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News Release

Federal Realty Investment Trust Announces Second Quarter 2005 Operating Results

ROCKVILLE, Md., Jul 28, 2005 (BUSINESS WIRE) -- Federal Realty Investment Trust (NYSE:FRT) today reported operating results for its second quarter ended June 30, 2005.

-- Funds from operations available for common shareholders (FFO) per diluted share was $0.77 and net income available for common shareholders per diluted share was $0.41 for the quarter ended June 30, 2005 versus $0.73 and $0.45 for second quarter 2004.

-- FFO per diluted share was $1.51 and net income available for common shareholders per diluted share was $0.81 for the six months ended June 30, 2005.

-- When compared to second quarter 2004, same-center property operating income increased 4.9% including redevelopments and expansions.

-- Rent increases on lease rollovers for retail space for which there was a prior tenant were 34% on a cash-basis and 51% on a GAAP-basis for the quarter ended June 30, 2005.

-- The Trust's portfolio was 95.0% leased as of June 30, 2005.

Financial Results

Federal Realty reported FFO of $41.2 million, or $0.77 per diluted share, in second quarter 2005. This compares to FFO of $38.6 million, or $0.73 per diluted share, reported in second quarter 2004, which included $1.0 million ($0.02 per diluted share) of insurance recovery for lost income from the Santana Row fire. For the six months ended June 30, 2005, Federal Realty reported FFO of $80.5 million, or $1.51 per diluted share. This compares to FFO of $73.4 million, or $1.42 per diluted share, for the same six-month period in 2004, which included $2.1 million ($0.04 per diluted share) of Santana Row insurance proceeds.

Net income available for common shareholders was $21.9 million, and net income available for common shareholders per diluted share was $0.41 for the quarter ended June 30, 2005, versus $23.5 million and $0.45, respectively, for the second quarter of 2004. Year-to-date, Federal Realty reported net income available for common shareholders of $43.1 million, or $0.81 per diluted share. This compares to net income available for common shareholders of $37.8 million, or $0.75 per diluted share, for the six months ended June 30, 2004.

FFO is a non-GAAP supplemental earnings measure which the Trust considers meaningful in measuring its operating performance. A reconciliation of FFO available for common shareholders and FFO per diluted share to net income available for common shareholders and net income available for common shareholders per diluted share, respectively, is attached to this press release.

Portfolio Results

On a same-center basis, including redevelopment and expansion properties, property operating income increased 4.9% over second quarter 2004. When redevelopment and expansion properties are excluded from the same-center results, property operating income increased 4.2% from second quarter 2004.

Overall, the Trust's portfolio was 95.0% leased as of June 30, 2005, compared to 94.2% on June 30, 2004. Federal Realty's same-center portfolio was 96.4% leased on June 30, 2005, compared to 96.7% on June 30, 2004.

During the second quarter of 2005, the Trust signed 84 leases for approximately 269,000 square feet of retail space. On a comparable space basis (i.e. spaces for which there was a former tenant), the Trust leased 241,000 square feet at a weighted-average cash-basis contractual rent increase per square foot (i.e. excluding the impact of straight-line rents) of 34%. The weighted-average contractual rent on this comparable space for the first year of the new lease is $30.43 per square foot compared to the weighted-average contractual rent of $22.63 per square foot for the last year of the prior lease. The previous weighted-average contractual rent is calculated by including both the minimum rent and the percentage rent actually paid during the last year of the lease term for the re-leased space. On a GAAP basis (i.e. including the impact of straight-line rents), rent increases per square foot for comparable retail space averaged 51% for the second quarter of 2005. As of June 30, 2005, Federal Realty's weighted-average contractual rent for retail and commercial space in its portfolio is $18.43 per square foot.

"Aggressive management of the portfolio, the strong rent increases on lease rollovers we have achieved over the past two years, and effective execution of the Trust's large redevelopment pipeline were essential components of our strong second quarter performance," commented Donald Wood, Federal Realty's President and Chief Executive Officer. "We also continue to create and capture value at Santana Row, as initial occupancy of the first apartment units in Building Seven occurred in the second quarter, and closings on the first condominium units are anticipated to occur in the current quarter."

