8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 12, 2015

 

 

ARMADA HOFFLER PROPERTIES, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Maryland   001-35908   46-1214914

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

222 Central Park Avenue, Suite 2100

Virginia Beach, Virginia

  23462
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (757) 366-4000

Not Applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02. Results of Operations and Financial Condition.

On February 12, 2015, Armada Hoffler Properties, Inc. (the “Company”) issued a press release announcing its financial position as of December 31, 2014, results of operations for the three and twelve months ended December 31, 2014 and other related information. Also on February 12, 2015, the Company made available on its website at www.ArmadaHoffler.com certain supplemental information concerning the Company’s financial results and operations for the three and twelve months ended December 31, 2014. Copies of such press release and supplemental information are furnished as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.

In accordance with General Instructions B.2 and B.6 of Form 8-K, the information included in this Current Report on Form 8-K, including Exhibits 99.1 and 99.2 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing made by the Company under the Exchange Act or Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

 

Item 7.01. Regulation FD Disclosure.

The disclosure contained in Item 2.02 is incorporated herein by reference.

 

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit
No.

  

Description

99.1    Press Release, dated February 12, 2015, issued by Armada Hoffler Properties, Inc., providing its financial position as of December 31, 2014 and results of operations for the three and twelve months ended December 31, 2014.
99.2    Armada Hoffler Properties, Inc. Fourth Quarter 2014 Supplemental Information.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

ARMADA HOFFLER PROPERTIES, INC.
Date: February 12, 2015 /S/ MICHAEL P. O’HARA
Michael P. O’Hara
Chief Financial Officer and Treasurer


EXHIBIT INDEX

 

Exhibit
No.

  

Description

99.1    Press Release, dated February 12, 2015, issued by Armada Hoffler Properties, Inc., providing its financial position as of December 31, 2014 and results of operations for the three and twelve months ended December 31, 2014.
99.2    Armada Hoffler Properties, Inc. Fourth Quarter 2014 Supplemental Information.
EX-99.1

Exhibit 99.1

LOGO

ARMADA HOFFLER PROPERTIES REPORTS FOURTH QUARTER 2014 RESULTS

FFO of $0.20 Per Diluted Share

Operating Property Portfolio at 95.7% Occupancy

Company Introduces 2015 Normalized FFO Guidance of

$0.85 to $0.90 Per Diluted Share

VIRGINIA BEACH, VA, February 12, 2015 — Armada Hoffler Properties, Inc. (NYSE: AHH) today announced its results for the quarter ended December 31, 2014.

Highlights include:

 

    Funds From Operations (“FFO”) of $8.0 million, or $0.20 per diluted share, for the quarter ended December 31, 2014. FFO of $28.1 million, or $0.80 per diluted share, for the full-year 2014.

 

    Core FFO of $7.9 million, or $0.20 per diluted share, for the quarter ended December 31, 2014. Core FFO of $29.4 million, or $0.84 per diluted share, for the full-year 2014.

 

    Occupancy up to 95.7%, compared to 95.1% as of September 30, 2014 and 94.4% as of December 31, 2013.

 

    Increased quarterly GAAP and Cash Same Store Net Operating Income (“NOI”) 2.9% and 3.0%, respectively, compared to the fourth quarter of 2013.

 

    Increased annual GAAP and Cash Same Store NOI 2.0% and 0.7%, respectively, compared to the full-year 2013.

 

    In the fourth quarter, completed the sale of the Virginia Natural Gas office building for approximately $8.9 million, representing a cap rate of 6.25%.

 

    In January 2015, completed the sale of the Sentara Williamsburg office building for approximately $15.4 million, representing a cap rate of 6.3%.

 

    Entered into agreements to acquire two grocery anchored retail centers located in Maryland. These pending acquisitions will add over 185,000 square feet to the Company’s portfolio with a combined occupancy of approximately 90%. The Company intends to acquire 100% interests in these centers in exchange for a combination of common stock and cash including the net proceeds from the Sentara Williamsburg sale. These acquisitions are expected to be accretive to 2015 FFO per diluted share and are expected to close by the end of the first quarter of 2015. Both transactions are subject to customary closing conditions.


February 12, 2015

Page 2 of 9

 

    Entered into a commitment with a syndicate of banks co-led by Bank of America and Regions Bank for a new, expanded and unsecured $200 million credit facility that includes a $50 million term loan.

 

    Declared a cash dividend of $0.17 per common share for the first quarter of 2015, representing a 6.3% increase over the prior quarter’s cash dividend. The first quarter dividend will be payable on April 9, 2015 to stockholders of record on April 1, 2015.

“We continue to be very pleased by the performance and trajectory of our Company,” commented Louis Haddad, Chief Executive Officer. “We delivered all of our 2014 projects on schedule and on budget and are poised to deliver four more projects and complete two property acquisitions in the first quarter of 2015. On the financing front, we entered into a commitment for a new unsecured credit facility and increased our dividend by 6.3%.”

Financial Results

Net income for the fourth quarter increased 82% to $5.2 million compared to $2.9 million for the fourth quarter of 2013.

FFO for the fourth quarter increased 20% to $8.0 million compared to $6.7 million for the fourth quarter of 2013. Core FFO for the fourth quarter increased 12% to $7.9 million compared to $7.1 million for the fourth quarter of 2013.

The quarter-over-quarter increases in net income, FFO and Core FFO reflect the Dimmock Square acquisition as well as higher occupancy and Same Store NOI in each of the Company’s operating property segments. The quarter-over-quarter increases in net income and FFO also reflect the positive initial performance of the development pipeline projects that the Company delivered in 2014. Net income for the fourth quarter also included a $2.2 million gain on the sale of the Virginia Natural Gas office building.

Financial results on a per diluted share basis for the fourth quarter of 2014 were affected by the Company’s underwritten public offering of 5.75 million shares of common stock in September 2014. Net income for the fourth quarter was $0.13 per diluted share compared to $0.09 per diluted share for the fourth quarter of 2013. FFO for the fourth quarter was $0.20 per diluted share compared to $0.21 per diluted share for the fourth quarter of 2013. Core FFO for the fourth quarter was $0.20 per diluted share compared to $0.22 per diluted share for the fourth quarter of 2013.

 

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February 12, 2015

Page 3 of 9

 

Operating Performance

The Company executed new and renewal office and retail leases totaling over 50,000 square feet in the fourth quarter. At the end of the quarter, the Company’s office, retail and multifamily operating property portfolios were 95.2%, 96.4% and 95.7% occupied, respectively.

Balance Sheet and Financing Activity

At the end of the fourth quarter, the Company had total outstanding debt of approximately $359.2 million, including $59.0 million outstanding on its existing revolving credit facility. Approximately 40% of the Company’s debt had fixed interest rates at December 31, 2014 and, after considering interest rate swaps and LIBOR interest rate caps with strike prices at or below 150 basis points, approximately 73% of the Company’s debt was fixed or hedged at December 31, 2014.

Outlook

The Company is introducing its 2015 full-year guidance. The Company expects 2015 Normalized FFO in the range of $0.85 to $0.90 per diluted share.

“We believed that Core FFO, which adjusted for the initial performance of our development pipeline projects, was a useful supplemental performance measure for 2014 because of the number of multifamily deliveries unique to that year,” said Mike O’Hara, Chief Financial Officer. “Going forward, rather than Core FFO, we will report Normalized FFO that will not adjust for our non-stabilized development pipeline activity and non-cash stock compensation but will exclude certain items, including debt extinguishment costs, property acquisition costs, mark-to-market adjustments for interest rate derivatives and other non-comparable items. Normalized FFO was $0.20 per diluted share for the fourth quarter and $0.82 per diluted share for the full-year 2014.”

 

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February 12, 2015

Page 4 of 9

 

The following table outlines the Company’s assumptions along with Normalized FFO per share estimates for the full-year 2015.

 

Full-year 2015 Guidance [1]

   Expected Ranges  

Total GAAP NOI [2]

   $ 52.3M       $ 53.3M   

Construction company annual segment gross profit

   $ 4.5M       $ 5.0M   

General and administrative expenses

   $ 8.3M       $ 8.6M   

Interest expense [3]

   $ 14.0M       $ 15.0M   

Normalized FFO per diluted share [4]

   $ 0.85       $ 0.90   

 

[1]  Includes the impact of two pending acquisitions scheduled to close by the end of the first quarter of 2015 but excludes the impact of any other future acquisitions, dispositions or other capital markets activity.
[2]  Includes in excess of $8.5 million from development pipeline projects.
[3]  The mid-point of the range reflects the assumption factors in the LIBOR yield curve which anticipates increasing LIBOR during the year.
[4]  Assumes 40.2 million weighted average shares and units outstanding.

Supplemental Financial Information

Further details regarding operating results, properties and leasing statistics can be found in the Company’s supplemental financial package available at www.ArmadaHoffler.com under the Investor Relations section.

Webcast and Conference Call

The Company will host a webcast and conference call on Thursday, February 12, 2015 at 8:30 a.m. Eastern Time to review quarterly results and discuss recent events. The live webcast will be available through the Investor Relations page of the Company’s website, www.ArmadaHoffler.com, or through www.viavid.com. To participate in the call, please dial 877-407-3982 (domestic) or 201-493-6780 (international). A replay of the conference call will be available through March 12, 2015, by dialing 877-870-5176 (domestic) or 858-384-5517 (international) and entering the pass code 13598676.

About Armada Hoffler Properties, Inc.

Armada Hoffler Properties, Inc. is a full service real estate company with extensive experience developing, building, owning and managing high-quality, institutional-grade office, retail and

 

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February 12, 2015

Page 5 of 9

 

multifamily properties in attractive markets throughout the Mid-Atlantic United States. The Company has elected to be taxed as a real estate investment trust (“REIT”) for U.S. federal income tax purposes.

