Paramount : First Quarter 2024 Supplemental Information

SUPPLEMENTAL OPERATING AND FINANCIAL DATA

For the quarter ended March 31, 2024

FORWARD-LOOKING STATEMENTS

This supplemental information contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words "assumes," "believes," "estimates," "expects," "guidance," "intends," "plans," "projects" and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and could materially affect actual results, performance or achievements. These factors include, without limitation, the ability to enter into new leases or renew leases on favorable terms; dependence on tenants' financial condition; the risk we may lose a major tenant or that a major tenant may be adversely impacted by market and economic conditions, including elevated inflation and interest rates; trends in the office real estate industry including telecommuting, flexible work schedules, open workplaces and teleconferencing; the uncertainties of real estate development, acquisition and disposition activity; the ability to effectively integrate acquisitions; fluctuations in interest rates and the costs and availability of financing; the ability of our joint venture partners to satisfy their obligations; the effects of local, national and international economic and market conditions and the impact of elevated inflation and interest rates on such market conditions; the effects of acquisitions, dispositions and possible impairment charges on our operating results; the negative impact of any future pandemic, endemic or outbreak of infectious disease on the U.S., regional and global economies and our tenants' financial condition and results of operations; regulatory changes, including changes to tax laws and regulations; and other risks and uncertainties detailed from time to time in our filings with the U.S. Securities and Exchange Commission. We do not undertake a duty to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

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TABLE OF CONTENTS

		Page
	Overview
	Company Profile	4
	Common Share Data	5
	Guidance & Assumptions	6
	Selected Financial Information
	Financial Highlights	7
	Consolidated Balance Sheets	8
	Consolidated Statements of Income	9
	Select Income Statement Data	10
	Funds From Operations ("FFO")	11
	Funds Available for Distribution ("FAD")	12
	Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate ("EBITDAre")	13
	Net Operating Income ("NOI")	14 - 15
	Same Store NOI (by Reportable Segment)	16 - 17
	Joint Ventures and Funds
	Consolidated Joint Ventures	18 - 21
	Unconsolidated Joint Ventures	22 - 25
	Real Estate Related Funds	26 - 29
	Debt and Capitalization Data
	Capital Structure	30
	Debt Analysis	31
	Debt Maturities	32
	Selected Property Data
	Portfolio Summary	33 - 35
	Top Tenants and Industry Diversification	36
	Leasing Activity	37
	Lease Expirations	38 - 40
	Capital Expenditures (Cash Basis)	41
	Research Coverage	42
	Definitions	43 - 44

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COMPANY PROFILE

Paramount Group, Inc. ("Paramount" or the "Company") is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.

MANAGEMENT

Albert Behler	Chairman, Chief Executive Officer and President
Wilbur Paes	Chief Operating Officer, Chief Financial Officer and Treasurer
Peter Brindley	Executive Vice President, Head of Real Estate
Gage Johnson	Senior Vice President, General Counsel and Secretary
Ermelinda Berberi	Senior Vice President, Chief Accounting Officer

BOARD OF DIRECTORS

Albert Behler	Director, Chairman of the Board
Thomas Armbrust	Director
Martin Bussmann	Director, Lead Independent Director, Chair of Nominating and Corporate Governance Committee
Karin Klein	Director
Peter Linneman	Director, Chair of Audit Committee
Katharina Otto-Bernstein	Director
Mark Patterson	Director
Hitoshi Saito	Director
Paula Sutter	Director
Greg Wright	Director, Chair of Compensation Committee

COMPANY INFORMATION

Corporate Headquarters	Investor Relations	Stock Exchange Listing	Trading Symbol
1633 Broadway	[e-mail]	New York Stock Exchange	PGRE
New York, NY 10019	[phone]
[phone]

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COMMON SHARE DATA

(unaudited)

						Three Months Ended
Share Price:		March 31, 2024		December 31, 2023		September 30, 2023			June 30, 2023			March 31, 2023
High	$	5.36	$	5.92	$	5.43	$	4.92	$	6.74
Low	$	4.21	$	4.06	$	4.20	$	4.10	$	3.90
Closing (end of period)	$	4.69	$	5.17	$	4.62	$	4.43	$	4.56
Dividends per common share	$	0.035	$	0.035	$	0.035	$	0.035	$	0.0775
Annualized dividends per common share	$	0.14	$	0.14	$	0.14	$	0.14	$	0.31
Dividend yield (on closing share price)		3.0%			2.7%			3.0%			3.2%			6.8%

