Page
Summary and Corporate Information………………………………………………………………………………………………………………………………………………………… i, ii, iii
Consolidated Statements of Income…………………………………………………………………………………………………………………………………………………….1
Funds from Operations and Additional Information………………………………………………………………………………………………………………………………… 2
Consolidated Balance Sheets……………………………………………………………………………………………………………………………………………………………..3
Capitalization, Net debt-to-Adjusted EBITDAre and Revenue Detail…………………………………………………………………………………………………………………………….4
Mortgages and Notes Payable Summary……………………………………………………………………………………………………………………………………………..5
Mortgages and Notes Payable Detail…………………………………………………………………………………………………………………………………………………….6
Portfolio Summary………………………………………………………………………………………………………………………………………………………………………….7, 8
Occupancy Trends………………………………………………………………………………………………………………………………………………………………………9
Office Leasing Statistics...……………………………………………………………………………………………………………………………………………………………..10
Office Leasing Statistics and Rental Rate Comparisons by Market……………………………………………………………………………………………………………….11
Office Lease Expirations……………………………………………………………………………………………………………..…………………………………………………12
Office Lease Expirations by Market by Year……………………………………………………………………………………………………………………………………………13
Customer Diversification…………………………………………………………………………………………………………………………………………………………………..14
Same Property Performance………………………………………………………………………………………………………………………………………………………………15
Disposition Activity……………………………………………………………………………………………………………………………….……………………………………. 16
Development Activity……………………………………………………………………………………………………………………………….…………………………………….17
Land Held for Development………………………………………………………………………………………………………………………………………………………………18
Joint Venture Financial and Summary Information……………………………………………………………………………………………………………………………………..19
Some of the information in this presentation may contain forward-looking statements. Such statements include, in particular, statements about our plans, strategies and
prospects such as the following: the expected financial and operational results and the related assumptions underlying our expected results, including but not limited to
potential losses related to customer difficulties, anticipated building usage and expected economic activity due to COVID-19; the continuing ability to borrow under the
Company’s revolving credit facility; the anticipated total investment, projected leasing activity, estimated replacement cost and expected net operating income of acquired
properties and properties to be developed; and expected future leverage of the Company. You can identify forward-looking statements by our use of forward-looking
terminology such as “may,” “will,” “expect,” “anticipate,” “estimate,” “continue” or other similar words. Although we believe that our plans, intentions and expectations
reflected in or suggested by such forward-looking statements are reasonable, we cannot assure you that our plans, intentions or expectations will be achieved.
When considering such forward-looking statements, you should keep in mind important factors that could cause our actual results to differ materially from those contained in
any forward-looking statement. Currently, one of the most significant factors that could cause actual outcomes to differ materially from our forward-looking statements is the
potential adverse effect of the COVID-19 pandemic, and federal, state, and/or local regulatory guidelines and private business actions to control it, on our financial condition,
operating results and cash flows, our customers, the real estate market in which we operate, the global economy and the financial markets. The extent to which the COVID-19
pandemic impacts us and our customers will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity
and duration of the pandemic and the resulting economic recession and potential changes in customer behavior, among others.
Additional factors, many of which may be influenced by the COVID-19 pandemic, that could cause actual outcomes or results to differ materially from those indicated in
these statements include: the financial condition of our customers could deteriorate or further worsen; our assumptions regarding potential losses related to customer
financial difficulties due to the COVID-19 pandemic could prove incorrect; counterparties under our debt instruments, particularly our revolving credit facility, may attempt to
avoid their obligations thereunder, which, if successful, would reduce our available liquidity; we may not be able to lease or re-lease second generation space, defined as
previously occupied space that becomes available for lease, quickly or on as favorable terms as old leases; we may not be able to lease newly constructed buildings as
quickly or on as favorable terms as originally anticipated; we may not be able to complete development, acquisition, reinvestment, disposition or joint venture projects as
quickly or on as favorable terms as anticipated; development activity in our existing markets could result in an excessive supply relative to customer demand; our markets may
suffer declines in economic and/or office employment growth; unanticipated increases in interest rates could increase our debt service costs; unanticipated increases in
operating expenses could negatively impact our operating results; we may not be able to meet our liquidity requirements or obtain capital on favorable terms to fund our
working capital needs and growth initiatives or repay or refinance outstanding debt upon maturity; and the Company could lose key executive officers.
This list of risks and uncertainties, however, is not intended to be exhaustive. You should also review the other cautionary statements we make in “Business – Risk Factors”
set forth in our 2019 Annual Report on Form 10-K and “Risk Factors” in our second quarter 2020 Quarterly Report on Form 10-Q. Given these uncertainties, you should not
place undue reliance on forward-looking statements. We undertake no obligation to publicly release the results of any revisions to these forward-looking statements to reflect
any future events or circumstances or to reflect the occurrence of unanticipated events.
Due to recent dispositions and actively marketing our remaining Greensboro and Memphis assets for sale, we combined these markets into an Other category beginning
in the second quarter 2020.
All financial information contained in this document is unaudited. This supplemental includes non-GAAP financial measures, such as funds from operations (FFO), earnings
before interest, taxes, depreciation and amortization for real estate (EBITDAre), Adjusted EBITDAre and net operating income (NOI). Definitions of FFO, EBITDAre, Adjusted
EBITDAre and NOI and an explanation of management's view of the usefulness and risks of FFO, EBITDAre, Adjusted EBITDAre and NOI can be found towards the end of
our third quarter earnings release.
COVER
Asurion HQ
Nashville, TN
Table of Contents
TOC
Three Months Ended
9/30/20 9/30/19
Financial:
Revenues 181,043$ 187,475$
Net operating income (NOI) 124,151$ 123,340$
Same property cash NOI growth excluding temporary rent deferrals 2.2% 0.5%
Same property cash NOI growth 1.3% 0.5%
Funds from operations per share 0.86$ 0.83$
Weighted average common shares outstanding, diluted 106,740 106,471
Balance Sheet:
Leverage (including preferred stock) based on gross book assets 1/ 36.6% 36.3%
Net debt-to-Adjusted EBITDAre 5.03x 4.92x
Net debt plus Preferred Stock-to-Adjusted EBITDAre 5.09x 4.98x
Unencumbered NOI % 96.6% 96.4%
Credit facility availability 600,000$ 600,000$
Operations:
Quarter-end occupancy 90.2% 91.4%
Office square feet leased 660 939
Office GAAP rent growth 2/ 12.5% 19.4%
Average office cash rental rate per square foot for in-place leases 28.07$ 26.67$
Nine Months Ended
9/30/20
Investment Activity:
Building acquisitions -$
Building dispositions 361,700$
Land acquisitions 8,526$
Land dispositions 2,825$
Development pipeline 502,581$
Pipeline pre-leased % 78.6%
1/ Debt and gross book assets were reduced by our cash and cash equivalents balance at 9/30/20 and 9/30/19 of $118.7 million and $116.7 million,
respectively.
