | | | | 5,464 | |
| Plymouth I - Plymouth, MN | 12/10/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,225 | | | | 0 | | | | 1,225 | |
| Plymouth II - Plymouth, MN | 12/10/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,225 | | | | 0 | | | | 1,225 | |
| Plymouth III - Plymouth, MN | 12/10/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,507 | | | | 0 | | | | 1,507 | |
| Benton Business Park - Sauk Rapids, MN | 1/1/2015 | | | 0 | | | | 0 | | | | 0 | | | | 672 | | | | 0 | | | | 672 | |
| West River Business Park - Waite Park, MN | 1/1/2015 | | | 0 | | | | 0 | | | | 0 | | | | 672 | | | | 0 | | | | 672 | |
| Highlands Ranch I - Highlands Ranch, CO | 3/1/2015 | | | 0 | | | | 0 | | | | 0 | | | | 8,590 | | | | 0 | | | | 8,590 | |
| Highlands Ranch II - Highlands Ranch, CO | 3/1/2015 | | | 0 | | | | 0 | | | | 0 | | | | 8,381 | | | | 0 | | | | 8,381 | |
| Summary of Debt due after Fiscal 2015 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 266,676 | | | | 266,676 | |
| Sub-Total Commercial Office | | | $ | 9,974 | | | $ | 0 | | | $ | 7,636 | | | $ | 64,886 | | | $ | 266,676 | | | $ | 349,172 | |
| Commercial Medical | | | | | | | | | | | | | | | | | | | | | | | | | |
| Georgetown Square - Grand Chute, WI | 5/1/2012 | | $ | 0 | | | $ | 2,210 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,210 | |
| High Pointe Health Campus - Lake Elmo, MN | 12/1/2013 | | | 0 | | | | 0 | | | | 2,058 | | | | 0 | | | | 0 | | | | 2,058 | |
| Edgewood Vista - Billings, MT | 12/10/2014 | | | 0 | | | | 0 | | | | 0 | | | | 2,012 | | | | 0 | | | | 2,012 | |
| Edgewood Vista - East Grand Forks, MN | 12/10/2014 | | | 0 | | | | 0 | | | | 0 | | | | 3,065 | | | | 0 | | | | 3,065 | |
| Edgewood Vista - Sioux Falls, SD | 12/10/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,152 | | | | 0 | | | | 1,152 | |
| Summary of Debt due after Fiscal 2015 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 251,385 | | | | 251,385 | |
| Sub-Total Commercial Medical | | | $ | 0 | | | $ | 2,210 | | | $ | 2,058 | | | $ | 6,229 | | | $ | 251,385 | | | $ | 261,882 | |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
LONG-TERM MORTGAGE DEBT* DETAIL AS OF JULY 31, 2011 (continued)
(in thousands)
| Property | Maturity Date | | Fiscal 2012 | | | Fiscal 2013 | | | Fiscal 2014 | | | Fiscal 2015 | | | Thereafter | | | Total(1) | |
| | | | | | | | | | | | | | | | | | | | |
| Commercial Industrial | | | | | | | | | | | | | | | | | | | |
| Stone Container - Roseville, MN | 2/1/2012 | | $ | 3,685 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 3,685 | |
| Minnetonka 13600 County Road 62 - Minnetonka, MN | 2/27/2012 | | | 2,400 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 2,400 | |
| Dixon Avenue Industrial Park - Des Moines, IA | 1/1/2013 | | | 0 | | | | 7,230 | | | | 0 | | | | 0 | | | | 0 | | | | 7,230 | |
| Bloomington 2000 West 94th Street - Bloomington, MN | 3/1/2013 | | | 0 | | | | 3,865 | | | | 0 | | | | 0 | | | | 0 | | | | 3,865 | |
| Roseville 2929 Long Lake Road - Roseville, MN | 3/1/2013 | | | 0 | | | | 5,684 | | | | 0 | | | | 0 | | | | 0 | | | | 5,684 | |
| Bodycote Industrial Building - Eden Prairie, MN | 9/1/2013 | | | 0 | | | | 0 | | | | 1,170 | | | | 0 | | | | 0 | | | | 1,170 | |
| Cedar Lake Business Center - St. Louis Park, MN | 11/1/2013 | | | 0 | | | | 0 | | | | 2,375 | | | | 0 | | | | 0 | | | | 2,375 | |
| Woodbury 1865 Woodlane - Woodbury, MN | 11/1/2013 | | | 0 | | | | 0 | | | | 2,795 | | | | 0 | | | | 0 | | | | 2,795 | |
| Clive 2075 NW 94th St - Clive, IA | 9/30/2014 | | | 0 | | | | 0 | | | | 0 | | | | 2,241 | | | | 0 | | | | 2,241 | |
| Metal Improvement Company - New Brighton, MN | 9/30/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,542 | | | | 0 | | | | 1,542 | |
| Winsted Industrial Building | 9/30/2014 | | | 0 | | | | 0 | | | | 0 | | | | 407 | | | | 0 | | | | 407 | |
| Summary of Debt due after Fiscal 2015 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 23,817 | | | | 23,817 | |
| Sub-Total Commercial Industrial | | | $ | 6,085 | | | $ | 16,779 | | | $ | 6,340 | | | $ | 4,190 | | | $ | 23,817 | | | $ | 57,211 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial Retail | | | | | | | | | | | | | | | | | | | | | | | | | |
| Burnsville I Strip Center - Burnsville, MN | 6/30/2013 | | $ | 0 | | | $ | 0 | | | $ | 445 | | | $ | 0 | | | $ | 0 | | | $ | 445 | |
| Burnsville II Strip Center - Burnsville, MN | 6/30/2013 | | | 0 | | | | 0 | | | | 354 | | | | 0 | | | | 0 | | | | 354 | |
| St Cloud Westgate - St Cloud, MN | 10/10/2013 | | | 0 | | | | 0 | | | | 3,330 | | | | 0 | | | | 0 | | | | 3,330 | |
| Livingston Pamida - Livingston, MT | 12/19/2013 | | | 0 | | | | 0 | | | | 1,184 | | | | 0 | | | | 0 | | | | 1,184 | |
| Eagan I Retail Center - Eagan, MN | 12/22/2013 | | | 0 | | | | 0 | | | | 1,385 | | | | 0 | | | | 0 | | | | 1,385 | |
| Forest Lake Westlake Center - Forest Lake, MN | 12/22/2013 | | | 0 | | | | 0 | | | | 4,428 | | | | 0 | | | | 0 | | | | 4,428 | |
| Pine City C-Store - Pine City, MN | 4/20/2014 | | | 0 | | | | 0 | | | | 307 | | | | 0 | | | | 0 | | | | 307 | |
