Exhibit 99.1

 

LOGO


DDR Corp.

Table of Contents

 

Section

   Page  

Earnings Release & Financial Statements

  

Press Release

     1-7  

Company Summary

  

Portfolio Summary

     8  

Capital Structure

     9  

Same Store Metrics

     10  

DDR and Retail Value Inc. Financial Information

     11  

Leasing Summary

     12-13  

Top 50 Tenants

     14  

Lease Expirations

     15  

Investments

  

Developments/Redevelopments

     16  

Transactions

     17  

Debt Summary

  

Debt Summary

     18  

Consolidated Debt Detail

     19  

Unconsolidated Debt Detail

     20-21  

Debt/Adjusted EBITDA

     22  

Unconsolidated Joint Ventures

  

Unconsolidated Joint Ventures

     23-25  

Shopping Center Summary

  

Top 20 MSA Exposure

     26  

Property List

     27-34  

Reporting Policies and Other

Notable Accounting and Supplemental Policies

     35-36  

Non-GAAP Measures and Reconciliations

     37-39  

Leasing Metrics for Wholly-Owned and Unconsolidated Joint Ventures at 100%

     40-44  

DDR considers portions of this information to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to the Company’s expectations for future periods. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not historical fact may be deemed to be forward-looking statements. There are a number of important factors that could cause our results to differ materially from those indicated by such forward-looking statements, including among other factors, property damage, expenses related thereto and other business and economic consequences (including the potential loss of rental revenues) resulting from extreme weather conditions in locations where we own properties, and the ability to estimate accurately the amounts thereof; sufficiency and timing of any insurance recovery payments related to damages from extreme weather conditions; local conditions such as supply of space or a reduction in demand for real estate in the area; competition from other available space; dependence on rental income from real property; the loss of, significant downsizing of or bankruptcy of a major tenant; redevelopment and construction activities may not achieve a desired return on investment; our ability to buy or sell assets on commercially reasonable terms; our ability to complete acquisitions or dispositions of assets under contract; our ability to secure equity or debt financing on commercially acceptable terms or at all; our ability to enter into definitive agreements with regard to our financing and joint venture arrangements or our failure to satisfy conditions to the completion of these arrangements; the success of our deleveraging strategy; any change in strategy; our ability to complete our previously announced plan to spin-off certain of our assets in a timely manner; the impact of such spin-off on our business and that of the spun-off company; and the ability of the Company and the spin-off company to execute their respective strategies following consummation of the spin-off, including the ability of the spin-off company to sell assets on commercially reasonable terms; entering into management agreements with RVI on commercially reasonable terms; and the finalization of the financial statements for the period ended March 31, 2018. For additional factors that could cause the results of the Company to differ materially from these indicated in the forward-looking statements, please refer to the Company’s Form 10-K for the year ended December 31, 2017. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.


LOGO

For immediate release:

DDR REPORTS FIRST QUARTER 2018 OPERATING RESULTS

BEACHWOOD, OHIO, April 24, 2018 – DDR Corp. (NYSE: DDR) today announced operating results for the quarter ended March 31, 2018.

“I am thrilled with our progress in the first quarter, both operationally and with the execution of our strategic transformation through the planned spin-off of RVI. Our strong same store NOI and operating FFO results were ahead of our budget, and demonstrate the strength of our high-quality portfolio. The completion of the securitization of the $1.35 billion mortgage loan secured by the RVI assets represented the last significant hurdle ahead of the expected July spin-off. Finally, we closed the disposition of our first RVI asset at a compelling price, an auspicious beginning for the execution of RVI’s business plan,” commented David R. Lukes, president and chief executive officer.

Results for the Quarter

 

    First quarter net loss attributable to common shareholders was $62.5 million, or $0.17 per diluted share, as compared to net loss of $59.8 million, or $0.16 per diluted share, in the year ago-period. The year-over-year increase in net loss is primarily attributable to debt extinguishment charges and transaction costs of $61.6 million partially offset by lower impairment charges and the reserve on preferred equity interests in 2017.

 

    First quarter operating funds from operations attributable to common shareholders (“Operating FFO” or “OFFO”) was $97.8 million, or $0.26 per diluted share, compared to $108.5 million, or $0.30 per diluted share, in the year ago-period. The year-over-year decrease in OFFO is primarily attributable to the dilutive impact of deleveraging asset sales partially offset by a reduction in general and administrative expenses.

Significant First Quarter Activity

 

    Sold 15 shopping centers and land parcels for an aggregate sales price of $365.9 million, totaling $208.7 million at DDR’s share, including $36.1 million from the repayment of the Company’s preferred equity investment in its two joint ventures with Blackstone.

 

    In February 2018, in connection with the previously announced planned spin-off of 38 continental U.S. assets and all 12 Puerto Rico assets into RVI, completed $1.35 billion of mortgage financing and repaid $452 million of mortgage debt, $900 million aggregate principal amount of senior unsecured notes and $200 million of unsecured term loan using proceeds from the new financing and asset sales. DDR recorded approximately $5.2 million of costs related to the planned RVI spin-off in the first quarter of 2018.

 

    Sold Silver Spring Square in Harrisburg, PA, for $80.8 million on April 17, 2018 marking the completion of the first RVI asset sale.

Key Quarterly Operating Results

 

    Reported 2.6% same store net operating income growth on a pro rata basis for New DDR. The results of “New DDR” represent the results of the assets that will remain in DDR after the completion of both the spin-off of RVI and the previously announced $900 million disposition program.

 

    Generated new leasing spreads of 21.2% and renewal leasing spreads of 6.4%, both on a pro rata basis for New DDR for the quarter, and new leasing spreads of 21.6% and renewal leasing spreads of 7.2%, both on a pro rata basis for New DDR for the trailing twelve-month period.

 

    Reported a leased rate of 93.7% at March 31, 2018 for New DDR on a pro rata basis, compared to 93.6% at December 31, 2017.

 

    Annualized base rent per occupied square foot on a pro rata basis was $17.29 at March 31, 2018 for New DDR, compared to $17.00 at March 31, 2017.

 

1


Guidance

There has been no change in the Company’s Operating FFO per share guidance since the initial release on February 15, 2018 and the related assumptions. The Company continues to estimate Operating FFO for the third quarter of 2018 to be at least $0.15 per diluted share, after an assumed spin-off date of July 2018.

Reconciliation of Net Income Attributable to DDR to FFO and Operating FFO Estimate

 

     3Q2018E
Per Share - Diluted
 

Net income attributable to Common Shareholders

     $0.02 - $0.03  

Depreciation and amortization of real estate

     0.11 - 0.13  

Equity in net income of JVs

     (0.01

JVs’ FFO

     0.02  

FFO (NAREIT) and Operating FFO

     $0.15  

About DDR Corp.

DDR is an owner and manager of 258 value-oriented shopping centers representing 89 million square feet in 32 states and Puerto Rico. The Company owns a high-quality portfolio of open-air shopping centers in major metropolitan areas that provide a highly-compelling shopping experience and merchandise mix for retail partners and consumers. The Company actively manages its assets with a focus on creating long-term shareholder value. DDR is a self-administered and self-managed REIT operating as a fully integrated real estate company, and is publicly traded on the New York Stock Exchange under the ticker symbol DDR. Additional information about the Company is available at www.ddr.com.

Conference Call and Supplemental Information

The Company will hold its quarterly conference call today at 5:00 p.m. Eastern Time. To participate with access to the slide presentation, please visit the Investors portion of DDR’s website, ir.ddr.com, or for audio only, dial 888-317-6003 (U.S.), 866-284-3684 (Canada) or 412-317-6061 (international) using pass code 3646421 at least ten minutes prior to the scheduled start of the call. A replay of the conference call will also be available at ir.ddr.com for one year after the call. A copy of the Company’s Supplemental package is available on the Company’s website.

Non-GAAP Measures

FFO is a supplemental non-GAAP financial measure used as a standard in the real estate industry and is a widely accepted measure of real estate investment trust (“REIT”) performance. Management believes that both FFO and Operating FFO provide additional indicators of the financial performance of a REIT. The Company also believes that FFO and Operating FFO more appropriately measure the core operations of the Company and provide benchmarks to its peer group.

FFO is generally defined and calculated by the Company as net income (loss), adjusted to exclude: (i) preferred share dividends, (ii) gains and losses from disposition of depreciable real estate property and related investments, which are presented net of taxes, (iii) impairment charges on depreciable real estate property and related investments and (iv) certain non-cash items. These non-cash items principally include real property depreciation and amortization of intangibles, equity income (loss) from joint ventures and equity income (loss) from non-controlling interests and adding the Company’s proportionate share of FFO from its unconsolidated joint ventures and non-controlling interests, determined on a consistent basis. The Company’s calculation of FFO is consistent with the NAREIT definition. The Company calculates Operating FFO by excluding certain non-operating charges and gains. Operating FFO is useful to investors as the Company removes non-comparable charges and gains to analyze the results of its operations and assess performance of the core operating real estate portfolio. Other real estate companies may calculate FFO and Operating FFO in a different manner.

The Company also uses net operating income (“NOI”), a non-GAAP financial measure, as a supplemental performance measure. NOI is calculated as property revenues less property-related expenses. The Company believes NOI provides useful information to investors regarding the Company’s financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level and, when compared across periods, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and disposition activity on an unleveraged basis.

 

2


The Company presents NOI information herein on a same store basis or “SSNOI.” The Company defines SSNOI as property revenues less property-related expenses, which exclude straight-line rental income and expenses, lease termination income, management fee expense, fair market value of leases and expense recovery adjustments. SSNOI also excludes activity associated with development and major redevelopment and includes assets owned in comparable periods (15 months for quarter comparisons). In addition, due to the impact of Hurricane Maria on its properties in Puerto Rico in 2017, the Company also excludes its Puerto Rico NOI from SSNOI. SSNOI excludes all non-property and corporate level revenue and expenses. Other real estate companies may calculate NOI and SSNOI in a different manner. The Company believes SSNOI provides investors with additional information regarding the operating performances of comparable assets because it excludes certain non-cash and non-comparable items as noted above.

FFO, Operating FFO, NOI and SSNOI do not represent cash generated from operating activities in accordance with GAAP, are not necessarily indicative of cash available to fund cash needs and should not be considered as alternatives to net income computed in accordance with GAAP as indicators of the Company’s operating performance or as alternatives to cash flow as a measure of liquidity. Reconciliations of these non-GAAP measures to their most directly comparable GAAP measures are included in this release and the accompanying financial supplement.

