BioMed Realty Trust Reports Second Quarter 2014 Financial Results

      BioMed Realty Trust Reports Second Quarter 2014 Financial Results  Second Quarter Leasing Volume Exceeds 810,000 SF; FFO of $0.40 per Diluted Share  PR Newswire  SAN DIEGO, Aug. 5, 2014  SAN DIEGO, Aug. 5,2014 /PRNewswire/ --BioMed Realty Trust, Inc. (NYSE: BMR), the leading real estate company focusing on life sciences, today announced financial results for the second quarter ended June 30, 2014.  Second Quarter 2014 Highlights  Financial and Operating Performance    oExecuted 63 leasing transactions during the quarter representing     approximately 812,200 square feet, contributing to an increase in the     operating portfolio leased percentage on a weighted-average basis to 92.0%     at quarter end;   oIncreased same property net operating income on a cash basis by 6.7%     year-over-year;   oSet new company records for total and rental revenues of approximately     $171.2 million and $120.9 million, respectively; and   oGenerated funds from operations (FFO) and core funds from operations     (CFFO) of $0.40 per diluted share and adjusted funds from operations     (AFFO) of $0.32 per diluted share, and reported net income available to     common stockholders for the quarter of approximately $18.6 million, or     $0.10 per diluted share.  Acquisitions and Development    oAdded approximately one million square feet to the company's portfolio     through its fully-leased investment in the 300 George Street and 100     College Street properties adjacent to the Yale School of Medicine in New     Haven, Connecticut;   oInitiated a new, fully-leased build-to-suit investment to comprise     approximately 42,400 square feet of laboratory and office space in the     Cambridge Science Park in Cambridge, United Kingdom. The property is 100%     pre-leased to Takeda Pharmaceutical Company Limited for 16 years;   oCommenced construction of a 121,600 square foot laboratory and office     building at 500 Fairview Avenue in Seattle, Washington;   oEntered into a 99-year ground lease on a 10-acre site in Philadelphia for     future development through a collaboration between Drexel University and     Wexford Science & Technology, a subsidiary of BioMed Realty; and   oReceived an early payoff of the company's investment in the construction     loan for the Fan Pier development project in Boston, Massachusetts,     totaling $199.3 million, reflecting the repayment of $191.2 million in     principal and accrued interest receivable, and prepayment fees of     approximately $8.1 million.  Financing Activity    oRepaid in full the $333.4 million principal amount outstanding on its     mortgage loan secured by the Center for Life Science | Boston, which bore     interest at 7.75% per annum;   oReceived an upgrade on the company's investment grade corporate credit     rating from Standard & Poor's Ratings Services to BBB, after receiving a     positive outlook from Moody's Investors Service in March 2014; and   oCompleted a public offering of $400 million aggregate principal amount of     2.625% Senior Notes due 2019, priced at 99.408% of the principal amount     to yield 2.752% to maturity.  Board Addition    oAppointed Janice L. Sears, former executive at Bank of America, to the     company's Board of Directors.  "Our outstanding operating and financial results in the second quarter and first half of 2014 provide further evidence of the strength of our proven strategy and business model built on a foundation of operating expertise and our lasting, long-term relationships across the broad spectrum of life science organizations," said Alan D. Gold, Chairman and Chief Executive Officer of BioMed Realty. "As we celebrate the ten-year anniversary of our IPO, we continue to see opportunities for BioMed Realty to grow throughout all our markets, led by our dedicated, best-in-class team that possesses a deep understanding of the life science industry and a sustained track record of successfully executing our strategy of supporting the collaboration of academia and private enterprise to develop exciting new technologies and therapies that improve our lives."  Portfolio Update  During the quarter ended June 30,2014, the company executed 63 leasing transactions representing approximately 812,200 square feet, contributing to an operating portfolio leased percentage on a weighted-average basis of 92.0% and a development portfolio pre-leased percentage of 81.6% at quarter end, and comprised of:    o47 new leases totaling approximately 493,200 square feet, highlighted by:         oLeases with Affymetrix, Inc. for a total of approximately 82,800          square feet at two adjacent properties in the Torrey Pines submarket          of San Diego, California, including approximately 53,800 square feet          at 10255 Science Center Drive and approximately 29,000 square feet at          10240 Science Center Drive;        oA lease with Sys-Tech Solutions, Inc. for approximately 50,600 square          feet at the company's One Research Way property in Princeton, New          Jersey;        oA lease with OptiScan Biomedical Corporation totaling approximately          50,400 square feet at the Bridgeview Technology Park II property in          Hayward, California;        oA lease with Intertek USA, Inc. for approximately 46,100 square feet          at the company's Wateridge Circle property in San Diego, California;        oA lease expansion with Acorda Therapeutics, Inc. for approximately          25,400 square feet at the Ardsley Park campus in Ardsley, New York;          and        oA lease expansion with a global healthcare company for 24,900 square          feet at the company's new development at 500 Fairview Avenue in          Seattle, Washington.    