Arbor Realty Trust Reports Fourth Quarter and Full Year 2012 Results and Declares Fourth Quarter 2012 Dividend
Arbor Realty Trust Reports Fourth Quarter and Full Year 2012 Results and
Declares Fourth Quarter 2012 Dividend
Fourth Quarter Highlights:
* Declares a common dividend of $0.12 per share
* FFO of $0.9 million, or $0.03 per diluted common share^1
* Net loss attributable to Arbor Realty Trust, Inc. of $0.3 million, or
$0.01 per diluted common share
* Raised $19.2 million of capital issuing 3.5 million common shares
* Originated 10 new loans totaling $90.8 million
* Purchased five residential mortgage-backed securities totaling $40.0
million
* Adjusted book value per share $10.41, GAAP book value per share $7.34^1
* Recorded $2.5 million in loan loss reserves
Subsequent Highlights:
* Closed a $260.0 million collateralized loan obligation in January
* Raised $37.3 million of capital in a preferred stock offering in February
* Improved funding sources by closing a $50.0 million warehouse facility in
February and increasing the capacity of two financing facilities by a
total of $30.0 million in January
Full Year Highlights:
* Reinstated quarterly cash dividend, declaring $0.405 per share of common
stock related to the full year 2012
* FFO of $23.5 million, or $0.87 per diluted common share^1
* Net income attributable to Arbor Realty Trust, Inc. of $21.5 million, or
$0.79 per diluted common share
* Closed a $125.1 million collateralized loan obligation and a $15.0 million
revolving line of credit
* Raised $36.7 million of capital issuing 7.0 million common shares in two
offerings
* Originated $274.5 million of new loans and generated $85.3 million in cash
from runoff
* Purchased $157.7 million in residential mortgage-backed securities
* Generated gains of $30.5 million from the retirement of CDO debt and $4.0
million from the sale of real estate held-for-sale
* Recorded $23.8 million in loan loss reserves
* Recorded $0.9 million in cash recoveries of previously recorded reserves
UNIONDALE, N.Y., Feb. 15, 2013 (GLOBE NEWSWIRE) -- Arbor Realty Trust, Inc.
(NYSE:ABR), a real estate investment trust focused on the business of
investing in real estate related bridge and mezzanine loans, preferred and
direct equity investments, mortgage-related securities and other real estate
related assets, today announced financial results for the fourth quarter and
year ended December 31, 2012. Arbor reported a net loss attributable to Arbor
Realty Trust, Inc. for the quarter of $0.3 million, or $0.01 per diluted
common share, compared to a net loss attributable to Arbor Realty Trust, Inc.
for the quarter ended December 31, 2011 of $27.8 million, or $1.15 per diluted
common share. Net income attributable to Arbor Realty Trust, Inc. for the year
ended December 31, 2012 was $21.5 million, or $0.79 per diluted common share,
compared to a net loss attributable to Arbor Realty Trust, Inc. for the year
ended December 31, 2011 of $40.3 million, or $1.61 per diluted common share.
Funds from operations ("FFO") for the quarter ended December 31, 2012 was $0.9
million, or $0.03 per diluted common share, compared to a loss of $24.9
million, or $1.03 per diluted common share for the quarter ended December 31,
2011. FFO for the year ended December 31, 2012 was $23.5 million, or $0.87 per
diluted common share, compared to a loss of $32.6 million, or $1.30 per
diluted common share for the year ended December 31, 2011.^1
The balance of the Company's loan and investment portfolio, excluding loan
loss reserves, at December 31, 2012 remained relatively unchanged compared to
September 30, 2012 at approximately $1.6 billion. The average balance of the
Company's loan and investment portfolio during the fourth quarter of 2012,
excluding loan loss reserves, was $1.6 billion and the average yield on these
assets for the quarter was 5.10%, compared to $1.6 billion and 5.03% for the
third quarter of 2012.
The balance of debt that finances the Company's loan and investment portfolio
at December 31, 2012 remained relatively unchanged compared to September 30,
2012 at approximately $1.2 billion. The average balance of debt that finances
the Company's loan and investment portfolio was approximately $1.2 billion for
the fourth quarter of 2012, compared to $1.2 billion for the third quarter of
2012. The average cost of borrowings for the fourth quarter was 3.18%,
compared to 3.11% for the third quarter of 2012. In addition, the fourth
quarter of 2012 included a $0.3 million increase in interest expense for a
change in the market value of certain interest rate swaps, compared to a $0.4
million increase in interest expense in the third quarter of 2012. Excluding
the effect of these swaps, the average cost of borrowings for the fourth
quarter was 3.09%, compared to 2.97% for the third quarter of 2012.
