W. P. Carey Announces Fourth Quarter and Year-End 2012 Financial Results

W. P. Carey Announces Fourth Quarter and Year-End 2012 Financial Results 
NEW YORK, NY -- (Marketwire) -- 02/26/13 --  W. P. Carey Inc. (NYSE:
WPC), a real estate investment trust ("REIT"), today reported
financial results for the fourth quarter and year-ended December 31,
2012. 
2012 HIGHLIGHTS 
During 2012, the Company: 


 
--  Reported AFFO of $1.13 per diluted share for the fourth quarter and
    $3.76 per diluted share for the year ended December 31, 2012
--  Completed merger with CPA(R):15 and commenced trading as a REIT on
    October 1, 2012
--  Structured $618 million of investments on behalf of CPA(R):17 -
    Global in the fourth quarter and $1.0 billion for the full year
--  Increased assets under ownership and management by 17% to $14.1
    billion for the full year
--  Raised annualized dividend rate to $2.64 per share in the fourth
    quarter, an increase of 17% versus the fourth quarter of 2011 and
    WPC's 47th consecutive quarterly increase
--  Generated a total shareholder return of approximately 34% for the year
    ended December 31, 2012

  
QUARTERLY AND YEAR-END RESULTS 


 
--  Funds from operations -- as adjusted (AFFO) for the fourth quarter of
    2012 was $78.8 million or $1.13 per diluted share, compared to $35.2
    million or $0.88 per diluted share for the fourth quarter of 2011.
    AFFO for the year ended December 31, 2012 was $180.6 million or $3.76
    per diluted share, compared to $188.9 million or $4.71 per diluted
    share for 2011. The year-over-year decrease was due to non-recurring
    fee revenue we earned from the merger of two of our managed CPA(R)
    REITs in May 2011. Per share data for the 2012 periods reflects the
    issuance of 28.2 million shares in connection with our merger with
    CPA(R):15.
--  Cash flow from operating activities for the year ended December 31,
    2012 was $80.6 million, compared to $80.1 million for 2011.
--  Total revenues net of reimbursed expenses for the fourth quarter of
    2012 were $128.9 million, compared to $45.6 million for the fourth
    quarter of 2011. Total revenues net of reimbursed expenses for the
    year ended December 31, 2012 were $275.8 million, compared to $263.0
    million in 2011. Reimbursed expenses are excluded from total revenues
    bec
ause they have no impact on net income.
--  Net Income for the fourth quarter of 2012 was $15.5 million, compared
    to $9.1 million for the same period in 2011. For the year ended
    December 31, 2012, net income was $62.1 million, compared to $139.1
    million for 2011.
--  For the year ended December 31, 2012, we received approximately $31.5
    million in cash distributions from our equity ownership in the
    CPA(R) REITs. We also received $30 million in cash distributions
    for our special general partnership interest in the CPA(R) REITs.
--  Further information concerning AFFO, a non-GAAP supplemental
    performance metric, is presented in the accompanying tables and
    related notes.

  
CONVERSION TO A REIT AND MERGER WITH CPA(R):15  


 
--  W. P. Carey's conversion to a REIT and merger with CPA(R):15 closed
    on September 28, 2012 and W. P. Carey Inc. commenced trading on the
    New York Stock Exchange as a REIT on October 1, 2012.
--  These transactions are part of a larger transformation to implement
    our overall business strategy of expanding real estate assets under
    ownership, which in turn is expected to provide a platform for future
    growth.

  
W. P. CAREY OWNED PORTFOLIO UPDATE 


 
--  Through our merger with CPA(R):15, we acquired a portfolio of 305
    diversified net lease assets for $2.6 billion.
--  During the year, we completed acquisitions totaling approximately $152
    million, including the remaining interest in an existing portfolio of
    12 Marriott Courtyard hotels and five Walgreens retail stores.
--  In January 2013, W. P. Carey completed a sale-leaseback with Kraft
    Foods Group for their Northfield, Illinois campus. The 679,000 square
    foot facility is home to Kraft's corporate headquarters.
--  The W. P. Carey owned portfolio currently consists of 423 properties
    comprising 38.5 million square feet leased to more than 120 corporate
    tenants. The average lease term of the portfolio is 8.9 years and the
    occupancy rate is approximately 98.7%.

  
INVESTMENT MANAGEMENT UPDATE 


 
--  W. P. Carey is the advisor to the CPA(R) REITs and CWI, which had
    aggregate real estate assets of $7.9 billion, cash of approximately
    $750 million and total assets of $8.5 billion as of December 31, 2012.
--  The average occupancy rate for the 83 million square feet owned by the
    CPA(R) REITs was approximately 98.2%.

  
CPA(R):17 - GLOBAL ACTIVITY 


 
--  In December 2012, CPA(R):17 - Global closed to new investments,
    having raised $2.9 billion since its initial public offering, which
    commenced in 2007.
--  Investment volume for CPA(R):17 - Global in the fourth quarter of
    2012 was approximately $618 million and $1.0 billion for the year.
--  We completed our first transaction in Japan through a $47 million
    acquisition of assets leased to Wanbishi Archives Co., Ltd., the
    largest information/document management company in Japan.

  
CAREY WATERMARK INVESTORS ACTIVITY 


 
--  From the beginning of its initial public offering through February 22,
    2013, our lodging-focused non-traded REIT offering has raised
    approximately $194 million.
--  During 2012, we invested in five hotels for a total of approximately
    $170 million.

  
DIVIDENDS 


 
--  The W. P. Carey Board of Directors raised the quarterly cash dividend
    to $0.66 per share for the fourth quarter of 2012. The dividend -- our
    47th consecutive quarterly increase -- was paid on January 15, 2013 to
    stockholders of record as of December 31, 2012. Over the course of the
    year, we increased our dividend by 17%, to an annualized rate of $2.64
    per share.

