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Franklin Street Properties Corp. Announces Third Quarter 2008 Results WAKEFIELD, MA--(MARKET WIRE)--Nov 4, 2008 -- Franklin Street Properties Corp. (the
"Company" or "FSP") (NYSE Alternext U.S.: FSP) (AMEX:FSP - News),
an investment
firm specializing in real estate, announced today Net Income
of $7.4
million and Earnings Per Share (EPS) of $0.11 for the three
months ended
September 30, 2008. The Company also announced Funds From
Operations (FFO)
of $17.1 million or $0.24 per share for the third quarter
and provided an
update on other activities. The Company evaluates its performance based on Net Income, EPS, FFO, Gains on Sales (GOS) and FFO+GOS, and believes each is an important measure. A reconciliation of Net Income to FFO and FFO+GOS, which are non-GAAP financial measures, is provided later on in this press release.
(in 000's
except per Three Months Ended Nine Months Ended
share data) September 30, September 30,
----------------------------- -----------------------------
Increase Increase
2008 2007 (Decrease) 2008 2007 (Decrease)
--------- --------- -------- --------- --------- ---------
Net Income $ 7,419 $ 9,486 $ (2,067) $ 25,340 $ 51,694 $(26,354)
========= ========= ======== ========= ========= ========
FFO $ 17,084 $ 16,922 $ 162 $ 53,005 $ 56,477 $ (3,472)
GOS - 1,942 (1,942) - 23,532 (23,532)
--------- --------- -------- --------- --------- --------
FFO+GOS $ 17,084 $ 18,864 $ (1,780) $ 53,005 $ 80,009 $(27,004)
========= ========= ======== ========= ========= ========
Per Share Data:
EPS $ 0.11 $ 0.13 $ (0.03) $ 0.36 $ 0.73 $ (0.38)
FFO $ 0.24 $ 0.24 $ 0.00 $ 0.75 $ 0.80 $ (0.05)
GOS $ - $ 0.03 $ (0.03) $ - $ 0.33 $ (0.33)
FFO+GOS $ 0.24 $ 0.27 $ (0.02) $ 0.75 $ 1.13 $ (0.38)
Weighted ave
shares
(diluted) 70,481 70,596 (115) 70,481 70,709 (228)
--------- --------- -------- --------- --------- --------
Comparing results for the third quarter of 2008 to 2007, Net Income and EPS decreased $2.1 million or $0.03 per share, and FFO increased $0.2 million but was flat on a per share basis. There was no GOS in the third quarter of 2008 compared to $1.9 million, or $0.03 per share, in the third quarter of 2007. Comparing results for the third quarter of 2008 to 2007, the FFO increase was primarily a result of increases in real estate FFO of $0.6 million, which was partially offset by a decrease in FFO from investment banking of $0.4 million. Primarily as a result of these changes, FFO+GOS decreased $1.8 million or $0.02 per share comparing the third quarter of 2008 to 2007. Comparing results for the nine months of 2008 to 2007, Net Income and EPS decreased $26.4 million or $0.38 per share, and FFO decreased $3.5 million or $0.05 per share. There was no GOS for the nine months of 2008 compared to $23.5 million or $0.33 per share in the nine months of 2007. Comparing results for the nine months of 2008 to 2007, the FFO decrease was primarily a result of a decrease in FFO from investment banking of $4.8 million, which was partially offset by increases in real estate FFO of $1.3 million. The FFO decrease from investment banking was primarily because of lower sales of securities by our investment bank, which decreased $61.8 million to $57.4 million for the nine months of 2008 compared to $119.2 million in the nine months of 2007. Revenue from our investment bank is primarily based on the value of these securities sales. As a result of these changes, FFO+GOS decreased $27.0 million or $0.38 per share comparing the nine months of 2008 to 2007. George J. Carter, President and CEO, commented as follows: "For the third quarter of 2008, FSP's profits as represented by FFO+GOS totaled approximately $17.1 million or $0.24 per share. Dividend distributions declared for the third quarter of 2008, which are payable on November 20, 2008, totaled approximately $13.4 million or $0.19 per share. "Significant portions of our real estate investment business are transactional. Beginning in the third quarter of 2007, those transactional businesses became materially impacted by external financial, mortgage/debt and investment market conditions that have arisen from the 'credit crunch.' FSP has certain properties in its portfolio that we may contemplate selling but have not put up for sale because of these market conditions. Consequently, the third quarter of 2008 produced no GOS profit contribution. Changes in mortgage loan availability and changes in the cost of those loans