ARLINGTON, Va., Jan. 30 /PRNewswire/ -- Charles E. Smith Residential
Realty, Inc. (NYSE: SRW), the largest publicly traded multifamily real estate
investment trust focused on the greater Washington, D.C. region, announced
today that Funds From Operations (FFO) for 1996 increased 10% over 1995 and
that the Company's Board of Directors approved a follow-on common equity
offering, of at least 2.7 million shares, to fund two acquisitions presently
under contract.
The Board also approved the acquisition of the properties under contract,
two luxury high-rise apartment communities, for approximately $113 million.
These acquisitions will be purchased with a combination of Operating
Partnership Units and the assumption of debt, which will be partially repaid
with the follow-on offering proceeds. The economic impact from the two
acquisitions will be immediately accretive to FFO and, along with the equity
offering and issuance of Operating Partnership Units, will lower the Company's
overall debt to total market capitalization ratio from 46% to approximately
42%. The two properties, Crystal Plaza and Crystal Towers, comprise 1,452
apartment units and are located in Crystal City, Virginia. Underwriters for
the offering are Goldman, Sachs & Co.; Donaldson, Lufkin & Jenrette Securities
Corporation; Prudential Securities Incorporated; and Legg Mason Wood Walker,
Inc.
The Company's FFO for 1996 was $23.9 million, or $2.41 per share, a 10.0%
increase over the Company's FFO per share for 1995. For the quarter ended
December 31, 1996, FFO was $7.1 million, or $0.70 per share, up 11.1% over the
fourth quarter of 1995. FFO is widely considered to be the most appropriate
measure of a real estate investment trust's operating performance.
Ernest A. Gerardi, Jr., President of Charles E. Smith Residential Realty,
Inc., stated that, "We are quite pleased with our continued solid growth in
1996, which exceeded analysts' expectations. This performance is the result
of a combination of our acquisition and development programs, together with
operational initiatives that will continue to fuel growth in the years ahead.
The implementation of these initiatives positions us well for 1997 and
beyond."
The Company is structured as an umbrella partnership real estate
investment trust, or UPREIT. All property ownership and business operations
take place in an operating partnership and its subsidiaries and affiliates.
The Company currently owns approximately 45 %of the Operating Partnership and
is its sole general partner.
The Operating Partnership's total revenue from rental properties was
$166.3 million for 1996, an increase of 14.7% over 1995. For the fourth
quarter of 1996, revenue from rental properties increased 12.0% over the same
period last year.
The Operating Partnership's 1996 income from rental properties before
depreciation increased 14.2% from $79.3 million to $90.5 million. Income from
rental properties before depreciation for the fourth quarter of 1996 increased
12.7% to $24.3 million. The Property Service Businesses contributed income
before depreciation of $8.9 million in 1996 and $3.2 million in the fourth
quarter of 1996. For the twelve months ended December 31, 1996, the Property
Service Businesses provided 8.9% of the Operating Partnership's total income
before depreciation.
The Operating Partnership's earnings before interest, taxes, depreciation,
and amortization (EBITDA) increased 12.8% to $97.8 million in 1996. For the
fourth quarter of 1996, EBITDA increased 10.7% to $27.2 million.
The Company's net income for 1996 was $11.0 million, or $1.11 per share,
an increase of 37.0% over 1995. Net income for the fourth quarter was $5.0
million, or $0.49 per share, up 40.0% over the fourth quarter of 1995. Net
income in all periods reflect charges for quarterly distributions paid to
other operating partnership unitholders in excess of net income attributed to
these unitholders, because these unitholders' partnership interests are
carried at zero on the balance sheet. Such charges were $4.8 million in 1996
and $0.1 million for the fourth quarter, and it is important to note that they
have no effect on the Company's FFO.
The Company will hold a teleconference on Friday, January 31 at 11:00 a.m.
EST to review the information reported in this release. To participate,
please call 1-800-759-6338 shortly before 11:00 a.m. and identify yourself as
a participant in the Charles E. Smith Residential Realty teleconference.
Charles E. Smith Residential Realty, Inc. is a self-managed real estate
investment trust that is the largest publicly traded multifamily real estate
company focused on the greater Washington, D.C. region. The Company and its
subsidiaries and affiliates own, acquire, develop, and manage multifamily
residential, as well as provide related real estate services to other property
owners in the Washington region.
The total market capitalization of Charles E. Smith Residential Realty was
approximately $1.2 billion on December 31, 1996 based on a stock price of
$29.25.
This news release contains forward-looking statements regarding the
company's outlook, which are based on assumptions about economic and market
conditions, competitive dynamics and other factors subject to a number of
risks and uncertainties, some of which are discussed in the Company's filings
with the Securities and Exchange Commission. Actual results could differ
materially.
CHARLES E. SMITH RESIDENTIAL REALTY, INC.
Financial Highlights
For the Three and Twelve Months Ended December 31, 1996 and 1995
(dollars in 3 Months Ended 12 Months Ended
thousands except per December 31, December 31,
share data) % Change % Change
From From
1996 1995 Last Year 1996 1995 Last Year
Funds From Operations
of the Operating
Partnership $15,489 $13,691 13.1% $52,748 $47,311 11.5%
Funds From Operations
- attributable to
the Company 7,050 6,090 15.8% 23,869 20,391 17.1%
Per Share(a) $0.70 $0.63 11.1% $2.41 $2.19 10.0%
Net Income of the
Operating Partnership $11,034 $9,348 18.0% $34,817 $31,053 12.1%
Net Income
- attributable to
the Company 4,967 3,378 47.0% 10,977 7,529 45.8%
Per Share $0.49 $0.35 40.0% $1.11 $0.81 37.0%
Dividends Declared
per Share $0.505 $0.490 3.1% $1.990 $1.930 3.1%
EBITDA of the Operating
Partnership $27,174 $24,543 10.7% $97,769 $86,657 12.8%
Debt Composition as of 12/31/96
Dollars in % of
Thousands Total
Long Term Mortgage Debt
(maturities greater than 1 year)
Fixed Rate (rate: 8.05%) $399,563 73.1%
Variable Rate 0 0.0%
Short Term Mortgage Debt
(maturities less than 1 year)
Fixed Rate 0 0.0%
Variable Rate (rate: 7.20%) 17,245 3.2%
$100M Acquisition Line of Credit (rate: 7.16%) 82,050 15.0%
$83M Acquisition Line of Credit (rate: 7.27%) 30,000 5.5%
Construction Loan (rate: 7.32%) 17,686 3.2%
Total Debt $546,544 100.0%
Maturity Schedule
1997 116,981
1999 113,384
2001 125,214
2004 30,000
2009 148,095
2020 12,870
Average Interest Rate: 7.82%
Average Years to Maturity: 6.0
* As of 12/31/96, the Company's Debt to Total Market Capitalization Ratio
was 45.9%, based on 9,969,607 shares and 12,029,857 partnership units
outstanding at a stock price of $29.25.
* The Company's Debt Coverage Ratio for the 3 months ended 12/31/96 was
2.53:1.
(a) Weighted average shares, partnership units, and equivalents
outstanding during the periods were as follows:
Shares and equivalents 10,062,702 9,707,047 9,913,308 9,310,929
Partnership Units 11,960,203 12,115,528 11,994,324 12,292,066
Total Shares and
Partnership Units 22,022,905 21,822,575 21,907,632 21,602,995
CHARLES E. SMITH RESIDENTIAL REALTY, INC.