  
W. P. Carey President and CEO Trevor Bond noted, "2012 was a landmark
year for us in many ways. We completed our conversion to REIT status
and our merger with CPA(R):15 in September. We announced record
acquisitions volume of $1.4 billion, and assets under management grew
from $12.1 billion to $14.1 billion over the course of the year. As
we enter our 40th year as a leader in the net lease sector, we're
well-positioned to build on the accomplishments of 2012, continuing
to adhere to our proven investment strategy of Investing for the Long
Run." 
CONFERENCE CALL & WEBCAST 
Please call at least 10 minutes prior to call to register. 
Time: Tuesday, February 26, 2013 at 11:00 AM (ET) 
Call-in Number: 800-860-2442 
(International) +1-412-858-4600  
Webcast: www.wpcarey.com/earnings 
Podcast: www.wpcarey.com/podcast 
Available after 2:00 PM (ET) 
Replay Number: 877-344-7529 
(International) + 1-412-317-0088 
Replay Passcode: 10023829 
Replay available until March 22, 2013 at 9:00 AM (ET).  
W. P. Carey Inc.
 Celebrating its 40th anniversary, W. P. Carey Inc.
is a publicly traded REIT (NYSE: WPC) that provides long-term
sale-leaseback and build-to-suit financing for companies worldwide
and owns and manages an investment portfolio totaling approximately
$14.1 billion. The largest owner/manager of net lease assets, WPC's
corporate finance-focused credit and real estate underwriting process
is a constant that has been successfully leveraged across a wide
variety of industries and property types. Our portfolio of long-term 
leases with creditworthy tenants has an established history of
generating stable cash flows that have enabled the Company to deliver
consistent and rising dividend income to investors for nearly four
decades. www.wpcarey.com 
This press release contains forward-looking statements within the
meaning of the Federal securities laws. Examples of such
forward-looking statements include, but are not limited to, the
statements made by Mr. Bond. A number of factors could cause W. P.
Carey's actual results, performance or achievement to differ
materially from those anticipated. Among those risks, trends and
uncertainties are the general economic climate; the supply of and
demand for office and industrial properties; interest rate levels;
the availability of financing; and other risks associated with the
acquisition and ownership of properties, including risks that the
tenants will not pay rent, or that costs may be greater than
anticipated. For further information on factors that could impact W.
P. Carey, reference is made to W. P. Carey's filings with the
Securities and Exchange Commission. 


 
                                                                            
                              W. P. CAREY INC.                              
                                                                            
                     CONSOLIDATED STATEMENTS OF INCOME                      
             (in thousands, except share and per share amounts)             
                                                                            
                                             Years Ended December 31,       
                                      ------------------------------------- 
                                          2012         2011         2010    
                                      -----------  -----------  ----------- 
Revenues                                                                    
  Lease revenues:                                                           
    Rental income                     $   108,707  $    52,360  $    41,940 
    Interest income from direct                                             
     financing leases                      15,796       10,278        9,542 
                                      -----------  -----------  ----------- 
  Total lease revenues                    124,503       62,638       51,482 
  Asset management revenue from                                             
   affiliates                              56,666       66,808       76,246 
  Structuring revenue from affiliates      48,355       46,831       44,525 
  Incentive, termination and                                                
   subordinated disposition revenue                                         
   from affiliates                              -       52,515            - 
  Wholesaling revenue                      19,914       11,664       11,096 
  Reimbursed costs from affiliates         98,245       64,829       60,023 
  Other real estate income                 26,312       22,499       17,273 
                                      -----------  -----------  ----------- 
                                          373,995      327,784      260,645 
                                      -----------  -----------  ----------- 
Operating Expenses                                                          
  General and administrative             (144,809)     (93,733)     (73,427)
  Reimbursable costs                      (98,245)     (64,829)     (60,023)
  Depreciation and amortization           (48,790)     (24,347)     (18,309)
  Property expenses                       (13,041)     (10,145)      (8,009)
  Other real estate expenses               (9,850)     (10,784)      (8,121)
  Impairment charges                      (10,467)       1,365       (1,140)
                                      -----------  -----------  ----------- 
                                         (325,202)    (202,473)    (169,029)
                                      -----------  -----------  ----------- 
Other Income and Expenses                                                   
  Other interest income                     1,396        2,001        1,269 
  Income from equity investments in                                         
   real estate and the Managed REITs       62,392       51,228       30,992 
  Gain on change in control of                                              
   interests                               20,744       27,859          781 
  Other income and (expenses)               3,402        4,578          627 
  Interest expense                        (50,573)     (21,770)     (15,636)
                                      -----------  -----------  ----------- 
                                           37,361       63,896       18,033 
                                      -----------  -----------  ----------- 
  Income from continuing operations                                         
   before income taxes                     86,154      189,207      109,649 
  Provision for income taxes               (6,783)     (37,214)     (25,814)
                                      -----------  -----------  ----------- 
  Income from continuing operations        79,371      151,993       83,835 
                                      -----------  -----------  ----------- 
Discontinued Operations                                                     
  Income from operations of                                                 
   discontinued properties                    922        1,366        4,897 
  Gain on deconsolidation of a                                              
   subsidiary                                   -        1,008            - 
  (Loss) gain on sale of real estate       (5,019)      (3,391)         460 
  Impairment charges                      (12,495)     (11,838)     (14,241)
                                      -----------  -----------  ----------- 
  Loss from discontinued operations,                                        
   net of tax                             (16,592)     (12,855)      (8,884)
                                      -----------  -----------  ----------- 
Net Income                                 62,779      139,138       74,951 
  Net (income) loss attributable to                                         
   noncontrolling interests                  (607)       1,864          314 
  Less: Net income attributable to                                          
   redeemable noncontrolling interest         (40)      (1,923)      (1,293)
                                      -----------  -----------  ----------- 
Net Income Attributable to W. P.                                            
 Carey                                $    62,132  $   139,079  $    73,972 
                                      ===========  ===========  =========== 
                                                                            
