Maryland
|
|
76-0594970
|
(State or Other Jurisdiction of Incorporation or
|
|
(I.R.S. Employer
|
Organization)
|
|
Identification No.)
|
|
|
|
2600 South Gessner, Suite 500, Houston, Texas
|
|
77063
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Title of each class
|
|
Name of each exchange on which registered
|
||
Common Shares of Beneficial Interest, par value $0.001 per share
|
|
New York Stock Exchange
|
•
|
For the three months ended March 31, 2018, the change decreased revenue by $3.8 million, decreased total expenses by $3.3 million, increased equity in earnings of real estate partnership by $0.7 million and increased net income by $0.2 million.
|
•
|
For the three months ended June 30, 2018, the change decreased revenue by $3.6 million, decreased total expenses by $3.2 million, increased equity in earnings of real estate partnership by $0.6 million and increased net income by $0.2 million. For the six months ended June 30, 2018, the change decreased revenue by $7.4 million, decreased total expenses by $6.5 million, increased equity in earnings of real estate partnership by $1.3 million and increased net income by $0.4 million.
|
•
|
For the three months ended September 30, 2018, the change decreased revenue by $3.9 million, decreased total expenses by $3.6 million, increased equity in earnings of real estate partnership by $0.5 million and increased net income by $0.2 million.
|
•
|
For the nine months ended September 30, 2018, the change decreased revenue by $11.3 million, decreased total expenses by $10.1 million, increased equity in earnings of real estate partnership by $1.8 million and increased net income by $0.6 million.
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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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||
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Item 1B.
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||
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Item 2.
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||
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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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||
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Item 14.
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Item 15.
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Item 16.
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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;
|
•
|
uncertainties related to the national economy, the real estate industry in general and in our specific markets;
|
•
|
legislative or regulatory changes, including changes to laws governing REITs;
|
•
|
adverse economic or real estate developments or conditions in Texas, Arizona or Illinois;
|
•
|
increases in interest rates, operating costs or general and administrative expenses, including those incurred in connection with the Quarterly Restatement;
|
•
|
availability and terms of capital and financing to fund our operations, distributions to shareholders and to refinance our indebtedness as it matures;
|
•
|
decreases in rental rates or increases in vacancy rates;
|
•
|
litigation risks, including potential litigation as a result of the Quarterly Restatement and its effects;
|
•
|
lease-up risks, including leasing risks arising from exclusivity and consent provisions in leases with significant tenants;
|
•
|
our inability to renew tenants or obtain new tenants upon the expiration of existing leases;
|
•
|
our inability to generate sufficient cash flows due to market conditions, competition, uninsured losses, changes in tax or other applicable laws;
|
•
|
the need to fund tenant improvements or other capital expenditures out of operating cash flow;
|
•
|
the risk that we are unable to raise capital for working capital, acquisitions or other uses on attractive terms or at all; and
|
•
|
our inability to improve our internal control over financial reporting and disclosure controls and procedures, including our inability to remediate the identified material weakness, and the costs and time associated with such efforts.
|
•
|
Strategically Acquiring Properties.
|
◦
|
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 Austin, Chicago, Dallas-Fort Worth, Houston, Phoenix and San Antonio.
|
◦
|
Diversifying Geographically.
Our current portfolio is concentrated in Houston and Phoenix. As of
December 31, 2018
, we wholly-owned
57
commercial properties, including
15
properties in Houston,
seven
properties in Dallas-Fort Worth,
three
properties in San Antonio,
four
properties in Austin,
27
properties in the Scottsdale and Phoenix, Arizona metropolitan areas, and
one
property in Buffalo Grove, Illinois, a suburb of Chicago.
|
◦
|
Capitalizing on Availability of Reasonably Priced Acquisition Opportunities
. We believe that currently and during the next several years there will continue to be excellent opportunities in our target markets to acquire quality properties at historically attractive prices. We intend to acquire assets in off-market transactions negotiated directly with 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 Community Centered Property
®
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.
|
•
|
Redeveloping and Re-tenanting Existing Properties.
We have substantial experience in repositioning underperforming 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 new leasable square footage 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.
|
•
|
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 we owned at the time our current management team assumed the management of the Company (the “Legacy Portfolio” or “Non-Core Properties”) 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. For example, on December 31, 2016, we contributed to Pillarstone the 14 Pillarstone Properties located in Dallas and Houston that were part of the Legacy Portfolio.
|
•
|
Prudent Management of Capital Structure.
Of our
57
properties, we currently have
48
properties that are unencumbered. 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 at or less than 60%. As of
December 31, 2018
, our ratio of total indebtedness to undepreciated book value of real estate assets was
58%
.
|
•
|
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.
|
•
|
conditions in financial markets;
|
•
|
continuing deterioration of the brick-and-mortar retail industry;
|
•
|
over-building in our markets;
|
•
|
a reduction in rental income as the result of the inability to maintain occupancy levels;
|
•
|
adverse changes in applicable tax, real estate, environmental or zoning laws;
|
•
|
changes in general economic conditions or economic conditions in our markets;
|
•
|
a taking of any of our properties by eminent domain;
|
•
|
adverse local conditions (such as changes in real estate zoning laws that may reduce the desirability of real estate in the area);
|
•
|
acts of God, such as hurricanes, earthquakes or floods and other uninsured losses;
|
•
|
changes in supply of or demand for similar or competing properties in an area;
|
•
|
changes in interest rates and availability of permanent debt capital, which may render the sale of a property difficult or unattractive; and
|
•
|
periods of high interest rates, inflation or tight money supply.
|
•
|
tenants may choose not to, or may not have the financial resources to, renew these leases;
|
•
|
we may experience significant costs associated with re-leasing a significant amount of our available space;
|
•
|
we may experience difficulties and significant time lags re-leasing vacated space, which may cause us to fail to meet our occupancy and average base rent targets and experience increased costs of re-leasing; and
|
•
|
the terms of any renewal or re-lease may be less favorable than the terms of the current leases.
|
•
|
competition from other real estate investors with significant capital, including other REITs and institutional investment funds;
|
•
|
competition from other potential acquirers which may significantly increase the purchase price for a property we acquire, which could reduce our growth prospects;
|
•
|
unsatisfactory results of our due diligence investigations or failure to meet other customary closing conditions;
|
•
|
the failure of an acquired property to perform as expected; and
|
•
|
failure to finance an acquisition on favorable terms or at all.
|
•
|
$250.0 million unsecured revolving credit facility with a maturity date of January 1, 2023 (the “2019 Revolver”);
|
•
|
$165.0 million unsecured term loan with a maturity date of January 31, 2024 (“Term Loan A”); and
|
•
|
$100.0 million unsecured term loan with a maturity date of October 30, 2022 (“Term Loan B” and together with Term Loan A, the “2019 Term Loans”).
|
•
|
maximum total indebtedness to total asset value ratio of 0.60 to 1.00;
|
•
|
maximum secured debt to total asset value ratio of 0.40 to 1.00;
|
•
|
minimum EBITDA (earnings before interest, taxes, depreciation, amortization or extraordinary items) to fixed charges ratio of 1.50 to 1.00;
|
•
|
maximum other recourse debt to total asset value ratio of 0.15 to 1.00; and
|
•
|
maintenance of a minimum tangible net worth (adjusted for accumulated depreciation and amortization) of $372 million plus 75% of the net proceeds from additional equity offerings.
|
•
|
a merger, tender offer or proxy contest;
|
•
|
assumption of control by a holder of a large block of our shares; or
|
•
|
removal of incumbent management.
|
•
|
we would not be allowed to deduct our distributions to shareholders when computing our taxable income;
|
•
|
we would be subject to federal income tax on our taxable income at regular corporate rates;
|
•
|
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;
|
•
|
our cash available for distributions to shareholders would be reduced; and
|
•
|
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.
|
•
|
the amount of cash available for distribution;
|
•
|
our Operating Partnership’s financial condition;
|
•
|
our Operating Partnership’s capital expenditure requirements; and
|
•
|
our annual distribution requirements necessary to maintain our qualification as a REIT.
|
Commercial Properties
|
|
GLA
|
|
Average
Occupancy as of
12/31/18
|
|
Annualized Base
Rental Revenue
(in thousands)
(1)
|
|
Average
Annualized Base
Rental Revenue
Per Sq. Ft.
(2)
|
||||||
Whitestone
|
|
4,841,660
|
|
|
90
|
%
|
|
$
|
82,055
|
|
|
$
|
18.83
|
|
(1)
|
Calculated as the tenant’s actual
December 31, 2018
base rent (defined as cash base rents including abatements) multiplied by 12. Excludes vacant space as of
December 31, 2018
. Because annualized base rental revenue is not derived from historical results that were accounted for in accordance with GAAP, historical results differ from the annualized amounts. Total abatements for leases in effect as of
December 31, 2018
equaled approximately $152,000 for the month ended
December 31, 2018
.
|
(2)
|
Calculated as annualized base rent divided by GLA leased as of
December 31, 2018
. Excludes vacant space as of
December 31, 2018
.
|
|
|
July
|
|
Aug.
|
|
Sept.
|
|
Oct.
|
|
Nov.
|
|
Dec.
|
|
||||||
National
(1)
|
|
3.9
|
%
|
|
3.8
|
%
|
|
3.7
|
%
|
|
3.8
|
%
|
|
3.7
|
%
|
|
3.9
|
%
|
|
Houston
(2)
|
|
4.4
|
%
|
|
4.3
|
%
|
|
4.1
|
%
|
|
3.8
|
%
|
|
3.8
|
%
|
|
3.9
|
%
|
(3)
|
Phoenix
(2)
|
|
4.3
|
%
|
|
4.5
|
%
|
|
4.2
|
%
|
|
3.9
|
%
|
|
3.9
|
%
|
|
4.5
|
%
|
(3)
|
(1)
|
Seasonally adjusted.
|
(2)
|
Not seasonally adjusted.
|
(3)
|
Represents estimate.
|
Whitestone REIT and Subsidiaries
Property Details
As of December 31, 2018
|
||||||||||||||||||||||
Community Name
|
|
Location
|
|
Year Built/
Renovated
|
|
Gross Leasable
Square Feet
|
|
Percent
Occupied at
12/31/2018
|
|
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)
|
||||||||
Whitestone Properties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Ahwatukee Plaza
|
|
Phoenix
|
|
1979
|
|
72,650
|
|
|
86
|
%
|
|
$
|
801
|
|
|
$
|
12.82
|
|
|
$
|
12.76
|
|
Anthem Marketplace
|
|
Phoenix
|
|
2000
|
|
113,293
|
|
|
96
|
%
|
|
1,735
|
|
|
15.95
|
|
|
15.56
|
|
|||
Bissonnet Beltway
|
|
Houston
|
|
1978
|
|
29,205
|
|
|
80
|
%
|
|
335
|
|
|
14.34
|
|
|
13.78
|
|
|||
BLVD Place
|
|
Houston
|
|
2014
|
|
216,944
|
|
|
99
|
%
|
|
8,277
|
|
|
38.54
|
|
|
43.30
|
|
|||
The Citadel
|
|
Phoenix
|
|
2013
|
|
28,547
|
|
|
89
|
%
|
|
466
|
|
|
18.34
|
|
|
16.14
|
|
|||
City View Village
|
|
San Antonio
|
|
2005
|
|
17,870
|
|
|
100
|
%
|
|
488
|
|
|
27.31
|
|
|
28.60
|
|
|||
Davenport Village
|
|
Austin
|
|
1999
|
|
128,934
|
|
|
100
|
%
|
|
3,334
|
|
|
25.86
|
|
|
25.74
|
|
|||
Desert Canyon
|
|
Phoenix
|
|
2000
|
|
62,533
|
|
|
87
|
%
|
|
799
|
|
|
14.69
|
|
|
14.70
|
|
|||
Eldorado Plaza
|
|
Dallas
|
|
2004
|
|
221,577
|
|
|
98
|
%
|
|
3,217
|
|
|
14.81
|
|
|
15.27
|
|
|||
Fountain Hills
|
|
Phoenix
|
|
2009
|
|
111,289
|
|
|
85
|
%
|
|
1,586
|
|
|
16.77
|
|
|
16.89
|
|
|||
Fountain Square
|
|
Phoenix
|
|
1986
|
|
118,209
|
|
|
88
|
%
|
|
1,851
|
|
|
17.79
|
|
|
17.31
|
|
|||
Fulton Ranch Towne Center
|
|
Phoenix
|
|
2005
|
|
120,575
|
|
|
87
|
%
|
|
1,746
|
|
|
16.64
|
|
|
17.96
|
|
|||
Gilbert Tuscany Village
|
|
Phoenix
|
|
2009
|
|
49,415
|
|
|
100
|
%
|
|
954
|
|
|
19.31
|
|
|
18.82
|
|
|||
Gilbert Tuscany Village Hard Corner
|
|
Phoenix
|
|
2009
|
|
14,603
|
|
|
100
|
%
|
|
124
|
|
|
8.49
|
|
|
8.90
|
|
|||
Heritage Trace Plaza
|
|
Dallas
|
|
2006
|
|
70,431
|
|
|
91
|
%
|
|
1,407
|
|
|
21.95
|
|
|
23.22
|
|
|||
Headquarters Village
|
|
Dallas
|
|
2009
|
|
89,134
|
|
|
84
|
%
|
|
2,148
|
|
|
28.69
|
|
|
29.49
|
|
|||
Keller Place
|
|
Dallas
|
|
2001
|
|
93,541
|
|
|
95
|
%
|
|
889
|
|
|
10.00
|
|
|
10.29
|
|
|||
Kempwood Plaza
|
|
Houston
|
|
1974
|
|
91,302
|
|
|
89
|
%
|
|
949
|
|
|
11.68
|
|
|
12.31
|
|
|||
La Mirada
|
|
Phoenix
|
|
1997
|
|
147,209
|
|
|
81
|
%
|
|
2,515
|
|
|
21.09
|
|
|
21.95
|
|
|||
Lion Square
|
|
Houston
|
|
2014
|
|
117,592
|
|
|
98
|
%
|
|
1,501
|
|
|
13.02
|
|
|
12.70
|
|
|||
The Marketplace at Central
|
|
Phoenix
|
|
2012
|
|
111,130
|
|
|
99
|
%
|
|
1,001
|
|
|
9.10
|
|
|
8.69
|
|
|||
Market Street at DC Ranch
|
|
Phoenix
|
|
2003
|
|
242,459
|
|
|
92
|
%
|
|
4,417
|
|
|
19.80
|
|
|
19.74
|
|
|||
Mercado at Scottsdale Ranch
|
|
Phoenix
|
|
1987
|
|
118,730
|
|
|
87
|
%
|
|
1,620
|
|
|
15.68
|
|
|
16.24
|
|
|||
Paradise Plaza
|
|
Phoenix
|
|
1983
|
|
125,898
|
|
|
87
|
%
|
|
1,551
|
|
|
14.16
|
|
|
13.96
|
|
|||
Parkside Village North
|
|
Austin
|
|
2005
|
|
27,045
|
|
|
100
|
%
|
|
811
|
|
|
29.99
|
|
|
30.58
|
|
|||
Parkside Village South
|
|
Austin
|
|
2012
|
|
90,101
|
|
|
100
|
%
|
|
2,338
|
|
|
25.95
|
|
|
26.78
|
|
|||
Pima Norte
|
|
Phoenix
|
|
2007
|
|
35,110
|
|
|
68
|
%
|
|
426
|
|
|
17.84
|
|
|
18.56
|
|
|||
Pinnacle of Scottsdale
|
|
Phoenix
|
|
1991
|
|
113,108
|
|
|
100
|
%
|
|
2,411
|
|
|
21.32
|
|
|
21.87
|
|
|||
Pinnacle Phase II
|
|
Phoenix
|
|
2017
|
|
27,063
|
|
|
100
|
%
|
|
648
|
|
|
23.94
|
|
|
23.69
|
|
|||
The Promenade at Fulton Ranch
|
|
Phoenix
|
|
2007
|
|
98,792
|
|
|
87
|
%
|
|
1,138
|
|
|
13.24
|
|
|
15.01
|
|
|||
Providence
|
|
Houston
|
|
1980
|
|
90,327
|
|
|
99
|
%
|
|
804
|
|
|
8.99
|
|
|
9.01
|
|
|||
Quinlan Crossing
|
|
Austin
|
|
2012
|
|
109,892
|
|
|
98
|
%
|
|
2,339
|
|
|
21.72
|
|
|
23.92
|
|
|||
Seville
|
|
Phoenix
|
|
1990
|
|
90,042
|
|
|
72
|
%
|
|
2,202
|
|
|
33.97
|
|
|
34.17
|
|
|||
Shaver
|
|
Houston
|
|
1978
|
|
21,926
|
|
|
94
|
%
|
|
292
|
|
|
14.17
|
|
|
14.07
|
|
|||
Shops at Pecos Ranch
|
|
Phoenix
|
|
2009
|
|
78,767
|
|
|
80
|
%
|
|
1,678
|
|
|
26.63
|
|
|
26.14
|
|
|||
Shops at Starwood
|
|
Dallas
|
|
2006
|
|
55,385
|
|
|
92
|
%
|
|
1,455
|
|
|
28.56
|
|
|
29.69
|
|
|||
The Shops at Williams Trace
|
|
Houston
|
|
1985
|
|
132,991
|
|
|
96
|
%
|
|
1,980
|
|
|
15.51
|
|
|
15.40
|
|
|||
South Richey
|
|
Houston
|
|
1980
|
|
69,928
|
|
|
97
|
%
|
|
715
|
|
|
10.54
|
|
|
10.72
|
|
|||
Spoerlein Commons
|
|
Chicago
|
|
1987
|
|
41,455
|
|
|
79
|
%
|
|
639
|
|
|
19.51
|
|
|
19.51
|
|
|||
Starwood Phase II
|
|
Dallas
|
|
2016
|
|
35,351
|
|
|
72
|
%
|
|
866
|
|
|
34.02
|
|
|
37.17
|
|
|||
The Strand at Huebner Oaks
|
|
San Antonio
|
|
2000
|
|
73,920
|
|
|
98
|
%
|
|
1,464
|
|
|
20.21
|
|
|
22.06
|
|
|||
SugarPark Plaza
|
|
Houston
|
|
1974
|
|
95,032
|
|
|
100
|
%
|
|
1,126
|
|
|
11.85
|
|
|
13.80
|
|
Whitestone REIT and Subsidiaries
Property Details
As of December 31, 2018
|
||||||||||||||||||||||
Community Name
|
|
Location
|
|
Year Built/
Renovated
|
|
Gross Leasable
Square Feet
|
|
Percent
Occupied at
12/31/2018
|
|
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)
|
||||||||
Sunridge
|
|
Houston
|
|
1979
|
|
49,359
|
|
|
83
|
%
|
|
531
|
|
|
12.96
|
|
|
12.50
|
|
|||
Sunset at Pinnacle Peak
|
|
Phoenix
|
|
2000
|
|
41,530
|
|
|
82
|
%
|
|
611
|
|
|
17.94
|
|
|
18.24
|
|
|||
Terravita Marketplace
|
|
Phoenix
|
|
1997
|
|
102,733
|
|
|
50
|
%
|
|
1,142
|
|
|
22.23
|
|
|
22.35
|
|
|||
Town Park
|
|
Houston
|
|
1978
|
|
43,526
|
|
|
100
|
%
|
|
946
|
|
|
21.73
|
|
|
21.71
|
|
|||
Village Square at Dana Park
|
|
Phoenix
|
|
2009
|
|
323,026
|
|
|
87
|
%
|
|
6,107
|
|
|
21.73
|
|
|
21.54
|
|
|||
Westchase
|
|
Houston
|
|
1978
|
|
50,332
|
|
|
86
|
%
|
|
633
|
|
|
14.62
|
|
|
14.30
|
|
|||
Williams Trace Plaza
|
|
Houston
|
|
1983
|
|
129,222
|
|
|
94
|
%
|
|
1,780
|
|
|
14.65
|
|
|
15.19
|
|
|||
Windsor Park
|
|
San Antonio
|
|
2012
|
|
196,458
|
|
|
97
|
%
|
|
1,876
|
|
|
9.84
|
|
|
9.65
|
|
|||
Woodlake Plaza
|
|
Houston
|
|
1974
|
|
106,169
|
|
|
80
|
%
|
|
1,386
|
|
|
16.32
|
|
|
15.99
|
|
|||
Total/Weighted Average - Whitestone Properties
|
|
|
|
|
|
4,841,660
|
|
|
90
|
%
|
|
82,055
|
|
|
18.83
|
|
|
19.35
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Land Held for Development:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Anthem Marketplace
|
|
Phoenix
|
|
N/A
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
BLVD Phase II-B
|
|
Houston
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Dana Park Development
|
|
Phoenix
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Eldorado Plaza Development
|
|
Dallas
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Fountain Hills
|
|
Phoenix
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Market Street at DC Ranch
|
|
Phoenix
|
|
N/A
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total/Weighted Average - Land Held For Development
(4)
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Grand Total/Weighted Average - Whitestone Properties
|
|
|
|
|
|
4,841,660
|
|
|
90
|
%
|
|
$
|
82,055
|
|
|
$
|
18.83
|
|
|
$
|
19.35
|
|
(1)
|
Calculated as the tenant’s actual
December 31, 2018
base rent (defined as cash base rents including abatements) multiplied by 12. Excludes vacant space as of
December 31, 2018
. 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, 2018
equaled approximately $152,000 for the month ended
December 31, 2018
.
|
(2)
|
Calculated as annualized base rent divided by gross leasable area leased as of
December 31, 2018
. Excludes vacant space as of
December 31, 2018
.
|
(3)
|
Represents (i) the contractual base rent for leases in place as of
December 31, 2018
, adjusted to 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, 2018
.
|
(4)
|
As of
December 31, 2018
, these parcels of land were held for development and, therefore, had no gross leasable area.
|
Tenant Name
|
|
Location
|
|
Annualized Rental Revenue (in thousands)
|
|
Percentage of Total Annualized Base Rental Revenues
(1)
|
|
Initial Lease Date
|
|
Year Expiring
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
Safeway Stores Incorporated
(2)
|
|
Austin, Houston and Phoenix
|
|
$
|
2,447
|
|
|
3.0
|
%
|
|
11/14/1982, 5/8/1991, 7/1/2000, 4/1/2014, 4/1/2014 and 10/19/16
|
|
2020, 2020, 2021, 2022, 2024 and 2034
|
Whole Foods Market
|
|
Houston
|
|
2,042
|
|
|
2.5
|
%
|
|
9/3/2014
|
|
2035
|
|
Frost Bank
|
|
Houston
|
|
1,872
|
|
|
2.3
|
%
|
|
7/1/2014
|
|
2024
|
|
Newmark Real Estate of Houston LLC
|
|
Houston
|
|
1,188
|
|
|
1.4
|
%
|
|
10/1/2015
|
|
2026
|
|
Walgreens & Co.
(3)
|
|
Houston and Phoenix
|
|
946
|
|
|
1.1
|
%
|
|
11/14/1982, 11/2/1987, 8/24/1996 and 11/3/1996
|
|
2022, 2027, 2049 and 2056
|
|
Verizon Wireless
(4)
|
|
Houston and Phoenix
|
|
875
|
|
|
1.1
|
%
|
|
8/16/1994, 2/1/2004, 5/10/2004, 1/27/2006 and 5/1/2014
|
|
2019, 2019, 2022, 2023 and 2024
|
|
Bashas' Inc.
(5)
|
|
Phoenix
|
|
823
|
|
|
1.0
|
%
|
|
10/9/2004 and 4/1/2009
|
|
2024 and 2029
|
|
Alamo Drafthouse Cinema
|
|
Austin
|
|
690
|
|
|
0.8
|
%
|
|
2/1/2012
|
|
2027
|
|
Dollar Tree
(6)
|
|
Houston and Phoenix
|
|
677
|
|
|
0.8
|
%
|
|
3/1/1998, 8/10/1999, 6/29/2001, 11/8/2009, 12/17/2009, and 5/21/2013
|
|
2020, 2020, 2021, 2022, 2023 and 2027
|
|
Wells Fargo & Company
(7)
|
|
Phoenix
|
|
553
|
|
|
0.7
|
%
|
|
10/24/1996 and 4/16/1999
|
|
2022 and 2023
|
|
Kroger Co.
|
|
Dallas
|
|
483
|
|
|
0.6
|
%
|
|
12/15/2000
|
|
2022
|
|
Ruth's Chris Steak House Inc.
|
|
Phoenix
|
|
466
|
|
|
0.6
|
%
|
|
1/1/1991
|
|
2030
|
|
Regus Corporation
|
|
Houston
|
|
434
|
|
|
0.5
|
%
|
|
5/23/2014
|
|
2025
|
|
Paul's Ace Hardware
|
|
Phoenix
|
|
427
|
|
|
0.5
|
%
|
|
3/1/2008
|
|
2023
|
|
Ross Dress for Less, Inc.
