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SECURITIES AND EXCHANGE COMMISSION
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Maryland | 84-1259577 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) | |
4582 South Ulster Street Parkway, Suite 1100 | ||
Denver, Colorado | 80237 | |
(Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code)
(Former name, former address, and former fiscal year, if changed since last report)
Large accelerated filerþ | Accelerated filero | Non-accelerated filero | Smaller reporting companyo | |||
(Do not check if a smaller reporting company) |
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Exhibit 3.2 | ||||||||
Exhibit 10.1 | ||||||||
Exhibit 31.1 | ||||||||
Exhibit 31.2 | ||||||||
Exhibit 32.1 | ||||||||
Exhibit 32.2 | ||||||||
Exhibit 99.1 |
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(Unaudited)
March 31, | December 31, | |||||||
2009 | 2008 | |||||||
ASSETS | ||||||||
Real estate: | ||||||||
Buildings and improvements | $ | 8,568,442 | $ | 8,520,382 | ||||
Land | 2,337,853 | 2,326,671 | ||||||
Total real estate | 10,906,295 | 10,847,053 | ||||||
Less accumulated depreciation | (2,883,910 | ) | (2,771,131 | ) | ||||
Net real estate | 8,022,385 | 8,075,922 | ||||||
Cash and cash equivalents | 93,233 | 299,676 | ||||||
Restricted cash | 265,639 | 258,156 | ||||||
Accounts receivable, net | 80,689 | 92,923 | ||||||
Accounts receivable from affiliates, net | 32,833 | 36,372 | ||||||
Deferred financing costs, net | 58,388 | 59,070 | ||||||
Notes receivable from unconsolidated real estate partnerships, net | 24,267 | 22,567 | ||||||
Notes receivable from non-affiliates, net | 139,949 | 139,897 | ||||||
Investment in unconsolidated real estate partnerships | 121,322 | 119,036 | ||||||
Other assets | 199,203 | 188,764 | ||||||
Deferred income tax assets, net | 27,052 | 28,326 | ||||||
Assets held for sale | 17,258 | 94,157 | ||||||
Total assets | $ | 9,082,218 | $ | 9,414,866 | ||||
LIABILITIES AND EQUITY | ||||||||
Property tax-exempt bond financing | $ | 720,722 | $ | 721,971 | ||||
Property loans payable | 5,558,506 | 5,545,893 | ||||||
Term loans | 350,000 | 400,000 | ||||||
Credit facility | 15,000 | — | ||||||
Other borrowings | 90,941 | 95,981 | ||||||
Total indebtedness | 6,735,169 | 6,763,845 | ||||||
Accounts payable | 32,902 | 64,241 | ||||||
Accrued liabilities and other | 291,081 | 411,209 | ||||||
Deferred income | 184,796 | 195,202 | ||||||
Security deposits | 42,774 | 43,088 | ||||||
Liabilities related to assets held for sale | 5,176 | 70,599 | ||||||
Total liabilities | 7,291,898 | 7,548,184 | ||||||
Preferred noncontrolling interests in Aimco Operating Partnership | 87,247 | 88,148 | ||||||
Commitments and contingencies (Note 5) | ||||||||
Equity: | ||||||||
Perpetual Preferred Stock | 696,500 | 696,500 | ||||||
Class A Common Stock, $.01 par value, 426,157,736 shares authorized, 116,477,696 and 116,180,877 shares issued and outstanding, at March 31, 2009 and December 31, 2008, respectively | 1,165 | 1,162 | ||||||
Additional paid-in capital | 3,061,099 | 3,056,550 | ||||||
Notes due on common stock purchases | (2,148 | ) | (3,607 | ) | ||||
Distributions in excess of earnings | (2,372,038 | ) | (2,335,628 | ) | ||||
Total Aimco equity | 1,384,578 | 1,414,977 | ||||||
Noncontrolling interests in consolidated real estate partnerships | 323,414 | 363,557 | ||||||
Common noncontrolling interests in Aimco Operating Partnership | (4,919 | ) | — | |||||
Total equity | 1,703,073 | 1,778,534 | ||||||
Total liabilities and equity | $ | 9,082,218 | $ | 9,414,866 | ||||
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(Unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
REVENUES: | ||||||||
Rental and other property revenues | $ | 338,093 | $ | 332,892 | ||||
Property management revenues, primarily from affiliates | 1,644 | 2,104 | ||||||
Asset management and tax credit revenues | 9,539 | 12,852 | ||||||
Total revenues | 349,276 | 347,848 | ||||||
OPERATING EXPENSES: | ||||||||
Property operating expenses | 156,489 | 161,764 | ||||||
Property management expenses | 1,433 | 1,335 | ||||||
Investment management expenses | 3,789 | 4,387 | ||||||
Depreciation and amortization | 123,215 | 103,500 | ||||||
General and administrative expenses | 20,072 | 21,366 | ||||||
Other expenses, net | 2,292 | 5,751 | ||||||
Total operating expenses | 307,290 | 298,103 | ||||||
