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Franklin Street Properties Corp. Financial Results Supplementary Schedule B Condensed Consolidated Balance Sheets (Unaudited)(in thousands, except share and par value September 30, December 31, amounts) 2012 2011 ------------- -------------Assets:Real estate assets, net $ 1,015,984 $ 991,225Acquired real estate leases, less accumulated amortization of $35,282 and $31,189, respectively 92,717 91,613Investment in non-consolidated REITs 85,927 87,598Assets held for sale 685 15,355Cash and cash equivalents 23,962 23,813Restricted cash 546 493Tenant rent receivables, less allowance for doubtful accounts of $1,340 and $1,235, respectively 1,182 1,460Straight-line rent receivable, less allowance for doubtful accounts of $135 and $135, respectively 34,190 28,502Prepaid expenses 2,336 1,223Related party mortgage loan receivables 108,236 140,516Other assets 7,939 4,070Office computers and furniture, net of accumulated depreciation of $547 and $428, respectively 528 468Deferred leasing commissions, net of accumulated amortization of $11,489 and $9,139, respectively 21,702 22,325 ------------- ------------- Total assets $ 1,395,934 $ 1,408,661 ============= =============Liabilities and Stockholders' Equity:Liabilities: Bank note payable $ 82,000 $ 449,000 Term loan payable 400,000 - Accounts payable and accrued expenses 26,462 26,446 Accrued compensation 2,194 2,222 Tenant security deposits 2,281 2,008 Other liabilities: derivative liability 1,671 - Acquired unfavorable real estate leases, less accumulated amortization of $4,568 and $3,759, respectively 6,730 7,618 ------------- ------------- Total liabilities 521,338 487,294 ------------- -------------Commitments and contingenciesStockholders' Equity: Preferred stock, $.0001 par value, 20,000,000 shares authorized, none issued or outstanding - - Common stock, $.0001 par value, 180,000,000 shares authorized, 82,937,405 and 82,937,405 shares issued and outstanding, respectively 8 8 Additional paid-in capital 1,042,876 1,042,876 Accumulated other comprehensive loss (1,671) - Accumulated distributions in excess of accumulated earnings (166,617) (121,517) ------------- ------------- Total stockholders' equity 874,596 921,367 ------------- ------------- Total liabilities and stockholders' equity $ 1,395,934 $ 1,408,661 ============= ============= Franklin Street Properties Corp. Financial Results Supplementary Schedule C Condensed Consolidated Statements of Cash Flows (Unaudited) For the Nine Months Ended September 30, --------------------------(in thousands) 2012 2011 ------------ ------------Cash flows from operating activities: Net income $ 2,174 $ 38,462 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization expense 41,846 36,563 Amortization of above market lease 56 (119) (Gain) on sale of properties and provision for loss on property held for sale of $14,300 less applicable income tax 14,300 (21,939) Equity in earnings of non-consolidated REITs (1,061) (2,805) Distributions from non-consolidated REITs 1,246 3,034 Increase (decrease) in bad debt reserve 105 (365) Changes in operating assets and liabilities: Restricted cash (53) (57) Tenant rent receivables, net 173 869 Straight-line rents, net (3,498) (7,404) Lease acquisition costs (2,235) (55) Prepaid expenses and other assets, net (1,278) 171 Accounts payable and accrued expenses (25) 4,131 Accrued compensation (28) (420) Tenant security deposits 273 523 Payment of deferred leasing commissions (2,425) (6,710) ------------ ------------ Net cash provided by operating activities 49,570 43,879 ------------ ------------Cash flows from investing activities: Purchase of real estate assets, office computers and furniture (49,209) (155,320) Acquired real estate leases (14,376) (58,955) Investments in non-consolidated REITs (1) (10) Distributions in excess of earnings from non- consolidated REITs 1,487 1,052 Investment in related party mortgage loan receivable (73,920) (4,232) Repayment of related party mortgage loan receivable 106,200 - Changes in deposits on real estate assets - 200 Investment in assets held for syndication, net - (2,427) Proceeds received on sales of real estate assets - 96,790 ------------ ------------ Net cash used in investing activities (29,819) (122,902) ------------ ------------Cash flows from financing activities: Distributions to stockholders (47,274) (46,419) Proceeds from equity offering, net - 18,001 Proceeds from offering - (536) Borrowings under bank note payable 160,000 375,000 Repayment of bank note payable (527,000) (209,968) Borrowing of term loan payable 400,000 (74,850) Deferred financing costs (5,328) (5,389) Swap termination payment - (982) ------------ ------------ Net cash used in financing activities (19,602) 54,857 ------------ ------------Net increase (decrease) in cash and cash equivalents 149 (24,166)Cash and cash equivalents, beginning of period 23,813 68,213 ------------ ------------Cash and cash equivalents, end of period $ 23,962 $ 44,047 ============ ============ Franklin Street Properties Corp. Earnings Release Supplementary Schedule D Real Estate Portfolio Summary Information (Unaudited & Approximated) Commercial portfolio lease expirations (1) Total % of Year Square Feet Portfolio ------------------------ ------------ ------------ 2012 88,523 1.2% 2013 423,414 5.9% 2014 411,131 5.7% 2015 835,285 11.6% 2016 925,979 12.8% Thereafter (2) 4,540,166 62.8% ------------ ------------ 7,224,498 100.0% ============ ============(1) Percentages are determined based upon square footage of expiring commercial leases and excludes the asset held for sale.(2) Includes 623,131 square feet of current vacancies.(dollars & square feet in thousands) As of September 30, 2012 (a) -------------------------------------------------- # of % of Square % ofState Properties Investment Portfolio Feet Portfolio------------------------ ---------- ----------- --------- ------ ---------Texas 10 $ 291,470 28.7% 2,028 28.1%Colorado 4 123,182 12.1% 790 10.9%Georgia 2 108,321 10.7% 774 10.7%Virginia 4 100,190 9.9% 684 9.5%Minnesota 2 39,417 3.9% 626 8.7%Missouri 3 66,437 6.5% 477 6.6%North Carolina 3 67,386 6.6% 431 6.0%Illinois 2 49,901 4.9% 372 5.2%Maryland 1 53,459 5.3% 325 4.5%Florida 1 45,906 4.5% 213 2.9%Indiana 1 34,775 3.4% 205 2.8%California 2 21,581 2.1% 182 2.5%Washington 1 13,959 1.4% 117 1.6% ---------- ----------- --------- ------ --------- 36 $ 1,015,984 100.0% 7,224 100.0% ========== =========== ========= ====== =========(a) Excludes asset held for sale. Franklin Street Properties Corp. Earnings Release Supplementary Schedule E Portfolio and Other Supplementary Information (Unaudited & Approximated)Capital ExpendituresOwned Portfolio Six Months Ended Three Months Ended Nine Months Ended ------------------- ------------------- -------------------(in thousands) 30-Jun-12 30-Jun-11 30-Sep-12 30-Sep-11 30-Sep-12 30-Sep-11 --------- --------- --------- --------- --------- ---------Tenant improvements $ 5,719 $ 5,721 $ 2,854 $ 5,093 $ 8,573 $ 10,814Deferred leasing costs 3,539 5,386 1,104 1,322 4,643 6,708Building improvements 1,749 1,325 711 754 2,460 2,079 --------- --------- --------- --------- --------- --------- $ 11,007 $ 12,432 $ 4,669 $ 7,169 $ 15,676 $ 19,601 ========= ========= ========= ========= ========= =========Square foot & leased percentages September 30, December 31, 2012 2011 ------------- -------------Owned portfolio of commercial real estate (a) Number of properties 37 36 Square feet 7,439,195 7,052,068 Leased percentage 90% 89%Investments in non-consolidated REITs Number of properties 3 3 Square feet 2,016,260 2,001,542 Leased percentage 68% 87%Single Asset REITs (SARs) managed Number of properties 13 13 Square feet 3,322,589 3,322,639 Leased percentage 85% 80%Total owned, investments & managed properties (a) Number of properties 53 52 Square feet 12,778,044 12,376,249 Leased percentage 85% 86%(a) Includes asset held for sale.
