DDR Ddr Corp.

BEACHWOOD, Ohio, Feb. 11, 2015 /PRNewswire/ -- DDR Corp. (NYSE: DDR) today announced operating results for the fourth quarter and year ended December 31, 2014. 

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Significant Fourth Quarter Activity

• Generated Operating FFO of $0.31 per diluted share, a 6.9% increase from the fourth quarter of 2013
• Executed 327 new leases and renewals for 1.8 million square feet
• Increased the U.S. portfolio leased rate by 10 basis points to 95.7% from 95.6% at September 30, 2014
• Generated new leasing spreads of 25.0% on a pro rata basis, and renewal leasing spreads of 7.2% on a pro rata basis
• Generated same store net operating income growth of 3.0% on a pro rata basis compared to the prior year
• Closed on a new unconsolidated joint venture with Blackstone that acquired a portfolio of 70 shopping centers with a total cost of $1.93 billion
• Acquired sole ownership of one power center, from an existing joint venture, for $15 million at DDR's share
• Liquidated two joint ventures containing 23 assets
• Sold $591 million of assets; DDR's pro rata gross proceeds were $258 million
• Issued $500 million, 3.625% senior unsecured notes due February 2025 in January 2015

2014 Year-end Highlights

• Generated Operating FFO of $1.16 per diluted share for the full year 2014, an increase of 4.5% compared to 2013
• Executed 1,411 new leases and renewals for 10.6 million square feet in 2014
• Increased the U.S. portfolio leased rate by 70 basis points from 95.0% at December 31, 2013
• Generated new leasing spreads for the full year 2014 of 22.2% on a pro rata basis, and renewal leasing spreads of 7.7% on a pro rata basis.

"We are pleased to announce another quarter of strong results and we remain confident that we are well-positioned and excited about the opportunity ahead," commented David J. Oakes, president and chief executive officer of DDR.

Financial Highlights

• Fourth quarter operating funds from operations attributable to common shareholders ("Operating FFO") increased $7.7 million to $112.2 million, or $0.31 per diluted share, compared to $104.5 million, or $0.29 per diluted share, for the prior-year comparable period.
• Operating FFO for the year ended December 31, 2014, increased to $420.4 million, or $1.16 per diluted share, compared to $366.7 million or $1.11 per diluted share, for the prior year.
• Fourth quarter net loss attributable to common shareholders was $16.3 million, or $0.05 per diluted share, which compares to net income of $0.6 million, or $0.00 per diluted share, for the prior-year comparable period.
• Net income attributable to common shareholders for the year ended December 31, 2014, was $91.3 million, or $0.25 per diluted share, which compares to net loss of $43.1 million or $0.14 per diluted share, for the prior year.

Significant Fourth Quarter and Year-End Operating Activity

• Executed 576 new leases totaling 2.9 million square feet at positive spreads of 22.2% on a pro rata basis, of which 140 new leases aggregating 0.6 million square feet at positive spreads of 25.0% on a pro rata basis were executed in the fourth quarter
• Executed 835 renewal leases totaling 7.7 million square feet at positive spreads of 7.7% on a pro rata basis, of which 187 renewal leases totaling 1.2 million square feet at positive spreads of 7.2% on a pro rata basis were executed in the fourth quarter
• The U.S. annualized base rent per occupied square foot was $13.91 at December 31, 2014 as compared to $13.35 at December 31, 2013, and increase of 4.2%.

Significant Fourth Quarter Transactional Activity

• In October, acquired a portfolio of 70 shopping centers with joint venture partner, Blackstone, for $1.93 billion or $376 million at the Company's share. The Company's investment includes $20 million of common equity, $62 million of newly financed and debt assumed at our share, and $300 million in preferred equity with a fixed dividend rate of 8.5%.
• Sold 12 consolidated operating shopping centers totaling 2.0 million square feet and seven land parcels generating gross proceeds of $214.4 million. A net gain of $22.1 million was recorded related to these sales.
• Sold 29 unconsolidated joint venture operating shopping centers, totaling 3.8 million square feet, generating gross proceeds of $376.2 million, of which the Company's pro rata share was $48.6 million. An aggregate net gain of approximately $26.8 million was recorded related to these asset sales, of which the Company's pro rata share was $4.2 million.
• Included in unconsolidated joint venture sale proceeds is the substantial liquidation of the Company's interests in two joint ventures as all of the underlying assets owned by the joint ventures were sold.

