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MAC > SEC Filings for MAC > Form 8-K/A on 28-Mar-2013All Recent SEC Filings

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Form 8-K/A for MACERICH CO


28-Mar-2013

Financial Statements and Exhibits


ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

Listed below are the financial statements, pro forma financial information and exhibits furnished as part of this report:

(a) Financial statements under Rule 3-14 of Regulation S-X

Independent Auditors' Report

Statements of Revenues and Certain Expenses for the Nine Months Ended September 30, 2012 (Unaudited) and the Year Ended December 31, 2011

Notes to Statements of Revenues and Certain Expenses for the Nine Months Ended September 30, 2012 (Unaudited) and the Year Ended December 31, 2011

(b) Pro Forma Financial Information (Unaudited)

Pro Forma Consolidated Balance Sheet as of September 30, 2012

Notes to Pro Forma Consolidated Balance Sheet as of September 30, 2012

Pro Forma Consolidated Statement of Operations for the Nine Months Ended September 30, 2012

Notes to Pro Forma Consolidated Statement of Operations for the Nine Months Ended September 30, 2012

Pro Forma Consolidated Statement of Operations for the Year Ended December 31, 2011

Notes to Pro Forma Consolidated Statement of Operations for the Year Ended December 31, 2011

(d) Exhibits.

23.1 Consent of KPMG LLP, dated March 28, 2013


Independent Auditors' Report

The Board of Directors of

The Macerich Company:

We have audited the accompanying statement of revenues and certain expenses (Historical Summary) of Green Acres Mall (the Property) for the year ended December 31, 2011. This Historical Summary is the responsibility of the Property's management. Our responsibility is to express an opinion on this Historical Summary based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Historical Summary is free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Property's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the Historical Summary, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the Historical Summary. We believe that our audit provides a reasonable basis for our opinion.

The accompanying Historical Summary was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission as described in note 1. The presentation is not intended to be a complete presentation of the Property's revenues and certain expenses.

In our opinion, the Historical Summary referred to above presents fairly, in all material respects, the revenues and certain expenses described in note 1 of Green Acres Mall for the year ended December 31, 2011, in conformity with U.S. generally accepted accounting principles.

/s/ KPMG LLP

Los Angeles, California

March 28, 2013


                                GREEN ACRES MALL



                  STATEMENTS OF REVENUES AND CERTAIN EXPENSES



                             (Dollars in thousands)



                                                      For the Nine Months
                                                      Ended September 30,
                                                             2012              For the Year Ended
                                                          (Unaudited)          December 31, 2011
Revenues:
Minimum rents                                        $              25,062    $             34,384
Percentage rents                                                         -                     471
Tenant recoveries                                                   21,070                  24,764
Other                                                                    7                      16
Total revenues                                                      46,139                  59,635
Certain expenses:
Operations and maintenance                                           4,142                   7,784
Real estate taxes                                                   16,023                  20,393
Insurance                                                              157                     211
Utilities                                                            1,278                   2,101
Security                                                             1,032                   1,415
Total certain expenses                                              22,632                  31,904
Revenues in excess of certain expenses               $              23,507    $             27,731

The accompanying notes are an integral part of these statements of revenues and certain expenses.


GREEN ACRES MALL

NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES

NINE MONTHS ENDED SEPTEMBER 30, 2012 (UNAUDITED) AND THE YEAR ENDED DECEMBER 31,

(Dollars in thousands)

1. Summary of Significant Accounting Policies:

Basis of Presentation:

The accompanying statements of revenues and certain expenses relate to the operations of Green Acres Mall, an 1,800,000 square foot super regional shopping center in Valley Stream, New York that was purchased by The Macerich Company on January 24, 2013.

The accompanying statements of revenues and certain expenses have been prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission and, accordingly, are not representative of the actual results of operations of Green Acres Mall for the nine months ended September 30, 2012 and the year ended December 31, 2011 due to the exclusion of the following expenses, which may not be comparable to the proposed future operations of the property:

Depreciation and amortization,

Management fees, and

Mortgage interest expense since the center was refinanced on the date of acquisition.

Revenues:

Minimum rental revenues are recognized on a straight-line basis over the terms of the related leases. Percentage rents are recognized and accrued when tenants' specified sales targets have been met.

Estimated recoveries from certain tenants for their pro rata share of real estate taxes, insurance and other shopping center operating expenses are recognized as revenues in the period the applicable expenses are incurred. Other tenants pay a fixed rate and these tenant recoveries are recognized as revenues on a straight-line basis over the terms of the related leases.

