UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 2, 2009
REGENCY CENTERS CORPORATION
(Exact name of registrant as specified in its charter)
| Florida | 001-12298 | 59-3191743 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
| One Independent Drive, Suite 114 Jacksonville, Florida |
32202 | |||
| (Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number including area code: (904)-598-7000
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230 .425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 7.01 | Regulation FD Disclosures |
On December 2, 2009 Regency Centers Corporation (“Regency”) affirmed 2009 earnings guidance and provided full year 2010 earnings guidance, which is attached as Exhibit 99.1.
On December 2, 2009 Regency posted on its website at www.regencycenters.com the REG Investor and Analyst Day Presentation of which an excerpt of guidance related information is attached as Exhibit 99.2.
Regency has provided a reconciliation of FFO and recurring FFO guidance to net income, which is attached as Exhibit 99.3.
The information in this item shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference into any disclosure document relating to the company, except to the extent, if any, expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits
| Exhibit 99.1 | Press release relating to earnings guidance issued by Regency on December 2, 2009. | |
| Exhibit 99.2 | Excerpt from the REG Investor and Analyst Day Presentation, which was posted in its entirety on Regency’s website on December 2, 2009. | |
| Exhibit 99.3 | Reconciliation of FFO and Recurring FFO Guidance to Net Income | |
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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| REGENCY CENTERS CORPORATION (registrant) | ||||||||
| Date: December 2, 2009 | By: | /S/ J. CHRISTIAN LEAVITT | ||||||
| J. Christian Leavitt, Senior Vice President, Finance and Principal Accounting Officer | ||||||||
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EXHIBIT 99.1
Regency Centers Corporation
Press Release
| www.RegencyCenters.com | CONTACT: LISA PALMER | |
| (904) 598-7636 |
REGENCY CENTERS ANNOUNCES 2010 EARNINGS GUIDANCE
Jacksonville, Fla. (December 2, 2009) — Regency Centers Corporation (NYSE: REG) today affirmed 2009 earnings guidance and provided full year 2010 earnings guidance in a Form 8-K filing with the Securities and Exchange Commission. Full details are accessible on the Investor Relations Home page of the Company’s corporate website (www.regencycenters.com) under the Quick Links section.
Regency Centers Corporation (NYSE: REG)
Regency is the leading national owner, operator, and developer of grocery-anchored and community shopping centers. At September 30, 2009, the Company owned 409 retail properties, including those held in co-investment partnerships. Including tenant-owned square footage, the portfolio encompassed 54.1 million square feet located in top markets throughout the United States. Since 2000 Regency has developed 194 shopping centers, including those currently in-process, representing an investment at completion of $3.0 billion. Operating as a fully integrated real estate company, Regency is a qualified real estate investment trust that is self-administered and self-managed.
###
Forward-looking statements involve risks and uncertainties. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements. Please refer to the documents filed by Regency Centers Corporation with the SEC, specifically the most recent reports on forms 10K and 10Q, which identify important risk factors which could cause actual results to differ from those contained in the forward-looking statements.
EXHIBIT 99.2
[Slide 1, page 25 of the “REG Investor and Analyst Day Presentation”]
Regency’s Strategy
[Slide 2, page 26 of the “REG Investor and Analyst Day Presentation”]
Current Operating Environment
| • | Economy fragile, recovery gradual - assuming this is new reality |
| – | No return to peak anytime soon |
| – | Patient and steady + disciplined and astute opportunism wins the race |
| – | Impact of economy on leasing - tenant demand is mixed |
| – | Some tenants resuming modest or even robust expansion (REG’s recent high level of leasing activity) |
| – | Failures, closings and move-outs continue at high levels |
| – | Pressure on rents |
| • | Impact of capital markets |
| – | Currently substantial capital available |
| – | Risk in capital markets bubble: future inflation and higher interest rates or refreezing of markets |
| – | Significant capital chasing limited investment opportunities |
| – | Lenders and CMBS servicing agents “kicking can down the road” |
[Slide 3, page 27 of the “REG Investor and Analyst Day Presentation”]
Key Strategic Goals
| • | Generate total shareholder return in excess of FTSE Shopping Center Index |
| • | Build sustainable growth in recurring FFO/PS and NAV by > 5% |
| • | Continue to strengthen the balance sheet with long-term capital to take advantage of investment opportunities and endure potential future financial turmoil |
| • | Preserve and grow net operating income in the operating and development portfolios |
| – | Harvest embedded growth through increased occupancy to 95% |
| • | Opportunistically invest in compelling opportunities |
[Slide 4, page 28 of the “REG Investor and Analyst Day Presentation”]
Key Initiatives and Action
| • | Aggressively lease vacant space |
| – | Focus on better operators |
| – | Terms: modest TIs, no free rent, and shorter terms when appropriate |
| – | Target tenants in weaker centers to “upgrade” to a Regency center |
| • | Continue to enhance and implement PCI program |
| – | Differentiate through expertise at leasing side shop space |
