Crescent Real Estate Announces Fourth Quarter Results; Company Reports Fourth Quarter Office Property Same-Store NOI Growth of 5.6%.Business Editors FORT WORTH, Texas--(BUSINESS WIRE)--Feb. 22, 2001 Crescent Real Estate Equities Company Crescent Real Estate Equities Co. (NYSE: CEI) is a Fort Worth, Texas-based real estate investor with holdings mainly in office and hotel properties, including several landmark buildings in the southern United States. (NYSE NYSE See: New York Stock Exchange :CEI CEI Competitive Enterprise Institute CEI Conferenza Episcopale Italiana (Italian bishop conference) CEI Central European Initiative CEI Comitato Elettrotecnico Italiano (Italian Electrotechnical Committee) ) announced fourth quarter 2000 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 FFO See: Funds from operations ") per share of $.77, which exceeded the Company's estimates for the quarter by $.06 per share. The increase was primarily due to favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. office results and collection of rent from the behavioral behavioral pertaining to behavior. behavioral disorders see vice. behavioral seizure see psychomotor seizure. healthcare properties. For the year, the Company reported FFO per share of $2.54. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. John C. Goff n. 1. A silly clown. 1. A game. See Golf. , chief executive officer, "I am extremely pleased with our accomplishments this past year. Among our achievements, we refinanced $850 million of debt, generated over $650 million of capital within the company primarily through office and behavioral healthcare asset dispositions, repurchased nearly 12% of our outstanding common shares, and significantly enhanced our senior management team with the addition of three key executives. With the critical steps of our strategic plan completed, we are poised to take advantage of new opportunities." 4th Quarter Highlights: -- Overall Houston office vacancy for all classes is 12%, which is the city's lowest in ten years, as noted by the CoStar Group. -- The December unemployment rate of 3.0%, the lowest rate the city has ever seen, remains below the state (3.4%) and national (3.7%) levels. According to recent Bureau of Labor Statistics, Houston added 61,200 new jobs, which represents a 3.0% year-over-year increase. Houston ranked second in employment percentage growth in 2000 among the top 10 most populous U.S. metropolitan areas, according to the Houston branch of the Federal Reserve Bank. FINANCIAL REVIEW FFO for the three months ended December December: see month. 31, 2000 was $94.7 million, or $.77 per share and equivalent unit (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. ), compared to $101.2 million, or $.75 per share and equivalent unit (diluted) for the same period in 1999. FFO for the year ended December 31, 2000 was $326.9 million, or $2.54 per share and equivalent unit (diluted), compared to $355.8 million, or $2.58 per share and equivalent unit (diluted) for the same period in 1999. Net income available to common shareholders for the three months ended December 31, 2000 was $74.4 million, or $.68 per share (diluted), compared to $18.1 million, or $.15 per share (diluted) for the same period in 1999. Net income available to common shareholders for the year ended December 31, 2000 was $231.7 million, or $2.02 per share (diluted), compared to a loss of $7.4 million, or $.06 per share (diluted) for the same period in 1999. INVESTMENT SEGMENTS Office Operations Office property same-store NOI NOI Net Operating Income NOI Notice of Intent NOI Nation of Islam NOI Notice of Inquiry NOI Neuro Orthopaedic Institute NOI New Organizing Institute NOI Notice of Interest NOI No Offense Intended NOI National Olympiad in Informatics , excluding lease termination fees termination fee The one-time charge for terminating or transferring an individual retirement account. If a financial institution charges a termination fee, the fee must be spelled out in the original agreement that is signed when the account is opened. , increased 5.6% for the three months ended December 31, 2000 over the same period in 1999 for the 27.2 million square feet of office property space owned during both periods. Average occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy for these properties for the three months ended December 31, 2000 was 92.8% compared to 92.1% for the same period in 1999. Office property same-store NOI, excluding lease termination fees, increased 5.3% for the year ended December 31, 2000 over the same period in 1999. Average occupancy for these properties during both years 2000 and 1999 was 92.2%. As of December 31, 2000, the overall office portfolio was approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 94.4% leased based on executed executed 1) adj. to have been completed. (Example: "it is an executed contract") 2) v. to have completed or fully performed. (Example: "he executed all the promises made in the contract") 3) v. leases. During the three months ended December 31, 2000, Crescent crescent, emblematic representation of the quarter moon. The crescent and star, ancient Byzantine symbols that became the emblems of Constantinople, were also assumed as the standard of the Ottoman Turks. received $7.0 million of lease termination fees. The Company renewed re·new v. re·newed, re·new·ing, re·news v.tr. 1. To make new or as if new again; restore: renewed the antique chair. 2. or re-leased 689,000 net rentable square feet during the three months ended December 31, 2000. The weighted average full-service full-ser·vice adj. Associated with or offering complete service: full-service gasoline pumps; full-service banks. rental RENTAL. A roll or list of the rents of an estate containing the description of the lands let, the names of the tenants, and other particulars connected with such estate. This is the same as rent roll, from which it is said to be corrupted. rate increased 21% and the FFO annual net effective rental rate increased 39% over the expiring ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. rates for these leases, all of which have commenced or will commence within the next twelve months. Tenant improvements related to these leases were $.82 per square foot per year and leasing costs were $.98 per square foot per year. The Company renewed or re-leased 2.6 million net rentable square feet for the year ended December 31, 2000. The weighted average full-service rental rate increased 22% and the FFO annual net effective rental rate increased 40% over the expiring rates for these leases, all of which have commenced or will commence within the next twelve months. Tenant improvements related to these leases were $1.22 per square foot per year and leasing costs were $.88 per square foot per year. As previously announced, Crescent commenced construction in November November: see month. 2000 of 5 Houston Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; Center, the newest development within Crescent's Houston Center mixed-use mixed-use adj. Containing or zoned for commercial and residential facilities or development: a 40-story mixed-use tower; a mixed-use parcel of land. complex in Houston, Texas “Houston” redirects here. For other uses, see Houston (disambiguation). Houston (pronounced /'hjuːstən/) is the largest city in the state of Texas and the . The 27 story, Class A office property, which will consist of 577,000 net rentable square feet, currently has leasing commitments for approximately 70% of the space and is expected to be completed in the fall of 2002. It is Crescent's intention to bring in a joint-venture equity partner and ultimately hold a 20% to 25% equity interest while continuing to manage and lease the property. During the year ended December 31, 2000, $320 million of net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). were received as a result of Crescent's office/other asset disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of strategy, which provided for the sale of eleven non-core or non-strategic wholly owned office properties and other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. . Included in the $320 million of net proceeds is $22 million, which was received during the three months ended December 31, 2000, related to the sales of four office/venture tech properties located within The Woodlands Woodlands refers to several places:
