View:
Download DOC
Download PDF
Download XLS
4Q13 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):
February 18, 2014
_________________________
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 February 18, 2014, American Assets Trust, Inc. (the “Company”) issued a press release regarding its financial results for the quarter and fiscal year ending December 31, 2013. Also on February 18, 2014, 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 and fiscal year ending December 31, 2013. 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 and fiscal year ending December 31, 2013 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 February 18, 2014.
99.2**
 
American Assets Trust, Inc. Supplemental Information for the period ended December 31, 2013.
_____________________
** 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
February 18, 2014
 
 

3




EXHIBIT INDEX
Exhibit Number
 
Exhibit Description
99.1
 
Press release issued by American Assets Trust, Inc. on February 18, 2014.
99.2
 
American Assets Trust, Inc. Supplemental Information for the period ended December 31, 2013.


4
4Q13 Earnings Release



American Assets Trust, Inc. Reports Fourth Quarter and Year-End 2013 Financial Results

FFO per share increases 5% and 14% year-over-year for the three months and year ended December 31, 2013
Same-store cash NOI increases 4% and 6% year-over-year for the three months and year ended December 31, 2013

SAN DIEGO, California - 2/18/2014 - American Assets Trust, Inc. (NYSE: AAT) (the “Company”) today reported financial results for its fourth quarter and year-ended December 31, 2013.

Financial Results and Recent Developments
•
Funds From Operations increased 5% and 14% to $0.40 and $1.54 per diluted share for the three months and year ended December 31, 2013, respectively, compared to the same periods in 2012
•
Net income available to common stockholders of $4.7 million and $15.2 million for the three months and year ended December 31, 2013, respectively, or $0.11 and $0.38 per diluted share, respectively
•
Same-store cash NOI increased 4% and 6% for the three months and year ended December 31, 2013, respectively, compared to the same periods in 2012
•
Embassy Suites—Waikiki Beach WalkTM increased Revenue per Available Room by 7% and 11% for the three months and year ended December 31, 2013, respectively, compared to the same periods in 2012
•
Signed 44 retail and office leases for approximately 326,700 square feet

During the fourth quarter of 2013, the Company generated funds from operations (“FFO”) for common stockholders of $23.0 million, or $0.40 per diluted share, compared to $21.7 million, or $0.38 per diluted share, for the quarter ended December 31, 2012. For the year ended December 31, 2013, the Company generated FFO for common stockholders of $89.0 million, or $1.54 per diluted share, compared to $77.5 million, or $1.35 per diluted share, for the year ended December 31, 2012. The increase in FFO from the corresponding period in 2012 was largely due to additional operating income from our 2012 acquisitions, primarily City Center Bellevue and Geary Marketplace.

Net income attributable to common stockholders was $4.7 million, or $0.11 per basic and diluted share, for the three months ended December 31, 2013 compared to $28.6 million, or $0.73 per basic and diluted share, for the three months ended December 31, 2012. For the year ended December 31, 2013, net income attributable to common stockholders was $15.2 million, or $0.38 per basic and diluted share, compared to net income attributable to common stockholders of $34.9 million, or $0.90 per basic and diluted share, for the year ended December 31, 2012. The decrease in net income attributable to common stockholders was largely due to the sale of 160 King Street during the fourth quarter of 2012.

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:
 
December 31, 2013
September 30, 2013
December 31, 2012
Total Portfolio
 
 
 
Retail
97.0%
95.6%
97.0%
Office
89.8%
91.4%
93.3%
Multifamily
96.4%
96.7%
94.7%
Mixed-Use:
 
 
 
Retail
97.8%
97.9%
95.5%
Hotel
87.2%
88.7%
88.9%
 
 
 
 
Same-Store Portfolio
 
 
Retail
97.0%
95.5%
96.9%
Office
91.6%
96.9%
98.2%
Multifamily
96.4%
96.7%
94.7%
Mixed-Use:
 
 
 
Retail
97.8%
97.9%
95.5%
Hotel
87.2%
88.7%
88.9%

During the fourth quarter of 2013, the Company signed 44 leases for approximately 326,700 square feet of retail and office space, as well as 184 multifamily apartment leases. Renewals accounted for 71.4% of the comparable retail leases, 68.8% of the comparable office leases and 55.4% of the residential leases.

Retail and Office
On a comparable space basis (i.e., leases for which there was a former tenant) during the fourth quarter of 2013, our retail and office leasing spreads are shown below:
Q4 2013
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
14
79,000
—%
$36.61
$36.60
6.4%
Office
16
163,000
(0.4)%
$28.76
$28.89
12.3%

Multifamily
At December 31, 2013, the average monthly base rent per leased unit was $1,422 compared to an average monthly base rent per leased unit of $1,399 at December 31, 2012.


2


Same-Store Operating Income
For the three months and year ended December 31, 2013, same-store property operating income increased 3.7% and 6.4%, respectively, on a cash basis compared to the corresponding periods in 2012. For the three months and year ended December 31, 2013, same-store property operating income increased 0.5% and 4.3%, respectively, on a GAAP basis compared to the corresponding periods in 2012. The same-store property operating income by segment was as follows (in thousands):
 
Three Months Ended (1)
 
 
 
 
Year Ended (2)
 
 
 
 
December 31,
 
 
 
 
December 31,
 
 
 
 
2013
 
2012
 
Change
 
2013
 
2012
 
Change
Cash Basis:
 
 
 
 
 
 
 
 
 
 
 
 
 
Retail
$
17,301

 
$
17,676

 
(2.1
)
%
 
$
68,049

 
$
65,270

 
4.3

%
Office
9,967

 
8,867

 
12.4

 
 
25,430

 
24,250

 
4.9

 
Multifamily
2,587

 
2,418

 
7.0

 
 
10,208

 
8,938

 
14.2

 
Mixed-Use
4,837

 
4,491

 
7.7

 
 
21,908

 
19,572

 
11.9

 
 
$
34,692

 
$
33,452

 
3.7

%
 
$
125,595

 
$
118,030

 
6.4

%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
GAAP Basis:
 
 
 
 
 
 
 
 
 
 
 
 
 
Retail
$
17,535

 
$
17,827

 
(1.6
)
%
 
$
68,311

 
$
67,063

 
1.9

%
Office
11,180

 
11,286

 
(0.9
)
 
 
27,816

 
27,489

 
1.2

 
Multifamily
2,587

 
2,418

 
7.0

 
 
10,208

 
8,938

 
14.2

 
Mixed-Use
4,771

 
4,371

 
9.2

 
 
21,475

 
19,057

 
12.7

 
 
$
36,073

 
$
35,902

 
0.5

%
 
$
127,810

 
$
122,547

 
4.3

%
(1)
Same-store portfolio excludes (i) 2012 acquisition of Geary Marketplace, (ii) Torrey Reserve Campus and Lloyd District Portfolio due to significant redevelopment activity during the period and (iii) land held for development.
(2)
Same-store portfolio excludes (i) 2012 acquisitions of One Beach Street, City Center Bellevue and Geary Marketplace, (ii) Torrey Reserve Campus and Lloyd District Portfolio due to significant redevelopment activity during the period and (iii) land held for development.

On a same-store basis, retail property operating income decreased for the three months ended December 31, 2013 compared to the three months ended December 31, 2012 primarily due to the expiration of the Ross Dress for Less lease at Lomas Santa Fe Plaza on January 31, 2013 and a lease amendment fee paid by a tenant at Rancho Carmel Plaza during the fourth quarter of 2012.

On a same-store basis, retail property operating income increased for the year ended December 31, 2013 compared to the corresponding period in 2012 primarily due to a decrease in property tax expense, substantially related to tax refunds received for Lomas Santa Fe Plaza and Alamo Quarry Market. The increase was also attributed to supplemental property taxes for fiscal year 2011 that were paid during 2012.

On a same-store basis, office property operating income increased for the three months ended December 31, 2013 compared to the three months ended December 31, 2012 due to the expiration of rent abatements for tenants at City Center Bellevue. The increase was offset by higher real estate taxes primarily related to higher tax assessments and a decrease in tenant tax exemptions during the three months ended December 31, 2013.

On a same-store basis, office property operating income increased for the year ended December 31, 2013 compared to the corresponding period in 2012 primarily due to the expiration of above-market leases at the Landmark at One Market. The increase was also attributed to supplemental property taxes for fiscal year 2011 that were paid during 2012.

On a same-store basis, multifamily property operating income increased for the three months and year ended December 31, 2013 compared to the corresponding periods in 2012 primarily due to an increase in average occupancy during 2013 and an increase in monthly base rent per leased unit.

On a same-store basis, mixed-use property operating income increased for the three months and year ended December 31, 2013 compared to the corresponding periods in 2012 primarily due to higher revenue per available room of $239 and $261, respectively, for the three months and year ended December 31, 2013 compared to $223 and $235, respectively, for the three months and year ended December 31, 2012.

3


Development
Our redevelopment efforts at Lloyd District Portfolio and Torrey Reserve Campus are ongoing. Both projects remain within budget and on schedule, with the newly completed building at Torrey Reserve Campus being ahead of schedule on leasing activity. Projected costs of the redevelopment at Lloyd District Portfolio are approximately $192 million, of which approximately $31 million has been incurred to date. We expect to incur the remaining costs for redevelopment of the Lloyd District Portfolio in 2014 and 2015. Projected costs of the redevelopment at Torrey Reserve Campus are approximately $34 million, of which approximately $20 million has been incurred to date. We expect to incur the remaining costs for this project in 2014.

Our redevelopment and development opportunities are subject to market conditions and may not ultimately come to fruition.

Credit Facility
On January 9, 2014, we entered into an amended and restated credit agreement, which provides for aggregate, unsecured borrowing of $350 million, consisting of a revolving line of credit of $250 million and a term loan of $100 million. The revolver loan and term loan initially mature on January 9, 2018 and January 9, 2016, respectively, with extension options through January 9, 2019 that are exercisable by us subject to the satisfaction of certain conditions.

Concurrent with the closing of the amended and restated credit facility, we drew down on the entirety of the $100 million term loan and entered into an interest rate swap agreement that is intended to fix the interest rate associated with the term loan at approximately 3.08% through its maturity date and extension options, subject to adjustments based on our consolidated leverage ratio.

Balance Sheet and Liquidity
At December 31, 2013, the Company had gross real estate assets of $2.0 billion and liquidity of $178.3 million, comprised of cash and cash equivalents of $49.0 million and approximately $129.3 million of availability on its line of credit.

For the three months ended December 31, 2013, we issued 22,738 shares of common stock through the ATM equity program at a weighted average price per share of $32.25, resulting in net proceeds of $0.6 million. For the year ended December 31, 2013, we issued 741,452 shares of common stock through the ATM equity program at a weighted average price per share of $35.00, resulting in net proceeds of $24.9 million. As of December 31, 2013, we had the capacity to issue up to an additional $124.0 million in shares of common stock under our ATM equity program. Actual future sales will depend on a variety of factors including, but not limited to, market conditions, the trading price of our common stock and our capital needs. We have no obligation to sell the remaining shares available for sale under the ATM equity program.

