Creative Media & Community Trust Corporation (NASDAQ and
TASE: CMCT) (“we”, “our”, “CMCT”, or the “Company”), today reported
operating results for the three months ended March 31, 2023.
First Quarter 2023 Highlights
Real Estate Portfolio
- Same-store office portfolio(2) was 83.6% leased.
- Executed 43,887 square feet of leases with terms longer than 12
months.
- Purchased two multifamily properties with a combined 621 units
and two land parcels in Oakland for a combined purchase price of
$282.9 million.
- Invested $6.6 million of equity in a newly formed joint venture
that acquired a 75 unit multifamily building in Echo Park, Los
Angeles.
- Sold an 80% interest in an office building in Los Angeles to
co-investors for $34.4 million, retaining a 20% interest in the
property through a newly formed joint venture which is converting
two of the building’s three floors into luxury for-lease
multifamily units.
Financial Results
- Redeemed all remaining shares of our Series L Preferred Stock
in cash for a total cost of $83.8 million.
- Net loss attributable to common stockholders of $12.7 million,
or $0.56 per diluted share.
- Funds from operations (“FFO”) attributable to common
stockholders(3) was $(4.8) million, or $(0.21) per diluted
share.
- Core FFO attributable to common stockholders(4) was $(1.3)
million, or $(0.06) per diluted share.
Management Commentary
“We made significant strides in the first quarter growing our
newer vintage, highly amenitized multifamily portfolio in high
barrier-to-entry markets by acquiring interests in three properties
totaling 696 units in the Bay Area and Los Angeles,” said David
Thompson, Chief Executive Officer of Creative Media & Community
Trust Corporation.
“We also advanced our asset-light growth strategy by partnering
with three international institutional investors and starting the
conversion of the unleased portion of one of our Los Angeles office
buildings into luxury multifamily.
“Finally, we created additional liquidity by raising net
proceeds of $23.6 million from the sale of our Series A1 preferred
stock and completing a securitization of our lending portfolio
generating $43.3 million of net proceeds.”
First Quarter 2023 Results
Real Estate Portfolio
As of March 31, 2023, our real estate portfolio consisted of 25
assets, all of which were fee-simple properties, including two
office properties (one of which is being partially converted into
multifamily units) and one multifamily property which the Company
has an ownership interest in through investments in unconsolidated
joint ventures. The portfolio included 13 office properties
totaling approximately 1.3 million of rentable square feet, three
multifamily properties with a total of 696 units, seven development
sites (two being used as parking lots), and one 503-room hotel with
an ancillary parking garage.
Financial Results
Net loss attributable to common stockholders was $12.7 million,
or $0.56 per diluted share of common stock, for the three months
ended March 31, 2023, compared to a net loss attributable to common
stockholders of $2.8 million, or $0.12 per diluted share of common
stock, for the same period in 2022. The increase in net loss
attributable to common stockholders was driven by the $7.0 million
decrease in FFO discussed below as well as an increase in
depreciation and amortization expense of $4.5 million, partially
offset by a gain of $1.1 million recognized in connection with the
sale of 80% of our interest in an office property during the three
months ended March 31, 2023.
FFO attributable to common stockholders(3) was $(4.8) million,
or $(0.21) per diluted share of common stock, for the three months
ended March 31, 2023, a decrease of $7.0 million compared to $2.2
million, or $0.09 per diluted share of common stock, for the same
period in 2022. The decrease in FFO was primarily attributable to
an increase in non-lending segment interest expense of $3.9
million, an increase in transaction-related costs of $3.4 million
(primarily related to transfer tax expenses in connection with the
acquisition of two multifamily properties in Oakland, California
during the three months ended March 31, 2023) and an increase in
redeemable preferred stock dividends and redeemable preferred stock
redemptions of $373,000 and $298,000, respectively. These were
partially offset by an increase of $822,000 in segment net
operating income (discussed in more detail below).