Management Estimates:

Management has made a number of estimates and assumptions relating to the reporting and disclosure of revenues and certain expenses during the reporting period to prepare the statements of revenues and certain expenses in conformity with U.S. generally accepted accounting principles. Actual results could differ from these estimates.

Unaudited Interim Statement:

The statement of revenues and certain expenses for the nine months ended September 30, 2012 is unaudited. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the statement of revenues and certain expenses for the interim period have been made.


2. Future Rental Revenues:

Under existing non-cancelable operating lease agreements, tenants are committed to pay the following minimum rental payments to Green Acres Mall:

Year Ending December 31,

2012                       $  27,935
2013                          26,190
2014                          22,454
2015                          20,689
2016                          19,040
Thereafter                   139,638
                           $ 255,946

3. Commitments and Contingencies:

Green Acres Mall is subject to a non-cancelable operating ground lease. The lease expires on May 28, 2018, subject to options to extend the term of the lease. Minimum future rental payments required under the lease, including amounts expected to be incurred during the extension periods, are as follows:

Year Ending December 31,

2012                       $  1,183
2013                          1,119
2014                          1,056
2015                          1,056
2016                          1,056
Thereafter                   28,163
                           $ 33,633

4. Subsequent Events:

The management of Green Acres Mall evaluated subsequent events through March 28, 2013, the date that these statements of revenues and certain expenses were issued.


The Macerich Company (the "Company")

Pro Forma Consolidated Financial Information (Unaudited)

The following unaudited pro forma consolidated financial information has been prepared to give effect to the Company's acquisition of Green Acres Mall. The Company acquired Green Acres Mall on January 24, 2013 for a purchase price of $500.0 million. The purchase price was funded by the placement of a $325.0 million mortgage note on the property and borrowings under the Company's line of credit.

The pro forma consolidated balance sheet has been presented as if the the acquisition occurred on September 30, 2012 and the pro forma statements of operations have been presented as if the acquisition had occurred on January 1, 2011.

This pro forma consolidated financial information should be read in conjunction with the Company's consolidated financial statements included in the Company's Form 10-K for the year ended December 31, 2011, the Company's Form 10-Q for the quarterly period ended September 30, 2012, as filed with the Securities and Exchange Commission, and the statements of revenues and certain expenses of Green Acres Mall and related notes thereto included elsewhere in this filing.

The purchase allocation adjustments made in connection with the unaudited pro forma consolidated financial statements are based on the information available at this time. Subsequent adjustments to the allocation may be made based on additional information.

The pro forma consolidated financial statements do not purport to represent the Company's financial position or results of operation that would actually have occurred assuming the acquisition of Green Acres Mall along with the related financing transactions had all occurred on January 1, 2011; nor do they purport to project the Company's financial position or results of operations as of any future date or for any future period.


                              THE MACERICH COMPANY



                PRO FORMA CONSOLIDATED BALANCE SHEET (UNAUDITED)



                            AS OF SEPTEMBER 30, 2012



                             (Dollars in thousands)



                                          The Company                                  Pro Forma
                                              (a)          Pro Forma Adjustments         Total
ASSETS:
Property, net                             $  5,942,141    $               476,264 (b) $ 6,418,405
Cash and cash equivalents                       76,553                          -          76,553
Restricted cash                                 61,743                      1,563 (c)      63,306
Marketable securities                           24,209                          -          24,209
Tenant and other receivables, net              108,329                          -         108,329
Deferred charges and other assets, net         359,228                     63,841 (b)
                                                                            4,493 (c)     427,562
Loans to unconsolidated joint ventures           3,334                          -           3,334
Due from affiliates                              7,595                          -           7,595
Investments in unconsolidated joint
ventures                                     1,026,724                          -       1,026,724
Total assets                              $  7,609,856    $               546,161     $ 8,156,017
LIABILITIES AND EQUITY:
Mortgage notes payable:
Related parties                           $    275,871    $                     -     $   275,871
Others                                       3,109,402                    325,000 (c)   3,434,402
Total                                        3,385,273                    325,000       3,710,273
Bank and other notes payable                   404,239                    177,723 (e)     581,962
Accounts payable and accrued expenses           74,754                          -          74,754
Other accrued liabilities                      278,198                     40,105 (b)
                                                                            3,333 (d)     321,636
Distributions in excess of investments
in unconsolidated joint ventures                86,666                          -          86,666
Co-venture obligation                           95,018                          -          95,018
Total liabilities                            4,324,148                    546,161       4,870,309
Commitments and contingencies
Equity:
Stockholders' equity:
Common stock                                     1,363                          -           1,363
Additional paid-in capital                   3,671,351                          -       3,671,351
Accumulated deficit                           (734,684 )                        -        (734,684 )
Total stockholders' equity                   2,938,030                          -       2,938,030
Noncontrolling interests                       347,678                          -         347,678
Total equity                                 3,285,708                          -       3,285,708
Total liabilities and equity              $  7,609,856    $               546,161     $ 8,156,017

