Equity Commonwealth (NYSE: EQC) today reported financial results
for the quarter and year ended December 31, 2021.
Financial results for the quarter ended December 31,
2021
Net loss attributable to common shareholders was $3.6 million,
or $0.03 per diluted share, for the quarter ended December 31,
2021. This compares to net loss attributable to common shareholders
of $3.7 million, or $0.03 per diluted share, for the quarter ended
December 31, 2020.
Funds from Operations, or FFO, as defined by the National
Association of Real Estate Investment Trusts, for the quarter ended
December 31, 2021, were $0.7 million, or $0.01 per diluted share.
This compares to FFO for the quarter ended December 30, 2020 of
$0.6 million, or $0.00 per diluted share.
Normalized FFO was $0.4 million, or $0.00 per diluted share, for
the quarter ended December 31, 2021. This compares to Normalized
FFO for the quarter ended December 31, 2020 of $0.6 million, or
$0.00 per diluted share.
Same property results for the quarter ended December 31,
2021
The company’s same property portfolio at the end of the quarter
consisted of 4 properties totaling 1.5 million square feet.
Operating results were as follows:
- The same property portfolio was 82.3% leased as of December 31,
2021, compared to 82.5% as of September 30, 2021, and 85.7% as of
December 31, 2020.
- The same property portfolio commenced occupancy was 79.2% as of
December 31, 2021, compared to 78.6% as of September 30, 2021, and
81.7% as of December 31, 2020.
- Same property NOI increased 5.2% when compared to the same
period in 2020.
- Same property cash NOI increased 0.8% when compared to the same
period in 2020.
- The company entered into leases for approximately 51,000 square
feet, including renewal leases for approximately 16,000 square feet
and new leases for approximately 35,000 square feet.
- The GAAP rental rate on new and renewal leases was 2.8% higher
compared to the prior GAAP rental rate for the same space.
- The cash rental rate on new and renewal leases was flat
compared to the prior cash rental rate for the same space.
The definitions and reconciliations of same property NOI and
same property cash NOI to net loss, determined in accordance with
GAAP, are included at the end of this press release. The same
property portfolio at the end of the quarter included properties
continuously owned from October 1, 2020 through December 31,
2021.
Financial results for the year ended December 31,
2021
Net loss attributable to common shareholders was $24.4 million,
or $0.20 per diluted share, for the year ended December 31, 2021.
This compares to net income attributable to common shareholders of
$443.3 million, or $3.56 per diluted share, for the year ended
December 31, 2020. The decline in net income was primarily a result
of a decrease in gains on the sale of properties and a decrease in
interest and other income.
FFO for the year ended December 31, 2021, was ($6.8) million, or
($0.06) per diluted share. This compares to FFO for the year ended
December 30, 2020 of $15.8 million, or $0.13 per diluted share. The
following items impacted FFO for the year ended December 31, 2021,
compared to the corresponding 2020 period:
- ($0.12) per diluted share decrease in interest income and
other, net;
- ($0.03) per diluted share increase in general and
administrative expense, including executive severance;
- ($0.02) per diluted share decrease in NOI from properties sold;
and
- ($0.02) per diluted share decrease in same property NOI.
Normalized FFO was ($1.3) million, or ($0.01) per diluted share,
for the year ended December 31, 2021. This compares to Normalized
FFO for the year ended December 31, 2020 of $18.1 million, or $0.15
per diluted share. The following items impacted Normalized FFO for
the year ended December 31, 2021, compared to the corresponding
2020 period:
- ($0.12) per diluted share decrease in interest income and
other, net;
- ($0.03) per diluted share decrease in same property cash NOI
and lease termination fees;
- ($0.03) per diluted share decrease in NOI from properties sold;
and
- $0.01 per diluted share decrease in general and administrative
expense, excluding executive severance.
As of December 31, 2021, the company’s cash and cash equivalents
balance was $2.8 billion.
Normalized FFO begins with FFO and eliminates certain items
that, by their nature, are not comparable from period to period,
non-cash items, and items that obscure the company’s operating
performance. Definitions of FFO, Normalized FFO and reconciliations
to net income (loss), determined in accordance with U.S. generally
accepted accounting principles, or GAAP, are included at the end of
this press release.
Same property results for the year ended December 31,
2021
The company’s same property portfolio at the end of the year
consisted of 4 properties totaling 1.5 million square feet.
