Creative Media & Community Trust Corporation (NASDAQ and
TASE: CMCT) (“we”, “our”, “CMCT”, or the “Company”), today reported
operating results for the three months and year ended December 31,
2023.
Fourth Quarter 2023 Highlights
Real Estate Portfolio
- Same-store office portfolio(2) was 84.0% leased.
- Executed 38,280 square feet of leases with terms longer than 12
months.
Financial Results
- Net loss attributable to common stockholders of $16.3 million,
or $0.72 per diluted share.
- Funds from operations attributable to common stockholders
(“FFO”)(3)1 was $(9.9) million, or $(0.44) per diluted share.
- Core FFO attributable to common stockholders(4)1 was $(8.4)
million, or $(0.37) per diluted share.
Management Commentary
“We made additional strides in early 2024 improving our
multifamily occupancy,” said David Thompson, Chief Executive
Officer of Creative Media & Community Trust Corporation. “We
believe there is a significant opportunity to improve our
multifamily net operating income after we acquired two premier
Class A multifamily residences in 2023 that are still in their
lease-up phase following completion of construction.”
“We continue to make progress on our value-add and development
pipeline,” said Shaul Kuba, Chief Investment Officer of Creative
Media & Community Trust Corporation. “Our partial office to
multifamily conversion at 4750 Wilshire Boulevard is expected to be
complete later this year adding 68 luxury residences, and we
recently commenced construction on a 36-unit residence in Echo
Park, Los Angeles that is slated for completion in 2025.”
Fourth Quarter 2023 Results
Real Estate Portfolio
As of December 31, 2023, our real estate portfolio consisted of
27 assets, all of which were fee-simple properties and five of
which we own through investments in unconsolidated joint ventures
(the “Unconsolidated Joint Ventures”). The Unconsolidated Joint
Ventures own two office properties (one of which is being partially
converted into multifamily units), one multifamily site currently
under development, one multifamily property and one commercial
development site. The portfolio includes 13 office properties,
totaling approximately 1.3 million rentable square feet, three
multifamily properties totaling 696 units, nine development sites
(three of which are being used as parking lots) and one 503-room
hotel with an ancillary parking garage.
Financial Results
Net loss attributable to common stockholders was $16.3 million,
or $0.72 per diluted share of common stock, for the three months
ended December 31, 2023, compared to a net loss attributable to
common stockholders of $8.9 million, or $0.39 per diluted share of
common stock, for the same period in 2022. The increase in net loss
attributable to common stockholders was driven by the $6.3 million
decrease in FFO discussed below as well as an increase in
depreciation and amortization expense of $1.2 million.
FFO attributable to common stockholders(3)1 was $(9.9) million,
or $(0.44) per diluted share of common stock, for the three months
ended December 31, 2023, a decrease of $6.3 million compared to
$(3.7) million, or $(0.16) per diluted share of common stock, for
the same period in 2022. The decrease in FFO1 was primarily
attributable to an increase in interest expense not allocated to
our operating segments of $6.8 million and an increase in
redeemable preferred stock dividends of $5.6 million. These were
partially offset by a decrease in the consolidated statement of
operations impact of redeemable preferred stock redemptions of $7.6
million (due to the $7.9 million recognized in the prior comparable
period in connection with the redemption of Series L Preferred
stock during the three months ended December 31, 2022).
Core FFO attributable to common stockholders(4)2 was $(8.4)
million, or $(0.37) per diluted share of common stock, for the
three months ended December 31, 2023, compared to $4.4 million, or
$0.11 per diluted share of common stock, for the same period in
2022. The decrease in Core FFO2 is attributable to the
aforementioned changes in FFO2, while not impacted by the decrease
in redeemable preferred stock redemptions as these are excluded
from our Core FFO2 calculation.
Segment Information
Our reportable segments during the three months ended December
31, 2023 and 2022 consisted of three types of commercial real
estate properties, namely, office, hotel and multifamily, as well
as a segment for our lending business. Total segment net operating
income (“NOI”)(5) was $10.8 million for the three months ended
December 31, 2023, compared to $11.7 million for the same period in
2022.
Office
Same-Store
Same-store(2) office segment NOI(5) decreased to $5.1 million
for the three months ended December 31, 2023, compared to $6.9
million in the same period in 2022, while same-store(1) office Cash
NOI(6)2 decreased to $6.4 million for the three months ended
December 31, 2023, compared to $7.1 million in the same period in
2022. The decrease in same-store(2) office Cash NOI(6)2 was
primarily attributable to a loss from an unconsolidated office
entity in Los Angeles, California due to an increase in interest
expense and a decline in value of the entity’s investments in real
estate, partially offset by an increase in rental revenue at an
office property in Beverly Hills, California due to increased
occupancy and rental rates and an increase in rental revenue at an
office property in Los Angeles, California due to increased
occupancy. The decrease in same-store(2) office segment NOI(5) was
primarily due to the aforementioned loss from an unconsolidated
office entity as well as a decrease in rental revenues at an office
property in Oakland, California due to the impact of an early lease
termination, partially offset by the aforementioned increase in
rental revenues at an office property in Beverly Hills,
California.