Core FFO attributable to common stockholders(4) was $(1.3)
million, or $(0.06) per diluted share of common stock, for the
three months ended March 31, 2023, compared to $2.3 million, or
$0.10 per diluted share of common stock, for the same period in
2022. The decrease in Core FFO is attributable to the
aforementioned changes in FFO, while not impacted by the increases
in transaction-related costs (net of the noncontrolling interests’
proportionate share of such costs) and redeemable preferred stock
redemptions as these are excluded from our Core FFO
calculation.
Segment Information
Our reportable segments during the three months ended March 31,
2023 and 2022 consisted of three types of commercial real estate
properties, namely, office, hotel and multifamily, as well as a
segment for our lending business. Total segment net operating
income (“NOI”)(5) was $13.0 million for the three months ended
March 31, 2023, compared to $12.2 million for the same period in
2022.
Office
Same-Store
Same-store(2) office segment NOI(5) decreased to $6.9 million
for the three months ended March 31, 2023, compared to $7.7 million
in the same period in 2022, while same-store(1) office Cash NOI(6)
excluding lease termination income decreased to $7.5 million for
the three months ended March 31, 2023, compared to $7.7 million in
the same period in 2022. The decrease in same-store(1) office Cash
NOI(6) excluding lease termination income was primarily due to a
decrease in rental revenue at an office property in Los Angeles,
California and an office property in San Francisco, California,
both as a result of decreased occupancy. The decrease in
same-store(2) office segment NOI(5) was driven by the decrease in
rental revenue at the two aforementioned properties, as well as a
decrease in segment NOI related to an office property in Beverly
Hills, California, where increases in cash rental rates at existing
leases were negated by the impact of deferred rent adjustments and
an increase non-reimbursable operating expenses.
At March 31, 2023, the Company’s same-store(2) office portfolio
was 80.9% occupied, a decrease of 370 basis points year-over-year
on a same-store(2) basis, and 83.6% leased, a decrease of 330 basis
points year-over-year on a same-store(2) basis. The annualized rent
per occupied square foot(7) on a same-store(2) basis was $56.88 at
March 31, 2023 compared to $55.20 at March 31, 2022. During the
three months ended March 31, 2023, the Company executed 28,445
square feet of leases with terms longer than 12 months at our
same-store(2) office portfolio.
Total
Office Segment NOI(5) decreased to $6.8 million for the three
months ended March 31, 2023, from $8.0 million for the same period
in 2022. The decrease is primarily due to the decrease in
same-store(2) office segment NOI(5) discussed above as well as a
decrease in non-same-store(2) office Segment NOI(5) of $446,000
which was driven by a decrease in income from an unconsolidated
office entity acquired in February 2022 due to an increase in
mortgage interest expense and an unrealized loss related to the
entity’s investment in real estate during the three months ended
March 31, 2023.
Hotel
Hotel Segment NOI(5) increased to $4.1 million for the three
months ended March 31, 2023, from $2.4 million for the same period
in 2022, due to an increase in occupancy and average daily rate as
a result of the hospitality industry continuing to recover from the
impact of COVID-19.
Three Months Ended March
31,
2023
2022
Occupancy
80.6
%
69.2
%
Average daily rate(a)
$
202.02
$
173.14
Revenue per available room(b)
$
162.85
$
119.78
____________________
(a) Calculated as trailing 3-month room
revenue divided by the number of rooms occupied.
(b) Calculated as trailing 3-month room
revenue divided by the number of available rooms.
Multifamily
Our Multifamily Segment consists of two multifamily buildings
located in Oakland, California as well as an investment in a
multifamily building in the Echo Park neighborhood of Los Angeles,
California through a 50% joint-venture partnership, all of which
were acquired during the three months ended March 31, 2023. Our
Multifamily Segment NOI(5) was $675,000 for the three months ended
March 31, 2023. As of March 31, 2023, our Multifamily Segment was
80.7% occupied and the monthly rent per occupied unit(8) was
$2,852.
Lending
Our lending segment primarily consists of our SBA 7(a) lending
platform, which is a national lender that primarily originates
loans to small businesses in the hospitality industry. Lending
Segment NOI(5) was $1.4 million for the three months ended March
31, 2023, compared to $1.7 million for the same period in 2022. The
decrease is due to an increase in allocated salary expenses and an
increase in interest expense related to the issuance of new SBA
7(a) loan-backed notes in connection with the securitization that
closed in March 2023, as well as lower revenues related to lower
premium income as a result of lower loan sale volume during the
three months ended March 31, 2023, compared to the three months
ended March 31, 2022.
