SAN DIEGO, July 28, 2010 /PRNewswire via COMTEX/ --
BioMed Realty Trust, Inc.
(NYSE:BMR)
, a real estate investment trust focused on Providing Real Estate to the Life Science Industry(R), today announced financial results for the second quarter ended June 30, 2010.
Second Quarter 2010 Highlights
Generated total revenues for the second quarter of $92.9 million, up 7.9% from $86.1 million in the same period in 2009.
Rental revenues for the second quarter increased 10.1% to $72.4 million from $65.7 million in the same period in 2009.
Increased same property net operating income for the quarter by 3.5% on a cash basis as compared to the same period in 2009.
Generated funds from operations (FFO) for the quarter of $0.28 per diluted share, or $31.4 million.
Executed twelve leasing transactions representing approximately 160,000 square feet:
Nine new leases totaling approximately 126,500 square feet.
Three leases amended to extend their terms, totaling approximately 33,500 square feet.
Increased the current operating portfolio weighted average leased percentage to 89.1% at June 30, 2010.
Acquired five life science buildings 100% leased to the J. Craig Venter Institute comprising approximately 218,000 square feet in Rockville, Maryland.
Acquired a 100% leased life science building comprising approximately 57,000 square feet in Gaithersburg, Maryland.
Broke ground on a new 176,000 square foot, build-to-suit research facility for Isis Pharmaceuticals, Inc.
Received investment grade corporate credit ratings from Standard & Poor's Ratings Services and Moody's Investors Service.
Completed a follow-on public offering of common stock, raising approximately $218.8 million in net proceeds.
Completed a private placement of $250.0 million of 6.125% unsecured senior notes due 2020 at 98.977% of face value.
Voluntarily prepaid the $150.0 million remaining balance of the $250.0 million secured term loan, resulting in a loss on extinguishment of debt of approximately $860,000.
Repurchased approximately $18.0 million principal amount of exchangeable senior notes due 2026 at 100.3% of par, resulting in a loss on extinguishment of debt of approximately $584,000.
Promoted Greg Lubushkin to Chief Financial Officer.
Alan D. Gold, BioMed's Chairman and Chief Executive Officer, remarked, "BioMed experienced another very strong operating and financial quarter on the strength of higher rental revenues, driven by our premier tenant base and the expansion of our footprint in the core life science markets through selective acquisitions. Our life science real estate investment activity throughout the first half of 2010 has added over 500,000 square feet to our portfolio and forged long-term real estate partnerships with prominent life science organizations, including the J. Craig Venter Institute, a world-renowned life science research institution, MedImmune, a wholly-owned subsidiary of AstraZeneca, and Ocimum Biosolutions, a dynamic integrated genomics company."
Second Quarter Financial Results
Total revenues for the second quarter were $92.9 million, compared to $86.1 million for the same period in 2009, an increase of 7.9%. Rental revenues for the second quarter were $72.4 million, compared to $65.7 million for the same period in 2009, an increase of 10.1% and the highest in the company's history.
The current operating portfolio weighted average leased percentage increased to 89.1% as of June 30, 2010 from 88.0% as of March 31, 2010. The same property portfolio increased to 88.2% leased as of June 30, 2010. Same property net operating income on a cash basis increased 3.5% for the quarter compared to the same period in 2009. Excluding four properties for which lease terminations resulted in the company recognizing $10.3 million of other income during 2009, same property net operating income on a cash basis increased 4.2%, primarily as a result of contractual rent escalations.
Net income available to common stockholders for the second quarter was $4.2 million, or $0.04 per diluted share, compared to $18.2 million, or $0.20 per diluted share, for the same period in 2009. FFO for the quarter was $31.4 million, or $0.28 per diluted share, compared to $44.0 million, or $0.48 per diluted share, for the same period in 2009.
FFO is a supplemental non-GAAP financial measure used in the real estate industry to measure and compare the operating performance of real estate companies. A complete reconciliation containing adjustments from GAAP net income available to common stockholders to FFO and a definition of FFO are included at the end of this release.
