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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
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, $0.01 par value per share
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ARE
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New York Stock Exchange
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Large accelerated filer
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x
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Smaller reporting company
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o
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Accelerated filer
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o
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Emerging growth company
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o
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Non-accelerated filer
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o
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PART I
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Page
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PART II
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PART III
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PART IV
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ASU
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Accounting Standards Update
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ATM
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At the Market
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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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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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GRESB
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Global Real Estate Sustainability Benchmark
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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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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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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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SF
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Square Feet/Foot
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SoMa
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South of Market submarket of San Francisco
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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 tenants;
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Condition and capacity of the building infrastructure;
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Physical condition of the structure and common area improvements;
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Quality and generic characteristics of the 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 space;
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Opportunities to generate higher rent through redevelopment of existing 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 access to diverse sources of capital, including operating cash flows after dividends, incremental debt, asset sales, and other capital such as the sale of equity or joint venture capital;
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Maintaining significant liquidity through borrowing capacity under our unsecured senior line of credit, available commitments under secured construction loans, marketable securities, and cash and cash equivalents;
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Continuing to improve our credit profile;
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Minimizing the amount of near-term debt maturities in a single year;
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Maintaining commitment to long-term capital to fund growth;
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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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Selectively selling real estate assets, including land parcels and non-core/“core-like” operating assets, and reinvesting the proceeds into our highly leased value-creation development projects;
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Allocating capital to Class A properties located in collaborative life science, technology, and agtech campuses in AAA urban innovation clusters;
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Maintaining geographic diversity in urban intellectual centers of innovation;
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Selectively acquiring high-quality office/laboratory and tech office space 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;
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Selectively redeveloping existing office, warehouse, or shell space, or newly acquired properties, into high-quality, generic, and reusable office/laboratory space that can be leased at higher rental rates in our target urban innovation cluster submarkets;
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Renewing existing 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 the leasing of vacant space and the replacing of existing tenants with new tenants at higher rental rates;
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Executing leases with high-quality tenants and proactively monitoring tenant health;
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Maintaining solid occupancy while attaining high rental rates;
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Realizing contractual rental rate escalations; and
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Implementing effective cost control measures, including negotiating pass-through provisions in tenant leases for operating expenses and certain capital expenditures.
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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 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 complete an acquisition because we cannot obtain debt and/or equity financing 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.
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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.
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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 the cleanup of undisclosed environmental contamination; claims by 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 encounter project delays or cancellations due to unavailability of necessary labor and construction materials;
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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 may deteriorate, which can result 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 or increases in tariffs;
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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 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 tenants’ specifications;
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Tenants that have pre-leased our development or redevelopment projects may file for bankruptcy or become insolvent, which may adversely affect the income produced by, and the value of, our properties or require us to change the scope of the project, which may potentially result 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, natural disasters, 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 our 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;
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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, 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 and political conditions;
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Competition from other properties;
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Changes in the life science, technology, and agtech 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 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 tenants;
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Liability or contract claims by or against 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 net income, funds from operations, or guidance;
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The publication of research reports and articles about us, our tenants, the real estate industry, or the life science, technology, and agtech 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 stockholders to demand a higher annual yield from future dividends;
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Fluctuations from general market volatility;
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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, departures, or other announcements regarding our 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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Fiscal policies or inaction at the U.S. federal government level that may lead to federal government shutdowns or negative impacts on the U.S. economy;
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Global market factors adversely affecting the U.S. economic and political environment;
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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 net 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;
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Changes in applicable laws and regulations in the U.S. that affect foreign operations;
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Challenges in managing foreign relations and trade disputes that adversely affect U.S. and foreign operations;
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Future partial or complete U.S. federal government shutdowns, trade disagreements with other countries, or uncertainties that could affect business transactions within the U.S. and with foreign entities;
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Changes in tax and local regulations with potentially adverse tax consequences and penalties; and
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Foreign ownership and transfer restrictions.
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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 venture partners 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 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 and state income taxes 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 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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Partnerships;
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Developers;
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Investment companies;
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Owners/occupants; and
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Foreign investors, including sovereign wealth funds.
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Greater Boston;
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San Francisco;
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New York City;
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San Diego;
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Seattle;
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Maryland; and
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Research Triangle.
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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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Some of our tenants develop and manufacture drugs that require regulatory approval, including approval from the FDA, 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 tenant may fail to obtain or may experience significant delays in obtaining these approvals. Even if the 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 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 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 tenants depend upon the commercial success of certain products. Even if a product made by a 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 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 tenants may prompt regulatory agencies to take actions that may adversely affect the clinical trials or products of our tenants.
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Some of our 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 industry; or federal, state, and local governments. Such funding may become unavailable or difficult to obtain. The ability of each tenant to raise capital will depend on its financial and operating condition, viability of their products, and the overall condition of the financial, banking, and economic environment, as well as government budget policies.
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Even with sufficient funding, some of our 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 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 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 tenants may cause their stock price or credit profile to deteriorate.
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Our 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 tenants and their licensors require patent, copyright, or trade secret protection to develop, make, market, and sell their products and technologies. A 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 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 tenants depend upon patents to provide exclusive marketing rights for their products. As their product patents expire, competitors of these tenants may be able to legally produce and market products similar to those products of our 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 and the halting of operations at certain agencies resulting from partial or complete U.S. federal government shutdowns may impede the growth of our technology industry 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 tenants.
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Some of our 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 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 cyber attacks and computer malware, viruses, worms, and similar programs, may materially affect the ability of our technology industry tenants to conduct business.
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Security breaches or network attacks may delay or interrupt the services provided by our tenants and could harm their reputations or subject them to significant liability.
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Some of our 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 tenant to raise capital will depend on its financial and operating condition, viability of their products, and the overall condition of the financial, banking, governmental budget policies, and economic environment.
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Even with sufficient funding, some of our 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 tenants may not be able to successfully manufacture their products economically.
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Marketed products also face commercialization risk, and some of our tenants may never realize projected levels of product utilization or revenues.
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Unfavorable news regarding the products or other business developments of our tenants may cause their stock price or credit profile to deteriorate.
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The products and services provided by some of our tenants are subject to the threat of piracy and unauthorized copying, and inadequate intellectual property laws and other inadequate protections could prevent them from enforcing or defending their proprietary technologies. These 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 tenants to incur significant costs to protect their intellectual property rights.
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Laws and regulations governing the Internet, e-commerce, electronic devices, and other services and products developed by the agtech industry are evolving. Existing and future laws and regulations and the halting of operations at certain agencies resulting from partial or complete U.S. federal government shutdowns may impede the growth of our agtech industry 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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Our agtech tenants businesses may fluctuate from time to time due to seasonal weather conditions and other factors out of their control, affecting products and services our agtech tenants’ offer.
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Some of our agtech tenants’ businesses depend on transportation services to deliver their products or to deliver raw materials to their clients. If transportation providers are unavailable or fail to deliver our agtech tenant’s products in a timely manner, they may be able to manufacture and deliver their services and products on a timely basis.
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Similarly, if fuel or other energy prices increase, it may increase transportation costs, which could affect our agtech tenants’ businesses.
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Our agtech tenants may face labor strikes, work slowdowns, labor contract negotiations or other job actions from their employees or third party contractors. In the event of a strike, work slowdown or other similar labor unrest, our tenants may not have the ability to adequately staff their businesses, which could have an adverse effect on their operations and revenue.
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The agtech industry is characterized by 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 agtech industry tenants.
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Technological advances in agriculture could decrease the demand for crop nutrients, energy and other crop input products and services our tenants provide. Genetically engineered crops that resist disease and insects could affect the demand for certain of our tenant’s products. Demand for fuel could decline as technology allows for more efficient usage of equipment.
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Restricted the deductibility of interest expense by businesses (generally, to 30% of the business’ adjusted taxable income) except, among others, real property businesses electing out of such restriction; generally, we expect our business to qualify as a real property business, but businesses conducted by our taxable REIT subsidiaries may not qualify;
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Required real property businesses to use the less favorable alternative depreciation system to depreciate real property in the event businesses elect to avoid the interest deduction restriction above;
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Restricted the benefits of like-kind exchanges that defer capital gains for tax purposes to exchanges of real property;
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•
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Required accrual method taxpayers to take certain amounts in income no later than the taxable year in which such income is taken into account as revenue in an applicable financial statement prepared under GAAP, which, with respect to certain leases, could accelerate the inclusion of rental income; and
|
•
|
Generally allowed a deduction for individuals equal to 20% of certain income from pass-through entities, including ordinary dividends distributed by a REIT (excluding capital gain dividends and qualified dividend income).
|
•
|
“Hardwired Approach,” which clearly specifies the SOFR-based successor rate and spread adjustment to be used when LIBOR ceases to exist.
|
•
|
“Amendment Approach,” which, unlike the Hardwired Approach, does not reference specific rates or spread adjustments but provides a streamlined amendment approach for negotiating a benchmark replacement and introduces clarity with respect to the fallback trigger events and an adjustment to be applied to the successor rate.
|
•
|
We have proactively reduced outstanding LIBOR-based borrowings under our unsecured senior bank term loans and secured construction loans through repayments. From January 2017 to December 2018, we retired approximately $942.0 million of such debt.
|
•
|
During the year ended December 31, 2019, we further reduced our exposure to LIBOR as follows:
|
•
|
Repaid the $350.0 million balance and extinguished our unsecured senior bank term loan.
|
•
|
Terminated our LIBOR-based interest rate hedge agreements aggregating $350.0 million in conjunction with the extinguishment of our unsecured senior bank term loan. As a result, we had no outstanding interest rate hedge agreements as of December 31, 2019.
|
•
|
Fully repaid outstanding balances aggregating $193.1 million under our LIBOR-based construction loans.
|
•
|
During the three months ended September 30, 2019, we established a commercial paper program, under which we have the ability to issue up to $750.0 million of commercial notes, bearing interest at short term fixed rates, with a maximum maturity of 397 days from the date of issuance. Our commercial paper program is not subjected to LIBOR and will be used for funding short-term working capital needs. As of December 31, 2019, we had no borrowings outstanding under our commercial paper program.
|
•
|
We continue to prudently manage outstanding borrowings under our unsecured senior line of credit, which represented less than 6% of our total debt balance outstanding as of December 31, 2019. Excluding LIBOR-based debt held by our unconsolidated joint ventures, borrowings under our unsecured senior line of credit represented our only LIBOR-based debt outstanding as of December 31, 2019.
|
•
|
Our unsecured senior line of credit contains fallback language generally consistent with the ARRC’s Amendment Approach, which provides a streamlined amendment approach for negotiating a benchmark replacement and introduces clarity with respect to the fallback trigger events and an adjustment to be applied to the successor rate.
|
•
|
We continue to monitor developments by the ARRC and other governing bodies involved in LIBOR transition.
|
•
|
The discharge of stormwater, wastewater, and any water pollutants;
|
•
|
The emission of air pollutants;
|
•
|
The generation, management, and disposal of hazardous or toxic chemicals, substances, or wastes; and
|
•
|
Workplace health and safety.
|
•
|
Asbestos surveys;
|
•
|
Radon surveys;
|
•
|
Lead-based paint surveys;
|
•
|
Mold surveys;
|
•
|
Additional public records review;
|
•
|
Subsurface sampling; and
|
•
|
Other testing.
|
•
|
Change in market conditions may affect our ability to deploy capital for projects that reduce energy consumption, greenhouse gas pollution and potable water consumption, and provide waste savings.
|
•
|
Our tenants might be unwilling or unable to accept potential incremental expenses associated with our sustainability programs, including expenses to comply with requirements stipulated under building certification standards such as LEED, WELL, and Fitwel.
|
•
|
New class A development properties that have received or are expected to receive Gold or Platinum LEED certification;
|
•
|
Existing class A redevelopment properties that have received or are expected to receive Gold or Platinum LEED certification; and
|
•
|
Tenant improvements that have received or are expected to receive Gold or Platinum LEED certification.
|
•
|
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;
|
•
|
Significant changes in the timing of revenue recognition (related to lease arrangements in which we are the lessor) or expense recognition (related to the lease arrangements in which we are the lessee) stemming from the potential classification of financing or sales-type leases under the new ASU, for leases that are classified as operating leases under the current accounting standards;
|
•
|
Significant fluctuations in our reported results of operations, including an increase in our expenses related to amortization of new lease-related assets and/or liabilities and assumed interest costs with leases;
|
•
|
Significant fluctuations in our reported results of operations, including an increase in our general and administrative expenses related to payroll costs, legal costs, and other out-of-pocket costs incurred as part of the leasing process prior to the execution of a lease that no longer qualifies for capitalization as initial direct costs and instead are expensed as incurred; and
|
•
|
Significant fluctuations in our reported results of operations that may result from the classification of future ground leases as finance leases rather than operating leases. Prior to January 1, 2019, the effective date of the new lease ASUs, all ground leases were accounted for as operating leases, with ground lease payments straight-lined over the term of the ground lease. Under the new lease accounting, ground leases can qualify for classification as finance leases, which are recognized in operating results using an effective interest method. The classification of ground leases as operating leases or finance leases may result in different timing of expense recognition over the term of the ground leases.
|
•
|
Theft of our cash, cash equivalents, or other liquid assets, including publicly traded securities;
|
•
|
Interruption in the operation of our systems, which may result in operational inefficiencies and a loss of profits;
|
•
|
Unauthorized access to, and destruction, loss, theft, misappropriation, or release of, proprietary, confidential, sensitive, or otherwise valuable information of ours or our tenants, and other business partners, which could be used to compete against us or for disruptive, destructive, or otherwise harmful purposes and outcomes;
|
•
|
Inability to produce financial and operational data necessary to comply with rules and regulations from the SEC, the IRS, or other state and federal regulatory agencies;
|
•
|
Our inability to properly monitor our compliance with the rules and regulations regarding our qualification as a REIT;
|
•
|
Significant management attention and resources required to remedy any damages that result;
|
•
|
Significant exposure to litigation and regulatory fines, penalties or other sanctions;
|
•
|
Violation of our lease agreements or other agreements;
|
•
|
Damage to our reputation among our tenants, business partners, and investors;
|
•
|
Loss of business opportunities; and
|
•
|
Difficulties in employee retention and recruitment.
|
•
|
The breadth of our operations and the high volume of transactions that our systems process;
|
•
|
The large number of our business partners; and
|
•
|
The proliferation and increasing sophistication of cyber attacks.
|
•
|
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 or publicly traded large cap tenants represented 50% of our total annual rental revenue;
|
•
|
Approximately 95% of our leases (on an RSF basis) contained effective annual rent escalations that were either fixed (generally ranging from approximately 3.0% to 3.5%) or indexed based on a consumer price index or other index;
|
•
|
Approximately 97% of our leases (on an RSF basis) were triple net leases, which require tenants to pay substantially all real estate taxes, insurance, utilities, repairs and maintenance, common area expenses, and other operating expenses (including increases thereto) in addition to base rent; and
|
•
|
Approximately 96% of our leases (on an RSF basis) provided for the recapture of capital expenditures (such as HVAC 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
|
|
Annual Rental Revenue
|
|||||||||||||||||||||||
Market
|
|
Operating
|
|
Development
|
|
Redevelopment
|
|
Total
|
|
% of Total
|
|
|
Total
|
|
% of Total
|
|
Per RSF
|
||||||||||||
Greater Boston
|
|
7,195,439
|
|
|
—
|
|
|
153,157
|
|
|
7,348,596
|
|
|
25
|
%
|
|
66
|
|
|
$
|
453,998
|
|
|
36
|
%
|
|
$
|
63.65
|
|
San Francisco
|
|
6,829,211
|
|
|
841,178
|
|
|
347,912
|
|
|
8,018,301
|
|
|
28
|
|
|
55
|
|
|
337,801
|
|
|
26
|
|
|
58.37
|
|
||
New York City
|
|
1,127,580
|
|
|
—
|
|
|
140,098
|
|
|
1,267,678
|
|
|
4
|
|
|
5
|
|
|
80,119
|
|
|
6
|
|
|
72.49
|
|
||
San Diego
|
|
5,731,061
|
|
|
232,818
|
|
|
—
|
|
|
5,963,879
|
|
|
20
|
|
|
75
|
|
|
204,900
|
|
|
16
|
|
|
38.75
|
|
||
Seattle
|
|
1,458,305
|
|
|
100,086
|
|
|
—
|
|
|
1,558,391
|
|
|
6
|
|
|
15
|
|
|
75,770
|
|
|
6
|
|
|
52.65
|
|
||
Maryland
|
|
2,663,891
|
|
|
261,096
|
|
|
41,098
|
|
|
2,966,085
|
|
|
10
|
|
|
42
|
|
|
73,868
|
|
|
6
|
|
|
28.87
|
|
||
Research Triangle
|
|
1,224,904
|
|
|
—
|
|
|
—
|
|
|
1,224,904
|
|
|
4
|
|
|
16
|
|
|
32,337
|
|
|
3
|
|
|
27.36
|
|
||
Canada
|
|
188,967
|
|
|
—
|
|
|
—
|
|
|
188,967
|
|
|
1
|
|
|
2
|
|
|
4,793
|
|
|
—
|
|
|
27.07
|
|
||
Non-cluster markets
|
|
369,770
|
|
|
—
|
|
|
—
|
|
|
369,770
|
|
|
1
|
|
|
12
|
|
|
10,597
|
|
|
1
|
|
|
35.77
|
|
||
Properties held for sale
|
|
191,862
|
|
|
—
|
|
|
—
|
|
|
191,862
|
|
|
1
|
|
|
3
|
|
|
4,073
|
|
|
—
|
|
|
N/A
|
|
||
North America
|
|
26,980,990
|
|
|
1,435,178
|
|
|
682,265
|
|
|
29,098,433
|
|
|
100
|
%
|
|
291
|
|
|
$
|
1,278,256
|
|
|
100
|
%
|
|
$
|
51.04
|
|
|
|
|
|
2,117,443
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Properties
|
|
Operating and Redevelopment Properties
|
||||||||||||||
Market
|
|
12/31/19
|
|
12/31/18
|
|
12/31/17
|
|
12/31/19
|
|
12/31/18
|
|
12/31/17
|
||||||
Greater Boston
|
|
99.1
|
%
|
|
98.7
|
%
|
|
96.6
|
%
|
|
97.1
|
%
|
|
98.2
|
%
|
|
95.7
|
%
|
San Francisco
|
|
98.3
|
|
|
100.0
|
|
|
99.6
|
|
|
93.6
|
|
|
96.2
|
|
|
99.6
|
|
New York City
|
|
99.2
|
|
|
98.3
|
|
|
99.8
|
|
|
88.1
|
|
|
87.3
|
|
|
99.8
|
|
San Diego
|
|
92.3
|
|
(1)
|
94.7
|
|
|
94.5
|
|
|
92.3
|
|
|
94.7
|
|
|
90.9
|
|
Seattle
|
|
98.7
|
|
|
97.7
|
|
|
97.7
|
|
|
98.7
|
|
|
97.7
|
|
|
97.7
|
|
Maryland
|
|
96.7
|
|
|
96.8
|
|
|
95.2
|
|
|
95.2
|
|
|
94.7
|
|
|
93.2
|
|
Research Triangle
|
|
96.5
|
|
|
95.4
|
|
|
98.1
|
|
|
96.5
|
|
|
85.9
|
|
|
84.0
|
|
Subtotal
|
|
97.0
|
|
|
97.6
|
|
|
97.0
|
|
|
94.6
|
|
|
95.3
|
|
|
94.9
|
|
Canada
|
|
93.7
|
|
|
95.2
|
|
|
99.6
|
|
|
93.7
|
|
|
95.2
|
|
|
99.6
|
|
Non-cluster markets
|
|
80.1
|
|
|
79.0
|
|
|
78.4
|
|
|
80.1
|
|
|
79.0
|
|
|
78.4
|
|
North America
|
|
96.8
|
%
|
(2)
|
97.3
|
%
|
|
96.8
|
%
|
|
94.4
|
%
|
|
95.1
|
%
|
|
94.7
|
%
|
(1)
|
Decline from December 31, 2018 primarily related to vacancy at the recently acquired SD Tech by Alexandria, partially offset by lease commencements at our Campus Pointe by Alexandria and University District campuses.
|
(2)
|
Includes 259,616 RSF, or 1.0%, of vacancy representing lease-up opportunities at properties recently acquired during the second half of 2019, primarily related to our SD Tech by Alexandria campus. Excluding these vacancies, occupancy of operating properties in North America would have been 97.8% as of December 31, 2019. Expected occupancy for the first quarter of 2020 includes 689,103 RSF, or 2.4%, of vacancy primarily from three buildings contributed by our partner in a recently formed consolidated real estate joint venture and our acquisition of SD Tech by Alexandria campus. Refer to the “Acquisitions” section under this Item 2 in this annual report on Form 10-K for additional information.
|
|
|
|
|
As of December 31, 2019
|
|
As of March 31, 2020 (projected)
|
||||||||||||||
|
|
|
|
|
|
Occupancy Impact
|
|
|
|
Occupancy Impact
|
||||||||||
Property
|
|
Submarket/Market
|
|
RSF
|
|
Region
|
|
Consolidated
|
|
RSF
|
|
Region
|
|
Consolidated
|
||||||
SD Tech by Alexandria
|
|
Sorrento Mesa/San Diego
|
|
182,056
|
|
|
3.2
|
%
|
|
0.7
|
%
|
|
225,865
|
|
|
3.8
|
%
|
|
0.8
|
%
|
601, 611, and 651 Gateway Boulevard
|
|
South San Francisco/San Francisco
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
211,454
|
|
|
2.7
|
%
|
|
0.7
|
%
|
Other acquisitions
|
|
Various
|
|
77,560
|
|
|
N/A
|
|
|
0.3
|
|
|
251,784
|
|
|
N/A
|
|
|
0.9
|
%
|
|
|
|
|
259,616
|
|
|
|
|
1.0
|
%
|
|
689,103
|
|
|
|
|
2.4
|
%
|
|
|
|
|
Remaining Lease Term(1)
(in Years)
|
|
|
Aggregate
RSF
|
|
|
|
Annual
Rental
Revenue(1)
|
|
|
Percentage of Aggregate Annual Rental Revenue(1)
|
|
Investment-Grade Credit Ratings
|
|
Average Market Cap(1)
(in billions)
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
|
Tenant
|
|
|
|
|
|
|
|
|
|
Moody’s
|
|
S&P
|
|
|
||||||||||||||||
1
|
|
|
Bristol-Myers Squibb Company
|
|
|
8.7
|
|
|
|
|
900,050
|
|
|
|
|
$
|
52,174
|
|
|
|
4.1
|
%
|
|
|
A2
|
|
A+
|
|
$
|
86.9
|
|
|
2
|
|
|
Takeda Pharmaceutical Company Ltd.
|
|
|
9.6
|
|
|
|
|
606,249
|
|
|
|
|
39,251
|
|
|
|
3.1
|
|
|
|
Baa2
|
|
BBB+
|
|
$
|
57.9
|
|
|
|
3
|
|
|
Facebook, Inc.
|
|
|
12.0
|
|
|
|
|
903,786
|
|
|
|
|
38,873
|
|
|
|
3.0
|
|
|
|
—
|
|
—
|
|
$
|
518.1
|
|
|
|
4
|
|
|
Illumina, Inc.
|
|
|
10.6
|
|
|
|
|
891,495
|
|
|
|
|
35,907
|
|
|
|
2.8
|
|
|
|
—
|
|
BBB
|
|
$
|
45.6
|
|
|
|
5
|
|
|
Eli Lilly and Company
|
|
|
9.4
|
|
|
|
|
554,089
|
|
|
|
|
34,096
|
|
|
|
2.7
|
|
|
|
A2
|
|
A+
|
|
$
|
115.9
|
|
|
|
6
|
|
|
Sanofi
|
|
|
8.5
|
|
|
|
|
494,693
|
|
|
|
|
33,845
|
|
|
|
2.6
|
|
|
|
A1
|
|
AA
|
|
$
|
109.7
|
|
|
|
7
|
|
|
Novartis AG
|
|
|
8.3
|
|
|
|
|
378,894
|
|
|
|
|
27,849
|
|
|
|
2.2
|
|
|
|
A1
|
|
AA-
|
|
$
|
224.8
|
|
|
|
8
|
|
|
Uber Technologies, Inc.
|
|
|
62.8
|
|
(3)
|
|
|
1,016,745
|
|
|
|
|
27,445
|
|
|
|
2.1
|
|
|
|
—
|
|
—
|
|
$
|
60.3
|
|
|
|
9
|
|
|
Merck & Co., Inc.
|
|
|
11.4
|
|
|
|
|
421,623
|
|
|
|
|
24,290
|
|
|
|
1.9
|
|
|
|
A1
|
|
AA
|
|
$
|
211.4
|
|
|
|
10
|
|
|
bluebird bio, Inc.
|
|
|
7.4
|
|
|
|
|
312,805
|
|
|
|
|
23,076
|
|
|
|
1.8
|
|
|
|
—
|
|
—
|
|
$
|
6.5
|
|
|
|
11
|
|
|
Moderna, Inc.
|
|
|
9.9
|
|
|
|
|
382,388
|
|
|
|
|
22,665
|
|
|
|
1.8
|
|
|
|
—
|
|
—
|
|
$
|
6.0
|
|
|
|
12
|
|
|
Maxar Technologies(2)
|
|
|
5.5
|
|
|
|
|
478,000
|
|
|
|
|
21,577
|
|
|
|
1.7
|
|
|
|
—
|
|
—
|
|
$
|
0.5
|
|
|
|
13
|
|
|
New York University
|
|
|
11.7
|
|
|
|
|
201,284
|
|
|
|
|
19,011
|
|
|
|
1.5
|
|
|
|
Aa2
|
|
AA-
|
|
$
|
—
|
|
|
|
14
|
|
|
Roche
|
|
|
3.5
|
|
|
|
|
365,309
|
|
|
|
|
18,996
|
|
|
|
1.5
|
|
|
|
Aa3
|
|
AA
|
|
$
|
240.2
|
|
|
|
15
|
|
|
Pfizer Inc.
|
|
|
5.2
|
|
|
|
|
416,979
|
|
|
|
|
17,754
|
|
|
|
1.4
|
|
|
|
A1
|
|
AA-
|
|
$
|
223.3
|
|
|
|
16
|
|
|
Stripe, Inc.
|
|
|
7.8
|
|
|
|
|
295,333
|
|
|
|
|
17,736
|
|
|
|
1.4
|
|
|
|
—
|
|
—
|
|
$
|
—
|
|
|
|
17
|
|
|
athenahealth, Inc.(2)
|
|
|
12.5
|
|
|
|
|
409,710
|
|
|
|
|
17,632
|
|
|
|
1.4
|
|
|
|
—
|
|
—
|
|
$
|
5.6
|
|
|
|
18
|
|
|
Massachusetts Institute of Technology
|
|
|
5.7
|
|
|
|
|
257,626
|
|
|
|
|
17,306
|
|
|
|
1.4
|
|
|
|
Aaa
|
|
AAA
|
|
$
|
—
|
|
|
|
19
|
|
|
Amgen Inc.
|
|
|
4.3
|
|
|
|
|
407,369
|
|
|
|
|
16,838
|
|
|
|
1.3
|
|
|
|
Baa1
|
|
A-
|
|
$
|
119.3
|
|
|
|
20
|
|
|
United States Government
|
|
|
8.0
|
|
|
|
|
284,998
|
|
|
|
|
16,384
|
|
|
|
1.3
|
|
|
|
Aaa
|
|
AA+
|
|
$
|
—
|
|
|
|
|
|
Total/weighted average
|
|
|
11.6
|
|
(3)
|
|
|
9,979,425
|
|
|
|
|
$
|
522,705
|
|
|
|
41.0
|
%
|
|
|
|
|
|
|
|
|
(1)
|
Based on aggregate annual rental revenue in effect as of December 31, 2019. Refer to the definitions of “Annual Rental Revenue” and “Investment-Grade or Publicly Traded Large Cap Tenants” in the “Non-GAAP Measures and Definitions” section under Item 7 of this annual report on Form 10-K for additional information on our methodology on annual rental revenue from unconsolidated real estate joint ventures and average daily market capitalization.
|
(2)
|
Annual rental revenue from investment-grade or publicly traded large cap tenants includes two tenants, Maxar Technologies and athenahealth, Inc., located in properties acquired during the three months ended December 31, 2019. Excluding these two tenants, our annual rental revenue from investment-grade or publicly traded large cap tenants within our top 20 tenants was 87%.
|
(3)
|
Includes a ground lease for land at 1455 and 1515 Third Street (two buildings aggregating 422,980 RSF) and a lease at 1655 and 1725 Third Street (two buildings aggregating 593,765 RSF) owned by our unconsolidated joint venture in which we have an ownership interest of 10%. Annual rental revenue is presented using 100% of the annual rental revenue of our consolidated properties and our share of annual rental revenue of our unconsolidated real estate joint ventures. Refer to footnote 1 for additional information. Excluding the ground lease, the weighted-average remaining lease term for our top 20 tenants was 8.9 years as of December 31, 2019.
|
(1)
|
Represents annual rental revenue in effect as of December 31, 2019. Refer to the “Non-GAAP Measures and Definitions” section under Item 7 in this annual report on Form 10-K for additional information.
|
(2)
|
Based on aggregate annual rental revenue in effect as of December 31, 2019. Refer to definition of “Annual Rental Revenue” in the “Non-GAAP Measures and Definitions” section under Item 7 in this annual report on Form 10-K for our methodology on annual rental revenue for unconsolidated real estate joint ventures.
|
(3)
|
67% of our annual rental revenue for technology tenants is from investment-grade or publicly traded large cap tenants.
|
(1)
|
Represents annual rental revenue in effect as of December 31, 2019. Refer to the “Non-GAAP Measures and Definitions” section under Item 7 in this annual report on Form 10-K for additional information.
|
(2)
|
Represents average occupancy of operating properties in North America as of each December 31 for the last 10 years.
|
(3)
|
As of December 31, 2019.
|
(4)
|
Includes 259,616 RSF, or 1.0%, of vacancy representing lease-up opportunities at properties recently acquired during the second half of 2019, primarily related to our SD Tech by Alexandria campus. Excluding these vacancies, occupancy of operating properties in North America would have been 97.8% as of December 31, 2019. Refer to the “Summary of Occupancy Percentages in North America” section under this Item 2 in this annual report on Form 10-K for additional information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Occupancy Percentage
|
|
||||||||||
|
|
|
|
RSF
|
|
Number of Properties
|
|
Annual Rental Revenue
|
|
|
|||||||||||||||||
|
|
|
|
|
|
|
Operating
|
|
Operating and Redevelopment
|
|
|||||||||||||||||
Market / Submarket / Address
|
|
Operating
|
|
Development
|
|
Redevelopment
|
|
Total
|
|
|
|
|
|
||||||||||||||
Research Triangle
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Research Triangle
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
Alexandria Technology Center® – Alston
|
|
186,870
|
|
|
—
|
|
|
—
|
|
|
186,870
|
|
|
3
|
|
$
|
3,855
|
|
|
95.0
|
%
|
|
95.0
|
%
|
|
|
|
100, 800, and 801 Capitola Drive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Alexandria Center® for AgTech, Phase I – Research Triangle
|
|
180,400
|
|
|
—
|
|
|
—
|
|
|
180,400
|
|
|
1
|
|
5,241
|
|
|
95.3
|
|
|
95.3
|
|
|
|
|
|
5 Laboratory Drive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
108/110/112/114 TW Alexander Drive
|
|
158,417
|
|
|
—
|
|
|
—
|
|
|
158,417
|
|
|
1
|
|
4,681
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
|
Alexandria Innovation Center® – Research Triangle
|
|
136,455
|
|
|
—
|
|
|
—
|
|
|
136,455
|
|
|
3
|
|
3,683
|
|
|
98.1
|
|
|
98.1
|
|
|
|
|
|
7010, 7020, and 7030 Kit Creek Road
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
6 Davis Drive
|
|
100,000
|
|
|
—
|
|
|
—
|
|
|
100,000
|
|
|
1
|
|
1,909
|
|
|
92.4
|
|
|
92.4
|
|
|
|
|
|
7 Triangle Drive
|
|
96,626
|
|
|
—
|
|
|
—
|
|
|
96,626
|
|
|
1
|
|
3,156
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
|
2525 East NC Highway 54
|
|
82,996
|
|
|
—
|
|
|
—
|
|
|
82,996
|
|
|
1
|
|
3,651
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
|
407 Davis Drive
|
|
81,956
|
|
|
—
|
|
|
—
|
|
|
81,956
|
|
|
1
|
|
1,644
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
|
601 Keystone Park Drive
|
|
77,395
|
|
|
—
|
|
|
—
|
|
|
77,395
|
|
|
1
|
|
1,350
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
|
6040 George Watts Hill Drive
|
|
61,547
|
|
|
—
|
|
|
—
|
|
|
61,547
|
|
|
1
|
|
2,148
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
|
5 Triangle Drive
|
|
32,120
|
|
|
—
|
|
|
—
|
|
|
32,120
|
|
|
1
|
|
479
|
|
|
54.2
|
|
|
54.2
|
|
|
|
|
|
6101 Quadrangle Drive
|
|
30,122
|
|
|
—
|
|
|
—
|
|
|
30,122
|
|
|
1
|
|
540
|
|
|
100.0
|
|
|
100.0
|
|
|
|
|
|
Research Triangle
|
|
1,224,904
|
|
|
—
|
|
|
—
|
|
|
1,224,904
|
|
|
16
|
|
32,337
|
|
|
96.5
|
|
|
96.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Canada
|
|
188,967
|
|
|
—
|
|
|
—
|
|
|
188,967
|
|
|
2
|
|
4,793
|
|
|
93.7
|
|
|
93.7
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Non-cluster markets
|
|
369,770
|
|
|
—
|
|
|
—
|
|
|
369,770
|
|
|
12
|
|
10,597
|
|
|
80.1
|
|
|
80.1
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
North America, excluding properties held for sale
|
|
26,789,128
|
|
|
1,435,178
|
|
|
682,265
|
|
|
28,906,571
|
|
|
288
|
|
1,274,183
|
|
|
96.8
|
%
|
|
94.4
|
%
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Properties held for sale
|
|
191,862
|
|
|
—
|
|
|
—
|
|
|
191,862
|
|
|
3
|
|
4,073
|
|
|
71.4
|
%
|
|
71.4
|
%
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total – North America
|
|
26,980,990
|
|
|
1,435,178
|
|
|
682,265
|
|
|
29,098,433
|
|
|
291
|
|
$
|
1,278,256
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
•
|
Executed a total of 241 leases, with a weighted-average lease term of 7.8 years, for 5.1 million RSF, including 1.4 million RSF related to our development and redevelopment projects, during the year ended December 31, 2019; leasing activity of 5.1 million RSF represents the highest annual leasing activity in Alexandria’s history; and
|
•
|
Strong rental rate increases of 32.2% and 17.6% (cash basis), representing our highest annual increase during the past 10 years.
|
|
|
|
Year Ended December 31,
|
||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||
|
|
Including
Straight-Line Rent |
|
Cash Basis
|
|
Including
Straight-Line Rent
|
|
Cash Basis
|
||||||||
(Dollars per RSF)
|
|
|
|
|
|
|
|
|
||||||||
Leasing activity:
|
|
|
|
|
|
|
|
|
||||||||
Renewed/re-leased space(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Rental rate changes
|
|
32.2%
|
|
|
17.6%
|
|
|
24.1%
|
|
|
14.1%
|
|
||||
New rates
|
|
|
$58.65
|
|
|
|
$56.19
|
|
|
|
$55.05
|
|
|
|
$52.79
|
|
Expiring rates
|
|
|
$44.35
|
|
|
|
$47.79
|
|
|
|
$44.35
|
|
|
|
$46.25
|
|
RSF
|
|
2,427,108
|
|
|
|
|
2,088,216
|
|
|
|
||||||
Tenant improvements/leasing commissions
|
|
|
$20.28
|
|
|
|
|
|
$20.61
|
|
|
|
||||
Weighted-average lease term
|
|
5.7 years
|
|
|
|
|
6.1 years
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||||
Developed/redeveloped/previously vacant space leased
|
|
|
|
|
|
|
|
|
||||||||
New rates
|
|
|
$55.95
|
|
|
|
$52.19
|
|
|
|
$58.45
|
|
|
|
$48.73
|
|
RSF
|
|
2,635,614
|
|
|
|
|
2,633,476
|
|
|
|
||||||
Tenant improvements/leasing commissions
|
|
|
$13.74
|
|
|
|
|
|
$12.57
|
|
|
|
||||
Weighted-average lease term
|
|
9.8 years
|
|
|
|
|
11.5 years
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||||
Leasing activity summary (totals):
|
|
|
|
|
|
|
|
|
||||||||
New rates
|
|
|
$57.25
|
|
|
|
$54.11
|
|
|
|
$56.94
|
|
|
|
$50.52
|
|
RSF
|
|
5,062,722
|
|
(2)
|
|
|
4,721,692
|
|
|
|
||||||
Tenant improvements/leasing commissions
|
|
|
$16.88
|
|
|
|
|
|
$16.13
|
|
|
|
||||
Weighted-average lease term
|
|
7.8 years
|
|
|
|
|
9.1 years
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
||||||||
Lease expirations(1)
|
|
|
|
|
|
|
|
|
||||||||
Expiring rates
|
|
|
$43.43
|
|
|
|
$46.59
|
|
|
|
$42.98
|
|
|
|
$45.33
|
|
RSF
|
|
2,822,434
|
|
|
|
|
2,811,021
|
|
|
|
(1)
|
Excludes month-to-month leases aggregating 41,809 RSF and 50,548 RSF as of December 31, 2019 and 2018, respectively.
|
(2)
|
During the year ended December 31, 2019, we granted tenant concessions/free rent averaging 2.4 months with respect to the 5,062,722 RSF leased. Approximately 59% of the leases executed during the year ended December 31, 2019, did not include concessions for free rent.
|
Year
|
|
RSF
|
|
Percentage of
Occupied RSF |
|
Annual Rental Revenue
(Per RSF)(1) |
|
Percentage of Total
Annual Rental Revenue |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
2020
|
(2)
|
|
|
1,745,030
|
|
|
|
|
6.7
|
%
|
|
|
|
$
|
35.27
|
|
|
|
|
4.7
|
%
|
|
|
2021
|
|
|
|
1,531,070
|
|
|
|
|
5.9
|
%
|
|
|
|
$
|
42.09
|
|
|
|
|
4.9
|
%
|
|
|
2022
|
|
|
|
2,164,448
|
|
|
|
|
8.3
|
%
|
|
|
|
$
|
42.07
|
|
|
|
|
7.0
|
%
|
|
|
2023
|
|
|
|
2,564,766
|
|
|
|
|
9.9
|
%
|
|
|
|
$
|
45.66
|
|
|
|
|
9.0
|
%
|
|
|
2024
|
|
|
|
2,300,974
|
|
|
|
|
8.8
|
%
|
|
|
|
$
|
46.33
|
|
|
|
|
8.2
|
%
|
|
|
2025
|
|
|
|
1,786,892
|
|
|
|
|
6.9
|
%
|
|
|
|
$
|
48.78
|
|
|
|
|
6.7
|
%
|
|
|
2026
|
|
|
|
1,597,511
|
|
|
|
|
6.1
|
%
|
|
|
|
$
|
49.33
|
|
|
|
|
6.0
|
%
|
|
|
2027
|
|
|
|
2,366,266
|
|
|
|
|
9.1
|
%
|
|
|
|
$
|
51.72
|
|
|
|
|
9.4
|
%
|
|
|
2028
|
|
|
|
1,646,032
|
|
|
|
|
6.3
|
%
|
|
|
|
$
|
60.18
|
|
|
|
|
7.6
|
%
|
|
|
2029
|
|
|
|
1,350,014
|
|
|
|
|
5.2
|
%
|
|
|
|
$
|
57.24
|
|
|
|
|
5.9
|
%
|
|
Thereafter
|
|
|
6,954,809
|
|
|
|
|
26.8
|
%
|
|
|
|
$
|
57.88
|
|
|
|
|
30.6
|
%
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Represents amounts in effect as of December 31, 2019.
|
(2)
|
Excludes month-to-month leases aggregating 41,809 RSF as of December 31, 2019.
|
|
|
2020 Contractual Lease Expirations (in RSF)
|
|
Annual Rental Revenue
(Per RSF)(3) |
|||||||||||||||
Market
|
|
Leased
|
|
Negotiating/
Anticipating |
|
Targeted for
Redevelopment |
|
Remaining
Expiring Leases(1) |
|
Total(2)
|
|
||||||||
|
|
|
|
|
|
||||||||||||||
Greater Boston
|
|
107,773
|
|
|
122,950
|
|
|
75,754
|
|
(4)
|
232,547
|
|
|
539,024
|
|
|
$
|
41.32
|
|
San Francisco
|
|
81,493
|
|
|
25,569
|
|
|
—
|
|
|
174,380
|
|
(5)
|
281,442
|
|
|
44.08
|
|
|
New York City
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,712
|
|
|
20,712
|
|
|
99.30
|
|
|
San Diego
|
|
37,880
|
|
|
—
|
|
|
—
|
|
|
378,021
|
|
(6)
|
415,901
|
|
|
30.85
|
|
|
Seattle
|
|
12,727
|
|
|
—
|
|
|
—
|
|
|
32,047
|
|
|
44,774
|
|
|
38.70
|
|
|
Maryland
|
|
16,235
|
|
|
33,778
|
|
|
—
|
|
|
97,317
|
|
|
147,330
|
|
|
17.40
|
|
|
Research Triangle
|
|
37,881
|
|
|
25,396
|
|
|
—
|
|
|
36,290
|
|
|
99,567
|
|
|
17.74
|
|
|
Canada
|
|
72,250
|
|
|
—
|
|
|
—
|
|
|
22,343
|
|
|
94,593
|
|
|
28.22
|
|
|
Non-cluster markets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
101,687
|
|
|
101,687
|
|
|
31.29
|
|
|
Total
|
|
366,239
|
|
|
207,693
|
|
|
75,754
|
|
|
1,095,344
|
|
|
1,745,030
|
|
|
$
|
35.27
|
|
Percentage of expiring leases
|
|
21
|
%
|
|
12
|
%
|
|
4
|
%
|
|
63
|
%
|
|
100
|
%
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
2021 Contractual Lease Expirations (in RSF)
|
|
Annual Rental Revenue
(Per RSF)(3) |
|||||||||||||||
Market
|
|
Leased
|
|
Negotiating/
Anticipating |
|
Targeted for
Redevelopment |
|
Remaining
Expiring Leases |
|
Total
|
|
||||||||
|
|
|
|
|
|
||||||||||||||
Greater Boston
|
|
—
|
|
|
25,970
|
|
|
79,101
|
|
(4)
|
267,624
|
|
|
372,695
|
|
|
$
|
44.10
|
|
San Francisco
|
|
24,193
|
|
|
9,628
|
|
|
—
|
|
|
364,747
|
|
|
398,568
|
|
|
52.99
|
|
|
New York City
|
|
—
|
|
|
19,647
|
|
|
—
|
|
|
15,466
|
|
|
35,113
|
|
|
97.45
|
|
|
San Diego
|
|
634
|
|
|
74,557
|
|
|
—
|
|
|
223,991
|
|
|
299,182
|
|
|
38.81
|
|
|
Seattle
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52,320
|
|
|
52,320
|
|
|
45.48
|
|
|
Maryland
|
|
—
|
|
|
—
|
|
|
—
|
|
|
160,439
|
|
|
160,439
|
|
|
22.51
|
|
|
Research Triangle
|
|
3,724
|
|
|
34,553
|
|
|
—
|
|
|
133,592
|
|
|
171,869
|
|
|
25.99
|
|
|
Canada
|
|
—
|
|
|
4,345
|
|
|
—
|
|
|
18,612
|
|
|
22,957
|
|
|
27.13
|
|
|
Non-cluster markets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,927
|
|
|
17,927
|
|
|
42.50
|
|
|
Total
|
|
28,551
|
|
|
168,700
|
|
|
79,101
|
|
|
1,254,718
|
|
|
1,531,070
|
|
|
$
|
42.09
|
|
Percentage of expiring leases
|
|
2
|
%
|
|
11
|
%
|
|
5
|
%
|
|
82
|
%
|
|
100
|
%
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The largest remaining contractual lease expiration in 2020 is 60,759 RSF in our Greater Boston market.
|
(2)
|
Excludes month-to-month leases aggregating 41,809 RSF as of December 31, 2019.
|
(3)
|
Represents amounts in effect as of December 31, 2019.
|
(4)
|
Represents office space aggregating 154,855 RSF at The Arsenal on the Charles, a campus acquired on December 17, 2019, in our Cambridge/Inner Suburbs submarket, that is targeted for redevelopment into office/laboratory space upon expiration of existing leases during the third quarter of 2020 and first quarter of 2021.
|
(5)
|
Includes two leases aggregating 100,560 RSF at 630 and 650 Gateway Boulevard in our South San Francisco submarket that expire during the fourth quarter of 2020. We are considering options to renovate these buildings into Class A office/laboratory properties, which will not be classified as a redevelopment. As such, we expect these properties to remain in our pool of same properties.
|
(6)
|
Includes 140,398 RSF at 9363, 9373, and 9393 Towne Centre Drive in our University Town Center submarket, a site that is under evaluation to be developed, subject to future market conditions.
|
|
|
|
|
Development and Redevelopment
|
|
|
||||||||||||||||||||||
|
|
Operating
|
|
Under Construction
|
|
Near-Term
|
|
Intermediate-Term
|
|
Future
|
|
Subtotal
|
|
Total
|
||||||||||||||
Investments in real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Book value as of December 31, 2019(1)
|
|
$
|
15,278,779
|
|
|
$
|
991,007
|
|
|
$
|
447,798
|
|
|
$
|
618,279
|
|
|
$
|
182,746
|
|
|
$
|
2,239,830
|
|
|
$
|
17,518,609
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Square footage
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Operating
|
|
26,980,990
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,980,990
|
|
|||||||
New Class A development and redevelopment properties
|
|
—
|
|
|
2,117,443
|
|
|
2,127,925
|
|
|
4,884,067
|
|
|
4,585,477
|
|
|
13,714,912
|
|
|
13,714,912
|
|
|||||||
Value-creation square feet currently included in rental properties(2)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(702,012
|
)
|
|
(823,104
|
)
|
|
(1,525,116
|
)
|
|
(1,525,116
|
)
|
|||||||
Total square footage
|
|
26,980,990
|
|
|
2,117,443
|
|
|
2,127,925
|
|
|
4,182,055
|
|
|
3,762,373
|
|
|
12,189,796
|
|
|
39,170,786
|
|
(1)
|
Balances exclude our share of the cost basis associated with our unconsolidated properties, which is classified as investments in unconsolidated real estate joint ventures in our consolidated balance sheets.
|
(2)
|
Refer to the definition of “Investment in Real Estate” in the “Non-GAAP Measures and Definitions” section under Item 7 in this annual report on Form 10-K for additional detail on value-creation square feet currently included in rental properties.
|
Property
|
|
Submarket/Market
|
|
Date of Purchase
|
|
Number of Properties
|
|
Operating
Occupancy
|
|
Square Footage
|
|
Unlevered Yields
|
|
Purchase Price
|
||||||||||||||||||||||
|
|
|
|
Future Development
|
|
Active Redevelopment
|
|
Operating With Future Development/ Redevelopment
|
|
Operating
|
|
Initial Stabilized
|
|
Initial Stabilized (Cash)
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Three months ended March 31, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
3170 Porter Drive
|
|
Greater Stanford/
San Francisco |
|
1/10/19
|
|
1
|
|
100
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
98,626
|
|
|
7.5%
|
|
5.1%
|
|
$
|
100,250
|
|
|
||||
10 Necco Street
|
|
Seaport Innovation District/Greater Boston
|
|
3/26/19
|
|
—
|
|
N/A
|
|
|
|
175,000
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
|
81,100
|
|
|
Shoreway Science Center
|
|
Greater Stanford/
San Francisco |
|
1/10/19
|
|
2
|
|
100
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
82,462
|
|
|
7.2%
|
|
5.5%
|
|
|
73,200
|
|
|
||||
260 Townsend Street
|
|
Mission Bay/SoMa/
San Francisco |
|
3/14/19
|
|
1
|
|
100
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
66,682
|
|
|
7.4%
|
|
5.8%
|
|
|
66,000
|
|
|
||||
3911 and 3931 Sorrento Valley Boulevard
|
|
Sorrento Valley/
San Diego
|
|
1/9/19
|
|
2
|
|
100
|
%
|
|
|
—
|
|
|
—
|
|
|
53,220
|
|
|
|
—
|
|
|
7.2%
|
|
6.6%
|
|
|
23,250
|
|
|
||||
Other
|
|
|
|
|
|
4
|
|
100
|
%
|
|
|
—
|
|
|
—
|
|
|
75,864
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
39,150
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Three months ended June 30, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
5 Necco Street
|
|
Seaport Innovation District/Greater Boston
|
|
5/9/19
|
|
1
|
|
87
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
87,163
|
|
|
5.2%
|
|
5.1%
|
|
|
252,000
|
|
|
||||
15 Necco Street
|
|
|
|
—
|
|
N/A
|
|
|
|
293,000
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
|
|
||||
601 Dexter Avenue North
|
|
Lake Union/Seattle
|
|
6/18/19
|
|
1
|
|
100
|
%
|
|
|
188,400
|
|
|
—
|
|
|
18,680
|
|
|
|
—
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
|
28,500
|
|
|
4075 Sorrento Valley Boulevard
|
|
Sorrento Valley/
San Diego
|
|
5/13/19
|
|
1
|
|
100
|
%
|
|
|
149,000
|
|
|
—
|
|
|
40,000
|
|
|
|
—
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
|
16,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Three months ended September 30, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
945 Market Street (99.5% interest in consolidated JV)
|
|
Mission Bay/SoMa/
San Francisco
|
|
7/31/19
|
|
1
|
|
N/A
|
|
|
|
—
|
|
|
255,765
|
|
|
—
|
|
|
|
—
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
|
179,000
|
|
|
4224/4242 Campus Point Court and 10210 Campus Point Drive
(55% interest in consolidated JV) |
|
University Town Center/San Diego
|
|
7/9/19
|
|
3
|
|
83
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
314,103
|
|
|
6.9%
|
|
6.0%
|
|
|
255,000
|
|
(2)
|
||||
25, 35, and 45 West Watkins Mill Road
|
|
Gaithersburg/Maryland
|
|
8/21/19
|
|
3
|
|
87
|
%
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
138,938
|
|
|
N/A
|
|
N/A
|
|
|
51,130
|
|
|
||||
3160 Porter Drive
|
|
Greater Stanford/
San Francisco
|
|
8/12/19
|
|
1
|
|
N/A
|
|
|
|
—
|
|
|
92,147
|
|
|
—
|
|
|
|
—
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
|
26,000
|
|
|
47-50 30th Street
|
|
New York City/
New York City |
|
7/10/19
|
|
—
|
|
N/A
|
|
|
|
135,938
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
(1)
|
|
|
|
(1)
|
|
|
|
|
25,000
|
|
|
Other
|
|
Various
|
|
|
|
3
|
|
37
|
%
|
|
|
54,000
|
|
|
—
|
|
|
58,814
|
|
|
|
34,534
|
|
|
|
|
|
|
|
|
|
37,850
|
|
|
||
(1) We expect to provide total estimated costs and related yields in the future, subsequent to the commencement of development or redevelopment.
