Press Release

Brixmor Property Group Reports Fourth Quarter And Full Year 2018 Results

- Successful Execution in 2018 Sets Up Accelerating Growth -

- Delivers Record Annual New Lease Volume -

Company Release - 2/11/2019 4:05 PM ET

NEW YORK, Feb. 11, 2019 /PRNewswire/ -- Brixmor Property Group Inc. (NYSE: BRX) ("Brixmor" or the "Company") announced today its operating results for the three and twelve months ended December 31, 2018.  For the three months ended December 31, 2018 and 2017, net income attributable to common stockholders was $0.26 per diluted share and $0.23 per diluted share, respectively.

Key highlights for the three months ended December 31, 2018 include:

  • Executed 2.1 million square feet of new and renewal leases at comparable rent spreads of 11.2%, including 0.9 million square feet of new leases at comparable rent spreads of 31.5%
  • Executed 3.1 million square feet of total leasing volume, including options, at comparable rent spreads of 9.5%
  • Realized total leased occupancy of 91.9%, reflecting the impact of 70 basis points of space rejected in the Sears / Kmart bankruptcy, net of executed backfills
    • Realized anchor leased occupancy of 94.6%, reflecting the impact of 100 basis points of space rejected in the Sears / Kmart bankruptcy, net of executed backfills
    • Increased small shop leased occupancy to 85.7%, a 120 basis point increase from the comparable 2017 period
    • Increased leased to billed occupancy spread to 350 basis points, the widest since IPO
  • Reported NAREIT FFO of $0.40 per diluted share, including a $0.02 per share SEC settlement, discussed below, and, as previously announced, a $0.06 per share loss on extinguishment of debt
  • Generated same property NOI growth of (0.2%), driven by a 190 basis point contribution from base rent, offset by a 220 basis point detraction from net recoveries and provision for doubtful accounts 
    • The Sears / Kmart bankruptcy had an impact of approximately (90) basis points on same property NOI growth in the three months ended December 31, 2018  
    • The three months ended December 31, 2017 benefited from significant tax appeal and refund activity and unusually low provision for doubtful accounts
  • Grew the total in process reinvestment pipeline to $352.2 million, while delivering $40.0 million of projects at an average incremental NOI yield of 8%
  • Completed $290.2 million of dispositions comprised of 3.0 million square feet
  • Acquired three adjacencies and terminated a ground lease and acquired the associated building at an existing center for $8.2 million, repurchased $22.7 million of common stock, excluding commissions, and repaid $375.8 million of secured indebtedness, excluding amortization
  • Amended and restated $1.25 billion unsecured revolving credit facility and $1.15 billion of unsecured term loan facilities; as a result, the Company now has no debt maturities until 2021

Key highlights for the twelve months ended December 31, 2018 include:

  • Executed 8.5 million square feet of new and renewal leases at comparable rent spreads of 13.8%, including a record high of 3.9 million square feet of new leases at comparable rent spreads of 34.4%
    • Includes a record high 84 new anchor leases aggregating 2.5 million square feet at comparable rent spreads of 46.0%
  • Executed 12.4 million square feet of total leasing volume, including options, at comparable rent spreads of 11.8%
  • Reported NAREIT FFO of $1.85 per diluted share, including a $0.02 per share SEC settlement, discussed below, a $0.12 per share loss on extinguishment of debt, as previously announced, and $0.01 per share of litigation and other non-routine legal expenses
  • Generated same property NOI growth of 1.1%, driven by a 210 basis point contribution from base rent, offset by a 110 basis point  detraction from net recoveries and provision for doubtful accounts
    • The Sears / Kmart bankruptcy had an impact of approximately (20) basis points on same property NOI growth in the twelve months ended December 31, 2018  
  • Delivered $131.0 million of projects at an average incremental NOI yield of 9%
  • Completed $989.5 million of dispositions comprised of 9.3 million square feet
  • Acquired five adjacencies and terminated two ground leases and acquired the associated buildings at existing centers for $17.0 million, repurchased $104.6 million of common stock, excluding commissions, and repaid $881.4 million of secured indebtedness, excluding amortization

"I'm pleased to report that our team's accomplishments in 2018, which exceeded the plan we set forth at our Investor Day in 2017, have set the table for accelerating growth in 2019 and beyond," commented James Taylor, Chief Executive Officer and President.  "We achieved record levels of leasing during the year at sector leading releasing spreads, capitalized on favorable private market valuations to sell nearly $1 billion of non-core assets, delivered $131 million in value enhancing reinvestments, expanded our accretive reinvestment pipeline to $352 million to capitalize on the embedded value in our well located centers, and substantially improved the financial and operating flexibility of our capital structure."

