Developers Diversified: Ahead Of Plan With Asset Sales, Debt

   DOW JONES NEWSWIRES 
 

Developers Diversified Realty Corp. (DDR) said it's ahead of schedule with boosting liquidity and cutting debt as the shopping-center developer.

The debt-laden real-estate investment trust has been moving to reduce its borrowings amid credit-market constraints that have resulted in difficulties for companies refinancing debt.

When it reported third-quarter results in October, the owner or manager of 730 retail properties outlined plans to sell stakes in several properties to institutional investors to pay down debt. But a plan to sell $890 million of properties to a joint venture has been in doubt.

DDR got religion after Chief Executive Scott Wolstein fell victim to his own cash squeeze in which he had to sell nearly half his stake in the company to satisfy margin calls.

DDR noted Monday that paid off senior notes that matured on Jan. 31, with the next unsecured debt not maturing until May 2010. The company added it has more than $100 million of assets under contract or subject to letter of intent for sale.

Meanwhile, DDR sold five former Mervyns locations in California and Nevada to Kohl's Corp. (KSS). Mervyns went out of business after filing for bankruptcy protection last year.

DDR shares rose 1.7% premarket to $4.88. The stock has lost some 85% of its value the past five months.

-By Kevin Kingsbury, Dow Jones Newswires; 201-938-2136; [e-mail]