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1Q15 8-K


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM 8-K
_________________________
CURRENT REPORT

Pursuant to Section 13 or 15(d) of The
Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):
April 28, 2015
_________________________
American Assets Trust, Inc.
(Exact name of registrant as specified in its charter)

_________________________

Maryland
(State or other jurisdiction
of incorporation)
001-35030
(Commission
File No.)
27-3338708
(I.R.S. Employer
Identification No.)
11455 El Camino Real, Suite 200
San Diego, California 92130
(Address of principal executive offices)
 
92130  
 (Zip Code)
 
(858) 350-2600  
Registrant’s telephone number, including area code: 
Not Applicable  
(Former name or former address, if changed since last report.)
_________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425).
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))





Item 2.02
Results of Operations and Financial Condition.

On April 28, 2015, American Assets Trust, Inc. (the “Company”) issued a press release regarding its financial results for the quarter ending March 31, 2015. Also on April 28, 2015, the Company made available on its website at www.americanassetstrust.com certain supplemental information concerning the Company’s financial results and operations for the quarter ending March 31, 2015. Copies of the press release and supplemental information are attached hereto as Exhibits 99.1 and 99.2, respectively.

Exhibits 99.1 and 99.2, are being furnished pursuant to Item 2.02 and shall not be deemed “filed” for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. Such information shall not be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.


Item 7.01
Regulation FD Disclosure.

As discussed in Item 2.02 above, the Company issued a press release regarding its financial results for the quarter ending March 31, 2015 and made available on its website certain supplement information relating thereto.

The information being furnished pursuant to Item 7.01 and shall not be deemed “filed” for any purpose, including for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section. Such information shall not be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.


Item 9.01
Financial Statements and Exhibits.
(d)    Exhibits:
The following exhibits are filed herewith:
Exhibit Number
 
Exhibit Description
99.1**
 
Press release issued by American Assets Trust, Inc. on April 28, 2015.
99.2**
 
American Assets Trust, Inc. Supplemental Information for the quarter ended March 31, 2015.
_____________________
** Furnished herewith

2


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
American Assets Trust, Inc.
 
By:
/s/ Robert F. Barton
 
Robert F. Barton
Executive Vice President, CFO
April 28, 2015
 
 

3



EXHIBIT INDEX
Exhibit Number
 
Exhibit Description
99.1
 
Press release issued by American Assets Trust, Inc. on April 28, 2015.
99.2
 
American Assets Trust, Inc. Supplemental Information for the quarter ended March 31, 2015.


4
1Q15 Earnings Release



American Assets Trust, Inc. Reports First Quarter 2015 Financial Results

FFO per share increases 10% year-over-year for the three months ended March 31, 2015
Same-Store Cash NOI increases 7.5% year-over-year for the three months ended March 31, 2015

SAN DIEGO, California - 4/28/2015 - American Assets Trust, Inc. (NYSE: AAT) (the “company”) today reported financial results for its first quarter ended March 31, 2015.

Financial Results and Recent Developments
•
Funds From Operations increased 10% year over year to $0.43 per diluted share for the three months ended March 31, 2015 compared to the same period in 2014
•
Increasing 2015 annual guidance to a range of $1.70 to $1.75 of FFO per diluted share, a 1.5% increase over the prior midpoint
•
Net income available to common stockholders increased 74% to $8.0 million for the three months ended March 31, 2015 compared to the same period in 2014
•
Same-store cash and GAAP NOI increased 7.5% and 6.5%, respectively, for the three months ended March 31, 2015 compared to the same period in 2014
•
Leased approximately 50,800 comparable office square feet at an average cash-basis and GAAP-basis contractual rent increase of 4% and 8%, respectively, during the three months ended March 31, 2015
•
Leased approximately 25,900 comparable retail square feet at an average cash-basis and GAAP-basis contractual rent increase of 4% and 7%, respectively, during the three months ended March 31, 2015

During the first quarter of 2015, the company generated funds from operations (“FFO”) for common stockholders of $26.4 million, or $0.43 per diluted share, compared to $22.9 million, or $0.39 per diluted share, for the quarter ended March 31, 2014. The increase in FFO from the corresponding period in 2014 was due to growth in same-store net operating income and a decrease in interest expense related to the company's payoff of outstanding secured mortgages encumbering Waikele Center, The Shops at Kalakaua and Del Monte Center offset with the issuance of senior guaranteed notes bearing lower interest rates.

Net income attributable to common stockholders was $8.0 million, or $0.18 per basic and diluted share for the three months ended March 31, 2015 compared to $4.6 million, or $0.11 per basic and diluted share for the three months ended March 31, 2014. The increase in net income attributable to common stockholders for the three months ended March 31, 2015 was due to growth in same-store net operating income and a decrease in interest expense as noted above.

FFO is a non-GAAP supplemental earnings measure which the company considers meaningful in measuring its operating performance. A reconciliation of FFO to net income is attached to this press release.


1


Portfolio Results
The portfolio leased status as of the end of the indicated quarter was as follows:
 
March 31, 2015
December 31, 2014
March 31, 2014
Total Portfolio
 
 
 
Retail
98.5%
98.6%
96.8%
Office
92.7%
91.4%
89.5%
Multifamily
96.4%
97.1%
96.3%
Mixed-Use:
 
 
 
Retail
100.0%
99.6%
98.9%
Hotel
89.0%
79.8%
90.2%
 
 
 
 
Same-Store Portfolio
 
 
Retail
98.5%
98.6%
96.8%
Office
96.0%
95.3%
92.4%
Multifamily
96.4%
97.1%
96.3%
Mixed-Use:
 
 
 
Retail
100.0%
99.6%
98.9%
Hotel
89.0%
79.8%
90.2%

During the first quarter of 2015, the company signed 34 leases for approximately 129,800 square feet of retail and office space, as well as 157 multifamily apartment leases. Renewals accounted for 72.7% of the comparable retail leases, 83.3% of the comparable office leases and 53.5% of the residential leases.

Retail and Office
On a comparable space basis (i.e. leases for which there was a former tenant) during the first quarter of 2015 and trailing four quarters ending March 31, 2015, our retail and office leasing spreads are shown below:
 
 
Number of Leases Signed
Comparable Leased Sq. Ft.
Average Cash Basis % Change Over Prior Rent
Average Cash Contractual Rent Per Sq. Ft.
Prior Average Cash Contractual Rent Per Sq. Ft.
GAAP Straight-Line Basis % Change Over Prior Rent
Retail
Q1 2015
11
25,900
4.1%
$38.85
$37.31
7.4%
Last 4 Quarters
51
192,900
10.4%
$33.54
$30.39
16.6%
 
 
 
 
 
 
 
 
Office
Q1 2015
12
50,800
3.7%
$24.84
$23.97
7.9%
Last 4 Quarters
35
249,300
9.7%
$30.36
$27.67
17.5%

Multifamily
At March 31, 2015, the average monthly base rent per leased unit was $1,515 compared to an average monthly base rent per leased unit of $1,445 at March 31, 2014, an increase of 4.8%.


2


Same-Store Operating Income
For the three months ended March 31, 2015, same-store property operating cash and GAAP income increased 7.5% and 6.5%, respectively, compared to the corresponding period in 2014. The same-store property operating income by segment was as follows (in thousands):
 
Three Months Ended (1)
 
 
 
 
March 31,
 
 
 
 
2015
 
2014
 
Change
Cash Basis:
 
 
 
 
 
 
Retail
$
17,798

 
$
16,567

 
7.4

%
Office
11,247

 
10,022

 
12.2

 
Multifamily
2,826

 
2,703

 
4.6

 
Mixed-Use
5,797

 
5,755

 
0.7

 
 
$
37,668

 
$
35,047

 
7.5

%
 
 
 
 
 
 
 
GAAP Basis:
 
 
 
 
 
 
Retail
$
18,079

 
$
16,936

 
6.7

%
Office
12,371

 
11,280

 
9.7

 
Multifamily
2,826

 
2,703

 
4.6

 
Mixed-Use
5,747

 
5,725

 
0.4

 
 
$
39,023

 
$
36,644

 
6.5

%
(1)
Same-store portfolio excludes (i) Torrey Reserve Campus and Lloyd District Portfolio due to significant redevelopment activity during the period and (ii) land held for development.

On a same-store basis, retail property operating income increased for the three months ended March 31, 2015 compared to the same period in 2014 primarily due to the increase in percentage leased and additional cost reimbursements in 2015. The increase can be partially attributed to new leases, specifically at Carmel Mountain Plaza and Lomas Santa Fe Plaza.

On a same-store basis, office property operating income increased on a cash basis for the three months ended March 31, 2015 compared to the same period in 2014 due to an increase in annualized base rent, primarily at City Center Bellevue. The increase in office property operating income on a cash basis is also attributed to rent abatements for tenants at The Landmark at One Market and City Center Bellevue received in the prior period. On a same-store basis, office property operating income increased on a GAAP basis for the three months ended March 31, 2015 compared to the same period in 2014 due to an increase in percentage leased, specifically at First & Main and City Center Bellevue. At March 31, 2015, approximately 45,000 square feet, or 63% of the square footage vacated by the Treasury Tax Administration, has been leased to new tenants.

On a same-store basis, multifamily property operating income increased for the three months ended March 31, 2015 compared to the corresponding period in 2014 primarily due to an increase in average monthly base rent during 2015.



3


Development
We are finalizing our redevelopment efforts at Torrey Reserve Campus and have completed our construction to increase rentable office space by approximately 81,500 square feet during the first quarter of 2015. Total costs of the redevelopment are approximately $34 million. We expect the Torrey Reserve Campus redevelopment to be stabilized by the end of this year with an estimated stabilized cash yield of approximately 8.6%.

Lloyd District Portfolio remains within budget and on schedule. Projected costs of the redevelopment at Lloyd District Portfolio are approximately $192 million, of which approximately $162 million has been incurred to date. We expect to incur the remaining costs for redevelopment of the Lloyd District Portfolio in 2015. We expect the Lloyd District Portfolio redevelopment to be stabilized in 2017 with an estimated stabilized cash yield of approximately 6.25% to 7.25%.

Torrey Point is scheduled for groundbreaking during the second quarter of 2015. Projected costs of the redevelopment at Torrey Point are approximately $46.2 million, of which approximately $7.2 million has been incurred to date. We expect to incur the remaining costs for redevelopment of Torrey Point in 2015 and 2016. We expect the Torrey Point redevelopment to be stabilized in 2017 with an estimated stabilized cash yield of approximately 8.25% to 9.25%.

Our redevelopment and development opportunities are subject to market conditions and actual results may vary.

Balance Sheet and Liquidity
At March 31, 2015, the company had gross real estate assets of $2.2 billion and liquidity of $284.6 million, comprised of cash and cash equivalents of $54.6 million and $230.0 million of availability on its line of credit.

For the three months ended March 31, 2015, we issued 53,800 shares of common stock through our at-the-market ("ATM") equity program at a weighted average price per share of $42.54, resulting in net proceeds of $2.2 million. We intend to use the net proceeds primarily to fund our development activities at Lloyd District Portfolio and Torrey Point. As of March 31, 2015, we had the capacity to issue up to an additional $30.1 million in shares of common stock under our ATM equity program.

On March 9, 2015, we entered into a common stock purchase agreement (the “Purchase Agreement”) with Explorer Insurance Company, a California corporation ("EIC") an entity owned and controlled by Ernest Rady, the Executive Chairman of our Board of Directors. The Purchase Agreement provided for the sale by us to EIC, in a private placement, of 200,000 shares of our common stock at a purchase price of $40.54 per share, resulting in gross proceeds to us of approximately $8.1 million. The price per share paid by EIC was equal to the closing price of a share of our common stock on the New York Stock Exchange on the date of the Purchase Agreement. As of March 31, 2015, Mr. Rady and his affiliates owned an approximately 34.1% beneficial interest of the company on a fully diluted  basis (including common units of our operating partnership), which is an approximately 1.8% decrease from January 19, 2011, the closing date of the company’s initial public offering (“IPO”).   .

Dividends
The company declared dividends on its shares of common stock of $0.2325 per share for the first quarter of 2015. The dividends were paid on March 27, 2015.

In addition, the company has declared a dividend on its common stock of $0.2325 per share for the quarter ending June 30, 2015. The dividend will be paid on June 26, 2015 to stockholders of record on June 12, 2015.


4


Guidance
The company increased its guidance for full year 2015 FFO per diluted share to a range of $1.70 to $1.75 per share from the prior range of $1.67 to $1.73 per share, an increase of 1.5% over the prior midpoint. The company's guidance excludes any impact from future acquisitions, dispositions, equity issuances or repurchases, future debt financings or repayments, except that guidance includes the remaining issuance of the company's existing ATM equity program in 2015. The company will discuss key assumptions regarding the guidance tomorrow on the conference call.
The foregoing estimates are forward-looking and reflect management's view of current and future market conditions, including certain assumptions with respect to leasing activity, rental rates, occupancy levels, interest rates and the amount and timing of acquisition and development activities. The company's actual results may differ materially from these estimates.

Conference Call
The company will hold a conference call to discuss the results for the first quarter of 2015 on Wednesday, April 29, 2015 at 8:00 a.m. Pacific Time (“PT”). To participate in the event by telephone, please dial 1-800-798-2864 and use the pass code 73517984. A telephonic replay of the conference call will be available beginning at 12:00 p.m. PT on Wednesday, April 29, 2015 through Monday, May 4, 2015. To access the replay, dial 1-888-286-8010 and use the pass code 37548864. A live on-demand audio webcast of the conference call will be available on the company's website at www.americanassetstrust.com. A replay of the call will also be available on the company's website.

Supplemental Information
Supplemental financial information regarding the company's first quarter 2015 results may be found in the “Investor Relations” section of the company's website at www.americanassetstrust.com. This supplemental information provides additional detail on items such as property occupancy, financial performance by property and debt maturity schedules.