2015 Guidance

• There has been no change in Operating FFO per share guidance since the initial release on January 7, 2015.  The Company continues to estimate Operating FFO for 2015 between $1.20 and $1.25 per diluted share.

Non-GAAP Disclosures
FFO is a supplemental non-GAAP financial measurement used as a standard in the real estate industry and a widely accepted measure of real estate investment trust ("REIT") performance.  Management believes that FFO and Operating FFO provide additional indicators of the financial performance of a REIT.  The Company also believes that FFO and Operating FFO more appropriately measure the core operations of the Company and provide benchmarks to its peer group.  Neither FFO nor Operating FFO represents cash generated from operating activities in accordance with generally accepted accounting principles ("GAAP"), is necessarily indicative of cash available to fund cash needs and should not be considered as an alternative to net income computed in accordance with GAAP as an indicator of the Company's operating performance or as an alternative to cash flow as a measure of liquidity.

FFO is defined and calculated by the Company as net income, adjusted to exclude:  (i) preferred share dividends, (ii) gains and losses from disposition of depreciable real estate property, which are presented net of taxes, (iii) impairment charges on depreciable real estate property and related investments, (iv) extraordinary items and (v) certain non-cash items.  These non-cash items principally include real property depreciation and amortization of intangibles, equity income from joint ventures and equity income from non-controlling interests and adding the Company's proportionate share of FFO from its unconsolidated joint ventures and non-controlling interests, determined on a consistent basis.  The Company calculates Operating FFO by excluding the non-operating charges and gains described below.  The Company computes FFO in accordance with the NAREIT definition.  Other real estate companies may calculate FFO and Operating FFO in a different manner.  Operating FFO is useful to investors as the Company removes these charges and gains to analyze the results of its operations and assess performance of the core operating real estate portfolio.  A reconciliation of net income (loss) to FFO and Operating FFO is presented herein.

Safe Harbor
DDR Corp. considers portions of the information in this press release to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to the Company's expectation for future periods.  Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved.  For this purpose, any statements contained herein that are not historical fact may be deemed to be forward-looking statements.  There are a number of important factors that could cause our results to differ materially from those indicated by such forward-looking statements, including, among other factors, local conditions such as oversupply of space or a reduction in demand for real estate in the area; competition from other available space; dependence on rental income from real property; the loss of, significant downsizing of or bankruptcy of a major tenant; constructing properties or expansions that produce a desired yield on investment; our ability to buy or sell assets on commercially reasonable terms; our ability to complete acquisitions or dispositions of assets under contract; our ability to secure equity or debt financing on commercially acceptable terms or at all; our ability to enter into definitive agreements with regard to our financing and joint venture arrangements or our failure to satisfy conditions to the completion of these arrangements; the success of our capital recycling strategy; and the finalization of the financial statements for the three-month period ended and year ended December 31, 2014.  For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements, please refer to the Company's Form 10-K for the year ended December 31, 2013, as amended.  The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

About DDR Corp.
DDR is an owner and manager of 415 value-oriented shopping centers representing 118 million square feet in 41 states and Puerto Rico.  The Company's assets are concentrated in high barrier-to-entry markets with stable populations and high growth potential and its portfolio is actively managed to create long-term shareholder value. DDR is a self-administered and self-managed REIT operating as a fully integrated real estate company, and is publicly traded on the New York Stock Exchange under the ticker symbol DDR.  Additional information about the Company is available at www.ddr.com, as well as on Twitter, LinkedIn and Facebook.

Conference Call and Supplemental Information
A copy of the Company's Supplemental package is available upon request to Brooke Vanek at the Company's corporate office, 3300 Enterprise Parkway, Beachwood, Ohio 44122 or at www.ddr.com.

The Company will hold its quarterly conference call tomorrow, February 12, 2015, at 10:00 a.m. Eastern Time.  To participate, please dial 877.703.6107 (domestic) or 857.244.7306 (international) at least ten minutes prior to the scheduled start of the call.  When prompted, provide the passcode: 16795709.  The conference call webcast will be recorded and available for replay through the Investors portion of DDR's website, http://ir.ddr.com/events.cfm.

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SOURCE DDR Corp.