Financing Activity
As of December 31, 2012, Arbor's outstanding borrowings for its loan and
investment portfolio totaled approximately $1.2 billion.
On January 28, 2013, Arbor completed its second collateralized loan obligation
("CLO") totaling approximately $260.0 million of real estate related assets
and cash. An aggregate of $177.0 million of investment grade-rated debt was
issued, and Arbor retained an equity interest in the portfolio with a notional
amount of $83.0 million. The notes have an initial weighted average spread of
approximately 235 basis points over one-month LIBOR, excluding fees and
transaction costs. The facility has a two-year replenishment period that
allows the principal proceeds from repayments of the collateral assets to be
reinvested in qualifying replacement assets, subject to certain conditions.
The $260 million of collateral includes $50 million of additional capacity to
finance future loans for a period of up to 90 days from the closing date of
the CLO. Arbor will account for this transaction on its balance sheet as a
financing.
Additionally, in January 2013, the Company amended two of its financing
facilities increasing the committed amount of one facility from $50 million to
$75 million and another from $15 million to $20 million.
In February 2013, the Company closed a one year, $50 million warehouse
facility with a financial institution to finance first mortgage loans on
multifamily properties. The facility has an interest rate of 250 basis points
over LIBOR, a commitment fee, and warehousing and non-use fees, has a maximum
advance rate of 75% and contains certain financial covenants and restrictions.
The Company is subject to various financial covenants and restrictions under
the terms of the Company's CDO/CLO vehicles, credit facilities, and repurchase
agreements. The Company believes that it was in compliance with all financial
covenants and restrictions as of December 31, 2012.
The Company's CDO/CLO vehicles contain interest coverage and asset over
collateralization covenants that must be met as of the waterfall distribution
date in order for the Company to receive such payments. If the Company fails
these covenants in any of its CDOs or CLO, all cash flows from the applicable
vehicle would be diverted to repay principal and interest on the outstanding
bonds and the Company would not receive any residual payments until that
vehicle regained compliance with such covenants. As of the most recent
determination dates in January 2013, the Company was in compliance with all
CDO/CLO covenants. In the event of a breach of the covenants that could not be
cured in the near-term, the Company would be required to fund its non CDO/CLO
expenses, including management fees and employee costs, distributions required
to maintain REIT status, debt costs, and other expenses with (i) cash on hand,
(ii) income from any CDO/CLO not in breach of a covenant test, (iii) income
from real property and loan assets, (iv) sale of assets, (v) or accessing the
equity or debt capital markets, if available.
The chart below is a summary of the Company's CDO/CLO compliance tests as of
the most recent determination dates in January 2013:
Cash Flow Triggers CDO I ^(3) CDO II ^ (3) CDO III ^(3) CLO I
Overcollateralization ^(1)
Current 172.73% 138.89% 105.90% 142.96%
Limit 145.00% 127.30% 105.60% 137.86%
Pass / Fail Pass Pass Pass Pass
Interest Coverage ^(2)
Current 476.34% 453.78% 620.84% 257.78%
Limit 160.00% 147.30% 105.60% 120.00%
Pass / Fail Pass Pass Pass Pass
(1) The overcollateralization ratio divides the total principal balance of
all collateral in the CDO/CLO by the total principal balance of the bonds
associated with the applicable ratio. To the extent an asset is considered a
defaulted security, the asset's principal balance for purposes of the
overcollateralization test is the lesser of the asset's market value or the
principal balance of the defaulted asset multiplied by the asset's recovery
rate which is determined by the rating agencies.
(2) The interest coverage ratio divides interest income by interest expense
for the classes senior to those retained by the Company.
(3) CDO I, CDO II, and CDO III have reached the end of their replenishment
periods. As such, investor capital is repaid quarterly from proceeds
received from loan repayments held as collateral in accordance with the
terms of the respective CDO.
Portfolio Activity
During the fourth quarter of 2012, Arbor purchased five residential
mortgage-backed securities with a total face value of $40.0 million, of which
four residential mortgage-backed securities totaling $36.3 million were
accounted for as derivatives net of financings of $25.2 million in other
assets on the Consolidated Balance Sheets. These securities had paydowns
totaling $0.9 million during the quarter, reducing their combined face value
to $39.1 million as of December 31, 2012. Including this $0.9 million of
paydowns, the securities portfolio had total paydowns of approximately $16.4
million during the quarter.
