Q2 2016 Supplement - Nexpoint Residential Trust

Transcription

NYSE: NXRT
Supplemental Information
2nd Quarter 2016
The Unaudited Reconciliation Tables and Supplemental Disclosure of NexPoint Residential Trust, Inc. ("NXRT" or the "Company") presented herein speak only as of the date or period indicated, and
NXRT does not undertake any obligation, and disclaims any duty, to update any of this information except as required by law. NXRT’s future financial performance is subject to various risks and
uncertainties that could cause actual results to differ materially from expectations. The factors that could affect NXRT's future financial results are discussed more fully in our annual and quarterly reports
filed with the SEC. Readers are advised to refer to our filings with the SEC for additional information concerning NXRT. Pictures above are illustrative of a typical NXRT value-add rehab execution as
shown at Arbors on Forest Ridge in Bedford, Texas.
NexPoint Residential Trust, Inc.
300 Crescent Court
Suite 700
Dallas, Texas 75201
August 9, 2016
Phone: 972-628-4100
www.nexpointliving.com
Cautionary Statements
Non-GAAP Financial Measures
This presentation contains non-GAAP financial measures. A “non-GAAP financial measure” is defined as a numerical measure of a company’s financial performance that excludes or includes amounts
so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flow of the
Company. The non-GAAP financial measures used within this presentation are funds from operations, or FFO, FFO per common share, adjusted funds from operations, or AFFO, AFFO per common
share, and net operating income, or NOI. FFO is defined by the National Association of Real Estate Investment Trusts, or NAREIT, as net income (loss) computed in accordance with GAAP, excluding
gains or losses from real estate dispositions, plus real estate depreciation and amortization and impairment charges. We compute FFO in accordance with NAREIT’s definition. Our presentation differs
slightly in that we begin with net income (loss) before adjusting for noncontrolling interest as an adjustment to arrive at FFO. AFFO is calculated by adjusting our FFO by adding back items that do not
reflect ongoing property operations, such as acquisition expenses, equity-based compensation expenses and the amortization of deferred loan costs. AFFO will also be adjusted to include any gains
(losses) from sales of property to the extent excluded from FFO and exclude relevant noncontrolling interests. NOI is calculated by adjusting net income (loss) to add back interest, depreciation and
amortization, acquisition costs, non-operating fees to affiliates, gains or losses from the sale of operating real estate assets, corporate general and administrative costs and entity level general and
administrative costs that are either non-recurring in nature or incurred on behalf of us at the property for expenses such as legal, professional and franchise tax fees. We believe that the use of FFO,
AFFO, and NOI, combined with the required GAAP presentations, improves the understanding of operating results of REITs among investors and makes comparisons of operating results among such
companies more meaningful. While FFO, AFFO, and NOI are relevant and widely used measures of operating performance of REITs, they do not represent cash flows from operations or net income
(loss) as defined by GAAP and should not be considered an alternative to those measures in evaluating our liquidity or operating performance. FFO, AFFO, and NOI do not purport to be indicative of
cash available to fund our future cash requirements. Further, our computation of FFO, AFFO, and NOI may not be comparable to FFO, AFFO, and NOI reported by other REITs.
Forward Looking Statements
This presentation includes forward-looking statements. These statements reflect the current views of the Company’s management with respect to future events and financial performance. These
statements include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the Company’s business and industry in general, statements
regarding NXRT's guidance for financial results for 2016. Statements that include the words “expect,” “intend,” “estimate,” “may,” “should,” “anticipate” and similar statements of a future or forwardlooking nature identify forward-looking statements for purposes of the federal securities laws or otherwise. Forward-looking statements address matters that involve risks and uncertainties. Accordingly,
there are or will be important factors that could cause the Company’s actual results to differ materially from those indicated in these statements. For a discussion of the factors that could change these
forward-looking statements, see our annual and quarterly reports filed with the SEC. The statements made herein speak only as of the date of this presentation and the Company does not undertake to
update this information except as required by law. Past performance does not guarantee future results. Performance during time periods shown is limited and may not reflect the performance in
different economic and market cycles. There can be no assurance that similar performance will be experienced.
Additional Information
For additional information, see our filings with the SEC including our Annual Report on Form 10-K. Our filings with the SEC are available on our website, www.nexpointliving.com, under the "Investor
Relations" tab. Investors are urged to read our Annual Report on Form 10-K and our other filings with the SEC, including our Forms 10-Q and Forms 8-K, in their entirety.
1
Table of Contents
Company Profile
3
Consolidated Statement of Operations
5
Financial Summary
Reconciliation of Net Income (Loss) to FFO, AFFO and NOI
4
6
Balance Sheet
7
Components to Net Asset Value
9
Joint Ventures Details
8
Portfolio Operating Metrics
10
Historical Capital Expenditures
12
Outstanding Debt Details
14
Same Store Results
Debt Maturity Schedule
11
13
Acquisition Details
15
Definitions
17
Rehabilitation Details
Reconciliation of Guidance
16
ARBORS ON FOREST RIDGE - CLUBHOUSE AFTER RENOVATION
18
Contact:
Marilynn Meek
Financial Relations Board
Phone: 212.827.3773
ARBORS ON FOREST RIDGE - CLUBHOUSE BEFORE RENOVATION
Email: [email protected]
2
Company Profile
Company Overview
Operating Portfolio by Market (1)
NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock
Exchange under the symbol "NXRT," and is primarily focused on acquiring, owning and operating
well-located, middle-income, multifamily properties with "value-add" potential in large cities, primarily
in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real
Estate Advisors, L.P., an affiliate of Highland Capital Management, L.P., a leading global alternative
asset manager and an SEC-registered investment adviser.
Market Exposure (% of Units)
Dallas/Fort Worth
33%
Atlanta
21%
Nashville
8%
District of Columbia
7%
Orlando
7%
Phoenix
6%
Charlotte
5%
Tampa
5%
West Palm Beach (+217)
4%
Jacksonville (-679)
3%
Houston
2%
Austin (-200)
0%
Total:
100%
We pursue investments in multifamily real property, typically with a value-add component, where we
can invest capital to provide "lifestyle" amenties to "work force" and middle-income housing. Our
value-add strategies seek to provide both dramatically-improved communities for our residents and
outsized returns for our shareholders. As of August 8, 2016, NXRT owned 12,493 units across the
U.S. in Texas, Arizona, Georgia, Tennessee, Florida, North Carolina, and the Washington D.C.
Metro area.
Recent News
Company Profile
● As of June 30, 2016, NXRT owned 39 properties, consisting of 12,276 units with average monthly
rent per unit of $830 and a portfolio occupancy of 93.7%.
● In Q2 2016, NXRT upgraded 550 units, reported net income, FFO, and AFFO of $16.6M, $7.2M
and $22.5M, respectively, and achieved Same Store NOI growth of 11.0%.
