(Save the date: RealShare Industrial 2012 comes to The Bankers Club, Miami, December 5 - 6.)

ORLANDO—CNL Lifestyle Properties announced operating results for the second quarter of 2012. The REIT reported an increase in net loss and loss per share year-over-year, blamed on a reduction in rental income of about $2.3 million at 32 golf resorts.

CNL posted $120.8 million in revenues, but the net loss was still $19.9 million. Beyond the golf resorts, CNL also blamed an increase in interest expense and loan coast amortization, an increase in bad debt expense and other cost-based factors.

Steve Mauldin, president and CEO of CNL Lifestyle Properties, tells GlobeSt.com despite the challenges with its golf properties, the firm is excited about the continued sustained improvement it is seeing over the last six to eight months. The REIT owns a portfolio of 177 properties.

“We have also done a great deal of work across the portfolio to restructure leases and tenant relationships where appropriate and to dispose of underperforming properties,” Mauldin says. “We think the company's performance going forward will reflect those improvements.”

Mauldin reports a strong start for CNL’s attractions properties. The firm also began investing in senior living properties in January 2011. Those now make up about one-third of the portfolio and have performed extremely well. Mauldin sees senior living as an area with growth possibilities due to the growing number of senior citizens and the projected, continued shortage of senior housing supply.
 
In terms of diversification, 32.5% of the assets are senior housing, 18.7% are ski and mountain lifestyle, 15.6% are golf, 13.4% are attractions, 5.1% are marinas and 14.7% are lifestyle property types, including lodging.

Mauldin also sees challenges—and he sees the biggest as the economic head winds, including employment challenges and the general level of uncertainty that still exists. He reports some modest growth and perceives marginal improvements in consumer confidence. But it has been slow going and remains quite fragile in his view.  

“If unemployment levels can continue to compress, and meaningful and sustained gains in consumer confidence and spending unfold, we believe this would naturally spur additional growth in the level of income at our properties and strengthen our tenants,” Mauldin says. “Another recession or negative external shock or event would obviously have the opposite effect.”

Mauldin says a factor for many of its properties that the firm cannot control and can present challenges is weather, particularly on key holidays and weekends. He points to the U.S.’s unseasonably warm winter that impacted the ski season.

“On the other hand, the mild winter was positive for our golf assets and their performance,” Mauldin says. “If we have another warm 2012-13 winter season, that could certainly impact our ski tenants and us. However, by diversifying our portfolio across property types and geographies, we have taken significant steps to mitigate those risks.”