Exhibit 99.2
| 聯繫方式： | 發佈時間: | ||||
| Jeffrey Kuehling | 2024年10月28日 | ||||
| 執行副總裁， | |||||
| 首席財務官 | |||||
| (310) 481-8440 | |||||
| 或者 | |||||
| Taylor Friend | |||||
| 高級副總裁 | |||||
| 資本市場和財務主管 | |||||
| (310) 481-8574 | |||||
Kilroy房地產公司報告
第三章 季度財務業績
---------------
2024年10月28日，洛杉磯 - 基羅伊房地產公司 （紐交所：KRC） 今日報告了截至2024年9月30日的第三季度財務業績。 2024年9月30日結束的季度。
淨收入爲$2580萬，環比下降80％，同比下降71％；
•截至2024年9月30日的季度，收入增長了2.2%，從2023年9月30日的28360萬美元增至28990萬美元
•普通股東每股攤薄淨利潤爲0.44美元，而截至2023年9月30日的季度每股攤薄淨利潤爲0.45美元
•普通股東和受益人可用於營運活動的資金（「FFO」）爲1.404億美元，每股稀釋後1.17美元，比2023年9月30日結束的季度的1.34億美元，每股稀釋後1.12美元增長了4.5%。
「我很高興報告說，我們的平台在過去的一個季度中表現強勁，我們在市場復甦的過程中繼續保持着良好的勢頭。」首席執行官安吉拉·阿曼評論道。「除了本季度租賃活動穩固外，我們在資本配置方面也非常活躍，收購位於聖地亞哥One Paseo綜合項目旁戰略位置的一個小型辦公園區。」
租賃和入住
•2024年9月30日，穩定的投資組合佔84.3%，出租率爲85.8%
•截至2024年9月30日的季度結束時，簽訂了約436,000平方英尺的租賃協議，包括之前空置空間的48,000平方英尺新租賃、當前佔用空間的38,000平方英尺新租賃以及350,000平方英尺的續租。
◦控制支出，同時繼續在我們認爲對長期成功至關重要的領域進行投資。包括209,000平方英尺的短期租賃，主要由198,000平方英尺的短期續租租賃組成
•2024年9月30日結束的季度，dermtech在2024年6月30日結束的季度申請破產，拒絕了其租賃協議，Kilroy執行了一份110,000平方英尺的短期租賃協議。
1
與繼任實體簽訂租賃協議，以促進dermtech的臨時運營。此租賃已從上述租賃生產統計數據中排除
•2024年9月30日結束的季度，根據通用會計準則，已簽訂租賃合同的租金增加了26.0％，現金租金相較於二代租賃的先前水平增加了7.1％，不包括短期租賃
收購活動
•在九月，以3,500萬美元完成了對Del Mar的Junction的收購，這是一個約104,000平方英尺的辦公樓，由聖地亞哥的Del Mar區域的兩棟建築組成。這兩棟建築毗鄰公司的One Paseo綜合項目，96%的出租率，加權平均租賃期限爲4.7年。
資產負債表 / 流動性
•九月份，償還了12000萬美元期貸款的全部未償金額，該貸款最初到期日爲2024年10月3日。
•截至2024年9月30日，公司總流動資金約爲17億美元，包括約6億美元現金和約11億美元可用於完全未使用的無擔保循環信貸額度。
分紅
•董事會宣佈並支付了每股$0.54的常季度現金股息，相當於年利率$2.16
•股息於2024年10月9日支付給2024年9月30日持股人（除息日）
2
普通股股東可獲淨利潤 / FFO指引和展望
公司爲2024年整年提供了更新的每股攤薄FFO指引，範圍爲每股4.38美元至4.44美元，其中點爲每股4.41美元。
| 2024年全年區間 截至2024年7月 | 2024年全年區間 截至2024年10月 | ||||||||||||||||||||||||||||
| 最底線 | 最高線 | 最底線 | 最高線 | ||||||||||||||||||||||||||
| $和每股/每單位以千爲單位，除每股/每單位金額外 | |||||||||||||||||||||||||||||
| 普通股東可獲得的稀釋後每股淨利潤 | $ | 1.50 | $ | 1.59 | $ | 1.61 | $ | 1.66 | |||||||||||||||||||||
稀釋後加權平均普通股份 (1) | 118,000 | 118,000 | 118,150 | 118,150 | |||||||||||||||||||||||||
| 淨利潤可供普通股股東分配 | $ | 177,000 | $ | 188,000 | $ | 190,000 | $ | 196,000 | |||||||||||||||||||||
| 調整： | |||||||||||||||||||||||||||||
| 歸屬於經營合夥企業非控制普通單位的淨利潤 | 1,800 | 1,900 | 1,900 | 2,000 | |||||||||||||||||||||||||
