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Paramount Announces Second Quarter 2022 Results

Raises Guidance for Full Year 2022

Paramount Group, Inc. (NYSE: PGRE) (“Paramount” or the “Company”) filed its Quarterly Report on Form 10-Q for the quarter ended June 30, 2022 today and reported results for the second quarter ended June 30, 2022.

Second Quarter Highlights:

  • Reported net loss attributable to common stockholders of $0.4 million, or $0.00 per diluted share, for the quarter ended June 30, 2022, compared to $15.9 million, or $0.07 per diluted share, for the quarter ended June 30, 2021.
  • Reported Core Funds from Operations (“Core FFO”) attributable to common stockholders of $53.6 million, or $0.24 per diluted share, for the quarter ended June 30, 2022, compared to $47.6 million, or $0.22 per diluted share, for the quarter ended June 30, 2021.
  • Raised its full year 2022 earnings guidance as follows:
    • Estimated earnings attributable to common stockholders will be between a net loss of $0.01 per diluted share and net income of $0.03 per diluted share, compared to its prior estimated range of net loss attributable to common stockholders of $0.05 and $0.01 per diluted share, an increase in net income of $0.04 per diluted share at the midpoint of the Company’s prior estimate.
    • Estimated Core FFO attributable to common stockholders will be between $0.95 and $0.99 per diluted share, compared to its prior estimated range of $0.93 to $0.97 per diluted share, an increase of $0.02 per diluted share at the midpoint of the Company’s prior guidance.
  • Reported a 5.6% increase in Same Store Cash Net Operating Income (“NOI”) and a 9.0% increase in Same Store NOI in the quarter ended June 30, 2022, compared to the same period in the prior year.
  • Leased 250,231 square feet, of which the Company’s share was 188,175 square feet that was leased at a weighted average initial rent of $78.28 per square foot. Of the 188,175 square feet that was leased, 96,052 square feet represented the Company’s share of second generation space, for which rental rates decreased by 5.3% on a cash basis and increased by 0.5% on a GAAP basis.
  • Declared a second quarter cash dividend of $0.0775 per common share on June 15, 2022, which was paid on July 15, 2022.
  • Subsequent to quarter end, repurchased 268,231 common shares at a weighted average price of $6.96 per share, or $1.9 million in the aggregate.

Financial Results

Quarter Ended June 30, 2022

Net loss attributable to common stockholders was $0.4 million, or $0.00 per diluted share, for the quarter ended June 30, 2022, compared to $15.9 million, or $0.07 per diluted share, for the quarter ended June 30, 2021. Net loss attributable to common stockholders for the quarter ended June 30, 2021 includes a $10.7 million contribution to an unconsolidated joint venture, that was expensed in accordance with GAAP.

Funds from Operations (“FFO”) attributable to common stockholders was $53.3 million, or $0.24 per diluted share, for the quarter ended June 30, 2022, compared to $37.9 million, or $0.17 per diluted share, for the quarter ended June 30, 2021. FFO attributable to common stockholders for the quarter ended June 30, 2021 includes a $10.7 million contribution to an unconsolidated joint venture, that was expensed in accordance with GAAP. FFO attributable to common stockholders for the quarters ended June 30, 2022 and 2021 also includes the impact of other non-core items, which are listed in the table on page 9. The aggregate of the non-core items, net of amounts attributable to noncontrolling interests, decreased FFO attributable to common stockholders for the quarter ended June 30, 2022 and 2021 by $0.3 million and $9.7 million, respectively, or $0.00 and $0.05 per diluted share, respectively.

Core FFO attributable to common stockholders, which excludes the impact of the non-core items listed on page 9, was $53.6 million, or $0.24 per diluted share, for the quarter ended June 30, 2022, compared to $47.6 million, or $0.22 per diluted share, for the quarter ended June 30, 2021.

Six Months Ended June 30, 2022

Net income attributable to common stockholders was $3.0 million, or $0.01 per diluted share, for the six months ended June 30, 2022, compared to net loss attributable to common stockholders of $19.5 million, or $0.09 per diluted share, for the six months ended June 30, 2021. Net loss attributable to common stockholders for the six months ended June 30, 2021 includes a $10.7 million contribution to an unconsolidated joint venture, that was expensed in accordance with GAAP.

