PASADENA, Calif., July 25,
2022 /PRNewswire/ -- Alexandria Real Estate Equities,
Inc. (NYSE:ARE) announced financial and operating results for the
second quarter ended June 30,
2022.
Key
highlights
|
|
|
|
|
|
Operating
results
|
2Q22
|
|
2Q21
|
|
1H22
|
|
1H21
|
Total
revenues:
|
|
|
|
|
|
|
|
In millions
|
$
643.8
|
|
$ 509.6
|
|
$
1,258.8
|
|
$ 989.5
|
Growth
|
26.3 %
|
|
|
27.2 %
|
|
Net income attributable
to Alexandria's common stockholders – diluted
|
In millions
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$
269.3
|
|
$ 380.6
|
|
$
118.5
|
|
$ 388.5
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Per share
|
$
1.67
|
|
$ 2.61
|
|
$
0.74
|
|
$ 2.74
|
Funds from operations
attributable to Alexandria's common stockholders – diluted, as
adjusted
|
In millions
|
$
338.8
|
|
$ 282.3
|
|
$
663.4
|
|
$ 545.2
|
Per share
|
$
2.10
|
|
$ 1.93
|
|
$
4.15
|
|
$ 3.84
|
Ringing of the New York Stock Exchange Opening Bell to
celebrate our 25th anniversary
In celebration of our 25th anniversary as a publicly traded
company, we recently rang The Opening Bell® at the New
York Stock Exchange to mark this momentous milestone. From our
initial public offering on May 27,
1997 through May 27, 2022, we
have generated a total stockholder return ("TSR") of 1,902%,
assuming reinvestment of dividends, substantially outperforming the
MSCI U.S. REIT Index TSR of 803% and the FTSE Nareit Equity Office
Index TSR of 457%.
A REIT industry-leading high-quality roster of over 1,000
tenants with high-quality revenues and cash flows, strong margins,
and operational excellence
Percentage of total
annual rental revenue in effect from investment-grade or
publicly traded large cap tenants
|
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50 %
|
|
|
|
|
|
|
|
Sustained
strength in tenant collections:
|
|
|
|
|
Tenant receivables as of June 30, 2022
|
|
$ 7.1
|
million
|
July tenant rent and receivables collected as of July 25,
2022
|
|
99.9 %
|
|
|
|
|
|
|
|
Occupancy of operating
properties in North America
|
|
94.6 %
|
|
|
Occupancy of operating
properties in North America (excluding vacancy at
recently acquired properties)
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98.4 %
|
(1)
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Operating
margin
|
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70 %
|
|
|
Adjusted EBITDA
margin
|
|
70 %
|
|
|
|
|
|
|
|
Weighted-average
remaining lease term:
|
|
|
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All
tenants
|
|
7.1
|
years
|
Top
20 tenants
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10.2
|
years
|
|
|
|
|
(1)
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Excludes 1.6 million
RSF, or 3.8%, of vacancy at recently acquired properties
representing lease-up opportunities that are expected to provide
incremental annual rental revenue. Refer to "Occupancy" in our
Supplemental Information.
|
Record rental rate increases and continued historic high
leasing volume
- For 2Q22, rental rate increases of 45.4% and 33.9% (cash basis)
represent the second- highest and the highest quarterly increases
in Company history, respectively.
- During 2Q22, we executed 2,279,758 RSF of leasing activity,
representing the third-highest quarter of leasing volume in Company
history; 87% of this leasing activity was generated from a roster
of over 1,000 tenants and other relationships.
|
|
2Q22
|
|
1H22
|
Total leasing activity
– RSF
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|
2,279,758
|
|
4,743,196
|
Leasing of development
and redevelopment space – RSF
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|
916,436
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2,356,132
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Lease renewals and
re-leasing of space:
|
|
|
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RSF (included in total
leasing activity above)
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1,087,082
|
|
1,951,159
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Rental rate
increases
|
|
45.4 %
|
|
39.0 %
|
Rental rate increases
(cash basis)
|
|
33.9 %
|
|
25.2 %
|
Continued strong net operating income and internal
growth
- Net operating income (cash basis) of $1.6 billion for 2Q22 annualized, up $315.5 million, or 24.3%, compared to 2Q21
annualized.
- 97% of our leases contain contractual annual rent escalations
approximating 3%.
- Same property net operating income increases:
-
- 7.5% and 10.2% (cash basis) for 2Q22 over 2Q21, representing
the second- and third-highest increases in the past 10 years,
respectively.
- 7.7% and 8.6% (cash basis) for 1H22 over 1H21.
Strong valuations for partial interest sale and
dispositions
During 2Q22, we completed a partial interest sale and
dispositions aggregating $548.7
million, including:
- Sale of a 70% interest in 300 Third Street in our Cambridge/Inner Suburbs submarket for a sales
price of $166.5 million, or
$1,802 per RSF, representing
capitalization rates of 4.6% and 4.3% (cash basis).
- Sale of 12 properties in our Route 128 and Route 495 suburban
submarkets of Greater Boston for
an aggregate sales price of $334.4
million, or $542 per RSF,
representing a capitalization rate (cash basis) of 5.1%.
Strong and flexible balance sheet with significant liquidity
as of June 30, 2022
- Investment-grade credit ratings ranked in the top 10% among all
publicly traded U.S. REITs.
- Net debt and preferred stock to Adjusted EBITDA of 5.5x and
fixed-charge coverage ratio of 5.1x for 2Q22 annualized.
- Total debt and preferred stock to gross assets of 28%.
- 98.3% of our debt has a fixed rate.
- 13.6 years weighted-average remaining term of debt.
- $5.5 billion of liquidity.
Continued high demand for Alexandria's brand drives
visibility for future growth aggregating $665 million of incremental annual rental
revenue
Our highly leased value-creation pipeline of current and key
near-term projects that are under construction or that will
commence construction in the next six quarters is expected to
generate greater than $665 million of
incremental annual rental revenue, primarily commencing from 3Q22
through 2Q25.
- 7.8 million RSF of our value-creation projects, which are 78%
leased/negotiating, are either under construction or expected to
commence construction in the next six quarters.
Continued dividend strategy to share growth in cash flows
with stockholders
Common stock dividend declared for 2Q22 of $1.18 per common share, aggregating $4.60 per common share for the twelve months
ended June 30, 2022, up 24 cents, or 6%, over the twelve months ended
June 30, 2021. Our FFO payout ratio
of 56% for the three months ended June 30, 2022 allows us to
continue to share growth in cash flows from operating activities
with our stockholders while also retaining a significant portion
for reinvestment.
Seventh overall Nareit Investor CARE Award winner
We received the 2022 Nareit Investor CARE (Communications and
Reporting Excellence) Silver Award in the Large Cap Equity REIT
category for superior shareholder communications and reporting.