| Pine City Evergreen Square - Pine City, MN | 4/20/2014 | | | 0 | | | | 0 | | | | 1,888 | | | | 0 | | | | 0 | | | | 1,888 | |
| Omaha Barnes & Noble - Omaha, NE | 6/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 2,659 | | | | 0 | | | | 2,659 | |
| Jamestown Buffalo Mall - Jamestown, ND | 9/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 987 | | | | 0 | | | | 987 | |
| Fargo Express Center - Fargo, ND | 10/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,029 | | | | 0 | | | | 1,029 | |
| Lakeville Strip Center - Lakeville, MN | 10/1/2014 | | | 0 | | | | 0 | | | | 0 | | | | 1,024 | | | | 0 | | | | 1,024 | |
| Summary of Debt due after Fiscal 2015 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 34,392 | | | | 34,392 | |
| Sub-Total Commercial Retail | | | $ | 0 | | | $ | 0 | | | $ | 13,321 | | | $ | 5,699 | | | $ | 34,392 | | | $ | 53,412 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total | | | $ | 25,667 | | | $ | 21,996 | | | $ | 45,109 | | | $ | 81,004 | | | $ | 829,186 | | | $ | 1,002,962 | |
| * | Mortgage debt does not include the Company’s multi-bank line of credit and one loan financed with Recovery Zone Facility Bonds. The line of credit has a maturity date of August 11, 2013; as of July 31, 2011, the Company had borrowings of $34,000,000 outstanding under this line. The loan financed with Recovery Zone Facility Bonds matures on July 1, 2036; the principal amount of this loan is $5.2 million |
| (1) | Totals are principal balances as of July 31, 2011. |
| (2) | Commitment has been signed to refinance this maturing loan on or before its maturity date. |
| (3) | Loan refinanced on August 25, 2011. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
CAPITAL ANALYSIS
(in thousands, except per share and unit amounts)
| | | Three Months Ended | |
| | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
| Equity Capitalization | | | | | | | | | | | | | | | |
| Common shares outstanding | | | 81,259 | | | | 80,523 | | | | 79,846 | | | | 79,092 | | | | 78,158 | |
| Operating partnership (OP) units outstanding | | | 19,958 | | | | 20,068 | | | | 20,047 | | | | 19,994 | | | | 20,273 | |
| Total common shares and OP units outstanding | | | 101,217 | | | | 100,591 | | | | 99,893 | | | | 99,086 | | | | 98,431 | |
| Market price per common share (closing price at end of period) | | $ | 8.13 | | | $ | 9.41 | | | $ | 8.94 | | | $ | 8.80 | | | $ | 8.47 | |
| Equity capitalization-common shares and OP units | | $ | 822,894 | | | $ | 946,561 | | | $ | 893,043 | | | $ | 871,957 | | | $ | 833,711 | |
| Recorded book value of preferred shares | | $ | 27,317 | | | $ | 27,317 | | | $ | 27,317 | | | $ | 27,317 | | | $ | 27,317 | |
| Total equity capitalization | | $ | 850,211 | | | $ | 973,878 | | | $ | 920,360 | | | $ | 899,274 | | | $ | 861,028 | |
| | | | | | | | | | | | | | | | | | | | | |
| Debt Capitalization | | | | | | | | | | | | | | | | | | | | |
| Total mortgage debt | | $ | 1,002,962 | | | $ | 993,803 | | | $ | 998,929 | | | $ | 1,004,532 | | | $ | 1,063,414 | |
| Total capitalization | | $ | 1,853,173 | | | $ | 1,967,681 | | | $ | 1,919,289 | | | $ | 1,903,806 | | | $ | 1,924,442 | |
| | | | | | | | | | | | | | | | | | | | | |
| Total debt to total capitalization | | 0.54:1 | | | 0.51:1 | | | 0.52:1 | | | 0.53:1 | | | 0.55:1 | |
| | | Three Months Ended | |
| | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
Earnings to fixed charges(1) | | | 1.10 | x | | | 1.03 | x | | | 1.03 | x | | | 1.10 | x | | | 1.12 | x |
Earnings to combined fixed charges and preferred distributions(1) | | | 1.06 | x | | | 0.99 | x | | | 1.00 | x | | | 1.06 | x | | | 1.08 | x |
Debt service coverage ratio(1) | | | 1.41 | x | | | 1.37 | x | | | 1.37 | x | | | 1.40 | x | | | 1.44 | x |
| | | | | | | | | | | | | | | | | | | | | |
| Distribution Data | | | | | | | | | | | | | | | | | | | | |
| Common shares and units outstanding at record date | | | 100,725 | | | | 100,101 | | | | 99,213 | | | | 98,726 | | | | 96,506 | |
| Total common distribution paid | | $ | 17,275 | | | $ | 17,167 | | | $ | 17,015 | | | $ | 16,931 | | | $ | 16,551 | |
| Common distribution per share and unit | | $ | .1715 | | | $ | .1715 | | | $ | .1715 | | | $ | .1715 | | | $ | .1715 | |
Payout ratio (FFO per share and unit basis)(1) | | | 107.2 | % | | | 114.3 | % | | | 122.5 | % | | | 100.9 | % | | | 100.9 | % |
| (1) | See Definitions on page 25. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
STABILIZED PROPERTIES NET OPERATING INCOME SUMMARY
(in thousands)
| | | Stabilized Properties(1) | |
| | | Three Months Ended July 31, | |
| Segment | | 2011 | | | 2010 | | | % Change | |
| Multi-Family Residential | | $ | 9,045 | | | $ | 8,109 | | | | 11.5 | % |
| Commercial Office | | | 9,666 | | | | 10,954 | | | | (11.8 | %) |
| Commercial Medical | | | 10,600 | | | | 10,999 | | | | (3.6 | %) |
| Commercial Industrial | | | 2,361 | | | | 2,390 | | | | (1.2 | %) |
| Commercial Retail | | | 2,112 | | | | 2,377 | | | | (11.1 | %) |
| | | $ | 33,784 | | | $ | 34,829 | | | | (3.0 | %) |
