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| | Earnings Release |
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| | Consolidated Statements of Operations |
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| | Consolidated Balance Sheets |
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| | Schedule 1 – Funds From Operations and Adjusted Funds From Operations |
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| | Schedule 2 – Proportionate Adjusted Funds From Operations Presentation |
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| | Schedule 3 – Proportionate Property Net Operating Income |
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| | Schedule 4 – Proportionate Balance Sheet Data |
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| | Schedule 5 – Capitalization and Financial Metrics |
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| | Schedule 6 – Conventional Same Store Operating Results |
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| | Schedule 7 – Conventional Portfolio Data by Market |
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| | Schedule 8 – Apartment Community Disposition and Acquisition Activity |
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| | Schedule 9 – Capital Additions |
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| | Schedule 10 – Redevelopment and Development Portfolio |
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| | Glossary and Reconciliations of Non-GAAP Financial and Operating Measures |
Aimco Reports Second Quarter Results, Raises 2016 Guidance
Denver, Colorado, July 28, 2016 - Apartment Investment and Management Company (“Aimco”) (NYSE: AIV) announced today second quarter 2016 results and raised full year 2016 guidance.
Chairman and Chief Executive Officer Terry Considine comments: “At a time when various markets are impacted by new supply, we appreciate the diversification...both geographic and price point...of the Aimco portfolio. That diversification reduces volatility and makes revenue more predictable. Operating results were in line with guidance. We are on-track with lease-up efforts at One Canal in Boston and at Indigo in Redwood City, California. Construction continues at two phased redevelopments in Center City Philadelphia where new phases were started. Portfolio quality improved as revenue per apartment home was up 8% to $1,900.”
Chief Financial Officer Paul Beldin adds: “Second quarter AFFO of $0.50 per share increased 9% compared to second quarter 2015 and was $0.03 per share ahead of the midpoint of our guidance range. This outperformance was due to greater than planned non-core earnings, including $0.01 per share related to transactional revenues originally anticipated later in the year. We are increasing our full year Pro forma FFO and AFFO guidance by $0.01 at the midpoint of our guidance range to take into account the $0.02 of outperformance, offset by a $0.01 reduction due to the decision to vacate the North Tower at Park Towne Place as we accelerate its redevelopment timeline.”
Financial Results: Second Quarter AFFO Up 9% Year-Over-Year
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| SECOND QUARTER | | YEAR-TO-DATE |
(all items per common share - diluted) | 2016 | | 2015 | | Variance | | 2016 | | 2015 | | Variance |
Net income | $ | 1.41 |
| | $ | 0.39 |
| | 262 | % | | $ | 1.57 |
| | $ | 0.97 |
| | 62 | % |
Funds From Operations (FFO) | $ | 0.59 |
| | $ | 0.56 |
| | 5 | % | | $ | 1.16 |
| | $ | 1.07 |
| | 8 | % |
Add back Aimco share of preferred equity redemption related amounts | $ | — |
| | $ | — |
| | — | % | | $ | — |
| | $ | 0.01 |
| | (100 | )% |
Pro forma Funds From Operations (Pro forma FFO) | $ | 0.59 |
| | $ | 0.56 |
| | 5 | % | | $ | 1.16 |
| | $ | 1.08 |
| | 7 | % |
Deduct Aimco share of Capital Replacements | $ | (0.09 | ) | | $ | (0.10 | ) | | (10 | )% | | $ | (0.15 | ) | | $ | (0.16 | ) | | (6 | )% |
Adjusted Funds From Operations (AFFO) | $ | 0.50 |
| | $ | 0.46 |
| | 9 | % | | $ | 1.01 |
| | $ | 0.92 |
| | 10 | % |
Net Income (per diluted common share) - Year-over-year, second quarter net income increased primarily due to higher gains on property sales in second quarter 2016, as compared to 2015.
Pro forma FFO (per diluted common share) - Year-over-year, second quarter Pro forma FFO increased 5% as a result of: Conventional Same Store Property Net Operating Income growth; increased contribution from redevelopment and acquisition communities; and higher non-core earnings. These increases were partially offset by the loss of income from apartment communities that were sold in 2015.
Adjusted Funds from Operations (per diluted common share) - Year-over-year, second quarter AFFO increased 9% as a result of higher Pro forma FFO. As Aimco concentrates its investment capital in higher quality, higher price point apartment communities, its free cash flow margins are increasing and contributing to a higher AFFO growth rate.
Operating Results: Second Quarter Conventional Same Store NOI Up 4.1%
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| | | | | | | | | | | | | | | | |
| SECOND QUARTER | YEAR-TO-DATE |
| Year-over-Year | Sequential | Year-over-Year |
| 2016 | 2015 | Variance | 1st Qtr. | Variance | 2016 | 2015 | Variance |
Average Rent Per Apartment Home | $1,611 | $1,530 | 5.3 | % | $1,595 | 1.0 | % | $1,603 | $1,523 | 5.3 | % |
Other Income Per Apartment Home | 188 | 187 | 0.5 | % | 187 | 0.5 | % | 187 | 186 | 0.5 | % |
Average Revenue Per Apartment Home | $1,799 | $1,717 | 4.8 | % | $1,782 | 1.0 | % | $1,790 | $1,709 | 4.7 | % |
Average Daily Occupancy | 95.9 | % | 96.4 | % | (0.5 | )% | 96.0 | % | (0.1 | )% | 96.0 | % | 96.2 | % | (0.2 | )% |
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$ in Millions | | | | | | | | |
Revenue | $168.5 | $161.6 | 4.2 | % | $167.1 | 0.8 | % | $335.6 | $321.2 | 4.5 | % |
Expenses | 52.9 | 50.6 | 4.6 | % | 52.5 | 0.8 | % | 105.4 | 103.0 | 2.3 | % |
NOI | $115.6 | $111.0 | 4.1 | % | $114.6 | 0.8 | % | $230.2 | $218.2 | 5.5 | % |
Conventional Same Store Rental Rates - Aimco measures changes in rental rates by comparing, on a lease-by-lease basis, the rate on a newly executed lease to the rate on the expiring lease for that same apartment. Newly executed leases are classified either as a new lease, where a vacant apartment is leased to a new customer, or as a renewal. The table below details new and renewal lease rates for Aimco’s second quarter 2016 Same Store portfolio.
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2016 | 1st Qtr. | Apr | May | Jun | 2nd Qtr. | Year-to-Date |
Renewal rent increases | 6.0% | 6.4% | 5.9% | 6.4% | 6.2% | 6.1% |
New lease rent increases | 3.5% | 4.0% | 4.3% | 4.9% | 4.4% | 4.0% |
Weighted average rent increases | 4.6% | 5.1% | 5.1% | 5.6% | 5.3% | 5.0% |
Conventional Non-Same Store NOI - Aimco’s Conventional non-Same Store NOI for second quarter 2016 increased 13.4% year-over-year primarily due to increasing contribution from Aimco’s Redevelopment apartment communities.
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| SECOND QUARTER | YEAR-TO-DATE |
| Year-over-Year | Sequential | Year-over-Year |
$ in Millions | 2016 | 2015 | Variance | 1st Qtr. | Variance | 2016 | 2015 | Variance |
Conventional Redevelopment and Development | $15.1 | $12.9 | 17.1 | % | $15.2 | (0.7 | )% | $30.3 | $24.3 | 24.7 | % |
Conventional Acquisition | 0.8 | 0.0 | n/a |
| 0.8 | — |
| 1.6 | 0.1 | n/a |
|
Conventional Other | 6.1 | 6.5 | (6.2 | )% | 6.0 | 1.7 | % | 12.1 |
| 12.1 |
| — |
|
Total Conventional non-Same Store | $22.0 | $19.4 | 13.4 | % | $22.0 | — |
| $44.0 | $36.5 | 20.5 | % |
Redevelopment and Development: Progressing as Planned
During second quarter, Aimco invested $43 million in redevelopment, $31 million of which related to the ongoing redevelopment of Park Towne Place and The Sterling, mixed-use communities located in Center City Philadelphia. At Park Towne Place, as of June 30, 2016, Aimco had completed redevelopment of 356 apartment homes and had leased 73% of the completed homes. Rental rates are above underwriting. Based on the success of earlier phases of the Park Towne Place redevelopment, during the second quarter, Aimco decided to proceed with redevelopment of a third tower with 227 apartment homes. At The Sterling, as of June 30, 2016, Aimco had completed redevelopment of 343 of the 534 apartment homes in the community and had leased 88% of the completed homes. Rental rates are above underwriting. Based on the success of earlier phases of redevelopment of The Sterling, in the second quarter, Aimco decided to proceed with the final phase,
and anticipates completion in spring 2017. Projected returns on these newly approved phases at both Park Towne Place and The Sterling are similar to those of the previous phases.
During second quarter, Aimco invested $13.2 million in the substantial completion of One Canal in Boston. Leasing is progressing as planned and at June 30, 2016, 35% of the apartment homes were leased and rental rates are ahead of underwriting.
Portfolio Management: Revenue Per Apartment Home Up 8% to $1,900
Aimco portfolio strategy seeks predictable rent growth from a portfolio of apartment communities that is diversified across “A,” “B” and “C+” price points, averaging “B/B+” in quality, and that is also diversified across large coastal and job growth markets in the U.S. Aimco target markets are primarily coastal markets, and also include several Sun Belt cities and Chicago, Illinois. Please refer to the Glossary for a description of Aimco’s Portfolio Quality Ratings.
As part of its portfolio strategy, Aimco seeks to sell each year the lowest-rated 5% to 10% of its portfolio and to reinvest the proceeds from such sales in higher quality apartment communities through redevelopment of communities in its current portfolio, occasional development of new communities, and selective acquisitions. Through this disciplined approach to capital recycling, Aimco has significantly increased the quality and expected growth rate of its portfolio.
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| SECOND QUARTER |
| 2016 | 2015 | Variance |
Conventional Apartment Communities | 137 |
| 143 |
| (6 | ) |
Conventional Apartment Homes | 38,841 |
| 41,425 |
| (2,584 | ) |
Conventional % NOI in Target Markets | 91 | % | 89 | % | 2 | % |
Revenue per Apartment Home | $ | 1,900 |
| $ | 1,759 |
| 8 | % |
Portfolio Average Rents as a Percentage of Local Market Average Rents | 113 | % | 110 | % | 3 | % |
Percentage A (2Q 2016 Revenue per Apartment Home $2,386) | 51 | % | 50 | % | 1 | % |
Percentage B (2Q 2016 Revenue per Apartment Home $1,719) | 37 | % | 33 | % | 4 | % |
Percentage C+ (2Q 2016 Revenue per Apartment Home $1,546) | 12 | % | 17 | % | (5 | )% |
NOI Margin | 67 | % | 67 | % | — |
|
Free Cash Flow Margin* | 62 | % | 61 | % | 1 | % |
* Assumes Capital Replacements spending of $1,200 per apartment home.
Second Quarter 2016 Portfolio Transactions - In second quarter, Aimco sold two Conventional apartment communities with 1,547 apartment homes for $291.9 million in gross proceeds. Net sales proceeds after payment of transaction costs were $289.4 million. Aimco did not acquire any apartment communities during the second quarter.
Quarter-End Portfolio - Second quarter 2016 Conventional portfolio average monthly revenue per apartment home was $1,900, an 8% increase compared to second quarter 2015, due to: year-over-year Same Store monthly revenue per apartment home growth of 4.8%; the sale of Conventional apartment communities in 2015 and 2016 with average monthly revenues per apartment home substantially lower than those of the retained portfolio; and reinvestment of the sales proceeds through redevelopment, development and acquisition of apartment communities with higher rents and better prospects.
Bay Area Acquisition Update - As previously reported, Aimco has agreed to acquire for $320 million, Indigo, an apartment community with 463 apartment homes currently under construction in Redwood City, California. Closing of the acquisition is expected upon completion of construction, anticipated to occur by the end of third quarter 2016. At June 30, 2016, Aimco had leased 18% of the apartment homes and rental rates are above underwriting. Move-ins commenced on July 1st.
Balance Sheet and Liquidity:
Components of Aimco Leverage |
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| AS OF JUNE 30, 2016 |
$ in Millions | Amount | % of Total | Weighted Avg. Maturity (Yrs.) |
Aimco share of long-term, non-recourse property debt | $ | 3,680.2 |
| 90 | % | 7.7 |
|
Outstanding borrowings on revolving credit facility | 160.5 |
| 4 | % | 2.3 |
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Preferred securities* | 246.0 |
| 6 | % | 34.4 |
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Total leverage | $ | 4,086.7 |
| 100 | % | 9.0 |
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* | Aimco’s preferred securities are perpetual in nature; however, for illustrative purposes, Aimco has computed the weighted average maturity of its total leverage assuming a 30-day maturity on the Class Z Cumulative Preferred Stock, which Aimco will redeem on July 29, 2016, and a 40-year maturity on its other preferred securities. |
Non-recourse Property Debt - During the second quarter, Aimco priced two fixed rate, non-recourse, amortizing, 10-year property loans totaling $166.5 million at interest rates of 2.77% and 3.34%, spreads of 129 basis points and 152 basis points, respectively, over the 10-year Treasury rates at the time of pricing.
Preferred Securities - During the second quarter, Aimco called for the redemption of all outstanding shares of its Class Z Cumulative Preferred Stock on July 29, 2016, at a redemption value including dividends through the redemption date of approximately $35 million.
Leverage Ratios
Aimco target leverage ratios are: Debt and Preferred Equity to EBITDA below 7.0x; and EBITDA to Interest Expense and Preferred Dividends greater than 2.5x. Aimco also focuses on the ratios of Debt to EBITDA and EBITDA to Interest Expense. Please see the Glossary for definitions of these metrics and, where appropriate, reconciliations to GAAP.
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| TRAILING-TWELVE MONTHS ENDED JUNE 30, |
| 2016 | 2015 |
Debt to EBITDA | 6.4x | 6.5x |
Debt and Preferred Equity to EBITDA | 6.8x | 7.0x |
EBITDA to Interest Expense | 3.3x | 2.9x |
EBITDA to Interest Expense and Preferred Dividends | 3.0x | 2.6x |
Future leverage reduction is expected from earnings growth, especially as apartment communities now being redeveloped or developed are completed and leased, and from regularly scheduled property debt amortization funded from retained earnings.
Liquidity
Aimco’s only recourse debt at June 30, 2016, was its revolving credit facility, which Aimco uses for working capital and other short-term purposes, and to secure letters of credit.
At June 30, 2016, Aimco had outstanding borrowings on its revolving credit facility of $160.5 million and available capacity of $410.0 million, after consideration of $29.5 million of letters of credit backed by the facility. Aimco also held cash and restricted cash on hand of $430.3 million ($428.0 million Aimco share), which included approximately $290 million of 1031 exchange proceeds anticipated to be invested during the third quarter.
Finally, Aimco held properties in its unencumbered asset pool with an estimated fair market value of approximately $1.7 billion.
Dividend - As previously announced, the Aimco Board of Directors declared a quarterly cash dividend of $0.33 per share of Class A Common Stock for the quarter ended June 30, 2016. On an annualized basis, this represents an increase of 12% compared to the dividends paid during 2015. This dividend is payable on August 31, 2016, to stockholders of record on August 19, 2016.
2016 Outlook: Guidance Raised to Reflect Second Quarter Outperformance
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($ Amounts represent Aimco Share) | FULL YEAR 2016 | PREVIOUS FULL YEAR 2016 | FULL YEAR 2015 |
| | | |
Net Income per share | $1.75 to $1.83 | $0.41 to $0.51 | $1.52 |
Pro forma FFO per share | $2.26 to $2.34 | $2.24 to $2.34 | $2.23 |
AFFO per share | $1.94 to $2.02 | $1.92 to $2.02 | $1.88 |
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Conventional Same Store Operating Measures | | | |
Revenue change compared to prior year | 4.50% to 5.00% | 4.50% to 5.00% | 4.5% |
Expense change compared to prior year | 1.75% to 2.25% | 1.75% to 2.25% | 2.1% |
NOI change compared to prior year | 5.50% to 6.50% | 5.50% to 6.50% | 5.6% |
| | | |
Non-Core Earnings | | | |
Non-recurring investment management revenues | $5M | $1M to $3M | $1M |
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| |
($ Amounts represent Aimco Share) | THIRD QUARTER 2016 |
| |
Net income per share | $0.06 to $0.10 |
Pro forma FFO per share | $0.52 to $0.56 |
AFFO per share | $0.43 to $0.47 |
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Conventional Same Store Operating Measures | |
NOI change compared to second quarter 2016 | 1.25% to 2.25% |
NOI change compared to third quarter 2015 | 5.50% to 6.50% |
Earnings Conference Call Information
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Live Conference Call: | Conference Call Replay: |
Friday, July 29, 2016 at 1:00 p.m. ET | Replay available until 9:00 a.m. ET on October 29, 2016 |
Domestic Dial-In Number: 1-888-317-6003 | Domestic Dial-In Number: 1-877-344-7529 |
International Dial-In Number: 1-412-317-6061 | International Dial-In Number: 1-412-317-0088 |
Passcode: 5105563 | Passcode: 10088380 |
Live webcast and replay: http://www.aimco.com/investors |
Supplemental Information
The full text of this Earnings Release and the Supplemental Information referenced in this release are available on Aimco’s website at http://www.aimco.com/investors.
Glossary & Reconciliations of Non-GAAP Financial and Operating Measures
Financial and operating measures found in this Earnings Release and the Supplemental Information include certain financial measures used by Aimco management that are measures not defined under accounting principles generally accepted in the United States (“GAAP”). These measures are defined in the Glossary in the Supplemental Information and, where appropriate, reconciled to the most comparable GAAP measures.
About Aimco
Aimco is a real estate investment trust focused on the ownership and management of quality apartment communities located in selected markets in the United States. Aimco is one of the country’s largest owners and operators of apartments, with 192 communities in 22 states and the District of Columbia. Aimco common shares are traded on the New York Stock Exchange under the ticker symbol AIV, and are included in the S&P 500. For more information about Aimco, please visit our website at www.aimco.com.
