SAN DIEGO, May 10 /PRNewswire/ -- Burnham Pacific Properties, Inc.
(NYSE: BPP) today announced operating results for the quarter ended March 31,
1999, with improved leasing results.
The Company has executed leases for over 408,000 square feet during the
recent quarter, which exceeds the total square footage of leases signed during
all of 1998. Of the total, over 124,000 square feet was for space not
previously occupied, which is more than double the amount signed during the
previous quarter. Of the 124,000 square feet, the Company received revenue
from some 8,000 square feet during the first quarter and expects to receive
revenue from some 57,000 square feet sometime during the second quarter, at an
average rate of $12.70 per square foot; from some 12,000 square feet sometime
during the third quarter, at an average rate of $19.90 per square foot; and
from some 15,000 square feet sometime during the fourth quarter, at an average
rate of $15.00 per square foot.
Commenting on the first quarter's leasing results, David Martin, Burnham
Pacific's Chief Executive Officer, stated, "We are very pleased with the
results of our leasing efforts. The entire leasing team has done an
extraordinary job at exceeding our expectations. We continue to have over
670,000 square feet of vacancy, approximately six percent of the total
portfolio, to fill. This leasing momentum creates an exciting opportunity for
the Company."
For the quarter, Funds From Operations ("FFO") on a fully diluted basis
(assuming conversion of the Company's convertible preferred stock and other
common stock equivalents) was $13.7 million or $.33 per share, as compared to
$10.7 million or $.33 per share for the quarter ended March 31, 1998. FFO is
calculated based on the revised definition adopted by the Board of Governors
of the National Association of Real Estate Investment Trusts (NAREIT) and is
considered the primary earnings measure for equity REITs.
Commenting on the first quarter financial results, Mr. Martin added, "We
are also pleased with our financial results this quarter. Although we have
delayed our acquisitions for the year to the later quarters, we were able to
achieve our expected financial results through our operations. The
combination of continued operations success and the contracted acquisitions,
will well position us for the remainder of this year and into next."
Review of Results
For the quarter ended March 31, 1999, revenues grew $5.2 million to
$35.1 million, from $29.9 million in the first quarter of 1998. Net income
available to common stockholders before a $.06 per share cumulative effect of
a change in accounting principle was $2.2 million or $.07 per share (diluted),
as compared to $2.1 million or $.09 per share for the prior year period.
On April 3, 1998, the AIPCA Accounting Standards Executive Committee
issued Statement of Position 98-5 (SOP 98-5), "Reporting on the Costs of
Start-Up Activities," which is effective for fiscal years beginning after
December 15, 1998. SOP 98-5 requires the costs of start-up activities and
organization expenses to be expensed as incurred. The Company has implemented
SOP 98-5 in the first quarter of 1999. This initial application is reported
as a cumulative effect of change in accounting principle and represents costs
related to the Company becoming self-advised in 1991, the conversion to an
"UPREIT" structure in 1997, and the formation of its joint-venture with the
California Public Employees' Retirement System ("CalPERS") in 1998. Due to
the non-recurring nature of these expenses, the Company expects the impact
going forward of this change in accounting principle to be minimal.
The first quarter of 1999 was also impacted by a $1.5 million, one-time
restructuring charge related to the severance and related costs for employees
affected by the Company's recently announced decision to outsource its
property management function to third-party providers, and a one-time charge
of approximately $750,000 as a result of the cost associated with the
abandonment of transactions in process before the commitment of the AMB
portfolio acquisition. Net income available to common stockholders before the
cumulative effect of the change in accounting principles and prior to these
charges for the quarter ended March 31, 1999, was $4.4 million or $0.14 per
share. These charges were not included in the calculation of FFO which is
primarily a measure of operating performance.
AMB Portfolio Acquisition Update
In early March, the Company announced that BPP Retail, LLC, a
co-investment entity between Burnham Pacific and CalPERS, had entered into
agreements to acquire 28 shopping centers aggregating 5.1 million square feet
from AMB Property Corporation for $663.4 million. The centers are to be
acquired in three separate phases in each of the last three quarters of 1999.
Six additional centers totaling 1.5 million square feet are under contract
with Burnham Pacific for $284.4 million, subject to a financing confirmation.
BPP Retail, LLC has removed all its contingencies on the first three phases.
Per the terms of the agreement, AMB has elected a closing date for the first
phase of June 15, 1999.
Burnham Pacific is a real estate investment trust that focuses on
value-added retail real estate opportunities throughout the United States.
More information may be found by calling 800-462-5181 or visiting the
Company's web site at http://www.burnhampacific.com.