During the fourth quarter of 2012, Arbor originated nine bridge loans totaling
approximately $84.1 million and one mezzanine loan totaling approximately $6.8
million. In addition, two loans paid off with an unpaid principal balance of
$24.1 million during the quarter. Furthermore, two loans totaling $61.3
million were modified, of which one loan was scheduled to repay during the
quarter.
Additionally, 10 loans totaling approximately $143.6 million were extended
during the quarter, of which two loans totaling $17.5 million were in
accordance with their existing extension options.
At December 31, 2012, the loan and investment portfolio's unpaid principal
balance, excluding loan loss reserves, was approximately $1.6 billion, with a
weighted average current interest pay rate of 4.77%. Including certain fees
earned and costs associated with the loan and investment portfolio, the
weighted average current interest rate was 5.04% at December 31, 2012. At the
same date, advances on financing facilities pertaining to the loan and
investment portfolio totaled approximately $1.2 billion, with a weighted
average interest rate of 3.12% excluding changes in the market value of
certain interest rate swaps.
As of December 31, 2012, Arbor's loan portfolio consisted of 32% fixed-rate
and 68% variable-rate loans.
During the fourth quarter of 2012, the Company recorded $2.5 million in loan
loss reserves related to three loans with a carrying value of approximately
$7.0 million, before loan loss reserves. The loan loss reserves were the
result of the Company's regular quarterly risk rating review process, which is
based on several factors including current market conditions, real estate
values and the operating status of each property. The Company recorded $0.1
million of net recoveries of previously recorded loan loss reserves related to
three of the Company's assets during the fourth quarter of 2012. This recovery
was recorded in provision for loan losses on the Consolidated Statement of
Operations. The Company charged off $30.0 million of previously recorded loan
loss reserves related to one loan during the fourth quarter. At December 31,
2012, the Company's total loan loss reserves were approximately $161.7 million
relating to 20 loans with an aggregate carrying value before loan loss
reserves of approximately $240.2 million. The Company recognizes income on
impaired loans on a cash basis to the extent it is received.
The Company had nine non-performing loans with a carrying value of
approximately $14.9 million, net of related loan loss reserves of $45.1
million as of December 31, 2012, compared to nine non-performing loans with a
carrying value of approximately $9.8 million, net of related loan loss
reserves of $75.1 million as of September 30, 2012. Income recognition on
non-performing loans has been suspended and will resume if and when the loans
become contractually current and performance has recommenced.
Equity Offerings
In October 2012, Arbor issued 3.5 million shares of common stock in a public
offering receiving net proceeds of approximately $19.2 million. The Company
intends to use the net proceeds from the offering to make investments, to
repurchase or pay liabilities and for general corporate purposes.
In February 2013, Arbor completed an underwritten public offering of
approximately 1.6 million shares of its 8.25% Series A Cumulative Redeemable
Preferred Stock generating net proceeds of approximately $37.3 million after
deducting underwriting fees and estimated offering costs. The Company intends
to use the net proceeds from the offering to make investments, to repurchase
or pay liabilities and for general corporate purposes.
Dividend
The Company announced today that its Board of Directors has declared a
quarterly cash dividend of $0.12 per share of common stock for the fourth
quarter ended December 31, 2012. The dividend is payable on March 12, 2013 to
common shareholders of record on March 5, 2013. The ex-dividend date is March
1, 2013.
Earnings Conference Call
Management will host a conference call today at 10:00 a.m. ET. A live webcast
of the conference call will be available online at
http://www.arborrealtytrust.com/ in the investor relations area of the
Website. Those without Web access should access the call telephonically at
least ten minutes prior to the conference call. The dial-in numbers are (866)
356-4441 for domestic callers and (617) 597-5396 for international callers.
Please use participant passcode 15642780.
After the live webcast, the call will remain available on the Company's
Website, www.arborrealtytrust.com, through March 15, 2013. In addition, a
telephonic replay of the call will be available until February 22, 2013. The
replay dial-in number is (888) 286-8010 for domestic callers and (617)
801-6888 for international callers. Please use passcode 93535540.
About Arbor Realty Trust, Inc.
