Cousins Properties Inc (CUZ) 8-K Earnings Release



Forward-Looking Statements	3
Earnings Release	4
Condensed Consolidated Balance Sheets	6
Condensed Consolidated Statements of Operations	7
Key Performance Metrics	8
Funds From Operations - Summary	11
Funds From Operations - Detail	12
Portfolio Statistics	15
Same Property Performance	17
Office Leasing Activity	18
Office Lease Expirations	19
Top 20 Office Tenants	21
Tenant Industry Diversification	22
Investment Activity	23
Development Pipeline	25
Land Inventory	26
Debt Schedule	27
Non-GAAP Financial Measures - Calculations and Reconciliations	30
Non-GAAP Financial Measures - Discussion	35



Cousins Properties		Q3 2018 Supplemental Information



FORWARD-LOOKING STATEMENTS

Certain matters contained in this report are “forward-looking statements” within the meaning of the federal securities laws and are subject to uncertainties and risks, as itemized in Item 1A included in the Annual Report on Form 10-K for the year ended December 31, 2017 and in the Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2018. These forward-looking statements include information about possible or assumed future results of the business and our financial condition, liquidity, results of operations, plans, and objectives. They also include, among other things, statements regarding subjects that are forward-looking by their nature, such as, our 2018 guidance and underlying assumptions, business and financial strategy, future financings, future acquisitions and dispositions of land (including ground leases), future acquisitions and dispositions of operating assets, future development and redevelopment opportunities, future fee development opportunities, future issuances and repurchases of common or preferred stock, future distributions, future projected capital expenditures, future changes in interest rates, market and industry tends, and all statements that address operating performance, events, or developments that we expect or anticipate will occur in the future, including statements relating to creating value for stockholders.

Any forward-looking statements are based upon management's beliefs, assumptions, and expectations of our future performance, taking into account information currently available. These beliefs, assumptions, and expectations may change as a result of possible events or factors, not all of which are known. If a change occurs, our business, financial condition, liquidity, and results of operations may vary materially from those expressed in forward-looking statements. Actual results may vary from forward-looking statements due to, but not limited to, the following: the availability and terms of capital, the ability to refinance or repay indebtedness as it matures, the failure of purchase, sale, or other contracts to ultimately close, the failure to achieve anticipated benefits from acquisitions, investments, or dispositions, the potential dilutive effect of common stock or operating partnership unit issuances, the availability of buyers and pricing with respect to the disposition of assets, risks and uncertainties related to national and local economic conditions, the real estate industry, and the commercial real estate markets in which we operate, particularly in Atlanta, Charlotte, Austin, Phoenix, and Tampa where we have high concentrations of our lease revenue, changes to our strategy with regard to non-core holdings that require impairment losses to be recognized, leasing risks, including the ability to obtain new tenants or renew expiring tenants, the ability to lease newly developed and/or recently acquired space, and the risk of declining leasing rates, the adverse change in the financial condition of one or more of our major tenants, volatility in interest rates and insurance rates, competition from other developers or investors, the risks associated with real estate developments (such as zoning approval, receipt of required permits, construction delays, cost overruns, and leasing risk), changes in senior management and the loss of key personnel, the potential liability for uninsured losses, condemnation, or environmental issues, the potential liability for a failure to meet regulatory requirements, the financial condition and liquidity of, or disputes with, joint venture partners, any failure to comply with debt covenants under credit agreements, any failure to continue to qualify for taxation as a real estate investment trust and meet regulatory requirements, potential changes to state, local, or federal regulations applicable to our business, material changes in the dividend rates or the ability to pay dividends on common shares or other securities, potential changes to the tax laws and accounting standards impacting REITs and real estate in general, and those additional risks and factors discussed in reports filed with the Securities and Exchange Commission by the Company.

The words “believes,” “expects,” “anticipates,” “estimates,” “plans,” “may,” “intend,” “will,” or similar expressions are intended to identify forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in any forward-looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information, or otherwise, except as required under U.S. federal securities laws.



Cousins Properties	3	Q3 2018 Supplemental Information



EARNINGS RELEASE

COUSINS PROPERTIES REPORTS THIRD QUARTER 2018 RESULTS

Third Quarter Highlights


•	Net income available to common stockholders was $0.05 per share.


•	Funds From Operations was $0.16 per share.


•	Same property net operating income on a cash-basis increased 4.4%.


•	Second generation net rent per square foot on a cash-basis increased 7.6%.


•	Executed 485,598 square feet of office leases.


•	Increased the size of 300 Colorado, a new office development in the Austin CBD, by two floors bringing the total to 358,000 square feet.


•	In October 2018, commenced operations at 858 Spring Street, Phase II of NCR's world headquarters in Midtown Atlanta.