Operating income | 41,986 | 49,745 | ||||||
Interest income | 3,340 | 8,115 | ||||||
Provision for losses on notes receivable, net | (150 | ) | (223 | ) | ||||
Interest expense | (91,511 | ) | (91,533 | ) | ||||
Equity losses of unconsolidated real estate partnerships | (2,040 | ) | (1,029 | ) | ||||
Provision for operating real estate impairment losses | (1,760 | ) | — | |||||
Gain (loss) on dispositions of unconsolidated real estate and other | 10,862 | (137 | ) | |||||
Loss before income taxes and discontinued operations | (39,273 | ) | (35,062 | ) | ||||
Income tax benefit | 3,016 | 1,772 | ||||||
Loss from continuing operations | (36,257 | ) | (33,290 | ) | ||||
Income from discontinued operations, net | 3,688 | 8,159 | ||||||
Net loss | (32,569 | ) | (25,131 | ) | ||||
Noncontrolling interests: | ||||||||
Net loss (income) attributable to noncontrolling interests in consolidated real estate partnerships | 6,273 | (1,843 | ) | |||||
Net income attributable to preferred noncontrolling interests in Aimco Operating Partnership | (1,069 | ) | (1,782 | ) | ||||
Net loss attributable to common noncontrolling interests in Aimco Operating Partnership | 2,835 | 4,108 | ||||||
Total noncontrolling interests | 8,039 | 483 | ||||||
Net loss attributable to Aimco | (24,530 | ) | (24,648 | ) | ||||
Net income attributable to Aimco preferred stockholders | 13,166 | 14,208 | ||||||
Net loss attributable to Aimco common stockholders | $ | (37,696 | ) | $ | (38,856 | ) | ||
Earnings (loss) attributable to Aimco per common share – basic and diluted (Note 6): | ||||||||
Loss from continuing operations attributable to Aimco (net of income attributable to preferred stockholders) | $ | (0.33 | ) | $ | (0.34 | ) | ||
Income from discontinued operations attributable to Aimco | — | 0.04 | ||||||
Net loss attributable to Aimco common stockholders | $ | (0.33 | ) | $ | (0.30 | ) | ||
Weighted average common shares outstanding, basic and diluted | 115,099 | 127,961 | ||||||
Dividends declared per common share | $ | 0.00 | $ | 0.00 | ||||
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(Unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net loss | $ | (32,569 | ) | $ | (25,131 | ) | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||||
Depreciation and amortization | 123,215 | 103,500 | ||||||
(Gain) loss on dispositions of unconsolidated real estate | (10,862 | ) | 137 | |||||
Discontinued operations | (8,153 | ) | 20,458 | |||||
Other adjustments | 10,126 | 9,249 | ||||||
Net changes in operating assets and operating liabilities | (99,531 | ) | (49,726 | ) | ||||
Net cash (used in) provided by operating activities | (17,774 | ) | 58,487 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital expenditures | (68,370 | ) | (150,823 | ) | ||||
Proceeds from dispositions of real estate | 53,630 | 33,351 | ||||||
Purchases of partnership interests and other assets | (1,350 | ) | (8,413 | ) | ||||
Originations of notes receivable from unconsolidated real estate partnerships | (3,146 | ) | (3,497 | ) | ||||
Proceeds from repayment of notes receivable | 1,468 | 4,880 | ||||||
Other investing activities | 8,869 | 10,968 | ||||||
Net cash used in investing activities | (8,899 | ) | (113,534 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from property loans | 173,149 | 213,321 | ||||||
Principal repayments on property loans | (187,926 | ) | (136,197 | ) | ||||
Proceeds from tax-exempt bond financing | — | 21,200 | ||||||
Principal repayments on tax-exempt bond financing | (4,319 | ) | (1,228 | ) | ||||
Payments on term loans | (50,000 | ) | — | |||||
Net borrowings on revolving credit facility | 15,000 | 218,800 | ||||||
Repurchases of Class A Common Stock | — | (199,370 | ) | |||||
Payment of Class A Common Stock dividends | (60,383 | ) | (54,655 | ) | ||||
Payment of preferred stock dividends | (13,166 | ) | (14,208 | ) | ||||
Payment of distributions to noncontrolling interests | (58,151 | ) | (46,554 | ) | ||||
Other financing activities | 6,026 | 6,560 | ||||||
Net cash (used in) provided by financing activities | (179,770 | ) | 7,669 | |||||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (206,443 | ) | (47,378 | ) | ||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 299,676 | 210,461 | ||||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 93,233 | $ | 163,083 | ||||
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(Unaudited)