Basic Earnings Per Share                                                    
  Income from continuing operations                                         
   attributable to W. P. Carey        $      1.65  $      3.76  $      2.08 
  Loss from discontinued operations                                         
   attributable to W. P. Carey              (0.35)       (0.32)       (0.
22)
                                      -----------  -----------  ----------- 
  Net income attributable to W. P.                                          
   Carey                              $      1.30  $      3.44  $      1.86 
                                      ===========  ===========  =========== 
                                                                            
Diluted Earnings Per Share                                                  
  Income from continuing operations                                         
   attributable to W. P. Carey        $      1.62  $      3.74  $      2.08 
  Loss from discontinued operations                                         
   attributable to W. P. Carey              (0.34)       (0.32)       (0.22)
                                      -----------  -----------  ----------- 
  Net income attributable to W. P.                                          
   Carey                              $      1.28  $      3.42  $      1.86 
     
                                 ===========  ===========  =========== 
                                                                            
Weighted Average Shares Outstanding                                         
  Basic                                47,389,460   39,819,475   39,514,746 
                                      ===========  ===========  =========== 
  Diluted                              48,078,474   40,098,095   40,007,894 
                                      ===========  ===========  =========== 
                                                                            
Amounts Attributable to W. P. Carey                                         
  Income from continuing operations,                                        
   net of tax                         $    78,724  $   151,934  $    82,856 
  Loss from discontinued operations,                                        
   net of tax                             (16,592)     (12,855)      (8,884)
                                      -----------  -----------  ----------- 
  Net income attributable to W. P.                                          
   Carey                              $    62,132  $   139,079  $    73,972 
                                      ===========  ===========  =========== 
                                                                            
                                                                            
                                                                            
                              W. P. CAREY INC.                              
                                                                            
                   CONSOLIDATED STATEMENTS OF CASH FLOWS                    
                               (in thousands)                               
                                                                            
                                             Years Ended December 31,       
                                      ------------------------------------- 
                                          2012         2011         2010    
                                      -----------  -----------  ----------- 
Cash Flows -- Operating Activities                                          
Net income                            $    62,779  $   139,138  $    74,951 
Adjustments to net income:                                                  
  Depreciation and amortization,                                            
   including intangible assets and                                          
   deferred financing costs                55,114       29,616       24,443 
  (Income) loss from equity                                                 
   investments in real estate and the                                       
   Managed REITs in excess of                                               
   distributions received                 (17,271)         310       (4,920)
  Straight-line rent, financing lease                                       
   adjustments and amortization of                                          
   rent-related intangibles                 2,831       (3,698)         286 
  Amortization of deferred revenue         (9,436)      (6,291)           - 
  Gain on deconsolidation of a                                              
   subsidiary                                   -       (1,008)           - 
  Loss (gain) on sale of real estate        2,773        3,391         (460)
  Unrealized (gain) loss on foreign                                         
   currency transactions and others        (1,861)         138          300 
  Realized loss (gain) on foreign                                           
   currency transactions and others           610         (965)        (731)
  Allocation of loss to profit-                                             
   sharing interest                             -            -         (781)
  Management and disposition income                                         
   received in shares of Managed                                            
   REITs                                  (28,477)     (73,936)     (35,235)
  Gain on conversion of shares                (15)      (3,806)           - 
  Gain on change in control of                                              
   interests                              (20,794)     (27,859)           - 
  Impairment charges                       22,962       10,473       15,381 
  Stock-based compensation expense         26,038       17,716        7,082 
  Deferred acquisition revenue                                              
   received                                21,059       21,546       21,204 
  Increase in structuring revenue                                           
   receivable                             (20,304)     (19,537)     (20,237)
  (Decrease) increase in income                                             
   taxes, net                             (18,277)         244       (1,288)
  Net changes in other operating                                            
   assets and liabilities                   2,912       (5,356)       6,422 
                                      -----------  -----------  ----------- 
Net Cash Provided by Operating                                              
 Activities                                80,643       80,116       86,417 
                                      -----------  -----------  ----------- 
                                                                            
Cash Flows -- Investing Activities                                          
  Cash paid to stockholders of                                              
   CPA(R):15 in the Merger                 (152,356)           -            - 
  Cash acquired in connection with                                          
   the Merger                             178,945            -            - 
  Distributions received from equity                                        
   investments in real estate and the                                       
   Managed REITs in excess of equity                                        
   income                                  46,294       20,807       18,758 
  Capital contributions to equity                                           
   investments                               (726)      (2,297)           - 
  Purchase of interests in CPA(R):16 --                                       
   Global                                       -     (121,315)           - 
  Purchases of real estate and equity                                       
   investments in real estate              (3,944)     (24,315)     (96,884)
  Value added taxes ("VAT") paid in                                         
   connection with acquisition of                                           
   real estate                                  -            -       (4,222)
  VAT refunded in connection with                                      
     
   acquisitions of real estate                  -        5,035            - 
  Capital expenditures                     (6,204)     (13,239)      (5,135)
  Cash acquired on acquisition of                                           
   subsidiaries                                 -           57            - 
  Proceeds from sale of real estate        73,204       12,516       14,591 
  Proceeds from sale of securities            372          818            - 
  Funding of short-term loans to                                            
   affiliates                                   -      (96,000)           - 
  Proceeds from repayment of short-                                         
   term loans to affiliates                     -       96,000            - 
  Funds placed in escrow                  (46,951)      (6,735)      (1,571)
  Funds released from escrow               37,832        2,584       36,620 
                                      -----------  -----------  ----------- 
Net Cash Provided by (Used in)                                              
 Investing Activities                     126,466     (126,084)     (37,843)
                                      -----------  -----------  ----------- 
                                                                            
