UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
June 27, 2014
REXFORD INDUSTRIAL REALTY, INC.
(Exact name of registrant as specified in its charter)
|
Maryland |
001-36008 |
46-2024407 |
|
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
|
11620 Wilshire Boulevard, Suite 1000, Los Angeles, California |
90025 |
|
|
(Address of principal executive offices) |
(Zip Code) |
|
Registrant’s telephone number, including area code: (310) 966-1680
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2.):
|
¨ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
¨ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
¨ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
¨ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
This Form 8-K/A amends and supplements the registrant’s Form 8-K, filed on June 30, 2014 reporting the acquisition of an industrial portfolio (the “Portfolio”) consisting of nine properties acquired from a single-seller (the “Original Filing”), to include the historical financial statements and pro forma information required by Item 9.01(a) and (b) of Form 8-K. This Form 8-K/A should be read in conjunction with the Original Filing.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
|
(a) |
|
Financial Statements of the Portfolio Under Rule 3-14 of Regulation S-X |
|
|
|
|
|
Report of Independent Auditors |
|
3 |
|
|
|
Statements of Revenues and Certain Expenses for the three months ended March 31, 2014 (unaudited) and the year ended December 31, 2013 |
|
4 |
|
|
|
Notes to the Statements of Revenues and Certain Expenses |
|
5 |
|
|
|
|
|
|
|
(b) |
|
Unaudited Pro Forma Condensed Consolidated Information. |
|
|
|
|
|
Unaudited Pro Forma Condensed Consolidated Balance Sheet as of March 31, 2014 |
|
8 |
|
|
|
Unaudited Pro Forma Condensed Consolidated Statement of Operations for the three months ended March 31, 2014 |
|
9 |
|
|
|
Unaudited Pro Forma Condensed Consolidated Statement of Operations for the year ended December 31, 2013 |
|
10 |
|
|
|
Notes to the Unaudited Condensed Consolidated Financial Statements |
|
11 |
|
|
|
|
|
|
|
(c) |
|
Exhibits. |
|
|
|
|
|
|
|
|
|
23.1* |
|
Consent of Ernst & Young LLP |
|
|
|
|
|
*Filed herewith |
|
|
Report of Independent Auditors
The Board of Directors and Stockholders of Rexford Industrial Realty, Inc.
We have audited the accompanying statement of revenues and certain expenses (“the financial statement”) of the nine-property industrial portfolio (“the Portfolio”) for the year ended December 31, 2013, and the related notes to the financial statement.
Management’s Responsibility for the Financial Statement
Management is responsible for the preparation and fair presentation of the financial statement in conformity with U.S. generally accepted accounting principles; this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statement that are free of material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial statement based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statement. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statement, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statement in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates, made by management, as well as evaluating the overall presentation of the financial statement.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the statement of revenues and certain expenses referred to above presents fairly, in all material respects, the revenues and certain expenses as described in Note 1 of the Portfolio’s financial statement for the year ended December 31, 2013, in conformity with U.S. generally accepted accounting principles.
Basis of Accounting
As described in Note 1 to the financial statement, the statement of revenues and certain expenses was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission, and is not intended to be a complete presentation of the Portfolio’s revenues and expenses. Our opinion is not modified with respect to this matter.
