NEWS RELEASE
WRIT Washington Real Estate Investment Trust
CONTACT: 6110 Executive Boulevard Listed: NYSE
Marie Donohue Suite 800 Trading Symbol: WRE
Executive Assistant Rockville, MD 20852 Newspaper Quote: WRIT
Direct Dial: 301-255-0802 Tel 301-984-9400 www.writ.com
E-Mail: mdonohue@writ.com Fax 301-984-9610
FOR IMMEDIATE RELEASE November 4, 2002
Page 1 of 5
WASHINGTON REAL ESTATE INVESTMENT TRUST ANNOUNCES
3rd QUARTER TOTAL FUNDS FROM OPERATIONS OF $18.9 MILLION ($0.48 PER SHARE)
Washington Real Estate Investment Trust (WRIT) reported today that Funds From
Operations (FFO) decreased to $18,946,000 for the quarter ended September 30,
2002 from $19,306,000 for the quarter ended September 30, 2001. The following
are reported amounts on a per share basis:
Q3 2002 Q3 2001
------- -------
Funds from Operations ("FFO") Per Share $0.48 $0.50
Funds Available for Distribution ("FAD") Per Share $0.40 $0.44
(Details regarding the above amounts are contained in the following pages. All
amounts are fully diluted per share.)
Edmund B. Cronin, Jr., Chairman, President and CEO, stated, "In this economy,
our geographic focus, diversified real estate portfolio and conservative
balance sheet are serving us well. Our office and industrial properties have
been more adversely affected by the soft economy while the apartment and retail
portfolios are performing well. Furthermore WRIT's dividend remains very
secure."
WRIT is a self-administered, self-managed, equity real estate investment trust
investing in income-producing properties in the greater Washington-Baltimore
region. The Trust owns a diversified portfolio of 59 properties consisting of 11
retail centers, 24 office properties, 15 industrial and 9 multifamily
properties.
WRIT's dividends have increased every year for 32 consecutive years. WRIT shares
are publicly traded on the New York Stock Exchange (symbol: WRE).
Note: WRIT's press releases and supplemental financial information are available
on the company website at www.writ.com or by contacting Investor Relations at
301-984-9400.
Certain statements in this press release and the supplemental disclosures
attached hereto are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements involve known
and unknown risks, uncertainties and other factors that may cause actual results
to differ materially. Such risks, uncertainties and other factors included, but
are not limited to, fluctuations in interest rates, availability of raw
materials and labor costs, levels of competition, the effect of government
regulation, the availability of capital, weather, conditions, the timing and
pricing of lease transactions and changes in general and local economic and real
estate market conditions.
FOR IMMEDIATE RELEASE
Page 2 of 5 November 4, 2002
WASHINGTON REAL ESTATE INVESTMENT TRUST
FINANCIAL HIGHLIGHTS
(In thousands, except per share data)
Three Months Ended September 30, Nine Months Ended September 30,
OPERATING RESULTS 2002 2001 2002 2001
- ------------------------------------------------------- ---------------- ------------- --------------- -------------
Real estate rental revenue $ 38,324 $ 37,510 $ 113,903 $ 109,528
Real estate expenses (11,453) (10,732) (32,779) (31,475)
---------------- ------------- --------------- -------------
26,871 26,778 81,124 78,053
Real estate depreciation and amortization (7,303) (6,777) (21,305) (19,624)
---------------- ------------- --------------- -------------
Income from real estate 19,568 20,001 59,819 58,429
Other income 177 302 552 1,251
Interest expense (7,068) (6,731) (20,838) (20,178)
General and administrative (1,034) (1,303) (3,505) (4,541)
---------------- ------------- --------------- -------------
