·
|
On
April 24, 2007, we closed one of the largest real estate transactions
in
Southern California history: the purchase of the EOP Portfolio
of Orange County and Downtown Los Angeles featuring 24 properties
and 11
development sites for $2.875 billion (together with reserves
for two year’s of interest, tenant improvements and
commissions) The acquisition financing included a $400.0
million term loan with a present balance of $110.0 million. The
Company has nothing outstanding on its revolving
line.
|
·
|
On
May 3, 2007, we completed the sale of Wateridge Plaza in San Diego
to GE
Capital for approximately $98.0 million. Proceeds to the
Company were $35.0 million.
|
·
|
On
May 25, 2007, we completed the sale of five of the EOP Portfolio
properties we purchased in Orange County, to Bixby Land Company
for
approximately $345.0 million. Proceeds to the Company were
$123.0 million.
|
·
|
On
June 29, 2007, we completed the sale of three of the EOP Portfolio
properties we purchased in Orange County, to a partnership between
Rockwood Capital LLC and The Muller Company for approximately $310.0
million. Proceeds to the Company were $37.0
million.
|
·
|
In
June, 2007, in anticipation of refinancing of the KPMG Tower we
entered
into a $425.0 million rate lock at an effective interest rate of
6.81%.
|
·
|
On
July 2, 2007, we completed the sale of Pacific Center in San Diego
to GE
Capital for approximately $200.0 million. Proceeds to the
Company were $84.0 million.
|
·
|
On
July 11, 2007, we entered into an agreement with EuroHypo for a
$450.0
million variable rate mortgage for KPMG Tower in Downtown Los Angeles
which was rate locked as indicated above. Net proceeds of
the refinancing after repayment of the existing of $210.0 million
mortgage
loan and payment of the defeasance costs, closing costs and loan
reserves
will be approximately $190.0 million. $110.0 million of
the proceeds will be used to fully retire the Company’s term
loan.
|
·
|
During
the second quarter, we completed new leases and renewals totaling
approximately 632,000 square feet (including joint venture properties)
including an early lease renewal of Wells Fargo at Wells Fargo
Denver (a
joint venture property) for approximately 411,275 square
feet.
|
·
|
Subsequent
to the quarter’s end, on July 14, 2007, we executed a new lease with
Latham & Watkins for approximately 300,000 square feet at KPMG Tower
for a 17 year term.
|
|
·
|
Based
on sales to date and transactions in escrow, the Company has achieved
approximately 60% of its previously stated $2.0 billion asset disposition
goal. Proceeds from sales to the Company during the quarter
were $195.0 million.
|
CONTACT:
|
Maguire
Properties, Inc.
|
Peggy
Moretti
|
|
Senior
Vice President, Investor and Public Relations
|
|
(213)
613-4558
|
June
30, 2007
|
December
31, 2006
|
|||||||
ASSETS
|
||||||||
Investments
in real estate
|
$ |
5,507,161
|
$ |
3,374,671
|
||||
Less:
accumulated depreciation and amortization
|
(408,610 | ) | (357,422 | ) | ||||
5,098,551
|
3,017,249
|
|||||||
Assets
associated with real estate held for sale
|
148,754
|
–
|
||||||
Net
real estate
|
5,247,305
|
3,017,249
|
||||||
Cash
and cash equivalents
|
207,871
|
101,123
|
||||||
Restricted
cash
|
251,398
|
99,150
|
||||||
Rents
and other receivables
|
30,624
|
19,766
|
||||||
Deferred
rents
|
43,058
|
39,262
|
||||||
Due
from affiliates
|
3,751
|
8,217
|
||||||
Deferred
leasing costs and value of in-place leases, net
|
246,442
|
146,522
|
||||||
Deferred
loan costs, net
|
43,239
|
23,808
|
||||||
Acquired
above market leases, net
|
32,581
|
21,848
|
||||||
Other
assets
|
8,845
|
10,406
|
||||||
Investment
in unconsolidated joint venture
|
21,399
|
24,378
|
||||||
Total
assets
|
$ |
6,136,513
|
$ |
3,511,729
|
||||
LIABILITIES,
MINORITY INTERESTS AND STOCKHOLDERS' EQUITY
|
||||||||
Mortgage
loans
|
$ |
5,232,969
|
$ |
2,779,349
|
||||
Other
secured loans
