Wed, 16 Jun 2021

SAN DIEGO, CA / ACCESSWIRE / May 11, 2021 / Presidio Property Trust, Inc. (NASDAQ:SQFT) (the 'Company'), an internally‑managed, diversified REIT, with holdings in office, industrial, retail, and model home properties, today reported financial results for its first quarter ended March 31, 2021. All first quarter financial measures referenced herein are unaudited.

'We are pleased to report our first quarter earnings, continuing the strong rent collections that we saw throughout 2020,' said Jack Heilbron, the Company's President and Chief Executive Officer. 'The diversified nature of our portfolio, with especially strong office and model home collections, resulted in a company-wide collections rate of 96% of budget in the first quarter of 2021.'

'Fifteen office leases were inked in the first quarter of 2021, with 5 new tenants and 10 existing tenant renewals,' noted Gary Katz, the Company's Senior Vice President of Asset Management. 'As many local COVID-related restrictions have been relaxed, we believe that the optimism of an economic recovery will translate into more tenant renewals, and prospective tenants signing new leases.'

First Quarter Highlights

First Quarter Ended March 31, 2021 Financial Results

Net loss attributable to the Company's common stockholders for the three months ended March 31, 2021 was approximately $2.7 million, or $0.28 per basic and diluted share, compared to a net loss of $1.1 million, or $0.12 per basic and diluted share for the three months ended March 31, 2020. The increase in net loss attributable to the Company's common stockholders was a result of:

FFO (non-GAAP) for the first quarter ended March 31, 2021 increased by approximately $156,000 to $935,725 from $779,689 for the three months ended March 31, 2020. A reconciliation of FFO to net loss, the most directly comparable GAAP financial measure, is attached to this press release. However, because FFO excludes depreciation and amortization as well as the changes in the value of the Company's properties that result from use or market conditions, each of which have real economic effects and could materially impact the Company's results from operations, the utility of FFO as a measure of the Company's performance is limited.

First Quarter Ended March 31, 2021 Acquisitions and Dispositions

During the three months ended March 31, 2021, the Company did not acquire any properties or model homes.

Dividends
On February 23, 2021, the board of directors of the Company declared a quarterly dividend of $0.101 per share of [Class A] common stock for the first quarter of 2021, payable on March 16, 2021 to stockholders of record as of March 9, 2021.

About Presidio Property Trust, Inc.
The Company is an internally managed, diversified REIT, with holdings in model home properties which are triple-net leased to homebuilders, office, industrial, and retail properties. In October 2017, we changed our name from 'NetREIT, Inc.' to 'Presidio Property Trust, Inc.' The Company acquires, owns and manages a geographically diversified portfolio of real estate assets including office, industrial, retail and model home residential properties leased to homebuilders located throughout the United States. As of March 31, 2021, the Company owned or had an equity interest in:

The Company's model homes are leased on a triple-net basis to homebuilders located primarily in Texas and Florida. Our office, industrial and retail properties are located primarily in Colorado, with four properties located in North Dakota and two in Southern California. While geographical clustering of real estate enables us to reduce our operating costs through economies of scale by servicing a number of properties with less staff, it makes us susceptible to changing market conditions in these discrete geographic areas, including those that have developed as a result of COVID-19. We do not develop properties but acquire properties that are stabilized or that we anticipate will be stabilized within two or three years of acquisition. We consider a property to be stabilized once it has achieved an 80% occupancy rate for a full year as of January 1 of such year or has been operating for three years.

Most of our office and retail properties are leased to a variety of tenants ranging from small businesses to large public companies, many of which are not investment grade. We have in the past entered into, and intend in the future to enter into, purchase agreements for real estate having net leases that require the tenant to pay all of the operating expense (NNN leases) and/or pay increases in operating expenses over specific base years. Most of our office leases are for terms of 3 to 5 years with annual rental increases. Our model homes are typically leased back for 2 to 3 years to the home builder on a triple net lease. Under a triple net lease, the tenant is required to pay all operating, maintenance and insurance costs and real estate taxes with respect to the leased property.

