Maryland
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76-0594970
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(State or Other Jurisdiction of incorporation or
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(I.R.S. Employer
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Organization)
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Identification No.)
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2600 South Gessner, Suite 500, Houston, Texas
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77063
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(Address of Principal Executive Offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Class B Common Shares of Beneficial Interest, par value $0.001 per share
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NYSE Amex
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Page
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Item 1.
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Business
.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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•
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the imposition of federal taxes if we fail to qualify as a real estate investment trust ("REIT") in any taxable year or forego an opportunity to ensure REIT status;
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•
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uncertainties related to the national economy, the real estate industry in general and in our specific markets;
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•
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legislative or regulatory changes, including changes to laws governing REITs;
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•
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adverse economic or real estate developments in Texas, Arizona or Illinois;
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•
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increases in interest rates and operating costs;
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•
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inability to obtain necessary outside financing;
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•
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litigation risks;
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•
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lease-up risks;
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•
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inability to obtain new tenants upon the expiration of existing leases;
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•
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inability to generate sufficient cash flows due to market conditions, competition, uninsured losses, changes in tax or other applicable laws; and
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•
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the need to fund tenant improvements or other capital expenditures out of operating cash flow.
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•
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Strategically Acquiring Properties.
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◦
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Seeking High Growth Markets.
We seek to strategically acquire commercial properties in high-growth markets. Our acquisition targets are located in densely populated, culturally diverse neighborhoods, primarily in and around Phoenix, Chicago, Dallas, San Antonio and Houston, five of the top 20 markets in the United States in terms of population growth.
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◦
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Diversifying Geographically.
Our current portfolio is concentrated in Houston. We believe that continued geographic diversification in markets where we have substantial knowledge and experience will help offset the economic risk from a single market concentration. We intend to continue to focus our expansion efforts on the Phoenix, Chicago, Dallas and San Antonio markets. We believe our management infrastructure and capacity can accommodate substantial growth in those markets. We may also pursue opportunities in other Southwestern and Western regions that are consistent with our Community Centered Property strategy.
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◦
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Capitalizing on Availability of Distressed Assets
. We believe that during the next several years there will be excellent opportunities in our target markets to acquire quality properties at historically attractive prices. We intend to acquire distressed assets directly from owners or financial institutions holding foreclosed real estate and debt instruments that are either in default or on bank watch lists. Many of these assets may benefit from our corporate strategy and our management team’s experience in turning around distressed properties, portfolios and companies. We have extensive relationships with community banks, attorneys, title companies, and others in the real estate industry with whom we regularly work to identify properties for potential acquisition.
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•
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Redeveloping and Re-tenanting Existing Properties.
We “turn around” properties and seek to add value through renovating and re-tenanting our properties to create Whitestone-branded Community Centered Properties. We seek to accomplish this by (1) stabilizing occupancy, with per property occupancy goals of 90% or higher; (2) adding leasable square footage to existing structures; (3) developing and building on excess land; (4) upgrading and renovating existing structures; and (5) investing significant effort in recruiting tenants whose goods and services meet the needs of the surrounding neighborhood.
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•
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Recycling Capital for Greater Returns.
We seek to continually upgrade our portfolio by opportunistically selling properties that do not have the potential to meet our Community Centered Property strategy and redeploying the sale proceeds into properties that better fit our strategy. Some of our properties that were acquired prior to the tenure of our current management team may not fit our Community Centered Property strategy, and we may look for opportunities to dispose of these properties as we continue to execute our strategy.
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•
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Prudent Management of Capital Structure.
We currently have
19
properties that are not mortgaged. We may seek to add mortgage indebtedness to existing and newly acquired unencumbered properties to provide additional capital for acquisitions. As a general policy, we intend to maintain a ratio of total indebtedness to undepreciated book value of real estate assets that is less than 60%. As of
December 31, 2011
, our ratio of total indebtedness to undepreciated book value of real estate assets was
44%
.
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•
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Investing in People.
We believe that our people are the heart of our culture, philosophy and strategy. We continually focus on developing associates who are self-disciplined and motivated and display at all times a high degree of character and competence. We provide them with equity incentives to align their interests with those of our shareholders.
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•
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conditions in financial markets;
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•
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over-building in our markets;
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•
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a reduction in rental income as the result of the inability to maintain occupancy levels;
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•
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adverse changes in applicable tax, real estate, environmental or zoning laws;
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•
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changes in general economic conditions;
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•
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a taking of any of our properties by eminent domain;
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•
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adverse local conditions (such as changes in real estate zoning laws that may reduce the desirability of real estate in the area);
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•
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acts of God, such as hurricanes, earthquakes or floods and other uninsured losses;
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•
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changes in supply of or demand for similar or competing properties in an area;
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•
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changes in interest rates and availability of permanent debt capital, which may render the sale of a property difficult or unattractive; and
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•
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periods of high interest rates, inflation or tight money supply.
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•
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tenants may choose not to, or may not have the financial resources to, renew these leases;
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•
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we may experience significant costs associated with re-leasing a significant amount of our available space;
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•
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we may not be able to easily re-lease the space subject to these leases, which may cause us to fail to meet our leasing targets or control the costs of re-leasing; and
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•
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the terms of any renewal or re-lease may be less favorable than the terms of the current leases.
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•
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competition from other real estate investors with significant capital, including other REITs and institutional investment funds;
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•
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competition from other potential acquirers which may significantly increase the purchase price for a property we acquire, which could reduce our growth prospects;
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•
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unsatisfactory results of our due diligence investigations or failure to meet other customary closing conditions; and
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•
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failure to finance an acquisition on favorable terms or at all.
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•
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a merger, tender offer or proxy contest;
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•
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assumption of control by a holder of a large block of our shares; or
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•
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removal of incumbent management.
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•
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we would not be allowed to deduct our distributions to shareholders when computing our taxable income;
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•
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we would be subject to federal income tax (including any applicable alternative minimum tax) on our taxable income at regular corporate rates;
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•
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we would be disqualified from being taxed as a REIT for the four taxable years following the year during which qualification was lost, unless entitled to relief under certain statutory provisions;
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•
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our cash available for dividends to shareholders would be reduced; and
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•
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we may be required to borrow additional funds or sell some of our assets in order to pay corporate tax obligations that we may incur as a result of our disqualification.
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•
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the amount of the cash available for distribution;
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•
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our Operating Partnership's financial condition;
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•
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our Operating Partnership's capital expenditure requirements; and
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•
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our annual distribution requirements necessary to maintain our qualification as a REIT.
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Commercial Properties
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Gross Leasable Area
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Average
Occupancy as of
12/31/11
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Annualized Base
Rental Revenue
(in thousands)
(1)
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Average
Annualized Base
Rental Revenue
Per Sq. Ft.
(2)
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||||||
Retail
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1,512,199
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90
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%
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$
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15,803
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|
$
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11.61
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|
Office/Flex
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|
1,201,672
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|
86
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%
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|
7,655
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|
|
7.41
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||
Office
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631,841
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|
79
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%
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8,069
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16.17
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Total - Operating Portfolio
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3,345,712
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87
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%
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31,527
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10.83
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Redevelopment, New Acquisitions
(3)
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251,625
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50
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%
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1,314
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|
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10.44
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||
Total
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3,597,337
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84
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%
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$
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32,841
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$
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10.87
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|
(1)
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Calculated as the tenant's actual
December 31, 2011
base rent (defined as cash base rents including abatements) multiplied by 12. Excludes vacant space as of
December 31, 2011
. Because annualized base rental revenue is not derived from historical results that were accounted for in accordance with generally accepted accounting principles, historical results differ from the annualized amounts.
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(2)
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Calculated as annualized base rent divided by net rentable square feet leased at
December 31, 2011
. Excludes vacant space as of
December 31, 2011
.
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(3)
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Includes (i) new acquisitions, through the earlier of attainment of 90% occupancy or 18 months of ownership, and (ii) properties that are undergoing significant redevelopment or re-tenanting.
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July
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Aug.
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Sept.
|
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Oct.
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Nov.
|
|
Dec.
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||||||
National
(1)
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|
9.1
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%
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9.1
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%
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9.0
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%
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|
8.9
|
%
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|
8.7
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%
|
|
8.5
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%
|
|
Houston
(2)
|
|
8.4
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|
|
8.5
|
|
|
8.5
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|
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8.4
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|
|
8.1
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|
7.8
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|
(3)
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(1)
|
Seasonally adjusted.
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(2)
|
Not seasonally adjusted.
|
(3)
|
R
epresents estimate.
|
Whitestone REIT and Subsidiaries
Property Details
As of December 31, 2011
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||||||||||||||||||||||
Community Name
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Location
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Year Built/
Renovated
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Gross Leasable
Square Feet
|
|
Percent
Occupied at
12/31/2011
|
|
Annualized Base
Rental Revenue
(in thousands)
(1)
|
|
Average
Base Rental
Revenue Per
Sq. Ft.
(2)
|
|
Average Net Effective Annual Base Rent Per Leased Sq. Ft.
(3)
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||||||||
Retail Communities:
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||||||||
Ahwatukee Plaza
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Phoenix
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1979
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72,650
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100
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%
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|
$
|
841
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|
|
$
|
11.58
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|
|
$
|
12.79
|
|
Bellnott Square
|
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Houston
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|
1982
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|
73,930
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41
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%
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|
300
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|
|
9.90
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|
|
10.10
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Bissonnet/Beltway
|
|
Houston
|
|
1978
|
|
29,205
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|
|
100
|
%
|
|
317
|
|
|
10.85
|
|
|
10.82
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|
|||
Centre South
|
|
Houston
|
|
1974
|
|
39,134
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|
|
82
|
%
|
|
230
|
|
|
7.17
|
|
|
8.01
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|
|||
Holly Knight
|
|
Houston
|
|
1984
|
|
20,015
|
|
|
100
|
%
|
|
323
|
|
|
16.14
|
|
|
17.39
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|
|||
Kempwood Plaza
|
|
Houston
|
|
1974
|
|
101,008
|
|
|
96
|
%
|
|
849
|
|
|
8.76
|
|
|
8.33
|
|
|||
Lion Square
|
|
Houston
|
|
1980
|
|
119,621
|
|
|
92
|
%
|
|
795
|
|
|
7.22
|
|
|
9.27
|
|
|||
Pinnacle of Scottsdale
|
|
Phoenix
|
|
1991
|
|
113,108
|
|
|
100
|
%
|
|
2,315
|
|
|
20.47
|
|
|
21.03
|
|
|||
Providence
|
|
Houston
|
|
1980
|
|
90,327
|
|
|
97
|
%
|
|
763
|
|
|
8.71
|
|
|
8.15
|
|
|||
Shaver
|
|
Houston
|
|
1978
|
|
21,926
|
|
|
98
|
%
|
|
252
|
|
|
11.73
|
|
|
11.45
|
|
|||
Shops at Starwood
|
|
Dallas
|
|
2006
|
|
55,385
|
|
|
98
|
%
|
|
1,396
|
|
|
25.72
|
|
|
27.30
|
|
|||
South Richey
|
|
Houston
|
|
1980
|
|
69,928
|
|
|
92
|
%
|
|
279
|
|
|
4.34
|
|
|
8.41
|
|
|||
Spoerlein Commons
|
|
Chicago
|
|
1987
|
|
41,455
|
|
|
91
|
%
|
|
743
|
|
|
19.70
|
|
|
19.78
|
|
|||
SugarPark Plaza
|
|
Houston
|
|
1974
|
|
95,032
|
|
|
93
|
%
|
|
800
|
|
|
9.05
|
|
|
9.58
|
|
|||
Sunridge
|
|
Houston
|
|
1979
|
|
49,359
|
|
|
99
|
%
|
|
407
|
|
|
8.33
|
|
|
9.37
|
|
|||
Terravita Marketplace
|
|
Phoenix
|
|
1997
|
|
102,733
|
|
|
96
|
%
|
|
1,333
|
|
|
13.52
|
|
|
14.12
|
|
|||
Torrey Square
|
|
Houston
|
|
1983
|
|
105,766
|
|
|
98
|
%
|
|
853
|
|
|
8.23
|
|
|
8.05
|
|
|||
Town Park
|
|
Houston
|
|
1978
|
|
43,526
|
|
|
100
|
%
|
|
789
|
|
|
18.13
|
|
|
17.76
|
|
|||
Webster Point
|
|
Houston
|
|
1984
|
|
26,060
|
|
|
100
|
%
|
|
289
|
|
|
11.09
|
|
|
10.90
|
|
|||
Westchase
|
|
Houston
|
|
1978
|
|
49,573
|
|
|
84
|
%
|
|
495
|
|
|
11.89
|
|
|
11.50
|
|
|||
Windsor Park
|
|
San Antonio
|
|
1992
|
|
192,458
|
|
|
76
|
%
|
|
1,434
|
|
|
9.80
|
|
|
9.39
|
|
|||
|
|
|
|
|
|
1,512,199
|
|
|
90
|
%
|
|
15,803
|
|
|
11.61
|
|
|
12.15
|
|
|||
Office/Flex Communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Brookhill
|
|
Houston
|
|
1979
|
|
74,757
|
|
|
76
|
%
|
|
$
|
163
|
|
|
$
|
2.87
|
|
|
$
|
4.26
|
|
Corporate Park Northwest
|
|
Houston
|
|
1981
|
|
185,627
|
|
|
70
|
%
|
|
1,352
|
|
|
10.40
|
|
|
10.44
|
|
|||
Corporate Park West
|
|
Houston
|
|
1999
|
|
175,665
|
|
|
87
|
%
|
|
1,321
|
|
|
8.64
|
|
|
9.11
|
|
|||
Corporate Park Woodland
|
|
Houston
|
|
2000
|
|
99,937
|
|
|
96
|
%
|
|
820
|
|
|
8.55
|
|
|
8.73
|
|
|||
Dairy Ashford
|
|
Houston
|
|
1981
|
|
42,902
|
|
|
92
|
%
|
|
210
|
|
|
5.32
|
|
|
5.35
|
|
|||
Holly Hall
|
|
Houston
|
|
1980
|
|
90,000
|
|
|
100
|
%
|
|
713
|
|
|
7.92
|
|
|
8.09
|
|
|||
Interstate 10
|
|
Houston
|
|
1980
|
|
151,000
|
|
|
84
|
%
|
|
654
|
|
|
5.16
|
|
|
5.23
|
|
|||
Main Park
|
|
Houston
|
|
1982
|
|
113,410
|
|
|
96
|
%
|
|
711
|
|
|
6.53
|
|
|
6.51
|
|
|||
Plaza Park
|
|
Houston
|
|
1982
|
|
105,530
|
|
|
79
|
%
|
|
752
|
|
|
9.02
|
|
|
8.64
|
|
|||
Westbelt Plaza
|
|
Houston
|
|
1978
|
|
65,619
|
|
|
76
|
%
|
|
400
|
|
|
8.02
|
|
|
8.16
|
|
|||
Westgate
|
|
Houston
|
|
1984
|
|
97,225
|
|
|
100
|
%
|
|
559
|
|
|
5.75
|
|
|
5.69
|
|
|||
|
|
|
|
|
|
1,201,672
|
|
|
86
|
%
|
|
7,655
|
|
|
7.41
|
|
|
7.57
|
|
Whitestone REIT and Subsidiaries
Property Details
As of December 31, 2011
(continued)
|
||||||||||||||||||||||
Community Name
|
|
Location
|
|
Year Built/
Renovated
|
|
Gross Leasable
Square Feet
|
|
Percent
Occupied at
12/31/2011
|
|
Annualized Base
Rental Revenue
(in thousands)
(1)
|
|
Average
Base Rental
Revenue Per
Sq. Ft.
(2)
|
|
Average Net Effective Annual Base Rent Per Leased Sq. Ft.