At Santana Row, Federal Realty's mixed-use community in San Jose, Calif., 93% of the retail space was leased to 104 tenants, with 100 stores open and operating as of June 30, 2005. As previously announced, Federal Realty is pursuing the potential sale of up to 219 residential condominiums in Buildings Three, Four and Six at Santana Row. Through July 24, 2005, the Trust currently has 43 units under contract, and expects initial closings to commence in Building Four in August 2005. Initial occupancy of the 256 residential rental units on the podium of Building Seven commenced in April 2005, with 71 units leased as of July 24, 2005, and lease-up expected to continue through mid-2006.

Guidance

Federal Realty today reconfirmed guidance for 2005 FFO per diluted share to a range of $3.03 to $3.05, and increased guidance for 2005 net income available for common shareholders per diluted share to a range of $1.47 to $1.49.

Summary of Other Quarterly Activities and Recent Developments

-- June 6, 2005 - Federal Realty declared a regular quarterly cash dividend of $0.555 per common share, resulting in an indicated annual rate of $2.22 per share, an increase of $0.20 per share annualized. The dividend increase represents the largest dividend increase in Federal Realty's 43-year history, and the largest percentage increase in the common dividend since 1988.

-- June 30, 2005 - Federal Realty announced the appointment of Jon E. Bortz, chairman, chief executive officer and president of LaSalle Hotel Properties (NYSE:LHO), to Federal Realty's board of trustees. Mr. Bortz will serve on Federal Realty's audit and compensation committees.

Conference Call Information

Federal Realty's management team will present an in-depth discussion of the Trust's operating performance on its second quarter 2005 earnings conference call, which is scheduled for July 29, 2005, at 11 a.m. Eastern Daylight Time. To participate, please call (888) 566-5771 five to ten minutes prior to the call's start time and use the Passcode EARNINGS (required). The conference leader is Andrew Blocher. Federal Realty will also provide an online Web Simulcast on the Company's Web site, www.federalrealty.com, which will remain available for 30 days following the call. A telephone recording of the call will also be available through Monday, August 29, 2005, by dialing (866) 448-4809.

About Federal Realty

Federal Realty Investment Trust is an equity real estate investment trust specializing in the ownership, management, development, and redevelopment of high quality retail assets. Federal Realty's portfolio (excluding joint venture properties) contains approximately 17.4 million square feet located primarily in strategic metropolitan markets in the Northeast, Mid-Atlantic, and California. In addition, the Trust has an ownership interest in approximately 0.5 million square feet of retail space through its joint venture with Clarion Lion Properties Fund in which the Trust has a 30% interest. Our operating portfolio (excluding joint venture properties) was 95.0% leased to national, regional, and local retailers as of June 30, 2005, with no single tenant accounting for more than 2.2% of rental revenue. Federal Realty has paid quarterly dividends to its shareholders continuously since its founding in 1962, and, through 2004, has increased its dividend rate for 37 consecutive years, the longest consecutive record in the REIT industry. Shares of Federal Realty are traded on the NYSE under the symbol FRT.

Safe Harbor Language

Certain matters discussed within this press release may be deemed to be forward-looking statements within the meaning of the federal securities laws. Although Federal Realty believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. These factors include, but are not limited to, the risk factors described in our Current Report on Form 8-K filed on March 2, 2005, and include the following:

-- risks that our tenants will not pay rent or that we may be unable to renew leases or re-let space at favorable rents as leases expire;

-- risks that we may not be able to proceed with or obtain necessary approvals for any redevelopment or renovation project, and that any redevelopment or renovation project that we do pursue may not perform as anticipated;

-- risks that the number of properties we acquire for our own account, and therefore the amount of capital we invest in acquisitions, may be impacted by our real estate partnership;

-- risks normally associated with the real estate industry, including risks that occupancy levels at our properties and the amount of rent that we receive from our properties may be lower than expected, that new acquisitions may fail to perform as expected, that competition for acquisitions could result in increased prices for acquisitions, that we may have environmental risks at our properties, and, because real estate is illiquid, that we may not be able to sell properties when appropriate;

-- risks that our growth will be limited if we cannot obtain additional capital;

-- risks of financing, such as our ability to consummate additional financings or obtain replacement financing on terms which are acceptable to us, our ability to meet existing financial covenants and the limitations imposed on our operations by those covenants, and the possibility of increases in interest rates that would result in increased interest expense; and

-- risks related to our status as a real estate investment trust, commonly referred to as a REIT, for federal income tax purposes, such as the existence of complex tax regulations relating to our status as a REIT, the effect of future changes in REIT requirements as a result of new legislation, and the adverse consequences of the failure to qualify as a REIT.

