Brandywine Realty Belief Publicizes First Quarter Outcomes and Narrows 2021 Steering NYSE: BDN

PHILADELPHIA, April 21, 2021 (GLOBE NEWSWIRE) – The Brandywine Realty Trust (NYSE: BDN) today released its financial and operating results for the three months ended March 31, 2021.

Management comments

“With the accelerated availability of vaccinations and the easing of government restrictions, we are pleased to see more and more of our tenants returning to work. As the transition continues, we will continue to prioritize the safety of our employees, tenants and stakeholders, ”said Gerard H. Sweeney, President and Chief Executive Officer of Brandywine Realty Trust. “We are making excellent progress with our business plan 2021. Based on the middle of our range, we have now achieved 91% of our speculative sales target and continue to record positive market value rents, which increase by 8.3% and 5.0% on the accrual and cash basis. While our first quarter net operating income and market value rents were below our 2021 business plan areas, this performance was expected for the first quarter. On the basis of the currently executed leasing contracts and future leasing activities, we will achieve our business plan areas. Our balance sheet and liquidity remained strong during the quarter. We continued to make excellent progress on our life science and other development initiatives. Based on our progress in the first quarter, we're reducing our FFO forecast for 2021 from $ 1.32 to $ 1.42 per share to $ 1.33 to $ 1.41 per share. "

Highlights of the first quarter of 2021

Financial results

  • Net income for the year allocated to ordinary shareholders; $ 6.8 million, or $ 0.04 per diluted share.
  • Funds from Operations (FFO); $ 60.2 million, or $ 0.35 per diluted share.

Portfolio results

  • Core portfolio: 90.3% occupied and 92.5% rented.
  • New and Renewal Contracts Signed: 493,251 square feet.
  • Tenant retention rate: 52%.
  • The market valuation of rents rose by 8.3% in the period and by 5.0% in cash.
  • Same operating profit of the business: (0.9%) accrual and (1.4%) cash.

COVID-19 update

We continue to monitor events related to COVID-19 and are taking steps to reduce the risks to Brandywine and our tenants. Although the duration and economic impact of the COVID-19 pandemic are unknown, we believe that at the time of this press release, our business plan and earnings estimates for 2021 take into account the impact of COVID-19. We are continuously evaluating the ongoing impact of the pandemic on our business plan, our tenants and our profit estimates.

The following is a summary of our consolidated cash base rent collections for the first quarter ended April 19, 2021:

  • 98.9% of the total cash payment due was received from our tenants in the first quarter of 2021, which corresponds to a collection rate of 99.1% from our office tenants.
  • A large part of the rental income in the form of rent deferrals is to be repaid by the end of 2021.
  • We collected 41% of the rental deferrals that were not provided as free rent with an associated lease extension.

Transaction activity

Joint venture activity

  • As previously announced, on February 2, 2021, we formed a joint venture with a global institutional investor to begin development on 3025 JFK Boulevard, also known as Schuylkill Yards West, in Philadelphia, Pennsylvania. The estimated cost of the project is approximately $ 287 million and the joint venture partner has agreed to fund up to approximately $ 45 million of the project cost in exchange for a 45% preferential interest in the company. We are in the process of obtaining a total home loan of approximately $ 187 million, or 65% of the total project cost. The loan is expected to close in the second quarter of 2021. We started construction in March 2021. Completion is expected in the third quarter of 2023. The project is the first fundamental development in our development planned by Schuylkill Yards. The 29-story building will consist of 326 luxury rental apartments, 200,000 square feet of life science / innovation office space, 29,000 square feet of interior / exterior, 9,000 square feet of retail space and 115 underground parking spaces. The project was designed by Practice for Architecture and Urbanism.

