MELVILLE, N.Y.--(BUSINESS WIRE)--Oct. 31, 2005--Reckson Associates
Realty Corp. (NYSE: RA) today reported diluted funds from operations
(FFO) of $51.7 million or $0.61 per share for the third quarter of
2005, representing a per share increase of approximately 9% over
diluted FFO of $44.9 million or $0.56 per share for the third quarter
of 2004 when adjusted for the $6.7 million accounting charge
recognized in connection with the redemption of Reckson's 7 5/8%
Series A Preferred stock.
Reckson reported net income allocable to common shareholders of
$113.6 million, including $96.4 million related to gains on sales of
depreciable real estate, or diluted earnings per share (EPS) of $1.37
for the third quarter of 2005, as compared to $8.8 million, including
$2.2 million related to gains on sales of depreciable real estate and
the aforementioned $6.7 million accounting charge, or diluted EPS of
$0.13 for the third quarter of 2004.
Commenting on the Company's performance, Scott Rechler, Reckson's
President and Chief Executive Officer, stated, "I am extremely pleased
with our third quarter results and progress. During this quarter, we
continued to produce strong operating results while executing on a
number of our previously announced strategic initiatives. We reported
9% FFO growth, 4.7% office same property NOI growth and 15.8% growth
in office same space rents. This was the sixth quarter in a row that
we have produced positive same property NOI growth." Mr. Rechler
continued, "We also executed on a wide range of strategic directives.
We launched Reckson New York Property Trust, our newly-formed property
trust listed on the Australian Stock Exchange; we furthered our
recapitalization of One Court Square by entering into a contract to
sell a joint venture interest in the property; we completed the
construction and anticipate an accelerated lease-up at our ground-up
development project at 68 South Service Road; we closed on the
acquisition of the 1.1 million square foot Reckson Plaza; and we sold
or contracted to sell $158 million of non-core operating properties at
attractive pricing."
A reconciliation of net income allocable to common shareholders to
FFO is in the financial statements accompanying this press release.
Net income allocable to common shareholders is the GAAP measure the
Company believes to be the most directly comparable to FFO.
Michael Maturo, Reckson's Chief Financial Officer, noted, "Year to
date we have match funded over $1 billion of investments with
approximately $900 million of non-core and core plus asset
dispositions which is consistent with our strategy of focusing our
portfolio on strategic and value-added assets which enhance growth and
the quality of our cash flows. Additionally, our successful capital
recycling activities, as well as establishing a new equity source in
the Australian property trust market, provides our balance sheet with
significant flexibility and capacity to fund the company's future
growth initiatives."
Summary Portfolio Performance
The Company reported office occupancy at September 30, 2005 of
94.1%. This compares to 93.7% at June 30, 2005 and 93.9% at September
30, 2004. The Company reported portfolio occupancy of 93.0% at
September 30, 2005, as compared to 92.6% at June 30, 2005 and 93.1% at
September 30, 2004.
The Company also reported same property office occupancy at
September 30, 2005 of 93.3%. This compares to 92.9% at June 30, 2005
and 93.9% at September 30, 2004. The Company reported same property
portfolio occupancy of 92.2% at September 30, 2005, as compared to
91.8% at June 30, 2005 and 93.1% at September 30, 2004.
Office same property net operating income (property operating
revenues less property operating expenses) (NOI), net of minority
interests in joint ventures, before termination fees for the third
quarter of 2005 increased 5.3% (on a straight-line rent basis) and
3.2% (on a cash basis), compared to the third quarter of 2004.
Portfolio same property NOI, net of minority interests in joint
ventures, before termination fees for the third quarter of 2005
increased 4.9% (on a straight-line rent basis) and 3.0% (on a cash
basis), compared to the third quarter of 2004.
Office same property NOI, including consolidated joint ventures,
before termination fees for the third quarter of 2005 increased 4.7%
(on a straight-line rent basis) and 2.5% (on a cash basis), compared
to the third quarter of 2004. Portfolio same property NOI, including
consolidated joint ventures, before termination fees for the third
quarter of 2005 increased 4.3% (on a straight-line rent basis) and
2.4% (on a cash basis), compared to the third quarter of 2004.