"We continue to see strong demand in our core office markets. Absorption absorption [Lat.,=sucking from], taking of molecules of one substance directly into another substance. It is contrasted with adsorption, in which the molecules adhere only to the surface of the second substance. outpaced new delivery in 2000 by 85% in Dallas Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. and 20% in Houston, which, in turn, is having a positive impact on market rental rates. In addition, Crescent properties are 92.7% leased in Dallas and 94.0% leased in Houston, further evidence that both markets are strong and show discipline with respect to new supply," commented Dennis Dennis is a male first name derived from the Greco-Roman name Dionysius meaning "servant of Dionysus", the Thracian god of wine, which is ultimately derived from the Greek Dios (Διος, "of Zeus") combined with Nysos or Nysa (Νυσα), where the H. Alberts, president and chief operating officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. . "For our total office portfolio, looking out over the next three years at our 10.3 million square feet of expiring space, we expect embedded Inserted into. See embedded system. office rental rate growth associated with this space to range from 20% to 30%, or $5.00 to $6.00 per square foot." Resort and Hotel Investments Resort and hotel same-store 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 for the eight properties owned during these periods increased 8% and 10% for the three months and year ended December 31, 2000, respectively, compared to the same periods in 1999. The average daily rate increased 6% and 7% for the three months and year ended December 31, 2000, respectively, compared to the same periods in 1999. Revenue per available room increased 6% and 8% for the three months and year ended December 31, 2000, respectively, compared to the same periods in 1999. As previously announced, Crescent sold The Four Seasons Hotel, located within Crescent's Houston Center mixed-use complex in Houston, Texas, in November 2000. The sales price was approximately $105 million, $56.6 million of which the Company was required to redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. preferred units owned by GMAC GMAC General Motors Acceptance Corporation GMAC Graduate Management Admission Council GMAC Give Me A Call GMAC Genetic Manipulation Advisory Committee GMAC Genetic Modification Advisory Committee (Singapore) GMAC Give Me A Chance Commercial Mortgage Corporation ("GMAC") in the partnership through which the Company owned the property. The hotel property net gain recorded during the three months ended December 31, 2000 was $28.7 million. Crescent will continue to evaluate the remaining business-class hotels for disposition over the next couple of years with respect to their individual markets in an effort to obtain optimal pricing. Residential Development Investments The Woodlands Land Development, L.P. and The Woodlands Commercial Properties Company, L.P. (collectively "The Woodlands"), The Woodlands, Texas: Average sales price per lot at The Woodlands increased by $16,000, or 35%, in 2000 compared to 1999. Residential lot sales also increased to a record 2,033 lots in 2000 compared to 1,991 lots in 1999. The Woodlands continues to achieve success from its new upscale residential development, Carlton Carl·ton , Steven Norman Known as "Steve." Born 1944. American baseball player. As a left-handed pitcher with the Philadelphia Phillies (1972-1985), he became the first pitcher to win four Cy Young Awards (1972, 1977, 1980, and 1982). Woods, a gated community gat·ed community n. A subdivision or neighborhood, often surrounded by a barrier, to which entry is restricted to residents and their guests. consisting of 519 lots located around a Jack Nicklaus Noun 1. Jack Nicklaus - United States golfer considered by many to be the greatest golfer of all time (born in 1940) Jack William Nicklaus, Nicklaus signature golf course. Since September September: see month. 2000, 128 of the 159 first-phase lots have been sold at prices ranging from $100,000 to $1 million per lot, or an average of $291,000 per lot. Additional phases within Carlton Woods are expected to be marketed to the public over the next two years. Desert Mountain Properties Limited Partnership ("Desert Mountain"), Scottsdale, Arizona Scottsdale (O'odham Vaṣai S-vaṣonĭ) is a city in Maricopa County, Arizona, United States, adjacent to Phoenix. Scottsdale has become internationally recognized as a premier and posh tourist destination, while maintaining its own identity and culture as " : With the most prestigious residential lots at Desert Mountain scheduled for development and sale during the project's last few years, average sales price per lot increased by $86,000, or 16%, in 2000 compared to 1999. Correspondingly, the volume of lot sales decreased to 178 lots in 2000 compared to 258 lots in 1999. Crescent Development Management Corporation ("CDMC CDMC Centre de Documentation de la Musique Contemporaine (French: Contemporary Music Documentation Center) CDMC Children's Digital Media Center CDMC Contemporary Music Documentation Center CDMC CINDI "), Beaver Creek, Colorado Beaver Creek is an unincorporated community located in Eagle County, Colorado, United States. Beaver Creek is located immediately south of the Town of Avon and encompasses the Beaver Creek Resort and adjacent business, lodging, and residential areas. The U.S. : CDMC sold 343 residential lots and an aggregate of 50 residential units including single-family sin·gle-fam·i·ly adj. Relating to or being a dwelling designed for one family only: a single-family home; single-family occupancy. homes, townhomes and condominiums from its 12 active development projects in 2000 compared to 410 residential lot sales and an aggregate of 73 residential unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. from 8 active development projects in 1999. Average sales price per lot decreased by $35,000, or 21%, and average sales price per residential unit increased by $57,000, or 4% in 2000 compared to 1999. As previously announced, Crescent closed on a joint-venture arrangement with Booth Creek Ski Holdings, Inc., owner of the Northstar-at-Tahoe resort, in September 2000. The ten-year development, which includes an enhanced core village with new restaurants and retail shops, hotels and spas, and an extensive residential product mix of over 2,000 condominium condominium In modern property law, individual ownership of one dwelling unit within a multidwelling building. Unit owners have undivided ownership interest in the land and those portions of the building shared in common. and townhome units, is expected to begin pre-selling in the spring of 2002. This investment is a significant part of Crescent's strategy of maintaining its residential development segment earnings stream after Desert Mountain winds down. Temperature-Controlled Logistics logistics In military science, all the activities of armed-force units in support of combat units, including transport, supply, communications, and medical aid. The term, first used by Henri Jomini, Alfred Thayer Mahan, and others, was adopted by the U.S. Investments AmeriCold's same-store EBITDAR Earnings Before Interest, Taxes, Depreciation, Amortization, and Restructuring Costs - EBITDAR An indicator of a company's financial performance calculated as: = Revenue - Expenses (excluding tax, interest, depreciation, amortization, and restructuring costs) (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
