On Jan 14, 2015, Regency Centers Corporation (REG), the Jacksonville, FL-based retail real estate investment trust (“REIT”) announced preliminary results for fourth-quarter as well as full year 2014. This included a 4% year over year increase in same store net operating income (“NOI”) in 2014, marking the third consecutive year of same property NOI growth. Further, adding to the delight of its shareholders, the company announced a 3.2% increase in the quarterly cash dividend.
For the fourth-quarter 2014, Regency Centers expects the core funds from operations (“FFO”) per share and FFO per share in the ranges of 70–72 cents and 76–79 cents, respectively. Notably, about a month ago, the company had provided full year 2014 core FFO per share and FFO per share guidance in the respective ranges of $2.81 – $2.83 and $2.88 – $2.91 and retained the same guidance this time also (read more: Regency Provides Guidance for 2015, Revises 2014 Outlook).
Regency Centers also provided other operating results for full-year year 2014 as well as the fourth quarter. In the Oct–Dec quarter, same property NOI for the fourth quarter increased 5.3% year over year, whereas for 2014 it grew 4% year over year.
For the quarter ended Dec 31, 2014, same space rental rate (on a cash basis for spaces vacant less than 12 months) grew 16.9% in case of new leases and 8.2% in case of renewal leases. For the full year, these figures were 31.95% in case of new leases and 8.2% in case of renewal leases.
For 2014, Regency Centers completed 1,418 new and renewal lease transactions for a total of 5.4 million square feet. Out of this, 415 new and renewal lease transactions for 1.4 million square feet were closed in the last quarter.
Regarding its portfolio activities, Regency Centers acquired Broadway Market for $43.0 million in Dec 2014. In the same month, the REIT acquired its partner’s 50% interest in Indian Springs Center for $26.6 million.
Further, on Jan 14, 2015, Regency announced a quarterly cash dividend of 48.5 cents per share, up 3.2% sequentially as well as year over year. The dividend will be paid on Mar 5, 2015 to shareholders of record as of Feb 23.
Notably, on the same day, Regency Centers announced its plan to start a public offering of up to 2.5 million of its common stocks. The company added that as a result of its proposed equity offering, its full-year 2015 Core FFO and FFO guidance released on Dec 15, 2014 is not affected.
Currently, Regency carries a Zacks Rank #2 (Buy). Investors interested in retail-REITs may also consider other stocks like American Assets Trust, Inc. (AAT), The Macerich Co. (MAC) and CBL & Associates Properties Inc. (CBL). All these stocks hold the same Zacks Rank as Regency.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
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