Douglas Emmett, Inc. Announces First Quarter 2007 Results Reports Diluted FFO Per Share of $0.28



    SANTA MONICA, Calif., May 8 /PRNewswire-FirstCall/ -- Douglas Emmett,
 Inc. (NYSE:   DEI), a real estate investment trust (REIT) focused on owning
 and acquiring top-tier office properties and multifamily communities within
 targeted submarkets, today announced its first quarter financial results
 for the period ended March 31, 2007.
     Quarterly Results
     Funds From Operations (FFO) for the first quarter of 2007 totaled $46.4
 million, or $0.28 per diluted share. For period ended, March 31, 2007, the
 Company reported a net loss of $3.3 million, or $0.03 per diluted share.
     Company Operations
     As of March 31, 2007, the Company's office portfolio was 95.2% leased
 compared to 94.3% leased at December 31, 2006. During the first quarter,
 the Company signed 116 new and renewal leases, comprised of approximately
 438,357 square feet, resulting in overall positive net absorption of
 136,127 square feet. The Company's multifamily portfolio was 99.4% leased
 at March 31, 2007.
     Dividends / Annual Shareholders' Meeting
     On April 16, 2007, the Company paid a quarterly cash dividend of $0.175
 per share to shareholders of record on March 30, 2007. The dividend
 represents a distribution of $0.70 per common share on an annualized basis.
 In addition, Douglas Emmett's Annual Meeting of Shareholders will be held
 on Thursday, May 31, 2007 at 9:30 a.m. (PST) at The Loews Santa Monica
 Beach Hotel, which is located at 1700 Ocean Avenue, Santa Monica,
 California 90401. Shareholders of record on April 2, 2007 will be entitled
 to vote at the meeting.
     Conference Call and Web Cast Information
     A conference call to discuss the Company's 2007 first quarter results
 is scheduled for Wednesday, May 9, 2007 at 2:00 p.m. Eastern Time, or 11:00
 a.m. Pacific Time. Interested parties can access the live call by going to
 the Investor Relations section of the Company's Web site at
 http://www.douglasemmett.com or by dialing into the call at 800.240.2134
 (domestic) or 303.262.2142 (international). A rebroadcast of the live call
 will be available via the web site for 90 days. A digital replay will be
 available through Wednesday, May 16, 2007 at 800.405.2236 (domestic) or
 303.590.3000 (international) and using the passcode 11087756.
     Supplemental Information
     Supplemental financial information for the Company's first quarter
 financial results can be accessed on the Company's Web site under the
 investors section at http://www.douglasemmett.com.
     Upcoming Management Presentations
     The Company will be participating in a panel discussion at the BMO
 Capital Markets North American REIT Conference on Thursday, May 17, 2007 at
 11:15 a.m. Central Time. The discussion will be web cast and accessible via
 the Company's Web site at http://www.douglasemmett.com, and by selecting
 the Calendar of Events in the Investor Relations section. An archive of the
 web cast will be available for 6 months.
     About Douglas Emmett, Inc.
     Douglas Emmett, Inc. (NYSE:   DEI) is a fully integrated,
 self-administered and self-managed real estate investment trust (REIT), and
 one of the largest owners and operators of high-quality office and
 multifamily properties located in targeted submarkets in California and
 Hawaii. The Company's property portfolio currently consists of 46 office
 properties with approximately 11.6 million rentable square feet, nine
 multifamily properties with a total of 2,868 units, and interests in three
 land parcels. For more information on Douglas Emmett, please visit the
 Company's Web site at http://www.douglasemmett.com.
     Safe Harbor Statement
     Except for the historical facts, the statements in this press release
 regarding Douglas Emmett's business activities are forward-looking
 statements based on the beliefs of, assumptions made by, and information
 currently available to, us about known and unknown risks, trends,
 uncertainties and factors that are beyond our control or ability to
 predict. Although we believe that our assumptions are reasonable, they are
 not guarantees of future performance and some will inevitably prove to be
 incorrect. As a result, our actual future results can be expected to differ
 from our expectations, and those differences may be material. Accordingly,
 investors should use caution in relying on past forward-looking statements
 to anticipate future results or trends. For a discussion of some of the
 risks and uncertainties which could cause actual results to differ from
 those contained in the forward-looking statements, see "Risk Factors" in
 our Annual Report on Form 10-K filed with the Securities and Exchange
 Commission.
                              -- tables follow --
 
 
                              Douglas Emmett, Inc.
                          Consolidated Balance Sheets
                     (in thousands, except for share data)
 
                                                      March 31,    December 31,
                                                        2007          2006
                                                     (unaudited)
     Assets
     Investments in real estate:
       Land                                            $813,599     $813,599
       Buildings and improvements                     4,865,897    4,863,955
       Tenant improvements and leasing costs            419,350      411,063
                                                      6,098,846    6,088,617
 
       Less: accumulated depreciation                   (83,638)     (32,521)
         Net investment in real estate                6,015,208    6,056,096
 
