DENVER, May 1 /PRNewswire-FirstCall/ -- DCT Industrial Trust Inc.(NYSE: DCT), a leading industrial real estate investment trust, todayannounced financial results for the quarter ended March 31, 2008.
Funds from operations (FFO) attributable to common stockholders totaled$30.2 million, or $0.15 per diluted share, for the first quarter of 2008,compared to $33.3 million, or $0.17 per diluted share, reported for the firstquarter of 2007.
Net income attributable to common stockholders for the first quarter of2008 was $0.4 million, or $0.00 per diluted share, compared to $15.4 million,or $0.09 per diluted share, reported for the first quarter of 2007. Firstquarter 2008 net income includes approximately $0.8 million of gains on thecontribution or sale of real estate, of which $0.2 million was recognized inFFO, which compares to $17.4 million of gains on the contribution or sale ofreal estate included in net income in the first quarter of 2007, of which $3.7million was included in FFO.
Phil Hawkins, Chief Executive Officer of DCT Industrial, commented, 'Whilesigns of a slowing U.S. economy are becoming more apparent, our leasingactivity, rental rate growth and tenant retention remain healthy. Withdisruptions in the credit markets continuing and the economy softening, wecontinue to believe that interesting investment opportunities will presentthemselves later in 2008 or 2009, and we are well positioned to capitalize onthose opportunities with our strong balance sheet and proven organization.'
Operating Portfolio
As of March 31, 2008, the Company owned 381 consolidated operatingproperties, or 53.5 million square feet, compared to 367 consolidatedoperating properties, or 53.8 million square feet, as of March 31, 2007. Netoperating income was $48.1 million in the first quarter of 2008, down slightlyfrom $48.5 million reported for the first quarter of 2007, primarily due toasset sales and contributions. DCT Industrial's consolidated operatingportfolio occupancy was 93.2% at March 31, 2008, compared to 93.1% at March31, 2007. Including an additional 12.5 million square feet of operatingproperties held in joint ventures, occupancy at March 31, 2008 was 94.3%, upfrom 93.7% a year ago.
Same store net operating income decreased 0.6% on both a cash basis and ona GAAP basis in the first quarter of 2008, when compared to the same periodlast year, primarily due to higher bad debt expense related to a tenantbankruptcy. Occupancy of same store properties was 93.3% as of March 31,2008, compared to 92.9% as of March 31, 2007.
DCT Industrial signed 1.9 million square feet of leases during the firstquarter. Tenant retention continued to be favorable, with a rate of 72.0% forthe first quarter of 2008. Realized rent growth on signed leases for whichthere was a prior tenant averaged 11.1% on a GAAP basis and 2.4% on a cashbasis in the first quarter of 2008.
Institutional Capital Management
The Company's institutional capital management business had assets undermanagement of $737.5 million at March 31, 2008, representing an increase of$51.3 million during the first quarter, and an increase of $379.5 million fromMarch 31, 2007. Capital management and other fee revenue totaled $0.9 millionin the first quarter of 2008, compared to $0.7 million in the first quarter of2007.
Investment, Disposition and Development Activity
'In the first quarter, our capital deployment activity was consistent withour business plan outlined at the beginning of the year,' said Phil Hawkins.'We didn't acquire any operating properties on balance sheet and we have beenactively marketing a number of assets for disposition and have received solidinterest from potential buyers.'
As of March 31, 2008, DCT Industrial had 9.2 million square feet underdevelopment. During the first quarter, the Company contributed approximately50 acres in Atlanta to a development joint venture with IndustrialDevelopments International, which will support approximately 600,000 squarefeet of development, and initiated development of a 1.0 million square footbulk distribution building at SCLA (Southern California Logistics Airport).
Progress continued in Mexico as the Company took ownership of 547,000square feet of industrial buildings during the first quarter of 2008 under itsforward commitment with Nexxus in Monterrey. In addition, due to the successof leasing, DCT Industrial initiated development of an additional 482,000square feet of industrial buildings in Monterrey, of which 128,000 square feetis pre-leased. To date, the Company has developed or is constructing1.4 million square feet in Monterrey and has experienced excellent activity,with more than 700,000 square feet of executed leases or building sales tousers over the past 15 months.
'Two main areas of focus for development, Mexico and SCLA, continued toperform well during the first quarter.' said Jim Cochran, President and ChiefInvestment Officer of DCT Industrial. 'Leasing activity remains strong inMexico and we are pleased with the level of interest from users to eitherlease space or acquire land for their own facilities at SCLA.'
Balance Sheet
During the first quarter, DCT Industrial exercised a five-year extensionoption on $175 million of a senior unsecured note, originally scheduled tomature in June 2008, at a rate of 6.11%. DCT Industrial's balance sheetremains strong, with consolidated debt to book value of total assets (beforedepreciation and amortization) of 38.2% as of March 31, 2008, compared to37.4% at December 31, 2007.
Guidance
DCT Industrial has reaffirmed its 2008 guidance of FFO per diluted shareof $0.68 to $0.73 and net income of $0.13 to $0.18 per diluted share.
Conference Call Information
DCT Industrial will host a conference call to discuss first quarterresults and its recent business activities on Friday, May 2, 2008 at 12:00 PMEastern. Stockholders and interested parties may listen to a live broadcastof the conference call by dialing (800) 860-2442 or (412) 858-4600. Atelephone replay will be available for one week following the call by dialing(877) 344-7529 or (412) 317-0088 and entering the passcode: 418012. A livewebcast and replay of the conference call will be available on the investorrelations page of DCT's website at http://www.dctindustrial.com.
Supplemental information will be available in the Investor Relationssection of the Company's website at http://www.dctindustrial.com or by e-mailrequest at investorrelations@dctindustrial.com. Interested parties may alsoobtain supplemental information from the SEC's website at http://www.sec.gov.
About DCT Industrial Trust
DCT Industrial Trust Inc. is a leading industrial real estate company thatowns, operates and develops high-quality bulk distribution and lightindustrial properties in high-volume distribution markets in the U.S. andMexico. As of March 31, 2008, the Company owned, managed or had underdevelopment 76.9 million square feet of assets leased to approximately 850corporate customers, including 12.1 million square feet managed on behalf ofthree institutional joint venture partners.
