• LXP Industrial Trust Reports Fourth Quarter 2021 Results

    Source: Nasdaq GlobeNewswire / 24 Feb 2022 06:00:01   America/New_York

    NEW YORK, Feb. 24, 2022 (GLOBE NEWSWIRE) -- LXP Industrial Trust (“LXP”) (NYSE:LXP), a real estate investment trust focused on single-tenant warehouse/distribution real estate investments, today announced results for the fourth quarter and year ended December 31, 2021.

    Fourth Quarter 2021 Highlights

    • Recorded Net Income attributable to common shareholders of $260.5 million, or $0.90 per diluted common share.
    • Generated Adjusted Company Funds From Operations available to all equityholders and unitholders - diluted (“Adjusted Company FFO”) of $53.8 million, or $0.18 per diluted common share.
    • Recapitalized 22 special purpose industrial assets with a gross valuation of $550 million to a newly-formed joint venture and acquired a 20% interest in the joint venture for $30.8 million.
    • Fully leased an aggregate of 1.7 million square feet of speculative development warehouse/distribution product in the Atlanta, Georgia and Greenville-Spartanburg, South Carolina markets.
    • Completed additional 1.5 million square feet of new leases and lease extensions, raising industrial Base and Cash Base Rents by 12.8% and 5.3%, respectively.
    • Acquired eight warehouse/distribution facilities for an aggregate cost of approximately $365.9 million.
    • Acquired an aggregate of 490 acres of developable land in the Phoenix, Arizona and Indianapolis, Indiana markets for an aggregate investment of $98.9 million.
    • Completed the 468,000 square foot build-to-suit warehouse/distribution facility in the Phoenix, Arizona market.
    • Commenced development of a 1.1 million square foot warehouse/distribution facility in the Columbus, Ohio market.
    • Invested an aggregate of approximately $46.7 million in five ongoing development projects.
    • Disposed of five additional properties for an aggregate gross disposition price of $57.9 million.
    • Increased warehouse/distribution portfolio to 98.1% of gross real estate assets, excluding held for sale assets.

    Full Year 2021 Highlights

    • Recorded Net Income attributable to common shareholders of $375.8 million, or $1.34 per diluted common share.
    • Generated Adjusted Company FFO of $223.2 million, or $0.78 per diluted common share.
    • Completed 8.5 million square feet of new leases and lease extensions, raising industrial Base and Cash Base Rents by 10.9% and 6.7%, respectively.
    • Acquired/completed 26 warehouse/distribution facilities for an aggregate cost of $885.6 million.
    • Invested an aggregate of $111.5 million in five ongoing development projects.
    • Disposed of 37 properties for an aggregate gross disposition price of $824.0 million.
    • Issued $400.0 million aggregate principal amount of 2.375% Senior Notes due 2031 and redeemed all $188.8 million aggregate principal amount of 4.25% Senior Notes due 2023.
    • Satisfied $42.3 million of secured debt with a weighted-average interest rate of 5.6%.

    Subsequent Events

    • Acquired two warehouse/distribution facilities for an aggregate cost of approximately $71.8 million.

    Adjusted Company FFO is a non-GAAP financial measure. It and certain other non-GAAP financial measures are defined and reconciled later in this press release.

    T. Wilson Eglin, Chairman, Chief Executive Officer and President of LXP, commented “Several years ago we began executing on a long-term strategic plan to reposition LXP as a leading, pure-play industrial REIT, and in 2021 we substantially completed our transformation and delivered outstanding financial and operational results. Our warehouse and distribution portfolio was 99.8% leased at year-end, demonstrating strong tenant demand and positioning us to continue benefiting from strong underlying market rent growth. We continued to build on our momentum in the fourth quarter, executing 1.7 million square feet of full building leases on two development projects and advancing five development projects totaling 6.3 million square feet. With a significantly more valuable portfolio, a strong tenant base, attractive lease escalations and a deep pipeline of development projects, we entered 2022 in a strong position. We are pleased with LXP’s tremendous progress and strong results, and look forward to pursuing the best path to unlock the full value of our company following our ongoing review of strategic alternatives.”

