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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Maryland
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95-4502084
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification Number)
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Title of Each Class
Common Stock, $.01 par value per share
6.45% Series E Cumulative Redeemable Preferred Stock
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Name of Each Exchange on Which Registered
New York Stock Exchange
New York Stock Exchange
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Large accelerated filer
x
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a smaller reporting company)
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Smaller reporting company
o
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PART I
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Page
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ITEM 1.
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BUSINESS
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ITEM 1A.
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RISK FACTORS
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ITEM 1B.
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UNRESOLVED STAFF COMMENTS
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ITEM 2.
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PROPERTIES
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ITEM 3.
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LEGAL PROCEEDINGS
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ITEM 4.
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MINE SAFETY DISCLOSURES
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PART II
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ITEM 5.
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MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES
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ITEM 6.
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SELECTED FINANCIAL DATA
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ITEM 7.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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ITEM 7A.
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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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ITEM 8.
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FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
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ITEM 9.
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CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
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ITEM 9A.
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CONTROLS AND PROCEDURES
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ITEM 9B.
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OTHER INFORMATION
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PART III
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ITEM 10.
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DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
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ITEM 11.
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EXECUTIVE COMPENSATION
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ITEM 12.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
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ITEM 13.
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
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ITEM 14.
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PRINCIPAL ACCOUNTANT FEES AND SERVICES
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PART IV
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ITEM 15.
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EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
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ABR
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Annualized Base Rent
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AFFO
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Adjusted Funds from Operations
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ASU
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Accounting Standards Update
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BBA
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British Bankers’ Association
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bps
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Basis Points
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CIP
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Construction in Progress
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EBITDA
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Earnings before Interest, Taxes, Depreciation, and Amortization
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EPS
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Earnings per Share
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FASB
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Financial Accounting Standards Board
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FDIC
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Federal Deposit Insurance Corporation
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FFO
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Funds from Operations
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GAAP
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U.S. Generally Accepted Accounting Principles
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HVAC
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Heating, Ventilation, and Air Conditioning
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IASB
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International Accounting Standards Board
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IFRS
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International Financial Reporting Standards
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IRS
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Internal Revenue Service
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JV
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Joint Venture
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LEED
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Leadership in Energy and Environmental Design
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LIBOR
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London Interbank Offered Rate
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MIT
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Massachusetts Institute of Technology
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NAREIT
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National Association of Real Estate Investment Trusts
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NAV
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Net Asset Value
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NBV
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Net Book Value
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NOI
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Net Operating Income
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NYSE
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New York Stock Exchange
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REIT
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Real Estate Investment Trust
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RSF
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Rentable Square Feet/Foot
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SEC
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Securities and Exchange Commission
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SoMa
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South of Market submarket of the San Francisco Bay Area
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TI
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Tenant Improvement
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U.S.
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United States
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VIE
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Variable Interest Entity
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Proximity to centers of innovation and technological advances;
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Location of the property and our strategy in the relevant market;
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Quality of existing and prospective client tenants;
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Condition and capacity of the building infrastructure;
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Quality and generic characteristics of the improvements;
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Physical condition of the structure and common area improvements;
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Opportunities available for leasing vacant space and for re-tenanting or renewing occupied space;
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Availability of and/or ability to add appropriate tenant amenities;
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Availability of land for future ground-up development of new office/laboratory or tech office space;
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Opportunities to redevelop existing space into higher-rent, generic, and reusable office/laboratory or tech office space;
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The property’s unlevered yields and;
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Our ability to increase the property’s long-term financial returns.
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Maintaining significant liquidity through borrowing capacity under our unsecured senior line of credit, available commitments under secured construction loans, and cash and cash equivalents;
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Minimizing the amount of near-term debt maturities in a single year;
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Maintaining low to modest leverage;
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Minimizing variable interest rate risk;
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Generating high-quality, strong, and increasing operating cash flows;
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Maintaining geographic diversity in stable-value urban intellectual centers of innovation;
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Renewing existing client tenant space at higher rental rates to the extent possible;
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Minimizing tenant improvement costs;
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Improving investment returns through leasing of vacant space and replacing existing client tenants with new client tenants at higher rental rates;
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Maintaining solid occupancy while also maintaining high lease rental rates;
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Realizing contractual rental rate escalations, which are currently provided for in approximately
94%
of our leases (on an RSF basis);
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Implementing effective cost control measures, including negotiating pass-through provisions in client tenant leases for operating expenses and certain capital expenditures;
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Selectively selling real estate assets, including non-income-producing land parcels and non-core/“core-like” operating assets, and investing the proceeds into our highly-leased value-creation development projects;
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Maintaining access to diverse sources of capital;
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Selectively acquiring high-quality office/laboratory and tech office properties in our target urban innovation cluster submarkets at prices that enable us to realize attractive returns;
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Selectively developing properties in our target urban innovation cluster submarkets; and
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Selectively redeveloping existing office, warehouse, or shell space, or newly acquired properties, into generic office/laboratory or tech office space that can be leased at higher rental rates in our target urban innovation cluster submarkets.
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Key Information of Client Tenants
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December 31, 2014
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Total leases
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562
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Total client tenants
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441
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Total properties
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193
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Single-tenant properties
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87
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Percentage of single-tenant properties
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45
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%
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Percentage of aggregate ABR from our three largest client tenants:
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Novartis AG
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6.1
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%
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Illumina, Inc.
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4.9
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%
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New York University
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3.6
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Total percentage of aggregate ABR from our three largest client tenants
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14.6
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%
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We may be unable to acquire a desired property because of competition from other real estate investors with significant capital, including both publicly traded REITs and institutional investment funds;
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Even if we are able to acquire a desired property, competition from other potential acquirers may significantly increase the purchase price or result in other less favorable terms;
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Even if we enter into agreements for the acquisition of properties, these agreements are subject to customary conditions to closing, including completion of due diligence investigations to our satisfaction;
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We may be unable to finance acquisitions on favorable terms or at all;
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We may spend more than budgeted amounts to make necessary improvements or renovations to acquired properties;
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We may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of operating properties or portfolios of properties, into our existing operations, and our results of operations and financial condition could be adversely affected;
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Acquired properties may be subject to reassessment, which may result in higher-than-expected property tax payments;
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Market conditions may result in higher-than-expected vacancy rates and lower-than-expected rental rates; and
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We may acquire properties subject to liabilities and without any recourse, or with only limited recourse, with respect to unknown liabilities such as liabilities for cleanup of undisclosed environmental contamination; claims by client tenants, vendors, or other persons dealing with the former owners of the properties; and claims for indemnification by general partners, directors, officers, and others indemnified by the former owners of the properties.
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We may not complete development or redevelopment projects on schedule or within budgeted amounts;
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We may be unable to lease development or redevelopment projects on schedule or within budgeted amounts;
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We may expend funds on and devote management’s time to development and redevelopment projects that we may not complete;
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We may abandon development or redevelopment projects after we begin to explore them and as a result we may lose deposits or fail to recover costs already incurred;
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Market and economic conditions deteriorate resulting in lower-than-expected rental rates;
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We may face higher operating costs than we anticipated for development or redevelopment projects, including insurance premiums, utilities, real estate taxes, and costs of complying with changes in government regulations;
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We may face higher requirements for capital improvements than we anticipated for development or redevelopment projects, particularly in older structures;
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We may be unable to proceed with development or redevelopment projects because we cannot obtain debt and/or equity financing on favorable terms or at all;
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We may fail to retain client tenants that have pre-leased our development or redevelopment projects if we do not complete the construction of these properties in a timely manner or to the client tenants’ specifications;
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Client tenants that have pre-leased our development or redevelopment projects file for bankruptcy or become insolvent, adversely affecting the income produced by and the value of our properties; or requiring us to change the scope of the project, potentially resulting in higher construction costs and lower financial returns;
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We may encounter delays, refusals, unforeseen cost increases, and other impairments resulting from third-party litigation or severe weather conditions;
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We may encounter delays or refusals in obtaining all necessary zoning, land use, building, occupancy, and other required government permits and authorizations; and
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Development or redevelopment projects may have defects we do not discover through our inspection processes, including latent defects that may not reveal themselves until many years after we put a property in service.
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Our properties may not perform as we expect;
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We may have to lease space at rates below our expectations;
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We may not be able to obtain financing on acceptable terms; and
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We may underestimate the cost of improvements required to maintain or improve space to meet standards established for the market position intended for that property.
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Restrict our ability to incur additional indebtedness;
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Restrict our ability to make certain investments;
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Restrict our ability to merge with another company;
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Restrict our ability to make distributions to stockholders;
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Require us to maintain financial coverage ratios; and
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Require us to maintain a pool of qualified unencumbered assets.
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Our cash flows from operations may not be sufficient to meet required payments of principal and interest;
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We may be forced to dispose of one or more of our properties, possibly on disadvantageous terms, to make payments on our debt;
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If we default on our debt obligations, the lenders or mortgagees may foreclose on our properties that secure those loans;
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A foreclosure on one of our properties could create taxable income without any accompanying cash proceeds to pay the tax;
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A default under a loan that has cross-default provisions may cause us to automatically default on another loan or interest rate hedge agreement;
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We may not be able to refinance or extend our existing debt;
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The terms of any refinancing or extension may not be as favorable as the terms of our existing debt;
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We may be subject to a significant increase in the variable interest rates on our unsecured senior line of credit, unsecured senior bank term loans, and certain other borrowings, which could adversely impact our cash flows and operations; and
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The terms of our debt obligations may require a reduction in our distributions to stockholders.
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National, local, and worldwide economic conditions;
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Competition from other properties;
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Changes in the science and technology industries;
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Real estate conditions in our target markets;
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Our ability to collect rent payments;
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The availability of financing;
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Changes to the financial and banking industries;
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Changes in interest rate levels;
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Vacancies at our properties and our ability to re-lease space;
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Changes in tax or other regulatory laws;
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The costs of compliance with government regulation;
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The lack of liquidity of real estate investments; and
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Increases in operating costs.
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The status of the economy;
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The status of capital markets, including availability and cost of capital;
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Changes in financing terms available to us;
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Negative developments in the operating results or financial condition of client tenants, including, but not limited to, their ability to pay rent;
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Our ability to re-lease space at similar rates as vacancies occur;
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Our ability to reinvest sale proceeds in a timely manner at rates similar to the rate at which assets are sold;
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Regulatory approval and market acceptance of the products and technologies of client tenants;
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Liability or contract claims by or against client tenants;
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Unanticipated difficulties and/or expenditures relating to future acquisitions;
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Environmental laws affecting our properties;
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Changes in rules or practices governing our financial reporting; and
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Other legal and operational matters, including REIT qualification and key management personnel recruitment and retention.
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The availability and cost of debt and/or equity capital;
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The condition of our balance sheet;
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Actual or anticipated capital requirements;
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The condition of the financial and banking industries;
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Actual or anticipated variations in our quarterly operating results or dividends;
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The amount and timing of debt maturities and other contractual obligations;
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Changes in our FFO, AFFO, or earnings estimates;
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The publication of research reports about us, the real estate industry, or the science and technology industries;
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The general reputation of REITs and the attractiveness of their equity securities in comparison to other debt or equity securities (including securities issued by other real estate-based companies);
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General stock and bond market conditions, including changes in interest rates on fixed-income securities, that may lead prospective purchasers of our stock to demand a higher annual yield from future dividends;
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Changes in our analyst ratings;
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Changes in our corporate credit rating or credit ratings of our debt or other securities;
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Changes in market valuations of similar companies;
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Adverse market reaction to any additional debt we incur in the future;
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Additions or departures of key management personnel;
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Actions by institutional stockholders;
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Speculation in the press or investment community;
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Terrorist activity adversely affecting the markets in which our securities trade, possibly increasing market volatility and causing the further erosion of business and consumer confidence and spending;
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Government regulatory action and changes in tax laws;
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The realization of any of the other risk factors included in this annual report on Form 10-K; and
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General market and economic conditions.
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The amount of cash provided by operating activities available for distribution;
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Our financial condition and capital requirements;
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Any decision to reinvest funds rather than to distribute such funds;
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Our capital expenditures;
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The annual distribution requirements under the REIT provisions of the Internal Revenue Code;
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Restrictions under Maryland law; and
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Other factors our Board of Directors deems relevant.
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Adverse effects of changes in exchange rates for foreign currencies;
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Challenges and/or taxation with respect to the repatriation of foreign earnings or repatriation of proceeds from the sale of one or more of our foreign investments;
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Changes in foreign political, regulatory, and economic conditions, including nationally, regionally, and locally;
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Challenges in managing international operations;
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Challenges in hiring or retaining key management personnel;
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Challenges of complying with a wide variety of foreign laws and regulations, including those relating to real estate, corporate governance, operations, taxes, employment, and legal proceedings;
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Differences in lending practices;
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Differences in languages, cultures, and time zones; and
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Changes in applicable laws and regulations in the U.S. that affect foreign operations.
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Upon bankruptcy of non-wholly owned partnerships, limited liability companies, or joint venture entities, we may become liable for the liabilities of the partnership, limited liability company, or joint venture;
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We may share certain approval rights over major decisions with third parties;
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We may be required to contribute additional capital if our partners fail to fund their share of any required capital contributions;
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Our partners, co-members, or joint ventures might have economic or other business interests or goals that are inconsistent with our business interests or goals and that could affect our ability to lease or re-lease the property, operate the property, or our ability to maintain our qualification as a REIT;
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Our ability to sell the interest on advantageous terms when we so desire may be limited or restricted under the terms of our agreements with our partners; and
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We may not continue to own or operate the interests or assets underlying such relationships or may need to purchase such interests or assets at an above market price to continue ownership.
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We would be subject to federal income tax on our taxable income at regular corporate rates;
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We would not be allowed a deduction for distributions to our stockholders in computing taxable income;
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We would be disqualified from treatment as a REIT for the four taxable years following the year during which we lost qualification, unless we were entitled to relief under the Internal Revenue Code; and
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We would no longer be required by the Internal Revenue Code to make any distributions to our stockholders.
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Status as a REIT;
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Incurrence of debt and debt management activities;
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Selective acquisition, disposition, development, and redevelopment activities;
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Stockholder distributions; and
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Other policies, as appropriate.
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Other REITs;
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Insurance companies;
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Pension and investment funds;
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Private equity entities;
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Foreign investors;
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Partnerships;
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Developers;
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Investment companies; and
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Owners/occupants.
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Greater Boston;
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San Francisco Bay Area;
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New York City;
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San Diego;
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Seattle;
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Maryland;
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Research Triangle Park;
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Canada; and
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Asia.
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Reinforced concrete floors;
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Upgraded roof loading capacity;
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Increased floor-to-ceiling heights;
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Heavy-duty HVAC systems;
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Enhanced environmental control technology;
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Significantly upgraded electrical, gas, and plumbing infrastructure; and
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Laboratory benches.
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Drugs that are developed and manufactured by some of our client tenants require regulatory approval, including the approval of the U.S. Food and Drug Administration, prior to being made, marketed, sold, and used. The regulatory approval process to manufacture and market drugs is costly, typically takes several years, requires validation through clinical trials and the use of substantial resources, and is often unpredictable. A client tenant may fail to obtain or may experience significant delays in obtaining these approvals. Even if the client tenant obtains regulatory approvals, marketed products will be subject to ongoing regulatory review and potential loss of approvals.
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The ability of some of our client tenants to commercialize any future products successfully will depend in part on the coverage and reimbursement levels set by government authorities, private health insurers, and other third-party payers. Additionally, reimbursements may decrease in the future.
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Some of our client tenants developing potential products may find that their products are not effective, or even are harmful, when tested in humans.
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Some of our client tenants depend upon the commercial success of certain products. Even if a product made by a client tenant is successfully developed and proven safe and effective in human clinical trials, and the requisite regulatory approvals are obtained, subsequent discovery of safety issues with these products could cause product liability events, additional regulatory scrutiny and requirements for additional labeling, loss of approval, withdrawal of products from the market, and the imposition of fines or criminal penalties.
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A drug made by a client tenant may not be well accepted by doctors and patients, or may be less effective or accepted than a competitor’s drug, even if it is successfully developed.
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The negative results of safety signals arising from the clinical trials of the competitors of our client tenants may prompt regulatory agencies to take actions that may adversely affect the clinical trials or products of our client tenants.
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Some of our client tenants require significant funding to develop and commercialize their products and technologies, which funding must be obtained from venture capital firms; private investors; the public markets; companies in the life science; or federal, state, and local governments. Such funding may become unavailable or difficult to obtain. The ability of each client tenant to raise capital will depend on its financial and operating condition and the overall condition of the financial, banking, and economic environment.
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Even with sufficient funding, some of our client tenants may not be able to discover or identify potential drug targets in humans, or potential drugs for use in humans, or to create tools or technologies that are commercially useful in the discovery or identification of potential drug targets or drugs.
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Some of our client tenants may not be able to successfully manufacture their drugs economically, even if such drugs are proven through human clinical trials to be safe and effective in humans.
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Marketed products also face commercialization risk, and client tenants may never realize projected levels of product utilization or revenues.
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Negative news regarding the products, the clinical trials, or other business developments of our client tenants may cause their stock price or credit profile to deteriorate.
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Our client tenants sell products and services in an industry that is characterized by rapid and significant technological changes, frequent new product and service introductions and enhancements, evolving industry standards, and uncertainty over the implementation of new healthcare reform legislation, which may cause them to lose competitive positions and adversely affect their operations.
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Some of our client tenants and their licensors require patent, copyright, or trade secret protection to develop, make, market, and sell their products and technologies. A client tenant may be unable to commercialize its products or technologies if patents covering such products or technologies are not issued, or are successfully challenged, narrowed, invalidated, or circumvented by third parties, or if the client tenant fails to obtain licenses to the discoveries of third parties necessary to commercialize its products or technologies.
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Many of our client tenants depend upon patents to provide exclusive marketing rights for their products. As their product patents expire, competitors of these client tenants may be able to legally produce and market products similar to those products of our client tenants, which could have a material adverse effect on their sales and results of operations.
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Laws and regulations governing the Internet, e-commerce, electronic devices, and other services are evolving. Existing and future laws and regulations may impede the growth of our technology industry client tenants. These laws and regulations may cover, among other areas, taxation, privacy, data protection, pricing, content, copyrights, distribution, mobile communications, business licensing, and consumer protection.
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The technology industry is characterized by rapid changes in customer requirements and preferences, frequent new product and service introductions, and the emergence of new industry standards and practices. A failure to respond in a timely manner to these market conditions could materially impair the operations of our technology industry client tenants.
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Some of our client tenants depend on continued and unimpeded access to the Internet by users of their products and services, as well as access to mobile networks. Internet service providers and mobile network operators may be able to block, degrade, or charge additional fees to these client tenants or users.
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The Internet has experienced, and is likely to continue to experience, outages and other delays. These outages and delays, as well as problems caused by computer malware, viruses, worms, and similar programs, may materially affect the ability of our technology industry client tenants to conduct business.
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Security breaches or network attacks may delay or interrupt the services provided by our client tenants and could harm their reputations or subject them to significant liability.
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Some of our client tenants require significant funding to develop and commercialize their products and technologies, which funding must be obtained from venture capital firms; private investors; the public markets; companies in the technology industry; or federal, state, and local governments. Such funding may become unavailable or difficult to obtain. The ability of each client tenant to raise capital will depend on its financial and operating condition and the overall condition of the financial, banking, and economic environment.
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Even with sufficient funding, some of our client tenants may not be able to discover or identify potential customers or may not be able to create tools or technologies that are commercially useful.
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Some of our client tenants may not be able to successfully manufacture their products economically.
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Marketed products also face commercialization risk, and client tenants may never realize projected levels of product utilization or revenues.
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Negative news regarding the products or other business developments of our client tenants may cause their stock price or credit profile to deteriorate.
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The products and services provided by some of our client tenants are subject to the threat of piracy and unauthorized copying, and inadequate intellectual property laws and other protections could prevent them from enforcing or defending their proprietary technologies. These client tenants may also face legal risks arising out of user-generated content.
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Trademark, copyright, patent, domain name, trade dress, and trade secret protection is very expensive to maintain and may require our technology industry client tenants to incur significant costs to protect their intellectual property rights.
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The discharge of stormwater, wastewater, and any water pollutants;
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The emission of air pollutants;
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The generation, management, and disposal of hazardous or toxic chemicals, substances, or wastes; and
|
•
|
Workplace health and safety.
|
•
|
Asbestos surveys;
|
•
|
Radon surveys;
|
•
|
Lead surveys;
|
•
|
Mold surveys;
|
•
|
Additional public records review;
|
•
|
Subsurface sampling; and
|
•
|
Other testing.
|
•
|
Significant changes to our balance sheet relating to the recognition of operating leases as assets or liabilities based on existing lease terms and whether we are the lessor or lessee; and
|
•
|
Significant fluctuations in our reported results of operations, including fluctuations in our expenses related to amortization of new lease-related assets and/or liabilities and assumed interest costs with leases.
|
•
|
Disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our client tenants;
|
•
|
Result in misstated financial reports, violations of loan covenants, missed reporting deadlines, and/or missed permitting deadlines;
|
•
|
Result in our inability to properly monitor our compliance with the rules and regulations regarding our qualification as a REIT;
|
•
|
Result in the unauthorized access to, and destruction, loss, theft, misappropriation, or release of proprietary, confidential, sensitive, or otherwise valuable information of ours or others, which others could use to compete against us or for disruptive, destructive, or otherwise harmful purposes and outcomes;
|
•
|
Result in our inability to maintain the building systems relied upon by our client tenants for the efficient use of their leased space;
|
•
|
Require significant management attention and resources to remedy any damages that result;
|
•
|
Subject us to claims for breach of contract, damages, credits, penalties, or termination of leases or other agreements; or
|
•
|
Damage our reputation among our client tenants and investors generally.
|
•
|
Reinforced concrete floors;
|
•
|
Upgraded roof loading capacity;
|
•
|
Increased floor-to-ceiling heights;
|
•
|
Heavy-duty HVAC systems;
|
•
|
Enhanced environmental control technology;
|
•
|
Significantly upgraded electrical, gas, and plumbing infrastructure; and
|
•
|
Laboratory benches.
|
•
|
Investment-grade client tenants represented
56%
of our total ABR;
|
•
|
Approximately
95%
of our leases (on an RSF basis) were triple net leases, requiring client tenants to pay substantially all real estate taxes, insurance, utilities, common area, and other operating expenses (including increases thereto) in addition to base rent;
|
•
|
Approximately
94%
of our leases (on an RSF basis) contained effective annual rent escalations that were either fixed (generally ranging from
3%
to
3.5%
) or indexed based on a consumer price index or other index; and
|
•
|
Approximately
93%
of our leases (on an RSF basis) provided for the recapture of certain capital expenditures (such as HVAC systems maintenance and/or replacement, roof replacement, and parking lot resurfacing) that we believe would typically be borne by the landlord in traditional office leases.
|
|
|
RSF
|
|
Number of Properties
(1)
|
|
ABR
|
|||||||||||||||||||
Market
|
|
Operating
|
|
Development
|
|
Redevelopment
|
|
Total
|
|
% Total
|
|
|
|||||||||||||
Greater Boston
|
|
3,703,238
|
|
|
646,282
|
|
|
112,500
|
|
|
4,462,020
|
|
|
23
|
%
|
|
39
|
|
|
$
|
163,029
|
|
|
29
|
%
|
San Francisco Bay Area
|
|
2,712,598
|
|
|
422,980
|
|
|
—
|
|
|
3,135,578
|
|
|
17
|
|
|
27
|
|
|
115,013
|
|
|
21
|
|
|
New York City
|
|
635,608
|
|
|
177,221
|
|
|
—
|
|
|
812,829
|
|
|
4
|
|
|
4
|
|
|
50,098
|
|
|
9
|
|
|
San Diego
|
|
3,063,927
|
|
|
419,728
|
|
|
31,277
|
|
|
3,514,932
|
|
|
19
|
|
|
48
|
|
|
103,048
|
|
|
19
|
|
|
Seattle
|
|
746,260
|
|
|
—
|
|
|
—
|
|
|
746,260
|
|
|
4
|
|
|
10
|
|
|
29,881
|
|
|
5
|
|
|
Maryland
|
|
2,156,196
|
|
|
—
|
|
|
—
|
|
|
2,156,196
|
|
|
12
|
|
|
29
|
|
|
49,164
|
|
|
9
|
|
|
Research Triangle Park
|
|
1,025,786
|
|
|
61,547
|
|
|
—
|
|
|
1,087,333
|
|
|
6
|
|
|
16
|
|
|
21,371
|
|
|
4
|
|
|
Canada
|
|
322,967
|
|
|
—
|
|
|
—
|
|
|
322,967
|
|
|
2
|
|
|
4
|
|
|
8,946
|
|
|
2
|
|
|
Non-cluster markets
|
|
60,178
|
|
|
—
|
|
|
—
|
|
|
60,178
|
|
|
—
|
|
|
2
|
|
|
1,000
|
|
|
—
|
|
|
North America
|
|
14,426,758
|
|
|
1,727,758
|
|
|
143,777
|
|
|
16,298,293
|
|
|
87
|
|
|
179
|
|
|
541,550
|
|
|
98
|
|
|
Asia
|
|
1,242,702
|
|
|
129,762
|
|
|
—
|
|
|
1,372,464
|
|
|
7
|
|
|
9
|
|
|
6,433
|
|
|
1
|
|
|
Subtotal
|
|
15,669,460
|
|
|
1,857,520
|
|
|
143,777
|
|
|
17,670,757
|
|
|
94
|
|
|
188
|
|
|
547,983
|
|
|
99
|
|
|
Properties “held for sale”
(2)
|
|
1,058,525
|
|
|
—
|
|
|
—
|
|
|
1,058,525
|
|
|
6
|
|
|
5
|
|
|
6,783
|
|
|
1
|
|
|
Total
|
|
16,727,985
|
|
|
1,857,520
|
|
|
143,777
|
|
|
18,729,282
|
|
|
100
|
%
|
|
193
|
|
|
$
|
554,766
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
(1) Certain properties are pledged as security under our secured notes payable as of December 31, 2014. Refer to “Schedule III – Consolidated Financial Statement Schedule of Rental Properties and Accumulated Depreciation of Alexandria Real Estate Equities, Inc.” in “Item 15. Exhibits and Financial Statement Schedules” for additional information on our properties, including encumbered properties.
(2) See page
65
for additional information regarding properties “held for sale” as of December 31, 2014.
|
|
|
|
|
Remaining Lease Term in Years
(1)
|
|
Aggregate
RSF
|
|
ABR
|
|
Percentage of Aggregate ABR
|
|
Investment-Grade Ratings
|
|||||||||||
|
|
Client Tenant
|
|
|
|
|
|
Fitch
|
|
Moody’s
|
|
S&P
|
|||||||||||
1
|
|
Novartis AG
|
|
|
2.7
|
|
|
|
699,071
|
|
|
$
|
33,860
|
|
|
6.1
|
%
|
|
AA
|
|
Aa3
|
|
AA-
|
2
|
|
Illumina, Inc.
|
|
|
15.3
|
|
|
|
595,886
|
|
|
27,180
|
|
|
4.9
|
|
|
—
|
|
—
|
|
BBB-
|
|
3
|
|
New York University
|
|
|
15.8
|
|
|
|
207,777
|
|
|
19,778
|
|
|
3.6
|
|
|
—
|
|
Aa3
|
|
AA-
|
|
4
|
|
Roche
|
|
|
5.7
|
|
|
|
343,472
|
|
|
16,490
|
|
|
3.0
|
|
|
AA
|
|
A1
|
|
AA
|
|
5
|
|
United States Government
|
|
|
9.4
|
|
|
|
344,727
|
|
|
16,346
|
|
|
2.9
|
|
|
AAA
|
|
Aaa
|
|
AA+
|
|
6
|
|
Eli Lilly and Company
|
|
|
8.9
|
|
|
|
257,119
|
|
|
15,257
|
|
|
2.8
|
|
|
A
|
|
A2
|
|
AA-
|
|
7
|
|
Amgen Inc.
|
|
|
8.7
|
|
|
|
401,623
|
|
|
14,393
|
|
|
2.6
|
|
|
BBB
|
|
Baa1
|
|
A
|
|
8
|
|
FibroGen, Inc.
|
|
|
8.9
|
|
|
|
234,249
|
|
|
14,210
|
|
|
2.6
|
|
|
—
|
|
—
|
|
—
|
|
9
|
|
Biogen Idec Inc.
|
|
|
13.4
|
|
|
|
313,872
|
|
|
13,707
|
|
|
2.5
|
|
|
—
|
|
Baa1
|
|
A-
|
|
10
|
|
Dana-Farber Cancer Institute, Inc.
|
|
|
15.5
|
|
|
|
154,100
|
|
|
11,877
|
|
|
2.1
|
|
|
—
|
|
A1
|
|
—
|
|
11
|
|
The Regents of the University of California
|
|
|
8.5
|
|
|
|
230,633
|
|
|
10,105
|
|
|
1.8
|
|
|
AA
|
|
Aa2
|
|
AA-
|
|
12
|
|
Bristol-Myers Squibb Company
|
|
|
4.0
|
|
|
|
251,316
|
|
|
10,087
|
|
|
1.8
|
|
|
A-
|
|
A2
|
|
A+
|
|
13
|
|
Celgene Corporation
|
|
|
6.7
|
|
|
|
273,086
|
|
|
10,084
|
|
|
1.8
|
|
|
—
|
|
Baa2
|
|
BBB+
|
|
14
|
|
The Scripps Research Institute
|
|
|
3.1
|
|
|
|
218,031
|
|
|
10,027
|
|
|
1.8
|
|
|
AA-
|
|
Aa3
|
|
—
|
|
15
|
|
GlaxoSmithKline plc
|
|
|
4.6
|
|
|
|
208,394
|
|
|
9,911
|
|
|
1.8
|
|
|
A+
|
|
A2
|
|
A+
|
|
16
|
|
Massachusetts Institute of Technology
|
|
|
2.9
|
|
|
|
202,897
|
|
|
9,535
|
|
|
1.7
|
|
|
—
|
|
Aaa
|
|
AAA
|
|
17
|
|
AstraZeneca PLC
|
|
|
1.7
|
|
|
|
352,039
|
|
|
9,253
|
|
|
1.7
|
|
|
A+
|
|
A2
|
|
AA-
|
|
18
|
|
Alnylam Pharmaceuticals, Inc.
|
|
|
6.8
|
|
|
|
129,424
|
|
|
6,955
|
|
|
1.3
|
|
|
—
|
|
—
|
|
—
|
|
19
|
|
Pfizer Inc.
|
|
|
4.9
|
|
|
|
128,348
|
|
|
6,396
|
|
|
1.2
|
|
|
A+
|
|
A1
|
|
AA
|
|
20
|
|
Gilead Sciences, Inc.
|
|
|
5.5
|
|
|
|
109,969
|
|
|
5,824
|
|
|
1.0
|
|
|
—
|
|
A3
|
|
A-
|
|
|
|
Total/weighted average
|
|
|
8.3
|
|
|
|
5,656,033
|
|
|
$
|
271,275
|
|
|
49.0
|
%
|
|
|
|
|
|
|
(1)
|
Represents remaining lease term in years based on percentage of aggregate ABR in effect
as of December 31, 2014
.
|
|
|
Investment-Grade
Client Tenants: |
|
56%
|
|
of ARE’s
Total ABR |
|
|
Year of
Lease Expiration
|
|
Number of
Leases Expiring
|
|
RSF of
Expiring Leases
|
|
Percentage of
Aggregate Total RSF
|
|
ABR of
Expiring Leases (per RSF)
|
|||||||||||||
2015
|
|
|
79
|
|
(1)
|
|
|
1,202,148
|
|
(1)
|
|
|
7.5
|
%
|
|
|
|
$
|
28.09
|
|
|
2016
|
|
|
93
|
|
|
|
|
1,239,201
|
|
|
|
|
7.7
|
%
|
|
|
|
$
|
32.38
|
|
|
2017
|
|
|
87
|
|
|
|
|
1,691,334
|
|
|
|
|
10.5
|
%
|
|
|
|
$
|
28.51
|
|
|
2018
|
|
|
66
|
|
|
|
|
1,569,631
|
|
|
|
|
9.8
|
%
|
|
|
|
$
|
40.57
|
|
|
2019
|
|
|
61
|
|
|
|
|
1,516,037
|
|
|
|
|
9.4
|
%
|
|
|
|
$
|
36.11
|
|
|
2020
|
|
|
41
|
|
|
|
|
1,302,185
|
|
|
|
|
8.1
|
%
|
|
|
|
$
|
35.37
|
|
|
2021
|
|
|
32
|
|
|
|
|
1,153,875
|
|
|
|
|
7.2
|
%
|
|
|
|
$
|
38.47
|
|
|
2022
|
|
|
18
|
|
|
|
|
660,502
|
|
|
|
|
4.1
|
%
|
|
|
|
$
|
29.39
|
|
|
2023
|
|
|
21
|
|
|
|
|
1,076,027
|
|
|
|
|
6.7
|
%
|
|
|
|
$
|
35.33
|
|
|
2024
|
|
|
13
|
|
|
|
|
687,118
|
|
|
|
|
4.3
|
%
|
|
|
|
$
|
45.58
|
|
|
Thereafter
|
|
|
31
|
|
|
|
|
2,757,356
|
|
|
|
|
17.2
|
%
|
|
|
|
$
|
45.25
|
|
|
(1)
|
Excludes
20
month-to-month leases for
43,672
RSF.
|
|
|
2015 RSF of Expiring Leases
|
|
ABR of
Expiring Leases
(per RSF)
|
|||||||||||||||
|
|
Leased
|
|
Negotiating/
Anticipating
|
|
Targeted for
Redevelopment
|
|
Remaining
Expiring Leases
|
|
Total
(1)
|
|
||||||||
Market
|
|
|
|
|
|
|
|||||||||||||
Greater Boston
|
|
72,462
|
|
|
31,416
|
|
|
—
|
|
|
218,659
|
|
|
322,537
|
|
|
$
|
35.29
|
|
San Francisco Bay Area
|
|
90,980
|
|
|
14,053
|
|
|
—
|
|
|
76,051
|
|
|
181,084
|
|
|
37.11
|
|
|
New York City
|
|
50
|
|
|
—
|
|
|
—
|
|
|
9,330
|
|
|
9,380
|
|
|
N/A
|
|
|
San Diego
|
|
52,768
|
|
|
—
|
|
|
182,611
|
|
(2)
|
96,083
|
|
|
331,462
|
|
|
20.51
|
|
|
Seattle
|
|
—
|
|
|
3,086
|
|
|
—
|
|
|
48,704
|
|
|
51,790
|
|
|
21.22
|
|
|
Maryland
|
|
4,842
|
|
|
35,224
|
|
|
—
|
|
|
127,668
|
|
|
167,734
|
|
|
19.99
|
|
|
Research Triangle Park
|
|
—
|
|
|
8,916
|
|
|
—
|
|
|
111,718
|
|
|
120,634
|
|
|
21.50
|
|
|
Non-cluster markets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,604
|
|
|
12,604
|
|
|
23.16
|
|
|
Asia
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,923
|
|
|
4,923
|
|
|
17.00
|
|
|
Total
|
|
221,102
|
|
|
92,695
|
|
|
182,611
|
|
|
705,740
|
|
|
1,202,148
|
|
|
$
|
28.09
|
|
Percentage of expiring leases
|
|
18
|
%
|
|
8
|
%
|
|
15
|
%
|
|
59
|
%
|
|
100
|
%
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
2016 RSF of Expiring Leases
|
|
ABR of
Expiring Leases (per RSF) |
|||||||||||||||
|
|
Leased
|
|
Negotiating/
Anticipating |
|
Targeted for
Redevelopment |
|
Remaining
Expiring Leases |
|
Total
|
|
||||||||
Market
|
|
|
|
|
|
|
|||||||||||||
Greater Boston
|
|
1,995
|
|
|
84,416
|
|
|
—
|
|
|
287,207
|
|
|
373,618
|
|
|
$
|
39.21
|
|
San Francisco Bay Area
|
|
10,992
|
|
|
—
|
|
|
—
|
|
|
128,110
|
|
|
139,102
|
|
|
32.10
|
|
|
New York City
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,399
|
|
|
5,399
|
|
|
N/A
|
|
|
San Diego
|
|
—
|
|
|
—
|
|
|
—
|
|
|
244,282
|
|
|
244,282
|
|
|
38.17
|
|
|
Seattle
|
|
2,468
|
|
|
9,594
|
|
|
—
|
|
|
37,239
|
|
|
49,301
|
|
|
31.46
|
|
|
Maryland
|
|
—
|
|
|
3,555
|
|
|
—
|
|
|
135,455
|
|
|
139,010
|
|
|
26.12
|
|
|
Research Triangle Park
|
|
—
|
|
|
—
|
|
|
—
|
|
|
142,344
|
|
|
142,344
|
|
|
22.64
|
|
|
Canada
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,479
|
|
|
67,479
|
|
|
26.94
|
|
|
Non-cluster markets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,854
|
|
|
3,854
|
|
|
20.53
|
|
|
Asia
|
|
—
|
|
|
70,470
|
|
|
—
|
|
|
4,342
|
|
|
74,812
|
|
|
16.89
|
|
|
Total
|
|
15,455
|
|
|
168,035
|
|
|
—
|
|
|
1,055,711
|
|
|
1,239,201
|
|
|
$
|
32.38
|
|
Percentage of expiring leases
|
|
1
|
%
|
|
14
|
%
|
|
—
|
%
|
|
85
|
%
|
|
100
|
%
|
|
|
(1)
|
Excludes
20
month-to-month leases for
43,672
RSF.
|
(2)
|
Comprised of
48,880
RSF at 10151 Barnes Canyon Road and
133,731
RSF at 9625 Towne Centre Drive, which were acquired in the third quarter of 2013 and the fourth quarter of 2014, respectively, with the intent to redevelop them into tech office spaces in the fourth quarter of 2015 and the third quarter of 2015, respectively, upon expiration of the leases that have been in place since the acquisition of each property.
