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CBL Properties on Thursday reported that funds from operations, as adjusted, fell in the third quarter versus a year ago even as the shopping center developer says it made significant progress on its anchor redevelopment program.

Adjusted FFO came in at 34 cents per diluted share in the quarter, down from 40 cents a year ago, according to the Chattanooga-based owner and operator of Hamilton Place and Northgate malls in the city. Still, the results were 2 cents above analyst expectations.

FFO per share in the quarter was impacted by 2 cents per share of dilution from asset sales completed since the prior-year period and 4 cents per share of lower property net operating income, according to the company that released results after the close of the stock markets.

"Third quarter results demonstrated the resiliency of our portfolio of market-dominant properties," said Stephen D. Lebovitz, CBL's chief executive officer, in a statement.

He said the company is "on track to achieve full-year results within the mid-to-high end of our reaffirmed guidance range.

"Operational results were also in line with improved sales and spreads on new leasing, and our reserve was able to offset additional retailer bankruptcies, store closings and restructurings," Lebovitz said.

Same-center sales per square foot for the stabilized mall portfolio for the third quarter improved 3.2%. For the 12-months ended Sept. 30, same-center sales increased 1.1% to $383 per square foot compared with the prior-year period, the company reported.

CBL said it made progress on its anchor redevelopment program, including 27 former anchor spaces committed, under construction or with replacements already open featuring dining, entertainment, fitness and other mixed-use components.

Lebovitz said that across CBL's portfolio, it's diversifying tenant mix in its shop leasing efforts, and it's pursuing opportunities to make more productive use of available land.

"Year-to-date, 74% of new mall leasing was executed with non-apparel tenants," he said. "We also recently commenced construction with joint venture partners on two new self-storage projects and a hotel and have several additional non-retail projects on the drawing board. These projects demonstrate the tangible progress and creativity that helps bring us closer to our goal of stabilizing revenues and returning to growth."

Ahead of the earnings announcement, CBL stock closed Thursday at $1.44 per share, down 8 cents, or 5.26% on the New York Stock Exchange.

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