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Actionable news in BRX: BRIXMOR PROPERTY GROUP Inc,

Quarterly report [Sections 13 or 15(d)]

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Maryland (Brixmor Property Group Inc.) 45-2433192
Delaware (Brixmor Operating Partnership LP) 80-0831163
(State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification No.)
Brixmor Property Group Inc. Brixmor Operating Partnership LP
Large accelerated filer þ Non-accelerated filer ¨ Large accelerated filer ¨ Non-accelerated filer þ
Smaller reporting company ¨ Accelerated filer ¨ Smaller reporting company ¨ Accelerated filer ¨
(Do not check if a smaller reporting company)
Item No. Page
Part I - FINANCIAL INFORMATION
1. Financial Statements 5
Brixmor Property Group Inc. (unaudited)
Condensed Consolidated Balance Sheets as of March 31, 2016 and December 31, 2015 5
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2016 and 2015 6
Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2016 and 2015 7
Condensed Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2016 and 2015 8
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2016 and 2015 9
Brixmor Operating Partnership LP (unaudited)
Condensed Consolidated Balance Sheets as of March 31, 2016 and December 31, 2015 10
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2016 and 2015 11
Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2016 and 2015 12
Condensed Consolidated Statements of Changes in Capital for the Three Months Ended March 31, 2016 and 2015 13
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2016 and 2015 14
Brixmor Property Group Inc. and Brixmor Operating Partnership LP (unaudited)
Notes to Condensed Consolidated Financial Statements 15
2. Management's Discussion and Analysis of Financial Condition and Results of Operations 26
3. Quantitative and Qualitative Disclosures about Market Risk 34
4. Controls and Procedures 34
Part II - OTHER INFORMATION
1. Legal Proceedings 36
1A. Risk Factors 36
2. Unregistered Sales of Equity Securities and Use of Proceeds 36
3. Defaults Upon Senior Securities 36
4. Mine Safety Disclosures 36
5. Other Information 36
6. Exhibits 37
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except share information)
March 31, 2016 December 31, 2015
Assets
Real estate
Land $ 2,012,905
$ 2,011,947
Buildings and improvements 8,934,306
8,920,903
10,947,211
10,932,850
Accumulated depreciation and amortization (1,957,169 ) (1,880,685 )
Real estate, net 8,990,042
9,052,165
Investments in and advances to unconsolidated joint ventures 5,023
5,019
Cash and cash equivalents 105,822
69,528
Restricted cash 44,211
41,462
Marketable securities 23,166
23,001
Receivables, net of allowance for doubtful accounts of $16,884 and $16,587 169,898
180,486
Deferred charges and prepaid expenses, net 109,813
109,149
Other assets 17,283
17,197
Total assets $ 9,465,258
$ 9,498,007
Liabilities
Debt obligations, net $ 6,007,397
$ 5,974,266
Accounts payable, accrued expenses and other liabilities 552,785
603,439
Total liabilities 6,560,182
6,577,705
Commitments and contingencies (Note 11)



