|
Maryland
|
|
95-6881527
|
||
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification Number)
|
||
1114 Avenue of the Americas, 39th Floor
|
|
|
||
New York
|
,
|
NY
|
|
10036
|
(Address of principal executive offices)
|
|
(Zip code)
|
Large Accelerated Filer
|
|
Accelerated
Filer
|
|
Non‑accelerated Filer
|
|
Smaller Reporting Company
|
|
Emerging Growth Company
|
☒
|
|
☐
|
|
☐
|
|
☐
|
|
☐
|
Title of each class
|
|
Trading Symbol(s)
|
|
Name of each exchange on which registered
|
Common Stock,
$0.001 par value
|
|
STAR
|
|
New York Stock Exchange
|
8.00% Series D Cumulative Redeemable Preferred Stock,
$0.001 par value
|
|
STAR-PD
|
|
New York Stock Exchange
|
7.65% Series G Cumulative Redeemable Preferred Stock,
$0.001 par value
|
|
STAR-PG
|
|
New York Stock Exchange
|
7.50% Series I Cumulative Redeemable Preferred Stock,
$0.001 par value
|
|
STAR-PI
|
|
New York Stock Exchange
|
|
|
|
Page
|
|
||
|
||
|
||
|
||
|
|
|
|
||
|
||
|
||
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Operating lease income
|
$
|
44,110
|
|
|
$
|
59,109
|
|
|
$
|
158,210
|
|
|
$
|
149,516
|
|
Interest income
|
19,701
|
|
|
22,915
|
|
|
60,417
|
|
|
74,824
|
|
||||
Interest income from sales-type leases
|
8,339
|
|
|
—
|
|
|
12,157
|
|
|
—
|
|
||||
Other income
|
18,270
|
|
|
27,808
|
|
|
43,133
|
|
|
63,951
|
|
||||
Land development revenue
|
54,918
|
|
|
12,309
|
|
|
76,691
|
|
|
369,665
|
|
||||
Total revenues
|
145,338
|
|
|
122,141
|
|
|
350,608
|
|
|
657,956
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
46,522
|
|
|
47,219
|
|
|
136,851
|
|
|
135,572
|
|
||||
Real estate expense
|
23,187
|
|
|
32,287
|
|
|
71,165
|
|
|
105,511
|
|
||||
Land development cost of sales
|
48,101
|
|
|
12,114
|
|
|
71,785
|
|
|
318,881
|
|
||||
Depreciation and amortization
|
14,199
|
|
|
19,979
|
|
|
43,586
|
|
|
41,857
|
|
||||
General and administrative
|
24,110
|
|
|
21,613
|
|
|
72,512
|
|
|
73,655
|
|
||||
(Recovery of) provision for loan losses
|
(3,805
|
)
|
|
200
|
|
|
(3,792
|
)
|
|
18,237
|
|
||||
Impairment of assets
|
—
|
|
|
989
|
|
|
4,953
|
|
|
11,177
|
|
||||
Other expense
|
407
|
|
|
298
|
|
|
12,798
|
|
|
5,180
|
|
||||
Total costs and expenses
|
152,721
|
|
|
134,699
|
|
|
409,858
|
|
|
710,070
|
|
||||
Income from sales of real estate
|
3,476
|
|
|
5,409
|
|
|
233,406
|
|
|
79,353
|
|
||||
Income (loss) from operations before earnings from equity method investments and other items
|
(3,907
|
)
|
|
(7,149
|
)
|
|
174,156
|
|
|
27,239
|
|
||||
Loss on early extinguishment of debt, net
|
—
|
|
|
(911
|
)
|
|
(468
|
)
|
|
(3,447
|
)
|
||||
Earnings (losses) from equity method investments
|
7,617
|
|
|
(635
|
)
|
|
16,566
|
|
|
(4,581
|
)
|
||||
Selling profit from sales-type leases
|
—
|
|
|
—
|
|
|
180,416
|
|
|
—
|
|
||||
Gain on consolidation of equity method investment
|
—
|
|
|
—
|
|
|
—
|
|
|
67,877
|
|
||||
Net income (loss) before income taxes
|
3,710
|
|
|
(8,695
|
)
|
|
370,670
|
|
|
87,088
|
|
||||
Income tax expense
|
(84
|
)
|
|
(137
|
)
|
|
(323
|
)
|
|
(386
|
)
|
||||
Net income (loss)
|
3,626
|
|
|
(8,832
|
)
|
|
370,347
|
|
|
86,702
|
|
||||
Net (income) attributable to noncontrolling interests
|
(2,845
|
)
|
|
(2,028
|
)
|
|
(8,168
|
)
|
|
(11,632
|
)
|
||||
Net income (loss) attributable to iStar Inc.
|
781
|
|
|
(10,860
|
)
|
|
362,179
|
|
|
75,070
|
|
||||
Preferred dividends
|
(8,124
|
)
|
|
(8,124
|
)
|
|
(24,372
|
)
|
|
(24,372
|
)
|
||||
Net income (loss) allocable to common shareholders
|
$
|
(7,343
|
)
|
|
$
|
(18,984
|
)
|
|
$
|
337,807
|
|
|
$
|
50,698
|
|
Per common share data:
|
|
|
|
|
|
|
|
||||||||
Net income (loss) allocable to common shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.12
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
5.23
|
|
|
$
|
0.75
|
|
Diluted
|
$
|
(0.12
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
4.26
|
|
|
$
|
0.69
|
|
Weighted average number of common shares:
|
|
|
|
|
|
|
|
||||||||
Basic
|
62,168
|
|
|
67,975
|
|
|
64,624
|
|
|
67,940
|
|
||||
Diluted
|
62,168
|
|
|
67,975
|
|
|
80,876
|
|
|
83,729
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income (loss)
|
$
|
3,626
|
|
|
$
|
(8,832
|
)
|
|
$
|
370,347
|
|
|
$
|
86,702
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Impact from adoption of new accounting standards
|
—
|
|
|
—
|
|
|
—
|
|
|
276
|
|
||||
Reclassification of losses on cumulative translation adjustment into earnings upon realization(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
721
|
|
||||
Reclassification of (gains) losses on cash flow hedges into earnings upon realization(2)
|
665
|
|
|
101
|
|
|
13,408
|
|
|
(1,683
|
)
|
||||
Unrealized gains (losses) on available-for-sale securities
|
777
|
|
|
(558
|
)
|
|
2,486
|
|
|
(1,514
|
)
|
||||
Unrealized gains (losses) on cash flow hedges
|
(9,091
|
)
|
|
3,900
|
|
|
(45,090
|
)
|
|
6,258
|
|
||||
Unrealized losses on cumulative translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
(364
|
)
|
||||
Other comprehensive income (loss)
|
(7,649
|
)
|
|
3,443
|
|
|
(29,196
|
)
|
|
3,694
|
|
||||
Comprehensive income (loss)
|
(4,023
|
)
|
|
(5,389
|
)
|
|
341,151
|
|
|
90,396
|
|
||||
Comprehensive (income) loss attributable to noncontrolling interests
|
(1,581
|
)
|
|
(2,848
|
)
|
|
(2,224
|
)
|
|
(12,452
|
)
|
||||
Comprehensive income (loss) attributable to iStar Inc.
|
$
|
(5,604
|
)
|
|
$
|
(8,237
|
)
|
|
$
|
338,927
|
|
|
$
|
77,944
|
|
(1)
|
Amounts were reclassified to "Earnings (losses) from equity method investments" in the Company's consolidated statements of operations.
|
(2)
|
Amounts reclassified to "Interest expense" in the Company's consolidated statements of operations is $539 and $957 for the three and nine months ended September 30, 2019, respectively, and $144 for each of the three and nine months ended September 30, 2018. Amount reclassified to "Income from sales of real estate" in the Company's consolidated statements of operations is $806 for the nine months ended September 30, 2019 and amount reclassified to "Gain on consolidation of equity method investment" for the nine months ended September 30, 2018 is $1,876. Amounts reclassified to "Earnings (losses) from equity method investments" in the Company's consolidated statements of operations are $126 and $(28) for the three and nine months ended September 30, 2019, respectively, and $(43) and $47 for the three and nine months ended September 30, 2018, respectively. Amount reclassified to "Other expense" in the Company's consolidated statements of operations is $11,673 for the nine months ended September 30, 2019 resulting from hedged forecasted transactions becoming not probable to occur.
|
|
|
iStar Inc. Shareholders' Equity
|
|
|
|
|
||||||||||||||||||||||||||
|
|
Preferred
Stock(1)
|
|
Preferred Stock Series J(1)
|
|
Common
Stock at
Par
|
|
Additional
Paid-In
Capital
|
|
Retained
Earnings
(Deficit)
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||||||
Balance as of June 30, 2019
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
62
|
|
|
$
|
3,297,303
|
|
|
$
|
(2,139,611
|
)
|
|
$
|
(34,137
|
)
|
|
$
|
197,564
|
|
|
$
|
1,321,197
|
|
Dividends declared—preferred
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,124
|
)
|
|
—
|
|
|
—
|
|
|
(8,124
|
)
|
||||||||
Dividends declared—common ($0.10 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,291
|
)
|
|
—
|
|
|
—
|
|
|
(6,291
|
)
|
||||||||
Issuance of stock/restricted stock unit amortization, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
944
|
|
|
—
|
|
|
—
|
|
|
677
|
|
|
1,621
|
|
||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
781
|
|
|
—
|
|
|
2,845
|
|
|
3,626
|
|
||||||||
Change in accumulated other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,385
|
)
|
|
(1,264
|
)
|
|
(7,649
|
)
|
||||||||
Repurchase of stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(442
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(442
|
)
|
||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,315
|
)
|
|
(3,315
|
)
|
||||||||
Balance as of September 30, 2019
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
62
|
|
|
$
|
3,297,805
|
|
|
$
|
(2,153,245
|
)
|
|
$
|
(40,522
|
)
|
|
$
|
196,507
|
|
|
$
|
1,300,623
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance as of June 30, 2018
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
68
|
|
|
$
|
3,350,750
|
|
|
$
|
(2,325,289
|
)
|
|
$
|
(2,231
|
)
|
|
$
|
189,264
|
|
|
$
|
1,212,578
|
|
Dividends declared—preferred
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,124
|
)
|
|
—
|
|
|
—
|
|
|
(8,124
|
)
|
||||||||
Dividends declared—common ($0.09 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,165
|
)
|
|
—
|
|
|
—
|
|
|
(6,165
|
)
|
||||||||
Issuance of stock/restricted stock unit amortization, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
828
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
828
|
|
||||||||
Net income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,860
|
)
|
|
—
|
|
|
2,028
|
|
|
(8,832
|
)
|
||||||||
Change in accumulated other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,623
|
|
|
820
|
|
|
3,443
|
|
||||||||
Contributions from noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,300
|
|
|
1,300
|
|
||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,826
|
)
|
|
(2,826
|
)
|
||||||||
Balance as of September 30, 2018
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
68
|
|
|
$
|
3,351,578
|
|
|
$
|
(2,350,438
|
)
|
|
$
|
392
|
|
|
$
|
190,586
|
|
|
$
|
1,192,202
|
|
(1)
|
Refer to Note 14 for details on the Company's Preferred Stock.
|
|
|
iStar Inc. Shareholders' Equity
|
|
|
|
|
||||||||||||||||||||||||||
|
|
Preferred
Stock(1)
|
|
Preferred Stock Series J(1)
|
|
Common
Stock at
Par
|
|
Additional
Paid-In
Capital
|
|
Retained
Earnings
(Deficit)
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||||||
Balance as of December 31, 2018
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
68
|
|
|
$
|
3,352,225
|
|
|
$
|
(2,472,061
|
)
|
|
$
|
(17,270
|
)
|
|
$
|
201,137
|
|
|
$
|
1,064,115
|
|
Dividends declared—preferred
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,372
|
)
|
|
—
|
|
|
—
|
|
|
(24,372
|
)
|
||||||||
Dividends declared—common ($0.29 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,991
|
)
|
|
—
|
|
|
—
|
|
|
(18,991
|
)
|
||||||||
Issuance of stock/restricted stock unit amortization, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,361
|
|
|
—
|
|
|
—
|
|
|
2,032
|
|
|
6,393
|
|
||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
362,179
|
|
|
—
|
|
|
8,168
|
|
|
370,347
|
|
||||||||
Change in accumulated other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,252
|
)
|
|
(5,944
|
)
|
|
(29,196
|
)
|
||||||||
Repurchase of stock
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(58,781
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(58,787
|
)
|
||||||||
Contributions from noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,039
|
|
|
2,039
|
|
||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,925
|
)
|
|
(10,925
|
)
|
||||||||
Balance as of September 30, 2019
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
62
|
|
|
$
|
3,297,805
|
|
|
$
|
(2,153,245
|
)
|
|
$
|
(40,522
|
)
|
|
$
|
196,507
|
|
|
$
|
1,300,623
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance as of December 31, 2017
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
68
|
|
|
$
|
3,352,665
|
|
|
$
|
(2,470,564
|
)
|
|
$
|
(2,482
|
)
|
|
$
|
34,546
|
|
|
$
|
914,249
|
|
Dividends declared—preferred
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,372
|
)
|
|
—
|
|
|
—
|
|
|
(24,372
|
)
|
||||||||
Dividends declared—common ($0.09 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,165
|
)
|
|
—
|
|
|
—
|
|
|
(6,165
|
)
|
||||||||
Issuance of stock/restricted stock unit amortization, net
|
|
—
|
|
|
—
|
|
|
1
|
|
|
7,216
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,217
|
|
||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75,070
|
|
|
—
|
|
|
11,632
|
|
|
86,702
|
|
||||||||
Change in accumulated other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,598
|
|
|
820
|
|
|
3,418
|
|
||||||||
Repurchase of stock
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(8,303
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,304
|
)
|
||||||||
Contributions from noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,309
|
|
|
1,309
|
|
||||||||
Distributions to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46,000
|
)
|
|
(46,000
|
)
|
||||||||
Change in noncontrolling interest attributable to consolidation of equity method investment (refer to Note 8)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
188,279
|
|
|
188,279
|
|
||||||||
Impact from adoption of new accounting standards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75,593
|
|
|
276
|
|
|
—
|
|
|
75,869
|
|
||||||||
Balance as of September 30, 2018
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
68
|
|
|
$
|
3,351,578
|
|
|
$
|
(2,350,438
|
)
|
|
$
|
392
|
|
|
$
|
190,586
|
|
|
$
|
1,192,202
|
|
(1)
|
Refer to Note 14 for details on the Company's Preferred Stock.