| (1) | For Three Months Ended July 31, 2011, stabilized properties excluded: |
Multi-Family Residential - | North Pointe II, Bismarck, ND and Sierra Vista, Sioux Falls, SD. |
| | Total number of units, 68 Occupancy % for July 31, 2011 is 94.1%. |
Commercial Office - | 1st Avenue Building, Minot, ND and Omaha 10802 Farnum Drive, Omaha, NE. |
| | Total square footage 63,001. Occupancy % for July 31, 2011 is 98.7%. |
Commercial Medical - | Billings 2300 Grant Road, Billings, MT; Missoula 3050 Great Northern Avenue, Missoula, MT and Edgewood Vista-Minot, Minot, ND. |
| | Total square footage, 137,848. Occupancy % for July 31, 2011 is 100.0%. |
Commercial Industrial - | Fargo 1320 45th Street North, Fargo, ND. |
| | Total square footage, 42,244. Occupancy % for July 31, 2011 is 100.0%. |
Commercial Retail - | Minot 1400 31st Ave, Minot, ND. |
| | Total square footage, 48,960 Occupancy % for July 31, 2011 is 44.9%. |
| | For Three Months Ended July 31, 2010, stabilized properties excluded: |
Commercial Office - | 1st Avenue Building, Minot, ND. |
| | Total square footage, 15,446. Occupancy % for July 31, 2010 is 28.7%. |
Commercial Medical - | Billings 2300 Grant Road, Billings, MT; Missoula 3050 Great Northern Avenue, Missoula, MT and Fox River Cottages, Grand Chute, WI. |
| | Total square footage, 55,681. Occupancy % for July 31, 2010 is 52.7%. |
Commercial Industrial - | Fargo 1320 45th Street North, Fargo, ND. |
| | Total square footage, 42,244. Occupancy % for July 31, 2010 is 100.0%. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
NET OPERATING INCOME DETAIL
(in thousands)
| | | Three Months Ended July 31, 2011 | |
| | | Reporting Segments | | | | | | | |
| | | Multi-Family Residential | | | Commercial Office | | | Commercial Medical | | | Commercial Industrial | | | Commercial Retail | | | Corporate and Other | | | Total | |
| Real estate rental revenue | | | | | | | | | | | | | | | | | | | | | |
Stabilized(1) | | $ | 17,334 | | | | 18,492 | | | | 16,114 | | | | 3,325 | | | | 3,172 | | | $ | 0 | | | $ | 58,437 | |
| Non-Stabilized | | | 148 | | | | 323 | | | | 503 | | | | 110 | | | | 107 | | | | 0 | | | | 1,191 | |
| Total | | | 17,482 | | | | 18,815 | | | | 16,617 | | | | 3,435 | | | | 3,279 | | | | 0 | | | | 59,628 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Real estate expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Stabilized(1) | | | 8,289 | | | | 8,826 | | | | 5,514 | | | | 964 | | | | 1,060 | | | | 0 | | | | 24,653 | |
| Non-Stabilized | | | 77 | | | | 118 | | | | 4 | | | | 2 | | | | 33 | | | | 0 | | | | 234 | |
| Total | | | 8,366 | | | | 8,944 | | | | 5,518 | | | | 966 | | | | 1,093 | | | | 0 | | | | 24,887 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Stabilized(1) | | | 9,045 | | | | 9,666 | | | | 10,600 | | | | 2,361 | | | | 2,112 | | | | 0 | | | | 33,784 | |
| Non-Stabilized | | | 71 | | | | 205 | | | | 499 | | | | 108 | | | | 74 | | | | 0 | | | | 957 | |
| Net operating income | | $ | 9,116 | | | | 9,871 | | | | 11,099 | | | | 2,469 | | | | 2,186 | | | $ | 0 | | | $ | 34,741 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Reconciliation of NOI to net income (loss) available to common shareholders | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Depreciation/amortization | | $ | (3,519 | ) | | | (5,361 | ) | | | (4,193 | ) | | | (881 | ) | | | (848 | ) | | $ | (98 | ) | | $ | (14,900 | ) |
| Administrative, advisory and trustee fees | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (2,181 | ) | | | (2,181 | ) |
| Other expenses | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (315 | ) | | | (315 | ) |
| Interest expense | | | (4,521 | ) | | | (5,198 | ) | | | (3,963 | ) | | | (936 | ) | | | (788 | ) | | | (519 | ) | | | (15,925 | ) |
| Interest and other income | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 153 | | | | 153 | |
| Net income (loss) | | | 1,076 | | | | (688 | ) | | | 2,943 | | | | 652 | | | | 550 | | | | (2,960 | ) | | | 1,573 | |
| Net loss attributable to noncontrolling interests – Operating Partnership | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (178 | ) | | | (178 | ) |
| Net loss attributable to noncontrolling interests – consolidated real estate entities | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 26 | | | | 26 | |
| Net income (loss) attributable to Investors Real Estate Trust | | | 1,076 | | | | (688 | ) | | | 2,943 | | | | 652 | | | | 550 | | | | (3,112 | ) | | | 1,421 | |
| Dividends to preferred shareholders | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (593 | ) | | | (593 | ) |
| NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | | $ | 1,076 | | | | (688 | ) | | | 2,943 | | | | 652 | | | | 550 | | | $ | (3,705 | ) | | $ | 828 | |
| (1) | For Three Months Ended July 31, 2011, stabilized properties excluded: |
Multi-Family Residential - | North Pointe II, Bismarck, ND and Sierra Vista, Sioux Falls, SD. |
| | Total number of units, 68 Occupancy % for July 31, 2011 is 94.1%. |
Commercial Office - | 1st Avenue Building, Minot, ND and Omaha 10802 Farnum Drive, Omaha, NE. |