● During Q2 2016, NXRT completed the disposition of three properties: Mandarin Reserve and Park
at Regency in Jacksonville, FL and Meridian in Austin, TX for $64.25M gross sale proceeds.
● On July 27, 2016, NXRT used the net proceeds from the sale of Meridian in a like-kind exchange,
to acquire CityView, a 217-unit property in West Palm Beach, FL, for $22.4M. This was the
Company's second acquisition in West Palm Beach in the last 18 months, bringing NXRT's total
portfolio to 40 properties consisting of 12,493 units in 11 markets as illustrated above right.
Exchange/Ticker
Share Price (1)
Insider Ownership
2016 Q2 Dividend Per Share
Dividend Yield (1)
Share Oustanding (basic and diluted)
Guidance Summary (2016 Full Year) (2)
Revenue & Average Rent Per Unit
$40,000
Revenue ($000s)
Avg. Rent/Unit
$30,000
$750
Revenue (3)
NOI (3)
FFO/Share (common)
AFFO/Share (common) (4)
G&A Expenses (5)
$650
$20,000
$600
$15,000
$550
$10,000
$500
$5,000
3
($ in thousands, except for per share data)
Low-End
$700
$25,000
$0
$850
$800
$35,000
$450
4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16
$400
NYSE:NXRT
$19.22
17.28%
$0.206
4.29%
21,294
130,600
68,000
1.38
1.46
9,600
Mid-Point
High-End
131,600
69,000
1.43
1.50
10,100
132,600
70,000
1.47
1.55
10,600
(1) As of the close of market trading August 8, 2016.
(2) 2016 Full Year Guidance assumes we own all properties as of June 30, 2016 for the full year 2016.
(3) Gross estimates (including NCI).
(4) AFFO guidance excludes the gain on sales for the three dispositions.
(5) Includes advisory and administrative expenses and other typical corporate G&A expenses.
Financial Summary
In thousands, except for per share and per unit data
Company Profile
Q2 2016
Market Capitalization
Weighted average common shares outstanding - basic and diluted
OP Units Outstanding
Share Price (as of the last day of the quarter, respectively)
Earnings Profile
Revenues
Operating Expenses
NOI
Same Store NOI
Same Store NOI Growth (%)
Per Share
FFO
AFFO
Dividends declared per common share
FFO Coverage (2)
AFFO Coverage (2)
Portfolio
Total Properties
Total Units
Occupancy
Average Effective Monthly Rent per Unit
Same Store Portfolio
Total Same Store Properties
Total Same Store Units
Occupancy
Average Effective Monthly Rent per Unit
Value-Add Program (3)
Completed Rehab Units
YTD Completed Rehab Units
Cumulative Completed Rehab Units
Average Effective Monthly Rent per Unit (Post-Rehab)
Average Increase to Effective Monthly Rent per Unit (Post-Rehab)
Debt Summary
Total Mortgage Debt Outstanding
Credit Facility
Bridge Facility
Leverage Ratio (Debt to Enterprise Value)
$388,000
21,294
$18.20
$33,657
16,276
17,381
15,133
11.0%
Q2 2015
FY 2015
FY 2014
FY 2013 (1)
$286,000
21,294
$13.43
$279,000
21,294
$13.09
$236,000
21,294
$14.00
$8,000
21,294
$14.00
$28,747
13,907
14,840
13,630
$117,658
57,276
60,382
1,096
34.2%
$43,150
21,056
22,094
817
$316
187
129
$0.17
$0.54
$0.000
N/A
N/A
($0.00)
$0.01
$0.000
N/A
N/A
$0.34
$1.06
$0.206
1.64x
5.13x
$0.32
$0.34
$0.206
1.53x
1.63x
$1.20
$1.38
$0.618
1.95x
2.24x
39
12,276
93.7%
$830
39
12,038
93.3%
$789
42
13,155
93.9%
$803
32
9,428
93.2%
$770
1
314
94.3%
$443
35
10,937
93.9%
$831
35
10,937
93.0%
$783
1
314
92.4%
$596
1
314
93.0%
$546
N/A
550
937
3,580
$886
$96
515
847
1,177
2,313
$457,851
200,000
2,000
0.60
$623,174
0.63
$682,050
29,000
0.69
330
$481,943
0.67
-
$0
0.00
(1) Miramar was purchased October 31, 2013. "FY 2013" shown above is for November-December 2013 only.
(2) Indicative coverage ratio of FFO/AFFO per common share over quarterly dividend declared per common share.
(3) Inclusive of all full and partial interior upgrades completed through June 30, 2016 and 2015.
4
Consolidated Statement of Operations
In thousands, except for per share data
Revenues
Rental income
Other income
Total Revenues
Operating Expenses
Property operating expenses
Acquisition costs
Real estate taxes and insurance
Property management fees (related party)
Advisory and administrative fees (related party)
Corporate general and administrative expenses
Property general and administrative expenses
Depreciation and amortization
Total Expenses
Operating Income (loss)
Interest expense
Gain on sales of real estate
Net Income (loss)
Net Income (loss) attributable to noncontrolling interests
Net Income (loss) attributable to common stockholders
Other comprehensive income (loss)
Net losses related to interest rate cap valuations
Total comprehensive income (loss)
Comprehensive income (loss) attributable to noncontrolling interests
Comprehensive income (loss) attributable to common stockholders
Common shares outstanding - diluted
Q2 2016
Q2 2015
FY 2015
FY 2014
FY 2013 (1)
$29,404
4,253
$33,657
$25,528
3,219
$28,747
$103,804
13,854
$117,658
38,578
4,572
$43,150
$284
32
$316
$9,691
4,090
1,013
1,630
844
1,612
8,084
$26,964
$8,293
238
3,577
858
1,439
831
1,488
10,050
$26,774
$34,252
2,975
15,231
3,501
5,565
2,455
5,401
40,801
$110,181
12,348
8,639
5,743
1,289
1,653
2,091
21,645
$53,408
$122
137
36
13
22
16
142
$488
$6,693
(6,467)
16,370
16,596
2,006
14,590
$0.69
$1,973
(4,239)
(2,266)
(12)
(2,254)
$7,477
(18,469)
(10,992)
(160)
(10,832)
($10,258)
(7,274)
(17,532)
(1,932)
(15,600)
($172)
(172)
(172)
(12)
$16,584
2,005
$14,579
(126)
(2,392)
(25)
(2,367)
(391)
(11,383)
(93)
($11,290)
(306)
(17,838)
(1,962)
($15,876)
(172)
($172)
21,294
21,294
21,294
21,294
21,294
21,294
21,294
21,294
21,294
21,294
5
Reconciliation of Net Income (Loss) to FFO, AFFO, and NOI
In thousands, except for per share data
RECONCILIATION OF NET INCOME (LOSS) TO FFO & AFFO
