EX-12.2 3 l40457exv12w2.htm EX-12.2 exv12w2
Exhibit 12.2
DEVELOPERS DIVERSIFIED REALTY CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
(Amounts in Thousands)
                                                         
    Year Ended December 31,     June 30,  
    2005     2006 (a)     2007(a)     2008 (a)     2009     2009     2010  
Pretax income (loss) from continuing operations
   $ 249,259     $ 235,410     $ 240,373     $ (103,634 )   $ (310,458 )   $ (64,937 )   $ (141,267 )
 
                                          
 
                                                        
Fixed charges:
                                                        
Interest expense including amortization of deferred costs and capitalized interest
   $ 176,964     $ 219,882     $ 285,390     $ 286,430     $ 259,757     $ 126,393     $ 125,270  
Ground Rent 33%
   $ 1,118     $ 1,319     $ 1,329     $ 1,175     $ 1,589     $ 724     $ 823  
Preferred Dividends
   $ 55,169     $ 55,169     $ 50,934     $ 42,269     $ 42,269     $ 21,134     $ 21,134  
Proportionate share of fixed charges of 50% owned joint ventures accounted for using equity method of accounting
   $ —     $ —     $ —     $ —     $ —     $ —     $ —  
 
                                          
 
                                                        
Total fixed charges
   $ 233,251     $ 276,370     $ 337,653     $ 329,874     $ 303,615     $ 148,251     $ 147,227  
 
                                          
 
                                                        
Capitalized interest during the period
   $ (12,672 )   $ (20,049 )   $ (28,003 )   $ (41,062 )   $ (21,814 )   $ (11,600 )   $ (6,289 )
Preferred Dividends
   $ (55,169 )   $ (55,169 )   $ (50,934 )   $ (42,269 )   $ (42,269 )   $ (21,134 )   $ (21,134 )
Amortization of capitalized interest during the period
   $ 3,750     $ 4,418     $ 5,351     $ 6,720     $ 7,447     $ 3,553     $ 3,829  
Equity Company Adjustments
   $ (34,873 )   $ (30,337 )   $ (43,229 )   $ (17,719 )   $ 9,733     $ 8,801     $ (1,023 )
Equity Company Adjustments Distributed Income
   $ 34,873     $ 30,337     $ 43,229     $ 17,719     $ 8,416     $ 3,545     $ 2,904  
 
                                          
 
                                                        
Earnings (loss) before income taxes and fixed charges
   $ 418,419     $ 440,980     $ 504,440     $ 149,629     $ (45,330 )   $ 66,479     $ (15,753 )
 
                                          
 
                                                        
Ratio of earnings to combined fixed charges and preferred dividends
     1.79       1.60       1.49       (b )     (c )     (d )     (e )
 
                                          
 
(a)   These periods have been restated to reflect the retrospective application of FSP APB 14-1, also known as ASC 470-02, for interest expense related to the Company’s convertible debt.
 
(b)   Due to the pretax loss from continuing operations for the year ended December 31, 2008, the ratio coverage was less than 1:1. The Company would have needed to generate additional earnings of $180.2 million to achieve a coverage of 1:1 for the year ended December 31, 2008.
 
    The pretax loss from continuing operations for the year ended December 31, 2008, includes consolidated impairment charges of $75.3 million and impairment charges of joint venture investments of $107.0 million that are discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.
 
(c)   Due to the pretax loss from continuing operations for the year ended December 31, 2009, the ratio coverage was less than 1:1. The Company would have needed to generate additional earnings of $348.9 million to achieve a coverage of 1:1 for the year ended December 31, 2009.
 
    The pretax loss from continuing operations for the year ended December 31, 2009, includes consolidated impairment charges of $80.6 million, impairment charges of joint venture investments of $184.6 million and losses on equity derivative instruments of $199.8 million that are discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.
 
(d)   Due to the pretax loss from continuing operations for the six months ended June 30, 2009, the ratio coverage was less than 1:1. The Company would have needed to generate additional earnings of $81.8 million to achieve a coverage of 1:1 for the six months ended June 30, 2009.
 
    The pretax loss from continuing operations for the six months ended June 30, 2009, includes consolidated impairment charges of $55.6 million, impairment charges of joint venture investments of $40.4 million and losses on equity derivative instruments of $80.0 million that are discussed in the Company’s Quarterly Report on Form 10-Q for the six months ended June 30, 2009.
 
(e)   Due to the pretax loss from continuing operations for the six months ended June 30, 2010, the ratio coverage was less than 1:1. The Company would have needed to generate additional earnings of $163.0 million to achieve a coverage of 1:1 for the six months ended June 30, 2010.
 
    The pretax loss from continuing operations for the six months ended June 30, 2010, includes consolidated impairment charges of $131.8 million, and losses on equity derivative instruments of $3.3 million that are discussed in the Company’s Quarterly Report on Form 10-Q for the six months ended June 30, 2010.