Skip to content
Open Search Panel
Toggle Menu
<< Back to News
11/02/2017

iStar Announces Third Quarter 2017 Results

Earnings Report

Earnings Supplemental

NEW YORK, Nov. 2, 2017 /PRNewswire/ -- iStar (NYSE: STAR) today reported results for the quarter ended September 30, 2017. The Company has also published a supplemental to this earnings release which is available at www.istar.com in the "Investors" section.

Highlights

  • Net income (loss) and adjusted income (loss) for the third quarter were $(0.48) and $(0.05), respectively, per diluted common share.
  • Executed a comprehensive series of capital market transactions totaling $2.0 billion.
  • Upgraded by all three major rating agencies.
  • Updated full-year earnings guidance.

Third Quarter 2017 Results

iStar reported net income (loss) allocable to common shareholders for the third quarter of $(34.5) million, or $(0.48) per diluted common share, versus $46.3 million, or $0.44 per diluted common share for the third quarter 2016.

Adjusted income (loss) allocable to common shareholders for the third quarter was $(3.6) million, or $(0.05) per diluted common share, versus $49.1 million, or $0.47 per diluted common share for the third 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.

Year-to-Date 2017 Results

For the nine months ended September 30, 2017, net income allocable to common shareholders was $115.8 million, or $1.61 per diluted common share, which compares favorably to $63.2 million, or $0.66 per diluted common share for the same period in 2016.

Adjusted income was $183.1 million, or $2.16 per diluted common share for the nine months ended September 30, 2017, growing from $109.9 million, or $1.06 per diluted common share for the same period in 2016.

Rating Agency Upgrades

During the quarter, all three major rating agencies upgraded iStar's corporate credit rating and the majority of its outstanding preferred and debt securities. This marks the first upgrade of iStar's corporate rating from S&P in over six years and the first upgrade in corporate rating from Moody's in nearly five years.

    S&P


   Moody's


  Fitch


Current

Prior

(3/8/11)



Current

Prior

(10/4/12)



Current

Prior

(6/15/17)

Corporate

BB-

B+


Corporate

B1

B2


Corporate

BB-

B+

Unsecured

BB-

B+


Unsecured

B1

B2


Unsecured

BB

BB

Secured

BB-

B+


Secured

Ba2

Ba3


Secured

BB+

BB+

Preferred

B-

CCC+


Preferred

B3

Caa1


Preferred

B-

CCC+

 

"We were very pleased to see the rating agencies recognize the significant progress iStar has made in improving our overall credit profile by strengthening liquidity, de-levering our balance sheet, extending our maturity profile and monetizing our legacy assets," said Jay Sugarman, iStar's Chairman and Chief Executive Officer. "The improved ratings will reduce our marginal cost of capital and should allow us to be more competitive in pursuing a wider set of investment opportunities."

Capital Markets and Balance Sheet

As previously reported, iStar executed a comprehensive series of capital markets transactions during the third quarter which enhanced the Company's overall financial position.

Specifically, the transactions:

  • Catalyzed upgrades by rating agencies
  • Addressed all corporate debt maturities until July 2019
  • Extended iStar's weighted average debt maturity profile by 1.5 years to 4.0 years
  • Reduced annual expenses by approximately $37 million, or $0.43 per diluted common share
  • Lowered cost of capital by approximately 35 basis points
  • Established new banking relationships
  • Increased iStar's strong liquidity to pursue new investment opportunities

During the quarter, the Company:

  • Repriced, extended, and downsized its $473 million L+375 secured term loan due July 2020 to a $400 million L+300 secured term loan due October 2021.
  • Issued $400 million of 4.625% unsecured senior notes due September 2020 and $400 million of 5.25% unsecured senior notes due September 2022
  • Issued $250 million of 3.125% convertible notes due September 2022. Subsequent to the end of the quarter, the underwriters exercised their overallotment option to purchase an additional $37.5 million of convertible notes bringing the entire series up to $287.5 million. The notes are convertible at the option of the holders at a conversion price of approximately $15.54 per share, subject to adjustment.
  • Repurchased 4.0 million shares of its common stock for $46 million, or $11.51 per share.
  • Upsized and extended its revolving credit facility to $325 million from $250 million, including an additional commitment of $50 million from Barclays and a new $25 million commitment from Morgan Stanley.

