2 0 1 2
A n n uAl R e p oRt
Corporate profile
Ramco-Gershenson Properties Trust (NYSE:RPT) is a fully integrated, self-administered,
publicly-traded real estate investment trust (REIT) based in Farmington Hills, Michigan. The
Company’s business is the ownership and management of multi-anchor shopping centers in
strategic, quality of life markets throughout the Eastern, Midwestern, and Central United States.
At December 31, 2012, the Company had ownership interests in and managed a portfolio of
78 shopping centers and one office building with approximately 15.0 million square feet of
gross leasable area owned by the Company or its joint ventures. The properties are located in
Michigan, Florida, Ohio, Georgia, Missouri, Colorado, Wisconsin, Illinois, Indiana, New Jersey,
Virginia, Maryland, and Tennessee. At December 31, 2012, the Company’s core operating
portfolio was 94.6% leased.
100
80
60
40
20
0
Dear Fellow Shareholders,
I am extremely pleased to report that 2012 was
an outstanding year for Ramco-Gershenson. We
achieved positive across the board operating and
financial results which propelled our Company to a
43% total shareholder return for the year, the highest
of all our shopping center peers and the 12th highest
among all public REITs. These accomplishments
are the result of a three-year strategic business
plan which focused on increasing the quality of
our shopping center portfolio and achieving a
sound capital structure with the financial flexibility to
realize upon potential growth initiatives. Our actions
included acquiring high-quality, multi-anchored
shopping centers in metropolitan markets while
simultaneously selling non-core properties. We also
concentrated on driving operating performance by
aggressively targeting creditworthy, national retailers
to fill vacancies and replace underperforming
tenants. In addition, we worked to achieve a
fortress balance sheet with low leverage and an
unsecured debt structure. All of these initiatives
were undertaken to maximize long-term, superior
returns for our shareholders.
Successful Execution of Our Plan
In 2012, our external investments included the
acquisition of approximately $150 million in multi-
anchored, market dominant shopping centers. Our
shopping center acquisitions included our entrance
into the state of Colorado with the purchase of Harvest
Junction North and South in the Boulder/Denver
market. These two centers combined encompass
over 336,000 square feet and are anchored by a
number of outstanding national retailers including
Dick’s Sporting Goods, Bed, Bath & Beyond,
Dennis Gershenson
President and CEO
SMALL TENANT LEASED OCCUPANCY
89.0%
88.0%
87.0%
86.0%
85.0%
84.0%
83.0%
82.0%
87.9%
87.1%
85.8%
84.6%
84.0%
84.1%
3Q’11
4Q’11
1Q’12
2Q’12
3Q’12
4Q’12
INCREASING SAME-CENTER NOI
2 0 1 2 A N N UA L R E P O RT 1
Joint Venture Properties
Consolidated Properties
4%
3%
2%
1%
0%
-1%
-2%
-3%
-4%
95.0%
94.0%
92.0%
91.0%
90.0%
3.3%
1.4%
-1.6%
-3.5%
2009
2010
2011
2012
CORE PORTFOLIO LEASED OCCUPANCY
94.4%
94.6%
93.7%
93.5%
93.2%
93.0%
92.8%
3Q’11
4Q’11
1Q’12
2Q’12
3Q’12
4Q’12
89.0%88.0%87.0%86.0%85.0%84.0%83.0%82.0%3Q’114Q’111Q’122Q’123Q’124Q’1284.0%84.1%84.6%85.8%87.1%87.9%Joint Venture PropertiesConsolidated PropertiesSMALL TENANT LEASED OCCUPANCY4%3%2%1%0%-1%-2%-3%-4%2009201020112012-3.5%-1.6%1.4%3.3%INCREASING SAME-CENTER NOI 95.0%94.0%93.0%92.0%91.0%90.0%3Q’114Q’111Q’122Q’123Q’124Q’1292.8%93.5%93.2%93.7%94.4%94.6%CORE PORTFOLIO LEASED OCCUPANCY020406080100 2012 was an
outstanding year for
Ramco-Gershenson.
We achieved positive
across the board
operating and financial
results which propelled
our Company to a 43%
total shareholder return
for the year.
100
80
60
40
20
Pictured opposite page, top: The Plaza at Delray, Delray Beach, FL;
bottom left: Tel-Twelve, Southfield, MI;
0
bottom right: Hunter’s Square, Farmington Hills, MI
Marshalls, Ross Dress for Less, Michaels, and DSW.
We also broadened our presence in St. Louis,
Missouri and Milwaukee, Wisconsin, increasing our
concentration in these vibrant retail markets. As part
of our focus on improving the quality of our shopping
center portfolio, we sold or conveyed approximately
$79 million of non-core properties including our
least productive assets. Our future acquisition plans
include the purchase of market dominant shopping
centers which are the destination of choice for the
consumer and the must-have locations for national
retailers. We will also continue to sell non-core
properties consistent with our plan to constantly
improve the quality of our markets and our real estate.
Our investments last year also included both adding
value to newly acquired shopping centers through
the development of land purchased adjacent to
these properties as well as capitalizing on value-
add redevelopment opportunities in our existing
shopping center portfolio. In 2012, our most notable
development projects included the commencement
of the Parkway Shops, a $20 million development
adjacent to our one million square foot River City
Marketplace in Jacksonville, Florida. Additionally,
we facilitated the development of Phase II of The
Shoppes at Fox River, in Milwaukee, which includes,
T.J. Maxx, Charming Charlie, ULTA Beauty, and
Rue 21. We still own over 12 acres of land available
this
for additional expansion/development at
property. Management is presently working with
two 50,000 square foot national retailers desirous of
locating at this center. Also in 2012, we commenced
the expansion of our recently acquired Town &
Country Crossing shopping center in St. Louis with
the development of a 9,000 square foot Coopers
Hawk Winery & Restaurant.
SMALL TENANT LEASED OCCUPANCY
89.0%
88.0%
87.0%
86.0%
85.0%
84.0%
83.0%
82.0%
87.9%
87.1%
85.8%
84.6%
84.0%
84.1%
3Q’11
4Q’11
1Q’12
2Q’12
3Q’12
4Q’12
INCREASING SAME-CENTER NOI
4%
3%
2%
1%
0%
-1%
-2%
-3%
-4%
3.3%
1.4%
-1.6%
-3.5%
2009
2010
2011
2012
Joint Venture Properties
Consolidated Properties
95.0%
CORE PORTFOLIO LEASED OCCUPANCY
Our most significant value-add redevelopments last
year included the construction of a new 35,000
square foot Whole Foods Market at The Shops on
Lane Avenue in Upper Arlington (Columbus), Ohio
as well as the addition of a 45,000 square foot L.A.
Fitness at Peachtree Hill in Duluth (Atlanta), Georgia.
During the year, we substantially reduced our
anchor vacancy to only five spaces while mitigating
risk to those categories and tenants who were most
vulnerable to internet sales, replacing them with
best-in-class retailers, including T.J. Maxx, Marshall’s,
Bed, Bath & Beyond, and Ross Dress for Less.
92.0%
93.0%
94.0%
94.6%
93.5%
92.8%
93.2%
93.7%
94.4%
91.0%
4Q’11
3Q’11
3Q’12
1Q’12
4Q’12
2Q’12
90.0%
Our success in improving our shopping center
portfolio through acquisitions, (re)development,
and asset management was the driver of ever-
increasing operating metrics for the year. In 2012,
we were able to improve occupancy in our core
shopping center portfolio to 94.6%, highlighted by
a 380 basis point increase in small shop leased
occupancy.
lease
agreements, encompassing 1.8 million square feet
total, we executed 330
In
2 0 1 2 A N N UA L R E P O RT 3
89.0%88.0%87.0%86.0%85.0%84.0%83.0%82.0%3Q’114Q’111Q’122Q’123Q’124Q’1284.0%84.1%84.6%85.8%87.1%87.9%Joint Venture PropertiesConsolidated PropertiesSMALL TENANT LEASED OCCUPANCY4%3%2%1%0%-1%-2%-3%-4%2009201020112012-3.5%-1.6%1.4%3.3%INCREASING SAME-CENTER NOI 95.0%94.0%93.0%92.0%91.0%90.0%3Q’114Q’111Q’122Q’123Q’124Q’1292.8%93.5%93.2%93.7%94.4%94.6%CORE PORTFOLIO LEASED OCCUPANCY020406080100 100
80
60
40
20
0
SMALL TENANT LEASED OCCUPANCY
87.9%
87.1%
85.8%
84.6%
84.0%
84.1%
3Q’11
4Q’11
1Q’12
2Q’12
3Q’12
4Q’12
INCREASING SAME-CENTER NOI
3.3%
1.4%
89.0%
88.0%
87.0%
86.0%
85.0%
84.0%
83.0%
82.0%
4%
3%
2%
1%
0%
-1%
-2%
-3%
-4%
-1.6%
-3.5%
2009
2010
2011
2012
CORE PORTFOLIO LEASED OCCUPANCY
95.0%
94.0%
93.0%
92.8%
93.7%
93.5%
93.2%
94.4%
94.6%
92.0%
91.0%
90.0%
3Q’11
4Q’11
1Q’12
2Q’12
3Q’12
4Q’12
at positive leasing spreads for both new leases and
renewals. These results contributed to our same
center net operating income (NOI) growth of 3.3%.
Our ability to consistently add leading national
retailers to our properties coupled with our success
in driving higher rental rates are indicators of a
high-quality shopping center portfolio positioned
to deliver consistent, sustainable property level
income growth for the foreseeable future.
in our approach
Complementing our progress of increasing income
through acquisitions and operations, we remained
disciplined
to retaining and
promoting a sound capital structure. During 2012,
we closed on a new and expanded $360 million
unsecured credit facility, grew our unencumbered
asset base to $751.1 million, and raised approximately
$120 million in common equity. Our debt metrics
highlight our commitment to a strong balance sheet
with net debt to EBITDA of 6.6x as compared to
7.7x at the end of 2011 and a fixed charge coverage
ratio of 2.2x last year verses 1.6x the year before.
4 R A M C O G E R S H E N S O N P RO P E RT I E S T RU S T
Joint Venture Properties
Consolidated Properties
Pictured opposite page, top left: Crossroads Centre, Rossford, OH;
top right: River City Marketplace, Jacksonville, FL;
bottom: River Crossing Centre, New Port Richey, FL
These statistics position our Company alongside
the average of the strongest accredited peers in the
REIT shopping center industry.
Our Next Chapter
We look forward to 2013 as a year with great
promise. The success we achieved in 2012 provides
a solid foundation for Ramco-Gershenson’s future
and bolsters our commitment to creating value for
our shareholders. Our plans for this year include:
• The continued refinement in the quality of our
markets and assets through an accelerated
acquisition and disposition program.
improvement
• Additional significant
the
credit quality of our tenant roster and the
accompanying increase in occupancy in our
smaller tenant spaces.
in
• Undertaking a number of value-added rede-
velopments and selective developments in
response to specific market trends.
• Continuing our focus on generating an even
stronger balance sheet as we grow the Company.
On behalf of our Board of Trustees and everyone at
Ramco-Gershenson, thank you for your unwavering
support. We
to continuing our
forward
partnership for years to come.
look
Sincerely,
Dennis Gershenson
President and CEO
89.0%88.0%87.0%86.0%85.0%84.0%83.0%82.0%3Q’114Q’111Q’122Q’123Q’124Q’1284.0%84.1%84.6%85.8%87.1%87.9%Joint Venture PropertiesConsolidated PropertiesSMALL TENANT LEASED OCCUPANCY4%3%2%1%0%-1%-2%-3%-4%2009201020112012-3.5%-1.6%1.4%3.3%INCREASING SAME-CENTER NOI 95.0%94.0%93.0%92.0%91.0%90.0%3Q’114Q’111Q’122Q’123Q’124Q’1292.8%93.5%93.2%93.7%94.4%94.6%CORE PORTFOLIO LEASED OCCUPANCY020406080100 Our ability to consistently add leading
national retailers to our properties
coupled with our success in driving
higher rental rates are indicators of a
high-quality shopping center portfolio
positioned to deliver consistent,
sustainable property level income
growth for the foreseeable future.
UNENCUMBERED REAL ESTATE
TO TOTAL REAL ESTATE
UNENCUMBERED REAL ESTATE
TO TOTAL REAL ESTATE
Selected Financial Highlights
PORTFOLIO MIX
PORTFOLIO MIX
(dollars in thousands, except per share amounts)
10.5%
Years Ended December 31
Total Revenues
Net Income Available
10.5%
to Common Shareholders
89.5%
Funds from Operations (FFO) Available
to Common Shareholders*
89.5%
Per Share
Funds from Operations Available to
2012
$ 128,738
2011
$ 117,574
2010
$ 107,636
4.2%
6.8%
2009
$108,758
2008
$ 117,757
4.2%
6.8%
$ (46) $
(32,002)
$ (20,148)
$ 13,720
$ 23,501
45.1%
45.1%
$ 49,025
$ 41,727
$ 40,138
$ 45,263
43.9%
$ 47,362
43.9%
Common Shareholders, Diluted Share
Cash Distributions Declared
$1.04
$0.66
$1.01
$0.65
$1.05
$0.65
$1.80
$0.79
$2.21
$1.62
Unencumbered Assets
Encumbered Assets
UNENCUMBERED REAL ESTATE
TO TOTAL REAL ESTATE
CAPITAL STRUCTURE
(dollars in millions)
Unencumbered Assets
Total Assets
Mortgages and Notes Payable
Encumbered Assets
Total Liabilities
Shareholders’ Equity
Number of Properties
CAPITAL STRUCTURE
(dollars in millions)
*FFO excludes certain one-time non-cash items.
$1,165,291
$ 541,281
$ 605,459
$ 529,783
79
$1,048,823
$ 518,512
$ 567,649
$ 449,075
84
$1,052,829
$ 571,694
$ 613,463
$ 402,273
90
PORTFOLIO MIX
8.1%
8.1%
2.1%
0.4%
3.0%
3.4%
4.5%
5.6%
Mortgage Loans (due various dates)
Mortgage Loans (due various dates)
6.8%
4.2%
Term Loan (due April 16)
Term Loan (due September 18)
Term Loan (due April 16)
Term Loan (due September 18)
TOTAL ASSETS
UNDER MANAGEMENT
(dollars in millions)
Unsecured Term Loan (due July 17)
Unsecured Term Loan (due July 17)
2500
45.1%
Unsecured Revolving Credit Facility (due July 16)
Unsecured Revolving Credit Facility (due July 16)
Capital Lease Obligation
Capital Lease Obligation
2000
43.9%
Jr. Subordinated Note
Jr. Subordinated Note
21.9%
51.0%
Convertible Preferred Stock
51.0%
1500
Convertible Preferred Stock
$997,957
$552,836
$591,392
$367,228
88
$1,014,526
$ 663,189
$ 701,488
$ 273,714
89
DIVERSIFIED TENANT MIX
DIVERSIFIED TENANT MIX
21.4%
TOTAL ASSETS
UNDER MANAGEMENT
(dollars in millions)
21.4%
13.9%
13.9%
64.7%
64.7%
$2,100
$1,700
$1,300
2.1%
0.4%
3.0%
3.4%
4.5%
5.6%
21.9%
10.5%
89.5%
Unencumbered Assets
Encumbered Assets
CAPITAL STRUCTURE
(dollars in millions)
8.1%
2.1%
0.4%
3.0%
3.4%
4.5%
5.6%
21.9%
CAPITAL
STRUCTURE
Common Equity
(Market Capitalization)
(dollars
in millions)
51.0%
$ 681.7
Mortgage Loans (due various dates) 21.9% $ 293.2
Term Loan (due April 16)
5.6% $ 75.0
Term Loan (due September 18)
4.5% $ 60.0
Unsecured Term Loan (due July 17)
Unsecured Revolving Credit Facility
(due July 16)
Capital Lease Obligation
Jr. Subordinated Note
Convertible Preferred Stock
3.0%
$ 40.0
0.4% $ 6.0
2.1% $ 28.1
8.1% $ 107.9
TOTAL ASSETS
UNDER MANAGEMENT
(dollars in millions)
TOTAL ASSETS
100.0% $1,336.9
UNDER MANAGEMENT
(dollars in millions)
Mortgage Loans (due various dates)
Term Loan (due April 16)
Total
Term Loan (due September 18)
Unsecured Term Loan (due July 17)
2500
2500
Unsecured Revolving Credit Facility (due July 16)
2000
2000
Capital Lease Obligation
Jr. Subordinated Note
Convertible Preferred Stock
51.0%
Ramco-Gershenson owns interests
1500
1500
in and manages over $2.0 billion
1000
PORTFOLIO
MIX
500
Multi-Anchored Shopping Center
with a Supermarket
Multi-Anchored Shopping Center
Supermarket Only Anchored
0
Shopping Center
Single Anchor Center
DIVERSIFIED TENANT MIX
6.8%
4.2%
Percent of
Annualized
Rents
45.1%
43.9%
$900
DIVERSIFIED
TENANT MIX
National
$500
Regional
Local
$100
Total
Percent of
Annualized
Rents
64.7%
13.9%
21.4%
2008
2009
2010
2011
2012
100.0%
Joint Venture Properties
Wholly Owned Properties
3.4% $ 45.0
Total
100.0%
TOTAL ASSETS
TOTAL ASSETS
UNDER MANAGEMENT
TOTAL ASSETS
UNDER MANAGEMENT
TOTAL ASSETS UNDER MANAGEMENT
UNDER MANAGEMENT
21.4%
(dollars in millions)
(dollars in millions)
(dollars in millions)
(dollars in millions)
TOTAL ASSETS
UNDER MANAGEMENT
(dollars in millions)
TOTAL REVENUES
TOTAL REVENUES UNDER MANAGEMENT
UNDER MANAGEMENT
(dollars in millions)
(dollars in millions)
$2,100
2500
250000
$2,100
$1,700
2000
200000
$1,700
$1,300
1500
150000
$1,300
13.9%
64.7%
$2,100
$245
$1,700
$210
$1,300
$175
$140
$900
$105
1000
in high-quality shopping center
1000
1000
$900
100000
$900
assets producing approximately
500
500
500
$500
50000
$500
$212.0 million in revenues.
0
0
$100
0
$100
0
2008
2009
2008
2010
2009
2011
2010
2012
2011
2012
Joint Venture Properties
Joint Venture Properties
Wholly Owned Properties
Wholly Owned Properties
6 R A M C O G E R S H E N S O N P RO P E RT I E S T RU S T
TOTAL REVENUES
UNDER MANAGEMENT
(dollars in millions)
TOTAL REVENUES
UNDER MANAGEMENT
(dollars in millions)
250000
250000
200000
200000
150000
150000
100000
100000
50000
50000
0
0
250000
$245
$245
$210
$210
200000
$175
$175
150000
$140
$140
100000
$105
$105
50000
$70
$35
0
$0
$70
$35
$0
2008
$70
$35
2008
$0
2009
2008
2010
2009
2011
2010
2012
2011
2012
Joint Venture Properties
Wholly Owned Properties
TOTAL REVENUES
UNDER MANAGEMENT
(dollars in millions)
$500
$100
$245
$210
$175
$140
$105
$70
$35
$0
2009
2008
2010
2009
2011
2010
2012
2011
2012
2008
2009
2010
2011
2012
$2,100$1,700$1,300$900$500$10020082009201020112012TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL REVENUESUNDER MANAGEMENT(dollars in millions)05001000150020002500050000100000150000200000250000$245$210$175$140$105$70$35$020082009201020112012Joint Venture PropertiesWholly Owned Properties$2,100$1,700$1,300$900$500$10020082009201020112012TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL REVENUESUNDER MANAGEMENT(dollars in millions)05001000150020002500050000100000150000200000250000$245$210$175$140$105$70$35$020082009201020112012Joint Venture PropertiesWholly Owned Properties$2,100$1,700$1,300$900$500$10020082009201020112012TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL REVENUESUNDER MANAGEMENT(dollars in millions)05001000150020002500050000100000150000200000250000$245$210$175$140$105$70$35$020082009201020112012Joint Venture PropertiesWholly Owned Properties$2,100$1,700$1,300$900$500$10020082009201020112012TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL ASSETSUNDER MANAGEMENT(dollars in millions)TOTAL REVENUESUNDER MANAGEMENT(dollars in millions)05001000150020002500050000100000150000200000250000$245$210$175$140$105$70$35$020082009201020112012Joint Venture PropertiesWholly Owned Properties
5
4
3
10
79 Properties.
13 States.
10 Major Metropolitan Markets.
15 Million Square Feet.
1
9
6
2
7
8
6 R A M C O G E R S H E N S O N P RO P E RT I E S T RU S T
2 0 1 2 A N N UA L R E P O RT 7
1. Southeast Michigan, West Oaks I
2. Southeast Florida, Vista Plaza
3. Chicago, Illinois, Rolling Meadows
4. St. Louis, Missouri, Town & Country Crossing
5. Denver/Boulder, Colorado, Harvest Junction North
6. Jacksonville, Florida, River City Marketplace
7. Milwaukee, Wisconsin, The Shoppes at Fox River
8. Tampa/Sarasota, Florida, Cypress Point
9. Columbus, Ohio, The Shops on Lane Avenue
10. Atlanta, Georgia, Peachtree Hill
Corporate Information
EXECUTIVE OFFICERS:
Dennis Gershenson
President and CEO
Gregory R. Andrews
Chief Financial Officer,
Secretary
Fred A. Zantello
Executive Vice President,
Assistant Secretary
Catherine Clark
Senior Vice President
Acquisitions
Michael J. Sullivan
Senior Vice President
Asset Management
Matthew L. Ostrower
Managing Director
Morgan Stanley
Audit Committee–
Financial Expert and Member
Nominating and Governance
Committee–Member
Joel M. Pashcow
Managing Member
Nassau Capital LLC
Executive Committee–Chairman
Nominating and Governance
Committee–Member
Mark K. Rosenfeld
Chairman and CEO
Wilherst Developers, Inc.
Audit Committee–
Financial Expert and Chairman
Michael A. Ward
Private Investor
Executive Committee–Member
Nominating and Governance
Committee–Member
Compensation Committee–Member
Shareholder Information
Current and prospective
Ramco–Gershenson investors can
receive a copy of the Company’s
proxy statement, earnings announce-
ments as well as quarterly and annual
reports via the corporate web site,
www.rgpt.com or by contacting:
Dawn L. Hendershot
Director of Investor Relations
31500 Northwestern Highway
Suite 300
Farmington Hills, MI 48334
(248) 592-6202
dhendershot@rgpt.com
Member
National Association of Real Estate
Investment Trusts, Inc.
International Council of
Shopping Centers
Certifications
On July 2, 2012, the Company
submitted the Annual CEO Certification to
the NYSE, pursuant to Section 303A.12
of the NYSE’s listing standards, whereby
our CEO certified that he is not aware of
any violation by the Trust of the NYSE’s
corporate governance listing standards
as of the date of the certification. In addi-
tion, we have filed with the Securities and
Exchange Commission, as exhibits to our
Quarterly Reports on Form 10-Q for the
quarters ended March 31, June 30 and
September 30, 2012, and our Annual
Report on Form 10-K for the year ended
December 31, 2012, certifications by our
CEO and CFO in accordance with Sec-
tions 302 and 906 of the Sarbanes-Oxley
Act of 2002.
BOARD OF TRUSTEES:
Stephen R. Blank, Chairman
Senior Fellow, Finance
Urban Land Institute
Audit Committee–
Financial Expert and Member
Compensation Committee–Member
Nominating and Governance
Committee–Chairman
Dennis Gershenson
President and CEO
Ramco–Gershenson Properties Trust
Executive Committee–Member
Arthur Goldberg
Managing Director
Corporate Solutions Group LLC
Audit Committee–
Financial Expert and Member
Compensation Committee–Chairman
Robert A. Meister
Vice Chairman, Emeritus
Aon Group, Inc.
Compensation Committee-Member
Nominating and Governance
Committee–Member
David J. Nettina
President and co-Chief Executive Officer
Career Management, LLC
Audit Committee–Financial Expert
and Member
CORPORATE INFORMATION
Corporate Headquarters
31500 Northwestern Highway
Suite 300
Farmington Hills, MI 48334
Tel: (248) 350-9900
Fax: (248) 350-9925
www.rgpt.com
Stock Exchange Listing
New York Stock Exchange
NYSE: RPT
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Grant Thornton LLP
Southfield, MI
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Honigman Miller Schwartz and
Cohn LLP
Detroit, MI
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Trust Company
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8 R A M C O G E R S H E N S O N P RO P E RT I E S T RU S T
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
Form 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2012
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-10093
RAMCO-GERSHENSON PROPERTIES TRUST
(Exact Name of Registrant as Specified in its Charter)
Maryland
(State or Other Jurisdiction of
Incorporation or Organization)
31500 Northwestern Highway
Farmington Hills, Michigan
(Address of Principal Executive Offices)
13-6908486
(I.R.S. Employer Identification No.)
48334
(Zip Code)
Registrant’s Telephone Number, Including Area Code: 248-350-9900
Securities Registered Pursuant to Section 12(b) of the Act:
Title of Each Class
Common Shares of Beneficial Interest,
$0.01 Par Value Per Share
Name of Each Exchange
On Which Registered
New York Stock Exchange
Securities Registered Pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes [ ] No [X]
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes [X ] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will
not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K. [ X ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See definition of “large accelerated filer,” “accelerated filer" and “smaller reporting company” in Rule 12b-2
of the Exchange Act.
Large Accelerated Filer [ ]
Non-Accelerated Filer [ ] (Do not check if small reporting company)
Accelerated Filer [X]
Small Reporting Company [ ]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
The aggregate market value of the common equity held by non-affiliates of the registrant as of the last business day of the
registrant’s most recently completed second fiscal quarter (June 30, 2012) was $567,519,272.
Number of common shares outstanding as of February 15, 2013: 51,078,800
Portions of the registrant’s proxy statement for the annual meeting of shareholders to be held June 4, 2013 are in incorporated
by reference into Part III of this Form 10-K.
DOCUMENT INCORPORATED BY REFERENCE
TABLE OF CONTENTS
Item
PART I
Page
1.
1A.
1B.
2.
3.
4.
Business
Risk Factors
Unresolved Staff Comments
Properties
Legal Proceedings
Mine Safety Disclosures
5.
Market for Registrant’s Common Equity, Related Stockholder Matters and
PART II
6.
7.
7A.
8.
9.
9A.
9B.
10.
11.
12.
13.
14.
15.
Issuer Purchases of Equity Securities
Selected Financial Data
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
PART III
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
Exhibits and Financial Statement Schedule
Consolidated Financial Statements and Notes
PART IV
1
5
12
13
19
19
20
22
23
39
40
40
40
43
43
43
43
43
43
44
F-1
Forward-Looking Statements
This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements represent
our expectations, plans or beliefs concerning future events and may be identified by terminology such as “may,” “will,”
“should,” “believe,” “expect,” “estimate,” “anticipate,” “continue,” “predict” or similar terms. Although the forward-looking
statements made in this document are based on our good-faith beliefs, reasonable assumptions and our best judgment based
upon current information, certain factors could cause actual results to differ materially from those in the forward-looking
statements, including: our success or failure in implementing our business strategy; economic conditions generally and in the
commercial real estate and finance markets specifically; the cost and availability of capital, which depends in part on our asset
quality and our relationships with lenders and other capital providers; our business prospects and outlook; changes in
governmental regulations, tax rates and similar matters; our continuing to qualify as a real estate investment trust (“REIT”); and
other factors discussed elsewhere in this document and our other filings with the Securities and Exchange Commission (the
“SEC”). Given these uncertainties, you should not place undue reliance on any forward-looking statements. Except as required
by law, we assume no obligation to update these forward-looking statements, even if new information becomes available in the
future.
PART I
Item 1. Business
The terms “Company,” “we,” “our” or “us” refer to Ramco-Gershenson Properties Trust, Ramco-Gershenson Properties,
L.P., and/or its subsidiaries, as the context may require.
General
Ramco-Gershenson Properties Trust is a fully integrated, self-administered, publicly-traded equity real estate investment trust
(“REIT”). Our primary business is the ownership and management of shopping centers located in targeted metropolitan
markets predominantly in the Eastern and Midwestern United States. Our property portfolio consists of 52 wholly owned
shopping centers and one office building comprising approximately 10.0 million square feet. In addition, we are co-investor in
and manager of two significant joint ventures that own portfolios of shopping centers. We own 30% of Ramco/Lion Venture
L.P., an entity that owns 15 shopping centers comprising approximately 3.0 million square feet. We own 20% of Ramco 450
Venture LLC, an entity that owns eight shopping centers comprising approximately 1.7 million square feet. We also have
ownership interests in three smaller joint ventures that each own a shopping center. Our joint ventures are reported using
equity method accounting. We earn fees from the joint ventures for managing, leasing, and redeveloping the shopping centers
they own. We also own various parcels of land held for development or for sale, the majority of which are adjacent to certain
of our existing developed properties.
Our predecessor, RPS Realty Trust, a Massachusetts business trust, was formed on June 21, 1988 to be a diversified growth-
oriented REIT. In May 1996, RPS Realty Trust acquired the Ramco-Gershenson interests through a reverse merger, including
substantially all of the shopping centers and retail properties as well as the management company and business operations of
Ramco-Gershenson, Inc. and certain of our affiliates. The resulting trust changed its name to Ramco-Gershenson Properties
Trust and Ramco-Gershenson, Inc.’s officers assumed management responsibility. The trust also changed its operations from a
mortgage REIT to an equity REIT and contributed certain mortgage loans and real estate properties to Atlantic Realty Trust, an
independent, newly formed liquidating REIT. On October 2, 1997, with approval from our shareholders, we changed our state
of organization by terminating the Massachusetts trust and merging into a newly formed Maryland REIT.
We conduct substantially all of our business through our operating partnership, Ramco-Gershenson Properties, L.P. (the
“Operating Partnership”), a Delaware limited partnership. The Operating Partnership, either directly or indirectly through
partnerships or limited liability companies, holds fee title to all owned properties. As general partner of the Operating
Partnership, we have the exclusive power to manage and conduct the business of the Operating Partnership. As of December
31, 2012, we owned approximately 95.4% of the interests in the Operating Partnership. The limited partners are reflected as
noncontrolling interests in our financial statements and are generally individuals or entities that contributed interests in certain
assets or entities to the Operating Partnership in exchange for units of limited partnership interest (“OP Units”). OP units are
generally exchangeable, at the holder’s option, for our common shares on a 1:1 basis or for cash. The form of payment is at our
election.
1
We operate in a manner intended to qualify as a REIT pursuant to the provisions of the Internal Revenue Code of 1986, as
amended (the “Code”). Certain of our operations, including property and asset management, as well as ownership of certain
land parcels, are conducted through taxable REIT subsidiaries, (“TRSs”), which are subject to federal and state income taxes.
Business Objectives, Strategies and Significant Transactions
Our business objective is to own and manage high quality shopping centers that generate cash flow for distribution to our
shareholders and that have the potential for capital appreciation. To achieve this objective, we seek to acquire, develop, or
redevelop shopping centers that meet our investment criteria. We also seek to recycle capital through the sale of land or
shopping centers that we deem to be fully valued or that no longer meet our investment criteria. We use debt to finance our
activities and focus on managing the amount, structure, and terms of our debt to limit the risks inherent in debt financing. From
time to time, we enter into joint venture arrangements where we believe we can benefit by owning a partial interest in shopping
centers and by earning fees for managing the centers for our partners.
We invest in primarily large, multi-anchor shopping centers that include national chain store tenants and market dominant
supermarket tenants selling products that satisfy everyday needs. National chain anchor tenants in our centers include, among
others, TJ Maxx/Marshalls, Bed Bath and Beyond, Home Depot and Kohl’s. Supermarket anchor tenants in our centers
include, among others, Publix Super Market, Whole Foods, Supervalu and Kroger. Our shopping centers are primarily located
in metropolitan markets predominantly in the Eastern and Midwestern regions of the United States, such as Detroit, Fort
Lauderdale-Palm Beach, Jacksonville, Tampa, Atlanta, Chicago and St. Louis.
We also own parcels of developable land. Approximately 25% of our developable land by net book value is available for sale
to end users such as retailers that prefer to own their sites or to developers who seek to develop non-retail uses. The remaining
75% of our land is held for development. The timing of future development will depend on our ability to obtain approvals, pre-
lease our proposed projects, and identify a source of construction financing. At December 31, 2012 we had one development
project under construction with a cost to date of $14.0 and expected remaining costs of $5.6 million.
Operating Strategies and Significant Transactions
Our operating objective is to maximize the risk-adjusted return on invested capital at our shopping centers. We seek to do so
by increasing the property operating income of our centers, controlling our capital expenditures, and monitoring our tenants’
credit risk. Our operating strategies include:
Leasing our shopping centers to increase occupancy, maximize rental income, and attract more creditworthy and
productive retail tenants;
Managing and maintaining our centers to appeal to retail tenants and shoppers while ensuring we garner appropriate
value for our operating expenses and capital expenditures;
Redeveloping our centers to increase leasable area, reconfigure space for creditworthy tenants, and create outparcels;
and
Generating temporary and ancillary income from non-rental agreements to use our parking lots, signage, rooftops, and
other portions of our real estate.
During 2012, for the combined portfolio, including wholly-owned and joint venture properties we:
Executed 138 new leases comprised of approximately 0.7 million square feet at an average base rent of $14.55 per
square foot;
Executed 192 renewal leases comprised of approximately 1.1 million square feet at an average base rent of $11.96 per
square foot;
Reduced the number of vacant anchor spaces (spaces > 19,000 square feet) from eight to five; and
Reduced the number of anchor tenants that were lease obligated but not in occupancy from six to two.
Also, during 2012, we continued our strategy of redeveloping centers on a selective basis. In particular, we completed one joint
venture redevelopment project and have substantially completed a second joint venture redevelopment project for which our
proportionate share of costs for both projects is $1.8 million. We expect to identify new redevelopment projects periodically
that are driven by market demand and generate suitable returns on our investment.
2
Investing Strategies and Significant Transactions
Our investing objective is to generate an attractive risk-adjusted return on capital invested in acquisitions and developments. In
addition, we seek to sell land or shopping centers that we deem to be fully valued or that no longer meet our investment criteria.
We underwrite acquisitions based upon current cash flow, projections of future cash flow, and scenario analyses that take into
account the risks and opportunities of ownership. We underwrite development of new shopping centers on the same basis, but
also take into account the unique risks of entitling land, constructing buildings, and leasing newly built space. Our investing
strategies include:
Acquiring shopping centers that are located in targeted metropolitan markets, anchored by stable and productive
supermarkets, discounters, or national chain stores, surrounded by trade areas with appealing demographic
characteristics, sited with suitable visibility and access, and featuring opportunities to add value through intensive
leasing, management, and/or redevelopment;
Developing our land held for development into income-producing investment property, subject to market demand,
availability of capital and adequate returns on our incremental capital;
Selling non-core shopping centers and redeploying the proceeds into investments that meet our investment criteria;
and
Selling land parcels and using the proceeds to pay down debt or reinvest in our business.