(3)
|
||||||||
Office Communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
9101 LBJ Freeway
|
|
Dallas
|
|
1985
|
|
125,874
|
|
|
69
|
%
|
|
$
|
1,356
|
|
|
$
|
15.61
|
|
|
$
|
15.06
|
|
Featherwood
|
|
Houston
|
|
1983
|
|
49,760
|
|
|
84
|
%
|
|
772
|
|
|
18.47
|
|
|
18.02
|
|
|||
Pima Norte
|
|
Phoenix
|
|
2007
|
|
33,417
|
|
|
18
|
%
|
|
110
|
|
|
18.29
|
|
|
17.95
|
|
|||
Royal Crest
|
|
Houston
|
|
1984
|
|
24,900
|
|
|
85
|
%
|
|
267
|
|
|
12.62
|
|
|
12.57
|
|
|||
Uptown Tower
|
|
Dallas
|
|
1982
|
|
253,981
|
|
|
85
|
%
|
|
3,655
|
|
|
16.93
|
|
|
17.00
|
|
|||
Woodlake Plaza
|
|
Houston
|
|
1974
|
|
106,169
|
|
|
88
|
%
|
|
1,343
|
|
|
14.37
|
|
|
14.06
|
|
|||
Zeta Building
|
|
Houston
|
|
1982
|
|
37,740
|
|
|
89
|
%
|
|
566
|
|
|
16.85
|
|
|
16.52
|
|
|||
|
|
|
|
|
|
631,841
|
|
|
79
|
%
|
|
8,069
|
|
|
16.17
|
|
|
15.98
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total - Operating Portfolio
|
|
|
|
|
|
3,345,712
|
|
|
87
|
%
|
|
31,527
|
|
|
10.83
|
|
|
11.11
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
The Citadel
|
|
Phoenix
|
|
1985
|
|
28,547
|
|
|
63
|
%
|
|
$
|
126
|
|
|
$
|
7.01
|
|
|
$
|
14.68
|
|
Desert Canyon
|
|
Phoenix
|
|
2000
|
|
62,533
|
|
|
74
|
%
|
|
546
|
|
|
11.80
|
|
|
11.80
|
|
|||
Gilbert Tuscany Village
|
|
Phoenix
|
|
2009
|
|
49,415
|
|
|
22
|
%
|
|
202
|
|
|
18.58
|
|
|
25.76
|
|
|||
The MarketPlace At Central
|
|
Phoenix
|
|
2000
|
|
111,130
|
|
|
46
|
%
|
|
440
|
|
|
8.61
|
|
|
8.88
|
|
|||
Total - Development Portfolio
|
|
|
|
|
|
251,625
|
|
|
50
|
%
|
|
1,314
|
|
|
10.44
|
|
|
12.27
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Pinnacle Phase II
|
|
Phoenix
|
|
N/A
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Shops at Starwood Phase III
|
|
Dallas
|
|
N/A
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total - Property Held For Development
(4)
|
|
|
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Grand Totals
|
|
|
|
|
|
3,597,337
|
|
|
84
|
%
|
|
$
|
32,841
|
|
|
$
|
10.87
|
|
|
$
|
11.21
|
|
(1)
|
Calculated as the tenant's actual
December 31, 2011
base rent (defined as cash base rents including abatements) multiplied by 12. Excludes vacant space as of
December 31, 2011
. Because annualized base rental revenue is not derived from historical results that were accounted for in accordance with generally accepted accounting principles, historical results differ from the annualized amounts. Total abatements for leases in effect as of
December 31, 2011
equaled approximately
$164,000
for the month ended
December 31, 2011
.
|
(2)
|
Calculated as annualized base rent divided by net rentable square feet leased at
December 31, 2011
. Excludes vacant space at
December 31, 2011
.
|
(3)
|
Represents (i) the contractual base rent for leases in place as of
December 31, 2011
, calculated on a straight-line basis to reflect changes in rental rates throughout the lease term and amortize free rent periods and abatements, but without regard to tenant improvement allowances and leasing commissions, divided by (ii) square footage under commenced leases of
December 31, 2011
.
|
(4)
|
As of
December 31, 2011
, these properties are held for development with no gross leasable area.
|
Tenant Name
|
|
Location
|
|
Annualized Rental Revenue (in thousands)
|
|
Percentage of Total Annualized Base Rental Revenues
|
|
Initial Lease Date
|
|
Year Expiring
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
Sports Authority
|
|
San Antonio
|
|
$
|
495
|
|
|
1.5
|
%
|
|
1/1/2004
|
|
2015
|
University of Phoenix
|
|
San Antonio
|
|
416
|
|
|
1.3
|
%
|
|
10/18/2010
|
|
2018
|
|
Air Liquide America, L.P.
|
|
Dallas
|
|
375
|
|
|
1.1
|
%
|
|
8/1/2001
|
|
2013
|
|
Safeway Stores, Incorporated
|
|
Phoenix
|
|
344
|
|
|
1.0
|
%
|
|
12/22/2011
|
|
2021
|
|
Walgreen's #3766
|
|
Phoenix
|
|
279
|
|
|
0.8
|
%
|
|
8/9/2011
|
|
2049
|
|
X-Ray X-Press Corporation
|
|
Houston
|
|
272
|
|
|
0.8
|
%
|
|
7/1/1998
|
|
2019
|
|
Rock Solid Images
|
|
Houston
|
|
250
|
|
|
0.8
|
%
|
|
4/1/2004
|
|
2012
|
|
Marshall's
|
|
Houston
|
|
248
|
|
|
0.8
|
%
|
|
5/12/1983
|
|
2013
|
|
Eligibility Services
|
|
Dallas
|
|
236
|
|
|
0.7
|
%
|
|
6/6/2000
|
|
2012
|
|
Albertson's #979
|
|
Phoenix
|
|
235
|
|
|
0.7
|
%
|
|
8/9/2011
|
|
2022
|
|
Merrill Corporation
|
|
Dallas
|
|
234
|
|
|
0.7
|
%
|
|
12/10/2001
|
|
2014
|
|
Fitness Alliance, LLC
|
|
Phoenix
|
|
216
|
|
|
0.7
|
%
|
|
8/17/2011
|
|
2021
|
|
Compass Insurance
|
|
Dallas
|
|
213
|
|
|
0.6
|
%
|
|
1/1/2006
|
|
2013
|
|
River Oaks L-M, Inc.
|
|
Houston
|
|
212
|
|
|
0.6
|
%
|
|
10/15/1993
|
|
2014
|
|
Petsmart, Inc
|
|
San Antonio
|
|
199
|
|
|
0.6
|
%
|
|
1/1/2004
|
|
2018
|
|
|
|
|
|
$
|
4,224
|
|
|
12.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized Base Rent
|
||||||||
|
|
|
|
Gross Leasable Area
|
|
as of December 31, 2011
|
||||||||||
Year
|
|
Number of
Leases |
|
Approximate
Square Feet |
|
Percent
of Total |
|
Amount
(in thousands) |
|
Percent of
Total |
||||||
2012
|
|
303
|
|
|
625,346
|
|
|
17.4
|
%
|
|
$
|
7,350
|
|
|
22.4
|
%
|
2013
|
|
184
|
|
|
571,141
|
|
|
15.9
|
%
|
|
6,599
|
|
|
20.1
|
%
|
|
2014
|
|
171
|
|
|
543,109
|
|
|
15.1
|
%
|
|
5,880
|
|
|
17.9
|
%
|
|
2015
|
|
89
|
|
|
355,534
|
|
|
9.9
|
%
|
|
3,724
|
|
|
11.3
|
%
|
|
2016
|
|
96
|
|
|
332,766
|
|
|
9.3
|
%
|
|
4,022
|
|
|
12.2
|
%
|
|
2017
|
|
20
|
|
|
90,260
|
|
|
2.5
|
%
|
|
795
|
|
|
2.4
|
%
|
|
2018
|
|
15
|
|
|
106,554
|
|
|
3
|
%
|
|
1,380
|
|
|
4.2
|
%
|
|
2019
|
|
7
|
|
|
58,783
|
|
|
1.6
|
%
|
|
681
|
|
|
2.1
|
%
|
|
2020
|
|
7
|
|
|
51,045
|
|
|
1.4
|
%
|
|
588
|
|
|
1.8
|
%
|
|
2021
|
|
9
|
|
|
111,465
|
|
|
3.1
|
%
|
|
833
|
|
|
2.5
|
%
|
|
Total
|
|
901
|
|
|
2,846,003
|
|
|
79.2
|
%
|
|
$
|
31,852
|
|
|
96.9
|
%
|
For the Year Ended December 31, 2011
|
|
High
|
|
Low
|
|
Close
|
||||||
|
|
|
|
|
|
|
||||||
First Quarter
|
|
$
|
14.94
|
|
|
$
|
13.73
|
|
|
$
|
14.31
|
|
Second Quarter
|
|
$
|
14.94
|
|
|
$
|
11.90
|
|
|
$
|
12.72
|
|
Third Quarter
|
|
$
|
13.34
|
|
|
$
|
10.77
|
|
|
$
|
11.14
|
|
Fourth Quarter
|
|
$
|
12.29
|
|
|
$
|
10.05
|
|
|
$
|
11.90
|
|
|
|
|
|
|
|
|
||||||
For the Year Ended December 31, 2010
|
|
High
|
|
Low
|
|
Close
|
||||||
|
|
|
|
|
|
|
||||||
First Quarter
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|||
Second Quarter
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|||
Third Quarter
(1)
|
|
$
|
12.03
|
|
|
$
|
11.32
|
|
|
$
|
11.74
|
|
Fourth Quarter
|
|
$
|
14.94
|
|
|
$
|
11.79
|
|
|
$
|
14.80
|
|
(1)
|
Trading commenced on August 25, 2010.
|
•
|
our funds from operations;
|
•
|
our debt service requirements;
|
•
|
our capital expenditure requirements for our properties;
|
•
|
our taxable income, combined with the annual distribution requirements necessary to maintain REIT qualification;
|
•
|
requirements of Maryland law;
|
•
|
our overall financial condition; and
|
•
|
other factors deemed relevant by our board of trustees of trustees.
|
|
|
Class A Common Shareholders
|
|
Class B Common Shareholders
|
|
Noncontrolling OP Unit Holders
|
|
|
||||||||||||||||||||
Quarter Paid
|
|
Distribution Per Common Share
|
|
Total Amount Paid
|
|
Distribution Per Common Share
|
|
Total Amount Paid
|
|
Distribution Per OP Unit
|
|
Total Amount Paid
|
|
Total Amount Paid
|
||||||||||||||
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
807
|
|
|
$
|
0.2850
|
|
|
$
|
2,386
|
|
|
$
|
0.2850
|
|
|
$
|
430
|
|
|
$
|
3,623
|
|
Third Quarter
|
|
0.2850
|
|
|
974
|
|
|
0.2850
|
|
|
2,141
|
|
|
0.2850
|
|
|
514
|
|
|
3,629
|
|
|||||||
Second Quarter
|
|
0.2850
|
|
|
989
|
|
|
0.2850
|
|
|
1,132
|
|
|
0.2850
|
|
|
515
|
|
|
2,636
|
|
|||||||
First Quarter
|
|
0.2850
|
|
|
989
|
|
|
0.2850
|
|
|
627
|
|
|
0.2850
|
|
|
515
|
|
|
2,131
|
|
|||||||
Total
|
|
$
|
1.1400
|
|
|
$
|
3,759
|
|
|
$
|
1.1400
|
|
|
$
|
6,286
|
|
|
$
|
1.1400
|
|
|
$
|
1,974
|
|
|
$
|
12,019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
989
|
|
|
$
|
0.2850
|
|
|
$
|
627
|
|
|
$
|
0.2850
|
|
|
$
|
514
|
|
|
$
|
2,130
|
|
Third Quarter
|
|
0.2850
|
|
|
992
|
|
|
0.0960
|
|
|
211
|
|
|
0.2850
|
|
|
515
|
|
|
1,718
|
|
|||||||
Second Quarter
|
|
0.3375
|
|
|
1,176
|
|
|
—
|
|
|
—
|
|
|
0.3375
|
|
|
610
|
|
|
1,786
|
|
|||||||
First Quarter
|
|
0.3375
|
|
|
1,163
|
|
|
—
|
|
|
—
|
|
|
0.3375
|
|
|
610
|
|
|
1,773
|
|
|||||||
Total
|
|
$
|
1.2450
|
|
|
$
|
4,320
|
|
|
$
|
0.3810
|
|
|
$
|
838
|
|
|
$
|
1.2450
|
|
|
$
|
2,249
|
|
|
$
|
7,407
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
(in thousands, except per share data)
|
||||||||||||||||||
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
34,915
|
|
|
$
|
31,533
|
|
|
$
|
32,685
|
|
|
$
|
31,201
|
|
|
$
|
29,374
|
|
Property expenses
|
|
13,327
|
|
|
12,283
|
|
|
12,991
|
|
|
12,835
|
|
|
12,236
|
|
|||||
General and administrative
|
|
6,648
|
|
|
4,992
|
|
|
6,072
|
|
|
6,708
|
|
|
6,721
|
|
|||||
Depreciation and amortization
|
|
8,365
|
|
|
7,225
|
|
|
6,958
|
|
|
6,859
|
|
|
6,048
|
|
|||||
Involuntary conversion
|
|
—
|
|
|
(558
|
)
|
|
(1,542
|
)
|
|
358
|
|
|
—
|
|
|||||
Interest expense
|
|
5,728
|
|
|
5,620
|
|
|
5,749
|
|
|
5,857
|
|
|
5,402
|
|
|||||
Interest, dividend and other investment income
|
|
(460
|
)
|
|
(28
|
)
|
|
(36
|
)
|
|
(182
|
)
|
|
(577
|
)
|
|||||
Other expense (income), net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|||||
Income (loss) from continuing operations before loss on disposal of assets and income taxes
|
|
1,307
|
|
|
1,999
|
|
|
2,493
|
|
|
(1,234
|
)
|
|
(486
|
)
|
|||||
Provision for income taxes
|
|
(225
|
)
|
|
(264
|
)
|
|
(222
|
)
|
|
(219
|
)
|
|
(217
|
)
|
|||||
Loss on disposal of assets
|
|
(146
|
)
|
|
(160
|
)
|
|
(196
|
)
|
|
(223
|
)
|
|
(9
|
)
|
|||||
Income (loss) from continuing operations
|
|
936
|
|
|
1,575
|
|
|
2,075
|
|
|
(1,676
|
)
|
|
(712
|
)
|
|||||
Income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(188
|
)
|
|
589
|
|
|||||
Gain on sale of property
|
|
397
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Gain on sale of properties from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,619
|
|
|
—
|
|
|||||
Net income (loss)
|
|
1,333
|
|
|
1,575
|
|
|
2,075
|
|
|
1,755
|
|
|
(123
|
)
|
|||||
Less: net income (loss) attributable to noncontrolling interests
|
|
210
|
|
|
470
|
|
|
733
|
|
|
621
|
|
|
(46
|
)
|
|||||
Net income (loss) attributable to Whitestone REIT
|
|
$
|
1,123
|
|
|
$
|
1,105
|
|
|
$
|
1,342
|
|
|
$
|
1,134
|
|
|
$
|
(77
|
)
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
(in thousands, except per share data)
|
||||||||||||||||||
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
||||||||||
Earnings per share - basic
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations attributable to Whitestone REIT excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.41
|
|
|
$
|
(0.33
|
)
|
|
$
|
(0.14
|
)
|
Income from discontinued operations attributable to Whitestone REIT
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.68
|
|
|
0.12
|
|
|||||
Net income (loss) attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.41
|
|
|
$
|
0.35
|
|
|
$
|
(0.02
|
)
|
Earnings per share - diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income (loss) from continuing operations attributable to Whitestone REIT excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.40
|
|
|
$
|
(0.33
|
)
|
|
$
|
(0.14
|
)
|
Income from discontinued operations attributable to Whitestone REIT
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.68
|
|
|
0.12
|
|
|||||
Net income (loss) attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.40
|
|
|
$
|
0.35
|
|
|
$
|
(0.02
|
)
|
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real estate (net)
|
|
$
|
246,888
|
|
|
$
|
165,398
|
|
|
$
|
158,398
|
|
|
$
|
150,847
|
|
|
$
|
146,460
|
|
Real estate (net), discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,932
|
|
|||||
Other assets
|
|
26,605
|
|
|
31,047
|
|
|
23,602
|
|
|
27,098
|
|
|
20,752
|
|
|||||
Total assets
|
|
$
|
273,493
|
|
|
$
|
196,445
|
|
|
$
|
182,000
|
|
|
$
|
177,945
|
|
|
$
|
175,144
|
|
Liabilities
|
|
$
|
142,786
|
|
|
$
|
112,162
|
|
|
$
|
115,141
|
|
|
$
|
110,773
|
|
|
$
|
94,262
|
|
Whitestone REIT shareholders' equity
|
|
115,958
|
|
|
62,708
|
|
|
43,590
|
|
|
45,891
|
|
|
52,843
|
|
|||||
Noncontrolling interest in subsidiary
|
|
14,749
|
|
|
21,575
|
|
|
23,269
|
|
|
21,281
|
|
|
28,039
|
|
|||||
|
|
$
|
273,493
|
|
|
$
|
196,445
|
|
|
$
|
182,000
|
|
|
$
|
177,945
|
|
|
$
|
175,144
|
|
Other Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from issuance of common shares
|
|
$
|
59,683
|
|
|
$
|
22,970
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
261
|
|
Acquisitions of and additions to real estate
|
|
88,903
|
|
|
12,768
|
|
|
12,855
|
|
|
5,153
|
|
|
10,205
|
|
|||||
Dividends per share
(1)
|
|
1.09
|
|
|
1.17
|
|
|
1.35
|
|
|
1.59
|
|
|
1.80
|
|
|||||
Funds from operations
(2)
|
|
8,707
|
|
|
8,432
|
|
|
8,618
|
|
|
4,236
|
|
|
6,001
|
|
|||||
Operating Portfolio Occupancy at year end
|
|
87
|
%
|
|
86
|
%
|
|
82
|
%
|
|
84
|
%
|
|
86
|
%
|
|||||
Average aggregate gross leasable area
|
|
3,366
|
|
|
3,058
|
|
|
3,039
|
|
|
3,008
|
|
|
3,093
|
|
|||||
Average rent per square foot
|
|
$
|
10.37
|
|
|
$
|
10.31
|
|
|
$
|
10.76
|
|
|
$
|
10.37
|
|
|
$
|
9.50
|
|
(1)
The dividends per share represent total cash payments divided by weighted average common shares.