Forward-Looking Statements

Certain matters within this press release are discussed using forward-looking language as specified in the Private Securities Litigation Reform Act of 1995, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statement. These forward-looking statements may include comments relating to the current and future performance of the Company’s operating property portfolio, the Company’s development pipeline, the Company’s construction and development business, including backlog and timing of deliveries, and financing activities, the new unsecured credit facility, as well as acquisitions most notably the two pending acquisitions in Maryland, dispositions and the Company’s financial outlook and expectations. For a description of factors that may cause the Company’s actual results or performance to differ from its forward-looking statements, please review the information under the heading “Risk Factors” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, and other documents filed by the Company with the Securities and Exchange Commission.

Non-GAAP Financial Measures

The Company calculates FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”). NAREIT defines FFO as net income (loss) (calculated in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, real estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures.

FFO is a supplemental non-GAAP financial measure. The Company uses FFO as a supplemental performance measure because it believes that FFO is beneficial to investors as a starting point in measuring the Company’s operational performance. Specifically, in excluding real estate related depreciation and amortization and gains and losses from property dispositions, which do not relate to or are not indicative of operating performance, FFO provides a performance measure that, when compared period-over-period, captures trends in occupancy rates, rental rates and operating costs. We also believe that, as a widely recognized measure of the performance of REITs, FFO will be used by investors as a basis to compare the Company’s operating performance with that of other REITs.

 

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February 12, 2015

Page 6 of 9

 

However, because FFO excludes depreciation and amortization and captures neither the changes in the value of the Company’s properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of the Company’s properties, all of which have real economic effects and could materially impact the Company’s results from operations, the utility of FFO as a measure of the Company’s performance is limited. In addition, other equity REITs may not calculate FFO in accordance with the NAREIT definition as the Company does, and, accordingly, the Company’s FFO may not be comparable to such other REITs’ FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of the Company’s performance.

Management also believes that the computation of FFO in accordance with NAREIT’s definition includes certain items that are not indicative of the results provided by the Company’s operating property portfolio and affect the comparability of the Company’s period-over-period performance. Accordingly, in 2014 the Company further adjusted FFO to arrive at Core FFO, which eliminated certain of these items, including, but not limited to, the impact of non-stabilized development pipeline projects and non-cash stock compensation expense.

Going forward, management believes that Normalized FFO is a more useful performance measure that will not adjust for the non-stabilized development pipeline impact or non-cash stock compensation but will exclude certain items, including but not limited to, debt extinguishment costs and prepayment penalties, property acquisition, development and other pursuit costs, mark-to-market adjustments for interest rate derivatives and other non-comparable items.

For reference, as an aid in understanding the Company’s computation of FFO, Core FFO and Normalized FFO, a reconciliation of net income calculated in accordance with GAAP to FFO, Normalized FFO and Core FFO has been included on page nine of this release.

 

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February 12, 2015

Page 7 of 9

 

ARMADA HOFFLER PROPERTIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands)

 

     December 31,  
     2014     2013  
     (Unaudited)        

Assets

    

Real estate investments:

    

Income producing property

   $ 513,918      $ 406,239   

Construction in progress

     81,082        56,737   

Accumulated depreciation

     (116,099     (105,228
  

 

 

   

 

 

 

Net real estate investments

  478,901      357,748   

Real estate investments held for sale

  8,538      —     

Cash and cash equivalents

  25,883      18,882   

Restricted cash

  4,224      2,160   

Accounts receivable, net

  20,548      18,272   

Construction receivables, including retentions

  19,432      12,633   

Construction costs and estimated earnings in excess of billings

  272      1,178   

Other assets

  33,108      24,409   
  

 

 

   

 

 

 

Total Assets

$ 590,906    $ 435,282   
  

 

 

   

 

 

 

Liabilities and Equity

Indebtedness

$ 359,229    $ 277,745   

Accounts payable and accrued liabilities

  8,358      6,463   

Construction payables, including retentions

  42,399      28,139   

Billings in excess of construction costs and estimated earnings

  1,053      1,541   

Other liabilities

  17,961      15,873   
  

 

 

   

 

 

 

Total Liabilities

  429,000      329,761   
  

 

 

   

 

 

 

Total Equity

  161,906      105,521   
  

 

 

   

 

 

 

Total Liabilities and Equity

$ 590,906    $ 435,282   
  

 

 

   

 

 

 

 

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February 12, 2015

Page 8 of 9

 

ARMADA HOFFLER PROPERTIES, INC. AND PREDECESSOR

CONDENSED CONSOLIDATED AND COMBINED INCOME STATEMENTS

(in thousands, except per share amounts)

 

     Three Months Ended
December 31,
    Year Ended
December 31,
 
     2014     2013     2014     2013  
     (Unaudited)     (Unaudited)        

Revenues

        

Rental revenues

   $ 17,521      $ 14,992      $ 64,746      $ 57,520   

General contracting and real estate services

     32,060        19,373        103,321        82,516   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

  49,581      34,365      168,067      140,036   
  

 

 

   

 

 

   

 

 

   

 

 

 

Expenses

Rental expenses

  4,437      3,557      16,667      14,025   

Real estate taxes

  1,512      1,347      5,743      5,124   

General contracting and real estate services

  30,947      17,945      98,754      78,813   

Depreciation and amortization

  4,976      3,786      17,569      14,898   

General and administrative

  1,943      1,725      7,711      6,937   

Acquisition, development and other pursuit costs

  55      —        229      —     

Impairment charges

  —        47      15      580   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

  43,870      28,407      146,688      120,377   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

  5,711      5,958      21,379      19,659   

Interest expense

  (2,671   (2,501   (10,648   (12,303

Loss on extinguishment of debt

  —        (135   —        (2,387

Gain on acquisitions and dispositions

  2,211      —        2,211      9,460   

Other (expense) income

  (90   (46   (113   297   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes

  5,161      3,276      12,829      14,726   

Income tax benefit (provision)

  65      (410   (70   (273
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

  5,226      2,866      12,759      14,453   

Net income attributable to Predecessor

  —        —        —        (2,020
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income attributable to stockholders and unitholders

$ 5,226    $ 2,866    $ 12,759    $ 12,433   
  

 

 

   

 

 

   

 

 

   

 

 

 

Per Share:

Basic and Diluted

$ 0.13    $ 0.09    $ 0.36    $ 0.39   

Weighted Average Common Shares and Units:

Basic and Diluted

  39,796      32,223      35,071      32,105   

 

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ARMADA HOFFLER PROPERTIES, INC.

RECONCILIATION OF NET INCOME TO FFO, NORMALIZED FFO & CORE FFO

(in thousands, except per share amounts)

 

     Three Months Ended
December 31,
    Year Ended
December 31,
2014
 
     2014     2013    
     (Unaudited)     (Unaudited)  

Net income

   $ 5,226      $ 2,866      $ 12,759   

Depreciation and amortization

     4,976        3,786        17,569   

Gain on dispositions

     (2,211     —          (2,211
  

 

 

   

 

 

   

 

 

 

Funds From Operations (FFO)

$ 7,991    $ 6,652    $ 28,117   

Acquisition costs

  55      —        229   

Loss on extinguishment of debt

  —        135      —     

Loan modification costs

  —        27      —     

Impairment charges

  —        47      15   

Derivative mark-to-market adjustments

  110      53      233   
  

 

 

   

 

 

   

 

 

 

Normalized FFO

$ 8,156    $ 6,914    $ 28,594   

Derivative mark-to-market adjustments

  (110   (53   (233

Non-cash stock compensation

  197      237      917   

Non-stabilized development projects

  (305   —        79   
  

 

 

   

 

 

   

 

 

 

Core FFO

$ 7,938    $ 7,098    $ 29,357   
  

 

 

   

 

 

   

 

 

 

FFO per diluted share

$ 0.20    $ 0.21    $ 0.80   
  

 

 

   

 

 

   

 

 

 

Normalized FFO per diluted share

$ 0.20    $ 0.21    $ 0.82   
  

 

 

   

 

 

   

 

 

 

Core FFO per diluted share

$ 0.20    $ 0.22    $ 0.84   
  

 

 

   

 

 

   

 

 

 

Common Shares and Units Outstanding

  39,796      32,223      35,071   

Contact:

Julie Loftus Trudell

Armada Hoffler Properties, Inc.

Vice President of Investor Relations

Email: JTrudell@ArmadaHoffler.com

Phone: (757) 366-6692

###

EX-99.2
Armada Hoffler Properties, Inc.
Fourth Quarter 2014 Supplemental Information
1
Exhibit 99.2


Table of Contents
2
Forward Looking Statements
3
Corporate Profile
4
Quarter Results and Financial Summary
5
Highlights
6
2015 Outlook
7
Summary Information
8
Summary Balance Sheet
9
Summary Income Statement
10
Normalized FFO, Core FFO & AFFO
11
Summary of Outstanding Debt
12
Core Debt to Core EBITDA
13
Debt Information
14
Portfolio Summary & Business Segment Overview
15
Stabilized Portfolio Summary
16
Stabilized Portfolio Summary Footnotes
17
Development Pipeline
18
Acquisitions & Dispositions
19
Construction Business Summary
20
Operating Results & Property-Type Segment Analysis
21
Same Store NOI by Segment
22
Top 10 Tenants by Annual Base Rent
23
Office Lease Summary
24
Retail Lease Summary
26
Historical Occupancy
28
Net Asset Value Component Data
31
Appendix - Definitions & Reconciliations
32
Definitions
33
Reconciliations
38