During 2012, we entered Boulder, Colorado, a new market for us, through the acquisition of two high-quality grocery-anchored
shopping centers located in high-income trade areas. We also expanded our holdings in the St. Louis, Missouri market. The
following describes the $150.0 million in wholly-owned acquisition activity for 2012:
Spring Meadows Place II, a 49,644 square foot shopping center adjacent to our Spring Meadows Place, located in
Holland, Ohio for $2.4 million;
The Shoppes at Fox River Phase II, a 47,058 square foot shopping center adjacent to our Shoppes at Fox River
shopping center, as well as 12.25 acres of land located in Waukesha, Wisconsin for $10.4 million;
Southfield Expansion, a 19,410 square foot shopping center adjacent to our Southfield Plaza, located in Southfield,
Michigan for $0.9 million;
The Shoppes of Lakeland, a 183,842 square foot shopping center located in Lakeland, Florida for $28.0 million;
Harvest Junction North and Harvest Junction South, a combined 336,345 square feet, as well as 14 acres of land all
located in Longmont (metropolitan Boulder), Colorado. The total acquisition cost was $71.7 million;
Central Plaza, a 166,431 square foot multi-anchored shopping center in Ballwin (St. Louis), Missouri for $21.6
million; and
Nagawaukee Shopping Center, an 113,617 square foot shopping center in Delafield (greater Milwaukee), Wisconsin
for $15.0 million.
In addition, we sold four wholly-owned income-producing properties and one outparcel for net proceeds to us of $10.3 million.
Specifically, we sold:
Shopping centers in Osprey and Sarasota, Florida for $5.6 million resulting in a $0.1 million gain and generating $5.4
million in net cash proceeds;
A shopping center located in Flint, Michigan for $1.8 million resulting in a $0.1 million gain and generating
approximately $1.3 million in net cash proceeds;
A freestanding single tenant building located in Toledo, Ohio for $1.7 million resulting in a $0.1 million gain and
generating approximately $1.6 million in net cash proceeds; and
One land outparcel located in Roswell, Georgia generating net sales proceeds of $2.0 million and a net gain of $0.1
million.
Financing Strategies and Significant Transactions
Our financing objective is to maintain a strong and flexible balance sheet in order to ensure access to capital at a competitive
cost. In general, we seek to increase our financial flexibility by increasing our pool of unencumbered properties and borrowing
on an unsecured basis. In keeping with our objective, we routinely benchmark our balance sheet on a variety of measures to
our peers in the shopping center sector and to REITs in general. Our financing strategies include:
Capitalizing our business with a modest leverage;
Using primarily fixed-rate debt, staggering our debt maturities, monitoring our liquidity and near-term capital
requirements, and managing the average term of our debt;
3
Maintaining a line of credit to fund operating and investing needs on a short-term basis;
Monitoring compliance with debt covenants and maintaining a regular dialogue with our lenders; and
Financing our investment activities with various forms and sources of capital to reduce reliance on any one source of
capital.
During 2012, we continued to strengthen our capital structure by completing an underwritten public offering of newly issued
common shares and refinancing and expanding our existing credit facility.
Specifically, we completed the following transactions:
Issued 6.325 million shares of common shares of beneficial interest at $12.10 per share. Our total net proceeds, after
deducting expenses, were approximately $73.2 million;
Issued 3.1 million shares of common stock through controlled equity offerings for net proceeds of $38.1 million;
Closed a $360 million unsecured credit facility which amends and restates our prior $250 million facility. The
amended facility is comprised of a $240 million revolving line of credit and a $120 million term loan;
Repaid two wholly owned property mortgages secured by our Coral Creek and The Crossroads shopping centers
totaling $19.6 million; and
Conveyed title to our 77.9% owned Kentwood Towne Centre located in Kentwood, Michigan to the lender in
exchange for release from an $8.5 million non-recourse mortgage obligation.
As of December 31, 2012, our unencumbered assets had a book value of approximately $751.1 million and we had net debt to
total market capitalization of 40.7% as compared to $610.0 million and 51.0%, respectively, as of December 31, 2011. At
December 31, 2012 and 2011 we had $198.8 million and $144.1 million, respectively, available to draw under our unsecured
bank line of credit.
Competition
See page 6 of Item 1A. “Risk Factors” for a description of competitive conditions in our business.
Environmental Matters
See page 10 of Item 1A. “Risk Factors” for a description of environmental risks for our business.
Employment
As of December 31, 2012, we had 109 full-time employees. None of our employees are represented by a collective bargaining
unit. We believe that our relations with our employees are good.
Available Information
All reports we electronically file with, or furnish to, the SEC, including our Annual Report on Form 10-K, Quarterly Reports on
Form 10-Q, Current Reports on Form 8-K and amendments to such reports, are available, free of charge, on our website at
www.rgpt.com, as soon as reasonably practicable after we electronically file such reports with, or furnish those reports to, the
SEC. Our Corporate Governance Guidelines, Code of Business Conduct and Ethics and Board of Trustees’ committee charters
also are available on our website.
Shareholders may request free copies of these documents from:
Ramco-Gershenson Properties Trust
Attention: Investor Relations
31500 Northwestern Highway, Suite 300
Farmington Hills, MI 48334
4
Item 1A. Risk Factors
You should carefully consider each of the risks and uncertainties described below and elsewhere in this Annual Report on Form
10-K, as well as any amendments or updates reflected in subsequent filings with the SEC. We believe these risks and
uncertainties, individually or in the aggregate, could cause our actual results to differ materially from expected and historical
results and could materially and adversely affect our business operations, results of operations and financial condition. Further,
additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our results
and business operations.
Operating Risks
National economic conditions and retail sales trends may adversely affect the performance of our properties.
Demand to lease space in our shopping centers generally fluctuates with the overall economy. Economic downturns often
result in a lower rate of retail sales growth, or even declines in retail sales. In response, retailers that lease space in shopping
centers typically reduce their demand for retail space during such downturns. As a result, economic downturns and unfavorable
retail sales trends may diminish the income, cash flow, and value of our properties. Although the U.S. economy is no longer in
recession, the rate of recovery has been slow.
Our concentration of properties in Michigan and Florida makes us more susceptible to adverse market conditions in these
states.
Our performance depends on the economic conditions in the markets in which we operate. In 2012, our wholly-owned and pro
rata share of joint venture properties located in Michigan and Florida accounted for 40%, and 22%, respectively, of our
annualized base rent. To the extent that market conditions in these or other states in which we operate deteriorate, the
performance or value of our properties may be adversely affected.
Changes in the supply and demand for the type of space we lease to our tenants could affect the income, cash flow, and value of
our properties.
Our shopping centers generally compete for tenants with similar properties located in the same neighborhood, community, or
region. Although we believe we own high quality centers, competing centers may be newer, better located, or have a better
tenant mix. In addition, new centers or retail stores may be developed, increasing the supply of retail space competing with our
centers or taking retail sales from our tenants. Our properties also compete with alternate forms of retailing, including on-line
shopping, home shopping networks, and mail order catalogs. Alternate forms of retailing may reduce the demand for space in
our shopping centers.
As a result, we may not be able to renew leases or attract replacement tenants as leases expire. When we do renew tenants or
attract replacement tenants, the terms of renewals or new leases may be less favorable to us than current lease terms. In order
to lease our vacancies, we often incur costs to reconfigure or modernize our properties to suit the needs of a particular tenant.
Under competitive circumstances, such costs may exceed our budgets. If we are unable to lease vacant space promptly, if the
rental rates upon a renewal or new lease are lower than expected, or if the costs incurred to lease space exceed our expectations,
then the income and cash flow of our properties will decrease.
Our reliance on key tenants for significant portions of our revenues exposes us to increased risk of tenant bankruptcies that
could adversely affect our income and cash flow.
As of December 31, 2012, we received 38.8% of our combined annualized base rents from our top 25 tenants, including our top
two tenants: TJ Maxx/Marshalls (4.6%) and Bed Bath & Beyond (2.3%). No other tenant represented more than 2.0% of our
total annualized base rent. The credit risk posed by our major tenants varies.
If any of our major tenants experiences financial difficulties or files bankruptcy, our operating results could be adversely
affected. Bankruptcy filings by our tenants or lease guarantors generally delay our efforts to collect pre-bankruptcy receivables
and could ultimately preclude full collection of these sums. If a tenant rejects a lease, we would have only a general unsecured
claim for damages, which may be collectible only to the extent that funds are available and only in the same percentage as is
paid to all other holders of unsecured claims. In 2012, no major tenant of ours filed for bankruptcy protection.
5
Our properties generally rely on anchor tenants to attract customers. The loss of anchor tenants may adversely impact the
performance of our properties.
If any of our anchor tenants becomes insolvent, suffers a downturn in business, abandons occupancy, or decides not to renew its
lease, such event may adversely impact the performance of the affected center. An abandonment or lease termination by an
anchor tenant may give other tenants in the same shopping center the right to terminate their leases or pay less rent pursuant to
the terms of their leases. Our leases with anchor tenants may, in certain circumstances, permit them to transfer their leases to
other retailers. The transfer to a new anchor tenant could result in lower customer traffic to the center, which could affect our
other tenants. In addition, a transfer of a lease to a new anchor tenant could give other tenants the right to make reduced rental
payments or to terminate their leases.
We may be restricted from leasing vacant space based on existing exclusivity lease provisions with some of our tenants.
In a number of cases, our leases give a tenant the exclusive right to sell clearly identified types of merchandise or provide
specific types of services at a particular shopping center. In other cases, leases with a tenant may limit the ability of other
tenants to sell similar merchandise or provide similar services to that tenant. When leasing a vacant space, these restrictions
may limit the number and types of prospective tenants suitable for that space. If we are unable to lease space on satisfactory
terms, our operating results would be adversely impacted.
Increases in operating expenses could adversely affect our operating results.
Our operating expenses include, among other items, property taxes, insurance, utilities, repairs, and the maintenance of the
common areas of our shopping centers. We may experience increases in our operating expenses, some or all of which may be
out of our control. Most of our leases require that tenants pay for a share of property taxes, insurance and common area
maintenance costs. However, if any property is not fully occupied or if recovery income from tenants is not sufficient to cover
operating expenses, then we could be required to expend our own funds for operating expenses. In addition, we may be unable
to renew leases or negotiate new leases with terms requiring our tenants to pay all the property tax, insurance, and common area
maintenance costs that tenants currently pay, which could adversely affect our operating results.
If we suffer losses that are uninsured or in excess of our insurance coverage limits, we could lose invested capital and
anticipated profits.
Catastrophic losses, such as losses resulting from wars, acts of terrorism, earthquakes, floods, hurricanes, and tornadoes or
other natural disasters, pollution or environmental matters, generally are either uninsurable or not economically insurable, or
may be subject to insurance coverage limitations, such as large deductibles or co-payments. Although we currently maintain
“all risk” replacement cost insurance for our buildings, rents and personal property, commercial general liability insurance, and
pollution and environmental liability insurance, our insurance coverage may be inadequate if any of the events described above
occurs to, or causes the destruction of, one or more of our properties. Under that scenario, we could lose both our invested
capital and anticipated profits from that property.
Our real estate assets may be subject to additional impairment provisions based on market and economic conditions.
On a periodic basis, we assess whether there are any indicators that the value of our real estate properties and other investments
may be impaired. Under generally accepted accounting principles (“GAAP”) a property’s value is impaired only if the estimate
of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property are less than the
carrying value of the property. In our estimate of cash flows, we consider factors such as expected future operating income,
trends and prospects, the effects of demand, competition and other factors. We are required to make subjective assessments as
to whether there are impairments in the value of our real estate properties and other investments.
No assurance can be given that we will be able to recover the current carrying amount of all of our properties and those of our
unconsolidated joint ventures. There can be no assurance that we will not take charges in the future related to the impairment
of our assets. Any future impairment could have a material adverse effect on our results of operations in the period in which the
charge is taken. We recorded impairment provisions of $4.7 million and $37.4 million in 2012 and 2011, respectively, related
to our real estate properties and other investments. Refer to Note 6 of the notes to the consolidated financial statements for
further information regarding impairment provisions.
6
We do not control all decisions related to the activities of joint ventures in which we are invested, and we may have conflicts of
interest with our joint venture partners.
As of December 31, 2012, we had interests in five unconsolidated joint ventures that collectively own 26 shopping centers.
Although we manage the properties owned by these joint ventures, we do not control the decisions for the joint ventures.
Accordingly, we may not be able to resolve in our favor any issues which arise, or we may have to provide financial or other
inducements to our joint venture partners to obtain such favorable resolution.
Various restrictive provisions and rights govern sales or transfers of interests in our joint ventures. We may be required to
make decisions as to the purchase or sale of interests in our joint ventures at a time that is disadvantageous to us. In addition, a
bankruptcy filing of one of our joint venture partners could adversely affect us because we may make commitments that rely on
our partners to fund capital from time to time. The profitability of shopping centers held in a joint venture could also be
adversely affected by the bankruptcy of one of our joint venture partners if, because of certain provisions of the bankruptcy
laws, we were unable to make important decisions in a timely fashion or became subject to additional liabilities.
We may invest in additional joint ventures, the terms of which may differ from our existing joint ventures. In general, we
would expect to share the rights and obligations to make major decisions regarding the venture with our partners, which would
expose us to the risks identified above.
Our equity investment in each of our unconsolidated joint ventures is subject to impairment testing in the event of certain
triggering events, such a change in market conditions or events at properties held by those joint ventures. If the fair value of
our equity investment is less than our net book value on an other than temporary basis, impairment is required under generally
accepted accounting principles. We recorded impairment provisions of $0.4 million and $9.6 million in 2012 and 2011,
respectively, related to our equity investments in unconsolidated joint ventures. Refer to Note 6 of the notes to the consolidated
financial statements for further information.
Market and economic conditions may impact our partners’ ability to perform in accordance with our real estate joint venture
and partnership agreements resulting in a change in control.
Changes in control of our investments could result from events such as amendments to our real estate joint venture and
partnership agreements, changes in debt guarantees or changes in ownership due to required capital contributions. Any changes
in control will result in the revaluation of our investments to fair value, which could lead to impairment. We are unable to
predict whether, or to what extent, a change in control may result or the impact of adverse market and economic conditions may
have to our partners.
Our redevelopment projects may not yield anticipated returns, which would adversely affect our operating results.
Our redevelopment activities generally call for a capital commitment and project scope greater than that required to lease
vacant space. To the extent a significant amount of construction is required, we are susceptible to risks such as permitting, cost
overruns and timing delays as a result of the lack of availability of materials and labor, the failure of tenants to commit or fulfill
their commitments, weather conditions, and other factors outside of our control. Any substantial unanticipated delays or
expenses could adversely affect the investment returns from these redevelopment projects and adversely impact our operating
results.
Investing Risks
We face competition for the acquisition and development of real estate properties, which may impede our ability to grow our
operations or may increase the cost of these activities.
We compete with many other entities for the acquisition of shopping centers and land suitable for new developments, including
other REITs, private institutional investors and other owner-operators of shopping centers. In particular, larger REITs may
enjoy competitive advantages that result from, among other things, a lower cost of capital. These competitors may increase the
market prices we would have to pay in order to acquire properties. If we are unable to acquire properties that meet our criteria
at prices we deem reasonable, our ability to grow may be adversely affected.
7
Commercial real estate investments are relatively illiquid, which could hamper our ability to dispose of properties that no
longer meet our investment criteria or respond to adverse changes in the performance of our properties.
Because real estate investments are relatively illiquid, our ability to promptly sell one or more properties in our portfolio in
response to changing economic, financial and investment conditions is limited. The real estate market is affected by many
factors, such as general economic conditions, supply and demand, availability of financing, interest rates and other factors that
are beyond our control. We cannot be certain that we will be able to sell any property for the price and other terms we seek, or
that any price or other terms offered by a prospective purchaser would be acceptable to us. We also cannot estimate with
certainty the length of time needed to find a willing purchaser and to complete the sale of a property. We may be required to
expend funds to correct defects or to make improvements before a property can be sold. Factors that impede our ability to
dispose of properties could adversely affect our financial condition and operating results.
We are seeking to develop new properties, an activity that has inherent risks including cost overruns related to entitling land,
improving the site, constructing buildings, and leasing new space.
We are seeking to develop and construct retail properties at several land parcels we own. Our development and construction
activities are subject to the following risks:
The pre-construction phase for a development project typically extends over several years, and the time to obtain
anchor commitments, zoning and regulatory approvals, and financing can vary significantly from project to project;
We may not be able to obtain the necessary zoning or other governmental approvals for a project, or we may
determine that the expected return on a project is not sufficient. If we abandon our development activities with respect
to a particular project, we may incur an impairment loss on our investment;
Construction and other project costs may exceed our original estimates because of increases in material and labor
costs, delays and costs to obtain anchor and other tenant commitments;
We may not be able to obtain financing for construction;
Occupancy rates and rents at a completed project may not meet our projections; and
The time frame required for development, construction and lease-up of these properties means that we may have to
wait years for a significant cash return.
If any of these events occur, our development activities may have an adverse effect on our results of operations, including
additional impairment provisions. We recorded impairment provisions of $1.4 million and $11.5 million in 2012 and 2011,
respectively, related to developable land. For a detailed discussion of development projects, refer to Notes 3 and 6 of the notes
to the consolidated financial statements.
Financing Risks
We have no corporate debt limitations.
Our management and Board of Trustees (“Board”) have discretion to increase the amount of our outstanding debt at any time.
Subject to existing financial covenants, we could become more highly leveraged, resulting in an increase in debt service costs
that could adversely affect our cash flow and the amount available for distribution to our shareholders. If we increase our debt,
we may also increase the risk of default on our debt.
Our debt must be refinanced upon maturity, which makes us reliant on the capital markets on an ongoing basis.
We are not structured in a manner to generate and retain sufficient cash flow from operations to repay our debt at maturity.
Instead, we expect to refinance our debt by raising equity, debt, or other capital prior to the time that it matures. As of
December 31, 2012, we had $547.3 million of outstanding indebtedness, including $6.0 million of capital lease obligations. Of
this, $13.0 million matures in 2013. In addition, our joint ventures had $360.3 million of outstanding indebtedness, of which
our share is $90.3 million. $214.7 million of joint venture debt matures in 2013, of which our share is $52.4 million. The
availability and price of capital can vary significantly. If we seek to refinance maturing debt when capital market conditions
are restrictive, we may find capital scarce, costly, or unavailable. Refinancing debt at a higher cost would affect our operating
results and cash available for distribution. The failure to refinance our debt at maturity would result in default and the exercise
by our lenders of the remedies available to them, including foreclosure and, in the case of recourse debt, liability for unpaid
amounts.
8
Increases in interest rates may affect the cost of our variable-rate borrowings, our ability to refinance maturing debt, and the
cost of any such refinancings.
As of December 31, 2012, we had four interest rate swap agreements in effect for an aggregate notional amount of $135.0
million converting our floating rate corporate debt to fixed rate debt. After accounting for these interest rate swap agreements,
we had $85.0 million of variable rate debt outstanding. Increases in interest rates on our existing indebtedness would increase
our interest expense, which could adversely affect our cash flow and our ability to distribute cash to our shareholders. For
example, if market rates of interest on our variable rate debt outstanding as of December 31, 2012 increased by 1.0%, the
increase in interest expense on our existing variable rate debt would decrease future earnings and cash flows by approximately
$0.9 million annually. Interest rate increases could also constrain our ability to refinance maturing debt because lenders may
reduce their advance rates in order to maintain debt service coverage ratios.
Our mortgage debt exposes us to the risk of loss of property, which could adversely affect our financial condition.
As of December 31, 2012, we had $293.2 million of mortgage debt encumbering our properties. A default on any of our
mortgage debt may result in foreclosure actions by lenders and ultimately our loss of the mortgaged property. We have entered
into mortgage loans which are secured by multiple properties and contain cross-collateralization and cross-default provisions.
Cross-collateralization provisions allow a lender to foreclose on multiple properties in the event that we default under the loan.
Cross-default provisions allow a lender to foreclose on the related property in the event a default is declared under another loan.
For federal income tax purposes, a foreclosure of any of our properties would be treated as a sale of the property for a purchase
price equal to the outstanding balance of the debt secured by the mortgage. If the outstanding balance of the debt secured by
the mortgage exceeds our tax basis in the property, we would recognize taxable income on foreclosure but would not receive
any cash proceeds.
For instance, in June 2012 we conveyed title to our 77.9% owned center in Kentwood, Michigan in exchange for release from
an $8.5 million non-recourse mortgage obligation. The transaction resulted in a non-cash gain on debt extinguishment of
approximately $0.3 million.
Financial covenants may restrict our operating, investing, or financing activities, which may adversely impact our financial
condition and operating results.
The financial covenants contained in our mortgages and debt agreements reduce our flexibility in conducting our operations
and create a risk of default on our debt if we cannot continue to satisfy them. The mortgages on our properties contain
customary negative covenants such as those that limit our ability, without the prior consent of the lender, to further mortgage
the applicable property or to discontinue insurance coverage. In addition, if we breach covenants in our debt agreements, the
lender can declare a default and require us to repay the debt immediately and, if the debt is secured, can ultimately take
possession of the property securing the loan.
Our outstanding line of credit contains customary restrictions, requirements and other limitations on our ability to incur
indebtedness, including limitations on the maximum ratio of total liabilities to assets, the minimum fixed charge coverage, and
the minimum tangible net worth ratio. Our ability to borrow under our line of credit is subject to compliance with these
financial and other covenants. We rely on our ability to borrow under our line of credit to finance acquisition, development,
and redevelopment activities and for working capital. If we are unable to borrow under our line of credit, our financial
condition and results of operations would likely be adversely impacted.
Because we must distribute a substantial portion of our income annually in order to maintain our REIT status, we may not
retain sufficient cash from operations to fund our investing needs.
As a REIT, we are subject to annual distribution requirements under the Code. In general, we must distribute at least 90% of
our REIT taxable income annually, excluding net capital gains, to our shareholders to maintain our REIT status. We intend to
make distributions to our shareholders to comply with the requirements of the Code.
Differences in timing between the recognition of taxable income and the actual receipt of cash could require us to sell assets or
borrow funds on a short-term or long-term basis to meet the 90% distribution requirement. In addition, the distribution
requirement reduces the amount of cash we retain for use in funding our capital requirements and our growth. As a result, we
have historically funded our acquisition, development and redevelopment activities by any of the following: selling assets that
no longer meet our investment criteria; selling common shares and preferred shares; borrowing from financial institutions; and
entering into joint venture transactions with third parties. Our failure to obtain funds from these sources could limit our ability
to grow, which could have a material adverse effect on the value of our securities.
9
There may be future dilution of our common shares
Our Declaration of Trust authorizes our Board to, among other things, issue additional common or preferred shares, or
securities convertible or exchangeable into equity securities, without shareholder approval. We may issue such additional
equity or convertible securities to raise additional capital. The issuance of any additional common or preferred shares or
convertible securities could be dilutive to holders of our common shares. Moreover, to the extent that we issue restricted
shares, options or warrants to purchase our common shares in the future and those options or warrants are exercised or the
restricted shares vest, our shareholders may experience further dilution. Holders of our common shares have no preemptive
rights that entitle them to purchase a pro rata share of any offering of shares of any class or series and, therefore, such sales or
offerings could result in increased dilution to our shareholders.
We may issue debt and equity securities or securities convertible into equity securities, any of which may be senior to our
common shares as to distributions and in liquidation, which could negatively affect the value of our common shares.
During 2012 we completed an underwritten public offering of 6.3 million common shares and issued 3.1 million common
shares through controlled equity offerings. In addition, there are 330,349 shares of unvested restricted common shares and
options to purchase 227,743 common shares outstanding at December 31, 2012.
Corporate Risks
The price of our common shares may fluctuate significantly.
The market price of our common shares fluctuates based upon numerous factors, many of which are outside of our control. A
decline in our share price, whether related to our operating results or not, may constrain our ability to raise equity in pursuit of
our business objectives. In addition, a decline in price may affect the perceptions of lenders, tenants, or others with whom we
transact. Such parties may withdraw from doing business with us as a result. An inability to raise capital at a suitable cost or at
any cost, or to do business with certain tenants or other parties, could affect our operations and financial condition.
Our failure to qualify as a REIT would result in higher taxes and reduced cash available for distribution to our shareholders.
We intend to operate in a manner so as to qualify as a REIT for federal income tax purposes. Our continued qualification as a
REIT will depend on our satisfaction of certain asset, income, investment, organizational, distribution, shareholder ownership
and other requirements on a continuing basis. Our ability to satisfy the asset requirements depends upon our analysis of the fair
market values of our assets, some of which are not susceptible to a precise determination, and for which we will not obtain
independent appraisals. In addition, our compliance with the REIT income and asset requirements depends upon our ability to
manage successfully the composition of our income and assets on an ongoing basis. Moreover, the proper classification of an
instrument as debt or equity for federal income tax purposes may be uncertain in some circumstances, which could affect the
application of the REIT qualification requirements. Accordingly, there can be no assurance that the Internal Revenue Service
(“IRS”) will not contend that our interests in subsidiaries or other issuers constitute a violation of the REIT requirements.
Moreover, future economic, market, legal, tax or other considerations may cause us to fail to qualify as a REIT.
If we were to fail to qualify as a REIT in any taxable year, we would be subject to federal income tax, including any applicable
alternative minimum tax, on our taxable income at regular corporate rates, and distributions to shareholders would not be
deductible by us in computing our taxable income. Any such corporate tax liability could be substantial and would reduce the
amount of cash available for distribution to our shareholders, which in turn could have an adverse impact on the value of, and
trading prices for, our common shares. Unless entitled to relief under certain Code provisions, we also would be disqualified
from taxation as a REIT for the four taxable years following the year during which we ceased to qualify as a REIT.
Even if we qualify as a REIT, we may be subject to various federal income and excise taxes, as well as state and local taxes.
Even if we qualify as a REIT, we may be subject to federal income and excise taxes in various situations, such as if we fail to
distribute all of our REIT taxable income. We also will be required to pay a 100% tax on non-arm’s length transactions between
us and our TRS and on any net income from sales of property that the IRS successfully asserts was property held for sale to
customers in the ordinary course of business. Additionally, we may be subject to state or local taxation in various state or local
jurisdictions, including those in which we transact business. The state and local tax laws may not conform to the federal
income tax treatment. Any taxes imposed on us would reduce our operating cash flow and net income.
10
The rules dealing with federal income taxation are constantly under review by persons involved in the legislative process and
by the IRS and the United States Treasury Department. Changes to tax laws, which may have retroactive application, could
adversely affect our shareholders or us. We cannot predict how changes in tax laws might affect our shareholders or us.
We are party to litigation in the ordinary course of business, and an unfavorable court ruling could have a negative effect on
us.
We are the defendant in a number of claims brought by various parties against us. Although we intend to exercise due care and
consideration in all aspects of our business, it is possible additional claims could be made against us. We maintain insurance
coverage including general liability coverage to help protect us in the event a claim is awarded; however, some claims may be
uninsured. In the event that claims against us are successful and uninsured or underinsured, or we elect to settle claims that we
determine are in our interest to settle, our operating results and cash flow could be adversely impacted. In addition, an increase
in claims and/or payments could result in higher insurance premiums, which could also adversely affect our operating results
and cash flow.
We are subject to various environmental laws and regulations which govern our operations and which may result in potential
liability.
Under various federal, state and local laws, ordinances and regulations relating to the protection of the environment, a current
or previous owner or operator of real estate may be liable for the costs of removal or remediation of certain hazardous or toxic
substances disposed, stored, released, generated, manufactured or discharged from, on, at, onto, under or in such property.
Environmental laws often impose such liability without regard to whether the owner or operator knew of, or was responsible
for, the presence or release of such hazardous or toxic substance. The presence of such substances, or the failure to properly
remediate such substances when present, released or discharged, may adversely affect the owner’s ability to sell or rent such
property or to borrow using such property as collateral. The cost of any required remediation and the liability of the owner or
operator therefore as to any property is generally not limited under such environmental laws and could exceed the value of the
property and/or the aggregate assets of the owner or operator. Persons who arrange for the disposal or treatment of hazardous or
toxic substances may also be liable for the cost of removal or remediation of such substances at a disposal or treatment facility,
whether or not such facility is owned or operated by such persons. In addition to any action required by federal, state or local
authorities, the presence or release of hazardous or toxic substances on or from any property could result in private plaintiffs
bringing claims for personal injury or other causes of action.
In connection with ownership (direct or indirect), operation, management and development of real properties, we have the
potential to be liable for remediation, releases or injury. In addition, environmental laws impose on owners or operators the
requirement of ongoing compliance with rules and regulations regarding business-related activities that may affect the
environment. Such activities include, for example, the ownership or use of transformers or underground tanks, the treatment or
discharge of waste waters or other materials, the removal or abatement of asbestos-containing materials (“ACMs”) or lead-
containing paint during renovations or otherwise, or notification to various parties concerning the potential presence of
regulated matters, including ACMs. Failure to comply with such requirements could result in difficulty in the lease or sale of
any affected property and/or the imposition of monetary penalties, fines or other sanctions in addition to the costs required to
attain compliance. Several of our properties have or may contain ACMs or underground storage tanks; however, we are not
aware of any potential environmental liability which could reasonably be expected to have a material impact on our financial
position or results of operations. No assurance can be given that future laws, ordinances or regulations will not impose any
material environmental requirement or liability, or that a material adverse environmental condition does not otherwise exist.
Restrictions on the ownership of our common shares are in place to preserve our REIT status.
Our Declaration of Trust restricts ownership by any one shareholder to no more than 9.8% of our outstanding common shares,
subject to certain exceptions granted by our Board. The ownership limit is intended to ensure that we maintain our REIT status
given that the Code imposes certain limitations on the ownership of the stock of a REIT. Not more than 50% in value of our
outstanding shares of beneficial interest may be owned, directly or indirectly by five or fewer individuals (as defined in the
Code) during the last half of any taxable year. If an individual or entity were found to own constructively more than 9.8% in
value of our outstanding shares, then any excess shares would be transferred by operation of our Declaration of Trust to a
charitable trust, which would sell such shares for the benefit of the shareholder in accordance with procedures specified in our
Declaration of Trust.
The ownership limit may discourage a change in control, may discourage tender offers for our common shares, and may limit
the opportunities for our shareholders to receive a premium for their shares. Upon due consideration, our Board previously has
11
granted a limited exception to this restriction for certain shareholders who requested an increase in their ownership limit.
However, the Board has no obligation to grant such limited exceptions in the future.
Certain anti-takeover provisions of our Declaration of Trust and Bylaws may inhibit a change of our control.
Certain provisions contained in our Declaration of Trust and Bylaws and the Maryland General Corporation Law, as applicable
to Maryland REITs, may discourage a third party from making a tender offer or acquisition proposal to us. These provisions
and actions may delay, deter or prevent a change in control or the removal of existing management. These provisions and
actions also may delay or prevent the shareholders from receiving a premium for their common shares of beneficial interest
over then-prevailing market prices.
These provisions and actions include:
•
•
•
•
•
•
the REIT ownership limit described above;
authorization of the issuance of our preferred shares of beneficial interest with powers, preferences or rights to be
determined by our Board;
special meetings of our shareholders may be called only by the chairman of our Board, the president, one-third of the
Trustees, or the secretary upon the written request of the holders of shares entitled to cast not less than a majority of all
the votes entitled to be cast at such meeting;
a two-thirds shareholder vote is required to approve some amendments to our Declaration of Trust;
our Bylaws contain advance-notice requirements for proposals to be presented at shareholder meetings; and
our Board, without the approval of our shareholders, may from time to time (i) amend our Declaration of Trust to increase
or decrease the aggregate number of shares of beneficial interest, or the number of shares of beneficial interest of any
class, that we have authority to issue, and (ii) reclassify any unissued shares of beneficial interest into one or more classes
or series of shares of beneficial interest.
In addition, the Trust, by Board action, may elect to be subject to certain provisions of the Maryland General Corporation Law
that inhibit takeovers such as the provision that permits the Board by way of resolution to classify itself, notwithstanding any
provision our Declaration of Trust or Bylaws.
Certain officers and trustees may have potential conflicts of interests with respect to properties contributed to the Operating
Partnership in exchange for OP Units.
Certain of our officers and members of our Board of Trustees own OP Units obtained in exchange for contributions of their
partnership interests in properties to the Operating Partnership. By virtue of this exchange, these individuals may have been
able to defer some, if not all, of the income tax liability they could have incurred if they sold the properties for cash. As a
result, these individuals may have potential conflicts of interest with respect to these properties, such as sales or refinancings
that might result in federal income tax consequences.
Item 1B. Unresolved Staff Comments.
None.
12
Item 2. Properties
As of December 31, 2012, we owned and managed a portfolio of 78 shopping centers and one office building with
approximately 15.0 million square feet of gross leasable area. Our wholly-owned properties consist of 52 shopping centers and
one office building comprising approximately 10.0 million square feet.
Property Name
CORE PORTFOLIO
COLORADO [2]
Harvest Junction North
Harvest Junction South
Total / Average
FLORIDA [20]
Cocoa Commons
Coral Creek Shops
Cypress Point
Kissimmee West
Marketplace of Delray
Martin Square
Mission Bay Plaza
Naples Towne Centre
River City Marketplace
River Crossing Centre
Rivertowne Square
Shoppes of Lakeland
The Crossroads
The Plaza at Delray
Treasure Coast Commons
Village Lakes Shopping Center
Village of Oriole Plaza
Village Plaza
Vista Plaza
West Broward Shopping Center
Total / Average
GEORGIA [7]
Centre at Woodstock
Conyers Crossing
Holcomb Center
Horizon Village
Mays Crossing
Paulding Pavilion
Peachtree Hill
Total / Average
ILLINOIS [3]
Liberty Square
Market Plaza
Rolling Meadows Shopping Center
Total/Average
INDIANA [2]
Merchants' Square
Nora Plaza
Total/Average
MARYLAND [1]
Crofton Centre
Total/Average
Ownership
%
Year Built /
Acquired /
Redeveloped
Total
GLA
%
Leased
Average base
rent per
leased SF Anchor Tenants (1)
100%
100%
2006/2012/NA
2006/2012/NA
159,385
176,960
96.6%
96.6%
$
15.58
14.57
Best Buy, Dick's Sporting Goods, Staples
Bed Bath & Beyond, Marshalls, Michaels, Ross Dress for Less,
(Lowe's)
336,345
96.6%
$
15.05
30%
100%
30%
7%
30%
30%
30%
100%
100%
100%
100%
100%
100%
20%
30%
100%
30%
30%
30%
30%
100%
100%
100%
100%
100%
20%
20%
100%
20%
20%
2001/2007/2008
1992/2002/NA
1983/2007/NA
2005/2005/NA
1981/2005/2010
1981/2005/NA
1989/2004/NA
1982/1996/2003
2005/2005/NA
1998/2003/NA
1980/1998/2010
1985/1996/NA
1988/2002/NA
1979/2004/NA
1996/2004/NA
1987/1997/NA
1986/2005/NA
1989/2004/NA
1998/2004/NA
1965/2005/NA
1997/2004/NA
1978/1998/NA
1986/1996/2010
1996/2002/NA
1984/1997/2007
1995/2006/2008
1986/2007/NA
1987/2010/2008
1965/2007/2009
1956/2008/1995
100%
7%
1970/2010/NA
1958/2007/2002
90,116
109,312
167,280
115,586
238,901
331,105
263,721
134,707
551,428
62,038
146,843
183,842
120,092
326,824
92,979
186,313
155,770
146,755
109,761
152,973
79.9%
97.0%
93.3%
92.7%
90.1%
91.5%
95.1%
88.8%
98.8%
97.7%
90.4%
97.3%
92.5%
97.9%
100.0%
63.6%
96.2%
70.0%
99.0%
97.6%
$
11.84
16.82
11.60
11.64
12.23
6.35
21.63
5.85
16.44
12.28
8.00
12.14
14.13
16.12
12.26
8.87
13.13
12.98
13.33
10.71
Publix
Publix
Burlington Coat Factory, The Fresh Market
Jo-Ann, Marshalls, (Super Target)
Office Depot, Ross Dress for Less, Winn-Dixie
Home Depot, Sears (2), Staples
The Fresh Market, Golfsmith, LA Fitness Sports Club,
OfficeMax, Toys "R" Us
Beall's, Save-A-Lot, (Goodwill)
Ashley Furniture HomeStore, Bed Bath & Beyond, Best Buy,
Gander Mountain, Michaels, OfficeMax, PetSmart, Ross Dress
for Less,
Wallace Theaters, (Lowe's), (Wal-Mart Supercenter)
Publix
Beall's Outlet, Winn-Dixie
Ashley Furniture, Michaels, Staples, T.J. Maxx (3), (Target)
Publix
Marshalls, Michaels, Publix, Regal Cinemas, Ross Dress for
Less, Staples
Barnes & Noble, OfficeMax, Sports Authority
Beall's Outlet, Ross Dress for Less (3)
Publix
Big Lots
Bed Bath & Beyond, Michaels, Total Wine & More
Badcock, DD's Discounts, Save-A-Lot, US Postal Service
3,686,346
92.2%
$
13.09
86,748
170,475
106,003
97,001
137,284
84,846
154,718
837,075
107,369
163,054
134,088
404,511
279,161
139,905
419,066
84.5%
100.0%
84.4%
72.0%
95.6%
97.6%
89.2%
90.2%
79.4%
85.9%
85.0%
83.9%
89.9%
93.1%
91.0%
$
11.40
5.21
11.76
11.28
7.07
14.63
12.93
9.86
13.82
15.01
11.11
13.40
$
$
$
$
$
10.35
13.37
11.39
Publix
Burlington Coat Factory, Hobby Lobby
Studio Movie Grill
Movie Tavern
Big Lots, Dollar Tree, Value Village-Sublease of ARCA Inc.