(2) Includes $114.8 million related to our partner’s noncontrolling interest in the consolidated real estate joint venture at 4224/4242 Campus Point Court and 10210 Campus Point Drive to reflect the full contractual purchase price.
|
Property
|
|
Submarket/Market
|
|
Date of Purchase
|
|
Number of Properties
|
|
Operating
Occupancy
|
|
Square Footage
|
|
Unlevered Yields
|
|
Purchase Price
|
||||||||||||||||||||||
|
|
|
|
Future Development
|
|
Active Redevelopment
|
|
Operating With Future Development/ Redevelopment
|
|
Operating
|
|
Initial Stabilized
|
|
Initial Stabilized (Cash)
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Three months ended December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
The Arsenal on the Charles
|
|
Cambridge/Inner Suburbs/Greater Boston
|
|
12/17/19
|
|
11
|
|
100
|
%
|
|
|
200,000
|
|
|
153,157
|
|
|
154,855
|
|
(1)
|
|
528,276
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
$
|
525,500
|
|
|
3825 and 3875 Fabian Way
|
|
Greater Stanford/
San Francisco |
|
12/10/19
|
|
2
|
|
100
|
%
|
|
|
—
|
|
|
—
|
|
|
478,000
|
|
|
|
—
|
|
|
8.2
|
%
|
(3)
|
|
6.9
|
%
|
(3)
|
|
|
291,000
|
|
|
SD Tech by Alexandria (50% interest in consolidated JV)
|
|
Sorrento Mesa/
San Diego
|
|
10/30/19
|
|
10
|
|
71
|
%
|
|
|
720,000
|
|
|
—
|
|
|
—
|
|
|
|
598,316
|
|
(4)
|
6.6
|
%
|
(4)
|
|
6.5
|
%
|
(4)
|
|
|
114,964
|
|
|
14200 Shady Grove Road
|
|
Rockville/Maryland
|
|
10/31/19
|
|
—
|
|
N/A
|
|
|
|
435,000
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
|
|
25,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
10260 Campus Point Drive and
4161 Campus Point Court
|
|
University Town Center/San Diego
|
|
1/2/19
|
|
N/A
|
|
N/A
|
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
|
N/A
|
|
|
(5
|
)
|
|
|
(5
|
)
|
|
|
|
65,000
|
|
(6)
|
2019 acquisitions
|
|
|
|
|
|
47
|
|
83
|
%
|
|
|
2,350,338
|
|
|
501,069
|
|
|
879,433
|
|
|
|
1,949,100
|
|
|
|
|
|
|
|
|
$
|
2,274,894
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Represents leased square footage with contractual lease expirations in the third quarter of 2020 and first quarter of 2021. Upon expiration of the existing leases, we anticipate this RSF will be redeveloped to office/laboratory space.
|
(2)
|
We expect to provide total estimated costs and related yields in the future, subsequent to the commencement of development or redevelopment.
|
(3)
|
Represents the initial stabilized yields related to the fully occupied operating properties upon closing.
|
(4)
|
The campus includes 10 operating buildings, of which we expect to renovate several vacant suites aggregating 182,056 RSF. We expect to achieve unlevered initial stabilized yields of 6.6% and 6.5% (cash basis) for the operating buildings, and yields for future development will be disclosed subsequent to the commencement of development.
|
(5)
|
Refer to the “New Class A Development and Redevelopment Properties: Summary of Pipeline” subsection of this “Investments in Real Estate” section under this Item 2 for additional information.
|
(6)
|
In December 2018, we acquired two buildings adjacent to our Campus Pointe by Alexandria campus. The total purchase price of $80.0 million was paid in two installments, $15.0 million in December 2018 and $65.0 million in January 2019.
|
|
|
Submarket/Market
|
|
Date of Sale
|
|
Interest Sold
|
|
Square Footage
|
|
Capitalization Rate(1)
|
|
Capitalization Rate
(Cash Basis)(1)
|
|
|
|
|
|
|
Sales Price
Per RSF
|
|
Consideration in Excess of Book Value(2)
|
|||||||||||
Property
|
|
|
|
|
Operating
|
|
Future Development
|
|
|
|
Sales Price
|
|
|
|||||||||||||||||||
Completed disposition and sales of partial interests:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
75/125 Binney Street
|
|
Cambridge/Greater Boston
|
|
2/13/19
|
|
60%
|
|
388,270
|
|
N/A
|
|
4.2%
|
|
4.3%
|
|
$
|
438,000
|
|
|
|
$
|
1,880
|
|
|
$
|
202,246
|
|
|
||||
10260 Campus Point Drive and
4161 Campus Point Court
|
|
University Town Center/San Diego
|
|
7/26/19
|
|
45%
|
|
(3)
|
|
(3)
|
|
(3)
|
|
(3)
|
|
36,000
|
|
|
|
N/A
|
|
|
N/A
|
|
|
|||||||
500 Forbes Boulevard
|
|
South San Francisco/San Francisco
|
|
8/1/19
|
|
90%
|
|
155,685
|
|
N/A
|
|
4.2%
|
|
4.4%
|
|
139,500
|
|
|
|
$
|
996
|
|
|
$
|
48,385
|
|
|
|||||
5200 Illumina Way
|
|
University Town Center/San Diego
|
|
8/21/19
|
|
49%
|
|
792,687
|
|
451,832
|
|
5.7%
|
|
4.7%
|
|
286,747
|
|
|
|
N/A
|
|
|
$
|
131,864
|
|
(4)
|
||||||
6138/6150 Nancy Ridge Drive
|
|
Sorrento Mesa/San Diego
|
|
12/19/19
|
|
100%
|
|
56,698
|
|
N/A
|
|
N/A
|
|
N/A
|
|
6,625
|
|
|
|
$
|
117
|
|
|
N/A
|
|
(5)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
906,872
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Capitalization rates are calculated based upon net operating income and net operating income (cash basis), annualized for the quarter preceding the date on which the property is sold.
|
(2)
|
We retained control over each of these newly formed joint ventures (except as noted in footnote 5) and therefore consolidate these properties. For consolidated joint ventures, we account for the difference between the consideration received and the book value of the interest sold as an equity transaction, with no gain or loss recognized in earnings.
|
(3)
|
In December 2018, we acquired two buildings adjacent to our Campus Pointe by Alexandria campus aggregating 269,048 RSF, comprising 109,164 RSF at 10260 Campus Point Drive and 159,884 RSF at 4161 Campus Point Court, for a total purchase price of $80.0 million. In July 2019, as had been contemplated at the time of the original acquisition, we completed the formation of a joint venture through the sale of a 45% noncontrolling interest to an institutional investor.
|
(4)
|
This transaction values 100% of the campus at $585.2 million and represents a value in excess of book basis aggregating $269.1 million.
|
(5)
|
Upon completion of the sale of 6138/6150 Nancy Ridge Drive, we recognized in earnings a gain on sale of real estate of $474 thousand.
|
(1)
|
Upon completion of 26 projects in process targeting either WELL or Fitwel certification.
|
(2)
|
Relative to a 2015 baseline. Carbon pollution, energy consumption, and water consumption values are for our directly managed buildings.
|
(3)
|
Waste values are for our total portfolio, which includes both indirectly and directly managed buildings.
|
399 Binney Street
|
|
266 and 275 Second Avenue
|
|
1655 and 1725 Third Street
|
|
279 East Grand Avenue
|
|
681 and 685 Gateway Boulevard
|
||||||||||
Greater Boston/Cambridge
|
|
Greater Boston/Route 128
|
|
San Francisco/Mission Bay/SoMa
|
|
San Francisco/South San Francisco
|
|
San Francisco/South San Francisco
|
||||||||||
164,000 RSF
|
|
203,757 RSF
|
|
593,765 RSF
|
|
211,405 RSF
|
|
142,400 RSF
|
||||||||||
98.3% Occupied
|
|
100% Occupied
|
|
100% Occupied
|
|
97.5% Occupied
|
|
100% Occupied
|
||||||||||
|
|
|
|
|
|
|
|
|
Menlo Gateway
|
|
Alexandria PARC
|
|
9880 Campus Point Drive
|
|
188 East Blaine Street
|
|
Alexandria Center® for AgTech, Phase I
|
||||||||||
San Francisco/Greater Stanford
|
|
San Francisco/Greater Stanford
|
|
San Diego/University Town Center
|
|
Seattle/Lake Union
|
|
Research Triangle/Research Triangle
|
||||||||||
772,983 RSF
|
|
197,498 RSF
|
|
98,000 RSF
|
|
201,805 RSF
|
|
180,400 RSF
|
||||||||||
100% Occupied
|
|
96.8% Occupied
|
|
100% Occupied
|
|
98.0% Occupied
|
|
95.3% Occupied
|
||||||||||
|
|
|
|
|
|
|
|
|
Property/Market/Submarket
|
|
Our Ownership Interest
|
|
Dev/Redev
|
|
RSF Placed Into Service
|
|
Occupancy Percentage(1)
|
|
Total Project
|
|
Unlevered Yields
|
|||||||||||||||||||||||||||||
|
|
|
|
|
|
Initial Stabilized
|
|
Initial Stabilized (Cash Basis)
|
|||||||||||||||||||||||||||||||||
|
|
|
1Q19
|
|
2Q19
|
|
3Q19
|
|
4Q19
|
|
Total
|
|
|
RSF
|
|
Investment
|
|
|
|||||||||||||||||||||||
399 Binney Street/Greater Boston/Cambridge
|
|
100%
|
|
Dev
|
|
123,403
|
|
|
—
|
|
|
40,597
|
|
|
—
|
|
|
164,000
|
|
|
|
98.3%
|
|
|
164,000
|
|
|
|
$
|
185,000
|
|
|
|
7.9
|
%
|
|
|
|
7.3
|
%
|
|
266 and 275 Second Avenue/Greater Boston/
Route 128
|
|
100%
|
|
Redev
|
|
—
|
|
|
12,822
|
|
|
—
|
|
|
19,036
|
|
|
31,858
|
|
|
|
100%
|
|
|
203,757
|
|
|
|
$
|
91,000
|
|
|
|
8.5
|
|
|
|
|
7.1
|
|
|
1655 and 1725 Third Street/San Francisco/
Mission Bay/SoMa(2)
|
|
10%
|
|
Dev
|
|
—
|
|
|
—
|
|
|
593,765
|
|
|
—
|
|
|
593,765
|
|
|
|
100%
|
|
|
593,765
|
|
|
|
$
|
77,500
|
|
|
|
7.8
|
|
|
|
|
6.1
|
|
|
279 East Grand Avenue/San Francisco/
South San Francisco
|
|
100%
|
|
Dev
|
|
139,810
|
|
|
24,396
|
|
|
35,797
|
|
|
11,402
|
|
|
211,405
|
|
|
|
97.5%
|
|
|
211,405
|
|
|
|
$
|
145,000
|
|
(3)
|
|
8.4
|
|
(3)
|
|
|
8.6
|
|
(3)
|
681 and 685 Gateway Boulevard/San Francisco/
South San Francisco
|
|
100%
|
|
Redev
|
|
66,000
|
|
|
76,400
|
|
|
—
|
|
|
—
|
|
|
142,400
|
|
|
|
100%
|
(4)
|
|
142,400
|
|
|
|
$
|
116,300
|
|
|
|
8.5
|
|
|
|
|
8.2
|
|
|
Menlo Gateway/San Francisco/Greater Stanford(2)
|
|
49%
|
|
Dev
|
|
—
|
|
|
—
|
|
|
520,988
|
|
|
—
|
|
|
520,988
|
|
|
|
100%
|
|
|
772,983
|
|
|
|
$
|
415,000
|
|
|
|
7.1
|
|
|
|
|
6.4
|
|
|
Alexandria PARC/San Francisco/Greater Stanford
|
|
100%
|
|
Redev
|
|
48,547
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
48,547
|
|
|
|
96.8%
|
|
|
197,498
|
|
|
|
$
|
152,600
|
|
|
|
7.3
|
|
|
|
|
6.2
|
|
|
9880 Campus Point Drive/San Diego/
University Town Center
|
|
100%
|
|
Dev
|
|
—
|
|
|
—
|
|
|
—
|
|
|
36,284
|
|
|
36,284
|
|
|
|
100%
|
|
|
98,000
|
|
|
|
$
|
255,000
|
|
(5)
|
|
6.3
|
|
(5)
|
|
|
6.4
|
|
(5)
|
188 East Blaine Street/Seattle/Lake Union
|
|
100%
|
|
Dev
|
|
90,615
|
|
|
27,164
|
|
|
39,372
|
|
|
44,654
|
|
|
201,805
|
|
|
|
98.0%
|
|
|
201,805
|
|
|
|
$
|
183,000
|
|
|
|
6.7
|
|
|
|
|
6.7
|
|
|
704 Quince Orchard Road/Maryland/Gaithersburg(2)
|
|
56.8%
|
|
Redev
|
|
10,250
|
|
|
3,470
|
|
|
—
|
|
|
—
|
|
|
13,720
|
|
|
|
100%
|
|
|
80,032
|
|
|
|
$
|
13,300
|
|
|
|
8.9
|
|
|
|
|
8.8
|
|
|
Alexandria Center® for AgTech, Phase I/
Research Triangle/Research Triangle
|
|
100%
|
|
Redev
|
|
2,614
|
|
|
73,809
|
|
|
30,900
|
|
|
19,554
|
|
|
126,877
|
|
|
|
95.3%
|
|
|
180,400
|
|
|
|
$
|
88,700
|
|
|
|
7.5
|
|
(6)
|
|
|
7.6
|
|
(6)
|
Total
|
|
|
|
|
|
481,239
|
|
|
218,061
|
|
|
1,261,419
|
|
|
130,930
|
|
|
2,091,649
|
|
|
|
|
|
|
|
|
|
|
|
|
7.4
|
%
|
|
|
|
6.9
|
%
|
|
(1)
|
Relates to total operating RSF placed in service as of the most recent delivery.
|
(2)
|
This property is an unconsolidated real estate joint venture. RSF represents 100% and cost and yields amounts represent our share.
|
(3)
|
Improvements in initial stabilized yields of 60 bps and 50 bps (cash basis), are due to reduction in costs of $6 million primarily from core and shell cost savings.
|
(4)
|
Excludes 685 Gateway Boulevard, a 15,437 RSF amenity building.
|
(5)
|
Project costs represent aggregate development costs for 9880 Campus Point Drive and 4150 Campus Point Court. Yields represent expected aggregate returns for Campus Pointe by Alexandria, including 9880, 10290, and 10300 Campus Point Drive and 4150 Campus Point Court.
|
(6)
|
Yields represent aggregate returns for Alexandria Center® for AgTech – Research Triangle which consists of Phase I at 5 Laboratory Drive and Phase II at 9 Laboratory Drive.
|
The Arsenal on the Charles
|
|
945 Market Street
|
|
201 Haskins Way
|
|
Alexandria District for
Science and Technology
|
|
3160 Porter Drive
|
Greater Boston/
Cambridge/Inner Suburbs
|
|
San Francisco/Mission Bay/SoMa
|
|
San Francisco/South San Francisco
|
|
San Francisco/Greater Stanford
|
|
San Francisco/Greater Stanford
|
153,157 RSF
|
|
255,765 RSF
|
|
315,000 RSF
|
|
526,178 RSF
|
|
92,147 RSF
|
|
|
|
|
|
|
|
|
|
Alexandria Center® –
Long Island City |
|
9880 Campus Point Drive and
4150 Campus Point Court |
|
1165 Eastlake Avenue East
|
|
9800 Medical Center Drive
|
|
9950 Medical Center Drive
|
New York City/New York City
|
|
San Diego/University Town Center
|
|
Seattle/Lake Union
|
|
Maryland/Rockville
|
|
Maryland/Rockville
|
140,098 RSF
|
|
232,818 RSF
|
|
100,086 RSF
|
|
176,832 RSF
|
|
84,264 RSF
|
|
|
|
|
|
|
|
|
|
Property/Market/Submarket
|
|
|
|
Square Footage
|
|
Percentage
|
|
Occupancy(1)
|
|||||||||||||||
|
Dev/Redev
|
|
In Service
|
|
CIP
|
|
Total
|
|
Leased
|
|
Leased/Negotiating
|
|
Initial
|
|
Stabilized
|
||||||||
Developments and redevelopments under construction
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
The Arsenal on the Charles/Greater Boston/Cambridge/Inner Suburbs
|
|
Redev
|
|
683,131
|
|
(2)
|
153,157
|
|
|
836,288
|
|
|
82
|
%
|
|
|
82
|
%
|
|
|
2021
|
|
2022
|
945 Market Street/San Francisco/Mission Bay/SoMa
|
|
Redev
|
|
—
|
|
|
255,765
|
|
|
255,765
|
|
|
—
|
|
|
|
—
|
|
|
|
4Q20
|
|
2021/22
|
201 Haskins Way/San Francisco/South San Francisco
|
|
Dev
|
|
—
|
|
|
315,000
|
|
|
315,000
|
|
|
33
|
|
|
|
33
|
|
|
|
3Q20
|
|
2021
|
Alexandria District for Science and Technology/San Francisco/Greater Stanford
|
|
Dev
|
|
—
|
|
|
526,178
|
|
|
526,178
|
|
|
56
|
|
|
|
65
|
|
|
|
4Q20
|
|
2021
|
3160 Porter Drive/San Francisco/Greater Stanford
|
|
Redev
|
|
—
|
|
|
92,147
|
|
|
92,147
|
|
|
—
|
|
|
|
—
|
|
|
|
4Q20
|
|
2021
|
Alexandria Center® – Long Island City/New York City/New York City
|
|
Redev
|
|
36,661
|
|
|
140,098
|
|
|
176,759
|
|
|
21
|
|
|
|
21
|
|
|
|
3Q20
|
|
2020
|
9880 Campus Point Drive and 4150 Campus Point Court/San Diego/
University Town Center(3)
|
|
Dev
|
|
36,284
|
|
|
232,818
|
|
|
269,102
|
|
|
87
|
|
|
|
89
|
|
|
|
4Q19
|
|
2022
|
1165 Eastlake Avenue East/Seattle/Lake Union
|
|
Dev
|
|
—
|
|
|
100,086
|
|
|
100,086
|
|
|
100
|
|
|
|
100
|
|
|
|
4Q20
|
|
4Q20
|
9800 Medical Center Drive/Maryland/Rockville
|
|
Dev
|
|
—
|
|
|
176,832
|
|
|
176,832
|
|
|
100
|
|
|
|
100
|
|
|
|
3Q20
|
|
3Q20
|
9950 Medical Center Drive/Maryland/Rockville
|
|
Dev
|
|
—
|
|
|
84,264
|
|
|
84,264
|
|
|
100
|
|
|
|
100
|
|
|
|
3Q20
|
|
3Q20
|
704 Quince Orchard Road/Maryland/Gaithersburg(4)
|
|
Redev
|
|
38,934
|
|
|
41,098
|
|
|
80,032
|
|
|
70
|
|
|
|
70
|
|
|
|
4Q18
|
|
2020
|
Total
|
|
|
|
795,010
|
|
|
2,117,443
|
|
|
2,912,453
|
|
|
61
|
%
|
|
|
63
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Initial occupancy dates are subject to leasing and/or market conditions. Multi-tenant projects may have occupancy by tenants over a period of time. Stabilized occupancy may vary depending on single tenancy versus multi-tenancy.
|
(2)
|
We expect to redevelop 154,855 RSF of occupied space into office/laboratory space upon expiration of the existing leases in the third quarter of 2020 and first quarter of 2021.
|
(3)
|
Refer to footnote 2 on the next page.
|
(4)
|
704 Quince Orchard is an unconsolidated real estate joint venture. RSF represent 100%.
|
|
|
Our Ownership Interest
|
|
|
|
|
|
|
|
|
|
|
Unlevered Yields
|
||||||||||||||||
Property/Market/Submarket
|
|
|
In Service
|
|
CIP
|
|
Cost to Complete
|
|
Total at
Completion
|
|
Initial Stabilized
|
|
Initial Stabilized (Cash Basis)
|
||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||||||
Developments and redevelopments under construction
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
The Arsenal on the Charles/Greater Boston/Cambridge/Inner Suburbs
|
|
100
|
%
|
|
|
$
|
440,047
|
|
|
$
|
62,561
|
|
|
TBD
|
|||||||||||||||
945 Market Street/San Francisco/Mission Bay/SoMa
|
|
99.5
|
%
|
|
|
—
|
|
|
191,424
|
|
|
||||||||||||||||||
201 Haskins Way/San Francisco/South San Francisco
|
|
100
|
%
|
|
|
—
|
|
|
152,333
|
|
|
143,667
|
|
|
296,000
|
|
|
|
|
6.6
|
%
|
|
|
|
6.6
|
%
|
|
||
Alexandria District for Science and Technology/San Francisco/Greater Stanford
|
|
100
|
%
|
|
|
—
|
|
|
278,448
|
|
|
298,552
|
|
|
577,000
|
|
|
|
|
6.5
|
%
|
|
|
|
6.2
|
%
|
|
||
3160 Porter Drive/San Francisco/Greater Stanford
|
|
100
|
%
|
|
|
—
|
|
|
28,759
|
|
|
TBD
|
|||||||||||||||||
Alexandria Center® – Long Island City/New York City/New York City
|
|
100
|
%
|
|
|
16,159
|
|
|
72,962
|
|
|
95,179
|
|
|
184,300
|
|
|
|
|
5.5
|
%
|
|
|
|
5.6
|
%
|
|
||
9880 Campus Point Drive and 4150 Campus Point Court/San Diego/
University Town Center(1)
|
|
(1
|
)
|
|
|
40,397
|
|
|
90,301
|
|
|
124,302
|
|
|
255,000
|
|
|
|
|
6.3
|
%
|
(2)
|
|
|
6.4
|
%
|
(2)
|
||
1165 Eastlake Avenue East/Seattle/Lake Union
|
|
100
|
%
|
|
|
—
|
|
|
53,931
|
|
|
84,069
|
|
|
138,000
|
|
|
|
|
6.5
|
%
|
(3)
|
|
|
6.3
|
%
|
(3)
|
||
9800 Medical Center Drive/Maryland/Rockville
|
|
100
|
%
|
|
|
—
|
|
|
33,159
|
|
|
62,241
|
|
|
95,400
|
|
|
|
|
7.7
|
%
|
|
|
|
7.2
|
%
|
|
||
9950 Medical Center Drive/Maryland/Rockville
|
|
100
|
%
|
|
|
—
|
|
|
27,129
|
|
|
27,171
|
|
|
54,300
|
|
|
|
|
7.3
|
%
|
|
|
|
6.8
|
%
|
|
||
Consolidated projects
|
|
|
|
|
496,603
|
|
|
991,007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
704 Quince Orchard Road/Maryland/Gaithersburg(4)
|
|
56.8
|
%
|
|
|
4,400
|
|
|
5,574
|
|
|
3,326
|
|
|
13,300
|
|
|
|
|
8.9
|
%
|
|
|
|
8.8
|
%
|
|
||
Total
|
|
|
|
|
$
|
501,003
|
|
|
$
|
996,581
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Refer to the “Consolidated and Unconsolidated Real Estate Joint Ventures” section under this Item 2 for additional information.
|
(2)
|
Represents a two-phase development project as follows:
|
•
|
Initial phase represents 9880 Campus Point Drive, a 98,000 RSF project to develop Alexandria GradLabs™, a highly flexible, first-of-its-kind life science platform designed to provide post-seed-stage life science companies with turnkey, fully furnished office/laboratory suites and an accelerated, scalable path for growth. The R&D building located at 9880 Campus Point Drive was demolished and as of December 31, 2019, continues to be included in our same property performance results. Refer to the “Same Properties” subsection of the “Results of Operations” section under this Item 2 for additional information.
|
•
|
Subsequent phase represents 4150 Campus Point Court, a 171,102 RSF, 100% leased project with occupancy expected in 2022.
|
•
|
Project costs represent development costs for 9880 Campus Point Drive and 4150 Campus Point Court. Unlevered yields represent expected aggregate returns for Campus Pointe by Alexandria, including 9880, 10290, and 10300 Campus Point Drive and 4150 Campus Point Court.
|
(3)
|
Unlevered yields represent anticipated aggregate returns for 1165 Eastlake Avenue, an amenity-rich research headquarter for Adaptive Biotechnologies Corporation, and 1208 Eastlake Avenue, an adjacent multi-tenant office/laboratory building.
|
(4)
|
704 Quince Orchard is an unconsolidated real estate joint venture. Cost and yields amounts represent our share.
|
Property/Submarket
|
|
Our Ownership Interest
|
|
Book Value
|
|
Square Footage
|
|
|||||||||||||||||
|
|
|
Development and Redevelopment
|
|
Total
|
|
||||||||||||||||||
|
|
|
Under Construction
|
|
Near-Term
|
|
Intermediate-Term
|
|
Future
|
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Maryland
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
704 Quince Orchard Road/Gaithersburg
|
|
56.8
|
%
|
|
|
$
|
—
|
|
(1)
|
41,098
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41,098
|
|
|
9800 Medical Center Drive/Rockville
|
|
100
|
%
|
|
|
34,390
|
|
|
176,832
|
|
|
—
|
|
|
—
|
|
|
64,000
|
|
|
240,832
|
|
|
|
9950 Medical Center Drive/Rockville
|
|
100
|
%
|
|
|
27,129
|
|
|
84,264
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
84,264
|
|
|
|
14200 Shady Grove Road/Rockville
|
|
100
|
%
|
|
|
25,902
|
|
|
—
|
|
|
—
|
|
|
290,000
|
|
|
145,000
|
|
|
435,000
|
|
|
|
|
|
|
|
|
87,421
|
|
|
302,194
|
|
|
—
|
|
|
290,000
|
|
|
209,000
|
|
|
801,194
|
|
|
||
Research Triangle
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Alexandria Center® for AgTech, Phase II/Research Triangle
|
|
100
|
%
|
|
|
10,464
|
|
|
—
|
|
|
160,000
|
|
|
—
|
|
|
—
|
|
|
160,000
|
|
|
|
8 Davis Drive/Research Triangle
|
|
100
|
%
|
|
|
4,751
|
|
|
—
|
|
|
150,000
|
|
|
70,000
|
|
|
—
|
|
|
220,000
|
|
|
|
6 Davis Drive/Research Triangle
|
|
100
|
%
|
|
|
15,688
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
800,000
|
|
|
800,000
|
|
|
|
Other value-creation projects
|
|
100
|
%
|
|
|
4,150
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
76,262
|
|
|
76,262
|
|
|
|
|
|
|
|
|
35,053
|
|
|
—
|
|
|
310,000
|
|
|
70,000
|
|
|
876,262
|
|
|
1,256,262
|
|
|
||
Other value-creation projects
|
|
100
|
%
|
|
|
3,842
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
122,800
|
|
|
122,800
|
|
|
|
Total
|
|
|
|
|
2,239,830
|
|
|
2,117,443
|
|
|
2,127,925
|
|
|
4,884,067
|
|
|
4,585,477
|
|
|
13,714,912
|
|
(2)
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Pending acquisition/San Francisco
|
|
(3
|
)
|
|
|
(3)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
700,000
|
|
|
700,000
|
|
|
|
Mercer Mega Block/Lake Union
|
|
(3
|
)
|
|
|
(3)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
800,000
|
|
|
800,000
|
|
|
|
Key 2020 pending acquisitions
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,500,000
|
|
|
1,500,000
|
|
|
||
|
|
|
|
|
$
|
2,239,830
|
|
|
2,117,443
|
|
|
2,127,925
|
|
|
4,884,067
|
|
|
6,085,477
|
|
|
15,214,912
|
|
|
(1)
|
This property is held by an unconsolidated real estate joint venture. Refer to the “Consolidated and Unconsolidated Real Estate Joint Ventures” section under Item 7 in this annual report on Form 10-K for additional information on our ownership interest.
|
(2)
|
Total rentable square footage includes 1,525,116 RSF of buildings currently in operation that will be redeveloped or replaced with new development RSF upon commencement of future construction. Refer to the definition of “Investments in Real Estate – Value-Creation Square Footage Currently in Rental Properties” in the “Non-GAAP Measures and Definitions” section under Item 7 in this annual report on Form 10-K for additional information.
|
(3)
|
Refer to the “Acquisitions” subsection of this “Investments in Real Estate” section under this Item 2 for additional information.
|
|
|
Year Ended
|
|
||
Construction Spending
|
|
December 31, 2019
|
|
||
Additions to real estate – consolidated projects
|
|
$
|
1,224,541
|
|
|
Investments in unconsolidated real estate joint ventures
|
|
102,081
|
|
|
|
Contributions from noncontrolling interests
|
|
(9,156
|
)
|
|
|
Construction spending (cash basis)(1)
|
|
1,317,466
|
|
|
|
Change in accrued construction
|
|
(24
|
)
|
|
|
Construction spending
|
|
$
|
1,317,442
|
|
|
(1)
|
Includes revenue-enhancing projects and non-revenue-enhancing capital expenditures.
|
|
|
|
|
Year Ending
|
|
|||||
Projected Construction Spending
|
|
December 31, 2020
|
|
|||||||
Development, redevelopment, and pre-construction projects
|
|
$
|
1,414,000
|
|
|
|||||
Contributions from noncontrolling interests (consolidated real estate joint ventures)
|
|
|
(24,000
|
)
|
|
|||||
Generic laboratory infrastructure
|
|
|
166,000
|
|
|
|||||
Non-revenue-enhancing capital expenditures
|
|
|
44,000
|
|
|
|||||
Guidance midpoint
|
|
|
1,600,000
|
|
|
|||||
Guidance range
|
|
$
|
1,550,000
|
|
–
|
1,650,000
|
|
|
Non-Revenue-Enhancing Capital Expenditures(1)
|
|
Year Ended December 31, 2019
|
|
Recent Average
Per RSF(2) |
||||||||
|
Amount
|
|
Per RSF
|
|
||||||||
Building improvements
|
|
$
|
11,453
|
|
|
$
|
0.47
|
|
|
$
|
0.50
|
|
|
|
|
|
|
|
|
||||||
Tenant improvements and leasing costs:
|
|
|
|
|
|
|
||||||
Re-tenanted space
|
|
$
|
32,912
|
|
|
$
|
28.20
|
|
|
$
|
22.74
|
|
Renewal space
|
|
16,310
|
|
|
12.95
|
|
|
13.43
|
|
|||
Total tenant improvements and leasing costs/weighted average
|
|
$
|
49,222
|
|
|
$
|
20.28
|
|
|
$
|
17.15
|
|
(1)
|
Excludes amounts that are recoverable from tenants, related to revenue-enhancing capital expenditures, or related to properties that have undergone redevelopment.
|
(2)
|
Represents the average for a five-year period from 2015 to 2019.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
(In thousands, except per share amounts)
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from rentals
|
|
$
|
1,516,864
|
|
|
$
|
1,314,781
|
|
|
$
|
1,122,325
|
|
|
$
|
897,475
|
|
|
$
|
817,887
|
|
Other income
|
|
14,432
|
|
|
12,678
|
|
|
5,772
|
|
|
24,231
|
|
|
25,587
|
|
|||||
Total revenues
|
|
1,531,296
|
|
|
1,327,459
|
|
|
1,128,097
|
|
|
921,706
|
|
|
843,474
|
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental operations
|
|
445,492
|
|
|
381,120
|
|
|
325,609
|
|
|
278,408
|
|
|
261,232
|
|
|||||
General and administrative
|
|
108,823
|
|
|
90,405
|
|
|
75,009
|
|
|
63,884
|
|
|
59,621
|
|
|||||
Interest
|
|
173,675
|
|
|
157,495
|
|
|
128,645
|
|
|
106,953
|
|
|
105,813
|
|
|||||
Depreciation and amortization
|
|
544,612
|
|
|
477,661
|
|
|
416,783
|
|
|
313,390
|
|
|
261,289
|
|
|||||
Impairment of real estate
|
|
12,334
|
|
|
6,311
|
|
|
203
|
|
|
209,261
|
|
|
23,250
|
|
|||||
Loss on early extinguishment of debt
|
|
47,570
|
|
|
1,122
|
|
|
3,451
|
|
|
3,230
|
|
|
189
|
|
|||||
Total expenses
|
|
1,332,506
|
|
|
1,114,114
|
|
|
949,700
|
|
|
975,126
|
|
|
711,394
|
|
|||||
Equity in earnings (losses) of unconsolidated real estate JVs
|
|
10,136
|
|
|
43,981
|
|
|
15,426
|
|
|
(184
|
)
|
|
1,651
|
|
|||||
Investment income
|
|
194,647
|
|
|
136,763
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Gain on sales of real estate – rental properties
|
|
474
|
|
|
8,704
|
|
|
270
|
|
|
3,715
|
|
|
12,426
|
|
|||||
Income (loss) from continuing operations
|
|
404,047
|
|
|
402,793
|
|
|
194,093
|
|
|
(49,889
|
)
|
|
146,157
|
|
|||||
(Loss) income from discontinued operations(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(43
|
)
|
|||||
Gain on sales of real estate – land parcels
|
|
—
|
|
|
—
|
|
|
111
|
|
|
90
|
|
|
—
|
|
|||||
Net income (loss)
|
|
404,047
|
|
|
402,793
|
|
|
194,204
|
|
|
(49,799
|
)
|
|
146,114
|
|
|||||
Net income attributable to noncontrolling interests
|
|
(40,882
|
)
|
|
(23,481
|
)
|
|
(25,111
|
)
|
|
(16,102
|
)
|
|
(1,897
|
)
|
|||||
Net income (loss) attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
|
363,165
|
|
|
379,312
|
|
|
169,093
|
|
|
(65,901
|
)
|
|
144,217
|
|
|||||
Dividends on preferred stock
|
|
(3,204
|
)
|
|
(5,060
|
)
|
|
(7,666
|
)
|
|
(20,223
|
)
|
|
(24,986
|
)
|
|||||
Preferred stock redemption charge
|
|
(2,580
|
)
|
|
(4,240
|
)
|
|
(11,279
|
)
|
|
(61,267
|
)
|
|
—
|
|
|||||
Net income attributable to unvested restricted stock awards
|
|
(6,386
|
)
|
|
(6,029
|
)
|
|
(4,753
|
)
|
|
(3,750
|
)
|
|
(2,364
|
)
|
|||||
Net income (loss) attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
|
$
|
350,995
|
|
|
$
|
363,983
|
|
|
$
|
145,395
|
|
|
$
|
(151,141
|
)
|
|
$
|
116,867
|
|
Net income (loss) per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders – basic
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
|
$
|
3.13
|
|
|
$
|
3.53
|
|
|
$
|
1.59
|
|
|
$
|
(1.99
|
)
|
|
$
|
1.63
|
|
Discontinued operations(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income (loss) per share
|
|
$
|
3.13
|
|
|
$
|
3.53
|
|
|
$
|
1.59
|
|
|
$
|
(1.99
|
)
|
|
$
|
1.63
|
|
Net income (loss) per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders – diluted
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
|
$
|
3.12
|
|
|
$
|
3.52
|
|
|
$
|
1.58
|
|
|
$
|
(1.99
|
)
|
|
$
|
1.63
|
|
Discontinued operations(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income (loss) per share
|
|
$
|
3.12
|
|
|
$
|
3.52
|
|
|
$
|
1.58
|
|
|
$
|
(1.99
|
)
|
|
$
|
1.63
|
|
Weighted-average shares of common stock outstanding – basic
|
|
112,204
|
|
|
103,010
|
|
|
91,546
|
|
|
76,103
|
|
|
71,529
|
|
|||||
Weighted-average shares of common stock outstanding – diluted
|
|
112,524
|
|
|
103,321
|
|
|
92,063
|
|
|
76,103
|
|
|
71,529
|
|
|||||
Dividends declared per share of common stock
|
|
$
|
4.00
|
|
|
$
|
3.73
|
|
|
$
|
3.45
|
|
|
$
|
3.23
|
|
|
$
|
3.05
|
|
Balance Sheet Data (at year end):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments in real estate
|
|
$
|
14,844,038
|
|
|
$
|
11,913,693
|
|
|
$
|
10,298,019
|
|
|
$
|
9,077,972
|
|
|
$
|
7,629,922
|
|
Total assets
|
|
$
|
18,390,503
|
|
|
$
|
14,464,956
|
|
|
$
|
12,103,953
|
|
|
$
|
10,354,888
|
|
|
$
|
8,881,017
|
|
Total debt
|
|
$
|
6,777,479
|
|
|
$
|
5,478,255
|
|
|
$
|
4,764,807
|
|
|
$
|
4,164,025
|
|
|
$
|
3,935,692
|
|
Total liabilities
|
|
$
|
8,224,025
|
|
|
$
|
6,570,242
|
|
|
$
|
5,620,784
|
|
|
$
|
4,972,610
|
|
|
$
|
4,587,053
|
|
Redeemable noncontrolling interests
|
|
$
|
12,300
|
|
|
$
|
10,786
|
|
|
$
|
11,509
|
|
|
$
|
11,307
|
|
|
$
|
14,218
|
|
Total equity
|
|
$
|
10,154,178
|
|
|
$
|
7,883,928
|
|
|
$
|
6,471,660
|
|
|
$
|
5,370,971
|
|
|
$
|
4,279,746
|
|
(1)
|
Refer to Note 2 – “Summary of Significant Accounting Policies” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for additional information on discontinued operations.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
(Dollars in thousands, except per occupied RSF amounts)
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Other Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by operating activities
|
|
$
|
683,857
|
|
|
$
|
570,339
|
|
|
$
|
450,882
|
|
|
$
|
393,487
|
|
|
$
|
342,551
|
|
Net cash used in investing activities
|
|
$
|
3,641,320
|
|
|
$
|
2,161,760
|
|
|
$
|
1,737,126
|
|
|
$
|
1,498,406
|
|
|
$
|
716,505
|
|
Net cash provided by financing activities
|
|
$
|
2,927,482
|
|
|
$
|
1,588,433
|
|
|
$
|
1,420,341
|
|
|
$
|
1,093,775
|
|
|
$
|
415,284
|
|
Number of properties – North America
|
|
291
|
|
|
237
|
|
|
213
|
|
|
199
|
|
|
191
|
|
|||||
RSF – North America (including development and redevelopment projects under construction)
|
|
29,098,433
|
|
24,587,438
|
|
21,981,133
|
|
19,869,729
|
|
18,874,070
|
||||||||||
Occupancy of operating properties – North America
|
|
96.8%
|
|
97.3%
|
|
96.8%
|
|
96.6%
|
|
97.2%
|
||||||||||
Occupancy of operating and redevelopment properties – North America
|
|
94.4%
|
|
95.1%
|
|
94.7%
|
|
95.7%
|
|
93.7%
|
||||||||||
Annual rental revenue per occupied RSF – North America
|
|
$
|
51.04
|
|
|
$
|
48.42
|
|
|
$
|
48.01
|
|
|
$
|
45.15
|
|
|
$
|
41.17
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reconciliation of net income (loss) attributable to Alexandria’s common stockholders to funds from operations attributable to Alexandria’s common stockholders – diluted:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
|
$
|
350,995
|
|
|
$
|
363,983
|
|
|
$
|
145,395
|
|
|
$
|
(151,141
|
)
|
|
$
|
116,867
|
|
Depreciation and amortization of real estate assets
|
|
541,855
|
|
|
477,661
|
|
|
416,783
|
|
|
313,390
|
|
|
261,289
|
|
|||||
Noncontrolling share of depreciation and amortization from consolidated real estate JVs
|
|
(30,960
|
)
|
|
(16,077
|
)
|
|
(14,762
|
)
|
|
(9,349
|
)
|
|
(372
|
)
|
|||||
Our share of depreciation and amortization from unconsolidated real estate JVs(1)
|
|
6,366
|
|
|
3,181
|
|
|
1,551
|
|
|
2,707
|
|
|
1,734
|
|
|||||
Gain on sales of real estate – rental properties
|
|
(474
|
)
|
|
(8,704
|
)
|
|
(270
|
)
|
|
(3,715
|
)
|
|
(12,426
|
)
|
|||||
Our share of gain on sales of real estate from unconsolidated real estate JVs(1)
|
|
—
|
|
|
(35,678
|
)
|
|
(14,106
|
)
|
|
—
|
|
|
—
|
|
|||||
Gain on sales of real estate – land parcels
|
|
—
|
|
|
—
|
|
|
(111
|
)
|
|
(90
|
)
|
|
—
|
|
|||||
Impairment of real estate – rental properties
|
|
12,334
|
|
|
—
|
|
|
203
|
|
|
98,194
|
|
|
23,250
|
|
|||||
Assumed conversion of 7.00% Series D cumulative convertible preferred stock(2)
|
|
3,204
|
|
|
5,060
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Allocation to unvested restricted stock awards
|
|
(5,904
|
)
|
|
(5,961
|
)
|
|
(2,920
|
)
|
|
—
|
|
|
(1,758
|
)
|
|||||
Funds from operations attributable to Alexandria’s common stockholders – diluted(3)
|
|
877,416
|
|
|
783,465
|
|
|
531,763
|
|
|
249,996
|
|
|
388,584
|
|
|||||
Unrealized gains on non-real estate investments
|
|
(161,489
|
)
|
|
(99,634
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Realized gains on non-real estate investments
|
|
—
|
|
|
(14,680
|
)
|
|
—
|
|
|
(4,361
|
)
|
|
(13,109
|
)
|
|||||
Impairment of real estate – land parcels
|
|
—
|
|
|
6,311
|
|
|
—
|
|
|
110,474
|
|
|
—
|
|
|||||
Impairment of non-real estate investments
|
|
17,124
|
|
|
5,483
|
|
|
8,296
|
|
|
3,065
|
|
|
—
|
|
|||||
Loss on early extinguishment of debt
|
|
47,570
|
|
|
1,122
|
|
|
3,451
|
|
|
3,230
|
|
|
189
|
|
|||||
Loss on early termination of interest rate hedge agreements
|
|
1,702
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Our share of gain on early extinguishment of debt from unconsolidated real estate JVs(1)
|
|
—
|
|
|
(761
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Preferred stock redemption charge
|
|
2,580
|
|
|
4,240
|
|
|
11,279
|
|
|
61,267
|
|
|
—
|
|
|||||
Removal of assumed conversion of 7.00% Series D cumulative convertible preferred stock(2)
|
|
(3,204
|
)
|
|
(5,060
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Allocation to unvested restricted stock awards
|
|
1,307
|
|
|
1,517
|
|
|
(321
|
)
|
|
(2,356
|
)
|
|
110
|
|
|||||
Funds from operations attributable to Alexandria’s common stockholders – diluted, as adjusted(3)
|
|
$
|
783,006
|
|
|
$
|
682,003
|
|
|
$
|
554,468
|
|
|
$
|
421,315
|
|
|
$
|
375,774
|
|
(1)
|
Classified in equity in earnings of unconsolidated real estate joint ventures in our consolidated statements of operations under Item 15 in this annual report on Form 10-K.