Subsequent to the end of the quarter, utilizing these proceeds as well as cash on hand, the Company:

  • Redeemed the $550 million outstanding of its 4.0% unsecured senior notes due November 2017 at par.
  • Redeemed the $300 million outstanding of its 7.125% unsecured senior notes due February 2018 at par plus a make-whole payment.
  • Redeemed the $300 million outstanding of its 4.875% unsecured senior notes due July 2018 at par plus a make-whole payment.
  • Redeemed the $140 million outstanding of its 7.875% series E preferred stock at par.
  • Redeemed the $100 million outstanding of its 7.8% series F preferred stock at par.

The Company will record approximately $25 million of charges for the full year 2017 in connection with the foregoing transactions. This includes $16 million of deemed preferred dividends in the third quarter, representing the amount of liquidation preference that was recorded as a premium above book value on the redemption of preferred stock. In addition, the Company expects to record $9 million of make-whole payments on the early redemption of unsecured senior notes in the fourth quarter.

Capital structure, leverage, liquidity and other balance sheet metrics in this supplemental are presented as of September 30, 2017 on an actual basis and pro forma for the effects of the capital markets transactions that occurred subsequent to quarter end. Specifically, this activity includes (i) the net use of $1.4 billion of cash for the redemption of $1.15 billion of unsecured senior notes and payment of associated interest expense and make-whole amounts; and, the redemption of $240 million of preferred stock and payment of associated dividends and (ii) the issuance of $37.5 million of additional convertible notes pursuant to the exercise of the underwriters' overallotment option.

Capital Structure


$ in millions


At September 30, 2017


Pro Forma

Secured debt

$615


$615

Unsecured debt

3,664


2,550

Total debt

$4,279


$3,165





Preferred equity (A) (1) (2)

$505


$505

Common equity (B)

383


373

Total equity

$888


$878





Accumulated depreciation and amortization
and general loan loss reserves (C) (3)

$446


$446





Adjusted common equity (B) + (C)

$829


$819

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

$1,334


$1,324





(1) Represents aggregate liquidation preference.
(2) $240 million of called preferred stock was transferred to accounts payable as of September 30 and is not shown.
(3) Accumulated depreciation and amortization includes iStar's proportionate share of accumulated depreciation and
amortization relating to equity method investments.

 

Leverage

The Company's weighted average cost of debt for the third quarter was 5.3%. The Company's leverage was 1.8x on an actual basis at the end of the quarter and 2.0x on a pro forma basis, which are at 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 September 30, 2017


Adjustment


Pro Forma

Total debt

$4,279


($1,114)


$3,165

Less: Cash and cash equivalents

(1,912)


1,381


(531)

Net book debt (A)

$2,367


$267


$2,634







Total equity (1)

$888


($10)


$878

Add: Accumulated depreciation and
amortization (2)

431


-


431

Add: General loan loss reserves

15


-


15

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

$1,334


($10)


$1,324







Leverage (A) / (B)

1.8x


0.2x


2.0x













(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 and capacity on its revolving credit facility pro forma for the redemption of unsecured notes and preferred stock subsequent to the end of the quarter was $856 million, which is available for new investment activity and working capital.

Liquidity


$ in millions


At September 30, 2017


Pro Forma

Unrestricted cash

$1,912


$531

Revolving credit facility capacity

325


325

Total liquidity

$2,237


$856











 

Portfolio Overview and Investment Activity

At September 30, 2017, the Company's portfolio totaled $4.6 billion, which is gross of $371 million of accumulated depreciation and $15 million of general loan loss reserves and includes $117 million market value of SAFE shares as of September 30, 2017.

iStar's strategy is to focus on finding investment opportunities within its real estate finance, net lease, and ground lease businesses. In addition, the Company continues to make progress in harvesting value and monetizing its operating properties and land & development assets.

(1) Represents market value of investment in SAFE as of September 30, 2017. (2) Pro forma for the activity subsequent to the end of the quarter.

