FARMINGTON HILLS, Mich., Oct. 27, 2011 /PRNewswire/ --

Third Quarter 2011 Highlights:

• Excluding the negative impact of $.55 per share of net non-cash impairment charges and other items related to the Borders bankruptcy, Funds from Operations per share, as adjusted, was $0.55 for the third quarter
• Acquired four single tenant retail properties for combined cost of $15.6 million
• Revenues up 7.3% compared to the third quarter of 2010
• $0.40 per share dividend for the third quarter paid October 11, 2011
• Closed on new $85,000,000 unsecured revolving credit facility on October 26, 2011

Agree Realty Corporation (NYSE: ADC) today announced results for the quarter ended September 30, 2011. Third quarter FFO was $41,000 compared with FFO in the third quarter of 2010 of $6,020,000.  The reduction in third quarter FFO and FFO per share is the result of the net impact of several non-cash impairment charges and other items amounting to $(5,440,000) related to the Borders Group bankruptcy discussed below.  FFO per diluted share for the third quarter of 2011 was $0.00 compared with $0.60 for the third quarter of 2010.  Excluding the non-cash items related to Borders, FFO per share, as adjusted, for the three months ended September 30, 2011 was $.55 per share.  

"In connection with the preparation of our quarterly financial statements and in light of developments in the Borders bankruptcy, we have determined that non-cash impairment charges were necessary related to certain of the assets formerly occupied by Borders based on anticipated dispositions.  In addition, we recognized non-cash deferred revenue due to one of the Borders store closures and rejection of the related lease.  Lastly, through the non-cash extinguishment of debt we gained full control of one of the properties formerly leased to Borders in Lawrence, Kansas, which was formerly encumbered by a mortgage," said Joey Agree, President and Chief Operating Officer.  "The Company does not anticipate any further impairments related to the former Borders properties, assuming no change in the terms of our expected property dispositions.  Additionally, the Company does not anticipate any reduction in the Company's dividend rate due to the disposition of the former Borders properties or the Borders bankruptcy.  We continue to market our remaining Borders assets for both sale and lease."

A reconciliation of net income to FFO and FFO, as adjusted, is included in the financial tables accompanying this press release.  Net loss for the third quarter of 2011 was $(1,794,000), or $(0.19) per diluted share, compared with net income for the third quarter of 2010 of $4,541,000, or $0.46 per share.  Total revenues, excluding the impact related to Borders, increased 7.3% to $9,450,000, compared with total revenues of $8,810,000 in the third quarter of 2010.

For the nine months ended September 30, 2011, FFO was $11,790,000 compared with FFO for the nine months ended September 30, 2010 of $17,975,000.  FFO per diluted share was $1.18 compared with $1.92 for the nine months ended September 30, 2010.  FFO per share decreased due to an increase in the weighted average shares outstanding as a result of the common share offering in April 2010.  In addition, FFO and FFO per share decreased due to the net impact of several non-cash items amounting to $(5,440,000) related to the Borders Group bankruptcy discussed elsewhere in this press release.  Excluding the non-cash items related to the Borders Group bankruptcy, FFO per share, as adjusted, for the nine months ended September 30, 2011 was $1.72 per share. Net income was $6,668,000, or $0.67 per diluted share, compared with net income for the comparable period last year of $18,941,000, or $2.02 per diluted share.  Net income for the nine months of 2010, included a gain of $5,328,000, or $0.59 per share from the sale of the Company's Santa Barbara, California, Borders Books store.  Total revenues, excluding the impact related to the Borders Group bankruptcy, increased 10.4% to $29,302,000 compared with total revenues of $26,546,000 for the comparable period last year.  

New Credit Facility

As announced previously, the Company closed on a new $85 million unsecured revolving credit facility on October 26, 2011.  The new credit facility contains an accordion feature that would allow the Company to expand the credit facility to $135 million, subject to satisfaction of conditions.  The facility is for three years, maturing October 2014, and can be extended for two-one year periods to October 2016 at the Company's option.  Borrowings are priced at LIBOR plus a margin of 175 to 260 basis points.

"We are pleased to complete the closing of our new credit facility.  We also acquired four net leased assets during the quarter.  The acquisitions include properties net-leased to CVS, NTB, Big O Tires and Aldi.  Our development and acquisition pipelines continue to grow and produce high-quality net lease opportunities for industry leading tenants," Joey Agree added.

Borders Bankruptcy Status

Borders Group, Inc. and certain of its subsidiaries, including Borders, Inc., has been operating in a Chapter 11 bankruptcy since February 16, 2011.  In July 2011, Borders, unable to conclude a sale as a going concern, received the bankruptcy court's approval for the liquidation of all of the assets of Borders, including its leases.  Borders closed the six remaining retail stores owned by the Company during September 2011.  The Company has one location currently leased by Borders, the Borders corporate headquarters in Ann Arbor, Michigan.  

During the quarter ended September 30, 2011, the Company recognized various non-cash items amounting to net charges of $(5,440,000).  These included non-cash impairment charges of $13,500,000 related to Borders properties, offset by non-cash deferred revenue recognition of $5,700,000 which is included in minimum rents and a non-cash gain on extinguishment of debt of $2,360,000.  The Company continues to market all of the former Borders locations for potential retenanting or disposition.

Dividend

The Company paid a cash dividend of $0.40 per share on October 11, 2011 to shareholders of record on September 30, 2011.  The dividend is equivalent to an annualized dividend of $1.60 per share.

Portfolio

At September 30, 2011, the Company's total assets were $282,023,000 and its portfolio consisted of 85 properties located in 20 states and totaling 3,848,943 square feet of gross leasable space.  The portfolio was 91.1% leased at the end of the quarter.  

The Company's construction in progress balance totaled approximately $421,000 at September 30, 2011.