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GUIDANCE

(unaudited and in thousands, except square feet, % and per share amounts)

			Full Year 2024
(Amounts per diluted share)		Low			High
Estimated net loss attributable to common stockholders	$	(0.10)	$	(0.04)
Our share of real estate depreciation and amortization		0.91			0.91
Estimated FFO (1)		0.81			0.87
Adjustments for non-core items (2)		(0.06)			(0.06)
Estimated Core FFO (1)(3)	$	0.75		$	0.81
Operating Assumptions:
Leasing Activity (square feet)		725,000			900,000
PGRE's share of Same Store Leased % (1) at year end		86.1%			88.1%
Decrease in PGRE's share of Same Store Cash NOI (1)		(5.5%)			(3.5%)
Decrease in PGRE's share of Same Store NOI (1)		(4.0%)			(2.0%)
Financial Assumptions (at share):
Estimated net loss	$	(24,000)	$	(10,000)
Depreciation and amortization		213,000			213,000
General and administrative expenses		64,500			62,500
Interest and debt expense, including amortization of deferred financing costs		142,500			139,500
Other, net (primarily non-cash gain on extinguishment of IPO related tax liability)		(13,000)			(13,000)
Fee and other income, net of income taxes		(33,000)			(34,000)
NOI (1)		350,000			358,000
Straight-line rent adjustments and above and below-market lease revenue, net		(19,500)			(21,500)
Cash NOI (1)	$	330,500	$	336,500

1. See page 43 for our definition of this measure.
2. Represents non-core items for the three months ended March 31, 2024, that are listed in the table on page 11. The Company is not making projections for non-core items that may impact its financial results for the remainder of 2024, which may include realized and unrealized gains or losses on real estate related fund investments, acquisition and transaction related costs and other items that are not included in Core FFO.
3. We are raising our Estimated Core FFO Guidance for the full year of 2024, which is reconciled above to estimated net loss attributable to common stockholders per diluted share in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The estimated net loss attributable to common stockholders per diluted share is not a projection and is being provided solely to satisfy the disclosure requirements of the U.S. Securities and Exchange Commission ("SEC"). Except as described above, these estimates reflect management's view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels and the earnings impact of the events referenced in our earnings release issued on May 1, 2024 and otherwise to be referenced during our conference call scheduled for May 2, 2024. These estimates do not include the impact on operating results from possible future property acquisitions or dispositions, or realized and unrealized gains and losses on real estate related fund investments. There can be no assurance that our actual results will not differ materially from the estimates set forth above.
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											FINANCIAL HIGHLIGHTS
(unaudited and in thousands, except per share amounts)
							Three Months Ended
SELECTED FINANCIAL DATA		March 31, 2024				March 31, 2023				December 31, 2023
	Net income (loss) per share - basic and diluted	$	0.05	$	0.01		$	(0.95)
					0.25
	Core FFO (1) per share - diluted	$	0.22	$		$	0.22
					89,091
	PGRE's share of Adjusted EBITDAre (1)	$	86,921	$		$	86,484
					89,800
	PGRE's share of Cash NOI (1)	$	88,977	$		$	86,227
					96,201
	PGRE's share of NOI (1)	$	93,583	$		$	90,153
						Same Store NOI (1)
	Same Store % Change	Same Store Cash NOI (1)
	Three Months Ended March 31, 2024 vs. March 31, 2023		(1.5%)				(3.5%)

PORTFOLIO STATISTICS (at PGRE's Share)

												% Change
												March 31, 2024	March 31, 2024
												vs.	vs.
Same Store Leased % (1)			March 31, 2024			December 31, 2023		March 31, 2023		December 31, 2023			March 31, 2023
New York	90.1%			90.2%	90.2%			(0.1%)			(0.1%)
San Francisco		85.5%			89.8%	93.7%			(4.3%)			(8.2%)
Weighted Average
	89.1%			90.1%	91.0%			(1.0%)			(1.9%)