FINANCIAL HIGHLIGHTS

Net Income

  • For the three months ended December 31, 2018 and 2017, net income attributable to common stockholders was $77.6 million, or $0.26 per diluted share, and $69.9 million, or $0.23 per diluted share, respectively.
  • For the twelve months ended December 31, 2018 and 2017, net income attributable to common stockholders was $366.3 million, or $1.21 per diluted share, and $300.3 million, or $0.98 per diluted share, respectively.

NAREIT FFO

  • For the three months ended December 31, 2018 and 2017, NAREIT FFO was $120.8 million, or $0.40 per diluted share, and $157.7 million, or $0.52 per diluted share, respectively. Results for the three months ended December 31, 2018 include a loss on extinguishment of debt related to the prepayment of secured indebtedness and the amendment and restatement of Brixmor Operating Partnership LP's (the "Operating Partnership") credit facilities, an SEC settlement and other items that impact FFO comparability of ($24.9) million, or ($0.08) per diluted share.  Results for the three months ended December 31, 2017 include litigation and other non-routine legal expenses and other items that impact FFO comparability of ($2.3) million, or ($0.01) per diluted share.
  • For the twelve months ended December 31, 2018 and 2017, NAREIT FFO was $558.3 million, or $1.85 per diluted share, and $638.4 million, or $2.09 per diluted share, respectively.  Results for the twelve months ended December 31, 2018 include a loss on extinguishment of debt related to the prepayment of secured indebtedness and the amendment and restatement of the Operating Partnership's credit facilities, an SEC settlement, litigation and other non-routine legal expenses and other items that impact FFO comparability of ($47.1) million, or ($0.16) per diluted share.  Results for the twelve months ended December 31, 2017 include litigation and other non-routine legal expenses and other items that impact FFO comparability of ($5.7) million, or ($0.02) per diluted share.

Same Property NOI Growth

  • Same property NOI growth for the three months ended December 31, 2018 was (0.2%) versus the comparable 2017 period. 
    • Same property base rent for the three months ended December 31, 2018 contributed 190 basis points to same property NOI growth.
    • Net recoveries and provision for doubtful accounts for the three months ended December 31, 2018 negatively impacted same property NOI growth by 220 basis points, as the three months ended December 31, 2017 benefited from significant tax appeal and refund activity and unusually low provision for doubtful accounts.
    • The Sears / Kmart bankruptcy had an impact of approximately (90) basis points on same property NOI growth in the three months ended December 31, 2018. 
  • Same property NOI growth for the twelve months ended December 31, 2018 was 1.1% versus the comparable 2017 period. 
    • Same property base rent for the twelve months ended December 31, 2018 contributed 210 basis points to same property NOI growth.   
    • Net recoveries and provision for doubtful accounts for the twelve months ended December 31, 2018 negatively impacted same property NOI growth by 110 basis points.
    • The Sears / Kmart bankruptcy had an impact of approximately (20) basis points on same property NOI growth in the twelve months ended December 31, 2018.  

Dividend

  • The Company's Board of Directors declared a quarterly cash dividend of $0.28 per common share (equivalent to $1.12 per annum) for the first quarter of 2019.
  • The dividend is payable on April 15, 2019 to stockholders of record on April 5, 2019, representing an ex-dividend date of April 4, 2019.