Safe Harbor

DDR Corp. considers portions of the information in this press release to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to the Company’s expectation for future periods. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not historical fact may be deemed to be forward-looking statements. There are a number of important factors that could cause our results to differ materially from those indicated by such forward-looking statements, including, among other factors, property damage, expenses related thereto and other business and economic consequences (including the potential loss of rental revenues) resulting from extreme weather conditions in locations where we own properties, and the ability to estimate accurately the amounts thereof; sufficiency and timing of any insurance recovery payments related to damages from extreme weather conditions; local conditions such as supply of space or a reduction in demand for real estate in the area; competition from other available space; dependence on rental income from real property; the loss of, significant downsizing of or bankruptcy of a major tenant; redevelopment and construction activities may not achieve a desired return on investment; our ability to buy or sell assets on commercially reasonable terms; our ability to complete acquisitions or dispositions of assets under contract; our ability to secure equity or debt financing on commercially acceptable terms or at all; our ability to enter into definitive agreements with regard to our financing and joint venture arrangements or our failure to satisfy conditions to the completion of these arrangements; the success of our deleveraging strategy; any change in strategy; our ability to complete our previously announced plan to spin-off certain of our assets in a timely manner; the impact of such spin-off on our business and that of the spun-off company; and the ability of the Company and the spin-off company to execute their respective strategies following consummation of the spin-off, including the ability of the spin-off company to sell assets on commercially reasonable terms; entering into management agreements with RVI on commercially reasonable terms; and the finalization of the financial statements for the period ended March 31, 2018. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements, please refer to the Company’s Form 10-K for the year ended December 31, 2017. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

 

3


DDR Corp.

Income Statement: Consolidated Interests

 

    $ in thousands, except per share       
         1Q18     1Q17  
 

Revenues (1):

    
 

Minimum rents (2)

   $ 146,887     $ 167,229  
 

Percentage rent

     1,808       1,699  
 

Recoveries

     51,354       57,476  
 

Other property revenues (3)

     4,908       4,577  
 

Business interruption income

     2,000       0  
    

 

 

   

 

 

 
       206,957       230,981  
 

Expenses (4):

    
 

Operating and maintenance

     29,757       32,991  
 

Real estate taxes

     32,023       34,329  
    

 

 

   

 

 

 
       61,780       67,320  
 

Net operating income

     145,177       163,661  
 

Other income (expense):

    
 

Fee income

     8,111       9,440  
 

Interest income

     5,341       8,392  
 

Interest expense

     (44,040     (51,827
 

Depreciation and amortization

     (74,424     (90,884
 

General and administrative (5)

     (16,115     (31,072
 

Other income (expense), net (6)

     (61,607     (4
 

Impairment charges

     (30,444     (21,973
 

Hurricane casualty loss

     (750     0  
    

 

 

   

 

 

 
 

Loss before earnings from JVs and other

     (68,751     (14,267
 

Equity in net income (loss) of JVs

     8,786       (1,665
 

Reserve of preferred equity interests

     (3,961     (76,000
 

Tax benefit (expense)

     18       (223
 

Gain on disposition of real estate, net

     10,011       38,127  
    

 

 

   

 

 

 
 

Net loss

     (53,897     (54,028
 

Non-controlling interests

     (256     (213
    

 

 

   

 

 

 
 

Net loss DDR

     (54,153     (54,241
 

Preferred dividends

     (8,383     (5,594
 

Net loss Common Shareholders

   ($ 62,536   ($ 59,835
 

Weighted average shares – Basic & Diluted – EPS

     369,120       366,430  
 

Earnings per common share – Basic & Diluted

   ($ 0.17   ($ 0.16
  Revenue items:     
(1)  

Lost revenue related to hurricanes

   ($ 3,784   $ 0  
(2)  

Ground lease revenue

     9,970       10,892  
(3)  

Lease termination fees

     521       178  
(4)  

Operating expenses:

    
 

Recoverable expenses

     (57,579     (62,117
 

Non-recoverable expenses

     (4,104     (4,280
 

Bad debt expense

     (97     (923
(5)  

General and administrative expenses:

    
 

Separation charges

     0       (11,471
 

Internal leasing expenses

     (1,196     (1,592
 

Construction administrative costs (capitalized)

     1,370       2,388  
(6)  

Other income (expense), net

    
 

Debt extinguishment costs, net

     (56,432     0  
 

Transaction and other (income) expense, net

     (5,175     (4
    

 

 

   

 

 

 
       (61,607     (4

 

4


DDR Corp.

Reconciliation: Net (Loss) Income to FFO and Operating FFO

and Other Financial Information

 

    $ in thousands, except per share       
         1Q18     1Q17  
 

Net loss attributable to Common Shareholders

   ($ 62,536   ($ 59,835
 

Depreciation and amortization of real estate

     72,859       88,649  
 

Equity in net (income) loss of JVs

     (8,786     1,665  
 

JVs’ FFO

     7,170       6,582  
 

Non-controlling interests

     53       76  
 

Impairment of depreciable real estate

     30,444       21,973  
 

Gain on disposition of depreciable real estate, net

     (9,688     (36,898
    

 

 

   

 

 

 
 

FFO attributable to Common Shareholders

   $ 29,516     $ 22,212  
 

Reserve of preferred equity interests

     3,961       76,000  
 

Hurricane casualty loss (1)

     2,535       0  
 

Separation charges

     0       11,471  
 

Debt extinguishment, transaction, other, net

     61,607       (1
 

Joint ventures—debt extinguishment, transaction, other

     454       80  
 

Gain on disposition of non-depreciable real estate, net

     (323     (1,229
    

 

 

   

 

 

 
 

Total non-operating items, net

     68,234       86,321  
    

 

 

   

 

 

 
 

Operating FFO attributable to Common Shareholders

   $ 97,750     $ 108,533  
 

Weighted average shares and units – Basic – FFO & OFFO

     369,471       366,976  
 

Assumed conversion of dilutive securities

     15       89  
    

 

 

   

 

 

 
 

Weighted average shares and units – Diluted – FFO & OFFO

     369,486       367,065  
 

FFO per share – Basic & Diluted

   $ 0.08     $ 0.06  
 

Operating FFO per share – Basic & Diluted

   $ 0.26     $ 0.30  
 

Common stock dividends declared, per share

   $ 0.19     $ 0.19  
 

Certain non-cash items (DDR share):

    
 

Straight-line rent, net

   ($ 380   $ 433  
 

Amortization of (above)/below-market rent, net

     1,843       3,851  
 

Straight-line ground rent (expense) income

     (50     269  
 

Debt fair value and loan cost amortization

     (2,473     (990
 

Capitalized interest expense

     323       398  
 

Stock compensation expense

     (1,692     (1,908
 

Non-real estate depreciation expense

     (1,523     (2,135
 

Non-cash interest income

     0       1,283  
 

Capital expenditures (DDR share):

    
 

Development and redevelopment costs

     20,474       9,655  
 

Maintenance capital expenditures

     521       824  
 

Tenant allowances and landlord work

     9,418       18,124  
 

Leasing commissions

     897       859  
(1)  

Hurricane casualty loss (DDR Share):

    
 

Lost tenant revenue

     (3,784     0  
 

Business interruption income

     2,000       0  
 

Clean up costs and other expenses, net

     (751     0  
    

 

 

   

 

 

 
       (2,535     0  

 

5


DDR Corp.

Balance Sheet: Consolidated Interests

 

    $ in thousands             
         At Period End  
         1Q18     4Q17  
  Assets:     
  Land    $ 1,700,502     $ 1,738,792  
 

Buildings

     5,599,708       5,733,451  
 

Fixtures and tenant improvements

     696,787       693,280  
    

 

 

   

 

 

 
       7,996,997       8,165,523  
 

Depreciation

     (1,963,427     (1,953,479
    

 

 

   

 

 

 
       6,033,570       6,212,044  
 

Construction in progress and land

     77,033       82,480  
    

 

 

   

 

 

 
 

Real estate, net

     6,110,603       6,294,524  
 

Investments in JVs

     96,734       106,037  
 

Receivable – preferred equity interests, net

     236,925       277,776  
 

Cash

     16,560       92,611  
 

Restricted cash

     49,257       2,113  
 

Notes receivable, net

     19,675       19,675  
 

Receivables, net (1)

     100,464       108,695  
 

Casualty insurance receivable

     65,547       58,583  
 

Intangible assets, net

     167,834       182,407  
 

Other assets, net

     46,847       27,652  
    

 

 

   

 

 

 
 

Total Assets

     6,910,446       7,170,073  
 

Liabilities and Equity:

    
 

Revolving credit facilities

     120,000       0  
 

Unsecured debt

     1,917,833       2,810,100  
 

Unsecured term loan

     198,452       398,130  
 

Secured debt

     1,505,235       641,082  
    

 

 

   

 

 

 
       3,741,520       3,849,312  
 

Dividends payable

     78,687       78,549  
 

Other liabilities (2)

     317,916       344,774  
    

 

 

   

 

 

 
 

Total Liabilities

     4,138,123       4,272,635  
 

Preferred shares

     525,000       525,000  
 

Common shares

     36,934       36,851  
 

Paid-in capital

     5,522,874       5,513,197  
 

Distributions in excess of net income

     (3,315,974     (3,183,134
 

Deferred compensation

     7,668       8,777  
 

Other comprehensive income

     (1,311     (1,106
 

Common shares in treasury at cost

     (7,774     (8,653
 

Non-controlling interests

     4,906       6,506  
    

 

 

   

 

 

 
  Total Equity      2,772,323       2,897,438  
    

 

 

   

 

 

 
 

Total Liabilities and Equity

   $ 6,910,446     $ 7,170,073  
(1)  

Straight-line rents receivable, net

   $ 57,733     $ 59,439  
(2)  

Below-market leases, net

     123,571       127,513  

 

6


DDR Corp.

