|
x
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Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the fiscal year ended December 31, 2013
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o
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Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from to
to
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Maryland
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58-2328421
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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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11695 Johns Creek Parkway Ste. 350, Johns Creek, Georgia
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30097
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of exchange on which registered
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COMMON STOCK
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NEW YORK STOCK EXCHANGE
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FORM 10-K
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PIEDMONT OFFICE REALTY TRUST, INC.
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TABLE OF CONTENTS
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PART I.
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Page No.
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV.
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Item 15.
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•
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Market and economic conditions remain challenging in some markets we operate in and the demand for office space, rental rates and property values may continue to lag the general economic recovery causing our business, results of operations, cash flows, financial condition and access to capital to be adversely affected or otherwise impact performance, including the potential recognition of impairment charges;
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•
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The success of our real estate strategies and investment objectives, including our ability to identify and consummate suitable acquisitions;
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•
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Acquisitions of properties may have unknown risks and other liabilities at the time of acquisition;
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•
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Lease terminations or lease defaults, particularly by one of our large lead tenants;
|
•
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The impact of competition on our efforts to renew existing leases or re-let space on terms similar to existing leases;
|
•
|
Changes in the economies and other conditions of the office market in general and of the specific markets in which we operate;
|
•
|
Economic and regulatory changes, including accounting standards, that impact the real estate market generally;
|
•
|
Additional risks and costs associated with directly managing properties occupied by government tenants;
|
•
|
Adverse market and economic conditions may continue to adversely affect us and could cause us to recognize impairment charges or otherwise impact our performance;
|
•
|
Availability of financing and our lending banks’ ability to honor existing line of credit commitments;
|
•
|
Costs of complying with governmental laws and regulations;
|
•
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Uncertainties associated with environmental and other regulatory matters;
|
•
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Potential changes in political environment and reduction in federal and/or state funding of our governmental tenants;
|
•
|
We may be subject to litigation, which could have a material adverse effect on our financial condition;
|
•
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Changes in tax laws impacting REITs and real estate in general, as well as Piedmont’s ability to continue to qualify as a REIT under the Internal Revenue Code (the “Code”); and
|
•
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Other factors, including the risk factors discussed under Item 1A. of this Annual Report on Form 10-K.
|
•
|
changes in the national, regional, and local economic climate, particularly in markets in which we have a concentration of properties;
|
•
|
local office market conditions such as changes in the supply of, or demand for, space in properties similar to those that we own within a particular area;
|
•
|
changes in the patterns of office use due to technological advances which may make telecommuting more prevalent;
|
•
|
the attractiveness of our properties to potential tenants;
|
•
|
changes in interest rates and availability of permanent mortgage funds that may render the sale of a property difficult or unattractive or otherwise reduce returns to stockholders;
|
•
|
the financial stability of our tenants, including bankruptcies, financial difficulties, or lease defaults by our tenants;
|
•
|
changes in operating costs and expenses, including costs for maintenance, insurance, and real estate taxes, and our ability to control rents in light of such changes;
|
•
|
the need to periodically fund the costs to repair, renovate, and re-let space;
|
•
|
earthquakes, tornadoes, hurricanes and other natural disasters, civil unrest, terrorist acts or acts of war, which may result in uninsured or under insured losses;
|
•
|
changes in, or increased costs of compliance with, governmental regulations, including those governing usage, zoning, the environment, and taxes; and
|
•
|
changes in accounting standards.
|
•
|
we may acquire properties or other real estate-related investments that are not initially accretive to our results upon acquisition or accept lower cash flows in anticipation of longer term appreciation, and we may not successfully manage and lease those properties to meet our expectations;
|
•
|
we may not achieve expected cost savings and operating efficiencies;
|
•
|
we may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of properties, into our existing operations;
|
•
|
management attention may be diverted to the integration of acquired properties, which in some cases may turn out to be less compatible with our operating strategy than originally anticipated;
|
•
|
we may not be able to support the acquired property through one of our existing property management offices and may not successfully open new satellite offices to serve additional markets;
|
•
|
the acquired properties may not perform as well as we anticipate due to various factors, including changes in macro-economic conditions and the demand for office space; and
|
•
|
we may acquire properties without any recourse, or with only limited recourse, for liabilities, whether known or unknown, such as clean-up of environmental contamination, unknown/undisclosed latent structural issues or maintenance problems, claims by tenants, vendors or other persons against 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.
|
•
|
in these investments, we do not have exclusive control over the development, financing, leasing, management, and other aspects of the project, which may prevent us from taking actions that are opposed by our joint venture partners;
|
•
|
joint venture agreements often restrict the transfer of a co-venturer’s interest or may otherwise restrict our ability to sell the interest when we desire or on advantageous terms;
|
•
|
we would not be in a position to exercise sole decision-making authority regarding the property or joint venture, which could create the potential risk of creating impasses on decisions, such as acquisitions or sales;
|
•
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such co-venturer may, at any time, have economic or business interests or goals that are, or that may become, inconsistent with our business interests or goals;
|
•
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such co-venturer may be in a position to take action contrary to our instructions, requests, policies or objectives, including our current policy with respect to maintaining our qualification as a REIT;
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•
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the possibility that our co-venturer in an investment might become bankrupt, which would mean that we and any other remaining co-venturers would generally remain liable for the joint venture’s liabilities;
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•
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our relationships with our co-venturers are contractual in nature and may be terminated or dissolved under the terms of the applicable joint venture agreements and, in such event, we may not continue to own or operate the interests or assets underlying such relationship or may need to purchase such interests or assets at a premium to the market price to continue ownership;
|
•
|
disputes between us and our co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and directors from focusing their time and efforts on our business and could result in subjecting the properties owned by the applicable joint venture to additional risk; or
|
•
|
we may, in certain circumstances, be liable for the actions of our co-venturers, and the activities of a joint venture could adversely affect our ability to qualify as a REIT, even though we do not control the joint venture.
|
•
|
development projects in which we have invested may be abandoned and the related investment will be impaired;
|
•
|
we may not be able to obtain, or may experience delays in obtaining, all necessary zoning, land-use, building, occupancy and other governmental permits and authorizations;
|
•
|
we may not be able to obtain land on which to develop;
|
•
|
we may not be able to obtain financing for development projects, or obtain financing on favorable terms;
|
•
|
construction costs of a project may exceed the original estimates or construction may not be concluded on schedule, making the project less profitable than originally estimated or not profitable at all (including the possibility of contract default, the effects of local weather conditions, the possibility of local or national strikes and the possibility of shortages in materials, building supplies or energy and fuel for equipment);
|
•
|
upon completion of construction, we may not be able to obtain, or obtain on advantageous terms, permanent financing for activities that we financed through construction loans; and
|
•
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we may not achieve sufficient occupancy levels and/or obtain sufficient rents to ensure the profitability of a completed project.
|
•
|
within the limits provided in our charter, prevent the ownership, transfer, and/or accumulation of stock in order to protect our status as a REIT or for any other reason deemed to be in our best interest and the interest of our stockholders;
|
•
|
issue additional shares of stock without obtaining stockholder approval, which could dilute the ownership of our then-current stockholders;
|
•
|
amend our charter to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that we have authority to issue, without obtaining stockholder approval;
|
•
|
classify or reclassify any unissued shares of our common or preferred stock and set the preferences, rights and other terms of such classified or reclassified shares, without obtaining stockholder approval;
|
•
|
employ and compensate affiliates;
|
•
|
direct our resources toward investments that do not ultimately appreciate over time;
|
•
|
change creditworthiness standards with respect to our tenants;
|
•
|
change our investment or borrowing policies;
|
•
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determine that it is no longer in our best interest to attempt to qualify, or to continue to qualify, as a REIT; and
|
•
|
suspend, modify or terminate the dividend reinvestment plan.
|
•
|
“business combination” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our outstanding voting stock or any affiliate or associate of ours 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 our then outstanding stock) or an
|
•
|
“control share” provisions that provide that “control shares” of our company (defined as shares which, when aggregated with other shares controlled by the stockholder, except solely by virtue of a revocable proxy, entitle the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of “control shares”) have no voting rights except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares.
|
•
|
cash available for distribution;
|
•
|
our results of operations and anticipated future results of operations;
|
•
|
our financial condition, especially in relation to our anticipated future capital needs of our properties;
|
•
|
the level of reserves we establish for future capital expenditures;
|
•
|
the distribution requirements for REITs under the Code;
|
•
|
the level of distributions paid by comparable listed REITs;
|
•
|
our operating expenses; and
|
•
|
other factors our board of directors deems relevant.
|
•
|
actual or anticipated variations in our quarterly operating results;
|
•
|
changes in our earnings estimates or publication of research reports about us or the real estate industry, although no assurance can be given that any research reports about us will be published or the accuracy of such reports;
|
•
|
changes in our dividend policy;
|
•
|
future sales of substantial amounts of our common stock by our existing or future stockholders;
|
•
|
increases in market interest rates, which may lead purchasers of our stock to demand a higher yield;
|
•
|
changes in market valuations of similar companies;
|
•
|
adverse market reaction to any increased indebtedness we incur in the future;
|
•
|
additions or departures of key personnel;
|
•
|
actions by institutional stockholders;
|
•
|
material, adverse litigation judgments;
|
•
|
speculation in the press or investment community; and
|
•
|
general market and economic conditions.
|
Year of Lease Expiration
|
|
Annualized
Lease Revenue
(in thousands)
|
|
Rentable Square
Feet Expiring
(in thousands)
|
|
Percentage of
Annualized
Lease Revenue (%)
|
||||
Vacant
|
|
$
|
—
|
|
|
2,753
|
|
|
—
|
|
2014
(1)
|
|
51,851
|
|
|
1,339
|
|
|
9.1
|
|
|
2015
|
|
25,953
|
|
|
848
|
|
|
4.6
|
|
|
2016
|
|
31,631
|
|
|
1,133
|
|
|
5.5
|
|
|
2017
|
|
54,665
|
|
|
1,391
|
|
|
9.6
|
|
|
2018
|
|
56,411
|
|
|
1,955
|
|
|
9.9
|
|
|
2019
|
|
61,419
|
|
|
2,280
|
|
|
10.8
|
|
|
2020
|
|
38,278
|
|
|
1,416
|
|
|
6.7
|
|
|
2021
|
|
31,671
|
|
|
1,052
|
|
|
5.6
|
|
|
2022
|
|
25,486
|
|
|
858
|
|
|
4.5
|
|
|
2023
|
|
29,459
|
|
|
1,128
|
|
|
5.2
|
|
|
2024
|
|
43,488
|
|
|
1,455
|
|
|
7.6
|
|
|
2025
|
|
16,735
|
|
|
692
|
|
|
2.9
|
|
|
2026
|
|
12,098
|
|
|
496
|
|
|
2.1
|
|
|
2027
|
|
51,945
|
|
|
1,231
|
|
|
9.1
|
|
|
Thereafter
|
|
38,712
|
|
|
1,463
|
|
|
6.8
|
|
|
|
|
$
|
569,802
|
|
|
21,490
|
|
|
100.0
|
|
(1)
|
Includes leases with an expiration date of
December 31, 2013
aggregating
336,139
square feet and Annualized Lease Revenue of
$15.1
million.
|
Location
|
|
Annualized
Lease Revenue
(in thousands)
|
|
Rentable Square
Feet
(in thousands)
|
|
Percentage of
Annualized
Lease Revenue (%)
|
||||
Chicago
|
|
$
|
121,043
|
|
|
4,816
|
|
|
21.2
|
|
Washington, D.C.
|
|
115,249
|
|
|
3,381
|
|
|
20.2
|
|
|
New York
|
|
83,837
|
|
|
2,432
|
|
|
14.7
|
|
|
Minneapolis
|
|
44,974
|
|
|
1,613
|
|
|
7.9
|
|
|
Dallas
|
|
41,637
|
|
|
1,907
|
|
|
7.3
|
|
|
Boston
|
|
34,093
|
|
|
1,293
|
|
|
6.0
|
|
|
Los Angeles
|
|
29,159
|
|
|
1,010
|
|
|
5.1
|
|
|
Detroit
|
|
18,479
|
|
|
1,008
|
|
|
3.2
|
|
|
Atlanta
|
|
17,597
|
|
|
1,064
|
|
|
3.1
|
|
|
Philadelphia
|
|
17,526
|
|
|
801
|
|
|
3.1
|
|
|
Nashville
|
|
10,040
|
|
|
513
|
|
|
1.8
|
|
|
Houston
|
|
10,034
|
|
|
313
|
|
|
1.8
|
|
|
Central & South Florida
|
|
8,848
|
|
|
476
|
|
|
1.6
|
|
|
Phoenix
|
|
7,064
|
|
|
432
|
|
|
1.2
|
|
|
Austin
|
|
6,411
|
|
|
195
|
|
|
1.1
|
|
|
Other
|
(1)
|
3,811
|
|
|
236
|
|
|
0.7
|
|
|
|
|
$
|
569,802
|
|
|
21,490
|
|
|
100.0
|
|
(1)
|
Not more than
1%
is attributable to any individual geographic region.
|
Industry
|
|
Annualized
Lease Revenue
(in thousands)
|
|
Leased Square
Footage
(in thousands)
|
|
Percentage of
Annualized
Lease Revenue (%)
|
||||
Governmental Entity
|
|
$
|
85,102
|
|
|
2,037
|
|
|
14.9
|
|
Business Services
|
|
57,920
|
|
|
2,077
|
|
|
10.2
|
|
|
Depository Institutions
|
|
54,019
|
|
|
1,856
|
|
|
9.5
|
|
|
Engineering, Accounting, Research, Management & Related Services
|
|
42,302
|
|
|
1,207
|
|
|
7.4
|
|
|
Nondepository Credit Institutions
|
|
35,790
|
|
|
1,244
|
|
|
6.3
|
|
|
Insurance Carriers
|
|
33,567
|
|
|
1,373
|
|
|
5.9
|
|
|
Insurance Agents, Brokers & Services
|
|
30,851
|
|
|
1,202
|
|
|
5.4
|
|
|
Security & Commodity Brokers, Dealers, Exchanges & Services
|
|
18,251
|
|
|
661
|
|
|
3.2
|
|
|
Communications
|
|
17,799
|
|
|
585
|
|
|
3.1
|
|
|
Electronic & Other Electrical Equipment & Components, Except Computer
|
|
16,432
|
|
|
623
|
|
|
2.9
|
|
|
Educational Services
|
|
15,561
|
|
|
406
|
|
|
2.7
|
|
|
Transportation Equipment
|
|
14,689
|
|
|
595
|
|
|
2.6
|
|
|
Automotive Repair, Services & Parking
|
|
13,883
|
|
|
49
|
|
|
2.4
|
|
|
Fabricated Metal Products, Except Machinery & Transportation Equipment
|
|
12,677
|
|
|
423
|
|
|
2.2
|
|
|
Real Estate
|
|
12,233
|
|
|
398
|
|
|
2.2
|
|
|
Other
|
(1)
|
108,726
|
|
|
4,001
|
|
|
19.1
|
|
|
|
|
$
|
569,802
|
|
|
18,737
|
|
|
100.0
|
|
(1)
|
Not more than
2%
is attributable to any individual industry.
|
Tenant
|
|
Number of
Properties
|
|
Expiration Date(s)
(1)
|
|
Annualized
Lease Revenues
(in thousands)
(2)
|
|
Percentage of
Annualized
Lease Revenues (%)
|
||||
U.S. Government
|
|
8
|
|
|
Various
|
(3)
|
$
|
54,401
|
|
|
9.5
|
|
US Bancorp
|
|
3
|
|
|
2024 / 2014 / 2023
|
(4)
|
28,536
|
|
|
5.0
|
|
|
State of New York
|
|
1
|
|
|
2019
|
|
20,574
|
|
|
3.6
|
|
|
Independence Blue Cross
|
|
1
|
|
|
2033
|
|
17,526
|
|
|
3.1
|
|
|
GE
|
|
2
|
|
|
2027
|
|
15,238
|
|
|
2.7
|
|
|
Aon
|
|
1
|
|
|
2028
|
|
13,384
|
|
|
2.4
|
|
|
Nestle
|
|
1
|
|
|
2021
|
|
11,939
|
|
|
2.1
|
|
|
Shaw
|
|
1
|
|
|
2018
|
|
10,014
|
|
|
1.8
|
|
|
City of New York
|
|
1
|
|
|
2020
|
|
9,776
|
|
|
1.7
|
|
|
Nokia
|
|
3
|
|
|
2013 / 2020 / 2021
|
(5)
|
9,008
|
|
|
1.6
|
|
|
Lockheed Martin
|
|
3
|
|
|
2014 / 2019 / 2020
|
(6)
|
9,008
|
|
|
1.6
|
|
|
KPMG
|
|
2
|
|
|
2027
|
|
8,958
|
|
|
1.6
|
|
|
Gallagher
|
|
1
|
|
|
2018
|
|
8,167
|
|
|
1.4
|
|
|
DDB Needham
|
|
1
|
|
|
2018
|
|
7,629
|
|
|
1.3
|
|
|
Caterpillar Financial
|
|
1
|
|
|
2022
|
|
7,461
|
|
|
1.3
|
|
|
Gemini
|
|
1
|
|
|
2021
|
|
7,349
|
|
|
1.3
|
|
|
Harvard University
|
|
2
|
|
|
2017
|
|
6,730
|
|
|
1.2
|
|
|
KeyBank
|
|
2
|
|
|
2016
|
|
6,421
|
|
|
1.1
|
|
|
Harcourt
|
|
1
|
|
|
2016
|
|
6,406
|
|
|
1.1
|
|
|
Edelman
|
|
1
|
|
|
2024
|
|
6,359
|
|
|
1.1
|
|
|
Raytheon
|
|
2
|
|
|
2019
|
|
6,290
|
|
|
1.1
|
|
|
Catamaran
|
|
1
|
|
|
2025
|
|
5,975
|
|
|
1.1
|
|
|
Jones Lang LaSalle
|
|
1
|
|
|
2017
|
|
5,936
|
|
|
1.0
|
|
|
First Data Corporation
|
|
1
|
|
|
2020
|
|
5,894
|
|
|
1.0
|
|
|
Other
|
|
|
|
Various
|
(7)
|
280,823
|
|
|
49.3
|
|
||
|
|
|
|
|
|
$
|
569,802
|
|
|
100.0
|
|
(1)
|
Represents the expiration year of the majority of the square footage leased by the tenant.
|
(2)
|
Approximately
73%
of our ALR is derived from investment grade or nationally recognized companies or government agencies.
|
(3)
|
Various expirations ranging from 2013 to 2027.
|
(4)
|
US Bank's lease at One & Two Meridian Crossings in Richfield, Minnesota, representing approximately 337,000 square feet and $9.3 million of Annualized Lease Revenue, expires in 2023. Of the space leased at US Bancorp Center in Minneapolis, Minnesota, US Bancorp renewed on 395,000 square feet, representing $11.1 million of ALR, through 2024 and Piper Jaffray, a current subtenant, leased 124,000 square feet, representing $3.7 million of ALR, through 2025. Approximately 120,000 square feet and $4.4 million of Annualized Lease Revenue will expire in 2014.
|
(5)
|
There are three leases with Nokia. Nokia's lease at: 1) 6021 Connection Drive in Irving, Texas, representing $4.5 million of ALR and 196,000 square feet, expired on December 31, 2013; 2) 5 & 15 Wayside Road, in Burlington, Massachusetts representing $3.8 million and 129,000 square feet, expires in 2020, and 3) Las Colinas Corporate Center II in Irving, Texas, representing $0.6 million and 27,000 square feet, expires in 2021.
|
(6)
|
There are three leases with Lockheed Martin. Lockheed Martin's lease at: 1) 9221 Corporate Boulevard in Rockville, Maryland, representing $3.4 million of ALR and 115,000 square feet, expires in 2019, 2) 9211 Corporate Boulevard in Rockville, Maryland, representing $3.3 million of ALR and 115,000 square feet, expires in 2014, and 3) 400 Virginia Avenue in Washington, D.C., representing $2.3 million of ALR and 52,000 square feet, expires in 2020.
|
(7)
|
Not more than
1%
is attributable to any individual tenant.
|
|
2013 Quarters
|
||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
High
|
$
|
20.00
|
|
|
$
|
21.09
|
|
|
$
|
19.06
|
|
|
$
|
18.93
|
|
Low
|
$
|
17.94
|
|
|
$
|
16.49
|
|
|
$
|
16.83
|
|
|
$
|
15.86
|
|
|
|
|
|
|
|
|
|
||||||||
|
2012 Quarters
|
||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
High
|
$
|
18.91
|
|
|
$
|
17.97
|
|
|
$
|
17.98
|
|
|
$
|
18.56
|
|
Low
|
$
|
16.97
|
|
|
$
|
16.10
|
|
|
$
|
16.57
|
|
|
$
|
17.08
|
|
|
2013
|
|||||||||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
Total
|
|
% of Total
Distribution
|
|||||||||||
Total cash distributed
|
$
|
33,511
|
|
|
$
|
33,540
|
|
|
$
|
32,880
|
|
|
$
|
32,158
|
|
|
$
|
132,089
|
|
|
|
|
Per-share investment income
|
$
|
0.1280
|
|
|
$
|
0.1280
|
|
|
$
|
0.1280
|
|
|
$
|
0.1280
|
|
|
$
|
0.5120
|
|
|
64
|
%
|
Per-share return of capital
|
$
|
0.0720
|
|
|
$
|
0.0720
|
|
|
$
|
0.0720
|
|
|
$
|
0.0720
|
|
|
$
|
0.2880
|
|
|
36
|
%
|
Per-share capital gains
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
%
|
Total per-share distribution
|
$
|
0.2000
|
|
|
$
|
0.2000
|
|
|
$
|
0.2000
|
|
|
$
|
0.2000
|
|
|
$
|
0.8000
|
|
|
100
|
%
|
|
2012
|
|||||||||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
Total
|
|
% of Total
Distribution
|
|||||||||||
Total cash distributed
|
$
|
34,526
|
|
|
$
|
34,418
|
|
|
$
|
33,675
|
|
|
$
|
33,549
|
|
|
$
|
136,168
|
|
|
|
|
Per-share investment income
|
$
|
0.1460
|
|
|
$
|
0.1460
|
|
|
$
|
0.1460
|
|
|
$
|
0.1460
|
|
|
$
|
0.5840
|
|
|
73
|
%
|
Per-share return of capital
|
$
|
0.0220
|
|
|
$
|
0.0220
|
|
|
$
|
0.0220
|
|
|
$
|
0.0220
|
|
|
$
|
0.0880
|
|
|
11
|
%
|
Per-share capital gains
|
$
|
0.0320
|
|
|
$
|
0.0320
|
|
|
$
|
0.0320
|
|
|
$
|
0.0320
|
|
|
$
|
0.1280
|
|
|
16
|
%
|
Total per-share distribution
|
$
|
0.2000
|
|
|
$
|
0.2000
|
|
|
$
|
0.2000
|
|
|
$
|
0.2000
|
|
|
$
|
0.8000
|
|
|
100
|
%
|
|
For the Period from
February 10, 2010
to December 31, 2013
|
|
|||||||||||||
|
2/10/2010
|
12/31/2010
|
12/31/2011
|
12/31/2012
|
12/31/2013
|
||||||||||
Piedmont Office Realty Trust, Inc.
|
$
|
100.00
|
|
$
|
138.02
|
|
$
|
124.94
|
|
$
|
138.67
|
|
$
|
132.60
|
|
FTSE NAREIT Equity Office
|
$
|
100.00
|
|
$
|
124.61
|
|
$
|
123.66
|
|
$
|
141.17
|
|
$
|
149.04
|
|
FTSE NAREIT Equity REITs
|
$
|
100.00
|
|
$
|
134.99
|
|
$
|
146.19
|
|
$
|
172.59
|
|
$
|
176.85
|
|
S&P 500
|
$
|
100.00
|
|
$
|
119.36
|
|
$
|
121.88
|
|
$
|
141.38
|
|
$
|
187.17
|
|
Period
|
Total Number of
Shares Purchased
(in 000’s)
|
|
Average Price Paid
per Share
|
|
Total Number of
Shares Purchased
as Part of
Publicly Announced
Program
(in 000’s)
(1)
|
|
Maximum Approximate
Dollar Value of Shares
Available That May
Yet Be Purchased
Under the Program
(in 000’s)
(1)
|
|
||||||
October 1, 2013 to October 31, 2013
|
158
|
|
|
$
|
17.45
|
|
|
158
|
|
|
—
|
|
|
|
November 1, 2013 to November 30, 2013
|
555
|
|
|
$
|
16.76
|
|
|
555
|
|
|
—
|
|
|
|
December 1, 2013 to December 31, 2013
|
3,201
|
|
|
$
|
16.39
|
|
|
3,100
|
|
|
$
|
89,837
|
|
(1)
|
Total
|
3,914
|
|
|
$
|
16.49
|
|
|
3,813
|
|
|
$
|
89,837
|
|
(1)
|
(1)
|
Under our amended and restated DRP, as set forth in a Current Report on Form 8-K filed February 24, 2011, we have the option to either issue shares that we purchase in the open market or issue shares directly from Piedmont from authorized but unissued shares. Such election will take place at the settlement of each quarterly dividend in which there are participants in our DRP, and may change from quarter to quarter based on our judgment of the best use of proceeds for Piedmont. Therefore, the "Maximum Approximate Dollar Value of Shares Available That May Yet Be Purchased Under the Program" relates only to the stock repurchase plan. The stock repurchase plan was previously announced in our Quarterly Report on Form 10-Q filed November 3, 2011. On October 30, 2013, our board of directors amended and restated the plan to authorize $150 million in stock repurchases over the next two years. The stock repurchase plan is separate from shares purchased for DRP issuance.