Arbor Realty Trust, Inc. is a real estate investment trust, which invests in a
diversified portfolio of multi-family and commercial real estate related
bridge and mezzanine loans, preferred equity investments, mortgage related
securities and other real estate related assets. Arbor commenced operations in
July 2003 and conducts substantially all of its operations through its
operating partnership, Arbor Realty Limited Partnership and its subsidiaries.
Arbor is externally managed and advised by Arbor Commercial Mortgage, LLC, a
national commercial real estate finance company operating through 14 offices
in the US that specializes in debt and equity financing for multi-family and
commercial real estate.
Safe Harbor Statement
Certain items in this press release may constitute forward-looking statements
within the meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These statements are based on management's
current expectations and beliefs and are subject to a number of trends and
uncertainties that could cause actual results to differ materially from those
described in the forward-looking statements. Arbor can give no assurance that
its expectations will be attained. Factors that could cause actual results to
differ materially from Arbor's expectations include, but are not limited to,
continued ability to source new investments, changes in interest rates and/or
credit spreads, changes in the real estate markets, and other risks detailed
in Arbor's Annual Report on Form 10-K for the year ended December 31, 2012 and
its other reports filed with the SEC. Such forward-looking statements speak
only as of the date of this press release. Arbor expressly disclaims any
obligation or undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change in Arbor's
expectations with regard thereto or change in events, conditions, or
circumstances on which any such statement is based.
Non-GAAP Financial Measures
During the quarterly earnings conference call, the Company may discuss
non-GAAP financial measures as defined by SEC Regulation G. In addition, the
Company has used non-GAAP financial measures in this press release. A
supplemental schedule of each non-GAAP financial measure and the comparable
GAAP financial measure can be found on page 11 and 12 of this release.
1. See attached supplemental schedule of non-GAAP financial measures.
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Quarter Ended Year Ended
December 31, December 31,
2012 2011 2012 2011
(Unaudited) (Unaudited) (Unaudited)
Interest income $ 20,859,047 $ 18,762,829 $ 79,998,762 $ 73,867,556
Interest expense 9,824,542 11,411,004 40,866,832 51,651,933
Net interest 11,034,505 7,351,825 39,131,930 22,215,623
income
Other revenues:
Property operating 5,604,657 4,647,105 30,173,754 23,359,492
income
Other income 544,235 98,050 1,280,289 188,485
Total other 6,148,892 4,745,155 31,454,043 23,547,977
revenues
Other expenses:
Employee
compensation and 3,005,535 4,498,442 10,173,572 11,195,663
benefits
Selling and 2,160,153 2,251,555 7,882,914 7,325,801
administrative
Property operating 6,466,269 6,136,198 27,963,386 21,428,112
expenses
Depreciation and 1,586,921 1,609,776 5,794,013 5,090,498
amortization
Provision for loan
losses (net of 2,362,205 20,224,087 22,946,396 38,542,888
recoveries)
Loss on sale and
restructuring of -- 4,710,000 -- 5,710,000
loans
Management fee - 2,500,000 2,250,000 10,000,000 8,300,000
related party
Total other 18,081,083 41,680,058 84,760,281 97,592,962
expenses
Loss from
continuing
operations before
gain on
extinguishment of (897,686) (29,583,078) (14,174,308) (51,829,362)
debt, income
(loss) from equity
affiliates and
benefit from
income taxes
Gain on
extinguishment of -- 2,958,556 30,459,023 10,878,218
debt
Income (loss) from 2,347 (94,748) (697,856) 3,671,386
equity affiliates
(Loss) income
before benefit (895,339) (26,719,270) 15,586,859 (37,279,758)
from income taxes
Benefit from 275,000 -- 801,558 --
income taxes
(Loss) income from
continuing (620,339) (26,719,270) 16,388,417 (37,279,758)
operations
Loss on impairment
of real estate -- (700,000) -- (1,450,000)
held-for-sale
Gain on sale of
real estate 466,310 -- 3,953,455 --
held-for-sale
(Loss) income from
operations of real (59,241) (308,591) 1,374,583 (1,366,299)
estate
held-for-sale
Income (loss) from
discontinued 407,069 (1,008,591) 5,328,038 (2,816,299)
operations
Net (loss) income (213,270) (27,727,861) 21,716,455 (40,096,057)
Net income
attributable to 53,969 54,037 215,567 215,656
noncontrolling
interest
Net (loss) income
attributable to $ (267,239) $ (27,781,898) $ 21,500,888 $ (40,311,713)
Arbor Realty
Trust, Inc.