Development / renovation activities

  • In March 2021, Brandywine was selected by the Terrapin Development Company and the University of Maryland to be the exclusive developer of a mixed-use neighborhood that spans five acres within the University of Maryland's Discovery District. The project will consist of 550,000 square meters of innovative Class A workspaces for research and life sciences and 200 to 250 apartment blocks. The planning and approval process is ongoing with construction expected to start in the first phase for the second half of 2022, subject to pre-letting and market conditions.
  • In March 2021, we entered into an agreement with the Pennsylvania Biotechnology Center to create B.Labs, a life science incubator at the Cira Center adjacent to the Schuylkill Yards neighborhood in the University City neighborhood of Philadelphia, Pennsylvania. We assume that we will open the first 50,000 square meters of plug & play laboratory and research space in the fourth quarter of 2021.

2021 financial activity

  • As of March 31, 2021, there was $ 13.0 million outstanding on our unsecured revolving credit facility of $ 600.0 million.
  • As of March 31, 2021, we had cash and cash equivalents of $ 45.7 million.

Results for the three months ended March 31, 2021

Net income allocated to common stock was $ 6.8 million, or $ 0.04 per diluted share, for the first quarter of 2021, compared to a net income allocated to common stock of $ 7.9 million, or $ 0.04 per diluted share in the first quarter of 2020.

FFO available to common stock and shares in the first quarter of 2021 was $ 60.2 million, or $ 0.35 per diluted share, compared to $ 61.4 million, or $ 0.35 per diluted share, in the first quarter 2020. Our payout ratio for the first quarter of 2021 ($ 0.19 common stock payout / $ 0.35 FFO per diluted share) was 54.3%.

Operating and leasing activities

In the first quarter of 2021, our net operating income (NOI) excluding termination revenues and other income items decreased on an accrual basis (0.9%) and on a cash basis (1.5%) for our 73 identical store properties (90.1%). and 93.0% occupied on March 31, 2021 and March 31, 2020, respectively.

We rented approximately 493,000 square feet and started occupying 196,000 square feet in the first quarter of 2021. Occupancy activity in the first quarter includes renewals to 167,000 square feet, 9,000 square feet of new leases, and tenant expansions to 20,000 square feet. We have signed an additional 282,000 square meters of new leases that are scheduled to begin after March 31, 2021.

We achieved a tenant retention rate of 52% in our core portfolio with a negative absorption of (165,000) square feet in the first quarter of 2021. However, we returned 119,000 square feet, or 72% of the negative absorption at 19% cash mark-to-market. Rental rate growth in the first quarter increased 8.3% as our renewal rental rates increased 8.7% and our new rental / expansion rental rates increased 8.2%, all on an accrual basis.

As of March 31, 2021, our core portfolio of 76 properties with an area of ​​12.9 million square meters was 90.3% occupied, and as of April 17, 2021 we are now 92.5% let (which is due to new leases, starting after March 31, 2021).


On February 24, 2021, our Board of Trustees declared a quarterly cash dividend of $ 0.19 per common share per OP Unit, which was paid on April 21, 2021 to the registered holders on April 7, 2021.

2021 result and FFO guidance

Based on current plans and assumptions, and subject to the risks and uncertainties detailed in our filings with the Securities and Exchange Commission, we are adjusting our forecast for earnings per share for 2021 from $ 0.32 to $ 0.42 to $ 0.28 up to $ 0.36 per diluted share and 2021 FFO forecast of $ 1.32 – $ 1.42 to $ 1.33 – $ 1.41 per diluted share. These instructions are provided for informational purposes and are subject to change. The following is a reconciliation of the calculation of FFO 2021 and earnings per diluted share:

Instructions for 2021 Range
Earnings per diluted share allocated to ordinary shareholders $0.28 to $0.36
Plus: property depreciation, amortization 1.05 1.05
FFO per diluted share $1.33 to $1.41

Our key FFO assumptions for 2021 include:

  • Core occupancy range at the end of the year: 91-93%;
  • Core lease range at the end of the year: 92-94%;
  • Mark-to-market rental price (provision): 14-16%;
  • Mark-to-Market Rental Rate (Cash): 8-10%;
  • NOI range of the same business (delimitation): 0-2%;
  • NOI range in the same store (cash): 3-5%;
  • Speculative Income Range: $ 18.0 – 22.0 million, reached $ 18.1 million;
  • Tenant retention rate range: 51-53%;
  • Real estate employment: none;
  • Real estate sales activity: None;
  • Development / renovation starts: Two starts; a start began, Schuylkill Yards West;
  • Adjustments to the core and same business portfolio: effective January 1, 2021, we removed 2340 Dulles (included in the redevelopment), and effective January 1, 2021, 905, Broadmoor was removed from our same business portfolio of the first quarter and thereafter decommissioned as part of our Broadmoor master plan;
  • Financing activity: none;
  • Share buyback activity: None;
  • Net income and FFO per diluted share based on 173.0 million fully diluted weighted average common shares.

About Brandywine Realty Trust

Brandywine Realty Trust (NYSE: BDN) is one of the largest publicly traded, full-service integrated real estate companies in the United States, focusing on the Philadelphia, Austin, and Washington, DC markets. As a Real Estate Investment Trust (REIT), we are organizing, owning, developing, leasing, and managing an urban, city-center, transit-oriented portfolio of 174 properties and 24.5 million square feet that excludes the assets for sale as of March 31, 2021. Our goal is to shape, connect and inspire the world around us through our expertise, the relationships we have, the communities we live and work in and the history we build together. More information is available at

Conference call and audio webcast

We will host our conference call for the first quarter on Thursday, April 22, 2021 at 9:00 a.m. Eastern. The conference call can be accessed by dialing 1-833-818-6810 and providing the conference ID: 2956876. From two hours after the conference call until Friday, May 7, 2021, a telephone recording of the call can be accessed by dialing 1 -855-859-2056 and entering the access code 2956876. The conference call can also be accessed via a webcast on our website at can be accessed

Looking ahead – conference call for the second quarter of 2021

We expect to post our earnings for the second quarter of 2021 on Monday, July 26, 2021 after the market closes, and will be our conference call for the second on Tuesday, July 27, 2021 at 9:00 a.m. Eastern Held in the first quarter of 2021. We expect to issue a press release prior to these events to reconfirm the date and time and to provide all related information.

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. Such forward-looking statements can generally be identified by the use of forward-looking terms such as “will,” “strategy,” “expectation,” “search,” “belief,” “potential,” or other similar words. Because such statements involve known and unknown risks, uncertainties and contingencies, actual results could differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. These forward-looking statements, including our guidance for 2021, are based on the current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond our control. These risks, uncertainties and contingent liabilities include, but are not limited to: Risks related to the effects of COVID-19 and other potential future infectious disease outbreaks on our financial condition, results of operations, and those of our tenants and the economy, real estate and financial markets; lower demand for office space and price pressures, including from competitors, which could limit our ability to rent space or set rents at expected levels, or which could lead to rents falling; Uncertainty and volatility in the capital and credit markets, including changes that reduce the availability of capital and increase costs; the potential loss or bankruptcy of tenants or the inability of tenants to meet their rental and other rental obligations; Risks of acquisitions and divestments, including unexpected liabilities and integration costs; Delays in completion and cost overruns related to our developments and renovations; Disagreements with joint venture partners; unexpected operating and capital costs; uninsured accidental damage and the ability to obtain adequate insurance, including coverage for acts of terrorism; Impairment of assets; our reliance on certain geographic markets; Changes in government regulations, tax laws and rates and similar matters; unexpected costs of meeting REIT qualification; and costs and disruptions as a result of a cybersecurity incident or other technological disruption. The declaration and payment of future dividends (both in time and amount) are subject to the determination of our Board of Trustees, in their sole discretion, taking into account various factors, including our financial condition, historical and forecast operating results, and available cash flows. as well as all applicable laws and contractual agreements and all other relevant factors. Our Board of Directors' practice in relation to declaring dividends may be changed at any time and from time to time. Additional information about factors that could affect us and the forward-looking statements contained herein are contained in our filings with the Securities and Exchange Commission, including our Form 10-K for the year ended December 31, 2020. We do not assume any obligation to update or supplement forward-looking statements that later become untrue, unless required by law.