FFO attributable to common stockholders was $108.2 million, or $0.49 per diluted share, for the six months ended June 30, 2022, compared to $88.8 million, or $0.40 per diluted share, for the six months ended June 30, 2021. FFO attributable to common stockholders for the six months ended June 30, 2021 includes a $10.7 million contribution to an unconsolidated joint venture, that was expensed in accordance with GAAP. FFO attributable to common stockholders for the six months ended June 30, 2022 and 2021 also includes the impact of other non-core items, which are listed in the table on page 9. The aggregate of the non-core items, net of amounts attributable to noncontrolling interests, did not impact FFO attributable to common stockholders for the six months ended June 30, 2022 and decreased FFO attributable to common stockholders for the six months ended June 30, 2021 by $9.4 million, or $0.05 per diluted share.

Core FFO attributable to common stockholders, which excludes the impact of the non-core items listed on page 9, was $108.2 million, or $0.49 per diluted share, for the six months ended June 30, 2022, compared to $98.2 million, or $0.45 per diluted share, for the six months ended June 30, 2021.

Portfolio Operations

Quarter Ended June 30, 2022

Same Store Cash NOI increased by $5.1 million, or 5.6%, to $96.8 million for the quarter ended June 30, 2022 from $91.7 million for the quarter ended June 30, 2021. Same Store NOI increased by $8.5 million, or 9.0%, to $102.8 million for the quarter ended June 30, 2022 from $94.3 million for the quarter ended June 30, 2021.

During the quarter ended June 30, 2022, the Company leased 250,231 square feet, of which the Company’s share was 188,175 square feet that was leased at a weighted average initial rent of $78.28 per square foot. This leasing activity, partially offset by lease expirations in the quarter, increased leased occupancy by 80 basis points to 91.4% at June 30, 2022 from 90.6% at March 31, 2022. Same store leased occupancy (properties owned by the Company in a similar manner during both reporting periods), increased by 90 basis points to 91.4% at June 30, 2022 from 90.5% at March 31, 2022. Of the 188,175 square feet leased, 96,052 square feet represented the Company’s share of second generation space (space that had been vacant for less than twelve months) for which rental rates decreased by 5.3% on a cash basis and increased 0.5% on a GAAP basis. The weighted average lease term for leases signed during the second quarter was 9.0 years and weighted average tenant improvements and leasing commissions on these leases were $10.43 per square foot per annum, or 13.3% of initial rent.

Six Months Ended June 30, 2022

Same Store Cash NOI increased by $8.7 million, or 4.7%, to $192.8 million for the six months ended June 30, 2022 from $184.1 million for the six months ended June 30, 2021. Same Store NOI increased by $5.9 million, or 3.0%, to $199.0 million for the six months ended June 30, 2022 from $193.1 million for the six months ended June 30, 2021.

During the six months ended June 30, 2022, the Company leased 453,051 square feet, of which the Company’s share was 340,377 square feet that was leased at a weighted average initial rent of $73.54 per square foot. This leasing activity, partially offset by lease expirations in the six months, increased leased occupancy by 70 basis points to 91.4% at June 30, 2022 from 90.7% at December 31, 2021. Same store leased occupancy (properties owned by the Company in a similar manner during both reporting periods), increased by 80 basis points to 91.4% at June 30, 2022 from 90.6% at December 31, 2021. Of the 340,377 square feet leased, 237,321 square feet represented the Company’s share of second generation space (space that had been vacant for less than twelve months) for which rental rates decreased by 2.5% on a cash basis and remained in-line with prior rental rates on a GAAP basis. The weighted average lease term for leases signed during the six months was 8.5 years and weighted average tenant improvements and leasing commissions on these leases were $9.59 per square foot per annum, or 13.0% of initial rent.

