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Share Name | Share Symbol | Market | Type |
---|---|---|---|
NorthStar Realty Europe Corp | NYSE:NRE | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 17.02 | 0 | 01:00:00 |
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(Mark One)
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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2016
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or
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Maryland
(State or Other Jurisdiction of
Incorporation or Organization)
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32-0468861
(IRS Employer
Identification No.)
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Title of Class
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Name of Each Exchange on Which Registered
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Common Stock, $0.01 par value
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New York Stock Exchange
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Large accelerated filer
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o
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Accelerated filer
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x
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Non-accelerated filer
o
(Do not check if a
smaller reporting company)
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Smaller reporting company
o
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Index
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Page
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•
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the effect of economic conditions, particularly in Europe, on the valuation of our investments and on the tenants of the real property that we own;
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•
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the effect of the Mergers (as defined in Item 1. Business) on our business;
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•
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the ability of Colony NorthStar Inc., or CLNS, to scale its operations in Europe to effectively manage our company;
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•
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the unknown impact of the exit of the United Kingdom, or Brexit, or one or more other countries from the European Union, or EU, or the potential default of one or more countries in the EU or the potential break-up of the EU;
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•
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our ability to qualify and remain qualified as a real estate investment trust, or REIT;
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•
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adverse domestic or international economic geopolitical conditions and the impact on the commercial real estate industry;
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•
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volatility, disruption or uncertainty in the financial markets;
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•
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access to debt and equity capital and our liquidity;
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•
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our substantial use of leverage and our ability to comply with the terms of our borrowing arrangements;
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•
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our ability to monetize our assets on favorable terms or at all;
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•
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our ability to obtain mortgage financing on our real estate portfolio on favorable terms or at all;
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•
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our ability to acquire attractive investment opportunities and the impact of competition for attractive investment opportunities;
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•
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the effect of increased activist stockholders and stockholder activism generally;
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•
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the effects of being an externally-managed company, including our reliance on CLNS and its affiliates and sub-advisors/co-venturers in providing management services to us, the payment of substantial base management and incentive fees to our manager, the allocation of investments by CLNS among us and CLNS’s other sponsored or managed companies and strategic vehicles and various conflicts of interest in our relationship with CLNS;
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•
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performance of our investments relative to our expectations and the impact on our actual return on invested equity, as well as the cash provided by these investments and available for distribution;
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•
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restrictions on our ability to engage in certain activities and the requirement that we may be required to access capital at inopportune times as a result of our borrowings;
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•
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our ability to make borrowings under our credit facility;
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•
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the impact of adverse conditions affecting office properties;
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•
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illiquidity of properties in our portfolio;
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•
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our ability to realize current and expected return over the life of our investments;
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•
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tenant defaults or bankruptcy;
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•
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any failure in our due diligence to identify all relevant facts in our underwriting process or otherwise;
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•
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the impact of terrorism or hostilities involving Europe;
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•
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our ability to manage our costs in line with our expectations and the impact on our cash available for distribution, or CAD, and net operating income, or NOI, of our properties;
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•
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our ability to satisfy and manage our capital requirements;
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•
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environmental and regulatory requirements, compliance costs and liabilities relating to owning and operating properties in our portfolio and to our business in general;
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•
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effect of regulatory actions, litigation and contractual claims against us and our affiliates, including the potential settlement and litigation of such claims;
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•
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changes in European, international and domestic laws or regulations governing various aspects of our business;
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•
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our ability to effectively structure our investments in a tax efficient manner, including foreign, federal, state and local tax purposes;
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•
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the impact that a rise in future interest rates may have on our floating rate financing;
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•
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potential devaluation of foreign currencies, predominately the Euro and U.K. Pound Sterling, relative to the U.S. dollar due to quantitative easing in Europe, Brexit and/or other factors which could cause the U.S. dollar value of our investments to decline;
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•
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general foreign exchange risk associated with properties located in European countries located outside of the Euro Area, including the United Kingdom;
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•
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the loss of our exemption from the definition of an “investment company” under the Investment Company Act of 1940, as amended;
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•
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CLNS’ ability to hire and retain qualified personnel and potential changes to key personnel providing management services to us;
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•
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the lack of historical financial statements for properties we have acquired and may acquire in compliance with U.S. Securities and Exchange Commission, or SEC, requirements and U.S. generally accepted accounting principles, or U.S. GAAP, as well as the lack of familiarity of our tenants and third-party service providers with such requirements;
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•
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the potential failure to maintain effective internal controls and disclosure controls and procedures;
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•
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the historical consolidated financial statements included in this Annual Report on Form
10-K
not providing an accurate indication of our performance in the future or reflecting what our financial position, results of operations or cash flow would have been had we operated as an independent public company during the periods presented;
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•
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our status as an emerging growth company; and
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•
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compliance with the rules governing REITs.
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Portfolio by Geographic Location
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2016
(4)
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2015
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Total portfolio, at cost
(1)
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$2.0 billion
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Number of properties
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30
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|||
Number of countries
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6
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|||
Total square meters
(2)
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367,078
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|||
Weighted average occupancy
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84%
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|||
Weighted average lease term
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6.2 years
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|||
In-place rental income:
(3)
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|||
Core Markets
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83%
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|||
Other
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17%
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(1)
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Amount includes transaction costs incurred, deferred financing costs and other assets assumed and is translated using exchange rates as of
December 31, 2016
.
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(2)
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Based on contractual rentable area, located in many key European markets, including Frankfurt, Hamburg, Berlin, London and Paris.
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(3)
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In-place rental income represents gross rent adjusted for vacancies based on the rent roll as of
December 31, 2016
.
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(4)
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Excludes revenue from Belgium, Italy and Sweden in which we no longer operate due to asset sales.
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Portfolio
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Acquisition Date
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Primary Location(s)
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Property Type
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Cost
(1)
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Properties
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Ownership Interest
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U.K. Complex
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Sept-14
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United Kingdom
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Multi-tenant office
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$
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72
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1
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93%
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SEB Portfolio
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Apr-15
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Germany, United Kingdom, France
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Multi-tenant office
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922
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7
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95%
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(2)
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Internos Portfolio
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Apr-15
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Germany, France
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Office/Hotel/Industrial/Retail
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160
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7
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95%
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(2)
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IVG Portfolio
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Apr-15
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Germany, United Kingdom, France
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Multi-tenant office
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128
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9
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95%
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(2)
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Deka Portfolio
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Apr-15
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Germany
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Multi-tenant office
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58
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3
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95%
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(2)
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Trianon Tower
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Jul-15
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Germany
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Multi-tenant office
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611
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3
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95%
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(2)
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Total
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|
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|
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$
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1,951
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30
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(1)
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Amount includes transaction costs incurred, deferred financing costs and other assets assumed and is translated using exchange rates as of
December 31, 2016
.
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(2)
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We hold equity interests in these portfolios and are entitled to
100%
of net income (loss) based on the allocation formula, as set forth in the governing documents.
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Location
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Properties
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Carrying Value
(5)
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Sales Price
(3)
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Net Proceeds
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Realized Gain (Loss)
(4)
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|||||||||
Germany
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3
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$
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16,066
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$
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23,040
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$
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22,413
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$
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6,347
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France
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1
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22,316
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30,986
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30,668
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8,352
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||||
Other
(1)(2)
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18
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311,251
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334,225
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327,372
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16,121
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||||
Total
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22
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$
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349,633
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$
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388,251
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$
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380,453
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$
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30,820
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(1)
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Includes the sale of one non-core asset in February 2017.
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(2)
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Includes sales of assets in Portugal, Netherlands, Belgium and Sweden and assets outside our Core Market in Germany and the United Kingdom.
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(3)
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Net of associated property debt repayments.
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(4)
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Translated to the U.S. dollar using the average currency exchange rate for the year ended December 31, 2016.
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(5)
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Includes certain net assets of the company where we sold the underlying asset.
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Significant tenants:
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Industry
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Square Meters
(1)
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Weighted Average Lease Term (in years)
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Percentage of In-Place Rental Income
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DekaBank Deutsche Girozentrale
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Finance
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36,301
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7.4
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19%
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BNP PARIBAS RE
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Finance
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15,406
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3.1
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8%
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Deloitte Holding B.V.
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Legal, Tax & Management Consultancy
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23,684
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2.9
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6%
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Deutsche Bundesbank
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Finance
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15,304
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8.0
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5%
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BNP PARIBAS SA
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Finance
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11,235
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4.3
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5%
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Cushman & Wakefield LLP
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Legal, Tax & Management Consultancy
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5,150
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8.3
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5%
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Morgan Lewis & Bockius LLP
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Legal, Tax & Management Consultancy
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4,848
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8.7
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4%
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PAREXEL International GmbH
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Public Utilities & Telecommunications
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18,254
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17.5
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3%
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Moelis & Co UK LLP
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Legal, Tax & Management Consultancy
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3,366
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8.3
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3%
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Invesco UK Limited
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Finance
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2,043
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6.4
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2%
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(1)
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Based on contractual rentable area.
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Country
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Number of Properties
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Square Meters
(1)
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Weighted Average Lease Term (in years)
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Percentage of In-Place Rental Income
(3)
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Germany
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|
11
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|
154,293
|
|
|
7.6
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41%
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United Kingdom
|
|
5
|
|
46,520
|
|
|
7.1
|
|
26%
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France
|
|
4
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|
32,075
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|
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4.3
|
|
16%
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Other
(2)
|
|
10
|
|
134,190
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|
|
3.5
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|
17%
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Total
|
|
30
|
|
367,078
|
|
|
|
|
100%
|
(1)
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Based on contractual rentable area.
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(2)
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Includes assets in Portugal, Netherlands and Spain and assets outside our Core Market in Germany, the United Kingdom and France.
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(3)
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In-place rental income represents gross rent adjusted for vacancies based on the rent roll as of
December 31, 2016
.
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•
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regulate the ability of foreign persons or corporations to remove profits earned from activities within the country to the person’s or corporation’s country of origin;
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•
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regulate use of derivative instruments and our ability to hedge our risks related to fluctuations in interest rates and exchange rates.
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•
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have more than $1 billion in annual revenue in a fiscal year;
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•
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issue more than $1 billion of non-convertible debt during the preceding three-year period; or
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•
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become a “large accelerated filer” as defined in Exchange Act Rule 12b-2, which would occur at the end of the fiscal year after: (i) we have filed at least one annual report pursuant to the Exchange Act; (ii) we have been an SEC-reporting company for at least 12 months; and (iii) the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter.
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•
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require us to dedicate a large portion of our cash flow to pay principal and interest on our borrowings, which will reduce the availability of cash flow to fund working capital, capital expenditures and other business activities;
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•
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require us to maintain minimum unrestricted cash;
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•
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increase our vulnerability to general adverse economic and industry conditions;
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•
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require us to post additional reserves and other additional collateral to support our financing arrangements, which could reduce our liquidity and limit our ability to leverage our assets;
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•
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subject us to maintaining various debt, operating income, net worth, cash flow and other covenants and financial ratios;
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•
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limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
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•
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restrict our operating policies and ability to make strategic acquisitions, dispositions or exploit business opportunities;
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•
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require us to maintain a borrowing base of assets;
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•
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place us at a competitive disadvantage compared to our competitors that have fewer borrowings;
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•
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put us in a position that necessitates raising equity capital at a time that is unfavorable to us and dilutive to our stockholders;
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•
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limit our ability to borrow additional funds (even when necessary to maintain adequate liquidity), dispose of assets or make distributions to our stockholders; and
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•
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increase our cost of capital.
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•
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All of the rent payments under our leases are denominated in Euro or U.K. Pounds Sterling. A significant portion of our operating expenses and borrowings are also transacted in local currency. We report our results of operations and consolidated financial information in U.S. dollars. As a result, to the extent we are unable to fully hedge our exchange
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•
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While we seek to mitigate the risk of fluctuations in currency exchange rates by utilizing hedging strategies to reduce the impact of exchange rates fluctuations on our income, we do not employ any hedging techniques on our Euro or U.K. Pound Sterling denominated assets, which fully exposes our asset values to exchange rate risk.
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•
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a large increase in the amount of assets under management and a diversification of types of assets under management, which may create risks related to scaling and combining of the platforms necessary to effectively manage the combined assets of the managed entities and strategic ventures;
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•
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additional conflicts between and among the managed entities, strategic ventures and the other clients of our Manager, which may not be resolved in our favor;
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•
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certain managed entities or strategic vehicles may compete for investment opportunities allocated by our Manager and may adversely impact the extent of opportunities allocated to us; and
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•
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our Manager’s larger and newly combined team of management and employees may require time to become fully effective and may not be able to achieve its anticipated synergies, which may impact the management of our company.
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•
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investment objectives, strategy and criteria;
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•
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cash requirements and amount of funds available;
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•
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effect of the investment on the diversification of the portfolio, including by geography, size of investment, type of investment and risk of investment;
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•
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leverage policy and the availability of financing for the investment by each entity;
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•
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anticipated cash flow of the investment to be acquired;
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•
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income tax effects of the purchase;
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•
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the size of the investment;
|
•
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cost of capital;
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•
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risk return profiles;
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•
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targeted distribution rates;
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•
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anticipated future pipeline of suitable investments;
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•
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the expected holding period of the investment and the remaining term of our Manager’s managed company, if applicable;
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•
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affiliate and/or related party considerations; and
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•
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whether a strategic vehicle has received a special allocation (as defined in the investment allocation policy).
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•
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governmental laws, rules and policies including laws relating to the foreign ownership of real property or mortgages and laws relating to the ability of foreign persons or corporations to remove profits earned from activities within the country to the person’s or corporation’s country of origin;
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•
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translation and transaction risks related to fluctuations in foreign currency exchange rates;
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•
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adverse market conditions caused by inflation, deflation or other changes in national or local political and economic conditions;
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•
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challenges of complying with a wide variety of foreign laws, including corporate governance, operations, taxes and litigation;
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•
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changes in relative interest rates;
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•
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changes in the availability, cost and terms of borrowings resulting from varying national economic policies;
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•
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changes in real estate and other tax rates, the tax treatment of transaction structures and other changes in operating expenses in a particular country where we have an investment;
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•
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our REIT tax status not being respected under foreign laws, in which case any income or gains from foreign sources be subject to foreign taxes and withholding taxes;
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•
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lack of uniform accounting standards (including availability of information in accordance with accounting principles generally accepted in the United States, or U.S. GAAP);
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•
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changes in land use and zoning laws;
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•
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more stringent environmental laws or changes in such laws;
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•
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changes in the social stability or other political, economic or diplomatic developments in or affecting a country where we have an investment;
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•
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changes in applicable laws and regulations in the United States that affect foreign operations; and
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•
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legal and logistical barriers to enforcing our contractual rights in other countries, including insolvency regimes, landlord/tenant rights and ability to take possession of collateral.
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•
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our joint venture partner in an investment could become insolvent or bankrupt;
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•
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fraud or other misconduct by our joint venture partners;
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•
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we may share decision-making authority with our joint venture partner regarding certain major decisions affecting the ownership of the joint venture and the joint venture property, such as the sale of the property or the making of additional capital contributions for the benefit of the property, which may prevent us from taking actions that are opposed by our joint venture partner;
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•
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such joint venture partner may at any time have economic or business interests or goals that are or that become in conflict with our business interests or goals, including for example the operation of the properties owned by such joint venture;
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•
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such joint venture partner may be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives;
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•
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our joint venture partners may be structured differently than us for tax purposes and this could create conflicts of interest and risk to our REIT status; and
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•
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the terms of our joint ventures could restrict our ability to sell or transfer our interest to a third party when we desire on advantageous terms, which could result in reduced liquidity.
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•
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canceled any reference in the French commercial code, with respect to the variation of the rent of a renewed or revised lease, to the indice national trimestriel mesurant le coût de la construction, or the Construction Cost Index, and replaced it with the Commercial Rents Index and the Retail Rental Index;
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•
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removed the possibility to contractually remove the right of the tenant to terminate the lease at the end of every three-year period, with the exception of leases for premises to be used exclusively as office space; and
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•
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made it mandatory for the property owner to incur certain charges.
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•
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interest rate and/or currency hedging can be expensive, particularly during periods of rising and volatile interest rates;
|
•
|
available interest rate and/or currency hedging may not correspond directly with the risk for which protection is sought;
|
•
|
the duration of the hedge may not match the duration of the related liability or investment;
|
•
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our hedging opportunities may be limited by the treatment of income from hedging transactions under the rules determining REIT qualification;
|
•
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the credit quality of the party owing money on the hedge may be downgraded to such an extent that it impairs our ability to sell or assign our side of the hedging transaction;
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•
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the counterparties with which we trade may cease making markets and quoting prices in such instruments, which may render us unable to enter into an offsetting transaction with respect to an open position;
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•
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the party owing money in the hedging transaction may default on its obligation to pay; and
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•
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we may purchase a hedge that turns out not to be necessary,
i.e.
, a hedge that is out of the money.
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•
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“business combination”
provisions that, subject to limitations, prohibit certain business combinations between an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our outstanding shares of voting stock or an affiliate or associate of the corporation who, at any time within the two-year period immediately prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then outstanding stock of the corporation) or an affiliate of any interested stockholder and us for five years after the most recent date on which the stockholder becomes an interested stockholder, and thereafter imposes two super-majority stockholder voting requirements on these combinations; and
|
•
|
“control share”
provisions that provide that holders of “control shares” of our company (defined as voting shares of stock that, if aggregated with all other shares of stock owned or controlled by the acquirer or in respect of which the acquirer is able to exercise or direct the exercise of voting power (except solely by virtue of a revocable proxy), would entitle the acquirer to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of issued and outstanding “control shares,” subject to certain exceptions) have no voting rights except to the extent approved by stockholders by the affirmative vote of at least two-thirds of all of the votes entitled to be cast on the matter, excluding all interested shares.
