North American commercial real estate firm, Brookfield Properties posted lower quarterly funds from operations partly hurt by lower net operating income from commercial and residential development operations.

Funds from operations, a key measure used by real estate companies, were US$148-million, or 38 cents a share, in the second quarter, down from US$157-million, or 40 cents a share, a year earlier.

According to Reuters Estimates, analysts had expected 36 cents a share in funds from operations — a real estate benchmark measure that strips out the distorting effects of depreciation and other factors from earnings.

Commercial property net operating income slipped to US$338- million from US$341-million, while residential development net operating income fell to US$13-million from US$35-million.

The company, one of Manhattan’s largest office landlords, earnings rose 33% to US$60-million, or 15 cents a share, in the three months ended June 30.

During the quarter, Brookfield said it had leased out 725,000 square feet of space.

Brookfield’s 75-million-square-foot portfolio comprises interests in 108 properties and includes the World Financial Center in Manhattan, Brookfield Place in Toronto and Bankers Hall in Calgary, Alta.