Guidance

The Company is raising its Estimated Core FFO Guidance for the full year of 2022, which is reconciled below to estimated net (loss) income attributable to common stockholders per diluted share in accordance with GAAP. The Company estimates that earnings attributable to common stockholders will be between a net loss of $0.01 per diluted share and net income of $0.03 per diluted share, compared to its prior estimated range of net loss attributable to common stockholders of $0.05 and $0.01 per diluted share, an increase in net income of $0.04 per diluted share at the midpoint of the Company’s prior estimate, resulting from (i) $0.01 per diluted share from better than expected portfolio operations, (ii) $0.01 per diluted share from higher straight line rental income, (iii) $0.01 per diluted share from lower interest expense and (iv) $0.02 per diluted share from lower depreciation expense, partially offset by (v) $0.01 per diluted share from higher general and administrative expenses. The estimated net (loss) income attributable to common stockholders per diluted share is not a projection and is being provided solely to satisfy the disclosure requirements of the U.S. Securities and Exchange Commission.

Based on the Company’s performance for the six months ended June 30, 2022, and its outlook for the remainder of 2022, the Company is raising its Estimated 2022 Core FFO to be between $0.95 and $0.99 per diluted share, compared to its prior estimate of $0.93 to $0.97 per diluted share. This represents an increase of $0.02 per diluted share at the midpoint of the Company’s guidance, resulting primarily from (i) $0.01 per diluted share from better than expected portfolio operations, (ii) $0.01 per diluted share from higher straight line rental income, and (iii) $0.01 per diluted share from lower interest expense, partially offset by, (iv) $0.01 per diluted share from higher general and administrative expenses.

 

 

 

 

 

 

 

Full Year 2022

(Amounts per diluted share)

Low

 

High

Estimated net (loss) income attributable to common stockholders

$

(0.01

)

 

$

0.03

 

Pro rata share of real estate depreciation and amortization, including

the Company's share of unconsolidated joint ventures

 

0.96

 

 

 

0.96

 

Estimated Core FFO

$

0.95

 

 

$

0.99

 

Except as described above, these estimates reflect management’s view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels and the earnings impact of the events referenced in this release and otherwise to be referenced during the conference call referred to on page 6. These estimates do not include the impact on operating results from possible future property acquisitions or dispositions, or realized and unrealized gains and losses on real estate fund investments. The estimates set forth above may be subject to fluctuations as a result of several factors, including the negative impact of the COVID-19 global pandemic. There can be no assurance that the Company’s actual results will not differ materially from the estimates set forth above.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects” and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance or achievements. These factors include, without limitation, the negative impact of the COVID-19 global pandemic on the U.S., regional and global economies and our tenants’ financial condition and results of operations; the ability to enter into new leases or renew leases on favorable terms; dependence on tenants’ financial condition; trends in the office real estate industry including telecommuting, flexible work schedules, open workplaces and teleconferencing; the uncertainties of real estate development, acquisition and disposition activity; the ability to effectively integrate acquisitions; fluctuations in interest rates and the costs and availability of financing; the ability of our joint venture partners to satisfy their obligations; the effects of local, national and international economic and market conditions and the impact of rising inflation and interest rates on such market conditions; the effects of acquisitions, dispositions and possible impairment charges on our operating results; regulatory changes, including changes to tax laws and regulations; and other risks and uncertainties detailed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission. The Company does not undertake a duty to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

FFO is a supplemental measure of our performance. We present FFO in accordance with the definition adopted by the National Association of Real Estate Investment Trusts (“Nareit”). Nareit defines FFO as net income or loss, calculated in accordance with GAAP, adjusted to exclude depreciation and amortization from real estate assets, impairment losses on certain real estate assets and gains or losses from the sale of certain real estate assets or from change in control of certain real estate assets, including our share of such adjustments of unconsolidated joint ventures. FFO is commonly used in the real estate industry to assist investors and analysts in comparing results of real estate companies because it excludes the effect of real estate depreciation and amortization and net gains on sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time, rather than fluctuating based on existing market conditions. In addition, we present Core FFO as an alternative measure of our operating performance, which adjusts FFO for certain other items that we believe enhance the comparability of our FFO across periods. Core FFO, when applicable, excludes the impact of certain items, including, transaction related costs, realized and unrealized gains or losses on real estate fund investments, unrealized gains or losses on interest rate swaps, severance costs and gains or losses on early extinguishment of debt, in order to reflect the Core FFO of our real estate portfolio and operations. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.