ATLANTA (October 24, 2018) - Cousins Properties (NYSE:CUZ) today reported its results of operations for the quarter ended September 30, 2018.

Financial Results

Net income available to common stockholders was $19.5 million, or $0.05 per share, for the third quarter of 2018, compared with $12.1 million, or $0.03 per share, for the third quarter of 2017. Net Income available to common stockholders was $56.8 million, or $0.14 per share, for the nine months ended September 30, 2018, compared with $184.9 million, or $0.45 per share, for the nine months ended September 30, 2017. In the second quarter of 2017, the Company recognized a net gain of $119.8 million on the sale of the American Cancer Society Center in Atlanta.

Funds From Operations ("FFO") was $67.5 million, or $0.16 per share, for the third quarter of 2018 compared with $62.3 million, or $0.15 per share, for the third quarter of 2017. FFO was $196.7 million, or $0.46 per share, for the nine months ended September 30, 2018, compared to $195.7 million, or $0.46 per share, for the nine months ended September 30, 2017.

2018 Guidance

Based on third quarter 2018 results, the Company has raised and narrowed its full year 2018 net income guidance from $0.15 to $0.19 per share to $0.16 to $0.19 per share. The Company has also raised and narrowed its full year 2018 FFO guidance from $0.59 to $0.63 per share to $0.60 to $0.63 per share.

The Company leaves unchanged the previously provided assumptions of its 2018 net income and FFO guidance, except for the following update:


•	General and administrative expenses, net of capitalized salaries of $23.5 million to $25.5 million, down from the previous range of $25.5 million to $27.5 million, due to a decrease in long-term incentive compensation based on the Company's stock performance.



Cousins Properties	4	Q3 2018 Supplemental Information



EARNINGS RELEASE

A reconciliation of projected net income per share to projected FFO per share is provided as follows:



	Full Year 2018 Range
	Low		High
Net income per share	$	0.16	$	0.19
Add: Real estate depreciation and amortization	0.44		0.44
Funds From Operations per share	$	0.60	$	0.63

The Company's guidance is provided for information purposes based on current plans and assumptions and is subject to change.

Investor Conference Call and Webcast

The Company will conduct a conference call at 11:00 a.m. (Eastern Time) on Thursday, October 25, 2018, to discuss the results of the quarter ended September 30, 2018. The number to call for this interactive teleconference is (877) 247-1056. The live webcast of this call can be accessed on the Company's website, www.cousins.com, through the “Cousins Properties Third Quarter Conference Call” link on the Investor Relations page.

A replay of the conference call will be available for seven days by dialing (877) 344-7529 and entering the passcode 10124642. The playback can also be accessed on the Company's website.

Acting through its operating partnership Cousins Properties, LP, Cousins Properties is a leading fully-integrated real estate investment trust (REIT) with extensive experience in development, acquisition, financing, management, and leasing. Based in Atlanta, the Company actively invests in top-tier urban office assets and opportunistic mixed-use properties in Sunbelt markets.



Cousins Properties	5	Q3 2018 Supplemental Information



CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)



	September 30, 2018			December 31, 2017
	(unaudited)
Assets:
Real estate assets:
Operating properties, net of accumulated depreciation of $384,097 and $275,977 in 2018 and 2017, respectively	$	3,499,741		$	3,332,619
Projects under development	128,580			280,982
Land	4,221			4,221
	3,632,542			3,617,822

Cash and cash equivalents	82,706			148,929
Restricted cash	419			56,816
Notes and accounts receivable, net of allowance for doubtful accounts of $456 and $535 in 2018 and 2017, respectively	10,400			14,420
Deferred rents receivable	76,494			58,158
Investment in unconsolidated joint ventures	154,070			101,414
Intangible assets, net	155,025			186,206
Other assets	31,943			20,854
Total assets	$	4,143,599		$	4,204,619
Liabilities:
Notes payable	$	1,065,012		$	1,093,228
Accounts payable and accrued expenses	114,229			137,909
Deferred income	40,035			37,383
Intangible liabilities, net of accumulated amortization of $39,332 and $28,960 in 2018 and 2017, respectively	60,082			70,454
Other liabilities	39,786			40,534
Total liabilities	1,319,144			1,379,508
Commitments and contingencies
Equity:
Stockholders' investment:
Preferred stock, $1 par value, 20,000,000 shares authorized, 6,867,357 shares issued and outstanding in 2018 and 2017	6,867			6,867
Common stock, $1 par value, 700,000,000 shares authorized, 430,724,520 and 430,349,620 shares issued in 2018 and 2017, respectively	430,725			430,350
Additional paid-in capital	3,605,617			3,604,776
Treasury stock at cost, 10,339,735 and 10,329,082 shares in 2018 and 2017, respectively	(148,473		)	(148,373		)
Distributions in excess of cumulative net income	(1,124,518		)	(1,121,647		)
Total stockholders' investment	2,770,218			2,771,973
Nonredeemable noncontrolling interests	54,237			53,138
Total equity	2,824,455			2,825,111
Total liabilities and equity	$	4,143,599		$	4,204,619