/s/ Ernst & Young LLP
San Diego, California
July 30, 2014
3
PORTFOLIO
STATEMENT OF REVENUES AND CERTAIN EXPENSES
THREE-MONTHS ENDED MARCH 31, 2014 (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2013
(in thousands)
|
|
|
Three Months Ended March 31, 2014 (Unaudited) |
|
|
Year Ended December 31, 2013 |
|
||
|
RENTAL REVENUES |
|
|
|
|
|
|
|
|
|
Rental revenues |
|
$ |
1,315 |
|
|
$ |
6,374 |
|
|
Tenant reimbursements |
|
|
370 |
|
|
|
1,561 |
|
|
TOTAL RENTAL REVENUES |
|
|
1,685 |
|
|
|
7,935 |
|
|
CERTAIN OPERATING EXPENSES |
|
|
|
|
|
|
|
|
|
Property expenses |
|
|
410 |
|
|
|
1,686 |
|
|
TOTAL OPERATING EXPENSES |
|
|
410 |
|
|
|
1,686 |
|
|
REVENUES IN EXCESS OF CERTAIN OPERATING EXPENSES |
|
$ |
1,275 |
|
|
$ |
6,249 |
|
4
PORTFOLIO
NOTES TO THE STATEMENT OF REVENUES AND CERTAIN EXPENSES
(in thousands)
|
1. |
BACKGROUND AND BASIS OF PRESENTATION |
The accompanying statements of revenues and certain expenses present the results of operations of an industrial portfolio consisting of nine properties (the “Portfolio”) for the three months ended March 31, 2014 (unaudited) and the year ended December 31, 2013. The Portfolio was acquired by Rexford Industrial Realty, Inc., through its operating partnership, Rexford Industrial Realty, L.P. from a third-party seller on June 27, 2014 for approximately $88.5 million. The table below sets forth relevant information with respect to the properties in the Portfolio at the time of acquisition (unaudited).
|
Property Address |
|
City |
|
Number of Buildings |
|
Asset Type |
|
Year Built |
|
Rentable Square Feet |
|
|
Number of Leases |
|
Occupancy |
|
||
|
14955-14971 E Salt Lake Ave. |
|
Industry |
|
1 |
|
Warehouse / Distribution / Manufacturing |
|
1979 |
|
|
126,036 |
|
|
4 |
|
|
100 |
% |
|
3880 W. Valley Blvd. |
|
Pomona |
|
1 |
|
Manufacturing |
|
1980 |
|
|
108,703 |
|
|
1 |
|
|
100 |
% |
|
5235 E. Hunter Ave. |
|
Anaheim |
|
1 |
|
Manufacturing / Office |
|
1987 |
|
|
119,692 |
|
|
3 |
|
|
100 |
% |
|
9340 Cabot Drive |
|
San Diego |
|
1 |
|
Manufacturing / Distribution |
|
1975/6 |
|
|
86,564 |
|
|
2 |
|
|
84 |
% |
|
9404 Cabot Drive |
|
San Diego |
|
1 |
|
Distribution |
|
1975/6 |
|
|
46,846 |
|
|
1 |
|
|
100 |
% |
|
9455 Cabot Drive |
|
San Diego |
|
1 |
|
Distribution |
|
1975/6 |
|
|
96,840 |
|
|
1 |
|
|
84 |
% |
|
9755 Distribution Ave. |
|
San Diego |
|
1 |
|
Warehouse / Distribution |
|
1974 |
|
|
47,666 |
|
|
2 |
|
|
100 |
% |
|
9855 Distribution Ave. |
|
San Diego |
|
1 |
|
Warehouse / Distribution |
|
1983 |
|
|
60,819 |
|
|
2 |
|
|
100 |
% |
|
1601 Alton Parkway |
|
Irvine |
|
1 |
|
R&D/Manufacturing |
|
1974 |
|
|
124,000 |
|
|
1 |
|
|
40 |
% |
|
|
|
|
|
9 |
|
|
|
|
|
|
817,166 |
|
|
17 |
|
|
87 |
% |
The accompanying statements of revenues and certain expenses have been prepared for the purpose of complying with Rule 3-14 of Regulation S-X promulgated under the Securities Act of 1933, as amended. Accordingly, the statements are not representative of the actual operations for the periods presented as revenues and certain operating expenses, which may not be directly attributable to the revenues and expenses expected to be incurred through the future operations of the Portfolio, have been excluded. Such items include depreciation, amortization, interest expense, interest income, management fee expense, and amortization of above and below market leases.
2. SIGNIFICANT ACCOUNTING POLICES
Revenue Recognition
The Portfolio recognizes rental revenue from tenants on a straight-line basis over the lease term when collectability is reasonably assured and the tenant has taken possession or controls the physical use of the leased asset.