Sports Authority, Staples
Kroger, LA Fitness
Jewel-Osco
Jewel Osco, Staples
Jewel Osco, Northwest Community Hospital
Cost Plus, Hobby Lobby (2), (Marsh Supermarket)
Marshalls, Whole Foods, (Target)
20%
1974/1996/NA
252,230
252,230
98.4%
98.4%
$
$
8.17
8.17
Gold's Gym, Kmart, Shoppers Food Warehouse
13
(Home Depot)
OfficeMax, Sports Authority, (Target)
DSW Shoe Warehouse, Hobby Lobby, Office Depot
OfficeMax, (Sam's Club), (Target)
Best Buy, Citi Trends, (Burlington Coat Factory), (Target)
Oakridge Market
Meijer, Staples, Target
Dunham's, Kroger, Marshalls, OfficeMax
Bed Bath & Beyond, Buy Buy Baby, Loehmann's, Marshalls,
T.J. Maxx
Bed Bath & Beyond, Best Buy, Jackson 10 Theater, Kohl's, T.J.
Maxx,
Toys "R" Us, (Sears), (Target)
Lowe's, Michaels, OfficeMax
Hollywood Super Market, Kmart
Barnes & Noble, Dunham's, Elder-Beerman, Hobby Lobby, T.J.
Maxx,
Toys "R" Us, (Target)
Kroger, T.J. Maxx
Home Depot, Marshalls, Michaels, PetSmart, (Costco), (Meijer)
Jo-Ann, Kohl's
Hobby Lobby, T.J. Maxx
Marshalls, Wal-Mart
Big Lots, Burlington Coat Factory, Marshalls
Best Buy, DSW Shoe Warehouse, Lowe's, Meijer, Michaels,
Office Depot, PetSmart
Jo-Ann, Staples, (Best Buy), (Costco), (Meijer), (Target)
Plum Market
Airtime Trampoline, Golfsmith, LA Fitness, Nordstrom Rack,
PetSmart, (REI)
Best Buy, DSW Shoe Warehouse, Gander Mountain, Old Navy,
Home Goods & Michaels-Sublease of JLPK-Novi LLC
Jo-Ann, Marshalls, (Bed Bath & Beyond), (Big Lots), (Kohl's),
(Toys "R" Us), (Value City Furniture)
Bed Bath & Beyond, Dick's Sporting Goods, Marshalls,
Michaels, PetSmart, (Kmart)
Buy Buy Baby, Jo-Ann, OfficeMax, Ross Dress for Less
Dierbergs Markets, Marshalls, Office Depot, T.J. Maxx
Whole Foods, (Target)
Property Name
MICHIGAN [26]
Beacon Square
Clinton Pointe
Clinton Valley
Edgewood Towne Center
Fairlane Meadows
Fraser Shopping Center
Gaines Marketplace
Hoover Eleven
Hunter's Square
Ownership
%
Year Built /
Acquired /
Redeveloped
Total
GLA
%
Leased
Average base
rent per
leased SF Anchor Tenants (1)
100%
100%
100%
100%
100%
100%
100%
100%
30%
2004/2004/NA
1992/2003/NA
1977/1996/2009
1990/1996/2001
1987/2003/2007
1977/1996/NA
2004/2004/NA
1989/2003/NA
1988/2005/NA
51,387
135,330
201,115
85,757
157,246
68,326
392,169
280,788
354,323
95.3%
96.8%
97.8%
93.1%
98.3%
100.0%
100.0%
90.8%
98.3%
$
17.14
9.71
11.38
9.72
13.95
6.98
4.69
11.69
16.16
Jackson Crossing
100%
1967/1996/2002
398,526
95.7%
Jackson West
Lake Orion Plaza
Lakeshore Marketplace
Livonia Plaza
Millennium Park
New Towne Plaza
Oak Brook Square
Roseville Towne Center
Southfield Plaza
Tel-Twelve
The Auburn Mile
The Shops at Old Orchard
Troy Marketplace
100%
100%
100%
100%
30%
100%
100%
100%
100%
100%
100%
30%
30%
1996/1996/1999
1977/1996/NA
1996/2003/NA
1988/2003/NA
2000/2005/NA
1975/1996/2005
1982/1996/2008
1963/1996/2004
1969/1996/2003
1968/1996/2005
2000/1999/NA
1972/2007/2011
2000/2005/2010
210,374
141,073
342,854
136,616
272,568
192,587
152,073
246,968
185,409
523,411
90,553
96,994
217,754
97.5%
100.0%
98.0%
93.0%
99.2%
100.0%
96.5%
100.0%
97.7%
99.5%
100.0%
92.9%
100.0%
West Oaks I
100%
1979/1996/2004
243,987
100.0%
West Oaks II
100%
1986/1996/2000
167,954
96.2%
Winchester Center
30%
1980/2005/NA
314,575
90.3%
9.82
7.41
4.07
8.35
10.21
14.13
10.49
9.01
6.80
8.30
10.69
11.02
18.05
16.69
9.74
16.93
11.36
5,660,717
97.4%
$
10.64
100%
100%
100%
1970/2012/2012
1989/2011/2005
2008/2011/2011
166,431
269,185
141,996
577,612
100.0%
90.5%
83.7%
91.6%
$
$
10.71
13.29
24.05
14.85
Total / Average
MISSOURI [3]
Central Plaza
Heritage Place
Town & Country Crossing
Total / Average
NEW JERSEY [1]
Chester Springs Shopping Center
Total / Average
OHIO [5]
Crossroads Centre
Olentangy Plaza
Rossford Pointe
Spring Meadows Place
Troy Towne Center
Total / Average
100%
1990/1996/2003
144,485
1,050,933
97.3%
95.3%
6.45
9.31
$
14
20%
1970/1996/1999
223,201
223,201
96.6%
96.6%
$
$
13.89
13.89
Marshalls, Shop-Rite Supermarket, Staples
100%
20%
100%
100%
2001/2001/NA
1981/2007/1997
344,045
253,474
93.7%
95.0%
$
8.57
10.53
2006/2005/NA
1987/1996/2005
47,477
261,452
100.0%
95.6%
10.33
10.52
Giant Eagle, Home Depot, Michaels, T.J. Maxx, (Target)
Eurolife Furniture, Marshalls, Micro Center, Columbus Asia
Market-Sublease
of SuperValu, Tuesday Morning
MC Sporting Goods, PetSmart
Ashley Furniture, Big Lots, Guitar Center, OfficeMax, PetSmart,
T.J. Maxx, (Best Buy), (Dick's Sporting Goods), (Kroger),
(Sam's Club), (Target)
Kohl's, (Wal-Mart Supercenter)
Property Name
TENNESSEE [1]
Northwest Crossing
Total / Average
VIRGINIA [2]
The Town Center at Aquia
The Town Center at Aquia Office (4)
Total / Average
WISCONSIN [4]
East Town Plaza
Nagawaukee Center
The Shoppes at Fox River
West Allis Towne Centre
Total / Average
Ownership
%
Year Built /
Acquired /
Redeveloped
Total
GLA
%
Leased
Average base
rent per
leased SF Anchor Tenants (1)
100%
1989/1999/2006
124,453
100.0%
$
9.74
HH Gregg, OfficeMax, Ross Dress for Less, (Wal-
Mart Supercenter)
124,453
100.0%
$
9.74
100%
100%
1989/1998/NA
1989/1998/2009
40,518
98,147
100.0%
91.8%
$
10.64
26.64
Regal Cinemas
TASC
138,665
94.2%
$
21.68
100%
1992/2000/2000
208,472
86.5%
$
9.40
100%
100%
100%
1994/2012/NA
2009/2010/2011
1987/1996/2011
113,617
182,392
326,271
100.0%
100.0%
96.8%
10.07
15.70
7.84
Burlington Coat Factory, Jo-Ann, Marshalls,
(Menards), (Shopko), (Toys "R" Us)
Kohl's, (Sentry Foods)
Pick N' Save, T.J. Maxx, (Target)
Burlington Coat Factory, Kmart, Office Depot,
Xperience Fitness
830,752
95.3%
$
10.33
CORE PORTFOLIO TOTAL / AVERAGE
14,541,906
94.6%
$
11.54
FUTURE REDEVELOPMENTS/
AVAILABLE FOR SALE (5):
Promenade at Pleasant Hill
Total / Average
PORTFOLIO UNDER
REDEVELOPMENT:
100%
1993/2004/NA
280,225
280,225
51.5%
51.5%
$
$
9.83
9.83
Farmers Home Furniture, Publix
The Shops on Lane Avenue
20%
1952/2007/2004
Total / Average
170,398
170,398
98.2%
$
20.83
Bed Bath & Beyond, Whole Foods (3)
98.2%
$
20.83
PORTFOLIO TOTAL / AVERAGE (CORE AND UNDER REDEV)
14,992,529
93.8%
$
11.64
Footnotes
(1) Anchor tenants are any tenant over 19,000 square feet. Tenants in parenthesis represent non-company owned GLA.
(2) Tenant closed - lease obligated.
(3) Space delivered to tenant.
(4) Represents the Office Building at The Town Center at Aquia.
(5) Represents 0.9% of combined portfolio annual base rent.
Our leases for tenant space under 19,000 square feet generally have terms ranging from three to five years. Tenant leases
greater than or equal to 19,000 square feet generally have lease terms in excess of five years or more, and are considered anchor
leases. Many of the anchor leases contain provisions allowing the tenant the option of extending the lease term at expiration at
contracted rental rates that often include fixed rent increases, consumer price index adjustments or other market rate
adjustments from the prior base rent. The majority of our leases provide for monthly payment of base rent in advance,
percentage rent based on the tenant’s sales volume, reimbursement of the tenant’s allocable real estate taxes, insurance and
common area maintenance (“CAM”) expenses and reimbursement for utility costs if not directly metered.
15
Major Tenants
The following table sets forth as of December 31, 2012 the gross leasable area, or GLA, of our existing properties leased to
tenants in our combined properties portfolio:
Type of Tenant
Anchor (1)
Retail (non-anchor)
Total
Annualized
Base Rent
% of Total
Annualized Base
Rent
GLA (2)
% of Total
GLA (2)
$
81,142,505
81,499,312
162,641,817
$
49.9%
50.1%
100.0%
9,324,294
5,668,235
14,992,529
62.2%
37.8%
100.0%
(1) We define anchor tenants as tenants occupying a space consisting of 19,000 square feet or more.
(2) GLA owned directly by us or our unconsolidated joint ventures.
The following table depicts as of December 31, 2012 information regarding leases with the 25 largest retail tenants (1) in our
combined properties portfolio:
Tenant Name
Credit Rating
S&P/Moody's (2)
Number of
Leases
% of Total GLA
(3)
GLA
Total Annualized
Base Rent
Annualized Base
Rent PSF
% of Annualized
Base Rent
TJX Companies (4)
Bed Bath & Beyond (5)
Home Depot
Dollar Tree
Publix Super Market
LA Fitness Sports Club
Best Buy
Michaels Stores
PetSmart
Jo-Ann Stores
Staples
OfficeMax
Burlington Coat Factory
Whole Foods (6)
Kohl's
SUPERVALU (7)
Ascena Retail (8)
Gander Mountain
Ross Stores
Lowe's Home Centers
DSW Designer Shoe Warehouse
Meijer
Hobby Lobby
Office Depot
Kmart/Sears
A/A3
BBB+/NR
A-/A3
NR/NR
NR/NR
NR/NR
BB/Baa2
B/B2
BB+/NR
B/B2
BBB/Baa2
B-/B1
NR/NR
BBB-/NR
BBB+/Baa1
B/B3
BB-/Ba2
NR/NR
BBB+/NR
A-/A3
NR/NR
NR/NR
NR/NR
B-/B2
CCC+/B3
25
11
3
30
8
4
6
11
8
6
10
10
5
4
6
6
22
2
8
2
6
2
5
5
4
779,048
324,220
384,690
316,392
372,141
139,343
206,677
240,993
174,661
214,237
201,954
224,165
360,867
128,063
363,081
255,841
137,382
159,791
217,307
270,394
118,642
397,428
276,173
131,792
388,105
5.2%
2.2%
2.6%
2.1%
2.5%
0.9%
1.4%
1.6%
1.2%
1.4%
1.3%
1.5%
2.4%
0.9%
2.4%
1.7%
0.9%
1.1%
1.4%
1.8%
0.8%
2.7%
1.8%
0.9%
2.6%
$
7,433,711
3,681,382
3,110,250
2,912,935
2,790,512
2,753,755
2,721,008
2,603,874
2,511,142
2,510,184
2,492,460
2,429,388
2,390,179
2,285,908
2,223,027
2,200,959
2,033,472
1,981,282
1,954,166
1,822,956
1,792,878
1,731,560
1,640,038
1,590,652
1,586,159
$
9.54
11.35
8.09
9.21
7.50
19.76
13.17
10.80
14.38
11.72
12.34
10.84
6.62
17.85
6.12
8.60
14.80
12.40
8.99
6.74
15.11
4.36
5.94
12.07
4.09
Sub-Total top 25 tenants
209
6,783,387
45.3%
$
63,183,837
$
9.31
4.6%
2.3%
1.9%
1.8%
1.7%
1.7%
1.7%
1.6%
1.5%
1.5%
1.5%
1.5%
1.5%
1.4%
1.4%
1.4%
1.3%
1.2%
1.2%
1.1%
1.1%
1.1%
1.0%
1.0%
1.0%
39.0%
61.0%
Remaining tenants
Sub-Total all tenants
Vacant
1,344
1,553
7,191,402
48.0%
99,457,980
13.83
13,974,789
93.3%
$
162,641,817
$
11.64
100.0%
284
1,017,740
6.7%
N/A
N/A
N/A
N/A
100.0%
Total including vacant
1,837
14,992,529
100.0%
$
162,641,817
(1) Excludes one office tenant at Aquia office property. TASC (Formerly Northrup Grumann), base rent of $1.6 million.
(2) Source: Latest Company filings per CreditRiskMonitor.
(3) GLA owned directly by us or our unconsolidated joint ventures.
(4) Marshalls (15), T J Maxx (10).
(5) Bed Bath & Beyond (7), Buy Buy Baby (2), Cost Plus (2).
(6) Includes delivery of new 35K square foot Whole Foods at The Shops on Lane Avenue, which shall replace current 9,500 square footage temporary space.
(7) Jewel-Osco (3), Save-A-Lot (1), Shoppers Food (1), Sunflower Market (1).
(8) Fashion Bug (5), Catherine's (4), Maurices (4), Justice (4), Dress Barn (3), Lane Bryant (2).
16
Lease Expirations
The following tables set forth a schedule of lease expirations, for our combined portfolio, for the next ten years and thereafter,
assuming that no renewal options are exercised:
ALL TENANTS
Year
Number of Leases
Average Annualized
Base Rent
(per square foot)
Total
Annualized
Base Rent (1)
% of Total Annualized
Base Rent
GLA (2)
% of GLA
Expiring Leases As of December 31, 2012
(3)
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023+
Sub-Total
Leased (4)
Vacant
Total
36
219
266
279
228
181
102
44
41
45
46
66
1,553
17
267
$
12.10
12.10
10.90
11.77
12.00
12.99
12.66
10.72
9.96
10.49
12.30
10.95
11.64
$
1,740,163
12,020,017
17,957,611
22,292,860
24,251,734
21,944,069
11,700,663
8,287,337
6,154,001
8,546,936
7,723,789
20,022,637
162,641,817
N/A
N/A
N/A
N/A
1.1%
7.4%
11.0%
13.7%
14.9%
13.5%
7.2%
5.1%
3.8%
5.3%
4.7%
12.3%
100.0%
N/A
N/A
143,762
993,773
1,648,003
1,893,575
2,020,628
1,688,845
924,546
772,988
617,680
814,465
628,183
1,828,341
13,974,789
90,889
926,851
1.0%
6.6%
11.0%
12.6%
13.5%
11.3%
6.2%
5.2%
4.1%
5.4%
4.2%
12.1%
93.2%
0.6%
6.2%
1,837
$
11.64
$
162,641,817
100.0%
14,992,529
100.0%
(1) Annualized Base Rent in based upon rents currently in place.
(2) GLA owned directly by us or our unconsolidated joint ventures.
(3) Tenants currently under month to month lease or in the process of renewal.
(4) Lease has been executed, but space has not yet been delivered.
ANCHOR TENANTS (greater than or equal to 19,000 square feet)
Expiring Anchor Leases As of December 31, 2012
Year
Number of Leases
Average Annualized
Base Rent
(per square foot)
Total
Annualized
Base Rent (1)
% of Total Annualized
Base Rent
GLA (2)
% of GLA
(3)
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023+
Sub-Total
Leased (4)
Vacant
Total
1
10
19
30
32
31
17
13
9
17
10
27
216
1
5
$
8.50
6.17
6.49
8.64
8.84
10.69
10.08
9.12
7.29
9.19
9.89
9.71
8.95
$
204,000
2,386,008
5,529,897
9,704,064
11,070,512
11,913,837
5,831,445
5,751,568
3,341,510
5,938,953
4,186,508
15,284,203
81,142,505
N/A
N/A
N/A
N/A
0.3%
2.9%
6.8%
12.0%
13.6%
14.7%
7.2%
7.1%
4.1%
7.3%
5.2%
18.8%
100.0%
N/A
N/A
24,000
386,454
852,719
1,122,754
1,252,095
1,114,420
578,462
630,358
458,287
646,118
423,170
1,574,042
9,062,879
20,979
240,436
0.3%
4.1%
9.1%
12.0%
13.4%
12.0%
6.2%
6.8%
4.9%
6.9%
4.6%
16.9%
97.2%
0.2%
2.6%
222
$
8.95
$
81,142,505
100.0%
9,324,294
100.0%
(1) Annualized Base Rent in based upon rents currently in place.
(2) GLA owned directly by us or our unconsolidated joint ventures.
(3) Tenants currently under month to month lease or in the process of renewal.
(4) Lease has been executed, but space has not yet been delivered.
17
NON-ANCHOR TENANTS
Expiring Non-Anchor Leases As of December 31, 2012
Year
Number of Leases
Average Annualized
Base Rent
(per square foot)
Total
Annualized
Base Rent (1)
% of Total Annualized
Base Rent
GLA (2)
% of GLA
(3)
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023+
Sub-Total
Leased [4]
Vacant
Total
35
209
247
249
196
150
85
31
32
28
36
39
1,337
16
262
$
12.83
15.86
15.63
16.33
17.15
17.46
16.96
17.78
17.65
15.49
17.25
18.63
16.59
$
1,536,163
9,634,009
12,427,714
12,588,796
13,181,222
10,030,232
5,869,218
2,535,769
2,812,491
2,607,983
3,537,281
4,738,434
81,499,312
N/A
N/A
N/A
N/A
1.9%
11.8%
15.2%
15.4%
16.2%
12.3%
7.2%
3.1%
3.5%
3.2%
4.3%
5.9%
100.0%
N/A
N/A
119,762
607,319
795,284
770,821
768,533
574,425
346,084
142,630
159,393
168,347
205,013
254,299
4,911,910
69,910
686,415
2.1%
10.7%
14.0%
13.6%
13.6%
10.1%
6.1%
2.5%
2.8%
3.0%
3.6%
4.6%
86.7%
1.2%
12.1%
1,615
$
16.59
$
81,499,312
100.0%
5,668,235
100.0%
(1) Annualized Base Rent in based upon rents currently in place.
(2) GLA owned directly by us or our unconsolidated joint ventures.
(3) Tenants currently under month to month lease or in the process of renewal.
(4) Lease has been executed, but space has not yet been delivered.
Land Held for Development and/or Sale
At December 31, 2012, we had three projects in pre-development and various parcels of land held for development or sale
adjacent to certain of our existing developed properties located in Florida, Georgia, Michigan, Tennessee, and Virginia. It is
our policy to start vertical construction on new development projects only after the project has received entitlements, significant
anchor leasing commitments, construction financing, and joint venture partner commitments, if appropriate.
During 2012, we continued Phase I construction on Parkway Shops, our ground up development of an 89,123 square foot retail
shopping center located in Jacksonville, Florida. The center will be anchored by a 45,000 square foot Dick’s Sporting Goods
and a 25,000 square foot Marshalls and will also include approximately 19,000 square feet of non-anchor space. Total
projected project costs are $19.6 million. As of December 31, 2012, the total remaining projected cost is approximately $5.6
million and the project is 98.2% leased. The project is expected to be substantially complete in the second quarter of 2013. It
is our intention to hold the remaining land for the project as well as the other two development sites until it is economically
feasible to develop the planned retail sites.
Our development and construction activities are subject to risks such as inability to obtain the necessary zoning or other
governmental approvals for a project, determination that the expected return on a project is not sufficient to warrant
continuation of the planned development or change in plan or scope for the development. If any of these events occur, we may
record an impairment provision.
During the fourth quarter of 2012, we recorded an impairment provision of $1.4 million primarily due to additional costs to
ready parcels for sale and changes in estimated market value of parcels in our Stafford County, Virginia project. We recorded
impairment provisions of $11.5 million and $28.8 million in 2011 and 2010, respectively, related to developable land in that
project that we decided to market for sale. For a detailed discussion of our development projects, refer to Notes 1 and 6 of the
notes to the consolidated financial statements.
18
Insurance
Our tenants are generally responsible under their leases for providing adequate insurance on the spaces they lease. We believe
that our properties are adequately covered by commercial general liability, fire, flood, terrorism, environmental, and where
necessary, hurricane and windstorm insurance coverages, which are all provided by reputable companies, with commercially
reasonable exclusions, deductibles and limits.
Item 3. Legal Proceedings.
We are currently involved in certain litigation arising in the ordinary course of business.
Item 4. Mine Safety Disclosures
Not Applicable
19
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities.
Market Information
Our common shares are currently listed and traded on the New York Stock Exchange (“NYSE”) under the symbol “RPT”. On
February 15, 2013, the closing price of our common shares on the NYSE was $15.58.
Shareholder Return Performance Graph
The following line graph sets forth the cumulative total return on a $100 investment (assuming the reinvestment of dividends)
in each of our common shares, the NAREIT Equity Index, and the S&P 500 Index for the period December 31, 2007 through
December 31, 2012. The stock price performance shown is not necessarily indicative of future price performance.
Comparison of Cumulative Total Return
140
120
100
80
60
40
20
e
u
l
a
V
x
e
d
n
I
Ramco-Gershenson Properties Trust
NAREIT Equity
S&P 500
0
12/31/07
12/31/08
12/31/09
12/31/10
12/31/11
12/31/12
The following table depicts high and low closing prices and dividends declared per share for each quarter in 2012 and 2011:
Quarter Ended
High
Low
Dividends
Stock Price
December 31, 2012
September 30, 2012
June 30, 2012
March 31, 2012
December 31, 2011
September 30, 2011
June 30, 2011
March 31, 2011
(1) Paid on January 2, 2013
(2) Paid on January 3, 2012
$13.63
$13.57
$12.58
$12.23
$9.97
$12.68
$13.14
$13.51
$12.31
$12.01
$11.29
$9.98
$7.60
$8.19
$12.04
$12.43
(1)
(2)
$
$
$
$
0.16825
0.16325
0.16325
0.16325
$
$
$
$
0.16325
0.16325
0.16325
0.16325
20
Holders
The number of holders of record of our common shares was 1,533 at February 15, 2013. A substantially greater number of
holders are beneficial owners whose shares of record are held by banks, brokers and other financial institutions.
Dividends
Under the Code, a REIT must meet requirements, including a requirement that it distribute to its shareholders at least 90% of its
REIT taxable income annually, excluding net capital gain. Distributions paid by us are at the discretion of our Board and
depend on our actual net income available to common shareholders, cash flow, financial condition, capital requirements, the
annual distribution requirements under REIT provisions of the Code and such other factors as the Board deems relevant.
We have a Dividend Reinvestment Plan (the “DRIP”) which allows our common shareholders to acquire additional common
shares by automatically reinvesting cash dividends. Shares are acquired pursuant to the DRIP at a price equal to the prevailing
market price of such common shares, without payment of any brokerage commission or service charge. Common shareholders
who do not participate in the DRIP continue to receive cash distributions as declared.
Distributions on our 7.25% Series D Cumulative Convertible Perpetual Preferred Shares declared in 2012 totaled $3.625 per
share. We do not believe that the preferential rights available to the holders of our preferred shares or the financial covenants
contained in our debt agreements had or will have an adverse effect on our ability to pay dividends in the normal course of
business to our common shareholders or to distribute amounts necessary to maintain our qualification as a REIT.
For information on our equity compensation plans as of December 31, 2012, refer to Item 12 of Part III of this report and Note
16 of the notes to the consolidated financial statements.
21
Item 6. Selected Financial Data
The following table sets forth our selected consolidated financial data and should be read in conjunction with the consolidated
financial statements and notes to the consolidated financial statements and Management’s Discussion and Analysis of Financial
Condition and Results of Operations (“MD&A”) included elsewhere in this report.
Operating Data:
Total revenue
Property net operating income (1)
Income (loss) from continuing operations
Gain on sale of real estate assets
Net income (loss)
Net loss (income) attributable to noncontrolling interest
in subsidiaries
Preferred share dividends
Net (loss) income available to common shareholders
(Loss) earnings per common share, basic
Continuing operations
Discontinued operations
Basic (loss) earnings
(Loss) earnings per common share, diluted
Continuing operations
Discontinued operations
Diluted (loss) earnings
Weighted average shares outstanding:
Basic
Diluted
Cash dividends declared per RPT preferred share
Cash dividends declared per RPT common share
Cash distributions to RPT preferred shareholders
Cash distributions to RPT common shareholders
Balance Sheet Data (at December 31):
Cash and cash equivalents
Investment in real estate (before accumulated depreciation)
Total assets
Mortgages and notes payable
Total liabilities
Total RPT shareholders' equity
Noncontrolling interest in subsidiaries
Total shareholders' equity
2012
2011
Year Ended December 31,
2010
(In thousands, except per share)
2009
2008
$
128,738
$
117,574
$
107,636
$
108,758
$
117,757
88,881
8,621
69
7,092
112
(7,250)
(46)
$
0.03
(0.03)
$
-
$
0.03
(0.03)
$
-
79,052
(27,412)
231
(28,500)
1,742
(5,244)
(32,002)
72,411
(23,505)
2,096
(23,724)
3,576
-
(20,148)
72,648
9,679
5,010
15,936
(2,216)
-
13,720
77,422
27,746
19,595
27,432
(3,931)
-
23,501
$
$
$
$
$
$
$
$
(0.83)
(0.01)
(0.84)
(0.83)
(0.01)
(0.84)
(0.55)
(0.02)
(0.57)
(0.55)
(0.02)
(0.57)
0.44
0.18
0.62
0.44
0.18
0.62
$
$
$
$
$
$
$
$
1.28
(0.01)
1.27
1.28
(0.01)
1.27
44,101
44,485
38,466
38,466
35,046
35,046
22,193
22,193
18,471
18,478
$
$
3.63
0.66
$
$
2.67
0.65
$
-
$
0.65
$
-
$
0.79
$
-
$
1.62
$
$
7,250
28,333
$
$
3,432
25,203
$
-
$
22,501
$
-
$
17,974
$
-
$
34,338
$
4,233
1,119,171
1,165,291
541,281
605,459
529,783
30,049
559,832
$
12,155
996,908
1,048,823
518,512
567,649
449,075
32,099
481,174
$
10,175
1,074,095
1,052,829
571,694
613,463
402,273
37,093
439,366
$
8,432
1,002,855
997,957
552,836
591,392
367,228
39,337
406,565
$
4,816
1,010,714
1,014,526
663,189
701,488
273,714
39,324
313,038
Other Data:
Funds from operations ("FFO") available to RPT common shareholders (2)
Net cash provided by operating activities
Net cash (used in) provided by investing activities
Net cash provided by (used in) financing activities
$
47,816
62,194
(173,210)
103,094
$
29,509
44,703
(79,747)
37,024
$
20,945
43,249
(101,935)
60,385
$
45,263
48,064
(3,334)
(41,114)
$
47,362
26,998
33,617
(70,282)
(1) Property net operating income is a non-GAAP measure that is used internally to evaluate the performance of property operations and we consider it to be a significant
measure. Property net operating income should not be considered an alternative measure of operating results or cash flow from operations as determined in accordance
with GAAP. The reconciliation of property net operating income to net income is as follows:
Property net operating income
Management and other fee income
Depreciation and amortization
General and administrative expenses
Other expenses, net
Income tax benefit (provision)
(Loss) income from discontinued operations
Net income (loss)
$
88,881
$
79,052
$
72,411
$
72,648
$
77,422
4,064
(39,479)
(19,445)
(25,400)
34
(1,563)
4,126
(34,594)
(19,646)
(56,350)
(795)
(293)
4,192
(29,344)
(18,988)
(51,776)
670
(889)
4,911
(27,941)
(14,933)
(25,639)
633
6,257
6,482
(28,224)
(13,923)
(12,061)
(1,951)
(313)
$
7,092
$
(28,500)
$
(23,724)
$
15,936
$
27,432
(2) Under the National Association of Real Estate Investment Trusts (“NAREIT”) definition, FFO represents net income tributable to common shareholders, excluding
extraordinary items (as defined under accounting principles generally accepted in the United States of America (“GAAP”), gains (losses) on sales of depreciable property,
plus real estate related depreciation and amortization (excluding amortization of financing costs), and after adjustments for unconsolidated partnerships and joint ventures.
In addition, NAREIT has recently clarified its definition of FFO to exclude impairment provisions on depreciable property and equity investments in depreciable
property. See “Funds From Operations” in Item 7 for a discussion of FFO and a reconciliation of FFO to net income.
22
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with the consolidated financial statements, the notes thereto, and the
comparative summary of selected financial data appearing elsewhere in this report. Discontinued operations are discussed in
Note 5 of the notes to the consolidated financial statements in Item 8. The financial information in this MD&A is based on
results from continuing operations.
Overview
We are a fully integrated, self-administered, publicly-traded REIT specializing in the ownership, management, development
and redevelopment of community shopping centers located predominantly in the Eastern and Midwestern regions of the United
States. Most of our properties are multi-anchored by supermarkets and/or national chain stores. Our primary business is
managing and leasing space to tenants in the shopping centers we own. We also manage centers for our unconsolidated joint
ventures for which we charge fees. Our credit risk, therefore, is concentrated in the retail industry.
At December 31, 2012, we owned and managed, either directly or through our interest in real estate joint ventures, a total of 78
shopping centers and one office building, with approximately 15.0 million square feet of gross leasable area owned by us and
our joint ventures. We also owned interests in three parcels of land held for development and five parcels of land adjacent to
certain of our existing developed properties located in Florida, Georgia, Michigan, Tennessee, and Virginia.
We are predominantly a community shopping center company with a focus on managing and adding value to our portfolio of
centers that are primarily multi-anchored by grocery stores and/or nationally recognized discount department stores. We
believe that centers with a grocery and/or discount component attract consumers seeking value-priced products. Since these
products are required to satisfy everyday needs, customers usually visit the centers on a weekly basis. Over 46.0% of the GLA
of our shopping centers are anchored by tenants that sell groceries. Supermarket anchor tenants in our centers include, among
others, Publix Super Market, Whole Foods, Supervalu and Kroger. National chain anchor tenants in our centers include, among
others, TJ Maxx/Marshalls, Bed Bath and Beyond, Home Depot and Kohl’s
Our shopping centers are primarily located in targeted metropolitan markets areas predominantly in the Eastern and Midwestern
regions of the United States. Our focus on these markets has enabled us to develop a thorough understanding of the unique
characteristics of our markets. In both of our primary regions, we have concentrated a number of centers in reasonable
proximity to each other in order to achieve efficiencies in management, leasing and acquiring new properties.
In our existing centers, we focus on aggressive rental and leasing strategies and the value-added redevelopment of such
properties. We strive to increase rental income over time through contractual rent increases and leasing and re-leasing of
available space at higher rental levels, while balancing the needs for an attractive and diverse tenant mix. See Item 2,
“Properties” for additional information on rental revenue and lease expirations. In addition, we assess each of our centers
periodically to identify improvement opportunities and proactively engage in renovation and expansion activities based on
tenant demands, market conditions and capital availability. We also recognize the importance of customer satisfaction and
spend a significant amount of resources to ensure that our centers have sufficient amenities, appealing layouts and proper
maintenance.
As opportunities arise and market conditions permit, we may sell mature properties or non-core assets, which have less
potential for growth or are not viable for redevelopment. We intend to utilize the proceeds from such sales to reduce
outstanding debt, or fund development and redevelopment activities, or fund selective acquisition opportunities.
We intend to maximize shareholder value through a well-defined business strategy that incorporates the following elements:
Leasing and managing our shopping centers to increase occupancy, maximize rental income, and control operating
expenses and capital expenditures;
Redeveloping our centers to increase gross leasable area, reconfigure space for credit tenants, create outparcels, sell
excess land, and generally make the centers more desirable for our tenants and their shoppers;
Acquiring new shopping centers that are located in targeted metropolitan markets and that provide opportunities to add
value through intensive leasing, management, or redevelopment;
Developing our land held for development into income-producing investment property, subject to market demand,
availability of capital and adequate returns on our incremental capital;
Selling non-core shopping centers and redeploying the proceeds into investments that meet our criteria;
Selling available-for-sale land parcels and using the proceeds to pay down debt or reinvest in our business;
23
Maintaining a strong and flexible balance sheet by capitalizing our Company with a moderate ratio of debt to equity
and by financing our investment activities with various forms and sources of capital; and
Managing our overall enterprise to create an efficient organization with a strong corporate culture and transparent
disclosure for all stakeholders.