Forward Looking Statements
3
This
Supplemental
Information
should
be
read
in
conjunction
with
our
Annual
Report
on
Form
10-K
for
the
year ended December 31, 2014, and the unaudited consolidated financial statements appearing in our
press release dated February 12, 2015, which has been furnished as Exhibit 99.1 to our Form 8-K filed on
February
12,
2015.
The
Company
makes
statements
in
this
Supplemental
Information
that
are
forward-
looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in
Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the
Securities
Exchange
Act
of
1934,
as
amended
(the
“Exchange
Act”)).
In
particular,
statements
pertaining
to our capital resources, portfolio performance and results of operations contain forward-looking
statements.  Likewise, all of our statements regarding anticipated growth in our funds from operations,
normalized funds from operations, core funds from operations, adjusted funds from operations, funds
available for distribution and net operating income are forward-looking statements.  You can identify
forward-looking statements by the use of forward-looking terminology such as “believes,”
“expects,”
“may,”
“will,”
“should,”
“seeks,”
“approximately,”
“intends,”
“plans,”
“estimates”
or “anticipates”
or
the negative of these words and phrases or similar words or phrases which are predictions of or indicate
future events or trends and which do not relate solely to historical matters. You can also identify forward-
looking statements by discussions of strategy, plans or intentions.
Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as
predictions of future events. Forward-looking statements depend on assumptions, data or methods which
may
be
incorrect
or
imprecise
and
the
Company
may
not
be
able
to
realize
them.
The
Company
does
not
guarantee
that
the
transactions
and
events
described
will
happen
as
described
(or
that
they
will
happen
at all).  For further discussion of risk factors and other events that could impact our future results, please
refer to the section entitled “Risk Factors”
in our most recent Annual Report on Form 10-K filed with the
Securities and Exchange Commission (the “SEC”), and the documents subsequently filed by us from time
to time with the SEC.


Corporate Profile
4
Corporate Information
Management & Board
Board of Directors
Corporate Officers
Daniel A. Hoffler
Executive Chairman of the Board
Louis S. Haddad
President and Chief Executive Officer
A. Russell Kirk
Vice Chairman of the Board
Anthony P. Nero
President of Development
Louis S. Haddad
Director
Shelly R. Hampton
President of Asset Management
John W. Snow
Lead Independent Director
Eric E. Apperson
President of Construction
George F. Allen
Independent Director
Michael P. O’Hara
Chief Financial Officer and Treasurer
James A. Carroll
Independent Director
Eric L. Smith
Vice President of Operations and Corporate Secretary
James C. Cherry
Independent Director
Joseph W. Prueher
Independent Director
Analyst Coverage
Raymond James & Associates
Robert W. Baird & Co.
Stifel, Nicolaus & Company, Inc.
Wunderlich Securities
Bill Crow
David Rodgers
John Guinee
Craig Kucera
(727) 567-2594
(216) 737-7341
(443) 224-1307
(540) 277-3366
bill.crow@raymondjames.com
drodgers@rwbaird.com
jwguinee@stifel.com
ckucera@wundernet.com
Investor Relations Contact
Julie Loftus Trudell
Vice President of Investor Relations
(757) 366-6692
jtrudell@armadahoffler.com
Armada Hoffler Properties, Inc. (NYSE: AHH)
is a full service real estate company that develops, constructs, and owns institutional grade office, retail, and
multifamily properties in the Mid-Atlantic United States.  The Company also provides general contracting and development services to third-party clients
throughout the Mid-Atlantic and Southeastern regions.  Armada Hoffler Properties, Inc. was founded in 1979 and is headquartered in Virginia Beach, VA.  The
Company has elected to be taxed as a real estate investment trust (REIT) for U.S. federal income tax purposes.


Fourth Quarter Results and
Financial Summary


Highlights
Funds From Operations (“FFO”) of $8.0 million, or $0.20 per diluted share, for the quarter ended December 31, 2014. 
FFO of $28.1 million, or $0.80 per diluted share, for the full-year 2014.
Core FFO of $7.9 million, or $0.20 per diluted share, for the quarter ended December 31, 2014.  Core FFO of $29.4
million, or $0.84 per diluted share, for the full-year 2014.
Occupancy up to 95.7%, compared to 95.1 % as of September 30, 2014 and 94.4% as of December 31, 2013.
Increased quarterly GAAP and Cash Same Store Net Operating Income (“NOI”) 2.9% and 3.0%, respectively, compared to
the fourth quarter of 2013.
Increased annual GAAP and Cash Same Store NOI 2.0% and 0.7%, respectively, compared to the full-year 2013.
In the fourth quarter, completed the sale of the Virginia Natural Gas office building for approximately $8.9 million,
representing a cap rate of 6.25%.
In January 2015, completed the sale of the Sentara Williamsburg office building for approximately $15.4 million,
representing a cap rate of 6.3%.
Entered into agreements to acquire two grocery anchored retail centers located in Maryland.
These pending
acquisitions will add over 185,000 square feet to the Company’s portfolio with a combined occupancy of approximately
90%.
The Company intends to acquire 100% interests in these centers in exchange for a combination of common stock
and cash including the net proceeds from the Sentara Williamsburg sale.  These acquisitions are expected to be
accretive to 2015 FFO per diluted share and are expected to close by the end of the first quarter of 2015.
Both
transactions are subject to customary closing conditions.
Entered into a commitment with a syndicate of banks co-led by Bank of America and Regions Bank for a new, expanded
and unsecured $200 million senior credit facility that includes a $50 million term loan.
Declared a cash dividend of $0.17 per common share for the first
quarter of 2015, representing a 6.3% increase over the
prior quarter’s cash dividend.  The first quarter dividend will be payable on April 9, 2015 to stockholders of record on
April 1, 2015.
Introduces 2015 Normalized FFO guidance in the range of $0.85 to
$0.90 per diluted share. 
6


2015 Outlook
7
Full-year 2015 Guidance
Total GAAP NOI
$52.3M
$53.3M
Construction company annual segment gross profit
$4.5M
$5.0M
General and administrative expenses
$8.3M
$8.6M
Interest expense
$14.0M
$15.0M
Normalized FFO per diluted share
$0.85
$0.90
Expected Ranges


Summary Information
8
$ in thousands, except per share
Market Capitalization
Key Financials
12/31/2014
Financial Information:
12/31/2014
% of Total
Equity
Total Market
Capitalization
Rental revenues
$17,521
Market Data
General contracting and real estate services revenues
32,060
                       
Total Common Shares Outstanding
63%
25,023
                       
Rental properties Net Operating Income (NOI)
11,572
                       
Operating Partnership ("OP") Units Outstanding
37%
14,776
                       
General contracting and real estate services gross profit
1,113
                          
Common shares and OP units outstanding
100%
39,799
                       
Net income
5,226
                          
Market price per common share
$9.49
Funds From Operations (FFO)
7,991
                          
Equity market capitalization
$377,689
FFO per diluted share
$0.20
Total debt
359,229
                     
Normalized FFO
8,156
                          
Total market capitalization
$736,918
Normalized FFO per diluted share
$0.20
Less: cash
(30,107)
                      
Core FFO
7,938
                          
Total enterprise value
$706,811
Core FFO per diluted share
$0.20
Weighted Average Shares/Units Outstanding
39,796
                       
Stable Portfolio Metrics
Debt Metrics
12/31/2014
Rentable square feet or number of units:
12/31/2014
Office
(1)
918,162
                     
Key Metrics
Retail
(2)
1,200,738
                  
Core debt/enterprise value
34.6%
Multifamily
(3)
626
                             
Fixed charge coverage ratio:
EBITDA
(7)
$10,597
Occupancy:
Interest
2,671
                          
Office
(4)
95.2%
Principal
800
                             
Retail
(4)
96.4%
Total Fixed Charges
3,471
                          
Multifamily
(5)
95.7%
Fixed charge coverage ratio
3.05x
Weighted Average
(6)
95.7%
Core Debt/Annualized Core EBITDA
6.1x
Three months ended
Three months ended
(1) Excludes 4525 Main Street
(2) Excludes Greentree Shopping Center
(3) Excludes Liberty, Encore, and Whetstone Apartments
(4) Office
and
retail
occupancy
based
on
leased
square
feet
as
a
%
of
respective
total
(5) Multifamily occupancy based on occupied units as a % of respective total
(6) Total occupancy weighted by annualized base rent
(7) Excludes $2.2M gain on disposition


Summary Balance Sheet
9
$ in thousands
12/31/2014
12/31/2013
Assets
(Unaudited)
Real estate investments:
Income producing property
$513,918
$406,239
Construction in progress
81,082
             
56,737
             
Accumulated depreciation
(116,099)
          
(105,228)
          
Net real estate investments
478,901
           
357,748
           
Real estate investments held-for-sale
8,538
                 
-
                     
Cash and cash equivalents
25,883
             
18,882
             
Restricted cash
4,224
                 
2,160
                 
Accounts receivable, net
20,548
             
18,272
             
Construction receivables, including retentions
19,432
             
12,633
             
Costs and estimated earnings in excess of billings
272
                    
1,178
                 
Other assets
33,108
             
24,409
             
Total Assets
$590,906
$435,282
Liabilities and Equity
Indebtedness
$359,229
$277,745
Accounts payable and accrued liabilities
8,358
                 