|
|
|
|
|
RSF
|
|
Number of Properties
|
|
|
|
Occupancy Percentage
|
||||||||||||||||
|
|
|
|
|
|
ABR
|
|
Operating
|
|
Operating and Redevelopment
|
||||||||||||||||
Market /
Submarket
/ Address
|
|
Operating
|
|
Development
|
|
Redevelopment
|
|
Total
|
|
|
|
|
||||||||||||||
San Francisco Bay Area
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Mission Bay
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
409/499 Illinois Street
|
|
455,069
|
|
|
—
|
|
|
—
|
|
|
455,069
|
|
|
2
|
|
$
|
26,368
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
455 Mission Bay Boulevard South
|
|
210,398
|
|
|
—
|
|
|
—
|
|
|
210,398
|
|
|
1
|
|
9,682
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
1500 Owens Street
|
|
158,267
|
|
|
—
|
|
|
—
|
|
|
158,267
|
|
|
1
|
|
7,106
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
1700 Owens Street
|
|
157,340
|
|
|
—
|
|
|
—
|
|
|
157,340
|
|
|
1
|
|
9,365
|
|
|
98.2
|
|
|
98.2
|
|
|
|
|
1455/1515 Third Street
(Unconsolidated JV – 51.0% ownership)
|
|
—
|
|
|
422,980
|
|
|
—
|
|
|
422,980
|
|
|
2
|
|
—
|
|
|
N/A
|
|
|
N/A
|
|
|
|
|
Mission Bay
|
|
981,074
|
|
|
422,980
|
|
|
—
|
|
|
1,404,054
|
|
|
7
|
|
52,521
|
|
|
99.7
|
|
|
99.7
|
|
|
|
South San Francisco
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
Alexandria Technology Center – Gateway
|
|
448,175
|
|
|
—
|
|
|
—
|
|
|
448,175
|
|
|
6
|
|
17,012
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
600, 630, 650, 681, 901, and 951 Gateway Boulevard
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
249/259/269 East Grand Avenue
|
|
407,369
|
|
|
—
|
|
|
—
|
|
|
407,369
|
|
|
3
|
|
16,489
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
400/450 East Jamie Court
|
|
163,035
|
|
|
—
|
|
|
—
|
|
|
163,035
|
|
|
2
|
|
5,938
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
7000 Shoreline Court
|
|
136,395
|
|
|
—
|
|
|
—
|
|
|
136,395
|
|
|
1
|
|
4,398
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
341/343 Oyster Point Boulevard
|
|
107,960
|
|
|
—
|
|
|
—
|
|
|
107,960
|
|
|
2
|
|
3,313
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
South San Francisco
|
|
1,262,934
|
|
|
—
|
|
|
—
|
|
|
1,262,934
|
|
|
14
|
|
47,150
|
|
|
100.0
|
|
|
100.0
|
|
|
|
Palo Alto/Stanford Research Park
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
849/863 Mitten Road and 866 Malcolm Road
|
|
103,611
|
|
|
—
|
|
|
—
|
|
|
103,611
|
|
|
1
|
|
2,458
|
|
|
97.9
|
|
|
97.9
|
|
|
|
|
2425 Garcia Avenue and 2400/2450 Bayshore Parkway
|
|
98,446
|
|
|
—
|
|
|
—
|
|
|
98,446
|
|
|
1
|
|
3,869
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
3165 Porter Drive
|
|
91,644
|
|
|
—
|
|
|
—
|
|
|
91,644
|
|
|
1
|
|
3,885
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
75/125 Shoreway Road
|
|
82,815
|
|
|
—
|
|
|
—
|
|
|
82,815
|
|
|
1
|
|
1,542
|
|
|
71.0
|
|
|
71.0
|
|
|
|
|
3350 West Bayshore Road
|
|
60,000
|
|
|
—
|
|
|
—
|
|
|
60,000
|
|
|
1
|
|
1,919
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
2625/2627/2631 Hanover Street
|
|
32,074
|
|
|
—
|
|
|
—
|
|
|
32,074
|
|
|
1
|
|
1,669
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Palo Alto/Stanford Research Park
|
|
468,590
|
|
|
—
|
|
|
—
|
|
|
468,590
|
|
|
6
|
|
15,342
|
|
|
94.4
|
|
|
94.4
|
|
|
|
|
San Francisco Bay Area
|
|
2,712,598
|
|
|
422,980
|
|
|
—
|
|
|
3,135,578
|
|
|
27
|
|
$
|
115,013
|
|
|
98.9
|
%
|
|
98.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
New York City
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Manhattan
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
Alexandria Center
®
for Life Science
|
|
550,453
|
|
|
177,221
|
|
|
—
|
|
|
727,674
|
|
|
2
|
|
$
|
46,018
|
|
|
99.4
|
%
|
|
99.4
|
%
|
|
|
430 and 450 East 29th Street
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Pennsylvania
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
102 Witmer Road
|
|
50,000
|
|
|
—
|
|
|
—
|
|
|
50,000
|
|
|
1
|
|
3,345
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
701 Veterans Circle
|
|
35,155
|
|
|
—
|
|
|
—
|
|
|
35,155
|
|
|
1
|
|
735
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Pennsylvania
|
|
85,155
|
|
|
—
|
|
|
—
|
|
|
85,155
|
|
|
2
|
|
4,080
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
New York City
|
|
635,608
|
|
|
177,221
|
|
|
—
|
|
|
812,829
|
|
|
4
|
|
$
|
50,098
|
|
|
99.5
|
%
|
|
99.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSF
|
|
Number of Properties
|
|
|
|
Occupancy Percentage
|
||||||||||||||||
|
|
|
|
|
|
ABR
|
|
Operating
|
|
Operating and Redevelopment
|
||||||||||||||||
Market /
Submarket
/ Address
|
|
Operating
|
|
Development
|
|
Redevelopment
|
|
Total
|
|
|
|
|
||||||||||||||
San Diego
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Torrey Pines
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
ARE Nautilus
|
|
241,191
|
|
|
—
|
|
|
—
|
|
|
241,191
|
|
|
4
|
|
$
|
7,899
|
|
|
90.3
|
%
|
|
90.3
|
%
|
|
|
3530/3550 John Hopkins Court and
3535/3565 General Atomics Court
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
ARE Sunrise
|
|
211,740
|
|
|
—
|
|
|
—
|
|
|
211,740
|
|
|
3
|
|
7,999
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
10931, 10933, and 10975 North Torrey Pines Road and
3010 Science Park Road
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
ARE Spectrum
|
|
200,692
|
|
|
123,891
|
|
|
—
|
|
|
324,583
|
|
|
4
|
|
8,885
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
3115/3215 Merryfield Row and 3013/3033 Science Park Road
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
11119 North Torrey Pines Road
|
|
72,506
|
|
|
—
|
|
|
—
|
|
|
72,506
|
|
|
1
|
|
2,570
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
3545 Cray Court
|
|
116,556
|
|
|
—
|
|
|
—
|
|
|
116,556
|
|
|
1
|
|
4,827
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Torrey Pines
|
|
842,685
|
|
|
123,891
|
|
|
—
|
|
|
966,576
|
|
|
13
|
|
32,180
|
|
|
97.2
|
|
|
97.2
|
|
|
|
University Town Center
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
5200 Illumina Way
|
|
497,078
|
|
|
295,837
|
|
|
—
|
|
|
792,915
|
|
|
6
|
|
21,431
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
10300 Campus Point Drive
|
|
449,759
|
|
|
—
|
|
|
—
|
|
|
449,759
|
|
|
1
|
|
16,446
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
ARE Esplanade
|
|
180,208
|
|
|
—
|
|
|
—
|
|
|
180,208
|
|
|
3
|
|
6,737
|
|
|
93.1
|
|
|
93.1
|
|
|
|
|
4755, 4757, and 4767 Nexus Center Drive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
ARE Towne Centre
|
|
272,309
|
|
|
—
|
|
|
—
|
|
|
272,309
|
|
|
4
|
|
6,253
|
|
|
97.9
|
|
|
97.9
|
|
|
|
|
9363, 9373, 9393, and 9625 Towne Centre Drive
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
9880 Campus Point Drive
|
|
71,510
|
|
|
—
|
|
|
—
|
|
|
71,510
|
|
|
1
|
|
2,774
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
University Town Center
|
|
1,470,864
|
|
|
295,837
|
|
|
—
|
|
|
1,766,701
|
|
|
15
|
|
53,641
|
|
|
98.8
|
|
|
98.8
|
|
|
|
Sorrento Mesa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
5810/5820/6138/6150 Nancy Ridge Drive
|
|
138,844
|
|
|
—
|
|
|
—
|
|
|
138,844
|
|
|
2
|
|
2,818
|
|
|
76.3
|
|
|
76.3
|
|
|
|
|
ARE Portola
|
|
105,812
|
|
|
—
|
|
|
—
|
|
|
105,812
|
|
|
3
|
|
1,746
|
|
|
69.0
|
|
|
69.0
|
|
|
|
|
6175, 6225, and 6275 Nancy Ridge Drive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
10121/10151 Barnes Canyon Road
(2)
|
|
102,392
|
|
|
—
|
|
|
—
|
|
|
102,392
|
|
|
2
|
|
1,948
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
7330 Carroll Road
|
|
66,244
|
|
|
—
|
|
|
—
|
|
|
66,244
|
|
|
1
|
|
2,452
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
5871 Oberlin Drive
|
|
33,817
|
|
|
—
|
|
|
—
|
|
|
33,817
|
|
|
1
|
|
973
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Sorrento Mesa
|
|
447,109
|
|
|
—
|
|
|
—
|
|
|
447,109
|
|
|
9
|
|
9,937
|
|
|
85.3
|
|
|
85.3
|
|
|
|
Sorrento Valley
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
11025/11035/11045/11055/11065/11075 Roselle Street
|
|
90,378
|
|
|
—
|
|
|
31,277
|
|
|
121,655
|
|
|
6
|
|
2,253
|
|
|
100.0
|
|
|
74.3
|
|
|
|
|
3985/4025/4031/4045 Sorrento Valley Boulevard
|
|
103,111
|
|
|
—
|
|
|
—
|
|
|
103,111
|
|
|
4
|
|
2,542
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Sorrento Valley
|
|
193,489
|
|
|
—
|
|
|
31,277
|
|
|
224,766
|
|
|
10
|
|
4,795
|
|
|
100.0
|
|
|
86.1
|
|
|
|
I-15 Corridor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
13112 Evening Creek Drive
|
|
109,780
|
|
|
—
|
|
|
—
|
|
|
109,780
|
|
|
1
|
|
2,495
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
San Diego
|
|
3,063,927
|
|
|
419,728
|
|
|
31,277
|
|
|
3,514,932
|
|
|
48
|
|
$
|
103,048
|
|
|
96.5
|
%
|
|
95.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(1) We acquired 9625 Towne Centre Drive in the fourth quarter of 2014 with an in-place lease. The property contains 133,731 RSF and will undergo conversion into tech office space through redevelopment in the third quarter of 2015, upon expiration of the acquired in-place lease.
(2) We acquired these properties in the third quarter of 2013 with the intent to redevelop them upon the expiration of the in-place leases. We completed the redevelopment of 53,512 RSF at 10121 Barnes Canyon Road in the third quarter of 2014, and delivered 100% of the project to Outerwall Inc., a high-quality technology client tenant. The remaining 48,880 RSF will undergo conversion into tech office space through redevelopment beginning in the fourth quarter of 2015 upon expiration of the existing lease.
|
||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSF
|
|
Number of Properties
|
|
|
|
Occupancy Percentage
|
||||||||||||||||
|
|
|
|
|
|
ABR
|
|
Operating
|
|
Operating and Redevelopment
|
||||||||||||||||
Market /
Submarket
/ Address
|
|
Operating
|
|
Development
|
|
Redevelopment
|
|
Total
|
|
|
|
|
||||||||||||||
Seattle
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Lake Union
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
1201/1208 Eastlake Avenue East
|
|
203,369
|
|
|
—
|
|
|
—
|
|
|
203,369
|
|
|
2
|
|
$
|
8,748
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
1616 Eastlake Avenue East
|
|
168,708
|
|
|
—
|
|
|
—
|
|
|
168,708
|
|
|
1
|
|
6,273
|
|
|
84.2
|
|
|
84.2
|
|
|
|
|
1551 Eastlake Avenue East
|
|
117,482
|
|
|
—
|
|
|
—
|
|
|
117,482
|
|
|
1
|
|
3,081
|
|
|
89.4
|
|
|
89.4
|
|
|
|
|
199 East Blaine Street
|
|
115,084
|
|
|
—
|
|
|
—
|
|
|
115,084
|
|
|
1
|
|
6,163
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
219 Terry Avenue North
|
|
30,705
|
|
|
—
|
|
|
—
|
|
|
30,705
|
|
|
1
|
|
1,519
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
1600 Fairview Avenue East
|
|
27,991
|
|
|
—
|
|
|
—
|
|
|
27,991
|
|
|
1
|
|
1,147
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Lake Union
|
|
663,339
|
|
|
—
|
|
|
—
|
|
|
663,339
|
|
|
7
|
|
26,931
|
|
|
94.1
|
|
|
94.1
|
|
|
|
Elliott Bay
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
3000/3018 Western Avenue
|
|
47,746
|
|
|
—
|
|
|
—
|
|
|
47,746
|
|
|
1
|
|
1,839
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
410 West Harrison/410 Elliott Avenue West
|
|
35,175
|
|
|
—
|
|
|
—
|
|
|
35,175
|
|
|
2
|
|
1,111
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Elliott Bay
|
|
82,921
|
|
|
—
|
|
|
—
|
|
|
82,921
|
|
|
3
|
|
2,950
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Seattle
|
|
746,260
|
|
|
—
|
|
|
—
|
|
|
746,260
|
|
|
10
|
|
$
|
29,881
|
|
|
94.8
|
%
|
|
94.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Maryland
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Rockville
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
9800 Medical Center Drive
|
|
282,436
|
|
|
—
|
|
|
—
|
|
|
282,436
|
|
|
4
|
|
$
|
12,614
|
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
1330 Piccard Drive
|
|
131,511
|
|
|
—
|
|
|
—
|
|
|
131,511
|
|
|
1
|
|
3,125
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
1500/1550 East Gude Drive
|
|
90,489
|
|
|
—
|
|
|
—
|
|
|
90,489
|
|
|
2
|
|
1,681
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
14920/15010 Broschart Road
|
|
86,703
|
|
|
—
|
|
|
—
|
|
|
86,703
|
|
|
2
|
|
1,950
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
1405 Research Boulevard
|
|
71,669
|
|
|
—
|
|
|
—
|
|
|
71,669
|
|
|
1
|
|
2,091
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
5 Research Place
|
|
63,852
|
|
|
—
|
|
|
—
|
|
|
63,852
|
|
|
1
|
|
2,373
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
9920 Medical Center Drive
|
|
58,733
|
|
|
—
|
|
|
—
|
|
|
58,733
|
|
|
1
|
|
455
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
5 Research Court
|
|
54,906
|
|
|
—
|
|
|
—
|
|
|
54,906
|
|
|
1
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
12301 Parklawn Drive
|
|
49,185
|
|
|
—
|
|
|
—
|
|
|
49,185
|
|
|
1
|
|
1,169
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Rockville
|
|
889,484
|
|
|
—
|
|
|
—
|
|
|
889,484
|
|
|
14
|
|
25,458
|
|
|
93.8
|
|
|
93.8
|
|
|
|
Gaithersburg
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
Alexandria Technology Center – Gaithersburg I
|
|
377,401
|
|
|
—
|
|
|
—
|
|
|
377,401
|
|
|
4
|
|
6,921
|
|
|
86.0
|
|
|
86.0
|
|
|
|
|
9 West Watkins Mill Road and 910, 930, and
940 Clopper Road
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Alexandria Technology Center – Gaithersburg II
|
|
237,137
|
|
|
—
|
|
|
—
|
|
|
237,137
|
|
|
5
|
|
5,326
|
|
|
95.8
|
|
|
95.8
|
|
|
|
|
708 Quince Orchard Road, 1300 Quince Orchard Boulevard, and 19, 20, and 22 Firstfield Road
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
16020 Industrial Drive
|
|
71,000
|
|
|
—
|
|
|
—
|
|
|
71,000
|
|
|
1
|
|
1,048
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
401 Professional Drive
|
|
63,154
|
|
|
—
|
|
|
—
|
|
|
63,154
|
|
|
1
|
|
829
|
|
|
71.3
|
|
|
71.3
|
|
|
|
|
950 Wind River Lane
|
|
50,000
|
|
|
—
|
|
|
—
|
|
|
50,000
|
|
|
1
|
|
1,082
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
620 Professional Drive
|
|
27,950
|
|
|
—
|
|
|
—
|
|
|
27,950
|
|
|
1
|
|
1,191
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Gaithersburg
|
|
826,642
|
|
|
—
|
|
|
—
|
|
|
826,642
|
|
|
13
|
|
16,397
|
|
|
90.2
|
|
|
90.2
|
|
|
|
Beltsville
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
8000/9000/10000 Virginia Manor Road
|
|
191,884
|
|
|
—
|
|
|
—
|
|
|
191,884
|
|
|
1
|
|
2,171
|
|
|
86.6
|
|
|
86.6
|
|
|
|
Northern Virginia
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
14225 Newbrook Drive
|
|
248,186
|
|
|
—
|
|
|
—
|
|
|
248,186
|
|
|
1
|
|
5,138
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Maryland
|
|
2,156,196
|
|
|
—
|
|
|
—
|
|
|
2,156,196
|
|
|
29
|
|
$
|
49,164
|
|
|
92.5
|
%
|
|
92.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RSF
|
|
Number of Properties
|
|
|
|
Occupancy Percentage
|
||||||||||||||||
|
|
|
|
|
|
ABR
|
|
Operating
|
|
Operating and Redevelopment
|
||||||||||||||||
Market /
Submarket
/ Address
|
|
Operating
|
|
Development
|
|
Redevelopment
|
|
Total
|
|
|
|
|
||||||||||||||
Research Triangle Park
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Research Triangle Park
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
Alexandria Technology Center – Alston
|
|
186,870
|
|
|
—
|
|
|
—
|
|
|
186,870
|
|
|
3
|
|
$
|
3,065
|
|
|
95.7
|
%
|
|
95.7
|
%
|
|
|
100, 800, and 801 Capitola Drive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
108/110/112/114 TW Alexander Drive
|
|
158,417
|
|
|
—
|
|
|
—
|
|
|
158,417
|
|
|
1
|
|
4,547
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
Alexandria Innovation Center – Research Triangle Park
|
|
135,677
|
|
|
—
|
|
|
—
|
|
|
135,677
|
|
|
3
|
|
2,856
|
|
|
99.7
|
|
|
99.7
|
|
|
|
|
7010, 7020, and 7030 Kit Creek Road
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
6 Davis Drive
|
|
100,000
|
|
|
—
|
|
|
—
|
|
|
100,000
|
|
|
1
|
|
1,062
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
7 Triangle Drive
|
|
96,626
|
|
|
—
|
|
|
—
|
|
|
96,626
|
|
|
1
|
|
3,157
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
407 Davis Drive
|
|
81,956
|
|
|
—
|
|
|
—
|
|
|
81,956
|
|
|
1
|
|
1,644
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
2525 East NC Highway 54
|
|
81,580
|
|
|
—
|
|
|
—
|
|
|
81,580
|
|
|
1
|
|
1,686
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
601 Keystone Park Drive
|
|
77,395
|
|
|
—
|
|
|
—
|
|
|
77,395
|
|
|
1
|
|
1,341
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
5 Triangle Drive
|
|
32,120
|
|
|
—
|
|
|
—
|
|
|
32,120
|
|
|
1
|
|
824
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
6101 Quadrangle Drive
|
|
30,122
|
|
|
—
|
|
|
—
|
|
|
30,122
|
|
|
1
|
|
530
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
6040 George Watts Hill Drive
|
|
—
|
|
|
61,547
|
|
|
—
|
|
|
61,547
|
|
|
1
|
|
—
|
|
|
N/A
|
|
|
N/A
|
|
|
|
|
Research Triangle Park
|
|
980,763
|
|
|
61,547
|
|
|
—
|
|
|
1,042,310
|
|
|
15
|
|
20,712
|
|
|
99.1
|
|
|
99.1
|
|
|
|
Palm Beach
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
555 Heritage Drive
|
|
45,023
|
|
|
—
|
|
|
—
|
|
|
45,023
|
|
|
1
|
|
659
|
|
|
55.0
|
|
|
55.0
|
|
|
|
|
Research Triangle Park
|
|
1,025,786
|
|
|
61,547
|
|
|
—
|
|
|
1,087,333
|
|
|
16
|
|
$
|
21,371
|
|
|
97.2
|
%
|
|
97.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Canada
|
|
322,967
|
|
|
—
|
|
|
—
|
|
|
322,967
|
|
|
4
|
|
8,946
|
|
|
97.6
|
|
|
97.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Non-cluster markets
|
|
60,178
|
|
|
—
|
|
|
—
|
|
|
60,178
|
|
|
2
|
|
1,000
|
|
|
93.9
|
|
|
93.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
North America
|
|
14,426,758
|
|
|
1,727,758
|
|
|
143,777
|
|
|
16,298,293
|
|
|
179
|
|
$
|
541,550
|
|
|
97.0
|
%
|
|
96.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Asia
|
|
1,242,702
|
|
|
129,762
|
|
|
—
|
|
|
1,372,464
|
|
|
9
|
|
6,433
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Subtotal
|
|
15,669,460
|
|
|
1,857,520
|
|
|
143,777
|
|
|
17,670,757
|
|
|
188
|
|
$
|
547,983
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Properties “held for sale”
(1)
|
|
1,058,525
|
|
|
—
|
|
|
—
|
|
|
1,058,525
|
|
|
5
|
|
6,783
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Total
|
|
16,727,985
|
|
|
1,857,520
|
|
|
143,777
|
|
|
18,729,282
|
|
|
193
|
|
$
|
554,766
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(1) See page
65
for additional information regarding properties “held for sale” as of December 31, 2014.
|
|
|
|
|
|
|
CIP
Square Feet
|
|
Total Project
|
|
Year of NOI Contribution – Forecast
|
|||||||||||||||||
|
|
|
|
|
|
|
Square Feet
|
|
Leased/Negotiating %
|
|
2015
|
2016
|
2017 and Beyond
|
||||||||||||||
Market
|
|
Submarket
|
|
Address
|
|
|
|
|
|||||||||||||||||||
Current value-creation development and redevelopment projects
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Greater Boston
|
|
Longwood Medical Area
|
|
360 Longwood Avenue
|
|
258,012
|
|
|
413,536
|
|
(1)
|
|
63%
|
|
|
|
|||||||||||
Greater Boston
|
|
Cambridge
|
|
75/125 Binney Street
|
|
388,270
|
|
|
388,270
|
|
|
|
99%
|
|
|
|
|||||||||||
New York City
|
|
Manhattan
|
|
430 East 29th Street
|
|
177,221
|
|
|
418,638
|
|
(1)
|
|
91%
|
|
|
|
|||||||||||
San Diego
|
|
Torrey Pines
|
|
3013/3033 Science Park Road
|
|
123,891
|
|
|
165,938
|
|
(1)
|
|
81%
|
|
|
|
|||||||||||
Greater Boston
|
|
Route 128
|
|
225 Second Avenue
|
|
112,500
|
|
|
112,500
|
|
|
|
100%
|
|
|
|
|||||||||||
San Diego
|
|
Sorrento Valley
|
|
11055/11065/11075 Roselle Street
|
|
31,277
|
|
|
55,213
|
|
(1)
|
|
75%
|
|
|
|
|||||||||||
San Diego
|
|
University Town Center
|
|
5200 Illumina Way – Building 6
|
|
295,837
|
|
|
295,837
|
|
|
|
100%
|
|
|
|
|||||||||||
Research Triangle Park
|
|
Research Triangle Park
|
|
6040 George Watts Hill Drive
|
|
61,547
|
|
|
61,547
|
|
|
|
100%
|
|
|
|
|||||||||||
San Francisco Bay Area
|
|
Mission Bay
|
|
1455/1515 Third Street
|
|
422,980
|
|
|
422,980
|
|
|
|
100%
|
|
|
|
|||||||||||
Total/weighted average
|
|
|
|
|
|
1,871,535
|
|
|
2,334,459
|
|
|
|
90%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
Total Project
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Near-term value-creation development projects
(2)
|
|
|
|
Square Feet
|
|
Negotiating %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
San Diego
|
|
University Town Center
|
|
10300 Campus Point Drive – Building 2
|
|
|
|
143,086
|
|
|
|
75%
|
|
|
|
||||||||||||
Greater Boston
|
|
Cambridge
|
|
50 Binney Street
|
|
|
|
276,371
|
|
|
|
100%
|
|
|
|
||||||||||||
Greater Boston
|
|
Cambridge
|
|
60 Binney Street
|
|
|
|
264,150
|
|
|
|
100%
|
|
|
|
||||||||||||
San Diego
|
|
University Town Center
|
|
5200 Illumina Way
|
|
|
|
386,044
|
|
|
|
—%
|
|
|
|
||||||||||||
Seattle
|
|
Lake Union
|
|
1165 Eastlake Avenue East
|
|
|
|
106,000
|
|
|
|
—%
|
|
|
|
||||||||||||
Greater Boston
|
|
Cambridge
|
|
100 Binney Street
|
|
|
|
416,788
|
|
|
|
100%
|
|
|
|
||||||||||||
San Francisco Bay Area
|
|
SoMa
|
|
510 Townsend Street
|
|
|
|
300,000
|
|
|
|
100%
|
|
|
|
||||||||||||
New York City
|
|
Manhattan
|
|
East 29th Street
|
|
|
|
420,000
|
|
(3)
|
|
—%
|
|
|
|
||||||||||||
San Diego
|
|
University Town Center
|
|
10300 Campus Point Drive – Building 3
|
|
|
|
150,353
|
|
|
|
—%
|
|
|
|
||||||||||||
Seattle
|
|
Lake Union
|
|
400 Dexter Avenue North
|
|
|
|
253,000
|
|
|
|
—%
|
|
|
|
||||||||||||
Total/weighted average
|
|
|
|
|
|
|
|
2,715,792
|
|
|
|
50%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
(1) Portion of project was delivered in 2014, see pages
50
,
51
, and
52
for RSF currently under construction.
(2) See page
41
for RSF targeted for redevelopment.
(3) We hold a right to ground-lease a parcel supporting the future ground-up development of approximately 420,000 SF at the Alexandria Center
®
for Life Science pursuant to an option under our ground lease. We have begun discussions regarding this option and the potential to increase the site density beyond 420,000 SF.
|
|
|
|
|
Value-Creation Development Projects
|
||||||||||||||||||||||
|
|
|
|
Value-Creation Redevelopment Projects
|
|||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leased Status
|
|
Project Start
Date
|
|
Initial Occupancy Date
|
|
Stabilized Occupancy Date
|
|||||||||||||||||||
|
|
Project RSF
|
|
Leased
|
|
Negotiating
|
|
Total Leased/Negotiating
|
|
|
|
||||||||||||||||||||||
Property/Market – Submarket
|
|
In Service
|
|
CIP
|
|
Total
|
|
RSF
|
|
%
|
|
RSF
|
|
%
|
|
RSF
|
|
%
|
|
|
|
||||||||||||
Consolidated development projects in North America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
75/125 Binney Street/
Greater Boston – Cambridge
|
|
—
|
|
|
388,270
|
|
|
388,270
|
|
|
386,111
|
|
|
99
|
%
|
|
—
|
|
|
—
|
%
|
|
386,111
|
|
|
99
|
%
|
|
1Q13
|
|
1Q15
|
|
2015
|
430 East 29th Street/
New York City – Manhattan |
|
241,417
|
|
|
177,221
|
|
|
418,638
|
|
|
278,211
|
|
|
66
|
%
|
|
101,698
|
|
|
25
|
%
|
|
379,909
|
|
|
91
|
%
|
|
4Q12
|
|
4Q13
|
|
2015
|
5200 Illumina Way – Building 6/
San Diego – University Town Center |
|
—
|
|
|
295,837
|
|
|
295,837
|
|
|
149,663
|
|
|
51
|
%
|
|
146,174
|
|
|
49
|
%
|
|
295,837
|
|
|
100
|
%
|
|
3Q14
|
|
3Q16
|
|
2016
|
3013/3033 Science Park Road/
San Diego – Torrey Pines
|
|
42,047
|
|
|
123,891
|
|
|
165,938
|
|
|
105,047
|
|
|
63
|
%
|
|
29,955
|
|
|
18
|
%
|
|
135,002
|
|
|
81
|
%
|
|
2Q14
|
|
4Q14
|
|
2016
|
6040 George Watts Hill Drive/
Research Triangle Park – Research Triangle Park
|
|
—
|
|
|
61,547
|
|
|
61,547
|
|
|
61,547
|
|
|
100
|
%
|
|
—
|
|
|
—
|
%
|
|
61,547
|
|
|
100
|
%
|
|
4Q14
|
|
1Q16
|
|
2016
|
Consolidated development projects in North America
|
|
283,464
|
|
|
1,046,766
|
|
|
1,330,230
|
|
|
980,579
|
|
|
74
|
%
|
|
277,827
|
|
|
21
|
%
|
|
1,258,406
|
|
|
95
|
%
|
|
|
|
|
|
|
|
|
Investment
|
|
|
|
|
|
|
||||||||||||||||||||||||||
|
|
|
|
Cost to Complete
|
|
|
|
Unlevered
|
||||||||||||||||||||||||||
|
|
December 31, 2014
|
|
2015
|
|
Thereafter
|
|
|
|
Average Cash
Yield
|
|
Initial Stabilized Yield
(Cash Basis) |
|
Initial Stabilized Yield
|
||||||||||||||||||||
Property/Market – Submarket
|
|
|
Construction
Financing |
|
Internal Funding
|
|
Construction
Financing |
|
Internal Funding
|
|
Total at Completion
|
|
|
|||||||||||||||||||||
|
In Service
|
|
CIP
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Consolidated development projects in North America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
75/125 Binney Street/
Greater Boston – Cambridge
|
|
$
|
—
|
|
|
$
|
276,608
|
|
|
$
|
56,511
|
|
|
$
|
—
|
|
|
$
|
18,320
|
|
|
$
|
—
|
|
|
$
|
351,439
|
|
(1)
|
9.1%
|
|
8.0%
|
|
8.2%
|
430 East 29th Street/
New York City – Manhattan |
|
$
|
247,768
|
|
|
$
|
177,688
|
|
|
$
|
—
|
|
|
$
|
37,789
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
463,245
|
|
|
7.1%
|
|
6.6%
|
|
6.5%
|
5200 Illumina Way – Building 6/
San Diego – University Town Center |
|
$
|
—
|
|
|
$
|
10,088
|
|
|
$
|
—
|
|
|
$
|
35,332
|
|
|
$
|
—
|
|
|
$
|
24,480
|
|
|
$
|
69,900
|
|
|
8.6%
|
|
7.0%
|
|
8.4%
|
3013/3033 Science Park Road/
San Diego – Torrey Pines
|
|
$
|
20,264
|
|
|
$
|
32,891
|
|
|
$
|
—
|
|
|
$
|
15,595
|
|
|
$
|
—
|
|
|
$
|
36,041
|
|
|
$
|
104,791
|
|
|
7.7%
|
|
7.2%
|
|
7.1%
|
6040 George Watts Hill Drive/
Research Triangle Park – Research Triangle Park |
|
$
|
—
|
|
|
$
|
3,619
|
|
|
$
|
—
|
|
|
$
|
21,773
|
|
|
$
|
—
|
|
|
$
|
408
|
|
|
$
|
25,800
|
|
|
8.1%
|
|
7.3%
|
|
8.1%
|
Consolidated development projects in North America
|
|
$
|
268,032
|
|
|
$
|
500,894
|
|
|
$
|
56,511
|
|
|
$
|
110,489
|
|
|
$
|
18,320
|
|
|
$
|
60,929
|
|
|
$
|
1,015,175
|
|
|
|
|
|
|
|
(1)
|
In the third quarter of 2013, we completed the preliminary design and budget for interior improvements for use by ARIAD Pharmaceuticals, Inc. (“ARIAD”). Based upon our lease with ARIAD, we expect an increase in both estimated NOI and estimated cost at completion, with no significant change in our estimated yields. In light of certain changes in ARIAD’s business, ARIAD is reassessing its plans to occupy the entire facility and may sublease a portion of this project. As a result, plans and drawings for the interior improvements for the project have not been approved by ARIAD in accordance with the timelines specified in the lease. We expect ARIAD to finalize the design and budget for all or a portion of the interior improvements in the future and will provide an update on our estimated cost at completion and targeted yields. Pursuant to the terms of the lease, we expect rent to commence in late March 2015.
|
|
|
|
|
|
|
|
|
Leased Status
|
|
Project Start
Date
|
|
Initial Occupancy Date
|
|
Stabilized Occupancy Date
|
|||||||||||||||||||
|
|
Project RSF
|
|
Leased
|
|
Negotiating
|
|
Total Leased/Negotiating
|
|
|
|
||||||||||||||||||||||
Property/Market – Submarket
|
|
In Service
|
|
CIP
|
|
Total
|
|
RSF
|
|
%
|
|
RSF
|
|
%
|
|
RSF
|
|
%
|
|
|
|
||||||||||||
Unconsolidated JV development projects
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
360 Longwood Avenue/
Greater Boston – Longwood Medical Area
|
|
155,524
|
|
|
258,012
|
|
|
413,536
|
|
|
155,524
|
|
|
38
|
%
|
|
104,022
|
|
|
25
|
%
|
|
259,546
|
|
|
63
|
%
|
|
2Q12
|
|
3Q14
|
|
2016
|
1455/1515 Third Street/
San Francisco Bay Area – Mission Bay
|
|
—
|
|
|
422,980
|
|
|
422,980
|
|
|
422,980
|
|
|
100
|
%
|
|
—
|
|
|
—
|
%
|
|
422,980
|
|
|
100
|
%
|
|
3Q14
|
|
3Q16-1Q17
|
|
2016/2017
|
Total
|
|
155,524
|
|
|
680,992
|
|
|
836,516
|
|
|
578,504
|
|
|
69
|
%
|
|
104,022
|
|
|
13
|
%
|
|
682,526
|
|
|
82
|
%
|
|
|
|
|
|
|
|
|
Investment
|
|
|
|
|
|
|
||||||||||||||||||||||||||
|
|
|
|
Cost to Complete
|
|
|
|
Unlevered
(1)
|
||||||||||||||||||||||||||
|
|
December 31, 2014
|
|
2015
|
|
Thereafter
|
|
|
|
Average Cash
Yield
|
|
Initial Stabilized Yield
(Cash Basis) |
|
Initial Stabilized Yield
|
||||||||||||||||||||
Property/Market – Submarket
|
|
|
Construction
Financing |
|
Internal Funding
|
|
Construction
Financing |
|
Internal Funding
|
|
Total at Completion
|
|
|
|||||||||||||||||||||
|
In Service
|
|
CIP
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Unconsolidated JV development projects
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
100% of JV: 360 Longwood Avenue/
Greater Boston – Longwood Medical Area
|
|
$
|
111,523
|
|
|
$
|
184,844
|
|
|
$
|
35,755
|
|
|
$
|
—
|
|
|
$
|
17,878
|
|
|
$
|
—
|
|
|
$
|
350,000
|
|
|
|
|
|
|
|
100% of JV: 1455/1515 Third Street/
San Francisco Bay Area – Mission Bay
(3)
|
|
$
|
21,150
|
|
|
$
|
106,524
|
|
|
$
|
—
|
|
|
$
|
36,320
|
|
|
$
|
—
|
|
|
TBD
|
|
|
TBD
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
ARE share of unconsolidated JV development projects
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
27.5% of JV: 360 Longwood Avenue/
Greater Boston – Longwood Medical Area
|
|
$
|
34,189
|
|
|
$
|
56,667
|
|
|
$
|
9,833
|
|
|
$
|
1,513
|
|
|
$
|
4,916
|
|
|
$
|
1,847
|
|
|
$
|
108,965
|
|
|
9.3%
|
|
8.3%
|
|
8.9%
|
51.0% of JV: 1455/1515 Third Street/
San Francisco Bay Area – Mission Bay
(3)
|
|
$
|
10,787
|
|
|
$
|
55,894
|
|
|
$
|
—
|
|
|
$
|
26,487
|
|
|
$
|
—
|
|
|
TBD
|
|
|
TBD
|
|
|
TBD
|
|
TBD
|
|
TBD
|
||
Total ARE share of unconsolidated JV
development projects
|
|
$
|
44,976
|
|
|
$
|
112,561
|
|
|
$
|
9,833
|
|
|
$
|
28,000
|
|
|
$
|
4,916
|
|
|
TBD
|
|
|
TBD
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
(1) Our projected unlevered initial stabilized yield (cash basis) is based upon our share of the investment in real estate, including costs incurred directly by us outside the joint venture. Development management fees earned from these development projects have been excluded from our estimate of unlevered yields.
(2) See page
67
for additional information regarding our unconsolidated joint ventures.
(3) The design and budget of this project are in process, and the estimated project costs with related yields are expected to be disclosed in the near future.
|
|
|
|
|
|
|
|
|
Leased Status
|
|
Project Start
Date |
|
Initial Occupancy Date
|
|
Stabilized Occupancy Date
|
|||||||||||||||||||
|
|
Project RSF
|
|
Leased
|
|
Negotiating
|
|
Total Leased/Negotiating
|
|
|
|
||||||||||||||||||||||
Property/Market – Submarket
|
|
In Service
|
|
CIP
|
|
Total
|
|
RSF
|
|
%
|
|
RSF
|
|
%
|
|
RSF
|
|
%
|
|
|
|
||||||||||||
Consolidated redevelopment projects in North America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
225 Second Avenue/
Greater Boston – Route 128
(1)
|
|
—
|
|
|
112,500
|
|
|
112,500
|
|
|
112,500
|
|
|
100
|
%
|
|
—
|
|
|
—
|
%
|
|
112,500
|
|
|
100
|
%
|
|
1Q14
|
|
2Q15
|
|
2015
|
11055/11065/11075 Roselle Street/
San Diego – Sorrento Valley
(2)
|
|
23,936
|
|
|
31,277
|
|
|
55,213
|
|
|
41,163
|
|
(3)
|
75
|
%
|
|
—
|
|
|
—
|
%
|
|
41,163
|
|
|
75
|
%
|
|
4Q13
|
|
2Q14
|
|
2015
|
Consolidated redevelopment projects in North America
|
|
23,936
|
|
|
143,777
|
|
|
167,713
|
|
|
153,663
|
|
|
92
|
%
|
|
—
|
|
|
—
|
%
|
|
153,663
|
|
|
92
|
%
|
|
|
|
|
|
|
|
|
Investment
|
|
Unlevered
|
||||||||||||||||||||||
Property/Market – Submarket
|
|
December 31, 2014
|
|
Cost to Complete
|
|
Total at Completion
|
|
Average
Cash
Yield
|
|
Initial
Stabilized Yield (Cash Basis) |
|
Initial Stabilized Yield
|
||||||||||||||
|
In Service
|
|
CIP
|
|
2015
|
|
Thereafter
|
|
|
|
|
|||||||||||||||
Consolidated redevelopment projects in North America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
225 Second Avenue/
Greater Boston – Route 128
|
|
$
|
—
|
|
|
$
|
34,885
|
|
|
$
|
11,786
|
|
|
$
|
—
|
|
|
$
|
46,671
|
|
|
9.0%
|
|
8.3%
|
|
8.3%
|
11055/11065/11075 Roselle Street/
San Diego – Sorrento Valley
|
|
$
|
7,044
|
|
|
$
|
7,597
|
|
|
$
|
3,709
|
|
|
$
|
—
|
|
|
$
|
18,350
|
|
|
8.0%
|
|
7.8%
|
|
7.9%
|
Consolidated redevelopment projects in North America
|
|
$
|
7,044
|
|
|
$
|
42,482
|
|
|
$
|
15,495
|
|
|
$
|
—
|
|
|
$
|
65,021
|
|
|
|
|
|
|
|
(1)
|
Redevelopment property to accommodate expansion of existing client tenant. Property was acquired in March 2014.
|
(2)
|
Redevelopment property to accommodate expansion of existing client tenant. Property was acquired in November 2013.
|
(3)
|
In the second quarter of 2014, we delivered
23,936
RSF to a life science company. We expect to deliver the remaining leased 17,227 RSF in the second quarter of 2015.
|
|
|
Embedded Land
(1)
|
|
Total
|
|||||||||||||||||||||
Property – Market
|
|
Book Value
|
|
Square
Feet
|
|
Cost Per
Square Foot
|
|
Square
Feet
|
|
Book Value
|
|
Square
Feet
|
|
Cost Per
Square Foot
|
|||||||||||
Near-Term Value-Creation Development Projects –
Land undergoing predevelopment activities (CIP)
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Alexandria Center
®
at Kendall Square – Greater Boston:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
50, 60, and 100 Binney Street
(2)
|
|
$
|
321,907
|
|
|
957,309
|
|
|
$
|
336
|
|
|
—
|
|
|
$
|
321,907
|
|
|
957,309
|
|
|
$
|
336
|
|
510 Townsend Street – San Francisco Bay Area
|
|
58,459
|
|
|
300,000
|
|
|
195
|
|
|
—
|
|
|
58,459
|
|
|
300,000
|
|
|
195
|
|
||||
5200 Illumina Way – San Diego
(3)
|
|
8,793
|
|
|
386,044
|
|
|
23
|
|
|
—
|
|
|
8,793
|
|
|
386,044
|
|
|
23
|
|
||||
10300 Campus Point – San Diego
(3)
|
|
5,746
|
|
|
293,439
|
|
|
20
|
|
|
—
|
|
|
5,746
|
|
|
293,439
|
|
|
20
|
|
||||
1165 Eastlake Avenue East – Seattle
(4)
|
|
17,664
|
|
|
106,000
|
|
|
167
|
|
|
—
|
|
|
17,664
|
|
|
106,000
|
|
|
167
|
|
||||
400 Dexter Avenue North – Seattle
|
|
16,809
|
|
|
253,000
|
|
|
66
|
|
|
—
|
|
|
16,809
|
|
|
253,000
|
|
|
66
|
|
||||
East 29th Street – New York City
|
|
—
|
|
|
—
|
|
|
—
|
|
|
420,000
|
|
(5)
|
—
|
|
|
420,000
|
|
|
—
|
|
||||
Near-term value-creation development projects
|
|
$
|
429,378
|
|
|
2,295,792
|
|
|
$
|
187
|
|
|
420,000
|
|
|
429,378
|
|
|
2,715,792
|
|
|
158
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Future Value-Creation Development Projects –
Land held for development
|
|
|
|
|
|||||||||||||||||||||
Alexandria Technology Square
®
– Greater Boston
|
|
$
|
7,721
|
|
|
100,000
|
|
|
$
|
77
|
|
|
—
|
|
|
7,721
|
|
|
100,000
|
|
|
77
|
|
||
Alexandria Center
®
at Kendall Square – Residential – Greater Boston
(3)
(6)
|
|
28,140
|
|
|
288,515
|
|
|
98
|
|
|
—
|
|
|
28,140
|
|
|
288,515
|
|
|
98
|
|
||||
Grand Avenue – San Francisco Bay Area
(7)
|
|
45,056
|
|
|
397,132
|
|
|
113
|
|
|
—
|
|
|
45,056
|
|
|
397,132
|
|
|
113
|
|
||||
560 Eccles Avenue – San Francisco Bay Area
(8)
|
|
17,655
|
|
|
144,000
|
|
|
123
|
|
|
—
|
|
|
17,655
|
|
|
144,000
|
|
|
123
|
|
||||
Executive Drive/Other – San Diego
(3)
|
|
4,533
|
|
|
65,000
|
|
|
70
|
|
|
279,000
|
|
|
4,533
|
|
|
344,000
|
|
|
13
|
|
||||
1150/1166 Eastlake Avenue East – Seattle
|
|
15,248
|
|
|
160,266
|
|
|
95
|
|
|
—
|
|
|
15,248
|
|
|
160,266
|
|
|
95
|
|
||||
Other
|
|
56,822
|
|
|
1,753,776
|
|
|
32
|
|
|
486,000
|
|
|
56,822
|
|
|
2,239,776
|
|
|
25
|
|
||||
Future value-creation development projects
|
|
$
|
175,175
|
|
|
2,908,689
|
|
|
$
|
60
|
|
|
765,000
|
|
|
175,175
|
|
|
3,673,689
|
|
|
48
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total near-term and future value-creation development projects
|
|
|
|
|
|
|
|
1,185,000
|
|
|
$
|
604,553
|
|
|
6,389,481
|
|
|
$
|
95
|
|
(1)
|
Embedded land generally represents land acquired in connection with the acquisition of operating properties. No real estate basis is attributable to these embedded land parcels as the real estate basis is classified in rental properties with the operating property.
|
(2)
|
Includes infrastructure-related costs consisting of: utility access and roads, installation of storm drain systems, infiltration systems, traffic lighting/signals, streets, and sidewalks related to 50, 60, and 100 Binney Street. In addition, we have commenced below-grade site work for 50 and 60 Binney Street related to the foundation and subterranean parking garage.
|
(4)
|
The cost per square foot for 1165 Eastlake Avenue East includes an existing structure that can substantially be incorporated into the development plans.
|
(5)
|
We hold a right to ground-lease a parcel supporting the future ground-up development of approximately 420,000 RSF at the Alexandria Center
®
for Life Science pursuant to an option under our ground lease. We have begun discussions regarding this option and the potential to increase the site density beyond 420,000 RSF.
|
(6)
|
Includes two residential sites at our Alexandria Center
®
at Kendall Square project. We have commenced construction on one residential building aggregating approximately 105,000 gross square feet with an aggregate cost at completion estimated in the range of approximately $40 to $45 million.
|
(7)
|
Represents two additional land parcels adjoining/surrounding the recently developed 249/259/269 East Grand Avenue campus leased to Amgen Inc. in South San Francisco.
|
(8)
|
Represents an additional land parcel located near our 341/343 Oyster Point Boulevard properties and within walking distance of Roche’s campus in South San Francisco.
|
Non-Income-Producing Assets
(1)
|
||
|
|
|
(1) Represents non-income-producing assets as a percentage of gross investments in real estate, including our share of non-income-producing assets related to our unconsolidated joint ventures.
