Gables Q1 Total Return Outperforms Sector

Apr 30, 2001, 01:00 ET from Gables Residential Trust

    ATLANTA, April 30 /PRNewswire/ -- Gables Residential (NYSE:   GBP) (the
 "Company"), today reported earnings for the first quarter that are in line
 with consensus estimates.  "Our annualized total return for the first quarter
 has outpaced the NAREIT apartment sector by 393 BP and the RMS index by 267
 BP," noted Chris Wheeler, CEO.  "Our strategy revolves around risk-adjusted
 returns, resilient markets and low volatility.  The strength of this approach
 has positioned us to continue outperforming the sector index."
     Funds from operations ("FFO") for the quarter was $22.7 million, or
 $0.76 per share (diluted) compared to $22.6 million, or $0.72 per share
 (diluted) for the comparable period of 2000.  Net income for the quarter was
 $0.38 per share (diluted) compared to $0.37 per share (diluted) in the
 comparable period of 2000.
     The Company will hold a conference call on May 1, 2001 at 11:00 am Eastern
 Time (EDT) to review the quarterly financial results, business highlights and
 outlook.  The number to call to participate is (877) 388-4378.  Identify the
 call as the Gables Residential First Quarter Earnings Call.  The number to
 hear a replay of the call is (800) 642-1687.  Access Code:  314535.  A webcast
 of the conference call will also be available on the Company's website at
 www.gables.com , with an on-line playback of the conference call available for
 30 days following the call.
 
     Operating Results for the Quarter Ended March 31, 2001 Compared to the
     Prior Year Period
 
     Same store revenues increased 3.2% and expense growth was 4.0%, resulting
 in 2.8% net operating income ("NOI") growth which was in line with the
 Company's budgets.
 
                    Same Store Communities Operating Results
 
 
     Market              1Q 01 NOI%      Revenues      Expense           NOI
 
     Atlanta                  28.5%          4.2%         2.0%          5.1%
     Houston                  25.8%          0.2%         4.6%         -2.1%
     So. Florida              21.7%          4.8%         3.6%          5.3%
     Austin                   10.1%          7.3%         7.3%          7.3%
 
     Dallas                    9.4%          4.9%         5.6%          4.4%
     Other                     4.5%         -3.1%         3.7%         -6.8%
 
     Total                   100.0%          3.2%         4.0%          2.8%
 
 
     As of March 31, 2001, the average occupancy of the stabilized portfolio
 was 95% and the average monthly rent per apartment home was $920, or $0.93 per
 square foot, compared to $873 per apartment home, or $0.88 per square foot, as
 of March 31, 2000.
 
     Development Activity
     During the quarter the Company announced the contribution of three
 development assets into a joint venture with JP Morgan Investment Management
 ("JPMIM").  Projected costs for the assets are $82 million.  The assets are
 Gables West Park Village, consisting of 320 apartment homes in Tampa, Gables
 Metropolitan II, consisting of 274 apartment homes in Atlanta, and Gables
 White Oak, consisting of 186 apartment homes in Houston.  The Company noted it
 raised capital through the venture format in order to hedge potential capital
 market risks in 2002 when the developments are expected to generate earnings.
 "We believe it is prudent to raise attractively priced capital now, especially
 given the uncertainty in the economy.  Our investors count on us to be
 defensive, predictable and have low volatility.  Raising this capital is
 consistent with these objectives," noted Wheeler.
     The Company will record a gain on this contribution of approximately
 $2.8 million which will be recognized when earned using the percentage of
 completion method since Gables serves as the developer and general contractor
 for the joint venture.  During the first quarter of 2001, the Company
 recognized approximately $460,000 of this gain.
     The Company's new investments are consistent with its research-driven
 strategy focused on six to eight markets characterized by high job growth and
 resiliency to national economic downturns.  Within these markets, the Company
 targets in-fill submarkets defined as areas with high per square foot prices
 for single family homes.  By investing in resilient, demand driven markets and
 submarkets with barriers to entry, the Company expects to achieve its
 objective of producing total returns that exceed the NAREIT multi-family
 sector average.
 
