RADNOR, Pa., July 28 /PRNewswire-FirstCall/ -- Brandywine Realty
Trust (NYSE:BDN), a real estate investment trust focused on the
ownership, management and development of Class A, suburban and
urban office properties in the mid-Atlantic region and other
selected markets throughout the United States, announced today its
financial and operating results for the three and six-month periods
ended June 30, 2009. The highlights are as follows: Financial
Highlights - Second Quarter -- Net income allocated to common
shares totaled $3.5 million or $0.03 per diluted share in the
second quarter of 2009 compared to net income of $5.7 million or
$0.06 per diluted share in the second quarter of 2008. The second
quarter of 2009 included $12.0 million of gains on the early
extinguishment of debt and a charge of $1.2 million attributable to
discontinued operations, while the second quarter of 2008 included
$0.5 million of gains on the early extinguishment of debt and $8.5
million of income attributable to discontinued operations. Our
weighted average diluted share count increased to 102.7 million
shares in the second quarter of 2009 from 87.5 million shares in
the second quarter of 2008 due to our issuance of 40.25 million
common shares on June 2, 2009. -- Funds from operations available
to common shares and units (FFO) in the second quarter of 2009
totaled $59.2 million or $0.56 per diluted share compared to $50.4
million or $0.55 per diluted share in the second quarter of 2008
($57.3 million or $0.63 per diluted share excluding a $6.9 million
impairment charge). Our second quarter 2009 FFO payout ratio was
17.9% ($0.10 common share dividend paid / $0.56 FFO per share). Our
weighted average fully diluted share count for FFO (and CAD)
calculations increased to 105.6 million shares in the second
quarter of 2009 from 91.0 million shares in the second quarter of
2008 due to the aforementioned share issuance. -- In the second
quarter of 2009, we incurred $12.9 million of revenue maintaining
capital expenditures which along with our other adjustments to FFO,
resulted in $44.9 million of cash available for distribution (CAD)
or $0.43 per diluted share compared to $42.8 million of CAD or
$0.47 per diluted share in the second quarter of 2008 when we
incurred $9.3 million of revenue maintaining capital expenditures.
Our second quarter 2009 CAD payout ratio was 23.3% ($0.10 common
share dividend paid / $0.43 CAD per share). Financial Highlights -
Six Months -- Net income allocated to common shares totaled $0.7
million or $0.01 per diluted share in the first six months of 2009
compared to net income of $16.6 million or $0.19 per diluted share
in the first six months of 2008. The 2009 period included $18.7
million of gains on the early extinguishment of debt, $1.1 million
of termination revenues and a charge of $4.4 million attributable
to discontinued operations, while the 2008 period included $3.1
million of gains on the early extinguishment of debt, $4.1 million
of termination revenues and $19.6 million of income attributable to
discontinued operations. Our weighted average diluted share count
increased to 95.5 million shares in the first six months of 2009
from 87.3 million shares in the first six months of 2008 due to the
afore-mentioned common share issuance. -- FFO available to common
shares and units in the first six months of 2009 totaled $109.7
million or $1.12 per diluted share ($113.4 million or $1.15 per
diluted share excluding a $3.7 million impairment charge) compared
to $110.9 million or $1.22 per diluted share in the first six
months of 2008 ($117.8 million or $1.30 per diluted share excluding
a $6.9 million impairment charge). Our FFO payout ratio for the
first six months of 2009 was 35.7% ($0.40 common share dividend
paid / $1.12 FFO per share). Our weighted average fully diluted
share count for FFO (and CAD) calculations increased to 98.3
million shares for the first half of 2009 from 90.9 million shares
in the first half of 2008 due to the aforementioned share issuance.