(2) Projected net reduction of 3% in non-income-producing assets from December 31, 2014, to March 31, 2015, consists of a decrease of 4% due to highly leased deliveries partially offset by a 1% increase due to additions.
|
Projected Construction Spending
|
|
Year Ended December 31, 2015
|
|
||||||||||
Current value-creation projects in North America:
|
|
|
|
|
|
|
|
||||||
|
Development (Consolidated)
|
|
$
|
167,000
|
|
|
|
|
|
||||
|
Development (Unconsolidated JV)
|
|
|
28,000
|
|
|
|
|
|
||||
|
Redevelopment
|
|
|
15,495
|
|
|
|
|
|
||||
|
Developments/redevelopments recently transferred to rental properties
|
|
|
17,505
|
|
(1)
|
|
|
|||||
|
Generic laboratory infrastructure/building improvement projects
|
|
|
50,000
|
|
(2)
|
|
|
|||||
|
|
Current value-creation projects in North America
|
|
|
|
|
|
278,000
|
|
|
|||
Near-term value-creation projects
|
|
|
|
|
|
405,000
|
|
(3)
|
|||||
Value-creation projects
|
|
|
|
|
|
683,000
|
|
|
|||||
|
Non-revenue-enhancing capital expenditures and tenant improvements
|
|
|
|
|
|
12,000
|
|
|
||||
Projected construction spending
|
|
|
|
|
$
|
695,000
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||
Guidance range for the year ended December 31, 2015
|
|
|
|
|
$
|
645,000 – 745,000
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||
(1) Represents spending for recently delivered projects, including 4757 Nexus Center Drive, 1616 Eastlake Avenue East, and 1551 Eastlake Avenue East, that may require additional construction prior to occupancy, generally ranging from 15,000 to 30,000 RSF of the project.
(2) Includes, among others, 3535 General Atomics Court, 9373 Town Center Drive, 5810/5820 Nancy Ridge Drive, 8000 Virginia Manor Road, and 44 Hartwell Avenue.
(3) See overview of our near-term value-creation projects on page
53
.
|
Capital Allocation
|
||
Projected Construction and Acquisition Spending in 2015
(1)
|
|
Actual Construction and Acquisition Spending in 2014
(2)
|
|
|
|
(1) Based upon the mid-point of 2015 guidance for construction spending of $695 million and properties acquired in January 2015 of $231 million.
(2) Based upon $523.8 million of construction spending and $290.0 million of acquisitions completed in 2014. See page
64
for further detail of 2014 acquisitions.
|
Actual Construction Spending
|
|
Year Ended December 31, 2014
|
||||
Development – North America
|
|
$
|
310,540
|
|
||
Redevelopment – North America
|
|
65,143
|
|
|||
Predevelopment
|
|
80,522
|
|
|||
Generic laboratory infrastructure/building improvement projects in North America
(1)
|
|
56,905
|
|
|||
Development and redevelopment – Asia
|
|
10,739
|
|
|||
Total construction spending
|
|
$
|
523,849
|
|
(1)
|
Includes revenue-enhancing projects and non-revenue-enhancing capital expenditures amounts shown in the table below.
|
Actual Construction Spending
|
|
Year Ended December 31, 2014
|
||||
Construction spending (accrual basis)
|
|
$
|
523,849
|
|
||
Change in accrued construction
|
|
(29,846
|
)
|
|||
Other
|
|
3,770
|
|
|||
Additions to properties (cash basis)
|
|
$
|
497,773
|
|
|
|
Year Ended December 31, 2014
|
|
Year Ended December 31, 2013
|
|
Five Year Average
Per RSF
(1)
|
||||||||||||||||||||
|
Amount
|
|
RSF
|
|
Per RSF
|
|
Amount
|
|
RSF
|
|
Per RSF
|
|
||||||||||||||
Non-revenue-enhancing capital expenditures
|
|
$
|
7,429
|
|
|
15,255,993
|
|
|
$
|
0.49
|
|
(2)
|
$
|
3,461
|
|
|
13,963,661
|
|
|
$
|
0.25
|
|
|
$
|
0.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Tenant improvements and leasing costs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Re-tenanted space
|
|
$
|
5,830
|
|
|
289,565
|
|
|
$
|
20.13
|
|
(3)
|
$
|
6,042
|
|
|
401,880
|
|
|
$
|
15.03
|
|
|
$
|
9.81
|
|
Renewal space
|
|
9,349
|
|
|
1,157,951
|
|
|
$
|
8.07
|
|
|
9,860
|
|
|
1,436,517
|
|
|
$
|
6.86
|
|
|
$
|
5.80
|
|
||
Total tenant improvements and leasing costs/weighted average
|
|
$
|
15,179
|
|
|
1,447,516
|
|
|
$
|
10.49
|
|
|
$
|
15,902
|
|
|
1,838,397
|
|
|
$
|
8.65
|
|
|
$
|
6.89
|
|
(1)
|
Represents the average of the years ended December 31, 2010, through December 31, 2014.
|
(2)
|
Includes base building improvements aggregating approximately $3.1 million incurred primarily in connection with a 248,000 RSF 10-year lease renewal. Excluding these costs, the non-revenue-enhancing capital expenditures were $0.29 per RSF for the year ended December 31, 2014.
|
(3)
|
Includes tenant improvements and leasing costs related to a 9-year lease in the Greater Boston submarket. Excluding this lease of 16,601 RSF, tenant improvements and leasing costs were $16.83 per RSF.
|
|
Number of Properties
|
|
ABR
(in thousands)
|
|
Occupancy Percentage
|
|
Book Value
(in thousands)
|
|
Square Feet
|
||||||
Rental properties in China
|
2
|
|
$
|
1,229
|
|
|
53.8
|
%
|
|
$
|
82,220
|
|
|
632,078
|
|
Rental properties in India
|
7
|
|
5,204
|
|
|
55.7
|
|
(1)
|
73,801
|
|
|
610,624
|
|
||
Rental properties in Asia
|
9
|
|
$
|
6,433
|
|
|
54.7
|
%
|
(1)
|
156,021
|
|
|
1,242,702
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Construction in progress: current development projects in India
|
|
14,065
|
|
|
129,762
|
|
|||||||||
Land held for future development in India
|
|
78,548
|
|
|
6,419,707
|
|
|||||||||
Total investments in real estate in Asia
|
|
$
|
248,634
|
|
|
7,792,171
|
|
(1)
|
Includes the completion and delivery during the fourth quarter of 2014 of a development project in India, aggregating 175,000 RSF. We are marketing this space for lease.
|
Period
|
|
High
|
|
Low
|
|
Per Share
Distribution
|
2014
|
|
|
|
|
|
|
Fourth Quarter
|
|
$91.49
|
|
$73.44
|
|
$0.74
|
Third Quarter
|
|
$80.65
|
|
$72.91
|
|
$0.72
|
Second Quarter
|
|
$78.69
|
|
$70.97
|
|
$0.72
|
First Quarter
|
|
$74.34
|
|
$62.93
|
|
$0.70
|
2013
|
|
|
|
|
|
|
Fourth Quarter
|
|
$67.99
|
|
$61.08
|
|
$0.68
|
Third Quarter
|
|
$71.29
|
|
$60.86
|
|
$0.68
|
Second Quarter
|
|
$78.43
|
|
$61.20
|
|
$0.65
|
First Quarter
|
|
$73.51
|
|
$69.77
|
|
$0.60
|
|
|
Year Ended December 31,
|
||||||||||||||||||
(Dollars in thousands, except per share amounts)
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental
|
|
$
|
544,153
|
|
|
$
|
467,764
|
|
|
$
|
422,793
|
|
|
$
|
404,815
|
|
|
$
|
340,899
|
|
Tenant recoveries
|
|
173,480
|
|
|
150,095
|
|
|
133,280
|
|
|
126,205
|
|
|
103,299
|
|
|||||
Other income
|
|
9,244
|
|
|
13,292
|
|
|
18,424
|
|
|
5,760
|
|
|
5,106
|
|
|||||
Total revenues
|
|
726,877
|
|
|
631,151
|
|
|
574,497
|
|
|
536,780
|
|
|
449,304
|
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental operations
|
|
219,164
|
|
|
189,039
|
|
|
172,756
|
|
|
157,634
|
|
|
121,246
|
|
|||||
General and administrative
|
|
53,530
|
|
|
48,520
|
|
|
47,747
|
|
|
41,112
|
|
|
34,730
|
|
|||||
Interest
|
|
79,299
|
|
|
67,952
|
|
|
69,184
|
|
|
63,373
|
|
|
66,341
|
|
|||||
Depreciation and amortization
|
|
224,096
|
|
|
189,123
|
|
|
185,687
|
|
|
150,906
|
|
|
119,223
|
|
|||||
Impairment of real estate
|
|
51,675
|
|
|
—
|
|
|
2,050
|
|
|
—
|
|
|
—
|
|
|||||
Loss on early extinguishment of debt
|
|
525
|
|
|
1,992
|
|
|
2,225
|
|
|
6,485
|
|
|
45,168
|
|
|||||
Total expenses
|
|
628,289
|
|
|
496,626
|
|
|
479,649
|
|
|
419,510
|
|
|
386,708
|
|
|||||
Equity in earnings of unconsolidated JVs
|
|
554
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Income from continuing operations
|
|
99,142
|
|
|
134,525
|
|
|
94,848
|
|
|
117,270
|
|
|
62,596
|
|
|||||
Income from discontinued operations
|
|
1,233
|
|
|
900
|
|
|
8,816
|
|
|
18,077
|
|
|
16,984
|
|
|||||
Gain on sales of real estate – land parcels
|
|
6,403
|
|
|
4,824
|
|
|
1,864
|
|
|
46
|
|
|
59,442
|
|
|||||
Net income
|
|
106,778
|
|
|
140,249
|
|
|
105,528
|
|
|
135,393
|
|
|
139,022
|
|
|||||
Dividends on preferred stock
|
|
(25,698
|
)
|
|
(25,885
|
)
|
|
(27,328
|
)
|
|
(28,357
|
)
|
|
(28,357
|
)
|
|||||
Preferred stock redemption charge
|
|
(1,989
|
)
|
|
—
|
|
|
(5,978
|
)
|
|
—
|
|
|
—
|
|
|||||
Net income attributable to noncontrolling interests
|
|
(5,204
|
)
|
|
(4,032
|
)
|
|
(3,402
|
)
|
|
(3,975
|
)
|
|
(3,729
|
)
|
|||||
Net income attributable to unvested restricted stock awards
|
|
(1,774
|
)
|
|
(1,581
|
)
|
|
(1,190
|
)
|
|
(1,088
|
)
|
|
(995
|
)
|
|||||
Net income attributable to Alexandria’s common stockholders
|
|
$
|
72,113
|
|
|
$
|
108,751
|
|
|
$
|
67,630
|
|
|
$
|
101,973
|
|
|
$
|
105,941
|
|
EPS attributable to Alexandria’s common stockholders – basic and diluted
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
|
$
|
0.99
|
|
|
$
|
1.59
|
|
|
$
|
0.95
|
|
|
$
|
1.42
|
|
|
$
|
1.84
|
|
Discontinued operations
|
|
0.02
|
|
|
0.01
|
|
|
0.14
|
|
|
0.31
|
|
|
0.35
|
|
|||||
EPS – basic and diluted
|
|
$
|
1.01
|
|
|
$
|
1.60
|
|
|
$
|
1.09
|
|
|
$
|
1.73
|
|
|
$
|
2.19
|
|
Weighted average shares of common stock outstanding
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
71,169,694
|
|
|
68,038,195
|
|
|
62,159,913
|
|
|
59,066,812
|
|
|
48,375,474
|
|
|||||
Diluted
|
|
71,169,694
|
|
|
68,038,195
|
|
|
62,160,244
|
|
|
59,077,610
|
|
|
48,405,040
|
|
|||||
Dividends declared per share of common stock
|
|
$
|
2.88
|
|
|
$
|
2.61
|
|
|
$
|
2.09
|
|
|
$
|
1.86
|
|
|
$
|
1.50
|
|
Balance Sheet Data (at year end):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in real estate
|
|
$
|
7,226,016
|
|
|
$
|
6,776,914
|
|
|
$
|
6,424,578
|
|
|
$
|
6,008,440
|
|
|
$
|
5,444,814
|
|
Total assets
|
|
$
|
8,136,036
|
|
|
$
|
7,529,764
|
|
|
$
|
7,150,116
|
|
|
$
|
6,574,129
|
|
|
$
|
5,905,861
|
|
Total debt
|
|
$
|
3,678,579
|
|
|
$
|
3,061,061
|
|
|
$
|
3,181,949
|
|
|
$
|
2,779,264
|
|
|
$
|
2,584,162
|
|
Total liabilities
|
|
$
|
4,226,478
|
|
|
$
|
3,550,823
|
|
|
$
|
3,647,058
|
|
|
$
|
3,141,236
|
|
|
$
|
2,919,533
|
|
Redeemable noncontrolling interests
|
|
$
|
14,315
|
|
|
$
|
14,444
|
|
|
$
|
14,564
|
|
|
$
|
16,034
|
|
|
$
|
15,920
|
|
Total equity
|
|
$
|
3,895,243
|
|
|
$
|
3,964,497
|
|
|
$
|
3,488,494
|
|
|
$
|
3,416,859
|
|
|
$
|
2,970,408
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||
(Dollars in thousands, except per occupied RSF amounts)
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Other Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash provided by operating activities
|
|
$
|
334,325
|
|
|
$
|
312,727
|
|
|
$
|
305,533
|
|
|
$
|
246,960
|
|
|
$
|
227,006
|
|
Cash used in investing activities
|
|
$
|
634,829
|
|
|
$
|
591,375
|
|
|
$
|
558,100
|
|
|
$
|
733,579
|
|
|
$
|
444,745
|
|
Cash provided by financing activities
|
|
$
|
331,312
|
|
|
$
|
197,570
|
|
|
$
|
314,860
|
|
|
$
|
479,156
|
|
|
$
|
237,912
|
|
Number of properties at year end
|
|
193
|
|
|
184
|
|
|
181
|
|
|
176
|
|
|
170
|
|
|||||
RSF of properties at year end
|
|
18,729,282
|
|
|
17,461,030
|
|
|
17,549,013
|
|
|
15,803,049
|
|
|
14,158,214
|
|
|||||
Occupancy of operating properties at year-end – North America
|
|
97
|
%
|
|
96
|
%
|
|
95
|
%
|
|
95
|
%
|
|
94
|
%
|
|||||
Occupancy of operating and redevelopment properties at year-end
– North America
|
|
96
|
%
|
|
96
|
%
|
|
92
|
%
|
|
88
|
%
|
|
89
|
%
|
|||||
ABR per occupied RSF at year end
|
|
$
|
37.23
|
|
|
$
|
35.90
|
|
|
$
|
34.59
|
|
|
$
|
34.39
|
|
|
$
|
33.95
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reconciliation of net income attributable to Alexandria’s common stockholders to FFO attributable to Alexandria’s common stockholders – diluted:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income attributable to Alexandria’s common stockholders
|
|
$
|
72,113
|
|
|
$
|
108,751
|
|
|
$
|
67,630
|
|
|
$
|
101,973
|
|
|
$
|
105,941
|
|
Depreciation and amortization
(1)
|
|
224,425
|
|
|
190,778
|
|
|
192,005
|
|
|
158,026
|
|
|
126,640
|
|
|||||
Impairment of real estate – rental properties
|
|
26,975
|
|
|
—
|
|
|
11,400
|
|
|
994
|
|
|
—
|
|
|||||
(Gain) loss on sales of real estate – rental properties
(2)
|
|
(1,838
|
)
|
|
121
|
|
|
(1,564
|
)
|
|
—
|
|
|
—
|
|
|||||
Gain on sales of real estate – land parcels
|
|
(6,403
|
)
|
|
(4,824
|
)
|
|
(1,864
|
)
|
|
(46
|
)
|
|
(59,466
|
)
|
|||||
Amount attributable to noncontrolling interests/
unvested restricted stock awards:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
6,978
|
|
|
5,613
|
|
|
4,592
|
|
|
5,063
|
|
|
4,724
|
|
|||||
FFO
|
|
(7,668
|
)
|
|
(5,577
|
)
|
|
(4,561
|
)
|
|
(6,402
|
)
|
|
(5,834
|
)
|
|||||
FFO attributable to Alexandria’s common stockholders – basic
(3)
|
|
314,582
|
|
|
294,862
|
|
|
267,638
|
|
|
259,608
|
|
|
172,005
|
|
|||||
Effect of dilutive securities and assumed conversion:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Assumed conversion of unsecured senior convertible notes
|
|
—
|
|
|
15
|
|
|
21
|
|
|
21
|
|
|
7,781
|
|
|||||
Effect of dilutive securities and assumed conversion attributable to unvested restricted stock awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22
|
)
|
|||||
FFO attributable to Alexandria’s common stockholders – diluted:
(3)
|
|
314,582
|
|
|
294,877
|
|
|
267,659
|
|
|
259,629
|
|
|
179,764
|
|
|||||
Impairment of investments
|
|
—
|
|
|
853
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Acquisition-related expenses
|
|
—
|
|
|
1,446
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Realized gain on equity investment primarily related to one non-tenant life science entity
|
|
—
|
|
|
—
|
|
|
(5,811
|
)
|
|
—
|
|
|
—
|
|
|||||
Impairment of real estate – land parcels
|
|
24,700
|
|
|
—
|
|
|
2,050
|
|
|
—
|
|
|
—
|
|
|||||
Loss on early extinguishment of debt
|
|
525
|
|
|
1,992
|
|
|
2,225
|
|
|
6,485
|
|
|
45,168
|
|
|||||
Preferred stock redemption charge
|
|
1,989
|
|
|
—
|
|
|
5,978
|
|
|
—
|
|
|
—
|
|
|||||
Allocation to unvested restricted stock awards
|
|
(226
|
)
|
|
(35
|
)
|
|
(39
|
)
|
|
(69
|
)
|
|
(394
|
)
|
|||||
FFO attributable to Alexandria’s common stockholders – diluted, as adjusted
(3)
|
|
$
|
341,570
|
|
|
$
|
299,133
|
|
|
$
|
272,062
|
|
|
$
|
266,045
|
|
|
$
|
224,538
|
|
(1)
|
Includes depreciation and amortization classified in discontinued operations related to assets “held for sale” (for the periods prior to when such assets were designated as “held for sale”) and our share of unconsolidated joint venture amounts.
|
(2)
|
Classified in income from discontinued operations in the consolidated statements of income.
|
(3)
|
Refer to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
–
Non-GAAP Measures – FFO and FFO, as Adjusted.”
|
•
|
Total revenues were
$726.9 million
for the year ended
December 31, 2014
, up
15.2%
, compared to
$631.2 million
for the year ended
December 31, 2013
;
|
•
|
56%
of total ABR as of
December 31, 2014
, was from investment-grade client tenants;
|
•
|
NOI was
$508.6 million
for the year ended
December 31, 2014
, up
15.0%
, compared to
$442.1 million
for the year ended
December 31, 2013
, driven by deliveries of our value-creation projects, same property NOI growth, and leasing activity further described below;
|
•
|
Operating margins were
70%
for the year ended
December 31, 2014
;
|
•
|
Same property (“Same Properties”) NOI increased
4.5%
and
5.5%
(cash basis) for the year ended
December 31, 2014
, compared to the year ended
December 31, 2013
; and
|
•
|
Our same property performance and operating margins remained solid, primarily due to the strong occupancy percentage of our asset base, solid leasing activity, and our favorable lease structure, as further described below.
|
|
December 31,
|
||||||||||
(Rentable square feet)
|
2014
|
|
2013
|
|
2012
|
||||||
Operating properties
|
16,727,985
|
|
|
15,534,238
|
|
|
15,435,147
|
|
|||
Development properties
|
1,857,520
|
|
|
1,826,919
|
|
|
1,566,774
|
|
|||
Redevelopment properties
|
143,777
|
|
|
99,873
|
|
|
547,092
|
|
|||
RSF of total properties
|
18,729,282
|
|
|
17,461,030
|
|
|
17,549,013
|
|
|||
|
|
|
|
|
|
||||||
Number of properties
|
193
|
|
|
184
|
|
|
181
|
|
|||
Occupancy in North America at year-end – operating
|
97.0
|
%
|
|
95.9
|
%
|
|
94.6
|
%
|
|||
Occupancy in North America at year-end – operating and redevelopment
|
96.1
|
%
|
|
95.5
|
%
|
|
91.6
|
%
|
|||
ABR per occupied RSF at year-end
|
$
|
37.23
|
|
|
$
|
35.90
|
|
|
$
|
34.59
|
|
•
|
Executed a total of
190
leases during the year ended
December 31, 2014
, with a weighted average lease term of
7.3 years
, for
2,768,833
RSF, including
1,321,317
RSF related to our development, redevelopment, and previously vacant projects;
|
•
|
Achieved rental rate increases for renewed/re-leased space of
13.3%
and
5.4%
(cash basis); and
|
•
|
Increased the occupancy rate for operating and redevelopment properties in North America by
60
bps to
96.1%
as of
December 31, 2014
, from December 31, 2013.
|
|
|
|
|
|
|
|
|
|
|
Unlevered
|
|
|
||||||||
Property/Market – Submarket
|
|
Commencement Date
|
|
RSF
|
|
Leased/Negotiating %
|
|
Investment at Completion
|
|
Average Cash
Yield
|
|
Initial Stabilized Yield
(Cash Basis) |
|
Initial Stabilized Yield
|
|
Key Client Tenants
|
||||
Development
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
3013/3033 Science Park Road/
San Diego – Torrey Pines |
|
2Q14
|
|
165,938
|
|
|
81
|
%
|
|
$
|
104,791
|
|
|
7.7%
|
|
7.2%
|
|
7.1%
|
|
Receptos, Inc./
The Medicines Company
|
5200 Illumina Way – Building 6/
San Diego –
University Town Center
|
|
3Q14
|
|
295,837
|
|
|
100
|
%
|
|
$
|
69,900
|
|
|
8.6%
|
|
7.0%
|
|
8.4%
|
|
Illumina, Inc.
|
1455/1515 Third Street/
San Francisco Bay Area –
Mission Bay
(1)
|
|
3Q14
|
|
422,980
|
|
|
100
|
%
|
|
TBD
|
|
|
TBD
|
|
TBD
|
|
TBD
|
|
Uber Technologies, Inc.
|
|
6040 George Watts Hill Drive/
Research Triangle Park – Research Triangle Park |
|
4Q14
|
|
61,547
|
|
|
100
|
%
|
|
$
|
25,800
|
|
|
8.1%
|
|
7.3%
|
|
8.1%
|
|
Fujifilm Diosynth Biotechnologies U.S.A., Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Redevelopment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
225 Second Avenue/
Greater Boston – Route 128 |
|
1Q14
|
|
112,500
|
|
|
100
|
%
|
|
$
|
46,671
|
|
|
9.0%
|
|
8.3%
|
|
8.3%
|
|
FORUM Pharmaceuticals Inc.
|
10121 Barnes Canyon Road/
San Diego – Sorrento Mesa |
|
1Q14
|
|
53,512
|
|
|
100
|
%
|
|
$
|
18,000
|
|
|
8.9%
|
|
7.8%
|
|
7.9%
|
|
Outerwall Inc.
|
(1)
|
Represents an unconsolidated joint venture development project.
|
|
|
|
|
|
|
|
|
|
|
Occupancy and %
of Project
Delivered
(1)
|
|
|
|
|
|
Unlevered
|
||||||||||||||||||
|
|
Placed into Service in 2014
|
|
RSF in Service
|
|
|
Total Project
|
|
Average
Cash
Yield
|
|
Initial Stabilized Yield
(Cash Basis)
|
|
Initial Stabilized Yield
|
|||||||||||||||||||||
|
|
|
|
|
Leased/
Negotiating
|
|
Investment
|
|
|
|
||||||||||||||||||||||||
Address/Market – Submarket
|
|
Date
|
|
RSF
|
|
Prior to 2014
|
|
Total
|
|
|
|
|
|
|
||||||||||||||||||||
Development projects in North America
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
499 Illinois Street/
San Francisco Bay Area – Mission Bay
|
|
Various
|
|
219,574
|
|
|
—
|
|
|
219,574
|
|
|
100%
|
|
100%
|
|
$
|
198,098
|
|
|
|
7.4
|
%
|
(2)
|
|
|
6.8
|
%
|
(2)
|
|
|
7.3
|
%
|
(2)
|
269 East Grand Avenue/
San Francisco Bay Area – Mission Bay
|
|
September 2014
|
|
107,250
|
|
|
—
|
|
|
107,250
|
|
|
100%
|
|
100%
|
|
$
|
49,600
|
|
|
|
9.7
|
%
|
(3)
|
|
|
8.4
|
%
|
(3)
|
|
|
9.7
|
%
|
(3)
|
430 East 29th Street/
New York City – Manhattan
|
|
Various
|
|
52,406
|
|
|
189,011
|
|
|
241,417
|
|
|
58%
|
|
91%
|
|
$
|
463,245
|
|
(4)
|
|
7.1
|
%
|
(5)
|
|
|
6.6
|
%
|
(5)
|
|
|
6.5
|
%
|
(5)
|
3013/3033 Science Park Road/
San Diego – Torrey Pines
|
|
End of December 2014
|
|
42,047
|
|
|
—
|
|
|
42,047
|
|
|
25%
|
|
81%
|
|
$
|
104,791
|
|
(4)
|
|
7.7
|
%
|
(5)
|
|
|
7.2
|
%
|
(5)
|
|
|
7.1
|
%
|
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Unconsolidated joint venture development projects in North America
|
||||||||||||||||||||||||||||||||||
360 Longwood Avenue/
Greater Boston – Longwood Medical Area
|
|
End of September 2014
|
|
155,524
|
|
|
—
|
|
|
155,524
|
|
|
38%
|
|
63%
|
|
$
|
350,000
|
|
(4)
|
|
9.3
|
%
|
(5)
|
|
|
8.3
|
%
|
(5)
|
|
|
8.9
|
%
|
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Redevelopment projects in North America
|
||||||||||||||||||||||||||||||||||
10121 Barnes Canyon Road/
San Diego – Sorrento Mesa
|
|
September 2014
|
|
53,512
|
|
|
—
|
|
|
53,512
|
|
|
100%
|
|
100%
|
|
$
|
18,000
|
|
|
|
8.9
|
%
|
(6)
|
|
|
7.8
|
%
|
(6)
|
|
|
7.9
|
%
|
(6)
|
11055/11065/11075 Roselle Street/
San Diego – Sorrento Valley
|
|
June 2014
|
|
23,936
|
|
|
—
|
|
|
23,936
|
|
|
43%
|
|
75%
|
|
$
|
18,350
|
|
|
|
8.0
|
%
|
(5)
|
|
|
7.8
|
%
|
(5)
|
|
|
7.9
|
%
|
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(1) As of December 31, 2014.
(2) Increased from our previously disclosed estimated yields of 7.3% for average cash yield, 6.4% for initial stabilized yield (cash basis), and 7.2% for initial stabilized yield.
(3) Increased from our estimated yields at commencement of the project of 9.3% for average cash yield, 8.1% for initial stabilized yield (cash basis), and 9.3% for initial stabilized yield.
(4) Represents 100% of investment at completion for the entire project. Only a portion of the project was placed into operations during the year ended December 31, 2014. See pages
50
and
51
for portion of development still in progress.
(5) Consistent with previously disclosed yields.
(6) Increased from our estimated yields at commencement of the project of 8.8% for average cash yield, 7.7% for initial stabilized yield (cash basis), and 7.7% for initial stabilized yield.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unlevered
|
||||||||||||||
|
|
|
|
Date Acquired
|
|
Number of Properties
|
|
Purchase Price
|
|
Loan Assumption
|
|
|
|
Percentage
|
|
Average
Cash Yield |
|
Initial
Stabilized Yield (Cash) |
|
Initial
Stabilized Yield |
|||||||||||||
Property/Market – Submarket
|
|
Type
|
|
|
|
|
|
SF
|
|
Leased
|
|
Negotiating
|
|
|
|
||||||||||||||||||
3545 Cray Court/
San Diego – Torrey Pines
|
|
Operating
|
|
1/30/14
|
|
1
|
|
$
|
64,000
|
|
|
$
|
40,724
|
|
(1)
|
116,556
|
|
|
100%
|
|
—%
|
|
|
7.2%
|
|
|
|
7.0%
|
|
|
|
7.2%
|
|
4025/4031/4045 Sorrento Valley Boulevard/
San Diego – Sorrento Valley
|
|
Operating
|
|
3/17/14
|
|
3
|
|
|
12,400
|
|
|
7,605
|
|
(2)
|
42,566
|
|
|
100%
|
|
—%
|
|
|
8.2%
|
|
|
|
7.8%
|
|
|
|
8.2%
|
|
|
225 Second Avenue/
Greater Boston – Route 128
|
|
Redevelopment
|
|
3/27/14
|
|
1
|
|
|
16,330
|
|
|
—
|
|
|
112,500
|
|
|
100%
|
(3)
|
—%
|
|
|
9.0%
|
|
|
|
8.3%
|
|
|
|
8.3%
|
|
|
510 Townsend Street/
San Francisco Bay Area – SoMa
|
|
Land
|
|
4/18/14
|
|
—
|
|
|
50,000
|
|
|
—
|
|
|
300,000
|
|
|
—%
|
|
100%
|
|
|
TBD
|
|
|
|
TBD
|
|
|
|
TBD
|
|
|
1455/1515 Third Street/
San Francisco Bay Area –
Mission Bay
(4)
|
|
Land
|
|
9/4/14
|
|
—
|
|
|
125,000
|
|
|
—
|
|
|
422,980
|
|
|
100%
|
|
—%
|
|
|
TBD
|
|
|
|
TBD
|
|
|
|
TBD
|
|
|
9625 Towne Centre Drive/
San Diego – University Town Center |
|
Redevelopment
|
|
11/5/14
|
|
1
|
|
|
22,250
|
|
|
—
|
|
|
133,731
|
|
|
100%
|
|
—%
|
|
|
TBD
|
(5)
|
|
|
TBD
|
(5)
|
|
|
TBD
|
(5)
|
|
6040 George Watts Hill Drive/
Research Triangle Park –
Research Triangle Park
|
|
Development
|
|
12/10/14
|
|
1
|
|
|
—
|
|
(6)
|
—
|
|
|
61,547
|
|
|
100%
|
|
—%
|
|
|
8.1%
|
|
|
|
7.3%
|
|
|
|
8.1%
|
|
|
Total for the year ended December 31, 2014
|
|
|
|
7
|
|
$
|
289,980
|
|
|
$
|
48,329
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
January 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
640 Memorial Drive/
Greater Boston – Cambridge (7) |
|
Operating
|
|
1/21/15
|
|
1
|
|
$
|
176,500
|
|
|
$
|
82,000
|
|
(7)
|
225,504
|
|
|
100%
|
|
—%
|
|
|
6.8%
|
|
|
|
6.4%
|
|
|
|
7.5%
|
|
Alexandria Technology Square
®
(10% noncontrolling interest)/
Greater Boston – Cambridge
|
|
Operating
|
|
1/21/15
|
(8)
|
7
|
|
$
|
108,250
|
|
|
$
|
—
|
|
|
1,181,635
|
|
|
99.5%
|
|
—%
|
|
|
6.1%
|
|
|
|
5.4%
|
|
|
|
6.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(1) Secured note payable with a contractual rate of 4.66% and a maturity date of January 1, 2023.
(2) Secured note payable with a contractual rate of 5.74% and a maturity date of April 15, 2016.
(3) Acquired vacant. We subsequently leased 100% of the project to accommodate an expansion requirement of an existing tenant.
(4) In the third quarter of 2014, Alexandria and Uber Technologies, Inc. (
“
Uber
”
) formed a joint venture and acquired key land parcels for the ground-up development of two Class A buildings. Alexandria holds a 51% interest in the joint venture and Uber holds a 49% interest. Additionally, Alexandria executed a 15-year lease with Uber. The purchase price of the land parcels, includes 423 parking structure spaces, foundation piles, plans, and permits, and was funded by contributions from Alexandria and Uber. The land parcels are fully entitled, and include Proposition M office allocation approvals. See page
51
for details of this development project. The design and budget of this project are in process, and the estimated project cost with related yields are expected to be disclosed in the near future.
(5) We acquired 9625 Towne Centre Drive in the fourth quarter of 2014 with an in-place lease. The property contains 133,731 RSF and will undergo conversion into tech office space through redevelopment in the third quarter of 2015 upon expiration of the existing lease. We plan to provide the estimated project cost with related yields when this property commences redevelopment.
(6) Represents a 99-year ground lease executed during the three months ended December 31, 2014 for land owned by our future tenant, Fujifilm Diosynth Biotechnologies U.S.A., Inc. The 61,547 RSF value-creation development project is 100% pre-leased to this tenant, and we commenced development in the fourth quarter of 2014. Ground lease payments to Fujifilm Diosynth Biotechnologies U.S.A, Inc. commence upon delivery of the completed building and are included in the expected yields.
(7) Secured note payable with a contractual rate of 3.93% and a maturity date in 2023.
(8) In January 2015, we executed an agreement to purchase the outstanding 10% noncontrolling interest in our flagship campus at Alexandria Technology Square® for $108.3 million. The purchase price will be paid in two installments of approximately $54.0 million each on April 1, 2015, and April 1, 2016.
|
|
(1)
|
Annualized using actual results for the quarter ended prior to date of sale or the fourth quarter of 2014 for assets “held for sale” as of December 31, 2014.
|
(2)
|
Represents sale price for assets sold or net book value for pending sales as of December 31, 2014, net of impairment charges recognized in the fourth quarter of 2014.
|
(3)
|
During the fourth quarter of 2014, we sold nine non-contiguous land parcels with seven industrial buildings with occupancy of 98% located in the industrial park areas of South San Francisco near Associated Road, Rozzi Place, and Eccles Avenue to a single buyer focused on operating, redeveloping, and developing industrial properties. The sale price was approximately $31 million and reduced our developable square footage in aggregate by 370,307 SF. Additionally, in the fourth quarter of 2014 and prior to the sale, we recognized impairment charges on these land parcels aggregating $24.7 million to reduce their net book value to fair value less cost to sell. We acquired these parcels in 2006 and 2007 with the intention of creating an amenity-rich campus in South San Francisco. Our goal was to capture significant expansion and growth of major biotech companies prior to the financial crisis in 2008. A significant amount of the expansion plans by major biotech companies were approved by the city of South San Francisco. As we executed very successfully on our Class A campus aggregating
407,369
RSF on long-term leases to the investment-grade-rated tenant, Amgen Inc. and allocated capital to other high-demand urban innovation campuses in Mission Bay and Cambridge, we will invest the sale proceeds immediately into highly leased value-creation ground-up development projects.
|
(4)
|
These properties were classified as “held for sale
”
/discontinued operations prior to October 2014, therefore the NOI and gain on sale are classified in “income from discontinued operations” in our consolidated statements of income.
|
(5)
|
Represents land and land improvements subject to a ground lease with the Company as a lessee. Our annualized net operating loss of
$1.4 million
primarily represents ground rent expense. Prior to the sale, our land and land improvements were leased to a tenant and the tenant was completing the construction of a
780,540
RSF building. Rental payments from the tenant were expected to commence upon completion and stabilization of the building.
|
(6)
|
During the fourth quarter of 2014, we committed to the sale of an operating property with a
155,685
RSF building located in South San Francisco, classified it as “held for sale,” and accordingly, recognized an impairment charge of $9.6 million to reduce its net book value to our estimate of fair value less cost to sell of $107.8 million. The impairment is primarily related to the write-off of non-cash items related to improvements received from a prior tenant and an acquired below market lease. These non-cash items had a net book value of $17.7 million immediately prior to recognition of the impairment charge. The property was originally acquired in 2007 and is currently leased to an investment-grade-rated client tenant through 2019. We expect to complete the sale in 2015 at a low cap rate and immediately invest the proceeds into highly leased value-creation ground-up development projects.
|
•
|
Achieved solid key credit metric ratios, including a net debt to Adjusted EBITDA ratio of
7.2
times and a fixed charge coverage ratio of
3.3
times for the fourth quarter of
2014
on an annualized basis;
|
•
|
Reduced our non-income-producing assets (construction in progress and land) to
16%
of our gross investments in real estate as of
December 31, 2014
, and expect to further reduce this percentage to 13% by March 31, 2015, primarily through deliveries of our highly pre-leased development projects;
|
•
|
Completed the successful offering of
$700 million
of unsecured senior notes consisting of
$400 million
of
2.75%
unsecured senior notes payable due in
2020
(“2.75% Unsecured Senior Notes”) and
$300 million
of
4.50%
unsecured senior notes payable due in
2029
(“4.50% Unsecured Senior Notes”); extended average remaining term of outstanding debt to
5.6
years as of
December 31, 2014
;
|
•
|
Maintained significant liquidity of approximately
$1.45 billion
as of
December 31, 2014
;
|
•
|
Executed additional interest rate swap agreements to provide a minimum of hedged variable-rate debt of
$500 million
in both 2015 and 2016;
|
•
|
In August 2014, Standard & Poor’s Ratings Services raised their credit outlook for Alexandria to Positive from Stable, reflecting continued and further expected improvement in key credit metrics and growth in cash flows; and
|
•
|
Maintained a high-quality client tenant base; as of December 31, 2014, 56% of our total annualized base rent was from investment-grade client tenants.
|
Unconsolidated joint venture information
As of December 31, 2014
|
||||||||||||||||||||
|
|
360 Longwood Avenue
|
|
1455/1515 Third Street
|
|
Total
ARE Share
|
||||||||||||||
|
|
100%
|
|
ARE’s
27.5% Share
|
(1)
|
100%
|
|
ARE’s
51% Share
|
(1)
|
|||||||||||
Rental properties
|
|
$
|
111,523
|
|
|
$
|
34,189
|
|
|
$
|
21,150
|
|
|
$
|
10,787
|
|
|
$
|
44,976
|
|
Construction in progress
|
|
184,844
|
|
|
56,667
|
|
|
106,524
|
|
|
55,894
|
|
|
112,561
|
|
|||||
Gross investments in real estate
|
|
296,367
|
|
|
90,856
|
|
|
127,674
|
|
|
66,681
|
|
|
157,537
|
|
|||||
Less: accumulated depreciation
|
|
(591
|
)
|
|
(200
|
)
|
|
(176
|
)
|
|
(90
|
)
|
|
(290
|
)
|
|||||
Investments in real estate
|
|
295,776
|
|
|
90,656
|
|
|
127,498
|
|
|
66,591
|
|
|
157,247
|
|
|||||
Other assets
|
|
10,410
|
|
|
3,637
|
|
|
7,319
|
|
|
3,861
|
|
|
7,498
|
|
|||||
Total assets
|
|
$
|
306,186
|
|
|
$
|
94,293
|
|
|
$
|
134,817
|
|
|
$
|
70,452
|
|
|
$
|
164,745
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Secured notes payable
|
|
$
|
159,881
|
|
(3)
|
$
|
43,967
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
43,967
|
|
Other liabilities
|
|
4,445
|
|
|
1,227
|
|
|
4,206
|
|
|
2,145
|
|
|
3,372
|
|
|||||
Total liabilities
|
|
164,326
|
|
|
45,194
|
|
|
4,206
|
|
|
2,145
|
|
|
47,339
|
|
|||||
Equity
|
|
141,860
|
|
|
49,099
|
|
|
130,611
|
|
|
68,307
|
|
|
117,406
|
|
|||||
Total liabilities and equity
|
|
$
|
306,186
|
|
|
$
|
94,293
|
|
|
$
|
134,817
|
|
|
$
|
70,452
|
|
|
$
|
164,745
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
RSF
|
|
|
|
RSF
|
|
|
|
|
||||||||||
Rental properties
|
|
155,524
|
|
(4)
|
|
|
—
|
|
|
|
|
|
||||||||
Active development (CIP)
(5)
|
|
258,012
|
|
|
|
|
422,980
|
|
|
|
|
|
||||||||
Total
|
|
413,536
|
|
|
|
|
422,980
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(1) Amounts include costs incurred directly by us outside the joint ventures. We believe the ARE basis in our investments in unconsolidated joint ventures is useful information for investors as it provides our proportional share of the investments in real estate from all properties, including our share of the assets and liabilities of our unconsolidated joint ventures. The ARE basis allows investors to estimate the impact of real estate investments and debt financing at the joint venture level.