During the third quarter of 2017, the Company invested a total of $140 million associated with new investments (including in additional shares of common stock of SAFE), prior financing commitments and ongoing development across its four segments, and generated $247 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 September 30, 2017, the Company's real estate finance portfolio totaled $1.1 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.

Real Estate Finance Statistics




$ in millions


iStar 3.0


Legacy Loans

Gross book value

$

927


$

198

% of total loan portfolio

82%


18%





Performing loans

$

927


$

21

Non-performing loans

$


$

177

% Performing / Non-performing

100% / 0%


11% / 89%





First mortgages / senior loans

63%


27%

Mezzanine / subordinated debt

37%


73%

Total

100%


100%





Wtd. avg. LTV (1)

65%


n/a

Unlevered yield (1)

10.2%


8.9%

Wtd. avg. maturity (years) (1)

2.0


2.5

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, iStar's net lease portfolio totaled $1.4 billion, gross of $306 million of accumulated depreciation. The portfolio was comprised of $1.2 billion of wholly-owned assets, a $110 million equity investment in its net lease joint venture and $117 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 $43 million of accumulated depreciation, included $663 million of assets, $385 million of liabilities and $212 million of equity (net of a $23 million non-controlling interest).

The Company entered into an agreement to extend its largest net lease asset with a gross book value of $222 million through 2032, adding 8 years of duration. During the quarter, the Company received net proceeds of $42  million related to net lease asset sales and recognized $18.8 million of gains. The Company seeks to continue to grow its net lease portfolio, but will selectively sell net lease assets opportunistically.

Operating Properties

At the end of the quarter, iStar's operating property portfolio totaled $624 million, gross of $57 million of accumulated depreciation, and was comprised of $558 million of commercial and $66 million of residential real estate properties.

Commercial Operating Properties

The Company's commercial operating properties represent a diverse pool of assets across a broad range of geographies and collateral types including office, retail and hotel properties. These properties generated $29.6 million of revenue offset by $21.6 million of operating expenses during the quarter.

iStar generally seeks to reposition transitional assets with the objective of maximizing their values through the infusion of capital and intensive asset management efforts. The Company made additional progress towards that objective during the third quarter, as it transitioned $57 million of transitional assets into stabilized, bringing the stabilized balance to $401 million at the end of the third quarter. Transitional assets decreased to $157 million.

Residential Operating Properties

At the end of the quarter, the $66 million residential operating portfolio was comprised of 32 units generally located within luxury projects in major U.S. cities. The Company sold 4 units during the quarter, generating $3.9 million of proceeds and a $0.5 million gain.

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 15 urban/infill developments. These projects are collectively entitled for approximately 13,000 lots and units.

For the quarter, the Company's land and development portfolio generated $26.0 million of revenues, offset by $27.5 million of cost of sales. In addition, the Company earned $0.9 million of earnings from land development equity method investments.  During the quarter, the Company invested $34.5 million in its land portfolio.

Safety, Income & Growth Inc. (SAFE)

Safety, Income & Growth Inc. is the first and only publicly traded REIT to focus on ground leases. iStar is the largest shareholder and manager of SAFE with approximately 6.3 million shares, or 34.6% of the shares outstanding. During the quarter, the Company purchased 1.3 million shares of SAFE common stock for $24.5 million.

During the quarter, iStar and SAFE jointly provided capital in the form of a leasehold financing and ground lease origination on LifeHope Medical Campus in Alpharetta, GA. iStar provided a $24.0 million leasehold mortgage while SAFE simultaneously closed on a $16.0 million ground lease. All joint transactions must be approved by the independent members of iStar and SAFE's Boards of Directors.

Earnings Guidance

Earnings Guidance




$ per share


Net Income


Adjusted Income

Prior full year 2017 guidance

$2.15 - $2.65


$3.00 - $3.50

Updated full year 2017 guidance

$1.21 - $1.71


$2.25 - $2.75

Additional SAFE gain

$0.64


$0.64

Full year 2017 guidance

(under new accounting standards)

$1.85 - $2.35


$2.89 - $3.39








 

Guidance Updates

The $2.0 billion of comprehensive capital market transactions described in this release will result in a one-time pre-payment penalty of approximately $9 million, or $0.10 per diluted common share, in the fourth quarter and $16 million, or $0.19 per diluted common share, of premium over book value on the redemption of preferred stock in the third quarter. Going forward, the transaction is expected to decrease expenses underlying earnings by $0.43 per diluted common share.