-- During the first six months of 2009, we incurred $21.4 million
of revenue maintaining capital expenditures which along with our
other adjustments to FFO, resulted in $88.8 million of CAD or $0.90
per diluted share compared to $89.2 million of CAD or $0.98 per
diluted share for the first six months of 2008 when we incurred
$16.1 million of revenue maintaining capital expenditures. Our CAD
payout ratio for the first six months of 2009 was 44.4% ($0.40
common share dividend paid / $0.90 CAD per share). Portfolio
Highlights -- In the second quarter of 2009, our net operating
income (NOI) excluding termination revenues and other income items
decreased 4.0% on a GAAP basis and 1.0% on a cash basis for our 234
same store properties which were 89.7% and 92.9% occupied on June
30, 2009 and June 30, 2008, respectively. -- During the second
quarter of 2009, we completed 1,014,928 square feet of total
leasing activity including 520,002 square feet of renewals, 368,984
square feet of new leases and 125,942 square feet of tenant
expansions. We currently have an additional 1,937,788 square feet
of executed leasing which will commence subsequent to June 30,
2009. During the second quarter of 2009, we achieved a 67.1%
retention rate in our core portfolio with positive net absorption
of 52,553 square feet excluding 125,799 square feet of early
terminations, or 59.4% overall. During the second quarter of 2009,
we achieved a 3.4% increase on our renewal rental rates and a 7.8%
increase on our new lease and expansion rental rates, both on a
GAAP basis. -- At June 30, 2009, our core portfolio (excluding four
recently completed but not yet stabilized developments) was 89.7%
occupied and 90.9% leased (reflecting leases which will commence
after June 30, 2009). With the four recently completed developments
included, our core portfolio was 88.8% occupied and 90.8% leased at
June 30, 2009. We owned 247 properties at June 30, 2009,
encompassing 238 core properties aggregating 23.7 million square
feet and nine development/ redevelopment properties aggregating 2.3
million square feet. Investment Highlights -- In the second quarter
of 2009, we sold one property, generating $26.5 million of gross
consideration and bringing year to date sales to $36.6 million, or
just over 25% of our $145 million 2009 sales goal. Net of
transaction costs and a twelve month $1.0 million seller financing
on one of the earlier sales, we have realized $33.5 million of
aggregate net proceeds from these sales which we used for debt
repayments and other general corporate purposes. We currently have
approximately $300 million of sales transactions in the market with
$85 million of that under contract and $35 million in active
discussions with prospective buyers. -- At June 30, 2009, we were
proceeding on two developments and seven redevelopments with total
project costs of $455.1 million of which a total of $243.6 million
remained to be funded - $113.6 million in the remainder of 2009 and
$130.0 million in 2010. These amounts include $355.5 million of
total project costs for the combined 30th Street Post Office (100%
leased to the Internal Revenue Service) and Cira South Garage (up
to 94.3% leased to the Internal Revenue Service) in Philadelphia,
Pennsylvania of which $215.8 million remained to be funded at June
30, 2009. We are also finishing the lease-up of the four recently
completed developments for which we expect to spend up to an
additional $16.9 million, all in 2009. Capital Markets Highlights
-- During the second quarter of 2009, we completed a public
offering of 40,250,000 of our common shares at an offering price of
$6.30 per share, including 5,250,000 shares sold to the
underwriters to cover overallotments. The net proceeds from the
offering, after underwriting commissions, discounts and offering
expenses, totaled approximately $242.5 million which we used to
reduce outstanding borrowings under our unsecured revolving credit
facility and for general corporate purposes. -- During the second
quarter of 2009, we repurchased $88.0 million face amount of our
unsecured senior notes maturing in 2009, 2010, 2011 (our
exchangeable notes due 2026 with a put date in October 2011) and
2012 in open-market transactions and completed a tender for $34.5
million of our 2010 Notes generating aggregate gains of $12.0
million on the early extinguishment of debt. -- During the second
quarter of 2009, we closed an $89.8 million first mortgage
financing on Two Logan Square, a 702,006 square foot, 99.1% leased,
class A, office tower in Philadelphia, PA. The loan features a
7.57% rate and a seven-year term with three years of interest only
payments followed by a thirty-year amortization schedule. $68.6
million of the proceeds was used to repay without penalty the
balance of the former Two Logan first mortgage loan and $21.2
million was used for general corporate purposes including the
repayment of existing indebtedness. Subsequent to quarter end, we
closed a $60.0 million first mortgage financing on One Logan
Square, a previously unencumbered, 594,361 square foot, 99% leased,
class A, office tower in Philadelphia, PA. The loan features a
floating rate of LIBOR plus 350 basis points (subject to a LIBOR
floor) and a seven-year term with three years of interest only
followed by a thirty-year amortization schedule derived using a
7.50% rate. The net proceeds of the One Logan loan were used for
general corporate purposes including the repayment of existing
indebtedness. -- During the second quarter of 2009, we completed
definitive agreements for $256.5 million of aggregate forward
financing commitments on the 30th Street Post Office and Cira South
Garage projects in Philadelphia, Pennsylvania. The $256.5 million
of aggregate proceeds was funded by the underlying lenders and was
deposited along with our gross forward commitment fee of
approximately $17.7 million into an escrow account to be
administered by The Bank of New York Mellon, as trustee. The
interest earned on the escrow account and the forward commitment
fee will be used to pay the interest costs of the underlying loans
through August 26, 2010, the anticipated completion date of the
projects and the date on which the then remaining escrow balance of
$256.5 million is expected to be released to us. The loans bear
interest at 5.93% with interest-only through September 10, 2010
following which they will amortize monthly over a twenty-year
period beginning with the October 10, 2010 debt service payment.
