Camden Prepares For Economy Turnaround

Camden Property's funds from operations totaled $10.1 million at the end of Q4 2008, versus $57.1 million for the same period last year. On the income side, the company reported a net income of $71 million during the quarter, a drop from the $148.5 million reported at the end of 2007.

The alarm bells, however, aren't clanging. Given the number of years during which the Houston REIT has been operating, "this is not our first rodeo," commented Richard Campo, the company's chairman of the board and CEO, at the company's earnings call on February 10. Campo added that staff and management are working hard to position the company to take advantage of economic recovery when it occurs.

"Our on-site team is focused on day-to-day operations," Campo noted. "The support team is providing on-site teams with workplace excellence. Our liquidity and balance sheets are strong."

As of December 31, Camden had $444 million available under its $600 million unsecured revolving line of credit, which is scheduled to mature in January 2011. Furthermore, Camden could issue approximately $250 million in new secured or unsecured debt in 2009. Approximately $126 million of debt is scheduled to mature in 2009, while $348 million will come due in 2010.

The company's plan is to pay the debt through existing lines of credit, future debt offerings, retained cash flow from operations and dispositions. Company president and trust manager D. Keith Oden said there are also plans to close on a $380 million Fannie Mae facility, with proceeds being used to pay down outstanding debts.

Furthermore, Camden has brought construction starts to a halt. "Many markets entered the recession in late 2006, early 2007," Campo remarked. "We slowed the development pipeline long before many of our peers. We haven't started a wholly owned development since mid-2007, most of the ones after that are through joint ventures." Furthermore, no new construction projects will be launched until market conditions improve, he added.