Contact
Lynn Stanfield, Senior Vice President, Finance
Valerie Kimball, Director, Investor Relations
Investor Relations 303-793-4661, investor@aimco.com
Forward-looking Statements
This Earnings Release and Supplemental Information contain forward-looking statements within the meaning of the federal securities laws, including, without limitation, statements regarding projected results and specifically forecasts of: third quarter and full year 2016 results, including but not limited to: Pro forma FFO and selected components thereof; AFFO; Aimco redevelopment and development investments, timelines and Net Operating Income contribution; Aimco acquisition and lease-up timelines and Net Operating Income contribution; expectations regarding sales of Aimco apartment communities and the use of proceeds thereof; and Aimco liquidity and leverage metrics.
These forward-looking statements are based on management’s judgment as of this date, which is subject to risks and uncertainties. Risks and uncertainties include, but are not limited to: Aimco’s ability to maintain current or meet projected occupancy, rental rate and property operating results; the effect of acquisitions, dispositions, redevelopments and developments; Aimco’s ability to meet budgeted costs and timelines, and achieve budgeted rental rates related to Aimco developments and redevelopments; Aimco’s ability to meet timelines and budgeted rental rates related to Aimco lease-up properties; and Aimco’s ability to comply with debt covenants, including financial coverage ratios.
Actual results may differ materially from those described in these forward-looking statements and, in addition, will be affected by a variety of risks and factors, some of which are beyond the control of Aimco, including, without limitation: real estate risks, including fluctuations in real estate values and the general economic climate in the markets in which Aimco operates and competition for residents in such markets; national and local economic conditions, including the pace of job growth and the level of unemployment; the amount, location and quality of competitive new housing supply; financing risks, including the availability and cost of capital markets’ financing and the risk that Aimco’s cash flows from operations may be insufficient to meet required payments of principal and interest; the risk that Aimco’s earnings may not be sufficient to maintain compliance with debt covenants; the terms of governmental regulations that affect Aimco and interpretations of those regulations; the competitive environment in which Aimco operates; the timing of acquisitions, dispositions, redevelopments and developments; insurance risk, including the cost of insurance; natural disasters and severe weather such as hurricanes; litigation, including costs associated with prosecuting or defending claims and any adverse outcomes; energy costs; and possible environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of apartment communities presently or previously owned by Aimco. In addition, Aimco’s current and continuing qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code and depends on its ability to meet the various requirements imposed by the Internal Revenue Code, through actual operating results, distribution levels and diversity of stock ownership.
Readers should carefully review Aimco’s financial statements and the notes thereto, as well as the section entitled “Risk Factors” in Item 1A of Aimco’s Annual Report on Form 10-K for the year ended December 31, 2015, and the other documents Aimco files from time to time with the Securities and Exchange Commission.
These forward-looking statements reflect management’s judgment as of this date, and Aimco assumes no obligation to revise or update them to reflect future events or circumstances. This press release does not constitute an offer of securities for sale.
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Consolidated Statements of Operations | | | | | | | | |
(in thousands, except per share data) (unaudited) | | | | | | | | |
| | | | | | | | |
| | Three Months Ended | | Six Months Ended |
| | June 30, | | June 30, |
| | 2016 | | 2015 | | 2016 | | 2015 |
REVENUES | | | | | | | | |
Rental and other property revenues | | $ | 242,871 |
| | $ | 238,637 |
| | $ | 484,352 |
| | $ | 476,926 |
|
Tax credit and asset management revenues | | 8,347 |
| | 6,146 |
| | 13,105 |
| | 12,122 |
|
Total revenues | | 251,218 |
| | 244,783 |
| | 497,457 |
| | 489,048 |
|
| | | | | | | | |
OPERATING EXPENSES | | | | | | | | |
Property operating expenses | | 88,305 |
| | 87,930 |
| | 176,702 |
| | 183,422 |
|
Investment management expenses | | 1,017 |
| | 1,086 |
| | 1,992 |
| | 2,689 |
|
Depreciation and amortization | | 80,680 |
| | 75,150 |
| | 160,508 |
| | 149,582 |
|
General and administrative expenses | | 11,254 |
| | 12,062 |
| | 23,189 |
| | 22,714 |
|
Other expenses, net | | 5,526 |
| | 2,912 |
| | 7,096 |
| | 3,931 |
|
Total operating expenses | | 186,782 |
| | 179,140 |
|
| 369,487 |
| | 362,338 |
|
Operating income | | 64,436 |
| | 65,643 |
| | 127,970 |
| | 126,710 |
|
Interest income | | 1,843 |
| | 1,705 |
| | 3,678 |
| | 3,430 |
|
Interest expense | | (48,894 | ) | | (49,605 | ) | | (96,528 | ) | | (103,125 | ) |
Other, net | | 4,906 |
| | 350 |
| | 4,983 |
| | 2,614 |
|
Income before income taxes and gain on dispositions | | 22,291 |
| | 18,093 |
| | 40,103 |
| | 29,629 |
|
Income tax benefit | | 7,121 |
| | 5,814 |
| | 13,007 |
| | 12,735 |
|
Income before gain on dispositions | | 29,412 |
| | 23,907 |
| | 53,110 |
| | 42,364 |
|
Gain on dispositions of real estate, net of tax | | 216,541 |
| | 44,781 |
| | 222,728 |
| | 130,474 |
|
Net income | | 245,953 |
| | 68,688 |
| | 275,838 |
| | 172,838 |
|
Noncontrolling interests: | | | | | | | | |
Net income attributable to noncontrolling interests in consolidated real estate partnerships | | (8,677 | ) | | (111 | ) | | (9,607 | ) | | (4,867 | ) |
Net income attributable to preferred noncontrolling interests in Aimco OP | | (1,708 | ) | | (1,736 | ) | | (3,434 | ) | | (3,472 | ) |
Net income attributable to common noncontrolling interests in Aimco OP | | (11,135 | ) | | (2,972 | ) | | (12,307 | ) | | (7,370 | ) |
Net income attributable to noncontrolling interests | | (21,520 | ) | | (4,819 | ) | | (25,348 | ) | | (15,709 | ) |
Net income attributable to Aimco | | 224,433 |
| | 63,869 |
| | 250,490 |
| | 157,129 |
|
Net income attributable to Aimco preferred stockholders | | (2,758 | ) | | (2,758 | ) | | (5,515 | ) | | (6,280 | ) |
Net income attributable to participating securities | | (293 | ) | | (307 | ) | | (370 | ) | | (701 | ) |
Net income attributable to Aimco common stockholders | | $ | 221,382 |
| | $ | 60,804 |
| | $ | 244,605 |
| | $ | 150,148 |
|
| | | | | | | | |
Net income attributable to Aimco per common share – basic | | $ | 1.42 |
| | $ | 0.39 |
| | $ | 1.57 |
| | $ | 0.97 |
|
| | | | | | | | |
Net income attributable to Aimco per common share – diluted | | $ | 1.41 |
| | $ | 0.39 |
| | $ | 1.57 |
| | $ | 0.97 |
|
| | | | | | | | |
Weighted average common shares outstanding – basic | | 156,375 |
| | 155,524 |
| | 155,876 |
| | 154,672 |
|
Weighted average common shares outstanding – diluted | | 156,793 |
| | 155,954 |
| | 156,248 |
| | 155,115 |
|
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Consolidated Balance Sheets |
(in thousands) (unaudited) |
| | | | |
| | June 30, 2016 | | December 31, 2015 |
ASSETS | | | | |
Buildings and improvements | | $ | 6,283,998 |
| | $ | 6,446,326 |
|
Land | | 1,847,582 |
| | 1,861,157 |
|
Total real estate | | 8,131,580 |
| | 8,307,483 |
|
Accumulated depreciation | | (2,657,290 | ) | | (2,778,022 | ) |
Net real estate | | 5,474,290 |
| | 5,529,461 |
|
Cash and cash equivalents | | 55,225 |
| | 50,789 |
|
Restricted cash | | 375,092 |
| | 86,956 |
|
Other assets | | 360,669 |
| | 448,405 |
|
Assets held for sale | | 8,952 |
| | 3,070 |
|
Total assets | | $ | 6,274,228 |
| | $ | 6,118,681 |
|
| | | | |
LIABILITIES AND EQUITY | | | | |
Non-recourse property debt, net | | $ | 3,795,098 |
| | $ | 3,822,141 |
|
Revolving credit facility borrowings | | 160,540 |
| | 27,000 |
|
Total indebtedness | | 3,955,638 |
| | 3,849,141 |
|
Accounts payable | | 43,414 |
| | 36,123 |
|
Accrued liabilities and other | | 206,104 |
| | 317,481 |
|
Deferred income | | 57,819 |
| | 64,052 |
|
Liabilities related to assets held for sale | | 6,214 |
| | 53 |
|
Total liabilities | | 4,269,189 |
| | 4,266,850 |
|
Preferred noncontrolling interests in Aimco OP | | 86,198 |
| | 87,926 |
|
Equity: | | | | |
Perpetual Preferred Stock | | 159,126 |
| | 159,126 |
|
Class A Common Stock | | 1,566 |
| | 1,563 |
|
Additional paid-in capital | | 4,066,476 |
| | 4,064,659 |
|
Accumulated other comprehensive loss | | (710 | ) | | (6,040 | ) |
Distributions in excess of earnings | | (2,455,302 | ) | | (2,596,917 | ) |
Total Aimco equity | | 1,771,156 |
| | 1,622,391 |
|
Noncontrolling interests in consolidated real estate partnerships | | 150,257 |
| | 151,365 |
|
Common noncontrolling interests in Aimco OP | | (2,572 | ) | | (9,851 | ) |
Total equity | | 1,918,841 |
| | 1,763,905 |
|
Total liabilities and equity | | $ | 6,274,228 |
| | $ | 6,118,681 |
|
| | | | |
|
| | | | | | | | | | | | | | | | | |
Supplemental Schedule 1 | | | | | | | | | |
| | | | | | | | | |
Funds From Operations and Adjusted Funds From Operations | | | | | | | | |
(in thousands, except per share data) (unaudited) | | | | | | | | | |
| | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | |
| | 2016 | | 2015 | | 2016 | | 2015 | |
Net income attributable to Aimco common stockholders | | $ | 221,382 |
| | $ | 60,804 |
| | $ | 244,605 |
| | $ | 150,148 |
| |
Adjustments: | | | | | | | | | |
Depreciation and amortization, net of noncontrolling partners’ interest | | 78,934 |
| | 72,997 |
| | 156,912 |
| | 145,619 |
| |
Depreciation and amortization related to non-real estate assets, net of noncontrolling partners’ interest | | (2,734 | ) | | (2,610 | ) | | (5,416 | ) | | (5,098 | ) | |
Gain on dispositions and other, net of income taxes and noncontrolling partners’ interest | | (211,569 | ) | | (43,304 | ) | | (217,424 | ) | | (124,031 | ) | |
Provision for impairment losses related to depreciable real estate assets, including amounts related to unconsolidated entities and net of noncontrolling partners’ interest | | — |
| | 655 |
| | — |
| | 655 |
| |
Common noncontrolling interests in Aimco OP’s share of above adjustments | | 6,481 |
| | (1,348 | ) | | 3,154 |
| | (832 | ) | |
Amounts allocable to participating securities | | 154 |
| | (112 | ) | | 96 |
| | (71 | ) | |
FFO Attributable to Aimco common stockholders | | $ | 92,648 |
| | $ | 87,082 |
| | $ | 181,927 |
| | $ | 166,390 |
| |
Preferred equity redemption related amounts, net of common noncontrolling interests in Aimco OP and participating securities | | — |
| | — |
| | — |
| | 658 |
| |
Pro forma FFO Attributable to Aimco common stockholders | | $ | 92,648 |
| | $ | 87,082 |
| | $ | 181,927 |
| | $ | 167,048 |
| |
Capital Replacements, net of common noncontrolling interests in Aimco OP and participating securities | | (14,335 | ) | | (14,618 | ) | | (24,721 | ) | | (23,748 | ) | |
AFFO Attributable to Aimco common stockholders | | $ | 78,313 |
| | $ | 72,464 |
| | $ | 157,206 |
| | $ | 143,300 |
| |
| | | | | | | | | |
Weighted average common shares outstanding | | 156,375 |
| | 155,524 |
| | 155,876 |
| | 154,672 |
| |
Dilutive common share equivalents | | 418 |
| | 430 |
| | 372 |
| | 443 |
| |
Total shares and dilutive share equivalents | | 156,793 |
| | 155,954 |
| | 156,248 |
| | 155,115 |
| |
| | | | | | | | | |
FFO per share – diluted | | $ | 0.59 |
| | $ | 0.56 |
| | $ | 1.16 |
| | $ | 1.07 |
| |
Pro Forma FFO per share – diluted | | $ | 0.59 |
| | $ | 0.56 |
| | $ | 1.16 |
| | $ | 1.08 |
| |
AFFO per share – diluted | | $ | 0.50 |
| | $ | 0.46 |
| | $ | 1.01 |
| | $ | 0.92 |
| |
| |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 2(a) |
| | | | | | | | | | | | | | | |
Proportionate Adjusted Funds From Operations Presentation | | | | | | | |
Three Months Ended June 30, 2016 Compared to Three Months Ended June 30, 2015 |
(in thousands) (unaudited) |
| | Three Months Ended June 30, 2016 | | Three Months Ended June 30, 2015 |
| | Consolidated Amount | | Proportionate Share of Unconsolidated Partnerships | | Noncontrolling Interests | | Proportionate Amount | | Consolidated Amount | | Proportionate Share of Unconsolidated Partnerships | | Noncontrolling Interests | | Proportionate Amount |
Real estate operations: | | | | | | | | | | | | | | | | |
Rental and other property revenues | | | | | | | | | | | | | | | | |
Conventional Same Store | | $ | 173,400 |
| | $ | — |
| | $ | (4,711 | ) | | $ | 168,689 |
| | $ | 166,444 |
| | $ | — |
| | $ | (4,610 | ) | | $ | 161,834 |
|
Conventional Redevelopment and Development | | 25,444 |
| | — |
| | (2,321 | ) | | 23,123 |
| | 22,199 |
| | — |
| | (2,490 | ) | | 19,709 |
|
Conventional Acquisition | | 1,800 |
| | — |
| | — |
| | 1,800 |
| | 784 |
| | — |
| | — |
| | 784 |
|
Other Conventional | | 11,287 |
| | 546 |
| | — |
| | 11,833 |
| | 10,984 |
| | 536 |
| | — |
| | 11,520 |
|
Total Conventional | | 211,931 |
| | 546 |
| | (7,032 | ) | | 205,445 |
| | 200,411 |
| | 536 |
| | (7,100 | ) | | 193,847 |
|
Affordable | | 25,946 |
| | 1,016 |
| | (144 | ) | | 26,818 |
| | 23,678 |
| | 994 |
| | (139 | ) | | 24,533 |
|
Property management revenues, primarily from affiliates | | 2 |
| | (61 | ) | | 146 |
| | 87 |
| | 3 |
| | (60 | ) | | 145 |
| | 88 |
|
Total rental and other property revenues | | 237,879 |
| | 1,501 |
| | (7,030 | ) | | 232,350 |
| | 224,092 |
| | 1,470 |
| | (7,094 | ) | | 218,468 |
|
| | | | | | | | | | | | | | | | |
Property operating expenses | | | | | | | | | | | | | | | | |
Conventional Same Store | | 54,383 |
| | — |
| | (1,484 | ) | | 52,899 |
| | 52,039 |
| | — |
| | (1,484 | ) | | 50,555 |
|
Conventional Redevelopment and Development | | 8,798 |
| | — |
| | (748 | ) | | 8,050 |
| | 7,540 |
| | — |
| | (747 | ) | | 6,793 |
|
Conventional Acquisition | | 994 |
| | — |
| | — |
| | 994 |
| | 765 |
| | — |
| | — |
| | 765 |
|
Other Conventional | | 5,468 |
| | 217 |
| | — |
| | 5,685 |
| | 4,835 |
| | 194 |
| | — |
| | 5,029 |
|
Total Conventional | | 69,643 |
| | 217 |
| | (2,232 | ) | | 67,628 |
| | 65,179 |
| | 194 |
| | (2,231 | ) | | 63,142 |
|
Affordable | | 9,665 |
| | 467 |
| | (64 | ) | | 10,068 |
| | 8,890 |
| | 446 |
| | (62 | ) | | 9,274 |
|
Casualties | | 833 |
| | — |
| | (3 | ) | | 830 |
