Arizona (October 28, 2019) – Healthcare Trust of America, Inc. (NYSE: HTA)
(“HTA”) announced results for the three and nine months ended September 30,
2019 results consist of a net loss attributable to common stockholders of
$(0.04) per diluted share, which included a ($0.10) per share charge related to
the refinancing of the 2021 and 2022 Senior Notes, Normalized FFO of $0.42 per
diluted share, and Same-Property Cash NOI growth of 2.5%. In the quarter, HTA completed $135.5 million
in acquisitions, announced two new developments totaling $90.0 million, and
refinanced $900.0 million in debt at 3.05% per annum blended interest rates. As
a result of this performance, HTA is adjusting its EPS guidance to account for
the debt extinguishment costs, while reiterating its normalized FFO guidance,
increasing its midpoint for full year same store growth, and increasing the
volume of acquisitions as outlined below.
third quarter, HTA demonstrated its ability to drive both internal and external
growth while strengthening its fortress balance sheet and positioning itself
for the future,” stated Chairman, CEO and President Scott D. Peters.
“Our operating results demonstrate the power of our company. We have a best-in-class portfolio
concentrated in key markets, and an operating platform that can create value for
our tenants and shareholders through operations, development, and
Third Quarter 2019:
Sheet and Capital Markets
of Topic 842 Leases
For 2019, HTA updated its earnings, same-property cash NOI
growth, and FFO per share, as defined by NAREIT, guidance as outlined below:
The changes to net income
and NAREIT FFO reflect the debt extinguishment costs incurred in the third
quarter. In addition, HTA now expects to complete $375 to $425 million of
investments in 2019 at average yields between 5.5% and 6.0%.
In October 2019, under its ATM offering program, HTA
entered into a forward sale arrangement in which it would issue approximately
6.0 million shares of common stock to receive anticipated net proceeds of
approximately $172.7 million prior to October 2020, subject to adjustments as
provided in the forward equity agreement. We anticipate using these net
proceeds to fund purchases of additional MOBs and for general corporate
Healthcare Trust of America, Inc.
Trust of America, Inc. (NYSE: HTA) is the largest dedicated owner and operator
of MOBs in the United States, comprising approximately 23.7 million square feet
of GLA, with $7.0 billion invested primarily in MOBs. HTA provides real estate infrastructure for
the integrated delivery of healthcare services in highly-desirable
locations. Investments are targeted to
build critical mass in 20 to 25 leading gateway markets that generally have
leading university and medical institutions, which translates to superior
demographics, high-quality graduates, intellectual talent and job growth. The strategic markets HTA invests in support
a strong, long-term demand for quality medical office space. HTA utilizes an integrated asset management
platform consisting of on-site leasing, property management, engineering and
building services, and development capabilities to create complete, state of
the art facilities in each market. This
drives efficiencies, strong tenant and health system relationships, and strategic
partnerships that result in high levels of tenant retention, rental growth and
long-term value creation. Headquartered
in Scottsdale, Arizona, HTA has developed a national brand with dedicated
relationships at the local level.
2006 and listed on the New York Stock Exchange in 2012, HTA has produced
attractive returns for its stockholders that have outperformed the S&P 500
and US REIT index. More information
about HTA can be found on the Company’s Website (www.htareit.com), Facebook,
LinkedIn and Twitter.
This press release contains certain forward-looking
statements with respect to HTA.
Forward-looking statements are statements that are not descriptions of
historical facts and include statements regarding management’s intentions,
beliefs, expectations, plans or predictions of the future, within the meaning
of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Because such statements include risks,
uncertainties and contingencies, actual results may differ materially and in
adverse ways from those expressed or implied by such forward-looking
statements. These risks, uncertainties
and contingencies include, without limitation, the following: changes in
economic conditions generally and the real estate market specifically;
legislative and regulatory changes, including changes to laws governing the
taxation of REITs and changes to laws governing the healthcare industry; the
availability of capital; changes in interest rates; competition in the real
estate industry; the supply and demand for operating properties in our proposed
market areas; changes in accounting principles generally accepted in the United
States of America; policies and guidelines applicable to REITs; the
availability of properties to acquire; and the availability of financing. Additional information concerning us and our
business, including additional factors that could materially and adversely
affect our financial results, include, without limitation, the risks described
under Part I, Item 1A – Risk Factors, in our 2018 Annual Report on Form
10-K and in our filings with the SEC.
HTA will host a conference call and webcast on
Tuesday, October 29, 2019 at 12:00 p.m. Eastern Time (9:00 a.m. Pacific Time)
to review its financial performance and operating results for the three and
nine months ended September 30, 2019.
Conference Call and Webcast Details:
Domestic Dial-In Number: (877)
International Dial-In Number: (412)
Canada Dial-In Number: (855)
Webcast: www.htareit.com under the
Investor Relations tab
Replay Conference Call Details:
Domestic Dial-In Number: (877)
International Dial-In Number: (412)
Canada Dial-In Number: (855)
Conference ID: 10135781
Available October 29, 2019 (one
hour after the end of the conference call) to November 29, 2019 at 12:00 p.m.
Eastern Time (9:00 a.m. Pacific Time)
(1) Same-Property includes 407 and 405 buildings for the three and nine months ended September 30, 2019 and 2018, respectively.
NOI is a non-GAAP financial measure that is defined as
net income or loss (computed in accordance with GAAP) before: (i) general and
administrative expenses; (ii) transaction expenses; (iii) depreciation and
amortization expense; (iv) impairment; (v) interest expense and net change in
fair value of derivative financial instruments; (vi) gain or loss on sales of
real estate; (vii) gain or loss on extinguishment of debt; (viii) income or
loss from unconsolidated joint venture; and (ix) other income or expense. HTA believes that NOI provides an accurate
measure of the operating performance of its operating assets because NOI
excludes certain items that are not associated with the management of its
properties. Additionally, HTA believes
that NOI is a widely accepted measure of comparative operating performance of
real estate investment trusts (“REITs”).
