"Despite the challenging macro environment, we are pleased with our first quarter 2009 operating results which came in as expected," says Scott Wolstein, Developers Diversified's chairman and CEO. "We executed nearly 2 million square feet of leases and are making headway in leasing space that we have recently recaptured from retailer bankruptcies."

Despite severe apprehension in the market about the health of the retail sector, Developers Diversified signed 124 new leases, which is 34 more leases than Q4. The company also renewed 227 leases portfolio wide. "Contrary to what some of the headlines might say, there are some retailers looking to make deals," says Daniel Hurwitz, president and COO, during the earnings call. Additionally, the company sold seven properties totaling 0.7 million square feet.

Current occupancy is 90.7% and executives expect occupancy to hover around 90% for the rest of the year. Hurwitz says that 40% of the vacant space is due to bankruptcy closings. The retailers expressing the most interest include Bed Bath & Beyond, Best Buy, Staples, TJ Max and Forever 21. Hurwitz says Developers Diversified is in talks with each of these companies to fill space left vacant after the Circuit City, Steve & Barry's and Mervyn store closings.

To date, Developers Diversified has received 672 rent relief requests, of those 525 have come from local tenants. Hurwitz says that each request is evaluated on a case-by-case basis after a number of financial documents have been obtained from the companies. Of those requests a large number never submit the necessary financial information. Of those that do, Developers Deiversified has approved 20 requests.

The first closing on the Otto Family deal, which received shareholder approval earlier this month, will likely close in the next couple weeks. This 30 million stock sale will provide the company with $112.5 million. The deal will be completed in two closings, trading 15 million shares each time. The second closing is expected to take place in six months. Additionally, the company will allow Otto family members and their investors to purchase an additional 10 million shares at $6.00 per share, according to company executives.

The REIT owns 710 retail assets in 45 states, plus Puerto Rico, Brazil and Canada. Its portfolio totals 157 million square feet.