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BioMed Realty Trust Reports Third Quarter 2008 Financial Results

SAN DIEGO, Oct. 29 /PRNewswire-FirstCall/ -- BioMed Realty Trust, Inc. (NYSE: BMR), a real estate investment trust focused on providing real estate to the life science industry, today announced financial results for the third quarter ended September 30, 2008.

    Highlights:

    -- Quarterly total revenues increased 24.6% to $80.8 million from
       $64.8 million in the third quarter 2007

    -- Completed delivery of the 84,000 square foot build-to-suit laboratory
       and office facility at our Towne Centre Drive campus in San Diego to
       our tenant, Illumina, Inc.

    -- Continued delivery of space to Beth Israel Deaconess Medical Center,
       Inc. at the Center for Life Science | Boston, bringing total occupancy
       at the building to nearly 80% at the end of the quarter

    -- Executed leasing transactions during the quarter representing nearly
       200,000 square feet:

        o Six new leases totaling approximately 52,000 square feet, including
          an approximately 28,000 square foot lease with Nteryx, Inc. at our
          Ardenwood Boulevard property in the Fremont/Newark submarket of the
          San Francisco Bay Area

        o Seven leases amended to extend their terms totaling approximately
          147,000 square feet, including a 15-year extension on approximately
          91,000 square feet leased to Regeneron Pharmaceuticals, Inc.,
          expanding Regeneron's long-term commitment at our Landmark at
          Eastview property in New York to over 348,000 square feet

    -- Funds from operations (FFO) for the quarter increased 15.5% from the
       third quarter 2007 to $35.6 million, or $0.48 per diluted share

"Our continued successes on the operating front, combined with our conservative approach to our capital structure, have enabled us to maintain our focus throughout these extremely turbulent, challenging times, and position us well to take advantage of the opportunities we see in our business. We remain confident in the fundamental long-term demand drivers for the life science industry, and in turn for life science real estate," commented Alan D. Gold, President and Chief Executive Officer of BioMed Realty Trust.

Third Quarter 2008 Financial Results

Rental revenues for the quarter were $59.4 million, representing a 20.2% increase versus the third quarter of 2007. Same property net operating income increased 7.3% on a cash basis for the third quarter of 2008 compared to the third quarter of 2007.

Total revenues for the quarter were $80.8 million, compared to $64.8 million in the third quarter of 2007. Net income available to common stockholders for the quarter was $13.0 million, or $0.18 per diluted share, compared to $12.2 million, or $0.19 per diluted share, in the third quarter of 2007.

FFO during the quarter was $35.6 million, representing a 15.5% increase versus the third quarter of 2007. FFO per diluted share was $0.48 for the third quarter of 2008 versus $0.45 in the third quarter of 2007.

FFO is a supplemental non-GAAP financial measure used in the real estate industry to measure and compare the operating performance of real estate companies. A complete reconciliation containing adjustments from GAAP net income available to common stockholders to FFO and a definition of FFO are included at the end of this release.

Financing Activity

As of September 30, 2008, the company's consolidated debt included fixed-rate mortgage indebtedness with an aggregate outstanding principal amount of $354.8 million, including $9.3 million of debt premium, and a weighted-average effective interest rate of 5.5% at quarter-end; the company's $250 million secured term loan, with a weighted-average effective interest rate of 4.1% at quarter-end; $175 million aggregate principal amount of 4.50% exchangeable senior notes due 2026; $266.7 million in outstanding borrowings under the company's $600 million unsecured revolving line of credit, with a weighted-average effective interest rate of 3.8% at quarter-end; and $501.0 million in outstanding borrowings under the company's acquisition and construction loan secured by the Center for Life Science | Boston property, with a weighted-average effective interest rate of 4.4% at quarter-end. The company's debt to total capitalization ratio was 41.0% at September 30, 2008.

After the quarter ended, on October 6, 2008, the company completed the sale of 8,625,000 shares of common stock, raising net proceeds of approximately $212.4 million after deducting underwriter discounts and commissions and estimated expenses. The net proceeds were utilized to repay a portion of the outstanding borrowings on our $600 million unsecured line of credit and for other general corporate and working capital purposes.

