Exhibit 12
Statements re: computation of ratio of earnings to combined fixed charges and preferred
distributions
(Dollars in Thousands) 
 
 
For the nine months ended September 30,
 
For the year ended December 31,
 
 
 
2018
 
2017
 
2016
 
2015
 
2014
 
2013
 
Net income (loss) from continuing operations
 
$
1,304

 
$
(4,939
)
 
$
(3,698
)
 
$
3,596


$
(5,902
)
(1)
$
1,527

 
Add: fixed charges and preferred and senior common distributions
 
27,788

 
35,459

 
35,075

 
35,871

 
33,592

 
31,506

 
Less: preferred and senior common distributions
 
(8,503
)
 
(10,876
)
 
(7,656
)
 
(5,101
)
 
(4,636
)
 
(4,394
)
 
Earnings
 
$
20,589

 
$
19,644

 
$
23,721

 
$
34,366

 
$
23,054

 
$
28,639

 
Fixed charges and preferred and senior common distributions:
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense (2)
 
$
18,172

 
$
22,855

 
$
25,472

 
$
28,802

 
$
27,284

 
$
25,314

 
Amortization of deferred financing fees
 
1,103

 
1,715

 
1,932

 
1,955

 
1,656

 
1,780

 
Estimated interest component of rent
 
10

 
13

 
15

 
13

 
16

 
18

 
Preferred and senior common distributions
 
8,503

 
10,876

 
7,656

 
5,101

 
4,636

 
4,394

 
Total fixed charges and preferred and senior common distributions
 
$
27,788

 
$
35,459

 
$
35,075

 
$
35,871

 
$
33,592

 
$
31,506

 
Ratio of earnings to combined fixed charges and preferred distributions
 
N/A

(3)
N/A
(4)
N/A
(5)
N/A
(6)
N/A
(7)
N/A

(8)
 
(1)
We recognized a $14.2 million impairment loss and a $5.3 million gain on debt extinguishment as a result of our Roseville, MN deed-in-lieu transaction during the year ended December 31, 2014.
(2)
Interest expense includes dividends paid on our mandatorily redeemable term preferred stock. We fully redeemed our mandatorily redeemable term preferred stock during the year ended December 31, 2016.
(3)
For the nine months ended September 30, 2018, earnings, as defined, were insufficient to cover fixed charges and preferred and common distributions by $7,199.
(4)
For the year ended December 31, 2017, earnings, as defined, were insufficient to cover fixed charges and preferred and common distributions by $15,815.
(5)
For the year ended December 31, 2016, earnings, as defined, were insufficient to cover fixed charges and preferred and common distributions by $11,354.
(6)
For the year ended December 31, 2015, earnings, as defined, were insufficient to cover fixed charges and preferred and common distributions by $1,505.
(7)
For the year ended December 31, 2014, earnings, as defined, were insufficient to cover fixed charges and preferred and common distributions by $10,538.
(8)
For the year ended December 31, 2013, earnings, as defined, were insufficient to cover fixed charges and preferred and common distributions by $2,867.
N/A: Not Applicable
The calculation of the ratio of earnings to combined fixed charges and preferred distributions is above. “Earnings” consist of net income from continuing operations and before fixed charges. “Fixed charges” consist of interest expense, amortization of deferred financing fees and the portion of operating lease expense that represents interest. The portion of operating lease expense that represents interest is calculated by dividing the amount of rent expense allocated to us by our Administrator as part of the administration fee payable under the Administration Agreement, by three, for the years ended December 31, 2013 to 2017 and for the nine months ended September 30, 2018.