5
PORTFOLIO
NOTES TO THE STATEMENT OF REVENUES AND CERTAIN EXPENSES
(in thousands)
Tenant reimbursements related to reimbursement of real estate taxes, insurance, repairs and maintenance, and other operating expenses are recognized as revenue in the period the applicable expenses are incurred. The reimbursements are recognized and presented gross, as the Portfolio is generally the primary obligor with respect to purchasing goods and services from third-party suppliers, has discretion in selecting the supplier and bears the associated credit risk.
Use of Estimates
A number of estimates and assumptions have been made relating to the reporting and disclosure of revenues and certain expenses during the reporting period to prepare the statement of revenues and certain expenses in conformity with U.S. generally accepted accounting principles. Actual results could differ from those estimates.
3.MINIMUM FUTURE LEASE RENTALS
There are various lease agreements in place with tenants to lease space in the Portfolio. As of March 31, 2014, the minimum future cash rents receivable under non-cancelable operating leases in each of the next five years and thereafter are as follows (unaudited and in thousands):
|
Years Ending December 31 |
|
|
|
|
|
2014 |
|
$ |
4,002 |
|
|
2015 |
|
|
5,042 |
|
|
2016 |
|
|
3,983 |
|
|
2017 |
|
|
1,564 |
|
|
2018 |
|
|
1,134 |
|
|
Thereafter |
|
|
1,270 |
|
|
Total |
|
$ |
16,995 |
|
Leases generally require reimbursement of the tenant's proportional share of common area, real estate taxes and other operating expenses, which are excluded from the amounts above.
4. TENANT CONCENTRATIONS
For the three months ended March 31, 2014 and the year ended December 31, 2013, three tenants represented 36% and 36%, respectively, of the Portfolio’s rental revenue.
5. COMMITMENTS AND CONTINGENCIES
The Portfolio is subject to various legal proceedings and claims that arise in the ordinary course of business. These matters are generally covered by insurance and the ultimate settlement of these actions will not have a material adverse effect on the Portfolio’s results of operations.
6. SUBSEQUENT EVENTS
Subsequent events were evaluated through July 30, 2014, the date the financial statements were available to be issued.
6
REXFORD INDUSTRIAL REALTY, INC.
UNAUDITED PRO FORMA FINANCIAL INFORMATION
The unaudited pro forma condensed consolidated balance sheet as of March 31, 2014 is based on Rexford Industrial Realty, Inc.’s (the “Company”) historical consolidated balance sheet and reflects the subsequent acquisition of a nine property industrial portfolio from a single seller (the “Portfolio”) and the related borrowings on the revolving credit facility and the term loan as if such transactions had occurred on March 31, 2014. The unaudited pro forma condensed consolidated statements of operations for the three months ended March 31, 2014 and the year ended December 31, 2013 are based on the Company’s and to the extent applicable, its Predecessor’s, historical statements of operations and have been prepared to reflect the incremental effect of the Company’s initial public offering on July 24, 2013 and the Company’s acquisition of the Portfolio as if such transactions had occurred on January 1, 2013.
The unaudited pro forma financial information is not necessarily indicative of what the Company’s results of operations or financial condition would have been assuming the Company’s initial public offering and acquisition of the Portfolio had occurred at the beginning of the periods presented, nor is it indicative of the Company’s results of operations or financial condition for future periods. In management’s opinion, all adjustments necessary to reflect the effects of these transactions have been made. The unaudited pro forma condensed consolidated financial information and accompanying notes should be read in conjunction with the Company’s financial statements included on Form 10-K for the year ended December 31, 2013 and Quarterly Report on Form 10-Q for the three months ended March 31, 2014.