| 合併物業合作伙伴公司歸屬於非控股權益的淨利潤 | 20,500 | 21,000 | 20,250 | 20,750 | |||||||||||||||||||||||||
| 房地產資產的折舊和攤銷 | 338,000 | 339,000 | 346,000 | 347,000 | |||||||||||||||||||||||||
| 銷售可折舊房地產的收益 | — | — | — | — | |||||||||||||||||||||||||
| 在合併財產合作伙伴關係中歸屬於非控股權益的經營資金 | (31,500) | (32,000) | (31,500) | (32,000) | |||||||||||||||||||||||||
營業資金(2) | $ | 505,800 | $ | 517,900 | $ | 526,650 | $ | 533,750 | |||||||||||||||||||||
稀釋後加權平均普通股/單位 (3) | 120,200 | 120,200 | 120,250 | 120,250 | |||||||||||||||||||||||||
普通股/單位的經營活動資金淨額-稀釋後 (3) | $ | 4.21 | $ | 4.31 | $ | 4.38 | $ | 4.44 | |||||||||||||||||||||
| 關鍵假設 | 2024年7月假設 | 2024年10月假設 | ||||||||||||||||||
同店現金淨營業收入的變動 (4) | (-3.0%)至(-4.0%) | (-1.5%)至(-2.0%) | ||||||||||||||||||
| 平均全年入住率 | 82.75%至83.75% | 83.75% 到 84.25% | ||||||||||||||||||
| 一般及管理費用 | $7200萬 到 $8000萬 | $7400萬 到 $7600萬 | ||||||||||||||||||
總體發展支出 (5) | $22500萬 到 $27500萬 | $25000萬 到 $27500萬 | ||||||||||||||||||
加權平均普通股/單位-攤薄 （以千爲單位） (3) | 120,200 | 120,225 | ||||||||||||||||||
________________________
(1)根據估計的加權平均股本進行計算，包括非參與股權獎勵和有表決權的股份的攤薄影響。
(2)請查閱年度報告末尾的經營報告中有關所有基金類型運營資金的說明。
(3)基於加權平均股本計算，包括參與和非參與的股權獎勵，以及有條件發行股份的攤薄影響，假定所有普通有限合夥單位全部交換。報告金額歸屬於普通股股東、普通單位持有人和受限制股份單位持有人。
(4)請查閱我們附在新聞稿8-k表格中的補充財務報告第32頁，了解同店現金淨營業收入的管理聲明。
(5)2024年剩餘的開發支出爲5000萬至7500萬美元。
公司對2024財年的指導預估以及每股普通股持有人可獲利淨額 - 攤薄以及每股和每單位FFO的和解 - 攤薄，均包含在本新聞稿中，反映管理層對當前和未來市場條件的看法，包括對出租率、入住率以及本新聞稿提及事件的收益影響的假設。 這些指導預估不包括公司的運營結果受未來潛在收購、處置（包括任何相關盈利或虧損）、資本市場活動、減值損失或公司無法控制的任何事件影響，因爲在提供指導時這些事件的時間和規模尚不確定。 不能保證公司的實際結果不會與這些預估存在重大差異。
3
Conference Call and Audio Webcast
The Company’s management will discuss third quarter results and the current business environment during the Company’s October 29, 2024 earnings conference call. The call will begin at 10:00 a.m. Pacific Time and last approximately one hour. To participate and obtain conference call dial-in details, register by using the following link, https://www.netroadshow.com/events/login?show=f1c41247&confId=58186. Those interested in listening via the Internet can access the conference call at https://events.q4inc.com/attendee/193901324. It may be necessary to download audio software to hear the conference call.