5


Financial Information
American Assets Trust, Inc.
Consolidated Balance Sheets
(In Thousands, Except Share Data)
 
March 31, 2015
 
December 31, 2014
 
(unaudited)
 
 
 
Assets
 
 
 
 
 

Real estate, at cost
 
 

 
 
 

Operating real estate
$
1,938,663

 
$
1,931,698

Construction in progress
 
232,597

 
 
195,736

Held for development
 
9,413

 
 
9,390

 
 
2,180,673

 
 
2,136,824

Accumulated depreciation
 
(373,794
)
 
 
(361,424
)
Net real estate
 
1,806,879

 
 
1,775,400

Cash and cash equivalents
 
54,639

 
 
59,357

Restricted cash
 
10,252

 
 
10,994

Accounts receivable, net
 
5,772

 
 
6,727

Deferred rent receivables, net
 
36,467

 
 
35,883

Other assets, net
 
52,140

 
 
53,401

Total assets
$
1,966,149

 
$
1,941,762

Liabilities and equity
 
 

 
 
 

Liabilities:
 
 

 
 
 

Secured notes payable
$
711,809

 
$
812,811

Unsecured notes payable
 
350,000

 
 
250,000

Unsecured line of credit
 
20,000

 
 
—

Accounts payable and accrued expenses
 
55,045

 
 
50,861

Security deposits payable
 
5,874

 
 
5,521

Other liabilities and deferred credits, net
 
55,867

 
 
55,993

Total liabilities
 
1,198,595

 
 
1,175,186

Commitments and contingencies
 
 

 
 
 

Equity:
 
 

 
 
 

American Assets Trust, Inc. stockholders' equity
 
 
 
 
 
Common stock, $0.01 par value, 490,000,000 shares authorized, 43,821,165 and 43,701,669 shares issued and outstanding at March 31, 2015 and December 31, 2014, respectively
 
438

 
 
437

Additional paid-in capital
 
800,081

 
 
795,065

Accumulated dividends in excess of net income
 
(62,409
)
 
 
(60,291
)
Accumulated other comprehensive (loss) income
 
(618
)
 
 
92

Total American Assets Trust, Inc. stockholders' equity
 
737,492

 
 
735,303

Noncontrolling interests
 
30,062

 
 
31,273

Total equity
 
767,554

 
 
766,576

Total liabilities and equity
$
1,966,149

 
$
1,941,762


6


American Assets Trust, Inc.
Unaudited Consolidated Statements of Income
(In Thousands, Except Shares and Per Share Data)
 
Three Months Ended March 31,
 
2015
 
2014
Revenue:
 
 
 
Rental income
$
62,753

 
$
60,482

Other property income
3,282

 
3,498

Total revenue
66,035

 
63,980

Expenses:
 
 
 
Rental expenses
16,620

 
16,620

Real estate taxes
6,048

 
6,026

General and administrative
5,016

 
4,612

Depreciation and amortization
15,107

 
16,341

Total operating expenses
42,791

 
43,599

Operating income
23,244

 
20,381

Interest expense
(11,795
)
 
(13,632
)
Other income (expense), net
(70
)
 
(91
)
Net income
11,379

 
6,658

Net income attributable to restricted shares
(43
)
 
(70
)
Net income attributable to unitholders in the Operating Partnership
(3,309
)
 
(1,986
)
Net income attributable to American Assets Trust, Inc. stockholders
$
8,027

 
$
4,602

 
 
 
 
Net income per share
 
 
 
Basic income attributable to common stockholders per share
$
0.18

 
$
0.11

Weighted average shares of common stock outstanding - basic
43,419,762

 
40,582,792

 
 
 
 
Diluted income attributable to common stockholders per share
$
0.18

 
$
0.11

Weighted average shares of common stock outstanding - diluted
61,321,447

 
58,492,473

 
 
 
 
Dividends declared per common share
$
0.2325

 
$
0.2200

 
 
 
 


7


Reconciliation of Net Income to Funds From Operations
The company's FFO attributable to common stockholders and operating partnership unitholders and reconciliation to net income is as follows (in thousands except shares and per share data, unaudited):
 
Three Months Ended
 
March 31, 2015
Funds From Operations (FFO)
 
 
Net income
$
11,379

Depreciation and amortization of real estate assets
 
15,107

FFO, as defined by NAREIT
$
26,486

Less: Nonforfeitable dividends on incentive stock awards
 
(40
)
FFO attributable to common stock and units
$
26,446

FFO per diluted share/unit
$
0.43

Weighted average number of common shares and units, diluted
 
61,329,952


Reported results are preliminary and not final until the filing of the company's Form 10-Q with the Securities and Exchange Commission and, therefore, remain subject to adjustment.

Use of Non-GAAP Information
The company calculates FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts, or NAREIT. FFO represents net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, impairment losses, real estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures.

FFO is a supplemental non-GAAP financial measure. Management uses FFO as a supplemental performance measure because it believes that FFO is beneficial to investors as a starting point in measuring the company's operational performance. Specifically, in excluding real estate related depreciation and amortization and gains and losses from property dispositions, which do not relate to or are not indicative of operating performance, FFO provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. The company also believes that, as a widely recognized measure of the performance of REITs, FFO will be used by investors as a basis to compare the company's operating performance with that of other REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of the company's properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of the company's properties, all of which have real economic effects and could materially impact the company's results from operations, the utility of FFO as a measure of the company's performance is limited. In addition, other equity REITs may not calculate FFO in accordance with the NAREIT definition as the company does, and, accordingly, the company's FFO may not be comparable to such other REITs' FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of the company's performance. FFO should not be used as a measure of the company's liquidity, nor is it indicative of funds available to fund the company's cash needs, including the company's ability to pay dividends or service indebtedness. FFO also should not be used as a supplement to or substitute for cash flow from operating activities computed in accordance with GAAP.

8


About American Assets Trust, Inc.
American Assets Trust, Inc. (the “company”) is a full service, vertically integrated and self-administered real estate investment trust, or REIT, headquartered in San Diego, California. For over 40 years, the company has been acquiring, improving, developing and managing premier retail, office and residential properties throughout the United States in some of the nation's most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Oregon, Washington and Hawaii. The company's retail portfolio comprises approximately 3.1 million rentable square feet, and its office portfolio comprises approximately 2.7 million square feet. In addition, the company owns one mixed-use property (including approximately 97,000 rentable square feet of retail space and a 369-room all-suite hotel) and over 900 multifamily units. In 2011, the company was formed to succeed to the real estate business of American Assets, Inc., a privately held corporation founded in 1967 and, as such, has significant experience, long-standing relationships and extensive knowledge of its core markets, submarkets and asset classes. For additional information, please visit www.americanassetstrust.com.

Forward Looking Statements
This press release may contain forward-looking statements within the meaning of the federal securities laws, which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. While forward-looking statements reflect the company's good faith beliefs, assumptions and expectations, they are not guarantees of future performance. For a further discussion of these and other factors that could cause the company's future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the company's most recent annual report on Form 10-K, and other risks described in documents subsequently filed by the company from time to time with the Securities and Exchange Commission. The company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes.

Source: American Assets Trust, Inc.

Investor and Media Contact:
American Assets Trust
Robert F. Barton
Executive Vice President and Chief Financial Officer
858-350-2607


9
1Q15 Supplemental exibit

 
 
 
FIRST QUARTER 2015
 
Supplemental Information
 
 






 
 
 
Investor and Media Contact
American Assets Trust
Robert F. Barton
Executive Vice President and Chief Financial Officer
858-350-2607

 
 
 
 
 

American Assets Trust, Inc.'s Portfolio is concentrated in high-barrier-to-entry markets
with favorable supply/demand characteristics
 
 
 
 
 
 
 
 
 
 
 
 
            
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Retail
 
Office
 
Multifamily
Mixed-Use
Market
 
 Square Feet
 
 Square Feet
 
 Units
 Square Feet
 
Suites
San Diego
 
1,226,111

 
705,650

 
922

(1)
—

 
—

 
 
 
 
 
 
 
 
 
 
 
San Francisco
 
35,156

 
516,985

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Oahu
 
549,308

 
—

 
—

 
96,707

 
369

 
 
 
 
 
 
 
 
 
 
 
Monterey
 
675,678

 
—

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
San Antonio
 
589,501

 
—

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Portland
 
—

 
942,844

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Seattle
 
—

 
494,781

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Total
 
3,075,754

 
2,660,260

 
922

 
96,707

 
369

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Square Feet
 
%
Note: Circled areas represent all markets in which American Assets Trust, Inc. (the "Company") currently owns and operates its real estate assets. Size of circle denotes approximation of square feet / units. Net rentable square footage may be adjusted from the prior periods to reflect re-measurement of leased space at the properties.
 
Retail
 
3.1

million
 
53%
 
Office
 
2.7

million
 
47%
Data is as of March 31, 2015.
 
Totals
 
5.8

million
 
 
(1) Includes 122 RV spaces.
 
 
 
 
 
 
 

First Quarter 2015 Supplemental Information
                               Page 2

 
 
INDEX
 
 

 
FIRST QUARTER 2015 SUPPLEMENTAL INFORMATION
 
1.
FINANCIAL HIGHLIGHTS
 
 
Consolidated Balance Sheets
 
Consolidated Statements of Income
 
Funds From Operations (FFO), FFO As Adjusted & Funds Available for Distribution
 
Corporate Guidance
 
Same-Store Portfolio Net Operating Income (NOI)
 
Same-Store Portfolio NOI Comparison excluding Redevelopment
 
Same-Store Portfolio NOI Comparison with Redevelopment
 
NOI By Region
 
NOI Breakdown
 
Property Revenue and Operating Expenses
 
Segment Capital Expenditures
 
Summary of Outstanding Debt
 
Market Capitalization
 
Summary of Development Opportunities
2.
PORTFOLIO DATA
 
 
Property Report
 
Retail Leasing Summary
 
Office Leasing Summary
 
Multifamily Leasing Summary
 
Mixed-Use Leasing Summary
 
Lease Expirations
 
Portfolio Leased Statistics
 
Top Tenants - Retail
 
Top Tenants - Office
3.
APPENDIX
 
 
Glossary of Terms
This Supplemental Information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act). Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: adverse economic or real estate developments in our markets; our failure to generate sufficient cash flows to service our outstanding indebtedness; defaults on, early terminations of or non-renewal of leases by tenants, including significant tenants; difficulties in identifying properties to acquire and completing acquisitions; difficulties in completing dispositions; our failure to successfully operate acquired properties and operations; our inability to develop or redevelop our properties due to market conditions; fluctuations in interest rates and increased operating costs; risks related to joint venture arrangements; our failure to obtain necessary outside financing; on-going litigation; general economic conditions; financial market fluctuations; risks that affect the general retail, office, multifamily and mixed-use environment; the competitive environment in which we operate; decreased rental rates or increased vacancy rates; conflicts of interests with our officers or directors; lack or insufficient amounts of insurance; environmental uncertainties and risks related to adverse weather conditions and natural disasters; other factors affecting the real estate industry generally; limitations imposed on our business and our ability to satisfy complex rules in order for us to continue to qualify as a REIT for U.S. federal income tax purposes; and changes in governmental regulations or interpretations thereof, such as real estate and zoning laws and increases in real property tax rates and taxation of REITs.
While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. We disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, or new information, data or methods, future events or other changes. For a further discussion of these and other factors that could impact our future results, refer to our most recent Annual Report on Form 10-K and other risks described in documents subsequently filed by us from time to time with the Securities and Exchange Commission.

First Quarter 2015 Supplemental Information
                               Page 3

 
 
 
 
 






FINANCIAL HIGHLIGHTS





First Quarter 2015 Supplemental Information
                               Page 4

 
 
CONSOLIDATED BALANCE SHEETS
 
 

(Amounts in thousands, except shares and per share data)
March 31, 2015
 
December 31, 2014
 
(unaudited)
 
(audited)
ASSETS
 
 
 
Real estate, at cost
 
 
 
Operating real estate
$
1,938,663

 
$
1,931,698

Construction in progress
232,597

 
195,736

Held for development
9,413

 
9,390

 
2,180,673

 
2,136,824

Accumulated depreciation
(373,794
)
 
(361,424
)
Net real estate
1,806,879

 
1,775,400

Cash and cash equivalents
54,639

 
59,357

Restricted cash
10,252

 
10,994

Accounts receivable, net
5,772

 
6,727

Deferred rent receivable, net
36,467

 
35,883

Other assets, net
52,140

 
53,401

TOTAL ASSETS
$
1,966,149

 
$
1,941,762

LIABILITIES AND EQUITY
 
 
 
LIABILITIES:
 
 
 
Secured notes payable
$
711,809

 
$
812,811

Unsecured notes payable
350,000

 
250,000

Unsecured line of credit
20,000

 
—

Accounts payable and accrued expenses
55,045

 
50,861

Security deposits payable
5,874

 
5,521

Other liabilities and deferred credits, net
55,867

 
55,993

Total liabilities
1,198,595

 
1,175,186

Commitments and contingencies
 
 
 
EQUITY:
 
 
 
American Assets Trust, Inc. stockholders' equity
 
 
 
Common stock, $0.01 par value, 490,000,000 shares authorized, 43,821,165 and 43,701,669 shares issued and outstanding at March 31, 2015 and December 31, 2014, respectively
438

 
437

Additional paid in capital
800,081

 
795,065

Accumulated dividends in excess of net income
(62,409
)
 
(60,291
)
Accumulated other comprehensive income
(618
)
 
92

Total American Assets Trust, Inc. stockholders' equity
737,492

 
735,303

Noncontrolling interests
30,062

 
31,273

Total equity
767,554

 
766,576

TOTAL LIABILITIES AND EQUITY
$
1,966,149

 
$
1,941,762


First Quarter 2015 Supplemental Information
                               Page 5

 
 
