Item 2. Properties
Item 2. Properties
The following table sets forth certain information related to operating properties in which we have an ownership interest. Except as noted, all information presented is as of December 31, 2021 ($ in thousands):
Operating Properties (1)
Company's Share
Office Properties Rentable Square Feet Financial Statement Presentation Company's Ownership Interest End of Period Leased Weighted Average Occupancy (2) % of Total
Net Operating
Income (3) Property Level Debt (4) Annualized Rent (5)
Spring & 8th (6) 765,000 Consolidated 100% 100.0% 100.0% 6.3% $ —
Terminus (6) 1,226,000 Consolidated 100% 90.6% 81.4% 6.1% 187,431
Northpark (6) 1,539,000 Consolidated 100% 87.1% 85.7% 5.7% —
725 Ponce (7) 372,000 Consolidated 100% 100.0% 99.0% 3.9% —
3344 Peachtree 484,000 Consolidated 100% 97.7% 95.3% 3.3% —
Buckhead Plaza (6) 666,000 Consolidated 100% 87.0% 76.7% 3.3% —
Avalon (8) 480,000 Consolidated 90% 99.5% 83.7% 2.9% —
Promenade Tower (fka Promenade) 777,000 Consolidated 100% 75.5% 73.4% 2.2% 89,011
Promenade Central (fka 1200 Peachtree) 370,000 Consolidated 100% 100.0% 100.0% 1.9% —
3348 Peachtree 258,000 Consolidated 100% 89.9% 90.1% 1.3% —
Emory University Hospital Midtown 358,000 Unconsolidated 50% 98.2% 94.3% 0.9% 32,283
Meridian Mark Plaza 160,000 Consolidated 100% 100.0% 100.0% 0.9% —
3350 Peachtree 413,000 Consolidated 100% 52.5% 49.1% 0.8% —
120 West Trinity Office (7) 43,000 Unconsolidated 20% 90.4% 87.2% 0.1% —
ATLANTA 7,911,000 89.1% 84.9% 39.6% 308,725
The Domain (8) 1,899,000 Consolidated 100% 100.0% 96.9% 11.0% 75,522
One Eleven Congress 519,000 Consolidated 100% 84.6% 84.6% 3.5% —
The Terrace (6) 619,000 Consolidated 100% 86.9% 85.4% 3.5% —
San Jacinto Center 399,000 Consolidated 100% 95.6% 93.5% 3.5% —
Colorado Tower 373,000 Consolidated 100% 100.0% 100.0% 3.3% 111,701
Domain Point (6) 240,000 Consolidated 96.5% 96.6% 83.3% 1.2% —
Research Park V 173,000 Consolidated 100% 97.1% 97.1% 0.8% —
AUSTIN 4,222,000 95.5% 92.9% 26.8% 187,223
Corporate Center 1,227,000 Consolidated 100% 95.7% 96.0% 6.2% —
Heights Union (6) (7) (9) 294,000 Consolidated 100% 93.0% 57.6% 1.1% —
The Pointe 253,000 Consolidated 100% 90.5% 87.8% 1.0% —
Harborview Plaza 205,000 Consolidated 100% 80.2% 77.9% 0.7% —
TAMPA (10) 1,979,000 93.1% 92.6% 9.0% —
Fifth Third Center 692,000 Consolidated 100% 94.4% 94.4% 3.8% 133,358
The RailYard (7) 329,000 Consolidated 100% 98.2% 96.8% 2.6% —
550 South (fka NASCAR Plaza) 394,000 Consolidated 100% 97.9% 97.7% 2.2% —
CHARLOTTE 1,415,000 96.3% 95.9% 8.6% 133,358
Hayden Ferry (6) 792,000 Consolidated 100% 94.6% 94.6% 5.2% —
Tempe Gateway 264,000 Consolidated 100% 78.1% 78.1% 1.3% —
111 West Rio 225,000 Consolidated 100% 100.0% 100.0% 1.2% —
PHOENIX 1,281,000 1281000 92.2% 92.2% 7.7% —
Legacy Union One 319,000 Consolidated 100% 100.0% 100.0% 2.1% 66,718
5950 Sherry Lane 197,000 Consolidated 100% 77.2% 79.3% 0.9% —
DALLAS 516,000 91.3% 92.1% 3.0% 66,718
BriarLake Plaza - Houston (6) 835,000 Consolidated 100% 79.9% 80.5% 3.6% —
