First Potomac Realty Trust (NYSE: FPO), a leader in the ownership, management, development and redevelopment of office and industrial properties in the greater Washington, D.C. region, reported results for the three and six months ended June 30, 2012.
- Core Funds From Operations of $16.9 million, or $0.32 per diluted share, which includes termination fee income of $1.1 million, or $0.02 per diluted share.
- Same-property net operating income increased by 3.5% on an accrual basis and 3.0% on a cash basis.
- Executed 560,000 square feet of leases, including 147,000 square feet of new leases.
- Increased leased rates over prior quarter to 85.4%, from 84.9%, and occupancy rates to 84.0%, from 83.0%.
- Prepaid the entire $75.0 million principal balance of its Series A and Series B Senior Notes and paid a $10.2 million make-whole amount associated with the prepayment.
Douglas J. Donatelli, Chairman and CEO of First Potomac Realty Trust, stated “Our focus this quarter was continuing to lease up our portfolio, refining our capital plan to better align our balance sheet with our business strategy, implementing steps to remediate the material weakness disclosed in our 10-K and completing the internal investigation. We made good progress on these initiatives, and we are especially pleased that we were able to increase our occupancy to 84%, a more than 300 basis point increase over the second quarter of last year.”
Core FFO increased for the three and six months ended June 30, 2012 compared with the same periods in 2011 primarily due to an increase in the Company’s net operating income. FFO decreased for the three and six months ended June 30, 2012 compared with the same periods in 2011 due to $13.2 million of debt extinguishment charges and $2.5 million of legal and accounting fees associated with the Company’s internal investigation, both of which were incurred during the second quarter of 2012. The debt extinguishment charges and legal and accounting costs also caused the Company’s net loss to increase for the three and six months ended June 30, 2012. The Company’s loss on debt extinguishment and legal and accounting costs associated with its internal investigation are explained in greater detail later in this press release.