| | 1,535 |
| | — |
| | 8 |
| | 1,543 |
|
Property management expenses | | 5,941 |
| | — |
| | — |
| | 5,941 |
| | 6,101 |
| | — |
| | 5 |
| | 6,106 |
|
Total property operating expenses | | 86,082 |
| | 684 |
| | (2,299 | ) | | 84,467 |
| | 81,705 |
| | 640 |
| | (2,280 | ) | | 80,065 |
|
Net real estate operations | | 151,797 |
| | 817 |
| | (4,731 | ) | | 147,883 |
| | 142,387 |
| | 830 |
| | (4,814 | ) | | 138,403 |
|
| | | | | | | | | | | | | | | | |
Amortization of deferred tax credit income (noncash) | | 2,090 |
| | — |
| | — |
| | 2,090 |
| | 3,302 |
| | — |
| | — |
| | 3,302 |
|
Amortization of deferred tax credit income (cash) | | 2,646 |
| | — |
| | — |
| | 2,646 |
| | 2,810 |
| | — |
| | — |
| | 2,810 |
|
Non-recurring investment management revenues | | 3,611 |
| | — |
| | — |
| | 3,611 |
| | 34 |
| | — |
| | 200 |
| | 234 |
|
Total tax credit and asset management revenues | | 8,347 |
| | — |
| | — |
| | 8,347 |
| | 6,146 |
| | — |
| | 200 |
| | 6,346 |
|
| | | | | | | | | | | | | | | | |
Investment management expenses | | (1,017 | ) | | — |
| | — |
| | (1,017 | ) | | (1,086 | ) | | — |
| | — |
| | (1,086 | ) |
Depreciation and amortization related to non-real estate assets | | (2,733 | ) | | — |
| | 4 |
| | (2,729 | ) | | (2,596 | ) | | — |
| | 4 |
| | (2,592 | ) |
General and administrative expenses | | (11,254 | ) | | — |
| | — |
| | (11,254 | ) | | (12,062 | ) | | — |
| | — |
| | (12,062 | ) |
Other expenses, net | | (5,527 | ) | | 14 |
| | 11 |
| | (5,502 | ) | | (2,266 | ) | | (133 | ) | | 11 |
| | (2,388 | ) |
Interest income | | 1,859 |
| | 1 |
| | 8 |
| | 1,868 |
| | 1,706 |
| | — |
| | 7 |
| | 1,713 |
|
Interest expense | | (48,005 | ) | | (304 | ) | | 1,535 |
| | (46,774 | ) | | (46,297 | ) | | (316 | ) | | 1,646 |
| | (44,967 | ) |
Other, net of non-FFO items | | 2,105 |
| | 263 |
| | (981 | ) | | 1,387 |
| | 292 |
| | 394 |
| | 1,206 |
| | 1,892 |
|
Historic tax credit benefit | | 4,471 |
| | — |
| | — |
| | 4,471 |
| | 3,269 |
| | — |
| | — |
| | 3,269 |
|
Other tax benefits, net | | 3,365 |
| | — |
| | — |
| | 3,365 |
| | 3,550 |
| | — |
| | — |
| | 3,550 |
|
FFO related to Sold and Held For Sale Apartment Communities | | 1,863 |
| | — |
| | — |
| | 1,863 |
| | 4,350 |
| | — |
| | 10 |
| | 4,360 |
|
Preferred dividends and distributions | | (4,466 | ) | | — |
| | — |
| | (4,466 | ) | | (4,494 | ) | | — |
| | — |
| | (4,494 | ) |
Common noncontrolling interests in Aimco OP | | (4,655 | ) | | — |
| | — |
| | (4,655 | ) | | (4,443 | ) | | — |
| | — |
| | (4,443 | ) |
Amounts allocated to participating securities | | (139 | ) | | — |
| | — |
| | (139 | ) | | (419 | ) | | — |
| | — |
| | (419 | ) |
FFO | | $ | 96,011 |
| | $ | 791 |
| | $ | (4,154 | ) | | $ | 92,648 |
| | $ | 88,037 |
| | $ | 775 |
| | $ | (1,730 | ) | | $ | 87,082 |
|
Preferred equity redemption related amounts, net | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Pro forma FFO | | $ | 96,011 |
| | $ | 791 |
| | $ | (4,154 | ) | | $ | 92,648 |
| | $ | 88,037 |
| | $ | 775 |
| | $ | (1,730 | ) | | $ | 87,082 |
|
Capital Replacements | | (15,231 | ) | | — |
| | 896 |
| | (14,335 | ) | | (15,635 | ) | | — |
| | 1,017 |
| | (14,618 | ) |
AFFO | | $ | 80,780 |
| | $ | 791 |
| | $ | (3,258 | ) | | $ | 78,313 |
| | $ | 72,402 |
| | $ | 775 |
| | $ | (713 | ) | | $ | 72,464 |
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 2(b) |
| | | | | | | | | | | | | | | |
Proportionate Funds From Operations and Adjusted Funds From Operations Presentation | | | | | | | |
Six Months Ended June 30, 2016 Compared to Six Months Ended June 30, 2015 |
(in thousands) (unaudited) |
| | Six Months Ended June 30, 2016 | | Six Months Ended June 30, 2015 |
| | Consolidated Amount | | Proportionate Share of Unconsolidated Partnerships | | Noncontrolling Interests | | Proportionate Amount | | Consolidated Amount | | Proportionate Share of Unconsolidated Partnerships | | Noncontrolling Interests | | Proportionate Amount |
Real estate operations: | | | | | | | | | | | | | | | | |
Rental and other property revenues | | | | | | | | | | | | | | | | |
Conventional Same Store | | $ | 345,483 |
| | $ | — |
| | $ | (9,460 | ) | | $ | 336,023 |
| | $ | 330,674 |
| | $ | — |
| | $ | (9,145 | ) | | $ | 321,529 |
|
Conventional Redevelopment and Development | | 50,376 |
| | — |
| | (4,756 | ) | | 45,620 |
| | 43,205 |
| | — |
| | (4,931 | ) | | 38,274 |
|
Conventional Acquisition | | 3,542 |
| | — |
| | — |
| | 3,542 |
| | 906 |
| | — |
| | — |
| | 906 |
|
Other Conventional | | 22,040 |
| | 1,097 |
| | — |
| | 23,137 |
| | 21,200 |
| | 1,068 |
| | — |
| | 22,268 |
|
Total Conventional | | 421,441 |
| | 1,097 |
| | (14,216 | ) | | 408,322 |
| | 395,985 |
| | 1,068 |
| | (14,076 | ) | | 382,977 |
|
Affordable | | 50,308 |
| | 2,033 |
| | (288 | ) | | 52,053 |
| | 47,414 |
| | 2,000 |
| | (278 | ) | | 49,136 |
|
Property management revenues, primarily from affiliates | | 4 |
| | (121 | ) | | 293 |
| | 176 |
| | 4 |
| | (117 | ) | | 288 |
| | 175 |
|
Total rental and other property revenues | | 471,753 |
| | 3,009 |
| | (14,211 | ) | | 460,551 |
| | 443,403 |
| | 2,951 |
| | (14,066 | ) | | 432,288 |
|
| | | | | | | | | | | | | | | | |
Property operating expenses | | | | | | | | | | | | | | | | |
Conventional Same Store | | 107,997 |
| | — |
| | (3,054 | ) | | 104,943 |
| | 106,044 |
| | — |
| | (3,052 | ) | | 102,992 |
|
Conventional Redevelopment and Development | | 16,812 |
| | — |
| | (1,510 | ) | | 15,302 |
| | 15,505 |
| | — |
| | (1,541 | ) | | 13,964 |
|
Conventional Acquisition | | 1,923 |
| | — |
| | — |
| | 1,923 |
| | 795 |
| | — |
| | — |
| | 795 |
|
Other Conventional | | 10,642 |
| | 396 |
| | — |
| | 11,038 |
| | 9,753 |
| | 381 |
| | — |
| | 10,134 |
|
Total Conventional | | 137,374 |
| | 396 |
| | (4,564 | ) | | 133,206 |
| | 132,097 |
| | 381 |
| | (4,593 | ) | | 127,885 |
|
Affordable | | 19,592 |
| | 911 |
| | (130 | ) | | 20,373 |
| | 19,083 |
| | 880 |
| | (125 | ) | | 19,838 |
|
Casualties | | 2,983 |
| | — |
| | (28 | ) | | 2,955 |
| | 5,619 |
| | — |
| | (47 | ) | | 5,572 |
|
Property management expenses | | 11,841 |
| | — |
| | 1 |
| | 11,842 |
| | 12,106 |
| | — |
| | 8 |
| | 12,114 |
|
Total property operating expenses | | 171,790 |
| | 1,307 |
| | (4,721 | ) | | 168,376 |
| | 168,905 |
| | 1,261 |
| | (4,757 | ) | | 165,409 |
|
Net real estate operations | | 299,963 |
| | 1,702 |
| | (9,490 | ) | | 292,175 |
| | 274,498 |
| | 1,690 |
| | (9,309 | ) | | 266,879 |
|
| | | | | | | | | | | | | | | | |
Amortization of deferred tax credit income (noncash) | | 6,827 |
| | — |
| | — |
| | 6,827 |
| | 9,242 |
| | — |
| | — |
| | 9,242 |
|
Amortization of deferred tax credit income (cash) | | 2,646 |
| | — |
| | — |
| | 2,646 |
| | 2,810 |
| | — |
| | — |
| | 2,810 |
|
Non-recurring investment management revenues | | 3,632 |
| | — |
| | — |
| | 3,632 |
| | 70 |
| | — |
| | 473 |
| | 543 |
|
Total tax credit and asset management revenues | | 13,105 |
| | — |
| | — |
| | 13,105 |
| | 12,122 |
| | — |
| | 473 |
| | 12,595 |
|
| | | | | | | | | | | | | | | | |
Investment management expenses | | (1,992 | ) | | — |
| | — |
| | (1,992 | ) | | (2,689 | ) | | — |
| | — |
| | (2,689 | ) |
Depreciation and amortization related to non-real estate assets | | (5,412 | ) | | — |
| | 8 |
| | (5,404 | ) | | (5,069 | ) | | — |
| | 8 |
| | (5,061 | ) |
General and administrative expenses | | (23,189 | ) | | — |
| | — |
| | (23,189 | ) | | (22,714 | ) | | — |
| | — |
| | (22,714 | ) |
Other expenses, net | | (7,070 | ) | | (30 | ) | | 45 |
| | (7,055 | ) | | (3,188 | ) | | (171 | ) | | 35 |
| | (3,324 | ) |
Interest income | | 3,695 |
| | 1 |
| | 17 |
| | 3,713 |
| | 3,439 |
| | 1 |
| | 15 |
| | 3,455 |
|
Interest expense | | (93,675 | ) | | (619 | ) | | 3,072 |
| | (91,222 | ) | | (95,590 | ) | | (622 | ) | | 3,275 |
| | (92,937 | ) |
Other, net of non-FFO items | | 3,403 |
| | 661 |
| | (2,382 | ) | | 1,682 |
| | 227 |
| | 726 |
| | 2,784 |
| | 3,737 |
|
Historic tax credit benefit | | 6,902 |
| | — |
| | — |
| | 6,902 |
| | 6,684 |
| | — |
| | — |
| | 6,684 |
|
Other tax benefits, net | | 6,810 |
| | — |
| | — |
| | 6,810 |
| | 8,075 |
| | — |
| | — |
| | 8,075 |
|
FFO related to Sold and Held For Sale Apartment Communities | | 4,778 |
| | — |
| | — |
| | 4,778 |
| | 10,681 |
| | — |
| | 33 |
| | 10,714 |
|
Preferred dividends and distributions | | (8,949 | ) | | — |
| | — |
| | (8,949 | ) | | (9,752 | ) | | — |
| | — |
| | (9,752 | ) |
Common noncontrolling interests in Aimco OP | | (9,153 | ) | | — |
| | — |
| | (9,153 | ) | | (8,500 | ) | | — |
| | — |
| | (8,500 | ) |
Amounts allocated to participating securities | | (274 | ) | | — |
| | — |
| | (274 | ) | | (772 | ) | | — |
| | — |
| | (772 | ) |
FFO | | $ | 188,942 |
| | $ | 1,715 |
| | $ | (8,730 | ) | | $ | 181,927 |
| | $ | 167,452 |
| | $ | 1,624 |
| | $ | (2,686 | ) | | $ | 166,390 |
|
Preferred stock redemption related amounts | | — |
| | — |
| | — |
| | — |
| | 658 |
| | — |
| | — |
| | 658 |
|
Pro forma FFO | | $ | 188,942 |
| | $ | 1,715 |
| | $ | (8,730 | ) | | $ | 181,927 |
| | $ | 168,110 |
| | $ | 1,624 |
| | $ | (2,686 | ) | | $ | 167,048 |
|
Capital Replacements | | (26,322 | ) | | — |
| | 1,601 |
| | (24,721 | ) | | (25,571 | ) | | — |
| | 1,823 |
| | (23,748 | ) |
AFFO | | $ | 162,620 |
| | $ | 1,715 |
| | $ | (7,129 | ) | | $ | 157,206 |
| | $ | 142,539 |
| | $ | 1,624 |
| | $ | (863 | ) | | $ | 143,300 |
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 3 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Proportionate Property Net Operating Income | | | | | | | | | | | | | | | |
(in thousands) (unaudited) | | | | | | | | | | | | | | | | | |
As of June 30, 2016 | | | | | | | | | | | | | | | | | |
| | As of June 30, 2016 | | Three Months Ended | |
| | Number of Apartment Communities | | Number of Apartment Homes | | Average Economic Ownership | | June 30, 2016 | | March 31, 2016 | | December 31, 2015 | | September 30, 2015 | | June 30, 2015 | |
Rental and other property revenues | | | | | | | | | | | | | | | | | |
Conventional Same Store | | 108 |
| | 33,214 |
| | 98 | % | | $ | 168,689 |
| | $ | 167,334 |
| | $ | 164,702 |
| | $ | 163,937 |
| | $ | 161,834 |
| |
Conventional Redevelopment and Development | | 10 |
| | 3,806 |
| | 94 | % | | 23,123 |
| | 22,497 |
| | 22,182 |
| | 21,740 |
| | 19,709 |
| |
Conventional Acquisition | | 2 |
| | 209 |
| | 100 | % | | 1,800 |
| | 1,742 |
| | 1,640 |
| | 1,099 |
| | 784 |
| |
Other Conventional | | 17 |
| | 1,612 |
| | 96 | % | | 11,833 |
| | 11,304 |
| | 11,388 |
| | 11,984 |
| | 11,520 |
| |
Total Conventional | | 137 |
| | 38,841 |
| | 98 | % | | 205,445 |
| | 202,877 |
| | 199,912 |
| | 198,760 |
| | 193,847 |
| |
Affordable | | 55 |
| | 8,389 |
| | 95 | % | | 26,818 |
| | 25,235 |
| | 24,027 |
| | 24,757 |
| | 24,533 |
| |
Total rental and other property revenues | | 192 |
| | 47,230 |
| | 97 | % | | $ | 232,263 |
| | $ | 228,112 |
| | $ | 223,939 |
| | $ | 223,517 |
| | $ | 218,380 |
| |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Direct property operating expenses | | | | | | | | | | | | | | | | | |
Conventional Same Store | | | | | | | | $ | 52,899 |
| | $ | 52,043 |
| | $ | 50,373 |
| | $ | 52,744 |
| | $ | 50,555 |
| |
Conventional Redevelopment and Development | | | | | | | | 8,050 |
| | 7,252 |
| | 7,699 |
| | 7,618 |
| | 6,793 |
| |
Conventional Acquisition | | | | | | | | 994 |
| | 930 |
| | 731 |
| | 887 |
| | 765 |
| |
Other Conventional | | | | | | | | 5,685 |
| | 5,352 |
| | 5,382 |
| | 5,199 |
| | 5,029 |
| |
Total Conventional | | | | | | | | 67,628 |
| | 65,577 |
| | 64,185 |
| | 66,448 |
| | 63,142 |
| |
Affordable | | | | | | | | 10,068 |
| | 10,306 |
| | 9,833 |
| | 9,896 |
| | 9,274 |
| |
Total direct property operating expenses | | | | | | | | $ | 77,696 |
| | $ | 75,883 |
| | $ | 74,018 |
| | $ | 76,344 |
| | $ | 72,416 |
| |
| | | | | | | | | | | | | | | | | |
Property Net Operating Income | | | | | | | | | | | | | | | | | |
Conventional Same Store | | | | | | | | $ | 115,790 |
| | $ | 115,291 |
| | $ | 114,329 |
| | $ | 111,193 |
| | $ | 111,279 |
| |
Conventional Redevelopment and Development | | | | | | | | 15,073 |
| | 15,245 |
| | 14,483 |
| | 14,122 |
| | 12,916 |
| |
Conventional Acquisition | | | | | | | | 806 |
| | 812 |
| | 909 |
| | 212 |
| | 19 |
| |
Other Conventional | | | | | | | | 6,148 |
| | 5,952 |
| | 6,006 |
| | 6,785 |
| | 6,491 |
| |
Total Conventional | | | | | | | | 137,817 |
| | 137,300 |
| | 135,727 |
| | 132,312 |
| | 130,705 |
| |
Affordable | | | | | | | | 16,750 |
| | 14,929 |
| | 14,194 |
| | 14,861 |
| | 15,259 |
| |
Total Property Net Operating Income | | | | | | | | $ | 154,567 |
| | $ | 152,229 |
| | $ | 149,921 |
| | $ | 147,173 |
| | $ | 145,964 |
| |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | Three Months Ended | |
| | | | | | | | June 30, 2016 | | March 31, 2016 | | December 31, 2015 | | September 30, 2015 | | June 30, 2015 | |
Sold and Held for Sale Property Net Operating Income | | | | | | | | | | | | | | | | | |
Sold Apartment Communities | |
|
| |
|
| |
|
| | $ | 2,230 |
| | $ | 4,410 |
| | $ | 6,287 |
| | $ | 6,467 |
| | $ | 7,788 |
| |
Held for Sale Apartment Communities [1] | |
|
| |
|
| |
|
| | 539 |
| | 507 |
| | 542 |
| | 530 |
| | 530 |
| |
Total Sold and Held for Sale Property Net Operating Income | |
|
| |
|
| | $ | 2,769 |
| | $ | 4,917 |
| | $ | 6,829 |
| | $ | 6,997 |
| | $ | 8,318 |
| |
| | | | | | | | | | | | | | | | | |
[1] Held for Sale Apartment Communities includes one affordable community with 296 apartment homes. |
|
| | | | | | | | | | | | | | | | |
Supplemental Schedule 4 | | | | | | | | |
| | | | | | | | |
Proportionate Balance Sheet Data | | | | | | | | |
As of June 30, 2016 | | | | | | | | |
(in thousands)(unaudited) | | | | | | | | |
| | Consolidated GAAP Balance Sheet | | Proportionate Share of Unconsolidated Partnerships | | Noncontrolling Interests | | Proportionate Balance Sheet |
ASSETS | | | | | | | | |
Real estate | | $ | 8,131,580 |
| | $ | 51,183 |
| | $ | (248,451 | ) | | $ | 7,934,312 |
|
Accumulated depreciation | | (2,657,290 | ) | | (11,529 | ) | | 80,597 |
| | (2,588,222 | ) |
Net real estate | | 5,474,290 |
| | 39,654 |
| | (167,854 | ) | | 5,346,090 |
|
Cash and cash equivalents | | 55,225 |
| | 585 |
| | (2,743 | ) | | 53,067 |
|
Restricted cash | | 375,092 |
| | 1,565 |
| | (1,700 | ) | | 374,957 |
|
Investment in unconsolidated real estate partnerships | | 15,377 |
| | (15,377 | ) | | — |
| | — |
|
Goodwill | | 39,885 |
| | — |
| | — |
| | 39,885 |
|
Other assets | | 305,407 |
| | (2,387 | ) | | (33,252 | ) | | 269,768 |