|
–
|
15,000
|
||||||
Accounts
payable and other liabilities
|
175,351
|
153,046
|
||||||
Dividends
and distributions payable
|
24,934
|
24,934
|
||||||
Capital
leases payable
|
5,507
|
5,996
|
||||||
Acquired
below market leases, net
|
188,225
|
72,821
|
||||||
Obligations
associated with real estate held for sale
|
119,774
|
–
|
||||||
Total
liabilities
|
$ |
5,746,760
|
$ |
3,051,146
|
||||
Minority
interests
|
18,981
|
28,671
|
||||||
Stockholders'
equity:
|
||||||||
Preferred
stock, $0.01 par value, 50,000,000 shares authorized:
|
||||||||
7.625%
Series A Cumulative Redeemable Preferred Stock, $25.00
|
||||||||
liquidation
preference, 10,000,000 shares issued and outstanding
|
100
|
100
|
||||||
Common
Stock, $0.01 par value, 100,000,000 shares authorized,
|
||||||||
47,211,200
and 46,985,241 shares issued and outstanding at
|
||||||||
June
30, 2007 and December 31, 2006, respectively
|
472
|
470
|
||||||
Additional
paid-in capital
|
687,882
|
680,980
|
||||||
Accumulated
deficit and dividends
|
(331,730 | ) | (257,124 | ) | ||||
Accumulated
other comprehensive income, net
|
14,048
|
7,486
|
||||||
Total
stockholders' equity
|
370,772
|
431,912
|
||||||
Total
liabilities, minority interests and stockholders' equity
|
$ |
6,136,513
|
$ |
3,511,729
|
||||
Three
Months Ended
|
||||||||
June
30, 2007
|
June
30, 2006
|
|||||||
|
||||||||
Revenues:
|
||||||||
Rental
|
$ |
90,901
|
$ |
63,046
|
||||
Tenant reimbursements
|
28,101
|
20,271
|
||||||
Hotel operations
|
7,061
|
6,888
|
||||||
Parking
|
11,958
|
10,176
|
||||||
Management, leasing and development
|
||||||||
services to affiliates
|
3,403
|
1,462
|
||||||
Interest and other
|
3,382
|
2,501
|
||||||
Total revenues
|
144,806
|
104,344
|
||||||
|
||||||||
Expenses:
|
||||||||
Rental property operating and maintenance
|
30,611
|
20,263
|
||||||
Hotel operating and maintenance
|
4,391
|
4,262
|
||||||
Real estate taxes
|
12,952
|
8,234
|
||||||
Parking
|
3,702
|
3,071
|
||||||
General and administrative
|
11,151
|
8,568
|
||||||
Other
Expense
|
1,043
|
17
|
||||||
Depreciation and amortization
|
56,042
|
31,657
|
||||||
Interest
|
63,453
|
31,699
|
||||||
Loss from early extinguishment of debt
|
8,336
|
4,107
|
||||||
Total expenses
|
191,681
|
111,878
|
||||||
Loss
before equity in net
loss of unconsolidated
|
||||||||
joint
venture, gain on sale of real
estate and minority interests
|
(46,875 | ) | (7,534 | ) | ||||
Equity in net loss of unconsolidated
joint venture
|
(531 | ) | (1,985 | ) | ||||
Minority interests
|
7,086
|
1,969
|
||||||
Loss from continuing operations
|
(40,320 | ) | (7,550 | ) | ||||
Discontinued
Operations:
|
||||||||
Loss
from discontinued operations before minority interests
|
(9,988 | ) | (2,559 | ) | ||||
Gain
on sales of real estate
|
33,890
|
–
|
||||||
Minority interests attributable to discontinued operations
|
(3,246 | ) |
353
|
|||||
Income
(loss) from discontinued operations
|
20,656
|
(2,206 | ) | |||||
|
||||||||
Net
loss
|
(19,664 | ) | (9,756 | ) | ||||
|
||||||||
Preferred stock dividends
|
(4,766 | ) | (4,766 | ) | ||||
|
||||||||
Net
loss available to common shareholders
|
$ | (24,430 | ) | $ | (14,522 | ) | ||
|
||||||||
Basic loss per share
|
||||||||
available to common shareholders
|
$ | (0.52 | ) | $ | (0.31 | ) | ||
|
||||||||
Diluted loss
per share available to
|
||||||||
common shareholders
|
$ | (0.52 | ) | $ | (0.31 | ) | ||
|
||||||||
Weighted-average common shares outstanding:
|
||||||||
Basic
and Diluted
|
46,678,583
|
46,156,438
|
Six
Months Ended
|
||||||||
June
30, 2007
|
June
30, 2006
|
|||||||
|
||||||||
Revenues:
|
||||||||
Rental
|
$ |
151,150
|
$ |
127,599
|
||||
Tenant reimbursements
|
49,160
|
41,931
|
||||||
Hotel operations
|
13,249
|
13,564
|
||||||
Parking
|
22,395
|
20,499
|
||||||
Management, leasing and development
|
||||||||
services to affiliates
|
4,870
|
3,117
|
||||||
Interest and other