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Statement of Income Data
(1)
:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total revenues
|
$
|
554,505
|
|
|
$
|
525,044
|
|
|
$
|
525,108
|
|
|
$
|
515,532
|
|
|
$
|
524,579
|
|
Property operating costs
|
$
|
222,979
|
|
|
$
|
208,280
|
|
|
$
|
202,531
|
|
|
$
|
191,817
|
|
|
$
|
202,295
|
|
Depreciation and amortization
|
$
|
168,213
|
|
|
$
|
159,921
|
|
|
$
|
154,694
|
|
|
$
|
130,776
|
|
|
$
|
139,148
|
|
Impairment loss on real estate assets
|
$
|
1,242
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20,789
|
|
General and administrative expenses
|
$
|
21,883
|
|
|
$
|
20,765
|
|
|
$
|
25,072
|
|
|
$
|
28,123
|
|
|
$
|
26,644
|
|
Other income/(expense)
|
$
|
(68,698
|
)
|
|
$
|
(75,937
|
)
|
|
$
|
(58,761
|
)
|
|
$
|
(60,367
|
)
|
|
$
|
(66,953
|
)
|
Income from continuing operations
(1)
|
$
|
71,490
|
|
|
$
|
60,141
|
|
|
$
|
84,050
|
|
|
$
|
104,449
|
|
|
$
|
68,750
|
|
Income from discontinued operations
(1)
|
$
|
27,253
|
|
|
$
|
33,078
|
|
|
$
|
141,006
|
|
|
$
|
15,945
|
|
|
$
|
5,965
|
|
Net income attributable to noncontrolling interest
|
$
|
(15
|
)
|
|
$
|
(15
|
)
|
|
$
|
(15
|
)
|
|
$
|
(15
|
)
|
|
$
|
(15
|
)
|
Net income attributable to Piedmont
|
$
|
98,728
|
|
|
$
|
93,204
|
|
|
$
|
225,041
|
|
|
$
|
120,379
|
|
|
$
|
74,700
|
|
Per-Share Data
(1)
:
|
|
|
|
|
|
|
|
|
|
||||||||||
Per weighted-average common share data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations per share—basic
|
$
|
0.44
|
|
|
$
|
0.35
|
|
|
$
|
0.49
|
|
|
$
|
0.62
|
|
|
$
|
0.43
|
|
Income from continuing operations per share—diluted
|
$
|
0.44
|
|
|
$
|
0.35
|
|
|
$
|
0.49
|
|
|
$
|
0.61
|
|
|
$
|
0.43
|
|
Income from discontinued operations per share—basic and diluted
|
$
|
0.16
|
|
|
$
|
0.20
|
|
|
$
|
0.81
|
|
|
$
|
0.09
|
|
|
$
|
0.04
|
|
Net income attributable to Piedmont per share—basic
|
$
|
0.60
|
|
|
$
|
0.55
|
|
|
$
|
1.30
|
|
|
$
|
0.71
|
|
|
$
|
0.47
|
|
Net income attributable to Piedmont per share—diluted
|
$
|
0.60
|
|
|
$
|
0.55
|
|
|
$
|
1.30
|
|
|
$
|
0.70
|
|
|
$
|
0.47
|
|
Dividends declared
|
$
|
0.80
|
|
|
$
|
0.80
|
|
|
$
|
1.26
|
|
|
$
|
1.26
|
|
|
$
|
1.26
|
|
Weighted-average shares outstanding—basic (in thousands)
|
165,013
|
|
|
170,312
|
|
|
172,765
|
|
|
170,753
|
|
|
158,419
|
|
|||||
Weighted-average shares outstanding—diluted (in thousands)
|
165,137
|
|
|
170,441
|
|
|
172,981
|
|
|
170,967
|
|
|
158,581
|
|
|||||
Balance Sheet Data (at period end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
4,666,088
|
|
|
$
|
4,254,875
|
|
|
$
|
4,447,834
|
|
|
$
|
4,373,480
|
|
|
$
|
4,395,345
|
|
Total stockholders’ equity
|
$
|
2,461,159
|
|
|
$
|
2,640,495
|
|
|
$
|
2,773,428
|
|
|
$
|
2,773,454
|
|
|
$
|
2,606,882
|
|
Outstanding debt
|
$
|
2,002,205
|
|
|
$
|
1,416,525
|
|
|
$
|
1,472,525
|
|
|
$
|
1,402,525
|
|
|
$
|
1,516,525
|
|
Ratio of Earnings to Fixed Charges
|
2.0
|
|
|
1.9
|
|
|
2.2
|
|
|
2.5
|
|
|
1.9
|
|
|||||
Funds from Operations Data
(2)
:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income attributable to Piedmont
|
$
|
98,728
|
|
|
$
|
93,204
|
|
|
$
|
225,041
|
|
|
$
|
120,379
|
|
|
$
|
74,700
|
|
Depreciation and Amortization
|
170,158
|
|
|
164,750
|
|
|
170,553
|
|
|
150,441
|
|
|
164,586
|
|
|||||
Loss/(gain) on consolidation
|
898
|
|
|
—
|
|
|
(1,532
|
)
|
|
—
|
|
|
—
|
|
|||||
Loss on impairment
|
12,046
|
|
|
—
|
|
|
—
|
|
|
9,640
|
|
|
37,633
|
|
|||||
(Gain)/loss on sale
|
(31,292
|
)
|
|
(27,577
|
)
|
|
(122,773
|
)
|
|
792
|
|
|
—
|
|
|||||
Funds From Operations
(2)
|
$
|
250,538
|
|
|
$
|
230,377
|
|
|
$
|
271,289
|
|
|
$
|
281,252
|
|
|
$
|
276,919
|
|
Acquisition costs
|
1,763
|
|
|
141
|
|
|
1,347
|
|
|
600
|
|
|
—
|
|
|||||
Gain on extinguishment of debt
|
—
|
|
|
—
|
|
|
(1,039
|
)
|
|
—
|
|
|
—
|
|
|||||
Litigation settlement expense/(recoveries)
|
(1,250
|
)
|
|
7,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net casualty loss/(recoveries)
|
(10,578
|
)
|
|
5,170
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Core Funds From Operations
(2)
|
$
|
240,473
|
|
|
$
|
243,188
|
|
|
$
|
271,597
|
|
|
$
|
281,852
|
|
|
$
|
276,919
|
|
Amortization of deferred financing costs, fair market adjustments on notes payable, discount on Senior Notes, and swap settlements
|
2,620
|
|
|
2,648
|
|
|
4,608
|
|
|
2,608
|
|
|
2,786
|
|
|||||
Depreciation of non real estate assets
|
406
|
|
|
502
|
|
|
499
|
|
|
707
|
|
|
632
|
|
|||||
Straight-line effects of lease revenue and amortization of below-market in-place lease intangibles
|
(23,375
|
)
|
|
(22,831
|
)
|
|
(16,572
|
)
|
|
(11,881
|
)
|
|
(6,396
|
)
|
|||||
Stock-based and other non-cash compensation
|
1,590
|
|
|
2,246
|
|
|
4,705
|
|
|
3,681
|
|
|
3,178
|
|
|||||
Acquisition costs
|
(1,763
|
)
|
|
(141
|
)
|
|
(1,347
|
)
|
|
(600
|
)
|
|
—
|
|
|||||
Income from amortization of discount on purchase of mezzanine loans
|
—
|
|
|
—
|
|
|
(484
|
)
|
|
(2,405
|
)
|
|
(2,278
|
)
|
|||||
Non-incremental capital expenditures
|
(102,977
|
)
|
|
(87,657
|
)
|
|
(60,401
|
)
|
|
(45,286
|
)
|
|
(37,546
|
)
|
|||||
Adjusted Funds From Operations
(2)
|
$
|
116,974
|
|
|
$
|
137,955
|
|
|
$
|
202,605
|
|
|
$
|
228,676
|
|
|
$
|
237,295
|
|
(1)
|
Prior period amounts have been adjusted to conform with the current period presentation, including classifying revenues from sold properties as discontinued operations for all periods presented.
|
(2)
|
Net income calculated in accordance with GAAP is the starting point for calculating Funds from Operations (“FFO”), Core Funds From Operations (“Core FFO”), and Adjusted Funds From Operations ("AFFO"). See Item 7.
—
"Management's Discussion and Analysis of Financial Condition and Results of Operations" below for a complete definition of the calculations as presented.
|
|
December 31, 2013
|
|
%
|
|
December 31, 2012
|
|
%
|
|
$ Increase
(Decrease)
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||
Rental income
|
$
|
447.7
|
|
|
|
|
$
|
416.0
|
|
|
|
|
$
|
31.7
|
|
||
Tenant reimbursements
|
104.6
|
|
|
|
|
106.7
|
|
|
|
|
(2.1
|
)
|
|||||
Property management fee revenue
|
2.2
|
|
|
|
|
2.3
|
|
|
|
|
(0.1
|
)
|
|||||
Total revenues
|
554.5
|
|
|
100
|
%
|
|
525.0
|
|
|
100
|
%
|
|
29.5
|
|
|||
Expense:
|
|
|
|
|
|
|
|
|
|
||||||||
Property operating costs
|
223.0
|
|
|
40
|
%
|
|
208.3
|
|
|
40
|
%
|
|
14.7
|
|
|||
Depreciation
|
122.5
|
|
|
22
|
%
|
|
110.3
|
|
|
21
|
%
|
|
12.2
|
|
|||
Amortization
|
45.7
|
|
|
9
|
%
|
|
49.5
|
|
|
9
|
%
|
|
(3.8
|
)
|
|||
Impairment losses on real estate assets
|
1.2
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
1.2
|
|
|||
General and administrative
|
21.9
|
|
|
4
|
%
|
|
20.8
|
|
|
4
|
%
|
|
1.1
|
|
|||
Real estate operating income
|
140.2
|
|
|
25
|
%
|
|
136.1
|
|
|
26
|
%
|
|
4.1
|
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(73.6
|
)
|
|
13
|
%
|
|
(65.0
|
)
|
|
12
|
%
|
|
(8.6
|
)
|
|||
Interest and other income/(expense)
|
(2.4
|
)
|
|
—
|
%
|
|
0.8
|
|
|
—
|
%
|
|
(3.2
|
)
|
|||
Litigation settlement recovery/(expense)
|
1.3
|
|
|
—
|
%
|
|
(7.5
|
)
|
|
2
|
%
|
|
8.8
|
|
|||
Net casualty recoveries/(loss)
|
10.6
|
|
|
2
|
%
|
|
(5.2
|
)
|
|
1
|
%
|
|
15.8
|
|
|||
Equity in income/(loss) of unconsolidated joint ventures
|
(3.7
|
)
|
|
1
|
%
|
|
0.9
|
|
|
—
|
%
|
|
(4.6
|
)
|
|||
Loss on consolidation
|
(0.9
|
)
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
(0.9
|
)
|
|||
Income from continuing operations
|
$
|
71.5
|
|
|
13
|
%
|
|
$
|
60.1
|
|
|
11
|
%
|
|
$
|
11.4
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income from discontinued operations
|
$
|
27.3
|
|
|
|
|
$
|
33.1
|
|
|
|
|
$
|
(5.8
|
)
|
|
December 31, 2012
|
|
%
|
|
December 31, 2011
|
|
%
|
|
$ Increase
(Decrease)
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||
Rental income
|
$
|
416.0
|
|
|
|
|
$
|
409.7
|
|
|
|
|
$
|
6.3
|
|
||
Tenant reimbursements
|
106.7
|
|
|
|
|
113.8
|
|
|
|
|
(7.1
|
)
|
|||||
Property management fee revenue
|
2.3
|
|
|
|
|
1.6
|
|
|
|
|
0.7
|
|
|||||
Total revenues
|
525.0
|
|
|
100
|
%
|
|
525.1
|
|
|
100
|
%
|
|
(0.1
|
)
|
|||
Expense:
|
|
|
|
|
|
|
|
|
|
||||||||
Property operating costs
|
208.3
|
|
|
40
|
%
|
|
202.5
|
|
|
39
|
%
|
|
5.8
|
|
|||
Depreciation
|
110.3
|
|
|
21
|
%
|
|
100.7
|
|
|
19
|
%
|
|
9.6
|
|
|||
Amortization
|
49.5
|
|
|
9
|
%
|
|
54.0
|
|
|
10
|
%
|
|
(4.5
|
)
|
|||
General and administrative expense
|
20.8
|
|
|
4
|
%
|
|
25.1
|
|
|
5
|
%
|
|
(4.3
|
)
|
|||
Real estate operating income
|
136.1
|
|
|
26
|
%
|
|
142.8
|
|
|
27
|
%
|
|
(6.7
|
)
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(65.0
|
)
|
|
12
|
%
|
|
(65.8
|
)
|
|
12
|
%
|
|
0.8
|
|
|||
Interest and other income
|
0.8
|
|
|
—
|
%
|
|
2.9
|
|
|
1
|
%
|
|
(2.1
|
)
|
|||
Litigation settlement recovery/(expense)
|
(7.5
|
)
|
|
2
|
%
|
|
—
|
|
|
—
|
%
|
|
(7.5
|
)
|
|||
Net casualty recoveries/(loss)
|
(5.2
|
)
|
|
1
|
%
|
|
—
|
|
|
—
|
%
|
|
(5.2
|
)
|
|||
Equity in income of unconsolidated joint ventures
|
0.9
|
|
|
—
|
%
|
|
1.6
|
|
|
—
|
%
|
|
(0.7
|
)
|
|||
Gain on consolidation of variable interest entity
|
—
|
|
|
—
|
%
|
|
1.5
|
|
|
—
|
%
|
|
(1.5
|
)
|
|||
Gain on extinguishment of debt
|
—
|
|
|
—
|
%
|
|
1.1
|
|
|
—
|
%
|
|
(1.1
|
)
|
|||
Income from continuing operations
|
$
|
60.1
|
|
|
11
|
%
|
|
$
|
84.1
|
|
|
16
|
%
|
|
$
|
(24.0
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income from discontinued operations
|
$
|
33.1
|
|
|
|
|
$
|
141.0
|
|
|
|
|
$
|
(107.9
|
)
|
|
2013
|
|
Per
Share
(1)
|
|
2012
|
|
Per
Share
(1)
|
|
2011
|
|
Per
Share
(1)
|
||||||||||||
Net income attributable to Piedmont
|
$
|
98,728
|
|
|
$
|
0.60
|
|
|
$
|
93,204
|
|
|
$
|
0.55
|
|
|
$
|
225,041
|
|
|
$
|
1.30
|
|
Depreciation of real assets
(2)
|
124,138
|
|
|
0.75
|
|
|
114,340
|
|
|
0.67
|
|
|
110,421
|
|
|
0.64
|
|
||||||
Amortization of lease-related costs
(2)
|
46,020
|
|
|
0.28
|
|
|
50,410
|
|
|
0.29
|
|
|
60,132
|
|
|
0.35
|
|
||||||
Loss/(gain) on consolidation
|
898
|
|
|
0.01
|
|
|
—
|
|
|
—
|
|
|
(1,532
|
)
|
|
(0.01
|
)
|
||||||
Impairment loss
(2)
|
12,046
|
|
|
0.07
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Gain on sale- wholly-owned properties
|
(31,292
|
)
|
|
(0.19
|
)
|
|
(27,577
|
)
|
|
(0.16
|
)
|
|
(122,657
|
)
|
|
(0.71
|
)
|
||||||
Gain on sale- unconsolidated partnerships
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(116
|
)
|
|
—
|
|
||||||
Funds From Operations
|
$
|
250,538
|
|
|
$
|
1.52
|
|
|
$
|
230,377
|
|
|
$
|
1.35
|
|
|
$
|
271,289
|
|
|
$
|
1.57
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Acquisition costs
|
1,763
|
|
|
0.01
|
|
|
141
|
|
|
—
|
|
|
1,347
|
|
|
0.01
|
|
||||||
Gain on extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,039
|
)
|
|
(0.01
|
)
|
||||||
Litigation settlement expense/(recovery)
|
(1,250
|
)
|
|
(0.01
|
)
|
|
7,500
|
|
|
0.05
|
|
|
—
|
|
|
—
|
|
||||||
Net casualty loss/(recoveries)
|
(10,578
|
)
|
|
(0.06
|
)
|
|
5,170
|
|
|
0.03
|
|
|
—
|
|
|
—
|
|
||||||
Core Funds From Operations
|
$
|
240,473
|
|
|
$
|
1.46
|
|
|
$
|
243,188
|
|
|
$
|
1.43
|
|
|
$
|
271,597
|
|
|
$
|
1.57
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred financing cost amortization
|
2,587
|
|
|
0.01
|
|
|
2,648
|
|
|
0.01
|
|
|
3,195
|
|
|
0.02
|
|
||||||
Amortization of fair market adjustments on notes payable
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,413
|
|
|
0.01
|
|
||||||
Amortization of discount on Senior Notes and swap settlements
|
33
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Depreciation of non real estate assets
|
406
|
|
|
—
|
|
|
502
|
|
|
—
|
|
|
499
|
|
|
—
|
|
||||||
Straight-line effects of lease revenue
(2)
|
(18,097
|
)
|
|
(0.11
|
)
|
|
(17,153
|
)
|
|
(0.10
|
)
|
|
(9,507
|
)
|
|
(0.06
|
)
|
||||||
Stock-based and other non-cash compensation
|
1,590
|
|
|
0.01
|
|
|
2,246
|
|
|
0.01
|
|
|
4,705
|
|
|
0.03
|
|
||||||
Net effect of amortization of below-market in-place lease intangibles
(2)
|
(5,278
|
)
|
|
(0.03
|
)
|
|
(5,678
|
)
|
|
(0.03
|
)
|
|
(7,065
|
)
|
|
(0.04
|
)
|
||||||
Income from amortization of discount on purchase of mezzanine loans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(484
|
)
|
|
—
|
|
||||||
Acquisition costs
|
(1,763
|
)
|
|
(0.01
|
)
|
|
(141
|
)
|
|
—
|
|
|
(1,347
|
)
|
|
(0.01
|
)
|
||||||
Non-incremental capital expenditures
(3)
|
(102,977
|
)
|
|
(0.62
|
)
|
|
(87,657
|
)
|
|
(0.51
|
)
|
|
(60,401
|
)
|
|
(0.35
|
)
|
||||||
Adjusted Funds From Operations
|
$
|
116,974
|
|
|
$
|
0.71
|
|
|
$
|
137,955
|
|
|
$
|
0.81
|
|
|
$
|
202,605
|
|
|
$
|
1.17
|
|
Weighted-average shares outstanding – diluted
|
165,137
|
|
|
|
|
170,441
|
|
|
|
|
172,981
|
|
|
|
(1)
|
Based on weighted-average shares outstanding—diluted.
|
(2)
|
Includes adjustments for wholly-owned properties (including discontinued operations), as well as such adjustments for our proportionate ownership in unconsolidated joint ventures.
|
(3)
|
Piedmont defines non-incremental capital expenditures as capital expenditures of a recurring nature related to tenant improvements, leasing commissions, and building capital that do not incrementally enhance the underlying assets' income generating capacity. Tenant improvements, leasing commissions, building capital and deferred lease incentives incurred to lease space that was vacant at acquisition, leasing costs for spaces vacant for greater than one year, leasing costs for spaces at newly acquired properties for which in-place leases expire shortly after acquisition, improvements associated with the expansion of a building, and renovations that either change the underlying classification from a Class B to a Class A property or enhance the marketability of a building are excluded from this measure.
|
|
December 31,
2013 |
|
December 31,
2012 |
||||
|
|
|
|
||||
Net income attributable to Piedmont
|
$
|
98,728
|
|
|
$
|
93,204
|
|
|
|
|
|
||||
Net income attributable to noncontrolling interest
|
15
|
|
|
15
|
|
||
Interest expense
|
73,583
|
|
|
65,023
|
|
||
Depreciation
(1)
|
124,545
|
|
|
114,843
|
|
||
Amortization
(1)
|
46,020
|
|
|
50,410
|
|
||
Acquisition costs
|
1,763
|
|
|
141
|
|
||
Impairment loss
(1)
|
12,046
|
|
|
—
|
|
||
Litigation settlement expense/(recovery)
|
(1,250
|
)
|
|
7,500
|
|
||
Net casualty (gain)/loss
(1)
|
(10,578
|
)
|
|
5,170
|
|
||
Gain on sale of real estate assets
(1)
|
(31,292
|
)
|
|
(27,577
|
)
|
||
Loss on consolidation
|
898
|
|
|
—
|
|
||
General & administrative expenses
(1)
|
22,016
|
|
|
20,939
|
|
||
Management fee revenue
|
(2,251
|
)
|
|
(2,318
|
)
|
||
Interest income and other expense/(income)
(1)
|
563
|
|
|
(995
|
)
|
||
Straight line rent adjustment
(1)
|
(18,097
|
)
|
|
(17,153
|
)
|
||
Net effect of amortization of below-market in-place lease intangibles
(1)
|
(5,278
|
)
|
|
(5,678
|
)
|
||
Property NOI (cash basis)
|
311,431
|
|
|
303,524
|
|
||
|
|
|
|
||||
Acquisitions
(2)
|
(14,982
|
)
|
|
24
|
|
||
Dispositions
(3)
|
(2,670
|
)
|
|
(6,526
|
)
|
||
Unconsolidated joint ventures
|
(1,892
|
)
|
|
(2,499
|
)
|
||
|
|
|
|
||||
Same Store NOI
|
$
|
291,887
|
|
|
$
|
294,523
|
|
|
|
|
|
||||
Change period over period in Same Store NOI
|
(0.9
|
)%
|
|
N/A
|
|
(1)
|
Includes amounts attributable to consolidated properties, including discontinued operations, and our proportionate share of amounts attributable to unconsolidated joint ventures.
|
(2)
|
Acquisitions consist of Gavitello Land in Atlanta, Georgia, purchased on June 28, 2012; Glenridge Highlands III Land in Atlanta, Georgia, purchased on October 15, 2012; Arlington Gateway in Arlington, Virginia, purchased on March 4, 2013; 5 & 15 Wayside Road in Burlington, Massachusetts, purchased on March 22, 2013; Royal Lane Land in Irving, Texas, purchased on August 1, 2013; 5301 Maryland Way in Brentwood, Tennessee, 4685 Investment Drive in Troy, Michigan, and 2020 West 89th Street in Leawood, Kansas, the remaining equity interests in which were purchased on August 12, 2013; 6565 North MacArthur Boulevard in Irving, Texas, purchased on December 5, 2013; One Lincoln Park in Dallas, Texas, purchased on December 20, 2013; and 161 Corporate Center in Irving, Texas, purchased on December 30, 2013.
|
(3)
|
Dispositions consist of Deschutes, Rhein, Rogue, Willamette, and Portland Land Parcels in Beaverton, Oregon, sold on March 19,
|
Buildings
|
40 years
|
Building improvements
|
5-25 years
|
Land improvements
|
20-25 years
|
Tenant improvements
|
Shorter of economic life or lease term
|
Furniture, fixtures, and equipment
|
3-5 years
|
Intangible lease assets
|
Lease term
|
|
|
Payments Due by Period
|
||||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less than
1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than
5 years
|
||||||||||
Long-term debt
(1)
|
|
$
|
2,003,525
|
|
|
$
|
575,000
|
|
|
$
|
938,525
|
|
(2) (3)
|
$
|
140,000
|
|
|
$
|
350,000
|
|
Operating lease obligations
(4)
|
|
43,326
|
|
|
451
|
|
|
902
|
|
|
902
|
|
|
41,071
|
|
|||||
Total
|
|
$
|
2,046,851
|
|
|
$
|
575,451
|
|
|
$
|
939,427
|
|
|
$
|
140,902
|
|
|
$
|
391,071
|
|
(1)
|
Amounts include principal payments only. We made interest payments of
$69.8 million
, including interest rate swap cash settlements related to various interest rate swap agreements in force and capitalized interest, during the year ended
December 31, 2013
and expect to pay interest in future periods on outstanding debt obligations based on the rates and terms disclosed herein and in Note 5 of our accompanying consolidated financial statements.
|
(2)
|
Includes the $300 Million Unsecured 2011 Term Loan which has a stated variable rate; however, we entered into interest rate swap agreements which effectively fix, exclusive of changes to our credit rating, the rate on this facility to
2.69%
through maturity. As such, we estimate incurring, exclusive of changes to our credit rating, approximately $8.1 million per annum in total interest (comprised of combination of variable contractual rate and settlements under interest rate swap agreements) through maturity in November 2016.
|
(3)
|
Includes the balance outstanding as of
December 31, 2013
of the
$500 Million
Unsecured Line of Credit. However, Piedmont may extend the term for up to one additional year (through two available six month extensions to a final extended maturity date of August 21, 2017) provided Piedmont is not then in default and upon payment of extension fees.
|
(4)
|
Two properties (the 2001 NW 64th Street building in Ft. Lauderdale, Florida and the River Corporate Center building in Tempe, Arizona) are subject to ground leases with expiration dates of
2048
and
2101
, respectively. The aggregate remaining payments required under the terms of these operating leases as of
December 31, 2013
are presented above.