(8)
|
|
Phoenix and San Antonio
|
|
362
|
|
|
0.4
|
%
|
|
2/11/2009 and 6/18/2012
|
|
2020, 2023
|
|
|
|
|
|
$
|
14,285
|
|
|
17.3
|
%
|
|
|
|
|
(1)
|
Annualized Base Rental Revenues represents the monthly base rent as of
December 31, 2018
for each applicable tenant multiplied by 12.
|
(2)
|
As of
December 31, 2018
, we had six leases with the same tenant occupying space at properties located in Phoenix, Houston and Austin. The annualized rental revenue for the lease that commenced on April 1, 2014, and is scheduled to expire in 2034, was $997,000, which represents approximately 1.2% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on April 1, 2014, and is scheduled to expire in 2024, was $42,000, which represents less than 0.1% of our annualized base rental revenue. The annualized rental revenue for the lease that commenced on May 8, 1991, and is scheduled to expire in 2021, was $344,000, which represents approximately 0.4% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on July 1, 2000, and is scheduled to expire in 2020, was $321,000, which represents approximately 0.4% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on November 14, 1982, and is scheduled to expire in 2022, was $318,000, which represents approximately 0.4% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on October 19, 2016, and is scheduled to expire in 2020, was $425,000, which represents approximately 0.5% of our total annualized base rental revenue.
|
(3)
|
As of
December 31, 2018
, we had four leases with the same tenant occupying space at properties located in Phoenix and Houston. The annualized rental revenue for the lease that commenced on November 3, 1996, and is scheduled to expire in 2049, was $279,000, which represents approximately 0.3% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on November 2, 1987, and is scheduled to expire in 2027, was $188,000, which represents approximately 0.2% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on November 14, 1982, and is scheduled to expire in 2022, was $181,000, which represents approximately 0.2% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on August 24, 1996, and is scheduled to expire in 2056, was $298,000, which represents approximately 0.4% of our total annualized rental revenue.
|
(4)
|
As of
December 31, 2018
, we had five leases with the same tenant occupying space at properties located in Phoenix and Houston. The annualized rental revenue for the lease that commenced on August 16, 1994, and is scheduled to expire in 2019, was $21,000, which represents less than 0.1% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on January 27, 2006, and is scheduled to expire in 2023, was $130,000, which represents approximately 0.2% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on February 1, 2004, and is scheduled to expire in 2019, was $37,000, which represents less than 0.1% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on May 1, 2014, and is scheduled to expire in 2024, was $681,000, which represents approximately 0.8% of our total annualized rental revenue. The annualized rental revenue for the lease that commenced on May 10, 2004, and is scheduled to expire in 2022, was $6,000, which represents less than 0.1% of our total annualized base rental revenue.
|
(5)
|
As of
December 31, 2018
, we had two leases with the same tenant occupying space at properties located in Phoenix. The annualized rental revenue for the lease that commenced on October 9, 2004, and is scheduled to expire in 2024, was $119,000, which represents approximately 0.1% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on April 1, 2009, and is scheduled to expire in 2029, was $704,000, which represents approximately 0.9% of our total annualized base rental revenue.
|
(6)
|
As of
December 31, 2018
, we had six leases with the same tenant occupying space at properties in Houston and Phoenix. The annualized rental revenue for the lease that commenced on March 1, 1998, and is scheduled to expire in 2022, was $73,000, which represents less than 0.1% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on August 10, 1999, and is scheduled to expire in 2020, was $88,000, which represents approximately 0.1% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on December 17, 2009, and is scheduled to expire in 2020, was $110,000, which represents approximately 0.1% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on June 29, 2001, and is scheduled to expire in 2021, was $145,000, which represents approximately 0.2% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on May 21, 2013, and is scheduled to expire in 2023, was $111,000, which represents approximately 0.1% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on November 8, 2009, and is scheduled to expire in 2027, was $151,000, which represents approximately 0.2% of our total annualized base rental revenue.
|
(7)
|
As of
December 31, 2018
, we had two leases with the same tenant occupying space at properties located in Phoenix. The annualized rental revenue for the lease that commenced on October 24, 1996, and is scheduled to expire in 2022, was $131,000, which represents approximately 0.2% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on April 16, 1999, and is scheduled to expire in 2023, was $421,000, which represents approximately 0.5% of our total annualized base rental revenue.
|
(8)
|
As of
December 31, 2018
, we had two leases with the same tenant occupying space at properties located in San Antonio and Phoenix. The annualized rental revenue for the lease that commenced on June 18, 2012, and is scheduled to expire in 2023, was $175,000, which represents approximately 0.2% of our total annualized base rental revenue. The annualized rental revenue for the lease that commenced on February 11, 2009, and is scheduled to expire in 2020, was $187,000, which represents approximately 0.2% of our total annualized base rental revenue.
|
|
|
|
|
|
|
|
|
Annualized Base Rent
|
||||||||
|
|
|
|
GLA
|
|
as of December 31, 2018
|
||||||||||
Year
|
|
Number of
Leases |
|
Approximate
Square Feet |
|
Percent of
Total |
|
Amount
(in thousands) |
|
Percent of
Total |
||||||
2019
|
|
370
|
|
|
633,907
|
|
|
13.1
|
%
|
|
$
|
12,998
|
|
|
15.8
|
%
|
2020
|
|
219
|
|
|
786,854
|
|
|
16.3
|
%
|
|
13,032
|
|
|
15.8
|
%
|
|
2021
|
|
198
|
|
|
512,859
|
|
|
10.6
|
%
|
|
9,994
|
|
|
12.1
|
%
|
|
2022
|
|
167
|
|
|
626,485
|
|
|
12.9
|
%
|
|
11,220
|
|
|
13.6
|
%
|
|
2023
|
|
154
|
|
|
474,322
|
|
|
9.8
|
%
|
|
9,437
|
|
|
11.4
|
%
|
|
2024
|
|
79
|
|
|
477,378
|
|
|
9.9
|
%
|
|
7,664
|
|
|
9.3
|
%
|
|
2025
|
|
43
|
|
|
156,796
|
|
|
3.2
|
%
|
|
3,614
|
|
|
4.4
|
%
|
|
2026
|
|
26
|
|
|
172,237
|
|
|
3.6
|
%
|
|
3,309
|
|
|
4.0
|
%
|
|
2027
|
|
26
|
|
|
173,391
|
|
|
3.6
|
%
|
|
3,457
|
|
|
4.2
|
%
|
|
2028
|
|
21
|
|
|
98,415
|
|
|
2.0
|
%
|
|
2,131
|
|
|
2.6
|
%
|
|
Total
|
|
1,303
|
|
|
4,112,644
|
|
|
85.0
|
%
|
|
$
|
76,856
|
|
|
93.2
|
%
|
•
|
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.
|
|
|
Common Shares
|
|
Noncontrolling OP Unit Holders
|
|
Total
|
||||||||||||||
Quarter Paid
|
|
Distributions Per Common Share
|
|
Total Amount Paid
|
|
Distributions Per OP Unit
|
|
Total Amount Paid
|
|
Total Amount Paid
|
||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
11,302
|
|
|
$
|
0.2850
|
|
|
$
|
265
|
|
|
$
|
11,567
|
|
Third Quarter
|
|
0.2850
|
|
|
11,294
|
|
|
0.2850
|
|
|
286
|
|
|
11,580
|
|
|||||
Second Quarter
|
|
0.2850
|
|
|
11,203
|
|
|
0.2850
|
|
|
295
|
|
|
11,498
|
|
|||||
First Quarter
|
|
0.2850
|
|
|
11,145
|
|
|
0.2850
|
|
|
309
|
|
|
11,454
|
|
|||||
Total
|
|
$
|
1.1400
|
|
|
$
|
44,944
|
|
|
$
|
1.1400
|
|
|
$
|
1,155
|
|
|
$
|
46,099
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
11,002
|
|
|
$
|
0.2850
|
|
|
$
|
309
|
|
|
$
|
11,311
|
|
Third Quarter
|
|
0.2850
|
|
|
10,948
|
|
|
0.2850
|
|
|
309
|
|
|
11,257
|
|
|||||
Second Quarter
|
|
0.2850
|
|
|
10,093
|
|
|
0.2850
|
|
|
310
|
|
|
10,403
|
|
|||||
First Quarter
|
|
0.2850
|
|
|
8,429
|
|
|
0.2850
|
|
|
313
|
|
|
8,742
|
|
|||||
Total
|
|
$
|
1.1400
|
|
|
$
|
40,472
|
|
|
$
|
1.1400
|
|
|
$
|
1,241
|
|
|
$
|
41,713
|
|
Period
|
|
Total Number of Shares Purchased
(1)
|
|
Average Price Paid for Shares
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number of Shares that May Yet be Purchased Under the Plans or Programs
|
|||
October 1, 2018 through October 31, 2018
|
|
—
|
|
|
$
|
—
|
|
|
N/A
|
|
N/A
|
November 1, 2018 through November 30, 2018
|
|
—
|
|
|
—
|
|
|
N/A
|
|
N/A
|
|
December 1, 2018 through December 31, 2018
|
|
21,414
|
|
|
12.26
|
|
|
N/A
|
|
N/A
|
|
Total
|
|
21,414
|
|
|
$
|
12.26
|
|
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
(in thousands, except per share and per square foot data)
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
119,863
|
|
|
$
|
125,959
|
|
|
$
|
104,437
|
|
|
$
|
93,416
|
|
|
$
|
72,382
|
|
Property expenses
|
|
37,431
|
|
|
42,110
|
|
|
34,092
|
|
|
31,335
|
|
|
25,152
|
|
|||||
General and administrative
|
|
23,281
|
|
|
23,949
|
|
|
23,922
|
|
|
20,312
|
|
|
15,274
|
|
|||||
Depreciation and amortization
|
|
25,679
|
|
|
27,240
|
|
|
22,457
|
|
|
19,761
|
|
|
15,725
|
|
|||||
Equity in earnings of real estate partnership
|
|
(8,431
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Interest expense
|
|
25,177
|
|
|
23,651
|
|
|
19,239
|
|
|
14,910
|
|
|
10,579
|
|
|||||
Interest, dividend and other investment income
|
|
(1,055
|
)
|
|
(410
|
)
|
|
(429
|
)
|
|
(313
|
)
|
|
(90
|
)
|
|||||
Income from continuing operations before loss on disposal of assets and income taxes
|
|
17,781
|
|
|
9,419
|
|
|
5,156
|
|
|
7,411
|
|
|
5,742
|
|
|||||
Provision for income taxes
|
|
(347
|
)
|
|
(386
|
)
|
|
(289
|
)
|
|
(372
|
)
|
|
(282
|
)
|
|||||
Gain on sale of property
|
|
4,629
|
|
|
16
|
|
|
3,357
|
|
|
—
|
|
|
—
|
|
|||||
Profit sharing expense
|
|
—
|
|
|
(278
|
)
|
|
(15
|
)
|
|
—
|
|
|
—
|
|
|||||
Loss on disposal of assets
|
|
(82
|
)
|
|
(183
|
)
|
|
(96
|
)
|
|
(185
|
)
|
|
(111
|
)
|
|||||
Income from continuing operations
|
|
21,981
|
|
|
8,588
|
|
|
8,113
|
|
|
6,854
|
|
|
5,349
|
|
|||||
Income from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
510
|
|
|||||
Gain on sale of properties from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,887
|
|
|||||
Net income
|
|
21,981
|
|
|
8,588
|
|
|
8,113
|
|
|
6,865
|
|
|
7,746
|
|
|||||
Less: net income attributable to noncontrolling interests
|
|
550
|
|
|
254
|
|
|
182
|
|
|
116
|
|
|
160
|
|
|||||
Net income attributable to Whitestone REIT
|
|
$
|
21,431
|
|
|
$
|
8,334
|
|
|
$
|
7,931
|
|
|
$
|
6,749
|
|
|
$
|
7,586
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
(in thousands, except per share data and per square foot and occupancy)
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Earnings per share - basic
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations attributable to Whitestone REIT excluding amounts attributable to unvested restricted shares
|
|
$
|
0.54
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
|
$
|
0.25
|
|
|
$
|
0.23
|
|
Income from discontinued operations attributable to Whitestone REIT
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.10
|
|
|||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.54
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
|
$
|
0.25
|
|
|
$
|
0.33
|
|
Earnings per share - diluted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income from continuing operations attributable to Whitestone REIT excluding amounts attributable to unvested restricted shares
|
|
$
|
0.52
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
|
$
|
0.24
|
|
|
$
|
0.22
|
|
Income from discontinued operations attributable to Whitestone REIT
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.10
|
|
|||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.52
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
|
$
|
0.24
|
|
|
$
|
0.32
|
|
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real estate (net)
|
|
$
|
938,938
|
|
|
$
|
1,018,420
|
|
|
$
|
813,052
|
|
|
$
|
745,958
|
|
|
$
|
602,068
|
|
Other assets
|
|
89,934
|
|
|
51,748
|
|
|
38,327
|
|
|
36,127
|
|
|
30,137
|
|
|||||
Total assets
|
|
$
|
1,028,872
|
|
|
$
|
1,070,168
|
|
|
$
|
851,379
|
|
|
$
|
782,085
|
|
|
$
|
632,205
|
|
Liabilities
|
|
$
|
669,722
|
|
|
$
|
711,764
|
|
|
$
|
583,751
|
|
|
$
|
535,094
|
|
|
$
|
418,882
|
|
Whitestone REIT shareholders’ equity
|
|
350,456
|
|
|
347,604
|
|
|
255,687
|
|
|
242,974
|
|
|
210,072
|
|
|||||
Noncontrolling interest in subsidiary
|
|
8,694
|
|
|
10,800
|
|
|
11,941
|
|
|
4,017
|
|
|
3,251
|
|
|||||
|
|
$
|
1,028,872
|
|
|
$
|
1,070,168
|
|
|
$
|
851,379
|
|
|
$
|
782,085
|
|
|
$
|
632,205
|
|
Other Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from issuance of common shares
|
|
$
|
—
|
|
|
$
|
118,412
|
|
|
$
|
30,014
|
|
|
$
|
49,649
|
|
|
$
|
6,458
|
|
Acquisitions of and additions to real estate
(1)
|
|
$
|
11,638
|
|
|
$
|
231,120
|
|
|
$
|
91,785
|
|
|
$
|
163,050
|
|
|
$
|
142,065
|
|
Distributions per share
(2)
|
|
$
|
1.14
|
|
|
$
|
1.13
|
|
|
$
|
1.13
|
|
|
$
|
1.13
|
|
|
$
|
1.13
|
|
Funds from operations
(3)
|
|
$
|
39,398
|
|
|
$
|
35,039
|
|
|
$
|
27,031
|
|
|
$
|
26,696
|
|
|
$
|
21,920
|
|
Total occupancy at year end
|
|
90
|
%
|
|
88
|
%
|
|
87
|
%
|
|
87
|
%
|
|
87
|
%
|
|||||
Average aggregate GLA
|
|
4,925
|
|
|
6,403
|
|
|
5,837
|
|
|
5,734
|
|
|
5,075
|
|
|||||
Average rent per square foot
|
|
$
|
18.81
|
|
|
$
|
16.81
|
|
|
$
|
15.45
|
|
|
$
|
14.62
|
|
|
$
|
13.57
|
|
(1)
Including amounts for discontinued operations.
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
(2)
The distributions per share represent total cash payments divided by weighted average common shares.
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
(3)
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 equity method investments and joint ventures. We calculate FFO in a manner consistent with the NAREIT definition. For more information, see “
Management’s Discussion and Analysis of Financial Condition and Results of Operations - Reconciliation of Non-GAAP Financial Measures.”
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Net income attributable to Whitestone REIT
|
|
$
|
21,431
|
|
|
$
|
8,334
|
|
|
$
|
7,931
|
|
|
$
|
6,749
|
|
|
$
|
7,586
|
|
Adjustments to reconcile to FFO:
(1)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization of real estate assets
(2)
|
|
25,401
|
|
|
26,290
|
|
|
22,179
|
|
|
19,646
|
|
|
15,950
|
|
|||||
Depreciation and amortization of real estate assets of real estate partnership (pro rata)
(3)
|
|
2,903
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Loss (gain) on sale or disposal of assets
(2)
|
|
(4,547
|
)
|
|
167
|
|
|
(3,261
|
)
|
|
185
|
|
|
(1,776
|
)
|
|||||
Gain on sale or disposal of properties or assets of real estate partnership (pro rata)
(3)
|
|
(6,340
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income attributable to redeemable operating partnership units
(2)
|
|
550
|
|
|
254
|
|
|
182
|
|
|
116
|
|
|
160
|
|
|||||
FFO
|
|
$
|
39,398
|
|
|
$
|
35,045
|
|
|
$
|
27,031
|
|
|
$
|
26,696
|
|
|
$
|
21,920
|
|
•
|
51
properties that meet our Community Centered Properties
®
strategy containing approximately
4.8 million
square feet of GLA and having a total carrying amount (net of accumulated depreciation) of
$921.1 million
; and
|
•
|
six
parcels of land held for future development that meet our Community Centered Properties
®
strategy having a total carrying amount of
$17.8 million
.
|
•
|
$250.0 million unsecured revolving credit facility with a maturity date of January 1, 2023 (the “2019 Revolver”);
|
•
|
$165.0 million unsecured term loan with a maturity date of January 31, 2024 (“Term Loan A”); and
|
•
|
$100.0 million unsecured term loan with a maturity date of October 30, 2022 (“Term Loan B” and together with Term Loan A, the “ 2019 Term Loans”).
|
•
|
maximum total indebtedness to total asset value ratio of 0.60 to 1.00;
|
•
|
maximum secured debt to total asset value ratio of 0.40 to 1.00;
|
•
|
minimum EBITDA (earnings before interest, taxes, depreciation, amortization or extraordinary items) to fixed charges ratio of 1.50 to 1.00;
|
•
|
maximum other recourse debt to total asset value ratio of 0.15 to 1.00; and
|
•
|
maintenance of a minimum tangible net worth (adjusted for accumulated depreciation and amortization) of $372 million plus 75% of the net proceeds from additional equity offerings (as defined).
|
|
|
Number of Leases Signed
|
|
GLA Signed
|
|
Weighted Average Lease Term
(2)
|
|
TI and Incentives per Sq. Ft.
(3)
|
|
Contractual Rent Per Sq. Ft
(4)
|
|
Prior Contractual Rent Per Sq. Ft.
(5)
|
|
Straight-lined Basis Increase (Decrease) Over Prior Rent
|
||||||||||
Comparable
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Renewal Leases
|
|
177
|
|
|
409,217
|
|
|
4.5
|
|
|
$
|
3.98
|
|
|
$
|
20.57
|
|
|
$
|
19.97
|
|
|
11.1
|
%
|
New Leases
|
|
48
|
|
|
84,504
|
|
|
4.9
|
|
|
9.08
|
|
|
22.94
|
|
|
23.65
|
|
|
7.0
|
%
|
|||
Total/Average
|
|
225
|
|
|
493,721
|
|
|
4.5
|
|
|
$
|
4.85
|
|
|
$
|
20.98
|
|
|
$
|
20.60
|
|
|
10.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Number of Leases Signed
|
|
GLA Signed
|
|
Weighted Average Lease Term
(2)
|
|
TI and Incentives per Sq. Ft.
(3)
|
|
Contractual Rent Per Sq. Ft
(4)
|
|
|
|
|
||||||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Renewal Leases
|
|
177
|
|
|
409,217
|
|
|
4.5
|
|
|
$
|
3.98
|
|
|
$
|
20.57
|
|
|
|
|
|
|||
New Leases
|
|
131
|
|
|
318,223
|
|
|
5.6
|
|
|
12.05
|
|
|
20.00
|
|
|
|
|
|
|||||
Total/Average
|
|
308
|
|
|
727,440
|
|
|
5.0
|
|
|
$
|
7.51
|
|
|
$
|
20.32
|
|
|
|
|
|
(1)
|
Comparable leases represent leases signed on spaces for which there was a former tenant within the last twelve months and the new or renewal square footage was within 25% of the expired square footage.
|
(2)
|
Weighted average lease term (in years) is determined on the basis of square footage.
|
(3)
|
Estimated amount per signed leases. Actual cost of construction may vary. Does not include first generation costs for tenant improvements (“TI”) and leasing commission costs needed for new acquisitions, development or redevelopment of a property to bring to operating standards for its intended use.
|
(4)
|
Contractual minimum rent under the new lease for the first month, excluding concessions.
|
(5)
|
Contractual minimum rent under the prior lease for the final month.
|
|
2018
|
|
2017
|
||||
Capital expenditures:
|
|
|
|
||||
Tenant improvements and allowances
|
$
|
4,622
|
|
|
$
|
6,646
|
|
Developments / redevelopments
|
4,142
|
|
|
6,519
|
|
||
Leasing commissions and costs
|
2,113
|
|
|
3,118
|
|
||
Maintenance capital expenditures
|
2,874
|
|
|
4,410
|
|
||
Total capital expenditures
|
$
|
13,751
|
|
|
$
|
20,693
|
|
•
|
Cash flow from operations of
$39,557,000
for the year ended
December 31, 2018
;
|
•
|
Net proceeds of
$9,000,000
from the 2018 Facility;
|
•
|
Net proceeds from financed receivable due from related party of
$9,812,000
;
|
•
|
Net proceeds of
$12,574,000
from sales of properties;
|
•
|
Net proceeds of
$30,000
from sales of marketable securities;
|
•
|
Payment of dividends and distributions to common shareholders and OP unit holders of
$46,099,000
;
|
•
|
Additions to real estate of
$11,638,000
;
|
•
|
Payments of loan origination costs of
$30,000
;
|
•
|
Payments of notes payable of
$2,543,000
;
|
•
|
Payments of exchange offer costs of
$126,000
; and
|
•
|
Repurchase of common shares of
$1,961,000
.
|
|
|
December 31,
|
||||||
Description
|
|
2018
|
|
2017
|
||||
Fixed rate notes
|
|
|
|
|
||||
$10.5 million, LIBOR plus 2.00% Note, due September 24, 2020
(1)
|
|
$
|
9,500
|
|
|
$
|
9,740
|
|
$50.0 million, 1.75% plus 1.35% to 1.90% Note, due October 30, 2020
(2)
|
|
50,000
|
|
|
50,000
|
|
||
$50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021
(3)
|
|
50,000
|
|
|
50,000
|
|
||
$100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022
(4)
|
|
100,000
|
|
|
100,000
|
|
||
$80.0 million, 3.72% Note, due June 1, 2027
|
|
80,000
|
|
|
80,000
|
|
||
$37.0 million 3.76% Note, due December 1, 2020
(5)
|
|
—
|
|
|
33,148
|
|
||
$6.5 million 3.80% Note, due January 1, 2019
|
|
5,657
|
|
|
5,842
|
|
||
$19.0 million 4.15% Note, due December 1, 2024
|
|
19,000
|
|
|
19,000
|
|
||
$20.2 million 4.28% Note, due June 6, 2023
|
|
18,996
|
|
|
19,360
|
|
||
$14.0 million 4.34% Note, due September 11, 2024
|
|
13,718
|
|
|
13,944
|
|
||
$14.3 million 4.34% Note, due September 11, 2024
|
|
14,300
|
|
|
14,300
|
|
||
$16.5 million 4.97% Note, due September 26, 2023
(5)
|
|
—
|
|
|
16,058
|
|
||
$15.1 million 4.99% Note, due January 6, 2024
|
|
14,643
|
|
|
14,865
|
|
||
$2.6 million 5.46% Note, due October 1, 2023
|
|
2,430
|
|
|
2,472
|
|
||
Floating rate notes
|
|
|
|
|
||||
Unsecured line of credit, LIBOR plus 1.40% to 1.95%, due October 30, 2019
(6)
|
|
241,200
|
|
|
232,200
|
|
||
Total notes payable principal
|
|
619,444
|
|
|
660,929
|
|
||
Less deferred financing costs, net of accumulated amortization
|
|
(1,239
|
)
|
|
(1,861
|
)
|
||
|
|
$
|
618,205
|
|
|
$
|
659,068
|
|
(1)
|
Promissory note includes an interest rate swap that fixed the interest rate at
3.55%
for the duration of the term through September 24, 2018 and 4.85% beginning September 24, 2018 through September 24, 2020.
|
(2)
|
Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 1 (as defined below) at
0.84%
through February 3, 2017 and
1.75%
beginning February 3, 2017 through October 30, 2020.
|
(3)
|
Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 2 (as defined below) at
1.50%
.
|
(4)
|
Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 3 (as defined below) at
1.73%
.
|
(5)
|
Promissory notes were assumed by Pillarstone OP in December 2016 and included in our consolidated balance sheet under the profit-sharing method of accounting through December 31, 2017 as discussed in Note 5.
|
(6)
|
Unsecured line of credit includes certain Pillarstone Properties (as defined and described in more detail below) in determining the amount of credit available under the 2018 Facility (as defined and described in more detail below).
|
•
|
extended the maturity date of the
$300 million
unsecured revolving credit facility under the 2014 Facility (the “Revolver”) to October 30, 2019 from November 7, 2018;
|
•
|
converted
$100 million
of outstanding borrowings under the Revolver to a new
$100 million
unsecured term loan under the 2014 Facility (“Term Loan 3”) with a maturity date of October 30, 2022;
|
•
|
extended the maturity date of the first
$50 million
unsecured term loan under the 2014 Facility (“Term Loan 1”) to October 30, 2020 from February 17, 2017; and
|
•
|
extended the maturity date of the second
$50 million
unsecured term loan under the 2014 Facility (“Term Loan 2” and together with Term Loan 1 and Term Loan 3, the “Term Loans”) to January 29, 2021 from November 7, 2019.
|
|
|
Amount Due
|
||
Year
|
|
(in thousands)
|
||
|
|
|
||
2019
|
|
$
|
248,199
|
|
2020
|
|
60,801
|
|
|
2021
|
|
51,611
|
|
|
2022
|
|
101,683
|
|
|
2023
|
|
20,720
|
|
|
Thereafter
|
|
136,430
|
|
|
Total
|
|
$
|
619,444
|
|
|
|
|
|
Payment due by period (in thousands)
|
||||||||||||||||
Consolidated Contractual Obligations
|
|
Total
|
|
Less than 1
year (2019) |
|
1 - 3 years
(2020 - 2021) |
|
3 - 5 years
(2022 - 2023) |
|
More than
5 years (after 2023) |
||||||||||
Long-Term Debt - Principal
|
|
$
|
619,444
|
|
|
$
|
248,199
|
|
|
$
|
112,412
|
|
|
$
|
122,403
|
|
|
$
|
136,430
|
|
Long-Term Debt - Fixed Interest
|
|
60,492
|
|
|
13,131
|
|
|
22,772
|
|
|
12,689
|
|
|
11,900
|
|
|||||
Long-Term Debt - Variable Interest
(1)
|
|
6,633
|
|
|
6,633
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Unsecured Credit Facility - Unused commitment fee
(2)
|
|
98
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating Lease Obligations
|
|
185
|
|
|
85
|
|
|
100
|
|
|
—
|
|
|
—
|
|
|||||
Related Party Rent Lease Obligations
|
|
$
|
963
|
|
|
$
|
441
|
|
|
$
|
522
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total
|
|
$
|
687,815
|
|
|
$
|
268,587
|
|
|
$
|
135,806
|
|
|
$
|
135,092
|
|
|
$
|
148,330
|
|
(1)
|
As of
December 31, 2018
, we had
one
loan totaling
$241.2 million
which bore interest at a floating rate. The variable interest rate payments are based on
LIBOR
plus
1.40%
to
LIBOR
plus
1.95%
, which reflects our new interest rates under our 2014 Facility. 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, 2018
, of
2.35%
.
|
(2)
|
The unused commitment fees on our unsecured credit facility, payable quarterly, are based on the average daily unused amount of our unsecured credit facility. The fees are
0.20%
for facility usage greater than
50%
or
0.25%
for facility usage less than
50%
. The information in the table above reflects our projected obligations for our unsecured credit facility based on our
December 31, 2018
balance of
$441.2 million
.
|
|
|
Common Shares
|
|
Noncontrolling OP Unit Holders
|
|
Total
|
||||||||||||||
Quarter Paid
|
|
Distributions Per Common Share
|
|
Total Amount Paid
|
|
Distributions Per OP Unit
|
|
Total Amount Paid
|
|
Total Amount Paid
|
||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
11,302
|
|
|
$
|
0.2850
|
|
|
$
|
265
|
|
|
$
|
11,567
|
|
Third Quarter
|
|
0.2850
|
|
|
11,294
|
|
|
0.2850
|
|
|
286
|
|
|
11,580
|
|
|||||
Second Quarter
|
|
0.2850
|
|
|
11,203
|
|
|
0.2850
|
|
|
295
|
|
|
11,498
|
|
|||||
First Quarter
|
|
0.2850
|
|
|
11,145
|
|
|
0.2850
|
|
|
309
|
|
|
11,454
|
|
|||||
Total
|
|
$
|
1.1400
|
|
|
$
|
44,944
|
|
|
$
|
1.1400
|
|
|
$
|
1,155
|
|
|
$
|
46,099
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
11,002
|
|
|
$
|
0.2850
|
|
|
$
|
309
|
|
|
$
|
11,311
|
|
Third Quarter
|
|
0.2850
|
|
|
10,948
|
|
|
0.2850
|
|
|
309
|
|
|
11,257
|
|
|||||
Second Quarter
|
|
0.2850
|
|
|
10,093
|
|
|
0.2850
|
|
|
310
|
|
|
10,403
|
|
|||||
First Quarter
|
|
0.2850
|
|
|
8,429
|
|
|
0.2850
|
|
|
313
|
|
|
8,742
|
|
|||||
Total
|
|
$
|
1.1400
|
|
|
$
|
40,472
|
|
|
$
|
1.1400
|
|
|
$
|
1,241
|
|
|
$
|
41,713
|
|
|
|
Year Ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Number of properties owned and operated
|
|
57
|
|
|
59
|
|
||
Aggregate GLA (sq. ft.)
