<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
(Mark One)
{ X } Annual report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 (Fee Required) for the fiscal year ended
December 31, 1995
-----------------
or
{ } Transition report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934 (No Fee Required) for the
transition period from ___________ to ___________
Commission file number 0-20625
---------------------------------------------------------
DUKE REALTY LIMITED PARTNERSHIP
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Indiana 35-1898425
- ----------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
8888 Keystone Crossing, Suite 1200
Indianapolis, Indiana 46240
- ---------------------------------- ---------------------------------
(Address of principal (Zip Code)
executive offices)
(317) 846-4700
----------------------------------------------------
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class: Name of each exchange on which registered:
None N/A
- ----------------------------------- ------------------------------------------
Securities registered pursuant to Section 12(g) of the Act: Limited Partner
Units
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
----- -----
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
Regulation S-K is not contained herein, and will not be contained, to the best
of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. ( X )
The aggregate market value of the Limited Partner Units held by non-affiliates
of Registrant is $55,313,052 based on the last reported sale price of the common
shares of Duke Realty Investments, Inc., into which Limited Partner Units are
exchangeable, on March 11, 1996.
The number of Limited Partnership Units outstanding as of March 11, 1996 was
4,558,457.
DOCUMENTS INCORPORATED BY REFERENCE
Part III incorporates by reference the Proxy Statement of Duke Realty
Investments, Inc. related to the Annual Meeting of Shareholders to be held April
25, 1996.
<PAGE>
TABLE OF CONTENTS
FORM 10-K
Item No. Page(s)
- -------- -------
PART I
1. Business ................................................. 1 - 3
2. Properties ............................................... 3 - 10
3. Legal Proceedings ........................................ 11
4. Submission of Matters to a Vote of Security Holders ...... 11
PART II
5. Market for the Registrant's Equity and
Related Security Holder Matters ........................ 11
6. Selected Financial Data .................................. 12
7. Management's Discussion and Analysis of
Financial Condition and Results of Operations .......... 13 - 20
8. Financial Statements and Supplementary Data .............. 20
9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure ................. 20
PART III
10. Directors and Executive Officers of the
Registrant ............................................. 21 - 23
11. Executive Compensation ................................... 23
12. Security Ownership of Certain Beneficial Owners
and Management ......................................... 23
13. Certain Relationships and Related
Transactions ........................................... 23
PART IV
14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K .................................... 23 - 48
Signatures ......................................................... 49 - 50
Exhibits
<PAGE>
PART I
ITEM 1. BUSINESS
Duke Realty Limited Partnership (the "Partnership") was formed on October 4,
1993, when Duke Realty Investments, Inc. (the "Predecessor Company" or the
"General Partner") contributed all of its properties and related assets and
liabilities along with the net proceeds of $309.3 million from the issuance of
an additional 14,000,833 shares through an offering (the "1993 Offering") to the
Partnership. Simultaneously, the Partnership completed the acquisition of Duke
Associates, a full-service commercial real estate firm operating in the Midwest.
The General Partner was formed in 1985 and qualifies as a real estate investment
trust under provisions of the Internal Revenue Code. The General Partner is the
sole general partner of the Partnership currently owning 84.1% of the
partnership interest ("Units"). The remaining 15.9% of the Partnership is owned
by limited partners ("Limited Partner Units").
The Partnership's primary business segment is the ownership and rental of
industrial, office and retail properties throughout the Midwest. As of December
31, 1995, it owned interests in a diversified portfolio of 215 rental properties
comprising 23.5 million square feet (including 13 properties and two expansions
comprising 3.4 million square feet under development). Substantially all of
these properties are located in the Partnership's primary markets of
Indianapolis, Indiana; Cincinnati, and Columbus, Ohio; Detroit, Michigan; St.
Louis, Missouri and Nashville, Tennessee. In addition to its Rental Operations,
the Partnership through its Service Operations provides, on a fee basis,
leasing, management, construction, development and other real estate services
for approximately 9.7 million square feet of properties owned by third-parties.
See Item 7, "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and Item 8 "Financial Statements and Supplementary Data"
for financial information of these industry segments. The Partnership conducts
its Service Operations through Duke Realty Services Limited Partnership and Duke
Construction Limited Partnership, in which the Partnership has an 89% profits
interest (after certain preferred returns on partners' capital accounts) and
effective control of their operations. The Partnership has the largest
commercial real estate operations in Indianapolis and Cincinnati and is one of
the largest real estate companies in the Midwest.
The Partnership's corporate headquarters and executive offices are located in
Indianapolis, Indiana. In addition, the Partnership has six regional offices
located in Cincinnati, Ohio; Columbus, Ohio; Decatur, Illinois; Detroit,
Michigan; Nashville, Tennessee and St. Louis, Missouri. The Partnership had 425
employees as of December 31, 1995.
BUSINESS STRATEGY
The Partnership's business objective is to increase its Funds From Operations
("FFO") by (i) maintaining and increasing property occupancy and rental rates
through the aggressive management of its portfolio of existing properties;
(ii) expanding existing properties; (iii) developing and acquiring new
properties; and (iv) providing a full line of real estate services to the
Partnership's tenants and to third-parties. FFO is defined by the National
Association of Real Estate Investment Trusts as net income or loss excluding
gains or losses from debt restructuring and sales of property plus depreciation
and amortization, and after adjustments for minority interest, unconsolidated
partnerships and joint ventures (adjustments for minority interest,
unconsolidated partnerships and joint ventures are calculated to reflect FFO
on the same basis). While management believes that FFO is a relevant measure
of the Partnership's operating performance because it is widely used by
industry analysts to measure the operating performance of equity REITs and
real estate partnerships, such amount does not represent cash flow from
operations as defined by generally accepted accounting principles, should
not be considered as an alternative to net income as an indicator of the
Partnership's operating performance, and is not indicative of cash available
to fund all cash flow needs. As a fully integrated commercial real estate
firm, the Partnership believes that its in-house leasing, management,
development and construction services and the Partnership's significant base
of commercially zoned and unencumbered land in existing business parks should
give the Partnership a competitive advantage in its future development
activities.
- 1 -
<PAGE>
The Partnership believes that the analysis of real estate opportunities and
risks can be done most effectively at regional or local levels. As a result,
the Partnership intends to continue its emphasis on increasing its market share
and effective rents in its primary markets within the Midwest. The Partnership
also expects to utilize its approximately 1,150 acres of unencumbered land and
its many business relationships with more than 2,600 commercial tenants to
expand its build-to-suit business (development projects substantially pre-leased
to a single tenant) and to pursue other development and acquisition
opportunities in its primary markets and elsewhere, in the Midwest. The
Partnership believes that this regional focus will allow it to assess market
supply and demand for real estate more effectively as well as to capitalize on
its strong relationships with its tenant base.
The Partnership's policy is to seek to develop and acquire Class A commercial
properties located in markets with high growth potential for Fortune 500
companies and other quality regional and local firms. The Partnership's
industrial and suburban office development focuses on business parks and mixed-
use developments suitable for development of multiple projects on a single site
where the Partnership can create and control the business environment. These
business parks and mixed-use developments generally include restaurants and
other amenities which the Partnership believes will create an atmosphere that is
particularly efficient and desirable. The Partnership's retail development
focuses on community, power and neighborhood centers in its existing markets. As
a fully integrated real estate company, the Partnership is able to arrange for
or provide to its industrial, office and retail tenants not only well located
and well maintained facilities, but also additional services such as build-to-
suit construction, tenant finish construction, expansion flexibility and
advertising and marketing services.
Consistent with its business strategy of expanding in attractive Midwestern
markets, the Partnership carefully analyzed the real estate investment potential
of several major Midwestern metropolitan areas. Based on this analysis,
management concluded that the St. Louis and Cleveland markets offer attractive
real estate investment returns in the industrial and suburban office markets
based on the following factors: (i) fragmented competition; (ii) strong real
estate fundamentals; and (iii) favorable economic conditions.
In 1995, the Partnership established a regional office in St. Louis and acquired
463,000 square feet of suburban office properties and 153 acres of land for the
future development of industrial properties. In February 1996, the Partnership
acquired a 782,000 square foot suburban office portfolio and the operating
personnel of an independent real estate developer and operator in Cleveland.
The Partnership intends to aggressively pursue the development and acquisition
of additional rental properties in both the St. Louis and Cleveland markets.
All of the Partnership's properties are located in areas that include
competitive properties. Such properties are generally owned by institutional
investors or other local real estate operators; however, no single competitor or
small group of competitors is dominant in the Partnership's markets. The supply
and demand of similar available rental properties may affect the rental rates
the Partnership will receive on its properties. Based upon the current occupancy
rates in the Partnership and competitive properties, the Partnership believes
there will not be significant competitive pressure to lower rental rates in the
near future.
- 2 -
<PAGE>
FINANCING STRATEGY
The Partnership seeks to maintain a well-balanced, conservative and flexible
capital structure by: (i) currently targeting a ratio of long-term debt to total
market capitalization in the range of 25% to 40%; (ii) extending and sequencing
the maturity dates of its debt; (iii) borrowing primarily at fixed rates; (iv)
generally pursuing current and future long-term debt financings and refinancings
on an unsecured basis; and (v) maintaining conservative debt service and fixed
charge coverage ratios. Management believes that these strategies have enabled
and should continue to enable the Partnership to access the debt and equity
capital markets for their long-term requirements such as debt refinancings and
financing development and acquisitions of additional rental properties. In
October 1993, the General Partner received $309.3 million of the net proceeds
from the issuance of common stock (the "1993 Offering"), in September 1994, the
General Partner received $92.1 million of net proceeds from the issuance of
common stock (the "1994 Offering"), in May 1995, the General Partner received
$96.3 million of net proceeds from the issuance of common stock (the "1995
Offering") and in September 1995, the Partnership issued $150.0 million of
unsecured debt (the "1995 Debt Offering"). All of the proceeds from the equity
offerings were contributed to the Partnership by the General Partner. Based on
these offerings, the General Partner and the Partnership have demonstrated their
abilities to access the public markets as a source of capital to fund future
growth. In addition, as discussed under Item 7, "Management's Discussion and
Analysis of Financial Condition and Results of Operations," the Partnership
has a $150.0 million line of credit available for short-term fundings of
development and acquisition of additional rental properties. The
Partnership's debt to total market capitalization ratio (total market
capitalization is defined as the total market value of all Units outstanding
plus outstanding indebtedness) at March 8, 1996 was 38.3%. The Partnership's
ratio of earnings to debt service and ratio of earnings to fixed charges for
the year ended December 31,1995 were 2.79x and 2.38x, respectively. In
computing the ratio of earnings to debt service, earnings have been
calculated by adding debt service to income before gains or losses on
property sales. Debt service consists of interest and recurring principal
amortization (excluding maturities) and excludes amortization of debt
issuance costs. In computing the ratio of earnings to fixed charges, earnings
have been calculated by adding fixed charges, excluding capitalized interest,
to income before gains or losses on property sales. Fixed charges consist (if
applicable) of interest costs, whether expensed or capitalized, the interest
component of rental expense, amortization of debt issuance costs and
preferred stock distributions. Management believes these measures to be
consistent with its financing strategy.
OTHER
The Partnership's operations are not dependent on a single or few customers as
no single customer accounts for more than 3% of the Partnership's total revenue.
The Partnership's operations are not subject to any significant seasonal
fluctuations. The Partnership believes it is in compliance with environmental
regulations and does not anticipate material effects of continued compliance.
For additional information regarding the Partnership's investments and
operations, see Item 7, "Management's Discussion and Analysis of Financial
Condition and Results of Operations," and Item 8, "Financial Statements and
Supplementary Data." For additional information about the Partnership's business
segments see Item 8, "Financial Statements and Supplementary Data."
ITEM 2. PROPERTIES
The Partnership owns an interest in a diversified portfolio of 215 commercial
properties encompassing approximately 23.5 million net rentable square feet
located primarily in five states and approximately 1,150 acres of land for
future development. (See Notes 4 and 5 to Financial Statements, Item 8 hereof.)
The properties are described on the following pages.
- 3 -
<PAGE>
<TABLE>
<CAPTION>
PERCENT
OCCUPIED AT
NAME/ OWNERSHIP PARTNERSHIP'S YEAR LAND AREA NET RENTABLE DECEMBER 31,
LOCATION INTEREST OWNERSHIP CONSTRUCTED (ACRES) AREA (SQ.FT.) 1995
- -------- --------- ------------- ----------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
INDUSTRIAL
INDIANAPOLIS, INDIANA
PARK 100 BUSINESS PARK
Building 38 Fee 100% 1978 1.11 6,000 100%
Building 48 Fee 50% (1) 1984 8.63 127,410 100%
Building 49 Fee 50% (1) 1982 4.55 89,600 100%
Building 50 Fee 50% (1) 1982 4.09 51,200 100%
Building 52 Fee 50% (1) 1983 2.70 34,800 100%
Building 53 Fee 50% (1) 1984 4.23 76,800 100%
Building 54 Fee 50% (1) 1984 4.42 76,800 100%
Building 55 Fee 50% (1) 1984 3.83 43,200 100%
Building 56 Fee 50% (1) 1984 15.94 300,000 100%
Building 57 Fee 50% (1) 1984 7.70 128,800 100%
Building 58 Fee 50% (1) 1984 8.03 128,800 100%
Building 59 Fee 50% (1) 1985 5.14 83,200 100%
Building 60 Fee 50% (1) 1985 4.78 83,200 100%
Building 62 Fee 50% (1) 1986 7.70 128,800 100%
Building 67 Fee 50% (1) 1987 4.23 72,350 100%
Building 68 Fee 50% (1) 1987 4.23 72,360 100%
Building 71 Fee 50% (1) 1987 9.06 193,400 100%
Building 74 Fee 10%-50% (2) 1988 12.41 257,400 100%
Building 76 Fee 10%-50% (2) 1988 5.10 81,695 100%
Building 78 Fee 10%-50% (2) 1988 21.80 512,777 100%
Building 79 Fee 100% 1988 4.47 66,000 100%
Building 80 Fee 100% 1988 4.47 66,000 100%
Building 83 Fee 100% 1989 5.34 96,000 100%
Building 84 Fee 100% 1989 5.34 96,000 100%
Building 85 Fee 10%-50% (2) 1989 9.70 180,100 100%
Building 89 Fee 10%-50% (2) 1990 11.28 311,600 100%
Building 91 Fee 10%-50% (2) 1990 7.53 144,000 80%
Building 92 Fee 10%-50% (2) 1991 4.38 45,917 100%
Building 95 Fee 100% 1993 15.23 336,000 100%
Building 96 Fee 100% 1994 27.69 553,900 100%
Building 97 Fee 100% 1994 13.38 280,800 100%
Building 98 Fee 100% 1968 37.34 508,306 100%
Building 99 Fee 50% (3) 1994 18.00 364,800 100%
Building 100 Fee 100% 1995 7.00 117,500 100%
Building 101 Fee 50% (1) 1983 4.37 45,000 86%
Building 105 Fee 50% (1) 1983 4.64 41,400 100%
Building 106 Fee 50% (1) 1978 4.64 41,400 94%
Building 107 Fee 100% 1984 3.56 58,783 97%
Building 108 Fee 50% (1) 1983 6.36 60,300 81%
Building 109 Fee 100% 1985 4.80 46,000 100%
Building 113 Fee 50% (1) 1987 6.20 72,000 100%
Building 114 Fee 50% (1) 1987 6.20 56,700 98%
Building 117 Fee 10%-50% (2) 1988 13.36 135,600 100%
Building 120 Fee 10%-50% (2) 1989 4.54 54,982 100%
Building 122 Fee 100% 1990 6.17 73,274 100%
Building 125 Fee 100% (4) 1994 13.81 195,080 100%
Building 126 Fee 100% 1984 4.04 60,100 100%
Building 127 Fee 100% 1995 6.50 93,600 100%
PARK FLETCHER
Building 2 Fee 50% (1) 1970 1.31 20,160 0%
Building 4 Fee 50% (1) 1974 1.73 23,000 100%
Building 6 Fee 50% (1) 1971 3.13 36,180 85%
Building 7 Fee 50% (1) 1974 3.00 41,900 100%
Building 8 Fee 50% (1) 1974 2.11 18,000 100%
Building 14 Fee 100% 1978 1.39 19,480 100%
Building 15 Fee 50% (1) 1979 5.74 72,800 100%
Building 16 Fee 50% (1) 1979 3.17 35,200 100%
Building 18 Fee 50% (1) 1980 5.52 43,950 100%
Building 21 Fee 50% (1) 1983 2.95 37,224 66%
Building 22 Fee 50% (1) 1983 2.96 48,635 100%
- 4 -
<PAGE>
<CAPTION>
PERCENT
OCCUPIED AT
NAME/ OWNERSHIP PARTNERSHIP'S YEAR LAND AREA NET RENTABLE DECEMBER 31,
LOCATION INTEREST OWNERSHIP CONSTRUCTED (ACRES) AREA (SQ.FT.) 1995
- -------- --------- ------------- ----------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Building 26 Fee 50% (1) 1983 2.91 28,340 100%
Building 27 Fee 25% (1) 1985 3.01 39,178 100%
Building 28 Fee 25% (1) 1985 7.22 93,880 90%
Building 29 Fee 50% (1) 1987 7.16 92,044 83%
Building 30 Fee 50% (1) 1989 5.93 78,568 100%
Building 31 Fee 50% (1) 1990 2.62 33,029 100%
Building 32 Fee 50% (1) 1990 5.43 67,297 64%
SHADELAND STATION
Buildings 204 & 205 Fee 100% 1984 4.09 48,600 100%
HUNTER CREEK BUSINESS PARK
Building 1 Fee 10%-50% (2) 1989 5.97 86,500 100%
Building 2 Fee 10%-50% (2) 1989 8.86 202,560 87%
HILLSDALE TECHNECENTER
Building 1 Fee 50% (1) 1986 9.16 73,436 90%
Building 2 Fee 50% (1) 1986 5.50 83,600 100%
Building 3 Fee 50% (1) 1987 5.50 84,050 100%
Building 4 Fee 100% 1987 7.85 73,874 100%
Building 5 Fee 100% 1987 5.44 67,500 98%
Building 6 Fee 100% 1987 4.25 64,000 100%
Franklin Road
Business Center Fee 100% 1962, 1971, 1974 28.00 367,065 90%
Palomar Business
Center Fee 100% 1973 4.50 99,350 100%
Nampac Fee 100% 1974 6.20 83,200 100%
CARMEL, INDIANA
HAMILTON CROSSING