|
(2)
|
Refer to “Weighted-Average Share of Common Stock Outstanding – Diluted” in the “Non-GAAP Measures and Definitions” section under Item 7 in this annual report on Form 10-K for additional information.
|
(3)
|
Refer to “Funds From Operations and Funds From Operations, as Adjusted, Attributable to Alexandria Real Estate Equities, Inc.’s Common Stockholders” in the “Non-GAAP Measures and Definitions” section under Item 7 in this annual report on Form 10-K.
|
|
|
Year Ended December 31,
|
|
||||||
|
|
2019
|
|
2018
|
|
||||
Net income attributable to Alexandria’s common stockholders – diluted:
|
|
|
|
|
|
||||
In millions
|
|
$
|
351.0
|
|
|
$
|
364.0
|
|
|
Per share
|
|
$
|
3.12
|
|
|
$
|
3.52
|
|
|
Funds from operations attributable to Alexandria’s common stockholders –
diluted, as adjusted:
|
|
|
|
||||||
In millions
|
|
$
|
783.0
|
|
|
$
|
682.0
|
|
|
Per share
|
|
$
|
6.96
|
|
|
$
|
6.60
|
|
|
•
|
50% of annual rental revenue from investment-grade or publicly traded large cap tenants.
|
•
|
Weighted-average remaining lease term of 8.1 years.
|
•
|
Total revenues of $1.5 billion, up 15.4%, for the year ended December 31, 2019, compared to $1.3 billion for the year ended December 31, 2018.
|
•
|
Continued strong internal growth; acquired vacancy from recent acquisitions provide opportunity to increase income from rentals and net operating income.
|
•
|
Net operating income (cash basis) of $951.8 million for the year ended December 31, 2019, increased by $121.2 million, or 14.6%, compared to the year ended December 31, 2018.
|
•
|
Same property net operating income growth of 3.1% and 7.1% (cash basis) for the year ended December 31, 2019, compared to the year ended December 31, 2018.
|
•
|
Continued strong leasing activity during 2019, representing the highest leasing activity in our history and rental rate growth over expiring rates on renewed and re-leased space during 2019, representing our highest annual rental rate increases during the past 10 years:
|
|
|
2019
|
|
Total leasing activity – RSF
|
|
5,062,722
|
|
Lease renewals and re-leasing of space:
|
|
|
|
RSF (included in total leasing activity above)
|
|
2,427,108
|
|
Rental rate increases
|
|
32.2%
|
|
Rental rate increases (cash basis)
|
|
17.6%
|
|
|
|
|
•
|
Since the beginning of 2019, we have placed into service 2.1 million RSF of development and redevelopment projects, with weighted-average initial stabilized yields of 7.4% and 6.9% (cash basis).
|
•
|
Significant near-term growth of annual net operating income (cash basis), including our share of unconsolidated real estate joint ventures, of $55 million upon the burn-off of initial free rent on recently delivered projects.
|
•
|
We commenced development and redevelopment projects aggregating 1.9 million RSF during the year ended December 31, 2019.
|
•
|
During the year ended December 31, 2019, we leased 1.4 million RSF of development and redevelopment space.
|
Percentage of annual rental revenue in effect from:
|
|
|
|
|
Investment-grade or publicly traded large cap tenants
|
|
|
50
|
|
Class A properties in AAA locations
|
|
|
76
|
|
Occupancy of operating properties in North America
|
|
|
96.8
|
(1)
|
Operating margin(2)
|
|
|
70
|
|
Adjusted EBITDA margin(2)
|
|
|
68
|
(3)
|
Weighted-average remaining lease term:
|
|
|
|
|
All tenants
|
|
|
8.1
|
years
|
Top 20 tenants
|
|
|
11.6
|
years
|
|
|
|
|
|
(1)
|
Includes 259,616 RSF, or 1.0%, of vacancy representing lease-up opportunities at properties recently acquired during the second half of 2019, primarily related to our SD Tech by Alexandria campus. Excluding these vacancies, occupancy of operating properties in North America would have been 97.8% as of December 31, 2019. Refer to the “Summary of Occupancy Percentages in North America” section under Item 2 in this annual report on Form 10-K for additional information.
|
(2)
|
Fourth quarter of 2019, annualized.
|
(3)
|
Represents an increase of 400 bps since the beginning of 2013.
|
•
|
In February 2019, it was announced that we are working with Verily Life Sciences, LLC, Alphabet’s life science division, to build a tech-focused rehabilitation campus in Dayton, Ohio, for the full and sustained recovery of people living with opioid addiction. The campus will provide a comprehensive model of care that will include a behavioral health treatment center, rehabilitation housing, and wrap-around services, and will act as a state of the art model for opioid addiction treatment nationwide.
|
•
|
In February 2019, we were recognized by the Center for Active Design, which operates Fitwel®, as the inaugural Industry Leading Company in Fitwel’s 2018 Best in Building Health. We were selected based on our 3-Star Fitwel certification (the highest rating possible); our leadership in promoting and educating the real estate industry on the opportunities for and benefits of building design, construction, and operational practices that support high levels of occupant health and wellness; and our #1 global ranking in the 2018 GRESB Health & Well-Being Module.
|
•
|
In March 2019, Alexandria LaunchLabs® – Cambridge, located at the Alexandria Center® at One Kendall Square in Greater Boston, achieved LEED gold certification and a Fitwel 3-Star certification.
|
•
|
In April 2019, we announced the launch of a new strategic agricultural technology (agtech) business initiative and the opening of Phase I of the Alexandria Center® for AgTech – Research Triangle, the first and only fully integrated, amenity-rich, multi-tenant agtech R&D and greenhouse campus, in the heart of Research Triangle, the most important, dense, and diverse agtech cluster in the U.S. The campus opened with a 97% leased, 180,400 RSF first phase redevelopment at 5 Laboratory Drive.
|
•
|
In June 2019, we announced our partnership with Columbia University to open our second Alexandria LaunchLabs® in New York City in the spring of 2020. The full-service platform will offer member companies 13,298 RSF of highly flexible, turnkey office/laboratory space and feature a high-tech event center to host workshops, networking events, and educational opportunities for the entrepreneurial life science community.
|
•
|
In June 2019, we celebrated the opening of the first facilities within the tech-focused opioid rehabilitation campus in Dayton, Ohio. In partnership with Verily Life Sciences, LLC, we are leading the design and development of this 59,000 RSF state-of-the-art campus to provide a comprehensive model of care dedicated to the recovery of people suffering from opioid addiction.
|
•
|
In September 2019, we achieved the following in the 2019 GRESB Real Estate Assessment: (i) GRESB 5 Star Rating (out of 5 stars), (ii) our third consecutive “Green Star” designation, and (iii) our second consecutive “A” disclosure score.
|
•
|
In October 2019, we accepted the 2019 Developer of the Year Award from NAIOP, the Commercial Real Estate Development Association. This award annually honors the development company that best exemplifies leadership and innovation as demonstrated by the outstanding quality of projects and services, financial consistency and stability, ability to adapt to market conditions, and support for the local community.
|
•
|
In November 2019, Alexandria, in collaboration with academic institutions, research hospitals, and life science industry partners, including Harvard University, the Massachusetts Institute of Technology, FUJIFILM Diosynth Biotechnologies, and GE Healthcare Life Sciences, announced the launch of a first-of-its-kind consortium to catalyze advanced biological innovation and manufacturing in Greater Boston with an aim to treat, prevent, and cure diseases.
|
•
|
In January 2020, we announced our first national $100,000 AgTech Innovation Prize competition to recognize startup and early-stage agtech and foodtech companies that demonstrate novel approaches to addressing agriculture-, food-, and nutrition-related challenges.
|
•
|
In January 2020, Alexandria Venture Investments, the company’s venture capital arm, was recognized for a third consecutive year as the most active biopharma investor by new deal volume by Silicon Valley Bank in its “2020 Annual Report: Healthcare Investments and Exits.” Alexandria’s venture activity provides us with, among other things, mission-critical data and knowledge on innovations and trends.
|
•
|
Our philanthropy and volunteerism efforts provide mission-critical support to non-profit organizations doing meaningful work in areas of medical research, STEM education, military support services, and serving local communities. During 2019, our team members volunteered more than 4,500 hours to support over 250 non-profit organizations across the country.
|
•
|
We value both the health and wellness of our team members as well as supporting organizations on the leading edge of medical innovation. In November 2019, we were honored to support 59 of our team members who completed the 2019 New York City Marathon on behalf of Fred’s Team and raised approximately $360 thousand to support the mission-critical research at Memorial Sloan Kettering Cancer Center.
|
•
|
As of the date of this report, we completed acquisitions of four properties in 2020 for an aggregate purchase price of $341.2 million, comprising 800,346 RSF of operating and redevelopment opportunities strategically located across multiple markets.
|
•
|
In January 2020, we formed a real estate joint venture with Boston Properties, Inc., in which we are targeting a 51% ownership interest over time. We are the managing member with the power to direct the activities that most significantly affect the economic performance of the joint venture, and will consolidate this joint venture pursuant to the applicable accounting standards. Our partner contributed three office buildings and land supporting 260,000 square feet of future development, and we contributed one office building, one office/laboratory building, one amenity building, at 701, 681, and 685 Gateway Boulevard, respectively, and land supporting 377,000 square feet of future development. This future mega campus in our South San Francisco submarket will aggregate 1.7 million RSF, approximately 50% of which represents future development and redevelopment opportunities.
|
•
|
In January 2020, we entered into forward equity sales agreements to sell an aggregate of 6.9 million shares of our common stock (including the exercise of an underwriters’ option) at a public offering price of $155.00 per share, before underwriting discounts. We expect to settle these forward equity sales agreements in 2020, and receive proceeds of approximately $1.0 billion, to be further adjusted as provided in the sales agreements, which will fund pending and recently completed acquisitions and the construction of our highly leased development projects.
|
•
|
We expect to file a new ATM program in the first quarter of 2020.
|
Same Property Net Operating
Income Growth
|
|
Favorable Lease Structure(1)
|
|||||||
|
|
|
Strategic Lease Structure by Owner and Operator of Collaborative Life Science, Technology, and AgTech Campuses
|
||||||
|
Increasing cash flows
|
|
|
||||||
|
Percentage of leases containing annual rent escalations
|
95%
|
|||||||
|
Stable cash flows
|
|
|
||||||
|
Percentage of triple
net leases
|
97%
|
|||||||
|
Lower capex burden
|
|
|
||||||
|
Percentage of leases providing for the recapture of capital expenditures
|
96%
|
|||||||
|
|
|
|||||||
|
|
|
|
||||||
Rental Rate Growth:
Renewed/Re-Leased Space |
|
Margins(2)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
Operating
|
|
|
|
Adjusted EBITDA
|
||||
|
70%
|
|
|
|
68%
|
||||
|
|
|
|||||||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
(1)
|
Percentages calculated based on RSF as of December 31, 2019.
|
(2)
|
Represents percentages for the three months ended December 31, 2019.
|
•
|
$26.3 billion of total market capitalization
|
•
|
$19.5 billion of total equity capitalization
|
•
|
$2.4 billion of liquidity(1)
|
(1)
|
In January 2020, we entered into $1.0 billion of forward equity sales agreements. Including the outstanding forward equity agreements, we had proforma liquidity of $3.4 billion.
|
|
|
As of December 31, 2019
|
|
Goal for Fourth Quarter of 2020, Annualized
|
|||
|
|
Quarter Annualized
|
|
Trailing 12 Months
|
|
||
Net debt and preferred stock to Adjusted EBITDA
|
|
5.7x
|
(1)
|
|
6.1x
|
|
Less than or equal to 5.2x
|
Fixed-charge coverage ratio
|
|
4.2x
|
|
|
4.2x
|
|
Greater than 4.5x
|
|
|
|
|
|
|
|
|
(1)
|
Due to the timing of two acquisitions that closed in December 2019, we had a temporary 0.4x increase above our projected net debt and preferred stock to Adjusted EBITDA – fourth quarter of 2019, annualized, for December 31, 2019. We remain committed to our guidance of net debt and preferred stock to Adjusted EBITDA – fourth quarter of 2020, annualized, of less than or equal to 5.2x.
|
Value-creation pipeline of new Class A development and redevelopment projects as a percentage of gross investments in real estate
|
|
As of
December 31, 2019
|
Under construction and 63% leased/negotiating
|
|
6%
|
Income-producing/potential cash flows/covered land play(1)
|
|
5%
|
Land
|
|
2%
|
|
|
|
(1)
|
Includes projects that have existing buildings which are generating or can generate operating cash flows. Also includes development rights associated with existing operating campuses.
|
•
|
We had the following dispositions and sales of partial interests in core Class A properties (dollars in millions, except per RSF):
|
|
|
|
|
Interest Sold
|
|
Sales Price
|
|
Capitalization Rate (Cash)
|
||||||||||||
Property
|
|
Submarket
|
|
RSF
|
|
|
Total
|
|
Per RSF
|
|
||||||||||
5200 Illumina Way
|
|
University Town Center
|
|
792,687
|
|
|
49%
|
|
$
|
286.7
|
|
|
N/A
|
|
(1)
|
4.7
|
%
|
|
||
75/125 Binney Street
|
|
Cambridge
|
|
388,270
|
|
|
60%
|
|
438.0
|
|
|
$
|
1,880
|
|
|
4.3
|
%
|
|
||
500 Forbes Boulevard
|
|
South San Francisco
|
|
155,685
|
|
|
90%
|
|
139.5
|
|
|
$
|
996
|
|
|
|
4.4
|
%
|
|
|
10260 Campus Point Drive and 4161 Campus Point Court
|
|
University Town Center
|
|
269,048
|
|
|
45%
|
|
36.0
|
|
|
N/A
|
|
|
|
N/A
|
|
|
||
6138/6150 Nancy Ridge Drive
|
|
Sorrento Mesa
|
|
56,698
|
|
|
100%
|
|
6.6
|
|
|
$
|
117
|
|
|
|
N/A
|
|
|
|
|
|
|
|
1,662,388
|
|
|
|
|
$
|
906.8
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
(1) Represents $264.6 million, or $681 per RSF, for the operating buildings and $22.1 million, or $100 per RSF, for the developable land parcel. This transaction values 100% of the campus at $585.2 million and represents a value in excess of book basis aggregating $269.1 million.
|
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
Our issuances and repayments of debt included the following (dollars in millions):
|
|
Date
|
|
Effective Interest Rate
|
|
Maturity Date
|
|
Principal Amount
|
|
Loss on Early Extinguishment of Debt
|
|||||
Issuances
|
|
|
|
|
|
|
|
|
|
|||||
Unsecured senior notes payable – green bond
|
March
|
|
4.03
|
%
|
|
1/15/24
|
|
$
|
200
|
|
|
|
||
Unsecured senior notes payable – green bond
|
March
|
|
3.96
|
|
|
4/15/26
|
|
350
|
|
|
|
|||
Unsecured senior notes payable
|
March
|
|
4.93
|
|
|
4/15/49
|
|
300
|
|
|
|
|||
Unsecured senior notes payable
|
July
|
|
3.48
|
|
|
8/15/31
|
|
750
|
|
|
|
|||
Unsecured senior notes payable
|
July/Sept
|
|
3.91
|
|
|
2/1/50
|
|
700
|
|
|
|
|||
Unsecured senior notes payable
|
Sept
|
|
2.87
|
|
|
12/15/29
|
|
400
|
|
|
|
|||
Weighted average/total
|
|
|
3.77
|
%
|
|
16.9 years
|
|
$
|
2,700
|
|
(1)
|
|
||
|
|
|
|
|
|
|
|
|
|
|||||
Repayments of debt
|
|
|
|
|
|
|
|
|
|
|||||
Secured notes payable
|
Jan
|
|
8.15
|
%
|
|
4/1/20
|
|
$
|
107
|
|
|
$
|
7.1
|
|
Secured construction loan
|
March
|
|
3.29
|
|
|
1/28/20
|
|
193
|
|
|
0.3
|
|
||
Unsecured senior notes payable
|
July/Aug
|
|
2.96
|
|
|
1/15/20
|
|
400
|
|
|
37.4
|
|
||
Unsecured senior notes payable
|
July/Aug
|
|
4.75
|
|
|
4/1/22
|
|
550
|
|
|
||||
Unsecured senior bank term loan
|
July/Sept
|
|
3.62
|
|
|
1/2/25
|
|
350
|
|
|
2.8
|
|
||
Weighted average/total
|
|
|
4.11
|
%
|
|
2.4 years
|
|
$
|
1,600
|
|
(1)
|
$
|
47.6
|
|
(1)
|
The remaining proceeds received from our debt issuances, after repayments of debt, were used to fund the construction of our value-creation pipeline and acquisitions completed during 2019. Refer to Note 3 – “Investments in Real Estate” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for additional information.
|
•
|
In conjunction with the $350.0 million repayment of our unsecured senior bank term loan, during the three months ended September 30, 2019, we also terminated all of our interest rate hedge agreements aggregating $350.0 million with a weighted-average interest pay rate of 2.57% and reclassified the entire loss on our interest rate hedge agreements aggregating $1.7 million from accumulated other comprehensive loss into interest expense in our consolidated statements of operations.
|
•
|
In September 2019, we established a commercial paper program with the ability to issue up to $750.0 million of commercial paper notes with a maximum maturity of 397 days from the date of issue. Our commercial paper program is backed by our $2.2 billion unsecured senior line of credit, and at all times we expect to retain a minimum undrawn amount of borrowing capacity under our unsecured senior line of credit equal to any outstanding balance on our commercial paper program. We use borrowings under the program to fund short-term capital needs. As of December 31, 2019, we had no borrowings outstanding under our commercial paper program.
|
•
|
During the year ended December 31, 2019, we issued 8.7 million shares of common stock and received net proceeds of $1.2 billion, as follows:
|
•
|
Issued an aggregate of 8.1 million shares of common stock, at a weighted-average price of $139.32 per share, for aggregate proceeds (net of underwriters’ discounts) of approximately $1.1 billion. During the year ended December 31, 2019, we incurred initial issuance costs aggregating $700 thousand in connection with these forward equity sales agreements.
|
•
|
Issued 602,484 shares of common stock under our ATM program, at a weighted-average price of $145.58 per share, for net proceeds of $86.1 million, during the three months ended June 30, 2019. As of December 31, 2019, we had approximately $22.5 million of gross proceeds available to be issued under our ATM program.
|
•
|
The proceeds were used to fund construction projects and 2019 acquisitions completed prior to December 2019.
|
•
|
During the year ended December 31, 2019, we repurchased, in privately negotiated transactions, 275,000 outstanding shares of our Series D Convertible Preferred Stock at an aggregate price of $9.2 million, or $33.60 per share, and recognized a preferred stock redemption charge of $2.6 million.
|
•
|
In September 2019, we elected to convert the remaining 2.3 million outstanding shares of our Series D Convertible Preferred Stock into shares of our common stock. The Series D Convertible Preferred Stock became eligible for mandatory conversion at our discretion, at a set conversion rate of 0.2513 shares of common stock to one share of preferred stock, upon our common stock price exceeding $149.46 per share for the specified period of time required to cause the mandatory conversion. In October 2019, we converted the Series D Convertible Preferred Stock into 578 thousand shares of common stock. This conversion was accounted for as an equity transaction, and we did not recognize a gain or loss. As of December 31, 2019, we had no outstanding shares of Series D Convertible Preferred Stock.
|
•
|
Allocate capital to Class A properties located in collaborative life science, technology, and agtech campuses in AAA urban innovation clusters;
|
•
|
Continue to improve our credit profile;
|
•
|
Maintain prudent access to diverse sources of capital, which include cash flows from operating activities after dividends, incremental debt supported by our growth in EBITDA, real estate asset sales, non-real estate investment sales, joint venture capital, and other capital such as sales of equity;
|
•
|
Maintain commitment to long-term capital to fund growth;
|
•
|
Prudently ladder debt maturities;
|
•
|
Reduce short-term variable-rate debt;
|
•
|
Prudently manage equity investments to support corporate-level investment strategies;
|
•
|
Maintain significant balance sheet liquidity; and
|
•
|
Maintain a stable and flexible balance sheet.
|
|
|
December 31, 2019
|
|
|
|
||||||||||
(In thousands)
|
|
Three Months Ended
|
|
Year Ended
|
|
Year Ended December 31, 2018
|
|||||||||
Realized gains
|
|
$
|
4,399
|
|
(1)
|
|
$
|
33,158
|
|
(1)
|
|
$
|
37,129
|
|
(2)
|
Unrealized gains
|
|
148,268
|
|
|
|
161,489
|
|
|
|
99,634
|
|
|
|||
Investment income
|
|
$
|
152,667
|
|
|
|
$
|
194,647
|
|
|
|
$
|
136,763
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments
|
|
Cost
|
|
Adjustments
|
|
Carrying Amount
|
|||||||||
Fair value:
|
|
|
|
|
|
|
|
|
|
||||||
Publicly traded companies
|
|
$
|
148,109
|
|
|
|
$
|
170,528
|
|
(3)
|
|
$
|
318,637
|
|
|
Entities that report NAV
|
|
271,276
|
|
|
|
162,626
|
|
|
|
433,902
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Entities that do not report NAV:
|
|
|
|
|
|
|
|
|
|
||||||
Entities with observable price changes since 1/1/18
|
|
42,045
|
|
|
|
68,489
|
|
|
|
110,534
|
|
|
|||
Entities without observable price changes
|
|
277,521
|
|
|
|
—
|
|
|
|
277,521
|
|
|
|||
December 31, 2019
|
|
$
|
738,951
|
|
|
|
$
|
401,643
|
|
|
|
$
|
1,140,594
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
September 30, 2019
|
|
$
|
737,078
|
|
|
|
$
|
253,376
|
|
|
|
$
|
990,454
|
|
|
(1)
|
Includes realized gains for the three months and year ended December 31, 2019, of $14.4 million and $50.3 million, respectively, and impairments related to non-real estate investments in privately held entities of $10.0 million and $17.1 million, respectively.
|
(2)
|
Includes realized gains of $14.7 million related to two publicly traded non-real estate investments and impairment of $5.5 million primarily related to one non-real estate investment in a privately held entity. Excluding these gains and impairment, our realized gains on non-real estate investments were $27.9 million for the year ended December 31, 2018.
|
(3)
|
Includes gross unrealized gains and losses of $197.3 million and $26.8 million, respectively.
|
|
Public/Private
Mix (Cost) |
|
|
|
|
|
|
|
|
Tenant/Non-Tenant
Mix (Cost) |
|
|
|
|
|
Year Ended December 31,
|
||||||||||||||
(In millions, except per share amounts)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Amount
|
|
Per Share – Diluted
|
|||||||||||||
Gains on non-real estate investments(1):
|
|
|
|
|
|
|
|
||||||||
Unrealized
|
$
|
161.5
|
|
|
$
|
99.6
|
|
|
$
|
1.44
|
|
|
$
|
0.96
|
|
Realized
|
—
|
|
|
14.7
|
|
|
—
|
|
|
0.14
|
|
||||
Gain on sales of real estate
|
0.5
|
|
|
44.4
|
|
|
—
|
|
|
0.43
|
|
||||
Impairment of:
|
|
|
|
|
|
|
|
||||||||
Real estate(2)
|
(12.3
|
)
|
|
(6.3
|
)
|
|
(0.11
|
)
|
|
(0.06
|
)
|
||||
Non-real estate investments(1)
|
(17.1
|
)
|
|
(5.5
|
)
|
|
(0.15
|
)
|
|
(0.05
|
)
|
||||
Early extinguishment of debt:
|
|
|
|
|
|
|
|
||||||||
Loss(3)
|
(47.6
|
)
|
|
(1.1
|
)
|
|
(0.42
|
)
|
|
(0.01
|
)
|
||||
Our share of gain
|
—
|
|
|
0.8
|
|
|
—
|
|
|
0.01
|
|
||||
Loss on early termination of interest rate hedge agreements
|
(1.7
|
)
|
|
—
|
|
|
(0.02
|
)
|
|
—
|
|
||||
Preferred stock redemption charge(4)
|
(2.6
|
)
|
|
(4.2
|
)
|
|
(0.02
|
)
|
|
(0.04
|
)
|
||||
Allocation to unvested restricted stock awards
|
—
|
|
|
(2.2
|
)
|
|
—
|
|
|
(0.02
|
)
|
||||
Total
|
$
|
80.7
|
|
|
$
|
140.2
|
|
|
$
|
0.72
|
|
|
$
|
1.36
|
|
Weighted-average shares of common stock outstanding for calculation of
EPS – diluted
|
|
|
|
|
112.5
|
|
|
103.3
|
|
(1)
|
Refer to Note 7 – “Investments” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for more information.
|
(2)
|
Refer to Note 3 – “Investments in Real Estate” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for more information.
|
(3)
|
Refer to Note 10 – “Secured and Unsecured Senior Debt” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for more information.
|
(4)
|
Refer to Note 16 – “Stockholders’ Equity” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for more information.
|
|
|
December 31,
|
||||
|
|
2019
|
|
2018
|
||
Percentage change in net operating income over comparable period from prior year
|
|
3.1%
|
|
|
3.7
|
%
|
Percentage change in net operating income (cash basis) over comparable period from prior year
|
|
7.1%
|
|
|
9.2
|
%
|
Operating margin
|
|
71%
|
|
|
71%
|
|
Number of Same Properties
|
|
192
|
|
|
185
|
|
RSF
|
|
18,519,783
|
|
17,221,297
|
||
Occupancy – current-period average
|
|
96.6%
|
|
96.6
|
%
|
|
Occupancy – same-period prior-year average
|
|
96.3%
|
|
96.1
|
%
|
Development – under construction
|
|
Properties
|
|
|
9800 Medical Center Drive
|
|
1
|
|
|
9950 Medical Center Drive
|
|
1
|
|
|
Alexandria District for Science and Technology
|
|
2
|
|
|
201 Haskins Way
|
|
1
|
|
|
1165 Eastlake Avenue East
|
|
1
|
|
|
4150 Campus Point Court
|
|
1
|
|
|
|
|
7
|
|
|
Development – placed into service after January 1, 2018
|
|
Properties
|
|
|
100 Binney Street
|
|
1
|
|
|
399 Binney Street
|
|
1
|
|
|
213 East Grand Avenue
|
|
1
|
|
|
279 East Grand Avenue
|
|
1
|
|
|
188 East Blaine Street
|
|
1
|
|
|
|
|
5
|
|
|
Redevelopment – under construction
|
|
Properties
|
|
|
Alexandria Center® – Long Island City
|
|
1
|
|
|
945 Market Street
|
|
1
|
|
|
3160 Porter Drive
|
|
1
|
|
|
The Arsenal on the Charles
|
|
4
|
|
|
|
|
7
|
|
|
Redevelopment – placed into service after January 1, 2018
|
|
Properties
|
|
|
9625 Towne Centre Drive
|
|
1
|
|
|
Alexandria PARC
|
|
4
|
|
|
681 and 685 Gateway Boulevard
|
|
2
|
|
|
9900 Medical Center Drive
|
|
1
|
|
|
266 and 275 Second Avenue
|
|
2
|
|
|
Alexandria Center® for AgTech, Phase I
|
|
1
|
|
|
|
|
11
|
|
|
|
|
|
|
Acquisitions after January 1, 2018
|
|
Properties
|
|
|
100 Tech Drive
|
|
1
|
|
|
219 East 42nd Street
|
|
1
|
|
|
Summers Ridge Science Park
|
|
4
|
|
|
2301 5th Avenue
|
|
1
|
|
|
9704, 9708, 9712, and 9714 Medical Center Drive
|
|
4
|
|
|
9920 Belward Campus Drive
|
|
1
|
|
|
21 Firstfield Road
|
|
1
|
|
|
25, 35, 45, 50, and 55 West Watkins Mill Road
|
|
5
|
|
|
10260 Campus Point Drive and 4161 Campus Point Court
|
|
2
|
|
|
3170 Porter Drive
|
|
1
|
|
|
Shoreway Science Center
|
|
2
|
|
|
3911, 3931, and 4075 Sorrento Valley Boulevard
|
|
3
|
|
|
260 Townsend Street
|
|
1
|
|
|
5 Necco Street
|
|
1
|
|
|
601 Dexter Avenue North
|
|
1
|
|
|
4224/4242 Campus Point Court and 10210 Campus Point Drive
|
|
3
|
|
|
3825 and 3875 Fabian Way
|
|
2
|
|
|
SD Tech by Alexandria
|
|
10
|
|
|
The Arsenal on the Charles
|
|
7
|
|
|
Other
|
|
9
|
|
|
|
|
60
|
|
|
|
|
|
|
|
Unconsolidated real estate JV
|
|
6
|
|
|
Properties held for sale
|
|
3
|
|
|
Total properties excluded from Same Properties
|
|
99
|
|
|
Same Properties
|
|
192
|
|
(1)
|
Total properties in North America as of December 31, 2019
|
|
291
|
|
|
|
|
(1)
|
Includes 9880 Campus Point Drive and 3545 Cray Court. The 9880 Campus Point Drive building was occupied through January 2018 and is currently in active development, and 3545 Cray Court is currently undergoing renovations.
|
|
|
Year Ended December 31,
|
|
|||||||||||||
(Dollars in thousands)
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
|||||||
Income from rentals:
|
|
|
|
|
|
|
|
|
|
|||||||
Same Properties
|
|
$
|
927,077
|
|
|
$
|
897,522
|
|
|
$
|
29,555
|
|
|
3.3
|
%
|
|
Non-Same Properties
|
|
238,711
|
|
|
113,196
|
|
|
125,515
|
|
|
110.9
|
|
|
|||
Rental revenues
|
|
1,165,788
|
|
|
1,010,718
|
|
|
155,070
|
|
|
15.3
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
Same Properties
|
|
299,325
|
|
|
281,092
|
|
|
18,233
|
|
|
6.5
|
|
|
|||
Non-Same Properties
|
|
51,751
|
|
|
22,971
|
|
|
28,780
|
|
|
125.3
|
|
|
|||
Tenant recoveries
|
|
351,076
|
|
|
304,063
|
|
|
47,013
|
|
|
15.5
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
Income from rentals
|
|
1,516,864
|
|
|
1,314,781
|
|
|
202,083
|
|
|
15.4
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
Same Properties
|
|
448
|
|
|
298
|
|
|
150
|
|
|
50.3
|
|
|
|||
Non-Same Properties
|
|
13,984
|
|
|
12,380
|
|
|
1,604
|
|
|
13.0
|
|
|
|||
Other income
|
|
14,432
|
|
|
12,678
|
|
|
1,754
|
|
|
13.8
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
Same Properties
|
|
1,226,850
|
|
|
1,178,912
|
|
|
47,938
|
|
|
4.1
|
|
|
|||
Non-Same Properties
|
|
304,446
|
|
|
148,547
|
|
|
155,899
|
|
|
104.9
|
|
|
|||
Total revenues
|
|
1,531,296
|
|
|
1,327,459
|
|
|
203,837
|
|
|
15.4
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
Same Properties
|
|
353,431
|
|
|
332,051
|
|
|
21,380
|
|
|
6.4
|
|
|
|||
Non-Same Properties
|
|
92,061
|
|
|
49,069
|
|
|
42,992
|
|
|
87.6
|
|
|
|||
Rental operations
|
|
445,492
|
|
|
381,120
|
|
|
64,372
|
|
|
16.9
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
Same Properties
|
|
873,419
|
|
|
846,861
|
|
|
26,558
|
|
|
3.1
|
|
|
|||
Non-Same Properties
|
|
212,385
|
|
|
99,478
|
|
|
112,907
|
|
|
113.5
|
|
|
|||
Net operating income
|
|
$
|
1,085,804
|
|
|
$
|
946,339
|
|
|
$
|
139,465
|
|
|
14.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net operating income – Same Properties
|
|
$
|
873,419
|
|
|
$
|
846,861
|
|
|
$
|
26,558
|
|
|
3.1
|
%
|
|
Straight-line rent revenue
|
|
(55,393
|
)
|
|
(79,475
|
)
|
|
24,082
|
|
|
(30.3
|
)
|
|
|||
Amortization of acquired below-market leases
|
|
(7,249
|
)
|
|
(10,196
|
)
|
|
2,947
|
|
|
(28.9
|
)
|
|
|||
Net operating income – Same Properties (cash basis)
|
|
$
|
810,777
|
|
|
$
|
757,190
|
|
|
$
|
53,587
|
|
|
7.1
|
%
|
|
|
|
Year Ended December 31,
|
|
|
||||||||
Component
|
|
2019
|
|
2018
|
|
Change
|
||||||
Interest incurred
|
|
$
|
262,238
|
|
|
$
|
223,715
|
|
|
$
|
38,523
|
|
Capitalized interest
|
|
(88,563
|
)
|
|
(66,220
|
)
|
|
(22,343
|
)
|
|||
Interest expense
|
|
$
|
173,675
|
|
|
$
|
157,495
|
|
|
$
|
16,180
|
|
|
|
|
|
|
|
|
||||||
Average debt balance outstanding(1)
|
|
$
|
6,416,773
|
|
|
$
|
5,513,958
|
|
|
$
|
902,815
|
|
Weighted-average annual interest rate(2)
|
|
4.1
|
%
|
|
4.1
|
%
|
|
—
|
%
|
(1)
|
Represents the average debt balance outstanding during the respective periods.
|
(2)
|
Represents total interest incurred divided by the average debt balance outstanding in the respective periods.
|
Component
|
|
Interest Rate(1)
|
|
Effective Date
|
|
Change
|
|
|||||
Increases in interest incurred due to:
|
|
|
|
|
|
|
|
|
|
|||
Issuances of debt:
|
|
|
|
|
|
|
|
|
|
|||
$650 million unsecured senior notes payable – green bond
|
|
|
4.03
|
%
|
|
|
June 2018/
March 2019 |
|
$
|
13,857
|
|
|
$750 million unsecured senior notes payable
|
|
|
3.48
|
%
|
|
|
July 2019
|
|
11,708
|
|
|
|
$300 million unsecured senior notes payable
|
|
|
4.93
|
%
|
|
|
March 2019
|
|
11,323
|
|
|
|
$700 million unsecured senior notes payable
|
|
|
3.91
|
%
|
|
|
July/September 2019
|
|
11,108
|
|
|
|
$350 million unsecured senior notes payable – green bond
|
|
|
3.96
|
%
|
|
|
March 2019
|
|
10,386
|
|
|
|
$450 million unsecured senior notes payable
|
|
|
4.81
|
%
|
|
|
June 2018
|
|
10,003
|
|
|
|
$400 million unsecured senior notes payable
|
|
|
2.87
|
%
|
|
|
September 2019
|
|
3,349
|
|
|
|
Fluctuations in interest rate and average balance:
|
|
|
|
|
|
|
|
|
|
|||
Commercial paper program
|
|
|
|
|
|
|
|
2,937
|
|
|
||
Reclassification of losses related to termination of interest rate hedge agreements
|
|
|
|
|
|
|
|
1,702
|
|
(2)
|
||
Higher rates for interest rate hedge agreements in effect
|
|
|
|
|
|
|
|
3,134
|
|
|
||
Total increases
|
|
|
|
|
|
|
|
79,507
|
|
|
||
Decreases in interest incurred due to:
|
|
|
|
|
|
|
|
|
|
|||
Repayments of debt:
|
|
|
|
|
|
|
|
|
|
|||
$550 million unsecured senior notes payable
|
|
|
4.75
|
%
|
|
|
July/August 2019
|
|
(10,931
|
)
|
|
|
$400 million unsecured senior notes payable
|
|
|
2.96
|
%
|
|
|
July/August 2019
|
|
(4,905
|
)
|
|
|
Secured construction loan
|
|
|
3.29
|
%
|
|
|
March 2019
|
|
(7,288
|
)
|
|
|
Secured notes payable
|
|
|
8.15
|
%
|
|
|
January 2019
|
|
(8,337
|
)
|
|
|
Unsecured senior bank term loans
|
|
|
Various
|
|
|
|
Various
|
|
(8,057
|
)
|
|
|
Fluctuations in interest rate and average balance:
|
|
|
|
|
|
|
|
|
|
|||
Unsecured senior line of credit
|
|
|
|
|
|
|
|
(1,007
|
)
|
|
||
Other decrease in interest
|
|
|
|
|
|
|
|
(459
|
)
|
|
||
Total decreases
|
|
|
|
|
|
|
|
(40,984
|
)
|
|
||
Change in interest incurred
|
|
|
|
|
|
|
|
38,523
|
|
|
||
Increase in capitalized interest
|
|
|
|
|
|
|
|
(22,343
|
)
|
|
||
Total change in interest expense
|
|
|
|
|
|
|
|
$
|
16,180
|
|
|
(1)
|
Represents the weighted-average interest rate as of the end of the applicable period, including amortization of loan fees, amortization of debt premiums (discounts), and other bank fees.
|
(2)
|
During the year ended December 31, 2019, we terminated all of our interest rate hedge agreements aggregating $350.0 million and reclassified a loss of $1.7 million from accumulated other comprehensive loss into interest expense. Refer to Note 11 – “Interest Rate Hedge Agreements” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for additional information.
|
|
|
Guidance
|
||
Summary of Key Changes in Guidance
|
|
As of 2/3/20
|
|
As of 1/6/20
|
Occupancy percentage in North America as of December 31, 2020(1)
|
|
95.4% to 96.0%
|
|
95.7% to 96.3%
|
(1)
|
The 0.3% reduction in occupancy guidance is attributable to vacancy aggregating 71,016 RSF representing lease-up opportunities at one acquisition completed in January 2020. Refer to the “Summary of Occupancy Percentages in North America” section under Item 2 in this annual report on Form 10-K for additional information.
|
(2)
|
Excludes unrealized gains or losses after December 31, 2019, that are required to be recognized in earnings and are excluded from funds from operations per share, as adjusted.
|
(3)
|
Calculated in accordance with standards established by the Advisory Board of Governors of Nareit (the “Nareit Board of Governors”). Refer to the definition of “Funds From Operations and Funds From Operations, As Adjusted, Attributable to Alexandria’s Common Stockholders” in the “Non-GAAP Measures and Definitions” section under this Item 7 in this annual report on Form 10-K for additional information.
|
Key Assumptions(1)
(Dollars in millions)
|
|
2020 Guidance
|
|||||||
|
Low
|
|
High
|
||||||
Occupancy percentage for operating properties in North America as of December 31, 2020(2)
|
|
95.4%
|
|
|
96.0%
|
|
|
||
|
|
|
|
|
|
||||
Lease renewals and re-leasing of space:
|
|
|
|
|
|
||||
Rental rate increases
|
|
28.0%
|
|
|
31.0%
|
|
|
||
Rental rate increases (cash basis)
|
|
14.0%
|
|
|
17.0%
|
|
|
||
|
|
|
|
|
|
||||
Same property performance:
|
|
|
|
|
|
||||
Net operating income increase
|
|
1.5%
|
|
|
3.5%
|
|
|
||
Net operating income increase (cash basis)
|
|
5.0%
|
|
|
7.0%
|
|
|
||
|
|
|
|
|
|
||||
Straight-line rent revenue
|
|
$
|
113
|
|
|
$
|
123
|
|
|
General and administrative expenses
|
|
$
|
121
|
|
|
$
|
126
|
|
|
Capitalization of interest
|
|
$
|
108
|
|
|
$
|
118
|
|
|
Interest expense
|
|
$
|
169
|
|
|
$
|
179
|
|
|
|
|
|
|
|
|
(1)
|
The completion of our development and redevelopment projects will result in an increase in interest expense and other project costs, because these project costs will no longer qualify for capitalization and will therefore be expensed as incurred. Our key assumptions, included in the tables above, and are subject to a number of variables and uncertainties, including those discussed under Item 1A and this Item 7 in this annual report on Form 10-K. To the extent our full-year earnings guidance is updated during the year, we will provide additional disclosure supporting reasons for any significant changes to such guidance.
|
(2)
|
The 0.3% reduction in occupancy guidance is attributable to vacancy aggregating 71,016 RSF representing lease-up opportunities at one acquisition completed in January 2020. Refer to the “Summary of Occupancy Percentages in North America” section under Item 2 in this annual report on Form 10-K for additional information.
