DOW JONES NEWSWIRES
Kimco Realty Corp. (KIM) said it will cut its dividend 86%, to 6
cents in the third and fourth quarters, as the shopping-center
owner plans to sell 70 million common shares in a secondary
offering.
Shares fell 3.3%, to $7.24, in after-hours trading.
The real estate investment trust also reduced the top end of its
projected range for 2009 funds from operations, a key measure of
REIT profitability. It now estimates FFO of $1.70 to $1.85 a share,
compared with $1.70 to $1.90 a share in February. That forecast was
far below Wall Street's then-expected $2.22. Analysts last
estimated $1.73, according to a poll by Thomson Reuters.
In addition, Kimco said it is marketing a new $200 million
unsecured term loan with a group of banks. The company has received
commitments totaling $160 million from nine banks and continues to
work with others. It expects to close the facility during the
second quarter.
In February, Kimco repaid its $130 million 6.875% senior notes
at maturity with proceeds from its U.S. $1.5 billion revolving
credit facility. The company has availability totaling about $760
million under its U.S. and Canadian unsecured revolving credit
facilities, which are scheduled to mature in 2011.
Regarding its leasing activity for the first quarter, Kimco said
it signed about 100 new same-space leases at an average rent
increase of 13% and about 50 new nonsame-space leases. The company
also signed about 315 renewals at an average rent increase of 2.5%.
Its preliminary estimate for U.S. occupancy as of the end of March
is 91.9%.
In February, Kimco swung to a fourth-quarter net loss on $113.1
million of investment write-downs. Retail real estate has been
struggling as the housing and commercial real-estate markets
continue to slump amid the global recession and credit crunch.
Retail-sales declines, which have occurred as consumers curb
discretionary spending, translate into weaker retailers, more
vacancies and increased difficulties for landlords, some carrying
heavy debt loads.
-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975; Kathy.Shwiff@dowjones.com