6,463
                 
Construction payables, including retentions
42,399
             
28,139
             
Billings in excess of costs and estimated earnings
1,053
                 
1,541
                 
Other liabilities
17,961
             
15,873
             
Total Liabilities
429,000
           
329,761
           
Total Equity
161,906
           
105,521
           
Total Liabilities and Equity
$590,906
$435,282
As of


Summary Income Statement 
10
$ in thousands


Normalized FFO, Core FFO & AFFO
11
$ in thousands, except per share
(1) Excludes tenant improvements and leasing commissions on first generation rental space.
Three months ended
Year ended
12/31/2014
12/31/2014
(Unaudited)
Net income
$5,226
$12,759
Depreciation and amortization
4,976
17,569
Gain on acquisitions
(2,211)
(2,211)
FFO
7,991
28,117
FFO per weighted average share
$0.20
$0.80
Normalized FFO
Acquisition costs
55
229
Loss on extinguishment of debt
-
-
Impairment charges
-
15
Derivative (income) losses
110
233
Normalized FFO
8,156
28,594
Normalized FFO per weighted average share
$0.20
$0.82
Core FFO
Derivative income (losses)
(110)
(233)
Non-cash stock compensation
197
917
Non-stabilized development pipeline adjustments
(305)
79
Core FFO
7,938
29,357
Core FFO per weighted average share
$0.20
$0.84
AFFO
Non-Stabilized development pipeline adjustments
305
(79)
Acquisition costs
(55)
(229)
Tenant improvements, leasing commissions
(3,114)
(5,311)
Leasing incentives
(334)
(462)
Property related capital expenditures
(583)
(1,479)
Non cash interest expense
104
514
GAAP Adjustments
Net effect of straight-line rents
(394)
(1,887)
Amortization of lease incentives and above (below) market rents
172
633
Derivative (income) losses
110
233
Government development grants
-
300
AFFO
4,149
21,590
AFFO per weighted average share
$0.10
$0.62
(1)


Summary of Outstanding Debt
12
$ in thousands
(1) LIBOR rate is determined by individual lenders.
(2) Subject to an interest rate swap lock.
(3) Principal balance excluding any fair value
      adjustment recognized upon acquisition.
(4) Excludes fair value adjustment
Weighted Average Fixed Interest Rate
5.3%
Weighted Average Variable Interest Rate
2.1%
Total Weighted Average Interest Rate
(4)
3.4%
Variable Interest Rate as a % of Total (excluding interest rate caps)
(4)
59.7%
Weighted Average Maturity (years)
(4)
8.3
Debt
Amount
Outstanding
Interest Rate
(1)
Effective Rate as of
December 31, 2014
Maturity Date
Balance at
Maturity
Virginia Beach Town Center
249 Central Park Retail
$15,566
5.99%
September 8, 2016
$15,084
South Retail
6,867
                      
5.99%
September 8, 2016
6,655
                      
Studio 56 Retail
2,618
                      
3.75%
May 7, 2015
2,592
                      
Commerce Street Retail
5,549
                      
LIBOR +2.25%
2.40%
October 31, 2018
5,264
                      
Fountain Plaza Retail
7,783
                      
5.99%
September 8, 2016
7,542
                      
Dick's at Town Center
8,216
                      
LIBOR+2.75%
2.90%
October 31, 2017
7,889
                      
The Cosmopolitan
47,132
                    
3.75%
July 1, 2051
-
                          
Diversified Portfolio
Oyster Point
6,274
                      
5.41%
December 1, 2015
6,089
                      
Broad Creek Shopping Center
   Note 1
4,452
                      
LIBOR +2.25%
2.40%
October 31, 2018
4,223
                      
   Note 2
8,173
                      
LIBOR +2.25%
2.40%
October 31, 2018
7,752
                      
   Note 3
3,422
                      
LIBOR +2.25%
2.40%
October 31, 2018
3,246
                      
Hanbury Village
   Note 1
21,218
                    
6.67%
October 11, 2017
20,499
                    
   Note 2
4,090
                      
LIBOR +2.25%
2.40%
October 31, 2018
3,777
                      
Harrisonburg Regal
3,659
                      
6.06%
June 8, 2017
3,165
                      
North Point Center
   Note 1
10,149
                    
6.45%
February 5, 2019
9,333
                      
   Note 2
2,753
                      
7.25%
September 15, 2025
1,344
                      
   Note 5
685
                         
LIBOR+2.00%
3.57%
(2)
February 1, 2017
641
                         
Tyre Neck Harris Teeter
2,437
                      
LIBOR +2.25%
2.40%
October 31, 2018
2,235
                      
Smith's Landing
24,470
                    
LIBOR+2.15%
2.30%
January 31, 2017
23,793
                    
185,513
                 
131,123
                 
Credit Facility
59,000
                    
LIBOR + 1.60% - 2.20%
1.90%
May 13, 2016
59,000
                    
Total including Credit Facility
$244,513
$190,123
Development Pipeline
4525 Main Street
$30,870
LIBOR+1.95%
2.10%
January 30, 2017
30,870
                    
Encore Apartments
22,215
                    
LIBOR+1.95%
2.10%
January 30, 2017
22,215
                    
Whetstone Apartments
16,019
                    
LIBOR+1.90%
2.05%
October 8, 2016
16,019
                    
Sandbridge Commons
5,892
                      
LIBOR+1.85%
2.00%
January 17, 2018
5,892
                      
Liberty Apartments
20,603
                    
(3)
5.66%
November 1, 2043
-
                          
Oceaneering
13,490
                    
LIBOR+1.75%
1.90%
February 28, 2018
13,490
                    
Commonwealth of Virginia - Chesapeake
3,585
                      
LIBOR+1.90%
2.05%
August 28, 2017
3,585
                      
Lightfoot Marketplace
3,484
                      
LIBOR+1.90%
2.05%
November 14, 2017
3,484
                      
Total Notes Payable - Development Pipeline
116,158
                 
95,555
                    
Unamortized fair value adjustments
(1,442)
                     
-
                          
Total Notes Payable
$359,229
$285,678
4Q 2014
Year to Date
Capitalized Interest
$794
$2,752


Core Debt to Core EBITDA
13
Three months ended
12/31/2014
12/31/2014
(Unaudited)
(Unaudited)
Net Income
$5,226
Total Debt
$359,229
Excluding:
Excluding:
Interest Expense
2,671
                            
Development Pipeline Unstabilized Debt
(114,716)
               
Income Tax
(65)
                                
Depreciation and amortization
4,976
                            
Core Debt
$244,513
EBITDA
12,808
                         
Additional Adjustments:
Gain on dispositions
(2,211)
                          
Early extinguishment of debt
-
                                
Core Debt/Annualized Core EBITDA
6.1x
Derivative (income) losses
110
                               
Non-cash stock compensation
197
                               
Development Pipeline
(802)
                              
Total Other Adjustments
(2,706)
                          
Core EBITDA
$10,102
Annualized Core EBITDA
$40,408
$ in thousands


Debt Information
14
$ in thousands
Interest Rate Cap Agreements At or Below 1.50%
Effective Date
Maturity Date
Strike Rate
Notional Amount
May 31, 2012
May 29, 2015
1.09%
$8,888
September 1, 2013
March 1, 2016
1.50%
40,000
                   
October 4, 2013
April 1, 2016
1.50%
18,500
                   
March 14, 2014
March 1, 2017
1.25%
50,000
                   
Total Interest Rate Caps at or Below 1.50%
$117,388
Fixed Debt Outstanding (excludes fair value adjustment)
145,307
               
Total Fixed Interest Rate Debt (including caps)
$262,695
Fixed Interest Rate Debt as a % of Total
73%
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
2015
2017
2019 and
thereafter
Debt Maturity as of
12/31/2014
2016
2018


Portfolio Summary & Business
Segment Overview


Stabilized Portfolio Summary
16
As of 12/31/14
Property
Location
Year Built
Net Rentable
Square Feet
(1)
Occupied Sq. Ft.
% Leased
(2)
Annualized
Base Rent
(3)
Annualized
Base Rent per
Leased Sq. Ft.
(3)
Average Net
Effective
Annual Base
Rent per
Leased Sq. Ft.
(4)
Office Properties
Armada Hoffler Tower
(5)
Virginia Beach, VA
2002
323,966
312,415
96.4%
$8,320,174
$26.63
$27.46
One Columbus
Virginia Beach, VA
1984
129,424
129,424
100.0%
3,018,331
23.32
23.34
Two Columbus
Virginia Beach, VA
2009
108,464
98,938
91.2%
2,528,923
25.56
25.75
Richmond Tower
Richmond, VA
2010
206,969
204,083
98.6%
7,569,747
37.09
41.81
Oyster Point
Newport News, VA
1989
100,139
80,128
80.0%
1,767,387
22.06
21.12
Sentara Williamsburg
(6)
Williamsburg, VA
2008
49,200
49,200
100.0%
1,006,140
20.45
20.50
Subtotal / Weighted Average Office Portfolio
(7)
918,162
874,188
95.2%
$24,210,702
$27.70
$29.04
Retail Properties Not Subject to Ground Lease
Bermuda Crossroads
Chester, VA
2001
111,566
109,966
98.6%
1,522,001
13.84
14.03
Broad Creek Shopping Center
Norfolk, VA
1997-2001
227,691
221,576
97.3%
3,091,636
13.95
12.66
Courthouse 7-Eleven
Virginia Beach, VA
2011
3,177
3,177
100.0%
125,000
39.35
43.81
Gainsborough Square
Chesapeake, VA
1999
88,862
85,782
96.5%
1,346,126
15.69
15.16
Hanbury Village
Chesapeake, VA
2006-2009
61,049
52,716
86.4%
1,278,659
24.26
24.46
North Point Center
Durham, NC
1998-2009
215,690
200,890
93.1%
2,383,713
11.87
11.91
Parkway Marketplace
Virginia Beach, VA
1998
37,804
37,804
100.0%
737,456
19.51
19.44
Harrisonburg Regal
Harrisonburg, VA
1999
49,000
49,000
100.0%
683,550
13.95
13.95
Dick's at Town Center
Virginia Beach, VA
2002
103,335
103,335
100.0%
1,179,866
11.42
11.72
249 Central Park Retail
(8)
Virginia Beach, VA
2004
91,171
83,481
91.6%
2,424,086
29.04
28.29
Studio 56 Retail
Virginia Beach, VA
2007
11,600
9,832
84.8%
371,200
37.75
37.58
Commerce Street Retail
(9)
Virginia Beach, VA
2008
19,173
19,173
100.0%
781,588
40.77
37.06
Fountain Plaza Retail
Virginia Beach, VA
2004
35,961
35,961
100.0%
970,230
26.98
26.79
South Retail
Virginia Beach, VA
2002
38,493
38,493
100.0%
921,559
23.94
24.31
Dimmock Square
Colonial Heights, VA
1998
106,166
106,166
100.0%
1,769,435
16.67
16.76
Subtotal / Weighted Avg Retail Portfolio not Subject to Ground Leases
(10)
1,200,738
1,157,352
96.4%
$19,586,105
$16.92
$16.61
Retail Properties Subject to Ground Lease
Bermuda Crossroads
(11)
Chester, VA
2001
(13)
100.0%
163,350
Broad Creek Shopping Center
(12)
Norfolk, VA
1997-2001
(14)
100.0%
588,126
Hanbury Village
(11)
Chesapeake, VA
2006-2009
(15)
100.0%
1,067,598
North Point Center
(11)
Durham, NC
1998-2009
(16)
100.0%
1,062,784
Tyre Neck Harris Teeter
(12)
Portsmouth, VA
2011
(17)
100.0%
508,134
Subtotal / Weighted Avg Retail Portfolio Subject to Ground Leases
100.0%
$3,389,992
Total / Weighted Avg Retail Portfolio
1,200,738
(18)
1,157,352
96.4%
$22,976,097
$16.92
$16.61
Total / Weighted Average Retail and Office Portfolio
2,118,900
2,031,540
95.9%
$47,186,799
$21.56
$21.95
Property
Location
Year Built
Units
(19)
% Leased
(2)
Annualized
Base Rent
(20)
Average
Monthly Base
Rent per
Leased Unit
(21)
Multifamily
Smith's Landing
(22)
Blacksburg, VA
2009
284
97.9%
$3,472,020
$1,040.77
The Cosmopolitan
Virginia Beach, VA
2006
342
93.9%
6,937,078
1,571.26
Total / Weighted Avg Multifamily Portfolio
626
95.7%
$10,409,098
$1,325.06