|
Key Credit Metrics
|
|
2020 Guidance
|
|
Net debt and preferred stock to Adjusted EBITDA – fourth quarter of 2020, annualized
|
|
Less than or equal to 5.2x
|
|
Fixed-charge coverage ratio – fourth quarter of 2020, annualized
|
|
Greater than 4.5x
|
|
|
|
|
|
Consolidated Real Estate Joint Ventures
|
|
|
||||
Property/Market/Submarket
|
|
Noncontrolling(1)
Interest Share
|
|
|||
225 Binney Street/Greater Boston/Cambridge
|
|
|
70.0
|
%
|
|
|
75/125 Binney Street/Greater Boston/Cambridge
|
|
|
60.0
|
%
|
|
|
409 and 499 Illinois Street/San Francisco/Mission Bay/SoMa
|
|
|
40.0
|
%
|
|
|
1500 Owens Street/San Francisco/Mission Bay/SoMa
|
|
|
49.9
|
%
|
|
|
500 Forbes Boulevard/San Francisco/South San Francisco
|
|
|
90.0
|
%
|
|
|
Campus Pointe by Alexandria/San Diego/University Town Center(2)
|
|
|
45.0
|
%
|
|
|
5200 Illumina Way/San Diego/University Town Center
|
|
|
49.0
|
%
|
|
|
9625 Towne Centre Drive/San Diego/University Town Center
|
|
|
49.9
|
%
|
|
|
SD Tech by Alexandria/San Diego/Sorrento Mesa
|
|
|
50.0
|
%
|
|
|
|
|
|
|
|
|
|
Unconsolidated Real Estate Joint Ventures
|
|
|
||||
Property/Market/Submarket
|
|
Our Ownership Share(3)
|
|
|||
1655 and 1725 Third Street/San Francisco/Mission Bay/SoMa
|
|
|
10.0
|
%
|
|
|
Menlo Gateway/San Francisco/Greater Stanford
|
|
|
49.0
|
%
|
|
|
1401/1413 Research Boulevard/Maryland/Rockville
|
|
|
65.0
|
%
|
(4)
|
|
704 Quince Orchard Road/Maryland/Gaithersburg
|
|
|
56.8
|
%
|
(4)
|
|
(1)
|
In addition to the consolidated real estate joint ventures listed, various partners hold insignificant noncontrolling interests in six other joint ventures in North America.
|
(2)
|
Excludes 9880 Campus Point Drive in our University Town Center submarket.
|
(3)
|
In addition to the unconsolidated real estate joint ventures listed, we hold an interest in one other insignificant unconsolidated real estate joint venture in North America.
|
(4)
|
Represents our ownership interest; our voting interest is limited to 50%.
|
|
|
|
|
Maturity Date
|
|
Stated Interest Rate
|
|
Interest Rate(1)
|
|
100% at Joint Venture Level
|
|
||||||||
Unconsolidated Joint Venture
|
|
Our Share
|
|
|
|
|
Debt Balance(2)
|
|
Remaining Commitments
|
|
|||||||||
1401/1413 Research Boulevard
|
|
65.0%
|
|
|
5/17/20
|
|
|
L+2.50%
|
|
5.18%
|
|
$
|
26,158
|
|
|
$
|
2,619
|
|
|
1655 and 1725 Third Street(3)
|
|
10.0%
|
|
|
6/29/21
|
|
|
L+3.70%
|
|
5.41%
|
|
309,275
|
|
|
65,725
|
|
|
||
704 Quince Orchard Road
|
|
56.8%
|
|
|
3/16/23
|
|
|
L+1.95%
|
|
3.94%
|
|
9,172
|
|
|
5,709
|
|
|
||
Menlo Gateway, Phase II
|
|
49.0%
|
|
|
5/1/35
|
|
|
4.53%
|
|
4.59%
|
|
56,321
|
|
|
99,529
|
|
|
||
Menlo Gateway, Phase I
|
|
49.0%
|
|
|
8/10/35
|
|
|
4.15%
|
|
4.18%
|
|
142,101
|
|
|
—
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
$
|
543,027
|
|
|
$
|
173,582
|
|
|
(1)
|
Includes interest expense and amortization of loan fees.
|
(2)
|
Represents outstanding principal, net of unamortized deferred financing costs, as of December 31, 2019.
|
(3)
|
This unconsolidated joint venture is in the process of refinancing this loan to, among other changes, extend the maturity date and fix the interest rate. We expect to complete the refinancing next quarter.
|
|
Noncontrolling Interest Share of Consolidated Real Estate Joint Ventures
|
|
Our Share of Unconsolidated
Real Estate Joint Ventures |
||||||||||||
|
December 31, 2019
|
|
December 31, 2019
|
||||||||||||
|
Three Months Ended
|
|
Year Ended
|
|
Three Months Ended
|
|
Year Ended
|
||||||||
Total revenues
|
$
|
32,629
|
|
|
$
|
97,989
|
|
|
$
|
10,388
|
|
|
$
|
22,710
|
|
Rental operations
|
(8,935
|
)
|
|
(26,675
|
)
|
|
(1,174
|
)
|
|
(3,070
|
)
|
||||
|
23,694
|
|
|
71,314
|
|
|
9,214
|
|
|
19,640
|
|
||||
General and administrative
|
(127
|
)
|
|
(347
|
)
|
|
(67
|
)
|
|
(158
|
)
|
||||
Interest
|
—
|
|
|
—
|
|
|
(1,668
|
)
|
|
(2,980
|
)
|
||||
Depreciation and amortization
|
(10,176
|
)
|
|
(30,960
|
)
|
|
(2,702
|
)
|
|
(6,366
|
)
|
||||
Fixed returns allocated to redeemable noncontrolling interests(1)
|
221
|
|
|
875
|
|
|
—
|
|
|
—
|
|
||||
|
$
|
13,612
|
|
|
$
|
40,882
|
|
|
$
|
4,777
|
|
|
$
|
10,136
|
|
|
|
|
|
|
|
|
|
||||||||
Straight-line rent and below-market lease revenue
|
$
|
1,948
|
|
|
$
|
5,347
|
|
|
$
|
5,843
|
|
|
$
|
10,172
|
|
Funds from operations(2)
|
$
|
23,788
|
|
|
$
|
71,842
|
|
|
$
|
7,479
|
|
|
$
|
16,502
|
|
(1)
|
Represents an allocation of joint venture earnings to redeemable noncontrolling interests primarily in one property in our South San Francisco submarket. These redeemable noncontrolling interests earn a fixed return on their investment rather than participate in the operating results of the property.
|
(2)
|
Refer to the definition of “Funds From Operations and Funds From Operations, As Adjusted, Attributable to Alexandria’s Common Stockholders” in the “Non-GAAP Measures and Definitions” section under this Item 7 for the definition and the reconciliation from the most directly comparable GAAP measure.
|
|
December 31, 2019
|
|
||||||
|
Noncontrolling Interest Share of Consolidated Real Estate Joint Ventures
|
|
Our Share of Unconsolidated
Real Estate Joint Ventures |
|
||||
Investments in real estate
|
$
|
1,186,585
|
|
|
$
|
466,334
|
|
|
Cash, cash equivalents, and restricted cash
|
40,128
|
|
|
7,865
|
|
|
||
Other assets
|
142,669
|
|
|
41,741
|
|
|
||
Secured notes payable
|
—
|
|
|
(149,240
|
)
|
|
||
Other liabilities
|
(68,730
|
)
|
|
(19,810
|
)
|
|
||
Redeemable noncontrolling interests
|
(12,300
|
)
|
|
—
|
|
|
||
|
$
|
1,288,352
|
|
|
$
|
346,890
|
|
|
(1)
|
Quarter annualized.
|
(2)
|
Due to the timing of two acquisitions that closed in December 2019, we had a temporary 0.4x increase above our target for December 31, 2019 in our net debt and preferred stock to Adjusted EBITDA – fourth quarter of 2019, annualized. We remain committed to our guidance for net debt and preferred stock to Adjusted EBITDA – fourth quarter of 2020, annualized, of less than or equal to 5.2x.
|
(3)
|
As of December 31, 2019.
|
(4)
|
In January 2020, we entered into $1.0 billion of forward equity sales agreements. Including the outstanding forward equity agreements, we had proforma liquidity of $3.4 billion.
|
•
|
Retain positive cash flows from operating activities after payment of dividends and distributions to noncontrolling interests for investment in development and redevelopment projects and/or acquisitions;
|
•
|
Improve credit profile and relative long-term cost of capital;
|
•
|
Maintain diverse sources of capital, including sources from net cash provided by operating activities, unsecured debt, secured debt, selective real estate asset sales, partial interest sales, non-real estate investment sales, preferred stock, and common stock;
|
•
|
Maintain commitment to long-term capital to fund growth;
|
•
|
Maintain prudent laddering of debt maturities;
|
•
|
Maintain solid credit metrics;
|
•
|
Maintain significant balance sheet liquidity;
|
•
|
Mitigate 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 common stock dividends and distributions to noncontrolling interests 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; and
|
•
|
Maintain high levels of pre-leasing and percentage leased in value-creation projects.
|
Description
|
|
Stated
Rate
|
|
Aggregate
Commitments
|
|
Outstanding
Balance
|
|
Remaining Commitments/Liquidity
|
||||||
Availability under our unsecured senior line of credit
|
|
L+0.825%
|
|
$
|
2,200,000
|
|
|
$
|
384,000
|
|
|
$
|
1,816,000
|
|
Cash, cash equivalents, and restricted cash
|
|
|
|
|
|
|
|
242,689
|
|
|||||
Investments in publicly traded companies
|
|
|
|
|
|
|
|
318,637
|
|
|||||
Total liquidity
|
|
|
|
|
|
|
|
$
|
2,377,326
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
||||||
Net cash provided by operating activities
|
$
|
683,857
|
|
|
$
|
570,339
|
|
|
$
|
113,518
|
|
Net cash used in investing activities
|
$
|
(3,641,320
|
)
|
|
$
|
(2,161,760
|
)
|
|
$
|
(1,479,560
|
)
|
Net cash provided by financing activities
|
$
|
2,927,482
|
|
|
$
|
1,588,433
|
|
|
$
|
1,339,049
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
2019
|
|
2018
|
|
Increase (Decrease)
|
||||||
Sources of cash from investing activities:
|
|
|
|
|
|
||||||
Sales of non-real estate investments
|
$
|
147,332
|
|
|
$
|
103,679
|
|
|
$
|
43,653
|
|
Return of capital from unconsolidated real estate joint ventures
|
14
|
|
|
68,592
|
|
|
(68,578
|
)
|
|||
Proceeds from sales of real estate
|
6,619
|
|
|
20,190
|
|
|
(13,571
|
)
|
|||
|
153,965
|
|
|
192,461
|
|
|
(38,496
|
)
|
|||
Uses of cash for investing activities:
|
|
|
|
|
|
||||||
Purchases of real estate
|
2,259,778
|
|
|
1,037,180
|
|
|
1,222,598
|
|
|||
Additions to real estate
|
1,224,541
|
|
|
927,168
|
|
|
297,373
|
|
|||
Deposits for investing activities
|
18,107
|
|
|
2,000
|
|
|
16,107
|
|
|||
Acquisitions of interest in unconsolidated real estate joint ventures
|
—
|
|
|
35,922
|
|
|
(35,922
|
)
|
|||
Investments in unconsolidated real estate joint ventures
|
102,081
|
|
|
116,008
|
|
|
(13,927
|
)
|
|||
Additions to non-real estate investments
|
190,778
|
|
|
235,943
|
|
|
(45,165
|
)
|
|||
|
3,795,285
|
|
|
2,354,221
|
|
|
1,441,064
|
|
|||
|
|
|
|
|
|
||||||
Net cash used in investing activities
|
$
|
3,641,320
|
|
|
$
|
2,161,760
|
|
|
$
|
1,479,560
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
||||||
Proceeds from issuance of unsecured senior notes payable
|
$
|
2,721,169
|
|
|
$
|
899,321
|
|
|
$
|
1,821,848
|
|
Repayments of unsecured senior notes payable
|
(950,000
|
)
|
|
—
|
|
|
(950,000
|
)
|
|||
Repayments of borrowings from unsecured senior bank term loan
|
(350,000
|
)
|
|
(200,000
|
)
|
|
(150,000
|
)
|
|||
Borrowings from secured notes payable
|
—
|
|
|
17,784
|
|
|
(17,784
|
)
|
|||
Repayments of borrowings from secured notes payable
|
(306,199
|
)
|
|
(156,888
|
)
|
|
(149,311
|
)
|
|||
Borrowings from unsecured senior line of credit
|
5,056,000
|
|
|
4,741,000
|
|
|
315,000
|
|
|||
Repayments of borrowings from unsecured senior line of credit
|
(4,880,000
|
)
|
|
(4,583,000
|
)
|
|
(297,000
|
)
|
|||
Proceeds from issuance of commercial paper program
|
2,233,000
|
|
|
—
|
|
|
2,233,000
|
|
|||
Repayments of borrowings from commercial paper program
|
(2,233,000
|
)
|
|
—
|
|
|
(2,233,000
|
)
|
|||
Premium paid for early extinguishment of debt
|
(41,351
|
)
|
|
—
|
|
|
(41,351
|
)
|
|||
Payments of loan fees
|
(27,182
|
)
|
|
(19,292
|
)
|
|
(7,890
|
)
|
|||
Changes related to debt
|
1,222,437
|
|
|
698,925
|
|
|
523,512
|
|
|||
|
|
|
|
|
|
||||||
Contributions from and sales of noncontrolling interests
|
1,022,712
|
|
|
28,275
|
|
|
994,437
|
|
|||
Distributions to and purchases of noncontrolling interests
|
(48,225
|
)
|
|
(32,253
|
)
|
|
(15,972
|
)
|
|||
Proceeds from the issuance of common stock
|
1,216,445
|
|
|
1,293,301
|
|
|
(76,856
|
)
|
|||
Dividend payments
|
(451,170
|
)
|
|
(385,839
|
)
|
|
(65,331
|
)
|
|||
Taxes paid related to net settlement of equity awards
|
(25,477
|
)
|
|
—
|
|
|
(25,477
|
)
|
|||
Repurchase of 7.00% Series D cumulative convertible preferred stock
|
(9,240
|
)
|
|
(13,976
|
)
|
|
4,736
|
|
|||
Net cash provided by financing activities
|
$
|
2,927,482
|
|
|
$
|
1,588,433
|
|
|
$
|
1,339,049
|
|
(1)
|
Excludes the formation of a consolidated joint venture with Boston Properties, Inc. through non-cash contributions of real estate. Refer to “Subsequent Events” under the “Executive Summary” section of this Item 7 in this annual report on Form 10-K for additional information.
|
(2)
|
In January 2020, we entered into forward equity sales agreements to sell an aggregate of 6.9 million shares of our common stock (including the exercise of underwriters’ option) at a public offering price of $155.00 per share, before underwriting discounts. We expect to settle these forward equity sales agreements in 2020 and receive proceeds of approximately $1.0 billion, to be further adjusted as provided in the sales agreements.
|
|
|
Maximum Borrowings
|
|
Outstanding Balance(1)
|
|
Applicable Rate
|
|
Maturity Date
|
|
Facility Fee
|
Commercial paper program
|
|
$750 million
|
|
$—
|
|
N/A
|
|
N/A
|
|
N/A
|
Unsecured senior line of credit
|
|
$2.2 billion
|
|
$384 million
|
|
L+0.825%
|
|
January 2024(2)
|
|
0.15%
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Excludes loan fees as of December 31, 2019.
|
(2)
|
Includes two six-month extension options that we control.
|
|
Issuance
Date |
|
Stated Interest Rate
|
|
Effective Interest Rate
|
|
Maturity Date
|
|
Principal Amount
|
|
Net Proceeds
|
||||||
Issuances
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Unsecured senior notes payable – green bond
|
March
|
|
4.00
|
%
|
|
4.03
|
%
|
|
1/15/24
|
|
$
|
200
|
|
|
$
|
203.0
|
|
Unsecured senior notes payable – green bond
|
March
|
|
3.80
|
|
|
3.96
|
|
|
4/15/26
|
|
350
|
|
|
346.6
|
|
||
Unsecured senior notes payable
|
March
|
|
4.85
|
|
|
4.93
|
|
|
4/15/49
|
|
300
|
|
|
296.5
|
|
||
Unsecured senior notes payable
|
July
|
|
3.375
|
|
|
3.48
|
|
|
8/15/31
|
|
750
|
|
|
742.5
|
|
||
Unsecured senior notes payable
|
July/Sept
|
|
4.00
|
|
|
3.91
|
|
|
2/1/50
|
|
700
|
|
|
711.1
|
|
||
Unsecured senior notes payable
|
Sept
|
|
2.75
|
|
|
2.87
|
|
|
12/15/29
|
|
400
|
|
|
395.8
|
|
||
Weighted average/total
|
|
|
3.71
|
%
|
|
3.77
|
%
|
|
16.9 years
|
|
$
|
2,700
|
|
(1)
|
$
|
2,695.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Repayments of debt
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Secured notes payable
|
Jan
|
|
7.75
|
%
|
|
8.15
|
%
|
|
4/1/20
|
|
$
|
107
|
|
|
N/A
|
||
Secured construction loan
|
March
|
|
3.29
|
|
|
3.29
|
|
|
1/28/20
|
|
193
|
|
|
N/A
|
|||
Unsecured senior notes payable
|
July/Aug
|
|
2.75
|
|
|
2.96
|
|
|
1/15/20
|
|
400
|
|
|
N/A
|
|||
Unsecured senior notes payable
|
July/Aug
|
|
4.60
|
|
|
4.75
|
|
|
4/1/22
|
|
550
|
|
|
N/A
|
|||
Unsecured senior bank term loan
|
July/Sept
|
|
3.62
|
|
|
3.62
|
|
|
1/2/25
|
|
350
|
|
|
N/A
|
|||
Weighted average/total
|
|
|
3.97
|
%
|
|
4.11
|
%
|
|
2.4 years
|
|
$
|
1,600
|
|
(1)
|
|
(1)
|
The remaining proceeds received from our debt issuances, after repayments of debt, were used to fund the construction of our value-creation pipeline and acquisitions completed during 2019. Refer to Note 3 – “Investments in Real Estate” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for additional information.
|
•
|
We have proactively reduced outstanding LIBOR-based borrowings under our unsecured senior bank term loans and secured construction loans through repayments. From January 2017 to December 2018, we retired approximately $942.0 million of such debt.
|
•
|
During the year ended December 31, 2019, we further reduced our exposure to LIBOR as follows:
|
•
|
Repaid the $350.0 million balance and extinguished our unsecured senior bank term loan.
|
•
|
Terminated our LIBOR-based interest rate hedge agreements aggregating $350.0 million in conjunction with the extinguishment of our unsecured senior bank term loan. As a result, we had no outstanding interest rate hedge agreements as of December 31, 2019.
|
•
|
Fully repaid outstanding balances aggregating $193.1 million under our LIBOR-based construction loans.
|
•
|
During the three months ended September 30, 2019, we established a commercial paper program, under which we have the ability to issue up to $750.0 million of commercial paper notes, which bear interest at short-term fixed rates, with a maximum maturity of 397 days from the date of issuance. Our commercial paper program is not subjected to LIBOR and is used for funding short-term working capital needs. As of December 31, 2019, we had no borrowings outstanding under our commercial paper program.
|
•
|
We continue to prudently manage outstanding borrowings under our unsecured senior line of credit, which represented less than 6% of our total debt balance outstanding as of December 31, 2019. Excluding LIBOR-based debt held by our unconsolidated joint ventures, borrowings under our unsecured senior line of credit represented our only LIBOR-based debt outstanding as of December 31, 2019.
|
•
|
Our unsecured senior line of credit contains fallback language generally consistent with the ARRC’s Amendment Approach, which provides a streamlined amendment approach for negotiating a benchmark replacement and introduces clarity with respect to the fallback trigger events and an adjustment to be applied to the successor rate.
|
•
|
We continue to monitor developments by the ARRC and other governing bodies involved in LIBOR transition.
|
•
|
Issued an aggregate of 8.1 million shares of common stock, at a weighted-average price of $139.32 per share, for aggregate proceeds (net of underwriters’ discounts) of approximately $1.1 billion. During the year ended December 31, 2019, we incurred initial issuance costs aggregating $700 thousand in connection with these forward equity sales agreements.
|
•
|
Issued 602,484 shares of common stock under our ATM program, at a weighted-average price of $145.58 per share, for net proceeds of $86.1 million, during the three months ended June 30, 2019. As of December 31, 2019, we had approximately $22.5 million of gross proceeds available to be issued under our ATM program. We expect to file a new ATM program in the first quarter of 2020.
|
•
|
The proceeds were used to fund construction projects and to fund 2019 acquisitions.
|
|
Year Ended December 31,
|
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
||||||
Common stock dividends
|
$
|
447,029
|
|
|
$
|
380,632
|
|
|
$
|
66,397
|
|
7.00% Series D cumulative convertible preferred stock dividends
|
4,141
|
|
|
5,207
|
|
|
(1,066
|
)
|
|||
|
$
|
451,170
|
|
|
$
|
385,839
|
|
|
$
|
65,331
|
|
|
|
|
Payments by Period
|
||||||||||||||||
|
Total
|
|
2020
|
|
2021-2022
|
|
2023-2024
|
|
Thereafter
|
||||||||||
Secured and unsecured debt(1)(2)
|
$
|
6,796,440
|
|
|
$
|
6,418
|
|
|
$
|
14,128
|
|
|
$
|
1,822,107
|
|
|
$
|
4,953,787
|
|
Estimated interest payments on fixed-rate debt(3)
|
2,815,902
|
|
|
256,996
|
|
|
500,601
|
|
|
442,455
|
|
|
1,615,850
|
|
|||||
Ground lease obligations
|
674,741
|
|
|
13,879
|
|
|
28,410
|
|
|
28,979
|
|
|
603,473
|
|
|||||
Other obligations
|
25,198
|
|
|
1,253
|
|
|
3,988
|
|
|
4,506
|
|
|
15,451
|
|
|||||
Total
|
$
|
10,312,281
|
|
|
$
|
278,546
|
|
|
$
|
547,127
|
|
|
$
|
2,298,047
|
|
|
$
|
7,188,561
|
|
(1)
|
Amounts represent principal amounts due and exclude unamortized premiums (discounts) and deferred financing costs reflected on the consolidated balance sheets under Item 15 in this annual report on Form 10-K.
|
(2)
|
Payment dates reflect any extension options that we control.
|
(3)
|
Amounts are based upon contractual interest rates, including interest payment dates and scheduled maturity dates.
|
Covenant Ratios(1)
|
|
Requirement
|
|
December 31, 2019
|
Total Debt to Total Assets
|
Less than or equal to 60%
|
|
34%
|
|
Secured Debt to Total Assets
|
Less than or equal to 40%
|
|
2%
|
|
Consolidated EBITDA(2) to Interest Expense
|
Greater than or equal to 1.5x
|
|
7.0x
|
|
Unencumbered Total Asset Value to Unsecured Debt
|
Greater than or equal to 150%
|
|
277%
|
(1)
|
All covenant ratio titles utilize terms as defined in the respective debt agreements.
|
(2)
|
The calculation of consolidated EBITDA is based on the definitions contained in our loan agreements and is not directly comparable to the computation of EBITDA as described in Exchange Act Release No. 47226.
|
Covenant Ratios (1)
|
|
Requirement
|
|
December 31, 2019
|
|
Leverage Ratio
|
|
Less than or equal to 60.0%
|
|
29.7%
|
|
Secured Debt Ratio
|
|
Less than or equal to 45.0%
|
|
1.5%
|
|
Fixed-Charge Coverage Ratio
|
|
Greater than or equal to 1.50x
|
|
3.85x
|
|
Unsecured Interest Coverage Ratio
|
|
Greater than or equal to 1.75x
|
|
5.99x
|
|
(1)
|
All covenant ratio titles utilize terms as defined in the respective debt agreements.
|
|
Noncontrolling Interest Share of Consolidated Real Estate Joint Ventures
|
|
Our Share of Unconsolidated
Real Estate Joint Ventures |
||||||||||||
|
December 31, 2019
|
|
December 31, 2019
|
||||||||||||
|
Three Months Ended
|
|
Year Ended
|
|
Three Months Ended
|
|
Year Ended
|
||||||||
Net income
|
$
|
13,612
|
|
|
$
|
40,882
|
|
|
$
|
4,777
|
|
|
$
|
10,136
|
|
Depreciation and amortization
|
10,176
|
|
|
30,960
|
|
|
2,702
|
|
|
6,366
|
|
||||
Funds from operations
|
$
|
23,788
|
|
|
$
|
71,842
|
|
|
$
|
7,479
|
|
|
$
|
16,502
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Net income attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
$
|
350,995
|
|
|
$
|
363,983
|
|
|
$
|
145,395
|
|
Depreciation and amortization of real estate assets(1)
|
541,855
|
|
|
477,661
|
|
|
416,783
|
|
|||
Noncontrolling share of depreciation and amortization from consolidated real estate JVs
|
(30,960
|
)
|
|
(16,077
|
)
|
|
(14,762
|
)
|
|||
Our share of depreciation and amortization from unconsolidated real estate JVs
|
6,366
|
|
|
3,181
|
|
|
1,551
|
|
|||
Gain on sales of real estate – rental properties
|
(474
|
)
|
|
(8,704
|
)
|
|
(270
|
)
|
|||
Our share of gain on sales of real estate from unconsolidated real estate JVs
|
—
|
|
|
(35,678
|
)
|
|
(14,106
|
)
|
|||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
(111
|
)
|
|||
Impairment of real estate – rental properties
|
12,334
|
|
|
—
|
|
|
203
|
|
|||
Assumed conversion of 7.00% Series D cumulative convertible preferred stock
|
3,204
|
|
|
5,060
|
|
|
—
|
|
|||
Allocation to unvested restricted stock awards
|
(5,904
|
)
|
|
(5,961
|
)
|
|
(2,920
|
)
|
|||
Funds from operations attributable to Alexandria Real Estate Equities, Inc.’s common stockholders – diluted(1)
|
877,416
|
|
|
783,465
|
|
|
531,763
|
|
|||
Unrealized gains on non-real estate investments
|
(161,489
|
)
|
|
(99,634
|
)
|
|
—
|
|
|||
Realized gains on non-real estate investments
|
—
|
|
|
(14,680
|
)
|
|
—
|
|
|||
Impairment of real estate – land parcels
|
—
|
|
|
6,311
|
|
|
—
|
|
|||
Impairment of non-real estate investments
|
17,124
|
|
(2)
|
5,483
|
|
|
8,296
|
|
|||
Loss on early extinguishment of debt
|
47,570
|
|
(3)
|
1,122
|
|
|
3,451
|
|
|||
Loss on early termination of interest rate hedge agreements
|
1,702
|
|
(4)
|
—
|
|
|
—
|
|
|||
Our share of gain on early extinguishment of debt from unconsolidated real estate JVs
|
—
|
|
|
(761
|
)
|
|
—
|
|
|||
Preferred stock redemption charge
|
2,580
|
|
|
4,240
|
|
|
11,279
|
|
|||
Removal of assumed conversion of 7.00% Series D cumulative convertible preferred stock
|
(3,204
|
)
|
|
(5,060
|
)
|
|
—
|
|
|||
Allocation to unvested restricted stock awards
|
1,307
|
|
|
1,517
|
|
|
(321
|
)
|
|||
Funds from operations attributable to Alexandria Real Estate Equities, Inc.’s common stockholders – diluted, as adjusted
|
$
|
783,006
|
|
|
$
|
682,003
|
|
|
$
|
554,468
|
|
(1)
|
Calculated in accordance with standards established by the Nareit Board of Governors.
|
(2)
|
Relates to non-real estate investments in privately held entities.
|
(3)
|
Relates to the repayment of our unsecured senior notes payable due 2020 and 2022, unsecured senior bank term loan, and one secured note payable.
|
(4)
|
Represents loss on early termination of our interest rate hedge agreements. The loss is included within interest expense in our consolidated statements of operations. Refer to Note 11 – “Interest Rate Hedge Agreements” to our consolidated financial statements under Item 15 in this annual report on Form 10-K for additional information.
|
|
|
Year Ended December 31,
|
||||||||||
(Dollars per share)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net income per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders – diluted
|
|
$
|
3.12
|
|
|
$
|
3.52
|
|
|
$
|
1.58
|
|
Depreciation and amortization of real estate assets(1)
|
|
4.60
|
|
|
4.50
|
|
|
4.35
|
|
|||
Gain on sales of real estate – rental properties
|
|
—
|
|
|
(0.08
|
)
|
|
—
|
|
|||
Our share of gain on sales of real estate from unconsolidated real estate JVs
|
|
—
|
|
|
(0.35
|
)
|
|
(0.15
|
)
|
|||
Impairment of real estate – rental properties
|
|
0.11
|
|
|
—
|
|
|
—
|
|
|||
Allocation to unvested restricted stock awards
|
|
(0.06
|
)
|
|
(0.06
|
)
|
|
—
|
|
|||
Funds from operations per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders – basic and diluted(1)
|
|
7.77
|
|
|
7.53
|
|
|
5.78
|
|
|||
Unrealized gains on non-real estate investments
|
|
(1.44
|
)
|
|
(0.96
|
)
|
|
—
|
|
|||
Realized gains on non-real estate investments
|
|
—
|
|
|
(0.14
|
)
|
|
—
|
|
|||
Impairment of real estate – land parcels
|
|
—
|
|
|
0.06
|
|
|
—
|
|
|||
Impairment of non-real estate investments
|
|
0.15
|
|
(2)
|
0.05
|
|
|
0.09
|
|
|||
Loss on early extinguishment of debt
|
|
0.42
|
|
(2)
|
0.01
|
|
|
0.03
|
|
|||
Loss on early termination of interest rate hedge agreements
|
|
0.02
|
|
(2)
|
—
|
|
|
—
|
|
|||
Our share of gain on early extinguishment of debt from unconsolidated real estate JVs
|
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|||
Preferred stock redemption charge
|
|
0.02
|
|
|
0.04
|
|
|
0.12
|
|
|||
Allocation to unvested restricted stock awards
|
|
0.02
|
|
|
0.02
|
|
|
—
|
|
|||
Funds from operations per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders – diluted, as adjusted
|
|
$
|
6.96
|
|
|
$
|
6.60
|
|
|
$
|
6.02
|
|
|
|
|
|
|
|
|
||||||
Weighted-average shares of common stock outstanding(3) for calculations of:
|
|
|
|
|
|
|
||||||
EPS – diluted
|
|
112,524
|
|
|
103,321
|
|
|
92,063
|
|
|||
Funds from operations – diluted, per share
|
|
112,966
|
|
|
104,048
|
|
|
92,063
|
|
|||
Funds from operations – diluted, as adjusted, per share
|
|
112,524
|
|
|
103,321
|
|
|
92,063
|
|
(1)
|
Calculated in accordance with standards established by the Nareit Board of Governors.
|
(2)
|
Refer to footnotes 2, 3, and 4, respectively, on the previous page for additional information.
|
(3)
|
Refer to the definition of “Weighted-Average Shares of Common Stock Outstanding – Diluted” within this section of this Item 7 for additional information.
|
|
|
Three Months Ended December 31,
|
|
Year Ended December 31,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income (loss)
|
|
$
|
216,053
|
|
|
$
|
(18,631
|
)
|
|
$
|
404,047
|
|
|
$
|
402,793
|
|
Interest expense
|
|
45,493
|
|
|
40,239
|
|
|
173,675
|
|
|
157,495
|
|
||||
Income taxes
|
|
1,269
|
|
|
613
|
|
|
4,343
|
|
|
3,227
|
|
||||
Depreciation and amortization
|
|
140,518
|
|
|
124,990
|
|
|
544,612
|
|
|
477,661
|
|
||||
Stock compensation expense
|
|
10,239
|
|
|
9,810
|
|
|
43,640
|
|
|
35,019
|
|
||||
Loss on early extinguishment of debt
|
|
—
|
|
|
—
|
|
|
47,570
|
|
|
1,122
|
|
||||
Our share of gain on early extinguishment of debt from unconsolidated real estate JVs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(761
|
)
|
||||
Gain on sales of real estate
|
|
(474
|
)
|
|
(8,704
|
)
|
|
(474
|
)
|
|
(8,704
|
)
|
||||
Our share of gain on sales of real estate from unconsolidated real estate JVs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35,678
|
)
|
||||
Significant realized gains on non-real estate investments
|
|
—
|
|
|
(6,428
|
)
|
|
—
|
|
|
(6,428
|
)
|
||||
Unrealized (gains) losses on non-real estate investments
|
|
(148,268
|
)
|
|
94,850
|
|
|
(161,489
|
)
|
|
(99,634
|
)
|
||||
Impairment of real estate
|
|
12,334
|
|
|
—
|
|
|
12,334
|
|
|
6,311
|
|
||||
Impairment of non-real estate investments
|
|
9,991
|
|
|
5,483
|
|
|
17,124
|
|
|
5,483
|
|
||||
Adjusted EBITDA
|
|
$
|
287,155
|
|
|
$
|
242,222
|
|
|
$
|
1,085,382
|
|
|
$
|
937,906
|
|
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
408,114
|
|
|
$
|
340,463
|
|
|
$
|
1,531,296
|
|
|
$
|
1,327,459
|
|
Non-real estate investments – total realized gains
|
|
4,399
|
|
|
11,319
|
|
|
33,158
|
|
|
37,129
|
|
||||
Significant realized gains on non-real estate investments
|
|
—
|
|
|
(6,428
|
)
|
|
—
|
|
|
(6,428
|
)
|
||||
Impairment of non-real estate investments
|
|
9,991
|
|
|
5,483
|
|
|
17,124
|
|
|
5,483
|
|
||||
Revenues, as adjusted
|
|
$
|
422,504
|
|
|
$
|
350,837
|
|
|
$
|
1,581,578
|
|
|
$
|
1,363,643
|
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA margin
|
|
68%
|
|
|
69%
|
|
|
69%
|
|
|
69%
|
|
|
|
Three Months Ended December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Adjusted EBITDA
|
|
$
|
287,155
|
|
|
$
|
242,222
|
|
|
|
|
|
|
||||
Interest expense
|
|
$
|
45,493
|
|
|
$
|
40,239
|
|
Capitalized interest
|
|
23,822
|
|
|
19,902
|
|
||
Amortization of loan fees
|
|
(2,241
|
)
|
|
(2,401
|
)
|
||
Amortization of debt premiums
|
|
907
|
|
|
611
|
|
||
Cash interest
|
|
67,981
|
|
|
58,351
|
|
||
Dividends on preferred stock
|
|
—
|
|
|
1,155
|
|
||
Fixed charges
|
|
$
|
67,981
|
|
|
$
|
59,506
|
|
|
|
|
|
|
||||
Fixed-charge coverage ratio:
|
|
|
|
|
||||
– period annualized
|
|
4.2x
|
|
|
4.1x
|
|
||
– trailing 12 months
|
|
4.2x
|
|
|
4.2x
|
|
•
|
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 and our total cash investment in the property.
|
Property/Submarket
|
|
RSF
|
|
Intermediate-term projects:
|
|
|
|
3825 Fabian Way/Greater Stanford
|
|
250,000
|
|
960 Industrial Road/Greater Stanford
|
|
110,000
|
|
9363, 9373, and 9393 Towne Centre Drive/University Town Center
|
|
140,398
|
|
10260 Campus Point Drive/University Town Center
|
|
109,164
|
|
10931 and 10933 North Torrey Pines Road/Torrey Pines
|
|
92,450
|
|
|
|
702,012
|
|
Future projects:
|
|
|
|
3875 Fabian Way/Greater Stanford
|
|
228,000
|
|
219 East 42nd Street/New York City
|
|
349,947
|
|
4161 Campus Point Court/University Town Center
|
|
159,884
|
|
4110 Campus Point Court/University Town Center
|
|
15,667
|
|
4045 Sorrento Valley Boulevard/Sorrento Valley
|
|
10,926
|
|
4075 Sorrento Valley Boulevard/Sorrento Valley
|
|
40,000
|
|
601 Dexter Avenue North/Lake Union
|
|
18,680
|
|
|
|
823,104
|
|
Total value-creation RSF currently included in rental properties
|
|
1,525,116
|
|
|
December 31,
|
|||||||
|
2019
|
|
2018
|
|||||
Secured notes payable
|
$
|
349,352
|
|
|
$
|
630,547
|
|
|
Unsecured senior notes payable
|
6,044,127
|
|
|
4,292,293
|
|
|||
Unsecured senior line of credit
|
384,000
|
|
|
208,000
|
|
|||
Unsecured senior bank term loan
|
—
|
|
|
347,415
|
|
|||
Unamortized deferred financing costs
|
47,299
|
|
|
31,413
|
|
|||
Cash and cash equivalents
|
(189,681
|
)
|
|
(234,181
|
)
|
|||
Restricted cash
|
(53,008
|
)
|
|
(37,949
|
)
|
|||
Net debt
|
$
|
6,582,089
|
|
|
$
|
5,237,538
|
|
|
|
|
|
|
|||||
Net debt
|
$
|
6,582,089
|
|
|
$
|
5,237,538
|
|
|
7.00% Series D cumulative convertible preferred stock
|
—
|
|
(1
|
)
|
64,336
|
|
||
Net debt and preferred stock
|
$
|
6,582,089
|
|
|
$
|
5,301,874
|
|
|
|
|
|
|
|||||
Adjusted EBITDA:
|
|
|
|
|||||
– quarter annualized
|
$
|
1,148,620
|
|
|
$
|
968,888
|
|
|
– trailing 12 months
|
$
|
1,085,382
|
|
|
$
|
937,906
|
|
|
|
|
|
|
|||||
Net debt to Adjusted EBITDA:
|
|
|
|
|||||
– quarter annualized
|
5.7
|
x
|
|
5.4
|
x
|
|||
– trailing 12 months
|
6.1
|
x
|
|
5.6
|
x
|
|||
Net debt and preferred stock to Adjusted EBITDA:
|
|
|
|
|||||
– quarter annualized
|
5.7
|
x
|
|
5.5
|
x
|
|||
– trailing 12 months
|
6.1
|
x
|
|
5.7
|
x
|
(1)
|
In October 2019, we completed the conversion of all 2.3 million outstanding shares of our Series D Convertible Preferred Stock into shares of our common stock. Refer to the “7.00% Series D Convertible Preferred Stock Repurchases and Conversion” section in Note 16 – “Stockholders’ Equity” to our consolidated financial statements under Item 15 in this annual report for additional information.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
|
$
|
404,047
|
|
|
$
|
402,793
|
|
|
$
|
194,204
|
|
|
|
|
|
|
|
|
||||||
Equity in earnings of unconsolidated real estate joint ventures
|
|
(10,136
|
)
|
|
(43,981
|
)
|
|
(15,426
|
)
|
|||
General and administrative expenses
|
|
108,823
|
|
|
90,405
|
|
|
75,009
|
|
|||
Interest expense
|
|
173,675
|
|
|
157,495
|
|
|
128,645
|
|
|||
Depreciation and amortization
|
|
544,612
|
|
|
477,661
|
|
|
416,783
|
|
|||
Impairment of real estate
|
|
12,334
|
|
|
6,311
|
|
|
203
|
|
|||
Loss on early extinguishment of debt
|
|
47,570
|
|
|
1,122
|
|
|
3,451
|
|
|||
Gain on sales of real estate – rental properties
|
|
(474
|
)
|
|
(8,704
|
)
|
|
(270
|
)
|
|||
Gain on sales of real estate – land parcels
|
|
—
|
|
|
—
|
|
|
(111
|
)
|
|||
Investment income
|
|
(194,647
|
)
|
|
(136,763
|
)
|
|
—
|
|
|||
Net operating income
|
|
1,085,804
|
|
|
946,339
|
|
|
802,488
|
|
|||
Straight-line rent revenue
|
|
(104,235
|
)
|
|
(93,883
|
)
|
|
(107,643
|
)
|
|||
Amortization of acquired below-market leases
|
|
(29,813
|
)
|
|
(21,938
|
)
|
|
(19,055
|
)
|
|||
Net operating income (cash basis)
|
|
$
|
951,756
|
|
|
$
|
830,518
|
|
|
$
|
675,790
|
|
|
|
|
|
|
|
|
||||||
Net operating income (from above)
|
|
$
|
1,085,804
|
|
|
$
|
946,339
|
|
|
$
|
802,488
|
|
Total revenues
|
|
$
|
1,531,296
|
|
|
$
|
1,327,459
|
|
|
$
|
1,128,097
|
|
Operating margin
|
|
71%
|
|
71%
|
|
71%
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Income from rentals
|
|
$
|
1,516,864
|
|
|
$
|
1,314,781
|
|
|
$
|
1,122,325
|
|
Rental revenues
|
|
(1,165,788
|
)
|
|
(1,010,718
|
)
|
|
(863,181
|
)
|
|||
Tenant recoveries
|
|
$
|
351,076
|
|
|
$
|
304,063
|
|
|
$
|
259,144
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Unencumbered net operating income
|
$
|
1,024,619
|
|
|
$
|
829,834
|
|
Encumbered net operating income
|
61,185
|
|
|
116,505
|
|
||
Total net operating income
|
$
|
1,085,804
|
|
|
$
|
946,339
|
|
Unencumbered net operating income as a percentage of total net operating income
|
94%
|
|
|
88%
|
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Weighted-average shares of common stock outstanding:
|
|
|
|
|
|
|||
Basic shares for EPS
|
112,204
|
|
|
103,010
|
|
|
91,546
|
|
Outstanding forward equity sales agreements
|
320
|
|
|
311
|
|
|
517
|
|
Series D Convertible Preferred Stock
|
—
|
|
|
—
|
|
|
—
|
|
Diluted for EPS
|
112,524
|
|
|
103,321
|
|
|
92,063
|
|
|
|
|
|
|
|
|||
Basic shares for EPS
|
112,204
|
|
|
103,010
|
|
|
91,546
|
|
Outstanding forward equity sales agreements
|
320
|
|
|
311
|
|
|
517
|
|
Series D Convertible Preferred Stock
|
442
|
|
|
727
|
|
|
—
|
|
Diluted for FFO
|
112,966
|
|
|
104,048
|
|
|
92,063
|
|
|
|
|
|
|
|
|||
Basic shares for EPS
|
112,204
|
|
|
103,010
|
|
|
91,546
|
|
Outstanding forward equity sales agreements
|
320
|
|
|
311
|
|
|
517
|
|
Series D Convertible Preferred Stock
|
—
|
|
|
—
|
|
|
—
|
|
Diluted for FFO, as adjusted
|
112,524
|
|
|
103,321
|
|
|
92,063
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Annualized effect on future earnings due to variable-rate debt:
|
|
|
|
||||
Rate increase of 1%
|
$
|
(3,600
|
)
|
|
$
|
(2,524
|
)
|
Rate decrease of 1%
|
$
|
3,600
|
|
|
$
|
2,524
|
|
|
|
|
|
||||
Effect on fair value of total consolidated debt:
|
|
|
|
||||
Rate increase of 1%
|
$
|
(527,768
|
)
|
|
$
|
(237,413
|
)
|
Rate decrease of 1%
|
$
|
605,862
|
|
|
$
|
254,960
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Equity price risk:
|
|
|
|
||||
Fair value increase of 10%
|
$
|
114,059
|
|
|
$
|
89,226
|
|
Fair value decrease of 10%
|
$
|
(114,059
|
)
|
|
$
|
(89,226
|
)
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Effect on potential future earnings due to foreign currency exchange rate:
|
|
|
|
||||
Rate increase of 10%
|
$
|
107
|
|
|
$
|
82
|
|
Rate decrease of 10%
|
$
|
(107
|
)
|
|
$
|
(82
|
)
|
|
|
|
|
||||
Effect on the fair value of net investment in foreign subsidiaries due to foreign currency exchange rate:
|
|
|
|
||||
Rate increase of 10%
|
$
|
10,120
|
|
|
$
|
9,658
|
|
Rate decrease of 10%
|
$
|
(10,120
|
)
|
|
$
|
(9,658
|
)
|
|
|
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 Stock Award and Incentive Plan
|
|
—
|
|
—
|
|
1,858,673
|
|
Page
|
|
|
Audited Consolidated Financial Statements of Alexandria Real Estate Equities, Inc.:
|
|
Consolidated Balance Sheets as of December 31, 2019 and 2018
|
|
Consolidated Financial Statements for the Years Ended December 31, 2019, 2018, and 2017:
|
|
Consolidated Statements of Operations
|
|
Consolidated Statements of Comprehensive Income
|
|
Consolidated Statements of Changes in Stockholders’ Equity and Noncontrolling Interests
|
|
Consolidated Statements of Cash Flows
|
|
Exhibit
Number
|
|
Exhibit Title
|
|
Incorporated by Reference to:
|
|
Date Filed
|
3.1*
|
|
|
Form 10-Q
|
|
August 14, 1997
|
|
3.2*
|
|
|
Form 10-Q
|
|
August 14, 1997
|
|
3.3*
|
|
|
Form 8-K
|
|
May 12, 2017
|
|
3.4*
|
|
|
Form 10-Q
|
|
August 13, 1999
|
|
3.5*
|
|
|
Form 8-K
|
|
February 10, 2000
|
|
3.6*
|
|
|
Form 8-K
|
|
February 10, 2000
|
|
3.7*
|
|
|
Form 8-A
|
|
January 18, 2002
|
|
3.8*
|
|
|
Form 8-A
|
|
June 28, 2004
|
|
3.9*
|
|
|
Form 8-K
|
|
March 25, 2008
|
|
3.10*
|
|
|
Form 8-K
|
|
March 14, 2012
|
|
3.11*
|
|
|
Form 8-K
|
|
May 12, 2017
|
|
3.12*
|
|
|
Form 8-K
|
|
August 2, 2018
|
|
4.1*
|
|
|
Form 10-Q
|
|
May 5, 2011
|
|
4.2*
|
|
|
Form 8-K
|
|
February 29, 2012
|
Exhibit
Number
|
|
Exhibit Title
|
|
Incorporated by Reference to:
|
|
Date Filed
|
4.3*
|
|
|
Form 8-K
|
|
June 7, 2013
|
|
4.4*
|
|
|
Form 8-K
|
|
June 7, 2013
|
|
4.5*
|
|
|
Form 8-K
|
|
July 18, 2014
|
|
4.6*
|
|
|
Form 8-K
|
|
July 18, 2014
|
|
4.7*
|
|
|
Form 8-K
|
|
November 17, 2015
|
|
4.8*
|
|
|
Form 8-K
|
|
November 17, 2015
|
|
4.9*
|
|
|
Form 8-K
|
|
November 17, 2015
|
|
4.10*
|
|
|
Form 8-K
|
|
June 10, 2016
|
|
4.11*
|
|
|
Form 8-K
|
|
June 10, 2016
|
|
4.12*
|
|
|
Form 8-K
|
|
March 3, 2017
|
|
4.13*
|
|
|
Form 8-K
|
|
March 3, 2017
|
|
4.14*
|
|
|
Form 8-K
|
|
March 3, 2017
|
|
4.15*
|
|
|
|
Form 8-K
|
|
November 20, 2017
|
4.16*
|
|
|
Form 8-K
|
|
November 20, 2017
|
|
4.17*
|
|
|
Form 8-K
|
|
June 21, 2018
|
|
4.18*
|
|
|
Form 8-K
|
|
March 21, 2019
|
|
4.19*
|
|
|
Form 8-K
|
|
June 21, 2018
|
|
4.20*
|
|
|
Form 8-K
|
|
June 21, 2018
|
|
4.21*
|
|
|
Form 8-K
|
|
June 21, 2018
|
|
4.22*
|
|
|
Form 8-K
|
|
March 21, 2019
|
|
4.23*
|
|
|
Form 8-K
|
|
March 21, 2019
|
|
4.24*
|
|
|
Form 8-K
|
|
March 21, 2019
|
|
4.25*
|
|
|
Form 8-K
|
|
March 21, 2019
|
|
4.26*
|
|
|
Form 8-K
|
|
July 15, 2019
|
|
4.27*
|
|
|
Form 8-K
|
|
July 15, 2019
|
Exhibit
Number
|
|
Exhibit Title
|
|
Incorporated by Reference to:
|
|
Date Filed
|
4.28*
|
|
|
Form 8-K
|
|
July 15, 2019
|
|
4.29*
|
|
|
Form 8-K
|
|
September 12, 2019
|
|
4.30*
|
|
|
Form 8-K
|
|
July 15, 2019
|
|
4.31*
|
|
|
|
Form 8-K
|
|
September 12, 2019
|
4.32*
|
|
|
Form 8-K
|
|
September 12, 2019
|
|
4.33
|
|
|
|
|
Filed herewith
|
|
10.1*
|
|
|
Form 10-Q
|
|
October 30, 2018
|
|
10.2*
|
|
|
Form 8-K
|
|
May 23, 2018
|
|
10.3*
|
(1)
|
|
Form S-11
|
|
May 5, 1997
|
|
10.4*
|
(1)
|
|
Form S-11
|
|
May 5, 1997
|
|
10.5*
|
(1)
|
|
Form S-11
|
|
May 5, 1997
|
|
10.6*
|
(1)
|
|
Form 10-K
|
|
January 30, 2018
|
|
10.7*
|
(1)
|
|
Form 10-K
|
|
January 30, 2018
|
|
10.8*
|
(1)
|
|
Form 10-K
|
|
January 30, 2018
|
|
10.9*
|
(1)
|
|
Form 10-K
|
|
January 30, 2018
|
|
10.10*
|
(1)
|
|
Form 10-K
|
|
March 1, 2011
|
|
10.11*
|
(1)
|
|
Form 10-K
|
|
March 1, 2011
|
Exhibit
Number
|
|
Exhibit Title
|
|
Incorporated by Reference to:
|
|
Date Filed
|
10.12*
|
(1)
|
|
Form 8-K
|
|
April 7, 2015
|
|
10.13*
|
(1)
|
|
Form 8-K
|
|
July 3, 2017
|
|
10.14*
|
(1)
|
|
Form 10-Q
|
|
May 1, 2018
|
|
10.15*
|
(1)
|
|
Form 8-K
|
|
January 18, 2019
|
|
10.16*
|
(1)
|
|
Form 10-Q
|
|
May 1, 2018
|
|
10.17*
|
(1)
|
|
Form 10-Q
|
|
July 31, 2018
|
|
10.18*
|
(1)
|
|
Form 10-Q
|
|
May 1, 2018
|
|
10.19*
|
(1)
|
|
Form 10-Q
|
|
May 1, 2018
|
|
10.20*
|
(1)
|
|
Form 10-Q
|
|
May 1, 2018
|
|
10.21*
|
(1)
|
|
Form 10-Q
|
|
July 31, 2018
|
|
10.22
|
(1)
|
|
|
|
Filed herewith
|
|
10.23*
|
(1)
|
|
Form 8-K
|
|
June 17, 2010
|
|
10.24*
|
(1)
|
|
Form 10-Q
|
|
November 9, 2011
|
|
10.25*
|
(1)
|
|
Form 10-K
|
|
March 1, 2011
|
|
14.1
|
|
|
|
|
Filed herewith
|
|
21.1
|
|
|
|
|
Filed herewith
|
|
23.1
|
|
|
|
|
Filed herewith
|
|
31.1
|
|
|
|
|
Filed herewith
|
|
31.2
|
|
|
|
|
Filed herewith
|
|
31.3
|
|
|
|
|
Filed herewith
|
|
31.4
|
|
|
|
|
Filed herewith
|
|
32.0
|
|
|
|
|
Filed herewith
|
Exhibit
Number
|
|
Exhibit Title
|
|
Incorporated by Reference to:
|
|
Date Filed
|
101.1
|
|
The following materials from the Company’s annual report on Form 10-K for the year ended December 31, 2019, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of December 31, 2019 and 2018, (ii) Consolidated Statements of Operations for the years ended December 31, 2019, 2018, and 2017, (iii) Consolidated Statements of Comprehensive Income for the years ended December 31, 2019, 2018, and 2017, (iv) Consolidated Statements of Changes in Stockholders’ Equity and Noncontrolling Interests for the years ended December 31, 2019, 2018, and 2017, (v) Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018, and 2017, (vi) Notes to Consolidated Financial Statements, and (vii) Schedule III - Consolidated Financial Statement Schedule of Real Estate and Accumulated Depreciation of the Company.
