Aimco Properties Earnings 2020-09-30

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

aiv-10q_20200930.htm

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ure

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2020

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

For the transition period from to

Commission File Number: 1-13232 (Apartment Investment and Management Company)

Commission File Number: 0-24497 (AIMCO Properties, L.P.)

Apartment Investment and Management Company

AIMCO Properties, L.P.

(Exact name of registrant as specified in its charter)

Maryland (Apartment Investment and Management Company)		84-1259577
Delaware (AIMCO Properties, L.P.)		84-1275621
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

4582 South Ulster Street, Suite 1700
Denver, Colorado		80237
(Address of principal executive offices)		(Zip Code)

(303) 757-8101

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address, and former fiscal year, if changed since last report)

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

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Class A Common Stock (Aimco Investment and Management Company)		AIV		New York Stock Exchange

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.

Apartment Investment and Management Company: Yes ☒ No ☐

AIMCO Properties, L.P.: Yes ☒ No ☐

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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Apartment Investment and Management Company: Yes ☒ No ☐

AIMCO Properties, 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 the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Apartment Investment and Management Company:

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

AIMCO Properties, L.P.:

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	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.

Apartment Investment and Management Company:

☐

AIMCO Properties, L.P.:

☐

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

Apartment Investment and Management Company: Yes ☐ No ☒

AIMCO Properties, L.P.: Yes ☐ No ☒

The number of shares of Apartment Investment and Management Company Class A Common Stock outstanding as of October 28, 2020: 148,865,947

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EXPLANATORY NOTE

This filing combines the reports on Form 10-Q for the quarterly period ended September 30, 2020, of Apartment Investment and Management Company, or Aimco, and AIMCO Properties, L.P., or the Aimco Operating Partnership. Where it is important to distinguish between the two entities, we refer to them specifically. Otherwise, references to “we,” “us,” or “our” mean, collectively, Aimco, the Aimco Operating Partnership, and their consolidated entities.

Aimco, a Maryland corporation, is a self-administered and self-managed real estate investment trust, or REIT. Aimco, through wholly-owned subsidiaries, is the general and special limited partner of the Aimco Operating Partnership. As of September 30, 2020, Aimco owned approximately 93.5% of the legal interest in the common partnership units of the Aimco Operating Partnership and 94.9% of the economic interest in the Aimco Operating Partnership. The remaining 6.5% legal interest and 5.1% economic interest is owned by limited partners. As the sole general partner of the Aimco Operating Partnership, Aimco has exclusive control of the Aimco Operating Partnership’s day-to-day management.

The Aimco Operating Partnership holds all of Aimco’s assets and manages the daily operations of Aimco’s business. Pursuant to the Aimco Operating Partnership agreement, Aimco is required to contribute to the Aimco Operating Partnership all proceeds from the offerings of its securities. In exchange for the contribution of such proceeds, Aimco receives additional interests in the Aimco Operating Partnership with similar terms (e.g., if Aimco contributes proceeds of a stock offering, Aimco receives partnership units with terms substantially similar to the stock issued by Aimco).

We believe combining the periodic reports of Aimco and the Aimco Operating Partnership into this single report provides the following benefits:

•

We present our business as a whole, in the same manner our management views and operates the business;

•

We eliminate duplicative disclosure and provide a more streamlined and readable presentation because a substantial portion of the disclosures apply to both Aimco and the Aimco Operating Partnership; and

•

We save time and cost through the preparation of a single combined report rather than two separate reports.

We operate Aimco and the Aimco Operating Partnership as one enterprise, the management of Aimco directs the management and operations of the Aimco Operating Partnership, and the members of the Board of Directors of Aimco are identical to those of the Aimco Operating Partnership’s general partner.

We believe it is important to understand the few differences between Aimco and the Aimco Operating Partnership in the context of how Aimco and the Aimco Operating Partnership operate as a consolidated company. Aimco has no assets or liabilities other than its investment in the Aimco Operating Partnership. Also, Aimco is a corporation that issues publicly traded equity from time to time, whereas the Aimco Operating Partnership is a partnership that has no publicly traded equity. Except for the net proceeds from stock offerings by Aimco, which are contributed to the Aimco Operating Partnership in exchange for additional limited partnership interests (of a similar type and in an amount equal to the shares of stock sold in the offering), the Aimco Operating Partnership generates all remaining capital required by its business. These sources include the Aimco Operating Partnership’s working capital, net cash provided by operating activities, borrowings under its revolving credit facility, the issuance of debt and equity securities, including additional partnership units, and proceeds received from the sale of apartment communities.

