Santa Ana-based real estate brokerage and investor Grubb & Ellis Co. reported a smaller third-quarter loss last week as the company cut costs and saw fewer write-downs in the value of real estate.
Grubb reported a net loss of $21.4 million, versus a loss of $56.3 million a year earlier.
There was no consensus estimate from Wall Street analysts.
Grubb saw a big drop in administrative expenses, which fell 36% from a year earlier to $25.5 million.
Write-downs on real estate to reflect lower values went from $35 million a year ago to $2.4 million.
Revenue fell 11% to $136.1 million.
Real estate brokerage and consulting revenue was down 19% to $46.3 million but rose 6% from the second quarter.
“We saw an increase in transaction volume over the second quarter, an indication that the investments we have made to attract top-tier talent are paying off,” said Richard W. Pehlke, executive vice president and chief financial officer. “The market—albeit still difficult—showed signs of improvement versus the first half of the year.”
Grubb is working through the worst real estate downturn in recent memory.
In October, the company reached a $90 million deal with institutional investors that led it to pay off a potentially crippling debt earlier this month.
The preferred stock deal allowed Grubb to pay off two credit lines that were due to be paid by the end of this month.
Grubb is selling 900,000 shares of 12% convertible preferred stock to the institutional investors.
The company hasn’t named the investors. One is believed to be Fidelity Investments parent FMR LLC of Boston.
Earlier this month, Grubb said it hired Thomas P. D’Arcy as chief executive.
D’Arcy, 49, currently is chairman of Inland Real Estate Corp., a $1.5 billion real estate investment trust where he has served as an independent director since 2005.
Prior to joining Grubb, he also was a principal in Bayside Realty Partners, a privately held investment and development company.
D’Arcy’s appointment concludes a lengthy search by Grubb to find a full-time chief.
Gary Hunt, a former executive at Newport Beach’s Irvine Co., had been leading the company on an interim basis since July 2008.
—Michael Lyster
