BINGHAM FARMS, Mich., April 28 /PRNewswire/ -- Malan Realty Investors,
Inc. (NYSE: MAL), a self-administered real estate investment trust (REIT),
today announced total funds from operations (FFO) increased 11 percent in the
first quarter of 2000.
For the quarter ended March 31, 2000, FFO was $2.6 million or 50 cents per
basic share vs. $2.3 million or 45 cents per basic share for the quarter ended
March 31, 1999. FFO on a diluted basis (assuming conversion of convertible
debt securities and inclusion of other common stock equivalents) was
$4.2 million or 46 cents per share in the first quarter of 2000 vs.
$4.0 million or 43 cents per share in the first quarter of 1999. Total
revenues (excluding gains on sales of property), consisting primarily of rent
and recoveries from tenants, were $11.0 million in the first quarter of 2000
and in the first quarter of 1999.
Included in FFO for the first quarter of 2000 are nonrecurring revenues
from lease termination agreements of $197,000 and a settlement of additional
percentage rents from prior years of $195,000, offset by expenses of $50,000
incurred through March 31, 2000 in connection with a shareholder proxy
contest.
FFO for each year has been computed in accordance with the October 1999
White Paper issued by the National Association of Real Estate Investment
Trusts (NAREIT), which includes in FFO those items from nonrecurring events,
except for those that are defined as extraordinary items under generally
accepted accounting principles, and gains and losses from sales of depreciable
operating property. FFO for 1999 also has been restated to reflect a
previously announced change in the company's method of accounting for
contingent (percentage) rents applied retroactively to January 1, 1999
pursuant to SEC Staff Accounting Bulletin No. 101 issued in December 1999.
"We are pleased to report our twelfth consecutive increase in quarterly
comparative FFO. This record reflects the benefits of an improved portfolio
and the wisdom of deploying capital conservatively during this difficult real
estate market," said Malan President and Chief Executive Officer Anthony S.
Gramer. "We have embarked on a number of activities intended to sustain this
growth in future years, improve our financial position and enhance shareholder
value."
The company has nearly completed the lease up of approximately 70,000
square feet of new retail space at Pine Ridge Plaza in Lawrence, Kansas. In
addition to Old Navy, which will occupy 22,000 square feet of gross leasable
area (GLA), OfficeMax will lease approximately 23,000 square feet. Gramer
said that Malan is in negotiations with a major national retailer for the
remaining 15,000 square feet. When this second phase of the redevelopment is
completed, Pine Ridge Plaza will total approximately 260,000 square feet of
GLA.
"Despite having to divert significant attention during recent weeks to the
proxy contest being staged by Kensington, as well as having to expend
resources on this matter that could be better utilized on real estate
operations, we are diligently working to improve the portfolio through
redevelopment and expansion projects, lease buyouts, new leasing programs and
asset sales," said Gramer. "Malan is committed to enhancing the value of our
company for all shareholders through these actions. In addition, the board of
directors continues to actively work with Prudential Securities Incorporated
regarding a wide variety of strategic alternatives to enhance shareholder
value."
Malan also announced the formation of its new Internet website. Investors
can track the latest company developments or make inquiries via email by going
to http://www.malanreit.com .
Malan Realty Investors, Inc. owns, acquires, redevelops and manages
properties that are leased primarily to national and regional retail
companies. The company owns a portfolio of 65 properties located in 9 states
that contains an aggregate of approximately 6.0 million square feet of gross
leasable area. The company currently has 5.2 million common shares
outstanding.
Safe Harbor Statement: Certain statements in this release regarding
anticipated operating results are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Although the
company believes the statements and projections are based upon reasonable
assumptions, actual results may differ from those projected. Key factors that
could cause actual results to differ materially include economic downturns,
successful and timely completion of acquisitions, renovations and development
programs, leasing activities and other risks associated with the commercial
real estate business, and as detailed in the company's filings from time to
time with the Securities and Exchange Commission.
News releases for Malan Realty Investors are available through Company
News On-Call by fax at 800-758-5804, ext. 114165, or http://www.prnewswire.com .
MALAN REALTY INVESTORS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
Three Months March 31,
2000 1999
Revenues
Minimum rent $7,461 $7,682
Percentage and overage rents 519 245
Recoveries from tenants 2,787 2,984
Interest and other income 262 87
Gain on sale of real estate 0 1,751
Total Revenues 11,029 12,749
Expenses
Property operating and maintenance 944 1,170
Other operating expenses 380 368
Real estate taxes 2,074 2,158
General and administrative 572 545
Depreciation and amortization 1,632 1,579
Total Operating Expenses 5,602 5,820
Operating Income 5,427 6,929
Interest Expense 4,479 4,438
Net income before extraordinary item
and cumulative effect of
change in accounting principle 948 2,491
Extraordinary Item:
Loss on extinguishment of debt 0 (459)
Net income before cumulative effect
of change in accounting principle 948 2,032
Cumulative Effect of Change in
Accounting Principle 0 (522)
Net Income $948 $1,510
Basic and diluted earnings per share
before extraordinary item and
cumulative change in accounting
principle: $0.18 $0.48
Basic and diluted earnings per share
before cumulative change in
accounting principle: $0.18 $0.39
Basic and diluted earnings per share $0.18 $0.29
Depreciation and Amortization:
Depreciation of buildings and
improvements $1,545 $1,507
Amortization of tenant allowances
and improvements 47 38
Amortization of leasing costs 39 33
Gain on sale of real estate 0 (1,751)
Loss on extinguishment of debt 0 459
Cumulative effect of change in
accounting principle 0 522
Funds From Operations, Basic 2,579 2,318
Interest expense on convertible
securities 1,589 1,641
Amortization of deferred financing
costs on convertible securities 69 71
Funds From Operations, Diluted $4,237 $4,030
Funds From Operations Per Share:
Basic $0.50 $0.45
Diluted $0.46 $0.43
Weighted average shares outstanding:
Basic 5,173 5,169
Diluted 5,173 5,174
Diluted, assuming conversion of
convertible securities 9,275 9,405
SOURCE Malan Realty Investors, Inc.
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Related links:
http://www.malanreit.com
CONTACT:
Michael K. Kaline, Vice President of Malan
Realty Investors, Inc., 248-644-7110, or Fred Nachman of Marjan
Communications Inc., 312-867-1771, for Malan Realty Investors,
Inc.
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