Trinity Place (US:TPHS)2020-08-10 20:45Financial Performance - Net income attributable to common stockholders increased by approximately $22.9 million to $20.5 million for the three months ended June 30, 2020, from a loss of $2.4 million for the same period in 2019 [159]. - Net income attributable to common stockholders increased by approximately $21.9 million to $17.3 million for the six months ended June 30, 2020, from a loss of $4.6 million for the same period in 2019 [174]. - Total rental revenues decreased by approximately $1.0 million to $274,000 for the three months ended June 30, 2020, from $1.3 million for the same period in 2019 [146]. - Total rental revenues decreased by approximately $2.0 million to $578,000 for the six months ended June 30, 2020, from $2.6 million for the same period in 2019 [160]. - Property operating expenses increased by approximately $346,000 to $1.2 million for the three months ended June 30, 2020, primarily due to $917,000 in costs incurred to repair construction-related defects [148]. - Property operating expenses increased by approximately $1.3 million to $2.8 million for the six months ended June 30, 2020, primarily due to $2.2 million in costs incurred to repair construction-related defects [162]. - General and administrative expenses increased by approximately $79,000 to $2.8 million for the six months ended June 30, 2020, compared to $2.7 million for the same period in 2019 [163]. - Depreciation and amortization expense decreased by approximately $391,000 to $1.4 million for the six months ended June 30, 2020, from approximately $1.8 million for the same period in 2019 [167]. - Interest expense, net increased by $272,000 to $254,000 for the three months ended June 30, 2020, from approximately $18,000 in interest income for the same period in 2019 [157]. - Interest expense, net increased by $289,000 to $250,000 for the six months ended June 30, 2020, from approximately $39,000 of interest income, net for the same period in 2019 [171]. Property and Development - The 77 Greenwich project is a mixed-use development with 90 luxury residential condominium units, 7,500 square feet of retail space, and a 476-seat elementary school, with construction temporarily suspended due to COVID-19 but expected to be completed within budget [129]. - As of June 30, 2020, the Paramus property is fully leased at 100%, while the 237 11th Street property has a leasing rate of 25.7% [129]. - The Berkley property, a joint venture, is fully leased at 100% and collected approximately 90.3% of rent due during the second quarter ended June 30, 2020 [140]. - The 250 North 10th Street property, also a joint venture, is currently 94.9% leased and collected approximately 92.0% of rent due during the second quarter ended June 30, 2020 [141]. - The company is exploring options for the Paramus property, including potential development or sale [135]. - The 237 11th Street property is undergoing remediation due to construction defects, with occupancy currently at 25.7% [138]. - The company recognized a gain of approximately $20.0 million from the sale of a condominium unit to the New York City School Construction Authority (SCA) as part of the 77 Greenwich project [132]. - The construction of the 77 Greenwich project was impacted by COVID-19, causing delays in the timeline for completion and sales of residential units [133]. Cash and Debt Management - As of June 30, 2020, total cash and restricted cash amounted to $22.2 million, an increase from $18.7 million as of December 31, 2019 [176]. - The Corporate Credit Facility had an outstanding balance of $34.0 million as of June 30, 2020, with an effective interest rate of 9.375% [180]. - The 77 Greenwich Construction Facility had a balance of $126.9 million at June 30, 2020, with an effective interest rate of 9.25% [184]. - The Corporate Credit Facility has a principal amount of $70.0 million, with an interest rate of 5.25% plus a scheduled interest of 4.0% [208]. - The 250 North 10th Loan bears interest at 3.39% for its duration, while the Berkley Loan was replaced with a new 7-year loan at a fixed rate of 2.717% [187][186]. - The company had a variable-rate secured line of credit with a balance of $7.25 million as of June 30, 2020 [209]. - A hypothetical increase of 100 basis points in interest rates would result in a change in interest expense ranging from approximately $1.9 million lower to $0.6 million higher [211]. - The fair value of the company's variable-rate debt is sensitive to changes in market interest rates, similar to how bond prices decline as interest rates rise [209]. - The information presented only reflects exposures as of June 30, 2020, and does not account for any changes or exposures arising after that date [211]. - Future realized gains or losses related to interest rate fluctuations will depend on cumulative exposures and hedging strategies employed [212]. Tax and Losses - The company has approximately $224.2 million in federal net operating loss carryforwards (NOLs) as of June 30, 2020, which can be utilized to reduce future taxable income and capital gains [126]. - U.S. Federal net operating losses (NOLs) were approximately $224.2 million as of June 30, 2020, up from $162.8 million at the emergence date of the Syms bankruptcy [194]. - A valuation allowance of $58.3 million was recorded as of June 30, 2020, indicating that it is more likely than not that the entire deferred tax assets will not be realized [196]. - The company recorded $167,000 in tax expense for the six months ended June 30, 2020, compared to $191,000 for the same period in 2019 [173]. Cash Flow Activities - Net cash used in operating activities increased by approximately $5.4 million to $6.1 million for the six months ended June 30, 2020, compared to $706,000 for the same period in 2019 [191]. - Net cash used in investing activities increased by approximately $12.3 million to $37.2 million for the six months ended June 30, 2020, primarily due to investments in joint ventures [192]. - Net cash provided by financing activities increased by approximately $14.7 million to $46.8 million for the six months ended June 30, 2020, compared to $32.1 million for the same period in 2019 [193]. Joint Ventures - The joint venture acquired The Berkley for a purchase price of $68.885 million, financed with a $42.5 million loan and cash [186]. - The 250 North 10th JV acquired a 234-unit apartment building for $137.75 million, with $82.75 million financed through a 15-year mortgage loan [187]. - Equity in net loss from unconsolidated joint ventures increased by approximately $719,000 to $1.1 million for the six months ended June 30, 2020, from approximately $407,000 for the same period in 2019 [169].