Brookfield Property Partners L.P. (NASDAQ: BPY; NASDAQ: BPR;
TSX: BPY.UN) (“BPY”) today announced financial results for the
quarter ended September 30, 2019.
“In the third quarter we continued to execute
our strategy of divesting interests in mature, stable assets at
premiums to our carrying values and reinvesting proceeds into
development and other higher returning opportunities, including
unit buybacks,” said Brian Kingston, Chief Executive Officer. “Our
development pipeline continues to advance and stabilize; recently
we were pleased to complete and deliver to the market nearly four
million square feet of modern, premier office space in New York
City and London.”
Financial Results
|
Three months endedSeptember 30, |
|
Nine months ended September 30, |
(US$ Millions, except
per unit amounts) |
2019 |
2018 |
|
2019 |
|
2018 |
Net
income(1) |
$ |
870 |
$ |
722 |
$ |
1,606 |
$ |
2,796 |
Company FFO and realized gains(2) |
$ |
324 |
$ |
302 |
$ |
1,053 |
$ |
821 |
Net income per LP unit(3)(4) |
$ |
0.46 |
$ |
0.44 |
$ |
0.90 |
$ |
1.79 |
Company FFO and
realized gains per unit(4)(5) |
$ |
0.34 |
$ |
0.38 |
$ |
1.09 |
$ |
1.11 |
- Consolidated basis – includes amounts attributable to
non-controlling interests.
- Excluding realized gains, Company FFO was $324 million compared
with $249 million in the prior year period. See "Basis of
Presentation" and “Reconciliation of Non-IFRS Measures” in this
press release for the definition and components.
- Represents basic net income attributable to holders of LP
units. IFRS requires the inclusion of preferred shares that are
mandatorily convertible into LP units at a price of $25.70 without
an add-back to earnings of the associated carry on the preferred
shares.
- Net income attributable to holders of LP units and Company FFO
and realized gains per unit are reduced by preferred dividends of
$5 million and $8 million for the three and nine months ended
September 30, 2019, respectively in determining per unit
amounts.
- Company FFO and realized gains per unit are calculated based on
950.1 million (2018 – 803.5 million) and 957.6 million (2018 –
737.1 million) units outstanding for the three and nine months
ended September 30, 2019, respectively. See reconciliation of
basic net income in the "Reconciliation of Non-IFRS Measures"
section in this press release.
Company FFO (CFFO) and realized gains was $324
million ($0.34 per unit) for the quarter ended September 30, 2019,
compared to $302 million ($0.38 per unit) for the same period in
2018. The increase in total CFFO and realized gains is primarily
attributable to earnings growth related to new capital invested in
our Core Retail business, same-property growth in our Core Office
business, and the recognition this quarter of $41 million in
incremental transaction and fee income. The decrease in CFFO
and realized gains per unit is attributable to $0.07 per unit in
realized gains in our LP investments segment recognized in the
prior-year period and the issuance of units in conjunction with the
acquisition of GGP in August 2018.
Net income for the quarter ended September 30,
2019 was $870 million ($0.46 per LP unit) versus $722 million
($0.44 per LP unit) for the same period in 2018.
Operating Highlights
Our Core Office operations generated Company FFO
of $150 million for the quarter ended September 30, 2019 compared
to $136 million in the same period in 2018. The business generated
2.5% same-property NOI growth and fee income of $41 million, which
was $20 million higher than in the prior period. The increase in
Company FFO over the prior year is primarily due to same-property
growth and increased fee income, partially offset by asset sales,
recent refinancings and a stronger U.S. dollar.
Occupancy in our Core Office portfolio finished
the third quarter at 92.4% on 1.9 million square feet of total
leasing, consistent with the prior quarter and a decrease of 50
basis points year-over-year. Leases signed in the third quarter
were at rents over 30% higher on average than leases that expired
in the period.
Our Core Retail operations generated Company FFO
of $201 million for the quarter ended September 30, 2019 compared
to $146 million in the comparable period in 2018. The increase over
the prior year reporting period is attributable to the acquisition
of GGP in the third quarter of 2018, a gain of $13 million from
land parcel sales, and the $15 million sale of an investment in an
operating company.
Same-property NOI was flat for the quarter and
year-to-date. Since the beginning of 2018, tenant bankruptcies have
resulted in over three million square feet within the portfolio
becoming vacant, of which nearly 75% will be occupied with new
tenants by this year-end and contributing to earnings.