Building 1 Fee 100% 1989 4.70 51,825 93%
GREENWOOD, INDIANA
SOUTH PARK BUSINESS CENTER
Building 2 Fee 100% 1990 7.10 86,806 92%
CINCINNATI, OHIO
PARK 50 TECHNECENTER
Building 20 Fee 100% 1987 8.37 96,000 100%
Building 25 Fee 100% 1989 12.20 78,328 89%
GOVERNOR'S POINTE
4700 Building Fee 100% 1987 5.51 76,400 94%
4800 Building Fee 100% 1989 7.07 80,000 92%
4900 Building Fee 100% 1987 9.41 76,400 100%
WORLD PARK
Building 5 Fee 100% 1987 5.00 59,700 79%
Building 6 Fee 100% 1987 7.26 92,400 100%
Building 7 Fee 100% 1987 8.63 96,000 100%
Building 8 Fee 100% 1989 14.60 192,000 100%
Building 9 Fee 100% 1989 4.47 58,800 84%
Building 11 Fee 100% 1989 8.98 96,000 100%
Building 14 Fee 100% 1989 8.91 166,400 100%
Building 15 Fee 100% 1990 6.50 93,600 100%
Building 16 Fee 100% 1989 7.00 93,600 100%
MicroAge Fee 50% (1) 1994 15.10 304,000 100%
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<PAGE>
<CAPTION>
PERCENT
OCCUPIED AT
NAME/ OWNERSHIP PARTNERSHIP'S YEAR LAND AREA NET RENTABLE DECEMBER 31,
LOCATION INTEREST OWNERSHIP CONSTRUCTED (ACRES) AREA (SQ.FT.) 1995
- -------- --------- ------------- ----------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
ENTERPRISE BUSINESS PARK
Building 1 Fee 100% 1990 7.52 87,400 85%
Building 2 Fee 100% 1990 7.52 84,940 97%
Building A Fee 100% 1987 2.65 20,888 100%
Building B Fee 100% 1988 2.65 34,940 95%
Building D Fee 100% 1989 5.40 60,322 100%
TRI-COUNTY BUSINESS PARK
Xetron Fee 10% (5) 1994 29.00 100,193 100%
FAIRFIELD BUSINESS CENTER
Building D Fee 100% 1990 3.23 40,223 89%
Building E Fee 100% 1990 6.07 75,600 83%
OTHER INDUSTRIAL-CINCINNATI
U.S. Post Office Building Fee 40% (6) 1992 2.60 57,886 100%
University Moving Fee 100% 1991 4.95 70,000 100%
COLUMBUS, OHIO
Pet Foods Building Fee 100% 1993 16.22 276,000 100%
MBM Building Fee 100% 1978 3.98 83,000 100%
South Pointe A Fee 100% 1995 14.06 293,824 70%
HEBRON, KENTUCKY
SOUTHPARK BUSINESS CENTER
Building 1 Fee 100% 1990 7.90 96,000 57%
Building 3 Fee 100% 1991 10.79 192,000 87%
CR Services Fee 100% 1994 22.50 214,840 100%
Redken Laboratories Fee 100% 1994 28.79 166,400 100%
LOUISVILLE, KENTUCKY
Dayco Fee 50% (1) 1995 30.00 282,539 100%
DECATUR, ILLINOIS
PARK 101 BUSINESS CENTER
Building 3 Fee 100% 1979 5.76 75,600 80%
Building 8 Fee 100% 1980 3.16 50,400 95%
NASHVILLE, TENNESSEE
HAYWOOD OAKS TECHNECENTER
Building 2 Fee 100% 1988 2.94 50,400 91%
Building 3 Fee 100% 1988 2.94 52,800 100%
Building 4 Fee 100% 1988 5.23 46,800 83%
Building 5 Fee 100% 1988 5.23 61,171 100%
Building 6 Fee 100% 1989 10.53 113,400 100%
Building 7 Fee 100% 1995 8.24 66,873 57%
Greenbriar Business Park Fee 100% 1986 10.73 134,759 96%
Keebler Building Fee 100% 1985 4.39 36,150 100%
MILWAUKEE, WISCONSIN
S.F. Music Box Building Fee 33% (7) 1993 8.90 153,600 100%
OFFICE
INDIANAPOLIS, INDIANA
PARK 100 BUSINESS PARK
Building 34 Fee 100% 1979 2.00 22,272 93%
Building 116 Fee 100% 1988 5.28 35,700 91%
Building 118 Fee 100% 1988 6.50 35,700 100%
Building 119 Fee 100% 1989 6.50 53,300 100%
CopyRite Building Fee 50% (8) 1992 3.88 48,000 100%
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<PAGE>
<CAPTION>
PERCENT
OCCUPIED AT
NAME/ OWNERSHIP PARTNERSHIP'S YEAR LAND AREA NET RENTABLE DECEMBER 31,
LOCATION INTEREST OWNERSHIP CONSTRUCTED (ACRES) AREA (SQ.FT.) 1995
- -------- --------- ------------- ----------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
WOODFIELD AT THE CROSSING
Two Woodfield Crossing Fee 100% 1987 7.50 117,818 94%
Three Woodfield Crossing Fee 100% 1989 13.30 259,777 94%
PARKWOOD CROSSING
One Parkwood Fee 100% 1989 5.93 108,281 100%
SHADELAND STATION
7240 Shadeland Station Fee 67% (9) 1985 2.14 45,585 95%
7330 Shadeland Station Fee 100% 1988 4.50 42,619 100%
7340 Shadeland Station Fee 100% 1989 2.50 32,235 100%
7351 Shadeland Station Fee 100% 1983 2.14 27,740 98%
7369 Shadeland Station Fee 100% 1989 2.20 15,551 100%
7400 Shadeland Station Fee 100% 1990 2.80 49,544 100%
KEYSTONE AT THE CROSSING
F.C. Tucker Building (10) Fee/Ground 100% 1978 N/A 4,840 100%
Lease
3520 Commerce Crossing (11) Ground/Bldg. 100% 1976 N/A 30,000 100%
Lease
8465 Keystone Fee 100% 1983 1.31 28,298 92%
CARMEL, INDIANA
CARMEL MEDICAL CENTER
Building I (12) Fee/Ground 100% 1985 N/A 40,060 87%
Lease
Building II (12) Fee/Ground 100% 1989 N/A 39,973 91%
Lease
GREENWOOD, INDIANA
SOUTH PARK BUSINESS CENTER
Building 1 Fee 100% 1989 5.40 39,715 100%
Building 3 Fee 100% 1990 3.25 35,900 95%
St. Francis Medical Fee/Ground 100% 1995 N/A 95,579 75%
Building(13) Lease
Community MOB Fee 100% 1995 4.00 38,193 100%
CINCINNATI, OHIO
GOVERNOR'S HILL
8600 Governor's Hill Fee 100% 1986 10.79 200,584 93%
8700 Governor's Hill Fee 100% 1985 4.98 58,617 100%
8790 Governor's Hill Fee 100% 1985 5.00 58,177 72%
8800 Governor's Hill Fee 100% 1985 2.13 28,700 100%
GOVERNOR'S POINTE
4605 Governor's Pointe Fee 100% 1990 8.00 175,485 100%
4705 Governor's Pointe Fee 100% 1988 7.50 140,984 98%
4770 Governor's Pointe Fee 100% 1986 4.50 76,037 88%
PARK 50 TECHNECENTER
SDRC Building Fee 100% 1991 13.00 221,215 100%
Building 17 Fee 100% 1985 8.19 70,644 91%
DOWNTOWN CINCINNATI
311 Elm Street (14) Ground/Bldg. 100% 1902/1986 (15) N/A 90,127 100%
Lease
312 Plum Street Fee 100% 1987 .69 230,489 89%
312 Elm Street Fee 100% 1992 1.10 378,786 92%
KENWOOD COMMONS
Building I Fee 50% (16) 1986 2.09 46,470 99%
Building II Fee 50% (16) 1986 2.09 46,434 90%
OTHER OFFICE - CINCINNATI
Triangle Office Park Fee 100% 1965/1985 (17) 15.64 172,650 61%
Fidelity Drive Building Fee 100% 1972 8.34 38,000 100%
Tri-County Office Park Fee 100% 1971, 1973,1982 (18) 11.27 102,166 81%
- 7 -
<PAGE>
<CAPTION>
PERCENT
OCCUPIED AT
NAME/ OWNERSHIP PARTNERSHIP'S YEAR LAND AREA NET RENTABLE DECEMBER 31,
LOCATION INTEREST OWNERSHIP CONSTRUCTED (ACRES) AREA (SQ.FT.) 1995
- -------- --------- ------------- ----------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
COLUMBUS, OHIO
TUTTLE CROSSING
4600 Lakehurst
(Sterling 1) Fee 100% 1990 7.66 106,300 100%
4650 Lakehurst (Litel) Fee 100% 1990 13.00 164,639 100%
5555 Parkcenter (Xerox) Fee 100% 1992 6.09 83,971 100%
4700 Lakehurst
(Indiana Insurance) Fee 100% 1994 3.86 49,600 100%
Sterling 2 Fee 100% 1995 3.33 57,660 100%
John Alden Fee 100% 1995 6.51 101,200 100%
Cardinal Health Fee 100% 1995 10.95 132,854 100%
Veterans Administration
Clinic Fee 100% 1994 4.98 118,000 100%
LIVONIA, MICHIGAN
SEVEN MILE CROSSING
38705 Seven Mile (19) Fee/Ground 100% 1988 N/A 113,066 95%
Lease
38701 Seven Mile (19) Fee/Ground 100% 1989 N/A 132,153 85%
Lease
ST. LOUIS, MISSOURI
Laumeier I Fee 100% 1987 4.29 113,852 99%
Laumeier II Fee 100% 1988 4.64 110,541 100%
Westview Place Fee 100% 1988 2.69 114,722 98%
Westmark Fee 100% 1987 6.95 123,889 100%
RETAIL
INDIANAPOLIS, INDIANA
PARK 100 BUSINESS PARK
Building 121 Fee 100% 1989 2.27 19,716 76%
Building 32 Fee 100% 1978 .82 14,504 89%
CASTLETON CORNER
Michael's Plaza Fee 100% 1984 4.50 46,374 98%
Cub Plaza Fee 100% 1986 6.83 60,136 89%
FORT WAYNE, INDIANA
Coldwater Crossing Fee 100% 1990 35.38 246,365 95%
GREENWOOD, INDIANA
GREENWOOD CORNER
First Indiana Bank Branch Fee 100% 1988 1.00 2,400 100%
Greenwood Corner Shoppes Fee 100% 1986 7.45 50,840 50%
DAYTON, OHIO
Sugarcreek Plaza Fee 100% 1988 17.46 77,940 92%
CINCINNATI, OHIO
Governor's Plaza Fee 100% 1990 35.00 181,493 100%
King's Mall Shopping
Center I Fee 100% 1990 5.68 52,661 100%
King's Mall Shopping
Center II Fee 100% 1988 8.90 67,725 85%
Steinberg's Fee 100% 1993 1.90 21,008 100%
Park 50 Plaza Fee 100% 1989 2.20 18,000 42%
Kohl's Fee 100% 1994 12.00 80,684 100%
Sports Unlimited Fee 100% 1994 7.00 67,148 100%
Eastgate Square (20) Fee 100% 1990 11.60 94,182 100%
Office Max Fee 100% 1995 2.25 23,484 100%
Sofa Express - Governor's
Plaza Fee 100% 1995 1.13 15,000 100%
ELLISVILLE, MISSOURI
Ellisville Plaza (21) Fee 100% 1987 3.70 32,754 96%
- 8 -
<PAGE>
<CAPTION>
PERCENT
OCCUPIED AT
NAME/ OWNERSHIP PARTNERSHIP'S YEAR LAND AREA NET RENTABLE DECEMBER 31,
LOCATION INTEREST OWNERSHIP CONSTRUCTED (ACRES) AREA (SQ.FT.) 1995
- -------- --------- ------------- ----------- --------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
BLOOMINGTON, ILLINOIS
Lakewood Plaza Fee 100% 1987 11.23 87,010 98%
CHAMPAIGN, ILLINOIS
Market View Fee 100% 1985 8.50 86,553 100%
LIVONIA, MICHIGAN
Cooker Restaurant Ground 100% N/A N/A N/A 100%
Lease (22)
COLUMBUS, OHIO
Galyans Trading Company Fee 100% 1994 4.90 74,636 100%
Best Buy Fee 100% 1995 7.00 68,400 85%
UNDER CONSTRUCTION
<CAPTION>
EXPECTED
IN-SERVICE PERCENT
DATE PRE-LEASED
---------- ----------
<S> <C> <C> <C> <C> <C> <C>
INDUSTRIAL
INDIANAPOLIS, INDIANA
PARK 100 BUSINESS PARK
Building 128 Fee 100% February 1996 14.40 322,000 100%
Thomson Consumer
Electronics Fee 100% (23) February 1996 52.00 599,040 100%
LEBANON, INDIANA
American Air Filter Fee 100% April 1996 10.40 153,600 100%
Little, Brown and Company Fee 100% (23) September 1996 31.60 500,455 100%
COLUMBUS, OHIO
South Pointe B Fee 100% April 1996 13.16 307,200 0%
OFFICE
INDIANAPOLIS, INDIANA
Two Parkwood Fee 100% February 1996 5.96 93,300 88%
CINCINNATI, OHIO
Ohio National Fee 100% September 1996 9.00 212,125 67%
COLUMBUS, OHIO
TUTTLE CROSSING
Nationwide Fee 100% July 1996 17.90 315,102 100%
Sterling 3 Fee 100% September 1996 3.56 64,500 100%
MIAMI, FLORIDA
John Alden Fee 100% January/March 1996 7.81 251,316 100%
RETAIL
CINCINNATI, OHIO
Bigg's Supercenter Fee 100% August 1996 14.00 160,000 100%
Fountain Place Fee 25% September 1997 1.98 209,585 79%
COLUMBUS, OHIO
TUTTLE CROSSING
WalMart Fee 100% April 1996 13.00 149,429 100%
-------- ----------
1,632.23 23,520,898
-------- ----------
-------- ----------
</TABLE>
- 9 -
<PAGE>
(1) These buildings are owned by a limited liability company in which the
Partnership is a 50% partner. The Partnership shares in the profit or loss
from such buildings in accordance with the Partnership's ownership
interest. This limited liability company owns a 50% general partnership
interest in Park Fletcher Buildings 27 and 28 and shares in the profit or
loss from these buildings in accordance with the limited liability
company's interest.
(2) These buildings are owned by a partnership in which the Partnership is a
partner. The Partnership owns a 10% capital interest in the partnership
and receives a 50% interest in the residual cash flow after payment of a 9%
preferred return to the other partner on its capital interest.
(3) This building is owned in partnership with a tenant of the building. The
Partnership owns a 50% general partnership interest in the partnership. The
Partnership shares in the profit or loss from the building in accordance
with such ownership interest.
(4) The square footage of this building and the percent occupied includes a
100% pre-leased expansion of 97,080 square feet which is under construction
as of December 31, 1995.
(5) This building is owned by a partnership in which the Partnership owns a 10%
limited partnership interest. The Partnership shares in the cash flow from
the building in accordance with such ownership interest.
(6) This building is owned by a limited partnership in which the Partnership
has a 1% general partnership interest and a 39% limited partnership
interest. The Partnership shares in the profit or loss from such building
in accordance with the Partnership's ownership interest.
(7) This building is owned by a partnership in which the Partnership owns a
33.33% limited partnership interest. The Partnership shares in the profit
or loss from the building in accordance with such ownership interest.
(8) This building is owned in partnership with a tenant of the building. The
Partnership owns a 50% general partnership interest in the partnership. The
Partnership shares in the profit or loss from the building in accordance
with such ownership interest.
(9) The Partnership owns a 66.67% general partnership interest in the
partnership owning this building. The Partnership shares in the profit or
loss of this building in accordance with the Partnership's partnership
interest.
(10) The Partnership owns the building and has a leasehold interest in the land
underlying this building with a lease term expiring October 31, 2067.
(11) The Partnership has a leasehold interest in this building with a lease term
expiring May 9, 2006.
(12) The Partnership owns these buildings and has a leasehold interest in the
land underlying these buildings, with the lease term expiring
November 16, 2043.
(13) The Partnership owns this building and has a leasehold interest in the land
underlying this building with a lease term expiring August 2045, with two
20-year options.
(14) The Partnership has a leasehold interest in the building and the underlying
land with a lease term expiring December 31, 2020. The Partnership has an
option to purchase the fee interest in the property throughout the term of
the lease.
(15) This building was renovated in 1986.
(16) These buildings are owned by a partnership in which the Partnership has a
50% general partnership interest. The Partnership shares in the profit or
loss from such buildings in accordance with the Partnership's ownership
interest.
(17) This building was renovated in 1985.
(18) Tri-County Office Park consists of four buildings. One was built in 1971,
two were built in 1973, and one was built in 1982.
(19) The Partnership owns these buildings and has a leasehold interest in the
land underlying these buildings, with a lease term expiring May 31, 2057.
(20) The square footage of this building and the percent occupied includes a
100% pre-leased expansion of 13,500 square feet which is under construction
as of December 31, 1995.
(21) This building was sold in January 1996.
(22) The Partnership has a leasehold interest in the land with the lease term
expiring May 31, 2057 and subleases the land to the tenant with the
sublease term expiring on August 31, 2009.
(23) These two buildings will be contributed to the limited liability company
referenced in footnote (1) upon completion.
- 10 -
<PAGE>
ITEM 3. LEGAL PROCEEDINGS
There are no pending legal proceedings to which the Partnership or any
subsidiary was a party or to which any of their property is subject other than
routine litigation incidental to the Partnership's business. In the opinion of
management, such litigation is not material to the Partnership's business
operations or financial condition.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the fourth
quarter of the year ended December 31, 1995.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S EQUITY AND RELATED SECURITY HOLDER MATTERS
There is no established public trading market for the Limited Partner Units. Set
forth below are the cash distributions declared during each quarter. Comparable
cash distributions are expected in the future. As of February 12, 1996, there
were 88 record holders of Limited Partner Units.
On February 1, 1996, the Partnership declared a quarterly cash distribution of
$0.49 per Unit payable on February 29, 1996 to Unitholders of record on February
15, 1996.
<TABLE>
<CAPTION>
1995 DISTRIBUTIONS 1994 DISTRIBUTIONS
------------------- -------------------
QUARTER ENDED
- -------------
<S> <C> <C>
December 31 $ .49 $ .47
September 30 .49 .47
June 30 .47 .45
March 31 .47 .45
</TABLE>
- 11 -
<PAGE>
ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA
The following sets forth selected consolidated financial and operating
information on a historical basis for the Partnership for the years ended
December 31, 1995, 1994, 1993, 1992, and 1991. The following information should
be read in conjunction with Item 7, "Management's Discussion and Analysis of
Financial Condition and Results of Operations" for the Partnership and Item 8,
the "Financial Statements and Supplementary Data" included in this Form 10-K.
The historical operating data for the years ended December 31, 1995, 1994 and
1993 has been derived from the historical financial statements of the
Partnership and the Predecessor Company. The historical operating data for the
years ended 1992 and 1991 has been derived from the historical financial
statements of the Predecessor Company.
<TABLE>
<CAPTION>
(in thousands, except per share amounts)
1995 1994 1993 1992 1991
----------- --------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C>
RESULTS OF OPERATIONS:
Revenues:
Rental Operations $ 113,641 $ 89,299 $ 33,648 $ 17,675 $ 16,789
Service Operations 17,777 18,473 5,654 - -
----------- --------- --------- ---------- ----------
TOTAL REVENUES $ 131,418 $ 107,772 $ 39,302 $ 17,675 $ 16,789
----------- --------- --------- ---------- ----------
----------- --------- --------- ---------- ----------
NET INCOME (LOSS) $ 41,600 $ 32,968 $ 6,670 $ (653) $ (1,607)
----------- --------- --------- ---------- ----------
----------- --------- --------- ---------- ----------
PER UNIT DATA (1):
Net Income (Loss) per Unit $ 1.55 $ 1.54 $ 1.02 $ (.32) $ (.79)
Distributions Declared per Unit 1.92 1.84 1.68 1.68 1.68
Weighted Average Units
Outstanding 26,791 21,467 6,540 2,045 2,045
BALANCE SHEET DATA:
Total Assets $ 1,046,532 $ 775,884 $ 633,885 $ 121,881 $ 126,917
Total Debt $ 454,820 $ 298,640 $ 248,433 $ 80,707 $ 80,808
Total Partners' Equity $ 540,221 $ 447,298 $ 349,695 $ 36,129 $ 40,220
Total Units Outstanding
at end of year (1) 28,303 24,384 20,478 2,045 2,045
OTHER DATA:
Funds From Operations (2) $ 66,764 $ 49,360 $ 13,615 $ 3,764 $ 2,420
Cash Flow Provided by (Used by):
Operating activities $ 78,637 51,856 14,363 5,453 2,451
Investing activities (289,569) (116,227) (315,025) (710) (845)
Financing activities 176,187 94,733 310,717 (4,952) (1,387)
</TABLE>
(1) All such information has been adjusted for the 1 for 4.2 reverse stock
split of the Predecessor Company effected prior to the completion of the
1993 Offering.
(2) Funds From Operations is defined by the National Association of Real Estate
Investment Trusts as net income or loss excluding gains or losses from
debt restructuring and sales of property plus depreciation and
amortization, and after adjustments for minority interest, unconsolidated
partnerships and joint ventures (adjustments for minority interests,
unconsolidated partnerships and joint ventures are calculated to reflect
Funds From Operations on the same basis). Funds From Operations does not
represent cash flow from operations as defined by generally accepted
accounting principles, should not be considered as an alternative to net
income as an indicator of the Partnership's operating performance, and is
not indicative of cash available to fund all cash flow needs.
- 12 -
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
OVERVIEW
The Partnership's operating results depend primarily upon income from the rental
operations of its industrial, office and retail properties located in its
primary markets. This income from rental operations is substantially influenced
by the supply and demand for the Partnership's rental space in its primary
markets.
In addition, the Partnership's continued growth is dependent upon its ability to
maintain occupancy rates and increase rental rates on its in-service portfolios
and to continue development and acquisition of additional rental properties. The
Partnership's primary markets in the Midwest have continued to offer strong and
stable local economies compared to other regions of the United States and have
provided attractive new development opportunities because of their central
location, established manufacturing base, skilled work force and moderate labor
costs. Consequently, the Partnership's overall occupancy rate of its in-service
portfolio has exceeded 93% the last two years and was at 95.4% at December 31,
1995. The Partnership expects to continue to maintain its overall occupancy
levels at comparable levels and also expects to be able to increase rental rates
as leases are renewed or new leases are executed. This stable occupancy as well
as increasing rental rates should improve the Partnership's results of
operations from its in-service properties. The Partnership's strategy for
continued growth also includes developing and acquiring additional rental
properties in its primary markets and expanding into other attractive Midwestern
markets.