     Disposition Activity
     The Company sold 2.5 acres of land in the Buckhead neighborhood of Atlanta
 for $5.4 million during the quarter.  A gain of approximately $950,000 was
 recognized on the transaction.  During the quarter the Company also recognized
 $230,000 of deferred gain associated with a previous land sale.
 
     Acquisition Activity
     The Company acquired the partnership interests of its venture partner,
 JPMIM, in two assets in South Florida during the quarter.  The communities
 involved were Gables San Michele II, consisting of 343 apartment homes and
 Gables Palma Vista consisting of 189 apartment homes.  "We realized
 significant benefits for our shareowners from the venture financing and now
 have 100% of the upside associated with these core investments," stated Jordan
 Clark, Chief Investment Officer.  The Company expects its South Florida
 communities to have above average earnings growth during the next several
 years.
 
     Senior Unsecured Notes
     During the quarter, Gables completed a $150 million offering of five-year
 senior unsecured notes rated Baa2 by Moodys and BBB by S&P.  The notes yield
 7.29% to maturity with an all-in rate of approximately 7.46%.  The net
 proceeds from the offering of approximately $148.5 million were used to
 paydown borrowings under Gables' unsecured credit facilities and its $40
 million term loan.
 
     Non-Recurring Items
     The Company recorded a reserve of $400,000 during the first quarter
 associated with its equity investment in Broadband Residential, Inc. ("BBR").
 The Company supports BBR's business model but has determined a reserve for its
 equity investment was warranted due to uncertainties associated with BBR's
 ability to raise capital in the current economic environment.  Gables is
 moving forward with the application of high speed internet access throughout
 its portfolio.
     In late April, the Company suspended lease-up activities at Gables State
 Thomas Ravello in Dallas due to water infiltration issues associated with
 faulty roof design and construction.  The 290 unit community was 55% occupied.
 The Company has a 20% ownership interest in the community.  In spite of
 preliminary investigations into insurance proceeds, the Company recorded a
 construction reserve to earnings of $425,000 in association with planned
 remediation activities at the community.  Gables State Thomas Ravello is
 expected to be back in service prior to year-end.
 
     National Awards
     Gables was recognized by the National Association of Homebuilders ("NAHB")
 as the winner of two Pillars of the Industry Awards.  Gables Metropolitan I in
 Atlanta received recognition as the Best Multifamily Development by a REIT and
 Gables Palma Vista won in the Best Luxury Multifamily Development category.
 This marks the sixth year in a row that Gables has been a winner or a finalist
 in the Pillars of the Industry Awards, sponsored annually by the NAHB and
 awarded for excellence in the multifamily industry.  Gables is a winner of
 five previous Pillars Awards, including being named Property Management
 Company of the Year and Development Company of the Year, and twelve times has
 been a finalist in the competition.  Added Mr. Wheeler, "The Pillars of the
 Industry Awards focus attention on the best developments and best managers,
 and this scrutiny benefits our entire industry by raising the standard of
 excellence for everyone."
 
     Forward-Looking Statements
     This announcement 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.  The forward-looking
 statements contained in this release are statements that are subject to
 certain risks and uncertainties, including, but not limited to, possible
 changes in demand for apartment homes, the effects of economic conditions, the
 impact of competition and competitive pricing, changes in construction costs,
 the results of financing efforts, potential acquisitions under agreement, the
 effects of the Company's accounting policies and other matters detailed in the
 Company's filings with the Securities and Exchange Commission, including the
 Company's Annual Report on Form 10-K for the fiscal year ended December 31,
 2000 under the heading "Management's Discussion and Analysis of Financial
 Condition and Results of Operations -- Certain Factors Affecting Future
 Operating Results."
 