|
|
For the Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
370,347
|
|
|
$
|
86,702
|
|
Adjustments to reconcile net income to cash flows from operating activities:
|
|
|
|
||||
Provision for loan losses
|
(3,792
|
)
|
|
18,237
|
|
||
Impairment of assets
|
4,953
|
|
|
11,177
|
|
||
Depreciation and amortization
|
43,586
|
|
|
41,857
|
|
||
Non-cash interest income from sales-type leases
|
(2,228
|
)
|
|
—
|
|
||
Stock-based compensation expense
|
20,694
|
|
|
16,245
|
|
||
Amortization of discounts/premiums and deferred financing costs on debt obligations, net
|
10,573
|
|
|
11,715
|
|
||
Amortization of discounts/premiums and deferred interest on loans, net
|
(33,136
|
)
|
|
(29,138
|
)
|
||
Deferred interest on loans received
|
9,507
|
|
|
40,463
|
|
||
Gain from consolidation of equity method investment
|
—
|
|
|
(67,877
|
)
|
||
Selling profit from sales-type leases
|
(180,416
|
)
|
|
—
|
|
||
Earnings from equity method investments
|
(16,566
|
)
|
|
4,581
|
|
||
Distributions from operations of other investments
|
15,712
|
|
|
10,875
|
|
||
Deferred operating lease income
|
(12,210
|
)
|
|
(8,119
|
)
|
||
Income from sales of real estate
|
(233,406
|
)
|
|
(79,353
|
)
|
||
Land development revenue in excess of cost of sales
|
(4,906
|
)
|
|
(50,784
|
)
|
||
Loss on early extinguishment of debt, net
|
468
|
|
|
3,447
|
|
||
Other operating activities, net
|
12,827
|
|
|
1,775
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Deposit on loan to be held for sale
|
(21,226
|
)
|
|
—
|
|
||
Changes in accrued interest and operating lease income receivable
|
2,010
|
|
|
2,574
|
|
||
Changes in deferred expenses and other assets, net
|
(8,268
|
)
|
|
(3,767
|
)
|
||
Changes in accounts payable, accrued expenses and other liabilities
|
(50,319
|
)
|
|
(47,227
|
)
|
||
Cash flows used in operating activities
|
(75,796
|
)
|
|
(36,617
|
)
|
||
Cash flows from investing activities:
|
|
|
|
||||
Originations and fundings of loans receivable, net
|
(191,559
|
)
|
|
(421,518
|
)
|
||
Capital expenditures on real estate assets
|
(21,081
|
)
|
|
(44,211
|
)
|
||
Capital expenditures on land and development assets
|
(93,395
|
)
|
|
(98,489
|
)
|
||
Acquisitions of real estate, net investments in leases and land assets
|
(240,487
|
)
|
|
(3,390
|
)
|
||
Repayments of and principal collections on loans receivable and other lending investments, net
|
380,071
|
|
|
714,898
|
|
||
Net proceeds from sales of loans receivable
|
5,898
|
|
|
—
|
|
||
Net proceeds from sales of real estate
|
307,493
|
|
|
271,358
|
|
||
Net proceeds from sales of land and development assets
|
73,733
|
|
|
183,520
|
|
||
Cash, cash equivalents and restricted cash acquired upon consolidation of equity method investment
|
—
|
|
|
13,608
|
|
||
Distributions from other investments
|
60,411
|
|
|
27,086
|
|
||
Contributions to and acquisition of interest in other investments
|
(494,339
|
)
|
|
(68,666
|
)
|
||
Other investing activities, net
|
(28,002
|
)
|
|
5,019
|
|
||
Cash flows provided by (used in) investing activities
|
(241,257
|
)
|
|
579,215
|
|
||
Cash flows from financing activities:
|
|
|
|
||||
Borrowings from debt obligations
|
834,980
|
|
|
349,988
|
|
||
Repayments and repurchases of debt obligations
|
(389,571
|
)
|
|
(690,452
|
)
|
||
Preferred dividends paid
|
(24,372
|
)
|
|
(24,372
|
)
|
||
Common dividends paid
|
(18,764
|
)
|
|
(6,103
|
)
|
||
Repurchase of stock
|
(58,787
|
)
|
|
(8,304
|
)
|
||
Payments for deferred financing costs
|
(11,416
|
)
|
|
(6,276
|
)
|
||
Payments for withholding taxes upon vesting of stock-based compensation
|
(1,842
|
)
|
|
(4,187
|
)
|
||
Contributions from noncontrolling interests
|
2,039
|
|
|
9
|
|
||
Distributions to noncontrolling interests
|
(10,925
|
)
|
|
(46,000
|
)
|
||
Other financing activities, net
|
—
|
|
|
7,694
|
|
||
Cash flows used in financing activities
|
321,342
|
|
|
(428,003
|
)
|
||
Effect of exchange rate changes on cash
|
(15
|
)
|
|
30
|
|
||
Changes in cash, cash equivalents and restricted cash
|
4,274
|
|
|
114,625
|
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
974,544
|
|
|
677,733
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
$
|
978,818
|
|
|
$
|
792,358
|
|
|
For the Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Supplemental disclosure of non-cash investing and financing activity:
|
|
|
|
||||
Fundings and (repayments) of loan receivables and loan participations, net
|
$
|
10,547
|
|
|
$
|
(84,213
|
)
|
Accounts payable for capital expenditures on real estate assets
|
—
|
|
|
2,184
|
|
||
Contributions of land and development assets to equity method investments, net
|
4,073
|
|
|
—
|
|
||
Sales-type lease origination
|
411,523
|
|
|
—
|
|
||
Acquisition of land and development asset through joint venture consolidation
|
27,000
|
|
|
—
|
|
||
Accounts payable for capital expenditures on land and development assets
|
—
|
|
|
9,169
|
|
||
Assumption of mortgage by third party
|
228,000
|
|
|
—
|
|
||
Accounts payable for finance costs
|
1,878
|
|
|
—
|
|
||
Acquisitions of land and development assets through foreclosure
|
—
|
|
|
4,600
|
|
||
Financing provided on sales of land and development assets, net
|
—
|
|
|
142,639
|
|
||
Increase in net lease assets upon consolidation of equity method investment
|
—
|
|
|
844,550
|
|
||
Increase in debt obligations upon consolidation of equity method investment
|
—
|
|
|
464,706
|
|
||
Increase in noncontrolling interests upon consolidation of equity method investment
|
—
|
|
|
200,093
|
|
|
As of
|
||||||
|
September 30,
2019 |
|
December 31,
2018 |
||||
ASSETS
|
|
|
|
||||
Real estate
|
|
|
|
||||
Real estate, at cost
|
$
|
888,277
|
|
|
$
|
848,052
|
|
Less: accumulated depreciation
|
(31,458
|
)
|
|
(15,365
|
)
|
||
Real estate, net
|
856,819
|
|
|
832,687
|
|
||
Land and development, net
|
282,082
|
|
|
279,031
|
|
||
Other investments
|
52
|
|
|
72
|
|
||
Cash and cash equivalents
|
26,153
|
|
|
25,219
|
|
||
Accrued interest and operating lease income receivable, net
|
858
|
|
|
1,302
|
|
||
Deferred operating lease income receivable, net
|
16,958
|
|
|
8,972
|
|
||
Deferred expenses and other assets, net
|
137,261
|
|
|
167,324
|
|
||
Total assets
|
$
|
1,320,183
|
|
|
$
|
1,314,607
|
|
LIABILITIES
|
|
|
|
||||
Accounts payable, accrued expenses and other liabilities
|
$
|
117,136
|
|
|
$
|
106,907
|
|
Debt obligations, net
|
485,032
|
|
|
485,000
|
|
||
Total liabilities
|
602,168
|
|
|
591,907
|
|
|
|
September 30, 2019
|
|
December 31, 2018
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||
Cash and cash equivalents
|
|
$
|
917,309
|
|
|
$
|
931,751
|
|
|
$
|
757,384
|
|
|
$
|
657,688
|
|
Restricted cash included in deferred expenses and other assets, net(1)
|
|
61,509
|
|
|
42,793
|
|
|
34,974
|
|
|
20,045
|
|
||||
Total cash, cash equivalents and restricted cash reported in the consolidated statements of cash flows
|
|
$
|
978,818
|
|
|
$
|
974,544
|
|
|
$
|
792,358
|
|
|
$
|
677,733
|
|
(1)
|
Restricted cash represents amounts required to be maintained under certain of the Company's debt obligations, loans, leasing, land development, sale and derivative transactions.
|
|
Net Lease(1)
|
|
Operating
Properties
|
|
Total
|
||||||
As of September 30, 2019
|
|
|
|
|
|
||||||
Land, at cost
|
$
|
201,197
|
|
|
$
|
106,187
|
|
|
$
|
307,384
|
|
Buildings and improvements, at cost
|
1,342,319
|
|
|
106,821
|
|
|
1,449,140
|
|
|||
Less: accumulated depreciation
|
(213,618
|
)
|
|
(12,790
|
)
|
|
(226,408
|
)
|
|||
Real estate, net
|
1,329,898
|
|
|
200,218
|
|
|
1,530,116
|
|
|||
Real estate available and held for sale (2)
|
—
|
|
|
12,688
|
|
|
12,688
|
|
|||
Total real estate
|
$
|
1,329,898
|
|
|
$
|
212,906
|
|
|
$
|
1,542,804
|
|
As of December 31, 2018
|
|
|
|
|
|
||||||
Land, at cost
|
$
|
336,740
|
|
|
$
|
133,599
|
|
|
$
|
470,339
|
|
Buildings and improvements, at cost
|
1,487,270
|
|
|
118,724
|
|
|
1,605,994
|
|
|||
Less: accumulated depreciation
|
(287,516
|
)
|
|
(17,798
|
)
|
|
(305,314
|
)
|
|||
Real estate, net
|
1,536,494
|
|
|
234,525
|
|
|
1,771,019
|
|
|||
Real estate available and held for sale (2)
|
1,055
|
|
|
21,496
|
|
|
22,551
|
|
|||
Total real estate
|
$
|
1,537,549
|
|
|
$
|
256,021
|
|
|
$
|
1,793,570
|
|
(1)
|
In May 2019, the Company modified certain of its leases. As a result of these modifications, the Company is required to account for the leases as sales-type leases and recorded $424.1 million in "Net investment in leases" and derecognized $193.4 million from "Real estate, net" and "Real estate available and held for sale" on its consolidated balance sheet (refer to Note 5).
|
(2)
|
As of September 30, 2019 and December 31, 2018, the Company had $11.7 million and $20.6 million, respectively, of residential condominiums available for sale in its operating properties portfolio.
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Operating Properties
|
|
|
|
|
||||
Proceeds(1)
|
|
$
|
80.2
|
|
|
$
|
228.7
|
|
Income from sales of real estate(1)
|
|
10.2
|
|
|
54.5
|
|
||
|
|
|
|
|
||||
Net Lease
|
|
|
|
|
||||
Proceeds(2)
|
|
$
|
452.7
|
|
|
$
|
38.4
|
|
Income from sales of real estate(2)
|
|
223.2
|
|
|
24.9
|
|
||
|
|
|
|
|
||||
Total
|
|
|
|
|
||||
Proceeds
|
|
$
|
532.9
|
|
|
$
|
267.1
|
|
Income from sales of real estate
|
|
233.4
|
|
|
79.4
|
|
(1)
|
During the nine months ended September 30, 2019, the Company sold commercial and residential operating properties with an aggregate carrying value of $70.0 million and recognized gains of $10.2 million in "Income from sales of real estate" in the Company's consolidated statements of operations. During the nine months ended September 30, 2018, the Company sold commercial and residential operating properties and recognized $54.5 million of gains in "Income from sales of real estate" in the Company's consolidated statements of operations, of which $9.8 million was attributable to a noncontrolling interest at one of the properties.
|
(2)
|
During the nine months ended September 30, 2019, the Company sold a portfolio of net lease assets with an aggregate carrying value of $220.4 million and recognized gains of $219.7 million in "Income from sales of real estate" in the Company's consolidated statements of operations. In connection with the sale of this portfolio of assets the buyer assumed a $228.0 million non-recourse mortgage. During the nine months ended September 30, 2018, the Company sold net lease assets and recognized $24.9 million of gains in "Income from sales of real estate" in the Company's consolidated statements of operations.
|
|
|
Amount
|
||
2019 (remaining three months)
|
|
$
|
6,891
|
|
2020
|
|
27,565
|
|
|
2021
|
|
28,062
|
|
|
2022
|
|
30,549
|
|
|
2023
|
|
30,549
|
|
|
Thereafter
|
|
925,293
|
|
|
Total undiscounted cash flows
|
|
1,048,909
|
|
|
Unguaranteed estimated residual value
|
|
343,995
|
|
|
Present value discount
|
|
(971,652
|
)
|
|
Net investment in leases as of September 30, 2019
|
|
$
|
421,252
|
|
|
As of
|
||||||
|
September 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Land and land development, at cost
|
$
|
619,745
|
|
|
$
|
606,849
|
|
Less: accumulated depreciation
|
(9,365
|
)
|
|
(8,631
|
)
|
||
Total land and development, net
|
$
|
610,380
|
|
|
$
|
598,218
|
|
|
As of
|
||||||
Type of Investment
|
September 30,
2019 |
|
December 31,
2018 |
||||
Senior mortgages
|
$
|
554,567
|
|
|
$
|
760,749
|
|
Corporate/Partnership loans
|
121,500
|
|
|
148,583
|
|
||
Subordinate mortgages
|
10,695
|
|
|
10,161
|
|
||
Total gross carrying value of loans
|
686,762
|
|
|
919,493
|
|
||
Reserves for loan losses
|
(30,401
|
)
|
|
(53,395
|
)
|
||
Total loans receivable, net
|
656,361
|
|
|
866,098
|
|
||
Other lending investments(1)
|
151,928
|
|
|
122,126
|
|
||
Total loans receivable and other lending investments, net
|
$
|
808,289
|
|
|
$
|
988,224
|
|
(1)
|
As of September 30, 2019, includes $44.2 million related to the acquisition of bowling centers from one of the Company's lessees (refer to Note 5).