(1)
|
|
4,841,660
|
|
|
5,023,215
|
|
||
Ending occupancy rate - operating portfolio
(1)
|
|
90
|
%
|
|
91
|
%
|
||
Ending occupancy rate
|
|
90
|
%
|
|
90
|
%
|
||
|
|
|
|
|
||||
Number of properties managed
|
|
11
|
|
|
14
|
|
||
Aggregate GLA (sq. ft.)
|
|
1,307,930
|
|
|
1,531,737
|
|
||
Ending occupancy rate - managed operating portfolio
|
|
80
|
%
|
|
81
|
%
|
||
|
|
|
|
|
||||
Total property revenues
|
|
$
|
119,863
|
|
|
$
|
125,959
|
|
Total property expenses
|
|
37,431
|
|
|
42,110
|
|
||
Total other expenses
|
|
64,651
|
|
|
74,430
|
|
||
Provision for income taxes
|
|
347
|
|
|
386
|
|
||
Gain on sale of properties
|
|
(4,629
|
)
|
|
(16
|
)
|
||
Profit sharing expense
|
|
—
|
|
|
278
|
|
||
Loss on disposal of assets
|
|
82
|
|
|
183
|
|
||
Income from continuing operations
|
|
21,981
|
|
|
8,588
|
|
||
Income from discontinued operations
|
|
—
|
|
|
—
|
|
||
Net income
|
|
21,981
|
|
|
8,588
|
|
||
Less: Net income attributable to noncontrolling interests
|
|
550
|
|
|
254
|
|
||
Net income attributable to Whitestone REIT
|
|
$
|
21,431
|
|
|
$
|
8,334
|
|
|
|
|
|
|
||||
Funds from operations
(2)
|
|
$
|
39,398
|
|
|
$
|
35,045
|
|
Funds from operations core
(3)
|
|
48,778
|
|
|
47,096
|
|
||
Property net operating income
(4)
|
|
89,949
|
|
|
83,849
|
|
||
Distributions paid on common shares and OP units
|
|
46,099
|
|
|
41,713
|
|
||
Distributions per common share and OP unit
|
|
$
|
1.1400
|
|
|
$
|
1.1400
|
|
Distributions paid as a percentage of funds from operations core
|
|
95
|
%
|
|
89
|
%
|
(1)
|
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.
|
(2)
|
For an explanation and reconciliation of funds from operations and funds from operations core to net income, see “Funds From Operations” below.
|
(3)
|
For a reconciliation of funds from operations core to net income, see “FFO Core” below.
|
(4)
|
For an explanation and reconciliation of property net operating income to net income, see “Property Net Operating Income” below.
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
Overall Property Expenses
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Real estate taxes
|
|
$
|
16,362
|
|
|
$
|
17,897
|
|
|
$
|
(1,535
|
)
|
|
(9
|
)%
|
Utilities
|
|
4,470
|
|
|
5,514
|
|
|
(1,044
|
)
|
|
(19
|
)%
|
|||
Contract services
|
|
7,017
|
|
|
7,186
|
|
|
(169
|
)
|
|
(2
|
)%
|
|||
Repairs and maintenance
|
|
3,900
|
|
|
5,052
|
|
|
(1,152
|
)
|
|
(23
|
)%
|
|||
Bad debt
|
|
1,391
|
|
|
2,356
|
|
|
(965
|
)
|
|
(41
|
)%
|
|||
Labor and other
|
|
4,291
|
|
|
4,105
|
|
|
186
|
|
|
5
|
%
|
|||
Total
|
|
$
|
37,431
|
|
|
$
|
42,110
|
|
|
$
|
(4,679
|
)
|
|
(11
|
)%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
Same Store Property Expenses
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Real estate taxes
|
|
$
|
13,253
|
|
|
$
|
13,032
|
|
|
$
|
221
|
|
|
2
|
%
|
Utilities
|
|
3,816
|
|
|
3,935
|
|
|
(119
|
)
|
|
(3
|
)%
|
|||
Contract services
|
|
5,602
|
|
|
5,278
|
|
|
324
|
|
|
6
|
%
|
|||
Repairs and maintenance
|
|
3,571
|
|
|
3,830
|
|
|
(259
|
)
|
|
(7
|
)%
|
|||
Bad debt
|
|
1,361
|
|
|
1,867
|
|
|
(506
|
)
|
|
(27
|
)%
|
|||
Labor and other
|
|
3,191
|
|
|
2,891
|
|
|
300
|
|
|
10
|
%
|
|||
Total
|
|
$
|
30,794
|
|
|
$
|
30,833
|
|
|
$
|
(39
|
)
|
|
—
|
%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
Non-Same Store Property Expenses
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Real estate taxes
|
|
$
|
3,109
|
|
|
$
|
2,273
|
|
|
$
|
836
|
|
|
37
|
%
|
Utilities
|
|
654
|
|
|
417
|
|
|
237
|
|
|
57
|
%
|
|||
Contract services
|
|
1,415
|
|
|
764
|
|
|
651
|
|
|
85
|
%
|
|||
Repairs and maintenance
|
|
329
|
|
|
309
|
|
|
20
|
|
|
6
|
%
|
|||
Bad debt
|
|
30
|
|
|
100
|
|
|
(70
|
)
|
|
(70
|
)%
|
|||
Labor and other
|
|
1,100
|
|
|
239
|
|
|
861
|
|
|
360
|
%
|
|||
Total
|
|
$
|
6,637
|
|
|
$
|
4,102
|
|
|
$
|
2,535
|
|
|
62
|
%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Same Store (49 properties excluding development land)
|
|
|
|
|
|
|
|
|
|||||||
Property revenues
|
|
|
|
|
|
|
|
|
|||||||
Rental revenues
|
|
$
|
72,454
|
|
|
$
|
71,987
|
|
|
$
|
467
|
|
|
1
|
%
|
Other revenues
|
|
27,138
|
|
|
24,746
|
|
|
2,392
|
|
|
10
|
%
|
|||
Total property revenues
|
|
99,592
|
|
|
96,733
|
|
|
2,859
|
|
|
3
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Property expenses
|
|
|
|
|
|
|
|
|
|||||||
Property operation and maintenance
|
|
17,541
|
|
|
17,801
|
|
|
(260
|
)
|
|
(1
|
)%
|
|||
Real estate taxes
|
|
13,253
|
|
|
13,032
|
|
|
221
|
|
|
2
|
%
|
|||
Total property expenses
|
|
30,794
|
|
|
30,833
|
|
|
(39
|
)
|
|
—
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total same store net operating income
|
|
68,798
|
|
|
65,900
|
|
|
2,898
|
|
|
4
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Non-Same Store (4 properties excluding development land)
|
|
|
|
|
|
|
|
|
|||||||
Property revenues
|
|
|
|
|
|
|
|
|
|||||||
Rental revenues
|
|
14,190
|
|
|
9,679
|
|
|
4,511
|
|
|
47
|
%
|
|||
Other revenues
|
|
6,081
|
|
|
4,106
|
|
|
1,975
|
|
|
48
|
%
|
|||
Total property revenues
|
|
20,271
|
|
|
13,785
|
|
|
6,486
|
|
|
47
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Property expenses
|
|
|
|
|
|
|
|
|
|||||||
Property operation and maintenance
|
|
3,528
|
|
|
1,829
|
|
|
1,699
|
|
|
93
|
%
|
|||
Real estate taxes
|
|
3,109
|
|
|
2,273
|
|
|
836
|
|
|
37
|
%
|
|||
Total property expenses
|
|
6,637
|
|
|
4,102
|
|
|
2,535
|
|
|
62
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total Non-Same Store net operating income
|
|
13,634
|
|
|
9,683
|
|
|
3,951
|
|
|
41
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Pillarstone OP properties net operating income
|
|
—
|
|
|
8,266
|
|
|
(8,266
|
)
|
|
(100
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Pro rata share of real estate partnership
|
|
7,725
|
|
|
—
|
|
|
7,725
|
|
|
Not meaningful
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total property net operating income
|
|
90,157
|
|
|
83,849
|
|
|
6,308
|
|
|
8
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Less total other expenses, excluding pro rata share of real estate partnership net operating income, provision for income taxes, gain on sale of properties and gain (loss) on disposal of assets
|
|
68,176
|
|
|
75,261
|
|
|
(7,085
|
)
|
|
(9
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Net income
|
|
$
|
21,981
|
|
|
$
|
8,588
|
|
|
$
|
13,393
|
|
|
156
|
%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
General and administrative
|
|
$
|
23,281
|
|
|
$
|
23,949
|
|
|
$
|
(668
|
)
|
|
(3
|
)%
|
Depreciation and amortization
|
|
25,679
|
|
|
27,240
|
|
|
(1,561
|
)
|
|
(6
|
)%
|
|||
Equity in earnings of real estate partnership
|
|
(8,431
|
)
|
|
—
|
|
|
(8,431
|
)
|
|
Not Meaningful
|
|
|||
Interest expense
|
|
25,177
|
|
|
23,651
|
|
|
1,526
|
|
|
6
|
%
|
|||
Interest, dividend and other investment income
|
|
(1,055
|
)
|
|
(410
|
)
|
|
(645
|
)
|
|
157
|
%
|
|||
Total other expenses
|
|
$
|
64,651
|
|
|
$
|
74,430
|
|
|
$
|
(9,779
|
)
|
|
(13
|
)%
|
|
|
Year Ended December 31,
|
||||||
|
|
2017
|
|
2016
|
||||
Number of properties wholly-owned and operated
|
|
59
|
|
|
55
|
|
||
Aggregate GLA (sq. ft.)
(1)
|
|
5,023,215
|
|
|
4,557,425
|
|
||
Ending occupancy rate - wholly-owned operating portfolio
(1)
|
|
91
|
%
|
|
90
|
%
|
||
Ending occupancy rate - all wholly-owned properties
|
|
90
|
%
|
|
89
|
%
|
||
|
|
|
|
|
||||
Number of properties managed
|
|
14
|
|
|
14
|
|
||
Aggregate GLA (sq. ft.)
|
|
1,531,737
|
|
|
1,531,737
|
|
||
Ending occupancy rate - managed operating portfolio
|
|
81
|
%
|
|
81
|
%
|
||
|
|
|
|
|
||||
Total property revenues
|
|
$
|
125,959
|
|
|
$
|
104,437
|
|
Total property expenses
|
|
42,110
|
|
|
34,092
|
|
||
Total other expenses
|
|
74,430
|
|
|
65,189
|
|
||
Provision for income taxes
|
|
386
|
|
|
289
|
|
||
Gain on sale of properties
|
|
(16
|
)
|
|
(3,357
|
)
|
||
Profit sharing expense
|
|
278
|
|
|
15
|
|
||
Loss on disposal of assets
|
|
183
|
|
|
96
|
|
||
Net income
|
|
8,588
|
|
|
8,113
|
|
||
Less: Net income attributable to noncontrolling interests
|
|
254
|
|
|
182
|
|
||
Net income attributable to Whitestone REIT
|
|
$
|
8,334
|
|
|
$
|
7,931
|
|
|
|
|
|
|
||||
Funds from operations
(2)
|
|
$
|
35,045
|
|
|
$
|
27,031
|
|
Funds from operations core
(3)
|
|
47,096
|
|
|
39,379
|
|
||
Property net operating income
(4)
|
|
83,849
|
|
|
70,345
|
|
||
Distributions paid on common shares and OP units
|
|
41,713
|
|
|
32,640
|
|
||
Distributions per common share and OP unit
|
|
$
|
1.1400
|
|
|
$
|
1.1400
|
|
Distributions paid as a percentage of funds from operations core
|
|
89
|
%
|
|
83
|
%
|
(1)
|
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.
|
(2)
|
For an explanation and reconciliation of funds from operations and funds from operations core to net income, see “Funds From Operations” below.
|
(3)
|
For a reconciliation of funds from operations core to net income, see “FFO Core” below.
|
(4)
|
For an explanation and reconciliation of property net operating income to net income, see “Property Net Operating Income” below.
|
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||
Overall Property Expenses
|
|
2017
|
|
2016
|
|
Increase
|
|
% Increase
|
|||||||
Real estate taxes
|
|
$
|
17,897
|
|
|
$
|
14,383
|
|
|
$
|
3,514
|
|
|
24
|
%
|
Utilities
|
|
5,514
|
|
|
4,868
|
|
|
646
|
|
|
13
|
%
|
|||
Contract services
|
|
7,186
|
|
|
5,941
|
|
|
1,245
|
|
|
21
|
%
|
|||
Repairs and maintenance
|
|
5,052
|
|
|
3,802
|
|
|
1,250
|
|
|
33
|
%
|
|||
Bad debt
|
|
2,356
|
|
|
1,589
|
|
|
767
|
|
|
48
|
%
|
|||
Labor and other
|
|
4,105
|
|
|
3,509
|
|
|
596
|
|
|
17
|
%
|
|||
Total
|
|
$
|
42,110
|
|
|
$
|
34,092
|
|
|
$
|
8,018
|
|
|
24
|
%
|
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||
Same Store Property Expenses
|
|
2017
|
|
2016
|
|
Increase
|
|
% Increase
|
|||||||
Real estate taxes
|
|
$
|
12,883
|
|
|
$
|
11,873
|
|
|
$
|
1,010
|
|
|
9
|
%
|
Utilities
|
|
3,738
|
|
|
3,423
|
|
|
315
|
|
|
9
|
%
|
|||
Contract services
|
|
4,988
|
|
|
4,865
|
|
|
123
|
|
|
3
|
%
|
|||
Repairs and maintenance
|
|
3,733
|
|
|
2,921
|
|
|
812
|
|
|
28
|
%
|
|||
Bad debt
|
|
1,742
|
|
|
1,367
|
|
|
375
|
|
|
27
|
%
|
|||
Labor and other
|
|
2,725
|
|
|
2,629
|
|
|
96
|
|
|
4
|
%
|
|||
Total
|
|
$
|
29,809
|
|
|
$
|
27,078
|
|
|
$
|
2,731
|
|
|
10
|
%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
Non-Same Store Property Expenses
|
|
2017
|
|
2016
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Real estate taxes
|
|
$
|
2,422
|
|
|
$
|
190
|
|
|
$
|
2,232
|
|
|
1,175
|
%
|
Utilities
|
|
614
|
|
|
101
|
|
|
513
|
|
|
508
|
%
|
|||
Contract services
|
|
1,054
|
|
|
84
|
|
|
970
|
|
|
1,155
|
%
|
|||
Repairs and maintenance
|
|
406
|
|
|
77
|
|
|
329
|
|
|
427
|
%
|
|||
Bad debt
|
|
225
|
|
|
17
|
|
|
208
|
|
|
1,224
|
%
|
|||
Labor and other
|
|
405
|
|
|
138
|
|
|
267
|
|
|
193
|
%
|
|||
Total
|
|
$
|
5,126
|
|
|
$
|
607
|
|
|
$
|
4,519
|
|
|
744
|
%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Same Store (49 properties excluding development land)
|
|
|
|
|
|
|
|
|
|||||||
Property revenues
|
|
|
|
|
|
|
|
|
|||||||
Rental revenues
|
|
$
|
67,706
|
|
|
$
|
65,340
|
|
|
$
|
2,366
|
|
|
4
|
%
|
Other revenues
|
|
23,456
|
|
|
21,538
|
|
|
1,918
|
|
|
9
|
%
|
|||
Total property revenues
|
|
91,162
|
|
|
86,878
|
|
|
4,284
|
|
|
5
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Property expenses
|
|
|
|
|
|
|
|
|
|||||||
Property operation and maintenance
|
|
16,926
|
|
|
15,205
|
|
|
1,721
|
|
|
11
|
%
|
|||
Real estate taxes
|
|
12,883
|
|
|
11,873
|
|
|
1,010
|
|
|
9
|
%
|
|||
Total property expenses
|
|
29,809
|
|
|
27,078
|
|
|
2,731
|
|
|
10
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total same store net operating income
|
|
61,353
|
|
|
59,800
|
|
|
1,553
|
|
|
3
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Non-Same Store (4 properties excluding development land)
|
|
|
|
|
|
|
|
|
|||||||
Property revenues
|
|
|
|
|
|
|
|
|
|||||||
Rental revenues
|
|
13,960
|
|
|
1,796
|
|
|
12,164
|
|
|
677
|
%
|
|||
Other revenues
|
|
5,396
|
|
|
503
|
|
|
4,893
|
|
|
973
|
%
|
|||
Total property revenues
|
|
19,356
|
|
|
2,299
|
|
|
17,057
|
|
|
742
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Property expenses
|
|
|
|
|
|
|
|
|
|||||||
Property operation and maintenance
|
|
2,704
|
|
|
417
|
|
|
2,287
|
|
|
548
|
%
|
|||
Real estate taxes
|
|
2,422
|
|
|
190
|
|
|
2,232
|
|
|
1,175
|
%
|
|||
Total property expenses
|
|
5,126
|
|
|
607
|
|
|
4,519
|
|
|
744
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total Non-Same Store net operating income
|
|
14,230
|
|
|
1,692
|
|
|
12,538
|
|
|
741
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Pillarstone OP properties (14 properties)
|
|
|
|
|
|
|
|
|
|||||||
Property revenues
|
|
|
|
|
|
|
|
|
|||||||
Rental revenues
|
|
12,902
|
|
|
12,932
|
|
|
(30
|
)
|
|
0
|
%
|
|||
Other revenues
|
|
2,539
|
|
|
2,328
|
|
|
211
|
|
|
9
|
%
|
|||
Total property revenues
|
|
15,441
|
|
|
15,260
|
|
|
181
|
|
|
1
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Property expenses
|
|
|
|
|
|
|
|
|
|||||||
Property operation and maintenance
|
|
4,583
|
|
|
4,087
|
|
|
496
|
|
|
12
|
%
|
|||
Real estate taxes
|
|
2,592
|
|
|
2,320
|
|
|
272
|
|
|
12
|
%
|
|||
Total property expenses
|
|
7,175
|
|
|
6,407
|
|
|
768
|
|
|
12
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total Pillarstone OP properties net operating income
|
|
8,266
|
|
|
8,853
|
|
|
(587
|
)
|
|
(7
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total property net operating income
|
|
83,849
|
|
|
70,345
|
|
|
13,504
|
|
|
19
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Less total other expenses, provision for income taxes and loss on disposal of assets
|
|
75,261
|
|
|
62,232
|
|
|
13,029
|
|
|
21
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Net income
|
|
$
|
8,588
|
|
|
$
|
8,113
|
|
|
$
|
475
|
|
|
6
|
%
|
|
|
Year Ended December 31,
|
|
Increase
|
|
% Increase
|
|||||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
General and administrative
|
|
$
|
23,949
|
|
|
$
|
23,922
|
|
|
$
|
27
|
|
|
—
|
%
|
Depreciation and amortization
|
|
27,240
|
|
|
22,457
|
|
|
4,783
|
|
|
21
|
%
|
|||
Interest expense
|
|
23,651
|
|
|
19,239
|
|
|
4,412
|
|
|
23
|
%
|
|||
Interest, dividend and other investment income
|
|
(410
|
)
|
|
(429
|
)
|
|
19
|
|
|
(4
|
)%
|
|||
Total other expenses
|
|
$
|
74,430
|
|
|
$
|
65,189
|
|
|
$
|
9,241
|
|
|
14
|
%
|
|
|
Three Months Ended March 31,
|
|||||||||||||
|
|
2018 (as Restated)
|
|
2017
|
|
Change
|
|
Change %
|
|||||||
Number of properties owned and operated
|
|
58
|
|
|
55
|
|
|
3
|
|
|
5
|
%
|
|||
Aggregate GLA (sq. ft.)
(1)
|
|
4,949,285
|
|
|
4,584,488
|
|
|
364,797
|
|
|
8
|
%
|
|||
Ending occupancy rate - operating portfolio
(1)
|
|
91
|
%
|
|
89
|
%
|
|
2
|
%
|
|
2
|
%
|
|||
Ending occupancy rate
|
|
91
|
%
|
|
88
|
%
|
|
3
|
%
|
|
3
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Number of properties managed
|
|
14
|
|
|
14
|
|
|
—
|
|
|
—
|
%
|
|||
Aggregate GLA (sq. ft.)
|
|
1,531,737
|
|
|
1,531,737
|
|
|
—
|
|
|
—
|
%
|
|||
Ending occupancy rate - managed operating portfolio
|
|
78
|
%
|
|
80
|
%
|
|
(2
|
)%
|
|
(3
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total property revenues
|
|
$
|
29,785
|
|
|
$
|
28,267
|
|
|
$
|
1,518
|
|
|
5
|
%
|
Total property expenses
|
|
8,832
|
|
|
9,414
|
|
|
(582
|
)
|
|
(6
|
)%
|
|||
Total other expenses
|
|
17,643
|
|
|
17,192
|
|
|
451
|
|
|
3
|
%
|
|||
Provision for income taxes
|
|
110
|
|
|
81
|
|
|
29
|
|
|
36
|
%
|
|||
Gain on sale of properties
|
|
(249
|
)
|
|
—
|
|
|
(249
|
)
|
|
Not meaningful
|
|
|||
Profit sharing expense
|
|
—
|
|
|
64
|
|
|
(64
|
)
|
|
(100
|
)%
|
|||
Loss on disposal of assets
|
|
180
|
|
|
23
|
|
|
157
|
|
|
683
|
%
|
|||
Net income
|
|
3,269
|
|
|
1,493
|
|
|
1,776
|
|
|
119
|
%
|
|||
Less: Net income attributable to noncontrolling interests
|
|
88
|
|
|
53
|
|
|
35
|
|
|
66
|
%
|
|||
Net income attributable to Whitestone REIT
|
|
$
|
3,181
|
|
|
$
|
1,440
|
|
|
$
|
1,741
|
|
|
121
|
%
|
|
|
|
|
|
|
|
|
|
(1)
|
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.
|
|
|
Three Months Ended June 30,
|
|||||||||||||
|
|
2018 (as Restated)
|
|
2017
|
|
Change
|
|
Change %
|
|||||||
Number of properties owned and operated
|
|
58
|
|
|
58
|
|
|
—
|
|
|
—
|
%
|
|||
Aggregate GLA (sq. ft.)