Dividends
The Company declared dividends on its shares of common stock of $0.22 per share for the fourth quarter of 2013. The dividends were paid on December 27, 2013.

In addition, the Company has declared a dividend on its common stock of $0.22 per share for the quarter ending March 31, 2014. The dividend will be paid on March 28, 2014 to stockholders of record on March 14, 2014.

4


Guidance
The Company's guidance for full year 2014 FFO per diluted share is a range of $1.54 to $1.62 per share. The Company's guidance excludes any impact from future acquisitions, dispositions, equity issuances or repurchases, debt financings or repayments. 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 fourth quarter and year end 2013 on Wednesday, February 19, 2014 at 8:00 a.m. Pacific Time (“PT”). To participate in the event by telephone, please dial 1-866-318-8615 and use the pass code 75494535. A telephonic replay of the conference call will be available beginning at 12:00 p.m. PT on Wednesday, February 19, 2014 through Wednesday, February 26, 2014. To access the replay, dial 1-888-286-8010 and use the pass code 42861311. 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 fourth quarter 2013 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)
 
December 31, 2013
 
December 31, 2012
Assets
 
 
 
 
 

Real estate, at cost
 
 

 
 
 

Operating real estate
$
1,919,015

 
$
1,891,549

Construction in progress
 
67,389

 
 
32,183

Held for development
 
9,013

 
 
14,944

 
 
1,995,417

 
 
1,938,676

Accumulated depreciation
 
(318,581
)
 
 
(270,494
)
Net real estate
 
1,676,836

 
 
1,668,182

Cash and cash equivalents
 
48,987

 
 
42,479

Restricted cash
 
9,124

 
 
7,421

Accounts receivable, net
 
7,295

 
 
6,440

Deferred rent receivables, net
 
32,531

 
 
29,395

Other assets, net
 
57,670

 
 
73,670

Total assets
$
1,832,443

 
$
1,827,587

Liabilities and equity
 
 

 
 
 

Liabilities:
 
 

 
 
 

Secured notes payable
$
952,174

 
$
1,044,682

Line of credit
 
93,000

 
 
—

Accounts payable and accrued expenses
 
37,063

 
 
29,509

Security deposits payable
 
5,163

 
 
4,856

Other liabilities and deferred credits
 
58,465

 
 
62,811

Total liabilities
 
1,145,865

 
 
1,141,858

Commitments and contingencies
 
 

 
 
 

Equity:
 
 

 
 
 

American Assets Trust, Inc. stockholders' equity
 
 
 
 
 
Common stock, $0.01 par value, 490,000,000 shares authorized, 40,512,563 and 39,664,212 shares issued and outstanding at December 31, 2013 and 2012, respectively
 
405

 
 
397

Additional paid-in capital
 
692,196

 
 
663,589

Accumulated dividends in excess of net income
 
(44,090
)
 
 
(25,625
)
Total American Assets Trust, Inc. stockholders' equity
 
648,511

 
 
638,361

Noncontrolling interests
 
38,067

 
 
47,368

Total equity
 
686,578

 
 
685,729

Total liabilities and equity
$
1,832,443

 
$
1,827,587


6


American Assets Trust, Inc.
Unaudited Consolidated Statements of Income
(In Thousands, Except Shares and Per Share Data)
 
Three Months Ended December 31,
 
Year Ended December 31,
 
2013
 
2012
 
2013
 
2012
Revenue:
 
 
 
 
 
 
 
Rental income
$
61,425

 
$
60,191

 
$
242,757

 
$
225,249

Other property income
3,220

 
2,929

 
12,300

 
10,217

Total revenue
64,645

 
63,120

 
255,057

 
235,466

Expenses:
 
 
 
 
 
 
 
Rental expenses
18,206

 
17,287

 
68,608

 
64,089

Real estate taxes
5,334

 
4,947

 
21,378

 
22,025

General and administrative
4,537

 
4,063

 
17,195

 
15,593

Depreciation and amortization
16,161

 
16,576

 
66,775

 
61,853

Total operating expenses
44,238

 
42,873

 
173,956

 
163,560

Operating income
20,407

 
20,247

 
81,101

 
71,906

Interest expense
(13,776
)
 
(15,152
)
 
(58,020
)
 
(57,328
)
Other income (expense), net
276

 
(273
)
 
(487
)
 
(629
)
Income from continuing operations
6,907

 
4,822

 
22,594

 
13,949

Discontinued operations
 
 
 
 
 
 
 
Income from discontinued operations
—

 
279

 
—

 
932

Gain on sale of real estate property
—

 
36,720

 
—

 
36,720

Results from discontinued operations
—

 
36,999

 
—

 
37,652

Net income
6,907

 
41,821

 
22,594

 
51,601

Net income attributable to restricted shares
(139
)
 
(133
)
 
(536
)
 
(529
)
Net income attributable to unitholders in the Operating Partnership
(2,086
)
 
(13,111
)
 
(6,838
)
 
(16,133
)
Net income attributable to American Assets Trust, Inc. stockholders
$
4,682

 
$
28,577

 
$
15,220

 
$
34,939

Basic income from continuing operations attributable to common stockholders per share
$
0.11

 
$
0.08

 
$
0.38

 
$
0.24

Basic income from discontinued operations attributable to common stockholders per share
—

 
0.65

 
—

 
0.66

Basic income attributable to common stockholders per share
$
0.11

 
$
0.73

 
$
0.38

 
$
0.90

Weighted average shares of common stock outstanding - basic
39,836,104

 
38,952,816

 
39,539,457

 
38,736,113

Diluted income from continuing operations attributable to common stockholders per share
$
0.11

 
$
0.08

 
$
0.38

 
$
0.24

Diluted income from discontinued operations attributable to common stockholders per share
—

 
0.65

 
—

 
0.66

Diluted income attributable to common stockholders per share
$
0.11

 
$
0.73

 
$
0.38

 
$
0.90

Weighted average shares of common stock outstanding - diluted
57,788,365

 
57,054,425

 
57,515,810

 
57,053,909

Dividends declared per common share
$
0.22

 
$
0.21

 
$
0.85

 
$
0.84



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
 
Year Ended
 
December 31, 2013
 
December 31, 2013
Funds From Operations (FFO)
 
 
 
 
 
Net income
$
6,907

 
$
22,594

Depreciation and amortization of real estate assets
 
16,161

 
 
66,775

FFO, as defined by NAREIT
$
23,068

 
$
89,369

Less: Nonforfeitable dividends on incentive stock awards
 
(92
)
 
 
(357
)
FFO attributable to common stock and units
$
22,976

 
$
89,012

FFO per diluted share/unit
$
0.40

 
$
1.54

Weighted average number of common shares and units, diluted
 
57,998,249

 
 
57,726,012


Reported results are preliminary and not final until the filing of the Company's Form 10-K 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 2.6 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
4Q13 Supplemental exibit

 
 
 
FOURTH QUARTER 2013
 
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
 
1,217,923

 
688,185

 
922

(1)
—

 
—

 
 
 
 
 
 
 
 
 
 
 
San Francisco
 
35,156

 
519,548

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Oahu
 
549,399

 
—

 
—

 
96,707

 
369

 
 
 
 
 
 
 
 
 
 
 
Monterey
 
675,678

 
—

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
San Antonio
 
589,501

 
—

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Portland
 
—

 
942,021

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Seattle
 
—

 
495,038

 
—

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
Total
 
3,067,657

 
2,644,792

 
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
 
54%
 
Office
 
2.6

million
 
46%
Data is as of December 31, 2013.
 
Totals
 
5.7

million
 
 
(1) Includes 122 RV spaces.
 
 
 
 
 
 
 

Fourth Quarter 2013 Supplemental Information
                               Page 2

 
 
INDEX
 
 

 
FOURTH QUARTER 2013 SUPPLEMENTAL INFORMATION
 
1.
FINANCIAL HIGHLIGHTS
 
 
Consolidated Balance Sheets
 
Consolidated Statements of Income
 
Funds From Operations (FFO), FFO As Adjusted & Funds Available for Distribution
 
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.

Fourth Quarter 2013 Supplemental Information
                               Page 3

 
 
 
 
 






FINANCIAL HIGHLIGHTS





Fourth Quarter 2013 Supplemental Information
                               Page 4

 
 
CONSOLIDATED BALANCE SHEETS
 
 

(Amounts in thousands, except shares and per share data)
December 31, 2013
 
December 31, 2012
 
 
 
 
ASSETS
 
 
 
Real estate, at cost
 
 
 
Operating real estate
$
1,919,015

 
$
1,891,549

Construction in progress
67,389

 
32,183

Held for development
9,013

 
14,944

 
1,995,417

 
1,938,676

Accumulated depreciation
(318,581
)
 
(270,494
)
Net real estate
1,676,836

 
1,668,182

Cash and cash equivalents
48,987

 
42,479

Restricted cash
9,124

 
7,421

Accounts receivable, net
7,295

 
6,440

Deferred rent receivable, net
32,531

 
29,395

Other assets, net
57,670

 
73,670

TOTAL ASSETS
$
1,832,443

 
$
1,827,587

LIABILITIES AND EQUITY
 
 
 
LIABILITIES:
 
 
 
Secured notes payable
$
952,174

 
$
1,044,682

Line of credit
93,000

 
—

Accounts payable and accrued expenses
37,063

 
29,509

Security deposits payable
5,163

 
4,856

Other liabilities and deferred credits
58,465

 
62,811

Total liabilities
1,145,865

 
1,141,858

Commitments and contingencies
 
 
 
EQUITY:
 
 
 
American Assets Trust, Inc. stockholders' equity
 
 
 
Common stock, $0.01 par value, 490,000,000 shares authorized, 40,512,563 and 39,664,212 shares issued and outstanding at December 31, 2013 and 2012, respectively
405

 
397

Additional paid in capital
692,196

 
663,589

Accumulated dividends in excess of net income
(44,090
)
 
(25,625
)
Total American Assets Trust, Inc. stockholders' equity
648,511

 
638,361

Noncontrolling interests
38,067

 
47,368

Total equity
686,578

 
685,729

TOTAL LIABILITIES AND EQUITY
$
1,832,443

 
$
1,827,587


Fourth Quarter 2013 Supplemental Information
                               Page 5

 
 
CONSOLIDATED STATEMENTS OF INCOME
 
 

(Amounts in thousands, except shares and per share data)
Three Months Ended
 
Year Ended
 
December 31,
 
December 31,
 
2013
 
2012
 
2013
 
2012
REVENUE:
 
 
 
 
 
 
 
Rental income
$
61,425

 
$
60,191

 
$
242,757

 
$
225,249

Other property income
3,220

 
2,929

 
12,300

 
10,217

Total revenue
64,645

 
63,120

 
255,057

 
235,466

EXPENSES:
 
 
 
 
 
 
 
