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INDIANAPOLIS, IN -- (Marketwire) -- 01/30/13 -- Duke Realty Corporation (NYSE: DRE), a leading industrial, office and medical office property REIT, today reported results for the fourth quarter and full year 2012.

"We finished 2012 with an exceptional fourth quarter and continued to make substantial progress towards our asset, operating and capital strategic objectives," said Dennis D. Oklak, chairman and chief executive officer. "For the fourth quarter, we closed $448 million in acquisitions, started $147 million in new development, primarily in the industrial sector, paid off $61 million of debt and executed $26 million of dispositions. Operationally, we achieved Core FFO of $0.27 per share and grew our in-service portfolio occupancy to 93.0 percent, a 230 basis points improvement over the prior year end. For the full year, we executed over 29 million square feet of leases, a near-record year in leasing volume achieved by our company. Consistent with our asset strategy, we closed over $800 million of acquisitions and $153 million of dispositions. We also accelerated activity in our best in class development platform with $520 million in new starts."

"In early January, we took advantage of stable market conditions and executed a common equity offering to significantly advance our capital strategy. We raised $572 million in net proceeds, which was used to pay off our $285 million year-end line of credit balance and leaves us with additional capital to redeem our 8.375% Series O Preferred Shares in February 2013. The transaction was executed at an efficient all-in cost and reduces our leverage in alignment with our plans."

"Finally, we are introducing 2013 Core FFO guidance in the range of $1.03 to $1.11 per share, reflective of anticipated earnings growth from our asset re-positioning, continued positive operating fundamentals and an expected strong year in development starts."

Operating Highlights

Core funds from operations per diluted share ("Core FFO") was $0.27 for the quarter and $1.02 for the year. Funds from Operations per diluted share ("FFO") as defined by the National Association of Real Estate Investment Trusts ("NAREIT") was $0.25 for the quarter and $0.98 for the year. FFO, as defined by NAREIT, for the quarter included $1.6 million of acquisition-related costs and $2.7 million of overhead restructuring charges, neither of which are included in Core FFO. FFO, as defined by NAREIT, for the year included a $5.7 million adjustment related to the redemption of our Series M Preferred Shares, $4.2 million of net acquisition costs and $2.7 million of overhead restructuring charges, none of which are included in Core FFO.

•Strong operating momentum:

•In-service portfolio occupancy increased to 93.0 percent; •Tenant retention rate was 84.6 percent for the quarter and 83.1 percent for the year; •Over 29.2 million square feet of leases were completed for the year; •Same property net operating income growth was positive 1.6 percent for the quarter and 2.5 percent for the year.

•Significant asset strategy execution:

•Closed $448 million of bulk industrial and medical office building acquisitions for the quarter, including the assumption of $78 million of debt; and $800 million for the year; •Generated $26 million of proceeds from dispositions during the quarter, and over $153 million for the year; •Continued progress on our investment concentration objectives with our gross investment dollars portfolio mix at 51 percent industrial, 29 percent office, 16 percent medical office and 4 percent retail versus our strategic goal of 60 percent industrial, 25 percent office and 15 percent medical office; •On a net operating income basis, our portfolio mix comprised 54 percent industrial, 30 percent office, 13 percent medical office and 3 percent retail.

•Successful capital strategy achievement:

•Refinanced $600 million in unsecured debt at weighted average yield of 4.20 percent and redeemed the 6.95 percent Series M Preferred Shares totaling $168 million during the year; •Generated $315 million of net proceeds from an at-the-market (ATM) equity program during the year; •Post year end, issued 41.4 million shares of common equity raising net proceeds of $572 million to reduce leverage and improve coverage ratios.

•2013 Core FFO guidance introduced at $1.03 to $1.11 per share.