Cousins Properties	6	Q3 2018 Supplemental Information



CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited; in thousands, except per share amounts)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Revenues:
Rental property revenues	$	115,443		$	109,569		$	342,489		$	336,093
Fee income	2,519			2,597			7,211			6,387
Other	744			993			2,836			9,593
	118,706			113,159			352,536			352,073
Expenses:
Rental property operating expenses	41,579			40,688			122,501			123,715
Reimbursed expenses	955			895			2,757			2,667
General and administrative expenses	3,913			7,193			18,793			21,993
Interest expense	9,551			7,587			29,043			25,851
Depreciation and amortization	45,068			47,622			135,836			152,546
Acquisition and transaction costs	—			(677		)	228			1,499
Other	93			423			457			1,063
	101,159			103,731			309,615			329,334
Gain on extinguishment of debt	93			429			8			2,258
Income from continuing operations before unconsolidated joint ventures and gain (loss) on sale of investment properties	17,640			9,857			42,929			24,997
Income from unconsolidated joint ventures	2,252			2,461			10,173			43,362
Income from continuing operations before gain (loss) on sale of investment properties	19,892			12,318			53,102			68,359
Gain (loss) on sale of investment properties	(33		)	(33		)	4,912			119,729
Net Income	19,859			12,285			58,014			188,088
Net income attributable to noncontrolling interests	(374		)	(218		)	(1,210		)	(3,181		)
Net income available to common stockholders	$	19,485		$	12,067		$	56,804		$	184,907
Net income per common share — basic and diluted	$	0.05		$	0.03		$	0.14		$	0.45
Weighted average shares — basic	420,385			419,998			420,279			414,123
Weighted average shares — diluted	427,520			427,300			427,472			421,954



Cousins Properties	7	Q3 2018 Supplemental Information



KEY PERFORMANCE METRICS



	2016		2017 1st		2017 2nd		2017 3rd		2017 4th		2017		2018 1st		2018 2nd		2018 3rd		2018 YTD
Property Statistics
Consolidated Operating Properties	24		25		25		25		22		22		23		23		23		23
Consolidated Rentable Square Feet (in thousands)	13,024		13,249		12,477		12,466		11,428		11,428		11,936		11,944		11,944		11,944
Unconsolidated Operating Properties	7		6		4		5		4		4		4		4		4		4
Unconsolidated Rentable Square Feet (in thousands)	3,999		3,774		2,988		3,456		3,113		3,113		3,113		3,113		3,113		3,113
Total Operating Properties	31		31		29		30		26		26		27		27		27		27
Total Rentable Square Feet (in thousands)	17,023		17,023		15,465		15,922		14,541		14,541		15,049		15,057		15,057		15,057

Office Leasing Activity (1)
Net Leased during the Period (square feet in thousands)	2,354		571		341		335		943		2,190		330		328		486		1,143
Net Rent (per square foot)	$24.52		$26.10		$28.58		$26.57		$32.73		$29.41		$33.35		$32.40		$28.46		$31.00
Free rent (per square foot)	(1.26)		(1.21)		(0.91)		(0.83)		(0.39)		(0.75)		(0.55)		(1.00)		(0.94)		(0.84)
Leasing commissions (per square foot) (2)	(1.78)		(1.93)		(2.78)		(2.32)		(2.40)		(2.32)		(2.67)		(2.49)		(2.40)		(2.50)
Tenant improvements (per square foot)	(3.91)		(4.78)		(4.66)		(3.46)		(4.49)		(4.43)		(3.07)		(4.50)		(4.29)		(4.00)
Net Effective Rent (per square foot)	$17.57		$18.18		$20.23		$19.96		$25.45		$21.91		$27.06		$24.41		$20.83		$23.66
Change in Second Generation Net Rent	20.0	%	15.8	%	28.5	%	16.9	%	19.7	%	19.6	%	35.2	%	34.2	%	25.8	%	31.1	%
Change in Cash-Basis Second Generation Net Rent	10.3	%	3.3	%	13.5	%	7.3	%	6.3	%	6.9	%	19.3	%	13.1	%	7.6	%	13.2	%