"We have maintained our consistently conservative approach to managing our balance sheet and we were pleased to be able to further fortify our balance sheet through our October 2008 common stock offering. We appreciate the consistent support we have received from our shareholders and lenders," commented Kent Griffin, Chief Financial Officer of BioMed Realty Trust.

Portfolio Update

As of September 30, 2008, BioMed Realty Trust owned or had interests in 112 buildings, located predominantly in the major U.S. life science markets of Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania and New York/New Jersey. The company's portfolio was comprised of the following, with its operating portfolio 89.0% leased to 115 tenants, as of September 30, 2008:



                                                                 Rentable
                                                                Square Feet
    Operating portfolio                                          7,304,971
    Repositioning and redevelopment properties                   1,676,651
    Construction in progress                                     1,437,000
      Total portfolio                                           10,418,622

    Land parcels                                                 1,367,000
      Total proforma portfolio                                  11,785,622


Following the end of the quarter, on October 3, 2008, a portion of the parking spaces at the garage located on the company's Center for Life Science | Boston property were sold for approximately $29.0 million pursuant to an agreement assumed by the company in connection with its acquisition of the property in November 2006.

On October 14, 2008, the company acquired the minority interest in the entity that owns the 530 Fairview Avenue property in Seattle for approximately $2.6 million; as a result, the company owns 100% of the property.

Quarterly Distributions

BioMed Realty Trust's board of directors previously declared a third quarter 2008 dividend of $0.335 per share of common stock, and a dividend of $0.46094 per share of the company's 7.375% Series A Cumulative Redeemable Preferred Stock for the period from July 16, 2008 through October 15, 2008.

Earnings Guidance

Having reported results for the first nine months of 2008, the company has narrowed its 2008 earnings guidance. The company has also adjusted its earnings guidance to reflect the impact of the October 2008 common stock offering. The company's revised 2008 guidance for net income per diluted share and FFO per diluted share is set forth and reconciled below.



                                                                   2008
                                                               (Low - High)
    Projected net income per diluted share available
     to common stockholders                                    $0.71 - 0.74
        Add:
      Minority interest in operating partnership                  $0.03
      Real estate depreciation and amortization                   $1.10
      Projected FFO per diluted share                         $1.84 - $1.87


The company's initial 2009 guidance for net income per diluted share and FFO per diluted share is set forth and reconciled below.



                                                                   2009
                                                               (Low - High)
    Projected net income per diluted share available
     to common stockholders                                    $0.54 - 0.74
        Add:
      Minority interest                                           $0.02
      Real estate depreciation and amortization                   $1.04
      Projected FFO per diluted share                          $1.60 - $1.80


Consistent with the 2008 guidance, the company's 2009 guidance does not include the impact of future acquisition activities. In addition, the company's 2009 guidance includes the estimated impact of the change in accounting for its exchangeable senior notes, the company's October 2008 common stock offering and higher anticipated financing costs.

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, financing transactions, interest rates, and the amount and timing of development and redevelopment activities. The company's actual results may differ materially from these estimates.

Supplemental Information

Supplemental operating and financial data are available in the Investor Relations section of the company's web site at http://www.biomedrealty.com.

Teleconference and Web Cast

BioMed Realty Trust will conduct a conference call and audio web cast at 10:00 a.m. Pacific Time (1:00 p.m. Eastern Time) on Thursday, October 30, 2008 to discuss the company's financial results and operations for the quarter. The call will be open to all interested investors either through a live audio web cast at the Investor Relations section of the company's web site at http://www.biomedrealty.com and http://www.earnings.com, or live by calling (866) 314-5050 (domestic) or (617) 213-8051 (international) with call ID number 52610625. The call will be archived for 30 days on both web sites. A telephone playback of the conference call will also be available from 2:00 p.m. Pacific Time on Thursday, October 30, 2008 through midnight Pacific Time on Tuesday, November 4, 2008 by calling (888) 286-8010 (domestic) or (617) 801-6888 (international) and using access code 61247789.