FFO and Core FFO are presented as supplemental financial measures and do not fully represent our operating performance. Other REITs may use different methodologies for calculating FFO and Core FFO or use other definitions of FFO and Core FFO and, accordingly, our presentation of these measures may not be comparable to other real estate companies. Neither FFO nor Core FFO is intended to be a measure of cash flow or liquidity. Please refer to our financial statements, prepared in accordance with GAAP, for purposes of evaluating our financial condition, results of operations and cash flows.

NOI is used to measure the operating performance of our properties. NOI consists of rental revenue (which includes property rentals, tenant reimbursements and lease termination income) and certain other property-related revenue less operating expenses (which includes property-related expenses such as cleaning, security, repairs and maintenance, utilities, property administration and real estate taxes). We also present Cash NOI which deducts from NOI, straight-line rent adjustments and the amortization of above and below-market leases, including our share of such adjustments of unconsolidated joint ventures. In addition, we present PGRE's share of NOI and Cash NOI which represents our share of NOI and Cash NOI of consolidated and unconsolidated joint ventures, based on our percentage ownership in the underlying assets. We use NOI and Cash NOI internally as performance measures and believe they provide useful information to investors regarding our financial condition and results of operations because they reflect only those income and expense items that are incurred at property level.

Same Store NOI is used to measure the operating performance of properties in our New York and San Francisco portfolios that were owned by the Company in a similar manner during both the current period and prior reporting periods and represents Same Store NOI from consolidated and unconsolidated joint ventures based on our percentage ownership in the underlying assets. Same Store NOI also excludes lease termination income, impairment of receivables arising from operating leases and certain other items that may vary from period to period. We also present Same Store Cash NOI, which excludes the effect of non-cash items such as the straight-line rent adjustments and the amortization of above and below-market leases.

A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure can be found in this press release and in our Supplemental Information for the quarter ended June 30, 2022, which is available on our website.

Investor Conference Call and Webcast

The Company will host a conference call and audio webcast on Wednesday, July 27, 2022 at 12:00 p.m. Eastern Time (ET), during which management will discuss the second quarter results and provide commentary on business performance. A question and answer session with analysts and investors will follow the prepared remarks.

The conference call can be accessed by dialing 877-407-0789 (domestic) or 201-689-8562 (international). An audio replay of the conference call will be available from 3:00 p.m. ET on July 27, 2022 through August 3, 2022 and can be accessed by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the passcode 13729527.

A live audio webcast of the conference call will be available through the “Investors” section of the Company’s website, www.pgre.com. A replay of the webcast will be archived on the Company’s website.

About Paramount Group, Inc.

Headquartered in New York City, Paramount Group, Inc. is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York City and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.

Paramount Group, Inc.

Consolidated Balance Sheets

(Unaudited and in thousands)

 

Assets:

 

June 30, 2022

 

December 31, 2021

Real estate, at cost:

 

 

 

 

 

 

 

 

Land

 

$

1,966,237

 

 

$

1,966,237

 

Buildings and improvements

 

 

6,103,782

 

 

 

6,061,824

 

 

 

 

8,070,019

 

 

 

8,028,061

 

Accumulated depreciation and amortization

 

 

(1,199,035

)

 

 

(1,112,977

)

Real estate, net

 

 

6,870,984

 

 

 

6,915,084

 

Cash and cash equivalents

 

 

506,933

 

 

 

524,900

 

Restricted cash

 

 

24,934

 

 

 

4,766

 

Investments in unconsolidated joint ventures

 

 

429,418

 

 

 

408,096

 

Investments in unconsolidated real estate funds

 

 

14,156

 

 

 

11,421

 

Accounts and other receivables

 

 

17,788

 

 

 

15,582

 

Deferred rent receivable

 

 

336,736

 

 

 

332,735

 

Deferred charges, net

 

 

119,431

 

 

 

122,177

 

Intangible assets, net

 

 

104,929

 

 

 

119,413

 

Other assets

 

 

56,920

 

 

 

40,388

 

Total assets

 

$

8,482,229

 

 

$

8,494,562

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Notes and mortgages payable, net