Same Property Information (3)
Percent Leased (period end)	91.8	%	92.1	%	93.9	%	92.9	%	92.6	%	92.6	%	93.6	%	93.5	%	94.2	%	94.2	%
Weighted Average Occupancy	89.4	%	89.9	%	90.7	%	89.1	%	87.7	%	89.4	%	92.0	%	91.9	%	91.8	%	91.9	%
Change in Net Operating Income (over prior year period)	6.1	%	5.5	%	6.8	%	1.3	%	3.6	%	4.4	%	2.6	%	1.3	%	2.7	%	2.2	%
Change in Cash-Basis Net Operating Income (over prior year period)	8.4	%	5.4	%	8.6	%	2.0	%	4.2	%	5.3	%	9.4	%	4.1	%	4.4	%	5.9	%

Development Pipeline
Estimated Project Costs (in thousands) (4)	$512,200		$529,200		$463,500		$402,000		$490,500		$490,500		$271,500		$358,800		$362,900		$362,900
Estimated Project Costs (4) / Total Undepreciated Assets	10.5	%	10.6	%	9.6	%	8.1	%	9.9	%	9.9	%	5.5	%	7.2	%	7.2	%	7.2	%

Market Capitalization (5)
Common Stock Price (period end)	$8.51		$8.27		$8.79		$9.34		$9.25		$9.25		$8.68		$9.69		$8.89		$8.89
Common Stock/Units Outstanding (period end in thousands)	401,596		426,823		426,942		426,995		426,995		426,995		427,218		427,368		427,359		427,359
Equity Market Capitalization (in thousands)	$3,417,582		$3,529,826		$3,752,820		$3,988,133		$3,949,704		$3,949,704		$3,708,252		$4,141,196		$3,799,222		$3,799,222
Debt (in thousands)	1,632,270		1,498,044		1,205,632		1,286,252		1,262,523		1,262,523		1,262,833		1,261,459		1,236,891		1,236,891
Total Market Capitalization (in thousands)	$5,049,852		$5,027,870		$4,958,452		$5,274,385		$5,212,227		$5,212,227		$4,971,085		$5,402,655		$5,036,113		$5,036,113

Credit Ratios (5)
Net Debt/Total Market Capitalization	31.6	%	29.1	%	24.0	%	23.2	%	21.4	%	21.4	%	23.2	%	21.3	%	22.9	%	22.9	%
Net Debt/Total Undepreciated Assets	32.8	%	29.4	%	24.7	%	24.7	%	22.5	%	22.5	%	23.5	%	23.1	%	22.9	%	22.9	%
Net Debt/Annualized Adjusted EBITDAre	5.22		4.49		3.93		4.31		3.75		3.75		3.77		3.76		3.65		3.65
Fixed Charges Coverage (Adjusted EBITDAre)	4.63		5.13		5.49		5.82		6.01		5.58		5.39		5.37		5.67		5.48



Cousins Properties	8	Q3 2018 Supplemental Information



KEY PERFORMANCE METRICS



	2016		2017 1st		2017 2nd		2017 3rd		2017 4th		2017		2018 1st		2018 2nd		2018 3rd		2018 YTD

Dividend Information (5)
Common Dividend per Share (6)	$0.30		$0.06		$0.06		$0.06		$0.06		$0.24		$0.065		$0.065		$0.065		$0.195
Funds From Operations (FFO) Payout Ratio	46.1	%	37.5	%	38.0	%	40.4	%	39.3	%	38.8	%	42.3	%	42.3	%	40.5	%	41.7	%
Funds Available for Distribution (FAD) Payout Ratio	59.0	%	56.4	%	52.9	%	67.2	%	66.8	%	60.2	%	61.9	%	61.2	%	59.1	%	60.7	%

Operations Ratio (5)
Annualized General and Administrative Expenses/Total Undepreciated Assets	0.53	%	0.50	%	0.72	%	0.58	%	0.45	%	0.56	%	0.55	%	0.65	%	0.31	%	0.50	%

Additional Information (5) (in thousands, except per square foot amounts)
In-Place Gross Rent (per square foot) (7)	$32.64		$33.70		$33.13		$34.02		$34.19		$34.19		$34.98		$35.08		$35.23		$35.23
Straight Line Rental Revenue	$18,967		$9,608		$7,826		$6,825		$6,714		$30,973		$8,136		$5,690		$5,148		$18,974
Above and Below Market Rents Amortization	$7,097		$1,602		$1,929		$1,852		$1,838		$7,221		$1,793		$1,714		$1,730		$5,237
Second Generation Capital Expenditures	$46,876		$10,971		$7,569		$15,949		$18,996		$53,485		$11,256		$11,077		$15,152		$37,485

(1) See Office Leasing Activity on page 18 for additional detail and explanations.

