NEW YORK (Reuters) - General Growth Properties Inc (GGP.N: Quote, Profile, Research), the second-largest U.S. mall operator, reported on Monday that core funds from operations, a performance measure of a real estate investment trust, fell after a charge related to a lawsuit brought about by another developer.

The company reported fourth-quarter core funds from operations, or core FFO, of $271 million, or 92 cents per share, compared with $292 million, or 99 cents per share in the year earlier quarter.

The results included a charge of $52 million, or 18 cents per share, related to a lawsuit by a California shopping center developer.

On a net income basis, the company posted a profit of $58.7 million, or 24 cents per share, compared with $70.2 million, or 29 cents per share in the year-earlier quarter. The fourth-quarter 2007 results include a noncash impairment charge of about $77 million related to the lowered value of residential land held for sale in the Fairwood, Maryland and Columbia, Maryland master planned communities.

Total FFO, which includes the company's master-planned communities operations, was 64 cents per share, while analysts had expected 66 cents per share, according to Reuters Estimates.

"Our core retail real estate business continues to deliver solid operating results," John Bucksbaum, General Growth's chief executive, said in a statement. "We are prepared to handle the expected weaker economic environment and will be well positioned to benefit when the economy begins to show improvement."

General Growth forecasts 2008 core FFO per share in the range of $3.58 to $3.61 per share, while analysts see $3.61, according to Reuters Estimates.

FFO removes the profit-reducing effect that depreciation -- a noncash accounting item -- has on earnings.

In 2004, General Growth bought Rouse Cos. In addition to Rouse's upscale malls, General Growth inherited its master-planned community business, which helped results during the U.S. housing market boom.