Stabilized Portfolio Summary Footnotes
17
1)
The net rentable square footage for each of our office properties is the sum of (a) the square footages of existing leases, plus (b) for available space, management’s estimate of net rentable square footage
based, in part, on past leases. The net rentable square footage included in office leases is generally determined consistently with the Building Owners and Managers Association, or BOMA, 1996
measurement guidelines. The net rentable square footage for each of our retail properties is the sum of (a) the square footages of existing leases, plus (b) for available space, the field verified square
footage.
2)
Percentage leased for each of our office and retail properties is calculated as (a) square footage under executed leases as of December 31, 2014, divided by (b) net rentable square feet, expressed as a
percentage. Percentage leased for our multifamily properties is calculated as (a) total units occupied as of December 31, 2014, divided by (b) total units available, expressed as a percentage.
3)
For the properties in our office and retail portfolios, annualized base rent is calculated by multiplying (a) base rental payments for executed leases as of December 31, 2014 (defined as cash base rents
(before abatements) excluding tenant reimbursements for expenses paid by the landlord), by (b) 12. Annualized base rent per leased square foot is calculated by dividing (a) annualized base rent, by (b)
square footage under commenced leases as of December 31, 2014. In the case of triple net or modified gross leases, annualized base rent does not include tenant reimbursements for real estate taxes,
insurance, common area or other operating expenses.
4)
Average net effective annual base rent per leased square foot represents (a) the contractual base rent for leases in place as of December 31, 2014, calculated on a straight-line basis to amortize free rent
periods and abatements, but without regard to tenant improvement allowances and leasing commissions, divided by (b) square footage under commenced leases as of December 31, 2014.
5)
As of December 31,2014, the Company occupied 18,984 square feet at this property at an annualized base rent of $529,746 or $27.90 per leased square foot, which amounts are reflected in the % leased,
annualized base rent and annualized base rent per square foot columns in the table above. The rent paid by us is eliminated from our revenues in consolidation. In addition, effective March 1, 2013, the
Company sublease approximately 5,000 square feet of space from a tenant at this property.
6)
This property is subject to a triple net lease pursuant to which the tenant pays operating expenses, insurance and real estate taxes.
7)
Includes square footage and annualized base rent pursuant to leases for space occupied by us.
8)
As of December 31, 2014, the Company occupied 8,995 square feet at this property at an annualized base rent of $287,300, or $31.94 per leased square foot, which amounts are reflected in the % leased,
annualized base rent and annualized base rent per square foot columns in the table above. The rent paid by us is eliminated from our revenues in consolidation.
9)
Includes $32,460 of annualized base rent pursuant to a rooftop lease.
10)
Reflects square footage and annualized base rent pursuant to leases for space occupied by AHH.
11)
For this ground lease, the Company own the land and the tenant owns the improvements thereto.  The Company will succeed to the ownership of the improvements to the land upon the termination of
the ground lease.
12)
The Company lease the land underlying this property from the owner of the land pursuant to a ground lease. The Company re-lease the land to our tenant under a separate ground lease pursuant to which
our tenant owns the improvements on the land.
13)
Tenants collectively lease approximately 139,356 square feet of land from us pursuant to ground leases.
14)
Tenants collectively lease approximately 299,170 square feet of land from us pursuant to ground leases.
15)
Tenants collectively lease approximately 105,988 square feet of land from us pursuant to ground leases.
16)
Tenants collectively lease approximately 1,443,985 square feet of land from us pursuant to ground leases.
17)
Tenant leases approximately 200,073 square feet of land from us pursuant to a ground lease.
18)
The total square footage of our retail portfolio excludes the square footage of land subject to ground leases.
19)
Units represent the total number of apartment units available for rent at December 31, 2014.
20)
For the properties in our multifamily portfolio, annualized base rent is calculated by multiplying (a) base rental payments for the month ended December 31, 2014 by (b) 12.
21)
Average monthly base rent per leased unit represents the average monthly rent for all leased units for the month ended December 31, 2014.
22)
The Company lease the land underlying this property from the owner of the land pursuant to a ground lease.
23)
The annualized base rent for The Cosmopolitan includes $885,000 of annualized rent from 15 retail leases at the property.


Development Pipeline
18
$ in thousands
(1)  Represents estimates that may change as the development process proceeds
(2)  Estimated square footage includes land subject to ground lease and will be excluded from the portfolio square footage upon stabilization.
(3)  AHH earns a preferred return on equity prior to any distributions to JV partners
(4)  This property is located within the Virginia Beach Town Center
(5)  Approximately 83,000 square feet is leased to Clark Nexsen, an architectural firm and  
       approximately 23,000 square feet is leased to the Development Authority of Virginia Beach
Schedule
(1)
Development, Not Delivered
Location
Estimated
(1)
Estimated
Cost
(1)
Cost Incurred
through
12/31/2014
Start
Initial
Occupancy
Stabilized
Operation
AHH
Ownership %
Property Type
%leased
Anchor Tenants
Oceaneering
Chesapeake, VA
155,000 sf
$26,000
$22,000
4Q13
1Q15
1Q15
100%
Office
100%
Oceaneering
Sandbridge Commons
Virginia Beach, VA
70,000 sf
(2)
13,000
9,000
4Q13
1Q15
4Q15
100%
Retail
86%
Harris Teeter
Commonwealth of VA -
Chesapeake
Chesapeake, VA
36,000 sf
7,000
7,000
2Q14
1Q15
1Q15
100%
Office
100%
Commonwealth of Virginia
Commonwealth of VA -
Virginia Beach
Virginia Beach, VA
11,000 sf
3,000
3,000
2Q14
1Q15
1Q15
100%
Office
100%
Commonwealth of Virginia
Lightfoot Marketplace
Williamsburg, VA
88,000 sf
(2)
24,000
11,000
3Q14
1Q16
2Q17
60%
(3)
Retail
60%
Harris Teeter
Johns Hopkins Village
Baltimore, MD
157 units
65,000
2,000
1Q15
3Q16
4Q16
80%
Multifamily
NA
NA
138,000
54,000
Schedule
(1)
Development, Delivered Not Stabilized
Location
Estimated
(1)
Estimated
Cost
(1)
Cost Incurred
through
12/31/2014
Start
Initial
Occupancy
Stabilized
Operation
AHH
Ownership %
(1)
Property Type
%leased
Anchor Tenants
4525 Main Street
(4)
Virginia Beach, VA
239,000 sf
(3)
$50,000
$44,000
1Q13
3Q14
1Q16
100%
Office
56%
(5)
Clark Nexsen, Development Authority
of Virginia Beach
, Anthropologie
Greentree Shopping Center
Chesapeake, VA
18,000 sf
(2)
6,000
5,000
4Q13
3Q14
3Q15
100%
Retail
73%
Wawa
Encore Apartments
(4)
Virginia Beach, VA
286 units
34,000
31,000
1Q13
3Q14
4Q15
100%
Multifamily
NA
NA
Whetstone Apartments
Durham, NC
203 units
29,000
27,000
2Q13
3Q14
4Q15
100%
Multifamily
NA
NA
119,000
107,000
Schedule
Re-Development
Location
Estimated
Estimated Cost
Cost Incurred
through
12/31/2014
Start
Complete
Property Type
%leased
Anchor Tenants
Dick's at Town Center
Virginia Beach, VA
20,000 sf
$2,000
$2,000
1Q14
4Q14
Retail
100%
USI
Total
$259,000
$163,000


Acquisitions & Dispositions
19
$ in thousands
(1)  Closed on 1/5/2015
Estimated
Pending Acquisitions
Location
Approximately
Purchase Price
Purchase Date
AHH
Ownership %
Property Type
%leased
Anchor Tenants
2 Grocery Anchor Shopping Centers
MD
185,000 sf
$39,500
1Q15
100%
Retail
90%
Grocery
Dispositions
Location
Approximately
Sale Price
Disposition
Date
AHH
Ownership %
Property Type
%leased
Anchor Tenants
Sentara Williamsburg
Williamsburg, VA
49,200 sf
$15,450
1Q15
(1)
100%
Office
100%
Sentara