CONSOLIDATED STATEMENTS OF INCOME
 
 

(Unaudited, amounts in thousands, except shares and per share data)
Three Months Ended
 
March 31,
 
2015
 
2014
REVENUE:
 
 
 
Rental income
$
62,753

 
$
60,482

Other property income
3,282

 
3,498

Total revenue
66,035

 
63,980

EXPENSES:
 
 
 
Rental expenses
16,620

 
16,620

Real estate taxes
6,048

 
6,026

General and administrative
5,016

 
4,612

Depreciation and amortization
15,107

 
16,341

Total operating expenses
42,791

 
43,599

OPERATING INCOME
23,244

 
20,381

Interest expense
(11,795
)
 
(13,632
)
Other income (expense), net
(70
)
 
(91
)
NET INCOME
11,379

 
6,658

Net income attributable to restricted shares
(43
)
 
(70
)
Net income attributable to unitholders in the Operating Partnership
(3,309
)
 
(1,986
)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, INC. STOCKHOLDERS
$
8,027

 
$
4,602

 
 
 
 
EARNINGS PER COMMON SHARE
 
 
 
Basic income attributable to common stockholders per share
$
0.18

 
$
0.11

Weighted average shares of common stock outstanding - basic
43,419,762

 
40,582,792

Diluted income attributable to common stockholders per share
$
0.18

 
$
0.11

Weighted average shares of common stock outstanding - diluted
61,321,447

 
58,492,473

 
 
 
 

First Quarter 2015 Supplemental Information
                               Page 6

 
 
FUNDS FROM OPERATIONS, FFO AS ADJUSTED & FUNDS AVAILABLE FOR DISTRIBUTION
 
 

(Unaudited, amounts in thousands, except shares and per share data)
Three Months Ended
 
March 31,
 
2015
 
2014
Funds from Operations (FFO) (1)
 
 
 
Net income
$
11,379

 
$
6,658

Depreciation and amortization of real estate assets
15,107

 
16,341

FFO, as defined by NAREIT
26,486

 
22,999

Less: Nonforfeitable dividends on incentive stock awards
(40
)
 
(70
)
FFO attributable to common stock and common units
$
26,446

 
$
22,929

 
 
 
 
FFO per diluted share/unit
$
0.43

 
$
0.39

 
 
 
 
Weighted average number of common shares and common units, diluted (2)
61,329,952

 
58,626,718

 
 
 
 
Funds Available for Distribution (FAD) (1)
$
20,244

 
$
16,798

 
 
 
 
Dividends
 
 
 
Dividends declared and paid
$
14,350

 
$
13,140

Dividends declared and paid per share/unit
$
0.2325

 
$
0.2200


First Quarter 2015 Supplemental Information
                               Page 7

 
 
FUNDS FROM OPERATIONS, FFO AS ADJUSTED & FUNDS AVAILABLE FOR DISTRIBUTION (CONTINUED)
 
 

(Unaudited, amounts in thousands, except shares and per share data)
Three Months Ended
 
March 31,
 
2015
 
2014
Funds Available for Distribution (FAD) (1)
 
 
 
FFO
$
26,486

 
$
22,999

Adjustments:
 
 
 
Tenant improvements, leasing commissions and maintenance capital expenditures
(6,722
)
 
(6,057
)
Net effect of straight-line rents (3)
(707
)
 
(1,058
)
Amortization of net above (below) market rents (4)
(728
)
 
(587
)
Net effect of other lease intangibles (5)
20

 
37

Amortization of debt issuance costs and debt fair value adjustment
1,045

 
1,015

Non-cash compensation expense
890

 
519

Nonforfeitable dividends on incentive stock awards
(40
)
 
(70
)
FAD
$
20,244

 
$
16,798

 
 
 
 
Summary of Capital Expenditures
 
 
 
Tenant improvements and leasing commissions
$
4,436

 
$
3,179

Maintenance capital expenditures
2,286

 
2,878

 
$
6,722

 
$
6,057


Notes:
(1)
See Glossary of Terms.
(2)
For the three months ended March 31, 2015 and 2014, the weighted average common shares and common units used to compute FFO per diluted share/unit include operating partnership common units and unvested restricted stock awards that are subject to time vesting. The shares/units used to compute FFO per diluted share/unit include additional shares/units which were excluded from the computation of diluted EPS, as they were anti-dilutive for the periods presented.
(3)
Represents the straight-line rent income recognized during the period offset by cash received during the period and the provision for bad debts recorded for deferred rent receivable balances.
(4)
Represents the adjustment related to the acquisition of buildings with above (below) market rents.
(5)
Represents adjustments related to amortization of lease incentives paid to tenants and amortization of lease intangibles and straight-line rent expense for our leases of the Annex at The Landmark at One Market and retail space at Waikiki Beach Walk - Retail.


First Quarter 2015 Supplemental Information
                               Page 8

 
 
CORPORATE GUIDANCE
 
 



(Unaudited, amounts in thousands, except share and per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Prior 2015 Guidance Range (1) (2)
 
Revised 2015 Guidance Range (2)
Funds from Operations (FFO):
 
 
 
 
 
 
 
 
Net income
 
$
44,085

 
$
47,708

 
$
45,071

 
$
48,153

Depreciation and amortization of real estate assets
 
59,569

 
59,569

 
60,423

 
60,423

FFO, as defined by NAREIT
 
103,654

 
107,277

 
105,494

 
108,576

Less: Nonforfeitable dividends on incentive stock awards
 
(164
)
 
(164
)
 
(160
)
 
(160
)
FFO attributable to common stock and units
 
$
103,490

 
$
107,113

 
$
105,334

 
$
108,416

Weighted average number of common shares and units, diluted
 
61,928,301

 
61,928,301

 
61,957,906

 
61,957,906

FFO per diluted share, updated
 
$
1.67

 
$
1.73

 
$
1.70

 
$
1.75


Notes:
(1)
Prior 2015 Guidance Range as reported in the Company's Fourth Quarter 2014 Supplemental Information report.
(2)
The Company's guidance excludes any impact from future acquisitions, dispositions, equity issuances or repurchases, future debt financings or repayments, except that guidance includes the remaining issuance of the Company's existing at-the-market equity program in 2015.

These estimates are forward-looking and reflect management's view of current and future market conditions, including certain assumptions with respect to leasing activity, rental rates, occupancy levels, interest rates and the amount and timing of acquisition and development activities. Our actual results may differ materially from these estimates.


First Quarter 2015 Supplemental Information
                               Page 9

 
 
SAME-STORE PORTFOLIO NET OPERATING INCOME (NOI)
 
 

(Unaudited, amounts in thousands)
Three Months Ended March 31, 2015
 
Retail
 
Office
 
Multifamily
 
Mixed-Use
 
Total
Real estate rental revenue
 
 
 
 
 
 
 
 
 
Same-store portfolio
$
24,032

 
$
16,912

 
$
4,310

 
$
14,110

 
$
59,364

Non-same store portfolio (1)
6

 
6,665

 
—

 
—

 
6,671

Total
24,038

 
23,577

 
4,310

 
14,110

 
66,035

Real estate expenses
 
 
 
 
 
 
 
 
 
Same-store portfolio
5,953

 
4,541

 
1,484

 
8,363

 
20,341

Non-same store portfolio (1)
47

 
2,280

 
—

 
—

 
2,327

Total
6,000

 
6,821

 
1,484

 
8,363

 
22,668

Net Operating Income (NOI), GAAP basis
 
 
 
 
 
 
 
 
 
Same-store portfolio
18,079

 
12,371

 
2,826

 
5,747

 
39,023

Non-same store portfolio (1)
(41
)
 
4,385

 
—

 
—

 
4,344

Total
$
18,038

 
$
16,756

 
$
2,826

 
$
5,747

 
$
43,367

Same-store portfolio NOI, GAAP basis
$
18,079

 
$
12,371

 
$
2,826

 
$
5,747

 
$
39,023

Net effect of straight-line rents (2)
33

 
(502
)
 
—

 
(42
)
 
(511
)
Amortization of net above (below) market rents (3)
(314
)
 
(581
)
 
—

 
123

 
(772
)
Net effect of other lease intangibles (4)
—

 
(41
)
 
—

 
(31
)
 
(72
)
Same-store portfolio NOI, cash basis
$
17,798

 
$
11,247

 
$
2,826

 
$
5,797

 
$
37,668


Notes:
(1)
Same-store portfolio and non-same store portfolio are determined based on properties held on March 31, 2015 and 2014. See Glossary of Terms.
(2)
Represents the straight-line rent income recognized during the period offset by cash received during the period and the provision for bad debts recorded for deferred rent receivable balances.
(3)
Represents the adjustment related to the acquisition of buildings with above (below) market rents.
(4)
Represents adjustments related to amortization of lease incentives paid to tenants and amortization of lease intangibles and straight-line rent expense for our lease of the Annex at The Landmark at One Market and retail space at Waikiki Beach Walk - Retail.

First Quarter 2015 Supplemental Information
                               Page 10

 
 
SAME-STORE PORTFOLIO NOI COMPARISON EXCLUDING REDEVELOPMENT
 
 

(Unaudited, amounts in thousands)
Three Months Ended
 
 
 
March 31,
 
 
 
2015
 
2014
 
Change
Cash Basis:
 
 
 
 
 
Retail
$
17,798

 
$
16,567

 
7.4
%
Office
11,247

 
10,022

 
12.2

Multifamily
2,826

 
2,703

 
4.6

Mixed-Use
5,797

 
5,755

 
0.7

 
$
37,668

 
$
35,047

 
7.5
%
 
 
 
 
 
 
GAAP Basis:
 
 
 
 
 
Retail
$
18,079

 
$
16,936

 
6.7
%
Office
12,371

 
11,280

 
9.7

Multifamily
2,826

 
2,703

 
4.6

Mixed-Use
5,747

 
5,725

 
0.4

 
$
39,023

 
$
36,644

 
6.5
%


First Quarter 2015 Supplemental Information
                               Page 11

 
 
SAME-STORE PORTFOLIO NOI COMPARISON WITH REDEVELOPMENT
 
 

(Unaudited, amounts in thousands)
Three Months Ended
 
 
 
March 31,
 
 
 
2015
 
2014
 
Change
Cash Basis:
 
 
 
 
 
Retail
$
17,798

 
$
16,567

 
7.4
%
Office
15,573

 
14,699

 
5.9

Multifamily
2,826

 
2,703

 
4.6

Mixed-Use
5,797

 
5,755

 
0.7

 
$
41,994

 
$
39,724

 
5.7
%
 
 
 
 
 
 
GAAP Basis:
 
 
 
 
 
Retail
$
18,079

 
$
16,936

 
6.7
%
Office
16,758

 
15,968

 
4.9

Multifamily
2,826

 
2,703

 
4.6

Mixed-Use
5,747

 
5,725

 
0.4

 
$
43,410

 
$
41,332

 
5.0
%

First Quarter 2015 Supplemental Information
                               Page 12

 
 
NOI BY REGION
 
 

(Unaudited, amounts in thousands)
Three Months Ended March 31, 2015
 
Retail
 
Office
 
Multifamily
 
Mixed-Use
 
Total
Southern California
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
$
7,623

 
$
3,871

 
$
2,826

 
$
—

 
$
14,320

Net effect of straight-line rents (2)
(138
)
 
(62
)
 
—

 
—

 
(200
)
Amortization of net above (below) market rents (3)
(214
)
 
(2
)
 
—

 
—

 
(216
)
Net effect of other lease intangibles (4)
—

 
93

 
—

 
—

 
93

NOI, cash basis
7,271

 
3,900

 
2,826

 
—

 
13,997

Northern California
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
2,719

 
4,301

 
—

 
—

 
7,020

Net effect of straight-line rents (2)
11

 
19

 
—

 
—

 
30

Amortization of net above (below) market rents (3)
(97
)
 
(178
)
 
—

 
—

 
(275
)
Net effect of other lease intangibles (4)
—

 
(42
)
 
—

 
—

 
(42
)
NOI, cash basis
2,633

 
4,100

 
—

 
—

 
6,733

Hawaii
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
4,410

 
—

 
—

 
5,747

 
10,157

Net effect of straight-line rents (2)
139

 
—

 
—

 
(42
)
 
97

Amortization of net above (below) market rents (3)
53

 
—

 
—

 
123

 
176

Net effect of other lease intangibles (4)
—

 
—

 
—

 
(31
)
 
(31
)
NOI, cash basis
4,602

 
—

 
—

 
5,797

 
10,399

Oregon
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
—

 
4,148

 
—

 
—

 
4,148

Net effect of straight-line rents (2)
—

 
(598
)
 
—

 
—

 
(598
)
Amortization of net above (below) market rents (3)
—

 
(50
)
 
—

 
—

 
(50
)
NOI, cash basis
—

 
3,500

 
—

 
—

 
3,500

Texas
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
3,286

 
—

 
—

 
—

 
3,286

Net effect of straight-line rents (2)
21

 
—

 
—

 
—

 
21

Amortization of net above (below) market rents (3)
(56
)
 
—

 
—

 
—

 
(56
)
NOI, cash basis
3,251

 
—

 
—

 
—

 
3,251

Washington
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
—

 
4,436

 
—

 
—

 
4,436

Net effect of straight-line rents (2)
—

 
(57
)
 
—

 
—

 
(57
)
Amortization of net above (below) market rents (3)
—

 
(307
)
 
—

 
—

 
(307
)
NOI, cash basis
—

 
4,072

 
—

 
—

 
4,072

Total
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
18,038

 
16,756

 
2,826

 
5,747

 
43,367

Net effect of straight-line rents (2)
33

 
(698
)
 
—

 
(42
)
 
(707
)
Amortization of net above (below) market rents (3)
(314
)
 
(537
)
 
—

 
123

 
(728
)
Net effect of other lease intangibles (4)
—

 
51

 
—

 
(31
)
 
20

NOI, cash basis
$
17,757

 
$
15,572

 
$
2,826

 
$
5,797

 
$
41,952

Notes:
(1)
See Glossary of Terms.
(2)
Represents the straight-line rent income recognized during the period offset by cash received during the period and the provision for bad debts recorded for deferred rent receivable balances.
(3)
Represents the adjustment related to the acquisition of buildings with above (below) market rents.
(4)
Represents adjustments related to amortization of lease incentives paid to tenants and amortization of lease intangibles and straight-line rent expense for our leases of the Annex at The Landmark at One Market and retail space at Waikiki Beach Walk - Retail.