    FINANCIAL RESULTS

    Revenues

    For the quarter ended December 31, 2021, total gross revenues were $86.5 million, compared with total gross revenues of $83.3 million for the quarter ended December 31, 2020. The increase was primarily attributable to an increase in rental revenue due to property acquisitions and an increase in tenant reimbursements, partially offset by a decrease in rental revenue due to property sales.

    Net Income Attributable to Common Shareholders

    For the quarter ended December 31, 2021, net income attributable to common shareholders was $260.5 million, or $0.90 per diluted share, compared with net income attributable to common shareholders for the quarter ended December 31, 2020 of $102.7 million, or $0.37 per diluted share.

    Adjusted Company FFO

    For the quarter ended December 31, 2021, LXP generated Adjusted Company FFO of $53.8 million, or $0.18 per diluted share, compared to Adjusted Company FFO for the quarter ended December 31, 2020 of $55.0 million, or $0.19 per diluted share.

    Dividends/Distributions

    As previously announced, during the fourth quarter of 2021, LXP declared its quarterly common share/unit dividend/distribution for the quarter ended December 31, 2021 of $0.12 per common share/unit, which was paid on January 18, 2022 to common shareholders/unitholders of record as of December 31, 2021. LXP previously declared a dividend of $0.8125 per share on its Series C Cumulative Convertible Preferred Stock (“Series C Preferred”) for the quarter ended December 31, 2021, which was paid February 15, 2022 to Series C Preferred shareholders of record as of January 31, 2022.

    TRANSACTION ACTIVITY

    ACQUISITIONS AND COMPLETED DEVELOPMENT TRANSACTIONS  
    Property Type Market Sq. Ft. Initial Basis
    ($000)    		 Primary Tenant Approximate
    Lease Term
    (Yrs)    		 % Leased
    as of
    12/31/2021
    Warehouse/distribution Indianapolis, IN 179,530 $16,315 5.2 100%
    Warehouse/distribution Indianapolis, IN 530,400  44,479 9.5 100%
    Warehouse/distribution Indianapolis, IN 168,480  15,644 5.2 100%
    Warehouse/distribution(1)(2) Atlanta, GA 907,675  47,568 7.0 100%
    Warehouse/distribution(1) Phoenix, AZ 468,182  61,490 15.1 100%
    Warehouse/distribution Phoenix, AZ 487,500  83,517 10.0 33%
    Warehouse/distribution Indianapolis, IN 1,016,244  93,899 9.9 100%
    Warehouse/distribution Atlanta, GA 328,000  37,625 9.6 100%
    Warehouse/distribution Atlanta, GA 396,000  47,618 9.8 100%
    Warehouse/distribution Atlanta, GA 225,211  26,838 3.8 45%
        4,707,222 $474,993    

    1. Completed development project.
    2. Initial basis excludes certain remaining costs, including developer partner promote.

    The above properties were acquired/completed at aggregate weighted-average GAAP and Cash stabilized capitalization rates of 4.8% and 4.4%, respectively. Total 2021 acquisition activity, including development projects placed into service, was approximately $885.6 million at aggregate weighted-average GAAP and Cash estimated stabilized capitalization rates of 4.9% and 4.6%, respectively.

    DEVELOPMENT PROJECTS    
                     
    Project (% owned) # of Buildings Market Estimated
    Sq. Ft.    		 Estimated Project
    Cost
    ($000)    		 GAAP Investment Balance
    as of
    12/31/21
    ($000)    		 LXP Amount Funded
    as of
    12/31/21
    ($000)(4)    		 Estimated Building Completion Date % Leased as of 12/31/21
    Consolidated:                
    The Cubes at Etna East (95%)(1)(2) 1 Columbus, OH 1,074,840 $72,100 $33,002 $22,471 2Q 2022 —%
    Mt. Comfort (80%)(1) 1 Indianapolis, IN 1,053,360  60,300  30,012  21,977 3Q 2022 —%
    Cotton 303 (93%)(1) 2 Phoenix, AZ 880,678  84,200  30,263  24,475 3Q 2022 —%
    Ocala (80%)(1) 1 Central Florida 1,085,280  80,900  32,186  21,186 3Q 2022 —%
    Smith Farms(90%)(1)(3) 3 Greenville-Spartanburg, SC 2,194,820  162,100  35,702  21,433 4Q 2022 - 2Q 2023 36%
            $459,600 $161,165 $111,542    