The loans will be non-recourse and will be secured by mortgages on
the Post Office and Garage and by the leases of space at those
facilities upon completion of those projects by us and their
acceptance by the IRS for occupancy along with other customary
conditions, all expected to occur on or about August 26, 2010. --
At June 30, 2009, our net debt to gross assets measured 46.3%
compared to a peak of 54.3% at September 30, 2007, reflecting a
cumulative $753.9 million reduction in our net debt over that
twenty-one-month period. At June 30, 2009, we had $495.5 million
available for use and drawdown under our $600.0 million unsecured
revolving credit facility. -- We achieved a 2.8 times EBITDA
interest coverage ratio for the quarter ended June 30, 2009 versus
the 2.6 ratio we achieved for the quarter ended June 30, 2008. We
recorded a 6.1 net debt to annualized quarterly EBITDA ratio for
the quarter ended June 30, 2009. "Our common share equity issuance,
the finalization of the terms and escrow funding of the Post
Office/Garage financing, our property financings and sales and
steady property operations in the second quarter combined to
further strengthen Brandywine's financial foundation," stated
Gerard H. Sweeney, President and Chief Executive Officer of
Brandywine Realty Trust. "While we recognize that economic
conditions are likely to affect both our tenants and our leasing
activity, we also note that it is during these down cycles that
Brandywine has historically outperformed its competitors and
emerged stronger than ever. We are committed to that same level of
performance and tenacity in this current environment and are
confident of our ability to meet and take advantage of the
challenges and opportunities ahead." Distributions Our dividend
policy is to match aggregate 2009 common share dividends to 2009
taxable income and to evaluate the mix of cash and common shares on
an ongoing basis. On June 2, 2009, our Board of Trustees declared a
quarterly dividend distribution of $0.10 per common share that was
paid on July 17, 2009 to shareholders of record as of July 3, 2009.
Our Board also declared regular quarterly dividend distributions of
$0.46875 per 7.50% Series C Cumulative Redeemable Preferred Share
and $0.460938 per 7.375% Series D Cumulative Redeemable Preferred
Share that were paid on July 15, 2009 to holders of record as of
June 30, 2009 of the Series C and Series D Preferred Shares,
respectively. 2009 Earnings and FFO Guidance Based on current plans
and assumptions and subject to the risks and uncertainties more
fully described in our Securities and Exchange Commission filings,
we are increasing our previously issued guidance for full year 2009
FFO per diluted share to be in a range of $1.75 to $1.80 versus the
prior guidance of $1.60 to $1.74 including impairment charges in
both instances. When applicable, we will report our FFO with and
without impairment charges. Our earnings and FFO guidance is
provided for informational purposes and is subject to change. The
following is a reconciliation of the calculation of 2009 earnings
and FFO per diluted share: Guidance for 2009 Range or Value
----------------- -------------- Earnings (loss) per diluted share
allocated to common shareholders $ (0.12) to $ (0.07) Plus: real
estate depreciation and amortization 1.87 1.87 ---- ---- FFO per
diluted share $ 1.75 to $ 1.80 Plus: impairment charges (incurred
to date) 0.03 0.03 ---- ---- Adjusted FFO per diluted share $ 1.78
to $ 1.83 ==== ==== Our 2009 FFO guidance does not include income
arising from future sales or impairments which may be taken in the
future should the circumstances arise. Our 2009 FFO guidance does
not include any income from the sale of undepreciated real estate,
in accordance with our current practice. Our revised 2009 guidance
is based on the expectation that our weighted average fully diluted
shares for 2009 will be approximately 115.0 million. Accounting
Disclosures On January 1, 2009, we adopted FSP APB 14-1, Accounting
for Convertible Debt Instruments That May Be Settled in Cash upon
Conversion (Including Partial Cash Settlement), which requires
retrospective application. This adoption impacts our exchangeable
notes due 2026 with a put date in 2011 that had an outstanding
balance of $264.5 million as of March 31, 2009 and which were
originally issued in October 2006. The retrospective treatment
requires us to bifurcate the net proceeds of the exchangeable notes
on a relative fair value basis (based on the then market "straight
debt" interest rate) between unsecured debt and the equity
conversion options issued in the transaction and affects previously
recognized interest expense, capitalized interest and gain on
extinguishment of debt associated with the convertible notes, and
all related calculations such as net income per diluted share of
the Company. On January 1, 2009, we adopted FAS 160,
Non-controlling Interests in Consolidated Financial Statements an
Amendment to ARB 51, which affects the classification and potential
recognition of any non-controlling interest (formerly called
minority interest) relating to Operating Partnership unit-holders
and outside owners of our three consolidated real estate ventures.