Income before sale of real estate investment 11,643 12,269 36,028 34,961
Gain on sale of real estate investment - 4,296 - 4,296
---------------- ------------- --------------- -------------
Income from continuing operations 11,643 16,565 36,028 39,257
Discontinued operations:
Income (loss) from operations of properties disposed - 259 (82) 690
Gain on property disposed - - 3,838 -
---------------- ------------- --------------- -------------
Net Income 11,643 16,824 39,784 39,947
================ ============= =============== =============
Real estate depreciation and amortization 7,303 6,777 21,305 19,624
Gain on sale of real estate investment - (4,296) - (4,296)
Divestiture sharing distribution - (22) - (537)
Discontinued operations:
Gain on property disposed - - (3,838) -
Real estate depreciation and amortization - 23 12 70
---------------- ------------- --------------- -------------
Funds From Operations 18,946 19,306 57,263 54,808
================ ============= =============== =============
Accretive:
Tenant Improvements (1,095) (820) (3,390) (2,609)
Leasing Conmissions Capitalized (258) (182) (922) (695)
Non-Accretive:
Recurring Capital Improvements (2,132) (1,233) (5,593) (3,841)
Straight Line Rents, Net of Reserve (338) (526) (1,364) (1,802)
Non Real Estate Depreciation & Amortization 491 430 1,495 1,340
Divestiture Sharing Distribution - 22 - 537
---------------- ------------- --------------- -------------
Funds Available for Distribution 15,614 16,997 47,489 47,738
================ ============= =============== =============
Accretive:
Major Renovations and Expansions (2,592) (321) (7,603) (494)
Acquisition - Related Capital Improvements (334) (1,111) (1,173) (1,981)
---------------- ------------- --------------- -------------
Net Funds Available for Distribution $ 12,688 $ 15,565 $ 38,713 $ 45,263
================ ============= =============== =============
FOR IMMEDIATEATE RELEASE
Page 3 of 5 November 4, 2002
WASHINGTON REAL ESTATE INVESTMENT TRUST
FINANCIAL HIGHLIGHTS
(In thousands, except per share data)
Three Months Ended September 30, Nine Months Ended September 30,
2002 2001 2002 2001
----------- ----------- ----------- -----------
Per Share Data
Income before sale of real estate investment (Basic) $ 0.30 $ 0.32 $ 0.92 $ 0.94
(Diluted) $ 0.30 $ 0.32 $ 0.92 $ 0.93
Gain on sale of real estate investment (Basic) $ 0.00 $ 0.11 $ 0.00 $ 0.11
(Diluted) $ 0.00 $ 0.11 $ 0.00 $ 0.11
Income (loss) from operations of properties disposed (Basic) $ 0.00 $ 0.01 $ 0.00 $ 0.02
(Diluted) $ 0.00 $ 0.00 $ 0.00 $ 0.02
Gain on property disposed (Basic) $ 0.00 $ 0.00 $ 0.10 $ 0.00
(Diluted) $ 0.00 $ 0.00 $ 0.09 $ 0.00
Net income (Basic) $ 0.30 $ 0.44 $ 1.02 $ 1.07
(Diluted) $ 0.30 $ 0.43 $ 1.0l $ 1.06
Funds From Operations (Basic) $ 0.48 $ 0.50 $ 1.47 $ 1.47
(Diluted) $ 0.48 $ 0.50 $ 1.46 $ 1.46
Funds Available for Distribution (Basic) $ 0.40 $ 0.44 $ 1.22 $ 1.28
(Diluted) $ 0.40 $ 0.44 $ 1.21 $ 1.27
Net Funds Available for Distribution (Basic) $ 0.32 $ 0.40 $ 0.99 $ 1.21
(Diluted) $ 0.32 $ 0.40 $ 0.99 $ 1.20
Dividends paid $ 0.3525 $ 0.3325 $ 1.0375 $ 0.9775
Weighted average shares outstanding 39,133,714 38,460,018 39,030,268 37,311,583
Fully diluted weighted average shares outstanding 39,358,143 38,795,143 39,265,168 37,618,006
Washington Real Estate Investment Trust
FOR IMMEDIATE RELEASE
Page 4 of 5
WASHINGTON REAL ESTATE INVESTMENT TRUST
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
September 30, December 31,
2002 2001
------------ ------------
Assets
Land $ 169,045 $ 151,782
Building 679,365 622,804
------------ ------------
Total real estate, at cost 848,410 774,586
