(RTTNews) - Real estate investment trust Kimco Realty Corp. (KIM) reported Wednesday a 36% year-over-year drop in fund from operations or FFO for the third quarter, hurt by a decline in occupancy as well as loss of rent from few companies that closed down. Excluding charges and costs, FFO per share for the quarter dropped 56%, and came in line with analysts' expectations. The company also lowered its FFO forecast for the full year 2009.

Third Quarter Results

The New Hyde Park, New York-based company posted FFO of $112.55 million or $0.30 per share, lower than $176.89 million or $0.68 per share in the prior-year quarter. On average, 18 analysts polled by Thomson Reuters expected the company to report earnings of $0.31 per share. Analysts' estimates typically exclude special items.

Excluding non-cash impairments and charges for the acceleration of deferred costs from early debt repayment, FFO for the quarter dropped to $117.9 million or $0.31 per share from $182.80 million or $0.70 per share in the year-ago quarter.

Net income available to common shareholders for the quarter totaled $28.29 million or $0.07 per share from $96.76 million or $0.37 per share in the comparable quarter a year ago.

Revenues from rental properties for the quarter edged up to $191.89 million from $189.95 million in the same quarter last year. Nine Wall Street analysts had a consensus revenue estimate of $187.77 million for the quarter.

Peer Performance

Among Kimco's peers, Indianapolis, Indiana-based Simon Property Group, Inc. (SPG) reported last week a 2% year-over-year increase in third quarter funds from operations to $473.07 million or $1.38 per share, helped by stable performance of franchise retail assets within its regional mall, premium outlet and mills platforms. Quarterly revenues decreased to $924.93 million from $935.59 million in the prior-year quarter.

Another peer, Houston, Texas-based Weingarten Realty Investors (WRI) reported last week a decline in FFO for the third quarter to $29.73 million or $0.25 per share from $59.89 million or $0.71 per share, primarily reflecting a non-cash impairment charge. Total quarterly revenues decreased to $144.54 million from $153.97 million a year ago.

Other Metrics

Net operating income or NOI, for the third quarter edged down to $133.66 million from $135.84 million in the prior-year quarter, and total rental property expenses were $58.22 million, up from $54.11 million in the year-ago quarter.

Same-property NOI on an aggregate basis declined 3.6% from the third quarter of 2008, reflecting a decline in occupancy as well as a two percentage points impact of lost rent and recoveries from Linens N Things, Circuit City and Value City.

Kimco's shopping center portfolio of 914 operating properties, includes 805 assets in the U.S. and Puerto Rico, 51 in Canada, 48 in Mexico and ten in South America. It has another 18 development properties, including four assets in the U.S., nine in Mexico and five in South America. The company posted quarter end occupancy of 92.4% for the entire shopping center portfolio, with 91.9% occupancy in the U.S. portfolio.

 Continued...