Equity
Common stock, $0.01 par value; authorized 3,000,000,000 shares; 299,247,744 and 299,138,450 shares outstanding 2,992
2,991
Additional paid in capital 3,266,119
3,270,246
Accumulated other comprehensive loss (2,448 ) (2,509 )
Distributions in excess of net income (413,445 ) (400,945 )
Total stockholders’ equity 2,853,218
2,869,783
Non-controlling interests 51,858
50,519
Total equity 2,905,076
2,920,302
Total liabilities and equity $ 9,465,258
$ 9,498,007
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share data)
Three Months Ended March 31,
2016 2015
Revenues
Rental income $ 251,146
$ 243,570
Expense reimbursements 69,712
69,754
Other revenues 2,246
1,969
Total revenues 323,104
315,293
Operating expenses
Operating costs 35,051
35,160
Real estate taxes 44,391
44,189
Depreciation and amortization 100,479
108,544
Provision for doubtful accounts 2,740
2,495
Impairment of real estate assets
807
General and administrative 20,724
30,715
Total operating expenses 203,385
221,910
Other income (expense)
Dividends and interest 73
94
Interest expense (57,443 ) (62,564 )
Gain on extinguishment of debt, net
292
Other (907 ) (184 )
Total other expense (58,277 ) (62,362 )
Income before equity in income of unconsolidated joint ventures 61,442
31,021
Equity in income of unconsolidated joint ventures 107
115
Net income 61,549
31,136
Net income attributable to non-controlling interests (1,072 ) (713 )
Net income attributable to common stockholders $ 60,477
$ 30,423
Per common share:
Income from continuing operations:
Basic $ 0.20
$ 0.10
Diluted $ 0.20
$ 0.10
Net income attributable to common stockholders:
Basic $ 0.20
$ 0.10
Diluted $ 0.20
$ 0.10
Weighted average shares:
Basic 299,180
296,189
Diluted 299,379
297,715
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited, in thousands)
Three Months Ended March 31,
2016 2015
Net income $ 61,549
$ 31,136
Other comprehensive income (loss)
Unrealized loss on interest rate hedges (43 ) (2,437 )
Unrealized gain on marketable securities 104
34
Total other comprehensive income (loss) 61
(2,403 )
Comprehensive income 61,610
28,733
Comprehensive income attributable to non-controlling interests (1,072 ) (713 )
Comprehensive income attributable to the Company $ 60,538
$ 28,020
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Unaudited, in thousands)
Common Stock
Number Amount Additional Paid in Capital Accumulated Other Comprehensive Loss Distributions in Excess of Net Income/Loss Non-controlling Interests Total
Beginning balance, January 1, 2015 296,552
$ 2,966
$ 3,223,941
$ (4,435 ) $ (318,762 ) $ 76,593
$ 2,980,303
Common stock dividends ($0.225 per common share)



(67,533 )
(67,533 )
Distributions to non-controlling interests




(1,328 ) (1,328 )
Equity based compensation expense

12,654


297
12,951
Issuance of common stock and OP Units 29

(743 )

765
22
Other comprehensive loss


(2,403 )

(2,403 )
Conversion of Operating Partnership units into common stock 1,903
19
19,601


(19,620 )
Shared-based awards retained for taxes

(430 )


(430 )
Net income



30,423
713
31,136
Ending balance, March 31, 2015 298,484
$ 2,985
$ 3,255,023
$ (6,838 ) $ (355,872 ) $ 57,420
$ 2,952,718
Beginning balance, January 1, 2016 299,138
$ 2,991
$ 3,270,246
$ (2,509 ) $ (400,945 ) $ 50,519
$ 2,920,302
Common stock dividends ($0.245 per common share)



(72,977 )
(72,977 )
Distributions to non-controlling interests




(1,322 ) (1,322 )
Equity based compensation benefit

(1,555 )

(27 ) (1,582 )
Issuance of common stock and OP Units 77
1
(1,407 )

1,616
210
Other comprehensive income


61


61
Shared-based awards retained for taxes

(1,165 )