Financing Activity
At June 30, 2010, the company's debt to total assets ratio was 37.4%, the lowest since September 30, 2005. During the second quarter, the company completed the following financing transactions:
Completed a follow-on public offering of common stock, raising approximately $218.8 million in net proceeds.
Completed a private placement of $250.0 million of 6.125% unsecured senior notes due 2020 at 98.977% of face value.
Voluntarily prepaid the $150.0 million remaining balance of the $250.0 million secured term loan, resulting in a loss on extinguishment of debt of $860,000.
Repurchased approximately $18.0 million principal amount of exchangeable senior notes due 2026 at 100.3% of par, resulting in a loss on extinguishment of debt of $584,000.
"During the first half of 2010, BioMed successfully executed over $650 million in capital raising transactions designed to further strengthen our balance sheet, enhance our liquidity and position the company for future growth," said Kent Griffin, BioMed's President. "Bolstered by our investment grade corporate credit ratings, we completed a $219 million follow-on common stock offering and a $250 million unsecured debt issuance, and repaid the balance of our $250 million secured term loan during the quarter. Our prudent, measured steps over the past few quarters to provide BioMed with the liquidity and financial flexibility to pursue attractive investment opportunities have now begun to produce tangible results, as demonstrated by the investment activity throughout the first half and into the third quarter of 2010."
Portfolio Update
During the quarter ended June 30, 2010, the company acquired five life science buildings comprising approximately 218,000 square feet located at 9704-9714 Medical Center Drive in Rockville, Maryland, which are 100% leased to the J. Craig Venter Institute, a world leader in genomic research. In addition, BioMed acquired a life science building comprising approximately 57,000 square feet located at 50 West Watkins Mill Road in Gaithersburg, Maryland, which is 100% leased to Ocimum Biosolutions, an integrated genomics company.
The company executed twelve leasing transactions during the quarter representing approximately 160,000 square feet, comprised of:
Nine new leases totaling approximately 126,500 square feet, including:
50,000 square foot lease with Soraa, Inc. at the company's Kaiser Drive property in Fremont, California.
35,300 square foot lease with Benten BioServices, Inc. at the company's Phoenixville Pike property in Malvern, Pennsylvania.
15,200 square foot lease to Sierra Atlantic, Inc. at the company's Pacific Research Center in Newark, California.
Three leases amended to extend their terms, totaling approximately 33,500 square feet, including a 17,900 square foot lease extension with MedImmune, LLC at the Bridgeview Technology Park in Hayward, California.
As of June 30, 2010, BioMed owned or had interests in 120 buildings, located predominantly in the major U.S. life science markets of Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania and New York/New Jersey. As of June 30, 2010, the company had 129 tenants.
The company's property portfolio included the following as of June 30, 2010:
Rentable
Square
Feet
------
Current operating 9,044,685
Long-term lease up 1,389,517
Development 456,000
Pre-development 152,145
-------
Total portfolio 11,042,347
----------
Land parcels 1,577,000
---------
Total portfolio 12,619,347
After the quarter's end, the company completed the acquisitions of the following properties:
Acquired the 4775 and 4785 Executive Drive property in San Diego, California, for approximately $27.2 million which encompasses a development site representing approximately 166,000 square feet, including a newly constructed life science building comprising approximately 63,000 square feet and a land parcel with plans and permits in place for a second building totaling approximately 103,000 square feet.
Acquired a 100% leased life science building comprising approximately 61,600 square feet located at 3500 Paramount Parkway in Morrisville, North Carolina for approximately $17.5 million.
Quarterly and Annual Distributions
BioMed's board of directors previously declared a second quarter 2010 dividend of $0.15 per share of common stock, and a dividend of $0.46094 per share of the company's 7.375% Series A Cumulative Redeemable Preferred Stock for the period from April 16, 2010 through July 15, 2010. The second quarter common share dividend represented a 7.1% increase over the first quarter 2010 dividend and is equivalent to an annualized dividend of $0.60 per common share.