       Cash and cash equivalents                          3,850        4,536
       Tenant receivables                                 3,915        4,160
       Deferred rent receivables                          8,092        3,587
       Interest rate contracts                           71,274       76,915
       Acquired above-market lease intangibles, net      31,413       34,137
       Other assets                                      20,089       20,687
         Total Assets                                $6,153,841   $6,200,118
 
     Liabilities
       Secured notes payable                         $2,750,000   $2,760,000
       Unamortized non-cash debt premium                 28,607       29,702
       Interest rate contracts                           16,200        6,278
       Accrued interest payable                          12,614       12,701
       Acquired below-market lease intangibles, net     251,062      263,649
       Accounts payable and accrued expenses             41,894       39,035
       Security deposits                                 29,176       28,670
       Dividends payable                                 20,126       13,801
         Total Liabilities                            3,149,679    3,153,836
       Minority interest (1)                            927,685      934,509
 
     Stockholders' equity
       Common stock                                       1,150        1,150
       Additional paid-in capital                     2,144,591    2,144,600
       Accumulated other comprehensive (loss)
        income                                          (11,473)         415
       Accumulated deficit                              (57,791)     (34,392)
         Total stockholders' equity                   2,076,477    2,111,773
         Total liabilities and stockholders'
          equity                                     $6,153,841   $6,200,118
 
     (1) Represents the portion of results attributable to ownership interests
         in our operating partnership through OP units.
 
 
 
                              Douglas Emmett, Inc.
                       Consolidated Statements of Income
              (unaudited and in thousands, except per share data)
 
                                                          Three Months Ended
                                                            March 31, 2007
     Revenues
       Office rental:
         Rental revenues                                       $91,612
         Tenant recoveries                                       7,858
         Parking and other income                               11,100
       Total office revenues                                   110,570
 
       Multifamily rental:
         Rental revenues                                        16,514
         Parking and other income                                  491
       Total multifamily revenues                               17,005
 
       Total Revenues                                          127,575
 
     Operating Expenses
       Office rental                                            32,966
       Multifamily rental                                        4,923
       General and administrative expenses                       5,042
       Depreciation and amortization                            51,121
 
       Total operating expenses                                 94,052
 
     Operating income                                           33,523
       Interest and other income                                    82
       Interest expense                                        (38,302)
 
     Loss before minority interests                             (4,697)
       Minority interests (1)                                    1,424
 
     Net loss                                                  $(3,273)
     Net loss per common share - basic and diluted              $(0.03)
     Weighted average shares of common stock
      outstanding - basic and diluted                          115,006
 
     (1) Represents the portion of results attributable to ownership interests
         in our operating partnership through OP units.
 
 
 
     FFO Reconciliation
 
     Funds From Operations (FFO)(1):
     Net loss                                                  $(3,273)
       Depreciation and amortization of real estate assets      51,118
       Minority interest                                        (1,424)
     FFO                                                       $46,421
 
     Weighted average common shares and units outstanding
      (in thousands) diluted for the quarter ended
      March 31, 2007                                           166,391
     FFO per share - diluted                                     $0.28
 
     (1) We calculate funds from operations before minority interest (FFO) in
         accordance with the standards established by the National Association
         of Real Estate Investment Trusts (NAREIT). FFO represents net income
         (loss), computed in accordance with accounting principles generally
         accepted in the United States of America (GAAP), excluding gains (or
         losses) from sales of depreciable operating property, real estate
         depreciation and amortization (excluding amortization of deferred
         financing costs) and after adjustments for unconsolidated partnerships
         and joint ventures. Management uses FFO as a supplemental performance
         measure because, in excluding real estate depreciation and
         amortization and gains and losses from property dispositions, it
         provides a performance measure that, when compared year over year,
         captures trends in occupancy rates, rental rates and operating costs.
         We also believe that, as a widely recognized measure of the
         performance of REITs, FFO will be used by investors as a basis to
         compare our operating performance with that of other REITs. However,
         because FFO excludes depreciation and amortization and captures
         neither the changes in the value of our properties that results from
         use or market conditions nor the level of capital expenditures and
         leasing commissions necessary to maintain the operating performance of
         our properties, all of which have real economic effect and could
         materially impact our results from operations, the utility of FFO as a
         measure of our performance is limited. Other equity REITs may not
         calculate FFO in accordance with the NAREIT definition and,
         accordingly, our FFO may not be comparable to such other REITs' FFO.
         Accordingly, FFO should be considered only as a supplement to net
         income as a measure of our performance. FFO should not be used as a
         measure of our liquidity, nor is it indicative of funds available to
         fund our cash needs, including our ability to pay dividends. FFO
         should not be used as a supplement to or substitute for cash flow from
         operating activities computed in accordance with GAAP. FFO per
         share - diluted is calculated by dividing FFO by the average number of
         fully diluted shares outstanding during the quarter ended, March 31,
         2007.
 
     Mary Jensen, Vice President - Investor Relations
     310.255.7751, or mjensen@douglasemmett.com
 
 

SOURCE Douglas Emmett, Inc.

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