Colony Starwood Homes Announces Preliminary Financial and Operating Results for Quarter Ended December 31, 2015

– Expands Buyback Authorization to $250 Million –

– Provides Fourth Quarter Earnings Release and Conference Call Date –

SCOTTSDALE, Ariz.–(BUSINESS WIRE)–Colony Starwood Homes (NYSE:SFR) (the “Company”), a leading
single-family rental real estate investment trust (“REIT”), today
announced preliminary unaudited financial and operating results for the
three months and year ended December 31, 2015. The Company plans to
release its full financial results on February 29, 2016.

Additionally, the Company’s Board of Trustees (the “Board”) authorized a
$100 million increase and an extension to the Company’s share repurchase
program. The Company is now authorized to purchase up to $250 million of
its outstanding common shares through May 6, 2017, of which
approximately $242 million of capacity is currently available.

On January 5, 2016, the Company completed the merger between Starwood
Waypoint Residential Trust (“SWAY”) and Colony American Homes (“CAH”)
(the “Merger”) and the internalization of SWAY’s manager (the
“Internalization”), forming a company with a combined asset value of
approximately $7.7 billion and over 30,000 homes. In connection with the
merger, SWAY was renamed Colony Starwood Homes and began trading under
the ticker symbol “SFR” on the New York Stock Exchange.

“Given the current valuation of our shares, we are pre-announcing our
fourth quarter and full year 2015 results, which puts us in a position
to repurchase shares under an increased share repurchase program,” said
Fred Tuomi, the Company’s Chief Executive Officer. “Further, the
sizeable increase in our stabilized home portfolio created by the Merger
supports our intent to propose to the Board an increase in our annual
dividend to $0.88 per share, an increase of 14% from SWAY’s pre-Merger
rate.”

A summary of preliminary financial results for SWAY and CAH is provided
below:

   
SELECTED FINANCIAL RESULTS

(UNAUDITED)

 
Three Months Ended Year Ended
December 31, 2015 December 31, 2015
(in millions, except per share data) SWAY   CAH SWAY   CAH

Total revenue

$64.4 – 65.4 $80.4 – 81.4 $271.3 – 272.3 $303.2 – 304.2

Net loss attributable to common shareholders

$(29.2) – (26.0) $(13.8) – (11.8) $(43.8) – (40.6) $(37.3) – (35.3)
Core FFO as Adjusted $6.6 – 8.4 $22.3 – 24.1 $63.3 – 65.1 $66.1 – 67.9

Core FFO as Adjusted per common share

  $0.17 – 0.22       $1.67 – 1.72    
 

SWAY’s Preliminary Core FFO as Adjusted for the three months and year
ended December 31, 2015 excludes an expense of approximately $2.0
million and $0.9 million, respectively, for real estate taxes related to
prior periods. Results for CAH do not include results for Colony
American Finance, LLC, which was not acquired by the Company as part of
the Merger.

As of December 31, 2015, SWAY and CAH had aggregate cash and cash
equivalents of approximately $220 million and aggregate borrowings of
approximately $4.1 billion. The Company expects remaining transaction
expenses related to the Merger and the Internalization of approximately
$25 million to $30 million, which includes severance, retention and
other transaction-related expenses.

A summary of preliminary operating results for SWAY, CAH, and the
combined Company is provided below:

         

SELECTED OPERATING RESULTS

(UNAUDITED)

 
Three Months Ended
As of December 31, 2015   December 31, 2015
Combined   Combined
SWAY CAH Company SWAY CAH Company
SFR Portfolio Homes(1) 12,881 17,796 30,677
Average monthly rent per home(1) $1,510 $1,503 $1,506
Total portfolio occupancy(1)(2) 89.5% 94.9% 92.6%
Stabilized occupancy(1)(3) 93.2% 95.5% 94.6%
Renewal rent growth(1)(4) 3.5% 5.7% 4.9%
Replacement rent growth(1) 2.1% 4.1% 3.4%
Blended rent growth(1) 2.6% 5.0% 4.2%
Retention(1)               72.3%   76.8%   75.0%
 

(1) Excludes 1,218 and 106 homes SWAY and CAH did not intend to hold
for the long term as of December 31, 2015, respectively.
(2)
Represents number of homes occupied as of the last day of the period,
divided by total SFR portfolio homes.
(3) Occupied homes as of the
last day of the period divided by homes that are currently occupied or
have been occupied in prior periods.
(4) Renewal rent growth
includes rent growth from renewals and escalation clauses on multi-year
leases.

Earnings Release and Conference Call

The Company will release full financial results for the three months and
year ended December 31, 2015 before the market opens on February 29,
2016. A conference call will be held that same day at 11:00 a.m. Eastern
Time to review the Company’s results for the three months ended December
31, 2015, discuss recent events and conduct a question-and-answer
session.