The following table sets forth information regarding the Partnership's in-
service portfolio of rental properties as of December 31, 1995 and 1994 (in
thousands, except percentages):
<TABLE>
<CAPTION>
Total Percent of
Square Feet Total Square Feet Percent Occupied
----------------------- ---------------------- -----------------------
Type 1995 1994 1995 1994 1995 1994
------ -------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
INDUSTRIAL
Service Centers 2,802 2,051 14.0% 15.9% 94.7% 93.4%
Bulk 10,890 5,573 54.3% 43.2% 96.5% 97.5%
OFFICE
Suburban 3,874 3,090 19.3% 24.0% 94.7% 90.5%
CBD 699 699 3.5% 5.4% 92.3% 87.2%
Medical 332 198 1.6% 1.5% 90.3% 100.0%
RETAIL 1,476 1,285 7.3% 10.0% 93.8% 95.8%
-------- ------- ------- ------- ------- -------
Total 20,073 12,896 100.0% 100.0% 95.4% 94.5%
-------- ------- ------- ------- ------- -------
-------- ------- ------- ------- ------- -------
</TABLE>
-13-
<PAGE>
RESULTS OF OPERATIONS
Following is a summary of the Partnership's operating results and property
statistics for each of the years in the three-year period ended December 31,
1995 (in thousands, except number of properties and per Unit amounts):
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Rental Operations revenue $ 113,641 $ 89,299 $ 33,648
Service Operations revenue 17,777 18,473 5,654
Earnings from Rental Operations 36,662 26,580 5,483
Earnings from Service Operations 5,741 6,308 1,536
Operating income 40,526 30,743 6,282
Minority interest in earnings 911 1,088 293
Net income 41,600 32,968 6,670
Weighted average units outstanding 26,791 21,467 6,540
Net income per unit $ 1.55 $ 1.54 $ 1.02
Number of in-service properties at end of year 202 128 113
In-service square footage at end of year 20,073 12,896 10,850
Under development square footage at year end 3,448 2,362 1,270
</TABLE>
COMPARISON OF YEAR ENDED DECEMBER 31, 1995 TO YEAR ENDED DECEMBER 31, 1994
RENTAL OPERATIONS
The Partnership increased its in-service portfolio of rental properties from 128
properties comprising 12.9 million square feet at December 31, 1994 to 202
properties comprising 20.1 million square feet at December 31, 1995 through the
acquisition of 60 properties totaling 4.6 million square feet and the placement
in service of 17 properties and two building expansions totaling 3.2 million
square feet developed by the Partnership. The Partnership also disposed of
three properties totaling 570,000 square feet. These 74 net additional rental
properties primarily account for the $24.3 million increase in revenues from
Rental Operations from 1994 to 1995.
The increase from 1994 to 1995 in rental expenses, real estate taxes and
depreciation and amortization expense is also a result of the additional 74 in-
service rental properties.
Interest expense increased by approximately $2.6 million. This increase was
primarily because of interest expense on the $150 million of unsecured notes
which the Partnership issued in September 1995. These notes bear interest at an
effective rate of 7.46%. The proceeds from these notes were used to (i) retire
the outstanding balance of $35.0 million on the Partnership's line of credit;
(ii) retire $39.5 million of mortgage debt which had a weighted average interest
rate of 6.08% and was scheduled to reset at a market interest rate in the fourth
quarter of 1995; and (iii)fund development and acquisition of additional rental
properties during the fourth quarter of 1995.
As a result of the above-mentioned items, earnings from rental operations
increased $10.1 million from $26.6 million for the year ended December 31, 1994
to $36.7 million for the year ended December 31, 1995.
Management expects occupancy of the in-service property portfolio to remain
stable because (i) only 10.3% and 8.2% of the Partnership's occupied square
footage is subject to leases expiring in 1996 and 1997, respectively, and (ii)
the Partnership's renewal percentage averaged 65%, 73% and 65% in 1995, 1994 and
- 14 -
<PAGE>
1993, respectively. The following table reflects the Partnership's lease
expiration schedule as of December 31, 1995, including properties under
development, by product type indicating square footage and annualized net
effective rents under expiring leases (in thousands, except per square foot
amounts):
<TABLE>
<CAPTION>
Industrial Office Retail Total
----------------------- ---------------------- ----------------------- ---------------------
Year of Square Square Square Square
Expiration Feet Dollar Feet Dollar Feet Dollar Feet Dollar
- ----------- ----------- --------- ---------- -------- ----------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1996 1,825 $ 7,232 382 $ 3,662 83 $ 838 2,290 $ 11,732
1997 1,269 5,851 458 4,648 92 1,031 1,819 11,530
1998 2,262 8,466 549 5,631 109 1,165 2,920 15,262
1999 1,862 7,724 626 6,602 125 1,280 2,613 15,607
2000 1,849 7,238 441 5,454 124 1,442 2,414 14,134
2001 1,490 5,696 293 3,148 60 633 1,843 9,477
2002 265 1,115 595 6,333 88 792 948 8,240
2003 40 442 131 1,627 36 329 207 2,399
2004 810 3,128 89 1,043 13 136 912 4,306
2005 703 2,556 498 6,494 160 1,487 1,361 10,536
Thereafter 2,460 7,582 1,413 19,060 981 6,983 4,854 33,625
------ ------- ------ ------- ------ ------- ------- --------
Total Leased 14,835 $57,030 5,475 $63,702 1,871 $16,116 22,181 $136,848
------ ------- ------ ------- ------ ------- ------- -------
------ ------- ------ ------- ------ ------- ------- -------
Total Portfolio 15,672 5,841 2,008 23,521
------ ------ ------ -------
------ ------ ------ -------
Annualized net
effective rent
per square foot $ 3.84 $ 11.63 $ 8.61 $ 6.16
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
This stable occupancy, along with stable rental rates in each of the
Partnership's markets, will allow the in-service portfolio to continue to
provide a comparable or increasing level of earnings from rental operations. The
Partnership also expects to realize growth in earnings from rental operations
through (i) the placement in-service of the 3.4 million square feet of
properties under development at December 31, 1995 over the next seven quarters;
(ii) the development and acquisition of additional rental properties in its
primary markets; and (iii) the expansion into other attractive Midwestern
markets.
SERVICE OPERATIONS
Earnings from Service Operations decreased by approximately $600,000 in 1995 as
compared to 1994. This decrease results primarily from a decrease in
construction fees even though total construction volume remained consistent.
This decrease in fees resulted from certain contracts with above-market fees in
1994 which were not obtained in 1995. Property management, maintenance and
leasing fees remained consistent from 1994 to 1995. Payroll expense decreased
from 1994 to 1995 as a result of the allocation of a greater portion of these
costs to the Partnership's Rental Operations segment. Other operating expenses
did not change materially.
At December 31, 1995, the backlog of construction fees on signed construction
contracts was $3.9 million as compared to $1.7 million at December 31, 1994. As
a result of the acquisition by an unconsolidated subsidiary of the Partnership
of 2.2 million square feet of managed property, the Partnership anticipates a
slight decrease in management, leasing and maintenance fee revenues in 1996 as
well as a decrease in the operating expenses of the segment.
- 15 -
<PAGE>
OTHER INCOME (EXPENSE)
Interest income increased from $1.1 million for the year ended December 31, 1994
to $1.7 million for the year ended December 31, 1995 as a result of the
temporary short-term investment of excess proceeds from the 1995 Offering as
well as the 1995 Debt Offering.
As part of its October 1993 acquisition of Duke Associates, the Partnership
acquired an option to purchase an interest in an entity which provided
telecommunication services to tenants in properties owned and managed by the
Partnership. At the time the option was acquired, the option was not considered
to have value because of recurring net operating losses being incurred by such
entity. Subsequent to the acquisition of the option, the entity made changes in
its operations, principally entering into new contracts for the purchase of
telecommunication services and the provision of billing services, which
significantly improved its operating results. As a result of these improvements
in operating results, the entity entered into an agreement to sell its
telecommunications business to an unaffiliated third party at an amount
significantly in excess of the Partnership's option price. The net proceeds from
the sale were then loaned to the Partnership with a mortgage on certain
property. The Partnership subsequently exercised its option to acquire the
interest in this entity and recognized a gain of approximately $2.0 million
based on the difference between its option price and the net proceeds received
from the sale to the unaffiliated third-party. Such gain is included in earnings
from property sales in 1994.
NET INCOME
Net income for the year ended December 31, 1995 was $41.6 million compared to
net income of $33.0 million for the year ended December 31, 1994. This increase
results primarily from the operating result fluctuations in rental and service
operations explained above.
COMPARISON OF YEAR ENDED DECEMBER 31, 1994 TO YEAR ENDED DECEMBER 31, 1993
RENTAL OPERATIONS
As of December 31, 1992, the Predecessor Company owned 30 properties totaling
approximately 2.0 million square feet. In October 1993, the Partnership acquired
substantially all of the properties of Duke Associates, a full-service
commercial real estate firm operating primarily in the Midwest. In connection
with the acquisition, the Predecessor Company effected a 1 for 4.2 reverse stock
split relating to its existing shares and subsequently issued an additional
14,000,833 shares of Common Stock through an offering (the "1993 Offering").
Substantially all of the approximately $309.3 million of net proceeds of the
1993 Offering were contributed to the Partnership and were used to repay
property indebtedness of Duke Associates assumed by the Partnership as part
of the acquisition. The Predecessor Company also contributed their 30 owned
properties to the Partnership. The Partnership acquired 83 in-service
properties as part of this transaction. The operating results of the acquired
properties have been included in the Partnership's consolidated operating
results subsequent to the date of acquisition. As a result of the acquisition
in October 1993, the 1993 results of operations include nine months of
operations of the Predecessor Company's 30 original property portfolio and
three months of operations of the 113 property portfolio.
Also, during 1994, the Partnership developed and placed in service and acquired
a total of 15 properties to bring its total portfolio of in-service properties
to 128 as of December 31, 1994. A full year of operations for the 113 properties
as well as the addition of the 15 properties account for the increase in Rental
Operation revenues and operating expenses from 1993 to 1994.
- 16 -
<PAGE>
SERVICE OPERATIONS
The Partnership acquired its Service Operations as part of its acquisition of
Duke Associates in October 1993. Service Operation revenues and operating
expenses subsequent to the date of acquisition are included in the Partnership's
1993 operations. The increase in Service Operation revenue, operating expenses
and earnings from 1993 to 1994 results from the inclusion of a full year of such
operations in 1994.
GENERAL AND ADMINISTRATIVE
General and administrative expense increased from 1993 to 1994 primarily as a
result of the increase in the size of the Partnership through the acquisition of
Duke Associates' Rental and Service Operations and the placement in-service of
15 developed or acquired properties in 1994.
OTHER INCOME (EXPENSE)
Interest income increased from 1993 to 1994 primarily as a result of an increase
in temporary cash investments because of the increased size of the Partnership
as well as the temporary short-term investment of excess proceeds from the 1994
Offering.
Earnings from property sales increased from 1993 to 1994 primarily as a result
of the gain recognized on the exercise by the Partnership of an option to
acquire an interest in a telecommunications entity as discussed above under
Other Income (Expense) in the comparison of 1994 to 1995.
Minority interest in earnings of subsidiaries resulted from the acquisition of
Duke Associates in October 1993. The increase from 1993 to 1994 results from
allocation of a full year's income to the minority interests in 1994.
NET INCOME
Primarily as a result of the discussed above, net income increased from $6.7
million for the year ended December 31, 1993 to $33.0 million for the year ended
December 31, 1994.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities totaling $78.6 million, $51.9 million
and $14.4 million for the years ended December 31, 1995, 1994 and 1993,
respectively, represents the primary source of liquidity to fund distributions
to Unitholders and the minority interests and to fund recurring costs associated
with the renovation and re-letting of the Partnership's properties. The primary
reason for the increases in net cash provided by operating activities is, as
discussed above under "Results of Operations, the increase in net income each
year resulting from the expansion of the in-service portfolio through
development and acquisitions of additional rental properties.
Net cash used by investing activities totaling $289.6 million, $116.2 million
and $315.0 million for the years ended December 31, 1995, 1994 and 1993,
respectively, represents the investment of funds by the Partnership to expand
its portfolio of rental properties through the development and acquisition of
additional rental properties. Of the $315.0 million used in investing
activities in 1993, $302.1 million related to acquisition of the Duke
Associates' rental properties and service businesses. In 1994, $107.4 million
was
- 17 -
<PAGE>
invested in the development and acquisition of additional rental properties
and $12.4 million was used for tenant improvements, leasing costs and other
deferred assets. In 1995, the development and acquisition of additional
rental properties increased to $251.0 million with $24.1 million being used
for tenant improvements, costs and other deferred costs. In addition, in
1995, $16.7 million was invested in rental operations of a newly formed, 50%
owned, joint venture which also included the contribution of rental property
and undeveloped land with a carrying value of approximately $42.7 million.
Net cash provided by financing activities totaling $176.2 million, $94.7 million
and $310.7 million for the years ended December 31, 1995, 1994 and 1993,
respectively, is comprised of debt and equity issuances net of distributions to
unitholders and repayments of outstanding indebtedness. In 1993, the
Partnership received $309.2 million from the 1993 Offering which was used
primarily for the acquisition of Duke Associates. In 1994, the Partnership
received $92.1 million from the 1994 Offering and $60.0 million from a seven-
year mortgage loan. Of the $152.1 million of these proceeds, the Partnership
used $60.0 million to repay the balance outstanding on the line of credit, $6.0
million to retire outstanding mortgage indebtedness, and the remainder
primarily to fund development and acquisition of additional rental properties.
In 1995, the Partnership received $96.3 million from the 1995 Offering and
used $11.0 million to repay the balance outstanding on the line of credit
and the remainder to fund development and acquisition of additional
rental properties. The Partnership also received $150.0 million from the 1995
Debt Offering and used $39.5 million to retire outstanding mortgage
indebtedness, $35.0 million to repay the balance outstanding on the line of
credit, and the remainder to fund acquisition and development of additional
rental properties.
The recurring capital needs of the Partnership are funded primarily through the
undistributed net cash provided by operating activities. Following is an
analysis of the Partnership's recurring capital expenditures (in thousands):
<TABLE>
<CAPTION>
1995 1994 1993
--------- --------- ---------
<S> <C> <C> <C>
Tenant improvements $ 4,312 $ 3,056 $ 2,015
Leasing costs 3,519 2,407 636
Building improvements 757 474 136
--------- --------- ---------
Total $ 8,588 $ 5,937 $ 2,787
--------- --------- ---------
--------- --------- ---------
</TABLE>
In March 1994, the Partnership obtained a $60 million secured credit facility
which was available to fund development and acquisition of additional rental
properties and to provide working capital as needed. In April 1995, the
Partnership replaced the secured line of credit with a $100 million unsecured
line of credit which matures in April 1998. Borrowings of $45 million under this
line of credit as of December 31, 1995 bear interest at one month LIBOR plus
2.00%, which ranged from 7.7500% to 7.9375%. In January 1996, the Partnership
increased the unsecured line of credit to $150 million and reduced the borrowing
rate to LIBOR plus 1.625%. The current effective interest rate on the line of
credit based on the 30-day LIBOR rate as of March 4, 1996 is 6.94%.
The General Partner and the Partnership currently have on file two Form S-3
Registration Statements with the Securities and Exchange Commission (the "Shelf
Registrations") which have remaining availability as of December 31, 1995 of
approximately $330 million to issue additional common stock, preferred stock or
unsecured debt securities. The General Partner and the Partnership intend to
issue additional securities under such Shelf Registrations to fund the
development and acquisition of additional rental properties.
- 18 -
<PAGE>
The total debt outstanding at December 31, 1995 consists of notes totaling
$454.8 million with a weighted average interest rate of 7.50% maturing at
various dates through 2018. Scheduled principal amortization of such debt
totaled $1.65 million for the year ended December 31, 1995. Following is a
summary of the scheduled future amortization and maturities of the Partnership's
indebtedness:
<TABLE>
<CAPTION>
Weighted Average
Interest Rate of
Year Repayments Future Repayments
---- -------------------------------------------------- -------------------
(in thousands)
Scheduled
Amortization Maturities Total
------------ ---------- ------
<S> <C> <C> <C> <C>
1996 $ 1,855 $ 59,619 $ 61,474 5.31%
1997 2,156 - 2,156 8.04%
1998 2,410 90,216 92,626 7.49%
1999 2,625 - 2,625 8.25%
2000 2,637 4,852 7,489 7.86%
2001 2,291 59,954 62,245 8.72%
2002 2,494 50,000 52,494 7.37%
2003 252 68,813 69,065 8.48%
2004 274 - 274 5.20%
2005 300 100,000 100,300 7.51%
Thereafter 4,072 - 4,072 5.20%
--------- -------- --------
Total $ 21,366 $433,454 $454,820
--------- -------- --------
--------- -------- --------
</TABLE>
The 1996 maturities of $59.6 million indicated above occur in October through
December. The Partnership currently intends to repay this debt through the use
of the net proceeds from the issuance of either common or preferred equity by
the General Partner or unsecured debt securities by the Partnership available
under the Shelf Registrations. The Partnership estimates that if unsecured
debt securities are issued, based on current market interest rates, the rate on
such debt would increase by approximately 1.6%. Of the 1998 maturities, $45.0
million represents the outstanding balance as of December 31, 1995 on the
Partnership's line of credit.
The Partnership intends to pay regular quarterly distributions from net cash
provided by operating activities. A quarterly distribution of $.49 per Unit was
declared on February 1, 1996 which represents an annualized distribution of
$1.96 per Unit.
FUNDS FROM OPERATIONS
Management believes that Funds From Operations ("FFO"), which is defined by the
National Association of Real Estate Investment Trusts as net income or loss
excluding gains or losses from debt restructuring and sales of property plus
depreciation and amortization, and after adjustments for minority interest,
unconsolidated partnerships and joint ventures (adjustments for minority
interest, unconsolidated partnerships and joint ventures are calculated to
reflect FFO on the same basis), is the industry standard for reporting the
operations of real estate investment trusts.
- 19 -
<PAGE>
The following table reflects the calculation of the Partnership's FFO for the
years ended December 31, as follows (in thousands):
<TABLE>
<CAPTION>
1995 1994 1993
-------- -------- -------
Net income $ 41,600 $ 32,968 $ 6,670
Add back:
Depreciation and amortization 23,118 16,785 7,075
Amortization of deferred financing costs and
depreciation of non-rental real estate assets 1,918 1,453 327
Share of joint venture depreciation and amortization 411 352 60
Gain on property sales (283) (2,198) (517)
-------- -------- -------
FUNDS FROM OPERATIONS $ 66,764 $ 49,360 $ 13,615
-------- -------- -------
-------- -------- -------
CASH FLOW PROVIDED BY (USED BY):
Operating activities $ 78,637 $ 51,856 $ 14,363
Investing activities (289,569) (116,227) (315,025)
Financing activities 176,187 94,733 310,717
The increase in FFO for the three year period results primarily from the
increased in-service rental property portfolio as discussed above under
"Results of Operations." The following table indicates components of
such growth for each of the years ended December 31, as follows
(in thousands):
1995 1994 1993
-------- -------- -------
<S> <C> <C> <C>
Rental operations:
Original portfolio $ 59,399 $ 58,201 $ 23,300
Development 10,668 2,240 -
Acquisitions 12,014 2,463 -
Investments in unconsolidated companies 1,121 1,407 357
Interest expense (21,462) (18,920) (10,334)
-------- -------- -------
Net rental operations 61,740 45,391 13,323
Service operations, net of minority interest 4,767 5,389 1,277
Other, net 257 (1,420) (985)
-------- -------- -------
FUNDS FROM OPERATIONS $ 66,764 $ 49,360 $ 13,615
-------- -------- --------
-------- -------- -------
</TABLE>
In March 1995, NAREIT issued a clarification of its definition of FFO effective
for years beginning after December 31, 1995. The clarification provides that
amortization of deferred financing costs and depreciation of non-rental real
estate assets are no longer to be added back to net income in arriving at FFO.
The Partnership's FFO under the new method of calculation would have been $64.9
million, $47.9 million, and $13.3 million for the three years ended December 31,
1995, 1994, and 1993, respectively.
While management believes that FFO is a relevant measure of the Partnership's
operating performance because it is widely used by industry analysts to
measure the operating performance of equity REITs and real estate partnerships,
such amount does not represent cash flow from operations as defined by generally
accepted accounting principles, should not be considered as an alternative to
net income as an indicator of the Partnership's operating performance, and is
not indicative of cash available to fund all cash flow needs.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements and supplementary data are included under Item 14 of
this Report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
- 20 -
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Partnership does not have any directors or officers. The information
required by this Item for Directors and certain Executive Officers of the
General Partner will be contained in a definitive proxy statement of Duke
Realty Investments, Inc. which the Registrant anticipates will be filed no
later than April 29, 1996, which proxy statement is incorporated herein by
reference, and thus this part has been omitted in accordance with General
Instruction G(3) to Form 10-K.
