Alexander Haagen Properties Reports: First Quarter Results; $49 Million in Acquisitions; Change of Name to CenterTrust Retail Properties Inc.MANHATTAN BEACH Manhattan Beach, city (1990 pop. 32,063), Los Angeles co., S Calif., on Santa Monica Bay; inc. 1912. It is a residential and beach community with an oil refinery and nearby factories that produce transportation and electrical equipment, computers, and pottery. , Calif.--(BUSINESS WIRE)--May 13, 1998-- -- FFO FFO See: Funds from operations of $.35 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share for the quarter -- New management team in place -- $49 million in acquisitions to date during second quarter -- Repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. of company continues with name change Alexander Haagen Properties Inc. (AMEX AMEX See: American Stock Exchange :ACH (Automated Clearing House) A system of the U.S. Federal Reserve Bank that provides electronic funds transfer (EFT) between banks. It is used for all kinds of fund transfer transactions, including direct deposit of paychecks and monthly debits for routine payments to ), a real estate investment trust, Wednesday Wednesday: see week. announced first quarter results (ended March 31, 1998). "Our achievements since the beginning of the year continue the strategic repositioning of the company," said Edward Edward killed his father at his mother’s instigation. [Br. Balladry: Edward in Benét, 302] See : Patricide D. (Ned) Fox Jr., president and chief executive officer. "They are designed to accelerate the achievement of our strategic goal of becoming the dominant owner (Law) one who owns lands on which there is an easement owned by another. - Bouvier. See also: Dominant in community retail centers in the West while providing long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. shareholder value and earnings growth." FIRST QUARTER RESULTS Funds from Operations Funds From Operations (FFO) Used by real estate and other investment trusts to define the cash flow from trust operations; earnings with depreciation and amortization added back. (FFO), a widely accepted measure of REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). performance, on a diluted basis (assuming conversion of the company's convertible debentures Convertible Debenture Any type of debenture that can be converted into some other security. Notes: For example, a convertible bond can be converted into stock. and other common stock equivalents), was $11.0 million for the quarter, or $0.35 per share, compared with $9.0 million, or $0.35 per share, from the same quarter a year ago. FFO on a basic basis was $7.5 million for the quarter, or $0.34 per share, compared with $5.5 million, or $0.34 per share, respectively. Funds from operations by comparison with fourth quarter 1997 reflect an increase of approximately $.02 per share. Total revenue for the three months ended March 31, 1998 was $27.2 million, an increase of $5.0 million over the same period last year. Net income for the quarter was $1.8 million, compared with $.9 million for the same quarter in 1997. Commenting on the quarter, Fox noted that, "Results by comparison to the first quarter of 1997 reflect the positive effect of the company's acquisition program and increases in rental revenues as a result of the openings of the anchor tenants at the company's redevelopment projects in Medford, Oregon Medford is a city in Jackson County, Oregon, United States. As of 2006, the city had a total population of 73,960.[1] The city was named in the 1880s by David Loring, a civil engineer working for the Oregon and California Railroad for his home town of Medford, and Covina Covina (kōvē`nə), city (1990 pop. 43,207), Los Angeles co., S Calif.; inc. 1901. The area was settled in 1842, citrus crops were introduced in 1886, and the citrus industry reached its peak in the 1930s when Covina was one of the world's (Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. ), Calif., along with an increase in straight-line straight-line adj. 1. Lying in a straight line. 2. Relating to a device whose linkage produces or copies motion in straight lines. 3. rental revenues. Offsetting these increases were decreases as a result of under-performance at the company's Fontana Fontana, city (1990 pop. 87,535), San Bernardino co., S Calif., at the foot of the San Bernardino Mts.; inc. 1952. Fabricated metal products, construction materials, and transportation equipment are manufactured, and there is a small steel mill. property and a decrease in rental income Noun 1. rental income - income received from rental properties income - the financial gain (earned or unearned) accruing over a given period of time from the company's regional malls." Fox also noted, "The company's acquisitions and redevelopment projects will contribute positively to our earnings going forward. "Offsetting these increases, the company anticipates an increase in general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. as a result of a required change in accounting policy regarding the cost of its internal acquisition department. Separately, the company ceased recording a reserve against its straight-line rental revenue. The net effect of these two accounting changes will reduce