Other Highlights
Leasing Activity
-- Executed 72 lease transactions totaling 433,588 square feet
during the third quarter of 2005
-- Rent performance on renewal and replacement space during the
third quarter of 2005 increased 15.8% (on a straight-line rent
basis) and 3.9% (on a cash basis) in the office portfolio
Executed a Number of Strategic Initiatives
-- Closed tranche I of a public offering in Australia of
approximately A$263 million (approximately US$202 million) of
units in Reckson New York Property Trust, a newly-formed,
Reckson-sponsored property trust (the LPT) trading on the
Australian Stock Exchange (ASX). Upon completion of all the
related transactions, the LPT will own a 75% indirect interest
in 25 suburban core plus office properties acquired from
Reckson, containing approximately 3.4 million square feet, for
a total purchase price of approximately US$563 million.
Reckson will retain a 25% indirect interest in these
properties. The transaction has been structured to be
completed in three tranches. The LPT has a two-year option to
purchase an additional ten suburban core plus office
properties from Reckson, comprising approximately 1.2 million
square feet, to be priced at fair market value at the time the
option is exercised. Reckson anticipates that it will continue
to maintain a 25% indirect interest in future core plus
investments with the LPT. The Australian LPT structure will
enable Reckson to achieve a strategic objective of increasing
scale without diluting existing Reckson shareholders.
Affiliates of Reckson shall provide asset management, property
management and leasing services to the LPT and earn additional
fees relating to certain future transactions including
acquisitions, dispositions and financings.
-- Entered into a contract for the recapitalization of One Court
Square, Long Island City. Reckson acquired the building in May
2005, for a total investment of $471 million, at a 6.5%
initial unleveraged cash flow yield and 6.8% GAAP yield. In
June 2005, Reckson refinanced its acquisition bridge facility
with a $315 million, 10-year, interest-only mortgage, at an
interest rate of 4.9%. In October 2005, Reckson entered into a
contract to sell a 65%-70% joint venture interest to a group
of institutional investors led by JPMorgan Asset Management.
Based on a promoted structure and the sale of a 70% interest,
Reckson anticipates an unleveraged GAAP yield of approximately
8% and a leveraged GAAP return on equity of approximately 13%.
It is anticipated that the transaction will close during the
fourth quarter of 2005. The contract is subject to customary
closing conditions, including due diligence.
-- Completed construction of the base building at 68 South
Service Road in Melville, Long Island, ahead of schedule. The
total anticipated investment is approximately $61 million.
Reckson anticipates an accelerated lease-up of the building
and is currently negotiating a long-term lease for a
substantial portion of the building. The Company anticipates a
stabilized NOI yield of approximately 10%.
Acquisition Activity
-- Acquired a 1.1 million square foot, Class A trophy office
complex consisting of two 15-story office towers located in
Uniondale, Long Island, for approximately $240 million.
Reckson Plaza, formerly known as EAB Plaza, is the largest and
most recognizable office complex on Long Island and is
approximately 90% occupied and is leased to high credit
quality tenants. Reckson expects to generate an initial GAAP
NOI yield of approximately 6.5% and anticipates that its
property operating initiatives will result in cumulative
annual NOI growth in excess of 5.0%. Reckson utilized this
acquisition as the replacement property in like-kind (1031)
exchanges to defer approximately $108 million of tax gains on
the sale of properties. In addition, Reckson has purchased the
adjoining 8.2-acre development site, for $19.0 million, which
is anticipated to be contributed into a joint venture between
Reckson and the owner of the New York Islanders in connection
with the proposed redevelopment of the Nassau Coliseum site.