The following information is provided regarding the executive officers of the
General Partner who do not serve as Directors of the General Partner:
GARY A. BURK
Age 44, President of Construction Services and Executive Vice President of
Duke Services, Inc. - Mr. Burk joined the Partnership in 1979, and has been
responsible for the Partnership's construction management operations since 1986.
ROSS C. FARRO
Age 52, Vice President, Cleveland Group - Mr. Farro joined the Partnership
in January 1996 and is responsible for the Cleveland activities of the
Partnership. Prior to joining the Partnership, Mr. Farro was an independent
real estate developer and operator.
ROBERT D. FESSLER
Age 38, Vice President, Ohio Industrial Group - Mr. Fessler joined the
Partnership in 1987 and is responsible for the Cincinnati industrial activities
of the Partnership. Prior to joining the Partnership, Mr. Fessler was a leasing
representative with Trammel Crow.
JOHN R. GASKIN
Age 34, Vice President, General Counsel and Secretary - Mr. Gaskin joined the
Partnership in 1990. Prior to joining the Partnership, Mr. Gaskin worked as an
associate attorney in a mid-size Indianapolis, Indiana law firm.
RICHARD W. HORN
Age 38, Vice President of Acquisitions - Mr. Horn joined the Partnership in
1984. Mr. Horn is responsible for the acquisition activities of the Partnership
and also oversees the Nashville and Michigan operations of the Partnership.
DONALD J. HUNTER
Age 36, Vice President, Columbus Group - Mr. Hunter joined the Partnership in
1989 and is responsible for the Columbus activities of the Partnership. Prior
to joining the Partnership, Mr. Hunter was with Cushman and Wakefield, a
national real estate firm.
- 21 -
<PAGE>
STEVEN R. KENNEDY
Age 39, Vice President of Construction Services - Mr. Kennedy joined the
Partnership in 1986. Prior to that time, Mr. Kennedy was a Project Manager for
Charles Pankow Builders, Inc.
WAYNE H. LINGAFELTER
Age 36, Vice President, Indiana Office Group - Mr. Lingafelter joined the
Partnership in 1987 and is responsible for the Indiana office activities of the
Partnership. Prior to that time, Mr. Lingafelter was with the management
consulting firm of DRI, Inc.
WILLIAM E. LINVILLE, III
Age 41, Vice President, Indiana Industrial Group - Mr. Linville joined the
Partnership in 1987 and is responsible for the Indianapolis industrial
activities of the Partnership. Prior to that time, Mr. Linville was Vice
President and Regional Manager of the CB Commercial Brokerage Office in
Indianapolis.
DAVID R. MENNEL
Age 41, General Manager of Services Operations and President of Duke
Services, Inc.- Mr. Mennel was with the accounting firm of Peat, Marwick,
Mitchell & Co. and the property development firm of Melvin Simon & Associates
before joining the Partnership in 1978.
DAVID P. MINTON
Age 38, Vice President, St. Louis Group - Mr. Minton joined the Partnership in
1995 and is responsible for the St. Louis activities of the Partnership. Prior
to joining the Partnership, Mr. Minton was Vice President of the Paragon Group,
a national real estate development and management firm.
MICHAEL L. MYRVOLD
Age 40, Vice President, Retail Group - Mr. Myrvold joined the Partnership in
1995 and is responsible for retail activities of the Partnership. Prior to
joining the Partnership, Mr. Myrvold was Vice President of Real Estate of the
Melville Realty Co., Inc.
JOHN M. NEMECEK
Age 40, President of Asset and Property Management - Mr. Nemecek joined the
Partnership in 1994. Prior to joining the Partnership, Mr. Nemecek was the
Senior Vice President/Florida Division of Compass Real Estate.
DENNIS D. OKLAK
Age 42, Vice President and Treasurer - Mr. Oklak joined the Partnership in 1986
and has served as Tax Manager and Controller of Development. Prior to joining
the Partnership, Mr. Oklak was a Senior Manager with the public accounting firm
of Deloitte Haskins + Sells.
JEFFREY G. TULLOCH
Age 50, Vice President and General Manager, Cincinnati Group - Mr. Tulloch
joined the Partnership in 1995 and is responsible for allCincinnati activities
of the Partnership. Mr. Tulloch was Senior Vice President of the Galbreath
Partnership before joining the Partnership.
- 22 -
<PAGE>
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
officers and directors of the General Partner, and persons who own more than 10%
of the Limited Partner Units, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission. Such officers, directors
and greater than 10% Unitholders are required by Securities and Exchange
Commission regulations to furnish the Partnership with copies of all Section
16(a) forms they file. To date, there have been no delinquencies in filing such
reports.
ITEM 11, 12, 13 EXECUTIVE COMPENSATION, SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT AND CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS.
The information required by Item 11, Item 12 and Item 13 with respect to
officers and directors of the General Partner will be contained in a definitive
proxy statement for Duke Realty Investments, Inc. which the Registrant
anticipates will be filed no later than April 29, 1996, which proxy statement is
incorporated herein by reference, and thus this part has been omitted in
accordance with General Instruction G(3) to Form 10-K. The only person known by
the Partnership as of February 12, 1996 who beneficially owned more than five
percent of the outstanding Limited Partner Units whose ownership will not be
reflected in the proxy statement of Duke Realty Investments, Inc. was Allied
Domecq Pension Fund who beneficially owned 605,620 Limited Partner Units
through affiliates of Wyndham Investments Limited, a property holding company.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) DOCUMENTS FILED AS PART OF THIS REPORT.
1. CONSOLIDATED FINANCIAL STATEMENTS:
INDEX
Independent Auditors' Report
Consolidated Balance Sheets, December 31, 1995 and 1994
Consolidated Statements of Operations, Years Ended December 31, 1995, 1994
and 1993 Consolidated Statements of Cash Flows, Years Ended December 31,
1995, 1994 and 1993
Consolidated Statements of Partners' Equity, Years Ended December 31, 1995,
1994 and 1993
Notes to Consolidated Financial Statements
Duke Associates Combined Statements of Operations and Cash Flows
for the Nine Months Ended September 30, 1993 (Unaudited)
2. CONSOLIDATED FINANCIAL STATEMENT SCHEDULES
INDEX
Schedule III - Real Estate and Accumulated Depreciation
EDGAR FINANCIAL DATA SCHEDULE
Exhibit 27 - Financial Data Schedule for year ended December 31, 1995
(EDGAR filing only)
Other schedules are omitted for the reasons that they are not required, are
not applicable, or the required information is set forth in the financial
statements or notes thereto.
- 23 -
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Partners
Duke Realty Limited Partnership:
We have audited the consolidated financial statements of Duke Realty Limited
Partnership and Subsidiaries as listed in the accompanying index. In connection
with our audits of the consolidated financial statements, we also have audited
the financial statement schedule as listed in the accompanying index. These
consolidated financial statements and the financial statement schedule are the
responsibility of the Partnership's management. Our responsibility is to express
an opinion on the consolidated financial statements and the financial statement
schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Duke Realty Limited
Partnership and Subsidiaries as of December 31, 1995 and 1994 and the results of
their operations and their cash flows for each of the years in the three-year
period ended December 31, 1995 in conformity with generally accepted accounting
principles. Also, in our opinion, the related financial statement schedule,
when considered in relation to the basic consolidated financial statements taken
as a whole, presents fairly, in all material respects, the information set forth
therein.
KPMG PEAT MARWICK LLP
Indianapolis, Indiana
January 31, 1996
- 24 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
December 31,
------------------------------
1995 1994
---------- ----------
ASSETS
<S> <C> <C>
Real estate investments (Note 5):
Land and improvements $ 91,550 $ 72,758
Buildings and tenant improvements 712,614 580,794
Construction in progress 96,698 22,967
Land held for development 62,637 47,194
---------- ----------
963,499 723,713
Accumulated depreciation (56,335) (38,058)
---------- ----------
Net real estate investments 907,164 685,655
Cash and cash equivalents 5,682 40,427
Accounts receivable from tenants, net of allowance of $624 and $450 5,184 4,257
Accrued straight-line rents, net of allowance of $841 8,101 5,030
Receivables on construction contracts 9,462 7,478
Investments in unconsolidated companies (Note 4) 67,771 8,418
Deferred financing costs, net of accumulated amortization of $2,072 and $1,755 8,141 6,390
Deferred leasing and other costs, net of accumulated amortization
of $4,959 and $2,702 20,609 11,845
Escrow deposits and other assets 14,418 6,384
---------- ----------
$1,046,532 $ 775,884
---------- ----------
---------- ----------
LIABILITIES AND PARTNERS' EQUITY
Indebtedness (Note 5):
Mortgage debt $ 259,820 $ 298,640
Unsecured notes 150,000 -
Line of credit 45,000 -
---------- ----------
454,820 298,640
Construction payables and amounts due subcontractors 21,410 9,464
Accounts payable 1,132 869
Accrued real estate taxes 10,374 8,983
Accrued interest 3,461 314
Other accrued expenses 5,454 2,860
Other liabilities 5,490 3,564
Tenant security deposits and prepaid rents 3,872 3,472
---------- ----------
Total liabilities 506,013 328,166
---------- ----------
Minority interest 298 420
---------- ----------
Partners' equity:
General partner 535,783 446,383
Limited partner 4,438 915
---------- ----------
Total partners' equity 540,221 447,298
---------- ----------
$1,046,532 $ 775,884
---------- ----------
---------- ----------
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
- 25 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)
<TABLE>
<CAPTION>
Year ended December 31,
--------------------------------------
1995 1994 1993
--------- -------- --------
<S> <C> <C> <C>
RENTAL OPERATIONS:
Revenues:
Rental income (Note 7) $112,931 $88,243 $33,351
Equity in earnings of unconsolidated companies (Note 4) 710 1,056 297
--------- -------- --------
113,641 89,299 33,648
--------- -------- --------
Operating expenses:
Rental expenses 21,497 17,507 7,059
Real estate taxes 9,683 8,256 3,403
Interest expense (Note 5) 21,462 18,920 10,334
Depreciation and amortization 24,337 18,036 7,369
--------- -------- --------
76,979 62,719 28,165
--------- -------- --------
Earnings from rental operations 36,662 26,580 5,483
--------- -------- --------
SERVICE OPERATIONS:
Revenues:
Property management, maintenance and leasing fees 11,138 11,084 3,000
Construction management and development fees 5,582 6,107 2,501
Other income 1,057 1,282 153
--------- -------- --------
17,777 18,473 5,654
--------- -------- --------
Operating expenses:
Payroll 8,241 8,723 2,688
Maintenance 1,344 1,069 473
Office and other 2,451 2,373 957
--------- -------- --------
12,036 12,165 4,118
--------- -------- --------
Earnings from service operations 5,741 6,308 1,536
--------- -------- --------
General and administrative expenses (1,877) (2,145) (737)
--------- -------- --------
Operating income 40,526 30,743 6,282
OTHER INCOME (EXPENSE):
Interest income 1,702 1,115 164
Earnings from property sales 283 2,198 517
Minority interest in earnings of subsidiaries (911) (1,088) (293)
--------- -------- --------
Net income $ 41,600 $ 32,968 $ 6,670
--------- -------- --------
--------- -------- --------
Net income per Unit $ 1.55 $ 1.54 $ 1.02
--------- -------- --------
--------- -------- --------
Weighted average number of Units outstanding 26,791 21,467 6,540
--------- -------- --------
--------- -------- --------
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
- 26 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
Year ended December 31,
----------------------------------------------
1995 1994 1993
--------- -------- --------
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $41,600 $ 32,968 $ 6,670
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation of buildings and tenant improvements 20,416 15,068 6,459
Amortization of deferred financing costs 1,218 1,251 294
Amortization of deferred leasing and other costs 2,703 1,717 616
Minority interest in earnings of subsidiaries 911 1,088 293
Straight-line rent adjustment (3,198) (2,307) (570)
Allowance for straight-line rent receivable - 748 93
Earnings from property sales, net (283) (2,198) (517)
Construction contracts, net 8,722 2,405 (919)
Other accrued revenues and expenses, net 6,737 1,335 2,075
Equity in earnings of unconsolidated companies (189) (219) (131)
-------- --------- --------
NET CASH PROVIDED BY OPERATING ACTIVITIES 78,637 51,856 14,363
-------- --------- --------
Cash flows from investing activities:
Proceeds from property sales, net 5,281 3,337 1,306
Rental property development costs (128,879) (55,819) (7,168)
Rental property recurring building improvements (757) (474) (136)
Acquisition of rental properties (57,427) (44,201) -
Acquisition of undeveloped land (38,361) (6,924) -
Acquisition of businesses (25,620) - (302,070)
Recurring tenant improvements (4,312) (3,056) (2,015)
Recurring leasing costs (3,519) (2,407) (636)
Other deferred costs and other assets (16,225) (6,960) (4,106)
Net investment in and advances to unconsolidated companies (19,750) 277 (200)
-------- --------- --------
NET CASH USED BY INVESTING ACTIVITIES (289,569) (116,227) (315,025)
-------- --------- --------
Cash flows from financing activities:
Contributions from partners 96,302 92,145 309,334
Proceeds from indebtedness 195,051 61,504 88,945
Payments on indebtedness (60,030) (16,149) (78,496)
Distributions to partners (50,807) (39,514) (3,438)
Distributions to minority interest (1,032) (1,191) -
Deferred financing costs (3,297) (2,062) (5,628)
-------- --------- --------
NET CASH PROVIDED BY FINANCING ACTIVITIES 176,187 94,733 310,717
-------- --------- --------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (34,745) 30,362 10,055
Cash and cash equivalents at beginning of year 40,427 10,065 10
-------- --------- --------
Cash and cash equivalents at end of year $ 5,682 $ 40,427 $ 10,065
-------- --------- --------
-------- --------- --------
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
- 27 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY
(IN THOUSANDS, EXCEPT FOR PER UNIT AMOUNTS)
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
------- -------- -----
<S> <C> <C> <C>
BALANCE AT DECEMBER 31, 1992 $ 36,129 $ - $ 36,129
Capital contribution from Duke Realty Investments, Inc. 310,334 - 310,334
Net income 5,013 1,657 6,670
Distributions to partners ($1.68 per Unit) (3,438) - (3,438)
---------- ------- ----------
BALANCE AT DECEMBER 31, 1993 348,038 1,657 349,695
Net income 26,216 6,752 32,968
Capital contribution from Duke Realty Investments, Inc. 92,171 - 92,171
Acquisition of partnership interest for Common Stock of
Duke Realty Investments, Inc. 11,523 - 11,523
Acquisition of property in exchange for Limited Partner Units - 455 455
Distributions to partners ($1.84 per Unit) (31,565) (7,949) (39,514)
---------- ------- ----------
BALANCE AT DECEMBER 31, 1994 446,383 915 447,298
Net income 35,070 6,530 41,600
Capital contribution from Duke Realty Investments, Inc. 96,433 - 96,433
Acquisition of partnership interest for Common Stock of
Duke Realty Investments, Inc. 796 - 796
Acquisition of property in exchange for Limited Partner Units - 4,901 4,901
Distributions to partners ($1.92 per Unit) (42,899) (7,908) (50,807)
---------- ------- ----------
BALANCE AT DECEMBER 31, 1995 $ 535,783 $ 4,438 $ 540,221
---------- ------- ----------
---------- ------- ----------
UNITS OUTSTANDING AT DECEMBER 31, 1995 24,152 4,151 28,303
---------- ------- ----------
---------- ------- ----------
UNITS OUTSTANDING AT DECEMBER 31, 1994 20,391 3,993 24,384
---------- ------- ----------
---------- ------- ----------
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
-28-
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(1) THE PARTNERSHIP
Duke Realty Limited Partnership (the "Partnership") was formed on October 4,
1993, when Duke Realty Investments, Inc. (the "Predecessor Company" or the
"General Partner") contributed all of its properties and related assets and
liabilities along with the net proceeds of $309.2 million from the issuance of
an additional 14,000,833 shares through an offering (the "1993 Offering") to the
Partnership. Simultaneously, the Partnership completed the acquisition of Duke
Associates, a full-service commercial real estate firm operating in the Midwest.
The General Partner was formed in 1985 and qualifies as a real estate investment
trust under provisions of the Internal Revenue Code. In connection with the 1993
Offering, the formation of the Partnership and the acquisition of Duke
Associates, the General Partner effected a 1 for 4.2 reverse stock split of its
existing common shares. The General Partner is the sole general partner of the
Partnership and received 16,046,144 units of partnership interest in exchange
for its original contribution which represented a 78.36% interest in the
Partnership. As part of the acquisition, Duke Associates received 4,432,109
units of limited partnership interest ("Limited Partner Units" (together with
the units of general partner interests, the ("Units")) which represented a
21.64% interest in the Partnership. The Limited Partner Units are exchangeable
for shares of the General Partner's common stock on a one-for-one basis subject
generally to a one-year holding period.
The acquisition of Duke Associates was accounted for under the purchase method.
The value of $466.0 million assigned to the acquired properties and businesses
was equal to the property debt and other net liabilities assumed, of which
$302.1 million was repaid with the proceeds of the Predecessor Company's
contribution. The operating results of the acquired properties and businesses
have been included in the consolidated operating results subsequent to the date
of acquisition.
The Partnership owns and operates a portfolio of industrial, office and retail
properties in the Midwest and provides real estate services to third-party
property owners. The Partnership's primary markets are Indianapolis, Indiana;
Cincinnati and Columbus, Ohio; Detroit, Michigan; St. Louis, Missouri and
Nashville, Tennessee.
The service operations are conducted through Duke Realty Services
Limited Partnership ("DRSLP") and Duke Construction Limited Partnership
("DCLP"), in which the Partnership has an 89% profits interest (after certain
preferred returns on partners' capital accounts) and effective control of their
operations. The consolidated financial statements include the accounts of the
Partnership and its majority-owned or controlled subsidiaries. The equity
interests in these majority-owned or controlled subsidiaries not owned by the
Partnership are reflected as minority interests in the consolidated financial
statements.
-29-
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
In 1994, the General Partner issued an additional 3,887,300 shares of Common
Stock through an additional offering ("1994 Offering") and received net proceeds
of approximately $92.1 million. These proceeds were contributed to the
Partnership in exchange for additional Units and were used by the Partnership to
fund development and acquisition costs of additional rental properties.
In 1995, the General Partner issued an additional 3,727,500 shares of Common
Stock through another offering ("1995 Offering") and received net proceeds of
approximately $96.3 million. The proceeds of the 1995 Offering were contributed
to the Partnership in exchange for additional Units and were used by the
Partnership to fund development and acquisition of additional rental properties.
On September 22, 1995, the Partnership issued $150 million of unsecured notes
through a debt offering ("Debt Offering"). A portion of the proceeds of the Debt
Offering was used to reduce amounts outstanding on its unsecured credit facility
and other mortgage debt and to fund current development and acquisition of
additional rental properties.
In 1995 and 1994, as a result of partners exchanging their Limited Partner
Units for shares of Common Stock of the General Partner pursuant to the
Partnership Agreement, the General Partner acquired an additional interest in
the Partnership through the issuance of 27,760 and 456,375 shares of Common
Stock, respectively. The acquired additional interest was accounted for using
the purchase method with the assets acquired recorded at the fair market value
of the General Partners' Common Stock on the date of acquisition. The
acquisition amounts of $796,000 and $11.5 million in 1995 and 1994,
respectively, were allocated to rental property, undeveloped land and
investments in unconsolidated companies based on their estimated fair values.
The General Partner owns an 85.3% interest in the Partnership at
December 31, 1995.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the
Predecessor Company for the period from December 31, 1992 to October 4,
1993 and the accounts and operations of the Partnership and its majority-
owned or controlled subsidiaries for the period from October 4, 1993 (date
of formation) to December 31, 1993, and for the years ended December 31,
1995 and 1994. The equity interests in these majority-owned or controlled
subsidiaries not owned by the Partnership are reflected as minority
interests in the consolidated financial statements. All significant
intercompany balances and transactions have been eliminated in the
consolidated financial statements.
SEGMENT OPERATIONS
The Partnership is engaged in two business segments, the ownership and
rental of real estate investments ("Rental Operations") and the providing
of various real estate services such as property management, maintenance,
leasing and construction management to third-party property owners
- 30 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
("Service Operations"). There are no intersegment sales or transfers
between Rental Operations and Service Operations. The identifiable
assets of the Service Operations consisting of cash, accounts receivable,
construction receivables and other assets as of December 31, 1995 and 1994
were $15.8 million and $13.2 million, respectively. Capital expenditures
related to Service Operations were $1.5 million, $761,000 and $134,000 for
the years ended December 31, 1995, 1994, and 1993, respectively. All
remaining assets, capital expenditures, depreciation, amortization and
investments in and advances to unconsolidated companies relate to Rental
Operations. The operations of each segment are reflected separately on
the Statement of Operations.
