Feldman Mall Properties, Inc. Reports Fourth Quarter 2006 Financial Results Conference Call to Discuss Results Will Be Held at 11:00 AM EDT, May 16,

2007 Dial in: (800) 366-8058 or go to www.feldmanmall.com



    GREAT NECK, N.Y., May 14 /PRNewswire-FirstCall/ --
 
     RELEASE HIGHLIGHTS
 
     -- 4th quarter FFO was $0.18 per diluted share
     -- Full year 2006 FFO was $0.80 per diluted share
     -- Completed an agreement to issue up to $50 million of 6.85% convertible
        preferred shares
     -- Completed unsecured credit agreement to borrow up to $25 million
        through a 7% promissory note
     -- Completed the refinancing of the Stratford Square Mall for $104.5
        million
     -- Declared first quarter dividend of $0.2275 per share
 
     FINANCIAL RESULTS
     Feldman Mall Properties, Inc. (NYSE:   FMP) today reported Funds From
 Operations ("FFO") totaling $2.7 million, or $0.18 per diluted share, for
 the fourth quarter ended December 31, 2006 as compared to $2.1 million, or
 $0.15 per diluted share for the three months ended December 31, 2005. The
 Company's net loss for the three months ended December 31, 2006 was $1.0
 million, or $0.08 per share, as compared to a loss of $2.1 million, or
 $0.17 per share for the fourth quarter of 2005. The Company had 14.6 and
 14.2 million weighted average common shares and operating partnership units
 outstanding during the fourth quarters ended December 31, 2006 and 2005,
 respectively.
     For the year ended December 31, 2006, FFO totaled $11.7 million, or
 $0.80 per diluted share as compared to $10.9 million, or $0.78 per diluted
 share for the year ended December 31, 2005. Excluding the early
 extinguishment of debt during the second quarter of 2006 totaling
 approximately $0.4 million, FFO totaled $12.1 million, or $0.83 per diluted
 share. The Company's net income for the year ended December 31, 2006 was
 $20.2 million, or $1.54 per diluted share, as compared to a net loss of
 $2.6 million, or $0.21 per share for the year ended December 31, 2005. The
 Company had 14.7 and 14.1 million weighted average common shares and
 operating partnership units outstanding during the year ended December 31,
 2006 and 2005, respectively. The results for the year ended December 31,
 2006 includes a $29.4 million gain on the partial sale of the Foothills
 Mall.
     REAL ESTATE AND FINANCING ACTIVITY
     $104.5 Million Stratford Square Refinancing
     The Company announced today the refinancing of the Stratford Square
 Mall, located in Bloomingdale, Illinois. The $104.5 million first mortgage
 closed May 8, 2007 with an initial term of 36 months and bearing interest
 at a
     floating rate of 115 basis points over LIBOR. The loan has two one-year
 extension options.
     On the closing date, $75 million of the loan proceeds were used to
 retire Stratford Square's outstanding $75 million first mortgage. The
 balance of the proceeds was placed into escrow and will be released to the
 Company to fund the completion of its redevelopment project.
     $50 Million of Convertible Preferred Shares
     The Company intends to issue up to $50 million of convertible preferred
 stock through the private placement of 2 million shares of 6.85% Series A
 Cumulative Convertible Preferred Shares to Inland American Real Estate
 Trust, Inc., a public non-listed REIT sponsored by an affiliate of the
 Inland Real Estate Group of Companies. Pursuant to the terms of the
 agreement, the Company issued $15 million of preferred stock on April 30,
 2007. The Company is required to issue a total of $50 million by the end of
 the 12 month period following the close of this transaction.
     Under the terms of this transaction, and in accordance with New York
 Stock Exchange rules, the Company will seek shareholder approval to permit
 conversion of the preferred shares into common stock. Assuming an
 affirmative vote of Company shareholders, Inland American Real Estate Trust
 will have the option after June 30, 2009 to convert some or all of its
 outstanding preferred shares. Each preferred share is being issued at a
 price of $25.00 per share and, assuming an affirmative vote of Company
 shareholders, will be convertible, in whole or in part, at a conversion
 ratio of 1.77305 common shares to preferred shares. This conversion ratio
 is based upon a common share price of $14.10 per share. Assuming
 stockholder approval of convertibility, and if the preferred shareholders
 do not convert their shares to common stock, then commencing August of
 2009, the Company may redeem the preferred shares without any redemption
 premium at the price of $25.00 per share. For more details regarding this
 transaction, please refer to the Company's 8-K filing dated April 16, 2006.
     The Company intends to utilize the net proceeds from the offering to
 provide capital for the redevelopment of its mall assets, to repay
 borrowings under its line of credit and for general corporate purposes.
     $25 Million Credit Agreement with an Affiliate of Kimco Realty
 Corporation
     The Company has executed a promissory note (the "Note") providing for
 loans aggregating up to $25 million from Kimco Capital Corp. ("Kimco"). No
 amount has yet been borrowed under the Note.
     Loan draws under the Note are optional on the part of the Company and
 will bear interest at the rate of seven percent per annum, payable monthly.
 Any outstanding principal amount will be due and payable on April 10, 2008,
 provided that the maturity of the Note may be extended to April 10, 2009 if
 the Company complies with certain performance criteria. The Company may
 prepay the outstanding principal amount under the Note in whole or in part
 at any time.
     In addition to the interest on the Note, Kimco will be paid a variable
 fee equal to (i) $500,000, multiplied by (ii) (a) the volume weighted
 average price of the Company's common stock as of a five-day period chosen
 by Kimco, minus (b) $13.00 per common share. If Kimco does not select a
 date for determination of the fee prior to termination of the Note, the
 Company will instead pay to Kimco $250,000 in additional interest.
     The Company intends to utilize the Kimco proceeds to provide capital
 for the redevelopment of its mall assets, to repay borrowings under its
 line of credit and for general corporate purposes.
     OTHER
     Appointment of New Board Member
     In connection with the Inland transaction, Mr. Thomas H. McAuley will
 be joining the Company's board of directors. Mr. McAuley, age 61, has been