|
|
|
|
Filed herewith
|
104
|
|
Cover Page Interactive Data File (embedded within the Inline XBRL document)
|
|
|
|
|
|
|
|
ALEXANDRIA REAL ESTATE EQUITIES, INC.
|
Dated:
|
February 4, 2020
|
By:
|
/s/ Joel S. Marcus
|
|
|
|
Joel S. Marcus
Executive Chairman
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ Stephen A. Richardson
|
|
|
|
Stephen A. Richardson
Co-Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ Peter M. Moglia
|
|
|
|
Co-Chief Executive Officer and Co-Chief Investment Officer
(Principal Executive Officer)
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Joel S. Marcus
|
|
Executive Chairman
(Principal Executive Officer)
|
|
February 4, 2020
|
Joel S. Marcus
|
|
|||
|
|
|
|
|
/s/ Stephen A. Richardson
|
|
Co-Chief Executive Officer
(Principal Executive Officer) |
|
February 4, 2020
|
Stephen A. Richardson
|
|
|||
|
|
|
|
|
/s/ Peter M. Moglia
|
|
Co-Chief Executive Officer and Co-Chief Investment Officer
(Principal Executive Officer)
|
|
February 4, 2020
|
Peter M. Moglia
|
|
|||
|
|
|
|
|
/s/ Dean A. Shigenaga
|
|
Co-President and Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer) |
|
February 4, 2020
|
Dean A. Shigenaga
|
|
|||
|
|
|
|
|
/s/ Steven R. Hash
|
|
Lead Director
|
|
February 4, 2020
|
Steven R. Hash
|
|
|||
|
|
|
|
|
/s/ John L. Atkins, III
|
|
Director
|
|
February 4, 2020
|
John L. Atkins, III
|
|
|||
|
|
|
|
|
/s/ James P. Cain
|
|
Director
|
|
February 4, 2020
|
James P. Cain
|
|
|||
|
|
|
|
|
/s/ Maria C. Freire
|
|
Director
|
|
February 4, 2020
|
Maria C. Freire
|
|
|||
|
|
|
|
|
/s/ Richard H. Klein
|
|
Director
|
|
February 4, 2020
|
Richard H. Klein
|
|
|||
|
|
|
|
|
/s/ James H. Richardson
|
|
Director
|
|
February 4, 2020
|
James H. Richardson
|
|
|||
|
|
|
|
|
/s/ Michael A. Woronoff
|
|
Director
|
|
February 4, 2020
|
Michael A. Woronoff
|
|
|
|
Recognition of acquired real estate – Purchase price accounting
|
Description of the Matter
|
|
As more fully disclosed in Notes 2 and 3 to the consolidated financial statements, during 2019, the Company completed the acquisition of 47 properties for a total purchase price of $2.3 billion. The transactions were accounted for as asset acquisitions, and the purchase prices were allocated based on the relative fair values of the assets acquired (including land, buildings and improvements, and the intangible value of acquired above-market leases, acquired in-place leases, tenant relationships and other intangible assets) and liabilities assumed (including the intangible value of acquired below-market leases and other intangible liabilities). The fair value of tangible and intangible assets and liabilities is based on available comparable market information, including estimated replacement costs, rental rates, recent market transactions, and estimated cash flow projections that utilize appropriate discount and capitalization rates. Estimates of future cash flows are based on a number of factors, including the historical operating results, known and anticipated trends, and market or economic conditions, that may affect the property.
Auditing the Company’s estimate of the fair value of the acquired tangible and intangible assets and liabilities involves significant estimation uncertainty due to the judgment used by management in selecting key assumptions based on recent comparable transactions or market data, which are primarily unobservable inputs, and the sensitivity of the estimates to changes in assumptions. The allocation of purchase price to the components of properties acquired could have an effect on the Company’s net income due to the useful depreciable and amortizable lives applicable to each component and the recognition of the related depreciation or amortization expense in the Company’s consolidated statements of operations.
|
|
|
|
How we Addressed the Matter in Our Audit
|
|
Our audit procedures related to the key assumptions utilized in the Company’s purchase price accounting for acquired real estate included the following procedures, among others:
We tested the design and operating effectiveness of controls over the Company’s process for determining and reviewing the key inputs and assumptions used in estimating the fair value of acquired assets and liabilities and allocating purchase price to the various components.
We evaluated the incorporation of the key assumptions in the purchase price accounting model and recalculated the model’s results. To test the fair values of acquired tangible and intangible assets and liabilities used in the purchase price allocation, we performed procedures to evaluate the valuation methods and significant assumptions used by management. We evaluated the completeness and accuracy of the underlying data supporting the determination of the various inputs. Our internal valuation specialists assisted us in evaluating the methodology used by the Company and considered the consistency of the land and building values, estimated replacement costs, market rental rates, ground lease rates and discount rates with external data sources.
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
|
|
||
Investments in real estate
|
$
|
14,844,038
|
|
|
$
|
11,913,693
|
|
Investments in unconsolidated real estate joint ventures
|
346,890
|
|
|
237,507
|
|
||
Cash and cash equivalents
|
189,681
|
|
|
234,181
|
|
||
Restricted cash
|
53,008
|
|
|
37,949
|
|
||
Tenant receivables
|
10,691
|
|
|
9,798
|
|
||
Deferred rent
|
641,844
|
|
|
530,237
|
|
||
Deferred leasing costs
|
270,043
|
|
|
239,070
|
|
||
Investments
|
1,140,594
|
|
|
892,264
|
|
||
Other assets
|
893,714
|
|
|
370,257
|
|
||
Total assets
|
$
|
18,390,503
|
|
|
$
|
14,464,956
|
|
|
|
|
|
|
|
||
Liabilities, Noncontrolling Interests, and Equity
|
|
|
|
|
|
||
Secured notes payable
|
$
|
349,352
|
|
|
$
|
630,547
|
|
Unsecured senior notes payable
|
6,044,127
|
|
|
4,292,293
|
|
||
Unsecured senior line of credit
|
384,000
|
|
|
208,000
|
|
||
Unsecured senior bank term loan
|
—
|
|
|
347,415
|
|
||
Accounts payable, accrued expenses, and other liabilities
|
1,320,268
|
|
|
981,707
|
|
||
Dividends payable
|
126,278
|
|
|
110,280
|
|
||
Total liabilities
|
8,224,025
|
|
|
6,570,242
|
|
||
|
|
|
|
|
|
||
Commitments and contingencies
|
|
|
|
|
|
||
|
|
|
|
|
|
||
Redeemable noncontrolling interests
|
12,300
|
|
|
10,786
|
|
||
|
|
|
|
|
|
||
Alexandria Real Estate Equities, Inc.’s stockholders’ equity:
|
|
|
|
|
|
||
7.00% Series D cumulative convertible preferred stock, $0.01 par value per share, 10,000,000 shares authorized; 0 and 2,573,432 shares issued and outstanding as of December 31, 2019 and 2018, respectively; $25 liquidation value per share
|
—
|
|
|
64,336
|
|
||
Common stock, $0.01 par value per share, 200,000,000 shares authorized as of December 31, 2019 and 2018; 120,800,315 and 111,011,816 shares issued and outstanding as of December 31, 2019 and 2018, respectively
|
1,208
|
|
|
1,110
|
|
||
Additional paid-in capital
|
8,874,367
|
|
|
7,286,954
|
|
||
Accumulated other comprehensive loss
|
(9,749
|
)
|
|
(10,435
|
)
|
||
Alexandria Real Estate Equities, Inc.’s stockholders’ equity
|
8,865,826
|
|
|
7,341,965
|
|
||
Noncontrolling interests
|
1,288,352
|
|
|
541,963
|
|
||
Total equity
|
10,154,178
|
|
|
7,883,928
|
|
||
Total liabilities, noncontrolling interests, and equity
|
$
|
18,390,503
|
|
|
$
|
14,464,956
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues:
|
|
|
|
|
|
|
|
||||
Income from rentals
|
$
|
1,516,864
|
|
|
$
|
1,314,781
|
|
|
$
|
1,122,325
|
|
Other income
|
14,432
|
|
|
12,678
|
|
|
5,772
|
|
|||
Total revenues
|
1,531,296
|
|
|
1,327,459
|
|
|
1,128,097
|
|
|||
|
|
|
|
|
|
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
||||
Rental operations
|
445,492
|
|
|
381,120
|
|
|
325,609
|
|
|||
General and administrative
|
108,823
|
|
|
90,405
|
|
|
75,009
|
|
|||
Interest
|
173,675
|
|
|
157,495
|
|
|
128,645
|
|
|||
Depreciation and amortization
|
544,612
|
|
|
477,661
|
|
|
416,783
|
|
|||
Impairment of real estate
|
12,334
|
|
|
6,311
|
|
|
203
|
|
|||
Loss on early extinguishment of debt
|
47,570
|
|
|
1,122
|
|
|
3,451
|
|
|||
Total expenses
|
1,332,506
|
|
|
1,114,114
|
|
|
949,700
|
|
|||
|
|
|
|
|
|
|
|
||||
Equity in earnings of unconsolidated real estate joint ventures
|
10,136
|
|
|
43,981
|
|
|
15,426
|
|
|||
Investment income
|
194,647
|
|
|
136,763
|
|
|
—
|
|
|||
Gain on sales of real estate – rental properties
|
474
|
|
|
8,704
|
|
|
270
|
|
|||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
111
|
|
|||
Net income
|
404,047
|
|
|
402,793
|
|
|
194,204
|
|
|||
Net income attributable to noncontrolling interests
|
(40,882
|
)
|
|
(23,481
|
)
|
|
(25,111
|
)
|
|||
Net income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
363,165
|
|
|
379,312
|
|
|
169,093
|
|
|||
Dividends on preferred stock
|
(3,204
|
)
|
|
(5,060
|
)
|
|
(7,666
|
)
|
|||
Preferred stock redemption charge
|
(2,580
|
)
|
|
(4,240
|
)
|
|
(11,279
|
)
|
|||
Net income attributable to unvested restricted stock awards
|
(6,386
|
)
|
|
(6,029
|
)
|
|
(4,753
|
)
|
|||
Net income attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
$
|
350,995
|
|
|
$
|
363,983
|
|
|
$
|
145,395
|
|
|
|
|
|
|
|
|
|
||||
Net income per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders:
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
3.13
|
|
|
$
|
3.53
|
|
|
$
|
1.59
|
|
Diluted
|
$
|
3.12
|
|
|
$
|
3.52
|
|
|
$
|
1.58
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
$
|
404,047
|
|
|
$
|
402,793
|
|
|
$
|
194,204
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|||
Unrealized gains on available-for-sale equity securities:
|
|
|
|
|
|
|
|
|
|||
Unrealized holding gains arising during the period
|
—
|
|
|
—
|
|
|
24,360
|
|
|||
Reclassification adjustment for losses included in net income
|
—
|
|
|
—
|
|
|
6,118
|
|
|||
Unrealized gains on available-for-sale equity securities, net
|
—
|
|
|
—
|
|
|
30,478
|
|
|||
|
|
|
|
|
|
|
|
|
|||
Unrealized (losses) gains on interest rate hedge agreements:
|
|
|
|
|
|
|
|
|
|||
Unrealized interest rate hedge (losses) gains arising during the period
|
(1,763
|
)
|
|
1,622
|
|
|
2,837
|
|
|||
Reclassification adjustment for amortization to interest expense included in net income
|
(1,777
|
)
|
|
(4,941
|
)
|
|
1,915
|
|
|||
Reclassification of losses related to terminated interest rate hedge instruments to interest expense included in net income
|
1,702
|
|
|
—
|
|
|
—
|
|
|||
Unrealized (losses) gains on interest rate hedge agreements, net
|
(1,838
|
)
|
|
(3,319
|
)
|
|
4,752
|
|
|||
|
|
|
|
|
|
|
|
|
|||
Unrealized gains (losses) on foreign currency translation:
|
|
|
|
|
|
|
|
|
|||
Unrealized foreign currency translation gains (losses) arising during the period
|
2,524
|
|
|
(7,369
|
)
|
|
7,774
|
|
|||
Reclassification adjustment for cumulative foreign currency translation losses included in net income (loss) upon sale or liquidation
|
—
|
|
|
—
|
|
|
1,599
|
|
|||
Unrealized gains (losses) on foreign currency translation, net
|
2,524
|
|
|
(7,369
|
)
|
|
9,373
|
|
|||
|
|
|
|
|
|
|
|
|
|||
Total other comprehensive income (loss)
|
686
|
|
|
(10,688
|
)
|
|
44,603
|
|
|||
Comprehensive income
|
404,733
|
|
|
392,105
|
|
|
238,807
|
|
|||
Less: comprehensive income attributable to noncontrolling interests
|
(40,882
|
)
|
|
(23,481
|
)
|
|
(25,045
|
)
|
|||
Comprehensive income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
$
|
363,851
|
|
|
$
|
368,624
|
|
|
$
|
213,762
|
|
|
|
Alexandria Real Estate Equities, Inc.’s Stockholders’ Equity
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
|
|
7.00% Series D
Cumulative Convertible Preferred Stock |
|
6.45% Series E
Cumulative Redeemable Preferred Stock |
|
Number of
Common
Shares
|
|
Common
Stock
|
|
Additional
Paid-In Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive Income
|
|
Noncontrolling
Interests
|
|
Total
Equity
|
|
Redeemable
Noncontrolling
Interests
|
|||||||||||||||||||
Balance as of December 31, 2016
|
|
$
|
86,914
|
|
|
$
|
130,000
|
|
|
87,665,880
|
|
|
$
|
877
|
|
|
$
|
4,672,650
|
|
|
$
|
—
|
|
|
$
|
5,355
|
|
|
$
|
475,175
|
|
|
$
|
5,370,971
|
|
|
$
|
11,307
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
169,093
|
|
|
—
|
|
|
24,053
|
|
|
193,146
|
|
|
1,058
|
|
|||||||||
Total other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,669
|
|
|
(66
|
)
|
|
44,603
|
|
|
—
|
|
|||||||||
Redemption of noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(541
|
)
|
|
(541
|
)
|
|
—
|
|
|||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,505
|
)
|
|
(21,505
|
)
|
|
(856
|
)
|
|||||||||
Contributions from and sales of noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,747
|
|
|
—
|
|
|
—
|
|
|
44,878
|
|
|
52,625
|
|
|
—
|
|
|||||||||
Issuance of common stock
|
|
—
|
|
|
—
|
|
|
11,694,101
|
|
|
117
|
|
|
1,275,280
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,275,397
|
|
|
—
|
|
|||||||||
Issuance pursuant to stock plan
|
|
—
|
|
|
—
|
|
|
423,705
|
|
|
4
|
|
|
42,395
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,399
|
|
|
—
|
|
|||||||||
Repurchases of 7.00% Series D preferred stock
|
|
(12,528
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
391
|
|
|
(5,797
|
)
|
|
—
|
|
|
—
|
|
|
(17,934
|
)
|
|
—
|
|
|||||||||
Redemption of 6.45% Series E preferred stock
|
|
—
|
|
|
(130,000
|
)
|
|
—
|
|
|
—
|
|
|
5,132
|
|
|
(5,482
|
)
|
|
—
|
|
|
—
|
|
|
(130,350
|
)
|
|
—
|
|
|||||||||
Dividends declared on common stock ($3.45 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(329,485
|
)
|
|
—
|
|
|
—
|
|
|
(329,485
|
)
|
|
—
|
|
|||||||||
Dividends declared on preferred stock ($1.75 per share of Series D and $0.403125 per share of Series E)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,666
|
)
|
|
—
|
|
|
—
|
|
|
(7,666
|
)
|
|
—
|
|
|||||||||
Distributions in excess of earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(179,337
|
)
|
|
179,337
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Balance as of December 31, 2017
|
|
74,386
|
|
|
—
|
|
|
99,783,686
|
|
|
998
|
|
|
5,824,258
|
|
|
—
|
|
|
50,024
|
|
|
521,994
|
|
|
6,471,660
|
|
|
11,509
|
|
|||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
379,312
|
|
|
—
|
|
|
22,618
|
|
|
401,930
|
|
|
863
|
|
|||||||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,688
|
)
|
|
—
|
|
|
(10,688
|
)
|
|
—
|
|
|||||||||
Reclassification of net unrealized gains on non-real estate investments upon adoption of new ASU on financial instruments on January 1, 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
140,521
|
|
|
(49,771
|
)
|
|
—
|
|
|
90,750
|
|
|
—
|
|
|||||||||
Redemption of noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,597
|
)
|
|||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,810
|
)
|
|
(29,810
|
)
|
|
(846
|
)
|
|||||||||
Contributions from and sales of noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
257
|
|
|
—
|
|
|
—
|
|
|
27,161
|
|
|
27,418
|
|
|
857
|
|
|||||||||
Issuance of common stock
|
|
—
|
|
|
—
|
|
|
10,915,120
|
|
|
109
|
|
|
1,304,531
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,304,640
|
|
|
—
|
|
|||||||||
Issuance pursuant to stock plan
|
|
—
|
|
|
—
|
|
|
313,010
|
|
|
3
|
|
|
45,975
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45,978
|
|
|
—
|
|
|||||||||
Repurchases of 7.00% Series D preferred stock
|
|
(10,050
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
314
|
|
|
(4,240
|
)
|
|
—
|
|
|
—
|
|
|
(13,976
|
)
|
|
—
|
|
|||||||||
Dividends declared on common stock ($3.73 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(398,914
|
)
|
|
—
|
|
|
—
|
|
|
(398,914
|
)
|
|
—
|
|
|||||||||
Dividends declared on preferred stock ($1.75 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,060
|
)
|
|
—
|
|
|
—
|
|
|
(5,060
|
)
|
|
—
|
|
|||||||||
Reclassification of distributions in excess of earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
111,619
|
|
|
(111,619
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Balance as of December 31, 2018
|
|
$
|
64,336
|
|
|
$
|
—
|
|
|
111,011,816
|
|
|
$
|
1,110
|
|
|
$
|
7,286,954
|
|
|
$
|
—
|
|
|
$
|
(10,435
|
)
|
|
$
|
541,963
|
|
|
$
|
7,883,928
|
|
|
$
|
10,786
|
|
|
|
Alexandria Real Estate Equities, Inc.’s Stockholders’ Equity
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
|
7.00% Series D
Cumulative Convertible Preferred Stock |
|
Number of
Common Shares |
|
Common
Stock |
|
Additional
Paid-In Capital |
|
Retained
Earnings |
|
Accumulated
Other Comprehensive Income (Loss) |
|
Noncontrolling
Interests |
|
Total
Equity |
|
Redeemable
Noncontrolling Interests |
|||||||||||||||||
Balance as of December 31, 2018
|
|
$
|
64,336
|
|
|
111,011,816
|
|
|
$
|
1,110
|
|
|
$
|
7,286,954
|
|
|
$
|
—
|
|
|
$
|
(10,435
|
)
|
|
$
|
541,963
|
|
|
$
|
7,883,928
|
|
|
$
|
10,786
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
363,165
|
|
|
—
|
|
|
40,007
|
|
|
403,172
|
|
|
875
|
|
||||||||
Total other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
686
|
|
|
—
|
|
|
686
|
|
|
—
|
|
||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(47,395
|
)
|
|
(47,395
|
)
|
|
(830
|
)
|
||||||||
Contributions from and sales of noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
381,162
|
|
|
—
|
|
|
—
|
|
|
753,777
|
|
|
1,134,939
|
|
|
1,469
|
|
||||||||
Issuance of common stock
|
|
—
|
|
|
8,723,076
|
|
|
87
|
|
|
1,216,358
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,216,445
|
|
|
—
|
|
||||||||
Issuance pursuant to stock plan
|
|
—
|
|
|
666,836
|
|
|
7
|
|
|
67,906
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,913
|
|
|
—
|
|
||||||||
Taxes paid related to net settlement of equity awards
|
|
—
|
|
|
(179,008
|
)
|
|
(2
|
)
|
|
(25,475
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,477
|
)
|
|
—
|
|
||||||||
Repurchases of 7.00% Series D preferred stock
|
|
(6,875
|
)
|
|
—
|
|
|
—
|
|
|
215
|
|
|
(2,580
|
)
|
|
—
|
|
|
—
|
|
|
(9,240
|
)
|
|
—
|
|
||||||||
Conversion of 7.00% Series D preferred stock
|
|
(57,461
|
)
|
|
577,595
|
|
|
6
|
|
|
57,355
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(100
|
)
|
|
—
|
|
||||||||
Dividends declared on common stock ($4.00 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(463,964
|
)
|
|
—
|
|
|
—
|
|
|
(463,964
|
)
|
|
—
|
|
||||||||
Dividends declared on preferred stock ($1.3125 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,204
|
)
|
|
—
|
|
|
—
|
|
|
(3,204
|
)
|
|
—
|
|
||||||||
Cumulative effect of adjustment upon adoption of new ASU on lease accounting on January 1, 2019
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,525
|
)
|
|
—
|
|
|
—
|
|
|
(3,525
|
)
|
|
—
|
|
||||||||
Reclassification of distributions in excess of earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(110,108
|
)
|
|
110,108
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Balance as of December 31, 2019
|
|
$
|
—
|
|
|
120,800,315
|
|
|
$
|
1,208
|
|
|
$
|
8,874,367
|
|
|
$
|
—
|
|
|
$
|
(9,749
|
)
|
|
$
|
1,288,352
|
|
|
$
|
10,154,178
|
|
|
$
|
12,300
|
|
Alexandria Real Estate Equities, Inc.
Consolidated Statements of Cash Flows
(In thousands)
|
|||||||||||
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Operating Activities
|
|
|
|
|
|
||||||
Net income
|
$
|
404,047
|
|
|
$
|
402,793
|
|
|
$
|
194,204
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
544,612
|
|
|
477,661
|
|
|
416,783
|
|
|||
Loss on early extinguishment of debt
|
47,570
|
|
|
1,122
|
|
|
3,451
|
|
|||
Impairment of real estate
|
12,334
|
|
|
6,311
|
|
|
203
|
|
|||
Gain on sales of real estate – rental properties
|
(474
|
)
|
|
(8,704
|
)
|
|
(270
|
)
|
|||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
(111
|
)
|
|||
Equity in earnings of unconsolidated real estate joint ventures
|
(10,136
|
)
|
|
(43,981
|
)
|
|
(15,426
|
)
|
|||
Distributions of earnings from unconsolidated real estate joint ventures
|
2,796
|
|
|
430
|
|
|
1,618
|
|
|||
Amortization of loan fees
|
9,105
|
|
|
10,271
|
|
|
11,149
|
|
|||
Amortization of debt premiums
|
(3,777
|
)
|
|
(2,406
|
)
|
|
(2,512
|
)
|
|||
Amortization of acquired below-market leases
|
(29,813
|
)
|
|
(21,938
|
)
|
|
(19,055
|
)
|
|||
Deferred rent
|
(104,235
|
)
|
|
(93,883
|
)
|
|
(107,643
|
)
|
|||
Stock compensation expense
|
43,640
|
|
|
35,019
|
|
|
25,610
|
|
|||
Investment income
|
(194,647
|
)
|
|
(136,763
|
)
|
|
(1,329
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Tenant receivables
|
(897
|
)
|
|
435
|
|
|
(502
|
)
|
|||
Deferred leasing costs
|
(54,455
|
)
|
|
(57,088
|
)
|
|
(62,639
|
)
|
|||
Other assets
|
(20,825
|
)
|
|
(20,849
|
)
|
|
(18,222
|
)
|
|||
Accounts payable, accrued expenses, and other liabilities
|
39,012
|
|
|
21,909
|
|
|
25,573
|
|
|||
Net cash provided by operating activities
|
683,857
|
|
|
570,339
|
|
|
450,882
|
|
|||
|
|
|
|
|
|
||||||
Investing Activities
|
|
|
|
|
|
||||||
Proceeds from sales of real estate
|
6,619
|
|
|
20,190
|
|
|
15,432
|
|
|||
Additions to real estate
|
(1,224,541
|
)
|
|
(927,168
|
)
|
|
(893,685
|
)
|
|||
Purchases of real estate
|
(2,259,778
|
)
|
|
(1,037,180
|
)
|
|
(675,584
|
)
|
|||
Deposits for investing activities
|
(18,107
|
)
|
|
(2,000
|
)
|
|
(2,300
|
)
|
|||
Acquisitions of interest in unconsolidated real estate joint ventures
|
—
|
|
|
(35,922
|
)
|
|
(60,291
|
)
|
|||
Investments in unconsolidated real estate joint ventures
|
(102,081
|
)
|
|
(116,008
|
)
|
|
(17,876
|
)
|
|||
Return of capital from unconsolidated real estate joint ventures
|
14
|
|
|
68,592
|
|
|
38,576
|
|
|||
Additions to non-real estate investments
|
(190,778
|
)
|
|
(235,943
|
)
|
|
(171,881
|
)
|
|||
Sales of non-real estate investments
|
147,332
|
|
|
103,679
|
|
|
30,483
|
|
|||
Net cash used in investing activities
|
$
|
(3,641,320
|
)
|
|
$
|
(2,161,760
|
)
|
|
$
|
(1,737,126
|
)
|
Alexandria Real Estate Equities, Inc.
Consolidated Statements of Cash Flows
(In thousands)
|
|||||||||||
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Financing Activities
|
|
|
|
|
|
||||||
Borrowings from secured notes payable
|
$
|
—
|
|
|
$
|
17,784
|
|
|
$
|
153,405
|
|
Repayments of borrowings from secured notes payable
|
(306,199
|
)
|
|
(156,888
|
)
|
|
(396,240
|
)
|
|||
Proceeds from issuance of unsecured senior notes payable
|
2,721,169
|
|
|
899,321
|
|
|
1,023,262
|
|
|||
Repayments of unsecured senior notes payable
|
(950,000
|
)
|
|
—
|
|
|
—
|
|
|||
Borrowings from unsecured senior line of credit
|
5,056,000
|
|
|
4,741,000
|
|
|
3,858,000
|
|
|||
Repayments of borrowings from unsecured senior line of credit
|
(4,880,000
|
)
|
|
(4,583,000
|
)
|
|
(3,836,000
|
)
|
|||
Proceeds from issuance of commercial paper program
|
2,233,000
|
|
|
—
|
|
|
—
|
|
|||
Repayments of borrowings from commercial paper program
|
(2,233,000
|
)
|
|
—
|
|
|
—
|
|
|||
Repayments of borrowings from unsecured senior bank term loan
|
(350,000
|
)
|
|
(200,000
|
)
|
|
(200,000
|
)
|
|||
Premium paid for early extinguishment of debt
|
(41,351
|
)
|
|
—
|
|
|
—
|
|
|||
Payments of loan fees
|
(27,182
|
)
|
|
(19,292
|
)
|
|
(10,019
|
)
|
|||
Taxes paid related to net settlement of equity awards
|
(25,477
|
)
|
|
—
|
|
|
—
|
|
|||
Repurchases of 7.00% Series D cumulative convertible preferred stock
|
(9,240
|
)
|
|
(13,976
|
)
|
|
(17,934
|
)
|
|||
Redemption of 6.45% Series E cumulative redeemable preferred stock
|
—
|
|
|
—
|
|
|
(130,350
|
)
|
|||
Proceeds from issuance of common stock
|
1,216,445
|
|
|
1,293,301
|
|
|
1,275,397
|
|
|||
Dividends on common stock
|
(447,029
|
)
|
|
(380,632
|
)
|
|
(312,131
|
)
|
|||
Dividends on preferred stock
|
(4,141
|
)
|
|
(5,207
|
)
|
|
(9,619
|
)
|
|||
Contributions from and sales of noncontrolling interests
|
1,022,712
|
|
|
28,275
|
|
|
44,931
|
|
|||
Distributions to and purchases of noncontrolling interests
|
(48,225
|
)
|
|
(32,253
|
)
|
|
(22,361
|
)
|
|||
Net cash provided by financing activities
|
2,927,482
|
|
|
1,588,433
|
|
|
1,420,341
|
|
|||
|
|
|
|
|
|
||||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
540
|
|
|
(2,068
|
)
|
|
1,723
|
|
|||
|
|
|
|
|
|
||||||
Net (decrease) increase in cash, cash equivalents, and restricted cash
|
(29,441
|
)
|
|
(5,056
|
)
|
|
135,820
|
|
|||
Cash, cash equivalents, and restricted cash as of the beginning of period
|
272,130
|
|
|
277,186
|
|
|
141,366
|
|
|||
Cash, cash equivalents, and restricted cash as of the end of period
|
$
|
242,689
|
|
|
$
|
272,130
|
|
|
$
|
277,186
|
|
|
|
|
|
|
|
||||||
Supplemental Disclosure and Non-Cash Investing and Financing Activities:
|
|
|
|
|
|
||||||
Cash paid during the period for interest, net of interest capitalized
|
$
|
146,165
|
|
|
$
|
127,093
|
|
|
$
|
112,113
|
|
Change in accrued construction
|
$
|
(24
|
)
|
|
$
|
81,177
|
|
|
$
|
(11,034
|
)
|
Accrued construction for current-period additions to real estate
|
$
|
220,773
|
|
|
$
|
244,147
|
|
|
$
|
179,154
|
|
Assumption of secured notes payable in connection with purchase of properties
|
$
|
(28,200
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Right-of-use asset
|
$
|
269,189
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Lease liability
|
$
|
(275,175
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Payable for purchase of real estate
|
$
|
—
|
|
|
$
|
(65,000
|
)
|
|
$
|
—
|
|
Contribution of real estate to an unconsolidated real estate joint venture
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,998
|
|
Contribution of real estate from noncontrolling interests
|
$
|
115,167
|
|
|
$
|
—
|
|
|
$
|
8,597
|
|
Issuance of common stock for conversion of 7.00% Series D preferred stock
|
$
|
57,461
|
|
|
$
|
—
|
|
|
$
|
—
|
|
1.
|
Organization and basis of presentation
|
2.
|
Summary of significant accounting policies
|
•
|
The entity has a legal structure that has been established to conduct business activities and to hold assets; such entity can be in the form of a partnership, limited liability company, or corporation, among others; and
|
•
|
We have a variable interest in the legal entity – i.e., variable interests that are contractual, such as equity ownership, or other financial interests that change with changes in the fair value of the entity’s net assets.
|
1)
|
The entity does not have sufficient equity to finance its activities without additional subordinated financial support;
|
2)
|
The entity is established with non-substantive voting rights (i.e., the entity deprives the majority economic interest holder(s) of voting rights); or
|
3)
|
The equity holders, as a group, lack the characteristics of a controlling financial interest. Equity holders meet this criterion if they lack any of the following:
|
•
|
The power, through voting rights or similar rights, to direct the activities of the entity that most significantly influence the entity’s economic performance, as evidenced by:
|
•
|
Substantive participating rights in day-to-day management of the entity’s activities; or
|
•
|
Substantive kick-out rights over the party responsible for significant decisions;
|
•
|
The obligation to absorb the entity’s expected losses; or
|
•
|
The right to receive the entity’s expected residual returns.
|
•
|
Participating rights provide the noncontrolling equity holders the ability to direct significant financial and operating decisions made in the ordinary course of business that most significantly influence the entity’s economic performance.
|
•
|
Kick-out rights allow the noncontrolling equity holders to remove the general partner or managing member without cause.
|
2.
|
Summary of significant accounting policies (continued)
|
•
|
Substantially all of the fair value of the gross assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets; or
|
•
|
The integrated set of assets and activities is lacking, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs (i.e., revenue generated before and after the transaction).
|
•
|
The process includes an organized workforce (or includes an acquired contract that provides access to an organized workforce) that is skilled, knowledgeable, and experienced in performing the process;
|
•
|
The process cannot be replaced without significant cost, effort, or delay; or
|
•
|
The process is considered unique or scarce.
|
2.
|
Summary of significant accounting policies (continued)
|
2.
|
Summary of significant accounting policies (continued)
|
2.
|
Summary of significant accounting policies (continued)
|
•
|
Investments in publicly traded companies are classified as investments with readily determinable fair values. These investments are carried at fair value, with changes in fair value recognized in net income. The fair values for our investments in publicly traded companies are determined based on sales prices/quotes available on securities exchanges.
|
•
|
Investments in privately held entities without readily determinable fair values fall into two categories:
|
•
|
Investments in privately held entities that report NAV per share, such as our privately held investments in limited partnerships, are carried at fair value using NAV as a practical expedient, with changes in fair value recognized in net income. We use NAV per share reported by limited partnerships generally without adjustment, unless we are aware of information indicating that the NAV per share reported by a limited partnership does not accurately reflect the fair value of the investment at our reporting date. We disclose the timing of liquidation of an investee’s assets and the date when redemption restrictions will lapse (or indicate if this timing is unknown) if the investee has communicated this information to us or has announced it publicly.
|
2.
|
Summary of significant accounting policies (continued)
|
•
|
Investments in privately held entities that do not report NAV per share are accounted for using a measurement alternative under which these investments are measured at cost, adjusted for observable price changes and impairments, with changes recognized in net income.
|
|
|
Year Ended December 31, 2019
|
||
Income from rentals:
|
|
|
||
Revenues subject to the new lease accounting standard:
|
|
|
||
Operating leases
|
|
$
|
1,465,692
|
|
Direct financing lease
|
|
2,421
|
|
|
Revenues subject to the new lease accounting standard
|
|
1,468,113
|
|
|
Revenues subject to the revenue recognition accounting standard
|
|
48,751
|
|
|
Income from rentals
|
|
1,516,864
|
|
|
Other income
|
|
14,432
|
|
|
Total revenues
|
|
$
|
1,531,296
|
|
2.
|
Summary of significant accounting policies (continued)
|
•
|
Package of practical expedients – requires us not to reevaluate our existing or expired leases as of January 1, 2019, under the new lease accounting standard.
|
•
|
Optional transition method practical expedient – requires us to apply the new lease accounting standard prospectively from the adoption date of January 1, 2019.
|
•
|
Single component accounting policy – requires us to account for lease and nonlease components within a lease under the new lease accounting standard if certain criteria are met.
|
•
|
Land easements practical expedient – requires us to continue to account for land easements existing as of January 1, 2019, under the accounting standards applied to them prior to January 1, 2019.
|
•
|
Short-term lease accounting policy – requires us not to record the related lease liabilities and right-of-use assets for operating leases in which we are the lessee with a term of 12 months or less.
|
•
|
Whether any contracts effective prior to January 1, 2019, are leases or contain leases. This practical expedient is primarily applicable to entities that have contracts containing embedded leases. As of December 31, 2018, we had no such contracts; therefore, this practical expedient had no effect on us.
|
•
|
The lease classification for any leases that commenced prior to January 1, 2019. Our election of the package of practical expedients requires us not to revisit the classification of our leases that commenced prior to January 1, 2019. For example, all of our leases that were classified as operating leases in accordance with the lease accounting standards in effect prior to January 1, 2019, continue to be classified as operating leases after adoption of the new lease accounting standard.
|
•
|
Previously capitalized initial direct costs for any leases that commenced prior to January 1, 2019. Our election of the package of practical expedients and the optional transition method requires us not to reassess whether initial direct leasing costs capitalized prior to the adoption of the new lease accounting standard in connection with the leases that commenced prior to January 1, 2019, qualify for capitalization under the new lease accounting standard.
|
2.
|
Summary of significant accounting policies (continued)
|
(i)
|
One party (lessor) must hold an identified asset;
|
(ii)
|
The counterparty (lessee) must have the right to obtain substantially all of the economic benefits from the use of the asset throughout the period of the contract; and
|
(iii)
|
The counterparty (lessee) must have the right to direct the use of the identified asset throughout the period of the contract.
|
(i)
|
Ownership is transferred from lessor to lessee by the end of the lease term;
|
(ii)
|
An option to purchase is reasonably certain to be exercised;
|
(iii)
|
The lease term is for the major part of the underlying asset’s remaining economic life;
|
(iv)
|
The present value of lease payments equals or exceeds substantially all of the fair value of the underlying asset; or
|
(v)
|
The underlying asset is specialized and is expected to have no alternative use at the end of the lease term.
|
2.
|
Summary of significant accounting policies (continued)
|
(i)
|
The timing and pattern of transfer of the lease component and the nonlease component(s) are the same; and
|
(ii)
|
The lease component would be classified as an operating lease if it were accounted for separately.
|
|
|
Year Ended
|
||||||
|
|
2018
|
|
2017
|
||||
Rental revenues (presentation prior to January 1, 2019)
|
|
$
|
1,010,718
|
|
|
$
|
863,181
|
|
Tenant recoveries (presentation prior to January 1, 2019)
|
|
304,063
|
|
|
259,144
|
|
||
Income from rentals (presentation effective January 1, 2019)
|
|
$
|
1,314,781
|
|
|
$
|
1,122,325
|
|
2.
|
Summary of significant accounting policies (continued)
|
2.
|
Summary of significant accounting policies (continued)
|
2.
|
Summary of significant accounting policies (continued)
|
2.
|
Summary of significant accounting policies (continued)
|
3.
|
Investments in real estate
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Rental properties:
|
|
|
|
|
||||
Land (related to rental properties)
|
|
$
|
2,225,785
|
|
|
$
|
1,625,349
|
|
Buildings and building improvements
|
|
11,775,132
|
|
|
9,986,635
|
|
||
Other improvements
|
|
1,277,862
|
|
|
976,627
|
|
||
Rental properties
|
|
15,278,779
|
|
|
12,588,611
|
|
||
Development and redevelopment of new Class A properties:
|
|
|
|
|
||||
Development and redevelopment projects
|
|
2,057,084
|
|
|
1,460,814
|
|
||
Future development projects
|
|
182,746
|
|
|
98,802
|
|
||
Gross investments in real estate
|
|
17,518,609
|
|
|
14,148,227
|
|
||
Less: accumulated depreciation
|
|
(2,704,657
|
)
|
|
(2,263,797
|
)
|
||
Net investments in real estate – North America
|
|
14,813,952
|
|
|
11,884,430
|
|
||
Net investments in real estate – Asia
|
|
30,086
|
|
|
29,263
|
|
||
Investments in real estate
|
|
$
|
14,844,038
|
|
|
$
|
11,913,693
|
|
|
|
|
|
Square Footage
|
|
|
|
||||||||||||
Market
|
|
Number of Properties
|
|
Future Development
|
|
Active Redevelopment
|
|
Operating With Future Development/Redevelopment
|
|
Operating
|
|
Purchase Price
|
|
||||||
Greater Boston
|
|
12
|
|
668,000
|
|
|
153,157
|
|
|
154,855
|
|
|
615,439
|
|
|
$
|
858,600
|
|
|
San Francisco
|
|
8
|
|
—
|
|
|
347,912
|
|
|
478,000
|
|
|
247,770
|
|
|
735,450
|
|
|
|
New York City
|
|
—
|
|
135,938
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,000
|
|
|
|
San Diego
|
|
16
|
|
869,000
|
|
|
—
|
|
|
93,220
|
|
|
912,419
|
|
|
474,214
|
|
(1)
|
|
Seattle
|
|
1
|
|
188,400
|
|
|
—
|
|
|
18,680
|
|
|
—
|
|
|
28,500
|
|
|
|
Maryland
|
|
3
|
|
435,000
|
|
|
—
|
|
|
—
|
|
|
138,938
|
|
|
76,130
|
|
|
|
Other
|
|
7
|
|
54,000
|
|
|
—
|
|
|
134,678
|
|
|
34,534
|
|
|
77,000
|
|
|
|
Year ended December 31, 2019
|
|
47
|
|
2,350,338
|
|
|
501,069
|
|
|
879,433
|
|
|
1,949,100
|
|
|
$
|
2,274,894
|
|
|
(1)
|
Includes $65.0 million paid in January 2019 for two properties at 10260 Campus Point Drive and 4161 Campus Point Court that we acquired in December 2018. The total purchase price was $80.0 million, of which $15.0 million was paid in December 2018. Also includes $114.8 million related to our partner’s noncontrolling interest in the consolidated real estate joint venture at 4224/4242 Campus Point Court and 10210 Campus Point Drive to reflect the full contractual purchase price.