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•
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we would not be allowed a deduction for dividends paid to stockholders in computing our taxable income and would be subject to U.S. federal income tax at regular corporate rates;
|
•
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we could be subject to the U.S. federal alternative minimum tax and possibly increased state and local taxes; and
|
•
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unless we are entitled to relief under certain U.S. federal income tax laws, we could not re-elect REIT status until the fifth calendar year after the year in which we failed to qualify as a REIT.
|
Location
|
|
Rentable square meters
(1)
|
|
Percentage Leased
|
|
Number of Buildings
|
|
Lease Expiration Date
(2)
|
|
Gross Carrying Value
(3)(4)
|
|
Borrowings
(4)
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|
|||||
Germany
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Frankfurt
|
|
75,356
|
|
|
87%
|
|
4
|
|
Mar-24
|
|
$
|
553,432
|
|
|
$
|
355,957
|
|
|
Hamburg
|
|
34,293
|
|
|
84%
|
|
2
|
|
Jan-21
|
|
101,602
|
|
|
68,423
|
|
|
||
Berlin
|
|
30,539
|
|
|
100%
|
|
3
|
|
Sep-31
|
|
73,131
|
|
|
42,961
|
|
|
||
Köln
|
|
10,622
|
|
|
85%
|
|
1
|
|
Aug-21
|
|
28,770
|
|
|
16,394
|
|
|
||
Other
|
|
16,859
|
|
|
80%
|
|
4
|
(7)
|
Mar-26
|
|
18,178
|
|
|
8,819
|
|
|
||
Subtotal Germany
|
|
167,669
|
|
|
|
|
14
|
|
|
|
775,113
|
|
|
492,554
|
|
|
||
United Kingdom
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
London West End
|
|
10,447
|
|
|
100%
|
|
1
|
|
Jan-24
|
|
172,333
|
|
|
126,330
|
|
|
||
London City
|
|
11,312
|
|
|
99%
|
|
1
|
|
Mar-25
|
|
132,362
|
|
|
99,767
|
|
|
||
London (Other)
|
|
24,762
|
|
|
98%
|
|
3
|
|
Nov-22
|
|
64,427
|
|
|
71,716
|
|
|
||
Other
|
|
3,168
|
|
|
100%
|
|
1
|
|
Feb-21
|
|
8,701
|
|
|
4,512
|
|
|
||
Subtotal United Kingdom
|
|
49,689
|
|
|
|
|
6
|
|
|
|
377,823
|
|
|
302,325
|
|
|
||
France
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Paris (Office)
|
|
32,075
|
|
|
100%
|
|
4
|
|
Apr-21
|
|
263,534
|
|
|
159,495
|
|
|
||
Paris (Logistics)
|
|
59,095
|
|
|
45%
|
|
1
|
|
Mar-17
|
|
43,107
|
|
|
19,521
|
|
|
||
Subtotal France
|
|
91,170
|
|
|
|
|
5
|
|
|
|
306,641
|
|
|
179,016
|
|
|
||
Netherlands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Rotterdam
|
|
37,827
|
|
|
100%
|
|
1
|
|
Dec-19
|
|
140,435
|
|
|
75,885
|
|
|
||
Other
|
|
12,374
|
|
|
57%
|
|
2
|
(8)
|
Feb-25
|
|
7,448
|
|
|
4,138
|
|
|
||
Subtotal Netherlands
|
|
50,201
|
|
|
|
|
3
|
|
|
|
147,883
|
|
|
80,023
|
|
|
||
Spain
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Madrid
|
|
4,025
|
|
|
100%
|
|
1
|
|
Feb-20
|
|
6,111
|
|
|
—
|
|
|
||
Portugal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Lisbon
|
|
4,324
|
|
|
65%
|
|
1
|
|
Jan-19
|
|
11,122
|
|
|
—
|
|
|
||
Albufeira
|
|
11,150
|
|
|
100%
|
|
1
|
(5)
|
Feb-27
|
|
12,877
|
|
|
—
|
|
|
||
Subtotal Portugal
|
|
15,474
|
|
|
|
|
2
|
|
|
|
23,999
|
|
|
—
|
|
|
||
Total
|
|
378,228
|
|
|
|
|
31
|
|
|
|
$
|
1,637,570
|
|
|
$
|
1,053,918
|
|
(6)
|
(1)
|
Based on contractual rentable area.
|
(2)
|
Based on initial term and represents the weighted average lease term if more than one lease.
|
(3)
|
Represents operating real estate before accumulated depreciation and excludes purchase price allocations related to net intangible and other assets and liabilities as of
December 31, 2016
. Refer to Note 3. “Operating Real Estate” of Part II, Item 8. “Financial Statements and Supplementary Data.”
|
(4)
|
Represents the carrying value which are translated using the exchange rate as of
December 31, 2016
for all properties.
|
(5)
|
Includes one asset classified as held for sale and sold in February 2017 for
$23.6 million
.
|
Period
|
|
Declaration Date
|
|
High
|
|
Low
|
|
Close
|
|
Dividends Per Share
|
||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fourth Quarter
(1)
|
|
March 8, 2017
|
|
$
|
13.04
|
|
|
$
|
9.39
|
|
|
$
|
12.57
|
|
|
$
|
0.15
|
|
Third Quarter
|
|
November 1, 2016
|
|
$
|
11.30
|
|
|
$
|
8.50
|
|
|
$
|
10.95
|
|
|
$
|
0.15
|
|
Second Quarter
|
|
August 3, 2016
|
|
$
|
12.17
|
|
|
$
|
8.71
|
|
|
$
|
9.25
|
|
|
$
|
0.15
|
|
First Quarter
|
|
May 10, 2016
|
|
$
|
11.93
|
|
|
$
|
7.81
|
|
|
$
|
11.60
|
|
|
$
|
0.15
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fourth Quarter
|
|
March 15, 2016
|
|
$
|
16.00
|
|
|
$
|
9.50
|
|
|
$
|
11.81
|
|
|
$
|
0.15
|
|
Third Quarter
(2)
|
|
November 23, 2015
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.15
|
|
(1)
|
On
March 8, 2017
, we declared a dividend of
$0.15
per share of common stock. This dividend is expected to be paid on
March 24, 2017
to stockholders of record as of the close of business on
March 20, 2017
.
|
(2)
|
On November 2, 2015, our common stock began trading on the NYSE under the symbol “NRE”. On November 23, 2015, we declared our first dividend of $0.15 per share on common stock for the three months ended September 30, 2015.
|
Period
|
|
Total Number of Shares Repurchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Program
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
(1)
|
||||||
October 1-October 31
|
|
1,481,386
|
|
|
$
|
10.40
|
|
|
1,481,386
|
|
|
$
|
12,325,060
|
|
November 1-November 30
|
|
1,196,942
|
|
|
$
|
10.30
|
|
|
1,196,942
|
|
|
$
|
—
|
|
(1)
|
On November 24, 2015, we announced that our board of directors authorized the repurchase of up to $100 million of our outstanding common stock. The authorization was fulfilled on November 24, 2016.
|
•
|
The consolidated financial statements for the year ended
December 31, 2016
represents our results of operations following the Spin-off and the first full year of activity as a stand-alone company.
|
•
|
The consolidated financial statements for the year ended December 31, 2015 represents: (i) our results of operations following the Spin-off which represents two months of activity as a stand-alone company; and (ii) our results of operations of the European Real Estate Business as if the transferred business was the business for the periods in which common control was present and an allocation of costs related to us for the period from January 1, 2015 to October 31, 2015.
|
•
|
The combined consolidated financial statements for the period from January 1, 2014 to September 15, 2014 represents (i) the Prior Owner Period results of operations, which represents the ownership period of a third party (refer to Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policy”); and (ii) an allocation of costs related to the launch of the European Real Estate Business. The combined consolidated financial statements for the period from September 16, 2014 to December 31, 2014 represents: (i) our results of operations of the European Real Estate Business as if the transferred business was the business for the periods in which common control was present; and (ii) an allocation of costs related to us.
|
•
|
The combined consolidated financial statements for the
year ended
December 31, 2013 represents: (i) the Prior Owner Period results of operations, which represents the ownership period of a third party; and (ii) an allocation of costs related to the launch of the European Real Estate Business.
|
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||||||
|
|
Year Ended December 31,
|
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
|
Year Ended
December 31, |
||||||||||
|
|
2016
|
|
2015
|
|
2014
|
|
2014
|
|
2013
|
||||||||||
|
|
(Dollars in thousands, except per share and dividend data)
|
||||||||||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rental income
|
|
$
|
124,321
|
|
|
$
|
101,023
|
|
|
$
|
1,740
|
|
|
$
|
4,455
|
|
|
$
|
6,300
|
|
Escalation income
|
|
25,173
|
|
|
18,822
|
|
|
982
|
|
|
2,707
|
|
|
3,569
|
|
|||||
Total expenses
|
|
226,166
|
|
|
258,002
|
|
|
35,332
|
|
|
13,569
|
|
|
12,163
|
|
|||||
Net income (loss)
|
|
(62,502
|
)
|
|
(144,143
|
)
|
|
(33,906
|
)
|
|
(3,007
|
)
|
|
1,633
|
|
|||||
Net income (loss) attributable to NorthStar Realty Europe Corp. common stockholders
|
|
(61,753
|
)
|
|
(143,136
|
)
|
|
(33,630
|
)
|
|
(3,007
|
)
|
|
1,633
|
|
|||||
Earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
(1.07
|
)
|
|
$
|
(2.30
|
)
|
|
$
|
(0.53
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
0.03
|
|
Diluted
|
|
$
|
(1.07
|
)
|
|
$
|
(2.30
|
)
|
|
$
|
(0.53
|
)
|
|
$
|
(0.05
|
)
|
|
$
|
0.03
|
|
Dividends per share of common stock
|
|
$
|
0.60
|
|
|
$
|
0.30
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||
|
|
(Dollars in thousands)
|
||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
$
|
66,308
|
|
|
$
|
283,844
|
|
|
$
|
2,100
|
|
|
$
|
1,350
|
|
Operating real estate, net
|
|
1,550,847
|
|
|
2,085,157
|
|
|
54,896
|
|
|
59,201
|
|
||||
Total assets
|
|
1,845,392
|
|
|
2,683,050
|
|
|
160,271
|
|
|
90,951
|
|
||||
Total borrowings
|
|
1,149,119
|
|
|
1,758,408
|
|
|
75,910
|
|
|
47,895
|
|
||||
Total liabilities
|
|
1,243,875
|
|
|
1,885,739
|
|
|
80,197
|
|
|
67,367
|
|
||||
Redeemable non-controlling interest
|
|
1,610
|
|
|
1,569
|
|
|
—
|
|
|
—
|
|
||||
Total equity
|
|
599,907
|
|
|
795,742
|
|
|
80,074
|
|
|
23,584
|
|
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||||||
|
|
Year Ended December 31,
|
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
|
Year Ended
December 31, |
||||||||||
|
|
2016
|
|
2015
|
|
2014
|
|
2014
|
|
2013
|
||||||||||
|
|
(Dollars in thousands)
|
||||||||||||||||||
Other Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flow provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating activities
|
|
$
|
28,130
|
|
|
$
|
(50,180
|
)
|
|
$
|
(34,222
|
)
|
|
$
|
(2,681
|
)
|
|
$
|
7,245
|
|
Investing activities
|
|
391,624
|
|
|
(1,900,532
|
)
|
|
(149,403
|
)
|
|
(2,307
|
)
|
|
(7,263
|
)
|
|||||
Financing activities
|
|
(630,856
|
)
|
|
2,231,566
|
|
|
188,408
|
|
|
(46
|
)
|
|
(656
|
)
|
|||||
Effect of foreign currency translation on cash and cash equivalents
|
|
(6,434
|
)
|
|
890
|
|
|
(2,683
|
)
|
|
3,722
|
|
|
545
|
|
|
|
Germany
|
|
United Kingdom
|
|
France
|
|
Other
|
|
Total
|
|||||
Acquired
|
|
|
|
|
|
|
|
|
|
|
|||||
2014
(1)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
2015
|
|
14
|
|
|
4
|
|
|
5
|
|
|
28
|
|
|
51
|
|
2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
2017
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Subtotal
|
|
14
|
|
|
5
|
|
|
5
|
|
|
28
|
|
|
52
|
|
Sold
|
|
|
|
|
|
|
|
|
|
|
|||||
2014
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
2015
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
2016
|
|
3
|
|
|
—
|
|
|
1
|
|
|
14
|
|
|
18
|
|
2017
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Subtotal
|
|
3
|
|
|
—
|
|
|
1
|
|
|
18
|
|
|
22
|
|
Total
|
|
11
|
|
|
5
|
|
|
4
|
|
|
10
|
|
|
30
|
|
(1)
|
We committed to acquire the majority of our properties in 2014.
|
•
|
Year ended December 31, 2016 represents our results of operations following the Spin-off and the first full year of activity as a stand-alone company. During the year, we disposed of 18 assets.
|
•
|
Year ended December 31, 2015 represents: (i) our results of operations following the Spin-off and two months of activity as a stand-alone company; and (ii) our results of operations of the European Real Estate Business as if the transferred business was the business for the periods in which common control was present and an allocation of costs related to us for the period from January 1, 2015 to October 31, 2015. We acquired the IVG Portfolio, Deka Portfolio, Internos Portfolio and SEB Portfolio in April 2015 and Trianon Tower in July 2015. In December 2015, we disposed of three assets.
|
•
|
The period from January 1, 2014 to September 15, 2014 represents: (i) the Prior Owner Period results of operations, which represents the ownership period of a third party (refer to Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policy”); and (ii) an allocation of costs related to the launch of the European Real Estate Business. The period from September 16, 2014 to December 31, 2014 represents: (i) our results of operations of the European Real Estate Business as if the transferred business was the business for the periods in which common control was present; and (ii) an allocation of costs related to us. We acquired the U.K. Complex in September 2014.
|
|
Year Ended December 31,
|
|
Increase (Decrease)
|
||||||||
|
2016
|
|
2015
|
|
Amount
|
||||||
Revenues
|
|
|
|
|
|
||||||
Rental income
|
$
|
124,321
|
|
|
$
|
101,023
|
|
|
$
|
23,298
|
|
Escalation income
|
25,173
|
|
|
18,822
|
|
|
6,351
|
|
|||
Other revenue
|
1,721
|
|
|
694
|
|
|
1,027
|
|
|||
Total revenues
|
151,215
|
|
|
120,539
|
|
|
30,676
|
|
|||
Expenses
|
|
|
|
|
|
||||||
Properties - operating expenses
|
35,892
|
|
|
26,559
|
|
|
9,333
|
|
|||
Interest expense
|
41,439
|
|
|
36,129
|
|
|
5,310
|
|
|||
Transaction costs
|
2,610
|
|
|
120,101
|
|
|
(117,491
|
)
|
|||
Impairment losses
|
27,468
|
|
|
1,710
|
|
|
25,758
|
|
|||
Management fee, related party
|
14,068
|
|
|
2,333
|
|
|
11,735
|
|
|||
Other expenses
|
12,376
|
|
|
10,535
|
|
|
1,841
|
|
|||
General and administrative expenses
|
8,077
|
|
|
3,502
|
|
|
4,575
|
|
|||
Compensation expense
|
19,257
|
|
|
850
|
|
|
18,407
|
|
|||
Depreciation and amortization
|
64,979
|
|
|
56,283
|
|
|
8,696
|
|
|||
Total expenses
|
226,166
|
|
|
258,002
|
|
|
(31,836
|
)
|
|||
Other income (loss)
|
|
|
|
|
|
||||||
Unrealized gain (loss) on investments and other
|
(11,257
|
)
|
|
(8,731
|
)
|
|
(2,526
|
)
|
|||
Realized gain (loss) on investments and other
|
26,448
|
|
|
1,376
|
|
|
25,072
|
|
|||
Income (loss) before income tax benefit (expense)
|
(59,760
|
)
|
|
(144,818
|
)
|
|
85,058
|
|
|||
Income tax benefit (expense)
|
(2,742
|
)
|
|
675
|
|
|
(3,417
|
)
|
|||
Net income (loss)
|
$
|
(62,502
|
)
|
|
$
|
(144,143
|
)
|
|
$
|
81,641
|
|
|
Same Store Real Estate Segment
|
|
Increase (Decrease)
|
|
Corporate
|
|
Other
(2)
|
|
Total
|
|||||||||||||||||||||||||||||
|
2016
|
|
2015
|
|
Amount
|
|
%
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||||||||||||
Total Revenue
|
$
|
32,546
|
|
|
$
|
33,063
|
|
|
$
|
(517
|
)
|
|
1.6
|
%
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(676
|
)
|
|
$
|
11,064
|
|
|
$
|
31,870
|
|
|
$
|
44,127
|
|
Properties - operating expenses
|
8,938
|
|
|
7,507
|
|
|
1,431
|
|
|
19.1
|
%
|
|
—
|
|
|
—
|
|
|
(310
|
)
|
|
2,287
|
|
|
8,628
|
|
|
9,794
|
|
|||||||||
Interest expense
|
6,823
|
|
|
7,930
|
|
|
(1,107
|
)
|
|
14.0
|
%
|
|
1,221
|
|
|
5,358
|
|
|
(89
|
)
|
|
1,450
|
|
|
7,955
|
|
|
14,738
|
|
|||||||||
Total expenses
(1)
|
17,180
|
|
|
27,150
|
|
|
(9,970
|
)
|
|
36.7
|
%
|
|
12,848
|
|
|
9,478
|
|
|
(90
|
)
|
|
6,634
|
|
|
29,938
|
|
|
43,262
|
|
|||||||||
Unrealized gains (loss) on investments and other
|
3,868
|
|
|
(1,003
|
)
|
|
4,871
|
|
|
485.6
|
%
|
|
5,937
|
|
|
3,780
|
|
|
(192
|
)
|
|
(155
|
)
|
|
9,613
|
|
|
2,622
|
|
|||||||||
Realized gains (loss) on investments and other
|
(279
|
)
|
|
(4,427
|
)
|
|
4,148
|
|
|
93.7
|
%
|
|
(1,451
|
)
|
|
—
|
|
|
20,896
|
|
|
5,836
|
|
|
19,166
|
|
|
1,409
|
|
|||||||||
Income (loss) before income tax (benefit) provision
|
$
|
3,194
|
|
|
$
|
(14,954
|
)
|
|
$
|
18,148
|
|
|
121.4
|
%
|
|
$
|
(9,583
|
)
|
|
$
|
(11,056
|
)
|
|
$
|
20,517
|
|
|
$
|
6,374
|
|
|
$
|
14,128
|
|
|
$
|
(19,636
|
)
|
(1)
|
Includes depreciation and amortization expense, transaction costs, general and administrative expense, management fees and other expenses.
|
(2)
|
Represents impact of assets sales net of foreign currency exchange.
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||
|
|
2016
|
|
2015
|
||||||||||||||||||||
|
|
Real Estate
|
|
Corporate
|
|
Total
|
|
Real Estate
|
|
Corporate
|
|
Total
|
||||||||||||
Change in fair value of:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivatives, at fair value
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate caps
|
|
$
|
(14,936
|
)
|
|
$
|
—
|
|
|
$
|
(14,936
|
)
|
|
$
|
(8,897
|
)
|
|
$
|
—
|
|
|
$
|
(8,897
|
)
|
Foreign currency forwards
|
|
—
|
|
|
4,653
|
|
|
4,653
|
|
|
—
|
|
|
417
|
|
|
417
|
|
||||||
Foreign currency remeasurement
|
|
(104
|
)
|
|
(870
|
)
|
|
(974
|
)
|
|
28
|
|
|
(279
|
)
|
|
(251
|
)
|
||||||
Total unrealized gain (loss) on investments and other
|
|
$
|
(15,040
|
)
|
|
$
|
3,783
|
|
|
$
|
(11,257
|
)
|
|
$
|
(8,869
|
)
|
|
$
|
138
|
|
|
$
|
(8,731
|
)
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||
|
|
2016
|
|
2015
|
||||||||||||||||||||
|
|
Real Estate
|
|
Corporate
|
|
Total
|
|
Real Estate
|
|
Corporate
|
|
Total
|
||||||||||||
Sale of real estate investments
(1)
|
|
$
|
18,596
|
|
|
$
|
—
|
|
|
$
|
18,596
|
|
|
$
|
5,962
|
|
|
$
|
—
|
|
|
$
|
5,962
|
|
Foreign currency transactions
(2)
|
|
15,957
|
|
|
—
|
|
|
15,957
|
|
|
297
|
|
|
—
|
|
|
297
|
|
||||||
Write-off of deferred financing costs
(3)
|
|
(2,534
|
)
|
|
(4,784
|
)
|
|
(7,318
|
)
|
|
(4,883
|
)
|
|
—
|
|
|
(4,883
|
)
|
||||||
Net cash payments on derivatives
|
|
—
|
|
|
(787
|
)
|
|
(787
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total realized gain (loss)
|
|
$
|
32,019
|
|
|
$
|
(5,571
|
)
|
|
$
|
26,448
|
|
|
$
|
1,376
|
|
|
$
|
—
|
|
|
$
|
1,376
|
|
(1)
|
Excludes escrow arrangements entered into for specific warranties in relation to the sales.
|
(2)
|
Includes
$17.7 million
relating to the reclassification of the currency translation adjustment, or CTA, from a component of accumulated OCI to realized gain (losses) due to the sale of certain real estate assets, offset by the realized loss on the repayment of the intercompany loans in different currencies.
|
(3)
|
The Corporate segment relates to the Senior Notes repurchases.