Q2 2016
Q2 2015
FY 2015
FY 2014
FY 2013 (1)
Net income (loss)
Add:
Gain on eminent domain
Adjustment for noncontrolling interests
$16,596
($2,266)
($10,992)
($17,532)
8,084
(16,370)
(1,120)
10,050
(1,063)
40,801
(158)
(4,012)
21,645
(563)
142
-
FFO attributable to common stockholders
Add:
Acquisition costs
Gain on eminent domain
Amortization of deferred financing costs
Adjustment for noncontrolling interests
$7,190
$6,721
$3,550
($30)
$8,639
320
(1,048)
$137
-
AFFO attributable to common stockholders
FFO/AFFO per share
FFO
AFFO
Dividends declared per common share
FFO Coverage (2)
AFFO Coverage (2)
$0
659
16,370
(1,696)
$238
234
(49)
$25,639
$2,975
158
1,081
(365)
($172)
$22,523
$7,144
$29,488
$11,461
$107
21,294
21,294
21,294
21,294
21,294
$0.34
$1.06
$0.32
$0.34
$1.20
$1.38
$0.17
$0.54
($0.00)
$0.01
$0.206
1.64x
5.13x
$0.206
1.53x
1.63x
$0.618
1.95x
2.24x
$0.000
N/A
N/A
$0.000
N/A
N/A
RECONCILIATION OF NET INCOME (LOSS) TO NOI
Net income (loss)
Adjustments to reconcile net income (loss) to NOI:
Advisory and administrative fees
Non-recurring property general and administrative expenses
Interest expense
Acquisition Costs
$16,596
($2,266)
($10,992)
($17,532)
($172)
1,630
844
130
8,084
6,467
(16,370)
-
1,439
831
309
10,050
4,239
238
5,565
2,455
1,109
40,801
18,469
2,975
1,653
415
21,645
7,274
8,639
22
142
137
Net operating income (NOI)
$17,381
$14,840
$60,382
$22,094
$129
(2) Indicative coverage ratio of FFO/AFFO per common share over quarterly dividend declared per common share.
6
Balance Sheet
In thousands
ASSETS
Operating Real Estate Investments
Operating properties, net
Real estate assets held for sale, net
Total Net Real Estate Investments
Cash and cash equivalents
Restricted cash (2)
Other assets, net
Total Assets
LIABILITIES AND EQUITY
Mortgage loan payables, net
Mortgage payables held for sale, net
Credit facility, net
Bridge facility, net
Accounts payable and other accrued liabilities
Accrued real estate taxes payable
Other payables due to affiliates
Accrued interest payable
Security deposits liability
Prepaid rents
Total Liabilities
NexPoint Residential Trust, Inc. stockholders' equity:
Preferred stock
Common stock
Additional paid-in capital
Accumulated deficit
Accumulated other comprehensive loss
Common stock held in treasury at cost
Noncontrolling interest
Total Equity
Total Liabilities and Equity
Share Count Details
Weighted average common shares outstanding - basic
Dilution
Weighted average common shares outstanding - diluted
Q2 2016
FY 2015
FY 2014
FY 2013 (1)
$768,716
81,090
$849,806
28,550
34,200
4,876
$917,432
$902,882
$902,882
16,226
46,869
4,083
$970,060
$628,526
$628,526
12,662
47,817
3,720
$692,725
$388,337
65,726
196,290
1,972
3,789
5,988
1,031
1,324
1,231
$665,688
$676,324
28,805
5,106
6,057
1,462
1,544
1,824
$721,122
$482,344
5,642
3,859
20
1,031
1,513
792
$495,201
15
3
26
24
68
213
240,625
(12,791)
(737)
(88)
24,522
$251,744
$917,432
213
240,625
(18,593)
(697)
27,390
$248,938
$970,060
176,549
(306)
21,281
$197,524
11,163
$11,163
21,294
21,294
21,294
21,294
21,294
21,294
21,294
21,294
$692,725
$8,973
$8,973
190
2,035
34
$11,232
$11,232
(1) Miramar was purchased October 31, 2013.
(2) Includes approximately $15.8M reserved for value-add upgrades as of June 30, 2016.
7
Joint Venture Details
In thousands, except for property and unit data
# of Properties
# of Units
NXRT Ownership Percentage
Balance Sheet Information as of 6/30/16
ASSETS
Real estate assets
Total Gross Operating Real Estate Investments
Accumulated depreciation and amortization
Total Net Operating Real Estate Investments
Real estate held for sale, net
Total Net Real Estate Investments
Cash and cash equivalents
Restricted cash
Other assets, net
Total Assets
LIABILITIES
Mortgages payable, net
Mortgages payable held for sale, net
Credit faciility, net
Bridge facility, net (1)
Other liabilities
Total Liabilities
Statement of Operations For Quarter Ending 6/30/16
Total Revenues
Total Property Operating Expenses (2)
Net Operating Income (NOI)
NXRT's Share of NOI (Loss)
Reconciliation of NOI to Net income (loss)
Advisory and administrative fees (3)
Corporate general and administrative expenses (3)
REIT level interest expense (3)
Interest expense
Net income (loss)
Wholly Owned
Portfolio
1
314
100%
NXRT/BH
Portfolio
35
11,084
91%
NXRT/BH/Other
Portfolio
3
878
80%
Consolidated
Total
39
12,276
90%
$10,987
(1,034)
9,954
9,954
283
190
63
$10,490
$786,755
(45,056)
741,699
20,086
761,785
27,325
30,268
4,603
$823,980
$17,763
(699)
17,064
61,005
78,068
942
3,741
210
$82,962
$815,504
(46,788)
768,716
81,090
849,806
28,550
34,200
4,876
$917,432
$8,256
253
$8,509
$366,611
14,676
196,290
1,972
12,267
$591,816
$13,470
51,050
843
$65,363
$388,337
65,726
196,290
1,972
13,363
$665,688
$601
307
$294
$30,416
14,741
$15,675
$2,640
1,228
$1,412
$33,657
16,276
$17,381
-
(120)
(7,626)
(5,810)
16,370
$18,489
-
($1,630)
(844)
(387)
(130)
(8,084)
(6,080)
16,370
$16,596
(7)
(147)
(61)
$79
(3)
(311)
(209)
$889
(1) The Bridge Facility is recourse to the Company and is secured by the Company's equity interests in Madera Point and The Pointe at the Foothills.
(2) Includes property operating expenses, real estate taxes and insurance, property management fees, and property general and administrative expenses.
(3) Management does not allocate advisory and administrative fees or corporate general and administrative expenses to individual properties and therefore, only consolidated
totals are shown for these categories; REIT level interest expense relates to debt held at the corporate level.