|
3.
|
Investments in real estate (continued)
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Acquired below-market leases
|
|
$
|
326,255
|
|
|
$
|
236,026
|
|
Accumulated amortization
|
|
(131,482
|
)
|
|
(101,218
|
)
|
||
|
|
$
|
194,773
|
|
|
$
|
134,808
|
|
Year
|
|
Amount
|
||
2020
|
|
$
|
44,269
|
|
2021
|
|
20,698
|
|
|
2022
|
|
19,503
|
|
|
2023
|
|
18,635
|
|
|
2024
|
|
16,940
|
|
|
Thereafter
|
|
74,728
|
|
|
Total
|
|
$
|
194,773
|
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Acquired in-place leases
|
|
$
|
426,280
|
|
|
$
|
229,095
|
|
Accumulated amortization
|
|
(144,630
|
)
|
|
(96,189
|
)
|
||
|
|
$
|
281,650
|
|
|
$
|
132,906
|
|
3.
|
Investments in real estate (continued)
|
Year
|
|
Amount
|
||
2020
|
|
$
|
54,757
|
|
2021
|
|
49,878
|
|
|
2022
|
|
37,006
|
|
|
2023
|
|
31,885
|
|
|
2024
|
|
24,001
|
|
|
Thereafter
|
|
84,123
|
|
|
Total
|
|
$
|
281,650
|
|
4.
|
Consolidated and unconsolidated real estate joint ventures
|
|
Property
|
|
Market
|
|
Submarket
|
|
Our Ownership Interest (1)
|
|||
Consolidated joint ventures(2):
|
|
|
|
|
|
|
|
|
||
|
225 Binney Street
|
|
Greater Boston
|
|
Cambridge
|
|
|
30.0
|
%
|
|
|
75/125 Binney Street
|
|
Greater Boston
|
|
Cambridge
|
|
|
40.0
|
%
|
|
|
409 and 499 Illinois Street
|
|
San Francisco
|
|
Mission Bay/SoMa
|
|
|
60.0
|
%
|
|
|
1500 Owens Street
|
|
San Francisco
|
|
Mission Bay/SoMa
|
|
|
50.1
|
%
|
|
|
500 Forbes Boulevard
|
|
San Francisco
|
|
South San Francisco
|
|
|
10.0
|
%
|
|
|
Campus Pointe by Alexandria(3)
|
|
San Diego
|
|
University Town Center
|
|
|
55.0
|
%
|
|
|
5200 Illumina Way
|
|
San Diego
|
|
University Town Center
|
|
|
51.0
|
%
|
|
|
9625 Towne Centre Drive
|
|
San Diego
|
|
University Town Center
|
|
|
50.1
|
%
|
|
|
SD Tech by Alexandria
|
|
San Diego
|
|
Sorrento Mesa
|
|
|
50.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Unconsolidated joint ventures(2):
|
|
|
|
|
|
|
|
|
||
|
Menlo Gateway
|
|
San Francisco
|
|
Greater Stanford
|
|
|
49.0
|
%
|
|
|
1401/1413 Research Boulevard
|
|
Maryland
|
|
Rockville
|
|
|
65.0
|
%
|
(4)
|
|
704 Quince Orchard Road
|
|
Maryland
|
|
Gaithersburg
|
|
|
56.8
|
%
|
(4)
|
|
1655 and 1725 Third Street
|
|
San Francisco
|
|
Mission Bay/SoMa
|
|
|
10.0
|
%
|
|
(1)
|
Refer to the table on the next page that shows our categorization of our existing significant joint ventures under the consolidation framework.
|
(2)
|
In addition to the consolidated real estate joint ventures listed, various partners hold insignificant noncontrolling interests in six other joint ventures in North America and we hold an interest in one other insignificant unconsolidated real estate joint venture in North America.
|
(3)
|
Excludes 9880 Campus Point Drive in our University Town Center submarket.
|
(4)
|
Represents our ownership interest; our voting interest is limited to 50%.
|
4.
|
Consolidated and unconsolidated real estate joint ventures (continued)
|
Property
|
|
Consolidation Model
|
|
Voting Interest
|
|
Consolidation Analysis
|
|
Conclusion
|
|
|
|
|
|
|
|
|
|
|
|
225 Binney Street
|
|
VIE model
|
|
Not applicable under the VIE model
|
|
We have:
|
|
Consolidated
|
|
75/125 Binney Street
|
|
|
|
(i)
|
The power to direct the activities of the joint venture that most significantly affect its economic performance; and
|
|
|||
409 and 499 Illinois Street
|
|
|
|||||||
1500 Owens Street
|
|
|
|||||||
500 Forbes Boulevard
|
|
|
|
||||||
Campus Pointe by Alexandria
|
|
(ii)
|
Benefits that can be significant to the joint venture.
|
||||||
5200 Illumina Way
|
|
|
|||||||
9625 Towne Centre Drive
|
|
Therefore, we are the primary beneficiary of each VIE
|
|||||||
SD Tech by Alexandria
|
|
|
|||||||
Menlo Gateway
|
|
|
We do not control the joint venture and are therefore not the primary beneficiary
|
Equity method of accounting
|
|||||
1401/1413 Research Boulevard
|
|
||||||||
704 Quince Orchard Road
|
|
Voting model
|
|
Does not exceed 50%
|
Our voting interest is 50% or less
|
|
|||
1655 and 1725 Third Street
|
|
4.
|
Consolidated and unconsolidated real estate joint ventures (continued)
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Investments in real estate
|
|
$
|
2,678,476
|
|
|
$
|
1,108,385
|
|
Cash and cash equivalents
|
|
81,021
|
|
|
42,178
|
|
||
Other assets
|
|
280,343
|
|
|
74,901
|
|
||
Total assets
|
|
$
|
3,039,840
|
|
|
$
|
1,225,464
|
|
|
|
|
|
|
||||
Secured notes payable
|
|
$
|
—
|
|
|
$
|
—
|
|
Other liabilities
|
|
149,471
|
|
|
59,336
|
|
||
Total liabilities
|
|
149,471
|
|
|
59,336
|
|
||
Redeemable noncontrolling interests
|
|
2,388
|
|
|
874
|
|
||
Alexandria Real Estate Equities, Inc.’s share of equity
|
|
1,600,729
|
|
|
624,349
|
|
||
Noncontrolling interests’ share of equity
|
|
1,287,252
|
|
|
540,905
|
|
||
Total liabilities and equity
|
|
$
|
3,039,840
|
|
|
$
|
1,225,464
|
|
|
|
|
|
|
4.
|
Consolidated and unconsolidated real estate joint ventures (continued)
|
|
|
December 31,
|
||||||
Property
|
|
2019
|
|
2018
|
||||
Menlo Gateway
|
|
$
|
288,408
|
|
|
$
|
186,504
|
|
1401/1413 Research Boulevard
|
|
7,696
|
|
|
8,197
|
|
||
704 Quince Orchard Road
|
|
4,748
|
|
|
4,547
|
|
||
1655 and 1725 Third Street
|
|
37,016
|
|
|
34,917
|
|
||
Other
|
|
9,022
|
|
|
3,342
|
|
||
|
|
$
|
346,890
|
|
|
$
|
237,507
|
|
|
|
|
|
Maturity Date
|
|
Stated Rate
|
|
Interest Rate(1)
|
|
100% at Joint Venture Level
|
|
||||||||
Unconsolidated Joint Venture
|
|
Our Share
|
|
|
|
|
Debt Balance(2)
|
|
Remaining Commitments
|
|
|||||||||
1401/1413 Research Boulevard
|
|
65.0%
|
|
|
5/17/20
|
|
|
L+2.50%
|
|
5.18%
|
|
$
|
26,158
|
|
|
$
|
2,619
|
|
|
1655 and 1725 Third Street
|
|
10.0%
|
|
|
6/29/21
|
|
|
L+3.70%
|
|
5.41%
|
|
309,275
|
|
|
65,725
|
|
|
||
704 Quince Orchard Road
|
|
56.8%
|
|
|
3/16/23
|
|
|
L+1.95%
|
|
3.94%
|
|
9,172
|
|
|
5,709
|
|
|
||
Menlo Gateway, Phase II
|
|
49.0%
|
|
|
5/1/35
|
|
|
4.53%
|
|
4.59%
|
|
56,321
|
|
|
99,529
|
|
|
||
Menlo Gateway, Phase I
|
|
49.0%
|
|
|
8/10/35
|
|
|
4.15%
|
|
4.18%
|
|
142,101
|
|
|
—
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
$
|
543,027
|
|
|
$
|
173,582
|
|
|
(1)
|
Includes interest expense and amortization of loan fees.
|
(2)
|
Represents outstanding principal, net of unamortized deferred financing costs, as of December 31, 2019.
|
•
|
A description of the nature of leases, including terms for any variable payments, options to extend or terminate, and options to purchase the underlying asset;
|
•
|
Tabular presentation of undiscounted cash flows to be received over the next five years and thereafter separately for operating leases and direct financing leases;
|
•
|
The amount of lease income and its location on the statements of operations;
|
•
|
Income classified separately for operating leases and direct financing leases; and
|
•
|
Our risk management strategy to mitigate declines in residual value of the leased assets.
|
•
|
A description of the nature of leases, including terms for any variable payments, options to extend or terminate, and options to purchase the underlying asset;
|
•
|
The amounts of lease liabilities and corresponding right-of-use assets and their respective locations in the balance sheet;
|
•
|
The weighted-average remaining lease term and weighted-average discount rate of leases;
|
•
|
Tabular presentation of undiscounted cash flows of our remaining lease payment obligations over the next five years and thereafter; and
|
•
|
Total lease costs, including cash paid, amounts expensed, and amounts capitalized.
|
5.
|
Leases (continued)
|
Year
|
|
Amount
|
||
2020
|
|
$
|
1,074,698
|
|
2021
|
|
1,090,837
|
|
|
2022
|
|
1,076,898
|
|
|
2023
|
|
1,024,652
|
|
|
2024
|
|
948,223
|
|
|
Thereafter
|
|
6,238,082
|
|
|
Total
|
|
$
|
11,453,390
|
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Gross investment in direct financing lease
|
|
$
|
260,457
|
|
|
$
|
262,111
|
|
Less: unearned income
|
|
(220,541
|
)
|
|
(222,962
|
)
|
||
Net investment in direct financing lease
|
|
$
|
39,916
|
|
|
$
|
39,149
|
|
5.
|
Leases (continued)
|
Year
|
|
Total
|
||
2020
|
|
$
|
1,705
|
|
2021
|
|
1,756
|
|
|
2022
|
|
1,809
|
|
|
2023
|
|
1,863
|
|
|
2024
|
|
1,919
|
|
|
Thereafter
|
|
251,405
|
|
|
Total
|
|
$
|
260,457
|
|
|
|
Year Ended December 31, 2019
|
||
Income from rentals:
|
|
|
||
Revenues subject to the new lease accounting standard:
|
|
|
||
Operating leases
|
|
$
|
1,465,692
|
|
Direct financing lease
|
|
2,421
|
|
|
Revenues subject to the new lease accounting standard
|
|
1,468,113
|
|
|
Revenues subject to the revenue recognition accounting standard
|
|
48,751
|
|
|
Income from rentals
|
|
$
|
1,516,864
|
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Deferred leasing costs
|
|
$
|
631,416
|
|
|
$
|
557,791
|
|
Accumulated amortization
|
|
(361,373
|
)
|
|
(318,721
|
)
|
||
Deferred leasing costs, net
|
|
$
|
270,043
|
|
|
$
|
239,070
|
|
5.
|
Leases (continued)
|
Year
|
|
Total
|
||
2020
|
|
$
|
15,132
|
|
2021
|
|
15,931
|
|
|
2022
|
|
16,467
|
|
|
2023
|
|
16,628
|
|
|
2024
|
|
16,857
|
|
|
Thereafter
|
|
618,924
|
|
|
Total future payments under our operating leases in which we are the lessee
|
|
699,939
|
|
|
Effect of discounting
|
|
(428,131
|
)
|
|
Operating lease liability
|
|
$
|
271,808
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Gross operating lease costs
|
|
$
|
19,740
|
|
|
$
|
16,102
|
|
|
$
|
14,307
|
|
Capitalized lease costs
|
|
(1,452
|
)
|
|
(340
|
)
|
|
(340
|
)
|
|||
Expenses for operating leases in which we are the lessee
|
|
$
|
18,288
|
|
|
$
|
15,762
|
|
|
$
|
13,967
|
|
|
|
|
|
|
|
|
6.
|
Cash, cash equivalents, and restricted cash
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Cash and cash equivalents
|
$
|
189,681
|
|
|
$
|
234,181
|
|
Restricted cash:
|
|
|
|
||||
Funds held in trust under the terms of certain secured notes payable
|
24,331
|
|
|
22,681
|
|
||
Funds held in escrow related to construction projects and investing activities
|
23,252
|
|
|
10,558
|
|
||
Other
|
5,425
|
|
|
4,710
|
|
||
|
53,008
|
|
|
37,949
|
|
||
Total
|
$
|
242,689
|
|
|
$
|
272,130
|
|
7.
|
Investments
|
•
|
Investments in publicly traded companies are presented at fair value in our consolidated balance sheet, with changes in fair value recognized in net income.
|
•
|
Investments in privately held entities without readily determinable fair values previously accounted for under the cost method are accounted for as follows:
|
•
|
Investments in privately held entities that report NAV are presented at fair value using NAV as a practical expedient, with changes in fair value recognized in net income. We use NAV reported by limited partnerships generally without adjustment, unless we are aware of information indicating that the NAV reported by a limited partnership does not accurately reflect the fair value of the investment at our reporting date.
|
•
|
Investments in privately held entities that do not report NAV are carried at cost, adjusted for observable price changes and impairments, with changes recognized in net income. These investments continue to be evaluated on the basis of a qualitative assessment for indicators of impairment by utilizing the same monitoring criteria described in the “Investments” section in Note 2 – “Summary of Significant Accounting Policies” to our consolidated financial statements, and by monitoring the presence of the following impairment indicators: (i) a significant deterioration in the earnings performance, credit rating, asset quality, or business prospects of the investee; (ii) a significant adverse change in the regulatory, economic, or technological environment of the investee, (iii) a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates, (iv) significant concerns about the investee’s ability to continue as a going concern. If such indicators are present, we are required to estimate the investment’s fair value and immediately recognize an impairment loss, without consideration as to whether the impairment is other-than-temporary, in an amount equal to the investment’s carrying value in excess of its estimated fair value.
|
•
|
Investments in privately held entities continue to require accounting under the equity method unless our interest in the entity is deemed to be so minor that we have virtually no influence over the entity’s operating and financial policies. Under the equity method of accounting, we initially recognize our investment at cost and adjust the carrying amount of the investment to recognize our share of the earnings or losses of the investee subsequent to the date of our investment. We had no investments accounted for under the equity method as of December 31, 2019.
|
7.
|
Investments (continued)
|
|
December 31, 2019
|
||||||||||
|
Cost
|
|
Adjustments
|
|
Carrying Amount
|
||||||
Investments:
|
|
|
|
|
|
||||||
Publicly traded companies
|
$
|
148,109
|
|
|
$
|
170,528
|
|
|
$
|
318,637
|
|
Entities that report NAV
|
271,276
|
|
|
162,626
|
|
|
433,902
|
|
|||
Entities that do not report NAV:
|
|
|
|
|
|
||||||
Entities with observable price changes
|
42,045
|
|
|
68,489
|
|
|
110,534
|
|
|||
Entities without observable price changes
|
277,521
|
|
|
—
|
|
|
277,521
|
|
|||
Total investments
|
$
|
738,951
|
|
|
$
|
401,643
|
|
|
$
|
1,140,594
|
|
|
December 31, 2018
|
||||||||||
|
Cost
|
|
Adjustments
|
|
Carrying Amount
|
||||||
Investments:
|
|
|
|
|
|
||||||
Publicly traded companies
|
$
|
121,121
|
|
|
$
|
62,884
|
|
|
$
|
184,005
|
|
Entities that report NAV
|
204,646
|
|
|
113,159
|
|
|
317,805
|
|
|||
Entities that do not report NAV:
|
|
|
|
|
|
||||||
Entities with observable price changes
|
39,421
|
|
|
64,112
|
|
|
103,533
|
|
|||
Entities without observable price changes
|
286,921
|
|
|
—
|
|
|
286,921
|
|
|||
Total investments
|
$
|
652,109
|
|
|
$
|
240,155
|
|
|
$
|
892,264
|
|
7.
|
Investments (continued)
|
|
|
Year Ended December 31, 2019
|
||||||||||
|
|
Unrealized
Gains (Losses) |
|
Realized
Gains (Losses)
|
|
Total
|
||||||
Investments held at December 31, 2019:
|
|
|
|
|
|
|
||||||
Publicly traded companies
|
|
$
|
130,802
|
|
|
$
|
—
|
|
|
$
|
130,802
|
|
Entities that report NAV
|
|
49,440
|
|
|
—
|
|
|
49,440
|
|
|||
Entities that do not report NAV, held at period end
|
|
4,378
|
|
|
(17,124
|
)
|
|
(12,746
|
)
|
|||
Total investments held at December 31, 2019
|
|
184,620
|
|
|
(17,124
|
)
|
|
167,496
|
|
|||
Investment dispositions during the year ended December 31, 2019:
|
|
|
|
|
|
|
||||||
Recognized in the current period
|
|
—
|
|
|
27,151
|
|
|
27,151
|
|
|||
Previously recognized gains
|
|
(23,131
|
)
|
|
23,131
|
|
|
—
|
|
|||
Total investment dispositions during the year ended December 31, 2019
|
|
(23,131
|
)
|
|
50,282
|
|
|
27,151
|
|
|||
Investment income
|
|
$
|
161,489
|
|
|
$
|
33,158
|
|
|
$
|
194,647
|
|
|
|
Year Ended December 31, 2018
|
||||||||||
|
|
Unrealized Gains
|
|
Realized (Losses) Gains
|
|
Total
|
||||||
Investments held at December 31, 2018:
|
|
|
|
|
|
|
||||||
Publicly traded companies
|
|
$
|
27,944
|
|
|
$
|
—
|
|
|
$
|
27,944
|
|
Entities that report NAV
|
|
22,389
|
|
|
—
|
|
|
22,389
|
|
|||
Entities that do not report NAV, held at period end
|
|
64,112
|
|
|
(5,483
|
)
|
|
58,629
|
|
|||
Total investments held at December 31, 2018
|
|
114,445
|
|
|
(5,483
|
)
|
|
108,962
|
|
|||
Investment dispositions during the year ended December 31, 2018:
|
|
|
|
|
|
|
||||||
Recognized in the current period
|
|
—
|
|
|
27,801
|
|
|
27,801
|
|
|||
Previously recognized gains
|
|
(14,811
|
)
|
|
14,811
|
|
|
—
|
|
|||
Total investment dispositions during the year ended December 31, 2018
|
|
(14,811
|
)
|
|
42,612
|
|
|
27,801
|
|
|||
Investment income
|
|
$
|
99,634
|
|
|
$
|
37,129
|
|
|
$
|
136,763
|
|
8.
|
Other assets
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Acquired in-place leases
|
$
|
281,650
|
|
|
$
|
132,906
|
|
Acquired below-market leases in which we are the lessee(1)
|
—
|
|
|
17,434
|
|
||
Deferred compensation plan
|
22,225
|
|
|
19,238
|
|
||
Deferred financing costs – unsecured senior line of credit
|
13,064
|
|
|
16,060
|
|
||
Deposits
|
31,028
|
|
|
12,974
|
|
||
Furniture, fixtures, and equipment
|
23,031
|
|
|
14,787
|
|
||
Interest rate hedge assets
|
—
|
|
|
2,606
|
|
||
Net investment in direct financing lease
|
39,916
|
|
|
39,149
|
|
||
Notes receivable
|
435
|
|
|
528
|
|
||
Operating lease right-of-use asset(1)
|
264,709
|
|
|
—
|
|
||
Other assets
|
32,040
|
|
|
19,861
|
|
||
Prepaid expenses
|
11,324
|
|
|
13,690
|
|
||
Property, plant, and equipment
|
174,292
|
|
|
81,024
|
|
||
Total
|
$
|
893,714
|
|
|
$
|
370,257
|
|
(1)
|
Upon the adoption of new lease accounting standards on January 1, 2019, the balance related to the acquired below-market leases in which we are the lessee was included in the calculation of our operating lease right-of-use asset. Refer to Note 2 – “Summary of Significant Accounting Policies” and Note 5 – “Leases” to our consolidated financial statements for additional information.
|
9.
|
Fair value measurements
|
9.
|
Fair value measurements (continued)
|
|
|
|
|
December 31, 2019
|
||||||||||||
Description
|
|
Total
|
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Investments in publicly traded companies
|
|
$
|
318,637
|
|
|
$
|
318,637
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
December 31, 2018
|
||||||||||||
Description
|
|
Total
|
|
Quoted Prices in
Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Investments in publicly traded companies
|
|
$
|
184,005
|
|
|
$
|
184,005
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest rate hedge agreements
|
|
$
|
2,606
|
|
|
$
|
—
|
|
|
$
|
2,606
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate hedge agreements
|
|
$
|
768
|
|
|
$
|
—
|
|
|
$
|
768
|
|
|
$
|
—
|
|
9.
|
Fair value measurements (continued)
|
|
December 31,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
|
Book Value
|
|
Fair Value
|
|
Book Value
|
|
Fair Value
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Secured notes payable
|
$
|
349,352
|
|
|
$
|
363,344
|
|
|
$
|
630,547
|
|
|
$
|
638,860
|
|
Unsecured senior notes payable
|
$
|
6,044,127
|
|
|
$
|
6,571,668
|
|
|
$
|
4,292,293
|
|
|
$
|
4,288,335
|
|
Unsecured senior line of credit
|
$
|
384,000
|
|
|
$
|
383,928
|
|
|
$
|
208,000
|
|
|
$
|
208,106
|
|
Unsecured senior bank term loan
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
347,415
|
|
|
$
|
350,240
|
|
10.
|
Secured and unsecured senior debt
|
|
Fixed Rate Debt
|
|
Variable-Rate Debt
|
|
|
|
|
|
Weighted-Average
|
|
||||||||||
|
|
|
|
|
|
|
Interest Rate(1)
|
|
Remaining Term
(in years)
|
|
||||||||||
|
|
|
Total
|
|
Percentage
|
|
|
|
||||||||||||
Secured notes payable
|
$
|
349,352
|
|
|
$
|
—
|
|
|
$
|
349,352
|
|
|
5.2
|
%
|
|
3.57
|
%
|
|
4.0
|
|
Unsecured senior notes payable
|
6,044,127
|
|
|
—
|
|
|
6,044,127
|
|
|
89.1
|
|
|
3.99
|
|
|
11.2
|
|
|||
Commercial paper program
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
N/A
|
|
|
N/A
|
|
|||
$2.2 billion unsecured senior line of credit
|
—
|
|
|
384,000
|
|
|
384,000
|
|
|
5.7
|
|
|
2.89
|
|
|
4.1
|
|
|||
Total/weighted average
|
$
|
6,393,479
|
|
|
$
|
384,000
|
|
|
$
|
6,777,479
|
|
|
100.0
|
%
|
|
3.91
|
%
|
|
10.4
|
|
Percentage of total debt
|
94
|
%
|
|
6
|
%
|
|
100
|
%
|
|
|
|
|
|
|
|
(1)
|
Represents the weighted-average interest rate as of the end of the applicable period, including amortization of loan fees, amortization of debt premiums (discounts), and other bank fees.
|
10.
|
Secured and unsecured senior debt (continued)
|
|
|
Stated
Rate |
|
Interest Rate (1)
|
|
Maturity Date (2)
|
|
Principal Payments Remaining for the Periods Ending December 31,
|
|
|
|
Unamortized (Deferred Financing Cost), (Discount) Premium
|
|
|
|
||||||||||||||||||||||||||||||
Debt
|
|
|
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
Thereafter
|
|
Principal
|
|
|
Total
|
|
||||||||||||||||||||||||
Secured notes payable
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
San Diego
|
|
4.66
|
%
|
|
4.90
|
%
|
|
1/1/23
|
|
$
|
1,621
|
|
|
$
|
1,852
|
|
|
$
|
1,942
|
|
|
$
|
26,259
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
31,674
|
|
|
$
|
(198
|
)
|
|
$
|
31,476
|
|
|
Greater Boston
|
|
3.93
|
%
|
|
3.19
|
|
|
3/10/23
|
|
1,565
|
|
|
1,629
|
|
|
1,693
|
|
|
74,517
|
|
|
—
|
|
|
—
|
|
|
79,404
|
|
|
1,771
|
|
|
81,175
|
|
|
|||||||||
Greater Boston
|
|
4.82
|
%
|
|
3.40
|
|
|
2/6/24
|
|
3,207
|
|
|
3,394
|
|
|
3,564
|
|
|
3,742
|
|
|
183,527
|
|
|
—
|
|
|
197,434
|
|
|
10,978
|
|
|
208,412
|
|
|
|||||||||
San Francisco
|
|
4.14
|
%
|
|
4.42
|
|
|
7/1/26
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28,200
|
|
|
28,200
|
|
|
(639
|
)
|
|
27,561
|
|
|
|||||||||
San Francisco
|
|
6.50
|
%
|
|
6.50
|
|
|
7/1/36
|
|
25
|
|
|
26
|
|
|
28
|
|
|
30
|
|
|
32
|
|
|
587
|
|
|
728
|
|
|
—
|
|
|
728
|
|
|
|||||||||
Secured debt weighted-average interest rate/subtotal
|
|
4.55
|
%
|
|
3.57
|
|
|
|
|
6,418
|
|
|
6,901
|
|
|
7,227
|
|
|
104,548
|
|
|
183,559
|
|
|
28,787
|
|
|
337,440
|
|
|
11,912
|
|
|
349,352
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Commercial paper program(3)
|
|
N/A
|
|
|
N/A
|
|
(3)
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||||||
$2.2 billion unsecured senior line of credit
|
|
L+0.825
|
%
|
|
2.89
|
|
|
1/28/24
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
384,000
|
|
|
—
|
|
|
384,000
|
|
|
—
|
|
|
384,000
|
|
|
|||||||||
Unsecured senior notes payable
|
|
3.90
|
%
|
|
4.04
|
|
|
6/15/23
|
|
—
|
|
|
—
|
|
|
—
|
|
|
500,000
|
|
|
—
|
|
|
—
|
|
|
500,000
|
|
|
(2,065
|
)
|
|
497,935
|
|
|
|||||||||
Unsecured senior notes payable – green bond
|
|
4.00
|
%
|
|
4.03
|
|
|
1/15/24
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
650,000
|
|
|
—
|
|
|
650,000
|
|
|
(548
|
)
|
|
649,452
|
|
|
|||||||||
Unsecured senior notes payable
|
|
3.45
|
%
|
|
3.62
|
|
|
4/30/25
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
600,000
|
|
|
600,000
|
|
|
(4,667
|
)
|
|
595,333
|
|
|
|||||||||
Unsecured senior notes payable
|
|
4.30
|
%
|
|
4.50
|
|
|
1/15/26
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
300,000
|
|
|
300,000
|
|
|
(2,942
|
)
|
|
297,058
|
|
|
|||||||||
Unsecured senior notes payable – green bond
|
|
3.80
|
%
|
|
3.96
|
|
|
4/15/26
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
350,000
|
|
|
350,000
|
|
|
(3,081
|
)
|
|
346,919
|
|
|
|||||||||
Unsecured senior notes payable
|
|
3.95
|
%
|
|
4.13
|
|
|
1/15/27
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
350,000
|
|
|
350,000
|
|
|
(3,552
|
)
|
|
346,448
|
|
|
|||||||||
Unsecured senior notes payable
|
|
3.95
|
%
|
|
4.07
|
|
|
1/15/28
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
425,000
|
|
|
425,000
|
|
|
(3,403
|
)
|
|
421,597
|
|
|
|||||||||
Unsecured senior notes payable
|
|
4.50
|
%
|
|
4.60
|
|
|
7/30/29
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
300,000
|
|
|
300,000
|
|
|
(2,126
|
)
|
|
297,874
|
|
|
|||||||||
Unsecured senior notes payable
|
|
2.75
|
%
|
|
2.87
|
|
|
12/15/29
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
400,000
|
|
|
400,000
|
|
|
(4,089
|
)
|
|
395,911
|
|
|
|||||||||
Unsecured senior notes payable
|
|
4.70
|
%
|
|
4.81
|
|
|
7/1/30
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
450,000
|
|
|
450,000
|
|
|
(3,903
|
)
|
|
446,097
|
|
|
|||||||||
Unsecured senior notes payable
|
|
3.375
|
%
|
|
3.48
|
|
|
8/15/31
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
750,000
|
|
|
750,000
|
|
|
(7,527
|
)
|
|
742,473
|
|
|
|||||||||
Unsecured senior notes payable
|
|
4.85
|
%
|
|
4.93
|
|
|
4/15/49
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
300,000
|
|
|
300,000
|
|
|
(3,446
|
)
|
|
296,554
|
|
|
|||||||||
Unsecured senior notes payable
|
|
4.00
|
%
|
|
3.91
|
|
|
2/1/50
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
700,000
|
|
|
700,000
|
|
|
10,476
|
|
|
710,476
|
|
|
|||||||||
Unsecured debt weighted-average interest rate/subtotal
|
|
|
|
3.93
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
500,000
|
|
|
1,034,000
|
|
|
4,925,000
|
|
|
6,459,000
|
|
|
(30,873
|
)
|
|
6,428,127
|
|
|
||||||||||
Weighted-average interest rate/total
|
|
|
|
3.91
|
%
|
|
|
|
$
|
6,418
|
|
|
$
|
6,901
|
|
|
$
|
7,227
|
|
|
$
|
604,548
|
|
|
$
|
1,217,559
|
|
|
$
|
4,953,787
|
|
|
$
|
6,796,440
|
|
|
$
|
(18,961
|
)
|
|
$
|
6,777,479
|
|
|
(1)
|
Represents the weighted-average interest rate as of the end of the applicable period, including amortization of loan fees, amortization of debt premiums (discounts), and other bank fees.
|
(2)
|
Reflects any extension options that we control.
|
(3)
|
In September 2019, we established a commercial paper program that has the ability to issue up to $750.0 million of commercial paper notes with a maximum maturity of 397 days from the date of issuance. Borrowings under the program will be used to fund short-term capital needs and are backed by our $2.2 billion unsecured senior line of credit. In the event we are unable to refinance outstanding borrowings under terms equal to or more favorable than those under the unsecured senior line of credit, we expect to borrow under the unsecured senior line of credit at L+0.825%. The commercial paper notes sold during the year ended December 31, 2019, were issued at a yield to maturity of between 1.83% and 2.29%.
|
10.
|
Secured and unsecured senior debt (continued)
|
10.
|
Secured and unsecured senior debt (continued)
|
|
Issuance
Date |
|
Stated Interest Rate
|
|
Effective Interest Rate
|
|
Maturity Date
|
|
Principal Amount
|
|
Net Proceeds
|
||||||
Issuances
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Unsecured senior notes payable – green bond
|
March
|
|
4.00
|
%
|
|
4.03
|
%
|
|
1/15/24
|
|
$
|
200
|
|
|
$
|
203.0
|
|
Unsecured senior notes payable – green bond
|
March
|
|
3.80
|
|
|
3.96
|
|
|
4/15/26
|
|
350
|
|
|
346.6
|
|
||
Unsecured senior notes payable
|
March
|
|
4.85
|
|
|
4.93
|
|
|
4/15/49
|
|
300
|
|
|
296.5
|
|
||
Unsecured senior notes payable
|
July
|
|
3.375
|
|
|
3.48
|
|
|
8/15/31
|
|
750
|
|
|
742.5
|
|
||
Unsecured senior notes payable
|
July/Sept
|
|
4.00
|
|
|
3.91
|
|
|
2/1/50
|
|
700
|
|
|
711.1
|
|
||
Unsecured senior notes payable
|
Sept
|
|
2.75
|
|
|
2.87
|
|
|
12/15/29
|
|
400
|
|
|
395.8
|
|
||
|
|
|
3.71
|
%
|
|
3.77
|
%
|
|
16.9 years
|
|
$
|
2,700
|
|
(1)
|
$
|
2,695.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Repayments of debt
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Secured notes payable
|
Jan
|
|
7.75
|
%
|
|
8.15
|
%
|
|
4/1/20
|
|
$
|
107
|
|
|
N/A
|
||
Secured construction loan
|
March
|
|
3.29
|
|
|
3.29
|
|
|
1/28/20
|
|
193
|
|
|
N/A
|
|||
Unsecured senior notes payable
|
July/Aug
|
|
2.75
|
|
|
2.96
|
|
|
1/15/20
|
|
400
|
|
|
N/A
|
|||
Unsecured senior notes payable
|
July/Aug
|
|
4.60
|
|
|
4.75
|
|
|
4/1/22
|
|
550
|
|
|
N/A
|
|||
Unsecured senior bank term loan
|
July/Sept
|
|
3.62
|
|
|
3.62
|
|
|
1/2/25
|
|
350
|
|
|
N/A
|
|||
Weighted average/total
|
|
|
3.97
|
%
|
|
4.11
|
%
|
|
2.4 years
|
|
$
|
1,600
|
|
(1)
|
|
(1)
|
The remaining proceeds received from our debt issuances, after repayments of debt, were used to fund the construction of our value-creation pipeline and acquisitions completed during 2019. Refer to Note 3 – “Investments in Real Estate” to our consolidated financial statements for additional information.
|
10.
|
Secured and unsecured senior debt (continued)
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Interest incurred
|
|
$
|
262,238
|
|
|
$
|
223,715
|
|
|
$
|
186,867
|
|
Capitalized interest
|
|
(88,563
|
)
|
|
(66,220
|
)
|
|
(58,222
|
)
|
|||
Interest expense
|
|
$
|
173,675
|
|
|
$
|
157,495
|
|
|
$
|
128,645
|
|
11.
|
Interest rate hedge agreements
|
•
|
We have proactively reduced outstanding LIBOR-based borrowings under our unsecured senior bank term loans and secured construction loans through repayments. From January 2017 to December 2018, we retired approximately $942.0 million of such debt.
|
•
|
During the year ended December 31, 2019, we further reduced our exposure to LIBOR as follows:
|
•
|
Repaid the $350.0 million balance and extinguished our unsecured senior bank term loan.
|
•
|
Fully repaid outstanding balances aggregating $193.1 million under our LIBOR-based construction loans.
|
•
|
During the three months ended September 30, 2019, we established a commercial paper program, under which we have the ability to issue up to $750.0 million of commercial paper notes, bearing interest at short-term fixed rates, with a maximum maturity of 397 days from the date of issuance. Our commercial paper program is not subject to LIBOR and is used for funding short-term working capital needs. As of December 31, 2019, we had no outstanding borrowings under our commercial paper program.
|
•
|
We continue to prudently manage outstanding borrowings under our unsecured senior line of credit, which represented less than 6% of our total debt balance outstanding as of December 31, 2019. Excluding LIBOR-based debt held by our unconsolidated joint ventures, borrowings under our unsecured senior line of credit represented our only LIBOR-based debt outstanding as of December 31, 2019.
|
12.
|
Accounts payable, accrued expenses, and other liabilities
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Accounts payable and accrued expenses
|
$
|
198,994
|
|
|
$
|
215,539
|
|
Accrued construction
|
275,818
|
|
|
275,882
|
|
||
Acquired below-market leases
|
194,773
|
|
|
134,808
|
|
||
Conditional asset retirement obligations
|
14,037
|
|
|
10,343
|
|
||
Deferred rent liabilities(1)
|
2,897
|
|
|
29,547
|
|
||
Interest rate hedge liabilities
|
—
|
|
|
768
|
|
||
Operating lease liability(1)
|
271,808
|
|
|
—
|
|
||
Unearned rent and tenant security deposits
|
275,863
|
|
|
250,923
|
|
||
Other liabilities
|
86,078
|
|
|
63,897
|
|
||
Total
|
$
|
1,320,268
|
|
|
$
|
981,707
|
|
(1)
|
Refer to Note 2 – “Summary of Significant Accounting Policies” and Note 5 – “Leases” to our consolidated financial statements for additional information.
|
13.
|
Earnings per share
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
$
|
404,047
|
|
|
$
|
402,793
|
|
|
$
|
194,204
|
|
Net income attributable to noncontrolling interests
|
(40,882
|
)
|
|
(23,481
|
)
|
|
(25,111
|
)
|
|||
Dividends on preferred stock
|
(3,204
|
)
|
|
(5,060
|
)
|
|
(7,666
|
)
|
|||
Preferred stock redemption charge
|
(2,580
|
)
|
|
(4,240
|
)
|
|
(11,279
|
)
|
|||
Net income attributable to unvested restricted stock awards
|
(6,386
|
)
|
|
(6,029
|
)
|
|
(4,753
|
)
|
|||
Numerator for basic and diluted EPS – net income attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
$
|
350,995
|
|
|
$
|
363,983
|
|
|
$
|
145,395
|
|
|
|
|
|
|
|
||||||
Denominator for basic EPS – weighted-average shares of common stock outstanding
|
112,204
|
|
|
103,010
|
|
|
91,546
|
|
|||
Dilutive effect of forward equity sales agreements
|
320
|
|
|
311
|
|
|
517
|
|
|||
Denominator for diluted EPS – weighted-average shares of common stock outstanding
|
112,524
|
|
|
103,321
|
|
|
92,063
|
|
|||
Net income per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders:
|
|
|
|
|
|
||||||
Basic
|
$
|
3.13
|
|
|
$
|
3.53
|
|
|
$
|
1.59
|
|
Diluted
|
$
|
3.12
|
|
|
$
|
3.52
|
|
|
$
|
1.58
|
|
14.
|
Income taxes
|
(1)
|
Refer to Note 16 - “Stockholders’ Equity” to our consolidated financial statements for information regarding the conversion of our Series D Preferred Stock and redemption of our Series E Preferred Stock.
|
14.
|
Income taxes (continued)
|
|
|
Year Ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Net income
|
|
$
|
402,793
|
|
|
$
|
194,204
|
|
Net income attributable to noncontrolling interests
|
|
(23,481
|
)
|
|
(25,111
|
)
|
||
Book/tax differences:
|
|
|
|
|
||||
Rental revenue recognition
|
|
(65,901
|
)
|
|
(121,589
|
)
|
||
Depreciation and amortization
|
|
161,514
|
|
|
137,576
|
|
||
Share-based compensation
|
|
30,771
|
|
|
23,466
|
|
||
Interest expense
|
|
(6,414
|
)
|
|
(5,256
|
)
|
||
Sales of property
|
|
(39,393
|
)
|
|
12,166
|
|
||
Impairments
|
|
—
|
|
|
9,011
|
|
||
Unrealized (gains)/losses on non-real estate investments
|
|
(95,757
|
)
|
|
—
|
|
||
Other
|
|
(5,043
|
)
|
|
3,642
|
|
||
Taxable income before dividend deduction
|
|
359,089
|
|
|
228,109
|
|
||
Dividend deduction necessary to eliminate taxable income(1)
|
|
(359,089
|
)
|
|
(228,109
|
)
|
||
Estimated income subject to federal income tax
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Total common stock and preferred stock dividend distributions paid were approximately $385.8 million and $321.8 million during the years ended December 31, 2018 and 2017, respectively.
|
15.
|
Commitments and contingencies
|
16.
|
Stockholders’ equity
|
•
|
Issued an aggregate of 8.1 million shares of common stock, at a weighted-average price of $139.32 per share, for aggregate proceeds (net of underwriters’ discounts) of approximately $1.1 billion. During the year ended December 31, 2019, we incurred initial issuance costs aggregating $700 thousand in connection with these forward equity sales agreements.
|
•
|
Issued 602,484 shares of common stock under our ATM program, at a weighted-average price of $145.58 per share, for net proceeds of $86.1 million, during the three months ended June 30, 2019. As of December 31, 2019, we had approximately $22.5 million of gross proceeds available to be issued under our ATM program.
|
•
|
The proceeds were used to fund construction projects and to fund 2019 acquisitions completed prior to December 2019.
|
16.
|
Stockholders’ equity (continued)
|
17.
|
Share-based compensation
|
|
|
|
|
Number of Share Awards
|
|
Weighted-Average
Grant Date
Fair Value Per Share
|
|||||||||
Outstanding at December 31, 2016
|
|
|
|
1,135,788
|
|
|
$
|
87.21
|
|
|
|||||
Granted
|
|
|
|
688,295
|
|
|
$
|
108.22
|
|
|
|||||
Vested
|
|
|
|
(423,705
|
)
|
|
$
|
85.16
|
|
|
|||||
Forfeited
|
|
|
|
(5,796
|
)
|
|
$
|
101.45
|
|
|
|||||
Outstanding at December 31, 2017
|
|
|
|
1,394,582
|
|
|
$
|
95.79
|
|
|
|||||
Granted
|
|
|
|
741,244
|
|
|
$
|
121.20
|
|
|
|||||
Vested
|
|
|
|
(403,120
|
)
|
|
$
|
103.83
|
|
|
|||||
Forfeited
|
|
|
|
(20,330
|
)
|
|
$
|
106.38
|
|
|
|||||
Outstanding at December 31, 2018
|
|
|
|
1,712,376
|
|
|
$
|
105.22
|
|
|
|||||
Granted
|
|
|
|
768,625
|
|
|
$
|
134.70
|
|
|
|||||
Vested
|
|
|
|
(666,836
|
)
|
|
$
|
96.77
|
|
|
|||||
Forfeited
|
|
|
|
(14,480
|
)
|
|
$
|
119.88
|
|
|
|||||
Outstanding at December 31, 2019
|
|
|
|
1,799,685
|
|
|
$
|
119.59
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|||||||
|
|
Year Ended December 31,
|
|||||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
|||||||||
Total grant date fair value of stock awards vested
|
|
$
|
64,530
|
|
|
$
|
41,854
|
|
|
$
|
36,083
|
|
|||
Total gross compensation recognized for stock awards
|
|
$
|
68,036
|
|
|
$
|
57,341
|
|
|
$
|
42,292
|
|
|||
Capitalized stock compensation
|
|
$
|
24,396
|
|
|
$
|
22,322
|
|
|
$
|
16,682
|
|
18.
|
Noncontrolling interests
|
19.
|
Assets classified as held for sale
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Total assets
|
$
|
59,412
|
|
|
$
|
31,260
|
|
Total liabilities
|
(2,860
|
)
|
|
(2,476
|
)
|
||
Total accumulated other comprehensive loss
|
536
|
|
|
768
|
|
||
Net assets classified as held for sale
|
$
|
57,088
|
|
|
$
|
29,552
|
|
20.
|
Quarterly financial data (unaudited)
|
|
|
Quarter
|
|
||||||||||||||
2019
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
||||||||
Total revenues
|
|
$
|
358,842
|
|
|
$
|
373,856
|
|
|
$
|
390,484
|
|
|
$
|
408,114
|
|
|
Net income (loss) attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
|
$
|
123,598
|
|
|
$
|
76,330
|
|
|
$
|
(49,773
|
)
|
|
$
|
199,618
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic(1)
|
|
$
|
1.11
|
|
|
$
|
0.68
|
|
|
$
|
(0.44
|
)
|
|
$
|
1.75
|
|
|
Diluted(1)
|
|
$
|
1.11
|
|
|
$
|
0.68
|
|
|
$
|
(0.44
|
)
|
|
$
|
1.74
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Quarter
|
|
||||||||||||||
2018
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
||||||||
Total revenues
|
|
$
|
320,139
|
|
|
$
|
325,034
|
|
|
$
|
341,823
|
|
|
$
|
340,463
|
|
|
Net income (loss) attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
|
$
|
132,387
|
|
|
$
|
52,016
|
|
|
$
|
208,940
|
|
|
$
|
(31,740
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share attributable to Alexandria Real Estate Equities, Inc.’s common stockholders:
|
|
|
|
|
|
|
|
|
|
||||||||
Basic(1)
|
|
$
|
1.33
|
|
|
$
|
0.51
|
|
|
$
|
2.01
|
|
|
$
|
(0.30
|
)
|
|
Diluted(1)
|
|
$
|
1.32
|
|
|
$
|
0.51
|
|
|
$
|
1.99
|
|
|
$
|
(0.30
|
)
|
|
(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.