(2) Includes development fees earned.
(3) Secured construction loan with an aggregate commitment of $213.2 million, which bears interest at LIBOR+3.75%, with a floor of 5.25%. The maturity date of the loan is April 1, 2017, with two, one-year options to extend the stated maturity date to April 1, 2019, subject to certain conditions.
(4) Delivery of 154,100 RSF occurred in late September 2014.
(5) See page
51
for further detail of our unconsolidated joint venture development projects.
|
|
|
December 31,
|
||||
|
|
2014
|
|
2013
|
||
Percentage change in NOI over comparable period from prior year
|
|
4.5%
|
|
|
1.8%
|
|
Percentage change in NOI (cash basis) over comparable period from prior year
|
|
5.5%
|
|
|
5.4%
|
|
Operating margin
|
|
69%
|
|
|
68%
|
|
Number of Same Properties
|
|
149
|
|
|
137
|
|
RSF
|
|
12,419,189
|
|
11,781,883
|
||
Occupancy – current period average
|
|
96.6%
|
|
93.5%
|
||
Occupancy – same period prior year average
|
|
93.5%
|
|
92.7%
|
Development – current
|
|
Properties
|
|
Summary
|
|
Properties
|
||
75/125 Binney Street
|
|
1
|
|
|
Development – current
|
|
9
|
|
430 East 29th Street
|
|
1
|
|
|
Development – deliveries
|
|
3
|
|
5200 Illumina Way – Building 6
|
|
1
|
|
|
Redevelopment – current
|
|
3
|
|
3013/3033 Science Park Road
|
|
2
|
|
|
Redevelopment – deliveries
|
|
11
|
|
6040 George Watts Hill Drive
|
|
1
|
|
|
|
|
|
|
360 Longwood Avenue (unconsolidated JV)
|
|
1
|
|
|
Development/redevelopment – Asia
|
|
5
|
|
1455/1515 Third Street (unconsolidated JV)
|
|
2
|
|
|
|
|||
|
|
9
|
|
|
Acquisitions in North America since January 1, 2013:
|
|||
|
|
|
|
10151 Barnes Canyon Road
|
|
1
|
|
|
Development – deliveries since January 1, 2013
|
|
Properties
|
|
407 Davis Drive
|
|
1
|
|
|
225 Binney Street
|
|
1
|
|
|
150 Second Street
|
|
1
|
|
269 East Grand Avenue
|
|
1
|
|
|
3545 Cray Court
|
|
1
|
|
499 Illinois Street
|
|
1
|
|
|
4025/4031/4045 Sorrento Valley Boulevard
|
|
3
|
|
|
|
3
|
|
|
9625 Towne Centre Drive
|
|
1
|
|
|
|
|
|
|
|
|
||
Redevelopment – current
|
|
Properties
|
|
Properties “held for sale”
|
|
5
|
|
|
225 Second Avenue
|
|
1
|
|
|
Total properties excluded from Same Properties
|
|
44
|
|
11055/11065 Roselle Street
|
|
2
|
|
|
|
|
|
|
|
|
3
|
|
|
Same Properties
|
|
149
|
|
|
|
|
|
|
|
|
||
Redevelopment – deliveries since January 1, 2013
|
|
Properties
|
|
Total properties as of December 31, 2014
|
|
193
|
|
|
400 Technology Square
|
|
1
|
|
|
|
|
|
|
1551 Eastlake Avenue East
|
|
1
|
|
|
|
|
|
|
285 Bear Hill Road
|
|
1
|
|
|
|
|
|
|
343 Oyster Point Boulevard
|
|
1
|
|
|
|
|
|
|
1616 Eastlake Avenue East
|
|
1
|
|
|
|
|
|
|
9800 Medical Center Drive
|
|
3
|
|
|
|
|
|
|
4757 Nexus Center Drive
|
|
1
|
|
|
|
|
|
|
11075 Roselle Street
|
|
1
|
|
|
|
|
|
|
10121 Barnes Canyon Road
|
|
1
|
|
|
|
|
|
|
|
|
11
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|||||||||||||
|
|
2014
|
|
2013
|
|
$ Change
|
|
% Change
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||||||
Rental – Same Properties
|
|
$
|
437,987
|
|
|
$
|
421,615
|
|
|
$
|
16,372
|
|
|
3.9
|
%
|
Rental – Non-Same Properties
|
|
106,166
|
|
|
46,149
|
|
|
60,017
|
|
|
130.1
|
|
|||
Total rental
|
|
544,153
|
|
|
467,764
|
|
|
76,389
|
|
|
16.3
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Tenant recoveries – Same Properties
|
|
148,694
|
|
|
138,682
|
|
|
10,012
|
|
|
7.2
|
|
|||
Tenant recoveries – Non-Same Properties
|
|
24,786
|
|
|
11,413
|
|
|
13,373
|
|
|
117.2
|
|
|||
Total tenant recoveries
|
|
173,480
|
|
|
150,095
|
|
|
23,385
|
|
|
15.6
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Other income – Same Properties
|
|
398
|
|
|
156
|
|
|
242
|
|
|
155.1
|
|
|||
Other income – Non-Same Properties
|
|
8,846
|
|
|
13,136
|
|
|
(4,290
|
)
|
|
(32.7
|
)
|
|||
Total other income
|
|
9,244
|
|
|
13,292
|
|
|
(4,048
|
)
|
|
(30.5
|
)
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total revenues – Same Properties
|
|
587,079
|
|
|
560,453
|
|
|
26,626
|
|
|
4.8
|
|
|||
Total revenues – Non-Same Properties
|
|
139,798
|
|
|
70,698
|
|
|
69,100
|
|
|
97.7
|
|
|||
Total revenues
|
|
726,877
|
|
|
631,151
|
|
|
95,726
|
|
|
15.2
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Expenses:
|
|
|
|
|
|
|
|
|
|||||||
Rental operations – Same Properties
|
|
183,028
|
|
|
173,799
|
|
|
9,229
|
|
|
5.3
|
|
|||
Rental operations – Non-Same Properties
|
|
36,136
|
|
|
15,240
|
|
|
20,896
|
|
|
137.1
|
|
|||
Total rental operations
|
|
219,164
|
|
|
189,039
|
|
|
30,125
|
|
|
15.9
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Our share of NOI from unconsolidated JVs:
|
|
|
|
|
|
|
|
|
|||||||
JV NOI – Same Properties
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
JV NOI – Non-Same Properties
|
|
918
|
|
|
—
|
|
|
918
|
|
|
100.0
|
|
|||
Our share of NOI from unconsolidated JVs
|
|
918
|
|
|
—
|
|
|
918
|
|
|
100.0
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
NOI:
|
|
|
|
|
|
|
|
|
|||||||
NOI – Same Properties
|
|
404,051
|
|
|
386,654
|
|
|
17,397
|
|
|
4.5
|
|
|||
NOI – Non-Same Properties
|
|
104,580
|
|
|
55,458
|
|
|
49,122
|
|
|
88.6
|
|
|||
Total NOI
|
|
508,631
|
|
|
442,112
|
|
|
66,519
|
|
|
15.0
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Other expenses:
|
|
|
|
|
|
|
|
|
|||||||
General and administrative
|
|
53,530
|
|
|
48,520
|
|
|
5,010
|
|
|
10.3
|
|
|||
Interest
|
|
79,299
|
|
|
67,952
|
|
|
11,347
|
|
|
16.7
|
|
|||
Depreciation and amortization
|
|
224,096
|
|
|
189,123
|
|
|
34,973
|
|
|
18.5
|
|
|||
Impairment of real estate
|
|
51,675
|
|
|
—
|
|
|
51,675
|
|
|
100.0
|
|
|||
Loss on early extinguishment of debt
|
|
525
|
|
|
1,992
|
|
|
(1,467
|
)
|
|
(73.6
|
)
|
|||
|
|
409,125
|
|
|
307,587
|
|
|
101,538
|
|
|
33.0
|
|
|||
Less: our share of NOI from unconsolidated JVs
|
|
(918
|
)
|
|
—
|
|
|
(918
|
)
|
|
(100.0
|
)
|
|||
Equity in earnings of unconsolidated JVs
|
|
554
|
|
|
—
|
|
|
554
|
|
|
100.0
|
|
|||
Income from continuing operations
|
|
$
|
99,142
|
|
|
$
|
134,525
|
|
|
$
|
(35,383
|
)
|
|
(26.3
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
NOI – Same Properties
|
|
$
|
404,051
|
|
|
$
|
386,654
|
|
|
$
|
17,397
|
|
|
4.5
|
%
|
Less: straight-line rent adjustments
|
|
(18,878
|
)
|
|
(21,451
|
)
|
|
2,573
|
|
|
(12.0
|
)
|
|||
NOI (cash basis) – Same Properties
|
|
$
|
385,173
|
|
|
$
|
365,203
|
|
|
$
|
19,970
|
|
|
5.5
|
%
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2014
|
|
2013
|
|
Change
|
||||||
Management fee income
|
|
$
|
2,761
|
|
|
$
|
3,133
|
|
|
$
|
(372
|
)
|
Interest and other income
|
|
4,157
|
|
|
4,589
|
|
|
(432
|
)
|
|||
Investment income
|
|
2,326
|
|
|
5,570
|
|
|
(3,244
|
)
|
|||
Total other income
|
|
$
|
9,244
|
|
|
$
|
13,292
|
|
|
$
|
(4,048
|
)
|
|
|
Year Ended December 31,
|
|
|
||||||||
Component
|
|
2014
|
|
2013
|
|
Change
|
||||||
Secured notes payable
|
|
$
|
29,429
|
|
|
$
|
38,496
|
|
|
$
|
(9,067
|
)
|
Unsecured senior notes payable
|
|
56,125
|
|
|
36,456
|
|
|
19,669
|
|
|||
Unsecured senior line of credit
|
|
8,107
|
|
|
7,007
|
|
|
1,100
|
|
|||
Unsecured senior bank term loans
|
|
14,328
|
|
|
20,934
|
|
|
(6,606
|
)
|
|||
Interest rate swaps
|
|
6,871
|
|
|
15,422
|
|
|
(8,551
|
)
|
|||
Amortization of loan fees and other interest
|
|
11,544
|
|
|
10,232
|
|
|
1,312
|
|
|||
Unsecured senior convertible notes
|
|
—
|
|
|
20
|
|
|
(20
|
)
|
|||
Total interest incurred
|
|
126,404
|
|
|
128,567
|
|
|
(2,163
|
)
|
|||
Capitalized interest
|
|
(47,105
|
)
|
|
(60,615
|
)
|
|
13,510
|
|
|||
Total interest expense
|
|
$
|
79,299
|
|
|
$
|
67,952
|
|
|
$
|
11,347
|
|
|
|
Year Ended December 31,
|
|||||||||||||
|
|
2013
|
|
2012
|
|
$ Change
|
|
% Change
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|||||||
Rental – Same Properties
|
|
$
|
382,083
|
|
|
$
|
373,589
|
|
|
$
|
8,494
|
|
|
2.3
|
%
|
Rental – Non-Same Properties
|
|
85,681
|
|
|
49,204
|
|
|
36,477
|
|
|
74.1
|
|
|||
Total rental
|
|
467,764
|
|
|
422,793
|
|
|
44,971
|
|
|
10.6
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Tenant recoveries – Same Properties
|
|
124,080
|
|
|
120,168
|
|
|
3,912
|
|
|
3.3
|
|
|||
Tenant recoveries – Non-Same Properties
|
|
26,015
|
|
|
13,112
|
|
|
12,903
|
|
|
98.4
|
|
|||
Total tenant recoveries
|
|
150,095
|
|
|
133,280
|
|
|
16,815
|
|
|
12.6
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Other income – Same Properties
|
|
342
|
|
|
348
|
|
|
(6
|
)
|
|
(1.7
|
)
|
|||
Other income – Non-Same Properties
|
|
12,950
|
|
|
18,076
|
|
|
(5,126
|
)
|
|
(28.4
|
)
|
|||
Total other income
|
|
13,292
|
|
|
18,424
|
|
|
(5,132
|
)
|
|
(27.9
|
)
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total revenues – Same Properties
|
|
506,505
|
|
|
494,105
|
|
|
12,400
|
|
|
2.5
|
|
|||
Total revenues – Non-Same Properties
|
|
124,646
|
|
|
80,392
|
|
|
44,254
|
|
|
55.0
|
|
|||
Total revenues
|
|
631,151
|
|
|
574,497
|
|
|
56,654
|
|
|
9.9
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Expenses:
|
|
|
|
|
|
|
|
|
|||||||
Rental operations – Same Properties
|
|
160,358
|
|
|
153,961
|
|
|
6,397
|
|
|
4.2
|
|
|||
Rental operations – Non-Same Properties
|
|
28,681
|
|
|
18,795
|
|
|
9,886
|
|
|
52.6
|
|
|||
Total rental operations
|
|
189,039
|
|
|
172,756
|
|
|
16,283
|
|
|
9.4
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
NOI:
|
|
|
|
|
|
|
|
|
|||||||
NOI – Same Properties
|
|
346,147
|
|
|
340,144
|
|
|
6,003
|
|
|
1.8
|
|
|||
NOI – Non-Same Properties
|
|
95,965
|
|
|
61,597
|
|
|
34,368
|
|
|
55.8
|
|
|||
Total NOI
|
|
442,112
|
|
|
401,741
|
|
|
40,371
|
|
|
10.0
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Other expenses:
|
|
|
|
|
|
|
|
|
|||||||
General and administrative
|
|
48,520
|
|
|
47,747
|
|
|
773
|
|
|
1.6
|
|
|||
Interest
|
|
67,952
|
|
|
69,184
|
|
|
(1,232
|
)
|
|
(1.8
|
)
|
|||
Depreciation and amortization
|
|
189,123
|
|
|
185,687
|
|
|
3,436
|
|
|
1.9
|
|
|||
Impairment of land parcel
|
|
—
|
|
|
2,050
|
|
|
(2,050
|
)
|
|
(100.0
|
)
|
|||
Loss on early extinguishment of debt
|
|
1,992
|
|
|
2,225
|
|
|
(233
|
)
|
|
(10.5
|
)
|
|||
|
|
307,587
|
|
|
306,893
|
|
|
694
|
|
|
0.2
|
|
|||
Income from continuing operations
|
|
$
|
134,525
|
|
|
$
|
94,848
|
|
|
$
|
39,677
|
|
|
41.8
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
NOI – Same Properties
|
|
$
|
346,147
|
|
|
$
|
340,144
|
|
|
$
|
6,003
|
|
|
1.8
|
%
|
Less: straight-line rent adjustments
|
|
(5,299
|
)
|
|
(16,618
|
)
|
|
11,319
|
|
|
(68.1
|
)
|
|||
NOI (cash basis) – Same Properties
|
|
$
|
340,848
|
|
|
$
|
323,526
|
|
|
$
|
17,322
|
|
|
5.4
|
%
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2013
|
|
2012
|
|
Change
|
||||||
Management fee income
|
|
$
|
3,133
|
|
|
$
|
2,679
|
|
|
$
|
454
|
|
Interest income
|
|
4,589
|
|
|
3,364
|
|
|
1,225
|
|
|||
Investment income
|
|
5,570
|
|
|
12,381
|
|
|
(6,811
|
)
|
|||
Total other income
|
|
$
|
13,292
|
|
|
$
|
18,424
|
|
|
$
|
(5,132
|
)
|
|
|
Year Ended December 31,
|
|
|
||||||||
Component
|
|
2013
|
|
2012
|
|
Change
|
||||||
Secured notes payable
|
|
$
|
38,496
|
|
|
$
|
40,439
|
|
|
$
|
(1,943
|
)
|
Unsecured senior notes payable
|
|
36,456
|
|
|
21,255
|
|
|
15,201
|
|
|||
Unsecured senior line of credit
|
|
7,007
|
|
|
12,035
|
|
|
(5,028
|
)
|
|||
Unsecured senior bank term loans
|
|
20,934
|
|
|
25,567
|
|
|
(4,633
|
)
|
|||
Interest rate swaps
|
|
15,422
|
|
|
22,309
|
|
|
(6,887
|
)
|
|||
Amortization of loan fees and other interest
|
|
10,232
|
|
|
10,084
|
|
|
148
|
|
|||
Unsecured senior convertible notes
|
|
20
|
|
|
246
|
|
|
(226
|
)
|
|||
Total interest incurred
|
|
128,567
|
|
|
131,935
|
|
|
(3,368
|
)
|
|||
Capitalized interest
|
|
(60,615
|
)
|
|
(62,751
|
)
|
|
2,136
|
|
|||
Total interest expense
|
|
$
|
67,952
|
|
|
$
|
69,184
|
|
|
$
|
(1,232
|
)
|
|
|
Balance as of December 31, 2013
|
|
Maturity Date
|
|
Applicable Rate
|
|
Facility Fee
|
||||||||||
Facility
|
|
|
Prior
|
|
Amended
|
|
Prior
|
|
Amended
|
|
Prior
|
|
Amended
|
|||||
2016 Unsecured Senior Bank Term Loan
|
|
$
|
500
|
million
|
|
June 2016
|
|
July 2016
|
|
L+1.75%
|
|
L+1.20%
|
|
N/A
|
|
|
N/A
|
|
2019 Unsecured Senior Bank Term Loan
|
|
$
|
600
|
million
|
|
January 2017
|
|
January 2019
|
|
L+1.50%
|
|
L+1.20%
|
|
N/A
|
|
|
N/A
|
|
$1.5 billion unsecured senior line of credit
|
|
$
|
204
|
million
|
|
April 2017
|
|
January 2019
|
|
L+1.20%
|
|
L+1.10%
|
|
0.25
|
%
|
|
0.20
|
%
|
EPS and FFO Per Share Attributable to Alexandria’s Common Stockholders – Diluted
|
|
2015 Guidance
|
EPS
|
|
$1.60 to $1.80
|
Add back: depreciation and amortization
|
|
3.52
|
Other
|
|
(0.02)
|
FFO per share
|
|
$5.10 to $5.30
|
|
|
2015 Guidance
|
||||||
Key Assumptions
(Dollars in thousands)
|
|
Low
|
|
High
|
||||
Occupancy percentage for operating properties in North America as of December 31, 2015
|
|
96.9%
|
|
|
97.4%
|
|
||
|
|
|
|
|
||||
Same property performance:
|
|
|
|
|
||||
NOI increase
|
|
0.5%
|
|
|
2.5%
|
|
||
NOI increase (cash basis)
|
|
5.0%
|
|
|
7.0%
|
|
||
|
|
|
|
|
||||
Lease renewals and re-leasing of space:
|
|
|
|
|
||||
Rental rate increases
|
|
14.0%
|
|
|
17.0%
|
|
||
Rental rate increases (cash basis)
|
|
8.0%
|
|
|
10.0%
|
|
||
|
|
|
|
|
||||
|
|
|
|
|
||||
Straight-line rents
|
|
$
|
42,000
|
|
|
$
|
47,000
|
|
General and administrative expenses
|
|
$
|
55,000
|
|
|
$
|
59,000
|
|
Capitalization of interest
|
|
$
|
35,000
|
|
|
$
|
45,000
|
|
Interest expense
|
|
$
|
110,000
|
|
|
$
|
120,000
|
|
Key Credit Metrics
|
|
2015 Guidance
|
Net debt to Adjusted EBITDA – fourth quarter of 2015 annualized
|
|
6.5x to 7.5x
|
Fixed charge coverage ratio – fourth quarter of 2015 annualized
|
|
3.0x to 3.5x
|
Non-income-producing assets as a percentage of gross real estate as of December 31, 2015
|
|
10% to 15%
|
Net Debt to Adjusted EBITDA
|
|
Fixed Charge Coverage Ratio
|
|
|
|
|
||
|
||
|
•
|
Retain positive cash flows from operating activities after payment of dividends for reinvestment in acquisitions and/or development and redevelopment projects;
|
•
|
Maintain adequate liquidity from net cash provided by operating activities, cash and cash equivalents, and available borrowing capacity under our unsecured senior line of credit and available commitments under our secured construction loans;
|
•
|
Reduce the amount of our unsecured bank debt;
|
•
|
Maintain diverse sources of capital, including sources from net cash provided by operating activities, unsecured debt, secured debt, selective asset sales, joint venture capital, preferred stock, and common stock;
|
•
|
Manage the amount of debt maturing in a single year;
|
•
|
Mitigate unhedged variable-rate debt exposure through the reduction of short-term and medium-term variable-rate bank debt;
|
•
|
Maintain a large unencumbered asset pool to provide financial flexibility;
|
•
|
Fund preferred stock and common stock dividends from net cash provided by operating activities;
|
•
|
Manage a disciplined level of value-creation projects as a percentage of our gross investments in real estate;
|
•
|
Maintain high levels of pre-leasing and percentage leased in value-creation projects; and
|
•
|
Maintain solid key credit metrics, including net debt to Adjusted EBITDA and fixed charge coverage ratio, with some variation from quarter to quarter and year to year.
|
|
|
Balance as of December 31, 2014
|
|
As of December 31, 2014
|
||||||
Facility
|
|
|
Maturity Date
(1)
|
|
Applicable Rate
|
|
Facility Fee
|
|||
2016 Unsecured Senior Bank Term Loan
|
|
$
|
375
|
million
|
|
July 2016
|
|
LIBOR+1.20%
|
|
N/A
|
2019 Unsecured Senior Bank Term Loan
|
|
$
|
600
|
million
|
|
January 2019
|
|
LIBOR+1.20%
|
|
N/A
|
$1.5 billion unsecured senior line of credit
|
|
$
|
304
|
million
|
|
January 2019
|
|
LIBOR+1.10%
|
|
0.20%
|
(1)
|
Includes any extension options that we control.
|
Covenant Ratios
(1)
|
|
Requirement
|
|
Actual
(2)
|
Leverage Ratio
|
|
Less than or equal to 60.0%
|
|
35.9%
|
Secured Debt Ratio
|
|
Less than or equal to 45.0%
|
|
6.4%
|
Fixed Charge Coverage Ratio
|
|
Greater than or equal to 1.50x
|
|
3.12x
|
Unsecured Leverage Ratio
|
|
Less than or equal to 60.0%
|
|
38.9%
|
Unsecured Interest Coverage Ratio
|
|
Greater than or equal to 1.50x
|
|
8.19x
|
(1)
|
For definitions of the ratios, refer to the amended unsecured senior line of credit and unsecured senior bank term loan agreements filed as Exhibits 10.24, 10.25, 10.26, and 10.27 hereto, which are listed in Item 15 of this report.
|
(2)
|
Actual covenants are calculated pursuant to the specific terms to our unsecured senior line of credit and unsecured senior bank term loan agreements.
|
Covenant Ratios
(1)
|
|
Requirement
|
|
Actual
|
Total Debt to Total Assets
|
Less than or equal to 60%
|
|
40%
|
|
Secured Debt to Total Assets
|
Less than or equal to 40%
|
|
7%
|
|
Consolidated EBITDA to Interest Expense
|
Greater than or equal to 1.5x
|
|
5.9x
|
|
Unencumbered Total Asset Value to Unsecured Debt
|
Greater than or equal to 150%
|
|
247%
|
(1)
|
For definitions of the ratios, refer to the indenture filed as Exhibit 4.3 hereto and the related supplemental indentures filed as Exhibits 4.4, 4.7, 4.9, and 4.11 hereto, which are each listed in Item 15 of this report.
|
Sources and Uses of Capital
(Dollars in thousands)
|
|
2015 Guidance
|
||||||
|
Low
|
|
High
|
|||||
Sources of capital:
|
|
|
|
|
||||
Net cash provided by operating activities after dividends
|
|
$
|
115,000
|
|
|
$
|
135,000
|
|
Incremental debt
|
|
390,000
|
|
|
470,000
|
|
||
Remainder/asset sales
(1) (2)
|
|
340,000
|
|
|
440,000
|
|
||
Total sources of capital
|
|
$
|
845,000
|
|
|
$
|
1,045,000
|
|
|
|
|
|
|
||||
Uses of capital:
|
|
|
|
|
||||
Construction
|
|
$
|
645,000
|
|
|
$
|
745,000
|
|
Acquisitions
(3)
|
|
200,000
|
|
|
300,000
|
|
||
Total uses of capital
|
|
$
|
845,000
|
|
|
$
|
1,045,000
|
|
|
|
|
|
|
||||
Incremental debt:
|
|
|
|
|
||||
Issuance of unsecured senior and other notes payable
(4)
|
|
$
|
535,000
|
|
|
$
|
685,000
|
|
Borrowings under:
|
|
|
|
|
||||
Existing secured construction loans
|
|
80,000
|
|
|
130,000
|
|
||
Repayments of:
|
|
|
|
|
||||
Secured notes payable
|
|
(61,000
|
)
|
|
(137,000
|
)
|
||
2016 unsecured senior term loan
|
|
(150,000
|
)
|
|
(200,000
|
)
|
||
Unsecured senior line of credit
|
|
(14,000
|
)
|
|
(8,000
|
)
|
||
Incremental debt
|
|
$
|
390,000
|
|
|
$
|
470,000
|
|
(1)
|
Represents the amount of remaining capital to be sourced in 2015. We expect to identify real estate sales, including land and non-core/“core-like” operating assets, over the next several quarters to generate proceeds for reinvestment into high-value Class A pre-leased development projects. The amount of asset sales necessary to meet our forecasted sources of capital will vary depending upon the amount of EBITDA associated with the assets sold. For example, the sale of an income-producing property benefits leverage less than the sale of a non-income-producing land parcel. Additionally, we intend to continue to execute our strategy of delivering solid growth in FFO per share, as adjusted, and NAV in 2015, including any impact of asset sales.
|
(2)
|
Assets classified as “held for sale” as of December 31, 2014, aggregated
$178.0 million
, including
$56.0 million
in sales completed in January 2015.
|
(3)
|
Includes (i) the acquisition of 640 Memorial Drive completed in January 2015 for $176.5 million and (ii) $54.1 million, representing half of the aggregate consideration of $108.3 million to purchase the outstanding 10% noncontrolling interest in our flagship campus at Alexandria Technology Square
®
, which is due on April 1, 2015. The other half of the $108.3 million will be paid on April 1, 2016, and therefore has been excluded from uses of capital for 2015.
|
(4)
|
Includes a secured note payable of $82.0 million with an interest rate of 3.93% assumed in connection with the acquisition of 640 Memorial Drive in January 2015.
|
Description
|
|
Stated
Rate
|
|
Total Aggregate
Commitments
|
|
Outstanding
Balance
|
|
Undrawn Commitments
|
||||||
$1.5 billion unsecured senior line of credit
|
|
LIBOR + 1.10%
|
|
$
|
1,500,000
|
|
|
$
|
304,000
|
|
|
$
|
1,196,000
|
|
Secured construction loan
|
|
LIBOR + 1.50%
|
|
55,000
|
|
|
46,792
|
|
|
8,208
|
|
|||
Secured construction loan
|
|
LIBOR + 1.40%
|
|
36,000
|
|
|
19,343
|
|
|
16,657
|
|
|||
Secured construction loan
|
|
LIBOR + 1.35%
|
|
250,400
|
|
|
106,093
|
|
|
144,307
|
|
|||
|
|
|
|
$
|
1,841,400
|
|
|
$
|
476,228
|
|
|
1,365,172
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
86,011
|
|
|||||
Total
|
|
|
|
|
|
|
|
$
|
1,451,183
|
|
|
December 31, 2014
|
|
December 31, 2013
|
||||
Funds held in trust under the terms of certain secured notes payable
|
$
|
19,350
|
|
|
$
|
14,572
|
|
Funds held in escrow related to construction projects
|
4,539
|
|
|
5,655
|
|
||
Other restricted funds
|
2,995
|
|
|
7,482
|
|
||
Total
|
$
|
26,884
|
|
|
$
|
27,709
|
|
Loan Collateral
|
|
Total Commitments
|
|
Total Outstanding
|
|
Partners’ Share
|
|
ARE’s
27.5% Share
|
|
Maturity Date
|
|
Interest Rate
|
||||||||||||||
360 Longwood Avenue
|
|
$
|
213,200
|
|
|
$
|
159,881
|
|
|
$
|
115,914
|
|
|
$
|
43,967
|
|
|
|
4/1/17
|
(1)
|
|
|
5.25
|
%
|
(2)
|
(1)
|
We have two, one-year options to extend the stated maturity date to April 1, 2019, subject to certain conditions.
|
(2)
|
Secured construction loan bears interest at LIBOR+3.75%, with a floor of 5.25%.
|
|
|
|
Payments by Period
|
||||||||||||||||
|
Total
|
|
2015
|
|
2016 – 2017
|
|
2018 – 2019
|
|
Thereafter
|
||||||||||
Secured and unsecured debt
(1) (2)
|
$
|
3,680,940
|
|
|
$
|
61,190
|
|
|
$
|
821,528
|
|
|
$
|
911,468
|
|
|
$
|
1,886,754
|
|
Estimated interest payments on fixed-rate and hedged variable-rate debt
(3)
|
705,834
|
|
|
105,205
|
|
|
180,103
|
|
|
159,010
|
|
|
261,516
|
|
|||||
Estimated interest payments on variable-rate debt
(4)
|
32,061
|
|
|
8,849
|
|
|
15,074
|
|
|
8,138
|
|
|
—
|
|
|||||
Ground lease obligations
|
667,082
|
|
|
9,828
|
|
|
20,942
|
|
|
19,573
|
|
|
616,739
|
|
|||||
Other obligations
|
8,299
|
|
|
1,501
|
|
|
3,051
|
|
|
3,747
|
|
|
—
|
|
|||||
Total
|
$
|
5,094,216
|
|
|
$
|
186,573
|
|
|
$
|
1,040,698
|
|
|
$
|
1,101,936
|
|
|
$
|
2,765,009
|
|
(1)
|
Amounts represent principal amounts due and exclude unamortized premiums/discounts reflected on the consolidated balance sheets.
|
(2)
|
Payment dates include any extension options that we control.
|
(3)
|
Estimated interest payments on our fixed-rate debt and hedged variable-rate debt were based upon contractual interest rates, including the impact of interest rate swap agreements, interest payment dates, and scheduled maturity dates.
|
(4)
|
The interest payments on variable-rate debt were based on the interest rates in effect as of
December 31, 2014
.
|
|
Year Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
Net cash provided by operating activities
|
$
|
334,325
|
|
|
$
|
312,727
|
|
|
$
|
21,598
|
|
Net cash used in investing activities
|
$
|
(634,829
|
)
|
|
$
|
(591,375
|
)
|
|
$
|
(43,454
|
)
|
Net cash provided by financing activities
|
$
|
331,312
|
|
|
$
|
197,570
|
|
|
$
|
133,742
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
Net cash provided by operating activities
|
$
|
334,325
|
|
|
$
|
312,727
|
|
|
$
|
21,598
|
|
Add back: changes in operating assets and liabilities
|
15,628
|
|
|
4,785
|
|
|
10,843
|
|
|||
Net cash provided by operating activities before changes in operating assets and liabilities
|
$
|
349,953
|
|
|
$
|
317,512
|
|
|
$
|
32,441
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
Proceeds from sales of properties
|
$
|
81,580
|
|
|
$
|
153,968
|
|
|
$
|
(72,388
|
)
|
Additions to properties
|
(497,773
|
)
|
|
(593,389
|
)
|
|
95,616
|
|
|||
Purchase of properties
|
(127,887
|
)
|
|
(122,069
|
)
|
|
(5,818
|
)
|
|||
Proceeds from repayment of notes receivable
|
29,883
|
|
|
—
|
|
|
29,883
|
|
|||
Investment in unconsolidated real estate entity
|
(70,758
|
)
|
|
(17,987
|
)
|
|
(52,771
|
)
|
|||
Other
|
(49,874
|
)
|
|
(11,898
|
)
|
|
(37,976
|
)
|
|||
Net cash used in investing activities
|
$
|
(634,829
|
)
|
|
$
|
(591,375
|
)
|
|
$
|
(43,454
|
)
|
|
Year Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
Borrowings from secured notes payable
|
$
|
126,215
|
|
|
$
|
28,489
|
|
|
$
|
97,726
|
|
Repayments of borrowings from secured notes payable
|
(231,051
|
)
|
|
(36,219
|
)
|
|
(194,832
|
)
|
|||
Proceeds from issuance of unsecured senior notes payable
|
698,908
|
|
|
498,561
|
|
|
200,347
|
|
|||
Principal borrowings from unsecured senior line of credit
|
1,168,000
|
|
|
729,000
|
|
|
439,000
|
|
|||
Repayments of borrowings from unsecured senior line of credit
|
(1,068,000
|
)
|
|
(1,091,000
|
)
|
|
23,000
|
|
|||
Repayments of unsecured senior bank term loan
|
(125,000
|
)
|
|
(250,000
|
)
|
|
125,000
|
|
|||
Repurchase of unsecured senior convertible notes
|
—
|
|
|
(384
|
)
|
|
384
|
|
|||
Total changes related to debt
|
569,072
|
|
|
(121,553
|
)
|
|
690,625
|
|
|||
|
|
|
|
|
|
||||||
Proceeds from common stock offerings
|
—
|
|
|
534,469
|
|
|
(534,469
|
)
|
|||
Dividend payments
|
(228,271
|
)
|
|
(194,961
|
)
|
|
(33,310
|
)
|
|||
Other
|
(9,489
|
)
|
|
(20,385
|
)
|
|
10,896
|
|
|||
Net cash provided by financing activities
|
$
|
331,312
|
|
|
$
|
197,570
|
|
|
$
|
133,742
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
Common stock dividends
|
$
|
202,386
|
|
|
$
|
169,076
|
|
|
$
|
33,310
|
|
Series D Convertible Preferred Stock dividends
|
17,500
|
|
|
17,500
|
|
|
—
|
|
|||
Series E Preferred Stock dividends
|
8,385
|
|
|
8,385
|
|
|
—
|
|
|||
|
$
|
228,271
|
|
|
$
|
194,961
|
|
|
$
|
33,310
|
|
|
|
Year Ended December 31,
|
||||||||||
(In thousands)
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net income attributable to Alexandria’s common stockholders – basic
|
|
$
|
72,113
|
|
|
$
|
108,751
|
|
|
$
|
67,630
|
|
Depreciation and amortization
|
|
224,425
|
|
|
190,778
|
|
|
192,005
|
|
|||
Impairment of real estate – rental properties
|
|
26,975
|
|
|
—
|
|
|
11,400
|
|
|||
(Gain) loss on sales of real estate – rental properties
|
|
(1,838
|
)
|
|
121
|
|
|
(1,564
|
)
|
|||
Gain on sales of real estate – land parcels
|
|
(6,403
|
)
|
|
(4,824
|
)
|
|
(1,864
|
)
|
|||
Amount attributable to noncontrolling interests/unvested restricted stock awards:
|
|
|
|
|
|
|
||||||
Net income
|
|
6,978
|
|
|
5,613
|
|
|
4,592
|
|
|||
FFO
|
|
(7,668
|
)
|
|
(5,577
|
)
|
|
(4,561
|
)
|
|||
FFO attributable to Alexandria’s common stockholders – basic
|
|
314,582
|
|
|
294,862
|
|
|
267,638
|
|
|||
Assumed conversion of unsecured senior convertible notes
|
|
—
|
|
|
15
|
|
|
21
|
|
|||
FFO attributable to Alexandria’s common stockholders – diluted
|
|
314,582
|
|
|
294,877
|
|
|
267,659
|
|
|||
Realized gain on equity investment primarily related to one non-tenant life science entity
|
|
—
|
|
|
—
|
|
|
(5,811
|
)
|
|||
Impairment of investments
|
|
—
|
|
|
853
|
|
|
—
|
|
|||
Acquisition-related expenses
|
|
—
|
|
|
1,446
|
|
|
—
|
|
|||
Impairment of real estate – land parcels
|
|
24,700
|
|
|
—
|
|
|
2,050
|
|
|||
Loss on early extinguishment of debt
|
|
525
|
|
|
1,992
|
|
|
2,225
|
|
|||
Preferred stock redemption charge
|
|
1,989
|
|
|
—
|
|
|
5,978
|
|
|||
Allocation to unvested restricted stock awards
|
|
(226
|
)
|
|
(35
|
)
|
|
(39
|
)
|
|||
FFO attributable to Alexandria’s common stockholders – diluted, as adjusted
|
|
341,570
|
|
|
299,133
|
|
|
272,062
|
|
|||
Non-revenue-enhancing capital expenditures:
|
|
|
|
|
|
|
||||||
Building improvements
|
|
(7,429
|
)
|
|
(3,461
|
)
|
|
(2,068
|
)
|
|||
Tenant improvements and leasing commissions
|
|
(15,179
|
)
|
|
(15,902
|
)
|
|
(9,181
|
)
|
|||
Straight-line rent revenue
|
|
(45,534
|
)
|
|
(27,935
|
)
|
|
(28,456
|
)
|
|||
Straight-line rent expense on ground leases
|
|
2,788
|
|
|
1,896
|
|
|
3,285
|
|
|||
Capitalized income from development projects
|
|
—
|
|
|
143
|
|
|
645
|
|
|||
Amortization of acquired above and below market leases
|
|
(2,845
|
)
|
|
(3,316
|
)
|
|
(3,200
|
)
|
|||
Amortization of loan fees
|
|
10,912
|
|
|
9,936
|
|
|
9,832
|
|
|||
Amortization of debt premiums/discounts
|
|
117
|
|
|
529
|
|
|
511
|
|
|||
Stock compensation expense
|
|
13,996
|
|
|
15,552
|
|
|
14,160
|
|
|||
Allocation to unvested restricted stock awards
|
|
359
|
|
|
191
|
|
|
127
|
|
|||
AFFO attributable to Alexandria’s common stockholders – diluted
|
|
$
|
298,755
|
|
|
$
|
276,766
|
|
|
$
|
257,717
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net income per share attributable to Alexandria’s common stockholders – basic
|
|
$
|
1.01
|
|
|
$
|
1.60
|
|
|
$
|
1.09
|
|
Depreciation and amortization
|
|
3.16
|
|
|
2.80
|
|
|
3.10
|
|
|||
Impairment of real estate – rental properties
|
|
0.38
|
|
|
—
|
|
|
0.18
|
|
|||
Gain on sales of real estate – rental properties
|
|
(0.03
|
)
|
|
—
|
|
|
(0.03
|
)
|
|||
Gain on sales of real estate – land parcels
|
|
(0.09
|
)
|
|
(0.07
|
)
|
|
(0.03
|
)
|
|||
Amount attributable to noncontrolling interests/
unvested restricted stock awards
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|||
FFO per share attributable to Alexandria’s common stockholders – basic and diluted
|
|
4.42
|
|
|
4.33
|
|
|
4.31
|
|
|||
Realized gain on equity investment primarily related to one non-tenant life science entity
|
|
—
|
|
|
—
|
|
|
(0.09
|
)
|
|||
Impairment of investments
|
|
—
|
|
|
0.01
|
|
|
—
|
|
|||
Acquisition-related expenses
|
|
—
|
|
|
0.02
|
|
|
—
|
|
|||
Impairment of real estate – land parcels
|
|
0.34
|
|
|
—
|
|
|
0.04
|
|
|||
Loss on early extinguishment of debt
|
|
0.01
|
|
|
0.04
|
|
|
0.02
|
|
|||
Preferred stock redemption charge
|
|
0.03
|
|
|
—
|
|
|
0.10
|
|
|||
FFO per share attributable to Alexandria’s common stockholders – diluted, as adjusted
|
|
4.80
|
|
|
4.40
|
|
|
4.38
|
|
|||
Non-revenue-enhancing capital expenditures
|
|
(0.31
|
)
|
|
(0.28
|
)
|
|
(0.18
|
)
|
|||
Straight-line rent revenue
|
|
(0.64
|
)
|
|
(0.41
|
)
|
|
(0.46
|
)
|
|||
Straight-line rent expense on ground leases
|
|
0.04
|
|
|
0.03
|
|
|
0.05
|
|
|||
Amortization of acquired above and below market leases
|
|
(0.04
|
)
|
|
(0.05
|
)
|
|
(0.05
|
)
|
|||
Amortization of loan fees
|
|
0.14
|
|
|
0.14
|
|
|
0.16
|
|
|||
Stock compensation expense
|
|
0.20
|
|
|
0.23
|
|
|
0.23
|
|
|||
Other
|
|
0.01
|
|
|
0.01
|
|
|
0.02
|
|
|||
AFFO per share attributable to Alexandria’s common stockholders – diluted
|
|
$
|
4.20
|
|
|
$
|
4.07
|
|
|
$
|
4.15
|
|
|
Three Months Ended December 31,
|
|
Year Ended December 31,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Net (loss) income
|
$
|
(6,030
|
)
|
|
$
|
44,222
|
|
|
$
|
106,778
|
|
|
$
|
140,249
|
|
Interest expense:
|
|
|
|
|
|
|
|
||||||||
Consolidated
|
22,188
|
|
|
17,783
|
|
|
79,299
|
|
|
67,952
|
|
||||
Unconsolidated JVs
|
35
|
|
|
—
|
|
|
35
|
|
|
—
|
|
||||
Total interest expense
|
22,223
|
|
|
17,783
|
|
|
79,334
|
|
|
67,952
|
|
||||
Depreciation and amortization:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
57,973
|
|
|
48,084
|
|
|
224,096
|
|
|
189,123
|
|
||||
Discontinued operations
|
—
|
|
|
17
|
|
|
—
|
|
|
1,655
|
|
||||
Unconsolidated JVs
|
329
|
|
|
—
|
|
|
329
|
|
|
—
|
|
||||
Total depreciation and amortization
|
58,302
|
|
|
48,101
|
|
|
224,425
|
|
|
190,778
|
|
||||
EBITDA
|
74,495
|
|
|
110,106
|
|
|
410,537
|
|
|
398,979
|
|
||||
Stock compensation expense
|
4,624
|
|
|
4,011
|
|
|
13,996
|
|
|
15,552
|
|
||||
Loss on early extinguishment of debt
|
—
|
|
|
—
|
|
|
525
|
|
|
1,992
|
|
||||
(Gain) loss on sales of real estate – rental properties
|
(1,838
|
)
|
|
—
|
|
|
(1,838
|
)
|
|
121
|
|
||||
Gain on sales of real estate – land parcels
|
(5,598
|
)
|
|
(4,052
|
)
|
|
(6,403
|
)
|
|
(4,824
|
)
|
||||
Impairment of real estate
|
51,675
|
|
|
—
|
|
|
51,675
|
|
|
—
|
|
||||
Impairment of investments
|
—
|
|
|
853
|
|
|
—
|
|
|
853
|
|
||||
Deal costs
|
—
|
|
|
1,446
|
|
|
—
|
|
|
1,446
|
|
||||
Adjusted EBITDA
|
$
|
123,358
|
|
|
$
|
112,364
|
|
|
$
|
468,492
|
|
|
$
|
414,119
|
|
|
Three Months Ended December 31,
|
|
Year Ended December 31,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Adjusted EBITDA
|
$
|
123,358
|
|
|
$
|
112,364
|
|
|
$
|
468,492
|
|
|
$
|
414,119
|
|
Add back: operating loss (income) from discontinued operations
|
116
|
|
|
126
|
|
|
605
|
|
|
(2,676
|
)
|
||||
Adjusted EBITDA – excluding discontinued operations
|
$
|
123,474
|
|
|
$
|
112,490
|
|
|
$
|
469,097
|
|
|
$
|
411,443
|
|
|
|
|
|
|
|
|
|
||||||||
Total revenues
|
$
|
188,674
|
|
|
$
|
168,823
|
|
|
$
|
726,877
|
|
|
$
|
631,151
|
|
Adjusted EBITDA margins
|
65%
|
|
|
67%
|
|
|
65%
|
|
|
65%
|
|
|
Three Months Ended December 31,
|
|
Year Ended December 31,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Adjusted EBITDA
|
$
|
123,358
|
|
|
$
|
112,364
|
|
|
$
|
468,492
|
|
|
$
|
414,119
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
$
|
22,188
|
|
|
$
|
17,783
|
|
|
$
|
79,299
|
|
|
$
|
67,952
|
|
Add: capitalized interest
|
11,665
|
|
|
14,116
|
|
|
47,105
|
|
|
60,615
|
|
||||
Less: amortization of loan fees
|
(2,822
|
)
|
|
(2,636
|
)
|
|
(10,912
|
)
|
|
(9,936
|
)
|
||||
Less: amortization of debt discounts
|
(17
|
)
|
|
(146
|
)
|
|
(117
|
)
|
|
(529
|
)
|
||||
Cash interest
|
31,014
|
|
|
29,117
|
|
|
115,375
|
|
|
118,102
|
|
||||
Dividends on preferred stock
|
6,284
|
|
|
6,471
|
|
|
25,698
|
|
|
25,885
|
|
||||
Fixed charges
|
$
|
37,298
|
|
|
$
|
35,588
|
|
|
$
|
141,073
|
|
|
$
|
143,987
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed charge coverage ratio:
|
|
|
|
|
|
|
|
||||||||
– period annualized
|
3.3x
|
|
|
3.2x
|
|
|
3.3x
|
|
|
2.9x
|
|
||||
– trailing 12 months
|
3.3x
|
|
|
2.9x
|
|
|
3.3x
|
|
|
2.9x
|
|
•
|
Initial stabilized yield: reflects rental income, including contractual rent escalations and any rent concessions over the term(s) of the lease(s), calculated on a straight-line basis.