This represents our fifth consecutive and seventh overall Nareit
Investor CARE Award since 2015, demonstrating consistency in
delivering best-in-class transparency, quality, and efficiency in
communications and reporting to the investment community.
Key items included in operating results
Key items included in
net income attributable to Alexandria's common
stockholders:
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|
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(In millions, except
per share
amounts)
|
Amount
|
|
Per Share –
Diluted
|
|
Amount
|
|
Per Share –
Diluted
|
|
2Q22
|
|
2Q21
|
|
2Q22
|
|
2Q21
|
|
1H22
|
|
1H21
|
|
1H22
|
|
1H21
|
Unrealized (losses)
gains
on non-real estate
investments
|
$
(68.1)
|
|
$ 244.0
|
|
$
(0.42)
|
|
$
1.67
|
|
$
(331.6)
|
|
$ 197.8
|
|
$
(2.07)
|
|
$
1.39
|
Significant realized
gains
on non-real estate
investments
|
—
|
|
34.8
|
|
—
|
|
0.24
|
|
—
|
|
57.7
|
|
—
|
|
0.41
|
Gain on sales of real
estate
|
214.2
|
|
—
|
|
1.33
|
|
—
|
|
214.2
|
|
2.8
|
|
1.34
|
|
0.02
|
Impairment of real
estate
|
—
|
|
(4.9)
|
|
—
|
|
(0.03)
|
|
—
|
|
(10.1)
|
|
—
|
|
(0.07)
|
Loss on early
extinguishment of debt
|
(3.3)
|
|
—
|
|
(0.02)
|
|
—
|
|
(3.3)
|
|
(67.3)
|
|
(0.02)
|
|
(0.47)
|
Total
|
$ 142.8
|
|
$ 273.9
|
|
$
0.89
|
|
$
1.88
|
|
$
(120.7)
|
|
$ 180.9
|
|
$
(0.75)
|
|
$
1.28
|
External growth and investment in real estate
Delivery and commencement of value-creation projects
- During 2Q22, we placed into service development and
redevelopment projects aggregating 375,394 RSF across multiple
submarkets.
- 80% of construction costs related to active development and
redevelopment projects aggregating 5.9 million RSF are under a
guaranteed maximum price ("GMP") contract or other fixed contracts.
Our budgets also include construction cost contingencies in GMP
contracts plus additional landlord contingencies that generally
range between 3% and 5%.
- Annual net operating income (cash basis) is expected to
increase by $39 million upon the
burn-off of initial free rent from recently delivered
projects.
- During 2Q22, we commenced construction on six value-creation
projects aggregating 917,599 RSF, including the following
development projects:
-
- 320,809 RSF, 36% leased, at 99 Coolidge Avenue in our
Cambridge/Inner Suburbs
submarket;
- 248,018 RSF, 85% leased, at 500 North Beacon Street and 4
Kingsbury Avenue in our Cambridge/Inner Suburbs submarket;
- 90,000 RSF, 29% leased, at 9808 Medical Center Drive in our
Rockville submarket; and
- 88,038 RSF, 100% leased, at our expansion at 6040 George Watts
Hill Drive in our Research Triangle submarket.
- As of 2Q22, our highly leased value-creation pipeline of
current and key near-term projects that are under construction or
that will commence construction in the next six quarters aggregates
7.8 million RSF and is 78% leased/negotiating.
Value-creation pipeline
of new Class A development and redevelopment projects as
a percentage of gross assets
|
|
2Q22
|
Under construction
projects 75% leased/negotiating
|
|
10 %
|
Pre-leased/negotiating
near-term projects expected to commence construction in
the next six
quarters 89%
leased/negotiating
|
|
1 %
|
Income-producing/potential cash flows/covered land
play(1)
|
|
8 %
|
Land
|
|
2 %
|
|
|
|
(1)
|
Includes projects that
have existing buildings that are generating or can generate
operating cash flows. Also includes development rights associated
with existing operating campuses.
|
Alexandria is at
the vanguard of innovation for a high-quality roster of over
1,000 tenants, with a focus on accommodating their current needs
and providing them with a path for future growth
- Reduced the upper end of our range of 2022 guidance for
acquisitions by $750 million to a
range from $2.6 billion to
$2.8 billion.
- During 2Q22, we completed acquisitions in our key life science
cluster submarkets aggregating 1.1 million RSF of future
development and redevelopment opportunities for an aggregate
purchase price of $280.1
million.
Balance sheet management
Key metrics as of June 30, 2022
- $33.7 billion in total market
capitalization.
- $23.4 billion in total equity
capitalization, which ranks in the top 10% among all publicly
traded U.S. REITs.
- No debt maturities prior to 2025.
- 13.6 years weighted-average remaining term of debt.
|
|
2Q22
|
|
Goal
|
|
|
Quarter
|
|
Trailing
|
|
4Q22
|
|
|
Annualized
|
|
12 Months
|
|
Annualized
|
Net debt and preferred
stock to
Adjusted EBITDA
|
|
5.5x
|
|
|
5.9x
|
|
Less than or equal to
5.1x
|
Fixed-charge coverage
ratio
|
|
5.1x
|
|
|
5.1x
|
|
Greater than or equal
to 5.1x
|
|
Key capital events
- During 2Q22, we entered into new forward equity sales
agreements aggregating $403.4 million
to sell 2.4 million shares under our ATM program at an average
price of $169.38 per share (before
underwriting discounts). As of June 30,
2022, the remaining aggregate amount available under our ATM
program for future sales of common stock was $246.6 million.
- During 2Q22, we did not issue shares to settle our outstanding
forward equity agreements. We expect to issue an aggregate of 9.0
million shares at an average price of $187.91 per share to settle all our outstanding
forward equity sales agreements and receive net proceeds of
approximately $1.7 billion in
2H22.
- In April 2022, we repaid two
secured notes payable aggregating $195.0
million due in 2024 with an effective interest rate of
3.40%. As a result, we recognized a loss on early extinguishment of
debt of $3.3 million.
Investments
- As of June 30, 2022:
-
- Our investments aggregated $1.7
billion.
- Unrealized gains presented in our consolidated balance sheets
were $459.8 million, comprising gross
unrealized gains and losses aggregating $565.5 million and $105.7
million, respectively.
- Investment loss of $39.5 million,
presented in our consolidated statements of operations, consisted
of $28.6 million of realized gains
and $68.1 million of unrealized
losses/changes in fair value.
Subsequent event
- On July 1, 2022, Stephen A. Richardson, our Co-Chief Executive
Officer, tendered his resignation from all of his positions with
the Company and its subsidiaries, effective July 31, 2022, and notified the Company of his
intent to retire from full-time employment and his professional
career for family and personal reasons.
