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Douglas Emmett Inc. Reports Operating Results (10-Q)

November 04, 2010 | About:
10qk

10qk

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Douglas Emmett Inc. (DEI) filed Quarterly Report for the period ended 2010-11-04.

Douglas Emmett Inc. has a market cap of $2.17 billion; its shares were traded at around $17.61 with a P/E ratio of 13.2 and P/S ratio of 3.7. The dividend yield of Douglas Emmett Inc. stocks is 2.2%.DEI is in the portfolios of Ron Baron of Baron Funds, Chris Davis of Davis Selected Advisers, Bruce Kovner of Caxton Associates, Manning & Napier Advisors, Inc, Steven Cohen of SAC Capital Advisors, Jim Simons of Renaissance Technologies LLC, Jeremy Grantham of GMO LLC, Pioneer Investments, George Soros of Soros Fund Management LLC.

Highlight of Business Operations:

Office Rental Revenue. Rental revenue includes rental revenues from our office properties, percentage rent on the retail space contained within office properties, and lease termination income. Total office rental revenue increased by $2.0 million, or 2.1%, to $101.5 million for the three months ended September 30, 2010, compared to $99.5 million for the three months ended September 30, 2009. The increase is primarily due to $4.0 million of incremental rent from the property we acquired during the second quarter of 2010, partially offset by a decrease of $2.0 million for the remainder of our portfolio. The decrease of $2.0 million is primarily due to decreases in occupancy and average rental rates, and from lower accretion of net below-market rents. Each of the leases in place at the time of our initial public offering (IPO) was adjusted to then-market rates. As we progress further from the IPO date, the maturity and expiration of these leases will result in lower comparable rent adjustments.

Office Rental Expenses. Total office rental expense increased by $4.8 million, or 12.3%, to $43.4 million for the three months ended September 30, 2010, compared to $38.7 million for the three months ended September 30, 2009. The increase is primarily due to $3.6 million of incremental expense from the property we acquired during the second quarter of 2010, as well as an increase of $1.2 million for the remainder of our portfolio. The $1.2 million increase is primarily due to an increase in utilities expense, as well as higher in real estate tax expense due to an increase in ancillary property tax assessments, partially offset by temporary reductions in the taxable value of certain properties under California s Proposition 8.

Office Rental Revenue. Total office rental revenue decreased by $8.3 million, or 2.7%, to $299.0 million for the nine months ended September 30, 2010, compared to $307.2 million for the nine months ended September 30, 2009. The decrease is primarily due to $7.6 million of rent reflected in our 2009 consolidated results from the six properties we contributed to the institutional fund that was deconsolidated at the end of February 2009, as well as a decrease of $4.8 million for the remainder of our portfolio, partially offset by $4.1 million of incremental rent from the property we acquired during the second quarter of 2010. The $4.8 million decrease for the remainder of our portfolio is primarily due to lower accretion of net below-market rents, and decreases in occupancy and rental rates.

Parking and Other Income. Total office parking and other income decreased by $1.1 million, or 2.2%, to $48.9 million for the nine months ended September 30, 2010, compared to $50.0 million for the nine months ended September 30, 2009. The decrease is primarily due to $1.2 million of parking income reflected in our 2009 consolidated results from the six properties we contributed to the institutional fund that was deconsolidated at the end of February 2009, as well as decreases in parking income of $1.6 million for the remainder of our portfolio as a result of lower occupancy, partially offset by $1.7 million of incremental revenue from the property we acquired during the second quarter of 2010.

Office Rental Expenses. Total office rental expense increased by $1.1 million, or 0.9%, to $116.8 million for the nine months ended September 30, 2010, compared to $115.7 million for the nine months ended September 30, 2009. The increase is primarily due to $3.7 million of incremental expense from the property we acquired during the second quarter of 2010, as well as $0.6 million from the remainder of our portfolio, partially offset by $3.2 million in office rental expenses reflected in our 2009 consolidated results from the six properties we contributed to the institutional fund that was deconsolidated at the end of February 2009. The increase for the remainder of our portfolio is primarily due to higher real estate tax expense as a result of an increase in ancillary property tax assessments and higher taxable values for the majority of our properties, partially offset by temporary reductions in the taxable value of certain properties under California s Proposition 8.

Depreciation and Amortization. Depreciation and amortization expense decreased $4.5 million, or 2.6%, to $167.9 million for the nine months ended September 30, 2010, compared to $172.3 million for the nine months ended September 30, 2009. The decrease is primarily due to $4.9 million in depreciation and amortization reflected in our 2009 consolidated results from the six properties in the institutional fund that was deconsolidated at the end of February 2009, as well a decrease in depreciation expense of $1.9 million for the remainder of our portfolio due to certain assets being fully depreciated, partially offset by $2.3 million of incremental depreciation from the property we acquired during the second quarter of 2010.

Read the The complete Report

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