MPG Office Trust posts $39.5-million loss
Long-suffering office landlord MPG Office Trust Inc. reported a first-quarter loss Monday as the Los Angeles company struggled with debt and a weak rental market.
The real estate investment trust, which owns some of the region’s best-known skyscrapers including the U.S. Bank Tower in downtown Los Angeles, finished the quarter ended March 31 with a loss of $39.5 million, or 81 cents a share.
MPG turned a profit of $18.6 million, or 38 cents, in the same period a year earlier. That quarter in 2010 was influenced by significant one-time events including forgiveness of a $49.1-million debt on a Santa Ana office building the company sold.
“MPG is surviving but far from thriving,” said analyst Michael Knott of Green Street Advisors. “Cash flow is still ugly, and MPG needs a magic wand to create more tenant demand and higher rents in the market, but it’s just not happening quickly.”
MPG’s buildings were 81% occupied in the first quarter of 2011. Revenue fell 7% from a year earlier to $95.9 million.
“The company continues to shrink,” said analyst Craig Silvers, president of Bricks & Mortar Capital. “They’re trying to keep it afloat long enough for the economy to turn and for them to lease up space and show a profit.”
Shares of MPG closed up 6 cents at $3.19 before the company’s quarterly results were announced.