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
|
|
||||||||||
|
Year Ended December 31,
|
|
September 16 to December 31,
|
|
January 1 to September 15,
|
|
|
||||||||
|
|
|
Increase
|
||||||||||||
|
2015
|
|
2014
|
|
2014
|
|
(Decrease)
|
||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Rental income
|
$
|
101,023
|
|
|
$
|
1,740
|
|
|
$
|
4,455
|
|
|
$
|
94,828
|
|
Escalation income
|
18,822
|
|
|
982
|
|
|
2,707
|
|
|
15,133
|
|
||||
Other revenue
|
694
|
|
|
39
|
|
|
1,290
|
|
|
(635
|
)
|
||||
Total revenues
|
120,539
|
|
|
2,761
|
|
|
8,452
|
|
|
109,326
|
|
||||
Expenses
|
|
|
|
|
|
|
|
||||||||
Properties - operating expenses
|
26,559
|
|
|
1,181
|
|
|
3,113
|
|
|
22,265
|
|
||||
Interest expense
|
36,129
|
|
|
165
|
|
|
3,486
|
|
|
32,478
|
|
||||
Transaction costs
|
120,101
|
|
|
31,691
|
|
|
—
|
|
|
88,410
|
|
||||
Management fee, related party
|
2,333
|
|
|
—
|
|
|
—
|
|
|
2,333
|
|
||||
Impairment losses
|
1,710
|
|
|
—
|
|
|
—
|
|
|
1,710
|
|
||||
Other expenses
|
10,535
|
|
|
—
|
|
|
—
|
|
|
10,535
|
|
||||
General and administrative expenses
|
3,502
|
|
|
1,207
|
|
|
4,676
|
|
|
(2,381
|
)
|
||||
Compensation expense
|
850
|
|
|
—
|
|
|
—
|
|
|
850
|
|
||||
Depreciation and amortization
|
56,283
|
|
|
1,088
|
|
|
2,294
|
|
|
52,901
|
|
||||
Total expenses
|
258,002
|
|
|
35,332
|
|
|
13,569
|
|
|
209,101
|
|
||||
Other income (loss)
|
|
|
|
|
|
|
|
||||||||
Unrealized gain (loss) on investments and other
|
(8,731
|
)
|
|
(1,335
|
)
|
|
2,110
|
|
|
(9,506
|
)
|
||||
Realized gain (loss) on investments and other
|
1,376
|
|
|
—
|
|
|
—
|
|
|
1,376
|
|
||||
Income (loss) before income tax benefit (expense)
|
(144,818
|
)
|
|
(33,906
|
)
|
|
(3,007
|
)
|
|
(107,905
|
)
|
||||
Income tax benefit (expense)
|
675
|
|
|
—
|
|
|
—
|
|
|
675
|
|
||||
Net income (loss)
|
$
|
(144,143
|
)
|
|
$
|
(33,906
|
)
|
|
$
|
(3,007
|
)
|
|
$
|
(107,230
|
)
|
•
|
our operating expenses and investment activities, including the repurchase of our common stock;
|
•
|
acquisitions of our target assets and related ongoing commitments;
|
•
|
distributions to our stockholders;
|
•
|
principal and interest payments on our borrowings; and
|
•
|
income tax liabilities of taxable REIT subsidiaries and we are subject to limitations as a REIT.
|
•
|
net proceeds from asset sales;
|
•
|
financings secured by our assets such as mortgage notes, long-term senior and subordinate corporate capital such as revolving credit facilities, senior term loans, senior notes, senior exchangeable notes and perpetual preferred stock and common stock;
|
•
|
cash on hand;
|
•
|
cash flow generated from our investments, both from operations and return of capital; and
|
•
|
investment-level financing.
|
•
|
Year ended December 31, 2016 represents our results of operations following the Spin-off and the first full year of activity as a stand-alone company.
|
•
|
Year ended December 31, 2015 represents: (i) our results of operations following the Spin-off and two months of activity as a stand-alone company; and (ii) our results of operations of the European Real Estate Business as if the transferred business was the business for the periods in which common control was present and an allocation of costs related to us for the period from January 1, 2015 to October 31, 2015.
|
•
|
The period from January 1, 2014 to September 15, 2014 represents: (i) the Prior Owner Period results of operations, which represents the ownership period of a third party (refer to “Critical Accounting Policy” below for more information); and (ii) an allocation of costs related to the launch of the European Real Estate Business. The period from September 16, 2014 to December 31, 2014 represents: (i) our results of operations of the European Real Estate Business as if the transferred business was the business for the periods in which common control was present; and (ii) an allocation of costs related to us.
|
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||
|
|
Year Ended
December 31, |
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
||||||||
Cash flow provided by (used in):
|
|
2016
|
|
2015
|
|
2014
|
|
2014
|
||||||||
Operating activities
|
|
$
|
28,130
|
|
|
$
|
(50,180
|
)
|
|
$
|
(34,222
|
)
|
|
$
|
(2,681
|
)
|
Investing activities
|
|
391,624
|
|
|
(1,900,532
|
)
|
|
(149,403
|
)
|
|
(2,307
|
)
|
||||
Financing activities
|
|
(630,856
|
)
|
|
2,231,566
|
|
|
188,408
|
|
|
(46
|
)
|
||||
Effect of foreign currency translation on cash and cash equivalents
|
|
(6,434
|
)
|
|
890
|
|
|
(2,683
|
)
|
|
3,722
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
|
$
|
(217,536
|
)
|
|
$
|
281,744
|
|
|
$
|
2,100
|
|
|
$
|
(1,312
|
)
|
|
|
Payments Due by Period
|
||||||||||||||||||
|
|
Total
(1)
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than 5 years
|
||||||||||
Mortgage and other notes payable
|
|
$
|
1,162,211
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
211,122
|
|
|
$
|
951,089
|
|
Estimated interest payments
(2)
|
|
659,017
|
|
|
22,052
|
|
|
48,428
|
|
|
53,603
|
|
|
534,934
|
|
|||||
Total
|
|
$
|
1,821,228
|
|
|
$
|
22,052
|
|
|
$
|
48,428
|
|
|
$
|
264,725
|
|
|
$
|
1,486,023
|
|
(1)
|
Amounts denominated in foreign currencies are translated to the U.S. dollar using the currency exchange rate as of
December 31, 2016
.
|
(2)
|
Represents GBP LIBOR, EURIBOR or the applicable index plus the respective spread and foreign currency exchange rate as of
December 31, 2016
was used to estimate payments for our floating-rate liabilities.
|
•
|
any equity we issue in exchange or conversion of exchangeable or stock-settlable notes;
|
•
|
any other issuances by us of common equity, preferred equity or other forms of equity, including but not limited to limited partnership interests in the Operating Partnership, which are structured as profits interests, or LTIP units (excluding units issued to us and equity-based compensation, but including issuances related to an acquisition, investment, joint venture or partnership); and
|
•
|
cumulative CAD, if any, in excess of cumulative distributions paid on common stock, LTIP Units or other equity awards which began with our fiscal quarter ended March 31, 2016.
|
•
|
the product of: (a) 15% and (b) our CAD before such incentive fee, divided by the weighted average shares outstanding for the calendar quarter, of any amount in excess of $0.30 per share and up to $0.36 per share; plus
|
•
|
the product of: (a) 25% and (b) our CAD before such incentive fee, divided by the weighted average shares outstanding for the calendar quarter, of any amount in excess of $0.36 per share;
|
•
|
multiplied by our weighted average shares outstanding for the calendar quarter.
|
|
December 31, 2016
|
||||||
|
Three Months Ended
|
|
Year Ended
|
||||
Net income (loss) attributable to common stockholders
|
$
|
13,859
|
|
|
$
|
(61,753
|
)
|
Non-controlling interests
|
43
|
|
|
(749
|
)
|
||
|
|
|
|
||||
Adjustments:
|
|
|
|
||||
Depreciation and amortization items
(1)
|
22,609
|
|
|
93,913
|
|
||
Impairment losses
|
—
|
|
|
27,468
|
|
||
Unrealized (gain) loss from fair value adjustments
|
(9,613
|
)
|
|
11,257
|
|
||
Realized (gain) loss on investments
(2)
|
(18,858
|
)
|
|
(27,235
|
)
|
||
Transaction costs and other
(3)
|
1,884
|
|
|
9,217
|
|
||
CAD
|
$
|
9,924
|
|
|
$
|
52,118
|
|
(1)
|
Three months ended December 31, 2016 represents an adjustment to exclude depreciation and amortization of
$13.7 million
, net amortization of above/below market leases of
$0.3 million
, amortization of deferred financing costs of
$1.6 million
and amortization of equity-based compensation of
$7.0 million
. Year ended December 31, 2016 represents an adjustment to exclude depreciation and amortization of
$65.0 million
, net amortization of above/below market leases of
$2.6 million
, amortization of deferred financing costs of
$7.1 million
and amortization of equity-based compensation of
$19.3 million
.
|
(2)
|
Three months ended December 31, 2016 includes an adjustment to exclude a
$15.8 million
realized net gain related to the sale of real estate investment, a
$4.5 million
realized net gain related to foreign currency transactions, a
$1.5 million
realized loss related to the write-off of the deferred financing costs associated with the repayment of our mortgage and other note payables and excludes
$0.3 million
of realized gain on the net cash received from derivatives. Year ended December 31, 2016 includes an adjustment to exclude a
$18.6 million
realized net gain related to the sale of real estate investment, a
$16.0 million
realized net gain related to foreign currency transactions, a
$7.3 million
realized loss related to the write-off of the deferred financing costs associated with the repayment of our mortgage and other note payables and excludes a
$0.8 million
realized loss on the net cash received from derivatives.
|
(3)
|
Three months ended December 31, 2016 represents an adjustment to exclude
$0.9 million
of bad debt expense and
$1.0 million
of taxes associated with the capital gain tax on the sale of real estate investments. Year ended December 31, 2016 represents an adjustment to exclude
$1.3 million
of bad debt expense,
$2.6 million
of transaction expense and
$5.3 million
of taxes associated with the capital gain tax on the sale of real estate investments.
|
|
December 31, 2016
|
||||||
|
Three Months Ended
|
|
Year Ended
|
||||
Rental income
|
$
|
25,700
|
|
|
$
|
124,321
|
|
Escalation income
|
5,347
|
|
|
25,173
|
|
||
Other revenue
|
823
|
|
|
1,721
|
|
||
Total property and other revenues
|
31,870
|
|
|
151,215
|
|
||
Properties - operating expenses
|
8,628
|
|
|
35,892
|
|
||
Adjustments:
|
|
|
|
||||
Amortization and other items
(1)
|
691
|
|
|
3,756
|
|
||
NOI
|
$
|
23,933
|
|
|
$
|
119,079
|
|
(1)
|
Three months ended December 31, 2016 primarily includes
$0.9 million
of bad debt expense, offset by
$0.2 million
of amortization of above/below market rent. Year ended December 31, 2016 primarily includes
$1.3 million
of bad debt expense and
$2.5 million
of amortization of above/below market rent.
|
(2)
|
The following table presents a reconciliation of NOI of our real estate segment to net income (loss) for the three months and year ended December 31, 2016 (dollars in thousands):
|
NOI
|
$
|
23,933
|
|
|
$
|
119,079
|
|
Adjustments:
|
|
|
|
||||
Interest expense
|
(6,734
|
)
|
|
(30,974
|
)
|
||
Other expenses
|
(2,770
|
)
|
|
(12,307
|
)
|
||
Depreciation and amortization
|
(13,716
|
)
|
|
(64,979
|
)
|
||
Unrealized gain (loss) on investments and other
|
3,675
|
|
|
(15,040
|
)
|
||
Realized gain (loss) on investments and other
|
20,616
|
|
|
32,019
|
|
||
Income tax benefit (expense)
|
(227
|
)
|
|
(2,742
|
)
|
||
Other items
|
(457
|
)
|
|
(31,054
|
)
|
||
Net income (loss) - Real estate segment
|
$
|
24,320
|
|
|
$
|
(5,998
|
)
|
Remaining segments
(i)
|
(10,461
|
)
|
|
(55,755
|
)
|
||
Net income (loss) attributable to common stockholders
|
$
|
13,859
|
|
|
$
|
(61,753
|
)
|
(i)
|
Represents the net income (loss) in our corporate segment to reconcile to total net income (loss).
|
|
|
Page
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Assets
|
|
|
|
||||
Operating real estate, gross
|
$
|
1,614,432
|
|
|
$
|
2,120,460
|
|
Less: accumulated depreciation
|
(63,585
|
)
|
|
(35,303
|
)
|
||
Operating real estate, net
|
1,550,847
|
|
|
2,085,157
|
|
||
Cash and cash equivalents
|
66,308
|
|
|
283,844
|
|
||
Restricted cash
|
10,242
|
|
|
20,871
|
|
||
Receivables, net of allowance of $553 and $115 as of December 31, 2016 and 2015, respectively
|
6,015
|
|
|
9,663
|
|
||
Assets held for sale
|
28,208
|
|
|
6,094
|
|
||
Derivative assets, at fair value
|
13,729
|
|
|
23,792
|
|
||
Intangible assets, net
|
148,403
|
|
|
241,519
|
|
||
Other assets, net
|
21,640
|
|
|
12,110
|
|
||
Total assets
|
$
|
1,845,392
|
|
|
$
|
2,683,050
|
|
Liabilities
|
|
|
|
||||
Mortgage and other notes payable, net
|
$
|
1,149,119
|
|
|
$
|
1,424,610
|
|
Senior notes, net
|
—
|
|
|
333,798
|
|
||
Accounts payable and accrued expenses
|
28,004
|
|
|
39,964
|
|
||
Due to related party (refer to Note 5)
|
4,991
|
|
|
3,995
|
|
||
Intangible liabilities, net
|
30,802
|
|
|
40,718
|
|
||
Liabilities held for sale
|
2,041
|
|
|
—
|
|
||
Other liabilities
|
28,918
|
|
|
42,654
|
|
||
Total liabilities
|
1,243,875
|
|
|
1,885,739
|
|
||
Commitments and contingencies
|
|
|
|
||||
Redeemable non-controlling interest (refer to Note 8)
|
1,610
|
|
|
1,569
|
|
||
Equity
|
|
|
|
||||
NorthStar Realty Europe Corp. Stockholders’ Equity
|
|
|
|
||||
Preferred stock, $0.01 par value, 200,000,000 shares authorized, no shares issued and outstanding as of December 31, 2016 and 2015
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value, 1,000,000,000 shares authorized, 55,395,143 and 59,325,730 shares issued and outstanding as of December 31, 2016 and 2015, respectively
|
554
|
|
|
593
|
|
||
Additional paid-in capital
|
925,473
|
|
|
968,662
|
|
||
Retained earnings (accumulated deficit)
|
(282,769
|
)
|
|
(186,246
|
)
|
||
Accumulated other comprehensive income (loss)
|
(51,424
|
)
|
|
2,560
|
|
||
Total NorthStar Realty Europe Corp. stockholders’ equity
|
591,834
|
|
|
785,569
|
|
||
Non-controlling interests
|
8,073
|
|
|
10,173
|
|
||
Total equity
|
599,907
|
|
|
795,742
|
|
||
Total liabilities and equity
|
$
|
1,845,392
|
|
|
$
|
2,683,050
|
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
|
||||||||||||
|
Year Ended
December 31, |
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
|
||||||||
|
2016
(1)
|
|
2015
(1)
|
|
2014
(1)
|
|
2014
(1)
|
|
||||||||
Revenues
|
|
|
|
|
|
|
|
|
||||||||
Rental income
|
$
|
124,321
|
|
|
$
|
101,023
|
|
|
$
|
1,740
|
|
|
$
|
4,455
|
|
|
Escalation income
|
25,173
|
|
|
18,822
|
|
|
982
|
|
|
2,707
|
|
|
||||
Other revenue
|
1,721
|
|
|
694
|
|
|
39
|
|
|
1,290
|
|
|
||||
Total revenues
|
151,215
|
|
|
120,539
|
|
|
2,761
|
|
|
8,452
|
|
|
||||
Expenses
|
|
|
|
|
|
|
|
|
||||||||
Properties - operating expenses
|
35,892
|
|
|
26,559
|
|
|
1,181
|
|
|
3,113
|
|
|
||||
Interest expense
|
41,439
|
|
|
36,129
|
|
|
165
|
|
|
3,486
|
|
|
||||
Transaction costs
|
2,610
|
|
|
120,101
|
|
|
31,691
|
|
|
—
|
|
|
||||
Impairment losses
|
27,468
|
|
|
1,710
|
|
|
—
|
|
|
—
|
|
|
||||
Management fee, related party
(2)
|
14,068
|
|
|
2,333
|
|
|
—
|
|
|
—
|
|
|
||||
Other expenses
|
12,376
|
|
|
10,535
|
|
|
—
|
|
|
—
|
|
|
||||
General and administrative expenses
|
8,077
|
|
|
3,502
|
|
|
1,207
|
|
|
4,676
|
|
|
||||
Compensation expense (refer to Note 6)
|
19,257
|
|
|
850
|
|
|
—
|
|
|
—
|
|
|
||||
Depreciation and amortization
|
64,979
|
|
|
56,283
|
|
|
1,088
|
|
|
2,294
|
|
|
||||
Total expenses
|
226,166
|
|
|
258,002
|
|
|
35,332
|
|
|
13,569
|
|
|
||||
Other income (loss)
|
|
|
|
|
|
|
|
|
|
|
||||||
Unrealized gain (loss) on investments and other (refer to Note 10)
|
(11,257
|
)
|
|
(8,731
|
)
|
|
(1,335
|
)
|
|
2,110
|
|
|
||||
Realized gain (loss) on investments and other
|
26,448
|
|
|
1,376
|
|
|
—
|
|
|
—
|
|
|
||||
Income (loss) before income tax benefit (expense)
|
(59,760
|
)
|
|
(144,818
|
)
|
|
(33,906
|
)
|
|
(3,007
|
)
|
|
||||
Income tax benefit (expense)
|
(2,742
|
)
|
|
675
|
|
|
—
|
|
|
—
|
|
|
||||
Net income (loss)
|
(62,502
|
)
|
|
(144,143
|
)
|
|
(33,906
|
)
|
|
(3,007
|
)
|
|
||||
Net (income) loss attributable to non-controlling interests
|
749
|
|
|
1,007
|
|
|
276
|
|
|
—
|
|
|
||||
Net income (loss) attributable to NorthStar Realty Europe Corp. common stockholders
|
$
|
(61,753
|
)
|
|
$
|
(143,136
|
)
|
|
$
|
(33,630
|
)
|
|
$
|
(3,007
|
)
|
|
Earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|||||||
Basic
|
$
|
(1.07
|
)
|
|
$
|
(2.30
|
)
|
(3)
|
$
|
(0.53
|
)
|
(3)
|
$
|
(0.05
|
)
|
(3)
|
Diluted
|
$
|
(1.07
|
)
|
|
$
|
(2.30
|
)
|
(3)
|
$
|
(0.53
|
)
|
(3)
|
$
|
(0.05
|
)
|
(3)
|
Weighted average number of shares:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
57,875,479
|
|
|
62,183,638
|
|
(3)
|
62,987,863
|
|
(3)
|
62,987,863
|
|
(3)
|
||||
Diluted
|
58,564,986
|
|
|
62,865,124
|
|
(3)
|
62,987,863
|
|
(3)
|
62,987,863
|
|
(3)
|
(1)
|
The consolidated financial statements for the
year ended
December 31, 2016
and for the period from November 1, 2015 to December 31, 2015 represent the Company’s results of operations following the Spin-off on October 31, 2015. The consolidated financial statements for the period from January 1, 2015 to October 31, 2015 and the combined consolidated financial statements the period from September 16, 2014 to December 31, 2014 represent: (i) the Company’s results of operations of the European Real Estate Business as if the transferred business was the business for the periods in which common control was present (refer to Notes 1 and 2); and (ii) an allocation of costs related to the Company. The period from January 1, 2014 to September 15, 2014 represents: (i) the Prior Owner Period results of operations, which represents the ownership period of a third party; and (ii) an allocation of costs related to the launch of the European real estate business. As a result, results of operations for the
year ended
December 31, 2016
may not be comparable to the Company’s results of operations reported for the prior periods presented.