2/ GAAP rent growth is calculated by comparing average cash rent psf over the term (GAAP rent) of the new lease to the average cash rent psf over
the term related to the previous lease in the same space. Adjustments are made if and to the extent necessary to illustrate the current and prior
deal on a consistent gross lease basis.
Summary (amounts in thousands, except percentages, ratios, and per share amounts)
i
Board of Directors Market Leaders
Chuck Anderson Jim Bacchetta
Gene Anderson Vice President, Atlanta
Tom Anderson Jane duFrane
Carlos Evans, Chair Vice President, Richmond
David Hartzell, Ph.D. Steve Garrity
Sherry Kellett Vice President, Orlando
Ted Klinck Skip Hill
Anne Lloyd Vice President, Raleigh
Brian Reames
Corporate Officers Senior Vice President, Nashville
Andy Wisniewski
Dan Clemmens Vice President, Pittsburgh
Vice President, Chief Accounting Officer Dan Woodward
Hugh Esleeck Vice President, Tampa
Vice President, Treasurer
Ted Klinck
President, Chief Executive Officer
Brian Leary
Executive Vice President, Chief Operating Officer
Carman Liuzzo
Senior Vice President, Investments
Brendan Maiorana
Executive Vice President, Finance and Investor Relations
Art McCann
Vice President, Chief Information Officer
Jeff Miller
Executive Vice President, General Counsel and Secretary
Mark Mulhern
Executive Vice President, Chief Financial Officer
Randy Roberson
Senior Vice President, Development
Mike Starchville
Senior Vice President, Asset Management
Corporate Information
ii
Research Coverage Corporate Headquarters
Highwoods Properties, Inc.
Bank of America/Merrill Lynch Janney Montgomery Scott 3100 Smoketree Court, Suite 600
Jamie Feldman Robert Stevenson Raleigh, NC 27604
646-855-5808 646-840-3217 919-872-4924
BTIG Mizuho Stock Exchange
Tom Catherwood Omotayo Okusanya NYSE: HIW
212-738-6140 (646) 949-9672
Venkat Kommineni Investor Relations
Capital One Securities (646) 949-9754 Brendan Maiorana
Chris Lucas Executive Vice President, Finance and Investor Relations
571-633-8151 Morgan Stanley Phone: 919-872-4924
Vikram Malhotra [email protected]
Citigroup Global Markets 212-761-7064 http://www.highwoods.com/
Michael Bilerman
212-816-1383 RW Baird Information Request
Emmanuel Korchman David Rodgers To request a Supplemental Package or Annual Report
212-816-1382 216-737-7341 or to be added to our e-mail distribution list, please contact
Investor Relations.
D.A. Davidson & Co. SunTrust Robinson Humphrey
Barry Oxford Michael Lewis
212-240-9871 212-319-5659 The Company
Highwoods Properties, headquartered in Raleigh, is a publicly
Green Street Advisors Wells Fargo traded (NYSE:HIW) real estate investment trust (“REIT”) and
Daniel Ismail Blaine Heck a member of the S&P MidCap 400 Index. The Company is a
949-640-8780 443-263-6529 fully-integrated office REIT that owns, develops, acquires, leases and
manages properties primarily in the best business districts (BBDs)
Jefferies & Company, Inc. of Atlanta, Charlotte, Nashville, Orlando, Pittsburgh, Raleigh, Richmond
Peter Abramowitz and Tampa. For more information about Highwoods Properties,
(212) 336-7241 please visit our website at:
Jonathan Petersen www.highwoods.com.
212-284-1705
Corporate Information
iii
9/30/20 9/30/19 9/30/20 6/30/20 3/31/20 12/31/19 9/30/19
Rental and other revenues 556,996$ 543,908$ 181,043$ 183,153$ 192,800$ 192,071$ 187,475$
Operating expenses:
Rental property and other expenses 174,213 185,244 56,892 55,119 62,202 63,267 64,135
Depreciation and amortization 180,914 189,514 60,303 59,461 61,150 64,990 60,850
Impairments of real estate assets 1,778 5,849 - 1,778 - - 5,318
General and administrative 30,169 33,658 9,155 10,084 10,930 10,409 11,717
Total operating expenses 387,074 414,265 126,350 126,442 134,282 138,666 142,020
Interest expense 61,003 59,622 19,886 19,840 21,277 22,026 20,527
Other income/(loss) (2,654) (3,271) (3,311) 588 69 761 174
Gains on disposition of property 163,397 10,218 10,012 318 153,067 29,299 3,515
Equity in earnings of unconsolidated affiliates 2,965 2,369 823 1,179 963 907 940
Net income 272,627 79,337 42,331 38,956 191,340 62,346 29,557 Net (income) attributable to noncontrolling
interests in the Operating Partnership (7,084) (1,974) (1,107) (1,017) (4,960) (1,577) (737) Net (income) attributable to noncontrolling
interests in consolidated affiliates (872) (919) (298) (289) (285) (295) (297)
Dividends on Preferred Stock (1,866) (1,866) (622) (622) (622) (622) (622)
Net income available for common stockholders 262,805$ 74,578$ 40,304$ 37,028$ 185,473$ 59,852$ 27,901$
Earnings per Common Share - basic:Net income available for common stockholders 2.53$ 0.72$ 0.39$ 0.36$ 1.79$ 0.58$ 0.27$
Weighted average Common Shares
outstanding - basic 103,865 103,674 103,896 103,886 103,813 103,746 103,727
Earnings per Common Share - diluted:Net income available for common stockholders 2.53$ 0.72$ 0.39$ 0.36$ 1.79$ 0.58$ 0.27$
Weighted average Common Shares
outstanding - diluted 106,702 106,425 106,740 106,730 106,633 106,504 106,471
Nine Months Ended Three Months Ended
Consolidated Statements of Income (amounts in thousands, except per share amounts)
1
9/30/20 9/30/19 9/30/20 6/30/20 3/31/20 12/31/19 9/30/19
Funds from operations:
Net income 272,627$ 79,337$ 42,331$ 38,956$ 191,340$ 62,346$ 29,557$
Net (income) attributable to noncontrolling
interests in consolidated affiliates (872) (919) (298) (289) (285) (295) (297)
Depreciation and amortization of real estate assets 178,818 187,347 59,622 58,764 60,432 64,198 60,145
Impairments of depreciable properties 1,778 1,400 - 1,778 - - 1,400
(Gains) on disposition of depreciable properties (162,673) (9,283) (10,012) - (152,661) (29,299) (2,580)
Unconsolidated affiliates:
Depreciation and amortization of real estate assets 1,803 1,834 653 581 569 591 632
Funds from operations 291,481 259,716 92,296 99,790 99,395 97,541 88,857
Dividends on Preferred Stock (1,866) (1,866) (622) (622) (622) (622) (622)
Funds from operations available for
common stockholders 289,615$ 257,850$ 91,674$ 99,168$ 98,773$ 96,919$ 88,235$
Funds from operations available for
common stockholders per share 2.71$ 2.42$ 0.86$ 0.93$ 0.93$ 0.91$ 0.83$
Weighted average shares outstanding 106,702 106,425 106,740 106,730 106,633 106,504 106,471
Additional information: 1/
Losses on debt extinguishment 3,671$ 640$ 3,671$ -$ -$ -$ 265$
Straight-line rental income 2/ (33,580) (14,686) (8,135) (15,119) (10,326) (8,280) (6,498) Straight-line rental write-offs related to
termination fees 173 91 41 41 91 145 35
Amortization of lease incentives 1,396 3,848 477 429 490 433 540
Depreciation of non-real estate assets 1,656 1,737 533 551 572 645 555
Ground lease straight-line rent expense 209 237 67 70 72 72 76
Share-based compensation expense 4,980 6,180 1,242 1,242 2,496 1,000 668
Amortization of debt issuance costs 2,312 2,194 779 766 767 776 739
Amortization of accumulated other comprehensive
(income)/loss (222) (841) (74) (74) (74) (74) (212) Amortization of above/(below) market leases and
other adjustments (3,651) 436 (1,203) (1,195) (1,253) (1,135) (1,211)
Non-incremental revenue generating capital expenditures
incurred: 3/
Building improvements (23,290) (23,750) (8,644) (7,295) (7,351) (12,369) (8,566)
2nd generation tenant improvements (60,315) (66,046) (20,847) (18,120) (21,348) (19,090) (19,345)
2nd generation lease commissions (12,709) (19,521) (3,681) (4,274) (4,754) (8,625) (7,553)
Common dividends and unit distributions paid (153,554) (151,556) (51,230) (51,225) (51,099) (50,568) (50,533)
1/ Increase or (decrease) to cash flows.