| • | Proactively renew high percentage of existing tenants |
| • | Cost-effectively further differentiate appearance of centers |
| • | Identify compelling investment opportunities |
| – | Convert land held to developments or sales |
| – | Internal and external redevelopments |
| – | New developments with excellent visibility to 95% occupancy |
| – | Core acquisitions at reasonable price |
[Slide 5, page 29 of the “REG Investor and Analyst Day Presentation”]
Key Initiatives and Action
| • | Proactively and efficiently refinance maturing corporate debt and mortgage debt term maturities in co-investment partnerships |
| • | Work closely with banking group for early extension of bank facilities |
| • | Diligently monitor sources, uses and commitments of capital to ensure availability of bank line capacity and cash to comfortably fund financial commitments and investment opportunities and withstand and profit from future crises |
| • | Maintain high level of employee engagement |
[Slide 6, pages 31 through 35 of the “REG Investor and Analyst Day Presentation”]
2010 Earnings Guidance
| 2009E | 2010E | |||
| Recurring FFO/Share |
$2.59 - $2.64 | $2.11 - $2.31 | ||
| FFO/Share |
$1.02 - $1.07 | $2.12 - $2.34 | ||
| Percent leased at period end |
91.5% - 93.0% | 90.0% - 92.5% | ||
| Same store NOI growth |
(7.8)% - (6.8)% | (4.0)% - (1.0)% | ||
| Rental rate growth |
(4.0)% - (2.0)% | (8.0)% - (2.0)% | ||
| Acquisitions - consolidated |
$0 | $50,000 - $100,000 | ||
| JV Acquisitions - 3rd Party (gross $) |
$17,884 | $50,000 - $100,000 | ||
| JV Acquisitions - REG contributions (gross $) |
$133,900 | $0 | ||
| Dispositions - operating properties (REG pro rata) |
$136,145 | $25,000 - $75,000 | ||
| Development starts |
$13,970 - $30,500 | $0 - $50,000 | ||
| Development stabilizations - net costs |
$95,451 - $111,000 | $200,000 - $306,000 | ||
| Development NOI |
$30,000 | $32,100 - $34,100 | ||
| NOI yield on stabilizations (net development costs) |
7.8% - 7.9% | 8.0% - 8.4% | ||
| Capitalized interest on stabilizations |
$1,585 | $0 - $500 | ||
| Net interest expense |
$111,500 | $120,000 - $121,000 | ||
| Capitalized interest |
$19,000 | $6,000 - $7,000 | ||
| Recurring net G&A |
$46,000 | $53,000 - $56,000 | ||
| Recurring 3rd party fees and commissions |
$27,500 - $29,500 | $24,000 - $26,000 | ||
| Transaction profits net of taxes, acquisition costs and dead deal costs |
$20,000 - $21,000 | $1,000 - $2,500 |
| *$000s | except per share numbers |
[Slide 7, page 36 of the “REG Investor and Analyst Day Presentation”]
2010 Guidance Reconciliation
| 2009 Recurring Range |
$ | 2.59 | $ | 2.64 | ||||
| NOI* | ||||||||
| Same store NOI |
(0.18 | ) | (0.05 | ) | ||||
| Non same store NOI |
(0.01 | ) | (0.01 | ) | ||||
| 2009 Acquisitions |
0.01 | 0.01 | ||||||
| 2009 Dispositions |
(0.11 | ) | (0.11 | ) | ||||
| Development NOI |
0.03 | 0.05 | ||||||
| MCW II option exercise |
0.15 | 0.16 | ||||||
| NOI subtotal* |
(0.11 | ) | 0.05 | |||||
| Recurring net G&A |
(0.09 | ) | (0.13 | ) | ||||
| Change in interest expense |
(0.12 | ) | (0.11 | ) | ||||
| Recurring fees |
(0.06 | ) | (0.03 | ) | ||||
| Before weighted average shares |
$ | 2.21 | $ | 2.42 | ||||
| Impact from change in weighted average shares |
(0.10 | ) | (0.11 | ) | ||||
| 2010 Recurring FFO |
$ | 2.11 | $ | 2.31 | ||||
*Wholly owned and Regency’s pro rata share of co-investment partnerships
Exhibit 99.3
Reconciliation of FFO and Recurring FFO Guidance to Net Income
December 31, 2009 and 2010
All numbers are per share except weighted average shares
| Funds From Operations Guidance: | Full Year 2009 | Full Year 2010 | ||||||||||||||
| Net income attributable to common stockholders |
($ | 0.69 | ) | ($ | 0.64 | ) | $ | 0.12 | $ | 0.34 | ||||||
| Adjustments to reconcile net income to FFO: |
||||||||||||||||
| Depreciation expense and amortization |
1.94 | 1.94 | 2.00 | 2.00 | ||||||||||||
| Loss (gain) on sale of operating properties |
(0.22 | ) | (0.22 | ) | — | — | ||||||||||
| Funds From Operations |
$ | 1.02 | 1.07 | $ | 2.12 | 2.34 | ||||||||||
| Adjustments to reconcile FFO to Recurring FFO: |
||||||||||||||||
| All non-recurring items as defined below |
1.57 | 1.57 | (0.00 | ) | (0.02 | ) | ||||||||||
| Recurring Funds From Operations |
$ | 2.59 | 2.64 | $ | 2.11 | 2.31 | ||||||||||
| Weighted average shares (000’s) |
77,192 | 81,086 | ||||||||||||||
Regency considers FFO to be an accurate benchmark to its peer group and a meaningful performance measurement for the company because it excludes various items in net income that do not relate to or are not indicative of the operating performance of the ownership, management and development of real estate. FFO is defined by the National Association of Real Estate Investment Trusts generally as net income attributable to common stockholders (computed in accordance with GAAP), (1) excluding real estate depreciation and amortization and gains and losses from sales of operating properties (excluding gains and losses from the sale of development properties or land), (2) after adjustment for unconsolidated partnerships and joint ventures computed on the same basis as item 1 and (3) excluding items classified by GAAP as extraordinary.
Regency also provides “Recurring FFO” for the purpose of excluding those items considered non-recurring that are included within FFO. Non-recurring income would include transaction profits, net, which is comprised of development and outparcel gains, and non-recurring transaction fees such as promote income, net of dead deal costs and applicable income taxes. Non-recurring expenses would include provisions for impairment, restructuring charges, losses on early debt stock extinguishments, and other significant one-time charges considered non-recurring.