v. e·lect·ed, e·lect·ing, e·lects v.tr. 1. To select by vote for an office or for membership. 2. To pick out; select: elect an art course. to defer de·fer 1 v. de·ferred, de·fer·ring, de·fers v.tr. 1. To put off; postpone. 2. To postpone the induction of (one eligible for the military draft). v.intr. approximately $7.5 million of rent of which Crescent's share was approximately $3.0 million. For the year ended December 31, 2000 the deferral deferral - Waiting for quiet on the Ethernet. is approximately $19.0 million of which Crescent's share is approximately $7.5 million. Included in Crescent's results for the three and twelve months ended December 31, 2000 is a charge for $3.0 million and $6.5 million, respectively, for a valuation allowance related to Crescent's share of the deferred rent receivable. The landlord, in which Crescent owns a 40% interest, has agreed to restructure certain financial terms of its leases, which include adjusting the 2001 rental obligation to $146 million (which equates to the amount of 2000 cash rental payments), adjusting the 2002 rental obligation to $150 million plus contingent Fortuitous; dependent upon the possible occurrence of a future event, the existence of which is not assured. The word contingent denotes that there is no present interest or right but only a conditional one which will become effective upon the happening of the rent in certain 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 , increasing the landlord's share of maintenance capital expenditures from $5 million to $9.5 million and extending the deferred rent period to December 31, 2003 from March 11, 2002. John Goff
John William Goff (January 1 1848 - November 9 1924) was an Irish-born lawyer and judge also noted for his support of Fenian rebel movements. commented, "I believe this lease restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). is an appropriate means of supporting our investment in temperature-controlled facilities over the next couple of years. The revised terms provide the lessee One who rents real property or Personal Property from another. A lessee of land is a tenant. Cross-references Landlord and Tenant. lessee n. the person renting property under a written lease from the owner (lessor). of our facilities, AmeriCold, with the necessary financial flexibility to, among other things, increase cash flow by enabling operating efficiencies and facility improvements." Behavioral Healthcare Investments Crescent collected a total of $15.4 million of rent and interest from CBHS CBHS Christian Brothers High School (Memphis, TN) CBHS Chemical Biological Hardened Shelter during the year ended December 31, 2000, $8.4 million of which was received during the three months ended December 31, 2000. Of the 88 total core and non-core behavioral healthcare facilities held at December 31, 1999, 60 of the facilities had been sold as of December 31, 2000, generating approximately $233.7 million of net proceeds. Five of those facilities were sold during the three months ended December 31, 2000, generating approximately $15.3 million in net proceeds. Seven additional facilities were under contract or subject to a letter of intent as of December 31, 2000 and are expected to generate in excess of $17 million in net proceeds over the next few months. The remaining 21 facilities continue to be actively marketed. BALANCE SHEET REVIEW Common Share Repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. On November 10, 1999, Crescent announced that its Board of Trust Managers had authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: the repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of a portion of its outstanding common shares, from time to time in the open market or through privately negotiated transactions, in an amount not to exceed $500 million. The Company commenced its share repurchase program in March 2000. As of December 31, 2000, the Company had repurchased approximately 14.5 million common shares, nearly 12% of the Company's outstanding common shares as of December 31, 1999, at an average price of $19.43 per share, for a total purchase price of approximately $281.1 million. Of the 14.5 million common shares repurchased, approximately 700,000 shares, or $16 million, were repurchased during the three months ended December 31, 2000. Debt Composition As of December 31, 2000, total debt outstanding was $2.3 billion, a reduction of $.3 billion, or 12%, from December 31, 1999. Also variable-rate Variable-rate A varible-rate agreement, as distinguished from a fixed-rate agreement, calls for an interest rate that may fluctuate over the life of the loan. The rate is often tied to an index that reflects changes in market rates of interest. debt had been reduced to 15% of total debt outstanding as of December 31, 2000, down from 36% as of December 31, 1999. REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). MODERNIZATION modernization Transformation of a society from a rural and agrarian condition to a secular, urban, and industrial one. It is closely linked with industrialization. As societies modernize, the individual becomes increasingly important, gradually replacing the family, ACT UPDATE Crescent is continuing discussions with Crescent Operating, Inc. (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). BB:COPI COPI Chevron Overseas Petroleum Inc. COPI Construction Output Price Index (UK) COPI Court-Ordered Protected Individual .OB) ("COPI") with respect to a restructuring transaction related to certain investments as a result of the REIT Modernization Act, which took effect January January: see month. 1, 2001. Among other provisions, the new legislation allows Crescent, through its subsidiaries, to own and operate certain residential development corporations and lease certain resort/hotel properties currently owned and operated or leased by COPI. Although there is no assurance that all issues surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. the discussions can be fully resolved, Crescent remains confident that a formal transaction will be announced within the next 30 to 60 days. 2001 OUTLOOK FFO Per Share Crescent projects 2001 FFO to range between $2.60 and $2.62 per share (assuming no acquisition/investment activity or further common share repurchases), of which $.58 to $.59 per share and $.63 to $.64 per share are expected for the first and second quarters, respectively. Office Operations Crescent projects same-store NOI for its office property portfolio to increase between 4% and 6% for 2001 over 2000, based on an average occupancy range of 92% to 94%. Resort and Hotel Investments Same-store rental income for Crescent's resort and hotel portfolio is expected to increase between 4% and 6% for 2001 over 2000. In addition, average daily rate is expected to increase between 5% and 6%, and revenue per available room is expected to increase between 5% and 6%, both for 2001 over 2000. Residential Development Investments Crescent expects residential lot sales at The Woodlands to range between 1,950 lots and 2,000 lots at an average sales price per lot ranging between $60,000 and $70,000 for 2001. At Desert Mountain, Crescent expects residential lot sales to range between 125 lots and 150 lots at an average sales price per lot ranging between $800,000 and $875,000 for 2001. Within CDMC, Crescent expects residential lot sales to range between 325 lots and 375 lots at an average sales price per lot ranging between $100,000 and $125,000 for 2001. Between 180 and 220 residential units including single family homes, townhomes and condominiums are also expected to occur at an average sales price per residential unit ranging between $925,000 and $1 million. Temperature-Controlled Logistics Investments AmeriCold's same-store EBITDAR (earnings before interest, taxes, depreciation and amortization, and rent) is expected to reflect flat to 2% growth for 2001 over 2000. SUPPLEMENTAL INVESTMENT INFORMATION For additional information related to Crescent's office, resort and hotel, residential development, and temperature-controlled logistics investment segments, please refer to the attached "Supplement to Press Release". CONFERENCE CALL, WEBCAST AND PRESENTATION At 10:00AM CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. on February February: see month. 