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
Thereafter
|
|
Total
|
||||||||||||||
Maturing debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Variable rate repayments
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
366,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
366,000
|
|
Variable rate average interest rate
|
—
|
|
|
—
|
|
|
1.35
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.35
|
%
|
|||||||
Fixed rate repayments
|
$
|
575,000
|
|
|
$
|
105,000
|
|
|
$
|
467,525
|
|
(2)
|
$
|
140,000
|
|
|
$
|
—
|
|
|
$
|
350,000
|
|
|
$
|
1,637,525
|
|
Fixed rate average interest rate
(1)
|
4.89
|
%
|
|
5.29
|
%
|
|
3.72
|
%
|
|
5.76
|
%
|
|
—
|
|
|
3.40
|
%
|
|
4.34
|
%
|
(1)
|
See Note 5 of our accompanying consolidated financial statements for further details on our debt structure.
|
(2)
|
The amount includes the $300 Million Unsecured 2011 Term Loan which has a stated variable rate; however, Piedmont entered into interest rate swap agreements which effectively fix the rate on this loan to
2.69%
through
November 22, 2016
(provided that we maintain our corporate credit rating).
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
Thereafter
|
|
Total
|
||||||||||||||
Maturing debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Variable rate repayments
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
129,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
129,000
|
|
Variable rate average interest rate
|
—
|
|
|
—
|
|
|
—
|
|
|
1.39
|
%
|
|
—
|
|
|
—
|
|
|
1.39
|
%
|
|||||||
Fixed rate repayments
|
$
|
—
|
|
|
$
|
575,000
|
|
|
$
|
105,000
|
|
|
$
|
467,525
|
|
(1)
|
$
|
140,000
|
|
|
$
|
—
|
|
|
$
|
1,287,525
|
|
Fixed rate average interest rate
(1)
|
—
|
|
|
4.89
|
%
|
|
5.29
|
%
|
|
3.72
|
%
|
|
5.76
|
%
|
|
—
|
|
|
4.59
|
%
|
(1)
|
The amount includes the $300 Million Unsecured 2011 Term Loan which has a stated variable rate; however, Piedmont entered into interest rate swap agreements which effectively fix the rate on this loan to
2.69%
through
November 22, 2016
(provided that we maintain our corporate credit rating).
|
•
|
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and disposition of our assets;
|
•
|
provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of management and/or members of the board of directors; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.
|
(a)
|
1. The financial statements begin on page F-4 of this Annual Report on Form 10-K, and the list of the financial statements contained herein is set forth on page F-1, which is hereby incorporated by reference.
|
(a)
|
2. Schedule III—Real Estate Assets and Accumulated Depreciation.
|
(b)
|
The Exhibits filed in response to Item 601 of Regulation S-K are listed on the Exhibit Index attached hereto.
|
(c)
|
See (a) 2. above.
|
Piedmont Office Realty Trust, Inc.
|
||
(Registrant)
|
||
|
|
|
By:
|
|
/s/ D
ONALD
A. M
ILLER
, CFA
|
|
|
Donald A. Miller, CFA
|
|
|
President, Principal Executive Officer, and Director
|
Signature
|
|
Title
|
Date
|
|
|
|
|
/s/ M
ICHAEL
R. B
UCHANAN
|
|
Director
|
February 18, 2014
|
Michael R. Buchanan
|
|
|
|
|
|
|
|
/s/ D
ONALD
S. M
OSS
|
|
Director
|
February 18, 2014
|
Donald S. Moss
|
|
|
|
|
|
|
|
/s/ W
ESLEY
E. C
ANTRELL
|
|
Director
|
February 18, 2014
|
Wesley E. Cantrell
|
|
|
|
|
|
|
|
/s/ W
ILLIAM
H. K
EOGLER
, J
R
.
|
|
Director
|
February 18, 2014
|
William H. Keogler, Jr.
|
|
|
|
|
|
|
|
/s/ J
EFFREY
L. S
WOPE
|
|
Director
|
February 18, 2014
|
Jeffrey L. Swope
|
|
|
|
|
|
|
|
/s/ F
RANK
C. M
C
D
OWELL
|
|
Director
|
February 18, 2014
|
Frank C. McDowell
|
|
|
|
|
|
|
|
/s/ R
AYMOND
G. M
ILNES
, J
R
.
|
|
Director
|
February 18, 2014
|
Raymond G. Milnes, Jr.
|
|
|
|
|
|
|
|
/s/ W. W
AYNE
W
OODY
|
|
Chairman, and Director
|
February 18, 2014
|
W. Wayne Woody
|
|
|
|
|
|
|
|
/s/ D
ONALD
A. M
ILLER
, CFA
|
|
President and Director
|
February 18, 2014
|
Donald A. Miller, CFA
|
|
(Principal Executive Officer)
|
|
|
|
|
|
/s/ R
OBERT
E. B
OWERS
|
|
Chief Financial Officer and
Executive Vice-President
|
February 18, 2014
|
Robert E. Bowers
|
|
(Principal Financial Officer)
|
|
|
|
|
|
/s/ L
AURA
P. M
OON
|
|
Chief Accounting Officer
|
February 18, 2014
|
Laura P. Moon
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
Exhibit Number
|
|
Description of Document
|
|
|
|
3.1
|
|
Third Articles of Amendment and Restatement of Piedmont Office Realty Trust, Inc. (f/k/a Wells Real Estate Investment Trust, Inc.) (the "Company") (incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2009, filed on March 16, 2010)
|
|
|
|
3.2
|
|
Articles of Amendment of the Company effective June 30, 2011 (incorporated by reference to Exhibit 3.2 to the Company's Current Report on Form 8-K filed on July 6, 2011)
|
|
|
|
3.3
|
|
Articles Supplementary of the Company effective June 30, 2011 (incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K filed on July 6, 2011)
|
|
|
|
3.4
|
|
Amended and Restated Bylaws of Piedmont Office Realty Trust, Inc. (incorporated by reference to Exhibit 3.2 to the Company's Current Report on Form 8-K, filed on January 22, 2010)
|
|
|
|
4.1
|
|
Indenture, dated May 9, 2013, by and among Piedmont Operating Partnership, LP (the "Operating Partnership"), the Company and U.S. Bank National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K, filed on May 13, 2013)
|
|
|
|
4.2
|
|
Form of 3.40% Senior Notes due 2023 (included in Exhibit 4.1 hereto)
|
|
|
|
10.1
|
|
Amended and Restated Joint Venture Partnership Agreement of Fund XI-Fund XII-REIT Joint Venture dated June 21, 1999, by and among Wells Real Estate Fund XI, L.P., Wells Real Estate Fund XII, L.P. and the Operating Partnership (incorporated by reference to Exhibit 10.29 to Amendment No. 1 to the Company’s Form S-11 Registration Statement (Commission File No. 333-83933), filed on November 17, 1999)
|
|
|
|
10.2
|
|
Joint Venture Partnership Agreement of Wells Fund XII-REIT Joint Venture Partnership dated April 10, 2000, by and between the Operating Partnership and Wells Real Estate Fund XII, L.P. (incorporated by reference to Exhibit 10.11 to Post-Effective Amendment No. 2 to the Company’s Form S-11 Registration Statement (Commission File No. 333-66657), filed on April 25, 2000)
|
|
|
|
10.3
|
|
Joint Venture Partnership Agreement of Wells Fund XIII-REIT Joint Venture Partnership dated June 27, 2001, by and between the Operating Partnership and Wells Real Estate Investment Fund XIII, L.P. (incorporated by reference to Exhibit 10.85 to Post-Effective Amendment No. 3 to the Company’s Form S-11 Registration Statement (Commission File No. 333-44900), filed on July 23, 2001)
|
|
|
|
10.4
|
|
Amended and Restated Promissory Note dated November 1, 2007, by 1201 Eye Street, N.W. Associates LLC in favor of Metropolitan Life Insurance Company (incorporated by reference to Exhibit 10.9 to the Company’s Form 10-K for the fiscal year ended December 31, 2007 filed on March 26, 2008)
|
|
|
|
10.5
|
|
Amended and Restated Deed of Trust, Security Agreement and Fixture Filing dated November 1, 2007, by 1201 Eye Street, N.W. Associates LLC for the benefit of Metropolitan Life Insurance Company (incorporated by reference to Exhibit 10.10 to the Company’s Form 10-K for the fiscal year ended December 31, 2007 filed on March 26, 2008)
|
|
|
|
10.6
|
|
Amended and Restated Promissory Note dated November 1, 2007, by 1225 Eye Street, N.W. Associates LLC in favor of Metropolitan Life Insurance Company (incorporated by reference to Exhibit 10.11 to the Company’s Form 10-K for the fiscal year ended December 31, 2007 filed on March 26, 2008)
|
|
|
|
10.7
|
|
Amended and Restated Deed of Trust, Security Agreement and Fixture Filing dated October 24, 2002, by 1225 Eye Street, N.W. Associates LLC for the benefit of Metropolitan Life Insurance Company (incorporated by reference to Exhibit 10.12 to the Company’s Form 10-K for the fiscal year ended December 31, 2007 filed on March 26, 2008)
|
|
|
|
10.8
|
|
Limited Liability Company Agreement of 1201 Eye Street, N.W. Associates, LLC dated September 27, 2002 (incorporated by reference to Exhibit 10.119 to Post-Effective Amendment No. 6 to the Company’s Form S-11 Registration Statement (Commission File No. 333-85848), filed on December 17, 2003)
|
|
|
|
10.9
|
|
First Amendment to Limited Liability Company Agreement of 1201 Eye Street, N.W. Associates, LLC (incorporated by reference to Exhibit 10.120 to Post-Effective Amendment No. 6 to Company’s Form S-11 Registration Statement (Commission File No. 333-85848), filed on December 17, 2003)
|
|
|
|
10.10
|
|
Limited Liability Company Agreement of 1225 Eye Street, N.W. Associates, LLC dated September 27, 2002 (incorporated by reference to Exhibit 10.121 to Post-Effective Amendment No. 6 to the Company’s Form S-11 Registration Statement (Commission File No. 333-85848), filed on December 17, 2003)
|
|
|
|
10.11
|
|
First Amendment to Limited Liability Company Associates of 1225 Eye Street, N.W. Associates, LLC (incorporated by reference to Exhibit 10.122 to Post-Effective Amendment No. 6 to the Company’s Form S-11 Registration Statement (Commission File No. 333-85848), filed on December 17, 2003)
|
|
|
|
10.12
|
|
Promissory Note dated April 20, 2004, by Wells REIT-Chicago Center Owner, LLC in favor of Metropolitan Life Insurance Company (incorporated by reference to Exhibit 10.174 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2004, filed on August 6, 2004)
|
|
|
|
10.13
|
|
Mortgage, Security Agreement and Fixture Filing by Wells REIT-Chicago Center Owner, LLC to Metropolitan Life Insurance Company (incorporated by reference to Exhibit 10.175 to the Company’s Form 10-Q for the quarterly period ended June 30, 2004, filed on August 6, 2004)
|
|
|
|
10.14
|
|
Loan Agreement (Multi-State) dated May 21, 2004, between Wells REIT-Austin, TX, L.P., Wells REIT—Multi-State Owner, LLC, Wells REIT-Nashville, TN, LLC and Wells REIT—Bridgewater, NJ, LLC; and Morgan Stanley Mortgage Capital Inc. (incorporated by reference to Exhibit 10.176 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2004, filed on August 6, 2004)
|
|
|
|
10.15
|
|
Loan Agreement (D.C. Properties) dated May 21, 2004, between Wells REIT-Independence Square, LLC and Morgan Stanley Mortgage Capital Inc. (incorporated by reference to Exhibit 10.177 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2004, filed on August 6, 2004)
|
|
|
|
10.16
|
|
Promissory Note dated May 5, 2005, by Wells REIT-800 Nicollett Avenue Owner, LLC. in favor of Wachovia Bank, N.A. (incorporated by reference to Exhibit 10.70 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2005, filed on August 5, 2005)
|
|
|
|
10.17
|
|
Fixed Rate Note dated May 4, 2005, by 4250 N. Fairfax Owner, LLC in favor of JPMorgan Chase Bank, N.A. (incorporated by reference to Exhibit 10.71 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2005, filed on August 5, 2005)
|
|
|
|
10.18
|
|
Amended and Restated Dividend Reinvestment Plan of the Company adopted February 24, 2011 (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on February 24, 2011)
|
|
|
|
10.19*
|
|
Employment Agreement dated February 2, 2007, by and between the Company and Donald A. Miller, CFA (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on February 5, 2007)
|
|
|
|
10.20*
|
|
Amendment Number One to Employment Agreement dated February 2, 2007, by and between the Company and Donald A. Miller, CFA (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, filed on September 14, 2011)
|
|
|
|
10.21*
|
|
Piedmont Office Realty Trust, Inc. 2007 Omnibus Incentive Plan (f/k/a the Wells Real Estate Investment Trust, Inc. 2007 Omnibus Incentive Plan) (incorporated by reference to Exhibit 99.7 to the Company’s Current Report on Form 8-K, filed on April 20, 2007)
|
|
|
|
10.22*
|
|
Amendment Number One to the Piedmont Office Realty Trust, Inc. 2007 Omnibus Incentive Plan (f/k/a the Wells Real Estate Investment Trust, Inc. 2007 Omnibus Incentive Plan) (incorporated by reference to Exhibit 10.12 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2011, filed on August 9, 2011)
|
|
|
|
10.23
|
|
Amended and Restated Agreement of Limited Partnership of the Operating Partnership, dated January 1, 2000 (incorporated by reference to Exhibit 10.64 to the Company's Annual Report on Form 10-K for the year ended December 31, 2000, filed on March 28, 2001)
|
|
|
|
10.24
|
|
Amendment to Agreement of Limited Partnership of the Operating Partnership, as Amended and Restated as of January 1, 2000, dated April 16, 2007 (incorporated by reference to Exhibit 99.8 to the Company’s Current Report on Form 8-K, filed on April 20, 2007)
|
|
|
|
10.25
|
|
Amendment to Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership, as Amended and Restated as of January 1, 2000, dated August 8, 2007 (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on August 10, 2007)
|
|
|
|
10.26*
|
|
Employment Agreement dated April 16, 2007, by and between the Company and Robert E. Bowers (incorporated by reference to Exhibit 99.9 to the Company’s Current Report on Form 8-K, filed on April 20, 2007)
|
|
|
|
10.27*
|
|
Employment Agreement dated May 14, 2007, by and between the Company and Carroll A. “Bo” Reddic, IV (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on May 14, 2007)
|
|
|
|
10.28*
|
|
Employment Agreement dated May 14, 2007, by and between the Company and Raymond L. Owens (incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K, filed on May 14, 2007)
|
|
|
|
10.29*
|
|
Employment Agreement dated May 14, 2007, by and between the Company and Laura P. Moon (incorporated by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K, filed on May 14, 2007)
|
|
|
|
10.30*
|
|
Form of Employee Deferred Stock Award Agreement for 2007 Omnibus Incentive Plan of the Company effective May 18, 2007 (incorporated by reference to Exhibit 10.82 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2007, filed on August 7, 2007)
|
|
|
|
10.31
|
|
Term Loan Agreement, dated as of November 22, 2011, among the Operating Partnership, as Borrower, the Company, as Parent, JP Morgan Securities, LLC, and Suntrust Robinson Humphrey, Inc., as Joint-Lead Arrangers and Book Runners, JPMorgan Chase Bank as Administrative Agent, Suntrust Bank as Syndication Agent, Wells Fargo Bank as Documentation Agent, the other banks signatory thereto as Lenders (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, filed on November 29, 2011)
|
|
|
|
10.32*
|
|
2010 Long-Term Incentive Program Award Agreement (incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011, filed on November 3, 2011)
|
|
|
|
10.33*
|
|
2010 Long-Term Incentive Program (incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011, filed on November 3, 2011)
|
|
|
|
10.34*
|
|
Long-Term Incentive Program Award Agreement (incorporated by reference to Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011, filed on November 3, 2011)
|
|
|
|
10.35*
|
|
Long-Term Incentive Program (incorporated by reference to Exhibit 10.4 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011, filed on November 3, 2011)
|
|
|
|
10.36
|
|
Revolving Credit Agreement dated August 21, 2012, by and among Piedmont Operating Partnership, LP, the Company, J.P. Morgan Securities LLC, RBC Capital Markets LLC, JPMorgan Chase Bank, N. A., Royal Bank of Canada, PNC Bank, National Association, SunTrust Bank, and U.S. Bank National Association, and the other financial institutions initially signatory thereto and their assignees (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on August 23, 2012)
|
|
|
|
10.37
|
|
Amendment No. 1 to Term Loan Agreement, dated as of August 21, 2012, among Piedmont Operating Partnership, LP, as Borrower, Piedmont Office Realty Trust, Inc., as Parent, JPMorgan Chase Bank as Administrative Agent, and the other banks party thereto as Lenders (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on August 23, 2012)
|
|
|
|
10.38*
|
|
Offer Letter Dated October 17, 2012 among the Company and Robert K. Wiberg (incorporated by reference to Exhibit 10.41 to the Company's Annual Report of Form 10-K for the year ended December 31, 2012, filed on February 27, 2013)
|
|
|
|
10.39*
|
|
The Piedmont Office Realty Trust, Inc. Executive Nonqualified Deferred Compensation Plan dated December 5, 2013
|
|
|
|
10.40*
|
|
The Piedmont Office Realty Trust, Inc. Executive Nonqualified Deferred Compensation Plan Adoption Agreement dated December 5, 2013
|
|
|
|
10.41
|
|
Term Loan Agreement, dated as of December 18, 2013, among Piedmont Operating Partnership, LP, as Borrower, Piedmont Office Realty Trust, Inc., as Parent, U.S. Bank, N.A., and SunTrust Robinson Humphrey, Inc., as Joint Book Runners and Joint Lead Arrangers, U.S. Bank, N.A., as Agent, SunTrust Bank as Syndication Agent, the other banks signatory thereto as Lenders (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, filed on December 19, 2013)
|
|
|
|
12.1
|
|
Calculation of Ratio of Earnings to Fixed Charges
|
|
|
|
21.1
|
|
List of Subsidiaries of the Company
|
|
|
|
23.1
|
|
Consent of Ernst & Young LLP
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
32.1
|
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
32.2
|
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
Financial Statements
|
Page
|
|
|
Financial Statement Schedule
|
|
|
December 31, 2013
|
|
December 31, 2012
|
||||
Assets:
|
|
|
|
||||
Real estate assets, at cost:
|
|
|
|
||||
Land
|
$
|
688,761
|
|
|
$
|
629,536
|
|
Buildings and improvements, less accumulated depreciation of $979,934 and $883,957 as of December 31, 2013 and December 31, 2012, respectively
|
3,164,575
|
|
|
2,908,078
|
|
||
Intangible lease assets, less accumulated amortization of $71,820 and $67,940 as of December 31, 2013 and December 31, 2012, respectively
|
74,377
|
|
|
54,745
|
|
||
Construction in progress
|
24,270
|
|
|
20,373
|
|
||
Total real estate assets
|
3,951,983
|
|
|
3,612,732
|
|
||
Investments in unconsolidated joint ventures
|
14,122
|
|
|
37,226
|
|
||
Cash and cash equivalents
|
6,973
|
|
|
12,957
|
|
||
Tenant receivables, net of allowance for doubtful accounts of $346 and $346 as of December 31, 2013 and December 31, 2012, respectively
|
31,145
|
|
|
25,038
|
|
||
Straight-line rent receivables
|
139,406
|
|
|
122,299
|
|
||
Due from unconsolidated joint ventures
|
266
|
|
|
463
|
|
||
Restricted cash and escrows
|
394
|
|
|
334
|
|
||
Prepaid expenses and other assets
|
24,771
|
|
|
21,283
|
|
||
Goodwill
|
180,097
|
|
|
180,097
|
|
||
Interest rate swaps
|
24,176
|
|
|
1,075
|
|
||
Deferred financing costs, less accumulated amortization of $13,041 and $10,479 as of December 31, 2013 and December 31, 2012, respectively
|
8,759
|
|
|
6,454
|
|
||
Deferred lease costs, less accumulated amortization of $126,465 and $108,380 as of December 31, 2013 and December 31, 2012, respectively
|
283,996
|
|
|
234,917
|
|
||