Operating results were as follows:
- Same property NOI decreased 7.2% when compared to the same
period in 2020. The decrease was largely due to lower commenced
occupancy, lower lease termination fees, and lower parking revenue.
The decrease was partially offset by an increase in tenant
reimbursements.
- Same property cash NOI decreased 8.8% when compared to the same
period in 2020. The decrease was largely due to lower commenced
occupancy, an increase in free rent, and a decrease in parking
revenue.
- The company entered into leases for approximately 116,000
square feet, including renewal leases for approximately 56,000
square feet and new leases for approximately 60,000 square
feet.
- The GAAP rental rate on the new and renewal leases was 4.3%
higher compared to the prior GAAP rental rate for the same
space.
- The cash rental rate on the new and renewal leases was 0.3%
lower compared to the prior cash rental rate for the same
space.
The definitions and reconciliations of same property NOI and
same property cash NOI to net (loss) income, determined in
accordance with GAAP, are included at the end of this press
release. The same property portfolio at the end of the year
included properties continuously owned from January 1, 2020 through
December 31, 2021.
Significant events during the year ended December 31,
2021
- Effective March 31, 2021, Adam Markman stepped down from his
role as Executive Vice President, Chief Financial Officer and
Treasurer. As a result, the company had $3.7 million of cash
severance expense and $3.4 million of expense related to the
acceleration of stock awards, including awards that remain subject
to performance-based vesting conditions.
- On April 1, 2021, Bill Griffiths was appointed Senior Vice
President, Chief Financial Officer and Treasurer. Mr. Griffiths
previously served as Senior Vice President of Capital Markets for
the Company.
- On August 31, 2021, Equity Commonwealth terminated its May 4,
2021 merger agreement to acquire Monmouth Real Estate Investment
Corporation, a publicly-traded industrial REIT, following
Monmouth’s failure to obtain shareholder approval of the merger.
Equity Commonwealth was subsequently reimbursed by Monmouth for the
company’s out-of-pocket expenses incurred in connection with the
proposed merger, which totaled approximately $10 million. Equity
Commonwealth does not under the current facts and circumstances
expect to receive any additional fees or reimbursement related to
the termination of the merger agreement.
- On December 14, 2021, the Board of Trustees authorized the
repurchase, through December 31, 2022, of an additional $150
million of its outstanding common shares under the company’s
existing share repurchase program. The company has utilized the
$150 million previously authorized by the Board of Trustees on
March 1, 2021.
- During the quarter ended December 31, 2021, the company
repurchased 6,304,939 of its common shares at a weighted average
price of $25.86 per share, for a total investment of $163.1
million. During 2021, the company repurchased 6,735,810 of its
common shares, at a weighted average price of $25.85 per share, for
a total investment of $174.1 million.
Subsequent Events
- On January 26, 2022, the Board of Trustees promoted Bill
Griffiths to Executive Vice President, CFO and Treasurer from
Senior Vice President, CFO and Treasurer, effective February 14,
2022.
- On February 7, 2022, Jeff Brown, stepped down from his role as
Senior Vice President and Chief Accounting Officer for personal
reasons, effective March 11, 2022. Mr. Brown’s decision to resign
was not a result of any disagreement with management or the Board
of Trustees.
- On February 8, 2022, Andrew Levy, was promoted to Senior Vice
President and Chief Accounting Officer, effective March 12, 2022.
Mr. Levy also will serve as the Company’s designated principal
financial officer for Securities and Exchange Commission (“SEC”)
reporting purposes. Mr. Levy previously served as Vice President of
Financial Reporting and has been with the company since 2014.
Earlier in his career, Mr. Levy served as a senior manager in the
financial reporting team at General Growth Properties and as an
associate with Deloitte & Touche LLP. Mr. Levy is a Certified
Public Accountant registered in Illinois and holds a Bachelors and
Masters degree in Accountancy from the University of Notre
Dame.
- Subsequent to year-end, as of February 8, 2022, the company
repurchased 2,202,866 of its common shares at a weighted average
price of $25.78 per share for a total investment of $56.8 million.
The company has $69.1 million of remaining authorization available
under its share repurchase program, as of February 8, 2022.
Earnings Conference Call & Supplemental Operating and
Financial Information
Equity Commonwealth will host a conference call to discuss
fourth quarter and full year results on Thursday, February 10,
2022, at 9:00 A.M. CT. The conference call will be available via
live audio webcast on the Investor Relations section of the
company’s website (www.eqcre.com). A replay of the audio webcast
will also be available following the call.