8
Components to Net Asset Value
$ amounts in thousands, except for per share data
Ownership
Est. % NOI
Property
(pro rata %)
Contribution
Texas
92%
28.1%
Dallas
90%
2.7%
Houston
Cap Rate Range (1)
Min
Max
Value Range (pro rata) (2)
Min
Max
5.8%
6.3%
6.3%
6.8%
$280,284
$24,046
$313,617
$26,734
NAV Summary
Min
Max
Component
Tangible Assets (pro rata)
$965,793
$1,079,480
Real Estate
34,573
Cash(4)
17,378
Other Tangible Assets (at Book)
North Carolina
Charlotte
90%
4.8%
5.8%
6.3%
$46,968
$52,554
Value of Assets (pro rata)
Georgia
Atlanta
90%
21.8%
6.0%
6.5%
$205,676
$229,369
Tennessee
Nashville
90%
9.0%
5.8%
6.3%
$87,947
$98,406
Tangible Liabilities
Credit Facility
Mortgage Notes Payable
Total Debt Outstanding
Florida
Jacksonville
Orlando
Tampa
West Palm Beach
90%
90%
90%
90%
2.7%
8.6%
4.5%
2.3%
6.0%
5.8%
6.0%
5.8%
6.5%
6.3%
6.5%
6.3%
$25,857
$84,611
$42,239
$22,463
$28,835
$94,674
$47,104
$25,134
Washington D.C.
Other
80%
8.7%
6.0%
6.5%
$73,090
$81,510
Arizona
Phoenix
95%
6.7%
5.5%
6.0%
$72,613
$81,544
Total / Ave
90%
100.0%
5.8%
6.3%
$965,793
$1,079,480
4Q 2015 NOI Actual
1Q 2016 NOI Actual
2Q 2016 NOI Actual
NOI ESTIMATE
Estimated 3Q 2016 NOI Range (3)
FY 2016 NOI Guidance (3)
Low
16,900
$68,000
$16,645
17,678
17,381
Other Tangible Liabilities (at Book)
Minority partners' share of liabilities (5)
$1,017,744
$1,131,431
$200,000
457,851
657,851
11,101
65,184
Value of Liabilities (pro rata)
Net Leverage (mid-point)
$603,768
$603,768
56%
Net Asset Value (pro rata)
$413,976
Common shares outstanding - basic
Dillution
Est. NAV / Share
$527,663
21,294
0
0
$19.44
$24.78
IMPLIED VALUATION METRICS
$965,793
$1,079,480
Implied Real Estate Value (pro rata)
10%
Add Back NCI
High
17,400
$70,000
Implied Real Estate Value
No of Units (Jun. 30, 2016)
Implied Value/Apartment Unit
$1,071,640 $1,197,787
12,276
$87.3
$97.6
(1) Management estimates based on independent third party review of our properties.
(2) 2016 Full Year Guidance assumes we own all properties as of June 30, 2016 for the full year 2016.
(3) The Company anticipates net income (loss) will be in the range between $(0.7) million to $(2.7) million for the full year and between $(0.5) million to $0.5 million for the third
quarter of 2016, excluding gain on sales of real estate which is anticipated to be approximately $16.4 million for the full year 2016 and $0.0 million for the third quarter 2016.
(4) Includes cash & cash equivalents and approximately $15.8M that is held for value-add upgrades.
(5) Minority partners' share of liabilities excludes a $9M portion of the Credit Facility the Company used to pay down the Bridge Facility.
9
Portfolio Operating Metrics
In thousands, except for unit counts, all numbers @ 100% ownership
Owned Properties
Unit Count
Ownership
by Market (1)
(%)
Portfolio
Total
Average Rental Rates
Q2 2016
Q2 2015
Occupancy
% Change
Q2 2016
Q2 2015
Total Rental Revenue
bps ∆
Q2 2016
Q2 2015 (2)
% Change
Texas
Dallas
Houston
Average/Total
92%
90%
92%
4,084
240
4,324
$766
1,037
781
$733
972
748
4.5%
6.8%
4.4%
93.3%
93.3%
93.3%
92.9%
97.9%
93.2%
41 bps
-458 bps
11 bps
$8,702
688
9,390
$7,422
656
8,078
17.2%
4.9%
16.2%
North Carolina
Charlotte
Average/Total
90%
90%
577
577
860
860
803
803
7.0%
7.0%
94.8%
94.8%
94.3%
94.3%
52 bps
52 bps
1,386
1,386
1,251
1,251
10.8%
10.8%
Georgia
Atlanta
Average/Total
90%
90%
2,612
2,612
818
818
753
753
8.7%
8.7%
93.6%
93.6%
93.1%
93.1%
54 bps
54 bps
5,857
5,857
5,348
5,348
9.5%
9.5%
Tennessee
Nashville
Average/Total
90%
90%
1,038
1,038
840
840
770
770
9.0%
9.0%
94.6%
94.6%
94.7%
94.7%
-10 bps
-10 bps
2,394
2,394
2,242
2,242
6.8%
6.8%
Florida
Jacksonville (2)
Orlando
Tampa
West Palm Beach
Average/Total
90%
90%
90%
90%
90%
435
830
576
222
2,063
731
974
814
986
878
690
940
751
0
732
5.9%
3.6%
8.4%
N/A
20.1%
96.3%
93.3%
94.6%
94.6%
94.4%
92.9%
94.0%
93.2%
96.4%
93.8%
345 bps
-72 bps
139 bps
-180 bps
63 bps
897
2,281
1,280
618
5,077
811
2,100
1,202
476
4,589
10.6%
8.7%
6.5%
29.8%
10.6%
Washington D.C.
Other
Average/Total
80%
80%
878
878
976
976
980
980
-0.5%
-0.5%
94.3%
94.3%
91.2%
91.2%
308 bps
308 bps
2,389
2,389
2,260
2,260
5.7%
5.7%
Arizona
Phoenix
Average/Total
95%
95%
784
784
809
809
0
N/A
N/A
N/A
91.5%
91.5%
0.0%
N/A
N/A
N/A
1,731
1,731
0
0
90%
12,276
5.2%
93.7%
93.3%
37 bps
$28,224
$23,768
Average/Total:
$830
$789
N/A
N/A
18.8%
(1) Excludes properties sold during the quarter: Meridian (Austin) was sold on May 10, 2016 and Mandarin Reserve and Park at Regency (Jacksonville) were sold on June 6, 2016.
(2) Only includes partial months for acquisitions made during the quarter.
