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02/26/2018

iStar Announces Fourth Quarter and Fiscal Year 2017 Results

NEW YORK, Feb. 26, 2018 /PRNewswire/ -- iStar (NYSE: STAR) today reported results for the quarter and fiscal year ended December 31, 2017. The Company has also published a supplemental to this earnings release which is available at www.istar.com in the "Investors" section.

"2017 was a strong year for iStar. Our accomplishments include successfully delivering significant earnings, executing $2 billion of transformative capital markets transactions that resulted in upgrades by all three credit rating agencies and launching a new publicly traded company focused on reinventing the ground lease business," said Jay Sugarman, iStar's Chairman and Chief Executive Officer. "Our focus now is growing our investment pace and our share price and we have taken several steps to accelerate our momentum in 2018."

  • Net income (loss) for fiscal year and fourth quarter 2017 was $110.9 million, or $1.56 per diluted common share and $(4.9) million, or $(0.07) per diluted common share, respectively.
                            
  • Adjusted income for fiscal year and fourth quarter 2017 was $214.6 million, or $2.57 per diluted common share, and $31.5 million, or $0.40 per diluted common share, respectively.
                                  
  • Hired new Chief Investment Officer, Marcos Alvarado, former Head of Acquisitions & Business Operations at Cadre and former Managing Director at Starwood Capital.
                                  
  • Increased new loan originations to $457 million during the quarter.
                                 
  • Realized $360 million of proceeds from legacy assets in 2017, goal to outpace this amount in 2018.
                                       
  • Working with J.P. Morgan Securities LLC to review strategic options for longer-term legacy asset portfolio.

Fourth Quarter 2017 Results

iStar reported net income (loss) allocable to common shareholders for the fourth quarter of $(4.9) million, or $(0.07) per diluted common share, versus $(19.3) million, or $(0.27) per diluted common share for the fourth quarter 2016.

Adjusted income allocable to common shareholders for the fourth quarter was $31.5 million, or $0.40 per diluted common share, versus $2.7 million, or $0.04 per diluted common share for the fourth quarter 2016.

Adjusted income represents net income computed in accordance with GAAP, prior to the effects of certain non-cash items. The calculation of adjusted income and reconciliation to GAAP net income are presented in the financial tables that follow the text of this press release.

Fiscal Year 2017 Results

For the full year 2017, net income allocable to common shareholders was $110.9 million, or $1.56 per diluted common share, versus $44.0 million, or $0.60 per diluted common share for the full year 2016.

Adjusted income allocable to common shareholders for the full year was $214.6 million, or $2.57 per diluted common share, versus $112.6 million, or $1.15 per diluted common share for the prior year.

New Accounting Standards Impact on 2018 Results

On January 1, 2018, new accounting standards related to partial sales of non-financial assets became effective. The Company will adopt this standard using the modified retrospective approach, in which it will record a cumulative adjustment to equity on January 1, 2018 in lieu of recasting prior financial periods. Specifically, the Company expects to record an incremental gain to beginning balance of GAAP book equity of approximately $76 million, or approximately $1.10 per basic common share, in the first quarter. The adjustment relates to previously unrecognized gains from prior asset sales, including the sale of the Company's ground lease assets to Safety, Income & Growth in 2017. The Company will reflect these cumulative gains in its adjusted income metrics for the first quarter of 2018.

Executive Team Update

iStar announced that it has hired Marcos Alvarado as its Chief Investment Officer and a member of its senior executive team. Mr. Alvarado has closed more than $25 billion of investments across all parts of the capital structure and will leverage his extensive experience to help the Company identify opportunities and grow its core businesses. Mr. Alvarado was previously Head of Acquisitions & Business Operations for Cadre and a Managing Director at Starwood Capital.

"Marcos brings top tier real estate investment experience to our company and offers a unique perspective for iStar's creative strategies," said Sugarman. "In the short time he's been with the team, he has already made important contributions to our unique platform. In addition, I am happy to announce that we have appointed Nina Matis as Vice Chairman in addition to her responsibilities as Chief Legal Officer."