Other Matters

  • The Company and the staff of the Enforcement Division of the Securities Exchange Commission ("SEC") have reached agreement on the material terms of a negotiated resolution relating to the SEC's investigation of the matters disclosed in the Company's February 8, 2016 Form 8-K relating to the Company's prior management.  The agreement with the SEC staff, which is subject to documentation and approval by the SEC, includes a civil penalty of $7.0 million.  The Company has accrued an expense of $7.0 million for this contingent liability for the quarter ended December 31, 2018.
  • In addition, the Company believes that no additional proceedings relating to these matters will be brought against the Company.

PORTFOLIO AND INVESTMENT ACTIVITY

Value Enhancing Reinvestment Opportunities

  • During the three months ended December 31, 2018, the Company completed eight value enhancing reinvestment projects and added 11 new reinvestment opportunities to its in process pipeline.  Projects added include five anchor space repositioning projects, two outparcel development projects and four redevelopment projects, with a total aggregate net estimated cost of approximately $54.5 million at an expected average incremental NOI yield of 8%.
  • At December 31, 2018, the value enhancing reinvestment in process pipeline was comprised of 60 projects with an aggregate net estimated cost of approximately $352.2 million.  The in process pipeline includes 33 anchor space repositioning projects with an aggregate net estimated cost of approximately $136.4 million at expected incremental NOI yields of 9 to 14%; 12 outparcel development projects with an aggregate net estimated cost of approximately $24.5 million at an expected average incremental NOI yield of 11%; and 15 redevelopment projects with an aggregate net estimated cost of approximately $191.3 million at an expected average incremental NOI yield of 9%.

Dispositions

  • During the three months ended December 31, 2018, the Company generated approximately $290.2 million of gross proceeds on the disposition of 20 assets and one land parcel comprised of 3.0 million square feet.   
  • During the twelve months ended December 31, 2018, the Company generated approximately $989.5 million of gross proceeds on the disposition of 62 assets, as well as two partial properties and one land parcel, comprised of 9.3 million square feet.

Acquisitions and Share Repurchases

  • During the three months ended December 31, 2018, the Company acquired three adjacencies at existing centers and terminated a ground lease and acquired the associated building at an existing center for a combined purchase price of $8.2 million.
  • During the twelve months ended December 31, 2018, the Company acquired five adjacencies at existing centers and terminated ground leases and acquired the associated buildings at two existing centers for a combined purchase price of $17.0 million.
  • During the three months ended December 31, 2018, the Company repurchased 1.4 million shares of common stock under its share repurchase program at an average price per share of $16.07 for a total of approximately $22.7 million, excluding commissions.  Since inception of the share repurchase program in December 2017, the Company has repurchased 6.6 million shares of common stock at an average price per share of $16.63 for a total of approximately $110.5 million, excluding commissions. As of December 31, 2018, the share repurchase program had $289.5 million of available repurchase capacity.

CAPITAL STRUCTURE

  • As previously announced, during the three months ended December 31, 2018, the Operating Partnership executed amendments and restatements to its credit facilities with an aggregate maximum principal amount of $2.4 billion (the "Facilities"), extending the weighted average maturity and lowering the aggregate pricing of the Facilities.  The Facilities are comprised of the Operating Partnership's $1.25 billion unsecured revolving credit facility and $1.15 billion of unsecured term loan facilities, comprised of three separate term loans.
  • Also as previously announced, on November 30, 2018, the Company repaid $181.6 million of secured indebtedness, excluding amortization, scheduled to mature in 2020 at a weighted average stated interest rate of 5.91% and on December 13, 2018, the Company repaid $194.2 million of secured indebtedness, excluding amortization, scheduled to mature in 2021 at a weighted average stated interest rate of 6.24%. 
    • In aggregate during 2018, the Company repaid $881.4 million of secured indebtedness, excluding amortization, increasing its percent of unencumbered NOI to 99.9% from 76.1% at December 31, 2016.
  • As a result of capital transactions during 2018, the Company extended its weighted average maturity to 5.2 years at December 31, 2018 and has no debt maturities until 2021.