At December 31, 2023, the Company’s same-store(2) office
portfolio was 83.4% occupied, an increase of 210 basis points
year-over-year on a same-store(2) basis, and 84.0% leased, a
decrease of 20 basis points year-over-year on a same-store(2)
basis. The annualized rent per occupied square foot(7) on a
same-store(2) basis was $57.28 at December 31, 2023 compared to
$54.83 at December 31, 2022. During the three months ended December
31, 2023, the Company executed 38,280 square feet of leases with
terms longer than 12 months at our same-store(2) office
portfolio.
Total
Office Segment NOI(5) decreased to $5.4 million for the three
months ended December 31, 2023, from $6.9 million for the same
period in 2022. The decrease is due to the increase in
same-store(2) office segment NOI(5) discussed above, partially
offset by an increase in non-same-store(2) office Segment NOI(5) of
$354,000, which was driven by income from an unconsolidated office
entity in Los Angeles, California during the three months ended
December 31, 2023.
Hotel
Hotel Segment NOI(5) decreased to $2.9 million for the three
months ended December 31, 2023, from $3.1 million for the same
period in 2022, primarily due to an increase in operating expenses,
partially offset by an increase in room revenues. Additionally,
hotel occupancy decreased slightly while average daily rate
increased.
Three Months Ended December
31,
2023
2022
Occupancy
69.9
%
71.5
%
Average daily rate(a)
$
195.04
$
178.72
Revenue per available room(b)
$
136.27
$
127.84
(a)
Calculated as trailing 3-month room
revenue divided by the number of rooms occupied.
(b)
Calculated as trailing 3-month room
revenue divided by the number of available rooms.
Multifamily
Our Multifamily Segment consists of two multifamily buildings
located in Oakland, California as well as an investment in a
multifamily building in the Echo Park neighborhood of Los Angeles,
California through one of the Unconsolidated Joint Ventures, all of
which were acquired during the first quarter of 2023. Our
Multifamily Segment NOI(5) was $1.1 million for the three months
ended December 31, 2023. As of December 31, 2023, our Multifamily
Segment was 79.3% occupied and the monthly rent per occupied
unit(8) was $2,805.
Lending
Our lending segment primarily consists of our SBA 7(a) lending
platform, which is a national lender that primarily originates
loans to small businesses in the hospitality industry. Lending
Segment NOI(5) was $1.3 million for the three months ended December
31, 2023, compared to $1.8 million for the same period in 2022. The
decrease was primarily due to an increase in interest expense
related to the issuance of new SBA 7(a) loan-backed notes in
connection with the securitization that closed in March 2023,
partially offset by an increase in revenues driven by an increase
in interest income as a result of the continuing higher interest
rate environment and an increase in premium income.
____________________
1
Non-GAAP financial measure. Refer to the
explanations and reconciliations elsewhere in this release.
2
Non-GAAP financial measure. Refer to the
explanations and reconciliations elsewhere in this release.
Debt and Equity
During the three months ended December 31, 2023, we issued
1,184,884 shares of Series A1 Preferred Stock for aggregate net
proceeds of $26.8 million. Net proceeds represent gross proceeds
offset by costs specifically identifiable to the offering, such as
commissions, dealer manager fees and other offering fees and
expenses. Additionally, during the three months ended December 31,
2023, we had net incremental paydowns of $20.0 million on our
revolving credit facility and refinanced a mortgage loan at a
multifamily property in Oakland, California, making a repayment of
$13.0 million and converting it to a fixed rate of 6.25% per
annum.
Dividends
On December 20, 2023, we declared a quarterly cash dividend of
$0.0850 per share of our common stock, which was paid on January 2,
2024.
On January 2, 2024, we declared a quarterly cash dividend of
$0.34375 per share of our Series A Preferred Stock for the first
quarter of 2024. The dividend will be payable monthly as follows:
$0.114583 per share to be paid on February 15, 2024 to Series A
Preferred Stockholders of record on February 5, 2024; $0.114583 per
share to be paid on March 15, 2024 to Series A Preferred
Stockholders of record on March 5, 2024; and $0.114583 per share to
be paid on April 15, 2024 to Series A Preferred Stockholders of
record on April 5, 2024.
On January 2, 2024, we declared a quarterly cash dividend of
$0.489375 per share of our Series A1 Preferred Stock for the first
quarter of 2024. The quarterly cash dividend of $0.489375 per share
represents an annualized dividend rate of 7.83% (2.5% plus the
federal funds rate of 5.33% on the applicable determination date).