|
Assets held for sale | | 8,952 |
| | — |
| | — |
| | 8,952 |
|
Total assets | | $ | 6,274,228 |
| | $ | 24,040 |
| | $ | (205,549 | ) | | $ | 6,092,719 |
|
| | | | | | | | |
LIABILITIES AND EQUITY | | | | | | | | |
Non-recourse property debt | | $ | 3,818,582 |
| | $ | 22,996 |
| | $ | (161,379 | ) | | $ | 3,680,199 |
|
Debt issue costs | | (23,484 | ) | | (198 | ) | | 336 |
| | (23,346 | ) |
Non-recourse property debt, net | | 3,795,098 |
| | 22,798 |
| | (161,043 | ) | | 3,656,853 |
|
Revolving credit facility borrowings | | 160,540 |
| | — |
| | — |
| | 160,540 |
|
Deferred income [1] | | 57,819 |
| | 17 |
| | (263 | ) | | 57,573 |
|
Other liabilities | | 249,518 |
| | 1,225 |
| | (44,363 | ) | | 206,380 |
|
Liabilities related to assets held for sale | | 6,214 |
| | — |
| | — |
| | 6,214 |
|
Total liabilities | | 4,269,189 |
| | 24,040 |
| | (205,669 | ) | | 4,087,560 |
|
Preferred noncontrolling interests in Aimco OP | | 86,198 |
| | — |
| | — |
| | 86,198 |
|
Perpetual preferred stock | | 159,126 |
| | — |
| | — |
| | 159,126 |
|
Other Aimco equity | | 1,612,030 |
| | — |
| | 150,377 |
| | 1,762,407 |
|
Noncontrolling interests in consolidated real estate partnerships | | 150,257 |
| | — |
| | (150,257 | ) | | — |
|
Common noncontrolling interests in Aimco OP | | (2,572 | ) | | — |
| | — |
| | (2,572 | ) |
Total liabilities and equity | | $ | 6,274,228 |
| | $ | 24,040 |
| | $ | (205,549 | ) | | $ | 6,092,719 |
|
|
| | | | | | | |
[1] | Deferred income primarily represents cash received by Aimco and other amounts required by GAAP to be recognized in earnings in future periods as Aimco performs certain responsibilities under tax credit agreements or as other events occur. |
|
| | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 5(a) | | | | | | | | | | | | |
| | | | | | | | | | | | |
Capitalization and Financial Metrics | | | | | | | | | | |
As of June 30, 2016 | | | | | | | | | | | | |
(dollars in thousands) (unaudited) | | | | | | | | | | |
| | | | | | | | | | | | |
Leverage Balances and Characteristics |
Debt | | Consolidated | | Proportionate Share of Unconsolidated Partnerships | | Noncontrolling Interests | | Proportionate Balances | | Weighted Average Maturity (Years) | | Weighted Average Stated Interest Rate |
Fixed rate loans payable | | $ | 3,663,765 |
| | $ | 22,996 |
| | $ | (161,379 | ) | | $ | 3,525,382 |
| | 7.5 |
| | 5.08 | % |
Floating rate tax-exempt bonds | | 84,276 |
| | — |
| | — |
| | 84,276 |
| | 3.3 |
| | 1.94 | % |
Fixed rate tax-exempt bonds | | 70,541 |
| | — |
| | — |
| | 70,541 |
| | 24.1 |
| | 4.69 | % |
Total non-recourse property debt | | $ | 3,818,582 |
| | $ | 22,996 |
| | $ | (161,379 | ) | | $ | 3,680,199 |
| [1] | 7.7 |
| | 5.00 | % |
Revolving credit facility borrowings | | 160,540 |
| | — |
| | — |
| | 160,540 |
| | 2.3 |
| | 2.17 | % |
Preferred securities | | 245,989 |
| | — |
| | — |
| | 245,989 |
| | 34.4 |
| [2] | 7.26 | % |
Total Leverage | | $ | 4,225,111 |
| | $ | 22,996 |
| | $ | (161,379 | ) | | $ | 4,086,728 |
| | 9.0 |
| | 5.03 | % |
Cash and restricted cash | | (430,317 | ) | | (2,150 | ) | | 4,443 |
| | (428,024 | ) | | | | |
Tax free exchange proceeds | | 289,677 |
| | — |
| | — |
| | 289,677 |
| [3] | | | |
Securitization trust assets | | (73,744 | ) | | — |
| | — |
| | (73,744 | ) | [4] | | | |
Property debt held for sale | | 5,549 |
| | — |
| | — |
| | 5,549 |
| | | | |
Net Leverage | | $ | 4,016,276 |
| | $ | 20,846 |
| | $ | (156,936 | ) | | $ | 3,880,186 |
| | | | |
|
| | | | | | | | | | | | | | | | | | | |
Aimco Share Non-Recourse Property Debt |
| | | Amortization | | Maturities | | Total | | Maturities as a Percent of Total Debt | | Average Rate on Maturing Debt |
2016 3Q | | $ | 19,169 |
| | $ | — |
| | $ | 19,169 |
| | — | % | | — | % |
2016 4Q | | 20,133 |
| | 229,555 |
| | 249,688 |
| | 6.41 | % | | 4.69 | % |
Total 2016 | | 39,302 |
| | 229,555 |
| | 268,857 |
| | 6.41 | % | | 4.69 | % |
| | | | | | | | | | | |
2017 1Q | | 19,492 |
| | 74,658 |
| | 94,150 |
| | 2.09 | % | | 5.30 | % |
2017 2Q | | 19,120 |
| | 33,323 |
| | 52,443 |
| | 0.93 | % | | 5.68 | % |
2017 3Q | | 19,335 |
| | 38,933 |
| | 58,268 |
| | 1.09 | % | | 5.94 | % |
2017 4Q | | 18,998 |
| | 178,938 |
| | 197,936 |
| | 5.00 | % | | 6.23 | % |
Total 2017 | | 76,945 |
| | 325,852 |
| | 402,797 |
| | 9.10 | % | | 5.92 | % |
| | | | | | | | | | | |
2018 | | 75,236 |
| | 155,412 |
| | 230,648 |
| | 4.34 | % | | 4.33 | % |
2019 | | 70,026 |
| | 517,303 |
| | 587,329 |
| | 14.45 | % | | 5.65 | % |
2020 | | 63,465 |
| | 303,687 |
| | 367,152 |
| | 8.48 | % | | 6.12 | % |
2021 | | 46,580 |
| | 582,779 |
| [5] | 629,359 |
| | 16.28 | % | | 5.50 | % |
2022 | | 34,494 |
| | 233,439 |
| | 267,933 |
| | 6.52 | % | | 4.77 | % |
2023 | | 19,613 |
| | 140,414 |
| | 160,027 |
| | 3.92 | % | | 5.16 | % |
2024 | | 16,135 |
| | 36,489 |
| | 52,624 |
| | 1.02 | % | | 4.12 | % |
2025 | | 14,596 |
| | 131,312 |
| | 145,908 |
| | 3.67 | % | | 3.69 | % |
2026 | | 11,362 |
| | 48,362 |
| | 59,724 |
| | 1.35 | % | | 3.58 | % |
Thereafter | | 328,183 |
| | 78,806 |
| | 406,989 |
| | 2.20 | % | | 2.76 | % |
| Total | | $ | 795,937 |
| | $ | 2,783,410 |
| | $ | 3,579,347 |
| | | | |
| Securitization trust assets | | | | 100,852 |
| [5] | | | |
| Aimco share non-recourse property debt | | $ | 3,680,199 |
| | | | |
| | | | | | | | | | | |
[1] | Represents the carrying amount of Aimco debt. At June 30, 2016, Aimco’s debt had a mark-to-market liability of $192.2 million at quarter end. Such mark-to-market has been computed by Aimco utilizing a Money-Weighted Average Interest Rate on Aimco’s fixed rate property debt of 4.66%, which rate takes into account the timing of amortization and maturities, and a market rate of 3.49%, which rate takes into account the duration of the property debt as well as its loan-to value and coverage. |
[2] | Aimco preferred securities are perpetual in nature; however, for illustrative purposes, Aimco has computed the weighted average maturity of its total leverage assuming a 30-day maturity on the Class Z Cumulative Preferred Stock, which Aimco will redeem on July 29, 2016, and a 40-year maturity on its other preferred securities. |
[3] | At June 30, 2016, restricted cash included $289.7 million of proceeds from the disposition of two apartment communities, which have been designated for reinvestment through a tax free exchange transaction anticipated for completion during the third quarter. These proceeds are excluded from Aimco’s calculation of net leverage and in Aimco’s Leverage Ratios presented in Supplemental Schedule 5(b). |
[4] | In 2011, $673.8 million of Aimco’s loans payable were securitized in a trust holding only these loans. Aimco purchased the subordinate positions in the trust that holds these loans for $51.5 million. The subordinate positions have a face value of $100.9 million and a carrying amount of $73.7 million, and are included in other assets on the Aimco Consolidated Balance Sheet at June 30, 2016. The carrying amount of these investments effectively reduces Aimco’s June 30, 2016 leverage. |
[5] | The securitized property loans mature in 2021, and will repay Aimco’s subordinate positions in the securitization trust, which reduces Aimco’s 2021 refunding requirements from $683.6 million to $582.8 million, or 16.3% of debt outstanding at June 30, 2016. |
|
| | | | | | | | | | | | |
Supplemental Schedule 5(b) | | | | | | | | |
| | | | | | | | |
As of June 30, 2016 | | | | | | | | |
Capitalization and Financial Metrics | | | | | | | | |
(share, unit and dollar amounts in thousands) (unaudited) | | | | | | |
| | | | | | | | |
Preferred Securities | | | | | | | | |
| | | | | | | | |
| | Shares/Units Outstanding as of June 30, 2016 | | Date First Available for Redemption by Aimco | | Coupon | | Amount |
Perpetual Preferred Stock: | | | | | | | | |
Class A | | 5,000 |
| | 5/17/2019 | | 6.875 | % | | $ | 125,000 |
|
Class Z [1] | | 1,392 |
| | 7/29/2016 | | 7.000 | % | | 34,791 |
|
Total perpetual preferred stock | | | | | | 6.902 | % | | 159,791 |
|
| | | | | | | | |
Preferred Partnership Units | | 3,209 |
| | | | 7.926 | % | | 86,198 |
|
Total preferred securities | | | | | | 7.261 | % | | $ | 245,989 |
|
| | | | | | | | |
[1] On June 28, 2016, Aimco called for the redemption of all outstanding shares of its Class Z Cumulative Preferred Stock on July 29, 2016.
|
| | | | | | | | | | |
Leverage Ratios | | | | | | | | | | |
| | | | Trailing Twelve Months Ended June 30, | | | | |
| | | | 2016 | | 2015 | | | | |
Debt to EBITDA | | 6.4x | | 6.5x | | | | |
Debt and Preferred Equity to EBITDA | | 6.8x | | 7.0x | | | | |
EBITDA to Interest | | 3.3x | | 2.9x | | | | |
EBITDA to Interest and Preferred Dividends | | 3.0x | | 2.6x | | | | |
| | | | | | | | | | |
|
Revolving Line of Credit Debt Coverage Covenants |
| | | | Amount | | Covenant | | | | |
Debt Service Coverage Ratio | | | | 2.07x | | 1.50x | | | | |
Fixed Charge Coverage Ratio | | | | 1.94x | | 1.40x | | | | |
| | | | | | | | | | |
Credit Ratings | | | | | | | | | | |
| | | | | | | | | | |
Standard and Poor’s | | Corporate Credit Rating | | BBB- (stable) | | | | |
Fitch Ratings | | Issuer Default Rating | | BBB- (stable) | | | | |
|
| | | |
Common Stock, Partnership Units and Equivalents |
| | |
| As of | |
| June 30, 2016 | |
Class A Common Stock outstanding | 156,242 |
| |
Participating unvested restricted stock | 234 |
| |
Dilutive options share equivalents and non-participating unvested restricted stock | 713 |
| |
Total shares and dilutive share equivalents | 157,189 |
| |
Common Partnership Units and equivalents | 7,798 |
| |
Total shares, units and dilutive share equivalents | 164,987 |
| |
| | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 6(a) |
|
Conventional Same Store Operating Results |
Second Quarter 2016 Compared to Second Quarter 2015 |
(in thousands, except community, home and per home data) (unaudited) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Revenue | | Expenses | | Net Operating Income | | | Net Operating Income Margin | | Average Daily Occupancy During Period | | Average Revenue per Effective Apartment Home |
| | Apartment Communities | Apartment Homes | Effective Apartment Homes | | 2Q 2016 | 2Q 2015 | Growth | | 2Q 2016 | 2Q 2015 | Growth | | 2Q 2016 | 2Q 2015 | Growth | | | 2Q 2016 | | 2Q 2016 | 2Q 2015 | | 2Q 2016 | 2Q 2015 |
Target Markets | | | | | | | | | | | | | | | | | | | | | | | | | |
Atlanta | | 7 | 1,403 |
| 1,389 |
| | $ | 5,618 |
| $ | 5,182 |
| 8.4 | % | | $ | 2,091 |
| $ | 2,094 |
| (0.1 | )% | | $ | 3,527 |
| $ | 3,088 |
| 14.2 | % | | | 62.8% | | 95.1% | 93.9% | | $ | 1,417 |
| $ | 1,324 |
|
Bay Area | | 6 | 1,202 |
| 1,202 |
| | 9,459 |
| 8,518 |
| 11.0 | % | | 2,366 |
| 2,160 |
| 9.5 | % | | 7,093 |
| 6,358 |
| 11.6 | % | | | 75.0% | | 95.7% | 96.6% | | 2,740 |
| 2,445 |
|
Boston | | 12 | 4,173 |
| 4,173 |
| | 19,147 |
| 18,036 |
| 6.2 | % | | 6,670 |
| 6,531 |
| 2.1 | % | | 12,477 |
| 11,505 |
| 8.4 | % | | | 65.2% | | 96.7% | 97.0% | | 1,581 |
| 1,485 |
|
Chicago | | 10 | 3,246 |
| 3,246 |
| | 15,491 |
| 15,092 |
| 2.6 | % | | 5,707 |
| 4,987 |
| 14.4 | % | | 9,784 |
| 10,105 |
| (3.2 | )% | | | 63.2% | | 96.3% | 96.6% | | 1,652 |
| 1,605 |
|
Denver | | 8 | 2,065 |
| 2,026 |
| | 9,148 |
| 8,379 |
| 9.2 | % | | 2,263 |
| 2,369 |
| (4.5 | )% | | 6,885 |
| 6,010 |
| 14.6 | % | | | 75.3% | | 95.6% | 96.2% | | 1,575 |
| 1,432 |
|
Greater DC | | 13 | 5,325 |
| 5,297 |
| | 23,962 |
| 23,448 |
| 2.2 | % | | 7,417 |
| 6,895 |
| 7.6 | % | | 16,545 |
| 16,553 |
| — | % | | | 69.0% | | 96.4% | 96.6% | | 1,565 |
| 1,527 |
|
Greater LA | | 12 | 3,801 |
| 3,395 |
| | 24,434 |
| 23,375 |
| 4.5 | % | | 6,189 |
| 5,924 |
| 4.5 | % | | 18,245 |
| 17,451 |
| 4.5 | % | | | 74.7% | | 95.1% | 96.4% | | 2,523 |
| 2,382 |
|
Miami | | 5 | 2,471 |
| 2,460 |
| | 16,220 |
| 16,198 |
| 0.1 | % | | 5,146 |
| 5,196 |
| (1.0 | )% | | 11,074 |
| 11,002 |
| 0.7 | % | | | 68.3% | | 94.8% | 95.7% | | 2,320 |
| 2,294 |
|
Greater New York | | 9 | 496 |
| 496 |
| | 4,350 |
| 4,141 |
| 5.0 | % | | 1,464 |
| 1,468 |
| (0.3 | )% | | 2,886 |
| 2,673 |
| 8.0 | % | | | 66.3% | | 95.6% | 96.3% | | 3,057 |
| 2,890 |
|
Philadelphia | | 4 | 2,042 |
| 1,963 |
| | 8,733 |
| 8,588 |
| 1.7 | % | | 2,969 |
| 2,766 |
| 7.3 | % | | 5,764 |
| 5,822 |
| (1.0 | )% | | | 66.0% | | 96.3% | 97.0% | | 1,540 |
| 1,504 |
|
San Diego | | 6 | 2,032 |
| 2,032 |
| | 10,491 |
| 9,871 |
| 6.3 | % | | 2,705 |
| 2,527 |
| 7.0 | % | | 7,786 |
| 7,344 |
| 6.0 | % | | | 74.2% | | 96.3% | 96.9% | | 1,787 |
| 1,672 |
|
Seattle | | 2 | 239 |
| 239 |
| | 1,502 |
| 1,357 |
| 10.7 | % | | 520 |
| 458 |
| 13.5 | % | | 982 |
| 899 |
| 9.2 | % | | | 65.4% | | 96.8% | 97.9% | | 2,165 |
| 1,934 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Total Target Markets | | 94 | 28,495 |
| 27,918 |
| | 148,555 |
| 142,185 |
| 4.5 | % | | 45,507 |
| 43,375 |
| 4.9 | % | | 103,048 |
| 98,810 |
| 4.3 | % | | | 69.4% | | 95.9% | 96.4% | | 1,849 |
| 1,760 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Other Markets | | | | | | | | | | | | | | | | | | | | | | | | | |
Baltimore | | 2 | 376 |
| 376 |
| | 1,527 |
| 1,561 |
| (2.2 | )% | | 577 |
| 594 |
| (2.9 | )% | | 950 |
| 967 |
| (1.8 | )% | | | 62.2% | | 92.0% | 93.3% | | 1,472 |
| 1,484 |
|
Nashville | | 3 | 764 |
| 764 |
| | 3,100 |
| 2,937 |
| 5.5 | % | | 971 |
| 962 |
| 0.9 | % | | 2,129 |
| 1,975 |
| 7.8 | % | | | 68.7% | | 94.3% | 96.1% | | 1,434 |
| 1,333 |
|
Norfolk - Richmond | | 5 | 1,487 |
| 1,408 |
| | 4,692 |
| 4,560 |
| 2.9 | % | | 1,613 |
| 1,494 |
| 8.0 | % | | 3,079 |
| 3,066 |
| 0.4 | % | | | 65.6% | | 96.5% | 96.0% | | 1,151 |
| 1,124 |
|
Other Markets | | 4 | 2,092 |
| 2,092 |
| | 10,627 |
| 10,406 |
| 2.1 | % | | 4,232 |
| 4,131 |
| 2.4 | % | | 6,395 |
| 6,275 |
| 1.9 | % | | | 60.2% | | 96.5% | 96.4% | | 1,755 |
| 1,719 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Total Other Markets | | 14 | 4,719 |
| 4,640 |
| | 19,946 |
| 19,464 |
| 2.5 | % | | 7,393 |
| 7,181 |
| 3.0 | % | | 12,553 |
| 12,283 |
| 2.2 | % | | | 62.9% | | 95.8% | 96.0% | | 1,496 |
| 1,457 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Grand Total | | 108 | 33,214 |
| 32,558 |
| | $ | 168,501 |
| $ | 161,649 |
| 4.2 | % | | $ | 52,900 |
| $ | 50,556 |
| 4.6 | % | | $ | 115,601 |
| $ | 111,093 |
| 4.1 | % | | | 68.6% | | 95.9% | 96.4% | | $ | 1,799 |
| $ | 1,717 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 6(b) |
|
Conventional Same Store Operating Results |
Second Quarter 2016 Compared to First Quarter 2016 |