continue to restrict many potential sales of commercial office buildings around the country. Rather than sell in this negative environment, FSP continues to postpone consideration of the sale of some properties until a more attractive environment establishes itself, particularly within the mortgage/debt markets. A time frame for improvement in these markets is hard to predict, especially with the uncertainty of how significant an impact the current financial market turmoil will have on broader U.S. economic activity. We are constantly evaluating property disposition opportunities, as well as potential new property acquisition opportunities that may present themselves at attractive prices. "Additionally as a result of the turmoil in the financial, mortgage/debt and investment markets, the investor appetite for our real estate private placement business has suffered and continues to negatively affect our Investment Banking equity-raising efforts. During the third quarter of 2008, we raised $4.8 million of equity capital, compared with $49.9 million in the second quarter of 2008 and $2.7 million in the first quarter of 2008. Concern and uncertainty continues to surround the potential impact on commercial real estate emanating from the financial credit crisis and has caused a 'wait-and-see' attitude to prevail among many of our established investor clients. We anticipate business in this area to remain very volatile quarter-to-quarter as long as broader investment market activity and financial events continue to meaningfully sway investor confidence and sentiment. "While profits continued to suffer in the third quarter of 2008 from our transactional businesses, which were negatively impacted by turmoil in the broader capital markets, our real estate portfolio of 27 properties maintained its overall 93% occupancy and provided steady rental income. FFO for the third quarter of 2008 was $0.24 per share, all of which came from real estate operations. "On October 15, 2008, FSP used its balance sheet strength to obtain a $75 million unsecured term loan. The loan was provided by three banks that are participants in FSP's existing $250 million revolving line of credit facility. The purpose for the loan is to increase capital to take advantage of property acquisition opportunities that are beginning to present themselves at attractive prices as a result of the current distress surrounding some aspects of the broader commercial real estate markets. "As the capital markets and U.S. economy work through the current financial/credit crisis, we will continue to pursue additional commercial property investment opportunities. It will be FSP's objective to continue to grow its property portfolio and rental income business during this period of liquidity-constrained capital markets by using its balance sheet strength to help finance and fund new acquisitions. We continue to be very optimistic about FSP's position in the current commercial real estate investment market and the opportunities that are presenting themselves to acquire commercial properties at better pricing and value metrics than we have seen in the last several years." Dividend Announcement On October 17, 2008, the Company announced that its Board of Directors declared a regularly quarterly dividend for the three months ended September 30, 2008 of $0.19 per share of common stock payable on November 20, 2008 to stockholders of record on October 31, 2008. Real Estate Update Supplementary Schedules D & E provide property information for our continuing real estate portfolio of 27 properties and for two non-consolidated REITs that we have interests in as of September 30, 2008. The Company is in the process of compiling an expanded supplemental information package that will provide stockholders and the financial community with additional operating and financial data. The Company expects to file this supplemental information package with the SEC and to post it to its website at www.franklinstreetproperties.com on or before Friday, November 7, 2008. A reconciliation of Net Income to FFO and FFO+GOS is shown below and definitions of FFO and FFO+GOS are provided on Supplementary Schedule H. We believe FFO is used broadly throughout the real estate investment trust (REIT) industry as a measurement of performance and is generally calculated in a similar manner to our calculation. We also believe that FFO+GOS is an important measure as it considers investment performance.