A copy of EQC’s Full Year 2021 Supplemental Operating and
Financial Information is available in the Investor Relations
section of EQC’s website at www.eqcre.com.
About Equity Commonwealth
Equity Commonwealth (NYSE: EQC) is a Chicago based, internally
managed and self-advised real estate investment trust (REIT) with
commercial office properties in the United States. EQC’s portfolio
is comprised of four properties totaling 1.5 million square
feet.
Regulation FD Disclosures
We use any of the following to comply with our disclosure
obligations under Regulation FD: press releases, SEC filings,
public conference calls, or our website. We routinely post
important information on our website at www.eqcre.com, including
information that may be deemed to be material. We encourage
investors and others interested in the company to monitor these
distribution channels for material disclosures.
Forward-Looking Statements
Some of the statements contained in this press release
constitute forward-looking statements within the meaning of the
federal securities laws. Any forward-looking statements contained
in this press release are intended to be made pursuant to the safe
harbor provisions of Section 21E of the Securities Exchange Act of
1934, as amended. 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. You can identify
forward-looking statements by the use of forward-looking
terminology or words, which are predictions of or indicate future
events or trends and do not relate solely to historical matters.
You can also identify forward-looking statements by discussions of
strategy, plans or intentions.
The forward-looking statements contained in this press release
reflect our current views about future events and are subject to
numerous known and unknown risks, uncertainties, assumptions and
changes in circumstances that may cause our actual results to
differ significantly from those expressed in any forward-looking
statement. We do not guarantee that the transactions and events
described will happen as described (or that they will happen at
all). We disclaim 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. For a further discussion of these and
other factors that could cause our future results to differ
materially from any forward-looking statements, see the section
entitled “Risk Factors” in our most recent Annual Report on Form
10-K and subsequent quarterly reports on Form 10-Q.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited, amounts in thousands,
except share data)
December 31,
ASSETS
2021
2020
Real estate properties:
Land
$
44,060
$
44,060
Buildings and improvements
362,042
357,650
406,102
401,710
Accumulated depreciation
(156,439
)
(143,319
)
249,663
258,391
Cash and cash equivalents
2,800,998
2,987,225
Rents receivable
15,549
14,702
Other assets, net
15,173
17,353
Total assets
$
3,081,383
$
3,277,671
LIABILITIES AND EQUITY
Accounts payable, accrued expenses and
other
$
19,762
$
20,588
Rent collected in advance
3,986
2,928
Distributions payable
2,365
10,991
Total liabilities
$
26,113
$
34,507
Shareholders’ equity:
Preferred shares of beneficial interest,
$0.01 par value: 50,000,000
shares authorized;
Series D preferred shares; 6.50%
cumulative convertible; 4,915,196
shares issued and outstanding, aggregate
liquidation preference of
$122,880
$
119,263
$
119,263
Common shares of beneficial interest,
$0.01 par value: 350,000,000
shares authorized; 115,205,818 and
121,522,555 shares issued
and outstanding, respectively
1,152
1,215
Additional paid in capital
4,128,656
4,294,632
Cumulative net income
3,798,552
3,814,948
Cumulative common distributions
(4,281,195
)
(4,283,668
)
Cumulative preferred distributions
(717,700
)
(709,712
)
Total shareholders' equity
3,048,728
3,236,678
Noncontrolling interest
6,542
6,486
Total equity
$
3,055,270
$
3,243,164
Total liabilities and equity
$
3,081,383
$
3,277,671
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited, amounts in
thousands, except per share data)
Three Months Ended
Year Ended
December 31,
December 31,
2021
2020
2021
2020
Revenues:
Rental revenue
$
13,503
$
14,001
$
54,927
$
62,134
Other revenue (1)
892
707
3,075
4,144
Total revenues
$
14,395
$
14,708
$
58,002
$
66,278
Expenses:
Operating expenses
$
6,582
$
6,976
$
25,893
$
28,858
Depreciation and amortization
4,403
4,680
17,774
19,329
General and administrative
6,753
7,136
37,444
33,233
Total expenses
$
17,738
$
18,792
$
81,111
$
81,420
Interest and other income, net
1,732
2,284
6,800
21,228
Interest expense (including net
amortization of debt
premiums and deferred financing fees of
$—, $—,
$—, and $(119), respectively)
—
—
—
(620
)
Gain on early extinguishment of debt
—
—
—
131
Gain on sale of properties, net
—
208
—
446,744
(Loss) income before income taxes
(1,611
)
(1,592
)
(16,309
)
452,341
Income tax expense
(26
)
(78
)
(120
)
(248
)
Net (loss) income
$
(1,637
)
$
(1,670
)
$
(16,429
)
$
452,093
Net loss (income) attributable to
noncontrolling interest
3
4
33
(799
)
Net (loss) income attributable to
Equity
Commonwealth
$
(1,634
)
$
(1,666
)
$
(16,396
)
$
451,294
Preferred distributions
(1,997
)
(1,997
)
(7,988
)
(7,988
)
Net (loss) income attributable to
Equity
Commonwealth common
shareholders
$
(3,631
)
$
(3,663
)
$
(24,384
)
$
443,306
Weighted average common shares outstanding
—
basic (2)
119,285
121,673
121,411
121,786
Weighted average common shares outstanding
—
diluted (2)(3)
119,285
121,673
121,411
126,606
Earnings per common share attributable to
Equity
Commonwealth common shareholders:
Basic
$
(0.03
)
$
(0.03
)
$
(0.20
)
$
3.64
Diluted
$
(0.03
)
$
(0.03
)
$
(0.20
)
$
3.56
(1)
Other revenue is primarily comprised of
parking revenue that does not represent a component of a lease.