22, 2001, Crescent will hold a conference call to discuss the Company's fourth quarter results. During the call the Company will hold a question and answer session concerning business and financial matters affecting the Company. These discussions may contain information that has not been previously disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). . The Company will also make reference during the call to a presentation that will be posted on the Company's website (www.cei-crescent.com) in the Investor Relations Investor relations The process by which the corporation communicates with its investors. section. To access the conference call via phone, please dial 800/818-4442 domestically or 706/679-3110 internationally. A replay will be available through March 1, 2001, by dialing 800/642-1687 domestically or 706/645-9291 internationally. Simultaneous with the conference call will be an audio webcast on the Company's website in the Investor Relations section. The webcast and presentation will be available on Crescent's website for 30 days. 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. This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are generally characterized char·ac·ter·ize tr.v. character·ized, character·iz·ing, character·iz·es 1. To describe the qualities or peculiarities of: characterized the warden as ruthless. 2. by terms such as "believe", "expect" and "may". Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company's actual results could differ materially from those given in the forward-looking statements. The following factors might cause such a difference: -- Financing risks, such as the ability to generate revenue sufficient to service existing debt, increases in debt service associated with variable-rate debt, the ability to meet existing financial covenants and the Company's ability to consummate To carry into completion; to fulfill; to accomplish. A Common-Law Marriage is consummated when the parties live in a manner intended to bring about public recognition of their relationship as Husband and Wife. planned financings and refinancings on the terms and within the time frames anticipated; -- The Company's ability to timely lease unoccupied square footage and timely re-lease re-lease tr.v. re-leased, re-leas·ing, re-leas·es To lease again: re-leased the car. occupied oc·cu·py tr.v. oc·cu·pied, oc·cu·py·ing, oc·cu·pies 1. To fill up (time or space): a lecture that occupied three hours. 2. To dwell or reside in. 3. square footage upon expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created on favorable terms; -- Adverse changes in the financial condition of existing tenants; -- The concentration of a significant percentage of the Company's assets in Texas; -- Changes in real estate conditions (including rental rates and competition from other properties and new development of competing properties); -- Changes in conditions in the resort/business-class hotel markets or in the market for residential land or luxury residences, which include single-family homes, townhomes and condominiums, or a general downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. in the economy; -- The Company's ability to locate purchasers and close sales of the behavioral healthcare properties; -- The Company's ability to close anticipated sales of assets or joint venture transactions or other pending transactions; -- The Company's ability to find acquisition and development opportunities which meet the Company's investment strategy; -- The existence of complex regulations relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's status as a REIT, the effect of future changes in REIT requirements as a result of new legislation and the adverse consequences of the failure to qualify as a REIT; and -- Other risks detailed from time to time in the Company's filings with the SEC. Given these uncertainties, readers are cautioned not to place undue reliance on such statements. The Company is not obligated ob·li·gate tr.v. ob·li·gat·ed, ob·li·gat·ing, ob·li·gates 1. To bind, compel, or constrain by a social, legal, or moral tie. See Synonyms at force. 2. To cause to be grateful or indebted; oblige. to update these forward-looking statements to reflect any future events or circumstances. ABOUT THE COMPANY Crescent Real Estate Equities Company, one of the country's largest real estate investment trusts, owns and manages, through its subsidiaries, a diversified diversified (di·verˑ·s portfolio consisting of Class A office properties, destination resorts and spas, and residential developments. Its mission is to expand the dimensions of business to its customers and maximize In a graphical environment, to enlarge a window to the full size of the screen. See Win Maximize windows. value to its shareholders by distinguishing itself as the undisputed leader in each of its businesses. Crescent will accomplish these goals by providing exceptional customer service and asset quality, and by executing a disciplined real estate investment and operating strategy that focuses on market leadership, innovative growth opportunities, and outstanding customer, employee and partner alliances.
CRESCENT REAL ESTATE EQUITIES COMPANY
CONSOLIDATED BALANCE SHEET
(dollars in thousands)
December 31, December 31,
2000 1999
------------- -------------
(unaudited) (audited)
ASSETS:
Investments in real estate:
Land $ 310,301 $ 398,754
Land held for development or sale 116,480 95,760
Building and improvements 3,201,332 3,529,344
Furniture, fixtures and equipment 62,802 71,716
Less - accumulated depreciation (564,805) (507,520)
------------- -------------
Net investment in real estate 3,126,110 3,588,054
Cash and cash equivalents 38,966 72,926
Restricted cash and cash equivalents 94,568 87,939
Accounts receivable, net 42,200 37,204
Deferred rent receivable 82,775 74,271
Investments in real estate mortgages
and equity of unconsolidated
companies 845,317 812,494
Notes receivable, net 141,407 131,542
Other assets 160,426 146,131
------------- -------------
Total assets $ 4,531,769 $ 4,950,561
============= =============
LIABILITIES:
Borrowings under Bank Boston Credit
Facility $ -- $ 510,000
UBS Facility 553,452 --
Notes payable 1,718,443 2,088,929
Accounts payable, accrued expenses
and other liabilities 191,042 170,984
------------- -------------
Total liabilities 2,462,937 2,769,913
------------- -------------
MINORITY INTERESTS:
Operating partnership, 6,995,823 and
6,975,952 units, respectively 100,586 99,226
Investment joint ventures 236,919 24,648
------------- -------------
Total minority interests 337,505 123,874
------------- -------------
SHAREHOLDERS' EQUITY:
Preferred shares, $.01 par value,
authorized 100,000,000 shares:
6 3/4% Series A Convertible
Cumulative Preferred Shares,
8,000,000 shares issued and
outstanding at December 31, 2000
and December 31, 1999, respectively 200,000 200,000
Common shares, $.01 par value,
authorized 250,000,000 shares,
121,818,653, and 121,537,353 shares
issued and outstanding at
December 31, 2000 and
December 31, 1999, respectively 1,211 1,208
Additional paid-in capital 2,220,294 2,229,680
Deferred compensation on restricted
shares -- (41)
Retained deficit (402,337) (386,532)
Accumulated other comprehensive
income (6,734) 12,459
------------- -------------
2,012,434 2,056,774
Less - shares held in treasury, at
cost, 14,468,623 common shares at
December 31, 2000 (281,107) --
------------- -------------
Total shareholders' equity 1,731,327 2,056,774
------------- -------------
Total liabilities and shareholders'
equity $ 4,531,769 $ 4,950,561
============= =============
TOTAL COMMON SHARES AND UNITS
OUTSTANDING 121,341,676(a) 135,489,257(a)
COMMON SHARE PRICE $ 22.25 $ 18.38
MARKET VALUE OF EQUITY $ 2,899,852 $ 2,689,615
TOTAL MARKET CAPITALIZATION INCLUDING
DEBT $ 5,171,747 $ 5,288,544
(a) Units are exchangeable on a one-for-two basis for Common Shares.
