Maryland | 1-10093 | 13-6908486 | ||
(State or other jurisdiction | (Commission | (IRS Employer | ||
of incorporation) | File Number) | Identification No.) |
31500 Northwestern Highway, Suite 300, Farmington Hills, Michigan | 48334 |
(Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code | (248) 350-9900 |
Item 8.01 | Other Events |
Item 9.01 | Financial Statements and Exhibits |
(a) | Financial Statements of Businesses Acquired |
Front Range Village | |
Report of Independent Certified Public Accountants | |
Statement of Revenues and Certain Expenses for the fiscal year ended June 30, 2014 | |
Notes to Statement of Revenues and Certain Expenses |
(b) | Unaudited Pro Forma Financial Information |
Ramco-Gershenson Properties Trust, Inc. | |
Pro Forma Condensed Consolidated Balance Sheet as of June 30, 2014 (unaudited) | |
Pro Forma Condensed Consolidated Statement of Operations for the six months ended June 30, 2014 (unaudited) | |
Notes and adjustments to Pro Forma Condensed Consolidated Statement of Operations for the six months ended June 30, 2014 (unaudited) | |
Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 2013 (unaudited) | |
Notes and adjustments to Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 2013 (unaudited) |
(d) | Exhibits. |
23.1 Consent of Independent Certified Public Accountants |
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS |
FRONT RANGE VILLAGE | ||||
STATEMENT OF REVENUES AND CERTAIN EXPENSES | ||||
(in thousands) | ||||
For the Fiscal Year Ended June 30, 2014 | ||||
REVENUES: | ||||
Minimum rent | $ | 8,414 | ||
Recovery income from tenants | 3,120 | |||
Other property income | 1,072 | |||
TOTAL REVENUES | 12,606 | |||
CERTAIN EXPENSES: | ||||
Real estate taxes | 2,117 | |||
Recoverable operating expense | 1,705 | |||
General and administrative | 298 | |||
TOTAL CERTAIN EXPENSES | 4,120 | |||
REVENUES IN EXCESS OF CERTAIN EXPENSES | $ | 8,486 | ||
See accompanying notes. |
1. | Business and Basis of Presentation |
2. | Summary of Significant Accounting Policies |
3. | Future Minimum Rental Income |
Year Ending June 30, | |||
(In thousands) | |||
2015 | $ | 8,040 | |
2016 | 7,960 | ||
2017 | 7,207 | ||
2018 | 6,580 | ||
2019 | 4,851 | ||
Thereafter | 13,360 | ||
Total | $ | 47,998 | |
RAMCO-GERSHENSON PROPERTIES TRUST | ||||||||||||
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET | ||||||||||||
June 30, 2014 | ||||||||||||
(In thousands, except per share amounts) | ||||||||||||
(unaudited) | ||||||||||||
Historical (1) | Acquisition and Pro Forma Allocations | Pro Forma | ||||||||||
ASSETS | ||||||||||||
Net real estate | $ | 1,468,381 | $ | 106,988 | (2) | $ | 1,575,369 | |||||
Equity investments in unconsolidated joint ventures | 28,663 | — | 28,663 | |||||||||
Cash and cash equivalents | 33,085 | (8,454 | ) | (3) (4) | 24,631 | |||||||
Restricted cash | 14,915 | — | 14,915 | |||||||||
Accounts receivable, net | 10,716 | — | 10,716 | |||||||||
Other assets, net | 118,139 | 26,552 | (2) | 144,691 | ||||||||
TOTAL ASSETS | $ | 1,673,899 | $ | 125,086 | $ | 1,798,985 | ||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||
Senior unsecured notes payable | $ | 420,000 | $ | — | $ | 420,000 | ||||||
Mortgages payable | 301,029 | — | 301,029 | |||||||||
Unsecured revolving credit facility | — | 120,000 | (4) | 120,000 | ||||||||
Junior subordinated notes | 28,125 | — | 28,125 | |||||||||
Capital lease obligation | 5,510 | — | 5,510 | |||||||||
Accounts payable and accrued expenses | 38,104 | — | 38,104 | |||||||||
Other liabilities | 46,631 | 5,290 | (2) | 51,921 | ||||||||
Distributions payable | 15,406 | — | 15,406 | |||||||||
TOTAL LIABILITIES | 854,805 | 125,290 | 980,095 | |||||||||
Commitments and Contingencies | ||||||||||||
Ramco-Gershenson Properties Trust ("RPT") Shareholders' Equity: | ||||||||||||