Carolina Square - Chapel Hill 158,000 Unconsolidated 50% 98.5% 94.1% 0.4% 22,392
OTHER OFFICE 993,000 81.5% 81.7% 4.0% 22,392
TOTAL OFFICE (10) 18,317,000 91.5% 89.0% 98.7% $ 718,416 $ 687,665
Table continued on next page
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Company's Share
Office Properties Rentable Square Feet Financial Statement Presentation Company's Ownership Interest End of Period Leased Weighted Average Occupancy (2) % of Total
Net Operating
Income (3) Property Level Debt (4) Annualized Rent (5)
Other Properties
Carolina Square Apartment - Chapel Hill
(246 units) (7) 266,000 Unconsolidated 50% 100.0% 98.4% 0.5% $ 37,699
Carolina Square Retail - Chapel Hill (7) 44,000 Unconsolidated 50% 89.8% 87.1% 0.1% 6,236
College Street Garage - Charlotte (7) NA Consolidated 100% NA NA 0.5% —
120 West Trinity Apartment - Atlanta (330 Units) (7) 310,000 Unconsolidated 20% 98.8% 96.3% 0.2% —
TOTAL OTHER (10) 620,000 98.6% 96.6% 1.3% $ 43,935 $ 6,178
TOTAL (10) 18,937,000 91.6% 89.1% 100.0% $ 762,351 $ 693,843
(1) Operating properties exclude properties on our development pipeline and properties sold as of and prior to December 31, 2021.
(2) The weighted average economic occupancy of the property over the period for which the property was available for occupancy during the three months ended December 31, 2021.
(3) The Company's share of net operating income for the three months ended December 31, 2021.
(4) The Company's share of property-specific mortgage debt, including premiums and net of unamortized loan costs, as of December 31, 2021.
(5) The Company's share of annualized rent represents the sum of the annualized rent including tenant's share of estimated operating expenses, if applicable, each tenant is paying as of the end of the reporting period. If a tenant is not paying rent due to a free rent concession, annualized rent is calculated based on the annualized contractual rent the tenant will pay in the first period it is required to pay rent. Included in this a mount is $17.6 million of annuali zed base rent for tenants in a free rent period.
(6) Contains two or more buildings that are grouped together for reporting purposes.
(7) Not included in Same Property as of December 31, 2021.
(8) Contains two or more buildings that are grouped together for reporting purposes, some of which are not included in Same Property as of December 31, 2021.
(9) Heights Union is a recently developed property acquired by Cousins on October 1, 2021. The occupancy at December 31, 2021 is 57.6%, and stabilized occupancy of greater than 90% is anticipated to be achieved in the second quarter of 2022.
(10) The square footage of Heights Union has been excluded from the calculation of weighted average occupancy for the fourth quarter and leased at December 31, 2021. See note 9.
Office Lease Expirations
As of December 31, 2021, our leases expire as follows:
Year of Expiration Square Feet
Expiring (1) % of Leased
Space (1) Annual Contractual Rent (in thousands) (1) (2) % of Annual
Contractual
Rent (1) Annual
Contractual
Rent/Sq. Ft.