(2) Effective in the second quarter 2018, the Company began including commissions paid to its internal leasing personnel. Prior period amounts presented have been adjusted from what was previously disclosed for this change.

(3) Same Property Information is derived from the pool of office properties, as defined, in the period originally reported. See Same Property Performance on page 17 and Non-GAAP Financial Measures - Calculations and Reconciliations on page 34 for additional information.

(4) Represents Cousins' share of estimated project costs. See Development Pipeline on page 25 for additional detail.

(5) See Non-GAAP Financial Measures - Calculations and Reconciliations beginning on page 30.

(6) The fourth quarter 2016 dividend was declared and paid one quarter in arrears.

(7) In-place gross rent represents the annualized cash basis base rent including tenant's share of estimated operating expenses, if applicable, as of the end of the period divided by occupied square feet.



Cousins Properties	9	Q3 2018 Supplemental Information



KEY PERFORMANCE METRICS

(1) Office properties only.

Note: See additional information included herein for calculations, definitions, and reconciliations to GAAP financial measures.



Cousins Properties	10	Q3 2018 Supplemental Information



FUNDS FROM OPERATIONS - SUMMARY (1)



	(amounts in thousands, except per share amounts)
	2016			2017 1st			2017 2nd			2017 3rd			2017 4th			2017			2018 1st			2018 2nd			2018 3rd			2018 YTD
Net Operating Income	$	260,281		$	80,167		$	80,115		$	75,815		$	77,109		$	313,206		$	80,578		$	80,195		$	80,858		$	241,631
Land Sales Less Cost of Sales	3,770			—			63			4			—			67			330			2,449			—			2,779
Fee Income	8,347			1,936			1,854			2,597			2,245			8,632			2,894			1,798			2,519			7,211
Other Income	5,525			6,889			5,304			1,634			2,164			15,991			1,034			1,212			915			3,161
Reimbursed Expenses	(3,259		)	(865		)	(907		)	(895		)	(860		)	(3,527		)	(942		)	(860		)	(955		)	(2,757		)
General and Administrative Expenses	(25,592		)	(6,182		)	(8,618		)	(7,193		)	(5,530		)	(27,523		)	(6,809		)	(8,071		)	(3,913		)	(18,793		)
Interest Expense	(41,095		)	(12,066		)	(10,444		)	(9,363		)	(9,509		)	(41,382		)	(11,293		)	(11,305		)	(11,208		)	(33,806		)
Other Expenses	(45,984		)	(2,391		)	(542		)	196			(953		)	(3,690		)	(695		)	(365		)	(257		)	(1,317		)
Depreciation and Amortization of Non-Real Estate Assets	(1,365		)	(451		)	(465		)	(461		)	(497		)	(1,874		)	(473		)	(468		)	(469		)	(1,410		)
FFO (1)	$	160,628		$	67,037		$	66,360		$	62,334		$	64,169		$	259,900		$	64,624		$	64,585		$	67,490		$	196,699
Weighted Average Shares - Diluted	256,023			411,186			427,180			427,300			427,288			423,297			427,381			427,501			427,520			427,472
FFO per Share (1)	$	0.63		$	0.16		$	0.16		$	0.15		$	0.15		$	0.61		$	0.15		$	0.15		$	0.16		$	0.46

(1) See pages 30 and 33 for reconciliations of Funds from Operations to net income available to common stockholders.



Cousins Properties	11	Q3 2018 Supplemental Information



FUNDS FROM OPERATIONS - DETAIL (1)



	(amounts in thousands, except per share amounts)
	2016		2017 1st		2017 2nd		2017 3rd		2017 4th		2017		2018 1st		2018 2nd		2018 3rd		2018 YTD