|
(2)
|
The Company began paying fees on November 1, 2015, in connection with the management agreement with the Manager (refer to Note 5).
|
(3)
|
Basic and diluted earnings per common shares for the year ended December 31, 2014 was calculated using the common stock distributed on November 1, 2015 in connection with the Spin-off (refer to Note 7).
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||
|
Year Ended
December 31, |
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
||||||||
|
2016
|
|
2015
|
|
2014
|
|
2014
|
||||||||
Net income (loss)
|
$
|
(62,502
|
)
|
|
$
|
(144,143
|
)
|
|
$
|
(33,906
|
)
|
|
$
|
(3,007
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment, net
|
(55,226
|
)
|
|
6,971
|
|
|
(4,648
|
)
|
|
(57
|
)
|
||||
Total other comprehensive income (loss)
|
(55,226
|
)
|
|
6,971
|
|
|
(4,648
|
)
|
|
(57
|
)
|
||||
Comprehensive income (loss)
|
(117,728
|
)
|
|
(137,172
|
)
|
|
(38,554
|
)
|
|
(3,064
|
)
|
||||
Comprehensive (income) loss attributable to non-controlling interests
|
1,991
|
|
|
1,082
|
|
|
588
|
|
|
—
|
|
||||
Comprehensive income (loss) attributable to NorthStar Realty Europe Corp. common stockholders
|
$
|
(115,737
|
)
|
|
$
|
(136,090
|
)
|
|
$
|
(37,966
|
)
|
|
$
|
(3,064
|
)
|
(1)
|
Excludes
$0.2 million
net income allocated to redeemable non-controlling interest.
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||
|
Year Ended
December 31, |
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
||||||||
|
2016
|
|
2015
|
|
2014
|
|
2014
|
||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(62,502
|
)
|
|
$
|
(144,143
|
)
|
|
$
|
(33,906
|
)
|
|
$
|
(3,007
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization
|
64,979
|
|
|
56,283
|
|
|
1,088
|
|
|
2,294
|
|
||||
Amortization of deferred financing costs
|
7,117
|
|
|
5,936
|
|
|
18
|
|
|
—
|
|
||||
Amortization of equity-based compensation
|
18,239
|
|
|
837
|
|
|
—
|
|
|
—
|
|
||||
Amortization of discount on borrowings
|
—
|
|
|
—
|
|
|
—
|
|
|
846
|
|
||||
Allowance for uncollectible accounts
|
1,294
|
|
|
115
|
|
|
—
|
|
|
—
|
|
||||
Unrealized (gain) loss on investments and other
|
11,257
|
|
|
8,669
|
|
|
1,335
|
|
|
(2,110
|
)
|
||||
Realized (gain) loss on investments and other
|
(26,448
|
)
|
|
(1,376
|
)
|
|
—
|
|
|
—
|
|
||||
Impairment losses
|
27,468
|
|
|
1,710
|
|
|
—
|
|
|
—
|
|
||||
Foreign currency loss on deposits included in transaction costs
|
—
|
|
|
6,402
|
|
|
—
|
|
|
—
|
|
||||
Amortization of capitalized above/below market leases
|
2,463
|
|
|
1,191
|
|
|
37
|
|
|
37
|
|
||||
Straight line rental income
|
(6,705
|
)
|
|
(5,695
|
)
|
|
(270
|
)
|
|
(352
|
)
|
||||
Deferred income taxes, net
|
(4,952
|
)
|
|
(2,992
|
)
|
|
—
|
|
|
—
|
|
||||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
||||||||
Restricted cash
|
(2,717
|
)
|
|
(16,483
|
)
|
|
(2,839
|
)
|
|
1,170
|
|
||||
Receivables
|
(1,890
|
)
|
|
(7,844
|
)
|
|
(57
|
)
|
|
189
|
|
||||
Other assets
|
(3,063
|
)
|
|
(1,023
|
)
|
|
(1,726
|
)
|
|
—
|
|
||||
Accounts payable and accrued expenses
|
(4,461
|
)
|
|
28,551
|
|
|
549
|
|
|
(1,979
|
)
|
||||
Due to related party
|
987
|
|
|
3,447
|
|
|
—
|
|
|
—
|
|
||||
Other liabilities
|
7,064
|
|
|
16,235
|
|
|
1,549
|
|
|
231
|
|
||||
Net cash provided by (used in) operating activities
|
28,130
|
|
|
(50,180
|
)
|
|
(34,222
|
)
|
|
(2,681
|
)
|
||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
||||||||
Acquisition of operating real estate
|
—
|
|
|
(1,921,511
|
)
|
|
(89,484
|
)
|
|
—
|
|
||||
Improvements of operating real estate
|
(10,413
|
)
|
|
(3,003
|
)
|
|
(161
|
)
|
|
(2,307
|
)
|
||||
Proceeds from sale of operating real estate
|
395,226
|
|
|
22,623
|
|
|
—
|
|
|
—
|
|
||||
Other assets
|
(4,432
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Investment deposits
|
—
|
|
|
|
|
(59,758
|
)
|
|
—
|
|
|||||
Changes in restricted cash
|
11,243
|
|
|
1,359
|
|
|
—
|
|
|
—
|
|
||||
Net cash provided by (used in) investing activities
|
391,624
|
|
|
(1,900,532
|
)
|
|
(149,403
|
)
|
|
(2,307
|
)
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
||||||||
Borrowings from mortgage and other notes payable
|
11,770
|
|
|
1,224,327
|
|
|
77,660
|
|
|
481
|
|
||||
Repayment of mortgage and other notes payable
|
(200,666
|
)
|
|
(127,280
|
)
|
|
—
|
|
|
(527
|
)
|
||||
Borrowings from credit facility
|
65,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Repayment of credit facility
|
(65,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Proceeds from issuance of Senior Notes
|
—
|
|
|
340,000
|
|
|
—
|
|
|
—
|
|
||||
Repurchase of Senior Notes
|
(273,028
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Repayment of Senior Notes
|
(67,200
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Payment of financing costs
|
(3,938
|
)
|
|
(33,470
|
)
|
|
(643
|
)
|
|
—
|
|
||||
Settlement of derivatives
|
(787
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Purchase of derivative instruments
|
(414
|
)
|
|
(31,069
|
)
|
|
(1,249
|
)
|
|
—
|
|
||||
Tax withholding related to vesting of equity-based compensation
|
(2,546
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Repurchase of common stock
|
(58,616
|
)
|
|
(38,082
|
)
|
|
—
|
|
|
—
|
|
||||
Changes on restricted cash
|
—
|
|
|
—
|
|
|
(2,562
|
)
|
|
—
|
|
||||
Contribution of NorthStar Realty
|
—
|
|
|
250,000
|
|
|
—
|
|
|
—
|
|
||||
Dividends
|
(35,184
|
)
|
|
(9,584
|
)
|
|
—
|
|
|
—
|
|
||||
Net transactions with NorthStar Realty
|
—
|
|
|
653,534
|
|
|
115,200
|
|
|
—
|
|
||||
Contributions from non-controlling interest
|
—
|
|
|
3,190
|
|
|
2
|
|
|
—
|
|
||||
Distributions to non-controlling interest
|
(247
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net cash provided by (used in) financing activities
|
(630,856
|
)
|
|
2,231,566
|
|
|
188,408
|
|
|
(46
|
)
|
||||
Effect of foreign currency translation on cash and cash equivalents
|
(6,434
|
)
|
|
890
|
|
|
(2,683
|
)
|
|
3,722
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
(217,536
|
)
|
|
281,744
|
|
|
2,100
|
|
|
(1,312
|
)
|
||||
Cash and cash equivalents—beginning of period
|
283,844
|
|
|
2,100
|
|
|
—
|
|
|
1,350
|
|
||||
Cash and cash equivalents—end of period
|
$
|
66,308
|
|
|
$
|
283,844
|
|
|
$
|
2,100
|
|
|
$
|
38
|
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||
|
Year Ended
December 31, |
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
||||||||
|
2016
|
|
2015
|
|
2014
|
|
2014
|
||||||||
Supplemental disclosure of non-cash investing and financing activities:
|
|
|
|
|
|
|
|
||||||||
Reclassification of operating real estate to assets held for sale
|
$
|
22,327
|
|
|
$
|
5,318
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Reclassification related to measurement adjustments and other
|
827
|
|
|
5,291
|
|
|
—
|
|
|
—
|
|
||||
Reclassification of intangibles to assets held for sale
|
2,045
|
|
|
776
|
|
|
—
|
|
|
—
|
|
||||
Reclassification of operating real estate to intangible assets/liabilities
|
—
|
|
|
170,694
|
|
|
—
|
|
|
—
|
|
||||
Reclassification of other assets in investing activities to assets held for sale
|
2,523
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Formation of Operating Partnership
|
—
|
|
|
8,749
|
|
|
—
|
|
|
—
|
|
||||
Assumption of mortgage note payable upon acquisition
|
—
|
|
|
273,021
|
|
|
—
|
|
|
—
|
|
||||
Reclassification of other assets to operating real estate
|
—
|
|
|
52,245
|
|
|
—
|
|
|
—
|
|
||||
Reclassification of other assets and liabilities to held for sale
|
740
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Retirement of shares of common stock
|
—
|
|
|
3,342
|
|
|
—
|
|
|
—
|
|
||||
Assumption of working capital items upon acquisition
|
—
|
|
|
2,569
|
|
|
—
|
|
|
—
|
|
||||
Assumption of deferred tax liabilities and corresponding goodwill
|
—
|
|
|
24,491
|
|
|
—
|
|
|
—
|
|
||||
Reallocation of interest in Operating Partnership
|
2,252
|
|
|
852
|
|
|
—
|
|
|
—
|
|
||||
Amounts payable relating to financing costs
|
—
|
|
|
1,808
|
|
|
—
|
|
|
—
|
|
||||
Accrued capital expenditures and deferred assets
|
1,975
|
|
|
692
|
|
|
—
|
|
|
—
|
|
||||
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
||||||||
Payment of interest expense
|
$
|
33,483
|
|
|
$
|
24,273
|
|
|
$
|
2,355
|
|
|
$
|
2,286
|
|
Payment of income tax
|
1,928
|
|
|
1,298
|
|
|
—
|
|
|
—
|
|
1.
|
Formation and Organization
|
2.
|
Summary of Significant Accounting Policies
|
Category:
|
|
Term:
|
Building
|
|
40 years
|
Building improvements
|
|
Lesser of the useful life or remaining life of the building
|
Building leasehold interests
|
|
Lesser of 40 years or remaining term of the lease
|
Tenant improvements
|
|
Lesser of the useful life or remaining term of the lease
|
(1)
|
Translated to the U.S. dollar using the currency exchange rate as of December 31, 2016.
|
|
December 31, 2016
(1)
|
|
December 31, 2015
|
||||||||||||||||||||
|
Gross Amount
|
|
Accumulated Amortization
|
|
Net
|
|
Gross Amount
|
|
Accumulated Amortization
|
|
Net
|
||||||||||||
Intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
In-place lease
|
$
|
84,743
|
|
|
$
|
(29,012
|
)
|
|
$
|
55,731
|
|
|
$
|
121,004
|
|
|
$
|
(20,120
|
)
|
|
$
|
100,884
|
|
Above-market lease
|
36,704
|
|
|
(8,198
|
)
|
|
28,506
|
|
|
53,236
|
|
|
(5,806
|
)
|
|
47,430
|
|
||||||
Below-market ground lease
|
51,218
|
|
|
(832
|
)
|
|
50,386
|
|
|
70,971
|
|
|
(618
|
)
|
|
70,353
|
|
||||||
Goodwill
(2)
|
13,780
|
|
|
N/A
|
|
|
13,780
|
|
|
22,852
|
|
|
NA
|
|
|
22,852
|
|
||||||
Total
|
$
|
186,445
|
|
|
$
|
(38,042
|
)
|
|
$
|
148,403
|
|
|
$
|
268,063
|
|
|
$
|
(26,544
|
)
|
|
$
|
241,519
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Intangible liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Below-market lease
|
$
|
34,163
|
|
|
$
|
(8,104
|
)
|
|
$
|
26,059
|
|
|
$
|
40,213
|
|
|
$
|
(4,490
|
)
|
|
$
|
35,723
|
|
Above-market ground lease
|
4,839
|
|
|
(96
|
)
|
|
4,743
|
|
|
5,026
|
|
|
(31
|
)
|
|
4,995
|
|
||||||
Total
|
$
|
39,002
|
|
|
$
|
(8,200
|
)
|
|
$
|
30,802
|
|
|
$
|
45,239
|
|
|
$
|
(4,521
|
)
|
|
$
|
40,718
|
|
(1)
|
As of December 31, 2016, the weighted average amortization period for above-market leases, below-market leases and in-place leases is
7.1 years
,
9.8 years
and
6.1 years
, respectively. As of December 31, 2015, the weighted average amortization period for above-market leases, below-market leases and in-place leases is
6.8 years
,
7.5 years
and
5.3 years
, respectively.
|
(2)
|
Represents goodwill associated with certain share-deal acquisitions of the New European Investments in exchange for shares in the underlying portfolios. The goodwill and a corresponding deferred tax liability was recorded at acquisition based on tax basis differences.
|
Balance as of December 31, 2015
|
|
$
|
22,852
|
|
Disposal of goodwill
(1)
|
|
(8,561
|
)
|
|
Adjustments from foreign currency translation
|
|
(511
|
)
|
|
Balance as of December 31, 2016
|
|
$
|
13,780
|
|
|
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||
|
|
|
Year Ended
December 31, |
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
||||||||
|
Statements of operations location:
|
|
2016
|
|
2015
|
|
2014
|
|
2014
|
||||||||
Amortization of above-market leases, net of acquired below-market leases
|
Rental income / properties - operating expenses
|
|
$
|
1,961
|
|
|
$
|
1,763
|
|
|
$
|
37
|
|
|
$
|
61
|
|
Amortization of other intangible assets
|
Depreciation and amortization expense
|
|
19,543
|
|
|
20,468
|
|
|
558
|
|
|
742
|
|
|
|
Intangible Assets
|
|
Intangible Liabilities
|
||||||||||||||||
Years Ending December 31:
|
|
In-place Leases, Net
|
|
Above-market Leases, Net
|
|
Below-market Ground Lease Value, Net
|
|
Below-market Leases, Net
|
|
Above-market Ground Lease Value, Net
|
||||||||||
2017
|
|
11,265
|
|
|
4,284
|
|
|
453
|
|
|
3,056
|
|
|
65
|
|
|||||
2018
|
|
11,038
|
|
|
4,226
|
|
|
453
|
|
|
3,048
|
|
|
65
|
|
|||||
2019
|
|
10,533
|
|
|
4,187
|
|
|
453
|
|
|
3,024
|
|
|
65
|
|
|||||
2020
|
|
7,139
|
|
|
3,714
|
|
|
453
|
|
|
2,721
|
|
|
65
|
|
|||||
2021
|
|
6,164
|
|
|
3,646
|
|
|
453
|
|
|
2,572
|
|
|
65
|
|
|||||
Thereafter
|
|
9,592
|
|
|
8,449
|
|
|
48,121
|
|
|
11,638
|
|
|
4,419
|
|
|||||
Total
|
|
$
|
55,731
|
|
|
$
|
28,506
|
|
|
$
|
50,386
|
|
|
$
|
26,059
|
|
|
$
|
4,744
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Other assets:
|
|
|
|
||||
Prepaid expenses
|
$
|
1,951
|
|
|
$
|
3,041
|
|
Deferred costs, net
|
3,029
|
|
|
2,007
|
|
||
Deferred tax assets, net
|
—
|
|
|
220
|
|
||
Straight-line rent
|
10,182
|
|
|
5,869
|
|
||
Escrow receivable
|
6,168
|
|
|
—
|
|
||
Other
|
310
|
|
|
973
|
|
||
Total
|
$
|
21,640
|
|
|
$
|
12,110
|
|
|
|
|
|
||||
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Other liabilities:
|
|
|
|
||||
Deferred tax liabilities
|
$
|
8,916
|
|
|
$
|
22,026
|
|
Prepaid rent received and unearned revenue
|
13,585
|
|
|
10,450
|
|
||
Tenant security deposits
|
4,322
|
|
|
4,953
|
|
||
Prepaid service charge reimbursement
|
1,560
|
|
|
1,988
|
|
||
Other
|
535
|
|
|
3,237
|
|
||
Total
|
$
|
28,918
|
|
|
$
|
42,654
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Deferred tax asset
|
|
|
|
||||
Net operating losses
|
$
|
21,608
|
|
|
$
|
14,161
|
|
Interest deferral
|
4,356
|
|
|
5,896
|
|
||
Transaction costs capitalized to operating real estate
|
6,654
|
|
|
13,099
|
|
||
Operating real estate
|
2,028
|
|
|
—
|
|
||
Other
|
7,410
|
|
|
1,805
|
|
||
Total deferred tax asset
|
42,056
|
|
|
34,961
|
|
||
Valuation allowance
|
(26,565
|
)
|
|
(21,460
|
)
|
||
Deferred tax assets, net of valuation allowance
|
15,491
|
|
|
13,501
|
|
||
Deferred tax liabilities
|
|
|
|
||||
Operating real estate
|
(20,418
|
)
|
|
(30,237
|
)
|
||
Other
|
(3,989
|
)
|
|
(5,070
|
)
|
||
Total deferred tax liabilities
|
(24,407
|
)
|
|
(35,307
|
)
|
||
Net deferred tax liability
|
$
|
(8,916
|
)
|
|
$
|
(21,806
|
)
|
3.
