Cousins Properties Incorporated 2006 Annual Report - SNL Financial

More documents

Recommendations

Info

COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS ($ in thousands) Years Ended December 31, 2006 2005 2004 CASH FLOWS FROM OPERATING ACTIVITIES: Net income . .......................................................... $ Adjustments to reconcile net income to net cash flows provided by operating activities: 232,691 $ 49,741 $ 407,784 Gain on sale of investment properties, net of income tax provision. . .................. (89,507) (16,770) (199,983) Loss on extinguishment of debt .......................................... 18,207 — — Depreciation and amortization ........................................... 43,690 36,586 42,529 Amortization of deferred financing costs . . . ................................. 1,938 1,275 1,645 Stock-based compensation expense . . ...................................... 7,044 3,132 1,714 Effect of recognizing rental revenues on a straight-line or market basis ................. (1,372) (4,220) 2,777 Income from unconsolidated joint ventures in excess of operating distributions. ........... (3,602) (6,008) — Residential lot, outparcel and multi-family cost of sales ........................... 31,566 23,794 11,393 Residential lot, outparcel and multi-family acquisition and development expenditures ....... (32,697) (16,305) (9,429) Income tax benefit from stock options ...................................... (2,643) 1,009 2,996 Minority interest in income . . ........................................... Changes in other operating assets and liabilities: 5,287 3,037 1,417 Change in other receivables . . ........................................... 11,470 (17,052) (3,257) Change in accounts payable and accrued liabilities . . ............................ 4,210 (1,143) (3,062) Net cash provided by operating activities . . . ...................................... CASH FLOWS FROM INVESTING ACTIVITIES: 226,282 57,076 256,524 Proceeds from investment property sales ...................................... 299,389 35,758 537,477 Proceeds from venture formation accounted for as a sale. ........................... 297,295 — — Property acquisition and development expenditures . . . ............................ (460,913) (256,428) (174,512) Investment in unconsolidated joint ventures . . . ................................. (23,747) (33,910) (27,754) Distributions from unconsolidated joint ventures in excess of income . .................. 87,144 29,615 43,039 Proceeds from (investment in) notes receivable . ................................. (1,283) 7,984 (8,250) Change in other assets, net ............................................... (20,866) 3,250 (3,805) Change in restricted cash ................................................ 982 (1,520) 2,473 Net cash provided by (used in) investing activities . . ................................. CASH FLOWS FROM FINANCING ACTIVITIES: 178,001 (215,251) 368,668 Repayment of credit and construction facilities . ................................. (1,396,136) (625,349) (435,150) Borrowings under credit and construction facilities . . . ............................ 1,431,001 783,384 435,150 Payment of loan issuance costs . ........................................... (2,151) (437) (2,628) Defeasance costs paid . . ................................................ (15,443) — — Repayment of other notes payable or construction loans ............................ (161,886) (24,273) (195,695) Proceeds from other notes payable or construction loans ............................ 11,481 28,920 — Common stock issued, net of expenses . ...................................... 14,664 7,547 9,120 Income tax benefit from stock options. . ...................................... 2,643 — — Common dividends paid . ................................................ (250,964) (74,649) (429,362) Preferred stock issued, net of issuance costs . . . ................................. — — 96,471 Preferred dividends paid . ................................................ (15,250) (14,604) (7,750) Contributions from minority partners . . ...................................... 1,162 — — Distributions to minority partners ........................................... (21,202) (2,518) (18,919) Net cash provided by (used in) financing activities . . ................................. (402,081) 78,021 (548,763) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ................. 2,202 (80,154) 76,429 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD ..................... 9,336 89,490 13,061 CASH AND CASH EQUIVALENTS AT END OF PERIOD .......................... $ 11,538 $ 9,336 $ 89,490 See notes to consolidated financial statements. F-6
COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. ORGANIZATION AND BASIS OF PRESENTATION Organization: Cousins Properties Incorporated (“Cousins”), a Georgia corporation, is a self-administered and self-managed real estate investment trust (“REIT”). Cousins Real Estate Corporation and its subsidiaries (“CREC”) is a taxable entity wholly-owned by and consolidated with Cousins. CREC owns, develops, and manages its own real estate portfolio and performs certain real estate related services for other parties. Description of Business: Cousins, CREC and their subsidiaries (collectively, the “Company”) actively invest in office, multi-family, retail, industrial and land development projects. As of December 31, 2006, the Company’s portfolio consisted of interests in 7.2 million square feet of office space, 4.2 million square feet of retail space, 2.0 million square feet of industrial space, a 529-unit for-sale multi-family project under development, interests in 24 residential communities under development, over 9,000 acres of strategically located land tracts held for investment or future development, and