Current Report Filing (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): August 6, 2020

Brookfield Property REIT Inc.

(Exact name of registrant as specified in its charter)

Delaware		001-34948		27-2963337
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

250 Vesey Street, 15th Floor, New York, NY		10281
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (212) 417-7000

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 (see General Instructions A.2.):

¨ 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))

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 Stock, par value $0.01 per share	BPYU	Nasdaq Global Select Market
6.375% Series A Cumulative Perpetual Redeemable Preferred Stock, par value $0.01 per share	BPYUP	Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act or Rule 12b-2 of the Exchange Act.

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. ¨

Item 2.02.

Results of Operations and Financial Condition.

On August 6, 2020 Brookfield Property REIT Inc. (the “Company”) disclosed the following financial information:

The following is the Company’s balance sheet as at June 30, 2020 and December 31, 2019.

Brookfield Property REIT Inc.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	June 30, 2020			December 31, 2019
	(Dollars in thousands, except share and per share amounts)
Assets:
Investment in real estate:
Land	$	3,725,551		$	3,659,595
Buildings and equipment		14,262,736			14,020,589
Less accumulated depreciation		(2,787,621	)		(2,569,911	)
Construction in progress		207,938			160,443
Net property and equipment		15,408,604			15,270,716
Investment in Unconsolidated Real Estate Affiliates		4,495,267			4,634,292
Net investment in real estate		19,903,871			19,905,008
Cash and cash equivalents		209,689			197,829
Accounts receivable, net		517,209			234,928
Notes receivable		42,041			76,310
Deferred expenses, net		173,375			188,591
Prepaid expenses and other assets		746,888			745,060
Deferred tax assets, net		623,022			625,660
Total assets	$	22,216,095		$	21,973,386
Liabilities:
Mortgages, notes and loans payable	$	16,600,275		$	15,902,894
Investment in Unconsolidated Real Estate Affiliates		130,958			125,565
Accounts payable and accrued expenses		1,006,741			1,027,130
Dividend payable		21			21
Junior subordinated notes		206,200			206,200
Total liabilities		17,944,195			17,261,810
Redeemable equity interests		1,172,745			1,354,234
Redeemable noncontrolling interests		61,837			62,235
Total redeemable interests		1,234,582			1,416,469
Equity:
Total stockholders' equity		1,578,756			1,762,367
Noncontrolling interests		1,458,562			1,532,740
Total equity		3,037,318			3,295,107
Total liabilities, redeemable interests and equity	$	22,216,095		$	21,973,386

The following is the Company’s income statement for the three and six months ended June 30, 2020 and June 30, 2019.

Brookfield Property REIT Inc.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
	(Dollars in thousands, except per share amounts)
Revenues:
Rental revenues, net	$	341,073		$	314,239		$	692,902		$	637,259
Management fees and other corporate revenues		26,565			38,050			61,903			79,238
Other		6,827			8,743			23,290			20,918
Total revenues		374,465			361,032			778,095			737,415
Operating Expenses:
Real estate taxes		48,656			42,374			96,463			83,229
Property maintenance costs		6,414			6,335			15,560			16,396
Marketing		1,641			921			2,405			1,825
Other property operating costs		37,262			41,076			87,083			84,498
Property management and other costs		57,524			59,247			118,499			115,301
General and administrative		5,002			5,320			9,892			10,733
Costs related to the BPY Transaction		—			840			—			9,179
Provision for impairment		71,455			184,347			71,455			184,347
Depreciation and amortization		162,896			118,382			320,242			237,181
Total operating expenses		390,850			458,842			721,599			742,689
Interest and dividend income		763			2,891			3,859			11,313
Interest expense		(163,964	)		(158,845	)		(342,766	)		(313,551	)
Gain on extinguishment of debt		14,320			—			14,320			—
Loss from changes in control of investment properties and other, net		(15,433	)		—			(15,433	)		—
Loss before income taxes, equity in loss of Unconsolidated Real Estate Affiliates and related gain on investment, and allocation to noncontrolling interests		(180,699	)		(253,764	)		(283,524	)		(307,512	)
Benefit from (provision for) income taxes		6,640			(3,503	)		1,212			(7,953	)
Equity in loss of Unconsolidated Real Estate Affiliates		(56,426	)		(7,838	)		(61,269	)		(15,711	)
Unconsolidated Real Estate Affiliates - (loss) gain on investment, net		(1,120	)		—			11,527			104,354
Net loss		(231,605	)		(265,105	)		(332,054	)		(226,822	)
Allocation to noncontrolling interests		22,555			37,885			41,177			31,252
Net loss attributable to Brookfield Property REIT Inc.	$	(209,050	)	$	(227,220	)	$	(290,877	)	$	(195,570	)

Item 7.01

Regulation FD Disclosure.

The Company’s board of directors has authorized the repurchase of up to the greater of 5% of the shares of Class A Stock that are issued and outstanding or 10% of the Class A Stock public float over the next 12 months as market conditions and the Company’s liquidity warrant. Repurchases may be made through open market purchases, privately negotiated transactions, structured or derivative transactions, including accelerated stock repurchase transactions, or other methods of acquiring shares and pursuant to Rule 10b5-1 of the Securities Act, from time to time as permitted by applicable securities laws and other legal requirements.

The information set forth in this Item 7.01 shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, nor shall it be deemed incorporated by reference in any filing by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

SIGNATURES

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