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
(In thousands, except per share
amounts) 2008 2007 2008 2007
-------- -------- -------- --------
Net income $ 7,419 $ 9,486 $ 25,340 $ 51,694
(Gain) Loss on sale of properties - (1,942) - (23,532)
GAAP (income) loss from
non-consolidated REITs (680) (105) (2,167) 620
Distributions from
non-consolidated REITs 1,561 476 3,838 1,199
Depreciation of real estate &
intangible amortization 8,784 9,007 25,994 26,496
-------- -------- -------- --------
Funds From Operations (FFO) 17,084 16,922 53,005 56,477
Plus gains on sales of
properties (GOS) - 1,942 - 23,532
-------- -------- -------- --------
FFO+GOS $ 17,084 $ 18,864 $ 53,005 $ 80,009
======== ======== ======== ========
Per Share Data
EPS $ 0.11 $ 0.13 $ 0.36 $ 0.73
FFO $ 0.24 $ 0.24 $ 0.75 $ 0.80
GOS $ - $ 0.03 $ - $ 0.33
FFO+GOS $ 0.24 $ 0.27 $ 0.75 $ 1.13
Weighted average shares (basic and
diluted) 70,481 70,596 70,481 70,709
-------- -------- -------- --------Today's news release, along with other news about Franklin Street Properties Corp., is available on the Internet at www.franklinstreetproperties.com. A conference call is scheduled for November 5, 2008 at 9:30 a.m. (ET) to discuss the third quarter 2008 results. The toll free number is 1-800-295-4740, passcode 93615566. Internationally, the call may be accessed by dialing 1-617-614-3925, passcode 93615566. To listen via live audio webcast, please visit the Webcasts & Presentations section in the Investor Relations section of the Company's website, www.franklinstreetproperties.com at least ten minutes prior to the start of the call and follow the posted directions. The webcast will also be available via replay from the above location starting one hour after the call is finished. About Franklin Street Properties Corp. Franklin Street Properties Corp., based in Wakefield, Massachusetts, is focused on achieving current income and long-term growth through investments in commercial properties. FSP operates in two business segments: real estate operations and investment banking/investment services. The majority of FSP's property portfolio is suburban office buildings, with select investments in certain central business district properties. FSP's subsidiary, FSP Investments LLC (member, FINRA and SIPC), is a real estate investment banking firm and a registered broker/dealer. FSP is a Maryland corporation that operates in a manner intended to qualify as a real estate investment trust (REIT) for federal income tax purposes. To learn more about FSP please visit our website at www.franklinstreetproperties.com. Forward-Looking Statements Statements made in this press release that state FSP's or management's intentions, beliefs, expectations, or predictions for the future may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. This press release may also contain forward-looking statements based on current judgments and current knowledge of management, which are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements. Investors are cautioned that our forward-looking statements involve risks and uncertainty, including without limitation, changes in economic conditions in the United States, disruptions in the debt markets, changes in economic conditions in the markets in which we own properties, changes in the demand by investors for investment in Sponsored REITs (as defined in our Annual Report on Form 10-K for the year ended December 31, 2007), risks of a lessening of demand for the types of real estate owned by us, changes in government regulations, and expenditures that cannot be anticipated such as utility rate and usage increases, unanticipated repairs, additional staffing, insurance increases and real estate tax valuation reassessments. See the "Risk Factors" set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2007, as the same may be updated from time to time in subsequent filings with the United States Securities and Exchange Commission. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We will not update any of the forward-looking statements after the date of this press release to conform them to actual results or to changes in our expectations that occur after such date, other than as required by law.
Franklin Street Properties Corp.
