Washington Real Estate Investment (WRE) Q3 2021 Earnings Conference Call October 29, 2021 11:00 AM ET Company Participants Amy Hopkins - Vice President of Investor Relations Paul McDermott - President & Chief Executive Officer Steve Riffee - Executive Vice President & Chief Financial Officer Grant Montgomery - Vice President & Head of Research Conference Call Participants Jim Sullivan - BTIG John Pawlowski - Green Street Anthony Paolone - JPMorgan Blaine Heck - Wells Fargo Michael Lewis - Trust Securities B ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________ FORM 10-Q ___________________________________________________ Large Accelerated Filer ☒ Accelerated Filer ☐ Non-accelerated Filer ☐ Smaller Reporting Company ☐ Emerging Growth Company ☐ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarterly period ended September 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECU ...

Part I: Financial Information [Consolidated Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20%28Unaudited%29) Unaudited Q2 2021 statements reflect total assets of **$2.37 billion**, a **$7.0 million** net loss, and reclassification of divested portfolios [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to **$2.37 billion** as of June 30, 2021, with **$779.1 million** in real estate held for sale, and liabilities stable at **$1.09 billion** Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Total Assets** | **$2,368,405** | **$2,409,818** | | Investment in real estate held for sale, net | $779,121 | $795,687 | | Total real estate held for investment, net | $1,455,230 | $1,476,532 | | **Total Liabilities** | **$1,091,970** | **$1,088,709** | | Notes payable, net | $945,905 | $945,370 | | **Total Equity** | **$1,276,435** | **$1,321,109** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2021 net loss increased to **$7.0 million** from **$5.4 million** in Q2 2020, driven by transformation costs and derivative losses Statement of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | | :--- | :--- | :--- | | Real estate rental revenue | $41,297 | $43,757 | | Loss from continuing operations | $(16,737) | $(11,995) | | Income from discontinued operations | $9,745 | $6,589 | | **Net loss** | **$(6,992)** | **$(5,406)** | | **Diluted net loss per common share** | **$(0.08)** | **$(0.07)** | - The company incurred **$3.78 million** in transformation costs during the second quarter of 2021, which were not present in the prior year's quarter, and a loss of **$5.76 million** on interest rate derivatives also contributed to the net loss[14](index=14&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Q2 2021 comprehensive income was **$0.3 million**, a turnaround from a **$7.2 million** loss in Q2 2020, due to reclassification and unrealized derivative gains Comprehensive Income (Loss) (in thousands) | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | | :--- | :--- | :--- | | Net loss | $(6,992) | $(5,406) | | Other comprehensive income (loss) | $7,273 | $(1,789) | | **Comprehensive income (loss)** | **$281** | **$(7,195)** | [Consolidated Statements of Equity](index=8&type=section&id=Consolidated%20Statements%20of%20Equity) Total equity decreased to **$1.276 billion** as of June 30, 2021, primarily due to an **$8.1 million** net loss and **$50.9 million** in dividends paid - For the six months ended June 30, 2021, total equity decreased by approximately **$45 million**, driven by a net loss of **$8.1 million** and dividends of **$50.9 million** (**$0.60** per common share)[19](index=19&type=chunk) [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow increased to **$64.6 million** for the six months ended June 30, 2021, with investing activities shifting to a net use of **$18.2 million** Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :--- | :--- | :--- | | Net cash provided by operating activities | $64,622 | $51,182 | | Net cash (used in) provided by investing activities | $(18,195) | $12,131 | | Net cash used in financing activities | $(48,687) | $(69,463) | | **Net decrease in cash** | **$(2,260)** | **$(6,150)** | [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail the strategic transformation to a multifamily-focused portfolio through office and retail property sales, reclassified as discontinued operations - The company is undergoing a strategic transformation to simplify its portfolio to one reportable segment (multifamily) by divesting its office and retail properties[31](index=31&type=chunk) - In June 2021, the company entered an agreement to sell a portfolio of twelve office properties for **$766.0 million**, and subsequently agreed to sell its remaining eight retail properties for **$168.3 million**, with both portfolios classified as held for sale[48](index=48&type=chunk)[49](index=49&type=chunk) - Due to the planned prepayment of a **$150.0 million** portion of the 2018 Term Loan, related interest rate swaps were deemed no longer effective, resulting in a recognized loss of **$5.8 million** in the quarter[66](index=66&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the strategic shift to multifamily, an increased Q2 2021 net loss of **$7.0 million**, and plans to use liquidity for acquisitions and debt repayment [Overview](index=25&type=section&id=Overview) The company is divesting commercial assets for **$766.0 million** (office) and **$168.3 million** (retail) to focus on multifamily - The company is undergoing a strategic transformation to focus on the multifamily sector by selling its office and