significant land holdings for development of single-family residential communities. The Company also provides leasing and management services to third-party investors; its clientservices portfolio comprises 14.8 million square feet of office and retail space. Basis of Presentation: The Consolidated Financial Statements include the accounts of Cousins, its consolidated partnerships and wholly owned subsidiaries and CREC and its consolidated subsidiaries. The Company evaluates all partnership interests or other variable interests to determine if the venture is a variable interest entity (“VIE”), as defined in Financial Accounting Standards Board (“FASB”) Interpretation No. 46R. If a venture is a VIE and the Company is determined to be the primary beneficiary, the Company consolidates the assets, liabilities and results of operations of the VIE. In December 2006, the Company formed a joint venture with Callaway Gardens Resorts, Inc. for the development of residential lots within the Callaway Gardens Resort. The joint venture is considered a VIE, and the Company was determined to be the primary beneficiary. As of December 31, 2006, the VIE has total assets of $1.6 million, which are consolidated in the Consolidated Balance Sheet at December 31, 2006. Additionally, the Company holds a 50% ownership interest in Charlotte Gateway Village, LLC (“Gateway”), a VIE which owns and operates an office building complex in Charlotte, North Carolina. The Company determined it is not the primary beneficiary. The Company’s investment in Gateway was $10.5 million at December 31, 2006, which is its maximum exposure. See Note 6 for further discussion of Gateway. For entities that are not considered VIEs, the Company uses Statement of Financial Accounting Standards (“SFAS”) No. 94, “Consolidation of All Majority-Owned Subsidiaries,” Accounting Research Bulletin (“ARB”) No. 51, “Consolidated Financial Statements,” and Emerging Issues Task Force (“EITF”) No. 04-5, “Determining Whether a General Partner, or the General Partners as a Group, Controls a Limited Partnership or Similar Entity When the Limited Partners Have Certain Rights” to determine the appropriate consolidation and presentation. A description of the Company’s investments accounted for under the equity method is included in Note 6. The Company recognizes Minority Interest on its Consolidated Balance Sheets for non-wholly owned entities that the Company consolidates. The minority partner’s share of current operations is reflected in Minority Interest in Income of Consolidated Subsidiaries on the Consolidated Statements of Income. 2. SIGNIFICANT ACCOUNTING POLICIES Long-Lived Assets Cost Capitalization: Costs related to planning, developing, leasing and constructing a property are capitalized and classified with Properties in the Consolidated Balance Sheets, in accordance with SFAS No. 67, “Accounting for Costs and Initial Rental Operations of Real Estate Projects.” Costs for development personnel who work directly on projects under construction are capitalized during the construction period. An estimate of time is obtained directly from such personnel and the Company applies a percentage of their actual salaries plus an estimate F-7
Page 1 and 2:
Outstanding Performance Cousins Pro
Page 3 and 4:
FORWARD-LOOKING STATEMENTS Certain
Page 5 and 6:
Had significant leasing activity, n
Page 7 and 8:
Certain environmental laws impose l
Page 9 and 10:
Environmental issues. Environmental
Page 11 and 12:
Financing Risks If interest rates o
Page 13 and 14:
eceive less cash than the amount of
Page 15 and 16:
income, Cousins is subject to tax o
Page 17 and 18:
16 Description and Location Year De
Page 19 and 20: 18 Lease Expirations — Office As
Page 21 and 22: 20 Description and Location Year De
Page 23 and 24: Lease Expirations — Industrial As
Page 25 and 26: Additional Information Related to O
Page 27 and 28: (3) Total Project GLA includes anch
Page 29 and 30: Description Year Commenced Estimate
Page 31 and 32: Description and Location(1) Zoned U
Page 33 and 34: Mr. DuPree rejoined the Company in
Page 35 and 36: Performance Graph The following gra
Page 37 and 38: General and Administrative Expenses
Page 39 and 40: For the foreseeable future, the Com
Page 41 and 42: collectibility of unit purchase pri
Page 43 and 44: Decrease of approximately $1.2 mill
Page 45 and 46: The vesting period for stock option
Page 47 and 48: esidential lot development and land
Page 49 and 50: Stock-Based Compensation. The Compa
Page 51 and 52: capitalization at December 31, 2006
Page 53 and 54: Cash Flows from Investing Activitie
Page 55 and 56: eceivable. The table presents sched
Page 57 and 58: Item 9. Changes in and Disagreement
Page 59 and 60: We have also audited, in accordance
Page 61 and 62: 10(a)(v)* Form of Restricted Stock
Page 63 and 64: SIGNATURES Pursuant to the requirem
Page 65 and 66: Cousins Properties Incorporated IND
Page 67 and 68: COUSINS PROPERTIES INCORPORATED AND
Page 69: COUSINS PROPERTIES INCORPORATED AND
Page 73 and 74: fair values at the date of acquisit
Page 75 and 76: Income Taxes COUSINS PROPERTIES INC
Page 77 and 78: outstanding. The income amounts use
Page 89 and 90: Company and 28% to GDL, after each
Page 99 and 100: The following supplemental pro form
Page 107 and 108: 14. PROFIT SHARING/401(K) PLAN The
Page 109 and 110: S-2 Description Encumbrances COUSIN
Page 111 and 112: S-4 Description Encumbrances COUSIN
Page 113 and 114: COUSINS PROPERTIES INCORPORATED STA
Page 115 and 116: Subsidiary State of Incorporation C
Page 117 and 118: I, Thomas D. Bell, Jr., certify tha
Page 119 and 120: Exhibit 32.1 CERTIFICATION PURSUANT
Page 121 and 122:
Shareholder Information INDEPENDENT
show all

Cousins Properties Incorporated 2006 Annual Report - SNL Financial

Create successful ePaper yourself

Delete template?

Save as template?