Debt and Equity
On March 9, 2023, we completed a securitization of the
unguaranteed portion of certain of our SBA 7(a) loans receivable
with the issuance of $54.1 million of unguaranteed SBA 7(a)
loan-backed notes (with net proceeds of approximately $43.3
million, after payment of fees and expenses in connection with the
securitization and the funding of a reserve account and an escrow
account).
During the three months ended March 31, 2023, we issued
1,032,433 shares of Series A1 Preferred Stock for aggregate net
proceeds of $23.6 million. Net proceeds represent gross proceeds
offset by costs specifically identifiable to the offering, such as
commissions, dealer manager fees and other offering fees and
expenses. Additionally, during the three months ended March 31,
2023, we had net incremental borrowings of $122.0 million on our
revolving credit facility.
As previously announced on December 23, 2022, we redeemed all
remaining outstanding shares of our Series L Preferred Stock in
cash on January 25, 2023 at its stated value of $28.37 per share.
The total cost to complete the Series L Redemption, including
transaction costs, was $83.8 million. Additionally, on January 25,
2023 we paid the accrued and unpaid dividends on the redeemed
shares of Series L Preferred Stock through December 31, 2022 of
$1.56 per share (or $4.6 million accrued and unpaid dividends in
the aggregate).
Dividends
On March 20, 2023, we declared a quarterly cash dividend of
$0.0850 per share of our common stock, which was paid on April 11,
2023.
On April 4, 2023, we declared a quarterly cash dividend of
$0.34375 per share of our Series A Preferred Stock for the second
quarter of 2023. The dividend will be payable as follows: $0.114583
per share to be paid on May 15, 2023 to Series A Preferred
Stockholders of record on May 5, 2023; $0.114583 per share to be
paid on June 15, 2023 to Series A Preferred Stockholders of record
on June 5, 2023; and $0.114583 per share to be paid on July 17,
2023 to Series A Preferred Stockholders of record on July 5,
2023.
On April 4, 2023, we declared a quarterly cash dividend of
$0.442500 per share of our Series A1 Preferred Stock for the second
quarter of 2023. The dividend will be payable as follows: $0.147500
per share to be paid on May 15, 2023 to Series A1 Preferred
Stockholders of record on May 5, 2023; $0.147500 per share to be
paid on June 15, 2023 to Series A1 Preferred Stockholders of record
on June 5, 2023; and $0.147500 per share to be paid on July 17,
2023 to Series A1 Preferred Stockholders of record on July 5, 2023.
For shares of Series A1 Preferred stock issued during the second
quarter of 2023, the dividend will be prorated from the date of
issuance, and the monthly dividend payments will reflect such
proration, as applicable.
On April 4, 2023, we declared a quarterly cash dividend of
$0.353125 per share of our Series D Preferred Stock for the second
quarter of 2023. The dividend will be payable as follows: $0.117708
per share to be paid on May 15, 2023 to Series D Preferred
Stockholders of record on May 5, 2023; $0.117708 per share to be
paid on June 15, 2023 to Series D Preferred Stockholders of record
on June 5, 2023; and $0.117708 per share to be paid on July 17,
2023 to Series D Preferred Stockholders of record on July 5,
2023.
Acquisitions
The following table details our acquisition activity during the
three months ended March 31, 2023:
Property
Asset Type
Date of Acquisition
Units
Interest Acquired
Purchase Price
(in thousands)
Channel House
Multifamily
January 31, 2023
333
89.4
%
$
134,615
F3 Land Site
Multifamily
January 31, 2023
N/A
89.4
%
$
250
466 Water Street Land Site (1)
Multifamily
January 31, 2023
N/A
89.4
%
$
2,500
1150 Clay
Multifamily
March 28, 2023
288
98.1
%
$
145,500
4750 Wilshire Boulevard (2)(3)
Office / Multifamily
February 17, 2023
N/A
20.0
%
$
8,600
1902 Park Avenue (2)
Multifamily
February 28, 2023
75
50.0
%
$
6,626
____________________
(1)
Currently utilized as a surface parking lot
(2)
Represents an unconsolidated joint venture investment.