10
Same Store Results
In thousands, except for unit counts
Same Store Portfolio Details
Same Store Total Units
Same Store Occupied Units
Same Store Ending Occupancy
Same Store Average Rent per Unit
Q2 2016 (1)
10,937
10,271
93.9%
$831
Q2 2015 (1)
10,937
10,176
93.0%
$783
% Change
0.9%
87 bps
6.1%
FY 2015 (2)
314
290
92.4%
$596
FY 2014 (2)
314
292
93.0%
$546
% Change
-0.7%
-64 bps
9.0%
Same Store Rental Income
Same Store Other Income
Same Store Total Revenues
$25,189
3,671
$28,860
$23,291
2,907
$26,198
8.1%
26.3%
10.2%
$1,979
263
$2,242
$1,730
214
$1,944
14.4%
22.9%
15.3%
Same Store Property Operating Expenses Detail
Payroll
Repairs & Maintenance
Utilities
Real Estate Taxes
Insurance
Property Management Fees (related party)
Office Operations
Marketing
Total Same Store Property Operating Expenses
$3,424
2,532
2,157
3,009
514
866
859
365
$13,726
$3,207
2,257
2,049
2,600
602
782
721
350
$12,568
6.8%
12.2%
5.3%
15.7%
-14.6%
10.7%
19.2%
4.3%
9.2%
$337
211
196
176
42
78
81
27
$1,147
$335
196
182
167
82
77
74
14
$1,127
0.5%
7.8%
7.6%
5.1%
-49.1%
0.9%
9.5%
93.4%
1.7%
Same Store Net Operating Income (Same Store NOI)
$15,133
$13,630
11.0%
$1,096
$817
34.2%
Reconciliation of Net income (loss) to Same Store NOI
Net income (loss)
Adjustments to reconcile net income (loss) to NOI:
Interest expense
Acquisition Costs
Net Operating Income
Less Non-Same Store
Revenues
Operating Expenses
Same Store NOI
Q2 2016 (1)
Q2 2015 (1)
FY 2015 (2)
FY 2014 (2)
$16,596
($2,266)
($10,992)
($17,532)
1,630
844
130
8,084
6,467
(16,370)
17,381
1,439
831
309
10,050
4,239
238
14,840
5,565
2,455
1,109
40,801
18,469
2,975
60,382
1,653
415
21,645
7,274
8,639
22,094
(4,797)
2,549
$15,133
(2,549)
1,339
$13,630
(115,416)
56,129
$1,096
(41,206)
19,929
$817
(1) For the second quarter of 2016, our same store pool consisted of 35 properties: Miramar, Arbors on Forest Ridge, Cutter's Point, Eagle Crest, Silverbrook, Timberglen, Toscana, The Grove at Alban, Willowdale
Crossing, Edgewater at Sandy Springs, Beechwood Terrace, Willow Grove, Woodbridge, Abbington Heights, Colonial Forest, Courtney Cove, Park at Blanding, The Summit at Sabal Park, Jade Park, Timber Creek,
Belmont at Duck Creek, Radbourne Lake, The Arbors, The Knolls, The Crossings at Holcomb Bridge, The Crossings, Regatta Bay, Sabal Palm at Lake Buena Vista, Southpoint Reserve at Stoney Creek, McMillan
Place, Cornerstone, Barrington Mill, Dana Point, Heatherstone, and Versailles.
(2) Miramar was purchased October 31, 2013 and it is the only property eligible for a full year same-store comparison.
11
Historical Capital Expenditures
In thousands
Q2 2016
Capital Expenditures
Acquisition Capital Expenditures
Rehab Capital Expenditures (1)
Total Capital Expenditures
Q2 2015
$0
5,996
$5,996
% Change
FY 2015
-100.0%
-26.3%
-79.4%
$21,000
8,141
$29,141
FY 2014
$277,434
35,097
$312,531
% Change
-55.6%
165.7%
-51.0%
$624,325
13,209
$637,534
Capital Expenditures
In Millions
Acquistion
Historical Cap Ex Composition
(Oct '13 - Jun '16)
Rehab
6%
94%
$285
$151
$148
$75
$9
$0.2
4Q13
$0.6
1Q14
$41
$0.8
2Q14
$4.8
$7.1
3Q14
4Q14
(1) Includes interior, exterior, and common area capital expenditures.
12
$162
$7.4
1Q15
$21
$8.1
2Q15
$10.5
3Q15
$0
$19
$0
$7.6
$6.0
4Q15
1Q16
2Q16
$9.0
Outstanding Debt Details
In thousands and as of June 30, 2016
Property
Principal
Int. Rate
Max
Note Rate
Maturity Date
Recourse
Operating Properties - Fixed Rate First Mortgage Debt
Abbington Heights
Belmont at Duck Creek
Cornerstone
Total/Average
$10,305
11,246
23,283
$44,834
3.79%
4.68%
4.24%
4.25%
3.79%
4.68%
4.24%
4.25%
Sep-22
Sep-18
Mar-23
No
No
No
Operating Properties - Variable Rate First Mortgage Debt with Interest Rate Caps
Miramar
Courtney Cove
The Summit at Sabal Park
Timber Creek
Radbourne Lake
The Arbors
The Knolls
The Crossings at Holcomb Bridge
The Crossings
Sabal Palm at Lake Buena Vista
Southpoint Reserve at Stoney Creek
McMillan Place
Barrington Mill
Dana Point
Heatherstone
Versailles
Seasons 704
Total/Average
$8,400
14,210
14,287
19,482
19,213
5,812
16,038
12,450
15,874
37,680
13,600
15,738
43,500
12,176
7,087
19,623
12,660
$287,830
2.69%
2.55%
2.55%
2.29%
2.28%
2.28%
2.28%
2.28%
2.28%
2.28%
2.58%
2.39%
2.43%
2.52%
2.55%
2.50%
2.27%
2.39%
5.75%
5.75%
5.75%
5.96%
6.25%
7.11%
7.11%
7.35%
7.21%
6.26%
6.00%
5.92%
5.50%
5.50%
5.50%
5.50%
5.95%
6.08%
Feb-25
Sep-21
Sep-21
Oct-24
Oct-24
Nov-24
Nov-24
Nov-24
Nov-24
Dec-24
Jan-22
Feb-25
Mar-22
Mar-22
Mar-22
Mar-22
May-22
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
No
Operating Properties - Variable Rate First Mortgage Debt without Interest Rate Caps
Credit Facility (2)(3)(5)
Madera Point
The Pointe at the Foothills
Regatta Bay
Total/Average
$200,000
13,515
31,365
14,000
$258,880
2.67%
2.37%
2.36%
2.35%
2.60%
-
Jul-21
Sep-20
Sep-20
Sep-20
No
No
No
No
Held for Sale Properties - Variable Rate First Mortgage Debt with Interest Rate Caps
The Grove at Alban
Willowdale Crossings
Colonial Forest
Park at Blanding
Jade Park
Total/Average
Total/Average
13
$18,657
32,800
4,125
4,875
5,850
$66,307
3.01%
2.74%
2.63%
2.63%
2.62%
2.79%
6.50%
5.75%
6.25%
7.25%
6.49%
6.17%
$657,851
2.64%
-
Apr-21
Jun-21
Sep-21
Sep-21
Sep-21
No
No
No
No
No
Bridge Facility (1)
Capacity
Outstanding (3) (4)
Type
Letters of Credit
Remaining Capacity
Interest Rate Spread
Interest Rate
Maturity Date (4)
$29,000
$2,000
Floating
N/A
$27,000
4.00%
4.65%
Aug-16
Operating Properties Cross-Collateralized
as Security for the Credit Facility (3)
Arbors on Forest Ridge
Cutter's Point
Eagle Crest
Silverbrook
Timberglen
Toscana
Edgewater at Sandy Springs
Beechwood Terrace
Willow Grove
Woodbridge
The Place at Vanderbilt
Notes to Oustanding Debt Details
(1) The Bridge Facility is recourse to the Company and is
secured by the Company's equity interests in Madera Point and
The Pointe at the Foothills.