(in thousands, except community, home and per home data) (unaudited) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Revenue | | Expenses | | Net Operating Income | | | Net Operating Income Margin | | Average Daily Occupancy During Period | | Average Revenue per Effective Apartment Home |
| | Apartment Communities | Apartment Homes | Effective Apartment Homes | | 2Q 2016 | 1Q 2016 | Growth | | 2Q 2016 | 1Q 2016 | Growth | | 2Q 2016 | 1Q 2016 | Growth | | | 2Q 2016 | | 2Q 2016 | 1Q 2016 | | 2Q 2016 | 1Q 2016 |
Target Markets | | | | | | | | | | | | | | | | | | | | | | | | | |
Atlanta | | 7 | 1,403 |
| 1,389 |
| | $ | 5,618 |
| $ | 5,458 |
| 2.9 | % | | $ | 2,091 |
| $ | 2,038 |
| 2.6 | % | | $ | 3,527 |
| $ | 3,420 |
| 3.1 | % | | | 62.8% | | 95.1% | 94.3% | | $ | 1,417 |
| $ | 1,388 |
|
Bay Area | | 6 | 1,202 |
| 1,202 |
| | 9,459 |
| 9,312 |
| 1.6 | % | | 2,366 |
| 2,333 |
| 1.4 | % | | 7,093 |
| 6,979 |
| 1.6 | % | | | 75.0% | | 95.7% | 96.3% | | 2,740 |
| 2,681 |
|
Boston | | 12 | 4,173 |
| 4,173 |
| | 19,147 |
| 18,922 |
| 1.2 | % | | 6,670 |
| 6,732 |
| (0.9 | )% | | 12,477 |
| 12,190 |
| 2.4 | % | | | 65.2% | | 96.7% | 96.8% | | 1,581 |
| 1,562 |
|
Chicago | | 10 | 3,246 |
| 3,246 |
| | 15,491 |
| 15,437 |
| 0.3 | % | | 5,707 |
| 5,100 |
| 11.9 | % | | 9,784 |
| 10,337 |
| (5.3 | )% | | | 63.2% | | 96.3% | 96.5% | | 1,652 |
| 1,642 |
|
Denver | | 8 | 2,065 |
| 2,026 |
| | 9,148 |
| 9,050 |
| 1.1 | % | | 2,263 |
| 2,304 |
| (1.8 | )% | | 6,885 |
| 6,746 |
| 2.1 | % | | | 75.3% | | 95.6% | 96.3% | | 1,575 |
| 1,546 |
|
Greater DC | | 13 | 5,325 |
| 5,297 |
| | 23,962 |
| 23,727 |
| 1.0 | % | | 7,417 |
| 7,346 |
| 1.0 | % | | 16,545 |
| 16,381 |
| 1.0 | % | | | 69.0% | | 96.4% | 95.8% | | 1,565 |
| 1,558 |
|
Greater LA | | 12 | 3,801 |
| 3,395 |
| | 24,434 |
| 24,709 |
| (1.1 | )% | | 6,189 |
| 6,318 |
| (2.0 | )% | | 18,245 |
| 18,391 |
| (0.8 | )% | | | 74.7% | | 95.1% | 96.3% | | 2,523 |
| 2,521 |
|
Miami | | 5 | 2,471 |
| 2,460 |
| | 16,220 |
| 16,326 |
| (0.6 | )% | | 5,146 |
| 5,377 |
| (4.3 | )% | | 11,074 |
| 10,949 |
| 1.1 | % | | | 68.3% | | 94.8% | 96.4% | | 2,320 |
| 2,295 |
|
Greater New York | | 9 | 496 |
| 496 |
| | 4,350 |
| 4,263 |
| 2.0 | % | | 1,464 |
| 1,454 |
| 0.7 | % | | 2,886 |
| 2,809 |
| 2.7 | % | | | 66.3% | | 95.6% | 94.7% | | 3,057 |
| 3,025 |
|
Philadelphia | | 4 | 2,042 |
| 1,963 |
| | 8,733 |
| 8,675 |
| 0.7 | % | | 2,969 |
| 3,036 |
| (2.2 | )% | | 5,764 |
| 5,639 |
| 2.2 | % | | | 66.0% | | 96.3% | 95.5% | | 1,540 |
| 1,542 |
|
San Diego | | 6 | 2,032 |
| 2,032 |
| | 10,491 |
| 10,287 |
| 2.0 | % | | 2,705 |
| 2,649 |
| 2.1 | % | | 7,786 |
| 7,638 |
| 1.9 | % | | | 74.2% | | 96.3% | 96.3% | | 1,787 |
| 1,752 |
|
Seattle | | 2 | 239 |
| 239 |
| | 1,502 |
| 1,429 |
| 5.1 | % | | 520 |
| 514 |
| 1.2 | % | | 982 |
| 915 |
| 7.3 | % | | | 65.4% | | 96.8% | 96.8% | | 2,165 |
| 2,059 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Total Target Markets | | 94 | 28,495 |
| 27,918 |
| | 148,555 |
| 147,595 |
| 0.7 | % | | 45,507 |
| 45,201 |
| 0.7 | % | | 103,048 |
| 102,394 |
| 0.6 | % | | | 69.4% | | 95.9% | 96.1% | | 1,849 |
| 1,833 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Other Markets | | | | | | | | | | | | | | | | | | | | | | | | | |
Baltimore | | 2 | 376 |
| 376 |
| | 1,527 |
| 1,510 |
| 1.1 | % | | 577 |
| 573 |
| 0.7 | % | | 950 |
| 937 |
| 1.4 | % | | | 62.2% | | 92.0% | 89.4% | | 1,472 |
| 1,497 |
|
Nashville | | 3 | 764 |
| 764 |
| | 3,100 |
| 3,038 |
| 2.0 | % | | 971 |
| 944 |
| 2.9 | % | | 2,129 |
| 2,094 |
| 1.7 | % | | | 68.7% | | 94.3% | 95.6% | | 1,434 |
| 1,387 |
|
Norfolk - Richmond | | 5 | 1,487 |
| 1,408 |
| | 4,692 |
| 4,595 |
| 2.1 | % | | 1,613 |
| 1,469 |
| 9.8 | % | | 3,079 |
| 3,126 |
| (1.5 | )% | | | 65.6% | | 96.5% | 96.1% | | 1,151 |
| 1,131 |
|
Other Markets | | 4 | 2,092 |
| 2,092 |
| | 10,627 |
| 10,407 |
| 2.1 | % | | 4,232 |
| 4,290 |
| (1.4 | )% | | 6,395 |
| 6,117 |
| 4.5 | % | | | 60.2% | | 96.5% | 95.9% | | 1,755 |
| 1,729 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Total Other Markets | | 14 | 4,719 |
| 4,640 |
| | 19,946 |
| 19,550 |
| 2.0 | % | | 7,393 |
| 7,276 |
| 1.6 | % | | 12,553 |
| 12,274 |
| 2.3 | % | | | 62.9% | | 95.8% | 95.4% | | 1,496 |
| 1,472 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Grand Total | | 108 | 33,214 |
| 32,558 |
| | $ | 168,501 |
| $ | 167,145 |
| 0.8 | % | | $ | 52,900 |
| $ | 52,477 |
| 0.8 | % | | $ | 115,601 |
| $ | 114,668 |
| 0.8 | % | | | 68.6% | | 95.9% | 96.0% | | $ | 1,799 |
| $ | 1,782 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 6(c) |
|
Conventional Same Store Operating Results |
Six Months Ended June 30, 2016 Compared to Six Months Ended June 30, 2015 |
(in thousands, except community, home and per home data) (unaudited) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Revenue | | Expenses | | Net Operating Income | | | Net Operating Income Margin | | Average Daily Occupancy During Period | | Average Revenue per Effective Apartment Home |
| | Apartment Communities | Apartment Homes | Effective Apartment Homes | | YTD 2Q 2016 | YTD 2Q 2015 | Growth | | YTD 2Q 2016 | YTD 2Q 2015 | Growth | | YTD 2Q 2016 | YTD 2Q 2015 | Growth | | | YTD 2Q 2016 | | YTD 2Q 2016 | YTD 2Q 2015 | | YTD 2Q 2016 | YTD 2Q 2015 |
Target Markets | | | | | | | | | | | | | | | | | | | | | | | | | |
Atlanta | | 7 | 1,403 |
| 1,389 |
| | $ | 11,076 |
| $ | 10,324 |
| 7.3 | % | | $ | 4,129 |
| $ | 4,063 |
| 1.6 | % | | $ | 6,947 |
| $ | 6,261 |
| 11.0 | % | | | 62.7% | | 94.7% | 93.6% | | $ | 1,403 |
| $ | 1,322 |
|
Bay Area | | 6 | 1,202 |
| 1,202 |
| | 18,772 |
| 16,743 |
| 12.1 | % | | 4,699 |
| 4,349 |
| 8.0 | % | | 14,073 |
| 12,394 |
| 13.5 | % | | | 75.0% | | 96.0% | 96.5% | | 2,710 |
| 2,405 |
|
Boston | | 12 | 4,173 |
| 4,173 |
| | 38,069 |
| 35,685 |
| 6.7 | % | | 13,402 |
| 13,365 |
| 0.3 | % | | 24,667 |
| 22,320 |
| 10.5 | % | | | 64.8% | | 96.7% | 96.9% | | 1,572 |
| 1,471 |
|
Chicago | | 10 | 3,246 |
| 3,246 |
| | 30,928 |
| 30,073 |
| 2.8 | % | | 10,807 |
| 10,300 |
| 4.9 | % | | 20,121 |
| 19,773 |
| 1.8 | % | | | 65.1% | | 96.4% | 96.5% | | 1,647 |
| 1,601 |
|
Denver | | 8 | 2,065 |
| 2,026 |
| | 18,198 |
| 16,560 |
| 9.9 | % | | 4,567 |
| 4,716 |
| (3.2 | )% | | 13,631 |
| 11,844 |
| 15.1 | % | | | 74.9% | | 95.9% | 96.3% | | 1,560 |
| 1,414 |
|
Greater DC | | 13 | 5,325 |
| 5,297 |
| | 47,689 |
| 46,613 |
| 2.3 | % | | 14,763 |
| 14,237 |
| 3.7 | % | | 32,926 |
| 32,376 |
| 1.7 | % | | | 69.0% | | 96.1% | 96.2% | | 1,562 |
| 1,524 |
|
Greater LA | | 12 | 3,801 |
| 3,395 |
| | 49,143 |
| 46,566 |
| 5.5 | % | | 12,507 |
| 12,110 |
| 3.3 | % | | 36,636 |
| 34,456 |
| 6.3 | % | | | 74.5% | | 95.7% | 96.1% | | 2,522 |
| 2,379 |
|
Miami | | 5 | 2,471 |
| 2,460 |
| | 32,546 |
| 32,362 |
| 0.6 | % | | 10,523 |
| 10,297 |
| 2.2 | % | | 22,023 |
| 22,065 |
| (0.2 | )% | | | 67.7% | | 95.6% | 96.4% | | 2,307 |
| 2,274 |
|
Greater New York | | 9 | 496 |
| 496 |
| | 8,613 |
| 8,301 |
| 3.8 | % | | 2,918 |
| 2,972 |
| (1.8 | )% | | 5,695 |
| 5,329 |
| 6.9 | % | | | 66.1% | | 95.2% | 97.3% | | 3,041 |
| 2,866 |
|
Philadelphia | | 4 | 2,042 |
| 1,963 |
| | 17,408 |
| 17,158 |
| 1.5 | % | | 6,005 |
| 6,117 |
| (1.8 | )% | | 11,403 |
| 11,041 |
| 3.3 | % | | | 65.5% | | 95.9% | 96.5% | | 1,541 |
| 1,509 |
|
San Diego | | 6 | 2,032 |
| 2,032 |
| | 20,778 |
| 19,475 |
| 6.7 | % | | 5,354 |
| 5,137 |
| 4.2 | % | | 15,424 |
| 14,338 |
| 7.6 | % | | | 74.2% | | 96.3% | 96.4% | | 1,770 |
| 1,657 |
|
Seattle | | 2 | 239 |
| 239 |
| | 2,931 |
| 2,647 |
| 10.7 | % | | 1,034 |
| 923 |
| 12.0 | % | | 1,897 |
| 1,724 |
| 10.0 | % | | | 64.7% | | 96.8% | 95.4% | | 2,112 |
| 1,934 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Total Target Markets | | 94 | 28,495 |
| 27,918 |
| | 296,151 |
| 282,507 |
| 4.8 | % | | 90,708 |
| 88,586 |
| 2.4 | % | | 205,443 |
| 193,921 |
| 5.9 | % | | | 69.4% | | 96.0% | 96.3% | | 1,841 |
| 1,752 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Other Markets | | | | | | | | | | | | | | | | | | | | | | | | | |
Baltimore | | 2 | 376 |
| 376 |
| | 3,037 |
| 3,075 |
| (1.2 | )% | | 1,150 |
| 1,155 |
| (0.4 | )% | | 1,887 |
| 1,920 |
| (1.7 | )% | | | 62.1% | | 90.7% | 92.6% | | 1,485 |
| 1,472 |
|
Nashville | | 3 | 764 |
| 764 |
| | 6,138 |
| 5,805 |
| 5.7 | % | | 1,915 |
| 1,939 |
| (1.2 | )% | | 4,223 |
| 3,866 |
| 9.2 | % | | | 68.8% | | 94.9% | 96.0% | | 1,410 |
| 1,319 |
|
Norfolk - Richmond | | 5 | 1,487 |
| 1,408 |
| | 9,287 |
| 9,113 |
| 1.9 | % | | 3,082 |
| 2,995 |
| 2.9 | % | | 6,205 |
| 6,118 |
| 1.4 | % | | | 66.8% | | 96.3% | 95.7% | | 1,141 |
| 1,127 |
|
Other Markets | | 4 | 2,092 |
| 2,092 |
| | 21,034 |
| 20,671 |
| 1.8 | % | | 8,523 |
| 8,316 |
| 2.5 | % | | 12,511 |
| 12,355 |
| 1.3 | % | | | 59.5% | | 96.2% | 95.7% | | 1,742 |
| 1,720 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Total Other Markets | | 14 | 4,719 |
| 4,640 |
| | 39,496 |
| 38,664 |
| 2.2 | % | | 14,670 |
| 14,405 |
| 1.8 | % | | 24,826 |
| 24,259 |
| 2.3 | % | | | 62.9% | | 95.6% | 95.5% | | 1,484 |
| 1,454 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Grand Total | | 108 | 33,214 |
| 32,558 |
| | $ | 335,647 |
| $ | 321,171 |
| 4.5 | % | | $ | 105,378 |
| $ | 102,991 |
| 2.3 | % | | $ | 230,269 |
| $ | 218,180 |
| 5.5 | % | | | 68.6% | | 96.0% | 96.2% | | $ | 1,790 |
| $ | 1,709 |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | |
Supplemental Schedule 6(d) | | | | | | | |
| | | | | | | |
Conventional Same Store Operating Expense Detail |
(in thousands) (unaudited) | | | | | | | |
| | | | | | | |
Quarterly Comparison |
| | | | | | | |
| | 2Q 2016 | % of Total | | 2Q 2015 | $ Change | % Change |
Real estate taxes | | $ | 16,562 |
| 31.3 | % | | $ | 15,525 |
| $ | 1,037 |
| 6.7 | % |
Utilities | | 9,718 |
| 18.4 | % | | 9,894 |
| (176 | ) | (1.8 | )% |
Onsite payroll | | 9,888 |
| 18.7 | % | | 9,425 |
| 463 |
| 4.9 | % |
Repairs and maintenance | | 7,104 |
| 13.4 | % | | 7,062 |
| 42 |
| 0.6 | % |
Software, technology and other | | 3,815 |
| 7.2 | % | | 3,511 |
| 304 |
| 8.7 | % |
Insurance | | 2,141 |
| 4.0 | % | | 1,612 |
| 529 |
| 32.8 | % |
Marketing | | 1,660 |
| 3.1 | % | | 1,713 |
| (53 | ) | (3.1 | )% |
Expensed turnover costs | | 2,012 |
| 3.9 | % | | 1,814 |
| 198 |
| 10.9 | % |
Total | | $ | 52,900 |
| 100.0 | % | | $ | 50,556 |
| $ | 2,344 |
| 4.6 | % |
| | | | | | | |
Sequential Comparison |
| | | | | | | |
| | 2Q 2016 | % of Total | | 1Q 2016 | $ Change | % Change |
Real estate taxes | | $ | 16,562 |
| 31.3 | % | | $ | 16,357 |
| $ | 205 |
| 1.3 | % |
Utilities | | 9,718 |
| 18.4 | % | | 10,316 |
| (598 | ) | (5.8 | )% |
Onsite payroll | | 9,888 |
| 18.7 | % | | 10,167 |
| (279 | ) | (2.7 | )% |
Repairs and maintenance | | 7,104 |
| 13.4 | % | | 6,757 |
| 347 |
| 5.1 | % |
Software, technology and other | | 3,815 |
| 7.2 | % | | 3,587 |
| 228 |
| 6.4 | % |
Insurance | | 2,141 |
| 4.0 | % | | 1,944 |
| 197 |
| 10.1 | % |
Marketing | | 1,660 |
| 3.1 | % | | 1,892 |
| (232 | ) | (12.3 | )% |
Expensed turnover costs | | 2,012 |
| 3.9 | % | | 1,457 |
| 555 |
| 38.1 | % |
Total | | $ | 52,900 |
| 100.0 | % | | $ | 52,477 |
| $ | 423 |
| 0.8 | % |
| | | | | | | |
Full Year Comparison |
| | | | | | | |
| | YTD 2Q 2016 | % of Total | | YTD 2Q 2015 | $ Change | % Change |
Real estate taxes | | $ | 32,919 |
| 31.2 | % | | $ | 31,468 |
| $ | 1,451 |
| 4.6 | % |
Utilities | | 20,034 |
| 19.0 | % | | 21,018 |
| (984 | ) | (4.7 | )% |
Onsite payroll | | 20,055 |
| 19.0 | % | | 19,206 |
| 849 |
| 4.4 | % |
Repairs and maintenance | | 13,861 |
| 13.2 | % | | 13,635 |
| 226 |
| 1.7 | % |
Software, technology and other | | 7,403 |
| 7.0 | % | | 6,926 |
| 477 |
| 6.9 | % |
Insurance | | 4,084 |
| 3.9 | % | | 3,996 |
| 88 |
| 2.2 | % |
Marketing | | 3,552 |
| 3.4 | % | | 3,471 |
| 81 |
| 2.3 | % |
Expensed turnover costs | | 3,470 |
| 3.3 | % | | 3,271 |
| 199 |
| 6.1 | % |
Total | | $ | 105,378 |
| 100.0 | % | | $ | 102,991 |
| $ | 2,387 |
| 2.3 | % |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 7(a) | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Conventional Portfolio Data by Market |
Second Quarter 2016 Compared to Second Quarter 2015 |
(unaudited) | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| | Quarter Ended June 30, 2016 | | Quarter Ended June 30, 2015 |
| | Apartment Communities | | Apartment Homes | | Effective Apartment Homes | | % Aimco NOI | | Average Revenue per Effective Apartment Home | | Apartment Communities | | Apartment Homes | | Effective Apartment Homes | | % Aimco NOI | | Average Revenue per Effective Apartment Home |
Target Markets | | | | | | | | | | | | | | | | | | | | |
Atlanta | | 8 |
| | 1,497 |
| | 1,483 |
| | 2.9 | % | | $ | 1,509 |
| | 8 |
| | 1,497 |
| | 1,483 |
| | 2.4 | % | | $ | 1,409 |
|
Bay Area | | 11 |
| | 2,169 |
| | 2,169 |
| | 8.1 | % | | 2,800 |
| | 11 |
| | 2,169 |
| | 2,169 |
| | 7.8 | % | | 2,425 |
|
Boston | | 15 |
| | 4,689 |
| | 4,689 |
| | 9.4 | % | | 1,639 |
| | 15 |
| | 4,689 |
| | 4,689 |
| | 8.3 | % | | 1,485 |
|
Chicago | | 10 |
| | 3,246 |
| | 3,246 |
| | 7.1 | % | | 1,652 |
| | 10 |
| | 3,246 |
| | 3,246 |
| | 7.4 | % | | 1,605 |
|
Denver | | 8 |
| | 2,065 |
| | 2,026 |
| | 5.0 | % | | 1,575 |
| | 8 |
| | 2,065 |
| | 2,026 |
| | 4.4 | % | | 1,432 |
|
Greater DC | | 13 |
| | 5,325 |
| | 5,297 |
| | 12.0 | % | | 1,565 |
| | 14 |
| | 6,547 |
| | 6,519 |
| | 14.7 | % | | 1,522 |
|
Greater LA | | 15 |
| | 5,313 |
| | 4,662 |
| | 19.4 | % | | 2,635 |
| | 15 |
| | 5,313 |
| | 4,662 |
| | 18.0 | % | | 2,464 |
|
Miami | | 5 |
| | 2,592 |
| | 2,581 |
| | 8.1 | % | | 2,277 |
| | 5 |
| | 2,561 |
| | 2,550 |
| | 8.1 | % | | 2,272 |
|
Greater New York | | 18 |
| | 1,040 |
| | 1,040 |
| | 4.4 | % | | 3,268 |
| | 18 |
| | 1,040 |
| | 1,040 |
| | 4.2 | % | | 3,161 |
|
Philadelphia | | 6 |
| | 3,524 |
| | 3,445 |
| | 6.8 | % | | 1,772 |
| | 6 |
| | 3,532 |
| | 3,453 |
| | 6.8 | % | | 1,658 |
|
San Diego | | 12 |
| | 2,423 |
| | 2,353 |
| | 7.0 | % | | 1,796 |
| | 12 |
| | 2,423 |
| | 2,353 |
| | 6.2 | % | | 1,618 |
|
Seattle | | 2 |
| | 239 |
| | 239 |
| | 0.7 | % | | 2,165 |
| | 2 |
| | 239 |
| | 239 |
| | 0.7 | % | | 1,934 |
|
| | | | | | | | | | | | | | | | | | | | |
Total Target Markets | | 123 |
| | 34,122 |
| | 33,230 |
| | 90.9 | % | | 1,965 |
| | 124 |
| | 35,321 |
| | 34,429 |
| | 89.0 | % | | 1,831 |
|
| | | | | | | | | | | | | | | | | | | | |
Other Markets | | | | | | | | | | | | | | | | | | | | |
Baltimore | | 2 |
| | 376 |
| | 376 |
| | 0.7 | % | | 1,472 |
| | 4 |
| | 797 |
| | 797 |
| | 1.4 | % | | 1,437 |
|
Nashville | | 3 |
| | 764 |
| | 764 |
| | 1.5 | % | | 1,434 |
| | 3 |
| | 764 |
| | 764 |
| | 1.4 | % | | 1,330 |
|
Norfolk - Richmond | | 5 |
| | 1,487 |
| | 1,408 |
| | 2.2 | % | | 1,151 |