(3)
We sold 80% of our interest in 4750 Wilshire Boulevard (excluding a
vacant land parcel which was not included in the sale) to
third-party co-investors with whom we formed a joint venture. The
remaining 20% interest represents our interest in the newly formed
unconsolidated joint venture.
About the Data
Descriptions of certain performance measures, including Segment
NOI, Cash NOI, FFO attributable to common stockholders, and Core
FFO are provided below. Refer to the subsequent tables for
reconciliation of these non-GAAP financial measures to the most
directly comparable GAAP financial measure.
(1)
Stabilized office portfolio: represents office
properties where occupancy was not impacted by a redevelopment or
repositioning during the period.
(2)
Same-store properties: are properties that we
have owned and operated in a consistent manner and reported in our
consolidated results during the entire span of the periods being
reported. We excluded from our same-store property set this quarter
any properties (i) acquired on or after January 1, 2022; (ii) sold
or otherwise removed from our consolidated financial statements on
or before March 31, 2023; or (iii) that underwent a major
repositioning project we believed significantly affected its
results at any point during the period commencing on January 1,
2022 and ending on March 31, 2023. When determining our same-store
properties as of March 31, 2023, one property was excluded pursuant
to (i) and (iii) above and no properties were excluded pursuant to
(ii) above.
(3)
FFO
attributable to common stockholders: represents net
income (loss) attributable to common stockholders, computed in
accordance with GAAP, which reflects the deduction of redeemable
preferred stock dividends accumulated, excluding gain (or loss)
from sales of real estate, impairment of real estate, and real
estate depreciation and amortization. We calculate FFO in
accordance with the standards established by the National
Association of Real Estate Investment Trusts (the “NAREIT”). See
‘Core FFO’ definition below for discussion of the benefits and
limitations of FFO as a supplemental measure of operating
performance.
(4)
Core FFO
attributable to common stockholders (“Core FFO”):
represents FFO attributable to common stockholders (computed as
described above), excluding gain (loss) on early extinguishment of
debt, redeemable preferred stock deemed dividends, redeemable
preferred stock redemptions, gain (loss) on termination of interest
rate swaps, and transaction costs.
We believe that FFO is a widely
recognized and appropriate measure of the performance of a REIT and
that it is frequently used by securities analysts, investors and
other interested parties in the evaluation of REITs, many of which
present FFO when reporting their results. In addition, we believe
that Core FFO is a useful metric for securities analysts, investors
and other interested parties in the evaluation of our Company as it
excludes from FFO the effect of certain amounts that we believe are
non-recurring, are non-operating in nature as they relate to the
manner in which we finance our operations, or transactions outside
of the ordinary course of business.
Like any metric, FFO and Core FFO
should not be used as the only measure of our performance because
it excludes depreciation and amortization and captures neither the
changes in the value of our real estate properties that result from
use or market conditions nor the level of capital expenditures and
leasing commissions necessary to maintain the operating performance
of our properties, and Core FFO excludes amounts incurred in
connection with non-recurring special projects, prepaying or
defeasing our debt, repurchasing our preferred stock, and adjusting
the carrying value of our preferred stock classified in temporary
equity to its redemption value, all of which have real economic
effect and could materially impact our operating results. Other
REITs may not calculate FFO and Core FFO in the same manner as we
do, or at all; accordingly, our FFO and Core FFO may not be
comparable to the FFOs and Core FFOs of other REITs. Therefore, FFO
and Core FFO should be considered only as a supplement to net
income (loss) as a measure of our performance and should not be
used as a supplement to or substitute measure for cash flows from
operating activities computed in accordance with GAAP. FFO and Core
FFO should not be used as a measure of our liquidity, nor is it
indicative of funds available to fund our cash needs, including our
ability to pay dividends. FFO and Core FFO per share for the
year-to-date period may differ from the sum of quarterly FFO and
Core FFO per share amounts due to the required method for computing
per share amounts for the respective periods. In addition, FFO and
Core FFO per share is calculated independently for each component
and may not be additive due to rounding.
