PREIT Posts 43.8% Income Jump

"We are pleased with our strong first quarter financial results," Ronald Rubin, chairman and chief executive officer of PREIT said in a conference call to investors. "The company's solid numbers demonstrate our ability to expand and enhance our portfolio through selective acquisitions, redevelopment and remerchandising initiatives."

The Philadelphia-based real estate investment trust also showed strong improvement in its FFO, which increased 8.2% to $36.2 million from $33.4 million in the first quarter of 2004. Net operating income derived from wholly-owned properties and partnerships also was on the upswing, rising by 4.2% to $69.4 million in the first quarter from $66.6 percent during the same period in 2004.

For shareholders, that reflected a 31.3% increase in the per share diluted basis from 16 cents in the first quarter of 2004 to 21 cents in the first quarter of 2005. News of the strong financials sent the trust's stock up 36 cents to close at $42.51 on Monday.

PREIT holds a portfolio of more than 33 million sf in shopping mall and power center investments in the eastern United States, including 38 shopping malls, 13 strip and power centers and four industrial properties. During the last year, the trust wrapped up its acquisition of the Cherry Hill Mall in Cherry Hill, NJ, the Gallery at Market East II in Philadelphia, the Orlando Fashion Square in Orlando, FL and the Cumberland Mall in Vineland, NJ. It also disposed of five malls acquired in a November 2003 merger with Crown American Realty Trust and sold its 60 percent interest in Rio Grande Mall in Rio Grande, NJ.

Company officials, who said the trust has tripled its business in the last year, also reported strong leasing activity and occupancy levels throughout its holdings. While down slightly, overall occupancy for the trust's total retail portfolio was 91.2% in the first quarter of 2005, which ended March 31, compared to 91.9% during the same period the prior year. The decline in occupancy was a result of continuing remerchandising and redevelopment and the reacquisition of space from underperforming or bankrupt tenants, the firm said.

Leasing activity also was strong during the first quarter with 109 new leases signed for a total of 325,000 sf with 720,000 sf of leases awaiting execution.