Given these uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements that we make, including those in this press release. Except as required by law, we make no promise to update any of the forward-looking statements as a result of new information, future events, or otherwise. You should review the risks contained in our annual report on Form 10-K, our quarterly reports on Form 10-Q, and the risks contained in our Current Report on Form 8-K filed with the Securities and Exchange Commission on March 2, 2005.

Federal Realty Investment Trust
Operating Results
June 30, 2005
----------------------------------------------------------------------

                         Financial Highlights
                 (in thousands, except per share data)
                              (unaudited)


CONSOLIDATED OPERATING RESULTS
------------------------------ Three months ended   Six months ended
                                    June 30,            June 30,
                                 2005      2004      2005      2004
                               --------- --------- --------- ---------
Revenues
   Rental income               $ 97,799  $ 94,771  $197,882  $185,550
   Other property income          2,082     2,434     4,030     4,592
   Mortgage interest income       1,449     1,304     2,730     2,381
                               --------- --------- --------- ---------
                                101,330    98,509   204,642   192,523
Expenses
   Rental                        20,078    22,065    43,520    43,959
   Real estate taxes             10,822     9,369    20,577    18,412
   General and administrative     4,981     4,588     9,484     8,770
   Depreciation and
    amortization                 22,956    22,856    45,463    43,103
                               --------- --------- --------- ---------
                                 58,837    58,878   119,044   114,244
                               --------- --------- --------- ---------
   Operating income              42,493    39,631    85,598    78,279

Other interest income             1,302       301     1,693       662
Interest expense                (21,827)  (21,391)  (43,890)  (42,710)
Income from real estate
 partnership                        153         -       224         -
Minority interests               (1,279)   (1,192)   (2,795)   (2,381)
                               --------- --------- --------- ---------
Income from continuing
 operations                      20,842    17,349    40,830    33,850

Discontinued operations
   Operating income from
    discontinued operations         363       707        90     1,394
   Gain on sale of real estate    3,602     8,276     7,884     8,334
                               --------- --------- --------- ---------
Income from discontinued
 operations                       3,965     8,983     7,974     9,728
                               --------- --------- --------- ---------

Net Income                       24,807    26,332    48,804    43,578

   Dividends on preferred
    stock                        (2,869)   (2,869)   (5,738)   (5,738)
                               --------- --------- --------- ---------
        Net income available
         for common
         shareholders          $ 21,938  $ 23,463  $ 43,066  $ 37,840
                               ========= ========= ========= =========

FUNDS FROM OPERATIONS AVAILABLE
 FOR COMMON SHAREHOLDERS
------------------------------
Net income                     $ 24,807  $ 26,332  $ 48,804  $ 43,578
Gain on sale of real estate      (3,602)   (8,276)   (7,884)   (8,334)
Depreciation and amortization
 of real estate assets           20,735    21,261    41,253    39,987
Amortization of initial direct
 costs of leases                  1,802     1,787     3,428     3,285
Depreciation on real estate
 partnership assets                 157         -       314         -
                               --------- --------- --------- ---------
Funds from operations            43,899    41,104    85,915    78,516
Dividends on preferred stock     (2,869)   (2,869)   (5,738)   (5,738)
Income attributable to
 operating partnership units        194       403       352       638
                               --------- --------- --------- ---------
Funds from operations
 available for common
 shareholders                    41,224    38,638    80,529    73,416
                               ========= ========= ========= =========


Weighted average number of
 common shares, diluted          53,408    52,681    53,305    51,593
                               ========= ========= ========= =========

Funds from operations
 available for common
 shareholders per diluted
 share                         $   0.77  $   0.73  $   1.51  $   1.42
                               ========= ========= ========= =========