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Reserve for loan losses at beginning of period
|
|
$
|
53,408
|
|
|
$
|
54,495
|
|
|
$
|
53,395
|
|
|
$
|
78,489
|
|
(Recovery of) provision for loan losses
|
|
(3,805
|
)
|
|
200
|
|
|
(3,792
|
)
|
|
18,237
|
|
||||
Charge-offs
|
|
(19,202
|
)
|
|
—
|
|
|
(19,202
|
)
|
|
(42,031
|
)
|
||||
Reserve for loan losses at end of period
|
|
$
|
30,401
|
|
|
$
|
54,695
|
|
|
$
|
30,401
|
|
|
$
|
54,695
|
|
|
Individually
Evaluated for
Impairment(1)
|
|
Collectively
Evaluated for
Impairment(2)
|
|
Total
|
||||||
As of September 30, 2019
|
|
|
|
|
|
||||||
Loans
|
$
|
38,400
|
|
|
$
|
652,523
|
|
|
$
|
690,923
|
|
Less: Reserve for loan losses
|
(21,701
|
)
|
|
(8,700
|
)
|
|
(30,401
|
)
|
|||
Total(3)
|
$
|
16,699
|
|
|
$
|
643,823
|
|
|
$
|
660,522
|
|
As of December 31, 2018
|
|
|
|
|
|
||||||
Loans
|
$
|
66,725
|
|
|
$
|
857,662
|
|
|
$
|
924,387
|
|
Less: Reserve for loan losses
|
(40,395
|
)
|
|
(13,000
|
)
|
|
(53,395
|
)
|
|||
Total(3)
|
$
|
26,330
|
|
|
$
|
844,662
|
|
|
$
|
870,992
|
|
(1)
|
The carrying value of these loans include unamortized discounts, premiums, deferred fees and costs totaling net discounts of $0.1 million and $0.5 million as of September 30, 2019 and December 31, 2018, respectively. The Company's loans individually evaluated for impairment primarily represent loans on non-accrual status; therefore, the unamortized amounts associated with these loans are not currently being amortized into income.
|
(2)
|
The carrying value of these loans include unamortized discounts, premiums, deferred fees and costs totaling net discounts of $1.3 million and $3.1 million as of September 30, 2019 and December 31, 2018, respectively.
|
(3)
|
The Company's recorded investment in loans as of September 30, 2019 and December 31, 2018 includes accrued interest of $4.2 million and $4.9 million, respectively, which is included in "Accrued interest and operating lease income receivable, net" on the Company's consolidated balance sheets. As of September 30, 2019, excludes $44.2 million of other lending investments that are evaluated for impairment when, based upon current information and events, the Company believes it is probable that it will be unable to collect all amounts due under the contractual terms of the lease (refer to Note 5). As of September 30, 2019 and December 31, 2018, the total amounts exclude $107.7 million and $122.1 million, respectively, of securities that are evaluated for impairment under ASC 320.
|
|
As of September 30, 2019
|
|
As of December 31, 2018
|
||||||||||
|
Performing
Loans
|
|
Weighted
Average
Risk Ratings
|
|
Performing
Loans
|
|
Weighted
Average
Risk Ratings
|
||||||
Senior mortgages
|
$
|
519,289
|
|
|
2.71
|
|
|
$
|
697,807
|
|
|
2.76
|
|
Corporate/Partnership loans
|
122,507
|
|
|
3.15
|
|
|
149,663
|
|
|
2.84
|
|
||
Subordinate mortgages
|
10,727
|
|
|
3.00
|
|
|
10,192
|
|
|
3.00
|
|
||
Total
|
$
|
652,523
|
|
|
2.80
|
|
|
$
|
857,662
|
|
|
2.77
|
|
|
Current
|
|
Less Than
and Equal
to 90 Days
|
|
Greater
Than
90 Days(1)
|
|
Total
Past Due
|
|
Total
|
||||||||||
As of September 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
Senior mortgages
|
$
|
519,289
|
|
|
$
|
—
|
|
|
$
|
38,400
|
|
|
$
|
38,400
|
|
|
$
|
557,689
|
|
Corporate/Partnership loans
|
122,507
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
122,507
|
|
|||||
Subordinate mortgages
|
10,727
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,727
|
|
|||||
Total
|
$
|
652,523
|
|
|
$
|
—
|
|
|
$
|
38,400
|
|
|
$
|
38,400
|
|
|
$
|
690,923
|
|
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Senior mortgages
|
$
|
703,807
|
|
|
$
|
—
|
|
|
$
|
60,725
|
|
|
$
|
60,725
|
|
|
$
|
764,532
|
|
Corporate/Partnership loans
|
149,663
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
149,663
|
|
|||||
Subordinate mortgages
|
10,192
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,192
|
|
|||||
Total
|
$
|
863,662
|
|
|
$
|
—
|
|
|
$
|
60,725
|
|
|
$
|
60,725
|
|
|
$
|
924,387
|
|
(1)
|
As of September 30, 2019, the Company had one loan which was greater than 90 days delinquent and was in various stages of resolution, including legal and environmental matters, and was 10.3 years outstanding. As of December 31, 2018, the Company had two loans which were greater than 90 days delinquent and were in various stages of resolution, including legal and foreclosure-related proceedings and environmental matters, and ranged from 4.0 years to 9.0 years outstanding.
|
|
As of September 30, 2019
|
|
As of December 31, 2018
|
||||||||||||||||||||
|
Recorded
Investment
|
|
Unpaid
Principal
Balance
|
|
Related
Allowance
|
|
Recorded
Investment
|
|
Unpaid
Principal
Balance
|
|
Related
Allowance
|
||||||||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Senior mortgages
|
$
|
38,400
|
|
|
$
|
38,501
|
|
|
$
|
(21,701
|
)
|
|
$
|
66,725
|
|
|
$
|
66,777
|
|
|
$
|
(40,395
|
)
|
Total
|
$
|
38,400
|
|
|
$
|
38,501
|
|
|
$
|
(21,701
|
)
|
|
$
|
66,725
|
|
|
$
|
66,777
|
|
|
$
|
(40,395
|
)
|
(1)
|
All of the Company's non-accrual loans are considered impaired and included in the table above.
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||||||
|
Average
Recorded Investment |
|
Interest
Income Recognized |
|
Average
Recorded Investment |
|
Interest
Income Recognized |
|
Average
Recorded
Investment
|
|
Interest
Income
Recognized
|
|
Average
Recorded
Investment
|
|
Interest
Income
Recognized
|
||||||||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Subordinate mortgages
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
209
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
301
|
|
Subtotal
|
—
|
|
|
—
|
|
|
—
|
|
|
209
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
301
|
|
||||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Senior mortgages
|
38,572
|
|
|
—
|
|
|
67,001
|
|
|
—
|
|
|
39,074
|
|
|
—
|
|
|
70,696
|
|
|
—
|
|
||||||||
Corporate/Partnership loans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
78,302
|
|
|
—
|
|
||||||||
Subtotal
|
38,572
|
|
|
—
|
|
|
67,001
|
|
|
—
|
|
|
39,074
|
|
|
—
|
|
|
148,998
|
|
|
—
|
|
||||||||
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Senior mortgages
|
38,572
|
|
|
—
|
|
|
67,001
|
|
|
—
|
|
|
39,074
|
|
|
—
|
|
|
70,696
|
|
|
—
|
|
||||||||
Corporate/Partnership loans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
78,302
|
|
|
—
|
|
||||||||
Subordinate mortgages
|
—
|
|
|
—
|
|
|
—
|
|
|
209
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
301
|
|
||||||||
Total
|
$
|
38,572
|
|
|
$
|
—
|
|
|
$
|
67,001
|
|
|
$
|
209
|
|
|
$
|
39,074
|
|
|
$
|
—
|
|
|
$
|
148,998
|
|
|
$
|
301
|
|
|
Face
Value
|
|
Amortized Cost Basis
|
|
Net Unrealized Gain
|
|
Estimated Fair Value
|
|
Net Carrying Value
|
||||||||||
As of September 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
Available-for-Sale Securities
|
|
|
|
|
|
|
|
|
|
||||||||||
Municipal debt securities
|
$
|
21,140
|
|
|
$
|
21,140
|
|
|
$
|
2,962
|
|
|
$
|
24,102
|
|
|
$
|
24,102
|
|
Held-to-Maturity Securities
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt securities
|
100,000
|
|
|
83,593
|
|
|
—
|
|
|
83,593
|
|
|
83,593
|
|
|||||
Total
|
$
|
121,140
|
|
|
$
|
104,733
|
|
|
$
|
2,962
|
|
|
$
|
107,695
|
|
|
$
|
107,695
|
|
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Available-for-Sale Securities
|
|
|
|
|
|
|
|
|
|
||||||||||
Municipal debt securities
|
$
|
21,185
|
|
|
$
|
21,185
|
|
|
$
|
476
|
|
|
$
|
21,661
|
|
|
$
|
21,661
|
|
Held-to-Maturity Securities
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt securities
|
120,866
|
|
|
100,465
|
|
|
7
|
|
|
100,472
|
|
|
100,465
|
|
|||||
Total
|
$
|
142,051
|
|
|
$
|
121,650
|
|
|
$
|
483
|
|
|
$
|
122,133
|
|
|
$
|
122,126
|
|
|
Held-to-Maturity Securities
|
|
Available-for-Sale Securities
|
||||||||||||
|
Amortized Cost Basis
|
|
Estimated Fair Value
|
|
Amortized Cost Basis
|
|
Estimated Fair Value
|
||||||||
Maturities
|
|
|
|
|
|
|
|
||||||||
Within one year
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
After one year through 5 years
|
83,593
|
|
|
83,593
|
|
|
—
|
|
|
—
|
|
||||
After 5 years through 10 years
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
After 10 years
|
—
|
|
|
—
|
|
|
21,140
|
|
|
24,102
|
|
||||
Total
|
$
|
83,593
|
|
|
$
|
83,593
|
|
|
$
|
21,140
|
|
|
$
|
24,102
|
|
|
|
|
Equity in Earnings (Losses)
|
||||||||||||||||||||
|
Carrying Value as of
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months
Ended September 30, |
||||||||||||||||||
|
September 30, 2019
|
|
December 31, 2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||
Real estate equity investments
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Safehold Inc. ("SAFE")
|
$
|
581,059
|
|
|
$
|
149,589
|
|
|
$
|
2,946
|
|
|
$
|
775
|
|
|
$
|
14,076
|
|
|
$
|
2,927
|
|
iStar Net Lease II LLC ("Net Lease Venture II")
|
5,300
|
|
|
16,215
|
|
|
(98
|
)
|
|
—
|
|
|
(416
|
)
|
|
—
|
|
||||||
iStar Net Lease I LLC ("Net Lease Venture")(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,100
|
|
||||||
Other real estate equity investments(2)
|
103,021
|
|
|
130,955
|
|
|
4,574
|
|
|
(2,062
|
)
|
|
2,744
|
|
|
(2,087
|
)
|
||||||
Subtotal
|
689,380
|
|
|
296,759
|
|
|
7,422
|
|
|
(1,287
|
)
|
|
16,404
|
|
|
4,940
|
|
||||||
Other strategic investments(3)
|
44,413
|
|
|
7,516
|
|
|
195
|
|
|
652
|
|
|
162
|
|
|
(9,521
|
)
|
||||||
Total
|
$
|
733,793
|
|
|
$
|
304,275
|
|
|
$
|
7,617
|
|
|
$
|
(635
|
)
|
|
$
|
16,566
|
|
|
$
|
(4,581
|
)
|
(1)
|
The Company consolidated the assets and liabilities of the Net Lease Venture on June 30, 2018 (refer to Net Lease Venture below).
|
(2)
|
During the three and nine months ended September 30, 2019, equity in earnings (losses) includes $8.2 million of income resulting from the sale of a property at one of the Company's equity method investments.
|
(3)
|
For the nine months ended September 30, 2018, equity in earnings (losses) includes a $10.0 million impairment on a foreign equity method investment due to local market conditions.
|
•
|
limits the Company's discretionary voting power to 41.9% of the outstanding voting power of SAFE's common stock until its aggregate ownership of SAFE common stock is less than 41.9%;
|
•
|
requires the Company to cast all of its voting power in favor of three director nominees to SAFE's board who are independent of each of the Company and SAFE for three years;
|
•
|
subjects the Company to certain standstill provisions for two years;
|
•
|
restricts the Company's ability to transfer shares of SAFE common stock issued in exchange for Investor Units, or "Exchange Shares," for one year after their issuance;
|
•
|
prohibits the Company from transferring shares of SAFE common stock representing more than 20% of the outstanding SAFE common stock in one transaction or a series of related transactions to any person or group, other than pursuant to a widely distributed public offering, unless SAFE's other stockholders have participation rights in the transaction; and
|
•
|
provides the Company certain preemptive rights.
|
•
|
The Company received no management fee through June 30, 2018, which covered the first year of the management agreement;
|
•
|
The Company receives a fee equal to 1.0% of total SAFE equity (as defined in the management agreement) up to $1.5 billion; 1.25% of total SAFE equity (for incremental equity of $1.5 billion - $3.0 billion); 1.375% of total SAFE equity (for incremental equity of $3.0 billion - $5.0 billion); and 1.5% of total SAFE equity (for incremental equity over $5.0 billion);
|
•
|
Fee to be paid in cash or in shares of SAFE common stock, at the discretion of SAFE's independent directors;
|
•
|
The stock is locked up for two years, subject to certain restrictions;
|
•
|
There is no additional performance or incentive fee;
|
•
|
From January 1, 2019 through June 30, 2022, the management agreement is non-terminable by SAFE except for cause; and
|
•
|
Automatic annual renewals thereafter, subject to non-renewal upon certain findings by SAFE's independent directors and payment of termination fee equal to three times the prior year's management fee, subject to SAFE having raised $820 million of total equity since inception.
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
Intangible assets, net(1)
|
$
|
176,557
|
|
|
$
|
156,281
|
|
Restricted cash
|
61,509
|
|
|
42,793
|
|
||
Finance lease right-of-use assets(2)
|
145,528
|
|
|
—
|
|
||
Operating lease right-of-use assets(2)
|
27,816
|
|
|
—
|
|
||
Other assets(3)
|
23,826
|
|
|
32,333
|
|
||
Other receivables(4)
|
42,129
|
|
|
46,887
|
|
||
Leasing costs, net(5)
|
4,585
|
|
|
6,224
|
|
||
Corporate furniture, fixtures and equipment, net(6)
|
2,980
|
|
|
3,850
|
|
||
Deferred financing fees, net
|
2,498
|
|
|
900
|
|
||
Deferred expenses and other assets, net
|
$
|
487,428
|
|
|
$
|
289,268
|
|
(1)
|
Intangible assets, net includes above market and in-place lease assets and lease incentives related to the acquisition of real estate assets. Accumulated amortization on intangible assets, net was $30.5 million and $27.0 million as of September 30, 2019 and December 31, 2018, respectively. The amortization of above market leases and lease incentive assets decreased operating lease income in the Company's consolidated statements of operations by $0.4 million and $1.4 million for the three and nine months ended September 30, 2019, respectively, and $0.9 million and $1.6 million for the three and nine months ended September 30, 2018, respectively. These intangible lease assets are amortized over the remaining term of the lease. The amortization expense for in-place leases was $2.4 million and $6.9 million for the three and nine months ended September 30, 2019, respectively, and $4.0 million and $4.7 million for the three and nine months ended September 30, 2018, respectively. These amounts are included in "Depreciation and amortization" in the Company's consolidated statements of operations.
|
(2)
|
Right-of-use lease assets relate primarily to the Company's leases of office space and certain of its ground leases. Right-of use lease assets initially equal the lease liability. The lease liability (see table below) equals the present value of the minimum rental payments due under the lease discounted at the rate implicit in the lease or the Company's incremental secured borrowing rate for similar collateral. For operating leases, lease liabilities were discounted at the Company's weighted average incremental secured borrowing rate for similar collateral estimated to be 5.6% and the weighted average lease term is 9.7 years. For finance leases, lease liabilities were discounted at a weighted average rate implicit in the lease of 5.5% and the weighted average lease term is 98.2 years. Right-of-use assets for finance leases are amortized on a straight-line basis over the term of the lease and are recorded in "Depreciation and amortization" in the Company's consolidated statements of operations. During the three and nine months ended September 30, 2019, the Company recognized $1.7 million and $3.0 million, respectively, in "Interest expense" and $0.3 million and $0.5 million, respectively, in "Depreciation and amortization" in its consolidated statement of operations relating to finance leases. For operating leases, rent expense is recognized on a straight-line basis over the term of the lease and is recorded in "General and administrative" and "Real estate expense" in the Company's consolidated statements of operations (refer to Note 3). During the three and nine months ended September 30, 2019, the Company recognized $0.9 million and $2.8 million, respectively, in "General and administrative" and $0.9 million and $2.6 million, respectively, in "Real estate expense" in its consolidated statement of operations relating to operating leases.
|
(3)
|
Other assets primarily includes derivative assets, prepaid expenses and deposits for certain real estate assets.
|
(4)
|
As of December 31, 2018, includes $26.0 million of reimbursements receivable related to the construction and development of an operating property that was received in 2019. As of September 30, 2019, includes $21.2 million of receivables held in escrow.
|
(5)
|
Accumulated amortization of leasing costs was $3.4 million and $4.4 million as of September 30, 2019 and December 31, 2018, respectively.
|
(6)
|
Accumulated depreciation on corporate furniture, fixtures and equipment was $12.8 million and $11.9 million as of September 30, 2019 and December 31, 2018, respectively.