future funds from operations. "The company's new senior management team is implementing new detailed business plans for each of the portfolio assets. It has become apparent that the Fontana asset will continue to under-perform and previous expectations for the property were unrealistic. In addition, the regional malls are performing below previous lease-up objectives. Management is focused on utilizing the resources necessary to address these issues." Fox further mentioned: "The portfolio has substantial potential to provide internal growth from its existing level of 90% portfolio occupancy (excluding the single tenant facilities). Each one percent improvement in occupancy equates to $0.015 per share in increased annual funds from operations. It is likely that the material benefits from such lease-up will be recognized in 1999. "We are pleased with the performance of the company so far this year and anticipate that the real benefits of the many changes underway at the company will impact FFO most strongly during 1999. "However, as a result of the circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or discussed above, the company does not anticipate, barring exceptional events, that quarterly funds from operations per diluted share will be materially above first quarter results for the balance of the year. The company does anticipate that 1998 annual funds from operations per diluted share will show an increase by comparison to 1997. "The opportunities for both internal and external growth are significant. Our acquisitions to date demonstrate the growth which is available within our marketplace. Our pipeline remains full of quality assets which can be acquired on an accretive basis, and we look forward to integrating these into our portfolio. We are committed to aggressively managing our company to maximize shareholder value." NEW MANAGEMENT TEAM IN PLACE The principal change required at the company to enable management to maximize shareholder value was to put in place a team that could unlock the potential within the core portfolio as well as future acquisitions. That management team is now in place and is fully aligned with the interests of the stockholders. The company announced in March the appointment of Fox as president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , followed by the appointment in April of two new senior vice presidents, William William, crown prince of Germany William or Frederick William, 1882–1951, crown prince of Germany, son of William II. In World War I he commanded (1914) an army on the Western Front and was nominal commander in the German attack P. Hewitt Hewitt may refer to:
In addition, Mark Granados Gra·na·dos , Enrique 1867-1916. Spanish pianist and composer noted for his nationalistic music, such as Goyescas (1912-1914), piano works inspired by the paintings of Goya. joined the company in January January: see month. as vice president of acquisitions. These appointments reflect the company's commitment to build upon the strengths of the existing executive team. Hewitt, as a senior vice president of Forest City Development since 1988, was responsible for its West Coast retail portfolio, totaling in excess of 5 million square feet. During his tenure at Forest City, Hewitt coordinated new developments and oversaw o·ver·saw v. Past tense of oversee. leasing for West Coast properties, raising and maintaining occupancy levels in all properties above the national average. Paggi has more than 25 years of experience in shopping center shopping center, a concentration of retail, service, and entertainment enterprises designed to serve the surrounding region. The modern shopping center differs from its antecedents—bazaars and marketplaces—in that the shops are usually amalgamated into leasing and development. Most recently Paggi was senior vice president responsible for retail development consultation and supervision of project leasing for Blatteis Realty realty n. a short form of "real estate." (See: real estate) REALTY. An abstract of real, as distinguished from personalty. Realty relates to lands and tenements, rents or other hereditaments. Vide Real Property. Co., a 75-year-old firm specializing in retail properties nationally. ACQUISITION ACTIVITY Since April 1, 1998, the company has acquired an additional four shopping centers in California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). , Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. and Arizona Arizona (âr'əzō`nə), state in the southwestern United States. It is bordered by Utah (N), New Mexico (E), Mexico (S), and, across the Colorado R., Nevada and California (W). , comprising 608,126 square feet of company-owned gross leaseable area ("GLA"). The investment of $48.5 million included the following:
-- Sixth Avenue Plaza, acquired April 30, is a 139,107-square-foot
shopping center anchored by Longs Drugs, Sears, Family Bargain
Center and True Value Hardware, located in Tacoma, Wash.
-- Southern Palms Plaza, the company's first shopping center
acquisition in Arizona, was acquired April 30 and is located in
Tempe (Phoenix). The 254,863-square-foot shopping center is
anchored by a Mega Foods
market, Helig-Meyer Furniture, Outback Steakhouse, Joe's
Crabshack and McDonalds.