Major Tenants

The following is a breakdown of base rents in effect at September 30, 2011 for each of the Company's major tenants:

Lease Expirations

The following table, as of September 30, 2011, sets forth lease expirations for the next 10 years for the Company's freestanding properties and community shopping centers, assuming that none of the tenants exercise renewal options or terminate their leases prior to the contractual expiration date.

Annualized Base Rent of Properties

The following is a breakdown of base rents in effect at September 30, 2011 for each type of retail tenant:

Outstanding Shares and Operating Partnership Units

For the three and nine months ended September 30, 2011, the Company's fully diluted weighted average shares outstanding were 9,666,791 and 9,669,349.  The basic weighted average shares outstanding for the three and nine months ended September 30, 2011 were 9,635,835 and 9,632,744.

The Company's assets are held by, and all of its operations are conducted through, Agree Limited Partnership, of which the Company is the sole general partner.  As of September 30, 2011, there were 347,619 operating partnership units outstanding and the Company held a 96.59% interest.

Acquisition Activity

The Company acquired four retail properties during the third quarter for a total of $15,600,000.  The four properties are single tenant buildings net leased to NTB, CVS, Aldi, and Big O Tires.

About Agree Realty Corporation

Agree Realty Corporation is engaged in the ownership, management and development of properties, which are primarily single tenant properties leased to retail tenants and neighborhood community shopping centers.  The Company currently owns and operates a portfolio of 86 properties, located in 21 states and containing approximately 3.9 million square feet of gross leasable space.  The common stock of Agree Realty Corporation is listed on the New York Stock Exchange under the symbol "ADC."

Forward-Looking Statements

The Company considers portions of the information contained in this release to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended.  These forward-looking statements represent the Company's expectations, plans and beliefs concerning future events.  Although these forward-looking statements are based on good faith beliefs, reasonable assumptions and the Company's best judgment reflecting current information, certain factors could cause actual results to differ materially from such forward–looking statements.  Such factors are detailed from time to time in reports filed or furnished by the Company with the Securities and Exchange Commission, including the Company's Form 10-K for the year ended December 31, 2010.  Except as required by law, the Company assumes no obligation to update these forward–looking statements, even if new information becomes available in the future.

For additional information, visit the Company's home page on the Internet at http://www.agreerealty.com

Agree Realty Corporation Operating Results (in thousands, except per share amounts) (Unaudited)
	Three Months Ended September 30,		Nine Months  Ended September 30,
	2011	2010	2011	2010
Revenues:
Minimum rents (1)	$14,270	$8,137	$31,620	$23,979
Percentage rent	-	8	22	21
Operating cost reimbursements	849	590	2,350	1,900
Development fee income	-	47	895	583
Other income	28	28	112	63
Total Revenues	15,147	8,810	34,999	26,546
Operating Expenses:
Real estate taxes	870	455	2,276	1,452
Property operating expenses	378	397	1,187	1,123
Land lease payments	255	97	737	290
General and administration	1,093	1,151	4,056	3,604
Depreciation and amortization	1,909	1,437	5,158	4,176
Impairment charge	13,500	retail properties, tenant retail properties, retail stores, retail tenant, ann arbor, farmington hills, santa barbara, lawrence, borders inc., agree limited partnership, new york stock exchange, cvs, kmart, bankruptcy status borders group inc., borders group, agree realty corporation, millionrevenues, 2011agree realty corporation, kansas, california, michigan, usd, joey agree, securities and exchange commission, borders books store, finance, corporate finance, financial economics, income, united states law, dividend, mergers and acquisitions, cash flow, comprehensive income, agree realty corp, cvs caremark corporation, sears holdings corporation, major, president and chief operating officer, forward, nyse euronext Read source article Blog on news item Related content News: Retail Vacancy Rate In Northern NJ Rises To 8.2% As More 'Big Box' Spaces Go Empty, R.J. Brunelli Survey Reports 346 days ago - PR Newswire: Banking & Financial Services OLD BRIDGE, N.J., June 13, 2012 /PRNewswire/ -- With new big-box store closures negating the benefits of absorptions, the vacancy rate in retail properties along northern New ... News: Agree Realty Corporation Reports Operating Results for the Fourth Quarter and Full Year 2011 451 days ago - PR Newswire: Banking & Financial Services FARMINGTON HILLS, Mich., Feb. 29, 2012 /PRNewswire/ -- Full Year 2011 Highlights: Acquired ten single tenant retail properties for combined cost of approximately $38.8 millio... The Financial Services Club Profile Connections Connected to Blog Media Pages Bookmarks Products Blog: Banks designed for humans, not money The Financial Services Club 9 days ago News: Weekly Announcements – December 19, 2012 157 days ago - The SSRN Blog Here are the latest announcements from SSRN: Bielefeld University Joins Economics Departments Research Papers We are pleased to announce Bielefeld University ... News: Agree Realty Announces Two Acquisitions 334 days ago - PR Newswire: Banking & Financial Services FARMINGTON HILLS, Mich., June 25, 2012 /PRNewswire/ -- Agree Realty Corporation (NYSE: ADC) today announced that it has acquired a newly constructed store leased to Dolla... News: SG Private Wealth Advisors completes a 40mm USD aircraft transaction while eliminating the need of an aircraft broker 347 days ago - PR Newswire: Banking & Financial Services SANTA BARBARA, Calif., June 12, 2012 /PRNewswire/ -- Aligned with the expansion of its Aircraft Advisory services, SG Private Wealth Advisors announced the successful pur... © MoneyScience 2011-2012 All Rights Reserved. VAT No: 902 7652 32 Company No. 6184038 Help | Contact | Disclaimer Terms & Conditions | Privacy Policy Advertising | Feeds