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Post Properties Inc. has a market cap of $1.26 billion; its shares were traded at around $26.02 with and P/S ratio of 4.58. The dividend yield of Post Properties Inc. stocks is 3.07%.PPS is in the portfolios of Stanley Druckenmiller of Duquesne Capital Management, LLC, Pioneer Investments.
Highlight of Business Operations: Post Properties, Inc. and its subsidiaries develop, own and manage upscale multi-family communities in selected markets in the United States. As used in this report, the term “Company” includes Post Properties, Inc. and its subsidiaries, including Post Apartment Homes, L.P. (the “Operating Partnership”), unless the context indicates otherwise. The Company, through its wholly-owned subsidiaries is the general partner and owns a majority interest in the Operating Partnership which, through its subsidiaries, conducts substantially all of the on-going operations of the Company. At June 30, 2010, the Company owned 19,863 apartment units in 55 apartment communities, including 1,747 apartment units in five communities held in unconsolidated entities and 396 apartment units in one community currently in lease-up. The Company is also developing and selling 277 luxury for-sale condominium homes in two communities (including 129 units in one community held in an unconsolidated entity) through taxable REIT subsidiaries. At June 30, 2010, approximately 35.4%, 23.1%, 11.2% and 10.8% (on a unit basis) of the Company’s operating communities were located in the Atlanta, Dallas, the greater Washington D.C. and Tampa metropolitan areas, respectively.
At June 30, 2010, the Company owned approximately 99.7% of the common limited partnership interests (“Common Units”) in the Operating Partnership. Common Units held by persons other than the Company represented a 0.3% common noncontrolling interest in the Operating Partnership.
In recent years, weak economic conditions caused by a severe recession in the U.S. economy and high unemployment has led to declining rental rates for multi-family apartments, as the Company sought to maintain occupancy at historical levels. While these conditions persist in 2010, relative improvement in the U.S. economy has modestly improved consumer confidence and demand for multi-family apartments in the Company’s markets. This modest improvement in demand, coupled with moderating new supply of multi-family apartments, has contributed to a moderation in the year-over-year rate of decline in rental revenues during the first half of 2010. Consistent with these factors, year-over-year rate same store operating revenues declined 3.0% for the second quarter of 2010, as compared to a decline of 4.6% during the first quarter of 2010. Year-over-year same store NOI also declined 5.3% for the second quarter of 2010, as compared to a decline of 7.9% during the first quarter of 2010. The revenue decrease was attributable to declining rental rates, which on a year-over-year basis decreased by 6.0% during the first six months of 2010, offset by an increase in average economic occupancy from 93.5% during the first six months of 2009 to 95.1% during the first six months of 2010. The Company’s outlook for same store community revenues and net operating income (“NOI”) for 2010 is more fully discussed in the “Outlook” section below. While the U.S. economy has begun to show some signs of recovery, the U.S. economic recovery is in its early stages and any recovery in employment is expected to be modest in 2010. If the economic recovery were to stall or U.S. economic conditions were to worsen, the Company’s operating results would be adversely affected.
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