Arbor Realty Trust Reports First Quarter 2009 Results
First Quarter Highlights:
- Exchanged
$247.1 million of trust preferred securities for$268.4 million of newly issued notes inMay 2009 , reducing the interest rate to 0.50% per annum for three years
UNIONDALE, N.Y.,
In
As previously disclosed, in
The Company owned its 16.67% interest through a consolidated entity which had a 25% interest in Prime Outlets with a third party member owning the remaining 8.33%. Through this consolidated entity, the Company recorded in its first quarter 2009 financial statements an investment of approximately
During the first quarter of 2009, the Company purchased, at a discount, approximately
During the quarter, the Company recorded
The net balance in the loan and investment portfolio, excluding loan loss reserves, was
At
For the first quarter of 2009,
Financing Activity
As of
In
During the quarter, the Company reduced its outstanding warehouse and term debt outstanding balances by approximately
The Company is subject to various financial covenants and restrictions by each of the Company's CDO and credit facilities. Based on the unaudited financial statements in this release, the Company believes that it was in compliance with all credit facility financial covenants and restrictions as of
Portfolio Activity
During the quarter, 5 loans paid off on properties that were either sold or refinanced outside of Arbor with an outstanding balance of approximately
Additionally, one loan totaling approximately
No loans were originated during the quarter.
At
As of
During the first quarter of 2009, the Company recorded
In the first quarter of 2009, the Company received
The Company had nine non-performing loans with a carrying value of approximately
Dividend
The Board of Directors and the Company have elected not to pay a common stock dividend for the quarter ended
Equity Participation Interests
Attached as an exhibit to this press release is a schedule of certain data pertaining to the Company's investments with equity participation interests. As previously mentioned, the Company transferred 16.67% of its 24.17% interest in Prime at a value of
Earnings Conference Call
Management will host a conference call today at
After the live webcast, the call will remain available on Arbor's Web site, www.arborrealtytrust.com through
About
Safe Harbor Statement
Certain items in this press release may constitute forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Arbor can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Arbor's expectations include, but are not limited to, continued ability
to source new investments, changes in interest rates and/or credit spreads, changes in the real estate markets, and other risks detailed in Arbor's Annual Report on Form 10-K for the year ended
Contact:
Arbor Realty Trust, Inc.
Investor Relations
516-506-4200
InvestorRelations@arbor.com
Non-GAAP Financial Measures
During the quarterly earnings conference call, the Company may discuss non-GAAP financial measures as defined by SEC Regulation G. In addition, the Company has used non-GAAP financial measures in this press release. A supplemental schedule of each non-GAAP financial measure and the comparable GAAP financial measure can be found on pages 10 through 12 of this release.
(1) See attached supplemental schedule of non-GAAP financial measures.
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Quarter Ended
March 31,
----------------
2009 2008
---- ----
Revenue:
Interest income $30,500,023 $55,416,330
Property operating income 1,470,796 -
Other income 16,250 20,693
---------- ----------
Total revenue 31,987,069 55,437,023
---------- ----------
Expenses:
Interest expense 19,150,816 31,304,099
Employee compensation and benefits 2,391,984 1,977,343
Selling and administrative 2,082,342 1,538,066
Property operating expenses 1,331,145 -
Depreciation and amortization 283,022 -
Provision for loan losses 67,500,000 3,000,000
Loss on restructured loans 9,036,914 -
Management fee - related party 722,377 2,579,433
----------- ----------
Total expenses 102,498,600 40,398,941
----------- ----------
(Loss) income before gain on exchange of
profits interest, gain on extinguishment
of debt and income from equity affiliates (70,511,531) 15,038,082
Gain on exchange of profits interest 55,988,411 -
Gain on extinguishment of debt 26,267,033 -
Income from equity affiliates 2,507,134 -
---------- -
Net income 14,251,047 15,038,082
Net income attributable to noncontrolling
interest 18,504,785 2,333,290
---------- ---------
Net (loss) income attributable to Arbor
Realty Trust, Inc. $(4,253,738) $12,704,792
=========== ===========
Basic (loss) earnings per common share $(0.17) $0.62
====== =====
Diluted (loss) earnings per common share $(0.17) $0.62
====== =====
Dividends declared per common share $- $0.62
== =====
Weighted average number of shares
of common stock outstanding:
Basic 25,142,410 20,571,780
========== ==========
Diluted 25,142,410 24,403,381
========== ==========
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2009 2008