Cash Flows -- Financing Activities                                          
  Distributions paid                     (113,867)     (85,814)     (92,591)
  Contributions from noncontrolling                                         
   interests                                3,291        3,223       14,261 
  Distributions paid to                                                     
   noncontrolling interests                (7,314)      (7,258)      (4,360)
  Contributions from profit-sharing                                         
   interest                                     -            -        3,694 
  Distributions to profit-sharing                                           
   interest                                     -            -         (693)
  Purchase of noncontrolling interest           -       (7,502)           - 
  Purchase of treasury stock from                                           
   related party (Note ##RPF_FN)          (45,270)           -            - 
  Scheduled payments of mortgage                                            
   principal                              (54,964)     (25,327)     (14,324)
  Proceeds from mortgage financing         23,750       45,491       56,841 
  Proceeds from senior credit                                               
   facility                               300,000      251,410       83,250 
  Repayments of senior credit                                               
   facility                              (280,160)    (160,000)     (52,500)
  Payment of financing costs               (2,557)      (7,778)      (1,204)
  Funds placed in escrow                    1,970            -            - 
  Proceeds from issuance of shares         51,644        1,488        3,724 
  Windfall tax benefit associated                                           
   with stock-based compensation                                            
   awards                                  10,185        2,569        2,354 
                                      -----------  -----------  ----------- 
Net Cash (Used in) Provided by                                              
 Financing Activities                    (113,292)      10,502       (1,548)
                                      -----------  -----------  ----------- 
                                                                            
Change in Cash and Cash Equivalents                                         
 During the Year                                                            
    Effect of exchange rate changes                                         
     on cash                                  790           70         (783)
                                      -----------  -----------  ----------- 
    Net increase (decrease) in cash                                         
     and cash equivalents                  94,607      (35,396)      46,243 
  Cash and cash equivalents,                                                
   beginning of year                       29,297       64,693       18,450 
                                      -----------  -----------  ----------- 
  Cash and cash equivalents, end of                                         
   year                               $   123,904  $    29,297  $    64,693 
                                      ===========  ===========  =========== 
                                                                            
                                                                            
                                                                            
                              W. P. CAREY INC.                              
                                                                            
                      Financial Highlights (Unaudited)                      
                  (in thousands, except per share amounts)                  

 
These financial highlights include non-GAAP financial measures,
including earnings before interest, taxes, depreciation and
amortization ("EBITDA") and funds from operations - as adjusted
("AFFO"). A description of these non-GAAP financial measures and
reconciliations to the most directly comparable GAAP measures is
provided on the following pages. 


 
                                                                            
                                   Three Months Ended       Years Ended     
                                      December 31,          December 31,    
                                 --------------------- ---------------------
                                    2012       2011       2012       2011   
                                 ---------- ---------- ---------- ----------
EBITDA(a)                                                                   
Investment management            $   15,824 $    1,141 $   23,752 $   91,234
Real estate ownership                64,603     22,487    146,885    137,106
                                 ---------- ---------- ---------- ----------
Total                            $   80,427 $   23,628 $  170,637 $  228,340
                                 ========== ========== ========== ==========
                                                                            
AFFO(a)                                                                     
Investment management            $   14,116 $    7,002 $   21,120 $   86,105
Real estate ownership                64,705     28,207    159,511    102,748
                                 ---------- ---------- ---------- ----------
Total                            $   78,821 $   35,209 $  180,631 $  188,853
                                 ========== ========== ========== ==========
                                                                            
EBITDA Per Share (Diluted)(a)                                               
Investment management            $     0.23 $     0.03 $     0.49 $     2.28
Real estate ownership                  0.93       0.56       3.06       3.41
                                 ---------- ---------- ---------- ----------
Total                            $     1.16 $     0.59 $     3.55 $     5.69
                                 ========== ========== ========== ==========
                                                                            
AFFO Per Share (Diluted)(a)                                                 
Investment management            $     0.20 $     0.17 $     0.44 $     2.15
Real estate ownership                  0.93       0.71       3.32       2.56
                                 ---------- ---------- ---------- ----------
Total         
                   $     1.13 $     0.88 $     3.76 $     4.71
                                 ========== ========== ========== ==========
                                                                            
(a) Effective April 1, 2012, we include cash distributions and deferred     
    revenue received and earned from the operating partnerships of CPA(R):16 -
    Global, CPA(R):17 - Global and CWI in our Real Estate Ownership segment.  
    Results of operations for the prior year periods have been reclassified 
    to conform to the current period presentation.                          
                                                                            
                                                                            
                                                                            
                              W. P. CAREY INC.                              
                                                                            
             Reconciliation of Net Income to EBITDA (Unaudited)             
             (in thousands, except share and per share amounts)             
                                                                            