(1,165 )
Net income



60,477
1,072
61,549
Ending balance, March 31, 2016 299,215
$ 2,992
$ 3,266,119
$ (2,448 ) $ (413,445 ) $ 51,858
$ 2,905,076
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
Three Months Ended March 31,
2016 2015
Operating activities:
Net income $ 61,549
$ 31,136
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 100,479
108,544
Debt premium and discount amortization (4,066 ) (5,048 )
Deferred financing cost amortization 1,937
2,048
Above- and below-market lease intangible amortization (11,018 ) (13,530 )
Provisions for impairment
807
Equity based compensation (1,582 ) 12,951
Other 231
49
Gain on extinguishment of debt, net
(297 )
Changes in operating assets and liabilities:
Restricted cash (2,113 ) (6,845 )
Receivables 10,589
3,675
Deferred charges and prepaid expenses (5,310 ) (2,608 )
Other assets 84
(268 )
Accounts payable, accrued expenses and other liabilities (36,778 ) (17,677 )
Net cash provided by operating activities 114,002
112,937
Investing activities:
Improvements to and investments in real estate assets (36,340 ) (40,411 )
Proceeds from sales of real estate assets
9,918
Change in restricted cash attributable to investing activities (636 ) (1,678 )
Purchase of marketable securities (6,893 ) (4,200 )
Proceeds from sale of marketable securities 6,810
4,499
Net cash used in investing activities (37,059 ) (31,872 )
Financing activities:
Repayment of debt obligations and financing liabilities (4,740 ) (158,568 )
Repayment of borrowings under unsecured revolving credit facility
(682,475 )
Proceeds from borrowings under unsecured revolving credit facility 40,000
163,000
Proceeds from unsecured term loan and notes
695,156
Deferred financing costs
(1,899 )
Distributions to common stockholders (73,447 ) (66,750 )
Distributions to non-controlling interests (1,297 ) (21,611 )
Repurchase of common shares in conjunction with equity award plans (1,165 ) (329 )
Net cash used in financing activities (40,649 ) (73,476 )
Change in cash and cash equivalents 36,294
7,589
Cash and cash equivalents at beginning of period 69,528
60,595
Cash and cash equivalents at end of period $ 105,822
$ 68,184
Supplemental disclosure of cash flow information:
Cash paid for interest, net of amount capitalized of $587 and $656 $ 68,088
$ 61,355
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except unit information)
March 31, 2016 December 31, 2015
Assets
Real estate
Land $ 2,012,905
$ 2,011,947
Buildings and improvements 8,934,306
8,920,903
10,947,211
10,932,850
Accumulated depreciation and amortization (1,957,169 ) (1,880,685 )
Real estate, net 8,990,042
9,052,165
Investments in and advances to unconsolidated joint ventures 5,023
5,019
Cash and cash equivalents 105,786
69,506
Restricted cash 44,211
41,462
Marketable securities 22,951
22,791
Receivables, net of allowance for doubtful accounts of $16,884 and $16,587 169,898
180,486
Deferred charges and prepaid expenses, net 109,813
109,149
Other assets 17,283
17,197
Total assets $ 9,465,007
$ 9,497,775
Liabilities
Debt obligations, net $ 6,007,397
$ 5,974,266
Accounts payable, accrued expenses and other liabilities 552,785
603,439
Total liabilities 6,560,182
6,577,705
Commitments and contingencies (Note 11)



Capital
Partnership common units: 304,601,693 and 304,366,215 units outstanding 2,907,264
2,922,565
Accumulated other comprehensive loss (2,439 ) (2,495 )
Total capital 2,904,825
2,920,070
Total liabilities and capital $ 9,465,007
$ 9,497,775
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per unit data)
Three Months Ended March 31,
2016 2015
Revenues
Rental income $ 251,146
$ 243,570
Expense reimbursements 69,712
69,754
Other revenues 2,246
1,969
Total revenues 323,104
315,293
Operating expenses
Operating costs 35,051
35,160
Real estate taxes 44,391
44,189
Depreciation and amortization 100,479
108,544
Provision for doubtful accounts 2,740
2,495
Impairment of real estate assets
807
General and administrative 20,724
30,715
Total operating expenses 203,385
221,910
Other income (expense)
Dividends and interest 73
94
Interest expense (57,443 ) (62,564 )
Gain on extinguishment of debt, net
292
Other (907 ) (184 )
Total other expense (58,277 ) (62,362 )
Income before equity in income of unconsolidated joint ventures 61,442
31,021
Equity in income of unconsolidated joint ventures 107
115
Net income attributable to Brixmor Operating Partnership LP $ 61,549
$ 31,136
Per common unit:
Income from continuing operations:
Basic $ 0.20
$ 0.10
Diluted $ 0.20
$ 0.10
Net income attributable to partnership common units:
Basic $ 0.20
$ 0.10
Diluted $ 0.20
$ 0.10
Weighted average number of partnership common units:
Basic 304,483
303,131
Diluted 304,682
304,657
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited, in thousands)
Three Months Ended March 31,
2016 2015
Net income $ 61,549
$ 31,136
Other comprehensive income (loss)
Unrealized loss on interest rate hedges (43 ) (2,437 )
Unrealized gain on marketable securities 99
31
Total other comprehensive income (loss) 56
(2,406 )
Comprehensive income attributable to Brixmor Operating Partnership LP $ 61,605
$ 28,730
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN CAPITAL
(Unaudited, in thousands)
Partnership Common Units Accumulated Other Comprehensive Loss Total
Beginning balance, January 1, 2015 $ 2,984,381
$ (4,425 ) $ 2,979,956
Distributions to partners (68,763 )
(68,763 )
Equity based compensation expense 12,951