• | owned an equity interest in and consolidated 115,723 units in 504 properties (which we refer to as “consolidated properties”), of which 113,102 units were also managed by us; |
• | owned an equity interest in and did not consolidate 9,431 units in 84 properties (which we refer to as “unconsolidated properties”), of which 4,364 units were also managed by us; and |
• | provided services for or managed 34,964 units in 388 properties, primarily pursuant to long-term agreements (including 32,501 units in 361 properties for which we provide asset management services only, and not also property management services). In certain cases, we may indirectly own generally less than one percent of the operations of such properties through a partnership syndication or other fund. |
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Loss from continuing operations attributable to Aimco (net of income attributable to preferred stockholders) | $ | (59,987 | ) | |
Loss from discontinued operations attributable to Aimco | (1,170 | ) | ||
Net loss attributable to Aimco common stockholders | $ | (61,157 | ) | |
Basic and diluted earnings (loss) per common share: | ||||
Loss from continuing operations attributable to Aimco (net of income attributable to preferred stockholders) | $ | (0.52 | ) | |
Loss from discontinued operations attributable to Aimco | (0.01 | ) | ||
Net loss attributable to Aimco common stockholders | $ | (0.53 | ) | |
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Equity | ||||||||||||||||||||
Common | ||||||||||||||||||||
Preferred | Noncontrolling | noncontrolling | ||||||||||||||||||
noncontrolling | interests in | interests in | ||||||||||||||||||
interests in Aimco | consolidated | Aimco | ||||||||||||||||||
Operating | Equity attributable | real estate | Operating | |||||||||||||||||
Partnership | to Aimco | partnerships | Partnership | Total equity | ||||||||||||||||
Balance, December 31, 2008 | $ | 88,148 | $ | 1,414,977 | $ | 363,557 | $ | — | $ | 1,778,534 | ||||||||||
Contributions | — | — | 3,035 | — | 3,035 | |||||||||||||||
Dividends/distributions | (955 | ) | (13,166 | ) | (36,564 | ) | — | (49,730 | ) | |||||||||||
Conversions and repurchases of units and shares | (1,015 | ) | 1,297 | — | (1,333 | ) | (36 | ) | ||||||||||||
Amortization of stock based compensation cost | — | 3,284 | — | — | 3,284 | |||||||||||||||
Other | — | 2,034 | — | (751 | ) | 1,283 | ||||||||||||||
Effect of changes in ownership | — | 470 | (470 | ) | — | — | ||||||||||||||
Change in other comprehensive income | — | 212 | 129 | — | 341 | |||||||||||||||
Net income (loss) | 1,069 | (24,530 | ) | (6,273 | ) | (2,835 | ) | (33,638 | ) | |||||||||||
Balance, March 31, 2009 | $ | 87,247 | $ | 1,384,578 | $ | 323,414 | $ | (4,919 | ) | $ | 1,703,073 | |||||||||
1) | expense acquisition costs in 2008 when it is probable that the acquisition will not close in 2008; | ||
2) | expense acquisition costs January 1, 2009, upon adoption of SFAS 141(R); or | ||
3) | give retroactive treatment to the acquisition costs January 1, 2009, upon adoption of SFAS 141(R), by retroactively adjusting prior periods to record acquisition costs in the prior periods in which they were incurred, in accordance with Statement of Financial Accounting Standards No. 154,Accounting Changes and Error Corrections. |
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Unrealized | Realized gains | |||||||||||||||
Fair value at | gains (losses) | (losses) | Fair value at | |||||||||||||
December 31, | included in | included in | March 31, | |||||||||||||
2008 | earnings (1) | earnings (2) | 2009 | |||||||||||||
Total rate of return swaps (3) | $ | (29,495 | ) | $ | 783 | (4) | $ | –– | $ | (28,712 | ) | |||||
Changes in fair value of debt instruments subject to total rate of return swaps (5) | 29,495 | (783 | )(4) | –– | 28,712 | |||||||||||
Total | $ | — | $ | — | $ | — | $ | — | ||||||||
(1) | Unrealized gains (losses) relate to periodic revaluations of fair value and have not resulted from the settlement of a swap position. | |
(2) | For total rate of return swaps, realized gains (losses) occur upon the settlement, resulting from the repayment of the underlying borrowings or the early termination of the swap, and include any net amounts paid or received upon such settlement. | |