                               Three Months Ended          Years Ended      
                                  December 31,             December 31,     
                            -----------------------  -----------------------
                                2012        2011         2012        2011   
                            ----------- -----------  ----------- -----------
Investment Management                                                       
Net income from investment                                                  
 management attributable to                                                 
 W.P. Carey (a)             $     9,971 $     3,705  $    17,237 $    52,799
Adjustments:                                                                
  Provision for income                                                      
   taxes                          4,926      (3,540)       2,771      34,971
  Depreciation and                                                          
   amortization                     927         976        3,744       3,464
                            ----------- -----------  ----------- -----------
  EBITDA -- investment                                                      
   management               $    15,824 $     1,141  $    23,752 $    91,234
                            =========== ===========  =========== ===========
  EBITDA per share                                                          
   (diluted)                $      0.23 $      0.03  $      0.49 $      2.28
                            =========== ===========  =========== ===========
                                                                            
Real Estate Ownership                                                       
Net income from real estate                                                 
 ownership attributable to                                                  
 W. P. Carey (a)            $     5,507 $     5,386  $    44,895 $    86,280
Adjustments:                                                                
  Interest expense               28,250       6,219       50,573      21,770
  Provision for income                                                      
   taxes                          1,665       2,227        4,012       2,243
  Depreciation and                                                          
   amortization                  28,587       7,352       45,046      20,883
  Reconciling items                                                         
   attributable to                                                          
   discontinued operations          594       1,303        2,359       5,930
                            ----------- -----------  ----------- -----------
EBITDA -- real estate                                                       
 ownership                  $    64,603 $    22,487  $   146,885 $   137,106
                            =========== ===========  =========== ===========
EBITDA per share (diluted)  $      0.93 $      0.56  $      3.06 $      3.41
                            =========== ===========  =========== ===========
                                                                            
Total Company                                                               
EBITDA                      $    80,427 $    23,628  $   170,637 $   228,340
                            =========== ===========  =========== ===========
EBITDA per share (diluted)  $      1.16 $      0.59  $      3.55 $      5.69
                            =========== ===========  =========== ===========
Diluted weighted average                                                    
 shares outstanding          69,505,871  40,152,444   48,078,474  40,098,095
                            =========== ===========  =========== ===========
                                                                            
(a) Effective April 1, 2012, we include cash distributions and deferred     
    revenue received and earned from the operating partnerships of CPA(R):16 -
    Global, CPA(R):17 - Global and CWI in our Real Estate Ownership segment.  
    Results of operations for the prior year periods have been reclassified 
    to conform to the current period presentation.                          

 
Non-GAAP Financial Disclosure 
EBITDA as disclosed represents earnings before interest, taxes,
depreciation and amortization. We believe that EBITDA is a useful
supplemental measure to investors and analysts for assessing the
performance of our business segments, although it does not represent
net income that is computed in accordance with GAAP, because it
removes the impact of our capital structure and asset base from our
operating results and because it is helpful when comparing our
operating performance to that of companies in our industry without
regard to such items, which can vary substantially from company to
company. Accordingly, EBITDA should not be considered as an
alternative to net income as an indicator of our financial
performance. EBITDA may not be comparable to similarly titled
measures of other companies. Therefore, we use EBITDA as one measure
of our operating performance when we formulate corporate goals,
evaluate the effectiveness of our strategies, and determine executive
compensation. 


 
                                                                            
                              W. P. CAREY INC.                              
                                                                            
Reconciliation of Net Income to Funds From Operations -- as adjusted (AFFO) 
                                 (Unaudited)                                
             (in thousands, except share and per share amounts)             
                                                                            
                            Three Months Ended            Years Ended       
                               December 31,              December 31,       
                         ------------------------  ------------------------ 
                             2012         2011         2012         2011    
                         -----------  -----------  -----------  ----------- 
Real Estate Ownership                                                       
Net income from real                                                        
 estate ownership                                                           
 attributable to W. P.                                                      
 Carey (a)               $     5,507  $     5,
386  $    44,895  $    86,280 
                         -----------  -----------  -----------  ----------- 
  Adjustments:                                                              
    Depreciation and                                                        
     amortization of                                                        
     real property            28,652        8,415       45,982       25,324 
    Impairment charges        10,700        5,498       22,962       10,473 
    Loss on sale of real                                                    
     estate, net               4,240        3,655        2,676        3,391 
    Proportionate share                                                     
     of adjustments to                                                      
     equity in net                                                          
     income of -                                                            
     partially owned                                                        
     entities to arrive                                                     
     at FFO:                                                                
      Depreciation and                                                      
       amortization of                                                      
       real property           3,210        1,208        5,545        5,257 
      Impairment charges           -            -            -        1,090 
      Loss (gain) on                                                        
       sale of real                                                         
       estate, net                 1            -      (15,233)          34 
    Proportionate share                                                     
     of adjustments for                                                     
     noncontrolling                                                         
     interests to arrive                                                    
     at FFO                   (4,236)        (508)      (5,504)      (1,984)
                         -----------  -----------  -----------  ----------- 
  Total adjustments:          42,567       18,268       56,428       43,585 
                         -----------  -----------  -----------  ----------- 
FFO - as defined by                                                         
 NAREIT                       48,074       23,654      101,323      129,865 
                         -----------  -----------  -----------  ----------- 
  Adjustments:                                                              
    Loss (gain) on                                                          
     change in control                                                      
     of interests (b)(c)          60            -      (20,734)     (27,859)
    Gain on                                                                 
     deconsolidation of                                                     
     a subsidiary                  -            -            -       (1,008)
    Other gains, net              (2)      (1,118)          (2)          25 
    Other depreciation,                                                     
     amortization and                                                       
     non-cash charges         (1,556)       3,398       (1,662)         176 
    Stock based                                                             
     compensation                211           57          211          220 
    Deferred tax expense        (644)      (2,602)      (2,745)      (3,184)
    Realized losses on                                                      
     foreign currency,                                                      
     derivatives and                                                        
     other (d)                   171            -          828            - 
    Amortization of                                                         
     def
erred financing                                                     
     costs (d)                   468            -        1,843            - 
    Straight-line and                                                       
     other rent                                                             
     adjustments              (2,248)      (1,804)      (4,446)      (4,255)
    Above/below market                                                      
     rent intangible                                                        
     lease amortization,                                                    
     net (d)                   7,534            -        7,696            - 
    Merger expense (e)         1,049            -       41,338            - 
    Proportionate share                                                     
     of adjustments to                                                      
     equity in net                                                          
     income ofpartially                                                     
     owned entities to                                                      
     arrive at AFFO:                                                        
      Other                                                                 
       depreciation,                                                        
       amortization and                                                     
       non-cash charges          624            -          624            - 
      Straight-line and                                                     
       other rent                                                           
       adjustments              (667)        (414)      (1,468)      (1,641)
      Above/below market                                                    
       rent intangible                                                      
       lease                                                                
       amortization, net         166            -          163            - 
    AFFO adjustment for                                                     
     interests in CPA(R)                                                      
     REITs                    11,971        6,982       37,234       10,137 
    Proportionate share                                                     
     of adjustments for                                                     
     noncontrolling                                                         
     intereststo arrive                                                     
     at AFFO                    (506)          54         (692)         272 
                         -----------  -----------  -----------  ----------- 
  Total adjustments:          16,631        4,553       58,188      (27,117)
                         -----------  -----------  -----------  ----------- 
AFFO - Real Estate                                                          
 Ownership               $    64,705  $    28,207  $   159,511  $   102,748 
                         ===========  ===========  ===========  =========== 
                                                                            