(2)
Weighted average common shares outstanding
for the three months ended December 31, 2021 and 2020 includes 260
and 150 unvested, earned RSUs, respectively. Weighted average
common shares outstanding for the year ended December 31, 2021 and
2020 includes 256 and 157 unvested, earned RSUs, respectively.
(3)
As of December 31, 2021 and 2020, we had
4,915 series D preferred shares that were convertible into 3,237
common shares. The series D preferred shares are antidilutive for
GAAP EPS for the three months and year ended December 31, 2021 and
for the three months ended December 31, 2020. They are dilutive for
GAAP EPS for the year ended December 31, 2020.
CALCULATION OF FUNDS FROM
OPERATIONS (FFO) AND NORMALIZED FFO
(Unaudited, amounts in
thousands, except per share data)
Three Months
Ended
Year Ended
December 31,
December 31,
2021
2020
2021
2020
Calculation of FFO
Net (loss) income
$
(1,637
)
$
(1,670
)
$
(16,429
)
$
452,093
Real estate depreciation and
amortization
4,361
4,470
17,593
18,442
Gain on sale of properties, net
—
(208
)
—
(446,744
)
FFO attributable to Equity
Commonwealth
2,724
2,592
1,164
23,791
Preferred distributions
(1,997
)
(1,997
)
(7,988
)
(7,988
)
FFO attributable to EQC common
shareholders and unitholders
$
727
$
595
$
(6,824
)
$
15,803
Calculation of Normalized FFO
FFO attributable to EQC common
shareholders and unitholders
$
727
$
595
$
(6,824
)
$
15,803
Straight-line rent adjustments
(130
)
(6
)
(1,407
)
340
Sold property expense included in interest
and other income, net
(225
)
—
(225
)
515
Gain on early extinguishment of debt
—
—
—
(131
)
Executive severance expense
—
—
7,107
—
Taxes related to property sales included
in general and administrative
—
14
—
1,472
Taxes related to property sales, net
included in income tax expense
—
(48
)
—
130
Normalized FFO attributable to EQC
common shareholders and
unitholders
$
372
$
555
$
(1,349
)
$
18,129
Weighted average common shares and units
outstanding -- basic (1)
119,532
121,916
121,656
122,007
Weighted average common shares and units
outstanding -- diluted (1)
119,958
123,445
121,656
123,590
FFO attributable to EQC common
shareholders and unitholders per share
and unit -- basic and diluted
$
0.01
$
0.00
$
(0.06
)
$
0.13
Normalized FFO attributable to EQC common
shareholders and
unitholders per share and unit -- basic
and diluted
$
0.00
$
0.00
$
(0.01
)
$
0.15
(1)
Our calculations of FFO and Normalized FFO
attributable to EQC common shareholders and unitholders per
share and unit - basic for the three months ended December 31, 2021
and 2020 include 247 and 243 LTIP/Operating Partnership Units,
respectively, that are excluded from the calculation of basic
earnings per common share attributable to EQC common
shareholders (only). Our calculations of FFO and Normalized FFO
attributable to EQC common shareholders and unitholders per
share and unit - basic for the year ended December 31, 2021 and
2020 include 245 and 221 LTIP/Operating Partnership Units,
respectively, that are excluded from the calculation of basic
earnings per common share attributable to EQC common
shareholders (only).