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
(2)
We believe that Funds From Operations (“FFO”) is an appropriate supplemental measure of operating performance because it helps our investors compare our operating performance relative to other REITs. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) available to common shareholders computed in accordance with GAAP, excluding gains or losses from sales of operating properties and extraordinary items, plus depreciation and amortization of real estate assets, including our share of unconsolidated partnerships and joint ventures. We calculate FFO in a manner consistent with the NAREIT definition.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
(in thousands, except per share data)
|
||||||||||||||||||
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
||||||||||
Net income (loss) attributable to Whitestone REIT
|
|
$
|
1,123
|
|
|
$
|
1,105
|
|
|
$
|
1,342
|
|
|
$
|
1,134
|
|
|
$
|
(77
|
)
|
Depreciation and amortization of real estate assets
(1)
|
|
7,625
|
|
|
6,697
|
|
|
6,347
|
|
|
5,877
|
|
|
6,108
|
|
|||||
(Gain) loss on sale or disposal of assets
(1)
|
|
(251
|
)
|
|
160
|
|
|
196
|
|
|
(3,396
|
)
|
|
16
|
|
|||||
Net income (loss) attributable to noncontrolling interests
|
|
210
|
|
|
470
|
|
|
733
|
|
|
621
|
|
|
(46
|
)
|
|||||
FFO
|
|
$
|
8,707
|
|
|
$
|
8,432
|
|
|
$
|
8,618
|
|
|
$
|
4,236
|
|
|
$
|
6,001
|
|
•
|
twenty-one
retail properties containing approximately
1.5 million
square feet of gross leasable area and having a total carrying amount (net of accumulated depreciation) of
$140.0 million
;
|
•
|
seven
office properties containing approximately
0.6 million
square feet of gross leasable area and having a total carrying amount (net of accumulated depreciation) of
$44.4 million
; and
|
•
|
eleven
office/flex properties containing approximately
1.2 million
square feet of gross leasable area and having a total carrying amount (net of accumulated depreciation) of
$40.8 million
.
|
•
|
four
retail properties containing approximately
0.3 million
square feet of leasable space and having a total carrying amount (net of accumulated depreciation) of
$18.9 million
; and
|
•
|
two
parcels of land held for future development having a total carrying amount of
$2.8 million
.
|
•
|
Cash flow from operations of
$8,452,000
for the year ended
December 31, 2011
;
|
•
|
Net proceeds of
$59,683,000
from issuance of Class B common shares;
|
•
|
Net proceeds of
$13,295,000
from issuance of notes payable net of origination costs;
|
•
|
Proceeds from sales of marketable securities of
$7,252,000
;
|
•
|
Net proceeds of
$1,567,000
from the sale of our Greens Road property;
|
•
|
Payment of dividends and distributions to common shareholders and OP Unit holders of
$12,019,000
;
|
•
|
Investments in marketable securities of
$13,520,000
;
|
•
|
Real estate acquisitions of
$65,910,000
;
|
•
|
Additions to real estate of
$7,568,000
;
|
•
|
Payments of loans of
$3,128,000
.
|
|
|
December 31,
|
||||||
Description
|
|
2011
|
|
2010
|
||||
Fixed rate notes
|
|
|
|
|
||||
$1.4 million 5.00% Note, Due 2012
|
|
$
|
1,318
|
|
|
$
|
—
|
|
$14.1 million 5.695% Note, due 2013
|
|
14,110
|
|
|
—
|
|
||
$3.0 million 6.00% Note, due 2021
(1)
|
|
2,978
|
|
|
—
|
|
||
$10.0 million 6.04% Note, due 2014
|
|
9,326
|
|
|
9,498
|
|
||
$1.5 million 6.50% Note, due 2014
|
|
1,471
|
|
|
1,496
|
|
||
$11.2 million 6.52% Note, due 2015
|
|
10,763
|
|
|
10,908
|
|
||
$21.4 million 6.53% Notes, due 2013
|
|
19,524
|
|
|
20,142
|
|
||
$24.5 million 6.56% Note, due 2013
|
|
23,597
|
|
|
24,030
|
|
||
$9.9 million 6.63% Notes, due 2014
|
|
9,221
|
|
|
9,498
|
|
||
$0.5 million 3.25% Notes, due 2012
|
|
23
|
|
|
13
|
|
||
Floating rate notes
|
|
|
|
|
||||
Unsecured line of credit LIBOR plus 3.50% to 4.50%, due 2013
|
|
11,000
|
|
|
—
|
|
||
$26.9 million LIBOR plus 2.60% Note, due 2013
|
|
24,559
|
|
|
25,356
|
|
||
|
|
$
|
127,890
|
|
|
$
|
100,941
|
|
(1)
|
The 6.00% interest rate is fixed through March 30, 2016. On March 31, 2016 the interest rate will reset to the rate of interest for a five year balloon note with a thirty year amortization as published by the Federal Home Loan Bank.
|
|
|
Amount Due
|
||
Year
|
|
(in thousands)
|
||
|
|
|
||
2012
|
|
$
|
4,276
|
|
2013
|
|
91,298
|
|
|
2014
|
|
19,191
|
|
|
2015
|
|
10,315
|
|
|
2016
|
|
49
|
|
|
2017 and thereafter
|
|
2,761
|
|
|
Total
|
|
$
|
127,890
|
|
|
|
|
|
Payment due by period (in thousands)
|
||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less than 1
year (2012)
|
|
1 - 3 years
(2013 - 2014)
|
|
3 - 5 years
(2015 - 2016)
|
|
More than
5 years
(after 2016)
|
||||||||||
Long-Term Debt - Principal
|
|
$
|
127,890
|
|
|
$
|
4,276
|
|
|
$
|
110,489
|
|
|
$
|
10,364
|
|
|
$
|
2,761
|
|
Long-Term Debt - Fixed Interest
|
|
13,575
|
|
|
5,784
|
|
|
6,279
|
|
|
837
|
|
|
675
|
|
|||||
Long-Term Debt - Variable Interest
(1)
|
|
1,924
|
|
|
1,104
|
|
|
820
|
|
|
—
|
|
|
—
|
|
|||||
Operating Lease Obligations
|
|
53
|
|
|
29
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
143,442
|
|
|
$
|
11,193
|
|
|
$
|
117,612
|
|
|
$
|
11,201
|
|
|
$
|
3,436
|
|
(1)
|
As of December 31, 2011, we had two loans totaling $35.6 million which bore interest at a floating rate. The variable interest rate payments are based on LIBOR plus 2.60% to LIBOR plus 4.50%. The information in the table above reflects our projected interest rate obligations for the floating rate payments based on one-month LIBOR as of December 31, 2011, of 0.26%.
|
|
|
Class A Common Shareholders
|
|
Class B Common Shareholders
|
|
Noncontrolling OP Unit Holders
|
|
Total
|
||||||||||||||||||||
Quarter Paid
|
|
Distribution Per Common Share
|
|
Total Amount Paid
|
|
Distribution Per Common Share
|
|
Total Amount Paid
|
|
Distribution Per OP Unit
|
|
Total Amount Paid
|
|
Total Amount Paid
|
||||||||||||||
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
807
|
|
|
$
|
0.2850
|
|
|
$
|
2,386
|
|
|
$
|
0.2850
|
|
|
$
|
430
|
|
|
$
|
3,623
|
|
Third Quarter
|
|
0.2850
|
|
|
974
|
|
|
0.2850
|
|
|
2,141
|
|
|
0.2850
|
|
|
514
|
|
|
3,629
|
|
|||||||
Second Quarter
|
|
0.2850
|
|
|
989
|
|
|
0.2850
|
|
|
1,132
|
|
|
0.2850
|
|
|
515
|
|
|
2,636
|
|
|||||||
First Quarter
|
|
0.2850
|
|
|
989
|
|
|
0.2850
|
|
|
627
|
|
|
0.2850
|
|
|
515
|
|
|
2,131
|
|
|||||||
Total
|
|
$
|
1.1400
|
|
|
$
|
3,759
|
|
|
$
|
1.1400
|
|
|
$
|
6,286
|
|
|
$
|
1.1400
|
|
|
$
|
1,974
|
|
|
$
|
12,019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
989
|
|
|
$
|
0.2850
|
|
|
$
|
627
|
|
|
$
|
0.2850
|
|
|
$
|
514
|
|
|
$
|
2,130
|
|
Third Quarter
|
|
0.2850
|
|
|
992
|
|
|
0.0960
|
|
|
211
|
|
|
0.2850
|
|
|
515
|
|
|
1,718
|
|
|||||||
Second Quarter
|
|
0.3375
|
|
|
1,176
|
|
|
—
|
|
|
—
|
|
|
0.3375
|
|
|
610
|
|
|
1,786
|
|
|||||||
First Quarter
|
|
0.3375
|
|
|
1,163
|
|
|
—
|
|
|
—
|
|
|
0.3375
|
|
|
610
|
|
|
1,773
|
|
|||||||
Total
|
|
$
|
1.2450
|
|
|
$
|
4,320
|
|
|
$
|
0.3810
|
|
|
$
|
838
|
|
|
$
|
1.2450
|
|
|
$
|
2,249
|
|
|
$
|
7,407
|
|
|
|
Year Ended December 31,
|
||||||
|
|
2011
|
|
2010
|
||||
Number of properties owned and operated
|
|
45
|
|
|
38
|
|
||
Aggregate gross leasable area (sq. ft.)
(1)
|
|
3,597,337
|
|
|
3,162,020
|
|
||
Ending occupancy rate - operating portfolio
(2)
|
|
87
|
%
|
|
86
|
%
|
||
Ending occupancy rate - all properties
|
|
84
|
%
|
|
84
|
%
|
||
|
|
|
|
|
||||
Total property revenues
|
|
$
|
34,915
|
|
|
$
|
31,533
|
|
Total property expenses
|
|
13,327
|
|
|
12,283
|
|
||
Total other expenses
|
|
20,281
|
|
|
17,251
|
|
||
Provision for income taxes
|
|
225
|
|
|
264
|
|
||
Loss on disposal of assets
|
|
146
|
|
|
160
|
|
||
Income from continuing operations
|
|
936
|
|
|
1,575
|
|
||
Gain on sale of property
|
|
397
|
|
|
—
|
|
||
Net income
|
|
1,333
|
|
|
1,575
|
|
||
Less: Net income attributable to noncontrolling interests
|
|
210
|
|
|
470
|
|
||
Net income attributable to Whitestone REIT
|
|
$
|
1,123
|
|
|
$
|
1,105
|
|
|
|
|
|
|
||||
Funds from operations
(3)
|
|
$
|
8,707
|
|
|
$
|
8,432
|
|
Property net operating income
(4)
|
|
21,588
|
|
|
19,250
|
|
||
Distributions paid on common shares and OP Units
|
|
12,019
|
|
|
7,407
|
|
||
Per Class A common share and OP Unit
|
|
$
|
1.14
|
|
|
$
|
1.25
|
|
Per Class B common share
(5)
|
|
$
|
1.14
|
|
|
$
|
0.38
|
|
Distributions paid as a percentage of funds from operations
|
|
138
|
%
|
|
88
|
%
|
(1)
|
During the first quarter of 2010, we concluded that approximately 25,000 square feet at our Kempwood Plaza and Centre South locations were no longer leasable, therefore such area is no longer included in the gross leasable area.
|
(2)
|
Excludes (i) new acquisitions, through the earlier of attainment of 90% occupancy or 18 months of ownership, and (ii) properties that are undergoing significant redevelopment or re-tenanting.
|
(3)
|
For a reconciliation of funds from operations to net income, see "Funds From Operations" below.
|
(4)
|
For a reconciliation of property net operating income to net income, see "Property Net Operating Income" below.
|
(5)
|
Dividend rate is the same as Class A, but represents a partial year during 2010 for Class B common shares issued August 26, 2010.
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2011
|
|
2010
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Real estate taxes
|
|
$
|
4,668
|
|
|
$
|
3,925
|
|
|
$
|
743
|
|
|
19
|
%
|
Utilities
|
|
2,510
|
|
|
2,277
|
|
|
233
|
|
|
10
|
%
|
|||
Contract services
|
|
2,312
|
|
|
2,140
|
|
|
172
|
|
|
8
|
%
|
|||
Repairs and maintenance
|
|
1,222
|
|
|
1,403
|
|
|
(181
|
)
|
|
(13
|
)%
|
|||
Bad debt
|
|
615
|
|
|
536
|
|
|
79
|
|
|
15
|
%
|
|||
Labor and other
|
|
2,000
|
|
|
2,002
|
|
|
(2
|
)
|
|
—
|
%
|
|||
Total property expenses
|
|
$
|
13,327
|
|
|
$
|
12,283
|
|
|
$
|
1,044
|
|
|
8
|
%
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||
|
|
Same Store
|
|
New Store
|
|
Total
|
||||||||||||||||||
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
||||||||||||
Property revenues
|
|
$
|
32,297
|
|
|
$
|
31,419
|
|
|
$
|
2,618
|
|
|
$
|
114
|
|
|
$
|
34,915
|
|
|
$
|
31,533
|
|
Property expenses
|
|
12,062
|
|
|
12,117
|
|
|
1,265
|
|
|
166
|
|
|
13,327
|
|
|
12,283
|
|
||||||
Property net operating income
|
|
$
|
20,235
|
|
|
$
|
19,302
|
|
|
$
|
1,353
|
|
|
$
|
(52
|
)
|
|
$
|
21,588
|
|
|
$
|
19,250
|
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2011
|
|
2010
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
General and administrative
|
|
$
|
6,648
|
|
|
$
|
4,992
|
|
|
$
|
1,656
|
|
|
33
|
%
|
Depreciation & amortization
|
|
8,365
|
|
|
7,225
|
|
|
1,140
|
|
|
16
|
%
|
|||
Involuntary conversion
|
|
—
|
|
|
(558
|
)
|
|
558
|
|
|
(100
|
)%
|
|||
Interest expense
|
|
5,728
|
|
|
5,620
|
|
|
108
|
|
|
2
|
%
|
|||
Interest, dividend and other investment income
|
|
(460
|
)
|
|
(28
|
)
|
|
(432
|
)
|
|
1,543
|
%
|
|||
Total other expenses
|
|
$
|
20,281
|
|
|
$
|
17,251
|
|
|
$
|
3,030
|
|
|
18
|
%
|
|
|
Year Ended December 31,
|
||||||
|
|
2010
|
|
2009
|
||||
Number of properties owned and operated
|
|
38
|
|
|
36
|
|
||
Aggregate gross leasable area (sq. ft.)
(1)
|
|
3,162,020
|
|
|
3,039,044
|
|
||
Ending occupancy rate - operating portfolio
(2)
|
|
86
|
%
|
|
82
|
%
|
||
Ending occupancy rate - all properties
|
|
84
|
%
|
|
82
|
%
|
||
|
|
|
|
|
||||
Total property revenues
|
|
$
|
31,533
|
|
|
$
|
32,685
|
|
Total property expenses
|
|
12,283
|
|
|
12,991
|
|
||
Total other expenses
|
|
17,251
|
|
|
17,201
|
|
||
Provision for income taxes
|
|
264
|
|
|
222
|
|
||
Loss on disposal of assets
|
|
160
|
|
|
196
|
|
||
Net income
|
|
1,575
|
|
|
2,075
|
|
||
Less: Net income attributable to noncontrolling interests
|
|
470
|
|
|
733
|
|
||
Net income attributable to Whitestone REIT
|
|
$
|
1,105
|
|
|
$
|
1,342
|
|
|
|
|
|
|
||||
Funds from operations
(3)
|
|
$
|
8,432
|
|
|
$
|
8,618
|
|
Property net operating income
(4)
|
|
19,250
|
|
|
19,694
|
|
||
Distributions paid on common shares and OP Units
|
|
7,407
|
|
|
6,926
|
|
||
Per Class A common share and OP Unit
|
|
$
|
1.25
|
|
|
$
|
1.35
|
|
Per Class B common share
(5)
|
|
$
|
0.38
|
|
|
$
|
—
|
|
Distributions paid as a percentage of funds from operations
|
|
88
|
%
|
|
80
|
%
|
(1)
|
During the first quarter of 2010, we concluded that approximately 25,000 square feet at our Kempwood Plaza and Centre South locations were no longer leasable, therefore such area is no longer included in the gross leasable area.
|
(2)
|
Excludes (i) new acquisitions, through the earlier of attainment of 90% occupancy or 18 months of ownership, and (ii) properties that are undergoing significant redevelopment or re-tenanting.
|
(3)
|
For a reconciliation of funds from operations to net income, see "Funds From Operations" below.
|
(4)
|
For a reconciliation of property net operating income to net income, see "Property Net Operating Income" below.
|
(5)
|
Dividend rate is the same as Class A, but represents a partial year for Class B common shares issued August 26, 2010.
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2010
|
|
2009
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Real estate taxes
|
|
$
|
3,925
|
|
|
$
|
4,472
|
|
|
$
|
(547
|
)
|
|
(12
|
)%
|
Utilities
|
|
2,277
|
|
|
2,387
|
|
|
(110
|
)
|
|
(5
|
)%
|
|||
Contract services
|
|
2,140
|
|
|
2,108
|
|
|
32
|
|
|
2
|
%
|
|||
Repairs and maintenance
|
|
1,403
|
|
|
1,408
|
|
|
(5
|
)
|
|
—
|
%
|
|||
Bad debt
|
|
536
|
|
|
877
|
|
|
(341
|
)
|
|
(39
|
)%
|
|||
Labor and other
|
|
2,002
|
|
|
1,739
|
|
|
263
|
|
|
15
|
%
|
|||
Total property expenses
|
|
$
|
12,283
|
|
|
$
|
12,991
|
|
|
$
|
(708
|
)
|
|
(5
|
)%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2010
|
|
2009
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
General and administrative
|
|
$
|
4,992
|
|
|
$
|
6,072
|
|
|
$
|
(1,080
|
)
|
|
(18
|
)%
|
Depreciation and amortization
|
|
7,225
|
|
|
6,958
|
|
|
267
|
|
|
4
|
%
|
|||
Involuntary conversion
|
|
(558
|
)
|
|
(1,542
|
)
|
|
984
|
|
|
(64
|
)%
|
|||
Interest expense
|
|
5,620
|
|
|
5,749
|
|
|
(129
|
)
|
|
(2
|
)%
|
|||
Interest, dividend and other investment income
|
|
(28
|
)
|
|
(36
|
)
|
|
8
|
|
|
(22
|
)%
|
|||
Total other expenses
|
|
$
|
17,251
|
|
|
$
|
17,201
|
|
|
$
|
50
|
|
|
—
|
%
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
FFO AND FFO-CORE
|
|
|
|
|
|
|
||||||
Net income attributable to Whitestone REIT
|
|
$
|
1,123
|
|
|
$
|
1,105
|
|
|
$
|
1,342
|
|
Depreciation and amortization of real estate assets
|
|
7,625
|
|
|
6,697
|
|
|
6,347
|
|
|||
Loss (gain) on disposal of assets
(1)
|
|
(251
|
)
|
|
160
|
|
|
196
|
|
|||
Net income attributable to noncontrolling interests
|
|
210
|
|
|
470
|
|
|
733
|
|
|||
FFO
|
|
$
|
8,707
|
|
|
$
|
8,432
|
|
|
$
|
8,618
|
|
|
|
|
|
|
|
|
||||||
Acquisition costs
|
|
$
|
666
|
|
|
$
|
46
|
|
|
$
|
75
|
|
Gain on insurance claim settlement
(2)
|
|
—
|
|
|
(558
|
)
|
|
(1,934
|
)
|
|||
Legal and professional costs (recoveries), net
|
|
254
|
|
|
—
|
|
|
—
|
|
|||
FFO-Core
|
|
$
|
9,627
|
|
|
$
|
7,920
|
|
|
$
|
6,759
|
|
(1)
|
Including amounts for discontinued operations.