The economic performance and value of our shopping centers are dependent on various factors. The general economic
environment in the United States and credit availability began to see improvement during 2012 but continued high
unemployment and the slower rate of growth may affect our tenant’s abilities to pay base rent, percentage rent or other charges,
which may adversely affect our financial condition and results of operations. Further, our ability to re-lease vacant spaces may
be negatively impacted by the slow national economic recovery. These factors may impact the valuation of certain long-lived or
intangible assets that are subject to impairment testing, potentially resulting in impairment provisions which may be material to
our financial condition or results of operations. While we believe the locations of our centers and our diverse tenant base
should mitigate the negative impact of the economic environment, we may experience an increase in vacancy that will have a
negative impact on our revenue and bad debt expense. We continue to monitor our tenants’ operating performance as well as
trends in the retail industry to evaluate any future impact.
Critical Accounting Policies
Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon our consolidated
financial statements, which have been prepared in accordance with accounting principles generally accepted in the United
States of America (“GAAP”). The preparation of these financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent
assets and liabilities. Management bases its estimates on historical experience and on various other assumptions that are
believed to be reasonable under the circumstances. Management has discussed the development, selection and disclosure of
these estimates with the Audit Committee of our Board. Actual results could differ from these estimates under different
assumptions or conditions.
Critical accounting policies are those that are both significant to the overall presentation of our financial condition and results
of operations and require management to make difficult, complex or subjective judgments. For example, significant estimates
and assumptions have been made with respect to useful lives of assets, capitalization of development and leasing costs,
recoverable amounts of receivables and initial valuations and related amortization periods of deferred costs and intangibles.
The following discussion relates to what we believe to be our most critical accounting policies that require our most subjective
or complex judgment.
Revenue Recognition
Our shopping center space is generally leased to retail tenants under leases that are classified as operating leases. We recognize
minimum rents using the straight-line method over the terms of the leases commencing when the tenant takes possession of the
space and when construction of landlord funded improvements is substantially complete. Certain of the leases also provide for
contingent percentage rental income which is recorded on an accrual basis once the specified target that triggers this type of
income is achieved. The leases also provide for recoveries from tenants of common area maintenance (“CAM”), real estate
taxes and other operating expenses. The majority of our recoveries are estimated and recognized as revenue in the period the
recoverable costs are incurred or accrued. Revenues from management, leasing, and other fees are recognized in the period in
which the services have been provided and the earnings process is complete. Lease termination income is recognized when a
lease termination agreement is executed by the parties and the tenant vacates the space. When a lease is terminated early but
the tenant continues to control the space under a modified lease agreement, the lease termination fee is generally recognized
evenly over the remaining term of the modified lease agreement.
Current accounts receivable from tenants primarily relate to contractual minimum rent, percentage rent, real estate taxes, and
CAM or other operating expense reimbursements.
Accounts Receivable and Accrued Rent
We provide for bad debt expense based upon the allowance method of accounting. We continuously monitor the collectability
of our accounts receivable from specific tenants, analyze historical bad debts, customer creditworthiness, current economic
trends and changes in tenant payment terms when evaluating the adequacy of the allowance for bad debts. Allowances are
taken for those balances that we have reason to believe will be uncollectible. When tenants are in bankruptcy, we make
estimates of the expected recovery of pre-petition and post-petition claims. The period to resolve these claims can exceed one
24
year. Management believes the allowance for doubtful accounts is adequate to absorb currently estimated bad debts. However,
if we experience bad debts in excess of the allowance we have established, our operating income would be reduced. At
December 31, 2012 and 2011, our accounts receivable were $8.0 million and $9.6 million, respectively, net of allowances for
doubtful accounts of $2.6 million and $3.5 million, respectively.
In addition, many of our leases contain non-contingent rent escalations for which we recognize income on a straight-line basis
over the non-cancelable lease term. This method results in rental income in the early years of a lease being higher than actual
cash received, creating a straight-line rent receivable asset which is included in the “Other Assets” line item in our consolidated
balance sheets. We review our unbilled straight-line rent receivable balance to determine the future collectability of revenue
that will not be billed to or collected from tenants due to early lease terminations, lease modifications, bankruptcies and other
factors. Our evaluation is based on our assessment of tenant credit risk changes indicating that expected future straight-line rent
may not be realized. Depending on circumstances, we may provide a reserve against the previously recognized straight-line
rent receivable asset for a portion, up to its full value, that we estimate may not be received. The balance of straight-line rent
receivable at December 31, 2012 and 2011, net of allowances was $14.8 million and $16.0 million, respectively and is included
in other assets on our consolidated balance sheets. To the extent any of the tenants under these leases become unable to pay
their contractual cash rents, we may be required to write down the straight-line rent receivable from those tenants, which would
reduce our operating income.
Real Estate Investment
Income Producing
Real estate assets that we own directly are stated at cost less accumulated depreciation. Depreciation is computed using the
straight-line method. The estimated useful lives for computing depreciation are generally 25 – 40 years for buildings and 10 –
20 years for parking lot surfacing and equipment. We capitalize all capital improvement expenditures associated with
replacements and improvements to real property that extend the property’s useful life and depreciate such improvements over
their estimated useful lives ranging from 5 – 30 years. In addition, we capitalize tenant leasehold improvements and depreciate
them over the shorter of the useful life of the improvements or the term of the related tenant lease. We consider a number of
different factors to evaluate whether we or the tenant is the owner of the tenant improvement for accounting purposes. These
factors include: 1) whether the lease stipulates how and on what a tenant improvement allowance may be spent; 2) whether the
tenant or landlord retains legal title to the improvements; 3) the uniqueness of the improvements; 4) the expected economic life
of the tenant improvements relative to the term of the lease; and 5) who constructs or directs the construction of the
improvements. We depreciate all tenant improvements over the shorter of the useful life of the improvements or the term of the
related tenant lease. We charge maintenance and repair costs that do not extend an asset’s life to expense as incurred.
Sale of a real estate asset is recognized when it is determined that the sale has been consummated, the buyer’s initial and
continuing investment is adequate, our receivable, if any, is not subject to future subordination, and the buyer has assumed the
usual risks and rewards of ownership of the assets.
Development and Redevelopment
Real estate also includes costs incurred in the development of new operating properties and the redevelopment of existing
operating properties. These properties are carried at cost and no depreciation is recorded on these assets until the
commencement of rental revenue or no later than one year from the completion of major construction. These costs include pre-
development costs directly identifiable with the specific project, development and construction costs, interest, real estate taxes
and insurance. Interest is capitalized on land under development and buildings under construction based on the weighted
average rate applicable to our borrowings outstanding during the period and the weighted average balance of qualified assets
under development/redevelopment during the period. Indirect project costs associated with development or construction of a
real estate project are capitalized until the earlier of one year following substantial completion of construction or when the
property becomes available for occupancy.
The capitalized costs associated with development and redevelopment projects are depreciated over the useful life of the
improvements. If we determine a development or redevelopment project is no longer probable, we expense all capitalized costs
which are not recoverable.
Acquisitions
Acquisitions of properties are accounted for utilizing the acquisition method and, accordingly, the results of operations of an
acquired property are included in our results of operations from the date of acquisition. Estimates of fair values are based upon
25
future cash flows and other valuation techniques in accordance with our fair value measurements policy, which are used to
record the purchase price of acquired property among land, buildings on an “as if vacant” basis, tenant improvements,
identifiable intangibles and any gain on purchase. Identifiable intangible assets and liabilities include the effect of above-and
below-market leases, the value of having leases in place (“as-is” versus “as if vacant” and absorption costs), and out-of-market
assumed mortgages. Initial valuations are subject to change until such information is finalized, no later than twelve months
from the acquisition date. The impact of these estimates, including incorrect estimates in connection with acquisition values
and estimated useful lives, could result in significant differences related to the purchased assets, liabilities and resulting gain on
purchase, depreciation or amortization. For the years ended December 31, 2012, 2011 and 2010, we recorded in general and
administrative expenses approximately $0.2 million, $0.1 million, and $0.3 million, respectively, in costs associated with the
closing of our acquisitions.
The estimated fair value of acquired in-place leases are the costs we would have incurred to lease the properties to the
occupancy level of the properties at the date of acquisition. Such estimates include the fair value of leasing commissions, legal
costs and other direct costs that would be incurred to lease the properties to such occupancy levels. Additionally, we will
evaluate the time period over which such occupancy levels would be achieved. Such evaluation will include an estimate of the
net market-based rental revenues and net operating costs (primarily consisting of real estate taxes, insurance and CAM) that
would be incurred during the lease-up period. Acquired in-place leases as of the date of acquisition are amortized over the
remaining lease term.
Acquired above-and below-market lease values are recorded based on the present value (using an interest rate that reflects the
risks associated with the lease acquired) of the difference between the contractual amounts to be paid pursuant to the in-place
leases and management’s estimate of fair market value lease rates for the corresponding in-place leases. The capitalized above-
and below-market lease values are amortized as adjustments to rental revenue over the remaining terms of the respective leases,
which includes periods covered by bargain renewal options. Should a tenant terminate its lease prior to expiration, the
unamortized portion of the in-place lease value is charged to amortization expense and the unamortized portion of out-of-
market lease value is charged to rental revenue.
Impairment
We review our investment in real estate, including any related intangible assets, for impairment on a property-by-property basis
whenever events or changes in circumstances indicate that the remaining estimated useful lives of those assets may warrant
revision or that the carrying value of the property may not be recoverable. For operating properties, these changes in
circumstances include, but are not limited to, changes in occupancy, rental rates, tenant sales, net operating income, geographic
location, and real estate values. The viability of all projects under construction or development, including those owned by
unconsolidated joint ventures, are regularly evaluated under applicable accounting requirements, including requirements
relating to abandonment of assets or changes in use. To the extent a project, or individual components of the project, are no
longer considered to have value, the related capitalized costs are charged against operations.
Determining whether an investment in real estate is impaired and the amount of any such impairment requires considerable
management judgment. In the event that management changes its intended holding period for an investment in real estate,
impairment may result even without any other event or change in circumstances related to that investment. For example, a
determination to sell land held for development rather than to develop the land and hold the developed asset may result in
impairment. Similarly, a decision to sell an income producing property rather than to hold it may result in impairment. Under
certain circumstances, management may use probability-weighted scenarios related to an investment in real estate, and the use
of such analysis may also result in impairment. Impairment provisions resulting from any event or change in circumstances,
including changes in management’s intentions or management’s analysis of varying scenarios, could be material to our
consolidated financial statements.
We recognize an impairment of an investment in real estate when the estimated undiscounted cash flow is less than the net
carrying value of the property. If it is determined that an investment in real estate is impaired, then the carrying value is
reduced to the estimated fair value as determined by cash flow models and discount rates or comparable sales in accordance
with our fair value measurement policy.
In 2012, we recorded impairment provisions of $1.4 million related to land held for development or sale primarily due to
additional costs to ready parcels for sale and changes in estimated market value of parcels in our Stafford County, Virginia
project. In addition, we recorded $2.9 million of impairment provisions related to income producing properties. Our decision
to sell additional income producing properties accounted for $0.4 million of this impairment due to the estimated sales price
being lower than the net book value of one property. The balance of $2.5 million of impairment relates to a property that was
26
previously held in a consolidated partnership that conveyed its ownership interest in the property to the lender in 2012. See
Notes 6 of the notes to the consolidated financial statements for further information.
Off Balance Sheet Arrangements
We have five equity investments in unconsolidated joint venture entities in which we own 30% or less of the total ownership
interest. Because we can influence but not make significant decisions without our partner’s approval these investments are
accounted for under the equity method of accounting. We provide leasing, development, asset and property management
services to these joint ventures for which we are paid fees. Entities identified as variable interest entities are consolidated if we
are determined to be the primary beneficiary of the partially owned real estate joint venture. Refer to Note 7 of the notes to the
consolidated financial statements for further information.
We review our equity investments in unconsolidated entities for impairment on a venture-by-venture basis whenever events or
changes in circumstances indicate that the carrying value of the equity investment may not be recoverable. These changes in
circumstances include, but are not limited to, declines in real estate values in general, increases in interest rates in general, or
decreases in net operating income and occupancy of the properties held in the unconsolidated joint venture.
In testing for impairment of equity investments in unconsolidated entities, we primarily use cash flow models, discount rates,
and capitalization rates to estimate the fair values of properties held in joint ventures, and mark the debt of the joint ventures to
market. Determining whether an equity investment in an unconsolidated entity is impaired and, if so, the amount of the
impairment requires considerable management judgment. Changes to assumptions regarding cash flows, discount rates, or
capitalization rates could be material to our consolidated financial statements. We record an impairment provision when it is
determined that a decline in value is other than temporary. In 2012, we recorded a non-cash impairment provision of
approximately $0.4 million resulting from other-than-temporary declines in the fair market value of equity investments in
unconsolidated joint ventures. Refer to Note 6 of the notes to the consolidated financial statements for further information.
Fair Value Measurements
Certain financial instruments, estimates and transactions are required to be calculated, reported and/or recorded at fair value.
The estimated fair values of such financial items, including, debt instruments, impairments, acquisitions and derivatives, have
been determined using a market-based measurement. This measurement is determined based on the assumptions that
management believes market participants would use in pricing an asset or liability. As a basis for considering market
participant assumptions in fair value measurements, GAAP establishes three fair value levels, based on the markets in which
the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. The assessed inputs used
in determining any fair value measurement could result in incorrect valuations that could be material to our consolidated
financial statements. These levels are:
Level 1
Level 2
Level 3
Valuation is based upon quoted prices for identical instruments traded in active markets.
Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or
similar instruments in markets that are not active, and model-based valuation techniques for which all
significant assumptions are observable in the market.
Valuation is generated from model-based techniques that use at least one significant assumption not
observable in the market. These unobservable assumptions reflect estimates of assumptions that market
participants would use in pricing the asset or liability.
We utilize fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value
disclosures. Derivative instruments (interest rate swaps) are recorded at fair value on a recurring basis. Additionally, from time
to time, we may be required to record certain assets, such as impaired real estate assets, at fair value on a nonrecurring basis.
Deferred Charges
Debt financing costs are amortized primarily on a straight-line basis, which approximates the effective interest method, over the
terms of the debt. Lease costs represent the initial direct costs incurred in origination, negotiation and processing of a lease
agreement. Such costs include outside broker commissions, legal, and other independent third party costs, as well as salaries
and benefits, travel, and other internal costs directly related to completing a lease and are amortized over the life of the lease on
a straight-line basis. Costs related to supervision, administration, unsuccessful originations efforts and other activities not
directly related to the execution of leases are charged to expense as incurred.
27
Results of Operations
Comparison of the Year Ended December 31, 2012 to the Year Ended December 31, 2011
The following summarizes certain line items from our audited statements of operations which we believe are important in
understanding our operations and/or those items that have significantly changed during the year ended December 31, 2012 as
compared to 2011:
Total revenue
Recoverable operating expense
Other non-recoverable operating expense
Depreciation and amortization
General and administrative expense
Other expense, net
Gain on sale of real estate
Earnings from unconsolidated joint ventures
Interest expense
Amortization of deferred financing fees
Provision for impairment
Provision for impairment on equity investments in unconsolidated joint ventures
Bargain purchase gain on acquisition of real estate
Deferred gain recognized upon acquisition of real estate
Loss on extinguishment of debt
Income tax benefit (provision)
Loss from discontinued operations
Net loss attributable to noncontrolling interest
Preferred share dividends
Net loss available to common shareholders
NM - Not Meaningful
Year Ended December 31,
2012
2011
(In thousands)
Dollar
Change
Percent
Change
$
128,738
$
117,574
$
11,164
32,955
2,838
39,479
19,445
(66)
69
3,248
(25,895)
(1,449)
(1,766)
(386)
-
845
-
34
(1,563)
112
30,856
3,540
34,594
19,646
(257)
231
1,669
(27,636)
(1,861)
(16,917)
(9,611)
-
-
(1,968)
(795)
(293)
1,742
2,099
(702)
4,885
(201)
191
(162)
1,579
1,741
412
15,151
9,225
-
845
1,968
829
(1,270)
(1,630)
(7,250)
(46)
$
(5,244)
(32,002)
$
(2,006)
31,956
$
9.5%
6.8%
-19.8%
14.1%
-1.0%
-74.3%
NM
94.6%
-6.3%
-22.1%
-89.6%
-96.0%
NM
NM
NM
-104.3%
433.4%
NM
38.3%
-99.9%
Total revenue in 2012 increased $11.2 million, or 9.5% from 2011. The increase is primarily due to the following:
$12.6 million increase in minimum rent and recovery income related to our 2011 and 2012 acquisitions and increases
at existing centers; offset by
lower lease termination income of $1.4 million.
Recoverable operating expense and real estate taxes in 2012 increased $2.1 million, or 6.8% from 2011. The increase was
primarily related to our acquisitions in 2011 and 2012.
Other non-recoverable operating expense in 2012 decreased 0.7 million, or 19.8% from 2011 primarily due to lower allowance
for bad debts.
Depreciation and amortization expense in 2012 increased $4.9 million, or 14.1%, from 2011. The increase was primarily due to
our acquisitions in 2011 and 2012.
Other expense, net in 2012 decreased $0.2 million, or 74.3% from 2011 The decrease in net expense was primarily due to
insurance proceeds of $0.8 million received in 2012 for a tenant fire, partly offset by lower real estate tax expense related to
land held for development or sale.
Earnings from unconsolidated joint ventures in 2012 increased $1.6 million from 2011. In 2011 a joint venture recorded an
impairment provision of $5.5 million, of which our share was $1.6 million.
Interest expense in 2012 decreased $1.7 million, or 6.3%, from 2011 primarily due to lower revolving credit facility/term loan
interest and the payoff of several higher interest rate mortgages in 2011 and 2012.
28
Amortization of deferred financing fees in 2012 decreased $0.4 million, or 22.1% from 2011. The decrease is primarily due to
the refinancing of our revolving credit facility in the second quarter of 2011 which resulted in the write-off of associated
deferred financing costs.
Impairment provisions of $4.7 million recorded in 2012 related to the decision to market certain income-producing properties
for sale, adjustments to the sales price assumptions for certain undeveloped land parcels available for sale at several of our
development properties and other-than-temporary decline in the fair market value of an equity investments in unconsolidated
joint ventures. In the fourth quarter 2011 our impairment provisions totaled $26.5 million. Refer to Note 7 of the notes to the
consolidated financial statements for a detailed discussion of these charges.
In 2012 we recorded a deferred gain of $0.8 million due to the sale of one property held in a joint venture. The deferred gain
related to our proportional 7% equity interest when the property was sold to the joint venture in 2007.
In 2011 we recorded a one-time write-off of unamortized deferred financing costs related to the extinguishment of debt of
approximately $2.0 million. There was no similar charge in 2012.
The income tax benefit was $34,000 in 2012 compared to a tax provision of $0.8 million in 2011. The decrease is due to the
2011 repeal of the Michigan Business Tax which resulted in a one-time write-off of net deferred tax assets of $0.8 million.
Loss from discontinued operations was $1.6 million in 2012 compared to loss of $0.3 million in 2011. In 2012 we recorded a
gain on sale of real estate of $0.3 million compared to $9.4 million in 2011 and the subject properties recorded net operating
income of $0.6 million in 2012 compared to a net operating loss of $0.1 million in 2011. In addition, in 2012 a non-cash
provision for impairment of $2.5 and a $0.3 million gain on extinguishment of debt was recorded related to a property that was
previously held in a consolidated joint venture compared to a non-cash provision of $10.9 million and a $1.2 million gain on
extinguishment of debt in 2011. In both 2012 and 2011 the gain on extinguishment of debt was the result of completing a deed-
in-lieu transfer to the lender in exchange for full release under mortgage loan obligations at each property.
Preferred share dividends in 2012 increased $2.0 million or 38.3% from 2011 due to the preferred equity offering that was
completed in April 2011.
29
Comparison of the Year Ended December 31, 2011 to the Year Ended December 31, 2010
The following summarizes certain line items from our audited statements of operations which we believe are important in
understanding our operations and/or those items which have significantly changed during the year ended December 31, 2011 as
compared to 2010:
Total revenue
Recoverable operating expense
Other non-recoverable operating expense
Depreciation and amortization
General and administrative expense
Other expense, net
Gain on sale of real estate
Earnings (loss) from unconsolidated joint ventures
Interest expense
Amortization of deferred financing fees
Provision for impairment
Provision for impairment on equity investments in unconsolidated joint ventures
Bargain purchase gain on acquisition of real estate
Deferred gain recognized upon acquisition of real estate
Loss on extinguishment of debt
Income tax (provision) benefit
Loss from discontinued operations
Net loss attributable to noncontrolling interest
Preferred share dividends
Net loss available to common shareholders
NM - Not meaningful
Year Ended December 31,
2011
2010
(In thousands)
Dollar
Change
$
117,574
$
107,636
$
9,938
30,856
3,540
34,594
19,646
(257)
231
1,669
(27,636)
(1,861)
(16,917)
(9,611)
-
-
(1,968)
(795)
(293)
1,742
28,613
2,420
29,344
18,988
(973)
2,096
(221)
(30,268)
(2,602)
(28,787)
(2,653)
9,836
1,796
-
670
(889)
3,576
2,243
1,120
5,250
658
716
(1,865)
1,890
2,632
741
11,870
(6,958)
(9,836)
(1,796)
(1,968)
(1,465)
596
(1,834)
(5,244)
(32,002)
$
-
(20,148)
$
(5,244)
(11,854)
$
Percent
Change
9.2%
7.8%
46.3%
17.9%
3.5%
73.6%
NM
-855.2%
-8.7%
-28.5%
-41.2%
262.3%
NM
NM
NM
-218.7%
-67.0%
-51.3%
NM
58.8%
Total revenue increased in 2011 $9.9 million, or 9.2%, from 2010. The increase is primarily due to the following:
$9.0 million increase in minimum rent and tenant recovery income primarily related to our acquisitions in 2011 and
2010 and increases at existing centers; and
$1.3 million increase in lease termination income; offset by
$0.5 million decrease in property level interest income.
Recoverable operating expenses in 2011 increased by $2.2 million, or 7.8% from 2011 primarily due to our acquisitions in
2011 and 2010.
Other non-recoverable operating expenses in 2011 increased $1.1 million, or 46.3% from 2011. The increase was primarily due
to our acquisitions in 2011 and 2010.
Depreciation and amortization expense in 2011 increased by $5.3 million, or 17.9% from 2011. Of that increase $4.9 million
was related to our acquisitions in 2011 and 2010 and approximately $0.8 million was associated with accelerated depreciation
for building demolition in 2011 at two properties.
General and administrative expenses in 2012 increase $0.7 million, or 3.5% from 2010. The increase in 2011 was primarily
related to the following:
an increase in net compensation expense due primarily to:
o $1.1 million in higher severance expense and annual pay increases and $0.7 million in lower capitalization of
development and leasing salaries and related costs in 2011. Salaries capitalized in 2011 represented
approximately 21.3% of total salaries compared to 27.4% in 2010; and
o $0.5 million reduction to long-term incentive expense in 2010 for not meeting performance measures;
partially offset by
a decrease in legal fees of approximately $0.8 million related to our defense against a lawsuit with a subcontractor in
2010 as well as lower corporate legal expense in 2011; and
30
a decrease in acquisition, non-viable redevelopment expense and D&O insurance costs of approximately $0.3 million.
Other expense decreased $0.7 million to $(0.3) million in 2011 from $(1.0) million in 2010. The decrease was primarily related
to a $0.5 million easement fee earned in 2011 at one of our development projects located in Jacksonville, Florida and a $0.2
million decrease in real estate tax expense in 2011 on development projects that were placed on hold in 2010.
Gain on sale of real estate in 2011 decreased $1.9 million from 2010 due to the sale of three outparcels in 2010.
Earnings (loss) from unconsolidated joint ventures increased in 2011 by $1.9 million primarily due the following:
the sale of Shenandoah Square shopping center resulted in our proportionate share of the gain of $2.7 million, plus
$0.2 million of promote fee income;
2010 included higher default interest expense, bad debt expense and impairment provision of $1.6 million; partially
offset by
an increase in depreciation expense of $2.6 million due to the commencement of two redevelopment projects, resulting
in a reduction to the useful lives of certain buildings that were subsequently demolished to prepare for the properties’
redevelopment.
Interest expense in 2011 decreased $2.6 million, or 8.7% from 2010 due primarily to the payoff of several mortgages and a
lower revolving line of credit balance.
Amortization of deferred financing fees expense in 2011 decreased $0.7 million, or 28.5% from 2010 which was primarily due
to the refinancing of our revolving line of credit.
Impairment provisions of $26.5 million were recorded in 2011 related to the decision to market certain income-producing
properties for sale, adjustments to the sales price assumptions for certain undeveloped land parcels available for sale at several
of our development properties and other-than-temporary declines in the fair market value of various equity investments in
unconsolidated joint ventures. During 2010 impairment provisions of $31.4 million were recorded related to the marketing of
certain undeveloped land parcels for sale and other-than-temporary declines in the fair market value of various equity
investments in unconsolidated joint ventures. Refer to Note 7 of the notes to the consolidated financial statements for a detailed
discussion of these charges.
In 2010, we recorded a bargain purchase gain of $9.8 million and a previously deferred gain of $1.8 million related to the
transfer of ownership interest in the Merchants’ Square Shopping Center. There were no similar activities in 2011.
Loss on extinguishment of debt was $2.0 million in 2011 related to a one-time write-off of unamortized deferred financing
costs related to the prior secured revolving line of credit and term loan. There were no comparable activities in 2010.
The income tax provision was $0.8 million in 2011 as compared to a tax benefit of $0.7 million in 2010. The increase in
income tax expense was primarily due to the repeal of the Michigan Business Tax that resulted in a one-time write-off of net
deferred tax assets of $0.8 million. Refer to Note 17 of the notes to the condensed consolidated financial statements for further
information.
Loss from discontinued operations was $0.3 million in 2011 compared to $0.8 million in 2010. The subject properties recorded
net operating loss of $0.1 million in 2011 compared to a net operating income of $1.4 million in 2010. In 2011, we sold the
Lantana Shopping Center located in Lantana, Florida, the Sunshine Plaza Shopping Center located in Tamarac, Florida and the
Taylor’s Square shopping center located in Greenville, South Carolina which generated an aggregate gain on sale of $7.2
million. In addition we sold an outparcel at the Southbay Shopping Center located in Osprey, Florida which generated a gain
on sale of $2.2 million. Also in 2011, we conveyed interest and title on our Madison Center located in Madison Heights,
Michigan to the lender thereby satisfying the debt obligation. The transaction resulted in a gain on debt extinguishment of $1.2
million which is included in income from discontinued operations. In 2010, we sold one shopping center located in Elkin,
North Carolina for a net loss of $2.1 million.
Net income attributable to noncontrolling interest decreased $1.8 million primarily due to the acquisition of our partner’s 80%
interest in the Ramco RM Hartland SC LLC joint venture in the first quarter 2011, and was partially offset by higher net loss in
2011.
For the year ended December 31, 2011, we declared dividends of $5.2 million to preferred shareholders resulting from the April
2011 preferred equity offering. There were no preferred shares outstanding in 2010.
31
Liquidity and Capital Resources
The majority of our cash is generated from operations and is dependent on the rents that we are able to charge and collect from
our tenants. The principal uses of our liquidity and capital resources are for operations, developments, redevelopments,
including expansion and renovation programs, acquisitions, and debt repayment. In addition, we make quarterly dividend
payments in accordance with REIT requirements for distributing the substantial majority of our taxable income on an annual
basis. We anticipate that the combination of cash on hand, cash from operations, availability under our credit facilities,
additional financings, equity offerings, and the sale of existing properties will satisfy our expected working capital requirements
through at least the next 12 months. Although we believe that the combination of factors discussed above will provide
sufficient liquidity, no such assurance can be given.
At December 31, 2012 and 2011, we had $8.1 million and $18.2 million, respectively, in cash and cash equivalents and
restricted cash. Restricted cash was comprised primarily of funds held in escrow by lenders to pay real estate taxes, insurance
premiums, and certain capital expenditures.
Short-Term Liquidity Requirements
Our short-term liquidity needs consist primarily of funds necessary to pay operating expenses associated with our operating
properties, interest and scheduled principal payments on our debt, quarterly dividend payments (including distributions to
Operating Partnership unit holders) and capital expenditures related to tenant improvements and redevelopment activities.
We have no debt maturities until July 2013, when two mortgage loans mature totaling $13.0 million.
We continually search for investment opportunities that may require additional capital and/or liquidity. As of December 31,
2012, we had no proposed property acquisitions under contract. Refer to Note 20 of the notes to the consolidated financial
statements for further information related to activity subsequent to December 31, 2012.
Long-Term Liquidity Requirements
Our long-term liquidity needs consist primarily of funds necessary to pay indebtedness at maturity, potential acquisitions of
properties, redevelopment of existing properties, the development of land and non-recurring capital expenditures.
During 2012, we closed a $360 million unsecured credit facility which amends and restates our prior $250 million facility. The
amended facility is comprised of a $240 million revolving line of credit with a four-year term and one-year extension option
and a five-year $120 million term loan. The amended facility can be upsized to $450 million through an accordion feature.
Borrowings under the amended facility are priced at LIBOR plus 165 to 225 basis points based upon a pricing grid tied to our
leverage ratio. As of December 31, 2012, $198.8 million was available to be drawn on our unsecured revolving credit facility
subject to certain covenants.
Our financing strategy is to maintain ample liquidity, financial strength, and financial flexibility by sourcing equity and debt
capital in appropriate balance, managing our debt maturity schedule, and monitoring our exposure to interest rate risk.
32
The following is a summary of our cash flow activities:
Year Ended December 31,
2012
2011
(In thousands)
2010
Cash provided by operating activities
$
62,194
$
44,703
$
43,249
Cash used in investing activities
Cash provided by financing activities
(173,210)
103,094
(79,747)
37,024
(101,935)
60,385
We generated $62.2 million in cash flows from operating activities as compared to $44.7 million in 2011. Net operating
income increased $7.1 million as a result of our acquisitions (net of dispositions) and our leasing activity at our shopping
centers. Net accounts receivable decreased $1.1 million from 2011. Interest expense decreased $3.0 million because of
deleveraging, reducing interest rates on our bank financings, and using more variable-rate debt, which has lower rates
than long-term, fixed rate financing.
Investing activities used $173.2 million of cash flows as compared to $79.7 million in 2011. Acquisitions of real estate
increased $72.7 million , reflecting a higher volume of acquisitions. Additions to real estate increased $14.0 million, as a
result of an increase in development funding by $12.0 million, and a modest increase in capital expenditures of $0.4
million. Net proceeds from sales of real estate and distributions from the sale of joint venture property together
decreased $18.7 million. Investment in unconsolidated joint ventures and the purchase of a partner’s equity decreased
$6.4 million. We received a net $3.0 million note repayment and restricted cash decreased $2.5 million.
Cash flows provided by financing activities were $103.1 million as compared to $37.0 million in 2011. This difference
of $66.1 million is primarily explained by our net borrowing of $31.3 million of debt and payment of $2.0 million in
deferred financing costs in 2012 compared to net repayment of $34.5 million of debt and payment of $2.8 million in
deferred financing costs in 2011. In 2012 we had proceeds of $111.5 million from common share issuances compared to
$105.5 million in proceeds from the issuance of common shares and preferred shares in 2011. Cash dividends to
preferred shareholders were $3.8 million higher in 2012 as dividends did not commence until April in 2011. Cash
dividends to common shareholders were higher by $3.1 million due to the increase in the number of common shares
outstanding.
Dividends and Equity
We believe that we currently qualify, and intend to continue to qualify in the future, as a REIT under the Internal Revenue Code
of 1986, as amended (“the Code”). Under the Code, as a REIT we must distribute to our shareholders at least 90% of our REIT
taxable income annually, excluding net capital gain. Distributions paid are at the discretion of our Board and depend on our
actual net income available to common shareholders, cash flow, financial condition, capital requirements, restrictions in
financing arrangements, the annual distribution requirements under REIT provisions of the Code and such other factors as our
Board deems relevant.
We paid cash dividends of $0.653 per common share to shareholders in 2012. In the fourth quarter we increased our quarterly
dividend 3% to $0.16825 per share, or an annualized rate of $0.673 per share. Cash dividends for 2011 and 2010 were $0.653
per common share. Our dividend policy has not changed in that we expect to continue making distributions to shareholders of
at least 90% of our REIT taxable income, excluding net capital gain, in order to maintain qualification as a REIT. On an
annualized basis, our current dividend is above our estimated minimum required distribution. Distributions paid by us are
funded from cash flows from operating activities. To the extent that cash flows from operating activities were insufficient to
pay total distributions for any period, alternative funding sources are used as shown in the following table. Examples of
alternative funding sources may include proceeds from sales of real estate and bank borrowings. Although we may use
alternative sources of cash to fund distributions in a given period, we expect that distribution requirements for an entire year
will be met with cash flows from operating activities.
33
Year Ended December 31,
2012
2011
2010
(In thousands)
Cash provided by operating activities
$
62,194
$
44,703
$
43,249
Cash distributions to preferred shareholders
Cash distributions to common shareholders
Cash distributions to operating partnership unit holders
Total distributions
Surplus
(7,250)
(28,333)
(1,814)
(3,432)
(25,203)
(2,159)
-
(22,501)
(1,906)
$
(37,397)
$
(30,794)
$
(24,407)
$
24,797
$
13,909
$
18,842
During 2012, we issued 6.325 million common shares through a follow-on equity offering generating $73.2 million in net
proceeds which we used to reduce outstanding borrowings under our revolving credit facility and to fund a portion of the
consideration for the acquisition of four shopping centers. The offering of the shares was made pursuant to our registration
statement on Form S-3 (No. 333-174805).
In addition, during 2012, we issued 3.1 million common shares through our controlled equity offerings generating $38.1 million
in net proceeds, after sales commissions and fees of $0.8 million. We used the net proceeds for general corporate purposes
including the repayment of debt. In September 2012, we entered into a new controlled equity offering whereby we may sell up
to 6.0 million common shares of beneficial interest once the shares of the previous offering had been issued. The shares to be
issued in the controlled equity offering are registered with the Securities and Exchange Commission (“SEC”) on our
registration statement on Form S-3 (No. 333-174805).
Debt
During 2012 we closed a $360 million unsecured credit facility which amends and restates our prior $250 million facility. The
amended facility is comprised of a $240 million revolving line of credit with a four-year term and one-year extension option
and a five-year $120 million term loan. The amended facility can be upsized to $450 million through an accordion feature.
Borrowings under the amended facility are priced at LIBOR plus 165 to 225 basis points based upon a pricing grid tied to our
leverage ratio. As of December 31, 2012, $198.8 million was available to be drawn on our unsecured revolving credit facility
subject to certain covenants that may affect availability.