    LAND HELD FOR DEVELOPMENT


    Project (% owned) Market Approx. Developable Acres GAAP Investment Balance
    as of
    12/31/21
    ($000)    		 LXP Amount Funded
    as of
    12/31/21
    ($000)(4)
    Consolidated:        
    Reems & Olive (95.5%) Phoenix, AZ 420 $        100,875         $        96,336        
    Mt. Comfort Phase II (80%) Indianapolis, IN 70          3,285                  2,610        
        490 $        104,160         $        98,946        


    Project (% owned) Market Approx. Developable Acres GAAP Investment Balance
    as of
    12/31/21
    ($000)    		 LXP Amount Funded
    as of
    12/31/21
    ($000)(4)
    Non-consolidated:        
    ETNA Park 70 (90%) Columbus, OH 66 $        12,875         $        13,362        
    ETNA Park 70 East (90%) Columbus, OH 21          2,797                  2,064        
        87 $        15,672         $        15,426        

    1. Estimated project cost includes estimated tenant improvements and leasing costs and excludes potential developer partner promote.
    2. Land parcel distributed from ETNA Park 70 East during the fourth quarter of 2021.
    3. Preleased one 797,936 square foot facility subject to a 12-year lease commencing upon substantial completion of the facility.
    4. Excludes noncontrolling interests' share.

    PROPERTY DISPOSITIONS
     Location Property Type Gross Disposition
    Price
    ($000)    		 Annualized Net Income(1) ($000) Annualized
    NOI(1)
    ($000)    		 Month of Disposition % Leased
     Durham, NH Industrial $21,024 $(431) $(336) October 9%
     Baton Rouge, LA Office  4,471  103   304  October 36%
     Arlington, TX (2 properties) Office/Industrial  29,250  2,992   3,056  November 96%
     Florence, SC Office  3,200  408   611  December 100%
     Various(2) Industrial  547,226  20,894   39,515  December 100%
         $605,171 $23,966  $43,150     

    1. Generally, quarterly period prior to sale, annualized.
    2. Recapitalized 22 special purpose industrial assets into a newly-formed joint venture. Joint venture received $2.8 million in credits. LXP acquired a 20% interest in the joint venture for $30.8 million.

    As of December 31, 2021, total consolidated 2021 property disposition volume was $824.0 million at aggregate weighted-average GAAP and Cash capitalization rates of 7.5% and 7.3%, respectively.

    LEASING

    During the fourth quarter of 2021, LXP executed the following extensions and new leases:

      NEW LEASES - FIRST GENERATION(1)    
            
      Location Lease
    Expiration Date    		 Sq. Ft.
      Industrial    
    1 FairburnGA 10/2028           907,675  
    2 Greer(2)SC 03/2035           797,936  
    2 TOTAL NEW LEASES - FIRST GENERATION          1,705,611  


      LEASE EXTENSIONS - SECOND GENERATION    
              
      Location Prior
    Term    		 Lease
    Expiration Date    		 Sq. Ft.
      Industrial      
    1 RockfordIL 12/2021 12/2024 93,000 
    2 Olive BranchMS 08/2024 06/2029 1,170,218 
    3 DuncanSC 08/2022 08/2027 221,833 
    3 Total industrial lease extensions      1,485,051 
               
      Other        
    1 TucsonAZ 07/2022 09/2027 28,591 
    1 Total other lease extensions      28,591 
              
    4 Total lease extensions - second generation     1,513,642 
               


      NEW LEASES - SECOND GENERATION    
            
      Location Lease Expiration Date Sq. Ft.
      Other    
    1 KalamazooMI MTM              3,880  
    2 KalamazooMI 10/2024             29,686  
             
    2 Total other new leases - second generation               33,566  
             
    6 TOTAL NEW AND EXTENDED LEASES - SECOND GENERATION          1,547,208  


    1. Leased first generation space that was developed or acquired vacant.
    2. Property included in the Smith Farms development. The lease expiration date is estimated.

