EXHIBIT 99.1
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AMLI 125 South Wacker Drive
RESIDENTIAL Chicago, Illinois 60606
Phone: 312.443.1477
Fax: 312.443.0909
www.amli.com
PRESS RELEASE
FOR IMMEDIATE RELEASE
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OCTOBER 25, 2005 For More Information, Contact:
Robert J. Chapman,
Chief Financial Officer
(312) 984-6845
AMLI RESIDENTIAL ANNOUNCES THIRD QUARTER
OPERATING RESULTS AND DECLARES DIVIDEND
(CHICAGO, IL) AMLI RESIDENTIAL PROPERTIES TRUST (NYSE: AML) announces today
operating results for the third quarter ended September 30, 2005.
EARNINGS
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Net income for the quarter and nine months ended September 30, 2005 was
$44,136,000 and $75,757,000, respectively, as compared to $12,234,000 and
$61,257,000, respectively, in the year earlier periods. Diluted Earnings
Per Share ("EPS") for the quarter ended September 30, 2005 was $1.48
compared to $0.41 for the same period a year earlier, an increase of 261%.
For the nine months ended September 30, 2005, EPS was $2.52 compared to
$2.13 for the comparable period of 2004.
The difference in net income between the current quarter and the third
quarter last year and net income for the nine months ended September 30,
2005 versus the comparable period in 2004 is primarily attributable to the
differences in the amount of aggregate gains recognized from a combination
of sales of rental properties, net of minority interest, sales of
partnership interests in existing wholly-owned communities and AMLI's share
of gains on sales of partnership properties. Such amounts were $41,900,000
and $73,934,000 for the three and nine months ended September 30, 2005,
respectively, and $11,318,000 and $51,282,000 for the three and nine months
ended September 30, 2004, respectively.
FUNDS FROM OPERATIONS ("FFO") for the third quarter 2005 were $16,042,000,
or $0.51 per common share, compared to $13,576,000, or $0.44 per common
share, for the third quarter 2004 (a per share increase of 15.9%). Actual
results for the third quarter were consistent with both the mid-point of
AMLI's most current guidance and First Call's most recent estimate.
"The results of the quarter were significantly better than a year ago,
reflecting continuing improvement in community operations, full investment
of the proceeds of our common share offering in March 2004 and positive
contributions from transactional activity," stated Robert J. Chapman, AMLI
Chief Financial Officer. "Same community total revenues continue to
increase year over year and sequentially over the prior quarter. The
increase in third quarter community operating expenses compared to last
year is not representative of a full year run rate, and we still expect
community revenue, operating expenses and NOI for the full year 2005 to be
within the range of our guidance."
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THIRD QUARTER ACTIVITIES
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During the third quarter, AMLI purchased AMLI Memorial Heights (380
apartments) in Houston, Texas and sold AMLI at Poplar Creek (196
apartments) in Schaumburg, Illinois. AMLI also completed the initial lease-
up and stabilization of AMLI Downtown (220 apartments, retail and parking)
in Austin, Texas and closed on a $25 million first mortgage permanent loan
secured only by the residential portion. AMLI owns a 30% interest in AMLI
Downtown.
Additionally AMLI entered into three joint ventures during the quarter. In
two transactions AMLI sold a 60% partnership interest in AMLI at Riverbend
(996 apartments) in Indianapolis, Indiana and an 80% partnership interest
in AMLI at Oakhurst North (464 apartments) in Aurora (Chicago), Illinois,
both stabilized, previously wholly-owned apartment communities, to a client
of The Tuckerman Group LLC. In addition to retaining an ownership in both
communities, AMLI was paid certain fees upon closing of the joint ventures.
In the third transaction, AMLI entered into a joint venture with The
Northwestern Mutual Life Insurance Company ("Northwestern Mutual") to
develop and own AMLI Perimeter Gardens (245 apartments) in the Dunwoody
neighborhood of northeast Atlanta, Georgia. The joint venture is structured
such that cash flow and sales proceeds will be shared 75% to Northwestern
Mutual and 25% to AMLI Residential until certain benchmarks are achieved,
at which point AMLI will receive an increased portion of the cash flow and
residual interest.