-- Mineral King Plaza, acquired May 1, a 114,942-square-foot
shopping center, anchored by Vons and Longs Drugs, is located in
Visalia, Calif., and is the final property in a portfolio
acquired from Hughes Investments.
-- Madera Marketplace, acquired May 12, is a 294,059-square-foot
shopping center in Madera, Calif. The center is anchored by
WalMart and Safeway. The company acquired 175,096 square feet of
the center, including the Safeway market. The property marks the
continuation of the company's expansion in the Central California
market.
Short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. funding for the acquisitions was provided using the company's credit facility. Long-term funding for the acquisitions included the assumption of approximately $3.4 million in non-recourse mortgage financing and the issuance of approximately $5.4 million in Operating Partnership Units (comprising 335,128 OP units). The principal source of long-term funding will be a portion of the remaining equity commitment from an affiliate of Lazard Freres Real Estate Investors A real estate investor is someone who actively or passively invests in real estate. An active investor may buy a property, make repairs and/or improvements to the property, and sell it later for a profit. LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control ("LFREI"), which is currently $135 million. The company anticipates drawing the balance of the commitment during 1998. During the first quarter of 1998, the company completed the acquisition of eight centers, at a cost of $114 million, totaling approximately 1,052,000 square feet of company-owned GLA. In the third and fourth quarters of 1997 the company acquired eight centers with approximately 1.0 million square feet at a cost of $91 million. Since the investment by LFREI in August 1997, the company has now acquired in excess of $250 million in properties and has significantly expanded its presence in the Pacific Northwest and Northern and Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, . "The quality and volume of the acquisitions accomplished since the LFREI investment are a demonstration of the new direction and focus of the company and an indicator of the level of acquisitions that we anticipate in 1998. "We continue to be pleased with the pace, quality and yields of our acquisitions. Since January 1 we have acquired in excess of $160 million in properties and we are confidant that we will be able to continue this pace during the balance of 1998," Fox said. REPOSITIONING OF COMPANY CONTINUES WITH NAME CHANGE Continuing the strategic repositioning of the company and reflecting its new direction, Alexander Haagen Properties Inc. is changing its name to CenterTrust Retail Properties Inc. The name change to CenterTrust Retail Properties Inc. will be submitted to a vote of the shareholders at the company's Annual Meeting scheduled for June 25 at the Marriott Hotel in Manhattan Beach, Calif. In the interim, the company will continue to trade as Alexander Haagen Properties (AMEX-ACH). "As CenterTrust Retail Properties, our name and identity will be clearly aligned with our real estate focus and the change is indicative of the Company's new direction," added Fox. "There is a tremendous opportunity for consolidation in our sector. The ownership of community retail properties remains among the most fragmented frag·ment n. 1. A small part broken off or detached. 2. An incomplete or isolated portion; a bit: overheard fragments of their conversation; extant fragments of an old manuscript. 3. of any asset type. We will continue to build our portfolio through both acquisition and development." PROFILE The company is a fully integrated, self-managed real estate investment trust, and a leading developer, owner and manager of retail shopping centers in the Western United States Noun 1. western United States - the region of the United States lying to the west of the Mississippi River West Santa Fe Trail - a trail that extends from Missouri to New Mexico; an important route for settlers moving west in the 19th century . The company owns or controls a portfolio of 58 retail properties, comprised of 42 unenclosed anchored shopping centers, two regional malls and 14 single tenant facilities. -0- Certain statements contained in this release are forward-looking within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. involve known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from what is currently anticipated. Those risks include, among others, national and local economic, business and real estate conditions that