The dividend will be payable monthly as follows: $0.163125 per
share to be paid on February 15, 2024 to Series A1 Preferred
Stockholders of record on February 5, 2024; $0.163125 per share to
be paid on March 15, 2024 to Series A1 Preferred Stockholders of
record on March 5, 2024; and $0.163125 per share to be paid on
April 15, 2024 to Series A1 Preferred Stockholders of record on
April 5, 2024. For shares of Series A1 Preferred Stock issued in
the first quarter of 2024, the dividend will be prorated from the
date of issuance, and the monthly dividend payments will reflect
such proration.
On January 2, 2024, we declared a quarterly cash dividend of
$0.353125 per share of our Series D Preferred Stock for the first
quarter of 2024. The dividend will be payable monthly as follows:
$0.117708 per share to be paid on February 15, 2024 to Series D
Preferred Stockholders of record on February 5, 2024; $0.117708 per
share to be paid on March 15, 2024 to Series D Preferred
Stockholders of record on March 5, 2024; and $0.117708 per share to
be paid on April 15, 2024 to Series D Preferred Stockholders of
record on April 5, 2024.
Acquisitions
The following table details our acquisition activity during the
year ended December 31, 2023:
Asset
Date of
Interest
Purchase
Property
Type
Acquisition
Units
Acquired
Price
(in thousands)
Channel House
Multifamily
January 31, 2023
333
89.4
%
$
134,615
F3 Land Site
Multifamily
(Development)
January 31, 2023
N/A
89.4
%
$
250
466 Water Street Land Site (1)
Multifamily
(Development)
January 31, 2023
N/A
89.4
%
$
2,500
1150 Clay
Multifamily
March 28, 2023
288
98.1
%
$
145,500
4750 Wilshire Boulevard (2)(3)
Office / Multifamily
(Development)
February 17, 2023
N/A
20.0
%
$
8,600
1902 Park Avenue (2)
Multifamily
February 28, 2023
75
50.0
%
$
9,563
1015 N Mansfield Avenue (2)(4)
Office
(Development)
October 10, 2023
N/A
28.8
%
$
5,184
(1)
Currently utilized as a surface parking
lot.
(2)
Represents an Unconsolidated Joint Venture
investment. The purchase price represents our share of the gross
purchase price.
(3)
We sold 80% of our interest in 4750
Wilshire Boulevard (excluding a vacant land parcel which was not
included in the sale) to third-party co-investors with whom we
formed an Unconsolidated Joint Venture. The remaining 20% interest
represents our interest in the newly formed Unconsolidated Joint
Venture.
(4)
1015 N Mansfield Avenue is an office
building with a 44,141 square foot site area and a parking garage.
The site is being evaluated for different creative office
development options.
About the Data
Descriptions of certain performance measures, including Segment
NOI, Cash NOI, FFO attributable to common stockholders, and Core
FFO attributable to common stockholders are provided below. Certain
of these performance measures—Cash NOI, FFO attributable to common
stockholders and Core FFO attributable to common stockholders—are
non-GAAP financial measures. Refer to the subsequent tables for
reconciliation of these non-GAAP financial measures to the most
directly comparable GAAP financial measure.
(1)
Stabilized office
portfolio: represents office properties where
occupancy was not impacted by a redevelopment or repositioning
during the period.
(2)
Same-store
properties: are properties that we have owned and
operated in a consistent manner and reported in our consolidated
results during the entire span of the periods being reported. We
excluded from our same-store property set this quarter any
properties (i) acquired on or after October 1, 2022; (ii) sold or
otherwise removed from our consolidated financial statements on or
before December 31, 2023; or (iii) that underwent a major
repositioning project we believed significantly affected its
results at any point during the period commencing on October 1,
2022 and ending on December 31, 2023. When determining our
same-store properties as of December 31, 2023, one property was
excluded pursuant to (i) and (iii) above and no properties were
excluded pursuant to (ii) above.
(3)
FFO attributable
to common stockholders (“FFO”): represents net
income (loss) attributable to common stockholders, computed in
accordance with GAAP, which reflects the deduction of redeemable
preferred stock dividends accumulated, excluding gain (or loss)
from sales of real estate, impairment of real estate, and real
estate depreciation and amortization. We calculate FFO in
accordance with the standards established by the National
Association of Real Estate Investment Trusts (the “NAREIT”). See
‘Core FFO’ definition below for discussion of the benefits and
limitations of FFO as a supplemental measure of operating
performance.
(4)
Core FFO
attributable to common stockholders (“Core FFO”):
represents FFO attributable to common stockholders (computed as
described above), excluding gain (loss) on early extinguishment of
debt, redeemable preferred stock deemed dividends, redeemable
preferred stock redemptions, gain (loss) on termination of interest
rate swaps, and transaction costs.
We believe that FFO is a widely recognized
and appropriate measure of the performance of a REIT and that 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. In addition, we believe
that Core FFO is a useful metric for securities analysts, investors
and other interested parties in the evaluation of our Company as it
excludes from FFO the effect of certain amounts that we believe are
non-recurring, are non-operating in nature as they relate to the
manner in which we finance our operations, or transactions outside
of the ordinary course of business.
