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JACKSONVILLE, FL-The $2.74-billion portfolio purchase of 101 shopping centers totaling 13 million sf in 17 states and the District of Columbia from CalPERS/First Washington in February is paying extra dividends in the form of higher FFO numbers for locally based Regency Centers Corp., one of the largest retail developers in the US.

Directly attributed to the CalPERS/First Washington deal, Regency chairman and CEO Martin E. Stein expects second-quarter funds from operations to be in the 99-cents to $1.01 per-share-range, up from the predicted 86 cents to 95 cents per diluted share announced in May.

For the full year, diluted FFO per share is expected to be in the range of $3.59 to $3.67, an increase from the previously issued guidance of $3.55 to $3.63 per share, the company says in a prepared state. Final company results from its 10Q form that will be filed with the Securities and Exchange Commission will be released after the market closes Aug. 3.

“The updated guidance reflects a combination of several factors, but primarily a favorable impact resulting from non-cash income from straight line rent and FASB 141 [marking to market of below market rents] and higher fee recognition from the CalPERS/First Washington transaction,” according to the company’s statement.

Other favorable news Regency is reporting to its shareholders this week is the completion of the sale of $350 million of 5.25%, 10-year senior unsecured notes by its operating partnership, Regency Centers LP. The notes are due Aug. 1, 2015 and are priced at 99.858%. Interest on the notes will be paid semi-annually on Feb. 1 and Aug 1 of each year, beginning Feb. 1, 2006.

“As a result of an interest rate hedge initiated in April, related to the issuance of the notes, the effective interest rate to Regency is 5.48%,” the company states. The net proceeds will be used to reduce the debt outstanding under the bridge loan made on June 1 this year to fund Regency’s equity investment in the acquisition of the CalPERS/First Washington portfolio; and to reduce borrowings under Regency’s corporate line of credit. Regency’s joint venture partner in the CalPERS acquisition was Macquarie Countrywide of Sydney, Australia.

JPMorgan and Wachovia Securities acted as joint book runners and joint lead managers for the $350 million securities transaction. The co-managers were Wells Fargo Securities, PNC Capital Markets Inc., SunTrust Robinson Humphrey, Commerzbank Corporates and Markets, ING Financial Markets and Piper Jaffray.

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