Reconciliation of Net Income Attributable to DDR to Same Store NOI (1)

 

$ in thousands                         
                

At DDR Share

(Non-GAAP)

 
     1Q18     1Q17     1Q18     1Q17  

GAAP Reconciliation:

        

Net loss attributable to DDR

   ($ 54,153   ($ 54,241   ($ 54,153   ($ 54,241

Fee income

     (8,111     (9,440     (8,111     (9,440

Interest income

     (5,341     (8,392     (5,341     (8,392

Interest expense

     44,040       51,827       44,040       51,827  

Depreciation and amortization

     74,424       90,884       74,424       90,884  

General and administrative

     16,115       31,072       16,115       31,072  

Other expense, net

     61,607       4       61,607       4  

Impairment charges

     30,444       21,973       30,444       21,973  

Hurricane casualty loss

     750       0       750       0  

Equity in net income (loss) of joint ventures

     (8,786     1,665       (8,786     1,665  

Reserve of preferred equity interests

     3,961       76,000       3,961       76,000  

Tax (benefit) expense

     (18     223       (18     223  

Gain on disposition of real estate

     (10,011     (38,127     (10,011     (38,127

Income from non-controlling interests

     256       213       256       213  
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated NOI

     145,177       163,661       145,177       163,661  

DDR’s consolidated JV

     0       0       (398     (410
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated NOI, net of non-controlling interests

     145,177       163,661       144,779       163,251  

Net income (loss) from unconsolidated joint ventures

     23,405       (52,377     8,452       (5,237

Interest expense

     24,243       30,130       3,749       4,883  

Depreciation and amortization

     39,677       45,096       5,181       5,548  

Impairment charges

     16,910       52,657       846       6,260  

Preferred share expense

     6,508       8,128       325       406  

Other expense, net

     7,421       6,573       1,289       1,073  

(Gain) loss on disposition of real estate, net

     (38,020     173       (7,448     8  
  

 

 

   

 

 

   

 

 

   

 

 

 

Unconsolidated NOI

     80,144       90,380       12,394       12,941  

Total Consolidated + Unconsolidated NOI

     225,321       254,041       157,173       176,192  

Less: Non-Same Store NOI adjustments including Puerto Rico NOI

     (34,068     (64,224     (30,594     (51,511
  

 

 

   

 

 

   

 

 

   

 

 

 

Total SSNOI

   $ 191,253     $ 189,817     $ 126,579     $ 124,681  

Less: RVI – continental U.S. and disposition assets

     (37,794     (38,158     (37,794     (38,158
  

 

 

   

 

 

   

 

 

   

 

 

 

Total New DDR SSNOI

   $ 153,459     $ 151,659     $ 88,785     $ 86,523  

SSNOI % Change – DDR at share (excluding Puerto Rico)

     0.8       1.5  

SSNOI % Change – New DDR at share

     1.2       2.6  

 

(1) Excludes major redevelopment activity; see Investments section for additional detail. See calculation definition in the Non-GAAP Measures section.

 

7


DDR Corp.

Portfolio Summary

 

GLA in thousands                               
     3/31/2018     12/31/2017     9/30/2017     6/30/2017     3/31/2017  

Shopping Center Count

          

Operating Centers—100%

     258       273       286       298       309  

Wholly Owned—DDR (ex RVI as of 4Q17)

     82       86       131       136       144  

JV Portfolio

     126       137       143       150       151  

Wholly Owned RVI—continental U.S.

     38       38       n/a       n/a       n/a  

Wholly Owned—Puerto Rico (RVI as of 4Q17)

     12       12       12       12       14  

Gross Leasable Area (GLA)

          

Owned and Ground Lease—100%

     65,254       67,410       71,118       72,686       74,400  

Owned and Ground Lease—DDR Share

     43,999       45,118       47,039       48,053       49,633  

Wholly Owned—DDR (ex RVI as of 4Q17)

     23,535       24,476       38,314       39,307       40,515  

JV Portfolio—DDR Share

     3,994       4,167       4,284       4,305       4,311  

Wholly Owned—RVI—continental U.S.

     12,040       12,034       n/a       n/a       n/a  

Wholly Owned—Puerto Rico (RVI as of 4Q17)

     4,431       4,441       4,441       4,441       4,807  

Unowned—100%

     23,604       24,758       26,104       27,352       28,586  
  

 

 

 

Quarterly Operational Overview

          

DDR Share

          

Base Rent PSF

   $ 16.49     $ 16.46     $ 16.16     $ 16.09     $ 15.83  

Base Rent PSF < 10K

   $ 27.29     $ 27.11     $ 26.93     $ 26.72     $ 26.43  

Base Rent PSF > 10K

   $ 13.41     $ 13.36     $ 13.09     $ 13.01     $ 12.83  

Leased Rate

     92.9     93.2     93.4     93.7     94.3

Commenced Rate

     90.8     91.3     91.4     91.5     92.5

Leased Rate < 10K SF

     87.1     87.6     87.8     87.9     88.3

Leased Rate > 10K SF

     94.6     94.9     95.1     95.4     96.2

Wholly Owned DDR (ex RVI as of 4Q17)

          

Base Rent PSF

   $ 17.52     $ 17.41     $ 15.87     $ 15.79     $ 15.49  

Leased Rate

     93.6     93.5     93.7     94.0     94.7

Leased Rate < 10K SF

     90.7     90.3     89.1     89.4     89.5

Leased Rate > 10K SF

     94.5     94.4     95.0     95.3     96.2

Joint Venture DDR Share

          

Base Rent PSF

   $ 15.02     $ 14.93     $ 14.81     $ 14.71     $ 14.63  

Leased Rate

     93.3     93.6     93.3     93.8     94.6

Leased Rate < 10K SF

     85.4     86.3     86.1     86.2     87.7

Leased Rate > 10K SF

     96.2     96.4     96.0     96.6     97.2

Wholly Owned RVI—continental U.S.

          

Base Rent PSF

   $ 13.63     $ 13.60       n/a       n/a       n/a  

Leased Rate

     93.4     93.6     n/a       n/a       n/a  

Leased Rate < 10K SF

     85.0     86.4     n/a       n/a       n/a  

Leased Rate > 10K SF

     95.8     95.6     n/a       n/a       n/a  

Wholly Owned —Puerto Rico (RVI as of 4Q17)

          

Base Rent PSF

   $ 20.89     $ 21.12     $ 20.60     $ 20.82     $ 20.31  

Leased Rate

     87.0     89.6     90.7     90.4     90.9

Leased Rate < 10K SF

     79.3     80.6     81.3     80.5     82.0

Leased Rate > 10K SF

     90.7     93.9     95.1     95.1     95.1
  

 

 

 

Operational Statistics

          

% of Aggregate Property NOI—Wholly Owned – DDR Share

     90.6     90.5     91.6     91.7     91.9

% of Aggregate Property NOI—Joint Venture – DDR Share

     9.4     9.5     8.4     8.3     8.1

Same Store NOI

          

DDR at share (excluding Puerto Rico)

     1.5     -0.4     0.0     0.0     0.5

New DDR at share

     2.6     0.8     n/a       n/a       n/a  

TTM Total Leasing—DDR Share (000s)

     5,987       6,663       6,730       6,710       6,175  

TTM Blended New and Renewal Rent Spreads—DDR Share

     5.9     6.0     6.1     6.9     7.8

 

8


DDR Corp.

Capital Structure

 

$, shares and units in thousands, except per share                   
     March 31, 2018     December 31, 2017     December 31, 2016  

Capital Structure

      

Market Value Per Share

   $ 7.33     $ 8.96     $ 15.27  

Common Shares Outstanding

     369,272       368,474       366,264  

Operating Partnership Units

     281       372       399  
  

 

 

   

 

 

   

 

 

 

Total Outstanding Common Shares

     369,553       368,846       366,663  

Common Shares Equity

   $ 2,708,824     $ 3,304,857     $ 5,598,939  

Perpetual Preferred Stock—Class J

     200,000       200,000       200,000  

Perpetual Preferred Stock—Class K

     150,000       150,000       150,000  

Perpetual Preferred Stock—Class A

     175,000       175,000       0  
  

 

 

   

 

 

   

 

 

 

Total Perpetual Preferred Stock

   $ 525,000     $ 525,000     $ 350,000  

Unsecured Credit Facilities

     120,000       0       0  

Unsecured Term Loan

     200,000       400,000       400,000  

Unsecured Notes Payable

     1,929,635       2,827,052       2,927,185  

Mortgage Debt (includes JVs at DDR share)

     1,861,258       988,740       1,382,483  
  

 

 

   

 

 

   

 

 

 

Total Debt (includes JVs at DDR share)

     4,110,893       4,215,792       4,709,668  

Less: Cash (including restricted cash)

     65,817       94,724       39,225  
  

 

 

   

 

 

   

 

 

 

Net Debt

   $ 4,045,076     $ 4,121,068     $ 4,670,443  

Total Market Capitalization

   $ 7,278,900     $ 7,950,925     $ 10,619,382  
  

 

 

 
      

Leverage / Public Debt Covenants

      

Consolidated Net Effective Debt

     3,710,468       3,763,739       4,457,227  

Consolidated Adjusted EBITDA—annualized

     605,996       622,576       683,852  
  

 

 

   

 

 

   

 

 

 

Consolidated Net Debt / Adjusted EBITDA (1)

     6.1X       6.0X       6.5X  

Pro-Rata Net Effective Debt

     4,032,284       4,102,455       4,863,392  

Pro-Rata Adjusted EBITDA—annualized

     621,152       637,736       705,480  
  

 

 

   

 

 

   

 

 

 

Pro-Rata Net Debt / Adjusted EBITDA (1)

     6.5X       6.4X       6.9X  

Outstanding Debt & Obligations

     3,802,649       3,884,947       4,533,536  

Undepreciated Real Estate Assets

     8,407,689       8,631,815       9,698,190  
  

 

 

   

 

 

   

 

 

 

Total Debt to Real Estate Assets Ratio

     45     45     47

Covenant

     65     65     65

Secured Debt & Obligations

     1,535,687       640,553       1,183,277  

Total Assets

     8,866,505       9,115,651       10,188,963  
  

 

 

   

 

 

   

 

 

 

Secured Debt to Assets Ratio

     17     7     12

Covenant

     40     40     40

Unencumbered Real Estate Assets

     4,839,278       6,973,787       7,066,505  

Unsecured Debt & Obligations

     2,266,961       3,244,394       3,350,259  
  

 

 

   

 

 

   

 

 

 

Unencumbered Assets to Unsecured Debt

     213     215     211

Covenant

     135     135     135

Net Income Available for Debt Service

     497,240       560,295       692,499  

Maximum Annual Service Charge

     204,754       217,754       257,057  
  

 

 

   

 

 

   

 

 

 

Fixed Charge Coverage Ratio

     2.4X       2.6X       2.7X  

Covenant

     1.5X       1.5X       1.5X  

Net Income Available for Debt Service Excluding Debt Extinguishment Costs

     609,133       623,575       692,982  

Fixed Charge Coverage Ratio Excluding Debt Extinguishment Costs

     3.0X       2.9X       2.7X  
  

 

 

 
      

Credit Ratings (Outlook)

      

Moody’s

     Baa3 (Stable     Baa3 (Stable     Baa2 (Stable

S&P

     BBB- (Stable     BBB- (Stable     BBB- (Stable

Fitch

     BBB- (Positive     BBB- (Positive     BBB- (Stable

 

(1) Excludes Perpetual Preferred Stock. See definition in the Non-GAAP Measures section.    

 

9


DDR Corp.

