Form: 8-K

Current report

November 12, 2020


EXHIBIT 99.2






New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (unaudited)





New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)
Table of Contents
ItemPage
Non-GAAP Definitions3
Key Metrics6
Consolidated Balance Sheets7
Consolidated Statements of Operations8
Non-GAAP Measures9
Debt Overview11
Future Minimum Lease Rents12
Top Ten Tenants13
Diversification by Property Type14
Diversification by Tenant Industry15
Lease Expirations16
Please note that totals may not add due to rounding.

Forward-looking Statements:
This supplemental package of New York City REIT, Inc. (the “Company” or “NYC”) includes “forward looking statements.” These forward-looking statements involve substantial risks and uncertainties that could cause the outcome to be materially different. In addition, words such as “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “would,” or similar expressions indicate a forward-looking statement, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those contemplated by such forward-looking statements, including those set forth in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of NYC’s most recent Annual Report on Form 10-K and NYC’s most recent Form 10-Q, as such Risk Factors may be updated from time to time in subsequent reports. Further, forward-looking statements speak only as of the date they are made, and NYC undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, except as required by law.

2


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)
Non-GAAP Financial Measures
This section discusses the non-GAAP financial measures we use to evaluate our performance, including Funds from Operations (“FFO”), Core Funds from Operations (“Core FFO”), Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), Net Operating Income (“NOI”) and Cash Net Operating Income (“Cash NOI”). While NOI is a property-level measure, Core FFO is based on our total performance and therefore reflects the impact of other items not specifically associated with NOI such as, interest expense, general and administrative expenses and operating fees to related parties. A description of these non-GAAP measures and reconciliations to the most directly comparable GAAP measure, which is net income, is provided below. Adjustments for unconsolidated partnerships and joint ventures are calculated to exclude the proportionate share of the non-controlling interest to arrive at FFO, Core FFO and NOI attributable to stockholders.
Caution on Use of Non-GAAP Measures
FFO, Core FFO, Adjusted EBITDA, NOI and Cash NOI should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income or in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP measures.
Other REITs may not define FFO in accordance with the current National Association of Real Estate Investment Trusts (“NAREIT”), an industry trade group, definition (as we do), or may interpret the current NAREIT definition differently than we do, or may calculate Core FFO differently than we do. Consequently, our presentation of FFO and Core FFO may not be comparable to other similarly titled measures presented by other REITs.
We consider FFO and Core FFO useful indicators of our performance. Because FFO and Core FFO calculations exclude such factors as depreciation and amortization of real estate assets and gains or losses from sales of operating real estate assets (which can vary among owners of identical assets in similar conditions based on historical cost accounting and useful-life estimates), FFO and Core FFO presentations facilitate comparisons of operating performance between periods and between other REITs in our peer group.
As a result, we believe that the use of FFO and Core FFO, together with the required GAAP presentations, provide a more complete understanding of our performance, including relative to our peers and a more informed and appropriate basis on which to make decisions involving operating, financing, and investing activities. However, FFO and Core FFO are not indicative of cash available to fund ongoing cash needs, including the ability to pay cash dividends. Investors are cautioned that FFO and Core FFO should only be used to assess the sustainability of our operating performance excluding these activities, as they exclude certain costs that have a negative effect on our operating performance during the periods in which these costs are incurred.
Funds from Operations and Adjusted Funds from Operations
Funds from Operations
Due to certain unique operating characteristics of real estate companies, as discussed below, the NAREIT, an industry trade group, has promulgated a performance measure known as FFO, which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. FFO is not equivalent to net income or loss as determined under GAAP.
We calculate FFO, a non-GAAP measure, consistent with the standards established over time by the Board of Governors of NAREIT, as restated in a White Paper and approved by the Board of Governors of NAREIT effective in December 2018 (the “White Paper”). The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding depreciation and amortization related to real estate, gains and losses from sales of certain real estate assets, gain and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. Adjustments for consolidated partially-owned entities (including our Operating Partnership) and equity in earnings of unconsolidated affiliates are made to arrive at our proportionate share of FFO attributable to our stockholders. Our FFO calculation complies with NAREIT’s definition.
The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, and straight-line amortization of intangibles. We believe that, because real estate values historically rise and fall with market conditions, including inflation, interest rates, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation and certain other items may be less informative. Historical accounting for real estate involves the use of GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and amortization, among other things, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income.