Total assets
|
$
|
4,666,088
|
|
|
$
|
4,254,875
|
|
Liabilities:
|
|
|
|
||||
Unsecured debt
|
$
|
1,014,680
|
|
|
$
|
429,000
|
|
Secured debt
|
987,525
|
|
|
987,525
|
|
||
Accounts payable, accrued expenses, and accrued capital expenditures
|
128,818
|
|
|
127,263
|
|
||
Deferred income
|
22,267
|
|
|
21,552
|
|
||
Intangible lease liabilities, less accumulated amortization of $44,256 and $40,931 as of December 31, 2013 and December 31, 2012, respectively
|
47,113
|
|
|
40,805
|
|
||
Interest rate swaps
|
4,526
|
|
|
8,235
|
|
||
Total liabilities
|
2,204,929
|
|
|
1,614,380
|
|
||
Commitments and Contingencies
|
—
|
|
|
—
|
|
||
Stockholders’ Equity:
|
|
|
|
||||
Shares-in-trust, 150,000,000 shares authorized, none outstanding as of December 31, 2013 or December 31, 2012
|
—
|
|
|
—
|
|
||
Preferred stock, no par value, 100,000,000 shares authorized, none outstanding as of December 31, 2013 or December 31, 2012
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value; 750,000,000 shares authorized, 157,460,903 shares issued and outstanding as of December 31, 2013; and 167,556,001 shares issued and outstanding at December 31, 2012
|
1,575
|
|
|
1,676
|
|
||
Additional paid-in capital
|
3,668,906
|
|
|
3,667,051
|
|
||
Cumulative distributions in excess of earnings
|
(1,231,209
|
)
|
|
(1,022,681
|
)
|
||
Other comprehensive income/(loss)
|
20,278
|
|
|
(7,160
|
)
|
||
Piedmont stockholders’ equity
|
2,459,550
|
|
|
2,638,886
|
|
||
Noncontrolling interest
|
1,609
|
|
|
1,609
|
|
||
Total stockholders’ equity
|
2,461,159
|
|
|
2,640,495
|
|
||
Total liabilities and stockholders’ equity
|
$
|
4,666,088
|
|
|
$
|
4,254,875
|
|
|
Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Rental income
|
$
|
447,687
|
|
|
$
|
415,972
|
|
|
$
|
409,711
|
|
Tenant reimbursements
|
104,567
|
|
|
106,754
|
|
|
113,813
|
|
|||
Property management fee revenue
|
2,251
|
|
|
2,318
|
|
|
1,584
|
|
|||
|
554,505
|
|
|
525,044
|
|
|
525,108
|
|
|||
Expenses:
|
|
|
|
|
|
||||||
Property operating costs
|
222,979
|
|
|
208,280
|
|
|
202,531
|
|
|||
Depreciation
|
122,562
|
|
|
110,359
|
|
|
100,686
|
|
|||
Amortization
|
45,651
|
|
|
49,562
|
|
|
54,008
|
|
|||
Impairment loss
|
1,242
|
|
|
—
|
|
|
—
|
|
|||
General and administrative
|
21,883
|
|
|
20,765
|
|
|
25,072
|
|
|||
|
414,317
|
|
|
388,966
|
|
|
382,297
|
|
|||
Real estate operating income
|
140,188
|
|
|
136,078
|
|
|
142,811
|
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest expense
|
(73,583
|
)
|
|
(65,023
|
)
|
|
(65,817
|
)
|
|||
Interest income and other income/(expense)
|
(2,352
|
)
|
|
833
|
|
|
2,866
|
|
|||
Litigation settlement recovery/(expense)
|
1,250
|
|
|
(7,500
|
)
|
|
—
|
|
|||
Net casualty recoveries/(loss)
|
10,561
|
|
|
(5,170
|
)
|
|
—
|
|
|||
Equity in income/(loss) of unconsolidated joint ventures
|
(3,676
|
)
|
|
923
|
|
|
1,619
|
|
|||
Gain/(loss) on consolidation
|
(898
|
)
|
|
—
|
|
|
1,532
|
|
|||
Gain on extinguishment of debt
|
—
|
|
|
—
|
|
|
1,039
|
|
|||
|
(68,698
|
)
|
|
(75,937
|
)
|
|
(58,761
|
)
|
|||
Income from continuing operations
|
71,490
|
|
|
60,141
|
|
|
84,050
|
|
|||
Discontinued operations:
|
|
|
|
|
|
||||||
Operating income, excluding impairment loss
|
2,363
|
|
|
5,501
|
|
|
18,349
|
|
|||
Impairment loss
|
(6,402
|
)
|
|
—
|
|
|
—
|
|
|||
Gain on sale of real estate assets
|
31,292
|
|
|
27,577
|
|
|
122,657
|
|
|||
Income from discontinued operations
|
27,253
|
|
|
33,078
|
|
|
141,006
|
|
|||
Net income
|
98,743
|
|
|
93,219
|
|
|
225,056
|
|
|||
Less: Net income attributable to noncontrolling interest
|
(15
|
)
|
|
(15
|
)
|
|
(15
|
)
|
|||
Net income attributable to Piedmont
|
$
|
98,728
|
|
|
$
|
93,204
|
|
|
$
|
225,041
|
|
Per share information— basic and diluted:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
0.44
|
|
|
$
|
0.35
|
|
|
$
|
0.49
|
|
Income from discontinued operations
|
0.16
|
|
|
0.20
|
|
|
0.81
|
|
|||
Net income available to common stockholders
|
$
|
0.60
|
|
|
$
|
0.55
|
|
|
$
|
1.30
|
|
Weighted-average shares outstanding—basic
|
165,012,713
|
|
|
170,312,328
|
|
|
172,764,838
|
|
|||
Weighted-average shares outstanding—diluted
|
165,137,482
|
|
|
170,441,223
|
|
|
172,980,947
|
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net income attributable to Piedmont
|
|
|
$
|
98,728
|
|
|
|
|
$
|
93,204
|
|
|
|
|
$
|
225,041
|
|
|||
Other comprehensive income/(loss):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Effective portion of gain/(loss) on derivative instruments that are designated and qualify as cash flow hedges (See Note 7)
|
24,312
|
|
|
|
|
(7,656
|
)
|
|
|
|
(3,064
|
)
|
|
|
||||||
Reclassification of previously recorded loss included in net income (See Note 7)
|
3,126
|
|
|
|
|
3,033
|
|
|
|
|
1,218
|
|
|
|
||||||
Other comprehensive income/(loss)
|
|
|
27,438
|
|
|
|
|
(4,623
|
)
|
|
|
|
(1,846
|
)
|
||||||
Comprehensive income attributable to Piedmont
|
|
|
$
|
126,166
|
|
|
|
|
$
|
88,581
|
|
|
|
|
$
|
223,195
|
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Cumulative
Distributions in
Excess of Earnings
|
|
Other
Comprehensive
Income/(Loss)
|
|
Noncontrolling
Interest
|
|
Total
Stockholders’
Equity
|
|||||||||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||||||||
Balance, December 31, 2010
|
172,658
|
|
|
$
|
1,727
|
|
|
$
|
3,661,308
|
|
|
$
|
(895,122
|
)
|
|
$
|
(691
|
)
|
|
$
|
6,232
|
|
|
$
|
2,773,454
|
|
Share repurchases as part of announced plan
|
(199
|
)
|
|
(2
|
)
|
|
—
|
|
|
(3,242
|
)
|
|
—
|
|
|
—
|
|
|
(3,244
|
)
|
||||||
Offering costs associated with issuance of common stock
|
—
|
|
|
—
|
|
|
(479
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(479
|
)
|
||||||
Attribution of asset sales proceeds to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,684
|
)
|
|
(2,684
|
)
|
||||||
Dividends to common stockholders ($1.26 per share), distributions to noncontrolling interest, and dividends reinvested
|
—
|
|
|
—
|
|
|
(249
|
)
|
|
(217,709
|
)
|
|
—
|
|
|
(2,407
|
)
|
|
(220,365
|
)
|
||||||
Shares issued under the 2007 Omnibus Incentive Plan, net of tax
|
171
|
|
|
1
|
|
|
3,082
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,083
|
|
||||||
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
468
|
|
|
468
|
|
||||||
Net income attributable to Piedmont
|
—
|
|
|
—
|
|
|
—
|
|
|
225,041
|
|
|
—
|
|
|
—
|
|
|
225,041
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,846
|
)
|
|
—
|
|
|
(1,846
|
)
|
||||||
Balance, December 31, 2011
|
172,630
|
|
|
1,726
|
|
|
3,663,662
|
|
|
(891,032
|
)
|
|
(2,537
|
)
|
|
1,609
|
|
|
2,773,428
|
|
||||||
Share repurchases as part of an announced plan
|
(5,255
|
)
|
|
(52
|
)
|
|
—
|
|
|
(88,685
|
)
|
|
—
|
|
|
—
|
|
|
(88,737
|
)
|
||||||
Offering costs associated with issuance of common stock
|
—
|
|
|
—
|
|
|
567
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
567
|
|
||||||
Dividends to common stockholders ($0.80 per share), distributions to noncontrolling interest, and dividends reinvested
|
—
|
|
|
—
|
|
|
(195
|
)
|
|
(136,168
|
)
|
|
—
|
|
|
(15
|
)
|
|
(136,378
|
)
|
||||||
Shares issued under the 2007 Omnibus Incentive Plan, net of tax
|
181
|
|
|
2
|
|
|
3,017
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,019
|
|
||||||
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
15
|
|
||||||
Net income attributable to Piedmont
|
—
|
|
|
—
|
|
|
—
|
|
|
93,204
|
|
|
—
|
|
|
—
|
|
|
93,204
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,623
|
)
|
|
—
|
|
|
(4,623
|
)
|
||||||
Balance, December 31, 2012
|
167,556
|
|
|
1,676
|
|
|
3,667,051
|
|
|
(1,022,681
|
)
|
|
(7,160
|
)
|
|
1,609
|
|
|
2,640,495
|
|
||||||
Share repurchases as part of an announced plan
|
(10,246
|
)
|
|
(102
|
)
|
|
—
|
|
|
(175,167
|
)
|
|
—
|
|
|
—
|
|
|
(175,269
|
)
|
||||||
Offering costs associated with issuance of common stock
|
—
|
|
|
—
|
|
|
(91
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(91
|
)
|
||||||
Dividends to common stockholders ($0.80 per share), distributions to noncontrolling interest, and dividends reinvested
|
—
|
|
|
—
|
|
|
(197
|
)
|
|
(132,089
|
)
|
|
—
|
|
|
(15
|
)
|
|
(132,301
|
)
|
||||||
Shares issued under the 2007 Omnibus Incentive Plan, net of tax
|
151
|
|
|
1
|
|
|
2,143
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,144
|
|
||||||
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
15
|
|
||||||
Net income attributable to Piedmont
|
—
|
|
|
—
|
|
|
—
|
|
|
98,728
|
|
|
—
|
|
|
—
|
|
|
98,728
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,438
|
|
|
—
|
|
|
27,438
|
|
||||||
Balance, December 31, 2013
|
157,461
|
|
|
$
|
1,575
|
|
|
$
|
3,668,906
|
|
|
$
|
(1,231,209
|
)
|
|
$
|
20,278
|
|
|
$
|
1,609
|
|
|
$
|
2,461,159
|
|
|
Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
98,743
|
|
|
$
|
93,219
|
|
|
$
|
225,056
|
|
Operating distributions received from unconsolidated joint ventures
|
1,475
|
|
|
2,338
|
|
|
2,932
|
|
|||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Income attributable to noncontrolling interest- discontinued operations
|
—
|
|
|
—
|
|
|
453
|
|
|||
Depreciation
|
123,566
|
|
|
113,650
|
|
|
109,730
|
|
|||
Amortization of deferred financing costs and fair market value adjustments on notes payable
|
2,620
|
|
|
2,648
|
|
|
4,777
|
|
|||
Settlement of forward starting interest rate swaps
|
672
|
|
|
—
|
|
|
—
|
|
|||
Other amortization
|
43,939
|
|
|
47,479
|
|
|
56,688
|
|
|||
Impairment loss on wholly-owned properties
|
7,644
|
|
|
—
|
|
|
—
|
|
|||
Gain on extinguishment of debt
|
—
|
|
|
—
|
|
|
(1,041
|
)
|
|||
Accretion of discount on notes receivable
|
—
|
|
|
—
|
|
|
(482
|
)
|
|||
Stock compensation expense
|
1,590
|
|
|
2,246
|
|
|
4,705
|
|
|||
Reduction of long-lived assets due to casualty event
|
—
|
|
|
1,980
|
|
|
—
|
|
|||
Equity in income of unconsolidated joint ventures
|
3,676
|
|
|
(923
|
)
|
|
(1,609
|
)
|
|||
Loss/(gain) on consolidation
|
898
|
|
|
—
|
|
|
(1,532
|
)
|
|||
Gain on sale of real estate assets
|
(31,292
|
)
|
|
(27,577
|
)
|
|
(122,657
|
)
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Increase in tenant and straight-line rent receivables, net
|
(29,101
|
)
|
|
(21,720
|
)
|
|
(13,295
|
)
|
|||
(Increase)/decrease in restricted cash and escrows
|
(60
|
)
|
|
8,705
|
|
|
18,720
|
|
|||
Increase in prepaid expenses and other assets
|
(3,427
|
)
|
|
(3,837
|
)
|
|
(2,727
|
)
|
|||
(Decrease)/increase in accounts payable and accrued expenses
|
(6,434
|
)
|
|
8,486
|
|
|
3,511
|
|
|||
Increase/(decrease) in deferred income
|
570
|
|
|
(5,769
|
)
|
|
(16,134
|
)
|
|||
Net cash provided by operating activities
|
215,079
|
|
|
220,925
|
|
|
267,095
|
|
|||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||||||
Acquisition of real estate assets and related intangibles
|
(366,182
|
)
|
|
(4,225
|
)
|
|
(161,576
|
)
|
|||
Capitalized expenditures, net of accruals
|
(175,988
|
)
|
|
(104,262
|
)
|
|
(54,033
|
)
|
|||
Acquisition of unconsolidated joint ventures, net of cash assumed
|
(14,242
|
)
|
|
—
|
|
|
—
|
|
|||
Cash assumed upon consolidation of variable interest entity
|
—
|
|
|
—
|
|
|
5,063
|
|
|||
Net sale proceeds from wholly-owned properties and consolidated joint venture
|
95,671
|
|
|
93,839
|
|
|
291,785
|
|
|||
Net sale proceeds received from unconsolidated joint ventures
|
—
|
|
|
—
|
|
|
3,036
|
|
|||
Investments in unconsolidated joint ventures
|
(793
|
)
|
|
(136
|
)
|
|
(151
|
)
|
|||
Liquidation of noncontrolling interest upon sale of consolidated joint venture
|
—
|
|
|
—
|
|
|
(95
|
)
|
|||
Deferred lease costs paid
|
(34,298
|
)
|
|
(48,692
|
)
|
|
(47,049
|
)
|
|||
Net cash provided/(used in) by investing activities
|
(495,832
|
)
|
|
(63,476
|
)
|
|
36,980
|
|
|||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||||||
Deferred financing costs paid
|
(4,892
|
)
|
|
(3,125
|
)
|
|
(3,367
|
)
|
|||
Proceeds from debt
|
1,085,604
|
|
|
409,000
|
|
|
829,000
|
|
|||
Repayments of debt
|
(500,000
|
)
|
|
(465,000
|
)
|
|
(822,875
|
)
|
|||
Net costs of issuance of common stock
|
(91
|
)
|
|
(229
|
)
|
|
(252
|
)
|
|||
Repurchases of common stock as part of announced plan
|
(173,551
|
)
|
|
(88,450
|
)
|
|
(3,244
|
)
|
|||
Dividends paid and discount on dividend reinvestments
|
(132,301
|
)
|
|
(136,378
|
)
|
|
(220,365
|
)
|
|||
Net cash provided by/(used in) financing activities
|
274,769
|
|
|
(284,182
|
)
|
|
(221,103
|
)
|
|||
Net increase/(decrease) in cash and cash equivalents
|
(5,984
|
)
|
|
(126,733
|
)
|
|
82,972
|
|
|||
Cash and cash equivalents, beginning of year
|
12,957
|
|
|
139,690
|
|
|
56,718
|
|
|||
Cash and cash equivalents, end of year
|
$
|
6,973
|
|
|
$
|
12,957
|
|
|
$
|
139,690
|
|
|
December 31, 2013
|
|
December 31, 2012
|
||||
Intangible Lease Assets:
|
|
|
|
||||
Above-Market In-Place Lease Assets
|
$
|
21,137
|
|
|
$
|
21,468
|
|
Absorption Period Costs
|
$
|
125,060
|
|
|
$
|
101,217
|
|
Intangible Lease Origination Costs (included in Deferred Lease Costs)
|
$
|
158,427
|
|
|
$
|
116,995
|
|
Intangible Lease Liabilities (Below-Market In-Place Leases)
|
$
|
91,369
|
|
|
$
|
81,736
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Amortization expense related to Intangible Lease Origination Costs and Absorption Period Costs
|
$
|
30,409
|
|
|
$
|
36,151
|
|
|
$
|
48,013
|
|
Amortization of Above-Market and Below-Market In-Place Lease intangibles as a net increase to rental revenues
|
$
|
5,278
|
|
|
$
|
5,678
|
|
|
$
|
7,065
|
|
|
Intangible Lease Assets
|
|
|
|
|
||||||||||
|
Above-Market
In-place
Lease Assets
|
|
Absorption
Period Costs
|
|
Intangible Lease
Origination Costs
(1)
|
|
Below-Market
In-place Lease
Liabilities
|
||||||||
For the year ending December 31:
|
|
|
|
|
|
|
|
||||||||
2014
|
$
|
2,050
|
|
|
$
|
15,046
|
|
|
$
|
18,882
|
|
|
$
|
6,825
|
|
2015
|
1,891
|
|
|
13,789
|
|
|
17,490
|
|
|
6,328
|
|
||||
2016
|
1,662
|
|
|
10,996
|
|
|
14,652
|
|
|
6,205
|
|
||||
2017
|
886
|
|
|
8,241
|
|
|
11,671
|
|
|
6,300
|
|
||||
2018
|
309
|
|
|
5,687
|
|
|
8,726
|
|
|
5,702
|
|
||||
Thereafter
|
131
|
|
|
13,689
|
|
|
21,449
|
|
|
15,753
|
|
||||
|
$
|
6,929
|
|
|
$
|
67,448
|
|
|
$
|
92,870
|
|
|
$
|
47,113
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted-Average Amortization Period (in years)
|
4
|
|
|
6
|
|
|
6
|
|
|
8
|
|
(1)
|
Included as a component of Deferred Lease Costs in the accompanying consolidated balance sheets.
|
•
|
escrow accounts held by lenders to pay future real estate taxes, insurance, debt service, and tenant improvements;
|
•
|
net sales proceeds from property sales held by qualified intermediary for potential Section 1031 exchange;
|
•
|
earnest money paid in connection with future acquisitions; and
|
•
|
security and utility deposits paid by tenants per the terms of their respective leases.
|
•
|
prepaid property taxes, insurance and operating costs;
|
•
|
deferred common area maintenance costs which will be reimbursed by tenants over specified time periods;
|
•
|
receivables which are unrelated to tenants, for example, insurance proceeds receivable from insurers related to casualty losses; and
|
•
|
equipment, furniture and fixtures, and tenant improvements for Piedmont’s corporate office space, net of accumulated depreciation.
|
•
|
Approximately
$34.0 million
,
$29.8 million
, and
$30.0 million
of deferred lease costs for the years ended
December 31, 2013
,
2012
, and
2011
, respectively, are included in amortization expense; and
|
•
|
Approximately
$3.5 million
,
$2.5 million
, and
$3.7 million
, of deferred lease costs related to lease incentives granted to tenants for the years ended
December 31, 2013
,
2012
, and
2011
, respectively, was included as an offset to rental income.
|
•
|
prepaid rent from tenants; and
|
•
|
tenant reimbursements related to operating expense or property tax expenses which may be due to tenants as part of an annual operating expense reconciliation.
|
Property
|
|
Metropolitan Statistical Area
|
|
Date of Acquisition
|
|
Rentable Square Feet (Unaudited)
|
|
Percentage Leased as of Acquisition (Unaudited)
|
|
Contractual Purchase Price (in millions)
|
|||||
Arlington Gateway
|
|
Washington, D.C.
|
|
March 4, 2013
|
|
333,948
|
|
|
99
|
%
|
|
$
|
175.6
|
|
|
5 & 15 Wayside Road
|
|
Boston, MA
|
|
March 22, 2013
|
|
271,434
|
|
|
95
|
%
|
|
$
|
69.3
|
|
|
2020 W. 89th Street
|
(1)
|
Kansas City, KS
|
|
August 12, 2013
|
|
68,376
|
|
|
85
|
%
|
|
$
|
4.3
|
|
|
5301 Maryland Way
|
(1)
|
Nashville, TN
|
|
August 12, 2013
|
|
201,237
|
|
|
100
|
%
|
|
$
|
18.5
|
|
|
4685 Investment Drive
|
(1)
|
Detroit, MI
|
|
August 12, 2013
|
|
77,045
|
|
|
100
|
%
|
|
$
|
10.0
|
|
|
6565 MacArthur Blvd
|
|
Dallas, TX
|
|
December 5, 2013
|
|
259,819
|
|
|
93
|
%
|
|
$
|
46.6
|
|
|
One Lincoln Park
|
|
Dallas, TX
|
|
December 20, 2013
|
|
261,826
|
|
|
79
|
%
|
|
$
|
56.7
|
|
|
161 Corporate Center
|
|
Dallas, TX
|
|
December 30, 2013
|
|
104,895
|
|
|
91
|
%
|
|
$
|
16.0
|
|
|
Land Parcel
|
|
Metropolitan Statistical Area
|
|
Date of Acquisition
|
|
Acreage
|
|
Purchase Price (in millions)
|
|
|
|||||
Royal Lane
|
|
Dallas, TX
|
|
August 1, 2013
|
|
10.59
|
|
|
$
|
2.6
|
|
|
|
(
1)
|
On August 12, 2013, Piedmont purchased all of the remaining interests in
three
office properties previously held through
two
unconsolidated joint ventures for approximately
$14.7 million
in cash.
|
Name of Joint Venture
|
|
Properties Held by Joint Venture
|
|
Piedmont’s
Approximate
Ownership
Percentage
|
|
Net Book Value
|
|||||||
|
|
|
|
|
|
2013
|
|
2012
|
|||||
Fund XIII and REIT Joint Venture
|
|
8560 Upland Drive
Two Park Center |
|
72
|
%
|
|
$
|
14,122
|
|
|
$
|
18,814
|
|
Fund XII and REIT Joint Venture
|
(1)
|
4685 Investment Drive
5301 Maryland Way |
|
55
|
%
|
|
—
|
|
|
15,813
|
|
||
Fund XI, XII and REIT Joint Venture
|
(1)
|
2020 W. 89th Street
|
|
57
|
%
|
|
—
|
|
|
2,599
|
|
||
|
|
|
|
|
|
$
|
14,122
|
|
|
$
|
37,226
|
|
(1)
|
On August 12, 2013, Piedmont purchased all of the remaining interests in
three
office properties previously held through these
two
unconsolidated joint ventures for approximately
$14.7 million
in cash, representing the estimated fair value of the respective property, less Piedmont's existing investment in the respective unconsolidated joint ventures. Such estimated fair value was derived by reference to a credible, unrelated third-party offer and verified using discounted cash flow analysis. Under the terms of the respective joint venture agreements, Piedmont exercised its dissenter's right to buy out each of its co-venturers' interests based upon the terms of the third-party offer. The
$0.9 million
difference between the fair value of the properties acquired and the sum of Piedmont's previously recorded book value in investment in unconsolidated joint ventures plus cash consideration paid for the interests was recorded as a loss on consolidation in Piedmont's consolidated statement of operations for the year ended December 31, 2013.