About Kilroy Realty Corporation
Kilroy Realty Corporation (NYSE: KRC, the “Company”, “Kilroy”) is a leading U.S. landlord and developer, with operations in San Diego, Los Angeles, the San Francisco Bay Area, Seattle, and Austin. The Company has earned global recognition for sustainability, building operations, innovation, and design. As a pioneer and innovator in the creation of a more sustainable real estate industry, the Company’s approach to modern business environments helps drive creativity and productivity for some of the world’s leading technology, entertainment, life science, and business services companies.
The Company is a publicly traded real estate investment trust (“REIT”) and member of the S&P MidCap 400 Index with more than seven decades of experience developing, acquiring, and managing office, life science, and mixed-use projects.
As of September 30, 2024, Kilroy’s stabilized portfolio totaled approximately 17.1 million square feet of primarily office and life science space that was 84.3% occupied and 85.8% leased. The Company also had approximately 1,000 residential units in Hollywood and San Diego, which had a quarterly average occupancy of 92.0%. In addition, the Company had two life science redevelopment projects in the tenant improvement phase totaling approximately 100,000 square feet with total estimated redevelopment costs of $80.0 million and one approximately 875,000 square foot in-process development project with a total estimated investment of $1.0 billion.
A Leader in Sustainability and Commitment to Corporate Social Responsibility
Kilroy has a longstanding commitment to sustainability and continues to be a recognized leader in our sector. For over a decade, the Company and its sustainability initiatives have been recognized with numerous honors, including earning the GRESB five star rating and being named a sector and regional leader in the Americas. Other honors have included the Nareit Leader in the Light Award, being listed on the Dow Jones Sustainability World Index, being named ENERGY STAR Partner of the Year, and receiving the ENERGY STAR highest honor of Sustained Excellence.
Kilroy is proud to have achieved carbon neutral operations across our portfolio since 2020. The Company also has a longstanding commitment to maintain high levels of LEED, Fitwel, and ENERGY STAR certifications across the portfolio.
A significant part of the Company’s foundation is its commitment to enhancing employee growth, satisfaction, and wellness while maintaining a diverse and thriving culture. For four consecutive years, the Company has been named to Bloomberg’s Gender Equality Index, which recognizes companies committed to supporting gender equality through policy development, representation, and transparency.
More information is available at http://www.kilroyrealty.com.
4
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on our current expectations, beliefs, and assumptions, and are not guarantees of future performance. Forward-looking statements are inherently subject to uncertainties, risks, changes in circumstances, trends, and factors that are difficult to predict, many of which are outside of our control. Accordingly, actual performance, results, and events may vary materially from those indicated or implied in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future performance, results, or events. Numerous factors could cause actual future performance, results, and events to differ materially from those indicated in the forward-looking statements, including, among others: global market and general economic conditions, including periods of heightened inflation, and their effect on our liquidity and financial conditions and those of our tenants; adverse economic or real estate conditions generally, and specifically, in the States of California, Texas, and Washington; risks associated with our investment in real estate assets, which are illiquid, and with trends in the real estate industry; defaults on or non-renewal of leases by tenants; any significant downturn in tenants’ businesses, including