Industry and ESG leadership: catalyzing and leading the way
for positive change to benefit human health and society
- In June 2022, we released our
2021 ESG Report, which highlights our longstanding ESG leadership.
The report details our efforts to advance our ESG impact, including
by driving high-performance building design and operations to
reduce carbon emissions, mitigating climate-related risk in our
real estate portfolio, and investing in and providing essential
infrastructure for sustainable agrifoodtech companies. It also
showcases Alexandria's
comprehensive efforts to catalyze the health, wellness, safety, and
productivity of our employees, tenants, local communities, and the
world through the built environment and beyond, including through
our visionary social responsibility endeavors. Notable initiatives
presented in the report that highlight our innovative approach
include:
-
- Furthering the development of our approach to physical and
transitional climate-related risk by initiating a process to assess
and understand potential physical risk and pathways to mitigate and
adapt to climate change, as well as preparing for the transition to
a low-carbon economy and continuing to develop science-based
targets;
- Implementing innovative solutions to minimize fossil fuel use
in our state-of-the-art laboratory development projects, such as at
325 Binney Street, which will harness geothermal energy to target a
LEED Zero Energy certification and a 92% reduction in fossil fuel
use as a key component of its design to be the most sustainable
laboratory building in Cambridge;
at 751 Gateway Boulevard, which is pursuing electrification and is
tracking to be the first all-electric laboratory building in
South San Francisco; and at the
Alexandria Center® for Life Science – South Lake Union
mega campus in Seattle, where the
Company is incorporating an innovative wastewater heat recovery
system; and
- Increasing our investment in renewable electricity to mitigate
carbon emissions in our existing asset base, including through a
large-scale solar power purchase agreement that will significantly
increase the supply of renewable electricity to our Greater Boston market starting in 2024.
About Alexandria Real Estate Equities, Inc.
Alexandria Real Estate Equities, Inc. (NYSE:ARE), an S&P
500® urban office REIT, is the first,
longest-tenured, and pioneering owner, operator, and developer
uniquely focused on collaborative life science, agtech, and
technology campuses in AAA innovation cluster locations, with a
total market capitalization of $33.7
billion and an asset base in North
America of 74.1 million SF as of June 30, 2022. The
asset base in North America
includes 41.1 million RSF of operating properties and 5.9 million
RSF of Class A properties undergoing construction, 9.9 million
RSF of near-term and intermediate-term development and
redevelopment projects, and 17.2 million SF of future development
projects. Founded in 1994, Alexandria pioneered this niche and has since
established a significant market presence in key locations,
including Greater Boston, the
San Francisco Bay Area,
New York City, San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a longstanding and proven track
record of developing Class A properties clustered in urban life
science, agtech, and technology campuses that provide our
innovative tenants with highly dynamic and collaborative
environments that enhance their ability to successfully recruit and
retain world-class talent and inspire productivity, efficiency,
creativity, and success. Alexandria also provides strategic capital to
transformative life science, agtech, and technology companies
through our venture capital platform. We believe our unique
business model and diligent underwriting ensure a high-quality and
diverse tenant base that results in higher occupancy levels, longer
lease terms, higher rental income, higher returns, and greater
long-term asset value. For additional information on Alexandria, please visit www.are.com.
Acquisitions June 30, 2022
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
Square
Footage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions With
Development/Redevelopment
Opportunities(1)
|
|
|
|
|
|
|
|
Property
|
|
Submarket/Market
|
|
Date
of
Purchase
|
|
Number of
Properties
|
|
Operating
Occupancy
|
|
Future
Development
|
|
Operating With
Future Development/
Redevelopment
|
|
Operating(2)
|
|
Operating
|
|
Total(3)
|
|
Purchase
Price
|
|
Completed in
1Q22
|
|
|
|
|
|
29
|
|
91 %
|
|
4,617,991
|
|
2,668,494
|
|
451,760
|
|
—
|
|
7,306,305
|
|
$
|
1,840,717
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Completed in
2Q22:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One Hampshire
Street(4)
|
|
Cambridge/Inner
Suburbs/
Greater Boston
|
|
6/23/22
|
|
1
|
|
100 %
|
|
—
|
|
88,591
|
|
—
|
|
—
|
|
88,591
|
|
|
140,000
|
|
Other
|
|
Various
|
|
Various
|
|
2
|
|
76
|
|
869,000
|
|
109,557
|
|
—
|
|
—
|
|
978,557
|
|
|
140,146
|
|
|
|
|
|
|
|
3
|
|
87 %
|
|
869,000
|
|
198,148
|
(5)
|
—
|
(5)
|
—
|
(5)
|
1,067,148
|
|
|
280,146
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Completed in July
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,561
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,130,424
|
|
Pending(6)
|
|
Various
|
|
3Q22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
275,000
|
|
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
244,576
|
|
2022 acquisitions
(midpoint)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
2,650,000
|
|
2022 guidance
range(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$2,550,000 –
$2,750,000
|
|
|
(1)
|
We expect to provide
total estimated costs and related yields for development and
redevelopment projects in the future, subsequent to the
commencement of construction.
|
(2)
|
Represents the
operating component of our value-creation acquisitions that is not
expected to undergo future development or redevelopment.
|
(3)
|
Represents total square
footage upon completion of development or redevelopment of a new
Class A property. Square footage presented includes RSF of
buildings currently in operation with future development or
redevelopment opportunities. We intend to demolish and develop or
to redevelop the existing properties upon expiration of the
existing in-place leases. Refer to "Definitions and
reconciliations" in our Supplemental Information for additional
details on value-creation square feet currently included in rental
properties.
|
(4)
|
Represents the
acquisition of a condominium in two floors of a seven-story
building.
|
(5)
|
We expect the
acquisitions completed during the three months ended June 30, 2022
to generate initial annual net operating income of approximately $9
million for the twelve months following acquisition. These
acquisitions included three operating properties with a
weighted-average acquisition date of June 16, 2022 (weighted by
initial annual net operating income).
|
(6)
|
Represents acquisitions
of land parcels to expand our mega campuses in our Cambridge and
University Town Center submarkets.
|
(7)
|
We reduced the upper
end of our range of 2022 guidance for acquisitions by $750 million.