However, HTA’s use of the term NOI may not be comparable to that of
other REITs as they may have different methodologies for computing this amount. NOI should not be considered as an
alternative to net income or loss (computed in accordance with GAAP) as an
indicator of HTA’s financial performance.
NOI should be reviewed in connection with other GAAP measurements.
Cash NOI is a non-GAAP financial measure which
excludes from NOI: (i) straight-line rent adjustments; (ii) amortization of
below and above market leases/leasehold interests and other GAAP adjustments;
and (iii) notes receivable interest income.
Contractual base rent, contractual rent increases, contractual rent
concessions and changes in occupancy or lease rates upon commencement and
expiration of leases are a primary driver of HTA’s revenue performance. HTA believes that Cash NOI, which removes the
impact of straight-line rent adjustments, provides another measurement of the
operating performance of its operating assets.
Additionally, HTA believes that Cash NOI is a widely accepted measure of
comparative operating performance of REITs.
However, HTA’s use of the term Cash NOI may not be comparable to that of
other REITs as they may have different methodologies for computing this
amount. Cash NOI should not be
considered as an alternative to net income or loss (computed in accordance with
GAAP) as an indicator of its financial performance. Cash NOI should be reviewed in connection
with other GAAP measurements.
To facilitate the comparison of Cash NOI between
periods, HTA calculates comparable amounts for a subset of its owned and
operational properties referred to as “Same-Property”. Same-Property Cash NOI excludes (i) properties
which have not been owned and operated by HTA during the entire span of all
periods presented and disposed properties, (ii) HTA’s share of unconsolidated
joint ventures, (iii) development, redevelopment and land parcels, (iv)
properties intended for disposition in the near term which have (a) been
approved by the Board of Directors, (b) are actively marketed for sale, and (c)
an offer has been received at prices HTA would transact and the sales process
is ongoing, and (v) certain non-routine items.
Same-Property Cash NOI should not be considered as an alternative to net
income or loss (computed in accordance with GAAP) as an indicator of its
financial performance. Same-Property
Cash NOI should be reviewed in connection with other GAAP measurements.
HTA computes FFO in accordance with the current
standards established by NAREIT. NAREIT
defines FFO as net income or loss attributable to common stockholders (computed
in accordance with GAAP), excluding gains or losses from sales of real estate
property and impairment write-downs of depreciable assets, plus depreciation
and amortization related to investments in real estate, and after adjustments for
unconsolidated partnerships and joint ventures.
Because FFO excludes depreciation and amortization unique to real
estate, among other items, it provides a perspective not immediately apparent
from net income or loss attributable to common stockholders.
HTA computes Normalized FFO, which excludes from FFO:
(i) transaction expenses; (ii) gain or loss on extinguishment of debt; (iii)
noncontrolling income or loss from OP Units included in diluted shares; and
(iv) other normalizing items, which include items that are unusual and
infrequent in nature. HTA’s methodology
for calculating Normalized FFO may be different from the methods utilized by
other REITs and, accordingly, may not be comparable to other REITs.
HTA also computes Normalized FAD, which excludes from
Normalized FFO: (i) non-cash compensation expense; (ii) straight-line rent
adjustments; (iii) amortization of below and above market leases/leasehold
interests and corporate assets; (iv) deferred revenue – tenant improvement
related and other income; (v) amortization of deferred financing costs and debt
premium/discount; and (vi) recurring capital expenditures, tenant improvements
and leasing commissions. HTA believes
this non-GAAP financial measure provides a meaningful supplemental measure of
its operating performance. Normalized
FAD should not be considered as an alternative to net income or loss
attributable to common stockholders (computed in accordance with GAAP) as an
indicator of its financial performance, nor is it indicative of cash available
to fund cash needs. Normalized FAD
should be reviewed in connection with other GAAP measurements.
HTA presents these non-GAAP financial measures because
it considers them important supplemental measures of its operating performance
and believes they are frequently used by securities analysts, investors and
other interested parties in the evaluation of REITs. Historical cost accounting assumes that the
value of real estate assets diminishes ratably over time. Since real estate values have historically
risen or fallen based on market conditions, many industry investors have
considered the presentation of operating results for real estate companies that
use historical cost accounting to be insufficient by themselves. These non-GAAP financial measures should not
be considered as alternatives to net income or loss attributable to common
stockholders (computed in accordance with GAAP) as indicators of its financial
performance. FFO and Normalized FFO is
not indicative of cash available to fund cash needs. These non-GAAP financial measures should be
reviewed in connection with other GAAP measurements.
by NAREIT, EBITDAre is computed as
net income or loss (computed in accordance with GAAP) plus: (i) interest
expense; (ii) income tax expense (not applicable to HTA); (iii) depreciation
and amortization; (iv) impairment; (v) gain or loss on the sale of real estate;
and (vi) and the proportionate share of joint venture depreciation and
EBITDAre is presented on an assumed
annualized basis. HTA defines Adjusted
EBITDAre as EBITDAre (computed in accordance with NAREIT
as defined above) plus: (i) transaction expenses; (ii) gain or loss on
extinguishment of debt; (iii) non-cash compensation expense; (iv) pro forma
impact of its acquisitions/dispositions; and (v) other normalizing items. HTA considers Adjusted EBITDAre an important measure because it
provides additional information to allow management, investors, and its current
and potential creditors to evaluate and compare its core operating results and
its ability to service debt.