NET INCOME PER COMMON SHARE,
 BASIC
------------------------------
Income from continuing
 operations available for
 common shareholders           $   0.34  $   0.28  $   0.67  $   0.56
Income from discontinued
 operations                        0.01      0.02         -      0.03
Gain on sale of real estate        0.07      0.16      0.15      0.16
                               --------- --------- --------- ---------
      Net income available for
       common shareholders,
       basic                   $   0.42  $   0.46  $   0.82  $   0.75
                               ========= ========= ========= =========

Weighted average number of
 common shares, basic            52,454    51,359    52,333    50,207
                               ========= ========= ========= =========

NET INCOME PER COMMON SHARE,
 DILUTED
------------------------------
Income from continuing
 operations available for
 common shareholders           $   0.34  $   0.28  $   0.66  $   0.56
Income from discontinued
 operations                        0.01      0.01         -      0.03
Gain on sale of real estate        0.06      0.16      0.15      0.16
                               --------- --------- --------- ---------
      Net income available for
       common shareholders,
       diluted                 $   0.41  $   0.45  $   0.81  $   0.75
                               ========= ========= ========= =========

Weighted average number of
 common shares, diluted          52,986    52,681    52,876    51,593
                               ========= ========= ========= =========




Federal Realty Investment Trust
Summarized Balance Sheets
June 30, 2005
----------------------------------------------------------------------

                         Financial Highlights
                            (in thousands)

CONSOLIDATED BALANCE SHEETS
---------------------------
                                              June 30,    December 31,
                                                2005         2004
                                             ------------ ------------
ASSETS                                       (unaudited)

Real estate, at cost
    Operating                                $ 2,614,198  $ 2,516,610
    Construction-in-progress                     140,632      130,286
    Discontinued operations                            -       19,380
                                             ------------ ------------
                                               2,754,830    2,666,276
Less accumulated depreciation and
 amortization                                   (630,861)    (595,338)
                                             ------------ ------------
Net real estate investments                    2,123,969    2,070,938

Cash and cash equivalents                         13,625       30,475
Accounts and notes receivable                     34,823       34,849
Mortgage notes receivable                         41,882       42,909
Investment in real estate partnership              9,519        9,631
Other assets                                      73,204       78,094
                                             ------------ ------------
TOTAL ASSETS                                 $ 2,297,022  $ 2,266,896
                                             ============ ============

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities
    Obligations under capital leases and
     mortgage notes                          $   408,748  $   410,885
    Notes payable                                365,340      325,051
    Senior notes and debentures                  568,404      568,121
    Other liabilities                            157,812      153,351
                                             ------------ ------------
Total liabilities                              1,500,304    1,457,408

Minority interests                                19,134       18,954

Shareholders' equity
    Preferred stock                              135,000      135,000
    Common shares and other shareholders'
     equity                                      642,584      655,534
                                             ------------ ------------
Total shareholders' equity                       777,584      790,534
                                             ------------ ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $ 2,297,022  $ 2,266,896
                                             ============ ============




Federal Realty Investment Trust
Reconciliation of 2005 Net Income to 2005 FFO Guidance
June 30, 2005
----------------------------------------------------------------------

($ millions except per share amounts) (1)
                                                         Forecast
                                                         --------
                                                            to

     Net income                                    $    90    $    91
     Gain on sale of real estate                        (8)        (8)
     Depreciation and amortization of real estate
      & joint venture assets                            84         84
     Amortization of initial direct costs of
      leases                                             7          7
                                                   --------   --------
     Funds from operations                             173        174
     Income attributable to operating partnership
      units                                              1          1
     Dividends on preferred stock                      (11)       (11)
                                                   --------   --------
     Funds from operations available for common
      shareholders                                     162  to    163
                                                   ========   ========

     Weighted Average Shares (diluted)                53.4
                                                   --------

     Funds from operations available for common
      shareholders per diluted share               $  3.03    $  3.05
                                                   --------   --------

Note:
-----
(1) Individual items may not add up to total due to rounding.

SOURCE: Federal Realty Investment Trust

Federal Realty Investment Trust, Rockville
Andrew Blocher, 301-998-8166
ablocher@federalrealty.com
or
Suzanne O'Neill, 301-998-8358
soneill@federalrealty.com