1. See page 43 for our definition of this measure.

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CONSOLIDATED BALANCE SHEETS

(unaudited and in thousands)
			March 31, 2024			December 31, 2023
Assets:
Real estate, at cost:
Land	$	1,966,237	$	1,966,237
Buildings and improvements		6,278,863			6,250,379
			8,245,100			8,216,616
Accumulated depreciation and amortization		(1,524,078)			(1,471,819)
Real estate, net		6,721,022			6,744,797
Cash and cash equivalents		276,235			428,208
Restricted cash		171,776			81,391
Accounts and other receivables		16,048			18,053
Real estate related fund investments		-			775
Investments in unconsolidated real estate related funds		4,603			4,549
Investments in unconsolidated joint ventures		132,788			132,239
Deferred rent receivable		353,826			351,209
Deferred charges, net		107,407			108,751
Intangible assets, net		62,609			68,005
Other assets		83,411			68,238
Total assets	$	7,929,725	$	8,006,215
Liabilities:
Notes and mortgages payable, net	$	3,669,850	$	3,803,484
Revolving credit facility		-			-
Accounts payable and accrued expenses		115,038			114,463
Dividends and distributions payable		8,376			8,360
Intangible liabilities, net		26,026			28,003
Other liabilities		31,774			37,017
Total liabilities		3,851,064			3,991,327
Equity:
Paramount Group, Inc. equity		3,199,050			3,203,285
Noncontrolling interests in:
Consolidated joint ventures		480,542			413,925
Consolidated real estate related funds		103,886			110,589
Operating Partnership		295,183			287,089
Total equity		4,078,661			4,014,888
Total liabilities and equity	$	7,929,725	$	8,006,215

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						CONSOLIDATED STATEMENTS OF INCOME
(unaudited and in thousands, except per share amounts)
			Three Months Ended
		March 31, 2024			March 31, 2023		December 31, 2023
Revenues:
Rental revenue (1)	$	179,723	$	181,713	$	181,736
Fee and other income (1)		9,154			6,761			10,735
Total revenues		188,877			188,474			192,471
Expenses:
Operating		71,740			70,309			77,076
Depreciation and amortization		61,114			58,888			68,866
General and administrative		16,634			14,623			15,679
Transaction related costs		178			128			99
Total expenses		149,666			143,948			161,720
Other income (expense):
(Loss) income from real estate related fund investments		(43)			3,550			(59,341)		(2)
Income (loss) from unconsolidated real estate related funds		105			(178)			45		(3)
Loss from unconsolidated joint ventures		(1,346)			(5,762)			(207,160)
Interest and other income, net (1)		19,420			2,925			4,830
Interest and debt expense		(40,269)			(36,459)			(40,550)
Income (loss) before income taxes		17,078			8,602			(271,425)
Income tax expense		(347)			(288)			(302)
Net income (loss)		16,731			8,314			(271,727)
Less net (income) loss attributable to noncontrolling interests in:
Consolidated joint ventures		(5,206)			(5,641)			(4,585)
Consolidated real estate related funds		(762)			(823)			52,383		(2)
Operating Partnership		(898)			(121)			18,379
Net income (loss) attributable to common stockholders	$	9,865	$	1,729	$	(205,550)
Per diluted share
$	0.05	$	0.01	$	(0.95)

1. See page 10 for details.
2. Includes $60,947 of realized and unrealized losses on real estate mezzanine loan investments made by Fund X, of which our share, net of amounts attributable to noncontrolling interests, was $7,935.
3. Includes our share of non-cash real estate impairment losses aggregating $201,496 related to Market Center and 55 Second Street.
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SELECT INCOME STATEMENT DATA

(unaudited and in thousands)

Rental Revenue:

Property rentals

Tenant reimbursements

Straight-line rent adjustments

Amortization of above and below-market leases, net Lease termination income

Total rental revenue

Fee and Other Income:

Asset management

Property management

Acquisition, disposition, leasing and other

Total fee income

Other (primarily parking income and tenant requested services, including cleaning and overtime heating and cooling)

Total fee and other income

Interest and Other Income, net:

Three Months Ended

	March 31, 2024					March 31, 2023			December 31, 2023
$	157,595	$	158,463	$	156,246
	16,990					14,458				19,637
	2,854					7,756				3,569
	1,340					1,036				1,447
	944					-				837
$	179,723	$	181,713	$	181,736
			Three Months Ended
	March 31, 2024					March 31, 2023			December 31, 2023
$	2,305			$	2,175		$	4,115
	1,744					1,862				1,775
	2,199					520				1,601
	6,248					4,557				7,491
						2,204				3,244
	2,906
$	9,154	$	6,761	$	10,735
			Three Months Ended
	March 31, 2024					March 31, 2023			December 31, 2023

Interest income, net	$	3,983			$	2,925		$	4,830
Non-cash gain on extinguishment of IPO related tax liability		15,437				-			-
Total interest and other income, net	$	19,420	$	2,925	$	4,830

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