2/ Includes $0.9 million and $6.0 million of temporary rent deferrals granted by the Company during the three and nine months ended
September 30, 2020, respectively. Includes $1.5 million of credit losses mostly due to the conversion of fixed rent leases to percentage
rent leases for certain customers in the third quarter of 2020.
3/ Excludes capital expenditures (a) incurred within 12 months prior to the disposition date for buildings sold, (b) related to first generation leases and
leases with respect to vacant space in acquired buildings, (c) building improvements that are recoverable from future operating cost savings,
(d) building improvements that constitute part of the total investment cost disclosed in connection with an acquisition and (e) property
re-developments.
Nine Months Ended Three Months Ended
Funds from Operations and Additional Information (amounts in thousands, except per share amounts)
2
9/30/20 12/31/19
Assets:
Real estate assets, at cost:
Land 465,160$ 515,095$
Buildings and tenant improvements 4,948,794 5,128,150
Development in-process 258,219 172,706
Land held for development 131,489 99,163
5,803,662 5,915,114
Less-accumulated depreciation (1,387,723) (1,388,566)
Net real estate assets 4,415,939 4,526,548
Real estate and other assets, net, held for sale 72,729 20,790
Cash and cash equivalents 118,705 9,505
Restricted cash 9,566 5,237
Accounts receivable 25,989 23,370
Mortgages and notes receivable 1,390 1,501
Accrued straight-line rents receivable 253,682 234,652
Investments in and advances to unconsolidated affiliates 26,639 26,298
Deferred leasing costs, net of accumulated amortization of $153,045 and $146,125, respectively 216,329 231,347
Prepaid expenses and other assets, net of accumulated depreciation of $20,557 and $20,017, respectively 63,671 58,996
Total Assets 5,204,639$ 5,138,244$
Liabilities, Noncontrolling Interests in the Operating Partnership and Equity:
Mortgages and notes payable, net 2,469,554$ 2,543,710$
Accounts payable, accrued expenses and other liabilities 299,587 286,911
Total Liabilities 2,769,141 2,830,621
Commitments and contingencies
Noncontrolling interests in the Operating Partnership 95,416 133,216
Equity:
Preferred Stock, $.01 par value, 50,000,000 authorized shares;
8.625% Series A Cumulative Redeemable Preferred Shares (liquidation preference $1,000 per
share), 28,826 and 28,859 shares issued and outstanding, respectively 28,826 28,859
Common Stock, $.01 par value, 200,000,000 authorized shares;
103,908,229 and 103,756,046 shares issued and outstanding, respectively 1,039 1,038
Additional paid-in capital 3,008,501 2,954,779
Distributions in excess of net income available for common stockholders (718,465) (831,808)
Accumulated other comprehensive loss (1,577) (471)
Total Stockholders' Equity 2,318,324 2,152,397
Noncontrolling interests in consolidated affiliates 21,758 22,010
Total Equity 2,340,082 2,174,407
Total Liabilities, Noncontrolling Interests in the Operating Partnership and Equity 5,204,639$ 5,138,244$
Consolidated Balance Sheets (dollars in thousands)
3
9/30/20 6/30/20 3/31/20 12/31/19 9/30/19
Mortgages and notes payable, net, at recorded book
value (see pages 5 & 6) 2,469,554$ 2,337,662$ 2,410,189$ 2,543,710$ 2,322,226$
Preferred Stock, at liquidation value 28,826$ 28,843$ 28,856$ 28,859$ 28,859$
Common Stock outstanding 103,908 103,897 103,886 103,756 103,748
Common Units outstanding (not owned by the Company) 2,842 2,842 2,842 2,724 2,726
Common Stock and Common Units outstanding 106,750 106,739 106,728 106,480 106,474
Per share stock price at period end 33.57$ 37.33$ 35.42$ 48.91$ 44.94$
Market value of Common Stock and Common Units 3,583,598$ 3,984,567$ 3,780,306$ 5,207,937$ 4,784,942$
Total capitalization 6,081,978$ 6,351,072$ 6,219,351$ 7,780,506$ 7,136,027$
Net debt-to-Adjusted EBITDAre:
Net income 42,331$ 38,956$ 191,340$ 62,346$ 29,557$
Interest expense 19,886 19,840 21,277 22,026 20,527
Depreciation and amortization 60,303 59,461 61,150 64,990 60,850
(Gains) on disposition of depreciable properties (10,012) - (152,661) (29,299) (2,580)
Impairments of depreciable properties - 1,778 - - 1,400
Adjustments to reflect our share of EBITDAre from
unconsolidated affiliates 988 916 907 960 1,005
EBITDAre 113,496$ 120,951$ 122,013$ 121,023$ 110,759$
Losses on debt extinguishment 3,671 - - -
(Gains) on disposition of non-depreciable properties - (318) (406) -
Proforma NOI adjustments for property changes within period (104) - (3,343) 1,776
Adjusted EBITDAre 1/ 117,063$ 120,633$ 118,264$ 122,799$
Adjusted EBITDAre (annualized) 1/ 2/ 472,264$ 483,885$ 477,052$ 494,481$ 455,081$
Mortgages and notes payable 3/ 2,497,553$ 2,365,825$ 2,438,248$ 2,572,492$ 2,359,574$
Less - cash and cash equivalents and 1031 restricted cash 3/ (123,040) (8,334) (117,823) (12,305) (120,658)
Net debt 4/ 2,374,513$ 2,357,491$ 2,320,425$ 2,560,187$ 2,238,916$
Preferred Stock 28,826 28,843 28,856 28,859 28,859
Net debt plus Preferred Stock 2,403,339$ 2,386,334$ 2,349,281$ 2,589,046$ 2,267,775$
Net debt-to-Adjusted EBITDAre 5/ 5.03x 4.87x 4.86x 5.18x 4.92x
Net debt plus Preferred Stock-to-Adjusted EBITDAre 6/ 5.09x 4.93x 4.92x 5.24x 4.98x
Rental and other revenues:
Contractual rents, net 152,991$ 148,397$ 157,593$ 159,332$ 154,902$
Straight-line rental income, net 8,135 15,119 10,326 8,280 6,498
Cost recoveries billed under lease arrangements, net 12,994 13,091 16,157 15,508 17,127
Lease termination fees, net 114 178 120 107 111
Other miscellaneous operating revenues 6,809 6,368 8,604 8,844 8,837
181,043$ 183,153$ 192,800$ 192,071$ 187,475$
1/ Adjusted EBITDAre is calculated prospectively for all periods starting 10/1/19 as EBITDAre adjusted for gains or losses on debt extinguishment and land sales, land
impairments, proforma NOI adjustments for property changes within period and our share of the same adjustments for unconsolidated affiliates. "Proforma NOI adjustments
for property changes within period" means proforma NOI adjustments assuming any acquisitions, dispositions and developments placed in service within the current period
had occurred as of the first day of such period. Prior to the quarter ended 12/31/19, Adjusted EBITDAre equals EBITDAre.