12,951
Other comprehensive loss
(2,406 ) (2,406 )
Issuance of OP Units 22

22
Share-based awards retained for taxes (430 )
(430 )
Net income 31,136

31,136
Ending balance, March 31, 2015 $ 2,959,297
$ (6,831 ) $ 2,952,466
Beginning balance, January 1, 2016 $ 2,922,565
$ (2,495 ) $ 2,920,070
Distributions to partners (74,313 )
(74,313 )
Equity based compensation benefit (1,582 )
(1,582 )
Other comprehensive income
56
56
Issuance of OP Units 210

210
Share-based awards retained for taxes (1,165 )
(1,165 )
Net income 61,549

61,549
Ending balance, March 31, 2016 $ 2,907,264
$ (2,439 ) $ 2,904,825
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
Three Months Ended March 31,
2016 2015
Operating activities:
Net income $ 61,549
$ 31,136
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 100,479
108,544
Debt premium and discount amortization (4,066 ) (5,048 )
Deferred financing cost amortization 1,937
2,048
Above- and below-market lease intangible amortization (11,018 ) (13,530 )
Provisions for impairment
807
Equity based compensation (1,582 ) 12,951
Other 231
49
Gain on extinguishment of debt, net
(297 )
Changes in operating assets and liabilities:
Restricted cash (2,113 ) (6,845 )
Receivables 10,589
3,675
Deferred charges and prepaid expenses (5,310 ) (2,608 )
Other assets 84
(268 )
Accounts payable, accrued expenses and other liabilities (36,780 ) (17,670 )
Net cash provided by operating activities 114,000
112,944
Investing activities:
Improvements to and investments in real estate assets (36,340 ) (40,411 )
Proceeds from sales of real estate assets
9,918
Change in restricted cash attributable to investing activities (636 ) (1,675 )
Purchase of marketable securities (6,884 ) (4,200 )
Proceeds from sale of marketable securities 6,810
4,499
Net cash used in investing activities (37,050 ) (31,869 )
Financing activities:
Repayment of debt obligations and financing liabilities (4,740 ) (158,568 )
Repayment of borrowings under unsecured revolving credit facility
(682,475 )
Proceeds from borrowings under unsecured revolving credit facility 40,000
163,000
Proceeds from unsecured term loan and notes
695,156
Deferred financing costs
(1,899 )
Partner distributions (75,930 ) (68,722 )
Distributions to non-controlling interests
(19,870 )
Net cash used in financing activities (40,670 ) (73,378 )
Change in cash and cash equivalents 36,280
7,697
Cash and cash equivalents at beginning of period 69,506
60,450
Cash and cash equivalents at end of period $ 105,786
$ 68,147
Supplemental disclosure of cash flow information:
Cash paid for interest, net of amount capitalized of $587 and $656 $ 68,088
$ 61,355
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
March 31, 2016 December 31, 2015
Land $ 2,012,905
$ 2,011,947
Buildings and improvements:
Building 7,359,342
7,359,342
Building and tenant improvements 708,327
683,983
Lease intangibles (1) 866,637
877,578
10,947,211
10,932,850
Accumulated depreciation and amortization (1) (1,957,169 ) (1,880,685 )
Total $ 8,990,042
$ 9,052,165
(1) At March 31, 2016 and December 31, 2015, Lease intangibles consisted of the following: (i) $ 786.9 million and $ 796.8 million , respectively, of in-place lease value, (ii) $ 79.7 million and $ 80.8 million , respectively, of above-market leases, and (iii) $ 615.9 million and $ 606.5 million , respectively, of accumulated amortization. These intangible assets are amortized over the term of each related lease.