    As of December 31, 2021, LXP's Stabilized Portfolio was 99.4% leased. A total of 8.4 million square feet of new and extended industrial leases were entered into during 2021. Base and Cash Base Rents increased by 12.4% and 5.8%, respectively, for extended industrial leases and by 8.3% each for new industrial leases (as compared to the prior tenants' rent, if any).

    BALANCE SHEET/CAPITAL MARKETS

    In the fourth quarter of 2021, LXP satisfied an aggregate of $29.9 million of non-recourse debt with a weighted-average interest rate of 5.4%. LXP's total debt was $1.5 billion at quarter end with a weighted-average term to maturity of 7.5 years and a fixed rate of 2.8%.

    In the fourth quarter of 2021, LXP issued 1.1 million shares previously sold on a forward basis under its At-the-Market offering program for net proceeds of $11.6 million. As of December 31, 2021, LXP had an aggregate of $226.1 million under unsettled forward common share contracts, which are subject to adjustment in accordance with the forward sales contracts.

    LXP ended 2021 at 5.5x Net Debt to Adjusted EBITDA. LXP's $600.0 million unsecured revolving credit facility remains fully available.

    REVIEW STRATEGIC ALTERNATIVES TO MAXIMIZE SHAREHOLDER VALUE

    As previously announced on February 8, 2022, the LXP Board of Trustees has initiated a review of strategic alternatives. With the support of its independent financial advisors, the Board is considering a wide range of options including, among other things, a sale, merger and other business combinations.

    LXP has not set a timetable for the review process, nor has it made any decisions related to any potential strategic alternatives at this time. There can be no assurance that the review process will result in a transaction or other strategic change or outcome. LXP does not intend to disclose or comment on developments related to this review unless or until it determines that further disclosure is appropriate or required by law.

    BofA Securities, Evercore and Wells Fargo Securities are serving as LXP’s financial advisors and Paul Hastings LLP is serving as legal counsel.

    2022 EARNINGS GUIDANCE

    LXP is delaying the issuance of its estimates of net income attributable to common shareholders per diluted common share for the year ending December 31, 2022 and its estimate of Adjusted Company FFO for the year ending December 31, 2022 pending the completion of the previously announced review of strategic alternatives being conducted by its Board of Trustees.

    FOURTH QUARTER 2021 CONFERENCE CALL

    LXP will host a conference call today February 24, 2022, at 8:30 a.m. Eastern Time, to discuss its results for the quarter ended December 31, 2021. Interested parties may participate in this conference call by dialing 1-844-200-6205 (U.S.) or 1-929-526-1599 (All other locations). Access code is 323564. A replay of the call will be available through March 24, 2022, at 1-866-813-9403 (U.S.) or +44-204-525-0658 (All other locations); pin code for all replay numbers is 075603. A link to a live webcast of the conference call is available at www.lxp.com within the Investors section.

    LXP Industrial Trust (NYSE: LXP) is a publicly traded real estate investment trust (REIT) focused on single-tenant industrial real estate investments across the United States. LXP seeks to expand its industrial portfolio through acquisitions, build-to-suit transactions, sale-leaseback transactions, development projects and other transactions. For more information, including LXP's Quarterly Supplemental Information package, or to follow LXP on social media, visit www.lxp.com.

    Contact:
    Investor or Media Inquiries for LXP Industrial Trust:
    Heather Gentry, Senior Vice President of Investor Relations
    LXP Industrial Trust
    Phone: (212) 692-7200 E-mail: hgentry@lxp.com

    This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under LXP's control which may cause actual results, performance or achievements of LXP to be materially different from the results, performance, or other expectations implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the headings “Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in LXP's periodic reports filed with the Securities and Exchange Commission, including risks related to: (1) the potential adverse impact on LXP or its tenants from the novel coronavirus (COVID-19), (2) the authorization by LXP's Board of Trustees of future dividend declarations, (3) the successful consummation of any lease, acquisition, build-to-suit, development project, disposition, financing or other transaction, (4) the failure to continue to qualify as a real estate investment trust, (5) changes in general business and economic conditions, including the impact of any legislation, (6) competition, (7) increases in real estate construction costs, (8) changes in interest rates, (9) changes in accessibility of debt and equity capital markets, and (10) future impairment charges. Copies of the periodic reports LXP files with the Securities and Exchange Commission are available on LXP's web site at www.lxp.com. Forward-looking statements, which are based on certain assumptions and describe LXP's future plans, strategies and expectations, are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects”, “may,” “plans,” “predicts,” “will,” “will likely result,” “is optimistic,” “goal,” “objective” or similar expressions. Except as required by law, LXP undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that LXP's expectations will be realized.