 

$

3,837,968

 

 

$

3,835,620

 

Revolving credit facility

 

 

-

 

 

 

-

 

Accounts payable and accrued expenses

 

 

108,464

 

 

 

116,192

 

Dividends and distributions payable

 

 

18,787

 

 

 

16,895

 

Intangible liabilities, net

 

 

41,119

 

 

 

45,328

 

Other liabilities

 

 

24,537

 

 

 

25,495

 

Total liabilities

 

 

4,030,875

 

 

 

4,039,530

 

Equity:

 

 

 

 

 

 

 

 

Paramount Group, Inc. equity

 

 

3,697,192

 

 

 

3,588,163

 

Noncontrolling interests in:

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

412,189

 

 

 

428,833

 

Consolidated real estate fund

 

 

80,557

 

 

 

81,925

 

Operating Partnership

 

 

261,416

 

 

 

356,111

 

Total equity

 

 

4,451,354

 

 

 

4,455,032

 

Total liabilities and equity

 

$

8,482,229

 

 

$

8,494,562

 

 

Paramount Group, Inc.

Consolidated Statements of Income

(Unaudited and in thousands, except share and per share amounts)

 

 

 

 

 

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

 

 

 

 

June 30,

 

June 30,

 

 

2022

 

2021

 

 

2022

 

2021

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental revenue

 

$

177,243

 

 

$

174,628

 

 

$

347,165

 

 

$

347,774

 

 

Fee and other income

 

 

8,274

 

 

 

7,641

 

 

 

22,037

 

 

 

15,661

 

 

 

Total revenues

 

 

185,517

 

 

 

182,269

 

 

 

369,202

 

 

 

363,435

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating

 

 

67,814

 

 

 

64,072

 

 

 

134,475

 

 

 

130,690

 

 

Depreciation and amortization

 

 

57,398

 

 

 

59,925

 

 

 

113,022

 

 

 

118,230

 

 

General and administrative

 

 

16,706

 

 

 

18,418

 

 

 

32,351

 

 

 

32,782

 

 

Transaction related costs

 

 

159

 

 

 

135

 

 

 

276

 

 

 

416

 

 

 

Total expenses

 

 

142,077

 

 

 

142,550

 

 

 

280,124

 

 

 

282,118

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from unconsolidated joint ventures

 

 

(4,416

)

 

 

(15,717

)

 

 

(9,529

)

 

 

(21,033

)

 

Income from unconsolidated real estate funds

 

 

155

 

 

 

148

 

 

 

325

 

 

 

328

 

 

Interest and other income, net

 

 

796

 

 

 

1,070

 

 

 

1,027

 

 

 

2,372

 

 

Interest and debt expense

 

 

(35,578

)

 

 

(34,914

)

 

 

(69,855

)

 

 

(69,653

)

Net income (loss) before income taxes

 

4,397

 

 

 

(9,694

)

 

 

11,046

 

 

 

(6,669

)

 

Income tax expense

 

 

(359

)

 

 

(434

)

 

 

(886

)

 

 

(1,575

)

Net income (loss)

 

 

4,038

 

 

 

(10,128

)

 

 

10,160

 

 

 

(8,244

)

Less net (income) loss attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

(4,779

)

 

 

(7,428

)

 

 

(8,204

)

 

 

(13,156

)

 

Consolidated real estate fund

 

 

352

 

 

 

29

 

 

 

1,368

 

 

 

(56

)

 

Operating Partnership

 

 

29

 

 

 

1,584

 

 

 

(313

)

 

 

1,935

 

Net (loss) income attributable to common stockholders

 

$

(360

)

 

$

(15,943

)

 

$

3,011

 

 

$

(19,521

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.00

)

 

$

(0.07

)

 

$

0.01

 

 

$

(0.09

)

Diluted 

 

$

(0.00

)

 

$

(0.07

)

 

$

0.01

 

 

$

(0.09

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

222,971,886

 

 

 

218,696,284

 

 

 

220,888,664

 

 

 

218,681,228

 

Diluted

 

 

222,971,886

 

 

 

218,696,284

 

 

 

220,930,019

 

 

 

218,681,228

 

Paramount Group, Inc.