| | Total square footage 63,001. Occupancy % for July 31, 2011 is 98.7%. |
Commercial Medical - | Billings 2300 Grant Road, Billings, MT; Missoula 3050 Great Northern Avenue, Missoula, MT and Edgewood Vista-Minot, Minot, ND. |
| | Total square footage, 137,848. Occupancy % for July 31, 2011 is 100.0%. |
Commercial Industrial - | Fargo 1320 45th Street North, Fargo, ND. |
| | Total square footage, 42,244. Occupancy % for July 31, 2011 is 100.0%. |
Commercial Retail - | Minot 1400 31st Ave, Minot, ND. |
| | Total square footage, 48,960 Occupancy % for July 31, 2011 is 44.9%. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
NET OPERATING INCOME DETAIL
(in thousands)
| | | Three Months Ended July 31, 2010 | |
| | | Reporting Segments | | | | | | | |
| | | Multi-Family Residential | | | Commercial Office | | | Commercial Medical | | | Commercial Industrial | | | Commercial Retail | | | Corporate and Other | | | Total | |
| Real estate rental revenue | | | | | | | | | | | | | | | | | | | | | |
Stabilized(1) | | $ | 16,167 | | | | 19,891 | | | | 16,284 | | | | 3,353 | | | | 3,417 | | | $ | 0 | | | $ | 59,112 | |
| Non-Stabilized | | | 0 | | | | 2 | | | | 26 | | | | 36 | | | | 0 | | | | 0 | | | | 64 | |
| Total | | | 16,167 | | | | 19,893 | | | | 16,310 | | | | 3,389 | | | | 3,417 | | | | 0 | | | | 59,176 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Real estate expenses | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Stabilized(1) | | | 8,058 | | | | 8,937 | | | | 5,285 | | | | 963 | | | | 1,040 | | | | 0 | | | | 24,283 | |
| Non-Stabilized | | | 0 | | | | 6 | | | | 23 | | | | 1 | | | | 0 | | | | 0 | | | | 30 | |
| Total | | | 8,058 | | | | 8,943 | | | | 5,308 | | | | 964 | | | | 1,312 | | | | 0 | | | | 24,313 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net Operating Income (NOI) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Stabilized(1) | | | 8,109 | | | | 10,954 | | | | 10,999 | | | | 2,390 | | | | 2377 | | | | 0 | | | | 34,829 | |
| Non-Stabilized | | | 0 | | | | (4 | ) | | | 3 | | | | 35 | | | | 0 | | | | 0 | | | | 34 | |
| Net operating income | | $ | 8,109 | | | | 10,950 | | | | 11,002 | | | | 2,425 | | | | 2,377 | | | $ | 0 | | | $ | 34,863 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Reconciliation of NOI to net income (loss) available to common shareholders | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Depreciation/amortization | | $ | (3,362 | ) | | | (5,572 | ) | | | (3,898 | ) | | | (897 | ) | | | (740 | ) | | $ | (97 | ) | | $ | (14,566 | ) |
| Administrative, advisory and trustee services | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (1,969 | ) | | | (1,969 | ) |
| Other expenses | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (353 | ) | | | (353 | ) |
| Interest expense | | | (4,294 | ) | | | (5,571 | ) | | | (4,314 | ) | | | (1,000 | ) | | | (816 | ) | | | (76 | ) | | | (16,071 | ) |
| Interest and other income | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 137 | | | | 137 | |
| Income (loss) from continuing operations before income taxes | | | 453 | | | | (193 | ) | | | 2,790 | | | | 528 | | | | 821 | | | | (2,358 | ) | | | 2,041 | |
| Income tax expense | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (19 | ) | | | (19 | ) |
| Income (loss) from continuing operations | | | 453 | | | | (193 | ) | | | 2,790 | | | | 528 | | | | 821 | | | | (2,377 | ) | | | 2,022 | |
| Income (loss) from discontinued operations | | | 348 | | | | 0 | | | | 4 | | | | (8 | ) | | | (34 | ) | | | 0 | | | | 310 | |
| Net income (loss) | | | 801 | | | | (193 | ) | | | 2,794 | | | | 520 | | | | 787 | | | | (2,377 | ) | | | 2,332 | |
| Net income attributable to noncontrolling interests – Operating Partnership | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (370 | ) | | | (370 | ) |
| Net income attributable to noncontrolling interests – consolidated real estate entities | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 24 | | | | 24 | |
| Net income (loss) attributable to Investors Real Estate Trust | | | 801 | | | | (193 | ) | | | 2,794 | | | | 520 | | | | 787 | | | | (2,723 | ) | | | 1986 | |
| Dividends to preferred shareholders | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | 0 | | | | (593 | ) | | | (593 | ) |
| NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | | $ | 801 | | | | (193 | ) | | | 2,794 | | | | 520 | | | | 787 | | | $ | (3,316 | ) | | $ | 1,393 | |
| 1) | For Three Months Ended July 31, 2010, stabilized properties excluded: |
Commercial Office - | 1st Avenue Building, Minot, ND. |
| | Total square footage, 15,446. Occupancy % for July 31, 2010 is 28.7%. |
Commercial Medical - | Billings 2300 Grant Road, Billings, MT; Missoula 3050 Great Northern Avenue, Missoula, MT and Fox River Cottages, Grand Chute, WI. |
| | Total square footage, 55,681. Occupancy % for July 31, 2010 is 52.7%. |
Commercial Industrial - | Fargo 1320 45th Street North, Fargo, ND. |
| | Total square footage, 42,244. Occupancy % for July 31, 2010 is 100.0%. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