Preferred shares, $0.01 par, 2,000 shares authorized: 7.25% Series D | $ | 100,000 | $ | — | $ | 100,000 | ||||||
Cumulative Convertible Perpetual Preferred Shares, (stated at liquidation preference $50 per share), 2,000 shares | ||||||||||||
issued and outstanding as of June 30, 2014 | ||||||||||||
Common shares of beneficial interest, $0.01 par, 120,000 shares authorized, 69,937 shares issued and outstanding as of June 30, 2014 | 699 | — | 699 | |||||||||
Additional paid-in capital | 1,008,913 | — | 1,008,913 | |||||||||
Accumulated distributions in excess of net income | (315,668 | ) | (204 | ) | (3) | (315,872 | ) | |||||
Accumulated other comprehensive loss | (1,925 | ) | — | (1,925 | ) | |||||||
TOTAL SHAREHOLDERS' EQUITY ATTRIBUTABLE TO RPT | 792,019 | (204 | ) | 791,815 | ||||||||
Noncontrolling interest | 27,075 | — | 27,075 | |||||||||
TOTAL SHAREHOLDERS' EQUITY | 819,094 | (204 | ) | 818,890 | ||||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 1,673,899 | $ | 125,086 | $ | 1,798,985 | ||||||
The accompanying notes are an integral part of these consolidated financial statements. |
(In thousands) | ||||
Net real estate | $ | 106,988 | ||
Other assets | 26,552 | |||
Other liabilities | (5,290 | ) | ||
Total purchase price allocated | $ | 128,250 | ||
(3) | Represents acquisition costs related to Front Range Village not included in the historical balance sheet. |
RAMCO-GERSHENSON PROPERTIES TRUST | |||||||||||||||
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
FOR THE SIX MONTHS ENDED JUNE 30, 2014 | |||||||||||||||
(In thousands, except per share amounts) | |||||||||||||||
(Unaudited) | |||||||||||||||
Historical (1) | Front Range Village (2) | Pro Forma Adjustments | Pro Forma | ||||||||||||
REVENUE | |||||||||||||||
Minimum rent | $ | 73,321 | $ | 4,062 | $ | 144 | (3) | $ | 77,527 | ||||||
Percentage rent | 153 | — | — | 153 | |||||||||||
Recovery income from tenants | 24,104 | 1,622 | — | 25,726 | |||||||||||
Other property income | 1,539 | 534 | — | 2,073 | |||||||||||
Management and other fee income | 946 | — | — | 946 | |||||||||||
TOTAL REVENUE | 100,063 | 6,218 | 144 | 106,425 | |||||||||||
EXPENSES | |||||||||||||||
Real estate taxes | 14,714 | 1,059 | — | 15,773 | |||||||||||
Recoverable operating expense | 11,898 | 840 | — | 12,738 | |||||||||||
Other non-recoverable operating expense | 1,684 | — | — | 1,684 | |||||||||||
Depreciation and amortization | 41,399 | — | 2,133 | (4) | 43,532 | ||||||||||
General and administrative expense | 11,233 | 150 | — | 11,383 | |||||||||||
TOTAL EXPENSES | 80,928 | 2,049 | 2,133 | 85,110 | |||||||||||
OPERATING INCOME (LOSS) | 19,135 | 4,169 | (1,989 | ) | 21,315 | ||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||
Other expense, net | (372 | ) | — | — | (372 | ) | |||||||||
Gain on sale of real estate | 2,672 | — | — | 2,672 | |||||||||||
Loss from unconsolidated joint ventures | (791 | ) | — | — | (791 | ) | |||||||||
Interest expense | (15,231 | ) | — | (1,080 | ) | (5) | (16,311 | ) | |||||||
Amortization of deferred financing fees | (773 | ) | — | — | (773 | ) | |||||||||
Deferred gain recognized | 117 | — | — | 117 | |||||||||||
Loss on extinguishment of debt | (860 | ) | — | — | (860 | ) | |||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAX | 3,897 | 4,169 | (3,069 | ) | 4,997 | ||||||||||
Income tax provision | (16 | ) | — | — | (16 | ) | |||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | 3,881 | 4,169 | (3,069 | ) | 4,981 | ||||||||||
NET INCOME (LOSS) | 3,881 | 4,169 | (3,069 | ) | 4,981 | ||||||||||
Net income attributable to noncontrolling partner interest | (123 | ) | — | — | (123 | ) | |||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO RPT | 3,758 | 4,169 | (3,069 | ) | 4,858 | ||||||||||
Preferred share dividends | (3,625 | ) | — | — | (3,625 | ) | |||||||||