Portfolio Overview and Investment Activity

At December 31, 2017, the Company's portfolio totaled $4.9 billion, which is gross of $356 million of accumulated depreciation and $18 million of general loan loss reserves and includes $120 million market value of SAFE shares as of December 31, 2017 versus carrying value of $84 million.

iStar's portfolio includes its core businesses of real estate finance, net lease, and SAFE as well as non-core businesses of operating properties and land & development.

(1) Represents market value of investment in SAFE as of December 31, 2017.

During the fourth quarter of 2017, the Company invested a total of $504 million in new investments, prior financing commitments and ongoing development across its four segments, and generated $335 million of proceeds from repayments and sales.

Real Estate Finance

iStar's real estate finance business targets sophisticated and innovative investors by providing one-stop capabilities that encompass financial alternatives ranging from full envelope senior loans to custom-tailored mezzanine and preferred equity capital positions.

At December 31, 2017, the Company's real estate finance portfolio totaled $1.3 billion. The portfolio is categorized into iStar 3.0 loans, made post January 1, 2008, and legacy loans, which were all made prior to December 31, 2007.

During the quarter, the Company closed on $457 million of loan originations and funded $405 million associated with these deals and prior financing commitments.

Real Estate Finance Statistics

     

$ in millions

 

iStar 3.0

 

Legacy Loans

Gross book value

$

1,121

 

$

197

% of total loan portfolio

85%

 

15%

       

Performing loans

$

1,121

 

$

20

Non-performing loans

$

 

$

177

% Performing / Non-performing

 

100% / 0%

   

10% / 90%

       

First mortgages / senior loans

71%

 

27%

Mezzanine / subordinated debt

29%

 

73%

Total

100%

 

100%

       

Wtd. avg. LTV (1)

67.5%

 

n/a

Unlevered yield (1)

10.2%

 

n/a

Wtd. avg. maturity (years) (1)

2.0

 

n/a

Note: Gross book value represents the carrying value of iStar's loans, gross of general reserves.

 

(1) Includes performing loans only.

Net Lease

iStar's net lease business seeks to create stable cash flows through long-term leases to single tenants on its properties. The Company targets mission-critical facilities leased on a long-term basis to tenants, offering structured solutions that combine iStar's capabilities in underwriting, lease structuring, asset management, and build-to-suit construction.

At the end of the quarter, the book value of iStar's net lease portfolio totaled $1.3 billion, gross of $292 million of accumulated depreciation. The portfolio was comprised of $1.1 billion of wholly-owned assets, a $121 million equity investment in its net lease joint venture and $120 million market value in shares of SAFE.

Since 2014, the Company has invested in new net lease investments primarily through its net lease joint venture with a sovereign wealth fund, in which it holds a 52% interest. At the end of the quarter, the venture's balance sheet, gross of $48 million of accumulated depreciation, included $691 million of assets, $406 million of liabilities and $224 million of equity (net of a $13 million non-controlling interest). The investment period for the fund expires on March 31, 2018.

During the quarter, the Company sold an office property with a remaining lease term approaching five years in Sunnyvale, CA for $100 million and generated a $62.5 million gain. In addition, the Company recorded a $5.3 million impairment on one net lease asset based on a change in business plan.

Safety, Income & Growth Inc. (NYSE: SAFE)

iStar is the founder, largest shareholder and manager of Safety, Income & Growth Inc. (NYSE: SAFE), the first and only publicly traded company to focus on ground leases.  Ground leases provide a unique mix of principal safety, growing dividends and the potential for significant capital appreciation.  iStar held 6.8 million shares, or 37.6% of the shares outstanding, at the end of the year. During the fourth quarter, the Company purchased 0.5 million shares of SAFE for $9.6 million. Subsequent to the end of the year, iStar purchased an additional 0.4 million shares for $7.6 million, bringing its ownership up to 39.9% of shares outstanding.

