UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 10, 2017
Piedmont Office Realty Trust, Inc.
(Exact name of registrant as specified in its charter)
Commission File Number: 001-34626
Maryland | 58-2328421 | |
(State or other jurisdiction of | (IRS Employer | |
incorporation) | Identification No.) | |
11695 Johns Creek Parkway
Suite 350
Johns Creek, GA 30097-1523
(Address of principal executive offices, including zip code)
770-418-8800
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.o
Item 7.01 Regulation FD Disclosure
On November 14, 2017, Piedmont Office Realty Trust, Inc. (the “Registrant”) will present the information attached as Exhibit 99.1 to this current report on Form 8-K to various parties in conjunction with the National Association of Real Estate Investment Trust (NAREIT)’s REITworld Conference occurring November 14 - 16, 2017 in Dallas, Texas. The presentation will include updates on certain leasing and transactional activity of the Registrant’s as follows:
▪ | As further described in the press release attached hereto as Exhibit 99.2, the Registrant has completed a new, full building (approximately 152,000 square foot) lease at 6011 Connection Drive in Irving, Texas with Gartner, Inc., the world's leading research and advisory company. The 15+ year lease will commence in the fall of 2018; and, |
• | On November 10, 2017, the Registrant entered into two binding contracts with two different buyers to sell 14 assets for a total minimum gross sales price of approximately $425.9 million. An additional $5 million to $10 million of gross sales price is contingent upon certain leasing activity occurring within six months after the closing date of the transactions which is currently anticipated to be in January of 2018. The Registrant anticipates recording a gain on sale of approximately $40 million in conjunction with the closing of one of the transactions and a non-cash impairment loss of approximately $48 million (prior to consideration of any contingent sales proceeds earned on future uncertain leasing activity mentioned above) during the fourth quarter of 2017 for the other transaction. Both contracts are subject to customary closing conditions. The buyers’ contractual due diligence periods have ended and both buyers have posted earnest money deposits that are nonrefundable except in limited circumstances. The 14 assets include: |
◦ | 300 Desert Canyon, Phoenix, Arizona |
◦ | Windy Point I and II, Schaumburg, Illinois |
◦ | 2300 Cabot Drive, Lisle, Illinois |
◦ | 1075 West Entrance Drive, Auburn Hills, Michigan |
◦ | Auburn Hills Corporate Center, Auburn Hills, Michigan |
◦ | 5301 Maryland Way, Brentwood, Tennessee |
◦ | Suwanee Gateway One, Suwanee, Georgia |
◦ | 5601 Hiatus Road, Tamarac, Florida |
◦ | 2001 NW 64th Street, Fort Lauderdale, Florida |
◦ | Piedmont Pointe I & II, Bethesda, Maryland |
◦ | 1200 Crown Colony Drive, Quincy, Massachusetts |
◦ | 2120 West End Avenue, Nashville, Tennessee |
For further details, please refer to page 14 of the attached Exhibit 99.1.
Pursuant to the rules and regulations of the Securities and Exchange Commission, such exhibit and the information set forth therein are deemed to have been furnished and shall not be deemed to be “filed” under the Securities Exchange Act of 1934.
Additionally, the exhibit to this Form 8-K may contain certain statements which constitute 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. Such information is subject to certain risks and uncertainties, as well as known and unknown risks, which could cause actual results to differ materially from those projected or anticipated. Therefore, such statements are not intended to be a guarantee of our performance in future periods. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “believe,” “continue” or similar words or phrases that are predictions of future events or trends and which do not relate solely to historical matters. Examples of such statements in this release include whether either of the two sale transactions described above will close in January of 2018 and the amount of gain on sale and impairment loss that will be recorded in conjunction with each transaction. A number of important factors could cause actual results or outcomes to differ materially from those contemplated by the forward-looking statements, including events that could give rise to a termination of the binding contracts for the two sale transactions described above and the other risks and uncertainties discussed under Item 1A of Piedmont's Amended Annual Report on Form 10-K/A for the year ended December 31, 2016. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Current Report on Form 8-K. The Company cannot guarantee the accuracy of any such forward-looking statements contained in this press release, and the Company does not intend to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits:
Exhibit No. | Description | |
99.1 | ||
99.2 | ||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Piedmont Office Realty Trust, Inc. | ||||
Date: November 13, 2017 | By: | /s/ Laura P. Moon | ||
Laura P. Moon | ||||
Chief Accounting Officer and Senior Vice President | ||||
Investor Presentation
November 2017
Piedmont Office Realty Trust, Inc. (also referred to herein as “Piedmont” or the “Company”) (NYSE: PDM) is an owner, manager, developer and operator of high-quality,
Class A office properties in select sub-markets located primarily within eight major eastern U.S. office markets. The Company’s geographically-diversified portfolio is
comprised of over $5.0 billion in gross assets and approximately 19 million square feet. The Company is a fully-integrated, self-managed real estate investment trust (REIT)
with local management offices in each of its major markets and is investment-grade rated by Standard & Poor’s (BBB) and Moody’s (Baa2).