| | 5 |
| | 1,487 |
| | 1,408 |
| | 2.2 | % | | 1,124 |
|
Other Markets | | 4 |
| | 2,092 |
| | 2,092 |
| | 4.7 | % | | 1,644 |
| | 7 |
| | 3,056 |
| | 3,056 |
| | 6.0 | % | | 1,459 |
|
| | | | | | | | | | | | | | | | | | | | |
Total Other Markets | | 14 |
| | 4,719 |
| | 4,640 |
| | 9.1 | % | | 1,446 |
| | 19 |
| | 6,104 |
| | 6,025 |
| | 11.0 | % | | 1,361 |
|
| | | | | | | | | | | | | | | | | | | | |
Grand Total | | 137 |
| | 38,841 |
| | 37,870 |
| | 100.0 | % | | $ | 1,900 |
| | 143 |
| | 41,425 |
| | 40,454 |
| | 100.0 | % | | $ | 1,759 |
|
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 7(b) | |
| |
Conventional Portfolio Data by Market | |
First Quarter 2016 Market Information | |
(unaudited) | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
Aimco portfolio strategy seeks predictable rent growth from a portfolio of apartment communities that is diversified across “A,” “B” and “C+” price points, averaging “B/B+” in quality and that is also diversified across large coastal and job growth markets in the U.S. Please refer to the Glossary for a description of Aimco’s Portfolio Quality Ratings. The schedule below illustrates Aimco Conventional Apartment Community portfolio quality based on 1Q 2016 data, the most recent period for which third-party data is available. Aimco adjusts the portfolio data to remove apartment communities sold through the current quarter, if any.
The average age of Aimco’s portfolio, adjusted for its sizable investment in redevelopment, is approximately 27 years. Please see the Glossary for further information. |
| | | | | | | | | | | | | | | | |
| | Quarter Ended March 31, 2016 | |
| | Apartment Communities | | Apartment Homes | | Effective Apartment Homes | | % Aimco NOI | | Average Rent per Effective Apartment Home [1] | | Market Rent [2] | | Percentage of Market Rent Average | | Average Age of Apartment Communities |
Target Markets | | | | | | | | | | | | | | | | |
Atlanta | | 8 |
| | 1,497 |
| | 1,483 |
| | 2.7 | % | | $ | 1,338 |
| | $ | 920 |
| | 145.4 | % | | 16 |
|
Bay Area | | 11 |
| | 2,169 |
| | 2,169 |
| | 8.7 | % | | 2,488 |
| | 2,224 |
| | 111.9 | % | | 21 |
|
Boston | | 15 |
| | 4,689 |
| | 4,689 |
| | 9.3 | % | | 1,482 |
| | 2,025 |
| | 73.2 | % | | 28 |
|
Chicago | | 10 |
| | 3,246 |
| | 3,246 |
| | 7.6 | % | | 1,438 |
| | 1,169 |
| | 123.0 | % | | 21 |
|
Denver | | 8 |
| | 2,065 |
| | 2,026 |
| | 5.3 | % | | 1,372 |
| | 1,065 |
| | 128.8 | % | | 21 |
|
Greater DC | | 13 |
| | 5,325 |
| | 5,297 |
| | 12.0 | % | | 1,413 |
| | 1,598 |
| | 88.4 | % | | 47 |
|
Greater LA | | 15 |
| | 5,313 |
| | 4,662 |
| | 19.4 | % | | 2,430 |
| | 1,610 |
| | 150.9 | % | | 10 |
|
Miami | | 5 |
| | 2,579 |
| | 2,568 |
| | 8.1 | % | | 2,007 |
| | 1,248 |
| | 160.8 | % | | 23 |
|
Greater New York | | 18 |
| | 1,040 |
| | 1,040 |
| | 4.2 | % | | 3,094 |
| | 2,975 |
| | 104.0 | % | | 85 |
|
Philadelphia | | 6 |
| | 3,525 |
| | 3,446 |
| | 6.6 | % | | 1,505 |
| | 1,168 |
| | 128.9 | % | | 38 |
|
San Diego | | 12 |
| | 2,423 |
| | 2,353 |
| | 6.6 | % | | 1,594 |
| | 1,549 |
| | 102.9 | % | | 25 |
|
Seattle | | 2 |
| | 239 |
| | 239 |
| | 0.7 | % | | 1,801 |
| | 1,337 |
| | 134.7 | % | | 2 |
|
| | | | | | | | | | | | | | | | |
Total Target Markets | | 123 |
| | 34,110 |
| | 33,218 |
| | 91.2 | % | | 1,761 |
| | 1,559 |
| | 113.0 | % | | 27 |
|
| | | | | | | | | | | | | | | | |
Other Markets | | | | | | | | | | | | | | | | |
Baltimore | | 2 |
| | 376 |
| | 376 |
| | 0.7 | % | | 1,353 |
| | 1,145 |
| | 118.2 | % | | 36 |
|
Nashville | | 3 |
| | 764 |
| | 764 |
| | 1.5 | % | | 1,200 |
| | 880 |
| | 136.4 | % | | 23 |
|
Norfolk - Richmond | | 5 |
| | 1,487 |
| | 1,408 |
| | 2.3 | % | | 974 |
| | 934 |
| | 104.3 | % | | 26 |
|
Other Markets | | 4 |
| | 2,092 |
| | 2,092 |
| | 4.3 | % | | 1,412 |
| | 1,256 |
| | 112.4 | % | | 42 |
|
| | | | | | | | | | | | | | | | |
Total Other Markets | | 14 |
| | 4,719 |
| | 4,640 |
| | 8.8 | % | | 1,239 |
| | 1,087 |
| | 114.0 | % | | 35 |
|
| | | | | | | | | | | | | | | | |
Grand Total | | 137 |
| | 38,829 |
| | 37,858 |
| | 100.0 | % | | $ | 1,696 |
| | $ | 1,500 |
| | 113.1 | % | | 27 |
|
| | | | | | | | | | | | | | | | |
[1] Represents rents, after concessions and vacancy loss, divided by Effective Apartment Home. Does not include other rental income. |
[2] 1Q 2016 per REIS | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 8 |
|
Apartment Community Disposition and Acquisition Activity |
(dollars in millions, except average revenue per home) (unaudited) |
| | | | | | | | | | | | | | | | | | |
Second Quarter 2016 Dispositions |
| | | | | | | | | | | | | | | | | | |
| | Apartment Communities | | Number of Homes | | Weighted Average Ownership | | Gross Proceeds | | NOI Cap Rate [1] | | Free Cash Flow Cap Rate [1] | | Property Debt | | Net Sales Proceeds [2] | | Average Revenue per Home |
Conventional | | 2 |
| | 1,547 |
| | 100% | | $ | 291.9 |
| | 5.3 | % | | 4.7 | % | | $ | — |
| | $ | 289.4 |
| | $ | 1,528 |
|
Affordable | | — |
| | — |
| | — | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total Dispositions | | 2 |
| | 1,547 |
| | 100% | | $ | 291.9 |
| | 5.3 | % | | 4.7 | % | | $ | — |
| | $ | 289.4 |
| | $ | 1,528 |
|
| | | | | | | | | | | | | | | | | | |
Year-to-Date 2016 Dispositions |
| | | | | | | | | | | | | | | | | | |
| | Apartment Communities | | Number of Homes | | Weighted Average Ownership | | Gross Proceeds | | NOI Cap Rate [1] | | Free Cash Flow Cap Rate [1] | | Property Debt | | Net Sales Proceeds [2] | | Average Revenue per Home |
Conventional | | 3 |
| | 1,643 |
| | 100% | | $ | 301.9 |
| | 5.4 | % | | 4.8 | % | | $ | — |
| | $ | 299.0 |
| | $ | 1,505 |
|
Affordable | | — |
| | — |
| | — | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total Dispositions | | 3 |
| | 1,643 |
| | 100% | | $ | 301.9 |
| | 5.4 | % | | 4.8 | % | | $ | — |
| | $ | 299.0 |
| | $ | 1,505 |
|
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
[1] Please refer to the Glossary for definitions of NOI Cap Rate and Free Cash Flow Cap Rate. The Conventional apartment communities sold were located in Baltimore, MD, which is a non-target market, and |
in Alexandria, VA, and had average revenue per apartment home significantly below that of Aimco’s retained portfolio. Accordingly, the NOI Cap Rate and Free Cash Flow Cap Rate for the Conventional |
apartment communities sold during 2016 are not indicative of those for Aimco’s retained portfolio. |
[2] Net Sales Proceeds are after repayment of debt, if any, net working capital settlements, payment of transaction costs and debt prepayment penalties, if applicable. |
|
Year-to-Date 2016 Acquisitions |
|
Aimco did not acquire any apartment communities during the first or second quarter of 2016. |
| | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 9 | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Capital Additions | | | | | | | | | | | | | |
(in thousands, except per apartment home data) (unaudited) | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Aimco classifies capital additions as Capital Replacements (“CR”), Capital Improvements (“CI”), Property Upgrades, Redevelopment, Development or Casualty. Recurring capital additions are apportioned between CR and CI based on the useful life of the item under consideration and the period over which Aimco has owned the item. Under this method of classification, CR represents the portion of the item consumed during Aimco’s ownership of the item, while CI represents capital additions that are made to enhance the value, profitability or useful life of an asset from its original purchase condition. Please see the Glossary for further descriptions. | |
| | | | | | | | | | | | | |
| | Three Months Ended June 30, 2016 | | Six Months Ended June 30, 2016 | |
| | Conventional | | Affordable | | Total | | Conventional | | Affordable | | Total | |
Capital Additions | | | | | | | | | | | | | |
Capital Replacements | | | | | | | | | | | | | |
Buildings and grounds | | $ | 8,392 |
| | $ | 1,358 |
| | $ | 9,750 |
| | $ | 14,217 |
| | $ | 2,302 |
| | $ | 16,519 |
| |
Turnover capital additions | | 1,787 |
| | 255 |
| | 2,042 |
| | 1,904 |
| | 497 |
| | 2,401 |
| |
Capitalized site payroll and indirect costs | | 828 |
| | 21 |
| | 849 |
| | 1,723 |
| | 50 |
| | 1,773 |
| |
Capital Replacements | | 11,007 |
| | 1,634 |
| | 12,641 |
| | 17,844 |
| | 2,849 |
| | 20,693 |
| |
Capital Improvements | | 3,480 |
| | 346 |
| | 3,826 |
| | 6,166 |
| | 890 |
| | 7,056 |
| |
Property Upgrades | | 20,930 |
| | — |
| | 20,930 |
| | 32,235 |
| | — |
| | 32,235 |
| |
Redevelopment [1] | | 43,104 |
| | — |
| | 43,104 |
| | 74,082 |
| | — |
| | 74,082 |
| |
Development | | 13,458 |
| | — |
| | 13,458 |
| | 29,073 |
| | — |
| | 29,073 |
| |
Casualty | | 1,504 |
| | 177 |
| | 1,681 |
| | 3,095 |
| | 548 |
| | 3,643 |
| |
Total Capital Additions [2] | | $ | 93,483 |
| | $ | 2,157 |
| | $ | 95,640 |
| | $ | 162,495 |
| | $ | 4,287 |
| | $ | 166,782 |
| |
| | | | | | | | | | | | | |
Total apartment homes | | 38,841 |
| | 8,389 |
| | 47,230 |
| | 38,841 |
| | 8,389 |
| | 47,230 |
| |
Capital Replacements per apartment home | | $ | 283 |
| | $ | 195 |
| | $ | 268 |
| | $ | 459 |
| | $ | 340 |
| | $ | 438 |
| |
|
| | | | | |
[1] | Redevelopment spending includes Aimco’s investment in ongoing larger projects that meet the definition of Conventional Redevelopment and Development Apartment Communities described in the Glossary, and for which additional information is provided on Supplemental Schedule 10. Redevelopment spending also includes Aimco’s investment in apartment communities in its redevelopment pipeline that do not currently meet the definition of Conventional Redevelopment and Development Apartment Communities or for which the net investment is not expected to exceed $10 million, which are not included in Supplemental Schedule 10. |
[2] | For the three and six months ended June 30, 2016, Total Capital Additions include $2.4 million and of $5.7 million of capitalized interest costs, respectively. |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Supplemental Schedule 10 | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Redevelopment and Development Portfolio | | | | (Page 1 of 4) | | |
As of June 30, 2016 | | | | | | | |
(unaudited) | | | | | | | | | | | | | | | |
| | |
| | | Total Apartment Homes | | Estimated / Actual Net Investment (millions) | | Inception-to-Date Net Investment (millions) | | Projected Net Operating Income Yield on Incremental Investment at Stabilization | | | | | | Average Revenue per Apartment Home Redeveloped or Constructed | | | |
| Location | | | | | | Stabilized Occupancy | | NOI Stabilization |
| Prior to Investment | | Stabilized | | Incremental Commercial Revenue (millions) | |
Under Redevelopment or Development | | | | | | | | | | | | | | | | | | | | |
Palazzo at Park La Brea | Los Angeles, CA | | 521 |
| | $ | 24.5 |
| | $ | 1.3 |
| | | | 2Q 2018 | | 3Q 2019 | | $ | 3,259 |
| | $ | 3,750 |
| | $ | — |
| |
Park Towne Place | Philadelphia, PA | | 948 |
| | 138.4 |
| | 93.8 |
| | | | 1Q 2018 | | 2Q 2019 | | 1,689 |
| | 2,640 |
| | 0.2 |
| |
The Sterling | Philadelphia, PA | | 534 |
| | 73.0 |
| | 53.3 |
| | | | 3Q 2017 | | 4Q 2018 | | 2,015 |
| | 2,685 |
| | 1.2 |
| |
| | | | | | | | | | | | | | | | | | | | |
In Lease-up | | | | | | | | | | | | | | | | | | | | |
One Canal | Boston, MA | | 310 |
| | 195.0 |
| | 191.4 |
| | | | 3Q 2017 | | 4Q 2018 | | n/a |
| | 3,800 |
| | 1.1 |
| |
Vivo | Cambridge, MA | | 91 |
| | 44.1 |
| | 44.1 |
| | | | 3Q 2016 | | 4Q 2017 | | n/a |
| | 2,750 |
| | 0.4 |
| |
| | | | | | | | | | | | | | | | | | | | |
Total / Weighted Average | | | 2,404 |
| | $ | 475.0 |
| | $ | 383.9 |
| | 6.0 | % | | | | | | | | | |
|
| |
| | | | | | | | | | | | | | | | | | | | |
| |
| | | | | | | | | | | | | | | | | | | | |
Summary of Redevelopment and Development Activity - In Active Construction or Lease-up | | | | | | | |
As of June 30, 2016 | | | | | | | |
(unaudited) | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Number of Apartment Homes | | Percentage of Completed Homes | | | | | | | | | | | | | |
| Approved for Redevelopment / To Be Constructed | | Completed | | Leased | | Occupied | |
| | | |
| |
| |
| |
| |
In Active Construction | | | | | | | | | | | | | | | | | | | | |
Palazzo at Park La Brea | 389 |
| | 24 |
| | 92 | % | | 92 | % | | | | | | | | | | | | | |
Park Towne Place | 701 |
| | 356 |
| | 73 | % | | 69 | % | | | | | | | | | | | | | |
The Sterling | 534 |
| | 343 |
| | 88 | % | | 86 | % | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
In Lease-up | | | | | | | | | | | | | | | | | | | | |
One Canal | 310 |
| | 310 |
| | 35 | % | | 24 | % | | | | | | | | | | | | | |
Vivo | 91 |
| | 91 |
| | 95 | % | | 90 | % | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
See the following pages for Terms and Definitions and a Summary of Redevelopment Projects. | |
| | | | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | |
Supplemental Schedule 10 (Continued) | | | | | | | | | | | | | | |
Redevelopment and Development Portfolio | | | | | | | | (Page 2 of 4) |
| | | |
Terms and Definitions | | | |
Estimated Net Investment - represents total estimated investment, net of tax and other credits earned by Aimco as a direct result of its redevelopment or development of the community. Total estimated investment includes all capitalized costs projected to be incurred to redevelop or develop the respective community, as determined in accordance with GAAP. |
Projected Net Operating Income Yield on Incremental Investment at Stabilization - for redevelopment projects, this represents projected stabilized incremental net operating income as a percentage of the Estimated Net Investment. Projected incremental net operating income for redevelopment projects includes the estimated stabilized rate increase that is expected to be achieved, and the estimated expense savings resulting from the redevelopment. For development projects, this represents projected stabilized net operating income as a percentage of the Estimated Net Investment. |
Stabilized Occupancy - period in which Aimco expects to achieve stabilized occupancy (greater than 90%). |
NOI Stabilization - period in which Aimco expects to achieve stabilized rents and operating costs, generally five quarters after Stabilized Occupancy. |