Basic (loss)
earnings per
common share:
(Loss) income from
continuing
operations, net of $ (0.02) $ (1.11) $ 0.60 $ (1.50)
noncontrolling
interest
Income (loss) from
discontinued 0.01 (0.04) 0.20 (0.11)
operations
Net (loss) income
attributable to $ (0.01) $ (1.15) $ 0.80 $ (1.61)
Arbor Realty
Trust, Inc.
Diluted (loss)
earnings per
common share:
(Loss) income from
continuing
operations, net of $ (0.02) $ (1.11) $ 0.59 $ (1.50)
noncontrolling
interest
Income (loss) from
discontinued 0.01 (0.04) 0.20 (0.11)
operations
Net (loss) income
attributable to $ (0.01) $ (1.15) $ 0.79 $ (1.61)
Arbor Realty
Trust, Inc.
Dividends declared $ 0.110 $ -- $ 0.285 $ --
per common share
Weighted average
number of
shares of common
stock
outstanding:
Basic 30,868,790 24,239,100 26,956,938 24,968,894
Diluted 30,868,790 24,239,100 27,211,287 24,968,894
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31, December 31,
2012 2011
(Unaudited)
Assets:
Cash and cash equivalents $ 29,188,889 $ 55,236,479
Restricted cash (includes $41,537,212 and
$65,357,993 from consolidated VIEs, 42,535,514 67,326,530
respectively)
Loans and investments, net (includes
$1,113,745,356 and $1,093,893,014 from 1,325,667,053 1,302,440,660
consolidated VIEs, respectively)
Available-for-sale securities, at fair value
(includes $1,100,000 and $2,000,000 from 3,552,736 4,276,368
consolidated VIEs, respectively)
Securities held-to-maturity, net (includes
$0 and $742,602 from consolidated VIEs, 42,986,980 29,942,108
respectively)
Investment in equity affiliates 59,581,242 60,450,064
Real estate owned, net (includes $80,787,215
and $83,099,540 from consolidated VIEs, 124,148,199 128,397,612
respectively)
Real estate held-for-sale, net (includes $0
and $2,550,000 from consolidated VIEs, -- 62,084,412
respectively)
Due from related party (includes $0 and 24,094 656,290
$1,217 from consolidated VIEs, respectively)
Prepaid management fee - related party 19,047,949 19,047,949
Other assets (includes $11,709,103 and
$11,696,071 from consolidated VIEs, 55,148,624 46,855,858
respectively)
Total assets $ 1,701,881,280 $ 1,776,714,330
Liabilities and Equity:
Repurchase agreements and credit facilities $ 130,661,619 $ 76,105,000
Collateralized debt obligations (includes
$812,452,845 and $1,002,615,393 from 812,452,845 1,002,615,393
consolidated VIEs, respectively)
Collateralized loan obligations (includes
$87,500,000 and $0 from consolidated VIEs, 87,500,000 --
respectively)
Junior subordinated notes to subsidiary 158,767,145 158,261,468
trust issuing preferred securities
Notes payable 51,457,708 85,457,708
Mortgage notes payable – real estate owned 53,751,004 53,751,004
Mortgage note payable – held-for-sale -- 62,190,000
Due to related party 3,084,627 2,728,819
Due to borrowers (includes $1,320,943 and
$740,809 from consolidated VIEs, 23,056,640 2,825,636
respectively)
Deferred revenue 77,123,133 77,123,133
Other liabilities (includes $22,013,896 and
$27,839,757 from consolidated VIEs, 72,765,437 82,595,636
respectively)
Total liabilities 1,470,620,158 1,603,653,797
Commitments and contingencies -- --
Equity:
Arbor Realty Trust, Inc. stockholders'
equity:
Preferred stock, $0.01 par value:
100,000,000 shares authorized; no shares -- --
issued or outstanding
Common stock, $0.01 par value: 500,000,000
shares authorized; 33,899,992 shares issued,
31,249,225 shares outstanding at December 339,000 267,787
31, 2012 and 26,778,737 shares issued,
24,298,140 shares outstanding at December
31, 2011
Additional paid-in capital 493,211,222 455,994,695
Treasury stock, at cost - 2,650,767 shares
at December 31, 2012 and 2,480,597 shares at (17,100,916) (16,416,152)
December 31, 2011
Accumulated deficit (207,558,257) (221,015,880)
Accumulated other comprehensive loss (39,561,700) (47,704,045)
Total Arbor Realty Trust, Inc. stockholders' 229,329,349 171,126,405
equity
Noncontrolling interest in consolidated 1,931,773 1,934,128
entity
Total equity 231,261,122 173,060,533
Total liabilities and equity $ 1,701,881,280 $ 1,776,714,330
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULE OF NON-GAAP FINANCIAL MEASURES
(Unaudited)
December 31,
2012
GAAP Arbor Realty Trust, Inc. Stockholders' Equity $ 229,329,349
