Capital Properties posts 3Q loss as petroleum storage revenue drops
CAPITAL PROPERTIES â€“ owner of much of Providence's Capital Center real estate, including the land that the Capitol Cove apartments are built on â€“ recorded a net loss in the third quarter, thanks to its underperforming petroleum storage facility in East Providence.
EAST PROVIDENCE â€“ Capital Properties Inc., thanks to the continuing underperformance of its petroleum storage facility, posted a net loss of $65,000, or 1 cent per share, in its third quarter, a reversal of a $514,000, or 7 cent-per-share, profit a year earlier.
Through the end of September, the real estate owner saw net income of $526,000, or 8 cents per share, compared with earnings of $1.6 million, or 24 cents per share in the first nine months of 2012.
Capital Properties owns a substantial portion of the Capital Center area of Providence and derives leasing income from tenants that have built commercial and residential buildings on the land, including the headquarters of Blue Cross & Blue Shield of Rhode Island, the Waterplace condominiums and the Capitol Cove apartments â€“ which have been leased by Johnson & Wales University to be used as a dormitory â€“ among other properties.
Revenue from that portion of its holdings (which also includes unimproved lots in the city, land leased by Lamar Outdoor Advertising LLC for billboards and a multi-tenant building on Steeple Street in Providence) increased in the third quarter to $1.11 million from $1.05 million in the third quarter of 2012.
The other half of the companyâ€™s business comprises a petroleum storage facility in East Providence as well as an offloading pier in Narragansett Bay. From May 1998 through April 2013, Capital Properties operated the facility on behalf of Global Companies LLC, but the agreement came to an end at the end of April, leaving the 1.04 million shell barrels of capacity empty.
Beginning Sept. 1, the company entered into an eight-month agreement with Atlantic Trading & Marketing Inc. to use roughly 44 percent of the storage capacity, although Capital Properties continues to market the remaining capacity as well as look at other options. Revenue from petroleum storage totaled $163,000 in the third quarter, down from $996,000 in the third quarter of 2012.