We use market data and industry forecasts and projections throughout this presentation which have been obtained from publicly available industry publications. These
sources are believed to be reliable, but the accuracy and completeness of the information are not guaranteed. Certain statements contained in this presentation constitute
forward-looking statements which we intend to be covered by the safe-harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934, as applicable. Such information is subject to certain risks and uncertainties, as well as known and unknown
risks, which could cause actual results to differ materially from those projected or anticipated. Therefore, such statements are not intended to be a guarantee of our
performance in future periods. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as “may,” “will,” “expect,” “intend,”
“anticipate,” “believe,” “continue” or similar words or phrases that are predictions of future events or trends and which do not relate solely to historical matters. Some
examples of risk factors that could cause our actual results and expectations to differ materially from those described in our forward-looking statements are detailed in our
most recent Annual Report on Form 10-K and other documents we file with the Securities and Exchange Commission (“SEC”). Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date of this presentation.
Unless the context indicates otherwise, the term “properties” as used in this document and the statistical information presented in this document regarding our properties
includes our wholly-owned office properties and our office properties owned through consolidated joint ventures.
The information and non-GAAP financial terms contained in this presentation do not contain all of the information and definitions that may be important to you and should be
read in conjunction with our Amended Annual Report on Form 10-K for the year ended December 31, 2016, including our quarterly results for the periods ended March 31,
2016, June 30, 2016, September 30, 2016, and our quarterly reports on Form 10-Q for the periods ended March 31, 2017, June 30, 2017 and September 30, 2017 and our
other filings with the SEC. Other information important to you may also be found in documents that we furnish to the SEC, such as our Quarterly Supplemental Information
dated as of September 30, 2017. Such documents are available at www.sec.gov and under the heading Investor Relations on our website at www.piedmontreit.com.
Unless otherwise noted, all financial and statistical information contained in this presentation is as of September 30, 2017.
Introduction
1
9% 9%
10% 10%
11%
12%
13%
14%
ORLANDO MINNEAPOLIS BOSTON DALLAS ATLANTA CHICAGO NY METRO WASHINGTON DC
Piedmont Overview
Square Feet (millions) 18.8
Number of Properties 66
Weighted Average Lease Term 6.5 years
% Leased 89.2%
Median Building Age 18 years
Annualized Lease Revenue (millions) $548.2
% of ALR Energy-Star Rated 83%
% of ALR from Credit Tenants 1 63%
Asset Quality (Green Street Office Sector Update, 8/23/2017) A-
Ticker (NYSE) PDM
Market Cap as of 11/9/2017 (billions) $2.9
Gross Assets (billions) $5.1
Ratings (Moody’s/S&P) Baa2/BBB
Debt (billions) $1.7
Net Debt to Gross Assets 33%
Net Debt to Core EBITDA 5.6x
Dividend/Yield $0.84/4.4%
Three-Year Total Return (11/7/14-11/9/17) 17.2%
Portfolio Location
(as % of ALR as of 9/30/2017)
Core Markets
(as % of ALR as of 9/30/2017)
CORPORATE OVERVIEW PORTFOLIO OVERVIEW
URBAN INFILL
26%
CBD
40%
SUBURBAN
34%
2
AS OF 9/30/2017
UNLESS OTHERWISE NOTED AS OF 9/30/2017
3
Who is Piedmont?