Investment Management                                                       
Net income from                                                             
 investment management                                                      
 attributable to W. P.                                                      
 Carey (a)               $     9,971  $     3,705  $    17,237  $    52,799 
                         -----------  -----------  -----------  ----------- 
FFO - as defined by                                                         
 NAREIT                        9,971        3,705       17,237       52,799 
                         -----------  -----------  -----------  ----------- 
  Adjustments:                                                              
    Amortization,                             
                              
     deferred taxes and                                                     
     non-cash charges            226       (1,256)         961        3,791 
    Stock based                                                             
     compensation              6,281        4,633       25,841       17,496 
    Deferred tax expense      (2,625)         (80)     (24,055)      12,019 
    Realized gains on                                                       
     foreign currency,                                                      
     derivatives and                                                        
     other (d)                   (55)           -          (61)           - 
    Amortization of                                                         
     deferred financing                                                     
     costs (d)                   318            -        1,197            - 
                         -----------  -----------  -----------  ----------- 
  Total Adjustments            4,145        3,297        3,883       33,306 
                         -----------  -----------  -----------  ----------- 
AFFO - Investment                                                           
 Management              $    14,116  $     7,002  $    21,120  $    86,105 
                         ===========  ===========  ===========  =========== 
                                                                            
Total Company                                                               
FFO - as defined by                                                         
 NAREIT                  $    58,045  $    27,539  $   118,560  $   182,664 
                         ===========  ===========  ===========  =========== 
FFO - as defined by                                                         
 NAREIT per share                                                           
 (diluted)               $      0.84  $      0.68  $      2.47  $      4.56 
                         ===========  ===========  ===========  =========== 
AFFO                     $    78,821  $    35,209  $   180,631  $   188,853 
                         ===========  ===========  ===========  =========== 
AFFO per share (diluted) $      1.13  $      0.88  $      3.76  $      4.71 
                         ===========  ===========  ===========  =========== 
Diluted weighted average                                                    
 shares outstanding       69,505,871   40,152,444   48,078,474   40,098,095 
                         ===========  ===========  ===========  =========== 
                                                                            
(a) Effective April 1, 2012, we include cash distributions and deferred     
    revenue received and earned from the operating partnerships of CPA(R):16 -
    Global, CPA(R):17 - Global and CWI in our Real Estate Ownership segment.  
    Results of operations for the prior year periods have been reclassified 
    to conform to the current period presentation.                          
(b) Gain on change in control of interests for the year ended December 31,  
    2011 represents gain recognized on purchase of the remaining interests  
    in two investments from CPA(R):14, which we had previously accounted for  
    under the equity method. In connection with purchasing these properties,
    we recognized a net gain of $27.9 million during the year ended December
    31, 2011 to adjust the carrying value of our existing interests in these
    investments to their estimated fair values.                             
(c) Gain on change in control of interests for the year ended December 31,  
    2012 represents a gain of $14.6 million recognized on our previously    
    held interest in shares of CPA(R):15 common stock, and a gain of $6.1     
    million recognized on the purchase of the remaining interests in five   
    investments from CPA(R):15, which we had previously accounted for under   
 
    the equity method. We recognized a net gain of $20.7 million to adjust  
    the carrying value of our existing interests in these investments to    
    their estimated fair values.                                            
(d) These adjustments are significant and recurring post Merger and were not
    included in the AFFO calculation in 2011.                               
(e) Amount for the year ended December 31, 2012 included $31.7 million of   
    general and administrative expenses and $9.6 million of income tax      
    expenses incurred in connection with the Merger.                        