Add: 450 West 33rd Street transaction - deferred revenue 77,123,133
Unrealized loss on derivative instruments 37,754,775
Subtract: 450 West 33rd Street transaction - prepaid (19,047,949)
management fee
Adjusted Arbor Realty Trust, Inc. Stockholders' Equity $ 325,159,308
Adjusted book value per share $ 10.41
GAAP book value per share $ 7.34
Common shares outstanding 31,249,225
Given the magnitude and the deferral structure of the 450 West 33rd Street
transaction combined with the change in the fair value of certain derivative
instruments, Arbor has elected to report adjusted book value per share for the
affected period to currently reflect the future impact of the 450 West 33rd
Street transaction on the Company's financial condition as well as the
evaluation of Arbor without the effects of unrealized losses from certain of
the Company's derivative instruments. Management considers this non-GAAP
financial measure to be an effective indicator, for both management and
investors, of Arbor's financial performance. Arbor's management does not
advocate that investors consider this non-GAAP financial measure in isolation
from, or as a substitute for, financial measures prepared in accordance with
GAAP.
GAAP book value per share and adjusted book value per share calculations do
not take into account any dilution from the potential exercise of the warrants
issued to Wachovia as part of the 2009 debt restructuring.
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
SUPPLEMENTAL SCHEDULE OF NON-GAAP FINANCIAL MEASURES - Continued
(Unaudited)
Quarter Ended Year Ended
December 31, December 31,
2012 2011 2012 2011
Net (loss) income
attributable to Arbor $ (267,239) $ (27,781,898) $ 21,500,888 $ (40,311,713)
Realty Trust, Inc.,
GAAP basis
Subtract:
Gain on sale of real (466,310) -- (3,953,455) --
estate-held-for-sale
Add:
Loss on impairment
of real -- 700,000 -- 1,450,000
estate-held-for-sale
Depreciation - real
estate owned and 1,612,605 1,820,565 5,904,089 5,951,525
held-for-sale (1)
Depreciation -
investment in equity 9,589 331,544 90,396 331,544
affiliate
Funds from $ 888,645 $ (24,929,789) $ 23,541,918 $ (32,578,644)
operations ("FFO")
Diluted FFO per $ 0.03 $ (1.03) $ 0.87 $ (1.30)
common share
Diluted weighted
average shares 31,143,198 24,239,100 27,211,287 24,968,894
outstanding
(1) Includes discontinued operations
Arbor is presenting funds from operations, or FFO, because management believes
it to be an important supplemental measure of the Company's operating
performance in that it is frequently used by analysts, investors and other
parties in the evaluation of real estate investment trusts (REITs). The
revised White Paper on FFO approved by the Board of Governors of the National
Association of Real Estate Investment Trusts, or NAREIT, in April 2002 defines
FFO as net income (loss) attributable to Arbor Realty Trust, Inc. (computed in
accordance with generally accepted accounting principles (GAAP)), excluding
gains (losses) from sales of depreciated real properties, plus impairments of
depreciated real properties and real estate related depreciation and
amortization, and after adjustments for unconsolidated partnerships and joint
ventures. The Company considers gains and losses on the sales of undepreciated
real estate investments to be a normal part of its recurring operating
activities in accordance with GAAP and should not be excluded when calculating
FFO. Losses from discontinued operations are not excluded when calculating
FFO.
FFO is not intended to be an indication of our cash flow from operating
activities (determined in accordance with GAAP) or a measure of our liquidity,
nor is it entirely indicative of funding our cash needs, including our ability
to make cash distributions. Arbor's calculation of FFO may be different from
the calculation used by other companies and, therefore, comparability may be
limited.
CONTACT: Arbor Realty Trust, Inc.
Paul Elenio, Chief Financial Officer
516-506-4422
pelenio@arbor.com
Investors:
Stephanie Carrington / Amy Glynn
The Ruth Group
646-536-7023
scarrington@theruthgroup.com
aglynn@theruthgroup.com
Media:
Bonnie Habyan, EVP of Marketing
516-506-4615
bhabyan@arbor.com
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