CRESCENT REAL ESTATE EQUITIES COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in thousands, except per share data)
For the three months For the twelve months
ended December 31, ended December 31,
----------------------- -----------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
(unaudited) (unaudited)
REVENUES:
Office and retail
properties $ 158,051 $ 155,746 $ 606,040 $ 614,493
Hotel properties 16,379 16,727 72,114 65,237
Behavioral
healthcare
properties 8,434 4,809 15,367 41,091
Interest and other
income 7,377 5,328 24,884 25,458
----------- ----------- ----------- -----------
Total revenues 190,241 182,610 718,405 746,279
----------- ----------- ----------- -----------
EXPENSES:
Real estate taxes 18,852 20,032 83,939 84,401
Repairs and
maintenance 8,422 11,911 39,024 44,024
Other rental
property operating 35,863 31,109 127,078 128,723
Corporate general
and administrative 9,441 4,261 24,073 16,274
Interest expense 48,653 53,551 203,197 192,033
Amortization of
deferred financing
costs 2,441 2,426 9,497 10,283
Depreciation and
amortization 30,231 34,656 123,839 131,657
----------- ----------- ----------- -----------
Total expenses 153,903 157,946 610,647 607,395
----------- ----------- ----------- -----------
Operating income 36,338 24,664 107,758 138,884
OTHER INCOME AND
EXPENSE:
Equity in net income
of unconsolidated
companies:
Office and retail
properties (71) (469) 3,164 5,265
Temperature-
controlled
logistics
properties 2,567 3,563 7,432 15,039
Residential
development
properties 25,355 11,883 53,470 42,871
Other 4,016 2,845 11,645 5,122
Settlement of merger
dispute -- -- -- (15,000)
Carrying value in
excess of market
value of asset held
for sale -- (16,800) -- (16,800)
Impairment and other
charges related to
the behavioral
healthcare assets -- -- -- (162,038)
Gain on property
sales, net 27,151 -- 119,583 --
----------- ----------- ----------- -----------
Total other income
and expense 59,018 1,022 195,294 (125,541)
----------- ----------- ----------- -----------
INCOME BEFORE MINORITY
INTERESTS AND
EXTRAORDINARY ITEM 95,356 25,686 303,052 13,343
Minority interests (17,593) (3,620) (51,002) (2,384)
----------- ----------- ----------- -----------
NET INCOME BEFORE
EXTRAORDINARY ITEM 77,763 22,066 252,050 10,959
Extraordinary item -
extinguishment of
debt -- -- (3,928) --
----------- ----------- ----------- -----------
NET INCOME 77,763 22,066 248,122 10,959
Preferred share
dividends (3,375) (3,375) (13,500) (13,500)
Share repurchase
agreement return -- (583) (2,906) (583)
Forward share purchase
agreement return -- -- -- (4,317)
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $ 74,388 $ 18,108 $ 231,716 $ (7,441)
=========== =========== =========== ===========
BASIC EARNINGS PER
SHARE DATA:
Net income available
to common
shareholders before
extraordinary item $ 0.69 $ 0.15 $ 2.08 $ (0.06)
Extraordinary item -
extinguishment of
debt -- -- (0.03) --
----------- ----------- ----------- -----------
Net income available
to common
shareholders $ 0.69 $ 0.15 $ 2.05 $ (0.06)
=========== =========== =========== ===========
DILUTED EARNINGS
PER SHARE DATA:
Net income available
to common
shareholders before
extraordinary item $ 0.68 $ 0.15 $ 2.05 $ (0.06)
Extraordinary item -
extinguishment of
debt -- -- (0.03) --
----------- ----------- ----------- -----------
Net income available
to common
shareholders $ 0.68 $ 0.15 $ 2.02 $ (0.06)
=========== =========== =========== ===========
WEIGHTED AVERAGE SHARES
OUTSTANDING -
BASIC 107,834,679 120,630,053 113,524,004 122,875,772
=========== =========== =========== ===========
WEIGHTED AVERAGE SHARES
OUTSTANDING -
DILUTED 109,427,332 121,136,509 114,720,818 124,813,290
=========== =========== =========== ===========
DEBT SERVICE COVERAGE
RATIO 3.1 2.5 2.6 2.8
=========== =========== =========== ===========
CRESCENT REAL ESTATE EQUITIES COMPANY
CONSOLIDATED STATEMENTS OF FUNDS FROM OPERATIONS
(dollars in thousands, except per share data)
For the three Months For the twelve months
ended December 31, ended December 31,
----------------------- -----------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
(unaudited) (unaudited)
NET INCOME $ 77,763 $ 22,066 $ 248,122 $ 10,959
ADJUSTMENTS:
Depreciation and
amortization of real
estate assets 29,127 33,861 119,999 128,403
Gain on property
sales, net (26,574) 16,361 (119,006) 16,361
Settlement of merger
dispute -- -- -- 15,000
Extraordinary item -
extinguishment of
debt -- -- 3,928 --
Impairment adjustment
related to the
behavioral
healthcare segment
assets -- -- -- 136,435
Adjustment for
investments in real
estate mortgages and
equity of
unconsolidated
companies:
Office and retail
properties 1,451 2,507 4,973 6,110
Temperature-
controlled
logistics
properties 5,777 9,597 26,131 22,400
Residential
development
properties 579 16,974 25,130 31,725
Other -- -- -- 611
Unitholder minority
interest 9,968 3,246 31,120 1,273
Preferred stock
dividends (3,375) (3,375) (13,500) (13,500)
----------- ----------- ----------- -----------
FUNDS FROM
OPERATIONS(a)(b) $ 94,716 $ 101,237 $ 326,897 $ 355,777
=========== =========== =========== ===========
INVESTMENT SEGMENTS:
Office and retail
properties $ 95,233 $ 94,435 $ 361,574 $ 367,830
Hotel properties 16,211 16,421 71,446 64,079
Behavioral healthcare
properties 8,434 4,809 15,367 15,488
Temperature-
controlled logistics
properties 8,345 13,160 33,563 37,439
Residential
development
properties 25,935 28,858 78,600 74,597
Corporate general &
administrative (9,441) (4,261) (24,073) (16,274)
Interest expense (48,653) (53,551) (203,197) (192,033)
Preferred stock
dividends (3,375) (3,375) (13,500) (13,500)
Other (c) 2,027 4,741 7,117 18,151
----------- ----------- ----------- -----------
FUNDS FROM
OPERATIONS(b) $ 94,716 $ 101,237 $ 326,897 $ 355,777
=========== =========== =========== ===========
WEIGHTED AVERAGE SHARES
OUTSTANDING - BASIC 107,834,679 120,630,053 113,524,004 122,875,772
WEIGHTED AVERAGE
SHARES/UNITS
OUTSTANDING - DILUTED 123,442,239 134,653,631 128,731,883 137,891,561
DIVIDEND PAID PER SHARE
DURING PERIOD $ 0.550 $ 0.550 $ 2.200 $ 2.200
SUPPLEMENTAL
INFORMATION:
Rental income from
straight-line rents $ (2,815)$ (5,682)$ (14,225)$ (25,638)
Rental income from
straight-line rents
- behavioral
healthcare segment
adjustment -- -- -- 25,603
Residential
development capital
expenditures (369) (70) (1,501) (1,787)
Temperature-
controlled capital
expenditures (1,728) -- (3,762) (2,600)
Non-incremental
revenue generating
exp.:
Hotel property
capital
expenditures (2,032) (545) (7,029) (4,761)
Office and retail
property capital
expenditures (6,196) (3,151) (9,199) (6,048)
Tenant improvement
and leasing costs (9,678) (11,979) (34,674) (36,399)
Depreciation and
amortization of
non-real estate
assets 683 559 2,646 2,311
Amortization of
deferred financing
costs 2,441 2,426 9,497 10,283
(a) To calculate Basic Fund from Operations ("FFO") per share, deduct
Unitholder minority interest from FFO and divide by basic weighted
average shares outstanding.