Rental expenses
18,206

 
17,287

 
68,608

 
64,089

Real estate taxes
5,334

 
4,947

 
21,378

 
22,025

General and administrative
4,537

 
4,063

 
17,195

 
15,593

Depreciation and amortization
16,161

 
16,576

 
66,775

 
61,853

Total operating expenses
44,238

 
42,873

 
173,956

 
163,560

OPERATING INCOME
20,407

 
20,247

 
81,101

 
71,906

Interest expense
(13,776
)
 
(15,152
)
 
(58,020
)
 
(57,328
)
Other income (expense), net
276

 
(273
)
 
(487
)
 
(629
)
INCOME FROM CONTINUING OPERATIONS
6,907

 
4,822

 
22,594

 
13,949

DISCONTINUED OPERATIONS
 
 
 
 
 
 
 
Income from discontinued operations
—

 
279

 
—

 
932

Gain on sale of real estate property
—

 
36,720

 
—

 
36,720

Results from discontinued operations
—

 
36,999

 
—

 
37,652

NET INCOME
6,907

 
41,821

 
22,594

 
51,601

Net income attributable to restricted shares
(139
)
 
(133
)
 
(536
)
 
(529
)
Net income attributable to unitholders in the Operating Partnership
(2,086
)
 
(13,111
)
 
(6,838
)
 
(16,133
)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, INC. STOCKHOLDERS
$
4,682

 
$
28,577

 
$
15,220

 
$
34,939

Basic income from continuing operations attributable to common stockholders per share
$
0.11

 
$
0.08

 
$
0.38

 
$
0.24

Basic income from discontinued operations attributable to common stockholders per share
—

 
0.65

 
—

 
0.66

Basic income attributable to common stockholders per share
$
0.11

 
$
0.73

 
$
0.38

 
$
0.90

Weighted average shares of common stock outstanding - basic
39,836,104

 
38,952,816

 
39,539,457

 
38,736,113

Diluted income from continuing operations attributable to common stockholders per share
$
0.11

 
$
0.08

 
$
0.38

 
$
0.24

Diluted income from discontinued operations attributable to common stockholders per share
—

 
0.65

 
—

 
0.66

Diluted income attributable to common stockholders per share
$
0.11

 
$
0.73

 
$
0.38

 
$
0.90

Weighted average shares of common stock outstanding - diluted
57,788,365

 
57,054,425

 
57,515,810

 
57,053,909


Fourth Quarter 2013 Supplemental Information
                               Page 6

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

(Amounts in thousands, except per share data)
Three Months Ended
 
Year Ended
 
December 31,
 
December 31,
 
2013
 
2012
 
2013
 
2012
Funds from Operations (FFO) (1)
 
 
 
 
 
 
 
Net income
$
6,907

 
$
41,821

 
$
22,594

 
$
51,601

Depreciation and amortization of real estate assets (2)
16,161

 
16,656

 
66,775

 
63,011

Gain on sale of real estate
—

 
(36,720
)
 
—

 
(36,720
)
FFO, as defined by NAREIT
23,068

 
21,757

 
89,369

 
77,892

Less: Nonforfeitable dividends on incentive stock awards
(92
)
 
(88
)
 
(357
)
 
(354
)
FFO attributable to common stock and common units
$
22,976

 
$
21,669

 
$
89,012

 
$
77,538

FFO per diluted share/unit
$
0.40

 
$
0.38

 
$
1.54

 
$
1.35

Weighted average number of common shares and common units, diluted (3)
57,998,249

 
57,266,950

 
57,726,012

 
57,262,767

 
 
 
 
 
 
 
 
Funds Available for Distribution (FAD) (1)
$
16,254

 
$
12,725

 
$
69,993

 
$
45,674

 
 
 
 
 
 
 
 
Dividends
 
 
 
 
 
 
 
Dividends declared and paid
$
12,855

 
$
12,114

 
$
49,500

 
$
48,452

Dividends declared and paid per share/unit
$
0.22

 
$
0.21

 
$
0.85

 
$
0.84


Fourth Quarter 2013 Supplemental Information
                               Page 7

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

(Amounts in thousands, except share and per share data)
Three Months Ended
 
Year Ended
 
December 31,
 
December 31,
 
2013
 
2012
 
2013
 
2012
Funds Available for Distribution (FAD) (1)
 
 
 
 
 
 
 
FFO
$
23,068

 
$
21,757

 
$
89,369

 
$
77,892

Adjustments (includes discontinued operations for 160 King Street):
 
 
 
 
 
 
 
Tenant improvements, leasing commissions and maintenance capital expenditures
(6,810
)
 
(8,040
)
 
(20,356
)
 
(30,898
)
Net effect of straight-line rents (4)
(1,030
)
 
(2,125
)
 
(3,244
)
 
(7,580
)
Amortization of net above (below) market rents (5)
(630
)
 
(254
)
 
(2,388
)
 
237

Net effect of other lease intangibles (6)
39

 
71

 
192

 
268

Amortization of debt issuance costs and debt fair value adjustment
983

 
983

 
3,932

 
3,911

Non-cash compensation expense
726

 
724

 
2,845

 
2,852

Unrealized (gains) losses on marketable securities
—

 
—

 
—

 
538

Loss on sale of marketable securities
—

 
—

 
—

 
121

Nonforfeitable dividends on incentive stock awards
(92
)
 
(88
)
 
(357
)
 
(354
)
Adjustments related to discontinued operations
—

 
(303
)
 
—

 
(1,313
)
FAD
$
16,254

 
$
12,725

 
$
69,993

 
$
45,674

 
 
 
 
 
 
 
 
Summary of Capital Expenditures
 
 
 
 
 
 
 
Tenant improvements and leasing commissions
$
2,966

 
$
5,804

 
$
11,584

 
$
24,032

Maintenance capital expenditures
3,844

 
2,236

 
8,772

 
6,866

 
$
6,810

 
$
8,040

 
$
20,356

 
$
30,898


Notes:
(1)
See Glossary of Terms.
(2)
The three months and year ended December 31, 2012 includes depreciation and amortization on 160 King Street, which was sold on December 4, 2012. 160 King Street is classified as a discontinued operation.
(3)
For the three months and year ended December 31, 2013 and 2012, the weighted average common shares and common units used to compute FFO and FFO As Adjusted 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 and FFO As Adjusted 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.
(4)
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.
(5)
Represents the adjustment related to the acquisition of buildings with above (below) market rents.
(6)
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.


Fourth Quarter 2013 Supplemental Information
                               Page 8

 
 
SAME-STORE PORTFOLIO NET OPERATING INCOME (NOI)
 
 

(Amounts in thousands)
Three Months Ended December 31, 2013
 
Retail
 
Office
 
Multifamily
 
Mixed-Use
 
Total
Real estate rental revenue
 
 
 
 
 
 
 
 
 
Same-store portfolio
$
23,784

 
$
15,837

 
$
4,121

 
$
13,321

 
$
57,063

Non-same store portfolio (1)
490

 
7,092

 
—

 
—

 
7,582

Total
24,274

 
22,929

 
4,121

 
13,321

 
64,645

Real estate expenses
 
 
 
 
 
 
 
 
 
Same-store portfolio
6,249

 
4,657

 
1,534

 
8,550

 
20,990

Non-same store portfolio (1)
175

 
2,375

 
—

 
—

 
2,550

Total
6,424

 
7,032

 
1,534

 
8,550

 
23,540

Net Operating Income (NOI), GAAP basis
 
 
 
 
 
 
 
 
 
Same-store portfolio
17,535

 
11,180

 
2,587

 
4,771

 
36,073

Non-same store portfolio (1)
315

 
4,717

 
—

 
—

 
5,032

Total
$
17,850

 
$
15,897

 
$
2,587

 
$
4,771

 
$
41,105

Same-store portfolio NOI, GAAP basis
$
17,535

 
$
11,180

 
$
2,587

 
$
4,771

 
$
36,073

Net effect of straight-line rents (2)
(9
)
 
(585
)
 
—

 
(53
)
 
(647
)
Amortization of net above (below) market rents (3)
(225
)
 
(598
)
 
—

 
139

 
(684
)
Net effect of other lease intangibles (4)
—

 
(30
)
 
—

 
(20
)
 
(50
)
Same-store portfolio NOI, cash basis
$
17,301

 
$
9,967

 
$
2,587

 
$
4,837

 
$
34,692


Notes:
(1)
Same-store portfolio and non-same store portfolio are determined based on properties held on December 31, 2013 and 2012. 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.

Fourth Quarter 2013 Supplemental Information
                               Page 9

 
 
SAME-STORE PORTFOLIO NET OPERATING INCOME (NOI)
 
 

(Amounts in thousands)
Year Ended December 31, 2013
 
Retail
 
Office
 
Multifamily
 
Mixed-Use
 
Total
Real estate rental revenue
 
 
 
 
 
 
 
 
 
Same-store portfolio
$
91,546

 
$
39,993

 
$
16,125

 
$
54,956

 
$
202,620

Non-same store portfolio (1)
1,903

 
50,534

 
—

 
—

 
52,437

Total
93,449

 
90,527

 
16,125

 
54,956

 
255,057

Real estate expenses
 
 
 
 
 
 
 
 
 
Same-store portfolio
23,235

 
12,177

 
5,917

 
33,481

 
74,810

Non-same store portfolio (1)
665

 
14,511

 
—

 
—

 
15,176

Total
23,900

 
26,688

 
5,917

 
33,481

 
89,986

Net Operating Income (NOI), GAAP basis
 
 
 
 
 
 
 
 
 
Same-store portfolio
68,311

 
27,816

 
10,208

 
21,475

 
127,810

Non-same store portfolio (1)
1,238

 
36,023

 
—

 
—

 
37,261

Total
$
69,549

 
$
63,839

 
$
10,208

 
$
21,475

 
$
165,071

Same-store portfolio NOI, GAAP basis
$
68,311

 
$
27,816

 
$
10,208

 
$
21,475

 
$
127,810

Net effect of straight-line rents (2)
529

 
(1,470
)
 
—

 
(225
)
 
(1,166
)
Amortization of net above (below) market rents (3)
(791
)
 
(816
)
 
—

 
737

 
(870
)
Net effect of other lease intangibles (4)
—

 
(100
)
 
—

 
(79
)
 
(179
)
Same-store portfolio NOI, cash basis
$
68,049

 
$
25,430

 
$
10,208

 
$
21,908

 
$
125,595


Notes:
(1)
Same-store portfolio and non-same store portfolio are determined based on properties held on December 31, 2013 and 2012. 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.