The accompanying notes are an integral part of this pro forma consolidated balance sheet (unaudited).


THE MACERICH COMPANY

NOTES TO PRO FORMA CONSOLIDATED BALANCE SHEET (UNAUDITED)

AS OF SEPTEMBER 30, 2012

(Dollars in thousands)

(a) This information represents the Company's historical consolidated balance sheet as of September 30, 2012, which was included in the Company's previously filed Quarterly Report on Form 10-Q for the quarter ended September 30, 2012.

(b) Includes the pro forma effect of the Company's acquisition of Green Acres Mall. The purchase price was allocated to assets acquired and liabilities assumed based on fair values as follows:

Property, net                            $ 476,264
Deferred charges and other assets, net      63,841
Total assets acquired                      540,105

Other accrued liabilities                   40,105
Total liabilities assumed                   40,105
Fair value of assets acquired, net       $ 500,000

(c) Represents the pro forma effect of the Company's placement of a $325,000 mortgage note payable on the property. The mortgage note payable bears interest at an effective interest rate of 3.62% and matures on February 3, 2021. In accordance with the loan agreement, the Company has established a restricted cash account for $1,563 at the date of acquisition. The Company incurred origination costs of $4,493 in placement of this loan which are included in deferred charges and other assets, net, in the accompanying pro forma consolidated balance sheet.

(d) Includes certain pro ration adjustments related to the acquisition.

(e) Represents additional borrowings under the Company's line of credit to fund the acquisition.


                              THE MACERICH COMPANY



           PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)



                  FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012



                (Dollars in thousands, except per share amounts)



                                     The Company      Green Acres       Pro Forma          Pro Forma
                                         (a)           Mall (b)        Adjustments           Total
Revenues:
Minimum rents                       $     356,551    $      25,062    $       1,259 (c)  $     382,872
Percentage rents                           11,938                -                -             11,938
Tenant recoveries                         197,924           21,070                -            218,994
Management Companies                       30,730                -                -             30,730
Other                                      33,017                7                -             33,024
Total revenues                            630,160           46,139            1,259            677,558
Expenses:
Shopping center and operating
expenses                                  198,258           22,632              (27 )(d)       220,863
Management Companies' operating
expenses                                   66,953                -                -             66,953
REIT general and administrative
expenses                                   15,235                -                -             15,235
Depreciation and amortization             217,548                -           13,619 (e)        231,167
                                          497,994           22,632           13,592            534,218
Interest expense:
Related parties                            11,588                -                -             11,588
Other                                     116,855                -           13,217 (f)        130,072
                                          128,443                -           13,217            141,660
Total expenses                            626,437           22,632           26,809            675,878
Equity in income of
unconsolidated joint ventures              68,624                -                -             68,624
Co-venture expense                         (4,462 )              -                -             (4,462 )
Income tax benefit                          2,159                -                -              2,159
Gain on remeasurement, sale or
write down of assets, net                  40,603                -                -             40,603
Income from continuing
operations                                110,647           23,507          (25,550 )          108,604
Less income from continuing
operations attributable to
noncontrolling interests                   11,838                -             (157 )           11,681
Income from continuing
operations attributable to the
Company                             $      98,809    $      23,507    $     (25,393 )    $      96,923
Earnings per common share
attributable to Company:
Income (loss) from continuing
operations - basic                  $        0.74                     $       (0.02 )    $        0.72
Income (loss) from continuing
operations - diluted                $        0.74                     $       (0.02 )    $        0.72
Weighted average number of
common shares outstanding:
Basic                                 133,091,000                                          133,091,000
Diluted                               133,187,000                                          133,187,000

The accompanying notes are an integral part of this pro forma consolidated statement of operations (unaudited).