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
Other liabilities(1)
|
$
|
85,273
|
|
|
143,325
|
|
|
Accrued expenses
|
85,408
|
|
|
95,149
|
|
||
Finance lease liabilities (see table above)
|
147,064
|
|
|
—
|
|
||
Intangible liabilities, net(2)
|
49,185
|
|
|
35,108
|
|
||
Operating lease liabilities (see table above)
|
27,830
|
|
|
—
|
|
||
Accrued interest payable
|
23,916
|
|
|
42,669
|
|
||
Accounts payable, accrued expenses and other liabilities
|
$
|
418,676
|
|
|
$
|
316,251
|
|
(1)
|
As of September 30, 2019 and December 31, 2018, other liabilities includes $0.2 million and $18.5 million, respectively, related to profit sharing arrangements with developers for certain properties sold. As of September 30, 2019 and December 31, 2018, other liabilities also includes $6.8 million and $9.4 million, respectively, related to tax increment financing bonds which were issued by government entities to fund development within two of the Company's land projects. The amount represents tax assessments associated with each project, which will decrease as the Company sells units.
|
(2)
|
Intangible liabilities, net includes below market lease liabilities related to the acquisition of real estate assets. Accumulated amortization on below market lease liabilities was $4.5 million and $2.8 million as of September 30, 2019 and December 31, 2018, respectively. The amortization of below market leases increased operating lease income in the Company's consolidated statements of operations by $0.7 million and $1.8 million for the three and nine months ended September 30, 2019, respectively, and $3.1 million and $3.4 million for the three and nine months ended September 30, 2018, respectively.
|
|
|
Carrying Value as of
|
||||||
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Loan participations payable(1)
|
|
$
|
33,189
|
|
|
$
|
22,642
|
|
Debt discounts and deferred financing costs, net
|
|
(54
|
)
|
|
(158
|
)
|
||
Total loan participations payable, net
|
|
$
|
33,135
|
|
|
$
|
22,484
|
|
(1)
|
As of September 30, 2019 and December 31, 2018, the Company had one loan participation payable with an interest rate of 6.5%.
|
|
Carrying Value as of
|
|
Stated
Interest Rates |
|
Scheduled
Maturity Date |
|||||||
|
September 30, 2019
|
|
December 31, 2018
|
|
|
|||||||
Secured credit facilities and mortgages:
|
|
|
|
|
|
|
|
|||||
2015 $350 million Revolving Credit Facility
|
$
|
—
|
|
|
$
|
—
|
|
|
LIBOR + 2.25%
|
|
(1)
|
September 2022
|
2016 Senior Term Loan
|
641,875
|
|
|
646,750
|
|
|
LIBOR + 2.75%
|
|
(2)
|
June 2023
|
||
Mortgages collateralized by net lease assets(3)
|
724,651
|
|
|
802,367
|
|
|
3.62% - 7.26%
|
|
(3)
|
|
||
Total secured credit facilities and mortgages
|
1,366,526
|
|
|
1,449,117
|
|
|
|
|
|
|
||
Unsecured notes:
|
|
|
|
|
|
|
|
|||||
5.00% senior notes(4)
|
—
|
|
|
375,000
|
|
|
5.00
|
%
|
|
—
|
||
4.625% senior notes(5)
|
400,000
|
|
|
400,000
|
|
|
4.625
|
%
|
|
—
|
||
6.50% senior notes(6)
|
275,000
|
|
|
275,000
|
|
|
6.50
|
%
|
|
—
|
||
6.00% senior notes(7)
|
375,000
|
|
|
375,000
|
|
|
6.00
|
%
|
|
April 2022
|
||
5.25% senior notes(8)
|
400,000
|
|
|
400,000
|
|
|
5.25
|
%
|
|
September 2022
|
||
3.125% senior convertible notes(9)
|
287,500
|
|
|
287,500
|
|
|
3.125
|
%
|
|
September 2022
|
||
4.75% senior notes(10)
|
675,000
|
|
|
—
|
|
|
4.75
|
%
|
|
October 2024
|
||
Total unsecured notes
|
2,412,500
|
|
|
2,112,500
|
|
|
|
|
|
|
||
Other debt obligations:
|
|
|
|
|
|
|
|
|||||
Trust preferred securities
|
100,000
|
|
|
100,000
|
|
|
LIBOR + 1.50%
|
|
|
October 2035
|
||
Total debt obligations
|
3,879,026
|
|
|
3,661,617
|
|
|
|
|
|
|
||
Debt discounts and deferred financing costs, net
|
(51,667
|
)
|
|
(52,531
|
)
|
|
|
|
|
|
||
Total debt obligations, net(11)
|
$
|
3,827,359
|
|
|
$
|
3,609,086
|
|
|
|
|
|
|
(1)
|
The loan bears interest at the Company's election of either: (i) a base rate, which is the greater of (a) prime, (b) federal funds plus 0.50% or (c) LIBOR plus 1.0% and subject to a margin ranging from 1.00% to 1.50%; or (ii) LIBOR subject to a margin ranging from 2.00% to 2.50%. At maturity, the Company may convert outstanding borrowings to a one year term loan which matures in quarterly installments through September 2023.
|
(2)
|
The loan bears interest at the Company's election of either: (i) a base rate, which is the greater of (a) prime, (b) federal funds plus 0.5% or (c) LIBOR plus 1.0% and subject to a margin of 1.75%; or (ii) LIBOR subject to a margin of 2.75%.
|
(3)
|
In June 2019, the buyer of a portfolio of net lease assets assumed a $228.0 million non-recourse mortgage (refer to Note 4). As of September 30, 2019, the weighted average interest rate of these loans is 4.4%, inclusive of the effect of interest rate swaps.
|
(4)
|
The Company prepaid these senior notes in March 2019 without penalty.
|
(5)
|
The Company prepaid these senior notes in October 2019 with a $6.0 million prepayment penalty.
|
(6)
|
The Company prepaid these senior notes in October 2019 with a $4.5 million prepayment penalty.
|
(7)
|
The Company can prepay these senior notes without penalty beginning April 1, 2021.
|
(8)
|
The Company can prepay these senior notes without penalty beginning September 15, 2021.
|
(9)
|
The Company's 3.125% senior convertible fixed rate notes due September 2022 ("3.125% Convertible Notes") are convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding September 15, 2022. The conversion rate as of September 30, 2019 was 67.3711 shares per $1,000 principal amount of 3.125% Convertible Notes, which equals a conversion price of $14.84 per share. The conversion rate is subject to adjustment from time to time for specified events. Upon conversion, the Company will pay or deliver, as the case may be, a combination of cash and shares of its common stock. As such, at issuance in September 2017, the Company valued the debt component at $221.8 million, net of fees, and the equity component of the conversion feature at $22.5 million, net of fees, and recorded the equity component in "Additional paid-in capital" on the Company's consolidated balance sheet. In October 2017, the initial purchasers of the 3.125% Convertible Notes exercised their option to purchase an additional $37.5 million aggregate principal amount of the 3.125% Convertible Notes. At issuance, the Company valued the debt component at $34.0 million, net of fees, and the equity component of the conversion feature at $3.4 million, net of fees, and recorded the equity component in "Additional paid-in capital" on the Company's consolidated balance sheet. As of September 30, 2019, the carrying value of the 3.125% Convertible Notes was $267.1 million, net of fees, and the unamortized discount of the 3.125% Convertible Notes was $16.8 million, net of fees. During the three and nine months ended September 30, 2019, the Company recognized $2.2 million and $6.7 million, respectively, of contractual interest and $1.3 million and $3.7 million, respectively, of discount amortization on the 3.125% Convertible Notes. During the three and nine months ended September 30, 2018, the Company recognized $2.2 million and $6.7 million, respectively, of contractual interest and $1.2 million and $3.5 million, respectively, of discount amortization on the 3.125% Convertible Notes. The effective interest rate was 5.2%.
|
(10)
|
The Company can prepay these senior notes without penalty beginning July 1, 2024.
|
(11)
|
The Company capitalized interest relating to development activities of $0.5 million and $6.9 million during the three and nine months ended September 30, 2019, respectively, and $4.0 million and $8.5 million during the three and nine months ended September 30, 2018, respectively..
|
|
Unsecured Debt
|
|
Secured Debt
|
|
Total
|
||||||
2019 (remaining three months)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2020(1)
|
400,000
|
|
|
—
|
|
|
400,000
|
|
|||
2021(1)
|
275,000
|
|
|
159,802
|
|
|
434,802
|
|
|||
2022
|
1,062,500
|
|
|
48,174
|
|
|
1,110,674
|
|
|||
2023
|
—
|
|
|
641,875
|
|
|
641,875
|
|
|||
Thereafter
|
775,000
|
|
|
516,675
|
|
|
1,291,675
|
|
|||
Total principal maturities
|
2,512,500
|
|
|
1,366,526
|
|
|
3,879,026
|
|
|||
Unamortized discounts and deferred financing costs, net
|
(42,487
|
)
|
|
(9,180
|
)
|
|
(51,667
|
)
|
|||
Total debt obligations, net
|
$
|
2,470,013
|
|
|
$
|
1,357,346
|
|
|
$
|
3,827,359
|
|
(1)
|
The $400.0 million principal amount outstanding of the 4.625% senior unsecured notes due September 2020 and the $275.0 million principal amount outstanding of the 6.50% senior unsecured notes due July 2021 were repaid in full in October 2019.
|
|
As of
|
||||||||||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Collateral Assets(1)
|
|
Non-Collateral Assets
|
|
Collateral Assets(1)
|
|
Non-Collateral Assets
|
||||||||
Real estate, net
|
$
|
1,413,531
|
|
|
$
|
116,585
|
|
|
$
|
1,620,008
|
|
|
$
|
151,011
|
|
Real estate available and held for sale
|
—
|
|
|
12,688
|
|
|
1,055
|
|
|
21,496
|
|
||||
Net investment in leases
|
421,252
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Land and development, net
|
42,402
|
|
|
567,978
|
|
|
12,300
|
|
|
585,918
|
|
||||
Loans receivable and other lending investments, net(2)(3)
|
308,474
|
|
|
475,374
|
|
|
498,524
|
|
|
480,154
|
|
||||
Other investments
|
—
|
|
|
733,793
|
|
|
—
|
|
|
304,275
|
|
||||
Cash and other assets
|
2,645
|
|
|
1,460,795
|
|
|
—
|
|
|
1,329,990
|
|
||||
Total
|
$
|
2,188,304
|
|
|
$
|
3,367,213
|
|
|
$
|
2,131,887
|
|
|
$
|
2,872,844
|
|
(1)
|
The 2016 Senior Term Loan and the 2015 Revolving Credit Facility are secured only by pledges of equity of certain of the Company's subsidiaries and not by pledges of the assets held by such subsidiaries. Such subsidiaries are subject to contractual restrictions under the terms of such credit facilities, including restrictions on incurring new debt (subject to certain exceptions). As of September 30, 2019, Collateral Assets includes $412.0 million carrying value of assets held by entities pledged as collateral for the 2015 Revolving Credit Facility that is undrawn as of September 30, 2019.
|
(2)
|
As of September 30, 2019 and December 31, 2018, the amounts presented exclude general reserves for loan losses of $8.7 million and $13.0 million, respectively.
|
(3)
|
As of September 30, 2019 and December 31, 2018, the amounts presented exclude loan participations of $33.1 million and $22.5 million, respectively.
|
|
Loans and Other Lending Investments(1)
|
|
Real Estate(2)
|
|
Other
Investments
|
|
Total
|
||||||||
Performance-Based Commitments
|
$
|
294,059
|
|
|
$
|
77,251
|
|
|
$
|
—
|
|
|
$
|
371,310
|
|
Strategic Investments
|
—
|
|
|
—
|
|
|
24,177
|
|
|
24,177
|
|
||||
Total
|
$
|
294,059
|
|
|
$
|
77,251
|
|
|
$
|
24,177
|
|
|
$
|
395,487
|
|
(1)
|
Excludes $16.8 million of commitments on loan participations sold that are not the obligation of the Company.
|
(2)
|
Includes a commitment to invest up to $55.0 million in additional bowling centers over the next several years (refer to Note 5).
|
|
Operating(1)(2)
|
|
Finance(1)
|
||||
2019 (remaining three months)
|
$
|
1,079
|
|
|
$
|
1,330
|
|
2020
|
4,054
|
|
|
5,386
|
|
||
2021
|
1,468
|
|
|
5,494
|
|
||
2022
|
869
|
|
|
5,604
|
|
||
2023
|
728
|
|
|
5,716
|
|
||
Thereafter
|
2,074
|
|
|
1,579,655
|
|
||
Total undiscounted cash flows
|
10,272
|
|
|
1,603,185
|
|
||
Present value discount(1)
|
(1,141
|
)
|
|
(1,456,121
|
)
|
||
Other adjustments(2)
|
18,699
|
|
|
—
|
|
||
Lease liabilities
|
$
|
27,830
|
|
|
$
|
147,064
|
|
(1)
|
During the three and nine months ended September 30, 2019, the Company made payments of $1.0 million and $3.0 million, respectively, related to its operating leases and $1.1 million and $2.0 million, respectively, related to its finance leases (refer to Note 4). The weighted average lease term for the Company's operating leases, excluding operating leases for which the Company's tenants pay rent on its behalf, was 4.2 years and the weighted average discount rate was 5.6%. The weighted average lease term for the Company's finance leases was 98.2 years and the weighted average discount rate was 5.5%.
|
(2)
|
The Company is obligated to pay ground rent under certain operating leases; however, the Company's tenants at the properties pay this expense directly under the terms of various subleases and these amounts are excluded from lease obligations. The amount shown above is the net present value of the payments to be made by the Company's tenants on its behalf.
