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Regency Centers Corporation ( REG - Analyst Report ) , a real estate investment trust (REIT), reported first quarter 2012 FFO (funds from operations) of $49.9 million or 55 cents per share, compared with $52.7 million or 61 cents in the year-earlier quarter. 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.
Reported FFO per share was in line the Zacks Consensus Estimate. Excluding non-recurring items, recurring FFO for the reported quarter stood at $56.2 million or 62 cents per share versus $51.0 million or 59 cents in the year-ago period.
The company reported total revenue of $127.4 million in the first quarter of 2012, compared with $124.3 million in the year-ago quarter.
During the reported quarter, same-store net operating income (NOI) excluding termination fees increased 4.2% on a year-over-year basis, with rental rate growth of 2.9% (cash basis for spaces vacant less than 12 months). Regency executed a total of 405 new and renewal lease transactions during the quarter, spanning 1.5 million square feet. The same-store portfolio of the company was 93.6% leased at the end of the quarter.
Regency sold 2 wholly-owned properties during the quarter for $23.1 million at a weighted average cap rate of 7.4%. The company also sold two land parcels for $7.4 million. Subsequent to quarter-end, Regency sold 2 co-investment operating properties for $80.5 million at a cap rate of 5.9%. During the reported quarter, Regency and a co-investment partner purchased Lake Grove Commons for $72.5 million at a cap rate of 5.6%.
At March 31, 2012, Regency had 10 projects under development with estimated development costs of $217.7 million. Additionally, the company also had six redevelopment projects in process with development costs of $29.8 million.
During the quarter, Regency drew $150 million on the $250 million closed unsecured term loan and retained the option of drawing the remaining $100 million by July 13, 2012.
At the quarter end, Regency had cash and cash equivalents of about $27.1 million and total debt of $2.0 billion. For full year 2012, Regency revised its FFO guidance from the range of $2.23 -$2.39 to $2.30 - $2.42 per share and recurring FFO from the range of $2.38- $2.52 to the range of $2.42 - $2.54 per share.
Regency currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, Simon Property Group Inc. ( SPG - Analyst Report ) holds a Zacks #1 Rank, which translates into a short- term Strong Buy rating.
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