-- Acquired a 118,000 square foot, four-story, Class A office
building, located at 711 Westchester Avenue, White Plains,
Westchester, for approximately $24.8 million, or $210 per
square foot. Built in 1978, and fully renovated in 1997, the
building is a high quality asset situated on 10 acres and
offers a superior quality amenity package. The property is
well-located off I-287, at the intersection of I-684 and the
Hutchinson River Parkway, along the I-287 Platinum Mile
Corridor. The property is currently 94% occupied and after the
rollover of leases totaling approximately 50,000 square feet
in 2007, Reckson expects to generate a stabilized NOI yield of
approximately 8.2%. This acquisition was partially financed
through the assumption of approximately $12.5 million of
existing first mortgage debt with an interest rate of 5.4% per
annum and a maturity date of January 1, 2015. Reckson
currently owns and operates approximately 622,000 square feet
of space in the White Plains submarket in Westchester.
Disposition of Non-Strategic Operating Assets
-- Entered into a contract for the sale of 100 Wall Street, New
York City, a 462,000 square foot office building located in
downtown Manhattan, for approximately $134 million, or $290
per square foot. 100 Wall Street is Reckson's only asset in
the downtown submarket and has substantial rollover in the
near-term. Reckson will provide the purchaser with a mezzanine
loan in the amount of $30.0 million which will bear interest
at 15% per annum and have a term of two years. Reckson
estimates a GAAP gain of $50.5 million on the sale. The tax
gain of approximately $48 million from the sale of this
property will be deferred as part of a like-kind (1031)
exchange in conjunction with the aforementioned purchase of
Reckson Plaza. It is anticipated the closing will take place
during the fourth quarter of 2005. The contract is subject to
customary closing conditions and the removal of the existing
mortgage which Reckson intends to transfer to replacement
collateral.
-- Sold two medical office buildings totaling 69,000 square feet,
located at 310 and 333 East Shore Road, Great Neck, Long
Island for approximately $17.3 million, or approximately $250
per square foot. The GAAP gain on sale is $14.1 million.
-- Entered into a contract to sell a single story flex-use office
building totaling 35,000 square feet, located at 48 Harbor
Park Drive, Port Washington, Long Island, to a user, for
approximately $6.4 million, or approximately $182 per square
foot. Reckson estimates a GAAP gain of $3.0 million on the
sale. It is anticipated the closing will take place during the
fourth quarter of 2005.
Development Activity
-- Entered into a letter of intent with the owner of the New York
Islanders to enter into a 50/50 joint venture to potentially
develop over 5 million square feet of office, residential,
retail and hotel space in the Mitchel Field, Long Island
sub-market in and around Nassau Veterans Memorial Coliseum
where Reckson is currently the largest owner of office
properties. The joint venture is currently participating in
the Nassau County request for proposal process. In addition,
if selected Reckson would serve as the master developer of the
development project. The development, which has other
competing proposals, is subject to numerous governmental
approvals, compliance, zoning and other customary approvals.
Earnings Guidance
During the Company's quarterly earnings conference call on
November 1, 2005, management will discuss earnings guidance. The
Company is providing fourth quarter 2005 diluted FFO guidance in the
range of $0.59 to $0.60 per share which reflects accelerated
dispositions and full-year 2006 diluted FFO guidance in the range of
$2.45 to $2.57, representing 5% to 10% growth over 2005.
For detailed information pertaining to the assumptions used for
estimating the Company's forecasted earnings guidance range please
refer to Reckson's third quarter 2005 presentation which can be found
on the Company's web site at www.reckson.com.
Reconciliation of Earnings Guidance
The Company's guidance for diluted FFO is reconciled from GAAP net
income below:
Fourth Quarter Full Year
2005 2006
----------------- -----------------
Low End High End Low End High End
-------- -------- -------- --------
Net income allocable to common
shareholders $ 0.25 $ 0.26 $ 2.11 $ 2.23
Add: Real estate depreciation and
amortization 0.34 0.34 1.22 1.22
Less: Gain on sales of depreciable
real estate 0.00 0.00 0.88 0.88
-------- -------- -------- --------
Diluted FFO Per Share $ 0.59 $ 0.60 $ 2.45 $ 2.57
======== ======== ======== ========
This guidance is based upon management's current estimates. Actual
results may differ materially. This information involves
forward-looking statements which are subject to uncertainties noted
below under Forward-Looking Statements.