(3) | Total rate of return swaps have contractually-defined termination values generally equal to the difference between the fair value and the counterparty’s purchased value of the underlying borrowings. We calculate the termination value, which we believe is representative of the fair value, of total rate of return swaps using a market approach by reference to estimates of the fair value of the underlying borrowings, which are discussed below, and an evaluation of potential changes in the credit quality of the counterparties to these arrangements. | |
(4) | Included in interest expense in the accompanying condensed consolidated statements of income. | |
(5) | We estimate the fair value of debt instruments using an income and market approach, including comparison of the contractual terms to observable and unobservable inputs such as market interest rate risk spreads, collateral quality and loan-to-value ratios on similarly encumbered assets within our portfolio. These borrowings are collateralized and non-recourse to us; therefore, we believe changes in our credit rating will not materially affect a market participant’s estimate of the borrowings’ fair value. |
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March 31, | December 31, | |||||||
2009 | 2008 | |||||||
Real estate, net | $ | 16,884 | $ | 92,023 | ||||
Other assets | 374 | 2,134 | ||||||
Assets held for sale | $ | 17,258 | $ | 94,157 | ||||
Property debt | $ | 5,023 | $ | 65,285 | ||||
Other liabilities | 153 | 5,314 | ||||||
Liabilities related to assets held for sale | $ | 5,176 | $ | 70,599 | ||||
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Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
Rental and other property revenues | $ | 1,840 | $ | 91,724 | ||||
Property operating expenses | (3,998 | ) | (46,126 | ) | ||||
Depreciation and amortization | (379 | ) | (24,930 | ) | ||||
Other expenses, net | (1,096 | ) | (644 | ) | ||||
Operating (loss) income | (3,633 | ) | 20,024 | |||||
Interest income | 19 | 526 | ||||||
Interest expense | (1,230 | ) | (16,863 | ) | ||||
(Loss) income before gain on dispositions of real estate, impairment recoveries and income tax | (4,844 | ) | 3,687 | |||||
Gain on dispositions of real estate | 4,550 | 4,239 | ||||||
Real estate impairment recoveries, net | 4,613 | — | ||||||
Income tax (expense) benefit | (631 | ) | 233 | |||||
Income from discontinued operations | $ | 3,688 | $ | 8,159 | ||||
Income from discontinued operations attributable to: | ||||||||
Noncontrolling interests in consolidated real estate partnerships | $ | (3,662 | ) | $ | (3,635 | ) | ||
Common noncontrolling interests in Aimco Operating Partnership | (278 | ) | (449 | ) | ||||
Total noncontrolling interests | (3,940 | ) | (4,084 | ) | ||||
Aimco | $ | (252 | ) | $ | 4,075 | |||
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Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
Numerator: | ||||||||
Loss from continuing operations | $ | (36,257 | ) | $ | (33,290 | ) | ||
Add: loss from continuing operations attributable to noncontrolling interests | 11,979 | 4,567 | ||||||
Less: net income attributable to preferred stockholders | (13,166 | ) | (14,208 | ) | ||||
Numerator for basic and diluted earnings per share: | ||||||||
Loss from continuing operations attributable to Aimco (net of income attributable to preferred stockholders) | $ | (37,444 | ) | $ | (42,931 | ) | ||
Income from discontinued operations | $ | 3,688 | $ | 8,159 | ||||
Less: income from discontinued operations attributable to noncontrolling interests | (3,940 | ) | (4,084 | ) | ||||
(Loss) income from discontinued operations attributable to Aimco | $ | (252 | ) | $ | 4,075 | |||
Net loss | $ | (32,569 | ) | $ | (25,131 | ) | ||
Add: net loss attributable to noncontrolling interests | 8,039 | 483 | ||||||
Less: net income attributable to preferred stockholders | (13,166 | ) | (14,208 | ) | ||||
Numerator for basic and diluted earnings per share: | ||||||||
Net loss attributable to Aimco common stockholders | $ | (37,696 | ) | $ | (38,856 | ) | ||
Denominator: | ||||||||
Denominator for basic earnings per share — weighted average number of shares of Common Stock outstanding | 115,099 | 127,961 | ||||||
Effect of dilutive securities: | ||||||||
Dilutive potential common shares | — | — | ||||||
Denominator for diluted earnings per share | 115,099 | 127,961 | ||||||
Earnings (loss) per common share: | ||||||||