|
4,986
|
3,230
|
||||||
Total revenues
|
245,810
|
209,940
|
||||||
|
||||||||
Expenses:
|
||||||||
Rental property operating and maintenance
|
54,566
|
41,302
|
||||||
Hotel operating and maintenance
|
8,390
|
8,447
|
||||||
Real estate taxes
|
20,941
|
17,155
|
||||||
Parking
|
6,743
|
5,950
|
||||||
General and administrative
|
18,915
|
14,693
|
||||||
Other
Expense
|
1,178
|
294
|
||||||
Depreciation and amortization
|
86,192
|
64,986
|
||||||
Interest
|
94,786
|
63,661
|
||||||
Loss from early extinguishment of debt
|
8,336
|
4,749
|
||||||
Total expenses
|
300,047
|
221,237
|
||||||
Loss
before equity in net
loss of unconsolidated
|
||||||||
joint
venture, gain on sale of real
estate and minority interests
|
(54,237 | ) | (11,297 | ) | ||||
Equity in net loss of unconsolidated
joint venture
|
(1,238 | ) | (2,810 | ) | ||||
Gain
on sale of real estate
|
–
|
108,469
|
||||||
Minority interests
|
8,833
|
(12,476 | ) | |||||
Income
(loss) from continuing operations
|
(46,642 | ) |
81,886
|
|||||
Discontinued
Operations:
|
||||||||
Loss
from discontinued operations before minority interests
|
(11,723 | ) | (2,411 | ) | ||||
Gain
on sale of real estate
|
33,890
|
–
|
||||||
Minority interests attributable to discontinued operations
|
(3,010 | ) |
332
|
|||||
Income
(loss) from discontinued operations
|
19,157
|
(2,079 | ) | |||||
|
||||||||
Net
(loss) income
|
(27,485 | ) |
79,807
|
|||||
Preferred stock dividends
|
(9,532 | ) | (9,532 | ) | ||||
Net
(loss) income available to
common shareholders
|
$ | (37,017 | ) | $ |
70,275
|
|||
Basic (loss)
income per share
|
||||||||
available to common shareholders
|
$ | (0.79 | ) | $ |
1.53
|
|||
|
||||||||
Diluted income (loss)
per share available to
|
||||||||
common shareholders
|
$ | (0.79 | ) | $ |
1.53
|
|||
|
||||||||
Weighted-average common shares outstanding:
|
||||||||
Basic
|
46,628,601
|
45,941,032
|
||||||
|
||||||||
Diluted
|
46,628,601
|
46,073,631
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30, 2007
|
June
30, 2006
|
June
30, 2007
|
June
30, 2006
|
|||||||||||||
Reconciliation
of net (loss) income to funds
|
||||||||||||||||
from
operations:
|
||||||||||||||||
Net
(loss) income available to common shareholders
|
$ | (24,430 | ) | $ | (14,522 | ) | $ | (37,017 | ) | $ |
70,275
|
|||||
Adjustments:
|
||||||||||||||||
Minority
interests
|
(3,840 | ) | (2,322 | ) | (5,823 | ) |
12,144
|
|||||||||
Gain
on sale of real estate
|
(33,890 | ) |
–
|
(33,890 | ) | (108,469 | ) | |||||||||
Real
estate depreciation and amortization
|
56,926
|
35,095
|
89,492
|
69,616
|
||||||||||||
Real
estate depreciation and amortization from
|
||||||||||||||||
unconsolidated
joint venture
|
2,428
|
3,497
|
4,879
|
5,850
|
||||||||||||
Funds
from operations available to common
|
||||||||||||||||
shareholders
and unit holders (FFO)
|
$ | (2,806 | ) | $ |
21,748
|
$ |
17,641
|
$ |
49,416
|
|||||||
Company
share of FFO (b)
|
$ | (2,425 | ) | $ |
18,750
|
$ |
15,245
|
$ |
42,410
|
|||||||
FFO
per share - basic
|
$ | (0.05 | ) | $ |
0.41
|
$ |
0.33
|
$ |
0.92
|
|||||||
FFO
per share - diluted
|
$ | (0.05 | ) | $ |
0.41
|
$ |
0.33
|
$ |
0.92
|
|||||||
Weighted-average
common shares outstanding:
|
||||||||||||||||
Basic
|
46,678,583
|
46,156,438
|
46,628,601
|
45,941,032
|
||||||||||||
Diluted
|
46,891,402
|
46,290,201
|
46,858,813
|
46,073,631
|
||||||||||||
Reconciliation
of FFO to FFO before loss
|
||||||||||||||||
from
early extinguishment of debt:
|
||||||||||||||||
FFO
available to common shareholders
|
||||||||||||||||
and
unit holders (FFO)
|
$ | (2,806 | ) | $ |
21,748
|
$ |
17,641
|
$ |
49,416
|
|||||||
Add:
loss from early extinguishment of debt
|
17,227
|
4,107
|
17,227
|
4,749
|
||||||||||||
FFO
before loss from early extinguishment
|
||||||||||||||||
of
debt
|
$ |
14,421
|
$ |
25,855
|
$ |
34,868
|
$ |
54,165
|
||||||||
Company
share of FFO before loss from
|
||||||||||||||||