First Quarter 2015 Supplemental Information
                               Page 13

 
 
NOI BREAKDOWN
 
 


Three Months Ended March 31, 2015
Portfolio NOI, Cash Basis Breakdown
 
 
 
 
 
Portfolio Diversification by Geographic Region
 
Portfolio Diversification by Segment
 
 
 
 
 
 
 
Portfolio NOI, GAAP Basis Breakdown
 
 
 
 
 
Portfolio Diversification by Geographic Region
 
Portfolio Diversification by Segment
 
 
 
 

First Quarter 2015 Supplemental Information
                               Page 14

 
 
PROPERTY REVENUE AND OPERATING EXPENSES
 
 

(Unaudited, amounts in thousands)
 
Three Months Ended March 31, 2015
 
 
 
 
Additional
 
 
 
Property
 
 
 
 
Property
 
Billed Expense
 
Operating
Property
 
Base Rent (1)
 
Income (2)
 
Reimbursements (3)
 
Expenses (4)
Retail Portfolio
 
 
 
 
 
 
 
 
Carmel Country Plaza
 
$
895

 
$
17

 
$
184

 
$
(126
)
Carmel Mountain Plaza
 
2,954

 
42

 
686

 
(772
)
South Bay Marketplace
 
565

 
40

 
165

 
(156
)
Rancho Carmel Plaza
 
199

 
9

 
54

 
(60
)
Lomas Santa Fe Plaza
 
1,218

 
11

 
261

 
(350
)
Solana Beach Towne Centre
 
1,466

 
16

 
467

 
(467
)
Del Monte Center
 
2,394

 
156

 
783

 
(1,004
)
Geary Marketplace
 
299

 
—

 
126

 
(121
)
The Shops at Kalakaua
 
455

 
23

 
38

 
(68
)
Waikele Center
 
4,134

 
368

 
966

 
(1,309
)
Alamo Quarry Market
 
3,359

 
47

 
1,367

 
(1,522
)
Subtotal Retail Portfolio
 
$
17,938

 
$
729

 
$
5,097

 
$
(5,955
)
Office Portfolio
 
 
 
 
 
 
 
 
Torrey Reserve Campus (5)
 
$
3,852

 
$
55

 
$
137

 
$
(1,026
)
Solana Beach Corporate Centre
 
1,606

 
9

 
71

 
(448
)
The Landmark at One Market
 
5,225

 
25

 
116

 
(1,866
)
One Beach Street
 
769

 
1

 
53

 
(223
)
First & Main
 
2,199

 
163

 
189

 
(707
)
Lloyd District Portfolio (5)
 
2,572

 
341

 
52

 
(1,244
)
City Center Bellevue
 
4,224

 
762

 
424

 
(1,338
)
Subtotal Office Portfolio
 
$
20,447

 
$
1,356

 
$
1,042

 
$
(6,852
)
Multifamily Portfolio
 
 
 
 
 
 
 
 
Loma Palisades
 
$
2,766

 
$
174

 
$
—

 
$
(951
)
Imperial Beach Gardens
 
718

 
59

 
—

 
(281
)
Mariner's Point
 
330

 
25

 
—

 
(118
)
Santa Fe Park RV Resort
 
220

 
18

 
—

 
(134
)
Subtotal Multifamily Portfolio
 
$
4,034

 
$
276

 
$
—

 
$
(1,484
)

First Quarter 2015 Supplemental Information
                               Page 15

 
 
PROPERTY REVENUE AND OPERATING EXPENSES (CONTINUED)
 
 

(Unaudited, amounts in thousands)
 
Three Months Ended March 31, 2015
 
 
 
 
Additional
 
 
 
Property
 
 
 
 
Property
 
Billed Expense
 
Operating
Property
 
Base Rent (1)
 
Income (2)
 
Reimbursements (3)
 
Expenses (4)
Mixed-Use Portfolio
 
 
 
 
 
 
 
 
Waikiki Beach Walk - Retail
 
$
2,601

 
$
1,015

 
$
898

 
$
(1,604
)
Waikiki Beach Walk - Embassy Suites™
 
9,008

 
667

 
—

 
(6,788
)
Subtotal Mixed-Use Portfolio
 
$
11,609

 
$
1,682

 
$
898

 
$
(8,392
)
Total
 
$
54,028

 
$
4,043

 
$
7,037

 
$
(22,683
)

Notes:
(1)
Base rent for our retail and office portfolio and the retail portion of our mixed-use portfolio represents base rent for the three months ended March 31, 2015 (before abatements) and excludes the impact of straight-line rent and above (below) market rent adjustments. Total abatements for our retail and office portfolio were approximately $15 and $420, respectively, for the three months ended March 31, 2015. There were no abatements for the retail portion of our mixed-use portfolio for the three months ended March 31, 2015. In the case of triple net or modified gross leases, annualized base rent does not include tenant reimbursements for real estate taxes, insurance, common area or other operating expenses. Multifamily portfolio base rent represents base rent (including parking, before abatements) less vacancy allowance and employee rent credits and includes additional rents (additional rents include insufficient notice penalties, month-to-month charges and pet rent). There were no abatements for our multifamily portfolio for the three months ended March 31, 2015. For Waikiki Beach Walk - Embassy Suites TM, base rent is equal to the actual room revenue for the three months ended March 31, 2015.
(2)
Represents additional property-related income for the three months ended March 31, 2015, which includes: (i) percentage rent, (ii) other rent (such as storage rent, license fees and association fees) and (iii) other property income (such as late fees, default fees, lease termination fees, parking revenue, the reimbursement of general excise taxes, laundry income and food and beverage sales).
(3)
Represents billed tenant expense reimbursements for the three months ended March 31, 2015.
(4)
Represents property operating expenses for the three months ended March 31, 2015. Property operating expenses includes all rental expenses, except non cash rent expense and the provision for bad debt recorded for deferred rent receivables.
(5)
Base rent shown includes amounts related to American Assets Trust, L.P.'s leases at Torrey Reserve Campus and Lloyd District Portfolio. This intercompany rent is eliminated in the consolidated statement of operations. The base rent and abatements were both $204 for the three months ended March 31, 2015.

First Quarter 2015 Supplemental Information
                               Page 16

 
 
SEGMENT CAPITAL EXPENDITURES
 
 

(Unaudited, amounts in thousands)
 
Three Months Ended March 31, 2015
Segment
 
Tenant Improvements and Leasing Commissions
 
Maintenance Capital Expenditures
 
Total Tenant Improvements, Leasing Commissions and Maintenance Capital Expenditures
 
Redevelopment and Expansions
 
New Development
 
Total Capital Expenditures
Retail Portfolio
 
$
503

 
$
282

 
$
785

 
$
84

 
$
66

 
$
935

Office Portfolio
 
3,822

 
1,598

 
5,420

 
8,374

 
920

 
14,714

Multifamily Portfolio
 
—

 
146

 
146

 
—

 
28,802

 
28,948

Mixed-Use Portfolio
 
111

 
260

 
371

 
—

 
—

 
371

Total
 
$
4,436

 
$
2,286

 
$
6,722

 
$
8,458

 
$
29,788

 
$
44,968

 
 
 
 
 
 
 
 
 
 
 
 
 



First Quarter 2015 Supplemental Information
                               Page 17

 
 
SUMMARY OF OUTSTANDING DEBT
 
 

(Amounts in thousands)
 
Amount
 
 
 
 
 
 
 
 
 
 
Outstanding at
 
 
 
Annual Debt
 
 
 
Balance at
Debt
 
March 31, 2015
 
Interest Rate
 
Service
 
Maturity Date
 
Maturity
The Landmark at One Market (1)(2)
 
133,000

 
5.61
%
 
135,526

 
July 5, 2015
 
133,000

First & Main (1)
 
84,500

 
3.97
%
 
3,406

 
July 1, 2016
 
84,500

Imperial Beach Gardens (1)
 
20,000

 
6.16
%
 
1,253

 
September 1, 2016
 
20,000

Mariner's Point (1)
 
7,700

 
6.09
%
 
477

 
September 1, 2016
 
7,700

South Bay Marketplace (1)
 
23,000

 
5.48
%
 
1,281

 
February 10, 2017
 
23,000

Waikiki Beach Walk - Retail (1)
 
130,310

 
5.39
%
 
7,137

 
July 1, 2017
 
130,310

Solana Beach Corporate Centre III-IV (3)
 
36,257

 
6.39
%
 
2,798

 
August 1, 2017
 
35,136

Loma Palisades (1)
 
73,744

 
6.09
%
 
4,566

 
July 1, 2018
 
73,744

One Beach Street (1)
 
21,900

 
3.94
%
 
877

 
April 1, 2019
 
21,900

Torrey Reserve - North Court (3)
 
20,995

 
7.22
%
 
1,836

 
June 1, 2019
 
19,443

Torrey Reserve - VCI, VCII, VCIII (3)
 
7,074

 
6.36
%
 
560

 
June 1, 2020
 
6,439

Solana Beach Corporate Centre I-II (3)
 
11,255

 
5.91
%
 
855

 
June 1, 2020
 
10,169

Solana Beach Towne Centre (3)
 
37,518

 
5.91
%
 
2,849

 
June 1, 2020
 
33,898

City Center Bellevue (1)
 
111,000

 
3.98
%
 
4,491

 
November 1, 2022
 
111,000

Total / Weighted Average
 
$
718,253

 
5.25
%
 
$
167,912

 
 
 
$
710,239

Unamortized fair value adjustment
 
(6,444
)
 
 
 
 
 
 
 
 
Secured Notes Payable
 
$
711,809

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Series A Notes (4)
 
$
150,000

 
3.88
%
 
$
6,060

 
October 31, 2021
 
$
150,000

Series B Notes (5)
 
100,000

 
4.45
%
 
4,450

 
February 2, 2025
 
100,000

Term Loan (6)
 
100,000

 
3.08
%
 
3,134

 
January 9, 2019
 
100,000

Unsecured Notes Payable
 
$
350,000

 
 
 
$
13,644

 
 
 
$
350,000

 
 
 
 
 
 
 
 
 
 
 
Unsecured Line of Credit (7)
 
$
20,000

 
 
 
 
 
 
 
 
Notes:
(1)
Interest only.
(2)
Loan repaid in full, without premium or penalty, on April 6, 2015.
(3)
Principal payments based on a 30-year amortization schedule.
(4)
$150 million of 4.04% Senior Guaranteed Notes, Series A, due October 31, 2021. Net of the settlement of the forward-starting interest rate swap, the fixed interest rate in accordance with GAAP for the Series A Notes is approximately 3.88% per annum, through maturity.
(5)
$100 million of 4.45% Senior Guaranteed Notes, Series B, due February 2, 2025.
(6)
The term loan matures in January 2016 and we have three 12-month options to extend its maturity to 2019. The term loan accrues interest at a variable rate, which we fixed as part of an interest rate swap for an all-in interest rate of 3.08%.
(7)
The unsecured revolving line of credit (the "Revolver Loan") has a capacity of $250 million plus an accordion feature that may allow us to increase the availability thereunder up to an additional $250 million , subject to meeting specified requirements and obtaining additional commitments from lenders. The Revolver Loan initially matures on January 9, 2018 and we have two six-month options to extend its maturity to January 9, 2019. The Revolver Loan currently accrues interest at LIBOR, plus a spread which ranges from 1.35%-1.95%, based on our consolidated leverage ratio.

First Quarter 2015 Supplemental Information
                               Page 18

 
 
MARKET CAPITALIZATION
 
 

(Amounts in thousands, except per share data)
 
 
 
 
 
 
 
 
 
Market data
 
March 31, 2015
 
 
Common shares outstanding
 
43,821

 
 
Common units outstanding
 
17,900

 
 
Common shares and common units outstanding
 
61,721


Market price per common share
 
$
43.28

 
Equity market capitalization
 
$
2,671,285


Total debt
 
$
1,088,253

 
Total market capitalization
 
$
3,759,538


Less: Cash on hand
 
$
(54,639
)
 
Total enterprise value
 
$
3,704,899


Total assets, gross
 
$
2,339,943

 
Total unencumbered assets, gross
 
$
1,057,780

 
 
 
 
 
Total debt/Total capitalization
 
28.9
%

Total debt/Total enterprise value
 
29.4
%

Net debt/Total enterprise value (1)
 
27.9
%

Total debt/Total assets, gross
 
46.5
%

Net debt/Total assets, gross (1)
 
44.2
%
 
Total unencumbered assets, gross/Unsecured debt
 
285.9
%
 
 
 
 
 
Total debt/EBITDA (2)(3)
 
7.1
x
 
Net debt/EBITDA (1)(2)(3)
 
6.7
x
 
Interest coverage ratio (4)
 
3.0
x
 
Fixed charge coverage ratio (4)
 
3.0
x
 

Notes:
(1)
Net debt is equal to total debt less cash on hand.
(2)
See Glossary of Terms for discussion of EBITDA.
(3)
As used here, EBITDA represents the actual for the three months ended March 31, 2015 annualized.
(4)
Calculated as EBITDA divided by interest on borrowed funds, including capitalized interest and excluding debt fair value adjustments and loan fee amortization.
(5)
Assumes the exercise of the three 12-month options to extend the maturity of the unsecured term loan.

