Cousins Properties Inc. (CUZ), a real estate investment trust (REIT), reported fourth quarter 2010 FFO (fund from operations) of $10.0 million or 10 cents per share, compared with $7.3 million or 7 cents in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation, amortization and other non-cash expenses to net income.
Excluding certain non-recurring items, recurring FFO for the reported quarter was $16.5 million or 16 cents per share. The recurring FFO for fourth quarter 2010 exceeded the Zacks Consensus Estimate by 3 cents.
For full year 2010, Cousins Properties reported FFO of $32.8 million or 32 cents per share, compared with FFO loss of $92.0 million or $1.40 in the previous year. Recurring FFO for the reported fiscal was $49.4 million or 49 cents per share.
Total revenues were $56.2 million during the quarter versus $63.1 million in the year-ago period. Total revenues for the reported quarter were well ahead of the Zacks Consensus Estimate of $37 million. For full year 2010, Cousins Properties reported total revenues of $228.5 million versus $214.5 million in 2009.
During the quarter, Cousins Properties executed strong leasing activities spanning 491,000 square feet of space, bringing the tally to 3.0 million square feet for full year 2010. Total leased space during 2010 increased 41% for the office properties, 18% for retail and 16% for industrial compared to 2009. At year-end 2010, the company’s office portfolio was 91% leased (up from 87% at year-end 2009), while its retail and industrial buildings were 86% (84% in 2009) and 96% (51% in 2009) leased, respectively.
Cousins Properties obtained a new $36.6 million mortgage loan secured by The Avenue East Cobb, an open-air shopping center in Georgia. In addition, the company modified and extended its mortgage loan secured by Terminus 100 property, thereby reducing the principal balance by $40 million and the interest rate from 6.13% to 5.25%, and extending the maturity to January 1, 2023.
Cousins Properties is currently shoring up its balance sheet and increasing liquidity by selling non-core assets. At the same time, the company remains focused on leasing activities and intends to maintain steady occupancy levels across its portfolio. Cousins Properties sold $27.7 million of non-strategic assets during the quarter, bringing the tally for 2010 to $172.8 million. During the quarter, the company invested $14.9 million in a joint venture with Watkins Retail Group that owns four Publix-anchored shopping centers in Florida and Tennessee.
At year-end 2010, Cousins Properties had cash and cash equivalents of $7.6 million, compared with $9.5 million at year-end 2009. We maintain our ‘Neutral’ rating on Cousins Properties, which presently has a Zacks #4 Rank translating into a short-term ‘Sell’ recommendation. We also have a ‘Neutral’ recommendation and a Zacks #3 Rank (short-term ‘Hold’) for Duke Realty Corp. (DRE), one of the competitors of Cousins Properties.
COUSIN PROP INC (CUZ): Free Stock Analysis Report
DUKE REALTY CP (DRE): Free Stock Analysis Report
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