|
•
|
Initial stabilized yield – cash basis: reflects cash rents at the stabilization date after initial rental concessions, if any, have elapsed.
|
|
As of December 31,
|
||||||
|
2014
|
|
2013
|
||||
Secured notes payable
|
$
|
652,209
|
|
|
$
|
708,831
|
|
Unsecured senior notes payable
|
1,747,370
|
|
|
1,048,230
|
|
||
Unsecured senior line of credit
|
304,000
|
|
|
204,000
|
|
||
Unsecured senior bank term loans
|
975,000
|
|
|
1,100,000
|
|
||
Less: cash and cash equivalents
|
(86,011
|
)
|
|
(57,696
|
)
|
||
Less: restricted cash
|
(26,884
|
)
|
|
(27,709
|
)
|
||
Net debt
|
$
|
3,565,684
|
|
|
$
|
2,975,656
|
|
|
|
|
|
||||
Adjusted EBITDA:
|
|
|
|
||||
– quarter annualized
|
$
|
493,432
|
|
|
$
|
449,456
|
|
– trailing 12 months
|
$
|
468,492
|
|
|
$
|
414,119
|
|
|
|
|
|
||||
Net debt to Adjusted EBITDA:
|
|
|
|
||||
– quarter annualized
|
7.2
|
x
|
|
6.6
|
x
|
||
– trailing 12 months
|
7.6
|
x
|
|
7.2
|
x
|
|
Three Months Ended December 31,
|
|
Year Ended December 31,
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Unencumbered NOI
|
$
|
111,741
|
|
|
$
|
82,267
|
|
|
$
|
426,943
|
|
|
$
|
305,028
|
|
Encumbered NOI
|
20,970
|
|
|
36,664
|
|
|
81,688
|
|
|
137,084
|
|
||||
Total NOI from continuing operations
|
$
|
132,711
|
|
|
$
|
118,931
|
|
|
$
|
508,631
|
|
|
$
|
442,112
|
|
Unencumbered NOI as a percentage of total NOI
|
84%
|
|
|
69%
|
|
|
84%
|
|
|
69%
|
|
Impact to future earnings due to variable-rate debt:
|
|
||
Rate increase of 1%
|
$
|
(3,753
|
)
|
Rate decrease of 1%
|
$
|
600
|
|
Effect on fair value of total consolidated debt and interest rate swap agreements:
|
|
||
Rate increase of 1%
|
$
|
(157,637
|
)
|
Rate decrease of 1%
|
$
|
154,355
|
|
Equity price risk:
|
|
||
Increase in fair value of 10%
|
$
|
23,639
|
|
Decrease in fair value of 10%
|
$
|
(23,639
|
)
|
Impact to potential future earnings due to foreign currency exchange rate:
|
|
||
Increase in rate of 10%
|
$
|
200
|
|
Decrease in rate of 10%
|
$
|
(200
|
)
|
Effect on the fair value of net investment in foreign subsidiaries due to foreign currency exchange rate:
|
|
||
Increase in rate of 10%
|
$
|
33,555
|
|
Decrease in rate of 10%
|
$
|
(33,555
|
)
|
|
|
Number of securities to be
issued upon exercise of
outstanding options,
warrants, and rights
(a)
|
|
Weighted average
exercise price of
outstanding options,
warrants, and rights
(b)
|
|
Number of securities
remaining available for
future issuance under
equity compensation plans
(excluding securities
reflected in column (a))
(c)
|
Equity Compensation Plan Approved by Stockholders — Amended and Restated 1997 Incentive Plan
|
|
—
|
|
—
|
|
3,093,382
|
|
Page
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
Audited Consolidated Financial Statements of Alexandria Real Estate Equities, Inc.:
|
|
Consolidated Balance Sheets as of December 31, 2014 and 2013
|
|
Consolidated Statements of Income for the Years Ended December 31, 2014, 2013, and 2012
|
|
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2014, 2013, and 2012
|
|
Consolidated Statements of Changes in Stockholders’ Equity and Noncontrolling Interests for the Years Ended December 31, 2014, 2013, and 2012
|
|
Consolidated Statements of Cash Flows for the Years Ended December 31, 2014, 2013, and 2012
|
|
Notes to Consolidated Financial Statements
|
|
Schedule III – Consolidated Financial Statement Schedule of Rental Properties and Accumulated Depreciation
|
Exhibit
Number
|
|
Exhibit Title
|
|
|
|
3.1*
|
|
Articles of Amendment and Restatement of the Company, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on August 14, 1997.
|
3.2*
|
|
Certificate of Correction of the Company, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on August 14, 1997.
|
3.3*
|
|
Bylaws of the Company (as amended December 15, 2011), filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on December 19, 2011.
|
3.4*
|
|
Articles Supplementary, dated June 9, 1999, relating to the 9.50% Series A Cumulative Redeemable Preferred Stock, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on August 13, 1999.
|
3.5*
|
|
Articles Supplementary, dated February 10, 2000, relating to the election to be subject to Subtitle 8 of Title 3 of the Maryland General Corporation Law, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on February 10, 2000.
|
3.6*
|
|
Articles Supplementary, dated February 10, 2000, relating to the Series A Junior Participating Preferred Stock, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on February 10, 2000.
|
3.7*
|
|
Articles Supplementary, dated January 18, 2002, relating to the 9.10% Series B Cumulative Redeemable Preferred Stock, filed as an exhibit to the Company’s Form 8-A for registration of certain classes of securities filed with the SEC on January 18, 2002.
|
3.8*
|
|
Articles Supplementary, dated June 22, 2004, relating to the 8.375% Series C Cumulative Redeemable Preferred Stock, filed as an exhibit to the Company’s Form 8-A for registration of certain classes of securities filed with the SEC on June 28, 2004.
|
3.9*
|
|
Articles Supplementary, dated March 25, 2008, relating to the 7.00% Series D Cumulative Convertible Preferred Stock, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on March 25, 2008.
|
3.10*
|
|
Articles Supplementary, dated March 12, 2012, relating to the 6.45% Series E Cumulative Redeemable Preferred Stock, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on March 14, 2012.
|
4.1*
|
|
Specimen certificate representing shares of common stock, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on May 5, 2011.
|
4.2*
|
|
Specimen certificate representing shares of 7.00% Series D Cumulative Convertible Preferred Stock, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on March 25, 2008.
|
4.3*
|
|
Indenture, dated as of February 29, 2012, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and The Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on February 29, 2012.
|
4.4*
|
|
Supplemental Indenture No. 1, dated as of February 29, 2012, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and The Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on February 29, 2012.
|
4.5*
|
|
Form of 4.60% Senior Note due 2022 (included in Exhibit 4.4 above).
|
4.6*
|
|
Specimen certificate representing shares of 6.45% Series E Cumulative Redeemable Preferred Stock, filed as an exhibit to the Company’s Form 8-A for registration of certain classes of securities filed with the SEC on March 12, 2012.
|
4.7*
|
|
Supplemental Indenture No. 2, dated as of June 7, 2013, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and The Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on June 7, 2013.
|
4.8*
|
|
Form of 3.90% Senior Note due 2023 (included in Exhibit 4.7 above).
|
4.9*
|
|
Supplemental Indenture No. 3, dated as of July 18, 2014, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and the Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on July 18, 2014.
|
4.10*
|
|
Form of 2.750% Senior Note due 2020 (included in Exhibit 4.9 above).
|
4.11*
|
|
Supplemental Indenture No. 4, dated as of July 18, 2014, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and the Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on July 18, 2014.
|
4.12*
|
|
Form of 4.500% Senior Note due 2029 (included in Exhibit 4.11 above).
|
10.1*
|
(1)
|
Amended and Restated 1997 Stock Award and Incentive Plan of the Company, dated May 29, 2014, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on May 29, 2014.
|
10.2*
|
(1)
|
Form of Non-Employee Director Stock Option Agreement for use in connection with options issued pursuant to the Amended and Restated 1997 Stock Award and Incentive Plan, filed as an exhibit to the Company’s Registration Statement on Form S-11 (No. 333-23545) filed with the SEC on May 5, 1997.
|
10.3*
|
(1)
|
Form of Incentive Stock Option Agreement for use in connection with options issued pursuant to the Amended and Restated 1997 Stock Award and Incentive Plan, filed as an exhibit to the Company’s Registration Statement on Form S-11 (No. 333-23545) filed with the SEC on May 5, 1997.
|
10.4*
|
(1)
|
Form of Nonqualified Stock Option Agreement for use in connection with options issued pursuant to the Amended and Restated 1997 Stock Award and Incentive Plan, filed as an exhibit to the Company’s Registration Statement on Form S-11 (No. 333-23545) filed with the SEC on May 5, 1997.
|
10.5*
|
(1)
|
Form of Employee Restricted Stock Agreement for use in connection with shares of restricted stock issued to employees pursuant to the Amended and Restated 1997 Stock Award and Incentive Plan, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 15, 1999.
|
10.6*
|
(1)
|
Form of Independent Contractor Restricted Stock Agreement for use in connection with shares of restricted stock issued to independent contractors pursuant to the Amended and Restated 1997 Stock Award and Incentive Plan, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 15, 1999.
|
10.7*
|
(1)
|
The Company’s 2000 Deferred Compensation Plan, amended and restated effective as of January 1, 2010, filed as an exhibit to the Company’s annual report on Form 10-K filed with the SEC on March 1, 2011.
|
10.8*
|
(1)
|
The Company’s 2000 Deferred Compensation Plan for Directors, amended and restated effective as of January 1, 2010, filed as an exhibit to the Company’s annual report on Form 10-K filed with the SEC on March 1, 2011.
|
10.9*
|
(1)
|
Amended and Restated Executive Employment Agreement, effective as of January 1, 2014, by and between the Company and Joel S. Marcus, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on May 1, 2014.
|
10.10*
|
(1)
|
Second Amended and Restated Executive Employment Agreement between the Company and Dean A. Shigenaga, effective as of January 1, 2010, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on May 5, 2011.
|
10.11*
|
(1)
|
Third Amended and Restated Executive Employment Agreement, dated as of October 25, 2011, between the Company and Stephen A. Richardson, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 9, 2011.
|
10.12*
|
(1)
|
Executive Employment Agreement between the Company and Peter M. Moglia, effective as of January 1, 2011, filed as an exhibit to the Company’s annual report on Form 10-K filed with the SEC on February 25, 2013.
|
10.13*
|
(1)
|
Second Amended and Restated Executive Employment Agreement between the Company and Thomas J. Andrews, effective January 1, 2011, filed as an exhibit to the Company’s annual report on Form 10-K filed with the SEC on March 3, 2014.
|
10.14*
|
(1)
|
Executive Employment Agreement between the Company and Daniel J. Ryan, effective September 7, 2010, filed as an exhibit to the Company’s annual report on Form 10-K filed with the SEC on March 3, 2014.
|
10.15
|
(1)
|
Summary of Director Compensation Arrangements.
|
10.16*
|
(1)
|
Anniversary Bonus Plan of the Company, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on June 17, 2010.
|
10.17*
|
(1)
|
Amended and Restated Consulting Agreement, dated as of September 30, 2011, between the Company and James H. Richardson, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 9, 2011.
|
10.18*
|
|
Form of Indemnification Agreement between the Company and each of its directors and officers, filed as an exhibit to the Company’s annual report on Form 10-K filed with the SEC on March 1, 2011.
|
10.19*
|
|
Indenture, dated as of February 29, 2012, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and The Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on February 29, 2012.
|
10.20*
|
|
Supplemental Indenture No. 1, dated as of February 29, 2012, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and The Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on February 29, 2012.
|
10.21*
|
|
Supplemental Indenture No. 2, dated as of June 7, 2013, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and The Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on June 7, 2013.
|
10.22*
|
|
Supplemental Indenture No. 3, dated as of July 18, 2014, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and the Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on July 18, 2014.
|
10.23*
|
|
Supplemental Indenture No. 4, dated as of July 18, 2014, among the Company, as Issuer, Alexandria Real Estate Equities, L.P., as Guarantor, and the Bank of New York Mellon Trust Company, N.A., as Trustee, filed as an exhibit to the Company’s current report on Form 8-K filed with the SEC on July 18, 2014.
|
10.24*
|
|
Fourth Amended and Restated Credit Agreement, dated as of August 30, 2013, among the Company, as Borrower, Alexandria Real Estate Equities, L.P., as Guarantor, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC, and Citigroup Global Markets Inc., as Joint Lead Arrangers and Joint Book Runners, JPMorgan Chase Bank, N.A. and Citigroup Global Markets Inc., as Co-Syndication Agents, Barclays Bank PLC, Capital One, N.A., Compass Bank, Credit Agricole Corporate and Investment Bank, Goldman Sachs Bank USA, HSBC Bank USA, National Association, Royal Bank of Canada, The Bank of Nova Scotia, and The Royal Bank of Scotland PLC, as Co-Documentation Agents, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 7, 2013.
|
10.25*
|
|
Amended and Restated Term Loan Agreement, dated as of August 30, 2013, among the Company, as Borrower, Alexandria Real Estate Equities, L.P., as Guarantor, Bank of America, N.A., as Administrative Agent, JPMorgan Chase Bank, N.A. and Citigroup Global Markets Inc., as Co-Syndication Agents, Barclays Bank PLC, Capital One, N.A., Compass Bank, Credit Agricole Corporate and Investment Bank, Goldman Sachs Bank USA, HSBC Bank USA, National Association, Royal Bank of Canada, The Bank of Nova Scotia, and The Royal Bank of Scotland PLC, as Co-Documentation Agents, and J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Citigroup Global Markets Inc., as Joint Lead Arrangers and Joint Lead Book Runners, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 7, 2013.
|
10.26*
|
|
Second Amended and Restated Term Loan Agreement, dated as of July 26, 2013, among the Company, as Borrower, Alexandria Real Estate Equities, L.P., as Guarantor, Citibank, N.A., as Administrative Agent, Royal Bank of Canada and The Royal Bank of Scotland PLC, as Co-Syndication Agents, The Bank of Nova Scotia and Compass Bank, as Co-Documentation Agents, and Citigroup Global Markets Inc., RBC Capital Markets, and RBS Securities Inc., as Joint Lead Arrangers and Joint Book Running Managers, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 7, 2013.
|
10.27*
|
|
First Amendment to Second Amended and Restated Term Loan Agreement, dated as of August 30, 2013, among the Company and Alexandria Real Estate Equities, L.P., as Credit Parties, Citibank, N.A., as Administrative Agent, Royal Bank of Canada and The Royal Bank of Scotland PLC, as Co-Syndication Agents, The Bank of Nova Scotia and Compass Bank, as Co-Documentation Agents, and Citigroup Global Markets Inc., RBC Capital Markets, and RBS Securities Inc., as Joint Lead Arrangers and Joint Book Running Managers, filed as an exhibit to the Company’s quarterly report on Form 10-Q filed with the SEC on November 7, 2013.
|
11.1
|
|
Computation of Per Share Earnings (included in Note 10 to the Consolidated Financial Statements).
|
12.1
|
|
Computation of Consolidated Ratios of Earnings to Fixed Charges and Combined Fixed Charges and Preferred Stock Dividends.
|
14.1
|
|
The Company’s Business Integrity Policy and Procedures for Reporting Non-Compliance (code of ethics pursuant to Item 406 of Regulation S-K).
|
21.1
|
|
List of Subsidiaries of the Company.
|
23.1
|
|
Consent of Ernst & Young LLP.
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.0
|
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101
|
|
The following materials from the Company’s annual report on Form 10-K for the year ended December 31, 2014, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of December 31, 2014 and 2013, (ii) Consolidated Statements of Income for the years ended December 31, 2014, 2013, and 2012, (iii) Consolidated Statements of Comprehensive Income for the years ended December 31, 2014, 2013, and 2012,
(iv) Consolidated Statements of Changes in Stockholders’ Equity and Noncontrolling Interests for the years ended December 31, 2014, 2013, and 2012, (v) Consolidated Statements of Cash Flows for the years ended December 31, 2014, 2013, and 2012, (vi) Notes to Consolidated Financial Statements, and (vii) Schedule III – Consolidated Financial Statement Schedule of Real Estate and Accumulated Depreciation of Alexandria Real Estate Equities, Inc.
|
|
|
ALEXANDRIA REAL ESTATE EQUITIES, INC.
|
Dated:
|
February 23, 2015
|
By:
/s/ Joel S. Marcus
Joel S. Marcus
Chief Executive Officer
|
Signature
|
Title
|
Date
|
/s/ Joel S. Marcus
Joel S. Marcus
|
Chairman of the Board of Directors and Chief Executive Officer (Principal Executive Officer)
|
February 23, 2015
|
/s/ Dean A. Shigenaga
Dean A. Shigenaga
|
Chief Financial Officer (Principal Financial Officer)
|
February 23, 2015
|
/s/ Richard B. Jennings
Richard B. Jennings
|
Lead Director
|
February 23, 2015
|
/s/ John L. Atkins, III
John L. Atkins, III
|
Director
|
February 23, 2015
|
/s/ Maria C. Freire
Maria C. Freire
|
Director
|
February 23, 2015
|
/s/ Steven R. Hash
Steven R. Hash
|
Director
|
February 23, 2015
|
/s/ Richard H. Klein
Richard H. Klein
|
Director
|
February 23, 2015
|
/s/ James H. Richardson
James H. Richardson
|
Director
|
February 23, 2015
|
|
December 31, 2014
|
|
December 31, 2013
|
||||
Assets
|
|
|
|
||||
Investments in real estate
|
$
|
7,226,016
|
|
|
$
|
6,776,914
|
|
Cash and cash equivalents
|
86,011
|
|
|
57,696
|
|
||
Restricted cash
|
26,884
|
|
|
27,709
|
|
||
Tenant receivables
|
10,548
|
|
|
9,918
|
|
||
Deferred rent
|
234,124
|
|
|
190,425
|
|
||
Deferred leasing and financing costs
|
201,798
|
|
|
192,658
|
|
||
Investments
|
236,389
|
|
|
140,288
|
|
||
Other assets
|
114,266
|
|
|
134,156
|
|
||
Total assets
|
$
|
8,136,036
|
|
|
$
|
7,529,764
|
|
|
|
|
|
||||
Liabilities, Noncontrolling Interests, and Equity
|
|
|
|
||||
Secured notes payable
|
$
|
652,209
|
|
|
$
|
708,831
|
|
Unsecured senior notes payable
|
1,747,370
|
|
|
1,048,230
|
|
||
Unsecured senior line of credit
|
304,000
|
|
|
204,000
|
|
||
Unsecured senior bank term loans
|
975,000
|
|
|
1,100,000
|
|
||
Accounts payable, accrued expenses, and tenant security deposits
|
489,085
|
|
|
435,342
|
|
||
Dividends payable
|
58,814
|
|
|
54,420
|
|
||
Total liabilities
|
4,226,478
|
|
|
3,550,823
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
||
|
|
|
|
||||
Redeemable noncontrolling interests
|
14,315
|
|
|
14,444
|
|
||
|
|
|
|
||||
Alexandria’s stockholders’ equity:
|
|
|
|
||||
7.00% Series D cumulative convertible preferred stock, $0.01 par value per share, 10,000,000 shares authorized; 9,486,500 and 10,000,000 shares issued and outstanding as of December 31, 2014 and 2013, respectively; $25 liquidation value per share
|
237,163
|
|
|
250,000
|
|
||
6.45% Series E cumulative redeemable preferred stock, $0.01 par value per share, 5,200,000 shares authorized, issued, and outstanding as of December 31, 2014 and 2013; $25 liquidation value per share
|
130,000
|
|
|
130,000
|
|
||
Common stock, $0.01 par value per share, 100,000,000 shares authorized; 71,463,876 and 71,172,197 issued and outstanding as of December 31, 2014 and 2013, respectively
|
715
|
|
|
712
|
|
||
Additional paid-in capital
|
3,461,189
|
|
|
3,572,281
|
|
||
Accumulated other comprehensive loss
|
(628
|
)
|
|
(36,204
|
)
|
||
Alexandria’s stockholders’ equity
|
3,828,439
|
|
|
3,916,789
|
|
||
Noncontrolling interests
|
66,804
|
|
|
47,708
|
|
||
Total equity
|
3,895,243
|
|
|
3,964,497
|
|
||
Total liabilities, noncontrolling interests, and equity
|
$
|
8,136,036
|
|
|
$
|
7,529,764
|
|
|
Year Ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Rental
|
$
|
544,153
|
|
|
$
|
467,764
|
|
|
$
|
422,793
|
|
Tenant recoveries
|
173,480
|
|
|
150,095
|
|
|
133,280
|
|
|||
Other income
|
9,244
|
|
|
13,292
|
|
|
18,424
|
|
|||
Total revenues
|
726,877
|
|
|
631,151
|
|
|
574,497
|
|
|||
|
|
|
|
|
|
||||||
Expenses:
|
|
|
|
|
|
||||||
Rental operations
|
219,164
|
|
|
189,039
|
|
|
172,756
|
|
|||
General and administrative
|
53,530
|
|
|
48,520
|
|
|
47,747
|
|
|||
Interest
|
79,299
|
|
|
67,952
|
|
|
69,184
|
|
|||
Depreciation and amortization
|
224,096
|
|
|
189,123
|
|
|
185,687
|
|
|||
Impairment of real estate
|
51,675
|
|
|
—
|
|
|
2,050
|
|
|||
Loss on early extinguishment of debt
|
525
|
|
|
1,992
|
|
|
2,225
|
|
|||
Total expenses
|
628,289
|
|
|
496,626
|
|
|
479,649
|
|
|||
|
|
|
|
|
|
||||||
Equity in earnings of unconsolidated joint ventures
|
554
|
|
|
—
|
|
|
—
|
|
|||
Income from continuing operations
|
99,142
|
|
|
134,525
|
|
|
94,848
|
|
|||
Income from discontinued operations
|
1,233
|
|
|
900
|
|
|
8,816
|
|
|||
Gain on sales of real estate – land parcels
|
6,403
|
|
|
4,824
|
|
|
1,864
|
|
|||
Net income
|
106,778
|
|
|
140,249
|
|
|
105,528
|
|
|||
|
|
|
|
|
|
||||||
Dividends on preferred stock
|
(25,698
|
)
|
|
(25,885
|
)
|
|
(27,328
|
)
|
|||
Preferred stock redemption charge
|
(1,989
|
)
|
|
—
|
|
|
(5,978
|
)
|
|||
Net income attributable to noncontrolling interests
|
(5,204
|
)
|
|
(4,032
|
)
|
|
(3,402
|
)
|
|||
Net income attributable to unvested restricted stock awards
|
(1,774
|
)
|
|
(1,581
|
)
|
|
(1,190
|
)
|
|||
Net income attributable to Alexandria’s common stockholders
|
$
|
72,113
|
|
|
$
|
108,751
|
|
|
$
|
67,630
|
|
EPS attributable to Alexandria’s common stockholders – basic and diluted:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.99
|
|
|
$
|
1.59
|
|
|
$
|
0.95
|
|
Discontinued operations
|
0.02
|
|
|
0.01
|
|
|
0.14
|
|
|||
EPS – basic and diluted
|
$
|
1.01
|
|
|
$
|
1.60
|
|
|
$
|
1.09
|
|
|
Year Ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Net income
|
$
|
106,778
|
|
|
$
|
140,249
|
|
|
$
|
105,528
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Unrealized gains (losses) on marketable securities:
|
|
|
|
|
|
||||||
Unrealized holding gains arising during the year
|
51,135
|
|
|
1,300
|
|
|
990
|
|
|||
Reclassification adjustment for gains included in net income
|
(358
|
)
|
|
(1,183
|
)
|
|
(3,351
|
)
|
|||
Unrealized gains (losses) on marketable securities, net
|
50,777
|
|
|
117
|
|
|
(2,361
|
)
|
|||
|
|
|
|
|
|
||||||
Unrealized gains on interest rate swaps:
|
|
|
|
|
|
||||||
Unrealized interest rate swap (losses) gains arising during the year
|
(4,459
|
)
|
|
1,918
|
|
|
(9,990
|
)
|
|||
Reclassification adjustment for amortization of interest expense included in net income
|
6,871
|
|
|
15,422
|
|
|
22,309
|
|
|||
Unrealized gains on interest rate swap agreements, net
|
2,412
|
|
|
17,340
|
|
|
12,319
|
|
|||
|
|
|
|
|
|
||||||
Unrealized losses on foreign currency translation:
|
|
|
|
|
|
||||||
Unrealized foreign currency translation losses arising during the year
|
(18,075
|
)
|
|
(28,912
|
)
|
|
(318
|
)
|
|||
Reclassification adjustment for gains included in net income
|
(208
|
)
|
|
—
|
|
|
—
|
|
|||
Unrealized losses on foreign currency translation, net
|
(18,283
|
)
|
|
(28,912
|
)
|
|
(318
|
)
|
|||
|
|
|
|
|
|
||||||
Total other comprehensive income (loss)
|
34,906
|
|
|
(11,455
|
)
|
|
9,640
|
|
|||
Comprehensive income
|
141,684
|
|
|
128,794
|
|
|
115,168
|
|
|||
Less: comprehensive income attributable to noncontrolling interests
|
(4,534
|
)
|
|
(3,948
|
)
|
|
(3,364
|
)
|
|||
Comprehensive income attributable to Alexandria’s common stockholders
|
$
|
137,150
|
|
|
$
|
124,846
|
|
|
$
|
111,804
|
|
|
|
Alexandria Real Estate Equities, Inc.’s Stockholders’ Equity
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||
|
|
Series C Preferred Stock
|
|
Series D
Cumulative
Convertible
Preferred
Stock
|
|
Series E
Cumulative
Redeemable
Preferred
Stock
|
|
Number of
Common
Shares
|
|
Common
Stock
|
|
Additional
Paid-In Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Noncontrolling
Interests
|
|
Total
Equity
|
|
Redeemable
Noncontrolling
Interests
|
|||||||||||||||||||||
Balance as of December 31, 2011
|
|
$
|
129,638
|
|
|
$
|
250,000
|
|
|
$
|
—
|
|
|
61,560,472
|
|
|
$
|
616
|
|
|
$
|
3,028,558
|
|
|
$
|
—
|
|
|
$
|
(34,511
|
)
|
|
$
|
42,558
|
|
|
$
|
3,416,859
|
|
|
$
|
16,034
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
102,126
|
|
|
—
|
|
|
2,429
|
|
|
104,555
|
|
|
973
|
|
||||||||||
Total other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,678
|
|
|
12
|
|
|
9,690
|
|
|
(50
|
)
|
||||||||||
Contributions by noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,875
|
|
|
1,875
|
|
|
—
|
|
||||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(913
|
)
|
|
(913
|
)
|
|
(1,249
|
)
|
||||||||||
Redemption and conversion of noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
682
|
|
|
694
|
|
|
(1,144
|
)
|
||||||||||
Issuance of common stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,366,977
|
|
|
14
|
|
|
97,876
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
97,890
|
|
|
—
|
|
||||||||||
Issuance of Series E Preferred Stock
|
|
—
|
|
|
—
|
|
|
130,000
|
|
|
—
|
|
|
—
|
|
|
(5,132
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
124,868
|
|
|
—
|
|
||||||||||
Issuances pursuant to stock plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
317,196
|
|
|
2
|
|
|
22,080
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,082
|
|
|
—
|
|
||||||||||
Redemption of Series C Preferred Stock
|
|
(129,638
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,978
|
|
|
(5,978
|
)
|
|
—
|
|
|
—
|
|
|
(129,638
|
)
|
|
—
|
|
||||||||||
Dividends declared on common stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(131,790
|
)
|
|
—
|
|
|
—
|
|
|
(131,790
|
)
|
|
—
|
|
||||||||||
Dividends declared on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,678
|
)
|
|
—
|
|
|
—
|
|
|
(27,678
|
)
|
|
—
|
|
||||||||||
Distributions in excess of earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(63,320
|
)
|
|
63,320
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Balance as of December 31, 2012
|
|
$
|
—
|
|
|
$
|
250,000
|
|
|
$
|
130,000
|
|
|
63,244,645
|
|
|
$
|
632
|
|
|
$
|
3,086,052
|
|
|
$
|
—
|
|
|
$
|
(24,833
|
)
|
|
$
|
46,643
|
|
|
$
|
3,488,494
|
|
|
$
|
14,564
|
|
|
|
Alexandria Real Estate Equities, Inc.’s Stockholders’ Equity
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||
|
|
Series C Preferred Stock
|
|
Series D
Cumulative
Convertible
Preferred
Stock
|
|
Series E
Cumulative
Redeemable
Preferred
Stock
|
|
Number of
Common
Shares
|
|
Common
Stock
|
|
Additional
Paid-In Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Noncontrolling
Interests
|
|
Total
Equity
|
|
Redeemable
Noncontrolling
Interests
|
|||||||||||||||||||||
Balance as of December 31, 2012
|
|
$
|
—
|
|
|
$
|
250,000
|
|
|
$
|
130,000
|
|
|
63,244,645
|
|
|
$
|
632
|
|
|
$
|
3,086,052
|
|
|
$
|
—
|
|
|
$
|
(24,833
|
)
|
|
$
|
46,643
|
|
|
$
|
3,488,494
|
|
|
$
|
14,564
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
136,217
|
|
|
—
|
|
|
2,961
|
|
|
139,178
|
|
|
1,071
|
|
||||||||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,371
|
)
|
|
(84
|
)
|
|
(11,455
|
)
|
|
—
|
|
||||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,812
|
)
|
|
(1,812
|
)
|
|
(1,191
|
)
|
||||||||||
Issuance of common stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,590,000
|
|
|
76
|
|
|
534,393
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
534,469
|
|
|
—
|
|
||||||||||
Issuances pursuant to stock plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
337,552
|
|
|
4
|
|
|
23,608
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,612
|
|
|
—
|
|
||||||||||
Dividends declared on common stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(182,104
|
)
|
|
—
|
|
|
—
|
|
|
(182,104
|
)
|
|
—
|
|
||||||||||
Dividends declared on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,885
|
)
|
|
—
|
|
|
—
|
|
|
(25,885
|
)
|
|
—
|
|
||||||||||
Distributions in excess of earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(71,772
|
)
|
|
71,772
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Balance as of December 31, 2013
|
|
$
|
—
|
|
|
$
|
250,000
|
|
|
$
|
130,000
|
|
|
71,172,197
|
|
|
$
|
712
|
|
|
$
|
3,572,281
|
|
|
$
|
—
|
|
|
$
|
(36,204
|
)
|
|
$
|
47,708
|
|
|
$
|
3,964,497
|
|
|
$
|
14,444
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
101,574
|
|
|
—
|
|
|
4,142
|
|
|
105,716
|
|
|
1,062
|
|
||||||||||
Total other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35,576
|
|
|
(670
|
)
|
|
34,906
|
|
|
—
|
|
||||||||||
Contributions by noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,410
|
|
|
19,410
|
|
|
—
|
|
||||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,786
|
)
|
|
(3,786
|
)
|
|
(1,191
|
)
|
||||||||||
Issuances pursuant to stock plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
291,679
|
|
|
3
|
|
|
21,576
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,579
|
|
|
—
|
|
||||||||||
Redemption of Series D Preferred Stock
|
|
—
|
|
|
(12,837
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
412
|
|
|
(1,989
|
)
|
|
—
|
|
|
—
|
|
|
(14,414
|
)
|
|
—
|
|
||||||||||
Dividends declared on common stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(206,967
|
)
|
|
—
|
|
|
—
|
|
|
(206,967
|
)
|
|
—
|
|
||||||||||
Dividends declared on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,698
|
)
|
|
—
|
|
|
—
|
|
|
(25,698
|
)
|
|
—
|
|
||||||||||
Distributions in excess of earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(133,080
|
)
|
|
133,080
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Balance as of December 31, 2014
|
|
$
|
—
|
|
|
$
|
237,163
|
|
|
$
|
130,000
|
|
|
71,463,876
|
|
|
$
|
715
|
|
|
$
|
3,461,189
|
|
|
$
|
—
|
|
|
$
|
(628
|
)
|
|
$
|
66,804
|
|
|
$
|
3,895,243
|
|
|
$
|
14,315
|
|
Alexandria Real Estate Equities, Inc.
