American Assets Trust, Inc. [AAT] Filings

10-Q 1 aat-20230930.htm 10-Q aat-20230930

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

AMERICAN ASSETS TRUST, INC.

(Exact Name of Registrant as Specified in its Charter)

Commission file number: 001-35030

AMERICAN ASSETS TRUST, L.P.

(Exact Name of Registrant as Specified in its Charter)

Commission file number: 333-202342-01

Maryland

(American Assets Trust, Inc.)

27-3338708

(American Assets Trust, Inc.)

Maryland

(American Assets Trust, L.P.)

27-3338894

(American Assets Trust, L.P.)

(State or other jurisdiction of incorporation or organization)

(IRS Employer Identification No.)

3420 Carmel Mountain Road, Suite 100

San Diego, California 92121

(Address of Principal Executive Offices and Zip Code)

(858) 350-2600

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

American Assets Trust, Inc. ☒ Yes ☐ No

American Assets Trust, L.P. ☒ Yes ☐ No

(American Assets Trust, L.P. became subject to filing requirements under Section 13 of the Securities Exchange Act of 1934, as amended, upon effectiveness of its Registration Statement on Form S-3 on February 6, 2015 and has filed all required reports subsequent to that date.)

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).

American Assets Trust, Inc. ☒ Yes ☐ No

American Assets Trust, L.P. ☒ Yes ☐ No

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

American Assets Trust, Inc.

Large Accelerated Filer

☒

Accelerated Filer

☐

Non-Accelerated Filer

☐

(Do not check if a smaller reporting company)

Smaller reporting company

☐

Emerging growth company

☐

American Assets Trust, L.P.

Large Accelerated Filer

☐

Accelerated Filer

☐

Non-Accelerated Filer

☒

(Do not check if a smaller reporting company)

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

American Assets Trust, Inc. ☐ Yes ☒ No

American Assets Trust, L.P. ☐ Yes ☒ No

Securities registered pursuant to Section 12(b) of the Act:


Name of Registrant	Title of each class	Trading Symbol	Name of each exchange on which registered
American Assets Trust, Inc.	Common Stock, par value $0.01 per share	AAT	New York Stock Exchange
American Assets Trust, L.P.	None	None	None

American Assets Trust, Inc. had 60,724,630 shares of common stock, par value $0.01 per share, outstanding as of October 27, 2023.

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EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the quarter ended September 30, 2023 of American Assets Trust, Inc., a Maryland corporation, and American Assets Trust, L.P., a Maryland limited partnership, of which American Assets Trust, Inc. is the parent company and sole general partner. Unless otherwise indicated or unless the context requires otherwise, all references in this report to “we,” “us,” “our” or “the company” refer to American Assets Trust, Inc. together with its consolidated subsidiaries, including American Assets Trust, L.P. Unless otherwise indicated or unless the context requires otherwise, all references in this report to “our Operating Partnership” or “the Operating Partnership” refer to American Assets Trust, L.P. together with its consolidated subsidiaries.

American Assets Trust, Inc. operates as a real estate investment trust, or REIT, and is the sole general partner of the Operating Partnership. As of September 30, 2023, American Assets Trust, Inc. owned an approximate 78.8% partnership interest in the Operating Partnership. The remaining approximately 21.2% partnership interests are owned by non-affiliated investors and certain of our directors and executive officers. As the sole general partner of the Operating Partnership, American Assets Trust, Inc. has full, exclusive and complete authority and control over the Operating Partnership’s day-to-day management and business, can cause it to enter into certain major transactions, including acquisitions, dispositions and debt refinancings, and can cause changes in its line of business, capital structure and distribution policies.

American Assets Trust, Inc. believes that combining the quarterly reports on Form 10-Q of American Assets Trust, Inc. and the Operating Partnership into a single report will result in the following benefits:

•better reflects how management and the analyst community view the business as a single operating unit;

•enhance investors' understanding of American Assets Trust, Inc. and the Operating Partnership by enabling them to view the business as a whole and in the same manner as management;

•greater efficiency for American Assets Trust, Inc. and the Operating Partnership and resulting savings in time, effort and expense; and

•greater efficiency for investors by reducing duplicative disclosure by providing a single document for their review.

The management of American Assets Trust, Inc. and the Operating Partnership is the same and operates American Assets Trust, Inc. and the Operating Partnership as one enterprise.