(b) For the periods beginning after December 31, 1999, the Company has
adopted the revised definition of FFO adopted by NAREIT. Effective
January 1, 2000, the revised definition modifies the FFO
calculation to include certain nonrecurring charges.
(c) Includes interest and other income, preferred return paid to GMAC,
other unconsolidated companies, less depreciation and amortization
of non-real estate assets and amortization of deferred financing
costs.
CRESCENT REAL ESTATE EQUITIES COMPANY
SUPPLEMENT TO PRESS RELEASE DATED FEBRUARY 22, 2001
Three Months and Year Ended December 31, 2000
Office Operations
Same-store net operating income growth (in millions):
The following table shows the same-store net operating income
growth for the 27.2 million square feet of office property space owned
during these periods.
Percentage/
Three Months Three Months Point
Ended Ended Increase/
Dec. 31, 2000 Dec. 31, 1999 (Decrease)
------------- ------------- ------------
Same-store Revenues $147.8 $138.4 6.8%
Same-store Expenses 59.5 54.8 8.6%
------ ------
Net Operating Income $ 88.3 $ 83.6 5.6%
====== ======
Weighted Average Occupancy 92.8% 92.1% 0.7pt
Percentage/
Twelve Months Twelve Months Point
Ended Ended Increase/
Dec. 31, 2000 Dec. 31, 1999 (Decrease)
------------- ------------- ------------
Same-store Revenues $567.8 $542.5 4.7%
Same-store Expenses 235.1 226.6 3.8%
------ ------
Net Operating Income $332.7 $315.9 5.3%
====== ======
Weighted Average Occupancy 92.2% 92.2% 0.0pt
Leasing and rental rates:
The following table shows renewed or re-leased leasing activity
and the percentage increase of signed leasing rates compared to
expiring leasing rates.
Three Months Ended December 31, 2000
-----------------------------------------
Percentage
Signed Leases Expiring Leases Increase
------------- --------------- ----------
Renewed or re-leased (1) 689,000 sf N/A N/A
Weighted average full-
service rental rate (2) $24.16 psf $19.91 psf 21.3%
FFO annual net effective
rental rate (3) $15.04 psf $10.79 psf 39.4%
Twelve Months Ended December 31, 2000
-----------------------------------------
Percentage
Signed Leases Expiring Leases Increase
------------- --------------- ----------
Renewed or re-leased (1) 2,617,000 sf N/A N/A
Weighted average full-
service rental rate (2) $24.43 psf $20.05 psf 21.8%
FFO annual net effective
rental rate (3) $15.32 psf $10.98 psf 39.5%
(1) All of which have commenced or will commence during the next
twelve months.
(2) Including free rent, scheduled rent increases taken into account
under generally accepted accounting principles, and expense
recoveries.
(3) Calculated as weighted average full-service rental rate minus
operating expenses.
Significant leasing transactions:
The following table shows significant leases signed during the
three months ended December 31, 2000:
FFO
Annual Per-
New Net Net centage
Renewal Rent- Effec- Increase
or able tive over
Business Re- Lease Square Rental Expiring
Property Location Type leased Term Feet Rate Rate
------- -------- -------- ------ ---- ------ ------- --------
Crescent
Office Professional 10
Towers Dallas, Tx Services New yrs. 32,596 $23.65 psf N/A
Miami Financial Expan- 10
Center Miami, Fl Services sion yrs. 23,616 $23.90 psf N/A
Miami Financial Re- 9
Center Miami, Fl Services newal yrs. 10,451 $24.43 psf 93%
Houston Financial Re- 10
Center Houston, Tx Services newal yrs. 85,702 $16.95 psf 192%
Palisades Telecommuni- Re- 3
Central II Dallas, Tx cations newal yrs. 79,338 $18.36 psf 22%
Texas Market Overview -- Overall Houston office vacancy for all classes is 12%, which is the city's lowest in ten years, as noted by the CoStar Group. -- The December unemployment rate of 3.0%, the lowest rate the city has ever seen, remains below the state (3.4%) and national (3.7%) levels. According to recent Bureau of Labor Statistics, Houston added 61,200 new jobs, which represents a 3.0% year-over-year increase. Houston ranked second in employment percentage growth in 2000 among the top 10 most populous U.S. metropolitan areas, according to the Houston branch of the Federal Reserve Bank. Dallas -- A healthy Dallas/Fort Worth economy in 2000 spurred significant absorption in the office market, as reported by the CoStar Group CoStar Group, Inc. (NASDAQ: CSGP) is a leading provider of information services to commercial real estate professionals in the United States and the United Kingdom. CoStar's suite of services offers customers access via the Internet to the most comprehensive database of . 6.2 million square feet of all classes of office space was absorbed Absorbed 1. In a general business sense, when a cost is treated as an expense instead of being passed on to the customer in the form of higher prices. 2. In underwriting, when an issue has been completely sold to the public. 3. in 2000, compared to 4.8 million in 1999. -- Since 1995, Dallas/Fort Worth has outpaced all U.S. metropolitan areas in its ability to create jobs. Despite predictions that employment gains would decline in 2000, the number of new jobs increased by almost 50% over 1999, according to recent Bureau of Labor Statistics Bureau of Labor Statistics (BLS) A research agency of the U.S. Department of Labor; it compiles statistics on hours of work, average hourly earnings, employment and unemployment, consumer prices and many other variables. . 103,000 jobs were created in 2000, making it the first time since 1997 that the Dallas/Fort Worth area led the nation in job gains. -- Dallas/Fort Worth ranked fifth in the country in demand for office space in 2000, according to a recent survey by Oncor International Inc. -- Dallas/Fort Worth was named the sixth most affordable housing market in a recent survey of metropolitan areas with more than 2 million people, according to the American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Chamber of Commerce Research Association. -- The December unemployment rate of 2.5% remains below the state (3.4%) and national (3.7%) levels.