|
Facility
|
|
Collateral
|
|
Rate
(1)
|
|
Maturity
|
|
Amount Outstanding
as of December 31,
|
|||||||
2013
|
|
2012
|
|||||||||||||
Secured (Fixed)
|
|
|
|
|
|
|
|
|
|
|
|||||
$200.0 Million Mortgage Note
|
|
Aon Center
|
|
4.87
|
%
|
|
5/1/2014
|
|
$
|
200,000
|
|
(10)
|
$
|
200,000
|
|
$25.0 Million Mortgage Note
|
|
Aon Center
|
|
5.70
|
%
|
|
5/1/2014
|
|
25,000
|
|
(10)
|
25,000
|
|
||
$350.0 Million Secured Pooled Facility
|
|
Nine Property Collateralized Pool
(2)
|
|
4.84
|
%
|
|
6/7/2014
|
|
350,000
|
|
|
350,000
|
|
||
$105.0 Million Fixed-Rate Loan
|
|
US Bancorp Center
|
|
5.29
|
%
|
|
5/11/2015
|
|
105,000
|
|
|
105,000
|
|
||
$125.0 Million Fixed-Rate Loan
|
|
Four Property Collateralized Pool
(3)
|
|
5.50
|
%
|
|
4/1/2016
|
|
125,000
|
|
|
125,000
|
|
||
$42.5 Million Fixed-Rate Loan
|
|
Las Colinas Corporate Center I & II
|
|
5.70
|
%
|
|
10/11/2016
|
|
42,525
|
|
|
42,525
|
|
||
$140.0 Million WDC Mortgage Notes
|
|
1201 & 1225 Eye Street
|
|
5.76
|
%
|
|
11/1/2017
|
|
140,000
|
|
|
140,000
|
|
||
Subtotal/Weighted Average
(4)
|
|
|
|
5.17
|
%
|
|
|
|
987,525
|
|
|
987,525
|
|
||
Unsecured (Variable and Fixed)
|
|
|
|
|
|
|
|
|
|
|
|||||
$300 Million Unsecured 2011 Term Loan
|
|
|
|
LIBOR + 1.45%
|
|
(5)
|
11/22/2016
|
|
300,000
|
|
|
300,000
|
|
||
$500 Million Unsecured Line of Credit
|
|
|
|
1.35
|
%
|
(6)
|
8/19/2016
|
(7)
|
366,000
|
|
|
129,000
|
|
||
$350 Million Senior Notes
|
|
|
|
3.40
|
%
|
(8)
|
6/1/2023
|
|
348,680
|
|
|
—
|
|
||
$300 Million Unsecured 2013 Term Loan
|
|
|
|
LIBOR + 1.20%
|
|
(9)
|
1/31/2019
|
|
—
|
|
|
—
|
|
||
Subtotal/Weighted Average
(4)
|
|
|
|
2.46
|
%
|
|
|
|
1,014,680
|
|
|
429,000
|
|
||
Total/ Weighted Average
(4)
|
|
|
|
3.80
|
%
|
|
|
|
$
|
2,002,205
|
|
|
$
|
1,416,525
|
|
(1)
|
All of Piedmont’s outstanding debt as of
December 31, 2013
and
2012
is interest-only debt.
|
(2)
|
Nine
property collateralized pool includes:1200 Crown Colony Drive in Quincy, Massachusetts, Braker Pointe III in Austin, Texas, 2 Gatehall Drive in Parsippany, New Jersey, the One and Two Independence Square buildings in Washington, DC, 2120 West End Avenue in Nashville, Tennessee, 400 Bridgewater Crossing in Bridgewater, New Jersey, 200 Bridgewater Crossing in Bridgewater, New Jersey, and Fairway Center II in Brea, California.
|
(3)
|
Four
property collateralized pool includes 1430 Enclave Parkway in Houston, Texas, Windy Point I and II in Schaumburg, Illinois, and 1055 East Colorado Boulevard in Pasadena, California.
|
(4)
|
Weighted average is based on the net book value of outstanding debt and interest rates in the table (or as footnoted) as of
December 31, 2013
.
|
(5)
|
The
$300 Million
Unsecured 2011 Term Loan has a stated variable rate; however, Piedmont entered into interest rate swap agreements which effectively fix, exclusive of changes to Piedmont's credit rating, the rate on this facility to
2.69%
through maturity.
|
(6)
|
Piedmont may select from multiple interest rate options with each draw, including the prime rate and various length LIBOR locks. All LIBOR selections are subject to an additional spread (
1.175%
as of
December 31, 2013
) over the selected rate based on Piedmont’s current credit rating. The outstanding balance as of
December 31, 2013
consists of LIBOR draws at an average rate of
0.17%
(subject to the additional spread mentioned above). Further, for the year ended
December 31, 2013
, Piedmont incurred net borrowings of approximately
$237.0 million
on its outstanding line of credit.
|
(7)
|
Piedmont may extend the term for up to
one
additional year (through
two
available
six
month extensions to a final extended maturity date of August 21, 2017) provided Piedmont is not then in default and upon payment of extension fees.
|
(8)
|
The
$350 Million
Senior Notes have a fixed coupon rate of
3.40%
, however, as a result of the issuance of the notes at a discount, Piedmont recognizes an effective interest rate on this debt issuance of
3.45%
.
|
(9)
|
On
January 30, 2014
, Piedmont drew the full commitment of the
$300 Million
Unsecured 2013 Term Loan. Additionally, Piedmont entered into
four
interest rate swap agreements with a total notional value of
$200 million
to effectively fix the interest rate for this portion of the debt at
2.79%
.
|
(10)
|
On
January 31, 2014
, Piedmont used the proceeds of the
$300 Million
Unsecured 2013 Term Loan mentioned above to fully repay the
$200 Million
Mortgage Note and the
$25 Million
Mortgage Note.
|
2014
|
$
|
575,000
|
|
|
2015
|
105,000
|
|
|
|
2016
|
833,525
|
|
(1)
|
|
2017
|
140,000
|
|
|
|
2018
|
—
|
|
|
|
Thereafter
|
350,000
|
|
|
|
Total
|
$
|
2,003,525
|
|
|
(1)
|
Includes the balance outstanding as of
December 31, 2013
of the
$500 Million
Unsecured Line of Credit. However, Piedmont may extend the term for up to
one
additional year (through
two
available
six
month extensions to a final extended maturity date of August 21, 2017) provided Piedmont is not then in default and upon payment of extension fees.
|
Entity
|
Piedmont’s
%
Ownership
of Entity
|
|
Related
Building
|
|
Consolidated/
Unconsolidated
|
|
Net Carrying Amount as of
December 31,
2013
|
|
Net Carrying Amount as of
December 31,
2012
|
|
Primary Beneficiary
Considerations
|
|||||
1201 Eye Street NW Associates, LLC
|
49.5
|
%
|
|
1201 Eye
Street
|
|
Consolidated
|
|
$
|
(5.3
|
)
|
|
$
|
(5.7
|
)
|
|
In accordance with the partnership’s governing documents, Piedmont is entitled to 100% of the cash flow of the entity and has sole discretion in directing the management and leasing activities of the building.
|
1225 Eye Street NW Associates, LLC
|
49.5
|
%
|
|
1225 Eye
Street
|
|
Consolidated
|
|
$
|
(0.9
|
)
|
|
$
|
(0.1
|
)
|
|
In accordance with the partnership’s governing documents, Piedmont is entitled to 100% of the cash flow of the entity and has sole discretion in directing the management and leasing activities of the building.
|
Piedmont 500 W. Monroe Fee, LLC
|
100
|
%
|
|
500 W. Monroe
|
|
Consolidated
|
|
$
|
228.3
|
|
|
$
|
194.0
|
|
|
The Omnibus Agreement with the previous owner includes equity participation rights for the previous owner, if certain financial returns are achieved; however, Piedmont has sole decision making authority and is entitled to the economic benefits of the property until such returns are met.
|
Suwanee Gateway One, LLC
|
100
|
%
|
|
Suwanee
Gateway
One
|
|
Consolidated
|
|
$
|
7.4
|
|
|
$
|
7.6
|
|
|
The fee agreement includes equity participation rights for the incentive manager, if certain returns on investment are achieved; however, Piedmont has sole decision making authority and is entitled to the economic benefits of the property until such returns are met.
|
Medici Atlanta, LLC
|
100
|
%
|
|
The Medici
|
|
Consolidated
|
|
$
|
14.4
|
|
|
$
|
13.7
|
|
|
The fee agreement includes equity participation rights for the incentive manager, if certain returns on investment are achieved; however, Piedmont has sole decision making authority and is entitled to the economic benefits of the property until such returns are met.
|
400 TownPark, LLC
|
100
|
%
|
|
400 TownPark
|
|
Consolidated
|
|
$
|
22.3
|
|
|
$
|
23.5
|
|
|
The fee agreement includes equity participation rights for the incentive manager, if certain returns on investment are achieved; however, Piedmont has sole decision making authority and is entitled to the economic benefits of the property until such returns are met.
|
Interest Rate Derivatives:
|
Notional Amount
(in millions)
|
|
Effective Date
|
|
Maturity Date
|
|
||
Interest rate swap
|
$
|
125
|
|
|
11/22/2011
|
|
11/22/2016
|
|
Interest rate swap
|
75
|
|
|
11/22/2011
|
|
11/22/2016
|
|
|
Interest rate swap
|
50
|
|
|
11/22/2011
|
|
11/22/2016
|
|
|
Interest rate swap
|
50
|
|
|
11/22/2011
|
|
11/22/2016
|
|
|
Forward starting interest rate swap
|
70
|
|
|
3/3/2014
|
|
3/3/2024
|
|
|
Forward starting interest rate swap
|
70
|
|
|
3/3/2014
|
|
3/3/2024
|
|
|
Forward starting interest rate swap
|
70
|
|
|
3/3/2014
|
|
3/3/2024
|
|
|
Forward starting interest rate swap
|
70
|
|
|
3/3/2014
|
|
3/3/2024
|
|
|
Total
|
$
|
580
|
|
|
|
|
|
|
Interest rate swaps classified as:
|
December 31, 2013
|
|
December 31, 2012
|
||||
Gross derivative assets
|
$
|
24,176
|
|
|
$
|
1,075
|
|
Gross derivative liabilities
|
(4,526
|
)
|
|
(8,235
|
)
|
||
Net derivative asset/(liability)
|
$
|
19,650
|
|
|
$
|
(7,160
|
)
|
Derivative in
Cash Flow Hedging
Relationships (Interest Rate Swaps and Caps)
|
2013
|
|
2012
|
|
2011
|
||||||
Amount of loss/(gain) recognized in OCI on derivatives
|
$
|
(24,312
|
)
|
|
$
|
7,656
|
|
|
$
|
3,064
|
|
Amount of previously recorded loss reclassified from accumulated OCI into interest expense
|
$
|
(3,126
|
)
|
|
$
|
(3,033
|
)
|
|
$
|
(1,218
|
)
|
|
2013
|
|
2012
|
|
|
||||||||||||||
Financial Instrument
|
Carrying Value
|
|
Estimated
Fair Value
|
|
Level Within Fair Value Hierarchy
|
|
Carrying Value
|
|
Estimated
Fair Value
|
|
Level Within Fair Value Hierarchy
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
(1)
|
$
|
6,973
|
|
|
$
|
6,973
|
|
|
Level 1
|
|
$
|
12,957
|
|
|
$
|
12,957
|
|
|
Level 1
|
Tenant receivables, net
(1)
|
$
|
31,145
|
|
|
$
|
31,145
|
|
|
Level 1
|
|
$
|
25,038
|
|
|
$
|
25,038
|
|
|
Level 1
|
Restricted cash and escrows
(1)
|
$
|
394
|
|
|
$
|
394
|
|
|
Level 1
|
|
$
|
334
|
|
|
$
|
334
|
|
|
Level 1
|
Interest rate swap asset
|
$
|
24,176
|
|
|
$
|
24,176
|
|
|
Level 2
|
|
$
|
1,075
|
|
|
$
|
1,075
|
|
|
Level 2
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Accounts payable and accrued expenses
(1)
|
$
|
16,680
|
|
|
$
|
16,680
|
|
|
Level 1
|
|
$
|
23,113
|
|
|
$
|
23,113
|
|
|
Level 1
|
Interest rate swap liability
|
$
|
4,526
|
|
|
$
|
4,526
|
|
|
Level 2
|
|
$
|
8,235
|
|
|
$
|
8,235
|
|
|
Level 2
|
Debt
|
$
|
2,002,205
|
|
|
$
|
2,004,870
|
|
|
Level 2
|
|
$
|
1,416,525
|
|
|
$
|
1,470,002
|
|
|
Level 2
|
(1)
|
For the periods presented, the carrying value approximates estimated fair value due to its short-term maturity.
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Impairment losses included in continuing operations:
|
|
|
|
|
|
|
||||||
Impairment losses recorded in real estate operating expenses:
|
|
|
|
|
|
|
||||||
11107 and 11109 Sunset Hills Road
|
|
$
|
1,242
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Impairment losses recorded in equity in loss of unconsolidated joint ventures:
|
|
|
|
|
|
|
||||||
Piedmont's Investment in Fund 13 and REIT JV (at Piedmont's approximate 72% ownership)
|
|
$
|
4,402
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Impairment losses recorded in discontinued operations:
|
|
|
|
|
|
|
||||||
1111 Durham Avenue
|
|
$
|
6,402
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Amount
|
|
|
Expiration of Letter of Credit
(1)
|
|
$
|
1,805,480
|
|
(2)
|
July 2014
|
$
|
9,033,164
|
|
(2)
|
July 2014
|
$
|
382,556
|
|
|
July 2014
|
(1)
|
All of Piedmont's outstanding letter of credit agreements contain an “evergreen” clause, which automatically renews for consecutive, one-year periods each anniversary, subject to certain limitations.
|
(2)
|
These letter of credit agreements were terminated in conjunction with repaying the notes payable secured by the Aon Center building in Chicago, Illinois on
February 3, 2014
.
|
|
2014
|
|
$
|
451
|
|
|
2015
|
|
451
|
|
|
|
2016
|
|
451
|
|
|
|
2017
|
|
451
|
|
|
|
2018
|
|
451
|
|
|
|
Thereafter
|
|
41,071
|
|
|
|
Total
|
|
$
|
43,326
|
|
|
Shares
|
|
Weighted-Average Grant Date Fair Value
|
|||
Unvested Deferred Stock Awards as of December 31, 2012
|
318,893
|
|
|
$
|
18.41
|
|
Deferred Stock Awards Granted During Fiscal Year 2013
|
161,257
|
|
|
$
|
19.47
|
|
Deferred Stock Awards Vested During Fiscal Year 2013
|
(209,284
|
)
|
|
$
|
18.91
|
|
Deferred Stock Awards Forfeited During Fiscal Year 2013
|
(5,727
|
)
|
|
$
|
18.62
|
|
Unvested Deferred Stock Awards as of December 31, 2013
|
265,139
|
|
|
$
|
18.65
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Weighted-Average Grant Date Fair Value for Shares Granted During the Year (per share)
|
$
|
19.47
|
|
|
$
|
17.53
|
|
|
$
|
19.03
|
|
Total Grant Date Fair Value of Shares Vested During the Year
|
$
|
3,957
|
|
|
$
|
5,331
|
|
|
$
|
5,405
|
|
Share-based Liabilities Paid
(1)
|
$
|
103
|
|
|
$
|
798
|
|
|
$
|
851
|
|
(1)
|
Amounts reflect the issuance of performance share awards during the period.
|
Date of grant
|
|
Type of Award
|
|
Net Shares
Granted
(1)
|
|
Grant
Date Fair
Value
|
|
Vesting Schedule
|
|
Unvested Shares as of
December 31, 2013
|
|
|||||
April 5, 2011
|
|
Annual Deferred Stock Award
|
|
116,116
|
|
|
$
|
19.40
|
|
|
Of the shares granted, 25% vested on the date of grant, and 25% of the shares vest on April 5, 2012, 2013, and 2014, respectively.
|
|
36,835
|
|
|
|
April 5, 2011
|
|
Fiscal Year 2011-2013 Performance Share Program
|
|
—
|
|
|
$
|
18.27
|
|
|
Shares awarded, if any, will vest immediately upon determination of award in 2014.
|
|
—
|
|
(2
|
)
|
April 4, 2012
|
|
Annual Deferred Stock Award
|
|
190,134
|
|
|
$
|
17.53
|
|
|
Of the shares granted, 25% vested on the date of grant, and 25% of the shares vest on April 4, 2013, 2014, and 2015, respectively.
|
|
110,184
|
|
|
|
April 4, 2012
|
|
Fiscal Year 2012-2014 Performance Share Program
|
|
—
|
|
|
$
|
17.42
|
|
|
Shares awarded, if any, will vest immediately upon determination of award in 2015.
|
|
—
|
|
(2
|
)
|
April 2, 2013
|
|
Annual Deferred Stock Award
|
|
146,679
|
|
|
$
|
19.47
|
|
|
Of the shares granted, 25% vested on the date of grant, and 25% of the shares vest on April 2, 2014, 2015, and 2016, respectively.
|
|
118,120
|
|
|
|
April 2, 2013
|
|
Fiscal Year 2013-2015 Performance Share Program
|
|
—
|
|
|
$
|
18.91
|
|
|
Shares awarded, if any, will vest immediately upon determination of award in 2016.
|
|
—
|
|
(2
|
)
|
Total
|
|
265,139
|
|
|
(1)
|
Amounts reflect the total grant to employees, net of shares surrendered upon vesting to satisfy required minimum tax withholding obligations through
December 31, 2013
.
|
(2)
|
Estimated based on Piedmont's cumulative total stockholder return ("TSR") for the respective performance period through
December 31, 2013
. As of December 31, 2013, Piedmont's TSR for each of these respective plans was below threshold. Such estimates are subject to change in future periods based on both Piedmont's and its peers' stock performance and dividends paid.
|
|
2013
|
|
2012
|
|
2011
|
|||
Weighted-average common shares—basic
|
165,013
|
|
|
170,312
|
|
|
172,765
|
|
Plus incremental weighted-average shares resulting from the assumed conversion of time-vested restricted stock awards
|
124
|
|
|
129
|
|
|
216
|
|
Weighted-average common shares—diluted
|
165,137
|
|
|
170,441
|
|
|
172,981
|
|
Building Sold
|
|
Location
|
|
Date of Sale
|
|
Gain/(Loss) on Sale
|
|
Net Sales Proceeds
|
||||
Eastpointe Corporate Center
|
|
Issaquah, Washington
|
|
July 1, 2011
|
|
$
|
12,152
|
|
|
$
|
31,704
|
|
5000 Corporate Court
|
|
Holtsville, New York
|
|
August 31, 2011
|
|
$
|
14,367
|
|
|
$
|
36,100
|
|
35 West Wacker Drive
|
(1)
|
Chicago, Illinois
|
|
December 15, 2011
|
|
$
|
96,138
|
|
|
$
|
223,981
|
|
Portland Portfolio
|
(2)
|
Beaverton, Oregon
|
|
March 19, 2012
|
|
$
|
17,823
|
|
|
$
|
43,832
|
|
26200 Enterprise Way
|
|
Lake Forest, California
|
|
May 31, 2012
|
|
$
|
10,013
|
|
|
$
|
24,412
|
|
110 & 112 Hidden Lake Circle Buildings
|
|
Duncan, South Carolina
|
|
September 21, 2012
|
|
$
|
(259
|
)
|
|
$
|
25,595
|
|
1111 Durham Avenue
|
|
South Plainfield, New Jersey
|
|
March 28, 2013
|
|
$
|
(9
|
)
|
|
$
|
3,752
|
|
1200 Enclave Parkway
|
|
Houston, Texas
|
|
May 1, 2013
|
|
$
|
16,246
|
|
|
$
|
45,552
|
|
350 Spectrum Loop
|
|
Colorado Springs, Colorado
|
|
November 1, 2013
|
|
$
|
7,959
|
|
|
$
|
29,676
|
|
8700 South Price Road
|
|
Tempe, Arizona
|
|
December 30, 2013
|
|
$
|
7,096
|
|
|
$
|
16,691
|
|
(1)
|
Piedmont sold its approximate
96.5%
ownership in the property. Transaction data above is presented at Piedmont's ownership percentage.
|
(2)
|
The Portland Portfolio consisted of
four
office properties known as the Deschutes building, the Rhein building, the Rogue building, and the Willamette building, as well as
18.19
acres of adjoining, undeveloped land.