DIFFERENTIATED PORTFOLIO
DISCIPLINED CAPITAL ALLOCATOR
FINANCIAL STRENGTH AND FLEXIBILITY
PROACTIVE OPERATIONAL MANAGEMENT
PATHS TO GROWTH
SUPERIOR VALUE PROPOSITION
ARLINGTON GATEWAY
Arlington, VA
ONE BRATTLE SQUARE
Cambridge, MA
Why These Markets:
• Historical and projected rental rate growth
• Barriers to entry
• Heavy amenity base
• Proximity to transportation hubs
• Ideal for large, corporate users
• Ample size and scale for liquidity
• Fragmented/limited REIT ownership
• Favorable business environment /
supportive local government
4
Differentiated Portfolio
Atlanta
Northwest, Central Perimeter
Boston
Cambridge, Burlington, Route 128
Washington, DC
District, R-B Corridor
Chicago
CBD
Minneapolis
CBD, West/SW
New York
Financial District
Dallas
Las Colinas, Uptown, Preston Center
Orlando
CBD, Lake Mary
14%
13%
10%
11%
9%
10%
9%
12%
ALR by Target Market
~90% of ALR in top 8 Markets
PORTFOLIO CONCENTRATED WITHIN EIGHT OF THE NATION’S LARGEST EASTERN MARKETS
As of 9/30/2017
5
LTM Employment Growth
JLL Office Outlook US, Q3 2017
Year-Over-Year Employment Growth
Baird Equity Research, September 2017
Construction as a % of Total Inventory
CoStar Office Statistics, Q3 2017
Number of Fortune 1000 Headquarters per 1 million of Population
Geolounge 2016 Fortune 1000 Information, US Census Bureau 2016 Population Estimates
Differentiated Portfolio
PIEDMONT’S MARKETS OFFER ATTRACTIVE FUNDAMENTALS AND FAVORABLE OUTLOOK
0.5%
1.2%
1.7%
2.1%
2.3%
2.3%
2.8%
3.2%
3.3%
Chicago
National Avg
New York
Washington DC
Boston
Minneapolis
Dallas
Atlanta
Orlando
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
Minneapolis Chicago Boston Orlando Atlanta Washington
DC
Dallas New York
10 Year Historical Average
91% 62% 51% 77% 64% 57% 59% 77%% Preleased
• PDM Markets - Weighted Growth: 2.1%
• Top Quartile for Market Employment Growth
in Office REIT Universe
Atlanta
4.5
Boston
6.0
Chicago
6.5
Dallas
5.3
Minneapolis
6.5
New York
6.4
Orlando
0.8
Washington
4.9
6
A
tlanta
-
N
o
rthwes
t
O
rlando
-
C
B
D
B
osto
n
-
128
N
o
rt
h
D
allas
-
Las
C
olina
s
Invested (# buildings, $MM) 2 4 bldgs, $192 million
Discount to Replacement Cost 3 43%
’17 Submarket Vacancy 4 15.1%
’18-’19 Submarket Cl A Rent Growth 5 6.2%
Invested (# buildings, $MM) 2 3 bldgs, $338 million
Discount to Replacement Cost 3 28%
’17 Submarket Vacancy 4 9.4%
’18-’19 Submarket Cl A Rent Growth 5 4.8%
Invested (# buildings, $MM) 2 6 bldgs, $280 million
Discount to Replacement Cost 3 25%
’17 Submarket Vacancy 4 10.4%
’18-’19 Submarket Cl A Rent Growth 5 5.6%
Invested (# buildings, $MM) 2 3 bldgs, $114 million
Discount to Replacement Cost 3 37%
’17 Submarket Vacancy 4 14.3%
’18-’19 Submarket Cl A Rent Growth 5 3.3%
Disciplined Capital Allocator
ACQUISITION ACTIVITY SINCE IPO - DOMINANT POSITIONS WITHIN TARGET SUBMARKETS
5 WALL STREET, BURLINGTON, MA
750 WEST JOHN CARPENTER, IRVING, TX
GALLERIA 200, ATLANTA, GA
CNL CENTER I & II, ORLANDO, FL
$14.50
$15.50
$16.50
$17.50
$18.50
$19.50
$20.50
$21.50
$22.50
$23.50
Nov-09 Nov-10 Nov-11 Nov-12 Nov-13 Nov-14 Nov-15 Nov-16 Nov-17
7
$679
$917 $889
$(1,064)
$(748)
$(1,754)
Acquisitions Dispositions
Disciplined Capital Allocator
Non-Core
Dispositions
Strategic
Acquisitions
Net Seller
$385M
Net Seller
$865M
2004-2007 2008-2013 2014-2017
Net Buyer
$169M
SINCE 2014, PIEDMONT HAS SOLD $1.8 BILLION OF
NON-CORE HOLDINGS, EXITING MULTIPLE MARKETS
Piedmont Stock Price Since IPO
Average Stock Buyback Price of $17.18 per Share
~29M Total Shares Repurchased
As of 9/30/2017
PIEDMONT HAS CREATED VALUE THROUGH THE
OPPORTUNISTIC ACQUISITION OF ~$500M OF ITS STOCK
Feb-10
“Management has smartly bought back stock (with sales proceeds) multiple