We compute FFO in accordance with
standards established by Nareit. Nareit defines FFO as net income
(loss), calculated in accordance with GAAP, excluding real estate
depreciation and amortization, gains (or losses) from sales of
depreciable property, impairment of depreciable real estate and our
portion of these items related to equity investees and
noncontrolling interests. Our calculation of Normalized FFO differs
from Nareit’s definition of FFO because we exclude certain items
that we view as nonrecurring or impacting comparability from period
to period. FFO and Normalized FFO are supplemental non-GAAP
financial measures. We consider FFO and Normalized FFO to be
appropriate measures of operating performance for a REIT, along
with net income (loss), net income (loss) attributable to EQC
common shareholders and cash flow from operating activities.
We believe that FFO and Normalized FFO
provide useful information to investors because by excluding the
effects of certain historical amounts, such as depreciation
expense, FFO and Normalized FFO may facilitate a comparison of our
operating performance between periods and with other REITs. FFO and
Normalized FFO do not represent cash generated by operating
activities in accordance with GAAP and should not be considered as
alternatives to net income (loss), net income (loss) attributable
to EQC common shareholders or cash flow from operating activities,
determined in accordance with GAAP, or as indicators of our
financial performance or liquidity, nor are these measures
necessarily indicative of sufficient cash flow to fund all of our
needs. These measures should be considered in conjunction with net
income (loss), net income (loss) attributable to EQC common
shareholders and cash flow from operating activities as presented
in our condensed consolidated statements of operations, condensed
consolidated statements of comprehensive income and condensed
consolidated statements of cash flows. Other REITs and real estate
companies may calculate FFO and Normalized FFO differently than we
do.
CALCULATION OF SAME PROPERTY
NET OPERATING INCOME (NOI) AND SAME PROPERTY CASH BASIS NOI
(Unaudited, amounts in
thousands)
Three Months Ended
12/31/2021
9/30/2021
6/30/2021
3/31/2021
12/31/2020
Calculation of Same Property NOI and
Same Property
Cash Basis NOI:
Rental revenue
$
13,503
$
13,141
$
14,114
$
14,169
$
14,001
Other revenue (1)
892
740
761
682
707
Operating expenses
(6,582
)
(6,102
)
(6,588
)
(6,621
)
(6,976
)
NOI
$
7,813
$
7,779
$
8,287
$
8,230
$
7,732
Straight-line rent adjustments
(130
)
(409
)
(561
)
(307
)
(6
)
Lease termination fees
(209
)
(7
)
—
—
(10
)
Cash Basis NOI
$
7,474
$
7,363
$
7,726
$
7,923
$
7,716
Cash Basis NOI from non-same properties
(2)
(111
)
12
22
(124
)
(415
)
Same Property Cash Basis NOI
$
7,363
$
7,375
$
7,748
$
7,799
$
7,301
Non-cash rental income and lease
termination fees from same properties
338
416
561
307
16
Same Property NOI
$
7,701
$
7,791
$
8,309
$
8,106
$
7,317
Reconciliation of Same Property NOI to
GAAP Net Loss:
Same Property NOI
$
7,701
$
7,791
$
8,309
$
8,106
$
7,317
Non-cash rental income and termination
fees from same properties
(338
)
(416
)
(561
)
(307
)
(16
)
Same Property Cash Basis NOI
$
7,363
$
7,375
$
7,748
$
7,799
$
7,301
Cash Basis NOI from non-same properties
(2)
111
(12
)
(22
)
124
415
Cash Basis NOI
$
7,474
$
7,363
$
7,726
$
7,923
$
7,716
Straight-line rent adjustments
130
409
561
307
6
Lease termination fees
209
7
—
—
10
NOI
$
7,813
$
7,779
$
8,287
$
8,230
$
7,732
Depreciation and amortization
(4,403
)
(4,588
)
(4,432
)
(4,351
)
(4,680
)
General and administrative
(6,753
)
(7,572
)
(7,390
)
(15,729
)
(7,136
)
Interest and other income, net
1,732
1,599
1,626
1,843
2,284
Gain on sale of properties, net
—
—
—
—
208
Loss before income taxes
$
(1,611
)
$
(2,782
)
$
(1,909
)
$
(10,007
)
$
(1,592
)
Income tax expense
(26
)
(32
)
(31
)
(31
)
(78
)
Net loss
$
(1,637
)
$
(2,814
)
$
(1,940
)
$
(10,038
)
$
(1,670
)
(1)
Other revenue is primarily comprised of
parking revenue that does not represent a component of a lease.