We seek to diversify our portfolio by commercial real estate segments to reduce the adverse effect of a single under-performing segment, geographic market and/or tenant. We further supplement this at the tenant level through our credit review process, which varies by tenant class. For example, our commercial and industrial tenants tend to be corporations or individual owned businesses. In these cases, we typically obtain financial records, including financial statements and tax returns (depending on the circumstance), and run credit reports for any prospective tenant to support our decision to enter into a rental arrangement. We also typically obtain security deposits from these commercial tenants. Our model home commercial tenants are generally reputable homebuilders with established credit histories. These tenants are subjected to financial review and analysis prior to us entering into a sales-leaseback transaction. For more information on Presidio, please visit the Company website at http://www.presidiopt.com.

Definitions

Non-GAAP Financial Measures

Funds from Operations ('FFO') - The Company evaluates performance based on Funds From Operations, which we refer to as FFO, as management believes that FFO represents the most accurate measure of activity and is the basis for distributions paid to equity holders. The Company defines FFO as net income or loss (computed in accordance with GAAP), excluding gains (or losses) from sales of property, hedge ineffectiveness, acquisition costs of newly acquired properties that are not capitalized and lease acquisition costs that are not capitalized plus depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges on properties or investments in non-consolidated REITs, and after adjustments to exclude equity in income or losses from, and, to include the proportionate share of FFO from, non-consolidated REITs.

However, because FFO excludes depreciation and amortization as well as the changes in the value of the Company's properties that result from use or market conditions, each of which have real economic effects and could materially impact the Company's results from operations, the utility of FFO as a measure of the Company's performance is limited. In addition, other REITs may not calculate FFO in accordance with the NAREIT definition as the Company does, and, accordingly, the Company's FFO may not be comparable to other REITs' FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of the Company's performance.

Core Funds from Operations ('Core FFO') - We calculate Core FFO by using FFO as defined by NAREIT and adjusting for certain other non-core items. We also exclude from our Core FFO calculation acquisition costs, loss on early extinguishment of debt, changes in the fair value of the earn-out, changes in fair value of contingent consideration and the amortization of stock-based compensation.

We believe Core FFO provides a useful metric in comparing operations between reporting periods and in assessing the sustainability of our ongoing operating performance. Other equity REITs may calculate Core FFO differently or not at all, and, accordingly, the Company's Core FFO may not be comparable to such other REITs' Core FFO.

Same Store Net Operating Income ('Same Store NOI') - Same Store NOI is calculated as the net operating income attributable to the properties continuously owned and operated for the entirety of the reporting periods presented. The Company's definition of Same Store NOI excludes properties that were not stabilized during both of the applicable reporting periods. These exclusions may include, but are not limited to, acquisitions, dispositions and properties undergoing repositioning or significant renovations.

We believe Same Store NOI is an important measure of comparison because it allows for comparison of operating results of stabilized properties owned and operated for the entirety of both applicable periods and therefore eliminates variations caused by acquisitions, dispositions or repositioning during such periods. Other REITs may calculate Same Store NOI differently and our calculation should not be compared to that of other REITs.

Safe Harbor Disclosure
This press release contains statements that are 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and other federal securities laws. Forward-looking statements are statements that are not historical, including statements regarding management's intentions, beliefs, expectations, representations, plans or predictions of the future, and are typically identified by such words as 'believe,' 'expect,' 'anticipate,' 'intend,' 'estimate,' 'may,' 'will,' 'should' and 'could.' Because such statements include risks, uncertainties and contingencies, actual results may differ materially from those expressed or implied by such forward-looking statements. These forward-looking statements are based upon the Company's present expectations, but these statements are not guaranteed to occur. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward-looking statements. For further discussion of the factors that could affect outcomes, please refer to the 'Risk Factors' section of the Company's Annual Report on Form 10-K filed with the SEC on March 30, 2021 and the Company's Quarterly Report on Form 10-Q filed with the SEC on the date hereof, and in the Company's other documents filed with the SEC, copies of which are available on the SEC's website, www.sec.gov.

Contact Information
Presidio Property Trust, Inc.

Lowell Hartkorn, Investor Relations
+1-760-471-8536 x 1244
lhartkorn@presidiopt.com

Presidio Property Trust, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets

Presidio Property Trust, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)

Presidio Property Trust, Inc. and Subsidiaries
Reconciliation of Net Income to FFO and Core FFO
(Unaudited)

Presidio Property Trust, Inc. and Subsidiaries
Same Store Net Operating Income - Commercial Properties
(Unaudited)

SOURCE: Presidio Property Trust



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https://www.accesswire.com/646318/Presidio-Property-Trust-Inc-Announces-Earnings-for-the-First-Quarter-Ended-March-31-2021

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