2/ Adjusted EBITDAre (annualized) is Adjusted EBITDAre multiplied by four. Certain period specific items are not annualized. In the quarter ended 9/30/19, these included land
impairments and gains and other items.
3/ Includes our share of unconsolidated affiliates.
4/ Net debt is calculated as mortgages and notes payable at quarter-end less cash and cash equivalents and 1031 restricted cash at quarter-end.
5/ Net debt at quarter-end divided by Adjusted EBITDAre (annualized).
6/ Net debt plus Preferred Stock at quarter-end divided by Adjusted EBITDAre (annualized).
Capitalization, Net debt-to-Adjusted EBITDAre and Revenue Detail (dollars, shares and units in thousands)
4
Balances Outstanding: 9/30/20 6/30/20 3/31/20 12/31/19 9/30/19
Secured:
Conventional fixed rate 93,846$ 94,336$ 94,822$ 95,303$ 95,779$
Unsecured - Fixed:
Fixed rate bonds and notes 2,190,241 1,941,277 1,940,851 1,940,425 1,939,999
Bank term loan 1/ 50,000 50,000 50,000 50,000 50,000
Unsecured - fixed total 2,240,241 1,991,277 1,990,851 1,990,425 1,989,999
Unsecured - Floating:
Bank term loan 150,000 200,000 200,000 200,000 200,000
Bank term loan - 50,000 50,000 50,000 50,000
Credit facility 2/ - 14,000 87,000 221,000 -
Unsecured - floating total 150,000 264,000 337,000 471,000 250,000
Unsecured total 2,390,241 2,255,277 2,327,851 2,461,425 2,239,999
Total 2,484,087$ 2,349,613$ 2,422,673$ 2,556,728$ 2,335,778$
Total Net of Debt Issuance Costs 2,469,554$ 2,337,662$ 2,410,189$ 2,543,710$ 2,322,226$
End of Period Weighted Average Interest Rates:
Secured:
Conventional fixed rate 4.00% 4.00% 4.00% 4.00% 4.00%
Unsecured - Fixed:
Fixed rate bonds 3.58% 3.76% 3.76% 3.76% 3.76%
Bank term loan 1/ 2.79% 2.79% 2.79% 2.79% 2.79%
Unsecured - fixed total 3.57% 3.74% 3.74% 3.74% 3.73%
Unsecured - Floating:
Bank term loan 1.25% 1.28% 2.09% 2.90% 3.14%
Bank term loan - 1.28% 2.69% 2.81% 3.21%
Credit facility 2/ - 1.18% 1.87% 2.73% -
Unsecured - floating total 1.25% 1.27% 2.21% 2.81% 3.16%
Unsecured total 3.42% 3.45% 3.50% 3.56% 3.67%
Weighted Average 3.44% 3.47% 3.52% 3.58% 3.68%
Maturity Schedule
1/ The interest rate on this loan is based on one-month LIBOR plus a spread based on the company's credit rating. Swap agreements effectively
fix one-month LIBOR until January 2022.
2/ Maturity date assumes exercise of two six-month extension options.
3/ Excludes annual principal amortization.
Mortgages and Notes Payable Summary (dollars in thousands)
-
50
100
150
200
250
300
350
400
450
500
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
To
tal
Deb
t (i
n m
illio
ns)
Secured Debt 3/ Unsecured Debt
Weighted Average Maturity = 6.9 years
$
5
Undepreciated
Secured Loans Loan Book Value of
Effective Maturity Balance Real Estate & Related
Lender Rate Date 9/30/20 Assets Secured
Allianz Life Insurance Company 4.00% May-29 93,846$ 147,631$
Unsecured Bonds
Bonds 1/ 3.24% Feb-30 399,081
Bonds 2.65% Feb-31 398,384
Bonds 2/ 4.38% Apr-29 349,165
Bonds 3/ 4.06% Mar-28 346,932
Bonds 4/ 3.78% Mar-27 297,434
Bonds 3.75% Jan-23 249,398
Bonds 3.36% Jun-21 149,847
3.58% 2,190,241
Unsecured Loans
Bank term loan 5/ 1.25% Nov-22 150,000
Bank term loan 6/ 2.79% Nov-22 50,000
Credit facility 5/ 7/ - Jan-23 -
1.63% 200,000
Total Debt 3.44% 2,484,087$
Total Net of Debt Issuance Costs 2,469,554$
Secured and Unsecured Debt Fixed and Variable Rate Debt
1/ Rate includes the impact of the swaps that were settled for ($6.6) million upon issuance of the bonds.
2/ Rate includes the impact of the swaps that were settled for ($5.1) million upon issuance of the bonds.
3/ Rate includes the impact of the swaps that were settled for $7.2 million upon issuance of the bonds.
4/ Rate includes the impact of the swaps that were settled for $7.3 million upon issuance of the bonds.
5/ Floating rate loans based on one-month LIBOR.