Equity, partners’ capital, and noncontrolling interests are the main areas of difference between the condensed consolidated financial statements of Aimco and those of the Aimco Operating Partnership. Interests in the Aimco Operating Partnership held by entities other than Aimco, which we refer to as OP Units, are classified within partners’ capital in the Aimco Operating Partnership’s financial statements and as noncontrolling interests in Aimco’s financial statements.

To help investors understand the differences between Aimco and the Aimco Operating Partnership, this report provides: separate condensed consolidated financial statements for Aimco and the Aimco Operating Partnership; a single set of condensed consolidated notes to such financial statements that includes separate discussions of each entity’s earnings per share or earnings per unit, as applicable; and a combined Management’s Discussion and Analysis of Financial Condition and Results of Operations section that includes discrete information related to each entity, where appropriate.

This report also includes separate Part I, Item 4. Controls and Procedures sections and separate Exhibits 31 and 32 certifications for Aimco and the Aimco Operating Partnership in order to establish that the requisite certifications have been made and that Aimco and the Aimco Operating Partnership are both compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and 18 U.S.C. §1350.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

AIMCO PROPERTIES, L.P.

TABLE OF CONTENTS

FORM 10-Q

		Page
	PART I. FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS
	Apartment Investment and Management Company:
	Condensed Consolidated Balance Sheets (Unaudited)	3
	Condensed Consolidated Statements of Operations (Unaudited)	4
	Condensed Consolidated Statements of Comprehensive Income (Unaudited)	5
	Condensed Consolidated Statements of Equity (Unaudited)	6
	Condensed Consolidated Statements of Cash Flows (Unaudited)	8
	AIMCO Properties, L.P.:
	Condensed Consolidated Balance Sheets (Unaudited)	9
	Condensed Consolidated Statements of Operations (Unaudited)	10
	Condensed Consolidated Statements of Comprehensive Income (Unaudited)	11
	Condensed Consolidated Statements of Partners’ Capital (Unaudited)	12
	Condensed Consolidated Statements of Cash Flows (Unaudited)	14
	Notes to the Condensed Consolidated Financial Statements of Apartment Investment and Management Company and AIMCO Properties, L.P. (Unaudited)	15
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	26
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	47
ITEM 4.	CONTROLS AND PROCEDURES	47
	PART II. OTHER INFORMATION
ITEM 1A.	RISK FACTORS	48
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	49
ITEM 6.	EXHIBITS	51
Signatures		52

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

	September 30, 2020			December 31, 2019
ASSETS
Buildings and improvements	$	7,006,395		$	6,868,543
Land		1,891,763			1,869,048
Total real estate		8,898,158			8,737,591
Accumulated depreciation		(2,858,174	)		(2,718,284	)
Net real estate		6,039,984			6,019,307
Cash and cash equivalents		228,368			142,902
Restricted cash		40,123			34,800
Mezzanine investment		300,326			280,258
Other assets		383,298			351,472
Assets held for sale		50,030			—
Total assets	$	7,042,129		$	6,828,739

LIABILITIES AND EQUITY
Non-recourse property debt, net	$	4,058,295		$	4,230,590
Term loan, net		348,502			—
Revolving credit facility borrowings		—			275,000
Total indebtedness		4,406,797			4,505,590
Accrued liabilities and other		356,538			360,574
Liabilities related to assets held for sale		58,177			—
Total liabilities		4,821,512			4,866,164

Redeemable preferred OP Units		79,449			97,064
Redeemable noncontrolling interests in consolidated real estate partnership		4,371			4,716
Commitments and contingencies (Note 4)
Equity:
Common Stock, $0.01 par value, 510,587,500 shares authorized, 148,865,947 and 148,885,197 shares issued/outstanding at September 30, 2020 and December 31, 2019, respectively		1,489			1,489
Additional paid-in capital		4,000,925			3,497,367
Accumulated other comprehensive income		3,579			4,195
Distributions in excess of earnings		(1,884,602	)		(1,722,402	)
Total Aimco equity		2,121,391			1,780,649
Noncontrolling interests in consolidated real estate partnerships		(60,212	)		(3,296	)
Common noncontrolling interests in Aimco Operating Partnership		75,618			83,442
Total equity		2,136,797			1,860,795
Total liabilities and equity	$	7,042,129		$	6,828,739

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
REVENUES
Rental and other property revenues	$	215,455		$	229,827		$	658,815		$	684,262

OPERATING EXPENSES
Property operating expenses		74,929			77,484			224,532			232,090
Depreciation and amortization		98,249			97,538			296,414			283,027
General and administrative expenses		8,118			10,595			27,922			31,922
Investment management expenses		2,819			1,581			5,124			4,319
Other expenses, net		17,571			4,002			23,452			12,759
Total operating expenses		201,686			191,200			577,444			564,117