First Quarter 2015 Supplemental Information
                               Page 19

 
 
SUMMARY OF DEVELOPMENT OPPORTUNITIES
 
 

Our portfolio has numerous potential opportunities to create future shareholder value. These opportunities could be subject to government approvals, lender consents, tenant consents, market conditions, availability of debt and/or equity financing, etc. Many of these opportunities are in their preliminary stages and may not ultimately come to fruition. This schedule will update as we modify various assumptions and markets conditions change. Square footages and units set forth below are estimates only and ultimately may differ materially from actual square footages and units.
 
 
 
 
 
 
 
 
 
 
 
In-Process Development Projects
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Project Costs (in thousands) (2)
 
 
 
Start
Date
Estimated Completion Date
Estimated Stabilization Date (1)
Estimated Rentable Square Feet
Multifamily Units
Three Months
Cost Incurred to Date
Total Estimated Investment
Estimated Stabilized
Yield (3)
 
 
Ended
Property
Location
March 31, 2015
Office Property:
 
 
 
 
 
 
 
 
 
 
Torrey Reserve III & IV
San Diego, CA
2012
2015
2015
81,500
N/A
$1,650
$33,793
$34,100
8.60%
Torrey Point (previously Sorrento Pointe)
San Diego, CA
2015
2016
2017
88,000
N/A
$60
$7,253
$46,231
8.25% - 9.25%
 
 
 
 
 
 
 
 
 
 
 
Mixed Use Property:
 
 
 
 
 
 
 
 
 
 
Lloyd District Portfolio - Phase I (5)
Portland, OR
2013
2015
2017
47,000
657
$26,473
$161,972
$191,828
6.25% - 7.25%
 
 
 
 
 
 
 
 
 
 
 
Development/Redevelopment Pipeline
 
Property
Property Type
Location
Estimated Rentable
Square Feet
Multifamily Units
 
Solana Beach Corporate Centre (Building 5)
Retail
Solana Beach, CA
10,000
N/A
 
Lomas Santa Fe Plaza
Retail
Solana Beach, CA
45,000
N/A
 
Solana Beach - Highway 101 (4)
Mixed Use
Solana Beach, CA
48,000
36
 
Lloyd District Portfolio - multiple phases (5)
Mixed Use
Portland, OR
TBD
TBD
 

Notes:
(1)
Based on management's estimation of stabilized occupancy (90%).
(2)
For all properties, project costs exclude capitalized interest cost which is calculated in accordance with Accounting Standards Codification 835-20-50-1. In addition, for Torrey Reserve III & IV and Lloyd District Portfolio, project costs exclude allocated land costs.
(3)
The estimated stabilized yield is calculated based on total estimated project costs, as defined above, when the project has reached stabilized occupancy.
(4)
Represents commercial portion of development opportunity for Solana Beach - Highway 101.
(5)
The Lloyd District Portfolio was acquired in 2011 consisting of approximately 600,000 rentable square feet on more than 16 acres located in the Lloyd District of Portland, Oregon. The portion of the property that has been designated for additional development to include a high density, transit oriented, mixed-use urban village, with the potential to be in excess of approximately 3 million square feet. The entitlement for such development opportunity allows a 12:1 Floor Area Ratio with a 250 foot height limit and provides for retail, office and/or multifamily development.  Phase 1 of our development, known as Hassalo on Eighth, comprises approximately 1 million square feet, and is on time and on budget as described in the table above.  Additional development plans are in the early stages and will continue to progress as demand and economic conditions allow.


First Quarter 2015 Supplemental Information
                               Page 20

 
 
 
 
 






PORTFOLIO DATA





First Quarter 2015 Supplemental Information
                               Page 21

 
 
PROPERTY REPORT
 
 

As of March 31, 2015
 
 
 
 
 
Retail and Office Portfolios
 
 
 
 
 
 
 
 
 
 
 
 
Net
 
 
 
 
 
Annualized
 
 
 
 
 
 
 
 
 
 
Number
 
Rentable
 
 
 
 
 
Base Rent
 
 
 
 
 
 
 
 
Year Built/
 
of
 
Square
 
Percentage
 
Annualized
 
per Leased
 
 
 
 
Property
 
Location
 
Renovated
 
Buildings
 
Feet (1)
 
Leased (2)
 
Base Rent (3)
 
Square Foot (4)
 
Retail Anchor Tenant(s) (5)
 
Other Principal Retail Tenants (6)
Retail Properties
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Carmel Country Plaza
 
San Diego, CA
 
1991

 
9

 
78,098

 
96.2%
 
$
3,560,447

 
$47.39
 
 
 
Sharp Healthcare, San Diego County Credit Union
Carmel Mountain Plaza (7)
 
San Diego, CA
 
1994/2014

 
15

 
528,416

 
98.4
 
11,939,976

 
22.96
 
Sears
 
Sports Authority, Saks Fifth Avenue Off 5th
South Bay Marketplace (7)
 
San Diego, CA
 
1997

 
9

 
132,877

 
100.0
 
2,260,482

 
17.01
 
 
 
Ross Dress for Less, Grocery Outlet
Rancho Carmel Plaza
 
San Diego, CA
 
1993

 
3

 
30,421

 
87.7
 
787,946

 
29.53
 
 
 
Oggi's Pizza & Brewing Co., Eagle Estates, Inc
Lomas Santa Fe Plaza
 
Solana Beach, CA
 
1972/1997

 
9

 
209,569

 
93.9
 
5,155,777

 
26.20
 
 
 
Vons, Home Goods
Solana Beach Towne Centre
 
Solana Beach, CA
 
1973/2000/2004

 
12

 
246,730

 
99.3
 
5,917,900

 
24.15
 
 
 
Dixieline Probuild, Marshalls
Del Monte Center (7)
 
Monterey, CA
 
1967/1984/2006

 
16

 
675,678

 
99.2
 
10,228,921

 
15.26
 
Macy's, KLA Monterrey
 
Century Theatres, Macy's Furniture Gallery
Geary Marketplace
 
Walnut Creek, CA
 
2012

 
3

 
35,156

 
100.0
 
1,194,531

 
33.98
 
 
 
Sprouts Farmer Market, Freebirds Wild Burrito
The Shops at Kalakaua
 
Honolulu, HI
 
1971/2006

 
3

 
11,671

 
100.0
 
1,819,860

 
155.93
 
 
 
Hawaii Beachware & Fashion, Diesel U.S.A. Inc.
Waikele Center
 
Waipahu, HI
 
1993/2008

 
9

 
537,637

 
99.8
 
16,727,271

 
31.17
 
Lowe's, Kmart, Sports Authority
 
UFC Gym, Old Navy
Alamo Quarry Market (7)
 
San Antonio, TX
 
1997/1999

 
16

 
589,501

 
98.5
 
13,483,306

 
23.22
 
Regal Cinemas
 
Bed Bath & Beyond, Whole Foods Market
Subtotal/Weighted Average Retail Portfolio
 
 
 
104

 
3,075,754

 
98.5%
 
$
73,076,417

 
$24.12
 
 
 
 
Office Properties
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Torrey Reserve Campus
 
San Diego, CA
 
1996-2000/2014-present

 
12

 
493,435

 
91.6%
 
$
15,983,743

 
$35.36
 
 
 
 
Solana Beach Corporate Centre
 
Solana Beach, CA
 
1982/2005

 
4

 
212,215

 
87.1
 
6,283,909

 
34.00
 
 
 
 
The Landmark at One Market (8)
 
San Francisco, CA
 
1917/2000

 
1

 
419,371

 
100.0
 
20,899,008

 
49.83
 
 
 
 
One Beach Street
 
San Francisco, CA
 
1924/1972/1987/1992

 
1

 
97,614

 
100.0
 
3,080,502

 
31.56
 
 
 
 
First & Main
 
Portland, OR
 
2010

 
1

 
360,641

 
92.9
 
8,812,794

 
26.30
 
 
 
 
Lloyd District Portfolio
 
Portland, OR
 
1940-2011/present

 
6

 
582,203

 
84.5
 
10,444,124

 
21.23
 
 
 
 
City Center Bellevue
 
Bellevue, WA
 
1987

 
1

 
494,781

 
97.9
 
16,977,611

 
35.05
 
 
 
 
Subtotal/Weighted Average Office Portfolio
 
 
 
26

 
2,660,260

 
92.7%
 
$
82,481,691

 
$33.45
 
 
 
 
Total/Weighted Average Retail and Office Portfolio
 
 
 
130

 
5,736,014

 
95.8%
 
$
155,558,108

 
$28.31
 
 
 
 

First Quarter 2015 Supplemental Information
                               Page 22

 
 
PROPERTY REPORT (CONTINUED)
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Average
 
 
 
 
 
 
 
 
 
 
Number
 
 
 
 
 
 
 
Monthly
 
 
 
 
 
 
 
 
Year Built/
 
of
 
 
 
Percentage
 
Annualized
 
Base Rent per
 
 
 
 
Property
 
Location
 
Renovated
 
Buildings
 
Units
 
Leased (2)
 
Base Rent (3)
 
Leased Unit (4)
 
 
 
 
Loma Palisades
 
San Diego, CA
 
1958/2001-2008
 
80

 
548

 
98.5%
 
$
11,178,576

 
$
1,726

 
 
 
 
Imperial Beach Gardens
 
Imperial Beach, CA
 
1959/2008-present
 
26

 
160

 
100.0
 
2,851,668

 
$
1,485

 
 
 
 
Mariner's Point
 
Imperial Beach, CA
 
1986
 
8

 
88

 
98.9
 
1,285,236

 
$
1,231

 
 
 
 
Santa Fe Park RV Resort (9)
 
San Diego, CA
 
1971/2007-2008
 
1

 
126

 
81.0
 
838,920

 
$
685

 
 
 
 
Total/Weighted Average Multifamily Portfolio
 
 
 
115

 
922

 
96.4%
 
$
16,154,400

 
$
1,515

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mixed-Use Portfolio
 
 
 
 
 
 
 
 
Net
 
 
 
 
 
Annualized
 
 
 
 
 
 
 
 
 
 
Number
 
Rentable
 
 
 
 
 
Base Rent
 
 
 
 
 
 
 
 
Year Built/
 
of
 
Square
 
Percentage
 
Annualized
 
per Leased
 
Retail
 
 
Retail Portion
 
Location
 
Renovated
 
Buildings
 
Feet (1)
 
Leased (2)
 
Base Rent (3)
 
Square Foot (4)
 
Anchor Tenant(s) (5)
 
Other Principal Retail Tenants (6)
Waikiki Beach Walk - Retail
 
Honolulu, HI
 
2006
 
3

 
96,707

 
100.0
%
 
$
10,799,806

 
$
111.68

 
 
 
Yard House, Roy's
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Annualized
 
 
 
 
 
 
 
 
 
 
Number
 
 
 
 
 
 
 
Revenue per
 
 
 
 
 
 
 
 
Year Built/
 
of
 
 
 
Average
 
Average
 
Available
 
 
 
 
Hotel Portion
 
Location
 
Renovated
 
Buildings
 
Units
 
Occupancy (10)
 
Daily Rate(10)
 
Room (10)
 
 
 
 
Waikiki Beach Walk - Embassy Suites™
 
Honolulu, HI
 
2008/2014
 
2

 
369

 
89.0
%
 
$
304.64

 
$
271.24

 
 
 
 
Notes:
(1)
The net rentable square feet for each of our retail properties and the retail portion of our mixed-use property is the sum of (1) the square footages of existing leases, plus (2) for available space, the field-verified square footage. The net rentable square feet for each of our office properties is the sum of (1) the square footages of existing leases, plus (2) for available space, management’s estimate of net rentable square feet based, in part, on past leases. The net rentable square feet included in such office leases is generally determined consistently with the Building Owners and Managers Association, or BOMA, 1996 measurement guidelines. Net rentable square footage may be adjusted from the prior periods to reflect re-measurement of leased space at the properties.
(2)
Percentage leased for each of our retail and office properties and the retail portion of the mixed-use property includes square footage under leases as of March 31, 2015, including leases which may not have commenced as of March 31, 2015. Percentage leased for our multifamily properties includes total units rented as of March 31, 2015.
(3)
Annualized base rent is calculated by multiplying base rental payments (defined as cash base rents (before abatements)) for the month ended March 31, 2015 by 12. In the case of triple net or modified gross leases, annualized base rent does not include tenant reimbursements for real estate taxes, insurance, common area or other operating expenses.
(4)
Annualized base rent per leased square foot is calculated by dividing annualized base rent, by square footage under lease as of March 31, 2015. Annualized base rent per leased unit is calculated by dividing annualized base rent by units under lease as of March 31, 2015.
(5)
Retail anchor tenants are defined as retail tenants leasing 50,000 square feet or more.
(6)
Other principal retail tenants are defined as the two tenants leasing the most square footage, excluding anchor tenants.
(7)
Net rentable square feet at certain of our retail properties includes pad sites leased pursuant to the ground leases in the following table:
Property
 
Number of Ground Leases
 
Square Footage Leased Pursuant to Ground Leases
 
Aggregate Annualized Base Rent
Carmel Mountain Plaza
 
6
 
125,477

 
$
1,193,816

South Bay Marketplace
 
1
 
2,824

 
$
91,320

Del Monte Center
 
2
 
295,100

 
$
201,291

Alamo Quarry Market
 
4
 
31,994

 
$
470,075

(8)
This property contains 419,371 net rentable square feet consisting of The Landmark at One Market (375,151 net rentable square feet) as well as a separate long-term leasehold interest in approximately 44,220 net rentable square feet of space located in an adjacent six-story leasehold known as the Annex. We currently lease the Annex from an affiliate of the Paramount Group pursuant to a long-term master lease effective through June 30, 2016, which we have the option to extend until 2031 pursuant to three five-year extension options.
(9)
The Santa Fe Park RV Resort is subject to seasonal variation, with higher rates of occupancy occurring during the summer months. During the 12 months ended March 31, 2015, the highest average monthly occupancy rate for this property was 98%, occurring in July 2014. The number of units at the Santa Fe Park RV Resort includes 122 RV spaces and four apartments.
(10)
Average occupancy represents the percentage of available units that were sold during the three months ended March 31, 2015, and is calculated by dividing the number of units sold by the product of the total number of units and the total number of days in the period. Average daily rate represents the average rate paid for the units sold and is calculated by dividing the total room revenue (i.e., excluding food and beverage revenues or other hotel operations revenues such as telephone, parking and other guest services) for the three months ended March 31, 2015 by the number of units sold. Revenue per available room, or RevPAR, represents the total unit revenue per total available units for the three months ended March 31, 2015 and is calculated by multiplying average occupancy by the average daily rate. RevPAR does not include food and beverage revenues or other hotel operations revenues such as telephone, parking and other guest services.