Same Store Metrics (1)

 

$ in thousands                                
     Same Store at 100%     Same Store at DDR Share  

DDR at share (excluding Puerto Rico)

     1Q18       1Q17       Change       1Q18       1Q17       Change  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Leased Rate

     92.9     94.1     (1.2 %)      92.9     94.1     (1.2 %) 

Commenced Rate

     91.0     92.4     (1.4 %)      91.0     92.6     (1.6 %) 

Revenues:

            

Base Rents

   $ 201,382     $ 200,486       0.4   $ 132,612     $ 131,543       0.8

Recoveries

     67,165       67,622       (0.7 %)      45,261       46,061       (1.7 %) 

Other

     2,308       2,081       10.9     1,420       1,345       5.6
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     270,855       270,189       0.2     179,293       178,949       0.2

Expenses:

            

Operating

     (34,915     (35,817     (2.5 %)      (22,649     (23,587     (4.0 %) 

Real Estate Taxes

     (43,908     (43,810     0.2     (29,785     (30,088     (1.0 %) 

Bad Debt Expense

     (779     (745     4.6     (280     (593     (52.8 %) 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     (79,602     (80,372     (1.0 %)      (52,714     (54,268     (2.9 %) 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total SSNOI (2)

   $ 191,253     $ 189,817       0.8   $ 126,579     $ 124,681       1.5

Non-Same Store NOI including Puerto Rico NOI (3)

     34,068       64,224         30,594       51,511    
  

 

 

   

 

 

     

 

 

   

 

 

   

Total Consolidated + Unconsolidated NOI

   $ 225,321     $ 254,041       $ 157,173     $ 176,192    
     Same Store at 100%     Same Store at DDR Share  

New DDR at share

     1Q18       1Q17       Change       1Q18       1Q17       Change  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Leased Rate

     93.3     94.1     (0.8 %)      93.7     94.0     (0.3 %) 

Commenced Rate

     90.7     91.6     (0.9 %)      90.4     91.4     (1.0 %) 

Revenues:

            

Base Rents

   $ 161,924     $ 160,602       0.8   $ 93,154     $ 91,659       1.6

Recoveries

     53,116       53,114       0.0     31,212       31,554       (1.1 %) 

Other

     2,058       1,868       10.2     1,170       1,132       3.4
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     217,098       215,584       0.7     125,536       124,345       1.0

Expenses:

            

Operating

     (28,146     (28,912     (2.6 %)      (15,880     (16,682     (4.8 %) 

Real Estate Taxes

     (34,677     (34,615     0.2     (20,554     (20,894     (1.6 %) 

Bad Debt Expense

     (816     (398     105.0     (317     (246     28.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     (63,639     (63,925     (0.4 %)      (36,751     (37,822     (2.8 %) 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total SSNOI

   $ 153,459     $ 151,659       1.2   $ 88,785     $ 86,523       2.6

 

(1) See calculation definition in the Non-GAAP Measures section. Excludes impact of all hurricane related lost revenues, costs and bad debt expense.
(2) Excludes 12 assets in Puerto Rico.
(3) See Investments section for detail on major redevelopment activity. Includes results of Puerto Rico. Represents 19.5% of 1Q18 total NOI at DDR share.

 

10


DDR Corp.

DDR and Retail Value Inc. Financial Information

 

$ in thousands                         
     Income Statement — 1Q18  
     Consolidated     RVI     DDR  
     DDR - Ex RVI (1)     continental U.S.     Puerto Rico     As Reported (2)  

Revenues:

        

Minimum rents

   $ 95,286     $ 36,949     $ 14,652     $ 146,887  

Percentage rent

     731       224       853       1,808  

Recoveries

     32,634       13,163       5,557       51,354  

Other property revenues

     2,046       630       2,232       4,908  

Business interruption income

     0       0       2,000       2,000  
  

 

 

   

 

 

   

 

 

   

 

 

 
     130,697       50,966       25,294       206,957  

Expenses:

        

Operating and maintenance

     17,749       6,474       5,534       29,757  

Real estate taxes

     22,129       8,702       1,192       32,023  
  

 

 

   

 

 

   

 

 

   

 

 

 
     39,878       15,176       6,726       61,780  

Net operating income (3)

   $ 90,819     $ 35,790     $ 18,568     $ 145,177  

Certain non-cash items:

        

Straight-line rent, net

   ($ 127   $ 137     ($ 384   ($ 374

Amortization of (above)/below-market rent, net

     1,166       535       79       1,780  

Straight-line ground rent income (expense)

     (36     (2     0       (38

Capital expenditures:

        

Development and redevelopment costs

     15,287       2,489       2,690       20,466  

Maintenance capital expenditures

     351       30       53       434  

Tenant allowances and landlord work

     5,273       3,294       21       8,588  

Leasing commissions

     660       195       0       855  
     Balance Sheet — March 31, 2018        
     Consolidated           DDR        
     DDR - Ex RVI (1)     RVI     As Reported (2)        

Assets:

        

Land

   $ 989,191     $ 711,311     $ 1,700,502    

Buildings

     3,696,050       1,903,658       5,599,708    

Fixtures and tenant improvements

     499,943       196,844       696,787    
  

 

 

   

 

 

   

 

 

   
     5,185,184       2,811,813       7,996,997    

Depreciation

     (1,248,976     (714,451     (1,963,427  
  

 

 

   

 

 

   

 

 

   
     3,936,208       2,097,362       6,033,570    

Construction in progress and land

     68,501       8,532       77,033    
  

 

 

   

 

 

   

 

 

   

Real estate, net

   $ 4,004,709     $ 2,105,894     $ 6,110,603    

Number of assets at period end (4)

     83       50       133    

 

(1) Includes NOI from assets sold in the quarter as well as NOI and real estate assets from properties expected to be sold as part of the Company’s $900 million disposition program. Excludes DDR’s share of joint venture NOI of $12.4 million as reported in Unconsolidated Joint Ventures section.
(2) Represents DDR Corp. as presented elsewhere herein.
(3) See definition and reconciliation in Non-GAAP Measures section presented elsewhere herein.
(4) Does not include 125 assets owned through unconsolidated joint ventures. Includes one consolidated joint venture asset in which the Company has an effective 67% interest.

 

11


DDR Corp.

Leasing Summary

At DDR share except for count

 

Leasing Activity                                                                            
     Comparable Pool             Total Pool  
     Count      GLA     

New

Rent

PSF

    

Prior

Rent

PSF

    

Rent

Spread

   

Wtd Avg

Term

(Years)

            Count      GLA     

New

Rent

PSF

    

Wtd Avg

Term

(Years)

 
  

 

 

 

New Leases

                               

1Q18

     34        69,370      $ 23.81      $ 19.94        19.4     7.6           68        266,988      $ 17.72        8.8  

4Q17

     44        178,799      $ 22.10      $ 17.83        23.9     9.3           92        306,057      $ 20.85        9.3  

3Q17

     35        75,716      $ 21.18      $ 19.83        6.8     8.3           76        258,889      $ 18.49        8.8  

2Q17

     28        147,505      $ 15.16      $ 13.78        10.0     9.2           73        410,093      $ 16.29        9.7  
  

 

 

 
     141        471,390      $ 20.03      $ 17.19        16.5     8.8           309        1,242,027      $ 18.18        9.2  

Renewals

                               

1Q18

     163        811,411      $ 15.04      $ 14.51        3.7     5.2           163        811,411      $ 15.04        5.2  

4Q17

     186        895,619      $ 17.45      $ 17.07        2.2     4.8           186        895,619      $ 17.45        4.8  

3Q17

     239        1,533,448      $ 15.63      $ 14.73        6.1     5.0           239        1,533,448      $ 15.63        5.0  

2Q17

     185        1,504,824      $ 13.77      $ 13.03        5.7     5.2           185        1,504,824      $ 13.77        5.2  
  

 

 

 
     773        4,745,302      $ 15.28      $ 14.60        4.7     5.0           773        4,745,302      $ 15.28        5.0  

New + Renewals

                               

1Q18

     197        880,781      $ 15.73      $ 14.94        5.3     5.5           231        1,078,399      $ 15.71        6.2  

4Q17

     230        1,074,418      $ 18.22      $ 17.20        5.9     5.7           278        1,201,676      $ 18.32        6.1  

3Q17

     274        1,609,164      $ 15.90      $ 14.97        6.2     5.2           315        1,792,337      $ 16.05        5.6  

2Q17

     213        1,652,329      $ 13.89      $ 13.10        6.0     5.6           258        1,914,917      $ 14.31        6.3  
  

 

 

 
     914        5,216,692      $ 15.71      $ 14.83        5.9     5.5           1,082        5,987,329      $ 15.88        6.0  

 

Net Effective Rents                                                   
     GLA      Avg
Rent
PSF
     TA
Capex
PSF
     LL Work
Capex
PSF
     Commission
Capex PSF
     Total
Capex
PSF
     Net
Effective
Rent PSF
     Wtd Avg
Term
(Years)
 
  

 

 

 

New Leases (1)

                       

1Q18

     259,946      $ 18.52      $ 2.34      $ 3.39      $ 0.49      $ 6.22      $ 12.30        8.7  

4Q17

     288,692      $ 21.71      $ 1.89      $ 2.09      $ 0.43      $ 4.41      $ 17.30        9.3  

3Q17

     189,846      $ 19.76      $ 2.17      $ 1.66      $ 0.61      $ 4.44      $ 15.32        8.5  

2Q17

     261,257      $ 17.07      $ 3.42      $ 3.79      $ 0.35      $ 7.56      $ 9.51        8.8  
  

 

 

 
     999,741      $ 19.30      $ 2.45      $ 2.79      $ 0.46      $ 5.70      $ 13.60        8.9  

Renewals

                       

1Q18

     811,411      $ 15.18      $ 0.05      $ 0.00      $ 0.00      $ 0.05      $ 15.13        5.2  

4Q17

     895,619      $ 17.57      $ 0.03      $ 0.01      $ 0.00      $ 0.04      $ 17.53        4.8  

3Q17

     1,533,448      $ 15.76      $ 0.01      $ 0.00      $ 0.00      $ 0.01      $ 15.75        5.0  

2Q17

     1,504,824      $ 13.93      $ 0.07      $ 0.00      $ 0.00      $ 0.07      $ 13.86        5.2  
  

 

 

 
     4,745,302      $ 15.42      $ 0.04      $ 0.00      $ 0.00      $ 0.04      $ 15.38        5.0  

New + Renewals

                       

1Q18

     1,071,357      $ 15.99      $ 0.84      $ 1.16      $ 0.17      $ 2.17      $ 13.82        6.2  

4Q17

     1,184,311      $ 18.58      $ 0.73      $ 0.79      $ 0.16      $ 1.68      $ 16.90        6.0  

3Q17

     1,723,294      $ 16.20      $ 0.38      $ 0.29      $ 0.11      $ 0.78      $ 15.42        5.5  

2Q17

     1,766,081      $ 14.39      $ 0.82      $ 0.85      $ 0.08      $ 1.75      $ 12.64        5.8  
  

 

 

 
     5,745,043      $ 16.10      $ 0.68      $ 0.74      $ 0.12      $ 1.54      $ 14.56        5.8  

 

(1) New Leases exclude development and redevelopment activity.