Basic and diluted earnings (loss) per common share: | ||||||||
Loss from continuing operations attributable to Aimco (net of income attributable to preferred stockholders) | $ | (0.33 | ) | $ | (0.34 | ) | ||
Income from discontinued operations attributable to Aimco | — | 0.04 | ||||||
Net loss attributable to Aimco common stockholders | $ | (0.33 | ) | $ | (0.30 | ) | ||
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Corporate | ||||||||||||||||
Not Allocated | ||||||||||||||||
Investment | to Segments | |||||||||||||||
Real Estate | Management | and Certain | ||||||||||||||
Segment | Segment | Eliminations | Total | |||||||||||||
Three Months Ended March 31, 2009: | ||||||||||||||||
Rental and other property revenues | $ | 338,093 | $ | — | $ | — | $ | 338,093 | ||||||||
Property management revenues, primarily from affiliates | 1,644 | — | — | 1,644 | ||||||||||||
Asset management and tax credit revenues | — | 9,938 | (399 | ) | 9,539 | |||||||||||
Total revenues | 339,737 | 9,938 | (399 | ) | 349,276 | |||||||||||
Property operating expenses | 156,489 | — | — | 156,489 | ||||||||||||
Property management expenses | 1,433 | — | — | 1,433 | ||||||||||||
Investment management expenses | — | 3,789 | — | 3,789 | ||||||||||||
Depreciation and amortization (1) | — | — | 123,215 | 123,215 | ||||||||||||
General and administrative expenses | — | — | 20,072 | 20,072 | ||||||||||||
Other expenses, net | — | — | 2,292 | 2,292 | ||||||||||||
Total operating expenses | 157,922 | 3,789 | 145,579 | 307,290 | ||||||||||||
Net operating income (loss) | 181,815 | 6,149 | (145,978 | ) | 41,986 | |||||||||||
Other items included in continuing operations (2) | — | 796 | (79,039 | ) | (78,243 | ) | ||||||||||
Income (loss) from continuing operations | $ | 181,815 | $ | 6,945 | $ | (225,017 | ) | $ | (36,257 | ) | ||||||
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Corporate | ||||||||||||||||
Not Allocated | ||||||||||||||||
Investment | to Segments | |||||||||||||||
Real Estate | Management | and Certain | ||||||||||||||
Segment | Segment | Eliminations | Total | |||||||||||||
Three Months Ended March 31, 2008: | ||||||||||||||||
Rental and other property revenues | $ | 332,892 | $ | — | $ | — | $ | 332,892 | ||||||||
Property management revenues, primarily from affiliates | 2,104 | — | — | 2,104 | ||||||||||||
Asset management and tax credit revenues | — | 12,852 | — | 12,852 | ||||||||||||
Total revenues | 334,996 | 12,852 | — | 347,848 | ||||||||||||
Property operating expenses | 161,764 | — | — | 161,764 | ||||||||||||
Property management expenses | 1,335 | — | — | 1,335 | ||||||||||||
Investment management expenses | — | 4,387 | — | 4,387 | ||||||||||||
Depreciation and amortization (1) | — | — | 103,500 | 103,500 | ||||||||||||
General and administrative expenses | — | — | 21,366 | 21,366 | ||||||||||||
Other expenses, net | — | — | 5,751 | 5,751 | ||||||||||||
Total operating expenses | 163,099 | 4,387 | 130,617 | 298,103 | ||||||||||||
Net operating income (loss) | 171,897 | 8,465 | (130,617 | ) | 49,745 | |||||||||||
Other items included in continuing operations (2) | — | 522 | (83,557 | ) | �� | (83,035 | ) | |||||||||
Income (loss) from continuing operations | $ | 171,897 | $ | 8,987 | $ | (214,174 | ) | $ | (33,290 | ) | ||||||
(1) | Our chief operating decision maker assesses the performance of real estate using, among other measures, net operating income, excluding depreciation and amortization. Accordingly, we do not allocate depreciation and amortization to the real estate segment. | |
(2) | Other items in continuing operations for the investment management segment include accretion income recognized on discounted notes receivable, other income items and income taxes associated with transactional activities. Other items in continuing operations not allocated to segments include: (i) interest income and expense; (ii) provision for losses on notes receivable and provision for operating real estate impairment losses; (iii) equity in losses of unconsolidated real estate partnerships; and (iv) gain (loss) on dispositions of unconsolidated real estate and other. |
NOTE 9 — Subsequent Events