     Earnings Release Supplements
     The Company produces Earnings Release Supplements ("the Supplements") that
 provide detailed information regarding operating, development, redevelopment,
 disposition and acquisition activity.  These Supplements are available via the
 Company's website and through e-mail distribution.  Access to the Supplements
 through the Company's website is available at
 www.gables.com/1qearningsrelease .   If you would like to receive future press
 releases via e-mail, please register through the Company's website at
 http://www.gables.com/ccbn.cfm?script=1900&layout=11 .  Some items referenced
 in the earnings release may require the Adobe Acrobat 4.0 Reader.  If you do
 not have Adobe Acrobat 4.0 Reader, you may download it at the following
 website: http://www.adobe.com/products/acrobat/readstep.html .
 
     NAREIT Definition of FFO
     FFO is used as a measure of operating performance of the Company because
 FFO, together with net income and cash flows, provides investors with an
 additional basis to evaluate the ability of the Company to incur and service
 debt and to fund dividends and capital expenditures.  FFO is determined based
 on the definition that was adopted by the National Association of Real Estate
 Investment Trusts ("NAREIT") in October 1999 and became effective January 1,
 2000.  The Company's calculation of FFO may not be comparable to FFO reported
 by other REITs due to the fact that not all REITs use the same definition.
 
     About Gables
     With a mission of Taking Care of the Way People Live(R), Gables
 Residential has received national recognition for excellence in the
 management, development, acquisition and construction of luxury multi-family
 communities in high job growth markets.  The Company presently owns 84
 communities with 25,218 completed apartment homes and has an additional 10
 communities with 2,545 apartment homes under development or lease-up in the
 principal cities of Georgia, Texas, Tennessee and Florida.  For further
 information, please contact the Company at (770) 436-4600 or access the Gables
 web site at www.gables.com .
 
 
     Detailed schedules of financial information follow:
 
     GABLES RESIDENTIAL
     Selected Financial Information
     March 31, 2001
     (Unaudited and amounts in thousands, except for per share data)
 
                                                   For the three months ended
                                                             March 31,
                                                       2001              2000
     Statement of Operations Information:
     Revenues:
        Rental revenues                             $53,234           $54,398
        Other property revenues                       2,914             2,943
           Total property revenues                   56,148            57,341
       Development revenues, net                          7               696
       Other revenues                                 2,000             2,489
           Total other revenues                       2,007             3,185
           Total revenues                            58,155            60,526
 
     Expenses:
        Property operating and maintenance
         (exclusive of items
           shown separately below)                   18,071            18,571
        Depreciation and amortization                11,022            10,995
        Property management  - owned                  1,406             1,460
        Property management  - third party            1,156             1,020
        Interest expense and credit
         enhancement fees                            10,749            11,035
        Amortization of deferred financing
         costs                                          261               251
        General and administrative                    1,883             2,169
        Unusual items                                   400               ---
           Total expenses                            44,948            45,501
 
 
     Income before gain on sale of real
      estate assets                                  13,207            15,025
     Gain on sale of real estate assets               1,638               ---
 
     Income before minority interest                 14,845            15,025
     Minority interest of common
      unitholders in Operating Partnership           (2,527)           (2,468)
     Minority interest of preferred
      unitholders in Operating Partnership           (1,078)           (1,078)
 
     Net income                                      11,240            11,479
 
     Dividends to preferred shareholders             (2,443)           (2,443)
 
     Net income available to common
      shareholders                                   $8,797            $9,036
 
     Average common shares outstanding -
      basic                                          23,197            24,478
     Average common shares outstanding -
      diluted                                        30,012            31,179
 
     Net income per common share - basic              $0.38             $0.37
     Net income per common share - diluted            $0.38             $0.37
 
     Other Information:
     Funds from operations per common
      share - basic                                   $0.76             $0.72
     Funds from operations per common
      share - diluted                                 $0.76             $0.72
     Dividends declared per common share              $0.57             $0.53
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X07511751
 