There are certain differences between American Assets Trust, Inc. and the Operating Partnership, which are reflected in the disclosures in this report. We believe it is important to understand the differences between American Assets Trust, Inc. and the Operating Partnership in the context of how American Assets Trust, Inc. and the Operating Partnership operate as an interrelated consolidated company. American Assets Trust, Inc. is a REIT, whose only material asset is its ownership of partnership interests of the Operating Partnership. As a result, American Assets Trust, Inc. does not conduct business itself, other than acting as the sole general partner of the Operating Partnership, issuing public equity from time to time and guaranteeing certain debt of the Operating Partnership. American Assets Trust, Inc. itself does not hold any indebtedness. The Operating Partnership holds substantially all the assets of the company, directly or indirectly holds the ownership interests in the company's real estate ventures, conducts the operations of the business and is structured as a partnership with no publicly-traded equity. Except for net proceeds from public equity issuances by American Assets Trust, Inc., which are generally contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates the capital required by American Assets Trust, Inc.'s business through the Operating Partnership’s operations, by the Operating Partnership’s direct or indirect incurrence of indebtedness or through the issuance of operating partnership units.

Noncontrolling interests and stockholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of American Assets Trust, Inc. and those of American Assets Trust, L.P. The partnership interests in the Operating Partnership that are not owned by American Assets Trust, Inc. are accounted for as partners’ capital in the Operating Partnership’s financial statements and as noncontrolling interests in American Assets Trust, Inc.’s financial statements. To help investors understand the significant differences between American Assets Trust, Inc. and the Operating Partnership, this report presents the following separate sections for each of American Assets Trust, Inc. and the Operating Partnership:

•consolidated financial statements;

•the following notes to the consolidated financial statements:

◦Debt;

◦Equity/Partners' Capital; and

◦Earnings Per Share/Unit; and

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•Liquidity and Capital Resources in Management's Discussion and Analysis of Financial Condition and Results of Operations.

This report also includes separate Item 4. Controls and Procedures sections and separate Exhibit 31 and 32 certifications for each of American Assets Trust, Inc. and the Operating Partnership in order to establish that the Chief Executive Officer and the Chief Financial Officer of American Assets Trust, Inc. have made the requisite certifications and American Assets Trust, Inc. and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934 and 18 U.S.C. §1350.

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AMERICAN ASSETS TRUST, INC. AND AMERICAN ASSETS TRUST, L.P.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED SEPTEMBER 30, 2023


PART 1. FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Financial Statements of American Assets Trust, Inc.:
		Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022	1
		Consolidated Statements of Comprehensive Income (unaudited) for the three and nine months ended September 30, 2023 and 2022	2
		Consolidated Statement of Equity (unaudited) for the three and nine months ended September 30, 2023 and 2022	3
		Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2023 and 2022	5
	Consolidated Financial Statements of American Assets Trust, L.P.:
		Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022	6
		Consolidated Statements of Comprehensive Income (unaudited) for the three and nine months ended September 30, 2023 and 2022	7
		Consolidated Statement of Partners' Capital (unaudited) for the three and nine months ended September 30, 2023 and 2022	8
		Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2023 and 2022	10
	Notes to Consolidated Financial Statements (unaudited)		11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		31
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		50
Item 4.	Controls and Procedures		51
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		52
Item 1A.	Risk Factors		52
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		52
Item 3.	Defaults Upon Senior Securities		53
Item 4.	Mine Safety Disclosures		53
Item 5.	Other Information		53
Item 6.	Exhibits		53
SIGNATURES			54

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PART 1 - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

American Assets Trust, Inc.

Consolidated Balance Sheets

(In Thousands, Except Share Data)


	September 30,		December 31,
	2023		2022
	(unaudited)
ASSETS
Real estate, at cost
Operating real estate	$	3,494,369	$	3,468,537
Construction in progress	233,720		202,385
Held for development	547		547
	3,728,636		3,671,469
Accumulated depreciation	(1,013,367)		(936,913)
Real estate, net	2,715,269		2,734,556
Cash and cash equivalents	89,968		49,571


Accounts receivable, net	7,875		7,848
Deferred rent receivables, net	89,023		87,192
Other assets, net	108,584		108,714
TOTAL ASSETS	$	3,010,719	$	2,987,881
LIABILITIES AND EQUITY
LIABILITIES:
Secured notes payable, net	$	74,646	$	74,578
Unsecured notes payable, net	1,614,307		1,539,453
Unsecured line of credit, net	—		34,057