Like any metric, FFO and Core FFO should
not be used as the only measure of our performance because it
excludes depreciation and amortization and captures neither the
changes in the value of our real estate properties that result from
use or market conditions nor the level of capital expenditures and
leasing commissions necessary to maintain the operating performance
of our properties, and Core FFO excludes amounts incurred in
connection with non-recurring special projects, prepaying or
defeasing our debt, repurchasing our preferred stock, and adjusting
the carrying value of our preferred stock classified in temporary
equity to its redemption value, all of which have real economic
effect and could materially impact our operating results. Other
REITs may not calculate FFO and Core FFO in the same manner as we
do, or at all; accordingly, our FFO and Core FFO may not be
comparable to the FFOs and Core FFOs of other REITs. Therefore, FFO
and Core FFO should be considered only as a supplement to net
income (loss) as a measure of our performance and should not be
used as a supplement to or substitute measure for cash flows from
operating activities computed in accordance with GAAP. FFO and Core
FFO should not be used as a measure of our liquidity, nor is it
indicative of funds available to fund our cash needs, including our
ability to pay dividends. FFO and Core FFO per share for the
year-to-date period may differ from the sum of quarterly FFO and
Core FFO per share amounts due to the required method for computing
per share amounts for the respective periods. In addition, FFO and
Core FFO per share is calculated independently for each component
and may not be additive due to rounding.
(5)
Segment
NOI: for our real estate segments represents
rental and other property income and expense reimbursements less
property related expenses and excludes non-property income and
expenses, interest expense, depreciation and amortization,
corporate related general and administrative expenses, gain (loss)
on sale of real estate, gain (loss) on early extinguishment of
debt, impairment of real estate, transaction costs, and benefit
(provision) for income taxes. For our lending segment, Segment NOI
represents interest income net of interest expense and general
overhead expenses. See ‘Cash NOI’ definition below for discussion
of the benefits and limitations of Segment NOI as a supplemental
measure of operating performance.
(6)
Cash
NOI: for our real estate segments, represents
Segment NOI adjusted to exclude the effect of the straight lining
of rents, acquired above/below market lease amortization and other
adjustments required by generally accepted accounting principles
(“GAAP”). For our lending segment, there is no distinction between
Cash NOI and Segment NOI. We also evaluate the operating
performance and financial results of our operating segments using
cash basis NOI excluding lease termination income, or “Cash NOI
excluding lease termination income”.
Segment NOI and Cash NOI are not measures
of operating results or cash flows from operating activities as
measured by GAAP and should not be considered alternatives to
income from continuing operations, or to cash flows as a measure of
liquidity, or as an indication of our performance or of our ability
to pay dividends. Companies may not calculate Segment NOI or Cash
NOI in the same manner. We consider Segment NOI and Cash NOI to be
useful performance measures to investors and management because,
when compared across periods, they reflect the revenues and
expenses directly associated with owning and operating our
properties and the impact to operations from trends in occupancy
rates, rental rates and operating costs, providing a perspective
not immediately apparent from income from continuing operations.
Additionally, we believe that Cash NOI is helpful to investors
because it eliminates straight line rent and other non-cash
adjustments to revenue and expenses.
(7)
Annualized rent
per occupied square foot: represents gross
monthly base rent under leases commenced as of the specified
periods, multiplied by twelve. This amount reflects total cash rent
before abatements. Where applicable, annualized rent has been
grossed up by adding annualized expense reimbursements to base
rent. Annualized rent for certain office properties includes rent
attributable to retail.
(8)
Monthly rent per
occupied unit: Represents gross monthly base rent
under leases commenced as of the specified period, divided by
occupied units. This amount reflects total cash rent before
concessions.
FORWARD-LOOKING STATEMENTS
This press release contains certain “forward-looking statements”
within the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), which are intended to be covered by
the safe harbors created thereby. These statements include the
plans and objectives of management for future operations, including
plans and objectives relating to future growth of CMCT’s business
and availability of funds. Such forward-looking statements can be
identified by the use of forward-looking terminology such as “may,”
“will,” “project,” “target,” “expect,” “intend,” “might,”
“believe,” “anticipate,” “estimate,” “could,” “would,” “continue,”
“pursue,” “potential,” “forecast,” “seek,” “plan,” or “should,” or
“goal” or the negative thereof or other variations or similar words
or phrases. Such forward-looking statements also include, among
others, statements about CMCT’s plans and objectives relating to
future growth and outlook. Such forward-looking statements are
based on particular assumptions that management of CMCT has made in
light of its experience, as well as its perception of expected
future developments and other factors that it believes are
appropriate under the circumstances. Forward-looking statements are
necessarily estimates reflecting the judgment of CMCT’s management
and involve a number of risks and uncertainties that could cause
actual results to differ materially from those suggested by the
forward-looking statements. These risks and uncertainties include
those associated with (i) the timing, form, and operational effects
of CMCT’s development activities, (ii) the ability of CMCT to raise
in place rents to existing market rents and to maintain or increase
occupancy levels, (iii) fluctuations in market rents, (iv) the
effects of inflation and continuing higher interest rates on the
operations and profitability of CMCT and (v) general economic,
market and other conditions. Additional important factors that
could cause CMCT’s actual results to differ materially from CMCT’s
expectations are discussed in “Item 1A—Risk Factors” in CMCT’s
Annual Report on Form 10-K for the year ended December 31, 2023.