 

SOURCE Gables Residential Trust
    ATLANTA, April 30 /PRNewswire/ -- Gables Residential (NYSE:   GBP) (the
 "Company"), today reported earnings for the first quarter that are in line
 with consensus estimates.  "Our annualized total return for the first quarter
 has outpaced the NAREIT apartment sector by 393 BP and the RMS index by 267
 BP," noted Chris Wheeler, CEO.  "Our strategy revolves around risk-adjusted
 returns, resilient markets and low volatility.  The strength of this approach
 has positioned us to continue outperforming the sector index."
     Funds from operations ("FFO") for the quarter was $22.7 million, or
 $0.76 per share (diluted) compared to $22.6 million, or $0.72 per share
 (diluted) for the comparable period of 2000.  Net income for the quarter was
 $0.38 per share (diluted) compared to $0.37 per share (diluted) in the
 comparable period of 2000.
     The Company will hold a conference call on May 1, 2001 at 11:00 am Eastern
 Time (EDT) to review the quarterly financial results, business highlights and
 outlook.  The number to call to participate is (877) 388-4378.  Identify the
 call as the Gables Residential First Quarter Earnings Call.  The number to
 hear a replay of the call is (800) 642-1687.  Access Code:  314535.  A webcast
 of the conference call will also be available on the Company's website at
 www.gables.com , with an on-line playback of the conference call available for
 30 days following the call.
 
     Operating Results for the Quarter Ended March 31, 2001 Compared to the
     Prior Year Period
 
     Same store revenues increased 3.2% and expense growth was 4.0%, resulting
 in 2.8% net operating income ("NOI") growth which was in line with the
 Company's budgets.
 
                    Same Store Communities Operating Results
 
 
     Market              1Q 01 NOI%      Revenues      Expense           NOI
 
     Atlanta                  28.5%          4.2%         2.0%          5.1%
     Houston                  25.8%          0.2%         4.6%         -2.1%
     So. Florida              21.7%          4.8%         3.6%          5.3%
     Austin                   10.1%          7.3%         7.3%          7.3%
 
     Dallas                    9.4%          4.9%         5.6%          4.4%
     Other                     4.5%         -3.1%         3.7%         -6.8%
 
     Total                   100.0%          3.2%         4.0%          2.8%
 
 
     As of March 31, 2001, the average occupancy of the stabilized portfolio
 was 95% and the average monthly rent per apartment home was $920, or $0.93 per
 square foot, compared to $873 per apartment home, or $0.88 per square foot, as
 of March 31, 2000.
 
     Development Activity
     During the quarter the Company announced the contribution of three
 development assets into a joint venture with JP Morgan Investment Management
 ("JPMIM").  Projected costs for the assets are $82 million.  The assets are
 Gables West Park Village, consisting of 320 apartment homes in Tampa, Gables
 Metropolitan II, consisting of 274 apartment homes in Atlanta, and Gables
 White Oak, consisting of 186 apartment homes in Houston.  The Company noted it
 raised capital through the venture format in order to hedge potential capital
 market risks in 2002 when the developments are expected to generate earnings.
 "We believe it is prudent to raise attractively priced capital now, especially
 given the uncertainty in the economy.  Our investors count on us to be
 defensive, predictable and have low volatility.  Raising this capital is
 consistent with these objectives," noted Wheeler.
     The Company will record a gain on this contribution of approximately
 $2.8 million which will be recognized when earned using the percentage of
 completion method since Gables serves as the developer and general contractor
 for the joint venture.  During the first quarter of 2001, the Company
 recognized approximately $460,000 of this gain.
     The Company's new investments are consistent with its research-driven
 strategy focused on six to eight markets characterized by high job growth and
 resiliency to national economic downturns.  Within these markets, the Company
 targets in-fill submarkets defined as areas with high per square foot prices
 for single family homes.  By investing in resilient, demand driven markets and
 submarkets with barriers to entry, the Company expects to achieve its
 objective of producing total returns that exceed the NAREIT multi-family
 sector average.
 