(1)
|
|
4,949,285
|
|
|
5,023,009
|
|
|
(73,724
|
)
|
|
(1
|
)%
|
|||
Ending occupancy rate - operating portfolio
(1)
|
|
91
|
%
|
|
90
|
%
|
|
1
|
%
|
|
1
|
%
|
|||
Ending occupancy rate
|
|
91
|
%
|
|
89
|
%
|
|
2
|
%
|
|
2
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Number of properties managed
|
|
14
|
|
|
14
|
|
|
—
|
|
|
—
|
%
|
|||
Aggregate GLA (sq. ft.)
|
|
1,529,861
|
|
|
1,531,737
|
|
|
(1,876
|
)
|
|
—
|
%
|
|||
Ending occupancy rate - managed operating portfolio
|
|
77
|
%
|
|
78
|
%
|
|
(1
|
)%
|
|
(1
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total property revenues
|
|
$
|
29,473
|
|
|
$
|
30,208
|
|
|
$
|
(735
|
)
|
|
(2
|
)%
|
Total property expenses
|
|
8,922
|
|
|
9,862
|
|
|
(940
|
)
|
|
(10
|
)%
|
|||
Total other expenses
|
|
18,414
|
|
|
18,057
|
|
|
357
|
|
|
2
|
%
|
|||
Provision for income taxes
|
|
59
|
|
|
89
|
|
|
(30
|
)
|
|
(34
|
)%
|
|||
Gain on sale of properties
|
|
—
|
|
|
(16
|
)
|
|
16
|
|
|
(100
|
)%
|
|||
Profit sharing expense
|
|
—
|
|
|
101
|
|
|
(101
|
)
|
|
(100
|
)%
|
|||
Loss on disposal of assets
|
|
73
|
|
|
72
|
|
|
1
|
|
|
1
|
%
|
|||
Net income
|
|
2,005
|
|
|
2,043
|
|
|
(38
|
)
|
|
(2
|
)%
|
|||
Less: Net income attributable to noncontrolling interests
|
|
51
|
|
|
60
|
|
|
(9
|
)
|
|
(15
|
)%
|
|||
Net income attributable to Whitestone REIT
|
|
$
|
1,954
|
|
|
$
|
1,983
|
|
|
$
|
(29
|
)
|
|
(1
|
)%
|
|
|
|
|
|
|
|
|
|
(1)
|
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.
|
|
|
Three Months Ended September 30,
|
|||||||||||||
|
|
2018 (as Restated)
|
|
2017
|
|
Change
|
|
Change %
|
|||||||
Number of properties owned and operated
|
|
57
|
|
|
58
|
|
|
(1
|
)
|
|
(2
|
)%
|
|||
Aggregate GLA (sq. ft.)
(1)
|
|
4,843,519
|
|
|
5,023,215
|
|
|
(179,696
|
)
|
|
(4
|
)%
|
|||
Ending occupancy rate - operating portfolio
(1)
|
|
92
|
%
|
|
90
|
%
|
|
2
|
%
|
|
2
|
%
|
|||
Ending occupancy rate
|
|
92
|
%
|
|
90
|
%
|
|
2
|
%
|
|
2
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Number of properties managed
|
|
14
|
|
|
14
|
|
|
—
|
|
|
—
|
%
|
|||
Aggregate GLA (sq. ft.)
|
|
1,529,861
|
|
|
1,531,737
|
|
|
(1,876
|
)
|
|
—
|
%
|
|||
Ending occupancy rate - managed operating portfolio
|
|
80
|
%
|
|
80
|
%
|
|
—
|
%
|
|
—
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Total property revenues
|
|
$
|
30,704
|
|
|
$
|
33,653
|
|
|
$
|
(2,949
|
)
|
|
(9
|
)%
|
Total property expenses
|
|
9,831
|
|
|
11,285
|
|
|
(1,454
|
)
|
|
(13
|
)%
|
|||
Total other expenses
|
|
17,125
|
|
|
19,062
|
|
|
(1,937
|
)
|
|
(10
|
)%
|
|||
Provision for income taxes
|
|
92
|
|
|
126
|
|
|
(34
|
)
|
|
(27
|
)%
|
|||
Gain on sale of properties
|
|
(4,380
|
)
|
|
—
|
|
|
(4,380
|
)
|
|
Not meaningful
|
|
|||
Profit sharing expense
|
|
—
|
|
|
63
|
|
|
(63
|
)
|
|
(100
|
)%
|
|||
Loss on disposal of assets
|
|
3
|
|
|
40
|
|
|
(37
|
)
|
|
(93
|
)%
|
|||
Net income
|
|
8,033
|
|
|
3,077
|
|
|
4,956
|
|
|
161
|
%
|
|||
Less: Net income attributable to noncontrolling interests
|
|
198
|
|
|
84
|
|
|
114
|
|
|
136
|
%
|
|||
Net income attributable to Whitestone REIT
|
|
$
|
7,835
|
|
|
$
|
2,993
|
|
|
$
|
4,842
|
|
|
162
|
%
|
|
|
|
|
|
|
|
|
|
(1)
|
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.
|
|
|
Year Ended December 31,
|
||||||||||
FFO AND FFO CORE
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income attributable to Whitestone REIT
|
|
$
|
21,431
|
|
|
$
|
8,334
|
|
|
$
|
7,931
|
|
Adjustments to reconcile to FFO:
(1)
|
|
|
|
|
|
|
||||||
Depreciation and amortization of real estate assets
|
|
25,401
|
|
|
26,290
|
|
|
22,179
|
|
|||
Depreciation and amortization of real estate assets of real estate partnership (pro rata)
(2)
|
|
2,903
|
|
|
—
|
|
|
—
|
|
|||
(Gain) loss on sale or disposal of assets and properties, net
|
|
(4,547
|
)
|
|
167
|
|
|
(3,261
|
)
|
|||
Gain on sale or disposal of properties or assets of real estate partnership (pro rata)
(2)
|
|
(6,340
|
)
|
|
—
|
|
|
—
|
|
|||
Net income attributable to noncontrolling interests
|
|
550
|
|
|
254
|
|
|
182
|
|
|||
FFO
|
|
$
|
39,398
|
|
|
$
|
35,045
|
|
|
$
|
27,031
|
|
|
|
|
|
|
|
|
||||||
Share-based compensation expense
|
|
$
|
6,758
|
|
|
$
|
10,426
|
|
|
$
|
10,247
|
|
Proxy contest professional fees
|
|
2,534
|
|
|
—
|
|
|
—
|
|
|||
Early debt extinguishment costs of real estate partnership
|
|
88
|
|
|
—
|
|
|
—
|
|
|||
Acquisition costs
|
|
—
|
|
|
1,625
|
|
|
2,101
|
|
|||
FFO Core
|
|
$
|
48,778
|
|
|
$
|
47,096
|
|
|
$
|
39,379
|
|
(1)
|
Includes pro-rata share attributable to real estate partnership.
|
(2)
|
Included in equity in earnings of real estate partnership on the consolidated statements of operations and comprehensive income.
|
|
|
Year Ended December 31,
|
||||||||||
PROPERTY NET OPERATING INCOME (“NOI”)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income attributable to Whitestone REIT
|
|
$
|
21,431
|
|
|
$
|
8,334
|
|
|
$
|
7,931
|
|
General and administrative expenses
|
|
23,281
|
|
|
23,949
|
|
|
23,922
|
|
|||
Depreciation and amortization
|
|
25,679
|
|
|
27,240
|
|
|
22,457
|
|
|||
Equity in earnings of real estate partnership
|
|
(8,431
|
)
|
|
—
|
|
|
—
|
|
|||
Interest expense
|
|
25,177
|
|
|
23,651
|
|
|
19,239
|
|
|||
Interest, dividend and other investment income
|
|
(1,055
|
)
|
|
(410
|
)
|
|
(429
|
)
|
|||
Provision for income taxes
|
|
347
|
|
|
386
|
|
|
289
|
|
|||
Gain on sale of properties
|
|
(4,629
|
)
|
|
(16
|
)
|
|
(3,357
|
)
|
|||
Management fee, net of related expenses
|
|
(208
|
)
|
|
—
|
|
|
—
|
|
|||
Profit sharing expense
|
|
—
|
|
|
278
|
|
|
15
|
|
|||
Loss on sale or disposal of assets
|
|
82
|
|
|
183
|
|
|
96
|
|
|||
NOI of real estate partnership (pro rata)
|
|
7,725
|
|
|
—
|
|
|
—
|
|
|||
Net income attributable to noncontrolling interests
|
|
550
|
|
|
254
|
|
|
182
|
|
|||
NOI
|
|
$
|
89,949
|
|
|
$
|
83,849
|
|
|
$
|
70,345
|
|
•
|
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and dispositions of our assets;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.
|
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
|
)
|
$
|
—
|
|
|
3,172,158
|
|
(2)
|
|
|
|
|
|
|
|
|
|||||
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
(3)
|
||
|
|
|
|
|
|
|
|
|||||
Total
|
|
—
|
|
|
$
|
—
|
|
|
3,172,158
|
|
|
(1)
|
Excludes 3,119,221 common shares subject to outstanding restricted common share units granted pursuant to our 2008 Long-Term Equity Incentive Ownership Plan, as amended (the “2008 Plan”).
|
(2)
|
At our annual meeting of shareholders on May 11, 2017, our shareholders voted to approve the 2018 Long-Term Equity Incentive Ownership Plan (the “2018 Plan”). The 2018 Plan provides for the issuance of up to 3,433,831 common shares and OP units pursuant to awards under the 2018 Plan. The 2018 Plan became effective on July 30, 2018, which is the day after the 2008 Plan expired. Pursuant to the 2008 Plan, the maximum aggregate number of common shares that were issuable under the 2008 Plan was increased upon each issuance of common shares by the Company so that at any time the maximum number of shares that were issuable under the 2008 Plan equaled 12.5% of the aggregate number of 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 common shares issued to trustees outside the 2008 Plan.
|
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.
|
Exhibit No.
|
Description
|
Exhibit No.
|
Description
|
Exhibit No.
|
Description
|
Exhibit No.
|
Description
|
Exhibit No.
|
Description
|
Exhibit No.
|
Description
|
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
|
|
|
|
|
WHITESTONE REIT
|
Date:
|
March 15, 2019
|
By:
|
|
/s/ James C. Mastandrea
|
|
|
|
|
James C. Mastandrea, Chairman and CEO
|
March 15, 2019
|
/s/ James C. Mastandrea
|
|
|
James C. Mastandrea, Chairman and CEO
|
|
|
(Principal Executive Officer)
|
|
|
|
|
March 15, 2019
|
/s/ David K. Holeman
|
|
|
David K. Holeman, Chief Financial Officer
|
|
|
(Principal Financial and Principal Accounting Officer)
|
|
|
|
|
March 15, 2019
|
/s/ Nandita Berry
|
|
|
Nandita Berry, Trustee
|
|
|
|
|
March 15, 2019
|
/s/ Donald F. Keating
|
|
|
Donald F. Keating, Trustee
|
|
|
|
|
March 15, 2019
|
/s/ Najeeb A. Khan
|
|
|
Najeeb A. Khan, Trustee
|
|
|
|
|
March 15, 2019
|
/s/ Paul T. Lambert
|
|
|
Paul T. Lambert, Trustee
|
|
|
|
|
March 15, 2019
|
/s/ Jack L. Mahaffey
|
|
|
Jack L. Mahaffey, Trustee
|
|
|
|
|
March 15, 2019
|
/s/ David F. Taylor
|
|
|
David F. Taylor, Trustee
|
|
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
|
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Page
|
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Whitestone REIT and Subsidiaries
|
||||||||
CONSOLIDATED BALANCE SHEETS
|
||||||||
(in thousands, except per share data)
|
||||||||
|
|
|
||||||
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
ASSETS
|
||||||||
Real estate assets, at cost
|
|
|
|
|
||||
Property
|
|
$
|
1,052,238
|
|
|
$
|
1,149,454
|
|
Accumulated depreciation
|
|
(113,300
|
)
|
|
(131,034
|
)
|
||
Total real estate assets
|
|
938,938
|
|
|
1,018,420
|
|
||
Investment in real estate partnership
|
|
26,236
|
|
|
4,095
|
|
||
Cash and cash equivalents
|
|
13,658
|
|
|
5,005
|
|
||
Restricted cash
|
|
128
|
|
|
205
|
|
||
Marketable securities
|
|
—
|
|
|
32
|
|
||
Escrows and acquisition deposits
|
|
8,211
|
|
|
7,916
|
|
||
Accrued rents and accounts receivable, net of allowance for doubtful accounts
|
|
21,642
|
|
|
21,140
|
|
||
Receivable due from related party
|
|
394
|
|
|
—
|
|
||
Financed receivable due from related party
|
|
5,661
|
|
|
—
|
|
||
Unamortized lease commissions and loan costs
|
|
6,698
|
|
|
7,157
|
|
||
Prepaid expenses and other assets
|
|
7,306
|
|
|
6,198
|
|
||
Total assets
|
|
$
|
1,028,872
|
|
|
$
|
1,070,168
|
|
LIABILITIES AND EQUITY
|
||||||||
Liabilities:
|
|
|
|
|
||||
Notes payable
|
|
$
|
618,205
|
|
|
$
|
659,068
|
|
Accounts payable and accrued expenses
|
|
33,729
|
|
|
35,536
|
|
||
Payable due to related party
|
|
58
|
|
|
—
|
|
||
Tenants' security deposits
|
|
6,130
|
|
|
5,694
|
|
||
Dividends and distributions payable
|
|
11,600
|
|
|
11,466
|
|
||
Total liabilities
|
|
669,722
|
|
|
711,764
|
|
||
Commitments and contingencies:
|
|
—
|
|
|
—
|
|
||
Equity:
|
|
|
|
|
||||
Preferred shares, $0.001 par value per share; 50,000,000 shares authorized; none issued and outstanding as of December 31, 2018 and December 31, 2017, respectively
|
|
—
|
|
|
—
|
|
||
Common shares, $0.001 par value per share; 400,000,000 shares authorized; 39,778,029 and 39,221,773 issued and outstanding as of December 31, 2018 and December 31, 2017, respectively
|
|
39
|
|
|
38
|
|
||
Additional paid-in capital
|
|
527,662
|
|
|
521,314
|
|
||
Accumulated deficit
|
|
(181,361
|
)
|
|
(176,684
|
)
|
||
Accumulated other comprehensive gain
|
|
4,116
|
|
|
2,936
|
|
||
Total Whitestone REIT shareholders' equity
|
|
350,456
|
|
|
347,604
|
|
||
Noncontrolling interest in subsidiary
|
|
8,694
|
|
|
10,800
|
|
||
Total equity
|
|
359,150
|
|
|
358,404
|
|
||
Total liabilities and equity
|
|
$
|
1,028,872
|
|
|
$
|
1,070,168
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
|
||||||
Property revenues
|
|
|
|
|
|
|
||||||
Rental revenues
|
|
$
|
86,644
|
|
|
$
|
94,568
|
|
|
$
|
80,068
|
|
Other revenues
|
|
33,219
|
|
|
31,391
|
|
|
24,369
|
|
|||
Total property revenues
|
|
119,863
|
|
|
125,959
|
|
|
104,437
|
|
|||
|
|
|
|
|
|
|
||||||
Property expenses
|
|
|
|
|
|
|
|
|
|
|||
Property operation and maintenance
|
|
21,069
|
|
|
24,213
|
|
|
19,709
|
|
|||
Real estate taxes
|
|
16,362
|
|
|
17,897
|
|
|
14,383
|
|
|||
Total property expenses
|
|
37,431
|
|
|
42,110
|
|
|
34,092
|
|
|||
|
|
|
|
|
|
|
||||||
Other expenses (income)
|
|
|
|
|
|
|
|
|
|
|||
General and administrative
|
|
23,281
|
|
|
23,949
|
|
|
23,922
|
|
|||
Depreciation and amortization
|
|
25,679
|
|
|
27,240
|
|
|
22,457
|
|
|||
Equity in earnings of real estate partnership
|
|
(8,431
|
)
|
|
—
|
|
|
—
|
|
|||
Interest expense
|
|
25,177
|
|
|
23,651
|
|
|
19,239
|
|
|||
Interest, dividend and other investment income
|
|
(1,055
|
)
|
|
(410
|
)
|
|
(429
|
)
|
|||
Total other expense
|
|
64,651
|
|
|
74,430
|
|
|
65,189
|
|
|||
|
|
|
|
|
|
|
||||||
Income before gain (loss) on sale or disposal of properties or assets, income taxes, and profit sharing expense
|
|
17,781
|
|
|
9,419
|
|
|
5,156
|
|
|||
|
|
|
|
|
|
|
||||||
Provision for income taxes
|
|
(347
|
)
|
|
(386
|
)
|
|
(289
|
)
|
|||
Gain on sale of properties
|
|
4,629
|
|
|
16
|
|
|
3,357
|
|
|||
Profit sharing expense
|
|
—
|
|
|
(278
|
)
|
|
(15
|
)
|
|||
Loss on sale or disposal of assets
|
|
(82
|
)
|
|
(183
|
)
|
|
(96
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net income
|
|
21,981
|
|
|
8,588
|
|
|
8,113
|
|
|||
|
|
|
|
|
|
|
||||||
Less: Net income attributable to noncontrolling interests
|
|
550
|
|
|
254
|
|
|
182
|
|
|||
|
|
|
|
|
|
|
||||||
Net income attributable to Whitestone REIT
|
|
$
|
21,431
|
|
|
$
|
8,334
|
|
|
$
|
7,931
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
|
||||||
Basic Earnings Per Share:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.54
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
Diluted Earnings Per Share:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.52
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
|
|
|
|
|
|
|
||||||
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
39,274
|
|
|
35,428
|
|
|
27,618
|
|
|||
Diluted
|
|
40,612
|
|
|
36,255
|
|
|
28,383
|
|
|||
|
|
|
|
|
|
|
||||||
Distributions declared per common share / OP unit
|
|
$
|
1.1400
|
|
|
$
|
1.1400
|
|
|
$
|
1.1400
|
|
|
|
|
|
|
|
|
||||||
Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
21,981
|
|
|
$
|
8,588
|
|
|
$
|
8,113
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive gain
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
Unrealized gain on cash flow hedging activities
|
|
1,192
|
|
|
2,022
|
|
|
929
|
|
|||
Unrealized gain on available-for-sale marketable securities
|
|
18
|
|
|
118
|
|
|
82
|
|
|||
|
|
|
|
|
|
|
||||||
Comprehensive income
|
|
23,191
|
|
|
10,728
|
|
|
9,124
|
|
|||
|
|
|
|
|
|
|
||||||
Less: Net income attributable to noncontrolling interests
|
|
550
|
|
|
254
|
|
|
182
|
|
|||
Less: Comprehensive gain attributable to noncontrolling interests
|
|
30
|
|
|
63
|
|
|
23
|
|
|||
|
|
|
|
|
|
|
||||||
Comprehensive income attributable to Whitestone REIT
|
|
$
|
22,611
|
|
|
$
|
10,411
|
|
|
$
|
8,919
|
|
Whitestone REIT and Subsidiaries
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in thousands, except per share and unit data)
|
||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
Additional
|
|
|
|
Other
|
|
Total
|
|
Noncontrolling
|
|
|
||||||||||||||||||||
|
|
Common Shares
|
|
Paid-in
|
|
Accumulated
|
|
Comprehensive
|
|
Shareholders’
|
|
Interests
|
|
Total
|
||||||||||||||||||||
|
|
Shares
|
|
Amount
|
|
Capital
|
|
Deficit
|
|
Gain (Loss)
|
|
Equity
|
|
Units
|
|
Dollars
|
|
Equity
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, December 31, 2015
|
|
26,991
|
|
|
$
|
27
|
|
|
$
|
359,971
|
|
|
$
|
(116,895
|
)
|
|
$
|
(129
|
)
|
|
$
|
242,974
|
|
|
497
|
|
|
$
|
4,017
|
|
|
$
|
246,991
|
|
Exchange of noncontrolling interest OP units for common shares
|
|
15
|
|
|
—
|
|
|
125
|
|
|
—
|
|
|
—
|
|
|
125
|
|
|
(15
|
)
|
|
(125
|
)
|
|
—
|
|
|||||||
Issuance of common shares under dividend reinvestment plan
|
|
9
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
114
|
|
|||||||
Issuance of common shares, net of offering costs
|
|
2,064
|
|
|
2
|
|
|
30,012
|
|
|
—
|
|
|
—
|
|
|
30,014
|
|
|
—
|
|
|
—
|
|
|
30,014
|
|
|||||||
Issuance of OP units
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
621
|
|
|
8,738
|
|
|
8,738
|
|
|||||||
Repurchase of common shares
(2)
|
|
(282
|
)
|
|
—
|
|
|
(3,948
|
)
|
|
—
|
|
|
—
|
|
|
(3,948
|
)
|
|
—
|
|
|
—
|
|
|
(3,948
|
)
|
|||||||
Shared-based compensation
|
|
671
|
|
|
—
|
|
|
10,231
|
|
|
—
|
|
|
—
|
|
|
10,231
|
|
|
—
|
|
|
—
|
|
|
10,231
|
|
|||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32,731
|
)
|
|
—
|
|
|
(32,731
|
)
|
|
—
|
|
|
(905
|
)
|
|
(33,636
|
)
|
|||||||
Unrealized gain on change in fair value of cash flow hedge
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
908
|
|
|
908
|
|
|
—
|
|
|
21
|
|
|
929
|
|
|||||||
Unrealized loss on change in fair value of available-for sale marketable securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|
80
|
|
|
—
|
|
|
2
|
|
|
82
|
|
|||||||
Reallocation of ownership percentage between parent and subsidiary
|
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
11
|
|
|
—
|
|
|||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,931
|
|
|
—
|
|
|
7,931
|
|
|
—
|
|
|
182
|
|
|
8,113
|
|
|||||||
Balance, December 31, 2016
|
|
29,468
|
|
|
29
|
|
|
396,494
|
|
|
(141,695
|
)
|
|
859
|
|
|
255,687
|
|
|
1,103
|
|
|
11,941
|
|
|
267,628
|
|
|||||||
Exchange of noncontrolling interest OP units for common shares
|
|
19
|
|
|
—
|
|
|
206
|
|
|
—
|
|
|
—
|
|
|
206
|
|
|
(19
|
)
|
|
(206
|
)
|
|
—
|
|
|||||||
Issuance of common shares under dividend reinvestment plan
|
|
9
|
|
|
—
|
|
|
127
|
|
|
—
|
|
|
—
|
|
|
127
|
|
|
—
|
|
|
—
|
|
|
127
|
|
|||||||
Issuance of common shares, net of offering costs
|
|
1,324
|
|
|
1
|
|
|
18,516
|
|
|
—
|
|
|
—
|
|
|
18,517
|
|
|
—
|
|
|
—
|
|
|
18,517
|
|
|||||||
Issuance of OP units
|
|
8,019
|
|
|
8
|
|
|
99,887
|
|
|
—
|
|
|
—
|
|
|
99,895
|
|
|
—
|
|
|
—
|
|
|
99,895
|
|
|||||||
Repurchase of common shares
(2)
|
|
(324
|
)
|
|
—
|
|
|
(4,339
|
)
|
|
—
|
|
|
—
|
|
|
(4,339
|
)
|
|
—
|
|
|
—
|
|
|
(4,339
|
)
|
|||||||
Share-based compensation
|
|
707
|
|
|
—
|
|
|
10,410
|
|
|
—
|
|
|
—
|
|
|
10,410
|
|
|
—
|
|
|
—
|
|
|
10,410
|
|
|||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(43,323
|
)
|
|
—
|
|
|
(43,323
|
)
|
|
—
|
|
|
(1,239
|
)
|
|
(44,562
|
)
|
|||||||
Unrealized gain on change in fair value of cash flow hedge
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,962
|
|
|
1,962
|
|
|
—
|
|
|
60
|
|
|
2,022
|
|
|||||||
Unrealized gain on change in fair value of available-for sale marketable securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
115
|
|
|
115
|
|
|
—
|
|
|
3
|
|
|
118
|
|
|||||||
Reallocation of ownership percentage between parent and subsidiary
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
|||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,334
|
|
|
—
|
|
|
8,334
|
|
|
—
|
|
|
254
|
|
|
8,588
|
|
|||||||
Balance, December 31, 2017
|
|
39,222
|
|
|
38
|
|
|
521,314
|
|
|
(176,684
|
)
|
|
2,936
|
|
|
347,604
|
|
|
1,084
|
|
|
10,800
|
|
|
358,404
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
See the accompanying notes to consolidated financial statements.