|
21.
|
Subsequent events
|
22.
|
Condensed consolidating financial information
|
22.
|
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
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,844,038
|
|
|
$
|
—
|
|
|
$
|
14,844,038
|
|
Investments in unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
346,890
|
|
|
—
|
|
|
346,890
|
|
|||||
Cash and cash equivalents
|
4,202
|
|
|
—
|
|
|
185,479
|
|
|
—
|
|
|
189,681
|
|
|||||
Restricted cash
|
230
|
|
|
—
|
|
|
52,778
|
|
|
—
|
|
|
53,008
|
|
|||||
Tenant receivables
|
—
|
|
|
—
|
|
|
10,691
|
|
|
—
|
|
|
10,691
|
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
641,844
|
|
|
—
|
|
|
641,844
|
|
|||||
Deferred leasing costs
|
—
|
|
|
—
|
|
|
270,043
|
|
|
—
|
|
|
270,043
|
|
|||||
Investments
|
—
|
|
|
1,014
|
|
|
1,139,580
|
|
|
—
|
|
|
1,140,594
|
|
|||||
Investments in and advances to affiliates
|
15,498,357
|
|
|
13,950,850
|
|
|
284,207
|
|
|
(29,733,414
|
)
|
|
—
|
|
|||||
Other assets
|
70,022
|
|
|
—
|
|
|
823,692
|
|
|
—
|
|
|
893,714
|
|
|||||
Total assets
|
$
|
15,572,811
|
|
|
$
|
13,951,864
|
|
|
$
|
18,599,242
|
|
|
$
|
(29,733,414
|
)
|
|
$
|
18,390,503
|
|
Liabilities, Noncontrolling Interests, and Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Secured notes payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
349,352
|
|
|
$
|
—
|
|
|
$
|
349,352
|
|
Unsecured senior notes payable
|
6,044,127
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,044,127
|
|
|||||
Unsecured senior line of credit
|
384,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
384,000
|
|
|||||
Accounts payable, accrued expenses, and
other liabilities
|
152,580
|
|
|
—
|
|
|
1,167,688
|
|
|
—
|
|
|
1,320,268
|
|
|||||
Dividends payable
|
126,278
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
126,278
|
|
|||||
Total liabilities
|
6,706,985
|
|
|
—
|
|
|
1,517,040
|
|
|
—
|
|
|
8,224,025
|
|
|||||
Redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
12,300
|
|
|
—
|
|
|
12,300
|
|
|||||
Alexandria Real Estate Equities, Inc.’s
stockholders’ equity
|
8,865,826
|
|
|
13,951,864
|
|
|
15,781,550
|
|
|
(29,733,414
|
)
|
|
8,865,826
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
1,288,352
|
|
|
—
|
|
|
1,288,352
|
|
|||||
Total equity
|
8,865,826
|
|
|
13,951,864
|
|
|
17,069,902
|
|
|
(29,733,414
|
)
|
|
10,154,178
|
|
|||||
Total liabilities, noncontrolling interests, and equity
|
$
|
15,572,811
|
|
|
$
|
13,951,864
|
|
|
$
|
18,599,242
|
|
|
$
|
(29,733,414
|
)
|
|
$
|
18,390,503
|
|
22.
|
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
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11,913,693
|
|
|
$
|
—
|
|
|
$
|
11,913,693
|
|
Investments in unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
237,507
|
|
|
—
|
|
|
237,507
|
|
|||||
Cash and cash equivalents
|
119,112
|
|
|
—
|
|
|
115,069
|
|
|
—
|
|
|
234,181
|
|
|||||
Restricted cash
|
193
|
|
|
—
|
|
|
37,756
|
|
|
—
|
|
|
37,949
|
|
|||||
Tenant receivables
|
—
|
|
|
—
|
|
|
9,798
|
|
|
—
|
|
|
9,798
|
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
530,237
|
|
|
—
|
|
|
530,237
|
|
|||||
Deferred leasing costs
|
—
|
|
|
—
|
|
|
239,070
|
|
|
—
|
|
|
239,070
|
|
|||||
Investments
|
—
|
|
|
1,262
|
|
|
891,002
|
|
|
—
|
|
|
892,264
|
|
|||||
Investments in and advances to affiliates
|
12,235,577
|
|
|
10,949,631
|
|
|
222,983
|
|
|
(23,408,191
|
)
|
|
—
|
|
|||||
Other assets
|
56,353
|
|
|
—
|
|
|
313,904
|
|
|
—
|
|
|
370,257
|
|
|||||
Total assets
|
$
|
12,411,235
|
|
|
$
|
10,950,893
|
|
|
$
|
14,511,019
|
|
|
$
|
(23,408,191
|
)
|
|
$
|
14,464,956
|
|
Liabilities, Noncontrolling Interests, and Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Secured notes payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
630,547
|
|
|
$
|
—
|
|
|
$
|
630,547
|
|
Unsecured senior notes payable
|
4,292,293
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,292,293
|
|
|||||
Unsecured senior line of credit
|
208,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
208,000
|
|
|||||
Unsecured senior bank term loan
|
347,415
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
347,415
|
|
|||||
Accounts payable, accrued expenses, and other liabilities
|
111,282
|
|
|
—
|
|
|
870,425
|
|
|
—
|
|
|
981,707
|
|
|||||
Dividends payable
|
110,280
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
110,280
|
|
|||||
Total liabilities
|
5,069,270
|
|
|
—
|
|
|
1,500,972
|
|
|
—
|
|
|
6,570,242
|
|
|||||
Redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
10,786
|
|
|
—
|
|
|
10,786
|
|
|||||
Alexandria Real Estate Equities, Inc.’s stockholders’ equity
|
7,341,965
|
|
|
10,950,893
|
|
|
12,457,298
|
|
|
(23,408,191
|
)
|
|
7,341,965
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
541,963
|
|
|
—
|
|
|
541,963
|
|
|||||
Total equity
|
7,341,965
|
|
|
10,950,893
|
|
|
12,999,261
|
|
|
(23,408,191
|
)
|
|
7,883,928
|
|
|||||
Total liabilities, noncontrolling interests, and equity
|
$
|
12,411,235
|
|
|
$
|
10,950,893
|
|
|
$
|
14,511,019
|
|
|
$
|
(23,408,191
|
)
|
|
$
|
14,464,956
|
|
22.
|
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:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from rentals
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,516,864
|
|
|
$
|
—
|
|
|
$
|
1,516,864
|
|
Other income
|
22,731
|
|
|
—
|
|
|
14,684
|
|
|
(22,983
|
)
|
|
14,432
|
|
|||||
Total revenues
|
22,731
|
|
|
—
|
|
|
1,531,548
|
|
|
(22,983
|
)
|
|
1,531,296
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental operations
|
—
|
|
|
—
|
|
|
445,492
|
|
|
—
|
|
|
445,492
|
|
|||||
General and administrative
|
106,523
|
|
|
—
|
|
|
25,283
|
|
|
(22,983
|
)
|
|
108,823
|
|
|||||
Interest
|
164,249
|
|
|
—
|
|
|
9,426
|
|
|
—
|
|
|
173,675
|
|
|||||
Depreciation and amortization
|
6,949
|
|
|
—
|
|
|
537,663
|
|
|
—
|
|
|
544,612
|
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
12,334
|
|
|
—
|
|
|
12,334
|
|
|||||
Loss on early extinguishment of debt
|
40,209
|
|
|
—
|
|
|
7,361
|
|
|
—
|
|
|
47,570
|
|
|||||
Total expenses
|
317,930
|
|
|
—
|
|
|
1,037,559
|
|
|
(22,983
|
)
|
|
1,332,506
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings of unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
10,136
|
|
|
—
|
|
|
10,136
|
|
|||||
Equity in earnings of affiliates
|
658,364
|
|
|
490,393
|
|
|
9,644
|
|
|
(1,158,401
|
)
|
|
—
|
|
|||||
Investment income
|
—
|
|
|
34
|
|
|
194,613
|
|
|
—
|
|
|
194,647
|
|
|||||
Gain on sales of real estate
|
—
|
|
|
—
|
|
|
474
|
|
|
—
|
|
|
474
|
|
|||||
Net income
|
363,165
|
|
|
490,427
|
|
|
708,856
|
|
|
(1,158,401
|
)
|
|
404,047
|
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(40,882
|
)
|
|
—
|
|
|
(40,882
|
)
|
|||||
Net income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
363,165
|
|
|
490,427
|
|
|
667,974
|
|
|
(1,158,401
|
)
|
|
363,165
|
|
|||||
Dividends on preferred stock
|
(3,204
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,204
|
)
|
|||||
Preferred stock redemption charge
|
(2,580
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,580
|
)
|
|||||
Net income attributable to unvested restricted stock awards
|
(6,386
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,386
|
)
|
|||||
Net income attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
$
|
350,995
|
|
|
$
|
490,427
|
|
|
$
|
667,974
|
|
|
$
|
(1,158,401
|
)
|
|
$
|
350,995
|
|
22.
|
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:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income from rentals
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,314,781
|
|
|
$
|
—
|
|
|
$
|
1,314,781
|
|
|
Other income
|
19,275
|
|
|
—
|
|
|
14,941
|
|
|
(21,538
|
)
|
|
12,678
|
|
||||||
Total revenues
|
19,275
|
|
|
—
|
|
|
1,329,722
|
|
|
(21,538
|
)
|
|
1,327,459
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Rental operations
|
—
|
|
|
—
|
|
|
381,120
|
|
|
—
|
|
|
381,120
|
|
||||||
General and administrative
|
88,707
|
|
|
—
|
|
|
23,236
|
|
|
(21,538
|
)
|
|
90,405
|
|
||||||
Interest
|
136,036
|
|
|
—
|
|
|
21,459
|
|
|
—
|
|
|
157,495
|
|
||||||
Depreciation and amortization
|
6,339
|
|
|
—
|
|
|
471,322
|
|
|
—
|
|
|
477,661
|
|
||||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
6,311
|
|
|
—
|
|
|
6,311
|
|
||||||
Loss on early extinguishment of debt
|
823
|
|
|
—
|
|
|
299
|
|
|
—
|
|
|
1,122
|
|
||||||
Total expenses
|
231,905
|
|
|
—
|
|
|
903,747
|
|
|
(21,538
|
)
|
|
1,114,114
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity in earnings of unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
43,981
|
|
|
—
|
|
|
43,981
|
|
||||||
Equity in earnings of affiliates
|
591,942
|
|
|
455,574
|
|
|
9,057
|
|
|
(1,056,573
|
)
|
|
—
|
|
||||||
Investment income
|
—
|
|
|
528
|
|
|
136,235
|
|
|
—
|
|
|
136,763
|
|
||||||
Gain on sales of real estate
|
—
|
|
|
—
|
|
|
8,704
|
|
|
—
|
|
|
8,704
|
|
||||||
Net income
|
379,312
|
|
|
456,102
|
|
|
623,952
|
|
|
(1,056,573
|
)
|
|
402,793
|
|
||||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(23,481
|
)
|
|
—
|
|
|
(23,481
|
)
|
||||||
Net income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
379,312
|
|
|
456,102
|
|
|
600,471
|
|
|
(1,056,573
|
)
|
|
379,312
|
|
||||||
Dividends on preferred stock
|
(5,060
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,060
|
)
|
||||||
Preferred stock redemption charge
|
(4,240
|
)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,240
|
)
|
|||||
Net income attributable to unvested restricted stock awards
|
(6,029
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,029
|
)
|
||||||
Net income attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
$
|
363,983
|
|
|
$
|
456,102
|
|
|
$
|
600,471
|
|
|
$
|
(1,056,573
|
)
|
|
$
|
363,983
|
|
22.
|
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:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from rentals
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,122,325
|
|
|
$
|
—
|
|
|
$
|
1,122,325
|
|
Other income (loss)
|
15,238
|
|
|
(2,575
|
)
|
|
11,278
|
|
|
(18,169
|
)
|
|
5,772
|
|
|||||
Total revenues
|
15,238
|
|
|
(2,575
|
)
|
|
1,133,603
|
|
|
(18,169
|
)
|
|
1,128,097
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental operations
|
—
|
|
|
—
|
|
|
325,609
|
|
|
—
|
|
|
325,609
|
|
|||||
General and administrative
|
73,897
|
|
|
—
|
|
|
19,281
|
|
|
(18,169
|
)
|
|
75,009
|
|
|||||
Interest
|
101,876
|
|
|
—
|
|
|
26,769
|
|
|
—
|
|
|
128,645
|
|
|||||
Depreciation and amortization
|
7,625
|
|
|
—
|
|
|
409,158
|
|
|
—
|
|
|
416,783
|
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
203
|
|
|
—
|
|
|
203
|
|
|||||
Loss on early extinguishment of debt
|
670
|
|
|
—
|
|
|
2,781
|
|
|
—
|
|
|
3,451
|
|
|||||
Total expenses
|
184,068
|
|
|
—
|
|
|
783,801
|
|
|
(18,169
|
)
|
|
949,700
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Equity in losses of unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
15,426
|
|
|
—
|
|
|
15,426
|
|
|||||
Equity in earnings of affiliates
|
337,923
|
|
|
328,230
|
|
|
6,384
|
|
|
(672,537
|
)
|
|
—
|
|
|||||
Gain on sale of real estate – rental properties
|
—
|
|
|
—
|
|
|
270
|
|
|
—
|
|
|
270
|
|
|||||
Gain on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
111
|
|
|
—
|
|
|
111
|
|
|||||
Net income
|
169,093
|
|
|
325,655
|
|
|
371,993
|
|
|
(672,537
|
)
|
|
194,204
|
|
|||||
Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(25,111
|
)
|
|
—
|
|
|
(25,111
|
)
|
|||||
Net income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
169,093
|
|
|
325,655
|
|
|
346,882
|
|
|
(672,537
|
)
|
|
169,093
|
|
|||||
Dividends on preferred stock
|
(7,666
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,666
|
)
|
|||||
Preferred stock redemption charge
|
(11,279
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,279
|
)
|
|||||
Net income attributable to unvested restricted stock awards
|
(4,753
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,753
|
)
|
|||||
Net income attributable to Alexandria Real Estate Equities, Inc.’s common stockholders
|
$
|
145,395
|
|
|
$
|
325,655
|
|
|
$
|
346,882
|
|
|
$
|
(672,537
|
)
|
|
$
|
145,395
|
|
22.
|
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
|
$
|
363,165
|
|
|
$
|
490,427
|
|
|
$
|
708,856
|
|
|
$
|
(1,158,401
|
)
|
|
$
|
404,047
|
|
Other comprehensive (loss) income
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized losses on interest rate hedge agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized interest rate hedge losses arising during the period
|
(1,763
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,763
|
)
|
|||||
Reclassification adjustment for amortization to interest expense included in net income
|
(1,777
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,777
|
)
|
|||||
Reclassification of losses related to terminated interest rate hedge instruments to interest expense included in net income
|
1,702
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,702
|
|
|||||
Unrealized losses on interest rate hedge agreements, net
|
(1,838
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,838
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains on foreign currency translation:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized foreign currency translation gains arising during the period
|
—
|
|
|
—
|
|
|
2,524
|
|
|
—
|
|
|
2,524
|
|
|||||
Unrealized gains on foreign currency translation, net
|
—
|
|
|
—
|
|
|
2,524
|
|
|
—
|
|
|
2,524
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total other comprehensive (loss) income
|
(1,838
|
)
|
|
—
|
|
|
2,524
|
|
|
—
|
|
|
686
|
|
|||||
Comprehensive income
|
361,327
|
|
|
490,427
|
|
|
711,380
|
|
|
(1,158,401
|
)
|
|
404,733
|
|
|||||
Less: comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(40,882
|
)
|
|
—
|
|
|
(40,882
|
)
|
|||||
Comprehensive income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
$
|
361,327
|
|
|
$
|
490,427
|
|
|
$
|
670,498
|
|
|
$
|
(1,158,401
|
)
|
|
$
|
363,851
|
|
22.
|
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
|
$
|
379,312
|
|
|
$
|
456,102
|
|
|
$
|
623,952
|
|
|
$
|
(1,056,573
|
)
|
402,793
|
|
$
|
402,793
|
|
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|||||||||||
Unrealized losses on interest rate hedge agreements:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Unrealized interest rate hedge gains arising during the period
|
1,622
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,622
|
|
||||||
Reclassification adjustment for amortization to interest expense included in net income
|
(4,941
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,941
|
)
|
||||||
Unrealized losses on interest rate hedge agreements, net
|
(3,319
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,319
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Unrealized losses on foreign currency translation:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Unrealized foreign currency translation losses arising during the period
|
—
|
|
|
—
|
|
|
(7,369
|
)
|
|
—
|
|
|
(7,369
|
)
|
||||||
Unrealized losses on foreign currency translation, net
|
—
|
|
|
—
|
|
|
(7,369
|
)
|
|
—
|
|
|
(7,369
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total other comprehensive loss
|
(3,319
|
)
|
|
—
|
|
|
(7,369
|
)
|
|
—
|
|
|
(10,688
|
)
|
||||||
Comprehensive income
|
375,993
|
|
|
456,102
|
|
|
616,583
|
|
|
(1,056,573
|
)
|
|
392,105
|
|
||||||
Less: comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(23,481
|
)
|
|
—
|
|
|
(23,481
|
)
|
||||||
Comprehensive income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
$
|
375,993
|
|
|
$
|
456,102
|
|
|
$
|
593,102
|
|
|
$
|
(1,056,573
|
)
|
|
$
|
368,624
|
|
22.
|
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
|
$
|
169,093
|
|
|
$
|
325,655
|
|
|
$
|
371,993
|
|
|
$
|
(672,537
|
)
|
|
$
|
194,204
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized (losses) gains on available-for-sale equity securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized holding (losses) gains arising during the period
|
—
|
|
|
(5
|
)
|
|
24,365
|
|
|
—
|
|
|
24,360
|
|
|||||
Reclassification adjustment for losses included in net income
|
—
|
|
|
2
|
|
|
6,116
|
|
|
—
|
|
|
6,118
|
|
|||||
Unrealized (losses) gains on available-for-sale equity securities, net
|
—
|
|
|
(3
|
)
|
|
30,481
|
|
|
—
|
|
|
30,478
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) on interest rate hedge agreements:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized interest rate hedge gains (losses) arising during the period
|
3,025
|
|
|
—
|
|
|
(188
|
)
|
|
—
|
|
|
2,837
|
|
|||||
Reclassification adjustment for amortization to interest expense included in net income
|
1,914
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1,915
|
|
|||||
Unrealized gains (losses) on interest rate hedge agreements, net
|
4,939
|
|
|
—
|
|
|
(187
|
)
|
|
—
|
|
|
4,752
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains on foreign currency translation:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized foreign currency translation gains arising during the period
|
—
|
|
|
—
|
|
|
7,774
|
|
|
—
|
|
|
7,774
|
|
|||||
Reclassification adjustment for cumulative foreign currency translation losses included in net income upon sale or liquidation
|
—
|
|
|
—
|
|
|
1,599
|
|
|
—
|
|
|
1,599
|
|
|||||
Unrealized gains on foreign currency translation, net
|
—
|
|
|
—
|
|
|
9,373
|
|
|
—
|
|
|
9,373
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total other comprehensive income (loss)
|
4,939
|
|
|
(3
|
)
|
|
39,667
|
|
|
—
|
|
|
44,603
|
|
|||||
Comprehensive income
|
174,032
|
|
|
325,652
|
|
|
411,660
|
|
|
(672,537
|
)
|
|
238,807
|
|
|||||
Less: comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(25,045
|
)
|
|
—
|
|
|
(25,045
|
)
|
|||||
Comprehensive income attributable to Alexandria Real Estate Equities, Inc.’s stockholders
|
$
|
174,032
|
|
|
$
|
325,652
|
|
|
$
|
386,615
|
|
|
$
|
(672,537
|
)
|
|
$
|
213,762
|
|
22.
|
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
|
$
|
363,165
|
|
|
$
|
490,427
|
|
|
$
|
708,856
|
|
|
$
|
(1,158,401
|
)
|
|
$
|
404,047
|
|
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
6,949
|
|
|
—
|
|
|
537,663
|
|
|
—
|
|
|
544,612
|
|
|||||
Loss on early extinguishment of debt
|
40,209
|
|
|
—
|
|
|
7,361
|
|
|
—
|
|
|
47,570
|
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
12,334
|
|
|
—
|
|
|
12,334
|
|
|||||
Gain on sales of real estate – rental properties
|
—
|
|
|
—
|
|
|
(474
|
)
|
|
—
|
|
|
(474
|
)
|
|||||
Equity in earnings of unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
(10,136
|
)
|
|
—
|
|
|
(10,136
|
)
|
|||||
Distributions of earnings from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
2,796
|
|
|
—
|
|
|
2,796
|
|
|||||
Amortization of loan fees
|
8,780
|
|
|
—
|
|
|
325
|
|
|
—
|
|
|
9,105
|
|
|||||
Amortization of debt premiums
|
(573
|
)
|
|
—
|
|
|
(3,204
|
)
|
|
—
|
|
|
(3,777
|
)
|
|||||
Amortization of acquired below-market leases
|
—
|
|
|
—
|
|
|
(29,813
|
)
|
|
—
|
|
|
(29,813
|
)
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
(104,235
|
)
|
|
—
|
|
|
(104,235
|
)
|
|||||
Stock compensation expense
|
43,640
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43,640
|
|
|||||
Equity in earnings of affiliates
|
(658,364
|
)
|
|
(490,393
|
)
|
|
(9,644
|
)
|
|
1,158,401
|
|
|
—
|
|
|||||
Investment income
|
—
|
|
|
(34
|
)
|
|
(194,613
|
)
|
|
—
|
|
|
(194,647
|
)
|
|||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Tenant receivables
|
—
|
|
|
—
|
|
|
(897
|
)
|
|
—
|
|
|
(897
|
)
|
|||||
Deferred leasing costs
|
—
|
|
|
—
|
|
|
(54,455
|
)
|
|
—
|
|
|
(54,455
|
)
|
|||||
Other assets
|
(7,171
|
)
|
|
—
|
|
|
(13,654
|
)
|
|
—
|
|
|
(20,825
|
)
|
|||||
Accounts payable, accrued expenses, and other liabilities
|
22,076
|
|
|
—
|
|
|
16,936
|
|
|
—
|
|
|
39,012
|
|
|||||
Net cash (used in) provided by operating activities
|
(181,289
|
)
|
|
—
|
|
|
865,146
|
|
|
—
|
|
|
683,857
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sales of real estate
|
—
|
|
|
—
|
|
|
6,619
|
|
|
—
|
|
|
6,619
|
|
|||||
Additions to real estate
|
—
|
|
|
—
|
|
|
(1,224,541
|
)
|
|
—
|
|
|
(1,224,541
|
)
|
|||||
Purchases of real estate
|
—
|
|
|
—
|
|
|
(2,259,778
|
)
|
|
—
|
|
|
(2,259,778
|
)
|
|||||
Deposits for investing activities
|
—
|
|
|
—
|
|
|
(18,107
|
)
|
|
—
|
|
|
(18,107
|
)
|
|||||
Investments in subsidiaries
|
(2,604,416
|
)
|
|
(2,510,826
|
)
|
|
(51,580
|
)
|
|
5,166,822
|
|
|
—
|
|
|||||
Investments in unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
(102,081
|
)
|
|
—
|
|
|
(102,081
|
)
|
|||||
Return of capital from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
|||||
Additions to non-real estate investments
|
—
|
|
|
—
|
|
|
(190,778
|
)
|
|
—
|
|
|
(190,778
|
)
|
|||||
Sales of non-real estate investments
|
—
|
|
|
282
|
|
|
147,050
|
|
|
—
|
|
|
147,332
|
|
|||||
Net cash used in investing activities
|
$
|
(2,604,416
|
)
|
|
$
|
(2,510,544
|
)
|
|
$
|
(3,693,182
|
)
|
|
$
|
5,166,822
|
|
|
$
|
(3,641,320
|
)
|
22.
|
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
|
|
|
|
|
|
|
|
|
|
||||||||||
Repayments of borrowings from secured notes payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(306,199
|
)
|
|
$
|
—
|
|
|
$
|
(306,199
|
)
|
Proceeds from issuance of unsecured senior notes payable
|
2,721,169
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,721,169
|
|
|||||
Repayments of unsecured senior notes payable
|
(950,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(950,000
|
)
|
|||||
Borrowings from unsecured senior line of credit
|
5,056,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,056,000
|
|
|||||
Repayments of borrowings from unsecured senior line of credit
|
(4,880,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,880,000
|
)
|
|||||
Proceeds from issuance of commercial paper program
|
2,233,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,233,000
|
|
|||||
Repayments of borrowings from commercial paper program
|
(2,233,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,233,000
|
)
|
|||||
Repayments of borrowings from unsecured senior bank term loan
|
(350,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(350,000
|
)
|
|||||
Premium paid for early extinguishment of debt
|
(34,677
|
)
|
|
—
|
|
|
(6,674
|
)
|
|
—
|
|
|
(41,351
|
)
|
|||||
Transfer to/from parent company
|
404,556
|
|
|
2,510,544
|
|
|
2,251,722
|
|
|
(5,166,822
|
)
|
|
—
|
|
|||||
Payments of loan fees
|
(26,774
|
)
|
|
—
|
|
|
(408
|
)
|
|
—
|
|
|
(27,182
|
)
|
|||||
Taxes paid related to net settlement of equity awards
|
(25,477
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,477
|
)
|
|||||
Repurchases of 7.00% Series D cumulative convertible preferred stock
|
(9,240
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,240
|
)
|
|||||
Proceeds from the issuance of common stock
|
1,216,445
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,216,445
|
|
|||||
Dividends on common stock
|
(447,029
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(447,029
|
)
|
|||||
Dividends on preferred stock
|
(4,141
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,141
|
)
|
|||||
Contributions from and sales of noncontrolling interests
|
—
|
|
|
—
|
|
|
1,022,712
|
|
|
—
|
|
|
1,022,712
|
|
|||||
Distributions to and purchase of noncontrolling interests
|
—
|
|
|
—
|
|
|
(48,225
|
)
|
|
—
|
|
|
(48,225
|
)
|
|||||
Net cash provided by financing activities
|
2,670,832
|
|
|
2,510,544
|
|
|
2,912,928
|
|
|
(5,166,822
|
)
|
|
2,927,482
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
—
|
|
|
—
|
|
|
540
|
|
|
—
|
|
|
540
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net (decrease) increase in cash, cash equivalents, and restricted cash
|
(114,873
|
)
|
|
—
|
|
|
85,432
|
|
|
—
|
|
|
(29,441
|
)
|
|||||
Cash, cash equivalents, and restricted cash as of the beginning of period
|
119,305
|
|
|
—
|
|
|
152,825
|
|
|
—
|
|
|
272,130
|
|
|||||
Cash, cash equivalents, and restricted cash as of the end of period
|
$
|
4,432
|
|
|
$
|
—
|
|
|
$
|
238,257
|
|
|
$
|
—
|
|
|
$
|
242,689
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Supplemental Disclosure and Non-Cash Investing and Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash paid during the period for interest, net of interest capitalized
|
$
|
133,033
|
|
|
$
|
—
|
|
|
$
|
13,132
|
|
|
$
|
—
|
|
|
$
|
146,165
|
|
Change in accrued construction
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(24
|
)
|
|
$
|
—
|
|
|
$
|
(24
|
)
|
Accrued construction for current-period additions to real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
220,773
|
|
|
$
|
—
|
|
|
$
|
220,773
|
|
Assumption of secured notes payable in connection with purchase of properties
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(28,200
|
)
|
|
$
|
—
|
|
|
$
|
(28,200
|
)
|
Right-of-use asset
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
269,189
|
|
|
$
|
—
|
|
|
$
|
269,189
|
|
Lease liability
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(275,175
|
)
|
|
$
|
—
|
|
|
$
|
(275,175
|
)
|
Contribution of real estate from noncontrolling interests
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
115,167
|
|
|
$
|
—
|
|
|
$
|
115,167
|
|
Issuance of common stock for conversion of 7.00% Series D preferred stock
|
$
|
57,461
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
57,461
|
|
22.
|
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
|
$
|
379,312
|
|
|
$
|
456,102
|
|
|
$
|
623,952
|
|
|
$
|
(1,056,573
|
)
|
|
$
|
402,793
|
|
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
6,339
|
|
|
—
|
|
|
471,322
|
|
|
—
|
|
|
477,661
|
|
|||||
Loss on early extinguishment of debt
|
823
|
|
|
—
|
|
|
299
|
|
|
—
|
|
|
1,122
|
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
6,311
|
|
|
—
|
|
|
6,311
|
|
|||||
Gain on sales of real estate – rental properties
|
—
|
|
|
—
|
|
|
(8,704
|
)
|
|
—
|
|
|
(8,704
|
)
|
|||||
Equity in earnings from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
(43,981
|
)
|
|
—
|
|
|
(43,981
|
)
|
|||||
Distributions of earnings from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
430
|
|
|
—
|
|
|
430
|
|
|||||
Amortization of loan fees
|
8,777
|
|
|
—
|
|
|
1,494
|
|
|
—
|
|
|
10,271
|
|
|||||
Amortization of debt discounts (premiums)
|
797
|
|
|
—
|
|
|
(3,203
|
)
|
|
—
|
|
|
(2,406
|
)
|
|||||
Amortization of acquired below-market leases
|
—
|
|
|
—
|
|
|
(21,938
|
)
|
|
—
|
|
|
(21,938
|
)
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
(93,883
|
)
|
|
—
|
|
|
(93,883
|
)
|
|||||
Stock compensation expense
|
35,019
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35,019
|
|
|||||
Equity in earnings of affiliates
|
(591,942
|
)
|
|
(455,574
|
)
|
|
(9,057
|
)
|
|
1,056,573
|
|
|
—
|
|
|||||
Investment income
|
—
|
|
|
(528
|
)
|
|
(136,235
|
)
|
|
—
|
|
|
(136,763
|
)
|
|||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Tenant receivables
|
—
|
|
|
—
|
|
|
435
|
|
|
—
|
|
|
435
|
|
|||||
Deferred leasing costs
|
—
|
|
|
—
|
|
|
(57,088
|
)
|
|
—
|
|
|
(57,088
|
)
|
|||||
Other assets
|
(14,701
|
)
|
|
—
|
|
|
(6,148
|
)
|
|
—
|
|
|
(20,849
|
)
|
|||||
Accounts payable, accrued expenses, and other liabilities
|
20,663
|
|
|
—
|
|
|
1,246
|
|
|
—
|
|
|
21,909
|
|
|||||
Net cash (used in) provided by operating activities
|
(154,913
|
)
|
|
—
|
|
|
725,252
|
|
|
—
|
|
|
570,339
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sales of real estate
|
—
|
|
|
—
|
|
|
20,190
|
|
|
—
|
|
|
20,190
|
|
|||||
Additions to real estate
|
—
|
|
|
—
|
|
|
(927,168
|
)
|
|
—
|
|
|
(927,168
|
)
|
|||||
Purchases of real estate
|
—
|
|
|
—
|
|
|
(1,037,180
|
)
|
|
—
|
|
|
(1,037,180
|
)
|
|||||
Deposits for investing activities
|
—
|
|
|
—
|
|
|
(2,000
|
)
|
|
—
|
|
|
(2,000
|
)
|
|||||
Investments in subsidiaries
|
(1,693,774
|
)
|
|
(1,463,063
|
)
|
|
(30,076
|
)
|
|
3,186,913
|
|
|
—
|
|
|||||
Acquisitions of interest in unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
(35,922
|
)
|
|
—
|
|
|
(35,922
|
)
|
|||||
Investments in unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
(116,008
|
)
|
|
—
|
|
|
(116,008
|
)
|
|||||
Return of capital from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
68,592
|
|
|
—
|
|
|
68,592
|
|
|||||
Additions to non-real estate investments
|
—
|
|
|
—
|
|
|
(235,943
|
)
|
|
—
|
|
|
(235,943
|
)
|
|||||
Sales of non-real estate investments
|
—
|
|
|
956
|
|
|
102,723
|
|
|
—
|
|
|
103,679
|
|
|||||
Net cash used in investing activities
|
$
|
(1,693,774
|
)
|
|
$
|
(1,462,107
|
)
|
|
$
|
(2,192,792
|
)
|
|
$
|
3,186,913
|
|
|
$
|
(2,161,760
|
)
|
22.
|
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
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,784
|
|
|
$
|
—
|
|
|
$
|
17,784
|
|
Repayments of borrowings from secured notes payable
|
—
|
|
|
—
|
|
|
(156,888
|
)
|
|
—
|
|
|
(156,888
|
)
|
|||||
Proceeds from issuance of unsecured senior notes payable
|
899,321
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
899,321
|
|
|||||
Borrowings from unsecured senior line of credit
|
4,741,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,741,000
|
|
|||||
Repayments of borrowings from unsecured senior line of credit
|
(4,583,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,583,000
|
)
|
|||||
Repayment of borrowings from unsecured senior bank term loan
|
(200,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(200,000
|
)
|
|||||
Transfer to/from parent company
|
105,961
|
|
|
1,462,098
|
|
|
1,618,854
|
|
|
(3,186,913
|
)
|
|
—
|
|
|||||
Payments of loan fees
|
(19,292
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,292
|
)
|
|||||
Repurchases of 7.00% Series D cumulative convertible preferred stock
|
(13,976
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13,976
|
)
|
|||||
Proceeds from the issuance of common stock
|
1,293,301
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,293,301
|
|
|||||
Dividends on common stock
|
(380,632
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(380,632
|
)
|
|||||
Dividends on preferred stock
|
(5,207
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,207
|
)
|
|||||
Contributions from and sales of noncontrolling interests
|
—
|
|
|
—
|
|
|
28,275
|
|
|
—
|
|
|
28,275
|
|
|||||
Distributions to and purchase of noncontrolling interests
|
—
|
|
|
—
|
|
|
(32,253
|
)
|
|
—
|
|
|
(32,253
|
)
|
|||||
Net cash provided by financing activities
|
1,837,476
|
|
|
1,462,098
|
|
|
1,475,772
|
|
|
(3,186,913
|
)
|
|
1,588,433
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
—
|
|
|
—
|
|
|
(2,068
|
)
|
|
—
|
|
|
(2,068
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net (decrease) increase in cash, cash equivalents, and restricted cash
|
(11,211
|
)
|
|
(9
|
)
|
|
6,164
|
|
|
—
|
|
|
(5,056
|
)
|
|||||
Cash, cash equivalents, and restricted cash as of the beginning of period
|
130,516
|
|
|
9
|
|
|
146,661
|
|
|
—
|
|
|
277,186
|
|
|||||
Cash, cash equivalents, and restricted cash as of the end of period
|
$
|
119,305
|
|
|
$
|
—
|
|
|
$
|
152,825
|
|
|
$
|
—
|
|
|
$
|
272,130
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Supplemental Disclosure and Non-Cash Investing and Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash paid during the period for interest, net of interest capitalized
|
$
|
104,935
|
|
|
$
|
—
|
|
|
$
|
22,158
|
|
|
$
|
—
|
|
|
$
|
127,093
|
|
Change in accrued construction
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
81,177
|
|
|
$
|
—
|
|
|
$
|
81,177
|
|
Accrued construction for current-period additions to real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
244,147
|
|
|
$
|
—
|
|
|
$
|
244,147
|
|
Payable for purchase of real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(65,000
|
)
|
|
$
|
—
|
|
|
$
|
(65,000
|
)
|
22.
|
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
|
$
|
169,093
|
|
|
$
|
325,655
|
|
|
$
|
371,993
|
|
|
$
|
(672,537
|
)
|
|
$
|
194,204
|
|
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
7,625
|
|
|
—
|
|
|
409,158
|
|
|
—
|
|
|
416,783
|
|
|||||
Loss on early extinguishment of debt
|
670
|
|
|
—
|
|
|
2,781
|
|
|
—
|
|
|
3,451
|
|
|||||
Impairment of real estate
|
—
|
|
|
—
|
|
|
203
|
|
|
—
|
|
|
203
|
|
|||||
Gains on sales of real estate – rental properties
|
—
|
|
|
—
|
|
|
(270
|
)
|
|
—
|
|
|
(270
|
)
|
|||||
Gains on sales of real estate – land parcels
|
—
|
|
|
—
|
|
|
(111
|
)
|
|
—
|
|
|
(111
|
)
|
|||||
Equity in earnings from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
(15,426
|
)
|
|
—
|
|
|
(15,426
|
)
|
|||||
Distributions of earnings from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
1,618
|
|
|
—
|
|
|
1,618
|
|
|||||
Amortization of loan fees
|
7,627
|
|
|
—
|
|
|
3,522
|
|
|
—
|
|
|
11,149
|
|
|||||
Amortization of debt discounts (premiums)
|
608
|
|
|
—
|
|
|
(3,120
|
)
|
|
—
|
|
|
(2,512
|
)
|
|||||
Amortization of acquired below-market leases
|
—
|
|
|
—
|
|
|
(19,055
|
)
|
|
—
|
|
|
(19,055
|
)
|
|||||
Deferred rent
|
—
|
|
|
—
|
|
|
(107,643
|
)
|
|
—
|
|
|
(107,643
|
)
|
|||||
Stock compensation expense
|
25,610
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,610
|
|
|||||
Equity in earnings of affiliates
|
(337,923
|
)
|
|
(328,230
|
)
|
|
(6,384
|
)
|
|
672,537
|
|
|
—
|
|
|||||
Investment income
|
—
|
|
|
2,575
|
|
|
(3,904
|
)
|
|
—
|
|
|
(1,329
|
)
|
|||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Tenant receivables
|
—
|
|
|
—
|
|
|
(502
|
)
|
|
—
|
|
|
(502
|
)
|
|||||
Deferred leasing costs
|
—
|
|
|
—
|
|
|
(62,639
|
)
|
|
—
|
|
|
(62,639
|
)
|
|||||
Other assets
|
(9,343
|
)
|
|
—
|
|
|
(8,879
|
)
|
|
—
|
|
|
(18,222
|
)
|
|||||
Accounts payable, accrued expenses, and other liabilities
|
(10,524
|
)
|
|
—
|
|
|
36,097
|
|
|
—
|
|
|
25,573
|
|
|||||
Net cash (used in) provided by operating activities
|
(146,557
|
)
|
|
—
|
|
|
597,439
|
|
|
—
|
|
|
450,882
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investing Activities
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sales of real estate
|
—
|
|
|
—
|
|
|
15,432
|
|
|
—
|
|
|
15,432
|
|
|||||
Additions to real estate
|
—
|
|
|
—
|
|
|
(893,685
|
)
|
|
—
|
|
|
(893,685
|
)
|
|||||
Purchases of real estate
|
—
|
|
|
—
|
|
|
(675,584
|
)
|
|
—
|
|
|
(675,584
|
)
|
|||||
Deposits for investing activities
|
—
|
|
|
—
|
|
|
(2,300
|
)
|
|
—
|
|
|
(2,300
|
)
|
|||||
Investments in subsidiaries
|
(1,458,973
|
)
|
|
(1,257,845
|
)
|
|
(25,872
|
)
|
|
2,742,690
|
|
|
—
|
|
|||||
Acquisition of interest in unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
(60,291
|
)
|
|
—
|
|
|
(60,291
|
)
|
|||||
Investments in unconsolidated real estate joint ventures
|
—
|
|
|
—
|
|
|
(17,876
|
)
|
|
—
|
|
|
(17,876
|
)
|
|||||
Return of capital from unconsolidated real estate JVs
|
—
|
|
|
—
|
|
|
38,576
|
|
|
—
|
|
|
38,576
|
|
|||||
Additions to non-real estate investments
|
—
|
|
|
—
|
|
|
(171,881
|
)
|
|
—
|
|
|
(171,881
|
)
|
|||||
Sales of non-real estate investments
|
—
|
|
|
208
|
|
|
30,275
|
|
|
—
|
|
|
30,483
|
|
|||||
Net cash used in investing activities
|
$
|
(1,458,973
|
)
|
|
$
|
(1,257,637
|
)
|
|
$
|
(1,763,206
|
)
|
|
$
|
2,742,690
|
|
|
$
|
(1,737,126
|
)
|
22.