Reconciliation of Net Income (Loss) to FFO and Core FFO

(Unaudited and in thousands, except share and per share amounts)

 

 

 

 

 

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

 

 

 

 

June 30,

 

June 30,

 

 

 

 

 

 

 

2022

 

2021

 

2022

 

2021

Reconciliation of Net Income (Loss) to FFO and Core FFO:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

4,038

 

 

$

(10,128

)

 

$

10,160

 

 

$

(8,244

)

 

Real estate depreciation and amortization (including our share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

of unconsolidated joint ventures)

 

 

67,235

 

 

 

70,264

 

 

 

133,060

 

 

 

139,405

 

 

FFO

 

 

71,273

 

 

 

60,136

 

 

 

143,220

 

 

 

131,161

 

 

Less FFO attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

(13,945

)

 

 

(18,453

)

 

 

(26,460

)

 

 

(33,527

)

 

 

Consolidated real estate fund

 

 

346

 

 

 

29

 

 

 

1,355

 

 

 

(56

)

 

FFO attributable to Paramount Group Operating Partnership

 

 

57,674

 

 

 

41,712

 

 

 

118,115

 

 

 

97,578

 

 

Less FFO attributable to noncontrolling interests in

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Partnership

 

 

(4,352

)

 

 

(3,769

)

 

 

(9,920

)

 

 

(8,761

)

 

FFO attributable to common stockholders

 

$

53,322

 

 

$

37,943

 

 

$

108,195

 

 

$

88,817

 

 

Per diluted share

 

$

0.24

 

 

$

0.17

 

 

$

0.49

 

 

$

0.40

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FFO

 

$

71,273

 

 

$

60,136

 

 

$

143,220

 

 

$

131,161

 

 

Non-core items:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustment to equity in earnings for contributions to

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(distributions from) an unconsolidated joint venture

 

 

168

 

 

 

10,492

 

 

 

(415

)

 

 

9,915

 

 

 

Consolidated real estate fund's share of after-tax net gain

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

on sale of residential condominium units (One Steuart Lane)

 

 

(1,022

)

 

 

-

 

 

 

(1,684

)

 

 

-

 

 

 

Other, net

 

 

1,664

 

 

 

133

 

 

 

3,752

 

 

 

379

 

 

Core FFO

 

 

72,083

 

 

 

70,761

 

 

 

144,873

 

 

 

141,455

 

 

Less Core FFO attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

 

(13,945

)

 

 

(18,453

)

 

 

(26,460

)

 

 

(33,527

)

 

 

Consolidated real estate fund

 

 

(128

)

 

 

29

 

 

 

(287

)

 

 

(56

)

 

Core FFO attributable to Paramount Group Operating Partnership

 

 

58,010

 

 

 

52,337

 

 

 

118,126

 

 

 

107,872

 

 

Less Core FFO attributable to noncontrolling interests in

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Partnership

 

 

(4,377

)

 

 

(4,729

)

 

 

(9,915

)

 

 

(9,692

)

 

Core FFO attributable to common stockholders

 

$

53,633

 

 

$

47,608

 

 

$

108,211

 

 

$

98,180

 

 

Per diluted share

 

$

0.24

 

 

$

0.22

 

 

$

0.49

 

 

$

0.45

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

222,971,886

 

 

 

218,696,284

 

 

 

220,888,664

 

 

 

218,681,228

 

 

Effect of dilutive securities

 

 

26,594

 

 

 

51,117

 

 

 

41,355

 

 

 

50,563

 

 

Denominator for FFO and Core FFO per diluted share

 

 

222,998,480

 

 

 

218,747,401

 

 

 

220,930,019

 

 

 

218,731,791

 

Paramount Group, Inc.