3


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)
Core Funds from Operations
In calculating Core FFO, we start with FFO, then we exclude the impact of discrete non-operating transactions and other events which we do not consider representative of the comparable operating results of our real estate operating portfolio, which is our core business platform. Specific examples of discrete non-operating items include acquisition and transaction related costs for dead deals, debt extinguishment costs, listing related costs and expenses (including the vesting and conversion of Class B units and cash expenses and fees which are non-recurring in nature incurred in connection with the listing and related transactions), and non-cash equity-based compensation. We add back non-cash write-offs of deferred financing costs and prepayment penalties incurred with the early extinguishment of debt which are included in net income but are considered financing cash flows when paid in the statement of cash flows. We consider these write-offs and prepayment penalties to be capital transactions and not indicative of operations. By excluding expensed acquisition and transaction dead deal costs as well as non-operating costs, we believe Core FFO provides useful supplemental information that is comparable for each type of real estate investment and is consistent with management’s analysis of the investing and operating performance of our properties. In future periods, we may also exclude other items from Core FFO that we believe may help investors compare our results.
Adjusted Earnings before Interest, Taxes, Depreciation and Amortization, Net Operating Income and Cash Net Operating Income.
We believe that Adjusted EBITDA, which is defined as earnings before interest, taxes, depreciation and amortization adjusted for acquisition and transaction-related expenses, listing-related costs and expenses, other non-cash items such as the vesting and conversion of the Class B Units, equity-based compensation expense and including our pro-rata share from unconsolidated joint ventures, is an appropriate measure of our ability to incur and service debt. Adjusted EBITDA should not be considered as an alternative to cash flows from operating activities, as a measure of our liquidity or as an alternative to net income as an indicator of our operating activities. Other REITs may calculate Adjusted EBITDA differently and our calculation should not be compared to that of other REITs.
NOI is a non-GAAP financial measure used by us to evaluate the operating performance of our real estate. NOI is equal to total revenues, excluding contingent purchase price consideration, less property operating and maintenance expense. NOI excludes all other items of expense and income included in the financial statements in calculating net income (loss). We believe NOI provides useful and relevant information because it reflects only those income and expense items that are incurred at the property level and presents such items on an unleveraged basis. We use NOI to assess and compare property level performance and to make decisions concerning the operations of the properties. Further, we believe NOI is useful to investors as a performance measure because, when compared across periods, NOI reflects the impact on operations from trends in occupancy rates, rental rates, operating expenses and acquisition activity on an unleveraged basis, providing perspective not immediately apparent from net income (loss). NOI excludes certain items included in calculating net income (loss) in order to provide results that are more closely related to a property’s results of operations. For example, interest expense is not necessarily linked to the operating performance of a real estate asset. In addition, depreciation and amortization, because of historical cost accounting and useful life estimates, may distort operating performance at the property level. NOI presented by us may not be comparable to NOI reported by other REITs that define NOI differently. We believe that in order to facilitate a clear understanding of our operating results, NOI should be examined in conjunction with net income (loss) as presented in our consolidated financial statements. NOI should not be considered as an alternative to net income (loss) as an indication of our performance or to cash flows as a measure of our liquidity or our ability to pay dividends.
Cash NOI, is a non-GAAP financial measure that is intended to reflect the performance of our properties. We define Cash NOI as NOI excluding amortization of above/below market lease intangibles and straight-line adjustments that are included in GAAP lease revenues. We believe that Cash NOI is a helpful measure that both investors and management can use to evaluate the current financial performance of our properties and it allows for comparison of our operating performance between periods and to other REITs. Cash NOI should not be considered as an alternative to net income, as an indication of our financial performance, or to cash flows as a measure of liquidity or our ability to fund all needs. The method by which we calculate and present Cash NOI may not be directly comparable to the way other REITs present Cash NOI.




4


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)

Key Metrics
As of and for the three months ended September 30, 2020
Amounts in thousands, except per share data, ratios and percentages

