Exhibit 12.1
DEVELOPERS DIVERSIFIED REALTY CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Amounts in Thousands)
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Amounts in Thousands)
| 2005 | 2006 (a) | 2007 (a) | 2008 (a) | 2009 | ||||||||||||||||
| Pretax income (loss) from continuing operations | $ | 249,259 | $ | 235,410 | $ | 240,373 | $ | (103,634 | ) | $ | (310,458 | ) | ||||||||
| Fixed charges: | ||||||||||||||||||||
| Interest expense including amortization of deferred costs and capitalized interest | $ | 176,964 | $ | 219,882 | $ | 285,390 | $ | 286,430 | $ | 259,757 | ||||||||||
| Ground Rent 33% | $ | 1,118 | $ | 1,319 | $ | 1,329 | $ | 1,175 | $ | 1,589 | ||||||||||
| Preferred Dividends on consolidated subsidiaries | $ | — | $ | — | $ | 9,690 | $ | — | $ | — | ||||||||||
| Proportionate share of fixed charges of 50% owned joint ventures accounted for using equity method of accounting | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
| Total fixed charges | $ | 178,082 | $ | 221,201 | $ | 296,409 | $ | 287,605 | $ | 261,346 | ||||||||||
| Capitalized interest during the period | $ | (12,672 | ) | $ | (20,049 | ) | $ | (28,003 | ) | $ | (41,062 | ) | $ | (21,814 | ) | |||||
| Preferred Dividends on consolidated subsidiaries | $ | — | $ | — | $ | (9,690 | ) | $ | — | $ | — | |||||||||
| Amortization of capitalized interest during the period | $ | 3,750 | $ | 4,418 | $ | 5,351 | $ | 6,720 | $ | 7,447 | ||||||||||
| Equity Company Adjustments | $ | (34,873 | ) | $ | (30,337 | ) | $ | (43,229 | ) | $ | (17,719 | ) | $ | 9,733 | ||||||
| Equity Company Adjustments Distributed Income | $ | 34,873 | $ | 30,337 | $ | 43,229 | $ | 17,719 | $ | 8,416 | ||||||||||
| Earnings (loss) before income taxes and fixed charges | $ | 418,419 | $ | 440,980 | $ | 504,440 | $ | 149,629 | $ | (45,330 | ) | |||||||||
| Ratio of earnings to fixed charges | 2.35 | 1.99 | 1.70 | (b | ) | (c | ) | |||||||||||||
| (a) | These periods have been adjusted 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 $138.0 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 Current Report on Form 8-K filed on August 10, 2009, which updates certain portions of the Company’s Annual Report on Form 10-K for the year ended December 31, 2008. | ||
| (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 $306.7 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. |