Refer to "Guidance" on page 6 of this Earnings Press Release for
additional information.
|
|
|
|
Dispositions and
Sales of Partial Interest
June 30, 2022
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capitalization
Rate
(Cash
Basis)
|
|
|
|
|
|
Sales Price
per RSF
|
|
Gain or
Consideration
in Excess of
Book Value
|
|
Property
|
|
Submarket/Market
|
|
Date of
Sale
|
|
Interest
Sold
|
|
RSF
|
|
Capitalization
Rate
|
|
|
Sales
Price
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Completed
1H22:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
100 Binney
Street
|
|
Cambridge/Inner
Suburbs/Greater
Boston
|
|
3/30/22
|
|
70 %
|
|
|
432,931
|
|
3.6 %
|
|
|
3.5 %
|
|
|
$
713,228
|
(1)
|
$
2,353
|
|
|
$ 413,615
|
(2)
|
|
300 Third
Street
|
|
Cambridge/Inner
Suburbs/Greater
Boston
|
|
6/27/22
|
|
70 %
|
|
|
131,963
|
|
4.6 %
|
|
|
4.3 %
|
|
|
166,485
|
(1)
|
$
1,802
|
|
|
113,020
|
(2)
|
|
Alexandria Park at 128,
285 Bear Hill
Road, 111 and 130 Forbes
Boulevard, and 20 Walkup Drive
|
|
Route 128 and Route
495/Greater
Boston
|
|
6/8/22
|
|
100 %
|
|
|
617,043
|
|
5.1 %
|
|
|
5.1 %
|
|
|
334,397
|
|
$ 542
|
|
|
202,325
|
|
|
Other
|
|
|
|
|
|
|
|
|
|
|
N/A
|
|
|
N/A
|
|
|
47,800
|
|
N/A
|
|
|
11,895
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,261,910
|
|
|
|
|
$ 740,855
|
|
|
Completed in July
2022:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1450 Owens
Street
|
|
Mission Bay/San
Francisco Bay Area
|
|
7/1/22
|
|
20 %
|
(3)
|
|
191,000
|
|
N/A
|
|
|
N/A
|
|
|
25,039
|
(1)
|
N/A
|
|
|
$
10,083
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,286,949
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pending
|
|
San Diego
|
|
3Q22
|
|
TBD
|
|
|
TBD
|
|
|
|
|
|
|
|
140,000
– 160,000
|
|
|
|
|
TBD
|
|
|
Other
|
|
|
|
TBD
|
|
TBD
|
|
|
TBD
|
|
|
|
|
|
|
|
588,051
|
|
|
|
|
TBD
|
|
|
2022 dispositions
(midpoint)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
2,025,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 guidance
range
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1,450,000 –
$2,600,000
|
|
|
|
|
|
|
|
|
|
(1)
|
Represents the
contractual sales price for the percentage interest of the property
sold by us.
|
(2)
|
We retained control
over the newly formed real estate joint venture and therefore
continued to consolidate this property. We accounted for the
difference between the consideration received and the book value of
the interest sold as an equity transaction, with no gain or loss
recognized in earnings.
|
(3)
|
Relates to the sale of
a land parcel. Upon completion of the transaction, the
noncontrolling interest share for our joint venture partner is 20%
and is anticipated to increase to 75% as our partner contributes
capital for construction over time.
|
Guidance
June 30, 2022
(Dollars in millions)
The following updated guidance is based on our current view of
existing market conditions and assumptions for the year ending
December 31, 2022. There can be no
assurance that actual amounts will not be materially higher or
lower than these expectations. Also, refer to our discussion of
"forward-looking statements" on page 8 of this Earnings Press
Release for additional details.
Key changes to our guidance include the reduction of an
aggregate $635 million to our uses of
capital, comprising a $350 million
reduction in acquisitions and a $285
million reduction in construction spending. This reduction
was offset by construction spending from January through
June 2022, which increased by
$335 million to slightly above the
high end of our previous guidance range, as a result of
construction spending associated with the leasing of our
development and redevelopment projects under construction and our
near-term pipeline projects. In addition, the midpoint of our
guidance for funds from operations per share, as adjusted increased
by three cents driven by strong same
property performance and general and administrative savings in 2H22
resulting from the retirement of Stephen A.
Richardson, our Co-Chief Executive Officer.
|
|
|
|
|
|
|
|
|
|
|
|
2022
Guidance
|
|
Reduction in uses of
capital
|
|
|
|
Reduction
|
|
|
|
Summary of key
changes in guidance
|
|
|
|
As of
7/25/22
|
|
As of
4/25/22
|
|
Construction
|
|
|
|
$285
|
|
|
|
EPS, FFO per share, and
FFO per share, as adjusted
|
|
|
|
Refer to page
7
|
|
Acquisitions
|
|
|
|
$350
|
|
|
|
Same property net
operating income increase
|
|
|
|
6.0% to 8.0%
|
|
5.9% to 7.9%
|
|
|
|
|
|
|
|
|
|
Same property net
operating income increase (cash basis)
|
|
|
|
6.8% to 8.8%
|
|
6.5% to 8.5%
|
|
|
|
|
|
|
|
|
|
General and
administrative expenses
|
|
|
|
$172 to $180
|
|
$168 to $176
|
|
|
|
|
|
As of
7/25/22
|
|
|
|
Key Sources and Uses
of Capital
|
|
Range
|
|
Midpoint
|
|
Certain
Completed
Items
|
|
As of
4/25/22
Midpoint
|
|
Key
Changes to
Midpoint
|
|
Sources of
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities after dividends
|
|
$
275
|
|
$
325
|
|
$
|
300
|
|
|
|
|
$
300
|
|
|
|
Net incremental
debt
|
|
1,361
|
|
561
|
|
|
961
|
|
See below
|
|
950
|
|
|
|
Dispositions and sales
of partial interest (refer to page 5)
|
|
1,450
|
|
2,600
|
|
|
2,025
|
|
$
1,287
|
|
|
1,950
|
|
$
75
|
|
Common
equity
|
|
2,364
|
|
2,364
|
|
|
2,364
|
|
$
2,364
|
(1)
|
|
2,750
|
|
$
(386)
|
|
Total sources of
capital
|
|
$
5,450
|
|
$
5,850
|
|
$
|
5,650
|
|
|
|
|
$
5,950
|
|
|
|
Uses of
capital:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Construction
|
|
$
2,900
|
|
$
3,100
|
|
$
|
3,000
|
|
|
|
|
$
2,950
|
|
$
50
|
|
Acquisitions (refer to
page 4)
|
|
2,550
|
|
2,750
|
|
|
2,650
|
|
$
2,130
|
|
|
3,000
|
|
$
(350)
|
|
Total uses of
capital
|
|
$
5,450
|
|
$
5,850
|
|
$
|
5,650
|
|
|
|
|
$
5,950
|
|
|
|
Incremental debt
(included above):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of unsecured
senior notes payable
|
|
$
1,800
|
|
$
1,800
|
|
$
|
1,800
|
|
$
1,800
|
|
|
$
1,800
|
|
|
|
Repayments of secured
notes payable
|
|
(195)
|
|
(195)
|
|
|
(195)
|
|
$
(195)
|
|
|
(195)
|
|
|
|
Unsecured senior line
of credit, commercial paper, and other
|
|
(44)
|
|
(744)
|
|
|
(394)
|
|
|
|
|
(655)
|
|
|
|
Incremental cash
expected to be held at December 31, 2022(2)
|
|
(200)
|
|
(300)
|
|
|
(250)
|
|
|
|
|
—
|
|
$
(250)
|
|
Net incremental
debt
|
|
$
1,361
|
|
$
561
|
|
$
|
961
|
|
|
|
|
$
950
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Refer to "Key capital
events" on page 3 of this Earnings Press Release for additional
details. During the six months ended June 30, 2022, we entered into
new forward equity sales agreements aggregating $2.4 billion to
sell 12.3 million shares of our common stock. During 1Q22, we
settled a portion of these forward equity sales agreements by
issuing 3.2 million shares and received net proceeds of $648.2
million. We expect to issue 9.0 million shares to settle our
remaining outstanding forward equity sales agreements and receive
net proceeds of approximately $1.7 billion in 2022.