Financial Results (Amounts in thousands, except per share data)
Revenue from tenants
$16,997 
Net loss attributable to common stockholders$(12,288)
Basic and diluted net loss per share attributable to common stockholders$(0.96)
Cash NOI [1]
$6,063 
Adjusted EBITDA [1]
$5,584 
Core FFO attributable to common stockholders [1]
$514 
Balance Sheet and Capitalization (Amounts in thousands, except ratios and percentages)
Gross asset value [2]
$1,010,373 
Net debt [3] [4]
$365,912 
Total consolidated debt [4]
$405,000 
Total assets
$877,955 
Cash and cash equivalents$39,088 
Common shares outstanding as of September 30, 2020 12,803 
Net debt to gross asset value36.2 %
Net debt to annualized adjusted EBITDA [1] (annualized based on quarterly results)
16.4 x
Weighted-average interest rate cost [5]
4.4 %
Weighted-average debt maturity (years) [6]
6.4 
Interest Coverage Ratio [7]
1.2 x
Real Estate Portfolio
Number of properties
Number of tenants
76 
Square footage (millions)
1.2 
Leased
88.6 %
Weighted-average remaining lease term (years) [8]
7.5
______
[1]  This Non-GAAP metric is reconciled below.
[2] Defined as total assets of $878.0 million plus accumulated depreciation and amortization of $132.4 million as of September 30, 2020.
[3]  Represents total debt outstanding of $405.0 million, less cash and cash equivalents of $39.1 million.
[4]  Excludes the effect of deferred financing costs, net.
[5] The weighted average interest rate cost is based on the outstanding principal balance of the debt.
[6]  The weighted average debt maturity is based on the outstanding principal balance of the debt.
[7] The interest coverage ratio is calculated by dividing adjusted EBITDA by cash paid for interest (interest expense less non-cash portion of interest expense and amortization of mortgage (discount) premium, net) for the quarter ended September 30, 2020.  Adjusted EBITDA and cash paid for interest are Non-GAAP metrics and are reconciled below.
[8] Based on annualized straight-line rent as of September 30, 2020.
5

New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020


Consolidated Balance Sheets
Amounts in thousands
September 30,
2020
December 31,
2019
ASSETS(Unaudited)
Real estate investments, at cost:
Land
$193,658 $193,658 
Buildings and improvements
568,134 565,829 
Acquired intangible assets
98,412 103,121 
Total real estate investments, at cost
860,204 862,608 
Less accumulated depreciation and amortization
(132,418)(114,322)
Total real estate investments, net
727,786 748,286 
Cash and cash equivalents39,088 51,199 
Restricted cash9,700 7,098 
Operating lease right-of-use asset
55,427 55,579 
Prepaid expenses and other assets (includes amounts due from related parties of $407 and $0 at September 30, 2020 and December 31, 2019, respectively) 11,080 8,602 
Straight-line rent receivable25,231 21,649 
Deferred leasing costs, net9,643 8,943 
Total assets
$877,955 $901,356 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Mortgage notes payable, net$396,188 $395,031 
Accounts payable, accrued expenses and other liabilities (including amounts due to related parties of $167 and $222 at September 30, 2020 and December 31, 2019, respectively)6,831 7,033 
Operating lease liability54,832 54,866 
Below-market lease liabilities, net14,517 18,300 
Derivative liability, at fair value3,722 1,327 
Deferred revenue5,490 4,250 
Total liabilities
481,580 480,807 
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none issued and outstanding at September 30, 2020 and December 31, 2019
— — 
Common stock, $0.01 par value, 300,000,000 shares authorized,12,802,690 and 12,755,099 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively129 128 
Additional paid-in capital686,690 686,026 
Accumulated other comprehensive loss(3,722)(1,327)
Distributions in excess of accumulated earnings(288,640)(264,278)
Total stockholders’ equity
394,457 420,549 
Non-controlling interests 1,918 — 
Total equity396,375 420,549 
Total liabilities and equity
$877,955 $901,356 
6


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Consolidated Statements of Operations
Amounts in thousands, except share and per share data


 Three Months Ended
September 30,
2020
June 30,
2020
March 31, 2020December 31,
2019
Revenue from tenants$16,997 $18,562 $17,477 $18,311 
 Expenses:
Asset and property management fees to related parties1,879 1,844 1,998 1,945 
Property operating8,300 7,217 8,016 8,526 
Acquisition, transaction and other costs— — — (5)
Listing expenses 1,299 — — — 
Vesting and conversion of Class B Units1,153 — — — 
Equity-based compensation1,711 24 23 22 
General and administrative1,234 2,497 1,996 1,417 
Depreciation and amortization8,639 7,912 7,519 8,390 
Total expenses
24,215 19,494 19,552 20,295 
Operating loss
(7,218)(932)(2,075)(1,984)
Other income (expense):
Interest expense(5,089)(4,995)(4,832)(4,847)
Other income19 641 119 161 
Total other expense, net
(5,070)(4,354)(4,713)(4,686)
Net loss attributable to common stockholders$(12,288)$(5,286)$(6,788)$(6,670)
Basic and Diluted Net Loss Per Share:
Net loss per share attributable to common stockholders — Basic and Diluted$(0.96)$(0.41)$(0.53)$(0.52)
Weighted average shares outstanding —Basic and Diluted12,772,176 12,750,066 12,749,724 12,749,665 