will, among other things, affect demand for retail properties, availability and creditworthiness Creditworthiness The condition in which the risk of default on a debt obligation by that entity is deemed low. Creditworthiness Eligibility of an individual or firm to borrow money. of prospective tenants, the level of lease rents and the availability of financing for both tenants and the company, adverse changes in the real estate markets including, among other things, competition with other companies, risks of real estate acquisition and development (including the failure of pending acquisitions to close and successful completion of renovations), governmental actions and initiatives, and environmental/safety requirements, and other risks detailed from time to time in the company's SEC filings. -0-
ALEXANDER HAAGEN PROPERTIES INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
March 31, Dec. 31,
1998 1997
(unaudited)
ASSETS
Rental properties $ 902,455 $ 783,279
Accumulated depreciation
and amortization (126,106) (121,202)
Rental properties, net 776,349 662,077
Cash and cash equivalents 5,666 3,613
Tenant receivables, net 7,464 6,017
Other receivables 6,530 4,449
Restricted cash 7,005 9,435
Note receivable from officer 3,088 3,126
Deferred charges, net 18,976 19,759
Other assets 2,078 2,237
Total $ 827,156 $ 710,713
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Secured debt $ 386,041 $ 313,660
7 1/2% Convertible subordinated debentures 138,599 138,599
7 1/4% Exchangeable subordinated debentures 30,000 30,000
Accrued distributions 8,427 7,371
Accrued interest 4,206 5,604
Accounts payable and other accrued expenses 7,926 8,482
Accrued construction costs 6,091 10,996
Tenant security and other deposits 5,395 4,729
Total liabilities 586,685 519,441
MINORITY INTERESTS
Operating partnership (5,193,261 and
4,280,789 units issued as of March 31, 1998
and Dec. 31, 1997, respectively) 51,273 39,685
Other minorities 1,657 1,748
Total minority interest 52,930 41,433
REDEEMABLE COMMON STOCK
510,034 shares outstanding
as of March 31, 1998 and
Dec. 31, 1997, redeemable
on May 25, 1999 8,543 8,385
STOCKHOLDERS' EQUITY
Common stock ($.01 par value,
50 million shares authorized;
18,504,124 and 15,664,814 shares
issued and outstanding as of
March 31, 1998 and Dec. 31, 1997,
respectively) 185 157
Additional paid-in capital 266,553 223,972
Accumulated distributions and deficit (87,740) (82,675)
Total stockholders' equity 178,998 141,454
Total $ 827,156 $ 710,713
-0-
ALEXANDER HAAGEN PROPERTIES INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended
March 31,
1998 1997
(unaudited)
Rental revenues $ 19,532 $ 15,926
Expense reimbursements 6,173 4,987
Percentage rents 239 271
Other income 1,225 999
Total revenues 27,169 22,183
Interest 10,254 8,897
Depreciation and amortization 5,389 4,315
Property operating costs:
Common area 4,077 3,349
Property taxes 2,772 2,076
Leasehold rentals 411 403
Marketing 75 112
Other operating 430 452
General and administrative 1,469 1,238
Total expenses 24,877 20,842
Income from operations before minority interest 2,292 1,341
Minority interests - Operating partnership (443) (332)
Minority interests - Other (69) (76)
Net Income $ 1,780 $ 933
Income Per Share:
Basic income per share $ 0.10 $ 0.08
Diluted income per share $ 0.08 $ 0.06
Basic weighted average number of shares 17,646 12,024
Diluted weighted average number of shares 22,142 16,311
-0-
ALEXANDER HAAGEN PROPERTIES, INC.
COMPUTATION OF FUNDS FROM OPERATIONS
(in thousands, except per share data)
Three Months Ended
March 31,
1998 1997
(unaudited)
Funds from operations (FFO):
Net Income $ 1,780 $ 933
Adjustments to reconcile net income to FFO:
Depreciation of real property 5,348 4,302
Minority interests 367 259
Other 25 ---
Funds From Operations - Basic 7,520 5,494
Adjustments to reconcile Basic to Diluted FFO:
Debenture interest 3,142 3,142
Amortization of deferred costs - Debentures 325 325
Funds From Operations - Diluted(b) $10,987 $ 8,961
PER SHARE:
Funds from operations - Basic(a) $ 0.34 $ 0.34
Funds from operations - Diluted(a),(b) $ 0.35 $ 0.35
Dividend $ 0.36 $ 0.36
Weighted average number of shares
Basic(a) 22,020 16,311
Diluted(a),(b) 31,509 25,678
Notes:
(a) Includes Operating Partnership Units.
(b) For purposes of computing FFO, diluted information assumes the
conversion of the company's debentures at $18 per share as well
as other common stock equivalents.
CONTACT: Alexander Haagen Properties Inc. Ned Fox or Stuart Gulland, 310/546-4520 or Casey & Sayre Inc. Barbara Casey, 310/458-1224 |
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