Earnings Guidance
The company has revised its 2010 guidance for net income per diluted share and FFO per diluted share based on the strong second quarter results. The company's revised guidance is set forth and reconciled below, which is based upon estimated, weighted-average diluted common shares outstanding of 112.4 million for the full year.
2010
(Low - High)
Projected net income per diluted share available
to common stockholders $0.16 - $0.21
Add:
Noncontrolling interests in operating partnership $0.01
Real estate depreciation and amortization $0.98
Projected FFO per diluted share $1.15 - $1.20
Consistent with the company's previously issued 2010 guidance, the revised guidance does not include any assumptions related to future financing or investing activities beyond announced transactions, nor does it include the impact of the potential conversion of the company's exchangeable senior notes.
The foregoing estimates are forward-looking and reflect management's view of current and future market conditions, including certain assumptions with respect to leasing activity, rental rates, occupancy levels, interest rates, and the amount and timing of development and redevelopment activities. The company's actual results may differ materially from these estimates.
Supplemental Information
Supplemental operating and financial data, as well as the updated Investor Presentation, are available in the Investor Relations section of the company's website at www.biomedrealty.com.
Teleconference and Webcast
BioMed will conduct a conference call and webcast at 10:00 a.m. Pacific Time (1:00 p.m. Eastern Time) on Thursday, July 29, 2010 to discuss the company's financial results and operations for the quarter. The call will be open to all interested investors either through a live audio web cast at the Investor Relations section of the company's web site at www.biomedrealty.com and at www.earnings.com, which will include an online slide presentation to accompany the call, or live by calling 866.202.3109 (domestic) or 617.213.8844 (international) with call ID number 69157118. The complete webcast will be archived for 30 days on both web sites. A telephone playback of the conference call will also be available from 1:00 p.m. Pacific Time on Thursday, July 29, 2010 until midnight Pacific Time on Tuesday, August 3, 2010 by calling 888.286.8010 (domestic) or 617.801.6888 (international) and using access code 42564902.
About BioMed Realty Trust
BioMed Realty Trust, Inc. is a real estate investment trust (REIT) focused on Providing Real Estate to the Life Science Industry(R). The company's tenants primarily include biotechnology and pharmaceutical companies, scientific research institutions, government agencies and other entities involved in the life science industry. BioMed owns or has interests in 75 properties, representing 122 buildings with approximately 11.2 million rentable square feet. The company's properties are located predominantly in the major U.S. life science markets of Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania and New York/New Jersey, which have well-established reputations as centers for scientific research. Additional information is available at www.biomedrealty.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, without limitation: general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, dependence on tenants' financial condition, and competition from other developers, owners and operators of real estate); adverse economic or real estate developments in the life science industry or the company's target markets; risks associated with the availability and terms of financing, the use of debt to fund acquisitions and developments, and the ability to refinance indebtedness as it comes due; failure to maintain the company's investment grade credit ratings with the ratings agencies; failure to manage effectively the company's growth and expansion into new markets, or to complete or integrate acquisitions and developments successfully; reductions in asset valuations and related impairment charges; risks and uncertainties affecting property development and construction; risks associated with downturns in the national and local economies, increases in interest rates, and volatility in the securities markets; potential liability for uninsured losses and environmental contamination; risks associated with the company's potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended, and possible adverse changes in tax and environmental laws; and risks associated with the company's dependence on key personnel whose continued service is not guaranteed. For a further list and description of such risks and uncertainties, see the reports filed by the company with the Securities and Exchange Commission, including the company's most recent annual report on Form 10-K and quarterly reports on Form 10-Q. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