On May 1, 2009, we entered into a Sixth Amendment to our Amended and Restated Senior Secured Credit Agreement with a syndicate of financial institutions, which we refer to as the Credit Agreement. The Sixth Amendment provides for a reduction in the aggregate amount of commitments and loans under the Credit Agreement from $985.0 million, comprised of a $350.0 million term loan and $635.0 million of revolving loan commitments to $530.0 million, comprised of a $350.0 million term loan and $180.0 million of revolving loan commitments. Pursuant to the Sixth Amendment, our revolving credit facility matures May 1, 2011, and may be extended for an additional year, subject to certain conditions, including payment of a 45.0 basis point fee on the total revolving commitments and repayment of the entire $350.0 million term loan by February 1, 2011.
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• | an increase in gain on dispositions of unconsolidated real estate and other, primarily related to additional proceeds received in 2009 related to our disposition during 2008 of an interest in an unconsolidated real estate partnership; |
• | a favorable change in the effect on our earnings of noncontrolling interests in consolidated real estate partnerships; and |
• | an increase in net operating income associated with property operations, primarily related to completed redevelopments and a decrease in casualty losses relative to 2008. |
• | a decrease in income from discontinued operations, primarily related to the volume of sales in 2008 and the related number of properties included in discontinued operations in 2008 relative to 2009; |
• | an increase in depreciation and amortization expense, primarily related to completed redevelopments and capital expenditures; and |
• | a decrease in interest income, primarily related to lower cash balances and interest rates. |
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Three Months Ended March 31, | ||||||||
2009 | 2008 | |||||||
Real estate segment revenues: | ||||||||
Rental and other property revenues | $ | 338,093 | $ | 332,892 | ||||
Property management revenues, primarily from affiliates | 1,644 | 2,104 | ||||||
339,737 | 334,996 | |||||||
Real estate segment expenses: | ||||||||
Property operating expenses | 156,489 | 161,764 | ||||||
Property management expenses | 1,433 | 1,335 | ||||||
157,922 | 163,099 | |||||||
Real estate segment net operating income | $ | 181,815 | $ | 171,897 | ||||
Three Months Ended March 31, | ||||||||||||
2009 | 2008 | Change | ||||||||||
Consolidated same store revenues | $ | 212,093 | $ | 213,761 | -0.8 | % | ||||||
Consolidated same store expenses | 83,890 | 85,556 | -1.9 | % | ||||||||
Same store net operating income | 128,203 | 128,205 | — | |||||||||
Reconciling items (1) | 53,612 | 43,692 | 22.7 | % | ||||||||
Real estate segment net operating income | $ | 181,815 | $ | 171,897 | 5.8 | % | ||||||
Same store operating statistics: | ||||||||||||
Properties | 225 | 225 | — | |||||||||
Apartment units | 71,198 | 71,198 | — | |||||||||
Average physical occupancy | 93.6 | % | 94.9 | % | -1.4 | % | ||||||
Average rent/unit/month | $ | 968 | $ | 967 | 0.1 | % |
(1) | Reflects property revenues and property operating expenses related to consolidated properties other than same store properties (e.g., affordable, acquisition, redevelopment and newly consolidated properties) and casualty gains and losses. |
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Three Months Ended March 31, | ||||||||
2009 | 2008 | |||||||
Asset management and tax credit revenues | $ | 9,539 | $ | 12,852 | ||||
Investment management expenses | 3,789 | 4,387 | ||||||
Investment segment net operating income (1) | $ | 5,750 | $ | 8,465 | ||||
(1) | Excludes certain items of income and expense, which are included in our consolidated statements of income in: other expenses, net; interest expense; interest income; gain (loss) on dispositions of unconsolidated real estate and other; and noncontrolling interests in consolidated real estate partnerships. |
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• | the general economic climate; |
• | competition from other apartment communities and other housing options; |
• | local conditions, such as loss of jobs or an increase in the supply of apartments, that might adversely affect apartment occupancy or rental rates; |
• | changes in governmental regulations and the related cost of compliance; |
• | increases in operating costs (including real estate taxes) due to inflation and other factors, which may not be offset by increased rents; |
