Brandywine Realty Trust (
, a real estate investment trust (REIT), reported third quarter
2012 FFO (funds from operations) of 39 cents per share, in line
with the Zacks Consensus Estimate. However, this compares
unfavorably with the FFO of 41 cents in the year-earlier quarter.
BRANDYWINE RT (BDN): Free Stock Analysis
MACK CALI CORP (CLI): Free Stock Analysis
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FFO stood at $57.7 million in the third quarter of 2012 compared
with $60.3 million in the year-ago quarter. The company reported
CAD (cash available for distribution) of $30.2 million or 21
cents per share compared with $10.1 million or 7 cents per share
in the prior year.
Total revenue during the reported quarter was $140.4 million,
slightly up from $139.4 million in the year-ago quarter, but
missed the Zacks Consensus Estimate of $141.0 million.
With respect to same-store properties, Brandywine's total net
operating income (NOI) increased 2.5% to $80.0 million. NOI,
excluding termination revenues and other income items, upped 0.2%
to $77.3 million on a GAAP basis and 0.9% to $71.9 million on a
Brandywine executed strong leasing activities during the third
quarter. The company signed lease agreements for approximately
1,212,679 square feet of space, comprised of 399,008 square feet
of new leases, 111,710 square feet of tenant expansion and
701,961 square feet of renewed lease. In addition, Brandywine
signed new leases for 553,801 square feet of space, with the
leasing period set to commence after the third quarter of 2012.
The company achieved a tenant retention ratio of 60.6% with a
negative net absorption of 129,364 square feet in its core
portfolio. As of September 30, 2012, Brandywine's core portfolio
comprising 218 properties and spanning 24.3 million square feet
was 88.6% leased and 86.3% occupied, including new leases
starting subsequent to the end of the quarter.
Acquisitions and Dispositions
During the reported quarter, Brandywine in collaboration with its
joint venture partner closed the acquisition of Station Square, a
499,395 square feet three-property office portfolio in Maryland,
for $120.6 million.
Brandywine completed the sale of Oaklands Corporate Center, a
Pennsylvania-based eleven-property office portfolio spanning
466,719 square feet, for $52.7 million.
As of September 30, 2012, Brandywine had an urban town center and
suburban office portfolio of 295 properties which spans 34.0
million square feet. This includes 219 properties (24.5 million
square feet) owned on a consolidated basis and 57 properties (7.0
million square feet) owned through unconsolidated real estate
At the end of the quarter, the company had cash and cash
equivalents of $241.6 million and net debt to gross assets ratio
of 42.4%. The company had no outstanding balance on its $600.0
million unsecured revolving credit facility. Brandywine declared
and paid a dividend of 15 cents per share in the reported
Brandywine slightly narrowed the 2012 FFO guidance to the range
of $1.33 to $1.36 per share from the previous range of $1.32 to
$1.36. However, for 2013, the company expects FFO to be in the
range of $1.38 to $1.46 per share.
Currently the Zacks Consensus Estimate for 2012 and 2013 are
pegged at $1.34 and $1.40, respectively.
One of the company's competitors,
Mack-Cali Realty Corp. (
reported its third quarter FFO of 65 cents per share, beating the
Zacks Consensus Estimate by 3 cents.
Brandywine carries a Zacks #3 Rank, implying a short-term Hold
rating. We also reiterate our long-term Neutral recommendation on
Note: FFO, a widely accepted and reported measure of the
performance of REITs, is derived by adding depreciation,
amortization and other non-cash expenses to net income.
CAD, a measure to ascertain the ability of a REITs to generate
cash, is derived by subtracting straight-line rent and
non-recurring real estate expenses from funds from