6/ This loan maturing November 2022 is swapped to an effective fixed rate of 2.79% to January 2022, including the current spread based on the
company's credit rating.
7/ Maturity date assumes exercise of two six-month extension options.
Mortgages and Notes Payable Detail (dollars in thousands)
Secured 3.8%
Unsecured 96.2%
Variable 6.0%
Fixed 94.0%
Bond Covenants as of September 30, 2020
Overall indebtedness (<60%) 40.5%
Secured indebtedness (<40%) 1.5%
Income available for debt service (>1.5x) 5.74x
Total unencumbered assets to unsecured debt (>150%) 249.0%
Agency Rating Outlook Affirmed
S&P BBB Stable 7/13/20
Moody's Baa2 Stable 6/12/20
6
9/30/20 6/30/20 3/31/20 12/31/19 9/30/19
Total In-Service
Rentable Square Feet
Office 26,637,000 26,802,000 26,802,000 27,766,000 27,254,000
Industrial - - - 2,672,000 2,672,000
Total 26,637,000 26,802,000 26,802,000 30,438,000 29,926,000
Occupancy
Office 90.2% 91.1% 90.9% 92.0% 91.2%
Industrial - - - 94.2% 92.9%
Total 90.2% 91.1% 90.9% 92.2% 91.4%
Same Property:
Rentable Square Feet 25,101,000 25,101,000 25,101,000 25,101,000 25,101,000
Occupancy 90.0% 90.9% 90.8% 91.9% 91.1%
Rentable Square Feet and Occupancy Trend: Total In-Service Office Only
Portfolio Summary
85%
87%
89%
91%
93%
95%
20
21
22
23
24
25
26
27
28
29
9/30/19 12/31/19 3/31/20 6/30/20 9/30/20
Occu
pan
cy
Sq
uare
Feet
in M
illio
ns
Rentable Square Feet Occupancy
7
Percentage of
Rentable Annualized
Market Square Feet Occupancy Cash Revenue 1/
Atlanta 5,416,000 88.7% 20.1%
Nashville 4,565,000 92.7% 19.1%
Raleigh 4,875,000 90.8% 18.2%
Tampa 3,619,000 90.3% 13.9%
Pittsburgh 2,151,000 93.6% 8.4%
Orlando 1,791,000 87.7% 6.7%
Richmond 2,037,000 88.6% 6.0%
Charlotte 841,000 89.5% 3.8%
Other 1,342,000 86.6% 3.8%
Total 26,637,000 90.2% 100.0%
Annualized Cash Revenue by Market 1/
1/ Annualized Cash Revenue is September 2020 cash rental revenue (base rent plus operating expense pass through revenue excluding
straight-line rental income) multiplied by 12.
Portfolio Summary
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
Atlanta Nashville Raleigh Tampa Pittsburgh Orlando Richmond Charlotte Other
8
Market Measurement 9/30/20 6/30/20 3/31/20 12/31/19 9/30/19
Atlanta Rentable Square Feet 5,416,000 5,416,000 5,416,000 5,415,000 5,414,000
Occupancy 88.7% 89.1% 88.9% 89.8% 89.7%
Current Properties 1/ 88.7% 89.1% 88.9% 89.8% 89.7%
Charlotte Rentable Square Feet 841,000 841,000 841,000 841,000
Occupancy 89.5% 89.5% 89.5% 89.5%
Current Properties 1/ - - - -
Nashville Rentable Square Feet 4,565,000 4,565,000 4,566,000 4,569,000 4,569,000
Occupancy 92.7% 93.3% 93.4% 94.4% 93.8%
Current Properties 1/ 92.7% 93.3% 93.4% 94.4% 93.8%
Orlando Rentable Square Feet 1,791,000 1,791,000 1,791,000 1,791,000 1,789,000
Occupancy 87.7% 88.3% 88.5% 89.4% 89.8%
Current Properties 1/ 87.7% 88.3% 88.5% 89.4% 89.8%
Pittsburgh Rentable Square Feet 2,151,000 2,148,000 2,148,000 2,148,000 2,148,000
Occupancy 93.6% 93.7% 93.7% 95.3% 96.2%
Current Properties 1/ 93.6% 93.7% 93.7% 95.3% 96.2%
Raleigh Rentable Square Feet 4,875,000 4,875,000 4,874,000 4,874,000 4,874,000
Occupancy 90.8% 90.9% 90.4% 90.1% 88.6%
Current Properties 1/ 90.8% 90.9% 90.4% 90.1% 88.6%
Richmond Rentable Square Feet 2,037,000 2,036,000 2,036,000 2,036,000 2,036,000
Occupancy 88.6% 91.0% 92.2% 93.3% 93.0%
Current Properties 1/ 88.6% 91.0% 92.2% 93.3% 93.0%
Tampa Rentable Square Feet 3,619,000 3,618,000 3,618,000 3,620,000 3,620,000
Occupancy 90.3% 93.4% 91.9% 93.2% 89.7%
Current Properties 1/ 90.3% 93.4% 91.9% 93.2% 89.7%
Other Rentable Square Feet 1,342,000 1,512,000 1,512,000 5,144,000 5,476,000
Occupancy 86.6% 86.9% 86.8% 93.5% 92.6%
Current Properties 1/ 86.6% 86.9% 86.8% 92.5% 92.4%
Total Rentable Square Feet 26,637,000 26,802,000 26,802,000 30,438,000 29,926,000
Occupancy 90.2% 91.1% 90.9% 92.2% 91.4%
Current Properties 1/ 90.2% 91.1% 90.8% 91.9% 91.2%
1/ Only includes properties that were owned and in-service for all periods shown.