 

12


DDR Corp.

Leasing Summary – New DDR

At DDR share except for count    

 

Leasing Activity                                                                            
     Comparable Pool             Total Pool  
     Count      GLA      New
Rent
PSF
     Prior
Rent
PSF
     Rent
Spread
    Wtd Avg
Term
(Years)
            Count      GLA      New
Rent
PSF
     Wtd Avg
Term
(Years)
 

New Leases

                               

1Q18

     33        57,075      $ 24.73      $ 20.40        21.2     7.7           57        172,133      $ 19.32        8.7  

4Q17

     34        153,972      $ 21.79      $ 17.59        23.9     9.6           77        253,180      $ 20.79        9.6  

3Q17

     27        27,179      $ 29.99      $ 27.23        10.1     7.5           57        141,472      $ 21.86        8.8  

2Q17

     23        68,526      $ 17.23      $ 13.86        24.3     8.6           58        269,396      $ 17.87        9.9  
  

 

 

 
     117        306,752      $ 22.04      $ 18.13        21.6     8.8           249        836,181      $ 19.73        9.4  

Renewals

                               

1Q18

     127        458,232      $ 15.87      $ 14.92        6.4     5.2           127        458,232      $ 15.87        5.2  

4Q17

     150        550,204      $ 17.98      $ 17.07        5.3     4.9           150        550,204      $ 17.98        4.9  

3Q17

     180        770,729      $ 19.35      $ 17.89        8.2     5.1           180        770,729      $ 19.35        5.1  

2Q17

     135        674,081      $ 17.60      $ 16.28        8.1     5.1           135        674,081      $ 17.60        5.1  
  

 

 

 
     592        2,453,246      $ 17.91      $ 16.71        7.2     5.1           592        2,453,246      $ 17.91        5.1  

New + Renewals

                               

1Q18

     160        515,307      $ 16.85      $ 15.52        8.6     5.6           184        630,365      $ 16.81        6.3  

4Q17

     184        704,176      $ 18.81      $ 17.18        9.5     6.1           227        803,384      $ 18.86        6.5  

3Q17

     207        797,908      $ 19.71      $ 18.21        8.2     5.2           237        912,201      $ 19.74        5.7  

2Q17

     158        742,607      $ 17.57      $ 16.06        9.4     5.4           193        943,477      $ 17.68        6.5  
  

 

 

 
     709        2,759,998      $ 18.37      $ 16.87        8.9     5.6           841        3,289,427      $ 18.37        6.2  

 

Net Effective Rents                                                   
     GLA      Avg
Rent
PSF
     TA
Capex
PSF
     LL Work
Capex
PSF
     Commission
Capex PSF
     Total
Capex
PSF
     Net
Effective
Rent PSF
     Wtd Avg
Term
(Years)
 
  

 

 

 

New Leases (1)

                       

1Q18

     165,091      $ 20.39      $ 1.59      $ 3.30      $ 0.57      $ 5.46      $ 14.93        8.6  

4Q17

     235,815      $ 21.56      $ 1.88      $ 1.62      $ 0.42      $ 3.92      $ 17.64        9.6  

3Q17

     72,429      $ 27.41      $ 2.88      $ 4.18      $ 0.75      $ 7.81      $ 19.60        8.1  

2Q17

     120,560      $ 20.66      $ 2.57      $ 6.04      $ 0.38      $ 8.99      $ 11.67        8.7  
  

 

 

 
     593,895      $ 21.76      $ 2.06      $ 3.24      $ 0.49      $ 5.79      $ 15.97        8.9  

Renewals

                       

1Q18

     458,232      $ 16.03      $ 0.04      $ 0.00      $ 0.00      $ 0.04      $ 15.99        5.2  

4Q17

     550,204      $ 18.13      $ 0.04      $ 0.01      $ 0.00      $ 0.05      $ 18.08        4.9  

3Q17

     770,729      $ 19.54      $ 0.02      $ 0.00      $ 0.00      $ 0.02      $ 19.52        5.1  

2Q17

     674,081      $ 17.80      $ 0.06      $ 0.00      $ 0.00      $ 0.06      $ 17.74        5.1  
  

 

 

 
     2,453,246      $ 18.09      $ 0.04      $ 0.00      $ 0.00      $ 0.04      $ 18.05        5.1  

New + Renewals

                       

1Q18

     623,323      $ 17.19      $ 0.60      $ 1.20      $ 0.21      $ 2.01      $ 15.18        6.3  

4Q17

     786,019      $ 19.16      $ 0.86      $ 0.73      $ 0.19      $ 1.78      $ 17.38        6.4  

3Q17

     843,158      $ 20.22      $ 0.39      $ 0.54      $ 0.10      $ 1.03      $ 19.19        5.4  

2Q17

     794,641      $ 18.24      $ 0.64      $ 1.41      $ 0.09      $ 2.14      $ 16.10        5.7  
  

 

 

 
     3,047,141      $ 18.81      $ 0.63      $ 0.96      $ 0.14      $ 1.73      $ 17.08        5.9  

 

(1) New Leases exclude development and redevelopment activity.

 

13


DDR Corp.

Top 50 Tenants

 

$ and GLA in thousands                                          
         Number of Units     Base Rent     Owned GLA     Credit Ratings
    

 

 

    

Tenant

  WO     JV     Total     Pro Rata     % of Total     At 100%     Pro Rata     % of Total     At 100%    

(S&P/Moody’s/Fitch)

1   

TJX Companies (1)

    68       36       104     $ 27,813       4.4   $ 37,784       2,262       5.1     3,221     A+/A2/NR
2   

Bed Bath & Beyond (2)

    51       27       78       20,970       3.3     29,086       1,666       3.8     2,323     BBB/Baa2/NR
3   

PetSmart

    46       28       74       17,001       2.7     24,731       1,045       2.4     1,589     CCC+/B2/NR
4   

AMC Theatres

    7       5       12       16,144       2.6     22,310       646       1.5     936     B+/B2/B
5   

Dick’s Sporting Goods (3)

    21       16       37       15,514       2.5     23,930       1,068       2.4     1,811     NR
6   

Best Buy

    24       10       34       15,010       2.4     20,696       992       2.3     1,339     BBB/Baa1/BBB-
7   

Ross Stores (4)

    40       32       72       14,057       2.2     22,263       1,288       2.9     2,093     A-/A3/NR
8   

Kohl’s

    16       9       25       12,907       2.0     18,219       1,548       3.5     2,211     BBB-/Baa2/BBB
9   

Michaels

    36       22       58       12,553       2.0     17,535       930       2.1     1,368     BB-/NR/NR
10   

Gap (5)

    37       20       57       11,304       1.8     15,354       663       1.5     927     BB+/Baa2/BB+
11   

Walmart (6)

    12       3       15       10,202       1.6     12,833       1,597       3.6     1,922     AA/Aa2/AA
12   

Ulta

    37       18       55       9,992       1.6     13,822       416       0.9     585     NR
13   

Ascena (7)

    63       20       83       7,908       1.3     9,908       397       0.9     500     B/Ba3/NR
14   

Barnes & Noble

    14       8       22       7,836       1.2     10,752       381       0.9     544     NR
15   

Toys “R” Us (8)

    14       5       19       7,494       1.2     8,324       639       1.5     780     NR
16   

Kroger (9)

    7       11       18       6,987       1.1     10,824       590       1.3     1,067     BBB/Baa1/BBB
17   

Office Depot (10)

    20       13       33       6,822       1.1     10,284       467       1.1     701     B/B1/NR
18   

Nordstrom Rack

    10       2       12       6,686       1.1     7,881       367       0.8     431     BBB+/Baa1/BBB+
19   

Lowe’s

    7       1       8       6,568       1.0     7,339       935       2.1     1,047     A-/A3/NR
20   

Petco

    22       9       31       6,468       1.0     8,302       323       0.7     430     B-/B2/NR
21   

LA Fitness

    9       2       11       6,045       1.0     7,102       438       1.0     509     NR
22   

Jo-Ann

    16       10       26       5,845       0.9     8,437       528       1.2     807     B/B1/NR
23   

Five Below

    35       19       54       5,740       0.9     7,985       331       0.8     467     NR
24   

DSW

    15       9       24       5,579       0.9     8,180       340       0.8     514     NR
25   

Mattress Firm

    38       15       53       5,575       0.9     7,293       193       0.4     258     NR
26   

Pier 1 Imports

    21       13       34       5,525       0.9     7,736       241       0.5     349     B/NR/NR
27   

Home Depot

    6       3       9       5,343       0.8     6,818       685       1.6     1,042     A/A2/A
28   

Cinemark

    4       3       7       5,286       0.8     7,161       345       0.8     463     BB/NR/NR
29   

Regal Cinemas

    5       1       6       5,177       0.8     7,277       261       0.6     330     NR
30   

Party City

    21       15       36       4,929       0.8     7,618       278       0.6     455     NR
31   

Burlington

    8       3       11       4,903       0.8     6,546       508       1.2     735     BB/NR/NR
32   

Whole Foods

    3       2       5       4,895       0.8     5,636       208       0.5     259     A+/Baa1/NR
33   

Dollar Tree Stores

    36       25       61       4,833       0.8     7,367       414       0.9     623     BBB-/Baa3/NR
34   

AT&T

    47       18       65       4,704       0.7     5,851       123       0.3     164     BBB+/Baa1/A-
35   

Staples

    12       15       27       4,593       0.7     7,999       311       0.7     548     B+/B1/NR
36   

Hobby Lobby

    9       7       16       4,307       0.7     7,131       546       1.2     873     NR
37   

Famous Footwear

    22       9       31       3,959       0.6     4,949       192       0.4     242     BB/Ba2/NR
38   

Carter’s Childrenswear

    27       9       36       3,139       0.5     3,799       122       0.3     150     BB+/NR/NR
39   

Panera

    20       10       30       3,118       0.5     4,285       102       0.2     143     NR
40   

Tailored Brands (11)

    18       8       26       2,978       0.5     4,090       127       0.3     180     B+/NR/NR
41   

Total Wine & More

    6       4       10       2,889       0.5     4,000       159       0.4     219     NR
42   

Rainbow Apparel

    25       6       31       2,832       0.4     3,328       129       0.3     170     NR
43   

Footlocker

    20       0       20       2,814       0.4     2,814       78       0.2     78     BB+/Ba1/NR
44   

Sprint

    28       14       42       2,804       0.4     3,583       69       0.2     99     B/B2/B+
45   

Chili’s Restaurant

    18       4       22       2,796       0.4     3,323       114       0.3     135     BB+/Ba1/BB+
46   

Stein Mart

    7       6       13       2,718       0.4     4,013       302       0.7     446     NR
47   

Publix

    2       23       25       2,666       0.4     10,623       313       0.7     1,195     NR
48   

T-Mobile

    26       21       47       2,629       0.4     3,638       57       0.1     90     BB+/NR/NR
49   

L Brands (12)