|
(2)
|
$392 included in rental revenue for the year ended December 31, 2009.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
|
|
|
|
|
|
|
||||||
PROPERTY NET OPERATING INCOME ("NOI")
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
Net income attributable to Whitestone REIT
|
|
$
|
1,123
|
|
|
$
|
1,105
|
|
|
$
|
1,342
|
|
General and administrative expenses
|
|
6,648
|
|
|
4,992
|
|
|
6,072
|
|
|||
Depreciation and amortization
|
|
8,365
|
|
|
7,225
|
|
|
6,958
|
|
|||
Involuntary conversion
|
|
—
|
|
|
(558
|
)
|
|
(1,542
|
)
|
|||
Interest expense
|
|
5,728
|
|
|
5,620
|
|
|
5,749
|
|
|||
Interest, dividend and other investment income
|
|
(460
|
)
|
|
(28
|
)
|
|
(36
|
)
|
|||
Provision for income taxes
|
|
225
|
|
|
264
|
|
|
222
|
|
|||
Loss on sale or disposal of assets
|
|
146
|
|
|
160
|
|
|
196
|
|
|||
Gain on sale of property
|
|
(397
|
)
|
|
—
|
|
|
—
|
|
|||
Net income attributable to noncontrolling interests
|
|
210
|
|
|
470
|
|
|
733
|
|
|||
NOI
|
|
$
|
21,588
|
|
|
$
|
19,250
|
|
|
$
|
19,694
|
|
Plan Category
|
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
|
|
Weighted-average exercise price of outstanding options, warrants and rights
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
|
|||||
|
|
(a)
|
|
(b)
|
|
(c)
|
|
|||||
Equity compensation plans approved by security holders
|
|
—
|
|
(1
|
)
|
$
|
—
|
|
|
1,245,638
|
|
(2)
|
|
|
|
|
|
|
|
|
|||||
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
(3)
|
||
|
|
|
|
|
|
|
|
|||||
Total
|
|
—
|
|
|
$
|
—
|
|
|
1,245,638
|
|
|
(1)
|
Excludes 632,589 Class A common shares subject to outstanding restricted common share units granted pursuant to our 2008 Long-Term Equity Incentive Ownership Plan, as amended (the "Plan").
|
(2)
|
Pursuant the Plan, the maximum aggregate number of Class B common shares that may be issued under the Plan will be increased upon each issuance of Class A and Class B common shares by the Company so that at any time the maximum number of shares that may be issued under the Plan shall equal 12.5% of the aggregate number of Class A and Class B common shares of the Company and OP units issued and outstanding (other than units issued to or held by the Company).
|
(3)
|
Excludes 8,333 restricted Class A common shares issued to trustees outside the Plan. See Note 14 to our accompanying consolidated financial statements for more information.
|
1.
|
Financial Statements.
The list of our financial statements filed as part of this Annual Report on Form 10-K is set forth on page F-1 herein.
|
2.
|
Financial Statement Schedules.
|
a.
|
Schedule II - Valuation and Qualifying Accounts
|
b.
|
Schedule III - Real Estate and Accumulated Depreciation
|
3.
|
Exhibits.
The list of exhibits filed as part of this Annual Report on Form 10-K in response to Item 601 of Regulation S-K is submitted on the Exhibit Index attached hereto and incorporated herein by reference.
|
|
|
|
|
WHITESTONE REIT
|
Date:
|
February 29, 2012
|
By:
|
By:
|
/s/ James C. Mastandrea
|
|
|
|
|
James C. Mastandrea, Chairman and CEO
|
February 29, 2012
|
/s/ James C. Mastandrea
|
|
|
James C. Mastandrea, Chairman and CEO
|
|
|
(Principal Executive Officer)
|
|
|
|
|
February 29, 2012
|
/s/ David K. Holeman
|
|
|
David K. Holeman, Chief Financial Officer
|
|
|
(Principal Financial and Principal Accounting Officer)
|
|
|
|
|
February 29, 2012
|
/s/ Daryl J. Carter
|
|
|
Daryl J. Carter, Trustee
|
|
|
|
|
February 29, 2012
|
/s/ Daniel G. DeVos
|
|
|
Daniel G. DeVos, Trustee
|
|
|
|
|
February 29, 2012
|
/s/ Donald F. Keating
|
|
|
Donald F. Keating, Trustee
|
|
|
|
|
February 29, 2012
|
/s/ Jack L. Mahaffey
|
|
|
Jack L. Mahaffey, Trustee
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
Whitestone REIT and Subsidiaries
|
||||||||
CONSOLIDATED BALANCE SHEETS
|
||||||||
(in thousands, except per share data)
|
||||||||
|
|
|
||||||
|
|
December 31,
|
||||||
|
|
2011
|
|
2010
|
||||
ASSETS
|
||||||||
Real estate assets, at cost:
|
|
|
|
|
||||
Property
|
|
$
|
292,360
|
|
|
$
|
204,954
|
|
Accumulated depreciation
|
|
(45,472
|
)
|
|
(39,556
|
)
|
||
Total real estate assets
|
|
246,888
|
|
|
165,398
|
|
||
Cash and cash equivalents
|
|
5,695
|
|
|
17,591
|
|
||
Marketable securities
|
|
5,131
|
|
|
—
|
|
||
Escrows and acquisition deposits
|
|
4,996
|
|
|
4,385
|
|
||
Accrued rents and accounts receivable, net of allowance for doubtful accounts
|
|
6,053
|
|
|
4,726
|
|
||
Unamortized lease commissions and loan costs
|
|
3,755
|
|
|
3,598
|
|
||
Prepaid expenses and other assets
|
|
975
|
|
|
747
|
|
||
Total assets
|
|
$
|
273,493
|
|
|
$
|
196,445
|
|
LIABILITIES AND EQUITY
|
||||||||
Liabilities:
|
|
|
|
|
||||
Notes payable
|
|
$
|
127,890
|
|
|
$
|
100,941
|
|
Accounts payable and accrued expenses
|
|
9,017
|
|
|
7,292
|
|
||
Tenants' security deposits
|
|
2,232
|
|
|
1,796
|
|
||
Dividends and distributions payable
|
|
3,647
|
|
|
2,133
|
|
||
Total liabilities
|
|
142,786
|
|
|
112,162
|
|
||
Commitments and contingencies
|
|
|
|
|
||||
Equity:
|
|
|
|
|
||||
Preferred shares, $0.001 par value per share; 50,000,000 shares authorized; none issued and outstanding at December 31, 2011 and December 31, 2010
|
|
—
|
|
|
—
|
|
||
Class A common shares, $0.001 par value per share; 50,000,000 shares authorized; 2,603,292 and 3,471,187 issued and outstanding as of December 31, 2011 and 2010, respectively
|
|
2
|
|
|
3
|
|
||
Class B common shares, $0.001 par value per share; 350,000,000 shares authorized; 8,834,563 and 2,200,000 issued and outstanding as of December 31, 2011 and 2010, respectively
|
|
8
|
|
|
2
|
|
||
Additional paid-in capital
|
|
158,127
|
|
|
93,357
|
|
||
Accumulated other comprehensive loss
|
|
(1,119
|
)
|
|
—
|
|
||
Accumulated deficit
|
|
(41,060
|
)
|
|
(30,654
|
)
|
||
Total Whitestone REIT shareholders' equity
|
|
115,958
|
|
|
62,708
|
|
||
Noncontrolling interest in subsidiary
|
|
14,749
|
|
|
21,575
|
|
||
Total equity
|
|
130,707
|
|
|
84,283
|
|
||
Total liabilities and equity
|
|
$
|
273,493
|
|
|
$
|
196,445
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
|
|
|
|
|
|
|
||||||
Property revenues
|
|
|
|
|
|
|
||||||
Rental revenues
|
|
$
|
27,814
|
|
|
$
|
25,901
|
|
|
$
|
26,449
|
|
Other revenues
|
|
7,101
|
|
|
5,632
|
|
|
6,236
|
|
|||
Total property revenues
|
|
34,915
|
|
|
31,533
|
|
|
32,685
|
|
|||
|
|
|
|
|
|
|
||||||
Property expenses
|
|
|
|
|
|
|
|
|
|
|||
Property operation and maintenance
|
|
8,659
|
|
|
8,358
|
|
|
8,519
|
|
|||
Real estate taxes
|
|
4,668
|
|
|
3,925
|
|
|
4,472
|
|
|||
Total property expenses
|
|
13,327
|
|
|
12,283
|
|
|
12,991
|
|
|||
|
|
|
|
|
|
|
||||||
Other expenses (income)
|
|
|
|
|
|
|
|
|
|
|||
General and administrative
|
|
6,648
|
|
|
4,992
|
|
|
6,072
|
|
|||
Depreciation & amortization
|
|
8,365
|
|
|
7,225
|
|
|
6,958
|
|
|||
Involuntary conversion
|
|
—
|
|
|
(558
|
)
|
|
(1,542
|
)
|
|||
Interest expense
|
|
5,728
|
|
|
5,620
|
|
|
5,749
|
|
|||
Interest, dividend and other investment income
|
|
(460
|
)
|
|
(28
|
)
|
|
(36
|
)
|
|||
Total other expense
|
|
20,281
|
|
|
17,251
|
|
|
17,201
|
|
|||
|
|
|
|
|
|
|
||||||
Income before loss on sale or disposal of assets and income taxes
|
|
1,307
|
|
|
1,999
|
|
|
2,493
|
|
|||
|
|
|
|
|
|
|
||||||
Provision for income taxes
|
|
(225
|
)
|
|
(264
|
)
|
|
(222
|
)
|
|||
Loss on sale or disposal of assets
|
|
(146
|
)
|
|
(160
|
)
|
|
(196
|
)
|
|||
Income before gain on sale of property
|
|
936
|
|
|
1,575
|
|
|
2,075
|
|
|||
|
|
|
|
|
|
|
||||||
Gain on sale of property
|
|
397
|
|
|
—
|
|
|
—
|
|
|||
Net income
|
|
1,333
|
|
|
1,575
|
|
|
2,075
|
|
|||
|
|
|
|
|
|
|
||||||
Less: Net income attributable to noncontrolling interests
|
|
210
|
|
|
470
|
|
|
733
|
|
|||
|
|
|
|
|
|
|
||||||
Net income attributable to Whitestone REIT
|
|
$
|
1,123
|
|
|
$
|
1,105
|
|
|
$
|
1,342
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
|
|
|
|
|
|
|
||||||
Earnings per share - basic
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.41
|
|
|
|
|
|
|
|
|
||||||
Earnings per share - diluted
|
|
|
|
|
|
|
|
|
|
|||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.40
|
|
|
|
|
|
|
|
|
||||||
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
9,028
|
|
|
4,012
|
|
|
3,236
|
|
|||
Diluted
|
|
9,042
|
|
|
4,041
|
|
|
3,302
|
|
|||
|
|
|
|
|
|
|
||||||
Dividends declared per Class A common share
|
|
$
|
1.14
|
|
|
$
|
1.19
|
|
|
$
|
1.35
|
|
Dividends declared per Class B common share
(1)
|
|
1.14
|
|
|
0.57
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
||||||
Condensed Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
1,333
|
|
|
$
|
1,575
|
|
|
$
|
2,075
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive gain (loss):
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
||||||
Unrealized loss on available-for-sale marketable securities
|
|
(1,329
|
)
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
||||||
Comprehensive income
|
|
4
|
|
|
1,575
|
|
|
2,075
|
|
|||
|
|
|
|
|
|
|
||||||
Less: Comprehensive income attributable to noncontrolling interests
|
|
1
|
|
|
470
|
|
|
733
|
|
|||
|
|
|
|
|
|
|
||||||
Comprehensive income attributable to Whitestone REIT
|
|
$
|
3
|
|
|
$
|
1,105
|
|
|
$
|
1,342
|
|
(1)
|
Dividend rate is the same as Class A, but represents a partial year for Class B common shares issued August 26, 2010.
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
|
|
Class A
|
|
Class B
|
|
Additional
|
|
|
|
Other
|
|
Total
|
|
Noncontrolling
|
|
|
|||||||||||||||||||||||||
|
|
Common Shares
|
|
Common Shares
|
|
Paid-in
|
|
Accumulated
|
|
Comprehensive
|
|
Shareholders'
|
|
Interests
|
|
Total
|
|||||||||||||||||||||||||
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Capital
|
|
Deficit
|
|
Loss
|
|
Equity
|
|
Units
|
|
Dollars
|
|
Equity
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Balance, December 31, 2008
|
|
3,236
|
|
|
$
|
10
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
69,188
|
|
|
$
|
(23,307
|
)
|
|
$
|
—
|
|
|
$
|
45,891
|
|
|
1,580
|
|
|
$
|
21,281
|
|
|
$
|
67,172
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
OP units issued at $15.45 per unit in connection with property acquisition
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
235
|
|
|
3,625
|
|
|
3,625
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Share-based compensation
|
|
210
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
764
|
|
|
—
|
|
|
—
|
|
|
764
|
|
|
—
|
|
|
—
|
|
|
764
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Dividends and distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,407
|
)
|
|
—
|
|
|
(4,407
|
)
|
|
—
|
|
|
(2,370
|
)
|
|
(6,777
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,342
|
|
|
—
|
|
|
1,342
|
|
|
—
|
|
|
733
|
|
|
2,075
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Balance, December 31, 2009
|
|
3,446
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
69,952
|
|
|
(26,372
|
)
|
|
—
|
|
|
43,590
|
|
|
1,815
|
|
|
23,269
|
|
|
66,859
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Change in par value of common shares
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Issuance of common shares
(1)
|
|
—
|
|
|
—
|
|
|
2,200
|
|
|
2
|
|
|
22,968
|
|
|
—
|
|
|
—
|
|
|
22,970
|
|
|
—
|
|
|
—
|
|
|
22,970
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Share-based compensation
|
|
41
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
73
|
|
|
—
|
|
|
—
|
|
|
73
|
|
|
—
|
|
|
—
|
|
|
73
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Dividends and distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,387
|
)
|
|
—
|
|
|
(5,387
|
)
|
|
—
|
|
|
(2,164
|
)
|
|
(7,551
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Repurchase of common shares
(2)
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(249
|
)
|
|
—
|
|
|
—
|
|
|
(249
|
)
|
|
—
|
|
|
—
|
|
|
(249
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Reclassification of dividend reinvestment plan shares with expired rescission rights to equity from liabilities at $28.50 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
606
|
|
|
—
|
|
|
—
|
|
|
606
|
|
|
—
|
|
|
—
|
|
|
606
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,105
|
|
|
—
|
|
|
1,105
|
|
|
—
|
|
|
470
|
|
|
1,575
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Balance, December 31, 2010
|
|
3,471
|
|
|
3
|
|
|
2,200
|
|
|
2
|
|
|
93,357
|
|
|
(30,654
|
)
|
|
—
|
|
|
62,708
|
|
|
1,815
|
|
|
21,575
|
|
|
84,283
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Issuance of common shares
(3)
|
|
—
|
|
|
—
|
|
|
5,310
|
|
|
5
|
|
|
59,678
|
|
|
—
|
|
|
—
|
|
|
59,683
|
|
|
—
|
|
|
—
|
|
|
59,683
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Exchange of noncontrolling interest OP units and Class A common shares for Class B common shares
|
|
(868
|
)
|
|
(1
|
)
|
|
1,322
|
|
|
1
|
|
|
4,972
|
|
|
—
|
|
|
—
|
|
|
4,972
|
|
|
(454
|
)
|
|
(4,972
|
)
|
|
—
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Dividend reinvestment plan
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Share-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
114
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Dividends and distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,529
|
)
|
|
—
|
|
|
(11,529
|
)
|
|
—
|
|
|
(1,854
|
)
|
|
(13,383
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Unrealized loss on change in fair value of available-for-sale marketable securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,119
|
)
|
|
(1,119
|
)
|
|
—
|
|
|
(210
|
)
|
|
(1,329
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,123
|
|
|
—
|
|
|
1,123
|
|
|
—
|
|
|
210
|
|
|
1,333
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Balance, December 31, 2011
|
|
2,603
|
|
|
$
|
2
|
|
|
8,835
|
|
|
$
|
8
|
|
|
$
|
158,127
|
|
|
$
|
(41,060
|
)
|
|
$
|
(1,119
|
)
|
|
$
|
115,958
|
|
|
1,361
|
|
|
$
|
14,749
|
|
|
$
|
130,707
|
|
(1)
|
Net of offering costs of
$3.4 million
.
|
(2)
|
During the three months ended June 30, 2010, the Company acquired Class A common shares held by employees who tendered owned Class A common shares to satisfy the tax withholding on the lapse of certain restrictions on restricted shares.
|
(3)
|
Net of offering costs of
$4.0 million
.