Accounts payable and accrued expenses	70,970		65,992
Security deposits payable	8,952		8,699
Other liabilities and deferred credits, net	73,194		79,577
Total liabilities	1,842,069		1,802,356
Commitments and contingencies (Note 11)
EQUITY:
American Assets Trust, Inc. stockholders’ equity
Common stock, $0.01 par value, 490,000,000 shares authorized, 60,724,630 and 60,718,653 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively	607		607
Additional paid-in capital	1,467,455		1,461,201
Accumulated dividends in excess of net income	(270,817)		(251,167)
Accumulated other comprehensive income	12,051		10,624
Total American Assets Trust, Inc. stockholders’ equity	1,209,296		1,221,265
Noncontrolling interests	(40,646)		(35,740)
Total equity	1,168,650		1,185,525
TOTAL LIABILITIES AND EQUITY	$	3,010,719	$	2,987,881

The accompanying notes are an integral part of these consolidated financial statements.

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American Assets Trust, Inc.

Consolidated Statements of Comprehensive Income

(Unaudited)

(In Thousands, Except Shares and Per Share Data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
REVENUE:
Rental income	$	105,494	$	105,468	$	312,105	$	301,470
Other property income	5,704		5,555		16,568		15,178
Total revenue	111,198		111,023		328,673		316,648
EXPENSES:
Rental expenses	29,912		28,438		86,128		78,436
Real estate taxes	11,399		11,477		34,117		34,193
General and administrative	8,880		8,376		26,488		23,130
Depreciation and amortization	29,868		31,729		89,592		93,228
Total operating expenses	80,059		80,020		236,325		228,987
OPERATING INCOME	31,139		31,003		92,348		87,661
Interest expense, net	(16,325)		(14,454)		(48,422)		(43,667)


Other income (expense), net	321		(180)		7,272		(523)





NET INCOME	15,135		16,369		51,198		43,471
Net income attributable to restricted shares	(189)		(155)		(568)		(464)
Net income attributable to unitholders in the Operating Partnership	(3,168)		(3,442)		(10,733)		(9,130)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, INC. STOCKHOLDERS	$	11,778	$	12,772	$	39,897	$	33,877

EARNINGS PER COMMON SHARE
Earnings per common share, basic	$	0.20	$	0.21	$	0.66	$	0.56
Weighted average shares of common stock outstanding - basic	60,150,681		60,044,117		60,147,189		60,041,034

Earnings per common share, diluted	$	0.20	$	0.21	$	0.66	$	0.56
Weighted average shares of common stock outstanding - diluted	76,332,218		76,225,654		76,328,726		76,222,571

DIVIDENDS DECLARED PER COMMON SHARE	$	0.33	$	0.32	$	0.99	$	0.96

COMPREHENSIVE INCOME
Net income	$	15,135	$	16,369	$	51,198	$	43,471
Other comprehensive income - unrealized income on swap derivatives during the period	768		4,207		2,859		13,117

Reclassification of amortization of forward-starting swap included in interest expense	(99)		(275)		(1,051)		(825)

Comprehensive income	15,804		20,301		53,006		55,763
Comprehensive income attributable to non-controlling interests	(3,310)		(4,277)		(11,114)		(11,739)
Comprehensive income attributable to American Assets Trust, Inc.	$	12,494	$	16,024	$	41,892	$	44,024

The accompanying notes are an integral part of these consolidated financial statements.

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American Assets Trust, Inc.

Consolidated Statement of Equity

(Unaudited)

(In Thousands, Except Share Data)


	American Assets Trust, Inc. Stockholders’ Equity									Noncontrolling Interests - Unitholders in the Operating Partnership		Total
	Common Shares			Additional Paid-in Capital		Accumulated Dividends in Excess of Net Income		Accumulated Other Comprehensive Income (Loss)
	Shares	Amount
Balance at December 31, 2022	60,718,653	$	607	$	1,461,201	$	(251,167)	$	10,624	$	(35,740)	$	1,185,525
Net income	—	—		—		16,325		—		4,341		20,666


Forfeiture of restricted stock	(818)	—		—		—		—		—		—

Dividends declared and paid	—	—		—		(20,037)		—		(5,340)		(25,377)
Stock-based compensation	—	—		2,035				—		—		2,035