Additional non-GAAP financial measures

We calculate our financial results according to generally accepted accounting principles (GAAP). While FFO and NOI are non-GAAP financial metrics, we believe that FFO and NOI calculations are useful to shareholders and prospective investors and are generally accepted metrics for real estate mutual fund performance. At the end of this press release, we have provided a reconciliation from the non-GAAP financial measures to the most directly comparable GAAP measures.

Funds from Operations (FFO)

We calculate FFO according to the standards set by the National Association of Real Estate Investment Trusts (NAREIT) which may not be comparable to the FFO of other REITs that do not calculate FFO according to the NAREIT definition or interpret the NAREIT definition differently than we. NAREIT defines FFO as net profit (loss) before non-controlling interests and excluding profits (losses) from the sale of depreciable operating real estate, impairment losses from depreciable consolidated real estate, impairment losses from investments in unconsolidated real estate companies and extraordinary items (calculated in accordance with GAAP); plus property-related depreciation (excluding depreciation on deferred financing costs) and after similar adjustments for non-consolidated joint ventures. Net Income, the GAAP measure that we believe most directly compares to FFO, includes depreciation, amortization, gains or losses on property sales, exceptional items, and non-controlling interests. To provide a clear understanding of our historical operating results, FFO should be reviewed in conjunction with GAAP net income, as presented in the financial statements contained elsewhere in this press release. FFO does not represent cash flow from operating activities (determined under GAAP) and should not be viewed as an alternative to net income (loss) (determined under GAAP) as an indication of our financial performance or as an alternative to cash flow from operating activities (determined under GAAP ) as a measure of our liquidity is not an indication of the funds available to meet our cash needs, including our ability to make cash distributions to shareholders. We generally consider FFO and FFO per share to be useful measures in understanding and comparing our results of operations, as by excluding gains and losses related to the sale of previously depreciated operating property assets, depreciation, depreciation and amortization of property assets (which may vary ) are excluded For owners of similar assets in similar condition (based on historical cost calculations and useful life estimates), FFO and FFO per share can help investors compare the operating performance of a company's real estate over reporting periods and with the operating performance of other companies.

Operating profit (NOI)

The NOI (accrual basis) is a financial metric that corresponds to the net income available to ordinary shareholders, the most directly comparable GAAP financial metric, plus general corporate and administrative expenses, depreciation, amortization, interest expenses, non-controlling interests in the operating partnership and losses Prepayment of debt, less interest income, development and management income, gains on property sales, gains on sales from discontinued operations, gains on prepayment of debt, income from discontinued operations, income from unconsolidated joint ventures and non-controlling interests in real estate partnerships. In some cases, we also represent NOI on a bar basis. This is NOI after postponing the effects of an in-place rental cessation and deferred market write-off. The NOI we are presenting may not be comparable to the NOI reported by other REITs that define NOI differently. NOI should not be viewed as an alternative to net income as an indicator of our performance or cash flows as a measure of the company's liquidity or its ability to distribute. We believe NOI is a useful metric in assessing the operating performance of our properties as it excludes certain components from the net income available to common shareholders in order to produce results more closely related to a property's earnings. We use NOI internally to assess the performance of our operating segments and make decisions about resource allocation. We have come to the conclusion that NOI provides investors with useful information about our financial position and results of operations, as it only reflects the items of income and expenditure incurred at the property level and the effects of the development of occupancy, rental prices and operations on business costs as well as Acquisition and development activities on a non-leveraged basis.

Same store properties

In our analysis of the NOI, especially to make comparisons of the NOI between time periods meaningful, it is important to provide information for properties that have been in operation and owned by us for the entire period shown. We refer to properties that were acquired or put into service prior to the start of the earliest period owned by us until the end of the last period shown as Same Store Properties. Identical retail properties therefore exclude properties that were put into operation, acquired, repositioned, held for sale or for development or renovation after the beginning of the earliest period shown, which was presented or sold before the end of the last period shown. Accordingly, it will take at least a year and a quarter after purchasing a property for that property to be included in Same Store Properties.