|
(2)
|
We expect this
forecasted cash at December 31, 2022 to result in a reduction of
our 2023 debt capital needs.
|
|
|
|
|
Projected 2022
Earnings per Share and Funds From Operations per Share Attributable
to Alexandria's Common Stockholders – Diluted
|
|
|
|
As of
7/25/22
|
|
As of
4/25/22
|
|
Earnings per
share(1)
|
|
$2.14 to
$2.20
|
|
$1.08 to
$1.18
|
|
Depreciation and
amortization of real estate assets
|
|
|
5.50
|
|
|
|
5.65
|
|
|
Gain on sales of real
estate
|
|
|
(1.34)
|
|
|
|
—
|
|
|
Allocation to unvested
restricted stock awards
|
|
|
(0.02)
|
|
|
|
(0.02)
|
|
|
Funds from operations
per share(2)
|
|
$6.28 to
$6.34
|
|
$6.71 to
$6.81
|
|
Unrealized losses on
non-real estate investments
|
|
|
2.07
|
|
|
|
1.67
|
|
|
Loss on early
extinguishment of debt(3)
|
|
|
0.02
|
|
|
|
0.02
|
|
|
Acceleration of stock
compensation due to executive officer
resignation(4)
|
|
|
0.04
|
|
|
|
—
|
|
|
Allocation to unvested
restricted stock awards
|
|
|
(0.02)
|
|
|
|
(0.02)
|
|
|
Other
|
|
|
(0.01)
|
|
|
|
(0.05)
|
|
|
Funds from operations
per share, as adjusted(1)
|
|
$8.38 to
$8.44
|
|
$8.33 to
$8.43
|
|
Midpoint
|
|
$8.41
|
|
$8.38
|
|
|
|
|
|
As of
7/25/22
|
|
As of
4/25/22
|
|
Key
Assumptions
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
Occupancy percentage in
North America as of December 31, 2022
|
|
95.2 %
|
|
95.8 %
|
|
95.2 %
|
|
95.8 %
|
|
Lease renewals and
re-leasing of space:
|
|
|
|
|
|
|
|
|
|
Rental rate
increases
|
|
30.0 %
|
|
35.0 %
|
|
30.0 %
|
|
35.0 %
|
|
Rental rate increases
(cash basis)
|
|
18.0 %
|
|
23.0 %
|
|
18.0 %
|
|
23.0 %
|
|
Same property
performance:
|
|
|
|
|
|
|
|
|
|
Net operating income
increase
|
|
6.0 %
|
|
8.0 %
|
|
5.9 %
|
|
7.9 %
|
|
Net operating income
increase (cash basis)
|
|
6.8 %
|
|
8.8 %
|
|
6.5 %
|
|
8.5 %
|
|
Straight-line rent
revenue(5)
|
|
$
144
|
|
$
154
|
|
$
154
|
|
$
164
|
|
General and
administrative expenses(4)
|
|
$
172
|
|
$
180
|
|
$
168
|
|
$
176
|
|
Capitalization of
interest
|
|
$
269
|
|
$
279
|
|
$
269
|
|
$
279
|
|
Interest
expense
|
|
$
90
|
|
$
100
|
|
$
90
|
|
$
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Key Credit
Metrics
|
|
As of
7/25/22
|
|
As of
4/25/22
|
Net debt and preferred
stock to Adjusted EBITDA – 4Q22 annualized
|
|
Less than or equal to
5.1x
|
|
Less than or equal to
5.1x
|
Fixed-charge coverage
ratio – 4Q22 annualized
|
|
Greater than or equal
to 5.1x
|
|
Greater than or equal
to 5.1x
|
|
|
(1)
|
Excludes unrealized
gains or losses after June 30, 2022 that are required to be
recognized in earnings and are excluded from funds from operations
per share, as adjusted.
|
(2)
|
Refer to "Funds from
operations and funds from operations, as adjusted, attributable to
Alexandria's common stockholders" in the "Definitions and
reconciliations" of our Supplemental Information for additional
details.
|
(3)
|
Refer to "Key capital
events" on page 3 of this Earnings Press Release for additional
details.
|
(4)
|
Relates to the
resignation of an executive officer in July 2022. General &
administrative expenses increased by $4 million, including $7
million related to the acceleration of stock compensation due to
the resignation of Stephen A. Richardson, our Co-Chief Executive
Officer, partially offset by compensation savings in 2H22. Refer to
"Subsequent event" on page 3 of this Earnings Press release for
additional information.
|
(5)
|
The $10 million
reduction in our guidance range for straight-line rent revenue
includes reductions attributable to the following items:
|
|
- Changes to our capital plan for 2022 as
highlighted in our updated guidance for key sources and uses of
capital on the previous page, including the following:
-
- Lower acquisitions with operating activities
in 2022 as well as the $350 million reduction in the midpoint of
our guidance range for acquisitions; and
- Higher dispositions compared to sales of
partial interest.
- Acceleration of $2 million contractual rental
payments due under one long-term lease in our Cambridge/Inner
Suburbs submarket.
- Early terminations of below-market
leases:
-
- Includes two spaces aggregating 141,649 RSF
in two markets, of which 51% has been re-leased at aggregate rental
rate increases of 114% and 140% (cash basis). We expect the
re-leased spaces to take occupancy by 3Q22.
|
Earnings Call Information and About the Company
June 30, 2022
We will host a conference call on Tuesday, July 26, 2022,
at 3:00 p.m. Eastern Time
("ET")/noon Pacific Time ("PT"),
which is open to the general public, to discuss our financial and
operating results for the second quarter ended June 30, 2022.
To participate in this conference call, dial (833) 366-1125 or
(412) 902-6738 shortly before 3:00 p.m.
ET/noon PT and ask the
operator to join the call for Alexandria Real Estate Equities, Inc.
The audio webcast can be accessed at www.are.com in the "For
Investors" section. A replay of the call will be available for a
limited time from 5:00 p.m.
ET/2:00 p.m. PT on Tuesday,
July 26, 2022. The replay number is (877) 344-7529 or (412)
317-0088, and the access code is 7939670.
Additionally, a copy of this Earnings Press Release and
Supplemental Information for the second quarter ended June 30,
2022 is available in the "For Investors" section of our website at
www.are.com or by following this link:
https://www.are.com/fs/2022q2.pdf.