|
Whitestone REIT and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) |
||||||||||||
|
|
|
|
|
|
|
||||||
|
|
Year Ended December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
1,333
|
|
|
$
|
1,575
|
|
|
$
|
2,075
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
|
7,749
|
|
|
6,805
|
|
|
6,518
|
|
|||
Amortization of deferred loan costs
|
|
616
|
|
|
420
|
|
|
440
|
|
|||
Gain on sale of marketable securities
|
|
(192
|
)
|
|
—
|
|
|
—
|
|
|||
Loss (gain) on sale or disposal of assets and properties
|
|
(251
|
)
|
|
160
|
|
|
196
|
|
|||
Bad debt expense
|
|
615
|
|
|
536
|
|
|
877
|
|
|||
Share-based compensation
|
|
310
|
|
|
297
|
|
|
1,013
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Escrows and acquisition deposits
|
|
(519
|
)
|
|
3,840
|
|
|
(3,700
|
)
|
|||
Accrued rents and accounts receivable
|
|
(1,939
|
)
|
|
(748
|
)
|
|
(511
|
)
|
|||
Unamortized lease commissions and loan costs
|
|
(995
|
)
|
|
(783
|
)
|
|
(634
|
)
|
|||
Prepaid expenses and other assets
|
|
296
|
|
|
446
|
|
|
527
|
|
|||
Accounts payable and accrued expenses
|
|
993
|
|
|
(2,319
|
)
|
|
2,096
|
|
|||
Tenants' security deposits
|
|
436
|
|
|
166
|
|
|
1
|
|
|||
Net cash provided by operating activities
|
|
8,452
|
|
|
10,395
|
|
|
8,898
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Acquisitions of real estate
|
|
(65,910
|
)
|
|
(8,625
|
)
|
|
(5,619
|
)
|
|||
Additions to real estate
|
|
(7,568
|
)
|
|
(4,143
|
)
|
|
(3,611
|
)
|
|||
Proceeds from sale of property
|
|
1,567
|
|
|
—
|
|
|
—
|
|
|||
Investments in marketable securities
|
|
(13,520
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from sales of marketable securities
|
|
7,252
|
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
|
(78,179
|
)
|
|
(12,768
|
)
|
|
(9,230
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Dividends paid
|
|
(10,045
|
)
|
|
(5,158
|
)
|
|
(4,645
|
)
|
|||
Distributions paid to OP unit holders
|
|
(1,974
|
)
|
|
(2,249
|
)
|
|
(2,281
|
)
|
|||
Proceeds from issuance of common shares, net of offering costs
|
|
59,683
|
|
|
22,970
|
|
|
—
|
|
|||
Proceeds from notes payable
|
|
13,905
|
|
|
1,430
|
|
|
9,557
|
|
|||
Repayments of notes payable
|
|
(3,128
|
)
|
|
(2,957
|
)
|
|
(8,725
|
)
|
|||
Payments of loan origination costs
|
|
(610
|
)
|
|
(98
|
)
|
|
(288
|
)
|
|||
Repurchase of common stock
|
|
—
|
|
|
(249
|
)
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
|
57,831
|
|
|
13,689
|
|
|
(6,382
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
(11,896
|
)
|
|
11,316
|
|
|
(6,714
|
)
|
|||
Cash and cash equivalents at beginning of period
|
|
17,591
|
|
|
6,275
|
|
|
12,989
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
5,695
|
|
|
$
|
17,591
|
|
|
$
|
6,275
|
|
Whitestone REIT and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
Supplemental Disclosures
(in thousands)
|
||||||||||||
|
|
Year Ended December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
5,719
|
|
|
$
|
5,621
|
|
|
$
|
5,535
|
|
Cash paid for taxes
|
|
215
|
|
|
262
|
|
|
223
|
|
|||
Non cash Investing and financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Disposal of fully depreciated real estate
|
|
$
|
238
|
|
|
$
|
598
|
|
|
$
|
564
|
|
Financed insurance premiums
|
|
649
|
|
|
616
|
|
|
568
|
|
|||
Acquisition of real estate in exchange for OP units
|
|
—
|
|
|
—
|
|
|
3,625
|
|
|||
Debt assumed with acquisitions of real estate
|
|
15,425
|
|
|
—
|
|
|
—
|
|
|||
Value of shares issued under dividend reinvestment plan
|
|
37
|
|
|
—
|
|
|
—
|
|
|||
Value of Class B shares exchanged for OP units
|
|
4,972
|
|
|
—
|
|
|
—
|
|
|||
Change in par value of Class A common shares
|
|
—
|
|
|
7
|
|
|
—
|
|
|||
Change in fair value of available-for-sale securities
|
|
(1,329
|
)
|
|
—
|
|
|
—
|
|
|||
Reclassification of dividend reinvestment shares with rescission rights
|
|
—
|
|
|
606
|
|
|
—
|
|
|
|
December 31, 2011
|
||||||||||||||
|
|
Amortized Cost
|
|
Gains in Accumulated Other Comprehensive Income
|
|
Losses in Accumulated Other Comprehensive Income
|
|
Estimated Fair Value
|
||||||||
Real estate sector exchange traded fund
|
|
$
|
301
|
|
|
$
|
—
|
|
|
$
|
(37
|
)
|
|
$
|
264
|
|
Real estate sector mutual funds
|
|
351
|
|
|
—
|
|
|
(55
|
)
|
|
296
|
|
||||
Real estate sector common stock
|
|
5,808
|
|
|
—
|
|
|
(1,237
|
)
|
|
4,571
|
|
||||
Total available-for-sale securities
|
|
$
|
6,460
|
|
|
$
|
—
|
|
|
$
|
(1,329
|
)
|
|
$
|
5,131
|
|
INCOME STATEMENT DATA
|
|
Year Ended December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
Operating revenue
|
|
$
|
41,739
|
|
|
$
|
40,725
|
|
|
$
|
41,994
|
|
Net income
|
|
$
|
4,740
|
|
|
$
|
5,842
|
|
|
$
|
6,254
|
|
|
|
December 31,
|
||||||
|
|
2011
|
|
2010
|
||||
Tenant receivables
|
|
$
|
1,914
|
|
|
$
|
1,742
|
|
Accrued rent
|
|
5,505
|
|
|
4,288
|
|
||
Allowance for doubtful accounts
|
|
(1,366
|
)
|
|
(1,304
|
)
|
||
Totals
|
|
$
|
6,053
|
|
|
$
|
4,726
|
|
|
|
December 31,
|
||||||
|
|
2011
|
|
2010
|
||||
Leasing commissions
|
|
$
|
5,326
|
|
|
$
|
4,971
|
|
Deferred financing costs
|
|
2,916
|
|
|
2,307
|
|
||
Total cost
|
|
8,242
|
|
|
7,278
|
|
||
Less: leasing commissions accumulated amortization
|
|
(2,861
|
)
|
|
(2,669
|
)
|
||
Less: deferred financing cost accumulated amortization
|
|
(1,626
|
)
|
|
(1,011
|
)
|
||
Total cost, net of accumulated amortization
|
|
$
|
3,755
|
|
|
$
|
3,598
|
|
Years Ended December 31,
|
|
Leasing Commissions
|
|
Deferred Financing Costs
|
|
Total
|
||||||
2012
|
|
$
|
702
|
|
|
$
|
716
|
|
|
$
|
1,418
|
|
2013
|
|
536
|
|
|
488
|
|
|
1,024
|
|
|||
2014
|
|
384
|
|
|
55
|
|
|
439
|
|
|||
2015
|
|
266
|
|
|
30
|
|
|
296
|
|
|||
2016
|
|
195
|
|
|
1
|
|
|
196
|
|
|||
Thereafter
|
|
382
|
|
|
—
|
|
|
382
|
|
|||
Total
|
|
$
|
2,465
|
|
|
$
|
1,290
|
|
|
$
|
3,755
|
|
Years Ended December 31,
|
|
Minimum Future Rents
|
||
2012
|
|
$
|
30,651
|
|
2013
|
|
24,376
|
|
|
2014
|
|
18,711
|
|
|
2015
|
|
13,429
|
|
|
2016
|
|
9,464
|
|
|
Thereafter
|
|
30,667
|
|
|
Total
|
|
$
|
127,298
|
|
|
|
December 31,
|
||||||
Description
|
|
2011
|
|
2010
|
||||
Fixed rate notes
|
|
|
|
|
||||
$1.4 million 5.00% Note, Due 2012
|
|
$
|
1,318
|
|
|
$
|
—
|
|
$14.1 million 5.695% Note, due 2013
|
|
14,110
|
|
|
—
|
|
||
$3.0 million 6.00% Note, due 2021
(1)
|
|
2,978
|
|
|
—
|
|
||
$10.0 million 6.04% Note, due 2014
|
|
9,326
|
|
|
9,498
|
|
||
$1.5 million 6.50% Note, due 2014
|
|
1,471
|
|
|
1,496
|
|
||
$11.2 million 6.52% Note, due 2015
|
|
10,763
|
|
|
10,908
|
|
||
$21.4 million 6.53% Notes, due 2013
|
|
19,524
|
|
|
20,142
|
|
||
$24.5 million 6.56% Note, due 2013
|
|
23,597
|
|
|
24,030
|
|
||
$9.9 million 6.63% Notes, due 2014
|
|
9,221
|
|
|
9,498
|
|
||
$0.5 million 3.25% Notes, due 2012
|
|
23
|
|
|
13
|
|
||
Floating rate notes
|
|
|
|
|
||||
Unsecured line of credit LIBOR plus 3.50% to 4.50%, due 2013
|
|
11,000
|
|
|
—
|
|
||
$26.9 million LIBOR plus 2.60% Note, due 2013
|
|
24,559
|
|
|
25,356
|
|
||
|
|
$
|
127,890
|
|
|
$
|
100,941
|
|
(1)
|
The 6.00% interest rate is fixed through March 30, 2016. On March 31, 2016 the interest rate will reset to the rate of interest for a five year balloon note with a thirty year amortization as published by the Federal Home Loan Bank.
|
|
|
Amount Due
|
||
Year
|
|
(in thousands)
|
||
|
|
|
||
2012
|
|
$
|
4,276
|
|
2013
|
|
91,298
|
|
|
2014
|
|
19,191
|
|
|
2015
|
|
10,315
|
|
|
2016
|
|
49
|
|
|
2017 and thereafter
|
|
2,761
|
|
|
Total
|
|
$
|
127,890
|
|
|
|
|
|
Payment due by period (in thousands)
|
||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less than 1
year (2012)
|
|
1 - 3 years
(2013 - 2014)
|
|
3 - 5 years
(2015 - 2016)
|
|
More than
5 years
(after 2016)
|
||||||||||
Long-Term Debt - Principal
|
|
$
|
127,890
|
|
|
$
|
4,276
|
|
|
$
|
110,489
|
|
|
$
|
10,364
|
|
|
$
|
2,761
|
|
Long-Term Debt - Fixed Interest
|
|
13,575
|
|
|
5,784
|
|
|
6,279
|
|
|
837
|
|
|
675
|
|
|||||
Long-Term Debt - Variable Interest
(1)
|
|
1,924
|
|
|
1,104
|
|
|
820
|
|
|
—
|
|
|
—
|
|
|||||
Operating Lease Obligations
|
|
53
|
|
|
29
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
143,442
|
|
|
$
|
11,193
|
|
|
$
|
117,612
|
|
|
$
|
11,201
|
|
|
$
|
3,436
|
|
(1)
|
As of December 31, 2011, we had two loans totaling $35.6 million which bore interest at a floating rate. The variable interest rate payments are based on LIBOR plus 2.60% to LIBOR plus 4.50%. The information in the table above reflects our projected interest rate obligations for the floating rate payments based on one-month LIBOR as of December 31, 2011, of 0.26%.
|
|
|
Year Ended
|
||||||||||
|
|
December 31,
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
(in thousands, except per share data)
|
|
|
|
|
|
|
||||||
Numerator:
|
|
|
|
|
|
|
||||||
Income from continuing operations
|
|
$
|
1,333
|
|
|
$
|
1,575
|
|
|
$
|
2,075
|
|
Less: Net income attributable to noncontrolling interests
|
|
(210
|
)
|
|
(470
|
)
|
|
(733
|
)
|
|||
Dividends paid on unvested restricted shares
|
|
(17
|
)
|
|
(27
|
)
|
|
(27
|
)
|
|||
Undistributed earnings attributable to unvested restricted shares
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
1,106
|
|
|
$
|
1,078
|
|
|
$
|
1,315
|
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
|
||||||
Weighted average number of common shares - basic
|
|
9,028
|
|
|
4,012
|
|
|
3,236
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
|
||||||
Unvested restricted shares
|
|
14
|
|
|
29
|
|
|
66
|
|
|||
Weighted average number of common shares - dilutive
|
|
9,042
|
|
|
4,041
|
|
|
3,302
|
|
|||
|
|
|
|
|
|
|
||||||
Earnings Per Share:
|
|
|
|
|
|
|
||||||
Basic:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.41
|
|
Diluted:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.12
|
|
|
$
|
0.27
|
|
|
$
|
0.40
|
|
|
|
2011
|
|
2010
|
|
2009
|
|||
Ordinary income (unaudited)
|
|
24.4
|
%
|
|
37.8
|
%
|
|
40.5
|
%
|
Return of capital (unaudited)
|
|
66.1
|
%
|
|
62.2
|
%
|
|
59.5
|
%
|
Capital gain distributions (unaudited)
|
|
6.5
|
%
|
|
—
|
%
|
|
—
|
%
|
Unrecaptured section 1250 gain (unaudited)
|
|
3.0
|
%
|
|
—
|
%
|
|
—
|
%
|
Total
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
Class A Common Shareholders
|
|
Class B Common Shareholders
|
|
Noncontrolling OP Unit Holders
|
|
Total
|
||||||||||||||||||||
Quarter Paid
|
|
Distribution Per Common Share
|
|
Total Amount Paid
|
|
Distribution Per Common Share
|
|
Total Amount Paid
|
|
Distribution Per OP Unit
|
|
Total Amount Paid
|
|
Total Amount Paid
|
||||||||||||||
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
807
|
|
|
$
|
0.2850
|
|
|
$
|
2,386
|
|
|
$
|
0.2850
|
|
|
$
|
430
|
|
|
$
|
3,623
|
|
Third Quarter
|
|
0.2850
|
|
|
974
|
|
|
0.2850
|
|
|
2,141
|
|
|
0.2850
|
|
|
514
|
|
|
3,629
|
|
|||||||
Second Quarter
|
|
0.2850
|
|
|
989
|
|
|
0.2850
|
|
|
1,132
|
|
|
0.2850
|
|
|
515
|
|
|
2,636
|
|
|||||||
First Quarter
|
|
0.2850
|
|
|
989
|
|
|
0.2850
|
|
|
627
|
|
|
0.2850
|
|
|
515
|
|
|
2,131
|
|
|||||||
Total
|
|
$
|
1.1400
|
|
|
$
|
3,759
|
|
|
$
|
1.1400
|
|
|
$
|
6,286
|
|
|
$
|
1.1400
|
|
|
$
|
1,974
|
|
|
$
|
12,019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
989
|
|
|
$
|
0.2850
|
|
|
$
|
627
|
|
|
$
|
0.2850
|
|
|
$
|
514
|
|
|
$
|
2,130
|
|
Third Quarter
|
|
0.2850
|
|
|
992
|
|
|
0.0960
|
|
|
211
|
|
|
0.2850
|
|
|
515
|
|
|
1,718
|
|
|||||||
Second Quarter
|
|
0.3375
|
|
|
1,176
|
|
|
—
|
|
|
—
|
|
|
0.3375
|
|
|
610
|
|
|
1,786
|
|
|||||||
First Quarter
|
|
0.3375
|
|
|
1,163
|
|
|
—
|
|
|
—
|
|
|
0.3375
|
|
|
610
|
|
|
1,773
|
|
|||||||
Total
|
|
$
|
1.2450
|
|
|
$
|
4,320
|
|
|
$
|
0.3810
|
|
|
$
|
838
|
|
|
$
|
1.2450
|
|
|
$
|
2,249
|
|
|
$
|
7,407
|
|
|
|
Shares
|
|
Weighted-Average
Grant Date
Fair Value
(1)
|
|||
Non-vested at January 1, 2011
|
|
522,441
|
|
|
$
|
12.48
|
|
Granted
|
|
—
|
|
|
—
|
|
|
Vested
|
|
(5,169
|
)
|
|
15.45
|
|
|
Forfeited
|
|
(13,249
|
)
|
|
11.17
|
|
|
Non-vested at December 31, 2011
|
|
504,023
|
|
|
$
|
12.48
|
|
Available for grant at December 31, 2011
|
|
1,245,638
|
|
|
|
(1)
|
The fair value of the shares granted were determined based on observable market transactions occurring near the date of the grants.
|
|
|
Shares Granted
|
|
Shares Vested
|
||||||||||
Year Ended
|
|
Non-Vested Shares Issued
|
|
Weighted-Average Grant-Date Fair Value
|
|
Vested Shares
|
|
Total Vest-Date Fair Value
|
||||||
|
|
|
|
|
|
|
|
(in thousands)
|
||||||
2011
|
|
—
|
|
|
$
|
—
|
|
|
(5,169
|
)
|
|
$
|
80
|
|
2010
|
|
31,858
|
|
|
14.09
|
|
|
(55,699
|
)
|
|
695
|
|
||
2009
|
|
600,731
|
|
|
12.37
|
|
|
—
|
|
|
—
|
|
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
||||||||
2011
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
8,086
|
|
|
$
|
8,071
|
|
|
$
|
8,790
|
|
|
$
|
9,968
|
|
Net income (loss) attributable to Whitestone REIT
|
|
185
|
|
|
(196
|
)
|
|
578
|
|
|
556
|
|
||||
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic - Net income (loss) attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
$
|
0.03
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
Diluted - Net income (loss) attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
0.03
|
|
|
(0.02
|
)
|
|
0.05
|
|
|
0.05
|
|
||||
2010
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
7,709
|
|
|
$
|
7,832
|
|
|
$
|
7,933
|
|
|
$
|
8,059
|
|
Net income attributable to Whitestone REIT
|
|
217
|
|
|
166
|
|
|
177
|
|
|
545
|
|
||||
Earnings per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic - Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
$
|
0.06
|
|
|
$
|
0.05
|
|
|
$
|
0.04
|
|
|
$
|
0.10
|
|
Diluted - Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
0.06
|
|
|
0.05
|
|
|
0.04
|
|
|
0.10
|
|
(1)
|
The sum of individual quarterly basic and diluted earnings per share amounts may not agree with the year-to-date basic and diluted earning per share amounts as the result of each period's computation being based on the weighted average number of common shares outstanding during that period.