SAFE is seeking to reinvent how ground leases are utilized in the $7 trillion institutional commercial real estate market. These efforts are beginning to gain traction, as SAFE has recently closed on two transactions that demonstrate how SAFE Ground LeasesTM can be a better way for real estate investors, developers and acquirers to capitalize their projects. As of its most recent report, SAFE's pipeline stood at nearly $1 billion, including $72 million of deals under LOI.

Operating Properties

At the end of the quarter, iStar's operating property portfolio totaled $629 million, gross of $55 million of accumulated depreciation, and was comprised of $580 million of commercial and $49 million of residential real estate properties.

The Company's commercial operating properties represent a diverse pool of assets across a broad range of geographies and collateral types including office, entertainment and hotel properties. These properties generated $25.4 million of revenue offset by $21.1 million of operating expenses during the quarter.

Land & Development

At the end of the quarter, the Company's land & development portfolio totaled $933 million, including 8 master planned communities, 6 waterfront projects and 14 urban/infill developments. These projects are collectively entitled for approximately 12,500 lots and units.

For the quarter, the Company's land and development portfolio generated $18.2 million of revenues, offset by $15.0 million of cost of sales. In addition, the Company recorded a loss of $1.1 million from land development equity method investments.  During the quarter, the Company invested $40.3 million in its land portfolio.

During the quarter, the Company recorded a $10.5 million impairment associated with its Coney Island amphitheater. The impairment is related to the slower than expected ramp up of revenues at the amphitheater and restaurant.

Capital Markets and Balance Sheet

As previously reported, iStar executed a comprehensive series of capital markets transactions during the third quarter of 2017 which enhanced the Company's overall financial position, extended its debt maturity profile, lowered its cost of capital and resulted in upgrades from all three credit rating agencies. Near the end of the third quarter, the Company issued three series of notes totaling $1.09 billion. Proceeds from the issuances, together with cash on hand, were used to repay $1.15 billion of notes and $240 million of preferred stock at the beginning of the fourth quarter. As a result, the Company recorded a $9.0 million one-time prepayment penalty on the early redemption of these notes in the quarter.

Subsequent to the end of the year, the Company purchased approximately 0.7 million shares of STAR under its 10b5-1 share repurchase program for $7.1 million. Following these purchases, the Company had $42.9 million remaining under its share repurchase authorization.

Capital Structure

 

$ in millions

 

At December 31, 2017

Secured debt

$924

Unsecured debt

2,552

Total debt

$3,476

   

Preferred equity (A) (1)

$505

Common equity (B)

375

Total equity

$880

   

Accumulated depreciation and amortization
and general loan loss reserves (C) (2)

$435

   

Adjusted common equity (B) + (C)

$810

Adjusted total equity (A) + (B) + (C)

$1,315

   

(1) Represents aggregate liquidation preference.
(2) Accumulated depreciation and amortization includes iStar's proportionate share of
accumulated depreciation and amortization relating to equity method investments.

The Company seeks to match funds its balance sheet to help insulate from the impact of rising interest rates. At the end of the year, the Company had $789 million of floating rate loans and $499 million of floating rate debt, net of repaying its revolving credit facility. As a result, a 25 basis point increase in LIBOR would result in an approximately $1 million increase to full year net income.

Leverage

The Company's weighted average cost of debt for the fourth quarter was 5.1%. The Company's leverage was 2.1x on an actual basis at the end of the quarter, on the low end of the Company's targeted range of 2.0x - 2.5x.  The chart below shows the calculation of the Company's leverage.

Leverage

 

$ in millions

 

At December 31, 2017

Total debt

$3,476

Less: Cash and cash equivalents

658

Net book debt (A)

$2,818

   

Total equity (1)

$880

Add: Accumulated depreciation and
amortization (2)

417

Add: General loan loss reserves

18

Sum of total equity, accumulated D&A and
general loan loss reserves (B)

$1,315

   

Leverage (A) / (B)

2.1x

   
   

(1) Includes aggregate liquidation preference of preferred equity.
(2) Accumulated depreciation and amortization includes iStar's proportionate share
of accumulated depreciation and amortization relating to equity method
investments.