retail properties[106](index=106&type=chunk) - Net proceeds from asset sales will be used to fund multifamily acquisitions in Southeastern markets and to repay outstanding debt[107](index=107&type=chunk) Key Operating Results (Q2 2021 vs Q2 2020, in thousands) | Metric | 2021 | 2020 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Net loss | $(6,992) | $(5,406) | $(1,586) | 29.3% | | NOI | $25,067 | $27,169 | $(2,102) | (7.7)% | | NAREIT FFO | $20,559 | $31,732 | $(11,173) | (35.2)% | [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Consolidated NOI for Q2 2021 decreased 7.7% to **$25.1 million**, with net loss increasing due to transformation costs and derivative losses Consolidated NOI Comparison (Q2 2021 vs Q2 2020, in thousands) | Category | 2021 | 2020 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Same-Store NOI | $24,644 | $25,230 | $(586) | (2.3)% | | **Consolidated NOI** | **$25,067** | **$27,169** | **$(2,102)** | **(7.7)%** | - Same-store multifamily average occupancy increased to **95.1%** in Q2 2021 from **94.5%** in Q2 2020[134](index=134&type=chunk) - Key drivers of the increased net loss in Q2 2021 were **$3.8 million** in transformation costs and a **$5.8 million** loss on interest rate derivatives, which were not present in Q2 2020[137](index=137&type=chunk)[141](index=141&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is approximately **$1.4 billion** as of July 26, 2021, with plans to redeem **$300 million** Senior Notes and repay **$150 million** of its Term Loan - As of July 26, 2021, total liquidity was approximately **$1.4 billion**, consisting of approximately **$665 million** in cash and **$700 million** in credit facility availability[167](index=167&type=chunk) - The company plans to redeem all **$300.0 million** of its Senior Notes due in 2022 and repay **$150.0 million** of its 2018 Term Loan in Q3 2021[168](index=168&type=chunk)[175](index=175&type=chunk) - After planned debt repayments, the company will have no debt maturities until 2023, with the weighted average maturity of its debt being **4.7 years**[168](index=168&type=chunk)[176](index=176&type=chunk) [Funds From Operations](index=39&type=section&id=Funds%20From%20Operations) NAREIT FFO for Q2 2021 decreased to **$20.6 million** from **$31.7 million** in Q2 2020, reflecting lower operating performance and derivative losses NAREIT FFO Reconciliation (in thousands) | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | | :--- | :--- | :--- | | Net loss | $(6,992) | $(5,406) | | Depreciation and amortization | $27,551 | $29,599 | | Loss on sale of depreciable real estate | $0 | $7,539 | | **NAREIT FFO** | **$20,559** | **$31,732** | [Quantitative and Qualitative Disclosures about Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Primary market risk is interest rate risk, managed with swaps, but a **$5.8 million** loss was recognized due to ineffective hedges from a planned **$150 million** term loan prepayment - The principal market risk is interest rate risk, and the company uses interest rate swaps to manage exposure on its variable-rate debt[195](index=195&type=chunk)[196](index=196&type=chunk) - The company plans to prepay a **$150.0 million** portion of the 2018 Term Loan, consequently, the related interest rate swap hedges were determined to be no longer effective, leading to a recognized loss of **$5.8 million**[198](index=198&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective at a reasonable assurance level, with no material changes to internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective at the reasonable assurance level as of the end of the quarter[203](index=203&type=chunk) - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal controls[204](index=204&type=chunk) Part II: Other Information [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material legal proceedings - None[207](index=207&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) A new risk factor highlights challenges in expanding the multifamily platform into new Southeastern markets due to unfamiliarity with local dynamics - A new risk factor highlights the challenges of expanding into new markets, stating the company may be unable to successfully expand its multifamily operations into the Southeastern U.S[209](index=209&type=chunk) - Risks include a lack of familiarity with the dynamics and market conditions of new markets, which could adversely affect the ability to build market share or achieve desired returns[210](index=210&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no unregistered sales of equity securities - None[211](index=211&type=chunk) [Exhibits](index=44&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including the office portfolio Purchase and Sale Agreement and CEO/CFO certifications - Key exhibits filed include the Purchase and Sale Agreement with BPG Acquisitions, LLC, dated June 14, 2021, and certifications by the CEO, CFO, and Chief Accounting Officer[216](index=216&type=chunk)

Washington Real Estate Investment (WRE) Q2 2021 Earnings Conference Call July 30, 2021 11:00 AM ET Company Participants Amy Hopkins - VP, IR Paul McDermott - Chairman, President & CEO Stephen Riffee - EVP & CFO Conference Call Participants Anthony Paolone - JPMorgan Operator Operator Welcome to the Washington Real Estate Investment Trust Second Quarter Earnings Conference Call. [Operator Instructions] Before turning over the call to the Company's President and Chief Executive Officer, Paul McDermott, Amy Ho ...