Operating Summary
For the Three and Twelve Months Ended December 31, 1996 and 1995
(dollars in thousands 3 Months Ended 12 Months Ended
except per share data) December 31, December 31,
% Change % Change
From From
Last Last
1996 1995 Year 1996 1995 Year
RENTAL PROPERTIES(a)
Revenue $43,469 $38,813 12.0% $166,283 $144,909 14.7%
Expenses
(excluding depreciation) (19,164) (17,238) 11.2% (75,779) (65,627) 15.5%
Income Before
Depreciation 24,305 21,575 12.7% 90,504 79,282 14.2%
PROPERTY SERVICE BUSINESSES
Engineering and
Technical Services 1,126 1,044 7.9% 3,663 3,485 5.1%
Property Management Services 392 692 -43.4% 2,296 2,008 14.3%
Financing Services 1,041 805 29.3% 1,953 1,579 23.7%
Interior Construction
and Renovation Services 665 511 30.1% 980 1,106 -11.4%
Income of the PSBs
Before Depreciation 3,224 3,052 5.6% 8,892 8,178 8.7%
Total Income Before
Depreciation 27,529 24,627 11.8% 99,396 87,460 13.6%
OTHER INCOME AND EXPENSES
Interest Income 303 425 -28.7% 1,029 1,424 -27.7%
Corporate General
and Administrative Expenses (818) (808) 1.2% (3,025) (2,842) 6.4%
Interest Expense
(including amort. of
financing costs) (11,358)(10,228) 11.0% (43,606) (37,421) 16.5%
Depreciation of
Real Property (4,455) (4,343) 2.6% (17,931) (16,258) 10.3%
Depreciation and
Amortization - PSBs (167) (325)-48.6% (1,046) (1,310) -20.2%
NET INCOME OF THE
OPERATING PARTNERSHIP 11,034 9,348 18.0% 34,817 31,053 12.1%
Interest of Other Operating
Partnership Unitholders (6,015) (5,189) 15.9% (19,062) (17,648) 8.0%
Distributions in Excess
of Earnings Allocated to
Other Operating Partnership
Unitholders (52) (781) -93.3% (4,778) (5,876) -18.7%
Attributable to
the Company $4,967 $3,378 47.0% $10,977 $7,529 45.8%
Net Income
per Share(b) $0.49 $0.35 40.0% $1.11 $0.81 37.0%
NET INCOME OF THE
OPERATING PARTNERSHIP 11,034 $9,348 18.0% $34,817 31,053 12.1%
Add: Depreciation of
Real Property 4,455 4,343 2.6% 17,931 16,258 10.3%
FFO OF THE OPERATING
PARTNERSHIP 15,489 13,691 13.1% 52,748 47,311 11.5%
Interest of Other Operating
Partnership
Unitholders (8,439) (7,601) 11.0% (28,879) (26,920) 7.3%
Attributable to
the Company $7,050 $6,090 15.8% $23,869 $20,391 17.1%
Funds From Operations
per Share(b) $0.70 $0.63 11.1% $2.41 $2.19 10.0%
(a) Details are shown on the following page.
(b) Weighted average shares, partnership units, and equivalents
outstanding during the periods were as follows:
Shares and equivalents 10,062,702 9,707,047 9,913,308 9,310,929
Partnership Units 11,960,203 12,115,528 11,994,324 12,292,066
Total Shares and
Partnership Units 22,022,905 21,822,575 21,907,632 21,602,995
CHARLES E. SMITH RESIDENTIAL REALTY, INC.
Rental Property Details
For the Three and Twelve Months Ended December 31, 1996 and 1995
3 Months Ended 12 Months Ended
December 31, December 31,
(dollars in thousands) % Change % Change
From From
Last Last
1996 1995 Year 1996 1995 Year
CORE RESIDENTIAL PORTFOLIO(a)
Revenue $33,266 $32,289 3.0% $132,111 $127,745 3.4%
Expenses (excluding
depreciation) (15,082) (14,625) 3.1% (61,248) (58,566) 4.6%
Income Before Depreciation 18,184 17,664 2.9% 70,863 69,179 2.4%
RETAIL PORTFOLIO
Revenue 2,619 2,692 -2.7% 10,176 10,418 -2.3%
Expenses (excluding
depreciation) (708) (895)-20.9% (3,567) (3,447) 3.5%
Income Before Depreciation 1,911 1,797 6.3% 6,609 6,971 -5.2%
SUB-TOTAL CORE PORTFOLIO
Revenue 35,885 34,981 2.6% 142,287 138,163 3.0%
Expenses (excluding
depreciation) (15,790)(15,520) 1.7% (64,815) (62,013) 4.5%
Income Before Depreciation 20,095 19,461 3.3% 77,472 76,150 1.7%
ACQUISITION PORTFOLIO
Revenue 6,482 3,179 N/A 19,914 5,831 N/A
Expenses (excluding
depreciation) (2,925) (1,373) N/A (9,324) (2,850) N/A
Income Before Depreciation 3,557 1,806 N/A 10,590 2,981 N/A
WESTERLY AT WORLDGATE
Revenue 1,102 653 N/A 4,082 915 N/A
Expenses (excluding
depreciation) (449) (345) N/A (1,640) (764) N/A
Income Before Depreciation 653 308 N/A 2,442 151 N/A
TOTAL PORTFOLIO
Revenue 43,469 38,813 12.0% 166,283 144,909 14.7%
Expenses (excluding
depreciation) (19,164)(17,238) 11.2% (75,779)(65,627) 15.5%
Income Before
Depreciation $24,305 $21,575 12.7% $90,504 $79,282 14.2%
(a) Includes Potomac View (192 units, acquired 8/94) and The Manor (435
units, acquired 8/94) for a total of 12,462 apartment units.
CHARLES E. SMITH RESIDENTIAL REALTY, INC.
Funds Available for Distribution (FAD) Calculation
For the Three and Twelve Months Ended December 31, 1996 and 1995
3 Months Ended Dec. 31, 12 Months Ended Dec. 31,
% Change % Change
(dollars in thousands From From
except per share data) 1996 1995 Last Year 1996 1995 Last Year
NET INCOME OF THE
OPERATING
PARTNERSHIP $11,034 $9,348 18.0% $34,817 $31,053 12.1%
Add: Depreciation
of Real
Property 4,455 4,343 2.6% 17,931 16,258 10.3%
FFO OF THE OPERATING
PARTNERSHIP $15,489 $13,691 13.1% $52,748 $47,311 11.5%
Add: Amortization
of Deferred
Financing
Costs 631 690 -8.6% 2,583 2,719 -5.0%
Depreciation and
Amortization -
PSBs 167 325 -48.6% 1,046 1,310 -20.2%
Reserve Fund
Reimbursements 0 176 -100.0% 398 995 -60.0%
Amortization
of Unit Grants 120 143 -16.1% 525 570 -7.9%
Less: Additions
to Rental
Property (a) (3,344) (2,665) 25.5% (7,298) (5,257) 38.8%
Principal
Curtailments
on Mortgage
Debt (103) (185) -44.3% (614) (466) 31.8%
Straight-Lining
of Retail Rents (249) (234) 6.4% (962) (1,065) -9.7%
FAD OF THE OPERATING
PARTNERSHIP 12,711 11,941 6.4% 48,426 46,117 5.0%
Interest of Other
Operating Partnership
Unitholders (6,927) (6,633) 4.4% (26,513) (26,240) 1.0%
Attributable
to the Company $5,784 $5,308 9.0% $21,913 $19,877 10.2%
Funds Available
for Distribution
per Share (b) $0.57 $0.55 3.6% $2.21 $2.13 3.8%
Dividend Declared
per Share $0.505 $0.490 3.1% $1.990 $1.930 3.1%
Payout Ratios
As a Percentage
of FAD 89% 89% -- 90% 91% --
As a Percentage
of FFO 72% 78% -- 83% 88% --
(a) Additions to Rental
Property details
are as follows:
Core Residential
Portfolio $2,682 $2,374 -- $5,806 $4,899 --
Retail Portfolio 80 9 -- 287 55 --
Acquisition
Portfolio 582 282 -- 1,205 303 --
Total Additions
to Rental
Property $3,344 $2,665 -- $7,298 $5,257 --
(b) Weighted average
shares, partnership
units, and equivalents
outstanding during
the periods were
as follows:
Shares and
equivalents 10,062,702 9,707,047 -- 9,913,308 9,310,929 --
Partnership
Units 11,960,203 12,115,528 -- 11,994,324 12,292,066 --
Total Shares
and Partnership
Units 22,022,905 21,822,575 -- 21,907,632 21,602,995 --
CHARLES E. SMITH RESIDENTIAL REALTY, INC.