 
Non-GAAP Financial Disclosure 
FFO is a non-GAAP measure defined by NAREIT. NAREIT defines FFO as
net income or loss (as computed in accordance with GAAP) excluding:
depreciation and amortization expense from real estate assets,
impairment charges on real estate, gains or losses from sales of
depreciated real estate assets and extraordinary items; however, FFO
related to assets held for sale, sold or otherwise transferred and
included in the results of discontinued operations are included.
These adjustments also incorporate the pro rata share of
unconsolidated subsidiaries. FFO is used by management, investors and
analysts to facilitate meaningful comparisons of operating
performance between periods and among our peers. Although NAREIT has
published this definition of FFO, companies often modify this
definition as they seek to provide financial measures that
meaningfully reflect their distinctive operations. 
We modify the NAREIT computation of FFO to include other adjustments
to GAAP net income to adjust for certain non-cash charges such as
amortization of real estate-related intangibles, deferred income tax
benefits and expenses, straight-line rents, stock compensation, gains
or losses from extinguishment of debt and deconsolidation of
subsidiaries and unrealized foreign currency exchange gains and
losses. Additionally, we exclude expenses related to the merger which
are considered non-recurring, and realized gains/losses on foreign
exchange and derivatives, which are not considered fundamental
attributes of our business plan and do not affect our overall
long-term operating performance. We refer to our modified definition
of FFO as AFFO. We exclude these items from GAAP net income as they
are not the primary drivers in our decision making process. Our
assessment of our operations is focused on long-term sustainability
and not on such non-cash items, which may cause short-term
fluctuations in net income but have no impact on cash flows, and we
therefore use AFFO as one measure of our operating performance when
we formulate corporate goals, evaluate the effectiveness of our
strategies, and determine executive compensation.  
We believe that AFFO is a useful supplemental measure for investors
to consider because it will help them to better assess the
sustainability of our operating performance without the potentially
distorting impact of these short-term fluctuations. However, there
are limits on the usefulness of AFFO to investors. For example,
impairment charges and unrealized foreign currency losses that we
exclude may become actual realized losses upon the ultimate
disposition of the properties in the form of lower cash proceeds or
other considerations. 


 
                                                                            
                              W. P. CAREY INC.                              
                                                                            
            Total Adjusted Revenue (Pro rata Basis) (Unaudited)             
                     (in thousands, except percentages)                     
                                                                            
  
                          Three Months Ended            Years Ended       
                               December 31,              December 31,       
                         ------------------------  ------------------------ 
                             2012         2011         2012         2011    
                         -----------  -----------  -----------  ----------- 
Asset management revenue $     9,578  $    15,530  $    56,666  $    66,808 
Structuring revenue (a)       28,779        3,930       48,355       46,831 
                         -----------  -----------  -----------  ----------- 
Investment management                                                       
 revenue                      38,357       19,460      105,021      113,639 
Real estate revenue          103,965       56,582      264,707      197,339 
                         -----------  -----------  -----------  ----------- 
Total Adjusted Revenue   $   142,322  $    76,042  $   369,728  $   310,978 
                         ===========  ===========  ===========  =========== 
                                                                            
Reconciliation of Total                                                     
 Adjusted Revenue                                                           
  Total revenue -- as                                                       
   reported              $   168,058  $    60,971  $   373,995  $   327,784 
  Less: Incentive,                                                          
   termination and                                                          
   subordinated                                                             
   disposition revenue                                                      
   (b)                             -            -            -      (52,515)
  Less: Wholesaling                                                         
   revenue (c)                (8,036)      (2,876)     (19,914)     (11,664)
  Less: Reimbursed costs                                                    
   from affiliates (c)       (39,146)     (15,345)     (98,245)     (64,829)
  Add: Lease revenue -                                                      
   discontinued                                                             
   operations                    738        1,908        3,630        9,452 
  Add: Pro rata share of                                                    
   revenue from equity                                                      
   investments                 9,911        6,601       27,374       28,269 
  Less: Pro rata share                                                      
   of revenue due to                                                        
   noncontrolling                                                           
   interests                 (10,289)        (436)     (11,550)      (2,629)
  Add: Pro rata share of                                                    
   revenue from CPA(R)                                                        
   REITs                      14,838       19,793       72,158       68,833 
  Add: Total                                                                
   distributions of                                                         
   available cash - GP                                                      
   interest                    8,220        7,267       30,009       15,535 
  Less: Pro rata share                                                      
   of other real estate                                                     
   income to                                                                
   noncontrolling                                                           
   interests                  (1,972)      (1,841)      (7,729)      (7,258)
                         -----------  -----------  -----------  ----------- 
Total Adjusted Revenue   $   142,322  $    76,042  $   369,728  $   310,978 
                         ===========  ==
=========  ===========  =========== 
                                                                            
Reconciliation of Real                                                      
 Estate Revenue                                                             
  Lease revenue - as                                                        
   reported              $    74,970  $    17,474  $   124,503  $    62,638 
  Lease revenue -                                                           
   discontinued                                                             
   operations                    738        1,908        3,630        9,452 
                         -----------  -----------  -----------  ----------- 
  Total consolidated                                                        
   lease revenue              75,708       19,382      128,133       72,090 
  Add: Pro rata share of                                                    
   revenue from equity                                                      
   investments                 9,911        6,601       27,374       28,269 
  Less: Pro rata share                                                      
   of revenue due to                                                        
   noncontrolling                                                           
   interests                 (10,289)        (436)     (11,550)      (2,629)
                         -----------  -----------  -----------  ----------- 
Total pro rata net lease                                                    
 revenue                      75,330       25,547      143,957       97,730 
                                                                            