7
REXFORD INDUSTRIAL REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
As of March 31, 2014
(in thousands – except share and per share data)
(Unaudited)
|
|
|
Rexford Industrial Realty, Inc. (A) |
|
|
Acquisition of Portfolio (B) |
|
|
Pro Forma Rexford Industrial Realty, Inc. |
|
|||
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in real estate, net |
|
|
512,573 |
|
|
|
82,173 |
|
|
|
594,746 |
|
|
Cash and cash equivalents |
|
|
6,344 |
|
|
|
(841 |
) |
|
|
5,503 |
|
|
Restricted cash |
|
|
352 |
|
|
|
- |
|
|
|
352 |
|
|
Notes receivable |
|
|
13,135 |
|
|
|
- |
|
|
|
13,135 |
|
|
Rents and other receivables, net |
|
|
1,254 |
|
|
|
- |
|
|
|
1,254 |
|
|
Deferred rent receivable, net |
|
|
3,817 |
|
|
|
- |
|
|
|
3,817 |
|
|
Deferred leasing costs, net |
|
|
2,303 |
|
|
|
- |
|
|
|
2,303 |
|
|
Deferred loan costs, net |
|
|
1,476 |
|
|
|
392 |
|
|
|
1,868 |
|
|
Acquired lease intangible assets, net |
|
|
13,174 |
|
|
|
6,522 |
|
|
|
19,696 |
|
|
Acquired indefinite-lived intangible |
|
|
5,271 |
|
|
|
- |
|
|
|
5,271 |
|
|
Other assets |
|
|
4,588 |
|
|
|
119 |
|
|
|
4,707 |
|
|
Acquisition related deposits |
|
|
1,550 |
|
|
|
- |
|
|
|
1,550 |
|
|
Investment in unconsolidated real estate entities |
|
|
5,778 |
|
|
|
- |
|
|
|
5,778 |
|
|
Total Assets |
|
$ |
571,615 |
|
|
$ |
88,365 |
|
|
$ |
659,980 |
|
|
LIABILITIES & EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes payable |
|
$ |
212,918 |
|
|
$ |
88,000 |
|
|
$ |
300,918 |
|
|
Accounts payable, accrued expenses and other liabilities |
|
|
6,345 |
|
|
|
2 |
|
|
|
6,347 |
|
|
Dividends payable |
|
|
3,066 |
|
|
|
- |
|
|
|
3,066 |
|
|
Acquired lease intangible liabilities, net |
|
|
1,553 |
|
|
|
184 |
|
|
|
1,737 |
|
|
Tenant security deposits |
|
|
6,960 |
|
|
|
355 |
|
|
|
7,315 |
|
|
Prepaid rents |
|
|
778 |
|
|
|
200 |
|
|
|
978 |
|
|
Total Liabilities |
|
|
231,620 |
|
|
|
88,741 |
|
|
|
320,361 |
|
|
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
Rexford Industrial Realty, Inc. stockholders' equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stock, $0.01 par value 490,000,000 authorized and 25,551,204 and 25,559,886 outstanding at March 31, 2014 and December 31, 2013, respectively |
|
|
255 |
|
|
|
- |
|
|
|
255 |
|
|
Additional paid in capital |
|
|
312,131 |
|
|
|
- |
|
|
|
312,131 |
|
|
Accumulated other comprehensive income |
|
|
269 |
|
|
|
- |
|
|
|
269 |
|
|
Accumulated deficit |
|
|
(7,782 |
) |
|
|
(376 |
) |
|
|
(8,158 |
) |
|
Total stockholders' equity |
|
|
304,873 |
|
|
|
(376 |
) |
|
|
304,497 |
|
|
Noncontrolling interests |
|
|
35,122 |
|
|
|
- |
|
|
|
35,122 |
|
|
Total Equity |
|
|
339,995 |
|
|
|
(376 |
) |
|
|
339,619 |
|
|
Total Liabilities and Equity |
|
$ |
571,615 |
|
|
$ |
88,365 |
|
|
$ |
659,980 |
|
8
REXFORD INDUSTRIAL REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the three months ended March 31, 2014
(in thousands – except share and per share data)
(Unaudited)
|
|
|
Rexford Industrial Realty, Inc. (AA) |
|
|
Acquisition of Portfolio (DD) |
|
|
Other Adjustments |
|
|
|
Pro Forma Rexford Industrial Realty, Inc. |
|
||||
|
RENTAL REVENUES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenues |
|
$ |
11,628 |
|
|
$ |
1,235 |
|
|
$ |
- |
|
|
|
$ |
12,863 |
|
|
Tenant reimbursements |
|
|
1,511 |
|
|
|
370 |
|
|
|
- |
|
|
|
|
1,881 |
|
|