Fourth Quarter 2013 Supplemental Information
                               Page 10

 
 
SAME-STORE PORTFOLIO NOI COMPARISON EXCLUDING REDEVELOPMENT
 
 

(Amounts in thousands)
Three Months Ended
 
 
 
Year Ended
 
 
 
December 31,
 
 
 
December 31,
 
 
 
2013
 
2012
 
Change
 
2013
 
2012
 
Change
Cash Basis:
 
 
 
 
 
 
 
 
 
 
 
Retail
$
17,301

 
$
17,676

 
(2.1
)%
 
$
68,049

 
$
65,270

 
4.3
%
Office
9,967

 
8,867

 
12.4

 
25,430

 
24,250

 
4.9

Multifamily
2,587

 
2,418

 
7.0

 
10,208

 
8,938

 
14.2

Mixed-Use
4,837

 
4,491

 
7.7

 
21,908

 
19,572

 
11.9

 
$
34,692

 
$
33,452

 
3.7
 %
 
$
125,595

 
$
118,030

 
6.4
%
 
 
 
 
 
 
 
 
 
 
 
 
GAAP Basis:
 
 
 
 
 
 
 
 
 
 
 
Retail
$
17,535

 
$
17,827

 
(1.6
)%
 
$
68,311

 
$
67,063

 
1.9
%
Office
11,180

 
11,286

 
(0.9
)
 
27,816

 
27,489

 
1.2

Multifamily
2,587

 
2,418

 
7.0

 
10,208

 
8,938

 
14.2

Mixed-Use
4,771

 
4,371

 
9.2

 
21,475

 
19,057

 
12.7

 
$
36,073

 
$
35,902

 
0.5
 %
 
$
127,810

 
$
122,547

 
4.3
%


Fourth Quarter 2013 Supplemental Information
                               Page 11

 
 
SAME-STORE PORTFOLIO NOI COMPARISON WITH REDEVELOPMENT
 
 

(Amounts in thousands)
Three Months Ended
 
 
 
Year Ended
 
 
 
December 31,
 
 
 
December 31,
 
 
 
2013
 
2012
 
Change
 
2013
 
2012
 
Change
Cash Basis:
 
 
 
 
 
 
 
 
 
 
 
Retail
$
17,301

 
$
17,676

 
(2.1
)%
 
$
68,049

 
$
65,270

 
4.3
 %
Office
14,500

 
13,925

 
4.1

 
43,824

 
43,622

 
0.5

Multifamily
2,587

 
2,418

 
7.0

 
10,208

 
8,938

 
14.2

Mixed-Use
4,837

 
4,491

 
7.7

 
21,908

 
19,572

 
11.9

 
$
39,225

 
$
38,510

 
1.9
 %
 
$
143,989

 
$
137,402

 
4.8
 %
 
 
 
 
 
 
 
 
 
 
 
 
GAAP Basis:
 
 
 
 
 
 
 
 
 
 
 
Retail
$
17,535

 
$
17,827

 
(1.6
)%
 
$
68,311

 
$
67,063

 
1.9
 %
Office
15,926

 
16,200

 
(1.7
)
 
45,590

 
45,849

 
(0.6
)
Multifamily
2,587

 
2,418

 
7.0

 
10,208

 
8,938

 
14.2

Mixed-Use
4,771

 
4,371

 
9.2

 
21,475

 
19,057

 
12.7

 
$
40,819

 
$
40,816

 
—
 %
 
$
145,584

 
$
140,907

 
3.3
 %

Fourth Quarter 2013 Supplemental Information
                               Page 12

 
 
NOI BY REGION
 
 

(Amounts in thousands)
Three Months Ended December 31, 2013
 
Retail
 
Office
 
Multifamily
 
Mixed-Use
 
Total
Southern California
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
$
7,157

 
$
4,167

 
$
2,587

 
$
—

 
$
13,911

Net effect of straight-line rents (2)
(165
)
 
(371
)
 
—

 
—

 
(536
)
Amortization of net above (below) market rents (3)
(280
)
 
18

 
—

 
—

 
(262
)
Net effect of other lease intangibles (4)
—

 
89

 
—

 
—

 
89

NOI, cash basis
6,712

 
3,903

 
2,587

 
—

 
13,202

Northern California
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
2,839

 
4,118

 
—

 
—

 
6,957

Net effect of straight-line rents (2)
8

 
(471
)
 
—

 
—

 
(463
)
Amortization of net above (below) market rents (3)
(78
)
 
(194
)
 
—

 
—

 
(272
)
Net effect of other lease intangibles (4)
—

 
(30
)
 
—

 
—

 
(30
)
NOI, cash basis
2,769

 
3,423

 
—

 
—

 
6,192

Hawaii
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
4,715

 
—

 
—

 
4,771

 
9,486

Net effect of straight-line rents (2)
91

 
—

 
—

 
(53
)
 
38

Amortization of net above (below) market rents (3)
181

 
—

 
—

 
140

 
321

Net effect of other lease intangibles (4)
—

 
—

 
—

 
(20
)
 
(20
)
NOI, cash basis
4,987

 
—

 
—

 
4,838

 
9,825

Oregon
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
—

 
3,950

 
—

 
—

 
3,950

Net effect of straight-line rents (2)
—

 
1

 
—

 
—

 
1

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

 
(10
)
 
—

 
—

 
(10
)
NOI, cash basis
—

 
3,941

 
—

 
—

 
3,941

Texas
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
3,139

 
—

 
—

 
—

 
3,139

Net effect of straight-line rents (2)
41

 
—

 
—

 
—

 
41

Amortization of net above (below) market rents (3)
(59
)
 
—

 
—

 
—

 
(59
)
NOI, cash basis
3,121

 
—

 
—

 
—

 
3,121

Washington
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
—

 
3,662

 
—

 
—

 
3,662

Net effect of straight-line rents (2)
—

 
(111
)
 
—

 
—

 
(111
)
Amortization of net above (below) market rents (3)
—

 
(348
)
 
—

 
—

 
(348
)
NOI, cash basis
—

 
3,203

 
—

 
—

 
3,203

Total
 
 
 
 
 
 
 
 
 
NOI, GAAP basis (1)
17,850

 
15,897

 
2,587

 
4,771

 
41,105

Net effect of straight-line rents (2)
(25
)
 
(952
)
 
—

 
(53
)
 
(1,030
)
Amortization of net above (below) market rents (3)
(236
)
 
(534
)
 
—

 
140

 
(630
)
Net effect of other lease intangibles (4)
—

 
59

 
—

 
(20
)
 
39

NOI, cash basis
$
17,589

 
$
14,470

 
$
2,587

 
$
4,838

 
$
39,484

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.

Fourth Quarter 2013 Supplemental Information
                               Page 13

 
 
NOI BREAKDOWN
 
 


Three Months Ended December 31, 2013
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
 
 
 
 

Fourth Quarter 2013 Supplemental Information
                               Page 14

 
 
PROPERTY REVENUE AND OPERATING EXPENSES
 
 

(Amounts in thousands)
 
Three Months Ended December 31, 2013
 
 
 
 
Additional
 
 
 
Property
 
 
 
 
Property
 
Billed Expense
 
Operating
Property
 
Base Rent (1)
 
Income (2)
 
Reimbursements (3)
 
Expenses (4)
Retail Portfolio
 
 
 
 
 
 
 
 
Carmel Country Plaza
 
$
837

 
$
20

 
$
196

 
$
(164
)
Carmel Mountain Plaza
 
2,604

 
47

 
783

 
(880
)
South Bay Marketplace
 
555

 
11

 
209

 
(170
)
Rancho Carmel Plaza
 
165

 
9

 
49

 
(72
)
Lomas Santa Fe Plaza
 
1,166

 
30

 
322

 
(397
)
Solana Beach Towne Centre
 
1,381

 
29

 
489

 
(491
)
Del Monte Center
 
2,156

 
529

 
1,036

 
(1,230
)
Geary Marketplace
 
292

 
—

 
134

 
(148
)
The Shops at Kalakaua
 
396

 
20

 
40

 
(69
)
Waikele Center
 
4,457

 
485

 
1,090

 
(1,432
)
Alamo Quarry Market
 
3,211

 
257

 
1,086

 
(1,433
)
Subtotal Retail Portfolio
 
$
17,220

 
$
1,437

 
$
5,434

 
$
(6,486
)
Office Portfolio
 
 
 
 
 
 
 
 
Torrey Reserve Campus (5)
 
$
3,845

 
$
207

 
$
247

 
$
(1,120
)
Solana Beach Corporate Centre
 
1,553

 
56

 
78

 
(467
)
The Landmark at One Market
 
4,748

 
25

 
105

 
(1,930
)
One Beach Street
 
650

 
1

 
60

 
(207
)
First & Main
 
2,514

 
120

 
256

 
(769
)
Lloyd District Portfolio (5)
 
2,712

 
358

 
165

 
(1,325
)
City Center Bellevue
 
3,714

 
691

 
248

 
(1,315
)
Subtotal Office Portfolio
 
$
19,736

 
$
1,458

 
$
1,159

 
$
(7,133
)
Multifamily Portfolio
 
 
 
 
 
 
 
 
Loma Palisades
 
$
2,608

 
$
193

 
$
—

 
$
(1,044
)
Imperial Beach Gardens
 
681

 
57

 
—

 
(273
)
Mariner's Point
 
313

 
32

 
—

 
(57
)
Santa Fe Park RV Resort
 
220

 
19

 
—

 
(159
)
Subtotal Multifamily Portfolio
 
$
3,822

 
$
301

 
$
—

 
$
(1,533
)

Fourth Quarter 2013 Supplemental Information
                               Page 15

 
 
PROPERTY REVENUE AND OPERATING EXPENSES (CONTINUED)
 
 

(Unaudited, amounts in thousands)
 
Three Months Ended December 31, 2013
 
 
 
 
Additional
 
 
 
Property
 
 
 
 
Property
 
Billed Expense
 
Operating
Property
 
Base Rent (1)
 
Income (2)
 
Reimbursements (3)
 
Expenses (4)
Mixed-Use Portfolio
 
 
 
 
 
 
 
 
Waikiki Beach Walk - Retail
 
$
2,513

 
$
1,169

 
$
983

 
$
(1,757
)
Waikiki Beach Walk - Embassy Suites™
 
8,127

 
614

 
—

 
(6,811
)
Subtotal Mixed-Use Portfolio
 
$
10,640

 
$
1,783

 
$
983

 
$
(8,568
)
Total
 
$
51,418

 
$
4,979

 
$
7,576

 
$
(23,720
)

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 December 31, 2013 (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 $28 and $720, respectively, for the three months ended December 31, 2013. There were no abatements for the retail portion of our mixed-use portfolio for the three months ended December 31, 2013. 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). Total abatements for our multifamily portfolio were approximately $3 for the three months ended December 31, 2013. For Waikiki Beach Walk - Embassy Suites TM, base rent is equal to the actual room revenue for the three months ended December 31, 2013.
(2)
Represents additional property-related income for the three months ended December 31, 2013, 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 December 31, 2013.
(4)
Represents property operating expenses for the three months ended December 31, 2013. 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 was $186 and abatements were $186 for the three months ended December 31, 2013.