     Disposition Activity
     The Company sold 2.5 acres of land in the Buckhead neighborhood of Atlanta
 for $5.4 million during the quarter.  A gain of approximately $950,000 was
 recognized on the transaction.  During the quarter the Company also recognized
 $230,000 of deferred gain associated with a previous land sale.
 
     Acquisition Activity
     The Company acquired the partnership interests of its venture partner,
 JPMIM, in two assets in South Florida during the quarter.  The communities
 involved were Gables San Michele II, consisting of 343 apartment homes and
 Gables Palma Vista consisting of 189 apartment homes.  "We realized
 significant benefits for our shareowners from the venture financing and now
 have 100% of the upside associated with these core investments," stated Jordan
 Clark, Chief Investment Officer.  The Company expects its South Florida
 communities to have above average earnings growth during the next several
 years.
 
     Senior Unsecured Notes
     During the quarter, Gables completed a $150 million offering of five-year
 senior unsecured notes rated Baa2 by Moodys and BBB by S&P.  The notes yield
 7.29% to maturity with an all-in rate of approximately 7.46%.  The net
 proceeds from the offering of approximately $148.5 million were used to
 paydown borrowings under Gables' unsecured credit facilities and its $40
 million term loan.
 
     Non-Recurring Items
     The Company recorded a reserve of $400,000 during the first quarter
 associated with its equity investment in Broadband Residential, Inc. ("BBR").
 The Company supports BBR's business model but has determined a reserve for its
 equity investment was warranted due to uncertainties associated with BBR's
 ability to raise capital in the current economic environment.  Gables is
 moving forward with the application of high speed internet access throughout
 its portfolio.
     In late April, the Company suspended lease-up activities at Gables State
 Thomas Ravello in Dallas due to water infiltration issues associated with
 faulty roof design and construction.  The 290 unit community was 55% occupied.
 The Company has a 20% ownership interest in the community.  In spite of
 preliminary investigations into insurance proceeds, the Company recorded a
 construction reserve to earnings of $425,000 in association with planned
 remediation activities at the community.  Gables State Thomas Ravello is
 expected to be back in service prior to year-end.
 
     National Awards
     Gables was recognized by the National Association of Homebuilders ("NAHB")
 as the winner of two Pillars of the Industry Awards.  Gables Metropolitan I in
 Atlanta received recognition as the Best Multifamily Development by a REIT and
 Gables Palma Vista won in the Best Luxury Multifamily Development category.
 This marks the sixth year in a row that Gables has been a winner or a finalist
 in the Pillars of the Industry Awards, sponsored annually by the NAHB and
 awarded for excellence in the multifamily industry.  Gables is a winner of
 five previous Pillars Awards, including being named Property Management
 Company of the Year and Development Company of the Year, and twelve times has
 been a finalist in the competition.  Added Mr. Wheeler, "The Pillars of the
 Industry Awards focus attention on the best developments and best managers,
 and this scrutiny benefits our entire industry by raising the standard of
 excellence for everyone."
 
     Forward-Looking Statements
     This announcement 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.  The forward-looking
 statements contained in this release are statements that are subject to
 certain risks and uncertainties, including, but not limited to, possible
 changes in demand for apartment homes, the effects of economic conditions, the
 impact of competition and competitive pricing, changes in construction costs,
 the results of financing efforts, potential acquisitions under agreement, the
 effects of the Company's accounting policies and other matters detailed in the
 Company's filings with the Securities and Exchange Commission, including the
 Company's Annual Report on Form 10-K for the fiscal year ended December 31,
 2000 under the heading "Management's Discussion and Analysis of Financial
 Condition and Results of Operations -- Certain Factors Affecting Future
 Operating Results."
 