Management, leasing and development services |
|
|
234 |
|
|
|
- |
|
|
|
- |
|
|
|
|
234 |
|
|
Other income |
|
|
42 |
|
|
|
- |
|
|
|
- |
|
|
|
|
42 |
|
|
TOTAL RENTAL REVENUES |
|
|
13,415 |
|
|
|
1,605 |
|
|
|
- |
|
|
|
|
15,020 |
|
|
Interest income |
|
|
276 |
|
|
|
- |
|
|
|
- |
|
|
|
|
276 |
|
|
TOTAL REVENUES |
|
|
13,691 |
|
|
|
1,605 |
|
|
|
- |
|
|
|
|
15,296 |
|
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property expenses |
|
|
4,134 |
|
|
|
410 |
|
|
|
75 |
|
(EE) |
|
|
4,619 |
|
|
General and administrative |
|
|
2,605 |
|
|
|
- |
|
|
|
- |
|
|
|
|
2,605 |
|
|
Depreciation and amortization |
|
|
6,130 |
|
|
|
1,125 |
|
|
|
- |
|
|
|
|
7,255 |
|
|
TOTAL OPERATING EXPENSES |
|
|
12,869 |
|
|
|
1,535 |
|
|
|
75 |
|
|
|
|
14,479 |
|
|
OTHER (INCOME) EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition expenses |
|
|
333 |
|
|
|
- |
|
|
|
- |
|
|
|
|
333 |
|
|
Interest expense |
|
|
1,251 |
|
|
|
- |
|
|
|
383 |
|
(FF) |
|
|
1,634 |
|
|
Gain on mark-to-market of interest rate swaps |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
TOTAL OTHER EXPENSE |
|
|
1,584 |
|
|
|
- |
|
|
|
383 |
|
|
|
|
1,967 |
|
|
TOTAL EXPENSES |
|
|
14,453 |
|
|
|
1,535 |
|
|
|
458 |
|
|
|
|
16,446 |
|
|
Equity in income (loss) from unconsolidated real estate entities |
|
|
45 |
|
|
|
- |
|
|
|
- |
|
|
|
|
45 |
|
|
Gain from early repayment of note receivable |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
Loss on extinguishment of debt |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
NET (LOSS) INCOME FROM CONTINUING OPERATIONS |
|
|
(717 |
) |
|
|
70 |
|
|
|
(458 |
) |
|
|
|
(1,105 |
) |
|
Net loss from continuing operations attributable to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
117 |
|
(GG) |
|
|
117 |
|
|
NET LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO REXFORD INDUSTRIAL REALTY, INC. STOCKHOLDERS |
|
$ |
(717 |
) |
|
$ |
70 |
|
|
$ |
(341 |
) |
|
|
$ |
(988 |
) |
|
Loss from continuing operations attributable to common stockholders per share - basic and diluted |
|
$ |
(0.03 |
) |
|
|
|
|
|
|
|
|
|
|
$ |
(0.04 |
) |
|
Weighted average shares of common stock outstanding - basic and diluted |
|
|
25,419,418 |
|
|
|
|
|
|
|
|
|
|
|
|
25,419,418 |
|
9
REXFORD INDUSTRIAL REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the year ended December 31, 2013
(in thousands – except share and per share data)
(Unaudited)
|
|
|
Rexford Industrial Realty, Inc. Predecessor (Period from 1/1/13 -7/23/13) (AA) |
|
|
Rexford Industrial Realty, Inc. (Period from 7/24/13 - 12/31/13) (AA) |
|
|
Contribution of Rexford Sponsor LLC and Rexford Fund V REIT LLC (BB) |
|
|
IPO Financing Transactions (CC) |
|
|
Other Adjustments |
|
|
|
Pro Forma Rexford Industrial Realty, Inc. before Acquisition of Portfolio |
|
|
Acquisition of Portfolio (DD) |
|
|
Other Adjustments |
|
|
|
Pro Forma Rexford Industrial Realty, Inc. |
|
|||||||||
|
RENTAL REVENUES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental revenues |
|
$ |
19,206 |
|
|
$ |
18,449 |
|
|
$ |
(22 |
) |
|
$ |
- |
|
|
$ |
- |
|
|
|
$ |
37,633 |
|
|
$ |
6,055 |
|
|
$ |
- |
|
|
|
$ |
43,688 |
|
|
Tenant reimbursements |
|
|
2,212 |
|
|
|
2,161 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
4,373 |
|
|
|
1,561 |
|
|
|
- |
|
|
|
|
5,934 |
|
|
Management, leasing and development services |
|
|
444 |
|
|
|