Also during 2012 we repaid two wholly owned property mortgages secured by our Coral Creek and The Crossroads shopping
centers totaling $19.6 million.
In addition we conveyed title to our 77.9% owned Kentwood Towne Centre located in Kentwood, Michigan to the lender in
exchange for release from an $8.5 million non-recourse mortgage obligation.
It is anticipated that funds borrowed under our credit facilities will be used for general corporate purposes, including working
capital, capital expenditures, the repayment of indebtedness or other corporate activities. For further information on the credit
facilities and other debt, refer to Note 9 of the consolidated financial statements.
At December 31, 2012, we had four interest rate swap agreements in effect for an aggregate notional amount of $135.0 million
converting our floating rate corporate debt to fixed rate debt. After taking into account the impact of converting our variable
rate debt to fixed rate debt by use of the interest rate swap agreements, at December 31, 2012, we had $85.0 million of variable
rate debt outstanding.
At December 31, 2012, we had $293.2 million of fixed rate mortgage loans encumbering certain consolidated properties. Such
mortgage loans are non-recourse, subject to certain exceptions for which we would be liable for any resulting losses incurred by
the lender. These exceptions vary from loan to loan but generally include fraud or a material misrepresentation, misstatement
or omission by the borrower, intentional or grossly negligent conduct by the borrower that harms the property or results in a
loss to the lender, filing of a bankruptcy petition by the borrower, either directly or indirectly, and certain environmental
liabilities. In addition, upon the occurrence of certain of such events, such as fraud or filing of a bankruptcy petition by the
34
borrower, we would be liable for the entire outstanding balance of the loan, all interest accrued thereon and certain other costs,
penalties and expenses.
Off Balance Sheet Arrangements
Real Estate Joint Ventures
We consolidate entities in which we own less than 100% equity interest if we have a controlling interest or are the primary
beneficiary in a variable interest entity, as defined in the Consolidation Topic of FASB ASC 810. From time to time, we enter
into joint venture arrangements from which we believe we can benefit by owning a partial interest in a property.
As of December 31, 2012, we had five equity investments in unconsolidated joint venture entities in which we owned 30% or
less of the total ownership interest and accounted for these entities under the equity method. Refer to Note 7 of the notes to the
consolidated financial statements for more information.
We have a 30% ownership interest in our Ramco Lion joint venture which owns a portfolio of 15 properties totaling 10.0
million square feet of GLA. As of December 31, 2012, the properties had consolidated equity of $306.3 million. Our total
investment in the venture at December 31, 2012 was $78.1 million. The Ramco Lion joint venture has total debt obligations of
approximately $181.7 million with maturity dates ranging from 2013 through 2020. Our proportionate share of the total debt is
$54.5 million. Such debt is non-recourse to the venture, subject to carve-outs customary to such types of mortgage financing.
We have a 20% ownership interest in our Ramco 450 joint venture which is a portfolio of eight properties totaling 1.7 million
square feet of GLA. As of December 31, 2012, the properties in the portfolio had consolidated equity of $126.7 million. Our
total investment in the venture at December 31, 2012 was $15.1 million. The Ramco 450 venture has total debt obligations of
approximately $170.7 million with maturity dates ranging from 2013 through 2023 Our proportionate share of the total debt is
$34.2 million. Such debt is non-recourse to the venture, subject to carve-outs customary to such types of mortgage financing.
We also have ownership interests ranging from 7% - 20% in three smaller joint ventures that each own one property. As of
December 31, 2012, these properties have combined equity of $46.0 million. Our total investment in these ventures was $2.8
million. One joint venture has non-recourse debt in the amount of $7.9 million with a maturity date of January 2014. Our
proportionate share of the debt is $1.6 million.
We review our equity investments in unconsolidated entities for impairment on a venture-by-venture basis whenever events or
changes in circumstances indicate that the carrying value of the equity investment may not be recoverable. In testing for
impairment of these equity investments, we primarily use cash flow models, discount rates, and capitalization rates to estimate
the fair value of properties held in joint ventures, and we also estimate the fair value of the debt of the joint ventures based on
borrowing rates for similar types of borrowing arrangements with the same remaining maturity. Considerable judgment by
management is applied when determining whether an equity investment in an unconsolidated entity is impaired and, if so, the
amount of the impairment. Changes to assumptions regarding cash flows, discount rates, or capitalization rates could be
material to our consolidated financial statements.
As a result of our impairment testing, we recorded non-cash impairment provisions of $0.4 million and $9.6 million in 2012
and 2011, respectively. These amounts related to the other-than-temporary declines in the fair market value of various equity
investments in our unconsolidated joint ventures. Refer to Note 6 of the notes to the consolidated financial statements for more
information.
35
Contractual Obligations
The following are our contractual cash obligations as of December 31, 2012:
Contractual Obligations
Total
Mortgages and notes payable:
Payments due by period
Less than 1
year
1-3 years
(In thousands)
3-5 years
More than
5 years
Scheduled amortization
$
17,328
$
4,326
$
8,928
$
2,887
$
1,187
Payments due at maturity
Total mortgages and notes payable (1)
Interest expense (2)
Employment contracts
Capital lease (3)
Operating leases
Construction commitments
Total contractual obligations
523,936
541,264
158,608
641
6,632
4,065
5,523
13,033
17,359
25,102
641
677
658
5,523
142,866
151,794
63,444
5,955
1,509
-
312,047
314,934
27,392
-
-
956
-
55,990
57,177
42,670
-
-
942
-
$
716,733
$
49,960
$
222,702
$
343,282
$
100,789
(1) Excludes $17,000 of unamortized mortgage debt premium.
(2) Variable rate debt interest is calculated using rates at December 31, 2012, excluding the effect of interest rate swaps.
(3) 99 year ground lease expires September 2103. However, an anchor tenant’s exercise of its option to purchase its parcel in October 2014 would require us
to purchase the real estate that is subject to the ground lease.
We anticipate that the combination of cash on hand, cash provided from operating activities, the availability under our credit
facility ($198.8 million at December 31, 2012 subject to covenants), our access to the capital markets and the sale of existing
properties will satisfy our expected working capital requirements through at least the next 12 months. Although we believe that
the combination of factors discussed above will provide sufficient liquidity, no assurance can be given.
At December 31, 2012, we did not have any contractual obligations that required or allowed settlement, in whole or in part,
with consideration other than cash.
Mortgages and notes payable
See the analysis of our debt included in “Liquidity and Capital Resources” above.
Employment Contracts
At December 31, 2012, we had employment contracts with our Chief Executive Officer and Chief Financial Officer that contain
minimum guaranteed compensation. All other employees are subject to at-will employment.
Operating and Capital Leases
We lease office space for our corporate headquarters under an operating lease. We also have an operating lease adjacent to our
former Taylors Square shopping center and a capital ground lease at our Gaines Marketplace shopping center that provides the
option to purchase the land parcel in October 2014 for approximately $5.0 million.
Construction Costs
In connection with the development and expansion of various shopping centers as of December 31, 2012, we have entered into
agreements for construction activities with an aggregate cost of approximately $5.5 million.
36
Planned Capital Spending
We are focused on our core strength of enhancing the value of our existing portfolio of shopping centers through successful
leasing efforts and the completion of our redevelopment projects currently in process. In addition, in 2012 we spent $150.0
million in connection with the acquisition of eight properties and approximately 26 acres of land.
For 2013, we anticipate spending approximately $36.2 million for capital expenditures which includes development costs of
approximately $18.7 million (of which $4.2 million is reflected in the construction commitments in the above contractual
obligations table) and approximately $17.5 million for redevelopment projects, tenant improvements, and leasing costs.
Capitalization
At December 31, 2012 our total market capitalization was $1.3 billion. Our market capitalization consisted of $543.1 million
of net debt (including property-specific mortgages, an unsecured credit facility consisting of a revolving line of credit and term
loan, an additional unsecured term loan, junior subordinated notes and a capital lease obligation), $681.7 million of common
shares and OP Units (including dilutive securities and based on a market price of $13.31 at December 31, 2012), and $107.9
million of convertible perpetual preferred shares (based on a market price of $53.96 per share at December 31, 2012). Our net
debt to total market capitalization was 40.7% at December 31, 2012, as compared to 51.0% at December 31, 2011. The
increase in total net debt to market capitalization was due primarily to the impact of the May 2012 common equity offering and
by the increase in our common share price from $9.83 at December 31, 2011 to $13.31 at December 31, 2012. Our outstanding
debt at December 31, 2012 had a weighted average interest rate of 4.7%, and consisted of $456.3 million of fixed rate debt,
including the impact of interest rate swap agreements. Outstanding letters of credit issued under the credit facility totaled
approximately $1.2 million at December 31, 2012.
At December 31, 2012, the noncontrolling interest in the Operating Partnership represented a 4.6% ownership in the Operating
Partnership. The OP Units may, under certain circumstances, be exchanged for our common shares of beneficial interest on a
one-for-one basis. We, as sole general partner of the Operating Partnership, have the option, but not the obligation, to settle
exchanged OP Units held by others in cash based on the current trading price of our common shares of beneficial interest.
Assuming the exchange of all OP Units, there would have been 50,832,323 of our common shares of beneficial interest
outstanding at December 31, 2012, with a market value of approximately $676.6 million.
Funds From Operations
We consider funds from operations, also known as (“FFO”), to be an appropriate supplemental measure of the financial
performance of an equity REIT. Under the NAREIT definition, FFO represents net income available to common shareholders,
excluding extraordinary items, as defined under accounting principles generally accepted in the United States of America
(“GAAP”), gains (losses) on sales of depreciable property, plus real estate related depreciation and amortization (excluding
amortization of financing costs), and after adjustments for unconsolidated partnerships and joint ventures. In addition, in
October 2011, NAREIT clarified its definition of FFO to exclude impairment provisions on depreciable property and equity
investments in depreciable property. Management has restated FFO for prior periods accordingly.
Also, we consider “FFO, excluding items above” a meaningful, additional measure of financial performance because it
excludes periodic items such as impairment provisions on land available for sale, bargain purchase gains, and gains or losses on
extinguishment of debt that are not adjusted under the current NAREIT definition of FFO. FFO and “FFO, excluding items
above” should not be considered alternatives to GAAP net income available to common shareholders or as alternatives to cash
flow as measures of liquidity.
While we consider FFO and “FFO, excluding items above” useful measures for reviewing our comparative operating and
financial performance between periods or to compare our performance to different REITs, our computations of FFO and “FFO,
excluding items above” may differ from the computations utilized by other real estate companies, and therefore, may not be
comparable to these other real estate companies.
We recognize the limitations of FFO and “FFO, excluding items above” when compared to GAAP net income available to
common shareholders. FFO and “FFO, excluding items above” do not represent amounts available for needed capital
replacement or expansion, debt service obligations, or other commitments and uncertainties. In addition, FFO and “FFO,
excluding items above” do not represent cash generated from operating activities in accordance with GAAP and are not
necessarily indicative of cash available to fund cash needs, including the payment of dividends. FFO and “FFO, excluding
items above” are simply used as additional indicator of our operating performance. The following table illustrates the
calculations of FFO and “FFO, excluding items above”:
37
2012
Years Ended December 31,
2011
(In thousands, except per share data)
2010
Net loss available to common shareholders
Adjustments:
Rental property depreciation and amortization expense
Pro-rata share of real estate depreciation from unconsolidated joint ventures
(Gain) loss on sale of depreciable real estate
Loss (gain) on sale of joint venture depreciable real estate (1)
Provision for impairment on income-producing properties (2)
Provision for impairment on equity investments in unconsolidated joint ventures
Provision for impairment on joint venture income-producing properties (1)
Deferred gain recognized upon acquisition of real estate
Noncontrolling interest in Operating Partnership
$
(46)
$
(32,002)
$
(20,148)
39,240
6,584
(336)
75
2,355
386
50
(845)
353
36,271
9,310
(7,197)
(2,718)
16,332
9,611
1,644
-
(1,742)
31,213.00
6,798.00
241
-
-
2,653
1,820
-
(1,632)
Funds from operations
$
47,816
$
29,509
$
20,945
Provision for impairment for land available for sale
Bargain purchase gain on acquisition of real estate
(Gain) loss on extinguishment of debt
Gain on extinguishment of joint venture debt, net of RPT expenses (1)(3)
Funds from operations, excluding items above
1,387
-
-
11,468
-
750
28,787
(9,836)
-
(178)
49,025
$
-
41,727
$
-
39,896
$
Weighted average common shares
Shares issuable upon conversion of Operating Partnership Units
Dilutive effect of securities
Weighted average equivalent shares outstanding, diluted
44,101
2,509
384
46,994
38,466
2,785
145
41,396
35,046
2,902
178
38,126
Funds from operations per diluted share
$ 1.02
$ 0.71
$ 0.55
Funds from operations, excluding items above, per diluted share
$ 1.04
$ 1.01
$ 1.05
(1) Amount included in earnings from unconsolidated joint ventures
(2) The twelve months ended December 31, 2012 amount includes $1.9 million which represents our proportionate ownership share of the
total for one property that was previously held in a consolidated partnership. In June 2012, the partnership completed a deed-in-lieu
transfer to the lender in exchange for full release under its mortgage loan obligation in the amount of $8.5 million.
(3) The twelve months ended December 31, 2012 amount includes RPT's costs associated with the liquidation of two joint ventures
concurrent with the extinguishment of their debt.
Inflation
Inflation has been relatively low in recent years and has not had a significant detrimental impact on the results of our
operations. Should inflation rates increase in the future, substantially all of our tenant leases contain provisions designed to
partially mitigate the negative impact of inflation in the near term. Such lease provisions include clauses that require our
tenants to reimburse us for real estate taxes and many of the operating expenses we incur. Also, many of our leases provide for
periodic increases in base rent which are either of a fixed amount or based on changes in the consumer price index and/or
percentage rents (where the tenant pays us rent based on a percentage of its sales). Significant inflation rate increases over a
prolonged period of time may have a material adverse impact on our business.
Recent Accounting Pronouncements
In May 2011, the FASB updated ASC 820 “Fair Value Measurements and Disclosures” with ASU 2011-04 “Amendments to
Achieve Common Fair Value Measurements and Disclosure Requirements in U.S. GAAP and IFRS”. The amendments change
the wording used to describe many of the requirements in U.S. GAAP for measuring fair value and for disclosing information
about fair value measurements. This standard is to be applied prospectively and is effective for fiscal years, and interim periods
38
within those years, beginning after December 15, 2011. We adopted this standard in the first quarter 2012 and it did not have a
material impact on our consolidated financial statements.
In June 2011, the FASB updated ASC 220 “Comprehensive Income” with ASU 2011-05 “Presentation of Comprehensive
Income”, which requires an entity to present the total of comprehensive income, the components of net income, and the
components of other comprehensive income either in a single continuous statement of comprehensive income or in two
separate but consecutive statements. This standard is to be applied retrospectively and is effective for fiscal years, and interim
periods within those years, beginning after December 15, 2011. In December 2011, the FASB deferred portions of this update
in its issuance of ASU 2011-12, “Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of
Items Out of Accumulated Other Comprehensive Income.” ASU 2011-12 supersedes certain pending paragraphs in Update
2011-05. The amendments are being made to allow the FASB time to re-deliberate whether or not to present on the face of the
financial statements the effects of reclassifications out of accumulated other comprehensive income on the components of net
income and other comprehensive income for all periods presented. The new disclosures in this standard did not have a material
impact on our results of operations or financial position, other than the presentation of comprehensive income.
In September 2011, the FASB updated ASC 350 “Intangibles – Goodwill and Other” with ASU 2011-08 “Testing Goodwill for
Impairment.” Under this update, an entity has the option to first assess qualitative factors to determine whether the existence of
events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than
its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is not more likely than not
that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is
unnecessary. This standard is effective for fiscal years beginning after December 15, 2011. We adopted this standard in the
first quarter 2012 and it did not have a material impact on our consolidated financial statements.
In December 2011, the FASB updated ASC 210 “Balance Sheet” with ASU 2011-11 “Disclosures about Offsetting Assets and
Liabilities.” Under this update companies are required to provide new disclosures about offsetting and related arrangements for
financial instruments and derivatives. The provisions of ASU 2011-11 are effective for annual reporting periods beginning on
or after January 1, 2013, and are required to be applied retrospectively. We do not expect this update to have a material impact
on our consolidated financial statements.
In December 2011, the FASB updated ASC 220 “Comprehensive Income” with ASU 2011-12 “Deferral of the Effective Date
for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU
2011-05.” This update requires that all non-owner changes in stockholders’ equity be presented in either a single continuous
statement of comprehensive income or in two separate but consecutive statements. ASU 2011-12 defers only those changes in
ASU 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income.
The provisions of ASU 2011-12 are effective for public companies in fiscal years beginning after December 15, 2011.
The disclosures in this standard did not have a material impact on our results of operations or financial position, other than the
presentation of comprehensive income.
In July 2012 the FASB updated ASC 350 “Intangibles – Goodwill and Other – Testing Indefinite-Lived Intangible Assets for
Impairment” with ASU 2012-02. This update amends the procedures for testing the impairment of indefinite-lived intangible
assets by permitting an entity to first assess qualitative factors to determine whether the existence of events and circumstances
indicates that it is more likely than not that the indefinite-lived intangible assets are impaired. An entity’s assessment of the
totality of events and circumstances and their impact on the entity’s indefinite-lived intangible assets will then be used as a
basis for determining whether it is necessary to perform the quantitative impairment test as described in ASC 350-30. ASU
2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012,
with early adoption permitted. We adopted this standard in the fourth quarter 2012 and it did not have a material impact on our
consolidated financial statements.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
We have exposure to interest rate risk on our variable rate debt obligations. Based on market conditions, we may manage our
exposure to interest rate risk by entering into interest rate swap agreements to hedge our variable rate debt. We are not subject
to any foreign currency exchange rate risk or commodity price risk, or other material rate or price risks. Based on our debt and
interest rates and interest rate swap agreements in effect at December 31, 2012, a 100 basis point change in interest rates would
impact our future earnings and cash flows by approximately $0.9 million annually. We believe that a 100 basis point increase
in interest rates would decrease the fair value of our total outstanding debt by approximately $6.2 million at December 31,
2012.
39
We had interest rate swap agreements with an aggregate notional amount of $135.0 million as of December 31, 2012. The
agreements provided for fixed rates ranging from 1.2% to 2.0% and had expirations ranging from April 2016 to October 2018.
The following table sets forth information as of December 31, 2012 concerning our long-term debt obligations, including
principal cash flows by scheduled maturity, weighted average interest rates of maturing amounts and fair market:
2013
2014
2015
2016
(In thousands)
2017
Thereafter
Total
Fair
Value
Fixed-rate debt
$
13,379
$
30,596
$
76,683
$
3,149
$
185,000
$
147,457
$
456,264
$
455,444
Average interest rate
Variable-rate debt
Average interest rate
5.9%
5.5%
5.3%
6.6%
4.7%
5.7%
5.2%
5.2%
$
-
$
-
$
-
$
40,000
$
45,000
$
-
$
85,000
$
85,000
0.0%
0.0%
0.0%
1.9%
1.9%
0.0%
1.9%
1.9%
We estimated the fair value of our fixed rate mortgages using a discounted cash flow analysis, based on borrowing rates for
similar types of borrowing arrangements with the same remaining maturity. Considerable judgment is required to develop
estimated fair values of financial instruments. The table incorporates only those exposures that exist at December 31, 2012 and
does not consider those exposures or positions which could arise after that date or firm commitments as of such date.
Therefore, the information presented therein has limited predictive value. Our actual interest rate fluctuations will depend on
the exposures that arise during the period and on market interest rates at that time.
Item 8. Financial Statements and Supplementary Data.
Our consolidated financial statements and supplementary data are included as a separate section in this Annual Report on Form
10-K commencing on page F-1 and are incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
None.
Item 9A. Controls and Procedures
Disclosure Controls and Procedures
We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in our reports
under the Securities Exchange Act of 1934, as amended (“Exchange Act”), such as this report on Form 10-K, is recorded,
processed, summarized and reported within the time periods specified in the SEC rules and forms, and that such information is
accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as
appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and
procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide
only reasonable assurance of achieving the design control objectives, and management was required to apply its judgment in
evaluating the cost-benefit relationship of possible controls and procedures.
We carried out an assessment as of December 31, 2012 of the effectiveness of the design and operation of our disclosure
controls and procedures. This assessment was done under the supervision and with the participation of management, including
our Chief Executive Officer and Chief Financial Officer. Based on such evaluation, our management, including our Chief
Executive Officer and Chief Financial Officer, concluded that such disclosure controls and procedures were effective at the
reasonable assurance level as of December 31, 2012.
40
Management’s Report on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining effective internal control over financial reporting as such term is
defined under Rule 13a-15(f) promulgated under the Securities Exchange Act of 1934, as amended.
Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and preparation of our consolidated financial statements for external purposes in accordance with generally
accepted accounting principles.
Internal control over financial reporting includes those policies and procedures that pertain to our ability to record, process,
summarize and report reliable financial data. Management recognizes that there are inherent limitations in the effectiveness of
any internal control and effective internal control over financial reporting can provide only reasonable assurance with respect to
financial statement preparation. Additionally, because of changes in conditions, the effectiveness of internal control over
financial reporting may vary over time.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our management conducted an assessment of our internal controls over financial reporting as of December 31, 2012 using the
framework established by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control –
Integrated Framework. Based on this assessment, management has concluded that our internal control over financial reporting
was effective as of December 31, 2012.
Our independent registered public accounting firm, Grant Thornton LLP, has issued an attestation report on our internal control
over financial reporting. Their report appears below.
41
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of Trustees and Shareholders
Ramco-Gershenson Properties Trust
We have audited the internal control over financial reporting of Ramco-Gershenson Properties Trust (a Maryland corporation)
and subsidiaries (the “Company”) as of December 31, 2012, based on criteria established in Internal Control—Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s
management is responsible for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal
Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial
reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal
control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of
internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of
December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by COSO.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States),
the consolidated financial statements of the Company as of and for the year ended December 31, 2012 and our report dated
February 26, 2013 expressed an unqualified opinion on those financial statements.
/s/ GRANT THORNTON LLP
Southfield, Michigan
February 26, 2013
42
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting during the most recently completed fiscal quarter
that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information.
None.
Item 10. Directors, Executive Officers and Corporate Governance.
PART III
Incorporated by reference from our definitive proxy statement to be filed within 120 days after the end of our fiscal year
covered by this Form 10-K.
Item 11. Executive Compensation.
Incorporated by reference from our definitive proxy statement to be filed within 120 days after the end of our fiscal year
covered by this Form 10-K.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth information regarding our equity compensations plans as of December 31, 2012:
Plan Category
(A)
Number of securities to be
issued upon exercise of
outstanding options,
warrants and rights
(B)
Weighted-average
exercise price of
outstanding options,
warrants and rights
(C)
Number of securities
remaining available for
future issuances under
equity compensation plans
(excluding securities
reflected in column (A))
Equity compensation plans
approved by security
holders
Equity compensation plans
not approved by security
holders
468,831
$30.05
2,020,308
-
-
-
Total
468,831
$30.05
2,020,308
The total in Column (A) above consisted of options to purchase 227,743 common shares, 52,004 deferred common shares (see
Note 16 of the notes to the consolidated financial statements for further information) and 189,084 restricted common shares
issuable on the satisfaction of applicable performance measures. The number of restricted shares overstates dilution to the
extent we do not satisfy the applicable performance measures.
Additional information required by this Item is incorporated by reference from our definitive proxy statement to be filed within
120 days after the end of our fiscal year covered by this Form 10-K.
Item 13. Certain Relationships and Related Transactions, and Director Independence.
Incorporated by reference from our definitive proxy statement to be filed within 120 days after the end of our fiscal year
covered by this Form 10-K.
Item 14. Principal Accountant Fees and Services.
Incorporated by reference from our definitive proxy statement to be filed within 120 days after the end of our fiscal year
covered by this Form 10-K.
43
PART IV
Item 15. Exhibits and Financial Statement Schedules.
(a) (1) Consolidated financial statements. See “Item 8 – Financial Statements and Supplementary Data.”
(2) Financial statement schedule. See “Item 8 – Financial Statements and Supplementary Data.”
(3) Exhibits
3.1
3.2
3.3
3.4
3.5
4.1
4.2
4.3
4.4
4.5
10.1
10.2
10.3
Articles of Restatement of Declaration of Trust of the Company, effective June 8, 2010, incorporated
by reference to Exhibit 3.1 to the Company's Form 8-K dated June 8, 2010.
Amended and Restated Bylaws of the Company, effective February 23, 2012 incorporated by
reference to Exhibit 3.1 to the Company's Form 8-K dated February 29, 2012.
Articles of Amendment, as filed with the State Department of Assessments and Taxation of Maryland
on April 5, 2012, incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K dated April 6,
2012.
Articles Supplementary, as filed with the State Department of Assessments and Taxation of Maryland
on April 5, 2012, incorporated by reference to Exhibit 3.2 to the Company’s Form 8-K dated April 6,
2012.
Articles Supplementary, as filed with the State Department of Assessments and Taxation of Maryland
on April 28, 2012, incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K dated April
28, 2012.
Amended and Restated Fixed Rate Note ($110 million), dated March 30, 2007, by and Between
Ramco Jacksonville LLC and JPMorgan Chase Bank, N.A., incorporated by reference to Exhibit 4.1
to Registrant’s Form 8-K dated April 16, 2007.
Amended and Restated Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture
Filing, dated March 30, 2007, by and between Ramco Jacksonville LLC and JPMorgan Chase Bank,
N.A., incorporated by reference to Exhibit 4.2 to Registrant’s Form 8-K dated April 16, 2007.
Assignment of Leases and Rents, dated March 30, 2007, by and between Ramco Jacksonville LLC
and JPMorgan Chase Bank, N.A., incorporated by reference to Exhibit 4.3 to Registrant’s Form 8-K
dated April 16, 2007.
Environmental Liabilities Agreement, dated March 30, 2007, by and between Ramco Jacksonville
LLC and JPMorgan Chase Bank, N.A., incorporated by reference to Exhibit 4.4 to Registrant’s Form
8-K dated April 16, 2007.
Acknowledgment of Property Manager, dated March 30, 2007 by and between Ramco-Gershenson,
Inc. and JPMorgan Chase Bank, N.A., incorporated by reference to Exhibit 4.6 to Registrant’s Form
8-K dated April 16, 2007.
Registration Rights Agreement, dated as of May 10, 1996, among the Company, Dennis Gershenson,
Joel Gershenson, Bruce Gershenson, Richard Gershenson, Michael A. Ward U/T/A dated 2/22/77, as
amended, and each of the Persons set forth on Exhibit A attached thereto, incorporated by reference
to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 1996.
Exchange Rights Agreement, dated as of May 10, 1996, by and among the Company and each of the
Persons whose names are set forth on Exhibit A attached thereto, incorporated by reference to Exhibit
10.3 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 1996.
Exchange Rights Agreement dated as of September 4, 1998 between Ramco-Gershenson Properties
Trust, and A.T.C., L.L.C., incorporated by reference to Exhibit 10.4 to the Company’s Quarterly
Report on Form 10-Q for the period ended September 30, 1998.
44
10.4
10.5
10.6
10.7
10.8
Limited Liability Company Agreement of Ramco/West Acres LLC., incorporated by reference to
Exhibit 10.53 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30,
2001.
Amended and Restated Limited Partnership Agreement of Ramco/Lion Venture LP, dated as of
December 29, 2004, by Ramco-Gershenson Properties, L.P., as a limited partner, Ramco Lion LLC,
as a general partner, CLPF-Ramco, L.P. as a limited partner, and CLPF-Ramco GP, LLC as a general
partner, incorporated by reference Exhibit 10.62 to the Registrant’s Annual Report on Form 10-K for
the year ended December 31, 2004.
Second Amended and Restated Limited Liability Company Agreement of Ramco Jacksonville LLC,
dated March 1, 2005, by Ramco-Gershenson Properties , L.P. and SGC Equities LLC., incorporated
by reference Exhibit 10.65 to the Registrant’s Quarterly Report on Form 10-Q for the period ended
March 31, 2005.
Employment Agreement, dated as of August 1, 2007, between the Company and Dennis Gershenson,
incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the
period ended June 30, 2007.**
Restricted Share Award Agreement Under 2008 Restricted Share Plan for Non-Employee Trustee,
incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the
period ended June 30, 2008.**
10.9*
Summary of Trustee Compensation Program.**
10.10
10.11
10.12
10.13
10.14
10.15
10.16
10.17
10.18
Restricted Share Plan for Non-Employee Trustees, incorporated by reference to Appendix A of the
Company’s 2008 Proxy Statement filed on April 30, 2008.**
Ramco-Gershenson Properties Trust 2009 Omnibus Long-Term Incentive Plan, incorporated by
reference to Exhibit 10.1 to Registrant’s Form 8-K, dated June 15, 2009. **
Separation Agreement and Release between Ramco-Gershenson Properties Trust and Richard J.
Smith, dated December 23, 2009, incorporated by reference to Exhibit 10.1 to Registrant’s Form 8-K,
dated December 29, 2009.
Employment Letter, dated February 16, 2010, between Ramco-Gershenson Properties Trust and
Gregory R. Andrews, incorporated by reference to Exhibit 10.1 to Registrant’s Form 8-K, dated
February 19, 2010.**
Change in Control Policy, dated March 1, 2010, incorporated by reference to Exhibit 10.1 to
Registrant’s Form 8-K dated March 4, 2010.
Registration Rights Agreement, dated February 17, 2010, between Ramco-Gershenson Properties
Trust and JCP Realty, Inc., incorporated by reference to Exhibit 10.28 to the Registrant's Annual
Report on Form 10-K for the year ended December 31, 2009.
Form of Non-Qualified Option Agreement Under 2009 Omnibus Long-Term Incentive Plan,
incorporated by reference to Exhibit 10.1 to Registrant’s Form 8-K dated June 15, 2009**
Form of Restricted Stock Award Agreement Under 2009 Omnibus Long-Term Incentive Plan,
incorporated by reference to Exhibit 10.1 to Registrant’s Form 8-K dated June 15, 2009**
Unsecured Term Loan Agreement, dated as of September 30, 2011 among Ramco-Gershenson
Properties, L.P., as Borrower, Ramco-Gershenson Properties Trust, as Guarantor, KeyBank National
Association, The Huntington National Bank, PNC Bank, National Association, KeyBank National
Association, as Agent, and KeyBanc Capital Markets, as Sole Lead Manager and Arranger
incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the
period ended September 30, 2011.
10.19
Unconditional Guaranty of Payment and Performance, dated as of September 30, 2011, by Ramco-
Gershenson Properties Trust, in favor of KeyBank National Association and the other lenders under
the Unsecured Term Loan Agreement incorporated by reference to Exhibit 10.2 to the Company’s
45
Quarterly Report on Form 10-Q for the period ended September 30, 2011.
10.20
10.21
2012 Executive Incentive Plan, dated January 12, 2012, incorporated by reference to Exhibit 10.1 to
the Company’s Current Report on Form 8-K dated January 13, 2012.
Third Amended and Restated Unsecured Master Loan Agreement dated as of July 19, 2012 among
Ramco-Gershenson Properties, L.P., as Borrower, Ramco-Gershenson Properties Trust, as a
Guarantor, KeyBank National Association, as a Bank, the Other Banks which are a Party to this
Agreement, the Other Banks which may become Parties to this Agreement, KeyBank National
Association, as Agent, KeyBanc Capital Markets, as Sole Lead Manager and Arranger, JPMorgan
Chase Bank, N.A. and Bank of America, N.A. as Co-Syndication Agents, and Deutsche Bank
Securities Inc. and PNC Bank, National Association, as Co Documentation Agents incorporated by
reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q ended June 30, 2012.
10.22
Third Amended and Restated Unconditional Guaranty of Payment and Performance, dated as of July
19, 2012 by Ramco-Gershenson Properties Trust, as Guarantor, in favor of KeyBank National
Association and certain other lenders incorporated by reference to Exhibit 10.2 to the Company’s
Quarterly Report on Form 10-Q ended June 30, 2012.
12.1*
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Share Dividends.
21.1*
Subsidiaries
23.1*
Consent of Grant Thornton LLP.
31.1*
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS(1) XBRL Instance Document
101.SCH(1) XBRL Taxonomy Extension Schema
101.CAL(1) XBRL Extension Calculation
101.DEF(1)
XBRL Extension Definition
101.LAB(1)
XBRL Taxonomy Extension Label
101.PRE(1)
XBRL Taxonomy Extension Presentation
__________
* Filed herewith
** Management contract or compensatory plan or arrangement
(1) Pursuant to Rule 406T of Regulations S-T, these interactive data files are deemed not filed or part of a registration statement
or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Sections 18
of the Securities Exchange Act of 1924 and otherwise are not subject to liability thereunder.
15(b) The exhibits listed at item 15(a)(3) that are noted ‘filed herewith’ are hereby filed with this report.
15(c) The financial statement schedules listed at Item 15(a)(2) are hereby filed with this report.
46
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: February 26, 2013
Ramco-Gershenson Properties Trust
By: /s/ Dennis E. Gershenson
Dennis E. Gershenson,
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on
behalf of registrant and in the capacities and on the dates indicated.
Dated: February 26, 2013
By: /s/ Stephen R. Blank
Stephen R. Blank,
Chairman
Dated: February 26, 2013
By: /s/ Dennis E. Gershenson
Dennis E. Gershenson,
Trustee, President and Chief Executive Officer
(Principal Executive Officer)
Dated: February 26, 2013
Dated: February 26, 2013
Dated: February 26, 2013
Dated: February 26, 2013
Dated: February 26, 2013
Dated: February 26, 2013
Dated: February 26, 2013
Dated: February 26, 2013
By: /s/ Arthur H. Goldberg
Arthur H. Goldberg,
Trustee
By: /s/ Robert A. Meister
Robert A. Meister,
Trustee
By: /s/ David J. Nettina
David J. Nettina,
Trustee
By: /s/ Matthew L. Ostrower
Matthew L. Ostrower,
Trustee
By: /s/ Joel M. Pashcow
Joel M. Pashcow,
Trustee
By: /s/ Mark K. Rosenfeld
Mark K. Rosenfeld,
Trustee
By: /s/ Michael A. Ward
Michael A. Ward,
Trustee
By: /s/ Gregory R. Andrews
Gregory R. Andrews,
Chief Financial Officer and Secretary
(Principal Financial and Accounting Officer)
47
RAMCO-GERSHENSON PROPERTIES TRUST
Index to Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm
Consolidated Financial Statements:
Consolidated Balance Sheets - December 31, 2012 and 2011
Consolidated Statements of Operations and Comprehensive Income - Years Ended
December 31, 2012, 2011, and 2010
Consolidated Statements of Shareholders’ Equity - Years Ended December 31, 2012, 2011, and 2010
Consolidated Statements of Cash Flows – Years Ended December 31, 2012, 2011, and 2010
Notes to Consolidated Financial Statements
Schedule to Consolidated Financial Statements
Page
F-2
F-3
F-4
F-5
F-6
F-7
F-31
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of Trustees and Shareholders
Ramco-Gershenson Properties Trust
We have audited the accompanying consolidated balance sheets of Ramco-Gershenson Properties Trust (a Maryland
corporation) and subsidiaries (the “Company”) as of December 31, 2012 and 2011, and the related consolidated statements of
operations and comprehensive income (loss), shareholders’ equity, and cash flows for each of the three years in the period
ended December 31, 2012. Our audits of the basic financial statements included the financial statement schedule listed in the
index appearing under Item 15. These financial statements and financial statement schedule are the responsibility of the
Company’s management. Our responsibility is to express an opinion on these financial statements and financial statement
schedule based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial
position of Ramco-Gershenson Properties Trust and subsidiaries as of December 31, 2012 and 2011, and the results of their
operations and their cash flows for each of the three years in the period ended December 31, 2012 in conformity with
accounting principles generally accepted in the United States of America. Also, in our opinion, the related financial statement
schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material
respects, the information set forth therein.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States),
the Company’s internal control over financial reporting as of December 31, 2012, based on criteria established in Internal
Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)
and our report dated February 26, 2013 expressed an unqualified opinion.