|
||||||||||||||||||||||||||||||||||
Impact of change in accounting principal:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
ASU 2014-09
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,119
|
|
|
—
|
|
|
19,119
|
|
|
—
|
|
|
—
|
|
|
19,119
|
|
|||||||
Balance January 1, 2018
|
|
39,222
|
|
|
38
|
|
|
521,314
|
|
|
(157,565
|
)
|
|
2,936
|
|
|
366,723
|
|
|
1,084
|
|
|
10,800
|
|
|
377,523
|
|
|||||||
Exchange of noncontrolling interest OP units for common shares
|
|
155
|
|
|
1
|
|
|
1,545
|
|
|
—
|
|
|
—
|
|
|
1,546
|
|
|
(155
|
)
|
|
(1,546
|
)
|
|
—
|
|
|||||||
Issuance of common shares under dividend reinvestment plan
|
|
10
|
|
|
—
|
|
|
133
|
|
|
—
|
|
|
—
|
|
|
133
|
|
|
—
|
|
|
—
|
|
|
133
|
|
|||||||
Exchange offer costs
|
|
—
|
|
|
—
|
|
|
(126
|
)
|
|
—
|
|
|
—
|
|
|
(126
|
)
|
|
—
|
|
|
—
|
|
|
(126
|
)
|
|||||||
Repurchase of common shares
(2)
|
|
(160
|
)
|
|
—
|
|
|
(1,961
|
)
|
|
—
|
|
|
—
|
|
|
(1,961
|
)
|
|
—
|
|
|
—
|
|
|
(1,961
|
)
|
|||||||
Share-based compensation
|
|
551
|
|
|
—
|
|
|
6,742
|
|
|
—
|
|
|
—
|
|
|
6,742
|
|
|
—
|
|
|
—
|
|
|
6,742
|
|
|||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(45,227
|
)
|
|
—
|
|
|
(45,227
|
)
|
|
—
|
|
|
(1,125
|
)
|
|
(46,352
|
)
|
|||||||
Unrealized gain on change in fair value of cash flow hedge
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,162
|
|
|
1,162
|
|
|
—
|
|
|
30
|
|
|
1,192
|
|
|||||||
Unrealized gain on change in fair value of available-for sale marketable securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||||
Reallocation of ownership percentage between parent and subsidiary
|
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,431
|
|
|
—
|
|
|
21,431
|
|
|
—
|
|
|
550
|
|
|
21,981
|
|
|||||||
Balance, December 31, 2018
|
|
39,778
|
|
|
$
|
39
|
|
|
$
|
527,662
|
|
|
$
|
(181,361
|
)
|
|
$
|
4,116
|
|
|
$
|
350,456
|
|
|
929
|
|
|
$
|
8,694
|
|
|
$
|
359,150
|
|
(1)
|
Represents the impact of change in accounting principal for our modified retrospective adoption of ASU 2014-09. See Note 2 of the notes to the consolidated financial statements for additional disclosure.
|
(2)
|
During the years ended December 31, 2018, 2017 and 2016, the Company acquired common shares held by employees who tendered owned common shares to satisfy the tax withholding on the lapse of certain restrictions on restricted shares.
|
Whitestone REIT and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) |
||||||||||||
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
21,981
|
|
|
$
|
8,588
|
|
|
$
|
8,113
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
|
25,679
|
|
|
27,240
|
|
|
22,457
|
|
|||
Amortization of deferred loan costs
|
|
1,092
|
|
|
1,283
|
|
|
1,554
|
|
|||
Amortization of notes payable discount
|
|
—
|
|
|
508
|
|
|
391
|
|
|||
Loss on sale of marketable securities
|
|
20
|
|
|
91
|
|
|
—
|
|
|||
Loss (gain) on sale or disposal of assets and properties
|
|
(4,547
|
)
|
|
167
|
|
|
(3,261
|
)
|
|||
Bad debt expense
|
|
1,391
|
|
|
2,340
|
|
|
1,585
|
|
|||
Share-based compensation
|
|
6,741
|
|
|
10,410
|
|
|
10,231
|
|
|||
Equity in earnings of real estate partnership
|
|
(8,431
|
)
|
|
—
|
|
|
—
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Escrows and acquisition deposits
|
|
(295
|
)
|
|
(3,570
|
)
|
|
2,322
|
|
|||
Accrued rent and accounts receivable
|
|
(1,893
|
)
|
|
(5,430
|
)
|
|
(3,630
|
)
|
|||
Receivable due from related party
|
|
610
|
|
|
—
|
|
|
—
|
|
|||
Distributions from real estate partnership
|
|
1,324
|
|
|
—
|
|
|
—
|
|
|||
Unamortized lease commissions
|
|
(1,676
|
)
|
|
(2,299
|
)
|
|
(1,474
|
)
|
|||
Prepaid expenses and other assets
|
|
1,175
|
|
|
168
|
|
|
1,396
|
|
|||
Accounts payable and accrued expenses
|
|
(2,429
|
)
|
|
1,337
|
|
|
1,089
|
|
|||
Payable due to related party
|
|
(1,621
|
)
|
|
—
|
|
|
—
|
|
|||
Tenants' security deposits
|
|
436
|
|
|
565
|
|
|
(125
|
)
|
|||
Net cash provided by operating activities
|
|
39,557
|
|
|
41,398
|
|
|
40,648
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Acquisitions of real estate
|
|
—
|
|
|
(125,468
|
)
|
|
(60,616
|
)
|
|||
Additions to real estate
|
|
(11,638
|
)
|
|
(17,575
|
)
|
|
(22,036
|
)
|
|||
Proceeds from sales of properties
|
|
12,574
|
|
|
26
|
|
|
6,897
|
|
|||
Proceeds from financed receivable due from related party
|
|
9,812
|
|
|
—
|
|
|
—
|
|
|||
Investment in real estate partnership
|
|
—
|
|
|
(2,394
|
)
|
|
(2,704
|
)
|
|||
Proceeds from sales of marketable securities
|
|
30
|
|
|
513
|
|
|
—
|
|
|||
Net cash provided by (used in) investing activities
|
|
10,778
|
|
|
(144,898
|
)
|
|
(78,459
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Distributions paid to common shareholders
|
|
(44,944
|
)
|
|
(40,472
|
)
|
|
(31,911
|
)
|
|||
Distributions paid to OP unit holders
|
|
(1,155
|
)
|
|
(1,241
|
)
|
|
(729
|
)
|
|||
Proceeds from issuance of common shares, net of offering costs
|
|
—
|
|
|
118,412
|
|
|
30,014
|
|
|||
Payments of exchange offer costs
|
|
(126
|
)
|
|
—
|
|
|
—
|
|
|||
Net proceeds from credit facility
|
|
9,000
|
|
|
45,600
|
|
|
59,000
|
|
|||
Repayments of notes payable
|
|
(2,543
|
)
|
|
(11,543
|
)
|
|
(14,335
|
)
|
|||
Payments of loan origination costs
|
|
(30
|
)
|
|
(695
|
)
|
|
—
|
|
|||
Repurchase of common shares
|
|
(1,961
|
)
|
|
(4,339
|
)
|
|
(3,948
|
)
|
|||
Net cash provided by (used in) financing activities
|
|
(41,759
|
)
|
|
105,722
|
|
|
38,091
|
|
|||
Net increase in cash, cash equivalents and restricted cash
|
|
8,576
|
|
|
2,222
|
|
|
280
|
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
|
5,210
|
|
|
2,988
|
|
|
2,708
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
13,786
|
|
|
$
|
5,210
|
|
|
$
|
2,988
|
|
Whitestone REIT and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
Supplemental Disclosures
(in thousands)
|
||||||||||||
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
24,610
|
|
|
$
|
22,541
|
|
|
$
|
18,287
|
|
Cash paid for taxes
|
|
$
|
304
|
|
|
$
|
337
|
|
|
$
|
284
|
|
Non cash investing and financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Disposal of fully depreciated real estate
|
|
$
|
937
|
|
|
$
|
1,036
|
|
|
$
|
690
|
|
Financed insurance premiums
|
|
$
|
1,273
|
|
|
$
|
1,115
|
|
|
$
|
1,060
|
|
Value of shares issued under dividend reinvestment plan
|
|
$
|
133
|
|
|
$
|
127
|
|
|
$
|
114
|
|
Value of common shares exchanged for OP units
|
|
$
|
1,546
|
|
|
$
|
206
|
|
|
$
|
125
|
|
Change in fair value of available-for-sale securities
|
|
$
|
18
|
|
|
$
|
118
|
|
|
$
|
82
|
|
Change in fair value of cash flow hedge
|
|
$
|
1,192
|
|
|
$
|
2,022
|
|
|
$
|
929
|
|
Acquisition of real estate in exchange for OP units
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,738
|
|
Reallocation of ownership percentage between parent and subsidiary
|
|
$
|
15
|
|
|
$
|
13
|
|
|
$
|
11
|
|
Debt issued with acquisitions of real estate
|
|
$
|
—
|
|
|
$
|
80,000
|
|
|
$
|
—
|
|
Property received as termination fee
|
|
$
|
250
|
|
|
$
|
—
|
|
|
$
|
—
|
|
•
|
51
wholly-owned properties that meet our Community Centered Properties
®
strategy; and
|
•
|
six
parcels of land held for future development.
|
|
|
Year Ended December 31, 2017
|
||||||||||
|
|
As Reported
|
|
Correction of Error
|
|
As Adjusted
|
||||||
Net income
|
|
$
|
8,866
|
|
|
$
|
(278
|
)
|
|
$
|
8,588
|
|
Net income attributable to noncontrolling interests
|
|
532
|
|
|
(278
|
)
|
|
254
|
|
|||
|
|
|
|
|
|
|
||||||
|
|
Year Ended December 31, 2016
|
||||||||||
|
|
As Reported
|
|
Correction of Error
|
|
As Adjusted
|
||||||
Net income
|
|
$
|
8,128
|
|
|
$
|
(15
|
)
|
|
$
|
8,113
|
|
Net income attributable to noncontrolling interests
|
|
197
|
|
|
(15
|
)
|
|
182
|
|
|
|
December 31, 2018
|
||||||||||||||
|
|
Amortized Cost
|
|
Gains in Accumulated Other Comprehensive Income
|
|
Losses in Accumulated Other Comprehensive Income
|
|
Estimated Fair Value
|
||||||||
Real estate sector common stock
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total available-for-sale securities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
December 31, 2017
|
||||||||||||||
|
|
Amortized Cost
|
|
Gains in Accumulated Other Comprehensive Income
|
|
Losses in Accumulated Other Comprehensive Income
|
|
Estimated Fair Value
|
||||||||
Real estate sector common stock
|
|
$
|
50
|
|
|
$
|
—
|
|
|
$
|
(18
|
)
|
|
$
|
32
|
|
Total available-for-sale securities
|
|
$
|
50
|
|
|
$
|
—
|
|
|
$
|
(18
|
)
|
|
$
|
32
|
|
|
|
Year Ended December 31,
|
||||||
(in thousands, except per share data)
|
|
2017
|
|
2016
|
||||
Total property revenues
|
|
$
|
133,663
|
|
|
$
|
129,385
|
|
Net income
|
|
$
|
11,322
|
|
|
$
|
16,963
|
|
Net income attributable to Whitestone REIT
(1)
|
|
$
|
10,990
|
|
|
$
|
16,583
|
|
|
|
|
|
|
||||
Basic Earnings Per Share:
|
|
$
|
0.28
|
|
|
$
|
0.45
|
|
|
|
|
|
|
||||
Diluted Earnings Per Share:
|
|
$
|
0.27
|
|
|
$
|
0.44
|
|
|
|
|
|
|
||||
Weighted-average common shares outstanding:
|
|
|
|
|
||||
Basic
(2)
|
|
37,933
|
|
|
35,637
|
|
||
Diluted
(2)
|
|
38,760
|
|
|
36,402
|
|
(1)
|
Net income attributable to Whitestone REIT reflects historical ownership percentages and does not reflect the effects of the April 2017 Offering (as defined in Note 14), assuming the sale of the common shares took place on January 1,
2016
, as the related impact on ownership percentage is minimal.
|
(2)
|
Pro forma weighted averages reflect the April 2017 Offering, assuming the sale of the common shares took place on January 1,
2016
.
|
|
|
|
The Company’s Investment as of December 31,
|
||
|
|
|
2018
|
||
Real estate partnership
|
Ownership Interest
|
|
|
||
Pillarstone OP
(1)(2)
|
81.4%
|
|
$
|
26,236
|
|
Total real estate partnership
(3)
|
|
|
26,236
|
|
|
|
Year Ended December 31,
|
||
|
|
2018
|
||
|
|
|
||
Pillarstone OP
|
|
$
|
8,431
|
|
|
|
December 31,
|
||
|
|
2018
|
||
|
|
|
||
Assets:
|
|
|
||
Real estate, net
|
|
$
|
72,661
|
|
Other assets
|
|
6,617
|
|
|
Total assets
|
|
79,278
|
|
|
Liabilities and equity:
|
|
|
||
Notes payable
|
|
47,064
|
|
|
Other liabilities
|
|
4,322
|
|
|
Equity
|
|
27,892
|
|
|
Total liabilities and equity
|
|
79,278
|
|
|
Company’s share of equity
|
|
22,717
|
|
|
Cost of investment in excess (deficit) of the Company’s share of underlying net book value
|
|
3,519
|
|
|
Carrying value of investment in real estate partnership
|
|
$
|
26,236
|
|
|
|
Year Ended December 31,
|
||
|
|
2018
|
||
|
|
|
||
Property revenues
|
|
$
|
17,180
|
|
Property expenses
|
|
(6,687
|
)
|
|
Other expenses
|
|
(7,848
|
)
|
|
Gain on sale of properties
|
|
7,839
|
|
|
|
|
|
||
Net income
|
|
$
|
10,484
|
|
|
|
||
Real estate assets, at cost
|
|
||
Property
|
$
|
95,146
|
|
Accumulated depreciation
|
(35,980
|
)
|
|
Total real estate assets
|
59,166
|
|
|
|
|
||
Investment in real estate partnership
|
4,095
|
|
|
|
|
||
Liabilities
|
|
||
Notes payable
(1)
|
(48,840
|
)
|
|
|
|
||
Net carrying value
|
$
|
14,421
|
|
(1)
|
Excludes approximately
$15.5 million
in notes payable due to Whitestone as of
December 31, 2017
.
|
Net carrying value
|
$
|
14,421
|
|
OP Unit Purchase Agreement
|
3,000
|
|
|
Notes payable
|
48,840
|
|
|
Maximum exposure to loss
|
$
|
66,261
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Tenant receivables
|
|
$
|
14,686
|
|
|
$
|
14,128
|
|
Accrued rents and other recoveries
|
|
16,423
|
|
|
15,620
|
|
||
Allowance for doubtful accounts
|
|
(9,746
|
)
|
|
(8,608
|
)
|
||
Other receivables
|
|
279
|
|
|
—
|
|
||
Totals
|
|
$
|
21,642
|
|
|
$
|
21,140
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Leasing commissions
|
|
$
|
8,789
|
|
|
$
|
7,861
|
|
Deferred legal cost
|
|
406
|
|
|
386
|
|
||
Deferred financing cost
|
|
4,076
|
|
|
4,071
|
|
||
Total cost
|
|
13,271
|
|
|
12,318
|
|
||
Less: leasing commissions accumulated amortization
|
|
(3,534
|
)
|
|
(3,046
|
)
|
||
Less: deferred legal cost accumulated amortization
|
|
(125
|
)
|
|
(52
|
)
|
||
Less: deferred financing cost accumulated amortization
|
|
(2,914
|
)
|
|
(2,063
|
)
|
||
Total cost, net of accumulated amortization
|
|
$
|
6,698
|
|
|
$
|
7,157
|
|
Years Ended December 31,
|
|
Leasing Commissions
|
|
Deferred Legal Costs
(1)
|
|
Deferred Financing Costs
|
|
Total
|
||||||||
2019
|
|
$
|
1,193
|
|
|
$
|
281
|
|
|
$
|
224
|
|
|
$
|
1,698
|
|
2020
|
|
1,038
|
|
|
—
|
|
|
199
|
|
|
1,237
|
|
||||
2021
|
|
869
|
|
|
—
|
|
|
187
|
|
|
1,056
|
|
||||
2022
|
|
681
|
|
|
—
|
|
|
187
|
|
|
868
|
|
||||
2023
|
|
489
|
|
|
—
|
|
|
168
|
|
|
657
|
|
||||
Thereafter
|
|
985
|
|
|
—
|
|
|
197
|
|
|
1,182
|
|
||||
Total
|
|
$
|
5,255
|
|
|
$
|
281
|
|
|
$
|
1,162
|
|
|
$
|
6,698
|
|
Years Ended December 31,
|
|
Minimum Future Rents
|
||
2019
|
|
$
|
81,149
|
|
2020
|
|
70,181
|
|
|
2021
|
|
59,550
|
|
|
2022
|
|
48,431
|
|
|
2023
|
|
37,327
|
|
|
Thereafter
|
|
122,102
|
|
|
Total
|
|
$
|
418,740
|
|
|
|
December 31,
|
||||||
Description
|
|
2018
|
|
2017
|
||||
Fixed rate notes
|
|
|
|
|
||||
$10.5 million, LIBOR plus 2.00% Note, due September 24, 2020
(1)
|
|
$
|
9,500
|
|
|
$
|
9,740
|
|
$50.0 million, 1.75% plus 1.35% to 1.90% Note, due October 30, 2020
(2)
|
|
50,000
|
|
|
50,000
|
|
||
$50.0 million, 1.50% plus 1.35% to 1.90% Note, due January 29, 2021
(3)
|
|
50,000
|
|
|
50,000
|
|
||
$100.0 million, 1.73% plus 1.65% to 2.25% Note, due October 30, 2022
(4)
|
|
100,000
|
|
|
100,000
|
|
||
$80.0 million, 3.72% Note, due June 1, 2027
|
|
80,000
|
|
|
80,000
|
|
||
$37.0 million 3.76% Note, due December 1, 2020
(5)
|
|
—
|
|
|
33,148
|
|
||
$6.5 million 3.80% Note, due January 1, 2019
|
|
5,657
|
|
|
5,842
|
|
||
$19.0 million 4.15% Note, due December 1, 2024
|
|
19,000
|
|
|
19,000
|
|
||
$20.2 million 4.28% Note, due June 6, 2023
|
|
18,996
|
|
|
19,360
|
|
||
$14.0 million 4.34% Note, due September 11, 2024
|
|
13,718
|
|
|
13,944
|
|
||
$14.3 million 4.34% Note, due September 11, 2024
|
|
14,300
|
|
|
14,300
|
|
||
$16.5 million 4.97% Note, due September 26, 2023
(5)
|
|
—
|
|
|
16,058
|
|
||
$15.1 million 4.99% Note, due January 6, 2024
|
|
14,643
|
|
|
14,865
|
|
||
$2.6 million 5.46% Note, due October 1, 2023
|
|
2,430
|
|
|
2,472
|
|
||
Floating rate notes
|
|
|
|
|
||||
Unsecured line of credit, LIBOR plus 1.40% to 1.95%, due October 30, 2019
(6)
|
|
241,200
|
|
|
232,200
|
|
||
Total notes payable principal
|
|
619,444
|
|
|
660,929
|
|
||
Less deferred financing costs, net of accumulated amortization
|
|
(1,239
|
)
|
|
(1,861
|
)
|
||
|
|
$
|
618,205
|
|
|
$
|
659,068
|
|
(1)
|
Promissory note includes an interest rate swap that fixed the interest rate at
3.55%
for the duration of the term through September 24, 2018 and
4.85%
beginning September 24, 2018 through September 24, 2020.
|
(2)
|
Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 1 (as defined below) at
0.84%
through February 3, 2017 and
1.75%
beginning February 3, 2017 through October 30, 2020.
|
(3)
|
Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 2 (as defined below) at
1.50%
.
|
(4)
|
Promissory note includes an interest rate swap that fixed the LIBOR portion of Term Loan 3 (as defined below) at
1.73%
.
|
(5)
|
Promissory notes were assumed by Pillarstone OP in December 2016 and included in our consolidated balance sheet under the profit-sharing method of accounting through December 31, 2017, as discussed in Note 5.
|
(6)
|
Unsecured line of credit includes certain Pillarstone Properties (as defined and described in more detail below) in determining the amount of credit available under the 2018 Facility (as defined and described in more detail below).
|
•
|
extended the maturity date of the
$300 million
unsecured revolving credit facility under the 2014 Facility (the “Revolver”) to October 30, 2019 from November 7, 2018;
|
•
|
converted
$100 million
of outstanding borrowings under the Revolver to a new
$100 million
unsecured term loan under the 2014 Facility (“Term Loan 3”) with a maturity date of October 30, 2022;
|
•
|
extended the maturity date of the first
$50 million
unsecured term loan under the 2014 Facility (“Term Loan 1”) to October 30, 2020 from February 17, 2017; and
|
•
|
extended the maturity date of the second
$50 million
unsecured term loan under the 2014 Facility (“Term Loan 2” and together with Term Loan 1 and Term Loan 3, the “Term Loans”) to January 29, 2021 from November 7, 2019.
|
|
|
Amount Due
|
||
Year
|
|
(in thousands)
|
||
2019
|
|
$
|
248,199
|
|
2020
|
|
60,801
|
|
|
2021
|
|
51,611
|
|
|
2022
|
|
101,683
|
|
|
2023
|
|
20,720
|
|
|
Thereafter
|
|
136,430
|
|
|
Total
|
|
$
|
619,444
|
|
|
|
|
|
Payment due by period (in thousands)
|
||||||||||||||||
Consolidated Contractual Obligations
|
|
Total
|
|
Less than 1
year (2019) |
|
1 - 3 years
(2020 - 2021) |
|
3 - 5 years
(2022 - 2023) |
|
More than
5 years (after 2023) |
||||||||||
Long-Term Debt - Principal
|
|
$
|
619,444
|
|
|
$
|
248,199
|
|
|
$
|
112,412
|
|
|
$
|
122,403
|
|
|
$
|
136,430
|
|
Long-Term Debt - Fixed Interest
|
|
60,492
|
|
|
13,131
|
|
|
22,772
|
|
|
12,689
|
|
|
11,900
|
|
|||||
Long-Term Debt - Variable Interest
(1)
|
|
6,633
|
|
|
6,633
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Unsecured credit facility - Unused commitment fee
(2)
|
|
98
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating Lease Obligations
|
|
185
|
|
|
85
|
|
|
100
|
|
|
—
|
|
|
—
|
|
|||||
Related Party Rent Lease Obligations
|
|
963
|
|
|
441
|
|
|
522
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
687,815
|
|
|
$
|
268,587
|
|
|
$
|
135,806
|
|
|
$
|
135,092
|
|
|
$
|
148,330
|
|
(1)
|
As of
December 31, 2018
, we had
one
loan totaling
$241.2 million
which bore interest at a floating rate. The variable interest rate payments are based on
LIBOR
plus
1.40%
to
LIBOR
plus
1.95%
, which reflects our new interest rates under the 2018 Facility. 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, 2018
, of
2.35%
.
|
(2)
|
The unused commitment fees on the 2018 Facility, payable quarterly, are based on the average daily unused amount of the 2018 Facility. The fees are
0.20%
for facility usage greater than
50%
or
0.25%
for facility usage less than
50%
. The information in the table above reflects our projected obligations for the 2018 Facility based on our
December 31, 2018
balance of
$441.2 million
.
|
|
|
December 31, 2018
|
|||
Balance Sheet Location
|
|
Estimated Fair Value
|
|||
Prepaid expenses and other assets
|
|
|
$
|
4,286
|
|
Accounts payable and accrued expenses
|
|
|
$
|
(59
|
)
|
|
|
December 31, 2017
|
|||
Balance Sheet Location
|
|
Estimated Fair Value
|
|||
Prepaid expenses and other assets
|
|
|
$
|
3,036
|
|
|
|
Amount Recognized as Comprehensive Income
|
|
Location of Loss Recognized in Earnings
|
|
Amount of Loss Recognized in Earnings
(1)
|
||||
Year ended December 31, 2018
|
|
$
|
1,192
|
|
|
Interest expense
|
|
$
|
646
|
|
Year ended December 31, 2017
|
|
$
|
2,022
|
|
|
Interest expense
|
|
$
|
(1,575
|
)
|
Year ended December 31, 2016
|
|
$
|
929
|
|
|
Interest expense
|
|
$
|
(2,385
|
)
|
(1)
|
Amounts represent the effective portions of our interest rate swaps. We did not recognize any ineffective portion of our interest rate swaps in earnings for the years ended
December 31, 2018
,
2017
and
2016
.