Occupancy Trends
9
Leasing Statistics
Three Months Ended Five Quarter
9/30/20 6/30/20 3/31/20 12/31/19 9/30/19 Average
Leasing Activity:
Square footage of Renewal Deals 469,877 730,250 718,127 805,197 571,779 659,046
Square footage of New Deals (Relets) 189,826 91,007 174,685 397,703 366,923 244,029
Rentable square footage leased 659,703 821,257 892,812 1,202,900 938,702 903,075
Renewed square footage (% of total) 71.2% 88.9% 80.4% 66.9% 60.9% 73.0%
New Leases square footage (% of total) 28.8% 11.1% 19.6% 33.1% 39.1% 27.0%
Number of lease transactions (signed leases) 93 92 87 107 97 95
Weighted average per rentable square foot
over the lease term:
Base rent 30.62$ 29.73$ 27.96$ 32.68$ 29.46$ 30.09$
Rent concessions (1.18) (0.88) (0.84) (0.54) (0.61) (0.81)
GAAP rent 29.44 28.85 27.12 32.14 28.85 29.28
Tenant improvements (2.04) (1.48) (2.08) (3.20) (3.61) (2.48)
Leasing commissions 1/ (0.62) (0.67) (0.81) (1.06) (0.86) (0.80)
Effective rent after capex 26.78 26.70 24.23 27.88 24.38 26.00
Expense stop (8.81) (8.90) (8.36) (9.71) (9.08) (8.97)
Effective rent after capex and opex 17.97$ 17.80$ 15.87$ 18.17$ 15.30$ 17.03$
Square feet weighted average term in years 5.1 8.2 4.2 6.0 6.5 6.0
Dollar weighted average term in years 5.3 8.8 4.4 6.1 6.7 6.3
Capital Expenditures Related to Above Leasing Activity:
Tenant Improvements:
Total dollars committed under signed leases 9,068,065$ 10,272,768$ 10,419,237$ 27,061,715$ 24,182,708$ 16,200,899$
Rentable square feet 659,703 821,257 892,812 1,202,900 938,702 903,075
Per rentable square foot 13.75$ 12.51$ 11.67$ 22.50$ 25.76$ 17.94$
Leasing Commissions:
Total dollars committed under signed leases 1/ 1,932,360$ 3,719,672$ 3,218,804$ 8,258,867$ 5,526,859$ 4,531,312$
Rentable square feet 659,703 821,257 892,812 1,202,900 938,702 903,075
Per rentable square foot 2.93$ 4.53$ 3.61$ 6.87$ 5.89$ 5.02$
Total:
Total dollars committed under signed leases 11,000,425$ 13,992,440$ 13,638,041$ 35,320,582$ 29,709,567$ 20,732,211$
Rentable square feet 659,703 821,257 892,812 1,202,900 938,702 903,075
Per rentable square foot 16.67$ 17.04$ 15.28$ 29.36$ 31.65$ 22.96$
1/ Excludes capitalized internal leasing costs.
Office Leasing Statistics
10
For Three Months Ended September 30, 2020
Leasing Statistics Rentable Lease
Square Feet Average TI's Commissions Rental Previous Percentage
Leased Term Per SF Per SF Rate Rent Change
Atlanta 173,856 6.7 6.56$ 0.95$ 32.74$ 29.36$ 11.5%
Raleigh 167,113 3.0 7.87 1.32 25.20 24.07 4.7%
Tampa 79,486 5.1 16.96 5.69 32.72 28.25 15.8%
Orlando 76,624 5.7 22.48 2.79 32.06 21.97 45.9%
Nashville 71,937 5.1 19.14 4.00 28.92 27.80 4.0%
Richmond 26,059 5.5 19.79 4.51 22.16 24.65 -10.1%
Pittsburgh 10,000 7.4 25.00 7.51 30.41 - -
Charlotte 5,124 5.3 91.21 11.90 37.20 - -
Other 49,504 5.3 18.84 6.84 26.87 24.95 7.7%
GAAP Rent Growth 1/ 659,703 5.3 13.75$ 2.93$ 29.44$ 26.17$ 12.5%
Cash Rent Growth 2/ 659,703 5.3 13.75$ 2.93$ 29.94$ 28.52$ 5.0%
Average Office Cash Rental Rates for All In-Place Leases as of:
1/ GAAP rent growth is calculated by comparing average cash rent psf over the term (GAAP rent) of the new lease to the average cash rent psf
over the term related to the previous lease in the same space. Adjustments are made if necessary to put both the current and prior deal on a
consistent gross lease basis.
2/ Cash rent growth is calculated by comparing beginning annualized cash rent psf (after rent concessions burn off) under the new lease to ending
annualized cash rent psf (including recovery income and rent escalations) related to the previous lease in the same space. Adjustments are
made if necessary to put both the current and prior deal on a consistent gross lease basis.
Office Leasing Statistics and Rental Rate Comparisons by Market
$24.22 $24.53
$25.74
$26.67
$28.07
$19
$20
$21
$22
$23
$24
$25
$26
$27
$28
$29
9/30/16 9/30/17 9/30/18 9/30/19 9/30/20
11
Occupied Percent of Percent of
Rentable Occupied Annualized Average Annualized
Square Feet Rentable Cash Rental Cash
Year Expiring Square Feet Revenue 1/ Rate Revenue 1/
2020 2/ 340,754 1.4% 9,208$ 27.02$ 1.4%
2021 2,063,611 8.6% 57,316 27.77 8.5%
2022 1,924,128 8.0% 55,007 28.59 8.2%
2023 2,415,645 10.1% 65,929 27.29 9.8%
2024 2,558,175 10.6% 74,306 29.05 11.0%
2025 2,931,878 12.2% 82,012 27.97 12.2%
2026 1,813,231 7.5% 51,984 28.67 7.7%
2027 1,801,773 7.5% 49,472 27.46 7.3%
2028 1,485,175 6.2% 36,657 24.68 5.4%
2029 1,169,975 4.9% 33,286 28.45 4.9%
2030 and thereafter 5,527,372 23.0% 159,288 28.82 23.6%
24,031,717 100.0% 674,465$ 28.07$ 100.0%
Percent of Total Annualized Cash Revenue Expiring by Year
1/ Annualized Cash Revenue is September 2020 cash rental revenue (base rent plus operating expense pass through revenue excluding straight-line
rental income) multiplied by 12.
2/ Includes 31,000 square feet of leases that are on a month to month basis, which constitute 0.2% of total annualized revenue.
Note: 2020 and beyond expirations that have been renewed are reflected above based on the renewal expiration date. Expirations include leases
related to completed not stabilized development properties and exclude leases related to developments in-process.