STABILIZED PROPERTIES AND ALL PROPERTIES PHYSICAL OCCUPANCY LEVELS BY SEGMENT
1st Quarter Fiscal 2012 vs. 1st Quarter Fiscal 2011
| Segments | Stabilized Properties | All Properties |
| | 1st Quarter | 1st Quarter | 1st Quarter | 1st Quarter |
| | Fiscal 2012 | Fiscal 2011 | Fiscal 2012 | Fiscal 2011 |
| Multi-Family Residential | 91.5% | 85.8% | 91.5% | 85.8% |
| Commercial Office | 78.1% | 82.1% | 78.4% | 81.9% |
| Commercial Medical | 95.5% | 96.0% | 95.7% | 95.1% |
| Commercial Industrial | 94.6% | 88.9% | 94.7% | 89.1% |
| Commercial Retail | 86.6% | 84.1% | 85.2% | 84.1% |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
COMMERCIAL LEASING SUMMARY
for the three months ended July 31, 2011
| | | Three Months Ended July 31, 2011 | |
| | | New(1) | | | Renew(2) | | | Total | | | Expiring(3) | | | Net Change | | | Percentage Change | |
| Gross Square Footage | | | | | | | | | | | | | | | | | | |
| Commercial Office | | | 30,532 | | | | 158,070 | | | | 188,602 | | | | 188,104 | | | | 498 | | | | |
| Commercial Medical | | | 7,640 | | | | 19,457 | | | | 27,097 | | | | 33,748 | | | | (6,651 | ) | | | |
| Commercial Industrial | | | 0 | | | | 194,108 | | | | 194,108 | | | | 13,870 | | | | 180,238 | | | | |
| Commercial Retail | | | 21,287 | | | | 38,639 | | | | 59,926 | | | | 137,089 | | | | (77,163 | ) | | | |
| Total All Segments | | | 59,459 | | | | 410,274 | | | | 469,733 | | | | 372,811 | | | | 96,922 | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Weighted Average Rental Rates(3) | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial Office | | $ | 9.82 | | | $ | 9.98 | | | $ | 9.95 | | | $ | 10.58 | | | $ | (0.63 | ) | | | (6.0 | %) |
| Commercial Medical | | | 16.00 | | | | 16.43 | | | | 16.31 | | | | 18.79 | | | | (2.48 | ) | | | (13.2 | %) |
| Commercial Industrial | | | 0.00 | | | | 1.48 | | | | 1.48 | | | | 2.70 | | | | (1.22 | ) | | | (45.2 | %) |
| Commercial Retail | | | 3.73 | | | | 12.59 | | | | 9.44 | | | | 4.33 | | | | 5.11 | | | | 118.0 | % |
| Total All Segments | | $ | 8.43 | | | $ | 6.51 | | | $ | 6.75 | | | $ | 8.74 | | | $ | (1.99 | ) | | | (22.8 | %) |
| | Three Months Ended July 31, 2011 |
| | New(1) | Renew(2) | Total |
Weighted Average Term of New/Renewed Leased(4) | | | | | | |
| Commercial Office | | 4.5 | | 3.8 | | 4.0 |
| Commercial Medical | | 0.4 | | 4.9 | | 4.4 |
| Commercial Industrial | | 0.0 | | 3.0 | | 3.0 |
| Commercial Retail | | 7.5 | | 5.4 | | 6.0 |
| Total All Segments | | 4.7 | | 4.4 | | 4.5 |
| (1) | Does not include leases in place on acquired properties. |
| (2) | Renewals may include leases that have renewed prior to expiration date. Square footage or rental rate changes on renewals are included in calculation. |
| (3) | Expired leases include leases with tenants who have vacated or renewed. Excluded from expired leases are leases that have been amended to extend the term, including leases on a month-to-month basis. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
COMMERCIAL LEASING COMMITTMENTS
for the three months ended July 31, 2011
| | | 1st Quarter Fiscal 2012 Total | |
| | | New | | | Renew | | | Total Dollars | |
| Tenant Improvements | | | | | | | | | |
| Commercial Office | | $ | 370,985 | | | $ | 471,777 | | | $ | 842,762 | |
| Commercial Medical | | | 0 | | | | 172,450 | | | | 172,450 | |
| Commercial Industrial | | | 0 | | | | 70,000 | | | | 70,000 | |
| Commercial Retail | | | 22,500 | | | | 18,846 | | | | 41,346 | |
| Subtotal | | $ | 393,485 | | | $ | 733,073 | | | $ | 1,126,558 | |
| | | | | | | | | | | | | |
| Tenant Improvements per square foot | | | | | | | | | | | | |
| Commercial Office | | $ | 12.15 | | | $ | 2.98 | | | $ | 4.47 | |
| Commercial Medical | | | 0.00 | | | | 8.86 | | | | 6.36 | |
| Commercial Industrial | | | 0.00 | | | | 0.36 | | | | 0.36 | |
| Commercial Retail | | | 1.06 | | | | 0.49 | | | | 0.69 | |
| All Segments | | $ | 6.62 | | | $ | 1.79 | | | $ | 2.40 | |
| | | | | | | | | | | | | |
| Leasing Costs | | | | | | | | | | | | |
| Commercial Office | | $ | 186,772 | | | $ | 337,142 | | | $ | 523,914 | |
| Commercial Medical | | | 3,591 | | | | 83,812 | | | | 87,403 | |
| Commercial Industrial | | | 0 | | | | 41,900 | | | | 41,900 | |
| Commercial Retail | | | 0 | | | | 7,996 | | | | 7,996 | |
| Subtotal | | $ | 190,363 | | | $ | 470,850 | | | $ | 661,213 | |
| | | | | | | | | | | | | |
| Leasing Costs per square foot | | | | | | | | | | | | |
| Commercial Office | | $ | 6.12 | | | $ | 2.13 | | | $ | 2.78 | |
| Commercial Medical | | | 0.47 | | | | 4.31 | | | | 3.23 | |
| Commercial Industrial | | | 0.00 | | | | 0.22 | | | | 0.22 | |
| Commercial Retail | | | 0.00 | | | | 0.21 | | | | 0.13 | |
| All Segments | | $ | 3.20 | | | $ | 1.15 | | | $ | 1.41 | |
| | | | | | | | | | | | | |
| Tenant Improvements and Leasing Costs | | | | | | | | | | | | |
| Commercial Office | | $ | 557,757 | | | $ | 808,919 | | | $ | 1,366,676 | |
| Commercial Medical | | | 3,591 | | | | 256,262 | | | | 259,853 | |
| Commercial Industrial | | | 0 | | | | 111,900 | | | | 111,900 | |