|
|
|
(in thousands)
|
|||||||||||||
|
|
Balance at
|
|
Charged to
|
|
Deductions
|
|
Balance at
|
|||||||
|
|
Beginning
|
|
Costs and
|
|
from
|
|
End of
|
|||||||
Description
|
|
of Year
|
|
Expense
|
|
Reserves
|
|
Year
|
|||||||
Allowance for doubtful accounts:
|
|
|
|
|
|
|
|
|
|||||||
Year ended December 31, 2011
|
|
$
|
1,304
|
|
|
$
|
615
|
|
|
(553
|
)
|
|
$
|
1,366
|
|
Year ended December 31, 2010
|
|
894
|
|
|
536
|
|
|
(126
|
)
|
|
1,304
|
|
|||
Year ended December 31, 2009
|
|
1,497
|
|
|
877
|
|
|
(1,480
|
)
|
|
894
|
|
|
|
|
|
|
|
Costs Capitalized Subsequent
|
|
Gross Amount at which Carried at
|
||||||||||||||||||||
|
|
Initial Cost (in thousands)
|
|
to Acquisition (in thousands)
|
|
End of Period
(in thousands)
(1) (2)
|
||||||||||||||||||||||
|
|
|
|
Building and
|
|
Improvements
|
|
Carrying
|
|
|
|
Building and
|
|
|
||||||||||||||
Property Name
|
|
Land
|
|
Improvements
|
|
(net)
|
|
Costs
|
|
Land
|
|
Improvements
|
|
Total
|
||||||||||||||
Retail Communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Ahwatukee Plaza
|
|
$
|
5,126
|
|
|
$
|
4,086
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
5,126
|
|
|
$
|
4,088
|
|
|
$
|
9,214
|
|
Bellnot Square
|
|
1,154
|
|
|
4,638
|
|
|
422
|
|
|
|
|
1,154
|
|
|
5,060
|
|
|
6,214
|
|
||||||||
Bissonnet Beltway
|
|
415
|
|
|
1,947
|
|
|
454
|
|
|
—
|
|
|
415
|
|
|
2,401
|
|
|
2,816
|
|
|||||||
Centre South
|
|
481
|
|
|
1,596
|
|
|
731
|
|
|
—
|
|
|
481
|
|
|
2,327
|
|
|
2,808
|
|
|||||||
Holly Knight
|
|
320
|
|
|
1,293
|
|
|
190
|
|
|
—
|
|
|
320
|
|
|
1,483
|
|
|
1,803
|
|
|||||||
Kempwood Plaza
|
|
733
|
|
|
1,798
|
|
|
1,087
|
|
|
—
|
|
|
733
|
|
|
2,885
|
|
|
3,618
|
|
|||||||
Lion Square
|
|
1,546
|
|
|
4,289
|
|
|
1,732
|
|
|
—
|
|
|
1,546
|
|
|
6,021
|
|
|
7,567
|
|
|||||||
Pinnacle of Scottsdale
|
|
6,648
|
|
|
22,466
|
|
|
—
|
|
|
—
|
|
|
6,648
|
|
|
22,466
|
|
|
29,114
|
|
|||||||
Providence
|
|
918
|
|
|
3,675
|
|
|
821
|
|
|
—
|
|
|
918
|
|
|
4,496
|
|
|
5,414
|
|
|||||||
Shaver
|
|
184
|
|
|
633
|
|
|
12
|
|
|
—
|
|
|
184
|
|
|
645
|
|
|
829
|
|
|||||||
Shops at Starwood
|
|
4,093
|
|
|
11,487
|
|
|
—
|
|
|
—
|
|
|
4,093
|
|
|
11,487
|
|
|
15,580
|
|
|||||||
South Richey
|
|
778
|
|
|
2,584
|
|
|
450
|
|
|
—
|
|
|
778
|
|
|
3,034
|
|
|
3,812
|
|
|||||||
Spoerlein Commons
|
|
2,340
|
|
|
7,296
|
|
|
238
|
|
|
—
|
|
|
2,340
|
|
|
7,534
|
|
|
9,874
|
|
|||||||
SugarPark Plaza
|
|
1,781
|
|
|
7,125
|
|
|
352
|
|
|
—
|
|
|
1,781
|
|
|
7,477
|
|
|
9,258
|
|
|||||||
Sunridge
|
|
276
|
|
|
1,186
|
|
|
268
|
|
|
—
|
|
|
276
|
|
|
1,454
|
|
|
1,730
|
|
|||||||
Terravita Marketplace
|
|
7,171
|
|
|
9,392
|
|
|
57
|
|
|
—
|
|
|
7,171
|
|
|
9,449
|
|
|
16,620
|
|
|||||||
Torrey Square
|
|
1,981
|
|
|
2,971
|
|
|
912
|
|
|
—
|
|
|
1,981
|
|
|
3,883
|
|
|
5,864
|
|
|||||||
Town Park
|
|
850
|
|
|
2,911
|
|
|
266
|
|
|
—
|
|
|
850
|
|
|
3,177
|
|
|
4,027
|
|
|||||||
Webster Point
|
|
720
|
|
|
1,150
|
|
|
337
|
|
|
—
|
|
|
720
|
|
|
1,487
|
|
|
2,207
|
|
|||||||
Westchase
|
|
423
|
|
|
1,751
|
|
|
2,787
|
|
|
—
|
|
|
423
|
|
|
4,538
|
|
|
4,961
|
|
|||||||
Windsor Park
|
|
2,621
|
|
|
10,482
|
|
|
2,800
|
|
|
—
|
|
|
2,621
|
|
|
13,282
|
|
|
15,903
|
|
|||||||
|
|
$
|
40,559
|
|
|
$
|
104,756
|
|
|
$
|
13,918
|
|
|
$
|
—
|
|
|
$
|
40,559
|
|
|
$
|
118,674
|
|
|
$
|
159,233
|
|
Office/Flex Communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Brookhill
|
|
$
|
186
|
|
|
$
|
788
|
|
|
$
|
289
|
|
|
$
|
—
|
|
|
$
|
186
|
|
|
$
|
1,077
|
|
|
$
|
1,263
|
|
Corporate Park Northwest
|
|
1,534
|
|
|
6,306
|
|
|
1,093
|
|
|
—
|
|
|
1,534
|
|
|
7,399
|
|
|
8,933
|
|
|||||||
Corporate Park West
|
|
2,555
|
|
|
10,267
|
|
|
937
|
|
|
—
|
|
|
2,555
|
|
|
11,204
|
|
|
13,759
|
|
|||||||
Corporate Park Woodland
|
|
652
|
|
|
5,330
|
|
|
622
|
|
|
—
|
|
|
652
|
|
|
5,952
|
|
|
6,604
|
|
|||||||
Dairy Ashford
|
|
226
|
|
|
1,211
|
|
|
98
|
|
|
—
|
|
|
226
|
|
|
1,309
|
|
|
1,535
|
|
|||||||
Holly Hall
|
|
608
|
|
|
2,516
|
|
|
355
|
|
|
—
|
|
|
608
|
|
|
2,871
|
|
|
3,479
|
|
|||||||
Interstate 10
|
|
208
|
|
|
3,700
|
|
|
453
|
|
|
—
|
|
|
208
|
|
|
4,153
|
|
|
4,361
|
|
|||||||
Main Park
|
|
1,328
|
|
|
2,721
|
|
|
548
|
|
|
—
|
|
|
1,328
|
|
|
3,269
|
|
|
4,597
|
|
|||||||
Plaza Park
|
|
902
|
|
|
3,294
|
|
|
1,071
|
|
|
—
|
|
|
902
|
|
|
4,365
|
|
|
5,267
|
|
|||||||
West Belt Plaza
|
|
568
|
|
|
2,165
|
|
|
648
|
|
|
—
|
|
|
568
|
|
|
2,813
|
|
|
3,381
|
|
|||||||
Westgate
|
|
672
|
|
|
2,776
|
|
|
445
|
|
|
—
|
|
|
672
|
|
|
3,221
|
|
|
3,893
|
|
|||||||
|
|
$
|
9,439
|
|
|
$
|
41,074
|
|
|
$
|
6,559
|
|
|
$
|
—
|
|
|
$
|
9,439
|
|
|
$
|
47,633
|
|
|
$
|
57,072
|
|
|
|
|
|
|
|
Costs Capitalized Subsequent
|
|
Gross Amount at which Carried at
|
||||||||||||||||||||
|
|
Initial Cost (in thousands)
|
|
to Acquisition (in thousands)
|
|
End of Period
(in thousands)
(1) (2)
|
||||||||||||||||||||||
|
|
|
|
Building and
|
|
Improvements
|
|
Carrying
|
|
|
|
Building and
|
|
|
||||||||||||||
Property Name
|
|
Land
|
|
Improvements
|
|
(net)
|
|
Costs
|
|
Land
|
|
Improvements
|
|
Total
|
||||||||||||||
Office Communities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
9101 LBJ Freeway
|
|
$
|
1,597
|
|
|
$
|
6,078
|
|
|
$
|
1,302
|
|
|
$
|
—
|
|
|
$
|
1,597
|
|
|
$
|
7,380
|
|
|
$
|
8,977
|
|
Featherwood
|
|
368
|
|
|
2,591
|
|
|
482
|
|
|
—
|
|
|
368
|
|
|
3,073
|
|
|
3,441
|
|
|||||||
Pima Norte
|
|
1,086
|
|
|
7,162
|
|
|
1,194
|
|
|
517
|
|
|
1,086
|
|
|
8,873
|
|
|
9,959
|
|
|||||||
Royal Crest
|
|
509
|
|
|
1,355
|
|
|
189
|
|
|
—
|
|
|
509
|
|
|
1,544
|
|
|
2,053
|
|
|||||||
Uptown Tower
|
|
1,621
|
|
|
15,551
|
|
|
3,073
|
|
|
—
|
|
|
1,621
|
|
|
18,624
|
|
|
20,245
|
|
|||||||
Woodlake Plaza
|
|
1,107
|
|
|
4,426
|
|
|
1,058
|
|
|
—
|
|
|
1,107
|
|
|
5,484
|
|
|
6,591
|
|
|||||||
Zeta Building
|
|
636
|
|
|
1,819
|
|
|
318
|
|
|
—
|
|
|
636
|
|
|
2,137
|
|
|
2,773
|
|
|||||||
|
|
$
|
6,924
|
|
|
$
|
38,982
|
|
|
$
|
7,616
|
|
|
$
|
517
|
|
|
$
|
6,924
|
|
|
$
|
47,115
|
|
|
$
|
54,039
|
|
Total Operating Portfolio
|
|
$
|
56,922
|
|
|
$
|
184,812
|
|
|
$
|
28,093
|
|
|
$
|
517
|
|
|
$
|
56,922
|
|
|
$
|
213,422
|
|
|
$
|
270,344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
The Citadel
|
|
$
|
472
|
|
|
$
|
1,777
|
|
|
$
|
967
|
|
|
$
|
—
|
|
|
$
|
472
|
|
|
$
|
2,744
|
|
|
$
|
3,216
|
|
Desert Canyon
|
|
1,976
|
|
|
1,704
|
|
|
134
|
|
|
—
|
|
|
1,976
|
|
|
1,838
|
|
|
3,814
|
|
|||||||
Gilbert Tuscany Village
|
|
1,767
|
|
|
3,233
|
|
|
10
|
|
|
—
|
|
|
1,767
|
|
|
3,243
|
|
|
5,010
|
|
|||||||
The Marketplace at Central
|
|
1,305
|
|
|
5,324
|
|
|
529
|
|
|
—
|
|
|
1,305
|
|
|
5,853
|
|
|
7,158
|
|
|||||||
Total - Development Portfolio
|
|
$
|
5,520
|
|
|
$
|
12,038
|
|
|
$
|
1,640
|
|
|
$
|
—
|
|
|
$
|
5,520
|
|
|
$
|
13,678
|
|
|
$
|
19,198
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Pinnacle Phase II
|
|
$
|
1,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,000
|
|
|
$
|
—
|
|
|
$
|
1,000
|
|
Shops at Starwood Phase III
|
|
1,818
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,818
|
|
|
—
|
|
|
1,818
|
|
|||||||
Total - Property Held for Development
|
|
$
|
2,818
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,818
|
|
|
$
|
—
|
|
|
$
|
2,818
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Grand Totals
|
|
$
|
65,260
|
|
|
$
|
196,850
|
|
|
$
|
29,733
|
|
|
$
|
517
|
|
|
$
|
65,260
|
|
|
$
|
227,100
|
|
|
$
|
292,360
|
|
|
|
|
|
Accumulated Depreciation
|
|
Date of
|
|
Date
|
|
Depreciation
|
||
Property Name
|
|
Encumbrances
|
|
(in thousands)
|
|
Construction
|
|
Acquired
|
|
Life
|
||
Retail Communities:
|
|
|
|
|
|
|
|
|
|
|
||
Ahwatukee
|
|
|
|
$
|
35
|
|
|
|
|
8/16/2011
|
|
5-39 years
|
Bellnot Square
|
|
|
|
1,321
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
Bissonnet Beltway
|
|
|
|
1,159
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
Centre South
|
|
|
|
861
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
Holly Knight
|
|
(3)
|
|
732
|
|
|
|
|
8/1/2000
|
|
5-39 years
|
|
Kempwood Plaza
|
|
(3)
|
|
1,315
|
|
|
|
|
2/2/1999
|
|
5-39 years
|
|
Lion Square
|
|
(3)
|
|
1,835
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
Pinnacle of Scottsdale
|
|
(9)
|
|
16
|
|
|
|
|
12/22/2011
|
|
5-39 years
|
|
Providence
|
|
(3)
|
|
1,440
|
|
|
|
|
3/30/2001
|
|
5-39 years
|
|
Shaver
|
|
|
|
269
|
|
|
|
|
12/17/1999
|
|
5-39 years
|
|
Shops at Starwood
|
|
|
|
3
|
|
|
|
|
12/28/2011
|
|
5-39 years
|
|
South Richey
|
|
(3)
|
|
972
|
|
|
|
|
8/25/1999
|
|
5-39 years
|
|
Spoerlein Commons
|
|
|
|
587
|
|
|
|
|
1/16/2009
|
|
5-39 years
|
|
SugarPark Plaza
|
|
(3)
|
|
1,383
|
|
|
|
|
9/8/2004
|
|
5-39 years
|
|
Sunridge
|
|
(3)
|
|
458
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
Terravita Marketplace
|
|
|
|
80
|
|
|
|
|
8/8/2011
|
|
5-39 years
|
|
Torrey Square
|
|
(3)
|
|
1,559
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
Town Park
|
|
(3)
|
|
1,408
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
Webster Point
|
|
|
|
607
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
Westchase
|
|
|
|
906
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
Windsor Park
|
|
(4)
|
|
2,319
|
|
|
|
|
12/16/2003
|
|
5-39 years
|
|
|
|
|
|
$
|
19,265
|
|
|
|
|
|
|
|
Office/Flex Communities:
|
|
|
|
|
|
|
|
|
|
|
||
Brookhill
|
|
(5)
|
|
$
|
280
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
Corporate Park Northwest
|
|
|
|
2,232
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
Corporate Park West
|
|
(6)
|
|
3,194
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
Corporate Park Woodland
|
|
(7)
|
|
2,253
|
|
|
11/1/2000
|
|
|
|
5-39 years
|
|
Dairy Ashford
|
|
|
|
513
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
Holly Hall
|
|
(7)
|
|
736
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
Interstate 10
|
|
(7)
|
|
2,020
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
Main Park
|
|
(7)
|
|
1,232
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
Plaza Park
|
|
(7)
|
|
1,611
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
West Belt Plaza
|
|
(7)
|
|
1,271
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
Westgate
|
|
(7)
|
|
922
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
|
|
|
|
$
|
16,264
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Depreciation
|
|
Date of
|
|
Date
|
|
Depreciation
|
||
Property Name
|
|
Encumbrances
|
|
(in thousands)
|
|
Construction
|
|
Acquired
|
|
Life
|
||
Office Communities:
|
|
|
|
|
|
|
|
|
|
|
||
9101 LBJ Freeway
|
|
(8)
|
|
$
|
1,579
|
|
|
|
|
8/10/2005
|
|
5-39 years
|
Featherwood
|
|
|
|
1,143
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
Pima Norte
|
|
|
|
751
|
|
|
|
|
10/4/2007
|
|
5-39 years
|
|
Royal Crest
|
|
|
|
539
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
Uptown Tower
|
|
(8)
|
|
3,544
|
|
|
|
|
11/22/2005
|
|
5-39 years
|
|
Woodlake Plaza
|
|
(8)
|
|
1,308
|
|
|
|
|
3/14/2005
|
|
5-39 years
|
|
Zeta Building
|
|
(5)
|
|
789
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
|
|
|
|
$
|
9,653
|
|
|
|
|
|
|
|
Total Operating Portflio
|
|
|
|
$
|
45,182
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
The Citadel
|
|
|
|
$
|
61
|
|
|
|
|
9/28/2010
|
|
5-39 years
|
Desert Canyon
|
|
|
|
29
|
|
|
|
|
4/13/2011
|
|
5-39 years
|
|
Gilbert Tuscany Village
|
|
|
|
41
|
|
|
|
|
6/28/2011
|
|
5-39 years
|
|
The Marketplace at Central
|
|
|
|
159
|
|
|
|
|
11/1/2010
|
|
5-39 years
|
|
Total - Development Portfolio
|
|
|
|
$
|
290
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Pinnacle Phase II
|
|
|
|
$
|
—
|
|
|
|
|
12/28/2011
|
|
Land - Not Depreciated
|
Shops at Starwood Phase III
|
|
(10)
|
|
—
|
|
|
|
|
12/28/2011
|
|
Land - Not Depreciated
|
|
Total - Property Held For Development
|
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Grand Total
|
|
|
|
$
|
45,472
|
|
|
|
|
|
|
|
(1)
|
Reconciliations of total real estate carrying value for the three years ended December 31, follows:
|
|
|
( in thousands)
|
||||||||||
|
|
2011
|
|
2010
|
|
2009
|
||||||
Balance at beginning of period
|
|
$
|
204,954
|
|
|
$
|
192,832
|
|
|
$
|
180,397
|
|
Additions during the period:
|
|
|
|
|
|
|
|
|
|
|||
Acquisitions
|
|
82,030
|
|
|
8,878
|
|
|
9,636
|
|
|||
Improvements
|
|
7,568
|
|
|
4,142
|
|
|
3,770
|
|
|||
|
|
89,598
|
|
|
13,020
|
|
|
13,406
|
|
|||
Deductions - cost of real estate sold or retired
|
|
(2,192
|
)
|
|
(898
|
)
|
|
(971
|
)
|
|||
Balance at close of period
|
|
$
|
292,360
|
|
|
$
|
204,954
|
|
|
$
|
192,832
|
|
(2)
|
The aggregate cost of real estate (in thousands) for federal income tax purposes is $265,509.