First Quarter 2015 Supplemental Information
                               Page 23

 
 
RETAIL LEASING SUMMARY
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Lease Summary - Comparable (1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
% of Comparable Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Prior Rent Per Sq. Ft. (3)
 
Annual Change in Rent
 
Cash Basis % Change Over Prior Rent
 
Straight-Line Basis % Change Over Prior Rent
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
11

 
100%
 
25,868

 
$38.85
 
$37.31
 
$
39,807

 
4.1
%
 
7.4
%
 
3.9
 
$
242,280

 
$9.37
4th Quarter 2014
 
11

 
100%
 
36,693

 
$36.26
 
$35.52
 
$
26,917

 
2.1
%
 
8.4
%
 
4.2
 
$
51,235

 
$1.40
3rd Quarter 2014
 
11

 
100%
 
48,420

 
$31.59
 
$27.22
 
$
211,283

 
16.0
%
 
16.8
%
 
4.8
 
$
106,580

 
$2.20
2nd Quarter 2014
 
18

 
100%
 
81,909

 
$31.80
 
$27.78
 
$
329,242

 
14.5
%
 
25.0
%
 
8.3
 
$
2,799,260

 
$34.18
Total 12 months
 
51

 
100%
 
192,890

 
$33.54
 
$30.39
 
$
607,249

 
10.4
%
 
16.6
%
 
6.1
 
$
3,199,355

 
$16.59
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New Lease Summary - Comparable (1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
% of Comparable Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Prior Rent Per Sq. Ft. (3)
 
Annual Change in Rent
 
Cash Basis % Change Over Prior Rent
 
Straight-Line Basis % Change Over Prior Rent
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
3

 
27%
 
9,052

 
$37.62
 
$36.57
 
$
9,482

 
2.9
%
 
8.6
%
 
4.9
 
$
242,280

 
$26.77
4th Quarter 2014
 
—

 
—%
 
—

 
$0.00
 
$0.00
 
$
—

 
—
%
 
—
%
 
—
 
$
—

 
$0.00
3rd Quarter 2014
 
1

 
9%
 
3,650

 
$35.00
 
$27.00
 
$
29,201

 
29.6
%
 
62.3
%
 
10.7
 
$
106,580

 
$29.20
2nd Quarter 2014
 
5

 
28%
 
10,424

 
$36.55
 
$28.23
 
$
86,749

 
29.5
%
 
37.3
%
 
7.6
 
$
669,260

 
$64.20
Total 12 months
 
9

 
18%
 
23,126

 
$36.72
 
$31.30
 
$
125,432

 
17.3
%
 
27.2
%
 
7.0
 
$
1,018,120

 
$44.03
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Renewal Lease Summary - Comparable (1)(5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
% of Comparable Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Prior Rent Per Sq. Ft. (3)
 
Annual Change in Rent
 
Cash Basis % Change Over Prior Rent
 
Straight-Line Basis % Change Over Prior Rent
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
8

 
73%
 
16,816

 
$39.51
 
$37.71
 
$
30,325

 
4.8
%
 
6.7
%
 
3.3
 
$
—

 
$0.00
4th Quarter 2014
 
11

 
100%
 
36,693

 
$36.26
 
$35.52
 
$
26,917

 
2.1
%
 
8.4
%
 
4.2
 
$
51,235

 
$1.40
3rd Quarter 2014
 
10

 
91%
 
44,770

 
$31.31
 
$27.24
 
$
182,082

 
14.9
%
 
13.5
%
 
4.3
 
$
—

 
$0.00
2nd Quarter 2014
 
13

 
72%
 
71,485

 
$31.11
 
$27.71
 
$
242,493

 
12.2
%
 
23.2
%
 
8.4
 
$
2,130,000

 
$29.80
Total 12 months
 
42

 
82%
 
169,764

 
$33.11
 
$30.26
 
$
481,817

 
9.4
%
 
15.2
%
 
5.9
 
$
2,181,235

 
$12.85
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Lease Summary - Comparable and Non-Comparable
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
14

 
39,670

 
$35.10
 
5.5
 
$
1,089,032

 
$27.45
 
 
 
 
 
 
 
 
 
 
4th Quarter 2014
 
14

 
41,696

 
$35.70
 
4.2
 
$
70,030

 
$1.68
 
 
 
 
 
 
 
 
 
 
3rd Quarter 2014
 
12

 
49,920

 
$33.09
 
4.9
 
$
129,080

 
$2.59
 
 
 
 
 
 
 
 
 
 
2nd Quarter 2014
 
25

 
148,960

 
$26.52
 
8.9
 
$
4,712,117

 
$31.63
 
 
 
 
 
 
 
 
 
 
Total 12 months
 
65

 
280,246

 
$30.27
 
7.0
 
$
6,000,259

 
$21.41
 
 
 
 
 
 
 
 
 
 
Notes:
(1)
Comparable leases represent those leases signed on spaces for which there was a previous lease.
(2)
Contractual rent represents contractual minimum rent under the new lease for the first twelve months of the term.
(3)
Prior rent represents the minimum rent paid under the previous lease in the final twelve months of the term.
(4)
Weighted average is calculated on the basis of square footage.
(5)
Excludes renewals at fixed contractual rates specified in the lease.

First Quarter 2015 Supplemental Information
                               Page 24

 
 
OFFICE LEASING SUMMARY
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Lease Summary - Comparable (1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
% of Comparable Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Prior Rent Per Sq. Ft. (3)
 
Annual Change in Rent
 
Cash Basis % Change Over Prior Rent
 
Straight-Line Basis % Change Over Prior Rent
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
12

 
100%
 
50,794

 
$24.84
 
$23.97
 
$
44,486

 
3.7
 %
 
7.9
 %
 
2.1
 
$
51,510

 
$1.01
4th Quarter 2014
 
6

 
100%
 
139,496

 
$30.02
 
$25.10
 
$
686,304

 
19.6
 %
 
31.6
 %
 
8.9
 
$
4,855,903

 
$34.81
3rd Quarter 2014
 
8

 
100%
 
25,358

 
$35.37
 
$34.24
 
$
28,455

 
3.3
 %
 
11.0
 %
 
3.2
 
$
175,132

 
$6.91
2nd Quarter 2014
 
9

 
100%
 
33,680

 
$36.35
 
$38.93
 
$
(87,152
)
 
(6.6
)%
 
(4.8
)%
 
3.4
 
$
203,965

 
$6.06
Total 12 months
 
35

 
100%
 
249,328

 
$30.36
 
$27.67
 
$
672,093

 
9.7
 %
 
17.5
 %
 
6.2
 
$
5,286,510

 
$21.20
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New Lease Summary - Comparable (1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
% of Comparable Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Prior Rent Per Sq. Ft. (3)
 
Annual Change in Rent
 
Cash Basis % Change Over Prior Rent
 
Straight-Line Basis % Change Over Prior Rent
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
2

 
17%
 
2,701

 
$33.60
 
$32.12
 
$
3,996

 
4.6
 %
 
18.7
 %
 
7.5
 
$
51,510

 
$19.07
4th Quarter 2014
 
2

 
33%
 
62,687

 
$27.45
 
$22.18
 
$
330,817

 
23.8
 %
 
58.9
 %
 
15.1
 
$
4,855,903

 
$77.46
3rd Quarter 2014
 
2

 
25%
 
4,737

 
$32.40
 
$35.63
 
$
(15,310
)
 
(9.1
)%
 
(2.6
)%
 
3.0
 
$
65,767

 
$13.88
2nd Quarter 2014
 
4

 
44%
 
14,459

 
$37.94
 
$46.10
 
$
(117,911
)
 
(17.7
)%
 
(20.0
)%
 
4.7
 
$
156,430

 
$10.82
Total 12 months
 
10

 
29%
 
84,584

 
$29.72
 
$27.34
 
$
201,592

 
8.7
 %
 
29.3
 %
 
12.4
 
$
5,129,610

 
$60.64
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Renewal Lease Summary - Comparable (1)(5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
% of Comparable Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Prior Rent Per Sq. Ft. (3)
 
Annual Change in Rent
 
Cash Basis % Change Over Prior Rent
 
Straight-Line Basis % Change Over Prior Rent
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
10

 
83%
 
48,093

 
$24.35
 
$23.51
 
$
40,490

 
3.6
 %
 
7.1
 %
 
1.8
 
$
—

 
$0.00
4th Quarter 2014
 
4

 
67%
 
76,809

 
$32.12
 
$27.49
 
$
355,487

 
16.8
 %
 
12.3
 %
 
3.9
 
$
—

 
$0.00
3rd Quarter 2014
 
6

 
75%
 
20,621

 
$36.05
 
$33.93
 
$
43,765

 
6.3
 %
 
14.3
 %
 
3.2
 
$
109,365

 
$5.30
2nd Quarter 2014
 
5

 
56%
 
19,221

 
$35.15
 
$33.55
 
$
30,759

 
4.8
 %
 
11.9
 %
 
2.3
 
$
47,535

 
$2.47
Total 12 months
 
25

 
71%
 
164,744

 
$30.70
 
$27.84
 
$
470,501

 
10.3
 %
 
11.2
 %
 
3.0
 
$
156,900

 
$0.95
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Lease Summary - Comparable and Non-Comparable
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of Leases Signed
 
Net Rentable Square Feet Signed
 
Contractual Rent Per Sq. Ft. (2)
 
Weighted Average Lease
Term (4)
 
Tenant Improvements & Incentives
 
Tenant Improvements & Incentives Per Sq. Ft.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1st Quarter 2015
 
20

 
90,134

 
$32.78
 
2.9
 
$
853,731

 
$9.47
 
 
 
 
 
 
 
 
 
 
4th Quarter 2014
 
11

 
214,118

 
$30.39
 
9.9
 
$
9,451,166

 
$44.14
 
 
 
 
 
 
 
 
 
 
3rd Quarter 2014
 
14

 
71,751

 
$31.64
 
6.9
 
$
2,344,232

 
$32.67
 
 
 
 
 
 
 
 
 
 
2nd Quarter 2014
 
16

 
76,843

 
$37.23
 
3.2
 
$
1,225,844

 
$15.95
 
 
 
 
 
 
 
 
 
 
Total 12 months
 
61

 
452,846

 
$32.22
 
6.9
 
$
13,874,973

 
$30.64
 
 
 
 
 
 
 
 
 
 
Notes:
(1)
Comparable leases represent those leases signed on spaces for which there was a previous lease.
(2)
Contractual rent represents contractual minimum rent under the new lease for the first twelve months of the term.
(3)
Prior rent represents the minimum rent paid under the previous lease in the final twelve months of the term.
(4)
Weighted average is calculated on the basis of square footage.
(5)
Excludes renewals at fixed contractual rates specified in the lease.

First Quarter 2015 Supplemental Information
                               Page 25

 
 
MULTIFAMILY LEASING SUMMARY
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
Lease Summary - Loma Palisades
 
 
 
 
 
 
Number of Leased Units
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Average Monthly Base Rent per Leased Unit (3)
Quarter
 
 
 
 
1st Quarter 2015
 
540
 
98.5%
 
$11,178,576
 
$1,726
4th Quarter 2014
 
547
 
99.8%
 
$11,098,908
 
$1,691
3rd Quarter 2014
 
548
 
100.0%
 
$10,826,460
 
$1,646
2nd Quarter 2014
 
548
 
100.0%
 
$10,604,556
 
$1,613
 
 
 
 
 
 
 
 
 
Lease Summary - Imperial Beach Gardens
 
 
 
 
 
 
Number of Leased Units
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Average Monthly Base Rent per Leased Unit (3)
Quarter
 
 
 
 
1st Quarter 2015
 
160
 
100.0%
 
$2,851,668
 
$1,485
4th Quarter 2014
 
160
 
100.0%
 
$2,816,928
 
$1,467
3rd Quarter 2014
 
160
 
100.0%
 
$2,812,800
 
$1,465
2nd Quarter 2014
 
160
 
100.0%
 
$2,769,432
 
$1,442
 
 
 
 
 
 
 
 
 
Lease Summary - Mariner's Point
 
 
 
 
 
 
Number of Leased Units
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Average Monthly Base Rent per Leased Unit (3)
Quarter
 
 
 
 
1st Quarter 2015
 
87
 
98.9%
 
$1,285,236
 
$1,231
4th Quarter 2014
 
87
 
98.9%
 
$1,308,828
 
$1,253
3rd Quarter 2014
 
88
 
100.0%
 
$1,276,440
 
$1,209
2nd Quarter 2014
 
88
 
100.0%
 
$1,279,980
 
$1,212
 
 
 
 
 
 
 
 
 
Lease Summary - Santa Fe Park RV Resort
 
 
 
 
 
 
Number of Leased Units
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Average Monthly Base Rent per Leased Unit (3)
Quarter
 
 
 
 
1st Quarter 2015
 
102
 
81.0%
 
$838,920
 
$685
4th Quarter 2014
 
101
 
80.0%
 
$918,696
 
$760
3rd Quarter 2014
 
93
 
74.0%
 
$831,780
 
$743
2nd Quarter 2014
 
115
 
91.0%
 
$1,063,188
 
$773
 
 
 
 
 
 
 
 
 
Total Multifamily Lease Summary
 
 
 
 
 
 
Number of Leased Units
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Average Monthly Base Rent per Leased Unit (3)
Quarter
 
 
 
 
1st Quarter 2015
 
889
 
96.4%
 
$16,154,400
 
$1,515
4th Quarter 2014
 
895
 
97.1%
 
$16,143,360
 
$1,503
3rd Quarter 2014
 
889
 
96.4%
 
$15,747,480
 
$1,476
2nd Quarter 2014
 
911
 
98.8%
 
$15,717,156
 
$1,438
Notes:
(1)
Percentage leased for our multifamily properties includes total units rented as of each respective quarter end date.
(2)
Annualized base rent is calculated by multiplying base rental payments (defined as cash base rents (before abatements)) as of each respective quarter end date.
(3)
Annualized base rent per leased unit is calculated by dividing annualized base rent, by units under lease as of each respective quarter end date.