| Commercial Retail | | | 22,500 | | | | 26,842 | | | | 49,342 | |
| Total | | $ | 583,848 | | | $ | 1,203,923 | | | $ | 1,787,771 | |
| | | | | | | | | | | | | |
| Tenant Improvements and Leasing Costs per square foot | | | | | | | | | | | | |
| Commercial Office | | $ | 18.27 | | | $ | 5.12 | | | $ | 7.25 | |
| Commercial Medical | | | 0.47 | | | | 13.17 | | | | 9.59 | |
| Commercial Industrial | | | 0.00 | | | | 0.58 | | | | 0.58 | |
| Commercial Retail | | | 1.06 | | | | 0.69 | | | | 0.82 | |
| All Segments | | $ | 9.82 | | | $ | 2.93 | | | $ | 3.81 | |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
MULTI-FAMILY RESIDENTIAL SUMMARY
| | | Three Months Ended | |
| | | 07/31/2011 | | | 04/30/2011 | | | 01/31/2011 | | | 10/31/2010 | | | 07/31/2010 | |
| Number of Units | | | 8,664 | | | | 8,661 | | | | 8,593 | | | | 8,590 | | | | 8,590 | |
| Average Investment Per Unit | | | | | | | | | | | | | | | | | | | | |
| Stabilized | | $ | 56,093 | | | $ | 55,922 | | | $ | 55,866 | | | $ | 55,561 | | | $ | 55,283 | |
| Non-Stabilized | | | 62,078 | | | | 61,947 | | | | 0 | | | | 0 | | | | 0 | |
| | | $ | 56,140 | | | $ | 55,969 | | | $ | 55,866 | | | $ | 55,561 | | | $ | 55,283 | |
| | | | | | | | | | | | | | | | | | | | | |
Average Scheduled Rent(1) per Unit | | | | | | | | | | | | | | | | | | | | |
| Stabilized | | $ | 701 | | | $ | 698 | | | $ | 697 | | | $ | 699 | | | $ | 696 | |
| Non-Stabilized | | | 715 | | | | 567 | | | | 0 | | | | 0 | | | | 0 | |
| | | $ | 701 | | | $ | 697 | | | $ | 697 | | | $ | 699 | | | $ | 696 | |
| | | | | | | | | | | | | | | | | | | | | |
| Total Receipts per Unit | | | | | | | | | | | | | | | | | | | | |
| Stabilized | | $ | 672 | | | $ | 665 | | | $ | 655 | | | $ | 642 | | | $ | 627 | |
| Non-Stabilized | | | 726 | | | | 538 | | | | 0 | | | | 0 | | | | 0 | |
| | | $ | 673 | | | $ | 664 | | | $ | 655 | | | $ | 642 | | | $ | 627 | |
| | | | | | | | | | | | | | | | | | | | | |
Total Recurring Capital Expenditures per Unit(1) | | | | | | | | | | | | | | | | | | | | |
| Stabilized | | $ | 230 | | | $ | 144 | | | $ | 146 | | | $ | 165 | | | $ | 131 | |
| Non-Stabilized | | | 113 | | | | 105 | | | | 0 | | | | 0 | | | | 0 | |
| | | $ | 229 | | | $ | 144 | | | $ | 146 | | | $ | 165 | | | $ | 131 | |
| | | | | | | | | | | | | | | | | | | | | |
| Physical Occupancy% | | | | | | | | | | | | | | | | | | | | |
| Stabilized | | | 91.5 | % | | | 92.8 | % | | | 91.1 | % | | | 90.6 | % | | | 85.8 | % |
| Non-Stabilized | | | 94.1 | % | | | 89.7 | % | | | 0.0 | % | | | 0.0 | % | | | 0.0 | % |
| | | | 91.5 | % | | | 92.8 | % | | | 91.1 | % | | | 90.6 | % | | | 85.8 | % |
| | | | | | | | | | | | | | | | | | | | | |
| Operating Expenses as a % of Scheduled Rent | | | | | | | | | | | | | | | | | | | | |
| Stabilized | | | 46.3 | % | | | 49.4 | % | | | 49.7 | % | | | 46.1 | % | | | 44.9 | % |
| Non-Stabilized | | | 52.4 | % | | | 47.4 | % | | | 0.0 | % | | | 0.0 | % | | | 0.0 | % |
| Total | | | 46.3 | % | | | 49.4 | % | | | 49.7 | % | | | 46.1 | % | | | 44.9 | % |
| (1) | See Definitions on page 25. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
10 LARGEST COMMERCIAL TENANTS – BASED ON ANNUALIZED BASE RENT(1)
as of July 31, 2011
| Tenant | Number of Properties | Average Remaining Lease Term in Months | % of Total Commercial Segments’ Minimum Rents | Aggregate Rentable Square Feet | % of Aggregate Occupied Square Feet |
| Affiliates of Edgewood Vista | 20 | 206 | 10.8% | 1,040,649 | 9.8% |
| St. Lukes Hospital of Duluth, Inc. | 6 | 54 | 3.5% | 198,775 | 1.9% |
| Fairview Health Services | 9 | 56 | 3.2% | 238,932 | 2.2% |
| Applied Underwriters | 3 | 67 | 2.3% | 141,724 | 1.3% |
| Affiliates of Siemens USA | 2 | 7 | 2.1% | 186,224 | 1.8% |
| HealthEast Care System | 1 | 91 | 1.7% | 114,316 | 1.1% |
| Microsoft (NASDAQ: MSFT) | 1 | 25 | 1.4% | 122,040 | 1.1% |
| Smurfit - Stone Container (NASDAQ: SSCC) | 2 | 52 | 1.4% | 406,397 | 3.8% |
| Nebraska Orthopedic Hospital | 1 | 212 | 1.3% | 61,758 | 0.6% |
| Arcadis Corporate Services, Inc. | 1 | 60 | 1.2% | 71,430 | 0.7% |
| Total/Weighted Average | | 94 | 28.9% | 2,582,245 | 24.3% |
| (1) | See Definitions on page 25. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
LEASE EXPIRATIONS
as of July 31, 2011
| Fiscal Year | | Number of Leases | | | Rentable Square Feet | | | % of Rentable Square Feet | | | Annualized Rent* | | | Average Rental Rate | | | % of Annualized Rent | |
| Commercial Office | | | | | | | | | | | | | | | | | | |
| 2012 | | | 44 | | | | 548,723 | | | | 14.0 | % | | $ | 8,032,418 | | | $ | 14.64 | | | | 14.5 | % |
| 2013 | | | 46 | | | | 541,890 | | | | 13.9 | % | | | 7,496,243 | | | | 13.83 | | | | 13.6 | % |
| 2014 | | | 51 | | | | 611,108 | | | | 15.6 | % | | | 8,085,855 | | | | 13.23 | | | | 14.6 | % |
| 2015 | | | 58 | | | | 437,520 | | | | 11.2 | % | | | 6,307,192 | | | | 14.42 | | | | 11.4 | % |
| 2016 | | | 36 | | | | 472,029 | | | | 12.1 | % | | | 6,719,189 | | | | 14.23 | | | | 12.2 | % |
| 2017 and thereafter | | | 49 | | | | 1,298,292 | | | | 33.2 | % | | | 18,663,336 | | | | 14.38 | | | | 33.7 | % |