The non-controlling interests related to the Operating Partnership
are reflected as a component of the Equity section of our
Consolidated Balance Sheet, instead of within the "mezzanine"
section. In addition, the non-controlling interests' portion of
earnings is now presented below net income. This presentation is
applied retrospectively. Non-GAAP Supplemental Financial Measures
We compute our financial results in accordance with generally
accepted accounting principles (GAAP). Although FFO, NOI and CAD
are non-GAAP financial measures, we believe that FFO, NOI and CAD
calculations are helpful to shareholders and potential investors
and are widely recognized measures of real estate investment trust
performance. At the end of this press release, we have provided a
reconciliation of the non-GAAP financial measures to the most
directly comparable GAAP measure. Funds from Operations (FFO) We
compute FFO in accordance with standards established by the
National Association of Real Estate Investment Trusts (NAREIT),
which may not be comparable to FFO reported by other REITs that do
not compute FFO in accordance with the NAREIT definition, or that
interpret the NAREIT definition differently than us. NAREIT defines
FFO as net income (loss) before non-controlling interests and
excluding gains (losses) on sales of property and extraordinary
items (computed in accordance with GAAP); plus real estate related
depreciation and amortization (excluding amortization of deferred
financing costs), and after similar adjustments for unconsolidated
joint ventures. Net income, the GAAP measure that we believe to be
most directly comparable to FFO, includes depreciation and
amortization expenses, gains or losses on property sales,
extraordinary items and non-controlling interests. To facilitate a
clear understanding of our historical operating results, FFO should
be examined in conjunction with net income (determined in
accordance with GAAP) as presented in the financial statements
included elsewhere in this release. FFO does not represent cash
flow from operating activities (determined in accordance with GAAP)
and should not be considered to be an alternative to net income
(loss) (determined in accordance with GAAP) as an indication of our
financial performance or to be an alternative to cash flow from
operating activities (determined in accordance with GAAP) as a
measure of our liquidity, nor is it indicative of funds available
for our cash needs, including our ability to make cash
distributions to shareholders. For information purposes, we also
provide FFO adjusted for impairment charges. Although our
calculation of FFO as adjusted differs from NAREIT's definition of
FFO and may not be comparable to that of other REITs and real
estate companies, we believe it provides a meaningful supplemental
measure of our operating performance because we believe that by
excluding impairment charges, shareholders and potential investors
are presented with an indicator of our operating performance that
more closely achieves the objectives of the real estate industry in
presenting FFO. Net Operating Income (NOI) NOI is a non-GAAP
financial measure equal to net income available to common
shareholders, the most directly comparable GAAP financial measure,
plus corporate general and administrative expense, depreciation and
amortization, interest expense, non-controlling interests and
losses from early extinguishment of debt, less interest income,
development and management income, gains from property
dispositions, gains on sale from discontinued operations, gains on
early extinguishment of debt, income from discontinued operations,
income from unconsolidated joint ventures and non-controlling
interests. In some cases, we also present NOI on a cash basis,
which is NOI after eliminating the effect of straight-lining of
rent and deferred market intangible amortization. NOI presented by
us may not be comparable to NOI reported by other REITs that define
NOI differently. NOI should not be considered an alternative to net
income as an indication of our performance, or as an alternative to
cash flow from operating activities as a measure of our liquidity
or ability to make cash distributions to shareholders. Cash
Available for Distribution (CAD) CAD is a non-GAAP financial
measure that is not intended as an alternative to cash flow from
operating activities as determined under GAAP. CAD is presented
solely as a supplemental disclosure with respect to liquidity
because we believe it provides useful information regarding our
ability to fund our distributions. Because other companies do not
necessarily calculate CAD the same way as we do, our presentation