 a Director of Inland Real Estate Corp. since 2004. Mr. McAuley is also
 currently the president of Inland Capital Markets Group, Inc., which is an
 advisor on real estate investments, including public REITs, to various
 entities within The Inland Real Estate Group of Companies, Inc.
     In order for the Company's Board of Directors to comply with the
 director independence rules of the New York Stock Exchange, Jim Bourg will
 resign his board seat prior to Mr. McAuley joining the Company's board. Jim
 Bourg will continue to be the Company's Chief Operating Officer and will
 attend all future board meetings.
     First Quarter Dividend of $0.2275 Per Share
     The Company announced that its Board of Directors has declared a
 quarterly dividend of $0.2275 per common share for the quarter ending March
 31, 2007. The dividend is payable on May 25, 2007 to shareholders of record
 at the close of business on May 18, 2007.
     Management's Internal Control Assessment
     As of December 31, 2006, the Company's management has determined that
 its controls over financial reporting contained a material weakness. The
 Company lacked the sufficient number of personnel to ensure that the
 financial statements were prepared on a timely basis. As a result, the
 Company was unable to adequately complete its necessary procedures on time.
 The lack of sufficient personnel caused delays in the review and approval
 of supporting documents and journal entries necessary to prepare our
 financial statements on a timely basis in accordance with regulatory
 guidelines. At the beginning of 2007 management commenced hiring and
 training additional personnel to correct this material weakness.
     CONFERENCE CALL/WEBCAST
     The Company's executive management team, led by Larry Feldman, chairman
 and chief executive officer, and Tom Wirth, executive vice-president and
 chief financial officer, will host a conference call and audio web cast on
 Wednesday, May 16, 2007 at 11:00 a.m. EDT to discuss the Company's
 financial results. The conference call may be accessed by dialing (800)
 366-8058. No pass code is required. The live conference will be
 simultaneously broadcast in a listen-only mode on the Company's website at
 www.feldmanmall.com.
     A replay of the call will be available for a limited time by dialing
 (800) 405-2236 and using the pass code 11090288, or individuals may access
 the replay via the Company's web site.
     NON-GAAP FINANCIAL MEASURES
     Feldman Mall Properties, Inc., consistent with real estate industry and
 investment community preferences, uses FFO as a supplemental measure of
 operating performance. The National Association of Real Estate Investment
 Trusts (NAREIT) defines FFO as net income (loss) (computed in accordance
 with Generally Accepted Accounting Principles (GAAP)), excluding gains (or
 losses) from cumulative effects of accounting changes, extraordinary items
 and sales of depreciable properties, plus real estate related depreciation
 and amortization and after adjustments for unconsolidated partnerships and
 joint ventures.
     The Company considers FFO a supplemental measure for equity REITs and a
 complement to GAAP measures because it facilitates an understanding of the
 operating performance of the Company's properties. FFO does not give effect
 to real estate depreciation and amortization since these amounts are
 computed to allocate the cost of a property over its useful life. Since
 values for well-maintained real estate assets have historically increased
 or decreased based upon prevailing market conditions, the Company believes
 that FFO provides investors with a clearer view of the Company's operating
 performance.
     In order to provide a better understanding of the relationship with FFO
 and GAAP net income, a reconciliation of FFO to GAAP net income has been
 provided on page 6 of this release. FFO does not represent cash flow from
 operating activities in accordance with GAAP, should not be considered as
 an alternative to GAAP net income and is not necessarily indicative of cash
 available to fund cash needs.
     During the May 16, 2007 conference call, the Company may discuss
 non-GAAP financial measures as defined by SEC Regulation G. In addition,
 the Company
     has used a non-GAAP financial measure and the comparable GAAP financial
 measure (net income) can be found on page 6 of this release.
     *Financial Tables Attached
     Feldman Mall Properties, Inc. acquires, renovates and repositions
 enclosed regional shopping malls. Feldman Mall Properties Inc.'s investment
 strategy is to opportunistically acquire underperforming malls and
 transform them into physically attractive and profitable Class A malls
 through comprehensive renovation and re-tenanting efforts aimed at
 increasing shopper traffic and tenant sales. For more information on
 Feldman Mall Properties Inc., visit the Company's website at
 http://www.feldmanmall.com.
     The Company's portfolio, including non-owned anchor tenants, consists
 of seven regional malls aggregating approximately 7.0 million square feet
 of which the Company owns approximately 4.6 million square feet.
     To receive the Company's latest news releases and other corporate
 documents, please contact the Company at (516) 684-1239. All releases and
 supplemental data can also be downloaded directly from the Feldman Mall
 Properties website at: http://www.feldmanmall.com.
     Forward-looking Information
     This press release contains forward-looking statements that involve
 risks and uncertainties regarding various matters, including, without
 limitation, the success of our business strategy, including our
 acquisition, renovation and repositioning plans; our ability to close
 pending acquisitions and the timing of those acquisitions; our ability to
 obtain required financing; our understanding of our competition; market
 trends; our ability to implement our repositioning plans on time and within
 our budgets; projected capital and renovation expenditures; demand for shop
 space and the success of our lease-up plans; availability and
 creditworthiness of current and prospective tenants; and lease rates and
 terms. The forward-looking statements are based on our assumptions and
 current expectations of future performance. These assumptions and
 expectations may be inaccurate or may change as a result of many possible
 events or factors, not all of which are known to us. If there is any
 inaccuracy or change, actual results may vary materially from our forward-
 looking statements.
                         FELDMAN MALL PROPERTIES, INC.
 