|
|
Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Rental income
|
$
|
4,678
|
|
|
$
|
13,215
|
|
|
$
|
45,306
|
|
Tenant reimbursements
|
757
|
|
|
1,528
|
|
|
20,632
|
|
|||
|
5,435
|
|
|
14,743
|
|
|
65,938
|
|
|||
Expenses:
|
|
|
|
|
|
||||||
Property operating costs
|
1,900
|
|
|
5,216
|
|
|
26,243
|
|
|||
Depreciation
|
1,004
|
|
|
3,291
|
|
|
9,044
|
|
|||
Amortization
|
209
|
|
|
690
|
|
|
5,995
|
|
|||
General and administrative
|
2
|
|
|
45
|
|
|
(168
|
)
|
|||
|
3,115
|
|
|
9,242
|
|
|
41,114
|
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest expense
|
—
|
|
|
—
|
|
|
(5,931
|
)
|
|||
Interest income and other income/(expense)
|
26
|
|
|
—
|
|
|
(91
|
)
|
|||
Net casualty recoveries
|
17
|
|
|
—
|
|
|
—
|
|
|||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(453
|
)
|
|||
|
43
|
|
|
—
|
|
|
(6,475
|
)
|
|||
Operating income, excluding impairment loss and gain on sale of real estate assets
|
2,363
|
|
|
5,501
|
|
|
18,349
|
|
|||
Impairment loss
|
(6,402
|
)
|
|
—
|
|
|
—
|
|
|||
Gain on sale of real estate assets
|
31,292
|
|
|
27,577
|
|
|
122,657
|
|
|||
Income from discontinued operations
|
$
|
27,253
|
|
|
$
|
33,078
|
|
|
$
|
141,006
|
|
|
2013
|
|
2012
|
|
2011
|
||||||
Accrued capital expenditures and deferred lease costs
|
$
|
12,460
|
|
|
$
|
12,598
|
|
|
$
|
8,218
|
|
Change in accrued offering costs related to issuance of common stock
|
$
|
—
|
|
|
$
|
(567
|
)
|
|
$
|
227
|
|
Net assets assumed upon consolidation of variable interest entity, net of notes receivable previously recorded
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
188,283
|
|
Liabilities assumed upon consolidation of variable interest entity
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
191,814
|
|
Change in accrued share repurchases as part of an announced plan
|
$
|
1,718
|
|
|
$
|
287
|
|
|
$
|
—
|
|
|
2013
|
|
2012
|
|
2011
|
|
||||||
GAAP basis financial statement net income
|
$
|
98,728
|
|
|
$
|
93,204
|
|
|
$
|
225,041
|
|
|
Increase (decrease) in net income resulting from:
|
|
|
|
|
|
|
||||||
Depreciation and amortization expense for financial reporting purposes in excess of amounts for income tax purposes
|
42,374
|
|
|
35,125
|
|
|
47,346
|
|
|
|||
Rental income accrued for income tax purposes less than amounts for financial reporting purposes
|
(25,964
|
)
|
|
(10,422
|
)
|
|
(9,380
|
)
|
|
|||
Net amortization of above/below-market lease intangibles for financial reporting purposes in excess of amounts for income tax purposes
|
(4,701
|
)
|
|
(5,324
|
)
|
|
(6,605
|
)
|
|
|||
Gain on disposal of property for financial reporting purposes in excess of amounts for income tax purposes
|
(35,153
|
)
|
|
(7,967
|
)
|
|
(66,410
|
)
|
|
|||
Taxable income of Piedmont Washington Properties, Inc., in excess of amount for financial reporting purposes
|
—
|
|
|
2,662
|
|
|
4,515
|
|
|
|||
Other expenses for financial reporting purposes in excess of amounts for income tax purposes
|
9,045
|
|
|
14,361
|
|
|
(2,072
|
)
|
|
|||
Income tax basis net income, prior to dividends paid deduction
|
$
|
84,329
|
|
|
$
|
121,639
|
|
|
$
|
192,435
|
|
|
|
2013
|
|
2012
|
|
2011
|
|||
Ordinary income
|
64
|
%
|
|
73
|
%
|
|
61
|
%
|
Return of capital
|
36
|
%
|
|
11
|
%
|
|
12
|
%
|
Capital gains
|
—
|
%
|
|
16
|
%
|
|
27
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
2013
|
|
||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
||||||||
Revenues
|
$
|
133,293
|
|
|
$
|
133,713
|
|
|
$
|
144,631
|
|
|
$
|
142,868
|
|
|
Real estate operating income
|
$
|
37,781
|
|
|
$
|
32,863
|
|
|
$
|
35,563
|
|
|
$
|
33,981
|
|
|
Income from continuing operations
|
$
|
20,365
|
|
|
$
|
18,279
|
|
|
$
|
18,688
|
|
|
$
|
14,158
|
|
|
Income/(loss) from discontinued operations
|
$
|
(5,710
|
)
|
|
$
|
17,083
|
|
|
$
|
412
|
|
|
$
|
15,468
|
|
|
Net income attributable to Piedmont
|
$
|
14,651
|
|
|
$
|
35,358
|
|
|
$
|
19,096
|
|
|
$
|
29,623
|
|
|
Basic and diluted earnings per share
|
$
|
0.09
|
|
|
$
|
0.21
|
|
|
$
|
0.12
|
|
|
$
|
0.18
|
|
|
Dividends per share
|
$
|
0.20
|
|
|
$
|
0.20
|
|
|
$
|
0.20
|
|
|
$
|
0.20
|
|
|
|
2012
|
|
||||||||||||||
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
||||||||
Revenues
|
$
|
129,960
|
|
|
$
|
130,556
|
|
|
$
|
132,149
|
|
|
$
|
132,379
|
|
|
Real estate operating income
|
$
|
33,978
|
|
|
$
|
34,991
|
|
|
$
|
33,263
|
|
|
$
|
33,846
|
|
|
Income from continuing operations
|
$
|
17,707
|
|
|
$
|
19,579
|
|
|
$
|
10,222
|
|
|
$
|
12,633
|
|
|
Income from discontinued operations
|
$
|
19,524
|
|
|
$
|
11,133
|
|
|
$
|
612
|
|
|
$
|
1,809
|
|
|
Net income attributable to Piedmont
|
$
|
37,228
|
|
|
$
|
30,708
|
|
|
$
|
10,830
|
|
|
$
|
14,438
|
|
|
Basic and diluted earnings per share
|
$
|
0.22
|
|
|
$
|
0.18
|
|
|
$
|
0.06
|
|
|
$
|
0.09
|
|
|
Dividends per share
|
$
|
0.20
|
|
|
$
|
0.20
|
|
|
$
|
0.20
|
|
|
$
|
0.20
|
|
|
Condensed Consolidated Balance Sheets
|
|||||||||||||||||||
As of December 31, 2013
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate assets, at cost:
|
|
|
|
|
|
|
|
|
|
||||||||||
Land
|
$
|
88,054
|
|
|
$
|
—
|
|
|
$
|
600,707
|
|
|
$
|
—
|
|
|
$
|
688,761
|
|
Buildings and improvements, less accumulated depreciation
|
477,712
|
|
|
—
|
|
|
2,687,163
|
|
|
(300
|
)
|
|
3,164,575
|
|
|||||
Intangible lease assets, less accumulated amortization
|
2,356
|
|
|
—
|
|
|
72,021
|
|
|
—
|
|
|
74,377
|
|
|||||
Construction in progress
|
4,627
|
|
|
—
|
|
|
19,643
|
|
|
—
|
|
|
24,270
|
|
|||||
Total real estate assets
|
572,749
|
|
|
—
|
|
|
3,379,534
|
|
|
(300
|
)
|
|
3,951,983
|
|
|||||
Investments in and amounts due from unconsolidated joint ventures
|
14,388
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,388
|
|
|||||
Cash and cash equivalents
|
3,352
|
|
|
150
|
|
|
3,471
|
|
|
—
|
|
|
6,973
|
|
|||||
Tenant and straight-line receivables, net
|
36,142
|
|
|
—
|
|
|
134,409
|
|
|
—
|
|
|
170,551
|
|
|||||
Advances to affiliates
|
5,312,384
|
|
|
1,288,547
|
|
|
—
|
|
|
(6,600,931
|
)
|
|
—
|
|
|||||
Investment in subsidiary
|
—
|
|
|
4,003,806
|
|
|
197
|
|
|
(4,004,003
|
)
|
|
—
|
|
|||||
Notes receivable
|
160,000
|
|
|
2,000
|
|
|
23,890
|
|
|
(185,890
|
)
|
|
—
|
|
|||||
Prepaid expenses, restricted cash, escrows, and other assets
|
5,319
|
|
|
44
|
|
|
20,779
|
|
|
(977
|
)
|
|
25,165
|
|
|||||
Goodwill
|
180,097
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
180,097
|
|
|||||
Interest rate swap
|
24,176
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,176
|
|
|||||
Deferred financing costs, net
|
7,764
|
|
|
—
|
|
|
995
|
|
|
—
|
|
|
8,759
|
|
|||||
Deferred lease costs, net
|
34,413
|
|
|
—
|
|
|
249,583
|
|
|
—
|
|
|
283,996
|
|
|||||
Total assets
|
$
|
6,350,784
|
|
|
$
|
5,294,547
|
|
|
$
|
3,812,858
|
|
|
$
|
(10,792,101
|
)
|
|
$
|
4,666,088
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt
|
$
|
1,038,570
|
|
|
$
|
—
|
|
|
$
|
1,149,525
|
|
|
$
|
(185,890
|
)
|
|
$
|
2,002,205
|
|
Accounts payable, accrued expenses, and accrued capital expenditures
|
13,824
|
|
|
2,376
|
|
|
113,595
|
|
|
(977
|
)
|
|
128,818
|
|
|||||
Advances from affiliates
|
312,881
|
|
|
4,863,672
|
|
|
1,467,334
|
|
|
(6,643,887
|
)
|
|
—
|
|
|||||
Deferred income
|
5,086
|
|
|
—
|
|
|
17,181
|
|
|
—
|
|
|
22,267
|
|
|||||
Intangible lease liabilities, net
|
—
|
|
|
—
|
|
|
47,113
|
|
|
—
|
|
|
47,113
|
|
|||||
Interest rate swaps
|
4,526
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,526
|
|
|||||
Total liabilities
|
1,374,887
|
|
|
4,866,048
|
|
|
2,794,748
|
|
|
(6,830,754
|
)
|
|
2,204,929
|
|
|||||
Stockholders’ Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
—
|
|
|
1,575
|
|
|
—
|
|
|
—
|
|
|
1,575
|
|
|||||
Additional paid-in capital
|
4,003,806
|
|
|
3,668,906
|
|
|
197
|
|
|
(4,004,003
|
)
|
|
3,668,906
|
|
|||||
Cumulative distributions in excess of earnings
|
951,813
|
|
|
(3,241,982
|
)
|
|
1,016,304
|
|
|
42,656
|
|
|
(1,231,209
|
)
|
|||||
Other comprehensive loss
|
20,278
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,278
|
|
|||||
Piedmont stockholders’ equity
|
4,975,897
|
|
|
428,499
|
|
|
1,016,501
|
|
|
(3,961,347
|
)
|
|
2,459,550
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
1,609
|
|
|
—
|
|
|
1,609
|
|
|||||
Total stockholders’ equity
|
4,975,897
|
|
|
428,499
|
|
|
1,018,110
|
|
|
(3,961,347
|
)
|
|
2,461,159
|
|
|||||
Total liabilities and stockholders’ equity
|
$
|
6,350,784
|
|
|
$
|
5,294,547
|
|
|
$
|
3,812,858
|
|
|
$
|
(10,792,101
|
)
|
|
$
|
4,666,088
|
|
Condensed Consolidated Balance Sheets
|
|||||||||||||||||||
As of December 31, 2012
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate assets, at cost:
|
|
|
|
|
|
|
|
|
|
||||||||||
Land
|
$
|
93,967
|
|
|
$
|
—
|
|
|
$
|
535,569
|
|
|
$
|
—
|
|
|
$
|
629,536
|
|
Buildings and improvements, less accumulated depreciation
|
528,548
|
|
|
—
|
|
|
2,379,530
|
|
|
—
|
|
|
2,908,078
|
|
|||||
Intangible lease assets, less accumulated amortization
|
3,266
|
|
|
—
|
|
|
51,479
|
|
|
—
|
|
|
54,745
|
|
|||||
Construction in progress
|
1,056
|
|
|
—
|
|
|
19,317
|
|
|
—
|
|
|
20,373
|
|
|||||
Total real estate assets
|
626,837
|
|
|
—
|
|
|
2,985,895
|
|
|
—
|
|
|
3,612,732
|
|
|||||
Investments in and amounts due from unconsolidated joint ventures
|
37,689
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37,689
|
|
|||||
Cash and cash equivalents
|
62,371
|
|
|
239
|
|
|
(49,653
|
)
|
|
—
|
|
|
12,957
|
|
|||||
Tenant and straight-line rent receivables, net
|
34,288
|
|
|
—
|
|
|
113,049
|
|
|
—
|
|
|
147,337
|
|
|||||
Advances to affiliates
|
4,623,173
|
|
|
1,300,158
|
|
|
—
|
|
|
(5,923,331
|
)
|
|
—
|
|
|||||
Investment in subsidiary
|
—
|
|
|
4,068,844
|
|
|
200
|
|
|
(4,069,044
|
)
|
|
—
|
|
|||||
Notes receivable
|
160,000
|
|
|
2,500
|
|
|
23,890
|
|
|
(186,390
|
)
|
|
—
|
|
|||||
Prepaid expenses, restricted cash, escrows, and other assets
|
5,149
|
|
|
14
|
|
|
17,402
|
|
|
(948
|
)
|
|
21,617
|
|
|||||
Goodwill
|
180,097
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
180,097
|
|
|||||
Interest rate swap
|
1,075
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,075
|
|
|||||
Deferred financing costs, net
|
4,292
|
|
|
—
|
|
|
2,162
|
|
|
—
|
|
|
6,454
|
|
|||||
Deferred lease costs, net
|
30,426
|
|
|
—
|
|
|
204,491
|
|
|
—
|
|
|
234,917
|
|
|||||
Total assets
|
$
|
5,765,397
|
|
|
$
|
5,371,755
|
|
|
$
|
3,297,436
|
|
|
$
|
(10,179,713
|
)
|
|
$
|
4,254,875
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt
|
$
|
452,890
|
|
|
$
|
—
|
|
|
$
|
1,150,025
|
|
|
$
|
(186,390
|
)
|
|
$
|
1,416,525
|
|
Accounts payable, accrued expenses, and accrued capital expenditures
|
20,443
|
|
|
645
|
|
|
107,123
|
|
|
(948
|
)
|
|
127,263
|
|
|||||
Advances from affiliates
|
274,159
|
|
|
4,636,936
|
|
|
1,044,446
|
|
|
(5,955,541
|
)
|
|
—
|
|
|||||
Deferred income
|
5,991
|
|
|
—
|
|
|
15,561
|
|
|
—
|
|
|
21,552
|
|
|||||
Intangible lease liabilities, net
|
24
|
|
|
—
|
|
|
40,781
|
|
|
—
|
|
|
40,805
|
|
|||||
Interest rate swaps
|
8,235
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,235
|
|
|||||
Total liabilities
|
761,742
|
|
|
4,637,581
|
|
|
2,357,936
|
|
|
(6,142,879
|
)
|
|
1,614,380
|
|
|||||
Stockholders’ Equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
—
|
|
|
1,676
|
|
|
—
|
|
|
—
|
|
|
1,676
|
|
|||||
Additional paid-in capital
|
4,068,844
|
|
|
3,667,051
|
|
|
200
|
|
|
(4,069,044
|
)
|
|
3,667,051
|
|
|||||
Cumulative distributions in excess of earnings
|
941,971
|
|
|
(2,934,553
|
)
|
|
937,691
|
|
|
32,210
|
|
|
(1,022,681
|
)
|
|||||
Other comprehensive loss
|
(7,160
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,160
|
)
|
|||||
Piedmont stockholders’ equity
|
5,003,655
|
|
|
734,174
|
|
|
937,891
|
|
|
(4,036,834
|
)
|
|
2,638,886
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
1,609
|
|
|
—
|
|
|
1,609
|
|
|||||
Total stockholders’ equity
|
5,003,655
|
|
|
734,174
|
|
|
939,500
|
|
|
(4,036,834
|
)
|
|
2,640,495
|
|
|||||
Total liabilities and stockholders’ equity
|
$
|
5,765,397
|
|
|
$
|
5,371,755
|
|
|
$
|
3,297,436
|
|
|
$
|
(10,179,713
|
)
|
|
$
|
4,254,875
|
|
Condensed Consolidated Statements of Income
|
|||||||||||||||||||
For the year ended December 31, 2013
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental income
|
$
|
77,200
|
|
|
$
|
—
|
|
|
$
|
375,769
|
|
|
$
|
(5,282
|
)
|
|
$
|
447,687
|
|
Tenant reimbursements
|
16,526
|
|
|
—
|
|
|
88,461
|
|
|
(420
|
)
|
|
104,567
|
|
|||||
Property management fee revenue
|
—
|
|
|
—
|
|
|
15,360
|
|
|
(13,109
|
)
|
|
2,251
|
|
|||||
|
93,726
|
|
|
—
|
|
|
479,590
|
|
|
(18,811
|
)
|
|
554,505
|
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property operating costs
|
41,833
|
|
|
—
|
|
|
200,472
|
|
|
(19,326
|
)
|
|
222,979
|
|
|||||
Depreciation
|
23,857
|
|
|
—
|
|
|
98,705
|
|
|
—
|
|
|
122,562
|
|
|||||
Amortization
|
5,297
|
|
|
—
|
|
|
40,354
|
|
|
—
|
|
|
45,651
|
|
|||||
Impairment loss
|
1,242
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,242
|
|
|||||
General and administrative
|
21,011
|
|
|
337
|
|
|
24,927
|
|
|
(24,392
|
)
|
|
21,883
|
|
|||||
|
93,240
|
|
|
337
|
|
|
364,458
|
|
|
(43,718
|
)
|
|
414,317
|
|
|||||
Real estate operating income/(loss)
|
486
|
|
|
(337
|
)
|
|
115,132
|
|
|
24,907
|
|
|
140,188
|
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
(22,242
|
)
|
|
—
|
|
|
(63,900
|
)
|
|
12,559
|
|
|
(73,583
|
)
|
|||||
Interest income and other income/(expense)
|
10,630
|
|
|
164
|
|
|
(587
|
)
|
|
(12,559
|
)
|
|
(2,352
|
)
|
|||||
Litigation settlement recovery
|
1,250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,250
|
|
|||||
Net casualty recoveries/(loss)
|
(567
|
)
|
|
—
|
|
|
11,128
|
|
|
—
|
|
|
10,561
|
|
|||||
Equity in loss of unconsolidated joint ventures
|
(3,676
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,676
|
)
|
|||||
Loss on consolidation
|
(898
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(898
|
)
|
|||||
|
(15,503
|
)
|
|
164
|
|
|
(53,359
|
)
|
|
—
|
|
|
(68,698
|
)
|
|||||
Income/(loss) from continuing operations
|
(15,017
|
)
|
|
(173
|
)
|
|
61,773
|
|
|
24,907
|
|
|
71,490
|
|
|||||
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income, excluding impairment loss
|
1,755
|
|
|
—
|
|
|
608
|
|
|
—
|
|
|
2,363
|
|
|||||
Impairment loss
|
(6,402
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,402
|
)
|
|||||
Gain on sale of real estate assets
|
15,046
|
|
|
—
|
|
|
16,246
|
|
|
—
|
|
|
31,292
|
|
|||||
Income from discontinued operations
|
10,399
|
|
|
—
|
|
|
16,854
|
|
|
—
|
|
|
27,253
|
|
|||||
Net income/(loss)
|
(4,618
|
)
|
|
(173
|
)
|
|
78,627
|
|
|
24,907
|
|
|
98,743
|
|
|||||
Less: Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
(15
|
)
|
|||||
Net income/(loss) attributable to Piedmont
|
$
|
(4,618
|
)
|
|
$
|
(173
|
)
|
|
$
|
78,612
|
|
|
$
|
24,907
|
|
|
$
|
98,728
|
|
Condensed Consolidated Statements of Income
|
|||||||||||||||||||
For the year ended December 31, 2012
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental income
|
$
|
72,072
|
|
|
$
|
—
|
|
|
$
|
348,713
|
|
|
$
|
(4,813
|
)
|
|
$
|
415,972
|
|
Tenant reimbursements
|
17,100
|
|
|
—
|
|
|
89,937
|
|
|
(283
|
)
|
|
106,754
|
|
|||||
Property management fee revenue
|
—
|
|
|
—
|
|
|
14,350
|
|
|
(12,032
|
)
|
|
2,318
|
|
|||||
|
89,172
|
|
|
—
|
|
|
453,000
|
|
|
(17,128
|
)
|
|
525,044
|
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property operating costs
|
36,486
|
|
|
—
|
|
|
189,665
|
|
|
(17,871
|
)
|
|
208,280
|
|
|||||
Depreciation
|
23,456
|
|
|
—
|
|
|
86,903
|
|
|
—
|
|
|
110,359
|
|
|||||
Amortization
|
5,524
|
|
|
—
|
|
|
44,038
|
|
|
—
|
|
|
49,562
|
|
|||||
General and administrative
|
19,804
|
|
|
294
|
|
|
23,574
|
|
|
(22,907
|
)
|
|
20,765
|
|
|||||
|
85,270
|
|
|
294
|
|
|
344,180
|
|
|
(40,778
|
)
|
|
388,966
|
|
|||||
Real estate operating income/(loss)
|
3,902
|
|
|
(294
|
)
|
|
108,820
|
|
|
23,650
|
|
|
136,078
|
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
(12,530
|
)
|
|
—
|
|
|
(65,001
|
)
|
|
12,508
|
|
|
(65,023
|
)
|
|||||
Interest income and other income/(expense)
|
12,226
|
|
|
15
|
|
|
1,100
|
|
|
(12,508
|
)
|
|
833
|
|
|||||
Litigation settlement expense
|
(7,500
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,500
|
)
|
|||||
Net casualty recoveries/(loss)
|
(5,195
|
)
|
|
—
|
|
|
25
|
|
|
—
|
|
|
(5,170
|
)
|
|||||
Equity in income of unconsolidated joint ventures
|
923
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
923
|
|
|||||
|
(12,076
|
)
|
|
15
|
|
|
(63,876
|
)
|
|
—
|
|
|
(75,937
|
)
|
|||||
Income/(loss) from continuing operations
|
(8,174
|
)
|
|
(279
|
)
|
|
44,944
|
|
|
23,650
|
|
|
60,141
|
|
|||||
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income
|
5,220
|
|
|
—
|
|
|
281
|
|
|
—
|
|
|
5,501
|
|
|||||
Gain on sale of real estate assets
|
27,577
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,577
|
|
|||||
Income from discontinued operations
|
32,797
|
|
|
—
|
|
|
281
|
|
|
—
|
|
|
33,078
|
|
|||||
Net income/(loss)
|
24,623
|
|
|
(279
|
)
|
|
45,225
|
|
|
23,650
|
|
|
93,219
|
|
|||||
Less: Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
(15
|
)
|
|||||
Net income/(loss) attributable to Piedmont
|
$
|
24,623
|
|
|
$
|
(279
|
)
|
|
$
|
45,210
|
|
|
$
|
23,650
|
|
|
$
|
93,204
|
|
Condensed Consolidated Statements of Income
|
|||||||||||||||||||
For the year ended December 31, 2011
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental income
|
$
|
67,669
|
|
|
$
|
—
|
|
|
$
|
343,492
|
|
|
$
|
(1,450
|
)
|
|
$
|
409,711
|
|
Tenant reimbursements
|
18,539
|
|
|
—
|
|
|
95,313
|
|
|
(39
|
)
|
|
113,813
|
|
|||||
Property management fee revenue
|
—
|
|
|
—
|
|
|
14,474
|
|
|
(12,890
|
)
|
|
1,584
|
|
|||||
|
86,208
|
|
|
—
|
|
|
453,279
|
|
|
(14,379
|
)
|
|
525,108
|
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Property operating costs
|
40,311
|
|
|
—
|
|
|
177,566
|
|
|
(15,346
|
)
|
|
202,531
|
|
|||||
Depreciation
|
21,148
|
|
|
—
|
|
|
79,538
|
|
|
—
|
|
|
100,686
|
|
|||||
Amortization
|
4,860
|
|
|
—
|
|
|
49,148
|
|
|
—
|
|
|
54,008
|
|
|||||
General and administrative
|
25,029
|
|
|
(50
|
)
|
|
24,570
|
|
|
(24,477
|
)
|
|
25,072
|
|
|||||
|
91,348
|
|
|
(50
|
)
|
|
330,822
|
|
|
(39,823
|
)
|
|
382,297
|
|
|||||
Real estate operating income/(loss)
|
(5,140
|
)
|
|
50
|
|
|
122,457
|
|
|
25,444
|
|
|
142,811
|
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
(8,991
|
)
|
|
—
|
|
|
(70,526
|
)
|
|
13,700
|
|
|
(65,817
|
)
|
|||||
Interest income and other income/(expense)
|
11,975
|
|
|
—
|
|
|
4,591
|
|
|
(13,700
|
)
|
|
2,866
|
|
|||||
Equity in income of unconsolidated joint ventures
|
1,619
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,619
|
|
|||||
Gain on consolidation
|
—
|
|
|
—
|
|
|
1,532
|
|
|
—
|
|
|
1,532
|
|
|||||
Gain on extinguishment of debt