of CAD may not be comparable to similarly titled measures provided
by other companies. Revenue Maintaining Capital Expenditures
Revenue maintaining capital expenditures, a non-GAAP financial
measure, are a component of our CAD calculation and represent the
portion of capital expenditures required to maintain our current
level of funds available for distribution. Revenue maintaining
capital expenditures include current tenant improvement and
allowance expenditures for all tenant spaces that have been owned
for at least one year, and that were not vacant during the
twelve-month period prior to the date that the tenant improvement
or allowance expenditure was approved. Revenue maintaining capital
expenditures also include other expenditures intended to maintain
our current revenue base. Accordingly, we exclude capital
expenditures related to development and redevelopment projects, as
well as certain projects at our core properties that are intended
to attract prospective tenants in order to increase revenues and/or
occupancy rates. Second Quarter Earnings Call and Supplemental
Information Package We will host a conference call on Wednesday,
July 29, 2009 at 10:00 a.m. EDT. The conference call can be
accessed by calling 1-800-683-1525 and referencing conference ID
#12136187. Beginning two hours after the conference call, a taped
replay of the call can be accessed 24 hours a day through
Wednesday, August 12, 2009 by calling 1-800-642-1687 and providing
access code 12136187. In addition, the conference call can be
accessed via a webcast located on our website at
http://www.brandywinerealty.com/. We have prepared a supplemental
information package that includes financial results and operational
statistics related to the second quarter earnings report. The
supplemental information package is available in the "Investor
Relations - Financial Reports" section of our website at
http://www.brandywinerealty.com/. Looking Ahead - Third Quarter
2009 Conference Call We anticipate that we will release our third
quarter 2009 earnings on Wednesday, October 28, 2009, after the
market close and will host our third quarter 2009 conference call
on Thursday, October 29, 2009, at 11:00 a.m. EDT. We expect to
issue a press release in advance of these events to confirm the
dates and times and provide all related information. About
Brandywine Realty Trust Brandywine Realty Trust is one of the
largest, publicly traded, full-service, integrated real estate
companies in the United States. Organized as a real estate
investment trust and operating in select markets, Brandywine owns,
develops and manages a primarily Class A, suburban and urban office
portfolio aggregating approximately 37.3 million square feet,
including 26.1 million square feet which it owns on a consolidated
basis. For more information, visit our website at
http://www.brandywinerealty.com/. Forward-Looking Statements
Estimates of future earnings per share, FFO per share, common share
dividend distributions and certain other statements in this release
constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our and our
affiliates' actual results, performance, achievements or
transactions to be materially different from any future results,
performance, achievements or transactions expressed or implied by
such forward-looking statements. Such risks, uncertainties and
other factors relate to, among others: our ability to lease vacant
space and to renew or relet space under expiring leases at expected
levels; competition with other real estate companies for tenants;
the potential loss or bankruptcy of major tenants; interest rate
levels; the availability of debt, equity or other financing; risks
of acquisitions, dispositions and developments, including the cost
of construction delays and cost overruns; unanticipated operating
and capital costs; our ability to obtain adequate insurance,
including coverage for terrorist acts; dependence upon certain
geographic markets; and general and local economic and real estate
conditions, including the extent and duration of adverse changes
that affect the industries in which our tenants operate. Additional
information on factors which could impact us and the
forward-looking statements contained herein are included in our
filings with the Securities and Exchange Commission, including our
Form 10-K for the year ended December 31, 2008. We assume no
obligation to update or supplement forward-looking statements that
become untrue because of subsequent events except as required by
law. BRANDYWINE REALTY TRUST CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands) June 30, December 31, 2009 2008 ---- ----
ASSETS Real estate investments: Operating properties $4,586,580