|
|
Operating(1)
|
||
2019
|
$
|
4,340
|
|
2020
|
4,016
|
|
|
2021
|
1,589
|
|
|
2022
|
991
|
|
|
2023
|
849
|
|
|
Thereafter
|
2,469
|
|
(1)
|
The Company is obligated to pay ground rent under certain operating leases; however, the Company's tenants at the properties pay this expense directly under the terms of various subleases and these amounts are excluded from lease obligations.
|
|
|
Derivative Assets
|
|
Derivative Liabilities
|
||||||||
As of December 31, 2018
|
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Derivatives Designated in Hedging Relationships
|
|
|
|
|
||||||||
Interest rate swaps
|
|
Deferred expenses and other assets, net
|
|
$
|
3,669
|
|
|
Accounts payable, accrued expenses and other liabilities
|
|
$
|
10,244
|
|
Total
|
|
|
|
$
|
3,669
|
|
|
|
|
$
|
10,244
|
|
(1)
|
Over the next 12 months, the Company expects that $4.8 million related to cash flow hedges will be reclassified from "Accumulated other comprehensive income (loss)" as a reduction to interest expense. As of December 31, 2018, the Company posted cash collateral of $6.4 million in connection with its derivatives which were in a liability position and would not have been required to post any additional collateral to settle these contracts had the Company been declared in default on its derivative obligations.
|
Derivatives Designated in Hedging Relationships
|
|
Location of Gain (Loss)
When Recognized in Income
|
|
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income
|
|
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Earnings
|
||||
For the Three Months Ended September 30, 2019
|
|
|
|
|
||||||
Interest rate swaps
|
|
Earnings from equity method investments
|
|
$
|
(6,082
|
)
|
|
$
|
(126
|
)
|
Interest rate swaps
|
|
Interest expense
|
|
(3,009
|
)
|
|
(539
|
)
|
||
|
|
|
|
|
|
|
||||
For the Three Months Ended September 30, 2018
|
|
|
|
|
||||||
Interest rate swaps
|
|
Interest Expense
|
|
2,702
|
|
|
(144
|
)
|
||
Interest rate swaps
|
|
Earnings from equity method investments
|
|
1,197
|
|
|
44
|
|
||
|
|
|
|
|
|
|
||||
For the Nine Months Ended September 30, 2019
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
Earnings from equity method investments
|
|
(21,309
|
)
|
|
28
|
|
||
Interest rate swaps
|
|
Interest expense
|
|
(23,781
|
)
|
|
(957
|
)
|
||
|
|
|
|
|
|
|
||||
For the Nine Months Ended September 30, 2018
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
Interest Expense
|
|
1,552
|
|
|
(144
|
)
|
||
Interest rate swaps
|
|
Earnings from equity method investments
|
|
4,705
|
|
|
(47
|
)
|
|
|
|
|
|
|
Cumulative Preferential Cash
Dividends(1)(2)
|
|
|
||||||||||||||
Series
|
|
Shares Issued and
Outstanding
(in thousands)
|
|
Par Value
|
|
Liquidation Preference(3)(4)
|
|
Rate per Annum
|
|
Annual
Dividend Per Share
|
|
Carrying Value
(in thousands)
|
||||||||||
D
|
|
4,000
|
|
|
$
|
0.001
|
|
|
$
|
25.00
|
|
|
8.00
|
%
|
|
$
|
2.00
|
|
|
$
|
89,041
|
|
G
|
|
3,200
|
|
|
0.001
|
|
|
25.00
|
|
|
7.65
|
%
|
|
1.91
|
|
|
72,664
|
|
||||
I
|
|
5,000
|
|
|
0.001
|
|
|
25.00
|
|
|
7.50
|
%
|
|
1.88
|
|
|
120,785
|
|
||||
J (convertible)(4)
|
|
4,000
|
|
|
0.001
|
|
|
50.00
|
|
|
4.50
|
%
|
|
2.25
|
|
|
193,510
|
|
||||
|
|
16,200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
476,000
|
|
(1)
|
Holders of shares of the Series D, G, I and J preferred stock are entitled to receive dividends, when and as declared by the Company's Board of Directors, out of funds legally available for the payment of dividends. Dividends are cumulative from the date of original issue and are payable quarterly in arrears on or before the 15th day of each March, June, September and December or, if not a business day, the next succeeding business day. Any dividend payable on the preferred stock for any partial dividend period will be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends will be payable to holders of record as of the close of business on the first day of the calendar month in which the applicable dividend payment date falls or on another date designated by the Company's Board of Directors for the payment of dividends that is not more than 30 nor less than 10 days prior to the dividend payment date.
|
(2)
|
The Company declared and paid dividends of $6.0 million, $4.6 million and $7.0 million on its Series D, G and I Cumulative Redeemable Preferred Stock during the nine months ended September 30, 2019 and 2018, respectively. The Company declared and paid dividends of $6.8 million on its Series J Convertible Perpetual Preferred Stock during the nine months ended September 30, 2019 and 2018. The character of the 2018 dividends was 100% capital gain distribution, of which 26.02% represented unrecaptured section 1250 gain and 73.98% represented long term capital gain. There are no dividend arrearages on any of the preferred shares currently outstanding.
|
(3)
|
The Company may, at its option, redeem the Series G and I Preferred Stock, in whole or in part, at any time and from time to time, for cash at a redemption price equal to 100% of the liquidation preference of $25.00 per share, plus accrued and unpaid dividends, if any, to the redemption date.
|
(4)
|
Each share of the Series J Preferred Stock is convertible at the holder's option at any time into shares of the Company's common stock. The Company may, at its option, redeem the Series J Preferred Stock, in whole or in part, at any time and from time to time, for cash at a redemption price equal to 100% of the liquidation preference of $50.00 per share, plus accrued and unpaid dividends, if any, to the redemption date. The conversion rate as of September 30, 2019 was 4.0918 shares of the Company's common stock (equal to a conversion price of approximately $12.22 per share). The conversion rate is subject to adjustment from time to time for specified events.
|
|
As of
|
||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||
Unrealized gains on available-for-sale securities
|
$
|
2,962
|
|
|
$
|
475
|
|
Unrealized losses on cash flow hedges
|
(39,285
|
)
|
|
(13,546
|
)
|
||
Unrealized losses on cumulative translation adjustment
|
(4,199
|
)
|
|
(4,199
|
)
|
||
Accumulated other comprehensive loss
|
$
|
(40,522
|
)
|
|
$
|
(17,270
|
)
|
|
iPIP Investment Pool
|
|||||||
|
2013-2014
|
|
2015-2016
|
|
2017-2018
|
|||
Points at beginning of period
|
85.77
|
|
|
79.41
|
|
|
82.43
|
|
Granted
|
—
|
|
|
—
|
|
|
—
|
|
Forfeited
|
(1.60
|
)
|
|
(2.73
|
)
|
|
(3.72
|
)
|
Points at end of period
|
84.17
|
|
|
76.68
|
|
|
78.71
|
|
Nonvested at beginning of period
|
357
|
|
Granted
|
481
|
|
Vested
|
(52
|
)
|
Forfeited
|
(89
|
)
|
Nonvested at end of period
|
697
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income (loss)
|
$
|
3,626
|
|
|
$
|
(8,832
|
)
|
|
$
|
370,347
|
|
|
$
|
86,702
|
|
Net income attributable to noncontrolling interests
|
(2,845
|
)
|
|
(2,028
|
)
|
|
(8,168
|
)
|
|
(11,632
|
)
|
||||
Preferred dividends
|
(8,124
|
)
|
|
(8,124
|
)
|
|
(24,372
|
)
|
|
(24,372
|
)
|
||||
Net income (loss) allocable to common shareholders for basic earnings per common share
|
$
|
(7,343
|
)
|
|
$
|
(18,984
|
)
|
|
$
|
337,807
|
|
|
$
|
50,698
|
|
Add: Effect of Series J convertible perpetual preferred stock
|
—
|
|
|
—
|
|
|
6,750
|
|
|
6,750
|
|
||||
Net income (loss) allocable to common shareholders for diluted earnings per common share
|
$
|
(7,343
|
)
|
|
$
|
(18,984
|
)
|
|
$
|
344,557
|
|
|
$
|
57,448
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Earnings allocable to common shares:
|
|
|
|
|
|
|
|
||||||||
Numerator for basic earnings per share:
|
|
|
|
|
|
|
|
||||||||
Net income (loss) allocable to common shareholders
|
$
|
(7,343
|
)
|
|
$
|
(18,984
|
)
|
|
$
|
337,807
|
|
|
$
|
50,698
|
|
|
|
|
|
|
|
|
|
||||||||
Numerator for diluted earnings per share:
|
|
|
|
|
|
|
|
||||||||
Net income (loss) allocable to common shareholders
|
$
|
(7,343
|
)
|
|
$
|
(18,984
|
)
|
|
$
|
344,557
|
|
|
$
|
57,448
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator for basic and diluted earnings per share:
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding for basic earnings per common share
|
62,168
|
|
|
67,975
|
|
|
64,624
|
|
|
67,940
|
|
||||
Add: Effect of assumed shares issued under treasury stock method for restricted stock units
|
—
|
|
|
—
|
|
|
114
|
|
|
131
|
|
||||
Add: Effect of series J convertible perpetual preferred stock
|
—
|
|
|
—
|
|
|
16,138
|
|
|
15,658
|
|
||||
Weighted average common shares outstanding for diluted earnings per common share
|
62,168
|
|
|
67,975
|
|
|
80,876
|
|
|
83,729
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Net income (loss) allocable to common shareholders
|
$
|
(0.12
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
5.23
|
|
|
$
|
0.75
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per common share:(1)
|
|
|
|
|
|
|
|
||||||||
Net income (loss) allocable to common shareholders
|
$
|
(0.12
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
4.26
|
|
|
$
|
0.69
|
|
(1)
|
For the three months ended September 30, 2019 and 2018, 16,306 and 15,703, respectively of Series J convertible perpetual preferred stock was anti-dilutive. For the three and nine months ended September 30, 2019 and the three months ended September 30, 2018, the effect of certain of the Company's restricted stock awards were anti-dilutive. The Company will settle conversions of the 3.125% Convertible Notes (refer to Note 11) by paying the conversion value in cash up to the original principal amount of the notes being converted and shares of common stock to the extent of any conversion premium. The amount of cash and shares of common stock, if any, due upon conversion will be based on a daily conversion value calculated for each trading day in a 40 consecutive day observation period. Based upon the conversion price of the 3.125% Convertible Notes, no shares of common stock would have been issuable upon conversion of the 3.125% Convertible Notes for the three and nine months ended September 30, 2019 and therefore the 3.125% Convertible Notes had no effect on diluted EPS for such periods.
|
|
|
|
Fair Value Using
|
||||||||||||
|
Total
|
|
Quoted market
prices in
active markets
(Level 1)
|
|
Significant other
observable
inputs
(Level 2)
|
|
Significant
unobservable
inputs
(Level 3)
|
||||||||
As of September 30, 2019
|
|
|
|
|
|
|
|
||||||||
Recurring basis:
|
|
|
|
|
|
|
|
||||||||
Derivative assets(1)
|
$
|
94
|
|
|
$
|
—
|
|
|
$
|
94
|
|
|
$
|
—
|
|
Derivative liabilities(1)
|
11,572
|
|
|
—
|
|
|
11,572
|
|
|
—
|
|
||||
Available-for-sale securities(1)
|
24,102
|
|
|
—
|
|
|
—
|
|
|
24,102
|
|
||||
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Recurring basis:
|
|
|
|
|
|
|
|
||||||||
Derivative assets(1)
|
$
|
3,669
|
|
|
$
|
—
|
|
|
$
|
3,669
|
|
|
$
|
—
|
|
Derivative liabilities(1)
|
10,244
|
|
|
—
|
|
|
10,244
|
|
|
—
|
|
||||
Available-for-sale securities(1)
|
21,661
|
|
|
—
|
|
|
—
|
|
|
21,661
|
|
||||
Non-recurring basis:
|
|
|
|
|
|
|
|
||||||||
Impaired real estate(2)
|
29,400
|
|
|
—
|
|
|
—
|
|
|
29,400
|
|
||||
Impaired real estate available and held for sale(3)
|
19,300
|
|
|
—
|
|
|
—
|
|
|
19,300
|
|
||||
Impaired land and development(4)
|
78,400
|
|
|
—
|
|
|
—
|
|
|
78,400
|
|
(1)
|
The fair value of the Company's derivatives are based upon widely accepted valuation techniques utilized by a third-party specialist using observable inputs such as interest rates and contractual cash flow and are classified as Level 2. The fair value of the Company's available-for-sale securities are based upon unadjusted third-party broker quotes and are classified as Level 3.
|
(2)
|
The Company recorded aggregate impairments of $76.3 million on three real estate assets with an estimated aggregate fair value of $29.4 million. The impairments were as follows:
|
a.
|
A $23.2 million impairment on a commercial operating property based on a decline in expected operating performance. The fair value is based on the Company's estimate of the recoverability of its investment in the project.
|
b.
|
A $6.0 million impairment on a property based on a strategic decision to sell the asset. The fair value is based on purchase offers received from third parties, which is consistent with the Company's estimate of fair value.
|
c.
|
A $47.1 million impairment on a commercial operating property based on a strategic decision to sell the asset. The fair value is based on purchase offers received from third parties, which is consistent with the Company's estimate of fair value.
|
(3)
|
The Company recorded aggregate impairments of $3.7 million on two real estate assets held for sale. The fair values are based on market comparable sales.
|
(4)
|
The Company recorded aggregate impairments of $55.4 million on four land and development assets with an estimated aggregate fair value of $78.4 million. The impairments were as follows:
|
a.
|
A $25.0 million impairment on a waterfront land and development asset based on a strategic decision to sell the asset. The fair value is based on purchase offers received from third parties, which is consistent with the Company's estimate of fair value.
|
b.
|
A $21.6 million impairment on a master planned community based on a strategic decision to sell the asset. The fair value is based on purchase offers received from third parties, which is consistent with the Company's estimate of fair value.
|
c.
|
A $6.9 million impairment on an infill land and development asset based on the deterioration of the asset. The fair value is based on purchase offers received from third parties, which is consistent with the Company's estimate of fair value.
|
d.
|
A $1.9 million impairment on a waterfront land and development asset based on the sale of the asset in 2019.
