WASHINGTON (dpa-AFX) - Real estate investment firm W. P. Carey & Co. LLC (WPC) Monday reported a decline in funds from operations or FFO for the first quarter, hurt by lower revenue, and higher operating expenses that include an one time charge.
W.P. Carey and its CPA series of income-generating funds specialize in helping companies and private equities free up capital by purchasing and leasing back their real estate assets on a long-term basis.
The company reported first-quarter FFO of $25 million or $0.62 per share, down from $29.5 million or $0.73 per share last year. Excluding items, adjusted FFO for the quarter was $40 million or $0.99 per share, compared to $39 million or $0.97 per share last year.
Real estate firms add depreciation and other items that normally reduce their net earnings. The company reported first-quarter net income of $12.3 million or $0.30 per share, compared to $23.3 million or $0.58 per share a year ago.
Total revenue for the quarter fell to $69.4 million from $75.9 million last year. Excluding reimbursed expenses, revenue for the quarter was $50.7 million, compared to $58 million in the prior year.
Operating expenses for the quarter was $61.01 million compared to $49.33 million last year. The results included impairment charges.
As of March 31, the occupancy rate of W. P. Carey's 12 million square foot owned portfolio was about 93 percent. In addition, for the 107 million square feet owned by the CPA REITs, the average occupancy rate was nearly 98 percent at that date.
W. P. Carey in February received Board approval for its conversion to a real estate investment trust. The company is also merging with its publicly held, non-traded REIT affiliate, Corporate Property Associates 15 Inc. W.P. Carey expects the merger to close by the third quarter 2012, subject to shareholder approval and closing conditions.
WPC is trading at $46.35, down $0.65 or 1.38%, on the New York Stock Exchange.
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