|
—
|
|
|
—
|
|
|
1,039
|
|
|
—
|
|
|
1,039
|
|
|||||
|
4,603
|
|
|
—
|
|
|
(63,364
|
)
|
|
—
|
|
|
(58,761
|
)
|
|||||
Income/(loss) from continuing operations
|
(537
|
)
|
|
50
|
|
|
59,093
|
|
|
25,444
|
|
|
84,050
|
|
|||||
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income
|
6,842
|
|
|
—
|
|
|
11,507
|
|
|
—
|
|
|
18,349
|
|
|||||
Gain on sale of real estate assets
|
12,152
|
|
|
—
|
|
|
110,505
|
|
|
—
|
|
|
122,657
|
|
|||||
Income from discontinued operations
|
18,994
|
|
|
—
|
|
|
122,012
|
|
|
—
|
|
|
141,006
|
|
|||||
Net income
|
18,457
|
|
|
50
|
|
|
181,105
|
|
|
25,444
|
|
|
225,056
|
|
|||||
Less: Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
(15
|
)
|
|||||
Net income attributable to Piedmont
|
$
|
18,457
|
|
|
$
|
50
|
|
|
$
|
181,090
|
|
|
$
|
25,444
|
|
|
$
|
225,041
|
|
Condensed Consolidated Statements of Cash Flows
|
|||||||||||||||||||
For the year ended December 31, 2013
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net Cash Provided by Operating Activities
|
$
|
15,327
|
|
|
$
|
1,853
|
|
|
$
|
172,992
|
|
|
$
|
24,907
|
|
|
$
|
215,079
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Acquisition of real estate assets, related intangibles and capitalized expenditures, net of accruals
|
(10,382
|
)
|
|
—
|
|
|
(532,088
|
)
|
|
300
|
|
|
(542,170
|
)
|
|||||
Intercompany note receivable
|
—
|
|
|
500
|
|
|
—
|
|
|
(500
|
)
|
|
—
|
|
|||||
Acquisition of unconsolidated joint ventures, net of cash assumed
|
18,045
|
|
|
—
|
|
|
(32,287
|
)
|
|
—
|
|
|
(14,242
|
)
|
|||||
Net sales proceeds from wholly-owned properties
|
50,118
|
|
|
—
|
|
|
45,553
|
|
|
—
|
|
|
95,671
|
|
|||||
Investments in unconsolidated joint ventures
|
(793
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(793
|
)
|
|||||
Deferred lease costs paid
|
(10,980
|
)
|
|
—
|
|
|
(23,318
|
)
|
|
—
|
|
|
(34,298
|
)
|
|||||
Net cash provided by/(used in) investing activities
|
46,008
|
|
|
500
|
|
|
(542,140
|
)
|
|
(200
|
)
|
|
(495,832
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deferred financing costs paid
|
(4,892
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,892
|
)
|
|||||
Proceeds from debt
|
1,085,604
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,085,604
|
|
|||||
Repayments of debt
|
(500,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(500,000
|
)
|
|||||
Intercompany note payable
|
—
|
|
|
—
|
|
|
(500
|
)
|
|
500
|
|
|
—
|
|
|||||
Net costs of issuance of common stock
|
—
|
|
|
(91
|
)
|
|
—
|
|
|
—
|
|
|
(91
|
)
|
|||||
Repurchases of common stock as part of announced plan
|
—
|
|
|
(173,551
|
)
|
|
—
|
|
|
—
|
|
|
(173,551
|
)
|
|||||
Intercompany distributions
|
(701,066
|
)
|
|
303,486
|
|
|
422,787
|
|
|
(25,207
|
)
|
|
—
|
|
|||||
Dividends paid and discount on dividend reinvestments
|
—
|
|
|
(132,286
|
)
|
|
(15
|
)
|
|
—
|
|
|
(132,301
|
)
|
|||||
Net cash provided by/(used in) financing activities
|
(120,354
|
)
|
|
(2,442
|
)
|
|
422,272
|
|
|
(24,707
|
)
|
|
274,769
|
|
|||||
Net increase/(decrease) in cash and cash equivalents
|
(59,019
|
)
|
|
(89
|
)
|
|
53,124
|
|
|
—
|
|
|
(5,984
|
)
|
|||||
Cash and cash equivalents, beginning of year
|
62,371
|
|
|
239
|
|
|
(49,653
|
)
|
|
—
|
|
|
12,957
|
|
|||||
Cash and cash equivalents, end of year
|
$
|
3,352
|
|
|
$
|
150
|
|
|
$
|
3,471
|
|
|
$
|
—
|
|
|
$
|
6,973
|
|
Condensed Consolidated Statements of Cash Flows
|
|||||||||||||||||||
For the year ended December 31, 2012
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net Cash Provided by Operating Activities
|
$
|
32,260
|
|
|
$
|
2,215
|
|
|
$
|
162,800
|
|
|
$
|
23,650
|
|
|
$
|
220,925
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Acquisition of real estate assets, related intangibles and capitalized expenditures, net of accruals
|
(20,763
|
)
|
|
—
|
|
|
(87,724
|
)
|
|
—
|
|
|
(108,487
|
)
|
|||||
Intercompany note receivable
|
—
|
|
|
(2,500
|
)
|
|
—
|
|
|
2,500
|
|
|
—
|
|
|||||
Net sales proceeds from wholly-owned properties
|
93,839
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
93,839
|
|
|||||
Investments in unconsolidated joint ventures
|
(136
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(136
|
)
|
|||||
Deferred lease costs paid
|
(4,164
|
)
|
|
—
|
|
|
(44,528
|
)
|
|
—
|
|
|
(48,692
|
)
|
|||||
Net cash provided by/(used in) investing activities
|
68,776
|
|
|
(2,500
|
)
|
|
(132,252
|
)
|
|
2,500
|
|
|
(63,476
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deferred financing costs paid
|
(3,125
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,125
|
)
|
|||||
Proceeds from debt
|
409,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
409,000
|
|
|||||
Repayments of debt
|
(280,000
|
)
|
|
—
|
|
|
(185,000
|
)
|
|
—
|
|
|
(465,000
|
)
|
|||||
Intercompany note payable
|
—
|
|
|
—
|
|
|
2,500
|
|
|
(2,500
|
)
|
|
—
|
|
|||||
Net costs of issuance of common stock
|
—
|
|
|
(229
|
)
|
|
—
|
|
|
—
|
|
|
(229
|
)
|
|||||
Repurchases of common stock as part of announced plan
|
—
|
|
|
(88,450
|
)
|
|
—
|
|
|
—
|
|
|
(88,450
|
)
|
|||||
Intercompany distributions
|
(331,460
|
)
|
|
225,427
|
|
|
129,683
|
|
|
(23,650
|
)
|
|
—
|
|
|||||
Dividends paid and discount on dividend reinvestments
|
—
|
|
|
(136,363
|
)
|
|
(15
|
)
|
|
—
|
|
|
(136,378
|
)
|
|||||
Net cash provided by/(used in) financing activities
|
(205,585
|
)
|
|
385
|
|
|
(52,832
|
)
|
|
(26,150
|
)
|
|
(284,182
|
)
|
|||||
Net increase/(decrease) in cash and cash equivalents
|
(104,549
|
)
|
|
100
|
|
|
(22,284
|
)
|
|
—
|
|
|
(126,733
|
)
|
|||||
Cash and cash equivalents, beginning of year
|
166,920
|
|
|
139
|
|
|
(27,369
|
)
|
|
—
|
|
|
139,690
|
|
|||||
Cash and cash equivalents, end of year
|
$
|
62,371
|
|
|
$
|
239
|
|
|
$
|
(49,653
|
)
|
|
$
|
—
|
|
|
$
|
12,957
|
|
Condensed Consolidated Statements of Cash Flows
|
|||||||||||||||||||
For the year ended December 31, 2011
|
|||||||||||||||||||
(in thousands)
|
Issuer
|
|
Guarantor
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net Cash Provided by Operating Activities
|
$
|
34,362
|
|
|
$
|
2,375
|
|
|
$
|
204,913
|
|
|
$
|
25,445
|
|
|
$
|
267,095
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Acquisition of real estate assets, related intangibles and capitalized expenditures, net of accruals
|
(15,856
|
)
|
|
—
|
|
|
(199,753
|
)
|
|
—
|
|
|
(215,609
|
)
|
|||||
Intercompany note receivable
|
—
|
|
|
—
|
|
|
53,000
|
|
|
(53,000
|
)
|
|
—
|
|
|||||
Cash assumed upon consolidation of variable interest entity
|
—
|
|
|
—
|
|
|
5,063
|
|
|
—
|
|
|
5,063
|
|
|||||
Net sales proceeds from wholly-owned properties and consolidated joint venture
|
31,704
|
|
|
—
|
|
|
260,081
|
|
|
—
|
|
|
291,785
|
|
|||||
Net sales proceeds received from unconsolidated joint ventures
|
3,036
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,036
|
|
|||||
Investments in unconsolidated joint ventures
|
(151
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(151
|
)
|
|||||
Liquidation of noncontrolling interest upon sale of consolidated joint venture
|
—
|
|
|
—
|
|
|
(95
|
)
|
|
—
|
|
|
(95
|
)
|
|||||
Deferred lease costs paid
|
(10,695
|
)
|
|
—
|
|
|
(36,354
|
)
|
|
—
|
|
|
(47,049
|
)
|
|||||
Net cash provided by/(used in) investing activities
|
8,038
|
|
|
—
|
|
|
81,942
|
|
|
(53,000
|
)
|
|
36,980
|
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deferred financing costs paid
|
(2,717
|
)
|
|
—
|
|
|
(650
|
)
|
|
—
|
|
|
(3,367
|
)
|
|||||
Proceeds from debt
|
829,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
829,000
|
|
|||||
Repayments of debt
|
(779,000
|
)
|
|
—
|
|
|
(43,875
|
)
|
|
—
|
|
|
(822,875
|
)
|
|||||
Intercompany note payable
|
(53,000
|
)
|
|
—
|
|
|
—
|
|
|
53,000
|
|
|
—
|
|
|||||
Net costs of issuance of common stock
|
—
|
|
|
(252
|
)
|
|
—
|
|
|
—
|
|
|
(252
|
)
|
|||||
Repurchases of common stock as part of announced plan
|
—
|
|
|
(3,244
|
)
|
|
—
|
|
|
—
|
|
|
(3,244
|
)
|
|||||
Intercompany distributions
|
68,721
|
|
|
218,322
|
|
|
(261,598
|
)
|
|
(25,445
|
)
|
|
—
|
|
|||||
Dividends paid and discount on dividend reinvestments
|
—
|
|
|
(217,958
|
)
|
|
(2,407
|
)
|
|
—
|
|
|
(220,365
|
)
|
|||||
Net cash provided by/(used in) financing activities
|
63,004
|
|
|
(3,132
|
)
|
|
(308,530
|
)
|
|
27,555
|
|
|
(221,103
|
)
|
|||||
Net increase/(decrease) in cash and cash equivalents
|
105,404
|
|
|
(757
|
)
|
|
(21,675
|
)
|
|
—
|
|
|
82,972
|
|
|||||
Cash and cash equivalents, beginning of year
|
61,516
|
|
|
896
|
|
|
(5,694
|
)
|
|
—
|
|
|
56,718
|
|
|||||
Cash and cash equivalents, end of year
|
$
|
166,920
|
|
|
$
|
139
|
|
|
$
|
(27,369
|
)
|
|
$
|
—
|
|
|
$
|
139,690
|
|
|
|
|
|
|
|
|
Initial Cost
|
|
|
|
Gross Amount at Which
Carried at December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Description
|
Location
|
|
Ownership
Percentage
|
|
Encumbrances
|
|
Land
|
|
Buildings and
Improvements
|
|
Total
|
|
Costs
Capitalized
Subsequent
to
Acquisition
|
|
Land
|
|
Buildings and
Improvements
|
|
Total
|
|
Accumulated
Depreciation
and
Amortization
|
|
Date of
Construction
|
|
Date
Acquired
|
|
Life on
which
Depreciation
and
Amortization
is Computed (in years)
(f)
|
||||||||||||||||||||
1225 EYE STREET (d)
|
Washington, DC
|
|
50
|
%
|
|
57,600
|
|
|
21,959
|
|
|
47,602
|
|
|
69,561
|
|
|
(1,998
|
)
|
|
21,959
|
|
|
45,604
|
|
|
67,563
|
|
|
12,749
|
|
|
1986
|
|
11/19/2003
|
|
0
|
-
|
40
|
||||||||
1201 EYE STREET (e)
|
Washington, DC
|
|
50
|
%
|
|
82,400
|
|
|
31,985
|
|
|
63,139
|
|
|
95,124
|
|
|
(3,089
|
)
|
|
31,985
|
|
|
60,050
|
|
|
92,035
|
|
|
15,595
|
|
|
2001
|
|
11/19/2003
|
|
0
|
-
|
40
|
||||||||
1901 MARKET STREET
|
Philadelphia, PA
|
|
100
|
%
|
|
None
|
|
|
13,584
|
|
|
166,683
|
|
|
180,267
|
|
|
31,497
|
|
|
20,829
|
|
|
190,935
|
|
|
211,764
|
|
|
49,364
|
|
|
1987
|
|
12/18/2003
|
|
0
|
-
|
40
|
||||||||
60 BROAD STREET
|
New York, NY
|
|
100
|
%
|
|
None
|
|
|
32,522
|
|
|
168,986
|
|
|
201,508
|
|
|
3,543
|
|
|
60,708
|
|
|
144,343
|
|
|
205,051
|
|
|
38,111
|
|
|
1962
|
|
12/31/2003
|
|
0
|
-
|
40
|
||||||||
1414 MASSACHUSETTS AVENUE
|
Cambridge, MA
|
|
100
|
%
|
|
None
|
|
|
4,210
|
|
|
35,821
|
|
|
40,031
|
|
|
2,004
|
|
|
4,365
|
|
|
37,670
|
|
|
42,035
|
|
|
14,586
|
|
|
1873
|
|
1/8/2004
|
|
0
|
-
|
40
|
||||||||
ONE BRATTLE SQUARE
|
Cambridge, MA
|
|
100
|
%
|
|
None
|
|
|
6,974
|
|
|
64,940
|
|
|
71,914
|
|
|
(3,920
|
)
|
|
7,113
|
|
|
60,881
|
|
|
67,994
|
|
|
25,873
|
|
|
1991
|
|
2/26/2004
|
|
0
|
-
|
40
|
||||||||
600 CORPORATE DRIVE
|
Lebanon, NJ
|
|
100
|
%
|
|
None
|
|
|
3,934
|
|
|
—
|
|
|
3,934
|
|
|
16,281
|
|
|
3,934
|
|
|
16,281
|
|
|
20,215
|
|
|
5,163
|
|
|
2005
|
|
3/16/2004
|
|
0
|
-
|
40
|
||||||||
1075 WEST ENTRANCE DRIVE
|
Auburn Hills,
MI
|
|
100
|
%
|
|
None
|
|
|
5,200
|
|
|
22,957
|
|
|
28,157
|
|
|
(313
|
)
|
|
5,207
|
|
|
22,637
|
|
|
27,844
|
|
|
5,552
|
|
|
2001
|
|
7/7/2004
|
|
0
|
-
|
40
|
||||||||
3100 CLARENDON BOULEVARD
|
Arlington, VA
|
|
100
|
%
|
|
None
|
|
|
11,700
|
|
|
69,705
|
|
|
81,405
|
|
|
(5,127
|
)
|
|
11,791
|
|
|
64,487
|
|
|
76,278
|
|
|
14,653
|
|
|
1987
|
|
12/9/2004
|
|
0
|
-
|
40
|
||||||||
9200 CORPORATE BOULEVARD
|
Rockville, MD
|
|
100
|
%
|
|
None
|
|
|
3,730
|
|
|
16,608
|
|
|
20,338
|
|
|
(1,402
|
)
|
|
3,882
|
|
|
15,054
|
|
|
18,936
|
|
|
3,383
|
|
|
1982
|
|
12/29/2004
|
|
0
|
-
|
40
|
||||||||
400 BRIDGEWATER CROSSING (c)
|
Bridgewater, NJ
|
|
100
|
%
|
|
29,300
|
|
|
10,400
|
|
|
71,052
|
|
|
81,452
|
|
|
(7,442
|
)
|
|
10,400
|
|
|
63,610
|
|
|
74,010
|
|
|
17,839
|
|
|
2002
|
|
2/17/2006
|
|
0
|
-
|
40
|
||||||||
LAS COLINAS CORPORATE CENTER I
|
Irving, TX
|
|
100
|
%
|
|
17,500
|
|
|
3,912
|
|
|
18,830
|
|
|
22,742
|
|
|
(4,791
|
)
|
|
2,543
|
|
|
15,408
|
|
|
17,951
|
|
|
2,946
|
|
|
1998
|
|
8/31/2006
|
|
0
|
-
|
40
|
||||||||
LAS COLINAS CORPORATE CENTER II
|
Irving, TX
|
|
100
|
%
|
|
25,025
|
|
|
4,496
|
|
|
29,881
|
|
|
34,377
|
|
|
(4,908
|
)
|
|
2,543
|
|
|
26,926
|
|
|
29,469
|
|
|
5,501
|
|
|
1998
|
|
8/31/2006
|
|
0
|
-
|
40
|
||||||||
TWO PIERCE PLACE
|
Itasca, IL
|
|
100
|
%
|
|
None
|
|
|
4,370
|
|
|
70,632
|
|
|
75,002
|
|
|
1,996
|
|
|
4,370
|
|
|
72,628
|
|
|
76,998
|
|
|
19,290
|
|
|
1991
|
|
12/7/2006
|
|
0
|
-
|
40
|
||||||||
2300 CABOT DRIVE
|
Lisle, IL
|
|
100
|
%
|
|
None
|
|
|
4,390
|
|
|
19,549
|
|
|
23,939
|
|
|
(3,558
|
)
|
|
4,390
|
|
|
15,991
|
|
|
20,381
|
|
|
3,908
|
|
|
1998
|
|
5/10/2007
|
|
0
|
-
|
40
|
||||||||
PIEDMONT POINTE I
|
Bethesda, MD
|
|
100
|
%
|
|
None
|
|
|
11,200
|
|
|
58,606
|
|
|
69,806
|
|
|
7,351
|
|
|
11,200
|
|
|
65,957
|
|
|
77,157
|
|
|
10,566
|
|
|
2007
|
|
11/13/2007
|
|
0
|
-
|
40
|
||||||||
PIEDMONT POINTE II
|
Bethesda, MD
|
|
100
|
%
|
|
None
|
|
|
13,300
|
|
|
70,618
|
|
|
83,918
|
|
|
6,638
|
|
|
13,300
|
|
|
77,256
|
|
|
90,556
|
|
|
11,059
|
|
|
2008
|
|
6/25/2008
|
|
0
|
-
|
40
|
||||||||
SUWANEE GATEWAY ONE
|
Suwanee, GA
|
|
100
|
%
|
|
None
|
|
|
1,000
|
|
|
6,875
|
|
|
7,875
|
|
|
78
|
|
|
1,000
|
|
|
6,953
|
|
|
7,953
|
|
|
581
|
|
|
2008
|
|
9/28/2010
|
|
0
|
-
|
40
|
||||||||
ONE MERIDIAN CROSSINGS
|
Richfield, MN
|
|
100
|
%
|
|
None
|
|
|
2,919
|
|
|
24,398
|
|
|
27,317
|
|
|
(1
|
)
|
|
2,919
|
|
|
24,397
|
|
|
27,316
|
|
|
2,238
|
|
|
1997
|
|
10/1/2010
|
|
0
|
-
|
40
|
||||||||
TWO MERIDIAN CROSSINGS
|
Richfield, MN
|
|
100
|
%
|
|
None
|
|
|
2,661
|
|
|
25,742
|
|
|
28,403
|
|
|
215
|
|
|
2,661
|
|
|
25,957
|
|
|
28,618
|
|
|
2,394
|
|
|
1998
|
|
10/1/2010
|
|
0
|
-
|
40
|
||||||||
500 W. MONROE
|
Chicago, IL
|
|
100
|
%
|
|
None
|
|
|
36,990
|
|
|
185,113
|
|
|
222,103
|
|
|
4,038
|
|
|
36,990
|
|
|
189,151
|
|
|
226,141
|
|
|
13,115
|
|
|
1991
|
|
3/31/2011
|
|
0
|
-
|
40
|
||||||||
THE DUPREE
|
Atlanta, GA
|
|
100
|
%
|
|
None
|
|
|
4,080
|
|
|
14,310
|
|
|
18,390
|
|
|
420
|
|
|
4,080
|
|
|
14,730
|
|
|
18,810
|
|
|
1,708
|
|
|
1997
|
|
4/29/2011
|
|
0
|
-
|
40
|
||||||||
THE MEDICI
|
Atlanta, GA
|
|
100
|
%
|
|
None
|
|
|
1,780
|
|
|
11,510
|
|
|
13,290
|
|
|
630
|
|
|
1,780
|
|
|
12,140
|
|
|
13,920
|
|
|
853
|
|
|
2008
|
|
6/7/2011
|
|
0
|
-
|
40
|
||||||||
225 PRESIDENTIAL WAY
|
Boston, MA
|
|
100
|
%
|
|
None
|
|
|
3,626
|
|
|
36,916
|
|
|
40,542
|
|
|
(763
|
)
|
|
3,613
|
|
|
36,166
|
|
|
39,779
|
|
|
3,566
|
|
|
2000
|
|
9/13/2011
|
|
0
|
-
|
40
|
||||||||
235 PRESIDENTIAL WAY
|
Boston, MA
|
|
100
|
%
|
|
None
|
|
|
4,154
|
|
|
44,048
|
|
|
48,202
|
|
|
(911
|
)
|
|
4,138
|
|
|
43,153
|
|
|
47,291
|
|
|
4,238
|
|
|
2001
|
|
9/13/2011
|
|
0
|
-
|
40
|
||||||||
400 TOWNPARK
|
Lake Mary, FL
|
|
100
|
%
|
|
None
|
|
|
2,570
|
|
|
20,555
|
|
|
23,125
|
|
|
620
|
|
|
2,570
|
|
|
21,175
|
|
|
23,745
|
|
|
1,597
|
|
|
2008
|
|
11/10/2011
|
|
0
|
-
|
40
|
|
|
|
|
|
|
|
Initial Cost
|
|
|
|
Gross Amount at Which
Carried at December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Description
|
Location
|
|
Ownership
Percentage
|
|
Encumbrances
|
|
Land
|
|
Buildings and
Improvements
|
|
Total
|
|
Costs
Capitalized
Subsequent
to
Acquisition
|
|
Land
|
|
Buildings and
Improvements
|
|
Total
|
|
Accumulated
Depreciation
and
Amortization
|
|
Date of
Construction
|
|
Date
Acquired
|
|
Life on
which
Depreciation
and
Amortization
is Computed (in years)
(f)
|
||||||||||||||||||||
ARLINGTON GATEWAY
|
Arlington, VA
|
|
100
|
%
|
|
None
|
|
|
36,930
|
|
|
129,070
|
|
|
166,000
|
|
|
(333
|
)
|
|
36,930
|
|
|
128,737
|
|
|
165,667
|
|
|
5,350
|
|
|
2005
|
|
3/4/2013
|
|
0
|
|
40
|
||||||||
5 & 15 WAYSIDE ROAD
|
Burlington, MA
|
|
100
|
%
|
|
None
|
|
|
7,190
|
|
|
55,445
|
|
|
62,635
|
|
|
(631
|
)
|
|
7,190
|
|
|
54,814
|
|
|
62,004
|
|
|
1,579
|
|
|
1999 / 2001
|
|
3/22/2013
|
|
0
|
|
40
|
||||||||
2020 W. 89th STREET
|
Kansas City, MO
|
|
100
|
%
|
|
None
|
|
|
1,430
|
|
|
1,607
|
|
|
3,037
|
|
|
234
|
|
|
1,430
|
|
|
1,841
|
|
|
3,271
|
|
|
65
|
|
|
1992
|
|
8/12/2013
|
|
0
|
|
40
|
||||||||
5301 MARYLAND WAY
|
Brentwood, TN
|
|
100
|
%
|
|
None
|
|
|
5,740
|
|
|
9,717
|
|
|
15,457
|
|
|
—
|
|
|
5,740
|
|
|
9,717
|
|
|
15,457
|
|
|
589
|
|
|
1989
|
|
8/12/2013
|
|
0
|
|
40
|
||||||||
4685 INVESTMENT DRIVE
|
Troy, MI
|
|
100
|
%
|
|
None
|
|
|
1,200
|
|
|
7,840
|
|
|
9,040
|
|
|
135
|
|
|
1,200
|
|
|
7,975
|
|
|
9,175
|
|
|
309
|
|
|
2000
|
|
8/12/2013
|
|
0
|
|
40
|
||||||||
6565 MACARTHUR BOULEVARD
|
Irving, TX
|
|
100
|
%
|
|
None
|
|
|
4,820
|
|
|
37,767
|
|
|
42,587
|
|
|
2
|
|
|
4,820
|
|
|
37,769
|
|
|
42,589
|
|
|
71
|
|
|
1998
|
|
12/5/2013
|
|
0
|
|
40
|
||||||||
ONE LINCOLN PARK
|
Dallas, TX
|
|
100
|
%
|
|
None
|
|
|
6,640
|
|
|
44,810
|
|
|
51,450
|
|
|
—
|
|
|
6,640
|
|
|
44,810
|
|
|
51,450
|
|
|
86
|
|
|
1999
|
|
12/20/2013
|
|
0
|
|
40
|
||||||||
161 CORPORATE CENTER
|
Irving, TX
|
|
100
|
%
|
|
None
|
|
|
2,020
|
|
|
10,680
|
|
|
12,700
|
|
|
—
|
|
|
2,020
|
|
|
10,680
|
|
|
12,700
|
|
|
19
|
|
|
1998
|
|
12/30/2013
|
|
0
|
|
40
|
||||||||
PIEDMONT POWER, LLC (g)
|
Bridgewater, NJ
|
|
100
|
%
|
|
None
|
|
|
—
|
|
|
79
|
|
|
79
|
|
|
2,501
|
|
|
—
|
|
|
2,580
|
|
|
2,580
|
|
|
113
|
|
|
N/A
|
|
12/20/2011
|
|
0
|
-
|
40
|
||||||||
UNDEVELOPED LAND PARCELS (b)
|
Various
|
|
100
|
%
|
|
None
|
|
|
6,021
|
|
|
427
|
|
|
6,448
|
|
|
6,291
|
|
|
12,063
|
|
|
676
|
|
|
12,739
|
|
|
—
|
|
|
N/A
|
|
Various
|
|
|
|
N/A
|
||||||||
Total—Consolidated REIT Properties
|
|
|
|
|
|
|
$
|
650,349
|
|
|
$
|
4,058,105
|
|
|
$
|
4,708,454
|
|
|
$
|
295,283
|
|
|
$
|
688,761
|
|
|
$
|
4,314,976
|
|
|
$
|
5,003,737
|
|
|
$
|
1,051,754
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost
|
|
|
|
Gross Amount at Which Carried at
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
Description
|
Location
|
|
Ownership
Percentage
|
|
Encumbrances
|
|
Land
|
|
Buildings and
Improvements
|
|
Total
|
|
Costs
Capitalized
Subsequent
to
Acquisition
|
|
Land
|
|
Buildings and
Improvements
|
|
Total
|
|
Accumulated
Depreciation
and
Amortization
|
|
Date of
Construction
|
|
Date
Acquired
|
|
Life on
which
Depreciation
and
Amortization
is Computed (in years)
(f)
|
|||||||||||||||||||
8560 UPLAND DRIVE
|
Parker, CO
|
|
72
|
%
|
|
None
|
|
1,954
|
|
|
11,216
|
|
|
13,170
|
|
|
1,089
|
|
|
2,048
|
|
|
12,211
|
|
|
14,259
|
|
|
3,952
|
|
|
2001
|
|
12/21/2001
|
|
0
|
-
|
40
|
||||||||
TWO PARK CENTER
|
Hoffman Estates, IL
|
|
72
|
%
|
|
None
|
|
600
|
|
|
22,682
|
|
|
23,282
|
|
|
(3,273
|
)
|
|
624
|
|
|
19,385
|
|
|
20,009
|
|
|
5,179
|
|
|
1999
|
|
9/19/2003
|
|
0
|
-
|
40
|
||||||||
Total – Unconsolidated JV Properties
|
|
|
|
|
|
|
$
|
2,554
|
|
|
$
|
33,898
|
|
|
$
|
36,452
|
|
|
$
|
(2,184
|
)
|
|
$
|
2,672
|
|
|
$
|
31,596
|
|
|
$
|
34,268
|
|
|
$
|
9,131
|
|
|
|
|
|
|
|
|
|
|
Total – All Properties
|
|
|
|
|
|
|
$
|
652,903
|
|
|
$
|
4,092,003
|
|
|
$
|
4,744,906
|
|
|
$
|
293,099
|
|
|
$
|
691,433
|
|
|
$
|
4,346,572
|
|
|
$
|
5,038,005
|
|
|
$
|
1,060,885
|
|
|
|
|
|
|
|
|
|
(a)
|
Property is owned subject to a long-term ground lease.