Non-GAAP Financial Measures
Funds from Operations (FFO)
The Company believes that FFO is a widely recognized and
appropriate measure of performance of an equity REIT. The Company
presents FFO because it considers it an important supplemental measure
of the Company's operating performance and believes it is frequently
used by securities analysts, investors and other interested parties in
the evaluation of REITs, many of which present FFO when reporting
their results. FFO is intended to exclude GAAP historical cost
depreciation and amortization of real estate and related assets, which
assumes that the value of real estate diminishes ratably over time.
Historically, however, real estate values have risen or fallen with
market conditions. As a result, FFO provides a performance measure
that, when compared year over year, reflects the impact to operations
from trends in occupancy rates, rental rates, operating costs,
development activities, interest costs and other matters without the
inclusion of depreciation and amortization, providing perspective that
may not necessarily be apparent from net income. The Company computes
FFO in accordance with standards established by the National
Association of Real Estate Investment Trusts (NAREIT). FFO is defined
by NAREIT as net income or loss, excluding gains or losses from sales
of depreciable properties plus real estate depreciation and
amortization, and after adjustments for unconsolidated partnerships
and joint ventures. FFO does not represent cash generated from
operating activities in accordance with GAAP and is not indicative of
cash available to fund cash needs. FFO should not be considered as an
alternative to net income as an indicator of the Company's operating
performance or as an alternative to cash flow as a measure of
liquidity. Since all companies and analysts do not calculate FFO in a
similar fashion, the Company's calculation of FFO presented herein may
not be comparable to similarly titled measures as reported by other
companies.
Reckson Associates Realty Corp. is a self-administered and
self-managed real estate investment trust (REIT) specializing in the
acquisition, leasing, financing, management and development of Class A
office properties.
Reckson's core growth strategy is focused on the markets
surrounding and including New York City. The Company is one of the
largest publicly traded owners, managers and developers of Class A
office properties in the New York Tri-State area, and wholly owns, has
substantial interests in, or has under contract, a total of 89
properties comprised of approximately 18.5 million square feet. For
additional information on Reckson Associates Realty Corp., please
visit the Company's web site at www.reckson.com.
Conference Call and Webcast
The Company's executive management team, led by President and
Chief Executive Officer Scott Rechler, will host a conference call
outlining third quarter results on November 1, 2005 at 12:00 p.m. EST.
The conference call may be accessed by dialing (800) 553-0318
(internationally (612) 332-0335). No passcode is required. The live
conference call will also be webcast in a listen-only mode on the
Company's web site at www.reckson.com, in the Investor Relations
section, with an accompanying slide show presentation outlining the
Company's third quarter results.
A replay of the conference call will be available telephonically
from November 1, 2005 at 5:30 p.m. EST through November 9, 2005 at
11:59 p.m. EST. The telephone number for the replay is (800) 475-6701,
passcode 797057. A replay of the webcast of the conference call will
also be available via the Company's web site.
Financial Statements Attached
The Supplemental Package and Slide Show Presentation outlining the
Company's third quarter 2005 results will be available prior to the
Company's quarterly conference call on the Company's web site at
www.reckson.com in the Investor Relations section, by e-mail to those
on the Company's distribution list, as well as by mail or fax, upon
request. To be added to the Company's e-mail distribution list or to
receive a copy of the quarterly materials by mail or fax, please
contact Susan McGuire, Senior Vice President Investor Relations,
Reckson Associates Realty Corp., 225 Broadhollow Road, Melville, New
York 11747-4883, investorrelations@reckson.com or (631) 622-6746.
Forward-Looking Statements
Certain matters discussed herein, including guidance concerning
the Company's future performance, are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of
1995. Although the Company believes the expectations reflected in such
forward-looking statements are based on reasonable assumptions,
forward-looking statements are not guarantees of results and no
assurance can be given that the expected results will be delivered.