(2) On June 6, 2016, the Company, through certain of its
subsidiares, entered into a $200M credit facility (the “Credit
Facility”) with KeyBank National Association, as lender, which
was in turn assigned to the Federal Home Loan Mortgage
Corporation (“Freddie Mac”). The Credit Facility is a full-term,
interest-only facility and is expandable to $300M upon the
satisfaction of certain conditions. The initial term of the Credit
Facility is 60 months, and the Company has one 12-month
extension option. Interest accrues on the Credit Facility at an
interest rate of one-month LIBOR plus 2.20%. The Credit
Facility contains flexible prepayment options that are consistent
with the Company’s other floating rate indebtedness held by
Freddie Mac.
(3) On June 6, 2016, the Company drew $191.0 million under
the Credit Facility to replace the existing mortgage debt on 11
properties (shown above). The refinancing of this existing
mortgage debt did not incur prepayment penalties. The
Company subsequently drew an additional $9.0 million under
the Credit Facility and used the proceeds to pay down a portion
of its bridge facility.
(4) On August 2, 2016, the Company retired the bridge facility
using proceeds from dispositions and available cash.
(5) See page 14 for updated hedging activity following quarter
N/A
Debt Maturity Schedule
Debt Maturities and Principal Payments
In thousands
Operating Properties
Fixed Debt
Floating Debt
Total Operating Properties Debt
2016
$399
$399
Bridge Facility
Total Bridge Facility
2,000
$2,000
Credit Facility
Total Credit Facility
7%
30%
Thereafter
Total
$678
5,911
$6,588
$702
64,862
$65,564
$30,634
269,988
$300,622
$0
$0
$0
$0
$0
$0
200,000
$200,000
2,000
$393,544
1,558
$1,558
59,703
$59,703
66,307
$66,307
-
$0
-
$0
1,475
$1,475
$2,896
-
$0
1,519
$1,519
$18,383
Fixed Rate Debt
$600,000
2020
$11,593
5,315
$16,908
1,433
$1,433
$3,018
2019
$634
829
$1,463
-
619
$619
Total Consolidated Debt
2018
-
$0
Held For Sale Properties
Fixed Debt
Floating Debt
Total Held For Sale Debt
Debt Composition (1)
2017
$8,107
$67,122
-
$560,325
Debt Maturity Schedule (1)
Credit Facility
Floating Rate Debt
$44,640
346,905
$391,544
200,000
$593,544
$659,851
$560,325
$500,000
63%
$400,000
$300,000
$200,000
$100,000
$0
$3,018
$2,896
$18,383
2016
2017
2018
$8,107
2019
$67,122
2020
Thereafter
(1) In order to fix a portion of, and mitigate the risk associated with, the Company’s floating rate indebtedness (without incurring substantial prepayment penalties or defeasance costs typically
associated with fixed rate indebtedness), the Company entered into three interest rate swap transactions with KeyBank with a combined notional amount of $300.0 million. The interest rate swaps
effectively replace the floating interest rate with respect to that amount with a weighted average fixed rate of 1.0088%. The interest rate swaps have an effective date of July 1, 2016 and a termination
date of June 1, 2021. Beginning on August 1, 2016, the Company will be required to make monthly fixed rate payments of a weighted average fixed rate of 1.0088% calculated on a combined notional
amount of $300.0 million, while the counterparties will be obligated to make monthly floating rate payments based on one-month LIBOR to the Company referencing the same notional amount.
14
Acquisition Details
In thousands, excluding unit counts and investment per unit
Q4 2013
Miramar
Acquisition History
Q1 2014
Cutter's Point
Eagle Crest
Meridian (3)
Silverbrook
Timberglen
Toscana
The Grove at Alban (2)
Q2 2014
Willowdale Crossing (2)
Q3 2014
Edgewater at Sandy Spings
Beechwood Terrace
Willow Grove
Woodbridge
Abbington Heights
Colonial Forest (2)
Courtney Cove
Park at Blanding (2)
Park at Regency (3)
Jade Park (2)
Mandarin Reserve (3)
Timber Creek
Radbourne Lake
Q4 2014
The Arbors
The Knolls
The Crossings
Regatta Bay
Q1 2015
Cornerstone
McMillan Place
Barrington Mill
Dana Point
Heatherstone
Versailles
Q2 2015
Seasons 704
Q3 2015
Madera Point
Pointe at the Foothills
Q4 2015
Total/Wtd. Avg.