|
Operating Real Estate
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Land
|
|
$
|
360,555
|
|
|
$
|
456,703
|
|
Buildings and improvements
|
|
980,053
|
|
|
1,256,002
|
|
||
Building, leasehold interests and improvements
|
|
212,864
|
|
|
334,970
|
|
||
Furniture, fixtures and equipment
|
|
1,214
|
|
|
218
|
|
||
Tenant improvements
|
|
59,746
|
|
|
72,567
|
|
||
Operating real estate, gross
|
|
1,614,432
|
|
|
2,120,460
|
|
||
Less: accumulated depreciation
|
|
(63,585
|
)
|
|
(35,303
|
)
|
||
Operating real estate, net
|
|
$
|
1,550,847
|
|
|
$
|
2,085,157
|
|
(1)
|
Includes building and tenant improvements.
|
(2)
|
Primarily includes in-place lease, above-market lease and goodwill.
|
(3)
|
Primarily includes debt assumed and other accrued expenses.
|
|
|
|
|
Assets
|
|
Liabilities
|
||||||||||||||||||||||||
Description
(1)
|
|
Properties
|
|
Operating Real Estate, Net
|
|
Intangible Assets, Net
|
|
Other Assets
|
|
Total
(2)
|
|
Intangible Liabilities, Net
|
|
Other Liabilities
|
|
Total
(2)
|
||||||||||||||
Internos Portfolio
(3)
|
|
2
|
|
$
|
17,495
|
|
|
$
|
2,224
|
|
|
$
|
3,359
|
|
|
$
|
23,078
|
|
|
$
|
237
|
|
|
$
|
1,574
|
|
|
$
|
1,811
|
|
IVG Portfolio
|
|
1
|
|
4,832
|
|
|
288
|
|
|
9
|
|
|
5,129
|
|
|
230
|
|
|
—
|
|
|
230
|
|
|||||||
Total
|
|
3
|
|
$
|
22,327
|
|
|
$
|
2,512
|
|
|
$
|
3,368
|
|
|
$
|
28,207
|
|
|
$
|
467
|
|
|
$
|
1,574
|
|
|
$
|
2,041
|
|
(1)
|
The assets and liabilities classified as held for sale are expected to be sold on the open market as asset sales and share sales subject to standard industry terms and conditions. The assets contributed
$3.0 million
and
$2.2 million
of revenue and a loss before income tax benefit (expense) of
$0.8 million
and
$2.7 million
for the years ended
December 31, 2016
and 2015.
|
(2)
|
Represents operating real estate and intangible assets and liabilities, net of depreciation and amortization of
$1.6 million
accumulated prior to being reclassified into held for sale.
|
(3)
|
One
asset was sold in February 2017.
|
4.
|
Borrowings
|
|
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||
|
Final
Maturity |
|
Contractual
Interest Rate (2) |
|
Principal
Amount |
|
Carrying
Value |
|
Principal
Amount |
|
Carrying
Value |
||||||||
Mortgage and other notes payable:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
U.K. Complex - Floating
|
Jan-20
|
|
GBP LIBOR + 1.75%
(3)
|
|
$
|
50,116
|
|
|
$
|
49,284
|
|
|
$
|
60,369
|
|
|
$
|
59,210
|
|
U.K. Complex - Fixed
|
Jan-20
|
|
8.325%
(3)
|
|
11,565
|
|
|
11,497
|
|
|
13,641
|
|
|
13,369
|
|
||||
Internos Portfolio
(7)(10)
|
Dec-20
|
|
(4)
|
|
67,455
|
|
|
66,619
|
|
|
84,497
|
|
|
82,329
|
|
||||
IVG Portfolio
(7)(10)
|
Dec-20
|
|
(4)
|
|
54,977
|
|
|
53,476
|
|
|
78,602
|
|
|
75,732
|
|
||||
Deka Portfolio
(7)
|
Dec-20
|
|
(4)
|
|
27,010
|
|
|
26,928
|
|
|
46,945
|
|
|
46,212
|
|
||||
SEB Portfolio
(7)
|
Apr-22
|
|
(5)
|
|
507,892
|
|
|
500,692
|
|
|
684,540
|
|
|
674,543
|
|
||||
SEB Portfolio - Preferred
|
Apr-60
|
|
(6)
|
|
90,033
|
|
|
89,720
|
|
|
115,604
|
|
|
115,219
|
|
||||
Trianon Tower
|
Jul-23
|
|
(8)
|
|
347,012
|
|
|
345,422
|
|
|
359,898
|
|
|
357,996
|
|
||||
Other - Preferred
|
Oct-45
|
|
(9)
|
|
6,151
|
|
|
5,481
|
|
|
—
|
|
|
—
|
|
||||
Total mortgage and other notes payable
|
|
|
|
|
1,162,211
|
|
|
1,149,119
|
|
|
1,444,096
|
|
|
1,424,610
|
|
||||
Senior Notes:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Senior Notes
|
Dec-16
|
|
4.625%
|
|
—
|
|
|
—
|
|
|
340,000
|
|
|
333,798
|
|
||||
Grand Total
|
|
|
|
|
$
|
1,162,211
|
|
|
$
|
1,149,119
|
|
|
$
|
1,784,096
|
|
|
$
|
1,758,408
|
|
(1)
|
All borrowings are non-recourse and are interest-only through maturity, subject to compliance with covenants of the respective borrowing and denominated in the same currency as the assets securing the borrowing.
|
(2)
|
Refer to Note 9 for further disclosure regarding derivative instruments which are used to manage interest rate exposure.
|
(3)
|
In May 2016, the loan was syndicated and as such the margins on the floating and fixed interest rates were adjusted.
|
(4)
|
Represents cross-collateralized borrowings among the IVG Portfolio, Internos Portfolio and Deka Portfolio. Comprised of
$10.3 million
principal amount of floating rate borrowings at EURIBOR plus
2.7%
,
$79.0 million
principal amount of floating rate borrowings at EURIBOR plus
1.55%
,
$44.4 million
principal amount of floating rate borrowings at EURIBOR plus
1.65%
and
$15.8 million
of floating rate borrowings at GBP LIBOR plus
2.7%
.
|
(5)
|
Comprised of
$278.5 million
principal amount of floating rate borrowing at EURIBOR plus
1.8%
and
$229.4 million
of floating rate borrowing at GBP LIBOR plus
1.8%
.
|
(6)
|
Represents preferred equity certificates with a contractual interest rate of
3.0%
per annum which was reduced in July 2016 to
2.3%
through May 2019, which can be prepaid at that time without penalty in part or in full, which increases to EURIBOR plus
12.0%
through May 2022 and subsequently to EURIBOR plus
15.0%
through final maturity. Certain prepayments prior to May 2019 are subject to the payment of the unpaid coupon on outstanding principal amount through May 2019.
|
(7)
|
Prepayment provisions include a fee based on principal amount ranging from
0.25%
to
1.0%
through December 2019 for the Internos Portfolio, the IVG Portfolio and the Deka Portfolio borrowing and
0.5%
to
1.5%
through April 2019 for the SEB Portfolio borrowing.
|
(8)
|
In June 2016, the Company amended the contractual interest rate from EURIBOR plus
1.45%
to EURIBOR plus
1.30%
. In addition, a prepayment provision was added in the amendment to include a fee based on principal amount of
0.80%
through June 30, 2017,
0.60%
through June 30, 2018 and
0.30%
through June 30, 2019.
|
(9)
|
Includes assets associated preferred equity certificates each with a fixed contractual interest rate of
1.0%
per annum plus variable interest based on specified income levels associated to the German property companies of the IVG Portfolio, Deka Portfolio and Internos Portfolio, respectively, which can be prepaid at any time without penalty through final maturity, being
thirty
years from the issuance date.
|
(10)
|
Includes debt associated with assets held for sale of
$5.2 million
.
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Principal amount
|
|
$
|
1,162,211
|
|
|
$
|
1,784,096
|
|
Premium (discount), net
|
|
—
|
|
|
(1,144
|
)
|
||
Deferred financing costs, net
|
|
(13,092
|
)
|
|
(24,544
|
)
|
||
Carrying value
|
|
$
|
1,149,119
|
|
|
$
|
1,758,408
|
|
•
|
any equity the Company issues in exchange or conversion of exchangeable or stock-settlable notes;
|
•
|
any other issuances by the Company of common equity, preferred equity or other forms of equity, including but not limited to LTIP Units in the Operating Partnership (excluding units issued to the Company and equity-based compensation, but including issuances related to an acquisition, investment, joint venture or partnership); and
|
•
|
cumulative cash available for distribution (“CAD”), if any, of the Company in excess of cumulative distributions paid on common stock, LTIP Units or other equity awards which began with the Company’s fiscal quarter ended March 31, 2016.
|
•
|
the product of: (a)
15.0%
and (b) the Company’s CAD before such incentive fee, divided by the weighted average shares outstanding for the calendar quarter, of any amount in excess of
$0.30
per share and up to
$0.36
per share; plus
|
•
|
the product of: (a)
25.0%
and (b) the Company’s CAD before such incentive fee, divided by the weighted average shares outstanding for the calendar quarter, of any amount in excess of
$0.36
per share;
|
•
|
multiplied by the Company’s weighted average shares outstanding for the calendar quarter.
|
6.
|
Compensation Expense
|
|
Year Ended December 31, 2016
|
|||||||||||||||||
|
Restricted Stock
(1)
|
|
Common Units
|
|
Restricted Stock Units
(2)
|
|
Performance RSUs
(3)
|
|
Total Grants
|
|
Weighted
Average Grant Price |
|||||||
December 31, 2015
|
45
|
|
|
692
|
|
|
83
|
|
|
298
|
|
|
1,118
|
|
|
$
|
19.91
|
|
Granted
|
1,684
|
|
|
—
|
|
|
—
|
|
|
1,688
|
|
|
3,372
|
|
|
7.98
|
|
|
Vested
|
(587
|
)
|
|
—
|
|
|
—
|
|
|
(117
|
)
|
|
(704
|
)
|
|
9.09
|
|
|
Forfeited
|
(3
|
)
|
|
(4
|
)
|
|
—
|
|
|
(1
|
)
|
|
(8
|
)
|
|
15.83
|
|
|
December 31, 2016
|
1,139
|
|
|
688
|
|
|
83
|
|
|
1,868
|
|
|
3,778
|
|
|
$
|
11.29
|
|
(1)
|
Represents restricted stock included in common stock.
|
(2)
|
Represents non-employee grants subject to time-based vesting conditions. In connection with entering into the Healthcare Strategic Partnership, NorthStar Realty granted Mr. Flaherty
0.1 million
RSUs on January 22, 2014, adjusted to reflect NorthStar Realty’s reverse stock split and the NRE Spin-Off, which vest on January 22, 2019, unless certain conditions are met. The RSUs are entitled to dividend equivalents prior to vesting and may be settled either in shares of common stock of the Manager or in cash at the option of the Manager.
|
(3)
|
During 2016,
0.2 million
performance based RSUs were issued to executives as part of the Manager’s 2015 bonus plan. The grant price per share for the performance-based RSUs was
$0.41
, which was determined using a risk free interest rate of
0.88%
and
1.5 million
performance based RSUs were issued to executive and non-executive employees as part of NorthStar Realty and the Manager’s bonus plan. The initial grant date share price ranged from
$5.69
to
$9.24
, which was determined using a risk free interest rate of
1.16%
.
0.1 million
RSUs related to NorthStar Realty’s bonus plan for 2012 were settled by the Company in January 2016.
|
7.
|
Stockholders’ Equity
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
|
||||||||||||
|
Year Ended
December 31, |
|
Year Ended
December 31, |
|
September 16 to December 31,
|
|
January 1 to September 15,
|
|
||||||||
|
2016
(1)
|
|
2015
(1)
|
|
2014
(1)
|
|
2014
(1)
|
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to NorthStar Realty Europe Corp.
|
$
|
(61,753
|
)
|
|
$
|
(143,136
|
)
|
|
$
|
(33,630
|
)
|
|
$
|
(3,007
|
)
|
|
Net income (loss) attributable to Unit Holders non-controlling interest
|
(778
|
)
|
|
(1,052
|
)
|
|
—
|
|
|
—
|
|
|
||||
Net income (loss) attributable to common stockholders and Unit Holders
(1)
|
$
|
(62,531
|
)
|
|
$
|
(144,188
|
)
|
|
$
|
(33,630
|
)
|
|
$
|
(3,007
|
)
|
|
Denominator:
(2)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares of common stock
|
57,875
|
|
|
62,184
|
|
|
62,988
|
|
(3)
|
62,988
|
|
(3)
|
||||
Weighted average Unit Holders
(1)
|
690
|
|
|
681
|
|
|
—
|
|
|
—
|
|
|
||||
Weighted average shares of common stock and Unit Holders
(2)
|
58,565
|
|
|
62,865
|
|
|
62,988
|
|
(3)
|
62,988
|
|
(3)
|
||||
Earnings (loss) per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(1.07
|
)
|
|
$
|
(2.30
|
)
|
|
$
|
(0.53
|
)
|
(3)
|
$
|
(0.05
|
)
|
(3)
|
Diluted
|
$
|
(1.07
|
)
|
|
$
|
(2.30
|
)
|
|
$
|
(0.53
|
)
|
(3)
|
$
|
(0.05
|
)
|
(3)
|
(1)
|
The EPS calculation takes into account Unit Holders, which receive non-forfeitable dividends from the date of grant, share equally in the Company’s net income (loss) and convert on a
one
-for-one basis into common stock.
|
(2)
|
Excludes the effect of restricted stock and RSUs outstanding that were not dilutive as of
December 31, 2016
. These instruments could potentially impact diluted EPS in future periods, depending on changes in the Company’s stock price and other factors.
|
(3)
|
Basic and diluted earnings per common share for the year ended
December 31, 2014 was calculated using the common stock issued in connection with the Spin-off and exclude the effect of any equity-based awards outstanding at that date that were not dilutive.
|
8.
|
Non-controlling Interests
|
9.
|
Risk Management and Derivative Activities
|
|
Number
|
|
Notional
Amount
|
|
Fair Value
Asset |
|
Range of
Fixed GBP LIBOR / EURIBOR |
|
Range of Maturity
|
|||||
As of December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|||||
Interest rate caps
|
4
|
|
|
$
|
1,107,400
|
|
|
$
|
8,659
|
|
|
(1)
|
|
January 2020 - July 2023
|
Foreign currency forwards
(2)
|
2
|
|
|
72,806
|
|
|
5,070
|
|
|
N/A
|
|
February 2017 - November 2017
|
||
Total
|
6
|
|
|
$
|
1,180,206
|
|
|
$
|
13,729
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
As of December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Interest rate caps
|
6
|
|
|
$
|
1,429,216
|
|
|
$
|
23,375
|
|
|
(1)
|
|
April 2016 - July 2023
|
Foreign currency forwards
(2)
|
3
|
|
|
154,353
|
|
|
417
|
|
|
N/A
|
|
February 2016 - November 2017
|
||
Total
|
9
|
|
|
$
|
1,583,569
|
|
|
$
|
23,792
|
|
|
|
|
|
10.
|
Fair Value
|
Level 1.
|
Quoted prices for identical assets or liabilities in an active market.
|
Level 2.
|
Financial assets and liabilities whose values are based on the following:
|
(a)
|
Quoted prices for similar assets or liabilities in active markets.
|
(b)
|
Quoted prices for identical or similar assets or liabilities in non-active markets.
|
(c)
|
Pricing models whose inputs are observable for substantially the full term of the asset or liability.
|
(d)
|
Pricing models whose inputs are derived principally from or corroborated by observable market data for substantially the full term of the asset or liability.
|
Level 3.
|
Prices or valuation techniques based on inputs that are both unobservable and significant to the overall fair value measurement.