(Financial Tables Follow)
BIOMED REALTY TRUST, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
June December
30, 31,
2010 2009
---- ----
(Unaudited)
ASSETS
Investments
in
real
estate,
net $3,075,150 $2,971,767
Investments
in
unconsolidated
partnerships 59,459 56,909
Cash
and
cash
equivalents 21,339 19,922
Restricted
cash 11,547 15,355
Accounts
receivable,
net 2,859 4,135
Accrued
straight-
line
rents,
net 96,298 82,066
Acquired
above-
market
leases,
net 2,436 3,047
Deferred
leasing
costs,
net 80,373 83,274
Deferred
loan
costs,
net 12,825 8,123
Other
assets 65,935 38,676
------ ------
Total
assets $3,428,221 $3,283,274
========== ==========
LIABILITIES AND EQUITY
Mortgage
notes
payable,
net $664,867 $669,454
Secured
term
loan - 250,000
Exchangeable
senior
notes
due
2026,
net 21,396 44,685
Exchangeable
senior
notes
due
2030 180,000 -
Unsecured
senior
notes
due
2020,
net 247,475 -
Unsecured
line
of
credit 170,500 397,666
Security
deposits 10,352 7,929
Dividends
and
distributions
payable 21,728 18,531
Accounts
payable,
accrued
expenses,
and
other
liabilities 50,720 47,388
Derivative
instruments 6,631 12,551
Acquired
below-
market
leases,
net 9,039 11,138
----- ------
Total
liabilities 1,382,708 1,459,342
Equity:
Stockholders'
equity:
Preferred
stock,
$.01
par
value,
15,000,000
shares
authorized:
7.375%
Series
A
cumulative
redeemable
preferred
stock,
$230,000,000
liquidation
preference
($25.00 per share),
9,200,000
shares
issued
and
outstanding
at
June
30,
2010
and
December
31,
2009 222,413 222,413
Common
stock,
$.01
par
value,
150,000,000
shares
authorized 1,136 990
and
113,578,209
and
99,000,269
shares
issued
and
outstanding
at
June
30,
2010
and
December
31,
2009,
respectively
Additional
paid-
in
capital 2,079,153 1,843,551
Accumulated
other
comprehensive
loss (77,049) (85,183)
Dividends
in
excess
of
earnings (190,010) (167,429)
-------- --------
Total
stockholders'
equity 2,035,643 1,814,342
Noncontrolling
interests 9,870 9,590
----- -----
Total
equity 2,045,513 1,823,932
--------- ---------
Total
liabilities
and
equity $3,428,221 $3,283,274
========== ==========
BIOMED REALTY TRUST, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share data)
(Unaudited)
For the Three
Months
June 30,
--------
2010 2009
---- ----
Revenues:
Rental $72,380 $65,716
Tenant recoveries 20,273 17,189
Other income 259 3,175
--- -----
Total revenues 92,912 86,080
------ ------
Expenses:
Rental operations 17,077 14,661
Real estate taxes 8,703 7,613
Depreciation and
amortization 26,469 24,501
General and administrative 6,449 5,126
Acquisition related
expenses 1,819 -
----- ---
Total expenses 60,517 51,901
------ ------
Income from operations 32,395 34,179
Equity in net loss of
unconsolidated
partnerships (100) (465)
Interest income 51 101
Interest expense (21,870) (12,875)
(Loss)/gain on derivative
instruments (497) 360
(Loss)/gain on
extinguishment of debt (1,444) 1,781
------ -----
Net income 8,535 23,081
Net income attributable to
noncontrolling interests (95) (645)
--- ----
Net income attributable to
Company 8,440 22,436
Preferred stock dividends (4,241) (4,241)
------ ------
Net income available to
common stockholders $4,199 $18,195
====== =======
Net income per share
available to common
stockholders: $0.04 $0.20
Basic and diluted earnings
per share ===== =====
Weighted-average common
shares outstanding: 109,707,274 88,503,295
Basic =========== ==========
Diluted 113,956,077 92,615,935
=========== ==========
For the Six
Months
June 30,
--------
2010 2009
---- ----
Revenues:
Rental $142,980 $134,135
Tenant recoveries 41,099 38,270
Other income 1,589 7,626
----- -----
Total revenues 185,668 180,031
------- -------