/s/GRANT THORNTON LLP
Southfield, Michigan
February 26, 2013
F-2
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
ASSETS
Income producing properties, at cost:
Land
Buildings and improvements
Less accumulated depreciation and amortization
Income producing properties, net
Construction in progress and land held for development or sale
Net real estate
Equity investments in unconsolidated joint ventures
Cash and cash equivalents
Restricted cash
Accounts receivable, net
Note receivable
Other assets, net
TOTAL ASSETS
LIABILITIES AND SHAREHOLDERS' EQUITY
Mortgages and notes payable:
Mortgages payable
Unsecured revolving credit facility
Unsecured term loan facilities
Junior subordinated notes
Total mortgages and notes payable
Capital lease obligation
Accounts payable and accrued expenses
Other liabilities
Distributions payable
TOTAL LIABILITIES
Commitments and Contingencies
Ramco-Gershenson Properties Trust ("RPT") Shareholders' Equity:
Preferred shares, $0.01 par, 2,000 shares authorized: 7.25% Series D
Cumulative Convertible Perpetual Preferred Shares, (stated at liquidation
preference $50 per share), 2,000 shares issued and outstanding as of
December 31, 2012 and December 31, 2011
Common shares of beneficial interest, $0.01 par, 80,000 shares authorized,
48,489 and 38,735 shares issued and outstanding as of December 31, 2012
and 2011, respectively
Additional paid-in capital
Accumulated distributions in excess of net income
Accumulated other comprehensive loss
TOTAL SHAREHOLDERS' EQUITY ATTRIBUTABLE TO RPT
Noncontrolling interest
TOTAL SHAREHOLDERS' EQUITY
December 31,
2012
2011
$
166,500
952,671
(237,462)
881,709
98,541
$
133,145
863,763
(222,722)
774,186
87,549
980,250
95,987
4,233
3,892
7,976
-
72,953
1,165,291
$
861,735
97,020
12,155
6,063
9,614
3,000
59,236
1,048,823
$
$
293,156
40,000
180,000
28,125
541,281
6,023
21,589
26,187
10,379
605,459
$
325,887
29,500
135,000
28,125
518,512
6,341
18,662
15,528
8,606
567,649
$
100,000
$
100,000
485
387
683,609
(249,070)
(5,241)
529,783
30,049
559,832
570,225
(218,888)
(2,649)
449,075
32,099
481,174
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
1,165,291
$
1,048,823
The accompanying notes are an integral part of these consolidated financial statements.
F-3
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(In thousands, except per share amounts)
REVENUE
Minimum rent
Percentage rent
Recovery income from tenants
Other property income
Management and other fee income
TOTAL REVENUE
EXPENSES
Real estate taxes
Recoverable operating expense
Other non-recoverable operating expense
Depreciation and amortization
General and administrative expense
TOTAL EXPENSES
INCOME BEFORE OTHER INCOME AND EXPENSES, TAX AND DISCONTINUED OPERATIONS
OTHER INCOME AND EXPENSES
Other expense, net
Gain on sale of real estate
Earnings (loss) from unconsolidated joint ventures
Interest expense
Amortization of deferred financing fees
Provision for impairment
Provision for impairment on equity investments in unconsolidated joint ventures
Bargain purchase gain on acquisition of real estate
Deferred gain recognized upon acquisition of real estate
Loss on extinguishment of debt
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAX
Income tax benefit (provision)
INCOME (LOSS) FROM CONTINUING OPERATIONS
DISCONTINUED OPERATIONS
Gain (loss) on sale of real estate
Gain (loss) on extinguishment of debt
Provision for impairment
Income (loss) from discontinued operations
LOSS FROM DISCONTINUED OPERATIONS
NET INCOME (LOSS)
Net loss attributable to noncontrolling partner interest
NET INCOME (LOSS) ATTRIBUTABLE TO RPT
Preferred share dividends
NET LOSS AVAILABLE TO COMMON SHAREHOLDERS
(LOSS) EARNINGS PER COMMON SHARE, BASIC
Continuing operations
Discontinued operations
(LOSS) EARNINGS PER COMMON SHARE, DILUTED
Continuing operations
Discontinued operations
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic
Diluted
OTHER COMPREHENSIVE INCOME
Net income (loss)
Other comprehensive income:
(Loss) gain on interest rate swaps
Comprehensive income (loss)
Comprehensive loss (income) attributable to noncontrolling interest
COMPREHENSIVE INCOME ATTRIBUTABLE TO RPT
The accompanying notes are an integral part of these condensed consolidated financial statements.
F-4
Year Ended December 31,
2011
2012
2010
$
90,354
601
31,664
2,055
4,064
128,738
$
79,440
244
29,673
4,091
4,126
117,574
$
73,006
354
27,104
2,980
4,192
107,636
17,076
15,879
2,838
39,479
19,445
94,717
34,021
(66)
69
3,248
(25,895)
(1,449)
(1,766)
(386)
-
845
-
8,621
34
8,655
336
307
(2,536)
330
(1,563)
16,452
14,404
3,540
34,594
19,646
88,636
28,938
(257)
231
1,669
(27,636)
(1,861)
(16,917)
(9,611)
-
-
(1,968)
(27,412)
(795)
(28,207)
9,406
1,218
(10,883)
(34)
(293)
15,052
13,561
2,420
29,344
18,988
79,365
28,271
(973)
2,096
(221)
(30,268)
(2,602)
(28,787)
(2,653)
9,836
1,796
-
(23,505)
670
(22,835)
(2,050)
(242)
-
1,403
(889)
7,092
112
7,204
(7,250)
(46)
$
(28,500)
1,742
(26,758)
(5,244)
(32,002)
$
(23,724)
3,576
(20,148)
-
(20,148)
$
$
0.03
(0.03)
$
-
$
0.03
(0.03)
$
-
44,101
44,485
$
$
$
$
$
$
$
$
(0.83)
(0.01)
(0.84)
(0.83)
(0.01)
(0.84)
(0.55)
(0.02)
(0.57)
(0.55)
(0.02)
(0.57)
38,466
38,466
.
35,046
35,046
$
7,092
$
(28,500)
$
(23,724)
(2,745)
4,347
153
4,500
$
(2,828)
(31,328)
179
(31,149)
$
2,517
(21,207)
(3,207)
(24,414)
$
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(In thousands, except share amounts)
Shareholders' Equity of Ramco-Gershenson Properties Trust
Preferred
Shares
Common
Shares
Additional
Paid-in
Capital
Accumulated
Distributions in
Excess of Net
Income
Accumulated
Other
Comprehensive
Income (Loss)
Noncontrolling
Interest
Total
Shareholders’
Equity
$
$
$
$
Balance, December 31, 2009
Issuance of common shares
Conversion and redemption of OP unit holders
Share-based compensation and other expense
Dividends declared to common shareholders
Distributions declared to noncontrolling interests
Dividends paid on restricted shares
Consolidation of variable interest entity
Other comprehensive income adjustment
Net loss
Balance, December 31, 2010
Issuance of common shares
Issuance of preferred shares
Conversion and redemption of OP unit holders
Share-based compensation and other expense
Dividends declared to common shareholders
Dividends declared to preferred shareholders
Distributions declared to noncontrolling interests
Dividends paid on restricted shares
Purchase of partner's interest in consolidated variable inte
Other comprehensive loss adjustment
Net loss
Balance, December 31, 2011
Issuance of common shares
Conversion and redemption of OP unit holders
Share-based compensation and other expense
Dividends declared to common shareholders
Dividends declared to preferred shareholders
Distributions declared to noncontrolling interests
Dividends declared to deferred shares
Other comprehensive income adjustment
Net income (loss)
Balance, December 31, 2012
-
$
-
-
-
-
-
-
-
-
-
-
-
100,000
-
-
-
-
-
-
-
-
-
100,000
-
$
-
-
-
-
-
-
-
-
100,000
$
$
309
70
-
-
-
-
-
-
-
-
379
8
-
-
-
-
-
-
-
-
-
-
387
$
98
-
-
-
-
-
-
-
-
485
$
486,731
75,623
-
1,016
-
-
-
-
-
-
563,370
8,329
(3,358)
-
1,884
-
-
-
-
-
-
-
570,225
111,370
-
2,014
-
-
-
-
-
-
683,609
(117,663)
-
-
-
(23,498)
-
(167)
-
-
(20,148)
(161,476)
-
-
-
-
(25,203)
(5,244)
-
(207)
-
-
(26,758)
(218,888)
-
(2,149)
-
-
-
-
-
-
-
2,149
-
-
-
-
-
-
-
-
-
-
-
(2,649)
-
(2,649)
-
$
39,337
-
(41)
-
-
(1,895)
-
2,900
368
(3,576)
37,093
-
-
(3)
-
-
-
(2,077)
-
(993)
(179)
(1,742)
32,099
-
(3)
-
-
-
(1,782)
-
(153)
(112)
30,049
406,565
75,693
(41)
1,016
(23,498)
(1,895)
(167)
2,900
2,517
(23,724)
439,366
8,337
96,642
(3)
1,884
(25,203)
(5,244)
(2,077)
(207)
(993)
(2,828)
(28,500)
481,174
111,468
(3)
2,014
(29,863)
(7,250)
(1,782)
(273)
(2,745)
7,092
559,832
$
$
$
$
$
-
-
-
(29,863)
(7,250)
-
(273)
-
7,204
(249,070)
$
-
-
-
-
-
(2,592)
-
(5,241)
$
$
$
$
The accompanying notes are an integral part of these condensed consolidated financial statements.
F-5
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
OPERATING ACTIVITIES
Net income
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization, including discontinued operations
Amortization of deferred financing fees, including discontinued operations
Income tax (benefit) provision
Earnings from unconsolidated joint ventures
Distributions received from operations of unconsolidated joint ventures
Provision for impairment, including discontinued operations
Provision for impairment on equity investments in unconsolidated joint ventures
(Gain) loss on extinguishment of debt, including discontinued operations
Deferred gain recognized
Gain on sale of real estate, including discontinued operations
Bargain purchase gain on acquisition of real estate
Amortization of premium on mortgages and notes payable, net
Share-based compensation expense
Long-term incentive cash compensation expense
Changes in assets and liabilities:
Accounts receivable, net
Other assets, net
Accounts payable, accrued expenses and other liabilities
Net cash provided by operating activities
INVESTING ACTIVITIES
Acquisitions of real estate
Development and capital improvements
Net proceeds from sales of real estate
Distributions from sale of joint venture property
Decrease (increase) in restricted cash
Investment in unconsolidated joint ventures
Note repayment (receivable) from third party
Purchase of partner's equity in consolidated joint ventures
Net cash used in investing activities
FINANCING ACTIVITIES
Proceeds on mortgages and notes payable
Repayment of mortgages and notes payable
Net proceeds (repayments) on revolving credit facility
Payment of deferred financing costs
Proceeds from issuance of common shares
Proceeds from issuance of preferred shares
Repayment of capitalized lease obligation
Dividends paid to preferred shareholders
Dividends paid to common shareholders
Distributions paid to operating partnership unit holders
Net cash provided by financing activities
Net change in cash and cash equivalents
Cash from consolidated variable interest entity
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Year Ended December 31,
2011
2012
2010
$
7,092
$
(28,500)
$
(23,724)
39,822
1,454
(34)
(3,248)
3,793
4,302
386
(307)
(845)
(405)
-
(30)
2,120
445
1,128
6,349
172
62,194
37,026
1,879
795
(1,669)
4,413
27,800
9,611
750
-
(9,638)
-
(35)
1,849
-
(252)
4,577
(3,903)
44,703
$
(149,960)
(38,431)
10,292
3,587
2,171
(3,869)
3,000
-
(173,210)
$
(77,260)
(24,430)
28,803
3,756
(337)
(9,279)
-
(1,000)
(79,747)
$
45,000
(24,200)
10,500
(1,959)
111,468
-
(318)
(7,250)
(28,333)
(1,814)
103,094
$
135,586
(79,840)
(90,250)
(2,839)
8,819
96,642
(300)
(3,432)
(25,203)
(2,159)
37,024
32,026
2,663
(670)
221
2,904
28,787
2,653
242
(1,796)
(46)
(9,836)
(202)
1,279
-
5,112
3,758
(122)
43,249
(55,779)
(31,939)
4,023
-
(1,520)
(13,720)
(3,000)
-
(101,935)
46,000
(63,159)
27,714
(1,173)
75,693
-
(283)
-
(22,501)
(1,906)
60,385
(7,922)
-
12,155
4,233
$
1,980
-
10,175
12,155
$
1,699
44
8,432
10,175
$
SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITY
Conveyance of ownership interest to lender, release from mortgage obligation
$
8,501
$
9,107
$
-
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest (net of capitalized interest of $996, $325 and $1,158 in 2012, 2011 and 2010,
respectively)
Cash paid for federal income taxes
The accompanying notes are an integral part of these condensed consolidated financial statements.
$
25,686
16
$
28,747
63
$
29,746
28
F-6
RAMCO-GERSHENSON PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2012, 2011 and 2010
1. Organization and Summary of Significant Accounting Policies
Ramco-Gershenson Properties Trust, together with our subsidiaries (the “Company”), is a real estate investment trust (“REIT”)
engaged in the business of owning, developing, redeveloping, acquiring, managing and leasing community shopping centers
located predominantly in the Eastern and Midwestern regions of the United States. Our property portfolio consists of 52
wholly owned shopping centers and one office building comprising approximately 10.0 million square feet. In addition, we are
co-investor in and manager of two significant joint ventures that own portfolios of shopping centers. We own 30% of
Ramco/Lion Venture L.P., an entity that owns 15 shopping centers comprising approximately 3.0 million square feet. We own
20% of Ramco 450 Venture LLC, an entity that owns eight shopping centers comprising approximately 1.7 million square feet.
We also have ownership interests in three smaller joint ventures that each own a shopping center. Our joint ventures are
reported using equity method accounting. We earn fees from the joint ventures for managing, leasing, and redeveloping the
shopping centers they own. We also own interests in three parcels of land held for development and five parcels of land
adjacent to certain of our existing developed properties located in Florida, Georgia, Michigan, Tennessee, and Virginia.
We made an election to qualify as a REIT for federal income tax purposes. Accordingly, we generally will not be subject to
federal income tax, provided that we annually distribute at least 90% of our taxable income to our shareholders and meet other
conditions.
Principles of Consolidation and Estimates
The consolidated financial statements include the accounts of us and our majority owned subsidiary, the Operating Partnership,
Ramco-Gershenson Properties, L.P. (95.4%, 93.7%, and 92.9% owned by us at December 31, 2012, 2011 and 2010,
respectively), and all wholly-owned subsidiaries, including entities in which we have a controlling interest or have been
determined to be the primary beneficiary of a variable interest entity (“VIE”). The presentation of consolidated financial
statements does not itself imply that assets of any consolidated entity (including any special-purpose entity formed for a
particular project) are available to pay the liabilities of any other consolidated entity, or that the liabilities of any other
consolidated entity (including any special-purpose entity formed for a particular project) are obligations of any other
consolidated entity. Investments in real estate joint ventures over which we have the ability to exercise significant influence,
but for which we do not have financial or operating control, are accounted for using the equity method of accounting.
Accordingly, our share of the earnings (loss) of these joint ventures is included in consolidated net income (loss). All
intercompany transactions and balances are eliminated in consolidation.
We own 100% of the non-voting and voting common stock of Ramco-Gershenson, Inc. (“Ramco”), and therefore it is included
in the consolidated financial statements. Ramco has elected to be a taxable REIT subsidiary for federal income tax purposes.
Ramco provides property management services to us and to other entities, including our real estate joint venture partners.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of
America (“GAAP”) requires our management to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. We base our estimates on historical experience and on various other
assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments
about the carrying values of assets and liabilities and reported amounts that are not readily apparent from other sources. Actual
results could differ from those estimates.
Sales Tax
We collect various taxes from tenants and remit these amounts, on a net basis, to the applicable taxing authorities.
Reclassifications
Certain reclassifications of prior period amounts have been made in the financial statements in order to conform to the 2012
presentation.
F-7
Revenue Recognition and Accounts Receivable
Our shopping center space is generally leased to retail tenants under leases that are classified as operating leases. We recognize
minimum rents using the straight-line method over the terms of the leases commencing when the tenant takes possession of the
space and when construction of landlord funded improvements is substantially complete. Certain of the leases also provide for
contingent percentage rental income which is recorded on an accrual basis once the specified target that triggers this type of
income is achieved. The leases also provide for recoveries from tenants of CAM, real estate taxes and other operating expenses.
These recoveries are estimated and recognized as revenue in the period the recoverable costs are incurred or accrued. Revenues
from fees and management income are recognized in the period in which the services have been provided and the earnings
process is complete. Lease termination income is recognized when a lease termination agreement is executed by the parties and
the tenant vacates the space. When a lease is terminated early but the tenant continues to control the space under a modified
lease agreement, the lease termination fee is generally recognized evenly over the remaining term of the modified lease
agreement.
Current accounts receivable from tenants primarily relate to contractual minimum rent, percentage rent, real estate taxes and
CAM or other operating expense reimbursements.
We provide for bad debt expense based upon the allowance method of accounting. We continuously monitor the collectability
of our accounts receivable from specific tenants, analyze historical bad debts, customer creditworthiness, current economic
trends and changes in tenant payment terms when evaluating the adequacy of the allowance for bad debts. Allowances are
taken for those balances that we have reason to believe will be uncollectible. When tenants are in bankruptcy, we make
estimates of the expected recovery of pre-petition and post-petition claims. The period to resolve these claims can exceed one
year. Management believes the allowance for doubtful accounts is adequate to absorb currently estimated bad debts. However,
if we experience bad debts in excess of the allowance we have established, our operating income would be reduced. At
December 31, 2012 and 2011, our accounts receivable were $8.0 million and $9.6 million, respectively, net of allowances for
doubtful accounts of $2.6 million and $3.5 million, respectively.
In addition, many of our leases contain non-contingent rent escalations for which we recognize income on a straight-line basis
over the non-cancelable lease term. This method results in rental income in the early years of a lease being higher than actual
cash received, creating a straight-line rent receivable asset which is included in the “Other Assets” line item in our consolidated
balance sheets. We review our unbilled straight-line rent receivable balance to determine the future collectability of revenue
that will not be billed to or collected from tenants due to early lease terminations, lease modifications, bankruptcies and other
factors. Our evaluation is based on our assessment of tenant credit risk changes indicating that expected future straight-line rent
may not be realized. Depending on circumstances, we may provide a reserve against the previously recognized straight-line
rent receivable asset for a portion, up to its full value, that we estimate may not be received. The balance of straight-line rent
receivable at December 31, 2012 and 2011, net of allowances was $14.8 million and $16.0 million, respectively and is included
in other assets on our consolidated balance sheets. To the extent any of the tenants under these leases become unable to pay
their contractual cash rents, we may be required to write down the straight-line rent receivable from those tenants, which would
reduce our operating income.
Real Estate
Real estate assets that we own directly are stated at cost less accumulated depreciation. Depreciation is computed using the
straight-line method. The estimated useful lives for computing depreciation are generally 25 – 40 years for buildings and 10 –
20 years for parking lot surfacing and equipment. We capitalize all capital improvement expenditures associated with
replacements and improvements to real property that extend its useful life and depreciate them over their estimated useful lives
ranging from 5 – 30 years. In addition, we capitalize qualifying tenant leasehold improvements and depreciate them over the
shorter of the useful life of the improvements or the term of the related tenant lease. We also capitalize direct internal and
external costs of procuring leases and amortize them over the base term of the lease. If a tenant vacates before the expiration of
its lease, we charge unamortized leasing costs and undepreciated tenant leasehold improvement of no future value to expense.
We charge maintenance and repair costs that do not extend an asset’s life to expense as incurred.
Sale of a real estate asset is recognized when it is determined that the sale has been consummated, the buyer’s initial and
continuing investment is adequate, our receivable, if any, is not subject to future subordination, and the buyer has assumed the
usual risks and rewards of ownership of the assets.
We allocate the costs of acquisitions to assets acquired and liabilities assumed based on estimated fair values, replacement costs
and appraised values. The purchase price of the acquired property is allocated to land, building, improvements and identifiable
intangibles such as in-place leases, above/below market leases, out-of-market assumed mortgages, and gain on purchase, if any.
F-8
The value allocated to above-below market leases is amortized over the related lease term and included in rental income in our
consolidated statements of operations. Should a tenant terminate its lease prior to its stated expiration, all unamortized amounts
relating to that lease would be written off.
Real estate also includes costs incurred in the development of new operating properties and the redevelopment of existing
operating properties. These properties are carried at cost and no depreciation is recorded on these assets until the
commencement of rental revenue or no later than one year from the completion of major construction. These costs include pre-
development costs directly identifiable with the specific project, development and construction costs, interest, real estate taxes
and insurance. Interest is capitalized on land under development and buildings under construction based on the weighted
average rate applicable to our borrowings outstanding during the period and the weighted average balance of qualified assets
under development/redevelopment during the period. Indirect project costs associated with development or construction of a
real estate project are capitalized until the earlier of one year following substantial completion of construction or when the
property becomes available for occupancy.
The capitalized costs associated with development and redevelopment projects are depreciated over the useful life of the
improvements. If we determine a development or redevelopment project is no longer probable, we expense all capitalized costs
which are not recoverable.
It is our policy to start vertical construction on new development projects only after the project has received entitlements,
significant anchor leasing commitments, construction financing and joint venture partner commitments, if appropriate. We are
in the entitlement and pre-leasing phases at our pre-development projects.
At December 31, 2012, we had three projects under pre-development. Our land held for development consisted of:
Development Project/Location
Costs Incurred
To Date
(In thousands)
Hartland Towne Square - Hartland Twp., MI
$
25,210
Lakeland Park Center - Lakeland, FL
Parkway Shops - Phase II - Jacksonville, FL (1)
21,909
14,193
Total
$
61,312
(1) During 2012, we continued Phase I construction on Parkway Shops, our ground up development of an 89,123 square foot
retail shopping center located in Jacksonville, Florida. The center will be anchored by a 45,000 square foot Dick’s
Sporting Goods and a 25,000 square foot Marshalls and will also include approximately 19,000 square feet of non-anchor
space. The net cost of Phase I is approximately $19.6 million. Costs shown here relate to land held for Phase II.
Accounting for the Impairment of Long-Lived Assets
We review our investment in real estate, including any related intangible assets, for impairment on a property-by-property basis
whenever events or changes in circumstances indicate that the remaining estimated useful lives of those assets may warrant
revision or that the carrying value of the property may not be recoverable. For operating properties, these changes in
circumstances include, but are not limited to, changes in occupancy, rental rates, tenant sales, net operating income, geographic
location, and real estate values. The viability of all projects under construction or development, including those owned by
unconsolidated joint ventures, are regularly evaluated under applicable accounting requirements, including requirements
relating to abandonment of assets or changes in use. To the extent a project, or individual components of the project, are no
longer considered to have value, the related capitalized costs are charged against operations.
Determining whether an investment in real estate is impaired and the amount of any such impairment requires considerable
management judgment. In the event that management changes its intended holding period for an investment in real estate,
impairment may result even without any other event or change in circumstances related to that investment. For example, a
determination to sell land held for development rather than to develop the land and hold the developed asset may result in
impairment. Similarly, a decision to sell an income producing property rather than to hold it may result in impairment. Under
F-9
certain circumstances, management may use probability-weighted scenarios related to an investment in real estate, and the use
of such analysis may also result in impairment. Impairment provisions resulting from any event or change in circumstances,
including changes in management’s intentions or management’s analysis of varying scenarios, could be material to our
consolidated financial statements.
We recognize an impairment of an investment in real estate when the estimated undiscounted cash flow is less than the net
carrying value of the property. If it is determined that an investment in real estate is impaired, then the carrying value is
reduced to the estimated fair value as determined by cash flow models and discount rates or comparable sales in accordance
with our fair value measurement policy.
In 2012, we recorded impairment provisions totaling $4.7 million and consisted of:
$1.4 million related to land held for development or sale and was primarily due to additional costs to ready parcels for
sale and changes in estimated market value of parcels in our Stafford County, Virginia project;
$2.9 million of impairment provisions related to income producing properties. Our decision to sell additional income
producing properties accounted for $0.4 million of impairment due to the estimated sales price being lower than the
net book value of one property. The balance of $2.5 million of impairment relates to a property that was previously
held in a consolidated partnership and was the result of the partnerships decision to convey its ownership interest in
the property to the lender in 2012;and
$0.4 million related to other-than-temporary decline in the fair market values of our investment in two unconsolidated
joint ventures.
Investments in Real Estate Joint Ventures
We have five equity investments in unconsolidated joint venture entities in which we own 50% or less of the total ownership
interest. Because we can influence but not control these joint ventures, these investments are accounted for under the equity
method. We provide leasing, development, asset and property management services to these joint ventures for which we are
paid fees. Refer to Note 7 of the notes to the consolidated financial statements for further information.
We review our equity investments in unconsolidated entities for impairment on a venture-by-venture basis whenever events or
changes in circumstances indicate that the carrying value of the equity investment may not be recoverable. In testing for
impairment of these equity investments, we primarily use cash flow models, discount rates, and capitalization rates to estimate
the fair value of properties held in joint ventures, and mark the debt of the joint ventures to market. Considerable judgment by
management is applied when determining whether an equity investment in an unconsolidated entity is impaired and, if so, the
amount of the impairment. Changes to assumptions regarding cash flows, discount rates, or capitalization rates could be
material to our consolidated financial statements.
As a result of our impairment testing, we recorded non-cash impairment provisions of $0.4 million and $9.6 million in 2012
and 2011, respectively. These amounts related to the other-than-temporary declines in the fair market value of various equity
investments in our unconsolidated joint ventures. Refer to Note 6 of the notes to the consolidated financial statements for more
information.
Other Assets, net
Other assets consist primarily of acquired lease intangibles, straight-line rent receivable, deferred leasing costs, deferred
financing costs, and prepaid expenses. Deferred financing and leasing costs are amortized using the straight-line method over
the terms of the respective agreements. Should a tenant terminate its lease, the unamortized portion of the leasing cost is
expensed. Unamortized financing costs are expensed when the related agreements are terminated before their scheduled
maturity dates. We review our unbilled straight-line rent receivable balance to determine the future collectability of revenue
that will not be billed to or collected from tenants due to early lease terminations, lease modifications, bankruptcies and other
factors. Our evaluation is based on our assessment of tenant credit risk changes indicating that expected future straight-line rent
may not be realized. Depending on circumstances, we may provide a reserve against the previously recognized straight-line
rent receivable asset for a portion, up to its full value, that we estimate may not be received.
Cash and Cash Equivalents
We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash
balances in individual banks may exceed the federally insured limit by the Federal Deposit Insurance Corporation (the
“FDIC”). From December 31, 2010 through December 31, 2012 the FDIC provided temporary unlimited deposit insurance
coverage. As of January 31, 2013, we had $2.8 million in excess of the FDIC insured limit.
F-10
Recognition of Share-based Compensation Expense
We grant share-based compensation awards to employees and trustees in the form of restricted common shares and stock
options. Our share-based award costs are equal to each grant date fair value and are recognized over the service periods of the
awards. See Note 16 of the notes to the consolidated financial statements for further information.
Income Tax Status
We made an election to qualify, and believe our operating activities qualify as a REIT for federal income tax purposes.
Accordingly, we generally will not be subject to federal income tax, provided that we distribute at least 90% of our taxable
income annually to our shareholders and meet other conditions. We are obligated to pay state taxes, generally consisting of
franchise or gross receipts taxes in certain states which are not material to our consolidated financial statements.
Certain of our operations, including property and asset management, as well as ownership of certain land parcels, are conducted
through taxable REIT subsidiaries, (“TRSs”) which are subject to federal and state income taxes. During the years ended
December 31, 2012, 2011, and 2010, we sold various properties and land parcels at a gain, resulting in both a federal and state
tax liability. See Note 17 of the notes to the consolidated financial statements for further information.
Variable Interest Entities
Certain entities that do not have sufficient equity at risk for the entity to finance its activities without additional subordinated
financial support from other parties or in which equity investors do not have the characteristics of a controlling financial
interest qualify as VIEs. VIEs are required to be consolidated by their primary beneficiary. Effective January 1, 2010, with the
adoption of a new accounting pronouncement, the primary beneficiary of a VIE has both (i) the power to direct the activities
that most significantly impact economic performance of the VIE, and (ii) the obligation to absorb losses or the right to receive
benefits that could potentially be significant to the VIE. Prior to January 1, 2010, the primary beneficiary of a VIE was
determined to be the party that absorbs a majority of the entity’s expected losses, receives a majority of its expected returns, or
both.
We have evaluated our investments in joint ventures and determined that the joint ventures do not meet the requirements of a
VIE and, therefore, consolidation of these ventures is not required. Accordingly, these investments are accounted for using the
equity method.
Noncontrolling Interest in Subsidiaries
We have certain noncontrolling interest in subsidiaries that are generally exchangeable for our common shares on a 1:1 basis or
cash, at our election. Noncontrolling interest is classified as a separate component of equity outside of the permanent equity
section of our consolidated balance sheets. Consolidated net income and comprehensive income includes the noncontrolling
interest’s share. The calculation of earnings per share is based on income available to common shareholders.
Segment Information
Our primary business is the ownership, management, redevelopment, development and operation of retail shopping centers.
We do not distinguish our primary business or group our operations on a geographical basis for purposes of measuring
performance. We review operating and financial data for each property on an individual basis and define an operating segment
as an individual property. The individual properties have been aggregated into one reportable segment based upon their
similarities with regard to both the nature and economics of the centers, tenants and operational processes, as well as long-term
financial performance. No one individual property constitutes more than 10% of our revenue or property operating income and
none of our shopping centers are located outside the United States. Accordingly, we have a single reportable segment for
disclosure purposes.
F-11
2. Recent Accounting Pronouncements
In May 2011, the FASB updated ASC 820 “Fair Value Measurements and Disclosures” with ASU 2011-04 “Amendments to
Achieve Common Fair Value Measurements and Disclosure Requirements in U.S. GAAP and IFRS”. The amendments change
the wording used to describe many of the requirements in U.S. GAAP for measuring fair value and for disclosing information
about fair value measurements. This standard is to be applied prospectively and is effective for fiscal years, and interim periods
within those years, beginning after December 15, 2011. We adopted this standard in the first quarter 2012 and it did not have a
material impact on our consolidated financial statements.
In June 2011, the FASB updated ASC 220 “Comprehensive Income” with ASU 2011-05 “Presentation of Comprehensive
Income,” which requires an entity to present the total of comprehensive income, the components of net income, and the
components of other comprehensive income either in a single continuous statement of comprehensive income or in two
separate but consecutive statements. This standard is to be applied retrospectively and is effective for fiscal years, and interim
periods within those years, beginning after December 15, 2011. In December 2011, the FASB deferred portions of this update
in its issuance of ASU 2011-12, “Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of
Items Out of Accumulated Other Comprehensive Income.” ASU 2011-12 supersedes certain pending paragraphs in Update
2011-05. The amendments are being made to allow the FASB time to re-deliberate whether or not to present on the face of the
financial statements the effects of reclassifications out of accumulated other comprehensive income on the components of net
income and other comprehensive income for all periods presented. The new disclosures in this standard did not have a material
impact on our results of operations or financial position, other than the presentation of comprehensive income.
In September 2011, the FASB updated ASC 350 “Intangibles – Goodwill and Other” with ASU 2011-08 “Testing Goodwill for
Impairment.” Under this update, an entity has the option to first assess qualitative factors to determine whether the existence of
events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than
its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is not more likely than not
that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is
unnecessary. This standard is effective for fiscal years beginning after December 15, 2011. We adopted this standard in the
first quarter 2012 and it did not have a material impact on our consolidated financial statements.
In December 2011, the FASB updated ASC 210 “Balance Sheet” with ASU 2011-11 “Disclosures about Offsetting Assets and
Liabilities.” Under this update companies are required to provide new disclosures about offsetting and related arrangements for
financial instruments and derivatives. The provisions of ASU 2011-11 are effective for annual reporting periods beginning on
or after January 1, 2013, and are required to be applied retrospectively. We do not expect this update to have a material impact
on our consolidated financial statements.
In December 2011, the FASB updated ASC 220 “Comprehensive Income” with ASU 2011-12 “Deferral of the Effective Date
for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU
2011-05.” This update requires that all non-owner changes in stockholders’ equity be presented in either a single continuous
statement of comprehensive income or in two separate but consecutive statements. ASU 2011-12 defers only those changes in
ASU 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income.
The provisions of ASU 2011-12 are effective for public companies in fiscal years beginning after December 15, 2011.
The disclosures in this standard did not have a material impact on our results of operations or financial position, other than the
presentation of comprehensive income.
In July 2012 the FASB updated ASC 350 “Intangibles – Goodwill and Other – Testing Indefinite-Lived Intangible Assets for
Impairment” with ASU 2012-02. This update amends the procedures for testing the impairment of indefinite-lived intangible
assets by permitting an entity to first assess qualitative factors to determine whether the existence of events and circumstances
indicates that it is more likely than not that the indefinite-lived intangible assets are impaired. An entity’s assessment of the
totality of events and circumstances and their impact on the entity’s indefinite-lived intangible assets will then be used as a
basis for determining whether it is necessary to perform the quantitative impairment test as described in ASC 350-30. ASU
2012-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012,
with early adoption permitted. We adopted this standard in the fourth quarter 2012 and it did not have a material impact on our
consolidated financial statements.
F-12
3. Real Estate
Included in our net real estate are income producing shopping center properties that are recorded at cost less accumulated
depreciation and amortization.
Land held for development or sale includes real estate projects where vertical construction has yet to commence, but which
have been identified by us and are available for future development when market conditions dictate the demand for a new
shopping center. Land held for development or sale was $81.5 million and $78.6 million at December 31, 2012 and 2011,
respectively. The increase in land held for development or sale from December 31, 2011 to December 31, 2012 was primarily
attributable to infrastructure costs related to future phases at Parkway Shops offset by impairment provisions recorded on
certain land parcels.
Construction in progress represents existing development and redevelopment projects. When projects are substantially complete
and ready for their intended use, balances are transferred to land, buildings or improvements as appropriate. Construction in
progress was $17.0 million and $8.9 million at December 31, 2012 and December 31, 2011, respectively. The increase in
construction in progress from December 31, 2011 to December 31, 2012 was due primarily to the ongoing construction of
Parkway Shops – Phase I, located in Jacksonville, Florida.