o16 lease renewals and extensions totaling approximately 319,000 square     feet, highlighted by a lease extension with a private biotechnology     company for approximately 235,800 square feet, which also included     approximately 26,400 square feet of new additional space, at the Pacific     Research Center in Newark, California.  At June 30,2014, the company's total portfolio comprised approximately 17.2 million rentable square feet, with land supporting an estimated additional 7.5 million square feet of development potential. Second quarter same property net operating income on a cash basis increased 6.7% year-over-year, primarily as a result of sustained leasing success and contractual rent escalations. During the second quarter, the lease at the company's King of Prussia property in Radnor, Pennsylvania reached term, and, as planned, the site is now held for development potential. Had the property remained in the same property pool, same property net operating income on a cash basis would have increased 3.2% year-over-year.  During the second quarter, the company invested in two properties, 300 George Street and 100 College Street, adjacent to the Yale School of Medicine in New Haven, Connecticut. The 300 George Street property is a 519,000 square foot laboratory and office building, which is 98.7% leased and anchored by long-term leases to Yale University and the Yale-New Haven Hospital, with a weighted-average remaining lease term of over eleven years. The 100 College Street property, currently under construction, is a 510,000 square foot laboratory and office building that is pre-leased and anchored by Alexion Pharmaceuticals, Inc. with a weighted-average remaining lease term of over 13 years. The total project investment, upon completion, is expected to be approximately $308 million.  Also during the quarter, the company made an initial $3.9 million investment in a development in the Cambridge Science Park in Cambridge, United Kingdom as a build-to-suit property for Takeda Pharmaceutical Company Limited. Upon completion, the property is expected to comprise approximately 42,400 square feet of laboratory and office space which will be 100% leased to Takeda for 16 years, with a projected total investment of approximately $24.4 million.  In addition, during the second quarter, as a result of a collaboration between Drexel University and Wexford Science & Technology, a subsidiary of BioMed Realty, Drexel University purchased a 14-acre site from the School District of Philadelphia which formerly housed the University City High School, the Charles Drew Elementary School and The Walnut Center. Concurrent with the close of the purchase, Drexel University took title to the underlying land and Wexford entered into a 99-year ground lease for approximately ten acres of the site which provides an estimated 2.3 million square feet of development potential, with a mixed-use plan that includes laboratory and research office, residential, retail and recreational space. The company's initial investment totaled approximately $18.2 million.  During the quarter, the company commenced construction on a 121,600 square foot laboratory and office building at 500 Fairview Avenue in Seattle, Washington. A global healthcare company will initially be leasing approximately 24,900 square feet. The two buildings together, comprising approximately 223,000 square feet of state-of-the-art life science real estate, are being renamed the BioMed Realty Research Center and will serve as an iconic hub for innovation in Seattle's life science community, offering amenities including onsite parking, a fitness center and a conference center.  In connection with an expansion by Acorda Therapeutics completed during the second quarter, the company is expanding its Ardsley Park campus by a total of 47,400 square feet to accommodate the new 25,400 square foot lease. Upon completion of the expansion, the campus will comprise approximately 207,900 square feet that is 89.4% leased.  Kent Griffin, President of BioMed Realty, remarked, "Our exceptionally strong operating results of the second quarter benefited from broad-based leasing success and three strategically important portfolio additions that expand our footprint and create new connection points at cornerstones of scientific innovation – Yale University, University of Pennsylvania, Drexel University, and the University of Cambridge. We enter our second decade as a public company with very strong momentum on all fronts, thanks to the vitality of the life science industry, our team's steady execution of our business model, and the sustained support of our tenant relationships and business partners."  Subsequent to the end of the quarter, the company and Bristol-Myers Squibb entered into a ten year lease for approximately 61,000 square feet of additional laboratory space at the company's Woodside Technology Park life science campus in Redwood City, California, and extended its existing lease at the campus for 133,000 square feet by an additional 30 months. In addition, the company entered into a lease termination with the tenant for 180,000 square feet at its 50 Hampshire building in Cambridge, Massachusetts. The original lease would have reached term in December 2019. Under the terms of the agreement, the tenant will pay a termination fee of $8.5 million and vacate the space at the end of March 2015.  