Asset sales are a material part of the Company's business and have material impact to earnings and earnings guidance. Several asset sales, representing approximately $0.65 per diluted common share of forecasted 2017 income, are now expected to occur in 2018.

In addition, the Company will be required under GAAP to recognize an additional $55 million, or $0.64 per diluted common share, gain associated with the second quarter sale of its ground lease business to SAFE. This gain will not initially appear in the Company's 2017 financial results, but will be retrospectively recognized in the Company's 2017 financial results once new accounting standards become effective on January 1, 2018.

This guidance assumes, among other things, the closing of certain property sales and that general macro economic conditions continue to remain favorable. Please see the financial tables that follow the text of this press release for a reconciliation from GAAP net income guidance to adjusted income guidance.

                     

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, November 2, 2017. 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 September 30,


For the Nine Months
Ended September 30,



2017


2016


2017


2016

REVENUES









Operating lease income


$

47,806



$

46,800



$

142,155



$

147,270


Interest income


25,442



32,258



83,145



99,877


Other income


20,662



13,442



172,037



35,079


Land development revenue


25,962



31,554



178,722



74,389


   Total revenues


$

119,872



$

124,054



$

576,059



$

356,615


COST AND EXPENSES









Interest expense


$

48,732



$

55,105



$

148,684



$

168,173


Real estate expense


36,280



35,243



106,554



104,815


Land development cost of sales


27,512



22,004



165,888



50,842


Depreciation and amortization


11,846



12,201



37,297



39,781


General and administrative(1)


20,955



19,666



73,347



62,433


(Recovery of) provision for loan losses


(2,600)



(14,955)



(8,128)



(12,749)


Impairment of assets


595



8,741



15,292



11,753


Other expense


2,704



819



20,849



4,741


   Total costs and expenses


$

146,024



$

138,824



$

559,783



$

429,789


   Income (loss) before other items


$

(26,152)



$

(14,770)



$

16,276



$

(73,174)


Income from discontinued operations




3,721



4,939



10,934


Gain from discontinued operations






123,418




Income tax expense from discontinued
operations






(4,545)




Income from sales of real estate


19,313



34,444



28,267



88,387


Earnings from equity method investments


2,461



26,540



13,677



74,254


Income tax benefit (expense)


1,278



8,256



(972)



9,859


Loss on early extinguishment of debt


(616)



(36)



(4,142)



(1,618)


   Net income (loss)


$

(3,716)



$

58,155



$

176,918



$

108,642


Net (income) loss attributable to noncontrolling
interests

160



967



(4,450)



(6,915)


   Net income (loss) attributable to iStar


$

(3,556)



$

59,122



$

172,468



$

101,727


Preferred dividends


(30,974)



(12,830)



(56,634)



(38,490)


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







(27)


   Net income (loss) allocable to common
   shareholders


$

(34,530)



$

46,292



$

115,834



$

63,210


_______________________________________________________________________________


(1) For the three months ended September 30, 2017 and 2016, includes $2,934 and $1,434 of stock-based compensation expense, respectively. For the nine months ended September 30, 2017 and 2016, includes $12,730 and $7,644 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 September 30,


For the Nine Months
Ended September 30,


2017


2016


2017


2016

ADJUSTED INCOME








Reconciliation of Net Income to Adjusted Income








Net income (loss) allocable to common shareholders

$

(34,530)



$

46,292



$

115,834



$

63,210


Add: Depreciation and amortization (1)

14,765



15,598



45,438



50,107


Add: (Recovery of) provision for loan losses

(2,600)



(14,955)



(8,128)



(12,749)


Add: Impairment of assets (2)

595



8,741



15,292



12,668


Add: Stock-based compensation expense

2,934



1,434



12,730



7,644


Add: Loss on early extinguishment of debt

616



36



1,392



1,618


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

110





110




Add: Premium on redemption of preferred stock

16,314





16,314




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

(1,779)



(8,039)



(15,906)



(12,602)


Less: Participating Security allocation







(21)


Adjusted income allocable to common shareholders

$

(3,575)



$

49,107



$

183,076



$

109,875


_______________________________________________________________________________

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 cost and equity method investments recorded in other income and earnings from equity method investments, respectively.