Other comprehensive income - change in value of interest rate swaps	—	—		—		—		(1,786)		(483)		(2,269)

Reclassification of amortization of forward-starting swap included in interest expense	—	—		—		—		(673)		(181)		(854)

Balance at March 31, 2023	60,717,835	607		1,463,236		(254,879)		8,165		(37,403)		1,179,726
Net income	—	—		—		12,173		—		3,224		15,397

Issuance of restricted stock	10,348	—		—		—		—		—		—
Forfeiture of restricted stock	(3,553)	—		—		—		—		—		—

Dividends declared and paid	—	—		—		(20,039)		—		(5,340)		(25,379)
Stock-based compensation	—	—		2,110		—		—		—		2,110

Other comprehensive income - change in value of interest rate swaps	—	—		—		—		3,436		924		4,360

Reclassification of amortization of forward-starting swap included in interest expense	—	—		—		—		(77)		(21)		(98)
Balance at June 30, 2023	60,724,630	$	607	$	1,465,346	$	(262,745)	$	11,524	$	(38,616)	$	1,176,116
Net income	—	—		—		11,967		—		3,168		15,135




Dividends declared and paid	—	—		—		(20,039)		—		(5,340)		(25,379)
Stock-based compensation	—	—		2,109		—		—		—		2,109

Other comprehensive income - change in value of interest rate swaps	—	—		—		—		605		163		768

Reclassification of amortization of forward-starting swap included in interest expense	—	—		—		—		(78)		(21)		(99)
Balance at September 30, 2023	60,724,630	$	607	$	1,467,455	$	(270,817)	$	12,051	$	(40,646)	$	1,168,650

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	American Assets Trust, Inc. Stockholders’ Equity									Noncontrolling Interests - Unitholders in the Operating Partnership		Total
	Common Shares			Additional Paid-in Capital		Accumulated Dividends in Excess of Net Income		Accumulated Other Comprehensive Income (Loss)
	Shares	Amount
Balance at December 31, 2021	60,525,580	$	605	$	1,453,272	$	(217,785)	$	2,872	$	(28,841)	$	1,210,123
Net income	—	—		—		10,678		—		2,836		13,514

Forfeiture of restricted stock	(3,121)	—		—		—		—		—		—


Dividends declared and paid	—	—		—		(19,367)		—		(5,178)		(24,545)
Stock-based compensation	—	—		1,489		—		—		—		1,489
Shares withheld for employee taxes	(416)	—		(15)		—		—		—		(15)
Other comprehensive income - change in value of interest rate swaps	—	—		—		—		4,408		1,188		5,596
Reclassification of amortization of forward-starting swap included in interest expense	—	—		—		—		(217)		(58)		(275)


Balance at March 31, 2022	60,522,043	605		1,454,746		(226,474)		7,063		(30,053)		1,205,887
Net income	—	—		—		10,736				2,852		13,588

Issuance of restricted stock	6,072	—		—		—		—		—		—


Dividends declared and paid	—	—		—		(19,369)		—		(5,178)		(24,547)
Stock-based compensation	—	—		2,001		—		—		—		2,001
Other comprehensive income - change in value of interest rate swaps	—	—		—		—		2,610		704		3,314


Reclassification of amortization of forward-starting swap realized gains included in interest expense	—	—		—		—		(216)		(59)		(275)
Balance at June 30, 2022	60,528,115	$	605	$	1,456,747	$	(235,107)	$	9,457	$	(31,734)	$	1,199,968
Net income	—	—				12,927				3,442		16,369




Dividends declared and paid	—	—		—		(19,369)		—		(5,178)		(24,547)
Stock-based compensation	—	—		2,001		—		—		—		2,001

Other comprehensive income - change in value of interest rate swaps	—	—		—		—		3,314		893		4,207

Reclassification of amortization of forward-starting swap included in interest expense	—	—		—		—		(217)		(58)		(275)
Balance at September 30, 2022	60,528,115	$	605	$	1,458,748	$	(241,549)	$	12,554	$	(32,635)	$	1,197,723

The accompanying notes are an integral part of these consolidated financial statements.