The forward-looking statements included herein are based on current
expectations and there can be no assurance that these expectations
will be attained. Assumptions relating to the foregoing involve
judgments with respect to, among other things, future economic,
competitive and market conditions and future business decisions,
all of which are difficult or impossible to predict accurately and
many of which are beyond CMCT’s control. Although we believe that
the assumptions underlying the forward-looking statements are
reasonable, any of the assumptions could be inaccurate and,
therefore, there can be no assurance that the forward-looking
statements expressed or implied will prove to be accurate. In light
of the significant uncertainties inherent in the forward-looking
statements expressed or implied herein, the inclusion of such
information should not be regarded as a representation by CMCT or
any other person that CMCT’s objectives and plans will be achieved.
Readers are cautioned not to place undue reliance on
forward-looking statements. Forward-looking statements speak only
as of the date they are made. CMCT does not undertake to update
them to reflect changes that occur after the date they are made,
except as may be required by applicable laws.
CREATIVE MEDIA & COMMUNITY
TRUST CORPORATION AND SUBSIDIARIES
Consolidated Balance
Sheets
(Unaudited and in thousands,
except share and per share amounts)
December 31, 2023
December 31, 2022
ASSETS
Investments in real estate, net
$
704,762
$
502,006
Investments in unconsolidated entities
33,505
12,381
Cash and cash equivalents
19,290
46,190
Restricted cash
24,938
11,290
Loans receivable, net (Note 5)
57,005
62,547
Accounts receivable, net
5,347
3,780
Deferred rent receivable and charges,
net
28,222
37,543
Other intangible assets, net
3,948
4,461
Other assets
14,183
10,050
TOTAL ASSETS
$
891,200
$
690,248
LIABILITIES, REDEEMABLE PREFERRED
STOCK, AND EQUITY
LIABILITIES:
Debt, net
$
471,561
$
184,267
Accounts payable and accrued expenses
26,426
107,220
Intangible liabilities, net
—
20
Due to related parties
3,463
3,155
Other liabilities
12,981
17,856
Total liabilities
514,431
312,518
COMMITMENTS AND CONTINGENCIES (Note
15)
REDEEMABLE PREFERRED STOCK: Series A
cumulative redeemable preferred stock, $0.001 par value; 34,611,501
and 35,438,752 shares authorized as of December 31, 2023 and
December 31, 2022, respectively; no shares issued and outstanding
as of December 31, 2023 and 693,741 shares issued and outstanding
as of December 31, 2022; liquidation preference of $25.00 per
share, subject to adjustment
—
15,697
EQUITY:
Series A cumulative redeemable preferred
stock, $0.001 par value; 34,611,501 and 35,438,752 shares
authorized as of December 31, 2023 and December 31, 2022,
respectively; 8,820,338 and 7,431,839 shares issued and
outstanding, respectively, as of December 31, 2023 and 8,126,597
and 7,565,349 shares issued and outstanding, respectively, as of
December 31, 2022; liquidation preference of $25.00 per share,
subject to adjustment
185,704
189,048
Series A1 cumulative redeemable preferred
stock, $0.001 par value; 27,904,974 and 27,990,070 shares
authorized as of December 31, 2023 and December 31, 2022,
respectively; 10,473,369 and 10,378,343 shares issued and
outstanding, respectively, as of December 31, 2023 and 5,966,077
and 5,956,147 shares issued and outstanding, respectively, as of
December 31, 2022; liquidation preference of $25.00 per share,
subject to adjustment
256,935
147,514
Series D cumulative redeemable preferred
stock, $0.001 par value; 26,991,590 and 26,992,000 shares
authorized as of December 31, 2023 and December 31, 2022,
respectively; 56,857 and 48,447 shares issued and outstanding,
respectively, as of December 31, 2023 and 56,857 and 48,857 shares
issued and outstanding as of December 31, 2022; liquidation
preference of $25.00 per share, subject to adjustment
1,190
1,200
Common stock, $0.001 par value;
900,000,000 shares authorized; 22,786,741 and 22,737,853 shares
issued and outstanding as of December 31, 2023 and December 31,
2022, respectively
23
23
Additional paid-in capital
852,476
861,721
Distributions in excess of earnings
(921,925
)
(837,846
)
Total stockholders’ equity