Webcast:
A link to access the conference call will be
available in the investor relations section of the Company’s website at www.colonystarwood.com.
To listen to a live broadcast, go to the site at least 15 minutes
prior to the scheduled start time in order to register, download and
install any necessary audio software.

To Participate in the Telephone Conference Call:
Dial in at
least 5 minutes prior to start time:
Domestic: 1-877-407-4018
International:
1-201-689-8471

Conference Call Playback:
Domestic: 1-877-870-5176
International:
1-858-384-5517
Passcode: 13629574
The playback will be
available through March 29, 2016

About Colony Starwood Homes
Colony
Starwood Homes (NYSE: SFR) is one of the largest publicly traded owners
and operators of single-family rental homes in the United States. Colony
Starwood Homes acquires, renovates, leases, maintains and manages
single-family homes in markets that exhibit favorable demographics and
long-term economic trends, as well as strengthening demand for rental
properties. Colony Starwood Homes is building its business upon a
foundation of respect for its residents and the communities in which it
operates. Additional information can be found at www.colonystarwood.com.

Definitions and Reconciliations: NAREIT
FFO and Core FFO as Adjusted

Funds From Operations (“FFO”) as defined by the National Association of
Real Estate Investment Trusts (“NAREIT”) (“NAREIT FFO”) is used by
industry analysts and investors as a supplemental performance measure of
an equity REIT. NAREIT FFO is defined by NAREIT as net income or loss
(computed in accordance U.S. generally accepted accounting principles
(“GAAP”) excluding gains or losses from sales of previously depreciated
real estate assets, plus depreciation and amortization of real estate
assets and adjustments for unconsolidated partnerships and joint
ventures. The Company’s Core FFO as Adjusted begins with NAREIT FFO as
defined by the NAREIT White Paper and is adjusted for: non-cash items,
transaction related expenses and out of period items.

NAREIT FFO/Core FFO as Adjusted does not represent net income or cash
flows from operations as defined by GAAP and is not intended to indicate
whether cash flows will be sufficient to fund cash needs. It should not
be considered an alternative to net income as an indicator of the
Company’s operating performance or to cash flows as a measure of
liquidity. The Company’s NAREIT FFO/Core FFO as Adjusted may not be
comparable to the NAREIT FFO of other REITs due to the fact that not all
REITs use the NAREIT or similar Core FFO as Adjusted definition. For a
reconciliation of NAREIT FFO and Core FFO as Adjusted to net loss
attributable to the Company’s shareholders, please see below.

         
NAREIT FFO AND CORE FFO AS ADJUSTED

(UNAUDITED)

 
Three Months Ended December 31, 2015   Year Ended December 31, 2015
(in millions, except share and per share data) SWAY CAH SWAY CAH
(unaudited) (ranges) (unaudited) (ranges)
Reconciliation of net loss to NAREIT FFO, Core FFO and Core FFO
as Adjusted
(1)
 
Net loss attributable to common shareholders $ (29.2) $ (26.0) $ (13.8) $ (11.8) $ (43.8) $ (40.6) $ (37.3) $ (35.3)
 
Add (deduct) adjustments from net loss to derive NAREIT FFO:
Depreciation and amortization on real estate assets 21.3 20.8 28.2 27.8 78.0 77.5 108.5 108.1
Impairment and gain on sales of depreciated real estate investments (1.1) (1.3) 10.1 9.9 (3.3) (3.5) 10.7 10.5
Non-controlling interests 0.0 0.0 (6.5) (5.9) 0.3 0.3 (22.1) (21.5)
FFO adjustments from unconsolidated joint ventures

0.0

0.0

0.2 0.2
Subtotal – NAREIT FFO (1) $ (9.0) $ (6.5) $ 18.0 $ 20.0 $ 31.2 $ 33.7 $ 60.0 $ 62.0
Add (deduct) adjustments to NAREIT FFO to derive Core FFO:
Non-cash items (2) 5.9 5.4 0.0 0.0 19.2 18.7 0.2 0.2
Transaction-related expenses 7.7 7.5 3.5 3.3 12.0 11.8 5.9 5.7
Core FFO(1) $ 4.6 $ 6.4 $ 21.5 $ 23.3 $ 62.4 $ 64.2 $ 66.1 $ 67.9

Add (deduct) adjustments to Core FFO to derive Core FFO as
Adjusted for out of period items:

Real estate taxes and insurance (3)

2.0 2.0 0.8 0.8 0.9 0.9

Core FFO as Adjusted for out of period items (1) $ 6.6 $ 8.4 $ 22.3 $ 24.1 $ 63.3 $ 65.1 $ 66.1 $ 67.9
 