    22       13       35       2,627       0.4     3,583       94       0.2     127     BB+/Ba1/BB+
50   

Giant Eagle

    2       3       5       2,587       0.4     5,289       219       0.5     449     NR
    

 

 

  

Top 50 Total

    1,080       585       1,665     $ 364,071       57.8   $ 509,631       26,047       59.2     37,944    
  

Total Portfolio

        $ 629,970       100.0   $ 902,586       43,999       100.0     65,254    

 

(1)  T.J. Maxx (35) / Marshalls (43) / HomeGoods (21) / Sierra Trading (3) / HomeSense (2)

  

(7)  Ann Taylor (4) / Catherine’s (4) / Dress Barn (23) / Justice (18) / Lane Bryant (23) / Maurice’s (10) / Roz & Ali (1)

(2)  Bed Bath (48) / World Market (19) / buybuy Baby (9) / CTS (2)

  

(8)  Toys “R” Us (4) / Babies “R” Us (12) / Toys-Babies Combo (3)

(3)  Dick’s Sporting Goods (34) / Golf Galaxy (3)

  

(9)  Kroger (10) / Harris Teeter (4) / King Soopers (1) / Pick ‘n Save (2) Mariano’s (1)

(4)  Ross Dress For Less (69) / dd’s Discounts (3)

  

(10)   Office Depot (14) / OfficeMax (19)

(5)  Gap (4) / Old Navy (51) / Banana Republic (2)

  

(11)   Men’s Wearhouse (17) / Jos. A. Bank (7) / K&G Fashion Superstore (2)

(6)  Walmart (11) / Sam’s Club (2) / Neighborhood Market (2)

  

(12)   Bath & Body Works (30) / Victoria’s Secret (5)

 

14


DDR Corp.

Lease Expirations

At DDR share except for count; $ and GLA in thousands

 

Assumes no exercise of lease options

 

               
    Greater than 10K SF           Less than 10K SF           Total  

Year

  # of
Leases
    Expiring
SF
    ABR     Rent
PSF
    % of
ABR
> 10K
          # of
Leases
    Expiring
SF
    ABR     Rent
PSF
    % of
ABR
< 10K
          # of
Leases
    Expiring
SF
    ABR     Rent
PSF
    % of
ABR
Total
 

MTM

    3       66     $ 929     $ 14.08       0.3       157       310     $ 8,480     $ 27.35       3.9       160       376     $ 9,409     $ 25.02       1.6

2018

    34       970       12,302     $ 12.68       3.3       386       632       17,177     $ 27.18       8.0       420       1,602       29,479     $ 18.40       5.0

2019

    164       3,550       42,767     $ 12.05       11.5       693       1,192       31,763     $ 26.65       14.8       857       4,742       74,530     $ 15.72       12.7

2020

    160       3,267       42,748     $ 13.08       11.5       657       1,079       29,638     $ 27.47       13.8       817       4,346       72,386     $ 16.66       12.3

2021

    203       3,945       51,985     $ 13.18       14.0       622       1,088       28,114     $ 25.84       13.1       825       5,033       80,099     $ 15.91       13.7

2022

    225       5,009       62,979     $ 12.57       17.0       594       1,068       30,123     $ 28.21       14.0       819       6,077       93,102     $ 15.32       15.9

2023

    213       4,201       54,691     $ 13.02       14.7       386       889       23,347     $ 26.26       10.9       599       5,090       78,038     $ 15.33       13.3

2024

    104       2,133       25,965     $ 12.17       7.0       199       532       13,747     $ 25.84       6.4       303       2,665       39,712     $ 14.90       6.8

2025

    64       1,173       18,133     $ 15.46       4.9       146       364       9,903     $ 27.21       4.6       210       1,537       28,036     $ 18.24       4.8

2026

    54       843       12,683     $ 15.05       3.4       140       401       11,854     $ 29.56       5.5       194       1,244       24,537     $ 19.72       4.2

2027

    52       926       14,668     $ 15.84       3.9       113       244       7,350     $ 30.12       3.4       165       1,170       22,018     $ 18.82       3.8

Thereafter

    65       1,974       31,502     $ 15.96       8.5       55       144       3,578     $ 24.85       1.7       120       2,118       35,080     $ 16.56       6.0
 

 

 

 

Total

    1,341       28,057     $ 371,352     $ 13.24       100.0       4,148       7,943     $ 215,074     $ 27.08       100.0       5,489       36,000     $ 586,426     $ 16.29       100.0

Assumes all lease options are exercised

 

               
    Greater than 10K SF           Less than 10K SF           Total  

Year

  # of
Leases
    Expiring
SF
    ABR     Rent
PSF
    % of
ABR
> 10K
          # of
Leases
    Expiring
SF
    ABR     Rent
PSF
    % of
ABR
< 10K
          # of
Leases
    Expiring
SF
    ABR     Rent
PSF
    % of
ABR
Total
 

MTM

    2       12     $ 177     $ 14.75       0.0       144       290     $ 7,938     $ 27.37       3.7       146       302     $ 8,115     $ 26.87       1.4

2018

    10       124       1,602     $ 12.92       0.4       267       398       11,598     $ 29.14       5.4       277       522       13,200     $ 25.29       2.3

2019

    23       332       4,252     $ 12.81       1.1       429       722       20,194     $ 27.97       9.4       452       1,054       24,446     $ 23.19       4.2

2020

    26       318       5,237     $ 16.47       1.4       385       579       17,483     $ 30.20       8.1       411       897       22,720     $ 25.33       3.9

2021

    27       321       5,611     $ 17.48       1.5       373       533       14,871     $ 27.90       6.9       400       854       20,482     $ 23.98       3.5

2022

    36       452       7,427     $ 16.43       2.0       343       523       15,863     $ 30.33       7.4       379       975       23,290     $ 23.89       4.0

2023

    20       233       4,561     $ 19.58       1.2       277       462       12,951     $ 28.03       6.0       297       695       17,512     $ 25.20       3.0

2024

    24       409       5,776     $ 14.12       1.6       241       406       11,668     $ 28.74       5.4       265       815       17,444     $ 21.40       3.0

2025

    28       419       5,456     $ 13.02       1.5       223       404       10,874     $ 26.92       5.1       251       823       16,330     $ 19.84       2.8

2026

    34       444       7,242     $ 16.31       2.0       210       390       11,035     $ 28.29       5.1       244       834       18,277     $ 21.91       3.1

2027

    34       634       9,469     $ 14.94       2.5       215       344       10,718     $ 31.16       5.0       249       978       20,187     $ 20.64       3.4

Thereafter

    1,077       24,359       314,542     $ 12.91       84.7       1,041       2,892       69,881     $ 24.16       32.5       2,118       27,251       384,423     $ 14.11       65.6
 

 

 

   

 

 

   

 

 

 

Total

    1,341       28,057     $ 371,352     $ 13.24       100.0       4,148       7,943     $ 215,074     $ 27.08       100.0       5,489       36,000     $ 586,426     $ 16.29       100.0

 

15


DDR Corp.

Developments/Redevelopments

 

$ in thousands                                                          
    DDR
Own%
    Project
Yield
    Est.
Total Net
Cost
    Cost
Incurred
To Date
    Est.
Remain
Costs
    Placed
In
Service
    CIP (1)     Initial
Occupancy
    Est.
Stabilized
Quarter
   

Key Tenants

Consolidated Summary

                   

Redevelopments – Major (2)

      8   $ 154,675     $ 67,737     $ 86,938     $ 50,691     $ 17,046        

Redevelopments – Tactical (3)

      9     41,550       28,364       13,186       10,029       18,335        

Other (4)

      N/A       N/A       20,228       0       0       20,228        

Undeveloped land (5)

      N/A       N/A       21,424       0       0       21,424        
     

 

 

       
      $ 196,225     $ 137,753     $ 100,124     $ 60,720     $ 77,033        

Redevelopments – Major

                   

Kenwood Square

(Cincinnati, OH)

    100     $ 30,928     $ 25,474     $ 5,454     $ 23,768     $ 1,706       4Q16       2Q18    

Dick’s Sporting Goods,

T.J. Maxx, Five Below,

Marshalls, Michaels

Lee Vista Promenade

(Orlando, FL)

    100       39,241       29,816       9,425       26,923       2,893       1Q18       1Q19     Academy Sports, Bealls

West Bay Plaza

(Cleveland, OH)

    100       27,792       9,208       18,584       0       9,208       4Q18       3Q19     Fresh Thyme, Kirklands, Pet Supplies Plus, Ulta, HomeSense

Kmart Shopping Center

(Tampa, FL)

    100       27,732       1,991       25,741       0       1,991       4Q19       4Q20    

Shoppers World

(Boston, MA)

    100       20,426       395       20,031       0       395       TBD       TBD    

Sandy Plains Village

(Atlanta, GA)

    100       8,556       853       7,703       0       853       TBD       TBD    
     

 

 

       
      $ 154,675     $ 67,737     $ 86,938     $ 50,691     $ 17,046        

 

(1) Balance is in addition to DDR’s pro rata share of joint venture CIP of $6 million.
(2) Projects excluded from same store NOI. Includes large-scale shopping center expansion and repurposing projects.
(3) Projects included in same store NOI. Includes outparcels, first generation space and small-scale shopping center expansions and other capital improvements.
(4) Includes predevelopment and retenanting expenditures.
(5) Balance is in addition to owned land adjacent to existing centers with an estimated value of $31 million and cost basis of the headquarters (non-income producing) of $41 million.

 

16


DDR Corp.