| | | | 284 | | | | 3,909,562 | | | | 100.0 | % | | $ | 55,304,233 | | | $ | 14.15 | | | | 100.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial Medical | | | | | | | | | | | | | | | | | | | | | | | | |
| 2012 | | | 26 | | | | 89,170 | | | | 3.5 | % | | $ | 1,802,042 | | | $ | 20.21 | | | | 3.9 | % |
| 2013 | | | 20 | | | | 109,006 | | | | 4.2 | % | | | 2,416,824 | | | | 22.17 | | | | 5.2 | % |
| 2014 | | | 28 | | | | 393,484 | | | | 15.3 | % | | | 7,170,736 | | | | 18.22 | | | | 15.3 | % |
| 2015 | | | 13 | | | | 56,428 | | | | 2.2 | % | | | 1,356,206 | | | | 24.03 | | | | 2.9 | % |
| 2016 | | | 25 | | | | 176,413 | | | | 6.8 | % | | | 3,564,975 | | | | 20.21 | | | | 7.6 | % |
| 2017 and thereafter | | | 75 | | | | 1,755,151 | | | | 68.0 | % | | | 30,403,566 | | | | 17.32 | | | | 65.1 | % |
| | | | 187 | | | | 2,579,652 | | | | 100.0 | % | | $ | 46,714,349 | | | $ | 18.11 | | | | 100.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial Industrial | | | | | | | | | | | | | | | | | | | | | | | | |
| 2012 | | | 8 | | | | 821,944 | | | | 30.2 | % | | $ | 2,233,623 | | | $ | 2.72 | | | | 22.3 | % |
| 2013 | | | 3 | | | | 154,685 | | | | 5.7 | % | | | 720,993 | | | | 4.66 | | | | 7.2 | % |
| 2014 | | | 8 | | | | 234,078 | | | | 8.6 | % | | | 955,958 | | | | 4.08 | | | | 9.6 | % |
| 2015 | | | 3 | | | | 76,200 | | | | 2.8 | % | | | 459,650 | | | | 6.03 | | | | 4.6 | % |
| 2016 | | | 8 | | | | 784,327 | | | | 28.9 | % | | | 3,142,911 | | | | 4.01 | | | | 31.4 | % |
| 2017 and thereafter | | | 9 | | | | 648,015 | | | | 23.8 | % | | | 2,488,919 | | | | 3.84 | | | | 24.9 | % |
| | | | 39 | | | | 2,719,249 | | | | 100.0 | % | | $ | 10,002,054 | | | $ | 3.68 | | | | 100.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial Retail | | | | | | | | | | | | | | | | | | | | | | | | |
| 2012 | | | 34 | | | | 173,240 | | | | 14.4 | % | | $ | 1,105,426 | | | $ | 6.38 | | | | 11.6 | % |
| 2013 | | | 31 | | | | 94,058 | | | | 7.8 | % | | | 734,614 | | | | 7.81 | | | | 7.7 | % |
| 2014 | | | 37 | | | | 204,102 | | | | 17.0 | % | | | 1,282,479 | | | | 6.28 | | | | 13.4 | % |
| 2015 | | | 25 | | | | 267,601 | | | | 22.3 | % | | | 2,014,975 | | | | 7.53 | | | | 21.1 | % |
| 2016 | | | 20 | | | | 90,751 | | | | 7.6 | % | | | 1,087,619 | | | | 11.98 | | | | 11.4 | % |
| 2017 and thereafter | | | 24 | | | | 371,665 | | | | 30.9 | % | | | 3,331,916 | | | | 8.96 | | | | 34.8 | % |
| | | | 171 | | | | 1,201,417 | | | | 100.0 | % | | $ | 9,557,029 | | | $ | 7.95 | | | | 100.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Commercial Total | | | | | | | | | | | | | | | | | | | | | | | | |
| 2012 | | | 112 | | | | 1,633,077 | | | | 15.7 | % | | $ | 13,173,509 | | | $ | 8.07 | | | | 10.8 | % |
| 2013 | | | 100 | | | | 899,639 | | | | 8.6 | % | | | 11,368,674 | | | | 12.64 | | | | 9.4 | % |
| 2014 | | | 124 | | | | 1,442,772 | | | | 13.9 | % | | | 17,495,028 | | | | 12.13 | | | | 14.4 | % |
| 2015 | | | 99 | | | | 837,749 | | | | 8.1 | % | | | 10,138,023 | | | | 12.10 | | | | 8.3 | % |
| 2016 | | | 89 | | | | 1,523,520 | | | | 14.6 | % | | | 14,514,694 | | | | 9.53 | | | | 11.9 | % |
| 2017 and thereafter | | | 157 | | | | 4,073,123 | | | | 39.1 | % | | | 54,887,737 | | | | 13.48 | | | | 45.2 | % |
| | | | 681 | | | | 10,409,880 | | | | 100.0 | % | | $ | 121,577,665 | | | $ | 11.68 | | | | 100.0 | % |
| * | Annualized Rent is monthly scheduled rent as of July 31, 2011 (cash basis), multiplied by 12. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
FISCAL 2012 ACQUISITION SUMMARY
as of July 31, 2011
($’s in thousands)
| Property | Location | Segment Type | Acquisition Date | | Square Feet/Units | | | Leased Percentage At Acquisition | | | July 31, 2011 Leased Percentage | | | Acquisition Cost | |
| | | | | | | | | | | | | | | | |
Buffalo Mall Theaters1 | Jamestown, ND | Commercial Retail | June 15, 2011 | | | 19,037 | | | | 100.0 | % | | | 100.0 | % | | $ | 764 | |
| | | | Total Square Feet | | | 19,037 | | | | | | | | | | | $ | 764 | |
| | | | Total Units | | | 0 | | | | | | | | | | | | | |
| (1) | Conversion project placed in service June 15, 2011. Additional costs incurred in fiscal year 2011 totaled $1.4 million, for a total project cost at July 31, 2011 of $2.2 million. |
INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES
FISCAL 2012 DEVELOPMENT SUMMARY
as of July 31, 2011
($’s in thousands)
| Property and Location | Total Rentable Square Feet or # of Units | | Percentage Leased or Committed | | | Anticipated Total Cost | | | Cost to Date | | Anticipated Construction Completion |
| Multi-Family Conversion - Minot, ND | Convert 15,446 sf. commercial office to 24 multi-family residential units | | | 0 | % | | | 2,200 | | | | 319 | | 4th Quarter Fiscal 2012 |
| Meadow Wind, Casper, WY | 28 assisted living units and 16 memory care units | | | 0 | % | | | 4,500 | | | | 814 | | 3rd Quarter Fiscal 2012 |
| Trinity Hospital Build-to-Suit, Minot, ND | 24,544 sf. one story medical clinic | | | 100 | % | | | 7,380 | | | | 7,288 | | 2nd Quarter Fiscal 2012 |