Earnings Release
Supplementary information
Table of Contents
Franklin Street Properties Corp. Financial Results A-C
Real Estate Portfolio Summary Information D
Portfolio and Other Supplementary Information E
Prior 4 Quarters Information F
Largest 20 Tenants - FSP Owned Portfolio G
Definition of Funds From Operations (FFO) and FFO+GOS H
Franklin Street Properties Corp. Financial Results
Supplementary Schedule A
Condensed Consolidated Income Statements
(Unaudited)
For the Three For the Nine
Months Ended Months Ended
September 30, September 30,
------------------ ------------------
(in thousands, except per share
amounts) 2008 2007 2008 2007
-------- -------- -------- --------
Revenue:
Rental $ 27,927 $ 27,109 $ 82,283 $ 75,110
Related party revenue:
Syndication fees 304 687 3,766 7,090
Transaction fees 300 604 3,606 7,446
Management fees and interest
income from loans 380 1,497 1,364 5,176
Other 13 37 52 84
-------- -------- -------- --------
Total revenue 28,924 29,934 91,071 94,906
-------- -------- -------- --------
Expenses:
Real estate operating expenses 7,159 7,151 20,973 19,026
Real estate taxes and insurance 4,590 4,398 13,375 12,490
Depreciation and amortization 7,666 7,756 22,616 21,710
Selling, general and
administrative 1,927 1,787 6,557 5,675
Commissions 208 406 2,020 3,720
Interest 1,108 1,823 3,351 6,121
-------- -------- -------- --------
Total expenses 22,658 23,321 68,892 68,742
-------- -------- -------- --------
Income before interest income,
equity in earnings (losses) of
non-consolidated REITs and taxes 6,266 6,613 22,179 26,164
Interest income 177 650 657 1,864
Equity in earnings (losses) of
non-consolidated REITs 679 147 2,167 (611)
-------- -------- -------- --------
Income before taxes 7,122 7,410 25,003 27,417
Income tax expense (benefit) (297) (206) (337) 514
-------- -------- -------- --------
Income from continuing operations 7,419 7,616 25,340 26,903
-------- -------- -------- --------
Discontinued operations:
Income (loss) from discontinued
operations - (72) - 1,259
Gain on sale of assets, less
applicable income tax - 1,942 - 23,532
-------- -------- -------- --------
Total discontinued operations - 1,870 - 24,791
-------- -------- -------- --------
Net income $ 7,419 $ 9,486 $ 25,340 $ 51,694
======== ======== ======== ========
Weighted average number of shares
outstanding, basic and diluted 70,481 70,596 70,481 70,709
======== ======== ======== ========
Earnings per share, basic and
diluted, attributable to:
Continuing operations $ 0.11 $ 0.11 $ 0.36 $ 0.38
Discontinued operations - 0.02 - 0.35
-------- -------- -------- --------
Net income per share, basic and
diluted $ 0.11 $ 0.13 $ 0.36 $ 0.73
======== ======== ======== ========
Franklin Street Properties Corp. Financial Results
Supplementary Schedule B
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands, except share and par value
amounts) September 30, December 31,
------------ -------------
2008 2007
------------ -------------
Assets:
Real estate assets, net $ 812,438 $ 790,319
Acquired real estate leases, less accumulated
amortization of $26,831 and $23,401,
respectively 28,024 33,695
Investment in non-consolidated REITs 83,896 85,663
Assets held for syndication, net 13,335 26,310
Cash and cash equivalents 34,527 46,988
Restricted cash 336 336
Tenant rent receivables, less allowance for
doubtful accounts of $509 and $430, respectively 1,174 1,472
Straight-line rent receivable, less allowance
for doubtful accounts of $261 and $261,
respectively 8,255 7,387
Prepaid expenses 2,922 1,395
Other assets 1,475 406
Office computers and furniture, net of
accumulated depreciation of $1,075 and
$968, respectively 313 309
Deferred leasing commissions, net of
accumulated amortization of $2,988,
and $1,975, respectively 10,365 9,186
------------ -------------
Total assets $ 997,060 $ 1,003,466
============ =============
Liabilities and Stockholders' Equity:
Liabilities:
Bank note payable $ 105,118 $ 84,750
Accounts payable and accrued expenses 24,945 20,255
Accrued compensation 1,652 1,564
Tenant security deposits 1,823 1,874
Acquired unfavorable real estate leases, less
accumulated amortization of $1,587, and
$1,226, respectively 4,654 4,405
------------ -------------
Total liabilities 138,192 112,848
------------ -------------
Commitments and contingencies
Stockholders’ Equity:
Preferred stock, $.0001 par value, 20,000,000
shares authorized, none issued or
outstanding - -
Common stock, $.0001 par value, 180,000,000
shares authorized, 70,480,705 and
70,480,705 shares issued and outstanding,
respectively 7 7
Additional paid-in capital 889,019 889,019
Earnings (distributions) in excess of
accumulated earnings/distributions (30,158) 1,592
------------ -------------
Total stockholders' equity 858,868 890,618
------------ -------------
Total liabilities and stockholders' equity $ 997,060 $ 1,003,466
============ =============
Franklin Street Properties Corp. Financial Results
Supplementary Schedule C
Condensed Consolidated Statements of Cash Flows
(Unaudited)
For the Nine Months
Ended September 30,
------------------------
(in thousands) 2008 2007
=========== ===========
Cash flows from operating activities:
Net income $ 25,340 $ 51,694
Adjustments to reconcile net income to net
cash provided by operating activities:
Gains on assets sold - (23,532)
Depreciation and amortization expense 22,649 22,818
Amortization of above market lease 3,376 3,706
Equity in earnings (losses) from
non-consolidated REITs (2,167) 619
Distributions from non-consolidated REITs 3,838 1,199
Increase in bad debt reserve 79 -
Changes in operating assets and liabilities:
Restricted cash - 425
Tenant rent receivables, net 219 1,053
Straight-line rents, net (854) (2,924)
Prepaid expenses and other assets, net (1,474) (717)
Accounts payable and accrued expenses 3,863 572
Accrued compensation 88 (1,273)
Tenant security deposits (51) 179
Payment of deferred leasing commissions (2,434) (2,905)
----------- -----------
Net cash provided by operating activities 52,472 50,914
----------- -----------
Cash flows from investing activities:
Purchase of real estate assets, office
computers and furniture, capitalized merger
costs (37,215) (75,887)
Purchase of acquired favorable and
unfavorable leases (2,067) (3,726)
Investment in non-consolidated REITs (10) (18)
Investment in loan receivable (1,125) -
Redemption of certificate of deposit - 5,143
Investment in assets held for syndication,
net 12,235 (112,618)
Proceeds received on sales of real estate
assets - 85,673
----------- -----------
Net cash used in investing activities (28,182) (101,433)
----------- -----------
Cash flows from financing activities:
Distributions to stockholders (57,089) (65,813)
Purchase of treasury shares - (4,767)
Repayments under bank note payable, net 20,368 104,550
Deferred financing costs (30) (7)
----------- -----------
Net cash (used in) provided by financing
activities (36,751) 33,963
----------- -----------
Net increase (decrease) in cash and cash
equivalents (12,461) (16,556)
Cash and cash equivalents, beginning of period 46,988 69,973
----------- -----------
Cash and cash equivalents, end of period $ 34,527 $ 53,417
=========== ===========
Franklin Street Properties Corp. Earnings Release
Supplementary Schedule D
Real Estate Portfolio Summary Information
(Unaudited & Approximated)
Commercial portfolio lease expirations (1)
Total % of
Year Square Feet Portfolio
----------- ----------
2008 91,653 1.8%
2009 555,808 10.8%
2010 770,393 15.0%
2011 372,518 7.2%
2012 748,427 14.5%
2013 346,513 6.7%
Thereafter (2) 2,268,425 44.0%
----------- ----------
5,153,737 100.0%
=========== ==========
(1) Percentages are determined based upon square footage of
expiring commercial leases and if applicable, exclude assets held
for sale.
