Thank you for sharing!

Your article was successfully shared with the contacts you provided.

CHICAGO-The strength of the retail sector during the recent economic downturn and jobless recovery is paying great dividends for General Growth Properties Inc. stockholders. Having announced earlier this month that it will increase its dividend by 25% subject to shareholder approval next month, the REIT backed up the proposal with a record 22.1% increase in third-quarter funds from operations.

Based on its most recent price of $75.22 per share, General Growth Properties’ dividend yield is 4.74%.

“REIT investors want to see dividend growth,” notes CFO Bernard Freibaum.

Net operating income is up 20% from the third quarter of 2002 to $275.7 million. Those results come even as General Growth’s tenants are seeing flat sales, increasing less than 1% to $354 per sf across the second-largest US retail REIT’s portfolio in the past year.

However, General Growth increased its occupancy rate two percentage points to 90.7%, continued to see increases in its specialty leasing program that capitalizes on malls’ common areas and substantial increases on new leases. The $33.62 per sf on new leases is up 26% over the $26.70 per sf rate of all expiring leases.

“Sales started to improve in August; and September, the third-most important retail month of the year, was very strong,” said president and COO Robert Michaels during Tuesday’s earnings conference call. “For ’04, the attitude of retailers is more positive than it was at the beginning of the year.”

Meanwhile, customer surveys reveal one surprising trend–renewed popularity of department stores, recently considered to be under-performers in most mall tenant rosters.

In addition to a dividend increase, General Growth Properties stockholders also will be asked next month to approve a 3-for-1 stock split.

“We’re constantly looking for ways to improve,” says CEO John Bucksbaum. “We’re improving as a company, and the key word here is company.”

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

GlobeSt. NET LEASE Spring 2021Event

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Get More Information


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.