Reconciliation of Net Income (Loss) to Same Store NOI and Same Store Cash NOI

(Unaudited and in thousands)

 

 

 

 

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

 

 

 

June 30,

 

June 30,

 

 

 

 

 

 

2022

 

2021

 

2022

 

2021

Reconciliation of Net Income (Loss) to Same Store NOI

and Same Store Cash NOI:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

4,038

 

 

$

(10,128

)

 

$

10,160

 

 

$

(8,244

)

 

Add (subtract) adjustments to arrive at NOI and Cash NOI:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

57,398

 

 

 

59,925

 

 

 

113,022

 

 

 

118,230

 

 

 

General and administrative

 

16,706

 

 

 

18,418

 

 

 

32,351

 

 

 

32,782

 

 

 

Interest and debt expense

 

35,578

 

 

 

34,914

 

 

 

69,855

 

 

 

69,653

 

 

 

Income tax expense

 

359

 

 

 

434

 

 

 

886

 

 

 

1,575

 

 

 

NOI from unconsolidated joint ventures (excluding

One Steuart Lane)

 

11,585

 

 

 

10,557

 

 

 

22,819

 

 

 

20,883

 

 

 

Loss from unconsolidated joint ventures

 

4,416

 

 

 

15,717

 

 

 

9,529

 

 

 

21,033

 

 

 

Fee income

 

(5,974

)

 

 

(6,201

)

 

 

(17,962

)

 

 

(12,871

)

 

 

Interest and other income, net

 

(796

)

 

 

(1,070

)

 

 

(1,027

)

 

 

(2,372

)

 

 

Other, net

 

4

 

 

 

(13

)

 

 

(49

)

 

 

88

 

 

NOI

 

123,314

 

 

 

122,553

 

 

 

239,584

 

 

 

240,757

 

 

Less NOI attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

(21,796

)

 

 

(26,233

)

 

 

(42,118

)

 

 

(48,958

)

 

 

Consolidated real estate fund

 

-

 

 

 

121

 

 

 

-

 

 

 

206

 

 

PGRE's share of NOI

 

101,518

 

 

 

96,441

 

 

 

197,466

 

 

 

192,005

 

 

 

Acquisitions / Redevelopment

 

(164

)

 

 

(231

)

 

 

(211

)

 

 

(231

)

 

 

Lease termination income

 

(157

)

 

 

(1,614

)

 

 

(1,875

)

 

 

(1,712

)

 

 

Other, net

 

1,578

 

 

 

(294

)

 

 

3,577

 

 

 

3,044

 

 

PGRE's share of Same Store NOI

$

102,775

 

 

$

94,302

 

 

$

198,957

 

 

$

193,106

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI

$

123,314

 

 

$

122,553

 

 

$

239,584

 

 

$

240,757

 

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Straight-line rent adjustments (including our share

of unconsolidated joint ventures)

 

(5,977

)

 

 

(2,958

)

 

 

(4,319

)

 

 

(11,060

)

 

 

Amortization of above and below-market leases, net

(including our share of unconsolidated joint ventures)

 

(1,128

)

 

 

(1,662

)

 

 

(2,325

)

 

 

(3,465

)

 

Cash NOI

 

116,209

 

 

 

117,933

 

 

 

232,940

 

 

 

226,232

 

 

Less Cash NOI attributable to noncontrolling interests in:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated joint ventures

 

(20,693

)

 

 

(24,198

)

 

 

(41,206

)

 

 

(43,139

)

 

 

Consolidated real estate fund

 

-

 

 

 

121

 

 

 

-

 

 

 

206

 

 

PGRE's share of Cash NOI

 

95,516

 

 

 

93,856

 

 

 

191,734

 

 

 

183,299

 

 

 

Acquisitions / Redevelopment

 

(176

)

 

 

(287

)

 

 

(242

)

 

 

(287

)

 

 

Lease termination income

 

(157

)

 

 

(1,614

)

 

 

(1,875

)

 

 

(1,712

)

 

 

Other, net

 

1,608

 

 

 

(271

)

 

 

3,211

 

 

 

2,835

 

 

PGRE's share of Same Store Cash NOI

$

96,791

 

 

$

91,684

 

 

$

192,828

 

 

$

184,135

 

 

Contacts

Wilbur Paes

Chief Operating Officer,

Chief Financial Officer and Treasurer

212-237-3122

ir@pgre.com

Tom Hennessy

Vice President, Investor Relations and

Business Development

212-237-3138

ir@pgre.com

Media:

212-492-2285

pr@pgre.com

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