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CUPERTINO, Calif., April 15 /PRNewswire-FirstCall/ -- Mission West Properties, Inc. (Nasdaq: MSW | Quote | Chart | News | PowerRating) reported today that Funds From Operations ("FFO") for the quarter ended March 31, 2009 was approximately $12,070,000, or $0.11 per diluted common share, (considering the potential effect of all O.P. units being exchanged for shares of the Company's common stock) as compared to approximately $15,223,000, or $0.14 per diluted common share, for the same period in 2008. Unrealized loss from investment in marketable securities accounted for approximately ($2,757,000), or ($0.03) per diluted common share, for the quarter ended March 31, 2009. On a sequential quarter basis, FFO for the quarter ended December 31, 2008 was approximately $0.12 per diluted common share. Net termination fee income relating to a lease termination accounted for approximately $1,921,000, or $0.02 per diluted common share, for the quarter ended March 31, 2008.
Net income for the quarter ended March 31, 2009 was approximately $5,634,000 as compared to approximately $9,121,000 for the quarter ended March 31, 2008. Net income per diluted share to common stockholders was $0.07 for the quarter ended March 31, 2009 compared to $0.10 for the quarter ended March 31, 2008, a per share decrease of approximately 30%. Unrealized loss from investment in marketable securities accounted for approximately ($0.03) per diluted common share for the quarter ended March 31, 2009. Net termination fee income relating to a lease termination accounted for approximately $0.02 per diluted common share for the quarter ended March 31, 2008.
Company Profile
Mission West Properties, Inc. operates as a self-managed, self-administered and fully integrated REIT engaged in the management, leasing, marketing, development and acquisition of commercial R&D properties, primarily located in the Silicon Valley portion of the San Francisco Bay Area. Currently, the Company manages 111 properties totaling approximately 8.0 million rentable square feet, which includes approximately 854,000 rentable square feet (or 16 buildings) that are in the process of being rezoned for residential development. For additional information, please contact Investor Relations at 408-725-0700.
The matters described herein contain forward-looking statements. Such statements can be identified by the use of forward-looking terminology such as "will," "anticipate," "estimate," "expect," "intends," or similar words. Forward-looking statements involve a number of risks, uncertainties or other factors beyond the Company's control, which may cause material differences in actual results, performance or other expectations. These factors include, but are not limited to, the ability to complete acquisitions under the Berg Land Holdings Option Agreement with the Berg Group and other factors detailed in the Company's registration statements, and periodic filings with the Securities & Exchange Commission.
MISSION WEST PROPERTIES, INC.
SELECTED FINANCIAL DATA
(In thousands, except share, per share and property data amounts)
Three Months Three Months
Ended Ended
Mar 31, 2009 Mar 31, 2008
------------ ------------
OPERATING REVENUES:
Rental revenue from real estate $20,655 $18,996
Tenant reimbursements 4,800 3,583
Lease termination and settlement
income - 1,921
Other income 320 228
------------ ------------
Total operating revenues 25,775 24,728
------------ ------------
OPERATING EXPENSES:
Operating and maintenance 2,555 2,476
Real estate taxes 3,397 2,411
General and administrative 531 673
Depreciation and amortization of 5,944 (1) 5,623(1)
real estate
------------ ------------
Total operating expenses 12,427 11,183
------------ ------------
Operating income 13,348 13,545
OTHER INCOME (EXPENSES):
Equity in earnings of
unconsolidated joint venture 89 382
Interest and dividend income (59) 558
Unrealized loss from investment (2,757) -
Interest expense (4,806) (4,928)
Interest expense - related
parties (181) (436)
------------ ------------
Net income 5,634 9,121
Net income attributable to
noncontrolling interests (4,202) (7,239)
------------ ------------
Net income attributable to common
stockholders $1,432 $1,882
============ ============
Net income per share to common
stockholders:
Basic $0.07 $0.10
============ ============
Diluted $0.07 $0.10
============ ============
Weighted average shares of common
stock (basic) 21,614,878 19,667,605
============ ============
Weighted average shares of common
stock (diluted) 21,770,489 19,667,605
============ ============
Weighted average O.P. units
outstanding 83,660,298 85,530,417
============ ============
FUNDS FROM OPERATIONS
Funds from operations $12,070 $15,223
============ ============
Funds from operations per share (2) $0.11 $0.14
============ ============
Outstanding common stock 21,748,211 19,669,807
============ ============
Outstanding O.P. units 83,526,965 85,528,215
============ ============
Weighted average O.P. units and
common stock
outstanding (diluted) 105,430,787 105,198,022
============ ============
Three Months Three Months
Ended Ended
FUNDS FROM OPERATIONS CALCULATION Mar 31, 2009 Mar 31, 2008
------------ ------------
Net income $5,634 $9,121
Add:
Depreciation and amortization of
real estate 6,416 6,024
Depreciation and amortization of real
estate held in unconsolidated
joint venture 59 189
Less:
Noncontrolling interests in joint
ventures (39) (111)
------------ ------------
Funds from operations $12,070 $15,223
============ ============
Funds From Operations ("FFO") is a non-GAAP financial measurement
used by real estate investment trusts ("REITs") to measure and
compare operating performance. As defined by NAREIT, FFO represents
net income (loss) before noncontrolling interest of unit holders
(computed in accordance with GAAP, accounting principles generally
accepted in the United States of America), excluding gains (or
losses) from debt restructuring and sales of property, plus real
estate related depreciation and amortization (excluding amortization
of deferred financing costs and depreciation of non-real estate
assets) and after adjustments for unconsolidated partnerships and
joint ventures. Management considers FFO to be an appropriate
supplemental measure of the Company's operating and financial
performance because when compared year over year, it reflects the
impact to operations from trends in occupancy rates, rental rates,
operating costs, general and administrative expenses and interest
costs, providing a perspective not immediately apparent from net
income. In addition, management believes that FFO provides useful
information about the Company's financial performance when compared
to other REITs since FFO is generally recognized as the industry
standard for reporting the operations of REITs. FFO should neither
be considered as an alternative for net income as a measure of
profitability nor is it comparable to cash flows provided by
operating activities determined in accordance with GAAP. FFO is not
comparable to similarly entitled items reported by other REITs that
do not define them exactly as we define FFO.