374,403
361,660
Noncontrolling interests
2,366
373
Total equity
376,769
362,033
TOTAL LIABILITIES, REDEEMABLE PREFERRED
STOCK, AND EQUITY
$
891,200
$
690,248
CREATIVE MEDIA & COMMUNITY
TRUST CORPORATION AND SUBSIDIARIES
Consolidated Statements of
Operations
(Unaudited and in thousands,
except per share amounts)
Three Months Ended
December 31,
Year Ended
December 31,
2023
2022
2023
2022
REVENUES:
Rental and other property income
$
16,003
$
13,742
$
66,002
$
56,226
Hotel income
9,473
8,956
39,063
33,432
Interest and other income
3,992
3,170
14,193
12,248
Total Revenues
29,468
25,868
119,258
101,906
EXPENSES:
Rental and other property operating
14,780
12,969
62,493
50,526
Asset management and other fees to related
parties
556
813
2,627
3,570
Expense reimbursements to related
parties—corporate
613
466
2,342
1,925
Expense reimbursements to related
parties—lending segment
413
317
2,579
1,929
Interest
10,420
2,838
35,098
9,604
General and administrative
2,368
1,894
8,119
6,869
Transaction costs
1,023
22
4,421
223
Depreciation and amortization
6,428
5,277
52,484
20,348
Total Expenses
36,601
24,596
170,163
94,994
(Loss) income from unconsolidated
entities
(1,480
)
(12
)
(427
)
164
Gain on sale of real estate
—
1,104
(LOSS) INCOME BEFORE PROVISION FOR INCOME
TAXES
(8,613
)
1,260
(50,228
)
7,076
Provision for income taxes
259
316
1,228
1,131
NET (LOSS) INCOME
(8,872
)
944
(51,456
)
5,945
Net loss (income) attributable to
noncontrolling interests
470
(8
)
2,971
(27
)
NET (LOSS) INCOME ATTRIBUTABLE TO THE
COMPANY
(8,402
)
936
(48,485
)
5,918
Redeemable preferred stock dividends
declared or accumulated
(7,390
)
(1,795
)
(25,731
)
(18,558
)
Redeemable preferred stock deemed
dividends
—
—
—
(19
)
Redeemable preferred stock redemptions
(471
)
(8,082
)
(1,511
)
(13,126
)
NET LOSS ATTRIBUTABLE TO COMMON
STOCKHOLDERS
$
(16,263
)
$
(8,941
)
$
(75,727
)
$
(25,785
)
NET LOSS ATTRIBUTABLE TO COMMON
STOCKHOLDERS PER SHARE:
Basic
$
(0.72
)
$
(0.39
)
$
(3.33
)
$
(1.11
)
Diluted
$
(0.72
)
$
(0.39
)
$
(3.33
)
$
(1.11
)
WEIGHTED AVERAGE SHARES OF COMMON STOCK
OUTSTANDING:
Basic
22,738
22,707
22,723
23,153
Diluted
22,738
22,712
22,723
23,154
CREATIVE MEDIA & COMMUNITY TRUST
CORPORATION AND SUBSIDIARIES Funds from Operations
Attributable to Common Stockholders (Unaudited and in
thousands, except per share amounts)
We believe that FFO is a widely recognized and appropriate
measure of the performance of a REIT and that 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 represents net income (loss) attributable to
common stockholders, computed in accordance with generally accepted
accounting principles ("GAAP"), which reflects the deduction of
redeemable preferred stock dividends accumulated, excluding gains
(or losses) from sales of real estate, impairment of real estate,
and real estate depreciation and amortization. We calculate FFO in
accordance with the standards established by the National
Association of Real Estate Investment Trusts (the "NAREIT").
Like any metric, FFO should not be used as the only measure of
our performance because it excludes depreciation and amortization
and captures neither the changes in the value of our real estate
properties that result from use or market conditions nor the level
of capital expenditures and leasing commissions necessary to
maintain the operating performance of our properties, all of which
have real economic effect and could materially impact our operating
results. Other REITs may not calculate FFO in accordance with the
standards established by the NAREIT; accordingly, our FFO may not
be comparable to the FFO of other REITs. Therefore, FFO should be
considered only as a supplement to net income (loss) as a measure
of our performance and should not be used as a supplement to or
substitute measure for cash flows from operating activities
computed in accordance with GAAP. FFO should not be used as a
measure of our liquidity, nor is it indicative of funds available
to fund our cash needs, including our ability to pay dividends. The
following table sets forth a reconciliation of net income (loss)
attributable to common stockholders to FFO attributable to common
stockholders for the three months and the years ended December 31,
2023 and 2022.