Liquidity

The Company continues to maintain a healthy liquidity position. Unrestricted cash at the end of the quarter was $658 million, which is available for new investment activity and working capital.

Liquidity

 

$ in millions

 

At December 31, 2017

Unrestricted cash

$658

Revolving credit facility capacity

Total liquidity

$658

   

Corporate Initiatives

Since 2012, the Company has generated $2.5 billion of proceeds from the sale of legacy assets and recorded net gains of approximately $700 million. Today, the non-core, legacy portfolio, comprised of primarily land & development, operating properties and NPLs, has been reduced to $1.7 billion.

For 2018, the Company is targeting to generate over $400 million of proceeds from legacy asset monetizations.

In addition, the Company is working with J.P. Morgan Securities LLC to explore alternatives for the balance of the legacy asset portfolio. Alternatives may include accelerated sales of individual assets or groups of assets, and structural alternatives such as a spinoff and/or joint venture. As part of this review, the Company is also looking at opportunities to reduce its G&A. There can be no assurance that the Company's review of alternatives for the legacy portfolio will result in any transaction.

*     *     *

iStar (NYSE: STAR) finances, invests in and develops real estate and real estate related projects as part of its fully-integrated investment platform. Building on over two decades of experience and more than $35 billion of transactions, iStar brings uncommon capabilities and new ways of thinking to commercial real estate and adapts its investment strategy to changing market conditions. The Company is structured as a real estate investment trust ("REIT"), with a diversified portfolio focused on larger assets located in major metropolitan markets.

iStar logo. (PRNewsFoto/iStar Financial Inc.)

iStar will hold a quarterly earnings conference call at 10:00 a.m. ET today, February 26, 2018. This conference call will be broadcast live on iStar's website, www.istar.com. To listen to the live call, please go to the website's "Investors" section at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those who are not available to listen to the live broadcast, a replay will be available shortly after the call on iStar's website.

Note: Statements in this press release which are not historical fact may be deemed 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. Although iStar believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained. The Company undertakes no obligation to update or revise publicly any forward look statements, whether as a result of new information, future events or otherwise. Factors that could cause actual results to differ materially from iStar's expectations include general economic conditions and conditions in the commercial real estate and credit markets, the Company's ability to generate liquidity and to repay indebtedness as it comes due, additional loan loss provisions, the amount and timing of asset sales, changes in NPLs, repayment levels, the Company's ability to make new investments, the Company's ability to maintain compliance with its debt covenants, the Company's ability to generate income and gains from operating properties and land and other risks detailed from time to time in iStar SEC reports.

 

iStar

Consolidated Statements of Operations

(In thousands)

(unaudited)

 
   

Three Months
Ended December 31,

 

For the Twelve Months
Ended December 31,

   

2017

 

2016

 

2017

 

2016

REVENUES

               

Operating lease income

 

$

45,529

   

$

43,909

   

$

187,684

   

$

191,180

 

Interest income

 

23,403

   

29,276

   

106,548

   

129,153

 

Other income

 

16,055

   

11,435

   

188,091

   

46,514

 

Land development revenue

 

18,157

   

13,951

   

196,879

   

88,340

 

  Total revenues

 

$

103,144

   

$

98,571

   

$

679,202

   

$

455,187

 

COST AND EXPENSES

               

Interest expense

 

$

46,002

   

$

53,225

   

$

194,686

   

$

221,398

 

Real estate expense

 

41,064

   

32,707

   

147,617

   

137,522

 

Land development cost of sales

 

15,028

   

11,166

   

180,916

   

62,007

 

Depreciation and amortization

 

11,736

   

11,878

   

49,033

   

51,660

 

General and administrative(1)

 

25,534

   

21,594

   

98,882

   

84,027

 

(Recovery of) provision for loan losses

 