First Quarter 2015 Supplemental Information
                               Page 26

 
 
MIXED-USE LEASING SUMMARY
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
Lease Summary - Retail Portion
 
 
 
 
 
 
Number of Leased Square Feet
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Annualized base Rent per Leased Square Foot (3)
Quarter
 
 
 
 
1st Quarter 2015
 
96,707
 
100.0%
 
$10,799,806
 
$112
4th Quarter 2014
 
96,334
 
99.6%
 
$10,591,167
 
$110
3rd Quarter 2014
 
96,179
 
99.5%
 
$10,453,280
 
$109
2nd Quarter 2014
 
96,179
 
99.5%
 
$10,461,500
 
$109
 
 
 
 
 
 
 
 
 
Lease Summary - Hotel Portion
 
 
 
 
 
 
Number of Leased Units
 
Average Occupancy (4)
 
Average Daily Rate (4)
 
Annualized Revenue per Available Room (4)
Quarter
 
 
 
 
1st Quarter 2015
 
328
 
89.0%
 
$305
 
$271
4th Quarter 2014
 
264
 
71.6%
 
$318
 
$280
3rd Quarter 2014
 
318
 
86.3%
 
$346
 
$309
2nd Quarter 2014
 
263
 
71.3%
 
$294
 
$262
Notes:
(1)
Percentage leased for mixed-use property includes square footage under leases as of March 31, 2015, including leases which may not have commenced as of March 31, 2015.
(2)
Annualized base rent is calculated by multiplying base rental payments (defined as cash base rents (before abatements)) for the month ended March 31, 2015 by 12. In the case of triple net or modified gross leases, annualized base rent does not include tenant reimbursements for real estate taxes, insurance, common area or other operating expenses.
(3)
Annualized base rent per leased square foot is calculated by dividing annualized base rent, by square footage under lease as of March 31, 2015.
(4)
Average occupancy represents the percentage of available units that were sold during the three months ended March 31, 2015, and is calculated by dividing the number of units sold by the product of the total number of units and the total number of days in the period. Average daily rate represents the average rate paid for the units sold and is calculated by dividing the total room revenue (i.e., excluding food and beverage revenues or other hotel operations revenues such as telephone, parking and other guest services) for each respective quarter period by the number of units sold. Revenue per available room, or RevPAR, represents the total unit revenue per total available units for each respective quarter period and is calculated by multiplying average occupancy by the average daily rate. RevPAR does not include food and beverage revenues or other hotel operations revenues such as telephone, parking and other guest services. Offline rooms in connection with the 2014 room refresh at Embassy Suites Hotel is adjusted for in calculating annualized revenue per available room for the second, third and fourth quarters of 2014.

First Quarter 2015 Supplemental Information
                               Page 27

 
 
LEASE EXPIRATIONS
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assumes no exercise of lease options
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Office
 
Retail
 
Mixed-Use (Retail Portion Only)
 
Total
 
 
 
 
% of
 
% of
 
Annualized
 
 
 
% of
 
% of
 
Annualized
 
 
 
% of
 
% of
 
Annualized
 
 
 
% of
 
Annualized
 
 
Expiring
 
Office
 
Total
 
Base Rent
 
Expiring
 
Retail
 
Total
 
Base Rent
 
Expiring
 
Mixed-Use
 
Total
 
Base Rent
 
Expiring
 
Total
 
Base Rent
Year
 
Sq. Ft.
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
 
Sq. Ft.
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
 
Sq. Ft.
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
Month to Month
 
15,838

 
0.6
%
 
0.3
%
 
$2.81
 
19,353

 
0.6
%
 
0.3
%
 
$6.99
 
1,833

 
1.9
%
 
—
%
 
—
 
37,024

 
0.6
%
 
$4.86
2015
 
240,994

 
9.1

 
4.1

 
$35.64
 
84,701

 
2.8

 
1.5

 
$35.81
 
10,296

 
10.6

 
0.2

 
$231.00
 
335,991

 
5.8

 
$41.67
2016
 
302,519

 
11.4

 
5.2

 
$32.11
 
194,559

 
6.3

 
3.3

 
$34.81
 
11,238

 
11.6

 
0.2

 
$156.37
 
508,316

 
8.7

 
$35.89
2017
 
375,805

 
14.1

 
6.4

 
$36.65
 
379,090

 
12.3

 
6.5

 
$25.17
 
8,908

 
9.2

 
0.2

 
$149.22
 
763,803

 
13.1

 
$32.27
2018
 
203,057

 
7.6

 
3.5

 
$37.83
 
1,051,115

 
34.2

 
18.0

 
$19.72
 
12,416

 
12.8

 
0.2

 
$121.65
 
1,266,588

 
21.7

 
$23.62
2019
 
290,222

 
10.9

 
5.0

 
$40.23
 
362,949

 
11.8

 
6.2

 
$27.07
 
19,955

 
20.6

 
0.3

 
$81.53
 
673,126

 
11.5

 
$34.36
2020
 
289,490


10.9

 
5.0

 
$40.10
 
274,938

 
8.9

 
4.7

 
$16.76
 
19,337

 
20.0

 
0.3

 
$58.44
 
583,765

 
10.0

 
$29.71
2021
 
160,405

 
6.0

 
2.8

 
$44.19
 
54,809

 
1.8

 
0.9

 
$48.69
 
—

 
—

 
—

 
—
 
215,214

 
3.7

 
$45.34
2022
 
20,138

 
0.8

 
0.3

 
$33.77
 
155,684

 
5.1

 
2.7

 
$31.59
 
11,464

 
11.9

 
0.2

 
$74.01
 
187,286

 
3.2

 
$34.42
2023
 
96,281

 
3.6

 
1.7

 
$28.44
 
55,613

 
1.8

 
1.0

 
$24.05
 
—

 
—

 
—

 
—
 
151,894

 
2.6

 
$26.83
2024
 
136,841

 
5.1

 
2.3

 
$31.93
 
220,996

 
7.2

 
3.8

 
$24.06
 
1,260

 
1.3

 
—

 
$174.00
 
359,097

 
6.2

 
$27.59
Thereafter
 
187,074

(2) 
7.0

 
3.2

 
$24.15
 
160,594

 
5.2

 
2.8

 
$26.13
 
—

 
—

 
—

 
—
 
347,668

 
6.0

 
$25.06
Signed Leases Not Commenced
 
146,635

 
5.5

 
2.5

 
—
 
16,334

 
0.5

 
0.3

 
—
 
—

 
—

 
—

 
—
 
162,969

 
2.8

 
—
Available
 
194,961

 
7.3

 
3.3

 
—
 
45,019

 
1.5

 
0.8

 
—
 
—

 
—

 
—

 
—
 
239,980

 
4.1

 
—
Total (3)
 
2,660,260

 
100.0
%
 
45.6
%
 
$31.01
 
3,075,754

 
100.0
%
 
52.7
%
 
$23.76
 
96,707

 
100.0
%
 
1.7
%
 
$111.68
 
5,832,721

 
100.0
%
 
$28.52
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assumes all lease options are exercised
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Office
 
Retail
 
Mixed-Use (Retail Portion Only)
 
Total
 
 
 
 
% of
 
% of
 
Annualized
 
 
 
% of
 
% of
 
Annualized
 
 
 
% of
 
% of
 
Annualized
 
 
 
% of
 
Annualized
 
 
Expiring
 
Office
 
Total
 
Base Rent
 
Expiring
 
Retail
 
Total
 
Base Rent
 
Expiring
 
Mixed-Use
 
Total
 
Base Rent
 
Expiring
 
Total
 
Base Rent
Year
 
Sq. Ft.
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
 
Sq. Ft.
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
 
Sq. Ft.
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
 
Sq. Ft.
 
Sq. Ft.
 
Per Sq. Ft.(1)
Month to Month
 
15,838

 
0.6
%
 
0.3
%
 
$2.81
 
19,353

 
0.6
%
 
0.3
%
 
$6.99
 
1,833

 
1.9
%
 
—
%
 
—
 
37,024

 
0.6
%
 
$4.86
2015
 
158,506

 
6.0

 
2.7

 
$30.13
 
67,710

 
2.2

 
1.2

 
$34.58
 
4,082

 
4.2

 
0.1

 
$189.91
 
230,298

 
3.9

 
$34.27
2016
 
208,293

 
7.8

 
3.6

 
$32.03
 
65,889

 
2.1

 
1.1

 
$30.16
 
7,210

 
7.5

 
0.1

 
$170.75
 
281,392

 
4.8

 
$35.15
2017
 
64,538

 
2.4

 
1.1

 
$37.90
 
130,734

 
4.3

 
2.2

 
$28.62
 
7,868

 
8.1

 
0.1

 
$143.24
 
203,140

 
3.5

 
$36.01
2018
 
66,101

 
2.5

 
1.1

 
$34.97
 
86,196

 
2.8

 
1.5

 
$30.23
 
12,416

 
12.8

 
0.2

 
$121.65
 
164,713

 
2.8

 
$39.02
2019
 
73,740

 
2.8

 
1.3

 
$40.00
 
105,830

 
3.4

 
1.8

 
$31.30
 
8,265

 
8.5

 
0.1

 
$115.14
 
187,835

 
3.2

 
$38.40
2020
 
148,889

 
5.6

 
2.6

 
$35.43
 
134,446

 
4.4

 
2.3

 
$22.59
 
3,015

 
3.1

 
0.1

 
$172.77
 
286,350

 
4.9

 
$30.85
2021
 
89,663

 
3.4

 
1.5

 
$33.78
 
68,722

 
2.2

 
1.2

 
$52.70
 
10,242

 
10.6

 
0.2

 
$207.91
 
168,627

 
2.9

 
$52.07
2022
 
347,689

 
13.1

 
6.0

 
$37.39
 
92,564

 
3.0

 
1.6

 
$36.18
 
11,894

 
12.3

 
0.2

 
$77.84
 
452,147

 
7.8

 
$38.21
2023
 
147,296

 
5.5

 
2.5

 
$43.26
 
144,194

 
4.7

 
2.5

 
$32.19
 
—

 
—

 
—

 
—
 
291,490

 
5.0

 
$37.78
2024
 
109,914

 
4.1

 
1.9

 
$33.44
 
186,592

 
6.1

 
3.2

 
$30.10
 
—

 
—

 
—

 
—
 
296,506

 
5.1

 
$31.34
Thereafter
 
888,197

(2) 
33.4

 
15.2

 
$35.95
 
1,912,171

 
62.2

 
32.8

 
$20.23
 
29,882

 
30.9

 
0.5

 
$54.50
 
2,830,250

 
48.5

 
$25.53
Signed Leases Not Commenced
 
146,635

 
5.5

 
2.5

 
—
 
16,334

 
0.5

 
0.3

 
—
 
—

 
—

 
—

 
—
 
162,969

 
2.8

 
—
Available
 
194,961

 
7.3

 
3.3

 
—
 
45,019

 
1.5

 
0.8

 
—
 
—

 
—

 
—

 
—
 
239,980

 
4.1

 
—
Total (3)
 
2,660,260

 
100.0
%
 
45.6
%
 
$31.01
 
3,075,754

 
100.0
%
 
52.7
%
 
$23.76
 
96,707

 
100.0
%
 
1.7
%
 
$111.68
 
5,832,721

 
100.0
%
 
$28.52

First Quarter 2015 Supplemental Information
                               Page 28

 
 
LEASE EXPIRATIONS (CONTINUED)
 
 

As of March 31, 2015
 
Notes:
(1)
Annualized base rent per leased square foot is calculated by dividing (i) annualized base rent for leases expiring during the applicable period, by (ii) square footage under such expiring leases. Annualized base rent is calculated by multiplying (i) base rental payments (defined as cash base rents (before abatements)) for the month ended March 31, 2015 for the leases expiring during the applicable period by (ii) 12 months.
(2)
The expirations include 36,008 square feet currently leased by multiple tenants at Lloyd District Portfolio through various expiration dates, for which The State of Oregon, by and through its Department of Environmental Quality has signed an agreement to lease such space beginning November 1, 2016 through October 31, 2031 with options to extend the lease through October 31, 2041.
(3)
Individual items may not add up to total due to rounding.