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American Assets Trust, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

(In Thousands)


	Nine Months Ended September 30,
	2023		2022
OPERATING ACTIVITIES
Net income	$	51,198	$	43,471


Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent revenue and amortization of lease intangibles	(6,167)		(8,766)
Depreciation and amortization	89,592		93,228
Amortization of debt issuance costs and debt discounts	2,553		1,930


Provision for uncollectable rental income	1,088		(31)


Stock-based compensation expense	6,254		5,491




Other noncash interest expense, net	(1,051)		(825)
Other, net	(588)		684
Changes in operating assets and liabilities
Change in accounts receivable	(847)		(1,072)
Change in other assets	(2,062)		(1,115)
Change in accounts payable and accrued expenses	9,126		5,753
Change in security deposits payable	252		777
Change in other liabilities and deferred credits	557		1,367


Net cash provided by operating activities	149,905		140,892
INVESTING ACTIVITIES
Acquisition of real estate	—		(45,167)
Capital expenditures	(64,229)		(88,314)

Leasing commissions	(5,999)		(6,153)



Net cash used in investing activities	(70,228)		(139,634)
FINANCING ACTIVITIES
Issuance of secured notes payable	—		75,000
Repayment of secured notes payable	—		(111,000)

Proceeds from unsecured term loan	225,000		—
Proceeds from unsecured line of credit	—		36,000
Repayment of unsecured line of credit	(36,000)		—


Repayment of unsecured term loan	(150,000)		—

Debt issuance costs	(2,145)		(3,697)


Dividends paid to common stock and unitholders	(76,135)		(73,639)

Shares withheld for employee taxes	—		(15)
Net cash used in financing activities	(39,280)		(77,351)
Net increase (decrease) in cash and cash equivalents	40,397		(76,093)
Cash and cash equivalents, beginning of period	49,571		139,524
Cash and cash equivalents, end of period	$	89,968	$	63,431

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same amounts shown in the consolidated statement of cash flows:


	Nine Months Ended September 30,
	2023		2022
Cash and cash equivalents	$	89,968	63,431
Restricted cash	—		—
Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows	$	89,968	$	63,431

The accompanying notes are an integral part of these consolidated financial statements.

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American Assets Trust, L.P.

Consolidated Balance Sheets

(In Thousands, Except Unit Data)


	September 30,		December 31,
	2023		2022
	(unaudited)
ASSETS
Real estate, at cost
Operating real estate	$	3,494,369	$	3,468,537
Construction in progress	233,720		202,385
Held for development	547		547
	3,728,636		3,671,469
Accumulated depreciation	(1,013,367)		(936,913)
Real estate, net	2,715,269		2,734,556
Cash and cash equivalents	89,968		49,571


Accounts receivable, net	7,875		7,848
Deferred rent receivables, net	89,023		87,192
Other assets, net	108,584		108,714
TOTAL ASSETS	$	3,010,719	$	2,987,881
LIABILITIES AND CAPITAL
LIABILITIES:
Secured notes payable, net	$	74,646	$	74,578
Unsecured notes payable, net	1,614,307		1,539,453
Unsecured line of credit, net	—		34,057
Accounts payable and accrued expenses	70,970		65,992
Security deposits payable	8,952		8,699
Other liabilities and deferred credits, net	73,194		79,577
Total liabilities	1,842,069		1,802,356
Commitments and contingencies (Note 11)
CAPITAL:
Limited partners' capital, 16,181,537 and 16,181,537 units issued and outstanding as of September 30, 2023 and December 31, 2022, respectively	(44,414)		(39,127)
General partner's capital, 60,724,630 and 60,718,653 units issued and outstanding as of September 30, 2023 and December 31, 2022, respectively	1,197,245		1,210,641
Accumulated other comprehensive income	15,819		14,011

Total capital	1,168,650		1,185,525
TOTAL LIABILITIES AND CAPITAL	$	3,010,719	$	2,987,881

The accompanying notes are an integral part of these consolidated financial statements.

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American Assets Trust, L.P.