    References to LXP refer to LXP Industrial Trust and its consolidated subsidiaries. All interests in properties and loans are held, and all property operating activities are conducted, through special purpose entities, which are separate and distinct legal entities that maintain separate books and records, but in some instances are consolidated for financial statement purposes and/or disregarded for income tax purposes. The assets and credit of each special purpose entity with a property subject to a mortgage loan are not available to creditors to satisfy the debt and other obligations of any other person, including any other special purpose entity or affiliate. Consolidated entities that are not property owner subsidiaries do not directly own any of the assets of a property owner subsidiary (or the general partner, member of managing member of such property owner subsidiary), but merely hold partnership, membership or beneficial interests therein which interests are subordinate to the claims of the property owner subsidiary's (or its general partner's, member's or managing member's) creditors.

    Non-GAAP Financial Measures - Definitions

    LXP has used non-GAAP financial measures as defined by the Securities and Exchange Commission Regulation G in this Quarterly Earnings Release and in other public disclosures.

    LXP believes that the measures defined below are helpful to investors in measuring our performance or that of an individual investment. Since these measures exclude certain items which are included in their respective most comparable measures under generally accepted accounting principles (“GAAP”), reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP measures. These measures are not necessarily indications of our cash flow available to fund cash needs. Additionally, they should not be used as an alternative to the respective most comparable GAAP measures when evaluating LXP's financial performance or cash flow from operating, investing or financing activities or liquidity.

    Adjusted EBITDA: Adjusted EBITDA represents EBITDA (earnings before interest, taxes, depreciation and amortization) modified to include other adjustments to GAAP net income for gains on sales of properties, impairment charges, debt satisfaction gains (losses), net, non-cash charges, net, straight-line adjustments, non-recurring charges and adjustments for pro-rata share of non-wholly owned entities. LXP's calculation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. LXP believes that net income is the most directly comparable GAAP measure to Adjusted EBITDA.

    Base Rent: Base Rent is calculated by making adjustments to GAAP rental revenue to exclude billed tenant reimbursements and lease termination income and to include ancillary income. Base Rent excludes reserves/write-offs of deferred rent receivable, as applicable. LXP believes Base Rent provides a meaningful measure due to the net lease structure of leases in the portfolio.

    Cash Base Rent: Cash Base Rent is calculated by making adjustments to GAAP rental revenue to remove the impact of GAAP required adjustments to rental income such as adjustments for straight-line rents related to free rent periods and contractual rent increases. Cash Base Rent excludes billed tenant reimbursements and lease termination income and includes ancillary income. LXP believes Cash Base Rent provides a meaningful indication of an investments ability to fund cash needs.

    Company Funds Available for Distribution (“FAD”): FAD is calculated by making adjustments to Adjusted Company FFO (see below) for (1) straight-line adjustments, (2) lease incentive amortization, (3) amortization of above/below market leases, (4) lease termination payments, net, (5) non-cash interest, net, (6) non-cash charges, net, (7) cash paid for second generation tenant improvements, and (8) cash paid for second generation lease costs. Although FAD may not be comparable to that of other real estate investment trusts (“REITs”), LXP believes it provides a meaningful indication of its ability to fund cash needs. FAD is a non-GAAP financial measure and should not be viewed as an alternative measurement of operating performance to net income, as an alternative to net cash flows from operating activities or as a measure of liquidity.

    First Generation Costs: Represents cash spend for tenant improvements, leasing costs and base building work for in-service development projects and expenditures contemplated at acquisition for recently acquired properties. Because all companies do not calculate First Generation Costs the same way, LXP's presentation may not be comparable to similarly titled measures of other companies.