GUIDANCE

  • The Company expects 2019 NAREIT FFO per diluted share of $1.86 – 1.94 and same property NOI growth of 2.75 – 3.25%. 
  • The following table provides a bridge from the Company's 2018 NAREIT FFO per diluted share to the Company's 2019 estimated NAREIT FFO per diluted share:

 



Low



High

2018 NAREIT FFO per diluted share 


$1.85



$1.85

Gain (loss) on extinguishment of debt, net


0.12



0.12

SEC settlement


0.02



0.02

Litigation and other non-routine legal expenses


0.01



0.01

2018 NAREIT FFO per diluted share, adjusted


$2.00



$2.00







Same property NOI growth


0.07



0.08

Non-cash GAAP rental adjustments 1


(0.04)



(0.03)

Impact of lease accounting change, ASC 842 (recognized through General & Administrative)


(0.03)



(0.03)

NOI dilution associated with 2018 asset sales


(0.18)



(0.18)

Impact of leverage reduction, share repurchase activity and other


0.07



0.10

2019E NAREIT FFO per diluted share, before prospective capital recycling  2

 


$1.89



$1.94







Prospective capital recycling


(0.03)



-

2019E NAREIT FFO per diluted share 2


$1.86



$1.94







1   Includes straight-line rental income, amortization of above- and below-market rent and tenant inducements and straight-line ground rent expense.

2   Does not include any expectations of one-time items, including, but not limited to, litigation and other non-routine legal expenses.

 

The following table provides a reconciliation of the range of the Company's 2019 estimated net income attributable to common stockholders to NAREIT FFO:

 (Unaudited, dollars in millions, except per share amounts)


2019E


2019E Per Diluted

Share

Net income attributable to common stockholders


$238 - $261


$0.80 - $0.88

Depreciation and amortization


315


1.06

NAREIT FFO


$553 - $576


$1.86 - $1.94

 

CONNECT WITH BRIXMOR

 

CONFERENCE CALL AND SUPPLEMENTAL INFORMATION

The Company will host a teleconference on Tuesday, February 12, 2019 at 10:00 AM ET.  To participate, please dial 877.705.6003 (domestic) or 201.493.6725 (international) within 15 minutes of the scheduled start of the call.  The teleconference can also be accessed via a live webcast at www.brixmor.com in the Investors section. A replay of the teleconference will be available through midnight ET on February 26, 2019 by dialing 844.512.2921 (domestic) or 412.317.6671 (international) (Passcode: 13685137) or via the web through February 12, 2020 at www.brixmor.com  in the Investors section.

The Company's Supplemental Disclosure will be posted at www.brixmor.com in the Investors section.  These materials are also available to all interested parties upon request to the Company at investorrelations@brixmor.com or 800.468.7526.

NON-GAAP DISCLOSURES

The Company presents the non-GAAP performance measures set forth below.  These measures should not be considered as alternatives to, or more meaningful than, net income (presented in accordance with GAAP) or other GAAP financial measures, as an indicator of financial performance and are not alternatives to, or more meaningful than, cash flow from operating activities (presented in accordance with GAAP) as a measure of liquidity. Non-GAAP performance measures have limitations as they do not include all items of income and expense that affect operations, and accordingly, should always be considered as supplemental financial results to those presented in accordance with GAAP.  The Company's computation of these non-GAAP performance measures may differ in certain respects from the methodology utilized by other REITs and, therefore, may not be comparable to similarly titled measures presented by such other REITs. Investors are cautioned that items excluded from these non-GAAP performance measures are relevant to understanding and addressing financial performance.  A reconciliation of these non-GAAP performance measures to net income is presented in the attached table.

NAREIT FFO

NAREIT FFO is a supplemental non-GAAP performance measure utilized to evaluate the operating and financial performance of real estate companies. The National Association of Real Estate Investment Trusts ("NAREIT") defines FFO as net income (loss) presented in accordance with GAAP excluding (i) gain (loss) on disposition of operating properties, plus (ii) depreciation and amortization of operating properties, (iii) impairment of operating properties and real estate equity investments and (iv) after adjustments for unconsolidated joint ventures calculated to reflect FFO on the same basis.  The Company believes NAREIT FFO assists investors in analyzing and comparing the operating and financial performance of a company's real estate between periods. 