Consolidated Statements of Comprehensive Income

(Unaudited)

(In Thousands, Except Shares and Per Unit Data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
REVENUE:
Rental income	$	105,494	$	105,468	$	312,105	$	301,470
Other property income	5,704		5,555		16,568		15,178
Total revenue	111,198		111,023		328,673		316,648
EXPENSES:
Rental expenses	29,912		28,438		86,128		78,436
Real estate taxes	11,399		11,477		34,117		34,193
General and administrative	8,880		8,376		26,488		23,130
Depreciation and amortization	29,868		31,729		89,592		93,228
Total operating expenses	80,059		80,020		236,325		228,987
OPERATING INCOME	31,139		31,003		92,348		87,661
Interest expense, net	(16,325)		(14,454)		(48,422)		(43,667)


Other income (expense), net	321		(180)		7,272		(523)





NET INCOME	15,135		16,369		51,198		43,471
Net income attributable to restricted shares	(189)		(155)		(568)		(464)
NET INCOME ATTRIBUTABLE TO AMERICAN ASSETS TRUST, L.P.	$	14,946	$	16,214	$	50,630	$	43,007

EARNINGS PER UNIT - BASIC
Earnings per unit, basic	$	0.20	$	0.21	$	0.66	$	0.56
Weighted average units outstanding - basic	76,332,218		76,225,654		76,328,726		76,222,571

EARNINGS PER UNIT - DILUTED
Earnings per unit, diluted	$	0.20	$	0.21	$	0.66	$	0.56
Weighted average units outstanding - diluted	76,332,218		76,225,654		76,328,726		76,222,571

DISTRIBUTIONS PER UNIT	$	0.33	$	0.32	$	0.99	$	0.96

COMPREHENSIVE INCOME
Net income	$	15,135	$	16,369	$	51,198	$	43,471
Other comprehensive income - unrealized income on swap derivatives during the period	768		4,207		2,859		13,117

Reclassification of amortization of forward-starting swap included in interest expense	(99)		(275)		(1,051)		(825)

Comprehensive income	15,804		20,301		53,006		55,763
Comprehensive income attributable to Limited Partners	(3,310)		(4,277)		(11,114)		(11,739)
Comprehensive income attributable to General Partner	$	12,494	$	16,024	$	41,892	$	44,024

The accompanying notes are an integral part of these consolidated financial statements.

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American Assets Trust, L.P.

Consolidated Statement of Partners' Capital

(Unaudited)

(In Thousands, Except Unit Data)


	Limited Partners' Capital (1)			General Partner's Capital (2)				Accumulated Other Comprehensive Income (Loss)		Total Capital
	Units	Amount		Units		Amount
Balance at December 31, 2022	16,181,537	$	(39,127)	60,718,653		$	1,210,641	$	14,011	$	1,185,525
Net income	—	4,341		—		16,325		—		20,666



Forfeiture of restricted units	—	—		(818)		—		—		—
Distributions	—	(5,340)		—		(20,037)		—		(25,377)
Stock-based compensation	—	—		—		2,035		—		2,035

Other comprehensive income - change in value of interest rate swap	—	—		—		—		(2,269)		(2,269)

Reclassification of amortization of forward starting swaps included in interest expense	—	—		—		—		(854)		(854)

Balance at March 31, 2023	16,181,537	(40,126)		60,717,835		1,208,964		10,888		1,179,726
Net income	—	3,224		—		12,173		—		15,397


Issuance of restricted units	—	—		10,348		—		—		—
Forfeiture of restricted units	—	—		(3,553)		—		—		—
Distributions	—	(5,340)		—		(20,039)		—		(25,379)
Stock-based compensation	—	—		—		2,110		—		2,110

Other comprehensive income - change in value of interest rate swap	—	—		—		—		4,360		4,360

Reclassification of amortization of forward-starting swap realized gains included in interest expense	—	—		—		—		(98)		(98)
Balance at June 30, 2023	16,181,537	$	(42,242)	$	60,724,630	$	1,203,208	$	15,150	$	1,176,116
Net income	—	3,168		—		11,967		—		15,135




Distributions	—	(5,340)		—		(20,039)		—		(25,379)
Stock-based compensation	—	—		—		2,109		—		2,109

Other comprehensive income - change in value of interest rate swap	—	—		—		—		768		768

Reclassification of amortization of forward-starting swap included in interest expense	—	—		—		—		(99)		(99)
Balance at September 30, 2023	16,181,537	$	(44,414)	60,724,630		$	1,197,245	$	15,819	$	1,168,650

Table of Contents


	Limited Partners' Capital (1)			General Partner's Capital (2)			Accumulated Other Comprehensive Income (Loss)		Total Capital
	Units	Amount		Units	Amount
Balance at December 31, 2021	16,181,537	$	(30,138)	60,525,580	$	1,236,092	$	4,169	$	1,210,123
Net income	—	2,836		—	10,678		—		13,514