Weighted average shares – basic and diluted 37,972,792 37,933,431
 
Total Core FFO as Adjusted per common share $ 0.17 $ 0.22 $ 1.67 $ 1.72
 

(1) NAREIT FFO, Core FFO and Core FFO as Adjusted are non-GAAP
measures.
(2) For the three months and year ended December 31,
2015, SWAY non-cash interest excludes amortization of deferred financing
cost of approximately $2.1 million and $7.4 million, respectively. CAH
non-cash interest excludes amortization of deferred financing cost of
approximately $3.4 million and $16.0 million, respectively, for the same
periods.
(3) For the year ended December 31, 2015, SWAY recorded
$0.9 million of real estate tax expense which related to the year ended
December 31, 2014. In the three months ended December 31, 2015, SWAY
recorded $2.0 million of real estate tax expense which related to
periods prior to the three months ended December 31, 2015. These
adjustments were primarily the result of tax assessment increases from
the prior year by certain jurisdictions, and concentrated in the states
of Texas and Florida. The Company has excluded the impact of these
“out-of-period” tax expenses from results for the three months and year
ended December 31, 2015.

Important Notes Regarding Preliminary
Information

The Company’s management has prepared the preliminary estimates set
forth herein for the three months and year ended December 31, 2015 based
upon the most recent information available to the Company’s management
from the Company’s internal reporting procedures as of the date of this
release. The preliminary estimates set forth herein are preliminary,
unaudited, subject to further completion and reflect the Company’s
current good faith estimates, are subject to additional financial
closing procedures and may be revised as a result of the Company
management’s further review of SWAY’s and CAH’s results and any
adjustments that may result from the completion of the audits of the
fiscal 2015 financial statements. The Company and its auditors have not
completed their normal quarterly review or annual audit procedures as of
and for the three months and year ended December 31, 2015, and there can
be no assurance that SWAY’s and CAH’s final results for this quarterly
and annual period will not differ from these estimates. Any such changes
could be material. Accordingly, you should not place undue reliance on
these preliminary estimates. These estimates should not be viewed as a
substitute for full audited or interim financial statements prepared in
accordance with GAAP and are not necessarily indicative of the results
to be achieved for any future period. They should be read together with
the “Risk Factors” sections of the Company’s Definitive Proxy Statement
on Schedule 14A, filed on November 13, 2015 (the “Merger Proxy”), and
the Company’s Annual Report on Form 10-K for the year ended December 31,
2014. Factors that could cause these preliminary estimates to differ
include, but are not limited to discovery of new information that alters
expectations about fourth quarter and year end results or impacts
valuation methodologies underlying these results.

All future dividends are subject to the determination, in its sole
discretion, of the Board.

Forward-Looking Statements

This presentation may include “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. These
forward-looking statements, which are based on current expectations,
estimates and projections about the industry and markets in which the
Company operates and beliefs of and assumptions made by the Company’s
management, involve uncertainties that could significantly affect the
financial results of the Company. Words such as “may,” “will,” “should,”
“might,” “could,” “expects,” “anticipates,” “intends,” “plans,”
“believes,” “seeks,” “estimates,” “preliminary”, “potential,”
“continue,” “predicts,” variations of such words, the negative of such
words and similar expressions are intended to identify such
forward-looking statements, which generally are not historical in
nature. Such forward-looking statements include, but are not limited to,
statements about the anticipated benefits of the recently closed
business combination transaction involving the Company, including future
financial and operating results (such as NAREIT FFO and Core FFO), and
the Company’s plans, objectives, expectations and intentions. All
statements that address operating performance, events or developments
that we expect or anticipate will occur in the future — including
statements relating to expected synergies, improved liquidity and
balance sheet strength — are forward-looking statements. These
statements are not guarantees of future performance and involve certain
risks, uncertainties and assumptions that are difficult to predict.
Although we believe the expectations reflected in any forward-looking
statements are based on reasonable assumptions, we can give no assurance
that our expectations will be attained and therefore, actual outcomes
and results may differ materially from what is expressed or forecasted
in such forward-looking statements. Some of the factors that may affect
outcomes and results include, but are not limited to: (i) national,
regional and local economic climates; (ii) changes in financial markets
and interest rates, or to the business or financial condition of either
company or business; (iii) changes in market demand for single-family
rental homes and competitive pricing; (iv) risks associated with
acquisitions, including the integration of the combined companies’
businesses; (v) maintenance of REIT status; (vi) availability of
financing and capital; (vii) risks associated with achieving expected
revenue synergies or cost savings; and (viii) those additional risks and
factors discussed in reports filed with the Securities and Exchange
Commission by the Company from time to time, including those discussed
under the heading “Risk Factors” in its Merger Proxy and most recently
filed reports on Forms 10-K and 10-Q. Neither the Company nor any other
person assumes responsibility for the accuracy or completeness of any of
these forward-looking statements. You should not rely upon
forward-looking statements as predictions of future events. The
forward-looking statements speak only as of the date of this
communication, and the Company anticipates that subsequent events and
developments will cause their views to change.

Contacts

For Colony Starwood Homes:
Investor Relations
John
Christie, 510-982-5470
IR@colonystarwood.com
or
Media
Relations

Jason Chudoba, 646-277-1249
Jason.chudoba@icrinc.com