                          CONSOLIDATED BALANCE SHEETS
 
                (In Thousands, Except Share and Per Share Data)
 
                                                  December 31,     December 31,
                                                      2006             2005
 
     Assets:
     Investments in real estate, net               $  318,440       $  396,108
     Investment in unconsolidated real estate
      partnerships                                     33,150            3,153
     Cash and cash equivalents                         13,036           14,331
     Restricted cash                                    8,159            7,707
     Rents, deferred rents and other receivables, net   5,718            5,763
     Acquired below-market ground lease, net            7,674            7,811
     Acquired lease rights, net                         9,262           14,205
     Acquired in-place lease values, net               10,049           19,098
     Deferred charges, net                              3,284            2,843
     Other assets, net                                  5,396            4,466
 
     Total Assets                                  $  414,168       $  475,485
 
 
     Liabilities and Stockholders' Equity:
     Mortgage loans payable                        $  211,451       $  318,489
     Junior subordinated debt obligation               29,380               -
     Due to affiliates                                  3,891            5,303
     Accounts payable, accrued expenses, and other
      liabilities                                      25,832           19,672
     Dividends and distributions payable                3,315            3,331
     Acquired lease obligations, net                    6,823           11,612
     Deferred gain on partial sale of real estate       3,832               -
     Negative carrying value of investment in
      unconsolidated partnership                        4,450               -
 