$4,608,320 Accumulated depreciation (690,490) (639,688) --------
-------- 3,896,090 3,968,632 Construction-in-progress 197,404
122,219 Land inventory 97,430 100,516 ------ ------- 4,190,924
4,191,367 Cash and cash equivalents 3,936 3,924 Cash in escrow -
31,385 Accounts receivable, net 8,950 11,762 Accrued rent
receivable, net 85,669 86,362 Investment in real estate ventures
75,688 71,028 Deferred costs, net 100,852 89,327 Intangible assets,
net 124,106 145,757 Notes receivable 49,676 48,048 Other assets
47,831 59,008 ------ ------ Total assets $4,687,632 $4,737,968
========== ========== LIABILITIES AND EQUITY Mortgage notes
payable, including premiums $502,961 $487,525 Borrowings under
credit facilities 74,000 153,000 Unsecured term loan 183,000
183,000 Unsecured senior notes, net of discounts 1,724,582
1,917,970 Accounts payable and accrued expenses 85,474 74,824
Distributions payable 15,177 29,288 Tenant security deposits and
deferred rents 54,595 58,692 Acquired lease intangibles, net 42,036
47,626 Other liabilities 53,696 63,545 ------ ------ Total
liabilities 2,735,521 3,015,470 Brandywine Realty Trust's equity:
Preferred shares - Series C 20 20 Preferred shares - Series D 23 23
Common shares 1,284 882 Additional paid-in capital 2,607,628
2,351,428 Deferred compensation payable in common stock 5,858 6,274
Common shares in treasury (7,893) (14,121) Common shares held in
grantor trust (5,858) (6,274) Cumulative earnings 498,280 498,716
Accumulated other comprehensive loss (10,652) (17,005) Cumulative
distributions (1,176,141) (1,150,406) ---------- ---------- Total
Brandywine Realty Trust's equity 1,912,549 1,669,537 ---------
--------- Non-controlling interests 39,562 52,961 ------ ------
Total equity 1,952,111 1,722,498 --------- --------- Total
liabilities and equity $4,687,632 $4,737,968 ========== ==========
BRANDYWINE REALTY TRUST CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except share and per share data) Three
Months Ended Six Months Ended June 30, June 30, ------------------
---------------- 2009 2008 2009 2008 ---- ---- ---- ---- Revenue
Rents $121,598 $123,111 $244,208 $245,879 Tenant reimbursements
18,636 20,786 41,069 39,807 Termination fees 963 892 1,076 4,124
Third party management fees, labor reimbursement and leasing 4,097
5,170 8,861 10,849 Other 583 807 1,501 1,589 --- --- ----- -----
Total revenue 145,877 150,766 296,715 302,248 Operating Expenses
Property operating expenses 40,595 40,171 85,460 80,881 Real estate
taxes 14,517 15,320 29,887 30,801 Third party management expenses
1,968 2,381 4,083 4,627 Depreciation and amortization 53,308 51,492
105,461 102,430 General & administrative expenses 5,515 6,127
10,473 11,039 ----- ----- ------ ------ Total operating expenses
115,903 115,491 235,364 229,778 ------- ------- ------- -------
Operating income 29,975 35,275 61,352 72,470 Other income (expense)
Interest income 642 179 1,222 382 Interest expense (34,944)
(36,742) (70,590) (73,785) Deferred financing costs (1,894) (1,198)
(3,146) (2,706) Recognized hedge activity (305) - (305) - Equity in
income of real estate ventures 1,533 1,664 2,119 2,779 Net (loss)
on disposition of undepreciated real estate - - - (24) Gain on
early extinguishment of debt 12,013 543 18,651 3,106 ------ ---
------ ----- Income (loss) from continuing operations 7,020 (279)
9,303 2,222 Discontinued operations: Income from discontinued
operations (14) 1,922 336 5,037 Net (loss) gain on disposition of
discontinued operations (1,225) 13,420 (1,031) 21,401 Provision for
impairment - (6,850) (3,700) (6,850) ----- ------ ------ ------
Total discontinued operations (1,239) 8,492 (4,395) 19,588 ------
----- ------ ------ Net income (loss) 5,781 8,213 4,908 21,810 Net
(loss) income from discontinued operations attributable to
non-controlling interests - LP units 35 (324) 132 (791) Net income
(loss) attributable to non-controlling interests - partners' share
of consolidated real estate ventures (28) (38) (22) (78) Net income
(loss) attributable to non-controlling interests - LP units (174)
61 (183) 41 ---- -- ---- -- Net (loss) income attributable to non-
controlling interests (168) (301) (73) (828) ---- ---- --- ---- Net
income (loss) attributable to Brandywine Realty Trust 5,607 7,912
4,829 20,982 Preferred share dividends (1,998) (1,998) (3,996)
(3,996) Amount allocated to unvested restricted shareholders (73)
(227) (110) (394) ------ ------ ---- ------- Net income (loss)
available to Common Shareholders $3,543 $5,687 $730 $16,592 ======
====== ==== ======= PER SHARE DATA Basic income per Common Share
$0.03 $0.07 $0.01 $0.19 ===== ===== ===== ===== Basic weighted-
average shares outstanding 101,583,997 87,280,576 94,934,134
87,092,271 Diluted income per Common Share $0.03 $0.06 $0.01 $0.19