2022 969,877 6.5 % $ 38,589 4.9 % $ 36.59
2023 1,411,701 8.8 % 61,528 7.9 % 43.58
2024 1,099,401 6.9 % 49,081 6.3 % 43.82
2025 1,985,274 12.3 % 89,147 11.4 % 44.90
2026 1,446,994 9.0 % 69,375 8.9 % 47.84
2027 1,657,712 10.3 % 72,945 9.3 % 43.75
2028 1,169,744 7.4 % 59,438 7.6 % 49.50
2029 1,427,546 8.9 % 71,289 9.1 % 49.61
2030 1,276,508 7.9 % 80,763 10.3 % 63.27
2031 & Thereafter 3,480,984 22.0 % 190,344 24.3 % 53.88
Total 15,925,741 100.0 % $ 782,499 100.0 % $ 48.49
(1) Company's share of leases expiring after December 31, 2021. Expiring square footage for which new leases have been executed is reflected based on the expiration date of the new lease.
(2) Annual Contractual Rent is the estimated rent in the year of expiration. It includes the minimum base rent and an estimate of the tenant's share of operating expenses, if applicable, as defined in the respective leases.
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Top 20 Office Tenants
As of December 31, 2021, our top 20 office tenants were as follows:
Tenant (1) Number of Properties Occupied Number of Markets Occupied Company's Share of Square Footage Company's Share of Annualized Rent (in thousands) (2) Percentage of Company's Share of Annualized Rent Weighted Average Remaining Lease Term (Years)
1 NCR Corporation 1 1 762,090 $ 35,974 5.2% 11.6
2 Amazon 4 3 692,474 33,996 4.9% 7.1
3 Meta Platforms (fka Facebook) 1 1 422,252 22,477 3.4% 8.2
4 Expedia 1 1 430,547 22,071 3.2% 6.8
5 Pioneer Natural Resources Company 2 1 359,660 21,697 3.2% 9.7
6 Bank of America 2 2 344,601 11,741 1.8% 3.9
7 Apache Corporation 1 1 210,012 9,271 1.3% 2.8
8 Norfolk Southern 1 1 370,286 9,077 1.3% —
9 Wells Fargo Bank, Na 4 3 198,376 8,775 1.3% 4.0
10 Ovintiv USA (3) 1 1 318,582 8,069 1.2% 5.5
11 Allstate 2 2 214,380 7,750 1.1% 5.7
12 SVB Financial Group 1 1 188,940 7,624 1.1% 4.1
13 ADP 1 1 225,000 7,597 1.1% 6.3
14 WeWork Companies 4 2 169,050 7,422 1.1% 11.8
15 Regus Equity Business Centers 6 4 158,740 7,407 1.1% 6.0
16 Westrock Shared Service 1 1 205,185 7,162 1.0% 8.3
17 Workrise Technologies 1 1 93,210 6,578 1.0% 6.6
18 McGuirewoods 2 2 187,119 6,499 0.9% 4.9
19 BlackRock 1 1 131,656 6,415 0.9% 14.4
20 Samsung Engineering America 1 1 133,860 6,196 0.8% 4.9
Total 5,816,020 $ 253,798 36.9% 6.9
(1) In some cases, the actual tenant may be an affiliate of the entity shown.
(2) Annualized Rent represents the annualized rent including tenant's share of estimated operating expenses, if applicable, paid by the tenant as of December 31, 2021. If the tenant is in a free rent period as of December 31, 2021, Annualized Rent represents the annualized contractual rent the tenant will pay in the first month it is required to pay full rent.
(3) Ovintiv USA Inc. has multiple subleases for substantially all of its space. In the event of termination of the Ovintiv lease, such subleases would become direct leases with the Company.
Note: This schedule includes leases that have commenced. Leases that have been signed but have not commenced are excluded.
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Tenant Industry Diversification
As of December 31, 2021, our tenant industry diversification was as follows:
Industry (1) Percentage of Company's Share of Annualized Rent (2)
Technology 23.0 %
Professional Services 15.7 %
Financial 15.0 %
Legal 9.2 %
Energy 7.0 %
Consumer Goods & Services 6.8 %
Health Care 6.1 %
Real Estate 4.5 %
Other 3.6 %
Insurance 3.4 %
Marketing/Media/Creative 2.1 %
Construction/Design 2.1 %
Transportation 1.5 %
Total 100 %
(1) Management uses SIC codes when available, along with judgment, to determine tenant industry classification.