     Total liabilities                                288,974          358,407
 
     Minority interest                                 11,433           12,117
 
     Stockholders' Equity
     Common stock ($0.01 par value, 200,000,000 shares
      authorized, 13,155,062 and 13,050,370 issued and
      outstanding at December 31, 2006 and 2005,
      respectively)                                       132              131
     Additional paid-in capital                       120,379          119,643
     Distributions in excess of earnings               (7,637)         (15,912)
     Accumulated other comprehensive income               887            1,099
 
     Total stockholders' equity                       113,761          104,961
 
     Total Liabilities and Stockholders' Equity    $  414,168       $  475,485
 
 
 
 
                         FELDMAN MALL PROPERTIES, INC.
                CONSOLIDATED STATEMENTS OF OPERATIONS-UNAUDITED
 
                     (In Thousands, Except Per Share Data)
 
                               Three Months Ended          Twelve Months Ended
 
                                  December 31,                  December 31,
                                2006       2005               2006       2005
     Revenue:
      Rental                   $8,984    $12,081            $41,104    $35,729
      Tenant reimbursements     4,172      5,587             19,867     17,634
      Management, leasing, and
       development services       870        114              1,310        470
      Interest and other income   723        616              3,024      1,362
       Total Revenue           14,749     18,398             65,305     55,195
 
     Expenses:
      Rental property operating
       and maintenance          4,766      6,845             21,014     18,383
      Real estate taxes         1,414      2,097              7,645      6,520
      Interest (including
       amortization of deferred
       financing costs)         3,252      4,110             16,435     11,909
      Loss from early
       extinguishment of debt       -          -                357          -
      Depreciation and
       amortization             3,555      4,227             17,394     13,383
      General and
       administrative           3,003      3,278              8,657      7,511
        Total Expenses         15,990     20,557             71,502     57,706
 
      Equity in income (loss) of
       unconsolidated real estate
       partnerships               104       (162)              (550)      (454)
      Gain on partial sale
       of real estate               -          -             29,397          -
      Income (loss) before
       minority interest       (1,137)    (2,321)            22,650     (2,965)
      Minority interest           111        259             (2,469)       332
     Net Income (Loss)        $(1,026)   $(2,062)           $20,181    $(2,633)
 
 
     Basic earnings (loss)    $ (0.08)   $ (0.17)           $  1.58    $ (0.21)
     per share
     Diluted earnings
     (loss) per share          $(0.08)    $(0.17)           $  1.54    $ (0.21)
 
     Basic weighted average
      common shares
      outstanding              12,821     12,466             12,808     12,363
 
     Diluted weighted average
      common shares and
      common share
      equivalents outstanding  12,821     12,466             14,666     12,363
 
     Funds From Operations
      (FFO) Calculation:
     Net income (loss)        $(1,026)   $(2,062)           $20,181    $(2,633)
 
     Add:
     Depreciation and
      amortization              3,555      4,227             17,394     13,383
     Joint venture FFO            337        216              1,377        729
      adjustment
     Minority interest of
      income (loss)              (111)      (259)             2,469       (332)
 
     Less:
     Gain on partial sale
      of real estate                -          -            (29,397)         -
     Depreciation of non-
      real estate assets          (78)       (50)              (280)      (247)
     FFO, diluted              $2,677     $2,072            $11,744    $10,900
     Debt extinguishment
      related to partial sale       -          -                357          -
 
     FFO, before charges for debt
      extinguishment           $2,677     $2,072            $12,101    $10,900
 
     FFO per share              $0.18      $0.15              $0.80      $0.78
 
     FFO per share, before
      charges for debt
      extinguishment            $0.18      $0.15              $0.83      $0.78
 
     Ownership interests:
      Weighted average REIT
       common shares for basic
       net income per share    12,821     12,466             12,808     12,363
     Weighted average common
      stock equivalents and
      partnership units         1,779      1,769              1,858      1,700
     Weighted average shares
      and units outstanding    14,600     14,235             14,666     14,063
 
 
 
                         FELDMAN MALL PROPERTIES, INC.
                              OPERATING STATISTICS
 
                               December 31, 2006
 
             Property               Total    Rentable               Annualized
            (Ownership             Square     Square    Total Mall     Base
            Interest)               Feet     Feet (A)  Occupancy(C)    Rent
     Stratford Square (100%)     1,300,000   629,000     90.6%     $5,990,680
     Tallahassee Mall (100%)       966,000   966,000     96.0       7,249,332
     Northgate Mall (100%)       1,100,000   577,000     90.9       7,804,935
     Golden Triangle Mall (100%)   765,000   288,000     94.2       3,087,392
     Foothills Mall (30.8%)        711,000   502,000     98.6       7,810,682
     Colonie Center Mall (25.0%) 1,200,000   668,000     93.2       7,573,996
     Harrisburg Mall (25.0%)       922,000   922,000     88.3       5,015,975
       Total/Weighted Avg.       6,964,000 4,552,000     93.1%    $44,532,992
 