Same Property NOI

Same property NOI is a supplemental, non-GAAP performance measure utilized to evaluate the operating performance of real estate companies.  Same property NOI is calculated (using properties owned for the entirety of both periods excluding properties under development and completed development properties which have been stabilized for less than one year), as total property revenues ((i) base rent, ancillary and other, (ii) expense reimbursements, and (iii) percentage rents) less direct property operating expenses ((i) operating costs, (ii) real estate taxes, and (iii) provision for doubtful accounts).  Same property NOI excludes (i) corporate level expenses (including G&A), (ii) lease termination fees, (iii) straight-line rental income, (iv) amortization of above- and below-market leases and tenant inducements, (v) straight-line ground rent expense, and (vi) income or expense associated with the Company's captive insurance entity.  The Company believes same property NOI assists investors in analyzing Brixmor's comparative operating and financial performance because it eliminates disparities in NOI due to the acquisition, disposition or stabilization of development properties during the period presented and therefore provides a more consistent metric for comparing the operating performance of a company's real estate between periods.

ABOUT BRIXMOR PROPERTY GROUP

Brixmor (NYSE: BRX) is a real estate investment trust (REIT) that owns and operates a high-quality, national portfolio of open-air shopping centers. Its 425 retail centers comprise approximately 74 million square feet of prime retail space in established trade areas.  The Company strives to own and operate shopping centers that reflect Brixmor's vision "to be the center of the communities we serve" and are home to a diverse mix of thriving national, regional and local retailers.  Brixmor is a proud real estate partner to more than 5,000 retailers including The TJX Companies, The Kroger Co., Publix Super Markets, Wal-Mart, Ross Stores and L.A. Fitness.

Brixmor announces material information to its investors in SEC filings and press releases and on public conference calls, webcasts and the "Investor" page of its website at www.brixmor.com. The Company also uses social media to communicate with its investors and the public, and the information Brixmor posts on social media may be deemed material information. Therefore, Brixmor encourages investors and others interested in the Company to review the information that it posts on its website and on its social media channels.

SAFE HARBOR LANGUAGE

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  These statements include, but are not limited to, statements related to the Company's expectations regarding the performance of its business, its financial results, its liquidity and capital resources and other non-historical statements.  You can identify these forward-looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "seeks," "approximately," "projects," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including those described under the sections entitled "Forward-Looking Statements" and "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2018, as such factors may be updated from time to time in our periodic filings with the SEC, which are accessible on the SEC's website at www.sec.gov.  Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the Company's filings with the SEC. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

 

CONSOLIDATED BALANCE SHEETS

Unaudited, dollars in thousands, except share information














As of


As of






12/31/18


12/31/17


Assets






Real estate







Land

$               1,804,504


$               1,984,309




Buildings and tenant improvements

7,535,985


8,063,871




Construction in progress

90,378


81,214




Lease intangibles

667,910


792,097






10,098,777


10,921,491




Accumulated depreciation and amortization

(2,349,127)


(2,361,070)



Real estate, net

7,749,650


8,560,421



Cash and cash equivalents

41,745


56,938



Restricted cash

9,020


53,839



Marketable securities

30,243


28,006



Receivables, net of allowance for doubtful accounts of $21,724 and $17,205

228,297


232,111



Deferred charges and prepaid expenses, net

145,662


147,508



Real estate assets held for sale

2,901


27,081



Other assets 

34,903


48,022


Total assets

$               8,242,421


$               9,153,926










Liabilities






Debt obligations, net

$              4,885,863


$              5,676,238



Accounts payable, accrued expenses and other liabilities

520,459


569,340


Total liabilities

5,406,322


6,245,578










Equity






Common stock, $0.01 par value; authorized 3,000,000,000 shares;







305,130,472 and 304,947,144 shares issued and 298,488,516 and 304,620,186







shares outstanding

2,985


3,046



Additional paid-in capital

3,233,329


3,330,466



Accumulated other comprehensive income

15,973


24,211



Distributions in excess of net income

(416,188)


(449,375)


Total equity

2,836,099


2,908,348


Total liabilities and equity

$               8,242,421


$               9,153,926









 

 