bankruptcy, lack of liquidity or lack of funding, and the impact labor disruptions or strikes, such as episodic strikes in the entertainment industry, may have on our tenants’ businesses; our ability to re-lease property at or above current market rates; reduced demand for office space, including as a result of remote working and flexible working arrangements that allow work from remote locations other than an employer's office premises; costs to comply with government regulations, including environmental remediation; the availability of cash for distribution and debt service, and exposure to risk of default under debt obligations; increases in interest rates and our ability to manage interest rate exposure; changes in interest rates and the availability of financing on attractive terms or at all, which may adversely impact our future interest expense and our ability to pursue development, redevelopment, and acquisition opportunities and refinance existing debt; a decline in real estate asset valuations, which may limit our ability to dispose of assets at attractive prices, or obtain or maintain debt financing, and which may result in write-offs or impairment charges; significant competition, which may decrease the occupancy and rental rates of properties; potential losses that may not be covered by insurance; the ability to successfully complete acquisitions and dispositions on announced terms; the ability to successfully operate acquired, developed, and redeveloped properties; the ability to successfully complete development and redevelopment projects on schedule and within budgeted amounts; delays or refusals in obtaining all necessary zoning, land use, and other required entitlements, governmental permits and authorizations for our development and redevelopment properties; increases in anticipated capital expenditures, tenant improvement, and/or leasing costs; defaults on leases for land on which some of our properties are located; adverse changes to, or enactment or implementations of, tax laws or other applicable laws, regulations, or legislation, as well as business and consumer reactions to such changes; risks associated with joint venture investments, including our lack of sole decision-making authority, our reliance on co-venturers’ financial condition, and disputes between us and our co-venturers; environmental uncertainties and risks related to natural disasters; risks associated with climate change and our sustainability strategies, and our ability to achieve our sustainability goals; and our ability to maintain our status as a REIT. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. For a discussion of additional factors that could materially adversely affect our business and financial performance, see the factors included under the caption “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2023, and our other filings with the Securities and Exchange Commission. All forward-looking statements are based on currently available information and speak only as of the dates on which they are made. We assume no obligation to update any forward-looking statement made in this press release that becomes untrue because of subsequent events, new information, or otherwise, except to the extent we are required to do so in connection with our ongoing requirements under federal securities laws.
5
KILROY REALTY CORPORATION
SUMMARY OF QUARTERLY RESULTS
(unaudited; in thousands, except per share data)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Revenues | $ | 289,938 | $ | 283,594 | $ | 849,250 | $ | 860,678 | |||||||||||||||
| Net income available to common stockholders | $ | 52,378 | $ | 52,762 | $ | 151,509 | $ | 164,957 | |||||||||||||||
| Weighted average common shares outstanding – basic | 117,830 | 117,185 | 117,516 | 117,133 | |||||||||||||||||||
| Weighted average common shares outstanding – diluted | 118,244 | 117,495 | 117,955 | 117,411 | |||||||||||||||||||
| Net income available to common stockholders per share – basic | $ | 0.44 | $ | 0.45 | $ | 1.27 | $ | 1.40 | |||||||||||||||