2,300

   

235

   

(5,828)

   

(12,514)

 

Impairment of assets

 

17,088

   

2,731

   

32,379

   

14,484

 

Other expense

 

105

   

1,142

   

20,954

   

5,883

 

  Total costs and expenses

 

$

158,857

   

$

134,678

   

$

718,639

   

$

564,467

 

  Income (loss) before other items

 

$

(55,713)

   

$

(36,107)

   

$

(39,437)

   

$

(109,280)

 

Income from discontinued operations

 

   

7,336

   

4,939

   

18,270

 

Gain from discontinued operations

 

   

   

123,418

   

 

Income from sales of real estate

 

63,782

   

16,910

   

92,049

   

105,296

 

Earnings from equity method investments

 

(662)

   

3,095

   

13,015

   

77,349

 

Income tax benefit

 

6,465

   

306

   

948

   

10,166

 

Loss on early extinguishment of debt

 

(10,582)

   

(1)

   

(14,724)

   

(1,619)

 

  Net income (loss)

 

$

3,290

   

$

(8,461)

   

$

180,208

   

$

100,182

 

Net (income) loss attributable to noncontrolling interests

(76)

   

2,039

   

(4,526)

   

(4,876)

 

  Net income (loss) attributable to iStar

 

$

3,214

   

$

(6,422)

   

$

175,682

   

$

95,306

 

Preferred dividends

 

(8,124)

   

(12,830)

   

(64,758)

   

(51,320)

 

Net (income) loss allocable to Participating Security holders(2)

   

   

   

(14)

 

Net income (loss) allocable to common shareholders

 

$

(4,910)

   

$

(19,252)

   

$

110,924

   

$

43,972

 

______________________________________________________

(1) For the three months ended December 31, 2017 and 2016, includes $6,081 and $3,245 of stock-based compensation expense, respectively. For the twelve months ended December 31, 2017 and 2016, includes $18,812 and $10,889 of stock-based compensation expense, respectively. 

(2) Participating Security holders are non-employee directors who hold common stock equivalents and restricted stock awards granted under the Company's LTIP who are eligible to participate in dividends.

 

 

iStar

Supplemental Information

(In thousands, except per share data)

(unaudited)

 
 

Three Months
Ended December 31,

 

For the Twelve Months
Ended December 31,

 

2017

 

2016

 

2017

 

2016

ADJUSTED INCOME

             

Reconciliation of Net Income to Adjusted Income

             

Net income (loss) allocable to common shareholders

$

(4,910)

   

$

(19,252)

   

$

110,924

   

$

43,972

 

Add: Depreciation and amortization (1)

15,390

   

14,341

   

60,828

   

64,447

 

Add: (Recovery of) provision for loan losses

2,300

   

235

   

(5,828)

   

(12,514)

 

Add: Impairment of assets (2)

17,088

   

6,331

   

32,379

   

18,999

 

Add: Stock-based compensation expense

6,081

   

3,245

   

18,812

   

10,889

 

Add: Loss on early extinguishment of debt

1,673

   

1

   

3,065

   

1,619

 

Add: Non-cash interest expense of discount on senior convertible notes

1,145

   

   

1,255

   

 

Add: Premium on redemption of preferred stock

   

   

16,314

   

 

Less: Losses on charge-offs and dispositions (3)

(7,224)

   

(2,225)

   

(23,130)

   

(14,827)

 

Less: Participating Security allocation

   

   

   

(23)

 

Adjusted income allocable to common shareholders

$

31,543

   

$

2,676

   

$

214,619

   

$

112,562

 