CONSOLIDATED STATEMENTS OF OPERATIONS

Unaudited, dollars in thousands, except per share amounts


















Three Months Ended


Twelve Months Ended






12/31/18


12/31/17


12/31/18


12/31/17














Revenues










Rental income

$           229,541


$            247,113


$          956,090


$          997,089



Expense reimbursements

67,082


71,918


271,671


278,636



Other revenues

1,032


1,029


6,579


7,455


Total revenues

297,655


320,060


1,234,340


1,283,180














Operating expenses










Operating costs

34,877


35,137


136,217


136,092



Real estate taxes

42,018


43,490


177,401


179,097



Depreciation and amortization

85,345


89,988


352,245


375,028



Provision for doubtful accounts

3,624


1,300


10,082


5,323



Impairment of real estate assets

9,094


12,721


53,295


40,104



General and administrative

28,641


25,204


93,596


92,247


Total operating expenses

203,599


207,840


822,836


827,891














Other income (expense)










Dividends and interest

163


131


519


365



Interest expense

(49,290)


(56,076)


(215,025)


(226,660)



Gain on sale of real estate assets

50,125


13,927


209,168


68,847



Gain (loss) on extinguishment of debt, net

(16,914)


10


(37,096)


498



Other

(586)


(316)


(2,786)


(2,907)


Total other expense

(16,502)


(42,324)


(45,220)


(159,857)














Income before equity in income of unconsolidated joint venture

77,554


69,896


366,284


295,432


Equity in income of unconsolidated joint venture

-


-


-


381


Gain on disposition of unconsolidated joint venture interest

-


-


-


4,556


Net income 

77,554


69,896


366,284


300,369


Net income attributable to non-controlling interests

-


-


-


(76)


Net income attributable to Brixmor Property Group Inc.

77,554


69,896


366,284


300,293


Preferred stock dividends 

-


-


-


(39)


Net income attributable to common stockholders

$             77,554


$             69,896


$          366,284


$          300,254














Per common share:










Net income attributable to common stockholders:











Basic 

$                  0.26


$                  0.23


$                    1.21


$                  0.98




Diluted 

$                  0.26


$                  0.23


$                    1.21


$                  0.98



Weighted average shares:











Basic 

299,112


304,892


302,074


304,834




Diluted 

299,438


305,265


302,339


305,281













 

 

FUNDS FROM OPERATIONS (FFO)

Unaudited, dollars in thousands, except per share amounts


















Three Months Ended


Twelve Months Ended






12/31/18


12/31/17


12/31/18


12/31/17














Net income

$             77,554


$             69,896


$          366,284


$          300,369



Gain on disposition of operating properties

(50,125)


(13,927)


(209,168)


(68,847)



Gain on disposition of unconsolidated joint venture interest

-


-


-


(4,556)



Depreciation and amortization- real estate related- continuing operations

84,246


89,015


347,862


371,255



Depreciation and amortization- real estate related- unconsolidated joint venture

-


-


-


56



Impairment of operating properties

9,094


12,721


53,295


40,104


NAREIT FFO

$           120,769


$           157,705


$          558,273


$           638,381














NAREIT FFO per share/OP Unit - diluted

$                  0.40


$                  0.52


$                   1.85


$                  2.09


Weighted average shares/OP Units outstanding - basic and diluted

299,438


305,265


302,339


305,281














Items that impact FFO comparability










Gain (loss) on extinguishment of debt, net

$             (16,914)


$                      10


$           (37,096)


$                   498



SEC settlement

(7,000)


-


(7,000)


-



Litigation and other non-routine legal expenses

(851)


(2,184)


(2,506)


(5,813)



Transaction expenses

(173)


(167)


(467)


(371)


Total items that impact FFO comparability

$           (24,938)


$              (2,341)


$           (47,069)


$             (5,686)


Items that impact FFO comparability, net per share

$                (0.08)


$                 (0.01)


$                 (0.16)


$                (0.02)














Additional Disclosures










Straight-line rental income, net (1)

$               3,456


$               3,965


$              15,352


$              18,449



Amortization of above- and below-market leases and tenant inducements, net (2)

5,063


6,011


23,313


27,460



Straight-line ground rent expense (3)

(31)


(30)


(131)


(134)














Dividends declared per share/OP Unit

$               0.280


$               0.275


$                 1.105


$                1.055


Share/OP Unit dividends declared

$             83,577


$              83,771


$          332,547


$            321,610


Share/OP Unit dividend payout ratio (as % of NAREIT FFO) 

69.2%


53.1%


59.6%


50.4%





































(1) Includes unconsolidated joint venture Montecito Marketplace straight-line rental expense, net of $2 at pro rata share for the twelve months ended December 31, 2017. Montecito Marketplace was sold on August 8, 2017.