Early in the quarter, AMLI modified the terms of the Company's three
unsecured bank credit facilities, including its two revolving lines of
credit and its $110 million term loan. The commitment amounts under the
primary and secondary lines of credit were increased to $250 million and
$20 million, respectively, and the maturity dates were reset to three years
from closing. The pricing and certain covenants under all three facilities
were also amended.
SAME COMMUNITY RESULTS
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On a combined same community basis, which includes both wholly-owned and
co-investment communities (at 100%), for the quarter ended September 30,
2005 versus the prior year's comparable quarter, total community revenue
increased 1.6% (reflecting an increase in weighted average occupancy to
94.9% from 93.9% and an increase in weighted average collected revenue per
occupied unit of 0.5%), operating expenses increased by 4.6% (partially
reflecting quarterly timing differences), and net operating income ("NOI")
decreased by 0.5%.
Comparing the third quarter of 2005 to the preceding quarter, total
community revenue increased by 1.9% (reflecting an increase in weighted
average occupancy of 1.3% and an increase in weighted average collected
revenue per occupied unit of 0.4%), operating expenses increased 5.3%
(reflecting some seasonality), and NOI decreased 0.6%.
SUBSEQUENT EVENTS
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Yesterday, AMLI and Morgan Stanley Real Estate's Prime Property Fund
(PRIME) announced that PRIME entered into a definitive agreement to acquire
AMLI in an all-cash transaction totaling approximately $2.1 billion. Under
the terms of the agreement PRIME will acquire all of AMLI's common shares
for $37.75 per share in cash. Holders of limited partnership units in
AMLI's operating partnership will also receive $37.75 per unit in cash.
AMLI will continue to pay regular quarterly distributions at an annualized
rate of $1.92 per share and per unit through the closing of the
transaction. Completion of the transaction, which is expected to occur
during the first quarter of 2006, is subject to approval by AMLI's common
shareholders and certain other customary closing conditions.
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OUTLOOK
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AMLI's current expectation for FFO for the fourth quarter and full year
2005 is now plus or minus $0.02 from the midpoints of $0.69 per share and
$2.15 per share, reflecting an approximately $0.20 per share contribution
from the potential disposition of a community built for sale by one of the
Company's subsidiaries that had previously been assumed to occur in 2006.
The following chart reconciles AMLI's current FFO per share guidance to
EPS:
Actual Actual Actual Full
Q1 Q2 Q3 Q4 Year
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EPS per Common Share $ 0.76 $ 0.28 $ 1.48 $ 0.34 $ 2.85
Gains on Sales ($ 0.85) ($ 0.35) ($ 1.47) ($ 0.30) ($ 2.96)
Depreciation $ 0.45 $ 0.45 $ 0.43 $ 0.40 $ 1.73
Adjustment for
Preferred Shares $ 0.07 $ 0.14 $ 0.07 $ 0.25 $ 0.53
FFO per Share $ 0.43 $ 0.52 $ 0.51 $ 0.69 $ 2.15
DIVIDEND
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Yesterday, the Board of Trustees declared a quarterly dividend of $0.48 per
common share. This dividend is payable on November 15, 2005 to all common
shareholders of record as of November 4, 2005 and is based on an annual
dividend rate of $1.92 per common share.
CONFERENCE CALL
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AMLI will hold a conference call on Wednesday, October 26, 2005 at 3:30
p.m. Eastern Time. The toll-free number for the call is (800) 946-0706 -
Passcode: 994697, and should be accessed approximately 5 minutes prior to
conference time. A live webcast of the conference call will also be
available in the 'Company Info' section on AMLI's website
(www.amli.com/comp/) and at www.streetevents.com, a password-protected
event management site. Additionally, an on-line replay of the webcast will
be available for 60 days following the call.
SUPPLEMENTAL INFORMATION
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AMLI produces Quarterly Supplemental Information that provides detailed
information regarding the Company's activities during the quarter. The
Third Quarter Supplemental Information is available in the 'Company Info'
section on our website (www.amli.com/comp/) under 'Shareholder Reports.'
