Mills' Earnings Take Hit

ARLINGTON, VA-The Mills Corp.’s earnings and FFO were both down during its Q3, which ended Sept. 30, due to various one-time charges as well as a decrease in straight-line rents. The REIT’s third-quarter NOI fell 5.2%, to $104.7 million, from the same year-ago period, while FFO dropped 53.6%, to 45 cents per share.

Some of the one-time charges are related to the modification of five skate park leases at some of its centers due to an ownership change as well “as an increase in bad debt reserves due to changes in the estimated collectability of certain accounts receivable,” says the company’s quarterly SEC filing. Meanwhile, straight-line rents fell by $2.4 million compared to last year’s third quarter.

Other charges related to write offs due to two projects the company was pursuing that executives decided to abandon, in Tampa, FL, and Florence, Italy. “It was hard to find the appropriate site there,” said Laurence C. Siegel, chairman and CEO of the company, of the Tampa project. “It become cost prohibitive.” In Florence Mills could not obtain the desired layout for a center.”