Second Quarter 2014 Financial Results  Rental revenues for the second quarter were approximately $120.9 million, compared to approximately $108.1 million for the same period in 2013, an increase of 11.9% and the highest in the company's history. Total revenues for the second quarter were approximately $171.2 million, compared to approximately $159.6 million for the same period in 2013, an increase of 7.2%, also the highest in the company's history. Total revenues for the second quarter 2014 include other revenue of approximately $8.1 million, relating to prepayment fees on the early repayment of the company's investment in the construction loan for the Fan Pier development in Boston, Massachusetts, which contributed approximately $0.03 per diluted share in excess of interest income expected from the loan during the quarter. Total revenues for the second quarter 2013 include other revenue of approximately $17.7 million associated with the termination of leases at the company's Science Center at Oyster Point in South San Francisco, California (which was immediately re-leased to Life Technologies Corporation).  CFFO for the first quarter was $0.40 per diluted share and FFO, calculated in accordance with standards established by NAREIT, was also $0.40 per diluted share for the quarter. AFFO for the quarter was $0.32 per diluted share. The company reported net income available to common stockholders for the quarter of approximately $18.6 million, or $0.10 per diluted share.  Financing Activity  During the second quarter of 2014, the company:    oRepaid in full the $333.4 million principal amount outstanding on its     mortgage loan secured by the Center for Life Science | Boston, which bore     interest at 7.75% per annum;   oReceived an upgrade of its investment grade corporate credit rating from     Standard & Poor's Ratings Services (S&P) from BBB– to BBB, after receiving     a positive outlook from Moody's Investors Service in March 2014; and   oCompleted a public offering of $400 million aggregate principal amount of     2.625% Senior Notes due 2019, which were priced at 99.408% of the     principal amount to yield 2.752% to maturity. Proceeds were used to repay     amounts outstanding under the company's revolving credit facility.  Subsequent to the end of the quarter, certain holders of the company's exchangeable senior notes exercised their exchange rights, pursuant to which the company issued approximately 2.6 million shares of common stock in exchange for approximately $44.5 million principal amount of notes.  Also subsequent to quarter end, the company amended the terms of the loan held through its joint venture with Prudential Real Estate Investors (PREI) and secured by the PREI joint venture's 650 E. Kendall Street property in Cambridge, Massachusetts, extending the loan's maturity date to August 13, 2015 and reducing the applicable credit spread to 205 basis points, with an option to further extend the maturity date to August 13, 2016.  Commenting on the financial results of the second quarter, Greg Lubushkin, Chief Financial Officer of BioMed Realty, remarked, "Exceptional leasing results and our strategic investments continue to drive record rental revenues, robust same property cash NOI growth and steady core funds from operations, all of which are well supported by our strong, flexible balance sheet and industry-leading capital structure. Our proven capital strategy and execution was validated in the second quarter when our investment grade corporate credit rating was upgraded by S&P to BBB and we executed a highly efficient $400 million offering of 2.625% unsecured senior notes. These successes provide the foundation for us to continue to pursue strategic growth opportunities which create value for our stockholders."  Earnings Guidance  The company's updated 2014 guidance for net income per diluted share, FFO per diluted share and CFFO per diluted share are set forth and reconciled below. Projected net income per diluted share and FFO per diluted share (and CFFO per diluted share) are based upon estimated, weighted-average diluted common shares outstanding of approximately 197.8 million and 208.8 million, respectively.                                                                   2014                                                                  (Low - High) Projected net income per diluted share available to common       $0.26 – $0.30 stockholders  Add:  Real estate depreciation and amortization                      $1.26  Noncontrolling interests in operating partnership              $0.01  Less:  Net effect of assumed conversion of exchangeable senior notes  ($0.03) due 2030 Projected FFO per diluted share                                  $1.50 – $1.54 Add: Acquisition costs                                           $0.01 Projected CFFO per diluted share                                 $1.51 – $1.55    The company's 2014 FFO and CFFO estimates reflect the company's year-to-date operating results. In addition, these estimates reflect early repayment of the construction loan in the Fan Pier development project (with previous estimates assuming repayment in the third quarter of 2014) and the 50 Hampshire lease termination executed subsequent to quarter end. The company received prepayment fees on the construction loan of approximately $8.1 million in the second quarter which, as a result of the early payoff, are partially offset, on a full year basis, by a reduction in anticipated interest income from the loan. The impact of the 50 Hampshire lease termination fee, net of related GAAP adjustments, totaled $7.5 million and will be recognized ratably as additional revenue from August 2014 through March 2015, when the lease will terminate. The impact of these two items has the net effect of increasing the company's estimates for 2014 FFO and CFFO by approximately $0.03 per diluted share.  