| Net income available to common stockholders per share – diluted | $ | 0.44 | $ | 0.45 | $ | 1.27 | $ | 1.40 | |||||||||||||||
Funds From Operations (1)(2) | $ | 140,448 | $ | 134,047 | $ | 406,758 | $ | 421,859 | |||||||||||||||
Weighted average common shares/units outstanding – basic (3) | 119,702 | 118,934 | 119,798 | 118,894 | |||||||||||||||||||
Weighted average common shares/units outstanding – diluted (4) | 120,115 | 119,245 | 120,237 | 119,172 | |||||||||||||||||||
Funds From Operations per common share/unit – basic (2) | $ | 1.17 | $ | 1.13 | $ | 3.40 | $ | 3.55 | |||||||||||||||
Funds From Operations per common share/unit – diluted (2) | $ | 1.17 | $ | 1.12 | $ | 3.38 | $ | 3.54 | |||||||||||||||
| Common shares outstanding at end of period | 118,047 | 117,240 | |||||||||||||||||||||
| Common partnership units outstanding at end of period | 1,151 | 1,151 | |||||||||||||||||||||
| Total common shares and units outstanding at end of period | 119,198 | 118,391 | |||||||||||||||||||||
| September 30, 2024 | September 30, 2023 | ||||||||||||||||||||||
Stabilized office portfolio occupancy rates: (5) | |||||||||||||||||||||||
| Los Angeles | 76.7 | % | 81.2 | % | |||||||||||||||||||
| San Diego | 87.9 | % | 86.1 | % | |||||||||||||||||||
| San Francisco Bay Area | 91.1 | % | 91.1 | % | |||||||||||||||||||
| Seattle | 80.4 | % | 83.5 | % | |||||||||||||||||||
| Austin | 74.2 | % | — | % | |||||||||||||||||||
| Weighted average total | 84.3 | % | 86.2 | % | |||||||||||||||||||
Total square feet of stabilized office properties owned at end of period: (5) | |||||||||||||||||||||||
| Los Angeles | 4,338 | 4,345 | |||||||||||||||||||||
| San Diego | 2,877 | 2,770 | |||||||||||||||||||||
| San Francisco Bay Area | 6,171 | 6,170 | |||||||||||||||||||||
| Seattle | 2,996 | 3,000 | |||||||||||||||||||||
| Austin | 759 | — | |||||||||||||||||||||
| Total | 17,141 | 16,285 | |||||||||||||||||||||
________________________
(1)Reconciliation of Net income available to common stockholders to Funds From Operations available to common stockholders and unitholders and management statement on Funds From Operations are included after the Consolidated Statements of Operations.
(2)Reported amounts are attributable to common stockholders, common unitholders and restricted stock unitholders.
(3)Calculated based on weighted average shares outstanding, including participating share-based awards (i.e. nonvested stock and certain time-based restricted stock units) and assuming the exchange of all common limited partnership units outstanding.
(4)Calculated based on weighted average shares outstanding, including participating and non-participating share-based awards, dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding.
(5)Occupancy percentages and total square feet reported are based on the Company’s stabilized office portfolio for the periods presented.
6
KILROY REALTY CORPORATION
CONSOLIDATED BALANCE SHEETS
(unaudited; in thousands)
| September 30, 2024 | December 31, 2023 | ||||||||||
| ASSETS | |||||||||||
| REAL ESTATE ASSETS: | |||||||||||
| Land and improvements | $ | 1,750,820 | $ | 1,743,170 | |||||||
| Buildings and improvements | 8,573,332 | 8,463,674 | |||||||||
| Undeveloped land and construction in progress | 2,254,628 | 2,034,804 | |||||||||
| Total real estate assets held for investment | 12,578,780 | 12,241,648 | |||||||||
| Accumulated depreciation and amortization | (2,747,494) | (2,518,304) | |||||||||
| Total real estate assets held for investment, net | 9,831,286 | 9,723,344 | |||||||||
| Cash and cash equivalents | 625,395 | 510,163 | |||||||||
| Marketable securities | 27,144 | 284,670 | |||||||||
| Current receivables, net | 11,218 | 13,609 | |||||||||
| Deferred rent receivables, net | 455,613 | 460,979 | |||||||||
| Deferred leasing costs and acquisition-related intangible assets, net | 226,991 | 229,705 | |||||||||
| Right of use ground lease assets | 129,492 | 125,506 | |||||||||
| Prepaid expenses and other assets, net | 73,495 | 53,069 | |||||||||