|
(b)
|
Undeveloped Land Parcels are not included in Piedmont’s total building count.
|
(c)
|
These properties collateralize the
$350 Million
Secured Pooled Facility.
|
(d)
|
Piedmont purchased all of the membership interest in 1225 Equity, LLC, which own a
49.5%
membership interest in 1225 Eye Street, N.W. Associates, which owns the 1225 Eye Street building. As a result of its ownership of 1225 Equity, LLC, Piedmont owns an approximate
49.5%
in the 1225 Eye Street building. As the controlling member, Piedmont is deemed to have control of the entities and, as such, consolidates the joint ventures.
|
(e)
|
Piedmont purchased all of the membership interest in 1201 Equity, LLC, which own a
49.5%
membership interest in 1201 Eye Street, N.W. Associates, which owns the 1201 Eye Street building. As a result of its ownership of 1201 Equity, LLC, Piedmont owns an approximate
49.5%
in the 1201 Eye Street building. As the controlling member, Piedmont is deemed to have control of the entities and, as such, consolidates the joint ventures.
|
(f)
|
Piedmont’s assets are depreciated or amortized using the straight-lined method over the useful lives of the assets by class. Generally, Tenant Improvements are amortized over the shorter of economic life or lease term, and Lease Intangibles are amortized over the lease term. Generally, Building Improvements are depreciated over
5
-
25
years, Land Improvements are depreciated over
20
-
25
years, and Buildings are depreciated over
40
years.
|
(g)
|
Represents solar panels at the 400 Bridgewater Crossing building, which are not included in Piedmont’s total building count.
|
|
2013
|
|
2012
|
|
2011
|
||||||
Real Estate:
|
|
|
|
|
|
||||||
Balance at the beginning of the year
|
$
|
4,648,904
|
|
|
$
|
4,699,311
|
|
|
$
|
4,666,188
|
|
Additions to/improvements of real estate
|
541,701
|
|
|
108,131
|
|
|
440,141
|
|
|||
Assets disposed
|
(133,249
|
)
|
|
(77,768
|
)
|
|
(361,397
|
)
|
|||
Assets impaired
|
(1,242
|
)
|
|
—
|
|
|
—
|
|
|||
Write-offs of intangible assets
(1)
|
(12,080
|
)
|
|
(73,632
|
)
|
|
(35,916
|
)
|
|||
Write-offs of fully depreciated/amortized assets
|
(6,029
|
)
|
|
(7,138
|
)
|
|
(9,705
|
)
|
|||
Balance at the end of the year
|
$
|
5,038,005
|
|
|
$
|
4,648,904
|
|
|
$
|
4,699,311
|
|
Accumulated Depreciation and Amortization:
|
|
|
|
|
|
||||||
Balance at the beginning of the year
|
$
|
977,768
|
|
|
$
|
935,716
|
|
|
$
|
918,578
|
|
Depreciation and amortization expense
|
140,637
|
|
|
139,196
|
|
|
147,440
|
|
|||
Assets disposed
|
(39,411
|
)
|
|
(16,374
|
)
|
|
(84,681
|
)
|
|||
Write-offs of intangible assets
(1)
|
(12,080
|
)
|
|
(73,632
|
)
|
|
(35,916
|
)
|
|||
Write-offs of fully depreciated/amortized assets
|
(6,029
|
)
|
|
(7,138
|
)
|
|
(9,705
|
)
|
|||
Balance at the end of the year
|
$
|
1,060,885
|
|
|
$
|
977,768
|
|
|
$
|
935,716
|
|
(1)
|
Consists of write-offs of intangible lease assets related to lease restructurings, amendments and terminations.
|
(vi)
|
To file such reports as may be required with the United States Department of Labor, the Internal Revenue Service and any other government agency to which reports may be required to be submitted from time to time; and
|
(i)
|
the specific reason or reasons for the adverse determination;
|
(ii)
|
specific reference to pertinent Plan provisions on which the adverse determination is based;
|
(iii)
|
a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits; and
|
(iv)
|
a statement describing any voluntary appeal procedures offered by the Plan and the claimant’s right to obtain the information about such procedures, as well as a statement of the claimant’s right to bring an action under ERISA section 502(a).
|
_X_
|
(a) This is a newly-established Plan, and the Effective Date of the Plan is January 1, 2014.
|
__
|
(b) This is an amendment of a plan named _____________________ dated _____________ and governing all contributions to the plan through _________________. The Effective Date of this amended Plan is ___________.
|
__
|
(b) This is an amendment of a plan named _____________________ dated ________________ and governing all vested balances in the plan through
|
__
|
(b) This is an amendment of a plan named ____________________ dated ______________ and governing all vested balances in the plan through
|
__
|
(b) This is an amendment and restatement of a plan named _______________________ with an effective date of _________________.
|
__
|
(i) All amounts in Deferred Compensation Accounts shall be subject to the provisions of this amended and restated Plan.
|
__
|
(ii) Any Grandfathered Amounts shall be subject to the Plan rules in effect on October 3, 2004.
|
__
|
(b) The later of age ___ or the _______ anniversary of the participation commencement date. The participation commencement date is the first day of the first Plan Year in which the Participant commenced participation in the Plan.
|
2.26
|
Participating Employer(s):
As of the Effective Date, the following Participating Employer(s) are parties to the Plan:
|
Name of Employer
|
|
EIN
|
Piedmont Government Services, LLC
|
|
20-1210353
|
Piedmont Office Management, LLC
|
|
20-2100780
|
2.30
|
Plan:
The name of the Plan is
|
__
|
(b) Completed __ Years of Service from First Date of Service.
|
__
|
(c) Attained age __ and completed __ Years of Service from First Date of Service.
|
__
|
(d) Attained an age as elected by the Participant.
|
_X_
|
(e) Not applicable – distribution elections for Separation from Service are not based on Seniority Date
|
_X_
|
(a)
Employer Discretionary Credits
: The Employer may make discretionary credits to the Deferred Compensation Account of each Active Participant in an amount determined as follows:
|
_X_
|
(i) An amount determined each Plan Year by the Employer.
|
_X_
|
(b)
Other Employer Credits
: The Employer may make other credits to the Deferred Compensation Account of each Active Participant in an amount determined as follows:
|
_X_
|
(i) An amount determined each Plan Year by the Employer.
|
5.6
|
Unforeseeable Emergency Event:
|
_X_
|
(a) Participants may apply to have accounts distributed upon an Unforeseeable Emergency event.
|
__
|
(b) An Unforeseeable Emergency shall
not
be a Qualifying Distribution Event
|
_X_
|
(i) A lump sum.
|
_X_
|
(ii) Annual installments over a term certain as elected by the Participant not to exceed _5__ years.
|
__
|
(i) A lump sum.
|
_X_
|
(ii) Not Applicable
|
__
|
(i) A lump sum.
|
__
|
(ii) Annual installments over a term certain as elected by the Participant not to exceed ___ years.
|
_X_
|
(i) A lump sum.
|
_X__
|
(ii) Annual installments over a term certain as elected by the Participant not to exceed _5__ years.
|
_X_
|
(i) A lump sum.
|
__
|
(ii) Annual installments over a term certain as elected by the Participant not to exceed ___ years.
|
_X_
|
(i) A lump sum.
|
_X_
|
(ii) Annual installments over a term certain as elected by the Participant not to exceed _5__ years.
|
_X_
|
(i) A lump sum.
|
_X_
|
(ii) Annual installments over a term certain as elected by the Participant not to exceed _5__ years.
|
7.4
|
De Minimis Amounts.
|
_X_
|
(a) Notwithstanding any payment election made by the Participant, the vested balance in the Deferred Compensation Account of the Participant will be distributed in a single lump sum payment at the time designated under the Plan if at the time of a permitted Qualifying Distribution Event that is either a Separation from Service, death, Disability (if applicable) or Change in Control Event (if applicable) the vested balance does not exceed $ _100,000__________. In addition, the Employer may distribute a Participant's vested balance at any time if the balance does not exceed the limit in Section 402(g)(1)(B) of the Code and results in the termination of the Participant's entire interest in the Plan
|
__
|
(b) There shall be no pre-determined de minimis amount under the Plan; however, the Employer may distribute a Participant's vested balance at any time if the balance does not exceed the limit in Section 402(g)(1)(B) of the Code and results in the termination of the Participant's entire interest in the Plan.
|
__
|
(b) Employer or Participating Employer who employed the Participant when amounts were deferred.
|
|
Year ended December 31,
|
||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest Expense
|
$
|
73,614
|
|
|
$
|
65,023
|
|
|
$
|
65,817
|
|
|
$
|
66,486
|
|
|
$
|
71,464
|
|
Interest Expense Included in Discontinued Operations
|
—
|
|
|
—
|
|
|
5,932
|
|
|
6,274
|
|
|
6,279
|
|
|||||
Total
|
73,614
|
|
|
65,023
|
|
|
71,749
|
|
|
72,760
|
|
|
77,743
|
|
|||||
Earnings:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from Continuing Operations
|
71,492
|
|
|
60,140
|
|
|
84,049
|
|
|
104,449
|
|
|
68,750
|
|
|||||
Less Equity in (Income)/Loss of Unconsolidated Joint Ventures
|
3,676
|
|
|
(923
|
)
|
|
(1,619
|
)
|
|
(2,633
|
)
|
|
(104
|
)
|
|||||
Operating Distributions Received from Unconsolidated Joint Ventures
|
1,475
|
|
|
2,338
|
|
|
2,932
|
|
|
4,463
|
|
|
4,445
|
|
|||||
Fixed Charges
|
73,614
|
|
|
65,023
|
|
|
71,749
|
|
|
72,760
|
|
|
77,743
|
|
|||||
Less Preferred Dividends of Consolidated Subsidiaries
|
(15
|
)
|
|
(15
|
)
|
|
(15
|
)
|
|
(15
|
)
|
|
(15
|
)
|
|||||
Total
|
$
|
150,242
|
|
|
$
|
126,563
|
|
|
$
|
157,096
|
|
|
$
|
179,024
|
|
|
$
|
150,819
|
|
Ratio of Earnings to Fixed Charges:
(1)
|
2.0
|
|
1.9
|
|
2.2
|
|
2.5
|
|
1.9
|
Subsidiary
|
|
State of Organization
|
Piedmont Operating Partnership, LP
|
|
Delaware
|
Piedmont Washington Properties, Inc.
|
|
Maryland
|
Piedmont Office Holdings, Inc.
|
|
Georgia
|
Piedmont Office Management, LLC
|
|
Georgia
|
Piedmont Government Services, LLC
|
|
Georgia
|
Piedmont Leasing, LLC
|
|
Delaware
|
Piedmont Power, LLC
|
|
Delaware
|
Piedmont-Las Colinas Springing Member, LLC (f/k/a Wells REIT-Springing Member, LLC)
|
|
Delaware
|
Piedmont 1901 Market Business Trust (f/k/a Wells 1901 Market Business Trust)
|
|
Delaware
|
Piedmont 1901 Market LLC (f/k/a Wells 1901 Market LLC)
|
|
Delaware
|
1055 East Colorado-Pasadena, CA GP, LLC (f/k/a Wells REIT-Pasadena, CA GP, LLC)
|
|
Delaware
|
1055 East Colorado-Pasadena, CA, L.P. (f/k/a Wells REIT-Pasadena, CA, L.P.)
|
|
Delaware
|
Piedmont-Montgomery, LLC (f/k/a Wells REIT-Montgomery, LLC)
|
|
Delaware
|
Piedmont Bridgewater I, LLC (f/k/a Wells Bridgewater I, LLC)
|
|
Delaware
|
Piedmont-Bridgewater, NJ, LLC (f/k/a Wells REIT-Bridgewater, NJ, LLC)
|
|
Delaware
|
Piedmont-Independence Square, LLC (f/k/a Wells REIT - Independence Square, LLC)
|
|
Delaware
|
Piedmont-3100 Clarendon LLC (f/k/a Wells REIT I-3100 Clarendon LLC)
|
|
Delaware
|
Piedmont-Shady Grove V LLC (f/k/a Wells REIT I-Shady Grove V LLC)
|
|
Delaware
|
Piedmont-1075 West Entrance, LLC (f/k/a Wells REIT I-1075 West Entrance, LLC)
|
|
Delaware
|
Piedmont-Multi-State Owner, LLC (f/k/a Wells REIT-Multi-State Owner, LLC)
|
|
Delaware
|
Piedmont-Nashville, TN, LLC (f/k/a Wells REIT-Nashville, TN, LLC)
|
|
Delaware
|
Piedmont-Braker Pointe Austin, TX, L.P. (f/k/a Wells REIT-Austin, TX, L.P.)
|
|
Delaware
|
Piedmont-Braker Pointe Austin, TX GP, LLC (f/k/a Wells REIT-Austin, TX, LLC)
|
|
Delaware
|
Fairway Center II-Orange County, CA, L.P. (f/k/a Wells REIT-Orange County, CA, L.P.)
|
|
Delaware
|
Fairway Center II-Orange County, CA, GP LLC (f/k/a Wells REIT-Orange County, CA, LLC)
|
|
Delaware
|
Piedmont-One Brattle Square I, LLC (f/k/a Wells REIT-One Brattle Square I, LLC)
|
|
Delaware
|
Piedmont-One Brattle Square II, LLC (f/k/a Wells REIT-One Brattle Square II, LLC)
|
|
Delaware
|
4250 North Fairfax Property LLC
|
|
Delaware
|
4250 N. Fairfax Owner, LLC
|
|
Delaware
|
400 Virginia Avenue LLC
|
|
Delaware
|
1201 Eye Street, N.W. Associates LLC
|
|
Delaware
|
1215 ESDI, LLC
|
|
Delaware
|
1225 Equity LLC
|
|
Delaware
|
1225 Eye Street, N.W. Associates LLC
|
|
Delaware
|
1201 Equity LLC
|
|
Delaware
|
TTF Lending LLC
|
|
Delaware
|
TZO Lending LLC
|
|
Delaware
|
Piedmont-Two Pierce Place, LLC (f/k/a Wells REIT-Two Pierce Place, LLC)
|
|
Delaware
|
Piedmont-Las Colinas Corporate Center I, LP (f/k/a Wells REIT-Las Colinas Corporate Center I, LP)
|
|
Delaware
|
Piedmont-Las Colinas Corporate Center I, GP, LLC (f/k/a Wells REIT-Las Colinas Corporate Center I, LLC)
|
|
Delaware
|
Piedmont-Las Colinas Corporate Center II, LP (f/k/a Wells REIT-Las Colinas Corporate Center II, LP)
|
|
Delaware
|
Piedmont-Las Colinas Corporate Center II, GP, LLC (f/k/a Wells REIT-Las Colinas Corporate Center II, LLC)
|
|
Delaware
|
Cypress Concourse A, LLC
|
|
Delaware
|
Piedmont 60 Broad Street, LLC (f/k/a Wells 60 Broad Street, LLC)
|
|
Delaware
|
Piedmont-800 Nicollet Avenue, LLC (f/k/a Wells REIT-800 Nicollet Avenue, LLC)
|
|
Delaware
|
Piedmont-800 Nicollet Avenue Owner, LLC (f/k/a Wells REIT-800 Nicollet Avenue Owner, LLC)
|
|
Delaware
|
Piedmont-800 Nicollet Avenue Springing Member, LLC (f/k/a Wells REIT-800 Nicollet Avenue Springing Member, LLC)
|
|
Delaware
|
Piedmont-Chicago Center Owner, LLC (f/k/a Wells REIT-Chicago Center Owner, LLC)
|
|
Delaware
|
Piedmont-Chicago Center, Chicago, LLC (f/k/a Wells REIT-Chicago Center, Chicago, LLC)
|
|
Delaware
|
Piedmont-Holtsville, NY, LLC (f/k/a Wells REIT-Holtsville, NY, LLC)
|
|
Georgia
|
800 North Brand Glendale, CA, LLC (f/k/a Wells REIT Glendale, CA, LLC)
|
|
Delaware
|
Piedmont-1430 Enclave Parkway, L.P. (f/k/a Wells REIT-1430 Enclave Parkway, L.P.)
|
|
Delaware
|
Piedmont-1430 Enclave Parkway, GP, LLC (f/k/a Wells REIT-1430 Enclave Parkway, LLC)
|
|
Delaware
|
Enclave Parkway Development, LLC
|
|
Delaware
|
Enclave Parkway Development, L.P.
|
|
Delaware
|
Piedmont-Windy Point I, LLC (f/k/a Wells REIT-Windy Point I, LLC)
|
|
Delaware
|
Piedmont-Windy Point II, LLC (f/k/a Wells REIT-Windy Point II, LLC)
|
|
Delaware
|
Piedmont-2300 Cabot Drive, LLC (f/k/a Wells REIT-2300 Cabot Drive, LLC)
|
|
Delaware
|
Rock Spring, L.L.C.
|
|
Delaware
|
Rock Spring II, L.L.C.
|
|
Delaware
|
500 W Monroe Mezz II, LLC
|
|
Delaware
|
500 W Monroe Mezz I-B, LLC
|
|
Delaware
|
500 W Monroe Chicago, LLC
|
|
Delaware
|
150 West Jefferson, LLC
|
|
Delaware
|
Piedmont 500 West Monroe Mezz I, LLC
|
|
Delaware
|
Piedmont 500 West Monroe Fee, LLC
|
|
Delaware
|
Suwanee Gateway One, LLC
|
|
Delaware
|
Meridian Crossings, LLC
|
|
Delaware
|
Dupree Atlanta, LLC
|
|
Delaware
|
Medici Atlanta, LLC
|
|
Delaware
|
Presidential Way Woburn, LLC
|
|
Delaware
|
400 TownPark, LLC
|
|
Delaware
|
Gavitello, Atlanta, LLC
|
|
Delaware
|
Glenridge Highlands III, LLC
|
|
Delaware
|
Piedmont - 901 N. Glebe, LLC
|
|
Delaware
|
Piedmont 5 & 15 Wayside, LLC
|
|
Delaware
|
Piedmont JV Partnership Interests, LLC
|
|
Delaware
|
Piedmont OP - Piedmont JV Partnership Interests, LLC Joint Venture (MI/TN)
|
|
Georgia
|
Piedmont OP - Piedmont JV Partnership Interests, LLC Joint Venture (KS)
|
|
Georgia
|
Piedmont Royal Lane, LP
|
|
Delaware
|
Piedmont Royal Lane GP, LLC
|
|
Delaware
|
Piedmont 6565 MacArthur Boulevard, LP
|
|
Delaware
|
Piedmont 6565 MacArthur Boulevard GP, LLC
|
|
Delaware
|
Piedmont One Lincoln Park, LP
|
|
Delaware
|
Piedmont One Lincoln Park GP, LLC
|
|
Delaware
|
Piedmont 161 Corporate Center, LP
|
|
Delaware
|
Piedmont 161 Corporate Center GP, LLC
|
|
Delaware
|
1.
|
I have reviewed this annual report on Form 10-K of Piedmont Office Realty Trust, 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.
|
By:
|
|
/s/ D
ONALD
A. M
ILLER
, CFA
|
|
|
Donald A. Miller, CFA
|
|
|
Principal Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of Piedmont Office Realty Trust, 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.
|
By:
|
|
/s/ R
OBERT
E. B
OWERS
|
|
|
Robert E. Bowers
|
|
|
Principal Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
|
By:
|
|
/s/ D
ONALD
A. M
ILLER
, CFA
|
|
|
Donald A. Miller, CFA
|
|
|
Chief Executive Officer
|
|
|
February 18, 2014
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
|
By:
|
|
/s/ R
OBERT
E. B
OWERS
|
|
|
Robert E. Bowers
|
|
|
Chief Financial Officer
|
|
|
February 18, 2014
|