early
extinguishment of debt (b)
|
$ |
12,462
|
$ |
22,290
|
$ |
30,132
|
$ |
46,474
|
||||||||
FFO
per share before loss from early
|
||||||||||||||||
extinguishment
of debt - basic
|
$ |
0.27
|
$ |
0.48
|
$ |
0.65
|
$ |
1.01
|
||||||||
FFO
per share before loss from early
|
||||||||||||||||
extinguishment
of debt - diluted
|
$ |
0.27
|
$ |
0.48
|
$ |
0.64
|
$ |
1.01
|
(a)
|
We
calculate funds from operations, or FFO, as defined by the National
Association of Real Estate Investment Trusts, or NAREIT. FFO
represents net income (loss) (computed in accordance with accounting
principles generally accepted in the United States of America,
or GAAP),
excluding gains (or losses) from sales of property, extraordinary
items,
real estate related depreciation and amortization (excluding amortization
of deferred financing costs) and after adjustments for unconsolidated
partnerships and joint ventures.
|
|
|
|
Management
uses FFO as a supplemental performance measure because in excluding
real
estate related depreciation and amortization and gains and losses
from
property dispositions and extraordinary items, it provides a performance
measure that, when compared year over year, captures trends in
occupancy
rates, rental rates and operating costs. We also believe that,
as a widely
recognized measure of the performance of REITs, FFO will be used
by
investors as a basis to compare our operating performance with
that of
other REITs.
|
|
|
|
Management
also uses FFO before losses from the early extinguishment of debt
as a
supplemental performance measure because these losses create significant
earnings volatility which in turn results in less comparability
between
reporting periods and less predictability about future earnings
potential.
The losses represent costs to extinguish debt prior to the stated
maturity
and the write-off of unamortized loan costs on the date of extinguishment.
The decision to extinguish debt prior to its maturity generally
results
from (i) the assumption of debt in connection with property acquisitions
that is priced or structured at less than desirable terms (e.g.
floating
interest rate instead of fixed interest rate) , (ii) short-term
bridge
financing obtained in connection with the acquisition of a property
or
portfolio of properties until such time as the company completes
its
long-term financing strategy, (iii) the early repayment of debt
associated
with properties sold or (iv) the restructuring or replacement of
corporate
level financings to accommodate property acquisitions. Consequently,
management views these losses as costs to complete the respective
acquisition or disposition of properties.
|
|
|
|
However,
because FFO excludes depreciation and amortization and captures
neither
the changes in the value of our properties that result from use
or market
conditions nor the level of capital expenditures and leasing commissions
necessary to maintain the operating performance of our properties,
all of
which have real economic effect and could materially impact our
results
from operations, the utility of FFO as a measure of our performance
is
limited. Other equity REITs may not calculate FFO in accordance
with the
NAREIT definition and, accordingly, our FFO may not be comparable
to such
other REITs' FFO. Accordingly, FFO should be considered only as
a
supplement to net income as a measure of our performance. FFO should
not
be used as a measure of our liquidity, nor is it indicative of
funds
available to fund our cash needs, including our ability to pay
dividends
or make distributions. FFO also should not be used as a supplement
to or
substitute for cash flow from operating activities (computed in
accordance
with GAAP).
|
|
|
(b)
|
Based
on a weighted average interest in our operating partnership for
the three
and six months ended June 30, 2007 and June 30, 2006 of 86.4%,
86.4%,
86.2% and 85.8% respectively.
|