Construction Business Summary
20
$ in thousands
Gross Profit Summary
Q4 2014
YTD 2014
(Unaudited)
Revenue
$32,060
$103,321
Expense
(30,947)
(98,754)
             
Gross Profit
$1,113
$4,567
Location
Total Contract
Value
Work in Place as
of 12/31/2014
Backlog
Estimated Date
of Completion
Projects Greater than $5.0M
Exelon
Baltimore, MD
$168,764
$42,785
$125,979
1Q 2016
City of Suffolk Municipal Center
Suffolk, VA
25,375
               
23,221
               
2,154
                  
2Q 2015
Four Seasons Condominium Expansion
Baltimore, MD
24,053
               
3,073
                  
20,980
               
4Q 2015
Sub Total
218,192
            
69,079
               
149,113
            
Projects Less than $5.0M
144,666
            
134,640
            
10,026
               
Total
$362,858
$203,719
$159,139


Operating Results & Property-
Type Segment Analysis


Same Store NOI by Segment
22
(Reconciliation to GAAP located in appendix pg. 38)
$ in thousands
Three months ended 12/31
Year ended 12/31
2014
2013
$ Change
% Change
2014
2013
$ Change
% Change
Office
(1)
(Unaudited)
(Unaudited)
Revenue
$6,499
$6,353
$146
2%
$25,640
$25,117
$523
2%
Expenses
2,036
1,903
133
7%
8,208
7,816
392
5%
Net Operating Income
4,463
4,450
13
0%
17,432
17,301
131
1%
Retail
(1)
Revenue
5,780
5,684
96
2%
20,874
20,474
400
2%
Expenses
1,712
1,725
(13)
-1%
6,487
6,525
(38)
-1%
Net Operating Income
4,068
3,959
109
3%
14,387
13,949
438
3%
Multifamily
(1)
Revenue
2,974
2,784
190
7%
7,758
7,494
264
4%
Expenses
1,277
1,254
23
2%
3,555
3,441
114
3%
Net Operating Income
1,697
1,530
167
11%
4,203
4,053
150
4%
Same Store Net Operating Income (NOI), GAAP basis
$10,228
$9,939
$289
3%
$36,022
$35,303
$719
2%
Net effect of straight-line rents
(198)
(187)
(11)
6%
(1,022)
(571)
(451)
79%
Amortization of lease incentives and above (below) market rents
159
142
17
12%
716
738
(22)
-3%
Same store portfolio NOI, cash basis
$10,189
$9,894
$295
3%
$35,716
$35,470
$246
1%
Cash Basis:
Office
$4,232
$4,131
$101
2%
$16,075
$16,257
($182)
-1%
Retail
4,229
4,205
24
1%
15,422
15,140
282
2%
Multifamily
1,728
1,558
170
11%
4,219
4,073
146
4%
$10,189
$9,894
$295
3%
$35,716
$35,470
$246
1%
GAAP Basis:
Office
$4,463
$4,450
$13
0%
$17,432
$17,301
$131
1%
Retail
4,068
3,959
109
3%
14,387
13,949
438
3%
Multifamily
1,697
1,530
167
11%
4,203
4,053
150
4%
$10,228
$9,939
$289
3%
$36,022
$35,303
$719
2%
(1)  See page 37 for Same Store vs. Non - Same Store Properties


Top 10 Tenants by Annual Base Rent
23
As of December 31, 2014
Office
Tenant
Number
of Leases
Number
of
Properties
Properties
Lease
Expiration
Annualized
Base Rent
% of Office
Portfolio
Annualized
Base Rent
% of Total
Portfolio
Annualized
Base Rent
Williams Mullen
3
2
Armada Hoffler Tower, Richmond Tower
3/22/2026
$7,978,920
33.0%
13.9%
Clark Nexsen
1
1
4525 Main Street
9/30/2029
2,390,656
9.9%
4.2%
Sentara Medical Group
1
1
Sentara Williamsburg
(1)
3/31/2023
1,006,140
4.2%
1.7%
Cherry Bekaert
3
3
Armada Hoffler Tower, Richmond Tower, Oyster Point
1/31/2025
958,984
4.0%
1.7%
Hampton University
2
1
Armada Hoffler Tower
2/28/2023
891,087
3.7%
1.5%
GSA
1
1
Oyster Point
4/26/2017
856,448
3.5%
1.5%
Troutman Sanders
1
1
Armada Hoffler Tower
1/31/2025
805,605
3.3%
1.4%
The Art Institute
1
1
Two Columbus
12/31/2019
787,226
3.3%
1.4%
Pender & Coward
1
1
Armada Hoffler Tower
1/31/2030
781,536
3.2%
1.4%
Kimley Horn
1
1
Two Columbus
12/31/2018
682,162
2.8%
1.2%
Top 10 Total
$17,138,764
70.8%
29.8%
Retail
Tenant
Number
of Leases
Number
of
Properties
Properties
Lease
Expiration
Annualized
Base Rent
% of Retail
Portfolio
Annualized
Base Rent
% of Total
Portfolio
Annualized
Base Rent
Home Depot
2
2
Broad Creek Shopping Center, North Point Center
12/3/2019
$2,189,900
9.5%
3.8%
Harris Teeter
2
2
Tyre Neck Harris Teeter, Hanbury Village
10/16/2028
1,430,532
6.2%
2.5%
Food Lion
3
3
Broad Creek Shopping Center, Bermuda Crossroads,
Gainsborough Square
3/19/2020
1,282,568
5.6%
2.2%
Dick's Sporting Goods
1
1
Dick's at Town Center
1/31/2020
798,000
3.5%
1.4%
Regal Cinemas
1
1
Harrisonburg Regal
4/23/2019
683,550
3.0%
1.2%
PetSmart
2
2
Broad Creek Shopping Center, North Point Center
7/21/2018
618,704
2.7%
1.1%
Kroger
1
1
North Point Center
8/31/2018
552,864
2.4%
1.0%
Yard House
1
1
Commerce Street Retail
11/30/2023
538,000
2.3%
0.9%
Rite Aid
2
2
Gainsborough Square, Parkway Marketplace
5/29/2019
484,193
2.1%
0.8%
Walgreens
1
1
Hanbury Village
12/31/2083
447,564
1.9%
0.8%
Top 10 Total
$9,025,875
39.3%
15.7%
(1) Sold 1/5/15


Office Lease Summary
24
Renewal Lease Summary
(1)
GAAP
Cash
Quarter
Number of
Leases
Signed
Net rentable
SF Signed
Leases
Expiring
Net rentable
SF Expiring
Contractual
Rent per SF
Prior Rent
per SF
Annual
Change in
Rent per SF
Contractual
Rent per SF
Prior Rent
per SF
Annual Change
in Rent per SF
Weighted
Average Lease
Term
TI, LC, &
Incentives
TI, LC, &
Incentives
per SF
4th Quarter 2014
6
                    
26,386
         
3
                    
5,726
           
$21.08
$21.23
($0.15)
$20.50
$22.14
($1.65)
3.65
                    
$182,728
$6.93
3rd Quarter 2014
3
                    
6,859
           
2
                    
6,082
           
18.50
               
19.63
       
(1.13)
            
18.48
           
19.85
         
(1.36)
                 
2.62
                    
68,913
             
10.05
        
2nd Quarter 2014
2
                    
18,824
         
1
                    
8,452
           
25.12
               
24.33
       
0.79
              
25.37
           
27.55
         
(2.18)
                 
7.75
                    
204,718
          
10.88
        
1st Quarter 2014
1
                    
25,506
         
2
                    
5,430
           
32.28
               
26.66
       
5.63
              
29.95
           
29.25
         
0.70
                  
10.00
                 
1,315,127
       
51.56
        
New Lease Summary
(1)
Quarter
Number of
Leases
Signed
Net rentable
SF Signed
Contractual
Rent per SF
Weighted
Average
Lease Term
TI, LC, &
Incentives
TI, LC, &
Incentives
per SF
4th Quarter 2014
1
                    
4,754
           
$17.50
10.00
           
$103,266
$21.72
3rd Quarter 2014
2
                    
2,853
           
22.65
           
2.56
             
55,892
            
19.59
       
2nd Quarter 2014
4
                    
6,948
           
20.18
           
4.28
             
190,255
          
27.38
       
1st Quarter 2014
2
                    
5,430
           
24.12
           
1.00
             
5,239
               
0.96
         
(1) Excludes leases for space occupied by AHH.