(1) Includes interior and exterior rehab
(2) Held for Sale
(3) Properties sold as of June 30, 2016
15
Acquisitions
Occupancy
at Acquisiton
Location
Ownership
%
Richardson, TX
100%
314
95.9%
10/31/2013
$8,875
$2,151
$11,026
$35,115
Bedford, TX
Richardson, TX
Irving, TX
Austin, TX
Grand Prairie, TX
Dallas, TX
Dallas, TX
Frederick, MD
90%
90%
90%
90%
90%
90%
90%
76%
210
196
447
200
642
304
192
290
93.8%
93.4%
95.1%
95.5%
93.8%
94.7%
93.8%
93.4%
1/31/2014
1/31/2014
1/31/2014
1/31/2014
1/31/2014
1/31/2014
1/31/2014
3/10/2014
12,805
15,845
27,325
12,300
30,400
16,950
8,875
23,050
1,449
1,357
1,120
1,247
1,661
1,013
1,077
1,704
14,254
17,202
28,445
13,547
32,061
17,963
9,952
24,754
67,877
87,765
63,636
67,737
49,939
59,089
51,835
85,357
Frederick, MD
80%
432
95.1%
5/15/2014
41,000
2,033
43,033
99,613
Atlanta, GA
Antioch, TN
Nashville, TN
Nashville, TN
Antioch, TN
Jacksonville, FL
Tampa, FL
Orange Park, FL
Jacksonville, FL
Tampa, FL
Daytona Beach, FL
Jacksonville, FL
Charlotte, NC
Garland, TX
Charlotte, NC
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
760
300
244
220
274
174
324
117
159
252
144
520
352
240
225
95.8%
97.3%
96.3%
95.0%
96.4%
91.4%
96.3%
94.9%
96.2%
98.4%
96.5%
95.8%
96.9%
96.3%
93.8%
7/18/2014
7/21/2014
7/21/2014
7/21/2014
8/1/2014
8/20/2014
8/20/2014
8/20/2014
8/20/2014
8/20/2014
8/20/2014
9/15/2014
9/30/2014
9/30/2014
9/30/2014
58,000
21,400
13,750
16,000
17,900
5,500
18,950
6,500
8,300
19,050
7,800
26,200
22,750
18,525
24,250
5,281
1,815
2,116
1,641
1,617
888
1,691
898
923
1,656
935
3,319
4,334
1,174
1,438
63,281
23,215
15,866
17,641
19,517
6,388
20,641
7,398
9,223
20,706
8,735
29,519
27,084
19,699
25,688
83,264
77,382
65,024
80,188
71,231
36,713
63,708
63,231
58,007
82,165
60,656
56,767
76,942
82,079
114,167
Tucker, GA
Marietta, GA
Roswell, GA
Marietta, GA
Seabrook, TX
Orlando, FL
Fredericksburg, VA
90%
90%
90%
90%
90%
90%
85%
140
312
268
380
240
400
156
94.3%
94.9%
94.0%
96.8%
88.8%
95.3%
93.6%
10/16/2014
10/16/2014
10/16/2014
10/16/2014
11/4/2014
11/5/2014
12/18/2014
7,800
21,200
16,000
21,200
18,200
49,500
17,000
1,340
2,059
2,220
2,220
1,987
1,346
1,737
9,140
23,259
18,220
23,420
20,187
50,846
18,737
65,285
74,549
67,986
61,632
84,112
127,114
120,110
Orlando, FL
Dallas, TX
Marietta, GA
Dallas, TX
Dallas, TX
Dallas, TX
90%
90%
90%
90%
90%
90%
430
402
752
264
152
388
95.3%
93.5%
94.0%
92.8%
95.4%
92.8%
1/15/2015
1/15/2015
2/6/2015
2/26/2015
2/26/2015
2/26/2015
31,550
20,984
58,000
16,235
9,450
26,165
2,662
3,011
6,688
2,165
1,648
3,917
34,212
23,995
64,688
18,400
11,098
30,082
79,562
59,688
86,021
69,698
73,015
77,530
West Palm Beach, FL
90%
222
98.2%
4/15/2015
21,000
1,900
22,900
103,154
Mesa, AZ
Phoenix, AZ
95%
95%
256
528
96.9%
96.4%
8/5/2015
8/5/2015
22,525
52,275
1,808
1,372
24,333
53,647
95,049
101,604
Fort Worth, TX
95%
333
91.6%
10/30/2015
90%
Units
13,155
95.0%
Transaction
Date
Purchase Price
19,250
$910,634
Investment
Rehab Budget(1)
4,592
$87,208
Total
23,842
$997,842
Per Unit
71,598
$75,853
Rehabilitation Details
In thousands, excluding unit counts
Rehabilitation Projects
In Process
Abbington Heights
Barrington Mill
Beechwood Terrace
Colonial Forest
Cornerstone
Courtney Cove
Cutter's Point
Dana Point
Eagle Crest
Edgewater at Sandy Springs
Heatherstone
Jade Park
Mandarin Reserve
Meridian
Miramar
Park at Blanding
Park at Regency
Radbourne Lake
Regatta Bay
Silverbrook
The Arbors
The Crossings
The Grove at Alban
The Knolls
Timber Creek
Timberglen
Toscana
Versailles
Willow Grove
Willowdale Crossing
Woodbridge
McMillan Place
Seasons 704
Madera Point
Total/Wtd. Avg.
Rehabilitation Projects
Planned
The Pointe at the Foothills
Total/Wtd. Avg.
Total/Wtd. Avg.
Location
Antioch, Tennessee
Bedford, Texas
Marietta, Georgia
Antioch, Tennessee
Dallas, Texas
Jacksonville, Florida
Orlando, Florida
Tampa, Florida
Richardson, Texas
Dallas, Texas
Irving, Texas
Atlanta, Georgia
Dallas, Texas
Daytona Beach, Florida
Austin, Texas
Richardson, Texas
Orange Park, Florida
Charlotte, North Carolina
Seabrook, Texas
Grand Prairie, Texas
Fredericksburg, Virginia
Tucker, Georgia
Marietta, Georgia
Roswell, Georgia
Frederick, Maryland
Marietta, Georgia
Tampa, Florida
Charlotte, North Carolina
Dallas, Texas
Dallas, Texas
Dallas, Texas
Nashville, Tennessee
Frederick, Maryland
Nashville, Tennessee
Dallas, Texas
Orlando, Florida
West Palm Beach, Florida
Mesa, Arizona
Fort Worth, Texas
Location
Phoenix, Arizona
Ownership
%
Units (1)
90%
12,627
Ownership
%
Units
95%
528
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
90%
100%
90%
90%
90%
90%
90%
85%
90%
90%
90%
76%
90%
90%
90%
90%
90%
90%
90%
80%
90%
90%
90%
90%
95%
95%
95%
90%
274
210
752
300
240
174
430
324
196
264
447
760
152
144
520
200
314
117
159
225
240
642
156
140
380
268
290
312
252
352
304
192
388
244
432
220
402
400
222
256
333
528
13,155
Rehabs In Process
Units
Rehab Units: Avg. Rent
Rehab Returns
Completed (2)
Pre-Rehab
Post-Rehab
Rent % Change
ROI (3)
3,580
$789
$886
12.6%
21.0%
107
82
151
74
94
60
95
86
83
100
68
194
100
42
119
93
33
34
43
162
123
161
47
54
176
127
77
151
117
44
82
82
124
74
34
61
82
58
34
34
18
Rehabs Planned
Units
Completed
-
-
3,580
$760
773
744
804
886
625
831
719
874
716
771
823
774
740
718
763
596
743
726
906
969
712
972
821
764
761
971
807
846
765
704
599
682
738
924
846
622
1099
1007
802
774
$854
859
890
897
993
672
918
814
992
787
862
932
889
833
802
822
651
823
815
985
1096
787
1158
899
860
838
1014
906
953
892
783
674
798
857
995
973
802
1229
1096
985
846
Projected Avg. Rent (4)
Pre-Rehab
Post-Rehab
810
$810
$790
860
$860
$885
12.3%
11.2%
19.7%
11.5%
12.0%
7.5%
10.4%
13.2%
13.6%
9.9%
11.7%
13.2%
14.8%
12.6%
11.8%
7.7%
9.2%
10.7%
12.3%
8.7%
13.1%
10.6%
19.1%
9.5%
12.5%
10.0%
4.5%
12.2%
12.7%
16.6%
11.1%
12.5%
17.0%
16.0%
7.7%
15.0%
28.9%
