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September 8, 2011

Forest City Enterprises reports big drop in quarterly profits, mainly because last year they could sell Nets share; "forecasted contractually obligated revenues for the arena" have risen only from 51% to 56% in one year

Atlantic Yards Report

Forest City Enterprises's FY 2011 second-quarter and year-to-date results, as noted a press release yesterday, show earnings down, mainly because the company--parent to Forest City Ratner--didn't have shares in a losing Nets team to sell this year.

Also, as noted below, the public statement contained an indication that sponsorship sales for the Barclays Center arena could be more robust.

Earnings down

For this quarter, net earnings declined from $.62/share to $.02/share over last year, a phenomenon that was emphasized by the AP and Cleveland Plain Dealer in their stories.
...

Arena forecast revenues up only slightly

From the release:

Work continues at Barclays Center at Atlantic Yards, and an official opening date of September 28, 2012 has been set for the arena. Approximately 56 percent of forecasted contractually obligated revenues for the arena are currently under contract.

They haven't made much progress in the past year. Three months ago, the figure was 55%. Six months ago, the figure was 55%. In September 2010, one year ago, the figure was 51%.

At the past year's pace, they won't be that much past 60% in September 2012 when the arena opens. I wouldn't doubt they're working on some deals and that they want a much higher number.

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Forest City Enterprises Press Release

Posted by eric at September 8, 2011 11:04 AM