______________________________________________________

Note: In addition to net income (loss) prepared in conformity with GAAP, the Company uses adjusted income, a non-GAAP financial measure, to measure its operating performance. Adjusted income is used internally as a supplemental performance measure adjusting for certain non-cash GAAP measures to give management a view of income more directly derived from current period activity. Adjusted income is calculated as net income (loss) allocable to common shareholders, prior to the effect of depreciation and amortization, provision for (recovery of) loan losses, impairment of assets, stock-based compensation expense, the non-cash portion of gain (loss) on early extinguishment of debt and is adjusted for the effect of gains or losses on charge-offs and dispositions on carrying value gross of loan loss reserves and impairments ("Adjusted Income"). In the third quarter 2017, the Company modified its presentation of Adjusted Income to exclude the effect of the amount of the liquidation preference that was recorded as a premium above book value on the redemption of preferred stock and the imputed non-cash interest expense recognized for the conversion feature of its senior convertible notes. Adjusted Income should be examined in conjunction with net income (loss) as shown in our consolidated statements of operations. Adjusted Income should not be considered as an alternative to net income (loss) (determined in accordance with GAAP), or to cash flows from operating activities (determined in accordance with GAAP), as a measure of our liquidity, nor is Adjusted Income indicative of funds available to fund our cash needs or available for distribution to shareholders. Rather, Adjusted Income is an additional measure we use to analyze our business performance because it excludes the effects of certain non-cash charges that we believe are not necessarily indicative of our operating performance while including the effect of gains or losses on investments when realized. It should be noted that our manner of calculating Adjusted Income may differ from the calculations of similarly-titled measures by other companies.

(1) Depreciation and amortization includes our proportionate share of depreciation and amortization expense relating to equity method investments and excludes the portion on depreciation and amortization expense allocable to non-controlling interests.

(2) Impairment of assets includes impairments on equity method investments recorded in earnings from equity method investments.

(3) Losses on charge-offs and dispositions represents the impact of charge-offs and dispositions realized during the period. These charge-offs and dispositions were on assets that were previously impaired for GAAP and reflected in net income but not in Adjusted Income.

 

 

iStar

Earnings Per Share Information

(In thousands, except per share data)

(unaudited)

 
   

Three Months
Ended December 31,

 

For the Twelve Months
Ended December 31,

   

2017

 

2016

 

2017

 

2016

EPS INFORMATION FOR COMMON SHARES

               

Income (loss) from continuing operations attributable to iStar(1)

       

Basic

 

$

(0.07)

   

$

(0.37)

   

$

(0.25)

   

$

0.35

 

Diluted

 

$

(0.07)

   

$

(0.37)

   

$

(0.25)

   

$

0.35

 

Net income (loss)

               

Basic

 

$

(0.07)

   

$

(0.27)

   

$

1.56

   

$

0.60

 

Diluted

 

$

(0.07)

   

$

(0.27)

   

$

1.56

   

$

0.60

 

Adjusted income

               

Basic

 

$

0.46

   

$

0.04

   

$

3.02

   

$

1.53

 

Diluted

 

$

0.40

   

$

0.04

   

$

2.57

   

$

1.15

 

Weighted average shares outstanding

               

Basic

 

68,200

   

71,603

   

71,021

   

73,453

 

Diluted (for net income per share)

 

68,200

   

71,603

   

71,021

   

73,835

 

Diluted (for adjusted income per share)

 

84,090

   

72,038

   

87,028

   

114,102

 

Common shares outstanding at end of period

 

68,236

   

72,042

   

68,236

   

72,042

 

_____________________________________________________

(1) Including preferred dividends, net (income) loss attributable to noncontrolling interests and income from sales of real estate.

 

 

iStar

Consolidated Balance Sheets

(In thousands)

(unaudited)

 
 

As of

 

As of

 

December 31, 2017

 

December 31, 2016

ASSETS

     
       

Real estate

     

Real estate, at cost

$

1,629,436

   

$

1,740,893

 

Less: accumulated depreciation

(347,405)

   

(353,619)

 

Real estate, net

$

1,282,031

   

$

1,387,274

 

Real estate available and held for sale

68,588

   

237,531

 
 

$

1,350,619

   

$

1,624,805

 

Land and development, net

860,311

   

945,565

 

Loans receivable and other lending investments, net

1,300,655

   

1,450,439

 