(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 September 30,


For the Nine Months
Ended September 30,



2017


2016


2017


2016

EPS INFORMATION FOR COMMON SHARES









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





Basic


$

(0.48)



$

0.60



$

(0.11)



$

0.70


Diluted


$

(0.48)



$

0.41



$

(0.11)



$

0.57


Net income (loss)









Basic


$

(0.48)



$

0.65



$

1.61



$

0.85


Diluted


$

(0.48)



$

0.44



$

1.61



$

0.66


Adjusted income









Basic


$

(0.05)



$

0.69



$

2.54



$

1.48


Diluted


$

(0.05)



$

0.47



$

2.16



$

1.06


Weighted average shares outstanding









Basic


71,713



71,210



71,972



74,074


Diluted (for net income per share)


71,713



115,666



71,972



118,590


Diluted (for adjusted income per share)


71,713



115,666



88,020



118,590


Common shares outstanding at end of period


68,200



71,176



68,200



71,176


_______________________________________________________________________________

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

 

 

Reconciliation of Adjusted Income per Share Guidance

to Net Income per Share Guidance



For the Year Ending


December 31, 2017

Targeted Net Income per Diluted Common Share Range

$1.21 - $1.71



Add: Depreciation and amortization

$0.67 - $0.71

Add: Other non-cash adjustments

$0.73 - $0.77

Less: Losses on charge-offs and dispositions

($0.36) - ($0.44)



Targeted Adjusted Income per Diluted Common Share Range

$2.25 - $2.75

 

 

iStar

Consolidated Balance Sheets

(In thousands)

(unaudited)






As of


As of


September 30, 2017


December 31, 2016

ASSETS








Real estate




Real estate, at cost

$

1,687,318



$

1,740,893


Less: accumulated depreciation

(363,456)



(353,619)


Real estate, net

$

1,323,862



$

1,387,274


Real estate available and held for sale

65,658



237,531



$

1,389,520



$

1,624,805


Land and development, net

861,507



945,565


Loans receivable and other lending investments, net

1,109,442



1,450,439


Other investments

289,037



214,406


Cash and cash equivalents

1,912,448



328,744


Accrued interest and operating lease income receivable, net

10,849



11,254


Deferred operating lease income receivable

87,696



88,189


Deferred expenses and other assets, net

134,720



162,112


Total assets

$

5,795,219



$

4,825,514






LIABILITIES AND EQUITY








Accounts payable, accrued expenses and other liabilities

$

466,374



$

211,570


Loan participations payable, net

122,489



159,321


Debt obligations, net

4,278,954



3,389,908


Total liabilities

$

4,867,817



$

3,760,799






Redeemable noncontrolling interests

$

3,513



$

5,031






Total iStar shareholders' equity

$

888,089



$

1,016,564


Noncontrolling interests

35,800



43,120


Total equity

$

923,889



$

1,059,684






Total liabilities and equity

$

5,795,219



$

4,825,514


 

 

iStar

Segment Analysis

(In thousands)

(unaudited)


FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2017


Real
Estate
Finance


Net
Lease


Operating
Properties


Land &
Dev


Corporate
/ Other



Total

Operating lease income

$



$

31,503



$

16,048



$

255



$



$

47,806


Interest income

25,442











25,442


Other income

1,298



953



14,097



1,174



3,140



20,662


Land development revenue







25,962





25,962


Earnings from equity method investments



1,302



(399)



948



610



2,461


Income from sales of real estate



18,765



548







19,313


Total revenue and other
earnings

$

26,740



$

52,523



$

30,294



$

28,339



$

3,750



$

141,646


Real estate expense



(4,423)



(23,185)



(8,672)





(36,280)


Land development cost of sales







(27,512)





(27,512)


Other expense

(261)









(2,443)



(2,704)


Allocated interest expense

(9,165)



(12,255)



(4,860)



(6,529)



(15,923)



(48,732)


Allocated G&A(1)

(3,334)



(4,315)



(1,866)



(3,706)



(4,800)



(18,021)


Segment profit (loss)

$

13,980



$

31,530



$

383



$

(18,080)



$

(19,416)



$

8,397


_______________________________________________________________________________

(1) Excludes $2,934 of stock-based compensation expense.