    Funds from Operations (“FFO”) and Adjusted Company FFO: LXP believes that Funds from Operations, or FFO, which is a non-GAAP measure, is a widely recognized and appropriate measure of the performance of an equity REIT. LXP believes FFO is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. As a result, FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, interest costs and other matters without the inclusion of depreciation and amortization, providing perspective that may not necessarily be apparent from net income.

    The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as “net income (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sales of certain real estate assets, gains and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO.” FFO does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs.

    LXP presents FFO available to common shareholders and unitholders - basic and also presents FFO available to all equityholders and unitholders - diluted on a company-wide basis as if all securities that are convertible, at the holder's option, into LXP’s common shares, are converted at the beginning of the period. LXP also presents Adjusted Company FFO available to all equityholders and unitholders - diluted which adjusts FFO available to all equityholders and unitholders - diluted for certain items which we believe are not indicative of the operating results of LXP's real estate portfolio. LXP believes this is an appropriate presentation as it is frequently requested by security analysts, investors and other interested parties. Since others do not calculate these measures in a similar fashion, these measures may not be comparable to similarly titled measures as reported by others. These measures should not be considered as an alternative to net income as an indicator of LXP’s operating performance or as an alternative to cash flow as a measure of liquidity.

    GAAP and Cash Yield or Capitalization Rate: GAAP and cash yields or capitalization rates are measures of operating performance used to evaluate the individual performance of an investment. These measures are estimates and are not presented or intended to be viewed as a liquidity or performance measure that present a numerical measure of LXP's historical or future financial performance, financial position or cash flows. The yield or capitalization rate is calculated by dividing the annualized NOI (as defined below, except GAAP rent adjustments are added back to rental income to calculate GAAP yield or capitalization rate) the investment is expected to generate, (or has generated) divided by the acquisition/completion cost, (or sale price). Stabilized yields assume 100% occupancy and the payment of estimated costs to achieve 100% occupancy including partner promotes, if any.

    Net Operating Income (“NOI”): NOI is a measure of operating performance used to evaluate the individual performance of an investment. This measure is not presented or intended to be viewed as a liquidity or performance measure that presents a numerical measure of LXP's historical or future financial performance, financial position or cash flows. LXP defines NOI as operating revenues (rental income (less GAAP rent adjustments and lease termination income, net), and other property income) less property operating expenses. Other REITs may use different methodologies for calculating NOI, and accordingly, LXP's NOI may not be comparable to other companies. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. LXP believes that net income is the most directly comparable GAAP measure to NOI.

    Second Generation Costs: Represents cash spend for tenant improvements and leasing costs to maintain revenues at existing properties and are a component of the FAD calculation.

    Stabilized Portfolio: All real estate properties other than acquired or developed properties that have not achieved 90% occupancy within one-year of acquisition or substantial completion.

    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (Unaudited and in thousands, except share and per share data)

     Three months ended December 31, Twelve months ended December 31,
      2021   2020   2021   2020 
    Gross revenues:       
    Rental revenue$85,374  $82,390  $339,944  $325,811 
    Other revenue 1,108   925   4,053   4,637 
    Total gross revenues 86,482   83,315   343,997   330,448 
    Expense applicable to revenues:       
    Depreciation and amortization (46,135)  (40,723)  (176,714)  (161,592)
    Property operating (13,780)  (10,019)  (47,746)  (41,914)
    General and administrative (10,763)  (7,759)  (35,458)  (30,371)
    Non-operating income 411   429   1,364   743 
    Interest and amortization expense (11,538)  (12,591)  (46,708)  (55,201)
    Debt satisfaction gains (losses), net (672)  2,502   (13,894)  21,452 
    Impairment charges (3,493)  (6,668)  (5,541)  (14,460)
    Gains on sales of properties 262,507   97,163   367,274   139,039 
    Income before provision for income taxes and equity in earnings (losses) of non-consolidated entities 263,019   105,649   386,574   188,144 
    Provision for income taxes (307)  (223)  (1,293)  (1,584)
    Equity in earnings (losses) of non-consolidated entities 59   (204)  (190)  (169)
    Net income 262,771   105,222   385,091   186,391 
    Less net income attributable to noncontrolling interests (481)  (844)  (2,443)  (3,089)
    Net income attributable to LXP Industrial Trust shareholders 262,290   104,378   382,648   183,302 
    Dividends attributable to preferred shares – Series C (1,572)  (1,572)  (6,290)  (6,290)
    Allocation to participating securities (258)  (94)  (510)  (224)
    Net income attributable to common shareholders$260,460  $102,712  $375,848  $176,788 
    Net income attributable to common shareholders – per common share basic$0.93  $0.37  $1.35  $0.66 
    Weighted-average common shares outstanding – basic 281,383,061   274,965,603   277,640,835   266,914,843 
    Net income attributable to common shareholders – per common share diluted$0.90  $0.37  $1.34  $0.66 
    Weighted-average common shares outstanding – diluted 292,782,489   284,076,532   287,369,742   268,182,552 