Office Lease Expirations
25
1.8%
4.0%
6.5%
18.3%
9.4%
4.9%
4.0%
5.4%
10.6%
35.2%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
Year of Lease Expiration
Number of
Leases
Expiring
Square
Footage of
Leases
Expiring
% Portfolio
Net Rentable
Square Feet
Annualized
Base Rent
% of Portfolio
Annualized
Base Rent
Annualized Base
Rent per Leased
Square Foot
Available
-
43,974
4.8%
$0
-
$0.00
2015
12
17,012
1.9%
424,967
1.8%
24.98
2016
15
41,197
4.5%
977,367
4.0%
23.72
2017
6
65,186
7.1%
1,564,421
6.5%
24.00
2018
19
162,718
17.7%
4,435,761
18.3%
27.26
2019
10
95,977
10.5%
2,268,983
9.4%
23.64
2020
5
43,731
4.8%
1,176,453
4.9%
26.90
2021
4
41,363
4.5%
973,852
4.0%
23.54
2022
3
48,117
5.2%
1,295,525
5.4%
26.92
2023
4
115,889
12.6%
2,578,196
10.6%
22.25
Thereafter
8
242,998
26.5%
8,515,178
35.2%
35.04
Total / Weighted Average
86
918,162
100.0%
24,210,702
$
100.0%
$27.70


Retail Lease Summary
26
Renewal Lease Summary
(1)
GAAP
Cash
Quarter
Number of
Leases
Signed
Net rentable
SF Signed
Leases
Expiring
Net
rentable SF
Expiring
Contractual
Rent per SF
Prior Rent
per SF
Annual Change
in Rent per SF
Contractual
Rent per SF
Prior Rent
per SF
Annual Change
in Rent per SF
Weighted
Average Lease
Term
TI, LC, &
Incentives
TI, LC, &
Incentives
per SF
4th Quarter 2014
6
                    
17,361
         
2
                  
2,991
        
$24.91
$21.35
$3.57
$24.80
$23.10
$1.71
4.37
                    
$18,858
$1.09
3rd Quarter 2014
6
                    
26,900
         
3
                  
6,012
        
17.64
              
16.19
        
1.45
                  
17.76
             
16.98
       
0.78
                    
5.11
                    
44,109
        
1.64
             
2nd Quarter 2014
6
                    
12,916
         
2
                  
3,842
        
20.47
              
19.66
        
0.81
                  
20.20
             
20.65
       
(0.46)
                   
1.87
                    
5,730
           
0.44
             
1st Quarter 2014
5
                    
23,857
         
3
                  
6,540
        
20.84
              
20.41
        
0.43
                  
21.18
             
21.82
       
(0.64)
                   
4.55
                    
63,339
        
2.65
             
New Lease Summary
(1)
Quarter
Number of
Leases
Signed
Net rentable
SF Signed
Contractual
Rent per SF
Weighted
Average
Lease Term
TI, LC, &
Incentives
TI, LC, &
Incentives
per SF
4th Quarter 2014
1
                    
2,140
           
$16.00
5.00
          
$2,140
$1.00
3rd Quarter 2014
7
                    
35,574
         
20.30
         
6.83
          
522,738
         
14.69
        
2nd Quarter 2014
4
                    
10,574
         
25.73
         
7.78
          
1,071,485
      
101.33
      
1st Quarter 2014
1
                    
3,160
           
16.25
         
10.50
        
126,558
         
40.05
        
(1) Excludes leases from space occupied by AHH


Retail Lease Expiration
27
Year of Lease Expiration
Number of
Leases
Expiring
Square
Footage of
Leases
Expiring
% Portfolio
Net Rentable
Square Feet
Annualized
Base Rent
% of Portfolio
Annualized
Base Rent
Annualized Base
Rent per Leased
Square Foot
Available
-
43,386
3.6%
$0
-    
$0.00
2015
16
51,906
4.3%
1,063,979
5.4%
20.50
2016
23
73,259
6.1%
1,651,561
8.4%
22.54
2017
25
152,603
12.7%
2,223,266
11.4%
14.57
2018
23
136,687
11.4%
2,034,025
10.4%
14.88
2019
25
327,441
27.3%
4,795,310
24.5%
14.64
2020
18
200,877
16.7%
2,770,104
14.1%
13.79
2021
5
25,204
2.1%
740,832
3.8%
29.39
2022
6
83,588
7.0%
1,216,663
6.2%
14.56
2023
6
49,460
4.1%
1,331,093
6.8%
26.91
Thereafter
11
56,327
4.7%
1,759,270
9.0%
31.23
Total / Weighted Average
158
1,200,738
100.0%
19,586,105
$
100.0%
$16.92
5.4%
8.4%
11.4%
10.4%
24.5%
14.1%
3.8%
6.2%
6.8%
9.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%


Historical Occupancy
28
(1) Office and retail occupancy based on occupied square feet as a % of respective total
(2) Multifamily occupancy based on occupied units as a % of respective total
(3) Total occupancy weighted by annualized base rent
Occupancy -
All Properties
as of
Sector
12/31/2014
9/30/2014
6/30/2014
3/31/2014
12/31/2013
Office
(1)
95.2%
94.8%
95.3%
95.4%
95.2%
Retail
(1)
96.4%
94.7%
93.5%
93.4%
93.4%
Multifamily
(2)
95.7%
96.6%
94.9%
94.2%
94.2%
Weighted Average
(3)
95.7%
95.1%
94.6%
94.5%
94.4%


Multifamily Occupancy
29
Occupancy Summary - Smiths Landing (284 available units)
Quarter Ended
Number of Units
Occupied
Percentage
Occupied
(1)
Annualized Base
Rent
(2)
Average Monthly Rent
per Occupied Unit
12/31/2014
278
97.9%
$3,472,020
$1,041
9/30/2014
274
96.5%
3,379,428
                     
1,028
                             
6/30/2014
273
96.1%
3,321,096
                     
1,014
                             
3/31/2014
283
99.6%
3,430,260
                     
1,010
                             
12/31/2013
282
99.3%
3,382,380
                     
1,000
                             
Occupancy Summary - The Cosmopolitan (342 available units)
Quarter Ended
Number of Units
Occupied
Percentage
Occupied
(1)
Annualized Base
Rent
(2)(4)
Average Monthly Rent
per Occupied Unit
(3)
12/31/2014
321
93.9%
$6,052,488
$1,571
9/30/2014
331
96.8%
6,218,892
                     
1,566
                             
6/30/2014
321
93.9%
6,042,132
                     
1,569
                             
3/31/2014
307
89.8%
5,799,564
                     
1,574
                             
12/31/2013
308
90.1%
5,721,144
                     
1,548
                             
(1)
Total units occupied as of each respective date
(2)
Annualized base rent is calculated by multiplying (a) contractual rent due from our tenants for the last month of the respective quarter by (b) 12
(3)
Average Monthly Rent per Occupied Unit is calculated as (a) annualized base rent divided by (b) the number of occupied units as of the end of the respective date.
(4)
Excludes annualized base rent from retail leases


30
Components of NAV
Stabilized Portfolio NOI x Market Cap Rate = Stabilized Portfolio Value
Investment in Unstabilized Development Pipeline
Stabilized
Development
Pipeline
NOI
x
Market
Cap
Rate
=
Stabilized
Development
Portfolio
Value
Annualized General Contracting and Real Estate Services x Appropriate Multiple = TRS Value
Other Assets
Liabilities
NAV


Net Asset Value Component Data
31
$ in thousands
(1) Includes leases for space occupied by Armada Hoffler which are eliminated for GAAP purposes
(2) Completed Not Stabilized properties are presented in our Consolidated Balance Sheet as Income Producing Property
Stabilized Portfolio NOI (Cash)
Other Assets
Three months
ended
Annualized
As of 12/31/2014
12/31/2014
12/31/2014
Other Assets
Diversified
Portfolio
Cash and Cash Equivalents
$25,883
Office
$2,050
$8,200
Restricted Cash
4,224
Retail
3,493
13,972
Accounts Receivable
20,548
Multifamily
613
2,452
Construction receivables, including retentions
19,432
Total Diversified Portfolio NOI
$6,156
$24,624
Other Assets
33,380
Total Other Assets
$103,467
Virginia
Beach
Town Center
Office
(1)
$2,338
$9,352
Liabilities & Share Count
Retail
(1)
1,252
5,008
As of 12/31/2014
Multifamily
1,115
4,460
Liabilities
Total Virginia Beach Town Center NOI
$4,705
$18,820
Mortgages and notes payable
$359,229
Accounts payable and accrued liabilities
8,358
Stabilized Portfolio NOI (Cash)
$10,861
$43,444
Construction payables, including retentions
42,399
Other Liabilities
19,014
Development Pipeline
Total Liabilities
$429,000
12/31/2014
Construction in Progress:  (pg. 9  balance sheet)
$81,082
Three months
ended
99,115
Share Count
12/31/2014
Weighted Average Common Shares Outstanding
25,020
Taxable REIT Subsidiary (TRS)
Weighted Average Operating Partnership ("OP") Units Outstanding
14,776
Full Year
Total Weighted Average Common shares and OP units outstanding
39,796
12/31/2014
General Contracting and Real Estate Services
$4,567
Development Pipeline Completed Not Stabilized at Cost 
 
(2)


Appendix –
Definitions & Reconciliations


Definitions
Net Operating Income:
Funds From Operations:
33
We calculate Net Operating Income (“NOI”) as property revenues (base rent, expense reimbursements and other
revenue) less property expenses (rental expenses and real estate taxes).  For our office, retail and multifamily
segments, NOI excludes general contracting and real estate services expenses, depreciation and amortization, general
and administrative expenses, and impairment charges. Other REITs may use different methodologies for calculating
NOI, and accordingly, our NOI may not be comparable to such other REITs’ NOI.  NOI is not a measure of operating
income or cash flows from operating activities as measured by GAAP and is not indicative of cash available to fund
cash needs. As a result, net operating income should not be considered an alternative to cash flows as a measure of
liquidity.  We consider NOI to be an appropriate supplemental measure to net income because it assists both investors
and management in understanding the core operations of our real estate business. (Reconciliation to GAAP located in
appendix pg. 40)
We calculate Funds From Operations (“FFO”) in accordance with the standards established by the National Association
of Real Estate Investment Trusts (“NAREIT”). NAREIT defines FFO as net income (loss) (calculated in accordance with
accounting principles generally accepted in the United States (“GAAP”)), excluding gains (or losses) from sales of
depreciable operating property, real estate related depreciation and amortization (excluding amortization of deferred
financing costs) and after adjustments for unconsolidated partnerships and joint ventures.
FFO is a supplemental non-GAAP financial measure. Management uses FFO as a supplemental performance measure
because it believes that FFO is beneficial to investors as a starting point in measuring our operational performance.
Specifically, in excluding real estate related depreciation and amortization and gains and losses from property
dispositions, which do not relate to or are not indicative of operating performance, FFO provides a performance
measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. 
Other equity REITs may not calculate FFO in accordance with the NAREIT definition as we do, and, accordingly, our
FFO may not be comparable to such other REITs’ FFO.


