67 WALL STREET, New York - October 25, 2013 - The Wall Street Transcript has just published its REITs Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Pricing Power Outlook - Acquisition and Financing Costs - Apartment, Lodging, Self-Storage and Office REITs - Consolidation Activity - REIT Access to Capital
Companies include: Pennsylvania Real Estate Investment Trust (PEI) and many more.
In the following excerpt from the REITs Report, the CEO of Pennsylvania Real Estate Investment Trust (PEI) discusses company strategy and the outlook for this vital industry:
TWST: Earlier you mentioned having a better balance sheet than in the past eight to 10 years. What steps in particular did the company take to accomplish that? Would you tell us a bit about more your financing strategy going forward?
Mr. Coradino: We did a couple of things right. At the same time we wanted to improve our balance sheet, we also wanted to improve the quality of our portfolio, and so we set about a strategy of disposing of two types of noncore assets - one, which were lower-quality properties, and two, power centers that were not part of our core business, that were essentially quality properties but open-air power centers.
The first part, which is disposing off the lower-quality assets, obviously improved our portfolio metrics from sales and occupancy perspectives. The second part, which was selling off the power centers, we used to pay down debt. We employed a strategy of selling those noncore power centers off, paying down debt, which got us to the point where we started to see some growth in our stock price and our multiple, which then allowed us to go the equity market, and we raised about $230 million in equity.
So between the sale of some of our assets and our equity raise, we now have improved our leverage to the point where we are, again, below 50%, actually 48% and change for the first time since 2005. And by the way, while we're proud of what we've accomplished, we're not completely satisfied. We'd like to think that we can maintain a leverage ratio of potentially in the low to mid-40s, so more work to do before we rest.
TWST: How are occupancies and sales and rents trending in your portfolio?
For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.