|
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
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
153,405
|
|
|
$
|
—
|
|
|
$
|
153,405
|
|
Repayments of borrowings from secured notes payable
|
—
|
|
|
—
|
|
|
(396,240
|
)
|
|
—
|
|
|
(396,240
|
)
|
|||||
Proceeds from issuance of unsecured senior notes payable
|
1,023,262
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,023,262
|
|
|||||
Borrowings from unsecured senior line of credit
|
3,858,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,858,000
|
|
|||||
Repayments of borrowings from unsecured senior line of credit
|
(3,836,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,836,000
|
)
|
|||||
Repayment of borrowings from unsecured senior bank term loan
|
(200,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(200,000
|
)
|
|||||
Transfer to/from parent company
|
64,156
|
|
|
1,257,646
|
|
|
1,420,888
|
|
|
(2,742,690
|
)
|
|
—
|
|
|||||
Payments of loan fees
|
(9,440
|
)
|
|
—
|
|
|
(579
|
)
|
|
—
|
|
|
(10,019
|
)
|
|||||
Repurchases of 7.00% Series D cumulative convertible preferred stock
|
(17,934
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,934
|
)
|
|||||
Redemption of 6.45% Series E cumulative redeemable preferred stock
|
(130,350
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(130,350
|
)
|
|||||
Proceeds from the issuance of common stock
|
1,275,397
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,275,397
|
|
|||||
Dividends on common stock
|
(312,131
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(312,131
|
)
|
|||||
Dividends on preferred stock
|
(9,619
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,619
|
)
|
|||||
Contributions from and sales of noncontrolling interests
|
—
|
|
|
—
|
|
|
44,931
|
|
|
—
|
|
|
44,931
|
|
|||||
Distributions to and purchases of noncontrolling interests
|
—
|
|
|
—
|
|
|
(22,361
|
)
|
|
—
|
|
|
(22,361
|
)
|
|||||
Net cash provided by financing activities
|
1,705,341
|
|
|
1,257,646
|
|
|
1,200,044
|
|
|
(2,742,690
|
)
|
|
1,420,341
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
—
|
|
|
—
|
|
|
1,723
|
|
|
—
|
|
|
1,723
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net increase in cash, cash equivalents, and restricted cash
|
99,811
|
|
|
9
|
|
|
36,000
|
|
|
—
|
|
|
135,820
|
|
|||||
Cash, cash equivalents, and restricted cash as of the beginning of period
|
30,705
|
|
|
—
|
|
|
110,661
|
|
|
—
|
|
|
141,366
|
|
|||||
Cash, cash equivalents, and restricted cash as of the end of period
|
$
|
130,516
|
|
|
$
|
9
|
|
|
$
|
146,661
|
|
|
$
|
—
|
|
|
$
|
277,186
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Supplemental Disclosure and Non-Cash Investing and Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash paid during the period for interest, net of interest capitalized
|
$
|
85,705
|
|
|
$
|
—
|
|
|
$
|
26,408
|
|
|
$
|
—
|
|
|
$
|
112,113
|
|
Change in accrued construction
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(11,034
|
)
|
|
$
|
—
|
|
|
$
|
(11,034
|
)
|
Accrued construction for current-period additions to real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
179,154
|
|
|
$
|
—
|
|
|
$
|
179,154
|
|
Contribution of real estate from noncontrolling interests
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,597
|
|
|
$
|
—
|
|
|
$
|
8,597
|
|
Contribution of real estate to an unconsolidated real estate JV
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,998
|
|
|
$
|
—
|
|
|
$
|
6,998
|
|
|
|
|
|
|
|
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
|
|
$
|
—
|
|
|
$
|
279,668
|
|
|
$
|
205,491
|
|
|
$
|
1,440,945
|
|
|
$
|
279,668
|
|
|
$
|
1,646,436
|
|
|
$
|
1,926,104
|
|
|
$
|
(241,801
|
)
|
|
$
|
1,684,303
|
|
|
2000 - 2017
|
|
2005 - 2015
|
Alexandria Technology Square®
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
619,658
|
|
|
234,311
|
|
|
—
|
|
|
853,969
|
|
|
853,969
|
|
|
(251,017
|
)
|
|
602,952
|
|
|
2001 - 2012
|
|
2006
|
|||||||||
The Arsenal on the Charles
|
|
Greater Boston
|
|
—
|
|
|
181,797
|
|
|
354,611
|
|
|
1,464
|
|
|
181,797
|
|
|
356,075
|
|
|
537,872
|
|
|
—
|
|
|
537,872
|
|
|
2000 - 2017
|
|
2019
|
|||||||||
Alexandria Center® at One Kendall Square
|
|
Greater Boston
|
|
208,411
|
|
|
349,952
|
|
|
483,816
|
|
|
282,309
|
|
|
349,952
|
|
|
766,125
|
|
|
1,116,077
|
|
|
(80,606
|
)
|
|
1,035,471
|
|
|
1985 - 2019
|
|
2016 - 2017
|
|||||||||
480 and 500 Arsenal Street
|
|
Greater Boston
|
|
—
|
|
|
9,773
|
|
|
12,773
|
|
|
88,226
|
|
|
9,773
|
|
|
100,999
|
|
|
110,772
|
|
|
(40,689
|
)
|
|
70,083
|
|
|
2001 - 2003
|
|
2000 - 2001
|
|||||||||
640 Memorial Drive
|
|
Greater Boston
|
|
81,175
|
|
|
—
|
|
|
174,878
|
|
|
741
|
|
|
—
|
|
|
175,619
|
|
|
175,619
|
|
|
(36,598
|
)
|
|
139,021
|
|
|
2011
|
|
2015
|
|||||||||
780 and 790 Memorial Drive
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
—
|
|
|
54,490
|
|
|
—
|
|
|
54,490
|
|
|
54,490
|
|
|
(24,387
|
)
|
|
30,103
|
|
|
2002
|
|
2001
|
|||||||||
167 Sidney Street and 99 Erie Street
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
12,613
|
|
|
13,733
|
|
|
—
|
|
|
26,346
|
|
|
26,346
|
|
|
(7,383
|
)
|
|
18,963
|
|
|
2006 - 2012
|
|
2005 - 2006
|
|||||||||
79/96 13th Street (Charlestown Navy Yard)
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
6,247
|
|
|
8,706
|
|
|
—
|
|
|
14,953
|
|
|
14,953
|
|
|
(5,661
|
)
|
|
9,292
|
|
|
2012
|
|
1998
|
|||||||||
5 Necco Street
|
|
Greater Boston
|
|
—
|
|
|
41,958
|
|
|
41,546
|
|
|
582
|
|
|
41,958
|
|
|
42,128
|
|
|
84,086
|
|
|
(250
|
)
|
|
83,836
|
|
|
2019
|
|
2019
|
|||||||||
10 Necco Street
|
|
Greater Boston
|
|
—
|
|
|
67,743
|
|
|
13,357
|
|
|
4,202
|
|
|
67,743
|
|
|
17,559
|
|
|
85,302
|
|
|
(255
|
)
|
|
85,047
|
|
|
N/A
|
|
2019
|
|||||||||
15 Necco Street
|
|
Greater Boston
|
|
—
|
|
|
—
|
|
|
—
|
|
|
172,114
|
|
|
—
|
|
|
172,114
|
|
|
172,114
|
|
|
—
|
|
|
172,114
|
|
|
N/A
|
|
2019
|
|||||||||
99 A Street
|
|
Greater Boston
|
|
—
|
|
|
31,671
|
|
|
878
|
|
|
9,306
|
|
|
31,671
|
|
|
10,184
|
|
|
41,855
|
|
|
(938
|
)
|
|
40,917
|
|
|
1968
|
|
2018
|
|||||||||
Alexandria Park at 128
|
|
Greater Boston
|
|
—
|
|
|
10,439
|
|
|
41,596
|
|
|
79,501
|
|
|
10,439
|
|
|
121,097
|
|
|
131,536
|
|
|
(44,353
|
)
|
|
87,183
|
|
|
1997 - 2010
|
|
1998 - 2008
|
|||||||||
225, 266, and 275 Second Avenue
|
|
Greater Boston
|
|
—
|
|
|
17,086
|
|
|
69,994
|
|
|
60,552
|
|
|
17,086
|
|
|
130,546
|
|
|
147,632
|
|
|
(19,074
|
)
|
|
128,558
|
|
|
2014 - 2018
|
|
2014 - 2017
|
|||||||||
100 Tech Drive
|
|
Greater Boston
|
|
—
|
|
|
11,977
|
|
|
85,620
|
|
|
235
|
|
|
11,977
|
|
|
85,855
|
|
|
97,832
|
|
|
(4,765
|
)
|
|
93,067
|
|
|
2015
|
|
2018
|
|||||||||
19 Presidential Way
|
|
Greater Boston
|
|
—
|
|
|
12,833
|
|
|
27,333
|
|
|
23,133
|
|
|
12,833
|
|
|
50,466
|
|
|
63,299
|
|
|
(17,114
|
)
|
|
46,185
|
|
|
1999
|
|
2005
|
|||||||||
100 Beaver Street
|
|
Greater Boston
|
|
—
|
|
|
1,466
|
|
|
9,046
|
|
|
22,201
|
|
|
1,466
|
|
|
31,247
|
|
|
32,713
|
|
|
(7,129
|
)
|
|
25,584
|
|
|
2006
|
|
2005
|
|||||||||
285 Bear Hill Road
|
|
Greater Boston
|
|
—
|
|
|
422
|
|
|
3,538
|
|
|
6,905
|
|
|
422
|
|
|
10,443
|
|
|
10,865
|
|
|
(2,417
|
)
|
|
8,448
|
|
|
2013
|
|
2011
|
|||||||||
111 and 130 Forbes Boulevard
|
|
Greater Boston
|
|
—
|
|
|
3,146
|
|
|
15,725
|
|
|
3,165
|
|
|
3,146
|
|
|
18,890
|
|
|
22,036
|
|
|
(6,284
|
)
|
|
15,752
|
|
|
2006
|
|
2006 - 2007
|
|||||||||
20 Walkup Drive
|
|
Greater Boston
|
|
—
|
|
|
2,261
|
|
|
7,099
|
|
|
9,029
|
|
|
2,261
|
|
|
16,128
|
|
|
18,389
|
|
|
(3,833
|
)
|
|
14,556
|
|
|
2012
|
|
2006
|
|||||||||
30 Bearfoot Road
|
|
Greater Boston
|
|
—
|
|
|
1,220
|
|
|
22,375
|
|
|
59
|
|
|
1,220
|
|
|
22,434
|
|
|
23,654
|
|
|
(21,533
|
)
|
|
2,121
|
|
|
2000
|
|
2005
|
|||||||||
Alexandria Center® for Science and Technology – Mission Bay
|
|
San Francisco
|
|
—
|
|
|
211,450
|
|
|
210,211
|
|
|
442,961
|
|
|
211,450
|
|
|
653,172
|
|
|
864,622
|
|
|
(145,182
|
)
|
|
719,440
|
|
|
2007 - 2014
|
|
2004 - 2017
|
|||||||||
510 Townsend Street
|
|
San Francisco
|
|
—
|
|
|
52,105
|
|
|
—
|
|
|
174,287
|
|
|
52,105
|
|
|
174,287
|
|
|
226,392
|
|
|
(12,754
|
)
|
|
213,638
|
|
|
2017
|
|
2014
|
|||||||||
945 Market Street
|
|
San Francisco
|
|
—
|
|
|
99,294
|
|
|
86,360
|
|
|
5,770
|
|
|
99,294
|
|
|
92,130
|
|
|
191,424
|
|
|
—
|
|
|
191,424
|
|
|
2016
|
|
2019
|
|||||||||
505 Brannan Street
|
|
San Francisco
|
|
—
|
|
|
31,710
|
|
|
2,540
|
|
|
107,671
|
|
|
31,710
|
|
|
110,211
|
|
|
141,921
|
|
|
(6,726
|
)
|
|
135,195
|
|
|
2017
|
|
2015
|
|||||||||
260 Townsend Street
|
|
San Francisco
|
|
27,561
|
|
|
26,392
|
|
|
33,921
|
|
|
471
|
|
|
26,392
|
|
|
34,392
|
|
|
60,784
|
|
|
(714
|
)
|
|
60,070
|
|
|
2017
|
|
2019
|
|||||||||
88 Bluxome Street
|
|
San Francisco
|
|
—
|
|
|
148,551
|
|
|
21,514
|
|
|
52,292
|
|
|
148,551
|
|
|
73,806
|
|
|
222,357
|
|
|
(7,951
|
)
|
|
214,406
|
|
|
N/A
|
|
2017
|
|||||||||
213, 249, 259, 269, and 279 East Grand Avenue
|
|
San Francisco
|
|
—
|
|
|
59,199
|
|
|
—
|
|
|
542,156
|
|
|
59,199
|
|
|
542,156
|
|
|
601,355
|
|
|
(47,537
|
)
|
|
553,818
|
|
|
2008 - 2019
|
|
2004
|
|
|
|
|
|
|
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 Technology Center® – Gateway
|
|
San Francisco
|
|
—
|
|
|
71,005
|
|
|
168,894
|
|
|
101,122
|
|
|
71,005
|
|
|
270,016
|
|
|
341,021
|
|
|
(65,979
|
)
|
|
275,042
|
|
|
1998 - 2019
|
|
2002 - 2017
|
|||||||||
201 Haskins Way
|
|
San Francisco
|
|
—
|
|
|
32,245
|
|
|
1,287
|
|
|
118,801
|
|
|
32,245
|
|
|
120,088
|
|
|
152,333
|
|
|
(1,445
|
)
|
|
150,888
|
|
|
N/A
|
|
2017
|
|||||||||
400 and 450 East Jamie Court
|
|
San Francisco
|
|
—
|
|
|
—
|
|
|
—
|
|
|
117,282
|
|
|
—
|
|
|
117,282
|
|
|
117,282
|
|
|
(47,091
|
)
|
|
70,191
|
|
|
2012
|
|
2002
|
|||||||||
500 Forbes Boulevard
|
|
San Francisco
|
|
—
|
|
|
35,596
|
|
|
69,091
|
|
|
17,503
|
|
|
35,596
|
|
|
86,594
|
|
|
122,190
|
|
|
(27,166
|
)
|
|
95,024
|
|
|
2001
|
|
2007
|
|||||||||
7000 Shoreline Court
|
|
San Francisco
|
|
—
|
|
|
7,038
|
|
|
39,704
|
|
|
19,454
|
|
|
7,038
|
|
|
59,158
|
|
|
66,196
|
|
|
(19,317
|
)
|
|
46,879
|
|
|
2001
|
|
2004
|
|||||||||
341 and 343 Oyster Point Boulevard
|
|
San Francisco
|
|
—
|
|
|
7,038
|
|
|
—
|
|
|
43,433
|
|
|
7,038
|
|
|
43,433
|
|
|
50,471
|
|
|
(17,640
|
)
|
|
32,831
|
|
|
2009 - 2013
|
|
2000
|
|||||||||
849/863 Mitten Road/866 Malcolm Road
|
|
San Francisco
|
|
—
|
|
|
3,211
|
|
|
8,665
|
|
|
24,070
|
|
|
3,211
|
|
|
32,735
|
|
|
35,946
|
|
|
(13,318
|
)
|
|
22,628
|
|
|
2012
|
|
1998
|
|||||||||
Alexandria District for Science and Technology
|
|
San Francisco
|
|
—
|
|
|
87,566
|
|
|
—
|
|
|
190,881
|
|
|
87,566
|
|
|
190,881
|
|
|
278,447
|
|
|
—
|
|
|
278,447
|
|
|
N/A
|
|
2017
|
|||||||||
3825 and 3875 Fabian Way
|
|
San Francisco
|
|
—
|
|
|
194,424
|
|
|
54,519
|
|
|
872
|
|
|
194,424
|
|
|
55,391
|
|
|
249,815
|
|
|
(119
|
)
|
|
249,696
|
|
|
1969 - 2014
|
|
2019
|
|||||||||
Alexandria Stanford Life Science District
|
|
San Francisco
|
|
—
|
|
|
—
|
|
|
152,437
|
|
|
5,536
|
|
|
—
|
|
|
157,973
|
|
|
157,973
|
|
|
(11,248
|
)
|
|
146,725
|
|
|
1998 - 2017
|
|
2003 - 2019
|
|||||||||
Alexandria PARC
|
|
San Francisco
|
|
—
|
|
|
72,859
|
|
|
53,309
|
|
|
16,637
|
|
|
72,859
|
|
|
69,946
|
|
|
142,805
|
|
|
(3,265
|
)
|
|
139,540
|
|
|
1984 - 2019
|
|
2018
|
|||||||||
960 Industrial Road
|
|
San Francisco
|
|
—
|
|
|
79,969
|
|
|
5,558
|
|
|
19,589
|
|
|
79,969
|
|
|
25,147
|
|
|
105,116
|
|
|
(4,852
|
)
|
|
100,264
|
|
|
N/A
|
|
2017
|
|||||||||
2425 Garcia Avenue & 2400/2450 Bayshore Parkway
|
|
San Francisco
|
|
728
|
|
|
1,512
|
|
|
21,323
|
|
|
26,261
|
|
|
1,512
|
|
|
47,584
|
|
|
49,096
|
|
|
(22,637
|
)
|
|
26,459
|
|
|
2008
|
|
1999
|
|||||||||
Shoreway Science Center
|
|
San Francisco
|
|
—
|
|
|
20,049
|
|
|
48,554
|
|
|
152
|
|
|
20,049
|
|
|
48,706
|
|
|
68,755
|
|
|
(1,262
|
)
|
|
67,493
|
|
|
2016
|
|
2019
|
|||||||||
1450 Page Mill Road
|
|
San Francisco
|
|
—
|
|
|
—
|
|
|
84,467
|
|
|
104
|
|
|
—
|
|
|
84,571
|
|
|
84,571
|
|
|
(5,590
|
)
|
|
78,981
|
|
|
2017
|
|
2017
|
|||||||||
3350 West Bayshore Road
|
|
San Francisco
|
|
—
|
|
|
4,800
|
|
|
6,693
|
|
|
20,325
|
|
|
4,800
|
|
|
27,018
|
|
|
31,818
|
|
|
(5,726
|
)
|
|
26,092
|
|
|
1982
|
|
2005
|
|||||||||
2625/2627/2631 Hanover Street
|
|
San Francisco
|
|
—
|
|
|
—
|
|
|
6,628
|
|
|
11,910
|
|
|
—
|
|
|
18,538
|
|
|
18,538
|
|
|
(10,424
|
)
|
|
8,114
|
|
|
2000
|
|
1999
|
|||||||||
Alexandria Center® for Life Science
|
|
New York City
|
|
—
|
|
|
—
|
|
|
—
|
|
|
848,102
|
|
|
—
|
|
|
848,102
|
|
|
848,102
|
|
|
(170,156
|
)
|
|
677,946
|
|
|
2010 - 2016
|
|
2006
|
|||||||||
219 East 42nd Street
|
|
New York City
|
|
—
|
|
|
141,266
|
|
|
63,312
|
|
|
2,149
|
|
|
141,266
|
|
|
65,461
|
|
|
206,727
|
|
|
(13,573
|
)
|
|
193,154
|
|
|
1995
|
|
2018
|
|||||||||
47-50 30th Street
|
|
New York City
|
|
—
|
|
|
25,000
|
|
|
—
|
|
|
2,120
|
|
|
25,000
|
|
|
2,120
|
|
|
27,120
|
|
|
—
|
|
|
27,120
|
|
|
1942
|
|
2019
|
|||||||||
Alexandria Center® – Long Island City
|
|
New York City
|
|
—
|
|
|
22,746
|
|
|
53,093
|
|
|
13,283
|
|
|
22,746
|
|
|
66,376
|
|
|
89,122
|
|
|
(369
|
)
|
|
88,753
|
|
|
N/A
|
|
2018
|
|||||||||
ARE Spectrum
|
|
San Diego
|
|
—
|
|
|
32,361
|
|
|
80,957
|
|
|
203,705
|
|
|
32,361
|
|
|
284,662
|
|
|
317,023
|
|
|
(55,306
|
)
|
|
261,717
|
|
|
2008 - 2017
|
|
2007 - 2017
|
|||||||||
ARE Torrey Ridge
|
|
San Diego
|
|
—
|
|
|
22,124
|
|
|
152,840
|
|
|
52,470
|
|
|
22,124
|
|
|
205,310
|
|
|
227,434
|
|
|
(32,702
|
)
|
|
194,732
|
|
|
2003 - 2004
|
|
2016
|
|||||||||
ARE Sunrise
|
|
San Diego
|
|
—
|
|
|
6,118
|
|
|
17,947
|
|
|
82,874
|
|
|
6,118
|
|
|
100,821
|
|
|
106,939
|
|
|
(51,853
|
)
|
|
55,086
|
|
|
2000 - 2015
|
|
1994 - 2004
|
|||||||||
ARE Nautilus
|
|
San Diego
|
|
—
|
|
|
6,684
|
|
|
27,600
|
|
|
123,685
|
|
|
6,684
|
|
|
151,285
|
|
|
157,969
|
|
|
(44,910
|
)
|
|
113,059
|
|
|
2009 - 2012
|
|
1994 - 1997
|
|||||||||
3545 Cray Court
|
|
San Diego
|
|
31,477
|
|
|
7,056
|
|
|
53,944
|
|
|
11,537
|
|
|
7,056
|
|
|
65,481
|
|
|
72,537
|
|
|
(40,636
|
)
|
|
31,901
|
|
|
1998
|
|
2014
|
|||||||||
11119 North Torrey Pines Road
|
|
San Diego
|
|
—
|
|
|
9,994
|
|
|
37,099
|
|
|
34,147
|
|
|
9,994
|
|
|
71,246
|
|
|
81,240
|
|
|
(20,799
|
)
|
|
60,441
|
|
|
2012
|
|
2007
|
|||||||||
Campus Pointe by Alexandria
|
|
San Diego
|
|
—
|
|
|
88,016
|
|
|
393,713
|
|
|
441,342
|
|
|
88,016
|
|
|
835,055
|
|
|
923,071
|
|
|
(110,603
|
)
|
|
812,468
|
|
|
1988 - 2019
|
|
2010 - 2019
|
|||||||||
5200 Illumina Way
|
|
San Diego
|
|
—
|
|
|
38,340
|
|
|
96,606
|
|
|
195,156
|
|
|
38,340
|
|
|
291,762
|
|
|
330,102
|
|
|
(49,000
|
)
|
|
281,102
|
|
|
2004 - 2017
|
|
2010
|
|||||||||
University District
|
|
San Diego
|
|
—
|
|
|
18,221
|
|
|
48,840
|
|
|
203,245
|
|
|
18,221
|
|
|
252,085
|
|
|
270,306
|
|
|
(82,398
|
)
|
|
187,908
|
|
|
1989 - 2018
|
|
1998 - 2014
|
|||||||||
SD Tech by Alexandria
|
|
San Diego
|
|
—
|
|
|
54,648
|
|
|
169,485
|
|
|
4,835
|
|
|
54,648
|
|
|
174,320
|
|
|
228,968
|
|
|
(563
|
)
|
|
228,405
|
|
|
2014
|
|
2019
|
|||||||||
Summers Ridge Science Park
|
|
San Diego
|
|
—
|
|
|
21,154
|
|
|
102,046
|
|
|
3,491
|
|
|
21,154
|
|
|
105,537
|
|
|
126,691
|
|
|
(5,277
|
)
|
|
121,414
|
|
|
2005
|
|
2018
|
|||||||||
10121 and 10151 Barnes Canyon Road
|
|
San Diego
|
|
—
|
|
|
4,608
|
|
|
5,100
|
|
|
19,110
|
|
|
4,608
|
|
|
24,210
|
|
|
28,818
|
|
|
(4,103
|
)
|
|
24,715
|
|
|
1988 - 2014
|
|
2013
|
|
|
|
|
|
|
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
|
||||||||||||||||||
ARE Portola
|
|
San Diego
|
|
—
|
|
|
6,991
|
|
|
25,153
|
|
|
39,893
|
|
|
6,991
|
|
|
65,046
|
|
|
72,037
|
|
|
(12,389
|
)
|
|
59,648
|
|
|
2005 - 2012
|
|
2007
|
|||||||||
5810/5820 Nancy Ridge Drive
|
|
San Diego
|
|
—
|
|
|
5,476
|
|
|
28,682
|
|
|
(52
|
)
|
|
5,476
|
|
|
28,630
|
|
|
34,106
|
|
|
(10,137
|
)
|
|
23,969
|
|
|
2000 - 2001
|
|
2003 - 2004
|
|||||||||
7330 Carroll Road
|
|
San Diego
|
|
—
|
|
|
2,650
|
|
|
19,878
|
|
|
1,912
|
|
|
2,650
|
|
|
21,790
|
|
|
24,440
|
|
|
(5,860
|
)
|
|
18,580
|
|
|
2007
|
|
2010
|
|||||||||
5871 Oberlin Drive
|
|
San Diego
|
|
—
|
|
|
1,349
|
|
|
8,016
|
|
|
6,019
|
|
|
1,349
|
|
|
14,035
|
|
|
15,384
|
|
|
(2,232
|
)
|
|
13,152
|
|
|
2004
|
|
2010
|
|||||||||
Vista Wateridge I & II
|
|
San Diego
|
|
—
|
|
|
3,286
|
|
|
—
|
|
|
735
|
|
|
3,286
|
|
|
735
|
|
|
4,021
|
|
|
—
|
|
|
4,021
|
|
|
N/A
|
|
2017
|
|||||||||
3911, 3931, 3985, 4025, 4031, 4045, and 4075 Sorrento Valley Boulevard
|
|
San Diego
|
|
—
|
|
|
18,177
|
|
|
35,178
|
|
|
31,920
|
|
|
18,177
|
|
|
67,098
|
|
|
85,275
|
|
|
(24,580
|
)
|
|
60,695
|
|
|
2007 - 2015
|
|
2010 - 2019
|
|||||||||
11025, 11035, 11045, 11055, 11065, and 11075 Roselle Street
|
|
San Diego
|
|
—
|
|
|
4,156
|
|
|
11,571
|
|
|
42,744
|
|
|
4,156
|
|
|
54,315
|
|
|
58,471
|
|
|
(12,252
|
)
|
|
46,219
|
|
|
2006 - 2014
|
|
1997 - 2014
|
|||||||||
13112 Evening Creek Drive
|
|
San Diego
|
|
—
|
|
|
7,393
|
|
|
27,950
|
|
|
232
|
|
|
7,393
|
|
|
28,182
|
|
|
35,575
|
|
|
(13,055
|
)
|
|
22,520
|
|
|
2007
|
|
2007
|
|||||||||
Townsgate by Alexandria
|
|
San Diego
|
|
—
|
|
|
16,416
|
|
|
—
|
|
|
3,620
|
|
|
16,416
|
|
|
3,620
|
|
|
20,036
|
|
|
—
|
|
|
20,036
|
|
|
N/A
|
|
2018
|
|||||||||
The Eastlake Life Science Campus by Alexandria - North Campus
|
|
Seattle
|
|
—
|
|
|
24,205
|
|
|
35,296
|
|
|
391,761
|
|
|
24,205
|
|
|
427,057
|
|
|
451,262
|
|
|
(85,863
|
)
|
|
365,399
|
|
|
2007 - 2019
|
|
2003 - 2015
|
|||||||||
The Eastlake Life Science Campus by Alexandria - South Campus
|
|
Seattle
|
|
—
|
|
|
22,987
|
|
|
47,149
|
|
|
100,758
|
|
|
22,987
|
|
|
147,907
|
|
|
170,894
|
|
|
(45,301
|
)
|
|
125,593
|
|
|
1997
|
|
2002 - 2008
|
|||||||||
400 Dexter Avenue North
|
|
Seattle
|
|
—
|
|
|
11,342
|
|
|
—
|
|
|
211,045
|
|
|
11,342
|
|
|
211,045
|
|
|
222,387
|
|
|
(20,303
|
)
|
|
202,084
|
|
|
2017
|
|
2007
|
|||||||||
2301 5th Avenue
|
|
Seattle
|
|
—
|
|
|
6,543
|
|
|
76,180
|
|
|
1,130
|
|
|
6,543
|
|
|
77,310
|
|
|
83,853
|
|
|
(2,980
|
)
|
|
80,873
|
|
|
2002
|
|
2018
|
|||||||||
219 Terry Avenue North
|
|
Seattle
|
|
—
|
|
|
1,819
|
|
|
2,302
|
|
|
19,892
|
|
|
1,819
|
|
|
22,194
|
|
|
24,013
|
|
|
(7,143
|
)
|
|
16,870
|
|
|
2012
|
|
2007
|
|||||||||
601 Dexter Avenue North
|
|
Seattle
|
|
—
|
|
|
29,412
|
|
|
408
|
|
|
1,541
|
|
|
29,412
|
|
|
1,949
|
|
|
31,361
|
|
|
—
|
|
|
31,361
|
|
|
1985
|
|
2019
|
|||||||||
701 Dexter Avenue North
|
|
Seattle
|
|
—
|
|
|
35,316
|
|
|
719
|
|
|
6,149
|
|
|
35,316
|
|
|
6,868
|
|
|
42,184
|
|
|
(340
|
)
|
|
41,844
|
|
|
1984
|
|
2018
|
|||||||||
3000/3018 Western Avenue
|
|
Seattle
|
|
—
|
|
|
1,432
|
|
|
7,497
|
|
|
24,181
|
|
|
1,432
|
|
|
31,678
|
|
|
33,110
|
|
|
(16,287
|
)
|
|
16,823
|
|
|
2000
|
|
1998
|
|||||||||
410 West Harrison/410 Elliott Avenue West
|
|
Seattle
|
|
—
|
|
|
3,857
|
|
|
1,989
|
|
|
11,266
|
|
|
3,857
|
|
|
13,255
|
|
|
17,112
|
|
|
(5,707
|
)
|
|
11,405
|
|
|
2006 - 2008
|
|
2004
|
|||||||||
9800, 9900, 9920 and 9950 Medical Center Drive
|
|
Maryland
|
|
—
|
|
|
20,219
|
|
|
112,543
|
|
|
180,483
|
|
|
20,219
|
|
|
293,026
|
|
|
313,245
|
|
|
(76,214
|
)
|
|
237,031
|
|
|
1985 - 2018
|
|
2004 - 2017
|
|||||||||
9704, 9708, 9712, and 9714 Medical Center Drive
|
|
Maryland
|
|
—
|
|
|
10,258
|
|
|
74,173
|
|
|
766
|
|
|
10,258
|
|
|
74,939
|
|
|
85,197
|
|
|
(3,229
|
)
|
|
81,968
|
|
|
2015
|
|
2018
|
|||||||||
1330 Piccard Drive
|
|
Maryland
|
|
—
|
|
|
2,800
|
|
|
11,533
|
|
|
34,933
|
|
|
2,800
|
|
|
46,466
|
|
|
49,266
|
|
|
(18,830
|
)
|
|
30,436
|
|
|
2005
|
|
1997
|
|||||||||
1500 and 1550 East Gude Drive
|
|
Maryland
|
|
—
|
|
|
1,523
|
|
|
7,731
|
|
|
6,445
|
|
|
1,523
|
|
|
14,176
|
|
|
15,699
|
|
|
(8,979
|
)
|
|
6,720
|
|
|
1995 - 2003
|
|
1997
|
|||||||||
14920 and 15010 Broschart Road
|
|
Maryland
|
|
—
|
|
|
4,904
|
|
|
15,846
|
|
|
5,471
|
|
|
4,904
|
|
|
21,317
|
|
|
26,221
|
|
|
(5,979
|
)
|
|
20,242
|
|
|
1998 - 1999
|
|
2004 - 2010
|
|||||||||
1405 Research Boulevard
|
|
Maryland
|
|
—
|
|
|
899
|
|
|
21,946
|
|
|
14,363
|
|
|
899
|
|
|
36,309
|
|
|
37,208
|
|
|
(14,621
|
)
|
|
22,587
|
|
|
2006
|
|
1997
|
|||||||||
5 Research Place
|
|
Maryland
|
|
—
|
|
|
1,466
|
|
|
5,708
|
|
|
28,981
|
|
|
1,466
|
|
|
34,689
|
|
|
36,155
|
|
|
(14,768
|
)
|
|
21,387
|
|
|
2010
|
|
2001
|
|||||||||
5 Research Court
|
|
Maryland
|
|
—
|
|
|
1,647
|
|
|
13,258
|
|
|
24,060
|
|
|
1,647
|
|
|
37,318
|
|
|
38,965
|
|
|
(14,379
|
)
|
|
24,586
|
|
|
2007
|
|
2004
|
|||||||||
9920 Belward Campus Drive
|
|
Maryland
|
|
—
|
|
|
2,732
|
|
|
12,308
|
|
|
76
|
|
|
2,732
|
|
|
12,384
|
|
|
15,116
|
|
|
(527
|
)
|
|
14,589
|
|
|
2007
|
|
2018
|
|||||||||
12301 Parklawn Drive
|
|
Maryland
|
|
—
|
|
|
1,476
|
|
|
7,267
|
|
|
1,184
|
|
|
1,476
|
|
|
8,451
|
|
|
9,927
|
|
|
(2,949
|
)
|
|
6,978
|
|
|
2007
|
|
2004
|
|||||||||
14200 Shady Grove Road
|
|
Maryland
|
|
—
|
|
|
25,000
|
|
|
—
|
|
|
903
|
|
|
25,000
|
|
|
903
|
|
|
25,903
|
|
|
—
|
|
|
25,903
|
|
|
N/A
|
|
2019
|
|||||||||
Alexandria Technology Center® – Gaithersburg I
|
|
Maryland
|
|
—
|
|
|
20,980
|
|
|
121,952
|
|
|
39,799
|
|
|
20,980
|
|
|
161,751
|
|
|
182,731
|
|
|
(36,204
|
)
|
|
146,527
|
|
|
1992 - 2019
|
|
1997 - 2019
|
|||||||||
Alexandria Technology Center® – Gaithersburg II
|
|
Maryland
|
|
—
|
|
|
6,938
|
|
|
34,685
|
|
|
33,085
|
|
|
6,938
|
|
|
67,770
|
|
|
74,708
|
|
|
(27,742
|
)
|
|
46,966
|
|
|
2000 - 2015
|
|
1997 - 2018
|
|
|
|
|
|
|
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
|
||||||||||||||||||
401 Professional Drive
|
|
Maryland
|
|
—
|
|
|
1,129
|
|
|
6,941
|
|
|
10,125
|
|
|
1,129
|
|
|
17,066
|
|
|
18,195
|
|
|
(7,192
|
)
|
|
11,003
|
|
|
2007
|
|
1996
|
|||||||||
950 Wind River Lane
|
|
Maryland
|
|
—
|
|
|
2,400
|
|
|
10,620
|
|
|
1,050
|
|
|
2,400
|
|
|
11,670
|
|
|
14,070
|
|
|
(3,348
|
)
|
|
10,722
|
|
|
2009
|
|
2010
|
|||||||||
620 Professional Drive
|
|
Maryland
|
|
—
|
|
|
784
|
|
|
4,705
|
|
|
7,353
|
|
|
784
|
|
|
12,058
|
|
|
12,842
|
|
|
(5,490
|
)
|
|
7,352
|
|
|
2012
|
|
2005
|
|||||||||
8000/9000/10000 Virginia Manor Road
|
|
Maryland
|
|
—
|
|
|
—
|
|
|
13,679
|
|
|
7,189
|
|
|
—
|
|
|
20,868
|
|
|
20,868
|
|
|
(10,460
|
)
|
|
10,408
|
|
|
2003
|
|
1998
|
|||||||||
14225 Newbrook Drive
|
|
Maryland
|
|
—
|
|
|
4,800
|
|
|
27,639
|
|
|
11,562
|
|
|
4,800
|
|
|
39,201
|
|
|
44,001
|
|
|
(17,364
|
)
|
|
26,637
|
|
|
2006
|
|
1997
|
|||||||||
Alexandria Technology Center® – Alston
|
|
Research Triangle
|
|
—
|
|
|
1,430
|
|
|
17,482
|
|
|
31,096
|
|
|
1,430
|
|
|
48,578
|
|
|
50,008
|
|
|
(23,693
|
)
|
|
26,315
|
|
|
1985 - 2009
|
|
1998
|
|||||||||
Alexandria Center® for AgTech, Phase I – Research Triangle
|
|
Research Triangle
|
|
—
|
|
|
2,000
|
|
|
6,756
|
|
|
69,863
|
|
|
2,000
|
|
|
76,619
|
|
|
78,619
|
|
|
(1,562
|
)
|
|
77,057
|
|
|
2018
|
|
2017
|
|||||||||
Alexandria Center® for AgTech, Phase II – Research Triangle
|
|
Research Triangle
|
|
—
|
|
|
800
|
|
|
—
|
|
|
9,663
|
|
|
800
|
|
|
9,663
|
|
|
10,463
|
|
|
—
|
|
|
10,463
|
|
|
N/A
|
|
2018
|
|||||||||
108/110/112/114 TW Alexander Drive
|
|
Research Triangle
|
|
—
|
|
|
—
|
|
|
376
|
|
|
43,195
|
|
|
—
|
|
|
43,571
|
|
|
43,571
|
|
|
(19,650
|
)
|
|
23,921
|
|
|
2000
|
|
1999
|
|||||||||
Alexandria Innovation Center® – Research Triangle
|
|
Research Triangle
|
|
—
|
|
|
1,065
|
|
|
21,218
|
|
|
30,249
|
|
|
1,065
|
|
|
51,467
|
|
|
52,532
|
|
|
(18,709
|
)
|
|
33,823
|
|
|
2005 - 2008
|
|
2000
|
|||||||||
6 Davis Drive
|
|
Research Triangle
|
|
—
|
|
|
9,029
|
|
|
10,712
|
|
|
20,318
|
|
|
9,029
|
|
|
31,030
|
|
|
40,059
|
|
|
(12,914
|
)
|
|
27,145
|
|
|
2012
|
|
2012
|
|||||||||
7 Triangle Drive
|
|
Research Triangle
|
|
—
|
|
|
701
|
|
|
—
|
|
|
32,502
|
|
|
701
|
|
|
32,502
|
|
|
33,203
|
|
|
(7,289
|
)
|
|
25,914
|
|
|
2011
|
|
2005
|
|||||||||
2525 East NC Highway 54
|
|
Research Triangle
|
|
—
|
|
|
713
|
|
|
12,827
|
|
|
20,751
|
|
|
713
|
|
|
33,578
|
|
|
34,291
|
|
|
(9,480
|
)
|
|
24,811
|
|
|
1995
|
|
2004
|
|||||||||
407 Davis Drive
|
|
Research Triangle
|
|
—
|
|
|
1,229
|
|
|
17,733
|
|
|
712
|
|
|
1,229
|
|
|
18,445
|
|
|
19,674
|
|
|
(3,449
|
)
|
|
16,225
|
|
|
1998
|
|
2013
|
|||||||||
601 Keystone Park Drive
|
|
Research Triangle
|
|
—
|
|
|
785
|
|
|
11,546
|
|
|
7,103
|
|
|
785
|
|
|
18,649
|
|
|
19,434
|
|
|
(6,034
|
)
|
|
13,400
|
|
|
2009
|
|
2006
|
|||||||||
6040 George Watts Hill Drive
|
|
Research Triangle
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,344
|
|
|
—
|
|
|
26,344
|
|
|
26,344
|
|
|
(3,127
|
)
|
|
23,217
|
|
|
2015
|
|
2014
|
|||||||||
5 Triangle Drive
|
|
Research Triangle
|
|
—
|
|
|
161
|
|
|
3,409
|
|
|
7,933
|
|
|
161
|
|
|
11,342
|
|
|
11,503
|
|
|
(5,248
|
)
|
|
6,255
|
|
|
1981
|
|
1998
|
|||||||||
6101 Quadrangle Drive
|
|
Research Triangle
|
|
—
|
|
|
951
|
|
|
3,982
|
|
|
11,146
|
|
|
951
|
|
|
15,128
|
|
|
16,079
|
|
|
(3,281
|
)
|
|
12,798
|
|
|
2012
|
|
2008
|
|||||||||
Canada
|
|
Canada
|
|
—
|
|
|
10,350
|
|
|
43,884
|
|
|
15,208
|
|
|
10,350
|
|
|
59,092
|
|
|
69,442
|
|
|
(22,245
|
)
|
|
47,197
|
|
|
2004 - 2012
|
|
2005 - 2007
|
|||||||||
Various
|
|
Various
|
|
—
|
|
|
64,176
|
|
|
115,107
|
|
|
217,354
|
|
|
64,176
|
|
|
332,461
|
|
|
396,637
|
|
|
(58,994
|
)
|
|
337,643
|
|
|
Various
|
|
Various
|
|||||||||
Total – North America
|
|
|
|
349,352
|
|
|
3,173,913
|
|
|
5,681,985
|
|
|
8,662,711
|
|
|
3,173,913
|
|
|
14,344,696
|
|
|
17,518,609
|
|
|
(2,704,657
|
)
|
|
14,813,952
|
|
|
|
|
|
|||||||||
Asia
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34,347
|
|
|
—
|
|
|
34,347
|
|
|
34,347
|
|
|
(4,261
|
)
|
|
30,086
|
|
|
2015
|
|
2008
|
|||||||||
|
|
|
|
$
|
349,352
|
|
|
$
|
3,173,913
|
|
|
$
|
5,681,985
|
|
|
$
|
8,697,058
|
|
|
$
|
3,173,913
|
|
|
$
|
14,379,043
|
|
|
$
|
17,552,956
|
|
|
$
|
(2,708,918
|
)
|
|
$
|
14,844,038
|
|
|
|
|
|
(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 ranges up to 40 years for buildings and improvements, up to 20 years for land improvements, and the term of the respective lease for tenant improvements.
|
(3)
|
Represents the later of the date of original construction or the date of the latest renovation.
|
|
|
December 31,
|
||||||||||
Real Estate
|
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at beginning of period
|
|
$
|
14,181,780
|
|
|
$
|
12,178,255
|
|
|
$
|
10,632,518
|
|
Acquisitions (including real estate, land, and joint venture consolidation)
|
|
2,240,376
|
|
|
1,057,036
|
|
|
707,522
|
|
|||
Additions to real estate
|
|
1,143,035
|
|
|
959,410
|
|
|
881,463
|
|
|||
Deductions (including dispositions and direct financing leases)
|
|
(12,235
|
)
|
|
(12,921
|
)
|
|
(43,248
|
)
|
|||
Balance at end of period
|
|
$
|
17,552,956
|
|
|
$
|
14,181,780
|
|
|
$
|
12,178,255
|
|
|
|
|
|
|
|
|
||||||
|
|
December 31,
|
||||||||||
Accumulated Depreciation
|
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at beginning of period
|
|
$
|
2,268,087
|
|
|
$
|
1,880,236
|
|
|
$
|
1,554,546
|
|
Depreciation expense on properties
|
|
448,661
|
|
|
390,471
|
|
|
348,064
|
|
|||
Sale of properties
|
|
(7,830
|
)
|
|
(2,620
|
)
|
|
(22,374
|
)
|
|||
Balance at end of period
|
|
$
|
2,708,918
|
|
|
$
|
2,268,087
|
|
|
$
|
1,880,236
|
|
•
|
200,000,000 shares of common stock, $.01 par value per share (“common stock”);
|
•
|
100,000,000 shares of preferred stock, $.01 par value per share (“preferred stock”); and
|
•
|
200,000,000 shares of excess stock, $.01 par value per share, or excess stock (as described below).
|
•
|
120,800,315 shares of our common stock; and
|
•
|
No shares of our preferred stock.
|
•
|
beneficially or constructively owning shares of our stock that would result in us being “closely held” under Section 856(h) of the Code; and
|
•
|
transferring shares of our stock if such transfer would result in shares of our stock being owned by fewer than 100 persons.
|
•
|
benefit economically from ownership of any shares of excess stock held in the trust;
|
•
|
have any rights to distributions thereon; or
|
•
|
possess any rights to vote or other rights attributable to the shares of excess stock held in the trust.
|
•
|
rescind as void any vote cast by a prohibited owner prior to the discovery by us that such shares have been transferred to the trustee, and
|
•
|
recast such vote in accordance with the desires of the trustee acting for the benefit of the charitable beneficiary.
|
•
|
the price paid by the prohibited owner for the shares;
|
•
|
if the prohibited owner did not give value for the shares in connection with the event causing the shares to be held in the trust (e.g., a gift, devise or other such transaction), the “market price” (as defined in our charter) of such shares on the day of the event causing the shares to be held in the trust; or
|
•
|
if the exchange for excess stock did not arise as a result of a purported transfer, the market price of such shares on the day of the other event causing the shares to be held in the trust.
|
•
|
any person who beneficially owns 10% or more of the voting power of the corporation’s outstanding voting stock; or
|
•
|
an affiliate of the corporation who, at any time within the two-year period prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then-outstanding voting stock of the corporation.
|
•
|
80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation; and
|
•
|
two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other than shares held by the interested stockholder with whom, or with whose affiliate, the business combination is to be effected, or held by an affiliate or associate of the interested stockholder.
|
•
|
one-tenth or more but less than one-third;
|
•
|
one-third or more but less than a majority; or
|
•
|
a majority or more of all voting power.
|
•
|
with respect to an annual meeting of stockholders, nominations of individuals for election to our Board and the proposal of business to be considered by stockholders may be made only:
|
•
|
pursuant to our notice of the meeting;
|
•
|
by or at the direction of our Board; or
|
•
|
by a stockholder who is entitled to vote at the meeting and has complied with the advance notice procedures set forth in the bylaws; and
|
•
|
with respect to special meetings of stockholders, only the business specified in our notice of meeting may be brought before the special meeting of stockholders. Nominations of persons for election to our Board may be made at a special meeting of stockholders at which directors are to be elected only:
|
◦
|
by or at the direction of our Board; or
|
◦
|
provided that our Board has determined that directors shall be elected at such meeting, by a stockholder who is entitled to vote at the meeting and has complied with the advance notice provisions set forth in the bylaws.
|
•
|
a classified board;
|
•
|
a two-thirds vote requirement for removing a director;
|
•
|
a requirement that the number of directors be fixed only by vote of the directors;
|
•
|
a requirement that a vacancy on the board be filled only by the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred; and
|
•
|
a majority vote requirement for the calling by stockholders of a special meeting of stockholders.
|
•
|
vest in the board the exclusive power to fix the number of directorships and
|
•
|
require, unless called by our chairman of the board, our president, our chief executive officer or the board, the request of holders of a majority of outstanding shares to call a special meeting.
|
•
|
a two-thirds vote requirement for the removal of any director from the board and
|
•
|
the filling of vacancies on the board.
|
Lead Independent Director
|
$
|
50,000
|
|
Audit Committee Chairperson
|
$
|
35,000
|
|
Compensation Committee Chairperson
|
$
|
35,000
|
|
Nominating & Governance Committee Chairperson
|
$
|
35,000
|
|
Science and Technology Committee Chairperson
|
$
|
20,000
|
|
Audit Committee Member
|
$
|
20,000
|
|
Compensation Committee Member
|
$
|
20,000
|
|
Nominating & Governance Committee Member
|
$
|
20,000
|
|
Science and Technology Committee Member
|
$
|
6,000
|
|
Pricing Committee Member
|
$
|
6,000
|
|
•
|
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 which 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 at the expense of ARE or its tenants, partners or other entities with which ARE does business?
|
•
|
Could the activity appear improper to an outside observer?
|
•
|
Will not tolerate the use of child (under the age of 15), forced or compulsory labor in any of its global operations and facilities.
|
•
|
Will not tolerate the engagement of any worker in unacceptably hazardous work, nor the physical punishment, abuse, or involuntary servitude of any worker.
|
•
|
Expects our suppliers and contractors with whom we do business to uphold the same standards. Should a pattern of violation of these principles become known to Alexandria and not corrected, we shall discontinue the business relationship.
|
Name of Subsidiary
|
|
Jurisdiction of Organization
|
ARE - QRS Corp.
|
|
Maryland
|
Alexandria Real Estate Equities, L.P.
|
|
Delaware
|
Alexandria Venture Investments, 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, Form S-8 No. 333-197212, Form S-8 No. 333-212385, and Form S-8 No. 333-226129);
|
•
|
Registration Statement (Form S-3/A No. 333-56449) and related Prospectus of Alexandria Real Estate Equities, Inc.;
|
•
|
Registration Statement (Form S-3/A No. 333-81985) and related Prospectus of Alexandria Real Estate Equities, Inc.; and
|
•
|
Registration Statement (Form S-3ASR No. 333-222136) and related Prospectus of Alexandria Real Estate Equities, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Joel S. Marcus
|
|
Joel S. Marcus
|
|
Executive Chairman
|
1.
|
I have reviewed this Annual Report on Form 10-K of Alexandria Real Estate Equities, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Stephen A. Richardson
|
|
Stephen A. Richardson
|
|
Co-Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of Alexandria Real Estate Equities, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Peter M. Moglia
|
|
Peter M. Moglia
|
|
Co-Chief Executive Officer and Co-Chief Investment Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of Alexandria Real Estate Equities, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Dean A. Shigenaga
|
|
Dean A. Shigenaga
|
|
Co-President and Chief Financial Officer
|
|
/s/ Joel S. Marcus
|
|
Joel S. Marcus
|
|
Executive Chairman
|
|
/s/ Stephen A. Richardson
|
|
Stephen A. Richardson
|
|
Co-Chief Executive Officer
|
|
/s/ Peter M. Moglia
|
|
Peter M. Moglia
|
|
Co-Chief Executive Officer and Co-Chief Investment Officer
|
|
/s/ Dean A. Shigenaga
|
|
Dean A. Shigenaga
|
|
Co-President and Chief Financial Officer
|