(5)
Segment
NOI: for our real estate segments represents rental and
other property income and expense reimbursements less property
related expenses and excludes non-property income and expenses,
interest expense, depreciation and amortization, corporate related
general and administrative expenses, gain (loss) on sale of real
estate, gain (loss) on early extinguishment of debt, impairment of
real estate, transaction costs, and benefit (provision) for income
taxes. For our lending segment, Segment NOI represents interest
income net of interest expense and general overhead expenses. See
‘Cash NOI’ definition below for discussion of the benefits and
limitations of Segment NOI as a supplemental measure of operating
performance.
(6)
Cash
NOI: for our real estate segments, represents Segment
NOI adjusted to exclude the effect of the straight lining of rents,
acquired above/below market lease amortization and other
adjustments required by generally accepted accounting principles
(“GAAP”). For our lending segment, there is no distinction between
Cash NOI and Segment NOI. We also evaluate the operating
performance and financial results of our operating segments using
cash basis NOI excluding lease termination income, or “Cash NOI
excluding lease termination income”.
Segment NOI and Cash NOI are not
measures of operating results or cash flows from operating
activities as measured by GAAP and should not be considered
alternatives to income from continuing operations, or to cash flows
as a measure of liquidity, or as an indication of our performance
or of our ability to pay dividends. Companies may not calculate
Segment NOI or Cash NOI in the same manner. We consider Segment NOI
and Cash NOI to be useful performance measures to investors and
management because, when compared across periods, they reflect the
revenues and expenses directly associated with owning and operating
our properties and the impact to operations from trends in
occupancy rates, rental rates and operating costs, providing a
perspective not immediately apparent from income from continuing
operations. Additionally, we believe that Cash NOI is helpful to
investors because it eliminates straight line rent and other
non-cash adjustments to revenue and expenses.
(7)
Annualized rent per occupied square foot:
represents gross monthly base rent under leases commenced as of the
specified periods, multiplied by twelve. This amount reflects total
cash rent before abatements. Where applicable, annualized rent has
been grossed up by adding annualized expense reimbursements to base
rent. Annualized rent for certain office properties includes rent
attributable to retail.
(8)
Monthly
rent per occupied unit: Represents gross monthly base
rent under leases commenced as of the specified period, divided by
occupied units. This amount reflects total cash rent before
concessions.
FORWARD-LOOKING STATEMENTS
This press release contains certain “forward-looking statements”
within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 (the “Exchange
Act”), which are intended to be covered by the safe harbors created
thereby. These statements include the plans and objectives of
management for future operations, including plans and objectives
relating to future growth of CMCT’s business and availability of
funds. Such forward-looking statements can be identified by the use
of forward-looking terminology such as “may,” “will,” “project,”
“target,” “expect,” “intend,” “might,” “believe,” “anticipate,”
“estimate,” “could,” “would,” “continue,” “pursue,” “potential,”
“forecast,” “seek,” “plan,” or “should,” or “goal” or the negative
thereof or other variations or similar words or phrases. Such
forward-looking statements also include, among others, statements
about CMCT’s plans and objectives relating to future growth and
outlook. Such forward-looking statements are based on particular
assumptions that management of CMCT has made in light of its
experience, as well as its perception of expected future
developments and other factors that it believes are appropriate
under the circumstances. Forward-looking statements are necessarily
estimates reflecting the judgment of CMCT’s management and involve
a number of risks and uncertainties that could cause actual results
to differ materially from those suggested by the forward-looking
statements. These risks and uncertainties include those associated
with (i) the timing, form, and operational effects of CMCT’s
development activities, (ii) the ability of CMCT to raise in place
rents to existing market rents and to maintain or increase
occupancy levels, (iii) fluctuations in market rents, (iv) the
effects of inflation and higher interest rates on the operations
and profitability of CMCT and (vii) general economic, market and
other conditions. Additional important factors that could cause
CMCT’s actual results to differ materially from CMCT’s expectations
are discussed under the section “Risk Factors” in CMCT’s Annual
Report on Form 10-K for the year ended December 31, 2022 and in
CMCT’s Quarterly Report on Form 10-Q for the period ended March 31,
2023. The forward-looking statements included herein are based on
current expectations and there can be no assurance that these
expectations will be attained. Assumptions relating to the
foregoing involve judgments with respect to, among other things,
future economic, competitive and market conditions and future
business decisions, all of which are difficult or impossible to
predict accurately and many of which are beyond CMCT’s control.