Our Core Retail business leased over 10 million
square feet over the past 12 months with suite-to-suite
NOI-weighted rent spreads of 5.4%. At quarter-end, the
portfolio was 95.0% leased and we expect it to increase to 96% by
year-end. On a year-over-year basis, in-place rents increased 2.4%
across the portfolio, and NOI-weighted sales grew 5.4% to $787 per
square foot, a new high for the portfolio.
Our LP Investments generated Company FFO and
realized gains of $74 million for the quarter ended September 30,
2019, compared to $127 million in the comparable period in 2018.
Excluding $53 million of realized gains recognized in the
prior-year period, year-over-year performance in this segment was
flat.
Three months ended September 30, |
Nine months ended September 30, |
(US$
Millions) |
2019 |
|
2018 |
|
2019 |
|
2018 |
|
Company FFO and realized gains: |
|
|
|
Core Office |
|
$ |
|
150 |
|
$ |
136 |
|
$ |
477 |
|
$ |
438 |
|
Core Retail |
|
201 |
|
|
146 |
|
|
555 |
|
|
381 |
|
LP Investments |
|
74 |
|
|
127 |
|
|
326 |
|
|
311 |
|
Corporate |
|
(101 |
) |
|
(107 |
) |
|
(305 |
) |
|
(309 |
) |
Company FFO and realized gains(1) |
$ |
|
|
324 |
|
|
$ |
302 |
|
$ |
1,053 |
|
$ |
821 |
|
(1) See "Basis of Presentation" and
"Reconciliation of Non-IFRS Measures" below in this press release
for the definitions and components.
Dispositions
In the third quarter of 2019 we completed $1.4
billion of gross asset dispositions at our share, at prices that
were 4% higher than our IFRS carrying values. These sales generated
$723 million in net proceeds. Dispositions completed in the third
quarter include:
- Our 30% stake in the Darling Park Complex in Sydney for net
proceeds of $298 million.
- The office building at 3 Spring Street in Sydney for net
proceeds of $95 million.
- A 77% interest in two of our Brooklyn multifamily developments
at Greenpoint for net proceeds of $93 million.
- Our remaining 26% interest in the office building at 75 State
Street in Boston for net proceeds of $84 million.
- An 81% interest in the SoNo Collection mall in Norwalk, CT for
net proceeds of $83 million
- A portion of our triple net lease automotive dealership assets
(CARS) for net proceeds of $32 million.
Subsequent to quarter-end:
- The majority of assets in our Manhattan multifamily portfolio
for net proceeds of $135 million.
- Our 50% direct interest in Jessie Street Centre in Sydney for
net proceeds of $79 million.
New Investments
- Acquired a further 45% interest in the retail component at the
Crown Building in New York for $703 million.
Subsequent to quarter-end:
- Agreed to acquire an interest in two million square feet of
beachfront retail in Dubai for $1.3 billion ($91 million at BPY’s
share).
- Acquired an interest in a portfolio of luxury hotels and a
full-service management and hospitality brand in India for $692
million ($48 million at BPY’s share).
Balance Sheet Update
To increase liquidity and extend the maturity of our debt,
during and subsequent to the third quarter we executed the
following financing transactions:
- Refinanced 100 Bishopsgate in London for approximately $1.1
billion, generating net proceeds to BPY of approximately $450
million. The new mortgage is floating-rate with a term of
five years.
- In Core Retail, we raised an aggregate of $1.3 billion in
various financings, generating net proceeds to BPY of approximately
$343 million. The new asset-level mortgages are all floating-rate
with an average term of over four years.
- Issued $250 million of Perpetual Green Preferred Units (NASDAQ:
BPYPO) – the first of their kind in the industry – at an initial
distribution rate of 6.375% per annum.
Unit Repurchase Program
Utilizing in-place normal course issuer bids
(“NCIBs”), we purchased 2,046,757 of BPY units and BPR shares in
the third quarter of 2019 at an average price of $19.10 per
unit/share.
Subsequent to quarter-end, we purchased
1,041,067 additional BPY units at an average price of $19.14 per
unit/share.
Distribution Declaration
The Board of Directors has declared a quarterly
distribution on the partnership’s LP units of $0.33 per unit
payable on December 31, 2019 to unitholders of record at the close
of business on November 29, 2019.
The quarterly distributions on the LP units are
declared in U.S. dollars. Registered unitholders residing in the
United States shall receive quarterly cash distributions in U.S.
dollars and registered unitholders not residing in the United
States shall receive quarterly cash distributions in the Canadian
dollar equivalent, based on the Bank of Canada exchange rate on the
record date. Registered unitholders residing in the United States
have the option, through Brookfield Property Partners’ transfer
agent, AST Trust Company (Canada) ("AST"), to elect to receive
quarterly cash distributions in the Canadian dollar equivalent and
registered unitholders not residing in the United States have the
option through AST to elect to receive quarterly cash distributions
in U.S. dollars. Beneficial unitholders (i.e., those holding their
units in street name with their brokerage) should contact the
broker with whom their units are held to discuss their options
regarding distribution currency.
The Board of Directors has also declared a
quarterly distribution on the partnership’s Class A Series 1
preferred units of $0.40625 per unit, payable on December 31, 2019
to holders of record at the close of business on December 2,
2019.
The Board of Directors has also declared the
pro-rated initial distribution on the Class A Series 2 preferred
units of $0.57995 per unit, payable on December 31, 2019 to holders
of record at the close of business on December 2, 2019.
Additional Information
Further details regarding the operations of the Partnership are
set forth in regulatory filings. A copy of the filings may be
obtained through the website of the SEC at www.sec.gov and on the
Partnership’s SEDAR profile at www.sedar.com.
The Partnership’s quarterly letter to
unitholders and supplemental information package can be accessed
before the market open on August 2, 2019 at
bpy.brookfield.com. This additional information should be
read in conjunction with this press release.
Basis of Presentation
This press release and accompanying financial
information make reference to net operating income (“NOI”),
same-property NOI, funds from operations (“FFO”), Company FFO and
realized gains (“Company FFO and realized gains”) and net income
attributable to unitholders.
Company FFO and realized gains, and net income
attributable to unitholders are also presented on a per unit basis.
NOI, same-property NOI, FFO, Company FFO and realized gains, and
net income attributable to unitholders do not have any standardized
meaning prescribed by International Financial Reporting Standards
(“IFRS”) and therefore may not be comparable to similar measures
presented by other companies. The Partnership uses NOI,
same-property NOI, FFO, Company FFO and realized gains, and net
income attributable to unitholders to assess its operating results.
These measures should not be used as alternatives to Net Income and
other operating measures determined in accordance with IFRS, but
rather to provide supplemental insights into performance.
Further, these measures do not represent liquidity measures or cash
flow from operations and are not intended to be representative of
the funds available for distribution to unitholders either in
aggregate or on a per unit basis, where presented.
NOI is defined as revenues from commercial and
hospitality operations of consolidated properties less direct
commercial property and hospitality expenses. As NOI includes the
revenues and expenses directly associated with owning and operating
commercial property and hospitality assets, it provides a measure
to evaluate the performance of the property operations.
Same-property NOI is a subset of NOI, which
excludes NOI that is earned from assets acquired, disposed of or
developed during the periods presented, or not of a recurring
nature, and from opportunistic assets. Same-property NOI allows the
Partnership to segregate the performance of leasing and operating
initiatives on the portfolio from the impact to performance from
investing activities and “one-time items,” which for the historical
periods presented consist primarily of lease termination
income.
FFO is defined as income, including equity
accounted income, before realized gains (losses) from the sale of
investment property (except gains (losses) related to properties
developed for sale), fair value gains (losses) (including equity
accounted fair value gains (losses)), depreciation and amortization
of real estate assets, income tax expense (benefit), and less
non-controlling interests of others in operating subsidiaries and
properties. FFO is a widely recognized measure that is frequently
used by securities analysts, investors and other interested parties
in the evaluation of real estate entities, particularly those that
own and operate income producing properties. The Partnership’s
definition of FFO includes all of the adjustments that are outlined
in the National Association of Real Estate Investment Trusts
(“NAREIT”) definition of FFO. In addition to the adjustments
prescribed by NAREIT, the Partnership also makes adjustments to
exclude any unrealized fair value gains (or losses) that arise as a
result of reporting under IFRS, and income taxes that arise as
certain of its subsidiaries are structured as corporations as
opposed to real estate investment trusts (“REITs”). These
additional adjustments result in an FFO measure that is similar to
that which would result if the Partnership was organized as a REIT
that determined net income in accordance with generally accepted
accounting principles in the United States (“U.S. GAAP”), which is
the type of organization on which the NAREIT definition is
premised. The Partnership’s FFO measure will differ from other
organizations applying the NAREIT definition to the extent of
certain differences between the IFRS and U.S. GAAP reporting
frameworks, principally related to the recognition of lease
termination income. FFO provides a performance measure that, when
compared year-over-year, reflects the impact on operations from
trends in occupancy rates, rental rates, operating costs and
interest costs.
Company FFO and realized gains is defined as FFO
before the impact of depreciation and amortization of non-real
estate assets, transaction costs, gains (losses) associated with
non-investment properties, imputed interest on equity accounted
investments, realized gains in the partnership’s LP Investment
segment and the partnership’s share of BSREP III Company FFO and
realized gains. Realized LP Investment gains represent income
earned on investing activity when fund investments are realized,
inclusive of associated change in carried interest to be due at a
future date to the general partner of the relevant Brookfield Asset
Management-sponsored funds. The partnership accounts for the
investment in BSREP III as a financial asset and income (loss) of
the fund is not presented in the partnership’s results.
Distributions from BSREP III, recorded as dividend income under
IFRS, are removed from investment and other income for Company FFO
and realized gains presentation.
Net income attributable to unitholders is
defined as net income attributable to holders of general
partnership units and limited partnership units of the Partnership,
redeemable/exchangeable and special limited partnership units of
Brookfield Property L.P., limited partnership units of Brookfield
Office Properties Exchange LP and Class A shares of Brookfield
Property REIT Inc. Net income attributable to unitholders is used
by the Partnership to evaluate the performance of the Partnership
as a whole as each of the unitholders participates in the economics
of the Partnership equally. In calculating net income attributable
to unitholders per unit, the Partnership excludes the impact of
mandatorily convertible preferred units in determining the average
number of units outstanding as the holders of mandatorily
convertible preferred units do not participate in current
earnings. The Partnership reconciles this measure to basic
net income attributable to unitholders per unit determined in
accordance with IFRS which includes the effect of mandatorily
convertible preferred units in the basic average number of units
outstanding.
About Brookfield Property
Partners
Brookfield Property Partners, through Brookfield
Property Partners L.P. and its subsidiary Brookfield Property REIT
Inc., is one of the world’s premier real estate companies, with
approximately $85 billion in total assets. We own and operate
iconic properties in the world’s major markets, and our global
portfolio includes office, retail, multifamily, logistics,
hospitality, self-storage, triple net lease, manufactured housing
and student housing.
Brookfield Property Partners is the flagship
listed real estate company of Brookfield Asset Management Inc., a
leading global alternative asset manager with over $500 billion in
assets under management. More information is available at
www.brookfield.com.
Brookfield Property Partners L.P. is listed on
the Nasdaq Stock Market and the Toronto Stock Exchange. Brookfield
Property REIT Inc. is listed on the Nasdaq Stock Market. Further
information is available at bpy.brookfield.com.
Certain investor relations content is also
available on our investor relations app, which offers access to SEC
filings, press releases, presentations and more. Click here to
download on the iPhone or iPad, or here for Android mobile
devices.
Brookfield Contact:
Matt CherrySenior Vice President, Investor
RelationsTel: (212) 417-7488 / Email:
matthew.cherry@brookfield.com
Conference Call and Quarterly Earnings
Details
Investors, analysts and other interested parties
can access BPY’s third quarter 2019 results as well as the letter
to unitholders and supplemental information on BPY’s website at
bpy.brookfield.com.
The conference call can be accessed via webcast
on November 6, 2019 at 11:00 a.m. Eastern Time at
bpy.brookfield.com or via teleconference by dialing +1 (844)
358-9182 toll-free in the U.S. and Canada or for overseas calls,
dial +1 (478) 219-0399, conference ID: 6390568, at approximately
10:50 a.m. A recording of the teleconference can be accessed by
dialing +1 (855) 859-2056 toll-free in the U.S. or Canada or for
overseas calls, dial +1 (404) 537-3406, conference ID: 6390568.
Forward-Looking Statements
This communication contains “forward-looking
information” within the meaning of applicable securities laws and
regulations. Forward-looking statements include statements that are
predictive in nature or depend upon or refer to future events or
conditions, include statements regarding our operations, business,
financial condition, expected financial results, performance,
prospects, opportunities, priorities, targets, goals, ongoing
objectives, strategies and outlook, as well as the outlook for
North American and international economies for the current fiscal
year and subsequent periods, and include words such as “expects,”
“anticipates,” “plans,” “believes,” “estimates,” “seeks,”
“intends,” “targets,” “projects,” “forecasts,” “likely,” or
negative versions thereof and other similar expressions, or future
or conditional verbs such as “may,” “will,” “should,” “would” and
“could.”
Although we believe that our anticipated future
results, performance or achievements expressed or implied by the
forward-looking statements and information are based upon
reasonable assumptions and expectations, the reader should not
place undue reliance on forward-looking statements and information
because they involve known and unknown risks, uncertainties and
other factors, many of which are beyond our control, which may
cause our actual results, performance or achievements to differ
materially from anticipated future results, performance or
achievement expressed or implied by such forward-looking statements
and information.
Factors that could cause actual results to
differ materially from those contemplated or implied by
forward-looking statements include, but are not limited to: risks
incidental to the ownership and operation of real estate properties
including local real estate conditions; the impact or unanticipated
impact of general economic, political and market factors in the
countries in which we do business; the ability to enter into new
leases or renew leases on favorable terms; business competition;
dependence on tenants’ financial condition; the use of debt to
finance our business; the behavior of financial markets, including
fluctuations in interest and foreign exchange rates; uncertainties
of real estate development or redevelopment; global equity and
capital markets and the availability of equity and debt financing
and refinancing within these markets; risks relating to our
insurance coverage; the possible impact of international conflicts
and other developments including terrorist acts; potential
environmental liabilities; changes in tax laws and other tax
related risks; dependence on management personnel; illiquidity of
investments; the ability to complete and effectively integrate
acquisitions into existing operations and the ability to attain
expected benefits therefrom; operational and reputational risks;
catastrophic events, such as earthquakes and hurricanes; and other
risks and factors detailed from time to time in our documents filed
with the securities regulators in Canada and the United States.
We caution that the foregoing list of important
factors that may affect future results is not exhaustive. When
relying on our forward-looking statements or information, investors
and others should carefully consider the foregoing factors and
other uncertainties and potential events. Except as required by
law, we undertake no obligation to publicly update or revise any
forward-looking statements or information, whether written or oral,
that may be as a result of new information, future events or
otherwise.
CONSOLIDATED
BALANCE SHEETS |
|
|
|
|
|