Average Revenue per Apartment Home Redeveloped or Constructed - represents the actual revenues per apartment home, which includes rents and other rental income, prior to redevelopment, and the projected revenues per apartment home following redevelopment or construction. Projections of stabilized revenues per apartment home are based on management’s judgment at the start of a redevelopment or development project and take into consideration factors including but not limited to: then current rent and other rental income expectations; then current market rents; and revenue achievement to date. |
|
| |
Supplemental Schedule 10 (Continued) | |
| |
Redevelopment and Development Portfolio | (Page 3 of 4) |
|
| |
Community | Project Summary |
The Palazzo at Park La Brea Los Angeles, CA
| The Palazzo at Park La Brea is a 521 apartment home community located in the Mid-Wilshire district of Los Angeles. It is directly across from The Grove, a popular retail and entertainment complex. The community also has easy access to Beverly Hills, Hollywood, Century City, Downtown Los Angeles and Santa Monica. Aimco began the phased redevelopment of The Palazzo at Park La Brea in 2012. Aimco completed enhancements of the fitness center and spa in 2013, including modern interior finishes, top-of-the-line fitness equipment, and a cardio balcony overlooking the pool. In 2014, Aimco completed the upgrade of 77 fourth floor penthouse units featuring open concept floor plans, luxury finishes, and exclusive access to a new roof top deck amenity. The current phase of the Palazzo at Park La Brea project includes the renovation of 389 apartment homes on the first three floors, or 75% of the homes in the community. The redevelopment also includes enhancements to the corridors on these floors. Full construction started in June 2016 and is expected to be completed in first quarter 2018. The Palazzo at Park La Brea is owned through a joint venture in which Aimco has an approximate 53% interest. Aimco’s share of the estimated investment in the project is $13 million. As Aimco evaluates the success of the project and other investment alternatives, Aimco may redevelop the remaining 55 penthouse homes. |
Park Towne Place Philadelphia, PA | The Park Towne Place community is a nine-acre site containing 948 apartment homes within four high-rise towers. It boasts a 20,000 square foot amenity center and two levels of below grade parking. It is located in the Benjamin Franklin Parkway, in the heart of Center City Philadelphia’s Museum District. The first phase included redevelopment of the commercial space, common areas and amenities, and the 229 apartment homes in the South Tower. At June 30, 2016, Aimco had completed the redevelopment of 224 apartment homes in the South Tower, and the South Tower reached the occupancy milestone of greater than 90% average daily occupancy in May. Aimco has also completed construction of the retail market and tenants are in the process of occupying the space. The second phase, which includes redevelopment of the 245 apartment home East Tower, was approved during the third quarter 2015. As of June 30, 2016, Aimco has completed redevelopment of 10 of the 19 floors, or 132 homes. Leasing of the redeveloped apartment homes in the East Tower has commenced on schedule at rates in line with underwriting. Based on the success of the lease-up of the first two towers, Aimco decided to proceed with redevelopment of the North Tower in June 2016. This tower contains 227 apartment homes. The redevelopment is similar to the South and East Towers, including original art work in the lobby and art themed corridors. The estimated $138.4 million net investment of the approved phases, represents a gross investment of $170.4 million, reduced by $32 million of historic tax credits. As Aimco continues to evaluate the success of the project and other investment alternatives, Aimco may redevelop additional apartment homes at the property. The entire cost to redevelop all apartment homes in the community could be $170 to $180 million, reflecting a gross investment of $210 to $220 million reduced by $40 to $42 million of historic tax credits. |
|
| |
Supplemental Schedule 10 (Continued) | |
| |
Redevelopment and Development Portfolio | (Page 4 of 4) |
|
| |
The Sterling Philadelphia, PA
| The Sterling is a 29-story, mixed use building with 534 apartment homes, three floors of commercial space and over 20,000 square feet of ground-level retail. The building is in the Market West neighborhood within five blocks of Rittenhouse Square and City Hall and within one block of Comcast Center and Comcast’s Innovation and Technology Center. The Sterling redevelopment includes significant renovation of existing commercial space, upgrading common areas and amenities, and the phased redevelopment of apartment homes. Aimco completed the renovation of the common areas, amenities and the ground-level retail space in 2015, at a cost consistent with underwriting. Based on the success of the earlier phases in redevelopment of The Sterling, during the second quarter, Aimco decided to proceed with the final phase, which includes redevelopment of the final seven residential floors, consisting of 125 apartment homes, as well as the continued redevelopment of commercial and retail space and completion of the streetscape. The estimated gross investment for this final phase is $22.3 million. Aimco’s gross investment now exceeds the qualified spending threshold to earn historic tax credits for the project and Aimco has now included the tax credits in estimated net investment and inception-to-date net investment. The estimated net investment for the complete project is $73 million, reflecting a gross investment of $84.8 million, reduced by $11.8 million of historic tax credits. At June 30, 2016, 343 of the 534 apartment homes in the community were complete, on schedule and at a cost consistent with underwriting. The apartment homes are leasing at rates ahead of underwriting. |
One Canal Apartment Homes Boston, MA | One Canal is a 12-story building is in the historic Bulfinch Triangle neighborhood of Boston’s West End. Located near the Boston Garden, one block from North Station and adjacent to the historic North End, the site enjoys excellent access to public transit, the Government Center, Financial District, and Massachusetts General Hospital employment centers, as well as the dining, recreation, and shopping amenities of its urban core location. The building includes 310 apartment homes and 21,000 square feet of commercial space. Construction on One Canal was substantially completed during second quarter. The investment in One Canal has been funded in part by a $114.0 million non-recourse property loan. Finishing touches on the construction are in progress. At June 30, 2016, 35% of the apartment homes were leased and rental rates are ahead of underwriting. 100% of the commercial space at One Canal has been leased by a single retail tenant who is in the process of obtaining required permits. |
Vivo Apartment Homes Cambridge, MA | Vivo Apartment Homes is an eight-story, 91-apartment home community near Kendall Square in Cambridge, Massachusetts. Vivo is in a location contiguous to a large life science complex. Construction of Vivo Apartment Homes was completed in the third quarter 2015. Lease up of the property finished two months ahead of schedule at rates 2% above underwriting. |
GLOSSARY AND RECONCILIATIONS OF NON-GAAP FINANCIAL AND OPERATING MEASURES
This Earnings Release and Supplemental Information include certain financial and operating measures used by Aimco management that are not calculated in accordance with accounting principles generally accepted in the United States, or GAAP. Aimco’s definitions and calculations of these non-GAAP financial and operating measures and other terms may differ from the definitions and methodologies used by other REITs and, accordingly, may not be comparable. These non-GAAP financial and operating measures should not be considered an alternative to GAAP net income or any other GAAP measurement of performance and should not be considered an alternative measure of liquidity.
ACQUISITION APARTMENT COMMUNITIES: Apartment Communities acquired since January 1, 2015.
AFFORDABLE APARTMENT COMMUNITIES: Affordable Apartment Communities benefit from governmental programs intended to provide housing to people with low or moderate incomes. These programs, which are usually administered by the U.S. Department of Housing and Urban Development (HUD) or state housing finance agencies, typically provide mortgage insurance, favorable financing terms, tax credits, or rental assistance payments to the owners of the communities. Under these programs, rent adjustments are made in accordance with property-specific contracts between Aimco and HUD, with rent increases generally based on an adjustment factor set by HUD annually.
AIMCO OP: AIMCO Properties, L.P., a Delaware limited partnership, is the operating partnership in Aimco’s UPREIT structure. Aimco owns approximately 95% of the common partnership units of the Aimco OP.
AIMCO PROPORTIONATE FINANCIAL INFORMATION: Non-GAAP measures representing Aimco’s share of financial information discussed in this Earnings Release and Supplemental Information. Aimco’s proportionate share of financial information includes Aimco’s share of unconsolidated real estate partnerships and excludes noncontrolling interests in consolidated real estate partnerships. Proportionate reporting benefits the users of Aimco’s financial information by providing the amount of revenues, expenses, assets and liabilities attributable to Aimco stockholders. Aimco also refers to this measure as “Aimco Share” of financial information. See Supplemental Schedules 2, 3, 4 and 5 for reconciliation of Aimco’s proportionate share of financial information to Aimco’s consolidated financial statements.
AVERAGE AGE OF APARTMENT COMMUNITIES: Calculated by Aimco on a property-by-property basis based on the year the community was originally built, adjusted for redevelopment and/or other major capital improvements that effectively reduce the age of the community. Such investments include construction of new buildings and/or amenities, replacement or modernization of mechanical, plumbing and electrical systems, and other investments that are consequential in nature. Portfolio average age is calculated on the basis of investment dollars. Market and portfolio Average Age of Apartment Communities is calculated on the basis of investment value.
CAPITAL ADDITIONS DEFINITIONS
CAPITAL IMPROVEMENTS (CI): CI includes all non-Redevelopment capital additions that are made to enhance the value, profitability or useful life of an asset from its original purchase condition.
CAPITAL REPLACEMENTS (CR): Unlike CI, CR does not increase the useful life of an asset from its original purchase condition. CR represents the portion of capital additions that are deemed to replace the consumed portion of acquired capital assets. CR is deducted in the calculation of AFFO.
CASUALTY CAPITAL ADDITIONS: Casualty capital additions represent capitalized costs incurred in connection with the restoration of an asset after a casualty event such as a hurricane, tornado, flood or fire.
PROPERTY UPGRADES: Property Upgrades may include kitchen and bath remodeling; energy conservation projects; and investments in longer-lived materials designed to reduce turnover costs, such as simulated wood flooring and granite countertops. Property Upgrades differ from Redevelopment Additions in that they are generally lesser in scope and do not significantly disrupt property operations.
REDEVELOPMENT ADDITIONS: Redevelopment additions represent capital additions intended to enhance the value of the apartment community through the ability to generate higher average rental rates. Redevelopment additions may include costs related to entitlement, which enhance the value of a community through increased density, and costs related to renovation of exteriors, common areas or apartment homes.
DEVELOPMENT ADDITIONS: Development additions represent construction and related capitalized costs associated with ground-up development projects.
CONVENTIONAL APARTMENT COMMUNITIES: Conventional Apartment Communities represent Aimco’s portfolio of market-rate apartment communities.
CONVENTIONAL REDEVELOPMENT AND DEVELOPMENT APARTMENT COMMUNITIES: Communities currently under construction that are not occupancy stabilized and those that have been completed in recent years that had not achieved and maintained stabilized occupancy for both the current and the comparable prior periods.
CONVENTIONAL SAME STORE APARTMENT COMMUNITIES: Same Store apartment communities are Conventional apartment communities that (a) are owned and managed by Aimco, (b) had reached a stabilized level of occupancy as of January 1, 2015 and maintained it throughout the current and the comparable prior periods, and (c) are not expected to be sold within 12 months.
DEFERRED TAX CREDIT INCOME: Deferred income includes $19.7 million of unamortized cash contributions previously received by Aimco in exchange for the allocation of tax credits and related tax benefits to investors in tax credit arrangements. These cash contributions are deferred upon receipt and amortized into earnings in future periods as Aimco delivers the tax credits and related benefits to the investors. Under existing tax credit agreements, Aimco will also receive additional semi-annual cash contributions totaling $17.7 million, of which $2.6 million will be received during the remainder of 2016 and $5.1 million will be received on average each year from 2017 through 2019.
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| | | | | | | |
| (in thousands) (unaudited) | | |
| | | | | June 30, 2016 |
| Deferred tax credit income balance | | $ | 19,681 |
|
| Cash contributions to be received in the future | | 17,683 |
|
| Total to be amortized | | $ | 37,364 |
|
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| | | | | | | | | | | | | |
| | | Revenue | | Expense | | Projected Income |
| 2016 3Q - 4Q | | $ | 9,473 |
| | $ | (634 | ) | | $ | 8,839 |
|
| 2017 | | 14,918 |
| | (1,034 | ) | | 13,884 |
|
| 2018 | | 7,010 |
| | (545 | ) | | 6,465 |
|
| 2019 | | 4,309 |
| | (399 | ) | | 3,910 |
|
| 2020 | | 2,880 |
| | (319 | ) | | 2,561 |
|
| Thereafter | | 4,365 |
| | (2,660 | ) | | 1,705 |
|
| Total | | $ | 42,955 |
| | $ | (5,591 | ) | | $ | 37,364 |
|
ECONOMIC OWNERSHIP: Represents Aimco’s share of the income or loss generated by an apartment community in which Aimco does not own all the equity interests. Economic ownership may differ from legal ownership due to terms of partnership agreements with profit and loss allocations that differ from stated ownership percentages.