Such forward-looking statements are subject to certain risks, trends
and uncertainties that could cause actual results to differ materially
from those expected. Among those risks, trends and uncertainties are
the general economic climate, including the conditions affecting
industries in which our principal tenants compete; financial condition
of our tenants; changes in the supply of and demand for office
properties in the New York Tri-State area; changes in interest rate
levels; changes in the Company's credit ratings; changes in the
Company's cost of and access to capital; downturns in rental rate
levels in our markets and our ability to lease or re-lease space in a
timely manner at current or anticipated rental rate levels; the
availability of financing to us or our tenants; changes in operating
costs, including utility, real estate taxes, security and insurance
costs; repayment of debt owed to the Company by third parties; risks
associated with joint ventures; liability for uninsured losses or
environmental matters; and other risks associated with the development
and acquisition of properties, including risks that development may
not be completed on schedule, that the tenants will not take occupancy
or pay rent, or that development or operating costs may be greater
than anticipated. For further information on factors that could impact
Reckson, reference is made to Reckson's filings with the Securities
and Exchange Commission. Reckson undertakes no responsibility to
update or supplement information contained in this press release.
Reckson Associates Realty Corp. (NYSE: RA)
Consolidated Statements of Income
(in thousands, except share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- ----------------------
2005 2004 2005 2004
---------------------- ----------------------
Property Operating
Revenues:
Base rents $124,130 $106,605 $358,181 $318,877
Tenant escalations
and reimbursements 21,163 18,865 56,370 53,105
---------------------- ----------------------
Total property
operating
revenues 145,293 125,470 414,551 371,982
---------------------- ----------------------
Property Operating
Expenses:
Operating expenses 36,157 31,421 98,273 90,180
Real estate taxes 22,881 20,907 66,177 59,783
---------------------- ----------------------
Total property
operating
expenses 59,038 52,328 164,450 149,963
---------------------- ----------------------
Net Operating Income 86,255 73,142 250,101 222,019
---------------------- ----------------------
Gross Margin percentage 59.4% 58.3% 60.3% 59.7%
---------------------- ----------------------
Other Income
Investment income and
other 10,590 7,354 17,742 16,646
Gains on sales of
real estate 85,512 - 85,512 -
---------------------- ----------------------
Total other
income 96,102 7,354 103,254 16,646
---------------------- ----------------------
Other Expenses
Interest
Expense 31,985 24,120 82,810 74,388
Amortization of
deferred financing
costs 1,118 1,005 3,177 2,831
Depreciation and
amortization 35,486 28,697 96,546 83,477
Marketing, general
and administrative 8,224 7,503 24,597 21,586
---------------------- ----------------------
Total other
expenses 76,813 61,325 207,130 182,282
---------------------- ----------------------
Income before minority
interests, preferred
dividends and
distributions and
discontinued operations 105,544 19,171 146,225 56,383
Minority partners'
interests in
consolidated
partnerships (3,740) (4,135) (11,368) (14,738)
Distributions to
preferred unit holders - (41) - (541)
Limited partners'
minority interest in
the operating
partnership (3,297) (235) (4,646) (1,182)
---------------------- ----------------------
Income before
discontinued operations
and preferred dividends 98,507 14,760 130,211 39,922
Discontinued operations
(net of minority
interests)
Gains on sales
of real estate 13,615 2,228 13,790 11,069
Income from
discontinued
operations 1,433 2,006 4,671 5,443
