AmREIT Reports First Quarter Results and Second Quarter Dividend

AmREIT Reports First Quarter Results and Second Quarter Dividend

HOUSTON--(BUSINESS WIRE)-- AmREIT, Inc. (NYS: AMRE) ("AmREIT" or the "Company"), today announced financial results for the first quarter ended March 31, 2013 and dividends for the second quarter ended June 30, 2013.

First Quarter Highlights:


Financial Results

  • Core Funds from Operations ("Core FFO") available to common stockholders for the first quarter of 2013 was $4.3 million, or $0.27 per share, compared to $3.6 million, or $0.31 per share for the comparable period in 2012.

  • FFO available to common stockholders for the first quarter of 2013 was $4.1 million, or $0.26 per share, compared to $3.6 million, or $0.31 per share for the comparable period in 2012. Included in 2013 FFO was $164,000 in acquisition costs related to the MacArthur Park joint venture with Goldman Sachs.

  • Net income available to common stockholders for the first quarter of 2013 was $8.4 million, or $0.53 per share, compared to $1.3 million, or $0.11 per share, for the same period in 2012. Included in net income for the 2013 period was a $7.7 million gain on sale related to the sale of MacArthur Park and Pads into the joint venture with Goldman Sachs.

FFO and Core FFO are non-GAAP supplemental earnings measures that AmREIT considers meaningful in measuring its operating performance. Further explanation and a reconciliation of FFO and Core FFO to net income is attached to this press release.

Portfolio Results

  • In the first quarter of 2013, same-store net operating income ("NOI") increased 1.3% over the prior year period. During the period from January 1, 2010 through March 31, 2013, our same-store NOI has increased 3.0%.

  • Portfolio occupancy as of March 31, 2013 was 96.5%, a decrease of approximately 20 basis points as compared to portfolio occupancy of 96.7% as of December 31, 2012. On a leased basis (executed leases but where rent has not yet commenced), the portfolio was 97.2% leased as of March 31, 2013, with anticipated rent commencement during the second quarter.

  • During the first quarter of 2013, AmREIT signed 14 leases for 28,201 square feet of gross leasable area, including both new and renewal leases, and cash leasing spreads (i.e. new leasing rate per square foot compared to the expiring leasing rate per square foot) increased 6.7% for renewals and increased 41.4% for new comparable leases. On a GAAP basis (which includes the effects of straight-line rent), leasing spreads increased 10.2% on renewals and 56.4% on new comparable leases.

NOI is a non-GAAP supplemental earnings measure that AmREIT considers meaningful in measuring its operating performance. Further explanation and a reconciliation of NOI to net income is attached to this press release.

Dividends

  • AmREIT also announced today that the Company's Board of Directors has approved a regular quarterly cash dividend of $0.20 per share. The dividend will be paid on June 28, 2013 to all common stockholders of record on June 18, 2013.

Acquisitions and Dispositions

  • On March 26, 2013, we completed the entry into a joint venture (the Venture) with Goldman Sachs, in which the Venture acquired AmREIT's MacArthur Park and Pads shopping centers located in Dallas, Texas, along with the neighboring MacArthur Park Phase I shopping center from a third party. The Venture is a 70/30 joint venture whereby Goldman Sachs contributed cash for a 70% interest in the joint venture and AmREIT retained a 30% interest. The Venture placed mortgage financing on the entire combined property of approximately $43.9 million. At closing, AmREIT received net cash proceeds of approximately $35.6 million, which were used to repay borrowings under our unsecured credit facility. AmREIT will continue to manage and lease MacArthur Park on behalf of the joint venture and will retain a right of first offer to acquire the project in the future, after a lock-out period.

"I am pleased to report AmREIT posted solid results for the quarter, as our team advanced each of the four strategic initiatives set out in our IPO," said H. Kerr Taylor, Chairman and Chief Executive Officer of AmREIT. "First, internal growth through portfolio operations grew as same store NOI for the quarter was 1.3% and 3.0% since 2010; Second, growth within core markets was active with another Irreplaceable Corner property being placed under contract; Third, organic growth through incremental redevelopment continued with the launch of marketing for the first major densification project within Uptown Park; And fourth, accretive capital recycling was realized through a joint venture with Goldman Sachs."

Guidance

  • We reiterate our full year 2013 Core FFO and FFO guidance per share is as follows:

Projected 2013 Range

High

Low

Core FFO

$1.07

$1.02

FFO

$0.98

$0.93

Other Activities

  • AmREIT held its Annual Meeting of Stockholders at 10:00 AM Central Daylight Time on April 18, 2013.

  • At the Annual Meeting of Stockholders, stockholders approved, among other items, two charter amendments that, when taken together, had the effect of exchanging all of our issued and unissued shares of Class A common stock into shares of Class B common stock, on a one-for-one basis. We then renamed our Class B common stock to common stock, which are all now listed on the New York Stock Exchange.

Conference Call

AmREIT will hold its quarterly conference call to discuss the results of its first quarter of 2013 on Wednesday, May 8, 2013, at 10:00 a.m. Central Daylight Time (11:00 a.m. Eastern Daylight Time). To participate in the quarterly conference call, please call 1-888-317-6016 approximately 10 minutes before the scheduled start time. The conference call will be recorded and a replay of the call will be available via webcast shortly after the call concludes.

The conference call will also be webcast live at www.amreit.com and can be accessed under the Investors tab of the Company's website. A telephonic replay of the conference call will be available for 14 days following the conference call. To access the telephonic replay of the conference call, dial 1-877-344-7529 and enter passcode 10027417.

Supplemental Financial Information

Further details regarding AmREIT's results of operations, properties, and tenants are attached to this press release and can be accessed at the Company's web site at www.amreit.com.