7


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Non-GAAP Measures
Amounts in thousands, except per share data


 Three Months Ended
September 30,
2020
June 30,
2020
March 31, 2020December 31,
2019
EBITDA:
Net loss$(12,288)$(5,286)$(6,788)$(6,670)
Depreciation and amortization8,639 7,912 7,519 8,390 
Interest expense5,089 4,995 4,832 4,847 
   EBITDA1,440 7,621 5,563 6,567 
   Acquisition and transaction related— — — (5)
   Listing expenses 1,299 — — — 
   Vesting and conversion of Class B Units1,153 — — — 
   Equity-based compensation1,711 24 23 22 
   Other income(19)(641)(119)(161)
   Adjusted EBITDA5,584 7,004 5,467 6,423 
Asset and property management fees to related parties1,879 1,844 1,998 1,945 
General and administrative1,234 2,497 1,996 1,417 
   NOI8,697 11,345 9,461 9,785 
   Accretion of below- and amortization of above-market lease liabilities and assets, net(555)(1,890)(362)(104)
   Straight-line rent (revenue as a lessor)(2,107)(784)(691)(1,012)
   Straight-line ground rent (expense as lessee)28 27 27 28 
  Cash NOI$6,063 $8,698 $8,435 $8,697 
Cash Paid for Interest:
   Interest expense$5,089 $4,995 $4,832 $4,847 
   Amortization of deferred financing costs(386)(403)(368)(385)
   Total cash paid for interest$4,703 $4,592 $4,464 $4,462 


8


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Non-GAAP Measures
Amounts in thousands, except per share data


 Three Months Ended
September 30,
2020
June 30, 2020 [1]
March 31,
2020
December 31,
2019
Funds from operations (FFO):
Net loss attributable to common stockholders$(12,288)$(5,286)$(6,788)$(6,670)
  Depreciation and amortization8,639 7,912 7,519 8,390 
FFO attributable to common stockholders(3,649)2,626 731 1,720 
  Acquisition and transaction related— — — (5)
  Listing expenses [2]
1,299 — — — 
  Vesting and conversion of Class B Units1,153 — — — 
  Equity-based compensation1,711 24 23 22 
Core FFO attributable to common stockholders$514 $2,650 $754 $1,737 
Weighted average common shares outstanding — Basic and Diluted12,772 12,750 12,750 12,750 
  Net loss per share attributable to common shareholders — Basic and Diluted$(0.96)$(0.41)$(0.53)$(0.52)
  FFO per common share$(0.29)$0.21 $0.06 $0.13 
  Core FFO per common share$0.04 $0.21 $0.06 $0.14 

________
[1] Included in Net loss, FFO and Core FFO for the three months ended June 30, 2020 is other income of approximately $0.6 million related to the recognition of income from the retention of a deposit forfeited by the potential buyer on the potential sale of the property commonly known as the HIT Factory pursuant to a purchase agreement which expired in April 2020.
[2] Listing expenses include financial advisory and other professional fees and other expenses incurred in connection with the listing of our Class A common stock on the NYSE in August 2020. These costs are non-recurring and are not part of the operations of our real estate portfolio as they were incurred only as a result of our decision to list our Class A common stock on the NYSE.

9


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Debt Overview
As of September 30, 2020
Amounts in thousands, except ratios and percentages

Year of MaturityNumber of Encumbered Properties
Weighted-Average Debt Maturity (Years) [1]
Weighted-Average Interest Rate [1] [2]
Total Outstanding Balance [3]
2020 (remainder)— — — %$— 
2021 — — — %— 
2022 — — — %— 
2023— — — %— 
20243.6 3.7 %55,000 
2025— — — %— 
Thereafter 5.9 4.5 %350,000 
Total Debt 7 6.4 4.4 %$405,000 

______
 
[1] Weighted based on the outstanding principal balance of the debt.
[2] All of the Company’s debt is fixed rate as of September 30, 2020.
[3] Excludes the effect of deferred financing costs, net. Current balances as of September 30, 2020 are shown in the year the debt matures.
 