|
|
|
2019
|
|
2018
|
||||
Beginning balance
|
|
$
|
21,661
|
|
|
$
|
22,842
|
|
Repayments
|
|
(45
|
)
|
|
(46
|
)
|
||
Unrealized gains (losses) recorded in other comprehensive income
|
|
2,486
|
|
|
(1,514
|
)
|
||
Ending balance
|
|
$
|
24,102
|
|
|
$
|
21,282
|
|
|
Real Estate Finance
|
|
Net Lease
|
|
Operating Properties
|
|
Land and Development
|
|
Corporate/Other(1)
|
|
Company Total
|
||||||||||||
Nine Months Ended September 30, 2019:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Operating lease income
|
$
|
—
|
|
|
$
|
136,150
|
|
|
$
|
21,844
|
|
|
$
|
216
|
|
|
$
|
—
|
|
|
$
|
158,210
|
|
Interest income
|
59,220
|
|
|
1,197
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
60,417
|
|
||||||
Interest income from sales-type leases
|
—
|
|
|
12,157
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,157
|
|
||||||
Other income
|
2,836
|
|
|
12,705
|
|
|
13,960
|
|
|
6,877
|
|
|
6,755
|
|
|
43,133
|
|
||||||
Land development revenue
|
—
|
|
|
—
|
|
|
—
|
|
|
76,691
|
|
|
—
|
|
|
76,691
|
|
||||||
Earnings (losses) from equity method investments
|
—
|
|
|
13,660
|
|
|
(166
|
)
|
|
2,910
|
|
|
162
|
|
|
16,566
|
|
||||||
Selling profit from sales-type leases
|
—
|
|
|
180,416
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
180,416
|
|
||||||
Income from sales of real estate
|
—
|
|
|
223,200
|
|
|
10,206
|
|
|
—
|
|
|
—
|
|
|
233,406
|
|
||||||
Total revenue and other earnings
|
62,056
|
|
|
579,485
|
|
|
45,844
|
|
|
86,694
|
|
|
6,917
|
|
|
780,996
|
|
||||||
Real estate expense
|
—
|
|
|
(18,335
|
)
|
|
(28,646
|
)
|
|
(24,184
|
)
|
|
—
|
|
|
(71,165
|
)
|
||||||
Land development cost of sales
|
—
|
|
|
—
|
|
|
—
|
|
|
(71,785
|
)
|
|
—
|
|
|
(71,785
|
)
|
||||||
Other expense
|
(359
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,439
|
)
|
|
(12,798
|
)
|
||||||
Allocated interest expense
|
(23,251
|
)
|
|
(70,548
|
)
|
|
(7,859
|
)
|
|
(15,888
|
)
|
|
(19,305
|
)
|
|
(136,851
|
)
|
||||||
Allocated general and administrative(2)
|
(6,523
|
)
|
|
(19,299
|
)
|
|
(2,214
|
)
|
|
(9,199
|
)
|
|
(14,583
|
)
|
|
(51,818
|
)
|
||||||
Segment profit (loss)(3)
|
$
|
31,923
|
|
|
$
|
471,303
|
|
|
$
|
7,125
|
|
|
$
|
(34,362
|
)
|
|
$
|
(39,410
|
)
|
|
$
|
436,579
|
|
Other significant non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Recovery of loan losses
|
$
|
(3,792
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3,792
|
)
|
Impairment of assets
|
—
|
|
|
—
|
|
|
3,853
|
|
|
1,100
|
|
|
—
|
|
|
4,953
|
|
||||||
Depreciation and amortization
|
—
|
|
|
38,242
|
|
|
3,701
|
|
|
733
|
|
|
910
|
|
|
43,586
|
|
||||||
Capitalized expenditures
|
—
|
|
|
12,707
|
|
|
4,878
|
|
|
86,029
|
|
|
—
|
|
|
103,614
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended September 30, 2018:
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Operating lease income
|
$
|
—
|
|
|
$
|
104,241
|
|
|
$
|
44,818
|
|
|
$
|
457
|
|
|
$
|
—
|
|
|
$
|
149,516
|
|
Interest income
|
74,824
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
74,824
|
|
||||||
Other income
|
4,271
|
|
|
2,755
|
|
|
46,748
|
|
|
2,640
|
|
|
7,537
|
|
|
63,951
|
|
||||||
Land development revenue
|
—
|
|
|
—
|
|
|
—
|
|
|
369,665
|
|
|
—
|
|
|
369,665
|
|
||||||
Earnings (losses) from equity method investments
|
—
|
|
|
7,028
|
|
|
(4,814
|
)
|
|
2,726
|
|
|
(9,521
|
)
|
|
(4,581
|
)
|
||||||
Gain from consolidation of equity method investment
|
—
|
|
|
67,877
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,877
|
|
||||||
Income from sales of real estate
|
—
|
|
|
24,907
|
|
|
54,446
|
|
|
—
|
|
|
—
|
|
|
79,353
|
|
||||||
Total revenue and other earnings
|
79,095
|
|
|
206,808
|
|
|
141,198
|
|
|
375,488
|
|
|
(1,984
|
)
|
|
800,605
|
|
||||||
Real estate expense
|
—
|
|
|
(12,186
|
)
|
|
(64,091
|
)
|
|
(29,234
|
)
|
|
—
|
|
|
(105,511
|
)
|
||||||
Land development cost of sales
|
—
|
|
|
—
|
|
|
—
|
|
|
(318,881
|
)
|
|
—
|
|
|
(318,881
|
)
|
||||||
Other expense
|
(869
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,311
|
)
|
|
(5,180
|
)
|
||||||
Allocated interest expense
|
(31,971
|
)
|
|
(44,246
|
)
|
|
(14,653
|
)
|
|
(16,795
|
)
|
|
(27,907
|
)
|
|
(135,572
|
)
|
||||||
Allocated general and administrative(2)
|
(10,514
|
)
|
|
(15,179
|
)
|
|
(5,447
|
)
|
|
(11,128
|
)
|
|
(15,142
|
)
|
|
(57,410
|
)
|
||||||
Segment profit (loss)(3)
|
$
|
35,741
|
|
|
$
|
135,197
|
|
|
$
|
57,007
|
|
|
$
|
(550
|
)
|
|
$
|
(49,344
|
)
|
|
$
|
178,051
|
|
Other significant non-cash items:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for loan losses
|
$
|
18,237
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18,237
|
|
Impairment of assets
|
—
|
|
|
4,342
|
|
|
5,535
|
|
|
1,300
|
|
|
—
|
|
|
11,177
|
|
||||||
Depreciation and amortization
|
—
|
|
|
25,205
|
|
|
14,522
|
|
|
1,095
|
|
|
1,035
|
|
|
41,857
|
|
||||||
Capitalized expenditures
|
—
|
|
|
29,512
|
|
|
18,186
|
|
|
107,658
|
|
|
—
|
|
|
155,356
|
|
|
Real Estate Finance
|
|
Net Lease
|
|
Operating Properties
|
|
Land and Development
|
|
Corporate/Other(1)
|
|
Company Total
|
||||||||||||
As of September 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Real estate, net
|
$
|
—
|
|
|
$
|
1,329,896
|
|
|
$
|
200,220
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,530,116
|
|
Real estate available and held for sale
|
—
|
|
|
—
|
|
|
12,688
|
|
|
—
|
|
|
—
|
|
|
12,688
|
|
||||||
Total real estate
|
—
|
|
|
1,329,896
|
|
|
212,908
|
|
|
—
|
|
|
—
|
|
|
1,542,804
|
|
||||||
Net investment in leases
|
—
|
|
|
421,252
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
421,252
|
|
||||||
Land and development, net
|
—
|
|
|
—
|
|
|
—
|
|
|
610,380
|
|
|
—
|
|
|
610,380
|
|
||||||
Loans receivable and other lending investments, net
|
764,055
|
|
|
44,234
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
808,289
|
|
||||||
Other investments
|
—
|
|
|
586,358
|
|
|
60,347
|
|
|
42,675
|
|
|
44,413
|
|
|
733,793
|
|
||||||
Total portfolio assets
|
$
|
764,055
|
|
|
$
|
2,381,740
|
|
|
$
|
273,255
|
|
|
$
|
653,055
|
|
|
$
|
44,413
|
|
|
4,116,518
|
|
|
Cash and other assets
|
|
|
|
|
|
|
|
|
|
|
1,463,440
|
|
|||||||||||
Total assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5,579,958
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Real estate, net
|
$
|
—
|
|
|
$
|
1,536,494
|
|
|
$
|
234,525
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,771,019
|
|
Real estate available and held for sale
|
—
|
|
|
1,055
|
|
|
21,496
|
|
|
—
|
|
|
—
|
|
|
22,551
|
|
||||||
Total real estate
|
—
|
|
|
1,537,549
|
|
|
256,021
|
|
|
—
|
|
|
—
|
|
|
1,793,570
|
|
||||||
Land and development, net
|
—
|
|
|
—
|
|
|
—
|
|
|
598,218
|
|
|
—
|
|
|
598,218
|
|
||||||
Loans receivable and other lending investments, net
|
988,224
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
988,224
|
|
||||||
Other investments
|
—
|
|
|
165,804
|
|
|
65,643
|
|
|
65,312
|
|
|
7,516
|
|
|
304,275
|
|
||||||
Total portfolio assets
|
$
|
988,224
|
|
|
$
|
1,703,353
|
|
|
$
|
321,664
|
|
|
$
|
663,530
|
|
|
$
|
7,516
|
|
|
3,684,287
|
|
|
Cash and other assets
|
|
|
|
|
|
|
|
|
|
|
1,329,990
|
|
|||||||||||
Total assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5,014,277
|
|
(1)
|
Corporate/Other represents all corporate level and unallocated items including any intercompany eliminations necessary to reconcile to consolidated Company totals. This caption also includes the Company's joint venture investments and strategic investments that are not included in the other reportable segments above.
|
(2)
|
General and administrative excludes stock-based compensation expense of $6.7 million and $20.7 million for the three and nine months ended September 30, 2019, respectively, and $3.7 million and $16.2 million for the three and nine months ended September 30, 2018, respectively.
|
(3)
|
The following is a reconciliation of segment profit to net income (loss) ($ in thousands):
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Segment profit
|
$
|
20,844
|
|
|
$
|
17,035
|
|
|
$
|
436,579
|
|
|
$
|
178,051
|
|
Add/Less: Recovery of (provision for) loan losses
|
3,805
|
|
|
(200
|
)
|
|
3,792
|
|
|
(18,237
|
)
|
||||
Less: Impairment of assets
|
—
|
|
|
(989
|
)
|
|
(4,953
|
)
|
|
(11,177
|
)
|
||||
Less: Stock-based compensation expense
|
(6,740
|
)
|
|
(3,651
|
)
|
|
(20,694
|
)
|
|
(16,245
|
)
|
||||
Less: Depreciation and amortization
|
(14,199
|
)
|
|
(19,979
|
)
|
|
(43,586
|
)
|
|
(41,857
|
)
|
||||
Less: Income tax expense
|
(84
|
)
|
|
(137
|
)
|
|
(323
|
)
|
|
(386
|
)
|
||||
Less: Loss on early extinguishment of debt, net
|
—
|
|
|
(911
|
)
|
|
(468
|
)
|
|
(3,447
|
)
|
||||
Net income (loss)
|
$
|
3,626
|
|
|
$
|
(8,832
|
)
|
|
$
|
370,347
|
|
|
$
|
86,702
|
|
Property/Collateral Types
|
|
Real Estate Finance
|
|
Net
Lease
|
|
Operating Properties
|
|
Land & Development
|
|
Total
|
|
% of
Total |
|||||||||||
Office / Industrial
|
|
$
|
83,835
|
|
|
$
|
1,150,760
|
|
|
$
|
98,874
|
|
|
$
|
—
|
|
|
$
|
1,333,469
|
|
|
29.4
|
%
|
Entertainment / Leisure
|
|
—
|
|
|
934,351
|
|
|
15,869
|
|
|
—
|
|
|
950,220
|
|
|
20.9
|
%
|
|||||
Land and Development
|
|
84,597
|
|
|
—
|
|
|
—
|
|
|
662,419
|
|
|
747,016
|
|
|
16.4
|
%
|
|||||
Ground Leases
|
|
—
|
|
|
611,209
|
|
|
—
|
|
|
—
|
|
|
611,209
|
|
|
13.4
|
%
|
|||||
Hotel
|
|
160,630
|
|
|
—
|
|
|
76,433
|
|
|
—
|
|
|
237,063
|
|
|
5.2
|
%
|
|||||
Mixed Use / Mixed Collateral
|
|
194,581
|
|
|
—
|
|
|
39,210
|
|
|
—
|
|
|
233,791
|
|
|
5.1
|
%
|
|||||
Multifamily
|
|
127,700
|
|
|
—
|
|
|
32,154
|
|
|
—
|
|
|
159,854
|
|
|
3.5
|
%
|
|||||
Other Property Types
|
|
36,053
|
|
|
57,348
|
|
|
—
|
|
|
—
|
|
|
93,401
|
|
|
2.1
|
%
|
|||||
Condominium
|
|
63,759
|
|
|
—
|
|
|
11,742
|
|
|
—
|
|
|
75,501
|
|
|
1.7
|
%
|
|||||
Retail
|
|
21,600
|
|
|
—
|
|
|
39,654
|
|
|
—
|
|
|
61,254
|
|
|
1.3
|
%
|
|||||
Strategic Investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,413
|
|
|
1.0
|
%
|
|||||
Total
|
|
$
|
772,755
|
|
|
$
|
2,753,668
|
|
|
$
|
313,936
|
|
|
$
|
662,419
|
|
|
$
|
4,547,191
|
|
|
100.0
|
%
|
Geographic Region
|
|
Real Estate Finance
|
|
Net
Lease
|
|
Operating Properties
|
|
Land & Development
|
|
Total
|
|
% of
Total |
|||||||||||
Northeast
|
|
$
|
286,918
|
|
|
$
|
767,249
|
|
|
$
|
92,656
|
|
|
$
|
317,707
|
|
|
$
|
1,464,530
|
|
|
32.3
|
%
|
West
|
|
224,598
|
|
|
509,625
|
|
|
56,170
|
|
|
75,801
|
|
|
866,194
|
|
|
19.0
|
%
|
|||||
Mid-Atlantic
|
|
12,287
|
|
|
486,862
|
|
|
—
|
|
|
131,656
|
|
|
630,805
|
|
|
13.9
|
%
|
|||||
Southwest
|
|
30,100
|
|
|
422,278
|
|
|
105,802
|
|
|
51,493
|
|
|
609,673
|
|
|
13.4
|
%
|
|||||
Southeast
|
|
62,536
|
|
|
320,101
|
|
|
15,422
|
|
|
54,262
|
|
|
452,321
|
|
|
9.9
|
%
|
|||||
Central
|
|
60,771
|
|
|
238,385
|
|
|
43,886
|
|
|
31,500
|
|
|
374,542
|
|
|
8.2
|
%
|
|||||
Various
|
|
95,545
|
|
|
9,168
|
|
|
—
|
|
|
—
|
|
|
104,713
|
|
|
2.3
|
%
|
|||||
Strategic Investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,413
|
|
|
1.0
|
%
|
|||||
Total
|
|
$
|
772,755
|
|
|
$
|
2,753,668
|
|
|
$
|
313,936
|
|
|
$
|
662,419
|
|
|
$
|
4,547,191
|
|
|
100.0
|
%
|
|
September 30, 2019
|
|||||||||||||||||
|
Number of Loans
|
|
Gross Carrying Value
|
|
Reserve for Loan Losses
|
|
Carrying Value
|
|
% of Total
|
|
Reserve for Loan Losses as a % of Gross Carrying Value
|
|||||||
Performing loans
|
25
|
|
|
$
|
648,362
|
|
|
$
|
(8,700
|
)
|
|
$
|
639,662
|
|
|
97.5%
|
|
1.3%
|
Non-performing loans
|
1
|
|
|
38,400
|
|
|
(21,701
|
)
|
|
16,699
|
|
|
2.5%
|
|
56.5%
|
|||
Total
|
26
|
|
|
$
|
686,762
|
|
|
$
|
(30,401
|
)
|
|
$
|
656,361
|
|
|
100.0%
|
|
4.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
December 31, 2018
|
|||||||||||||||||
|
Number of Loans
|
|
Gross Carrying Value
|
|
Reserve for Loan Losses
|
|
Carrying Value
|
|
% of Total
|
|
Reserve for Loan Losses as a % of Gross Carrying Value
|
|||||||
Performing loans
|
35
|
|
|
$
|
852,768
|
|
|
$
|
(13,000
|
)
|
|
$
|
839,768
|
|
|
97.0%
|
|
1.5%
|
Non-performing loans
|
3
|
|
|
66,725
|
|
|
(40,395
|
)
|
|
26,330
|
|
|
3.0%
|
|
60.5%
|
|||
Total
|
38
|
|
|
$
|
919,493
|
|
|
$
|
(53,395
|
)
|
|
$
|
866,098
|
|
|
100.0%
|
|
5.8%
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
Senior mortgages
|
$
|
516,168
|
|
|
$
|
694,025
|
|
Corporate/Partnership loans
|
121,500
|
|
|
148,583
|
|
||
Subordinate mortgages
|
10,694
|
|
|
10,160
|
|
||
Total
|
$
|
648,362
|
|
|
$
|
852,768
|
|
|
|
|
|
||||
Weighted average LTV
|
64
|
%
|
|
63
|
%
|
||
Yield
|
9.0
|
%
|
|
9.2
|
%
|
|
|
Consolidated
Real Estate(1)
|
|
Net Lease Venture II
|
|
SAFE
|
||||||
Ownership %
|
|
100.0
|
%
|
|
51.9
|
%
|
|
67.1
|
%
|
|||
Gross book value (millions)(2)
|
|
$
|
2,154
|
|
|
$
|
31
|
|
|
$
|
1,452
|
|
|
|
|
|
|
|
|
||||||
% Leased
|
|
98.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|||
Square footage (thousands)
|
|
16,230
|
|
|
169
|
|
|
N/A
|
|
|||
Weighted average lease term (years)(3)
|
|
17.8
|
|
|
9.3
|
|
|
87.6
|
|
|||
Weighted average yield(4)
|
|
8.0
|
%
|
|
8.1
|
%
|
|
4.3
|
%
|
Land and Development Portfolio Rollforward
|
||||||||||||||||
(in millions)
|
||||||||||||||||
|
|
Asbury Ocean Club and Asbury Park Waterfront
|
|
Magnolia
Green
|
|
All
Others
|
|
Total
Segment
|
||||||||
Beginning balance(1)
|
|
$
|
240.1
|
|
|
$
|
109.5
|
|
|
$
|
248.6
|
|
|
$
|
598.2
|
|
Asset sales(2)
|
|
(31.7
|
)
|
|
(12.1
|
)
|
|
(25.4
|
)
|
|
(69.2
|
)
|
||||
Capital expenditures
|
|
63.6
|
|
|
15.7
|
|
|
6.7
|
|
|
86.0
|
|
||||
Other(3)
|
|
(28.8
|
)
|
|
(1.7
|
)
|
|
25.9
|
|
|
(4.6
|
)
|
||||
Ending balance(1)
|
|
$
|
243.2
|
|
|
$
|
111.4
|
|
|
$
|
255.8
|
|
|
$
|
610.4
|
|
(1)
|
As of September 30, 2019 and December 31, 2018, Total Segment excludes $42.7 million and $65.3 million, respectively, of equity method investments.