About BioMed Realty Trust

BioMed Realty Trust, Inc. is a real estate investment trust (REIT) focused on Providing Real Estate to the Life Science Industry(R). The company's tenants primarily include biotechnology and pharmaceutical companies, scientific research institutions, government agencies and other entities involved in the life science industry. BioMed Realty Trust owns or has interests in 69 properties, representing 112 buildings with approximately 10.4 million rentable square feet, including approximately 1.4 million square feet of development in progress. The company also owns undeveloped land parcels adjacent to existing properties that it estimates can support up to 1.4 million rentable square feet. The company's properties are located predominantly in the major U.S. life science markets of Boston, San Diego, San Francisco, Seattle, Maryland, Pennsylvania and New York/New Jersey, which have well-established reputations as centers for scientific research. Additional information is available at http://www.biomedrealty.com.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, without limitation: general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, dependence on tenants' financial condition, and competition from other developers, owners and operators of real estate); adverse economic or real estate developments in the life science industry or the company's target markets; risks associated with the availability and terms of financing and the use of debt to fund acquisitions and developments; failure to manage effectively the company's growth and expansion into new markets, or to complete or integrate acquisitions and developments successfully; risks and uncertainties affecting property development and construction; risks associated with downturns in the national and local economies, increases in interest rates, and volatility in the securities markets; potential liability for uninsured losses and environmental contamination; risks associated with the company's potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended, and possible adverse changes in tax and environmental laws; and risks associated with the company's dependence on key personnel whose continued service is not guaranteed. For a further list and description of such risks and uncertainties, see the reports filed by the company with the Securities and Exchange Commission, including the company's most recent annual report on Form 10-K and quarterly reports on Form 10-Q. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

                          (Financial Tables Follow)



                          BIOMED REALTY TRUST, INC.
                         CONSOLIDATED BALANCE SHEETS
                                (In thousands)

                                       September 30, 2008   December 31, 2007
                                           (Unaudited)
                       ASSETS
    Investments in real estate, net        $2,915,675          $2,805,983
    Investments in unconsolidated
     partnerships                              20,296              22,588
    Cash and cash equivalents                  23,451              13,479
    Restricted cash                             8,291               8,867
    Accounts receivable, net                    7,284               4,457
    Accrued straight-line rents, net           52,721              36,415
    Acquired above-market leases, net           4,661               5,745
    Deferred leasing costs, net               107,145             116,491
    Deferred loan costs, net                   12,057              15,567
    Other assets                               70,837              27,676
        Total assets                       $3,222,418          $3,057,268

              LIABILITIES AND STOCKHOLDERS' EQUITY
    Mortgage notes payable, net              $354,828            $379,680
    Secured construction loan                 500,998             425,160
    Secured term loan                         250,000             250,000
    Exchangeable senior notes                 175,000             175,000
    Unsecured line of credit                  266,660             270,947
    Security deposits                           7,469               7,090
    Dividends and distributions payable        29,441              25,596
    Accounts payable, accrued expenses,
     and other liabilities                    106,553              95,871
    Acquired below-market leases, net          19,212              23,708
      Total liabilities                     1,710,161           1,653,052
    Minority interests                         14,968              17,280
    Stockholders' equity:
      Preferred stock                         222,413             222,413
      Common stock                                717                 656
    Additional paid-in capital              1,432,350           1,277,770
    Accumulated other comprehensive loss      (35,657)            (21,762)
    Dividends in excess of earnings          (122,534)            (92,141)
      Total stockholders' equity            1,497,289           1,386,936
        Total liabilities and
         stockholders' equity              $3,222,418          $3,057,268



                          BIOMED REALTY TRUST, INC.
                      CONSOLIDATED STATEMENTS OF INCOME
               (In thousands, except share and per share data)