    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    CONDENSED CONSOLIDATED BALANCE SHEETS
    As of December 31,
    (Unaudited and in thousands, except share and per share data)

      2021   2020 
    Assets:   
    Real estate, at cost$3,583,978  $3,514,564 
    Real estate - intangible assets 341,403   409,293 
    Land held for development 104,160   — 
    Investments in real estate under construction 161,165   75,906 
    Real estate, gross 4,190,706   3,999,763 
    Less: accumulated depreciation and amortization 655,740   884,465 
    Real estate, net 3,534,966   3,115,298 
    Assets held for sale 82,586   16,530 
    Right-of-use assets, net 27,966   31,423 
    Cash and cash equivalents 190,926   178,795 
    Restricted cash 101   626 
    Investments in non-consolidated entities 74,559   56,464 
    Deferred expenses, net 18,861   15,901 
    Rent receivable - current 3,526   2,899 
    Rent receivable - deferred 63,283   66,959 
    Other assets 8,784   8,331 
    Total assets$4,005,558  $3,493,226 
        
    Liabilities and Equity:   
    Liabilities:   
    Mortgages and notes payable, net$83,092  $136,529 
    Term loan payable, net 298,446   297,943 
    Senior notes payable, net 987,931   779,275 
    Trust preferred securities, net 127,595   127,495 
    Dividends payable 37,425   35,401 
    Liabilities held for sale 3,468   790 
    Operating lease liabilities 29,094   32,515 
    Accounts payable and other liabilities 77,607   55,208 
    Accrued interest payable 8,481   6,334 
    Deferred revenue - including below market leases, net 14,474   17,264 
    Prepaid rent 14,717   13,335 
    Total liabilities 1,682,330   1,502,089 
        
    Commitments and contingencies   
    Equity:   
    Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares,   
    Series C Cumulative Convertible Preferred, liquidation preference $96,770 and 1,935,400 shares issued and outstanding 94,016   94,016 
    Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 283,752,726 and 277,152,450 shares issued and outstanding in 2021 and 2020, respectively 28   28 
    Additional paid-in-capital 3,252,506   3,196,315 
    Accumulated distributions in excess of net income (1,049,434)  (1,301,726)
    Accumulated other comprehensive loss (6,258)  (17,963)
    Total shareholders’ equity 2,290,858   1,970,670 
    Noncontrolling interests 32,370   20,467 
    Total equity 2,323,228   1,991,137 
    Total liabilities and equity$4,005,558  $3,493,226 


    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    EARNINGS PER SHARE
    (Unaudited and in thousands, except share and per share data)


      Three Months Ended
    December 31,    		 Twelve Months Ended
    December 31,
       2021  2020  2021  2020
    EARNINGS PER SHARE:        
             
    Basic:        
    Net income attributable to common shareholders $260,460 $102,712 $375,848 $176,788
             
    Weighted-average common shares outstanding - basic  281,383,061  274,965,603  277,640,835  266,914,843
             
    Net income attributable to common shareholders - per common share basic $0.93 $0.37 $1.35 $0.66
             
    Diluted:        
    Net income attributable to common shareholders - basic $260,460 $102,712 $375,848 $176,788
    Impact of assumed conversions  1,853  2,218  7,962  —
    Net income attributable to common shareholders $262,313 $104,930 $383,810 $176,788
             