534 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
978 |
|
|
|
- |
|
|
|
- |
|
|
|
|
978 |
|
|
Other income |
|
|
187 |
|
|
|
93 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
280 |
|
|
|
- |
|
|
|
- |
|
|
|
|
280 |
|
|
TOTAL RENTAL REVENUES |
|
|
22,049 |
|
|
|
21,237 |
|
|
|
(22 |
) |
|
|
- |
|
|
|
- |
|
|
|
|
43,264 |
|
|
|
7,616 |
|
|
|
- |
|
|
|
|
50,880 |
|
|
Interest income |
|
|
698 |
|
|
|
381 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
1,079 |
|
|
|
- |
|
|
|
- |
|
|
|
|
1,079 |
|
|
TOTAL REVENUES |
|
|
22,747 |
|
|
|
21,618 |
|
|
|
(22 |
) |
|
|
- |
|
|
|
- |
|
|
|
|
44,343 |
|
|
|
7,616 |
|
|
|
- |
|
|
|
|
51,959 |
|
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property expenses |
|
|
5,924 |
|
|
|
6,396 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
12,320 |
|
|
|
1,686 |
|
|
|
298 |
|
(EE) |
|
|
14,304 |
|
|
General and administrative |
|
|
4,420 |
|
|
|
5,327 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
9,747 |
|
|
|
- |
|
|
|
- |
|
|
|
|
9,747 |
|
|
Depreciation and amortization |
|
|
7,022 |
|
|
|
8,686 |
|
|
|
3,090 |
|
|
|
- |
|
|
|
- |
|
|
|
|
18,798 |
|
|
|
4,769 |
|
|
|
- |
|
|
|
|
23,567 |
|
|
TOTAL OPERATING EXPENSES |
|
|
17,366 |
|
|
|
20,409 |
|
|
|
3,090 |
|
|
|
- |
|
|
|
- |
|
|
|
|
40,865 |
|
|
|
6,455 |
|
|
|
298 |
|
|
|
|
47,618 |
|
|
OTHER (INCOME) EXPENSE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition expenses |
|
|
724 |
|
|
|
540 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
1,264 |
|
|
|
- |
|
|
|
- |
|
|
|
|
1,264 |
|
|
Interest expense |
|
|
9,395 |
|
|
|
1,763 |
|
|
|
- |
|
|
|
(7,308 |
) |
|
|
- |
|
|
|
|
3,850 |
|
|
|
- |
|
|
|
1,552 |
|
(FF) |
|
|
5,402 |
|
|
Gain on mark-to-market of interest rate swaps |
|
|
(49 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
(49 |
) |
|
|
- |
|
|
|
- |
|
|
|
|
(49 |
) |
|
TOTAL OTHER EXPENSE |
|
|
10,070 |
|
|
|
2,303 |
|
|
|
- |
|
|
|
(7,308 |
) |
|
|
- |
|
|
|
|
5,065 |
|
|
|
- |
|
|
|
1,552 |
|
|
|
|
6,617 |
|
|
TOTAL EXPENSES |
|
|
27,436 |
|
|
|
22,712 |
|
|
|
3,090 |
|
|
|
(7,308 |
) |
|
|
- |
|
|
|
|
45,930 |
|
|
|
6,455 |
|
|
|
1,850 |
|
|
|
|
54,235 |
|
|
Equity in income (loss) from unconsolidated real estate entities |
|
|
(915 |
) |
|
|
92 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
(823 |
) |
|
|
- |
|
|
|
- |
|
|
|
|
(823 |
) |
|
Gain from early repayment of note receivable |
|
|
1,365 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
1,365 |
|
|
|
- |
|
|
|
- |
|
|
|
|
1,365 |
|
|
Loss on extinguishment of debt |
|
|
(3,955 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
(3,955 |
) |
|
|
- |
|
|
|
- |
|
|
|
|
(3,955 |
) |
|
NET (LOSS) INCOME FROM CONTINUING OPERATIONS |
|
|
(8,194 |
) |
|
|
(1,002 |
) |
|
|
(3,112 |
) |
|
|
7,308 |
|
|
|
- |
|
|
|
|
(5,000 |
) |
|
|
1,161 |
|
|
|
(1,850 |
) |
|
|
|
(5,689 |
) |
|
Net income attributable to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
606 |
|
(FF) |
|
|
606 |
|
|
|
- |
|
|
|
84 |
|
(GG) |
|
|
690 |
|
|
NET INCOME ATTRIBUTABLE TO REXFORD INDUSTRIAL REALTY, INC. STOCKHOLDERS |
|
$ |
(8,194 |
) |
|
$ |
(1,002 |
) |
|
$ |
(3,112 |
) |
|
$ |
7,308 |
|
|
$ |
606 |
|
|
|
$ |
(4,394 |
) |
|
$ |
1,161 |
|
|
$ |
(1,766 |
) |
|
|
$ |
(4,999 |
) |
|
Loss from continuing operations attributable to common stockholders per share - basic and diluted |
|
|
|
|
|
$ |