Year ending December 31, Above- and below-market lease accretion, net Tenant relationships and leases in place amortization
2016 (remaining nine months) $ (25,207 ) $ 41,111
2017 (29,557 ) 41,560
2018 (26,609 ) 32,252
2019 (22,303 ) 25,428
2020 (17,749 ) 19,160
Fair Value of Derivative Instruments
Interest rate swaps classified as: March 31, 2016 December 31, 2015
Gross derivative assets $
$
Gross derivative liabilities (2,480 ) (2,437 )
Net derivative liability $ (2,480 ) $ (2,437 )
Derivatives in Cash Flow Hedging Relationships (Interest Rate Swaps and Caps) Three Months Ended March 31,
2016 2015
Unrealized loss on interest rate hedges $ (1,529 ) $ (4,901 )
Amortization of interest rate swaps to interest expense $ 1,486
$ 2,464
Carrying Value as of
March 31, 2016 December 31, 2015 Stated Interest Rates Scheduled Maturity Date
Mortgage and secured loans (1)
Fixed rate mortgage and secured loans (2) $ 2,222,023
$ 2,226,763
4.40% - 8.00% 2016 – 2024
Net unamortized premium 36,284
40,508
Net unamortized debt issuance cost (1,380 ) (1,752 )
Total mortgage and secured loans, net $ 2,256,927
$ 2,265,519
Notes payables
Unsecured notes (3) $ 1,218,453
$ 1,218,453
3.85% - 7.97% 2022 - 2029
Net unamortized discount (4,517 ) (4,676 )
Net unamortized debt issuance cost (9,609 ) (9,923 )
Total notes payable, net $ 1,204,327
$ 1,203,854
Unsecured Credit Facility and Term Loan
Unsecured Credit Facility (4) $ 1,956,000
$ 1,916,000
1.90% 2017 – 2018
Unsecured Term Loan 600,000
600,000
1.90% 2019
Net unamortized debt issuance cost (9,857 ) (11,107 )
Total Unsecured Credit Facility and Term Loan $ 2,546,143
$ 2,504,893
Total debt obligations, net $ 6,007,397
$ 5,974,266
(4) The Unsecured Credit Facility (as defined below) consists of a $1.25 billion revolving credit facility and a $1.5 billion term loan facility. The Company has in place five forward starting interest rate swap agreements that convert the floating interest rate on the $1.5 billion term loan facility to a fixed, combined interest rate of 0.844% plus an interest spread of 140 basis points.
Year ending December 31,
2016 (remaining nine months) $ 872,960
2017 805,659
2018 1,519,476
2019 620,126
2020 766,577
Thereafter 1,411,678
Total debt maturities 5,996,476
Net unamortized premiums on mortgages 36,284
Net unamortized discount on notes (4,517 )
Net unamortized debt issuance costs (20,846 )
Total debt obligations $ 6,007,397
March 31, 2016 December 31, 2015
Carrying Amounts Fair Value Carrying Amounts Fair Value
Mortgage and secured loans payable $ 2,256,927
$ 2,363,560
$ 2,265,519
$ 2,367,070
Notes payable 1,204,327
1,160,258
1,203,854
1,198,504
Unsecured credit facility and term loan 2,546,143
2,556,000
2,504,893
2,516,000
Total debt obligations $ 6,007,397
$ 6,079,818
$ 5,974,266
$ 6,081,574
Fair Value Measurements as of March 31, 2016
Balance Quoted Prices in Active markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)
Assets:
Marketable securities (1) $ 23,166
$ 1,236
$ 21,930
$
Liabilities:
Interest rate derivatives $ (2,480 ) $
$ (2,480 ) $
Fair Value Measurements as of December 31, 2015
Balance Quoted Prices in Active markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)
Assets:
Marketable securities (1) $ 23,001
$ 1,167
$ 21,834
$
Liabilities:
Interest rate derivatives $ (2,437 ) $
$ (2,437 ) $
Three Months Ended March 31,
2016 2015
Computation of Basic Earnings Per Share:
Net income $ 61,549
$ 31,136
Income attributable to non-controlling interests (1,072 ) (713 )