Fourth Quarter 2013 Supplemental Information
                               Page 16

 
 
SEGMENT CAPITAL EXPENDITURES
 
 

(Amounts in thousands)
 
Three Months Ended December 31, 2013
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
 
$
546

 
$
1,139

 
$
1,685

 
$
7

 
$
14

 
$
1,706

Office Portfolio
 
2,410

 
1,332

 
3,742

 
2,379

 
480

 
6,601

Multifamily Portfolio
 
—

 
87

 
87

 
—

 
13,537

 
13,624

Mixed-Use Portfolio
 
10

 
1,286

 
1,296

 
—

 
—

 
1,296

Total
 
$
2,966

 
$
3,844

 
$
6,810

 
$
2,386

 
$
14,031

 
$
23,227

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Year Ended December 31, 2013
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
 
$
2,987

 
$
1,717

 
$
4,704

 
$
18

 
$
127

 
$
4,849

Office Portfolio
 
8,488

 
4,435

 
12,923

 
13,698

 
654

 
27,275

Multifamily Portfolio
 
—

 
787

 
787

 
—

 
23,854

 
24,641

Mixed-Use Portfolio
 
109

 
1,833

 
1,942

 
—

 
—

 
1,942

Total
 
$
11,584

 
$
8,772

 
$
20,356

 
$
13,716

 
$
24,635

 
$
58,707

 
 
 
 
 
 
 
 
 
 
 
 
 



Fourth Quarter 2013 Supplemental Information
                               Page 17

 
 
SUMMARY OF OUTSTANDING DEBT
 
 

(Amounts in thousands)
 
Amount
 
 
 
 
 
 
 
 
 
 
Outstanding at
 
 
 
Annual Debt
 
 
 
Balance at
Debt
 
December 31, 2013
 
Interest Rate
 
Service
 
Maturity Date
 
Maturity
Waikele Center (1)
 
$
140,700

 
5.15
%
 
$
147,437

 
November 1, 2014
 
$
140,700

The Shops at Kalakaua (1)
 
19,000

 
5.45
%
 
1,053

 
May 1, 2015
 
19,000

The Landmark at One Market (1)(2)
 
133,000

 
5.61
%
 
7,558

 
July 5, 2015
 
133,000

Del Monte Center (1)
 
82,300

 
4.93
%
 
4,121

 
July 8, 2015
 
82,300

First & Main (1)
 
84,500

 
3.97
%
 
3,397

 
July 1, 2016
 
84,500

Imperial Beach Gardens (1)
 
20,000

 
6.16
%
 
1,250

 
September 1, 2016
 
20,000

Mariner's Point (1)
 
7,700

 
6.09
%
 
476

 
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
%
 
7,020

 
July 1, 2017
 
130,310

Solana Beach Corporate Centre III-IV
 
36,804

 
6.39
%
 
2,798

 
August 1, 2017
 
35,136

Loma Palisades (1)
 
73,744

 
6.09
%
 
4,553

 
July 1, 2018
 
73,744

One Beach Street (1)
 
21,900

 
3.94
%
 
875

 
April 1, 2019
 
21,900

Torrey Reserve - North Court (3)
 
21,377

 
7.22
%
 
1,836

 
June 1, 2019
 
19,443

Torrey Reserve - VCI, VCII, VCIII (3)
 
7,200

 
6.36
%
 
560

 
June 1, 2020
 
6,439

Solana Beach Corporate Centre I-II (3)
 
11,475

 
5.91
%
 
855

 
June 1, 2020
 
10,169

Solana Beach Towne Centre (3)
 
38,249

 
5.91
%
 
2,849

 
June 1, 2020
 
33,898

City Center Bellevue (1)
 
111,000

 
3.98
%
 
4,479

 
November 1, 2022
 
111,000

Total / Weighted Average
 
$
962,259

 
5.22
%
 
$
192,398

 
 
 
$
952,239

Unamortized fair value adjustment
 
(10,085
)
 
 
 
 
 
 
 
 
Secured Notes Payable
 
$
952,174

 
 
 
 
 
 
 
 
Fixed Rate Debt Ratio of Secured Notes Payable
 
 
 
 
 
 
 
 
 
 
Fixed rate debt
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Line of Credit (4)
 
$
93,000

 
 
 
 
 
 
 
 
Notes:
(1)
Interest only.
(2)
Maturity date is the earlier of the loan maturity date under the loan agreement, or the "Anticipated Repayment Date" as specifically defined in the loan agreement, which is the date after which substantial economic penalties apply if the loan has not been paid off.
(3)
Principal payments based on a 30-year amortization schedule.
(4)
The line of credit, which has a capacity of $250 million, matures in January 2016 and we have an option to extend its maturity to 2017. The availability on the revolving line of credit was approximately $222.3 million at December 31, 2013, of which $93 million is outstanding at December 31, 2013. At December 31, 2013, the interest rate on our outstanding credit facility was 1.8%.

Fourth Quarter 2013 Supplemental Information
                               Page 18

 
 
MARKET CAPITALIZATION
 
 

(Amounts in thousands, except per share data)
 
 
 
 
 
 
 
 
 
Market data
 
December 31, 2013
 
 
Common shares outstanding
 
40,513

 
 
Common units outstanding
 
17,917

 
 
Common shares and common units outstanding
 
58,430


Market price per common share
 
$
31.43

 
Equity market capitalization
 
$
1,836,455


Total debt
 
$
1,055,259

 
Total market capitalization
 
$
2,891,714


Less: Cash on hand
 
$
(48,987
)
 
Total enterprise value
 
$
2,842,727


Total assets, gross
 
$
2,151,024

 
 
 
 
 
Total debt/Total capitalization
 
36.5
%

Total debt/Total enterprise value
 
37.1
%

Net debt/Total enterprise value (1)
 
35.4
%

Total debt/Total assets, gross
 
49.1
%

Net debt/Total assets, gross (1)
 
46.8
%
 
 
 
 
 
Total debt/EBITDA (2)(3)
 
7.2
x
 
Net debt/EBITDA (1)(2)(3)
 
6.9
x
 
Interest coverage ratio (4)
 
2.7
x
 
Fixed charge coverage ratio (4)
 
2.7
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 December 31, 2013 annualized.
(4)
Calculated as EBITDA divided by interest on borrowed funds, including capitalized interest and excluding debt fair value adjustments and loan fee amortization.

Fourth Quarter 2013 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
Year
Cost Incurred to Date
Total Estimated Investment
Estimated Stabilized Yield (3)
 
 
Ended
Ended
Property
Location
December 31, 2013
December 31, 2013
Office Property:
 
 
 
 
 
 
 
 
 
 
 
Torrey Reserve III & IV
San Diego, CA
2012
2014
2015
81,500
N/A
$2,026
$13,388
$19,801
$34,100
8.60%
 
 
 
 
 
 
 
 
 
 
 
 
Mixed Use Property:
 
 
 
 
 
 
 
 
 
 
 
Lloyd District Portfolio
Portland, OR
2013
2015
2017
47,000
657
$16,952
$27,752
$30,920
$191,828
6.25% - 7.25%
 
 
 
 
 
 
 
 
 
 
 
 
Development/Redevelopment Pipeline
 
Property
Property Type
Location
Estimated Square Footage
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
 
Sorrento Pointe (5)
Office
San Diego, CA
88,000
N/A
 
Solana Beach - Highway 101 (4)
Mixed Use
Solana Beach, CA
48,000
36
 

Notes:
(1)
Based on management's estimation of stabilized occupancy (90%).
(2)
Project costs exclude allocated land costs and interest costs capitalized in accordance with Accounting Standards Codification ("ASC") 835-20-50-1.
(3)
Calculated as return on invested capital when project has reached stabilized occupancy, and excludes allocated land costs and interest cost capitalized in accordance with ASC 838-20-50-1.
(4)
Represents commercial portion of development opportunity for Solana Beach - Highway 101.
(5)
Development plans began during the second quarter of 2013.


Fourth Quarter 2013 Supplemental Information
                               Page 20

 
 
 
 
 






PORTFOLIO DATA





Fourth Quarter 2013 Supplemental Information
                               Page 21

 
 
PROPERTY REPORT
 
 

As of December 31, 2013
 
 
 
 
 
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%
 
$
3,349,500

 
$44.58
 
 
 
Sharp Healthcare, San Diego County Credit Union
Carmel Mountain Plaza (7)
 
San Diego, CA
 
1994
 
13

 
520,228

 
99.5
 
10,493,136

 
20.27
 
Sears
 
Sports Authority, Saks Fifth Avenue Off 5th
South Bay Marketplace (7)
 
San Diego, CA
 
1997
 
9

 
132,877

 
100.0
 
2,220,869

 
16.71
 
 
 
Ross Dress for Less, Grocery Outlet
Rancho Carmel Plaza
 
San Diego, CA
 
1993
 
3

 
30,421

 
73.9
 
678,318

 
30.17
 
 
 
Oggi's Pizza & Brewing Co., Saloncentric
Lomas Santa Fe Plaza
 
Solana Beach, CA
 
1972/1997
 
9

 
209,569

 
82.4
 
4,666,029

 
27.02
 
 
 
Vons, We-R-Fabrics
Solana Beach Towne Centre
 
Solana Beach, CA
 
1973/2000/2004
 
12

 
246,730

 
98.7
 
5,566,794

 
22.86
 
 
 
Dixieline Probuild, Marshalls
Del Monte Center (7)
 
Monterey, CA
 
1967/1984/2006
 
16

 
675,678

 
99.7
 
9,240,799

 
13.72
 
Macy's, KLA Monterrey
 
Century Theatres, Macy's Furniture Gallery
Geary Marketplace
 
Walnut Creek, CA
 
2012
 
3

 
35,156

 
100.0
 
1,167,310

 
33.20
 
 
 
Sprouts Farmer Market, Freebirds Wild Burrito
The Shops at Kalakaua
 
Honolulu, HI
 
1971/2006
 
3

 
11,671

 
100.0
 
1,585,276

 
135.83
 
 
 
Hawaii Beachware & Fashion, Diesel U.S.A. Inc.
Waikele Center
 
Waipahu, HI
 
1993/2008
 
9

 
537,728

 
98.8
 
17,813,655

 
33.53
 
Lowe's, Kmart, Sports Authority, Foodland Super Market
 
UFC Gym, Old Navy
Alamo Quarry Market (7)
 
San Antonio, TX
 
1997/1999
 
16

 
589,501

 
94.8
 
12,999,725

 
23.26
 
Regal Cinemas
 
Bed Bath & Beyond, Whole Foods Market
Subtotal/Weighted Average Retail Portfolio
 
 
 
102

 
3,067,657

 
97.0%
 
$
69,781,411

 
$23.45
 
 
 
 
Office Properties
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Torrey Reserve Campus
 
San Diego, CA
 
1996-2000
 
10

 
476,020

 
92.1%
 
$
15,434,441

 
$35.21
 
 
 
 
Solana Beach Corporate Centre
 
Solana Beach, CA
 
1982/2005
 
4

 
212,165

 
89.2
 
6,190,185

 
32.71
 
 
 
 
The Landmark at One Market (8)
 
San Francisco, CA
 
1917/2000
 
1

 
421,934

 
100.0
 
19,238,802

 
45.60
 
 
 
 
One Beach Street
 
San Francisco, CA
 
1924/1972/1987/1992
 
1

 
97,614

 
84.2
 
2,607,201

 
31.72
 
 
 
 
First & Main
 
Portland, OR
 
2010
 
1

 
360,813

 
82.4
 
9,058,170

 
30.47
 
 
 
 
Lloyd District Portfolio
 
Portland, OR
 
1940-2011
 
6

 
581,208

 
83.0
 
10,869,327

 
22.53
 
 
 