| Quarry Ridge II Apartments, Rochester, MN | 159 unit apartment building | | | 0 | % | | | 19,400 | | | | 1,437 | | 2nd Quarter Fiscal 2013 |
| Georgetown Square Condos - Grand Chute, WI | 8 condo units | | | 0 | % | | NA | | | | 1,779 | | 2nd Quarter Fiscal 2012 |
| Other | | | NA | | | NA | | | | 1,060 | | |
| | | | Total | | | $ | 33,480 | | | $ | 12,697 | | |
Definitions
July 31, 2011
Annualized base rent (ABR) is calculated as monthly base rent (cash basis) per the lease, as of the reporting period, multiplied by 12.
Debt to total market capitalization is total debt from the balance sheet divided by the sum of total debt from the balance sheet plus the market value of shares outstanding at the end of the period.
Debt service coverage ratio is computed by dividing earnings before interest income and expense, depreciation, amortization and gain on sale of real estate by interest expense and principal amortization.
EBITDA is earnings before interest, taxes, depreciation and amortization. We consider EBITDA to be an appropriate supplemental performance measure because it eliminates depreciation, interest and the gain/loss from property dispositions, which permits investors to view income from operations without the effect of non-cash depreciation or the cost of debt; however, EBIDTA as we calculate it has not been adjusted for the effect of nonrecurring events such as asset impairment and gain/loss on involuntary conversion. EBITDA is a non-GAAP measure. EBITDA as calculated by us is not comparable to EBITDA reported by other REITs that do not define EBITDA exactly as we do.
Funds from operations (FFO) - The National Association of Real Estate Investment Trusts, Inc. (NAREIT) defines FFO as “net income (computed in accordance with generally accepted accounting principles, excluding gains (or losses) from sales of property, plus real estate depreciation and amortization, and adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis.” FFO is a non-GAAP measure. We consider FFO to be a standard supplemental measure for equity real estate investment trusts because it facilitates an understanding of the operating performance of properties without giving effect to real estate depreciation and amortization, which assume that the value of real estate assets diminishes predictably over time. Since real estate values instead historically rise or fall with market conditions, we believe that FFO provides investors and management with a more accurate indication of our financial and operating results.
Net Operating Income is total real estate revenues less real estate expenses and real estate taxes (which consist of utilities, maintenance, real estate taxes, insurance and property management expenses).
Payout ratio (FFO per share and unit basis) - The ratio of the current quarterly or annual distribution rate per common share and unit divided by quarterly or annual FFO per share and unit.
Ratio of earnings to fixed charges - The ratio of earnings to fixed charges is computed by dividing earnings by fixed charges. For this purpose, earnings consist of income from continuing operations plus fixed charges and preferred distributions, less adjustments for noncontrolling interests - consolidated real estate entities, capitalized interest and preferred distributions. Fixed charges consist of mortgage and loan interest expense, whether expensed or capitalized, the amortization of debt expense and capitalized interest.
Ratio of earnings to combined fixed charges and preferred distributions - The ratio of earnings to combined fixed charges and preferred distributions is computed by dividing earnings by combined fixed charges and preferred distributions. For this purpose, earnings consist of income from continuing operations plus fixed charges and preferred distributions, less adjustments for noncontrolling interests - consolidated real estate entities, capitalized interest and preferred distributions. Combined fixed charges and preferred distributions consist of fixed charges (mortgage and loan interest expense, whether expensed or capitalized, the amortization of debt expense and capitalized interest) and preferred distributions.
Recurring capital expenditures are costs that increase the value and extend the useful life of a property. Ordinary repair and maintenance costs that do not extend the useful life of the asset are expensed as incurred. Costs incurred on a lease turnover due to normal wear and tear by the resident are expensed on the turn. Recurring capital expenditures typically include appliances, carpeting and flooring, and kitchen/bath cabinets.
Scheduled rent revenue is the total possible revenue from all leasable units and square footage, with occupied space valued at contract rates pursuant to leases and vacant units or square footage at market rates.
Stabilized properties are those properties owned for the entirety of both periods being compared, and, in the case of development or re-development properties, which have achieved a target level of occupancy.