(2) Includes unconsolidated joint venture Montecito Marketplace amortization of above- and below-market leases and tenant inducements, net of $15 at pro rata share for the twelve months ended December 31, 2017. Montecito Marketplace was sold on August 8, 2017.

(3) Straight-line ground rent expense is included in Operating costs on the Consolidated Statements of Operations. 

 

 

SAME PROPERTY NOI ANALYSIS 





Unaudited, dollars in thousands




























Three Months Ended




Twelve Months Ended









12/31/18


12/31/17


Change


12/31/18


12/31/17


Change


Same Property NOI Analysis














Number of properties


420


420


-


417


417


-


Percent billed


88.4%


89.9%


(1.5%)


88.4%


89.9%


(1.5%)


Percent leased


91.9%


91.9%


-%


91.9%


91.9%


-%



















Revenues















Base rent


$         209,513


$         205,672




$         822,778


$         806,190





Ancillary and other


4,278


4,087




16,145


14,371





Expense reimbursements


65,065


64,636




248,541


245,158





Percentage rents


838


924




6,014


6,609









279,694


275,319


1.6%


1,093,478


1,072,328


2.0%


Operating expenses 















Operating costs


(35,336)


(34,035)




(125,878)


(121,064)





Real estate taxes


(40,776)


(39,416)




(162,455)


(158,844)





Provision for doubtful accounts 


(3,248)


(1,165)




(8,608)


(4,503)









(79,360)


(74,616)


6.4%


(296,941)


(284,411)


4.4%


Same property NOI 


$        200,334


$        200,703


(0.2%)


$         796,537


$          787,917


1.1%



















NOI margin





71.6%


72.9%




72.8%


73.5%




Expense recovery ratio





85.5%


88.0%




86.2%


87.6%





















Percent contribution to same property NOI growth:



















Change


Percent Contribution




Change


Percent Contribution





Base rent


$              3,841


1.9%




$            16,588


2.1%





Ancillary and other


191


0.1%




1,774


0.2%





Net recoveries


(2,232)


(1.2%)




(5,042)


(0.6%)





Percentage rents


(86)


(0.0%)




(595)


(0.1%)





Provision for doubtful accounts 


(2,083)


(1.0%)




(4,105)


(0.5%)











(0.2%)






1.1%





















Reconciliation of Net Income Attributable to Common Stockholders to Same Property NOI













Same property NOI


$        200,334


$        200,703




$         796,537


$          787,917




Adjustments:















Non-same property NOI


7,005


28,418




71,897


122,127





Lease termination fees


1,309


1,066




3,672


6,542





Straight-line rental income, net


3,456


3,965




15,352


18,451





Amortization of above- and below-market leases and tenant inducements, net


5,063


6,011




23,313


27,445





Fee income


-


-




-


320





Straight-line ground rent expense


(31)


(30)




(131)


(134)





Depreciation and amortization 


(85,345)


(89,988)




(352,245)


(375,028)





Impairment of real estate assets


(9,094)


(12,721)




(53,295)


(40,104)





General and administrative 


(28,641)


(25,204)




(93,596)


(92,247)





Total other expense


(16,502)


(42,324)




(45,220)


(159,857)





Equity in income of unconsolidated joint venture 


-


-




-


381





Gain on disposition of unconsolidated joint venture interest


-


-




-


4,556





Net income attributable to non-controlling interests 


-


-




-


(76)





Preferred stock dividends


-


-




-


(39)





















Net income attributable to common stockholders


$            77,554


$          69,896




$        366,284


$        300,254




















 

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SOURCE Brixmor Property Group Inc.