AS OF SEPTEMBER 30, 2017













Real
Estate
Finance


Net
Lease


Operating Properties


Land &
Dev


Corporate / Other



Total

Real estate












Real estate, at cost

$



$

1,150,676



$

536,642



$



$



$

1,687,318


Less: accumulated
depreciation



(306,183)



(57,273)







(363,456)


Real estate, net

$



$

844,493



$

479,369



$



$



$

1,323,862


Real estate available
and held for sale





65,658







65,658


Total real estate

$



$

844,493



$

545,027



$



$



$

1,389,520


Land & development, net







861,507





861,507


Loans receivable and other
lending investments, net

1,109,442











1,109,442


Other investments



185,176



21,828



63,308



18,725



289,037


Total portfolio assets

$

1,109,442



$

1,029,669



$

566,855



$

924,815



$

18,725



$

3,649,506


Cash and other assets











2,145,713


Total assets











$

5,795,219


 

 

iStar

Supplemental Information

(In thousands)

(unaudited)










Three Months Ended
September 30, 2017

OPERATING STATISTICS












Expense Ratio





General and administrative expenses - trailing twelve months (A)



$

94,940


Average total assets (B)




$

5,213,604


Expense Ratio (A) / (B)




1.8

%











As of





September 30, 2017

UNENCUMBERED ASSETS / UNSECURED DEBT












Unencumbered assets (C)(1)




$

4,753,893


Unsecured debt (D)




$

3,720,000


Unencumbered Assets / Unsecured Debt (C) / (D)





1.3x






UNFUNDED COMMITMENTS












Performance-based commitments(2)




$

374,160


Strategic investments




45,642


Total Unfunded Commitments




$

419,802








LOAN RECEIVABLE CREDIT STATISTICS

As of


September 30, 2017


December 31, 2016







Carrying value of NPLs /






As a percentage of total carrying value of loans

$

177,166


17.3

%


$

191,696


14.0

%







Total reserve for loan losses /






As a percentage of total gross carrying value of loans(3)

$

76,189


6.9

%


$

85,545


5.9

%

_______________________________________________________________________________

(1) Unencumbered assets are calculated in accordance with the indentures governing the Company's unsecured debt securities.

(2) Excludes $115.3 million of commitments on loan participations sold that are not the obligation of the Company but are consolidated on the Company's balance sheet.

(3) 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 SEPTEMBER 30, 2017(1)














Property Type


Real
Estate
Finance


Net Lease


Operating
Properties


Land &
Dev


Total


% of
Total

Land & Development


$



$



$



$

933



$

933



23

%

Office / Industrial


46



719



123





888



22

%

Entertainment / Leisure




484







484



12

%

Mixed Use / Collateral


260





186





446



11

%

Hotel


333





103





436



11

%

Condominium


264





66





330



8

%

Other Property Types


196





9





205



5

%

Retail


26



57



137





220



5

%

Ground Leases




117







117



3

%

Strategic Investments










19



%

Total


$

1,125



$

1,378



$

624



$

933



$

4,078



100

%














Geography


Real
Estate
Finance


Net Lease


Operating
Properties


Land &
Dev


Total


% of
Total

Northeast


$

503



$

401



$

47



$

261



$

1,212



30

%

West


64



296



52



368



780



19

%

Southeast


180



252



149



121



702



17

%

Southwest


80



161



245



22



508



12

%

Central


204



79



76



32



391



10

%

Mid-Atlantic




153



45



129



327



8

%

Various


94



34



10





138



4

%

Strategic Investments










19



%

Total


$

1,125



$

1,378



$

624



$

933



$

4,078



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.

 

 

View original content with multimedia:http://www.prnewswire.com/news-releases/istar-announces-third-quarter-2017-results-300548347.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

<< Back to News