Non-forfeitable dividends on unvested restricted shares (15 ) (4 )
Net income attributable to the Company’s common stockholders for basic earnings per share $ 60,462
$ 30,419
Weighted average number shares outstanding - basic 299,180
296,189
Basic Earnings Per Share Attributable to the Company’s Common Stockholders:
Net income $ 0.20
$ 0.10
Computation of Diluted Earnings Per Share:
Net income attributable to the Company’s common stockholders for diluted earnings per share $ 60,462
$ 30,419
Weighted average shares outstanding - basic 299,180
296,189
Effect of dilutive securities:
Equity awards 199
1,526
Weighted average shares outstanding - diluted (1) 299,379
297,715
Diluted Earnings Per Share Attributable to the Company’s Common Stockholders:
Net income $ 0.20
$ 0.10
Three Months Ended March 31,
2016 2015
Computation of Basic Earnings Per Unit:
Net income $ 61,549
$ 31,136
Non-forfeitable dividends on unvested restricted shares (15 ) (4 )
Net income attributable to the Operating Partnership’s common units for basic earnings per unit $ 61,534
$ 31,132
Weighted average number of common units outstanding - basic 304,483
303,131
Basic Earnings Per Unit Attributable to the Operating Partnership’s Common Units:
Net Income $ 0.20
$ 0.10
Computation of Diluted Earnings Per Unit:
Net income attributable to the Operating Partnership’s common units for diluted earnings per unit $ 61,534
$ 31,132
Weighted average common units outstanding - basic 304,483
303,131
Effect of dilutive securities:
Equity awards 199
1,526
Weighted average common units outstanding - diluted 304,682
304,657
Diluted Earnings Per Unit Attributable to the Operating Partnership’s Common Units:
Net Income $ 0.20
$ 0.10
Year ending December 31,
2016 (remaining nine months) $ 5,353
2017 6,625
2018 6,208
2019 6,056
2020 5,242
Thereafter 81,710
Total minimum annual rental commitments $ 111,194
Expansive Retailer Relationships - We believe that given the scale of our asset base and our nationwide footprint, we have a competitive advantage in supporting the growth plans of the nation’s largest retailers. We believe that we are the largest landlord by gross leasable area (“GLA”) to Kroger and TJX Companies, as well as a key landlord to all major grocers and most major retail category leaders. We believe that our strong relationships with leading retailers affords us insight into their strategies and priority access to their expansion plans, enabling us to efficiently provide these retailers with space in multiple locations.
Fully-Integrated Operating Platform - We operate with a fully-integrated, comprehensive platform both leveraging our national presence and demonstrating our commitment to a regional and local presence. We provide our tenants with personalized service through our network of three regional offices in Atlanta, Chicago and Philadelphia, as well as via 12 leasing and property management satellite offices throughout the country. We believe that this strategy enables us to obtain critical market intelligence and to benefit from the regional and local expertise of our workforce.