For any questions, please contact Joel
S. Marcus, executive chairman and founder; Peter M. Moglia, co-chief executive officer and
co-chief investment officer; Stephen A.
Richardson, co-chief executive officer; Dean A. Shigenaga, president and chief financial
officer; Paula Schwartz, managing
director of Rx Communications Group, at (917) 633-7790; or
Sara M. Kabakoff, vice president –
communications, at (626) 578-0777.
About the Company
Alexandria Real Estate Equities, Inc. (NYSE:ARE), an S&P
500® urban office real estate investment trust ("REIT"),
is the first, longest-tenured, and pioneering owner, operator, and
developer uniquely focused on collaborative life science, agtech,
and technology campuses in AAA innovation cluster locations, with a
total market capitalization of $33.7
billion and an asset base in North
America of 74.1 million square feet ("SF") as of
June 30, 2022. The asset base in North America includes 41.1 million RSF of
operating properties and 5.9 million RSF of Class A properties
undergoing construction, 9.9 million RSF of near-term and
intermediate-term development and redevelopment projects, and 17.2
million SF of future development projects. Founded in 1994,
Alexandria pioneered this niche
and has since established a significant market presence in key
locations, including Greater
Boston, the San Francisco Bay
Area, New York City,
San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a longstanding and proven track
record of developing Class A properties clustered in urban life
science, agtech, and technology campuses that provide our
innovative tenants with highly dynamic and collaborative
environments that enhance their ability to successfully recruit and
retain world-class talent and inspire productivity, efficiency,
creativity, and success. Alexandria also provides strategic capital to
transformative life science, agtech, and technology companies
through our venture capital platform. We believe our unique
business model and diligent underwriting ensure a high-quality and
diverse tenant base that results in higher occupancy levels, longer
lease terms, higher rental income, higher returns, and greater
long-term asset value. For additional information on Alexandria, please visit www.are.com.
***********
This document includes "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Such forward-looking statements include, without limitation,
statements regarding our 2022 earnings per share attributable to
Alexandria's common stockholders –
diluted, 2022 funds from operations per share attributable to
Alexandria's common stockholders –
diluted, net operating income, and our projected sources and uses
of capital. You can identify the forward-looking statements by
their use of forward-looking words, such as "forecast," "guidance,"
"goals," "projects," "estimates," "anticipates," "believes,"
"expects," "intends," "may," "plans," "seeks," "should," "targets,"
or "will," or the negative of those words or similar words. These
forward-looking statements are based on our current expectations,
beliefs, projections, future plans and strategies, anticipated
events or trends, and similar expressions concerning matters that
are not historical facts, as well as a number of assumptions
concerning future events. There can be no assurance that actual
results will not be materially higher or lower than these
expectations. These statements are subject to risks, uncertainties,
assumptions, and other important factors that could cause actual
results to differ materially from the results discussed in the
forward-looking statements. Factors that might cause such a
difference include, without limitation, our failure to obtain
capital (debt, construction financing, and/or equity) or refinance
debt maturities, lower than expected yields, increased interest
rates and operating costs, adverse economic or real estate
developments in our markets, our failure to successfully place into
service and lease any properties undergoing development or
redevelopment and our existing space held for future development or
redevelopment (including new properties acquired for that purpose),
our failure to successfully operate or lease acquired properties,
decreased rental rates, increased vacancy rates or failure to renew
or replace expiring leases, defaults on or non-renewal of leases by
tenants, adverse general and local economic conditions, an
unfavorable capital market environment, decreased leasing activity
or lease renewals, failure to obtain LEED and other healthy
building certifications and efficiencies, and other risks and
uncertainties detailed in our filings with the Securities and
Exchange Commission ("SEC"). Accordingly, you are cautioned not to
place undue reliance on such forward-looking statements. All
forward-looking statements are made as of the date of this Earnings
Press Release and Supplemental Information, and unless otherwise
stated, we assume no obligation to update this information and
expressly disclaim any obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise. For more discussion relating to risks
and uncertainties that could cause actual results to differ
materially from those anticipated in our forward-looking
statements, and risks to our business in general, please refer to
our SEC filings, including our most recent annual report on Form
10-K and any subsequent quarterly reports on Form 10-Q.
Alexandria®,
Lighthouse Design® logo, Building the Future of
Life-Changing Innovation®, That's What's in Our
DNA®, At the Vanguard and Heart of the Life Science
Ecosystem™, Alexandria Center®, Alexandria Technology
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trademarks of Alexandria Real Estate Equities, Inc. All other
company names, trademarks, and logos referenced herein are the
property of their respective owners.
Consolidated