The company continues to target new investment opportunities, including acquisitions and new development projects; however, the company's 2014 FFO and CFFO estimates do not reflect the impact of any future new investments (acquisitions or new development starts) or related financing activity, as the impact of such investments may vary significantly based on the nature of these investments, timing and other factors.   The foregoing estimates are forward-looking and reflect management's view of current and future market conditions, including certain assumptions with respect to leasing activity, rental rates, occupancy levels, interest rates, financings, acquisitions, development and redevelopment and the amount and timing of acquisitions, development and redevelopment activities. The company's actual results may differ materially from these estimates.  Supplemental Information  Supplemental operating and financial data are available in the Investor Relations section of the company's website at www.biomedrealty.com.  Teleconference and Webcast  BioMed Realty will conduct a conference call and webcast at 1:30 p.m. Eastern Time (10:30 a.m. Pacific Time) on Wednesday, August 6, 2014 to discuss the company's financial results and operations for the quarter from the New York Stock Exchange as part of the company's Investor Day 2014 event. The call will be open to all interested investors either through a live audio web cast at the Investor Relations section of the company's web site at www.biomedrealty.com and at www.earnings.com, which will include an online slide presentation to accompany the call, or live by calling (877) 261-8990 (domestic) or (847) 619-6441 (international) with call ID number 37659214. The complete webcast will be archived for 30 days on both web sites. A telephone playback of the conference call will also be available from 4:30 p.m. Eastern Time on Wednesday, August 6, 2014 until midnight Eastern Time on Monday, August 11, 2014 by calling (888) 843-7419 (domestic) or (630) 652-3042 (international) and using access code 37659214#.  About BioMed Realty Trust  BioMed Realty, with its trusted expertise and valuable relationships, delivers optimal real estate solutions for biotechnology and pharmaceutical companies, scientific research institutions, government agencies and other entities involved in the life science industry. BioMed Realty owns or has interests in properties comprising approximately 17.2 million rentable square feet. Additional information is available at www.biomedrealty.com. Follow us on Twitter @biomedrealty.  This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, without limitation: general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, dependence on tenants' financial condition, and competition from other developers, owners and operators of real estate); adverse economic or real estate developments in the life science industry or the company's target markets; risks associated with the availability and terms of financing, the use of debt to fund acquisitions, developments and other investments, and the ability to refinance indebtedness as it comes due; failure to maintain the company's investment grade credit ratings with the ratings agencies; failure to manage effectively the company's growth and expansion into new markets, or to complete or integrate acquisitions and developments successfully; reductions in asset valuations and related impairment charges; risks and uncertainties affecting property development and construction; risks associated with tax credits, grants and other subsidies to fund development activities; risks associated with downturns in foreign, domestic and local economies, changes in interest rates and foreign currency exchange rates, and volatility in the securities markets; ownership of properties outside of the United States that subject the company to different and potentially greater risks than those associated with the company's domestic operations; risks associated with the company's investments in loans, including borrower defaults and potential principal losses; potential liability for uninsured losses and environmental contamination; risks associated with the company's potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended, and possible adverse changes in tax and environmental laws; and risks associated with the company's dependence on key personnel whose continued service is not guaranteed. For a further list and description of such risks and uncertainties, see the reports filed by the company with the Securities and Exchange Commission, including the company's most recent annual report on Form 10-K and quarterly reports on Form 10-Q. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.  (Financial Tables Follow)    BIOMED REALTY TRUST, INC. CONSOLIDATED BALANCE SHEETS (In thousands, except share data)                                                     June 30,      December 31,                                                     2014          2013                                                     (Unaudited) ASSETS Investments in real estate, net                     $ 5,474,648   $ 5,217,902 Investments in unconsolidated partnerships          32,440        32,137 Cash and cash equivalents                           39,004        34,706 Accounts receivable, net                            9,686         8,421 Accrued straight-line rents, net                    181,705       173,779 Deferred leasing costs, net                         236,848       198,067 Other assets                                        185,406       307,589  Total assets                                      $ 6,159,737   $ 5,972,601 LIABILITIES AND EQUITY Mortgage notes payable, net                         $ 456,034     $ 709,324 Exchangeable senior notes                           180,000       180,000 Unsecured senior notes, net                         1,293,246     895,083 Unsecured senior term loan                          764,106       758,786 Unsecured line of credit                            155,000       128,000 Accounts payable, accrued expenses and other        358,958       314,383 liabilities  Total liabilities                                 3,207,344     2,985,576 Equity: Stockholders' equity: Common stock, $.01 par value, 250,000,000 shares authorized, 192,525,766 shares 192,115,002 shares   1,925         1,921 issued and outstanding at June 30, 2014 and December 31, 2013, respectively Additional paid-in capital                          3,557,886     3,554,558 Accumulated other comprehensive loss, net           (24,088)      (32,923) Dividends in excess of earnings                     (642,360)     (583,569)  Total stockholders' equity                        2,893,363     2,939,987 Noncontrolling interests                            59,030        47,038  Total equity                                      2,952,393     2,987,025  Total liabilities and equity                      $ 6,159,737   $ 5,972,601      BIOMED REALTY TRUST, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share data) (Unaudited)                          For the Three Months Ended  For the Six Months Ended                          June 30,                    June 30,                          2014           2013         2014         2013 Revenues: Rental                  $   120,924    $  108,092   $  240,950   $  211,048 Tenant recoveries        40,280         32,494       79,015       65,131 Other revenue            9,957          19,053       20,072       43,911 Total revenues           171,161        159,639      340,037      320,090 Expenses: Rental operations        53,636         41,941       106,159      82,494 Depreciation and         62,736         63,557       125,145      124,320 amortization General and              12,443         10,396       24,385       20,424 administrative Acquisition-related      1,134          2,120        2,384        4,357 expenses Total expenses           129,949        118,014      258,073      231,595 Income from operations   41,212         41,625       81,964       88,495 Equity in net loss of unconsolidated           (10)           (267)        (148)        (585) partnerships Interest expense, net    (23,131)       (26,119)     (51,141)     (52,021) Other expense            1,027          (202)        9,190        (3,392)  Net income           19,098         15,037       39,865       32,497 Net income attributable to noncontrolling        (462)          (234)        (2,396)      (379) interests Net income attributable  18,636         14,803       37,469       32,118 to the company Preferred stock          —              —            —            (2,393) dividends Cost on redemption of    —              —            —            (6,531) preferred stock Net income available to  $   18,636     $  14,803    $  37,469    $  23,194 common stockholders Income from continuing operations per share available to common stockholders: Basic and diluted        $   0.10       $  0.08      $  0.19      $  0.13 earnings per share Weighted-average common shares outstanding: Basic                    191,003,248    186,735,157  190,954,827  173,288,517 Diluted                  196,800,354    190,151,166  196,673,649  176,508,215    BIOMED REALTY TRUST, INC. CONSOLIDATED FUNDS FROM OPERATIONS (In thousands, except share data) (Unaudited)  Our FFO and CFFO available to common shares and partnership and LTIP units and a reconciliation to net income for the three and six months ended June 30, 2014 and 2013 was as follows:                         Three Months Ended            Six Months Ended                         June 30,                      June 30,                         2014            2013          2014            2013 Net income available to $    18,636     $    14,803   $  37,469    $  23,194 the common stockholders Adjustments: Noncontrolling interests in operating  514             263           1,035        416 partnership Depreciation and amortization –          403             367           776          736 unconsolidated partnerships Depreciation and amortization –          62,736          63,557        125,145      124,320 consolidated entities Depreciation and amortization – allocable to            (599)           (164)         (1,040)      (194) noncontrolling interest of consolidated joint ventures FFO available to common shares and units –      $    81,690     $    78,826   $  163,385   $  148,472 basic  Interest expense on exchangeable senior       1,688           1,688       3,375        3,375 notes FFO available to common shares