|
(2)
|
Represents gross book value of the assets sold, rather than proceeds received.
|
(3)
|
For Asbury Ocean Club and Asbury Park Waterfront, other represents assets transferred to the operating properties segment.
|
|
For the Three Months Ended September 30,
|
|
|
||||||||
|
2019
|
|
2018
|
|
$ Change
|
||||||
|
(in thousands)
|
||||||||||
Operating lease income
|
$
|
44,110
|
|
|
$
|
59,109
|
|
|
$
|
(14,999
|
)
|
Interest income
|
19,701
|
|
|
22,915
|
|
|
(3,214
|
)
|
|||
Interest income from sales-type leases
|
8,339
|
|
|
—
|
|
|
8,339
|
|
|||
Other income
|
18,270
|
|
|
27,808
|
|
|
(9,538
|
)
|
|||
Land development revenue
|
54,918
|
|
|
12,309
|
|
|
42,609
|
|
|||
Total revenue
|
145,338
|
|
|
122,141
|
|
|
23,197
|
|
|||
Interest expense
|
46,522
|
|
|
47,219
|
|
|
(697
|
)
|
|||
Real estate expense
|
23,187
|
|
|
32,287
|
|
|
(9,100
|
)
|
|||
Land development cost of sales
|
48,101
|
|
|
12,114
|
|
|
35,987
|
|
|||
Depreciation and amortization
|
14,199
|
|
|
19,979
|
|
|
(5,780
|
)
|
|||
General and administrative
|
24,110
|
|
|
21,613
|
|
|
2,497
|
|
|||
(Recovery of) provision for loan losses
|
(3,805
|
)
|
|
200
|
|
|
(4,005
|
)
|
|||
Impairment of assets
|
—
|
|
|
989
|
|
|
(989
|
)
|
|||
Other expense
|
407
|
|
|
298
|
|
|
109
|
|
|||
Total costs and expenses
|
152,721
|
|
|
134,699
|
|
|
18,022
|
|
|||
Income from sales of real estate
|
3,476
|
|
|
5,409
|
|
|
(1,933
|
)
|
|||
Loss on early extinguishment of debt, net
|
—
|
|
|
(911
|
)
|
|
911
|
|
|||
Earnings (losses) from equity method investments
|
7,617
|
|
|
(635
|
)
|
|
8,252
|
|
|||
Income tax expense
|
(84
|
)
|
|
(137
|
)
|
|
53
|
|
|||
Net income (loss)
|
$
|
3,626
|
|
|
$
|
(8,832
|
)
|
|
$
|
12,458
|
|
|
|
Three Months Ended September 30,
|
|
|
||||||||
|
|
2019
|
|
2018
|
|
Change
|
||||||
Net Lease(1)
|
|
$
|
38.0
|
|
|
$
|
45.2
|
|
|
$
|
(7.2
|
)
|
Operating Properties(2)
|
|
6.0
|
|
|
13.8
|
|
|
(7.8
|
)
|
|||
Land and Development
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|||
Total
|
|
$
|
44.1
|
|
|
$
|
59.1
|
|
|
$
|
(15.0
|
)
|
(1)
|
Change primarily due to the reclassification of certain operating leases to sales-type leases in May 2019 (refer to Note 5) and asset sales, partially offset by new acquisitions.
|
(2)
|
Change primarily due to asset sales.
|
|
|
Three Months Ended September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Operating lease income
|
|
$
|
39.7
|
|
|
$
|
38.5
|
|
Rent per square foot
|
|
$
|
10.68
|
|
|
$
|
10.33
|
|
Occupancy(1)
|
|
98.1
|
%
|
|
98.6
|
%
|
(1)
|
Occupancy as of September 30, 2019 and 2018.
|
|
|
Three Months Ended September 30,
|
|
|
||||||||
|
|
2019
|
|
2018
|
|
Change
|
||||||
Operating Properties(1)
|
|
$
|
9.4
|
|
|
$
|
18.6
|
|
|
$
|
(9.2
|
)
|
Land and Development(2)
|
|
7.4
|
|
|
8.9
|
|
|
(1.5
|
)
|
|||
Net Lease(3)
|
|
6.4
|
|
|
4.8
|
|
|
1.6
|
|
|||
Total
|
|
$
|
23.2
|
|
|
$
|
32.3
|
|
|
$
|
(9.1
|
)
|
(1)
|
Change primarily due to asset sales.
|
(2)
|
Change primarily due to a decrease in legal and consulting costs, partially offset by new operating properties.
|
(3)
|
Change primarily due to new acquisitions.
|
|
|
Three Months Ended September 30,
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
Change
|
|||||||
Payroll and related costs
|
|
$
|
14.2
|
|
|
$
|
14.2
|
|
|
$
|
—
|
|
|
Performance Incentive Plans(1)
|
|
5.1
|
|
5.0
|
|
2.4
|
|
|
2.7
|
|
|||
Public company costs
|
|
1.5
|
|
|
1.0
|
|
|
0.5
|
|
||||
Occupancy costs
|
|
1.1
|
|
|
1.2
|
|
|
(0.1
|
)
|
||||
Other
|
|
2.2
|
|
|
2.8
|
|
|
(0.6
|
)
|
||||
Total
|
|
$
|
24.1
|
|
|
$
|
21.6
|
|
|
$
|
2.5
|
|
(1)
|
Represents the fair value of points issued and change in fair value of the plans during the periods presented. For liability-classified awards, such amounts may increase or decrease over time until the awards are settled. Please refer to Note 15 - Stock-Based Compensation Plans and Employee Benefits for a description of the Performance Incentive Plans.
|
|
|
Three Months Ended September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Net Lease
|
|
$
|
3.5
|
|
|
$
|
—
|
|
Operating Properties
|
|
—
|
|
|
5.4
|
|
||
Total
|
|
$
|
3.5
|
|
|
$
|
5.4
|
|
|
For the Nine Months
Ended September 30, |
|
|
||||||||
|
2019
|
|
2018
|
|
$ Change
|
||||||
|
(in thousands)
|
||||||||||
Operating lease income
|
$
|
158,210
|
|
|
$
|
149,516
|
|
|
$
|
8,694
|
|
Interest income
|
60,417
|
|
|
74,824
|
|
|
(14,407
|
)
|
|||
Interest income from sales-type leases
|
12,157
|
|
|
—
|
|
|
12,157
|
|
|||
Other income
|
43,133
|
|
|
63,951
|
|
|
(20,818
|
)
|
|||
Land development revenue
|
76,691
|
|
|
369,665
|
|
|
(292,974
|
)
|
|||
Total revenue
|
350,608
|
|
|
657,956
|
|
|
(307,348
|
)
|
|||
Interest expense
|
136,851
|
|
|
135,572
|
|
|
1,279
|
|
|||
Real estate expense
|
71,165
|
|
|
105,511
|
|
|
(34,346
|
)
|
|||
Land development cost of sales
|
71,785
|
|
|
318,881
|
|
|
(247,096
|
)
|
|||
Depreciation and amortization
|
43,586
|
|
|
41,857
|
|
|
1,729
|
|
|||
General and administrative
|
72,512
|
|
|
73,655
|
|
|
(1,143
|
)
|
|||
Provision for loan losses
|
(3,792
|
)
|
|
18,237
|
|
|
(22,029
|
)
|
|||
Impairment of assets
|
4,953
|
|
|
11,177
|
|
|
(6,224
|
)
|
|||
Other expense
|
12,798
|
|
|
5,180
|
|
|
7,618
|
|
|||
Total costs and expenses
|
409,858
|
|
|
710,070
|
|
|
(300,212
|
)
|
|||
Income from sales of real estate
|
233,406
|
|
|
79,353
|
|
|
154,053
|
|
|||
Loss on early extinguishment of debt, net
|
(468
|
)
|
|
(3,447
|
)
|
|
2,979
|
|
|||
Earnings (losses) from equity method investments
|
16,566
|
|
|
(4,581
|
)
|
|
21,147
|
|
|||
Selling profit from sales-type leases
|
180,416
|
|
|
—
|
|
|
180,416
|
|
|||
Gain on consolidation of equity method investment
|
—
|
|
|
67,877
|
|
|
(67,877
|
)
|
|||
Income tax expense
|
(323
|
)
|
|
(386
|
)
|
|
63
|
|
|||
Net income
|
$
|
370,347
|
|
|
$
|
86,702
|
|
|
$
|
283,645
|
|
|
|
For the Nine Months
Ended September 30, |
|
|
||||||||
|
|
2019
|
|
2018
|
|
Change
|
||||||
Net Lease(1)
|
|
$
|
136.2
|
|
|
$
|
104.2
|
|
|
$
|
32.0
|
|
Operating Properties(2)
|
|
21.8
|
|
|
44.8
|
|
|
(23.0
|
)
|
|||
Land and Development
|
|
0.2
|
|
|
0.5
|
|
|
(0.3
|
)
|
|||
Total
|
|
$
|
158.2
|
|
|
$
|
149.5
|
|
|
$
|
8.7
|
|
(1)
|
Change primarily due to a $42.1 million increase from the consolidation of the Net Lease Venture on June 30, 2018 and acquiring new assets during the nine months ended September 30, 2019, partially offset by a decrease of $9.1 million from the reclassification of certain operating leases as sales-type leases in May 2019 (refer to Note 5) and asset sales.
|
(2)
|
Change primarily due to asset sales.
