Money Talk: Little Rock REIT ekes out $6.8 million 4Q profit, closes on first acquisition in April

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LITTLE ROCK REIT EKES OUT $6.8 MILLION 4Q PROFIT, PLANS TO CLOSE ON FIRST ACQUISITION IN APRIL
Little Rock real estate investment trust (REIT) Communications Sales & Leasing on Thursday (March 3) reported fourth quarter earnings of five cents per share, or $6.8 million on revenue of $173.9 million. For the period ended Dec. 31, CS&L reported funds from operations (FFO) of $92.8 million, or 62 cents per share. Funds from operations is a closely watched measure in the REIT industry. It takes net income and adds back items such as depreciation and amortization.

CS&L was spun-off from Windstream Holdings on April 24, 2015. As such, there were no prior year comparisons for Arkansas’ newest publicly-traded concern. The Arkansas REIT said it plans to close in on its previously announced acquisition of PEG Bandwidth LLC in April. PEG, based in Lewisville, Texas, is a provider of fiber and cell site backhaul assets for mostly rural telecom carriers and enterprises.

4Q EXECUTIVE SURVEY SHOWS WANING OPTIMISM IN U.S. ECONOMY
Business executives’ optimism about the U.S. economy has fallen to its lowest level in more than three years, according to the first quarter AICPA Economic Outlook Survey, which polls chief financial officers, controllers and other certified public accountants in U.S. companies who hold executive and senior management accounting roles.

Some 28% of survey respondents identified themselves as “optimistic” or “very optimistic” about prospects for the U.S. economy over the next 12 months, down 17 percentage points from last quarter and 40 percentage points from a year ago. In comparison, 34% said they were “pessimistic” or “very pessimistic,” the highest ratio since the end of 2012. The rest were neutral. Concerns about both the U.S. and global economy have led to sharply lower expectations for key performance indicators, the survey found. For full survey results, click here.

FEDERAL BANKING AGENCIES CLARIFY RULES ON PROPERTY EVALUATIONS BY U.S. BANKS
The federal banking regulatory agencies issued an advisory on Friday (March 4) to clarify expectations for the use of property evaluations by banking institutions. The advisory responds to questions raised during outreach meetings held by the agencies last year pursuant to the Economic Growth and Regulatory Paperwork Reduction Act. The advisory describes the agencies’ existing supervisory expectations for the use of an evaluation instead of an appraisal to estimate a property’s market value for certain real estate-related financial transactions. Unlike an appraisal, an evaluation does not have to be developed by a state-licensed or state-certified appraiser.

The advisory also addresses the use of alternative valuation approaches, methods, and other information that financial institutions may use to develop an evaluation in areas with few, if any, recent comparable property sales in reasonable proximity to the subject property.