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||
|
Principal/Notional
Amount |
|
Carrying
Value
|
|
Fair
Value |
|
Principal/Notional
Amount |
|
Carrying
Value
|
|
Fair
Value |
||||||||||||
Financial assets:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative assets
|
$
|
1,180,206
|
|
|
$
|
13,729
|
|
|
$
|
13,729
|
|
|
$
|
1,583,569
|
|
|
$
|
23,792
|
|
|
$
|
23,792
|
|
Financial liabilities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage and other notes payable
|
$
|
1,162,211
|
|
|
$
|
1,149,119
|
|
|
$
|
1,146,134
|
|
|
$
|
1,444,096
|
|
|
$
|
1,424,610
|
|
|
$
|
1,424,610
|
|
Senior notes
|
—
|
|
|
—
|
|
|
—
|
|
|
340,000
|
|
|
333,798
|
|
|
327,330
|
|
11.
|
Commitments and Contingencies
|
Years ending December 31:
|
|
Total
(1)
|
||
2017
|
|
$
|
619
|
|
2018
|
|
619
|
|
|
2019
|
|
619
|
|
|
2020
|
|
619
|
|
|
2021
|
|
619
|
|
|
Thereafter
|
|
41,756
|
|
|
Total minimum lease payments
|
|
$
|
44,851
|
|
(1)
|
Represent
one
ground lease with an expiry in 2237 and
two
ground leases with an expiry of 2089. None of these are paid directly by the tenants.
|
12.
|
Quarterly Financial Information (Unaudited)
|
|
|
NorthStar Europe Period
|
||||||||||||||
|
|
Three Months Ended
|
||||||||||||||
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
||||||||
|
|
2016
|
|
2016
|
|
2016
|
|
2016
|
||||||||
Rental income
|
|
$
|
25,700
|
|
|
$
|
29,798
|
|
|
$
|
33,990
|
|
|
$
|
34,833
|
|
Escalation income
|
|
5,347
|
|
|
7,828
|
|
|
5,908
|
|
|
6,090
|
|
||||
Total expenses
|
|
46,521
|
|
|
46,722
|
|
|
79,514
|
|
|
53,409
|
|
||||
Income (loss) before income tax benefit (expense)
|
|
14,128
|
|
|
(10,115
|
)
|
|
(33,789
|
)
|
|
(29,984
|
)
|
||||
Net income (loss)
|
|
13,902
|
|
|
(12,770
|
)
|
|
(34,309
|
)
|
|
(29,325
|
)
|
||||
Net income (loss) attributable to NorthStar Realty Europe Corp. common stockholders
|
|
13,859
|
|
|
(12,721
|
)
|
|
(33,909
|
)
|
|
(28,982
|
)
|
||||
Earnings (loss) per share:
(1)
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
0.25
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.57
|
)
|
|
$
|
(0.49
|
)
|
Diluted
|
|
$
|
0.24
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.57
|
)
|
|
$
|
(0.49
|
)
|
(1)
|
The total for the year may differ from the sum of the quarters as a result of weighting.
|
|
|
NorthStar Europe Period
|
|
||||||||||||||
|
|
Three Months Ended
|
|
||||||||||||||
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
||||||||
|
|
2015
|
|
2015
|
|
2015
|
|
2015
|
|
||||||||
Rental income
|
|
$
|
37,098
|
|
|
$
|
34,072
|
|
|
$
|
28,344
|
|
|
$
|
1,509
|
|
|
Escalation income
|
|
6,825
|
|
|
8,106
|
|
|
3,213
|
|
|
678
|
|
|
||||
Total expenses
|
|
67,794
|
|
|
69,350
|
|
|
117,418
|
|
|
3,440
|
|
|
||||
Income (loss) before income tax benefit (expense)
|
|
(19,636
|
)
|
|
(35,772
|
)
|
|
(73,120
|
)
|
|
(16,290
|
)
|
|
||||
Net income (loss)
|
|
(34,180
|
)
|
|
(31,932
|
)
|
|
(76,688
|
)
|
|
(1,343
|
)
|
|
||||
Net income (loss) attributable to NorthStar Realty Europe Corp. common stockholders
|
|
(33,949
|
)
|
|
(31,892
|
)
|
|
(75,983
|
)
|
|
(1,312
|
)
|
|
||||
Earnings (loss) per share:
(2)
|
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.55
|
)
|
|
$
|
(0.51
|
)
|
(1)
|
$
|
(1.21
|
)
|
(1)
|
$
|
(0.02
|
)
|
(1)
|
Diluted
|
|
$
|
(0.55
|
)
|
|
$
|
(0.51
|
)
|
(1)
|
$
|
(1.21
|
)
|
(1)
|
$
|
(0.02
|
)
|
(1)
|
(1)
|
Basic and diluted earnings per common share for the periods prior to November 1, 2015 were calculated using the common stock issued in connection with the Spin-off and exclude the effect of any equity-based awards outstanding at that date that were not dilutive.
|
(2)
|
The total for the year may differ from the sum of the quarters as a result of weighting.
|
13.
|
Segment Reporting
|
•
|
Real Estate -
The European commercial real estate business is predominantly focused on prime office properties located in key cities within Germany, the United Kingdom and France. The Company acquired its first real estate investment in September 2014.
|
•
|
Corporate
- The corporate segment includes corporate level interest expense, management fee and general and administrative expenses.
|
|
NorthStar Europe Period
|
||||||||||
|
Year Ended December 31, 2016
|
||||||||||
Statement of Operations:
|
Real Estate
|
|
Corporate
|
|
Total
|
||||||
Rental income
(1)
|
$
|
124,321
|
|
(1)
|
$
|
—
|
|
|
$
|
124,321
|
|
Escalation income
(1)
|
25,173
|
|
(1)
|
—
|
|
|
25,173
|
|
|||
Interest expense
(3)
|
30,974
|
|
|
10,465
|
|
|
41,439
|
|
|||
Income (loss) before income tax benefit (expense)
|
(4,005
|
)
|
|
(55,755
|
)
|
(4)
|
(59,760
|
)
|
|||
Income tax benefit (expense)
|
(2,742
|
)
|
|
—
|
|
|
(2,742
|
)
|
|||
Net income (loss)
|
(6,747
|
)
|
(2)
|
(55,755
|
)
|
|
(62,502
|
)
|
|||
Balance Sheet:
|
|
|
|
|
|
||||||
December 31, 2016:
|
|
|
|
|
|
||||||
Total Assets
|
$
|
1,835,531
|
|
|
$
|
9,861
|
|
|
$
|
1,845,392
|
|
(1)
|
Includes revenues attributable to Germany, the United Kingdom, France and the Netherlands of
$56.8 million
,
$38.5 million
,
$21.6 million
and
$17.0 million
, respectively.
|
(2)
|
Primarily relates to rental income offset by depreciation and amortization expense of
$65.0 million
and impairment loss of
$27.5 million
.
|
(3)
|
Includes
$3.7 million
and
$3.4 million
of amortization of deferred financing costs in the real estate and corporate segments, respectively.
|
(4)
|
Includes an allocation of general and administrative expenses from the Manager of
$0.2 million
.
|
|
NorthStar Europe Period
|
||||||||||
|
Year Ended December 31, 2015
|
||||||||||
Statement of Operations:
|
Real Estate
|
|
Corporate
|
|
Total
|
||||||
Rental income
|
$
|
101,023
|
|
(1)
|
$
|
—
|
|
|
$
|
101,023
|
|
Escalation income
|
18,822
|
|
(1)
|
—
|
|
|
18,822
|
|
|||
Interest expense
(3)
|
25,365
|
|
|
10,764
|
|
|
36,129
|
|
|||
Income (loss) before income tax benefit (expense)
|
(106,141
|
)
|
|
(38,677
|
)
|
(4)
|
(144,818
|
)
|
|||
Income tax benefit (expense)
|
675
|
|
|
—
|
|
|
675
|
|
|||
Net income (loss)
|
(105,466
|
)
|
(2)
|
(38,677
|
)
|
|
(144,143
|
)
|
|||
Balance Sheet:
|
|
|
|
|
|
||||||
December 31, 2015:
|
|
|
|
|
|
||||||
Total Assets
|
$
|
2,544,992
|
|
|
$
|
138,058
|
|
|
$
|
2,683,050
|
|
(1)
|
Includes revenues attributable to Germany, the United Kingdom, France and the Netherlands of
$34.4 million
,
$37.1 million
,
$16.1 million
and
$15.1 million
, respectively.
|
(2)
|
Primarily relates to depreciation and amortization expense of
$56.3 million
and transaction costs related to the New European Investments of
$99.1 million
.
|
(3)
|
Includes
$2.9 million
and
$3.0 million
of amortization of deferred financing costs in the real estate and corporate segment, respectively.
|
(4)
|
Includes an allocation of general and administrative expenses from the Manager of
$0.4 million
.
|
|
NorthStar Europe Period
|
|
Prior Owner Period
|
||||||||||||||||||||
|
September 16, 2014 to December 31, 2014
|
|
January 1 to September 15, 2014
|
||||||||||||||||||||
Statement of Operations:
|
Real Estate
|
|
Corporate
|
|
Total
|
|
Real Estate
|
|
Corporate
|
|
Total
|
||||||||||||
Rental income
|
$
|
1,740
|
|
(1)
|
$
|
—
|
|
|
$
|
1,740
|
|
|
$
|
4,455
|
|
|
$
|
—
|
|
|
$
|
4,455
|
|
Escalation income
|
982
|
|
(1)
|
—
|
|
|
982
|
|
|
2,707
|
|
|
—
|
|
|
2,707
|
|
||||||
Interest expense
|
165
|
|
|
—
|
|
|
165
|
|
|
3,486
|
|
|
—
|
|
|
3,486
|
|
||||||
Income (loss) before income tax benefit (expense)
|
(32,699
|
)
|
(2)
|
(1,207
|
)
|
(3)
|
(33,906
|
)
|
|
1,434
|
|
|
(4,441
|
)
|
(3)
|
(3,007
|
)
|
||||||
Income tax benefit (expense)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net income (loss)
|
(32,699
|
)
|
|
(1,207
|
)
|
|
(33,906
|
)
|
|
1,434
|
|
|
(4,441
|
)
|
|
(3,007
|
)
|
||||||
Balance Sheet:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total Assets
|
$
|
160,271
|
|
|
$
|
—
|
|
|
$
|
160,271
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Represents revenues from the U.K. Complex in the United Kingdom of $
2.7 million
.
|
(2)
|
Primarily relates to transaction costs related to the U.K. Complex of
$4.3 million
and to the New European Investments of
$27.5 million
.
|
(3)
|
Includes an allocation of general and administrative expense based on an estimate of expenses had the Company been run as an independent entity (refer to Note 2).
|
14.
|
Subsequent Events
|
Column A
|
|
Column B
|
|
Column C Initial Cost
|
|
Column D Capitalized Subsequent to Acquisition
|
|
Column E Gross Amount Carried at Close of Period
|
|
Column F
|
|
Column G
|
|
Column H
|
||||||||||||||||||||||||||
Country, City
|
|
Encumbrances
(1)
|
|
Land
|
|
Building & Improvements
|
|
Land, Buildings & Improvements
|
|
Land
|
|
Building & Improvements
|
|
Total
|
|
Accumulated Depreciation
|
|
Total
(2)
|
|
Date Acquired
|
|
Life on Which Depreciation is Computed
|
||||||||||||||||||
Germany
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Hamburg 2
|
|
$
|
38,395
|
|
|
$
|
30,140
|
|
|
$
|
21,691
|
|
|
$
|
637
|
|
|
$
|
30,140
|
|
|
$
|
22,328
|
|
|
$
|
52,468
|
|
|
$
|
1,456
|
|
|
$
|
51,012
|
|
|
4/1/2015
|
|
40 years
|
Hamburg 1
|
|
30,028
|
|
|
21,603
|
|
|
26,411
|
|
|
1,119
|
|
|
21,603
|
|
|
27,530
|
|
|
49,133
|
|
|
1,621
|
|
|
47,512
|
|
|
4/1/2015
|
|
40 years
|
|||||||||
Frankfurt 1
|
|
345,422
|
|
|
78,489
|
|
|
455,117
|
|
|
808
|
|
|
78,489
|
|
|
455,925
|
|
|
534,414
|
|
|
20,975
|
|
|
513,439
|
|
|
7/15/2015
|
|
40 years
|
|||||||||
Berlin 2
|
|
10,172
|
|
|
759
|
|
|
20,120
|
|
|
16
|
|
|
759
|
|
|
20,136
|
|
|
20,895
|
|
|
873
|
|
|
20,022
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Berlin 3
|
|
7,061
|
|
|
793
|
|
|
10,950
|
|
|
—
|
|
|
793
|
|
|
10,950
|
|
|
11,743
|
|
|
475
|
|
|
11,268
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Köln 1
|
|
16,394
|
|
|
10,916
|
|
|
17,580
|
|
|
274
|
|
|
10,916
|
|
|
17,854
|
|
|
28,770
|
|
|
950
|
|
|
27,820
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Münster
|
|
4,385
|
|
|
2,467
|
|
|
4,994
|
|
|
828
|
|
|
2,467
|
|
|
5,822
|
|
|
8,289
|
|
|
243
|
|
|
8,046
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Berlin 1
|
|
25,728
|
|
|
7,396
|
|
|
33,098
|
|
|
—
|
|
|
7,396
|
|
|
33,098
|
|
|
40,494
|
|
|
1,559
|
|
|
38,935
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Frankfurt 2
|
|
10,535
|
|
|
3,954
|
|
|
13,972
|
|
|
1,095
|
|
|
3,954
|
|
|
15,067
|
|
|
19,021
|
|
|
763
|
|
|
18,258
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Werl
|
|
1,520
|
|
|
873
|
|
|
2,412
|
|
|
—
|
|
|
873
|
|
|
2,412
|
|
|
3,285
|
|
|
143
|
|
|
3,142
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Bremen
|
|
—
|
|
|
305
|
|
|
1,224
|
|
|
—
|
|
|
305
|
|
|
1,224
|
|
|
1,529
|
|
|
195
|
|
|
1,334
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Subtotal
|
|
489,640
|
|
|
157,695
|
|
|
607,569
|
|
|
4,777
|
|
|
157,695
|
|
|
612,346
|
|
|
770,041
|
|
|
29,253
|
|
|
740,788
|
|
|
|
|
|
|||||||||
France
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Paris 1
|
|
83,005
|
|
|
87,959
|
|
|
48,561
|
|
|
15
|
|
|
87,959
|
|
|
48,576
|
|
|
136,535
|
|
|
3,021
|
|
|
133,514
|
|
|
4/1/2015
|
|
40 years
|
|||||||||
Paris 2
|
|
47,280
|
|
|
30,290
|
|
|
39,355
|
|
|
—
|
|
|
30,290
|
|
|
39,355
|
|
|
69,645
|
|
|
2,357
|
|
|
67,288
|
|
|
4/1/2015
|
|
40 years
|
|||||||||
Paris 5
|
|
6,128
|
|
|
9,259
|
|
|
3,821
|
|
|
—
|
|
|
9,259
|
|
|
3,821
|
|
|
13,080
|
|
|
217
|
|
|
12,863
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Paris 3
|
|
23,082
|
|
|
31,168
|
|
|
11,927
|
|
|
1,180
|
|
|
31,168
|
|
|
13,107
|
|
|
44,275
|
|
|
720
|
|
|
43,555
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Marly
|
|
19,521
|
|
|
4,450
|
|
|
38,656
|
|
|
—
|
|
|
4,450
|
|
|
38,656
|
|
|
43,106
|
|
|
1,723
|
|
|
41,383
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Subtotal
|
|
179,016
|
|
|
163,126
|
|
|
142,320
|
|
|
1,195
|
|
|
163,126
|
|
|
143,515
|
|
|
306,641
|
|
|
8,038
|
|
|
298,603
|
|
|
|
|
|
|||||||||
United Kingdom
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Woking
|
|
60,781
|
|
|
—
|
|
|
43,621
|
|
|
2,094
|
|
|
—
|
|
|
45,715
|
|
|
45,715
|
|
|
3,436
|
|
|
42,279
|
|
|
9/16/2014
|
|
40 years
|
|||||||||
London 2
|
|
99,767
|
|
|
15,332
|
|
|
115,740
|
|
|
1,290
|
|
|
15,332
|
|
|
117,030
|
|
|
132,362
|
|
|
6,349
|
|
|
126,013
|
|
|
4/1/2015
|
|
40 years
|
|||||||||
London 1
|
|
126,330
|
|
|
—
|
|
|
172,241
|
|
|
92
|
|
|
—
|
|
|
172,333
|
|
|
172,333
|
|
|
8,152
|
|
|
164,181
|
|
|
4/1/2015
|
|
40 years
|
|||||||||
St. Albans
|
|
3,463
|
|
|
1,904
|
|
|
4,417
|
|
|
—
|
|
|
1,904
|
|
|
4,417
|
|
|
6,321
|
|
|
280
|
|
|
6,041
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Glasgow
|
|
4,512
|
|
|
2,262
|
|
|
6,440
|
|
|
—
|
|
|
2,262
|
|
|
6,440
|
|
|
8,702
|
|
|
325
|
|
|
8,377
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
London 3
|
|
7,472
|
|
|
6,314
|
|
|
6,073
|
|
|
3
|
|
|
6,314
|
|
|
6,076
|
|
|
12,390
|
|
|
326
|
|
|
12,064
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Subtotal
|
|
302,325
|
|
|
25,812
|
|
|
348,532
|
|
|
3,479
|
|
|
25,812
|
|
|
352,011
|
|
|
377,823
|
|
|
18,868
|
|
|
358,955
|
|
|
|
|
|
|||||||||
Netherlands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Rotterdam
|
|
75,885
|
|
|
10,044
|
|
|
130,392
|
|
|
—
|
|
|
10,044
|
|
|
130,392
|
|
|
140,436
|
|
|
6,590
|
|
|
133,846
|
|
|
4/1/2015
|
|
40 years
|
|||||||||
De Meern
|
|
1,853
|
|
|
1,768
|
|
|
486
|
|
|
4
|
|
|
1,768
|
|
|
490
|
|
|
2,258
|
|
|
101
|
|
|
2,157
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Subtotal
|
|
77,738
|
|
|
11,812
|
|
|
130,878
|
|
|
4
|
|
|
11,812
|
|
|
130,882
|
|
|
142,694
|
|
|
6,691
|
|
|
136,003
|
|
|
|
|
|
|||||||||
Portugal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Lisboa
|
|
—
|
|
|
588
|
|
|
10,534
|
|
|
—
|
|
|
588
|
|
|
10,534
|
|
|
11,122
|
|
|
508
|
|
|
10,614
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Spain
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Madrid
|
|
—
|
|
|
1,522
|
|
|
4,575
|
|
|
14
|
|
|
1,522
|
|
|
4,589
|
|
|
6,111
|
|
|
227
|
|
|
5,884
|
|
|
4/8/2015
|
|
40 years
|
|||||||||
Grand Total
|
|
$
|
1,048,719
|
|
|
$
|
360,555
|
|
|
$
|
1,244,408
|
|
|
$
|
9,469
|
|
|
$
|
360,555
|
|
|
$
|
1,253,877
|
|
|
$
|
1,614,432
|
|
|
$
|
63,585
|
|
|
$
|
1,550,847
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Column A
|
|
Column B
|
|
Column C Initial Cost
|
|
Column D Capitalized Subsequent to Acquisition
|
|
Column E Gross Amount Carried at Close of Period
|
|
Column F
|
|
Column G
|
|
Column H
|
||||||||||||||||||||||||||
Country, City
|
|
Encumbrances
(1)
|
|
Land
|
|
Building & Improvements
|
|
Land, Buildings & Improvements
|
|
Land
|
|
Building & Improvements
|
|
Total
|
|
Accumulated Depreciation
|
|
Total
(2)
|
|
Date Acquired
|
|
Life on Which Depreciation is Computed
|
||||||||||||||||||
Held-for-Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Germany
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Bottrop
|
|
$
|
2,914
|
|
|
$
|
1,230
|
|
|
$
|
3,825
|
|
|
$
|
17
|
|
|
$
|
1,230
|
|
|
$
|
3,842
|
|
|
$
|
5,072
|
|
|
$
|
240
|
|
|
$
|
4,832
|
|
|
4/8/2015
|
|
N/A
|
Portugal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Albufeira
|
|
—
|
|
|
4,389
|
|
|
8,432
|
|
|
56
|
|
|
4,389
|
|
|
8,488
|
|
|
12,877
|
|
|
343
|
|
|
12,534
|
|
|
4/8/2015
|
|
N/A
|
|||||||||
Netherlands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Rijswijk
|
|
2,285
|
|
|
738
|
|
|
3,592
|
|
|
859
|
|
|
738
|
|
|
4,451
|
|
|
5,189
|
|
|
228
|
|
|
4,961
|
|
|
4/8/2015
|
|
N/A
|
|||||||||
Grand Total
|
|
$
|
5,199
|
|
|
$
|
6,357
|
|
|
$
|
15,849
|
|
|
$
|
932
|
|
|
$
|
6,357
|
|
|
$
|
16,781
|
|
|
$
|
23,138
|
|
|
$
|
811
|
|
|
$
|
22,327
|
|
|
|
|
|
(1)
|
Excludes the preferred equity certificates of
$95.2 million
.
|
(2)
|
Aggregate cost for federal income tax purposes is
$1.8 billion
as of December 31, 2016.