Forfeiture of restricted units	—	—		(3,121)	—		—		—
Distributions	—	(5,178)		—	(19,367)		—		(24,545)
Stock-based compensation	—	—		—	1,489		—		1,489
Units withheld for employee taxes	—	—		(416)	(15)		—		(15)
Other comprehensive income - change in value of interest rate swap	—	—		—	—		5,596		5,596
Reclassification of amortization of forward starting swaps included in interest expense	—	—		—	—		(275)		(275)


Balance at March 31, 2022	16,181,537	(32,480)		60,522,043	1,228,877		9,490		1,205,887
Net income	—	2,852		—	10,736		—		13,588

Issuance of restricted units	—	—		6,072	—		—		—
Forfeiture of restricted units	—	—		—	—		—		—

Distributions	—	(5,178)		—	(19,369)		—		(24,547)
Stock-based compensation	—	—		—	2,001		—		2,001

Other comprehensive income - change in value of interest rate swap	—	—		—	—		3,314		3,314

Reclassification of amortization of forward-starting swap realized gains included in interest expense	—	—		—	—		(275)		(275)
Balance at June 30, 2022	16,181,537	$	(34,806)	60,528,115	$	1,222,245	$	12,529	$	1,199,968
Net income	—	3,442		—	12,927		—		16,369




Distributions	—	(5,178)		—	(19,369)		—		(24,547)
Stock-based compensation	—	—		—	2,001		—		2,001

Other comprehensive income - change in value of interest rate swap	—	—		—	—		4,207		4,207

Reclassification of amortization of forward-starting swap included in interest expense	—	—		—	—		(275)		(275)
Balance at September 30, 2022	16,181,537	$	(36,542)	60,528,115	$	1,217,804	$	16,461	$	1,197,723

(1) Consists of limited partnership interests held by third parties.

(2) Consists of general partnership interests held by American Assets Trust, Inc.

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

American Assets Trust, L.P.

Consolidated Statements of Cash Flows

(Unaudited, In Thousands)


	Nine Months Ended September 30,
	2023		2022
OPERATING ACTIVITIES
Net income	$	51,198	$	43,471


Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent revenue and amortization of lease intangibles	(6,167)		(8,766)
Depreciation and amortization	89,592		93,228
Amortization of debt issuance costs and debt discounts	2,553		1,930

Provision for uncollectable rental income	1,088		(31)

Stock-based compensation expense	6,254		5,491



Other noncash interest expense, net	(1,051)		(825)

Other, net	(588)

American Assets Trust, Inc. [AAT] Filings
10-Q	[2023-10-27]
10-Q	[2023-07-28]
10-Q	[2023-04-28]
10-K	[2023-02-10]
10-Q	[2022-10-28]
10-Q	[2022-07-29]
10-Q	[2022-04-29]
10-K	[2022-02-11]
10-Q	[2021-10-29]
10-Q	[2021-07-30]
10-Q	[2021-04-30]
10-K	[2021-02-16]
10-Q	[2020-10-30]
10-Q	[2020-07-31]
10-Q	[2020-05-01]
10-K	[2020-02-14]
10-Q	[2019-11-01]
10-Q	[2019-08-02]
10-Q	[2019-05-03]
10-K	[2019-02-15]
10-Q	[2018-11-02]
10-Q	[2018-08-03]
10-Q	[2018-05-04]
10-K	[2018-02-16]
10-Q	[2017-11-03]
10-Q	[2017-08-04]
10-Q	[2017-05-05]
10-K	[2017-02-17]
10-Q	[2016-11-04]
10-Q	[2016-07-29]
10-Q	[2016-04-29]
10-K	[2016-02-19]
10-Q	[2015-11-06]
10-Q	[2015-07-31]
10-Q	[2015-05-01]
10-K	[2015-02-20]
10-Q	[2014-11-07]
10-Q	[2014-08-01]
10-Q	[2014-05-02]
10-K	[2014-02-21]
10-Q	[2013-11-08]
10-Q	[2013-08-02]
10-Q	[2013-05-03]
10-K	[2013-02-22]
10-Q	[2012-11-09]
10-Q	[2012-08-03]
10-Q	[2012-05-04]
10-K	[2012-03-09]