REAL ESTATE INVESTMENTS
Real estate investments are stated at the lower of cost less accumulated
depreciation or fair value if impairment is identified. Buildings and
land improvements are depreciated on the straight-line method over
40 years, and tenant improvement costs are depreciated on the straight-line
method over the term of the related lease.
Project costs, including interest and real estate taxes incurred in
connection with construction or expansion of real estate investments, are
capitalized as a cost of the property and depreciated over the estimated
useful life of the related asset.
The Partnership has adopted STATEMENT OF FINANCIAL ACCOUNTING STANDARDS
NO. 121, ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS AND FOR
LONG-LIVED ASSETS TO BE DISPOSED OF, with no impact on the financial
statements. The Partnership evaluates its real estate investments upon
occurrence of significant changes in the operations, but not less than
annually, to assess whether any impairment indications are present,
including recurring operating losses and significant adverse changes in
legal factors or business climate that affect the recovery of the recorded
value. If any real estate investment is considered impaired, a loss is
provided to reduce the carrying value of the property to its estimated
fair value.
INVESTMENTS IN UNCONSOLIDATED COMPANIES
The equity method of accounting is used for investments in non-majority
owned partnerships and joint ventures in which the Partnership has the
ability to exercise significant influence over operating and financial
policies. Any difference between the carrying amount of these investments
and the underlying equity in net assets is amortized to equity in earnings
of unconsolidated companies over 40 years. The cost method of accounting is
used for non-majority owned joint ventures over which the Partnership does
not have the ability to exercise significant influence. The difference
between the cost method and the equity method for such ventures does not
significantly affect the financial position or results of operations of the
Partnership.
CASH EQUIVALENTS
Highly liquid investments with a maturity of three months or less when
purchased are classified as cash equivalents.
DEFERRED COSTS
Costs incurred in connection with financing or leasing are amortized on the
straight-line method over the term of the related loan or lease.
Unamortized costs are charged to expense upon the early termination of the
lease or upon early payment of the financing.
-31-
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
Prepaid interest is amortized to interest expense using the effective
interest method over the terms of the related loans.
REVENUES
RENTAL OPERATIONS
Rental income from leases with scheduled rental increases during their
terms is recognized for financial reporting purposes on a straight-line
basis.
SERVICE OPERATIONS
Management fees are based on a percentage of rental receipts of properties
managed and are recognized as the rental receipts are collected.
Maintenance fees are based upon established hourly rates and are recognized
as the services are performed. Leasing fees are based on a percentage of
the total rental due under completed leases and are generally recognized
upon lease execution. Construction management and development fees are
generally based on a percentage of costs and are recognized as the
project costs are incurred. Other income consists primarily of payroll
reimbursements for on-site property management services.
STOCK BASED COMPENSATION
The Partnership and the General Partner grant stock options for a fixed
number of shares of the General Partner's Common Stock to employees with an
exercise price equal to the fair value of the shares at the date of grant.
The Partnership accounts for stock option grants in accordance with APB
Opinion No. 25, ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES, and, accordingly,
recognizes no compensation expense for the stock option grants.
PROJECT COSTS
All direct and indirect costs clearly associated with the acquisition,
development, construction and rental of real estate projects owned by the
Partnership are capitalized. Capitalized costs associated with
acquisition, development and construction of properties are included in
real estate investments and costs associated with the rental of properties
are included in deferred costs.
NET INCOME PER UNIT
Net income per Unit is calculated using the weighted average number of
Units outstanding during the year. Unit equivalents that in the aggregate
dilute net income per Unit by less than 3% are not considered in computing
weighted average Units outstanding.
-32-
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
FEDERAL INCOME TAXES
As a partnership, the allocated share of income or loss for the year is
included in the income tax returns of the partners; accordingly, no
accounting for income taxes is required in the accompanying consolidated
financial statements.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair values of the Partnership's financial instruments, including
accounts receivable, accounts payable, accrued expenses, mortgage debt,
unsecured notes payable, line of credit and other financial instruments,
generally determined using the present value of estimated future cash flows
using a discount rate commensurate with the risks involved, approximate
their carrying or contract values.
USE OF ESTIMATES
The preparation of the consolidated financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the amounts reported in the
consolidated financial statements and accompanying notes. Actual results
could differ from those estimates.
(3) RELATED PARTY TRANSACTIONS
The Partnership provides management, leasing, construction and other tenant
related services to partnerships in which certain executive officers of the
General Partner have continuing ownership interests. The Partnership was
paid fees totaling $1,942,000, $2,271,000 and $885,000 for such services in
1995, 1994 and 1993, respectively. Management believes the terms for such
services are equivalent to those available in the market. The Partnership
has an option to purchase the executive officers' interest in each of these
properties which expires October 2003. The option price of each property
was established at the date the option was granted.
(4) INVESTMENTS IN UNCONSOLIDATED COMPANIES
The Partnership has equity interests ranging from 10% to 50% in
unconsolidated partnerships and joint ventures which own and operate rental
properties and hold land for development in the Midwest. In 1995, the
Partnership acquired its unaffiliated partner's 50% interest in a joint
venture which owned two suburban office rental properties (one of which was
under construction as of December 31, 1995) and 40.3 acres of land held for
development. The Partnership accounted for the acquisition of the 50%
interest using the purchase method with its recorded investment in the
properties equal to the sum of the balance of its investment in and
advances to the joint venture at the date of acquisition, the net
liabilities assumed and cash paid to the joint venture partner amounting
to $24.4 million. In 1994, the Partnership acquired its unaffiliated
partner's 55% interest in a partnership which owned a suburban office
rental property.
-33-
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
The Partnership accounted for the acquisition of the 55% interest using the
purchase method with its recorded investment in the property equal to the
sum of its investment in the partnership at the date of acquisition, the
cash payment to the unaffiliated partner, cash repayment of a portion of
the partnership's mortgage loan and net liabilities assumed, including the
remaining balance on the partnership's mortgage loan of $4.5 million. The
fair value of the property exceeds the Company's recorded investment. Also
in 1994, a partnership in which the Partnership owned a 50% interest was
dissolved through the distribution of all assets and liabilities to the
partners. At the date of dissolution, the Partnership had loans and
advances to the partnership totaling $4.2 million. Under terms of the
dissolution agreement, the Partnership received 71 acres of land held for
development and the partnership was not required to repay the Partnership's
loans and advances. The Partnership's recorded investment in the property
received is equal to the sum of its investment in and loans and advances to
the partnership at the date of dissolution. The fair value of the
property exceeds the Company's recorded investment.
On December 28, 1995, the Partnership formed a joint venture (Dugan Realty
L.L.C.) with an institutional real estate investor and purchased 25
industrial buildings totaling approximately 2.3 million square feet.
Upon formation of the venture, the Partnership contributed approximately
1.4 million square feet of recently developed and acquired industrial
properties, 113 acres of recently acquired land held for future
development, and approximately $16.7 million of cash for a 50.1%
interest in the joint venture. The Partnership's recorded investment at
December 31, 1995 in the joint venture of $59.4 million is the sum of
the carrying value of the properties, land, and cash contributed. Upon
completion of 1.1 million square feet of property currently under
development at an agreed value of $50.8 million, the Partnership will
contribute these properties to the joint venture and receive a $12.5
million cash distribution. The agreed value of this 1.1 million square
feet upon contribution is expected to be approximately $25.0 million.
The Partnership will record its investment in the joint venture related
to the additional contribution at its carrying value. The joint venture
partner is required to contributed cash to the venture equal to 49.9% of
the agreed value of the properties contributed and this cash will be
distributed to the Partnership and reduce its recorded investment in the
venture. The Partnership's joint venture partner contributed cash of
$67.5 million which was equal to the agreed value of the Partnership's
contribution. The total cash contributed by the Partnership and the
joint venture partner was used to purchase the 25 industrial buildings
noted above. The recently acquired industrial properties and the
undeveloped land which were contributed were acquired as part of the
acquisition of Park Fletcher, Inc., an Indianapolis, Indiana based real
estate development and management company. The acquisition was accounted
for under the purchase method. The recorded carrying value of acquired
properties and land was equal to the net liabilities assumed plus cash
paid plus mortgage indebtedness assumed of $17.4 million. The fair value
of the property exceeds the Company's recorded investment. The operating
results of the acquired properties and land have been included in the
consolidated operating results subsequent to the date of acquisition.
The Partnership accounts for its investment in this joint venture on the
equity method because the joint venture partner's approval is required
for all major decisions and the joint venture partner has equal control
regarding the primary day-to-day operations of the venture.
-34-
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
Combined summarized financial information of the companies which are
accounted for by the equity method as of December 31, 1995 and December 31,
1994 and for the years ended December 31, 1995, and 1994, and 1993 are as
follows (in thousands):
<TABLE>
<CAPTION>
December 31,
----------------------
1995 1994
-------- -------
<S> <C> <C>
Land, buildings and tenant improvements, net $155,628 $14,530
Land held for development 8,515 1,377
Other assets 4,742 1,978
------- ------
168,885 17,885
------- ------
------- ------
Property indebtedness 28,185 17,719
Other liabilities 3,736 591
------- ------
31,921 18,310
Owners' equity (deficit) 136,964 (425)
------- ------
$168,885 $17,885
------- ------
------- ------
<CAPTION>
Year ended December 31,
-----------------------------
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Rental income $3,398 $3,419 $ 950
----- ----- ---
----- ----- ---
Net income $ 363 $ 224 $ 211
---- ---- ---
---- ---- ---
</TABLE>
Investments in unconsolidated companies include $6.0 million and $6.4
million at December 31, 1995 and 1994, respectively, related to joint
ventures on the cost method. Included in equity in earnings of
unconsolidated companies are distributions from a joint venture accounted
for on the cost method totaling $521,000, $837,000 and $166,000 in 1995,
1994 and 1993, respectively.
-35-
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(5) INDEBTEDNESS
Indebtedness at December 31 consists of the following:
<TABLE>
<CAPTION>
1995 1994
---- ----
(in thousands)
<S> <C> <C>
Mortgage note with monthly payments of $668,000 including principal and
interest at 8.50% due in 2003 $ 78,832 $ 80,621
Mortgage note with monthly payments of interest of $436,000 through
August 1997. Thereafter, monthly payments of $471,000 including principal
and interest at 8.72% due in 2001 60,000 60,000
Mortgage note with monthly payments of interest at 7.25% due in 1998 25,500 25,500
Three mortgage notes with monthly payments of interest at rates ranging from
5.29% to 5.44% due in 1996 59,619 59,568
Mortgage note with monthly payments of interest at 5.81% due in 1998 - 22,000
Mortgage note with monthly payments of $104,000 including principal and interest
at 6.80% due in 1998 15,619 15,802
Mortgage notes with monthly payments in varying amounts including interest at
rates ranging from 5.20% to 10.25% due in varying amounts through 2018 20,250 35,149
------- -------
Total Mortgage Debt 259,820 298,640
Unsecured notes with semi-annual payments of interest at 7.25% (effective rate
of 7.328%) due in 2002 50,000 -
Unsecured notes with semi-annual payments of interest at 7.375% (effective rate
of 7.519%) due in 2005 100,000 -
Unsecured line of credit with monthly payments of interest at LIBOR + 2.00%
due in 1998 45,000 -
------- -------
Total Indebtedness $454,820 $298,640
------- -------
------- -------
</TABLE>
As of December 31, 1995, the $259.8 million of mortgage notes are
collateralized by rental properties with a net carrying value of $440
million. As of December 31, 1994, the $298.6 million of mortgage notes
were collateralized by rental properties with a net carrying value of $490
million and the Partnership's $60 million secured line of credit was
collateralized by rental properties with a net carrying value of $122
million.
On September 22, 1995, the Partnership issued $150 million of unsecured
notes. Interest is payable semi-annually on March 22 and September 22,
commencing on March 22, 1996.
In 1994, the Partnership obtained a $60 million secured line of credit
which was available to fund development costs and provide working capital.
This secured line of credit was scheduled to mature on
- 36 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
March 31, 1996. The interest rate was based on LIBOR plus 2% (an average
effective rate of 6.45% for 1994). The maximum and average amounts
outstanding during 1994 were $60.0 million and $18.0 million, respectively.
The Partnership had no borrowings under the line at December 31, 1994.
In April 1995, the Partnership replaced its secured line of credit with an
unsecured line of credit in the aggregate amount of $100 million. The
unsecured line of credit matures in April 1998. Borrowings under this line
of credit required interest at one month LIBOR plus 2.00% which ranged from
7.7500% to 7.9375% as of December 31, 1995. The maximum and average amounts
outstanding during 1995 under both lines of credit were $45.0 million and
$2.2 million respectively, with an average effective rate of 7.89%. In
January 1996, the Partnership increased its amount available under the
unsecured line of credit to $150 million and reduced the borrowing rate to
LIBOR plus 1.625%. The General Partner has guaranteed the unsecured
line of credit.
The Partnership has an interest rate swap agreement on $35.2 million of the
Partnership's outstanding mortgage debt to effectively fix the interest
rate on the majority of its floating rate debt. Under the interest rate
swap, the Partnership pays or receives the difference between a fixed rate
of 4.38% and a floating rate of LIBOR plus .75% based on the notional
principal amount of $35.2 million. The amount paid or received on the swap
agreement is included in interest expense on a monthly basis. The swap
matures along with the related mortgage loan in October 1996. The
estimated fair value of the interest rate swap agreement at December 31,
1995 was $174,000. The fair value was estimated by discounting the
expected cash flows to be received under the swap agreement using rates
currently available for interest rate swaps of similar terms and
maturities.
The Partnership has a $6.2 million letter of credit which secures $6.2
million of mortgage notes. The letter of credit requires a 2% annual fee
and matures in September 1999. The Partnership also has guaranteed fifty
percent of an $8.1 million letter of credit obligation of one of its
unconsolidated companies which matures in September 1997.
At December 31, 1995, scheduled amortization and maturities of all
indebtedness for the next five years and thereafter are as follows:
<TABLE>
<CAPTION>
Year Amount
---- ------
(in thousands)
<S> <C>
1996 $ 61,474
1997 2,156
1998 92,626
1999 2,625
2000 7,489
Thereafter 288,450
--------
$454,820
--------
--------
</TABLE>
Cash paid for interest in 1995, 1994, and 1993 was $22.1 million, $20.3
million, and $10.5 million, respectively. Total interest capitalized in
1995 and 1994 was $4.2 million and $1.7 million, respectively. No interest
was capitalized in 1993.
- 37 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(6) LEASING ACTIVITY
Future minimum rents due to the Partnership under non-cancelable operating
leases at December 31, 1995 are scheduled as follows:
<TABLE>
<CAPTION>
Year Amount
---- ------
(in thousands)
<S> <C>
1996 $113,325
1997 111,573
1998 100,807
1999 88,059
2000 73,106
Thereafter 433,083
--------
$919,953
--------
--------
</TABLE>
In addition to minimum rents, certain leases require reimbursements of
specified operating expenses which amounted to $12.7 million, $10.0
million, and $3.6 million for the years ended December 31, 1995, 1994 and
1993, respectively.
(7) EMPLOYEE BENEFIT PLANS
In October 1993, the Partnership established a profit sharing and salary
deferral plan. The Partnership matches the employees' contributions up to
two percent of the employees' salary and may also make annual discretionary
contributions to the plan. Total expense recognized by the Partnership was
$245,000, $370,000 and $74,000 for 1995, 1994 and 1993, respectively.
In October 1993, the Partnership also established a contributory health and
welfare plan. The Partnership makes contributions to the plan throughout
the year as necessary to fund claims not covered by employee contributions.
Total expense recognized by the Partnership related to this plan was
$882,000, $766,000 and $204,000 for 1995, 1994 and 1993, respectively.
Included in total expense is an estimate based on historical experience of
the effect of claims incurred but not reported as of year-end.
- 38 -
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(8) STOCK OPTION PLAN
In October 1993, the Partnership and the General Partner established a
stock option plan under which 1,315,000 shares of the General Partners'
common stock were reserved for the exercise of options which may be issued
to the executive officers of the General Partner and certain key employees
of the Partnership. The term of these options is ten years from the date of
grant. The options vest 20% per year over a five-year period with initial
vesting one year from the date of grant.
<TABLE>
<CAPTION>
Number of Option
shares subject price per
to options share
-------------- ---------
<S> <C> <C>
Balance at January 1, 1993 - -
Options granted 681,500 $23.75
Options forfeited - -
Options exercised - -
------- -------------------
Balance at December 31, 1993 681,500 $23.75
Options granted - -
Options forfeited - -
Options exercised - -
------- -------------------
Balance at December 31, 1994 681,500 $23.75
Options granted 225,466 $25.875 to $30.625
Options forfeited (39,900) $23.75 to $25.875
Options exercised (1,000) $23.75
------- -------------------
Balance at December 31, 1995 866,066 $ 23.75 to $30.625
------- -------------------
------- -------------------
</TABLE>
- 39 -
<PAGE>
DUKE ASSOCIATES
COMBINED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1993
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
<S> <C>
Rental Operations:
Revenues:
Rental income $42,721
Interest and other income 1,012
-------
43,733
-------
Operating expenses:
Rental expenses 8,765
Real estate taxes 4,340
Interest expense 25,580
Depreciation and amortization 10,599
General and administrative 780
-------
50,064
-------
Loss from rental operations (6,331)
-------
Property management operations:
Revenue:
Property management, maintenance and leasing fees 8,431
Construction and development fees 2,591
Interest and other income 932
-------
11,954
-------
Operating expenses:
Payroll 6,077
Maintenance 941
Office and other 1,543
-------
8,561
-------
Earnings from property management operations 3,393
-------
Operating loss (2,938)
Equity in earnings of non-combined companies 199
-------
Net loss $(2,739)
-------
-------
</TABLE>
See accompanying notes to combined financial statements.
- 40 -
<PAGE>
DUKE ASSOCIATES
COMBINED STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1993
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<S> <C>
Cash flows from operating activities:
Net loss $ (2,739)
Adjustments to reconcile net loss to net cash provided
by operating activities:
Depreciation 7,200
Amortization 3,399
Straight-line rent adjustment (1,356)
Increase in construction receivables (10,109)
Other accrued revenues and expenses, net 9,298
Equity in earnings of non-combined companies (199)
-------------
Net cash provided by operating activities 5,494
-------------
Cash flows from investing activities:
Land and construction costs (3,252)
Distributions from non-combined companies 47
Deferred charges and other assets (3,193)
-------------
Net cash used by investing activities (6,398)
-------------
Cash flows from financing activities:
Proceeds from property indebtedness 39,407
Payments on property indebtedness (5,959)
Contributions by owners 10,221
Distributions to owners (24,224)
Advances from affiliates, net (13,480)
-------------
Net cash provided by financing activities 5,965
-------------
Net increase in cash and cash equivalents 5,061
Cash and cash equivalents at beginning of period 1,046
-------------
Cash and cash equivalents at end of period $ 6,107
-------------
-------------
</TABLE>
See accompanying notes to combined financial statements.
- 41 -
<PAGE>
DUKE ASSOCIATES
NOTES TO COMBINED STATEMENTS OF OPERATIONS AND CASH FLOWS
(UNAUDITED)
(1) ORGANIZATION AND BASIS OF COMBINATION
The accompanying combined statements of operations and cash flows
of Duke Associates include the operations and cash flows from the operating
businesses, commercial rental properties and undeveloped land acquired by
Duke Realty Investments, Inc. (the "Company"). Duke Associates represents
substantially all of the real estate properties and operating businesses under
common control of the current Duke Associates owners which are engaged in the
ownership, leasing, management, construction and development businesses of
commercial real estate in the Midwest.
The statements of operations and cash flows of Duke Asssociates have been
presented on the combined basis because of the common ownership and management
of the related properties and operating businesses. After the aforementioned
acquisition, the properties and operating businesses will be majority owned
and controlled by the Company through its subsidiaries to be formed and known
as Duke Realty Limited Partnership and Duke Services, Inc. The equity method of
accounting is used for investments in non-majority owned partnerships and joint
ventures in which Duke Associates has the ability to exercise significant
influence over operating and financial policies. The cost method of accounting
is used for two non-majority owned joint ventures over which Duke Associates
does not have the ability to exercise significant influence, and the
differences between the cost method and the equity method of accounting for
these joint ventures does not significantly affect the financial position or
results of operations.
All significant intercompany balances and transactions have been
eliminated in the combined financial statements.
The combined statements of operations and cash flows for the nine months
ended September 30, 1993 are unaudited; however, in the opinion of management,
all adjustments (consisting solely of normal recurring adjustments) necessary
for a fair presentation of the combined financial statements for this interim
period have been included. The results for the interim period ended September
30, 1993 are not necessarily indicative of the results to be obtained for the
full fiscal year.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REVENUES
All leases are classified as operating leases and rental income is
recognized on the straight-line basis over the terms of the leases.
Management fees are based on a percentage of rental receipts of properties
managed and are recognized as the rental receipts are collected.
Leasing fees are based on the gross value of leases signed and are
recognized as earned under the terms of the various contracts.
Maintenance fees are recognized as the services are performed based upon
established hourly rates.
Construction management fees are generally based on a fixed percentage of
costs and are recognized as the project costs are incurred.
- 42 -
<PAGE>
DUKE ASSOCIATES
NOTES TO COMBINED STATEMENTS OF OPERATIONS AND CASH FLOWS - (CONTINUED)
(UNAUDITED)
Development fees are generally based on a percentage of total project costs of
properties developed and are recognized throughout the development process of
the related properties.
FINANCING AND LEASING COSTS
Costs incurred in connection with financing or leasing are amortized on a
straight-line method over the term of the related loan or lease. Unamortized
leasing costs are charged to expense upon the early termination of the lease.
INCOME TAXES
Income taxes are not provided in the accompanying combined financial
statements because the entities that own the properties and the operating
businesses are either partnerships or S corporations and the taxable income
or loss is included in the income tax returns of the individual partners or
shareholders.
- 43 -
<PAGE>
<TABLE>
<CAPTION>
DUKE REALTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31,1995
SCHEDULE III
(IN THOUSANDS)
BUILDING ENCUMBER-
LOCATION / DEVELOPMENT BUILDING TYPE ANCES
- ------------------------------ --------------------------- -------------- ------------
INDIANAPOLIS, INDIANA
- ---------------------
<S> <C> <C> <C>
PARK 100 BUSINESS PARK BUILDING #32 RETAIL $ 512
PARK 100 BUSINESS PARK BUILDING #34 OFFICE 1,083
PARK 100 BUSINESS PARK BUILDING #38 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #79 INDUSTRIAL 1,035
PARK 100 BUSINESS PARK BUILDING #80 INDUSTRIAL 1,339
PARK 100 BUSINESS PARK BUILDING #83 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #84 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #95 INDUSTRIAL 3,444
PARK 100 BUSINESS PARK BUILDING #96 INDUSTRIAL 6,488
PARK 100 BUSINESS PARK BUILDING #97 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #98 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #100 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #107 INDUSTRIAL 1,560
PARK 100 BUSINESS PARK BUILDING #109 INDUSTRIAL 1,200
PARK 100 BUSINESS PARK BUILDING #116 OFFICE 2,016
PARK 100 BUSINESS PARK BUILDING #118 OFFICE 1,254
PARK 100 BUSINESS PARK BUILDING #119 OFFICE 0
PARK 100 BUSINESS PARK BUILDING #121 RETAIL 0
PARK 100 BUSINESS PARK BUILDING #122 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #125 INDUSTRIAL 1,690
PARK 100 BUSINESS PARK BUILDING #126 INDUSTRIAL 0
PARK 100 BUSINESS PARK BUILDING #127 INDUSTRIAL 0
PARK 100 BUSINESS PARK NORGATE LAND LEASE INDUSTRIAL 0
PARK 100 BUSINESS PARK SCHAHET HOTELS LAND LEASE INDUSTRIAL 0
PARK 100 BUSINESS PARK KENNY ROGERS LAND LEASE INDUSTRIAL 0
PARK 100 BUSINESS PARK NORCO LAND LEASE INDUSTRIAL 0
PARK 100 BUSINESS PARK ZOLLMAN LAND LEASE INDUSTRIAL 0
SHADELAND STATION 7351 SHADELAND OFFICE 0
SHADELAND STATION BUILDING #204/205 INDUSTRIAL 1,832
SHADELAND STATION 7240 SHADELEND OFFICE (2) 2,706
SHADELAND STATION 7330 SHADELAND OFFICE 2,420
SHADELAND STATION 7369 SHADELAND OFFICE 0
SHADELAND STATION 7340 SHADELAND OFFICE 0
SHADELAND STATION 7400 SHADELAND OFFICE 0
CASTLETON CORNER CUB PLAZA RETAIL 3,304
CASTLETON SHOPPING CENTER MICHAEL'S PLAZA RETAIL 2,447
SOUTH PARK, INDIANA BUILDING #1 OFFICE 0
SOUTH PARK, INDIANA BUILDING #2 INDUSTRIAL 0
SOUTH PARK, INDIANA BUILDING #3 OFFICE 0
SOUTH PARK, INDIANA BRYLANE PARKING LOT LEASE OFFICE 0
SOUTH PARK, INDIANA LEE'S IN LAND LEASE INDUSTRIAL 0
GREENWOOD CORNER GREENWOOD CORNER RETAIL 2,176
GREENWOOD CORNER 1st INDIANA BANK BRANCH RETAIL 257
CARMEL MEDICAL I CARMEL MEDICAL I MEDICAL 1,948
ST. FRANCIS ST. FRANCIS MEDICAL 0
COMMUNITY MOB COMMUNITY MOB MEDICAL 0
CARMEL MEDICAL II CARMEL MEDICAL II MEDICAL 2,525
HILLSDALE TECHNECENTER BUILDING #4 INDUSTRIAL 2,482
HILLSDALE TECHNECENTER BUILDING #5 INDUSTRIAL 1,752
HILLSDALE TECHNECENTER BUILDING #6 INDUSTRIAL 2,111
KEYSTONE AT THE CROSSING 8465 KEYSTONE OFFICE 0
WOODFIELD AT THE CROSSING WOODFIELD II OFFICE 6,241
WOODFIELD AT THE CROSSING WOODFIELD III OFFICE 0
KEYSTONE AT THE CROSSING 3520 COMMERCE CRSG OFFICE 0
ONE PARKWOOD ONE PARKWOOD OFFICE 0
PALAMOR PALAMOR INDUSTRIAL 0
FRANKLIN ROAD BUSINESS CTR. FRANKLIN ROAD BUSINESS CTR. INDUSTRIAL 0
NAMPAC BUILDING NAMPAC BUILDING INDUSTRIAL 0
HAMILTON CROSSING BUILDING #1 OFFICE 0
KEYSTONE AT THE CROSSING F.C. TUCKER BUILDING OFFICE 0
PARK FLETCHER BUILDING #14 INDUSTRIAL 0
FORT WAYNE
- ------------------------------
COLDWATER CROSSING COLDWATER SHOPPES RETAIL 11,703
NASHVILLE, TENNESSEE
- ------------------------------
KEEBLER BUILDING KEEBLER BUILDING INDUSTRIAL 0
HAYWOOD OAKS TECHNECENTER BUILDING #2 INDUSTRIAL 1,055
HAYWOOD OAKS TECHNECENTER BUILDING #3 INDUSTRIAL 1,003
HAYWOOD OAKS TECHNECENTER BUILDING #4 INDUSTRIAL 1,151
HAYWOOD OAKS TECHNECENTER BUILDING #5 INDUSTRIAL 1,742
HAYWOOD OAKS TECHNECENTER BUILDING #6 INDUSTRIAL 0
HAYWOOD OAKS TECHNECENTER BUILDING #7 INDUSTRIAL 0
GREENBRIAR BUSINESS PARK GREENBRIAR INDUSTRIAL 0
HEBRON, KENTUCKY
- ------------------------------
SOUTHPARK, KENTUCKY CR SERVICES INDUSTRIAL 3,277
SOUTHPARK, KENTUCKY BUILDING #1 INDUSTRIAL 0
SOUTHPARK, KENTUCKY BUILDING #3 INDUSTRIAL 0
SOUTHPARK, KENTUCKY REDKEN INDUSTRIAL 2,471
CINCINNATI, OHIO
- ------------------------------
PARK 50 TECHNECENTER BUILDING #17 OFFICE 3,602
PARK 50 TECHNECENTER BUILDING #20 INDUSTRIAL 4,336
PARK 50 TECHNECENTER BUILDING #24 RETAIL 0
PARK 50 TECHNECENTER BUILDING #25 INDUSTRIAL 0
PARK 50 TECHNECENTER SDRC BUILDING OFFICE 13,640
FIDELITY DRIVE DUN & BRADSTREET OFFICE 1,836
WORLD PARK BUILDING #5 INDUSTRIAL 2,217
WORLD PARK BUILDING #6 INDUSTRIAL 2,459
WORLD PARK BUILDING #7 INDUSTRIAL 2,854
WORLD PARK BUILDING #8 INDUSTRIAL 2,842
WORLD PARK BUILDING #9 INDUSTRIAL 1,613
WORLD PARK BUILDING #11 INDUSTRIAL 2,563
WORLD PARK BUILDING #14 INDUSTRIAL 1,937
WORLD PARK BUILDING #15 INDUSTRIAL 0
WORLD PARK BUILDING #16 INDUSTRIAL 1,621
EASTGATE PLAZA EASTGATE PLAZA RETAIL 0
FAIRFIELD BUSINESS CENTER BUILDING D OFFICE 0
FAIRFIELD BUSINESS CENTER BUILDING E OFFICE 0
UNIVERSITY MOVING UNIVERSITY MOVING INDUSTRIAL 0
TRI-COUNTY OFFICE PARK BUILDINGS #1 - #4 OFFICE (3) 0
GOVERNOR'S PLAZA GOVERNOR'S PLAZA RETAIL 7,173
GOVERNOR'S PLAZA KING'S MALL II RETAIL 3,816
GOVERNOR'S PLAZA KOHLS RETAIL 0
SOFA EXPRESS SOFA EXPRESS RETAIL 0
OFFICE MAX OFFICE MAX RETAIL 0
312 ELM BUILDING 312 ELM OFFICE 34,990
311 ELM STREET ZUSSMAN OFFICE 0
ENTERPRISE BUSINESS PARK BUILDING 1 INDUSTRIAL 4,310
ENTERPRISE BUSINESS PARK BUILDING 2 INDUSTRIAL 3,118
ENTERPRISE BUSINESS PARK BUILDING A INDUSTRIAL 514
ENTERPRISE BUSINESS PARK BUILDING B INDUSTRIAL 790
ENTERPRISE BUSINESS PARK BUILDING D INDUSTRIAL 1,322
312 PLUM STREET S & L DATA OFFICE 0
TRIANGLE OFFICE PARK BUILDINGS #1 - #38 OFFICE 6,155
GOVERNOR'S HILL 8790 GOVERNOR'S HILL OFFICE 0
GOVERNOR'S HILL 8700 GOVERNOR'S HILL OFFICE 0
GOVERNOR'S HILL 8800 GOVERNOR'S HILL OFFICE 1,736
GOVERNOR'S HILL 8600 GOVERNOR'S HILL OFFICE 15,619
GOVERNOR'S POINTE 4770 GOVERNOR'S POINTE OFFICE 4,839
GOVERNOR'S POINTE 4700 BUILDING INDUSTRIAL 3,647
GOVERNOR'S POINTE 4900 BUILDING INDUSTRIAL 3,018
GOVERNOR'S POINTE 4705 GOVERNOR'S POINTE OFFICE 0
GOVERNOR'S POINTE 4800 GOVERNOR'S POINTE OFFICE 0
GOVERNOR'S POINTE 4605 GOVERNOR'S POINTE OFFICE 11,080
MONTGOMERY CROSSING STEINBERG'S RETAIL 719
MONTGOMERY CROSSING II SPORTS UNLIMITED RETAIL 2,844
GOVERNOR'S PLAZA KING'S AUTO MALL I RETAIL 3,383
SUGARCREEK PLAZA SUGARCREEK PLAZA RETAIL 4,132
COLUMBUS
- ------------------------------
CORP. PARK AT TUTTLE CRSG LITEL OFFICE 0
CORP. PARK AT TUTTLE CRSG STERLING 1 OFFICE 0
CORP. PARK AT TUTTLE CRSG INDIANA INSURANCE OFFICE 0
CORP. PARK AT TUTTLE CRSG STERLING 2 OFFICE 0
CORP. PARK AT TUTTLE CRSG JOHN ALDEN LIFE INSURANCE OFFICE 0
CORP. PARK AT TUTTLE CRSG CARDINAL HEALTH OFFICE 0
SOUTH POINTE BUILDING A INDUSTRIAL 0
PET FOODS BUILD-TO-SUIT PET FOODS DISTRIBUTION INDUSTRIAL 0
GALYAN'S GALYAN'S RETAIL 3,234
BEST BUY BEST BUY RETAIL 0
MBM BUILDING MBM BUILDING INDUSTRIAL 0
V.A. HOSPITAL V.A. HOSPITAL MEDICAL 6,340
CORP. PARK AT TUTTLE CRSG XEROX OFFICE 4,500
LIVONIA, MICHIGAN
- ------------------------------
LIVONIA BUILDING A OFFICE 0
LIVONIA BUILDING B OFFICE 0
DECATUR, ILLINOIS
- ------------------------------
PARK 101 BUILDING #3 INDUSTRIAL 1,964
PARK 101 BUILDING #8 INDUSTRIAL 1,057
PARK 101 ILL POWER LAND LEASE INDUSTRIAL 0
BLOOMINGTON, ILLINOIS
- ------------------------------
LAKEWOOD PLAZA LAKEWOOD PLAZA RETAIL 5,308
CHAMPAIGN, ILLINOIS
- ------------------------------
MARKET VIEW SHOPPING CTR MARKET VIEW CENTER RETAIL 4,263
ELLISVILLE, MISSOURI
- ------------------------------
ELLISVILLE PLAZA ELLISVILLE PLAZA RETAIL 2,204
ST. LOUIS, MISSOURI
- ------------------------------
LAUMEIER I LAUMEIER I OFFICE 0
LAUMEIER II LAUMEIER II OFFICE 0
WESTVIEW PLACE WESTVIEW PLACE OFFICE 0
WESTMARK WESTMARK OFFICE 0
VARIOUS LOCATIONS
- ------------------------------
LAND IMP. - UNDEVELOPED LAND N/A N/A 0
ELIMINATIONS
---------------
TOTALS $ 259,820
---------------
---------------
<CAPTION>
INITIAL COST TO
PARTNERSHIP COSTS (1)
------------------------- CAPITALIZED
BUILDINGS/ SUBSEQUENT TO
LOCATION/DEVELOPMENT BUILDING LAND IMPROVEMENTS ACQUISITION
- ------------------------------ --------------------------- -------- ------------ ---------------
<S> <C> <C> <C> <C>
INDIANAPOLIS, INDIANA
- ------------------------------
PARK 100 BUSINESS PARK BUILDING #32 64 740 45
PARK 100 BUSINESS PARK BUILDING #34 131 1,455 208
PARK 100 BUSINESS PARK BUILDING #38 25 241 25
PARK 100 BUSINESS PARK BUILDING #79 184 1,764 207
PARK 100 BUSINESS PARK BUILDING #80 251 2,412 125
PARK 100 BUSINESS PARK BUILDING #83 247 2,572 88
PARK 100 BUSINESS PARK BUILDING #84 347 2,604 63
PARK 100 BUSINESS PARK BUILDING #95 642 4,756 8
PARK 100 BUSINESS PARK BUILDING #96 1,414 8,734 37
PARK 100 BUSINESS PARK BUILDING #97 676 4,294 1,029
PARK 100 BUSINESS PARK BUILDING #98 473 6,022 1,169
PARK 100 BUSINESS PARK BUILDING #100 103 2,179 526
PARK 100 BUSINESS PARK BUILDING #107 99 1,575 89
PARK 100 BUSINESS PARK BUILDING #109 240 1,865 (119)
PARK 100 BUSINESS PARK BUILDING #116 341 3,144 (147)
PARK 100 BUSINESS PARK BUILDING #118 226 2,229 154
PARK 100 BUSINESS PARK BUILDING #119 388 3,386 161
PARK 100 BUSINESS PARK BUILDING #121 592 960 53
PARK 100 BUSINESS PARK BUILDING #122 284 3,359 173
PARK 100 BUSINESS PARK BUILDING #125 358 2,291 5
PARK 100 BUSINESS PARK BUILDING #126 165 1,362 80
PARK 100 BUSINESS PARK BUILDING #127 96 1,726 379
PARK 100 BUSINESS PARK NORGATE LAND LEASE 51 0 0
PARK 100 BUSINESS PARK SCHAHET HOTELS LAND LEASE 131 0 0
PARK 100 BUSINESS PARK KENNY ROGERS LAND LEASE 56 0 9
PARK 100 BUSINESS PARK NORCO LAND LEASE 0 38 0
PARK 100 BUSINESS PARK ZOLLMAN LAND LEASE 115 0 (0)
SHADELAND STATION 7351 SHADELAND 101 1,359 91
SHADELAND STATION BUILDING #204/205 260 2,595 179
SHADELAND STATION 7240 SHADELEND 152 3,113 776
SHADELAND STATION 7330 SHADELAND 255 4,045 (293)
SHADELAND STATION 7369 SHADELAND 100 1,129 37
SHADELAND STATION 7340 SHADELAND 165 2,458 68
SHADELAND STATION 7400 SHADELAND 570 2,959 252
CASTLETON CORNER CUB PLAZA 540 4,850 80
CASTLETON SHOPPING CENTER MICHAEL'S PLAZA 749 3,400 175
SOUTH PARK, INDIANA BUILDING #1 287 2,328 271
SOUTH PARK, INDIANA BUILDING #2 334 3,081 262
SOUTH PARK, INDIANA BUILDING #3 208 2,150 333
SOUTH PARK, INDIANA BRYLANE PARKING LOT LEASE 0 54 3
SOUTH PARK, INDIANA LEE'S IN LAND LEASE 0 5 0
GREENWOOD CORNER GREENWOOD CORNER 390 3,435 (223)
GREENWOOD CORNER 1st INDIANA BANK BRANCH 46 245 7
CARMEL MEDICAL I CARMEL MEDICAL I 0 3,710 (485)
ST. FRANCIS ST. FRANCIS 0 5,839 0
COMMUNITY MOB COMMUNITY MOB 350 1,925 521
CARMEL MEDICAL II CARMEL MEDICAL II 0 4,000 181
HILLSDALE TECHNECENTER BUILDING #4 366 4,711 88
HILLSDALE TECHNECENTER BUILDING #5 251 3,235 161
HILLSDALE TECHNECENTER BUILDING #6 315 4,054 25
KEYSTONE AT THE CROSSING 8465 KEYSTONE 89 1,302 11
WOODFIELD AT THE CROSSING WOODFIELD II 719 9,106 508
WOODFIELD AT THE CROSSING WOODFIELD III 3,767 19,817 1,245
KEYSTONE AT THE CROSSING 3520 COMMERCE CRSG 19 560 23
ONE PARKWOOD ONE PARKWOOD 1,018 9,578 0
PALAMOR PALAMOR 158 1,148 303
FRANKLIN ROAD BUSINESS CTR. FRANKLIN ROAD BUSINESS CTR. 594 3,986 945
NAMPAC BUILDING NAMPAC BUILDING 274 1,622 0
HAMILTON CROSSING BUILDING #1 526 2,424 189
KEYSTONE AT THE CROSSING F.C. TUCKER BUILDING 0 264 5
PARK FLETCHER BUILDING #14 76 722 0
FORT WAYNE
- ------------------------------
COLDWATER CROSSING COLDWATER SHOPPES 2,310 15,827 236
NASHVILLE, TENNESSEE
- ------------------------------
KEEBLER BUILDING KEEBLER BUILDING 307 1,183 0
HAYWOOD OAKS TECHNECENTER BUILDING #2 395 1,767 34
HAYWOOD OAKS TECHNECENTER BUILDING #3 346 1,575 168
HAYWOOD OAKS TECHNECENTER BUILDING #4 435 1,948 12
HAYWOOD OAKS TECHNECENTER BUILDING #5 629 2,816 180
HAYWOOD OAKS TECHNECENTER BUILDING #6 924 5,730 229
HAYWOOD OAKS TECHNECENTER BUILDING #7 456 1,642 183
GREENBRIAR BUSINESS PARK GREENBRIAR 1,445 4,490 209
HEBRON, KENTUCKY
- ------------------------------
SOUTHPARK, KENTUCKY CR SERVICES 1,085 4,060 0
SOUTHPARK, KENTUCKY BUILDING #1 682 3,725 94
SOUTHPARK, KENTUCKY BUILDING #3 841 3,382 98
SOUTHPARK, KENTUCKY REDKEN 779 3,095 5
CINCINNATI, OHIO
- ------------------------------
PARK 50 TECHNECENTER BUILDING #17 500 6,200 (737)
PARK 50 TECHNECENTER BUILDING #20 461 7,450 (732)
PARK 50 TECHNECENTER BUILDING #24 151 809 84
PARK 50 TECHNECENTER BUILDING #25 1,161 3,758 126
PARK 50 TECHNECENTER SDRC BUILDING 911 19,004 391
FIDELITY DRIVE DUN & BRADSTREET 270 2,510 260
WORLD PARK BUILDING #5 270 3,260 141
WORLD PARK BUILDING #6 378 4,488 (795)
WORLD PARK BUILDING #7 525 4,150 50
WORLD PARK BUILDING #8 561 5,309 45
WORLD PARK BUILDING #9 317 2,993 47
WORLD PARK BUILDING #11 460 4,701 174
WORLD PARK BUILDING #14 380 3,592 59
WORLD PARK BUILDING #15 373 2,274 211
WORLD PARK BUILDING #16 321 3,033 20
EASTGATE PLAZA EASTGATE PLAZA 2,030 4,079 18
FAIRFIELD BUSINESS CENTER BUILDING D 135 1,639 0
FAIRFIELD BUSINESS CENTER BUILDING E 398 2,461 0
UNIVERSITY MOVING UNIVERSITY MOVING 248 1,612 0
TRI-COUNTY OFFICE PARK BUILDINGS #1 - #4 217 5,211 484
GOVERNOR'S PLAZA GOVERNOR'S PLAZA 2,012 8,452 215
GOVERNOR'S PLAZA KING'S MALL II 1,928 3,636 117
GOVERNOR'S PLAZA KOHLS 1,345 3,575 6
SOFA EXPRESS SOFA EXPRESS 145 771 19
OFFICE MAX OFFICE MAX 651 1,223 2
312 ELM BUILDING 312 ELM 4,750 43,823 3,520
311 ELM STREET ZUSSMAN 339 6,226 146
ENTERPRISE BUSINESS PARK BUILDING 1 1,030 5,482 254
ENTERPRISE BUSINESS PARK BUILDING 2 733 3,443 719
ENTERPRISE BUSINESS PARK BUILDING A 119 685 0
ENTERPRISE BUSINESS PARK BUILDING B 119 1,117 0
ENTERPRISE BUSINESS PARK BUILDING D 243 1,802 24
312 PLUM STREET S & L DATA 2,539 24,312 1,023
TRIANGLE OFFICE PARK BUILDINGS #1 - #38 1,000 10,440 1,281
GOVERNOR'S HILL 8790 GOVERNOR'S HILL 400 4,581 216
GOVERNOR'S HILL 8700 GOVERNOR'S HILL 459 5,705 151
GOVERNOR'S HILL 8800 GOVERNOR'S HILL 225 2,305 344
GOVERNOR'S HILL 8600 GOVERNOR'S HILL 1,220 17,689 863
GOVERNOR'S POINTE 4770 GOVERNOR'S POINTE 586 7,609 (183)
GOVERNOR'S POINTE 4700 BUILDING 584 5,465 (10)
GOVERNOR'S POINTE 4900 BUILDING 654 4,017 326
GOVERNOR'S POINTE 4705 GOVERNOR'S POINTE 719 6,910 1,207
GOVERNOR'S POINTE 4800 GOVERNOR'S POINTE 978 4,742 554
GOVERNOR'S POINTE 4605 GOVERNOR'S POINTE 630 16,236 527
MONTGOMERY CROSSING STEINBERG'S 260 852 79
MONTGOMERY CROSSING II SPORTS UNLIMITED 778 3,687 0
GOVERNOR'S PLAZA KING'S AUTO MALL I 1,085 3,859 657
SUGARCREEK PLAZA SUGARCREEK PLAZA 898 6,492 (549)
COLUMBUS
- ------------------------------
CORP. PARK AT TUTTLE CRSG LITEL 2,618 17,428 442
CORP. PARK AT TUTTLE CRSG STERLING 1 1,494 11,856 284
CORP. PARK AT TUTTLE CRSG INDIANA INSURANCE 717 2,081 746
CORP. PARK AT TUTTLE CRSG STERLING 2 605 5,300 9
CORP. PARK AT TUTTLE CRSG JOHN ALDEN LIFE INSURANCE 1,066 6,856 13
CORP. PARK AT TUTTLE CRSG CARDINAL HEALTH 1,600 9,556 0
SOUTH POINTE BUILDING A 594 4,355 442
PET FOODS BUILD-TO-SUIT PET FOODS DISTRIBUTION 268 4,932 929
GALYAN'S GALYAN'S 1,925 3,146 6
BEST BUY BEST BUY 1,570 2,538 437
MBM BUILDING MBM BUILDING 170 1,916 5
V.A. HOSPITAL V.A. HOSPITAL 703 9,239 11
CORP. PARK AT TUTTLE CRSG XEROX 1,580 8,630 25
LIVONIA, MICHIGAN
- ------------------------------
LIVONIA 0 9,474 612
LIVONIA BUILDING A 0 11,930 554
BUILDING B
DECATUR, ILLINOIS
- ------------------------------
PARK 101 BUILDING #3 275 2,405 572
PARK 101 BUILDING #8 80 1,660 9
PARK 101 ILL POWER LAND LEASE 212 0 0
BLOOMINGTON, ILLINOIS
- ------------------------------
LAKEWOOD PLAZA LAKEWOOD PLAZA 766 7,199 824
CHAMPAIGN, ILLINOIS
- ------------------------------
MARKET VIEW SHOPPING CTR MARKET VIEW CENTER 740 6,830 (512)
ELLISVILLE, MISSOURI
- ------------------------------
ELLISVILLE PLAZA ELLISVILLE PLAZA 802 3,143 (295)
ST. LOUIS, MISSOURI
- ------------------------------
LAUMEIER I LAUMEIER I 1,220 9,091 0
LAUMEIER II LAUMEIER II 1,258 9,054 315
WESTVIEW PLACE WESTVIEW PLACE 673 8,389 4
WESTMARK WESTMARK 1,200 9,759 0
VARIOUS LOCATIONS
- ------------------------------
LAND IMP. - UNDEVELOPED LAND N/A 0 0 0
ELIMINATIONS
-------- ------------ ---------------
TOTALS 89,643 686,595 28,340
-------- ------------ ---------------
-------- ------------ ---------------
<CAPTION>
GROSS BOOK VALUE AT DECEMBER 31, 1995
---------------------------------------
LAND & BUILDINGS/
LOCATION/DEVELOPMENT BUILDING IMPROVEMENTS IMPROVEMENTS TOTAL
- ------------------------------ --------------------- ------------ ------------ --------
<S> <C> <C> <C> <C>
INDIANAPOLIS, INDIANA
- ------------------------------
PARK 100 BUSINESS PARK BUILDING #32 65 784 849
PARK 100 BUSINESS PARK BUILDING #34 133 1,661 1,794
PARK 100 BUSINESS PARK BUILDING #38 26 265 291
PARK 100 BUSINESS PARK BUILDING #79 187 1,968 2,155
PARK 100 BUSINESS PARK BUILDING #80 256 2,532 2,788
PARK 100 BUSINESS PARK BUILDING #83 252 2,655 2,907
PARK 100 BUSINESS PARK BUILDING #84 354 2,660 3,014
PARK 100 BUSINESS PARK BUILDING #95 642 4,764 5,406
PARK 100 BUSINESS PARK BUILDING #96 1,436 8,750 10,186
PARK 100 BUSINESS PARK BUILDING #97 676 5,323 5,999
PARK 100 BUSINESS PARK BUILDING #98 273 7,390 7,664
PARK 100 BUSINESS PARK BUILDING #100 103 2,706 2,809
PARK 100 BUSINESS PARK BUILDING #107 99 1,663 1,762
PARK 100 BUSINESS PARK BUILDING #109 246 1,740 1,986
PARK 100 BUSINESS PARK BUILDING #116 348 2,990 3,338
PARK 100 BUSINESS PARK BUILDING #118 230 2,379 2,609
PARK 100 BUSINESS PARK BUILDING #119 395 3,539 3,935
PARK 100 BUSINESS PARK BUILDING #121 604 1,001 1,605
PARK 100 BUSINESS PARK BUILDING #122 290 3,526 3,816
PARK 100 BUSINESS PARK BUILDING #125 358 2,295 2,654
PARK 100 BUSINESS PARK BUILDING #126 165 1,443 1,608
PARK 100 BUSINESS PARK BUILDING #127 96 2,105 2,201
PARK 100 BUSINESS PARK NORGATE LAND LEASE 51 0 51
PARK 100 BUSINESS PARK SCHAHET HOTELS LAND LEASE 131 0 131
PARK 100 BUSINESS PARK KENNY ROGERS LAND LEASE 56 9 65
PARK 100 BUSINESS PARK NORCO LAND LEASE 0 38 38
PARK 100 BUSINESS PARK ZOLLMAN LAND LEASE 115 0 115
SHADELAND STATION 7351 SHADELAND 103 1,449 1,551
SHADELAND STATION BUILDING #204/205 266 2,768 3,034
SHADELAND STATION 7240 SHADELEND 152 3,889 4,041
SHADELAND STATION 7330 SHADELAND 260 3,746 4,007
SHADELAND STATION 7369 SHADELAND 102 1,164 1,266
SHADELAND STATION 7340 SHADELAND 169 2,523 2,691
SHADELAND STATION 7400 SHADELAND 581 3,199 3,781
CASTLETON CORNER CUB PLAZA 550 4,920 5,470
CASTLETON SHOPPING CENTER MICHAEL'S PLAZA 764 3,561 4,324
SOUTH PARK, INDIANA BUILDING #1 292 2,594 2,886
SOUTH PARK, INDIANA BUILDING #2 341 3,336 3,677
SOUTH PARK, INDIANA BUILDING #3 212 2,479 2,691
SOUTH PARK, INDIANA BRYLANE PARKING LOT LEASE 0 57 57
SOUTH PARK, INDIANA LEE'S IN LAND LEASE 0 5 5
GREENWOOD CORNER GREENWOOD CORNER 400 3,202 3,602
GREENWOOD CORNER 1st INDIANA BANK BRANCH 47 251 298
CARMEL MEDICAL I CARMEL MEDICAL I 0 3,225 3,225
ST. FRANCIS ST. FRANCIS 0 5,839 5,839
COMMUNITY MOB COMMUNITY MOB 350 2,446 2,796
CARMEL MEDICAL II CARMEL MEDICAL II 0 4,181 4,181
HILLSDALE TECHNECENTER BUILDING #4 366 4,800 5,165
HILLSDALE TECHNECENTER BUILDING #5 251 3,396 3,647
HILLSDALE TECHNECENTER BUILDING #6 315 4,080 4,394
KEYSTONE AT THE CROSSING 8465 KEYSTONE 89 1,313 1,402
WOODFIELD AT THE CROSSING WOODFIELD II 733 9,600 10,333
WOODFIELD AT THE CROSSING WOODFIELD III 3,843 20,987 24,829
KEYSTONE AT THE CROSSING 3520 COMMERCE CRSG 0 602 602
ONE PARKWOOD ONE PARKWOOD 1,018 9,578 10,596
PALAMOR PALAMOR 158 1,450 1,608
FRANKLIN ROAD BUSINESS CTR. FRANKLIN ROAD BUSINESS CTR. 594 4,931 5,525
NAMPAC BUILDING NAMPAC BUILDING 274 1,622 1,896
HAMILTON CROSSING BUILDING #1 536 2,603 3,139
KEYSTONE AT THE CROSSING F.C. TUCKER BUILDING 0 269 269
PARK FLETCHER BUILDING #14 76 722 798
FORT WAYNE
- ------------------------------
COLDWATER CROSSING COLDWATER SHOPPES 2,310 16,063 18,373
NASHVILLE, TENNESSEE
- ------------------------------
KEEBLER BUILDING KEEBLER BUILDING 307 1,183 1,490
HAYWOOD OAKS TECHNECENTER BUILDING #2 395 1,801 2,196
HAYWOOD OAKS TECHNECENTER BUILDING #3 346 1,742 2,089
HAYWOOD OAKS TECHNECENTER BUILDING #4 435 1,960 2,395
HAYWOOD OAKS TECHNECENTER BUILDING #5 629 2,996 3,625
HAYWOOD OAKS TECHNECENTER BUILDING #6 946 5,938 6,883
HAYWOOD OAKS TECHNECENTER BUILDING #7 456 1,826 2,282
GREENBRIAR BUSINESS PARK GREENBRIAR 1,445 4,699 6,145
HEBRON, KENTUCKY
- ------------------------------
SOUTHPARK, KENTUCKY CR SERVICES 1,085 4,060 5,145
SOUTHPARK, KENTUCKY BUILDING #1 696 3,805 4,501
SOUTHPARK, KENTUCKY BUILDING #2 858 3,463 4,321
SOUTHPARK, KENTUCKY REDKEN 779 3,100 3,879
CINCINNATI, OHIO
- ------------------------------
PARK 50 TECHNECENTER BUILDING #17 510 5,453 5,963
PARK 50 TECHNECENTER BUILDING #20 469 6,710 7,179
PARK 50 TECHNECENTER BUILDING #24 154 890 1,044
PARK 50 TECHNECENTER BUILDING #25 1,184 3,861 5,045
PARK 50 TECHNECENTER SDRC BUILDING 929 19,377 20,306
FIDELITY DRIVE DUN & BRADSTREET 277 2,763 3,040
WORLD PARK BUILDING #5 276 3,395 3,671
WORLD PARK BUILDING #6 385 3,686 4,071
WORLD PARK BUILDING #7 537 4,188 4,725
WORLD PARK BUILDING #8 561 5,354 5,915
WORLD PARK BUILDING #9 317 3,041 3,357
WORLD PARK BUILDING #11 460 4,875 5,335
WORLD PARK BUILDING #14 380 3,651 4,031
WORLD PARK BUILDING #15 381 2,477 2,858
WORLD PARK BUILDING #16 321 3,053 3,374
EASTGATE PLAZA EASTGATE PLAZA 2,030 4,097 6,127
FAIRFIELD BUSINESS CENTER BUILDING D 135 1,639 1,774
FAIRFIELD BUSINESS CENTER BUILDING E 398 2,461 2,859
UNIVERSITY MOVING UNIVERSITY MOVING 248 1,612 1,860
TRI-COUNTY OFFICE PARK BUILDINGS #1 - #4 221 5,691 5,912
GOVERNOR'S PLAZA GOVERNOR'S PLAZA 2,053 8,627 10,679
GOVERNOR'S PLAZA KING'S MALL II 1,952 3,729 5,681
GOVERNOR'S PLAZA KOHLS 1,345 3,582 4,927
SOFA EXPRESS SOFA EXPRESS 145 789 935
OFFICE MAX OFFICE MAX 651 1,226 1,877
312 ELM BUILDING 312 ELM 5,428 46,664 52,093
311 ELM STREET ZUSSMAN 0 6,711 6,711
ENTERPRISE BUSINESS PARK BUILDING 1 1,051 5,715 6,766
ENTERPRISE BUSINESS PARK BUILDING 2 747 4,148 4,895
ENTERPRISE BUSINESS PARK BUILDING A 119 685 804
ENTERPRISE BUSINESS PARK BUILDING B 119 1,117 1,236
ENTERPRISE BUSINESS PARK BUILDING D 243 1,827 2,070
312 PLUM STREET S & L DATA 2,590 25,285 27,874
TRIANGLE OFFICE PARK BUILDINGS #1 - #38 1,018 11,703 12,721
GOVERNOR'S HILL 8790 GOVERNOR'S HILL 408 4,789 5,197
GOVERNOR'S HILL 8700 GOVERNOR'S HILL 468 5,847 6,315
GOVERNOR'S HILL 8800 GOVERNOR'S HILL 231 2,642 2,874
GOVERNOR'S HILL 8600 GOVERNOR'S HILL 1,245 18,527 19,772
GOVERNOR'S POINTE 4770 GOVERNOR'S POINTE 596 7,416 8,012
GOVERNOR'S POINTE 4700 BUILDING 595 5,444 6,039
GOVERNOR'S POINTE 4900 BUILDING 673 4,324 4,997
GOVERNOR'S POINTE 4705 GOVERNOR'S POINTE 733 8,103 8,836
GOVERNOR'S POINTE 4800 GOVERNOR'S POINTE 998 5,276 6,274
GOVERNOR'S POINTE 4605 GOVERNOR'S POINTE 643 16,750 17,393
MONTGOMERY CROSSING STEINBERG'S 260 931 1,191
MONTGOMERY CROSSING II SPORTS UNLIMITED 778 3,687 4,465
GOVERNOR'S PLAZA KING'S AUTO MALL I 1,124 4,477 5,601
SUGARCREEK PLAZA SUGARCREEK PLAZA 922 5,919 6,841
COLUMBUS
- ------------------------------
CORP. PARK AT TUTTLE CRSG LITEL 2,670 17,818 20,488
CORP. PARK AT TUTTLE CRSG STERLING 1 1,524 12,110 13,634
CORP. PARK AT TUTTLE CRSG INDIANA INSURANCE 717 2,827 3,544
CORP. PARK AT TUTTLE CRSG STERLING 2 605 5,309 5,914
CORP. PARK AT TUTTLE CRSG JOHN ALDEN LIFE INSURANCE 1,066 6,869 7,935
CORP. PARK AT TUTTLE CRSG CARDINAL HEALTH 1,600 9,556 11,156
SOUTH POINTE BUILDING A 594 4,797 5,391
PET FOODS BUILD-TO-SUIT PET FOODS DISTRIBUTION 1,031 5,098 6,130
GALYAN'S GALYAN'S 1,925 3,152 5,077
BEST BUY BEST BUY 1,570 2,974 4,544
MBM BUILDING MBM BUILDING 170 1,921 2,091
V.A. HOSPITAL V.A. HOSPITAL 703 9,250 9,953
CORP. PARK AT TUTTLE CRSG XEROX 1,580 8,655 10,235
LIVONIA, MICHIGAN
- ------------------------------
LIVONIA BUILDING A 0 10,086 10,086
LIVONIA BUILDING B 0 12,484 12,484
DECATUR, ILLINOIS
- ------------------------------
PARK 101 BUILDING #3 280 2,972 3,252
PARK 101 BUILDING #8 184 1,566 1,749
PARK 101 ILL POWER AND LEASE 212 0 212
BLOOMINGTON, ILLINOIS
- ------------------------------
LAKEWOOD PLAZA LAKEWOOD PLAZA 786 8,003 8,789
CHAMPAIGN, ILLINOIS
- ------------------------------
MARKET VIEW SHOPPING CTR MARKET VIEW CENTER 755 6,303 7,058
ELLISVILLE, MISSOURI
- ------------------------------
ELLISVILLE PLAZA ELLISVILLE PLAZA 802 2,848 3,650
ST. LOUIS, MISSOURI
- ------------------------------
LAUMEIER I LAUMEIER I 1,220 9,091 10,311
LAUMEIER II LAUMEIER II 1,258 9,368 10,626
WESTVIEW PLACE WESTVIEW PLACE 673 8,393 9,066
WESTMARK WESTMARK 1,200 9,759 10,959
VARIOUS LOCATIONS
- ------------------------------
LAND IMP. - UNDEVELOPED LAND N/A 0 0 0
ELIMINATIONS 0 (414) (414)
------------ ------------ --------
TOTALS 91,550 712,614 804,164
------------ ------------ --------
------------ ------------ --------
<CAPTION>
ACCUMULATED DATE OF DATE DEPRECIABLE
LOCATION/DEVELOPMENT BUILDING DEPRECIATION CONSTRUCTION ACQUIRED LIFE
- ------------------------------ --------------------- ------------- ------------ -------- -----------
<S> <C> <C> <C> <C> <C>
INDIANAPOLIS, INDIANA
- ------------------------------
PARK 100 BUSINESS PARK BUILDING #32 194 1978 1986 (6)
PARK 100 BUSINESS PARK BUILDING #34 439 1979 1986 (6)
PARK 100 BUSINESS PARK BUILDING #38 15 1978 1993 (6)
PARK 100 BUSINESS PARK BUILDING #79 137 1988 1993 (6)
PARK 100 BUSINESS PARK BUILDING #80 173 1988 1993 (6)
PARK 100 BUSINESS PARK BUILDING #83 166 1989 1993 (6)
PARK 100 BUSINESS PARK BUILDING #84 150 1989 1993 (6)
PARK 100 BUSINESS PARK BUILDING #95 238 1993 1994 (6)
PARK 100 BUSINESS PARK BUILDING #96 219 1994 1994 (6)
PARK 100 BUSINESS PARK BUILDING #97 304 1994 1994 (6)
PARK 100 BUSINESS PARK BUILDING #98 381 1968 1994 (6)
PARK 100 BUSINESS PARK BUILDING #100 41 1995 1995 (6)
PARK 100 BUSINESS PARK BUILDING #107 48 1984 1995 (6)
PARK 100 BUSINESS PARK BUILDING #109 482 1985 1986 (6)
PARK 100 BUSINESS PARK BUILDING #116 551 1988 1988 (6)
PARK 100 BUSINESS PARK BUILDING #118 166 1988 1993 (6)
PARK 100 BUSINESS PARK BUILDING #119 227 1989 1993 (6)
PARK 100 BUSINESS PARK BUILDING #121 56 1989 1993 (6)
PARK 100 BUSINESS PARK BUILDING #122 233 1990 1993 (6)
PARK 100 BUSINESS PARK BUILDING #125 96 1994 1994 (6)
PARK 100 BUSINESS PARK BUILDING #126 67 1984 1994 (6)
PARK 100 BUSINESS PARK BUILDING #127 50 1995 1995 (6)
PARK 100 BUSINESS PARK NORGATE LAND LEASE 0 N/A 1995 (6)
PARK 100 BUSINESS PARK SCHAHET HOTELS LAND LEASE 0 N/A 1995 (6)
PARK 100 BUSINESS PARK KENNY ROGERS LAND LEASE 0 N/A 1995 (6)
PARK 100 BUSINESS PARK NORCO LAND LEASE 31 N/A 1995 (6)
PARK 100 BUSINESS PARK ZOLLMAN LAND LEASE 0 N/A 1994 (6)
SHADELAND STATION 7351 SHADELAND 92 1983 1993 (6)
SHADELAND STATION BUILDING #204/205 694 1984 1986 (6)
SHADELAND STATION 7240 SHADELEND 938 1985 1993 (6)
SHADELAND STATION 7330 SHADELAND 658 1988 1988 (6)
SHADELAND STATION 7369 SHADELAND 67 1989 1993 (6)
SHADELAND STATION 7340 SHADELAND 145 1989 1993 (6)
SHADELAND STATION 7400 SHADELAND 223 1990 1993 (6)
CASTLETON CORNER CUB PLAZA 1,224 1986 1986 (6)
CASTLETON SHOPPING CENTER MICHAEL'S PLAZA 222 1984 1993 (6)
SOUTH PARK, INDIANA BUILDING #1 238 1989 1993 (6)
SOUTH PARK, INDIANA BUILDING #2 217 1990 1993 (6)
SOUTH PARK, INDIANA BUILDING #3 233 1990 1993 (6)
SOUTH PARK, INDIANA BRYLANE PARKING LOT LEASE 8 N/A 1994 (6)
