CBL Outlines Expansion

The CBL chairman pointed out that the company is looking for growth opportunities in a number of new markets, "such as our recently announced investment in a Chinese-based mall developer." The comment was a reference to CBL's agreement, after the end of the fourth quarter, with global private investment firm Bain Capital to invest in subsidiaries of Jinsheng Group, a home decorating mall operator and real estate development company based in Nanjing, China.

CBL and Bain Capital acquired a significant minority equity interest through an initial investment of $60 million in the Jinsheng Group subsidiaries. CBL contributed $15 million of the total, with funds advised by affiliates of Bain Capital contributing $45 million.

According to Lebovitz, the company plans a continuation in 2007 of the strategy it pursued in 2006 of "aggressively managing our existing portfolio" as well as "expanding our pipeline with new development and redevelopment projects." To that end, CBL opened nearly two million sf of lifestyle developments, redevelopments and expansions during the year.

During the conference call, CBL reported that funds from operations allocable to common shareholders for the fourth quarter of 2006 totaled $66.6 million, compared with $56.6 million for the fourth quarter ended Dec. 31, 2005. For the year FFO allocable to common shareholders was $219 million for 2006, compared with $213.6 million for the year ended Dec. 31, 2005.

FFO per share rose 14.6% to $1.02 in the fourth quarter and increased 10.1% to $3.39 per share for the year ended Dec. 31, 2006, up from FFO of $3.08 per share the previous year after certain adjustments. Same-store sales improved by 3.3% for the year, and the company ended the year with an occupancy rate of 93.8% in its portfolio.

Net income climbed to $34.4 million for the fourth quarter ended Dec. 31, compared with $25.6 million in the fourth quarter the year before. On a per share basis, that worked out to 52 cents in the fourth quarter of 2006, up from 40 cents in the previous year's fourth quarter.

For the year, net income decreased to $90.3 million from $131.9, but the previous year's figure included a one-time gain of $39.8 million. Revenues increased 4.3% in the fourth quarter to $273.3 million in the fourth quarter of the previous year and climbed 10.4% to more than $1 billion for the year.