Transactions

 

$ and GLA in thousands                                                
                 DDR    

Total

Owned

     At 100%      At DDR Share  
     Property Name    City, State      Own%     GLA      Price      Debt      Price      Debt  
  

 

 

Dispositions

                      

01/09/18

   Indian Lakes Crossing (BRE DDR Retail Holdings III)      Virginia Beach, VA        5.0     71      $ 14,700      $ 7,178      $ 735      $ 359  

01/18/18

   Fortuna Center Plaza      Dumfries, VA        100.0     105        20,225        0        20,225        0  

02/07/18

   Meridian Crossroads      Meridian, ID        100.0     527        78,700        0        78,700        0  

02/28/18

   Lakewood Ranch Plaza (DDRM Properties)      Bradenton, FL        20.0     85        17,963        10,500        3,593        2,100  

02/28/18

   Crystal Springs (DDRM Properties)      Crystal River, FL        20.0     67        10,567        6,750        2,113        1,350  

02/28/18

   Paraiso Plaza (DDRM Properties)      Hialeah, FL        20.0     61        15,743        10,250        3,149        2,050  

02/28/18

   Plaza del Paraiso (DDRM Properties)      Miami, FL        20.0     85        21,581        13,000        4,316        2,600  

02/28/18

   Southwood Village (DDRM Properties)      Tallahassee, FL        20.0     63        9,693        6,750        1,939        1,350  

02/28/18

   Shoppes at Lithia (DDRM Properties)      Valrico, FL        20.0     71        16,614        9,500        3,323        1,900  

02/28/18

   Shoppes at Lake Dow (DDRM Properties)      McDonough, GA        20.0     73        13,874        7,200        2,775        1,440  

03/15/18

   Shoppes of Citrus Hills (DDRM Properties)      Hernando, FL        20.0     69        12,098        6,470        2,420        1,294  

03/15/18

   Bardmoor Promenade (DDRM Properties)      Largo, FL        20.0     158        31,868        19,000        6,374        3,800  

03/22/18

   Pioneer Hills      Aurora, CO        100.0     138        21,100        0        21,100        0  

03/27/18

   Naugatuck Valley SC (BRE DDR Retail Holdings III)      Waterbury, CT        5.0     383        24,500        31,491        1,225        1,575  

03/29/18

   Southern Tier Crossing      Horseheads, NY        100.0     175        18,500        0        18,500        0  
   Non-operating sales              2,100           2,100     
   Preferred equity repayment              36,072           36,072     
          

 

 

 
        1Q 2018 Total          2,131      $ 365,898      $ 128,089      $ 208,659      $ 19,818  

04/05/18

   Hobby Lobby Center (BRE DDR Retail Holdings III)      Greenville, SC        5.0     69      $ 6,000      $ 5,191      $ 300      $ 260  

04/17/18

   Silver Spring Square (RVI)      Mechanicsburg, PA        100.0     343        80,810        65,730        80,810        65,730  

04/20/18

   Sherwood Retail Center (BRE DDR Retail Holdings III)      Sherwood, AR        5.0     123        4,148        5,249        207        262  

04/20/18

   Valley Bend (BRE DDR Retail Holdings III)      Huntsville, AL        5.0     425        66,000        43,500        3,300        2,175  

04/23/18

   The Shops at Fox River      McHenry, IL        100.0     341        32,000        0        32,000        0  
          

 

 

 
       
2Q 2018 Quarter to
Date
 
 
       1,301      $ 188,958      $ 119,670      $ 116,617      $ 68,427  
          

 

 

 
        Total 2018          3,432      $ 554,856      $ 247,759      $ 325,276      $ 88,245  
          

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

17


DDR Corp.

Debt Summary

 

$ in thousands                                                
    Consolidated     Unconsolidated     Total Pro Rata  
    Total
100%
    Total
DDR Share
    GAAP
Interest Rate
DDR Share
    Total
100%
    Total
DDR Share
    GAAP
Interest Rate
DDR Share
    Total
DDR Share
    GAAP
Interest Rate
DDR Share
 
Debt Composition                      

Unsecured Credit Facilities

  $ 120,000     $ 120,000       3.08           $ 120,000       3.08

Unsecured Term Loan

    200,000       200,000       3.23             200,000       3.23

Unsecured Public Debt

    1,929,635       1,929,635       4.40             1,929,635       4.40

Fixed Rate Mortgage Loans

    185,688       175,965       4.11   $ 907,423     $ 152,870       4.37     328,835       4.23

Variable Rate Mortgage Loans

    1,350,000       1,350,000       5.36     1,458,860       182,423       3.76     1,532,423       5.17
 

 

 

 

Subtotal

  $ 3,785,323     $ 3,775,600       4.62   $ 2,366,283     $ 335,293       4.04   $ 4,110,893       4.58

Fair Market Value Adjustment

    2,292       2,292           7,630       381           2,673      

Unamortized Loan Costs, Net

    (46,095     (46,009         (15,948     (2,898         (48,907    
 

 

 

 

Total

  $ 3,741,520     $ 3,731,883       4.62   $ 2,357,965     $ 332,776       4.04   $ 4,064,659       4.58

 

    

Principal

Payments

   

Secured

Maturities

   

Unsecured

Maturities

   

Total

100%

   

Total

Pro Rata

   

Pro Rata GAAP

Interest Rate

 
  

 

 

 

Consolidated Maturity Schedule (1)

            

2018

   $ 3,351     $ 0     $ 22,231     $ 25,582     $ 25,582       7.54

2019

     2,521       94,720       0       97,241       97,241       3.57

2020

     1,750       39,934       0       41,684       41,684       5.00

2021

     1,214       14,637       0       15,851       15,851       4.12

2022

     0       27,561       570,000       597,561       587,838       4.33

2023

     0       1,350,000       287,209       1,637,209       1,637,209       5.00

2024

     0       0       65,614       65,614       65,614       4.06

2025

     0       0       457,142       457,142       457,142       3.79

2026

     0       0       400,000       400,000       400,000       4.43

2027 and beyond

     0       0       450,000       450,000       450,000       4.81

Unsecured debt discount

         (2,561     (2,561     (2,561  
  

 

 

 

Total

   $ 8,836     $ 1,526,852     $ 2,249,635     $ 3,785,323     $ 3,775,600       4.62
     Principal
Payments
    Secured
Maturities
    Unsecured
Maturities
    Total
100%
    Total
Pro Rata
    Pro Rata GAAP
Interest Rate
 

Unconsolidated Maturity Schedule (1)

            

2018

   $ 3,234     $ 100,849     $ 0     $ 104,083     $ 14,672       4.54

2019

     4,426       443,235       0       447,661       23,279       3.77

2020

     5,092       339,523       0       344,615       52,356       3.43

2021

     4,596       255,172       0       259,768       58,251       4.83

2022

     3,390       898,252       0       901,642       136,482       3.98

2023

     2,930       78,677       0       81,607       4,636       4.24

2024

     1,352       83,688       0       85,040       11,854       4.31

2025

     903       0       0       903       452       0.00

2026

     935       0       0       935       467       0.00

2027 and beyond

     1,214       138,815       0       140,029       32,844       3.67
  

 

 

 

Total

   $ 28,072     $ 2,338,211     $ 0     $ 2,366,283     $ 335,293       4.04
     Consolidated    

Wtd Avg

GAAP Rate

    Unconsolidated    

Wtd Avg

GAAP Rate

    Total    

Wtd Avg

GAAP Rate

 
  

 

 

 

% of Total (2)

            

Fixed

     55.8     4.4     45.6     4.4     54.9     4.4

Variable

     44.2     4.9     54.4     3.8     45.1     4.8

Recourse to DDR

     59.6     4.2     0.0     0.0     54.7     4.2

Non-recourse to DDR

     40.4     4.1     100.0     4.0     45.3     4.1

 

(1) Assumes borrower extension options are exercised.    
(2) Calculations based on DDR share.    

 

18


DDR Corp.

Consolidated Debt Detail

 

$ in thousands                         
     Balance
100%
    Balance
DDR Share
    Maturity
Date (1)
    GAAP Interest
Rate (2)
 

Bank Debt (3)

        

Unsecured Revolver ($950m)

   $ 120,000     $ 120,000       09/22       L + 120  

Unsecured Revolver ($50m)

     0       0       09/22       L + 120  

Unsecured Term Loan ($200m)

     200,000       200,000       01/23       L + 135  
  

 

 

     
   $ 320,000     $ 320,000      

Public Debt

        

Unsecured Notes

   $ 22,232     $ 22,232       07/18       7.54

Unsecured Notes

     453,724       453,724       07/22       4.63

Unsecured Notes

     86,937       86,937       05/23       3.52

Unsecured Notes

     65,437       65,437       08/24       4.06

Unsecured Notes

     454,830       454,830       02/25       3.79

Unsecured Notes

     397,230       397,230       02/26       4.43

Unsecured Notes

     449,245       449,245       06/27       4.81
  

 

 

     
   $ 1,929,635     $ 1,929,635      

Mortgage Debt

        

Nassau Park Pavilion, NJ

   $ 53,445     $ 53,445       02/19       3.56

Bandera Pointe, TX

     23,253       23,253       02/19       3.59

Presidential Commons, GA

     19,878       19,878       02/19       3.57

Polaris Towne Center, OH

     41,448       41,448       04/20       5.00

Chapel Hills West, CO

     10,864       10,864       06/21       3.70

Chapel Hills East, CO

     7,336       7,336       12/21       4.74

Paradise Village Gateway, AZ (DDR 67%)

     29,464       19,741       01/22       4.89

Retail Value Inc. (38 assets) (4)

     1,350,000       1,350,000       02/23       5.36
  

 

 

     
   $ 1,535,688     $ 1,525,965      

Consolidated Debt Subtotal

   $ 3,785,323     $ 3,775,600      

FMV Adjustment – Assumed Debt

     2,292       2,292      

Unamortized Loan Costs, Net

     (46,095     (46,009    
  

 

 

     

Total Consolidated Debt

   $ 3,741,520     $ 3,731,883      

Rate Type

        

Fixed

   $ 2,115,323     $ 2,105,600       6.4 years       4.37

Variable

     1,670,000       1,670,000       4.8 years       4.94
  

 

 

   

 

 

   

 

 

 
   $ 3,785,323     $ 3,775,600       5.7 years       4.62

Perpetual Preferred Stock

        

Class J

   $ 200,000     $ 200,000       August 2017  (5)      6.50

Class K

     150,000       150,000       April 2018  (5)      6.25

Class A

     175,000       175,000       June 2022  (5)      6.38

 

(1) Assumes borrower extension options are exercised.    
(2) L = LIBOR    
(3) Excludes loan fees and unamortized loan costs.    
(4) LIBOR subject to a 3.0% cap.    
(5) Earliest redemption date.    

 

19


DDR Corp.

