COPT reports 2nd-quarter losses, writes off $70M

Corporate Office Properties Trust took a hit in the three-month period that ended in June, as it wrote off nearly $70 million related to properties the real estate investment trust has decided to sell or not redevelop. The Columbia-based firm, which develops and owns office buildings with primarily defense-related tenants, said Thursday it lost 54 cents per share in the second quarter, compared to profits of 13 cents per share during the same period last year. The firm’s funds from operations, a measure typically used to measure REITs, declined to 36 cents per share from 48 cents a year earlier. Despite the loss, CEOStephen E. Budorick said the firm remains on track to achieve its goals, pointing to solid leasing and sales, including six data centers purchased by an affiliate it formed with investment firm GI Partners. COPT expects sales worth $235 million before the end of September, Budorick said. COPT reported revenue of about $146 million for the second quarter, down from $170 million a year ago, reflecting a decline in construction revenue. Operating expenses surged to nearly $173 million, driven by impairment losses of about $69.6 million, traced to a decision to sell additional properties, including in the Aberdeen, Fort Meade and BaltimoreWashington markets. the agency says the firm owes employees’ retirement accounts. The firm failed to deposit that amount of withheld employee contributions into the company’s 401(k) plan from July 28, 2010, through July1, 2012, according to a suit filed Tuesday in U.S. District Court in Baltimore. The plan had 20 participants and assets of $2.28 million as of Dec. 31, 2014, the lawsuit says. It alleges the company violated the federal Employee Retirement Income Security Act. The lawsuit, which also names Donald Kann, the firm’s president, values of the opportunity cost of the missing and late employee contributions at more than $34,000. Neither Kann nor representatives for the firm could not be reached Thursday. The firm is known for projects such as the Bagby Building redevelopment in Harbor East and the Hotel Indigo in Mount Vernon. The agency is asking the court to require the company to restore all losses and remove the company and Kann as fiduciaries of the plan and any other employee benefit plans.