Core portfolio

Our core portfolio consists of our one hundred percent properties, with the exception of all properties that are currently under development, redevelopment or new entitlements.

(unchecked and by the thousands)

March 31, 2021 December 31, 2020
Real estate investments:
Operational characteristics $ 3,386,559 $ 3,474,109
Accumulated depreciation (900, 167) ) (896,561 )
Right of use asset – operating leases, net 20,810 20,977
Corporate real estate investments, net 2,507,202 2,598,525
Under construction 264,529 210.311
Land held for development 116.902 117,984
Prepaid lease shares on land held for development, net 27,762 39.185
Total real estate investments, net 2,916,395 2,966,005
Assets held for sale, net 7.349 7.349
Cash and cash equivalents 45,717 46.344
requirements 14,665 13,536
Accruals for accrued rents less allowances of $ 5,080 and $ 5,086 as of March 31, 2021 and December 31, 2020, respectively 159.175 155.372
Investment in real estate company 433.046 401,327
Prepaid expenses, net 83,839 84,856
Intangible assets, net 43,883 48,570
Other assets 185,844 176,747
Total assets $ 3,889,913 $ 3,900,106
Unsecured credit facility $ 13,000 $ – –
Unsecured term loan, net 249.215 249.084
Unsecured Senior Notes, Net 1,581,378 1,581,511
Trade payables and provisions 119.208 121,982
Distributions payable 32,763 32,706
Prepaid expenses, profits and rents 22,416 21,396
Intangible liabilities, net 17,073 18,448
Lease Liability – Operating Leases 22,810 22,758
Other liabilities 49,796 47,573
Total liabilities $ 2,107,659 $ 2,095,458
Brandywine Realty Trust Equity:
Brandywine Realty Trust common stock of economic interest, $ 0.01 face value; authorized shares 400,000,000; 170,663,251 and 170,572,964 issued and outstanding as of March 31, 2021 and December 31, 2020, respectively 1.707 1.707
Capital reserve 3,140,456 3,138,152
Deferred Compensation in Common Stock 17,658 17,516
Grantor Trust common stock, 1,111,777 and 1,160,494 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively (17.658 ) (17.516 )
Cumulative result 1,117,004 1,110,083
Cumulative other comprehensive loss (6.469 ) (7,561 )
Cumulative distributions (2,480,811 ) (2,448,238 )
Equity of the entire Brandywine Realty Trust 1,771,887 1,794,143
Non-dominant interests 10,367 10,505
Beneficiary equity $ 1,782,254 $ 1,804,648
Total liabilities and equity of the beneficiaries $ 3,889,913 $ 3,900,106

(unchecked by the thousands, except release and pro-release data)

Three months to March 31
2021 2020
Rent $ 113.484 $ 139.204
Third party administration fees, labor reimbursement and leasing 6,651 4,954
Other 634 930
Total sales 120,769 145.088
Operating expenses
Real estate operating costs 28,935 37.461
Property taxes 14,761 16,787
Third party administrative costs 2,978 2,662
Depreciation 40.343 52.038
General and administrative expenses 6.584 8,561
Business expense 93,601 117.509
Profit from the sale of real estate
Net income from the sale of real estate 74 2.586
Net profit from the sale of real estate not depreciated 1.993 – –
Total profit from the sale of real estate 2.067 2.586
Operating profit 29.235 30.165
Other income (expenses):
Interest and investment income 1,674 575
Interest expenses (16.293 ) (20.009 )
Interest expense – amortization of deferred finance costs (709 ) (749 )
Equity in the event of loss of real estate ventures (6.924 ) (1,891 )
Earnings before taxes 6,983 8.091
Income tax provision (19 ) (4th )
Net income 6,964 8.087
Result from non-controlling interests (43 ) (65 )
Brandywine Realty Trust Net Income 6,921 8.022
Inapplicable dividends that will be distributed to untransferred restricted shareholders (146 ) (131 )
Brandywine Realty Trust Ordinary Shareholders' Net Income $ 6.775 $ 7,891
Basic income per common share $ 0.04 $ 0.04
Basic Weighted Average Shares Outstanding 170,624,741 176,069,968
Diluted earnings per common share $ 0.04 $ 0.04
Diluted Weighted Average Shares Outstanding 171,636,120 176,653,459