|
|
|
Year Ended December 31,
|
||||||||||
(in thousands, except per share data)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Numerator:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
21,981
|
|
|
$
|
8,588
|
|
|
$
|
8,113
|
|
Less: Net income attributable to noncontrolling interests
|
|
(550
|
)
|
|
(254
|
)
|
|
(182
|
)
|
|||
Distributions paid on unvested restricted shares
|
|
(301
|
)
|
|
(456
|
)
|
|
(620
|
)
|
|||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
21,130
|
|
|
$
|
7,878
|
|
|
$
|
7,311
|
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
|
||||||
Weighted average number of common shares - basic
|
|
39,274
|
|
|
35,428
|
|
|
27,618
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
|
||||||
Unvested restricted shares
|
|
1,338
|
|
|
827
|
|
|
765
|
|
|||
Weighted average number of common shares - dilutive
|
|
40,612
|
|
|
36,255
|
|
|
28,383
|
|
|||
|
|
|
|
|
|
|
||||||
Earnings Per Share:
|
|
|
|
|
|
|
||||||
Basic:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.54
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
Diluted:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
|
|
$
|
0.52
|
|
|
$
|
0.22
|
|
|
$
|
0.26
|
|
|
|
2018
|
|
2017
|
|
2016
|
|||
Ordinary income (unaudited)
|
|
39.1
|
%
|
|
15.3
|
%
|
|
49.0
|
%
|
Return of capital (unaudited)
|
|
26.5
|
%
|
|
84.7
|
%
|
|
33.7
|
%
|
Capital gain distributions (unaudited)
|
|
34.4
|
%
|
|
—
|
%
|
|
17.3
|
%
|
Total
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
||
|
|
Location of Revenue (Expense)
|
|
|
||
Rent
|
|
Property operation and maintenance
|
|
$
|
(779
|
)
|
Property management fee income
|
|
Other revenues
|
|
$
|
1,008
|
|
Interest income
|
|
Interest, dividend and other investment income
|
|
$
|
582
|
|
|
|
Common Shares
|
|
Noncontrolling OP Unit Holders
|
|
Total
|
||||||||||||||
Quarter Paid
|
|
Distribution Per Common Share
|
|
Total Amount Paid
|
|
Distribution Per OP Unit
|
|
Total Amount Paid
|
|
Total Amount Paid
|
||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
11,302
|
|
|
$
|
0.2850
|
|
|
$
|
265
|
|
|
$
|
11,567
|
|
Third Quarter
|
|
0.2850
|
|
|
11,294
|
|
|
0.2850
|
|
|
286
|
|
|
11,580
|
|
|||||
Second Quarter
|
|
0.2850
|
|
|
11,203
|
|
|
0.2850
|
|
|
295
|
|
|
11,498
|
|
|||||
First Quarter
|
|
0.2850
|
|
|
11,145
|
|
|
0.2850
|
|
|
309
|
|
|
11,454
|
|
|||||
Total
|
|
$
|
1.1400
|
|
|
$
|
44,944
|
|
|
$
|
1.1400
|
|
|
$
|
1,155
|
|
|
$
|
46,099
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fourth Quarter
|
|
$
|
0.2850
|
|
|
$
|
11,002
|
|
|
$
|
0.2850
|
|
|
$
|
309
|
|
|
$
|
11,311
|
|
Third Quarter
|
|
0.2850
|
|
|
10,948
|
|
|
0.2850
|
|
|
309
|
|
|
11,257
|
|
|||||
Second Quarter
|
|
0.2850
|
|
|
10,093
|
|
|
0.2850
|
|
|
310
|
|
|
10,403
|
|
|||||
First Quarter
|
|
0.2850
|
|
|
8,429
|
|
|
0.2850
|
|
|
313
|
|
|
8,742
|
|
|||||
Total
|
|
$
|
1.1400
|
|
|
$
|
40,472
|
|
|
$
|
1.1400
|
|
|
$
|
1,241
|
|
|
$
|
41,713
|
|
|
|
Shares
|
|
Weighted-Average
Grant Date
Fair Value
(1)
|
|||
Non-vested at January 1, 2018
|
|
2,481,331
|
|
|
$
|
13.60
|
|
Granted
|
|
653,472
|
|
|
11.07
|
|
|
Vested
|
|
(560,126
|
)
|
|
14.24
|
|
|
Forfeited
|
|
(651,295
|
)
|
|
14.03
|
|
|
Non-vested at December 31, 2018
|
|
1,923,382
|
|
|
$
|
12.41
|
|
Available for grant at December 31, 2018
|
|
3,172,158
|
|
|
|
(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)
|
||||||
Year Ended December 31, 2018
|
|
653,472
|
|
|
$
|
11.07
|
|
|
(560,126
|
)
|
|
$
|
7,978
|
|
Year Ended December 31, 2017
|
|
1,354,534
|
|
|
$
|
12.92
|
|
|
(881,710
|
)
|
|
$
|
12,829
|
|
Year Ended December 31, 2016
|
|
545,778
|
|
|
$
|
14.85
|
|
|
(734,261
|
)
|
|
$
|
10,577
|
|
|
|
First
|
|
Second
|
|
Third
|
|
|
||||||||
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Fourth
|
||||||||
|
|
(As restated)
|
|
(As restated)
|
|
(As restated)
|
|
Quarter
|
||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues
|
|
$
|
29,785
|
|
|
$
|
29,473
|
|
|
$
|
30,704
|
|
|
$
|
29,901
|
|
Net income
|
|
$
|
3,269
|
|
|
$
|
2,005
|
|
|
$
|
8,033
|
|
|
$
|
8,674
|
|
Net income attributable to Whitestone REIT
|
|
$
|
3,181
|
|
|
$
|
1,954
|
|
|
$
|
7,835
|
|
|
$
|
8,457
|
|
Basic Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
$
|
0.08
|
|
|
$
|
0.05
|
|
|
$
|
0.20
|
|
|
$
|
0.21
|
|
Diluted Earnings per share:
|
|
|
|
|
|
|
|
|
||||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
$
|
0.08
|
|
|
$
|
0.05
|
|
|
$
|
0.19
|
|
|
$
|
0.21
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
||||||||
2017
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
28,267
|
|
|
$
|
30,208
|
|
|
$
|
33,653
|
|
|
$
|
33,831
|
|
Net income
|
|
$
|
1,493
|
|
|
$
|
2,043
|
|
|
$
|
3,077
|
|
|
$
|
1,975
|
|
Net income attributable to Whitestone REIT
|
|
$
|
1,440
|
|
|
$
|
1,983
|
|
|
$
|
2,993
|
|
|
$
|
1,921
|
|
Basic Earnings per share:
|
|
|
|
|
|
|
|
|
||||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.07
|
|
|
$
|
0.05
|
|
Diluted Earnings per share:
|
|
|
|
|
|
|
|
|
||||||||
Net income attributable to common shareholders excluding amounts attributable to unvested restricted shares
(1)
|
|
$
|
0.04
|
|
|
$
|
0.05
|
|
|
$
|
0.07
|
|
|
$
|
0.05
|
|
(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.
|
CONSOLIDATED BALANCE SHEETS
|
||||||||||||
(in thousands, except per share data)
|
||||||||||||
|
|
Unaudited
March 31, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
ASSETS
|
||||||||||||
Real estate assets, at cost
|
|
|
|
|
|
|
||||||
Property
|
|
$
|
1,148,176
|
|
|
$
|
(96,192
|
)
|
|
$
|
1,051,984
|
|
Accumulated depreciation
|
|
(135,599
|
)
|
|
36,811
|
|
|
(98,788
|
)
|
|||
Total real estate assets
|
|
1,012,577
|
|
|
(59,381
|
)
|
|
953,196
|
|
|||
Investment in real estate partnership
|
|
—
|
|
|
19,298
|
|
|
19,298
|
|
|||
Cash and cash equivalents
|
|
9,337
|
|
|
(2,361
|
)
|
|
6,976
|
|
|||
Restricted cash
|
|
257
|
|
|
—
|
|
|
257
|
|
|||
Escrows and acquisition deposits
|
|
6,690
|
|
|
(1,133
|
)
|
|
5,557
|
|
|||
Accrued rents and accounts receivable, net of allowance for doubtful accounts
|
|
24,675
|
|
|
(2,866
|
)
|
|
21,809
|
|
|||
Receivable due from related party
|
|
—
|
|
|
894
|
|
|
894
|
|
|||
Financed receivable due from related party
|
|
—
|
|
|
15,473
|
|
|
15,473
|
|
|||
Unamortized lease commissions and loan costs
|
|
8,260
|
|
|
(1,238
|
)
|
|
7,022
|
|
|||
Prepaid expenses and other assets
|
|
9,451
|
|
|
(10
|
)
|
|
9,441
|
|
|||
Total assets
|
|
$
|
1,071,247
|
|
|
$
|
(31,324
|
)
|
|
$
|
1,039,923
|
|
|
|
|
|
|
|
|
||||||
LIABILITIES AND EQUITY
|
||||||||||||
Liabilities:
|
|
|
|
|
|
|
||||||
Notes payable
|
|
$
|
668,526
|
|
|
$
|
(48,540
|
)
|
|
$
|
619,986
|
|
Accounts payable and accrued expenses
|
|
30,198
|
|
|
(1,576
|
)
|
|
28,622
|
|
|||
Payable due to related party
|
|
—
|
|
|
699
|
|
|
699
|
|
|||
Tenants’ security deposits
|
|
7,028
|
|
|
(1,262
|
)
|
|
5,766
|
|
|||
Dividends and distributions payable
|
|
11,489
|
|
|
—
|
|
|
11,489
|
|
|||
Total liabilities
|
|
717,241
|
|
|
(50,679
|
)
|
|
666,562
|
|
|||
Commitments and contingencies:
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Equity:
|
|
|
|
|
|
|
||||||
Preferred shares, $0.001 par value per share; 50,000,000 shares authorized; none issued and outstanding as of March 31, 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common shares, $0.001 par value per share; 400,000,000 shares authorized; 39,179,540 issued and outstanding as of March 31, 2018
|
|
38
|
|
|
—
|
|
|
38
|
|
|||
Additional paid-in capital
|
|
522,730
|
|
|
—
|
|
|
522,730
|
|
|||
Accumulated deficit
|
|
(184,853
|
)
|
|
19,272
|
|
|
(165,581
|
)
|
|||
Accumulated other comprehensive gain
|
|
5,528
|
|
|
—
|
|
|
5,528
|
|
|||
Total Whitestone REIT shareholders’ equity
|
|
343,443
|
|
|
19,272
|
|
|
362,715
|
|
|||
Redeemable operating partnership units
|
|
10,642
|
|
|
4
|
|
|
10,646
|
|
|||
Noncontrolling interest in subsidiary
|
|
(79
|
)
|
|
79
|
|
|
—
|
|
|||
Total equity
|
|
354,006
|
|
|
19,355
|
|
|
373,361
|
|
|||
Total liabilities and equity
|
|
$
|
1,071,247
|
|
|
$
|
(31,324
|
)
|
|
$
|
1,039,923
|
|
CONSOLIDATED BALANCE SHEETS
|
||||||||||||
(in thousands, except per share data)
|
||||||||||||
|
|
|
|
|
|
|
||||||
|
|
Unaudited
June 30, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
ASSETS
|
||||||||||||
Real estate assets, at cost
|
|
|
|
|
|
|
||||||
Property
|
|
$
|
1,149,528
|
|
|
$
|
(96,757
|
)
|
|
$
|
1,052,771
|
|
Accumulated depreciation
|
|
(141,442
|
)
|
|
37,746
|
|
|
(103,696
|
)
|
|||
Total real estate assets
|
|
1,008,086
|
|
|
(59,011
|
)
|
|
949,075
|
|
|||
Investment in real estate partnership
|
|
4,419
|
|
|
15,465
|
|
|
19,884
|
|
|||
Cash and cash equivalents
|
|
3,125
|
|
|
—
|
|
|
3,125
|
|
|||
Restricted cash
|
|
213
|
|
|
—
|
|
|
213
|
|
|||
Escrows and acquisition deposits
|
|
6,515
|
|
|
—
|
|
|
6,515
|
|
|||
Accrued rents and accounts receivable, net of allowance for doubtful accounts
|
|
20,464
|
|
|
—
|
|
|
20,464
|
|
|||
Receivable due from related party
|
|
—
|
|
|
772
|
|
|
772
|
|
|||
Financed receivable due from related party
|
|
—
|
|
|
15,473
|
|
|
15,473
|
|
|||
Unamortized lease commissions and loan costs
|
|
6,911
|
|
|
—
|
|
|
6,911
|
|
|||
Prepaid expenses and other assets
|
|
10,217
|
|
|
—
|
|
|
10,217
|
|
|||
Total assets
|
|
$
|
1,059,950
|
|
|
$
|
(27,301
|
)
|
|
$
|
1,032,649
|
|
|
|
|
|
|
|
|
||||||
LIABILITIES AND EQUITY
|
||||||||||||
Liabilities:
|
|
|
|
|
|
|
||||||
Notes payable
|
|
$
|
667,595
|
|
|
$
|
(48,241
|
)
|
|
$
|
619,354
|
|
Accounts payable and accrued expenses
|
|
29,157
|
|
|
347
|
|
|
29,504
|
|
|||
Payable due to related party
|
|
—
|
|
|
1,067
|
|
|
1,067
|
|
|||
Tenants’ security deposits
|
|
5,769
|
|
|
—
|
|
|
5,769
|
|
|||
Dividends and distributions payable
|
|
11,628
|
|
|
—
|
|
|
11,628
|
|
|||
Total liabilities
|
|
714,149
|
|
|
(46,827
|
)
|
|
667,322
|
|
|||
Commitments and contingencies:
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Equity:
|
|
|
|
|
|
|
||||||
Preferred shares, $0.001 par value per share; 50,000,000 shares authorized; none issued and outstanding as of June 30, 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common shares, $0.001 par value per share; 400,000,000 shares authorized; 39,743,829 issued and outstanding as of June 30, 2018
|
|
38
|
|
|
—
|
|
|
38
|
|
|||
Additional paid-in capital
|
|
524,191
|
|
|
—
|
|
|
524,191
|
|
|||
Accumulated deficit
|
|
(194,520
|
)
|
|
19,516
|
|
|
(175,004
|
)
|
|||
Accumulated other comprehensive gain
|
|
6,430
|
|
|
—
|
|
|
6,430
|
|
|||
Total Whitestone REIT shareholders’ equity
|
|
336,139
|
|
|
19,516
|
|
|
355,655
|
|
|||
Noncontrolling interest in subsidiary
|
|
9,662
|
|
|
10
|
|
|
9,672
|
|
|||
Total equity
|
|
345,801
|
|
|
19,526
|
|
|
365,327
|
|
|||
Total liabilities and equity
|
|
$
|
1,059,950
|
|
|
$
|
(27,301
|
)
|
|
$
|
1,032,649
|
|
CONSOLIDATED BALANCE SHEETS
|
||||||||||||
(in thousands, except per share data)
|
||||||||||||
|
|
Unaudited
September 30, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
ASSETS
|
||||||||||||
Real estate assets, at cost
|
|
|
|
|
|
|
||||||
Property
|
|
$
|
1,146,951
|
|
|
$
|
(97,636
|
)
|
|
$
|
1,049,315
|
|
Accumulated depreciation
|
|
(145,807
|
)
|
|
38,642
|
|
|
(107,165
|
)
|
|||
Total real estate assets
|
|
1,001,144
|
|
|
(58,994
|
)
|
|
942,150
|
|
|||
Investment in real estate partnership
|
|
2,770
|
|
|
17,616
|
|
|
20,386
|
|
|||
Cash and cash equivalents
|
|
9,389
|
|
|
—
|
|
|
9,389
|
|
|||
Restricted cash
|
|
91
|
|
|
—
|
|
|
91
|
|
|||
Escrows and acquisition deposits
|
|
7,702
|
|
|
—
|
|
|
7,702
|
|
|||
Accrued rents and accounts receivable, net of allowance for doubtful accounts
|
|
21,906
|
|
|
(12
|
)
|
|
21,894
|
|
|||
Receivable due from related party
|
|
—
|
|
|
308
|
|
|
308
|
|
|||
Financed receivable due from related party
|
|
—
|
|
|
14,473
|
|
|
14,473
|
|
|||
Unamortized lease commissions and loan costs
|
|
6,847
|
|
|
—
|
|
|
6,847
|
|
|||
Prepaid expenses and other assets
|
|
10,597
|
|
|
—
|
|
|
10,597
|
|
|||
Total assets
|
|
$
|
1,060,446
|
|
|
$
|
(26,609
|
)
|
|
$
|
1,033,837
|
|
|
|
|
|
|
|
|
||||||
LIABILITIES AND EQUITY
|
||||||||||||
Liabilities:
|
|
|
|
|
|
|
||||||
Notes payable
|
|
$
|
666,624
|
|
|
$
|
(47,939
|
)
|
|
$
|
618,685
|
|
Accounts payable and accrued expenses
|
|
32,846
|
|
|
332
|
|
|
33,178
|
|
|||
Payable due to related party
|
|
—
|
|
|
1,276
|
|
|
1,276
|
|
|||
Tenants’ security deposits
|
|
5,920
|
|
|
—
|
|
|
5,920
|
|
|||
Dividends and distributions payable
|
|
11,600
|
|
|
—
|
|
|
11,600
|
|
|||
Total liabilities
|
|
716,990
|
|
|
(46,331
|
)
|
|
670,659
|
|
|||
Commitments and contingencies:
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Equity:
|
|
|
|
|
|
|
||||||
Preferred shares, $0.001 par value per share; 50,000,000 shares authorized; none issued and outstanding as of September 30, 2018
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common shares, $0.001 par value per share; 400,000,000 shares authorized; 39,772,105 issued and outstanding as of September 30, 2018
|
|
38
|
|
|
—
|
|
|
38
|
|
|||
Additional paid-in capital
|
|
525,780
|
|
|
—
|
|
|
525,780
|
|
|||
Accumulated deficit
|
|
(198,199
|
)
|
|
19,706
|
|
|
(178,493
|
)
|
|||
Accumulated other comprehensive gain
|
|
7,034
|
|
|
—
|
|
|
7,034
|
|
|||
Total Whitestone REIT shareholders’ equity
|
|
334,653
|
|
|
19,706
|
|
|
354,359
|
|
|||
Noncontrolling interest in subsidiary
|
|
8,803
|
|
|
16
|
|
|
8,819
|
|
|||
Total equity
|
|
343,456
|
|
|
19,722
|
|
|
363,178
|
|
|||
Total liabilities and equity
|
|
$
|
1,060,446
|
|
|
$
|
(26,609
|
)
|
|
$
|
1,033,837
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(in thousands, except per share data)
|
||||||||||||
|
|
Unaudited
Three Months Ended
March 31, 2018
|
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
|
|
|
|
|
|
|
||||||
Property revenues
|
|
|
|
|
|
|
||||||
Rental revenues
|
|
$
|
24,946
|
|
|
$
|
(3,274
|
)
|
|
$
|
21,672
|
|
Other revenues
|
|
8,650
|
|
|
(537
|
)
|
|
8,113
|
|
|||
Total property revenues
|
|
33,596
|
|
|
(3,811
|
)
|
|
29,785
|
|
|||
|
|
|
|
|
|
|
||||||
Property expenses
|
|
|
|
|
|
|
|
|
||||
Property operation and maintenance
|
|
5,708
|
|
|
(852
|
)
|
|
4,856
|
|
|||
Real estate taxes
|
|
4,657
|
|
|
(681
|
)
|
|
3,976
|
|
|||
Total property expenses
|
|
10,365
|
|
|
(1,533
|
)
|
|
8,832
|
|
|||
|
|
|
|
|
|
|
||||||
Other expenses (income)
|
|
|
|
|
|
|
|
|
|
|||
General and administrative
|
|
6,314
|
|
|
13
|
|
|
6,327
|
|
|||
Depreciation and amortization
|
|
7,221
|
|
|
(947
|
)
|
|
6,274
|
|
|||
Equity in earnings of real estate partnership
|
|
—
|
|
|
(674
|
)
|
|
(674
|
)
|
|||
Interest expense
|
|
6,501
|
|
|
(528
|
)
|
|
5,973
|
|
|||
Interest, dividend and other investment income
|
|
(99
|
)
|
|
(158
|
)
|
|
(257
|
)
|
|||
Total other expense
|
|
19,937
|
|
|
(2,294
|
)
|
|
17,643
|
|
|||
|
|
|
|
|
|
|
||||||
Income before gain (loss) on sale or disposal of properties or assets, and income taxes
|
|
3,294
|
|
|
16
|
|
|
3,310
|
|
|||
|
|
|
|
|
|
|
||||||
Provision for income taxes
|
|
(129
|
)
|
|
19
|
|
|
(110
|
)
|
|||
Gain on sale of properties
|
|
266
|
|
|
(17
|
)
|
|
249
|
|
|||
Loss on sale or disposal of assets
|
|
(197
|
)
|
|
17
|
|
|
(180
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net income
|
|
3,234
|
|
|
35
|
|
|
3,269
|
|
|||
|
|
|
|
|
|
|
||||||
Redeemable operating partnership units
|
|
84
|
|
|
4
|
|
|
88
|
|
|||
Non-controlling interests in Consolidated Partnership
|
|
122
|
|
|
(122
|
)
|
|
—
|
|
|||
Less: Net income attributable to noncontrolling interests
|
|
206
|
|
|
(118
|
)
|
|
88
|
|
|||
|
|
|
|
|
|
|
||||||
Net income attributable to Whitestone REIT
|
|
$
|
3,028
|
|
|
$
|
153
|
|
|
$
|
3,181
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(in thousands, except per share data)
|
||||||||||||
|
|
Unaudited
Three Months Ended March 31, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
|
|
|
|
|
|
|
||||||
Basic Earnings Per Share:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.08
|
|
|
$
|
0.00
|
|
|
$
|
0.08
|
|
Diluted Earnings Per Share:
|
|
|
|
|
|
|
||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.07
|
|
|
$
|
0.01
|
|
|
$
|
0.08
|
|
|
|
|
|
|
|
|
||||||
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
39,066
|
|
|
—
|
|
|
39,066
|
|
|||
Diluted
|
|
40,088
|
|
|
—
|
|
|
40,088
|
|
|||
|
|
|
|
|
|
|
||||||
Distributions declared per common share / OP unit
|
|
$
|
0.2850
|
|
|
$
|
—
|
|
|
$
|
0.2850
|
|
|
|
|
|
|
|
|
||||||
Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
3,234
|
|
|
$
|
35
|
|
|
$
|
3,269
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive gain
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
Unrealized gain on cash flow hedging activities
|
|
2,645
|
|
|
—
|
|
|
2,645
|
|
|||
Unrealized gain on available-for-sale marketable securities
|
|
18
|
|
|
—
|
|
|
18
|
|
|||
|
|
|
|
|
|
|
||||||
Comprehensive income
|
|
5,897
|
|
|
35
|
|
|
5,932
|
|
|||
|
|
|
|
|
|
|
||||||
Less: Net income attributable to noncontrolling interests
|
|
206
|
|
|
(118
|
)
|
|
88
|
|
|||
Less: Comprehensive gain attributable to noncontrolling interests
|
|
71
|
|
|
—
|
|
|
71
|
|
|||
|
|
|
|
|
|
|
||||||
Comprehensive income attributable to Whitestone REIT
|
|
$
|
5,620
|
|
|
$
|
153
|
|
|
$
|
5,773
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(in thousands, except per share data)
|
||||||||||||||||||||||||
|
|
Unaudited
Three Months Ended
June 30, 2018 |
|
Unaudited
Six Months Ended
June 30, 2018 |
||||||||||||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Rental revenues
|
|
$
|
24,650
|
|
|
$
|
(3,268
|
)
|
|
$
|
21,382
|
|
|
$
|
49,596
|
|
|
$
|
(6,542
|
)
|
|
$
|
43,054
|
|
Other revenues
|
|
8,422
|
|
|
(331
|
)
|
|
8,091
|
|
|
17,072
|
|
|
(868
|
)
|
|
16,204
|
|
||||||
Total property revenues
|
|
33,072
|
|
|
(3,599
|
)
|
|
29,473
|
|
|
66,668
|
|
|
(7,410
|
)
|
|
59,258
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Property operation and maintenance
|
|
5,838
|
|
|
(821
|
)
|
|
5,017
|
|
|
11,546
|
|
|
(1,673
|
)
|
|
9,873
|
|
||||||
Real estate taxes
|
|
4,485
|
|
|
(580
|
)
|
|
3,905
|
|
|
9,142
|
|
|
(1,261
|
)
|
|
7,881
|
|
||||||
Total property expenses
|
|
10,323
|
|
|
(1,401
|
)
|
|
8,922
|
|
|
20,688
|
|
|
(2,934
|
)
|
|
17,754
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other expenses (income)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
General and administrative
|
|
6,624
|
|
|
54
|
|
|
6,678
|
|
|
12,938
|
|
|
67
|
|
|
13,005
|
|
||||||
Depreciation and amortization
|
|
7,396
|
|
|
(1,103
|
)
|
|
6,293
|
|
|
14,617
|
|
|
(2,050
|
)
|
|
12,567
|
|
||||||
Equity in earnings of real estate partnership
|
|
—
|
|
|
(586
|
)
|
|
(586
|
)
|
|
—
|
|
|
(1,260
|
)
|
|
(1,260
|
)
|
||||||
Interest expense
|
|
6,854
|
|
|
(541
|
)
|
|
6,313
|
|
|
13,355
|
|
|
(1,069
|
)
|
|
12,286
|
|
||||||
Interest, dividend and other investment income
|
|
(119
|
)
|
|
(165
|
)
|
|
(284
|
)
|
|
(218
|
)
|
|
(323
|
)
|
|
(541
|
)
|
||||||
Total other expense
|
|
20,755
|
|
|
(2,341
|
)
|
|
18,414
|
|
|
40,692
|
|
|
(4,635
|
)
|
|
36,057
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income before gain (loss) on sale or disposal of properties or assets, income taxes, and profit sharing expense
|
|
1,994
|
|
|
143
|
|
|
2,137
|
|
|
5,288
|
|
|
159
|
|
|
5,447
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for income taxes
|
|
(84
|
)
|
|
25
|
|
|
(59
|
)
|
|
(213
|
)
|
|
44
|
|
|
(169
|
)
|
||||||
Gain on sale of properties
|
|
—
|
|
|
—
|
|
|
—
|
|
|
266
|
|
|
(17
|
)
|
|
249
|
|
||||||
Profit sharing expense
|
|
(81
|
)
|
|
81
|
|
|
—
|
|
|
(203
|
)
|
|
203
|
|
|
—
|
|
||||||
Loss on sale or disposal of assets
|
|
(74
|
)
|
|
1
|
|
|
(73
|
)
|
|
(271
|
)
|
|
18
|
|
|
(253
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
|
1,755
|
|
|
250
|
|
|
2,005
|
|
|
4,867
|
|
|
407
|
|
|
5,274
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less: Net income attributable to noncontrolling interests
|
|
45
|
|
|
6
|
|
|
51
|
|
|
128
|
|
|
10
|
|
|
138