This news release contains forward-looking statements regarding future
events or financial performance of the Company. These statements are only
predictions and actual events or results may differ materially. Investors
should refer to the documents the Company files from time to time with the
Securities and Exchange Commission, specifically the cautionary statement
identifying certain factors that could affect future results included in the
"Risk Factors" section of the Company's most recently filed Registration
Statement and in the "Forward Looking Statements & Certain Risk Factors"
section of the Company's most recently filed Form 10K.
Consolidated Statements of Income
Quarter Ended
3/31/99 3/31/98
Revenues
Rents $34,435 $29,639
Fee Income 384 0
Interest 316 228
Total Revenues 35,135 29,867
Costs and Expenses
Interest 9,888 9,466
Rental Operating 9,374 8,252
General & Administrative 1,754 1,111
Restructuring Charge 1,500 0
Abandoned Acquisition Costs 748 0
Depreciation & Amortization 7,161 6,431
Total Costs and Expenses 30,425 25,260
Income from Operations before
Income (Loss) from Unconsolidated
Subsidiaries, Minority Interest
and Cumulative Effect of Change
in Accounting Principle 4,710 4,607
Income (Loss) from
Unconsolidated Subsidiaries (31) 95
Minority Interest (1,102) (1,166)
Income before Cumulative Effect of
Change in Accounting Principle 3,577 3,536
Cumulative Effect of Change
in Accounting Principle (1,866) 0
Net Income $1,711 $3,536
Dividends Paid to Preferred Stockholders (1,400) (1,400)
Income Available to Common Stockholders $311 $2,136
Basic Earnings Per Share:
Income before Cumulative Effect of
Change in Accounting Principle $0.07 $0.09
Cumulative Effect of Change
in Accounting Principle (0.06) 0.00
Net Income $0.01 $0.09
Diluted Earnings Per Share:
Income before Cumulative Effect of
Change in Accounting Principle $0.07 $0.09
Cumulative Effect of Change in
Accounting Principle (0.06) 0.00
Net Income $0.01 $0.09
Funds from Operations-Diluted:
Income before Cumulative Effect
of Change in Accounting Principle $3,577 $3,536
Adjustments:
Depreciation & Amortization of
Real Estate and Tenant Improvements 6,780 5,950
Restructuring Charge 1,500 0
Abandoned Acquisition Costs 748 0
Minority Interest 1,102 1,166
Funds from Operations-Diluted $13,707 $10,652
Funds from Operations Per Share
Basic $0.35 $0.34
Diluted $0.33 $0.33
Weighted Average Shares Outstanding-FFO
Basic 31,954,075 23,640,659
Diluted 41,664,479 32,265,779
CONSOLIDATED BALANCE SHEETS
3/31/99 12/31/98
ASSETS
Real Estate $1,142,778 $1,137,779
Less Accumulated Depreciation (86,480) (79,837)
Real Estate-Net 1,056,298 1,057,942
Cash and Cash Equivalents 3,326 20,873
Restricted Cash 9,085 7,737
Receivables-Net 6,889 7,697
Investment in Unconsolidated Subsidiaries 3,426 3,438
Other Assets 16,734 16,489
Total $1,095,758 $1,114,176
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts Payable and Other Liabilities $39,536 $50,572
Tenant Security Deposits 2,954 2,982
Notes Payable 396,149 394,029
Line of Credit Advances 179,803 180,999
Total Liabilities 618,442 628,582
Commitments and Contingencies
Minority Interest 69,707 70,217
Stockholders' Equity:
Preferred Stock, Par Value
$.01/Share, 5,000,000 Shares
Authorized, 4,800,000 Shares
Designated as Series 1997-A
Convertible Preferred,
2,800,000 Shares Outstanding
at March 31, 1999 and
December 31, 1998 28 28
Common Stock, Par Value $.01/Share,
95,000,000 Shares Authorized,
31,960,008 and 31,954,008 Shares
Outstanding at March 31, 1999
and December 31, 1998, Respectively 320 319
Paid in Capital in Excess of Par 525,266 524,957
Dividends Paid in Excess of Net Income (118,005) (109,927)
Total Stockholders' Equity 407,609 415,377
Total $1,095,758 $1,114,176
SOURCE Burnham Pacific Properties, Inc.
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Related links:
http://www.burnhampacific.com
CONTACT:
Daniel B. Platt, Chief Financial Officer of
Burnham Pacific Properties, Inc., 619-652-4700, fax 619-652-4711,
dbplatt@bpac.com
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