About AmREIT

AmREIT believes it has one of the highest quality grocery and drugstore anchored retail portfolios in the REIT sector.AmREIT's 29-year-old established platform has localized acquisition, operation and redevelopment expertise in the most densely populated and affluent submarkets of five of the top markets in the U.S.:Houston, Dallas, San Antonio, Austin and Atlanta.Texas is one of the best performing economies in the country and 92% of AmREIT's income for the year ended December 31, 2012 was generated by its properties located in this market. AmREIT's management team has in-depth knowledge and extensive relationship advantages within its markets.AmREIT's portfolio was 96.5% occupied as of March 31, 2013, and its top five tenants include Kroger, Landry's, CVS/Pharmacy, H-E-B and Publix.AmREIT also has access to an acquisition pipeline through its value add joint ventures, including three leading institutional investors who partner with the company as local experts.AmREIT's common stock is traded on the New York Stock Exchange under the symbol "AMRE."For more information, please visitwww.amreit.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws, including statements related to full year 2013 Core FFO and FFO financial projections and the underlying assumptions of such projections stated herein.These forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as "may," "will," "should," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," or "potential" or the negative of these words and phrases or similar words or phrases, which are predictions of or indicate future events or trends and which do not relate solely to historical matters. While forward-looking statements reflect AmREIT's good faith beliefs, assumptions and expectations, they are not guarantees of future performance. Furthermore, AmREIT disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could impact AmREIT's future results, performance or transactions, see the section entitled "Risk Factors" in AmREIT's final prospectus dated July 26, 2012, filed with the Securities and Exchange Commission on July 27, 2012 and other risks described in documents subsequently filed by AmREIT from time to time with the Securities and Exchange Commission.

Investor Contact

For more information, call Chad Braun, Chief Operating Officer and Chief Financial Officer of AmREIT, at (713) 850-1400. AmREIT is online at www.amreit.com.

AmREIT, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands except share data)

March 31,

December 31,

2013

2012

ASSETS

(unaudited)

Real estate investments at cost:

Land

$

131,877

$

147,460

Buildings

191,743

222,679

Tenant improvements

13,540

17,386

337,160

387,525

Less accumulated depreciation and amortization

(32,635

)

(39,820

)

304,525

347,705

Acquired lease intangibles, net

13,331

15,976

Investments in Advised Funds

16,759

7,953

Net real estate investments

334,615

371,634

Cash and cash equivalents

4,913

2,992

Tenant and accounts receivable, net

5,246

5,566

Accounts receivable - related party, net

1,019

821

Notes receivable, net

2,773

2,731

Notes receivable - related party, net

7,074

6,748

Deferred costs, net

3,144

3,696

Other assets

1,460

3,206

TOTAL ASSETS

$

360,244

$

397,394

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Notes payable

$

181,096

$

218,579

Accounts payable and other liabilities

5,441

9,593

Acquired below-market lease intangibles, net

2,563

3,507

TOTAL LIABILITIES

189,100

231,679

Stockholders' equity:

Preferred stock, $0.01 par value, 50,000,000 shares authorized, none issued

-

-

Class A common stock, $0.01 par value, 100,000,000 shares authorized, 11,657,563 shares issued and outstanding as of March 31, 2013, and December 31, 2012

117

117

Class B common stock, $0.01 par value, 900,000,000 shares authorized, 4,512,225 and 4,465,725 shares issued and outstanding as of March 31, 2013, and December 31, 2012, respectively

45

45

Capital in excess of par value

245,670

245,403

Accumulated distributions in excess of earnings

(74,688

)

(79,850

)

TOTAL STOCKHOLDERS' EQUITY

171,144

165,715

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

360,244

$

397,394

AmREIT, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands except per share data)

(unaudited)

Three months ended March 31,

2013

2012

Revenues:

Rental income from operating leases

$

11,074

$

8,929

Advisory services income - related party

843

1,131

Total revenues

11,917

10,060

Expenses:

General and administrative

1,951

1,484

Property expense

3,119

2,213

Legal and professional

252

221

Real estate commissions

52

86

Depreciation and amortization

3,299

2,227

Total expenses

8,673

6,231

Operating income

3,244

3,829

Other income (expense):

Gain on sale of real estate acquired for investment

7,696

-

Interest and other income

113

102

Interest and other income - related party

56

72

Loss from Advised Funds

(148

)

(36

)

State income taxes

(72

)

(76

)

Interest expense

(2,493

)

(2,634

)

Net income

$

8,396

$

1,257

Net income per share of common stock - basic and diluted

$

0.53

$

0.11

Weighted average shares of common stock used to compute net income per share, basic and diluted

15,590

11,374

Distributions per share of common stock

$

0.20

$

0.20

Summary of Operating Results (in thousands except per share data):

Three months ended March 31,

Funds from operations ("FFO")

2013

2012

Net income

$

8,396

$

1,257

Add:

Depreciation of real estate assets - from operations

3,286

2,213

Depreciation of real estate assets for nonconsolidated affiliates

153

157

Less:

Gain on sale of real estate acquired for investment

(7,696

)

-

Total FFO available to stockholders

$

4,139

$

3,627

Weighted average shares outstanding(1)

16,132

11,607

Total FFO per share

$

0.26

$

0.31

Core funds from operations ("Core FFO")

Total FFO available to stockholders

$

4,139

$

3,627

Add:

Acquisition costs for nonconsolidated affiliates

164

-

Total Core FFO available to stockholders

$

4,303

$

3,627

Weighted average shares outstanding(1)

16,132

11,607

Total Core FFO per share