times this cycle…”
GreenStreet Advisors, PDM Company Snapshot August 23, 2017
Capital Recycling Since 2014
Average
GAAP Yield
5.9%
Average
Leased %
85%
Average
GAAP Yield
7.4%
Average
Leased %
81%
Period of predominant activity
8
500 WEST MONROE
Chicago, IL
Financial Strength and Flexibility
Debt Composition
As of 9/30/2017
Debt Maturity Schedule - Using Sale Proceeds to Reduce Debt
Moody’s
Baa2
S&P
BBB
WELL-LADDERED MATURITY SCHEDULE WITH ACCESS TO DEBT AND EQUITY MARKETS
$0
$200
$400
$600
2017 2018 2019 2020 2021 2022 2023 2024
Bonds LOC Term loan Secured
$0
$200
$400
$600
2017 2018 2019 2020 2021 2022 2023 2024
Bonds LOC Term loan Secured
End of 2Q 2017 End of 3Q 2017
Unsecured
$1,520
Secured
$191
Net Debt /
Gross Assets
33%
Net Debt /
Core EBITDA
5.6x
Fixed Charge
Coverage Ratio
4.7x
Weighted Avg
Interest Rate
3.47%
Ratings
As of 9/30/2017
Metrics
As of 9/30/2017
9
Proactive Operational Management
PIEDMONT MAINTAINS FIVE REGIONAL OFFICE LOCATIONS TO OPTIMIZE EFFICIENCY AND TENANT-CENTRIC FOCUS
• EVP Oversight Brent Smith
• Markets Boston
New York
• Region SF 3.6M
• Leased % 98%
(at 9/30/17)
NORTHEAST REGION
• EVP Oversight Bob Wiberg
• Markets Washington
• Region SF 3.2M
• Leased % 76%
(at 9/30/17)
MID-ATLANTIC REGION
• EVP Oversight Joe Pangburn
• Markets Dallas
• Region SF 3.4M
• Leased % 85%
(at 9/30/17)
SOUTHWEST REGION
• EVP Oversight Tom Prescott
• Markets Chicago
Minneapolis
• Region SF 4.0M
• Leased % 92%
(at 9/30/17)
MIDWEST REGION
• EVP Oversight George Wells
• Markets Atlanta
Orlando
• Region SF 4.6M
• Leased % 92%
(at 9/30/17)
SOUTHEAST REGION
Piedmont values operational
excellence and is committed to
continual improvement in
resource efficiency and
sustainability.
Throughout 2017, Piedmont’s
energy-saving initiatives are
expected to result in savings of
over 5.2 million kWh.
Piedmont leverages industry
partnerships including BOMA,
ENERGY STAR, and U.S. Green
Building Council, to advance the
energy and sustainability
performance of its assets.
83%
82%
39%
As of 9/30/2017
ORGANIC NOI GROWTH POTENTIAL
83.4%
3.6%
2.2%
80.0%
82.0%
84.0%
86.0%
88.0%
90.0%
10
Realizing Contractual Cash Flow
As of 9/30/2017
Economic
Leased
+/- $20 to 25 million of Cash NOI
Leased but Not
Yet Commenced
Under
Abatement
Paths to Growth
Capitalizing on Future Expirations (% of ALR 6)
As of 9/30/2017
Estimated 10% cash rollup on large leases3100 CLARENDON BOULEVARD
Arlington, VA
0.6%
7.9%
4.8%
6.5%
3.3%
NY State,
4.7%
Raytheon, 1.1%
Wendy's/Arbys, 1.0%
SunTrust, 0.9%
NY City, 2.0%
Nestle,
2.1%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
2017 2018 2019 2020 2021
5 & 15 WAYSIDE
Burlington, MA
7
Land Basis: $1.9M
Submarket Class A Direct Vacancy: 13.4% (Central Perimeter)
11
Paths to Growth
Strategically-Located Land Holdings for Future Development (minimum 70% pre-lease); All Land Holdings are Adjacent to Existing Core Locations
1,000,000 SF
Lake Mary, FL
Adjacent to 400 & 500 TownPark
SELECTIVE DEVELOPMENT TO EXPAND POSITIONS
AS OF 9/30/2017
Land Basis: $6.1M
Submarket Class A Direct Vacancy: 8.3% (Lake Mary)
250,000 SF
Atlanta, GA
Adjacent to Glenridge Highlands One & Two
250,000 SF
Atlanta, GA
Adjacent to The Medici
Land Basis: $2.7M
Submarket Class A Direct Vacancy: 15.9% (West Buckhead)
500,000 SF
Irving, TX
Adjacent to 6011, 6021 & 6031 Connection Drive
Land Basis: $2.8M
Submarket Class A Direct Vacancy: 14.6%
(Las Colinas)
400,000 SF
Irving, TX
Adjacent to 750 West John Carpenter Freeway
Land Basis: $1.0M
Submarket Class A Direct Vacancy: 14.6%
(Las Colinas)
Submarket vacancy data sourced from JLL Office Statistics, Q3 2017.
