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CMCT - CIM Commercial Trust Corp
$4.27
-0.03(-0.70%)6:18:23 PM 3/23/2023
CIM Commercial is a real estate investment trust that primarily acquires, owns, and operates Class A and creative office assets in vibrant and improving metropolitan communities throughout the United States (including improving and developing such assets). Its properties are primarily located in Los Angeles and the San Francisco Bay Area. CIM Commercial is operated by affiliates of CIM Group, L.P., a vertically-integrated owner and operator of real assets with multi-disciplinary expertise and in-house research, acquisition, credit analysis, development, finance, leasing, and onsite property management capabilities.

Financials

Quarterly financials
(USD)Sep 2022Q/Q
Revenue8MM-13%
Operating Income-45K-101%
Operating Expenses8MM-
Net Income-237K-108%
G&A1.9MM+52%
Amortization5.1MM+2%
Interest Expense2.2MM-9%

Revenue Breakdowns

The above Revenue Breakdowns and below Management Discussion contents are extracted from this specific SEC Edgar 10-K/10-Q filling. The process is fully automated and without human validation. Although we make every effort getting the relevant information, please be advised that We make no representation or warranties of any kind about completeness, accuracy, reliability, suitability or availability of the information exacted from Edgar 10-K/10-Q filings.

Highlights of Management DIscussion and Risk Factors in 10-K/10-Q filling

Positive
1.
We believe that the critical mass of redevelopment in such areas creates positive externalities, which enhance the value of real estate assets in the area.
2.
We believe that the critical mass of redevelopment in such areas creates positive externalities, which enhance the value of real estate assets in the area.
3.
CIM Group believes that the critical mass of redevelopment in such Qualified Communities creates positive externalities, which enhance the value of real estate assets in the area.
4.
Hotel Revenue: Hotel revenue increased to $25.8 million, or by 138.4%, for the nine months ended September 30, 2022, compared to $10.8 million for the nine months ended September 30, 2021, primarily due to an increase in occupancy and 48Table of Contentsaverage daily rate during the nine months ended September 30, 2022 as compared to the nine months ended September 30, 2021 as a result of the hospitality industry recovering from the impact of COVID-19.
5.
These communities are located in areas that include traditional downtown areas and suburban main streets, which have high barriers to entry, high population density, positive population trends and a propensity for growth.
6.
We believe that these assets will provide greater returns than similar assets in other markets, as a result of the population growth, public commitment and significant private investment that characterize these areas.
7.
We believe that these assets will provide greater returns than similar assets in other markets, as a result of the population growth, public commitment and significant private investment that characterize these areas.
8.
Hotel Revenue: Hotel revenue increased to $8.5 million, or by 54.4%, for the three months ended September 30, 2022, compared to $5.5 million for the three months ended September 30, 2021, primarily due to an increase in occupancy and average daily rate during the third quarter of 2022 as compared to the third quarter of 2021 as a result of the hospitality industry recovering from the impact of COVID-19.
9.
These communities are located in areas that include traditional downtown areas and suburban main streets, which 39Table of Contentshave high barriers to entry, high population density, positive population trends and a propensity for growth.
10.
At the initial closing of the co-investment, the Company expects to receive proceeds from co-investors, which proceeds will enhance the liquidity of the Company.
11.
These areas, which include traditional downtown areas and suburban main streets, generally have high barriers to entry, high population density, positive population trends, a propensity for growth and support for investment.
12.
Office revenue increased to $42.2 million, or by 5.9%, for the nine months ended September 30, 2022 compared to $39.9 million for the nine months ended September 30, 2021.
13.
Office revenue increased to $14.0 million, or by 8.0%, for the three months ended September 30, 2022 compared to $13.0 million for the three months ended September 30, 2021.
14.
CIM Group has extensive in-house research, acquisition, credit analysis, development, finance, leasing and onsite property management capabilities, which leverage its deep understanding of metropolitan communities to position properties for multiple uses and to maximize operating income.
15.
The increase is primarily due to increased rental revenue at an office property in Austin, Texas as a result of higher rental rates and higher occupancy and an increase in rental revenues at an office property in Los Angeles, California and an office property in Beverly Hills, California, both as a result of increased occupancy.
16.
All of these commitments have government guarantees of 75% (as the government guarantee has now reverted to 75% from 90%) and we believe that we will be able to sell the guaranteed portion of these loans in a liquid secondary market upon fully funding these loans.
17.
The increase is primarily due to increased rental revenue at an office property in Austin, Texas and an office property in Los Angeles, California as a result of higher occupancy, partially offset by lower rental revenues at an office property in San Francisco, California as a result of lower occupancy when compared to the nine months ended September 30, 2021.
Negative
1.
Additionally, decreased demand and other negative trends or unforeseeable events that impair our ability to timely renew or re lease space could have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations or to maintain our level of distributions on our Common Stock or Preferred Stock.
2.
Lending revenue decreased to $8.0 million, or by 47.1%, for the nine months ended September 30, 2022, compared to $15.1 million for the nine months ended September 30, 2021.
3.
Lending revenue decreased to $2.4 million, or by 59.2%, for the three months ended September 30, 2022, compared to $5.8 million for the three months ended September 30, 2021.
4.
Asset Management and Other Fees to Related Parties: Asset management fees and other fees to related parties, which have not been allocated to our operating segments, were $916,000 for the three months ended September 30, 2022, a decrease of 59.5%, compared to $2.3 million for the three months ended September 30, 2021.
5.
Asset Management and Other Fees to Related Parties: Asset management fees and other fees to related parties, which have not been allocated to our operating segments, were $2.8 million for the nine months ended September 30, 2022, a decrease of 59.3%, compared to $6.8 million for the nine months ended September 30, 2021.
6.
If we cannot obtain funding for our long-term liquidity needs, our assets may generate lower cash flows or decline in value, or both, which may cause us to sell assets at a time when we would not otherwise do so which could have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations or to maintain our level of distributions on our Common Stock or Preferred Stock.
7.
The decrease was primarily due to a decrease in lending segment net operating income of $3.7 million, a decrease in office segment net operating income of $994,000 and an increase in general and administrative expenses of $600,000.
8.
The decrease is primarily due to lower premium income as a result of lower loan sale volume and a reduction in the market premium achieved during the nine months ended September 30, 2022, compared to the nine months ended September 30, 2021.
9.
The decrease is primarily due to lower premium income as a result of lower loan sale volume and a reduction in the market premium achieved during the three months ended September 30, 2022, compared to the three months ended September 30, 2021.
10.
Since then, COVID-19 has spread worldwide, causing significant disruptions to the U.S. and world economies.
11.
Additionally, the spread of COVID-19 in the United States and the resulting restrictions on travel, meetings and social gatherings that have been implemented from time to time have impacted, and may continue to impact, the operations of our hotel in Sacramento, California.
12.
Such amounts are included in, and have the effect of increasing, net loss attributable to common stockholders and FFO attributable to common stockholders, because redeemable preferred stock redemptions are not an adjustment prescribed by NAREIT.FFO attributable to common stockholders was $(6.6) million for the three months ended September 30, 2022, a decrease of $8.4 million compared to $1.8 million for the three months ended September 30, 2021.
13.
The lower loan origination volume was primarily the result of the SBA temporarily increasing the guaranteed percentages of SBA 7(a) loan originations during the comparable period in 2021, while these factors were partially offset by acceleration of income-recognition from any principal discounts recorded on our loans due to increased prepayment.
14.
The lower loan origination volume was primarily the result of the SBA temporarily increasing the guaranteed percentages of SBA 7(a) loan originations during the comparable period in 2021, while these factors were partially offset by acceleration of income-recognition from any principal discounts recorded on our loans due to increased prepayment.
15.
Such amounts are included in, and have the effect of increasing, net loss attributable to common stockholders and FFO attributable to common stockholders, because redeemable preferred stock redemptions are not an adjustment prescribed by NAREIT.47Table of ContentsFFO attributable to common stockholders was $(1.8) million for the nine months ended September 30, 2022, a decrease of $1.3 million compared to $(465,000) for the nine months ended September 30, 2021.
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