Although we believe that the assumptions underlying the
forward-looking statements are reasonable, any of the assumptions
could be inaccurate and, therefore, there can be no assurance that
the forward-looking statements included herein will prove to be
accurate. In light of the significant uncertainties inherent in the
forward-looking statements expressed or implied herein, the
inclusion of such information should not be regarded as a
representation by CMCT or any other person that CMCT’s objectives
and plans will be achieved. Readers are cautioned not to place
undue reliance on forward-looking statements. Forward-looking
statements speak only as of the date they are made. CMCT does not
undertake to update them to reflect changes that occur after the
date they are made, except as may be required by applicable
securities law.
CREATIVE MEDIA & COMMUNITY
TRUST CORPORATION AND SUBSIDIARIES
Consolidated Balance
Sheets
(Unaudited and in thousands,
except share and per share amounts)
March 31, 2023
December 31, 2022
ASSETS
Investments in real estate, net
$
715,850
$
502,006
Investments in unconsolidated entities
28,375
12,381
Cash and cash equivalents
22,491
46,190
Restricted cash
24,342
11,290
Loans receivable, net
62,442
62,547
Accounts receivable, net
7,982
3,780
Deferred rent receivable and charges,
net
33,894
37,543
Other intangible assets, net
27,591
4,461
Other assets
34,589
10,050
TOTAL ASSETS
$
957,556
$
690,248
LIABILITIES, REDEEMABLE PREFERRED
STOCK, AND EQUITY
LIABILITIES:
Debt, net
$
520,748
$
184,267
Accounts payable and accrued expenses
31,445
107,220
Intangible liabilities, net
234
20
Due to related parties
3,877
3,155
Other liabilities
15,737
17,856
Total liabilities
572,041
312,518
COMMITMENTS AND CONTINGENCIES (Note
15)
REDEEMABLE PREFERRED STOCK: Series A
cumulative redeemable preferred stock, $0.001 par value; 35,246,719
shares authorized; 302,136 and 302,136 shares issued and
outstanding, respectively, as of March 31, 2023 and 693,741 and
693,741 shares issued and outstanding, respectively, as of December
31, 2022; liquidation preference of $25.00 per share, subject to
adjustment
6,833
15,697
EQUITY:
Series A cumulative redeemable preferred
stock, $0.001 par value; 35,246,719 shares authorized; 8,518,202
and 7,764,921 shares issued and outstanding, respectively, as of
March 31, 2023 and 8,126,597 and 7,565,349 shares issued and
outstanding, respectively, as of December 31, 2022; liquidation
preference of $25.00 per share, subject to adjustment
194,024
189,048
Series A1 cumulative redeemable preferred
stock, $0.001 par value; 27,977,200 shares authorized; 6,998,510
and 6,975,710 shares issued and outstanding, respectively, as of
March 31, 2023 and 5,966,077 and 5,956,147 shares issued and
outstanding, respectively, as of December 31, 2022; liquidation
preference of $25.00 per share, subject to adjustment
172,764
147,514
Series D cumulative redeemable preferred
stock, $0.001 par value; 26,992,000 shares authorized; 56,857 and
48,857 shares issued and outstanding, respectively, as of March 31,
2023 and 56,857 and 48,857 shares issued and outstanding,
respectively, as of December 31, 2022; liquidation preference of
$25.00 per share, subject to adjustment
1,200
1,200
Common stock, $0.001 par value;
900,000,000 shares authorized; 22,737,853 shares issued and
outstanding as of March 31, 2023 and 22,737,853 shares issued and
outstanding as of December 31, 2022.
