After paying preferred dividends, Forest City lost $41.9 million, or 25 cents a share, in the three months ended Oct. 31. That compares with a loss of $50.6 million, or 33 cents a share, in the prior-year quarter.

Revenue declined 9 percent to $261.2 million from $287 million a year earlier, hurt by a drop in revenue at the company's commercial group segment.

Forest City's interest expense fell to $67.2 million from $75.8 million in the prior-year period.

At the end of the quarter, comparable retail occupancies stood at 91.2 percent, up from 90.6 percent a year earlier. Comparable office occupancies were 90.5 percent, down from 91.2 percent.

CEO David J. LaRue said that he feels confident in the underlying strength of the company's business, but noted that the sluggish economy and high unemployment give him reason to remain cautious in his outlook.

Forest City shares ended the regular session down 50 cents, or 4.1 percent, to $11.75 on Thursday.