IBJNews

Duke Realty reports massive third-quarter loss

Back to TopCommentsE-mailPrintBookmark and Share

Big write-downs on raw land and projects under development led to a wide third-quarter loss for Duke Realty Corp.

The locally based company said Thursday morning it lost $1.02 per diluted share in funds from operations, a common yardstick for real estate investment trusts, for the period ended Sept. 30.

Excluding one-time items including a $297-million write-down, Duke would have reported FFO of 32 cents, beating consensus analyst expectations by a penny. The company reaffirmed expectations it will earn between $1.42 and $1.64 per share in 2009.

The write-downs include $132 million for land holdings now targeted for disposition (including properties in the Indianapolis area), $70 million for properties under development and more than $50 million on a joint-venture project in Atlanta. Duke decided to sell land holdings because it anticipates lower development demand.

Duke reported a net loss of $314 million on revenue of $325 million, compared to net income of $31 million on revenue of $309 million during the same span in 2008.

The company has raised $1.5 billion in capital this year, most of it available as part of a credit facility, to bolster its balance sheet. The company said it has enough cash on hand to pay off all unsecured debt that comes due through 2010.

"Our core operating portfolio has held up reasonably well the last 12 months,"  Chairman and CEO  Dennis D. Oklak said in a statement. "We are focused on leasing our recently placed in service development projects and strategically reducing our undeveloped land inventory."

Occupancy for Duke, which owns 136 million square feet of mostly office and industrial space in 20 U.S. cities, stood at 87 percent at the end of the third quarter, down slightly from the previous quarter.

The company said it will continue to pay a quarterly dividend of 17 cents per share. At the Wednesday close of $11.23, that's a 6-percent annual yield.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. By Mr. Lee's own admission, he basically ran pro-bono ads on the billboard. Paying advertisers didn't want ads on a controversial, ugly billboard that turned off customers. At least one of Mr. Lee's free advertisers dropped out early because they found that Mr. Lee's advertising was having negative impact. So Mr. Lee is disingenous to say the city now owes him for lost revenue. Mr. Lee quickly realized his monstrosity had a dim future and is trying to get the city to bail him out. And that's why the billboard came down so quickly.

  2. Merchants Square is back. The small strip center to the south of 116th is 100% leased, McAlister’s is doing well in the outlot building. The former O’Charleys is leased but is going through permitting with the State and the town of Carmel. Mac Grill is closing all of their Indy locations (not just Merchants) and this will allow for a new restaurant concept to backfill both of their locations. As for the north side of 116th a new dinner movie theater and brewery is under construction to fill most of the vacancy left by Hobby Lobby and Old Navy.

  3. Yes it does have an ethics commission which enforce the law which prohibits 12 specific items. google it

  4. Thanks for reading and replying. If you want to see the differentiation for research, speaking and consulting, check out the spreadsheet I linked to at the bottom of the post; it is broken out exactly that way. I can only include so much detail in a blog post before it becomes something other than a blog post.

  5. 1. There is no allegation of corruption, Marty, to imply otherwise if false. 2. Is the "State Rule" a law? I suspect not. 3. Is Mr. Woodruff obligated via an employment agreement (contractual obligation) to not work with the engineering firm? 4. In many states a right to earn a living will trump non-competes and other contractual obligations, does Mr. Woodruff's personal right to earn a living trump any contractual obligations that might or might not be out there. 5. Lawyers in state government routinely go work for law firms they were formally working with in their regulatory actions. You can see a steady stream to firms like B&D from state government. It would be interesting for IBJ to do a review of current lawyers and find out how their past decisions affected the law firms clients. Since there is a buffer between regulated company and the regulator working for a law firm technically is not in violation of ethics but you have to wonder if decisions were made in favor of certain firms and quid pro quo jobs resulted. Start with the DOI in this review. Very interesting.

ADVERTISEMENT