THE MACERICH COMPANY

NOTES TO PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012

(Dollars in thousands)

(a) This information represents the Company's historical consolidated statement of operations for the nine months ended September 30, 2012, which was included in the Company's previously filed Quarterly Report on Form 10-Q for the quarter ended September 30, 2012.

(b) This information represents revenues and certain expenses of Green Acres Mall for the nine months ended September 30, 2012, which was included in this Current Report on Form 8-K/A.

(c) Represents the pro forma amortization of above and below market leases based on the purchase price allocation of Green Acres Mall, which is based on the information available at this time. Subsequent adjustments to the allocation may be made based on additional information.

(d) Represents the pro forma amortization of an above market ground lease based on the purchase price allocation of Green Acres Mall, which is based on the information available at this time. Subsequent adjustments to the allocation may be made based on additional information.

(e) Represents the pro forma depreciation and amortization expense based on the purchase price allocation of Green Acres Mall, which is based on the information available at this time. Subsequent adjustments to the allocation may be made based on additional information.

(f) Represents interest expense on the $325,000 mortgage loan placed on the property and interest expense on the additional borrowings on the Company's line of credit.


                              THE MACERICH COMPANY



           PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)



                      FOR THE YEAR ENDED DECEMBER 31, 2011



                (Dollars in thousands, except per share amounts)



                                      The Company      Green Acres       Pro Forma          Pro Forma
                                          (a)           Mall (b)        Adjustments           Total
Revenues:
Minimum rents                        $     429,007    $      34,384    $       1,710 (c)  $     465,101
Percentage rents                            19,175              471                -             19,646
Tenant recoveries                          241,776           24,764                -            266,540
Management Companies                        40,404                -                -             40,404
Other                                       33,009               16                -             33,025
Total revenues                             763,371           59,635            1,710            824,716
Expenses:
Shopping center and operating
expenses                                   242,298           31,904              (36 )(d)       274,166
Management Companies' operating
expenses                                    86,587                -                -             86,587
REIT general and administrative
expenses                                    21,113                -                -             21,113
Depreciation and amortization              252,075                -           20,646 (e)        272,721
                                           602,073           31,904           20,610            654,587
Interest expense:
Related parties                             16,743                -                -             16,743
Other                                      162,965                -           16,585 (f)        179,550
                                           179,708                -           16,585            196,293
Loss on early extinguishment of
debt, net                                   10,588                -                -             10,588
Total expenses                             792,369           31,904           37,195            861,468
Equity in income of
unconsolidated joint ventures              294,677                -                -            294,677
Co-venture expense                          (5,806 )              -                -             (5,806 )
Income tax benefit                           6,110                -                -              6,110
Loss on remeasurement, sale or
write down of assets, net                  (22,037 )              -                -            (22,037 )
Income from continuing operations          243,946           27,731          (35,485 )          236,192
Less income from continuing
operations attributable to
noncontrolling interests                    14,965                -             (615 )           14,350
Income from continuing operations
attributable to the Company          $     228,981    $      27,731    $     (34,870 )    $     221,842
Earnings per common share
attributable to Company:
Income (loss) from continuing
operations - basic                   $        1.70                     $       (0.07 )    $        1.63
Income (loss) from continuing
operations - diluted                 $        1.70                     $       (0.07 )    $        1.63
Weighted average number of common
shares outstanding:
Basic                                  131,628,000                                          131,628,000
Diluted                                131,628,000                                          131,628,000

The accompanying notes are an integral part of this pro forma consolidated statement of operations (unaudited).


THE MACERICH COMPANY

NOTES TO PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)

FOR THE YEAR ENDED DECEMBER 31, 2011

(Dollars in thousands)

(a) This information represents the Company's historical consolidated statement of operations for the year ended December 31, 2011, which was included in the Company's previously filed Annual Report on Form 10-K for the year ended December 31, 2011. The presentation includes the reclassifications of revenues and expenses of $27,879 and $42,352, respectively, to discontinued operations related to dispositions subsequent to the filings of the Annual Report on Form 10-K for the year ended December 31, 2011.

(b) This information represents revenues and certain expenses of Green Acres Mall for the year ended December 31, 2011, included in this Current Report on Form 8-K/A.

(c) Represents the pro forma amortization of above and below market leases based on the purchase price allocation of Green Acres Mall, which is based on the information available at this time. Subsequent adjustments to the . . .

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