(RTTNews) - Monday, Associated Estates Realty Corp. (AEC: News ), a self-administered and self-managed equity real estate investment trust, reported a decline in third quarter funds from operations as revenue declined 3.5 percent. The company also lowered the upper end of its full year guidance range.

Funds from operations or FFO for the quarter declined to $4.26 million from $5.05 million in the corresponding period last year. FFO per share decreased to $0.26 from $0.31 per share a year-earlier. Two analysts polled by Thomson Reuters expected the company to earn $0.25 per share for the quarter. Analysts' estimates typically exclude special items.

Net loss applicable to common shares was $3.9 million or $0.23 per share compared to $4.2 million or $0.26 per share in the same period last year.

Net operating income for the company's Same Community portfolio decreased 2.2% due to a 2.5% decrease in revenue and a 2.9% decline in property operating expenses, compared to the same period last year.

Physical occupancy at the end of the quarter was 94.6% compared to 95.8% at the end of the third quarter of 2008. Average net rent per unit for the quarter for the Same Community portfolio was $917 per month, down 1.1% compared to the third quarter of 2008. Net rent per unit for the quarter for the company's Same Community Midwest portfolio remained flat compared to the same period last year, at $828.

Total quarterly revenue declined 3.5% to $32.9 million from $34.1 million a year earlier. Two analysts expected the company to report revenue of $31.93 million for the quarter.
For the nine month period, FFO was $15.6 million or $0.94 per share and includes a credit to expenses of $563 thousands or approximately $0.03 per share for a refund of defeasance costs on certain previously defeased loans.

For the nine month period, net income applicable to common shares was $5.4 million or $0.33 per share compared to $31.1 million or $1.92 per share in the same period last year. Total revenue increased slightly to $98 million from $97.7 million in the year-ago period.

Looking ahead, Associated Estates lowered upper end of its full year FFO adjusted guidance range to $1.17 to $1.20 per share from its previous guidance range of $1.17 to $1.23 per share. The company also announced that it does not intend to acquire any properties for the remainder of the year.

AEC rose $0.08 or 0.83% and closed Monday's regular trading at $9.76.

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by RTT Staff Writer

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