|
(3)
|
These properties secure a $21.4 million and a $9.9 million mortgage notes.
|
(4)
|
This property secures a $10.0 million mortgage note.
|
(5)
|
These properties secure a $1.5 million mortgage note.
|
(6)
|
This property secures an $11.2 million mortgage note.
|
(7)
|
These properties secure a $26.9 million mortgage note.
|
(8)
|
These properties secure a $24.5 million mortgage note.
|
(9)
|
This property secures a $14.1 million mortgage note.
|
(10)
|
This property secures a $1.4 million mortgage note.
|
Exhibit No.
|
Description
|
3.1.1
|
Articles of Amendment and Restatement of Whitestone REIT (previously filed as and incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed on July 31, 2008)
|
3.1.2
|
Articles Supplementary (previously filed as and incorporated by reference to Exhibit 3(i).1 to the Registrant’s Current Report on Form 8-K, filed December 6, 2006)
|
3.1.3
|
Articles of Amendment (previously filed and incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed on August 24, 2010)
|
3.1.4
|
Articles of Amendment (previously filed and incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K, filed on August 24, 2010)
|
3.1.5
|
Articles Supplementary (previously filed and incorporated by reference to Exhibit 3.3 to the Registrant’s Current Report on Form 8-K, filed on August 24, 2010)
|
3.2
|
Amended and Restated Bylaws of Whitestone REIT (previously filed as and incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed October 9, 2008)
|
10.1
|
Agreement of Limited Partnership of Whitestone REIT Operating Partnership, L.P. (previously filed as and incorporated by reference to Exhibit 10.1 to the Registrant’s General Form for Registration of Securities on Form 10, filed on April 30, 2003)
|
10.2
|
Certificate of Formation of Whitestone REIT Operating Partnership II GP, LLC (previously filed as and incorporated by reference to Exhibit 10.3 to the Registrant’s General Form for Registration of Securities on Form 10, filed on April 30, 2003)
|
10.3
|
Limited Liability Company Agreement of Whitestone REIT Operating Partnership II GP, LLC (previously filed as and incorporated by reference to Exhibit 10.4 to the Registrant’s General Form for Registration of Securities on Form 10, filed on April 30, 2003)
|
10.4
|
Agreement of Limited Partnership of Whitestone REIT Operating Partnership II, L.P. (previously filed as and incorporated by reference to Exhibit 10.6 to the Registrant’s General Form for Registration of Securities on Form 10, filed on April 30, 2003)
|
10.5
|
Amendment to the Agreement of Limited Partnership of Whitestone REIT Operating Partnership, L.P. (previously filed in and incorporated by reference to Exhibit 10.1 to the Registrant’s Registration Statement on Form S-11, Commission File No. 333-111674, filed on December 31, 2003)
|
10.6
|
Promissory Note between HCP REIT Operating Company IV LLC and MidFirst Bank, dated March 1, 2007 (previously filed and incorporated by reference to Exhibit 10.25 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2006, filed on March 30, 2007)
|
10.7
|
Term Loan Agreement among Whitestone REIT Operating Partnership, L.P., Whitestone Pima Norte LLC, Whitestone REIT Operating Partnership III LP, Hartman REIT Operating Partnership III LP LTD, Whitestone REIT Operating Partnership III GP LLC and KeyBank National Association, dated January 25, 2008 (previously filed as and incorporated by reference to Exhibit 10.29 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007, filed on March 31, 2008)
|
10.8+
|
Whitestone REIT 2008 Long-Term Equity Incentive Ownership Plan (previously filed and incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed July 31, 2008)
|
10.9
|
Promissory Note among Whitestone Corporate Park West, LLC and MidFirst Bank dated August 5, 2008 (previously filed and incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K, filed August 8, 2008)
|
Exhibit No.
|
Description
|
10.10
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated October 1, 2008 (previously filed and incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K, filed October 7, 2008)
|
10.11
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated October 1, 2008 (previously filed and incorporated by reference to Exhibit 99.2 to the Registrant’s Current Report on Form 8-K, filed October 7, 2008)
|
10.12
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated October 1, 2008 (previously filed and incorporated by reference to Exhibit 99.3 to the Registrant’s Current Report on Form 8-K, filed October 7, 2008)
|
10.13
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated October 1, 2008 (previously filed and incorporated by reference to Exhibit 99.4 to the Registrant’s Current Report on Form 8-K, filed October 7, 2008)
|
10.14
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated October 1, 2008 (previously filed and incorporated by reference to Exhibit 99.5 to the Registrant’s Current Report on Form 8-K, filed October 7, 2008)
|
10.15
|
Promissory Note among Whitestone Offices LLC and Nationwide Life Insurance Company dated October 1, 2008 (previously filed and incorporated by reference to Exhibit 99.6 to the Registrant’s Current Report on Form 8-K, filed October 7, 2008)
|
10.16
|
Floating Rate Promissory Note among Whitestone Industrial-Office LLC and Jackson Life National Insurance Company dated October 3, 2008 (previously filed and incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed October 9, 2008)
|
10.17+
|
Form of Restricted Common Share Award Agreement (Performance Vested) (previously filed and incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed January 7, 2009)
|
10.18+
|
Form of Restricted Common Share Award Agreement (Time Vested) (previously filed and incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed January 7, 2009)
|
10.19+
|
Form of Restricted Unit Award Agreement (previously filed and incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, filed January 7, 2009)
|
10.20
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated February 3, 2009 (previously filed and incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed February 10, 2009)
|
10.21
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated February 3, 2009 (previously filed and incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed February 10, 2009)
|
10.22
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated February 3, 2009 (previously filed and incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, filed February 10, 2009)
|
10.23
|
Promissory Note among Whitestone Centers LLC and Sun Life Assurance Company of Canada dated February 3, 2009 (previously filed and incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K, filed February 10, 2009)
|
Exhibit No.
|
Description
|
10.24
|
Purchase, Sale and Contribution Agreement between Whitestone REIT Operating Partnership, L.P. and Bank One, Chicago, NA, as trustee for Midwest Development Venture IV dated December 18, 2008 (previously filed and incorporated by reference to Exhibit 10.8 to Registrant’s Quarterly Report on Form 10-Q, filed on May 15, 2009)
|
10.25+
|
Trustee Restricted Common Share Grant Agreement (Time Vested) between Whitestone REIT and Daryl J. Carter (previously filed and incorporated by reference to Exhibit 10.9 to Registrant’s Quarterly Report on Form 10-Q, filed on May 15, 2009)
|
10.26+
|
Trustee Restricted Common Share Grant Agreement (Time Vested) between Whitestone REIT and Daniel G. DeVos (previously filed and incorporated by reference to Exhibit 10.10 to Registrant’s Quarterly Report on Form 10-Q, filed on May 15, 2009)
|
10.27+
|
Trustee Restricted Common Share Grant Agreement (Time Vested) between Whitestone REIT and Donald F. Keating (previously filed and incorporated by reference to Exhibit 10.11 to Registrant’s Quarterly Report on Form 10-Q, filed on May 15, 2009)
|
10.28+
|
Trustee Restricted Common Share Grant Agreement (Time Vested) between Whitestone REIT and Jack L.Mahaffey (previously filed and incorporated by reference to Exhibit 10.12 toRegistrant’s Quarterly Report on Form 10-Q, filed on May 15, 2009)
|
10.29+
|
Grant Agreement for Restricted Shares between Whitestone REIT and Chris A.Minton (previously filed and incorporated by reference to Exhibit 10.13 to Registrant’s Quarterly Report on Form 10-Q, filed on May 15, 2009)
|
10.30
|
Promissory Note dated September 10, 2010 between Whitestone REIT Operating Company IV LLC and MidFirst Bank (previously filed and incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K, filed September 16, 2010)
|
10.31
|
Modification of Promissory Note dated September 10, 2010 between Whitestone REIT Operating Company IV LLC and MidFirst Bank (previously filed and incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K, filed September 16, 2010)
|
10.32
|
Limited Guarantee dated September 10, 2010 between Whitestone REIT Operating Company IV LLC and MidFirst Bank (previously filed and incorporated by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K, filed September 16, 2010)
|
10.33
|
Promissory Note among Whitestone Featherwood LLC and Viewpoint Bank dated March 31, 2011 (previously filed and incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K, filed April 5, 2011)
|
10.34
|
Credit Agreement among Whitestone Operating Partnership, L.P. and Bank of Montreal dated June 13, 2011 (previously filed and incorporated by reference to Exhibit 99.1 to the Registrant's Current Report on Form 8-K, filed June 17, 2011)
|
10.35*
|
Assumption Agreement among U.S. National Bank Association, Scottsdale Pinnacle LP, Howard Bankchik and Steven J. Fogel, Whitestone Pinnacle of Scottsdale of Scottsdale, LLC and Whitestone REIT Operating Partnership, LP and Whitestone REIT, dated December 22, 2011*
|
10.36+
|
First Amendment to the Whitestone REIT 2008 Long-Term Equity Incentive Ownership Plan
|
21.1*
|
List of subsidiaries of Whitestone REIT
|
23.1*
|
Consent of Pannell Kerr Forster of Texas, P.C.
|
Exhibit No.
|
Description
|
24.1
|
Power of Attorney (included on the signature page hereto)
|
31.1*
|
Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
31.2*
|
Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
32.1*
|
Certificate of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2*
|
Certificate of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.INS***
|
XBRL Instance Document
|
|
|
101. SCH***
|
XBRL Taxonomy Extension Schema Document
|
|
|
101.CAL***
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
101.LAB***
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
101.PRE***
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
101.DEF***
|
XBRL Taxonomy Extension Definition Linkbase Document
|
A.
|
Noteholder's predecessor in interest, Bear Stearns Commercial Mortgage, Inc., a New York corporation (“
Original Lender
”), made a loan to Borrower in the original principal amount of Fifteen Million Seven Hundred Thousand and no/100 Dollars ($15,700,000.00) (“
Loan
”), under the terms and provisions set forth in the following loan documents, all of which are dated as of May 15, 2003, unless otherwise noted:+
|
1.
|
Promissory Note (“
Note
”) in the original principal amount of the Loan, made by Borrower and payable to Original Lender, as amended by an Amendment to Promissory Note;
|
2.
|
Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing executed by Borrower to Stewart Title & Trust of Phoenix, Inc., as trustee, for the benefit of Original Lender which secures the Note and other obligations of Borrower (“
Security Instrument
”), and which Security Instrument was recorded on May 15, 2003, as Document No. 2003-0624539 with the Maricopa County Recorder, State of Arizona (“
Official Records
”), the Original Lender's interest under which was assigned to Noteholder by instrument recorded on January 9, 2004, as Document No. 2004-0025300, in the Official Records. The Security Instrument was subsequently modified by that certain Partial Release of Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing and Partial Release of Assignment of Leases and Rents dated as of May 23, 2008 and recorded in the Official Records as Document No. 20080658279 on July 29, 2008 (“
Partial Release Documents
”). The land, improvements and other real property which are currently subject to the Security Instrument, as modified by the Partial Release Documents, are hereinafter referred to as the “
Property
” and the equipment, machinery and other personal property which are subject to the Security instrument as modified by the Partial Release Documents are hereinafter referred to as the “
Collateral
”;
|
3.
|
Assignment of Leases and Rents executed by Borrower, which was recorded on May 15, 2003, as Document No. 2003-0624540, with the Official Records, the Original Lender's interest under which was assigned to Noteholder by instrument recorded on January 9, 2004,
|
4.
|
Indemnity Agreement executed by Original Guarantor (“
Guaranty
”);
|
5.
|
Conditional Assignment of Management Agreement, executed by Borrower and Westwood Financial Corp.;
|
6.
|
Replacement Reserve, Leasing Reserve and Security Agreement executed by Borrower (“
Reserve and Security Agreement
”);
|
7.
|
Cash Management Agreement executed by Borrower, LaSalle Bank National Association and Original Lender (“
Cash Management Agreement
”);
|
8.
|
Assignment of Agreements, Permits and Contracts executed by Borrower and Original Lender;
|
9.
|
UCC-1 Financing Statement recorded on May 15, 2003, as Document No. 2003-0624541 with the Official Records, as amended on by UCC Financing Statement Amendment recorded July 29, 2008 as Document No. 20080658280 with the Official Records; and
|
10.
|
UCC-1 Financing Statement filed on July 3, 2003, as Instrument 0319160012, with the California Secretary of State (“
State UCC
”).
|
B.
|
As of December 14, 2011:
|
1.
|
Accrued interest on the Note has been paid through November 30, 2011;
|
2.
|
The balance in the Escrow Fund for the payment of Taxes (as such terms are defined in Sections 3.4 and 3.5 of the Security Instrument) was $168,530.45;
|
3.
|
The balance in the Escrow Fund for the payment of Insurance Premiums (as such terms are defined in Sections 3.3 and 3.5 of the Security Instrument) was $29,956.42; and,
|
4.
|
The balance in the Leasing Reserve (as defined in the Reserve and Security Agreement) was $40,421.79, and deposits to the Leasing Reserve are currently suspended pursuant to the terms of the Reserve and Security Agreement; and
|
5.
|
The balance in the Replacement Reserve (as defined in the Reserve and Security Agreement) was $142,107.04.
|
C.
|
Borrower has sold and conveyed the Property and the Collateral to Assumptor, or is about to sell and convey the Property and the Collateral to Assumptor, and both parties desire to obtain from Noteholder a waiver of any right Noteholder may have under the Loan Documents to accelerate the Maturity Date of the Note by virtue of such conveyance.
|
D.
|
Subject to the terms and conditions hereof, Noteholder is willing to consent to the sale and conveyance of the Property and the Collateral, and to waive any right of acceleration of the Maturity Date of the Note upon assumption by Assumptor of all obligations of Borrower under the Loan Documents.
|
1.
|
Incorporation
. The foregoing recitals are incorporated herein by this reference.
|
2.
|
Assumption Fee
. As consideration for Noteholder's execution of this Assumption Agreement and in addition to any other sums due hereunder, Assumptor agrees to pay Noteholder or Noteholder's servicer(s) (all as set forth in the escrow instructions to be executed in connection with the closing of this assumption) an assumption fee of $141,317.56 (representing 1% of the outstanding principal balance of the Loan as of the date of this Assumption Agreement).
|
3.
|
Conditions Precedent
. The following are conditions precedent to Noteholder's obligations under this Assumption Agreement:
|
a.
|
The irrevocable commitment of First American Title Insurance Company (“
Title Company
”) to issue a new policy identical to that certain policy issued by Stewart Title & Trust of Phoenix (“
Existing Title Policy
”), in form and substance acceptable to Noteholder and without deletions or exceptions other than as expressly approved by Noteholder in writing, insuring Noteholder that the priority and validity of the Security Instrument has not been and will not be impaired by this Assumption Agreement, the conveyance of the Property, or the transaction contemplated hereby;
|
b.
|
Receipt and approval by Noteholder of: (i) the executed original of this Assumption Agreement; (ii) an executed original of a Memorandum of Assumption Agreement in the form attached hereto as
EXHIBIT A
and otherwise in form and substance acceptable to Noteholder (“
Memorandum of Assumption Agreement
”); and (iii) any other documents and agreements which are required pursuant to this Assumption Agreement, in form and content acceptable to Noteholder;
|
c.
|
Recordation in the Official Records of the Memorandum of Assumption Agreement, together with such other documents and agreements, if any, required pursuant to this Assumption Agreement or which Noteholder has requested to be recorded or filed;
|
d.
|
Delivery to Noteholder of UCC Financing Statements in proper form for filing in the appropriate jurisdictions as determined by Noteholder, which Assumptor expressly authorizes Noteholder to file;
|
e.
|
Execution and delivery to Noteholder by New Guarantor of a Indemnity Agreement (“
New Guaranty
”) in favor of Noteholder and in form and substance acceptable to Noteholder, pursuant to which New Guarantor irrevocably guarantees payment for certain matters under the Note as more specifically set forth in the New Guaranty;
|
f.
|
Delivery to Noteholder of the organizational documents and evidence of good standing of Assumptor, its constituent parties, and of New Guarantor, together with such resolutions or certificates as Noteholder may require, in form and content acceptable to Noteholder, authorizing the assumption of the Loan and executed by the appropriate persons and/or entities on behalf of Assumptor and New Guarantor;
|
g.
|
The representations and warranties contained herein are true and correct;
|
h.
|
Receipt by Noteholder of evidence of insurance acceptable in all respects to Noteholder, including certificates of insurance evidencing Assumptor's casualty insurance policy (ACORD 27) and comprehensive liability insurance policy (ACORD 25) with respect to the Property, each in form and amount satisfactory to Noteholder, with the annual premium for same to be paid at closing;
|
i.
|
Receipt by Noteholder of a copy of the special warranty deed by which title to the Property will be conveyed to Assumptor, and the purchase and sale agreement documenting the sale of the Property to Assumptor;
|
j.
|
Receipt by Noteholder of an executed assignment of the purchaser's interest in the purchase and sale agreement for the Property from the purchaser named therein to Assumptor;
|
k.
|
Receipt by Noteholder of an executed Form W-9 for Assumptor;
|
l.
|
Receipt by Noteholder of a copy of the new property management agreement for the Property in form and substance, and with a manager, acceptable to Noteholder, along with an executed assignment of management agreement acceptable to Noteholder;
|
m.
|
Noteholder shall have received such opinions of special counsel to Noteholder as may be required by Noteholder's counsel or the Loan Documents (a) opining to the validity and enforceability of this Assumption Agreement and the terms and provisions hereof,
|
n.
|
Noteholder shall have received opinions of counsel to Assumptor and New Guarantor opining with respect to (i) the validity and enforceability of this Assumption Agreement and the terms and provisions hereof, and any other agreement executed in connection with the transactions contemplated hereby, (ii) the authority of the Assumptor and New Guarantor (and any constituents thereof), to execute and deliver this Assumption Agreement and perform their obligations under the Note and other Loan Documents, and (iii) such other matters as reasonably requested by the Noteholder;
|
o.