Residential Portfolio Statistics for the Twelve Months Ended December 31, 1996
Number of Average Monthly Average
Property Type/ Property Apartment Sq. Ft. Revenue Economic
Property Name Location Units Per Unit Per Unit Occupancy
Core Residential
Portfolio
High-Rise
Albemarle Washington,
D.C. 235 1,097 1,126 99.3%
Calvert-Woodley Washington,
D.C. 136 1,001 1,046 99.8%
Cleveland House Washington,
D.C. 216 894 1,001 98.3%
Corcoran House Washington,
D.C. 138 464 757 99.5%
Courthouse Plaza Arlington,
VA 396 772 1,134 97.8%
Crystal House I Arlington,
VA 426 917 933 96.7%
Crystal House II Arlington,
VA 402 938 905 96.3%
Crystal Place Arlington,
VA 180 894 1,210 97.6%
Crystal Square Arlington,
VA 378 1,121 1,080 98.4%
Gateway Place Arlington,
VA 162 826 2,023 93.1%
Marbury Plaza Washington,
D.C. 672 997 621 95.3%
Skyline Towers Fairfax Co.,
VA 940 1,221 950 97.1%
Statesman Washington,
D.C. 281 593 739 98.6%
2501 Porter Washington,
Street D.C. 202 760 1,356 96.7%
Water Park Towers Arlington,
VA 360 881 1,486 97.8%
Sub-Total/Average 5,124 956 1,018 97.3%
Mid-Rise
Berkeley Arlington,
VA 138 891 704 97.6%
Columbian Arlington,
Stratford VA 227 942 719 98.2%
Executive Central Arlington,
VA 230 903 749 98.8%
Executive North Arlington,
VA 215 892 748 97.6%
Executive South Arlington,
VA 266 842 727 98.1%
Windsor Towers Arlington,
VA 280 1,025 760 96.9%
Sub-Total/Average 1,356 920 737 97.9%
Garden
Bedford Village Fairfax Co.,
VA 752 1,070 859 96.1%
Car Barn Washington,
D.C. 196 1,311 823 96.9%
Columbia Crossing Arlington,
VA 247 976 1,116 98.2%
Concord Village Arlington,
VA 531 1,025 762 93.9%
Fort Chaplin Washington,
D.C. 549 983 603 96.5%
The Manor Montgomery Co.,
MD 435 999 729 95.6%
Newport Village Alexandria,
VA 937 1,115 862 98.3%
Orleans Village Fairfax Co.,
VA 851 1,061 787 96.9%
Oxford Manor Washington,
D.C. 227 1,005 596 94.7%
Patriot Village Fairfax Co.,
VA 1,065 1,162 851 96.7%
Potomac View Loudoun Co.,
VA 192 965 708 97.8%
Sub-Total/Average 5,982 1,042 801 96.6%
12,462 994 883 97.0%
Residential Acquisition/
Development Portfolio
High-Rise
Suburban Tower Montgomery Co.,
(acquired l/95) MD 172 677 762 97.4%
Connecticut
Heights Washington,
(acquired 6/95) D.C. 519 536 761 95.9%
The Bennington Arlington,
(acquired 9/95) VA 348 804 986 97.3%
Van Ness South Washington,
(acquired 7/96) D.C. 625 956 N/A N/A
1841 Columbia
Road Washington,
(acquired 9/96) D.C. 115 634 N/A N/A
Sub-Total/Average 1,779 756 837 96.7%
Garden
Blvd. of Old Town/
Gov. Spotswood
(acquired Alexandria,
4/95, 3/96) VA 159 603 723 96.8%
Westerly
at Worldgate Fairfax Co.,
(opened 5/95) VA 320 921 1,063 92.8%
Oakwood Vienna,
(acquired 12/95) VA 218 968 1,001 93.9%
Charter Oak Reston,
(acquired 3/96) VA 262 1,097 N/A N/A
Sub-Total/Average 959 927 966 93.9%
2,738 816 899 95.5%
All Residential Properties 15,200 962 $884 96.9%
SOURCE Charles E. Smith Residential Realty, Inc.
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CONTACT:
Ernest A. Gerardi, Jr., 703-769-1000, or M.
Bruce Snyder, 703-769-1029, both of Charles E. Smith Residential
Realty
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