23
23
Additional paid-in capital
859,029
861,721
Distributions in excess of earnings
(853,108
)
(837,846
)
Total stockholders’ equity
373,932
361,660
Noncontrolling interests
4,750
373
Total equity
378,682
362,033
TOTAL LIABILITIES, REDEEMABLE PREFERRED
STOCK, AND EQUITY
$
957,556
$
690,248
CREATIVE MEDIA & COMMUNITY
TRUST CORPORATION AND SUBSIDIARIES
Consolidated Statements of
Operations
(Unaudited and in thousands,
except per share amounts)
Three Months Ended March
31,
2023
2022
REVENUES:
Rental and other property income
$
14,886
$
14,096
Hotel income
10,923
7,404
Interest and other income
3,103
3,282
Total Revenues
28,912
24,782
EXPENSES:
Rental and other property operating
15,225
11,492
Asset management and other fees to related
parties
720
921
Expense reimbursements to related
parties—corporate
528
422
Expense reimbursements to related
parties—lending segment
608
469
Interest
6,236
2,170
General and administrative
1,925
1,815
Transaction-related costs
3,360
—
Depreciation and amortization
9,502
5,004
Total Expenses
38,104
22,293
Income from unconsolidated entities
768
120
Gain on sale of real estate
1,104
—
(LOSS) INCOME BEFORE PROVISION FOR INCOME
TAXES
(7,320
)
2,609
Provision for income taxes
256
307
NET (LOSS) INCOME
(7,576
)
2,302
Net loss (income) attributable to
noncontrolling interests
625
(5
)
NET (LOSS) INCOME ATTRIBUTABLE TO THE
COMPANY
(6,951
)
2,297
Redeemable preferred stock dividends
declared or accumulated
(5,391
)
(5,018
)
Redeemable preferred stock deemed
dividends
—
(15
)
Redeemable preferred stock redemptions
(373
)
(75
)
NET LOSS ATTRIBUTABLE TO COMMON
STOCKHOLDERS
$
(12,715
)
$
(2,811
)
NET LOSS ATTRIBUTABLE TO COMMON
STOCKHOLDERS PER SHARE:
Basic
$
(0.56
)
$
(0.12
)
Diluted
$
(0.56
)
$
(0.12
)
WEIGHTED AVERAGE SHARES OF COMMON STOCK
OUTSTANDING:
Basic
22,707
23,349
Diluted
22,707
23,351
CREATIVE MEDIA & COMMUNITY
TRUST CORPORATION AND SUBSIDIARIES
Funds from Operations
(Unaudited and in thousands,
except per share amounts)
Three Months Ended March
31,
2023
2022
Numerator:
Net loss attributable to common
stockholders
$
(12,715
)
$
(2,811
)
Depreciation and amortization
9,502
5,004
Noncontrolling interests’ proportionate
share of depreciation and amortization
(477
)
Gain on sale of real estate
(1,104
)
—
FFO attributable to common
stockholders
$
(4,794
)
$
2,193
Redeemable preferred stock dividends
declared on dilutive shares (a)
—
(1
)
Diluted FFO attributable to common
stockholders
$
(4,794
)
$
2,192
Denominator:
Basic weighted average shares of common
stock outstanding
22,707
23,349
Effect of dilutive securities—contingently
issuable shares (a)
—
24
Diluted weighted average shares and common
stock equivalents outstanding
22,707
23,373
FFO attributable to common stockholders
per share:
Basic
$
(0.21
)
$
0.09
Diluted
$
(0.21
)
$
0.09
____________________
(a)
For the three months ended March 31, 2023 and 2022, the effect
of certain shares of redeemable preferred stock were excluded from
the computation of diluted FFO attributable to common stockholders
and the diluted weighted average shares and common stock
equivalents outstanding as such inclusion would be
anti-dilutive.
