Regency Beats Estimates - Analyst Blog
August 06 2012 - 6:15AM
Zacks
Regency Centers
Corporation (REG),a real estate investment trust
(REIT),reported second quarter 2012 FFO (funds from operations) of
$61.3 million or 68 cents per share, compared with $55.1 million or
61 cents in the year-earlier quarter.
Reported FFO per share beat the
Zacks Consensus Estimate by 6 cents. Excluding non-recurring items,
recurring FFO for the reported quarter stood at $62.5 million or 69
cents per share versus $50.5 million or 56 cents in the year-ago
period.
The company reported total revenue
of $129.8 million in the second quarter of 2012, compared with
$124.6 million in the year-ago quarter.
During the reported quarter,
same-store net operating income (NOI) excluding termination fees
increased 3.6% on a year-over-year basis, with rental rate
growth of 2.1% (cash basis for spaces vacant less than 12 months).
Regency executed a total of 542 new and renewal lease transactions
during the quarter, spanning 1.6 million square feet. The
same-store portfolio of the company was 94.0% leased at the end of
the quarter.
Regency sold two wholly-owned and
two co-investment operating properties during the quarter for $99.0
million at a weighted average cap rate of 7.8%. The company also
sold three land parcels for $2.9 million. Subsequent to
quarter-end, Regency sold two co-investment operating properties
for $39.9 million at a cap rate of 8.1%. During the reported
quarter, Regency and a co-investment partner purchased a property
for $13.8 million at a cap rate of 8.3%.
Subsequent to the end of the
reported quarter, Regency closed the sale of a 15-property
portfolio to an affiliate of Blackstone Real Estate Partners VII
for $321.0 million, at a weighted average cap rate of 8.1%. The
company will maintain a $47.5 million preferred equity investment
in the portfolio, which will earn an annual return of 10.5%.
As of June 30, 2012, Regency had 11
projects under development with estimated development cost of
$282.3 million. Additionally, the company also had three
redevelopment projects in the pipeline with development costs
of $13.3 million.
Subsequent to the end of the
quarter, Regency used proceeds from its asset sale to repay
$150 million balance on the $250 million unsecured term loan
and retained the option of drawing the remaining $100 million by
January 2013 .
At the quarter end, Regency had
cash and cash equivalents of about $23.0 million and total debt of
$2.1 billion. For full year 2012, Regency revised its FFO guidance
from the earlier range of $2.30 -$2.42 to $2.30 - $2.36 per share
and recurring FFO from the previous range of $2.42- $2.54 to the
range of $2.42 - $2.48 per share.
Regency currently retains a Zacks
#3 Rank, which translates into a short-term Hold rating. We
maintain our long-term Neutral recommendation on the stock. One of
its competitors, DDR Corp (DDR) also holds a Zacks
#3 Rank.
Note: Fund from operations, a
widely used metric to gauge the performance of REITs, is obtained
after adding depreciation and amortization and other non-cash
expenses to net income.
DDR CORP (DDR): Free Stock Analysis Report
REGENCY CTRS CP (REG): Free Stock Analysis Report
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