-------- -----------
(Unaudited) (Audited)
Assets:
Cash and cash equivalents $14,212,369 $832,041
Restricted cash 82,967,024 93,219,133
Loans and investments, net 2,066,769,327 2,181,683,619
Available-for-sale securities, at
fair value 293,946 529,104
Securities held-to-maturity, net 57,887,120 58,244,348
Investment in equity affiliates 87,120,326 29,310,953
Real estate owned, net 45,752,603 46,478,994
Due from related party 15,639,345 2,933,344
Prepaid management fee -
related party 26,340,397 26,340,397
Other assets 98,771,914 139,664,556
---------- -----------
Total assets $2,495,754,371 $2,579,236,489
============== ==============
Liabilities and Equity:
Repurchase agreements $46,148,296 $60,727,789
Collateralized debt obligations 1,125,920,483 1,152,289,000
Junior subordinated notes to
subsidiary trust issuing
preferred securities 266,680,000 276,055,000
Notes payable 501,436,161 518,435,437
Notes payable-related party - 4,200,000
Mortgage note payable 41,440,000 41,440,000
Due to related party 234,960 993,192
Due to borrowers 29,662,628 32,330,603
Deferred revenue 77,123,133 77,123,133
Other liabilities 120,656,269 134,647,667
------------- -------------
Total liabilities 2,209,301,930 2,298,241,821
------------- -------------
Equity:
Arbor Realty Trust, Inc. stockholders' equity:
Preferred stock, $0.01 par value:
100,000,000 shares authorized - -
Common stock, $0.01 par value:
500,000,000 shares authorized;
25,421,810 shares issued, 25,142,410
shares outstanding at March 31, 2009 and
December 31, 2008 254,218 254,218
Additional paid-in capital 447,784,318 447,321,186
Treasury stock, at cost -
279,400 shares (7,023,361) (7,023,361)
Accumulated deficit (67,197,038) (62,939,722)
Accumulated other comprehensive loss (89,247,870) (96,606,672)
----------- -----------
Total Arbor Realty Trust, Inc.
stockholders' equity 284,570,267 281,005,649
----------- -----------
Noncontrolling interest in
consolidated entity 1,882,174 (10,981)
----------- -----------
Total equity 286,452,441 280,994,668
----------- -----------
Total liabilities and equity $2,495,754,371 $2,579,236,489
============== ==============
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULE OF NON-GAAP FINANCIAL MEASURES
(Unaudited)
Quarter Ended
March 31,
-------------
2009 2008
---- ----
Net (loss) income attributable to Arbor
Realty Trust, Inc., GAAP basis $(4,253,738) $12,704,792
Subtract: Prime transaction (37,325,607) -
Alpine Meadows operations (2,507,134) -
Gain on extinguishment of debt (26,267,033) -
------------ -----------
Net (loss) income attributable to Arbor
Realty Trust, Inc., as adjusted $(70,353,512) $12,704,792
============ ===========
Diluted (loss) earnings per common share,
GAAP basis $(0.17) $0.62
====== =====
Diluted (loss) earnings per common share,
as adjusted $(2.80) $0.62
====== =====
Diluted weighted average shares outstanding 25,142,410 24,403,381
========== ==========
a.) Given the magnitude and/or nature of certain transactions and
operations, Arbor has elected to report adjusted net (loss) income
attributable to Arbor Realty Trust, Inc. and (loss) earnings per share
for the affected periods to help ensure the comparability of the
reporting periods. Management considers these non-GAAP financial measures
to be effective indicators, for both management and investors, of Arbor's
financial performance. Arbor's management does not advocate that
investors consider such non-GAAP financial measures in isolation from, or
as a substitute for, financial information prepared in accordance with
GAAP.
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULE OF NON-GAAP FINANCIAL MEASURES - Continued
(Unaudited)
March 31, 2009
--------------
GAAP Arbor Realty Trust, Inc. Stockholders' Equity $284,570,267
Add: 450 West 33rd Street transaction - deferred revenue 77,123,133
Unrealized loss on derivative instruments 89,012,713
Subtract: 450 West 33rd Street transaction -
prepaid management fee (19,047,949)
-----------
Adjusted Arbor Realty Trust, Inc. Stockholders' Equity $431,658,164
============
Adjusted book value per share $17.17
======
GAAP book value per share $11.32
======
Common shares outstanding 25,142,410
==========
b.) Given the magnitude and the deferral structure of the 450 West 33rd
Street transaction combined with the change in the fair value of certain
derivative instruments, Arbor has elected to report adjusted book value
per share for the affected period to currently reflect the future impact
of the 450 West 33rd Street transaction on the company's financial
condition as well as the evaluation of Arbor without the effects of
unrealized losses from certain of the Company's derivative instruments.
Management considers this non-GAAP financial measure to be an effective
indicator, for both management and investors, of Arbor's financial
performance. Arbor's management does not advocate that investors consider
this non-GAAP financial measure in isolation from, or as a substitute
for, financial information prepared in accordance with GAAP.