(0.04 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(0.18 |
) |
|
|
|
|
|
|
|
|
|
|
$ |
(0.20 |
) |
|
Weighted average shares of common stock outstanding - basic and diluted |
|
|
|
|
|
|
24,925,226 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,925,226 |
|
|
|
|
|
|
|
|
|
|
|
|
24,925,226 |
|
10
REXFORD INDUSTRIAL REALTY, INC.
NOTES TO THE PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
|
1. |
Balance sheet adjustments |
|
(A) |
Represents the unaudited historical balance sheet of Rexford Industrial Realty, Inc. (the “Company,” “we,” or “us”) as of March 31, 2014. See the historical consolidated financial statements and notes thereto included in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014. |
|
(B) |
Reflects the acquisition of the nine property industrial portfolio from a single seller (the “Portfolio”) as if it had occurred on March 31, 2014 for approximately $88.5 million. The acquisition was funded by entering into a new $48.5 million term loan and drawing $39.5 million on the Company’s revolving credit facility. The Company incurred $0.4 million in acquisition expenses as part of the acquisition of the Portfolio. |
|
2. |
Income statement adjustments |
|
(AA) |
Represents the unaudited historical consolidated operations of the Company for the three months ended March 31, 2014, the historical consolidated operations of the Company for the period from July 24, 2013 through December 31, 2013, and the combined operations of Rexford Industrial Realty, Inc.’s Predecessor (the “Predecessor”) for the period from January 1, 2013 through July 23, 2013. See the historical consolidated financial statements and notes thereto included in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014 and the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. |
|
(BB) |
Reflects the contribution of Rexford Fund V Sponsor, LLC, Rexford Industrial Fund V REIT, LLC and their controlled subsidiaries in the formation transactions as if this had occurred on January 1, 2013. The contribution of the ownership interests in Rexford Fund V Sponsor, LLC, Rexford Industrial Fund V REIT, LLC and their controlled subsidiaries was accounted for as a business combination in accordance with ASC Section 805-10, Business Combinations, and recorded at the estimated fair value of the acquired assets and assumed liabilities. Adjustments to rental revenues and depreciation and amortization represent the additional depreciation expense and amortization of intangibles as a result of the business combination. |
|
(CC) |
Reflects the proceeds from our initial public offering used to repay approximately $303.3 million of debt secured by the assets of the Predecessor resulting in a decrease in interest expense as if repayment had occurred on January 1, 2013. Additionally, reflects the incremental interest from the $60.0 million term loan and the initial $7.1 million draw on our revolving credit facility made at the time of our initial public offering as if they had occurred on January 1, 2013. The calculation of interest expense relating to our $60.0 million term loan assumes an interest rate of one-month LIBOR plus the applicable LIBOR margin of 1.90%, or currently 2.06 %. The calculation of interest expense relating to our draw on our secured revolving credit facility assumes an interest rate of one-month LIBOR