DEFINITIONS
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This press release and the Quarterly Supplemental Information described
above contain certain non-GAAP ("Generally Accepted Accounting Principles")
information that is generally provided by most publicly-traded residential
REITs. AMLI uses this information internally to measure its performance
and/or liquidity and to compare its performance to other REITs in its peer
group, and believes that this information may be of interest and use to the
investment community for the same reason.
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Except where indicated, community revenue, community expenses, net
operating income ("NOI") and earnings before interest, taxes, depreciation
and amortization ("EBITDA") are computed based on various line items
included in our consolidated statements of income prepared in accordance
with GAAP. Where indicated, this information is presented on a basis that
includes AMLI's proportionate share of the non-GAAP financial measures of
its co-investment partnerships.
Reconciliations of all non-GAAP financial measures to GAAP financial
measures are included in the Company's Quarterly Supplemental Financial
information, primarily pages 18 and 19.
EBITDA is NOI (including AMLI's proportionate share of the NOI of its co-
investment partnerships) plus all fees and interest income and income from
the Service Companies and gains or losses from sales or valuation of land
and other income, less general and administration expense.
FUNDS FROM OPERATIONS ("FFO") is EBITDA less interest expense (including
AMLI's proportionate share of the interest expense of its co-investment
partnerships and amortization of deferred financing expense) and any income
taxes. FFO computed in this manner is equal to FFO as defined in NAREIT's
white paper, which definition is "net income (computed in accordance with
GAAP), excluding gains (or losses) from sales of property, plus
depreciation and amortization, and after adjustments for unconsolidated
partnerships and joint ventures."
Additional definitions can be found in the Quarterly Supplemental
Information.
ABOUT AMLI
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The AMLI<registered trademark> portfolio currently includes 75 apartment
communities containing 28,356 apartment homes, with an additional 827
apartment homes under development or in lease-up in three locations. AMLI
is focused on the development, acquisition and management of institutional
quality multifamily communities in the Southeast, Southwest, Midwest and
Mountain regions of the U.S. AMLI Residential also serves as institutional
advisor and asset manager for large pension funds, tax-exempt foundations
and other financial institutions through AMLI's co-investment business.
AMLI employs approximately 850 people who are dedicated to achieving AMLI's
mission -- Provide An Outstanding Living Environment For Our Residents.
More information on AMLI is available at www.amli.com.
FORWARD-LOOKING STATEMENTS
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Certain matters discussed in this press release are forward-looking
statements within the meaning of Federal Securities Law. Although the
Company believes expectations reflected in such forward looking statements
are based upon reasonable assumptions, it can give no assurance that its
expectations will be achieved.
Forward-looking statements can be identified by the Company's use of the
words "project," "believe," "expect," "anticipate," "intend," "estimate,"
"assume," and other similar expressions that predict or indicate future
events, achievements or trends or that do not relate to historical matters.
The Company does not assure the future results or outcome of the matters
described in forward-looking statements; rather, these statements merely
reflect the Company's current expectations of the approximate outcomes of
the matters discussed. Forward-looking statements involve known and unknown
risks, uncertainties and other factors, some of which are beyond the
Company's control. The reader is cautioned to make his/her own judgment
with regard to the statements discussed in this press release and the
assumption noted by the Company herein.
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The Company is making forward-looking statements because it believes
investors, analysts and others, many of whom prepare models and projections
of the Company's performance, are interested in the Company's current
estimates of its future activities. The Company advises such parties to
make their own determination of any relevant or material assumption used by
them.
Many factors may cause the Company's actual performance in any period or
periods to differ materially from the anticipated future performance
expressed or implied by these forward-looking statements. Certain of the
factors that could cause the Company's actual performance to differ
materially from those expressed or implied by these forward-looking
statements include, but are not limited to, general economic conditions,
local real estate conditions, the timely development and lease-up of
communities, other risks detailed from time to time in the Company's SEC
reports, including the annual report on form 10-K for the year ended
December 31, 2004.
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