| TOTAL ASSETS | $ | 11,380,634 | $ | 11,401,045 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| LIABILITIES: | |||||||||||
| Secured debt, net | $ | 599,478 | $ | 603,225 | |||||||
| Unsecured debt, net | 4,401,678 | 4,325,153 | |||||||||
| Accounts payable, accrued expenses and other liabilities | 354,785 | 371,179 | |||||||||
| Ground lease liabilities | 128,606 | 124,353 | |||||||||
| Accrued dividends and distributions | 64,844 | 64,440 | |||||||||
| Deferred revenue and acquisition-related intangible liabilities, net | 151,670 | 173,638 | |||||||||
| Rents received in advance and tenant security deposits | 71,033 | 79,364 | |||||||||
| Total liabilities | 5,772,094 | 5,741,352 | |||||||||
| EQUITY: | |||||||||||
| Stockholders’ Equity | |||||||||||
| Common stock | 1,181 | 1,173 | |||||||||
| Additional paid-in capital | 5,203,195 | 5,205,839 | |||||||||
| Retained earnings | 175,962 | 221,149 | |||||||||
| Total stockholders’ equity | 5,380,338 | 5,428,161 | |||||||||
| Noncontrolling Interests | |||||||||||
| Common units of the Operating Partnership | 52,441 | 53,275 | |||||||||
| Noncontrolling interests in consolidated property partnerships | 175,761 | 178,257 | |||||||||
| Total noncontrolling interests | 228,202 | 231,532 | |||||||||
| Total equity | 5,608,540 | 5,659,693 | |||||||||
| TOTAL LIABILITIES AND EQUITY | $ | 11,380,634 | $ | 11,401,045 | |||||||
7
KILROY REALTY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; in thousands, except per share data)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| REVENUES | |||||||||||||||||||||||
| Rental income | $ | 285,951 | $ | 280,681 | $ | 836,760 | $ | 852,094 | |||||||||||||||
| Other property income | 3,987 | 2,913 | 12,490 | 8,584 | |||||||||||||||||||
| Total revenues | 289,938 | 283,594 | 849,250 | 860,678 | |||||||||||||||||||
| EXPENSES | |||||||||||||||||||||||
| Property expenses | 63,593 | 59,445 | 180,192 | 168,233 | |||||||||||||||||||
| Real estate taxes | 26,677 | 28,363 | 84,925 | 84,868 | |||||||||||||||||||
| Ground leases | 2,977 | 2,390 | 8,725 | 7,172 | |||||||||||||||||||
General and administrative expenses (1) | 18,066 | 24,761 | 54,596 | 71,356 | |||||||||||||||||||
| Leasing costs | 2,353 | 1,852 | 6,751 | 4,550 | |||||||||||||||||||
| Depreciation and amortization | 91,879 | 85,224 | 267,061 | 269,262 | |||||||||||||||||||
| Total expenses | 205,545 | 202,035 | 602,250 | 605,441 | |||||||||||||||||||
| OTHER INCOME (EXPENSES) | |||||||||||||||||||||||
| Interest income | 9,688 | 7,015 | 32,962 | 11,896 | |||||||||||||||||||
| Interest expense | (36,408) | (29,837) | (112,042) | (81,891) | |||||||||||||||||||
| Total other expenses | (26,720) | (22,822) | (79,080) | (69,995) | |||||||||||||||||||
| NET INCOME | 57,673 | 58,737 | 167,920 | 185,242 | |||||||||||||||||||
| Net income attributable to noncontrolling common units of the Operating Partnership | (509) | (515) | (1,469) | (1,612) | |||||||||||||||||||
| Net income attributable to noncontrolling interests in consolidated property partnerships | (4,786) | (5,460) | (14,942) | (18,673) | |||||||||||||||||||
| Total income attributable to noncontrolling interests | (5,295) | (5,975) | (16,411) | (20,285) | |||||||||||||||||||
| NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 52,378 | $ | 52,762 | $ | 151,509 | $ | 164,957 | |||||||||||||||
| Weighted average shares of common stock outstanding – basic | 117,830 | 117,185 | 117,516 | 117,133 | |||||||||||||||||||
| Weighted average shares of common stock outstanding – diluted | 118,244 | 117,495 | 117,955 | 117,411 | |||||||||||||||||||
| Net income available to common stockholders per share – basic | $ | 0.44 | $ | 0.45 | $ | 1.27 | $ | 1.40 | |||||||||||||||
| Net income available to common stockholders per share – diluted | $ | 0.44 | $ | 0.45 | $ | 1.27 | $ | 1.40 | |||||||||||||||
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(1)The three and nine months ended September 30, 2023 includes $5.8 million and $12.1 million, respectively, of retirement costs for our former CEO and former President, primarily comprised of accelerated stock compensation expense.