(2) Includes 380,000 square feet of current vacancies
(Dollars and square
feet in 000's) As of September 30, 2008
------------------------------------------------------
# of % of Square % of
State Properties Investment Portfolio Feet Portfolio
---------- ---------- --------- ---------- ---------
Texas 7 $ 235,444 29.0% 1,489 28.8%
Colorado 4 131,339 16.2% 791 15.4%
Georgia 1 77,872 9.6% 387 7.5%
Maryland 2 63,200 7.8% 424 8.2%
Virginia 2 62,631 7.6% 433 8.4%
Missouri 2 56,832 7.0% 349 6.8%
Florida 1 49,572 6.1% 213 4.1%
Indiana 1 37,622 4.6% 205 4.0%
Illinois 1 31,728 3.9% 177 3.5%
California 2 21,417 2.6% 182 3.5%
Michigan 1 15,274 1.9% 215 4.2%
Washington 1 15,073 1.9% 117 2.3%
North Carolina 2 14,433 1.8% 172 3.3%
---------- ---------- --------- ---------- ---------
27 $ 812,437 100.0% 5,154 100.0%
========== ========== ========= ========== =========
Property by type:
(dollars & square
feet in 000's) As of September 30, 2008
------------------------------------------------------
# of % of Square % of
Type Properties Investment Portfolio Feet Portfolio
---------- ---------- --------- ---------- ---------
Office 26 807,265 99.4% 5,055 98.1%
Industrial 1 5,172 0.6% 99 1.9%
---------- ---------- --------- ---------- ---------
27 $ 812,437 100.0% 5,154 100.0%
========== ========== ========= ========== =========
Franklin Street Properties Corp. Earnings Release
Supplementary Schedule E
Portfolio and Other Supplementary Information
(Unaudited & Approximated)
Capital Expenditures
Owned Portfolio Nine Months Ended
-----------------------
(in thousands) 30-Sep-08 30-Sep-07
----------- -----------
Tenant improvements $ 4,564 $ 5,599
Deferred leasing costs 2,434 2,905
Building improvements 1,310 3,596
----------- -----------
$ 8,308 $ 12,100
=========== ===========
Square foot & leased percentages September 30, December 31,
------------- -------------
2008 2007
------------- -------------
Owned portfolio of commercial real estate
Number of properties 27 26
Square feet 5,153,737 4,998,280
Leased percentage 93% 93%
Investments in non-consolidated commercial
real estate
Number of properties 2 3
Square feet 1,461,224 1,614,380
Leased percentage 79% 92%
Single Asset REITs (SARs) managed
Number of properties 10 9
Square feet* 2,683,105 2,682,770
Leased percentage* 92% 92%
Total owned, investments & managed properties
Number of properties* 39 38
Square feet* 9,298,066 9,295,430
Leased percentage* 90% 93%
*Excludes a property to be constructed with approximately 285,000 square
feet.
The following table shows property information for our investments in
non-consolidated REITs:
%
Square % Leased Interest
Single Asset REIT Name City State Feet 30-Sep-08 Held
-------- ------- --------- --------- --------
FSP 303 East Wacker Drive
Corp. Chicago IL 842,717 87.9% 43.7%
FSP Phoenix Tower Corp. Houston TX 618,507 67.9% 4.6%
--------- ---------
1,461,224 79.4%
--------- ---------
Franklin Street Properties Corp. Earnings Release
Supplementary Schedule F: Prior 4 Quarters Information
(Unaudited)
(in thousands)
Q3 Q4 Q1 Q2
Revenue: 2007 2007 2008 2008
-------- -------- -------- --------
Rental $ 27,109 $ 25,851 26,656 27,700
Related party revenue:
Syndication fees 687 1,896 205 3,257
Transaction fees 604 2,452 168 3,138
Management fees and
interest income from loans 1,497 1,854 561 423
Other 37 34 20 19
-------- -------- -------- --------
Total revenue 29,934 32,087 27,610 34,537
-------- -------- -------- --------
Expenses:
Real estate operating expenses 7,151 7,145 6,698 7,116
Real estate taxes and insurance 4,398 4,046 4,279 4,505
Depreciation and amortization 7,756 7,624 7,359 7,591
Selling, general and
administrative 1,787 1,790 2,009 2,621
Commissions 406 1,017 158 1,654
Interest 1,823 1,563 1,192 1,051
-------- -------- -------- --------
Total expenses 23,321 23,185 21,695 24,538
-------- -------- -------- --------
Income before interest income,
equity in earnings in
non-consolidated REITs 6,613 8,902 5,915 9,999
Interest income 650 514 303 176
Equity in earnings in
non-consolidated REITs 147 147 793 694
-------- -------- -------- --------
Income before taxes on income 7,410 9,563 7,011 10,869
Taxes on income (206) 359 (375) 335
-------- -------- -------- --------
Income from continuing operations 7,616 9,204 7,386 10,534
Loss from discontinued operations (72) (70) - -
Gain on sale of assets 1,942 257 - -
-------- -------- -------- --------
Net income $ 9,486 $ 9,391 $ 7,386 $ 10,534
======== ======== ======== ========
FFO and FFO+GOS calculations:
Net income $ 9,486 $ 9,391 $ 7,386 $ 10,534
-------- -------- -------- --------
(Gain) Loss on sale of assets (1,942) (257) - -
GAAP income from
non-consolidated REITs (106) (147) (793) (694)
Distributions from
non-consolidated REITs 476 607 546 1,731
Depreciation & amortization 9,008 8,978 8,498 8,712
-------- -------- -------- --------
Funds From Operations (FFO) 16,922 18,572 15,637 20,283
Plus gains on sales of assets
(GOS) 1,942 257 - -
-------- -------- -------- --------
FFO+GOS $ 18,864 $ 18,829 $ 15,637 $ 20,283
======== ======== ======== ========
Franklin Street Properties Corp. Earnings Release
Supplementary Schedule G
Largest 20 Tenants -- FSP Owned Portfolio
(Unaudited & Estimated)
The following table includes the largest 20 tenants in FSP's owned
portfolio based on square feet leased.