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income attributable to Whitestone REIT
|
|
$
|
1,710
|
|
|
$
|
244
|
|
|
$
|
1,954
|
|
|
$
|
4,739
|
|
|
$
|
397
|
|
|
$
|
5,136
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(in thousands, except per share data)
|
||||||||||||||||||||||||
|
|
Unaudited
Three Months Ended June 30, 2018 |
|
Unaudited
Six Months Ended June 30, 2018 |
||||||||||||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.04
|
|
|
$
|
0.01
|
|
|
$
|
0.05
|
|
|
$
|
0.12
|
|
|
$
|
0.01
|
|
|
$
|
0.13
|
|
Diluted Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.04
|
|
|
$
|
0.01
|
|
|
$
|
0.05
|
|
|
$
|
0.11
|
|
|
$
|
0.01
|
|
|
$
|
0.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
|
39,204
|
|
|
—
|
|
|
39,204
|
|
|
39,136
|
|
|
—
|
|
|
39,136
|
|
||||||
Diluted
|
|
40,679
|
|
|
—
|
|
|
40,679
|
|
|
40,519
|
|
|
—
|
|
|
40,519
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Distributions declared per common share / OP unit
|
|
$
|
0.2850
|
|
|
$
|
—
|
|
|
$
|
0.2850
|
|
|
$
|
0.5700
|
|
|
$
|
—
|
|
|
$
|
0.5700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
|
$
|
1,755
|
|
|
$
|
250
|
|
|
$
|
2,005
|
|
|
$
|
4,867
|
|
|
$
|
407
|
|
|
$
|
5,274
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive gain
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unrealized gain on cash flow hedging activities
|
|
913
|
|
|
—
|
|
|
913
|
|
|
3,558
|
|
|
—
|
|
|
3,558
|
|
||||||
Unrealized gain on available-for-sale marketable securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
18
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income
|
|
2,668
|
|
|
250
|
|
|
2,918
|
|
|
8,443
|
|
|
407
|
|
|
8,850
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less: Net income attributable to noncontrolling interests
|
|
45
|
|
|
6
|
|
|
51
|
|
|
128
|
|
|
10
|
|
|
138
|
|
||||||
Less: Comprehensive gain attributable to noncontrolling interests
|
|
23
|
|
|
—
|
|
|
23
|
|
|
94
|
|
|
—
|
|
|
94
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income attributable to Whitestone REIT
|
|
$
|
2,600
|
|
|
$
|
244
|
|
|
$
|
2,844
|
|
|
$
|
8,221
|
|
|
$
|
397
|
|
|
$
|
8,618
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(in thousands, except per share data)
|
||||||||||||||||||||||||
|
|
Unaudited
Three Months Ended
September 30, 2018 |
|
Unaudited
Nine Months Ended
September 30, 2018 |
||||||||||||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Rental revenues
|
|
$
|
25,256
|
|
|
$
|
(3,292
|
)
|
|
$
|
21,964
|
|
|
$
|
74,852
|
|
|
$
|
(9,834
|
)
|
|
$
|
65,018
|
|
Other revenues
|
|
9,340
|
|
|
(600
|
)
|
|
8,740
|
|
|
26,412
|
|
|
(1,468
|
)
|
|
24,944
|
|
||||||
Total property revenues
|
|
34,596
|
|
|
(3,892
|
)
|
|
30,704
|
|
|
101,264
|
|
|
(11,302
|
)
|
|
89,962
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Property operation and maintenance
|
|
6,374
|
|
|
(922
|
)
|
|
5,452
|
|
|
17,920
|
|
|
(2,595
|
)
|
|
15,325
|
|
||||||
Real estate taxes
|
|
5,253
|
|
|
(874
|
)
|
|
4,379
|
|
|
14,395
|
|
|
(2,135
|
)
|
|
12,260
|
|
||||||
Total property expenses
|
|
11,627
|
|
|
(1,796
|
)
|
|
9,831
|
|
|
32,315
|
|
|
(4,730
|
)
|
|
27,585
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other expenses (income)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
General and administrative
|
|
4,959
|
|
|
23
|
|
|
4,982
|
|
|
17,897
|
|
|
90
|
|
|
17,987
|
|
||||||
Depreciation and amortization
|
|
7,483
|
|
|
(1,006
|
)
|
|
6,477
|
|
|
22,100
|
|
|
(3,056
|
)
|
|
19,044
|
|
||||||
Equity in earnings of real estate partnership
|
|
—
|
|
|
(502
|
)
|
|
(502
|
)
|
|
—
|
|
|
(1,762
|
)
|
|
(1,762
|
)
|
||||||
Interest expense
|
|
6,951
|
|
|
(532
|
)
|
|
6,419
|
|
|
20,306
|
|
|
(1,601
|
)
|
|
18,705
|
|
||||||
Interest, dividend and other investment income
|
|
(84
|
)
|
|
(167
|
)
|
|
(251
|
)
|
|
(302
|
)
|
|
(490
|
)
|
|
(792
|
)
|
||||||
Total other expense
|
|
19,309
|
|
|
(2,184
|
)
|
|
17,125
|
|
|
60,001
|
|
|
(6,819
|
)
|
|
53,182
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income before gain (loss) on sale or disposal of properties or assets, income taxes, and profit sharing expense
|
|
3,660
|
|
|
88
|
|
|
3,748
|
|
|
8,948
|
|
|
247
|
|
|
9,195
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Provision for income taxes
|
|
(115
|
)
|
|
23
|
|
|
(92
|
)
|
|
(328
|
)
|
|
67
|
|
|
(261
|
)
|
||||||
Gain on sale of properties
|
|
4,380
|
|
|
—
|
|
|
4,380
|
|
|
4,646
|
|
|
(17
|
)
|
|
4,629
|
|
||||||
Profit sharing expense
|
|
(73
|
)
|
|
73
|
|
|
—
|
|
|
(276
|
)
|
|
276
|
|
|
—
|
|
||||||
Loss on sale or disposal of assets
|
|
(15
|
)
|
|
12
|
|
|
(3
|
)
|
|
(286
|
)
|
|
30
|
|
|
(256
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
|
7,837
|
|
|
196
|
|
|
8,033
|
|
|
12,704
|
|
|
603
|
|
|
13,307
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less: Net income attributable to noncontrolling interests
|
|
193
|
|
|
5
|
|
|
198
|
|
|
326
|
|
|
16
|
|
|
342
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income attributable to Whitestone REIT
|
|
$
|
7,644
|
|
|
$
|
191
|
|
|
$
|
7,835
|
|
|
$
|
12,378
|
|
|
$
|
587
|
|
|
$
|
12,965
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(in thousands, except per share data)
|
||||||||||||||||||||||||
|
|
Unaudited
Three Months Ended September 30, 2018 |
|
Unaudited
Nine Months Ended September 30, 2018 |
||||||||||||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.19
|
|
|
$
|
0.01
|
|
|
$
|
0.20
|
|
|
$
|
0.31
|
|
|
$
|
0.02
|
|
|
$
|
0.33
|
|
Diluted Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income attributable to common shareholders, excluding amounts attributable to unvested restricted shares
|
|
$
|
0.19
|
|
|
$
|
0.00
|
|
|
$
|
0.19
|
|
|
$
|
0.30
|
|
|
$
|
0.01
|
|
|
$
|
0.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Basic
|
|
39,327
|
|
|
—
|
|
|
39,327
|
|
|
39,200
|
|
|
—
|
|
|
39,200
|
|
||||||
Diluted
|
|
40,635
|
|
|
—
|
|
|
40,635
|
|
|
40,541
|
|
|
—
|
|
|
40,541
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Distributions declared per common share / OP unit
|
|
$
|
0.2850
|
|
|
$
|
—
|
|
|
$
|
0.2850
|
|
|
$
|
0.8550
|
|
|
$
|
—
|
|
|
$
|
0.8550
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
|
$
|
7,837
|
|
|
$
|
196
|
|
|
$
|
8,033
|
|
|
$
|
12,704
|
|
|
$
|
603
|
|
|
$
|
13,307
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive gain
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unrealized gain on cash flow hedging activities
|
|
605
|
|
|
—
|
|
|
605
|
|
|
4,163
|
|
|
—
|
|
|
4,163
|
|
||||||
Unrealized gain on available-for-sale marketable securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
18
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income
|
|
8,442
|
|
|
196
|
|
|
8,638
|
|
|
16,885
|
|
|
603
|
|
|
17,488
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less: Net income attributable to noncontrolling interests
|
|
193
|
|
|
5
|
|
|
198
|
|
|
326
|
|
|
16
|
|
|
342
|
|
||||||
Less: Comprehensive gain attributable to noncontrolling interests
|
|
15
|
|
|
—
|
|
|
15
|
|
|
107
|
|
|
—
|
|
|
107
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income attributable to Whitestone REIT
|
|
$
|
8,234
|
|
|
$
|
191
|
|
|
$
|
8,425
|
|
|
$
|
16,452
|
|
|
$
|
587
|
|
|
$
|
17,039
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands) |
||||||||||||
|
|
Unaudited
Three Months Ended March 31, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
3,234
|
|
|
$
|
35
|
|
|
$
|
3,269
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization
|
|
7,221
|
|
|
(947
|
)
|
|
6,274
|
|
|||
Amortization of deferred loan costs
|
|
327
|
|
|
(25
|
)
|
|
302
|
|
|||
Loss on sale of marketable securities
|
|
20
|
|
|
—
|
|
|
20
|
|
|||
Loss (gain) on sale or disposal of assets and properties
|
|
(69
|
)
|
|
—
|
|
|
(69
|
)
|
|||
Bad debt expense
|
|
478
|
|
|
(32
|
)
|
|
446
|
|
|||
Share-based compensation
|
|
1,845
|
|
|
—
|
|
|
1,845
|
|
|||
Equity in earnings of real estate partnership
|
|
—
|
|
|
(674
|
)
|
|
(674
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|||||
Escrows and acquisition deposits
|
|
3,414
|
|
|
(1,055
|
)
|
|
2,359
|
|
|||
Accrued rent and accounts receivable
|
|
(1,649
|
)
|
|
534
|
|
|
(1,115
|
)
|
|||
Receivable due from related party
|
|
—
|
|
|
110
|
|
|
110
|
|
|||
Distributions from real estate partnership
|
|
—
|
|
|
505
|
|
|
505
|
|
|||
Unamortized lease commissions
|
|
(493
|
)
|
|
90
|
|
|
(403
|
)
|
|||
Prepaid expenses and other assets
|
|
494
|
|
|
(57
|
)
|
|
437
|
|
|||
Accounts payable and accrued expenses
|
|
(8,828
|
)
|
|
1,531
|
|
|
(7,297
|
)
|
|||
Payable due to related party
|
|
—
|
|
|
(980
|
)
|
|
(980
|
)
|
|||
Tenants’ security deposits
|
|
143
|
|
|
(71
|
)
|
|
72
|
|
|||
Net cash provided by operating activities
|
|
6,137
|
|
|
(1,036
|
)
|
|
5,101
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
||||
Additions to real estate
|
|
(5,090
|
)
|
|
1,047
|
|
|
(4,043
|
)
|
|||
Proceeds from sales of properties
|
|
4,433
|
|
|
—
|
|
|
4,433
|
|
|||
Investment in real estate partnership
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from sales of marketable securities
|
|
30
|
|
|
—
|
|
|
30
|
|
|||
Net cash provided by (used in) investing activities
|
|
(627
|
)
|
|
1,047
|
|
|
420
|
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Distributions paid to common shareholders
|
|
(11,145
|
)
|
|
—
|
|
|
(11,145
|
)
|
|||
Distributions paid to OP unit holders
|
|
(309
|
)
|
|
—
|
|
|
(309
|
)
|
|||
Distributions paid to noncontrolling interest in Consolidated Partnership
|
|
(115
|
)
|
|
115
|
|
|
—
|
|
|||
Net proceeds from credit facility
|
|
9,000
|
|
|
—
|
|
|
9,000
|
|
|||
Repayments of notes payable
|
|
(903
|
)
|
|
325
|
|
|
(578
|
)
|
|||
Payments of loan origination costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Repurchase of common shares
|
|
(466
|
)
|
|
—
|
|
|
(466
|
)
|
|||
Net cash used in financing activities
|
|
(3,938
|
)
|
|
440
|
|
|
(3,498
|
)
|
|||
Net increase in cash, cash equivalents and restricted cash
|
|
1,572
|
|
|
451
|
|
|
2,023
|
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
|
8,022
|
|
|
(2,812
|
)
|
|
5,210
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
9,594
|
|
|
$
|
(2,361
|
)
|
|
$
|
7,233
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
Supplemental Disclosures
(in thousands) |
||||||||||||
|
|
Unaudited
Three Months Ended March 31, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
6,316
|
|
|
$
|
(510
|
)
|
|
$
|
5,806
|
|
Non cash investing and financing activities:
|
|
|
|
|
|
|
|
|||||
Financed insurance premiums
|
|
$
|
1,273
|
|
|
$
|
—
|
|
|
$
|
1,273
|
|
Value of shares issued under dividend reinvestment plan
|
|
$
|
33
|
|
|
$
|
—
|
|
|
$
|
33
|
|
Value of common shares exchanged for OP units
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Change in fair value of available-for-sale securities
|
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
18
|
|
Change in fair value of cash flow hedge
|
|
$
|
2,645
|
|
|
$
|
—
|
|
|
$
|
2,645
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands) |
||||||||||||
|
|
Unaudited
Six Months Ended June 30, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
4,867
|
|
|
$
|
407
|
|
|
$
|
5,274
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization
|
|
14,617
|
|
|
(2,050
|
)
|
|
12,567
|
|
|||
Amortization of deferred loan costs
|
|
653
|
|
|
(50
|
)
|
|
603
|
|
|||
Loss on sale of marketable securities
|
|
20
|
|
|
—
|
|
|
20
|
|
|||
Loss (gain) on sale or disposal of assets and properties
|
|
5
|
|
|
(1
|
)
|
|
4
|
|
|||
Bad debt expense
|
|
761
|
|
|
(99
|
)
|
|
662
|
|
|||
Share-based compensation
|
|
3,246
|
|
|
—
|
|
|
3,246
|
|
|||
Equity in earnings of real estate partnership
|
|
—
|
|
|
(1,260
|
)
|
|
(1,260
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|||||
Escrows and acquisition deposits
|
|
1,401
|
|
|
—
|
|
|
1,401
|
|
|||
Accrued rent and accounts receivable
|
|
15
|
|
|
(1
|
)
|
|
14
|
|
|||
Receivable due from related party
|
|
—
|
|
|
232
|
|
|
232
|
|
|||
Distributions from real estate partnership
|
|
—
|
|
|
505
|
|
|
505
|
|
|||
Unamortized lease commissions
|
|
(852
|
)
|
|
—
|
|
|
(852
|
)
|
|||
Prepaid expenses and other assets
|
|
504
|
|
|
2
|
|
|
506
|
|
|||
Accounts payable and accrued expenses
|
|
(6,370
|
)
|
|
(40
|
)
|
|
(6,410
|
)
|
|||
Payable due to related party
|
|
—
|
|
|
(612
|
)
|
|
(612
|
)
|
|||
Tenants’ security deposits
|
|
75
|
|
|
—
|
|
|
75
|
|
|||
Net cash provided by operating activities
|
|
18,942
|
|
|
(2,967
|
)
|
|
15,975
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
||||
Additions to real estate
|
|
(7,566
|
)
|
|
1,669
|
|
|
(5,897
|
)
|
|||
Proceeds from sales of properties
|
|
4,433
|
|
|
—
|
|
|
4,433
|
|
|||
Investment in real estate partnership
|
|
(649
|
)
|
|
649
|
|
|
—
|
|
|||
Proceeds from sales of marketable securities
|
|
30
|
|
|
—
|
|
|
30
|
|
|||
Net cash used in investing activities
|
|
(3,752
|
)
|
|
2,318
|
|
|
(1,434
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Distributions paid to common shareholders
|
|
(22,348
|
)
|
|
—
|
|
|
(22,348
|
)
|
|||
Distributions paid to OP unit holders
|
|
(604
|
)
|
|
—
|
|
|
(604
|
)
|
|||
Payments of exchange offer costs
|
|
(128
|
)
|
|
—
|
|
|
(128
|
)
|
|||
Net proceeds from credit facility
|
|
9,000
|
|
|
—
|
|
|
9,000
|
|
|||
Repayments of notes payable
|
|
(1,923
|
)
|
|
649
|
|
|
(1,274
|
)
|
|||
Repurchase of common shares
|
|
(1,059
|
)
|
|
—
|
|
|
(1,059
|
)
|
|||
Net cash used in financing activities
|
|
(17,062
|
)
|
|
649
|
|
|
(16,413
|
)
|
|||
Net decrease in cash, cash equivalents and restricted cash
|
|
(1,872
|
)
|
|
—
|
|
|
(1,872
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
|
5,210
|
|
|
—
|
|
|
5,210
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
3,338
|
|
|
$
|
—
|
|
|
$
|
3,338
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
Supplemental Disclosures
(in thousands) |
||||||||||||
|
|
Unaudited
Six Months Ended June 30, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
12,377
|
|
|
$
|
(1,022
|
)
|
|
$
|
11,355
|
|
Cash paid for taxes
|
|
$
|
392
|
|
|
$
|
(88
|
)
|
|
$
|
304
|
|
Non cash investing and financing activities:
|
|
|
|
|
|
|
|
|||||
Disposal of fully depreciated real estate
|
|
$
|
960
|
|
|
$
|
(56
|
)
|
|
$
|
904
|
|
Financed insurance premiums
|
|
$
|
1,273
|
|
|
$
|
—
|
|
|
$
|
1,273
|
|
Value of shares issued under dividend reinvestment plan
|
|
$
|
66
|
|
|
$
|
—
|
|
|
$
|
66
|
|
Value of common shares exchanged for OP units
|
|
$
|
752
|
|
|
$
|
—
|
|
|
$
|
752
|
|
Change in fair value of available-for-sale securities
|
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
18
|
|
Change in fair value of cash flow hedge
|
|
$
|
3,558
|
|
|
$
|
—
|
|
|
$
|
3,558
|
|
Reallocation of ownership percentage between parent and subsidiary
|
|
$
|
12
|
|
|
$
|
—
|
|
|
$
|
12
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands) |
||||||||||||
|
|
Unaudited
Nine Months Ended September 30, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
12,704
|
|
|
$
|
603
|
|
|
$
|
13,307
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation and amortization
|
|
22,100
|
|
|
(3,056
|
)
|
|
19,044
|
|
|||
Amortization of deferred loan costs
|
|
976
|
|
|
(74
|
)
|
|
902
|
|
|||
Loss on sale of marketable securities
|
|
20
|
|
|
—
|
|
|
20
|
|
|||
Loss (gain) on sale or disposal of assets and properties
|
|
(4,360
|
)
|
|
(13
|
)
|
|
(4,373
|
)
|
|||
Bad debt expense
|
|
1,123
|
|
|
(153
|
)
|
|
970
|
|
|||
Share-based compensation
|
|
4,894
|
|
|
—
|
|
|
4,894
|
|
|||
Equity in earnings of real estate partnership
|
|
—
|
|
|
(1,762
|
)
|
|
(1,762
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|||||
Escrows and acquisition deposits
|
|
214
|
|
|
—
|
|
|
214
|
|
|||
Accrued rent and accounts receivable
|
|
(1,736
|
)
|
|
12
|
|
|
(1,724
|
)
|
|||
Receivable due from related party
|
|
—
|
|
|
696
|
|
|
696
|
|
|||
Distributions from real estate partnership
|
|
—
|
|
|
505
|
|
|
505
|
|
|||
Unamortized lease commissions
|
|
(1,394
|
)
|
|
(2
|
)
|
|
(1,396
|
)
|
|||
Prepaid expenses and other assets
|
|
618
|
|
|
1
|
|
|
619
|
|
|||
Accounts payable and accrued expenses
|
|
(2,924
|
)
|
|
(55
|
)
|
|
(2,979
|
)
|
|||
Accounts payable due to related party
|
|
—
|
|
|
(403
|
)
|
|
(403
|
)
|
|||
Tenants’ security deposits
|
|
226
|
|
|
—
|
|
|
226
|
|
|||
Net cash provided by operating activities
|
|
32,461
|
|
|
(3,701
|
)
|
|
28,760
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
||||
Acquisitions of real estate
|
|
—
|
|
|
—
|
|
|
|
||||
Additions to real estate
|
|
(11,300
|
)
|
|
2,567
|
|
|
(8,733
|
)
|
|||
Proceeds from sales of properties
|
|
12,574
|
|
|
—
|
|
|
12,574
|
|
|||
Proceeds from financed receivable due from related party
|
|
—
|
|
|
1,000
|
|
|
1,000
|
|
|||
Investment in real estate partnership
|
|
843
|
|
|
(843
|
)
|
|
—
|
|
|||
Proceeds from sales of marketable securities
|
|
30
|
|
|
—
|
|
|
30
|
|
|||
Net cash provided by investing activities
|
|
2,147
|
|
|
2,724
|
|
|
4,871
|
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Distributions paid to common shareholders
|
|
(33,642
|
)
|
|
—
|
|
|
(33,642
|
)
|
|||
Distributions paid to OP unit holders
|
|
(890
|
)
|
|
—
|
|
|
(890
|
)
|
|||
Payments of exchange offer costs
|
|
(128
|
)
|
|
—
|
|
|
(128
|
)
|
|||
Net proceeds from credit facility
|
|
9,000
|
|
|
—
|
|
|
9,000
|
|
|||
Repayments of notes payable
|
|
(2,949
|
)
|
|
977
|
|
|
(1,972
|
)
|
|||
Payments of loan origination costs
|
|
(30
|
)
|
|
—
|
|
|
(30
|
)
|
|||
Repurchase of common shares
|
|
(1,699
|
)
|
|
—
|
|
|
(1,699
|
)
|
|||
Net cash used in financing activities
|
|
(30,338
|
)
|
|
977
|
|
|
(29,361
|
)
|
|||
Net increase in cash, cash equivalents and restricted cash
|
|
4,270
|
|
|
—
|
|
|
4,270
|
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
|
5,210
|
|
|
—
|
|
|
5,210
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
9,480
|
|
|
$
|
—
|
|
|
$
|
9,480
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
Supplemental Disclosures
(in thousands) |
||||||||||||
|
|
Unaudited
Nine Months Ended September 30, 2018 |
||||||||||
|
|
Previously Reported
(1)
|
|
Adjustments
|
|
Restated
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
19,879
|
|
|
$
|
(1,698
|
)
|
|
$
|
18,181
|
|
Cash paid for taxes
|
|
$
|
392
|
|
|
$
|
(88
|
)
|
|
$
|
304
|
|
Non cash investing and financing activities:
|
|
|
|
|
|
|
|
|||||
Disposal of fully depreciated real estate
|
|
$
|
963
|
|
|
$
|
(59
|
)
|
|
$
|
904
|
|
Financed insurance premiums
|
|
$
|
1,273
|
|
|
$
|
—
|
|
|
$
|
1,273
|
|
Value of shares issued under dividend reinvestment plan
|
|
$
|
101
|
|
|
$
|
—
|
|
|
$
|
101
|
|
Value of common shares exchanged for OP units
|
|
$
|
1,545
|
|
|
$
|
—
|
|
|
$
|
1,545
|
|
Change in fair value of available-for-sale securities
|
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
18
|
|
Change in fair value of cash flow hedge
|
|
$
|
4,163
|
|
|
$
|
—
|
|
|
$
|
4,163
|
|
Reallocation of ownership percentage between parent and subsidiary
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
24
|
|
•
|
$250.0 million
unsecured revolving credit facility with a maturity date of January 1, 2023 (the “2019 Revolver”);
|
•
|
$165.0 million
unsecured term loan with a maturity date of January 31, 2024 (“Term Loan A”); and
|
•
|
$100.0 million
unsecured term loan with a maturity date of October 30, 2022 (“Term Loan B” and together with Term Loan A, the “2019 Term Loans”).
|
•
|
maximum total indebtedness to total asset value ratio of
0.60
to 1.00;
|
•
|
maximum secured debt to total asset value ratio of
0.40
to 1.00;
|
•
|
minimum EBITDA (earnings before interest, taxes, depreciation, amortization or extraordinary items) to fixed charges ratio of
1.50
to 1.00;
|
•
|
maximum other recourse debt to total asset value ratio of
0.15
to 1.00; and
|
•
|
maintenance of a minimum tangible net worth (adjusted for accumulated depreciation and amortization) of
$372 million
plus
75%
of the net proceeds from additional equity offerings (as defined).