First Quarter 2015 Supplemental Information
                               Page 29

 
 
PORTFOLIO LEASED STATISTICS
 
 


 
 
At March 31, 2015
 
At March 31, 2014
Type
 
Size
 
Leased (1)
 
Leased %
 
Size
 
Leased (1)
 
Leased %
Overall Portfolio (2) Statistics
 
 
 
 
 
 
 
 
 
 
 
 
Retail Properties (square feet)
 
3,075,754

 
3,030,735

 
98.5
%
 
3,067,657

 
2,968,406

 
96.8
%
Office Properties (square feet) 
 
2,660,260

 
2,465,299

 
92.7
%
 
2,644,792

 
2,368,299

 
89.5
%
Multifamily Properties (units)
 
922

 
889

 
96.4
%
 
922

 
888

 
96.3
%
Mixed-Use Properties (square feet)
 
96,707

 
96,707

 
100.0
%
 
96,707

 
95,682

 
98.9
%
Mixed-Use Properties (units)
 
369

 
328

(3) 
89.0
%
 
369

 
333

(3) 
90.2
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-Store(2) Statistics
 
 
 
 
 
 
 
 
 
 
 
 
Retail Properties (square feet)
 
3,075,754

 
3,030,735

 
98.5
%
 
3,067,657

 
2,968,406

 
96.8
%
Office Properties (square feet)
 
1,584,622

(4) 
1,521,288

 
96.0
%
 
1,587,564

(4) 
1,467,114

 
92.4
%
Multifamily Properties (units)
 
922

 
889

 
96.4
%
 
922

 
888

 
96.3
%
Mixed-Use Properties (square feet)
 
96,707

 
96,707

 
100.0
%
 
96,707

 
95,682

 
98.9
%
Mixed-Use Properties (units)
 
369

 
328

(3) 
89.0
%
 
369

 
333

(3) 
90.2
%

Notes:
(1)
Leased square feet includes square feet under lease as of each date, including leases which may not have commenced as of that date. Leased units for our multifamily properties include total units rented as of that date.
(2)
See Glossary of Terms.
(3)
Represents average occupancy for the three months ended March 31, 2015 and 2014.
(4)
The same-store portfolio excludes Torrey Reserve Campus and Lloyd District Portfolio due to significant redevelopment activity.

First Quarter 2015 Supplemental Information
                               Page 30

 
 
TOP TENANTS - RETAIL
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tenant
 
Property(ies)
 
Lease Expiration
 
Total Leased Square Feet
 
Rentable Square Feet as a Percentage of Total Retail
 
Rentable Square Feet as a Percentage of Total
 
Annualized Base Rent
 
Annualized Base Rent as a Percentage of Total Retail
 
Annualized Base Rent as a Percentage of Total
1

Kmart
 
Waikele Center
 
6/30/2018
 
119,590

 
3.9
%
 
2.1
%
 
$
4,544,420

 
6.2
%
 
2.7
%
2

Lowe's
 
Waikele Center
 
5/31/2018
 
155,000

 
5.0

 
2.7

 
4,381,887

 
6.0

 
2.6

3

Sports Authority
 
Waikele Center,
Carmel Mountain Plaza
 
7/18/2018
11/30/2018
 
90,722

 
2.9

 
1.6

 
2,133,950

 
2.9

 
1.3

4

Nordstrom Rack
 
Carmel Mountain Plaza,
Alamo Quarry Market
 
9/30/2022
10/31/2022
 
69,047

 
2.2

 
1.2

 
1,990,316

 
2.7

 
1.2

5

Sprouts Farmers Market
 
Solana Beach Towne Centre,
Carmel Mountain Plaza,
Geary Marketplace
 
6/30/2019
3/31/2025
9/30/2032
 
71,431

 
2.3

 
1.2

 
1,919,436

 
2.6

 
1.2

6

Marshalls
 
Carmel Mountain Plaza,
Solana Beach Towne Centre
 
1/31/2019
1/31/2020
 
68,055

 
2.2

 
1.2

 
1,258,083

 
1.7

 
0.8

7

Old Navy
 
South Bay Marketplace,
Waikele Center,
Alamo Quarry Market
 
4/30/2016
7/31/2016
9/30/2017
 
59,780

 
1.9

 
1.0

 
*

 
*

 
*

8

Vons
 
Lomas Santa Fe Plaza
 
12/31/2017
 
49,895

 
1.6

 
0.9

 
1,216,700

 
1.7

 
0.7

9

Regal Cinemas
 
Alamo Quarry Market
 
3/31/2018
 
72,447

 
2.4

 
1.2

 
1,122,929

 
1.5

 
0.7

10

Gap
 
Del Monte Center,
Waikele Center,
Alamo Quarry Market
 
9/20/2020
2/28/2022
4/30/2024
 
36,614

 
1.2

 
0.6

 
982,039

 
1.3

 
0.6

 
Top 10 Retail Tenants Total
 
 
 
792,581

 
25.6
%
 
13.7
%
 
$
19,549,760

 
26.6
%
 
11.8
%


*
Data withheld at tenant's request.

First Quarter 2015 Supplemental Information
                               Page 31

 
 
TOP TENANTS - OFFICE
 
 

As of March 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tenant
 
Property
 
Lease Expiration
 
Total Leased Square Feet
 
Rentable Square Feet as a Percentage of Total Office
 
Rentable Square Feet as a Percentage of Total
 
Annualized Base Rent
 
Annualized Base Rent as a Percentage of Total Office
 
Annualized Base Rent as a Percentage of Total
1

salesforce.com
 
The Landmark at One Market
 
6/30/2019
4/30/2020
5/31/2021
 
254,118

 
9.6
%
 
4.4
%
 
$
12,969,904

 
15.7
%
 
7.8
%
2

Autodesk, Inc.
 
The Landmark at One Market
 
12/31/2015
12/31/2017
 
114,664

 
4.3

 
2.0

 
5,733,597

 
7.0

 
3.4

3

Veterans Benefits Administration
 
First & Main
 
8/31/2020
 
93,572

 
3.5

 
1.6

 
3,006,453

 
3.6

 
1.8

4

Insurance Company of the West
 
Torrey Reserve Campus
 
12/31/2016
 
81,040

 
3.0

 
1.4

 
2,676,783

 
3.2

 
1.6

5

Alliant International University
 
One Beach Street
 
10/31/2019
 
64,161

 
2.4

 
1.1

 
2,234,739

 
2.7

 
1.3

6

Caradigm USA LLC
 
City Center Bellevue
 
8/14/2017
 
68,956

 
2.6

 
1.2

 
2,231,416

 
2.7

 
1.3

7

Treasury Call Center
 
First & Main
 
8/31/2020
 
63,648

 
2.4

 
1.1

 
2,184,302

 
2.6

 
1.3

8

HDR Engineering, Inc.
 
City Center Bellevue
 
12/31/2017
 
56,024

 
2.1

 
1.0

 
2,044,876

 
2.5

 
1.2

9

Clearesult Operating, LLC (as successor to Portland Energy Conservation)
 
First & Main
 
5/31/2025
 
101,848

 
3.8

 
1.7

 
1,735,638

 
2.1

 
1.0

10

California Bank & Trust
 
Torrey Reserve Campus
 
2/29/2024
 
34,731

 
1.3

 
0.6

 
1,624,153

 
2.0

 
1.0

 
Top 10 Office Tenants Total
 
 
 
932,762

 
35.0
%
 
16.1
%
 
$
36,441,861

 
44.1
%
 
21.7
%



First Quarter 2015 Supplemental Information
                               Page 32

 
 
 
 
 






APPENDIX





First Quarter 2015 Supplemental Information
                               Page 33

 
 
GLOSSARY OF TERMS
 
 


Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA): EBITDA is a non-GAAP measure that means net income or loss plus depreciation and amortization, net interest expense, income taxes, gain or loss on sale of real estate and impairments of real estate, if any. EBITDA is presented because it approximates a key performance measure in our debt covenants, but it should not be considered an alternative measure of operating results or cash flow from operations as determined in accordance with GAAP. The reconciliation of net income to EBITDA for the three months ended March 31, 2015 and 2014 is as follows:
    
 
Three Months Ended
 
March 31,
 
2015
 
2014
Net income
$
11,379

 
$
6,658

Depreciation and amortization
15,107

 
16,341

Interest expense
11,795

 
13,632

Interest income
(14
)
 
(21
)
Income tax expense
84

 
112

EBITDA
$
38,351

 
$
36,722


Funds From Operations (FFO): FFO is a supplemental measure of real estate companies' operating performances. The National Association of Real Estate Investment Trusts (NAREIT) defines FFO as follows: net income, computed in accordance with GAAP plus depreciation and amortization of real estate assets and excluding extraordinary items, gains and losses on sale of real estate and impairment losses. NAREIT developed FFO as a relative measure of performance and liquidity of an equity REIT in order to recognize that the value of income-producing real estate historically has not depreciated on the basis determined under GAAP. However, FFO does not represent cash flows from operating activities in accordance with GAAP (which, unlike FFO, generally reflects all cash effects of transactions and other events in the determination of net income); should not be considered an alternative to net income as an indication of our performance; and is not necessarily indicative of cash flow as a measure of liquidity or ability to pay dividends. We consider FFO a meaningful, additional measure of operating performance primarily because it excludes the assumption that the value of real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. Comparison of our presentation of FFO to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of the NAREIT definition used by such REITs.



First Quarter 2015 Supplemental Information
                               Page 34

 
 
GLOSSARY OF TERMS (CONTINUED)
 
 


Funds Available for Distribution (FAD): FAD is a supplemental measure of our liquidity. We compute FAD by subtracting from FFO As Adjusted tenant improvements, leasing commissions and maintenance capital expenditures, eliminating the net effect of straight-line rents, amortization of above (below) market rents for acquisition properties, the effects of other lease intangibles, adding noncash amortization of deferred financing costs and debt fair value adjustments, adding noncash compensation expense, and adding (subtracting) unrealized losses (gains) on marketable securities. FAD provides an additional perspective on our ability to fund cash needs and make distributions by adjusting FFO for the impact of certain cash and noncash items, as well as adjusting FFO for recurring capital expenditures and leasing costs. However, other REITs may use different methodologies for calculating FAD and, accordingly, our FAD may not be comparable to other REITs.

Net Operating Income (NOI): We define NOI as operating revenues (rental income, tenant reimbursements, lease termination fees, ground lease rental income and other property income) less property and related expenses (property expenses, ground lease expense, property marketing costs, real estate taxes and insurance). NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expense, other nonproperty income and losses, gains and losses from property dispositions, extraordinary items, tenant improvements and leasing commissions. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. Since NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, gains and losses from property dispositions, and extraordinary items, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. However, NOI should not be viewed as an alternative measure of our financial performance since it does not reflect general and administrative expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of the properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact our results from operations.
    
 
Three Months Ended
 
March 31,
Reconciliation of NOI to net income
2015
 
2014
Total NOI
$
43,367

 
$
41,334

General and administrative
(5,016
)
 
(4,612
)
Depreciation and amortization
(15,107
)
 
(16,341
)
Interest expense
(11,795
)
 
(13,632
)
Other income (expense), net
(70
)
 
(91
)
Net income
11,379

 
6,658

Net income attributable to restricted shares
(43
)
 
(70
)
Net loss attributable to unitholders in the Operating Partnership
(3,309
)
 
(1,986
)
Net income attributable to American Assets Trust, Inc. stockholders
$
8,027

 
$
4,602


Overall Portfolio: Includes all operating properties owned by us as of March 31, 2015.


First Quarter 2015 Supplemental Information
                               Page 35

 
 
GLOSSARY OF TERMS (CONTINUED)
 
 


Same-Store Portfolio, Non-Same Store Portfolio and Redevelopment Same-Store: Information provided on a same-store basis includes the results of properties that we owned and operated for the entirety of both periods being compared except for properties for which significant redevelopment or expansion occurred during either of the periods being compared, properties under development, properties classified as held for development and properties classified as discontinued operations. Information provided on a redevelopment same-store basis includes the results of properties undergoing significant redevelopment for the entirety or portion of both periods being compared. The following table shows the properties included in the same-store, non-same store and redevelopment same-store portfolio for the comparative periods presented.
    
 
Comparison of Three Months Ended
 
March 31, 2015 to 2014
 
Same-Store
 
Non Same-Store
 
Redevelopment Same-Store
Retail Properties
 
 
 
 
 
Carmel Country Plaza
X
 
 
 
X
Carmel Mountain Plaza
X
 
 
 
X
South Bay Marketplace
X
 
 
 
X
Rancho Carmel Plaza
X
 
 
 
X
Lomas Santa Fe Plaza
X
 
 
 
X
Solana Beach Towne Centre
X
 
 
 
X
Del Monte Center
X
 
 
 
X
Geary Marketplace
X
 
 
 
X
The Shops at Kalakaua
X
 
 
 
X
Waikele Center
X
 
 
 
X
Alamo Quarry Market
X
 
 
 
X
Office Properties
 
 
 
 
 
Torrey Reserve Campus
 
 
X
 
X
Solana Beach Corporate Centre
X
 
 
 
X
The Landmark at One Market
X
 
 
 
X
One Beach Street
X
 
 
 
X
First & Main
X
 
 
 
X
Lloyd District Portfolio
 
 
X
 
X
City Center Bellevue
X
 
 
 
X
Multifamily Properties
 
 
 
 
 
Loma Palisades
X
 
 
 
X
Imperial Beach Gardens
X
 
 
 
X
Mariner's Point
X
 
 
 
X
Santa Fe Park RV Resort
X
 
 
 
X
Mixed-Use Properties
 
 
 
 
 
Waikiki Beach Walk - Retail
X
 
 
 
X
Waikiki Beach Walk - Embassy Suites™
X
 
 
 
X
Development Properties
 
 
 
 
 
Torrey Point (formerly Sorrento Pointe) - Land
 
 
X
 
 
Torrey Reserve - Land
 
 
X
 
 
Solana Beach Corporate Centre - Land
 
 
X
 
 
Solana Beach - Highway 101 - Land
 
 
X
 
 
Lloyd District Portfolio - Land
 
 
X
 
 
Tenant Improvements and Incentives: Represents not only the total dollars committed for the improvement (fit-out) of a space as it relates to a specific lease but may also include base building costs (i.e. expansion, escalators, new entrances, etc.) which are required to make the space leasable. Incentives include amounts paid to tenants as an inducement to sign a lease that do not represent building improvements.

First Quarter 2015 Supplemental Information
                               Page 36