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Operating lease income
|
|
$
|
67.4
|
|
|
$
|
67.1
|
|
Rent per square foot
|
|
$
|
9.46
|
|
|
$
|
9.39
|
|
Occupancy(1)
|
|
97.1
|
%
|
|
97.9
|
%
|
(1)
|
Occupancy as of September 30, 2019 and 2018.
|
|
|
Nine Months Ended September 30,
|
|
|
||||||||
|
|
2019
|
|
2018
|
|
Change
|
||||||
Operating Properties(1)
|
|
$
|
28.8
|
|
|
$
|
64.1
|
|
|
$
|
(35.3
|
)
|
Land and Development(2)
|
|
24.2
|
|
|
29.2
|
|
|
(5.0
|
)
|
|||
Net Lease(3)
|
|
18.2
|
|
|
12.2
|
|
|
6.0
|
|
|||
Total
|
|
$
|
71.2
|
|
|
$
|
105.5
|
|
|
$
|
(34.3
|
)
|
(1)
|
Change primarily due to asset sales, partially offset by an increase at properties that began operations.
|
(2)
|
Change primarily due to certain properties being moved to operating properties after beginning operations and a decrease in legal costs at properties, partially offset by an increase in marketing costs at certain of our properties.
|
(3)
|
Change primarily due to the consolidation of the Net Lease Venture.
|
|
|
Nine Months Ended September 30,
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
Change
|
|||||||
Payroll and related costs(1)
|
|
$
|
40.8
|
|
|
$
|
45.0
|
|
|
$
|
(4.2
|
)
|
|
Performance Incentive Plans(2)
|
|
16.6
|
|
5.0
|
|
12.6
|
|
|
4.0
|
|
|||
Public company costs
|
|
4.4
|
|
|
3.9
|
|
|
0.5
|
|
||||
Occupancy costs
|
|
3.3
|
|
|
3.8
|
|
|
(0.5
|
)
|
||||
Other
|
|
7.4
|
|
|
8.4
|
|
|
(1.0
|
)
|
||||
Total
|
|
$
|
72.5
|
|
|
$
|
73.7
|
|
|
$
|
(1.2
|
)
|
(1)
|
Decrease due to a reduction in headcount to 157 employees as of September 30, 2019 from 186 employees as of December 31, 2017.
|
(2)
|
Represents the fair value of points issued and change in fair value of the plans during the periods presented. For liability-classified awards, such amounts may increase or decrease over time until the awards are settled. Please refer to Note 15 - Stock-Based Compensation Plans and Employee Benefits for a description of the Performance Incentive Plans.
|
|
|
Nine Months Ended
September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Net Lease(1)
|
|
$
|
223.2
|
|
|
$
|
54.5
|
|
Operating Properties
|
|
10.2
|
|
|
24.9
|
|
||
Total
|
|
$
|
233.4
|
|
|
$
|
79.4
|
|
(1)
|
During the nine months ended September 30, 2019, we sold a portfolio of net lease assets with an aggregate carrying value of $220.4 million and recognized gains of $219.7 million in "Income from sales of real estate" in our consolidated statements of operations.
|
|
For the Three Months Ended
September 30,
|
|
For the Nine Months Ended
September 30,
|
|||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||
|
(in thousands)
|
|||||||||||||||||||||||
Adjusted Income
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss) allocable to common shareholders
|
$
|
(7,343
|
)
|
|
$
|
(18,984
|
)
|
|
$
|
(34,530
|
)
|
|
$
|
337,807
|
|
|
$
|
50,698
|
|
|
$
|
115,834
|
|
|
Add: Depreciation and amortization(1)
|
14,266
|
|
|
19,873
|
|
|
14,765
|
|
|
44,008
|
|
|
52,153
|
|
|
45,438
|
|
|||||||
Add (Less): Provision for (recovery of) loan losses
|
(3,805
|
)
|
|
200
|
|
|
(2,600
|
)
|
|
(3,792
|
)
|
|
18,237
|
|
|
(8,128
|
)
|
|||||||
Add: Impairment of assets(2)
|
—
|
|
|
989
|
|
|
595
|
|
|
4,953
|
|
|
21,769
|
|
|
15,292
|
|
|||||||
Add: Stock-based compensation expense
|
6,740
|
|
|
3,651
|
|
|
2,934
|
|
|
20,694
|
|
|
16,245
|
|
|
12,730
|
|
|||||||
Add: Loss on early extinguishment of debt, net
|
—
|
|
|
911
|
|
|
616
|
|
|
468
|
|
|
3,447
|
|
|
1,392
|
|
|||||||
Add: Non-cash interest expense on senior convertible notes
|
1,254
|
|
—
|
|
1,191
|
|
|
110
|
|
|
3,714
|
|
|
3,527
|
|
|
110
|
|
||||||
Add: Premium on redemption of preferred stock
|
—
|
|
|
—
|
|
|
16,314
|
|
|
—
|
|
|
—
|
|
|
16,314
|
|
|||||||
Add: Deferred gain on sale(3)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
55,500
|
|
|||||||
Less: Losses on charge-offs and dispositions(4)
|
(7,673
|
)
|
|
(4,093
|
)
|
|
(1,779
|
)
|
|
(87,673
|
)
|
|
(65,553
|
)
|
|
(15,906
|
)
|
|||||||
Adjusted income (loss) allocable to common shareholders(3)
|
$
|
3,439
|
|
|
$
|
3,738
|
|
|
$
|
(3,575
|
)
|
|
$
|
320,179
|
|
|
$
|
100,523
|
|
|
$
|
238,576
|
|
(1)
|
Depreciation and amortization also includes our proportionate share of depreciation and amortization expense for equity method investments and excludes the portion of depreciation and amortization expense allocable to noncontrolling interests.
|
(2)
|
Impairment of assets includes impairments on equity method investments recorded in "Earnings from equity method investments" in our consolidated statements of operations.
|
(3)
|
Adjusted Income for the nine months ended September 30, 2018, as previously reported, included a $75.9 million add-back attributable to aggregate deferred gains on our retained interests in entities to which we sold or contributed properties prior to 2018 and a $3.3 million add-back for depreciation related to such properties. We recognized those gains in our GAAP retained earnings as of January 1, 2018 when we adopted a new accounting standard that mandated such recognition. We are retrospectively modifying our presentation of Adjusted Income for 2018 and 2017, as shown in the table above, to reflect the effects of the dispositions in the periods in which they occurred. Adjusted Income for the nine months ended September 30, 2017 shown in the table above includes $55.5 million of the aggregate deferred gain, which resulted from the sale of our Ground Lease business to SAFE in the second quarter of 2017. The remaining $23.7 million of the aggregate deferred gains are not shown in the table above because the disposition transactions occurred prior to 2017. Adjusted Income as previously reported (i.e., prior to the retrospective modification) for the three and nine months ended September 30, 2018 was $3.7 million and $179.7 million, respectively, and for the three and nine months ended September 30, 2017 was $(3.6) million and $183.1 million, respectively.
|
(4)
|
Represents the impact of charge-offs and dispositions realized during the period. These charge-offs and dispositions were on assets that were previously impaired for GAAP and reflected in net income but not Adjusted Income.
|
|
For the Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Operating Properties
|
$
|
5,965
|
|
|
$
|
22,671
|
|
Net Lease
|
15,116
|
|
|
21,540
|
|
||
Total capital expenditures on real estate assets
|
$
|
21,081
|
|
|
$
|
44,211
|
|
|
|
|
|
||||
Land and Development
|
$
|
93,395
|
|
|
$
|
98,489
|
|
Total capital expenditures on land and development assets
|
$
|
93,395
|
|
|
$
|
98,489
|
|
|
Amounts Due By Period
|
||||||||||||||||||||||
|
Total
|
|
Less Than 1
Year
|
|
1 - 3
Years
|
|
3 - 5
Years
|
|
5 - 10
Years
|
|
After 10
Years
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Long-Term Debt Obligations:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unsecured notes(1)
|
$
|
2,412,500
|
|
|
$
|
—
|
|
|
$
|
1,737,500
|
|
|
$
|
—
|
|
|
$
|
675,000
|
|
|
$
|
—
|
|
Secured credit facilities
|
641,875
|
|
|
6,500
|
|
|
13,000
|
|
|
622,375
|
|
|
—
|
|
|
—
|
|
||||||
Mortgages
|
724,651
|
|
|
13,452
|
|
|
179,612
|
|
|
66,959
|
|
|
453,687
|
|
|
10,941
|
|
||||||
Trust preferred securities
|
100,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100,000
|
|
||||||
Total principal maturities
|
3,879,026
|
|
|
19,952
|
|
|
1,930,112
|
|
|
689,334
|
|
|
1,128,687
|
|
|
110,941
|
|
||||||
Interest Payable(1)(2)
|
720,653
|
|
|
172,542
|
|
|
308,117
|
|
|
134,049
|
|
|
82,637
|
|
|
23,308
|
|
||||||
Loan Participations Payable(3)
|
33,189
|
|
|
33,189
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Lease Obligations(4)
|
1,613,457
|
|
|
9,554
|
|
|
14,119
|
|
|
12,869
|
|
|
32,401
|
|
|
1,544,514
|
|
||||||
Total
|
$
|
6,246,325
|
|
|
$
|
235,237
|
|
|
$
|
2,252,348
|
|
|
$
|
836,252
|
|
|
$
|
1,243,725
|
|
|
$
|
1,678,763
|
|
(1)
|
The $400.0 million principal amount outstanding of the 4.625% senior unsecured notes due September 2020 and the $275.0 million principal amount outstanding of the 6.50% senior unsecured notes due July 2021 were repaid in full in October 2019.
|
(2)
|
Variable-rate debt assumes one-month LIBOR of 2.02% and three-month LIBOR of 2.09% that were in effect as of September 30, 2019. Interest payable does not include payments that may be required under our interest rate derivatives.
|
(3)
|
Refer to Note 10 to the consolidated financial statements.
|
(4)
|
We are obligated to pay ground rent under certain operating leases; however, our tenants at the properties pay this expense directly under the terms of various subleases and these amounts are excluded from lease obligations.
|
|
As of
|
||||||||||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Collateral Assets(1)
|
|
Non-Collateral Assets
|
|
Collateral Assets(1)
|
|
Non-Collateral Assets
|
||||||||
Real estate, net
|
$
|
1,413,531
|
|
|
$
|
116,585
|
|
|
$
|
1,620,008
|
|
|
$
|
151,011
|
|
Real estate available and held for sale
|
—
|
|
|
12,688
|
|
|
1,055
|
|
|
21,496
|
|
||||
Net investment in leases
|
421,252
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Land and development, net
|
42,402
|
|
|
567,978
|
|
|
12,300
|
|
|
585,918
|
|
||||
Loans receivable and other lending investments, net(2)(3)
|
308,474
|
|
|
475,374
|
|
|
498,524
|
|
|
480,154
|
|
||||
Other investments
|
—
|
|
|
733,793
|
|
|
—
|
|
|
304,275
|
|
||||
Cash and other assets
|
2,645
|
|
|
1,460,795
|
|
|
—
|
|
|
1,329,990
|
|
||||
Total
|
$
|
2,188,304
|
|
|
$
|
3,367,213
|
|
|
$
|
2,131,887
|
|
|
$
|
2,872,844
|
|
(1)
|
The 2016 Senior Term Loan and the 2015 Revolving Credit Facility are secured only by pledges of equity of certain of our subsidiaries and not by pledges of the assets held by such subsidiaries. Such subsidiaries are subject to contractual restrictions under the terms of such credit facilities, including restrictions on incurring new debt (subject to certain exceptions). As of September 30, 2019, Collateral Assets includes $412.0 million carrying value of assets held by entities whose equity interests are pledged as collateral for the 2015 Revolving Credit Facility that is undrawn as of September 30, 2019.
|
(2)
|
As of September 30, 2019 and December 31, 2018, the amounts presented exclude general reserves for loan losses of $8.7 million and $13.0 million, respectively.
|
(3)
|
As of September 30, 2019 and December 31, 2018, the amounts presented exclude loan participations of $33.1 million and $22.5 million, respectively.
|
|
Loans and Other Lending Investments(1)
|
|
Real Estate(2)
|
|
Other
Investments
|
|
Total
|
||||||||
Performance-Based Commitments
|
$
|
294,059
|
|
|
$
|
77,251
|
|
|
$
|
—
|
|
|
$
|
371,310
|
|
Strategic Investments
|
—
|
|
|
—
|
|
|
24,177
|
|
|
24,177
|
|
||||
Total
|
$
|
294,059
|
|
|
$
|
77,251
|
|
|
$
|
24,177
|
|
|
$
|
395,487
|
|
(1)
|
Excludes $16.8 million of commitments on loan participations sold that are not our obligation.
|
(2)
|
Includes a commitment to invest up to $55.0 million in additional bowling centers over the next several years (refer to Note 5).
|
Change in Interest Rates
|
|
Net Income(1)
|
||
-100 Basis Points
|
|
$
|
(6,184
|
)
|
-50 Basis Points
|
|
(3,172
|
)
|
|
-10 Basis Points
|
|
(670
|
)
|
|
Base Interest Rate
|
|
—
|
|
|
+10 Basis Points
|
|
702
|
|
|
+50 Basis Points
|
|
3,827
|
|
|
+100 Basis Points
|
|
7,821
|
|
(1)
|
We have an overall net variable-rate asset position, which results in an increase in net income when rates increase and a decrease in net income when rates decrease. As of September 30, 2019, $400.3 million of our floating rate loans have a weighted average interest rate floor of 1.3% and $33.2 million of our floating rate debt obligations have a weighted average interest rate floor of 0.4%.
|
|
Total Number of Shares Purchased
|
Average Price Paid per Share
|
Total Number of Shares Purchased as Part of a Publicly Announced Plan
|
Maximum Dollar Value of Shares that May Yet be Purchased Under the Plans(1)
|
||||||
July 1 to July 31
|
35,632
|
|
$
|
12.42
|
|
35,632
|
|
$
|
22,101,305
|
|
August 1 to August 31
|
—
|
|
$
|
—
|
|
—
|
|
$
|
22,101,305
|
|
September 1 to September 30
|
—
|
|
$
|
—
|
|
—
|
|
$
|
22,101,305
|
|
(1)
|
We may repurchase shares in negotiated transactions or open market transactions, including through one or more trading plans.
|
Exhibit
Number
|
Document Description
|
10.1
|
|
31.0
|
|
32.0
|
|
101*
|
The following financial information from the Company's Quarterly Report on Form 10-Q for the period ended September 30, 2019 is formatted in Inline XBRL ("eXtensible Business Reporting Language"): (i) the Consolidated Balance Sheets (unaudited) as of September 30, 2019 and December 31, 2018, (ii) the Consolidated Statements of Operations (unaudited) for the three and nine months ended September 30, 2019 and 2018, (iii) the Consolidated Statements of Comprehensive Income (Loss) (unaudited) for the three and nine months ended September 30, 2019 and 2018, (iv) the Consolidated Statements of Changes in Equity (unaudited) for the three and nine months ended September 30, 2019 and 2018, (v) the Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2019 and 2018 and (vi) the Notes to the Consolidated Financial Statements (unaudited).
|
*
|
In accordance with Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 is deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Exchange Act of 1934 and otherwise is not subject to liability under these sections.
|
|
|
iStar Inc.
Registrant
|
Date:
|
October 31, 2019
|
/s/ JAY SUGARMAN
|
|
|
Jay Sugarman
Chairman of the Board of Directors and Chief
Executive Officer (principal executive officer)
|
|
|
|
|
|
iStar Inc.
Registrant
|
Date:
|
October 31, 2019
|
/s/ GARETT ROSENBLUM
|
|
|
Garett Rosenblum
Chief Accounting Officer
(principal financial officer)
|
Date:
|
October 31, 2019
|
By:
|
|
/s/ JAY SUGARMAN
|
||
|
|
|
|
Name:
|
|
Jay Sugarman
|
|
|
|
|
Title:
|
|
Chief Executive Officer
|
Date:
|
October 31, 2019
|
By:
|
|
/s/ GARETT ROSENBLUM
|
||
|
|
|
|
Name:
|
|
Garett Rosenblum
|
|
|
|
|
Title:
|
|
Chief Accounting Officer
(principal financial officer)
|
Date:
|
October 31, 2019
|
By:
|
|
/s/ JAY SUGARMAN
|
||
|
|
|
|
Name:
|
|
Jay Sugarman
|
|
|
|
|
Title:
|
|
Chief Executive Officer
|
Date:
|
October 31, 2019
|
By:
|
|
/s/ GARETT ROSENBLUM
|
||
|
|
|
|
Name:
|
|
Garett Rosenblum
|
|
|
|
|
Title:
|
|
Chief Accounting Officer
(principal financial officer)
|