|
|
|
(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, 2018
|
|
$
|
8,608
|
|
|
$
|
1,391
|
|
|
$
|
(253
|
)
|
|
$
|
9,746
|
|
Year ended December 31, 2017
|
|
7,133
|
|
|
2,340
|
|
|
(865
|
)
|
|
8,608
|
|
||||
Year ended December 31, 2016
|
|
6,647
|
|
|
1,585
|
|
|
(1,099
|
)
|
|
7,133
|
|
|
|
|
|
|
|
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
|
||||||||||||||||
Whitestone Properties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Ahwatukee Plaza
|
|
$
|
5,126
|
|
|
$
|
4,086
|
|
|
$
|
320
|
|
|
$
|
—
|
|
|
$
|
5,126
|
|
|
$
|
4,406
|
|
|
$
|
9,532
|
|
||
Anthem Marketplace
|
|
4,790
|
|
|
17,973
|
|
|
1,132
|
|
|
—
|
|
|
4,790
|
|
|
19,105
|
|
|
23,895
|
|
|||||||||
Bissonnet Beltway
|
|
415
|
|
|
1,947
|
|
|
469
|
|
|
—
|
|
|
415
|
|
|
2,416
|
|
|
2,831
|
|
|||||||||
BLVD Place
|
|
63,893
|
|
|
90,942
|
|
|
513
|
|
|
—
|
|
|
63,893
|
|
|
91,455
|
|
|
155,348
|
|
|||||||||
The Citadel
|
|
472
|
|
|
1,777
|
|
|
2,614
|
|
|
—
|
|
|
472
|
|
|
4,391
|
|
|
4,863
|
|
|||||||||
City View Village
|
|
2,044
|
|
|
4,149
|
|
|
98
|
|
|
—
|
|
|
2,044
|
|
|
4,247
|
|
|
6,291
|
|
|||||||||
Davenport Village
|
|
11,367
|
|
|
34,101
|
|
|
1,241
|
|
|
—
|
|
|
11,367
|
|
|
35,342
|
|
|
46,709
|
|
|||||||||
Desert Canyon
|
|
1,976
|
|
|
1,704
|
|
|
1,796
|
|
|
—
|
|
|
1,976
|
|
|
3,500
|
|
|
5,476
|
|
|||||||||
Eldorado Plaza
|
|
16,551
|
|
|
30,746
|
|
|
264
|
|
|
—
|
|
|
16,551
|
|
|
31,010
|
|
|
47,561
|
|
|||||||||
Fountain Hills Plaza
|
|
5,113
|
|
|
15,340
|
|
|
215
|
|
|
—
|
|
|
5,113
|
|
|
15,555
|
|
|
20,668
|
|
|||||||||
Fountain Square
|
|
5,573
|
|
|
9,828
|
|
|
2,289
|
|
|
—
|
|
|
5,573
|
|
|
12,117
|
|
|
17,690
|
|
|||||||||
Fulton Ranch Towne Center
|
|
7,604
|
|
|
22,612
|
|
|
2,226
|
|
|
—
|
|
|
7,604
|
|
|
24,838
|
|
|
32,442
|
|
|||||||||
Gilbert Tuscany Village
|
|
1,767
|
|
|
3,233
|
|
|
1,591
|
|
|
—
|
|
|
1,767
|
|
|
4,824
|
|
|
6,591
|
|
|||||||||
Gilbert Tuscany Village Hard Corner
|
|
856
|
|
|
794
|
|
|
168
|
|
|
—
|
|
|
856
|
|
|
962
|
|
|
1,818
|
|
|||||||||
Heritage Trace Plaza
|
|
6,209
|
|
|
13,821
|
|
|
377
|
|
|
—
|
|
|
6,209
|
|
|
14,198
|
|
|
20,407
|
|
|||||||||
Headquarters Village
|
|
7,171
|
|
|
18,439
|
|
|
1,002
|
|
|
—
|
|
|
7,171
|
|
|
19,441
|
|
|
26,612
|
|
|||||||||
Keller Place
|
|
5,977
|
|
|
7,577
|
|
|
703
|
|
|
—
|
|
|
5,977
|
|
|
8,280
|
|
|
14,257
|
|
|||||||||
Kempwood Plaza
|
|
733
|
|
|
1,798
|
|
|
1,989
|
|
|
—
|
|
|
733
|
|
|
3,787
|
|
|
4,520
|
|
|||||||||
La Mirada
|
|
12,853
|
|
|
24,464
|
|
|
834
|
|
|
—
|
|
|
12,853
|
|
|
25,298
|
|
|
38,151
|
|
|||||||||
Lion Square
|
|
1,546
|
|
|
4,289
|
|
|
4,455
|
|
|
—
|
|
|
1,546
|
|
|
8,744
|
|
|
10,290
|
|
|||||||||
The Marketplace at Central
|
|
1,305
|
|
|
5,324
|
|
|
1,330
|
|
|
—
|
|
|
1,305
|
|
|
6,654
|
|
|
7,959
|
|
|||||||||
Market Street at DC Ranch
|
|
9,710
|
|
|
26,779
|
|
|
4,876
|
|
|
—
|
|
|
9,710
|
|
|
31,655
|
|
|
41,365
|
|
|||||||||
Mercado at Scottsdale Ranch
|
|
8,728
|
|
|
12,560
|
|
|
1,548
|
|
|
—
|
|
|
8,728
|
|
|
14,108
|
|
|
22,836
|
|
|||||||||
Paradise Plaza
|
|
6,155
|
|
|
10,221
|
|
|
1,266
|
|
|
—
|
|
|
6,155
|
|
|
11,487
|
|
|
17,642
|
|
|||||||||
Parkside Village North
|
|
3,877
|
|
|
8,629
|
|
|
199
|
|
|
—
|
|
|
3,877
|
|
|
8,828
|
|
|
12,705
|
|
|||||||||
Parkside Village South
|
|
5,562
|
|
|
27,154
|
|
|
160
|
|
|
—
|
|
|
5,562
|
|
|
27,314
|
|
|
32,876
|
|
|||||||||
Pima Norte
|
|
1,086
|
|
|
7,162
|
|
|
2,149
|
|
|
517
|
|
|
1,086
|
|
—
|
|
9,828
|
|
—
|
|
10,914
|
|
|||||||
Pinnacle of Scottsdale
|
|
6,648
|
|
|
22,466
|
|
|
1,665
|
|
|
—
|
|
|
6,648
|
|
|
24,131
|
|
|
30,779
|
|
|||||||||
Pinnacle of Scottsdale Phase II
|
|
883
|
|
|
4,659
|
|
|
1,998
|
|
|
592
|
|
|
883
|
|
—
|
|
7,249
|
|
—
|
|
8,132
|
|
|||||||
The Promenade at Fulton Ranch
|
|
5,198
|
|
|
13,367
|
|
|
661
|
|
|
—
|
|
|
5,198
|
|
|
14,028
|
|
|
19,226
|
|
|||||||||
Providence
|
|
918
|
|
|
3,675
|
|
|
2,321
|
|
|
—
|
|
|
918
|
|
|
5,996
|
|
|
6,914
|
|
|||||||||
Quinlan Crossing
|
|
9,561
|
|
|
28,683
|
|
|
640
|
|
|
—
|
|
|
9,561
|
|
|
29,323
|
|
|
38,884
|
|
|||||||||
Seville
|
|
6,913
|
|
|
25,518
|
|
|
567
|
|
|
—
|
|
|
6,913
|
|
|
26,085
|
|
|
32,998
|
|
|||||||||
Shaver
|
|
184
|
|
|
633
|
|
|
82
|
|
|
—
|
|
|
184
|
|
|
715
|
|
|
899
|
|
|||||||||
Shops at Pecos Ranch
|
|
3,781
|
|
|
15,123
|
|
|
744
|
|
|
—
|
|
|
3,781
|
|
|
15,867
|
|
|
19,648
|
|
|||||||||
Shops at Starwood
|
|
4,093
|
|
|
11,487
|
|
|
415
|
|
|
—
|
|
|
4,093
|
|
|
11,902
|
|
|
15,995
|
|
|||||||||
Shops at Starwood Phase III
|
|
1,818
|
|
|
7,069
|
|
|
2,045
|
|
|
1,097
|
|
|
1,818
|
|
|
10,211
|
|
|
12,029
|
|
|||||||||
The Shops at Williams Trace
|
|
5,920
|
|
|
14,297
|
|
|
599
|
|
|
—
|
|
|
5,920
|
|
|
14,896
|
|
|
20,816
|
|
|||||||||
South Richey
|
|
778
|
|
|
2,584
|
|
|
1,917
|
|
|
—
|
|
|
778
|
|
|
4,501
|
|
|
5,279
|
|
|||||||||
Spoerlein Commons
|
|
2,340
|
|
|
7,296
|
|
|
840
|
|
|
—
|
|
|
2,340
|
|
|
8,136
|
|
|
10,476
|
|
|||||||||
The Strand at Huebner Oaks
|
|
5,805
|
|
|
12,335
|
|
|
383
|
|
|
—
|
|
|
5,805
|
|
|
12,718
|
|
|
18,523
|
|
|||||||||
SugarPark Plaza
|
|
1,781
|
|
|
7,125
|
|
|
1,059
|
|
|
—
|
|
|
1,781
|
|
|
8,184
|
|
|
9,965
|
|
|||||||||
Sunridge
|
|
276
|
|
|
1,186
|
|
|
606
|
|
|
—
|
|
|
276
|
|
|
1,792
|
|
|
2,068
|
|
|||||||||
Sunset at Pinnacle Peak
|
|
3,610
|
|
|
2,734
|
|
|
736
|
|
|
—
|
|
|
3,610
|
|
|
3,470
|
|
|
7,080
|
|
|||||||||
Terravita Marketplace
|
|
7,171
|
|
|
9,392
|
|
|
992
|
|
|
—
|
|
|
7,171
|
|
|
10,384
|
|
|
17,555
|
|
|||||||||
Town Park
|
|
850
|
|
|
2,911
|
|
|
403
|
|
|
—
|
|
|
850
|
|
|
3,314
|
|
|
4,164
|
|
|||||||||
Village Square at Dana Park
|
|
10,877
|
|
|
40,250
|
|
|
3,331
|
|
|
—
|
|
|
10,877
|
|
|
43,581
|
|
|
54,458
|
|
|||||||||
Westchase
|
|
423
|
|
|
1,751
|
|
|
3,270
|
|
|
—
|
|
|
423
|
|
|
5,021
|
|
|
5,444
|
|
|
|
|
|
|
|
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
|
||||||||||||||||
Williams Trace Plaza
|
|
6,800
|
|
|
14,003
|
|
|
381
|
|
|
—
|
|
|
6,800
|
|
|
14,384
|
|
|
21,184
|
|
|||||||||
Windsor Park
|
|
2,621
|
|
|
10,482
|
|
|
8,490
|
|
|
—
|
|
|
2,621
|
|
|
18,972
|
|
|
21,593
|
|
|||||||||
Woodlake Plaza
|
|
1,107
|
|
|
4,426
|
|
|
2,543
|
|
|
—
|
|
|
1,107
|
|
|
6,969
|
|
|
8,076
|
|
|||||||||
Total Whitestone Properties
|
|
$
|
288,815
|
|
|
$
|
670,901
|
|
|
$
|
72,512
|
|
|
$
|
2,206
|
|
|
$
|
288,815
|
|
|
$
|
745,619
|
|
|
$
|
1,034,434
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Land Held for Development:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Anthem Marketplace
|
|
$
|
204
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
204
|
|
|
$
|
—
|
|
|
$
|
204
|
|
||
BLVD Place Phase II-B
|
|
10,500
|
|
|
—
|
|
|
1,155
|
|
|
—
|
|
|
10,500
|
|
|
1,155
|
|
|
11,655
|
|
|||||||||
Dana Park Development
|
|
4,000
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
4,000
|
|
|
25
|
|
|
4,025
|
|
|||||||||
Eldorado Plaza Development
|
|
911
|
|
|
—
|
|
|
28
|
|
|
—
|
|
|
911
|
|
|
28
|
|
|
939
|
|
|||||||||
Fountain Hills
|
|
277
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
277
|
|
|
—
|
|
|
277
|
|
|||||||||
Market Street at DC Ranch
|
|
704
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
704
|
|
|
—
|
|
|
704
|
|
|||||||||
Total - Land Held for Development
|
|
$
|
16,596
|
|
|
$
|
—
|
|
|
$
|
1,208
|
|
|
$
|
—
|
|
|
$
|
16,596
|
|
|
$
|
1,208
|
|
|
$
|
17,804
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Grand Totals - Whitestone Properties
|
|
$
|
305,411
|
|
|
$
|
670,901
|
|
|
$
|
73,720
|
|
|
$
|
2,206
|
|
|
$
|
305,411
|
|
|
$
|
746,827
|
|
—
|
|
$
|
1,052,238
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Depreciation
|
|
Date of
|
|
Date
|
|
Depreciation
|
||
Property Name
|
|
Encumbrances
|
|
(in thousands)
|
|
Construction
|
|
Acquired
|
|
Life
|
||
Whitestone Properties:
|
|
|
|
|
|
|
|
|
|
|
||
Ahwatukee Plaza
|
|
|
|
$
|
823
|
|
|
|
|
8/16/2011
|
|
5-39 years
|
Anthem Marketplace
|
|
(4)
|
|
2,659
|
|
|
|
|
6/28/2013
|
|
5-39 years
|
|
Bissonnet Beltway
|
|
|
|
1,866
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
BLVD Place
|
|
(5)
|
|
3,740
|
|
|
|
|
5/26/2017
|
|
5-39 years
|
|
The Citadel
|
|
|
|
1,757
|
|
|
|
|
9/28/2010
|
|
5-39 years
|
|
City View Village
|
|
|
|
415
|
|
|
|
|
3/31/2015
|
|
5-39 years
|
|
Davenport Village
|
|
|
|
3,498
|
|
|
|
|
5/27/2015
|
|
5-39 years
|
|
Desert Canyon
|
|
|
|
638
|
|
|
|
|
4/13/2011
|
|
5-39 years
|
|
Eldorado Plaza
|
|
|
|
1,257
|
|
|
|
|
5/3/2017
|
|
5-39 years
|
|
Fountain Hills Plaza
|
|
|
|
2,167
|
|
|
|
|
10/7/2013
|
|
5-39 years
|
|
Fountain Square
|
|
|
|
2,293
|
|
|
|
|
9/21/2012
|
|
5-39 years
|
|
Fulton Ranch Towne Center
|
|
|
|
2,561
|
|
|
|
|
11/5/2014
|
|
5-39 years
|
|
Gilbert Tuscany Village
|
|
|
|
1,453
|
|
|
|
|
6/28/2011
|
|
5-39 years
|
|
Gilbert Tuscany Village Hard Corner
|
|
|
|
75
|
|
|
|
|
8/28/2015
|
|
5-39 years
|
|
Heritage Trace Plaza
|
|
|
|
1,713
|
|
|
|
|
7/1/2014
|
|
5-39 years
|
|
Headquarters Village
|
|
(6)
|
|
3,082
|
|
|
|
|
3/28/2013
|
|
5-39 years
|
|
Keller Place
|
|
|
|
715
|
|
|
|
|
8/26/2015
|
|
5-39 years
|
|
Kempwood Plaza
|
|
|
|
1,592
|
|
|
|
|
2/2/1999
|
|
5-39 years
|
|
La Mirada
|
|
|
|
1,484
|
|
|
|
|
9/30/2016
|
|
5-39 years
|
|
Lion Square
|
|
|
|
4,691
|
|
|
|
|
1/1/2000
|
|
5-39 years
|
|
The Marketplace at Central
|
|
|
|
1,698
|
|
|
|
|
11/1/2010
|
|
5-39 years
|
|
Market Street at DC Ranch
|
|
|
|
5,348
|
|
|
|
|
12/5/2013
|
|
5-39 years
|
|
Mercado at Scottsdale Ranch
|
|
|
|
2,100
|
|
|
|
|
6/19/2013
|
|
5-39 years
|
|
Paradise Plaza
|
|
|
|
2,097
|
|
|
|
|
8/8/2012
|
|
5-39 years
|
|
Parkside Village North
|
|
|
|
814
|
|
|
|
|
7/2/2015
|
|
5-39 years
|
|
Parkside Village South
|
|
|
|
2,479
|
|
|
|
|
7/2/2015
|
|
5-39 years
|
|
Pima Norte
|
|
|
|
2,822
|
|
|
|
|
10/4/2007
|
|
5-39 years
|
|
Pinnacle of Scottsdale
|
|
(7)
|
|
4,648
|
|
|
|
|
12/22/2011
|
|
5-39 years
|
|
Pinnacle of Scottsdale Phase II
|
|
|
|
598
|
|
|
3/31/2017
|
|
|
|
5-39 years
|
|
The Promenade at Fulton Ranch
|
|
|
|
1,475
|
|
|
|
|
11/5/2014
|
|
5-39 years
|
|
Providence
|
|
|
|
2,261
|
|
|
|
|
3/30/2001
|
|
5-39 years
|
|
Quinlan Crossing
|
|
|
|
2,525
|
|
|
|
|
8/26/2015
|
|
5-39 years
|
|
Seville
|
|
|
|
1,541
|
|
|
|
|
9/30/2016
|
|
5-39 years
|
|
Shaver
|
|
|
|
358
|
|
|
|
|
12/17/1999
|
|
5-39 years
|
|
Shops at Pecos Ranch
|
|
(8)
|
|
2,608
|
|
|
|
|
12/28/2012
|
|
5-39 years
|
|
Shops at Starwood
|
|
(9)
|
|
2,250
|
|
|
|
|
12/28/2011
|
|
5-39 years
|
|
Shops at Starwood Phase III
|
|
|
|
652
|
|
|
12/31/2016
|
|
|
|
5-39 years
|
|
The Shops at Williams Trace
|
|
|
|
1,590
|
|
|
|
|
12/24/2014
|
|
5-39 years
|
|
South Richey
|
|
|
|
2,319
|
|
|
|
|
8/25/1999
|
|
5-39 years
|
|
Spoerlein Commons
|
|
|
|
2,116
|
|
|
|
|
1/16/2009
|
|
5-39 years
|
|
The Strand at Huebner Oaks
|
|
|
|
1,486
|
|
|
|
|
9/19/2014
|
|
5-39 years
|
|
SugarPark Plaza
|
|
|
|
3,010
|
|
|
|
|
9/8/2004
|
|
5-39 years
|
|
Sunridge
|
|
|
|
886
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
Sunset at Pinnacle Peak
|
|
|
|
729
|
|
|
|
|
5/29/2012
|
|
5-39 years
|
|
Terravita Marketplace
|
|
(10)
|
|
2,002
|
|
|
|
|
8/8/2011
|
|
5-39 years
|
|
Town Park
|
|
|
|
2,086
|
|
|
|
|
1/1/1999
|
|
5-39 years
|
|
Village Square at Dana Park
|
|
(11)
|
|
7,421
|
|
|
|
|
9/21/2012
|
|
5-39 years
|
|
Westchase
|
|
|
|
2,130
|
|
|
|
|
1/1/2002
|
|
5-39 years
|
|
|
|
|
Accumulated Depreciation
|
|
Date of
|
|
Date
|
|
Depreciation
|
||
Property Name
|
|
Encumbrances
|
|
(in thousands)
|
|
Construction
|
|
Acquired
|
|
Life
|
||
Williams Trace Plaza
|
|
|
|
1,519
|
|
|
|
|
12/24/2014
|
|
5-39 years
|
|
Windsor Park
|
|
|
|
8,638
|
|
|
|
|
12/16/2003
|
|
5-39 years
|
|
Woodlake Plaza
|
|
(12)
|
|
2,615
|
|
|
|
|
3/14/2005
|
|
5-39 years
|
|
|
|
|
|
$
|
113,300
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Land Held for Development:
|
|
|
|
|
|
|
|
|
|
|
||
Anthem Marketplace
|
|
|
|
$
|
—
|
|
|
|
|
6/28/2013
|
|
Land - Not Depreciated
|
BLVD Place Phase II-B
|
|
|
|
—
|
|
|
|
|
5/26/2017
|
|
Land - Not Depreciated
|
|
Dana Park Development
|
|
|
|
—
|
|
|
|
|
9/21/2012
|
|
Land - Not Depreciated
|
|
Eldorado Plaza Development
|
|
|
|
—
|
|
|
|
|
12/29/2017
|
|
Land - Not Depreciated
|
|
Fountain Hills
|
|
|
|
—
|
|
|
|
|
10/7/2013
|
|
Land - Not Depreciated
|
|
Market Street at DC Ranch
|
|
|
|
—
|
|
|
|
|
12/5/2013
|
|
Land - Not Depreciated
|
|
Total - Land Held For Development
|
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Grand Totals - Whitestone Properties
|
|
|
|
$
|
113,300
|
|
|
|
|
|
|
|
(1)
|
Reconciliations of total real estate carrying value for the three years ended December 31, follows:
|
|
|
( in thousands)
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Balance at beginning of period
|
|
$
|
1,149,454
|
|
|
$
|
920,310
|
|
|
$
|
835,538
|
|
Cumulative effect of accounting change for adoption of ASU 2017-05.
|
|
(95,146
|
)
|
|
—
|
|
|
—
|
|
|||
Additions during the period:
|
|
|
|
|
|
|
|
|
|
|||
Acquisitions
|
|
—
|
|
|
213,545
|
|
|
69,749
|
|
|||
Improvements
|
|
11,638
|
|
|
17,575
|
|
|
22,036
|
|
|||
|
|
(83,508
|
)
|
|
231,120
|
|
|
91,785
|
|
|||
Deductions - cost of real estate sold or retired
|
|
(13,708
|
)
|
|
(1,976
|
)
|
|
(7,013
|
)
|
|||
Balance at close of period
|
|
$
|
1,052,238
|
|
|
$
|
1,149,454
|
|
|
$
|
920,310
|
|
(2)
|
The aggregate cost of real estate (in thousands) for federal income tax purposes is
$1,019,001
.
|
(3)
|
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.
|
(4)
|
This property secures a
$15.1 million
mortgage note.
|
(5)
|
This property secures a
$80.0 million
mortgage note.
|
(6)
|
This property secures a
$19.0 million
mortgage note.
|
(7)
|
This property secures a
$14.1 million
mortgage note.
|
(8)
|
This property secures a
$14.0 million
mortgage note.
|
(9)
|
This property secures a
$14.3 million
mortgage note.
|
(10)
|
This property secures a
$10.5 million
mortgage note.
|
(11)
|
This property secures a
$2.6 million
mortgage note.
|
(12)
|
This property secures a
$6.5 million
mortgage note.
|
(13)
|
These properties secure a
$37.0 million
mortgage note.
|
(14)
|
This property secures a
$16.5 million
mortgage note.
|
NAME OF SUBSIDIARY
|
JURISDICTION OF FORMATION
|
Whitestone REIT Operating Partnership, LP
|
Delaware
|
Pillarstone Capital REIT Operating Partnership LP
|
Delaware
|
Whitestone Centers LLC
|
Texas
|
Whitestone REIT Operating Partnership III GP, LLC
|
Texas
|
Whitestone REIT Operating Partnership III LP, LTD
|
Texas
|
Whitestone REIT Operating Partnership III LP
|
Texas
|
Whitestone REIT Operating Company IV, LLC
|
Texas
|
Whitestone Pima Norte LLC
|
Texas
|
Whitestone Corporate Park West 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 Terravita Marketplace, LLC
|
Delaware
|
Whitestone Ahwatukee Plaza, LLC
|
Delaware
|
Whitestone Brokerage Services AZ, LLC
|
Arizona
|
Whitestone Pinnacle of Scottsdale, LLC
|
Delaware
|
Whitestone Pinnacle of Scottsdale - Phase II, LLC
|
Delaware
|
Whitestone Shops At Starwood, LLC
|
Delaware
|
Whitestone Shops At Starwood - Phase III, LLC
|
Delaware
|
Whitestone Shops at Pinnacle, LLC
|
Delaware
|
Whitestone Paradise Village, LLC
|
Delaware
|
Whitestone Fountain Square, LLC
|
Delaware
|
Whitestone Village Square at Dana Park, LLC
|
Delaware
|
Whitestone Village Square at Dana Park Development Land, LLC
|
Delaware
|
Whitestone Pecos Ranch, LLC
|
Delaware
|
Whitestone Headquarters Village, LLC
|
Delaware
|
Whitestone TRS, Inc.
|
Delaware
|
Whitestone Mercado, LLC
|
Delaware
|
Whitestone Realty, LLC
|
Arizona
|
Whitestone Anthem Marketplace, LLC
|
Delaware
|
Whitestone Anthem Marketplace Development Land, LLC
|
Delaware
|
Whitestone Fountain Hills, LLC
|
Delaware
|
Whitestone Woodlake Plaza, LLC
|
Delaware
|
Whitestone Market Street at DC Ranch, LLC
|
Delaware
|
Whitestone Heritage Trace Plaza 1, LLC
|
Delaware
|
Whitestone Heritage Trace Plaza 2, LLC
|
Delaware
|
Whitestone Strand, LLC
|
Delaware
|
Whitestone Promenade, LLC
|
Delaware
|
Whitestone Towne Center, LLC
|
Delaware
|
Whitestone Williams Trace Plaza, LLC
|
Delaware
|
Whitestone Williams Trace Shops, LLC
|
Delaware
|
Whitestone Clear Lake Offices, LLC
|
Delaware
|
Whitestone Towne Center Corner, LLC
|
Delaware
|
Whitestone Village Square at Dana Park Corner, LLC
|
Delaware
|
Whitestone City View, LLC
|
Delaware
|
Whitestone Davenport TRS, LLC
|
Delaware
|
Whitestone Davenport Village, LLC
|
Delaware
|
Whitestone Parkside Village South, LLC
|
Delaware
|
Whitestone Parkside Village North, LLC
|
Delaware
|
Whitestone Quinlan Crossing, LLC
|
Delaware
|
Whitestone Keller Place, LLC
|
Delaware
|
Whitestone Gilbert Tuscany Village Corner, LLC
|
Delaware
|
1.
|
I have reviewed this annual report on Form 10-K, for the period ended
December 31, 2018
, 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, for the period ended
December 31, 2018
, 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.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ James C. Mastandrea
|
James C. Mastandrea
|
Chairman and Chief Executive Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ David K. Holeman
|
David K. Holeman
|
Chief Financial Officer
|