% of
Tenant Sq Ft SIC Code Portfolio
--------- --------- ---------
1 Capital One Services, Inc.* (1) 297,789 61 6.0%
2 Citgo Petroleum Corporation 248,399 29 5.0%
3 Tektronix Texas, LLC 241,372 38 4.8%
4 Burger King Corporation 212,619 58 4.3%
5 New Era of Networks, Inc. (Sybase) 199,077 42 4.0%
6 Citgroup Credit Services, Inc. 176,848 61 3.5%
7 RGA Reinsurance Company 171,120 63 3.4%
8 International Business Machines Corp. 138,033 73 2.8%
9 Murphy Exploration & Production Company 133,786 13 2.7%
10 CACI Technologies, Inc. 132,896 73 2.7%
11 Maines Paper and Food Service, Inc. 98,745 42 2.0%
12 Jones Lang Lasalle 92,827 87 1.9%
13 AMDOCS, Inc. 91,928 73 1.8%
14 Ober Kaler Grimes 90,811 81 1.8%
15 County of Santa Clara 90,467 91 1.8%
16 Vail Corp, dba Vail Resorts 83,620 79 1.7%
17 Corporate Holdings, LLC 81,818 67 1.6%
18 Technip-Coflexip USA Holdings, Inc 79,496 73 1.6%
19 Noble Royalties, Inc. 78,344 67 1.6%
20 Cooley Godward LLP 72,850 81 1.5%
--------- ---------
Total 2,812,845 56.3%
--------- ---------
(1) Capital One subleases all of its space to LandAmerica Financial Group.
Franklin Street Properties Corp. Earnings Release
Supplementary Schedule H
Definition of Funds From Operations ("FFO"),
and FFO plus Gains on Sales ("FFO+GOS")The Company evaluates the performance of its reportable segments based on several measures including, Funds From Operations ("FFO") and FFO plus Gains on Sales ("FFO+GOS") as management believes they represent important measures of activity and are an important consideration in determining distributions paid to equity holders. The Company defines FFO as net income (computed in accordance with generally accepted accounting principles, or GAAP), excluding gains (or losses) from sales of property, plus depreciation and amortization, and after adjustments to exclude non-cash income (or losses) from non-consolidated or Sponsored REITs, plus distributions received from non-consolidated or Sponsored REITs. The Company defines FFO+GOS as FFO as defined above, plus gains (or losses) from sales of properties and provisions for assets held for sale, if applicable. FFO and FFO+GOS should not be considered as alternatives to net income (determined in accordance with GAAP), as indicators of the Company's financial performance, nor as alternatives to cash flows from operating activities (determined in accordance with GAAP), nor as measures of the Company's liquidity, nor are they necessarily indicative of sufficient cash flow to fund all of the Company's needs. Other real estate companies may define these terms in a different manner. We believe that in order to facilitate a clear understanding of the results of the Company, FFO and FFO+GOS should be examined in connection with net income and cash flows from operating, investing and financing activities in the consolidated financial statements. Contact: Contact:
Donna Brownell
877-686-9496
Franklin Street Properties Corp.
401 Edgewater Place
Suite 200
Wakefield, Massachusetts 01880-6210
(781) 557-1300
http://www.franklinstreetproperties.com
Source: Franklin Street Properties Corp.
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