for Ala Moanas
General Growth Properties Inc.From staff and wire reports
posted an 8.2 percent gain in
the second quarter
CHICAGO -- General Growth Properties Inc., one of the largest shopping-mall owners in the United States, today reported a second-quarter net income of $18.3 million, or 44 cents a share, up 8.2 percent from $16.9 million, or 47 cents, a year earlier.
The Chicago-based real estate investment trust, which last week week concluded its $810 million purchase of the 1.8-acre Ala Moana Center, said its second-quarter earnings from operations rose a better-than-expected 37 percent, to $59.6 million from $43.5 million a year earlier.
On a per-share basis, earnings from operations -- the best measure of a REIT's performance -- rose to 94 cents from 74 cents, exceeding Wall Street's estimates of 91 cents a share, according to a survey of analysts by First Call Corp. The per-share operating profit was up 19 percent after adjusting for an increase in the number of shares outstanding. Revenue was $205.8 million, up from $129.4 million.
A vibrant economy has lifted consumer confidence, sparking better-than-expected gains in retail spending. That prompted retailers to seek more space and allowed landlords to raise rents.
The company's shares fell 6 cents to $33.19 today. For 1999, the shares are down 12 percent as the company's plan to refinance about $1.5 billion of debt has gone more slowly than hoped.
General Growth is among the leaders in the consolidating mall business. The company has bought $5.7 billion of properties since mid-1993. It now owns and manages 124 malls in 39 states with a total of 100 million square feet of space.
The company purchased Hawaii's largest mall, which it already managed, from financially ailing Daiei Inc. of Japan. "Since signing Ala Moana back in May, (General Growth) has seen sales volumes increase to the $900 per square foot level and has received significant interest from upper-end retailers not currently represented in the mall," Lehman Brothers' real estate analyst Steve Hash said in a statement.