Net Operating Income
Consolidated Properties
Hearst Tower	$	5,957	$	6,356	$	6,370	$	6,302	$	7,158	$	26,186	$	6,493	$	6,426	$	6,456	$	19,375
Northpark (2)	22,144		5,410		5,130		4,945		5,021		20,506		5,731		5,814		6,204		17,749
Corporate Center (2)	5,005		4,761		5,374		5,308		5,446		20,889		5,780		5,956		5,947		17,683
Hayden Ferry (2)	3,881		5,209		5,307		5,466		5,968		21,950		5,766		5,433		5,894		17,093
Fifth Third Center	17,501		4,842		4,681		4,772		4,989		19,284		4,729		4,647		4,912		14,288
864 Spring Street	—		—		—		—		50		50		4,726		4,608		4,704		14,038
Buckhead Plaza (2)	4,186		4,418		4,143		4,389		4,566		17,516		4,330		4,382		4,367		13,079
Promenade	14,555		4,173		4,407		4,184		3,991		16,755		4,240		4,242		4,125		12,607
One Eleven Congress	3,256		3,713		3,735		4,172		3,526		15,146		4,036		4,039		4,034		12,109
San Jacinto Center	3,456		4,038		4,207		3,918		3,906		16,069		3,635		3,632		3,596		10,863
Colorado Tower	12,408		3,383		3,352		3,344		3,478		13,557		3,429		3,453		3,511		10,393
3344 Peachtree	3,505		3,235		2,884		2,705		2,085		10,909		2,994		3,069		2,970		9,033
816 Congress	9,900		2,694		2,641		2,766		2,797		10,898		2,780		2,911		3,016		8,707
NASCAR Plaza	2,507		2,477		2,394		2,609		2,709		10,189		2,652		2,590		2,683		7,925
Tempe Gateway	1,966		2,008		2,136		1,964		1,971		8,079		1,893		2,029		1,997		5,919
3350 Peachtree	2,006		2,264		2,288		2,153		1,968		8,673		1,987		1,899		1,888		5,774
3348 Peachtree	1,541		1,491		1,491		1,657		1,507		6,146		1,405		1,360		1,472		4,237
111 West Rio	—		—		1,396		1,236		1,412		4,044		1,314		1,419		1,374		4,107
8000 Avalon	—		—		—		80		353		433		1,357		1,350		1,144		3,851
The Pointe	1,227		1,146		1,146		1,069		1,207		4,568		1,236		1,170		1,179		3,585
Research Park V	844		359		916		874		827		2,976		1,012		1,016		1,023		3,051
Meridian Mark Plaza	3,674		989		997		979		1,116		4,081		920		1,006		1,049		2,975
Harborview Plaza	898		930		931		1,035		1,074		3,970		712		516		319		1,547
Other (3)	32,487		7,095		6,580		2,954		2,650		19,279		—		—		—		—
Subtotal - Consolidated	152,904		70,991		72,506		68,881		69,775		282,153		73,157		72,967		73,864		219,988

Unconsolidated Properties (4)
Terminus (2)	14,340		3,710		3,655		3,598		3,514		14,477		3,486		3,415		3,345		10,246
Gateway Village (2)(5)	2,450		1,751		1,756		1,805		1,735		7,047		1,968		1,770		1,873		5,611
Emory University Hospital Midtown Medical Office Tower	3,970		989		948		961		1,015		3,913		990		1,031		1,028		3,049
Carolina Square (2)	—		—		—		47		658		705		928		975		747		2,650
300 Colorado	—		—		—		—		—		—		49		37		1		87
Other (3)	8,026		2,726		1,250		523		412		4,911		—		—		—		—
Subtotal - Unconsolidated	28,786		9,176		7,609		6,934		7,334		31,053		7,421		7,228		6,994		21,643

Discontinued Operations (6)	78,591		—		—		—		—		—		—		—		—		—

Total Net Operating Income (1)	260,281		80,167		80,115		75,815		77,109		313,206		80,578		80,195		80,858		241,631

Sales Less Cost of Sales
Land Sales Less Cost of Sales - Consolidated	3,580		—		63		4		—		67		—		—		—		—
Land Sales Less Cost of Sales - Unconsolidated (4)	190		—		—		—		—		—		330		2,449		—		2,779
Total Sales Less Cost of Sales	3,770		—		63		4		—		67		330		2,449		—		2,779



Cousins Properties	12	Q3 2018 Supplemental Information



FUNDS FROM OPERATIONS - DETAIL (1)



	(amounts in thousands, except per share amounts)
	2016		2017 1st		2017 2nd		2017 3rd		2017 4th		2017		2018 1st		2018 2nd		2018 3rd		2018 YTD
Fee Income
Management Fees (7)	5,158		1,402		1,492		1,458		1,442		5,794		1,524		1,401		1,537		4,462
Development Fees	2,277		432		318		1,062		328		2,140		291		271		951		1,513
Leasing & Other Fees	912		102		44		77		475		698		1,079		126		31		1,236
Total Fee Income	8,347		1,936		1,854		2,597		2,245		8,632		2,894		1,798		2,519		7,211

Other Income
Termination Fees	122		5,238		2,913		734		385		9,270		360		639		276		1,275
Termination Fees - Unconsolidated (4)	3,000		959		195		132		8		1,294		—		—		—		—
Termination Fees - Discontinued Operations (6)	288		—		—		—		—		—		—		—		—		—
Interest and Other Income	928		188		262		258		1,540		2,248		600		493		468		1,561
Interest and Other Income - Unconsolidated (4)	1,188		504		105		81		231		921		74		80		78		232
Interest and Other Income - Discontinued Operations (6)	(1	)	—		—		—		—		—		—		—		—		—
Gain on Extinguishment of Debt	—		—		1,829		429		—		2,258		—		—		93		93
Total Other Income	5,525		6,889		5,304		1,634		2,164		15,991		1,034		1,212		915		3,161