Consolidated Statements of Cash Flows
(In thousands)
|
|||||||||||
|
Year Ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Operating Activities
|
|
|
|
|
|
||||||
Net income
|
$
|
106,778
|
|
|
$
|
140,249
|
|
|
$
|
105,528
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
224,096
|
|
|
190,778
|
|
|
192,005
|
|
|||
Loss on early extinguishment of debt
|
525
|
|
|
1,992
|
|
|
2,225
|
|
|||
(Gain) loss on sales of real estate
|
(1,838
|
)
|
|
121
|
|
|
(1,564
|
)
|
|||
Impairment of real estate
|
51,675
|
|
|
—
|
|
|
13,450
|
|
|||
Gain on sales of real estate – land parcels
|
(6,403
|
)
|
|
(4,824
|
)
|
|
(1,864
|
)
|
|||
Equity in earnings from unconsolidated joint ventures
|
(554
|
)
|
|
—
|
|
|
—
|
|
|||
Distributions of earnings from unconsolidated joint ventures
|
549
|
|
|
—
|
|
|
—
|
|
|||
Amortization of loan fees and costs
|
10,909
|
|
|
9,936
|
|
|
9,832
|
|
|||
Amortization of debt premiums/discounts
|
117
|
|
|
529
|
|
|
511
|
|
|||
Amortization of acquired above and below market leases
|
(2,845
|
)
|
|
(3,316
|
)
|
|
(3,200
|
)
|
|||
Deferred rent
|
(44,726
|
)
|
|
(27,935
|
)
|
|
(28,456
|
)
|
|||
Stock compensation expense
|
13,996
|
|
|
15,552
|
|
|
14,160
|
|
|||
Investment gains
|
(11,613
|
)
|
|
(7,050
|
)
|
|
(15,018
|
)
|
|||
Investment losses
|
9,287
|
|
|
1,480
|
|
|
2,637
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Restricted cash
|
4,141
|
|
|
899
|
|
|
(261
|
)
|
|||
Tenant receivables
|
(673
|
)
|
|
(1,519
|
)
|
|
(981
|
)
|
|||
Deferred leasing costs
|
(38,282
|
)
|
|
(54,825
|
)
|
|
(45,099
|
)
|
|||
Other assets
|
(7,466
|
)
|
|
(6,298
|
)
|
|
(4,069
|
)
|
|||
Accounts payable, accrued expenses, and tenant security deposits
|
26,652
|
|
|
56,958
|
|
|
65,697
|
|
|||
Net cash provided by operating activities
|
334,325
|
|
|
312,727
|
|
|
305,533
|
|
|||
|
|
|
|
|
|
||||||
Investing Activities
|
|
|
|
|
|
||||||
Proceeds from sales of real estate
|
81,580
|
|
|
153,968
|
|
|
36,179
|
|
|||
Additions to real estate
|
(497,773
|
)
|
|
(593,389
|
)
|
|
(549,030
|
)
|
|||
Purchase of real estate
|
(127,887
|
)
|
|
(122,069
|
)
|
|
(42,171
|
)
|
|||
Deposits for investing activities
|
(10,282
|
)
|
|
—
|
|
|
—
|
|
|||
Change in restricted cash related to construction projects
|
1,665
|
|
|
7,655
|
|
|
(9,377
|
)
|
|||
Investment in unconsolidated joint venture
|
(70,758
|
)
|
|
(17,987
|
)
|
|
(6,700
|
)
|
|||
Distributions from unconsolidated joint venture
|
—
|
|
|
—
|
|
|
22,250
|
|
|||
Additions to investments
|
(60,230
|
)
|
|
(36,078
|
)
|
|
(36,294
|
)
|
|||
Proceeds from sales of investments
|
18,973
|
|
|
16,525
|
|
|
27,043
|
|
|||
Proceeds from repayment of notes receivable
|
29,883
|
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
$
|
(634,829
|
)
|
|
$
|
(591,375
|
)
|
|
$
|
(558,100
|
)
|
|
|
|
|
|
|
1.
|
Background
|
|
|
Square Feet
(unaudited)
|
|
Operating properties
|
|
16,727,985
|
|
Development properties (includes unconsolidated JVs)
|
|
1,857,520
|
|
Redevelopment properties
|
|
143,777
|
|
Total operating and current value-creation projects
|
|
18,729,282
|
|
|
|
|
|
Near-term value-creation projects in North America (CIP)
|
|
2,715,792
|
|
Future value-creation projects
|
|
10,093,396
|
|
|
|
12,809,188
|
|
|
|
|
|
Total
|
|
31,538,470
|
|
•
|
Investment-grade client tenants represented
56%
of our total ABR;
|
•
|
Approximately
95%
of our leases (on an RSF basis) were triple net leases, requiring client tenants to pay substantially all real estate taxes, insurance, utilities, common area, and other operating expenses (including increases thereto) in addition to base rent;
|
•
|
Approximately
94%
of our leases (on an RSF basis) contained effective annual rent escalations that were either fixed (generally ranging from
3%
to
3.5%
) or indexed based on a consumer price index or other index; and
|
•
|
Approximately
93%
of our leases (on an RSF basis) provided for the recapture of certain capital expenditures (such as HVAC systems maintenance and/or replacement, roof replacement, and parking lot resurfacing) that we believe would typically be borne by the landlord in traditional office leases.
|
2.
|
Basis of presentation and summary of significant accounting policies
|
•
|
The entity does not have sufficient equity to finance its activities without additional subordinated financial support;
|
•
|
The equity holders, as a group, lack the characteristics of a controlling financial interest; or
|
•
|
The legal entity is established with non-substantive voting rights.
|
2.
|
Basis of presentation and summary of significant accounting policies (continued)
|
2.
|
Basis of presentation and summary of significant accounting policies (continued)
|
2.
|
Basis of presentation and summary of significant accounting policies (continued)
|
2.
|
Basis of presentation and summary of significant accounting policies (continued)
|
2.
|
Basis of presentation and summary of significant accounting policies (continued)
|
3.
|
Investments in real estate
|
|
|
December 31, 2014
|
|
December 31, 2013
|
||||
Land (related to rental properties)
|
|
$
|
624,681
|
|
|
$
|
553,388
|
|
Buildings and building improvements
|
|
6,171,504
|
|
|
5,714,673
|
|
||
Other improvements
|
|
192,128
|
|
|
174,147
|
|
||
Rental properties
|
|
6,988,313
|
|
|
6,442,208
|
|
||
|
|
|
|
|
||||
CIP/current value-creation projects:
|
|
|
|
|
||||
Current development in North America
|
|
500,894
|
|
|
511,838
|
|
||
Current redevelopment in North America
|
|
42,482
|
|
|
8,856
|
|
||
Current development in Asia
|
|
14,065
|
|
|
60,928
|
|
||
|
|
557,441
|
|
|
581,622
|
|
||
|
|
|
|
|
||||
Near-term value-creation projects in North America (CIP):
|
|
|
|
|
||||
50, 60, and 100 Binney Street
|
|
321,907
|
|
|
284,672
|
|
||
Other projects
|
|
107,471
|
|
|
97,617
|
|
||
|
|
429,378
|
|
|
382,289
|
|
||
|
|
|
|
|
||||
Future value-creation projects:
|
|
|
|
|
||||
North America
|
|
175,175
|
|
|
176,063
|
|
||
Asia
|
|
78,548
|
|
|
77,251
|
|
||
|
|
253,723
|
|
|
253,314
|
|
||
|
|
|
|
|
||||
Land under sales contract
|
|
—
|
|
|
22,943
|
|
||
Near-term and future value-creation projects
|
|
683,101
|
|
|
658,546
|
|
||
|
|
|
|
|
||||
Gross investments in real estate
|
|
8,228,855
|
|
|
7,682,376
|
|
||
Equity method of accounting – unconsolidated joint ventures
|
|
117,406
|
|
|
46,644
|
|
||
Gross investments in real estate – including unconsolidated joint ventures
|
|
8,346,261
|
|
|
7,729,020
|
|
||
Less: accumulated depreciation
|
|
(1,120,245
|
)
|
|
(952,106
|
)
|
||
Investments in real estate
|
|
$
|
7,226,016
|
|
|
$
|
6,776,914
|
|
3.
|
Investments in real estate (continued)
|
|
|
December 31, 2014
|
|
December 31, 2013
|
||||
Acquired below market leases
|
|
$
|
55,955
|
|
|
$
|
55,599
|
|
Accumulated amortization
|
|
(47,145
|
)
|
|
(44,194
|
)
|
||
|
|
$
|
8,810
|
|
|
$
|
11,405
|
|
Year
|
|
Amount
|
|
||
2015
|
|
$
|
2,861
|
|
|
2016
|
|
2,455
|
|
|
|
2017
|
|
2,251
|
|
|
|
2018
|
|
705
|
|
|
|
2019
|
|
209
|
|
|
|
Thereafter
|
|
329
|
|
|
|
Total
|
|
$
|
8,810
|
|
|
|
|
December 31, 2014
|
|
December 31, 2013
|
||||
Acquired in-place leases
|
|
$
|
51,395
|
|
|
$
|
48,189
|
|
Accumulated amortization
|
|
(32,123
|
)
|
|
(28,927
|
)
|
||
|
|
$
|
19,272
|
|
|
$
|
19,262
|
|
3.
|
Investments in real estate (continued)
|
Year
|
|
Amount
|
|
||
2015
|
|
$
|
3,663
|
|
|
2016
|
|
2,709
|
|
|
|
2017
|
|
2,513
|
|
|
|
2018
|
|
2,377
|
|
|
|
2019
|
|
2,095
|
|
|
|
Thereafter
|
|
5,915
|
|
|
|
Total
|
|
$
|
19,272
|
|
|
Year
|
|
Amount
|
|
||
2015
|
|
$
|
496,797
|
|
|
2016
|
|
488,626
|
|
|
|
2017
|
|
466,829
|
|
|
|
2018
|
|
423,234
|
|
|
|
2019
|
|
373,509
|
|
|
|
Thereafter
|
|
1,995,904
|
|
|
|
Total
|
|
$
|
4,244,899
|
|
|
3.
|
Investments in real estate (continued)
|
3.
|
Investments in real estate (continued)
|
•
|
Traditional predevelopment costs, including entitlement, design, construction drawings, BIM (3-D virtual modeling), budgeting, sustainability and energy optimization reviews, permitting, and planning for all aspects of the project; and
|
•
|
Site and infrastructure construction costs, including belowground site work, utility connections, land grading, drainage, egress and regress access points, foundation, and other costs to prepare the site for construction of aboveground building improvements. For example, site and infrastructure costs for the
1.0 million
RSF primarily related to 50, 60, and 100 Binney Street at our Alexandria Center
®
at Kendall Square project are classified as predevelopment prior to commencement of vertical construction.
|
|
|
December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Deferred leasing costs
|
|
$
|
333,109
|
|
|
$
|
293,879
|
|
Accumulated amortization
|
|
(174,194
|
)
|
|
(146,881
|
)
|
||
|
|
158,915
|
|
|
146,998
|
|
||
|
|
|
|
|
||||
Deferred financing costs
|
|
126,687
|
|
|
118,078
|
|
||
Accumulated amortization
|
|
(83,804
|
)
|
|
(72,418
|
)
|
||
|
|
42,883
|
|
|
45,660
|
|
||
Deferred leasing and financing costs
|
|
$
|
201,798
|
|
|
$
|
192,658
|
|
5.
|
Investments
|
|
December 31,
|
||||||
|
2014
|
|
2013
|
||||
“Available-for-sale” marketable equity securities, at cost basis
|
$
|
21,898
|
|
|
$
|
2,879
|
|
Unrealized gains
|
53,625
|
|
|
2,177
|
|
||
Unrealized losses
|
(1,258
|
)
|
|
(587
|
)
|
||
“Available-for-sale” marketable equity securities, at fair value
|
74,265
|
|
|
4,469
|
|
||
Investments accounted for under cost method
|
162,124
|
|
|
135,819
|
|
||
Investments
|
$
|
236,389
|
|
|
$
|
140,288
|
|
6.
|
Fair value measurements
|
|
|
|
|
December 31, 2014
|
||||||||||||
Description
|
|
Total
|
|
Quoted Prices in
Active Markets
for Identical
Assets
|
|
Significant
Other
Observable
Inputs
|
|
Significant
Unobservable
Inputs
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
“Available-for-sale securities”
|
|
$
|
74,265
|
|
|
$
|
74,265
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
|
$
|
909
|
|
|
$
|
—
|
|
|
$
|
909
|
|
|
$
|
—
|
|
|
|
|
|
December 31, 2013
|
||||||||||||
Description
|
|
Total
|
|
Quoted Prices in
Active Markets
for Identical
Assets
|
|
Significant
Other
Observable
Inputs
|
|
Significant
Unobservable
Inputs
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
“Available-for-sale securities”
|
|
$
|
4,469
|
|
|
$
|
4,469
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest rate swap agreements
|
|
$
|
2,870
|
|
|
$
|
—
|
|
|
$
|
2,870
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
|
$
|
6,191
|
|
|
$
|
—
|
|
|
$
|
6,191
|
|
|
$
|
—
|
|
6.
|
Fair value measurements (continued)
|
|
December 31, 2014
|
|
December 31, 2013
|
||||||||||||
|
Book Value
|
|
Fair Value
|
|
Book Value
|
|
Fair Value
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Marketable equity securities
|
$
|
74,265
|
|
|
$
|
74,265
|
|
|
$
|
4,469
|
|
|
$
|
4,469
|
|
Interest rate swap agreements
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,870
|
|
|
$
|
2,870
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
$
|
909
|
|
|
$
|
909
|
|
|
$
|
6,191
|
|
|
$
|
6,191
|
|
Secured notes payable
|
$
|
652,209
|
|
|
$
|
693,338
|
|
|
$
|
708,831
|
|
|
$
|
736,772
|
|
Unsecured senior notes payable
|
$
|
1,747,370
|
|
|
$
|
1,793,255
|
|
|
$
|
1,048,230
|
|
|
$
|
1,043,125
|
|
Unsecured senior line of credit
|
$
|
304,000
|
|
|
$
|
304,369
|
|
|
$
|
204,000
|
|
|
$
|
193,714
|
|
Unsecured senior bank term loans
|
$
|
975,000
|
|
|
$
|
976,010
|
|
|
$
|
1,100,000
|
|
|
$
|
1,099,897
|
|
7.
|
Secured and unsecured senior debt
|
|
Fixed Rate/Hedged
Variable Rate
|
|
Unhedged
Variable Rate
|
|
Total
Consolidated
|
|
Percentage of Total Debt
|
|
Weighted Average
Interest Rate at
End of Period
(1)
|
|
Weighted Average
Remaining Term
(in years)
|
||||||||
Secured notes payable
|
$
|
403,981
|
|
|
$
|
248,228
|
|
|
$
|
652,209
|
|
|
17.7
|
%
|
|
4.59
|
%
|
|
2.7
|
Unsecured senior notes payable
|
1,747,370
|
|
|
—
|
|
|
1,747,370
|
|
|
47.5
|
|
|
3.98
|
|
|
8.3
|
|||
$1.5 billion unsecured senior line of credit
|
—
|
|
|
304,000
|
|
|
304,000
|
|
|
8.3
|
|
|
1.27
|
|
|
4.0
|
|||
2016 Unsecured Senior Bank Term Loan
|
350,000
|
|
|
25,000
|
|
|
375,000
|
|
|
10.2
|
|
|
1.42
|
|
|
1.6
|
|||
2019 Unsecured Senior Bank Term Loan
|
600,000
|
|
|
—
|
|
|
600,000
|
|
|
16.3
|
|
|
1.67
|
|
|
4.0
|
|||
Total/weighted average
|
$
|
3,101,351
|
|
|
$
|
577,228
|
|
|
$
|
3,678,579
|
|
|
100.0
|
%
|
|
3.23
|
%
|
|
5.6
|
Percentage of total debt
|
84%
|
|
|
16%
|
|
|
100%
|
|
|
|
|
|
|
|
(1)
|
Represents the weighted average interest rate as of the end of the period plus the impact of debt premiums/discounts and our interest rate swap agreements. The weighted average interest rate excludes bank fees and amortization of loan fees.
|
7.
|
Secured and unsecured senior debt (continued)
|
|
|
Stated
Rate
|
|
Weighted Average
Interest Rate
(1)
|
|
Maturity Date
(2)
|
|
Principal Payments Remaining for the Period Ending December 31,
|
|
|
|
|
||||||||||||||||||||||||
Debt
|
|
|
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
Thereafter
|
|
Total
|
|||||||||||||||||||
Secured notes payable
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Maryland
|
|
5.64
|
%
|
|
4.50
|
%
|
|
6/1/15
|
|
$
|
5,777
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,777
|
|
San Francisco Bay Area
|
|
L+1.50
|
|
|
1.66
|
|
|
7/1/15
|
|
46,792
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,792
|
|
|||||||
Greater Boston, San Francisco Bay Area, and San Diego
|
|
5.73
|
|
|
5.73
|
|
|
1/1/16
|
|
1,815
|
|
|
75,501
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
77,316
|
|
|||||||
Greater Boston, San Diego, and New York City
|
|
5.82
|
|
|
5.82
|
|
|
4/1/16
|
|
988
|
|
|
29,389
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30,377
|
|
|||||||
San Diego
|
|
5.74
|
|
|
3.00
|
|
|
4/15/16
|
|
175
|
|
|
6,916
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,091
|
|
|||||||
San Francisco Bay Area
|
|
L+1.40
|
|
|
1.56
|
|
|
6/1/16
|
|
—
|
|
|
19,343
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,343
|
|
|||||||
San Francisco Bay Area
|
|
6.35
|
|
|
6.35
|
|
|
8/1/16
|
|
2,652
|
|
|
126,715
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
129,367
|
|
|||||||
Maryland
|
|
2.15
|
|
|
2.15
|
|
|
1/20/17
|
|
—
|
|
|
—
|
|
|
76,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
76,000
|
|
|||||||
Greater Boston
|
|
L+1.35
|
|
|
1.52
|
|
|
8/23/17
|
|
—
|
|
|
—
|
|
|
106,093
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
106,093
|
|
|||||||
San Diego, Maryland, and Seattle
|
|
7.75
|
|
|
7.75
|
|
|
4/1/20
|
|
1,570
|
|
|
1,696
|
|
|
1,832
|
|
|
1,979
|
|
|
2,138
|
|
|
104,352
|
|
|
113,567
|
|
|||||||
San Diego
|
|
4.66
|
|
|
4.66
|
|
|
1/1/23
|
|
1,403
|
|
|
1,464
|
|
|
1,540
|
|
|
1,614
|
|
|
1,692
|
|
|
31,674
|
|
|
39,387
|
|
|||||||
San Francisco Bay Area
|
|
6.50
|
|
|
6.50
|
|
|
6/1/37
|
|
18
|
|
|
19
|
|
|
20
|
|
|
22
|
|
|
23
|
|
|
728
|
|
|
830
|
|
|||||||
Unamortized premiums
|
|
|
|
|
|
|
|
|
|
214
|
|
|
55
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
269
|
|
|||||||
Secured notes payable average/subtotal
|
|
4.63
|
%
|
|
4.59
|
|
|
|
|
61,404
|
|
|
261,098
|
|
|
185,485
|
|
|
3,615
|
|
|
3,853
|
|
|
136,754
|
|
|
652,209
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
2016 Unsecured Senior Bank Term Loan
|
|
L+1.20
|
%
|
|
1.42
|
|
|
7/31/16
|
|
—
|
|
|
375,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
375,000
|
|
|||||||
2019 Unsecured Senior Bank Term Loan
|
|
L+1.20
|
%
|
|
1.67
|
|
|
1/3/19
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
600,000
|
|
|
—
|
|
|
600,000
|
|
|||||||
$1.5 billion unsecured senior line of credit
|
|
L+1.10
|
%
|
(3)
|
1.27
|
|
|
1/3/19
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
304,000
|
|
|
—
|
|
|
304,000
|
|
|||||||
Unsecured senior notes payable
|
|
2.75
|
%
|
|
2.79
|
|
|
1/15/20
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
400,000
|
|
|
400,000
|
|
|||||||
Unsecured senior notes payable
|
|
4.60
|
%
|
|
4.61
|
|
|
4/1/22
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
550,000
|
|
|
550,000
|
|
|||||||
Unsecured senior notes payable
|
|
3.90
|
%
|
|
3.94
|
|
|
6/15/23
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
500,000
|
|
|
500,000
|
|
|||||||
Unsecured senior notes payable
|
|
4.50
|
%
|
|
4.51
|
|
|
7/30/29
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
300,000
|
|
|
300,000
|
|
|||||||
Unamortized discounts
|
|
|
|
|
|
|
|
|
|
(326
|
)
|
|
(337
|
)
|
|
(350
|
)
|
|
(362
|
)
|
|
(375
|
)
|
|
(880
|
)
|
|
(2,630
|
)
|
|||||||
Unsecured debt average/subtotal
|
|
|
|
|
2.94
|
|
|
|
|
(326
|
)
|
|
374,663
|
|
|
(350
|
)
|
|
(362
|
)
|
|
903,625
|
|
|
1,749,120
|
|
|
3,026,370
|
|
|||||||
Average/total
|
|
|
|
|
3.23
|
%
|
|
|
|
$
|
61,078
|
|
|
$
|
635,761
|
|
|
$
|
185,135
|
|
|
$
|
3,253
|
|
|
$
|
907,478
|
|
|
$
|
1,885,874
|
|
|
$
|
3,678,579
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balloon payments
|
|
|
|
|
|
|
|
|
|
$
|
52,532
|
|
|
$
|
631,243
|
|
|
$
|
182,093
|
|
|
$
|
—
|
|
|
$
|
904,000
|
|
|
$
|
1,880,238
|
|
|
$
|
3,650,106
|
|
Principal amortization
|
|
|
|
|
|
|
|
|
|
8,546
|
|
|
4,518
|
|
|
3,042
|
|
|
3,253
|
|
|
3,478
|
|
|
5,636
|
|
|
28,473
|
|
|||||||
Total consolidated debt
|
|
|
|
|
|
|
|
|
|
$
|
61,078
|
|
|
$
|
635,761
|
|
|
$
|
185,135
|
|
|
$
|
3,253
|
|
|
$
|
907,478
|
|
|
$
|
1,885,874
|
|
|
$
|
3,678,579
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fixed-rate/hedged variable-rate debt
|
|
|
|
|
|
|
|
|
|
$
|
14,286
|
|
|
$
|
591,418
|
|
|
$
|
3,042
|
|
|
$
|
3,253
|
|
|
$
|
603,478
|
|
|
$
|
1,885,874
|
|
|
$
|
3,101,351
|
|
Unhedged variable-rate debt
|
|
|
|
|
|
|
|
|
|
46,792
|
|
|
44,343
|
|
|
182,093
|
|
|
—
|
|
|
304,000
|
|
|
—
|
|
|
577,228
|
|
|||||||
Total consolidated debt
|
|
|
|
|
|
|
|
|
|
$
|
61,078
|
|
|
$
|
635,761
|
|
|
$
|
185,135
|
|
|
$
|
3,253
|
|
|
$
|
907,478
|
|
|
$
|
1,885,874
|
|
|
$
|
3,678,579
|
|
(1)
|
Represents the weighted average interest rate as of the end of the period plus the impact of debt premiums/discounts and our interest rate swap agreements. The weighted average interest rate excludes bank fees and amortization of loan fees.
|
(2)
|
Includes any extension options that we control.
|
(3)
|
In addition to the stated rate, the unsecured senior line of credit is subject to an annual facility fee of
0.20%
, based on the aggregate commitments outstanding.
|
7.
|
Secured and unsecured senior debt (continued)
|
Debt Covenant Ratios
(1)
|
|
Requirement
|
Total Debt to Total Assets
|
Less than or equal to 60%
|
|
Secured Debt to Total Assets
|
Less than or equal to 40%
|
|
Consolidated EBITDA to Interest Expense
|
Greater than or equal to 1.5x
|
|
Unencumbered Total Asset Value to Unsecured Debt
|
Greater than or equal to 150%
|
(1)
|
For definitions of the ratios, refer to the indenture filed as Exhibit 4.3 hereto and the related supplemental indentures filed as Exhibits 4.4, 4.7, 4.9, and 4.11 hereto, which are each listed in Item 15 of this report.
|
7.
|
Secured and unsecured senior debt (continued)
|
|
|
Balance as of December 31, 2014
|
|
As of December 31, 2014
|
||||||
Facility
|
|
|
Maturity Date
(1)
|
|
Applicable Rate
|
|
Facility Fee
|
|||
2016 Unsecured Senior Bank Term Loan
|
|
$
|
375
|
million
|
|
July 2016
|
|
L+1.20%
|
|
N/A
|
2019 Unsecured Senior Bank Term Loan
|
|
$
|
600
|
million
|
|
January 2019
|
|
L+1.20%
|
|
N/A
|
$1.5 billion unsecured senior line of credit
|
|
$
|
304
|
million
|
|
January 2019
|
|
L+1.10%
|
|
0.20%
|
(1)
|
Includes any extension options that we control.
|
Covenant Ratios
(1)
|
|
Requirement
|
Leverage Ratio
|
|
Less than or equal to 60.0%
|
Secured Debt Ratio
|
|
Less than or equal to 45.0%
|
Fixed Charge Coverage Ratio
|
|
Greater than or equal to 1.50x
|
Unsecured Leverage Ratio
|
|
Less than or equal to 60.0%
|
Unsecured Interest Coverage Ratio
|
|
Greater than or equal to 1.50x
|
(1)
|
For definitions of the ratios, refer to the amended unsecured senior line of credit and unsecured senior bank term loan agreements filed as Exhibits 10.24, 10.25, 10.26, and 10.27 hereto, which are listed in Item 15 of this report.
|
7.
|
Secured and unsecured senior debt (continued)
|
|
Year Ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Gross interest
|
$
|
126,404
|
|
|
$
|
128,567
|
|
|
$
|
131,935
|
|
Capitalized interest
|
(47,105
|
)
|
|
(60,615
|
)
|
|
(62,751
|
)
|
|||
Interest expense
(1)
|
$
|
79,299
|
|
|
$
|
67,952
|
|
|
$
|
69,184
|
|
Market
|
|
Stated Rate
|
|
Maturity Date
|
|
Outstanding Balance
|
|
Remaining Commitments
|
|
Total Aggregate Commitments
|
||||||||||
San Francisco Bay Area
|
|
|
L+1.50
|
%
|
|
7/1/15
|
(1)
|
|
$
|
46,792
|
|
|
$
|
8,208
|
|
|
$
|
55,000
|
|
|
San Francisco Bay Area
|
|
|
L+1.40
|
%
|
|
6/1/16
|
(2)
|
|
19,343
|
|
|
16,657
|
|
|
36,000
|
|
||||
Greater Boston
|
|
|
L+1.35
|
%
|
|
8/23/17
|
(3)
|
|
106,093
|
|
|
144,307
|
|
|
250,400
|
|
||||
|
|
|
|
|
|
|
|
|
|
$
|
172,228
|
|
|
$
|
169,172
|
|
|
$
|
341,400
|
|
(1)
|
We have
two
, one-year options to extend the stated maturity date to July 1, 2017, subject to certain conditions.
|
(2)
|
We have
two
, one-year options to extend the stated maturity date to June 1, 2018, subject to certain conditions.
|
(3)
|
We have a
one
-year option to extend the stated maturity date to August 23, 2018, subject to certain conditions.
|
8.
|
Interest rate swap agreements
|
8.
|
Interest rate swap agreements (continued)
|
Effective Date
|
|
Maturity Date
|
|
Number of Contracts
|
|
Weighted Average Interest Pay
Rate (1) |
|
Fair Value as of 12/31/14
|
|
Notional Amount in Effect as of
|
||||||||||||
|
|
|
|
|
12/31/14
|
|
12/31/15
|
|
12/31/16
|
|||||||||||||
December 31, 2013
|
|
March 31, 2015
|
|
2
|
|
0.23%
|
|
$
|
(43
|
)
|
|
$
|
250,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
March 31, 2014
|
|
March 31, 2015
|
|
4
|
|
0.21%
|
|
(22
|
)
|
|
200,000
|
|
|
—
|
|
|
—
|
|
||||
December 31, 2014
|
|
March 31, 2016
|
|
3
|
|
0.53%
|
|
(625
|
)
|
|
500,000
|
|
|
500,000
|
|
|
—
|
|
||||
March 31, 2016
|
|
March 31, 2017
|
|
3
|
|
1.40%
|
|
(219
|
)
|
|
—
|
|
|
—
|
|
|
500,000
|
|
||||
Total
|
|
|
|
|
|
|
|
$
|
(909
|
)
|
|
$
|
950,000
|
|
|
$
|
500,000
|
|
|
$
|
500,000
|
|
(1)
|
In addition to the interest pay rate for each swap agreement, interest is also payable at an applicable margin for borrowings outstanding as of
December 31, 2014
. Borrowings under our unsecured senior bank term loans include an applicable margin of
1.20%
and borrowings outstanding under our unsecured senior line of credit include an applicable margin of
1.10%
.
|
|
December 31,
|
||||||
|
2014
|
|
2013
|
||||
Accounts payable and accrued expenses
|
$
|
127,828
|
|
|
$
|
98,037
|
|
Accrued construction
|
91,110
|
|
|
78,098
|
|
||
Acquired below market leases
|
8,810
|
|
|
11,405
|
|
||
Conditional asset retirement obligations
|
9,108
|
|
|
7,386
|
|
||
Deferred rent liability
|
36,231
|
|
|
35,134
|
|
||
Interest rate swap liabilities
|
909
|
|
|
6,191
|
|
||
Prepaid rent and tenant security deposits
|
193,699
|
|
|
188,241
|
|
||
Other liabilities
|
21,390
|
|
|
10,850
|
|
||
Total
|
$
|
489,085
|
|
|
$
|
435,342
|
|
10.
|
Earnings per share
|
|
Year Ended December 31,
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Income from continuing operations
|
$
|
99,142
|
|
|
$
|
134,525
|
|
|
$
|
94,848
|
|
Gain on sales of real estate – land parcels
|
6,403
|
|
|
4,824
|
|
|
1,864
|
|
|||
Net income attributable to noncontrolling interests
|
(5,204
|
)
|
|
(4,032
|
)
|
|
(3,402
|
)
|
|||
Dividends on preferred stock
|
(25,698
|
)
|
|
(25,885
|
)
|
|
(27,328
|
)
|
|||
Preferred stock redemption charge
|
(1,989
|
)
|
|
—
|
|
|
(5,978
|
)
|
|||
Net income attributable to unvested restricted stock awards
|
(1,774
|
)
|
|
(1,581
|
)
|
|
(1,190
|
)
|
|||
Income from continuing operations attributable to Alexandria’s common stockholders – basic and diluted
|
70,880
|
|
|
107,851
|
|
|
58,814
|
|
|||
Income from discontinued operations
|
1,233
|
|
|
900
|
|
|
8,816
|
|
|||
Net income attributable to Alexandria’s common stockholders – basic and diluted
|
$
|
72,113
|
|
|
$
|
108,751
|
|
|
$
|
67,630
|
|
|
|
|
|
|
|
||||||
Weighted average shares of common stock outstanding – basic and diluted
|
71,170
|
|
|
68,038
|
|
|
62,160
|
|
|||
|
|
|
|
|
|
||||||
EPS attributable to Alexandria’s common stockholders – basic and diluted:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.99
|
|
|
$
|
1.59
|
|
|
$
|
0.95
|
|
Discontinued operations
|
0.02
|
|
|
0.01
|
|
|
0.14
|
|
|||
EPS – basic and diluted
|
$
|
1.01
|
|
|
$
|
1.60
|
|
|
$
|
1.09
|
|
10.
|
Earnings per share (continued)
|
11.
|
Income taxes
|
|
|
Year ended December 31,
|
||||||
|
|
2013
|
|
2012
|
||||
Net income
|
|
$
|
140,249
|
|
|
$
|
105,528
|
|
Net income attributable to noncontrolling interests
|
|
(4,032
|
)
|
|
(3,402
|
)
|
||
Book/tax differences:
|
|
|
|
|
||||
Rental revenue recognition
|
|
16,800
|
|
|
11,607
|
|
||
Depreciation and amortization
|
|
12,936
|
|
|
15,501
|
|
||
Share-based compensation
|
|
13,754
|
|
|
11,488
|
|
||
Interest income (expense)
|
|
356
|
|
|
(8,068
|
)
|
||
Sales of property
|
|
(14,284
|
)
|
|
394
|
|
||
Impairments
|
|
—
|
|
|
13,450
|
|
||
Other
|
|
10,284
|
|
|
2,268
|
|
||
Taxable income, before dividend deduction
|
|
176,063
|
|
|
148,766
|
|
||
Dividend deduction necessary to eliminate taxable income
(1)
|
|
(176,063
|
)
|
|
(148,766
|
)
|
||
Estimated income subject to federal income tax
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Total common stock and preferred stock dividend distributions paid were approximately
$195.0 million
and
$154.3 million
for the years ended
December 31, 2013
and
2012
, respectively.
|
11.
|
Income taxes (continued)
|
12.
|
Commitments and contingencies
|
12.
|
Commitments and contingencies (continued)
|
Year
|
|
Office Leases
|
|
Ground Leases
|
|
Total
|
||||||
2015
|
|
$
|
1,501
|
|
|
$
|
9,828
|
|
|
$
|
11,329
|
|
2016
|
|
1,490
|
|
|
10,436
|
|
|
11,926
|
|
|||
2017
|
|
1,561
|
|
|
10,506
|
|
|
12,067
|
|
|||
2018
|
|
1,632
|
|
|
10,595
|
|
|
12,227
|
|
|||
2019
|
|
2,115
|
|
|
8,978
|
|
|
11,093
|
|
|||
Thereafter
|
|
—
|
|
|
616,739
|
|
|
616,739
|
|
|||
|
|
$
|
8,299
|
|
|
$
|
667,082
|
|
|
$
|
675,381
|
|
13.
|
Stockholders’ equity
|
|
Unrealized Gain on Marketable Securities
|
|
Unrealized Loss on Interest Rate
Swap Agreements
|
|
Unrealized Loss on Foreign Currency Translation
|
|
Total
|
||||||||
Balance as of December 31, 2013
|
$
|
1,590
|
|
|
$
|
(3,321
|
)
|
|
$
|
(34,473
|
)
|
|
$
|
(36,204
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss) before reclassifications
|
51,135
|
|
|
(4,459
|
)
|
|
(18,075
|
)
|
|
28,601
|
|
||||
Amounts reclassified from other comprehensive (loss) income
|
(358
|
)
|
|
6,871
|
|
|
(208
|
)
|
|
6,305
|
|
||||
Amounts attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
670
|
|
|
670
|
|
||||
Net other comprehensive income (loss)
|
50,777
|
|
|
2,412
|
|
|
(17,613
|
)
|
|
35,576
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Balance as of December 31, 2014
|
$
|
52,367
|
|
|
$
|
(909
|
)
|
|
$
|
(52,086
|
)
|
|
$
|
(628
|
)
|
14.
|
Share-based compensation
|
|
|
Number of
Stock Options
|
|
Intrinsic Value of Options Exercised
|
|||
Outstanding as of December 31, 2011
|
|
3,600
|
|
|
|
||
Granted
|
|
—
|
|
|
|
||
Exercised
|
|
(3,600
|
)
|
|
$
|
94,968
|
|
Forfeited
|
|
—
|
|
|
|
||
Outstanding as of December 31, 2012
|
|
—
|
|
|
|
||
Granted
|
|
—
|
|
|
|
||
Outstanding as of December 31, 2013
|
|
—
|
|
|
|
|
|
Granted
|
|
—
|
|
|
|
||
Outstanding as of December 31, 2014
|
|
—
|
|
|
|
14.
|
Share-based compensation (continued)
|
|
|
|
|
Number of Share Awards
|
|
Weighted Average
Grant Date
Fair Value Per Share
|
|||||||||
Outstanding as of December 31, 2011
|
|
|
|
550,763
|
|
|
$
|
71.04
|
|
|
|||||
Granted
|
|
|
|
310,240
|
|
|
$
|
72.85
|
|
|
|||||
Vested
|
|
|
|
(297,669
|
)
|
|
$
|
68.52
|
|
|
|||||
Forfeited
|
|
|
|
(2,266
|
)
|
|
$
|
74.30
|
|
|
|||||
Outstanding as of December 31, 2012
|
|
|
|
561,068
|
|
|
$
|
73.37
|
|
|
|||||
Granted
|
|
|
|
338,915
|
|
|
$
|
63.74
|
|
|
|||||
Vested
|
|
|
|
(323,594
|
)
|
|
$
|
71.78
|
|
|
|||||
Forfeited
|
|
|
|
(6,616
|
)
|
|
$
|
72.96
|
|
|
|||||
Outstanding as of December 31, 2013
|
|
|
|
569,773
|
|
|
$
|
68.54
|
|
|
|||||
Granted
|
|
|
|
416,954
|
|
|
$
|
72.25
|
|
|
|||||
Vested
|
|
|
|
(286,681
|
)
|
|
$
|
72.91
|
|
|
|||||
Forfeited
|
|
|
|
(25,077
|
)
|
|
$
|
55.72
|
|
|
|||||
Outstanding as of December 31, 2014
|
|
|
|
674,969
|
|
|
$
|
69.46
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|||||||
|
|
Year Ended December 31,
|
|||||||||||||
(In thousands)
|
|
2014
|
|
2013
|
|
2012
|
|||||||||
Total fair value of share awards vested
|
|
$
|
20,903
|
|
|
$
|
23,228
|
|
|
$
|
20,396
|
|
|||
Total compensation recognized for awards, net of capitalization
|
|
$
|
13,996
|
|
|
$
|
15,552
|
|
|
$
|
14,160
|
|
|||
Capitalized stock compensation
|
|
$
|
7,583
|
|
|
$
|
8,193
|
|
|
$
|
7,768
|
|
15.
|
Noncontrolling interests
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Income from continuing operations attributable to Alexandria
|
|
$
|
100,341
|
|
|
$
|
135,317
|
|
|
$
|
93,310
|
|
Income from discontinued operations
|
|
$
|
1,233
|
|
|
$
|
900
|
|
|
$
|
8,816
|
|
16.
|
Discontinued Operations/Assets “Held for Sale”
|
|
As of December 31,
|
||||||
|
2014
|
|
2013
|
||||
Properties “held for sale”
|
$
|
173,706
|
|
|
$
|
7,644
|
|
Other assets
|
10,147
|
|
|
103
|
|
||
Total assets
|
183,853
|
|
|
7,747
|
|
||
|
|
|
|
||||
Total liabilities
|
(6,044
|
)
|
|
(266
|
)
|
||
Net assets “held for sale”
(1)
|
$
|
177,809
|
|
|
$
|
7,481
|
|
(1)
|
As of
December 31, 2014
, net assets “held for sale” was comprised of the
five
properties which were “held for sale”, including the
two
properties subsequently sold in January 2015, and
one
property classified as “held for sale” and included in discontinued operations prior to the adoption of the ASU.
|
16.
|
Discontinued Operations/Assets “Held for Sale” (continued)
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Total revenues
|
|
$
|
—
|
|
|
$
|
4,657
|
|
|
$
|
36,283
|
|
Operating expenses
|
|
(605
|
)
|
|
(1,981
|
)
|
|
(11,313
|
)
|
|||
Total revenues less operating expenses from discontinued operations
|
|
(605
|
)
|
|
2,676
|
|
|
24,970
|
|
|||
Depreciation expense
|
|
—
|
|
|
(1,655
|
)
|
|
(6,318
|
)
|
|||
Gain (loss) on sales of real estate
|
|
1,838
|
|
|
(121
|
)
|
|
1,564
|
|
|||
Impairment of real estate
|
|
—
|
|
|
—
|
|
|
(11,400
|
)
|
|||
Income from discontinued operations
(1)
|
|
$
|
1,233
|
|
|
$
|
900
|
|
|
$
|
8,816
|
|
(1)
|
Income from discontinued operations includes the results of operations of
three
properties that were disposed of during the year ended
December 31, 2014
, and the results of
one
property which was classified as “held for sale” prior to adoption of the new ASU and included as discontinued operations as of
December 31, 2014
, as well as the results of operations (prior to disposition) and gain (loss) on sale of real estate attributable to
16
properties sold during the period from January 1, 2012, to
December 31, 2014
.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Total revenues
|
|
$
|
9,661
|
|
|
$
|
9,975
|
|
|
$
|
9,604
|
|
Operating expenses
|
|
(3,760
|
)
|
|
(3,525
|
)
|
|
(3,156
|
)
|
|||
Total revenues less operating expenses from assets classified as “held for sale”, not qualifying as discontinued operations
|
|
5,901
|
|
|
6,450
|
|
|
6,448
|
|
|||
Depreciation expense
|
|
(7,005
|
)
|
|
(7,189
|
)
|
|
(7,103
|
)
|
|||
Impairment of real estate
|
|
(26,975
|
)
|
|
—
|
|
|
—
|
|
|||
Loss from assets classified as "held for sale", not qualifying as discontinued operations
(1)
|
|
$
|
(28,079
|
)
|
|
$
|
(739
|
)
|
|
$
|
(655
|
)
|
(1)
|
Includes the results of operations of
four
properties with an aggregate
1,036,585
RSF that were classified as “held for sale” as of
December 31, 2014
, but do not qualify for classification as discontinued operations. In January 2015, we subsequently sold
two
of these properties with an aggregate
802,399
RSF. For additional information, refer to the section titled “Basis of Presentation and Summary of Significant Accounting Policies” in Note 2 to our audited consolidated financial statements under Item 15 of this Report. As of December 31, 2013, and 2012, we did not have any assets classified as “held for sale”, not qualifying as discontinued operations.
|
17.
|
Quarterly financial data (unaudited)
|
|
|
Quarter
|
|
||||||||||||||
2014
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
||||||||
Revenues
|
|
$
|
176,186
|
|
|
$
|
176,402
|
|
|
$
|
185,615
|
|
|
$
|
188,674
|
|
|
Net income (loss) attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
|
$
|
32,709
|
|
|
$
|
27,932
|
|
|
$
|
27,626
|
|
|
$
|
(16,154
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
(1)
|
|
$
|
0.46
|
|
|
$
|
0.39
|
|
|
$
|
0.39
|
|
|
$
|
(0.23
|
)
|
(2)
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Quarter
|
|
||||||||||||||
2013
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
||||||||
Revenues
|
|
$
|
150,083
|
|
|
$
|
153,930
|
|
|
$
|
158,315
|
|
|
$
|
168,823
|
|
|
Net income attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
|
$
|
22,442
|
|
|
$
|
25,483
|
|
|
$
|
24,579
|
|
|
$
|
36,247
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
(1)
|
|
$
|
0.36
|
|
|
$
|
0.38
|
|
|
$
|
0.35
|
|
|
$
|
0.51
|
|
|
(1)
|
Quarterly earnings per common share amounts may not total to the annual amounts due to rounding and due to the increase in the weighted average shares of common stock outstanding.
|
(2)
|
Results for the fourth quarter of 2014 include an aggregate net loss of
$46.2 million
, or
$0.65
per share, related to impairments of real estate and a preferred stock redemption charge, partially offset by gains on sales of real estate. See further discussion of impairments of real estate and gains on real estate in Note 3 – “Investments in Real Estate.”
|
18.
|
Subsequent events
|
19.