Office Lease Expirations (dollars in thousands)
0%2%4%6%8%
10%12%14%16%18%20%22%24%
2020 2/ 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 andthereafter
12
2020 1/ 2021 2022 2023 Thereafter
Atlanta RSF 77,036 419,251 252,415 253,455 3,799,494
% of Total RSF 0.4% 1.7% 1.0% 1.1% 15.9%
Annualized Cash Revenue 2/ 1,694$ 12,187$ 8,822$ 7,697$ 105,639$
% of Total Annl Cash Rev 0.3% 1.8% 1.4% 1.2% 15.5%
Charlotte RSF 0 0 0 0 752,921
% of Total RSF 0.0% 0.0% 0.0% 0.0% 3.1%
Annualized Cash Revenue 2/ 12$ -$ 361$ -$ 25,271$
% of Total Annl Cash Rev 0.0% 0.0% 0.1% 0.0% 3.7%
Nashville RSF 30,755 228,833 163,894 438,677 3,367,921
% of Total RSF 0.1% 1.0% 0.7% 1.8% 14.0%
Annualized Cash Revenue 2/ 766$ 6,270$ 4,729$ 12,731$ 104,011$
% of Total Annl Cash Rev 0.1% 0.9% 0.7% 1.9% 15.4%
Orlando RSF 25,281 246,924 205,911 147,591 945,325
% of Total RSF 0.1% 1.0% 0.9% 0.6% 4.0%
Annualized Cash Revenue 2/ 779$ 7,109$ 6,354$ 4,565$ 26,423$
% of Total Annl Cash Rev 0.1% 1.1% 0.9% 0.7% 3.9%
Pittsburgh RSF 0 77,022 138,936 189,918 1,608,402
% of Total RSF 0.0% 0.3% 0.6% 0.8% 6.7%
Annualized Cash Revenue 2/ 26$ 2,189$ 4,024$ 5,718$ 44,429$
% of Total Annl Cash Rev 0.0% 0.3% 0.6% 0.8% 6.6%
Raleigh RSF 57,314 385,606 355,018 364,712 3,264,713
% of Total RSF 0.2% 1.6% 1.4% 1.5% 13.6%
Annualized Cash Revenue 2/ 1,479$ 10,652$ 9,585$ 9,434$ 91,443$
% of Total Annl Cash Rev 0.2% 1.6% 1.4% 1.4% 13.5%
Richmond RSF 29,514 230,805 235,577 329,481 979,909
% of Total RSF 0.1% 1.0% 1.0% 1.4% 4.0%
Annualized Cash Revenue 2/ 597$ 5,470$ 5,447$ 7,512$ 21,189$
% of Total Annl Cash Rev 0.1% 0.8% 0.8% 1.1% 3.1%
Tampa RSF 32,106 282,815 427,275 436,740 2,088,418
% of Total RSF 0.1% 1.2% 1.8% 1.8% 8.7%
Annualized Cash Revenue 2/ 1,720$ 8,238$ 12,228$ 13,412$ 58,320$
% of Total Annl Cash Rev 0.3% 1.2% 1.8% 2.0% 8.8%
Other RSF 88,748 192,355 145,102 255,071 480,476
% of Total RSF 0.4% 0.8% 0.6% 1.1% 1.9%
Annualized Cash Revenue 2/ 2,135$ 5,201$ 3,457$ 4,860$ 10,280$
% of Total Annl Cash Rev 0.3% 0.8% 0.5% 0.7% 1.6%
Total RSF 340,754 2,063,611 1,924,128 2,415,645 17,287,579
% of Total RSF 1.4% 8.6% 8.0% 10.1% 71.9%
Annualized Cash Revenue 2/ 9,208$ 57,316$ 55,007$ 65,929$ 487,005$
% of Total Annl Cash Rev 1.4% 8.5% 8.2% 9.8% 72.1%
1/ Includes 31,000 square feet of leases that are on a month to month basis, which constitute 0.2% of total annualized revenue.
2/ Annualized Cash Revenue is September 2020 cash rental revenue (base rent plus operating expense pass through revenue excluding
straight-line rental income) multiplied by 12.
Office Lease Expirations by Market by Year (dollars in thousands)
13
Percent of Average
Rentable Annualized Annualized Remaining
Square Cash Cash Lease
Top 20 Customers Feet Revenue 1/ Revenue 1/ Term in Years
Federal Government 1,222,764 32,439$ 4.81% 8.1
Bank of America 652,313 26,198 3.88% 13.4
Bridgestone Americas 506,128 18,195 2.70% 16.9
Metropolitan Life Insurance 624,540 16,719 2.48% 10.6
Mars Petcare 223,700 9,850 1.46% 10.7
PPG Industries 361,215 9,837 1.46% 10.6
EQT Corporation 317,052 8,265 1.23% 4.0
Vanderbilt University 294,389 8,251 1.22% 5.6
Tivity 263,598 7,717 1.14% 2.4
Bass, Berry & Sims 213,951 7,167 1.06% 4.3
American General Life 173,834 6,335 0.94% 6.3
Novelis 168,949 6,267 0.93% 3.9
State of Georgia 288,443 5,764 0.85% 3.8
Lifepoint Corporate Services 202,991 5,545 0.82% 8.5
PNC Bank 159,142 5,037 0.75% 7.3
Delta Community Credit Union 128,589 4,885 0.72% 12.1
Avanos Medical 193,199 4,713 0.70% 8.5
Marsh USA 136,246 4,667 0.69% 6.9
Willis Towers Watson 162,849 4,564 0.68% 3.5
Global Payments 168,051 4,537 0.67% 12.4
6,461,943 196,952$ 29.19% 9.2
Percent of Annualized Revenue by Industry
Percent of
Annualized
Cash
Category Revenue 1/
Professional, Scientific, and Technical Services 25.0%
Finance/Banking 17.5%
Health Care and Social Assistance 11.8%
Insurance 9.6%
Manufacturing 7.8%
Government/Public Administration 6.0%
Real Estate Rental and Leasing 4.6%
Information 3.5%
Administrative and Support Services 2.5%
Retail Trade 2.0%
Other Services (except Public Administration) 1.9%
Educational Services 1.8%
Accommodation and Food Services 1.6%
Telecommunication 1.5%
Energy 1.5%
Transportation and Warehousing 1.0%
Wholesale Trade 0.4%
100.0%
1/ Annualized Cash Revenue is September 2020 cash rental revenue (base rent plus operating expense pass through revenue excluding
straight-line rental income) multiplied by 12.
Customer Diversification (dollars in thousands)
14
Three months ended
September 30, Dollar Percentage
2020 2019 Change B/(W) Change B/(W)
Rental revenues 1/ 157,885$ 160,724$ (2,839)$ (1.8%)
Operating expenses (52,843) (57,988) 5,145 8.9%
Cash NOI excluding temporary rent deferrals 1/ 105,042 102,736 2,306 2.2%
Temporary rent deferrals 2/ (1,012) - (1,012) -
Cash NOI 104,030 102,736 1,294 1.3%
Lease termination fees 3/ 114 111 3 2.7%
Cash NOI with Term Fees 4/ 104,144 102,847 1,297 1.3%
Straight-line rent and other non-cash adjustments 5/ 6,195 6,548 (353) (5.4%)
GAAP NOI 110,339$ 109,395$ 944$ 0.9%
Average occupancy 90.4% 91.0% (0.6%)
Rentable square feet 25,101,000 25,101,000
Nine months ended
September 30, Dollar Percentage
2020 2019 Change B/(W) Change B/(W)
Rental revenues 1/ 476,609$ 475,439$ 1,170$ 0.2%
Operating expenses (159,690) (167,484) 7,794 4.7%
Cash NOI excluding temporary rent deferrals 1/ 316,919 307,955 8,964 2.9%
Temporary rent deferrals 2/ (5,517) - (5,517) -
Cash NOI 311,402 307,955 3,447 1.1%
Lease termination fees 3/ 412 557 (145) (26.0%)
Cash NOI with Term Fees 4/ 311,814 308,512 3,302 1.1%
Straight-line rent and other non-cash adjustments 5/ 25,624 12,358 13,266 107.3%
GAAP NOI 337,438$ 320,870$ 16,568$ 5.2%
Average occupancy 90.7% 91.0% (0.3%)
Rentable square feet 25,101,000 25,101,000
Year to Date: 2020 vs 2019
GAAP NOI Occupancy
Percentage Percentage
Market Change Change
Atlanta (1.4%) 0.1%
Nashville 1.1% (0.3%)
Orlando (7.0%) (1.5%)
Pittsburgh (0.9%) (1.1%)
Raleigh 6.8% 1.8%
Richmond (0.2%) (2.7%)
Tampa 43.0% 1.5%
Other (7.6%) (6.3%)
5.2% (0.3%)
1/ Excludes straight-line rents, lease termination fees, adjustments related to amortization of acquired above and below market leases and amortization
of lease incentives.