 
City Center Bellevue
 
Bellevue, WA
 
1987
 
1

 
495,038

 
93.6
 
14,969,964

 
32.31
 
 
 
 
Subtotal/Weighted Average Office Portfolio
 
 
 
24

 
2,644,792

 
89.8%
 
$
78,368,090

 
$33.00
 
 
 
 
Total/Weighted Average Retail and Office Portfolio
 
 
 
126

 
5,712,449

 
93.7%
 
$
148,149,501

 
$27.68
 
 
 
 

Fourth Quarter 2013 Supplemental Information
                               Page 22

 
 
PROPERTY REPORT (CONTINUED)
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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

 
98.4%
 
$
10,439,364

 
$
1,613

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

 
160

 
97.5
 
2,692,248

 
$
1,438

 
 
 
 
Mariner's Point
 
Imperial Beach, CA
 
1986
 
8

 
88

 
100.0
 
1,203,624

 
$
1,140

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

 
126

 
84.0
 
828,720

 
$
652

 
 
 
 
Total/Weighted Average Multifamily Portfolio
 
 
 
115

 
922

 
96.4%
 
$
15,163,956

 
$
1,422

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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

 
97.8
%
 
$
10,235,236

 
$
108.22

 
 
 
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
 
2

 
369

 
82.6
%
 
$
289.73

 
$
239.32

 
 
 
 
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 December 31, 2013, including leases which may not have commenced as of December 31, 2013. Percentage leased for our multifamily properties includes total units rented as of December 31, 2013.
(3)
Annualized base rent is calculated by multiplying base rental payments (defined as cash base rents (before abatements)) for the month ended December 31, 2013 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 December 31, 2013. Annualized base rent per leased unit is calculated by dividing annualized base rent by units under lease as of December 31, 2013.
(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
 
127,112

 
$
1,081,452

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 421,934 net rentable square feet consisting of The Landmark at One Market (377,714 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 2026 pursuant to two 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 December 31, 2013, the highest average monthly occupancy rate for this property was 99%, occurring in July 2013. 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 December 31, 2013, 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 December 31, 2013 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 December 31, 2013 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.

Fourth Quarter 2013 Supplemental Information
                               Page 23

 
 
RETAIL LEASING SUMMARY
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
14

 
100%
 
79,122

 
$36.61
 
$36.60
 
$
373

 
—
 %
 
6.4
 %
 
6.6
 
$
240,100

 
$3.03
3rd Quarter 2013
 
23

 
100%
 
53,709

 
$33.68
 
$34.08
 
$
(21,357
)
 
(1.2
)%
 
4.5
 %
 
3.7
 
$
333,800

 
$6.21
2nd Quarter 2013
 
11

 
100%
 
38,960

 
$30.60
 
$28.09
 
$
97,872

 
8.9
 %
 
17.6
 %
 
5.5
 
$
54,358

 
$1.40
1st Quarter 2013
 
11

 
100%
 
19,639

 
$38.83
 
$36.50
 
$
45,691

 
6.4
 %
 
9.8
 %
 
3.7
 
$
47,500

 
$2.42
Total 12 months
 
59

 
100%
 
191,430

 
$34.79
 
$34.15
 
$
122,579

 
1.9
 %
 
8.1
 %
 
5.3
 
$
675,758

 
$3.53
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
4

 
29%
 
12,377

 
$77.23
 
$58.46
 
$
232,378

 
32.1
 %
 
36.3
 %
 
8.0
 
$
240,100

 
$19.40
3rd Quarter 2013
 
3

 
13%
 
5,790

 
$38.49
 
$44.97
 
$
(37,565
)
 
(14.4
)%
 
(14.5
)%
 
3.2
 
$
313,800

 
$54.20
2nd Quarter 2013
 
2

 
18%
 
3,275

 
$31.75
 
$26.72
 
$
16,470

 
18.8
 %
 
20.1
 %
 
5.3
 
$
32,750

 
$10.00
1st Quarter 2013
 
2

 
18%
 
2,686

 
$36.84
 
$35.60
 
$
3,322

 
3.5
 %
 
(1.3
)%
 
2.9
 
$
15,000

 
$5.58
Total 12 months
 
11

 
19%
 
24,128

 
$57.26
 
$48.37
 
$
214,605

 
18.4
 %
 
21.2
 %
 
5.9
 
$
601,650

 
$24.94
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
10

 
71%
 
66,745

 
$29.07
 
$32.55
 
$
(232,005
)
 
(10.7
)%
 
(4.4
)%
 
6.3
 
$
—

 
$0.00
3rd Quarter 2013
 
20

 
87%
 
47,919

 
$33.10
 
$32.76
 
$
16,208

 
1.0
 %
 
7.7
 %
 
3.7
 
$
20,000

 
$0.42
2nd Quarter 2013
 
9

 
82%
 
35,685

 
$30.49
 
$28.21
 
$
81,402

 
8.1
 %
 
17.4
 %
 
5.5
 
$
21,608

 
$0.61
1st Quarter 2013
 
9

 
82%
 
16,953

 
$39.14
 
$36.64
 
$
42,369

 
6.8
 %
 
11.6
 %
 
3.9
 
$
32,500

 
$1.92
Total 12 months
 
48

 
81%
 
167,302

 
$31.55
 
$32.10
 
$
(92,026
)
 
(1.7
)%
 
5.1
 %
 
5.1
 
$
74,108

 
$0.44
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
21

 
128,422

 
$32.37
 
7.6
 
$
1,704,715

 
$13.27
 
 
 
 
 
 
 
 
 
 
3rd Quarter 2013
 
26

 
59,433

 
$34.49
 
4.1
 
$
448,940

 
$7.55
 
 
 
 
 
 
 
 
 
 
2nd Quarter 2013
 
16

 
73,385

 
$22.18
 
7.1
 
$
350,858

 
$4.78
 
 
 
 
 
 
 
 
 
 
1st Quarter 2013
 
14

 
23,944

 
$38.72
 
4.0
 
$
137,500

 
$5.74
 
 
 
 
 
 
 
 
 
 
Total 12 months
 
77

 
285,184

 
$30.72
 
6.4
 
$
2,642,013

 
$9.26
 
 
 
 
 
 
 
 
 
 
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.

Fourth Quarter 2013 Supplemental Information
                               Page 24

 
 
OFFICE LEASING SUMMARY
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
16

 
100%
 
163,157

 
$28.76
 
$28.89
 
$
(21,093
)
 
(0.4
)%
 
12.3
%
 
7.2
 
$
2,693,623

 
$16.51
3rd Quarter 2013
 
11

 
100%
 
52,805

 
$31.44
 
$31.32
 
$
5,875

 
0.4
 %
 
3.7
%
 
5.8
 
$
412,943

 
$7.82
2nd Quarter 2013
 
12

 
100%
 
59,028

 
$30.99
 
$32.23
 
$
(72,922
)
 
(3.8
)%
 
5.4
%
 
6.7
 
$
1,486,752

 
$25.19
1st Quarter 2013
 
14

 
100%
 
73,838

 
$34.90
 
$33.53
 
$
101,256

 
4.1
 %
 
16.7
%
 
4.7
 
$
885,649

 
$11.99
Total 12 months
 
53

 
100%
 
348,828

 
$30.84
 
$30.81
 
$
13,116

 
0.1
 %
 
10.8
%
 
6.4
 
$
5,478,967

 
$15.71
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
5

 
31%
 
68,796

 
$25.81
 
$27.57
 
$
(120,948
)
 
(6.4
)%
 
12.3
%
 
9.8
 
$
1,981,147

 
$28.80
3rd Quarter 2013
 
2

 
18%
 
14,930

 
$35.74
 
$32.28
 
$
51,693

 
10.7
 %
 
12.8
%
 
9.1
 
$
134,327

 
$9.00
2nd Quarter 2013
 
5

 
42%
 
38,462

 
$27.43
 
$29.83
 
$
(92,602
)
 
(8.1
)%
 
6.0
%
 
8.7
 
$
1,343,691

 
$34.94
1st Quarter 2013
 
6

 
43%
 
24,972

 
$33.74
 
$35.87
 
$
(53,113
)
 
(5.9
)%
 
11.8
%
 
7.3
 
$
257,069

 
$10.29
Total 12 months
 
18

 
34%
 
147,160

 
$28.59
 
$30.05
 
$
(214,970
)
 
(4.9
)%
 
10.6
%
 
9.0
 
$
3,716,234

 
$25.25
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
11

 
69%
 
94,361

 
$30.91
 
$29.85
 
$
99,855

 
3.5
 %
 
12.3
%
 
5.4
 
$
712,476

 
$7.55
3rd Quarter 2013
 
9

 
82%
 
37,875

 
$29.74
 
$30.95
 
$
(45,818
)
 
(3.9
)%
 
—
%
 
4.5
 
$
278,616

 
$7.36
2nd Quarter 2013
 
7

 
58%
 
20,566

 
$37.66
 
$36.70
 
$
19,680

 
2.6
 %
 
4.5
%
 
2.9
 
$
143,061

 
$6.96
1st Quarter 2013
 
8

 
57%
 
48,866

 
$35.49
 
$32.33
 
$
154,369

 
9.8
 %
 
19.6
%
 
3.4
 
$
628,580

 
$12.86
Total 12 months
 
35

 
66%
 
201,668

 
$32.49
 
$31.36
 
$
228,086

 
3.6
 %
 
10.9
%
 
4.5
 
$
1,762,733

 
$8.74
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4th Quarter 2013
 
23

 
198,307

 
$29.35
 
7.1
 
$
4,207,999

 
$21.22
 
 
 
 
 
 
 
 
 
 
3rd Quarter 2013
 
19

 
79,317

 
$32.87
 
4.7
 
$
910,994

 
$11.49
 
 
 
 
 
 
 
 
 
 
2nd Quarter 2013
 
17

 
70,070

 
$31.56
 
6.6
 
$
1,756,251

 
$25.06
 
 
 
 
 
 
 
 
 
 
1st Quarter 2013
 
18

 
111,596

 
$30.73
 
6.0
 
$
2,298,525

 
$20.60
 
 
 
 
 
 
 
 
 
 
Total 12 months
 
77

 
459,290

 
$30.63
 
6.3
 
$
9,173,769

 
$19.97
 
 
 
 
 
 
 
 
 
 
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.