4. Property Acquisitions and Dispositions
Acquisitions
The following table provides a summary of our acquisitions during 2012, 2011 and 2010:
Property Name
Location
Spring Meadows Place II
Holland, OH
The Shoppes at Fox River - Phase II Waukesha (Milwaukee), WI
Southfield Expansion
The Shoppes of Lakeland
Central Plaza
Southfield, MI
Lakeland, FL
Ballwin (St. Louis), MO
GLA /
Acreage
Date
Acquired
49,644
47,058
19,410
183,842
166,431
12/19/12
12/13/12
09/18/12
09/06/12
06/07/12
Longmont (Boulder), CO
Longmont (Boulder), CO
Delafield (Milwaukee), WI
06/01/12
06/01/12
06/01/12
Total consolidated income producing acquisitions - 2012
159,385
176,960
113,617
Town and Country (St. Louis), MO
Creve Coeur (St. Louis), MO
11/30/11
05/19/11
Total consolidated income producing acquisitions - 2011
141,996
269,254
Harvest Junction North
Harvest Junction South
Nagawaukee Shopping Center
Town & Country Crossing
Heritage Place
The Shoppes at Fox River
Merchants' Square (2)
Liberty Square
Gross
Purchase
Price
Debt
$
2,367
$
-
(1)
(1)
10,394
868
28,000
21,600
38,181
33,550
15,000
149,960
$
$
$
37,850
39,410
77,260
-
-
-
-
-
-
-
$
-
$
-
-
$
-
Waukesha (Milwaukee), WI
135,610
12/29/10
$
23,840
$
-
Carmel (Indianapolis), IN
Wauconda (Chicago), IL
10/01/10
08/10/10
Total consolidated income producing acquisitions - 2010
278,875
107,369
16,739
15,200
55,779
$
-
-
$
-
(1) Purchase price includes vacant land adjacent to the shopping center available for future development.
(2)
In the third quarter of 2010, we acquired the $32.7 million mortgage note securing Merchants’ Square, a shopping center
entity that was part of the Ramco 450 Venture LLC joint venture, for $16.8 million. During the fourth quarter of 2010, our
joint venture partner transferred its interest in the property to us for nominal consideration. See Note 7 of the notes to the
consolidated financial statements for additional information.
F-13
The total aggregate fair value of the acquisitions was allocated and is reflected in the following table in accordance with
accounting guidance for business combinations. At the time of acquisition, these assets and liabilities were considered Level 2
fair value measurements:
2012
$
38,756
100,216
1,874
2,522
16,566
(9,974)
-
-
149,960
-
149,960
December 31,
2011
(In thousands)
22,294
$
48,971
996
7,733
2,099
(4,833)
-
-
77,260
-
77,260
$
2010
$
12,331
49,051
1,910
7,576
467
(3,392)
(492)
(1,836)
65,615
(9,836)
55,779
$
$
Land
Buildings and improvements
Above market leases
Lease origination costs
Other assets
Below market leases
Other liabilities
Deferred liability
Total fair value
Bargain purchase gain
Total purchase price allocated
Dispositions
The following table provides a summary of our disposition activity during 2012, 2011, and 2010:
Property Name
Location
Southbay SC and Pelican Plaza
Osprey and Sarasota, FL
Eastridge Commons
OfficeMax Center
Flint, MI
Toledo, OH
GLA /
Acreage
189,763
169,676
22,930
Date
Sold
Sales
Price
Gross
Debt
Repaid
(In thousands)
Gain
on Sale
05/15/12
02/27/12
03/27/12
$
5,600
$
-
$
72
1,750
1,725
-
-
137
127
Total consolidated income producing dispositions
$
9,075
$
-
$
336
Outparcel
Roswell, GA
2.26
02/14/12
$
2,030
$
-
$
69
Total consolidated land / outparcel dispositions
$
2,030
$
-
$
69
Total 2012 consolidated dispositions
$
11,105
$
-
$
405
Taylors Square
Sunshine Plaza
Lantana Shopping Center
Greenville, SC
Tamarac, FL
Lantana, FL
12/20/11
07/11/11
04/29/11
Total consolidated income producing dispositions
33,791
237,026
123,014
Southbay Shopping Center - outparcel
River City Shopping Center - outparcel
River City Shopping Center - outparcel
Osprey, FL
Jacksonville, FL
Jacksonville, FL
1.31
0.95
1.02
06/29/11
03/02/11
01/21/11
Total consolidated land / outparcel dispositions
$
$
$
$
$
$
4,300
15,000
16,942
36,242
2,625
678
663
3,966
-
$
-
-
$
-
$
-
-
-
$
-
$
$
1,020
(32)
6,209
7,197
2,240
74
127
2,441
Total 2011 consolidated dispositions
$
40,208
$
-
$
9,638
Ridgeview Crossing SC
Elkin, NC
211,524
05/12/10
$
900
$
-
$
(2,050)
Total consolidated income producing dispositions
$
900
$
-
$
(2,050)
Promenade at Pleasant Hill - outparcel
Duluth, GA
Ramco Hartland - outparcel
Ramco Jacksonville - outparcel
Hartland, MI
Jacksonville, FL
2.55
0.93
1.29
09/30/10
09/23/10
06/20/10
Total consolidated land / outparcel dispositions
$
1,900
$
-
$
1,611
435
-
25
1,069
3,404
$
-
$
-
460
2,096
$
Total 2010 consolidated dispositions
$
4,304
$
-
$
46
F-14
5. Discontinued Operations
We will classify properties as held for sale when executed purchase and sales agreement contingencies have been satisfied
thereby signifying that the sale is guaranteed and legally binding. As of December 31, 2012, we did not have any properties
held for sale.
The following table provides a summary of selected operating results for those properties sold during the years ended
December 31, 2012, 2011 and 2010:
2012
$
1,989
December 31,
2011
(In thousands)
7,429
$
2010
$
12,003
558
264
342
248
577
(247)
(2,536)
307
336
(1,563)
$
3,075
470
2,431
1,487
(34)
-
(10,883)
1,218
9,406
(293)
$
4,304
1,122
2,682
2,492
1,403
-
-
(242)
(2,050)
(889)
$
Total revenue
Expenses:
Recoverable operating expenses
Other non-recoverable property operating expenses
Depreciation and amortization
Interest expense
Operating income (loss) of properties sold
Other expense
Provision for impairment
Gain (loss) on extinguishment of debt
Gain (loss) on sale of properties
Loss from discontinued operations
6. Impairment Provisions
We established provisions for impairment during the years ended December 31 for the following consolidated assets and
unconsolidated joint venture investments:
Land held for development or sale (1)
Income producing properties available for sale (2)
Investments in unconsolidated joint ventures (3)
Total
Year Ended
December 31,
2012
2011
2010
(In thousands)
$
1,387
$
11,468
$
28,787
2,915
386
16,332
9,611
-
2,653
$
4,688
$
37,411
$
31,440
(1)
(2)
(3)
In 2012, changes to estimated sales price assumptions and additional costs to complete to ready parcels for sale triggered
an impairment provision of $1.4 million. Refer to Note 1 under Accounting for the Impairment of Long-Lived Assets for a
discussion of inputs used in determining the fair value of long-lived assets.
In 2012, our decision to sell additional wholly-owned income producing properties resulted in an impairment provision of
$0.4 million. In addition, $2.5 million of impairment relates to a property that was previously held in a consolidated
partnership and was the result of the partnerships decision to convey its ownership interest in the property to the lender in
2012. Refer to Note 1 under Accounting for the Impairment of Long-Lived Assets for a discussion of inputs used in
determining the fair value of long-lived assets.
In 2012, we determined that potentially lower market values for certain joint venture properties considered for sale or
conveyance to the lender warranted an analysis of whether the fair values of our equity investments in unconsolidated joint
ventures, analyzed on a venture-by-venture basis, were less than their carrying value and, if so, whether any such decreases
in value were other-than-temporary. As a result of our fair value assessment, we recorded a $0.4 million other-than-
temporary decline in the fair market values of our investment in two unconsolidated joint ventures. Refer to Note 7 of the
notes to the consolidated financial statements and Off Balance Sheet Arrangements in Note 1 for more information.
F-15
Our impairment provisions for our land held for sale and our income producing properties available for sale were based upon
the difference between the present value of estimated sales prices of the available-for-sale parcels or properties and our
allocated or net book basis of those parcels and properties. Future sales prices were estimated based upon comparable market
transactions for similar land parcels or properties, market rates of return, and other market data relevant to valuing each land
parcel or property. Our valuation in these investments are classified as Level 3 of the fair value hierarchy under GAAP. Refer
to Note 11 of the notes to the consolidated financial statements for a discussion of fair value measurements.
7. Equity Investments in Unconsolidated Entities
We have five joint venture agreements whereby we own between 7% and 30% of the equity in the joint venture. We and the
joint venture partners have joint approval rights for major decisions, including those regarding property operations. We cannot
make significant decisions without our partner’s approval. Accordingly, we account for our interest in the joint ventures using
the equity method of accounting.
Combined financial information of our unconsolidated entities is summarized as follows:
Balance Sheets
ASSETS
Investment in real estate, net
Other assets
Total Assets
LIABILITIES AND OWNERS' EQUITY
Mortgage notes payable
Other liabilities
Owners' equity
Total Liabilities and Owners' Equity
2012
December 31,
2011
(In thousands)
2010
$
$
796,584
56,631
853,215
$
$
866,184
61,377
927,561
$
$
923,910
40,975
964,885
$
$
$
360,302
13,866
479,047
853,215
396,792
16,547
514,222
927,561
$
$
$
436,650
16,436
511,799
964,885
RPT's equity investments in unconsolidated joint ventures
$
95,987
$
97,020
$
105,189
Statements of Operations
2012
Total Revenue
Total Expenses
Income before other income and expenses
Provision for impairment of long-lived assets
Gain on extinguishment of debt
Gain on sale of land
(Loss) gain on sale of real estate
Net Income (loss)
$
December 31,
2011
(In thousands)
86,150
94,539
(8,389)
(5,607)
-
-
2010
$
93,945
87,066
6,879
(9,102)
-
-
$
83,087
75,749
7,338
(7,622)
1,011
793
$
(61)
1,459
$
6,796
(7,200)
$
-
(2,223)
RPT's share of earnings from unconsolidated joint ventures (1)
$
3,646
$
1,669
$
(221)
(1) For the year ended December 31, 2012, our pro-rata share excludes $398,000 in costs associated with the liquidation of
two joint ventures concurrent with the extinguishment of their debt. The costs are reflected in earnings (loss) from
unconsolidated joint ventures on our statement of operations.
F-16
As of December 31, we had investments in the following unconsolidated entities:
Unconsolidated Entities
Ramco/Lion Venture LP
Ramco 450 Venture LLC
Other Joint Ventures
Ownership as
of December 31,
Total Assets as of
December 31,
Total Assets as of
December 31,
2012
30%
20%
(1)
2012
2011
(In thousands)
$
495,585
303,107
$
517,344
300,380
54,523
853,215
$
109,837
927,561
$
(1) Other JV's include joint ventures in which we own 7%-20% of the sole property in the joint venture.
Acquisitions
There were no acquisitions of shopping centers in 2012 and 2011 by any of our unconsolidated joint ventures.
Dispositions
The following table provides a summary of our unconsolidated joint venture disposition activity during 2012 and 2011:
Property Name
Location
CVS Outparcel
Wendy's Outparcel
Southfield Expansion
Shoppes of Lakeland
Autozone Outparcel
Collins Pointe Shopping Center
Cartersville, GA
Plantation, FL
Southfield, MI
Lakeland, FL
Cartersville, GA
Cartersville, GA
Shenandoah Square
Davie, FL
Debt
GLA /
Acreage
Date
Sold
Ownership
%
Sales Price
(at 100%)
Gross
Debt
Repaid
(In thousands)
Gain on Sale
(at 100%)
1.21
1.00
19,410
183,842
0.85
10/22/12
09/28/12
09/18/12
09/06/12
09/10/12
20%
$
2,616
$
-
$
77
30%
50%
7%
20%
1,063
396
28,000
939
-
-
-
-
627
(138)
166
89
20%
Total 2012 unconsolidated joint venture's dispositions
06/01/12
81,042
40%
Total 2011 unconsolidated joint venture's dispositions
08/24/11
123,612
4,650
37,664
$
-
$
-
$
(89)
732
$
$
21,950
21,950
$
$
11,519
11,519
$
$
6,796
6,796
Our unconsolidated entities had the following debt outstanding at December 31, 2012:
Entity Name
Ramco/Lion Venture LP (1)
Ramco 450 Venture LLC (2)
Ramco 191 LLC (3)
Unamortized premium
Total mortgage debt
Balance
Outstanding
(In thousands)
$
181,708
170,763
7,875
360,346
(44)
360,302
$
$
(1) Maturities range from July 2013 to June 2020 with interest rates ranging from 5.0% to 8.2%.
(2) Maturities range from February 2013 to January 2023 with interest rates ranging from 3.8% to 6.0%.
(3) Maturity of January 2014. The interest rate is variable based on LIBOR plus 3.50%.
F-17
During 2012, the following joint ventures had mortgage loan repayment activity:
Ramco/Lion Venture L.P. joint venture, in which our ownership interest is 30%:
o
o
In June repaid the West Broward Shopping Center property mortgage in the amount of $9.1 million. Our
proportionate share of the debt repayment is approximately $2.7 million;
In October completed the conveyance of its ownership interest in Gratiot Crossing to the lender in lieu of
repayment of a non-recourse mortgage loan in the amount of $13.4 million, of which our share is
approximately $4.0 million;
Ramco 450 Venture LLC. joint venture, in which our ownership interest is 20%:
o
In December refinanced the $27.6 million, 5.95% interest mortgage on The Shops on Lane Avenue property
with a mortgage in the amount of $28.7 million and a 3.8% interest rate maturing in December 2022; and
Ramco/West Acres LLC, in which our ownership interest was 40%, completed the conveyance of its ownership
interest in February of its sole shopping center to the lender in lieu of repayment of a non-recourse mortgage loan in
the amount of $8.4 million, of which our share was approximately $3.4 million. Ramco/West Acres LLC was
subsequently liquidated:
Joint Venture Management and Other Fee Income
We are engaged by certain of our joint ventures to provide asset management, property management, leasing and investing
services for such venture’s respective properties. We receive fees for our services, including property management fees
calculated as a percentage of gross revenues received and recognize these fees as the services are rendered.
The following table provides information for our fees earned which are reported in our consolidated statements of operations:
2012
December 31,
2011
(In thousands)
2010
Management fees
Leasing fees
Acquisition/disposition fees
Construction fees
Total
$
2,564
$
2,633
$
2,792
1,026
16
318
918
66
364
908
251
95
$
3,924
$
3,981
$
4,046
8. Other Assets, Net
Other assets consisted of the following:
Deferred leasing costs, net
Deferred financing costs, net
Lease intangible assets, net
Straight-line rent receivable, net
Prepaid and other deferred expenses, net
Other, net
Other assets, net
December 31,
2012
2011
(In thousands)
$
18,067
$
14,895
6,073
25,611
14,799
4,636
5,565
13,702
16,030
4,613
$
3,767
72,953
$
4,431
59,236
F-18
The remaining weighted-average amortization period as of December 31, 2012, is 3.9 years for intangible assets attributable to
lease origination costs and for above market leases. These assets are being amortized over the lives of the applicable leases to
amortization expense and as a reduction to minimum rent revenue, respectively, over the initial terms of the respective leases.
Amortization of the intangible lease asset resulted in a reduction of revenue of approximately $0.8 million, $0.6 million, and
$0.3 million for the years ended December 31, 2012, 2011, and 2010, respectively.
The following table represents estimated aggregate amortization expense related to other assets as of December 31, 2012:
Year Ending December 31,
2013
2014
2015
2016
2017
Thereafter
Total (1)
(In thousands)
12,071
$
9,733
7,507
5,634
2,779
10,874
$
48,598
(1) Excludes straight-line rent receivable, prepaid and other deferred expenses, and deferred leasing costs for assets not yet
placed into service of $14.8 million, $4.6 million, and $5.0 million, respectively.
F-19
9. Debt
The following table summarizes our mortgages and notes payable and capital lease obligation as of December 31, 2012 and
2011:
Mortgages and Notes Payable
Fixed rate mortgages
Unsecured revolving credit facility
Unsecured term loan facilities
Junior subordinated notes
Unamortized premium
December 31,
2012
2011
(In thousands)
$
293,139
$
325,840
40,000
180,000
28,125
541,264
29,500
135,000
28,125
518,465
17
$ 541,281
47
$ 518,512
Capital lease obligation (1)
$ 6,023
$ 6,341
(1) 99 year ground lease expires September 2103. However, an anchor tenant’s exercise of its option to purchase its parcel in
October 2014 would require us to purchase the real estate that is subject to the ground lease.
Mortgages and notes payable
We repaid two wholly owned property mortgages secured by our Coral Creek and The Crossroads shopping centers totaling
$19.6 million. The mortgages bore interest at a fixed rate of 6.8% and 6.5%, respectively. Our fixed rate mortgages have
interest rates ranging from 5.1% to 7.6%, and are due at various maturity dates from July 2013 through April 2020. Included in
fixed rate mortgages at December 31, 2012 and December 31, 2011 were unamortized premium balances related to the fair
market value of debt of $0.1 million. The fixed rate mortgage notes are secured by mortgages on properties that have an
approximate net book value of $298.0 million as of December 31, 2012.
In June 2012, we conveyed title to our 77.9% owned Kentwood Towne Centre located in Kentwood, Michigan to the lender in
exchange for release from an $8.5 million non-recourse mortgage obligation.
On July 19, 2012 we entered into a $360 million unsecured credit facility which amends and restates our prior $250 million
facility. The amended facility is comprised of a $240 million revolving line of credit with a four-year term and one-year
extension option and a five-year $120 million term loan. The amended facility can be upsized to $450 million through an
accordion feature. Borrowings under the amended facility are priced at LIBOR plus 165 to 225 basis points based upon a
pricing grid tied to our leverage ratio.
As of December 31, 2012 we had net borrowings of $40.0 million on our revolving credit facility and had outstanding letters of
credit issued under our revolving credit facility, not reflected in the accompanying condensed consolidated balance sheets, of
$1.2 million. These letters of credit reduce borrowing availability under the bank facility.
The revolving credit and term loan facilities contain financial covenants relating to total leverage, fixed charge coverage ratio,
tangible net worth and various other calculations. As of December 31, 2012, we were in compliance with these covenants.
Our junior subordinated notes have a fixed interest rate until January 2013 after which time the rate becomes variable at LIBOR
plus 3.30%. The maturity date is January 2038.
The mortgage loans encumbering our properties, including properties held by our unconsolidated joint ventures, are generally
nonrecourse, subject to certain exceptions for which we would be liable for any resulting losses incurred by the lender. These
exceptions vary from loan to loan but generally include fraud or a material misrepresentation, misstatement or omission by the
borrower, intentional or grossly negligent conduct by the borrower that harms the property or results in a loss to the lender,
filing of a bankruptcy petition by the borrower, either directly or indirectly and certain environmental liabilities. In addition,
upon the occurrence of certain events, such as fraud or filing of a bankruptcy petition by the borrower, we or our joint ventures
F-20
would be liable for the entire outstanding balance of the loan, all interest accrued thereon and certain other costs, including
penalties and expenses.
We have entered into mortgage loans which are secured by multiple properties and contain cross-collateralization and cross-
default provisions. Cross-collateralization provisions allow a lender to foreclose on multiple properties in the event that we
default under the loan. Cross-default provisions allow a lender to foreclose on the related property in the event a default is
declared under another loan.
The following table presents scheduled principal payments on mortgages and notes payable as of December 31, 2012:
Year Ending December 31,
2013
2014
2015
2016 (1)
2017
Thereafter
Subtotal debt
Unamortized premium
Total debt (including unamortized premium)
(In thousands)
$
17,359
33,432
76,713
41,649
231,571
140,540
541,264
17
541,281
$
(1) Scheduled maturities in 2016 include $40.0 million which represents the balance of the unsecured
revolving credit facility drawn as of December 31, 2012.
We have no mortgage maturities until the third quarter of 2013 and it is our intent to repay these mortgages using cash,
borrowings under our unsecured line of credit, or other sources of financing.
Capital lease
We have a capital ground lease at our Gaines Marketplace shopping center. Total amounts expensed as interest relating to this
lease were $0.4 million for each of the years ended December 31, 2012, 2011 and 2010.
Approximate future rental payments under our capital ground lease are as follows:
Year Ending December 31,
2013
2014
2015
2016
2017
Thereafter
Total lease payments
Less: amounts representing interest
Total
Capital
Lease(1)
$
677
5,955
-
-
-
-
6,632
(609)
6,023
$
(1) Amounts represent a ground lease at one of our shopping centers that provides the option for us to purchase the land in
October 2014 for approximately $5.0 million.
F-21
10. Other Liabilities, net
Other liabilities consist of the following:
Lease intangible liabilities, net
Cash flow hedge marked-to-market liability
Deferred liabilities
Tenant security deposits
Other, net
Other liabilities, net
December 31,
2012
2011
(In thousands)
$
$
16,297
5,574
1,970
1,948
398
26,187
7,722
2,828
2,644
1,866
468
15,528
$
$
The increase in other liabilities was primarily due to the acquisitions that were completed in June and December 2012 and the
allocation of a portion of the purchase price to lease intangible liabilities. The lease intangible liability relates to below-market
leases that are being accreted over the applicable terms of the acquired leases, which resulted in an increase of revenue of $1.0
million, $0.6 million, and $0.4 million for the years ended December 31, 2012, 2011 and 2010, respectively.
Deferred liabilities of approximately $2.0 million are primarily related to a $1.5 million tax increment financing agreement with
the City of West Allis, Wisconsin (“City”) for the redevelopment of the West Allis Towne Centre. The City reimbursed us for
certain costs incurred to improve the shopping center which will be repaid to the City over ten years in the form of increased
property tax assessments, not to exceed $0.2 million per year until 2020. The first payment of $0.1 million was made in March
2012.
11. Fair Value
We utilize fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value
disclosures. Derivative instruments (interest rate swaps) are recorded at fair value on a recurring basis. Additionally, we, from
time to time, may be required to record other assets at fair value on a nonrecurring basis. As a basis for considering market
participant assumptions in fair value measurements, GAAP establishes three fair value levels, based on the markets in which
the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. The assessed inputs used
in determining any fair value measurement could result in incorrect valuations that could be material to our consolidated
financial statements. These levels are:
Level 1
Level 2
Level 3
Valuation is based upon quoted prices for identical instruments traded in active markets.
Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar
instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions
are observable in the market.
Valuation is generated from model-based techniques that use at least one significant assumption not observable in the
market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing
the asset or liability.
The following is a description of valuation methodologies used for our assets and liabilities recorded at fair value.
Derivative Assets and Liabilities
All of our derivative instruments are interest rate swaps for which quoted market prices are not readily available. For those
derivatives, we measure fair value on a recurring basis using valuation models that use primarily market observable inputs, such
as yield curves. We classify derivative instruments as Level 2. Refer to Note 12 for additional information on our derivative
financial instruments.
F-22
The table below presents the recorded amount of liabilities measured at fair value on a recurring basis as of December 31, 2012
and 2011.
Liabilities
Fair Value
Level 1
Level 2
Level 3
(In thousands)
2012 - Derivative liabilities - interest rate swaps
$
(5,574)
$
-
$
(5,574)
$
-
Total
2011 - Derivative liabilities - interest rate swaps
$
(2,828)
$
-
$
(2,828)
$
-
The carrying values of cash and cash equivalents, restricted cash, receivables and accounts payable and accrued liabilities are
reasonable estimates of their fair values because of the short maturity of these financial instruments.
We estimated the fair value of our debt based on our incremental borrowing rates for similar types of borrowing arrangements
with the same remaining maturity and on the discounted estimated future cash payments to be made for other debt. The
discount rates used approximate current lending rates for loans or groups of loans with similar maturities and credit quality,
assumes the debt is outstanding through maturity and considers the debt’s collateral (if applicable). Since such amounts are
estimates that are based on limited available market information for similar transactions, there can be no assurance that the
disclosed value of any financial instrument could be realized by immediate settlement of the instrument. Fixed rate debt
(including variable rate debt swapped to fixed through derivatives) with carrying values of $456.3 million and $489.0 million
as of December 31, 2012 and 2011, respectively, have fair values of approximately $455.4 million and $473.7 million,
respectively. Variable rate debt’s fair value is estimated to be the carrying values of $85.0 million and $29.5 million as of
December 31, 2012 and 2011, respectively.
Net Real Estate
Our net real estate, including any identifiable intangible assets, is subject to impairment testing on a nonrecurring basis. To
estimate fair value, we use discounted cash flow models that include assumptions of the discount rates that market participants
would use in pricing the asset. To the extent impairment has occurred, we charge to expense the excess of the carrying value of
the property over its estimated fair value. We classify impaired real estate assets as nonrecurring Level 3.
Equity Investments in Unconsolidated Entities
Our equity investments in unconsolidated joint venture entities are subject to impairment testing on a nonrecurring basis if a
decline in the fair value of the investment below the carrying amount is determined to be a decline that is other-than-temporary.
To estimate the fair value of properties held by unconsolidated entities, we use cash flow models, discount rates, and
capitalization rates based upon assumptions of the rates that market participants would use in pricing the asset. To the extent
other-than-temporary impairment has occurred, we charge to expense the excess of the carrying value of the equity investment
over its estimated fair value. We classify other-than-temporarily impaired equity investments in unconsolidated entities as
nonrecurring Level 3.
The table below presents the recorded amount of assets at the time they were marked to fair value during the years ended
December 31, 2012 and 2011 on a nonrecurring basis. We did not have any material liabilities that were required to be
measured at fair value on a nonrecurring basis during the years ended December 31, 2012 and 2011.
Assets
2012
Total
Fair Value
Level 1
Level 2
(In thousands)
Level 3
Total
Losses
Income producing properties
$
16,862
$
-
$
-
$
16,862
$
(2,915)
Land available for sale
Investments in unconsolidated entities
17,745
1,164
-
-
-
-
17,745
1,164
(1,387)
(386)
Total
2011
$
35,771
$
-
$
-
$
35,771
$
(4,688)
Income producing properties
$
39,442
$
-
$
-
$
39,442
$
(16,332)
Land available for sale
Investments in unconsolidated entities
Total
28,188
81,482
149,112
$
-
-
-
-
$
-
$
-
28,188
(11,468)
81,482
149,112
$
(9,611)
(37,411)
$
F-23
12. Derivative Financial Instruments
We utilize interest rate swap agreements for risk management purposes to reduce the impact of changes in interest rates on our
variable rate debt. On the date we enter into an interest rate swap, the derivative is designated as a hedge against the variability
of cash flows that are to be paid in connection with a recognized liability. Subsequent changes in the fair value of a derivative
designated as a cash flow hedge that is determined to be highly effective are recorded in other comprehensive income (“OCI”)
until earnings are affected by the variability of cash flows of the hedged transaction. The differential between fixed and variable
rates to be paid or received is accrued, as interest rates change, and recognized currently as interest expense in our consolidated
statements of operations. We assess effectiveness of our cash flow hedges both at inception and on an ongoing basis. Our cash
flow hedges become ineffective if critical terms of the hedging instrument and the debt do not perfectly match such as notional
amounts, settlement dates, reset dates, calculation period and LIBOR rate.
At December 31, 2012, we had four interest rate swap agreements in effect for an aggregate notional amount of $135.0 million
that were designated as cash flow hedges. The agreements provide for swapping one-month LIBOR interest rates ranging from
1.2% to 2.0% on our $75.0 million and $60.0 million unsecured term loans, and have expirations ranging from April 2016 to
October 2018.
The following table summarizes the notional values and fair values of our derivative financial instruments as of December 31,
2012:
Underlying Debt
Hedge
Type
Notional
Value
(In thousands)
Fixed
Rate
Value
(In thousands)
Fair
Expiration
Unsecured term loan facility
Cash Flow
$
75,000
1.2175%
$
2,038
Unsecured term loan facility
Cash Flow
Unsecured term loan facility
Cash Flow
Unsecured term loan facility
Cash Flow
30,000
25,000
5,000
2.0480%
1.8500%
1.8400%
1,926
1,349
261
$
135,000
$
5,574
Date
04/2016
10/2018
10/2018
10/2018
The following table presents the fair values of derivative financial instruments in our consolidated balance sheets as of
December 31, 2012 and December 31, 2011, respectively:
December 31, 2012
December 31, 2011
Liability Derivatives
Derivatives designated as
hedging instruments
Balance Sheet
Location
Fair
Value
(In thousands)
Balance Sheet
Location
Fair
Value
(In thousands)
Interest rate contracts
Other liabilities
$
(5,574)
Other liabilities
$
(2,828)
Total
$
(5,574)
Total
$
(2,828)
The effect of derivative financial instruments on our consolidated statements of operations for the year ended December 31,
2012 and 2011 is summarized as follows:
Amount of Loss
Location of
Loss
Amount of Loss
Reclassified from
Recognized in OCI on Derivative
Reclassified from
Accumulated OCI into
(Effective Portion)
Accumulated OCI
Income (Effective Portion)
Derivatives in Cash Flow
Hedging Relationship
Year Ended December 31,
into Income
Year Ended December 31,
2012
2011
(Effective Portion)
2012
2011
(In thousands)
(In thousands)
Interest rate contracts
$
(2,745)
$
(2,828)
Interest Expense
$
(1,782)
$
(563)
Total
$
(2,745)
$
(2,828)
Total
$
(1,782)
$
(563)
F-24
13. Leases
Revenues
Approximate future minimum revenues from rentals under non-cancelable operating leases in effect at December 31, 2012,
assuming no new or renegotiated leases or option extensions on lease agreements were as follows:
Year Ending December 31,
2013
2014
2015
2016
2017
Thereafter
Total
Expenses
(In thousands)
$
96,642
89,253
78,034
64,781
48,163
183,799
560,672
$
We have an operating lease for our corporate headquarters in Michigan for a term expiring in 2019. We also have an operating
lease adjacent to our former Taylors Square shopping center. Approximate future rental payments under our non-cancelable
leases, assuming no option extensions are as follows:
Year Ending December 31,
2013
2014
2015
2016
2017
Thereafter
Total
(In thousands)
$
658
579
462
468
475
1,423
4,065
$
F-25
14. Earnings per Common Share
The following table sets forth the computation of basic earnings per share (“EPS”):
Year Ended December 31,
2012
2011
(In thousands, except per share data)
2010
Income (loss) from continuing operations
Net loss from continuing operations attributable to noncontrolling interest
Preferred share dividends
Allocation of continuing income to restricted share awards
Income (loss) from continuing operations attributable to RPT
$ 8,655
$ (28,207)
$ (22,835)
9
1,764
3,513
(7,250)
(5,244)
-
13
257
246
$ 1,427
$ (31,430)
$ (19,076)
Loss from discontinued operations
(1,563)
(293)
(889)
Net loss (income) from discontinued operations attributable to noncontrolling interest
103
(22)
63
Allocation of discontinued loss to restricted share awards
Loss from discontinued operations attributable to RPT
Net loss available to common shareholders
15
3
8
(1,445)
$ (18)
(312)
$ (31,742)
(818)
$ (19,894)
Weighted average shares outstanding, Basic
44,101
38,466
35,046
(Loss) earnings per common share, Basic
Continuing operations
Discontinued operations
Net loss available to common shareholders
The following table sets forth the computation of diluted EPS:
Income (loss) from continuing operations
Net loss from continuing operations attributable to noncontrolling interest
Preferred share dividends
Allocation of continuing income to restricted share awards
Allocation of over distributed continuing income to restricted share awards
Income (loss) from continuing operations attributable to RPT
$
0.03
$
(0.83)
$
(0.55)
(0.03)
$
-
$
(0.01)
(0.84)
$
(0.02)
(0.57)
Year Ended December 31,
2012
2011
(In thousands, except per share data)
2010
$ 8,655
$ (28,207)
$ (22,835)
9
1,764
3,513
(7,250)
(5,244)
-
13
257
246
(21)
(38)
(10)
$ 1,406
$ (31,468)
$ (19,086)
Loss from discontinued operations
Net loss (income) from discontinued operations attributable to noncontrolling interest
(1,563)
103
(293)
(22)
(889)
63
Allocation of discontinued income to restricted share awards
Loss from discontinued operations attributable to RPT
Net loss available to common shareholders
1
-
1
(1,459)
$ (53)
(315)
$ (31,783)
(825)
$ (19,911)
Weighted average shares outstanding, Basic
Stock options and restricted share awards using the treasury method (1)
Dilutive effect of securities (2)
Weighted average shares outstanding, Diluted
44,101
384
-
44,485
38,466
-
-
38,466
35,046
-
-
35,046
(Loss) earnings per common share, Diluted
Continuing operations
Discontinued operations
Net loss available to common shareholders
$ 0.03
$ (0.83)
$ (0.55)
(0.03)
$ -
(0.01)
$ (0.84)
(0.02)
$ (0.57)
(1) For the years ended December 31, 2011 and 2010 stock options and restricted stock awards are anti-dilutive and
accordingly, have been excluded from the weighted average common shares used to compute diluted EPS.
(2) The assumed conversion of preferred shares are anti-dilutive for all periods presented and accordingly, have been excluded
from the weighted average common shares used to compute diluted EPS.
F-26
15. Shareholders’ Equity
On May 22, 2012 we completed an underwritten public offering of 5.5 million newly issued common shares of beneficial
interest at $12.10 per share. The underwriters were granted an option to purchase an additional 0.825 million common shares
and they fully exercised that option on June 1, 2012. Our total net proceeds, after deducting expenses, were approximately
$73.2 million. In addition, we issued 3.1 million common shares through our controlled equity offerings generating $38.1
million in net proceeds, after sales commissions and fees of $0.8 million. The average share price of shares issued under the
controlled equity offering in 2012 was $12.79 per share. In the third quarter 2012 we registered a new controlled equity
offering whereby we may sell up to 6.0 million common shares of beneficial interest once the shares of the previous offering
had been issued. As of December 31, 2012 we had 5.2 million shares available for issuance.
In April 2011, we completed an $80.0 million (1,600,000 shares) offering of 7.25% Series D Cumulative Convertible Perpetual
Preferred Shares of beneficial interest (the “Series D Preferred Shares”). The annual dividend on each Series D Preferred Share
is $3.625 per share and is payable quarterly as declared by our board of trustees. Each preferred share has a liquidation
preference of $50.00 per share and is convertible, at the holder’s option at any time. The Series D Preferred Shares are not
redeemable by us for the first seven years, and then only upon the occurrence of certain events. On April 29, 2012, we closed
on an additional $20.0 million, or 400,000 preferred shares, through a re-opening of the same security. Net proceeds from the
two offerings of $96.6 million were used to repay our $30.0 million secured bridge loan and reduce borrowings on our secured
revolving credit facility. Additionally, during 2011, we issued 683,000 common shares through a controlled equity offering
generating $8.8 million in net proceeds.
We have a dividend reinvestment plan that allows for participating shareholders to have their dividend distributions
automatically invested in additional shares of beneficial interest based on the average price of the shares acquired for the
distribution.