Unconsolidated Debt Detail

 

$ in thousands                          
     Balance
100%
    Balance
DDR Share
    Maturity
Date (1)
     GAAP Interest
Rate
 

BRE DDR Retail Holdings III (DDR 5%)

         

Camp Creek, GA

   $ 42,000     $ 2,100       12/18        3.65

Powell Center, OH

     7,315       366       05/19        3.28

November 2019 Loan Pool (23 assets)

     436,065       21,803       11/19        3.78

January 2022 Loan Pool (2 assets)

     18,684       934       01/22        3.76

March 2022 Loan Pool (3 assets)

     23,400       1,170       03/22        4.14

Eastland Center, CA

     90,000       4,500       07/22        3.97

July 2022 Loan Pool (2 assets)

     4,635       232       07/22        3.74

White Oak Village, VA

     34,250       1,713       09/22        1.93

Midtowne Park, SC

     15,736       787       01/23        4.34

Valley Bend, AL

     43,500       2,175       06/23        4.22
  

 

 

      
   $ 715,585     $ 35,780       

BRE DDR Retail Holdings IV (DDR 5%)

         

Ashbridge Square, PA

   $ 35,000     $ 1,750       01/22        4.39

The Hub, NY

     29,262       1,463       01/22        4.41

Fountains of Miramar, FL

     24,093       1,205       01/22        4.32

Southmont Plaza, PA

     33,163       1,658       01/22        4.44

Millenia Crossing, FL

     21,969       1,098       01/23        4.20

Concourse Village, FL

     13,760       688       02/24        4.32
  

 

 

      
   $ 157,247     $ 7,862       

DDRM Properties (DDR 20%)

         

July 2022 Loan Pool (13 assets)

   $ 218,730     $ 43,746       07/22        4.20

July 2022 Loan Pool (21 assets)

     274,760       54,952       07/22        3.84

July 2022 Loan Pool (9 assets)

     112,275       22,455       07/22        3.92
  

 

 

      
   $ 605,765     $ 121,153       

DDRTC Core Retail Fund (DDR 15%)

         

July 2020 Loan Pool (9 assets) (2)

   $ 185,587     $ 27,838       07/20        3.33

July 2020 Loan Pool (5 assets) (2)

     153,936       23,090       07/20        3.54

November 2021 Loan Pool (7 assets)

     174,719       26,208       11/21        3.95

Birkdale Village, NC

     81,238       12,186       04/24        4.31

Overlook at King of Prussia, PA

     40,800       6,120       09/27        3.88

Marketplace at Millcreek, GA

     39,600       5,940       09/27        3.88

Winslow Bay Commons, NC

     25,800       3,870       09/27        3.89
  

 

 

      
   $ 701,680     $ 105,252       

DDR-SAU Retail Fund (DDR 20%)

         

September 2017 Loan Pool (7 assets) (3)

   $ 27,972     $ 5,595       04/18        4.75

April 2018 Loan Pool (5 assets) (3)

     30,877       6,176       04/18        4.66
  

 

 

      
   $ 58,849     $ 11,771       

Other Joint Ventures

         

Sun Center Limited, OH (DDR 79%)

   $ 20,770     $ 16,502       05/21        6.14

RVIP IIIB, Deer Park, IL (DDR 26%)

     66,887       17,223       09/21        4.91

Lennox Town Center Limited, OH (DDR 50%)

     39,500       19,750       04/28        3.49
  

 

 

      
   $ 127,157     $ 53,475       

Unconsolidated Debt Subtotal

   $ 2,366,283     $ 335,293       

FMV Adjustment – Assumed Debt

     7,630       381       

Unamortized Loan Costs, Net

     (15,948     (2,898     
  

 

 

      

Total Unconsolidated Debt

   $ 2,357,965     $ 332,776       

 

20


DDR Corp.

Unconsolidated Debt Detail

 

$ in thousands                           
    

Balance

100%

    

Balance

DDR Share

    

Maturity

Date (1)

   

GAAP Interest

Rate

 
  

 

 

 

Rate Type

          

Fixed

   $ 907,423      $ 152,870        5.1 years       4.37

Variable

     1,458,860        182,423        3.3 years       3.76
  

 

 

 
   $ 2,366,283      $ 335,293        4.1 years       4.04
    

Notional

Amount

    

Rate

Hedged

    

Fixed

Rate

   

Termination

Date

 
  

 

 

 

Interest Rate Swaps

          

Mortgage Loan Camp Creek

   $ 42,000        1 mo. LIBOR        1.87     12/18  

 

(1) Assumes borrower extension options are exercised.
(2) LIBOR subject to a 0.25% floor.
(3) Six properties were refinanced in April 2018 with gross proceeds of $41.6MM and a 04/28 maturity.

 

21


DDR Corp.

Debt/Adjusted EBITDA

 

$ in thousands             
     1Q18     1Q17  

Consolidated

    

Net loss to DDR

   ($ 54,153   ($ 54,241

Interest expense

     44,040       51,827  

Income tax expense

     (18     223  

Depreciation and amortization

     74,424       90,884  

Adjustments for non-controlling interests

     (167     (224
  

 

 

 

EBITDA – current quarter

     64,126       88,469  

Separation charges

     0       11,471  

Impairments

     30,444       21,973  

Equity in net (income) loss of JVs

     (8,786     1,665  

Reserve of preferred equity interests

     3,961       76,000  

Gain on disposition of real estate, net

     (10,011     (38,127

Other expense, net

     61,607       0  

Hurricane casualty loss

     4,533       0  

Business interruption income

     (2,000     0  

JV OFFO (at DDR Share)

     7,625       6,662  
  

 

 

 

Adjusted EBITDA – current quarter (1)

     151,499       168,113  

Adjusted EBITDA – annualized

     605,996       672,452  

Consolidated debt

     3,741,520       4,520,926  

Partner share of consolidated debt

     (9,723     (9,873

Loan costs, net

     46,095       17,368  

Face value adjustments

     (2,292     (5,465

Cash and restricted cash

     (65,132     (65,755
  

 

 

 

Net effective debt

   $ 3,710,468     $ 4,457,201  

Debt/Adjusted EBITDA – Consolidated (2)

     6.1x       6.6x  

Pro rata including JVs

    

Adjusted EBITDA – current quarter

     155,288       173,165  

Adjusted EBITDA – annualized

     621,152       692,660  

Consolidated net debt

     3,710,468       4,457,201  

JV debt (at DDR Share)

     335,293       398,078  

Cash and restricted cash

     (13,477     (12,944
  

 

 

 

Net effective debt

   $ 4,032,284     $ 4,842,335  

Debt/Adjusted EBITDA – Pro Rata (2)

     6.5x       7.0x  

 

(1) See definition in the Non-GAAP Measures section.    
(2) Excludes perpetual preferred stock.    

 

22


DDR Corp.

Unconsolidated Joint Ventures

 

$ and GLA in thousands                                              
     Partner   

DDR

Own%

   

Operating

Properties

   

Owned

GLA

    

1Q18 NOI

at 100% (1)

   

Gross

Book Value

    

Face Value

Debt (2)

    

DDR

Preferred
Equity

(At 100%)

 
  

 

 

BRE DDR Retail

Holdings III

   Blackstone Real

Estate Partners

     5     35       6,722      $ 21,822     $ 1,028,327      $ 715,585      $ 185,446 (3) 

BRE DDR Retail

Holdings IV

   Blackstone Real

Estate Partners

     5     6       1,259        4,039       206,111        157,247        51,479 (4) 

DDRM Properties

   Madison

International Realty

     20     43       6,259        15,930       1,073,191        605,765        0  

DDRTC Core

Retail Fund

   TIAA-CREF      15     23       8,069        23,691       1,512,610        701,680        0  

DDR–SAU

Retail Fund

   State of Utah      20     12       976        2,412       133,555        58,849        0  

Other

   Various      Various       6       1,666        6,498       299,963        127,157        0  
     

 

 

 

Total

          125 (5)      24,951      $ 74,392     $ 4,253,757      $ 2,366,283      $ 236,925  

Property management fees

            3,803  (1)         

Assets sold in 1Q2018

            1,949  (1)         
            

 

 

         

Net operating income

          $ 80,144  (6)         

 

(1) Property management fees charged by DDR to the joint venture are included as an expense in NOI, although presented in the combined income statement on the next page in the line item Other Expense. The NOI for BRE DDR III and DDRM is adjusted to reflect the impact of assets sold in 1Q18.
(2) Fair market value of debt adjustment and net unamortized loan costs ($0.4 million or $2.9 million at DDR’s Share) are excluded from above.
(3) Amount is net of $48.7 million valuation allowance and $84.3 million of face value repaid through March 31, 2018. Face value of $234.1 million including accrued interest of $3.9 million. The 8.5% dividend rate has two components, a cash dividend rate of 6.5% and an accrued payment in kind (“PIK”) of 2.0%. The Company no longer recognizes the accrued PIK as income due to the valuation allowance. Repayment from net asset sale proceeds are allocated 52.2% to the preferred member unless certain financial covenants have been triggered, in which event 100% to the preferred member.
(4) Amount is net of $16.3 million valuation allowance and $17.9 million of face value repaid through March 31, 2018. Face value of $67.8 million including accrued interest of $1.1 million. The 8.5% dividend rate has two components, a cash dividend rate of 6.5% and an accrued PIK of 2.0%. The Company no longer recognizes the accrued PIK as income due to the valuation allowance. Repayment from net asset sale proceeds are first subject to a minimum sales threshold of $4.9 million, of which $1.1 million is allocated to the preferred member; subsequent net asset sale proceeds are expected to be available to repay the preferred member. Included in the collateral for the preferred equity interest is 95% of the value of the six joint venture properties and 100% of the value of three properties in which the Company does not have a material interest, but to which DDR provides property asset management services.
(5) Excludes one consolidated joint venture asset in which the Company has an effective 67% interest.    
(6) Amount agrees to the combined income statement of the joint ventures which includes a reconciliation of the Non-GAAP measure to the applicable GAAP measure. See calculation definition in the Non-GAAP Measures section.

 

23


DDR Corp.

Unconsolidated Joint Ventures

 

Combined DDR JV Pro Rata Adjustments (1)

 

Income Statement Pro Rata Adjustments 1Q18

   

Balance Sheet Pro Rata Adjustments 1Q18

 

Revenues:

     Assets:   

Minimum rents

   $ 13,029     Land    $ 154,072  

Percentage rent

     48     Buildings      420,424  

Recoveries

     4,043     Improvements      35,120  
       

 

 

 

Other property revenue

     477          609,616  
  

 

 

      
     17,597     Depreciation      (165,828
       

 

 

 

Expenses:

          443,788  

Operating and maintenance

     2,545     Construction in progress and land      6,010  
       

 

 

 

Real estate taxes

     2,658     Real estate, net      449,798  
  

 

 

      
     5,203     Investment in JVs      1,106  
  

 

 

      

Net Operating Income

     12,394     Cash and restricted cash      13,444  

Other Income (expense):

     Receivables, net      6,539  

Fee income

     (794   Other assets, net      14,985  
       

 

 

 

Interest income

     (325   Total Assets    $ 485,872  

Impairment charges

     (846   Liabilities and Equity:   

Interest expense

     (3,749   Mortgage debt    $ 332,776  

Depreciation and amortization

     (5,181   Notes payable to DDR      438  

Other income (expense), net

     (495   Other liabilities      14,578  
  

 

 

      

 

 

 

Income before earnings from JVs

     1,004     Total Liabilities      347,792  

Equity in net income of JVs

     (8,786   JVs share of equity      16,593  

Basis differences of JVs

     334     Distributions in excess of net income      121,487  
       

 

 

 

Gain on disposition of real estate

     7,448     Total Equity      138,080  
  

 

 

      

 

 

 

Net income

   $ 0     Total Liabilities and Equity    $ 485,872  

FFO Reconciliation 1Q18

            

Income before earnings from JVs

   $ 1,004       

Depreciation and amortization

     5,181