• | changes in tax laws and housing laws, including the enactment of rent control laws or other laws regulating multifamily housing; |
• | availability and cost of financing; |
• | changes in market capitalization rates; and |
• | the relative illiquidity of such investments. |
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Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
Net loss attributable to Aimco common stockholders (1) | $ | (37,696 | ) | $ | (38,856 | ) | ||
Adjustments: | ||||||||
Depreciation and amortization | 123,215 | 103,500 | ||||||
Depreciation and amortization related to non-real estate assets | (4,393 | ) | (3,817 | ) | ||||
Depreciation of rental property related to noncontrolling partners and unconsolidated entities (2) | (12,280 | ) | (8,697 | ) | ||||
(Gain) loss on dispositions of unconsolidated real estate and other | (10,862 | ) | 137 | |||||
Loss (gain) on dispositions of non-depreciable assets and other | 682 | (16 | ) | |||||
Deficit distributions to noncontrolling partners (3) | — | 3,931 | ||||||
Discontinued operations: | ||||||||
Loss (gain) on dispositions of real estate, net of noncontrolling partners’ interest (2) | 76 | (1,436 | ) | |||||
Depreciation of rental property, net of noncontrolling partners’ interest (2) | 269 | 22,154 | ||||||
Recovery of deficit distributions to noncontrolling partners (3) | — | 273 | ||||||
Income tax expense (benefit) arising from disposals | 215 | (86 | ) | |||||
Noncontrolling interests in Aimco Operating Partnership’s share of above adjustments | (7,317 | ) | (11,114 | ) | ||||
Preferred stock dividends | 13,166 | 14,208 | ||||||
Funds From Operations | $ | 65,075 | $ | 80,181 | ||||
Preferred stock dividends | (13,166 | ) | (14,208 | ) | ||||
Dividends/distributions on dilutive preferred securities | — | 1,333 | ||||||
Funds From Operations attributable to Aimco common stockholders – diluted | $ | 51,909 | $ | 67,306 | ||||
Weighted average number of common shares, participating securities, common share equivalents and dilutive preferred securities outstanding (4): | ||||||||
Common shares, participating securities and common share equivalents (5) | 116,343 | 128,352 | ||||||
Dilutive preferred securities | — | 2,674 | ||||||
Total | 116,343 | 131,026 | ||||||
(1) | Represents the numerator for earnings per common share, calculated in accordance with GAAP (see Note 6 to the condensed consolidated financial statements in Item 1). | |
(2) | “Noncontrolling partners,” means noncontrolling partners in our consolidated real estate partnerships. | |
(3) | Prior to the adoption of SFAS 160 (See Note 2 to the condensed consolidated financial statements in Item 1), we recognized deficit distributions to noncontrolling partners as charges in our income statement when cash was distributed to a noncontrolling partner in a consolidated partnership in excess of the positive balance in such partner’s capital account, which is classified as noncontrolling interests on our balance sheet. We recorded these charges for GAAP purposes even though there is no economic effect or cost. Deficit distributions to noncontrolling partners occur when the fair value of the underlying real estate exceeds its depreciated net book value because the underlying real estate has appreciated or maintained its value. As a result, the recognition of expense for deficit distributions to noncontrolling partners represented, in substance, either (a) our recognition of depreciation previously allocated to the noncontrolling partner or (b) a payment related to the noncontrolling partner’s share of real estate appreciation. Based on White Paper guidance that requires real estate depreciation and gains to be excluded from FFO, we added back deficit distributions and subtracted related recoveries in our reconciliation of net income to FFO. Subsequent to the adoption of SFAS 160, effective January 1, 2009, we may reduce the balance of noncontrolling partners’ capital accounts below zero in such situations and we are no longer required to recognize such charges in our income statement. | |
(4) | Weighted average common shares, common share equivalents and dilutive preferred securities amounts for the periods presented have been retroactively adjusted for the effect of shares of Common Stock issued in connection with the special dividends paid during 2008 and in January 2009. | |