SOUTH PARK, INDIANA LEE'S IN LAND LEASE 0 N/A N/A (6)
GREENWOOD CORNER GREENWOOD CORNER 790 1986 1986 (6)
GREENWOOD CORNER 1st INDIANA BANK BRANCH 14 1988 1993 (6)
CARMEL MEDICAL I CARMEL MEDICAL I 838 1985 1986 (6)
ST. FRANCIS ST. FRANCIS 129 1995 1995 (6)
COMMUNITY MOB COMMUNITY MOB 18 1995 1995 (6)
CARMEL MEDICAL II CARMEL MEDICAL II 528 1989 1990 (6)
HILLSDALE TECHNECENTER BUILDING #4 282 1987 1993 (6)
HILLSDALE TECHNECENTER BUILDING #5 206 1987 1993 (6)
HILLSDALE TECHNECENTER BUILDING #6 229 1987 1993 (6)
KEYSTONE AT THE CROSSING 8465 KEYSTONE 13 1983 1995 (6)
WOODFIELD AT THE CROSSING WOODFIELD II 646 1987 1993 (6)
WOODFIELD AT THE CROSSING WOODFIELD III 1,370 1989 1993 (6)
KEYSTONE AT THE CROSSING 3520 COMMERCE CRSG 107 1976 1993 (6)
ONE PARKWOOD ONE PARKWOOD 0 1989 1995 (6)
PALAMOR PALAMOR 36 1973 1995 (6)
FRANKLIN ROAD BUSINESS CTR. FRANKLIN ROAD BUSINESS CTR. 103 1962 1995 (6)
NAMPAC BUILDING NAMPAC BUILDING 27 1974 1995 (6)
HAMILTON CROSSING BUILDING #1 162 1989 1993 (6)
KEYSTONE AT THE CROSSING F.C. TUCKER BUILDING 15 1978 1993 (6)
PARK FLETCHER BUILDING #14 5 1978 1995 (6)
FORT WAYNE
- ------------------------------
COLDWATER CROSSING COLDWATER SHOPPES 621 1990 1994 (6)
NASHVILLE, TENNESSEE
- ------------------------------
KEEBLER BUILDING KEEBLER BUILDING 25 1985 1995 (6)
HAYWOOD OAKS TECHNECENTER BUILDING #2 109 1988 1993 (6)
HAYWOOD OAKS TECHNECENTER BUILDING #3 159 1988 1993 (6)
HAYWOOD OAKS TECHNECENTER BUILDING #4 110 1988 1993 (6)
HAYWOOD OAKS TECHNECENTER BUILDING #5 205 1988 1993 (6)
HAYWOOD OAKS TECHNECENTER BUILDING #6 365 1989 1993 (6)
HAYWOOD OAKS TECHNECENTER BUILDING #7 5 1995 1995 (6)
GREENBRIAR BUSINESS PARK GREENBRIAR 179 1986 1993 (6)
HEBRON, KENTUCKY
- ------------------------------
SOUTHPARK, KENTUCKY CR SERVICES 156 1994 1994 (6)
SOUTHPARK, KENTUCKY BUILDING #1 211 1990 1993 (6)
SOUTHPARK, KENTUCKY BUILDING #2 193 1991 1993 (6)
SOUTHPARK, KENTUCKY REDKEN 123 1994 1994 (6)
CINCINNATI, OHIO
- ------------------------------
PARK 50 TECHNECENTER BUILDING #17 1,566 1985 1986 (6)
PARK 50 TECHNECENTER BUILDING #20 1,246 1987 1988 (6)
PARK 50 TECHNECENTER BUILDING #24 56 1989 1993 (6)
PARK 50 TECHNECENTER BUILDING #25 217 1989 1993 (6)
PARK 50 TECHNECENTER SDRC BUILDING 1,078 1991 1993 (6)
FIDELITY DRIVE DUN & BRADSTREET 739 1972 1986 (6)
WORLD PARK BUILDING #5 803 1987 1990 (6)
WORLD PARK BUILDING #6 738 1987 1990 (6)
WORLD PARK BUILDING #7 722 1987 1990 (6)
WORLD PARK BUILDING #8 300 1989 1993 (6)
WORLD PARK BUILDING #9 177 1989 1993 (6)
WORLD PARK BUILDING #11 307 1989 1993 (6)
WORLD PARK BUILDING #14 216 1989 1993 (6)
WORLD PARK BUILDING #15 164 1990 1993 (6)
WORLD PARK BUILDING #16 171 1989 1993 (6)
EASTGATE PLAZA EASTGATE PLAZA 89 1990 1995 (6)
FAIRFIELD BUSINESS CENTER BUILDING D 5 1990 1995 (6)
FAIRFIELD BUSINESS CENTER BUILDING E 7 1990 1995 (6)
UNIVERSITY MOVING UNIVERSITY MOVING 34 1991 1995 (6)
TRI-COUNTY OFFICE PARK BUILDINGS #1 - #4 355 1971 1993 (6)
GOVERNOR'S PLAZA GOVERNOR'S PLAZA 483 1990 1993 (6)
GOVERNOR'S PLAZA KING'S MALL II 207 1988 1989 (6)
GOVERNOR'S PLAZA KOHLS 104 1994 1994 (6)
SOFA EXPRESS SOFA EXPRESS 5 1995 1995 (6)
OFFICE MAX OFFICE MAX 14 1995 1995 (6)
312 ELM BUILDING 312 ELM 2,680 1992 1993 (6)
311 ELM STREET ZUSSMAN 367 1902(4) 1993 (6)
ENTERPRISE BUSINESS PARK BUILDING 1 335 1990 1993 (6)
ENTERPRISE BUSINESS PARK BUILDING 2 337 1990 1993 (6)
ENTERPRISE BUSINESS PARK BUILDING A 10 1987 1995 (6)
ENTERPRISE BUSINESS PARK BUILDING B 17 1988 1995 (6)
ENTERPRISE BUSINESS PARK BUILDING D 29 1989 1995 (6)
312 PLUM STREET S & L DATA 1,416 1987 1993 (6)
TRIANGLE OFFICE PARK BUILDINGS #1 - #38 3,842 1965(5) 1986 (6)
GOVERNOR'S HILL 8790 GOVERNOR'S HILL 270 1985 1991 (6)
GOVERNOR'S HILL 8700 GOVERNOR'S HILL 324 1985 1993 (6)
GOVERNOR'S HILL 8800 GOVERNOR'S HILL 873 1985 1986 (6)
GOVERNOR'S HILL 8600 GOVERNOR'S HILL 1,112 1986 1991 (6)
GOVERNOR'S POINTE 4770 GOVERNOR'S POINTE 1,384 1986 1988 (6)
GOVERNOR'S POINTE 4700 BUILDING 1,084 1987 1988 (6)
GOVERNOR'S POINTE 4900 BUILDING 969 1987 1989 (6)
GOVERNOR'S POINTE 4705 GOVERNOR'S POINTE 421 1988 1993 (6)
GOVERNOR'S POINTE 4800 GOVERNOR'S POINTE 399 1989 1993 (6)
GOVERNOR'S POINTE 4605 GOVERNOR'S POINTE 963 1990 1993 (6)
MONTGOMERY CROSSING STEINBERG'S 25 1993 1993 (6)
MONTGOMERY CROSSING II SPORTS UNLIMITED 129 1994 1994 (6)
GOVERNOR'S PLAZA KING'S AUTO MALL I 804 1990 1993 (6)
SUGARCREEK PLAZA SUGARCREEK PLAZA 1,094 1988 1988 (6)
COLUMBUS
- ------------------------------
CORP. PARK AT TUTTLE CRSG LITEL 989 1990 1993 (6)
CORP. PARK AT TUTTLE CRSG STERLING 1 673 1990 1993 (6)
CORP. PARK AT TUTTLE CRSG INDIANA INSURANCE 196 1994 1994 (6)
CORP. PARK AT TUTTLE CRSG STERLING 2 98 1995 1995 (6)
CORP. PARK AT TUTTLE CRSG JOHN ALDEN LIFE INSURANCE 127 1995 1995 (6)
CORP. PARK AT TUTTLE CRSG CARDINAL HEALTH 125 1995 1995 (6)
SOUTH POINTE BUILDING A 56 1995 1995 (6)
PET FOODS BUILD-TO-SUIT PET FOODS DISTRIBUTION 167 1993 1993 (6)
GALYAN'S GALYAN'S 98 1994 1994 (6)
BEST BUY BEST BUY 15 1995 1995 (6)
MBM BUILDING MBM BUILDING 48 1978 1994 (6)
V.A. HOSPITAL V.A. HOSPITAL 294 1994 1994 (6)
CORP. PARK AT TUTTLE CRSG XEROX 366 1992 1994 (6)
LIVONIA, MICHIGAN
- ------------------------------
LIVONIA BUILDING A 687 1988 1993 (6)
LIVONIA BUILDING B 787 1989 1993 (6)
DECATUR, ILLINOIS
- ------------------------------
PARK 101 BUILDING #3 872 1979 1986 (6)
PARK 101 BUILDING #8 408 1980 1986 (6)
PARK 101 ILL POWER AND LEASE 0 N/A 1994 (6)
BLOOMINGTON, ILLINOIS
- ------------------------------
LAKEWOOD PLAZA LAKEWOOD PLAZA 1,430 1987 1988 (6)
CHAMPAIGN, ILLINOIS
- ------------------------------
MARKET VIEW SHOPPING CTR MARKET VIEW CENTER 1,553 1985 1986 (6)
ELLISVILLE, MISSOURI
- ------------------------------
ELLISVILLE PLAZA ELLISVILLE PLAZA 506 1987 1988 (6)
ST. LOUIS, MISSOURI
- ------------------------------
LAUMEIER I LAUMEIER I 133 1987 1995 (6)
LAUMEIER II LAUMEIER II 137 1988 1995 (6)
WESTVIEW PLACE WESTVIEW PLACE 122 1988 1995 (6)
WESTMARK WESTMARK 40 1987 1995 (6)
VARIOUS LOCATIONS
- ------------------------------
LAND IMP. - UNDEVELOPED LAND N/A 316
ELIMINATIONS 0
-------------
TOTALS 56,335
-------------
-------------
</TABLE>
44
<PAGE>
DUKE REALTY LIMITED PARTNERSHIP
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1995
(IN THOUSANDS)
(1) Costs capitalized subsequent to acquisition include decreases for purchase
price reduction payments received and land sales or takedowns.
(2) The Partnership owns a 66.67% interest in the partnership owning this
building. The Partnership shares in the cash flow of this building in
accordance with the Partnership's ownership interests.
(3) The four buildings comprising Tri-County Office Park were constructed in
1971,1973, and 1982.
(4) This building was renovated in 1986.
(5) This building was renovated in 1985.
(6) Depreciation of real estate is computed using the straight-line method over
40 years for building and shorter periods based on lease terms (generally 3
to 10 years) for tenant improvements.
<TABLE>
<CAPTION>
Real Estate Assets Accumulated Depreciation
--------------------------------- --------------------------------
1995 1994 1993 1995 1994 1993
--------------------------------- --------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance at beginning of year $ 653,552 $ 540,376 132,459 $ 38,058 $ 23,725 17,508
Additions during year:
Acquisitions 114,705 57,218 400,198 0 0 (242)
Construction costs and tenant improvements 84,790 41,125 8,881 0 0 0
Depreciation expense 0 0 0 20,416 15,068 6,459
Acquisition of minority interest
and joint venture interest 796 15,742 0 0 0 0
--------------------------------- --------------------------------
853,843 654,461 541,538 58,474 38,793 23,725
Deductions during year:
Cost of real estate sold (4,393) (909) (1,162) (1,259) 0 0
Contribution to Joint Venture (44,725) 0 0 (319) 0 0
Other (561) 0 0 (561) (735) 0
----------------------------------------------------------------------
Balance at end of year $ 804,164 $ 653,552 540,376 $ 56,335 $ 38,058 23,725
----------------------------------------------------------------------
----------------------------------------------------------------------
</TABLE>
- 45 -
<PAGE>
3. EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
4.1 Amended and Restated Agreement of Limited Partnership of Duke Realty
Limited Partnership ("DRLP") is incorporated herein by reference to
Exhibit 10.1 to the registration statement of Duke Realty Investments,
Inc. on Form S-2, as amended, filed on June 8, 1993, as File No. 33-64038
(the "1993 Registration Statement").
4.2 First and Second Amendments to Amended and Restated Agreement of Limited
Partnership of DRLP are incorported herein by reference to Exhibit 10.2
of the Annual Report on Form 10-K of Duke Realty Investments, Inc. for
the year ended December 31, 1995 (File No. 1-9044)("DRE 10-K").
4.3 Indenture between DRLP and The First National Bank of Chicago, Trustee,
and the First Supplement thereto, are incorporated by reference to
Exhibits 4.1 and 4.2 to the report of Duke Realty Investments, Inc. on
Form 8-K filed September 19, 1995.
10.3 Second Amended and Restated Agreement of Limited Partnership of Duke
Realty Services Limited Partnership (the "Services Partnership")
is incorporated herein by reference to Exhibit 10.3 of the DRE 10-K.
10.4 Promissory Note of the Services Partnership is incorporated herein by
reference to Exhibit 10.3 to the 1993 Registration Statement.
10.5 Duke Realty Services Partnership 1993 Stock Option Plan is incorporated
herein by reference to Exhibit 10.4 to the 1993 Registration Statement.
10.6 Acquisition Option Agreement relating to certain properties not
contributed to DRLP by Duke Associates (the "Excluded Properties") is
incorporated herein by reference to Exhibit 10.5 to the 1993 Registration
Statement.
10.7 Management Agreement relating to the Excluded Properties is incorporated
herein by reference to Exhibit 10.6 to the 1993 Registration Statement.
10.8 Contribution Agreement for certain properties and land contributed by
Duke Associates and Registrant to DRLP is incorporated herein by
reference to Exhibit 10.7 to the 1993 Registration Statement.
10.9 Contribution Agreement for certain assets and contracts contributed by
Duke Associates to the Service Partnership is incorporated herein by
reference to Exhibit 10.8 to the 1993 Registration Statement.
10.10 Contribution Agreement for certain contracts contributed by Duke
Associates to DRLP is incorporated herein by reference to Exhibit 10.9 to
the 1993 Registration Statement.
- 46 -
<PAGE>
10.11 Stock Purchase Agreement is incorporated herein by reference to Exhibit
10.10 to the 1993 Registration Statement.
10.12 Indemnification Agreement is incorporated herein by reference to Exhibit
10.11 to the 1993 Registration Statement.
10.13 1995 Key Employee Stock Option Plan is incorporated herein by reference
to Exhibit 10.13 of the DRE 10-K.
10.14 1995 Dividend Increase Unit Plan is incorporated herein by reference
to Exhibit 10.14 of the DRE 10-K.
10.15 1995 Shareholder Value Plan is incorporated herein by reference
to Exhibit 10.15 of the DRE 10-K.
21. List of Subsidiaries of Registrant.
23. Consent of KPMG Peat Marwick LLP.
24. Executed powers of attorney of certain directors.
27. Financial Data Schedule
99.1 Selected Quarterly Financial Information
- 47 -
<PAGE>
The Partnership will furnish to any security holder, upon written request,
copies of any exhibit incorporated by reference, for a fee of 15 cents per page,
to cover the costs of furnishing the exhibits. Written request should include a
representation that the person making the request was the beneficial owner of
securities.
(b) REPORTS ON FORM 8-K
A report on Form 8-K dated January 12, 1996 was filed with the Commission to
report under Item 5 the formation of a joint venture with an institutional real
estate investor.
- 48 -
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
DUKE REALTY LIMITED PARTNERSHIP
By: Duke Realty Investments, Inc.
Its General Partner
March 20 ,1996 By: /s/ Thomas L. Hefner
- ------------------------------ -------------------------------
Thomas L. Hefner
President and Chief Executive Officer
By: /s/ Darell E. Zink, Jr.
-------------------------------
Darell E. Zink, Jr.
Executive Vice President and
Chief Financial Officer
By: /s/ Dennis D. Oklak
-------------------------------
Dennis D. Oklak
Vice President and Treasurer
(Chief Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
Signature Date Title
--------- ---- -----
John W. Wynne* 3/20/96 Chairman of the Board
- --------------------------- -----------
John W. Wynne
Thomas L. Hefner* 3/20/96 President and Chief Executive
- --------------------------- ----------- Officer and Director
Thomas L. Hefner
Daniel C. Staton* 3/20/96 Executive Vice President and Chief
- --------------------------- ----------- Operating Officer and Director
Daniel C. Staton
Darell E. Zink, Jr.* 3/20/96 Executive Vice President and Chief
- --------------------------- ----------- Financial Officer and Director
Darell E. Zink, Jr.
- 49 -
<PAGE>
Geoffrey Button* 3/20/96 Director
- --------------------------- -----------
Geoffrey Button
John D. Peterson* 3/20/96 Director
- --------------------------- -----------
John D. Peterson
Ngaire E. Cuneo* 3/20/96 Director
- --------------------------- -----------
Ngaire E. Cuneo
Lee Stanfield* 3/20/96 Director
- --------------------------- -----------
Lee Stanfield
Jay J. Strauss* 3/20/96 Director
- --------------------------- -----------
Jay J. Strauss
Howard L. Feinsand* 3/20/96 Director
- --------------------------- -----------
Howard L. Feinsand
James E. Rogers* 3/20/96 Director
- --------------------------- -----------
James E. Rogers
*By Dennis D. Oklak, Attorney-in-Fact
- 50 -
<PAGE>
EXHIBIT 23
The Partners
DUKE REALTY LIMITED PARTNERSHIP:
We consent to incorporation by reference in the registration statement (No.
33-61361) on Form S-3 of Duke Realty Investments, Inc. and Duke Realty
Limited Partnership of our report dated January 31, 1996, relating to the
consolidated balance sheets of Duke Realty Limited Partnership and
Subsidiaries as of December 31, 1995 and 1994, and the related consolidated
statements of operations, partners' equity and cash flows for each of the
years in the three-year period ended December 31, 1995 and the related
schedule, which report appears in the December 31, 1995 annual report on Form
10-K/A of Duke Realty Limited Partnership.
/s/ KPMG Peat Marwick, LLP
Indianapolis, Indiana
March 18, 1996