and units –      $    83,378     $    80,514   $  166,760   $  151,847 diluted  Acquisition-related          1,134           2,120       2,384        4,357 expenses CFFO – diluted          $    84,512     $    82,634   $  169,144   $  156,204 FFO per share – diluted $    0.40       $    0.40     $  0.80      $  0.81 CFFO per share –        $    0.40       $    0.41     $  0.81      $  0.83 diluted Weighted-average common shares and units        208,887,941     201,716,873   208,761,935  188,119,664 outstanding – diluted (1)     Our AFFO available to common shares and partnership and LTIP units and a reconciliation of CFFO to AFFO for the three and six months ended June 30, 2014 and 2013 was as follows:                    Three Months Ended               Six Months Ended                    June 30,                         June 30,                    2014              2013           2014          2013 CFFO - diluted     $    84,512            82,634    $  169,144    $  156,204 Adjustments: Recurring capital expenditures and second generation  (21,553)          (12,599)       (29,284)      (22,394) tenant improvements Leasing            (1,929)           (1,985)        (3,839)       (3,565) commissions Non-cash revenue   (1,830)           (821)          (4,752)       2,422 adjustments Non-cash adjustment for     50                —              50            2,825 securities Non-cash debt      3,568             3,059          6,501         6,158 adjustments Non-cash equity    3,729             3,067          7,479         6,078 compensation Cost on redemption —                 —              —             6,531 of preferred stock Depreciation included in general and        757               565            1,497         1,046 administrative expenses Share of non-cash unconsolidated     18                31             36            71 partnership adjustments AFFO available to common shares and  $    67,322            73,951    $  146,832    $  155,376 units AFFO per share –   $    0.32              0.37      $  0.70       $  0.83 diluted Weighted-average common shares and units outstanding  208,887,941       201,716,873    208,761,935   188,119,664 -  diluted (1)      The three and six months ended June 30,2014 include 10,578,132 shares of     common stock potentially issuable pursuant to the exchange feature of the     exchangeable senior notes due 2030 based on the "if converted" method. The     three and six months ended June 30, 2013 include 10,259,496 shares of     common stock potentially issuable pursuant to the exchange feature of the     exchangeable senior notes due 2030 based on the "if converted" method. (1) The three months ended June 30,2014 and 2013 include 1,509,455 and     1,306,211 shares of unvested restricted stock, respectively, which are     considered anti-dilutive for purposes of calculating diluted earnings per     share. The six months ended June 30, 2014 and 2013 include 1,510,154 and     1,351,953 shares of unvested restricted stock, respectively, which are     considered anti-dilutive for purposes of calculating diluted earnings per     share.    We present funds from operations, or FFO, core funds from operations, or CFFO, and adjusted funds from operations, or AFFO, available to common shares and partnership and LTIP units because we consider them important supplemental measures of our operating performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO, CFFO and AFFO when reporting their results.  FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO excludes depreciation and amortization unique to real estate, gains and losses from property dispositions and extraordinary items, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from net income. We compute FFO in accordance with standards established by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. As defined by NAREIT, FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of property, impairment charges on depreciable real estate, real estate related depreciation and amortization (excluding amortization of loan origination costs) and after adjustments for unconsolidated partnerships and joint ventures.  We calculate CFFO by adding acquisition-related expenses to FFO. We calculate AFFO by adding to CFFO: (a) non-cash revenues and expenses, (b) recurring capital expenditures and second generation tenant improvements, and (c) leasing commissions.  Our computation of FFO, CFFO and AFFO may differ from the methodology for calculating FFO, CFFO and AFFO utilized by other equity REITs and, accordingly, may not be comparable to such other REITs. Further, FFO, CFFO and AFFO do not represent cash flow available for management's discretionary use because of needed capital replacement or expansion, debt service obligations, or other commitments and uncertainties. FFO, CFFO and AFFO should not be considered as an alternative to net income (loss) (computed in accordance with GAAP) as an indicator of our financial performance or to cash flow from operating activities (computed in accordance with GAAP) as an indicator of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends or make distributions. FFO, CFFO and AFFO should be considered only as supplements to net income computed in accordance with GAAP as measures of our operations.  SOURCE BioMed Realty Trust, Inc.  Website: http://www.biomedrealty.com Contact: Rick Howe, Senior Director, Corporate Communications, 858.207.5859, richard.howe@biomedrealty.com  
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