12
Paths to Growth
STRONG BALANCE SHEET WITH CAPACITY FOR EXPANSION
Data as of 9/30/2017
5.6x
Debt/EBITDA
33.0%
Net Debt/Gross Assets
• No complicated joint ventures
• Approximately 93% of portfolio NOI is unencumbered
• 90% fixed rate debt
• Predominately public and bank debt
LOW LEVERAGE SIMPLE CAPITAL STRUCTURE
DEBT MATURITY SCHEDULE
($M)
Over $500 MM
Liquidity
6.4x
Debt/EBITDA
36.4%
Net Debt/Gross Assets
PDM Office Average
ABILITY TO GROW FOR COMPELLING OPPORTUNITIES
$0
$100
$200
$300
$400
$500
2017 2018 2019 2020 2021 2022 2023 2024
Bonds LOC Term loan Secured
13
Superior Value Proposition
Sharpe Ratio 8 Annualized Total ReturnAnnual Standard Deviation
ATTRACTIVE RISK-ADJUSTED RETURNS
PIEDMONT INCEPTION THROUGH OCTOBER 31, 2017
UNDERVALUED WITHIN THE OFFICE REIT SECTOR
Price / NAV 9 Price / 2018 Consensus FFO 10
BXP
CXP
PGRE
BXP
PGRE
CXP
BDN
CLI
CUZ
EQC
FSP
HIW
TIER
BDN
CLI
CUZ
EQC
FSP
HIW
TIER
BDN
CLI
CUZ
HIW
OFC
17.5 x
15.2 x
11.9 x
DIVERSIFIED GATEWAY
MARKETS
SUN BELT & NON-
GATEWAY
PIEDMONT
0.60
0.50
0.39
BLOOMBERG
OFFICE REIT INDEX
PIEDMONT COMPETITIVE SET
16.8%
17.9%
21.2%
BLOOMBERG
OFFICE REIT INDEX
PIEDMONT COMPETITIVE SET
10.2%
9.0%
8.2%
BLOOMBERG
OFFICE REIT INDEX
PIEDMONT COMPETITIVE SET
BDN
CLI
CUZ
HIW
OFC
BDN
CLI
CUZ
HIW
OFC
-18.6%
-9.5%
-16.9%
DIVERSIFIED GATEWAY
MARKETS
SUN BELT & NON-
GATEWAY
PIEDMONT
Portfolio Sale Update
1
2
2
2
2
3
1
1
#
#
Market exited; number of properties sold
Market exposure reduced; submarket exited; number of properties sold
Chicago suburbs
Phoenix
Atlanta suburbs
South Florida
Boston suburbs
Maryland suburbs
Detroit
Nashville
SUMMARY OF TRANSACTIONS
# Market exposure reduced; number of properties sold
Notes: (1) The minimum gross purchase price of the contemplated transactions is $426 million. The Company has the opportunity to receive $435 million in total gross proceeds from the
contemplated transactions if certain leasing contracts are completed within six months of closing.
$426 MM to $435 MM ($165 to $168 per SF)
of Gross Sale Proceeds at approx. book value (1)
~ 6.1% to 6.2% in-place GAAP NOI cap rate (1)
2.6 MM Square Feet / 14 Assets / 76% Leased
Exit four markets and three submarkets
Anticipated closing in January 2018
~ $420 million to $430 million in net proceeds
anticipated to be used to reduce debt
14
Strategic
Operating
Markets,
47
Other, 10
Strategic
Operating
Markets,
40
Other, 3
Portfolio Sale Update
ENHANCED FOCUS
CURRENT
UPON
CLOSING
57 Projects 43 Projects (1)
DEBT METRICS (2)
5.6x to 4.7x
Debt/EBITDA
33% to 27%
Net Debt/Gross Assets
89% to 91%
Leased
18.8 to 16.3
Million Square Feet
REMAINING AMMUNITION
$650 MM
Room to peer avg.