Statements of Operations
June 30, 2022
(Dollars in thousands, except per share amounts)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
6/30/22
|
|
3/31/22
|
|
12/31/21
|
|
9/30/21
|
|
6/30/21
|
|
6/30/22
|
|
6/30/21
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
rentals
|
|
$
640,959
|
|
$
612,554
|
|
$
574,656
|
|
$
546,527
|
|
$
508,371
|
|
$
1,253,513
|
|
$
987,066
|
Other
income
|
|
2,805
|
|
2,511
|
|
2,267
|
|
1,232
|
|
1,248
|
|
5,316
|
|
2,402
|
Total
revenues
|
|
643,764
|
|
615,065
|
|
576,923
|
|
547,759
|
|
509,619
|
|
1,258,829
|
|
989,468
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental
operations
|
|
196,284
|
|
181,328
|
|
175,717
|
|
165,995
|
|
143,955
|
|
377,612
|
|
281,843
|
General and
administrative
|
|
43,397
|
|
40,931
|
|
41,654
|
|
37,931
|
|
37,880
|
|
84,328
|
|
71,876
|
Interest
|
|
24,257
|
|
29,440
|
|
34,862
|
|
35,678
|
|
35,158
|
|
53,697
|
|
71,625
|
Depreciation and
amortization
|
|
242,078
|
|
240,659
|
|
239,254
|
|
210,842
|
|
190,052
|
|
482,737
|
|
370,965
|
Impairment of
real estate
|
|
—
|
|
—
|
|
—
|
|
42,620
|
|
4,926
|
|
—
|
|
10,055
|
Loss on early
extinguishment of debt
|
|
3,317
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,317
|
|
67,253
|
Total
expenses
|
|
509,333
|
|
492,358
|
|
491,487
|
|
493,066
|
|
411,971
|
|
1,001,691
|
|
873,617
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated real estate joint ventures
|
|
213
|
|
220
|
|
3,018
|
|
3,091
|
|
2,609
|
|
433
|
|
6,146
|
Investment (loss)
income
|
|
(39,481)
|
|
(240,319)
|
|
(112,884)
|
|
67,084
|
|
304,263
|
|
(279,800)
|
|
305,277
|
Gain (loss) on sales of
real estate
|
|
214,219
|
|
—
|
|
124,226
|
|
(435)
|
|
—
|
|
214,219
|
|
2,779
|
Net income
(loss)
|
|
309,382
|
|
(117,392)
|
|
99,796
|
|
124,433
|
|
404,520
|
|
191,990
|
|
430,053
|
Net income attributable
to noncontrolling interests
|
|
(37,168)
|
|
(32,177)
|
|
(24,901)
|
|
(21,286)
|
|
(19,436)
|
|
(69,345)
|
|
(36,848)
|
Net income (loss)
attributable to Alexandria Real Estate Equities, Inc.'s
stockholders
|
|
272,214
|
|
(149,569)
|
|
74,895
|
|
103,147
|
|
385,084
|
|
122,645
|
|
393,205
|
Net income attributable
to unvested restricted stock awards
|
|
(2,934)
|
|
(2,081)
|
|
(2,098)
|
|
(1,883)
|
|
(4,521)
|
|
(4,134)
|
|
(4,663)
|
Net income (loss)
attributable to Alexandria Real Estate Equities, Inc.'s
common stockholders
|
|
$
269,280
|
|
$ (151,650)
|
|
$
72,797
|
|
$
101,264
|
|
$
380,563
|
|
$
118,511
|
|
$
388,542
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share attributable to Alexandria Real Estate Equities,
Inc.'s common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.67
|
|
$
(0.96)
|
|
$
0.47
|
|
$
0.67
|
|
$
2.61
|
|
$
0.74
|
|
$
2.74
|
Diluted
|
|
$
1.67
|
|
$
(0.96)
|
|
$
0.47
|
|
$
0.67
|
|
$
2.61
|
|
$
0.74
|
|
$
2.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
of common stock outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
161,412
|
|
158,198
|
|
153,464
|
|
150,854
|
|
145,825
|
|
159,814
|
|
141,596
|
Diluted
|
|
161,412
|
|
158,198
|
|
154,307
|
|
151,561
|
|
146,058
|
|
159,814
|
|
141,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per
share of common stock
|
|
$
1.18
|
|
$
1.15
|
|
$
1.15
|
|
$
1.12
|
|
$
1.12
|
|
$
2.33
|
|
$
2.21
|
|
|
Consolidated Balance
Sheets
June 30, 2022
(In thousands)
|
|
|
6/30/22
|
|
3/31/22
|
|
12/31/21
|
|
9/30/21
|
|
6/30/21
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Investments in real
estate
|
|
$
27,952,931
|
|
$
27,100,009
|
|
$
24,980,669
|
|
$
23,071,514
|
|
$
21,692,385
|
Investments in
unconsolidated real estate joint ventures
|
|
37,587
|
|
38,456
|
|
38,483
|
|
321,737
|
|
323,622
|
Cash and cash
equivalents
|
|
420,258
|
|
775,060
|
|
361,348
|
|
325,872
|
|
323,876
|
Restricted
cash
|
|
97,404
|
|
95,106
|
|
53,879
|
|
42,182
|
|
33,697
|
Tenant
receivables
|
|
7,069
|
|
7,570
|
|
7,379
|
|
7,749
|
|
6,710
|
Deferred
rent
|
|
905,699
|
|
881,743
|
|
839,335
|
|
816,219
|
|
781,600
|
Deferred leasing
costs
|
|
498,434
|
|
484,184
|
|
402,898
|
|
329,952
|
|
321,005
|
Investments
|
|
1,657,461
|
|
1,661,101
|
|
1,876,564
|
|
2,046,878
|
|
1,999,283
|
Other assets
|
|
1,667,210
|
|
1,801,027
|
|
1,658,818
|
|
1,596,615
|
|
1,536,672
|
Total assets
|
|
$
33,244,053
|
|
$
32,844,256
|
|
$
30,219,373
|
|
$
28,558,718
|
|
$
27,018,850
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities,
Noncontrolling Interests, and Equity
|
|
|
|
|
|
|
|
|
|
|
Secured notes
payable
|
|
$
24,986
|
|
$
208,910
|
|
$
205,198
|
|
$
198,758
|
|
$
227,984
|
Unsecured senior notes
payable
|
|
10,096,462
|
|
10,094,337
|
|
8,316,678
|
|
8,314,851
|
|
8,313,025
|
Unsecured senior line
of credit and commercial paper
|
|
149,958
|
|
—
|
|
269,990
|
|
749,978
|
|
299,990
|
Accounts payable,
accrued expenses, and other liabilities
|
|
2,317,940
|
|
2,172,692
|
|
2,210,410
|
|
2,149,450
|
|
1,825,387
|
Dividends
payable
|
|
192,571
|
|
187,701
|
|
183,847
|
|
173,560
|
|
170,647
|
Total
liabilities
|
|
12,781,917
|
|
12,663,640
|
|
11,186,123
|
|
11,586,597
|
|
10,837,033
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable
noncontrolling interests
|
|
9,612
|
|
9,612
|
|
9,612
|
|
11,681
|
|
11,567
|
|
|
|
|
|
|
|
|
|
|
|
Alexandria Real Estate
Equities, Inc.'s stockholders' equity:
|
|
|
|
|
|
|
|
|
|
|
Common
stock
|
|
1,615
|
|
1,614
|
|
1,580
|
|
1,532
|
|
1,507
|
Additional paid-in
capital
|
|
17,149,571
|
|
16,934,094
|
|
16,195,256
|
|
14,727,735
|
|
14,194,023
|
Accumulated other
comprehensive loss
|
|
(11,851)
|
|
(5,727)
|
|
(7,294)
|
|
(6,029)
|
|
(4,508)
|
Alexandria Real Estate
Equities, Inc.'s stockholders' equity
|
|
17,139,335
|
|
16,929,981
|
|
16,189,542
|
|
14,723,238
|
|
14,191,022
|
Noncontrolling
interests
|
|
3,313,189
|
|
3,241,023
|
|
2,834,096
|
|
2,237,202
|
|
1,979,228
|
Total equity
|
|
20,452,524
|
|
20,171,004
|
|
19,023,638
|
|
16,960,440
|
|
16,170,250
|
Total liabilities,
noncontrolling interests, and equity
|
|
$
33,244,053
|
|
$
32,844,256
|
|
$
30,219,373
|
|
$
28,558,718
|
|
$
27,018,850
|
|
|
Funds From
Operations and Funds From Operations per Share
June 30, 2022
(In thousands)
|
|
The following table
presents a reconciliation of net income (loss) attributable to
Alexandria's common stockholders, the most directly comparable
financial measure presented in accordance with U.S. generally
accepted accounting principles ("GAAP"), including our share of
amounts from consolidated and unconsolidated real estate joint
ventures, to funds from operations attributable to Alexandria's
common stockholders – diluted, and funds from operations
attributable to Alexandria's common stockholders – diluted, as
adjusted, for the periods below:
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
6/30/22
|
|
3/31/22
|
|
12/31/21
|
|
9/30/21
|
|
6/30/21
|
|
6/30/22
|
|
6/30/21
|
Net income (loss)
attributable to Alexandria's common stockholders
|
|
$
269,280
|
|
$
(151,650)
|
|
$ 72,797
|
|
$
101,264
|
|
$
380,563
|
|
$
118,511
|
|
$
388,542
|
Depreciation and
amortization of real estate assets
|
|
238,565
|
|
237,160
|
|
234,979
|
|
205,436
|
|
186,498
|
|
475,725
|
|
364,218
|
Noncontrolling share
of depreciation and amortization from consolidated real
estate JVs
|
|
(26,418)
|
|
(23,681)
|
|
(21,265)
|
|
(17,871)
|
|
(16,301)
|
|
(50,099)
|
|
(31,744)
|
Our share of
depreciation and amortization from unconsolidated real estate
JVs
|
|
934
|
|
955
|
|
3,058
|
|
3,465
|
|
4,135
|
|
1,889
|
|
7,211
|
(Gain) loss on sales
of real estate
|
|
(214,219)
|
|
—
|
|
(124,226)
|
|
435
|
|
—
|
|
(214,219)
|
|
(2,779)
|
Impairment of real
estate – rental properties
|
|
—
|
|
—
|
|
—
|
|
18,602
|
|
1,754
|
|
—
|
|
6,883
|
Allocation to unvested
restricted stock awards
|
|
—
|
|
—
|
|
—
|
|
(1,472)
|
|
(2,191)
|
|
—
|
|
(4,427)
|
Funds from
operations attributable to Alexandria's common stockholders –
diluted(1)
|
|
268,142
|
|
62,784
|
|
165,343
|
|
309,859
|
|
554,458
|
|
331,807
|
|
727,904
|
Unrealized losses
(gains) on non-real estate investments
|
|
68,128
|
|
263,433
|
|
139,716
|
|
14,432
|
|
(244,031)
|
|
331,561
|
|
(197,780)
|
Significant realized
gains on non-real estate investments
|
|
—
|
|
—
|
|
—
|
|
(52,427)
|
|
(34,773)
|
|
—
|
|
(57,692)
|
Impairment of real
estate
|
|
—
|
|
—
|
|
—
|
|
24,018
|
|
3,172
|
|
—
|
|
3,172
|
Loss on early
extinguishment of debt
|
|
3,317
|
|
—
|
|
—
|
|
—
|
|
—
|
|
3,317
|
|
67,253
|
Allocation to unvested
restricted stock awards
|
|
(778)
|
|
(1,604)
|
|
(1,432)
|
|
149
|
|
3,428
|
|
(3,264)
|
|
2,382
|
Funds from
operations attributable to Alexandria's common stockholders –
diluted, as adjusted
|
|
$
338,809
|
|
$
324,613
|
|
$
303,627
|
|
$
296,031
|
|
$
282,254
|
|
$
663,421
|
|
$
545,239
|
|
|
(1)
|
Calculated in
accordance with standards established by the Nareit Board of
Governors.
|
|
|
|
|
Funds From
Operations and Funds From Operations per Share (continued)
June 30, 2022
(In thousands, except per share amounts)
|
|
The following table
presents a reconciliation of net income (loss) per share
attributable to Alexandria's common stockholders, the most directly
comparable financial measure presented in accordance with GAAP,
including our share of amounts from consolidated and unconsolidated
real estate joint ventures, to funds from operations per share
attributable to Alexandria's common stockholders – diluted, and
funds from operations per share attributable to Alexandria's common
stockholders – diluted, as adjusted, for the periods below. Per
share amounts may not add due to rounding.
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
6/30/22
|
|
3/31/22
|
|
12/31/21
|
|
9/30/21
|
|
6/30/21
|
|
6/30/22
|
|
6/30/21
|
Net income (loss)
per share attributable to Alexandria's common
stockholders – diluted
|
|
$
1.67
|
|
$
(0.96)
|
|
$
0.47
|
|
$
0.67
|
|
$
2.61
|
|
$
0.74
|
|
$
2.74
|
Depreciation and
amortization of real estate assets
|
|
1.32
|
|
1.36
|
|
1.40
|
|
1.26
|
|
1.19
|
|
2.68
|
|
2.39
|
Gain on sales of real
estate
|
|
(1.33)
|
|
—
|
|
(0.80)
|
|
—
|
|
—
|
|
(1.34)
|
|
(0.02)
|
Impairment of real
estate – rental properties
|
|
—
|
|
—
|
|
—
|
|
0.12
|
|
0.01
|
|
—
|
|
0.05
|
Allocation to unvested
restricted stock awards
|
|
—
|
|
—
|
|
—
|
|
(0.01)
|
|
(0.01)
|
|
—
|
|
(0.03)
|
Funds from
operations per share attributable to Alexandria's common
stockholders – diluted
|
|
1.66
|
|
0.40
|
|
1.07
|
|
2.04
|
|
3.80
|
|
2.08
|
|
5.13
|
Unrealized losses
(gains) on non-real estate investments
|
|
0.42
|
|
1.67
|
|
0.91
|
|
0.10
|
|
(1.67)
|
|
2.07
|
|
(1.39)
|
Significant realized
gains on non-real estate investments
|
|
—
|
|
—
|
|
—
|
|
(0.35)
|
|
(0.24)
|
|
—
|
|
(0.41)
|
Impairment of real
estate
|
|
—
|
|
—
|
|
—
|
|
0.16
|
|
0.02
|
|
—
|
|
0.02
|
Loss on early
extinguishment of debt
|
|
0.02
|
|
—
|
|
—
|
|
—
|
|
—
|
|
0.02
|
|
0.47
|
Allocation to unvested
restricted stock awards
|
|
—
|
|
(0.02)
|
|
(0.01)
|
|
—
|
|
0.02
|
|
(0.02)
|
|
0.02
|
Funds from
operations per share attributable to Alexandria's common
stockholders – diluted, as
adjusted
|
|
$
2.10
|
|
$
2.05
|
|
$
1.97
|
|
$
1.95
|
|
$
1.93
|
|
$
4.15
|
|
$
3.84
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
of common stock outstanding for calculation of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share –
diluted
|
|
161,412
|
|
158,198
|
|
154,307
|
|
151,561
|
|
146,058
|
|
159,814
|
|
141,896
|
Funds from operations,
diluted, per share
|
|
161,412
|
|
158,209
|
|
154,307
|
|
151,561
|
|
146,058
|
|
159,814
|
|
141,896
|
Funds from operations,
diluted, as adjusted, per share
|
|
161,412
|
|
158,209
|
|
154,307
|
|
151,561
|
|
146,058
|
|
159,814
|
|
141,896
|
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SOURCE Alexandria Real Estate Equities, Inc.