    Weighted-average common shares outstanding - basic  281,383,061  274,965,603  277,640,835  266,914,843
    Effect of dilutive securities:        
    Unvested share-based payment awards and options  1,223,218  1,367,634  989,177  1,267,709
    Shares issuable under forward sales agreements  4,568,350  —  2,110,315  —
    Operating Partnership Units  897,290  3,032,725  1,918,845  —
    Preferred shares - Series C  4,710,570  4,710,570  4,710,570  —
    Weighted-average common shares outstanding - diluted  292,782,489  284,076,532  287,369,742  268,182,552
             
    Net income attributable to common shareholders - per common share diluted $0.90 $0.37 $1.34 $0.66


    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    ADJUSTED COMPANY FUNDS FROM OPERATIONS & FUNDS AVAILABLE FOR DISTRIBUTION
    (Unaudited and in thousands, except share and per share data)
           
      Three Months Ended
    December 31,    		 Twelve Months Ended
    December 31,
       2021   2020   2021   2020 
    FUNDS FROM OPERATIONS:      
    Basic and Diluted:       
    Net income attributable to common shareholders$260,460  $102,712  $375,848  $176,788 
    Adjustments:       
     Depreciation and amortization 45,391   40,050   173,833   158,655 
     Impairment charges - real estate 3,493   6,668   5,541   14,460 
     Noncontrolling interests - OP units 281   645   1,672   2,347 
     Amortization of leasing commissions 744   673   2,881   2,937 
     Joint venture and noncontrolling interest adjustment 2,026   2,115   8,370   8,578 
     Gains on sales of properties, including non-consolidated entities (262,507)  (97,163)  (367,274)  (139,596)
    FFO available to common shareholders and unitholders - basic 49,888   55,700   200,871   224,169 
     Preferred dividends 1,572   1,572   6,290   6,290 
     Amount allocated to participating securities 258   94   510   224 
    FFO available to all equityholders and unitholders - diluted 51,718   57,366   207,671   230,683 
     Debt satisfaction (gains) losses, net, including non-consolidated entities 672   (2,502)  13,894   (21,396)
     Activist costs 1,199   —   1,199   — 
     Transaction costs 227   174   432   255 
    Adjusted Company FFO available to all equityholders and unitholders - diluted 53,816   55,038   223,196   209,542 
            
    FUNDS AVAILABLE FOR DISTRIBUTION:       
    Adjustments:       
     Straight-line adjustments (4,178)  (3,430)  (12,324)  (13,654)
     Lease incentives 175   189   780   921 
     Amortization of above/below market leases (340)  (470)  (1,551)  (1,580)
     Lease termination payments, net (330)  (70)  551   — 
     Non-cash interest, net (25)  195   326   1,276 
     Non-cash charges, net 1,796   1,690   7,137   6,674 
     Second generation tenant improvements (4,214)  (291)  (8,392)  (9,744)
     Second generation lease costs (1,810)  (50)  (7,151)  (5,019)
     Joint venture and non-controlling interest adjustment (194)  11   (375)  (319)
    Company Funds Available for Distribution$44,696  $52,812  $202,197  $188,097 
             
    Per Common Share and Unit Amounts       
    Basic:       
     FFO$0.18  $0.20  $0.72  $0.83 
              
    Diluted:       
     FFO$0.18  $0.20  $0.72  $0.84 
     Adjusted Company FFO$0.18  $0.19  $0.78  $0.76 
              
    Weighted-Average Common Shares       
    Basic:       
     Weighted-average common shares outstanding - basic EPS 281,383,061   274,965,603   277,640,835   266,914,843 
     Operating partnership units(1) 897,290   3,032,725   1,918,845   3,083,320 
     Weighted-average common shares outstanding - basic FFO 282,280,351   277,998,328   279,559,680   269,998,163 
              
    Diluted:       
     Weighted-average common shares outstanding - diluted EPS 292,782,489   284,076,532   287,369,742   268,182,552 
     Unvested share-based payment awards 70,114   9,384   44,261   17,180 
     Operating partnership units(1) —   —   —   3,083,320 
     Preferred shares - Series C —   —   —   4,710,570 
     Weighted-average common shares outstanding - diluted FFO 292,852,603   284,085,916   287,414,003   275,993,622 

    (1) Includes OP units other than OP units held by LXP.


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