Fourth Quarter 2013 Supplemental Information
                               Page 25

 
 
MULTIFAMILY LEASING SUMMARY
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
Lease Summary - Loma Palisades
 
 
 
 
 
 
Number of Leased Units
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Average Monthly Base Rent per Leased Unit (3)
Quarter
 
 
 
 
4th Quarter 2013
 
539
 
98.4%
 
$10,439,364
 
$1,613
3rd Quarter 2013
 
546
 
99.6%
 
$10,306,416
 
$1,574
2nd Quarter 2013
 
538
 
98.2%
 
$10,058,160
 
$1,558
1st Quarter 2013
 
526
 
96.0%
 
$9,772,104
 
$1,548
 
 
 
 
 
 
 
 
 
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
 
 
 
 
4th Quarter 2013
 
156
 
97.5%
 
$2,692,248
 
$1,438
3rd Quarter 2013
 
160
 
100.0%
 
$2,758,512
 
$1,437
2nd Quarter 2013
 
160
 
100.0%
 
$2,725,968
 
$1,420
1st Quarter 2013
 
156
 
97.5%
 
$2,637,432
 
$1,409
 
 
 
 
 
 
 
 
 
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
 
 
 
 
4th Quarter 2013
 
88
 
100.0%
 
$1,203,624
 
$1,140
3rd Quarter 2013
 
88
 
100.0%
 
$1,231,584
 
$1,166
2nd Quarter 2013
 
88
 
100.0%
 
$1,198,860
 
$1,135
1st Quarter 2013
 
86
 
97.7%
 
$1,168,932
 
$1,133
 
 
 
 
 
 
 
 
 
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
 
 
 
 
4th Quarter 2013
 
106
 
84.0%
 
$828,720
 
$652
3rd Quarter 2013
 
98
 
77.8%
 
$789,708
 
$671
2nd Quarter 2013
 
115
 
91.3%
 
$1,153,548
 
$836
1st Quarter 2013
 
101
 
80.0%
 
$858,144
 
$709
 
 
 
 
 
 
 
 
 
Total Multifamily Lease Summary
 
 
 
 
 
 
Number of Leased Units
 
Percentage leased (1)
 
Annualized Base Rent (2)
 
Average Monthly Base Rent per Leased Unit (3)
Quarter
 
 
 
 
4th Quarter 2013
 
889
 
96.4%
 
$15,163,956
 
$1,422
3rd Quarter 2013
 
892
 
96.7%
 
$15,086,220
 
$1,410
2nd Quarter 2013
 
901
 
97.7%
 
$15,136,536
 
$1,400
1st Quarter 2013
 
869
 
94.3%
 
$14,436,612
 
$1,384
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.

Fourth Quarter 2013 Supplemental Information
                               Page 26

 
 
MIXED-USE LEASING SUMMARY
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
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
 
 
 
 
4th Quarter 2013
 
94,623
 
97.8%
 
$10,235,236
 
$108
3rd Quarter 2013
 
94,692
 
97.9%
 
$10,130,130
 
$107
2nd Quarter 2013
 
90,664
 
93.8%
 
$9,898,572
 
$109
1st Quarter 2013
 
92,333
 
95.5%
 
$10,309,910
 
$112
 
 
 
 
 
 
 
 
 
Lease Summary - Hotel Portion
 
 
 
 
 
 
Number of Leased Units
 
Average Occupancy (4)
 
Average Daily Rate (4)
 
Annualized Revenue per Available Room (4)
Quarter
 
 
 
 
4th Quarter 2013
 
305
 
82.6%
 
$290
 
$239
3rd Quarter 2013
 
328
 
88.9%
 
$331
 
$294
2nd Quarter 2013
 
323
 
87.6%
 
$278
 
$244
1st Quarter 2013
 
331
 
89.6%
 
$297
 
$266
Notes:
(1)
Percentage leased for mixed-use property includes square footage under leases as of December 31, 2013, including leases which may not have commenced as of December 31, 2013.
(2)
Annualized base rent is calculated by multiplying base rental payments (defined as cash base rents (before abatements)) for the month ended December 31, 2013 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 December 31, 2013.
(4)
Average occupancy represents the percentage of available units that were sold during the three months ended December 31, 2013, 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.


Fourth Quarter 2013 Supplemental Information
                               Page 27

 
 
LEASE EXPIRATIONS
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
26,249

 
1.0
%
 
0.5
%
 
$5.51
 
30,985

 
1.0
%
 
0.5
%
 
$20.37
 
2,791

 
2.9
%
 
—
%
 
$23.38
 
60,025

 
1.0
%
 
$14.01
2014
 
242,445

 
9.2

 
4.2

 
$31.21
 
163,894

 
5.3

 
2.8

 
$47.11
 
4,382

 
4.5

 
0.1

 
$152.93
 
410,721

 
7.1

 
$38.85
2015
 
259,668

 
9.8

 
4.5

 
$34.07
 
246,881

 
8.0

 
4.2

 
$25.90
 
10,573

 
10.9

 
0.2

 
$230.82
 
517,122

 
8.9

 
$34.19
2016
 
272,803

 
10.3

 
4.7

 
$30.17
 
200,274

 
6.5

 
3.4

 
$34.59
 
14,172

 
14.7

 
0.2

 
$123.93
 
487,249

 
8.4

 
$34.71
2017
 
377,409

 
14.3

 
6.5

 
$34.98
 
333,248

 
10.9

 
5.7

 
$25.78
 
8,411

 
8.7

 
0.1

 
$149.69
 
719,068

 
12.4

 
$32.06
2018
 
198,853

 
7.5

 
3.4

 
$33.23
 
1,076,949

 
35.1

 
18.5

 
$19.41
 
10,767

 
11.1

 
0.2

 
$115.78
 
1,286,569

 
22.1

 
$22.35
2019
 
255,013


9.6

 
4.4

 
$36.77
 
287,739

 
9.4

 
5.0

 
$23.73
 
14,220

 
14.7

 
0.2

 
$77.92
 
556,972

 
9.6

 
$31.08
2020
 
270,340

 
10.2

 
4.7

 
$39.32
 
130,991

 
4.3

 
2.3

 
$10.89
 
17,843

 
18.5

 
0.3

 
$45.39
 
419,174

 
7.2

 
$30.69
2021
 
215,469

 
8.1

 
3.7

 
$36.08
 
39,949

 
1.3

 
0.7

 
$41.81
 
—

 
—

 
—

 
—
 
255,418

 
4.4

 
$36.98
2022
 
9,364

 
0.4

 
0.2

 
$20.00
 
148,868

 
4.9

 
2.6

 
$30.67
 
11,464

 
11.9

 
0.2

 
$76.71
 
169,696

 
2.9

 
$33.19
2023
 
96,281

 
3.6

 
1.7

 
$26.88
 
57,170

 
1.9

 
1.0

 
$24.51
 
—

 
—

 
—

 
—
 
153,451

 
2.6

 
$26.00
Thereafter
 
105,235

(2) 
4.0

 
1.8

 
$30.52
 
130,122

 
4.2

 
2.2

 
$20.93
 
—

 
—

 
—

 
—
 
235,357

 
4.1

 
$25.22
Signed Leases Not Commenced
 
45,615

 
1.7

 
0.8

 
—
 
128,185

 
4.2

 
2.2

 
—
 
—

 
—

 
—

 
—
 
173,800

 
3.0

 
—
Available
 
270,048

 
10.2

 
4.6

 
—
 
92,402

 
3.0

 
1.6

 
—
 
2,084

 
2.2

 
—

 
—
 
364,534

 
6.3

 
—
Total (3)
 
2,644,792

 
100.0
%
 
45.5
%
 
$29.63
 
3,067,657

 
100.0
%
 
52.8
%
 
$22.75
 
96,707

 
100.0
%
 
1.7
%
 
$105.84
 
5,809,156

 
100.0
%
 
$27.27
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
 
26,249

 
1.0
%
 
0.5
%
 
$5.51
 
30,985

 
1.0
%
 
0.5
%
 
$20.37
 
2,791

 
2.9
%
 
—
%
 
$23.38
 
60,025

 
1.0
%
 
$14.01
2014
 
219,798

 
8.3

 
3.8

 
$32.25
 
86,418

 
2.8

 
1.5

 
$65.55
 
3,952

 
4.1

 
0.1

 
$153.90
 
310,168

 
5.3

 
$43.08
2015
 
91,749

 
3.5

 
1.6

 
$33.25
 
57,485

 
1.9

 
1.0

 
$34.43
 
4,359

 
4.5

 
0.1

 
$196.35
 
153,593

 
2.6

 
$38.32
2016
 
194,747

 
7.4

 
3.4

 
$29.40
 
63,309

 
2.1

 
1.1

 
$30.36
 
10,574

 
10.9

 
0.2

 
$125.05
 
268,630

 
4.6

 
$33.39
2017
 
59,002

 
2.2

 
1.0

 
$36.24
 
88,875

 
2.9

 
1.5

 
$33.60
 
7,371

 
7.6

 
0.1

 
$144.67
 
155,248

 
2.7

 
$39.88
2018
 
91,402

 
3.5

 
1.6

 
$31.62
 
90,157

 
2.9

 
1.6

 
$29.29
 
10,767

 
11.1

 
0.2

 
$115.78
 
192,326

 
3.3

 
$35.24
2019
 
70,719

 
2.7

 
1.2

 
$36.85
 
119,128

 
3.9

 
2.1

 
$22.76
 
2,530

 
2.6

 
—

 
$185.40
 
192,377

 
3.3

 
$30.08
2020
 
186,820

 
7.1

 
3.2

 
$30.52
 
195,648

 
6.4

 
3.4

 
$22.04
 
1,951

 
2.0

 
—

 
$141.63
 
384,419

 
6.6

 
$26.77
2021
 
85,490

 
3.2

 
1.5

 
$32.46
 
53,846

 
1.8

 
0.9

 
$48.96
 
10,242

 
10.6

 
0.2

 
$203.13
 
149,578

 
2.6

 
$50.09
2022
 
334,666

 
12.7

 
5.8

 
$35.52
 
88,323

 
2.9

 
1.5

 
$35.20
 
11,464

 
11.9

 
0.2

 
$76.71
 
434,453

 
7.5

 
$36.54
2023
 
149,772

 
5.7

 
2.6

 
$36.17
 
176,447

 
5.8

 
3.0

 
$31.28
 
—

 
—

 
—

 
—
 
326,219

 
5.6

 
$33.53
Thereafter
 
818,715

(2) 
31.0

 
14.1

 
$35.35
 
1,796,449

 
58.6

 
30.9

 
$19.86
 
28,622

 
29.6

 
0.5

 
$47.70
 
2,643,786

 
45.5

 
$24.96
Signed Leases Not Commenced
 
45,615

 
1.7

 
0.8

 
—
 
128,185

 
4.2

 
2.2

 
—
 
—

 
—

 
—

 
—
 
173,800

 
3.0

 
—
Available
 
270,048

 
10.2

 
4.6

 
—
 
92,402

 
3.0

 
1.6

 
—
 
2,084

 
2.2

 
—

 
—
 
364,534

 
6.3

 
—
Total (3)
 
2,644,792

 
100.0
%
 
45.5
%
 
$29.63
 
3,067,657

 
100.0
%
 
52.8
%
 
$22.75
 
96,707

 
100.0
%
 
1.7
%
 
$105.84
 
5,809,156

 
100.0
%
 
$27.27

Fourth Quarter 2013 Supplemental Information
                               Page 28

 
 
LEASE EXPIRATIONS (CONTINUED)
 
 

As of December 31, 2013
 
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 December 31, 2013 for the leases expiring during the applicable period by (ii) 12 months.
(2)
The expirations include 22,105 square feet currently leased by Integra Telecom Holdings, Inc. at Lloyd District Portfolio through May 31, 2014 which Familycare, Inc. has signed an agreement to lease such space beginning October 1, 2014 through September 30, 2024 with options to extend the lease through September 30, 2034.
(3)
Individual items may not add up to total due to rounding.