(5) | Represents the denominator for earnings per common share – diluted, calculated in accordance with GAAP, plus additional participating securities and common share equivalents that are dilutive for FFO. In this FFO presentation, we have presented participating securities similar to outstanding shares, which has the same effect on per share amounts as allocating undistributed FFO amounts to the participating securities. |
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Aimco’s | Per | |||||||
Share of | Effective | |||||||
Expenditures | Unit | |||||||
Capital Replacements Detail: | ||||||||
Building and grounds | $ | 6,368 | $ | 64 | ||||
Turnover related | 6,984 | 70 | ||||||
Capitalized site payroll and indirect costs | 2,190 | 22 | ||||||
Our share of Capital Replacements | $ | 15,542 | $ | 156 | ||||
Capital Replacements: | ||||||||
Conventional | $ | 14,045 | $ | 169 | ||||
Affordable | 1,497 | $ | 93 | |||||
Our share of Capital Replacements | 15,542 | $ | 156 | |||||
Capital Improvements: | ||||||||
Conventional | 9,995 | $ | 120 | |||||
Affordable | 914 | $ | 57 | |||||
Our share of Capital Improvements | 10,909 | $ | 110 | |||||
Casualties: | ||||||||
Conventional | 2,537 | |||||||
Affordable | (87 | ) | ||||||
Our share of casualties | 2,450 | |||||||
Redevelopment: | ||||||||
Conventional projects | 21,644 | |||||||
Tax credit projects | 13,858 | |||||||
Our share of redevelopment | 35,502 | |||||||
Our share of capital expenditures | 64,403 | |||||||
Plus noncontrolling partners’ share of consolidated spending | 4,254 | |||||||
Less our share of unconsolidated spending | (287 | ) | ||||||
Total capital expenditures per condensed consolidated statement of cash flows | $ | 68,370 | ||||||
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EXHIBIT NO.(1) | ||||
3.1 | Charter (Exhibit 3.1 to Aimco’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2006, is incorporated herein by reference) | |||
3.2 | Amended and Restated Bylaws | |||
10.1 | Sixth Amendment to Senior Secured Credit Agreement, dated as of May 1, 2009, by and among Apartment Investment and Management Company, AIMCO Properties, L.P., and AIMCO/Bethesda Holdings, Inc., as the Borrowers, the pledgors and guarantors named therein, Bank of America, N.A., as administrative agent and Bank of America, N.A., Keybank National Association and the other lenders listed therein | |||
31.1 | Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||
31.2 | Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||
32.1 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||
32.2 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||
99.1 | Agreement Regarding Disclosure of Long-Term Debt Instruments |
(1) | Schedules and supplemental materials to the exhibits have been omitted but will be provided to the Securities and Exchange Commission upon request. |
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APARTMENT INVESTMENT AND MANAGEMENT COMPANY | ||||
By: | /s/ DAVID ROBERTSON | |||
David Robertson | ||||
President, Chief Investment Officer and Chief Financial Officer (duly authorized officer and principal financial officer) | ||||
By: | /s/ PAUL BELDIN | |||
Paul Beldin | ||||
Senior Vice President and Chief Accounting Officer |
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EXHIBIT NO.(1) | EXHIBIT TITLE | |||
3.1 | Charter (Exhibit 3.1 to Aimco’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2006, is incorporated herein by reference) | |||
3.2 | Amended and Restated Bylaws | |||
10.1 | Sixth Amendment to Senior Secured Credit Agreement, dated as of May 1, 2009, by and among Apartment Investment and Management Company, AIMCO Properties, L.P., and AIMCO/Bethesda Holdings, Inc., as the Borrowers, the pledgors and guarantors named therein, Bank of America, N.A., as administrative agent and Bank of America, N.A., Keybank National Association and the other lenders listed therein | |||
31.1 | Certification of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||
31.2 | Certification of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |||
32.1 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||
32.2 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||
99.1 | Agreement Regarding Disclosure of Long-Term Debt Instruments |
(1) | Schedules and supplemental materials to the exhibits have been omitted but will be provided to the Securities and Exchange Commission upon request. |