Dallas Class A Office Property Data
Three Months Twelve Months Twelve Months
Ended Ended Ended
December 31, 2000 December 31, 2000 December 31, 1999
----------------- ----------------- -----------------
Inventory at
Period End 74.0 million sf 74.0 million sf 71.7 million sf
Absorption 1.2 million sf 3.7 million sf 2.7 million sf
Occupancy at
Period End 85.5% 85.5% 82.5%
Newly Delivered -
Multi-Tenant 0.2 million sf 2.0 million sf 7.0 million sf
Construction -
Multi-Tenant at
Period End 2.9 million sf 2.9 million sf 1.8 million sf
Quoted Market
Rental Rate
at Period End $23.89 psf $23.89 psf $23.67 psf
Source: CoStar Group
-- Announced Relocations and 4th Quarter Leasing Activity: Los
Angeles based defense contractor, Northrop Grumman Corp., will
relocate its Integrated Systems Sector to Las Colinas,
bringing 250 employees to the Dallas/Fort Worth metroplex.
EngineX Networks, a network infrastructure architectural firm,
plans to move its headquarters from California to Richardson
in hopes of expanding their telecommunications sector to over
100 employees. Dell Computer Corp., a global leader in direct
computer systems, leased 75,000 square feet in north Fort
Worth to house a new 500-person sales and technical support
center. AT&T Wireless Services Inc. announced that they will
lease a 255,000 building in Plano to hold 500 to 600 sales and
marketing professionals, 70% of which will be new employees.
Chorum Technologies, a fiber optics product manufacturer,
leased 109,700 square feet in Richardson's Telecom Corridor.
Soma Networks, a technology-based company, signed 77,790
square feet in the Telecom Corridor. Eastman Kodak, the
world's largest manufacturer of imaging products, signed a
lease for 92,500 square feet in Plano. California-based Cisco
Systems, the fastest-growing internet hardware firm, leased
another 55,789 square feet in Irving.
Crescent's Dallas Class A Office Property Data
As of As of
December 31, 2000 December 31, 1999
----------------- -----------------
Inventory 10.5 million sf 10.5 million sf
Occupancy
(Based on Executed Leases) 92.7% 91.6%
Quoted Full-Service Rental Rate $26.00 psf $25.71 psf
Current Full-Service Rental Rate $22.56 psf $21.92 psf
Potential Full-Service Rental
Rate Growth 15% 17%
Source: Crescent internal reporting for all properties owned as of
December 31, 2000
Houston
-- Overall Houston office vacancy for all classes is 12%, which is the city's
lowest in ten years, as noted by the CoStar Group.
-- The December unemployment rate of 3.0%, the lowest rate the city has ever
seen, remains below the state (3.4%) and national (3.7%) levels. According to
recent Bureau of Labor Statistics, Houston added 61,200 new jobs, which
represents a 3.0% year-over-year increase. Houston ranked second in employment
percentage growth in 2000 among the top 10 most populous U.S. metropolitan
areas, according to the Houston branch of the Federal Reserve Bank.
Houston Class A Office Property Data
Three Months Twelve Months Twelve Months
Ended Ended Ended
December 31, 2000 December 31, 2000 December 31, 1999
----------------- ----------------- -----------------
Inventory at
Period End 72.9 million sf 72.9 million sf 69.1 million sf
Absorption 0.5 million sf 2.5 million sf 0.7 million sf
Occupancy at
Period End 90.0% 90.0% 91.2%
Newly Delivered -
Multi-Tenant 0.2 million sf 2.1 million sf 3.7 million sf
Construction -
Multi-Tenant at
Period End 1.0 million sf 1.0 million sf 0.3 million sf
Quoted Market
Rental Rate at
Period End $22.65 psf $22.65 psf $22.03 psf
Source: CoStar Group
-- Announced Relocations and 4th Quarter Leasing Activity: Parker
Drilling Co., a drilling services and equipment provider based
in Oklahoma, plans to relocate its headquarters of over 100
employees to Houston. Chevron Phillips Chemical Co. is
planning to build a new 195,000 square foot headquarters in
The Woodlands which will house roughly 600 employees.
Continental Airlines Inc. leased 120,000 square feet of Class
A office space in northeast Houston. VeriCenter, a
full-service applications service provider, leased 64,930
square feet in west Houston. Cyrus Networks Inc., a
technology-based company, leased 64,000 square feet off of
Houston's Southwest Freeway. Luminant Worldwide Corporation, a
leading e-business services firm, leased 62,000 square feet in
west Houston.
Crescent's Houston Class A Office Property Data
As of As of
December 31, 2000 December 31, 1999
----------------- -----------------
Inventory 8.6 million sf 8.6 million sf
Occupancy
(Based on Executed Leases) 94.0% 92.6%
Quoted Full-Service Rental Rate $22.92 psf $22.56 psf
Current Full-Service Rental Rate $19.02 psf $17.85 psf
Potential Full-Service Rental
Rate Growth 21% 26%
Source: Crescent internal reporting for all properties owned as of
December 31, 2000
Resort/Hotel
Pro-Forma Same-Store Rental Income Growth (in thousands):
The following table shows pro-forma resort/hotel property
same-store rental income, for the eight properties owned during these
periods. Pro-forma rental income includes weighted average base rent,
scheduled rent increases that would be taken into account under
generally accepted accounting principles and percentage rent.
Management believes that pro-forma rental income, which includes the
effect of the change in accounting for contingent rental revenues
adopted January 1, 2000, is the best measure of same-store rental
income growth for both years.
Three Months Three Months
Ended Ended
December 31, December 31, Percentage
2000 1999 Increase
(in thousands) ------------ ------------ ----------
Upscale Business
Class Hotels(1) $ 4,607 $ 4,371 5%
Luxury Resorts and Spas 6,157 5,531 11%
Destination Fitness
Resorts and Spas 3,484 3,314 5%
------- ------- --
All Hotels and Resorts(1) $14,248 $13,216 8%
======= ======= ==
Twelve Months Twelve Months
Ended Ended
December 31, December 31, Percentage
2000 1999 Increase
------------- ------------- ----------
(in thousands)
Upscale Business
Class Hotels(1) $18,371 $17,002 8%
Luxury Resorts and Spas 26,117 23,094 13%
Destination Fitness
Resorts and Spas 14,354 13,217 9%
------- ------- --
All Hotels and Resorts(1) $58,842 $53,313 10%
======= ======= ==
(1) Excludes The Four Seasons Hotel that was disposed of in November
2000.