Fourth Quarter 2013 Supplemental Information
                               Page 29

 
 
PORTFOLIO LEASED STATISTICS
 
 

 
 
At December 31, 2013
 
At December 31, 2012
Type
 
Size
 
Leased (1)
 
Leased %
 
Size
 
Leased (1)
 
Leased %
Overall Portfolio (2) Statistics
 
 
 
 
 
 
 
 
 
 
 
 
Retail Properties (square feet)
 
3,067,657

 
2,975,255

 
97.0
%
 
3,068,645

 
2,975,609

 
97.0
%
Office Properties (square feet) 
 
2,644,792

 
2,374,744

 
89.8
%
 
2,645,567

 
2,468,199

 
93.3
%
Multifamily Properties (units)
 
922

 
889

 
96.4
%
 
922

 
873

 
94.7
%
Mixed-Use Properties (square feet)
 
96,707

 
94,623

 
97.8
%
 
96,707

 
92,333

 
95.5
%
Mixed-Use Properties (units)
 
369

 
322

(3) 
87.2
%
 
369

 
328

(3) 
88.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Same-Store(2) Statistics
 
 
 
 
 
 
 
 
 
 
 
 
Retail Properties (square feet)
 
3,032,501

 
2,940,099

 
97.0
%
 
3,033,489

(4) 
2,940,453

 
96.9
%
Office Properties (square feet)
 
1,587,564

 
1,454,061

 
91.6
%
 
995,182

(5) 
977,068

 
98.2
%
Multifamily Properties (units)
 
922

 
889

 
96.4
%
 
922

 
873

 
94.7
%
Mixed-Use Properties (square feet)
 
96,707

 
94,623

 
97.8
%
 
96,707

 
92,333

 
95.5
%
Mixed-Use Properties (units)
 
369

 
322

(3) 
87.2
%
 
369

 
328

(3) 
88.9
%

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 year ended December 31, 2013 and 2012.
(4)
The same-store portfolio excludes Geary Marketplace, as it was acquired on December 19, 2012.
(5)
The same-store portfolio excludes One Beach Street, as it was acquired on January 24, 2012, City Center Bellevue, as it was acquired on August 21, 2012, and Torrey Reserve Campus and Lloyd District Portfolio due to significant redevelopment activity.

Fourth Quarter 2013 Supplemental Information
                               Page 30

 
 
TOP TENANTS - RETAIL
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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

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

 
5.1
%
 
2.7
%
 
$
4,307,153

 
6.2
%
 
2.7
%
2

Kmart
 
Waikele Center
 
6/30/2018
 
119,590

 
3.9

 
2.1

 
4,185,650

 
6.0

 
2.6

3

Foodland Super Market
 
Waikele Center
 
1/25/2014
 
50,000

 
1.6

 
0.9

 
2,528,220

 
3.6

 
1.6

4

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

 
3.0

 
1.6

 
2,133,950

 
3.1

 
1.3

5

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

 
2.3

 
1.2

 
1,990,316

 
2.9

 
1.3

6

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

 
1,789,248

 
2.6

 
1.1

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

 
0.8

9

Officemax
 
Alamo Quarry Market,
Waikele Center
 
9/30/2017
1/31/2019
 
47,962

 
1.6

 
0.8

 
1,176,511

 
1.7

 
0.7

10

Marshalls
 
Solana Beach Towne Centre,
Carmel Mountain Plaza
 
1/31/2015
1/31/2019
 
68,055

 
2.2

 
1.2

 
1,175,170

 
1.7

 
0.7

 
Top 10 Retail Tenants Total
 
 
 
781,482

 
25.5
%
 
13.6
%
 
$
20,502,918

 
29.5
%
 
12.8
%


*
Data withheld at tenant's request.

Fourth Quarter 2013 Supplemental Information
                               Page 31

 
 
TOP TENANTS - OFFICE
 
 

As of December 31, 2013
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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
%
 
$
12,461,668

 
15.9
%
 
7.9
%
2

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

 
4.3

 
2.0

 
5,274,941

 
6.7

 
3.3

3

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

 
3.5

 
1.6

 
3,006,453

 
3.8

 
1.9

4

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

 
3.1

 
1.4

 
2,523,121

 
3.2

 
1.6

5

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

 
2.4

 
1.1

 
2,184,302

 
2.8

 
1.4

6

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

 
2.6

 
1.2

 
2,166,598

 
2.8

 
1.4

7

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

 
2.1

 
1.0

 
1,932,828

 
2.5

 
1.2

8

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

 
2.4

 
1.1

 
1,786,072

 
2.3

 
1.1

9

Portland Energy Conservation
 
First & Main
 
1/31/2021
 
73,422

 
2.8

 
1.3

 
1,635,827

 
2.1

 
1.0

10

Integra Telecom Holdings, Inc.
 
Lloyd District Portfolio
 
1/31/2014 5/31/2014
11/30/2014
 
67,959

 
2.6

 
1.2

 
1,520,766

 
1.9

 
1.0

 
Top 10 Office Tenants Total
 
 
 
937,564

 
35.4
%
 
16.3
%
 
$
34,492,576

 
44.0
%
 
21.8
%




Fourth Quarter 2013 Supplemental Information
                               Page 32

 
 
 
 
 






APPENDIX





Fourth Quarter 2013 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 and year ended December 31, 2013 and 2012 is as follows:
    
 
 
Three Months Ended
 
Year Ended
 
 
December 31,
 
December 31,
 
 
2013
 
2012
 
2013
 
2012
Net income
 
$
6,907

 
$
41,821

 
$
22,594

 
$
51,601

Depreciation and amortization (including discontinued operations)
 
16,161

 
16,656

 
66,775

 
63,011

Interest expense (including discontinued operations)
 
13,776

 
15,521

 
58,020

 
59,043

Interest income
 
(60
)
 
(7
)
 
(148
)
 
(336
)
Income tax expense
 
(216
)
 
460

 
645

 
1,016

Gain on sale of real estate
 
—

 
(36,720
)
 
—

 
(36,720
)
EBITDA
 
$
36,568

 
$
37,731

 
$
147,886

 
$
137,615


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.



Fourth Quarter 2013 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
 
Year Ended
 
 
December 31,
 
December 31,
Reconciliation of NOI to net income
 
2013
 
2012
 
2013
 
2012
Total NOI
 
$
41,105

 
$
40,886

 
$
165,071

 
$
149,352

General and administrative
 
(4,537
)
 
(4,063
)
 
(17,195
)
 
(15,593
)
Depreciation and amortization
 
(16,161
)
 
(16,576
)
 
(66,775
)
 
(61,853
)
Interest expense
 
(13,776
)
 
(15,152
)
 
(58,020
)
 
(57,328
)
Other income (expense), net
 
276

 
(273
)
 
(487
)
 
(629
)
Income from continuing operations
 
6,907

 
4,822

 
22,594

 
13,949

Discontinued operations
 
 
 
 
 
 
 
 
Income from discontinued operations
 
—

 
279

 
—

 
932

Gain on sale of real estate property
 
—

 
36,720

 
—

 
36,720

Results from discontinued operations
 
—

 
36,999

 
—

 
37,652

Net income
 
6,907

 
41,821

 
22,594

 
51,601

Net income attributable to restricted shares
 
(139
)
 
(133
)
 
(536
)
 
(529
)
Net loss attributable to unitholders in the Operating Partnership
 
(2,086
)
 
(13,111
)
 
(6,838
)
 
(16,133
)
Net income attributable to American Assets Trust, Inc. stockholders
 
$
4,682

 
$
28,577

 
$
15,220

 
$
34,939


Overall Portfolio: Includes all operating properties owned by us as of December 31, 2013.


Fourth Quarter 2013 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
 
Comparison of Year Ended
 
December 31, 2013 to 2012
 
December 31, 2013 to 2012
 
Same-Store
 
Non Same-Store
 
Redevelopment Same-Store
 
Same-Store
 
Non Same-Store
 
Redevelopment Same-Store
Retail Properties
 
 
 
 
 
 
 
 
 
 
 
Carmel Country Plaza
X
 
 
 
X
 
X
 
 
 
X
Carmel Mountain Plaza
X
 
 
 
X
 
X
 
 
 
X
South Bay Marketplace
X
 
 
 
X
 
X
 
 
 
X
Rancho Carmel Plaza
X
 
 
 
X
 
X
 
 
 
X
Lomas Santa Fe Plaza
X
 
 
 
X
 
X
 
 
 
X
Solana Beach Towne Centre
X
 
 
 
X
 
X
 
 
 
X
Del Monte Center
X
 
 
 
X
 
X
 
 
 
X
Geary Marketplace
 
 
X
 
 
 
 
 
X
 
 
The Shops at Kalakaua
X
 
 
 
X
 
X
 
 
 
X
Waikele Center
X
 
 
 
X
 
X
 
 
 
X
Alamo Quarry Market
X
 
 
 
X
 
X
 
 
 
X
Office Properties
 
 
 
 
 
 
 
 
 
 
 
Torrey Reserve Campus
 
 
X
 
X
 
 
 
X
 
X
Solana Beach Corporate Centre
X
 
 
 
X
 
X
 
 
 
X
The Landmark at One Market
X
 
 
 
X
 
X
 
 
 
X
One Beach Street
X
 
 
 
X
 
 
 
X
 
 
First & Main
X
 
 
 
X
 
X
 
 
 
X
Lloyd District Portfolio
 
 
X
 
X
 
 
 
X
 
X
City Center Bellevue
X
 
 
 
X
 
 
 
X
 
 
Multifamily Properties
 
 
 
 
 
 
 
 
 
 
 
Loma Palisades
X
 
 
 
X
 
X
 
 
 
X
Imperial Beach Gardens
X
 
 
 
X
 
X
 
 
 
X
Mariner's Point
X
 
 
 
X
 
X
 
 
 
X
Santa Fe Park RV Resort
X
 
 
 
X
 
X
 
 
 
X
Mixed-Use Properties
 
 
 
 
 
 
 
 
 
 
 
Waikiki Beach Walk - Retail
X
 
 
 
X
 
X
 
 
 
X
Waikiki Beach Walk - Embassy Suites™
X
 
 
 
X
 
X
 
 
 
X
Development Properties
 
 
 
 
 
 
 
 
 
 
 
Sorrento Pointe - Land
 
 
X
 
 
 
 
 
X
 
 
Torrey Reserve - Land
 
 
X
 
 
 
 
 
X
 
 
Solana Beach Corporate Centre - Land
 
 
X
 
 
 
 
 
X
 
 
Solana Beach - Highway 101 - Land
 
 
X
 
 
 
 
 
X
 
 
Lloyd District Portfolio - Land
 
 
X
 
 
 
 
 
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.

Fourth Quarter 2013 Supplemental Information
                               Page 36