11.9%
8.8%
22.9%
9.3%
17.4%
23.9%
19.1%
16.8%
36.6%
25.0%
20.9%
24.9%
27.2%
16.7%
31.7%
19.0%
18.9%
21.3%
23.4%
20.7%
19.1%
18.6%
19.4%
65.5%
28.3%
21.3%
21.3%
18.3%
18.2%
16.1%
13.8%
20.0%
21.9%
31.5%
19.6%
21.8%
13.4%
25.2%
13.2%
17.1%
15.0%
68.8%
20.9%
26.0%
11.7%
Projected Rehab Returns (4)
Rent % Change
ROI
6.2%
6.2%
12.4%
TBD
TBD
TBD
Rehab Cost (3)
Avg. $/Unit
$5,127
4,155
8,663
6,120
3,395
2,187
5,026
4,445
4,927
4,296
3,144
6,183
3,925
5,297
4,432
3,335
3,294
5,128
5,565
1,025
4,249
3,755
6,254
4,790
4,655
5,510
4,391
5,706
4,459
4,634
4,916
4,230
5,477
5,576
6,154
7,188
5,459
1,356
5,220
3,386
7,493
$4,698
Rehab Cost
Avg. $/Unit
TBD
TBD
TBD
(1) We do not plan to upgrade 100% of the units at each of our properties
(2) Inclusive of all full and partial interior upgrades completed through June 30, 2016
(3) Inclusive of all full and partial interior upgrades completed and leased through June 30, 2016
(4) Properties sold as of June 30, 2016
(5) Year 1 estimates
16
Definitions
Funds from Operations (FFO):
FFO is defined in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income/(loss)
attributable to common shareholders (computed in accordance with Generally Accepted Accounting Principles, or "GAAP"), excluding real estate related depreciation and
amortization, excluding gains and losses from the cumulative effects of accounting changes, extraordinary items and sales of properties, and including adjustments for noncontrolling interests.
Adjusted Funds from Operations (AFFO):
AFFO is calculated by adjusting our FFO by adding back items that do not reflect ongoing property operations, such as acquisition expenses, equity-based compensation
expenses and the amortization of deferred loan costs. AFFO will also be adjusted to include any gains/(losses) from sales of property to the extent excluded from FFO and
exclude relevant noncontrolling interests.
Net Operating Income:
NOI is a non-GAAP financial measure of performance. NOI is used by investors and our management to evaluate and compare the performance of our properties, to
determine trends in earnings and to compute the fair value of our properties as it is not affected by (1) the cost of funds, (2) acquisition costs, (3) non-operating fees to
affiliates, (4) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net
income/(loss) computed in accordance with GAAP or (5) corporate general and administrative expenses and other gains and losses that are specific to us and (6) entity level
general and administrative expenses that are either non-recurring in nature or incurred on behalf of us at the property for expenses such as legal, professional and franchise
tax fees.
Same Store:
We define “same store” properties as properties that were in our portfolio on April 1, 2015 and June 30, 2016. There are thirty-five properties meeting this definition as of
June 30, 2016: Miramar, Arbors on Forest Ridge, Cutter's Point, Eagle Crest, Silverbrook, Timberglen, Toscana, The Grove at Alban, Willowdale Crossing, Edgewater at
Sandy Springs, Beechwood Terrace, Willow Grove, Woodbridge, Abbington Heights, Colonial Forest, Courtney Cove, Park at Blanding, The Summit at Sabal Park, Jade
Park, Timber Creek, Belmont at Duck Creek, Radbourne Lake, The Arbors, The Knolls, The Crossings at Holcomb Bridge, The Crossings, Regatta Bay, Sabal Palm at Lake
Buena Vista, Southpoint Reserve at Stoney Creek, McMillan Place, Cornerstone, Barrington Mill, Dana Point, Heatherstone, and Versailles.
17
Reconciliation of Guidance
Reconciliation of Guidance for Fully Year and Third Quarter 2016 NOI, FFO, and AFFO
The Company anticipates that net income (loss) will be in the range between $(0.7) million to $(2.7) million for the full year and between $(0.5) million to $0.5 million for the third quarter of 2016, excluding
gain on sales of real estate which is anticipated to be approximately $16.4 million for the full year 2016 and $0.0 million for the third quarter 2016. The difference between net income (loss) and FFO is
depreciation and amortization, which is anticipated to be $35.1 million to $36.1 million for the full year 2016. The difference between FFO and AFFO is amortization of deferred financing costs, to the extent
excluded from FFO, which is anticipated to total approximately $1.7 million for the full year 2016. The difference between net income (loss) and NOI is advisory and administrative fees, corporate general
and administrative expenses, non-recurring property general and administrative expenses, depreciation and amortization, interest expense, acquisition costs which are anticipated to total approximately
$69.7 million to $71.7 million for the full year and $16.9 million to $17.4 million for the third quarter of 2016. 2016 Full Year Guidance assumes we own all properties as of June 30, 2016 for the full year
2016.The Company expects approximately 21.3 million shares to be outstanding during 2016.
In thousands
RECONCILIATION OF NET INCOME (LOSS) TO NOI & SAME STORE NOI
Consolidated Net Income/(Loss)
Add:
Interest expense
Acquisition costs
Net Operating Income (NOI)
Less Non-Same Store
Revenues
Operating Expenses
Same Store NOI
18
FY 2014
FY 2015
Q2 2015
Unaudited
($2,266)
Q4 2015
Unaudited
($1,945)
Q1 2016
Unaudited
$291
($17,532)
($10,992)
1,653
0
415
21,645
7,274
8,639
-
5,565
2,455
1,109
40,801
18,469
2,975
-
1,439
831
309
10,050
4,239
238
-
1,395
807
595
10,005
5,600
188
-
1,616
782
151
9,612
5,226
-
$22,094
$60,382
$14,840
$16,645
$17,678
(41,206)
19,929
$817
(115,416)
56,129
$1,096
(2,549)
1,339
$13,630
Q2 2016
Unaudited
$16,596
1,630
844
130
8,084
6,467
(16,370)
$17,381
(4,797)
2,549
$15,133

Q2 2016 Supplement - Nexpoint Residential Trust

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