Three Months Ended
December 31,
Year Ended
December 31,
2023
2022
2023
2022
Numerator:
Net loss attributable to common
stockholders
$
(16,263
)
$
(8,941
)
$
(75,727
)
$
(25,785
)
Depreciation and amortization
6,428
5,277
52,484
20,348
Noncontrolling interests’ proportionate
share of depreciation and amortization
(104
)
—
(2,090
)
—
Gain on sale of real estate
—
—
(1,104
)
—
FFO attributable to common
stockholders
$
(9,939
)
$
(3,664
)
$
(26,437
)
$
(5,437
)
Redeemable preferred stock dividends
declared on dilutive shares (a)
—
(9
)
—
(15
)
Diluted FFO attributable to common
stockholders
$
(9,939
)
$
(3,673
)
$
(26,437
)
$
(5,452
)
Denominator:
Basic weighted average shares of common
stock outstanding
22,738
22,707
22,723
23,153
Effect of dilutive securities—contingently
issuable shares (a)
—
5
—
4
Diluted weighted average shares and common
stock equivalents outstanding
22,738
22,712
22,723
23,157
FFO attributable to common stockholders
per share:
Basic
$
(0.44
)
$
(0.16
)
$
(1.16
)
$
(0.23
)
Diluted
$
(0.44
)
$
(0.16
)
$
(1.16
)
$
(0.24
)
(a)
For the three months and years ended
December 31, 2023 and 2022, the effect of certain shares of
redeemable preferred stock were excluded from the computation of
diluted FFO attributable to common stockholders and the diluted
weighted average shares and common stock equivalents outstanding as
such inclusion would be anti-dilutive.
CREATIVE MEDIA & COMMUNITY TRUST
CORPORATION AND SUBSIDIARIES Core Funds from Operations
Attributable to Common Stockholders (Unaudited and in
thousands, except per share amounts)
In addition to calculating FFO in accordance with the standards
established by NAREIT, we also calculate a supplemental FFO metric
we call Core FFO attributable to common stockholders. Core FFO
attributable to common stockholders represents FFO attributable to
common stockholders, computed in accordance with NAREIT's
standards, excluding losses (or gains) on early extinguishment of
debt, redeemable preferred stock redemptions, gains (or losses) on
termination of interest rate swaps, and transaction costs. We
believe that Core FFO is a useful metric for securities analysts,
investors and other interested parties in the evaluation of our
Company as it excludes from FFO the effect of certain amounts that
we believe are non-recurring, are non-operating in nature as they
relate to the manner in which we finance our operations, or
transactions outside of the ordinary course of business.
Like any metric, Core FFO should not be used as the only measure
of our performance because, in addition to excluding those items
prescribed by NAREIT when calculating FFO, it excludes amounts
incurred in connection with non-recurring special projects,
prepaying or defeasing our debt and repurchasing our preferred
stock, all of which have real economic effect and could materially
impact our operating results. Other REITs may not calculate Core
FFO in the same manner as we do, or at all; accordingly, our Core
FFO may not be comparable to the Core FFO of other REITs who
calculate such a metric. Therefore, Core FFO should be considered
only as a supplement to net income (loss) as a measure of our
performance and should not be used as a supplement to or substitute
measure for cash flows from operating activities computed in
accordance with GAAP. Core FFO should not be used as a measure of
our liquidity, nor is it indicative of funds available to fund our
cash needs, including our ability to pay dividends. The following
table sets forth a reconciliation of net income (loss) attributable
to common stockholders to Core FFO attributable to common
stockholders for the three months and the years ended December 31,
2023 and 2022.
Three Months Ended
December 31,
Year Ended
December 31,
2023
2022
2023
2022
Numerator:
Net loss attributable to common
stockholders
$
(16,263
)
$
(8,941
)
$
(75,727
)
$
(25,785
)
Depreciation and amortization
6,428
5,277
52,484
20,348
Noncontrolling interests’ proportionate
share of depreciation and amortization
(104
)
—
(2,090
)
—
Gain on sale of real estate
—
—
(1,104
)
—
FFO attributable to common
stockholders
$
(9,939
)
$
(3,664
)
$
(26,437
)
$
(5,437
)
Redeemable preferred stock deemed
dividends
—
—
—
19
Redeemable preferred stock redemptions
471
8,082
1,511
13,126
Transaction-related costs
1,023
22
4,421
223
Noncontrolling interests’ proportionate
share of transaction-related costs
—
—
(194
)
—
Core FFO attributable to common
stockholders
$
(8,445
)
$
4,440
$
(20,699
)
$
7,931
Redeemable preferred stock dividends
declared on dilutive shares (a)
—
4,269
—
11,723
Diluted Core FFO attributable to common
stockholders
$
(8,445
)
$
8,709
$
(20,699
)
$
19,654
Denominator:
Basic weighted average shares of common
stock outstanding
22,738
22,707
22,723
23,153
Effect of dilutive securities-contingently
issuable shares (a)
—
54,095
—
37,711
Diluted weighted average shares and common
stock equivalents outstanding
22,738
76,802
22,723
60,864
Core FFO attributable to common
stockholders per share:
Basic
$
(0.37
)
$
0.20
$
(0.91
)
$
0.34
Diluted
$
(0.37
)
$
0.11
$
(0.91
)
$
0.32
(a)
For the three months and years ended
December 31, 2023 and 2022, the effect of certain shares of
redeemable preferred stock were excluded from the computation of
diluted Core FFO attributable to common stockholders and the
diluted weighted average shares and common stock equivalents
outstanding as such inclusion would be anti-dilutive.