|
Payment of the assumption fee provided for in Section 2 above;
|
p.
|
Assumptor's reimbursement to Noteholder of Noteholder's costs and expenses incurred in connection with this Assumption Agreement and the transactions contemplated hereby, including, without limitation, title insurance costs, escrow and recording fees, attorneys' fees, appraisal, engineers' and inspection fees and documentation costs and charges, whether such services are furnished by Noteholder's employees, agents or independent contractors;
|
q.
|
Assumptor's execution of the Deposit Account Control Agreement;
|
r.
|
Borrower's delivery to Noteholder of evidence sufficient to establish that the second mortgage on the property has been reconveyed by the lender, TPAS Financing LLC; and,
|
s.
|
Borrower's delivery to Noteholder of evidence that payment has been made to: (i) Body Solutions (The Beauty Scene) for tenant improvements in the amount of $4,500.00; and (ii) to leasing broker in the amount of $6,327.75.
|
4.
|
Effective Date
. The effective date of this Assumption Agreement shall be the date the Memorandum of Assumption Agreement is first written above (“
Effective Date
”).
|
5.
|
Assumption
. Assumptor hereby assumes and agrees to pay when due all sums due or to become due or owing under the Note, the Security Instrument and the other Loan Documents first arising from and after the Effective Date and shall hereafter faithfully perform all of Borrower's obligations under and be bound by all of the provisions of the Loan Documents and assumes all liabilities of Borrower under the Loan Documents as if Assumptor were an original signatory thereto. The execution of this Assumption Agreement by Assumptor shall be deemed its execution of the Note, the Security Instrument and the other Loan Documents.
|
6.
|
Partial Release of Borrower; Release of Noteholder
. Noteholder hereby releases (on the Effective Date) Borrower from liability under the Loan Documents other than this Assumption Agreement; provided however, that the parties hereby acknowledge and agree that Borrower is expressly not released from and nothing contained herein is intended to limit, impair, terminate or revoke, any of Borrower's obligations with respect to the matters set forth in Article 14 of the Note, to the extent the same arise out of or in connection with any act or omission occurring on or before the Effective Date (the “
Retained Obligations
”), and that such obligations shall continue in full force and effect in accordance with the terms and provisions thereof and hereof. Borrower's obligations under the Loan Documents with respect to the Retained Obligations shall not be discharged or reduced by any extension, amendment,
|
7.
|
Confirmation of Guaranty; Partial Release of Original Guarantor
. Nothing contained herein is intended to limit, impair, terminate or revoke Original Guarantor's obligations under the Guaranty to the extent the same arise out of or in connection with any act or omission occurring on or before the Effective Date (“
Retained Guarantor Obligations
”) and such Retained Guarantor Obligations shall continue in full force and effect in accordance with the terms and provisions of the Guaranty; provided, however, Noteholder hereby releases Original Guarantor from its obligations under the Guaranty other than the Retained Guarantor Obligations, including but not limited to any obligations under the Guaranty to the extent the same arise out of or in connection with any act or omission occurring after the Effective Date.
|
8.
|
Escrow Account
. Assumptor acknowledges that pursuant to the purchase agreement through which it is acquiring the Property, $800,000.00 is being deposited in an escrow account (“
Escrow Funds
”) to be administered pursuant to the purchase agreement. The Escrow Funds represent rental payments on certain spaces at the Property, and Assumptor acknowledges that such Escrow Funds are therefore subject to Noteholder's security interest. For avoidance of doubt, Assumptor hereby grants to Noteholder a continuing security interest in the Escrow Funds, with the remedies granted to Noteholder in the Security Instrument or at law.
|
9.
|
Amendment to Loan Documents; Event of Default
. Section 10.1 of the Security Instrument is hereby amended to add a new item (s), which shall be inserted thereto:
|
10.
|
Representations and Warranties
.
|
a.
|
Assignment
. Borrower and Assumptor each hereby represents and warrants to Noteholder that Borrower has irrevocably and unconditionally transferred and assigned to Assumptor all of Borrower's right, title and interest in and to:
|
i.
|
The Property and the Collateral;
|
ii.
|
The Loan Documents;
|
iii.
|
All leases related to the Property or the Collateral;
|
iv.
|
All rights as named insured under all casualty and liability insurance policies (and all endorsements in connection therewith) relating to the Property or the Collateral (unless, but only to the extent that, Assumptor is obtaining its own such insurance policies);
|
v.
|
All reciprocal easement agreements, operating agreements, and declarations of conditions, covenants and restrictions related to the Property;
|
vi.
|
All prepaid rents and security deposits, if any, held by Borrower in connection with leases of any part of the Property or the Collateral; and
|
vii.
|
All funds, if any, deposited in impound accounts held by or for the benefit of Noteholder pursuant to the terms of the Loan Documents.
|
b.
|
No Defaults
. Assumptor and Borrower each hereby represents and warrants, to the best of its respective knowledge, that no default, event of default, breach or failure of condition has occurred, or would exist with notice or the lapse of time or both, under any of the Loan Documents, as modified by this Assumption Agreement, and all representations and warranties herein and in the other Loan Documents are true and correct in all material respects.
|
c.
|
Loan Documents
. Assumptor represents and warrants to Noteholder that Assumptor has actual knowledge of all terms and conditions of the Loan Documents, and agrees that Noteholder has no obligation or duty to provide any information to Assumptor regarding the terms and conditions of the Loan Documents. Assumptor further agrees that all representations, agreements and warranties in the Loan Documents regarding Borrower, its status, authority, financial condition and business shall apply to Assumptor as well as to Borrower, as though Assumptor were the borrower originally named in the Loan Documents. Assumptor further understands and acknowledges that, except as expressly provided in a writing executed by Noteholder, Noteholder has not waived any right of Noteholder or obligation of Borrower or Assumptor under the Loan Documents and Noteholder has not agreed to any modification of any provision of any Loan Document or to any extension of the Loan.
|
d.
|
Financial Statements
. Assumptor represents and warrants to Noteholder that the financial statements of Assumptor, of each member of Assumptor (if Assumptor is a limited liability company and of each New Guarantor, if any, previously delivered by Borrower, Assumptor or any of such parties to Noteholder: (i) are materially complete and correct; (ii) present fairly the financial condition of each of such parties; and (iii) have been prepared in accordance with generally accepted accounting principles consistently applied or other accounting standards approved by Noteholder. Assumptor further represents and warrants to Noteholder that, since the date of such financial statements, there has been no material adverse change in the financial condition of any of such parties, nor have any assets or properties reflected on such financial statements been sold, transferred, assigned, mortgaged, pledged or encumbered except as previously disclosed in writing by Assumptor to Noteholder
|
e.
|
Reports
. Assumptor represents and warrants to Noteholder that to the best of its knowledge, all reports, documents, instruments and information delivered to Noteholder in connection with Assumptor's assumption of the Loan: (i) are correct and sufficiently complete to give Noteholder accurate knowledge of their subject matter; and (ii) do not contain any misrepresentation of a material fact or omission of a material fact which omission makes the provided information misleading.
|
f.
|
Assumptor Location
. Assumptor represents and warrants that its chief executive office (or principal residence, if applicable) is located at the following address: c/o Whitestone REIT Operating Partnership, LP, 2600 S. Gessner Road, Suite 500, Houston, TX 77063. Assumptor represents and warrants that its state of formation is Delaware. All organizational documents of Assumptor delivered to Noteholder are complete and accurate in every respect. Assumptor's legal name is exactly as shown on page one of this Assumption Agreement. Assumptor shall not change Assumptor's name or, as applicable, Assumptor's chief executive office, Assumptor's principal residence or the jurisdiction in which Assumptor is organized, without giving Noteholder at least 30 days' prior written notice.
|
g.
|
No Pledge of Equity Interests
. Assumptor represents and warrants to Noteholder that all funds provided by Assumptor's constituents to Assumptor are in the form of capital contributions and are not loans to Assumptor. Assumptor hereby represents and warrants to Noteholder that neither the Property nor the direct ownership interests in Assumptor have been pledged or encumbered in connection with the acquisition of the Property by Assumptor.
|
h.
|
Embargoed Person
. Assumptor and New Guarantor represent and warrant that none of the funds or other assets of Assumptor or New Guarantor constitute property of, or are beneficially owned, directly or indirectly, by any person, entity or government subject to trade restrictions under U.S. law, including but not limited to, the USA PATRIOT Act (including the anti-terrorism provisions thereof), the International Economic Powers Act, 50 U.S.C. §§ 1701, et. seq., the Trading with the Enemy Act, 50 U.S.C. App. 1 et. seq., and any Executive Orders or regulations promulgated thereunder, including those related to Specially Designated Nationals and Specially Designated Global Terrorists (“
Embargoed Person
”) and further warrant and represent that no Embargoed Person has any interest of any nature whatsoever in Assumptor or New Guarantor with the result that the investment in Assumptor (whether directly or indirectly) is prohibited by law. Notwithstanding the aforementioned, Assumptor and New Guarantor shall have no duty to investigate or confirm whether any shareholder or unit holder of New Guarantor are in compliance with the foregoing and any violation by such shareholders or unit holders shall not be a breach hereunder.
|
11.
|
Cash Management
. Assumptor hereby acknowledges that it is assuming the Cash Management Agreement, as amended by this Assumption Agreement, and further acknowledges and ratifies its obligations to (i) establish the Clearing Account (as defined in the Cash Management Agreement), and (ii) pursuant to the terms of the Cash Management Agreement, cause all rents and other revenues of every kind pertaining to the Property to be forwarded to Noteholder or its designee for deposit into the Clearing Account, Notwithstanding anything to the contrary in the Cash Management Agreement, the Clearing Account shall be assigned the federal tax identification number of Assumptor, which number is 45-4023706. Noteholder agrees that that certain Clearing Account Agreement entered into on or about December 1, 2003 among Noteholder, City National Bank and Original Lender
|
12.
|
Waiver of Acceleration
. Noteholder hereby consents to the sale and conveyance of the Property and Collateral and agrees that it shall not exercise its right to cause all sums secured by the Security Instrument to become immediately due and payable because of the conveyance of the Property and the Collateral from Borrower to Assumptor;
provided
,
however
, Noteholder reserves its right under the terms of the Security instrument or any other Loan Document to accelerate all principal and interest in the event of any subsequent sale, transfer, encumbrance or other conveyance of the Property, the Collateral or any interest in Assumptor, except as permitted by the Loan Documents.
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13.
|
Hazardous Materials
. Without in any way limiting any other provision of this Assumption Agreement, Assumptor and Borrower expressly reaffirm as of the date hereof, and Assumptor reaffirms continuing hereafter: (a) each and every representation and warranty in the Loan Documents respecting “
Hazardous Materials
”; and (b) each and every covenant and indemnity in the Loan Documents respecting “
Hazardous Materials
”.
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14.
|
Multiple Parties
. If more than entity has signed this Assumption Agreement as Assumptor or Borrower, then all references in this Assumption Agreement to Assumptor or Borrower shall mean each and all of the persons so signing, as applicable. The liability of all entities signing shall be joint and several with all others similarly liable.
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15.
|
Confirmation of Security Interest
. Nothing contained herein shall affect or be construed to affect any lien, charge or encumbrance created by any Loan Document or the priority of that lien, charge or encumbrance. All assignments and transfers by Borrower to Assumptor are subject to any security interest(s) held by Noteholder.
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16.
|
Notices
. All notices to be given to Assumptor pursuant to the Loan Documents shall be addressed as follows:
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17.
|
Integration; Interpretation
. The Loan Documents, including this Assumption Agreement, contain or expressly incorporate by reference the entire agreement of the parties with respect to the matters contemplated herein and supersede all prior negotiations. The Loan Documents shall not be modified except by written instrument executed by Noteholder and Assumptor; provided, however, the Loan Documents may not be modified in a manner that creates any additional obligations or liability on the part of Borrower and/or Original Guarantor beyond the liability and obligations of Borrower and Original Guarantor as set forth in this Assumption Agreement. Any reference in any of the Loan Documents to the property or the Collateral shall include all or any parts of the Property or the Collateral.
|
18.
|
Successors and Assigns
. This Assumption Agreement is binding upon and shall inure to the benefit of the heirs, successors and assigns of the parties but subject to all prohibitions of transfers contained in any Loan Document.
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19.
|
Attorneys' Fees; Enforcement
. If any attorney is engaged by Noteholder to enforce, construe or defend any provision of this Assumption Agreement, or as a consequence of any default under or breach of this Assumption Agreement, with or without the filing of any legal action or proceeding, Assumptor shall pay to Noteholder, upon demand, the amount of all attorneys' fees and costs reasonably incurred by Noteholder in connection therewith, together with
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20.
|
Right of Transfer of Property
. The parties acknowledge that Article 8 of the Security Instrument provides that Noteholder shall consent to the voluntary sale or exchange of all of the Property, all subject, however, to the terms and conditions set forth therein,. The parties agree that this Assumption Agreement and the actions to be taken as contemplated herein shall constitute one such consent.
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21.
|
Deferred Maintenance
. Assumptor covenants and agrees that it will either (i) provide evidence, including but not limited to, receipts that the Deferred Maintenance (as defined herein) has been completed, or (ii) establish with Noteholder an escrow to fund the costs of Deferred Maintenance. As used herein, “
Deferred Maintenance
” refers to all items listed as deferred maintenance on that certain Standard Inspection Form dated August 4, 2011 issued by RR Donnelly. Assumptor further covenants and agrees that should such items of Deferred Maintenance not be repaired within ninety (90) days hereof, that an Event of Default shall have occurred, and that Noteholder shall have all remedies available to it under the terms of the Loan Documents, including but not limited to the immediate right to accrue interest on the Loan at the Default Interest Rate.
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22.
|
Miscellaneous
.
|
a.
|
This Assumption Agreement shall be governed and interpreted in accordance with the laws of the jurisdiction(s) specified in the other Loan Documents as governing the other Loan Documents. In any action brought or arising out of this Assumption Agreement, Borrower and Assumptor, and general partners, members and joint venturers of them, hereby consent to the jurisdiction of any state or federal court having proper venue as specified in the other Loan Documents and also consent to the service of process by any means authorized by the law of such jurisdiction(s). Except as expressly provided otherwise herein, all terms used herein shall have the meaning given to them in the Loan Documents. Time is of the essence of each term of the Loan Documents, including this Assumption Agreement. If any provision of this Assumption Agreement or any of the other Loan Documents shall be determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, that portion shall be deemed severed therefrom and the remaining parts shall remain in full force as though the invalid, illegal, or unenforceable portion had not been a part thereof.
|
b.
|
Notwithstanding anything to the contrary herein, this Agreement is subject to the provisions of Article 14 of the Note as if such provisions were set forth at length herein.
|
23.
|
Counterparts
. This Assumption Agreement may be executed in any number of counterparts, each of which when executed and delivered will be deemed an original and all of which taken together will be deemed to be one and the same instrument.
|
By:
|
Wells Fargo Bank, National Association, as Master Servicer under the Pooling and Servicing Agreement dated as of December 14, 2003
|
By:
|
Whitestone REIT Operating Partnership, L.P., a Delaware limited partnership, its sole member
|
By:
|
Whitestone REIT, a Maryland real estate investment trust, its general partner
|
By:
|
/s/ John J. Dee
|
By:
|
Whitestone REIT; a Maryland real estate investment trust, its general partner
|
By:
|
/s/ John J. Dee
|
By:
|
/s/ John J. Dee
|
By:
|
SR Pinnacle LLC, a California limited liability company, its general partner
|
By:
|
Scottsdale Pinnacle Management, Inc., a Delaware corporation,
|
STATE OF
T
EXAS
|
)
|
NAME OF SUBSIDIARY
|
|
|
JURISDICTION
OF FORMATION
|
|
|
|
|
Whitestone REIT Operating Partnership, LP
|
|
|
Delaware
|
Whitestone REIT Operating Partnership III GP, LLC
|
|
|
Texas
|
Whitestone REIT Operating Partnership III LP
|
|
|
Texas
|
Whitestone REIT Operating Partnership III LP, LTD
|
|
|
Texas
|
Whitestone REIT Operating Partnership II GP, LLC
|
|
|
Delaware
|
Whitestone REIT Operating Partnership II LP
|
|
|
Texas
|
Whitestone REIT Operating Company IV, LLC
|
|
|
Texas
|
Whitestone Pima Norte LLC
|
|
|
Texas
|
Whitestone CP West LLC
|
|
|
Texas
|
Whitestone Offices LLC
|
|
|
Texas
|
Whitestone Centers LLC
|
|
|
Texas
|
Whitestone Industrial-Office LLC
|
|
|
Texas
|
Whitestone Retail Services, L.L.C.
|
|
|
Delaware
|
Whitestone Brokerage Services, L.L.C.
|
|
|
Texas
|
Whitestone SunnySlope Village, L.L.C.
|
|
|
Delaware
|
Whitestone Featherwood, LLC
|
|
|
Texas
|
Whitestone Shops At Starwood - Phase III, LLC
|
|
|
Delaware
|
Whitestone Shops At Starwood, LLC
|
|
|
Delaware
|
Whitestone Terravita Marketplace, LLC
|
|
|
Delaware
|
Whitestone Pinnacle of Scottsdale, LLC
|
|
|
Delaware
|
Whitestone Pinnacle of Scottsdale - Phase II, LLC
|
|
|
Delaware
|
Whitestone Ahwatukee Plaza, LLC
|
|
|
Delaware
|
Whitestone Brokerage Services AZ, LLC
|
|
|
Arizona
|
1.
|
I have reviewed this annual report on Form 10-K of Whitestone REIT;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
1.
|
I have reviewed this annual report on Form 10-K of Whitestone REIT;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ James C. Mastandrea
|
James C. Mastandrea
|
Chairman and Chief Executive Officer
|
/s/ David K. Holeman
|
David K. Holeman
|
Chief Financial Officer
|