Add: Pro rata share of                                                      
 revenues from CPA(R)                                                         
 REITs                                                                      
  CPA(R):14                          -            -            -        4,841 
  CPA(R):15 (d)                      -        4,294       12,726       17,517 
  CPA(R):16 - Global            13,955       14,973       56,362       44,965 
  CPA(R):17 - Global               883          526        3,070        1,510 
                         -----------  -----------  -----------  ----------- 
Total pro rata share of                                                     
 revenues from CPA(R)                                                         
 REITs                        14,838       19,793       72,158       68,833 
Add: share of lease                                                         
 revenue from GP                                                            
 interest                                                                   
  CPA(R):16 - Global             3,825        3,658       15,389        6,157 
  CPA(R):17 - Global             4,395        3,609       14,620        9,378 
                         -----------  -----------  -----------  ----------- 
Total Share of lease                                                        
 revenue from GP                                                            
 Interest                      8,220        7,267       30,009       15,535 
                         -----------  -----------  -----------  ----------- 
Add: Other real estate                                                      
 income (e)                    7,549        5,816       26,312       22,499 
Less: Pro rata share of                                                     
 other real estate                                                          
 income to                                                                  
 noncontrolling                                                             
 interests (f)                (1,972)      (1,841)      (7,729)      (7,258)
                         -----------  -----------  -----------  ----------- 
Total Real Estate                                               
            
 Revenue                 $   103,965  $    56,582  $   264,707  $   197,339 
                         ===========  ===========  ===========  =========== 
                                                                            
(a) We earn structuring revenue on acquisitions structured on behalf of the 
    Managed REITS and expect significant period-to-period variation in such 
    revenue based on changes in investment volume. Investments structured on
    behalf of the Managed REITS totaled approximately $775 million and $139 
    million for the three months ended December 31, 2012 and 2011,          
    respectively, and $1.3 billion and $1.2 billion for the year ended      
    December 31, 2012 and 2011, respectively.                               
(b) In connection with providing a liquidity event for CPA(R):14 stockholders,
    in May 2011, we earned termination revenue of $31.2 million and         
    subordinated disposition revenue of $21.3 million, which we received in 
    shares of CPA(R):14 and cash, respectively. These CPA(R):14 shares were     
    subsequently converted to shares of CPA(R):16 - Global in connection with 
    the CPA(R):14/16 Merger.                                                  
(c) Total adjusted revenue excludes reimbursements of costs received from   
    the Managed REITs as they have no impact on net income. Also excluded is
    wholesaling revenue earned in connection with CPA(R):17 - Global's and    
    CWI's public offerings, which is substantially offset by underwriting   
    costs incurred in connection with the offerings.                        
(d) For the year ended December 31, 2012, represents pro rata lease revenue 
    from CPA(R):15 through September 28, 2012, the date of the Merger.        
(e) Other real estate income generally consists of revenue from Carey       
    Storage Management LLC ("Carey Storage"), a subsidiary that invests in  
    domestic self-storage properties and Livho, Inc., a subsidiary tha
t     
    operates a hotel franchise. Other real estate income also includes lease
    termination payments and other non-rents related revenues from real     
    estate ownership, and as a result, we expect other real estate income to
    fluctuate period to period.                                             
(f) Effective December 31, 2012, we deduct the non-controllable interest of 
    self storage revenues to reflect our pro rata ownership in this segment.
    Prior periods have been revised to reflect this change.                 
                                                                            
                                                                            
                                                                            
                              W. P. CAREY INC.                              
      Selected Investment Management Fees and Distributions (Unaudited)     
                               (in thousands)                               
                                                                            
                                                                            
                               Three Months Ended December 31, 2012         
                      ------------------------------------------------------
                        Asset Management Revenue                            
                      ----------------------------                          
                        Base Asset                   Distributions          
                        Management    Performance    of Available           
                         Revenue        Revenue          Cash         Total 
                      ------------- -------------- ---------------- --------
CPA(R):15               $           - $            - $              - $      -
CPA(R):16 - Global              4,624              -            3,825    8,449
CPA(R):17 - Global              4,696              -            4,395    9,091
CWI/Other                       258              -                -      258
                      ------------- -------------- ---------------- --------
Total                 $       9,578 $            - $          8,220 $ 17,798
                      ============= ============== ================ ========
                                                                            
                               Three Months Ended December 31, 2011         
                      ------------------------------------------------------
                        Asset Management Revenue                            
                      ----------------------------                          
                        Base Asset                   Distributions          
                        Management    Performance    of Available           
                         Revenue        Revenue          Cash         Total 
                      ------------- -------------- ---------------- --------
Total                 $      12,311 $        3,219 $          7,267 $ 22,797
                      ============= ============== ================ ========
                                                                            
 
                                                                            
                                   Years Ended December 31, 2012            
                      ------------------------------------------------------
                        Asset Management Revenue                            
                      ----------------------------                          
                        Base Asset                   Distributions          
                        Management    Performance    of Available           
                         Revenue        Revenue          Cash         Total 
                      ------------- -------------- ---------------- --------
CPA(R):15               $       9,272 $        9,272 $              - $ 18,544
CPA(R):16 - Global             18,553              -           15,389   33,942
CPA(R):17 - Global             18,919              -           14,620   33,539
CWI/Other                       649              -                -      649
                      ------------- -------------- ---------------- --------
Total                 $      47,393 $        9,272 $         30,009 $ 86,674
                      ============= ============== ================ ========
                                                                            
                                   Years Ended December 31, 2011            
                     -------------------------------------------------------
                        Asset Management Revenue                            
                      ----------------------------                          
                        Base Asset                   Distributions          
                        Management    Performance    of Available           
                         Revenue        Revenue          Cash         Total 
                      ------------- -------------- ---------------- --------
Total                 $      46,770 $       20,038 $         15,535 $ 82,343
                      ============= ============== ================ ========

  
COMPANY CONTACT: 
Kristin Brown 
W. P. Carey Inc. 
212-492-8989 
kbrown@wpcarey.com  
PRESS CONTACTS:
Cheryl Sanclemente
W. P. Carey Inc. 
212-492-8995 
csanclemente@wpcarey.com  
Guy Lawrence
Ross & Lawrence
212-308-3333
gblawrence@rosslawpr.com