Debt/GAV
WHAT’S IN SCOPE
Strategic Acquisitions
Selective Development
PDM Stock
OPERATIONAL METRICS (2)
PROPERTIES UNDER CONTRACT (3)
Suburban,
11
Urban
Infill, 3
Notes: (1) Represents the projected composition of the Company’s portfolio after the completion of the contemplated transactions.
(2) The first figure presented in each box is the relevant metric for the Company as of 9/30/17. The second figure presented in each box represents the metric as of 9/30/17 along with
pro forma adjustments for the contemplated transactions.
(3) Information presented is for the assets expected to be sold in the contemplated transactions.
$0
$100
$200
$300
$400
$500
2017 2018 2019 2020 2021 2022 2023 2024
Bonds LOC Term loan Secured
PRO FORMA DEBT MATURITY SCHEDULE
($M)
5 Years Weighted Average Maturity
15
16
Appendix - Footnotes
1 Includes Annualized Lease Revenue attributable to tenants with an investment grade credit rating and tenants that do not have a credit rating but have well-
established businesses, such as Independence Blue Cross, Towers Watson, Brother International, and RaceTrac Petroleum.
2 Represents the number of buildings acquired in the submarket since IPO.
3 Aggregated basis for acquired buildings since IPO as compared to the Company’s estimate of aggregated replacement cost.
4 Submarket vacancy rate for 2017 per CoStar Submarket Analysis, 11/8/2017.
5 Cumulative submarket Class A rent growth for 2018 and 2019 per CoStar Submarket Analysis, 11/8/2017.
6 Annualized rental income associated with newly executed leases for currently unoccupied space is incorporated herein only at the expiration date for the current
lease. Annualized rental income associated with such new leases is removed from the expiry year of the current lease and added to the expiry year of the new
lease.
7 Includes leases with an expiration date of September 30, 2017, comprised of 6,000 square feet and Annualized Lease Revenue of $0.1 million.
8 Sharpe Ratio is the average return earned in excess of the risk-free rate per unit of volatility. The relevant performance period is from February 10, 2010
(Piedmont’s IPO) through October 31, 2017.
9 Based on closing stock prices as of November 8, 2017. NAV per Green Street Advisors Weekly REIT Pricing Review, November 3, 2017. For companies not
covered by Green Street Advisors (CXP, FSP & TIER), consensus NAV was sourced from FactSet on November 8, 2017.
10 Based on closing stock prices as of November 8, 2017. Consensus 2018 FFO sourced from FactSet on November 8, 2017.
Exhibit 99.2
News Release
Piedmont Office Realty Trust Signs Long-Term Full Building Lease
with Gartner, Inc. in Dallas Market
ATLANTA and DALLAS - November 13, 2017 - Piedmont Office Realty Trust, Inc. (NYSE:PDM) announced today that the world’s leading research and advisory company, Gartner, Inc., has completed a 152,086 square foot, 15+ year full building new lease through 2034 at 6011 Connection Drive in Irving, TX - located within the desirable submarket of Las Colinas. The property is one of ten total properties representing approximately 2.1 million square feet of Class-A office space owned by Piedmont in the greater Dallas market.
The Cushman & Wakefield team of Andy May, Randy Cooper, Matt Heidelbaugh, and Amber Roberts represented the tenant in the transaction. Joel Pustmueller and Sarah Hinkley of Peloton Commercial Real Estate, along with Joe Pangburn and Damian Miller of Piedmont, facilitated negotiations on behalf of the owner.
“We are extremely pleased to welcome an industry-leading company such as Gartner to our portfolio of tenants,” said Joe Pangburn, Executive Vice President for Piedmont. “Completing a new lease of this size speaks to the quality and attributes of our property, as well as the demand for the amenity-rich Las Colinas submarket,” added Pangburn.
About Piedmont Office Realty Trust:
Piedmont Office Realty Trust, Inc. (NYSE: PDM) is an owner, manager, developer, and operator of high-quality, Class A office properties in select submarkets located primarily within eight major Eastern U.S. office markets. Its geographically-diversified, over $5 billion portfolio is comprised of approximately 19 million square feet. The Company is a fully-integrated, self-managed real estate investment trust (REIT) with local management offices in each of its major markets and is investment-grade rated by Standard & Poor’s (BBB) and Moody’s (Baa2). For more information, see www.piedmontreit.com.
Contact: Kerry Hughes
Company: Piedmont Office Realty Trust
Phone: 1 770 418 8800
Email: investor.relations@Piedmontreit.com