|
|
Sep.
30, |
Dec. 31, |
|
(US$ Millions) |
|
2019 |
|
2018 |
|
Assets |
|
|
|
Investment properties |
$ |
70,786 |
$ |
80,196 |
|
Equity accounted investments in properties |
|
21,617 |
|
22,698 |
|
Property, plant and equipment |
|
6,769 |
|
7,506 |
|
Participating loan notes |
|
- |
|
268 |
|
Financial assets |
|
1,082 |
|
222 |
|
Accounts receivable and other |
|
4,881 |
|
7,338 |
|
Cash and cash equivalents |
|
2,141 |
|
3,288 |
|
Assets held for sale |
|
1,780 |
|
1,004 |
|
Total Assets |
$ |
109,056 |
$ |
122,520 |
|
Liabilities |
|
|
|
Corporate borrowings |
$ |
2,355 |
$ |
2,159 |
|
Asset-level debt obligations |
|
44,079 |
|
50,407 |
|
Subsidiary borrowings, non-recourse to BPY |
|
5,968 |
|
11,245 |
|
Capital securities |
|
3,029 |
|
3,385 |
|
Deferred tax liability |
|
2,548 |
|
2,378 |
|
Accounts payable and other liabilities |
|
4,996 |
|
6,043 |
|
Liabilities associated with assets held for sale |
|
1,118 |
|
163 |
|
Equity |
|
|
|
Preferred equity |
|
421 |
|
- |
|
General partner |
|
4 |
|
4 |
|
Limited partners |
|
12,799 |
|
12,353 |
|
Non-controlling interests attributable to: |
|
|
|
Limited partner units of the operating partnership held by
Brookfield Asset Management Inc. |
|
12,684 |
|
12,740 |
|
Limited partner units of Brookfield Office Properties Exchange
LP |
|
84 |
|
96 |
|
FV LTIP units of the operating partnership |
|
33 |
|
- |
|
Class A shares of Brookfield Property REIT Inc. |
|
1,914 |
|
3,091 |
|
Interests of others in operating subsidiaries and properties |
|
17,024 |
|
18,456 |
|
Total Equity |
|
44,963 |
|
46,740 |
|
Total Liabilities and Equity |
$ |
109,056 |
$ |
122,520 |
|
|
|
|
|
|
CONSOLIDATED
STATEMENT OF OPERATIONS |
|
|
|
|
|
|
|
Three Months Ended Sep. 30, |
Nine Months Ended Sep. 30, |
|
(US$ Millions) |
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
Commercial property and hospitality revenue |
$ |
1,852 |
|
$ |
1,753 |
|
$ |
5,706 |
|
$ |
4,938 |
|
|
Direct commercial property and hospitality expense |
|
(776 |
) |
|
(793 |
) |
|
(2,403 |
) |
|
(2,250 |
) |
|
|
|
|
1,076 |
|
|
960 |
|
|
3,303 |
|
|
2,688 |
|
|
Investment and other revenue |
|
165 |
|
|
75 |
|
|
410 |
|
|
161 |
|
|
Share of net earnings from equity accounted investments |
|
409 |
|
|
65 |
|
|
1,499 |
|
|
581 |
|
|
|
|
|
1,650 |
|
|
1,100 |
|
|
5,212 |
|
|
3,430 |
|
|
Expenses |
|
|
|
|
|
Interest expense |
|
(738 |
) |
|
(632 |
) |
|
(2,194 |
) |
|
(1,689 |
) |
|
Depreciation and amortization |
|
(86 |
) |
|
(81 |
) |
|
(256 |
) |
|
(229 |
) |
|
General and administrative expense |
|
(214 |
) |
|
(241 |
) |
|
(656 |
) |
|
(593 |
) |
|
Investment and other expense |
|
- |
|
|
(17 |
) |
|
(10 |
) |
|
(17 |
) |
|
|
|
|
612 |
|
|
129 |
|
|
2,096 |
|
|
902 |
|
|
Fair value gains, net |
|
449 |
|
|
556 |
|
|
(273 |
) |
|
1,943 |
|
|
Income tax (expense) benefit |
|
(191 |
) |
|
37 |
|
|
(217 |
) |
|
(49 |
) |
|
Net income |
$ |
870 |
|
$ |
722 |
|
$ |
1,606 |
|
$ |
2,796 |
|
|
|
|
|
|
|
|
|
Net income attributable to: |
|
|
|
|
|
General partner |
$ |
- |
|
$ |
- |
|
$ |
- |
|
$ |
- |
|
|
Limited partners |
|
218 |
|
|
144 |
|
|
418 |
|
|
532 |
|
|
Non-controlling interests: |
|
|
|
|
|
Limited partner units of the operating partnership held by
Brookfield Asset Management Inc. |
|
218 |
|
|
206 |
|
|
427 |
|
|
857 |
|
|
Limited partner units of Brookfield Office Properties Exchange
LP |
|
2 |
|
|
2 |
|
|
3 |
|
|
16 |
|
|
FV LTIP units of the operating partnership |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
Class A shares of Brookfield Property REIT |
|
36 |
|
|
28 |
|
|
86 |
|
|
39 |
|
|
Interests of others in operating subsidiaries and properties |