Accumulated depreciation (139,965) (122,625)
------------ ------------
Total investment in real estate, net 708,445 651,961
Cash and cash equivalents 15,818 26,441
Rents and other receivables, net of allowance for doubtful
accounts of $2,400 and respectively $1,993, respectively 12,617 10,523
Prepaid expenses and other assets 21,083 19,010
------------ ------------
Total Assets $ 757,963 $ 707,935
============ ============
Liabilities
Accounts payable and other liabilities $ 11,869 $ 13,239
Advance rents 4,172 3,604
Tenant security deposits 6,442 6,148
Mortgage notes payable 87,197 94,726
Line of credit payable 53,750 -
Notes payable 265,000 265,000
------------ ------------
Total Liabilities 428,430 382,717
------------ ------------
Minority interest 1,554 1,611
------------ ------------
Shareholders' Equity
Shares of beneficial interest, $.01 par value; 100,000
shares authorized: 39,146 and 38,829 shares issued
and outstanding, respectively 391 388
Additional paid-in capital 328,387 323,257
Retained earnings (deficit) (799) (38)
------------ ------------
Total Shareholders' Equity 327,979 323,607
------------ ------------
Total Liabilities and Shareholders Equity $ 757,963 $ 707,935
============ ============
Debt Information as of 9/30/02
- ------------------------------
Debt to total Market Capitalization 29.0%
For the Quarter ended 9/30/02
- -----------------------------
Earnings to Fixed Charges /(1)/ 2.64
Debt Service Coverage Ratio 3.55
(1) (Income before sale of real estate / (interest expense + capitalized
interest + amortized costs of debt issuance))
Washington Real Estate Investment Trust
FOR IMMEDIATE RELEASE
Page 5 of 5
Core Portfolio & Overall Occupancy Levels by Sector
Core Portfolio All Properties
-------------- --------------
3rd QTR 3rd QTR 3rd QTR 3rd QTR
Sector 2002 2001 2002 2001
---- ---- ---- ----
Multifamily 94.6% 96.3% 94.6% 96.3%
Office Buildings 88.5% 97.2% 87.6% 97.1%
Retail Centers 94.9% 95.3% 95.1% 95.3%
Industrial/Flex Centers 91.9% 98.7% 93.0% 98.8%
---- ---- ---- ----
Overall Portfolio 90.9% 97.0% 90.7% 96.9%
Acquisitions
On July 24, 2002 WRIT acquired The Atrium Building in Rockville, MD for $14.2
million. The Atrium is a three-story office building containing 81,390 rentable
square feet of office space and on-site surface parking for 264 vehicles.
Currently, The Atrium is 46.2% occupied. The National Institute of Health has
leased 37,200 square feet effective October 1, 2002, which brings the building
to 94.1% leased.
REIT Industry Issues
In light of recent issues raised in the REIT industry, WRIT makes the following
disclosures:
1. WRIT has only nominal non-income producing land held for development
and no speculative construction in process.
2. WRIT has no capital investments in technology ventures or companies,
nor any other off balance sheet activities.
Conference Call Information
WRIT will conduct a Conference Call to discuss 3rd Quarter Earnings on Tuesday,
November 5, 2002 at 11:00 AM, Eastern Time. Conference call access information
is as follows:
USA Toll Free Number: 888-552-9191
International Toll Number: 630-395-0034
Pass Code: Washington REIT
Leader: Sara Grootwassink
The replay of the Conference Call will be available for two weeks, commencing
one hour after the Conference Call and concluding on November 19, 2002 at 5:00
PM Eastern Time. Instant Replay access information is as follows:
USA Toll Free Number: 800-834-5843
International Toll Number: 402-280-l653
The live on-demand webcast of the Conference Call will also be available on
WRIT's website at www.writ.com. The on-line playback of the webcast will be
available at www.writ.com for 30 days following the Conference Call.