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Beginning balance
|
|
$
|
2,120,460
|
|
|
$
|
55,413
|
|
|
$
|
—
|
|
Property acquisitions
|
|
—
|
|
|
2,080,038
|
|
|
57,433
|
|
|||
Reclassification
|
|
(733
|
)
|
|
—
|
|
|
—
|
|
|||
Transfers to held for sale
|
|
(23,138
|
)
|
|
(5,330
|
)
|
|
—
|
|
|||
Improvements
|
|
10,792
|
|
|
3,414
|
|
|
493
|
|
|||
Retirements and disposals
|
|
(353,883
|
)
|
|
(14,514
|
)
|
|
—
|
|
|||
Foreign currency translation
|
|
(139,066
|
)
|
|
1,439
|
|
|
(2,513
|
)
|
|||
Ending balance
|
|
$
|
1,614,432
|
|
|
$
|
2,120,460
|
|
|
$
|
55,413
|
|
|
|
2016
|
|
2015
|
|
2014
|
||||||
Beginning balance
|
|
$
|
(35,303
|
)
|
|
$
|
(517
|
)
|
|
$
|
—
|
|
Depreciation expense
|
|
(45,219
|
)
|
|
(35,842
|
)
|
|
(530
|
)
|
|||
Assets held for sale
|
|
811
|
|
|
31
|
|
|
—
|
|
|||
Retirements and disposals
|
|
10,635
|
|
|
213
|
|
|
—
|
|
|||
Foreign currency translation
|
|
5,491
|
|
|
812
|
|
|
13
|
|
|||
Ending balance
|
|
$
|
(63,585
|
)
|
|
$
|
(35,303
|
)
|
|
$
|
(517
|
)
|
Name
|
|
Age
|
|
Position
|
David T. Hamamoto
|
|
57
|
|
Chairman
|
Richard B. Saltzman
|
|
60
|
|
Director
|
Mario Chisholm
|
|
33
|
|
Independent Director
|
Judith A. Hannaway
|
|
64
|
|
Independent Director
|
Oscar Junquera
|
|
63
|
|
Independent Director
|
Wesley D. Minami
|
|
60
|
|
Independent Director
|
Dianne Hurley
|
|
54
|
|
Independent Director
|
Audit
|
|
Compensation
|
|
Nominating and Corporate Governance
|
Wesley D. Minami*^
|
|
Oscar Junquera*
|
|
Judith A. Hannaway*
|
Mario Chisholm
|
|
Judith A. Hannaway
|
|
Wesley D. Minami
|
Oscar Junquera
|
|
Mario Chisholm
|
|
Dianne Hurley
|
Name
|
|
Age
|
|
Position
|
Mahbod Nia
|
|
40
|
|
Chief Executive Officer and President
|
Scott A. Berry
|
|
38
|
|
Chief Financial Officer and Treasurer
|
Trevor K. Ross
|
|
39
|
|
General Counsel and Secretary
|
Name
|
|
Restricted Stock (#)
|
|
Absolute TSR RSUs (#)
|
|
Relative TSR RSUs (#)
|
|||
Mahbod Nia
|
|
172,043
|
|
|
129,033
|
|
|
129,032
|
|
Scott A. Berry
|
|
21,505
|
|
|
16,129
|
|
|
16,129
|
|
Trevor K. Ross
|
|
21,505
|
|
|
16,129
|
|
|
16,129
|
|
Name and Principal Position
|
|
Stock Awards
($)
(2)
|
|
Total Compensation
($)
|
Mahbod Nia
|
|
4,894,629
|
|
4,894,629
|
Chief Executive Officer and President
|
|
|
|
|
Scott A. Berry
|
|
511,820
|
|
511,820
|
Chief Financial Officer and Treasurer
|
|
|
|
|
Trevor K. Ross
|
|
586,827
|
|
586,827
|
General Counsel and Secretary
|
|
|
|
|
(1)
|
During 2015, the only one of our executive officers who was a “named executive officer” for whom compensation related disclosures were required to be provided was our Chief Executive Officer and President, Mahbod Nia. We did not pay Mr. Nia for serving in his position in 2015, and accordingly, no compensation was reportable for that year.
|
(2)
|
Represents the grant date fair value, computed in accordance with FASB ASC Topic 718, of awards that were granted to our named executive officers in 2016. Includes grants of: (i) restricted shares of our common stock that were granted as long-term bonus for 2015, scheduled to vest in substantially equal installments on December 31, 2016, 2017 and 2018, subject to the named executive officer’s continued employment through the applicable vesting date; (ii) restricted shares of our common stock that were granted in connection with the Spin-off, scheduled to vest in substantially equal installments on December 31, 2016, 2017, 2018 and 2019, subject to the named executive officer’s continued employment through the applicable vesting date; and (iii) Absolute TSR RSUs and Relative TSR RSUs that were granted in connection with the Spin-off, which remain subject to the achievement of cumulative performance goals for the four-year period ending December 31, 2019 and are subject to the named executive officer’s continued employment through such date. If we assumed that all of the performance goals and time vesting for the Absolute TSR RSUs and Relative TSR RSUs would be achieved at the grant date, the value of the awards would have been as follows: Mahbod Nia - $3,321,295; Scott A. Berry - $415,158; and Trevor K. Ross - $415,158. The fair value of these RSUs was determined by a Monte Carlo analysis under a risk-neutral premise using a risk-free interest rate of 1.16%.
|
|
|
Stock Awards
|
||||||
Name
|
|
Number of Shares or Units of Stock That Have Not Vested
(#)
(1)
|
|
Market Value of Shares or Units of Stock That Have Not Vested
($)
(2)
|
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)
(3)
|
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)
(2)
|
Mahbod Nia
|
|
201,992
|
|
2,539,039
|
|
64,516
|
|
810,966
|
Scott A. Berry
|
|
17,940
|
|
225,506
|
|
8,064
|
|
101,364
|
Trevor K. Ross
|
|
24,113
|
|
303,100
|
|
8,064
|
|
101,364
|
(1)
|
For each of our named executive officers, includes the following:
|
Name
|
|
Long-Term
Bonus 2015(a) |
|
Spin-off Restricted Stock(b)
|
|
Pre-Spin-off NorthStar Realty Equity Awards(c)
|
|||
Mahbod Nia
|
|
72,464
|
|
|
129,033
|
|
|
495
|
|
Scott A. Berry
|
|
1,811
|
|
|
16,129
|
|
|
—
|
|
Trevor K. Ross
|
|
7,246
|
|
|
16,129
|
|
|
738
|
|
(a)
|
Represents the unvested portion of restricted shares of our common stock that were granted as long-term bonus for 2015, which were scheduled to vest in substantially equal annual installments on each of December 31, 2017 and 2018, subject to the named executive officer’s continued employment through the applicable vesting date.
|
(b)
|
Represents the unvested portion of restricted shares of our common stock that were granted in connection with the Spin-Off, which were scheduled to vest in three substantially equal annual installments on each of December 31, 2017, 2018 and 2019, subject to the named executive officer’s continued employment through the applicable vesting date.
|
(c)
|
Represents shares of our common stock or common units in our Operating Partnership that were distributed with respect to equity awards granted by NorthStar Realty prior to the Spin-off that had not vested as of December 31, 2016. For Mr. Nia, includes 495 restricted shares of our common stock, which were scheduled to vest in five substantially equal quarterly installments on the 29th day of each January, April, July and October from January 29, 2017 to January 29, 2018. For Mr. Ross, includes 738 common units that were distributed with respect to unvested NorthStar Realty LTIP Units, which were scheduled to vest in seven substantially equal quarterly installments on the 29th day of each January, April, July and October from January 29, 2017 until July 29, 2018. Subject to minimum holding periods, each common unit was redeemable for cash equal to the then fair market value of one share of common stock or, at our option, one share of our common stock.
|
(2)
|
The value of the awards reflected in the table is based on a price per share or unit of $12.57 per share, which was the closing price on the NYSE of one share of our common stock as of December 30, 2016.
|
(3)
|
Represents Absolute TSR RSUs and Relative TSR RSUs that were granted in connection with the Spin-off that will only be earned based upon the achievement of cumulative performance goals for the four-year period ending December 31, 2019. Assuming our performance for the four-year performance period applicable to these awards continues at the same annualized rate as we experienced from the beginning of each performance period through December 31, 2016, each named executive officer would not earn the Absolute TSR RSUs or Relative TSR RSUs. As a result, in accordance with SEC rules, the table reflects 25% of each of the Absolute TSR RSUs and Relative TSR RSUs, which represents the number of RSUs that would be earned if the respective “threshold” performance goal was achieved for each of the Absolute TSR RSUs and the Relative TSR RSUs. See “Spin-off Grants-Absolute TSR RSUs and -Relative TSR RSUs” above for additional information relating to these equity awards.
|
•
|
the named executive officer’s restricted shares of our common stock and/or common units in our Operating Partnership will vest if and to the extent provided for in such officer’s employment agreement with Colony NorthStar or one of its subsidiaries; and
|
•
|
the named executive officer will retain a pro rata percentage of the Absolute TSR RSUs and Relative TSR RSUs and vesting of the remaining amount will remain subject to the same performance-based criteria and will be determined at the end of the performance period; provided that the named executive officer executes a general release of claims in our favor and related persons and entities.
|
Name
|
|
Fees Earned or Paid in
Cash
(1)
|
|
Stock
Awards
(2)
|
|
Total
|
||||||
Mario Chisholm
|
|
$
|
98,500
|
|
|
$
|
75,000
|
|
|
$
|
173,500
|
|
Judith A. Hannaway
|
|
131,000
|
|
|
75,000
|
|
|
206,000
|
|
|||
Oscar Junquera
|
|
98,500
|
|
|
75,000
|
|
|
173,500
|
|
|||
Wesley D. Minami
|
|
91,000
|
|
|
75,000
|
|
|
166,000
|
|
|||
Charles W. Schoenherr
(3)
|
|
116,000
|
|
|
75,000
|
|
|
191,000
|
|
|||
Dianne Hurley
|
|
32,292
|
|
|
215,000
|
|
|
247,292
|
|
(1)
|
Represents the aggregate grant date fair value, computed in accordance with FASB ASC Topic 718, of awards that were granted to our directors in 2016. The grant date fair value of awards granted to our non-management directors was determined based on the closing price of our common stock on the grant date. With respect to the grant date fair value of awards made to Messrs. Hamamoto and Tylis, see the description provided below in note 3. As of December 31, 2016, Ms. Hannaway and Messrs. Junquera, Minami and Schoenherr each held 11,686 unvested common units in our Operating Partnership that had been granted by us as director compensation. As of December 31, 2016, Mr. Chisholm held 11,686 unvested shares of our common stock that had been granted by us as director compensation. As of December 31, 2016, Ms. Hurley held 15,368 unvested shares of common stock that had been granted by us as director compensation.
|
(2)
|
In connection with the Mergers, all of the unvested NRE equity awards that were granted to our non-management directors prior to the signing of the merger agreement and that were scheduled to vest based solely on continued service on our board of directors were, in accordance with their terms, 100% vested upon the closing of the Mergers. As a result, unvested shares of our common stock or common units in our Operating Partnership held by our directors became fully vested upon the closing of the Mergers.
|
(3)
|
Mr. Schoenherr resigned from our Board and all committees thereof, effective as of January 10, 2017.
|
Name
|
|
Fees Earned or Paid in
Cash
|
|
Stock
Awards
(1)2)
|
|
Total
|
||||||
David T. Hamamoto
|
|
$
|
—
|
|
|
$
|
5,969,108
|
|
|
$
|
5,969,108
|
|
Albert Tylis
(3)
|
|
—
|
|
|
4,596,056
|
|
|
4,596,056
|
|
(1)
|
Represents the grant date fair value, computed in accordance with FASB ASC Topic 718, of awards that were granted in 2016. During 2016, Messrs. Hamamoto and Tylis were employees of Colony NorthStar or one of its subsidiaries and provided services to us pursuant to the management agreement. The awards granted to Messrs. Hamamoto and Tylis related to these services and included grants made in connection with the Spin-off, which had the same terms as the awards granted to our named executive officers described under “Executive Compensation-Spin-off Grants,” and grants made in order to fulfill our obligations under the management agreement in connection with long-term bonuses that the NSAM compensation committee determined should be paid in equity. These grants were comprised of the following:
|
|
|
Spin-off Grants
|
|
2015 Bonus
|
|||||||||||
Name
|
|
Restricted Stock
(a)
|
|
Absolute TSR RSUs
(b)
|
|
Relative TSR RSUs
(c)
|
|
Restricted Stock
(d)
|
|
Performance-Based RSUs
(e)
|
|||||
David T. Hamamoto
|
|
210,753
|
|
|
158,065
|
|
|
158,064
|
|
|
126,958
|
|
|
73,608
|
|
Albert Tylis
|
|
167,742
|
|
|
125,807
|
|
|
125,806
|
|
|
84,639
|
|
|
49,072
|
|
(a)
|
Represents restricted shares of our common stock granted in connection with the Spin-off, with terms as set forth above under “Executive Compensation-Spin-off Grants-Restricted Common Stock.” The grant date fair value of the restricted shares of our common stock was determined based on the closing price of our common stock on the grant date.
|
(b)
|
Represents RSUs granted in connection with the Spin-off that are subject to performance-based vesting based on our absolute TSR, with terms as set forth above under “Executive Compensation-Spin-off Grants-Absolute TSR RSUs.” The grant date fair value of these RSUs was determined by a Monte Carlo analysis under a risk-neutral premise using a risk-free interest rate of 1.16% and equals $899,390 and $715,842, respectively, for the RSUs granted to Messrs. Hamamoto and Tylis. If we assumed that all of the performance goals and time vesting for these RSUs would be achieved at the grant date, the value of such awards would have been $1,808,264 and $1,439,232, respectively.
|
(c)
|
Represents RSUs granted in connection with the Spin-off that are subject to performance-based vesting based on our TSR relative to the MSCI US REIT Index, with terms as set forth above under “Executive Compensation-Spin-off Grants-Relative TSR RSUs.” The grant date fair value of these RSUs was determined by a Monte Carlo analysis under a risk-neutral premise using a risk-free interest rate of 1.16% and equals $1,460,511 and $1,162,447, respectively, for the RSUs granted to Messrs. Hamamoto and Tylis. If we assumed that all of the performance goals and time vesting for these RSUs would be achieved at the grant date, the value of such awards would have been $2,260,315 and $1,799,026, respectively.
|
(d)
|
Represents restricted shares of our common stock that were allocated by NSAM’s compensation committee as long-term bonus for 2015 that we were obligated to grant pursuant to the terms of the management agreement, which were scheduled to vest in substantially equal installments on the grant date and December 31, 2016, 2017 and 2018, subject to continued employment through the applicable vesting date. The grant date fair value of the restricted shares of our common stock was determined based on the closing price of our common stock on the grant date. In accordance with the terms of the restricted stock award agreements, vesting of these awards accelerated in full upon the closing of the Mergers because the transaction resulted in a change of control of NSAM.
|
(e)
|
Represents RSUs that were allocated by NSAM’s compensation committee as long-term bonus for 2015 that we were obligated to grant pursuant to the terms of the management agreement. These RSUs were subject to vesting based on the TSR of NorthStar Realty and us from January 1, 2015 through December 31, 2018. None of these RSUs would vest if this TSR was less than 6% on a compounded annual basis, 25% would vest if this TSR equaled 6% on a compounded annual basis, 100% would vest if this TSR was 12% or greater on a compounded annual basis and between 25% and 100% would vest if this TSR was between 6% and 12% on a compounded annual basis. Vesting of these RSUs was also conditioned upon our achievement of positive cash available for distribution during this period and continued employment with NSAM or one of its subsidiaries through the end of the period. Current distributions or distribution equivalents were not payable before performance-based vesting occurred; provided that, upon earning the RSUs, each award recipient was entitled to receive an amount equal to the distributions that would have been paid for each share of our common stock actually earned if such shares had been outstanding since the beginning of the performance period. The grant date fair value of these RSUs was determined by a Monte Carlo analysis under a risk-neutral premise using a risk-free interest rate of 0.88% and equals $30,179 and $20,120, respectively, for the RSUs granted to Messrs. Hamamoto and Tylis. If we assumed that all of the performance goals and time vesting for these RSUs would be achieved at the grant date, the value of such awards would have been $677,194 and $451,462, respectively.
|
(2)
|
As of December 31, 2016, Mr. Hamamoto held the following unvested equity awards: (i) 221,545 restricted shares of our common stock; (ii) 24,761 unvested common units in our Operating Partnership; and (iii) 427,149 RSUs subject to performance-based vesting criteria. As of December 31, 2016, Mr. Tylis held the following unvested equity awards: (i) 168,127 restricted shares of our common stock; (ii) 16,508 unvested common units in our Operating Partnership; and (iii) 325,626 RSUs subject to performance-based vesting criteria. The maximum number of shares of our common stock that were issuable pursuant to these RSUs is equal to the number of RSUs outstanding, except, as described above under “Executive Compensation-Spin-off Grants-Relative TSR RSUs,” up to 125% of the outstanding Relative TSR RSUs could be earned. Pursuant to the terms of the various award agreements, in connection with the closing of the Mergers, all of these unvested restricted shares of our common stock and common units in our Operating Partnership vested and all of these RSUs (other than the Absolute TSR RSUs and Relative TSR RSUs, which were granted in connection with the Spin-off) either vested or were forfeited.
|
(3)
|
Mr. Tylis resigned from our Board and all committees thereof, effective as of February 13, 2017.
|
•
|
each director;
|
•
|
each of our named executive officers; and
|
•
|
all of our directors and named executive officers as a group.
|
|
|
Amount and Nature of
Beneficial Ownership
|
|||
Name and Address of Beneficial Owner
(1)(2)
|
|
Number
|
|
Percentage
|
|
Principal Stockholders
|
|
|
|
|
|
The Vanguard Group
|
|
5,692,393
|
|
(3)
|
10.37%
|
Vanguard Specialized Funds
|
|
4,594,246
|
|
(4)
|
8.37%
|
BlackRock, Inc.