Statistics:
Because of Crescent's status as a real estate investment trust for
federal income tax purposes, it does not operate the hotel and resort
properties and has leased all of them, except the Omni Austin Hotel in
Austin, Texas, to Crescent Operating, Inc. pursuant to long-term
leases. The Omni Austin Hotel is leased, pursuant to a separate
long-term lease, to HCD Austin Corporation.
The following table shows weighted average occupancy, average
daily rate and revenue per available room/guest for each category of
hotel and resort properties and in total.
Three Months Three Months Percentage/
Ended Ended Point
December 31, December 31, Increase/
2000 1999 (Decrease)
------------ ----------- ----------
Upscale Business Class Hotels (4)
Weighted average occupancy 70% 69% 1pt
Average daily rate $117 $115 2%
Revenue per available room $ 82 $ 80 3%
Luxury Resorts and Spas:
Weighted average occupancy 67% 66% 1pt
Average daily rate $280 $252 11%
Revenue per available room $187 $168 11%
Destination Fitness Resorts and Spas:
Weighted average occupancy(1) 80% 83% (3pt)
Average daily rate(2) $642 $590 9%
Revenue per available guest(3) $486 $467 4%
All Hotels and Resorts (4):
Weighted average occupancy 71% 71% 0pt
Average daily rate $234 $221 6%
Revenue per available room/guest $164 $155 6%
(1) Represents the number of paying and complimentary guests for the
period, divided by the maximum number of available guest nights,
which is the maximum number of guests that the resort can
accommodate per night, for the period.
(2) Represents the average daily "all-inclusive" guest package charges
for the period, divided by the average daily number of paying
guests for the period.
(3) Represents the total "all-inclusive" guest package charges for the
period, divided by the maximum number of available guest nights
for the period.
(4) Excludes The Four Seasons Hotel that was disposed of in November
2000.
Twelve Months Twelve Months Percentage/
Ended Ended Point
December 31, December 31, Increase/
2000 1999 (Decrease)
------------ ----------- ----------
Upscale Business Class Hotels: (4)
Weighted average occupancy 75% 72% 3pt
Average daily rate $116 $114 2%
Revenue per available room $ 86 $ 83 4%
Luxury Resorts and Spas:
Weighted average occupancy 72% 75% (3pt)
Average daily rate $298 $255 17%
Revenue per available room $216 $191 13%
Destination Fitness Resorts and Spas:
Weighted average occupancy(1) 86% 87% (1pt)
Average daily rate(2) $593 $543 9%
Revenue per available guest(3) $487 $451 8%
All Hotels and Resorts (4):
Weighted average occupancy 76% 75% 1pt
Average daily rate $238 $223 7%
Revenue per available room/guest $180 $166 8%
(1) Represents the number of paying and complimentary guests for the
period, divided by the maximum number of available guest nights,
which is the maximum number of guests that the resort can
accommodate per night, for the period.
(2) Represents the average daily "all-inclusive" guest package charges
for the period, divided by the average daily number of paying
guests for the period.
(3) Represents the total "all-inclusive" guest package charges for the
period, divided by the maximum number of available guest nights
for the period.
(4) Excludes The Four Season Hotel that was disposed of in November
2000.
Residential Development Investments
Crescent's ownership interests in its residential development
investments are primarily held through ownership of real estate
mortgages and non-voting common stock.
The Woodlands Land Development Company, L.P. and The Woodlands
Commercial Properties Company, L.P. (collectively "The Woodlands"),
The Woodlands, Texas
Statistics:
The following table shows residential lot sales at an average
price per lot and commercial land sales at an average sales price per
acre.
Three Months Ended Three Months Ended
December 31, 2000 December 31, 1999
----------------- ------------------
Residential lot sales 516 539
Average sales price per lot $111,000 $ 42,000
Commercial land sales 55 acres 49 acres
Average sales price per acre $285,000 $361,000
Twelve Months Ended Twelve Months Ended
December 31, 2000 December 31, 1999
------------------- -------------------
Residential lot sales 2,033 1,991
Average sales price per lot $ 62,000 $ 46,000
Commercial land sales 124 acres 76 acres
Average sales price per acre $308,000 $345,000
Future buildout of The Woodlands is estimated at approximately
13,600 residential lots and approximately 1,800 acres of commercial
land, of which approximately 1,350 residential lots and 1,200 acres
are currently in inventory.
Desert Mountain Properties Limited Partnership ("Desert
Mountain"), Scottsdale, Arizona
Statistics:
The following table shows residential lot sales at an average
price per lot.
Three Months Ended Three Months Ended
December 31, 2000 December 31, 1999
----------------- ------------------
Residential lot sales 39 97
Average sales price per lot(1) $628,000 $531,000
Twelve Months Ended Twelve Months Ended
December 31, 2000 December 31, 1999
------------------- -------------------
Residential lot sales 178 258
Average sales price per lot(1) $619,000 $533,000
(1) Including equity golf membership.
Approved future buildout of Desert Mountain is estimated to be in
excess of 500 residential lots, of which approximately 170 are
currently in inventory.
Crescent Development Management Corporation ("CDMC"), Beaver
Creek, Colorado
Statistics:
The following table shows total active projects, residential lot
and residential unit sales, and average sales price per lot and unit.
Three Months Ended Three Months Ended
December 31, 2000 December 31, 1999
----------------- ------------------
Active projects 12 8
Residential lot sales 210 368
Residential unit sales:
Townhome sales 13 5
Single-family home sales -- 3
Equivalent timeshare
unit sales -- --
Condominium sales 9 17
Commercial land sales 1 acre --
Average sales price per
residential lot $106,750 $151,601
Average sales price per
residential unit $1.8 million $1.2 million
Twelve Months Ended Twelve Months Ended
December 31, 2000 December 31, 1999
------------------- -------------------
Active projects 12 8
Residential lot sales 343 410
Residential unit sales:
Townhome sales 19 32
Single-family home sales 5 11
Equivalent timeshare
unit sales -- 6
Condominium sales 26 24
Commercial land sales 9 acres --
Average sales price per
residential lot $136,110 $171,357
Average sales price per
residential unit $1.6 million $1.6 million
Temperature-Controlled Logistics Investments Crescent holds an indirect 40% interest in the Temperature-Controlled Logistics Partnerships, which own the Temperature-Controlled Logistics Corporations, which directly or indirectly own the Temperature-Controlled Logistics Properties. The business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets associated with the Temperature-Controlled Logistics Properties are owned by AmeriCold Logistics, in which the Company has no interest. The Temperature-Controlled Logistics Corporations are entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: to receive lease payments from AmeriCold Logistics. The lease terms have recently been restructured, as referenced in Crescent's fourth quarter 2000 earnings press release dated February 22, 2001. |
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