---------------------- ----------------------
Net income 113,555 18,994 148,672 56,434
Redemption charges on
series a preferred
stock - (6,717) - (6,717)
Dividends to preferred
shareholders - (3,437) - (11,868)
---------------------- ----------------------
Net income allocable to
common shareholders $113,555 $8,840 $148,672 $37,849
====================== ======================
Basic weighted average
common shares
outstanding: 82,545,000 70,237,000 81,848,000 66,179,000
Basic net income per
weighted average common
share:
Common stock - income
from continuing
operations $0.16 $0.07 $0.55 $0.32
Gains on sales of
real estate 1.04 - 1.04 -
Discontinued
operations 0.18 0.06 0.23 0.25
---------------------- ----------------------
Basic net income per
common share $1.38 $0.13 $1.82 $0.57
====================== ======================
Diluted weighted average
common shares
outstanding: 83,026,000 70,510,000 82,284,000 66,533,000
====================== ======================
Diluted net income per
weighted average common
share: $1.37 $0.13 $1.81 $0.57
====================== ======================
Reckson Associates Realty Corp. (NYSE: RA)
Consolidated Balance Sheets
(in thousands, except share amounts)
September December
30, 2005 31, 2004
----------- -----------
Assets: (Unaudited)
Commercial real estate properties, at cost:
Land $385,457 $362,826
Buildings and improvements 2,452,509 2,332,562
Developments in progress:
Land 101,371 90,976
Development costs 81,981 42,169
Furniture, fixtures, and equipment 12,391 11,611
----------- -----------
3,033,709 2,840,144
Less: accumulated depreciation (516,399) (445,411)
----------- -----------
Investment in real estate, net of accumulated
depreciation 2,517,310 2,394,733
Properties and related assets held for sale,
net of accumulated depreciation 669,596 345,392
Investment in real estate joint ventures 12,946 6,657
Investment in notes receivable 166,219 85,855
Investments in affiliate loans and joint
ventures 57,642 60,951
Cash and cash equivalents 32,799 25,137
Tenant receivables 11,157 9,558
Deferred rents receivable 135,399 109,890
Prepaid expenses and other assets 179,884 59,467
Contract and land deposits and pre-acquisition
costs 2,898 121
Deferred leasing and loan costs (net of
accumulated amortization) 77,282 69,847
----------- -----------
Total Assets $3,863,132 $3,167,608
----------- -----------
Liabilities:
Mortgage notes payable $531,527 $609,518
Unsecured credit facility 231,000 235,500
Senior unsecured notes 979,970 697,974
Liabilities associated with properties held
for sale 407,841 6,091
Accrued expenses and other liabilities 77,245 67,758
Deferred revenues and tenant security deposits 75,296 50,373
Dividends and distributions payable 36,232 35,924
----------- -----------
Total Liabilities 2,339,111 1,703,138
----------- -----------
Minority partners' interests in consolidated
partnerships 214,608 211,178
Preferred unit interest in the operating
partnership 1,200 1,200
Limited partners' minority interest in the
operating partnership 33,719 53,231
----------- -----------
249,527 265,609
----------- -----------
Commitments and contingencies - -
Stockholders' Equity:
Preferred Stock, $.01 par value, 25,000,000
shares authorized - -
Common Stock, $.01 par value, 200,000,000
shares authorized - -
82,556,273 and 80,618,339 shares issued and
outstanding, respectively 826 806
Accumulated other comprehensive loss (477) -
Treasury Stock, 3,318,600 shares (68,492) (68,492)
Additional paid in capital 1,342,637 1,266,547
----------- -----------
Total Stockholders' Equity 1,274,494 1,198,861
----------- -----------
Total Liabilities and
Stockholders' Equity $3,863,132 $3,167,608
----------- -----------
Total debt to market capitalization (a): 41.3% 33.8%
----------- -----------
---------
(a) Total debt includes the Company's pro rata share of consolidated
and unconsolidated joint venture debt.