During the three months ended March 31, 2016, we executed 497 leases in our Portfolio totaling 3.6 million square feet of GLA, including 169 new leases totaling 0.9 million square feet of GLA and 328 renewals totaling 2.7 million square feet of GLA. The average annualized cash base rent (“ABR”) under the new leases increased 34.9% from the prior tenant’s ABR and increased 10.9% for both new and renewal leases on comparable space from the ABR under the prior leases. The average ABR per leased square foot of these new leases in our Portfolio is $14.88 and the average ABR per leased square foot of these new and renewal leases in our Portfolio is $13.35. The average cost per square foot for tenant improvements and leasing commissions for new leases was $21.46 and $2.58, respectively. The average cost per square foot for tenant improvements and leasing commissions for renewal leases was $0.16 and $0.05, respectively.
Three Months Ended March 31,
2016 2015 $ Change
Revenues
Rental income $ 251,146
$ 243,570
$ 7,576
Expense reimbursements 69,712
69,754
(42 )
Other revenues 2,246
1,969
277
Total revenues $ 323,104
$ 315,293
$ 7,811
Three Months Ended March 31,
2016 2015 $ Change
Operating expenses
Operating costs $ 35,051
$ 35,160
$ (109 )
Real estate taxes 44,391
44,189
202
Depreciation and amortization 100,479
108,544
(8,065 )
Provision for doubtful accounts 2,740
2,495
245
Impairment of real estate assets
807
(807 )
General and administrative 20,724
30,715
(9,991 )
Total operating expenses $ 203,385
$ 221,910
$ (18,525 )
Three Months Ended March 31,
2016 2015 $ Change
Other income (expense)
Dividends and interest $ 73
$ 94
$ (21 )
Interest expense (57,443 ) (62,564 ) 5,121
Gain (loss) on extinguishment of debt, net
292
(292 )
Other (907 ) (184 ) (723 )
Total other income (expense) $ (58,277 ) $ (62,362 ) $ 4,085
Three Months Ended March 31,
2016 2015 $ Change
Equity in income of unconsolidated joint ventures $ 107
$ 115
$ (8 )
Three Months Ended March 31,
2016 2015
Cash flows provided by operating activities $ 114,002
$ 112,937
Cash flows used in investing activities $ (37,059 ) $ (31,872 )
Cash flows used in financing activities $ (40,649 ) $ (73,476 )
Three Months Ended March 31,
2016 2015
Cash flows provided by operating activities $ 114,000
$ 112,944
Cash flows used in investing activities $ (37,050 ) $ (31,869 )
Cash flows used in financing activities $ (40,670 ) $ (73,378 )
As of March 31, 2016
Total Projects Anticipated Cost Cost Incurred
Anchor space repositioning 27
$ 111,863
$ 40,419
Redevelopment 1
7,166
471
Outparcel development 10
18,661
7,954
New development 1
19,229
3,845
Total 39
$ 156,919
$ 52,689
Contractual Obligations Payment due by period
(in thousands) 2016 (Remaining Nine Months) 2017 2018 2019 2020 Thereafter Total
Debt (1) $ 872,960
$ 805,659
$ 1,519,476
$ 620,126
$ 766,577
$ 1,411,678
$ 5,996,476
Interest payments (2) 163,198
175,126
140,509
110,768
94,206
171,596
855,403
Operating leases 5,353
6,625
6,208
6,056
5,242
81,710
111,194
Total $ 1,041,511
$ 987,410
$ 1,666,193
$ 736,950
$ 866,025
$ 1,664,984
$ 6,963,073
(2) We incur variable rate interest on $1.9 billion and $600.0 million of debt related to the Unsecured Credit Facility and Term Loan, respectively. The margin associated with Unsecured Credit Facility borrowings is based on a total leverage based grid and ranges from 0.40% to 1.00%, for base rate loans, and 1.40% to 2.00%, for LIBOR rate loans. The margin on the Unsecured Credit Facility was 1.40% and the all-in rate was 1.90% as of March 31, 2016. The Company has in place five forward starting interest rate swap agreements that convert the floating interest rate on $1.5 billion of the Unsecured Credit Facility to a fixed, combined interest rate of 0.844% plus an interest spread of 140 basis points. The margin associated with the Term Loan is based on a total leverage based grid and ranges from 0.35% to 0.75%, for base rate loans, and 1.35% to 1.75% for LIBOR rate loans. The margin on the Term Loan was 1.40% and the all-in rate was 1.90% as of March 31, 2016.