NET INCOME (LOSS)AVAILABLE TO COMMON SHAREHOLDERS | $ | 133 | $ | 4,169 | $ | (3,069 | ) | $ | 1,233 | ||||||
EARNINGS PER COMMON SHARE (6) | |||||||||||||||
Continuing operations - basic | $ | — | $ | 0.02 | |||||||||||
Continuing operations - diluted | $ | — | $ | 0.02 | |||||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | |||||||||||||||
Basic | 67,966 | 67,966 | |||||||||||||
Diluted | 68,209 | 68,209 | |||||||||||||
See accompanying notes. |
(1) | Represents the condensed consolidated continuing operations of the Registrant for the six months ended June 30, 2014. Refer to the historical condensed consolidated financial statements and notes thereto presented in the Registrant’s Quarterly Report on Form 10-Q for the six months ended June 30, 2014. |
(2) | Represents the revenues and certain expenses of Front Range Village for the six months ended June 30, 2014. This is not intended to be a complete presentation of the revenues and expenses of Front Range Village. Certain expenses, primarily depreciation and amortization, and other costs not directly related to the future operations of the property have been excluded. |
(3) | Represents the net adjustments to record tenant rents on a straight-line basis from the assumed acquisition date and the amortization of above and below market leases over the remaining term of the in-place leases. |
(4) | Represents the estimated depreciation and amortization of the acquired assets on a straight-line basis. Tenant improvements and the value of in-place leases are depreciated over the remaining lives of the related leases. Buildings are depreciated over the estimated remaining useful lives which are 40 years. Site improvements are depreciated over 10-30 years. Lease origination costs are amortized over the remaining useful life of the leases. |
(5) | Represents the increase in interest expense due to an increase in borrowing under our unsecured revolving credit facility to fund a portion of the acquisition of Front Range Village. The assumed interest rate used is 1.8%, which is the same as the interest rate on our unsecured line of credit as of June 30, 2014. |
(6) | Earnings per share is calculated in accordance with Accounting Standards Codification 260 – “Earnings per Share.” The historical earnings per share amounts are the amounts reported in the Registrant’s Form 10-Q for the six months ended June 30, 2014. |
RAMCO-GERSHENSON PROPERTIES TRUST | |||||||||||||||
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
FOR THE YEAR ENDED DECEMBER 31, 2013 | |||||||||||||||
(In thousands, except per share amounts) | |||||||||||||||
(Unaudited) | |||||||||||||||
Historical (1) | Front Range Village (2) | Pro Forma Adjustments | Pro Forma | ||||||||||||
REVENUE | |||||||||||||||
Minimum rent | $ | 124,169 | $ | 7,805 | $ | 574 | (3) | $ | 132,548 | ||||||
Percentage rent | 209 | — | — | 209 | |||||||||||
Recovery income from tenants | 40,018 | 3,043 | — | 43,061 | |||||||||||
Other property income | 3,337 | 1,039 | — | 4,376 | |||||||||||
Management and other fee income | 2,335 | — | — | 2,335 | |||||||||||
TOTAL REVENUE | 170,068 | 11,887 | 574 | 182,529 | |||||||||||
EXPENSES | |||||||||||||||
Real estate taxes | 23,161 | 2,116 | — | 25,277 | |||||||||||
Recoverable operating expense | 20,194 | 1,573 | — | 21,767 | |||||||||||
Other non-recoverable operating expense | 3,006 | — | — | 3,006 | |||||||||||
Depreciation and amortization | 56,305 | — | 4,265 | (4) | 60,570 | ||||||||||
General and administrative expense | 22,273 | 208 | — | 22,481 | |||||||||||
TOTAL EXPENSES | 124,939 | 3,897 | 4,265 | 133,101 | |||||||||||
OPERATING INCOME | 45,129 | 7,990 | (3,691 | ) | 49,428 | ||||||||||
OTHER INCOME AND EXPENSES | |||||||||||||||
Other expense, net | (965 | ) | — | — | (965 | ) | |||||||||