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KILROY REALTY CORPORATION
FUNDS FROM OPERATIONS
(unaudited; in thousands, except per share data)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Net income available to common stockholders | $ | 52,378 | $ | 52,762 | $ | 151,509 | $ | 164,957 | |||||||||||||||
| Adjustments: | |||||||||||||||||||||||
| Net income attributable to noncontrolling common units of the Operating Partnership | 509 | 515 | 1,469 | 1,612 | |||||||||||||||||||
| Net income attributable to noncontrolling interests in consolidated property partnerships | 4,786 | 5,460 | 14,942 | 18,673 | |||||||||||||||||||
| Depreciation and amortization of real estate assets | 90,243 | 83,518 | 262,292 | 263,662 | |||||||||||||||||||
| Funds From Operations attributable to noncontrolling interests in consolidated property partnerships | (7,468) | (8,208) | (23,454) | (27,045) | |||||||||||||||||||
Funds From Operations(1)(2)(3) | $ | 140,448 | $ | 134,047 | $ | 406,758 | $ | 421,859 | |||||||||||||||
Weighted average common shares/units outstanding – basic (4) | 119,702 | 118,934 | 119,798 | 118,894 | |||||||||||||||||||
Weighted average common shares/units outstanding – diluted (5) | 120,115 | 119,245 | 120,237 | 119,172 | |||||||||||||||||||
Funds From Operations per common share/unit – basic (2) | $ | 1.17 | $ | 1.13 | $ | 3.40 | $ | 3.55 | |||||||||||||||
Funds From Operations per common share/unit – diluted (2) | $ | 1.17 | $ | 1.12 | $ | 3.38 | $ | 3.54 | |||||||||||||||
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(1)We calculate Funds From Operations available to common stockholders and common unitholders (“FFO”) in accordance with the 2018 Restated White Paper on FFO approved by the Board of Governors of Nareit. The White Paper defines FFO as net income or loss (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO. Our calculation of FFO includes the amortization of deferred revenue related to tenant-funded tenant improvements and excludes the depreciation of the related tenant improvement assets. We also add back net income attributable to noncontrolling common units of the Operating Partnership because we report FFO attributable to common stockholders and common unitholders.
We believe that FFO is a useful supplemental measure of our operating performance. The exclusion from FFO of gains and losses from the sale of operating real estate assets allows investors and analysts to readily identify the operating results of the assets that form the core of our activity and assists in comparing those operating results between periods. Also, because FFO is generally recognized as the industry standard for reporting the operations of REITs, it facilitates comparisons of operating performance to other REITs. However, other REITs may use different methodologies to calculate FFO, and accordingly, our FFO may not be comparable to all other REITs.
Implicit in historical cost accounting for real estate assets in accordance with GAAP is the assumption that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered presentations of operating results for real estate companies using historical cost accounting alone to be insufficient. Because FFO excludes depreciation and amortization of real estate assets, we believe that FFO along with the required GAAP presentations provides a more complete measurement of our performance relative to our competitors and a more appropriate basis on which to make decisions involving operating, financing, and investing activities than the required GAAP presentations alone would provide.
However, FFO should not be viewed as an alternative measure of our operating performance because it does not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, which are significant economic costs and could materially impact our results from operations.
(2)Reported amounts are attributable to common stockholders, common unitholders, and restricted stock unitholders.
(3)FFO available to common stockholders and unitholders includes amortization of deferred revenue related to tenant-funded tenant improvements of $4.2 million and $4.9 million for the three months ended September 30, 2024 and 2023, respectively, and $15.1 million and $15.0 million for the nine months ended September 30, 2024 and 2023, respectively.
(4)Calculated based on weighted average shares outstanding, including participating share-based awards (i.e. certain time-based restricted stock units) and assuming the exchange of all common limited partnership units outstanding.
(5)Calculated based on weighted average shares outstanding, including participating and non-participating share-based awards, dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding.
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