|
Condensed consolidating financial information
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria Real Estate Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,226,016
|
|
|
$
|
—
|
|
|
$
|
7,226,016
|
|
Cash and cash equivalents
|
52,491
|
|
|
63
|
|
|
33,457
|
|
|
—
|
|
|
86,011
|
|
|||||
Restricted cash
|
67
|
|
|
—
|
|
|
26,817
|
|
|
—
|
|
|
26,884
|
|
|||||
Tenant receivables
|
—
|
|
|
—
|
|
|
10,548
|
|
|
—
|
|
|
10,548
|
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
234,124
|
|
|
—
|
|
|
234,124
|
|
|||||
Deferred leasing and financing costs
|
35,462
|
|
|
—
|
|
|
166,336
|
|
|
—
|
|
|
201,798
|
|
|||||
Investments
|
—
|
|
|
5,235
|
|
|
231,154
|
|
|
—
|
|
|
236,389
|
|
|||||
Investments in and advances to affiliates
|
6,874,866
|
|
|
6,295,852
|
|
|
128,943
|
|
|
(13,299,661
|
)
|
|
—
|
|
|||||
Other assets
|
19,461
|
|
|
—
|
|
|
94,805
|
|
|
—
|
|
|
114,266
|
|
|||||
Total assets
|
$
|
6,982,347
|
|
|
$
|
6,301,150
|
|
|
$
|
8,152,200
|
|
|
$
|
(13,299,661
|
)
|
|
$
|
8,136,036
|
|
Liabilities, Noncontrolling Interests, and Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Secured notes payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
652,209
|
|
|
$
|
—
|
|
|
$
|
652,209
|
|
Unsecured senior notes payable
|
1,747,370
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,747,370
|
|
|||||
Unsecured senior line of credit
|
304,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
304,000
|
|
|||||
Unsecured senior bank term loans
|
975,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
975,000
|
|
|||||
Accounts payable, accrued expenses, and tenant security deposits
|
69,013
|
|
|
—
|
|
|
420,072
|
|
|
—
|
|
|
489,085
|
|
|||||
Dividends payable
|
58,525
|
|
|
—
|
|
|
289
|
|
|
—
|
|
|
58,814
|
|
|||||
Total liabilities
|
3,153,908
|
|
|
—
|
|
|
1,072,570
|
|
|
—
|
|
|
4,226,478
|
|
|||||
Redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
14,315
|
|
|
—
|
|
|
14,315
|
|
|||||
Alexandria’s stockholders’ equity
|
3,828,439
|
|
|
6,301,150
|
|
|
6,998,511
|
|
|
(13,299,661
|
)
|
|
3,828,439
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
66,804
|
|
|
—
|
|
|
66,804
|
|
|||||
Total equity
|
3,828,439
|
|
|
6,301,150
|
|
|
7,065,315
|
|
|
(13,299,661
|
)
|
|
3,895,243
|
|
|||||
Total liabilities, noncontrolling interests, and equity
|
$
|
6,982,347
|
|
|
$
|
6,301,150
|
|
|
$
|
8,152,200
|
|
|
$
|
(13,299,661
|
)
|
|
$
|
8,136,036
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria
Real Estate
Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,776,914
|
|
|
$
|
—
|
|
|
$
|
6,776,914
|
|
Cash and cash equivalents
|
14,790
|
|
|
—
|
|
|
42,906
|
|
|
—
|
|
|
57,696
|
|
|||||
Restricted cash
|
55
|
|
|
—
|
|
|
27,654
|
|
|
—
|
|
|
27,709
|
|
|||||
Tenant receivables
|
—
|
|
|
—
|
|
|
9,918
|
|
|
—
|
|
|
9,918
|
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
190,425
|
|
|
—
|
|
|
190,425
|
|
|||||
Deferred leasing and financing costs
|
36,901
|
|
|
—
|
|
|
155,757
|
|
|
—
|
|
|
192,658
|
|
|||||
Investments
|
—
|
|
|
10,868
|
|
|
129,420
|
|
|
—
|
|
|
140,288
|
|
|||||
Investments in and advances to affiliates
|
6,299,551
|
|
|
5,823,058
|
|
|
119,421
|
|
|
(12,242,030
|
)
|
|
—
|
|
|||||
Other assets
|
20,226
|
|
|
—
|
|
|
113,930
|
|
|
—
|
|
|
134,156
|
|
|||||
Total assets
|
$
|
6,371,523
|
|
|
$
|
5,833,926
|
|
|
$
|
7,566,345
|
|
|
$
|
(12,242,030
|
)
|
|
$
|
7,529,764
|
|
Liabilities, Noncontrolling Interests, and Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Secured notes payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
708,831
|
|
|
$
|
—
|
|
|
$
|
708,831
|
|
Unsecured senior notes payable
|
1,048,230
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,048,230
|
|
|||||
Unsecured senior line of credit
|
204,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
204,000
|
|
|||||
Unsecured senior bank term loans
|
1,100,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,100,000
|
|
|||||
Accounts payable, accrued expenses, and tenant security deposits
|
48,373
|
|
|
—
|
|
|
386,969
|
|
|
—
|
|
|
435,342
|
|
|||||
Dividends payable
|
54,131
|
|
|
—
|
|
|
289
|
|
|
—
|
|
|
54,420
|
|
|||||
Total liabilities
|
2,454,734
|
|
|
—
|
|
|
1,096,089
|
|
|
—
|
|
|
3,550,823
|
|
|||||
Redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
14,444
|
|
|
—
|
|
|
14,444
|
|
|||||
Alexandria’s stockholders’ equity
|
3,916,789
|
|
|
5,833,926
|
|
|
6,408,104
|
|
|
(12,242,030
|
)
|
|
3,916,789
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
47,708
|
|
|
—
|
|
|
47,708
|
|
|||||
Total equity
|
3,916,789
|
|
|
5,833,926
|
|
|
6,455,812
|
|
|
(12,242,030
|
)
|
|
3,964,497
|
|
|||||
Total liabilities, noncontrolling interests, and equity
|
$
|
6,371,523
|
|
|
$
|
5,833,926
|
|
|
$
|
7,566,345
|
|
|
$
|
(12,242,030
|
)
|
|
$
|
7,529,764
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria
Real Estate
Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
544,153
|
|
|
$
|
—
|
|
|
$
|
544,153
|
|
Tenant recoveries
|
—
|
|
|
—
|
|
|
173,480
|
|
|
—
|
|
|
173,480
|
|
|||||
Other income (expense)
|
12,006
|
|
|
(3,277
|
)
|
|
14,845
|
|
|
(14,330
|
)
|
|
9,244
|
|
|||||
Total revenues
|
12,006
|
|
|
(3,277
|
)
|
|
732,478
|
|
|
(14,330
|
)
|
|
726,877
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental operations
|
—
|
|
|
—
|
|
|
219,164
|
|
|
—
|
|
|
219,164
|
|
|||||
General and administrative
|
45,793
|
|
|
—
|
|
|
22,067
|
|
|
(14,330
|
)
|
|
53,530
|
|
|||||
Interest
|
58,159
|
|
|
—
|
|
|
21,140
|
|
|
—
|
|
|
79,299
|
|
|||||
Depreciation and amortization
|
5,748
|
|
|
—
|
|
|
218,348
|
|
|
—
|
|
|
224,096
|
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
51,675
|
|
|
—
|
|
|
51,675
|
|
|||||
Loss on early extinguishment of debt
|
525
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
525
|
|
|||||
Total expenses
|
110,225
|
|
|
—
|
|
|
532,394
|
|
|
(14,330
|
)
|
|
628,289
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings of unconsolidated JVs
|
—
|
|
|
—
|
|
|
554
|
|
|
—
|
|
|
554
|
|
|||||
Equity in earnings of affiliates
|
199,800
|
|
|
188,269
|
|
|
3,665
|
|
|
(391,734
|
)
|
|
—
|
|
|||||
Income from continuing operations
|
101,581
|
|
|
184,992
|
|
|
204,303
|
|
|
(391,734
|
)
|
|
99,142
|
|
|||||
(Loss) income from discontinued operations
|
(7
|
)
|
|
—
|
|
|
1,240
|
|
|
—
|
|
|
1,233
|
|
|||||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
6,403
|
|
|
—
|
|
|
6,403
|
|
|||||
Net income
|
101,574
|
|
|
184,992
|
|
|
211,946
|
|
|
(391,734
|
)
|
|
106,778
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends on preferred stock
|
(25,698
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,698
|
)
|
|||||
Preferred stock redemption charge
|
(1,989
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,989
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(5,204
|
)
|
|
—
|
|
|
(5,204
|
)
|
|||||
Net income attributable to unvested restricted stock awards
|
(1,774
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,774
|
)
|
|||||
Net income attributable to Alexandria’s common stockholders
|
$
|
72,113
|
|
|
$
|
184,992
|
|
|
$
|
206,742
|
|
|
$
|
(391,734
|
)
|
|
$
|
72,113
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria
Real Estate
Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
467,764
|
|
|
$
|
—
|
|
|
$
|
467,764
|
|
Tenant recoveries
|
—
|
|
|
—
|
|
|
150,095
|
|
|
—
|
|
|
150,095
|
|
|||||
Other income (expense)
|
10,423
|
|
|
(74
|
)
|
|
15,912
|
|
|
(12,969
|
)
|
|
13,292
|
|
|||||
Total revenues
|
10,423
|
|
|
(74
|
)
|
|
633,771
|
|
|
(12,969
|
)
|
|
631,151
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental operations
|
—
|
|
|
—
|
|
|
189,039
|
|
|
—
|
|
|
189,039
|
|
|||||
General and administrative
|
43,528
|
|
|
—
|
|
|
17,961
|
|
|
(12,969
|
)
|
|
48,520
|
|
|||||
Interest
|
43,284
|
|
|
—
|
|
|
24,668
|
|
|
—
|
|
|
67,952
|
|
|||||
Depreciation and amortization
|
5,907
|
|
|
—
|
|
|
183,216
|
|
|
—
|
|
|
189,123
|
|
|||||
Loss on early extinguishment of debt
|
1,992
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,992
|
|
|||||
Total expenses
|
94,711
|
|
|
—
|
|
|
414,884
|
|
|
(12,969
|
)
|
|
496,626
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings of affiliates
|
220,158
|
|
|
205,993
|
|
|
4,067
|
|
|
(430,218
|
)
|
|
—
|
|
|||||
Income from continuing operations
|
135,870
|
|
|
205,919
|
|
|
222,954
|
|
|
(430,218
|
)
|
|
134,525
|
|
|||||
Income from discontinued operations
|
347
|
|
|
—
|
|
|
553
|
|
|
—
|
|
|
900
|
|
|||||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
4,824
|
|
|
—
|
|
|
4,824
|
|
|||||
Net income
|
136,217
|
|
|
205,919
|
|
|
228,331
|
|
|
(430,218
|
)
|
|
140,249
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends on preferred stock
|
(25,885
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,885
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(4,032
|
)
|
|
—
|
|
|
(4,032
|
)
|
|||||
Net income attributable to unvested restricted stock awards
|
(1,581
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,581
|
)
|
|||||
Net income attributable to Alexandria’s common stockholders
|
$
|
108,751
|
|
|
$
|
205,919
|
|
|
$
|
224,299
|
|
|
$
|
(430,218
|
)
|
|
$
|
108,751
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria
Real Estate
Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
422,793
|
|
|
$
|
—
|
|
|
$
|
422,793
|
|
Tenant recoveries
|
—
|
|
|
—
|
|
|
133,280
|
|
|
—
|
|
|
133,280
|
|
|||||
Other income
|
6,891
|
|
|
1,292
|
|
|
23,294
|
|
|
(13,053
|
)
|
|
18,424
|
|
|||||
Total revenues
|
6,891
|
|
|
1,292
|
|
|
579,367
|
|
|
(13,053
|
)
|
|
574,497
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental operations
|
—
|
|
|
—
|
|
|
172,756
|
|
|
—
|
|
|
172,756
|
|
|||||
General and administrative
|
44,306
|
|
|
3
|
|
|
16,491
|
|
|
(13,053
|
)
|
|
47,747
|
|
|||||
Interest
|
46,677
|
|
|
—
|
|
|
22,507
|
|
|
—
|
|
|
69,184
|
|
|||||
Depreciation and amortization
|
5,384
|
|
|
—
|
|
|
180,303
|
|
|
—
|
|
|
185,687
|
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
2,050
|
|
|
—
|
|
|
2,050
|
|
|||||
Loss on early extinguishment of debt
|
2,225
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,225
|
|
|||||
Total expenses
|
98,592
|
|
|
3
|
|
|
394,107
|
|
|
(13,053
|
)
|
|
479,649
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings of affiliates
|
194,566
|
|
|
183,139
|
|
|
3,638
|
|
|
(381,343
|
)
|
|
—
|
|
|||||
Income from continuing operations
|
102,865
|
|
|
184,428
|
|
|
188,898
|
|
|
(381,343
|
)
|
|
94,848
|
|
|||||
(Loss) income from discontinued operations
|
(739
|
)
|
|
—
|
|
|
9,555
|
|
|
—
|
|
|
8,816
|
|
|||||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
1,864
|
|
|
—
|
|
|
1,864
|
|
|||||
Net income
|
102,126
|
|
|
184,428
|
|
|
200,317
|
|
|
(381,343
|
)
|
|
105,528
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends on preferred stock
|
(27,328
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,328
|
)
|
|||||
Preferred stock redemption charge
|
(5,978
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,978
|
)
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(3,402
|
)
|
|
—
|
|
|
(3,402
|
)
|
|||||
Net income attributable to unvested restricted stock awards
|
(1,190
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,190
|
)
|
|||||
Net income attributable to Alexandria’s common stockholders
|
$
|
67,630
|
|
|
$
|
184,428
|
|
|
$
|
196,915
|
|
|
$
|
(381,343
|
)
|
|
$
|
67,630
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria
Real Estate
Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
101,574
|
|
|
$
|
184,992
|
|
|
$
|
211,946
|
|
|
$
|
(391,734
|
)
|
|
$
|
106,778
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains on marketable securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized holding gains arising during the year
|
—
|
|
|
148
|
|
|
50,987
|
|
|
—
|
|
|
51,135
|
|
|||||
Reclassification adjustment for losses (gains) included in net income
|
—
|
|
|
292
|
|
|
(650
|
)
|
|
—
|
|
|
(358
|
)
|
|||||
Unrealized gains on marketable securities
|
—
|
|
|
440
|
|
|
50,337
|
|
|
—
|
|
|
50,777
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains on interest rate swap agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized interest rate swap losses arising during the year
|
(4,459
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,459
|
)
|
|||||
Reclassification adjustment for amortization of interest expense included in net income
|
6,871
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,871
|
|
|||||
Unrealized gains on interest rate swap agreements
|
2,412
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,412
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized losses on foreign currency translation:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized foreign currency translation losses arising during the year
|
(318
|
)
|
|
—
|
|
|
(17,757
|
)
|
|
—
|
|
|
(18,075
|
)
|
|||||
Reclassification adjustment for gains included in net income
|
—
|
|
|
—
|
|
|
(208
|
)
|
|
—
|
|
|
(208
|
)
|
|||||
Unrealized losses on foreign currency translation
|
(318
|
)
|
|
—
|
|
|
(17,965
|
)
|
|
—
|
|
|
(18,283
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total other comprehensive income
|
2,094
|
|
|
440
|
|
|
32,372
|
|
|
—
|
|
|
34,906
|
|
|||||
Comprehensive income
|
103,668
|
|
|
185,432
|
|
|
244,318
|
|
|
(391,734
|
)
|
|
141,684
|
|
|||||
Less: comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(4,534
|
)
|
|
—
|
|
|
(4,534
|
)
|
|||||
Comprehensive income attributable to Alexandria’s common stockholders
|
$
|
103,668
|
|
|
$
|
185,432
|
|
|
$
|
239,784
|
|
|
$
|
(391,734
|
)
|
|
$
|
137,150
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria
Real Estate
Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
136,217
|
|
|
$
|
205,919
|
|
|
$
|
228,331
|
|
|
$
|
(430,218
|
)
|
|
$
|
140,249
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized (losses) gains on marketable securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized holding (losses) gains arising during the year
|
—
|
|
|
(438
|
)
|
|
1,738
|
|
|
—
|
|
|
1,300
|
|
|||||
Reclassification adjustment for losses (gains) included in net income
|
—
|
|
|
148
|
|
|
(1,331
|
)
|
|
—
|
|
|
(1,183
|
)
|
|||||
Unrealized (losses) gains on marketable securities
|
—
|
|
|
(290
|
)
|
|
407
|
|
|
—
|
|
|
117
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains on interest rate swap agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized interest rate swap gains arising during the year
|
1,918
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,918
|
|
|||||
Reclassification adjustment for amortization of interest expense included in net income
|
15,422
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,422
|
|
|||||
Unrealized gains on interest rate swap agreements
|
17,340
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,340
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized foreign currency translation losses
|
—
|
|
|
—
|
|
|
(28,912
|
)
|
|
—
|
|
|
(28,912
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total other comprehensive income (loss)
|
17,340
|
|
|
(290
|
)
|
|
(28,505
|
)
|
|
—
|
|
|
(11,455
|
)
|
|||||
Comprehensive income
|
153,557
|
|
|
205,629
|
|
|
199,826
|
|
|
(430,218
|
)
|
|
128,794
|
|
|||||
Less: comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(3,948
|
)
|
|
—
|
|
|
(3,948
|
)
|
|||||
Comprehensive income attributable to Alexandria’s common stockholders
|
$
|
153,557
|
|
|
$
|
205,629
|
|
|
$
|
195,878
|
|
|
$
|
(430,218
|
)
|
|
$
|
124,846
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria
Real Estate
Equities, Inc.
(Issuer)
|
|
Alexandria
Real Estate
Equities, L.P.
(Guarantor
Subsidiary)
|
|
Combined
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
102,126
|
|
|
$
|
184,428
|
|
|
$
|
200,317
|
|
|
$
|
(381,343
|
)
|
|
$
|
105,528
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized (losses) gains on marketable securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized holding (losses) gains arising during the year
|
—
|
|
|
(319
|
)
|
|
1,309
|
|
|
—
|
|
|
990
|
|
|||||
Reclassification adjustment for losses (gains) included in net income
|
—
|
|
|
155
|
|
|
(3,506
|
)
|
|
—
|
|
|
(3,351
|
)
|
|||||
Unrealized losses on marketable securities
|
—
|
|
|
(164
|
)
|
|
(2,197
|
)
|
|
—
|
|
|
(2,361
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains on interest rate swaps:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized interest rate swap losses arising during the year
|
(9,990
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,990
|
)
|
|||||
Reclassification adjustment for amortization of interest expense included in net income
|
22,309
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,309
|
|
|||||
Unrealized gains on interest rate swaps
|
12,319
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,319
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized foreign currency translation losses
|
—
|
|
|
—
|
|
|
(318
|
)
|
|
—
|
|
|
(318
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total other comprehensive income (loss)
|
12,319
|
|
|
(164
|
)
|
|
(2,515
|
)
|
|
—
|
|
|
9,640
|
|
|||||
Comprehensive income
|
114,445
|
|
|
184,264
|
|
|
197,802
|
|
|
(381,343
|
)
|
|
115,168
|
|
|||||
Less: comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(3,364
|
)
|
|
—
|
|
|
(3,364
|
)
|
|||||
Comprehensive income attributable to Alexandria’s common stockholders
|
$
|
114,445
|
|
|
$
|
184,264
|
|
|
$
|
194,438
|
|
|
$
|
(381,343
|
)
|
|
$
|
111,804
|
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria Real
Estate Equities,
Inc. (Issuer)
|
|
Alexandria Real
Estate Equities,
L.P. (Guarantor
Subsidiary)
|
|
Combined
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
101,574
|
|
|
$
|
184,992
|
|
|
$
|
211,946
|
|
|
$
|
(391,734
|
)
|
|
$
|
106,778
|
|
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
5,748
|
|
|
—
|
|
|
218,348
|
|
|
—
|
|
|
224,096
|
|
|||||
Loss on early extinguishment of debt
|
525
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
525
|
|
|||||
Gain on sales of real estate – rental properties
|
—
|
|
|
—
|
|
|
(1,838
|
)
|
|
—
|
|
|
(1,838
|
)
|
|||||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
(6,403
|
)
|
|
—
|
|
|
(6,403
|
)
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
51,675
|
|
|
—
|
|
|
51,675
|
|
|||||
Equity in earnings from unconsolidated joint ventures
|
—
|
|
|
—
|
|
|
(554
|
)
|
|
—
|
|
|
(554
|
)
|
|||||
Distributions of earnings from unconsolidated joint ventures
|
—
|
|
|
—
|
|
|
549
|
|
|
—
|
|
|
549
|
|
|||||
Amortization of loan fees and costs
|
7,355
|
|
|
—
|
|
|
3,554
|
|
|
—
|
|
|
10,909
|
|
|||||
Amortization of debt premiums/discounts
|
232
|
|
|
—
|
|
|
(115
|
)
|
|
—
|
|
|
117
|
|
|||||
Amortization of acquired below market leases
|
—
|
|
|
—
|
|
|
(2,845
|
)
|
|
—
|
|
|
(2,845
|
)
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
(44,726
|
)
|
|
—
|
|
|
(44,726
|
)
|
|||||
Stock compensation expense
|
13,996
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,996
|
|
|||||
Equity in earnings of affiliates
|
(199,800
|
)
|
|
(188,269
|
)
|
|
(3,665
|
)
|
|
391,734
|
|
|
—
|
|
|||||
Investment gains
|
—
|
|
|
—
|
|
|
(11,613
|
)
|
|
—
|
|
|
(11,613
|
)
|
|||||
Investment losses
|
—
|
|
|
3,047
|
|
|
6,240
|
|
|
—
|
|
|
9,287
|
|
|||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Restricted cash
|
(12
|
)
|
|
—
|
|
|
4,153
|
|
|
—
|
|
|
4,141
|
|
|||||
Tenant receivables
|
—
|
|
|
—
|
|
|
(673
|
)
|
|
—
|
|
|
(673
|
)
|
|||||
Deferred leasing costs
|
17
|
|
|
—
|
|
|
(38,299
|
)
|
|
—
|
|
|
(38,282
|
)
|
|||||
Other assets
|
(7,785
|
)
|
|
—
|
|
|
319
|
|
|
—
|
|
|
(7,466
|
)
|
|||||
Accounts payable, accrued expenses, and tenant security deposits
|
25,877
|
|
|
—
|
|
|
775
|
|
|
—
|
|
|
26,652
|
|
|||||
Net cash (used in) provided by operating activities
|
(52,273
|
)
|
|
(230
|
)
|
|
386,828
|
|
|
—
|
|
|
334,325
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sales of real estate
|
—
|
|
|
—
|
|
|
81,580
|
|
|
—
|
|
|
81,580
|
|
|||||
Additions to real estate
|
(65
|
)
|
|
—
|
|
|
(497,708
|
)
|
|
—
|
|
|
(497,773
|
)
|
|||||
Purchase of real estate
|
—
|
|
|
—
|
|
|
(127,887
|
)
|
|
—
|
|
|
(127,887
|
)
|
|||||
Deposits for investing activities
|
—
|
|
|
—
|
|
|
(10,282
|
)
|
|
—
|
|
|
(10,282
|
)
|
|||||
Change in restricted cash related to construction projects
|
—
|
|
|
—
|
|
|
1,665
|
|
|
—
|
|
|
1,665
|
|
|||||
Investment in unconsolidated joint venture
|
—
|
|
|
—
|
|
|
(70,758
|
)
|
|
—
|
|
|
(70,758
|
)
|
|||||
Investments in subsidiaries
|
(334,764
|
)
|
|
(251,358
|
)
|
|
(13,441
|
)
|
|
599,563
|
|
|
—
|
|
|||||
Additions to investments
|
—
|
|
|
(150
|
)
|
|
(60,080
|
)
|
|
—
|
|
|
(60,230
|
)
|
|||||
Proceeds from sales of investments
|
—
|
|
|
1,052
|
|
|
17,921
|
|
|
—
|
|
|
18,973
|
|
|||||
Proceeds from repayment of notes receivable
|
—
|
|
|
—
|
|
|
29,883
|
|
|
—
|
|
|
29,883
|
|
|||||
Net cash used in investing activities
|
$
|
(334,829
|
)
|
|
$
|
(250,456
|
)
|
|
$
|
(649,107
|
)
|
|
$
|
599,563
|
|
|
$
|
(634,829
|
)
|
19.
|
Condensed consolidating financial information (continued)
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria Real
Estate Equities,
Inc. (Issuer)
|
|
Alexandria Real
Estate Equities,
L.P. (Guarantor
Subsidiary)
|
|
Combined
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
136,217
|
|
|
$
|
205,919
|
|
|
$
|
228,331
|
|
|
$
|
(430,218
|
)
|
|
$
|
140,249
|
|
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
5,907
|
|
|
—
|
|
|
184,871
|
|
|
—
|
|
|
190,778
|
|
|||||
Loss on early extinguishment of debt
|
1,992
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,992
|
|
|||||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
(4,824
|
)
|
|
—
|
|
|
(4,824
|
)
|
|||||
Loss on sales of real estate – rental properties
|
—
|
|
|
—
|
|
|
121
|
|
|
—
|
|
|
121
|
|
|||||
Amortization of loan fees and costs
|
6,914
|
|
|
—
|
|
|
3,022
|
|
|
—
|
|
|
9,936
|
|
|||||
Amortization of debt premiums/discounts
|
111
|
|
|
—
|
|
|
418
|
|
|
—
|
|
|
529
|
|
|||||
Amortization of acquired below market leases
|
—
|
|
|
—
|
|
|
(3,316
|
)
|
|
—
|
|
|
(3,316
|
)
|
|||||
Deferred rent
|
(82
|
)
|
|
—
|
|
|
(27,853
|
)
|
|
—
|
|
|
(27,935
|
)
|
|||||
Stock compensation expense
|
15,552
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,552
|
|
|||||
Equity in earnings of affiliates
|
(220,158
|
)
|
|
(205,993
|
)
|
|
(4,067
|
)
|
|
430,218
|
|
|
—
|
|
|||||
Investment gains
|
—
|
|
|
(3
|
)
|
|
(7,047
|
)
|
|
—
|
|
|
(7,050
|
)
|
|||||
Investment losses
|
—
|
|
|
78
|
|
|
1,402
|
|
|
—
|
|
|
1,480
|
|
|||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Restricted cash
|
(2
|
)
|
|
—
|
|
|
901
|
|
|
—
|
|
|
899
|
|
|||||
Tenant receivables
|
—
|
|
|
—
|
|
|
(1,519
|
)
|
|
—
|
|
|
(1,519
|
)
|
|||||
Deferred leasing costs
|
(37
|
)
|
|
—
|
|
|
(54,788
|
)
|
|
—
|
|
|
(54,825
|
)
|
|||||
Other assets
|
(5,606
|
)
|
|
—
|
|
|
(692
|
)
|
|
—
|
|
|
(6,298
|
)
|
|||||
Intercompany receivables and payables
|
3,021
|
|
|
—
|
|
|
(3,021
|
)
|
|
—
|
|
|
—
|
|
|||||
Accounts payable, accrued expenses, and tenant security deposits
|
(13,485
|
)
|
|
—
|
|
|
70,443
|
|
|
—
|
|
|
56,958
|
|
|||||
Net cash (used in) provided by operating activities
|
(69,656
|
)
|
|
1
|
|
|
382,382
|
|
|
—
|
|
|
312,727
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sale of real estate
|
10,796
|
|
|
—
|
|
|
143,172
|
|
|
—
|
|
|
153,968
|
|
|||||
Additions to real estate
|
—
|
|
|
—
|
|
|
(593,389
|
)
|
|
—
|
|
|
(593,389
|
)
|
|||||
Purchase of real estate
|
—
|
|
|
—
|
|
|
(122,069
|
)
|
|
—
|
|
|
(122,069
|
)
|
|||||
Change in restricted cash related to construction projects
|
—
|
|
|
—
|
|
|
7,655
|
|
|
—
|
|
|
7,655
|
|
|||||
Investment in unconsolidated joint venture
|
—
|
|
|
—
|
|
|
(17,987
|
)
|
|
—
|
|
|
(17,987
|
)
|
|||||
Investments in subsidiaries
|
(236,218
|
)
|
|
(276,022
|
)
|
|
(13,445
|
)
|
|
525,685
|
|
|
—
|
|
|||||
Additions to investments
|
—
|
|
|
—
|
|
|
(36,078
|
)
|
|
—
|
|
|
(36,078
|
)
|
|||||
Proceeds from sales of investments
|
—
|
|
|
1,018
|
|
|
15,507
|
|
|
—
|
|
|
16,525
|
|
|||||
Net cash used in investing activities
|
$
|
(225,422
|
)
|
|
$
|
(275,004
|
)
|
|
$
|
(616,634
|
)
|
|
$
|
525,685
|
|
|
$
|
(591,375
|
)
|
19.
|
Condensed consolidating financial information (continued)
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria Real
Estate Equities,
Inc. (Issuer)
|
|
Alexandria Real
Estate Equities,
L.P. (Guarantor
Subsidiary)
|
|
Combined
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
102,126
|
|
|
$
|
184,428
|
|
|
$
|
200,317
|
|
|
$
|
(381,343
|
)
|
|
$
|
105,528
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
6,490
|
|
|
—
|
|
|
185,515
|
|
|
—
|
|
|
192,005
|
|
|||||
Loss on early extinguishment of debt
|
2,225
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,225
|
|
|||||
Gain on sales of real estate – rental properties
|
—
|
|
|
—
|
|
|
(1,564
|
)
|
|
—
|
|
|
(1,564
|
)
|
|||||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
(1,864
|
)
|
|
—
|
|
|
(1,864
|
)
|
|||||
Impairment of real estate
|
6,400
|
|
|
—
|
|
|
7,050
|
|
|
—
|
|
|
13,450
|
|
|||||
Amortization of loan fees and costs
|
9,204
|
|
|
—
|
|
|
628
|
|
|
—
|
|
|
9,832
|
|
|||||
Amortization of debt premiums/discounts
|
114
|
|
|
—
|
|
|
397
|
|
|
—
|
|
|
511
|
|
|||||
Amortization of acquired above and below market leases
|
—
|
|
|
—
|
|
|
(3,200
|
)
|
|
—
|
|
|
(3,200
|
)
|
|||||
Deferred rent
|
(224
|
)
|
|
—
|
|
|
(28,232
|
)
|
|
—
|
|
|
(28,456
|
)
|
|||||
Equity in earnings of affiliates
|
(194,566
|
)
|
|
(183,139
|
)
|
|
(3,638
|
)
|
|
381,343
|
|
|
—
|
|
|||||
Stock compensation expense
|
14,160
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,160
|
|
|||||
Investment gains
|
—
|
|
|
(1,510
|
)
|
|
(13,508
|
)
|
|
—
|
|
|
(15,018
|
)
|
|||||
Investment losses
|
—
|
|
|
221
|
|
|
2,416
|
|
|
—
|
|
|
2,637
|
|
|||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Restricted cash
|
(12
|
)
|
|
—
|
|
|
(249
|
)
|
|
—
|
|
|
(261
|
)
|
|||||
Tenant receivables
|
11
|
|
|
—
|
|
|
(992
|
)
|
|
—
|
|
|
(981
|
)
|
|||||
Deferred leasing costs
|
(305
|
)
|
|
—
|
|
|
(44,794
|
)
|
|
—
|
|
|
(45,099
|
)
|
|||||
Other assets
|
1,329
|
|
|
—
|
|
|
(5,398
|
)
|
|
—
|
|
|
(4,069
|
)
|
|||||
Intercompany receivables and payables
|
(826
|
)
|
|
—
|
|
|
826
|
|
|
—
|
|
|
—
|
|
|||||
Accounts payable, accrued expenses, and tenant security deposits
|
6,172
|
|
|
—
|
|
|
59,525
|
|
|
—
|
|
|
65,697
|
|
|||||
Net cash (used in) provided by operating activities
|
(47,702
|
)
|
|
—
|
|
|
353,235
|
|
|
—
|
|
|
305,533
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sales of real estate
|
—
|
|
|
—
|
|
|
36,179
|
|
|
—
|
|
|
36,179
|
|
|||||
Additions to real estate
|
(1,313
|
)
|
|
—
|
|
|
(547,717
|
)
|
|
—
|
|
|
(549,030
|
)
|
|||||
Purchase of real estate
|
—
|
|
|
—
|
|
|
(42,171
|
)
|
|
—
|
|
|
(42,171
|
)
|
|||||
Change in restricted cash related to construction projects
|
—
|
|
|
—
|
|
|
(9,377
|
)
|
|
—
|
|
|
(9,377
|
)
|
|||||
Investment in unconsolidated joint venture
|
—
|
|
|
—
|
|
|
(6,700
|
)
|
|
—
|
|
|
(6,700
|
)
|
|||||
Distributions from unconsolidated joint venture
|
—
|
|
|
—
|
|
|
22,250
|
|
|
—
|
|
|
22,250
|
|
|||||
Investments in subsidiaries
|
(197,665
|
)
|
|
(158,022
|
)
|
|
(1,179
|
)
|
|
356,866
|
|
|
—
|
|
|||||
Additions to investments
|
—
|
|
|
(353
|
)
|
|
(35,941
|
)
|
|
—
|
|
|
(36,294
|
)
|
|||||
Proceeds from sales of investments
|
—
|
|
|
2,600
|
|
|
24,443
|
|
|
—
|
|
|
27,043
|
|
|||||
Net cash used in investing activities
|
$
|
(198,978
|
)
|
|
$
|
(155,775
|
)
|
|
$
|
(560,213
|
)
|
|
$
|
356,866
|
|
|
$
|
(558,100
|
)
|
19.