Gain on sale of real estate | 4,279 | — | — | 4,279 | |||||||||||
Loss from unconsolidated joint ventures | (4,759 | ) | — | — | (4,759 | ) | |||||||||
Interest expense | (29,075 | ) | — | (2,160 | ) | (5) | (31,235 | ) | |||||||
Amortization of deferred financing fees | (1,447 | ) | — | — | (1,447 | ) | |||||||||
Provision for impairment | (9,669 | ) | — | — | (9,669 | ) | |||||||||
Deferred gain on real estate | 5,282 | — | — | 5,282 | |||||||||||
Loss on early extinguishment of debt | (340 | ) | — | — | (340 | ) | |||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAX | 8,435 | 7,990 | (5,851 | ) | 10,574 | ||||||||||
Income tax provision | (64 | ) | — | — | (64 | ) | |||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | 8,371 | 7,990 | (5,851 | ) | 10,510 | ||||||||||
NET INCOME (LOSS) | 8,371 | 7,990 | (5,851 | ) | 10,510 | ||||||||||
Net income attributable to noncontrolling partner interest | (355 | ) | — | — | (355 | ) | |||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO RPT | 8,016 | 7,990 | (5,851 | ) | 10,155 | ||||||||||
Preferred share dividends | (7,250 | ) | — | — | (7,250 | ) | |||||||||
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | $ | 766 | $ | 7,990 | $ | (5,851 | ) | $ | 2,905 | ||||||
EARNINGS PER COMMON SHARE (6) | |||||||||||||||
Continuing operations - basic | $ | 0.01 | $ | 0.05 | |||||||||||
Continuing operations - diluted | $ | 0.01 | $ | 0.05 | |||||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | |||||||||||||||
Basic | 59,336 | 59,336 | |||||||||||||
Diluted | 59,728 | 59,728 | |||||||||||||
See accompanying notes. |
(1) | Represents the condensed consolidated continuing operations of the Registrant for the year ended December 31, 2013. Revenues and expenses related to discontinued operations are not included. Refer to the historical consolidated financial statements and notes thereto presented in the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2013. |
(2) | Represents the revenues and certain expenses of Front Range Village for the year ended December 31, 2013. This is not intended to be a complete presentation of the revenues and expenses of Front Range Village. Certain expenses, primarily depreciation and amortization, and other costs not directly related to the future operations of the property have been excluded. |
(3) | Represents the net adjustments to record tenant rents on a straight-line basis from the assumed acquisition date over the remaining term of the in-place leases. |
(4) | Represents the estimated depreciation and amortization of the acquired assets on a straight-line basis. Tenant improvements and the value of in-place leases are depreciated over the remaining lives of the related leases. Buildings are depreciated over the estimated remaining useful lives which are 40 years. Site improvements are depreciated over 10-30 years. |
(5) | Represents the increase in interest expense due to an increase in borrowing under our unsecured revolving credit facility to fund a portion of the Front Range Village acquisition. The assumed interest rate used is 1.8%, which is the same as the interest rate on our unsecured line of credit as of December 31, 2013. |
(6) | Earnings per share is calculated in accordance with Accounting Standards Codification 260 – “Earnings per Share”, which requires the allocation of non-controlling interest between continuing and discontinued operations. The historical earnings per share amounts are the amounts reported in the Registrant’s Form 10-K for the year ended December 31, 2013. |
RAMCO-GERSHENSON PROPERTIES TRUST | |||
Date: | September 24, 2014 | By: | /s/ GREGORY R. ANDREWS |
Gregory R. Andrews | |||
Chief Financial Officer and Secretary |
Exhibit | Description |
23.1 | Consent of Independent Certified Public Accountants |