16. Share-Based Compensation and Other Benefit Plans
Incentive and Stock Option Plans
The 2012 Omnibus Long-Term Incentive Plan was approved by shareholders at the 2012 Annual Meeting of Shareholders on
June 6, 2012 (“2012 LTIP”). Under the plan our compensation committee may grant, subject to the Company’s performance
conditions as specified by the compensation committee, restricted shares, restricted share units, options and other awards to
trustees, officers and other key employees. The 2012 LTIP allows us to issue up to 2,000,000 of our common shares, units or
stock options, all of which is available for issuance.
The following share-based compensation plans have been terminated, except with respect to awards outstanding under each
plan:
The 2009 Omnibus Long-Term Incentive Plan (“2009 LTIP”) which allowed for the grant of restricted shares,
restricted share units, options and other awards to trustees, officers and other key employees;
The 2008 Restricted Share Plan for Non-Employee Trustees (the “Trustees’ Plan”) which allowed for the grant of
restricted shares to non-employee trustees of the Company;
2003 LTIP - allowed for the grant of stock options to our executive officers and employees. As of December 31,
2012, there were 173,490 options exercisable; and
2003 and 1997 Non-Employee Trustee Stock Option Plans – these plans provided for the annual grant of options to
purchase our shares to our non-employee trustees. As of December 31, 2012, there were 29,253 options exercisable.
We recognized total share-based compensation expense of $2.6 million, $1.8 million, and $1.2 million for 2012, 2011, and
2010, respectively.
Restricted Stock Share-Based Compensation
In 2012 the compensation committee determined that the LTIP award would consist of 50% service based restricted shares and
50% performance-based cash awards that are earned subject to a future performance measurement based on a three-year
shareholder return peer comparison (the “2012 TSR Grant”). If the performance criterion is met the actual value of the grant
earned will be determined and 50% of the award will be paid in cash immediately while the balance will be paid in cash the
following year.
F-27
Pursuant to ASC 718 – Stock Compensation, we determine the grant date fair value of 2012 TSR Grants, and any subsequent
re-measurements, based upon a Monte Carlo simulation model. We will recognize the compensation expense ratably over the
requisite service period. We are required to re-value the performance cash awards at the end of each quarter using the same
methodology as was used at the initial grant date and adjust the compensation expense accordingly. If it is determined that the
performance criteria will not be met, compensation expense previously recognized would be reversed. During 2012 we
recognized compensation expense of $0.4 million related to the cash awards. No such cash awards existed in 2011 or 2010.
In 2011 and 2010, the compensation committee determined that the LTIP award for those years would consist of 50% service-
based restricted shares and 50% performance-based grants to our senior management. The service-based restricted share
awards include a five year vesting period and the compensation expense is recognized on a graded vesting basis. The
performance-based share awards are also earned subject to a future performance measurement based on our three-year total
shareholder return compared to a peer group (“TSR Grant”). Once the performance criterion is met and the actual number of
shares earned is determined, certain shares will vest immediately while others will vest over an additional service period. We
determine the grant date fair value of TSR Grants based upon a Monte Carlo Simulation model and recognize the compensation
expense ratably over the vesting periods.
We recognized $2.2 million, $1.7 million, and $1.1 million of expense related to restricted share grants during the years ended
December 31, 2012, 2011, and 2010, respectively.
A summary of the activity of service based restricted shares under the LTIP for the years ended December 31, 2012, 2011 and
2010 is presented below:
2012
2011
2010
Number
of
Shares
Weighted-
Average Grant
Date Fair
Value
Number
of
Shares
Weighted-
Average Grant
Date Fair
Value
Number
of
Shares
Weighted-
Average Grant
Date Fair
Value
Outstanding at the beginning of the year
Granted
Vested
Forfeited or expired
Outstanding at the end of the year
229,722
135,223
(68,683)
(9,956)
286,306
12.40
11.30
11.47
11.95
11.83
264,657
119,964
(109,638)
(45,261)
229,722
10.78
13.34
11.04
13.12
12.40
189,292
182,410
(88,843)
(18,202)
264,657
11.83
10.16
10.49
11.99
10.78
$
$
$
$
$
$
As of December 31, 2012 there was approximately $3.8 million of total unrecognized compensation cost related to non-vested
restricted share awards granted under our various share-based plans that we expect to recognize over a weighted average period
of 4.2 years.
F-28
Stock Option Share-Based Compensation
We recognized approximately $0.1 million of expense related to options during each of the years ended December 31, 2012,
2011 and 2010. The fair values of each option granted used in determining the share-based compensation expense is estimated
on the date of grant using the Black-Scholes option-pricing model. This model incorporates certain assumptions for inputs
including risk-free rates, expected dividend yield of the underlying common shares, expected option life and expected
volatility.
In connection with the employment of an executive officer, during 2010 we issued options to purchase 75,000 of our common
shares that vest ratably over three years. We used the following assumptions for those options:
Weighted average fair value of grants
Risk-free interest rate
Dividend yield
Expected life (in years)
Expected volatility
$
9.61
2.9%
6.8%
6.5
41.0%
No options, except those noted above, were granted under the LTIP in the years ended December 31, 2012, 2011 and 2010.
The following table reflects the stock option activity for all plans described above:
2012
2011
2010
Shares
Under
Option
Weighted-
Average
Exercise
Price
Shares
Under
Option
Weighted-
Average
Exercise
Price
Shares
Under
Option
Weighted-
Average
Exercise
Price
Outstanding at the beginning of the year
Granted
Exercised
Forfeited or expired
Outstanding at the end of the year
272,201
-
(25,000)
(19,458)
227,743
25.98
-
9.61
25.65
27.81
323,948
-
(25,000)
(26,747)
272,201
25.06
-
9.61
30.18
25.98
324,720
75,000
-
(75,772)
323,948
28.47
9.61
-
29.64
25.06
$
$
$
$
$
$
Exercisable at the end of year
202,743
$
30.05
222,201
$
29.67
248,948
$
29.72
Weighted average fair value of options
granted during the year
$
-
$
-
$
2.06
The following tables summarize information about options outstanding at December 31, 2012:
Range of Exercise Price
Outstanding
Options Outstanding
Weighted-Average
Remaining
Contractual Life
Options Exercisable
Weighted-Average
Exercise Price
Exercisable
Weighted-Average
Exercise Price
$ 9.61 - $ 9.61
$23.77 - $27.96
$28.80 - $29.06
$34.30 - $36.50
25,000
79,917
49,806
73,020
227,743
7.1
1.9
3.0
4.2
3.5
$
$
9.61
26.49
29.01
34.66
27.81
-
79,917
49,806
73,020
202,743
-
$
26.49
29.01
34.66
30.05
$
We received cash of approximately $0.2 million from options exercised during each of the years ended December 31, 2012 and
2011. The impact of the cash receipt is included in financing activities in the accompanying consolidated statements of cash
flows. No options were exercised for the year ended December 31, 2010.
F-29
17. Income Taxes
We conduct our operations with the intent of meeting the requirements applicable to a REIT under sections 856 through 860 of
the Internal Revenue Code. In order to maintain our qualification as a REIT, we are required to distribute annually at least 90%
of our REIT taxable income, excluding net capital gain, to our shareholders. As long as we qualify as a REIT, we will generally
not be liable for federal corporate income taxes.
Certain of our operations, including property management and asset management, as well as ownership of certain land, are
conducted through our TRSs which allows us to provide certain services and conduct certain activities that are not generally
considered as qualifying REIT activities.
Deferred tax assets and liabilities reflect the impact of temporary differences between the amounts of assets and liabilities for
financial reporting purposes and the bases of such assets and liabilities as measured by tax laws. Deferred tax assets are reduced
by a valuation allowance to the amount where realization is more likely than not assured after considering all available
evidence, including expected taxable earnings and potential tax planning strategies. Our temporary differences primarily relate
to deferred compensation, depreciation and net operating loss carryforwards.
In May 2011, the State of Michigan signed bills into law that replaced the Michigan Business Tax (“MBT”) with a six percent
Corporate Income Tax that became effective January 1, 2012. The repeal of the MBT resulted in the de-recognition of our
related deferred tax assets and liabilities, therefore, we recorded additional income tax expense of approximately $0.8 million in
the year ended December 31, 2011 as a result of this tax law change. These amounts are included in income tax (provision)
benefit in our consolidated statements of operations.
As of December 31, 2012, we had a federal and state deferred tax asset of $0.3 million and $0.2 million, respectively, net of
valuation allowances of $9.5 million and $8.9 million, respectively. We believe that it is more likely than not that the results of
future operations will generate sufficient taxable income to recognize the net deferred tax assets. These future operations are
primarily dependent upon the profitability of our TRSs, the timing and amounts of gains on land sales, and other factors
affecting the results of operations of the TRSs. The valuation allowances relate to net operating loss carryforwards and tax
basis differences where there is uncertainty regarding their realizability.
During the years ended December 31, 2012 and 2011, we recorded an income tax benefit (provision) of approximately $34,000
and ($0.8) million, respectively.
We had no unrecognized tax benefits as of or during the three year period ended December 31, 2012. We expect no significant
increases or decreases in unrecognized tax benefits due to changes in tax positions within one year of December 31, 2012. No
material interest or penalties relating to income taxes were recognized in the statement of operations for the years ended
December 31, 2012, 2011, and 2010 or in the consolidated balance sheets as of December 31, 2012, 2011, and 2010. It is our
accounting policy to classify interest and penalties relating to unrecognized tax benefits as tax expense. As of December 31,
2012, returns for the calendar years 2009 through 2012 remain subject to examination by the Internal Revenue Service (“IRS”)
and various state and local tax jurisdictions. As of December 31, 2012, certain returns for calendar year 2008 also remain
subject to examination by various state and local tax jurisdictions.
18. Transactions with Related Parties
During 2011 and 2010 we had agreements with various partnerships and performed management services on behalf of entities
owned in part by certain of our trustees and/or officers. The following revenue was earned during the three years ended
December 31, 2012 from these related parties:
2012
Year Ended December 31,
2011
(In thousands)
72
$
12
110
194
$
2010
$
$
102
26
7
135
Management fees
Leasing fees
Other
Total
-
$
-
-
$
-
We had no receivables from related parties at December 31, 2012 and 2011, respectively. These agreements were terminated
with the sale of the joint venture’s sole property, Shenandoah Shopping Center, in August 2011.
F-30
19. Commitments and Contingencies
Construction Costs
In connection with the development and expansion of various shopping centers as of December 31, 2012, we had entered into
agreements for construction costs of approximately $5.5 million.
Litigation
We are currently involved in certain litigation arising in the ordinary course of business.
Environmental Matters
Under various Federal, state and local laws, ordinances and regulations relating to the protection of the environment
(“Environmental Laws”), a current or previous owner or operator of real estate may be liable for the costs of removal or
remediation of certain hazardous or toxic substances disposed, stored, released, generated, manufactured or discharged from,
on, at, onto, under or in such property. Environmental Laws often impose such liability without regard to whether the owner or
operator knew of, or was responsible for, the presence or release of such hazardous or toxic substance. The presence of such
substances, or the failure to properly remediate such substances when present, released or discharged, may adversely affect the
owner’s ability to sell or rent such property or to borrow using such property as collateral. The cost of any required remediation
and the liability of the owner or operator therefore as to any property is generally not limited under such Environmental Laws
and could exceed the value of the property and/or the aggregate assets of the owner or operator. Persons who arrange for the
disposal or treatment of hazardous or toxic substances may also be liable for the cost of removal or remediation of such
substances at a disposal or treatment facility, whether or not such facility is owned or operated by such persons. In addition to
any action required by Federal, state or local authorities, the presence or release of hazardous or toxic substances on or from
any property could result in private plaintiffs bringing claims for personal injury or other causes of action.
In connection with ownership (direct or indirect), operation, management and development of real properties, we may be
potentially liable for remediation, releases or injury. In addition, Environmental Laws impose on owners or operators the
requirement of on-going compliance with rules and regulations regarding business-related activities that may affect the
environment. Such activities include, for example, the ownership or use of transformers or underground tanks, the treatment or
discharge of waste waters or other materials, the removal or abatement of asbestos-containing materials (“ACMs”) or lead-
containing paint during renovations or otherwise, or notification to various parties concerning the potential presence of
regulated matters, including ACMs. Failure to comply with such requirements could result in difficulty in the lease or sale of
any affected property and/or the imposition of monetary penalties, fines or other sanctions in addition to the costs required to
attain compliance. Several of our properties have or may contain ACMs or underground storage tanks (“USTs”); however, we
are not aware of any potential environmental liability which could reasonably be expected to have a material impact on our
financial position or results of operations. No assurance can be given that future laws, ordinances or regulations will not impose
any material environmental requirement or liability, or that a material adverse environmental condition does not otherwise
exist.
20. Subsequent Events
We have evaluated subsequent events through the date that the consolidated financial statements were issued.
Subsequent to December 31, 2012, we executed a sale agreement for our Mays Crossing property located in Stockbridge,
Georgia in the amount of $8.4 million. In addition, we executed a purchase agreement for a property in Wisconsin in the
amount of $22.7 million. The agreements are subject to contingencies for due diligence.
We also completed the sale of land at our Roseville Towne Center to Walmart, an anchor tenant, and an outlot parcel at our
Parkway Shops development for combined net proceeds of $9.6 million.
F-31
21. Quarterly Financial Data (Unaudited)
The following table sets forth the quarterly results of operations for the year ended December 31, 2012:
March 31 (1)
Quarters Ended 2012
June 30 (1)
September 30 (1)
(In thousands, except per share amounts)
December 31 (1)
Total revenue
$
30,928
$
30,972
$
32,695
$
34,143
Income before other income and expenses, tax and discontinued operations
$
8,650
$
7,771
$
8,360
$
9,240
Income (loss) from continuing operations
(Loss) income from discontinued operations
$
2,074
$
1,775
$
3,208
$
1,598
$
(2,126)
$
389
$
113
$
61
Net (loss) income
$
(52)
$
2,164
$
3,321
$
1,659
Net loss (income) attributable to noncontrolling partner interest
534
(185)
(158)
(79)
Preferred share dividends
Net (loss) income available to common shareholders
$
(1,812)
(1,330)
$
(1,813)
166
$
(1,813)
1,350
$
(1,812)
(232)
(Loss) earnings per common share, basic: (2)
Continuing operations
Discontinued operations
Net (loss) income available to common shareholders
(Loss) earnings per common share, diluted:(2)
Continuing operations
Discontinued operations
Net (loss) income available to common shareholders
$
0.02
$
-
$
0.03
$
(0.01)
$
(0.05)
(0.03)
-
$
-
$
-
0.03
$
-
(0.01)
$
0.02
$
-
$
0.03
$
(0.01)
$
(0.05)
(0.03)
-
$
-
$
-
0.03
$
-
(0.01)
(1) Amounts are reclassified to reflect the reporting of discontinued operations.
(2) EPS amounts are based on weighted average common shares outstanding during the quarter and, therefore, may not agree with the EPS calculated for the
year ended December 31, 2012.
The following table sets forth the quarterly results of operations for the years ended December 31, 2011:
March 31 (1)
June 30 (1)
September 30 (1)
December 31 (1)
Quarters Ended 2011
(In thousands, except per share amounts)
Total revenue
Income before other income and expenses, tax and discontinued operations
$
28,932
$
28,506
$
30,649
$
29,487
$
7,128
$
6,798
$
8,715
$
6,297
(Loss) income from continuing operations
Income (loss) from discontinued operations
$
(477)
$
(2,564)
$
5,853
$
(31,019)
$
224
$
8,093
$
(51)
$
(8,559)
Net (loss) income
$
(253)
$
5,529
$
5,802
$
(39,578)
Net loss (income) attributable to noncontrolling partner interest
21
(371)
(389)
2,481
Preferred share dividends
Net (loss) income available to common shareholders
$
-
(232)
$
(1,619)
3,539
$
(1,813)
3,600
(1,812)
(38,909)
$
(Loss) earnings per common share, basic: (2)
Continuing operations
Discontinued operations
Net (loss) income available to common shareholders
(Loss) earnings per common share, diluted:(2)
Continuing operations
Discontinued operations
Net (loss) income available to common shareholders
$
(0.01)
$
(0.10)
$
0.09
$
(0.79)
$
-
(0.01)
$
0.19
0.09
$
-
0.09
$
(0.21)
(1.00)
$
(0.01)
$
(0.10)
$
0.09
$
(0.79)
$
-
(0.01)
$
0.19
0.09
$
-
0.09
$
(0.21)
(1.00)
(1) Amounts are reclassified to reflect the reporting of discontinued operations.
(2) EPS amounts are based on weighted average common shares outstanding during the quarter and, therefore, may not agree with the EPS calculated for the
year ended December 31, 2011.
F-32
Location Encumbrances
6,825
$
$
Building &
Land Improvements
$
$
$
$
$
Accumulated
Date of
Date
Total Depreciation Constructed Acquired
RAMCO-GERSHENSON PROPERTIES TRUST
SCHEDULE III
SUMMARY OF REAL ESTATE AND ACCUMULATED DEPRECIATION
December 31, 2012
(in thousands of dollars)
INITIAL COST
TO COMPANY
GROSS AMOUNTS AT WHICH
Capitalized
CARRIED AT CLOSE OF PERIOD
Subsequent to
Acquisition or
MI
MI
MO
GA
MI
MI
GA
FL
OH
WI
MI
MI
MI
MI
CO
CO
MO
GA
MI
GA
MI
MI
MI
MI
IL
MI
GA
IN
WI
FL
MI
TN
MI
GA
FL
FL
FL
MI
OH
FL
MI
OH
MI
FL
WI
VA
MO
OH
FL
WI
MI
MI
Various
Various
3,134
27,537
10,246
4,628
24,153
16,684
19,242
110,000
16,516
14,245
26,512
13,417
$
293,139
15,704
1,806
10,250
1,880
1,175
1,500
729
1,565
5,800
1,768
665
3,255
363
226
8,254
6,241
13,899
658
3,308
1,133
2,249
2,806
470
2,018
2,670
1,317
725
4,997
3,654
218
817
1,854
955
3,891
19,768
728
954
1,403
796
5,503
1,121
2,646
3,819
1,850
8,534
-
8,395
930
862
1,866
-
1,391
28,266
10,931
208,583
$
-
6,093
10,909
10,801
10,499
13,498
6,562
14,085
20,709
16,216
5,981
17,620
3,263
6,782
25,232
22,856
22,506
5,953
29,778
10,200
20,237
6,270
4,234
18,114
11,862
11,786
6,532
18,346
11,670
1,964
7,354
11,566
8,591
22,520
73,859
6,459
8,587
13,195
3,087
20,236
10,777
16,758
43,181
16,650
26,227
-
26,465
8,372
7,768
16,789
6,304
12,519
14,026
27,252
779,100
$
Improvements, Net
of Impairments
(7,037)
2,106
0
(226)
230
10,328
928
678
3,021
2,264
920
4,446
1,039
9,028
0
0
218
10,041
4,346
3,179
15,908
6,271
1,263
3,437
(91)
235
2,426
105
0
5,458
6,035
(1,512)
6,028
(263)
7,989
87
1,731
6,824
2,478
348
(3)
6,193
33,315
713
366
22,472
2
(350)
3,976
13,709
12,215
6,883
33,096
(12,824)
230,029
Land
5,917
1,809
10,250
1,987
1,175
1,625
729
1,572
4,904
1,768
645
3,260
363
8,343
8,254
6,241
13,899
658
3,304
1,143
2,249
2,691
993
3,402
2,670
1,317
725
4,997
3,654
807
817
969
955
3,440
11,140
728
954
1,403
797
5,503
1,042
2,637
3,819
1,857
8,534
3,685
8,395
813
862
1,866
1,768
1,391
33,566
10,403
208,695
Building &
Improvements
2,750
8,196
10,909
10,468
10,729
23,701
7,490
14,756
24,626
18,480
6,921
22,061
4,302
7,693
25,232
22,856
22,724
15,994
34,128
13,369
36,145
12,656
4,974
20,167
11,771
12,021
8,958
18,451
11,670
6,833
13,389
10,939
14,619
22,708
90,476
6,546
10,318
20,019
5,564
20,584
10,853
22,960
76,496
17,356
26,593
18,787
26,467
8,139
11,744
30,498
16,751
19,402
41,822
14,956
1,009,017
8,667
10,005
21,159
12,455
11,904
25,326
8,219
16,328
29,530
20,248
7,566
25,321
4,665
16,036
33,486
29,097
36,623
16,652
37,432
14,512
38,394
15,347
5,967
23,569
14,441
13,338
9,683
23,448
15,324
7,640
14,206
11,908
15,574
26,148
101,616
7,274
11,272
21,422
6,361
26,087
11,895
25,597
80,315
19,213
35,127
22,472
34,862
8,952
12,606
32,364
18,519
20,793
75,388
25,359
1,217,712
1999
2000
1,888
2004
2004
1,669
2012
1970
257
2004
1997
2,235
2003
2,605
1992
1996
9,384 1977 / 1985
1998
1978
2,951
2002
1992
4,041
2001
2001
8,106
2000
1992
5,158
2,989
1996
1990
5,173 1987 / 2007 2003 / 2005
1996
1977
1,776
2004
2004
1,554
2012
2006
415
2012
2006
392
2011
1989
1,509
1996
1986
4,085
2003
1989
7,684
2002
1996
2,926
1996
1967
13,556
1996
1996
4,657
1996
1977
2,098
2003
1996
5,260
2010
1987
1,014
2003
1988
3,139
1997
1984
3,160
2010
1970
2,988
2012
1994
207
1996
1982
2,755
5,525
1996
1975
3,234 1989 / 1999 1997 / 1999
1996
1982
5,371
2004
1993
4,982
2005
2005
16,011
2003
1998
1,608
1998
1980
3,012
1996
1963
8,096
2005
2006
1,065
1996
1985
172
1996
1969
5,516
1996
1987
8,523
1996
1968
28,152
2002
1988
4,609
2010
2009
1,546
1998
2009
2,217
2011
2008
953
1996
1990
3,583
1997
1987
3,412
1996
1987
8,897
1996
1979
6,199
1996
1986
7,674
N/A
N/A
-
1,474
N/A
N/A
237,462
Property
Auburn Mile
Beacon Square
Central Plaza
Centre at Woodstock
Clinton Pointe
Clinton Valley
Conyers Crossing
Coral Creek Shops
Crossroads Centre
East Town Plaza
Edgewood Towne Center
Fairlane Meadows
Fraser Shopping Center
Gaines Marketplace
Harvest Junction North
Harvest Junction South
Heritage Place
Holcomb Center
Hoover Eleven
Horizon Village
Jackson Crossing
Jackson West
Lake Orion Plaza
Lakeshore Marketplace
Liberty Square
Livonia Plaza
Mays Crossing
Merchants' Square
Nagawaukee Shopping Center
Naples Towne Centre
New Towne Plaza
Northwest Crossing
Oak Brook Square
Promenade at Pleasant Hill
River City Marketplace
River Crossing Centre
Rivertowne Square
Roseville Towne Center
Rossford Pointe
Shoppes of Lakeland
Southfield Plaza
Spring Meadows Place (1)
Tel-Twelve
The Crossroads
The Shoppes at Fox River
The Town Center at Aquia Office Building
Town & Country Crossing
Troy Towne Center
Village Lakes Shopping Center
West Allis Towne Centre
West Oaks I
West Oaks II (2)
Land Held for Future Development (3)
Land Available for Sale (4)
TOTALS
$
$
$
$
$
$
.
(1) The property's mortgage loan is cross-collateralized with West Oaks II.
(2) The property's mortgage loan is cross-collateralized with a portion of Spring Meadows Place.
(3) Land held for future development includes three parcels of land located in Florida and Michigan.
(4) Land available for sale includes five parcels of land adjacent to certain of our existing developed properties located in Florida, Georgia, Michigan, Tennessee and Virginia.
F-33
SCHEDULE III
REAL ESTATE INVESTMENT AND ACCUMULATED DEPRECIATION
December 31, 2012
Reconciliation of total real estate carrying value:
Balance at beginning of year
Additions during period:
Improvements
Acquisition
Consolidation of variable interest entity
Deductions during period:
Cost of real estate sold/written off
Impairment
Balance at end of year
Reconciliation of accumulated depreciation:
Balance at beginning of year
Depreciation Expense
Cost of real estate sold/written off
Balance at end of year
2012
Year ended December 31,
2011
(In thousands)
2010
$
1,084,457
$
1,074,095
$
1,003,091
27,527
138,971
-
21,240
71,265
-
23,840
62,575
23,797
(28,941)
(4,302)
1,217,712
$
(54,343)
(27,800)
1,084,457
$
(10,421)
(28,787)
1,074,095
$
$
$
$
222,722
25,059
(10,319)
237,462
213,919
28,242
(19,439)
222,722
194,181
26,326
(6,588)
213,919
$
$
$
Aggregate cost for federal income tax purposes
$
1,204,529
$
1,057,194
$
1,026,629
F-34
Exhibit 10.9
SUMMARY OF COMPENSATION FOR
THE BOARD OF TRUSTEES OF
RAMCO-GERSHENSON PROPERTIES TRUST
The following table sets forth the compensation program for non-employee Trustees:
Annual cash retainer (1)
Additional cash retainer:
Annual equity retainer (value of restricted shares) (2)
Chairman
Audit Committee chair
Compensation Committee chair
Nominating and Governance Committee chair
Executive Committee chair
Executive Committee members
$
30,000
100,000
7,500
5,000
5,000
2,500
-
50,000
(1) The annual cash retainer is equal to $80,000 less the grant date fair value, which approximates $50,000, of the
restricted shares granted in the applicable year.
(2) Grants are made under the Trust's 2012 Restricted Share Plan for Non-Employee Trustees. The restricted shares vest
over three years. The grant is made on July 1st or, if not a business day, the business day prior to July 1st. During
2012, 3,962 shares were granted per Trustee.
The Trust also reimburses all Trustees for all expenses incurred in connection with attending any meetings or performing
their duties as Trustees.
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Share Dividends
2012
Exhibit 12.1
2008
2011
Year Ended December 31,
2010
(In thousands, except ratio computation)
2009
Pretaxincome from continuing operations before adjustment for noncontrolling interest
$
8,621
$
(27,412)
$
(23,505)
$
9,679
$
27,746
Add back:
Fixed charges
Distributed income of equity investees
Deduct:
Equity in earnings of equity investees
Capitalized interest
Earnings as Defined
Fixed Charges
28,618
3,793
30,124
4,413
34,348
2,904
30,906
3,836
35,733
6,389
(3,248)
(1,669)
221
(1,328)
(2,506)
(996)
36,788
$
(325)
5,131
$
(1,158)
12,810
$
(2,116)
40,977
$
(1,577)
65,785
$
Interest expense including amortization of deferred financing fees
$
27,344
$
29,497
$
32,870
$
28,469
$
33,837
Capitalized interest
Interest portion of rent expense
Fixed Charges
Preferred share dividends
Combined Fixed Charges and Preferred Dividends
996
278
325
302
1,158
320
2,116
321
1,577
319
$
28,618
$
30,124
$
34,348
$
30,906
$
35,733
7,250
35,868
$
5,244
35,368
$
-
34,348
$
-
30,906
$
-
35,733
$
Ratio of Earnings to Combined Fixed Charges and Preferred Dividends
1.03
(a)
(b)
1.33
1.84
(a)
(b)
Due to the pretax loss from continuing operations for year ended December 31, 2011, the ratio coverage were less than 1:1. We would have needed to generate additional earnings of $30.2
million to achieve a coverage of 1:1 for 2011.
Due to the pretax loss from continuing operations for year ended December 31, 2010, the ratio coverage were less than 1:1. We would have needed to generate additional earnings of $21.5
million to achieve a coverage of 1:1 for 2010.
Exhibit 21.1
Subsidiaries
Name
Ramco-Gershenson, Inc.
Ramco-Gershenson, Properties, L.P.
Ramco Lion LLC
Ramco/Lion Venture LP
Ramco Properties GP, L.L.C.
Jurisdiction
Michigan
Delaware
Delaware
Delaware
Michigan
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We have issued our reports dated February 28, 2013, with respect to the consolidated financial statements, schedule, and
internal control over financial reporting included in the Annual Report of Ramco-Gershenson Properties Trust and subsidiaries
on Form 10-K for the year ended December 31, 2012. We hereby consent to the incorporation by reference of said reports in
the Registration Statements of Ramco-Gershenson Properties Trust and subsidiaries on Forms S-3 (File No. 333-174805,
effective June 9, 2011) and on Forms S-8 (File No. 333-66409, effective October 30, 1998, File No. 333-121008, effective
December 6, 2004, File No. 333-160168, effective July 14, 2009, and File No. 333-182514, effective July 9, 2012).
Exhibit 23.1
/s/ GRANT THORNTON LLP
Southfield, Michigan
February 26, 2013
I, Dennis E. Gershenson, certify that:
CERTIFICATIONS
Exhibit 31.1
1.
I have reviewed this annual report on Form 10-K of Ramco-Gershenson Properties Trust;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of,
and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial
reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period
in which this report is being prepared;
b) designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report
our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period
covered by this report based upon such evaluation; and
d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred
during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control
over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of
directors (or persons performing the equivalent functions):
a) all significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
b) any fraud, whether or not material, that involves management or other employees who have a significant role
in the registrant’s internal control over financial reporting.
Date: February 26, 2013
/s/ Dennis E. Gershenson
Dennis E. Gershenson
President and Chief Executive Officer
I, Gregory R. Andrews, certify that:
CERTIFICATIONS
Exhibit 31.2
1.
I have reviewed this annual report on Form 10-K of Ramco-Gershenson Properties Trust;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of,
and for, the periods presented in this report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based upon such evaluation; and
d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred
during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected , or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of
directors (or persons performing the equivalent functions):
a) all significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
b) any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 26, 2013
/s/ Gregory R. Andrews
Gregory R. Andrews
Chief Financial Officer and Secretary
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Ramco-Gershenson Properties Trust (the “Company”) on Form 10-K for the period
ended December 31, 2012, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Dennis
E. Gershenson, President and Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act, that:
1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of
operations of the Company.
/s/ Dennis E. Gershenson
Dennis E. Gershenson
President and Chief Executive Officer
February 26, 2013
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.2
In connection with the Annual Report of Ramco-Gershenson Properties Trust (the “Company”) on Form 10-K for the period
ended December 31, 2012, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gregory
R. Andrews, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act, that:
1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of
operations of the Company.
/s/ Gregory R. Andrews
Gregory R. Andrews
Chief Financial Officer and Secretary
February 26, 2013
This page intentionally left blank..
property Summary
PrOPerTy
nAme
COLOrAdO
LOCATiOn
OwnershiP
%
TOTAL
Owned
GLA
Harvest Junction North
Harvest Junction South
Longmont
Longmont
100%
100%
159,385
176,960
FLOridA
Cocoa Commons
Coral Creek Shops
Cypress Point
Kissimmee West
Marketplace of Delray
Martin Square
Mission Bay Plaza
Naples Towne Centre
River City Marketplace
River Crossing Centre
Rivertowne Square
Shoppes of Lakeland
The Crossroads
The Plaza at Delray
Treasure Coast Commons
Village Lakes
Shopping Center
Village of Oriole Plaza
Village Plaza
Vista Plaza
West Broward
Shopping Center
GeOrGiA
Centre at Woodstock
Conyers Crossing
Holcomb Center
Horizon Village
Mays Crossing
Paulding Pavilion
Peachtree Hill
Promenade at Pleasant Hill
iLLinOis
Liberty Square
Market Plaza
Rolling Meadows
Shopping Center
indiAnA
Merchants’ Square
Nora Plaza
mAryLAnd
Cocoa
Coconut Creek
Clearwater
Kissimmee
Delray Beach
Stuart
Boca Raton
Naples
Jacksonville
New Port Richey
Deerfield Beach
Lakeland
Royal Palm Beach
Delray Beach
Jensen Beach
Land O’ Lakes
Delray Beach
Lakeland
Jensen Beach
30%
100%
30%
7%
30%
30%
30%
100%
100%
100%
100%
100%
100%
20%
30%
100%
30%
30%
30%
90,116
109,312
167,280
115,586
238,901
331,105
263,721
134,707
551,428
62,038
146,843
183,842
120,092
326,824
92,979
186,313
155,770
146,755
109,761
Plantation
30%
152,973
Woodstock
Conyers
Roswell
Suwanee
Stockbridge
Hiram
Duluth
Duluth
100%
100%
100%
100%
100%
20%
20%
100%
86,748
170,475
106,003
97,001
137,284
84,846
154,718
280,225
Wauconda
Glen Ellyn
100%
20%
107,369
163,054
Rolling Meadows
20%
134,088
Carmel
Indianapolis
100%
7%
279,161
139,905
Crofton Centre
Crofton
20%
252,230
PrOPerTy
nAme
miChiGAn
Beacon Square
Clinton Pointe
Clinton Valley
Edgewood Towne Center
Fairlane Meadows
Fraser Shopping Center
Gaines Marketplace
Hoover Eleven
Hunter’s Square
Jackson Crossing
Jackson West
Lake Orion Plaza
Lakeshore Marketplace
Livonia Plaza
Millennium Park
New Towne Plaza
Oak Brook Square
Roseville Towne Center
Southfield Plaza
Tel-Twelve
The Auburn Mile
The Shops at Old Orchard
Troy Marketplace
West Oaks I
West Oaks II
Winchester Center
missOUri
LOCATiOn
OwnershiP
%
Grand Haven
Clinton Township
Sterling Heights
Lansing
Dearborn
Fraser
Gaines Township
Warren
Farmington Hills
Jackson
Jackson
Lake Orion
Norton Shores
Livonia
Livonia
Canton Township
Flint
Roseville
Southfield
Southfield
Auburn Hills
West Bloomfield
Troy
Novi
Novi
Rochester Hills
100%
100%
100%
100%
100%
100%
100%
100%
30%
100%
100%
100%
100%
100%
30%
100%
100%
100%
100%
100%
100%
30%
30%
100%
100%
30%
TOTAL
Owned
GLA
51,387
135,330
201,115
85,757
157,246
68,326
392,169
280,788
354,323
398,526
210,374
141,073
342,854
136,616
272,568
192,587
152,073
246,968
185,409
523,411
90,553
96,994
217,754
243,987
167,954
314,575
Central Plaza
Heritage Place
Town & Country Crossing
Ballwin
Creve Coeur (St. Louis)
Town & Country
100%
100%
100%
166,431
269,185
141,996
new Jersey
Chester Springs
Shopping Center
OhiO
Crossroads Centre
Olentangy Plaza
Rossford Pointe
Spring Meadows Place
The Shops on Lane Avenue
Troy Towne Center
Tennessee
Chester
20%
223,201
Rossford
Columbus
Rossford
Holland
Upper Arlington
Troy
100%
20%
100%
100%
20%
100%
344,045
253,474
47,477
261,452
170,398
144,485
Northwest Crossing
Knoxville
100%
124,453
VirGiniA
The Town Center at Aquia
The Town Center at Aquia
Stafford
100%
40,518
(Office Building)
Stafford
100%
98,147
wisCOnsin
East Town Plaza
Nagawaukee Center
The Shoppes at Fox River
West Allis Towne Centre
Madison
Delafield
Waukesha
West Allis
100%
100%
100%
100%
208,472
113,617
182,392
326,271
Corporate Office
31500 Northwestern Highway
Suite 300
Farmington Hills, MI 48334
Tel: (248) 350-9900
Fax: (248) 350-9925
www.rgpt.com
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