CREATIVE MEDIA & COMMUNITY
TRUST CORPORATION AND SUBSIDIARIES
Core Funds from
Operations
(Unaudited and in thousands,
except per share amounts)
Three Months Ended March
31,
2023
2022
Numerator:
Net loss attributable to common
stockholders
$
(12,715
)
$
(2,811
)
Depreciation and amortization
9,502
5,004
Noncontrolling interests’ proportionate
share of depreciation and amortization
(477
)
—
Gain on sale of real estate
(1,104
)
—
FFO attributable to common
stockholders
$
(4,794
)
$
2,193
Redeemable preferred stock redemptions
373
75
Redeemable preferred stock deemed
dividends
—
15
Transaction-related costs
3,360
—
Noncontrolling interests’ proportionate
share of transaction-related costs
(194
)
Core FFO attributable to common
stockholders
$
(1,255
)
$
2,283
Redeemable preferred stock dividends
declared on dilutive shares (a)
—
(1
)
Diluted Core FFO attributable to common
stockholders
$
(1,255
)
$
2,282
Denominator:
Basic weighted average shares of common
stock outstanding
22,707
23,349
Effect of dilutive securities-contingently
issuable shares (a)
—
24
Diluted weighted average shares and common
stock equivalents outstanding
22,707
23,373
Core FFO attributable to common
stockholders per share:
Basic
$
(0.06
)
$
0.10
Diluted
$
(0.06
)
$
0.10
____________________
(a)
For the three months ended March 31, 2023 and 2022, the effect
of certain shares of redeemable preferred stock were excluded from
the computation of diluted Core FFO attributable to common
stockholders and the diluted weighted average shares and common
stock equivalents outstanding as such inclusion would be
anti-dilutive.
CREATIVE MEDIA & COMMUNITY
TRUST CORPORATION AND SUBSIDIARIES
Reconciliation of Net
Operating Income
(Unaudited and in
thousands)
Three Months Ended March 31,
2023
Same-Store
Office
Non-Same-Store Office
Total Office
Hotel
Multi-family
Lending
Total
Cash net operating income excluding lease
termination income
$
7,495
$
(83
)
$
7,412
$
4,146
$
908
$
1,358
$
13,824
Cash lease termination income
—
—
—
—
—
—
—
Cash net operating income (loss)
7,495
(83
)
7,412
4,146
908
1,358
13,824
Deferred rent and amortization of
intangible assets, liabilities, and lease inducements
(603
)
(9
)
(612
)
(1
)
(233
)
—
(846
)
Segment net operating income (loss)
$
6,892
$
(92
)
$
6,800
$
4,145
$
675
$
1,358
$
12,978
Asset management and other fees to related
parties
(720
)
Expense reimbursements to related
parties—corporate
(528
)
Interest expense
(5,991
)
General and administrative
(1,301
)
Transaction-related costs
(3,360
)
Depreciation and amortization
(9,502
)
Gain on sale of real estate
1,104
Loss before provision for income taxes
(7,320
)
Provision for income taxes
(256
)
Net loss
(7,576
)
Net loss attributable to noncontrolling
interests
625
Net loss attributable to the Company
$
(6,951
)
Three Months Ended March 31,
2022
Same-Store
Office
Non-Same-Store Office
Total Office
Hotel
Multi-family
Lending
Total
Cash net operating income excluding lease
termination income
$
7,743
$
345
$
8,088
$
2,397
$
—
$
1,748
$
12,233
Cash lease termination income
121
—
121
—
—
—
121
Cash net operating income
7,864
345
8,209
2,397
—
1,748
12,354
Deferred rent and amortization of
intangible assets, liabilities, and lease inducements
(204
)
9
(195
)
(3
)
—
—
(198
)
Straight line lease termination income
—
—
—
—
—
—
—
Segment net operating income (loss)
$
7,660
$
354
$
8,014
$
2,394
$
—
$
1,748
$
12,156
Asset management and other fees to related
parties
(921
)
Expense reimbursements to related
parties—corporate
(422
)
Interest expense
(2,063
)
General and administrative
(1,137
)
Depreciation and amortization
(5,004
)
Income before provision for income
taxes
2,609
Provision for income taxes
(307
)
Net income
2,302
Net income attributable to noncontrolling
interests
(5
)
Net income attributable to the Company
$
2,297
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230502005517/en/
For Creative Media & Community Trust Corporation Media
Relations: Bill Mendel, 212-397-1030 bill@mendelcommunications.com
or Shareholder Relations: Steve Altebrando, 646-652-8473
shareholders@cimcommercial.com
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