Total Fee and Other Income	13,872		8,825		7,158		4,231		4,409		24,623		3,928		3,010		3,434		10,372

Reimbursed Expenses	(3,259	)	(865	)	(907	)	(895	)	(860	)	(3,527	)	(942	)	(860	)	(955	)	(2,757	)

General and Administrative Expenses	(25,592	)	(6,182	)	(8,618	)	(7,193	)	(5,530	)	(27,523	)	(6,809	)	(8,071	)	(3,913	)	(18,793	)

Interest Expense
Consolidated Debt
Senior Notes, Unsecured ($250M)	—		—		—		(2,353	)	(2,489	)	(4,842	)	(2,489	)	(2,490	)	(2,488	)	(7,467	)
Term Loan, Unsecured	(386	)	(1,288	)	(1,564	)	(1,655	)	(1,691	)	(6,198	)	(1,858	)	(2,088	)	(2,205	)	(6,151	)
Fifth Third Center	(1,702	)	(1,272	)	(1,266	)	(1,260	)	(1,254	)	(5,052	)	(1,247	)	(1,241	)	(1,235	)	(3,723	)
Promenade	(4,614	)	(1,134	)	(1,127	)	(1,119	)	(1,112	)	(4,492	)	(1,102	)	(1,095	)	(1,085	)	(3,282	)
Colorado Tower	(1,412	)	(1,059	)	(1,059	)	(1,059	)	(1,059	)	(4,236	)	(1,059	)	(1,059	)	(1,059	)	(3,177	)
Senior Notes, Unsecured ($100M)	—		—		(876	)	(1,025	)	(1,036	)	(2,937	)	(1,036	)	(1,037	)	(1,036	)	(3,109	)
816 Congress Avenue	(3,268	)	(814	)	(810	)	(806	)	(803	)	(3,233	)	(799	)	(795	)	(792	)	(2,386	)
Credit Facility, Unsecured	(3,914	)	(1,035	)	(1,153	)	(444	)	(418	)	(3,050	)	(742	)	(754	)	(754	)	(2,250	)
Meridian Mark Plaza	(1,512	)	(373	)	(372	)	(370	)	(368	)	(1,483	)	(366	)	(368	)	(359	)	(1,093	)
Other (3)	(14,540	)	(4,356	)	(2,514	)	(197	)	(176	)	(7,243	)	(175	)	(177	)	(74	)	(426	)
Capitalized	4,697		1,590		2,218		2,701		2,733		9,242		1,095		1,390		1,536		4,021
Subtotal - Consolidated	(26,651	)	(9,741	)	(8,523	)	(7,587	)	(7,673	)	(33,524	)	(9,778	)	(9,714	)	(9,551	)	(29,043	)

Unconsolidated Debt (4)
Terminus	(4,919	)	(1,214	)	(1,209	)	(1,204	)	(1,196	)	(4,823	)	(1,001	)	(995	)	(988	)	(2,984	)
Emory University Hospital Midtown Medical Office Tower	(1,311	)	(324	)	(322	)	(320	)	(319	)	(1,285	)	(317	)	(315	)	(314	)	(946	)
Carolina Square	—		—		—		(27	)	(157	)	(184	)	(197	)	(281	)	(355	)	(833	)
Other (3)	(2,193	)	(787	)	(390	)	(225	)	(164	)	(1,566	)	—		—		—		—
Subtotal - Unconsolidated	(8,423	)	(2,325	)	(1,921	)	(1,776	)	(1,836	)	(7,858	)	(1,515	)	(1,591	)	(1,657	)	(4,763	)

Discontinued Operations (6)	(6,021	)	—		—		—		—		—		—		—		—		—

Total Interest Expense	(41,095	)	(12,066	)	(10,444	)	(9,363	)	(9,509	)	(41,382	)	(11,293	)	(11,305	)	(11,208	)	(33,806	)



Cousins Properties	13	Q3 2018 Supplemental Information



FUNDS FROM OPERATIONS - DETAIL (1)



