Maguire Properties (MPG) (MPG)

[startingboy]

All of the company's debt is non-recourse, attached only to a
particular building. Therefore, problems with any particular
asset cannot infect other assets or the company as a whole. If
issues exist with one asset, the company is free to
renegotiate, or just walk away. Neither is the company
burdened by debt covenants that could cause difficulties in
this troublesome market.

-- When the company concludes its Orange County strategy, it
would have a portfolio of 13.7 million sq. ft., (87% leased)
of which 10.3 million sq. ft. is located in Los Angeles County
(which is 90% leased). The Los Angeles County properties are
trophy quality with predominantly strong credit tenants and I
believe have very little exposure to the Wall Street fall-out.
The remaining Orange County properties are first-rate as well.

-- The company will have irreplaceable long term debt of $4
billion (5.45% interest only 7 year average maturity, $218
million annual cost). Net operating income should be around
$275 million in 2008 which could and should grow to over $395
million by 2011. That should produce cash flow after $218
million debt service of $77 million in 2008, growing to over
$175 million by 2011, providing adequate margin to pay
preferred dividends, and G&A. If this is achieved, the company
could resume a common dividend no later than 2011.


smart post from another board :)!