===== ===== ===== ===== Diluted weighted- average shares
outstanding 102,742,343 87,512,345 95,495,392 87,300,005 BRANDYWINE
REALTY TRUST FUNDS FROM OPERATIONS AND CASH AVAILABLE FOR
DISTRIBUTION (unaudited, in thousands, except share and per share
data) Three Months Ended Six Months Ended June 30, June 30,
------------------ ----------------- 2009 2008 2009 2008 ---- ----
---- ---- Reconciliation of Net Income (Loss)to Funds from
Operations: Net income (loss) available to common shareholders
$3,543 $5,687 $730 $16,592 Add (deduct): Net income (loss)
attributable to non-controlling interests - LP units 181 (61) 189
(41) Amount allocated to unvested restricted shareholders 73 227
110 394 Net loss on disposition of undepreciated real estate - - -
24 Net (loss) income from discontinued operations attributable to
non-controlling interests - LP units (35) 324 (132) 791 Net loss
(gain) on disposition of discontinued operations 1,225 (13,420)
1,031 (21,401) Depreciation and amortization: Real property -
continuing operations 40,167 37,646 78,807 73,985 Leasing costs
(includes acquired intangibles) -continuing operations 12,676
13,271 25,678 27,257 Real property - discontinued operations 71
3,363 324 6,773 Leasing costs (includes acquired intangibles)
-discontinued operations 71 1,636 291 3,228 Company's share of
unconsolidated real estate ventures 1,852 2,256 3,707 4,323
Partners' share of consolidated real estate ventures (220) (226)
(440) (444) ---- ---- ---- ---- Funds from operations $59,597
$50,703 $110,288 $111,481 Funds from operations allocable to
unvested restricted shareholders (413) (286) (620) $(539) -------
------- -------- -------- Fund from operations available to common
share and unit holders (FFO) $59,184 $50,417 $109,668 $110,942
======= ======= ======== ======== FFO per share - fully diluted
$0.56 $0.55 $1.12 $1.22 ===== ===== ===== ===== FFO, excluding
provision for impairments $59,184 $57,267 $113,368 $117,792 =======
======= ======== ======== FFO per share, excluding provision for
impairments -fully diluted $0.56 $0.63 $1.15 $1.30 ===== =====
===== ===== Weighted-average shares/units outstanding - fully
diluted 105,558,964 90,979,203 98,312,013 90,944,076 Distributions
paid per Common Share $0.10 $0.44 $0.40 $0.88 ===== ===== =====
===== Payout ratio of FFO (Dividends paid per Common Share divided
/FFO per Share) 17.9% 80.0% 35.7% 72.1% Payout ratio of FFO,
excluding provision for impairments 17.9% 69.8% 34.8% 67.7% CASH
AVAILABLE FOR DISTRIBUTION (CAD): Fund from operations available to
common share and unit holders $59,184 $50,417 $109,668 $110,942 Add
(deduct): Rental income from straight- line rent, including
discontinued operations (2,182) (4,624) (4,353) (11,233) Deferred
market rental income, including discontinued operations (1,746)
(2,408) (3,487) (4,686) Company's share of unconsolidated real
estate ventures' straight-line and deferred market rent 119 81 209
155 Partners' share of consolidated real estate ventures'
straight-line and deferred market rent (2) (39) (4) (78) Operating
expense from straight-line rent 370 383 733 766 Net (loss) on
disposition of undepreciated real estate - - - (24) Provision for
impairment of discontinued operations - 6,850 3,700 6,850 Deferred
compensation costs 1,307 1,416 2,528 2,574 Fair market value
amortization - mortgage notes payable (360) (1,105) (788) (2,178)
Recognized hedge activity 305 - 305 - Debt discount amortization -
exchangeable notes 810 1,135 1,766 2,182 Revenue maintaining
capital expenditures Building improvements (944) (1,339) (2,319)
(1,579) Tenant improvements (6,442) (4,526) (11,102) (8,351) Lease
commissions (5,506) (3,453) (8,018) (6,184) ------ ------ ------
------ Total revenue maintaining capital expenditures (12,892)
(9,318) (21,439) (16,114) Cash available for distribution $44,913
$42,788 $88,838 $89,156 ======= ======= ======= ======= CAD per
share - fully diluted $0.43 $0.47 $0.90 $0.98 ===== ===== =====
===== Weighted-average shares/units outstanding - fully diluted
105,558,964 90,979,203 98,312,013 90,944,076 Distributions per
Common Share $0.10 $0.44 $0.40 $0.88 ===== ===== ===== ===== Payout
ratio of CAD (Dividends paid per Common Share /CAD per Share) 23.3%
93.6% 44.4% 89.8% BRANDYWINE REALTY TRUST SAME STORE OPERATIONS -
2nd QUARTER (unaudited and in thousands) Of the 247 properties
owned by the Company as of June 30, 2009, a total of 234 properties
("Same Store Properties") containing an aggregate of 23.1 million
net rentable square feet were owned for the entire three- month
periods ended June 30, 2009 and 2008. Average occupancy for the
Same Store Properties was 90.0% during 2009 and 92.8% during 2008.