Other investments

321,241

   

214,406

 

Cash and cash equivalents

657,688

   

328,744

 

Accrued interest and operating lease income receivable, net

11,957

   

11,254

 

Deferred operating lease income receivable

86,877

   

88,189

 

Deferred expenses and other assets, net

141,730

   

162,112

 

Total assets

$

4,731,078

   

$

4,825,514

 
       

LIABILITIES AND EQUITY

     
       

Accounts payable, accrued expenses and other liabilities

$

238,004

   

$

211,570

 

Loan participations payable, net

102,425

   

159,321

 

Debt obligations, net

3,476,400

   

3,389,908

 

Total liabilities

$

3,816,829

   

$

3,760,799

 
       

Redeemable noncontrolling interests

$

   

$

5,031

 
       

Total iStar shareholders' equity

$

879,703

   

$

1,016,564

 

Noncontrolling interests

34,546

   

43,120

 

Total equity

$

914,249

   

$

1,059,684

 
       

Total liabilities and equity

$

4,731,078

   

$

4,825,514

 

 

 

iStar

Segment Analysis

(In thousands)

(unaudited)

 

FOR THE THREE MONTHS ENDED DECEMBER 31, 2017

           
 

Real
Estate
Finance

 

Net
Lease

 

Operating
Properties

 

Land &
Dev

 

Corporate
/ Other

 

Total

Operating lease income

$

   

$

30,078

   

$

15,183

   

$

268

   

$

   

$

45,529

 

Interest income

23,403

   

   

   

   

   

23,403

 

Other income

779

   

595

   

11,922

   

829

   

1,930

   

16,055

 

Land development revenue

   

   

   

18,157

   

   

18,157

 

Earnings (loss) from equity method investments

   

1,723

   

(1,474)

   

(1,105)

   

194

   

(662)

 

Income from sales of real estate

   

62,535

   

1,247

   

   

   

63,782

 

Total revenue and other earnings

$

24,182

   

$

94,931

   

$

26,878

   

$

18,149

   

$

2,124

   

$

166,264

 

Real estate expense

   

(3,679)

   

(22,368)

   

(15,017)

   

   

(41,064)

 

Land development cost of sales

   

   

   

(15,028)

   

   

(15,028)

 

Other expense

(149)

   

   

   

   

44

   

(105)

 

Allocated interest expense

(8,798)

   

(12,051)

   

(4,699)

   

(6,264)

   

(14,190)

   

(46,002)

 

Allocated G&A(1)

(3,602)

   

(4,685)

   

(2,090)

   

(3,847)

   

(5,229)

   

(19,453)

 

Segment profit (loss)

$

11,633

   

$

74,516

   

$

(2,279)

   

$

(22,007)

   

$

(17,251)

   

$

44,612

 

____________________________________________________________________________

(1) Excludes $6.1 million of stock-based compensation expense.

 

AS OF DECEMBER 31, 2017

                     
 

Real
Estate
Finance

 

Net
Lease

 

Operating
Properties

 

Land &
Dev

 

Corporate
/ Other

 

Total

Real estate

                     

Real estate, at cost

$

   

$

1,108,051

   

$

521,385

   

$

   

$

   

$

1,629,436

 

Less: accumulated depreciation

   

(292,268)

   

(55,137)

   

   

   

(347,405)

 

Real estate, net

$

   

$

815,783

   

$

466,248

   

$

   

$

   

$

1,282,031

 

Real estate available and held for sale

   

   

68,588

   

   

   

68,588

 

Total real estate

$

   

$

815,783

   

$

534,836

   

$

   

$

   

$

1,350,619

 

Land & development, net

   

   

   

860,311

   

   

860,311

 

Loans receivable and other lending investments, net

1,300,655

   

   

   

   

   

1,300,655

 

Other investments

   

205,007

   

38,761

   

63,855

   

13,618

   

321,241

 

Total portfolio assets

$

1,300,655

   

$

1,020,790

   

$

573,597

   

$

924,166

   