2/ Includes impact of temporary rent deferrals, the majority of which are scheduled to be repaid by the end of 2021. Rent deferrals do not include
abatements or free rent provided in exchange for lease extensions entered into as a result of the COVID-19 pandemic.
3/ Straight-line rent credit losses related to lease terminations are reflected here as a reduction of lease termination fees.
4/ Excludes straight-line rents, adjustments related to amortization of acquired above and below market leases and amortization of lease incentives.
5/ Includes adjustments related to amortization of acquired above and below market leases, amortization of lease incentives and temporary rent
deferrals. Includes $1.5 million of credit losses mostly due to the conversion of fixed rent leases to percentage rent leases for certain customers
in the third quarter of 2020.
Same Property Performance (dollars in thousands)
15
Nine Months
Ended
9/30/20
Occupancy 93.6%
Square feet 3,801,000
Gross sales price 361,700$
Industrial/Flex Portfolio
Market Greensboro
Property type Industrial/Flex
Number of buildings 35
Date sold January 30, 2020
Occupancy 1/ 93.9%
Square feet 2,783,000
Gross sales price 193,400$
The Knollwood
Market Greensboro
Property type Office
Number of buildings 2
Date sold February 12, 2020
Occupancy 1/ 95.2%
Square feet 250,000
Gross sales price 40,000$
Triad Centre
Market Memphis
Property type Office
Number of buildings 3
Date sold March 31, 2020
Occupancy 1/ 93.9%
Square feet 387,000
Gross sales price 60,000$
International Place II
Market Memphis
Property type Office
Number of buildings 1
Date sold March 31, 2020
Occupancy 1/ 91.4%
Square feet 212,000
Gross sales price 45,000$
Centrum and Colonnade
Market Memphis
Property type Office
Number of buildings 2
Date sold July 1, 2020
Occupancy 1/ 89.0%
Square feet 169,000
Gross sales price 23,300$
1/ As of last reported quarter-end occupancy prior to date of disposition.
Disposition Activity (dollars In thousands)
16
Rentable Anticipated Investment Estimated Estimated
Square Total As Of Pre Completion Stabilization
Office In-Process Market Feet Investment 1/ 9/30/20 1/ Leased % Date Date
GlenLake Seven 2/ Raleigh 125,700 43,881$ 31,492$ 100.0% 1Q 21 1Q 21
Virginia Springs II Nashville 111,000 37,900 24,072 5.3% 4Q 20 3Q 22
Midtown West 3/ Tampa 150,000 71,300 42,015 6.6% 2Q 21 4Q 22
Asurion Nashville 552,800 285,000 205,089 98.3% 4Q 21 1Q 22
939,500 438,081$ 302,668$ 72.9%
Occupancy
Office Completed Not Stabilized 4/ as of 9/30/20
MetLife III 5/ Raleigh 219,000 64,500$ 62,646$ 100.0% 86.4% 1Q 19 2Q 21
219,000 64,500$ 62,646$ 100.0% 86.4%
Total Pipeline 1,158,500 502,581$ 365,314$ 78.0%
$ Weighted % 78.6%
Asurion HQ, Nashville
1/ Includes deferred lease commissions, which are not classified as development in-process on our consolidated balance sheet.
2/ Recorded on our consolidated balance sheet in land and buildings and tenant improvements, not development in-process.
3/ We own an 80% interest in this consolidated joint venture.
4/ "Completed not stabilized" properties are recorded on our consolidated balance sheet in land and buildings and tenant improvements,
not development in-process.
5/ Pre-lease of 100% contains a required take down of one floor in Q2 '21.
Development Activity (dollars in thousands)
17
Acres
As Of Square Footage
Market 9/30/20 Buildout 1/Nashville 58 1,934,000 Tampa 37 813,000 Raleigh 32 1,093,000 Richmond 2/ 23 350,000 Orlando 2 451,000 Atlanta 1 175,000 Pittsburgh 3/ - 58,000
Core total 153 4,874,000
Non-core total 59
Total 212
Cost Basis 1/ 2/ 3/ 128,128$
The 212 acres of Development Land have an estimated market value of between $140M to $150M.
1/ Represents approximately $1.9 billion in total development.
2/ Excludes 10 acres of core development land and 3 acres of non-core land owned by a 50% consolidated joint venture
with a total cost basis of $1.9 million and $1.5 million, respectively.
3/ Total acreage is less than an acre.
Land Held for Development (dollars in thousands)
18
Unconsolidated Joint Venture Financial Information:
Joint Venture Own % Revenue NOI Revenue NOI
Plaza Colonnade, Tenant-in-Common 50.0% 3,275$ 2,060$ 9,974$ 6,629$
Highwoods DLF Forum, LLC 25.0% 3,754 2,684 11,635 8,420
Kessinger/Hunter & Company, LC 26.5% 1,287 170 3,683 581
Total 8,316$ 4,914$ 25,292$ 15,630$
Total Total
Joint Venture Own % Assets Debt Liabilities
Plaza Colonnade, Tenant-in-Common 50.0% 55,561$ 55,464$ 59,062$
Highwoods DLF Forum, LLC 25.0% 108,738 - 5,156
Kessinger/Hunter & Company, LC 26.5% 4,240 1,007 2,264
Total 168,539$ 56,471$ 66,482$
Summary of Joint Ventures:Percentage of
Joint Venture
Annualized
Rentable Cash
Market Square Feet Occupancy Revenue 1/ 2/
Kansas City 292,000 98.7% 47.1%
Raleigh 636,000 91.0% 29.9%
Richmond 3/ 345,000 99.2% 23.0%
Total 1,273,000 95.0% 100.0%
1/ Annualized Cash Revenue is September 2020 cash rental revenue (base rent plus operating expense pass through revenue excluding
straight-line rental income) multiplied by 12.
2/ Annualized Cash Revenue is based on Highwoods' share only.
3/ This joint venture is consolidated.
Venture's Books
Three Months Ended September 30, 2020 Nine Months Ended September 30, 2020
Venture's Books
As of September 30, 2020
Unconsolidated Joint Ventures Income Year Ended 12/31/14 (dollars in thousands)Unconsolidated Joint Ventures Income Six Months Ended Joint Venture Financial and Summary Information (dollars in thousands)
19