Interest income		3,041			2,824			10,407			8,615
Interest expense		(50,519	)		(42,011	)		(140,657	)		(122,961	)
Gain on dispositions of real estate		—			1,146			47,204			356,929
Mezzanine investment income, net		6,870			—			20,553			—
Income from unconsolidated real estate partnerships		277			288			629			591
(Loss) income before income tax benefit		(26,562	)		874			19,507			363,319
Income tax benefit		1,747			3,096			7,859			1,942
Net (loss) income		(24,815	)		3,970			27,366			365,261
Noncontrolling interests:
Net loss (income) attributable to noncontrolling interests in consolidated real estate partnerships		154			58			153			(103	)
Net income attributable to preferred noncontrolling interests in Aimco Operating Partnership		(1,687	)		(1,933	)		(5,415	)		(5,800	)
Net loss (income) attributable to common noncontrolling interests in Aimco Operating Partnership		1,341			(116	)		(1,134	)		(18,787	)
Net income attributable to noncontrolling interests		(192	)		(1,991	)		(6,396	)		(24,690	)
Net (loss) income attributable to Aimco		(25,007	)		1,979			20,970			340,571
Net income attributable to Aimco preferred stockholders		—			—			—			(7,335	)
Net (income) loss attributable to participating securities		(39	)		24			(125	)		(431	)
Net (loss) income attributable to Aimco common stockholders	$	(25,046	)	$	2,003		$	20,845		$	332,805

Net (loss) income attributable to Aimco per common share – basic and diluted	$	(0.17	)	$	0.01		$	0.14		$	2.26

Weighted average common shares outstanding – basic		148,544			148,434			148,532			147,474
Weighted average common shares outstanding – diluted		148,544			148,636			148,628			147,692

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
Net (loss) income	$	(24,815	)	$	3,970		$	27,366		$	365,261
Unrealized losses on available for sale debt securities		(243	)		(402	)		(658	)		(325	)
Comprehensive (loss) income		(25,058	)		3,568			26,708			364,936
Comprehensive income attributable to noncontrolling interests		(177	)		(1,967	)		(6,354	)		(24,671	)
Comprehensive (loss) income attributable to Aimco	$	(25,235	)	$	1,601		$	20,354		$	340,265

See notes to condensed consolidated financial statements.

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APARTMENT INVESTMENT AND MANAGEMENT COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

For the Three Months Ended September 30, 2020 and 2019

(In thousands)

(Unaudited)

	Common Stock							Accumulated									Noncontrolling Interests in			Common Noncontrolling Interests in
	Shares Issued		Amount		Additional Paid- in Capital			Other Comprehensive Income (Loss)			Distributions in Excess of Earnings			Total Aimco Equity			Consolidated Real Estate Partnerships			Aimco Operating Partnership			Total Equity
Balances at June 30, 2019		148,827	$	1,488	$	3,498,629		$	4,866		$	(1,741,765	)	$	1,763,218		$	(2,718	)	$	82,366		$	1,842,866
Redemption of Aimco Operating Partnership units		57		1		2,820			—			—			2,821			—			(3,647	)		(826	)
Amortization of share-based compensation cost		—		—		1,163			—			—			1,163			—			795			1,958
Effect of changes in ownership for consolidated entities		—		—		(5,104	)		—			—			(5,104	)		2,315			2,789			—
Contribution from noncontrolling interest in consolidated real estate partnerships		—		—		—			—			—			—			4,911			—			4,911
Purchase of noncontrolling interest in consolidated real estate partnerships		—		—		—			—			—			—			(2,863	)		—			(2,863	)
Change in accumulated other comprehensive income		—		—		—			(378	)		—			(378	)		—			(24	)		(402	)
Net income		—

Price	51.82	EPS	2
Shares	157	P/E	22
MCap	8,129	P/FCF	29
Net Debt	4,161	EBIT	496
TEV	12,291	TEV/EBIT	25
TTM 2019-09-30, in MM, except price, ratios