The following table sets forth revenue and expense information for
the Same Store Properties: Three Months Ended June 30,
--------------- 2009 2008 ---- ---- Revenue Rents $117,225 $120,088
Tenant reimbursements 17,552 19,771 Termination fees 963 892 Other
419 383 --- --- 136,159 141,134 Operating expenses Property
operating expenses 39,730 40,298 Real estate taxes 13,362 14,449
------ ------ Net operating income $83,067 $86,387 ======= =======
Net operating income - percentage change over prior year -3.8% Net
operating income, excluding termination fees & other $81,685
$85,112 ======= ======= Net operating income, excluding termination
fees & other - percentage change over prior year -4.0% Net
operating income $83,067 $86,387 Straight line rents (1,454)
(4,190) FAS 141R rents (1,679) (1,589) Non-cash ground rent 370 383
--- --- Cash - Net operating income $80,304 $80,991 ======= =======
Cash - Net operating income - percentage change over prior year
-0.8% Cash - Net operating income, excluding termination fees &
other $78,922 $79,716 ======= ======= Cash - Net operating income,
excluding termination fees & other - percentage change over
prior year -1.0% The following table is a reconciliation of Net
Income to Same Store net operating income: Three Months Ended June
30, --------------- 2009 2008 ---- ---- Net income $5,781 $8,213
Add/(deduct): Interest income (642) (179) Interest expense 34,944
36,742 Deferred financing costs 1,894 1,198 Recognized hedge
activity 305 - Equity in income of real estate ventures (1,533)
(1,664) Depreciation and amortization 53,308 51,492 Gain on early
extinguishment of debt (12,013) (543) General & administrative
expenses 5,515 6,127 Income from discontinued operations 1,239
(8,492) ----- ------ Consolidated net operating income 88,798
92,894 Less: Net operating income of non same store properties
(2,322) (2,362) Less: Eliminations and non-property specific net
operating income (3,409) (4,145) ------ ------ Same Store net
operating income $83,067 $86,387 ======= ======= BRANDYWINE REALTY
TRUST SAME STORE OPERATIONS - YEAR (unaudited and in thousands) Of
the 247 properties owned by the Company as of June 30, 2009, a
total of 234 properties ("Same Store Properties") containing an
aggregate of 23.1 million net rentable square feet were owned for
the entire six month periods ended June 30, 2009 and 2008. Average
occupancy for the Same Store Properties was 90.9% during 2009 and
93.1% during 2008. The following table sets forth revenue and
expense information for the Same Store Properties: Six Months Ended
June 30, ---------------- 2009 2008 ---- ---- Revenue Rents
$236,035 $239,976 Tenant reimbursements 38,814 37,635 Termination
fees 1,076 4,124 Other 765 908 --- --- 276,690 282,643 Operating
expenses Property operating expenses 81,343 79,368 Real estate
taxes 27,598 28,991 ------ ------ Net operating income $167,749
$174,284 ======== ======== Net operating income - percentage change
over prior year -3.7% Net operating income, excluding termination
fees & other $165,908 $169,252 ======== ======== Net operating
income, excluding termination fees & other - percentage change
over prior year -2.0% Net operating income $167,749 $174,284
Straight line rents (3,067) (10,142) FAS 141 rents (3,346) (3,010)
Non-cash ground rent 733 766 --- --- Cash - Net operating income
$162,069 $161,898 ======== ======== Cash - Net operating income -
percentage change over prior year 0.1% Cash - Net operating income,
excluding termination fees & other $160,228 $156,866 ========
======== Cash - Net operating income, excluding termination fees
& other - percentage change over prior year 2.1% The following
table is a reconciliation of Net Income to Same Store net operating
income: Six Months Ended June 30, ---------------- 2009 2008 ----
---- Net Income $4,908 $21,810 Add/(deduct): Interest income
(1,222) (382) Interest expense 70,590 73,785 Deferred financing
costs 3,146 2,706 Recognized hedge activity 305 - Equity in income
of real estate ventures (2,119) (2,779) Depreciation and
amortization 105,461 102,430 Net loss on sale of undepreciated real
estate - 24 Gain on early extinguishment of debt (18,651) (3,106)
General & administrative expenses 10,473 11,039 Income from
discontinued operations 4,395 (19,588) ----- ------- Consolidated
net operating income 177,286 185,939 Less: Net operating income of
non same store properties (4,045) (4,530) Less: Eliminations and
non-property specific net operating income (loss) (5,492) (7,125)
------ ------ Same Store net operating income $167,749 $174,284
======== ======== DATASOURCE: Brandywine Realty Trust CONTACT:
Investor/Press Contact: Marge Boccuti, Manager, Investor Relations,
+1-610-832-7702, ; or Company Contact: Howard M. Sipzner, EVP &
CFO, +1-610-832-4907, Web Site: http://www.brandywinerealty.com/
Copyright