|
|
4,144,362
|
|
|
7.55%
|
Samlyn Capital, LLC
|
|
|
|
|
|
Samlyn, LP
|
|
|
|
|
|
Robert Pohly
|
|
3,747,555
|
|
(6)
|
6.83%
|
Bow Street LLC
|
|
|
|
|
|
A. Akiva Katz
|
|
|
|
|
|
Howard Shainker
|
|
3,723,934
|
|
(7)
|
6.78%
|
Senvest Management, LLC
|
|
|
|
|
|
Richard Mashaal
|
|
3,035,304
|
|
(8)
|
5.53%
|
Directors, Director Nominees and Executive Officers:
|
|
|
|
|
|
David Hamamoto
|
|
721,559
|
|
(9)
|
*
|
Richard B. Saltzman
|
|
—
|
|
(10)
|
|
Mario Chisholm
|
|
26,731
|
|
|
*
|
Judith A. Hannaway
|
|
27,708
|
|
(11)
|
*
|
Dianne Hurley
|
|
22,621
|
|
|
*
|
Oscar Junquera
|
|
29,721
|
|
(12)
|
*
|
Wesley D. Minami
|
|
34,923
|
|
(13)
|
*
|
Mahbod Nia
|
|
192,043
|
|
(14)
|
*
|
Scott A. Berry
|
|
15,377
|
|
(15)
|
*
|
Trevor K. Ross
|
|
29,757
|
|
(16)
|
*
|
All directors and executive officers as a group
|
|
1,100,440
|
|
|
*
|
(1)
|
Each listed person’s beneficial ownership includes: all shares of our common stock and vested common units in our Operating Partnership over which the person has or shares direct or indirect voting or dispositive control and all other shares of our common stock over which the person has the right to acquire direct or indirect voting or dispositive control within 60 days. Unless otherwise described in a footnote below, each person has sole voting and dispositive control over the securities beneficially owned.
|
(2)
|
The address of each of the directors and executive officers is 399 Park Avenue, 18th Floor, New York, NY 10022.
|
(3)
|
Based on information included in the Schedule 13G/A filed by The Vanguard Group on February 10, 2017 (the “Vanguard 13G”). According to the Vanguard 13G, The Vanguard Group beneficially owns 5,692,393 shares of our common stock, with sole voting power over 67,578 shares, shared voting power over 7,214, sole dispositive power over 5,621,262 shares and shared dispositive power over 71,131 shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, PA 19355.
|
(4)
|
Based on information included in the Schedule 13G filed by Vanguard Specialized Funds - Vanguard REIT Index Fund (“Vanguard Specialized Funds”) on February 13, 2017 (the “Vanguard Specialized Funds 13G”). According to the Vanguard Specialized Funds 13G, Vanguard Specialized Funds beneficially
|
(5)
|
Based on information included in the Schedule 13G filed by BlackRock, Inc. on January 30, 2017 (the “BlackRock 13G”). According to the BlackRock 13G, BlackRock, Inc. beneficially owns 4,144,362 shares of our common stock, with sole voting power over 4,023,316 shares and sole dispositive power over 4,144,362 shares. The address of BlackRock, Inc. is 55 East 52
nd
Street, New York, NY 10055.
|
(6)
|
Based on information included in the Schedule 13G filed by Samlyn Capital, LLC, Samlyn, LP and Robert Pohly (collectively, “Samlyn”) on February 14, 2017 (the “Samlyn 13G”). According to the Samlyn 13G, each of Samlyn Capital, LLC, Samlyn, LP and Robert Pohly beneficially owns 3,747,555 shares of our common stock and have shared voting power and shared dispositive power over such shares. The address of Samlyn is 500 Park Avenue, 2
nd
Floor, New York, NY 10022.
|
(7)
|
Based on information included in the Schedule 13D filed by Bow Street LLC, A. Akiva Katz and Howard Shainker (collectively, “Bow Street”) on December 9, 2016 (the “Bow Street 13D”). According to the Bow Street 13D, each of Bow Street LLC, A. Akiva Katz and Howard Shainker beneficially owns 3,723,934 shares of our common stock and have shared voting power and shared dispositive power over such shares. The address of Bow Street LLC is 1140 Avenue of the Americas, 10
th
Floor, New York, NY 10036.
|
(8)
|
Based on information included in the Schedule 13G/A filed by Senvest Management, LLC and Richard Mashaal (collectively, “Senvest”) on February 13, 2017 (the “Senvest 13G”). According to the Senvest 13G, each of Senvest Management, LLC and Richard Mashaal beneficially owns 3,035,304 shares of our common stock and have shared voting power and shared dispositive power over such shares. The address of Senvest is 540 Madison Avenue, 32
nd
Floor, New York, NY 10022.
|
(9)
|
Includes: (i) 1,087 shares of our common stock held by DTH Investment Holdings LLC, of which Mr. Hamamoto is the managing member; (ii) 184,338 shares of our common stock held by The David T. Hamamoto GRAT I-2015, a grantor trust for the benefit of Mr. Hamamoto’s children and of which Mr. Hamamoto is the trustee; (iii) 165,179 shares of our common stock held by The David T. Hamamoto GRAT 2016-NRE, a grantor trust for the benefit of Mr. Hamamoto’s children and of which Mr. Hamamoto is the trustee and (iv) 172,235 common units in our Operating Partnership, or Common Units. Excludes 316,129 shares of our common stock subject to RSUs previously issued by us, which will only be issued if and to the extent future performance conditions are met.
|
(10)
|
Mr. Saltzman joined our Board effective as of February 14, 2017.
|
(11)
|
Includes: (i) 2,383 Common Units and (ii) 17,528 LTIP Units in our Operating Partnership, or LTIP Units.
|
(12)
|
Includes 17,528 LTIP Units.
|
(13)
|
Includes: (i) 2,383 Common Units and (ii) 17,528 LTIP Units.
|
(14)
|
Excludes 258,065 shares of our common stock subject to RSUs previously issued by us, which will only be issued if and to the extent future performance conditions are met.
|
(15)
|
Excludes 32,258 shares of our common stock subject to RSUs previously issued by us, which will only be issued if and to the extent future performance conditions are met.
|
(16)
|
Includes 1,773 Common Units, all of which vested in connection with the Mergers. Excludes 32,258 shares of our common stock subject to RSUs previously issued by us, which will only be issued if and to the extent future performance conditions are met.
|
Plan Category
|
|
Number of
Securities to be
Issued Upon
Exercise of
Outstanding
Options, Warrants,
and Rights
(1)
|
|
Weighted-
Average Exercise
Price of
Outstanding
Options,
Warrants, and
Rights
(1)
|
|
Number of Securities
Remaining Available
for Future Issuance Under Equity Incentive Plans
(2)
|
|||
Equity Compensation Plan Approved by Stockholders
|
|
2,825,839
|
|
|
—
|
|
|
6,616,884
|
|
Equity Compensation Plans Not Approved by Stockholders
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
Total
|
|
2,825,839
|
|
|
—
|
|
|
6,616,884
|
|
(1)
|
As of December 31, 2016, represents shares of our common stock issuable (i) in exchange for 617,945 Common Units that were distributed in connection with the Spin-off with respect to units in the operating partnership of NorthStar Realty that were originally granted as equity compensation awards, (ii) upon settlement of 264,205 outstanding restricted stock units that were granted as equity compensation by NorthStar Realty prior to the Spin-off and were adjusted in connection with the Spin-off of our company from NorthStar Realty to also relate shares of our common stock, (iii) in exchange for common units in our Operating Partnership into which 70,112 LTIP units may be converted conditioned on minimum allocations to the capital accounts of the LTIP units for federal income tax purposes and (iv) in exchange for 1,873,577 RSUs granted subsequent to the Spin-off, which remain to performance-based vesting hurdles and represent the number of shares of our common stock issuable at maximum performance. Each of the common units in our Operating Partnership is redeemable at the election of the holder; provided that upon receipt of a redemption request we may elect to exchange the tendered units for either (i) cash equal to the then fair value of one share of our common stock or (ii) one share of our common stock, at our option in our capacity as general partner of our Operating Partnership.
|
(2)
|
Represents shares of our common stock available for issuance pursuant to the 2015 Plan.
|
•
|
any equity we issue in exchange or conversion of exchangeable or stock-settlable notes;
|
•
|
any other issuances by us of common equity, preferred equity or other forms of equity, including but not limited to limited partnership interests in the Operating Partnership, which are structured as profits interests, or LTIP units (excluding units issued to us and equity-based compensation, but including issuances related to an acquisition, investment, joint venture or partnership); and
|
•
|
cumulative CAD, if any, in excess of cumulative distributions paid on common stock, LTIP Units or other equity awards which began with our fiscal quarter ended March 31, 2016.
|
•
|
the product of: (a) 15% and (b) our CAD before such incentive fee, divided by the weighted average shares outstanding for the calendar quarter, of any amount in excess of $0.30 per share and up to $0.36 per share; plus
|
•
|
the product of: (a) 25% and (b) our CAD before such incentive fee, divided by the weighted average shares outstanding for the calendar quarter, of any amount in excess of $0.36 per share;
|
•
|
multiplied by our weighted average shares outstanding for the calendar quarter.
|
|
|
Years Ended December 31,
|
|
||||||
Type of Fee
|
|
2016
|
|
2015
|
|
||||
Audit fees
(1)
|
|
$
|
3,716
|
|
|
$
|
1,184
|
|
|
Audit-related fees
|
|
—
|
|
|
367
|
|
(2)
|
||
Tax fees
|
|
—
|
|
|
—
|
|
|
||
All other fees
|
|
—
|
|
|
—
|
|
|
||
Total
|
|
$
|
3,716
|
|
|
$
|
1,551
|
|
|
(1)
|
Audit fees consisted principally of fees for the audit of our financial statements and registration statement-related services performed pursuant to SEC filing requirements and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements.
|
(2)
|
Audit-related fees consisted of fees billed for 3-14 audit engagements for financial statements of each operating real estate property (or group of related properties) acquired that is significant at the 10% level or higher.
|
Exhibit
Number
|
|
Description of Exhibit
|
|
2.1
|
|
|
Separation Agreement between NorthStar Realty Europe Corp. and NorthStar Realty Finance Corp. (incorporated by reference to Exhibit 10.2 to NorthStar Realty Europe’s Current Report on Form 8-K filed on November 2, 2015)
|
3.1
|
|
|
Articles of Amendment and Restatement of NorthStar Realty Europe Corp. (incorporated by reference to Exhibit 3.1 to NorthStar Realty Europe’s Current Report on Form 8-K filed on October 23, 2015)
|
3.2
|
|
|
Bylaws of NorthStar Realty Europe Corp. (incorporated by reference to Exhibit 3.2 to NorthStar Realty’s Europe’s Registration Statement on Form S-11 filed on October 9, 2015)
|
10.1
|
|
|
Amended and Restated Agreement of Limited Partnership of NorthStar Realty Europe Limited Partnership dated October 31, 2015 (incorporated by reference to Exhibit 10.4 to NorthStar Realty Europe’s Current Report on Form 8-K filed on November 2, 2015)
|
10.2
|
|
|
Asset Management Agreement between NorthStar Realty Europe Corp. and an affiliate of NorthStar Asset Management Group Inc. (incorporated by reference to Exhibit 10.1 to NorthStar Realty Europe’s Current Report on Form 8-K filed on November 2, 2015)
|
10.3
|
|
|
Contribution Agreement between NorthStar Realty Europe Corp. and NorthStar Realty Finance Corp. (incorporated by reference to Exhibit 10.3 to NorthStar Realty’s Europe’s Current Report on Form 8-K filed on November 2, 2015)
|
10.4
|
|
|
Agreement, dated as of September 16, 2014, by and between Dukes Court-T (UK), LLC, as buyer, and IMW Immobilien SE, as seller (incorporated by reference to Exhibit 10.5 to NorthStar Realty Europe’s Registration Statement on Form S-11 filed on September 29, 2015)
|
10.5
|
|
|
Umbrella Agreement, dated December 22, 2014, by and among Prime Holdco C-T, S.à r.l., Prime GER Drehbahn - T S.à r.l., Prime GER Valentinskamp - T S.à r.l. and Trias Pool II A - T S.à r.l., collectively as the buyers, and SEB Investment GmbH (“SEB”), SEB Investment GmbH, Filiale di Milano, SEB Investment GmbH, French Branch SEB Investment GmbH, Altair Issy S.A.S. and Balni bvba (SPRL), collectively as the sellers (incorporated by reference to Exhibit 10.6 to NorthStar Realty Europe’s Registration Statement on Form S-11 filed on September 29, 2015)
|
10.6
|
|
|
Umbrella Sale and Purchase Agreement, dated as of February 16, 2015, between SEB Investment GmbH, SEB Investment GmbH, Filiale di Milano, SEB Investment GmbH, French Branch SEB Investment GmbH, Altair Issy S.A.S. and Balni bvba (SPRL), collectively as the sellers, and certain subsidiaries of the Company listed therein, as the buyers (incorporated by reference to Exhibit 10.7 to NorthStar Realty Europe’s Registration Statement on Form S-11 filed on September 29, 2015)
|
10.7
|
|
|
Master Agreement, dated as of December 19, 2014, by and among IVG Institutional Funds GmbH, PMG - Property Management GmbH, Via Bensi S.r.l., Internos Spezialfondsgesellschaft mbH and WestInvest Gesellschaft für Investmentfonds mbH, collectively as the sellers, and the several purchasers identified therein, as amended on February 12, 2015, March 27, 2015, April 17, 2015 and June 1, 2015 (incorporated by reference to Exhibit 10.8 to NorthStar Realty Europe’s Registration Statement on Form S-11 filed on October 9, 2015)
|
10.8
|
|
|
Share Sale and Purchase Agreement, dated June 11 and 12, 2015, by and among Madison Trianon S.à r.l. and MSEOF Trianon S.à r.l., collectively as the sellers, and the several purchasers identified therein (incorporated by reference to Exhibit 10.9 to NorthStar Realty Europe’s Registration Statement on Form S-11 filed on September 29, 2015)
|
10.9
|
|
|
Amendment and Restatement Agreement, dated as of July 1, 2015, by and among Prime Holdco C-T, S.à r.l., the borrowers and guarantors identified therein, AAREAL Bank AG, as the agent, arranger and original lender, and the other parties identified therein (incorporated by reference to Exhibit 10.10 to NorthStar Realty Europe’s Registration Statement on Form S-11 filed on October 9, 2015)
|
10.10
|
|
|
Amendment and Restatement Agreement, dated as of July 20, 2015, to the Loan Agreement of September 25, 2014, between Geschäftshaus am Gendarmenmarkt GmbH, as borrower, and Landesbank Hessen-Thüringen Girozentrale, as lender (incorporated by reference to Exhibit 10.12 to NorthStar Realty Europe’s Registration Statement on Form S-11 filed on October 9, 2015)
|
10.11
|
|
+
|
Form of NorthStar Realty Europe Corp. 2015 Omnibus Stock Incentive Plan (incorporated by reference to Exhibit 10.13 to NorthStar Realty’s Europe’s Registration Statement on Form S-11 filed on October 9, 2015)
|
10.12
|
|
+
|
Form of Indemnification Agreement between NorthStar Realty Europe Corp. and each of its directors and executive officers (incorporated by reference to Exhibit 10.14 to NorthStar Realty’s Europe’s Registration Statement on Form S-11 filed on October 9, 2015)
|
10.13
|
|
|
Credit Agreement, dated May 10, 2016, by and among NorthStar Realty Europe Limited Partnership, NorthStar Realty Europe Corp., Bank of America, N.A. as Administrative Agent, Swing Line Lender and L/C Issuer and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Sole Lead Arranger and Sole Bookrunner (incorporated by reference to Exhibit 10.1 to NorthStar Realty’s Europe’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016)
|
Exhibit
Number
|
|
Description of Exhibit
|
|
10.14
|
|
|
Second Amendment Agreement, dated June 21, 2016, by and among Geschäftshaus am Gendarmenmarkt GmbH and GMS Gebäudemanagement und Service GmbH as the Security Providers and Landesbank Hessen-Thüringen Girozentrale (incorporated by reference to Exhibit 10.2 to NorthStar Realty’s Europe’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016)
|
10.15
|
|
|
Letter Amendment dated October 12, 2016 to amended the Credit Agreement, dated May 10, 2016, by and among NorthStar Realty Europe Limited Partnership, NorthStar Realty Europe Corp., Bank of America, N.A. as Administrative Agent, Swing Line Lender and L/C Issuer and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Sole Lead Arranger and Sole Bookrunner (incorporated by reference to Exhibit 10.3 to NorthStar Realty’s Europe’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016)
|
12.1
|
|
*
|
Ratio of Earnings to Combined Fixed Charges
|
21.1
|
|
*
|
Significant Subsidiaries of the Registrant
|
23.1
|
|
*
|
Consent of PricewaterhouseCoopers, Société coopérative
|
23.2
|
|
*
|
Consent of Marcum LLP
|
24.1
|
|
*
|
Power of Attorney (see the Power of Attorney in the signature page hereto)
|
31.1
|
|
*
|
Certification by the Chief Executive Officer pursuant to 17 CFR 240.13a-14(a)/15(d)-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
31.2
|
|
*
|
Certification by the Chief Financial Officer pursuant to 17 CFR 240.13a-14(a)/15(d)-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
32.1
|
|
*
|
Certification by the Chief Executive Officer pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2
|
|
*
|
Certification by the Chief Financial Officer pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.0
|
|
*
|
The following materials from the NorthStar Realty Europe Corp. Annual Report on Form 10-K for the year ended December 31, 2016, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of December 31, 2016 and December 31, 2015; (ii) Consolidated Statements of Operations for the years ended December 31, 2016, 2015 and 2014; (iii) Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2016, 2015 and 2014; (iv) Consolidated Statements of Equity for the years ended December 31, 2016, 2015 and 2014; (v) Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014; and (vi) Notes to Consolidated Financial Statements
|
|
|
|
NorthStar Realty Europe Corp.
|
||||
Date:
|
March 15, 2017
|
|
By:
|
|
/s/ MAHBOD NIA
|
||
|
|
|
|
|
Name:
|
|
Mahbod Nia
|
|
|
|
|
|
Title:
|
|
Chief Executive Officer and President
|
|
|
|
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
/s/ DAVID T. HAMAMOTO
|
|
Chairman
|
|
March 15, 2017
|
David T. Hamamoto
|
|
|
|
|
|
|
|
|
|
/s/ MAHBOD NIA
|
|
Chief Executive Officer and President
|
|
March 15, 2017
|
Mahbod Nia
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ SCOTT A. BERRY
|
|
Chief Financial Officer and Treasurer
|
|
March 15, 2017
|
Scott A. Berry
|
|
(Principal Financial Officer and Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/ RICHARD B. SALTZMAN
|
|
Director
|
|
March 15, 2017
|
Richard B. Saltzman
|
|
|
|
|
|
|
|
|
|
/s/ JUDITH A. HANNAWAY
|
|
Director
|
|
March 15, 2017
|
Judith A. Hannaway
|
|
|
|
|
|
|
|
|
|
/s/ WESLEY D. MINAMI
|
|
Director
|
|
March 15, 2017
|
Wesley D. Minami
|
|
|
|
|
|
|
|
|
|
/s/ MARIO CHISHOLM
|
|
Director
|
|
March 15, 2017
|
Mario Chisholm
|
|
|
|
|
|
|
|
|
|
/s/ OSCAR JUNQUERA
|
|
Director
|
|
March 15, 2017
|
Oscar Junquera
|
|
|
|
|
|
|
|
|
|
/s/ DIANNE HURLEY
|
|
Director
|
|
March 15, 2017
|
Dianne Hurley
|
|
|
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1 Year NorthStar Realty Europe Chart |
1 Month NorthStar Realty Europe Chart |
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