|
396 |
|
|
342 |
|
|
672 |
|
|
1,352 |
|
|
|
|
$ |
870 |
|
$ |
722 |
|
$ |
1,606 |
|
$ |
2,796 |
|
|
|
|
|
|
|
|
|
RECONCILIATION OF NON-IFRS MEASURES |
|
|
|
|
|
|
|
Three Months Ended Sep. 30, |
Nine Months Ended Sep. 30, |
(US$ Millions) |
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Commercial property and hospitality revenue |
$ |
1,852 |
|
$ |
1,753 |
|
$ |
5,706 |
|
$ |
4,938 |
|
Direct commercial property and hospitality expense |
|
(776 |
) |
|
(793 |
) |
|
(2,403 |
) |
|
(2,250 |
) |
NOI |
|
1,076 |
|
|
960 |
|
|
3,303 |
|
|
2,688 |
|
Investment and other revenue |
|
165 |
|
|
75 |
|
|
410 |
|
|
161 |
|
Share of equity accounted income excluding fair value gains |
|
177 |
|
|
117 |
|
|
622 |
|
|
548 |
|
Interest expense |
|
(738 |
) |
|
(632 |
) |
|
(2,194 |
) |
|
(1,689 |
) |
General and administrative expense |
|
(214 |
) |
|
(241 |
) |
|
(656 |
) |
|
(593 |
) |
Investment and other expense |
|
- 0 |
|
|
(17 |
) |
|
(10 |
) |
|
(17 |
) |
Depreciation and amortization of non-real estate assets |
|
(14 |
) |
|
(11 |
) |
|
(45 |
) |
|
(28 |
) |
Non-controlling interests of others in operating subsidiaries and
properties in FFO |
|
(191 |
) |
|
(128 |
) |
|
(620 |
) |
|
(509 |
) |
FFO |
|
261 |
|
|
123 |
|
|
810 |
|
|
561 |
|
Depreciation and amortization of non-real estate assets,
net(1) |
|
10 |
|
|
9 |
|
|
31 |
|
|
24 |
|
Transaction costs(1) |
|
35 |
|
|
103 |
|
|
72 |
|
|
136 |
|
Gains/losses on disposition of non-investment properties(1) |
|
1 |
|
|
1 |
|
|
- |
|
|
4 |
|
Imputed Interest(2) |
|
15 |
|
|
13 |
|
|
42 |
|
|
38 |
|
LP Investments realized gains(3) |
|
- |
|
|
53 |
|
|
87 |
|
|
58 |
|
BSREP III earnings(4) |
|
2 |
|
|
- |
|
|
11 |
|
|
- |
|
Company FFO and realized gains |
$ |
324 |
|
$ |
302 |
|
$ |
1,053 |
|
$ |
821 |
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO |
|
261 |
|
|
123 |
|
|
810 |
|
|
561 |
|
Depreciation and amortization of real estate assets |
|
(72 |
) |
|
(70 |
) |
|
(211 |
) |
|
(201 |
) |
Fair value (losses) gains, net |
|
449 |
|
|
556 |
|
|
(273 |
) |
|
1,943 |
|
Share of equity accounted income - Non FFO |
|
232 |
|
|
(52 |
) |
|
877 |
|
|
33 |
|
Income tax (expense) benefit |
|
(191 |
) |
|
37 |
|
|
(217 |
) |
|
(49 |
) |
Non-controlling interests of others in operating subsidiaries and
properties in non-FFO |
|
(205 |
) |
|
(214 |
) |
|
(52 |
) |
|
(843 |
) |
Non-controlling interests of others in operating subsidiaries and
properties |
|
396 |
|
|
342 |
|
|
672 |
|
|
1,352 |
|
Net income |
$ |
870 |
|
$ |
722 |
|
$ |
1,606 |
|
$ |
2,796 |
|
(1)Presented net of non-controlling interests on a proportionate
basis. |
(2)Represents imputed interest on commercial developments accounted
for under the equity method under IFRS. |
(3)Net of associated carried interest to be due at a future
date. |
(4)BSREP III is now accounted for as a financial asset which
results in FFO being recognized in line with distributions. As
such, the BSREP III earnings adjustment reflects our proportionate
share of the Company FFO. |
|
|
|
|
|
|
NET INCOME PER UNIT |
|
|
Three months ended |
|
|
Sep. 30, 2019 |
|
Sep.30, 2018 |
(US$ Millions, except per unit amounts) |
Net income attributable to Unitholders |
Average number of units |
Per unit |
|
Net income attributable to Unitholders |
Average number of units |
Per unit |
Basic |
$ |
474 |
|
950.1 |
$ |
0.50 |
|
$ |
380 |
803.5 |
$ |
0.47 |
Preferred share dividends |
|
(5 |
) |
- |
|
- |
|
|
- |
- |
|
- |
Number of units on conversion of preferred shares(1) |
|
- |
|
70.1 |
|
- 0 |
|
|
- |
70.0 |
|
- 0 |
Basic per IFRS |
|
469 |
|
1,020.2 |
|
0.46 |
|
|
380 |