(unchecked by the thousands, except release and pro-release data)

Three months to March 31
2021 2020
Reconciliation of the net result to funds from operations:
Annual surplus attributable to the ordinary shareholders $ 6.775 $ 7,891
Add (subtract):
Result from non-controlling interests – LP units 44 53
Inapplicable dividends that will be distributed to untransferred restricted shareholders 146 131
Net income from the sale of real estate (74 ) (2.586 )
property 31,534 38,353
Leasing costs including acquired intangible assets 8.280 13.199
Company's share in unconsolidated real estate companies 13,731 4,599
Share of partners in consolidated real estate companies (5 ) (60 )
Funds from Operations $ 60.431 $ 61,580
Operating funds that may be allocated to non-delegated limited liability shareholders (213 ) (190 )
Operating funds available to common stocks and shareholders (FFO) $ 60.218 $ 61,390
FFO per share – fully diluted $ 0.35 $ 0.35
Weighted average of shares / units issued – fully diluted 172,617,754 177.635.093
Distributions per ordinary share $ 0.19 $ 0.19
FFO payout ratio (dividends per common share / FFO per diluted share) 54.3 %. 54.3 %.

(unchecked and by the thousands)

Of the 81 properties owned by the company as of March 31, 2021, 73 were properties ("same store properties") with a total rental area of ​​12.5 million square meters for the three months ended March 31, 2021 and 2020 As of March 31, 2021, three properties were recently completed / acquired and five properties were under development / refurbishment. The average occupancy of the Same Store Properties for the three-month periods ended March 31, 2021 and 2020 were 90.3% and 92.5%, respectively. The following table shows income and expense information for the same business properties:

Three months to March 31
2021 2020
Rent $ 106,876 $ 107.362
Other 207 285
Total sales 107.083 107.647
Operating expenses
Real estate operating costs 26,863 28,031
Property taxes 12,895 12,666
Net operating income $ 67.325 $ 66,950
Operating profit – percentage change from previous year 0.6 %.
Operating profit excluding other items $ 65,085 $ 65,685
Operating result excluding other items – percentage change compared to the previous year (0.9 ) %.
Net operating income $ 67.325 $ 66,950
Just rent & others (3.247 ) (2.272 )
Amortization above / below the market rent (970 ) (1.295 )
Amortization of tenant incentives 193 202
Property rent 208 211
Cash – Operating Income $ 63.509 $ 63,796
Cash – Operating Income – percentage change from previous year (0.4 ) %.
Cash – Income from operations excluding other items $ 61.130 $ 62,039
Cash – operating income excluding other items – percentage change from previous year (1.5 ) %.
Three months to March 31
2021 2020
Net income: $ 6,964 $ 8.087
Add / (subtract):
Interest income (1.674 ) (575 )
Interest expenses 16.293 20.009
Interest expense – amortization of deferred finance costs 709 749
Equity in the event of loss of real estate ventures 6,924 1,891
Net income from the sale of real estate (74 ) (2.586 )
Net profit from the sale of real estate not depreciated (1.993 ) – –
Depreciation 40.343 52.038
General and administrative costs 6.584 8,561
Income tax provision 19th 4th
Group operating profit 74,095 88.178
Less: operating result of non-identical retail properties and elimination of non-property-specific processes (6.770 ) (21.228 )
Same operating income of the business $ 67.325 $ 66,950

Company / investor contact:

Tom Wirth
[email protected]