Washington Real Estate Investment Trust (WRE) Q1 2021 Results Conference Call April 29, 2021 11:00 AM ET Company Participants Paul McDermott - President & Chief Executive Officer Drew Hammond - Vice President, Chief Accounting Officer and Treasurer Steve Riffee - Executive Vice President and Chief Financial Officer Grant Montgomery - Vice President and Head of Research Conference Call Participants Blaine Heck - Wells Fargo Chris Lucas - Capital One Securities Anthony Paolone - JPMorgan Daniel Ismail - Green ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________ ___________________________________________________ Large Accelerated Filer ☒ Accelerated Filer ☐ Non-accelerated Filer ☐ Smaller Reporting Company ☐ Emerging Growth Company ☐ FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarterly period ended March 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITI ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________ ___________________________________________________ FORM 10-K ___________________________________________________ ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For fiscal year ended December 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NO. 001-06622 | --- | --- | --- | |-- ...

Washington Real Estate Investment Trust (WRE) Q4 2020 Earnings Conference Call February 12, 2021 11:00 AM ET Company Participants Amy Hopkins - VP, IR Paul McDermott - Chairman, President & CEO Stephen Riffee - EVP & CFO Conference Call Participants Anthony Paolone - JP Morgan Blaine Heck - Wells Fargo Dave Rodgers - Robert W. Baird Chris Lucas - Capital One Securities Welcome to the Washington Real Estate Investment Trust fourth quarter earnings conference call. As a reminder, today's call is being recorde ...

Financial Data and Key Metrics Changes - The company reported core FFO of $0.36 per diluted share for the third quarter of 2020, with same-store NOI declining 4.9% on a GAAP basis and 3.6% year-to-date [43][44] - Overall multifamily same-store NOI decreased by 3.8% year-over-year on both GAAP and cash basis [44] - The company maintained a strong liquidity position with approximately $520 million available, following the execution of a $350 million green bond [42] Business Line Data and Key Metrics Changes - Multifamily collections were strong, with 99% of cash in contractual rents collected during the third quarter, outperforming national averages [33][34] - Office collections improved to 97% of cash rents collected during the third quarter, with 88% for retail tenants [36][38] - The suburban multifamily portfolio continued to outperform, with gross lease rates increasing by 1.1% during the third quarter [45] Market Data and Key Metrics Changes - The Washington Metro region showed resilience, with no office-using sector losing more than 4% of the total workforce year-over-year [11] - The tech sector leasing activity in Northern Virginia is expected to increase, with over 1.5 million square feet of active requirements in the pipeline [19] - The company’s multifamily units are primarily affordable, with over 75% of units affordable to renters earning $75,000 or less [15][16] Company Strategy and Development Direction - The company is focused on long-term strategic growth plans and has reshaped its portfolio ahead of the downturn [7][19] - The suburban expansion through the Assembly portfolio acquisition is performing well, capitalizing on the demand for spacious living [20] - The company aims to achieve BREEAM certification for the Assembly portfolio and LEED Silver certification for Trove, emphasizing sustainability [40][41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the portfolio and the ability to absorb near-term impacts while preserving long-term growth opportunities [9][27] - The company withdrew its previously issued 2020 outlook due to the volatile macro environment but reinstated guidance with core FFO per share expected to range from $1.44 to $1.46 [55][58] - Management noted that the duration and extent of economic disruption in 2021 remains uncertain, but they expect growth to resume sequentially in 2021 [57][58] Other Important Information - The company has implemented enhanced cleaning protocols and safety measures in its commercial properties to prepare for reentry [8] - The company was recognized for its robust ESG program, receiving an award for the Best Corporate Responsibility Program in DC and Maryland [29][30] Q&A Session Summary Question: Is there an increase in transactional volume in the investment sales market? - Management noted that suburban multifamily markets are seeing increased activity, while downtown D.C. is hindered by TOPA regulations [76][77] Question: Are there more core deals or value-add deals on the market? - Management indicated that Northern Virginia is seeing more value-add deals due to the resiliency of the job market, while D.C. is less active [84][85] Question: What is the outlook for smaller tenants in terms of space utilization? - Smaller tenants are returning to the office, while larger tenants are more cautious and considering longer-term deals [93][94] Question: What is the company's stance on potential asset dispositions? - Management remains open to monetizing assets if compelling offers arise, but is currently focused on maintaining cash flow [102][103]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________ ___________________________________________________ Large Accelerated Filer ☒ Accelerated Filer ☐ Non-accelerated Filer ☐ Smaller Reporting Company ☐ Emerging Growth Company ☐ FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarterly period ended September 30, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECU ...