AvalonBay Communities, Inc. Announces Avalon Chrystie Place Disposition
AvalonBay Communities, Inc. (NYSE:AVB) (the “Company”) announced today the disposition of Avalon Chrystie Place, a 361 unit apartment home community located in New York, New York, in which the Company owned a 20% joint venture interest.
Avalon Chrystie Place was sold for a gross sales price of $365 million. Subject to the wind-down of the joint-venture, AvalonBay expects to receive net proceeds of $108 million, including $50 million of distributions in respect of its 20% joint venture interest which will be recorded as gain on sale and not included in the calculation of Funds from Operations (“FFO”), and $58 million of distributions in respect of its promoted interest, which will be included in the calculation of FFO. The Company’s initial capital investment in the joint venture was $6 million.
Definitions and Notes
All dollar amounts cited in this release are approximations.
FFO is determined based on a definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”). FFO is calculated by the Company as Net income or loss attributable to common stockholders computed in accordance with GAAP, adjusted for gains or losses on sales of previously depreciated operating communities, extraordinary gains or losses (as defined by GAAP), cumulative effect of a change in accounting principle, impairment write-downs of depreciable real estate assets, write-downs of investments in affiliates which are driven by a decrease in the value of depreciable real estate assets held by the affiliate and depreciation of real estate assets, including adjustments for unconsolidated partnerships and joint ventures. Management generally considers FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses related to dispositions of previously depreciated operating communities and excluding real estate depreciation (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO can help one compare the operating performance of a company’s real estate between periods or as compared to different companies.
About AvalonBay Communities, Inc.
As of June 30, 2014, the Company owned or held a direct or indirect ownership interest in 275 apartment communities containing 82,348 apartment homes in eleven states and the District of Columbia, of which 32 communities were under construction and six communities were under reconstruction. The Company is an equity REIT in the business of developing, redeveloping, acquiring and managing apartment communities in high barrier-to-entry markets of the United States. More information may be found on the Company’s website at http://www.avalonbay.com.
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