Expenses:
Rental operations 34,928 36,813
Real estate taxes 17,424 14,846
Depreciation and
amortization 55,385 51,813
General and administrative 12,718 10,407
Acquisition related
expenses 1,968 -
----- ---
Total expenses 122,423 113,879
------- -------
Income from operations 63,245 66,152
Equity in net loss of
unconsolidated
partnerships (377) (766)
Interest income 71 164
Interest expense (43,131) (24,955)
(Loss)/gain on derivative
instruments (347) 303
(Loss)/gain on
extinguishment of debt (2,265) 6,152
------ -----
Net income 17,196 47,050
Net income attributable to
noncontrolling interests (216) (1,350)
---- ------
Net income attributable to
Company 16,980 45,700
Preferred stock dividends (8,481) (8,481)
------ ------
Net income available to
common stockholders $8,499 $37,219
====== =======
Net income per share
available to common
stockholders: $0.08 $0.44
Basic and diluted earnings
per share ===== =====
Weighted-average common
shares outstanding: 104,000,339 84,403,582
Basic =========== ==========
Diluted 108,298,135 88,580,072
=========== ==========
BIOMED REALTY TRUST, INC.
CONSOLIDATED FUNDS FROM OPERATIONS
(In thousands, except share data)
(Unaudited)
Our FFO available to common shares and partnership and LTIP units and a
reconciliation to net income for the three and six months ended June 30,
2010 and 2009 (in thousands, except share data) was as follows:
Three Months
Ended
June 30,
--------
2010 2009
---- ----
Net income available to
common stockholders $4,199 $18,195
Adjustments:
Noncontrolling interests
in operating partnership 109 658
Depreciation and
amortization -
unconsolidated
partnerships 694 662
Depreciation and
amortization -
consolidated entities 26,469 24,501
Depreciation and
amortization - allocable
to noncontrolling
interest of consolidated
joint ventures (22) (19)
--- ---
Funds from operations
available to common
shares and Units $31,449 $43,997
======= =======
Funds from operations per
share - diluted $0.28 $0.48
===== =====
Weighted-average common
shares and Units
outstanding - diluted 113,956,077 92,615,935
=========== ==========
Six Months
Ended
June 30,
--------
2010 2009
---- ----
Net income available to
common stockholders $8,499 $37,219
Adjustments:
Noncontrolling interests
in operating partnership 237 1,380
Depreciation and
amortization -
unconsolidated
partnerships 1,357 1,323
Depreciation and
amortization -
consolidated entities 55,385 51,813
Depreciation and
amortization - allocable
to noncontrolling
interest of consolidated
joint ventures (43) (39)
--- ---
Funds from operations
available to common
shares and Units $65,435 $91,696
======= =======
Funds from operations per
share - diluted $0.60 $1.04
===== =====
Weighted-average common
shares and Units
outstanding - diluted 108,298,135 88,580,072
=========== ==========
We present funds from operations, or FFO, available to common shares and partnership and LTIP units because we consider it an important supplemental measure of our operating performance and believe it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions and extraordinary items, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from net income. We compute FFO in accordance with standards established by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT, in its March 1995 White Paper (as amended in November 1999 and April 2002). As defined by NAREIT, FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property, plus real estate related depreciation and amortization (excluding amortization of loan origination costs) and after adjustments for unconsolidated partnerships and joint ventures. Our computation may differ from the methodology for calculating FFO utilized by other equity REITs and, accordingly, may not be comparable to such other REITs. Further, FFO does not represent amounts available for management's discretionary use because of needed capital replacement or expansion, debt service obligations, or other commitments and uncertainties. FFO should not be considered as an alternative to net income (loss) (computed in accordance with GAAP) as an indicator of our financial performance or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends or make distributions.
SOURCE BioMed Realty Trust, Inc.
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