Reckson Associates Realty Corp. (NYSE: RA)
Funds From Operations
(in thousands, except per share amounts)
Three Months Nine Months
Ended Ended
September 30, September 30,
----------------- ------------------
2005 2004 2005 2004
----------------- ------------------
Net income allocable to common
shareholders $113,555 $8,840 $148,672 $37,849
Add: Real estate depreciation
and amortization 32,903 26,758 90,391 78,100
Minority partners'
interests in consolidated
partnerships 6,741 7,117 20,244 23,931
Limited partners' minority
interest in the operating
partnership 2,930 453 4,197 2,090
Less: Amounts distributable to
minority partners in
consolidated partnerships 5,600 6,070 16,804 20,985
Gains on sales of
depreciable real estate 98,861 2,381 98,861 11,322
----------------- ------------------
Basic Funds From Operations
("FFO") 51,668 34,717 147,839 109,663
Add: Dividends and
distributions on dilutive
shares and units - 41 - 541
----------------- ------------------
Diluted FFO $51,668 $34,758 $147,839 $110,204
================= ==================
Diluted FFO calculations:
Weighted average common
shares outstanding 82,545 70,237 81,848 66,179
Weighted average units of
limited partnership
interest outstanding 2,083 3,552 2,623 3,551
----------------- ------------------
Basic weighted average
common shares and units
outstanding 84,628 73,789 84,471 69,730
Adjustments for dilutive
FFO weighted average
shares and units
outstanding:
Common stock
equivalents 481 273 436 354
Limited partners'
preferred interest 41 127 41 455
----------------- ------------------
Total diluted weighted average
shares and units outstanding 85,150 74,189 84,948 70,539
================= ==================
Diluted FFO per weighted average
share or unit $0.61 $0.47 $1.74 $1.56
Diluted weighted average
dividends per share $0.42 $0.42 $1.27 $1.27
Diluted FFO payout ratio 70.0% 90.7% 73.2% 81.6%
FFO Data excluding redemption
charges incurred on Series A
preferred stock:
Diluted FFO per weighted average
share or unit $0.61 $0.56 $1.74 $1.65
Diluted weighted average
dividends per share $0.42 $0.42 $1.27 $1.27
Diluted FFO payout ratio 70.0% 76.4% 73.2% 77.2%
Reconciliation from Net Income allocable to common
shareholders to Diluted FFO excluding redemption
charges:
Net income allocable to common
shareholders $8,840 $37,849
Add: Redemption charges
incurred on Series A
preferred stock 6,717 6,717
Real estate depreciation
and amortization 26,758 78,100
Minority partners'
interests in consolidated
partnerships 7,117 23,931
Limited partners' minority
interest in the operating
partnership 453 2,090
Dividends and
distributions on dilutive
shares and units 3,477 12,354
Less: Amounts distributable to
minority partners in
consolidated partnerships 6,070 20,985
Gain on sales of
depreciable real estate 2,381 11,322
-------- ---------
Diluted FFO excluding redemption
charges $44,911 $128,734
======== =========
Diluted weighted average shares
and units outstanding 80,755 77,867
======== =========
Reckson Associates Realty Corp. (NYSE: RA)
Cash Available for Distribution
(in thousands, except per share amounts)
Three Months Nine Months
Ended Ended
September 30, September 30,
---------------- ------------------
2005 2004 2005 2004
---------------- ------------------
Basic Funds From Operations $51,668 $34,717 $147,839 $109,663
Adjustments for basic cash
available for distribution:
Less: Straight line rents and
other FAS 141 non-cash
rent adjustments 10,020 6,427 29,938 18,441
Committed non-incremental
capitalized tenant
improvements and leasing
costs 6,653 6,834 25,694 25,361
Actual non-incremental
capitalized improvements 2,399 2,129 7,473 5,984
Add: Redemption charges on
series A preferred stock - 6,717 - 6,717
---------------- ------------------
Basic Cash Available for
Distribution ("CAD") 32,596 26,044 84,734 66,594
Add: Dividends and distributions
on dilutive shares and
units - 25 - -
---------------- ------------------
Diluted CAD $32,596 $26,069 $84,734 $66,594
================ ==================
Diluted CAD calculations:
Weighted average common
shares outstanding 82,545 70,237 81,848 66,179
Weighted average units of
limited partnership
interest outstanding 2,083 3,552 2,623 3,551
---------------- ------------------
Basic weighted average
common shares and units
outstanding 84,628 73,789 84,471 69,730
Adjustments for dilutive
CAD weighted average
shares and units
outstanding:
Common stock equivalents 481 273 436 354
Limited partners'
preferred interest 41 88 41 -
---------------- ------------------
Total diluted weighted average
shares and units outstanding 85,150 74,150 84,948 70,084
================ ==================
Diluted CAD per weighted average
share or unit $0.38 $0.35 $1.00 $0.95
Diluted weighted average dividends
per share $0.42 $0.42 $1.27 $1.27
Diluted CAD payout ratio 111.0% 120.9% 127.8% 134.1%
CONTACT: Reckson Associates Realty Corp.
Scott Rechler, CEO or Michael Maturo, CFO, 631-694-6900
Facsimile: 631-622-6790
SOURCE: Reckson Associates Realty Corp.