Three Months Three Months
Ended Ended
Mar 31, 2009 Mar 31, 2008
------------ ------------
PROPERTY AND OTHER DATA:
Total properties, end of period 111 111
Total square feet, end of period 8,047,569 8,047,569
Average monthly rental revenue
per square foot (3) $1.29 $1.23
Occupancy for leased properties 65.3% 64.4%
Straight-line rent $322 $705
Leasing commissions $117 $316
Capital expenditures $- $221
Lease Rollover Schedule:
Year # of Rentable Square
Leases Feet
---------- ------- --------------
2009 15 140,332 (4)
2010 12 572,000
2011 15 827,605
2012 13 1,001,452
2013 6 459,737
2014 13 1,357,782
2015 4 328,211
2016 2 144,600
2017 3 241,089
Thereafter 1 119,756
------- --------------
Total 84 5,192,564
======= ==============
BALANCE SHEETS
March 31, December 31,
2009 2008
------------ ------------
Assets
Investments in real estate:
Land $320,911 $320,911
Buildings and improvements 799,469 799,471
Real estate related intangible assets 3,240 3,240
------------ ------------
Total investments in
properties 1,123,620 1,123,622
Accumulated depreciation and
amortization (185,987) (180,043)
------------ ------------
Net investments in properties 937,633 943,579
Investment in unconsolidated
joint venture 3,832 3,768
------------ ------------
Net investments in real estate 941,465 947,347
Cash and cash equivalents - -
Restricted cash 22,048 39,478
Restricted investment in
marketable securities 4,078 -
Investment in marketable securities - 3,368
Deferred rent receivables 18,164 17,841
Other assets, net 18,620 18,758
------------ ------------
Total assets $1,004,375 $1,026,792
============ ============
Liabilities and Equity
Liabilities:
Mortgage notes payable $327,933 $330,908
Mortgage note payable -
related parties 8,639 8,761
Revolving line of credit 5,456 13,079
Interest payable 1,583 1,596
Security deposits 5,122 5,272
Deferred rental income 5,735 3,964
Dividends and distributions
payable 21,055 21,055
Accounts payable and accrued expenses 20,063 17,747
------------ ------------
Total liabilities 395,586 402,382
------------ ------------
Commitments and contingencies.
Equity: (5)
Stockholders' equity:
Common stock, $.001 par value 22 20
Additional paid-in capital 169,415 154,412
Distributions in excess of
accumulated earnings (22,932) (20,014)
------------ ------------
Total stockholders' equity 146,505 134,418
Noncontrolling interests 462,284 489,992
------------ ------------
Total equity 608,789 624,410
------------ ------------
Total liabilities and equity $1,004,375 $1,026,792
============ ============
------------------------------------------------------------------------
(1) Includes approximately $159 and $122 in amortization expense for the
three months ended March 31, 2009 and 2008, respectively, for the
amortization of in-place lease value intangible asset pursuant to
Statement of Financial Accounting Standard No. 141, "Business
Combinations."
(2) Calculated on a fully diluted basis. Assumes conversion of O.P. units
outstanding into the Company's common stock.
(3) Average monthly rental revenue per square foot has been determined by
taking the cash base rent for the period divided by the number of
months in the period, and then divided by the average occupied square
feet in the period.
(4) Eight leases for approximately 113,000 rentable square feet are month
to month lease.
(5) Reflects adoption of Statement of Financial Accounting Standard No.
160, "Noncontrolling Interests in Consolidated Financial Statements -
an amendment of ARB No. 51."
SOURCE Mission West Properties, Inc.
http://www.missionwest.com
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