$

13,618

   

$

3,832,826

 

Cash and other assets

                   

898,252

 

  Total assets

                   

$

4,731,078

 

 

 

iStar

Supplemental Information

(In thousands)

(unaudited)

 
       

Three Months Ended
December 31, 2017

OPERATING STATISTICS

         
           

Expense Ratio

       

General and administrative expenses - trailing twelve months (A)

   

$

98,882

Average total assets (B)

     

$

5,112,216

Expense Ratio (A) / (B)

     

1.9%

           
         

UNFUNDED COMMITMENTS

         
           

Performance-based commitments(1)

     

$

377,809

Strategic investments

     

10,743

Total Unfunded Commitments

     

$

388,552

           

LOAN RECEIVABLE CREDIT STATISTICS

As of

 

December 31, 2017

 

December 31, 2016

           

Carrying value of NPLs /

         

As a percentage of total carrying value of loans

$

176,888

 

14.6%

 

$

191,696

 

14.0%

           

Total reserve for loan losses /

         

As a percentage of total gross carrying value of loans(2)

$

78,489

 

6.1%

 

$

85,545

 

5.9%

___________________________________________________________

(1) Excludes $102.1 million of commitments on loan participations sold that are not the obligation of the Company but are consolidated on the Company's balance sheet.

(2) Gross carrying value represents iStar's carrying value of loans, gross of loan loss reserves.

 

 

iStar

Supplemental Information

(In millions)

(unaudited)

 

PORTFOLIO STATISTICS AS OF DECEMBER 31, 2017(1)

                         

Property Type

 

Real
Estate
Finance

 

Net
Lease

 

Operating
Properties

 

Land &
Dev

 

Total

 

% of
Total

Land & Development

 

$

   

$

   

$

   

$

933

   

$

933

   

22%

Office / Industrial

 

49

   

673

   

128

   

   

850

   

20%

Mixed Use / Collateral

 

307

   

   

197

   

   

504

   

12%

Entertainment / Leisure

 

   

489

   

   

   

489

   

12%

Condominium

 

422

   

   

49

   

   

471

   

11%

Hotel

 

292

   

   

104

   

   

396

   

9%

Other Property Types

 

223

   

   

12

   

   

235

   

6%

Retail

 

25

   

57

   

139

   

   

221

   

5%

Ground Leases

 

   

129

   

   

   

129

   

3%

Strategic Investments

 

   

   

   

   

14

   

—%

Total

 

$

1,318

   

$

1,349

   

$

629

   

$

933

   

$

4,242

   

100%

                         

Geography

 

Real
Estate
Finance

 

Net
Lease

 

Operating
Properties

 

Land &
Dev

 

Total

 

% of
Total

Northeast

 

$

798

   

$

414

   

$

48

   

$

269

   

$

1,529

   

36%

West

 

38

   

286

   

66

   

367

   

757

   

18%

Southeast

 

181

   

254

   

141

   

114

   

690

   

16%

Southwest

 

94

   

163

   

256

   

22

   

535

   

13%

Central

 

182

   

80

   

82

   

32

   

376

   

9%

Mid-Atlantic

 

   

150

   

36

   

129

   

314

   

7%

Various

 

25

   

2

   

   

   

27

   

1%

Strategic Investments

 

   

   

   

   

14

   

—%

Total

 

$

1,318

   

$

1,349

   

$

629

   

$

933

   

$

4,242

   

100%

______________________________________________________________________

(1) Based on carrying value of the Company's total investment portfolio, gross of accumulated depreciation, general loan loss reserves and market value of its investment in shares of SAFE stock.

 

 

Cision View original content with multimedia:http://www.prnewswire.com/news-releases/istar-announces-fourth-quarter-and-fiscal-year-2017-results-300603966.html

SOURCE iStar

Company Contact: Jason Fooks, Vice President of Investor Relations & Marketing, 1114 Avenue of the Americas, New York, NY 10036, (212) 930-9400, investors@istar.com