CREATIVE MEDIA & COMMUNITY TRUST
CORPORATION AND SUBSIDIARIES Reconciliation of Net Operating
Income (Unaudited and in thousands)
We internally evaluate the operating performance and financial
results of our real estate segments based on segment NOI, which is
defined as rental and other property income and expense
reimbursements less property related expenses and excludes
non-property income and expenses, interest expense, depreciation
and amortization, corporate related general and administrative
expenses, gain (loss) on sale of real estate, gain (loss) on early
extinguishment of debt, impairment of real estate, transaction
costs, and provision for income taxes. For our lending segment, we
define segment NOI as interest income net of interest expense and
general overhead expenses. We also evaluate the operating
performance and financial results of our operating segments using
cash basis NOI, or "cash NOI". For our real estate segments, we
define cash NOI as segment NOI adjusted to exclude the effect of
the straight lining of rents, acquired above/below market lease
amortization and other adjustments required by GAAP.
Cash NOI is not a measure of operating results or cash flows
from operating activities as measured by GAAP and should not be
considered an alternative to income from continuing operations, or
to cash flows as a measure of liquidity, or as an indication of our
performance or of our ability to pay dividends. Companies may not
calculate cash NOI in the same manner. We consider cash NOI to be a
useful performance measure to investors and management because,
when compared across periods, it reflects the revenues and expenses
directly associated with owning and operating our properties and
the impact to operations from trends in occupancy rates, rental
rates and operating costs, providing a perspective not immediately
apparent from income from continuing operations. Additionally, we
believe that cash NOI is helpful to investors because it eliminates
straight line rent and other non-cash adjustments to revenue and
expenses.
Below is a reconciliation of cash NOI to segment NOI and net
income (loss) attributable to the Company for the three months
ended December 31, 2023 and 2022.
Three Months Ended December
31, 2023
Same-Store
Office
Non-Same-
Store
Office
Total Office
Hotel
Multi-
family
Lending
Total
Cash net operating income excluding lease
termination income
$
6,347
$
366
$
6,713
$
2,926
$
1,820
$
1,311
$
12,770
Cash lease termination income
102
—
102
—
43
—
145
Cash net operating income
6,449
366
6,815
2,926
1,863
1,311
12,915
Deferred rent and amortization of
intangible assets, liabilities, and lease inducements
(1,343
)
—
(1,343
)
(1
)
(754
)
—
(2,098
)
Straight line lease termination income
(53
)
—
(53
)
—
—
—
(53
)
Segment net operating income
$
5,053
$
366
$
5,419
$
2,925
$
1,109
$
1,311
$
10,764
Interest and other income
151
Asset management and other fees to related
parties
(556
)
Expense reimbursements to related parties
— corporate
(613
)
Interest expense
(9,465
)
General and administrative
(1,443
)
Transaction costs
(1,023
)
Depreciation and amortization
(6,428
)
Gain on sale of real estate
—
Loss before provision for income taxes
(8,613
)
Provision for income taxes
(259
)
Net loss
(8,872
)
Net loss attributable to noncontrolling
interests
470
Net loss attributable to the Company
$
(8,402
)
Three Months Ended December
31, 2022
Same-Store
Office
Non-Same-
Store
Office
Total Office
Hotel
Multi-
family
Lending
Total
Cash net operating income excluding lease
termination income
$
7,140
$
(161
)
$
6,979
$
3,097
$
—
$
1,752
$
11,828
Cash lease termination income
—
—
—
—
—
—
—
Cash net operating income
7,140
(161
)
6,979
3,097
—
1,752
11,828
Deferred rent and amortization of
intangible assets, liabilities, and lease inducements
(91
)
9
(82
)
(1
)
—
—
(83
)
Segment net operating income
$
6,885
$
12
$
6,897
$
3,096
$
—
$
1,752
$
11,745
Interest and other income
(1
)
Asset management and other fees to related
parties
(813
)
Expense reimbursements to related parties
— corporate
(466
)
Interest expense
(2,646
)
General and administrative
(1,260
)
Transaction costs
(22
)
Depreciation and amortization
(5,277
)
Income before provision for income
taxes
1,260
Provision for income taxes
(316
)
Net income
944
Net income attributable to noncontrolling
interests
(8
)
Net income attributable to the Company
$
936
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240327828019/en/
For Creative Media & Community Trust Corporation
Media Relations: Bill Mendel, 212-397-1030
bill@mendelcommunications.com
or
Shareholder Relations: Steve Altebrando, 646-652-8473
shareholders@cimcommercial.com
Grafico Azioni Creative Media and Commu... (NASDAQ:CMCT)
Storico
Da Dic 2024 a Gen 2025
Grafico Azioni Creative Media and Commu... (NASDAQ:CMCT)
Storico
Da Gen 2024 a Gen 2025