873.5 |
|
0.44 |
Dilutive effect of conversion of capital securities and
options(2) |
|
- |
|
- |
|
- 0 |
|
|
7 |
19.9 |
|
0.35 |
Fully-diluted per IFRS |
$ |
469 |
|
1,020.2 |
$ |
0.46 |
|
$ |
387 |
893.4 |
$ |
0.43 |
(1) IFRS requires the inclusion of preferred shares that are
mandatorily convertible into units at a price of $25.70 without an
add back to earnings of the associated carry on the preferred
shares. |
(2)For the three months ended September 30, 2019, capital
securities were fully redeemed and therefore excluded from the
calculation of fully-diluted net income per IFRS. |
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
Sep. 30, 2019 |
|
Sep.30, 2018 |
(US$ Millions, except per unit amounts) |
Net income attributable to Unitholders |
Average number of units |
Per unit |
|
Net income attributable to Unitholders |
Average number of units |
Per unit |
Basic per management |
$ |
474 |
|
950.1 |
$ |
0.50 |
|
$ |
380 |
803.5 |
$ |
0.47 |
Preferred share dividends |
|
(5 |
) |
- |
|
- |
|
|
- |
- |
|
- |
Dilutive effect of conversion of preferred shares(1) |
|
29 |
|
70.1 |
|
0.41 |
|
|
29 |
70.0 |
|
0.41 |
Dilutive effect of conversion of capital securities and
options(2) |
|
- |
|
- |
|
- 0 |
|
|
7 |
19.9 |
|
0.35 |
Fully-diluted per management |
$ |
498 |
|
1,020.2 |
$ |
0.49 |
|
$ |
416 |
893.4 |
$ |
0.47 |
(1) Represents preferred shares that are mandatorily
convertible into units at a price of $25.70 and the associated
carry. |
(2) For the three months ended September 30, 2019, capital
securities were fully redeemed and therefore excluded from the
calculation of fully-diluted net income per IFRS. |
NET INCOME PER UNIT |
|
|
Nine months ended |
|
|
|
Sep. 30, 2019 |
|
Sep.30, 2018 |
|
(US$ Millions, except per unit amounts) |
Net income attributable to Unitholders |
Average number of units |
Per unit |
|
Net income attributable to Unitholders |
Average number of units |
Per unit |
|
Basic |
$ |
934 |
|
957.6 |
$ |
0.98 |
|
$ |
1,444 |
737.1 |
$ |
1.96 |
|
Preferred share dividends |
|
(8 |
) |
- |
|
- |
|
|
- |
- |
|
- |
|
Number of units on conversion of preferred shares(1) |
|
- |
|
70.1 |
|
- |
|
|
- |
70.0 |
|
- |
|
Basic per IFRS |
|
926 |
|
1,027.7 |
|
0.90 |
|
|
1,444 |
807.1 |
|
1.79 |
|
Dilutive effect of conversion of capital securities and
options |
|
8 |
|
9.0 |
|
0.89 |
|
|
20 |
18.4 |
|
1.09 |
|
Fully-diluted per IFRS |
$ |
934 |
|
1,036.7 |
$ |
0.90 |
|
$ |
1,464 |
825.5 |
$ |
1.77 |
|
(1)IFRS requires the inclusion of preferred shares that are
mandatorily convertible into units at a price of $25.70 without an
add back to earnings of the associated carry on the preferred
shares. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended |
|
|
|
Sep. 30, 2019 |
|
Sep.30, 2018 |
|
(US$ Millions, except per unit amounts) |
Net income attributable to Unitholders |
Average number of units |
Per unit |
|
Net income attributable to Unitholders |
Average number of units |
Per unit |
|
Basic per management |
$ |
934 |
|
957.6 |
$ |
0.98 |
|
$ |
1,444 |
737.1 |
$ |
1.96 |
|
Preferred share dividends |
|
(8 |
) |
- |
|
- |
|
|
- |
- |
|
- |
|
Dilutive effect of conversion of preferred shares(1) |
|
88 |
|
70.1 |
|
1.26 |
|
|
88 |
70.0 |
|
1.26 |
|
Dilutive effect of conversion of capital securities and
options |
|
8 |
|
9.0 |
|
0.89 |
|
|
20 |
18.4 |
|
1.09 |
|
Fully-diluted per management |
$ |
1,022 |
|
1,036.7 |
$ |
0.99 |
|
$ |
1,552 |
825.5 |
$ |
1.88 |
|
(1)Represents preferred shares that are mandatorily convertible
into units at a price of $25.70 and the associated carry. |
|
|
|
|
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