|
Condensed consolidating financial information (continued)
|
|
Alexandria Real
Estate Equities,
Inc. (Issuer)
|
|
Alexandria Real
Estate Equities,
L.P. (Guarantor
Subsidiary)
|
|
Combined
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Financing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings from secured notes payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,810
|
|
|
$
|
—
|
|
|
$
|
17,810
|
|
Repayments of borrowings from secured notes payable
|
—
|
|
|
—
|
|
|
(26,367
|
)
|
|
—
|
|
|
(26,367
|
)
|
|||||
Proceeds from issuance of unsecured senior notes payable
|
544,650
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
544,650
|
|
|||||
Principal borrowings from unsecured senior line of credit
|
847,147
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
847,147
|
|
|||||
Repayments of borrowings from unsecured senior line of credit
|
(651,147
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(651,147
|
)
|
|||||
Repayments of unsecured senior bank term loan
|
(250,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(250,000
|
)
|
|||||
Repurchase of unsecured senior convertible notes
|
(84,801
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(84,801
|
)
|
|||||
Redemption of Series C Cumulative Redeemable Preferred Stock
|
(129,638
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(129,638
|
)
|
|||||
Proceeds from issuance of Series E Cumulative Redeemable Preferred Stock
|
124,868
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
124,868
|
|
|||||
Transfer to/from parent company
|
—
|
|
|
157,689
|
|
|
199,177
|
|
|
(356,866
|
)
|
|
—
|
|
|||||
Change in restricted cash related to financing activities
|
—
|
|
|
—
|
|
|
(7,428
|
)
|
|
—
|
|
|
(7,428
|
)
|
|||||
Loan fees and costs paid
|
(10,180
|
)
|
|
—
|
|
|
(3,045
|
)
|
|
—
|
|
|
(13,225
|
)
|
|||||
Proceeds from common stock offerings
|
97,890
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
97,890
|
|
|||||
Proceeds from exercise of stock options
|
155
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
155
|
|
|||||
Dividends paid on common stock
|
(126,498
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(126,498
|
)
|
|||||
Dividends paid on preferred stock
|
(27,819
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,819
|
)
|
|||||
Distributions to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
(1,249
|
)
|
|
—
|
|
|
(1,249
|
)
|
|||||
Redemption of redeemable noncontrolling interests
|
12
|
|
|
—
|
|
|
(462
|
)
|
|
—
|
|
|
(450
|
)
|
|||||
Contributions by noncontrolling interests
|
—
|
|
|
—
|
|
|
1,875
|
|
|
—
|
|
|
1,875
|
|
|||||
Distributions to noncontrolling interests
|
—
|
|
|
—
|
|
|
(913
|
)
|
|
—
|
|
|
(913
|
)
|
|||||
Net cash provided by financing activities
|
334,639
|
|
|
157,689
|
|
|
179,398
|
|
|
(356,866
|
)
|
|
314,860
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
—
|
|
|
—
|
|
|
139
|
|
|
—
|
|
|
139
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net increase (decrease) in cash and cash equivalents
|
87,959
|
|
|
1,914
|
|
|
(27,441
|
)
|
|
—
|
|
|
$
|
62,432
|
|
||||
Cash and cash equivalents at beginning of period
|
10,608
|
|
|
—
|
|
|
67,931
|
|
|
—
|
|
|
$
|
78,539
|
|
||||
Cash and cash equivalents at end of period
|
$
|
98,567
|
|
|
$
|
1,914
|
|
|
$
|
40,490
|
|
|
$
|
—
|
|
|
$
|
140,971
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Supplemental Disclosure of Cash Flow Information
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash paid during the period for interest, net of interest capitalized
|
$
|
39,298
|
|
|
$
|
—
|
|
|
$
|
13,263
|
|
|
$
|
—
|
|
|
$
|
52,561
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Non-Cash Investing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Note receivable from sale of real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,125
|
|
|
$
|
—
|
|
|
$
|
6,125
|
|
Write-off of fully amortized improvements
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(17,730
|
)
|
|
$
|
—
|
|
|
$
|
(17,730
|
)
|
Change in accrued construction
|
$
|
(2,000
|
)
|
|
$
|
—
|
|
|
$
|
48,087
|
|
|
$
|
—
|
|
|
$
|
46,087
|
|
|
|
|
|
|
|
Initial Costs
|
|
Costs Capitalized Subsequent to Acquisitions
|
|
Total Costs
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Property
|
|
Market
|
|
Encumbrances
|
|
Land
|
|
Buildings & Improvements
|
|
Buildings & Improvements
|
|
Land
|
|
Buildings & Improvements
|
|
Total
(1)
|
|
Accumulated Depreciation
(2)
|
|
Net Cost Basis
|
|
Date of Construction
(3)
|
|
Date
Acquired
|
||||||||||||||||||
Alexandria Center
®
at Kendall Square
|
|
Greater Boston
|
|
$
|
106,093
|
|
|
$
|
280,713
|
|
|
$
|
199,583
|
|
|
$
|
662,031
|
|
|
$
|
280,713
|
|
|
$
|
861,614
|
|
|
$
|
1,142,327
|
|
|
$
|
(44,490
|
)
|
|
$
|
1,097,837
|
|
|
2000-2013
|
|
2005-2013
|
Alexandria Technology Square
®
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
619,658
|
|
|
186,472
|
|
|
—
|
|
|
806,130
|
|
|
806,130
|
|
|
(141,360
|
)
|
|
664,770
|
|
|
2001-2012
|
|
2006
|
|||||||||
480 Arsenal Street
|
|
Greater Boston
|
|
—
|
|
|
6,413
|
|
|
5,457
|
|
|
46,115
|
|
|
6,413
|
|
|
51,572
|
|
|
57,985
|
|
|
(14,358
|
)
|
|
43,627
|
|
|
2003
|
|
2001
|
|||||||||
780/790 Memorial Drive
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45,140
|
|
|
—
|
|
|
45,140
|
|
|
45,140
|
|
|
(17,895
|
)
|
|
27,245
|
|
|
2002
|
|
2001
|
|||||||||
500 Arsenal Street
|
|
Greater Boston
|
|
—
|
|
|
3,360
|
|
|
7,316
|
|
|
29,136
|
|
|
3,360
|
|
|
36,452
|
|
|
39,812
|
|
|
(13,368
|
)
|
|
26,444
|
|
|
2001
|
|
2000
|
|||||||||
167 Sidney Street/99 Erie Street
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
12,613
|
|
|
12,273
|
|
|
—
|
|
|
24,886
|
|
|
24,886
|
|
|
(4,064
|
)
|
|
20,822
|
|
|
2006/2012
|
|
2005/2006
|
|||||||||
79/96 Thirteenth Street Charlestown Navy Yard
|
|
Greater Boston
|
|
4,556
|
|
(4)
|
—
|
|
|
6,247
|
|
|
8,661
|
|
|
—
|
|
|
14,908
|
|
|
14,908
|
|
|
(2,785
|
)
|
|
12,123
|
|
|
2012
|
|
1998
|
|||||||||
Alexandria Park at 128
|
|
Greater Boston
|
|
23,301
|
|
(4) (5)
|
10,439
|
|
|
41,596
|
|
|
56,059
|
|
|
10,439
|
|
|
97,655
|
|
|
108,094
|
|
|
(27,003
|
)
|
|
81,091
|
|
|
1997-2010
|
|
1998-2008
|
|||||||||
225 Second Avenue
|
|
Greater Boston
|
|
—
|
|
|
2,925
|
|
|
14,913
|
|
|
17,047
|
|
|
2,925
|
|
|
31,960
|
|
|
34,885
|
|
|
—
|
|
|
34,885
|
|
|
2014
|
|
2014
|
|||||||||
19 Presidential Way
|
|
Greater Boston
|
|
—
|
|
|
12,833
|
|
|
27,333
|
|
|
66
|
|
|
12,833
|
|
|
27,399
|
|
|
40,232
|
|
|
(6,621
|
)
|
|
33,611
|
|
|
1999
|
|
2005
|
|||||||||
100 Beaver Street
|
|
Greater Boston
|
|
—
|
|
|
1,466
|
|
|
9,046
|
|
|
11,742
|
|
|
1,466
|
|
|
20,788
|
|
|
22,254
|
|
|
(4,169
|
)
|
|
18,085
|
|
|
2006
|
|
2005
|
|||||||||
285 Bear Hill Road
|
|
Greater Boston
|
|
—
|
|
|
422
|
|
|
3,538
|
|
|
5,189
|
|
|
422
|
|
|
8,727
|
|
|
9,149
|
|
|
(340
|
)
|
|
8,809
|
|
|
2013
|
|
2011
|
|||||||||
111/130 Forbes Boulevard
|
|
Greater Boston
|
|
—
|
|
|
3,146
|
|
|
15,725
|
|
|
2,936
|
|
|
3,146
|
|
|
18,661
|
|
|
21,807
|
|
|
(3,940
|
)
|
|
17,867
|
|
|
2006
|
|
2007/2006
|
|||||||||
20 Walkup Drive
|
|
Greater Boston
|
|
—
|
|
|
2,261
|
|
|
7,099
|
|
|
9,029
|
|
|
2,261
|
|
|
16,128
|
|
|
18,389
|
|
|
(1,639
|
)
|
|
16,750
|
|
|
2012
|
|
2006
|
|||||||||
306 Belmont Street & 350 Plantation Street
|
|
Greater Boston
|
|
—
|
|
|
1,806
|
|
|
11,696
|
|
|
1,783
|
|
|
1,806
|
|
|
13,479
|
|
|
15,285
|
|
|
(3,594
|
)
|
|
11,691
|
|
|
2003
|
|
2004
|
|||||||||
30 Bearfoot Road
|
|
Greater Boston
|
|
—
|
|
|
1,220
|
|
|
22,375
|
|
|
44
|
|
|
1,220
|
|
|
22,419
|
|
|
23,639
|
|
|
(5,512
|
)
|
|
18,127
|
|
|
2000
|
|
2005
|
|||||||||
Alexandria Center
®
for Science & Technology
|
|
San Francisco Bay Area
|
|
—
|
|
|
93,813
|
|
|
210,211
|
|
|
370,840
|
|
|
93,813
|
|
|
581,051
|
|
|
674,864
|
|
|
(53,840
|
)
|
|
621,024
|
|
|
2007-2011
|
|
2004-2011
|
|||||||||
Alexandria Technology Center – Gateway
|
|
San Francisco Bay Area
|
|
98,133
|
|
(6)
|
45,425
|
|
|
121,059
|
|
|
15,378
|
|
|
45,425
|
|
|
136,437
|
|
|
181,862
|
|
|
(35,125
|
)
|
|
146,737
|
|
|
2000-2006
|
|
2002-2006
|
|||||||||
249/259/269 East Grand Avenue
|
|
San Francisco Bay Area
|
|
66,135
|
|
|
19,396
|
|
|
—
|
|
|
151,275
|
|
|
19,396
|
|
|
151,275
|
|
|
170,671
|
|
|
(14,070
|
)
|
|
156,601
|
|
|
2008/2012/2014
|
|
2004
|
|||||||||
400/450 East Jamie Court
|
|
San Francisco Bay Area
|
|
—
|
|
|
—
|
|
|
—
|
|
|
109,622
|
|
|
—
|
|
|
109,622
|
|
|
109,622
|
|
|
(15,612
|
)
|
|
94,010
|
|
|
2012
|
|
2002
|
|||||||||
500 Forbes Boulevard
|
|
San Francisco Bay Area
|
|
—
|
|
|
35,596
|
|
|
69,091
|
|
|
14,441
|
|
|
35,596
|
|
|
83,532
|
|
|
119,128
|
|
|
(16,450
|
)
|
|
102,678
|
|
|
2001
|
|
2007
|
|||||||||
7000 Shoreline Court
|
|
San Francisco Bay Area
|
|
31,234
|
|
(6)
|
7,038
|
|
|
39,704
|
|
|
9,070
|
|
|
7,038
|
|
|
48,774
|
|
|
55,812
|
|
|
(11,684
|
)
|
|
44,128
|
|
|
2001
|
|
2004
|
|||||||||
341/343 Oyster Point Boulevard
|
|
San Francisco Bay Area
|
|
—
|
|
|
7,038
|
|
|
—
|
|
|
31,968
|
|
|
7,038
|
|
|
31,968
|
|
|
39,006
|
|
|
(13,517
|
)
|
|
25,489
|
|
|
2009/2013
|
|
2000
|
|||||||||
849/863 Mitten Road & 866 Malcolm Road
|
|
San Francisco Bay Area
|
|
—
|
|
|
3,211
|
|
|
8,665
|
|
|
15,307
|
|
|
3,211
|
|
|
23,972
|
|
|
27,183
|
|
|
(8,139
|
)
|
|
19,044
|
|
|
2012
|
|
1998
|
|||||||||
2425 Garcia Avenue & 2400/2450 Bayshore Parkway
|
|
San Francisco Bay Area
|
|
830
|
|
|
1,512
|
|
|
21,323
|
|
|
25,150
|
|
|
1,512
|
|
|
46,473
|
|
|
47,985
|
|
|
(16,339
|
)
|
|
31,646
|
|
|
2008
|
|
1999
|
|||||||||
3165 Porter Drive
|
|
San Francisco Bay Area
|
|
20,421
|
|
(5)
|
—
|
|
|
19,154
|
|
|
2,105
|
|
|
—
|
|
|
21,259
|
|
|
21,259
|
|
|
(5,686
|
)
|
|
15,573
|
|
|
2002
|
|
2003
|
|||||||||
75/125 Shoreway Road
|
|
San Francisco Bay Area
|
|
—
|
|
|
6,617
|
|
|
7,091
|
|
|
10,852
|
|
|
6,617
|
|
|
17,943
|
|
|
24,560
|
|
|
(3,069
|
)
|
|
21,491
|
|
|
2008
|
|
2006
|
|||||||||
3350 West Bayshore Road
|
|
San Francisco Bay Area
|
|
—
|
|
|
4,800
|
|
|
6,693
|
|
|
10,940
|
|
|
4,800
|
|
|
17,633
|
|
|
22,433
|
|
|
(3,486
|
)
|
|
18,947
|
|
|
1982
|
|
2005
|
|
|
|
|
|
|
Initial Costs
|
|
Costs Capitalized Subsequent to Acquisitions
|
|
Total Costs
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Property
|
|
Market
|
|
Encumbrances
|
|
Land
|
|
Buildings & Improvements
|
|
Buildings & Improvements
|
|
Land
|
|
Buildings & Improvements
|
|
Total
(1)
|
|
Accumulated Depreciation
(2)
|
|
Net Cost Basis
|
|
Date of Construction
(3)
|
|
Date
Acquired
|
||||||||||||||||||
2625/2627/2631 Hanover Street
|
|
San Francisco Bay Area
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,628
|
|
|
$
|
10,488
|
|
|
$
|
—
|
|
|
$
|
17,116
|
|
|
$
|
17,116
|
|
|
$
|
(7,440
|
)
|
|
$
|
9,676
|
|
|
2000
|
|
1999
|
510 Townsend Street
|
|
San Francisco Bay Area
|
|
—
|
|
|
52,105
|
|
|
—
|
|
|
6,354
|
|
|
52,105
|
|
|
6,354
|
|
|
58,459
|
|
|
—
|
|
|
58,459
|
|
|
N/A
|
|
2014
|
|||||||||
560 Eccles Avenue
|
|
San Francisco Bay Area
|
|
—
|
|
|
12,093
|
|
|
—
|
|
|
5,562
|
|
|
12,093
|
|
|
5,562
|
|
|
17,655
|
|
|
(3
|
)
|
|
17,652
|
|
|
N/A
|
|
2006
|
|||||||||
Grand Avenue
|
|
San Francisco Bay Area
|
|
—
|
|
|
37,538
|
|
|
—
|
|
|
7,518
|
|
|
37,538
|
|
|
7,518
|
|
|
45,056
|
|
|
(21
|
)
|
|
45,035
|
|
|
N/A
|
|
2004/2005/2008
|
|||||||||
Alexandria Center
®
for Life Science
|
|
New York City
|
|
—
|
|
|
—
|
|
|
—
|
|
|
778,293
|
|
|
—
|
|
|
778,293
|
|
|
778,293
|
|
|
(47,615
|
)
|
|
730,678
|
|
|
2010-2013
|
|
2006
|
|||||||||
100 Phillips Parkway
|
|
New York City
|
|
9,353
|
|
(4)
|
1,840
|
|
|
2,298
|
|
|
14,897
|
|
|
1,840
|
|
|
17,195
|
|
|
19,035
|
|
|
(7,917
|
)
|
|
11,118
|
|
|
1999
|
|
1998
|
|||||||||
102 Witmer Road
|
|
New York City
|
|
—
|
|
|
1,625
|
|
|
19,715
|
|
|
5,641
|
|
|
1,625
|
|
|
25,356
|
|
|
26,981
|
|
|
(6,279
|
)
|
|
20,702
|
|
|
2002
|
|
2006
|
|||||||||
701 Veterans Circle
|
|
New York City
|
|
—
|
|
|
1,468
|
|
|
7,885
|
|
|
26
|
|
|
1,468
|
|
|
7,911
|
|
|
9,379
|
|
|
(1,485
|
)
|
|
7,894
|
|
|
2007
|
|
2007
|
|||||||||
5100 Campus Drive
|
|
New York City
|
|
—
|
|
|
256
|
|
|
2,117
|
|
|
469
|
|
|
256
|
|
|
2,586
|
|
|
2,842
|
|
|
(1,254
|
)
|
|
1,588
|
|
|
1989
|
|
1998
|
|||||||||
ARE Nautilus
|
|
San Diego
|
|
—
|
|
|
6,684
|
|
|
27,600
|
|
|
83,309
|
|
|
6,684
|
|
|
110,909
|
|
|
117,593
|
|
|
(24,872
|
)
|
|
92,721
|
|
|
2010-2012
|
|
1994-1997
|
|||||||||
ARE Sunrise
|
|
San Diego
|
|
19,590
|
|
(7)
|
2,954
|
|
|
15,491
|
|
|
41,518
|
|
|
2,954
|
|
|
57,009
|
|
|
59,963
|
|
|
(29,960
|
)
|
|
30,003
|
|
|
2000-2009
|
|
1994-2000
|
|||||||||
ARE Spectrum
|
|
San Diego
|
|
—
|
|
|
27,388
|
|
|
80,957
|
|
|
46,944
|
|
|
27,388
|
|
|
127,901
|
|
|
155,289
|
|
|
(15,905
|
)
|
|
139,384
|
|
|
2008
|
|
2007
|
|||||||||
11119 North Torrey Pines Road
|
|
San Diego
|
|
—
|
|
|
9,994
|
|
|
37,099
|
|
|
32,505
|
|
|
9,994
|
|
|
69,604
|
|
|
79,598
|
|
|
(6,188
|
)
|
|
73,410
|
|
|
2012
|
|
2007
|
|||||||||
3545 Cray Court
|
|
San Diego
|
|
39,387
|
|
|
7,056
|
|
|
53,944
|
|
|
—
|
|
|
7,056
|
|
|
53,944
|
|
|
61,000
|
|
|
(4,864
|
)
|
|
56,136
|
|
|
1998
|
|
2014
|
|||||||||
5200 Illumina Way
|
|
San Diego
|
|
—
|
|
|
38,340
|
|
|
96,606
|
|
|
73,541
|
|
|
38,340
|
|
|
170,147
|
|
|
208,487
|
|
|
(15,176
|
)
|
|
193,311
|
|
|
2004-2014
|
|
2010
|
|||||||||
10300 Campus Point Drive
|
|
San Diego
|
|
—
|
|
|
22,487
|
|
|
90,198
|
|
|
102,464
|
|
|
22,487
|
|
|
192,662
|
|
|
215,149
|
|
|
(12,655
|
)
|
|
202,494
|
|
|
2012
|
|
2010
|
|||||||||
ARE Esplanade
|
|
San Diego
|
|
11,452
|
|
(7)
|
9,682
|
|
|
29,991
|
|
|
45,439
|
|
|
9,682
|
|
|
75,430
|
|
|
85,112
|
|
|
(9,459
|
)
|
|
75,653
|
|
|
1989-2013
|
|
1998-2011
|
|||||||||
ARE Towne Centre
|
|
San Diego
|
|
34,110
|
|
(5)
|
8,539
|
|
|
18,850
|
|
|
40,293
|
|
|
8,539
|
|
|
59,143
|
|
|
67,682
|
|
|
(31,899
|
)
|
|
35,783
|
|
|
2000-2010
|
|
1999
|
|||||||||
9880 Campus Point Drive
|
|
San Diego
|
|
—
|
|
|
3,823
|
|
|
16,165
|
|
|
20,053
|
|
|
3,823
|
|
|
36,218
|
|
|
40,041
|
|
|
(8,915
|
)
|
|
31,126
|
|
|
2005
|
|
2001
|
|||||||||
5810/5820/6138/6150 Nancy Ridge Drive
|
|
San Diego
|
|
11,435
|
|
(5)
|
5,476
|
|
|
28,682
|
|
|
1,811
|
|
|
5,476
|
|
|
30,493
|
|
|
35,969
|
|
|
(7,743
|
)
|
|
28,226
|
|
|
2000-2001
|
|
2003-2004
|
|||||||||
ARE Portola
|
|
San Diego
|
|
—
|
|
|
6,991
|
|
|
25,153
|
|
|
17,734
|
|
|
6,991
|
|
|
42,887
|
|
|
49,878
|
|
|
(4,905
|
)
|
|
44,973
|
|
|
2005-2012
|
|
2007
|
|||||||||
10121/10151 Barnes Canyon Road
|
|
San Diego
|
|
—
|
|
|
4,608
|
|
|
5,100
|
|
|
14,257
|
|
|
4,608
|
|
|
19,357
|
|
|
23,965
|
|
|
(188
|
)
|
|
23,777
|
|
|
1988
|
|
2013
|
|||||||||
7330 Carroll Road
|
|
San Diego
|
|
4,517
|
|
(4)
|
2,650
|
|
|
19,878
|
|
|
1,253
|
|
|
2,650
|
|
|
21,131
|
|
|
23,781
|
|
|
(2,347
|
)
|
|
21,434
|
|
|
2007
|
|
2010
|
|||||||||
5871 Oberlin Drive
|
|
San Diego
|
|
—
|
|
|
1,349
|
|
|
8,016
|
|
|
3,623
|
|
|
1,349
|
|
|
11,639
|
|
|
12,988
|
|
|
(949
|
)
|
|
12,039
|
|
|
2004
|
|
2010
|
|||||||||
6146 Nancy Ridge Road
|
|
San Diego
|
|
—
|
|
|
515
|
|
|
1,566
|
|
|
2,844
|
|
|
515
|
|
|
4,410
|
|
|
4,925
|
|
|
(2,183
|
)
|
|
2,742
|
|
|
2001
|
|
2000
|
|||||||||
11025/11035/11045/11055/11065/
11075 Roselle Street
|
|
San Diego
|
|
—
|
|
|
4,156
|
|
|
11,571
|
|
|
22,161
|
|
|
4,156
|
|
|
33,732
|
|
|
37,888
|
|
|
(5,828
|
)
|
|
32,060
|
|
|
2006/2008/2014
|
|
1997/2000/2014
|
|||||||||
3985/4025/4031/4045 Sorrento Valley Boulevard
|
|
San Diego
|
|
7,333
|
|
(8)
|
4,323
|
|
|
22,846
|
|
|
3,568
|
|
|
4,323
|
|
|
26,414
|
|
|
30,737
|
|
|
(2,651
|
)
|
|
28,086
|
|
|
2007
|
|
2010/2014
|
|||||||||
13112 Evening Creek Drive
|
|
San Diego
|
|
12,398
|
|
(7)
|
7,393
|
|
|
27,950
|
|
|
150
|
|
|
7,393
|
|
|
28,100
|
|
|
35,493
|
|
|
(5,504
|
)
|
|
29,989
|
|
|
2007
|
|
2007
|
|||||||||
1201/1208 Eastlake Avenue East
|
|
Seattle
|
|
41,830
|
|
(7)
|
5,810
|
|
|
47,149
|
|
|
14,955
|
|
|
5,810
|
|
|
62,104
|
|
|
67,914
|
|
|
(18,941
|
)
|
|
48,973
|
|
|
1997
|
|
2002
|
|||||||||
1616 Eastlake Avenue East
|
|
Seattle
|
|
—
|
|
|
6,940
|
|
|
—
|
|
|
82,526
|
|
|
6,940
|
|
|
82,526
|
|
|
89,466
|
|
|
(17,874
|
)
|
|
71,592
|
|
|
2013
|
|
2003
|
|||||||||
1551 Eastlake Avenue East
|
|
Seattle
|
|
—
|
|
|
8,525
|
|
|
20,064
|
|
|
32,893
|
|
|
8,525
|
|
|
52,957
|
|
|
61,482
|
|
|
(6,055
|
)
|
|
55,427
|
|
|
2012
|
|
2004
|
|||||||||
199 East Blaine Street
|
|
Seattle
|
|
—
|
|
|
6,528
|
|
|
—
|
|
|
71,707
|
|
|
6,528
|
|
|
71,707
|
|
|
78,235
|
|
|
(9,980
|
)
|
|
68,255
|
|
|
2010
|
|
2004
|
|||||||||
219 Terry Avenue North
|
|
Seattle
|
|
—
|
|
|
1,819
|
|
|
2,302
|
|
|
18,943
|
|
|
1,819
|
|
|
21,245
|
|
|
23,064
|
|
|
(1,705
|
)
|
|
21,359
|
|
|
2012
|
|
2007
|
|||||||||
1600 Fairview Avenue East
|
|
Seattle
|
|
—
|
|
|
2,212
|
|
|
6,788
|
|
|
6,009
|
|
|
2,212
|
|
|
12,797
|
|
|
15,009
|
|
|
(2,611
|
)
|
|
12,398
|
|
|
2007
|
|
2005
|
|||||||||
3000/3018 Western Avenue
|
|
Seattle
|
|
—
|
|
|
1,432
|
|
|
7,497
|
|
|
21,590
|
|
|
1,432
|
|
|
29,087
|
|
|
30,519
|
|
|
(7,528
|
)
|
|
22,991
|
|
|
2000
|
|
1998
|
|
|
|
|
|
|
Initial Costs
|
|
Costs Capitalized Subsequent to Acquisitions
|
|
Total Costs
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Property
|
|
Market
|
|
Encumbrances
|
|
Land
|
|
Buildings & Improvements
|
|
Buildings & Improvements
|
|
Land
|
|
Buildings & Improvements
|
|
Total
(1)
|
|
Accumulated Depreciation
(2)
|
|
Net Cost Basis
|
|
Date of Construction
(3)
|
|
Date
Acquired
|
||||||||||||||||||
410 West Harrison/410 Elliott Avenue West
|
|
Seattle
|
|
$
|
—
|
|
|
$
|
3,857
|
|
|
$
|
1,989
|
|
|
$
|
10,549
|
|
|
$
|
3,857
|
|
|
$
|
12,538
|
|
|
$
|
16,395
|
|
|
$
|
(2,604
|
)
|
|
$
|
13,791
|
|
|
2008/2006
|
|
2004
|
9800 Medical Center Drive
|
|
Maryland
|
|
76,000
|
|
|
10,052
|
|
|
99,696
|
|
|
96,305
|
|
|
10,052
|
|
|
196,001
|
|
|
206,053
|
|
|
(40,359
|
)
|
|
165,694
|
|
|
2010-2013
|
|
2004
|
|||||||||
1330 Piccard Drive
|
|
Maryland
|
|
—
|
|
|
2,800
|
|
|
11,533
|
|
|
28,928
|
|
|
2,800
|
|
|
40,461
|
|
|
43,261
|
|
|
(12,517
|
)
|
|
30,744
|
|
|
2005
|
|
1997
|
|||||||||
1500/1550 East Gude Drive
|
|
Maryland
|
|
—
|
|
|
1,523
|
|
|
7,731
|
|
|
5,511
|
|
|
1,523
|
|
|
13,242
|
|
|
14,765
|
|
|
(4,919
|
)
|
|
9,846
|
|
|
2003/1995
|
|
1997
|
|||||||||
14920/15010 Broschart Road
|
|
Maryland
|
|
5,804
|
|
(9)
|
4,904
|
|
|
15,846
|
|
|
3,823
|
|
|
4,904
|
|
|
19,669
|
|
|
24,573
|
|
|
(3,152
|
)
|
|
21,421
|
|
|
1998/1999
|
|
2010/2004
|
|||||||||
1405 Research Boulevard
|
|
Maryland
|
|
—
|
|
|
899
|
|
|
21,946
|
|
|
11,515
|
|
|
899
|
|
|
33,461
|
|
|
34,360
|
|
|
(10,165
|
)
|
|
24,195
|
|
|
2006
|
|
1997
|
|||||||||
5 Research Place
|
|
Maryland
|
|
—
|
|
|
1,466
|
|
|
5,708
|
|
|
27,007
|
|
|
1,466
|
|
|
32,715
|
|
|
34,181
|
|
|
(6,427
|
)
|
|
27,754
|
|
|
2010
|
|
2001
|
|||||||||
9920 Medical Center Drive
|
|
Maryland
|
|
—
|
|
|
5,791
|
|
|
8,060
|
|
|
1,071
|
|
|
5,791
|
|
|
9,131
|
|
|
14,922
|
|
|
(2,141
|
)
|
|
12,781
|
|
|
2002
|
|
2004
|
|||||||||
5 Research Court
|
|
Maryland
|
|
—
|
|
|
1,647
|
|
|
13,258
|
|
|
5,199
|
|
|
1,647
|
|
|
18,457
|
|
|
20,104
|
|
|
(13,489
|
)
|
|
6,615
|
|
|
2007
|
|
2004
|
|||||||||
12301 Parklawn Drive
|
|
Maryland
|
|
—
|
|
|
1,476
|
|
|
7,267
|
|
|
561
|
|
|
1,476
|
|
|
7,828
|
|
|
9,304
|
|
|
(1,912
|
)
|
|
7,392
|
|
|
2007
|
|
2004
|
|||||||||
Alexandria Technology Center – Gaithersburg I
|
|
Maryland
|
|
—
|
|
|
10,183
|
|
|
59,641
|
|
|
21,652
|
|
|
10,183
|
|
|
81,293
|
|
|
91,476
|
|
|
(22,561
|
)
|
|
68,915
|
|
|
1992-2009
|
|
1997-2004
|
|||||||||
Alexandria Technology Center – Gaithersburg II
|
|
Maryland
|
|
—
|
|
|
4,531
|
|
|
21,594
|
|
|
31,651
|
|
|
4,531
|
|
|
53,245
|
|
|
57,776
|
|
|
(21,028
|
)
|
|
36,748
|
|
|
2000-2003
|
|
1997-2000
|
|||||||||
16020 Industrial Drive
|
|
Maryland
|
|
—
|
|
|
2,924
|
|
|
19,664
|
|
|
714
|
|
|
2,924
|
|
|
20,378
|
|
|
23,302
|
|
|
(9,349
|
)
|
|
13,953
|
|
|
1983
|
|
2005
|
|||||||||
401 Professional Drive
|
|
Maryland
|
|
—
|
|
|
1,129
|
|
|
6,941
|
|
|
5,745
|
|
|
1,129
|
|
|
12,686
|
|
|
13,815
|
|
|
(4,603
|
)
|
|
9,212
|
|
|
2007
|
|
1996
|
|||||||||
950 Wind River Lane
|
|
Maryland
|
|
—
|
|
|
2,400
|
|
|
10,620
|
|
|
1,050
|
|
|
2,400
|
|
|
11,670
|
|
|
14,070
|
|
|
(1,557
|
)
|
|
12,513
|
|
|
2009
|
|
2010
|
|||||||||
620 Professional Drive
|
|
Maryland
|
|
—
|
|
|
784
|
|
|
4,705
|
|
|
7,216
|
|
|
784
|
|
|
11,921
|
|
|
12,705
|
|
|
(1,320
|
)
|
|
11,385
|
|
|
2012
|
|
2005
|
|||||||||
8000/9000/10000 Virginia Manor Road
|
|
Maryland
|
|
—
|
|
|
—
|
|
|
13,679
|
|
|
5,847
|
|
|
—
|
|
|
19,526
|
|
|
19,526
|
|
|
(7,765
|
)
|
|
11,761
|
|
|
2003
|
|
1998
|
|||||||||
14225 Newbrook Drive
|
|
Maryland
|
|
28,297
|
|
(7)
|
4,800
|
|
|
27,639
|
|
|
6,863
|
|
|
4,800
|
|
|
34,502
|
|
|
39,302
|
|
|
(12,542
|
)
|
|
26,760
|
|
|
2006
|
|
1997
|
|||||||||
Alexandria Technology Center – Alston
|
|
Research Triangle Park
|
|
—
|
|
|
1,430
|
|
|
17,482
|
|
|
27,781
|
|
|
1,430
|
|
|
45,263
|
|
|
46,693
|
|
|
(17,701
|
)
|
|
28,992
|
|
|
1985-2009
|
|
1998
|
|||||||||
108/110/112/114 TW Alexander Drive
|
|
Research Triangle Park
|
|
—
|
|
|
—
|
|
|
376
|
|
|
42,050
|
|
|
—
|
|
|
42,426
|
|
|
42,426
|
|
|
(11,837
|
)
|
|
30,589
|
|
|
2000
|
|
1999
|
|||||||||
Alexandria Innovation Center – Research Triangle Park
|
|
Research Triangle Park
|
|
—
|
|
|
1,065
|
|
|
21,218
|
|
|
24,461
|
|
|
1,065
|
|
|
45,679
|
|
|
46,744
|
|
|
(11,144
|
)
|
|
35,600
|
|
|
2005-2008
|
|
2000
|
|||||||||
6 Davis Drive
|
|
Research Triangle Park
|
|
—
|
|
|
9,920
|
|
|
10,712
|
|
|
7,573
|
|
|
9,920
|
|
|
18,285
|
|
|
28,205
|
|
|
(3,623
|
)
|
|
24,582
|
|
|
2012
|
|
2012
|
|||||||||
7 Triangle Drive
|
|
Research Triangle Park
|
|
—
|
|
|
701
|
|
|
—
|
|
|
31,643
|
|
|
701
|
|
|
31,643
|
|
|
32,344
|
|
|
(2,914
|
)
|
|
29,430
|
|
|
2011
|
|
2005
|
|||||||||
407 Davis Drive
|
|
Research Triangle Park
|
|
—
|
|
|
1,229
|
|
|
17,733
|
|
|
—
|
|
|
1,229
|
|
|
17,733
|
|
|
18,962
|
|
|
(683
|
)
|
|
18,279
|
|
|
1998
|
|
2013
|
|||||||||
2525 East NC Highway 54
|
|
Research Triangle Park
|
|
—
|
|
|
713
|
|
|
12,827
|
|
|
894
|
|
|
713
|
|
|
13,721
|
|
|
14,434
|
|
|
(3,685
|
)
|
|
10,749
|
|
|
1995
|
|
2004
|
|||||||||
601 Keystone Park Drive
|
|
Research Triangle Park
|
|
—
|
|
|
785
|
|
|
11,546
|
|
|
5,017
|
|
|
785
|
|
|
16,563
|
|
|
17,348
|
|
|
(3,140
|
)
|
|
14,208
|
|
|
2009
|
|
2006
|
|||||||||
5 Triangle Drive
|
|
Research Triangle Park
|
|
—
|
|
|
161
|
|
|
3,409
|
|
|
2,857
|
|
|
161
|
|
|
6,266
|
|
|
6,427
|
|
|
(2,074
|
)
|
|
4,353
|
|
|
1981
|
|
1998
|
|||||||||
6101 Quadrangle Drive
|
|
Research Triangle Park
|
|
—
|
|
|
951
|
|
|
3,982
|
|
|
9,462
|
|
|
951
|
|
|
13,444
|
|
|
14,395
|
|
|
(1,221
|
)
|
|
13,174
|
|
|
2012
|
|
2008
|
|||||||||
555 Heritage Drive
|
|
Research Triangle Park
|
|
—
|
|
|
2,919
|
|
|
5,311
|
|
|
11,959
|
|
|
2,919
|
|
|
17,270
|
|
|
20,189
|
|
|
(2,461
|
)
|
|
17,728
|
|
|
2010
|
|
2006
|
|
|
|
|
|
|
Initial Costs
|
|
Costs Capitalized Subsequent to Acquisitions
|
|
Total Costs
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Property
|
|
Market
|
|
Encumbrances
|
|
Land
|
|
Buildings & Improvements
|
|
Buildings & Improvements
|
|
Land
|
|
Buildings & Improvements
|
|
Total
(1)
|
|
Accumulated Depreciation
(2)
|
|
Net Cost Basis
|
|
Date of Construction
(3)
|
|
Date
Acquired
|
||||||||||||||||||
661 University Ave
(10)
|
|
Canada
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
63,511
|
|
|
$
|
—
|
|
|
$
|
63,511
|
|
|
$
|
63,511
|
|
|
$
|
(12,016
|
)
|
|
$
|
51,495
|
|
|
2008
|
|
2007
|
1781 W. 75th Avenue
|
|
Canada
|
|
—
|
|
|
2,059
|
|
|
4,244
|
|
|
8,482
|
|
|
2,059
|
|
|
12,726
|
|
|
14,785
|
|
|
(2,235
|
)
|
|
12,550
|
|
|
2008
|
|
2007
|
|||||||||
7990 Enterprise Street
|
|
Canada
|
|
—
|
|
|
2,277
|
|
|
8,864
|
|
|
—
|
|
|
2,277
|
|
|
8,864
|
|
|
11,141
|
|
|
(1,979
|
)
|
|
9,162
|
|
|
2003
|
|
2005
|
|||||||||
245/275 Armand Frappier
|
|
Canada
|
|
—
|
|
|
6,986
|
|
|
23,043
|
|
|
6,477
|
|
|
6,986
|
|
|
29,520
|
|
|
36,506
|
|
|
(5,529
|
)
|
|
30,977
|
|
|
2012
|
|
2005
|
|||||||||
525 Cartier Boulevard West
|
|
Canada
|
|
—
|
|
|
2,926
|
|
|
18,746
|
|
|
—
|
|
|
2,926
|
|
|
18,746
|
|
|
21,672
|
|
|
(4,604
|
)
|
|
17,068
|
|
|
2004
|
|
2005
|
|||||||||
China
|
|
Asia
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85,845
|
|
|
—
|
|
|
85,845
|
|
|
85,845
|
|
|
(3,625
|
)
|
|
82,220
|
|
|
Various
|
|
2011
|
|||||||||
India
|
|
Asia
|
|
—
|
|
|
32,433
|
|
|
—
|
|
|
139,726
|
|
|
32,433
|
|
|
139,726
|
|
|
172,159
|
|
|
(5,746
|
)
|
|
166,413
|
|
|
Various
|
|
2009-2012
|
|||||||||
Various
|
|
Various
|
|
—
|
|
|
64,032
|
|
|
27,141
|
|
|
266,062
|
|
|
64,032
|
|
|
293,203
|
|
|
357,235
|
|
|
(28,564
|
)
|
|
328,671
|
|
|
Various
|
|
Various
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
$
|
652,209
|
|
|
$
|
1,057,802
|
|
|
$
|
2,791,443
|
|
|
$
|
4,497,016
|
|
|
$
|
1,057,802
|
|
|
$
|
7,288,459
|
|
|
$
|
8,346,261
|
|
|
$
|
(1,120,245
|
)
|
|
$
|
7,226,016
|
|
|
|
|
|
(1)
|
The aggregate cost of real estate for federal income tax purposes is not materially different from the cost basis under GAAP (unaudited).
|
(2)
|
The depreciable life for buildings and improvements ranges from
30
to
40
years,
20
for land improvements, and the term of the respective lease for tenant improvement.
|
(3)
|
Represents the later of the date of original construction or the date of the latest renovation.
|
(4)
|
Loan of
$30,377
secured by
four
properties identified by this reference.
|
(5)
|
Loan of
$77,316
secured by
six
properties identified by this reference.
|
(6)
|
Loan of
$129,367
secured by
four
properties identified by this reference.
|
(7)
|
Loan of
$113,567
secured by
six
properties identified by this reference.
|
(8)
|
The balance shown includes an unamortized premium of
$242
.
|
(9)
|
The balance shown includes an unamortized premium of
$27
.
|
(10)
|
Represents land and land improvements in Toronto, Canada that were classified in rental properties. This real estate was leased to a tenant and the tenant was completing the construction of a
780,540
RSF building. In December 2014, we determined that this property met the criteria to be classified as “held for sale”. In January 2015, we completed the sale.
|
|
|
December 31,
|
||||||||||
Rental Properties
|
|
2014
|
|
2013
|
|
2012
|
||||||
Balance at beginning of period
|
|
$
|
6,442,208
|
|
|
$
|
5,645,771
|
|
|
$
|
5,112,759
|
|
Purchase of rental properties
|
|
95,400
|
|
|
118,892
|
|
|
42,901
|
|
|||
Sale of rental properties
|
|
(7,541
|
)
|
|
(182,037
|
)
|
|
(30,807
|
)
|
|||
Write-off of fully amortized improvements
|
|
—
|
|
|
—
|
|
|
(17,730
|
)
|
|||
Transfers from current, near-term and future value-creation projects
|
|
458,246
|
|
|
859,582
|
|
|
538,648
|
|
|||
Balance at end of period
|
|
$
|
6,988,313
|
|
|
$
|
6,442,208
|
|
|
$
|
5,645,771
|
|
|
|
|
|
|
|
|
||||||
|
|
December 31,
|
||||||||||
Current, Near-Term and Future Value-Creation Projects
|
|
2014
|
|
2013
|
|
2012
|
||||||
Balance at beginning of period
|
|
$
|
1,286,812
|
|
|
$
|
1,653,842
|
|
|
$
|
1,638,216
|
|
Acquisitions
|
|
69,944
|
|
|
11,422
|
|
|
—
|
|
|||
Sales of land
|
|
(94,581
|
)
|
|
(67,880
|
)
|
|
(14,655
|
)
|
|||
Transfers to rental properties
|
|
(458,246
|
)
|
|
(859,582
|
)
|
|
(538,648
|
)
|
|||
Change in unconsolidated real estate joint venture
|
|
70,762
|
|
|
17,988
|
|
|
(13,686
|
)
|
|||
Additions to current, near-term and future value-creation projects
|
|
483,257
|
|
|
531,022
|
|
|
582,615
|
|
|||
Balance at end of period
|
|
$
|
1,357,948
|
|
|
$
|
1,286,812
|
|
|
$
|
1,653,842
|
|
|
|
|
||||||||||
|
|
December 31,
|
||||||||||
Accumulated Depreciation
|
|
2014
|
|
2013
|
|
2012
|
||||||
Balance at beginning of period
|
|
$
|
952,106
|
|
|
$
|
875,035
|
|
|
$
|
742,535
|
|
Depreciation expense on properties
|
|
183,432
|
|
|
149,848
|
|
|
157,193
|
|
|||
Write-off of fully amortized improvements
|
|
—
|
|
|
—
|
|
|
(17,730
|
)
|
|||
Sale of properties
|
|
(15,293
|
)
|
|
(72,777
|
)
|
|
(6,963
|
)
|
|||
Balance at end of period
|
|
$
|
1,120,245
|
|
|
$
|
952,106
|
|
|
$
|
875,035
|
|
Lead Independent Director
|
$
|
50,000
|
|
Audit Committee Chairperson
|
$
|
35,000
|
|
Compensation Committee Chairperson
|
$
|
35,000
|
|
Nominating & Governance Committee Chairperson
|
$
|
35,000
|
|
Audit Committee Member
|
$
|
15,000
|
|
Compensation Committee Member
|
$
|
15,000
|
|
Nominating & Governance Committee Member
|
$
|
15,000
|
|
Pricing Committee Member
|
$
|
6,000
|
|
|
|
Year Ended December 31,
|
|
|
||||||||||||||||||
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations before noncontrolling interests
(a)
|
|
$
|
104,991
|
|
|
$
|
139,349
|
|
|
$
|
96,712
|
|
|
$
|
117,316
|
|
|
$
|
122,038
|
|
|
|
Add: Interest expense
|
|
79,299
|
|
|
67,952
|
|
|
69,184
|
|
|
63,373
|
|
|
66,341
|
|
|
|
|||||
Subtract: Noncontrolling interests in income of subsidiaries that have not incurred fixed charges
|
|
(4,856
|
)
|
|
(954
|
)
|
|
(955
|
)
|
|
(1,323
|
)
|
|
(1,156
|
)
|
|
|
|||||
Earnings available for fixed charges
(b)
|
|
$
|
179,434
|
|
|
$
|
206,347
|
|
|
$
|
164,941
|
|
|
$
|
179,366
|
|
|
$
|
187,223
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed charges:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest incurred
|
|
$
|
126,287
|
|
|
$
|
128,038
|
|
|
$
|
131,424
|
|
|
$
|
120,610
|
|
|
$
|
132,345
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Preferred stock dividends
|
|
25,698
|
|
|
25,885
|
|
|
27,328
|
|
|
28,357
|
|
|
28,357
|
|
|
|
|||||
Preferred stock redemption charge
|
|
1,989
|
|
|
—
|
|
|
5,978
|
|
|
—
|
|
|
—
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total combined fixed charges and preferred stock dividends
|
|
$
|
153,974
|
|
|
$
|
153,923
|
|
|
$
|
164,730
|
|
|
$
|
148,967
|
|
|
$
|
160,702
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated ratio of earnings to fixed charges
|
|
1.42
|
|
(c)
|
1.61
|
|
|
1.26
|
|
(d)
|
1.49
|
|
|
1.41
|
|
(e)
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated ratio of earnings to combined fixed charges and preferred stock dividends
|
|
1.17
|
|
(c)
|
1.34
|
|
|
1.00
|
|
(d)
|
1.20
|
|
|
1.17
|
|
(e)
|
|
(a)
|
Includes gains on sales of land parcels that are not attributable to discontinued operations and excludes equity in earnings from unconsolidated joint ventures.
|
(b)
|
For purposes of calculating the consolidated ratio of earnings to fixed charges and consolidated ratio of earnings to combined fixed charges and preferred stock dividends, earnings consist of income from continuing operations before noncontrolling interests and interest expense less noncontrolling interests in income of subsidiaries that have not incurred fixed charges. Fixed charges consist of interest incurred (including amortization of deferred financing costs and capitalized interest).
|
(c)
|
Ratios for the year ended December 31, 2014, include the effect of losses on early extinguishment of debt aggregating $525 thousand, a preferred stock redemption charge of $2.0 million, impairment of land parcel of $24.7 million, and impairment of real estate of $27.0 million. Excluding the impact of losses on early extinguishment of debt, the preferred stock redemption charge, impairment of land parcel, and the impairment of real estate, the consolidated ratio of earnings to fixed charges and consolidated ratio of earnings to combined fixed charges and preferred stock dividends for the year ended December 31, 2012, were
1.83
and
1.52
, respectively.
|
(d)
|
Ratios for the year ended December 31, 2012, include the effect of losses on early extinguishment of debt aggregating $2.2 million, a preferred stock redemption charge of $6.0 million, impairment of land parcel of $2.1 million, and impairment of real estate of $11.4 million. Excluding the impact of losses on early extinguishment of debt, the preferred stock redemption charge, impairment of land parcel, and the impairment of real estate, the consolidated ratio of earnings to fixed charges and consolidated ratio of earnings to combined fixed charges and preferred stock dividends for the year ended December 31, 2012, were 1.42 and 1.13, respectively.
|
(e)
|
Ratios for the year ended December 31, 2010, include the effect of loss on early extinguishment of debt aggregating $45.2 million. Excluding the impact of loss on early extinguishment of debt, the consolidated ratio of earnings to fixed charges and the consolidated ratio of earnings to combined fixed charges and preferred stock dividends for the year ended December 31, 2010, were 1.76 and 1.45, respectively.
|
•
|
Could my outside business interests affect my job performance or my judgment on behalf of ARE or affect others with whom I work?
|
•
|
Can I reasonably conduct the activity outside of normal work hours?
|
•
|
Will I be using ARE equipment, materials or proprietary or confidential information in my activities?
|
•
|
Could the activity have any potential adverse or beneficial impact on ARE’s business or its relationships with tenants, partners or other entities with whom ARE does business?
|
•
|
Could the activity result in personal financial gain or other direct or indirect benefit to me or a member of my immediate family?
|
•
|
Could the activity appear improper to an outside observer?
|
|
|
|
Signature
|
|
Date
|
|
|
|
|
|
|
Printed Name
|
|
|
Name of Subsidiary
|
|
Jurisdiction of Organization
|
ARE - QRS Corp.
|
|
Maryland
|
Alexandria Real Estate Equities, L.P.
|
|
Delaware
|
ARE - Tech Square, LLC
|
|
Delaware
|
ARE - East River Science Park, LLC
|
|
Delaware
|
Alexandria Equities, LLC
|
|
Maryland
|
•
|
Registration Statements pertaining to the Amended and Restated 1997 Stock Award and Incentive Plan of Alexandria Real Estate Equities Inc. (Form S-8 No. 333-34223, Form S-8 No. 333-60075, Form S-8 No. 333-152433, Form S-8 No. 333-167889, and Form S-8 No. 333-197212),
|
•
|
Registration Statement (Form S-3 No. 333-181881) of Alexandria Real Estate Equities, Inc., and in the related Prospectus,
|
•
|
Registration Statement (Form S-3/A No. 333-56449) of Alexandria Real Estate Equities, Inc., and in the related Prospectus, and
|
•
|
Registration Statement (Form S-3/A No. 333-81985) of Alexandria Real Estate Equities, Inc., and in the related Prospectus.
|
|
/s/ Joel S. Marcus
|
|
Joel S. Marcus
|
|
Chief Executive Officer
|
|
/s/ Dean A. Shigenaga
|
|
Dean A. Shigenaga
|
|
Chief Financial Officer
|
|
/s/ Joel S. Marcus
|
|
Joel S. Marcus
|
|
Chief Executive Officer
|
|
/s/ Dean A. Shigenaga
|
|
Dean A. Shigenaga
|
|
Chief Financial Officer
|