Shares of Essex Property Trust plummets

The difficult period thanks to ongoing global recession is almost throttling the national economies and the U. S. economy in spite of its affluence and strength happens to be one of them. The whole economy is in a bad shape and almost all the leading sectors of the country are facing the brunt. The property sector is witnessing the worst period in the last few decades and the key players in the industry are facing the bottom as a result. Essex Property Trust, the well-known real estate investment trust, happens to be one of them and it felt a declination in the recent days when its shares closed down more than 9 percent. It is to be noted that the company reported lower-than-expected guidance for 2009.

It has been learnt that the shares plummeted as low as $54.78 after the real estate investment trust calculated approximately that its full-year funds from operations, or FFO, will range between $5.50 to $5.90 a share. This happens to be well below analysts’ average forecast of $5.89 per share. What is FFO? FFO is reputed for adding items like amortization and depreciation to net income and is known as a key measure of REIT strength. Essex said it based its 2009 guidance on the assumption that the U.S. economy will continue to slow, resulting in a decline in gross domestic product of 1.3 percent and the loss of 2 million payroll jobs.

Essex Property Trust, Inc., is a fully integrated real estate investment trust (REIT) that acquires, develops, redevelops, and manages multifamily residential properties in selected West Coast communities. The Company currently has ownership interests in 133 multifamily properties (26,790 apartment homes), and has 1,658 units in various stages of development. The properties are located in the San Francisco Bay Area, Southern California, and the Pacific Northwest. Since the Company was founded in 1971, it has become the only multifamily REIT with a diversified portfolio located in strong West Coast markets which have significant constraints on the production of housing.