(2)
Cash Basis NOI from non-same properties
for all periods presented includes the operations of disposed
properties.
CALCULATION OF SAME PROPERTY
NET OPERATING INCOME (NOI) AND SAME PROPERTY CASH BASIS NOI
(Unaudited, amounts in
thousands)
For the Year Ended December
31,
2021
2020
Calculation of Same Property NOI and
Same Property Cash Basis NOI:
Rental revenue
$
54,927
$
62,134
Other revenue (1)
3,075
4,144
Operating expenses
(25,893
)
(28,858
)
NOI
$
32,109
$
37,420
Straight-line rent adjustments
(1,407
)
340
Lease termination fees
(216
)
(1,310
)
Cash Basis NOI
$
30,486
$
36,450
Cash Basis NOI from non-same properties
(2)
(201
)
(3,253
)
Same Property Cash Basis NOI
$
30,285
$
33,197
Non-cash rental income and lease
termination fees from same properties
1,622
1,169
Same Property NOI
$
31,907
$
34,366
Reconciliation of Same Property NOI to
GAAP Net (Loss) Income:
Same Property NOI
$
31,907
$
34,366
Non-cash rental income and termination
fees from same properties
(1,622
)
(1,169
)
Same Property Cash Basis NOI
$
30,285
$
33,197
Cash Basis NOI from non-same properties
(2)
201
3,253
Cash Basis NOI
$
30,486
$
36,450
Straight-line rent adjustments
1,407
(340
)
Lease termination fees
216
1,310
NOI
$
32,109
$
37,420
Depreciation and amortization
(17,774
)
(19,329
)
General and administrative
(37,444
)
(33,233
)
Interest and other income, net
6,800
21,228
Interest expense
—
(620
)
Gain (loss) on early extinguishment of
debt
—
131
Gain on sale of properties, net
—
446,744
(Loss) income before income
taxes
$
(16,309
)
$
452,341
Income tax expense
(120
)
(248
)
Net (loss) income
$
(16,429
)
$
452,093
(1)
Other revenue is primarily comprised of
parking revenue that does not represent a component of a lease.
(2)
Cash Basis NOI from non-same properties
for all periods presented includes the operations of disposed
properties.
NOI is income from our real estate
including lease termination fees received from tenants less our
property operating expenses. NOI excludes amortization of
capitalized tenant improvement costs and leasing commissions and
corporate level expenses. Cash Basis NOI is NOI excluding the
effects of straight line rent adjustments, lease value amortization
and lease termination fees. The quarter-to-date same property
versions of these measures include the results of properties
continuously owned from October 1, 2020 through December 31, 2021.
The year-to-date same property versions of these measures include
the results of properties continuously owned from January 1, 2020
through December 31, 2021. Properties classified as held for sale
within our condensed consolidated balance sheets are excluded from
the same property versions of these measures.
We consider these supplemental non-GAAP
financial measures to be appropriate supplemental measures to net
income (loss) because they may help to understand the operations of
our properties. We use these measures internally to evaluate
property level performance, and we believe that they provide useful
information to investors regarding our results of operations
because they reflect only those income and expense items that are
incurred at the property level and may facilitate comparisons of
our operating performance between periods and with other REITs.
Cash Basis NOI is among the factors considered with respect to
acquisition, disposition and financing decisions. These measures do
not represent cash generated by operating activities in accordance
with GAAP and should not be considered as an alternative to net
income (loss), net income (loss) attributable to Equity
Commonwealth common shareholders or cash flow from operating
activities, determined in accordance with GAAP, or as indicators of
our financial performance or liquidity, nor are these measures
necessarily indicative of sufficient cash flow to fund all of our
needs. These measures should be considered in conjunction with net
income (loss), net income (loss) attributable to EQC common
shareholders and cash flow from operating activities as presented
in our condensed consolidated statements of operations, condensed
consolidated statements of comprehensive income and condensed
consolidated statements of cash flows. Other REITs and real estate
companies may calculate these measures differently than we do.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220209005936/en/
Sarah Byrnes, Investor Relations (312) 646-2801 ir@eqcre.com
Equity Commonwealth (NYSE:EQC)
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