EFFECTIVE APARTMENT HOMES: The number of actual apartment homes multiplied by Aimco’s ownership interest in the apartment community as of the end of the current period. Effective Apartment Homes may be used to analyze Aimco’s proportionate financial measures on a per-home basis.
FUNDS FROM OPERATIONS (FFO): FFO is a commonly used measure of REIT performance, which the National Association of Real Estate Investment Trusts (NAREIT) defines as net income, computed in accordance with GAAP, excluding gains from sales of, and impairment losses recognized with respect to, depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Aimco computes FFO for all periods presented in accordance with the guidance set forth by NAREIT.
In addition to FFO, Aimco uses PRO FORMA FUNDS FROM OPERATIONS (Pro forma FFO) and ADJUSTED FUNDS FROM OPERATIONS (AFFO) to measure performance. Pro forma FFO represents FFO as defined above, excluding preferred equity redemption related amounts (adjusted for noncontrolling interests). Preferred equity redemption related amounts (gains or losses) are items that periodically affect Aimco’s operating results. Aimco excludes preferred equity redemption related amounts (gains or losses) from Pro forma FFO because such amounts are not representative of operating performance.
AFFO represents Pro forma FFO reduced by Capital Replacements (also adjusted for noncontrolling interests) and is Aimco’s primary measure of current period profitability.
FFO, Pro forma FFO and AFFO are non-GAAP measures that Aimco believes are helpful to investors in understanding Aimco’s performance because they capture features particular to real estate performance by recognizing that real estate generally appreciates over time or maintains residual value to a much greater extent than other capital assets such as machinery, computers or other personal property. FFO, Pro forma FFO and AFFO should not be considered alternatives to net income (loss) or net cash flows from operating activities, as determined in accordance with GAAP, as indicators of performance or as measures of liquidity. There can be no assurance that Aimco’s method of computing FFO, Pro forma FFO or AFFO is comparable with that of other real estate investment trusts.
The following table reconciles GAAP net income per share to Pro forma FFO per share and AFFO per share, each as presented at the mid-point of Aimco’s updated 2016 guidance:
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| | | | | | | |
(dollars per share) (unaudited) | Third Quarter | | Full Year |
| 2016 | | 2016 |
Net income | $ | 0.08 |
| | $ | 1.79 |
|
Depreciation, net | 0.46 |
| | 1.90 |
|
Gain on disposition of real estate, net of tax | — |
| | (1.39 | ) |
Pro forma FFO | 0.54 |
| | 2.30 |
|
Capital Replacements, net | (0.09 | ) | | (0.32 | ) |
AFFO | $ | 0.45 |
| | $ | 1.98 |
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FREE CASH FLOW CAP RATE: Free Cash Flow Cap Rate represents the NOI cap rate, adjusted for assumed Capital Replacements spending of $1,200 per apartment home.
LEVERAGE RATIO DEFINITIONS
Aimco’s leverage strategy targets the ratio of Debt and Preferred Equity to Adjusted EBITDA to be below 7.0x and the ratio of Adjusted EBITDA to Adjusted Interest and Preferred Dividends to be greater than 2.5x. Aimco also focuses on the ratios of Debt to Adjusted EBITDA and Adjusted EBITDA Coverage of Interest. Aimco believes these ratios, which are based in part on non-GAAP financial information, are commonly used by investors and analysts to assess the relative financial risk associated with balance sheets of companies within the same industry, and they are believed to be similar to measures used by rating agencies to assess entity credit quality.
ADJUSTED INTEREST EXPENSE: Adjusted Interest Expense represents Aimco’s proportionate share of interest expense less (i) prepayment penalties and amortization of debt issuance costs and (ii) the amount of interest income recognized by Aimco related to its investment in the subordinated tranches in a securitization trust holding primarily Aimco property debt. Adjusted Interest Expense, as used in the leverage ratios on Supplemental Schedule 5(b), is calculated as follows:
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(in thousands) (unaudited) | Trailing Twelve Months Ended |
| June 30, |
| 2016 | | 2015 |
Interest expense computed in accordance with GAAP | $ | 193,088 |
| | $ | 213,288 |
|
Adjustments: | | | |
Adjustments related to interest of consolidated and unconsolidated partnerships | (4,911 | ) | | (5,874 | ) |
Debt prepayment penalties and other non-interest items | (3,706 | ) | | (10,245 | ) |
Amortization of debt issuance costs | (4,470 | ) | | (3,841 | ) |
Interest income received on securitization investment | (6,299 | ) | | (5,884 | ) |
Adjusted Interest Expense | $ | 173,702 |
| | $ | 187,444 |
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DEBT TO EBITDA RATIO: The ratio of (a) Aimco’s share of net leverage as calculated on Supplemental Schedule 5(a), excluding preferred securities to (b) EBITDA.
DEBT AND PREFERRED EQUITY TO EBITDA RATIO: The ratio of (a) Aimco’s share of net leverage as calculated on Supplemental Schedule 5(a) to (b) EBITDA.
DEBT SERVICE COVERAGE RATIO: As defined in Aimco’s credit agreement, the ratio of (a) Earnings Before Interest, Taxes, Depreciation and Amortization, reduced by a $350 per apartment home capital expenditure allowance (which Aimco refers to as “Compliance EBITDA”), to (b) debt service, which represents the sum of (i) Aimco’s proportionate share of interest expense (excluding prepayment penalties and amortization of debt issuance costs) and (ii) debt amortization, for the four fiscal quarters preceding the date of calculation.
FIXED CHARGE COVERAGE RATIO: As defined by Aimco’s credit agreement, the ratio of (a) Compliance EBITDA to (b) fixed charges, which represent the sum of (i) Aimco’s proportionate share of interest expense (excluding prepayment penalties and amortization of debt issuance costs), (ii) debt amortization and (iii) Preferred Dividends, for the four fiscal quarters preceding the date of calculation.
PREFERRED DIVIDENDS: Preferred dividends include dividends paid with respect to Aimco’s Preferred Stock and the Aimco OP’s Preferred Partnership Units, exclusive of preferred equity redemption related amounts.
PREFERRED EQUITY: Preferred equity represents the redemption amounts for Aimco’s Preferred Stock and the Aimco OP’s Preferred Partnership Units and may be found in Aimco’s consolidated balance sheets.
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (EBITDA): EBITDA represents Aimco’s share of the consolidated amount of Aimco net income, adjusted to exclude the effect of the following items for the reasons set forth below:
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• | interest expense, preferred dividends and interest income earned on the securitization investment, to allow investors to compare a measure of Aimco earnings before the effects of Aimco’s capital structure and indebtedness with that of other companies in the real estate industry; |
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• | income taxes, to allow investors to measure Aimco performance independent of income taxes, which may vary significantly from other companies within Aimco’s industry due to leverage and tax planning strategies, among other drivers; |
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• | depreciation and amortization, gains or losses on dispositions and impairment losses related to real estate, for similar reasons to those set forth in the discussion of FFO, Pro forma FFO and AFFO above; and |
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• | other items, including gains on dispositions of non-depreciable assets, as these are items that periodically affect Aimco operations, but that are not necessarily representative of Aimco’s ability to service its debt obligations. |
A reconciliation of net income attributable to Aimco Common Stockholders to EBITDA for each of the periods presented is as follows:
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| | | | | | | | |
(in thousands) (unaudited) | Trailing Twelve Months Ended | |
| June 30, | |
| 2016 | | 2015 | |
Net income attributable to Aimco Common Stockholders | $ | 330,424 |
| | $ | 311,123 |
| |
Adjustments: | | | | |
Interest expense, net of noncontrolling interest | 188,178 |
| | 207,413 |
| |
Income tax benefit | (28,502 | ) | | (27,030 | ) | |
Depreciation and amortization, net of noncontrolling interest | 310,173 |
| | 282,812 |
| |
Gains on disposition and other, net of income taxes and noncontrolling partners’ interests | (267,087 | ) | | (266,372 | ) | |
Preferred stock dividends | 11,029 |
| | 12,014 |
| |
Interest income earned on securitization investment | (6,299 | ) | | (5,884 | ) | |
Net income attributable to noncontrolling interests in Aimco Operating Partnership | 24,016 |
| | 23,827 |
| |
Other items, net | 5,487 |
| | 4,287 |
| |
EBITDA | $ | 567,419 |
| | $ | 542,190 |
| |
NET OPERATING INCOME (NOI) CAP RATE: NOI Cap Rate is calculated based on Aimco’s share of the trailing twelve month prior to sale proportionate property NOI, less a 3.0% management fee, divided by Aimco gross proceeds.
NET OPERATING INCOME (NOI) MARGIN: Represents an apartment community’s net operating income as a percentage of the apartment community’s rental and other property revenues.
OTHER CONVENTIONAL APARTMENT COMMUNITIES: Conventional Apartment Communities that do not meet the Same Store Apartment Community definition because they have significant rent control restrictions or have not reached and/or maintained a stabilized level of occupancy, often due to a casualty event, or are expected to be sold within the next 12 months.
OTHER EXPENSES, NET: Other expenses, net includes franchise taxes, risk management activities related to Aimco’s unconsolidated partnerships and certain other corporate expenses and expenses specifically related to Aimco’s administration of its real estate partnerships, for example, services such as audit, tax and legal.
PROPERTY NET OPERATING INCOME (NOI): NOI is defined by Aimco as total property rental and other property revenues less direct property operating expenses, including real estate taxes. NOI does not include: property management revenues, primarily from affiliates; casualties; property management expenses; depreciation; or interest expense. NOI is helpful because it helps both investors and management to understand the operating performance of real estate excluding costs associated with decisions about acquisition pricing, overhead allocations and financing arrangements. NOI is considered by many in the real estate industry to be a useful measure for determining the value of real estate. Reconciliations of NOI as presented in this Earnings Release and Supplemental Information to Aimco’s consolidated GAAP amounts are provided on the following pages.
Aimco evaluates the performance of its Conventional and Affordable portfolios using various operating and financial measures, including Proportionate NOI, which represents Proportionate Rental and Other Property Revenues less Proportionate Property Operating Expenses. Aimco presents Proportionate Rental and Other Property Revenues, Property Operating Expenses and Property NOI for the trailing five quarters for its Conventional and Affordable portfolios on Supplemental Schedule 3. Reconciliation of the consolidated amounts of Rental and Other Property Revenues and Property Operating Expense, as originally reported in Aimco’s consolidated statements of operations, to the proportionate amounts presented in Supplemental Schedule 3 has been provided below.
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Reconciliation of GAAP to Supplemental Schedule 3 Proportionate Property NOI Amounts |
(in thousands)(unaudited) | | Three Months Ended |
| | June 30, 2016 | | March 31, 2016 | | December 31, 2015 | | September 30, 2015 | | June 30, 2015 |
Rental and other property revenues | | $ | 242,871 |
| | $ | 241,481 |
| | $ | 239,646 |
| | $ | 240,382 |
| | $ | 238,637 |
|
Sold and held for sale property revenues | | (4,992 | ) | | (7,605 | ) | | (9,889 | ) | | (10,891 | ) | | (14,505 | ) |
Property management revenues | | (2 | ) | | (2 | ) | | 2 |
| | (7 | ) | | (3 | ) |
Proportionate share of unconsolidated partnerships | | 1,562 |
| | 1,567 |
| | 1,539 |
| | 1,461 |
| | 1,530 |
|
Noncontrolling interests | | (7,176 | ) | | (7,329 | ) | | (7,359 | ) | | (7,428 | ) | | (7,279 | ) |
Proportionate property amount | | $ | 232,263 |
| | $ | 228,112 |
| | $ | 223,939 |
| | $ | 223,517 |
| | $ | 218,380 |
|
| | | | | | | | | | |
Property operating expenses | | $ | 88,305 |
| | $ | 88,397 |
| | $ | 87,350 |
| | $ | 88,621 |
| | $ | 87,930 |
|
Sold and held for sale property expenses | | (2,223 | ) | | (2,689 | ) | | (3,061 | ) | | (3,895 | ) | | (6,187 | ) |
Casualties | | (833 | ) | | (2,150 | ) | | (1,856 | ) | | (830 | ) | | (1,535 | ) |
Property management expenses | | (5,941 | ) | | (5,900 | ) | | (6,788 | ) | | (5,806 | ) | | (6,101 | ) |
Proportionate share of unconsolidated partnerships | | 684 |
| | 623 |
| | 614 |
| | 615 |
| | 640 |
|
Noncontrolling interests | | (2,296 | ) | | (2,398 | ) | | (2,241 | ) | | (2,361 | ) | | (2,331 | ) |
Total direct property operating expenses | | $ | 77,696 |
| | $ | 75,883 |
| | $ | 74,018 |
| | $ | 76,344 |
| | $ | 72,416 |
|
Total Property Net Operating Income | | $ | 154,567 |
| | $ | 152,229 |
| | $ | 149,921 |
| | $ | 147,173 |
| | $ | 145,964 |
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Reconciliation of GAAP to Supplemental Schedule 6(a) Proportionate Conventional Same Store NOI Amounts |
(in thousands) (unaudited) | | | | | | | | |
| | Three Months Ended June 30, 2016 |
| | Consolidated Amounts | | Noncontrolling Interests | | Proportionate Amount | | Ownership and Other Adjustments | | Proportionate Property Amount |
Conventional Same Store: | | | | | | | | | | |
Rental and other property revenues | | $ | 173,400 |
| | $ | (4,711 | ) | | $ | 168,689 |
| | $ | (188 | ) | | $ | 168,501 |
|
Property operating expenses | | 54,383 |
| | (1,484 | ) | | 52,899 |
| | 1 |
| | 52,900 |
|
Property NOI | | $ | 119,017 |
| | $ | (3,227 | ) | | $ | 115,790 |
| | $ | (189 | ) | | $ | 115,601 |
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| | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, 2015 |
| | Consolidated Amounts | | Noncontrolling Interests | | Proportionate Amount | | Ownership and Other Adjustments | | Proportionate Property Amount |
Conventional Same Store: | | | | | | | | | | |
Rental and other property revenues | | $ | 166,444 |
| | $ | (4,610 | ) | | $ | 161,834 |
| | $ | (185 | ) | | $ | 161,649 |
|
Property operating expenses | | 52,039 |
| | (1,484 | ) | | 50,555 |
| | 1 |
| | 50,556 |
|
Property NOI | | $ | 114,405 |
| | $ | (3,126 | ) | | $ | 111,279 |
| | $ | (186 | ) | | $ | 111,093 |
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Reconciliation of GAAP to Supplemental Schedule 6(b) Proportionate Conventional Same Store NOI Amounts |
(in thousands) (unaudited) | | | | | | | | | | |
| | Three Months Ended March 31, 2016 |
| | Consolidated Amounts | | Noncontrolling Interests | | Proportionate Amount | | Ownership and Other Adjustments | | Proportionate Property Amount |
Conventional Same Store: | | | | | | | | | | |
Rental and other property revenues | | $ | 172,084 |
| | $ | (4,750 | ) | | $ | 167,334 |
| | $ | (189 | ) | | $ | 167,145 |
|
Property operating expenses | | 53,613 |
| | (1,570 | ) | | 52,043 |
| | 434 |
| | 52,477 |
|
Property NOI | | $ | 118,471 |
| | $ | (3,180 | ) | | $ | 115,291 |
| | $ | (623 | ) | | $ | 114,668 |
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Reconciliation of GAAP to Supplemental Schedule 6(c) Proportionate Conventional Same Store NOI Amounts |
(in thousands) (unaudited) | | | | | | | | |
| | Six Months Ended June 30, 2016 |
| | Consolidated Amounts | | Noncontrolling Interests | | Proportionate Amount | | Ownership and Other Adjustments | | Proportionate Property Amount |
Conventional Same Store: | | | | | | | | | | |
Rental and other property revenues | | $ | 345,483 |
| | $ | (9,460 | ) | | $ | 336,023 |
| | $ | (376 | ) | | $ | 335,647 |
|
Property operating expenses | | 107,997 |
| | (3,054 | ) | | 104,943 |
| | 435 |
| | 105,378 |
|
Property NOI | | $ | 237,486 |
| | $ | (6,406 | ) | | $ | 231,080 |
| | $ | (811 | ) | | $ | 230,269 |
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| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | |
| | Six Months Ended June 30, 2015 |
| | Consolidated Amounts | | Noncontrolling Interests | | Proportionate Amount | | Ownership and Other Adjustments | | Proportionate Property Amount |
Conventional Same Store: | | | | | | | | | | |
Rental and other property revenues | | $ | 330,674 |
| | $ | (9,145 | ) | | $ | 321,529 |
| | $ | (358 | ) | | $ | 321,171 |
|
Property operating expenses | | 106,044 |
| | (3,052 | ) | | 102,992 |
| | (1 | ) | | 102,991 |
|
Property NOI | | $ | 224,630 |
| | $ | (6,093 | ) | | $ | 218,537 |
| | $ | (357 | ) | | $ | 218,180 |
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Ownership and other adjustments represents adjustments to provide comparability of Conventional Same Store results from period to period. The adjustments include ownership difference between the periods.
Additionally, property operating expenses for first quarter 2016 include a property tax refund which relates to periods prior to the affected apartment community’s inclusion in Aimco’s Conventional Same Store population.
PORTFOLIO QUALITY RATINGS: Aimco measures portfolio quality based on apartment community rents compared to local market average rents as reported by REIS, a third-party provider of commercial real estate performance information and analysis. Aimco defines portfolio quality as follows: “A” quality properties are those with rents greater than 125% of the local market average; “B” quality properties are those with rents between 90% and 125% of the local market average; “C+” quality properties are those with rents greater than $1,100 per month but lower than 90% of the local market average; and “C” quality assets are those with rents less than $1,100 per month and lower than 90% of the local market average.
SOLD AND HELD FOR SALE APARTMENT COMMUNITIES: Apartment communities either sold since January 1, 2015 or classified as held for sale at the end of the period. For purposes of highlighting results of operations related to Aimco’s retained portfolio, results for Sold and Held For Sale Apartment Communities are excluded from Net Real Estate Operations and shown separately on a net basis in Aimco’s Proportionate FFO presentation found in Supplemental Schedule 2 and in Aimco’s Proportionate Property NOI presentation found in Supplemental Schedule 3.