Definitions
Normalized Funds From Operations:
Core Funds From Operations:
34
We calculate Core Funds From Operations ("Core FFO") as Normalized FFO adjusted for mark-to-market adjustments on
interest rate derivatives, noncash stock compensation expense and the impact of development pipeline projects that
are still in lease-up.  We generally consider a property to be in lease-up until the earlier of (i) the quarter after which
the property reaches 80% occupancy or (ii) the thirteenth quarter after the property receives its certificate of
occupancy.
Management believes that the computation of FFO in accordance to NAREIT’s definition includes certain items that are
not indicative of the results provided by the Company’s operating portfolio and affect the comparability of the
Company’s period-over-period performance.  Our calculation of Core FFO differs from NAREIT's definition of FFO. 
Other equity REITs may not calculate Core FFO in the same manner as us, and, accordingly, our Core FFO may not be
comparable to other REITs' Core FFO.
We calculate Normalized Funds From Operations (“Normalized FFO") as FFO calculated in accordance with the
standards established by NAREIT, adjusted for acquisition, development and other pursuit costs, gains or losses from
the early extinguishment of debt, impairment charges, mark-to-market adjustments on interest rate derivatives and
other nonrecurring or noncomparable items.  
Management believes that the computation of FFO in accordance to NAREIT’s definition includes certain items that are
not indicative of the results provided by the Company’s operating portfolio and affect the comparability of the
Company’s period-over-period performance.  Our calculation of Normalized FFO differs from NAREIT's definition of FFO
Other equity REITs may not calculate Normalized FFO in the same manner as us, and, accordingly, our Normalized FFO
may not be comparable to other REITs' Normalized FFO.


Definitions
Adjusted Funds From Operations:
EBITDA:
35
We calculate Adjusted Funds From Operations (“AFFO”) as Core FFO, (i) excluding the impact of tenant improvement
and leasing commission costs, capital expenditures, the amortization of deferred financing fees, derivative (income)
loss, the net effect of straight-line rents and the amortization of lease incentives and net above (below) market rents
and (ii) adding back the impact of development pipeline projects that are still in lease-up and government
development grants that are not included in FFO.
Management believes that AFFO provides useful supplemental information to investors regarding our operating
performance as it provides a consistent comparison of our operating performance across time periods and allows
investors to more easily compare our operating results with other REITs. However, other REITs may use different
methodologies for calculating AFFO or similarly entitled FFO measures and, accordingly, our AFFO may not always be
comparable to AFFO or other similarly entitled FFO measures of other REITs.
We calculate EBITDA as net income (loss) (calculated in accordance with GAAP), excluding interest expense, income
taxes and depreciation and amortization. Management believes EBITDA is useful to investors in evaluating and
facilitating comparisons of our operating performance between periods and between REITs by removing the impact of
our capital structure (primarily interest expense) and asset base (primarily depreciation and amortization) from our
operating results.


Definitions
Core EBITDA:
We calculate Core EBITDA as EBITDA, excluding certain items, including, but not limited to, non-recurring or
extraordinary gains (losses), early extinguishment of debt, derivative (income) losses, acquisition costs and the impact
of development pipeline projects that are still in lease-up. We generally consider a property to be in lease-up until the
earlier of (i) the quarter after which the property reaches 80% occupancy or (ii) the thirteenth quarter after the
property receives its certificate of occupancy. Management believes that Core EBITDA provides useful supplemental
information to investors regarding our ongoing operating performance as it provides a consistent comparison of our
operating performance across time periods and allows investors to more easily compare our operating results with other
REITs. However, other REITs may use different methodologies for calculating Core EBITDA or similarly entitled measures
and, accordingly, our Core EBITDA may not always be comparable to Core EBITDA or other similarly entitled measures
of other REITs.
Core Debt:
We calculate Core Debt as our total debt, excluding any construction loans associated with our development pipeline.
Same Store Portfolio:
We define same store properties as including those properties that were owned and operated for the entirety of the
period being presented and excluding properties that were in lease-up during the period present.  We generally
consider
a
property
to
be
in
lease-up
until
the
earlier
of
(i)
the
quarter
after
which
the
property
reaches
80%
occupancy
or (ii) the thirteenth quarter after the property receives its certificate of occupancy.  The following table shows the
properties included in the same store and non-same store portfolio for the comparative periods presented.
36


Same Store vs. Non-Same Store Properties
37
Same Store
Non-Same Store
Same Store
Non-Same Store
Office Properties
Armada Hoffler Tower
X
X
One Columbus
X
X
Two Columbus
X
X
Richmond Tower
X
X
Oyster Point
X
X
Sentara Williamsburg
X
X
4525 Main Street
X
X
Virginia Natural Gas
X
X
Retail Properties
Bermuda Crossroads
X
X
Broad Creek Shopping Center
X
X
Courthouse 7-Eleven
X
X
Dimmock Square
X
X
Gainsborough Square
X
X
Hanbury Village
X
X
North Point Center
X
X
Parkway Marketplace
X
X
Harrisonburg Regal
X
X
Dick’s at Town Center
X
X
249 Central Park Retail
X
X
Studio 56 Retail
X
X
Commerce Street Retail
X
X
Fountain Plaza Retail
X
X
South Retail
X
X
Tyre Neck Harris Teeter
X
X
Greentree Shopping Center
X
X
Multifamily Properties
Encore Apartments
X
X
Smith’s Landing
X
X
The Cosmopolitan
X
X
Liberty Apartments
X
X
Whetstone Apartments
X
X
Comparison of Year Ended   
December 31, 2014 to 2013
Comparison of Three Months Ended  
December 31, 2014 to 2013


Reconciliation to GAAP -
Segment Portfolio NOI
38
$ in thousands
(1)  See page 37 for Same Store vs. Non-Same Store Properties
Three months ended 12/31
Year ended 12/31
2014
2013
2014
2013
Office Same Store
(1)
Rental revenues
$6,499
$6,353
$25,640
$25,117
Property expenses
2,036
               
1,903
               
8,208
               
7,816
               
NOI
4,463
               
4,450
               
17,432
            
17,301
            
Non-Same Store NOI
744
                   
149
                   
1,685
               
601
                   
Segment NOI
$5,207
$4,599
$19,117
$17,902
Retail Same Store
(1)
Rental revenues
$5,780
$5,684
$20,874
$20,474
Property expenses
1,712
               
1,725
               
6,487
               
6,525
               
NOI
4,068
               
3,959
               
14,387
            
13,949
            
Non-Same Store NOI
531
                   
-
                    
2,461
               
1,027
               
Segment NOI
$4,599
$3,959
$16,848
$14,976
Multifamily Same Store
(1)
Rental revenues
$2,974
$2,784
$7,758
$7,494
Property expenses
1,277
               
1,254
               
3,555
               
3,441
               
NOI
1,697
               
1,530
               
4,203
               
4,053
               
Non-Same Store NOI
69
                     
-
                    
2,168
               
1,440
               
Segment NOI
1,766
               
1,530
               
$6,371
$5,493
Total Segment Portfolio NOI
$11,572
$10,088
$42,336
$38,371


Reconciliation to GAAP -
Segment Portfolio NOI
39
$ in thousands
Three months ended 12/31/2014
Diversified Portfolio
Office
Retail
Multifamily
Total
Cash NOI
$2,050
$3,493
$613
$6,156
Net effect of straight-line rents
192
(100)
(13)
79
Amortization of lease incentives and (above) below market rents
(12)
46
(13)
21
GAAP NOI
$2,230
$3,439
$587
$6,256
Town Center of Virginia Beach
Office
Retail
Multifamily
Total
Cash NOI
$2,338
$1,252
$1,115
$4,705
Net effect of straight-line rents
79
53
(5)
127
Amortization of lease incentives and (above) below market rents
(28)
(145)
-
(173)
Elimination of AHH rent
(156)
(74)
-
(230)
GAAP NOI
$2,233
$1,086
$1,110
$4,429
GAAP NOI
Office
Retail
Multifamily
Total
Diversified Portfolio
$2,230
$3,439
$587
$6,256
Town Center of Virginia Beach
2,233
1,086
1,110
4,429
Unstabilized Properties
744
74
69
887
Total Segment Portfolio GAAP NOI
$5,207
$4,599
$1,766
$11,572


Reconciliation to GAAP -
Segment Portfolio NOI
$ in thousands
40
Office
Retail
Multifamily
Total Rental
Properties
General Contracting &
Real Estate Services
Total
Segment revenues
7,464
$                  
6,397
$                  
3,660
$                  
17,521
$               
32,060
$                           
49,581
$               
Segment expenses
2,257
1,798
1,894
5,949
30,947
36,896
Net operating income
5,207
$                  
4,599
$                  
1,766
$                  
11,572
$               
1,113
$                             
12,685
$               
Depreciation and amortization
(4,976)
General and administrative expenses
(1,943)
Acquisition, development and other pursuit costs
(55)
Impairment charges
-
Interest expense
(2,671)
Gain on dispositions
2,211
Other expense
(90)
Income tax benefit
65
Net income
5,226
$                  
Office
Retail
Multifamily
Total Rental
Properties
General Contracting &
Real Estate Services
Total
Segment revenues
27,827
$               
23,956
$               
12,963
$               
64,746
$               
103,321
$                        
168,067
$             
Segment expenses
8,710
7,108
6,592
22,410
98,754
121,164
Net operating income
19,117
$               
16,848
$               
6,371
$                  
42,336
$               
4,567
$                             
46,903
$               
Depreciation and amortization
(17,569)
General and administrative expenses
(7,711)
Acquisition, development and other pursuit costs
(229)
Impairment charges
(15)
Interest expense
(10,648)
Gain on dispositions
2,211
Other expense
(113)
Income tax provision
(70)
Net income
12,759
$               
Three months ended 12/31/2014
Year ended 12/31/2014