                               For the Three Months    For the Nine Months
                                Ended September 30,    Ended September 30,
                                2008        2007         2008       2007
                                  (Unaudited)              (Unaudited)
    Revenues:
      Rental                   $59,381     $49,382    $163,946    $146,351
      Tenant recoveries         20,911      15,084      53,297      47,264
      Other income                 519         366       1,697       8,445
        Total revenues          80,811      64,832     218,940     202,060
    Expenses:
      Rental operations         17,027      12,789      44,345      38,784
      Real estate taxes          6,763       5,079      16,948      16,538
      Depreciation and
       amortization             21,506      17,665      58,525      54,556
      General and
       administrative            4,589       5,283      16,428      15,990
        Total expenses          49,885      40,816     136,246     125,868
        Income from
         operations             30,926      24,016      82,694      76,192
      Equity in net loss
       of unconsolidated
       partnerships               (208)       (261)       (338)       (694)
      Interest income              110         239         370         809
      Interest expense         (13,035)     (7,043)    (28,600)    (21,013)
          Income from
           continuing
           operations
           before minority
           interests            17,793      16,951      54,126      55,294
      Minority interests
       in continuing
       operations of
       consolidated
       partnerships                (11)         51          (4)        (61)
      Minority interests in
       continuing
       operations of
       operating
       partnership                (559)       (545)     (1,767)     (1,821)
          Income from
           continuing
           operations           17,223      16,457      52,355      53,412
      Income from
       discontinued
       operations before
       (loss)/gain on sale
       of assets and
       minority interests            -           -           -         639
      (Loss)/gain on sale
       of real estate assets         -          (1)          -       1,087
      Minority interests
       attributable to
       discontinued
       operations                    -           -           -         (74)
          (Loss)/income
           from
           discontinued
           operations                -          (1)          -       1,652
          Net income            17,223      16,456      52,355      55,064
      Preferred stock
       dividends                (4,241)     (4,241)    (12,722)    (12,628)
          Net income
           available to
           common
           stockholders        $12,982     $12,215     $39,633     $42,436
    Income from
     continuing operations
     per share available
     to common
     stockholders:
      Basic and diluted
       earnings per share        $0.18       $0.19       $0.57       $0.62

    Net income per share
     available to common
     stockholders:
      Basic and diluted
       earnings per share        $0.18       $0.19       $0.57       $0.65

    Weighted-average
     common shares
     outstanding:
      Basic                 71,513,333  65,308,702  68,995,015  65,300,802
      Diluted               74,714,841  68,274,908  72,120,329  68,262,086



                          BIOMED REALTY TRUST, INC.
                            FUNDS FROM OPERATIONS
               (In thousands, except share and per share data)

The following table provides the calculation of our FFO and a reconciliation to net income available to common stockholders (in thousands, except per share amounts):

                                Three Months Ended      Nine Months Ended
                                  September 30,            September 30,
                                 2008       2007        2008         2007
                                   (Unaudited)             (Unaudited)

    Net income available
     to common stockholders    $12,982     $12,215     $39,633     $42,436
    Adjustments:
      Minority interests in
       operating partnership       559         545       1,767       1,895
      Loss/(gain) on sale of
       real estate assets            -           1           -      (1,087)
      Depreciation and
       amortization -
       unconsolidated
       partnerships                524         366       1,425         745
      Depreciation and
       amortization -
       consolidated entities -
       discontinued operations       -           -           -         228
      Depreciation and
       amortization -
       consolidated entities -
       continuing operations    21,506      17,665      58,525      54,556
      Depreciation and
       amortization - allocable
       to minority interest
       of consolidated
       joint ventures               (8)          -         (25)          -
    Funds from operations
     available to common
     shares and partnership
     and LTIP units            $35,563     $30,792    $101,325     $98,773
    Funds from operations
     per share - diluted         $0.48       $0.45       $1.40       $1.45
    Weighted-average common
     shares outstanding
     - diluted              74,714,841  68,274,908  72,120,329  68,262,086


We present funds from operations, or FFO, available to common shares and partnership and LTIP units because we consider it an important supplemental measure of our operating performance and believe it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions and extraordinary items, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from net income. We compute FFO in accordance with standards established by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT, in its March 1995 White Paper (as amended in November 1999 and April 2002). As defined by NAREIT, FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property, plus real estate related depreciation and amortization (excluding amortization of loan origination costs) and after adjustments for unconsolidated partnerships and joint ventures. Our computation may differ from the methodology for calculating FFO utilized by other equity REITs and, accordingly, may not be comparable to such other REITs. Further, FFO does not represent amounts available for management's discretionary use because of needed capital replacement or expansion, debt service obligations, or other commitments and uncertainties. FFO should not be considered as an alternative to net income (loss) (computed in accordance with GAAP) as an indicator of our financial performance or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends or make distributions.

SOURCE: BioMed Realty Trust, Inc.

CONTACT:
Kent Griffin, Chief Financial Officer of BioMed Realty Trust, Inc.,
+1-858-485-9840

Web site: http://www.biomedrealty.com