10-Q	2020-09-30	Filed 2020-11-02
10-Q	2020-06-30	Filed 2020-08-05
10-Q	2020-03-31	Filed 2020-05-11
10-K	2019-12-31	Filed 2020-02-24
10-Q	2019-09-30	Filed 2019-11-04
10-Q	2019-06-30	Filed 2019-08-09
10-Q	2019-03-31	Filed 2019-05-06
10-K	2018-12-31	Filed 2019-02-20
10-Q	2018-09-30	Filed 2018-11-05
10-Q	2018-06-30	Filed 2018-08-07
10-Q	2018-03-31	Filed 2018-05-08
10-K	2017-12-31	Filed 2018-03-01
10-Q	2017-09-30	Filed 2017-11-01
10-Q	2017-06-30	Filed 2017-08-02
10-Q	2017-03-31	Filed 2017-05-05
10-K	2016-12-31	Filed 2017-02-24
10-Q	2016-09-30	Filed 2016-10-28
10-Q	2016-06-30	Filed 2016-07-29
10-Q	2016-03-31	Filed 2016-04-29
10-K	2015-12-31	Filed 2016-02-29
10-Q	2015-09-30	Filed 2015-11-05
10-Q	2015-07-31	Filed 2015-07-31
10-Q	2015-03-31	Filed 2015-05-01
10-K	2014-12-31	Filed 2015-02-27
10-Q	2014-09-30	Filed 2014-10-31
10-Q	2014-06-30	Filed 2014-08-01
10-Q	2014-03-31	Filed 2014-05-02
10-K	2013-12-31	Filed 2014-02-21
10-Q	2013-09-30	Filed 2013-11-01
10-Q	2013-06-30	Filed 2013-08-02
10-Q	2013-03-31	Filed 2013-05-03
10-Q	2012-09-30	Filed 2012-11-02
10-Q	2012-06-30	Filed 2012-08-03
10-Q	2012-03-31	Filed 2012-05-07
10-K	2011-12-31	Filed 2012-02-23
10-Q	2011-09-30	Filed 2011-10-28
10-Q	2011-06-30	Filed 2011-08-01
10-Q	2011-03-31	Filed 2011-04-29
10-K	2010-12-31	Filed 2011-02-25
10-Q	2010-09-30	Filed 2010-11-01
10-Q	2010-06-30	Filed 2010-07-30
10-Q	2010-03-31	Filed 2010-05-03
10-K	2009-12-31	Filed 2010-02-26

8-K	2021-02-03	Officers, Exhibits
8-K	2020-12-23	Off-BS Arrangement, Exhibits
8-K	2020-12-21	Officers, Exhibits
8-K	2020-12-21	Exhibits
8-K	2020-12-16	Enter Agreement, Off-BS Arrangement, Exhibits
8-K	2020-12-15	Enter Agreement, Off-BS Arrangement, Exhibits
8-K	2020-12-15	Enter Agreement, M&A, Off-BS Arrangement, Shareholder Rights, Control, Officers, Amend Bylaw, Other Events, Exhibits
8-K	2020-12-15	Enter Agreement, M&A, Sale of Shares, Shareholder Rights, Control, Officers, Amend Bylaw, Other Events, Exhibits
8-K	2020-12-02	Regulation FD, Exhibits
8-K	2020-11-30	Other Events, Exhibits
8-K	2020-11-30
8-K	2020-11-30	Amend Bylaw, Other Events, Exhibits
8-K	2020-11-25
8-K	2020-11-25
8-K	2020-11-19
8-K	2020-11-18
8-K	2020-11-11
8-K	2020-11-05
8-K	2020-10-29
8-K	2020-10-21
8-K	2020-10-21
8-K	2020-09-22
8-K	2020-09-14
8-K	2020-08-03
8-K	2020-06-01
8-K	2020-05-07
8-K	2020-04-28
8-K	2020-04-20
8-K	2020-03-24
8-K	2020-02-28
8-K	2020-01-30
8-K	2020-01-28
8-K	2019-12-19
8-K	2019-12-11
8-K	2019-12-02
8-K	2019-11-12
8-K	2019-10-31
8-K	2019-09-30
8-K	2019-08-26
8-K	2019-08-01
8-K	2019-06-03
8-K	2019-05-02
8-K	2019-04-30
8-K	2019-04-15
8-K	2019-04-05
8-K	2019-03-22
8-K	2019-03-01
8-K	2019-02-20
8-K	2019-02-13
8-K	2019-02-03
8-K	2018-12-07
8-K	2018-11-06
8-K	2018-11-01
8-K	2018-09-24
8-K	2018-08-13
8-K	2018-08-02
8-K	2018-07-25
8-K	2018-07-25
8-K	2018-06-04
8-K	2018-05-07
8-K	2018-05-01
8-K	2018-04-30
8-K	2018-04-26
8-K	2018-04-16
8-K	2018-03-02
8-K	2018-02-22
8-K	2018-02-01

EX-31.1	aiv-ex311_8.htm
EX-31.2	aiv-ex312_11.htm
EX-31.3	aiv-ex313_9.htm
EX-31.4	aiv-ex314_6.htm
EX-32.1	aiv-ex321_7.htm
EX-32.2	aiv-ex322_10.htm

AIV 10Q Quarterly Report

Aimco Properties Earnings 2020-09-30