	(amounts in thousands, except per share amounts)
	2016			2017 1st			2017 2nd			2017 3rd			2017 4th			2017			2018 1st			2018 2nd			2018 3rd			2018 YTD
Other Expenses
Severance	(249		)	(28		)	—			(73		)	(345		)	(446		)	(195		)	128			4			(63		)
Partners' share of FFO in consolidated joint ventures	(3,775		)	—			—			(4		)	(12		)	(16		)	(144		)	(134		)	(121		)	(399		)
Property Taxes and Other Holding Costs	(440		)	(304		)	(140		)	(139		)	(181		)	(764		)	(130		)	(152		)	(148		)	(430		)
Loss on Extinguishment of Debt - Consolidated	—			—			—			—			—			—			(85		)	—			—			(85		)
Loss on Extinguishment of Debt - Unconsolidated (4)	(5,180		)	—			—			—			—			—			—			—			—			—
Predevelopment & Other Costs	(943		)	(129		)	(156		)	(265		)	(253		)	(803		)	(50		)	(70		)	8			(112		)
Transaction Costs - Merger	(24,522		)	(1,930		)	(246		)	677			(162		)	(1,661		)	(91		)	(137		)	—			(228		)
Transaction Costs - Spin-off	(6,349		)	—			—			—			—			—			—			—			—			—
Impairment Loss	(4,526		)	—			—			—			—			—			—			—			—			—
Total Other Expenses	(45,984		)	(2,391		)	(542		)	196			(953		)	(3,690		)	(695		)	(365		)	(257		)	(1,317		)

Depreciation and Amortization of Non-Real Estate Assets	(1,365		)	(451		)	(465		)	(461		)	(497		)	(1,874		)	(473		)	(468		)	(469		)	(1,410		)

FFO (1)	$	160,628		$	67,037		$	66,360		$	62,334		$	64,169		$	259,900		$	64,624		$	64,585		$	67,490		$	196,699
Weighted Average Shares - Diluted	256,023			411,186			427,180			427,300			427,288			423,297			427,381			427,501			427,520			427,472
FFO per Share (1)	$	0.63		$	0.16		$	0.16		$	0.15		$	0.15		$	0.61		$	0.15		$	0.15		$	0.16		$	0.46

Note: Amounts may differ slightly from other schedules contained herein due to rounding.

(1) See Non-GAAP Financial Measures - Calculations and Reconciliations beginning on page 30.

(2) Contains multiple buildings that are grouped together for reporting purposes.

(3) Represents properties sold and loans repaid prior to September 30, 2018 that are not considered discontinued operations.

(4) Unconsolidated amounts include amounts recorded in unconsolidated joint ventures for the respective category multiplied by the Company's ownership interest. The Company does not control the operations of the unconsolidated joint ventures, but

believes including these amounts in the categories indicated is meaningful to investors and analysts.

(5) Through December 1, 2016, the Company received an 11.46% current return on its $11.1 million investment in Gateway Village and, when certain other revenue criteria were met, received additional returns. The Company recognized these amounts as

NOI from this venture. After December 1, 2016, net income and cash flows were allocated 50% to each joint venture member.

(6) Represents properties included in the spin-off in the 2016 merger-spin transaction with Parkway Properties, Inc.

(7) Management Fees include reimbursement of expenses that are included in the "Reimbursed Expenses" line item.



Cousins Properties	14	Q3 2018 Supplemental Information



PORTFOLIO STATISTICS



Office Properties	Rentable Square Feet	Financial Statement Presentation	Company's Ownership Interest	End of Period Leased		Weighted Average Occupancy		% of Total Net Operating Income (1)	Property Level Debt ($000) (2)
Office Properties	Rentable Square Feet	Financial Statement Presentation	Company's Ownership Interest	3Q18	2Q18	3Q18	2Q18	% of Total Net Operating Income (1)	Property Level Debt ($000) (2)
Northpark (3)	1,539,000	Consolidated	100%	93.1%	86.4%	86.6%	84.8%	7.6%	$	—
864 Spring Street	506,000	Consolidated	100%	100.0%	100.0%	100.0%	100.0%	5.8%	—
Buckhead Plaza (3)	671,000	Consolidated	100%	82.8%	86.7%	83.2%	88.2%	5.4%	—
Promenade	777,000	Consolidated	100%	89.3%	93.4%	90.5%	94.1%	5.1%	99,792
Terminus (3)	1,226,000	Unconsolidated	50%	88.8%	92.7%	87.0%	87.5%	4.2%	99,927
3344 Peachtree	484,000	Consolidated	100%	92.4%	92.4%	91.5%	91.5%	3.7%	—
3350 Peachtree	413,000	Consolidated	100%	94.4%	84.9%	84.9%	85.8%	2.3%	—
3348 Peachtree	258,000	Consolidated	100%	88.0%	88.0%	86.6%	86.0%	1.8%	—
8000 Avalon	229,000	Consolidated	90%	100.0%	98.2%	75.7%	73.4%

Cousins Properties Inc (CUZ) SEC Filing 8-K Material Event for the period ending Wednesday, October 24, 2018

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