plus the applicable LIBOR margin of 1.55%, or currently 1.71%, and a 0.30% unused line fee. On a pro forma basis, if LIBOR were to increase by 1/8%, interest expense would have increased by and net loss from continuing operations would have increased by $47,000 for the year ended December 31, 2013. Conversely, if LIBOR were to decrease by 1/8%, interest expense would have decreased by and net loss from continuing operations would have decreased by $47,000 for the year ended December 31, 2013. |
11
REXFORD INDUSTRIAL REALTY, INC.
NOTES TO THE PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
|
(DD) |
The pro forma adjustments reflect the results of operations for the three months ended March 31, 2014 and the year ended December 31, 2013 for the Portfolio as if the Portfolio had been acquired on January 1, 2013. Revenues and direct operating expenses are presented on the accrual basis of accounting. Rental revenues include adjustments for the amortization of the net amount of above- and below-market rents. Depreciation and amortization amounts were determined based on management’s evaluation of the estimated useful lives of the properties in the Portfolio and intangibles. In utilizing these useful lives for determining the pro forma adjustments, management considered the length of time the property had been in existence, the maintenance history as well as anticipated future maintenance, and any contractual stipulations that might limit the useful life. |
|
(EE) |
The pro forma adjustments reflect the incremental property tax expense from the anticipated real estate tax reassessment of the Portfolio for the three months ended March 31, 2014 and the year ended December 31, 2014 as if the Portfolio had been acquired on January 1, 2013. |
|
(FF) |
Reflects the adjustment to interest expense as if the $48.5 million term loan at an interest rate of one-month LIBOR plus the applicable LIBOR margin of 1.55% and draws of $39.5 million on the Company’s revolving credit facility at an interest rate of one-month LIBOR plus the applicable LIBOR margin of 1.55% and a 0.30% unused line fee, had occurred on January 1, 2013. On a pro forma basis, if LIBOR were to increase by 1/8%, interest expense would have increased by and net loss from continuing operations would have increased by $27,000 and $110,000 for the three months ended March 31, 2014 and the year ended December 31, 2013, respectively. Conversely, if LIBOR were to decrease by 1/8%, interest expense would have decreased by and net loss from continuing operations would have decreased by $27,000 and $110,000 for the three months ended March 31, 2014 and the year ended December 31, 2013, respectively. |
|
(GG) |
Reflects the pro forma income allocation to unitholders in our operating partnership of the various adjustments noted in (AA), (BB), (CC), (DD) and (EE) above, for the three months ended March 31, 2014 and the year ended December 31, 2013. |
12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
|
|
|
|
|
|
|
Rexford Industrial Realty, Inc. |
|
|
|
|
July 31, 2014 |
/s/ Michael S. Frankel |
|
|
Michael S. Frankel |
|
|
|
|
|
Rexford Industrial Realty, Inc. |
|
|
|
|
July 31, 2014 |
/s/ Howard Schwimmer |
|
|
Howard Schwimmer |
.
EXHIBIT INDEX
|
|
|
|
|
Exhibit Number |
|
Description |
|
|
|
|
|
23.1 |
|
Consent of Ernst & Young, LLP |