                                                                     Shop
                                      Shop           Shop           Tenant
               Property              Tenant         Tenants        Base Rent
              (Ownership             Square       Percentage      Per Leased
               Interest)              Feet        Leased (B)        Sq. Ft.
     Stratford Square (100%)          485,000        66.4 %        $24.81
     Tallahassee Mall (100%)          204,000        79.0           22.60
     Northgate Mall (100%)            315,000        67.6           23.55
     Golden Triangle Mall (100%)      171,000        66.0           20.35
     Foothills Mall (30.8%)           230,000        96.4           21.48
     Colonie Center Mall (25.0%)      336,000        78.0           27.40
     Harrisburg Mall (25.0%)          270,000        58.8           24.46
          Total/Weighted Avg.       2,011,000        75.6 %        $23.74
 
     (A) - Represents owned square feet
     (B) - Excludes temporary tenants
     (C) - Includes temporary tenants
 
 
 
                                                           % of
                    Lease       Number of   Expiring       Total     Expiring
                 Expiration     Expiring    Rentable      Sq. Ft.      Base
                    Year         Leases       Area       Expiring      Rent
                    2007           69       183,373        5.33 %    $290,317
                    2008           84       357,069        10.37      366,130
                    2009           68       181,626         5.28      314,725
                    2010           58       208,211         6.05      342,802
                    2011           63       251,885         7.32      425,246
                    2012           32       249,834         7.26      237,028
                    2013           35       326,337         9.48      325,143
                    2014           33       307,085         8.92      362,970
                    2015           22        90,651         2.63      147,337
     2016 and thereafter           48     1,285,990        37.36      854,187
           Total/Average          512     3,442,061      100.00 %  $3,665,885
 
                                                  % of           Expiring
                    Lease      Annualized         Total         Base  Rent
                 Expiration       Base            Base           Per Sq.
                    Year          Rent            Rent             Ft.
                    2007      $3,483,808          7.92%          $19.00
                    2008       4,393,557          9.99            12.30
                    2009       3,776,696          8.59            20.79
                    2010       4,113,622          9.35            19.76
                    2011       5,102,947         11.60            20.26
                    2012       2,844,337          6.47            11.38
                    2013       3,901,718          8.87            11.96
                    2014       4,355,638          9.90            14.18
                    2015       1,768,042          4.02            19.50
     2016 and thereafter      10,250,239         23.30             7.97
           Total/Average     $43,990,604         100.0%          $12.78
 
 
 
                        Same Store Sales Per Square Foot
                         Trailing Twelve Months Ending
 
                      12/31/06    9/30/06    6/30/06     3/31/06   12/31/05
 
         Stratford     $284.31    $283.33    $282.70     $281.91   $278.58
         Tallahassee    320.32     329.34     329.64      332.88    335.41
         Northgate      308.42     309.63     308.27      306.13    306.55
         Foothills      305.77     306.03     302.35      305.28    304.73
         Colonie        308.02     299.71     299.95      301.10    302.62
         Harrisburg     266.61     260.31     255.03      253.10    252.31
         Total/Average $298.91    $298.06    $296.32     $296.73   $296.70
 
     Golden Triangle is not included
 
 
 
              Same Store In-Line Occupancy with Temporary Tenants
                         Trailing Twelve Months Ending
 
                       12/31/06    9/30/06     6/30/06      3/31/06    12/31/05
         Stratford       82.3%      75.9%       73.7%        76.3%       80.3%
         Tallahassee     88.0       88.0        88.1         88.9        88.9
         Northgate       90.2       90.1        84.7         85.4        87.1
         Foothills      100.0       96.5        96.5         96.5        97.5
         Colonie         89.2       90.4        88.9         88.9        89.3
         Harrisburg      75.2       80.8        77.9         77.8        77.4
         Total/Average   88.8%      85.8%       85.0%        85.7%       86.8%
 
 

SOURCE Feldman Mall Properties, Inc.

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.