10


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Future Minimum Lease Rents
As of September 30, 2020
Amounts in thousands

Future Minimum
Base Rent Payments
[1]
2020 (remainder)$14,411 
202159,032 
202255,583 
202347,742 
202447,591 
202539,922 
Thereafter221,260 
Total$485,541 
——

[1] Represents future minimum base rent payments on a cash basis due to the Company over the next five years and thereafter. These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes among other items.
11


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Top Ten Tenants
As of September 30, 2020
Amounts in thousands, except percentages

Tenant / Lease GuarantorProperty TypeTenant Industry
Annualized SL Rent [1]
SL Rent Percent
Remaining Lease Term [2]
Investment Grade [3]
City National BankOffice / RetailFinancial Services$4,356 %12.7 Yes
KnotelOfficeCo-working3,951 %8.3 No
Planned Parenthood Federation of America, Inc.OfficeNon-Profit3,337 %10.8 Yes
EquinoxRetailFitness2,836 %18.1 No
Cornell UniversityOfficeHealthcare Services2,476 %3.7 Yes
The City of New York - Dept. of Youth & Community DevelopmentOfficeGovernment/Public Administration2,255 %6.9 Yes
CVSRetailRetail2,161 %13.9 Yes
I Love NY GiftsRetailRetail2,041 %15.6 Yes
Waterfall Asset management LLCOfficeFinancial Services2,019 %1.9 No
USA General Services AdministrationOfficeGovernment/Public Administration1,954 %1.7 Yes
Subtotal    27,386 44 %9.8 
Remaining portfolio34,318 56 %
Total Portfolio    $61,704 100 %

——
[1] Calculated using the most recent available lease terms as of September 30, 2020.
[2] Based on straight-line rent as of September 30, 2020.
[3] As used herein, investment grade includes both actual investment grade ratings of the tenant or guarantor, if available, or implied investment grade. Implied investment grade may include actual ratings of tenant parent, guarantor parent (regardless of whether or not the parent has guaranteed the tenant’s obligation under the lease) or by using a proprietary Moody’s analytical tool, which generates an implied rating by measuring a company’s probability of default. Ratings information is as of September 30, 2020. Top 10 tenants are 56% actual investment grade rated and 12% implied investment grade rated.


12


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Diversification by Property Type
As of September 30, 2020
Amounts in thousands, except percentages


Total Portfolio
Property Type
Annualized SL Rent [1]
SL Rent PercentSquare FeetSq. ft. Percent
Office$47,040 76 %862 84 %
Retail 14,127 23 %168 16 %
Other 537 %— — %
Total $61,704 100 %1,030 100 %
 
——
[1] Calculated using the most recent available lease terms as of September 30, 2020.
13


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Diversification by Tenant Industry
As of September 30, 2020
Amounts in thousands, except percentages

Total Portfolio
Industry Type
Annualized SL Rent [1]
SL Rent PercentSquare FeetSq. ft. Percent
Financial Services$16,772 27 %207 20 %
Government/Public Administration 7,368 12 %173 17 %
Retail 6,796 11 %43 %
Non-profit 6,737 11 %146 14 %
Services4,999 %111 11 %
Healthcare Services4,452 %61 %
Co-working3,951 %71 %
Fitness3,376 %39 %
Professional Services2,021 %39 %
Technology1,946 %33 %
Other [2]
3,286 %107 10 %
Total $61,704 100 %1,030 100 %
 
——
[1] Calculated using the most recent available lease terms as of September 30, 2020.
[2] Other includes eight industry types as of September 30, 2020.
 


14


New York City REIT, Inc.
Supplemental Information
Quarter ended September 30, 2020 (Unaudited)


Lease Expirations
As of September 30, 2020

Year of ExpirationNumber of Leases Expiring
Annualized SL Rent [1]
Annualized SL Rent PercentLeased Rentable Square FeetPercent of Rentable Square Feet Expiring
(In thousands)(In thousands)
2020 (Remaining)3$1,172 %17 %
2021102,710 %67 %
2022146,768 11 %141 14 %
202393,150 %40 %
2024106,135 10 %98 10 %
2025127,147 12 %126 12 %
202631,028 %21 %
202752,943 %52 %
2028145,917 10 %98 10 %
202963,968 %71 %
203031,810 %34 %
203176,312 10 %118 11 %
2032— — %— — %
203354,356 %36 %
203422,161 %10 %
20353655 %%
Thereafter (>2035)65,472 %97 %
Total112$61,704 100 %1,030 100 %

——
[1] Calculated using the most recent available lease terms as of September 30, 2020.

15