     Earnings Release Supplements
     The Company produces Earnings Release Supplements ("the Supplements") that
 provide detailed information regarding operating, development, redevelopment,
 disposition and acquisition activity.  These Supplements are available via the
 Company's website and through e-mail distribution.  Access to the Supplements
 through the Company's website is available at
 www.gables.com/1qearningsrelease .   If you would like to receive future press
 releases via e-mail, please register through the Company's website at
 http://www.gables.com/ccbn.cfm?script=1900&layout=11 .  Some items referenced
 in the earnings release may require the Adobe Acrobat 4.0 Reader.  If you do
 not have Adobe Acrobat 4.0 Reader, you may download it at the following
 website: http://www.adobe.com/products/acrobat/readstep.html .
 
     NAREIT Definition of FFO
     FFO is used as a measure of operating performance of the Company because
 FFO, together with net income and cash flows, provides investors with an
 additional basis to evaluate the ability of the Company to incur and service
 debt and to fund dividends and capital expenditures.  FFO is determined based
 on the definition that was adopted by the National Association of Real Estate
 Investment Trusts ("NAREIT") in October 1999 and became effective January 1,
 2000.  The Company's calculation of FFO may not be comparable to FFO reported
 by other REITs due to the fact that not all REITs use the same definition.
 
     About Gables
     With a mission of Taking Care of the Way People Live(R), Gables
 Residential has received national recognition for excellence in the
 management, development, acquisition and construction of luxury multi-family
 communities in high job growth markets.  The Company presently owns 84
 communities with 25,218 completed apartment homes and has an additional 10
 communities with 2,545 apartment homes under development or lease-up in the
 principal cities of Georgia, Texas, Tennessee and Florida.  For further
 information, please contact the Company at (770) 436-4600 or access the Gables
 web site at www.gables.com .
 
 
     Detailed schedules of financial information follow:
 
     GABLES RESIDENTIAL
     Selected Financial Information
     March 31, 2001
     (Unaudited and amounts in thousands, except for per share data)
 
                                                   For the three months ended
                                                             March 31,
                                                       2001              2000
     Statement of Operations Information:
     Revenues:
        Rental revenues                             $53,234           $54,398
        Other property revenues                       2,914             2,943
           Total property revenues                   56,148            57,341
       Development revenues, net                          7               696
       Other revenues                                 2,000             2,489
           Total other revenues                       2,007             3,185
           Total revenues                            58,155            60,526
 
     Expenses:
        Property operating and maintenance
         (exclusive of items
           shown separately below)                   18,071            18,571
        Depreciation and amortization                11,022            10,995
        Property management  - owned                  1,406             1,460
        Property management  - third party            1,156             1,020
        Interest expense and credit
         enhancement fees                            10,749            11,035
        Amortization of deferred financing
         costs                                          261               251
        General and administrative                    1,883             2,169
        Unusual items                                   400               ---
           Total expenses                            44,948            45,501
 
 
     Income before gain on sale of real
      estate assets                                  13,207            15,025
     Gain on sale of real estate assets               1,638               ---
 
     Income before minority interest                 14,845            15,025
     Minority interest of common
      unitholders in Operating Partnership           (2,527)           (2,468)
     Minority interest of preferred
      unitholders in Operating Partnership           (1,078)           (1,078)
 
     Net income                                      11,240            11,479
 
     Dividends to preferred shareholders             (2,443)           (2,443)
 
     Net income available to common
      shareholders                                   $8,797            $9,036
 
     Average common shares outstanding -
      basic                                          23,197            24,478
     Average common shares outstanding -
      diluted                                        30,012            31,179
 
     Net income per common share - basic              $0.38             $0.37
     Net income per common share - diluted            $0.38             $0.37
 
     Other Information:
     Funds from operations per common
      share - basic                                   $0.76             $0.72
     Funds from operations per common
      share - diluted                                 $0.76             $0.72
     Dividends declared per common share              $0.57             $0.53
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X07511751
 
 SOURCE  Gables Residential Trust