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULE OF NON-GAAP FINANCIAL MEASURES - Continued
(Unaudited)
Quarter Ended
March 31,
-------------------
2009 2008
Net (loss) income attributable to ---- ----
Arbor Realty Trust, Inc., GAAP basis $(4,253,738) $12,704,792
Add:
Noncontrolling interest in operating
partnership - 2,333,290
Depreciation - real estate owned 283,022 -
Depreciation - investment in
equity affiliates 205,324 -
------- -
Funds from operations ("FFO") $(3,765,392) $15,038,082
=========== ===========
Diluted FFO per common share $(0.15) $0.62
====== =====
Diluted weighted average shares
outstanding 25,142,410 24,403,381
========== ==========
c.) Arbor is presenting funds from operations, or FFO, because management
believes it to be an important supplemental measure of the Company's
operating performance in that it is frequently used by analysts, investors
and other parties in the evaluation of real estate investment trusts
(REITs). The Company also uses FFO for the calculation of the incentive
Management fee payable to the Company's manager, Arbor Commercial
Mortgage, LLC . The revised White Paper on FFO approved by the Board of
Governors of the National Association of Real Estate Investment Trusts ,
or NAREIT, in April 2002 defines FFO as net income (loss) attributable
to Arbor Realty Trust, Inc. (computed in accordance with generally
accepted accounting principles (GAAP)), excluding gains (losses) from
sales of depreciated real properties, plus real estate related
depreciation and amortization and after adjustments for unconsolidated
partnerships and joint ventures. Arbor considers gains and losses on the
sales of real estate investments to be a normal part of our recurring
operating activities in accordance with GAAP and should not be excluded
when calculating FFO.
FFO is not intended to be an indication of our cash flow from operating
activities (determined in accordance with GAAP) or a measure of our
liquidity, nor is it entirely indicative of funding our cash needs,
including our ability to make cash distributions. Arbor's calculation
of FFO may be different from the calculation used by other companies and,
therefore, comparability may be limited.
Arbor Realty Trust, Inc.
Summary of Equity and Profit Interests
(all dollar amounts in thousands)
Unaudited
Current
Initial ART Cash
Invest- Invest- Equity Approximate
ment ment Invest- Profit Square
Name Amount Date ment % Footage
------ ------ ---- ----- ------ -------
80 Evergreen $384 3Q03 $201 12.50% 77,680
930 Flushing 1,126 3Q03 291 12.50% 304,080
Prime Portfolio 2,100 4Q03 - 7.50% 6,700,000
450 W. 33rd St 1,500 4Q03 1,137 0.58% (1) 1,746,734
Toy Building 10,000 2Q05 5,720 10.00% 320,000
Homewood Mtn
Resort - 2Q06 - 25.60% 1,224(3)
Richland Terrace
Apartments - 3Q06 - 25.00% 342,152
Ashley Court
Apartments - 3Q06 - 25.00% 177,892
Nottingham
Village - 1Q07 - 25.00% 285,900
Extended Stay
Hotel
Portfolio 115,000(5) 2Q07 115,000 16.17% 684(4)
Alpine Meadows 13,220 3Q07 13,220 39.00% 2,163(3)
St. John's
Development 500 4Q07 3,500 50.00% 23(3)
Windrush Village
Apartments - 2Q08 445 25.00% 221,726
Current
Property Debt Balance
Name Type Location on Property Comments
---- -------- -------- ----------- --------
80 Brooklyn,
Evergreen Warehouse NY $5,000 Property refinanced
June 2008
930 Brooklyn,
Flushing Warehouse NY 24,583 Property refinanced
July 2005
Prime Retail Multi-
Portfolio Outlets state 1,194,874 Properties
refinanced
450 New York
W. 33rd St Office City 517,000
Toy New York
Building Conversion City 343,400(2) Condo conversion -
investment held in
Taxable REIT
Subsidiary ("TRS")
Homewood Homewood,
Mtn Resort Land CA 114,157 Profits interest
held in TRS
Richland
Terrace Multi Columbia,
Apartments Family SC 9,019
Ashley
Court Multi Fort Wayne,
Apartments Family IN 5,452
Nottingham Multi Indianapolis,
Village Family IN 6,626
Extended
Stay Hotel Multi-
Portfolio Hotel state 7,400,000 Preferred return of
12% on equity
Alpine Alpine
Meadows Land Meadows,
CA 30,500 Preferred return of
18% on equity
St. John's Jacksonville,
Development Land FL 25,000
Windrush
Village Multi Tallahassee,
Apartments Family FL 12,800
(1) Represents approximately 29% of the 2% retained interest in the
property. In addition, Arbor has approximately 29% of a 50% interest in
the property's air rights.
(2) Debt balance represents anticipated debt financing required to
complete condominium conversion project.
(3) Amount represents approximate acreage of property.
(4) Amount represents approximately 684 properties in 44 states and
Canada with approximately 76,000 rooms.
(5) As of March 31, 2009 , the Company had loan loss reserves associated
with this investment of $83.9 million reducing the outstanding balance
to $18.1 million .
SOURCE
Contact:
Arbor Realty Trust, Inc.
Investor Relations
516-506-4200
InvestorRelations@arbor.com
Web Site: http://www.arborrealtytrust.com
(ABR ABR)
