CLEVELAND, Feb. 28, 2005 (PRIMEZONE) -- Paragon Real Estate Equity and Investment Trust (AMEX:PRG) announced operating results for the twelve months ended December 31, 2004. Net loss attributable to common share holders decreased to $816,000, or $0.02 per share, compared to a net loss of $1,090,000, or $0.06 per share, for the same period of 2003.
For the year ended December 31, 2004, Paragon's continuing operations include twelve months of Richton Trail Apartments, whereas in the same period ended December 31, 2003, Richton Trail is included for only six months because it was acquired on July 1, 2003. In addition, the 2003 net loss included non-comparable items for loss from discontinued operations of the commercial properties of $458,000 that were sold in October 2003 and gain on sale of marketable securities of $136,000. When properties are sold, their operating revenue and expenses are reclassified to "discontinued operations."
The company continues to actively pursue its value-added investment strategy and has been analyzing several portfolios. James C. Mastandrea, Chief Executive Officer and President, commented, "We have been reviewing value-added business opportunities in the apartment industry. With capital generally being available for real estate deals, we remain optimistic of achieving our objectives to make value-added acquisitions."
Paragon Real Estate Equity and Investment Trust and Subsidiaries
Consolidated Statements of Operations
For the twelve months ended
December 31,
---------------------------
2004 2003
----------- -----------
Revenues
Rental revenue $ 609,389 $ 287,762
Interest and other 50,639 18,986
---------------------------------------------------------------
Total revenues 660,028 306,748
---------------------------------------------------------------
Expenses
Property operating, taxes,
insurance 346,337 149,205
Depreciation and amortization 87,105 56,869
Interest 166,487 66,013
General and administrative 958,311 951,367
---------------------------------------------------------------
Total expenses 1,558,240 1,223,454
---------------------------------------------------------------
Loss from operations before
minority interests (898,212) (916,706)
Loss allocated to minority
interests 81,988 148,609
---------------------------------------------------------------
Loss from operations (816,224) (768,097)
Gain on sale of marketable
securities -- 136,358
---------------------------------------------------------------
Loss from continuing operations (816,224) (631,739)
Loss from discontinued
operations (1) -- (457,874)
---------------------------------------------------------------
Net loss attributable to Common
Shareholders (816,224) (1,089,613)
---------------------------------------------------------------
Net loss attributable to Common
Shareholders per Common Share:
Basic and Diluted ($0.02) ($0.06)
---------------------------------------------------------------
Weighted average number of
Common Shares outstanding:
Basic and Diluted (2) 32,993,966 18,171,689
===============================================================
(1) The company sold its interest in four commercial properties on
10/1/03. Revenues and expenses for those properties were
reclassified to discontinued operations for 2003. Revenues and
expenses from operations for 2004 and 2003 are for an apartment
complex purchased on 7/1/03.
(2) The weighted average number of common shares increased in 2004
due to the one-time incentive exchange offer, which ended on
6/30/03, providing for each preferred share to be exchanged for
22.881 common shares. Preferred shareholders exchanged 1,174,120
preferred shares, or nearly 81%, of the outstanding preferred for
26,865,042 common shares.
Paragon Real Estate Equity and Investment Trust and Subsidiaries
Consolidated Balance Sheet
As of
December 31, 2004
-----------------
ASSETS
Investments in real estate, net $3,895,046
Cash and restricted cash 1,905,548
Marketable securities, net 89,948
Other assets, net 124,567
----------
Total Assets $6,015,109
----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Mortgage loan payable $2,763,272
Other liabilities 318,324
----------
Total Liabilities 3,081,596
Minority interests in consolidated subsidiary 2,167,509
Shareholders' equity 766,004
----------
Total Liabilities and Shareholders' Equity $6,015,109
----------
Forward-Looking Statements
Certain matters discussed within this press release may be deemed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Paragon Real Estate Equity and Investment Trust believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that the planned implementation of a national real estate acquisition, development and re-development strategy will be completed in whole or in part. Factors that could cause actual results to differ materially from Paragon's expectations include changes in local or national economic or real estate conditions, the ability to meet competition, loss of existing key personnel, ability to hire and retain future personnel and other risks detailed from time to time in Paragon's SEC reports and filings, including its annual report on Form 10-K, quarterly reports on Form 10-Q and periodic reports on Form 8-K. Paragon assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.