NEW YORK (
) -- Shares of
DCT Industrial Trust
fell as much as 7% Friday after the real estate investment trust narrowed its guidance for 2010.
DCT shaved its forecast for 2010 funds from operations, or FFO, by a penny a share at the high and low ends of its previously disclosed range. The operator of light industrial properties now expects to post FFO of 38 cents to 42 cents a share, compared with its prior forecast of 37 cents to 43 cents.
FFO is a performance figure generally used by REITs to define cash flow from operations.
The Denver-based REIT also lowered its net earnings per share guidance to a loss of 9 cents to 13 cents, compared with previous guidance of a 5-cent to 11-cent loss. The consensus among Wall Street analysts had called for a full-year loss of 11 cents.
DCT's somber outlook came as the firm's red ink more than doubled year-over year, widening to $10.7 million, or 5 cents a share, from $4 million, or 2 cents a share.
In a statement, CEO Phil Hawkins said, "Several anticipated vacancies combined with a disproportionate share of leases expiring in the first quarter led occupancy to decline 230 basis points as expected," though he believes rent and vacancy rates have reached bottom. "Our long-term outlook remains positive based on these trends as well as the improvement in leading indicators of industrial demand."
Investors were clearly unimpressed with Hawkins' optimistic view, sending DCT shares down 6.7% at one point in Friday's session. The stock rebounded somewhat, coming off session lows in line with the overall market, and finishing down by just 2.4%, at $4.82.
Elsewhere in the small-cap REIT sector, shares of
( AMB) earlier fell as much as 3.2% Friday before closing lower by just 0.7%. The San Francisco-based industrial REIT said last month that its FFO fell to 30 cents per shares, from 37 cents in the year-earlier period.
Like DCT, AMB also lowered its core FFO guidance for 2010, saying it now expects the key metric to fall between $1.20 and $1.26 per share, down from its prior guidance for FFO of $1.26 to $1.33 per share.
Developers Diversified Realty
, which manages malls and shopping centers, saw its shares fall 4.3% Friday before closing off by just 2.1%. Earlier this week, the Beachwood, Ohio-based REIT reaffirmed its 2010 guidance for FFO between $1.00 and $1.05 per share, topping analysts' consensus call for FFO of 89 cents. Improving business activity and an investment gain helped it narrow its quarterly operating losses, with an FFO loss of 13 cents per share for the recent quarter, compared with a year-earlier loss of $1.15 per share.
iShares FTSE NAREIT Ind/Off Capp
, an exchange-traded fund that counts AMB among its top holdings and has 2.1% of its portfolio invested in DCT, closed 1.5% lower on Friday. The
iShares FTSE NAREIT Retail Capp
, an ETF with DDR among its top holdings, lost 2%.
-- Reported by Miriam Marcus Reimer from New York.
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