Three Months Ended March 31,
2016 2015
Net income $ 61,549
$ 31,136
Depreciation and amortization-real estate related-continuing operations 99,685
107,190
Depreciation and amortization-real estate related-unconsolidated joint ventures 25
22
Impairment of operating properties
807
NAREIT FFO 161,259
139,155
NAREIT FFO per share/OP Unit - diluted $ 0.53
$ 0.46
Weighted average shares/OP Units outstanding - basic and diluted (1) 304,682
304,670
Incorporated by Reference
Exhibit Number Exhibit Description Form File No. Date of Filing Exhibit Number Filed Herewith
10.1 Separation Agreement and Release, dated February 7, 2016 by and between Brixmor Property Group Inc. and Michael A. Carroll 8-K 001-36160 2/8/2016 10.1
10.2 Separation Agreement and Release, dated February 5, 2016 by and between Brixmor Property Group Inc. and Michael V. Pappagallo 8-K 001-36160 2/8/2016 10.2
10.3 Separation Agreement and release, dated February 7, 2016 by and between Brixmor Property Group Inc. and Steven A. Splain 8-K 001-36160 2/16/2016 10.3
10.4 Employment Agreement, dated February 12, 2016 by and between Brixmor Property Group Inc. and Daniel B. Hurwitz 8-K 001-36160 2/16/2016 10.2
10.5 Employment Agreement, dated February 12, 2016, by and between Brixmor Property Group Inc. and Barry Lefkowitz 8-K 001-36160 2/16/2016 10.1
10.6 Form of Restricted Stock Unit Agreement x
31.1 Brixmor Property Group Inc. Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 x
31.2 Brixmor Property Group Inc. Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 x
31.3 Brixmor Operating Partnership LP Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 x
31.4 Brixmor Operating Partnership LP Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 x
32.1 Brixmor Property Group Inc. Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 x
Incorporated by Reference
Exhibit Number Exhibit Description Form File No. Date of Filing Exhibit Number Filed Herewith
32.2 Brixmor Operating Partnership LP Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 x
99.1 Section 13(r) Disclosure x
101.INS XBRL Instance Document x
101.SCH XBRL Taxonomy Extension Schema Document x
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document x
101.DEF XBRL Taxonomy Extension Definition Linkbase Document x
101.LAB XBRL Taxonomy Extension Label Linkbase Document x
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document x
BRIXMOR PROPERTY GROUP INC.
Date: April 26, 2016 By: /s/Daniel B. Hurwitz
Daniel B. Hurwitz
Interim Chief Executive Officer and President
(Principal Executive Officer)
Date: April 26, 2016 By: /s/Barry Lefkowitz
Barry Lefkowitz
Interim Chief Financial Officer
(Principal Financial Officer)
Date: April 26, 2016 By: /s/Michael Cathers
Michael Cathers
Interim Chief Accounting Officer
(Principal Accounting Officer)
BRIXMOR OPERATING PARTNERSHIP LP
Date: April 26, 2016 By: /s/Daniel B. Hurwitz
Daniel B. Hurwitz
Interim Chief Executive Officer and President
(Principal Executive Officer)
Date: April 26, 2016 By: /s/Barry Lefkowitz
Barry Lefkowitz
Interim Chief Financial Officer
(Principal Financial Officer)
Date: April 26, 2016 By: /s/Michael Cathers
Michael Cathers
Interim Chief Accounting Officer
(Principal Accounting Officer)

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