(2) Annualized Rent represents the annualized rent including tenant's share of estimated operating expenses, if applicable, paid by the tenant as of the date of this report. If the tenant is in a free rent period as of the date of this report, Annualized Rent represents the annualized contractual rent the tenant will pay in the first month it is required to pay full rent.
Development Pipeline (1)
As of December 31, 2021, information on our projects under development was as follows ($ in thousands):
Project Type Market Company's Ownership Interest Construction Start Date Square Feet/Units Estimated Project Cost (1) (2) Company's Share of Estimated Project Cost (2) Project Cost Incurred to Date (2) Company's Share of Project Cost Incurred to Date (2) Percent Leased Initial Revenue Recognition(3)
300 Colorado Office Austin 100 % 4Q18 369,000 $ 193,000 $ 193,000 $ 163,839 $ 163,839 88 % 1Q21
100 Mill Office Phoenix 90 % 1Q20 287,000 153,000 137,700 119,584 107,626 81 % 1Q22
Neuhoff (4) Mixed Nashville 50 % 3Q21 562,500 281,300 131,315 65,658
Commercial 448,000 — % 2Q23
Apartments 542 — % 2Q24
Domain 9 Office Austin 100 % 2Q21 338,000 147,000 147,000 48,359 48,359 97 % 1Q24
Total $ 1,055,500 $ 759,000 $ 463,097 $ 385,481
(1) This schedule shows projects currently under active development through the substantial completion of construction as well as properties in an initial lease up period prior to stabilization. Amounts included in the estimated project cost column are the estimated costs of the project through stabilization. Significant estimation is required to derive these costs, and the final costs may differ from these estimates.
(2) Estimated and incurred project costs are construction costs plus financing costs on project-specific debt. Neuhoff has a project-specific construction loan, and 300 Colorado had a project-specific loan that was paid off concurrent with the purchase of our partners' 50% interest in December 2021. The above excludes any financing cost assumptions for projects without project-specific debt and any other incremental capitalized costs required by GAAP. They also exclude fair value adjustments for legacy TIER projects that were recorded as a result of the 2019 merger.
(3) Initial revenue recognition represents the quarter within which the Company recognized or estimates it will begin recognizing revenue under GAAP.
(4) The Neuhoff estimated project cost will be funded with a combination of $250.6 million of equity contributed by the joint venture partners, followed by a $312.7 million construction loan.
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Land Holdings
As of December 31, 2021, we owned the following land holdings, either directly or indirectly through joint ventures:
Market Company's Ownership Interest Financial Statement Presentation Total Developable Land (Acres) Cost Basis of Land (in thousands)
3354/3356 Peachtree Atlanta 95% Consolidated 3.2
715 Ponce Atlanta 50% Unconsolidated 1.0
887 West Peachtree (fka 901 West Peachtree) (1) Atlanta 100% Consolidated 1.6
The Avenue Forsyth-Adjacent Land Atlanta 100% Consolidated 10.4
Domain Point 3 Austin 90% Consolidated 1.7
Domain Central Austin 100% Consolidated 5.6
South End Station Charlotte 100% Consolidated 3.4
303 Tremont Charlotte 100% Consolidated 2.4
Legacy Union 2 & 3 Dallas 95% Consolidated 4.0
Victory Center Dallas 75% Unconsolidated 3.0
Corporate Center 5 & 6 (2) Tampa 100% Consolidated 14.1
Total 50.4 $ 175,487
Company's Share 48.6 $ 166,267
(1) Includes a long-term ground lease with future obligation to purchase.
(2) Corporate Center 5 is controlled through a long-term ground lease.